Endeavour Silver (EXK) Q4 2025 Earnings Call Summary

1Key Financial Results and Metrics

Production: 11 million ounces of silver equivalent in 2025, a 48% increase from 2024. Q4 production was 2 million ounces of silver and 14,000 ounces of gold, totaling nearly 4 million silver equivalent ounces (up 146% YoY).

Revenue: Record revenue of $468 million, up 115% from 2024.

Cost of Sales: $385 million, leading to mine operating earnings of $83 million.

Cash Flow: Mine operating cash flow before taxes was $156 million, up 116% YoY.

Adjusted Net Earnings: $4.8 million or $0.02 per share, impacted by derivative losses and higher financing costs.

Direct Operating Costs: Increased to $19 per ounce of payable silver due to production profile changes.

Cash Position: $215 million as of December 31, 2025.

2Strategic Updates and Business Highlights

Acquisitions and Developments:

Acquired Kolpa in May 2025.

Achieved commercial production at Terronera in October 2025.

Sold Bolanitos Mine, closing in January 2026.

Expansion Plans:

Increasing Kolpa's capacity from 2,000 to 2,500 tonnes per day.

Investing $68 million in Pitarrilla for exploration and feasibility studies.

Market Positioning: Positioned to benefit from high silver prices (silver above $90, gold above $5,000) and increased industrial demand.

3Forward Guidance and Outlook

Cost Expectations: Anticipate a reduction in direct operating costs as operations stabilize and transition to liquefied natural gas (LNG) in Q2 2026.

Production and Cost Projections:

Expect all-in sustaining costs to decrease throughout 2026, with guidance of $28-$29 per ounce.

Gradual improvement in grades and throughput at Terronera expected in the second half of 2026.

Pitarrilla Development: Feasibility study targeted for completion in Q3 2026, with a construction decision anticipated in early 2027.

4Bad News, Challenges, or Points of Concern

Operational Challenges:

Temporary suspension of operations at Terronera due to security events in Mexico.

Initial ramp-up issues at Terronera led to higher costs and lower grades than expected.

Cost Pressures: Rising costs associated with higher royalties and duties as silver prices increase, impacting margins.

Security Concerns: Ongoing volatility in Jalisco may necessitate increased security measures and could affect operational stability.

5Notable Q&A Insights

Operational Improvements: Management reported improvements in throughput and recovery rates at Terronera since the start of commercial production.

Cost Management: Direct costs per ton expected to improve as the company transitions to LNG and stabilizes operations.

Hedging Strategy: The company has hedged gold but maintains a policy of remaining unhedged on silver to capture upside potential.

Permitting and Expansion: Kolpa's expansion is on track, with expected completion of construction permits soon. Pitarrilla's tailings storage facility permit is a key focus, with a target for Q1 2027 approval. Overall, Endeavour Silver's Q4 2025 results reflect significant growth and strategic positioning in a favorable market, despite facing operational challenges and external risks. The company remains focused on optimizing costs and advancing key projects to enhance shareholder value.