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Cash cost and all-in sustaining cost measures
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Mine cash cost; mine cash cost of sales; and all-in sustaining cost are non-GAAP financial measures. Cash cost per tonne of ore processed; cash cost per GEO sold; and all-in sustaining cost per GEO sold are non-GAAP ratios. These measures capture the important components of the Company’s production and related costs. Management and investors utilize these metrics as an important tool to monitor cost performance at the Company’s operations. In addition, the Human Capital and Compensation Committee of the Board of Directors uses certain of these measures, together with other measures, to set incentive compensation goals and assess performance.
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The following table provides a reconciliation of the Company’s cash cost per tonne of ore processed to its cost of sales:
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| $ thousands, unless otherwise indicated | Chelopech | Ada Tepe | Vareš | ||||
| For the quarter ended March 31, 2026 | |||||||
| Ore processed | t | 506,500 | 147,385 | 79,081 | |||
| Cost of sales | 46,330 | 30,005 | 10,933 | ||||
| Add/(deduct): | |||||||
| Capitalized pre-commercial production operating costs | – | – | 22,289 | ||||
| Depreciation and amortization | (7,349 | ) | (15,518 | ) | (1,011 | ) | |
| Change in concentrate inventory | (1,322 | ) | 1,173 | 4,501 | |||
| Mine cash cost(1) | 37,659 | 15,660 | 36,712 | ||||
| Cost of sales per tonne of ore processed(2) | $/t | 91 | 204 | 138 | |||
| Cash cost per tonne of ore processed(2,3) | $/t | 74 | 106 | 464 | |||
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| $ thousands, unless otherwise indicated | Chelopech | Ada Tepe | Vareš | |||
| For the quarter ended March 31, 2025 | ||||||
| Ore processed | t | 532,851 | 147,291 | – | ||
| Cost of sales | 35,998 | 23,551 | – | |||
| Add/(deduct): | ||||||
| Depreciation and amortization | (7,973 | ) | (11,374 | ) | – | |
| Change in concentrate inventory | 114 | 323 | – | |||
| Mine cash cost(1) | 28,139 | 12,500 | – | |||
| Cost of sales per tonne of ore processed(2) | $/t | 68 | 160 | – | ||
| Cash cost per tonne of ore processed(2) | $/t | 53 | 85 | – | ||
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(1) Cash costs are reported in U.S. dollars, although the majority of costs incurred are denominated in non-U.S. dollars, and consist of all production related expenses including mining, processing, services, royalties and general and administrative.
(2) Represents cost of sales and mine cash cost, respectively, divided by tonnes of ore processed.
(3) Cash cost per tonne of ore processed at Vareš is calculated based on gross operating costs, prior to pre-commercial production cost capitalization, divided by total volumes of ore processed. On a net basis, cash cost was $182 per tonne of ore processed.
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The following tables provide, for the periods indicated, a reconciliation of the Company’s cash cost per GEO sold and all-in sustaining cost per GEO sold to its cost of sales:
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| $ thousands, unless otherwise indicated | Chelopech | Ada Tepe | Vareš | Consolidated | |||||
| For the quarter ended March 31, 2026 | |||||||||
| Cost of sales(1) | 46,330 | 30,005 | 10,933 | 87,268 | |||||
| Add/(deduct): | |||||||||
| Depreciation and amortization | (7,349 | ) | (15,518 | ) | (1,011 | ) | (23,878 | ) | |
| Treatment charges, transportation and other related selling costs(2) | 16,592 | 462 | 1,632 | 18,686 | |||||
| Mine cash cost of sales | 55,573 | 14,949 | 11,554 | 82,076 | |||||
| Rehabilitation related accretion and depreciation expenses(3) | 17 | 1,072 | 80 | 1,169 | |||||
| Allocated general and administrative expenses(4) | – | – | – | 22,087 | |||||
| Cash outlays for sustaining capital expenditures(5) | 3,868 | 602 | – | 4,470 | |||||
| Cash outlays for leases(5) | 341 | 212 | 917 | 1,470 | |||||
| All-in sustaining cost | 59,799 | 16,835 | 12,551 | 111,272 | |||||
| GEO sold(6) | oz | 39,959 | 11,960 | 14,066 | 65,985 | ||||
| Cost of sales per GEO sold(7) | $/oz | 1,159 | 2,509 | 777 | 1,323 | ||||
| Cash cost per GEO sold(7) | $/oz | 1,391 | 1,250 | 821 | 1,244 | ||||
| All-in sustaining cost per GEO sold(7) | $/oz | 1,497 | 1,408 | 892 | 1,686 | ||||
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| $ thousands, unless otherwise indicated | Chelopech | Ada Tepe | Vareš | Consolidated | ||||
| For the three months ended March 31, 2025 | ||||||||
| Cost of sales(1) | 35,998 | 23,551 | – | 59,549 | ||||
| Add/(deduct): | ||||||||
| Depreciation and amortization | (7,973 | ) | (11,374 | ) | – | (19,347 | ) | |
| Treatment charges, transportation and other related selling costs(2) | 14,079 | 533 | – | 14,612 | ||||
| Mine cash cost of sales | 42,104 | 12,710 | – | 54,814 | ||||
| Rehabilitation related accretion and depreciation expenses(3) | (1 | ) | 159 | – | 158 | |||
| Allocated general and administrative expenses(4) | – | – | – | 17,322 | ||||
| Cash outlays for sustaining capital expenditures(5) | 3,092 | 3,721 | – | 6,813 | ||||
| Cash outlays for leases(5) | 662 | 171 | – | 833 | ||||
| All-in sustaining cost | 45,857 | 16,761 | – | 79,940 | ||||
| GEO sold(6) | oz | 40,558 | 12,424 | – | 52,982 | |||
| Cost of sales per GEO sold(7) | $/oz | 888 | 1,896 | – | 1,124 | |||
| Cash cost per GEO sold(7) | $/oz | 1,038 | 1,023 | – | 1,035 | |||
| All-in sustaining cost per GEO sold(7) | $/oz | 1,131 | 1,349 | – | 1,509 | |||
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(1) Included in cost of sales were share-based compensation expenses of $1.6 million (2025 – $1.7 million) in the first quarter of 2026.
