Galiano Gold Q1 Earnings Call Highlights

Key Points

• Q1 production was solid and in line with plan, with Galiano Gold producing about 34,500 ounces and keeping its full-year guidance of 140,000 to 160,000 ounces unchanged. Management said lower first-quarter processing was expected due to planned maintenance, and output should improve later in 2026 as mining ramps up.
• Revenue hit a record $166 million thanks to the strong gold price, while cash flow from operations reached $47 million. Earnings were still weighed down by hedge losses, but the company ended the quarter with about $115 million in cash and roughly $190 million in total liquidity including its undrawn credit facility.
• Exploration spending is rising sharply, with the 2026 budget increased from $17 million to $25 million as Galiano expands drilling at Esaase and Abore. Management sees these programs as key to reserve growth, potential mine-life extension, and a possible cash flow inflection in 2027 as production improves and hedges roll off.

Galiano Gold NYSEAMERICAN: GAU reported first-quarter 2026 results that management said were in line with plan, supported by steady production at the Asanko Gold Mine in Ghana, a strong gold price environment and continued exploration work at Esaase and Abore.

Chief Executive Officer Matt Badylak said on the company’s earnings call that Galiano produced 34,500 ounces of gold in the quarter, slightly above the midpoint of its first-half forecast. The company maintained its full-year production guidance of 140,000 to 160,000 ounces.

Badylak also highlighted a safety milestone, saying the company recorded no lost-time injuries in the quarter and extended its lost-time-injury-free period to more than 12 months. The Asanko Gold Mine marked its 10th year of continuous operations during the period and has produced more than 1.9 million ounces of gold over that time, he said.

Production Tracks Guidance as Mining Activity Ramps

Chief Operating Officer Michael Cardinaels said Esaase ramped up production in the first quarter as planned. Together with Abore, total tonnes mined increased 9% from the prior quarter, while ore tonnes mined rose 6%.

Cardinaels said mill feed in 2026 is planned from the Abore and Esaase pits. As the year progresses, strip ratios, particularly at Abore, are expected to decline, providing access to more ore and allowing the company to feed higher-grade material to the mill. He said that should support higher gold production in the second half of 2026.

At Nkran Cut 3, stripping continued during the quarter, with volumes mined increasing 8%. Cardinaels said material movement is expected to build through the year as additional equipment is mobilized.

Processing volumes were lower in the first quarter as expected because of a substantial plant maintenance program, including relines for both mills and replacement of the primary crusher pitman. Cardinaels said grades and recovery met or exceeded plan, resulting in gold production of 34,747 ounces and sales of just over 34,000 ounces.

“We are well-positioned to achieve the upper end of our previously communicated production range of 60,000 oz-70,000 oz for the first half of the year, and we remain on track to meet our full year guidance,” Cardinaels said.

Revenue Hits Record as Hedging Still Weighs on Earnings

Chief Financial Officer Matt Freeman said the strong gold price environment helped Galiano generate record revenue of $166 million and cash flow from operations of $47 million in the quarter.

Freeman said headline earnings continued to be affected by losses on hedges, with about 45,000 ounces left to settle. As production increases, he said those hedged ounces will represent a smaller percentage of production, allowing the company to participate more fully in gold prices. Excluding unrealized losses on hedges to be settled in the future, Galiano recognized adjusted net income of $0.11 per share.

The company ended the quarter with about $115 million in cash. Including a $75 million revolving credit facility added in the fourth quarter, which remains undrawn, total liquidity stood at approximately $190 million, management said.

Freeman said operating costs remained consistent period over period and have generally been well controlled. He noted that Galiano signed a four-year extension to its mining contract with Rabotec in April, which he said provides cost certainty while supporting compliance with Ghana’s local content requirements.

Management also addressed cost pressures from Ghana’s new sliding-scale royalty regime, enacted in March. Freeman said that at current gold prices, the royalty rate is 12%. He said the government provided a partial offset by reducing the Growth and Sustainability Levy from 3% to 1%.

Galiano reiterated 2026 all-in sustaining cost guidance of $2,300 to $2,600 per ounce. Freeman said the updated range reflects the new royalty regime and is “fundamentally” consistent with what the company previously outlined. He also said Galiano has seen recent diesel inflation related to the situation in the Middle East but does not expect a material impact on the mine’s overall 2026 cost structure.

Exploration Budget Increased for Esaase and Abore

Vice President, Exploration Chris Pettman said exploration activity began quickly in 2026, with drilling programs advancing at both Abore and Esaase. At Abore, the company completed 11,570 meters of a planned 30,000-meter step-out and infill drilling program during the first quarter, with another 3,000 meters completed in April.

Pettman said the Esaase resource conversion drilling program began in early February and is central to the company’s organic growth strategy. After initial positive results from the first 2,500 meters drilled in the first quarter, Galiano expanded the program to its full planned scope of 33,400 meters.

The company also increased its 2026 exploration budget from $17 million to $25 million. Pettman said Esaase is the Asanko Gold Mine’s largest deposit, with more than 1.7 million ounces of inferred and indicated resources and a reserve of 532,000 ounces.

According to Pettman, historic drilling below the current reserve shell gives Esaase the potential to quickly leverage higher gold prices. He said pit optimization studies have shown the deposit is sensitive to higher gold prices and that reserves could grow while maintaining strip ratios in line with the current reserve pit.

At Abore, Pettman said current step-out drilling has intersected mineralization up to 180 meters below the existing underground mineral resource. Infill drilling has also improved continuity across key mineralized zones outside the current resource. He said a new high-grade zone has been identified under the northern end of the Abore main pit and remains open along strike and at depth.

Galiano has submitted permit applications in Ghana for an underground exploration adit at Abore. Pettman said, pending external and internal approvals, the company’s goal is to begin construction of the portal and drive in 2027.

Management Points to 2027 Cash Flow Inflection

Badylak said the company expects a “meaningful cash flow inflection” beginning in January 2027 as production levels improve, hedges roll off and a deferred payment is settled in December. Freeman similarly said the end of 2026 marks an important inflection point, with 2027 and beyond expected to bring higher production and full exposure to gold prices after the current hedge program ends.

During the question-and-answer session, H.C. Wainwright analyst Heiko Ihle asked about equipment at Nkran Cut 3. Cardinaels said a third fleet arrived in April, including an additional PC2000 and six 777s, and that two more fleets are expected this year. He said production is expected to ramp up in the second, third and fourth quarters in line with budget expectations.

Badylak also said there had been no operational surprises over the prior 45 days. He noted that diesel prices were affecting operators globally, but said Ghana supply had not been negatively affected and current diesel costs were reflected in the company’s cash cost guidance.

Badylak closed the call by saying Galiano remains focused on meeting 2026 guidance, expanding reserves at Esaase and advancing underground potential at Abore. He said the company believes those efforts could extend mine life beyond the current eight years.

About Galiano Gold NYSEAMERICAN: GAU

Galiano Gold Incorporated is a Canada-based gold exploration and development company listed on the NYSE American under the symbol GAU. The company's primary focus is the acquisition, exploration and advancement of gold deposits in the Americas. Galiano Gold pursues a value-driven strategy to build gold resources by identifying high-potential projects, conducting systematic drilling programs and advancing resource definition toward a development decision.

Galiano Gold's flagship asset is the Oko West and Oko East gold project located in the Essequibo region of Guyana, where multiple oxide and primary gold mineralized zones have been outlined through extensive drilling.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.