FSM — Fortuna Mining Corp.

Fortuna Mining Corp. Q1 2026 Earnings Call Summary

1. Key Financial Results and Metrics

• Sales: $342 million, a record high driven by increased gold and silver prices.
• Adjusted Net Income: $111 million ($0.36 per share), up 64% quarter-over-quarter and 200% year-over-year.
• Adjusted EBITDA: $219 million, also a record for the company.
• Free Cash Flow: $174 million, the strongest quarterly cash generation to date.
• Gold Equivalent Production: 72,900 ounces.
• All-in Sustaining Cost (AISC): $2,107 per gold equivalent ounce, with $122 per ounce attributed to external factors (royalties and share-based compensation).
• Liquidity: Total liquidity of $816 million, including $493 million in net cash.

2. Strategic Updates and Business Highlights

• Safety Performance: Zero lost time injuries for five consecutive quarters.
• Production Growth Plans: Targeting approximately 60% growth in annual gold production over the next 24 months, aiming for 0.5 million ounces through the Seguela mine expansion and Diamba Sud project.
• Mineral Reserves Growth: Proven and probable reserves increased by 50% year-over-year to 3 million gold ounces.
• Operational Highlights:
  • Seguela produced 42,016 ounces of gold, exceeding expectations.
  • Lindero in Argentina produced 21,545 ounces, showing a 12% increase from 2025.
  • Caylloma in Peru maintained stable performance with 258,000 ounces of silver produced.

3. Forward Guidance and Outlook

• Production Guidance: Remains on track to meet full-year 2026 guidance based on strong Q1 performance.
• Upcoming Milestones: Completion of feasibility studies for Diamba Sud and Seguela expansion expected in May, with environmental approvals anticipated imminently.
• Cost Management: Expecting AISC at Lindero to trend towards $1,300 per ounce by Q4 2026 as temporary costs are removed.

4. Challenges and Points of Concern

• Cost Pressures: While inflation has not significantly impacted overall costs, there are rising input costs for certain materials, particularly in Peru.
• Tax Rate Increase: Effective tax rate expected to rise to the high-30% range for 2026 due to changes in deferred tax positions.
• Geopolitical Risks: Expansion into new regions like Guyana introduces potential geopolitical risks, although management believes they can mitigate these through diversified operations.

5. Notable Q&A Insights

• Cost Management at Seguela: Management attributed lower cash costs to increased production, accounting aspects, and a favorable stripping ratio.
• Diamba Sud Permitting: Environmental approval expected imminently, with exploitation permits anticipated mid-year.
• Acquisition Strategy: Currently focused on pre-development stage opportunities rather than mature assets, reflecting a cautious approach to acquisitions.
• Exploration Activities: Active in greenfields exploration in Côte d’Ivoire, Guinea, and Senegal, with a shift of resources from Mexico to Guyana.

This summary encapsulates Fortuna Mining Corp.'s strong start to 2026, highlighting record financial performance, strategic growth initiatives, and challenges faced in a dynamic market environment.