Kinross Gold NYSE: KGC reported a strong start to 2026, with management pointing to robust operating margins, a strengthening balance sheet, and continued progress across a pipeline of mine-life extensions and growth projects. On the company’s first-quarter conference call, executives also reiterated full-year production, cost, and capital guidance and detailed how hedging and grade enhancement strategies are intended to help offset cost pressures.
Record free cash flow and capital returns
CEO Paul Rollinson said Kinross followed its “outstanding performance in 2025” with another strong quarter, delivering its “fourth consecutive quarter of record free cash flow.” Kinross reported record attributable free cash flow of approximately $838 million to $840 million in the quarter, supported by higher gold prices, operating execution, and what Rollinson described as a culture of “technical excellence and financial discipline.”
Executive Vice-President Andrea Freeborough said adjusted operating cash flow was a record $1.1 billion and adjusted earnings were $0.71 per share. She noted that earnings and adjusted earnings were affected by the timing of a $65 million withholding tax expense recorded in the first quarter, which “caused our earnings per share to be lower by $0.05” and pushed the effective tax rate higher in the period. Freeborough said Kinross expects the effective tax rate to be lower from the second through fourth quarters and for the full year to fall within guidance of 28% to 33%.
Despite roughly $450 million in tax payments in the quarter, Freeborough said Kinross added $440 million in cash after funding planned capital spending and returning $300 million to shareholders. Kinross ended the quarter with $2.2 billion in cash, $3.9 billion of total liquidity, and $1.4 billion in net cash.
Freeborough said the company is targeting returning about 40% of free cash flow to shareholders in 2026 through dividends and repurchases. In the first quarter, Kinross repurchased $250 million of shares (about 7.7 million shares, or 0.6% of shares outstanding), and she said an additional $50 million was repurchased after quarter-end. Freeborough added that since restarting buybacks a year ago, the company has repurchased about $900 million in shares, representing “over 3%” of its share count.
Production and cost performance, with guidance reaffirmed
Kinross produced 493,000 gold equivalent ounces in the first quarter. Freeborough said cost of sales of $1,380 per ounce and all-in sustaining costs (AISC) of $1,732 per ounce were “on plan.” She also said margins were a record $3,476 per ounce and “outpaced the increase in the gold price.”
Management reiterated full-year guidance of 2.0 million ounces at a cost of sales of $1,360 per ounce and AISC of $1,730 per ounce, alongside capital guidance of $1.5 billion. Freeborough said second-quarter production is expected to be in line with the first quarter, with the second half “slightly higher than the first half” to meet full-year guidance.
On inflation, Freeborough told analysts Kinross embedded a 5% inflation factor in its cost guidance and said the company remains on track for that assumption. Rollinson added that capital inflation is expected to be a factor in future updates for both Great Bear and Lobo-Marte, describing inflation as a “macro effect” the company will largely be a “price receiver on.”
Site-level highlights: Paracatu and Tasiast lead; U.S. expected to be stronger in 2H
Chief Operating Officer Claude Schimper highlighted operational performance at key assets. Paracatu produced 161,000 ounces, with Schimper attributing the quarter to “record mill recoveries” driven by continuous improvement initiatives across the processing plant. He said Paracatu remains on track for 600,000 ounces at a target cost of sales of $1,240 per ounce.
At Tasiast, Schimper said production of 130,000 ounces rose quarter-over-quarter and cost of sales fell to $990 per ounce due to strong grades. He said continuous improvement at the site’s solar facility resulted in 15.5 gigawatt-hours of power generation, accounting for 23% of site power in the quarter and offsetting 3.5 million liters of hydrocarbons. In Q&A, Schimper said grades were elevated as the mine finished “West Branch ore” and processed some stockpile inventory; he said grades are expected to “taper off for the rest of the year, slightly lower.”
At La Coipa, Schimper said production was 54,000 ounces at a cost of sales of $1,526 per ounce, with lower output due to a planned 16-day mill shutdown. He said grades and production are expected to increase in the second and third quarters as Phase 7 ore is mined.
In the U.S., combined sites delivered 148,000 ounces at a cost of sales of $1,982 per ounce, benefiting from “strong contributions from Fort Knox and Manh Choh in Alaska,” Schimper said. He noted Round Mountain produced 26,000 ounces as it processed “lower grade, lower recovery stockpile feed” ahead of a planned transition to higher grade ore from Phase X in the second half. Responding to a question on second-half strength, management pointed to the U.S., including Round Mountain as it moves “into the heart of Phase X.”
Hedging, oil sensitivity, and supply chain commentary
Freeborough provided additional color on oil sensitivity, noting fuel represents about 11% of total costs and that 2026 guidance assumed $70 per barrel oil. While the company’s stated sensitivity is $3 per ounce on cost of sales for every $10 per barrel change, she said in the current volatile environment the estimated sensitivity for 2026 is about $10 per ounce for every $10 per barrel change when considering factors affecting refined products. She added that if oil stayed at $100 for the remainder of the year, the expected impact would be about $20 per ounce on full-year AISC—about 1%—and that potential secondary inflation impacts could add another $10 per ounce, for a total of $30 per ounce (less than 2%).
