Dundee Precious Metals Reports First Quarter 2025 Results

2025-05-06

TSX - Toronto Stock Exchange · Gold · Copper · Silver · Arsenic · Sulfur · Zinc · Lead · Antimony · Canada

TORONTO, May 06, 2025 (GLOBE NEWSWIRE) -- Dundee Precious Metals Inc. (TSX: DPM) (“DPM” or the “Company”) announced its operating and financial results for the first quarter ended March 31, 2025.

Highlights

(Unless otherwise stated, all monetary figures in this news release are expressed in U.S. dollars, and all operational and financial information contained in this news release is related to continuing operations.)

On-track to meet 2025 guidance: Produced 49,863 ounces of gold and 5.9 million pounds of copper in the first quarter. The Company is on-track to meet its 2025 production guidance. Record capital returns: Returned a record $90.4 million, or 114% of free cash flow, to shareholders during the first quarter of 2025 through the repurchase of approximately 7.5 million shares and the $0.04 per share quarterly dividend. Generating robust margins: Reported cost of sales per ounce of gold sold of $1,330 1,2 and an all-in sustaining cost per ounce of gold sold 1,2 of $1,244, which reflects a $214 per ounce impact related to mark-to-market adjustments to share-based compensation as a result of DPM's strong share price performance. DPM reconfirmed its 2025 guidance for all-in sustaining cost of $780 to $900 per ounce of gold sold. Strong adjusted net earnings per share: Reported adjusted net earnings 2 of $55.4 million ($0.32 per share 2 ) and net earnings from continuing operations of $33.5 million ($0.19 per share). Robust free cash flow generation: Generated $79.1 million of free cash flow 2 and $55.0 million of cash provided from operating activities of continuing operations. Advancing growth pipeline: Čoka Rakita feasibility study (“FS”) advancing well and on-track for completion at year-end 2025. Loma Larga FS update expected to be completed in the second quarter of 2025. Adding value through exploration: Advancing the 55,000-metre scout drilling campaign, focused on testing high priority targets within the Čoka Rakita camp, including at the high-grade copper-gold Dumitru Potok discovery, as well as the Rakita North and Valja Saka prospects, all located within proximity to planned Čoka Rakita project infrastructure. Substantial liquidity for growth: Ended the quarter with a strong balance sheet, including a total of $763.0 million of cash, a $150.0 million undrawn revolving credit facility, and no debt. Board succession: Juanita Montalvo was appointed Chair of the Board of Directors effective May 3, 2025, in accordance with the Board’s succession planning process. Ms. Montalvo has served on DPM’s Board since 2017, and brings more than 25 years of mining sector experience, as well as strong leadership and governance expertise to guide the Company's growth strategy.

| 1 | Cost of sales per ounce of gold sold represents total cost of sales for Chelopech and Ada Tepe, divided by total payable gold in concentrate sold, while all-in sustaining cost per ounce of gold sold includes treatment and freight charges, net of by-product credits, all of which are reflected in revenue. | | 2 | All-in sustaining cost per ounce of gold sold, free cash flow, adjusted net earnings and adjusted basic earnings per share are non-GAAP financial measures or ratios. These measures have no standardized meanings under IFRS Accounting Standards (“IFRS”) and may not be comparable to similar measures presented by other companies. Refer to the “Non-GAAP Financial Measures” section commencing on page 12 of this news release for more information, including reconciliations to IFRS measures. | | | |

CEO Commentary

David Rae, President and Chief Executive Officer, made the following comments in relation to the first quarter results:

“We continue to consistently deliver free cash flow, generating approximately $79 million during the quarter, and further strengthen our financial capacity to fund growth. At the same time, our investors are benefiting from our low-cost, high-margin gold production as we harvest free cash flow by returning excess capital to shareholders, demonstrated by the repurchase of a record 7.5 million shares during the quarter.

“Our 55,000-metre drilling program focused on testing high priority targets proximal to our Čoka Rakita project is advancing well, with 14 drill rigs currently in operation. The drilling program continues to expand the copper-gold Dumitru Potok discovery, and we have yet to define its limits as it remains open in multiple directions and at depth. We are also advancing drilling at the Rakita North and Valja Saka prospects.

“We are deeply saddened by the passing of Peter Gillin, Chair of the Board since 2022 and a director for the past 16 years. His steady leadership and oversight helped guide our transformation into the responsible, growing precious metals company we are today, and he will be missed by all.

“We are pleased to have Juanita Montalvo assume the role of Chair at an exciting time for DPM's growth outlook. This continuity in leadership underpins our operating track record, exploration success and strong financial position, as we focus on creating a robust platform for growth to deliver above-average returns for our shareholders.”

