What Avino Silver & Gold Mines (ASM) Said on Its Q3 Earnings Call

Key Points

• Q3 production and cash flow improved: Silver production rose 15% year over year to 303,000 ounces, while operating cash flow increased 52% to $12.7 million. Avino reported $33.4 million in revenue and $6.1 million in net income.
• La Preciosa is moving toward production mining: The mine exceeded 450 tons per day, with more than 3,000 meters of underground development completed. Avino expects to begin production-style mining in the coming quarter, while noting current development costs are elevated and La Preciosa is not yet in commercial production.
• Outlook and growth plans: Avino revised its 2026 silver-equivalent production guidance to 2.2 million–2.5 million ounces and set cash cost and all-in sustaining cost midpoints of $23 and $31 per ounce. Longer term, it is evaluating processing and plant expansions, with a goal of exceeding 10 million silver-equivalent ounces annually.

Avino Silver & Gold Mines TSE: ASM reported higher silver production and operating cash flow in the third quarter of 2026, while advancing development at La Preciosa toward production mining.

The company generated $33.4 million in revenue and $6.1 million in net income, or $0.03 per diluted share, Chief Financial Officer Nathan Harte said on the earnings call. Adjusted earnings were $14.3 million, or $0.08 per share. All figures are in U.S. dollars unless otherwise noted.

Avino also revised its full-year production outlook to 2.2 million to 2.5 million silver equivalent ounces and updated several cost targets as it processed more development material from La Preciosa than initially forecast.

Production and Financial Results

Third-quarter production totaled 303,000 ounces of silver, just under 2,000 ounces of gold and 1.1 million pounds of copper, for a combined 583,000 silver equivalent ounces. Silver production rose 15% from a year earlier, President and CEO David Wolfin said.

The Avino Mine contributed 477,000 silver equivalent ounces, while development production at La Preciosa increased 5% from the second quarter to approximately 106,000 silver equivalent ounces. The La Preciosa total included 91,000 ounces of silver and 166 ounces of gold.

Silver accounted for 55% of revenue, with the metal sold at an average realized price of $63.33 per ounce, Harte said. Gross profit margin was 44%, or 49% on a cash basis excluding depreciation and depletion. Harte said a weaker U.S. dollar against the Mexican peso and additional mine preparation costs at La Preciosa weighed on margins.

Operating cash flow rose 52% from the third quarter of 2025 to $12.7 million. Free cash flow was $6 million, excluding La Preciosa exploration and development costs but including exploration and capital equipment spending at the Avino Mine. The company ended the quarter with $138 million in cash and $142 million in working capital, after making a final $8.75 million payment to extinguish royalties issued as part of the La Preciosa acquisition.

La Preciosa Transition and Costs

Wolfin said mining and processing rates at La Preciosa exceeded 450 tons per day during the quarter. More than 3,000 meters of underground development have been completed, and preparation on level 3 is nearing completion ahead of long-hole production mining at the La Gloria and Abundancia veins.

The transition is expected to provide higher-grade material than the development ore processed so far. Year-to-date processing of La Preciosa development material exceeded the company’s plan, partly because a second mill circuit became available earlier than scheduled in the second quarter. Grades were below plan, but elevated silver prices supported processing of the additional lower-grade material, Wolfin said.

Harte said La Preciosa development was more than 30% above budget during the quarter because of additional equipment and increased productivity. He cautioned that current costs include preparation for future mining and are not indicative of long-term expectations. La Preciosa is not yet in commercial production.

At current prices, Avino plans to continue processing development material rather than setting it aside, Harte said. He added that the company expects to begin production-style mining in the coming quarter. Senior Vice President of Technical Services Peter Latta said higher grades and planned equipment improvements should help improve recoveries at La Preciosa.

Guidance and Growth Plans

Alongside its revised production outlook, Avino set midpoints of $23 per ounce for full-year cash costs and $31 per ounce for all-in sustaining costs. The company also revised its all-in sustaining cost midpoint to $90 per ton, citing the greater volume of La Preciosa development material being processed. Full-year cash cost guidance per ton was unchanged, Harte said.

Consolidated cash cost per ton was $71.40 in the quarter. At the Avino Mine, cash cost was $59.60 per ton and all-in sustaining cost was just under $80 per ton, Harte said.

Avino aims to reach a mining rate of 500 tons per day at La Preciosa and complete planned drilling programs at both properties this year. Latta said the company is working on an updated resource and reserve model for next year and is considering a prefeasibility study for La Preciosa, though he did not provide a release date.

For longer-term growth, the company is evaluating a standalone processing facility at La Preciosa and expansion of the existing Avino plant. Wolfin said Avino’s longer-term objective is to exceed 10 million silver equivalent ounces of annual production.

About Avino Silver & Gold Mines (TSE:ASM)

Avino is a silver producer from its wholly owned Avino Mine near Durango, Mexico. The Company's silver, gold and copper production remains unhedged. The Company intends to maintain long-term sustainable and profitable mining operations to reward shareholders and the community alike through our growth at the historic Avino Property and the strategic acquisition of the adjacent La Preciosa which was finalized in Q1 2022. Early in 2024, the Pre-feasibility Study on the Oxide Tailings Project was completed.

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