Galiano Gold NYSEAMERICAN: GAU reported higher gold production and stronger cash generation in the third quarter of 2026, as improved processing rates and grades helped the company maintain its full-year production and cost outlook.
The company produced 40,922 ounces of gold, up 19% from the second quarter, and generated $172 million in revenue on sales of just over 40,000 ounces. Operating cash flow rose to $57 million from $40 million a year earlier, Chief Financial Officer Matt Freeman said on the earnings call.
President and Chief Executive Officer Matt Badylak said the company was positioned to meet its 2026 guidance while continuing to invest in the Asanko Gold Mine. Galiano had no debt and reported $87 million in cash at September 30, with its $75 million revolving credit facility undrawn.
Production and financial performance improve
Chief Operating Officer Michael Cardinaels said Galiano milled 1.4 million tons during the quarter, 11% more than in the second quarter, as plant availability reached 93%. The average mill feed grade also increased 11%, to 1 gram per ton, while recovery held steady at 90%.
Abore remained the company’s primary ore source, contributing 1.4 million tons at an average grade of 1.1 grams per ton, or about 82% of total ore mined. Grades at Abore rose 9% from the prior quarter as mining moved deeper, Cardinaels said. Esaase supplied another 0.3 million tons at an average grade of 0.8 grams per ton.
Galiano produced just over 110,000 ounces through the first nine months of the year. Cardinaels said the company expects Abore grades to continue at current levels in the fourth quarter and into 2027, with potential for further improvement as mining moves deeper. Badylak said fourth-quarter grades would probably be similar to those seen in the third quarter.
Freeman said the average realized gold price was $4,247 per ounce before the impact of hedges. Adjusted EBITDA was $93.3 million, basic earnings per share were $0.15 and adjusted earnings per share were $0.09.
Net income attributable to shareholders was $40 million, compared with a $39 million loss a year earlier. Freeman attributed the improvement mainly to higher revenue from increased gold sales and prices, partly offset by royalties.
All-in sustaining costs fell 5% from the second quarter to $2,346 per ounce, primarily because of higher gold sales, partly offset by increased sustaining capital for expansion of the tailings storage facility. Year-to-date costs were $2,391 per ounce, and Galiano maintained its annual guidance of $2,300 to $2,600 per ounce.
Hedge program nears completion
Galiano settled 22,500 ounces under its gold hedge program during the quarter, leaving 15,000 ounces to be settled in the fourth quarter. Freeman said completing those deliveries would allow the company’s financial results to fully participate in the gold price beginning in 2027.
Badylak said the end of the hedge book, together with higher production, should support strong operating cash flow next year. He said the company had previously expected slightly higher 2027 production on the back of higher grades, but was still working through cost estimates and expected to provide guidance early in the year.
Asked about input costs, Freeman said the company was monitoring elevated diesel prices but remained comfortable with its cost structure. He also noted some labor cost pressure in Ghana, while saying he did not expect a particular change in site headcount.
Development and exploration advance
At Nkran Cut 3, additional equipment helped increase development waste movement by a further 40% to 8.5 million tons during the quarter, Cardinaels said. Galiano invested $24.6 million in pre-stripping, bringing the nine-month total to $60.2 million. Mining rates are expected to remain steady in the fourth quarter.
After the quarter, the company secured extensions to the Abirem and Miradani mining leases. Badylak said the extensions provide greater operating certainty and support the current life-of-mine plan.
Vice President of Exploration Chris Pettman said Galiano completed an expanded infill drilling program at Esaase, with 32,982 meters drilled in total. The program was designed to convert inferred open-pit mineral resources to the indicated category and could support a future open-pit expansion. Data review and modeling are underway.
At Abore, drilling resumed late in the third quarter after being paused to prioritize Esaase. Galiano had completed approximately 20,600 meters of a planned 32,000-meter program through September and expects to finish in the fourth quarter. The company is targeting a mineral resource and reserve update in the first quarter of 2027.
Galiano also received the regulatory approvals needed to construct a planned exploration adit at Abore. Badylak said the company was seeking to select a mining contractor in the fourth quarter and was targeting groundbreaking in late first quarter or early second quarter of 2027, subject to contractor selection. He declined to provide a cost estimate before the tender process is complete.
The planned adit is about 2 kilometers long. Pettman said some underground drilling could begin as construction progresses, rather than waiting until the full ramp is complete. Badylak said a comprehensive underground study remained some time away because further drilling and resource conversion would be needed.
About Galiano Gold (NYSEAMERICAN:GAU)
Galiano Gold Inc is a Canadian gold producer and exploration company focused on the acquisition, development and operation of gold assets in West Africa. The company's primary asset is the Asanko Gold Mine in Ghana, which produces gold through open-pit mining and conventional processing operations.
Galiano Gold operates the Asanko Gold Mine through a partnership with the government of Ghana, which holds a minority interest. The mine is located in Ghana's Ashanti Region, an established gold-producing area, and includes multiple open-pit deposits, processing facilities and additional exploration opportunities intended to support future mineral resource growth.
The company was formerly known as Asanko Gold Inc and adopted the Galiano Gold name in 2020.
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