Use of non-GAAP Financial Measures

Certain financial measures referred to in this news release are not measures recognized under IFRS and are referred to as non-GAAP financial measures or ratios. These measures have no standardized meanings under IFRS and may not be comparable to similar measures presented by other companies. The definitions established and calculations performed by DPM are based on management’s reasonable judgment and are consistently applied. These measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures prepared in accordance with IFRS. Non-GAAP financial measures and ratios, together with other financial measures calculated in accordance with IFRS, are considered to be important factors that assist investors in assessing the Company’s performance.

The Company uses the following non-GAAP financial measures and ratios in this news release:

mine cash cost cash cost per tonne of ore processed mine cash cost of sales cash cost per ounce of gold sold all-in sustaining cost all-in sustaining cost per ounce of gold sold adjusted earnings (loss) before interest, taxes, depreciation and amortization (“adjusted EBITDA”) adjusted net earnings (loss) adjusted basic earnings (loss) per share cash provided from operating activities, before changes in working capital free cash flow average realized metal prices

For a detailed description of each of the non-GAAP financial measures and ratios used in this news release and a detailed reconciliation to the most directly comparable measure under IFRS, please refer to the “Non-GAAP Financial Measures” section commencing on page 11 of this news release.

Key Operating and Financial Highlights from Continuing Operations

| $ millions, except where noted | | Three Months | | | | | | 2025 | 2024 | Change | | | | Operating Highlights | | | | | | | Ore Processed | t | 680,142 | 701,198 | (3 | %) | | Metals contained in concentrate produced: | | | | | | | Gold | | | | | | | Chelopech | oz | 37,413 | 37,495 | 0 | % | | Ada Tepe | oz | 12,450 | 25,232 | (51 | %) | | Total gold in concentrate produced | oz | 49,863 | 62,727 | (21 | %) | | Copper | Klbs | 5,905 | 6,692 | (12 | %) | | Payable metals in concentrate sold: | | | | | | | Gold | | | | | | | Chelopech | oz | 32,422 | 29,568 | 10 | % | | Ada Tepe | oz | 12,367 | 25,644 | (52 | %) | | Total payable gold in concentrate sold | oz | 44,789 | 55,212 | (19 | %) | | Copper | Klbs | 5,163 | 5,457 | (5 | %) | | Cost of sales per tonne of ore processed (1) : | | | | | | | Chelopech | $/t | 68 | 69 | (1 | %) | | Ada Tepe | $/t | 160 | 147 | 9 | % | | Cash cost per tonne of ore processed (2) : | | | | | | | Chelopech | $/t | 53 | 55 | (4 | %) | | Ada Tepe | $/t | 85 | 65 | 31 | % | | Cost of sales per ounce of gold sold (3) | $/oz | 1,330 | 1,127 | 18 | % | | All-in sustaining cost per ounce of gold sold (2) | $/oz | 1,244 | 883 | 41 | % | | Capital expenditures incurred (4) : | | | | | | | Sustaining (5) | | 7.6 | 5.7 | 33 | % | | Growth and other (6) | | 11.7 | 8.3 | 42 | % | | Total capital expenditures | | 19.3 | 14.0 | 38 | % | | Financial Highlights | | | | | | | Average realized prices (2) : | | | | | | | Gold | $/oz | 3,004 | 2,127 | 41 | % | | Copper | $/lb | 4.35 | 3.89 | 12 | % | | Revenue | | 144.1 | 123.8 | 16 | % | | Cost of sales | | 59.5 | 62.2 | (4 | %) | | Earnings before income taxes | | 38.6 | 46.3 | (17 | %) | | Adjusted EBITDA (2) | | 75.2 | 54.5 | 38 | % | | Net earnings | | 33.5 | 39.4 | (15 | %) | | Basic earnings per share | $/sh | 0.19 | 0.22 | (14 | %) | | Adjusted net earnings (2) | | 55.4 | 32.5 | 70 | % | | Adjusted basic earnings per share (2) | $/sh | 0.32 | 0.18 | 78 | % | | Cash provided from operating activities (7) | | 55.0 | 35.8 | 53 | % | | Free cash flow (2) | | 79.1 | 60.1 | 32 | % |

