Allied Gold Corporation press release

Allied Gold Reports Q2 2026 Results, Nears Kurmuk Start-Up and Strengthens Financial Position

2026-08-05

TSX - Toronto Stock Exchange · Gold · Canada · Corporate Finance

TORONTO, Aug. 05, 2026 (GLOBE NEWSWIRE) -- Allied Gold Corporation (TSX: AAUC) (NYSE: AAUC) (“Allied” or the “Company”) herein provides its financial and operational results for the second quarter of 2026. The Company produced 97,429 ounces of gold in the second quarter of 2026. Performance was in line with expectations and operating plans, representing a 7% increase over the prior year comparative production. All-in Sustaining Costs (“AISC”)(1)for the quarter were $2,192 per ounce sold, in line with expectations. These results reflect continued momentum heading into the second half of the year, which is planned with increased levels of production mostly coming from operational improvements and mine sequencing at producing mines and the start-up of production at its newest operation, the Kurmuk Mine.

SECOND QUARTER HIGHLIGHTS

Financial Results Highlights

Earnings: Second quarter net earnings of $37.2 million, or $0.29 per basic share and $0.27 per fully diluted share. Second quarter adjusted earnings(1)of $55.4 million, or $0.44 per basic share and $0.40 per fully diluted share.

Cash Flows and EBITDA:

Net cash used in operating activities for the quarter was $67.4 million. Operating cash flows before income tax paid and movements in working capital were a strong inflow of $133.0 million. EBITDA(1)and Adjusted EBITDA(1) for the three months ended June 30, 2026, were $165.0 million and $166.9 million, respectively.

Strong Financial Position: As of June 30, 2026, the Company had cash and cash equivalents of $192.2 million. Cash balances are expected to increase through the remainder of the year, supported by reduced capital expenditure at the Kurmuk Mine as development efforts come to an end, and increased production from operating mines and start of production from the Kurmuk Mine. During the second quarter, the amount of $158.9 million was paid for expansionary capital, particularly in relation to development of the Kurmuk Mine, and $129.7 million was paid in cash taxes for the preceding year. Cash taxes were in line with expectations and normally, cash taxes for a preceding year are paid in the second quarter of the following year. Liquidity will be further strengthened by the proceeds from the recently announced $295 million strategic investment by Zijin Gold, as described in the _Transaction with Zijin Gold_section below.

Operational Highlights

SecondQuarter Production:The Company produced 97,429 ounces of gold in the second quarter, in line with plan and annual guidance for its operating mines, and representing a 7% increase over the prior year comparable period.

SecondQuarter Sales: Sales of 93,970 gold ounces, differing slightly from production due to the timing of shipments of production and the sale of end-of-year inventory.

Performance by Asset:

At Sadiola, production of 48,080 ounces in the second quarter was aligned with the production plan. Sequential increases in production are expected over the coming quarters, driven by higher grades and throughput. At Bonikro, production of 31,471 ounces in the second quarter was substantially higher than the second quarter of the previous year, due to mine sequencing and a standout performance in relation to the production plan. At Agbaou, production of 17,878 ounces in the second quarter was in line with plan and the mine sequence.

Costs In Line with Plan: AISC(1)of $2,192 per ounce sold on a consolidated basis for the second quarter were in line with plan. The estimated gold price impact on second quarter AISC(1)as a result of higher royalties due to average gold prices of approximately $4,380, versus gold price assumed in guidance of $4,250, amounts to approximately $20 per ounce.

Strong AISC Margins:Lower AISC, together with realized gold prices for spot sales of approximately $4,380 per ounce in the second quarter, resulted in strong AISC margins demonstrating the strong operating cash flow generation abilities of the Company.

Tracking Production Guidance: Aggregate production for the first half of 2026 of 193,445 gold ounces positions Allied well to meet previously provided production guidance relating to its producing mines of 385,000 to 425,000 gold ounces. As previously disclosed, production from Allied’s producing mines, particularly at Sadiola, is expected to be weighted toward the second half of the year with sequential increases in production expected in the upcoming quarters. The development of the Kurmuk Mine continued to advance during the second quarter, with the start of operations expected in August and first gold following a few weeks thereafter. The Company targets to maximize production for the partial year of production in 2026 and had previously guided a production level between 100,000 and 150,000 gold ounces for the year, it will provide an update on the production expectations for the second half of the year once operations commence in the third quarter. Following the commissioning and ramp-up of the Kurmuk Mine in the second half of 2026, the Company expects to produce between 240,000 and 270,000 gold ounces in 2027, which at the higher end, exceeds the guidance provided in February 2026, and approximately 300,000 gold ounces in 2028, all at industry-leading costs. This is expected to reposition and transform Allied's already strong cash flow generation, leading to increased shareholder returns.