Freeborough said Kinross has “favorable oil hedge positions” and that in 2026 the company has hedged 63% of the oil component of fuel consumption at its U.S. and Tasiast operations at an average of $62 per barrel, which accounts for about 75% of company-wide fuel consumption. In Q&A, management clarified that equates to roughly 50% hedged on a company-wide basis for 2026, with 2027 hedging at 42% for the U.S. and Tasiast (about 30% company-wide), which Rollinson said the company will look to “chip away at.”
Schimper also said Kinross was not experiencing supply disruptions for fuel or key consumables, and he told analysts the company has been engaging suppliers and has not seen “any tension” for items such as explosives, cyanide, and lime. Kinross added it is targeting more fuel in-country for Tasiast, but said the inventory buildup has not been significant.
Project pipeline: permitting milestones at Great Bear and Lobo-Marte; U.S. development advances
Chief Technology Officer William Dunford said Kinross’ project pipeline is supported by “over 27 million ounces” of measured and indicated resources and “an additional 17 million ounces of inferred,” calculated at $2,500 per ounce. He highlighted progress on three U.S. projects announced earlier in the year.
- Phase X (Round Mountain): Dunford said Kinross received all major operational permits ahead of schedule, including a federal permit to increase the underground mining rate above 3,000 tons per day. Underground development has reached 7.2 kilometers and is “slightly ahead of schedule,” which he said de-risks the path to first production in 2028.
- Bald Mountain (Redbird): Dunford said mining is advancing, with construction of processing infrastructure for Redbird extensions and detailed engineering of the SART plant progressing.
- Curlew (Washington): Dunford said a mild winter supported progress on infrastructure, detailed engineering for mill refurbishment is largely complete, procurement is underway, and a contractor has been selected. Mobilization is set to begin in the second quarter, and Kinross pulled some underground development into the first quarter to de-risk the mine plan and first production. He also cited exploration results at North South and Roadrunner, including intersections of 12.5 meters at 7 g/t and 4.5 meters at 8.5 g/t at North South, and 2.4 meters at 9 g/t at Roadrunner.
On Great Bear in Ontario, President Geoff Gold said Kinross received remaining permits for its advanced exploration program from the Ontario Ministry of the Environment, Conservation and Parks. He said the company submitted the third and final phase of the federal impact statement in the first quarter and continues to advance provincial permitting under Ontario’s “One Project, One Process” framework. Gold said the company would require the final impact assessment report and certain provincial early works and construction permits in spring 2027 to maintain targeted first production in late 2029. He also said negotiations on impact and benefits agreements with Lac Seul and Wabauskang First Nations are advancing based on a signed, confidential memorandum of understanding.
Dunford said final advanced exploration permits allow Kinross to commence construction of the advanced exploration (AEX) decline this summer, providing underground drilling access for resource extension and delineation. In Q&A, he said the team expects “August or September” to begin blasting and getting underground, with deeper exploration progressing over time and not reaching the “very bottom of the ore body” for “a number of years.” Dunford added that detailed engineering on the main project is about 45% complete, and the company plans to update initial capital in early 2027 once detailed engineering is complete, including the impact of inflation since the 2024 PEA and any scope changes such as enhanced water management.
In Chile, Rollinson said Kinross submitted the environmental impact assessment for Lobo-Marte earlier in April, formally initiating the permitting process. Dunford said Lobo-Marte is expected to be a long-life heap leach operation with potential to produce 4.7 million ounces over a 16-year mine life, with potential annual production of 300,000 to 400,000 ounces. Management said it is updating and reviewing the 2021 feasibility study and plans to provide a more detailed update in the second half of the year. On timing, Dunford said the EIA process is “a couple of years,” and Rollinson said additional approvals, early works, and construction would be “at a minimum” another two years, reiterating the company’s expectation that Lobo-Marte comes “in the early 2030s” behind Great Bear.
Rollinson also discussed water strategy in Chile, saying the company’s base case for Lobo-Marte is to use existing permitted pumping from wells currently supplying La Coipa, which are “physically closer to Lobo-Marte,” supported by a long history of monitoring. Dunford said the EIA was designed around the same water consumption used at La Coipa, with modeling and data included in the submission.
In closing remarks, Rollinson said Kinross is “well positioned to meet our targets in 2026,” citing ongoing capital returns, balance sheet strength, project advancement, and exploration aimed at extending mine lives and supporting future production.
About Kinross Gold NYSE: KGC
Kinross Gold Corporation NYSE: KGC is a Toronto-based precious metals mining company primarily focused on the exploration, development and production of gold, with silver recovered as a by-product at some operations. The company's activities span the full mining lifecycle, including discovery and resource delineation, mine construction and operation, ore processing, and eventual site reclamation and closure. Kinross sells refined gold produced at its processing facilities and manages associated logistics and processing arrangements to deliver metal to market.
Kinross operates a portfolio of producing mines and development projects across multiple regions, with a significant presence in the Americas and West Africa.
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