| (1) | Cost of sales per tonne of ore processed represents cost of sales for Chelopech and Ada Tepe, respectively, divided by tonnes of ore processed. | | (2) | Cash cost per tonne of ore processed, all-in sustaining cost per ounce of gold sold, average realized metal prices, adjusted EBITDA, adjusted net earnings, adjusted basic earnings per share, and free cash flow are non-GAAP financial measures or ratios. Refer to the “Non-GAAP Financial Measures” section commencing on page 11 of this news release for more information, including reconciliations to IFRS measures. | | (3) | Cost of sales per ounce of gold sold represents total cost of sales for Chelopech and Ada Tepe, divided by total payable gold in concentrate sold. | | (4) | Capital expenditures incurred are reported on an accrual basis and do not represent the cash outlays for the capital expenditures. | | (5) | Sustaining capital expenditures are generally defined as expenditures that support the ongoing operation of the asset or business without any associated increase in capacity, life of assets or future earnings. This measure is used by management and investors to assess the extent of non-discretionary capital spending being incurred by the Company each period. | | (6) | Growth capital expenditures are generally defined as capital expenditures that expand existing capacity, increase life of assets and/or increase future earnings. This measure is used by management and investors to assess the extent of discretionary capital spending being undertaken by the Company each period. | | (7) | Excludes cash provided from operating activities of discontinued operations of $173.2 million (2024 _– _$17.7 million) during the first quarter of 2025. | | | |

Performance Highlights

A table comparing production, sales and cash cost measures by asset for the first quarter ended March 31, 2025 against 2025 guidance is located on page 8 of this news release.

In the first quarter of 2025, the Company’s mining operations delivered solid gold production. With higher production planned for the second half of the year, DPM is on track to achieve its 2025 guidance.

Highlights include the following:

Chelopech, Bulgaria: Gold contained in concentrates produced in the first quarter of 2025 was comparable to 2024 due primarily to lower gold grades largely offset by higher gold recoveries. Copper production in 2025 was lower than 2024 due primarily to lower copper grades, in line with the mine plan.

All-in sustaining cost per ounce of gold sold in the first quarter of 2025 was lower than 2024 due primarily to higher volumes of gold sold as a result of DPM having secured more favourable commercial terms, higher by-product credits reflecting higher realized copper prices and lower freight charges.

Ada Tepe, Bulgaria: Gold contained in concentrate produced in the first quarter of 2025 was lower than 2024, due primarily to mining lower grade zones and lower volumes of ore processed, in line with the mine plan. Gold production at Ada Tepe is forecast to nearly double in the second half of 2025, relative to the first half of the year, due to the cell sequencing of its integrated mine waste facility.

All-in sustaining cost per ounce of gold sold in the first quarter 2025 was higher than 2024 due primarily to lower volumes of gold sold, partially offset by lower royalties, as well as higher sustaining capital expenditures as a result of higher deferred stripping costs.

Consolidated Operating Highlights

Production: Gold contained in concentrate produced in the first quarter of 2025 was 21% lower than 2024 due primarily to lower gold grades and lower volumes of ore processed at Ada Tepe, partially offset by higher gold recoveries at Chelopech, in line with the mine plan for each operation.

Copper production in the first quarter of 2025 was 12% lower than 2024 due primarily to lower copper grades.

Deliveries: Payable gold in concentrate sold in the first quarter of 2025 was 19% lower than 2024 primarily reflecting lower gold production.

Payable copper in concentrate sold in the first quarter of 2025 was 5% lower than 2024 due primarily to lower copper production.

Cost measures: Cost of sales in the first quarter of 2025 was 4% lower than 2024 due primarily to lower depreciation and lower royalties reflecting lower contained ounces mined at Ada Tepe, partially offset by higher labour costs including higher mark-to-market adjustments to share-based compensation expenses as a result of DPM’s strong share price performance.

All-in sustaining cost per ounce of gold sold in the first quarter of 2025 was 41% higher than 2024, due primarily to lower volumes of gold sold and higher mark-to-market adjustments to share-based compensation expenses reflecting DPM’s strong share price performance. Mark-to-market adjustments to share-based compensation expenses resulted in an increase of $214 per ounce of gold sold in the first quarter of 2025 compared to an increase of $38 per ounce of gold sold in 2024.

Capital expenditures: Sustaining capital expenditures incurred in the first quarter of 2025 were 33% higher than 2024, due primarily to higher deferred stripping costs at Ada Tepe.

Growth and other capital expenditures incurred in the first quarter of 2025 were 42% higher than 2024, due primarily to costs related to the Čoka Rakita project being capitalized from 2025 as a result of the project’s advancement to the FS stage.

Consolidated Financial Highlights

Financial results in the first quarter of 2025 reflected higher realized metal prices, partially offset by lower volumes of gold sold at Ada Tepe.