Advancement of Key Growth Initiatives

Kurmuk Mine Progressing Towards Production: The development of the Kurmuk Mine continued to advance during the second quarter, with the start of operations expected in August and first gold following a few weeks thereafter. Key execution milestones continue to be met, and the project remains on budget and on schedule while advancing commissioning activities. While the Company targets to maximize production for the partial year of production in 2026 and had previously guided to a production level between 100,000 and 150,000 gold ounces for the year, it will provide an update on production expectations for the second half of the year once operations commence in the third quarter. As noted above, following the commissioning and ramp-up of the Kurmuk Mine, the Company expects to produce between 240,000 and 270,000 gold ounces in 2027, which at the higher end, exceeds the guidance provided in February 2026, and approximately 300,000 gold ounces in 2028, all at industry-leading costs.

Sadiola Next Growth Phase:The Company advanced processing improvements including instrumentation and automation upgrades aimed at improving recovery and reducing costs, together with the planned addition of a pre-leach thickener during 2026. The thickener is expected to enable the plant to process more than 90% of fresh ore, improve operating flexibility, and reduce reagent consumption in the first half of 2027.

Mine Life Increased at CDI Complex: Mineral Reserves and Mineral Resources updates for Agbaou demonstrate an increase of more than 60% over the year-end 2025 estimates, based on Proven and Probable Mineral Reserves. As a result, mine life for Agbaou based on Proven and Probable Mineral Reserves only has been extended to 2030, which, together with the previously disclosed update on the extension of the Bonikro mine life and the ongoing exploration efforts in the CDI Complex, supports the Company’s strategic objective of at least 200,000 gold ounces per year for over 10 years, thereby also increasing the minimum level of cumulative production from 180,000 gold ounces per year to 200,000 gold ounces per year.

Transaction with Zijin Gold

On July 29, 2026, the Company announced the termination of its arrangement agreement with Zijin Gold International Company Ltd. ("Zijin Gold"), as the parties determined that the conditions required to complete the transaction were unlikely to be satisfied by the agreed outside date.

Concurrently, the Company entered into a subscription agreement with Zijin Gold pursuant to which Zijin Gold agreed to invest approximately $295 million (C$417 million) through a non-brokered private placement of approximately 12.8 million common shares at a subscription price of C$32.55 per share. Upon closing, Zijin Gold is expected to own approximately 9.2% of the Company's issued and outstanding common shares and will hold rights to maintain its pro rata ownership interest until such time as it holds below 5%.

The private placement is subject to customary closing conditions, and is expected to close on or before August 10. The Company has received conditional approval of the Toronto Stock Exchange and approval from the New York Stock Exchange. The proceeds are intended to support the advancement of the Company's growth initiatives, including the completion and ramp-up of the Kurmuk project, the phased expansion of Sadiola, production growth initiatives at the CDI Complex, and ongoing exploration programs.

Sustainability, Health and Safety Highlights

The Company did not report any significant Environmental Incidents for the three months ended June 30, 2026. The Company’s Total Recordable Injury Rate (“TRIR”) for the three months ended June 30, 2026 was 1.46, compared to 1.21 for the 12 months ended December 31, 2025. The Company reported two Lost Time Injuries, resulting in Lost Time Injury Rate ("LTIR") of 0.29 for the three months ended June 30, 2026, compared to a LTIR of 0.29 for the 12 months ended December 31, 2025.

| OPERATING RESULTS SUMMARY | For three months ended June 30, | For six months ended June 30, | | | | | | | | | | 2026 | | 2025 | | 2026 | | 2025 | | Gold ounces | | | | | | | | | | Production | | 97,429 | | 91,017 | | 193,445 | | 175,057 | | Sales(3) | | 93,970 | | 81,103 | | 193,848 | | 212,623 | | Per Gold Ounce Sold | | | | | | | | | | Total Cost of Sales(4) | $ | 2,104 | $ | 2,294 | $ | 2,171 | $ | 2,019 | | Cash Costs(1) | $ | 1,923 | $ | 2,034 | $ | 1,988 | $ | 1,800 | | AISC(1) | $ | 2,192 | $ | 2,343 | $ | 2,229 | $ | 2,014 | | | | | | | | | | | | Average revenue per ounce for at-market sales* | $ | 4,568 | $ | 3,000 | $ | 3,913 | $ | 2,921 | | Average market price per ounce | $ | 4,506 | $ | 3,280 | $ | 4,693 | $ | 3,067 |