(2) Represents revenue deductions for treatment charges, refining charges, penalties, freight and final settlements to adjust for any differences relative to the provisional invoice.
(3) Included in cost of sales and finance cost in the condensed interim consolidated statements of earnings (loss).
(4) Represents an allocated portion of DPM’s general and administrative expenses, including share-based compensation expenses of $12.3 million (2025 – $9.5 million) for the first quarter of 2026, based on the mines’ proportion of total revenue, where applicable. Allocated general and administrative expenses, including corporate social responsibility expenses and excluding depreciation and amortization, are reflected in consolidated all-in sustaining cost and are not reflected in the cost measures for each of the mine operations.
(5) Included in cash used in investing activities and financing activities, respectively, in the condensed interim consolidated statements of cash flows.
(6) The Company uses conversion ratios for calculating GEO for its silver and copper production and sales, which are calculated by multiplying the volumes of metal sold, as applicable, by the respective average market metal prices, and dividing the resulting figure by the average market gold price.
(7) Represents cost of sales, mine cash cost of sales and all-in sustaining cost, respectively, divided by GEO sold.
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Adjusted net earnings (loss) and adjusted basic earnings (loss) per share
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Adjusted net earnings (loss) is a non-GAAP financial measure and adjusted basic earnings (loss) per share is a non-GAAP ratio used by management and investors to measure the underlying operating performance of the Company. Presenting these measures from period to period helps management and investors evaluate earnings trends more readily in comparison with results from prior periods.
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Adjusted net earnings (loss) are defined as net earnings (loss), adjusted to exclude specific items that are significant, but not reflective of the underlying operations of the Company, including:
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- impairment charges or reversals thereof;
- unrealized and realized gains or losses related to investments carried at fair value;
- significant tax adjustments not related to current period earnings; and
- non-recurring or unusual income or expenses that are either not related to the Company’s operating segments or unlikely to occur on a regular basis.
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The following table provides a reconciliation of adjusted net earnings to net earnings:
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| $ thousands, except per share amounts | Three Months | ||
| Ended March 31, | 2026 | 2025 | |
| Net earnings | 165,912 | 33,504 | |
| Add/(deduct): | |||
| Fair value loss on copper stream liability, net of income taxes of $nil | 2,326 | – | |
| 2025 Bulgarian levy, net of income tax recoveries of $2,438(1) | – | 21,938 | |
| Adjusted net earnings | 168,238 | 55,442 | |
| Basic earnings per share | $/sh | 0.75 | 0.19 |
| Adjusted basic earnings per share | $/sh | 0.76 | 0.32 |
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(1) Represents a one-time levy to the 2025 Bulgarian state budget in respect of both the Chelopech and Ada Tepe mines.
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Adjusted EBITDA
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Adjusted EBITDA is a non-GAAP financial measure used by management and investors to measure the underlying operating performance of the Company’s operating segments. Presenting these measures from period to period helps management and investors evaluate earnings trends more readily in comparison with results from prior periods. In addition, the Human Capital and Compensation Committee of the Board of Directors uses adjusted EBITDA, together with other measures, to set incentive compensation goals and assess performance.
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Adjusted EBITDA excludes the following from earnings before income taxes:
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- depreciation and amortization;
- interest income;
- finance cost;
- impairment charges or reversals thereof;
- unrealized and realized gains or losses related to investments carried at fair value; and
- non-recurring or unusual income or expenses that are either not related to the Company’s operating segments or unlikely to occur on a regular basis.