Revenue: Revenue in the first quarter of 2025 was 16% higher than 2024 due primarily to higher realized metal prices, partially offset by lower volumes of gold sold.

Net earnings: Net earnings from continuing operations in the first quarter of 2025 was 15% lower than 2024 due primarily to a one-time levy to the 2025 Bulgarian state budget for an aggregated amount of $24.4 million, in respect of Chelopech and Ada Tepe, as well as higher employee costs reflecting higher mark-to-market adjustments to share-based compensation expenses, partially offset by higher revenue and lower evaluation expenses as a result of the capitalization of costs related to the Čoka Rakita project.

Adjusted net earnings: Adjusted net earnings from continuing operations in the first quarter of 2025 was 70% higher than 2024, due primarily to the same factors affecting net earnings from continuing operations, with the exception of adjusting items primarily related to the one-time Bulgarian levy in 2025, and a net termination fee received from Osino Resources Corp. (“Osino”) in 2024.

Cash provided from operating activities: Cash provided from operating activities of continuing operations in the first quarter of 2025 was 53% higher than 2024, due primarily to higher adjusted net earnings from continuing operations.

Free cash flow: Free cash flow from continuing operations in the first quarter of 2025 was 32% higher than 2024, due primarily to the same factors impacting adjusted net earnings from continuing operations. Free cash flow is calculated before changes in working capital.

Board of Directors Succession

In accordance with the Board’s succession planning process, the Company announced the appointment of Juanita Montalvo as Chair of the Board effective May 3, 2025. Ms. Montalvo has served on DPM’s Board since 2017, including as Chair of the Corporate Governance and Nominating Committee and previously Chair of the Sustainability Committee. With more than 25 years of international experience in the mining and extractive sectors, she has a strong track record in the development of large-scale industrial projects, operational and strategic decision making, and brings extensive governance expertise.

Ms. Montalvo succeeds R. Peter Gillin, who sadly passed away in May 2025, after serving as Chair since 2022 and as a director for the past 16 years.

Balance Sheet Strength and Financial Flexibility

The Company continues to maintain a strong financial position, with a growing cash position, no debt and an undrawn $150 million revolving credit facility.

Cash and cash equivalents increased by $128.2 million to $763.0 million in the first quarter of 2025, due primarily to a net cash inflow of $173.2 million related to the DPM Tolling Agreement, earnings generated in the period, and cash interest received, partially offset by payments for shares repurchased under the Normal Course Issuer Bid (“NCIB”), cash outlays for capital expenditures and dividends paid.

Return of Capital to Shareholders

In line with its disciplined capital allocation framework, DPM continues to return excess capital to shareholders, which currently includes a sustainable quarterly dividend and periodic share repurchases under the NCIB.

During the first quarter of 2025, the Company returned a total of $90.4 million to shareholders through the repurchase of approximately 7.5 million shares, for a total cash payment of $83.3 million, and $7.1 million of dividends paid.

The Company renewed its NCIB effective March 18, 2025, pursuant to which the Company is able to purchase up to 15 million common shares representing approximately 9.8% of the public float as at March 4, 2025, over a period of twelve months commencing March 18, 2025 and terminating on March 17, 2026.

The actual timing and number of common shares that may be purchased under the NCIB will be undertaken in accordance with DPM’s capital allocation framework, having regard for such things as DPM’s financial position, business outlook and ongoing capital requirements, as well as its share price relative to market peers and intrinsic value and overall market conditions.

On May 6, 2025, the Company declared a dividend of $0.04 per common share payable on July 15, 2025 to shareholders of record on June 30, 2025.

Development Projects Update

Čoka Rakita, Serbia

The Company continues to advance the Čoka Rakita project, targeting first concentrate production in 2028. The FS is advancing as planned and is expected to be completed by year-end 2025. Activities in 2025 will include completing surface and underground geotechnical and hydrogeological drilling, advancing permitting, progressing the design to the basic engineering level, advancing the project execution readiness, and commencing operational readiness activities, leveraging the project’s regional proximity to DPM’s Chelopech underground mine to train and develop key personnel for operating roles.

Permitting activities have continued to advance, with a detailed permitting timeline focused on supporting commencement of construction in mid-2026.

Work continues on various baseline studies required for the Environmental and Social Impact Assessment. The final report on Mineral Resources and Mineral Reserves (the Elaborate of Reserves), as required under the Serbian permitting process, was submitted to the relevant authorities during the first quarter. DPM continues to focus on completing all preparatory work for the Special Purpose Spatial Plan, pending a decision by the Serbian government to initiate the process, and is proactively engaging with relevant stakeholders to mitigate the risk of administrative delays.