*Average revenue per ounce sold differs from average revenue per ounce for at-market sales predominantly due to hedge settlements and sales made under streams. For the second quarter of 2026 and on a year-to-date basis, the impact of hedge settlements was $(411)/ounce and $(532)/ounce, respectively (second quarter of 2025 and second quarter year-to-date 2025 - $(73)/ounce and $(38)/ounce, respectively) and the impact of stream, in-kind dividends and IFRS 15 adjustments was $(81)/per ounce and $(123)/ounce, respectively (second quarter of 2025 and second quarter year-to-date 2025 - $(75)/ounce and $(41)/ounce, respectively).

Gold production of 97,429 ounces during the three months ended June 30, 2026, compared to 91,017 ounces during the comparative prior period. The increase was predominantly driven by production growth at Bonikro and Agbaou during 2026, resulting from the benefits of stripping work executed in prior quarters, as anticipated.

Total cost of sales(4)of $2,104 for the three months ended June 30, 2026 compared to $2,294 during the comparative prior period. Cash costs(1) on a per gold ounce sold basis of $1,923 for the three months ended June 30, 2026, compared to $2,034 during the comparative prior period. AISC(1)for the current quarter of $2,192 compared to the comparative period AISC(1)of $2,343 per gold ounce. For the quarter, unit costs per ounce sold on a consolidated basis for the second quarter were in line with plan. The estimated gold price impact on second quarter AISC(1)as a result of higher royalties due to average gold prices of approximately $4,380, versus gold price assumed in guidance of $4,250, amounts to approximately $20 per ounce.

Sadiola (80% interest), Mali

Sadiola comprises the Sadiola (80% interest) open pit gold mine, located in the Kayes region of Mali, as well as the Korali-Sud open pit gold mine (65% interest), 15 kilometres south of the processing plant at Sadiola. The remaining ownership in Sadiola is retained by the Government of Mali.

| Sadiola Key Performance Information (100% Basis) | For three months ended June 30, | | | | | | | | 2026 | | | 2025 | | | | Operating | | | | | | | | Ore mined (M tonnes) | | 1.74 | | | 1.55 | | | Waste mined (M tonnes) | | 8.09 | | | 6.10 | | | Ore processed (M tonnes) | | 1.31 | | | 1.29 | | | Gold | | | | | | | | Production (Ounces) | | 48,080 | | | 49,283 | | | Sales(3)(Ounces) | | 45,619 | | | 43,648 | | | Feed grade (g/t) | | 1.37 | | | 1.31 | | | Recovery rate (%) | | 80.6 | % | | 89.1 | % | | Total cost of sales per ounce sold(4) | $ | 2,689 | | $ | 2,493 | | | Cash costs per ounce sold(1) | $ | 2,573 | | $ | 2,351 | | | AISC per ounce sold(1) | $ | 2,766 | | $ | 2,471 | | | Financial_(In thousands of US Dollars)_ | | | | | | | | Revenue | $ | 183,024 | | $ | 138,985 | | | Cost of sales (excluding DDA) | | (117,671 | ) | | (103,175 | ) | | Gross profit excluding DDA(1) | $ | 65,353 | | $ | 35,810 | | | DDA | | (4,981 | ) | | (5,635 | ) | | Gross Profit | $ | 60,372 | | $ | 30,175 | | | Capital Expenditures_(In thousands of US Dollars)_ | | | | | | | | Sustaining(1) | $ | 3,841 | | $ | 978 | | | Expansionary(1) | | 11,065 | | | 20,194 | | | Exploration(1) | | — | | | 40 | |

For the three months ended June 30, 2026, Sadiola produced 48,080 ounces of gold, compared to the 49,283 ounces produced in the comparative prior year quarter and aligned with the production plan. Production is expected to increase sequentially in the next quarter as a result of increased grades and throughput. Sadiola is in a strong position to meet its production guidance for the year, with further increases expected in the coming quarters, as previously disclosed.