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The following table provides a reconciliation of adjusted EBITDA to earnings before income taxes:
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| $ thousands | Three Months | |||
| Ended March 31, | 2026 | 2025 | ||
| Earnings before income taxes | 189,115 | 38,552 | ||
| Add/(deduct): | ||||
| Depreciation and amortization | 24,632 | 20,172 | ||
| Finance costs | 1,088 | 712 | ||
| Interest income | (3,688 | ) | (8,568 | ) |
| Fair value loss on copper stream liability | 2,326 | – | ||
| 2025 Bulgarian levy(1) | – | 24,376 | ||
| Adjusted EBITDA | 213,473 | 75,244 | ||
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(1) Represents a one-time levy to the 2025 Bulgarian state budget in respect of both the Chelopech and Ada Tepe mines.
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Cash provided from operating activities, before changes in working capital
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Cash provided from operating activities, before changes in working capital, is a non-GAAP financial measure defined as cash provided from operating activities excluding changes in working capital as set out in the Company’s consolidated statements of cash flows. This measure is used by the Company and investors to measure the cash flow generated by the Company’s operating segments prior to any changes in working capital, which at times can distort performance.
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Free cash flow
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Free cash flow is a non-GAAP financial measure defined as cash provided from operating activities, before changes in working capital which includes changes in share-based compensation liabilities, less cash outlays for sustaining capital expenditures, mandatory principal repayments and interest payments related to debt and leases. Free cash flow excludes non-recurring or unusual income or expenses that are not related to the Company’s operating segments. This measure is used by the Company and investors to measure the cash flow available to fund growth related initiatives and capital expenditures, dividends and share repurchases.
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The following table provides a reconciliation of cash provided from operating activities, before changes in working capital and free cash flow to cash provided from operating activities:
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| $ thousands | Three Months | |||
| Ended March 31, | 2026 | 2025 | ||
| Cash provided from operating activities(1) | 154,509 | 54,926 | ||
| Excluding: | ||||
| Changes in working capital(1) | 53,383 | 8,743 | ||
| Cash provided from operating activities, before changes in working capital | 207,892 | 63,669 | ||
| Fair value loss on copper stream liability | 2,326 | – | ||
| 2025 Bulgarian levy(2) | – | 24,376 | ||
| Cash outlays for sustaining capital expenditures(3) | (4,317 | ) | (7,266 | ) |
| Principal repayments related to leases(3) | (1,978 | ) | (1,324 | ) |
| Interest payments(3) | (606 | ) | (327 | ) |
| Free cash flow | 203,317 | 79,128 | ||
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(1) Excluded $173.2 million during the first quarter of 2025 related to the DPM Tolling Agreement.
(2) Represents an accrual of the one-time levy to the 2025 Bulgarian state budget in respect of both the Chelopech and Ada Tepe mines during the first quarter of 2025.
(3) Included in cash used in investing and financing activities, respectively, in the condensed interim consolidated statements of cash flows.
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Average realized metal prices
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Average realized metal prices are non-GAAP ratios used by management and investors to highlight the price actually realized by the Company relative to the average market price, which can differ due to the timing of sales, hedging and other factors.
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Average realized metal prices represent the average per unit price recognized in the Company’s consolidated statements of earnings (loss) prior to any deductions for treatment charges, refining charges, penalties, freight and final settlements to adjust for any differences relative to the provisional invoice.
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The following table provides a reconciliation of the Company’s average realized metal prices to its revenue:
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| $ thousands, unless otherwise stated | Three Months | |||
| Ended March 31, | 2026 | 2025 | ||
| Total revenue | 310,364 | 144,147 | ||
| Add/(deduct): | ||||
| Treatment charges and other deductions(1) | 18,686 | 14,612 | ||
| Antimony revenue | (38 | ) | – | |
| Gross revenue | 329,012 | 158,759 | ||
| Revenue from gold | 224,066 | 134,528 | ||
| Payable gold in concentrates sold | oz | 45,219 | 44,789 | |
| Average realized gold price | $/oz | 4,955 | 3,004 | |
| Revenue from silver | 55,318 | 1,764 | ||
| Payable silver in concentrates sold | oz | 610,190 | 49,428 | |
| Average realized silver price | $/oz | 90.66 | 35.69 | |
| Revenue from copper | 38,538 | 22,467 | ||
| Payable copper in concentrates sold | Klbs | 6,554 | 5,163 | |
| Average realized copper price | $/lb | 5.88 | 4.35 | |
| Revenue from zinc | 7,316 | – | ||
| Payable zinc in concentrates sold | Klbs | 4,756 | – | |
| Average realized zinc price | $/lb | 1.54 | – | |
| Revenue from lead | 3,774 | – | ||
| Payable lead in concentrates sold | Klbs | 4,405 | – | |
| Average realized lead price | $/lb | 0.86 | – | |
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(1) Represents revenue deductions for treatment charges, refining charges, penalties, freight and final settlements to adjust for any differences relative to the provisional invoice.
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