Summary of Pan American Silver (PAAS) Q2 2026 Earnings Call

1Key Financial Results and Metrics

Revenue: $1.1 billion; attributable revenue (including 44% interest in Juanicipio): $1.3 billion.

Net Earnings: $305 million ($0.72 per share); adjusted earnings: $0.73 per share.

Cash Flow: Cash flow from operations was $320 million; attributable cash flow from operations: $418 million; attributable free cash flow: $344 million.

Tax Expense: $179 million; higher-than-expected tax payments due to increased profitability and a tax rate of approximately 37%.

Shareholder Returns: Returned a record $300 million in share buybacks and dividends; repurchased over 7 million shares in 2026.

2Strategic Updates and Business Highlights

Silver Production: Attributable silver production of 6.5 million ounces, at the high end of guidance; on track for full-year guidance of 25 million to 27 million ounces.

Gold Production: Attributable gold production of approximately 166,000 ounces, below guidance; revised full-year gold production expected at the low end of 700,000 to 750,000 ounces.

Growth Projects: Progress on La Colorada's 588 decline to access the Skarn deposit; ongoing optimization at Jacobina, including potential new mining methods and plant upgrades.

Timmins Project: Advancing the first phase, with a preliminary economic assessment expected in the first half of 2027.

Escobal Mine: Ongoing ILO 169 consultation process with no timeline for restart.

3Forward Guidance and Outlook

Production Guidance: Reaffirmed full-year production guidance for silver and gold; gold production expected to be lower due to challenges at Jacobina and El Peñón.

Tax Guidance: Increased guidance for income taxes paid to $585 million to $635 million for 2026.

Capital Expenditures: Maintained guidance of $240 million to $255 million for project capital, with expectations to catch up on spending in the second half of the year.

4Bad News, Challenges, or Points of Concern

Jacobina Production Issues: Seismic activity led to a downward revision of gold production guidance by approximately 10,000 ounces; implementation of precautionary measures may affect short-term production.

El Peñón Challenges: Lower continuity in certain secondary structures resulted in reduced gold production guidance while maintaining silver production.

Weather Impacts: El Niño conditions have affected operations in Chile and Argentina, leading to challenges in site access and production.

Tax Variability: Higher-than-expected tax rates and payments due to increased profitability and true-ups from prior periods may impact future earnings.

5Notable Q&A Insights

Jacobina's Long-term Outlook: Management reassured that the seismic issues are short-term and that the mine has a long reserve life, with ongoing optimization expected to enhance future production.

El Peñón's Production Dynamics: The company clarified that gold and silver grades can vary significantly between structures, impacting production guidance.

Escobal Mine's Consultation Process: Ongoing discussions with government and community representatives are focused on typical mining concerns, but no new developments were reported.

Future Shareholder Returns: The commitment to return up to $1 billion to shareholders remains intact, with a focus on share buybacks and dividends. Overall, Pan American Silver demonstrated strong financial performance in Q2 2026, despite facing challenges in gold production and external weather impacts. The company remains focused on strategic growth initiatives and maintaining robust shareholder returns.