Total cost of sales(4) and AISC(1)for the quarter were $2,689 and $2,766, respectively, per ounce sold on a consolidated basis for the second quarter were in line with plan. The estimated gold price impact on second quarter AISC(1)as a result of higher royalties due to average gold prices of approximately $4,380, versus gold price assumed in guidance of $4,250, amounts to approximately $20 per ounce. With quarterly production tracking in line with guidance and near-term increases in throughput and feed grade planned for the next quarters, costs for the balance of the year are expected to decline, consistent with the anticipated transition from mining and feeding predominantly oxide ores to a blend dominated by higher-grade fresh mineralization. As part of the quarterly production plan, various blending strategies were progressively deployed to support the implementation of new operational practices, automation improvements, and enhanced process controls aimed at consolidating CIL circuit performance with increased fresh ore feed. As noted above, with the progressive implementation of these initiatives and other operational improvements paired with increased feed grades and throughput, a corresponding reduction of unit costs is expected over subsequent quarters.

Gold sales for the current quarter differed slightly from production due to the timing of shipments.

Sadiola Expansion Project

Processing improvements in the quarter include instrumentation and automation upgrades aimed at improving recovery and reducing costs, together with the planned addition of a pre-leach thickener during 2026. The thickener is expected to enable the plant to process more than 90% of fresh ore, improve operating flexibility, and reduce reagent consumption in the first half of 2027. This work is intended to support a sustainable long-term operating platform for Sadiola at 200,000 to 230,000 gold ounces per year before further expansion.

Allied concluded in the fourth quarter of 2025 that the best execution strategy for expansion at Sadiola is to progressively optimize, develop, and expand the current processing plant and ancillary infrastructure, rather than to build a new processing plant to treat fresh ore. This organic growth strategy allows for more efficient deployment of capital and management of execution risks, and it enables the same ultimate throughput of over 9 Mt/y of ore processed as defined in the previous studies, but with interim, organic steps at 7 Mt/y and 8 Mt/y. This strategy also enables the recovery improvement project and the energy program to be implemented progressively as throughput capacity expands, thereby improving capital efficiency and returns. During the quarter, the Company advanced processing improvements including instrumentation and automation upgrades aimed at improving recovery and reducing costs, together with the planned addition of a pre-leach thickener during 2026. The thickener is expected to enable the plant to process more than 90% of fresh ore, improve operating flexibility, and reduce reagent consumption in the first half of 2027.

The Company continues to advance engineering for the 7 Mt/y expansion in anticipation of the start of construction in late 2026, as well as the engineering and design for the subsequent expansion steps. In parallel, Allied continues to advance studies to increase recoveries for fresh ore, including test work and engineering for the flotation and Albion and other processes, as well as undertaking design and execution engineering for the new tailings dam construction and solar farm earthworks.

Along with the advancement of the growth strategy for Sadiola, the Company is advancing its energy program for the asset and is undertaking a staged and scalable approach, having initially installed additional diesel generators and control systems to support the start of operations of the first phase expansion, followed by the implementation of a hybrid power solution, with the deployment of medium-speed thermal units and a photovoltaic plant with battery energy storage systems (“BESS”) sufficient to meet the power requirements of the Phase 1 expansion at reduced costs and providing the base for a scalable system capable of satisfying the energy needs of the next phase expansion, thereby providing Sadiola with a flexible power solution capable of meeting its ultimate power needs and reducing its emissions, while being self-reliant, efficient and cost-effective.

Sadiola Exploration

During the second quarter of 2026, exploratory and resource drilling programs were conducted on the Sadiola licence with a total of 74 holes drilled comprising 10,498 metres utilizing up to five exploration core and RC drill rigs. Resource and exploratory drilling programs continued and were expanded at Tambali North and along the Sadiola Main Deposit during the second quarter.

At Tambali North, a program was designed to follow-up on historic oxide gold mineralization and test a model that suggests that the Tambali Deposit mineralization continued to the north into the Sadiola Main pit and that historic waste piles, lying above the north-northeast extension of the Tambali North mineralization, are locally gold-bearing. This program initially comprised six short drill lines spaced 200 metres apart. Results to date have been positive and the Company has advanced infill drilling at a 100 metre line spacing at Tambali North. As of the end of the second quarter of 2026, 68 holes, comprising 6,491 metres, had been completed with drilling continuing past the end of the quarter.

Drilling continued at Sadiola Main during the quarter with 6 drill holes, totalling 4,007 metres. These holes are designed to test the southern strike extensions of the deposit, to test below previous drilling to begin to support an expansion of the reserve pit at depth, to evaluate Sadiola's underground potential and to test for depth extensions to the north-northeast trending structures that cut across the Sadiola Main shear zone. Additional holes are being planned with a goal to demonstrate depth extensions to the northern end of the Sadiola Main Zone and the northeast-trending cross-structures while gathering additional geological data to better define bedding-parallel mineralization across the entire deposit area.