Torex Gold Resources Inc. press release
Torex Gold Reports Q1 2025 Results
TSX - Toronto Stock Exchange · Gold · Silver · Copper · Canada
Results in line with expectations and tracking well to full-year guidance
(All amounts expressed in U.S. dollars unless otherwise stated)
Toronto, Ontario--(Newsfile Corp. - May 7, 2025) - Torex Gold Resources Inc. (the "Company" or "Torex") (TSX: TXG) reports the Company's financial and operational results for the three months ended March 31, 2025. Torex will host a conference call tomorrow morning at 9:00 AM (ET) to discuss the results.
Jody Kuzenko, President & CEO of Torex, stated:
"The first quarter was marked with significant milestones for Torex. We completed the tie-ins at the processing plant not only on time but, more importantly, safely. We also delivered first concentrate production, with regular shipments commencing in April. Earlier this week, we proudly declared commercial production at Media Luna, marking the conclusion of the project phase and the beginning of our transition back to positive free cash flow1generation.
"Production levels for the quarter were in line with our expectations given the four-week shutdown at the processing plant. Production is expected to pick up during the second quarter through the early stages of ramp up and increase further through the back half of the year, with annual guidance being maintained. All-in sustaining costs1for Q1 were much better than originally anticipated as initial sales from Media Luna did not commence until early April. As a result, the higher cost ore associated with the commissioning phase of the Media Luna mine will now be recognized in Q2, aligning with initial sales from Media Luna.
"As is typical of our cash flow seasonality, the first quarter was the highest for tax and royalty payments for the year. These payments, coupled with the final capital spend on Media Luna and limited production, necessitated the net $130 million draw on our credit facility per our plan. As we hit our projected free cash flow inflection point mid-year with completion of Media Luna Project spending, we expect to repay the modest amount of debt drawn quickly, particularly as production ramps up under a backdrop of record gold prices.
"With our highest cash outflow and lowest production quarter of the year now behind us, our focus is set on further unlocking value for our shareholders through returning to positive free cash flow, executing our exploration program across the entire Morelos Property, implementing a formal return of capital policy, delivering on full-year guidance for the seventh consecutive year, and ramping up Media Luna to the designed mining rate by mid-2026."
FIRST QUARTER 2025 HIGHLIGHTS
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Safety performance:The Company recorded one lost-time injury during the quarter when a contractor suffered an ankle fracture. As at March 31, 2025, the lost-time injury frequency ("LTIF") for the Morelos Complex was 0.59 per million hours worked for both employees and contractors on a rolling 12-month basis. During the quarter, the internal investigation into the fatal carbon monoxide exposure that occurred in December 2024 was concluded and follow up action items are being tracked to completion. In addition, the Company has embarked on a comprehensive 'Next Level Safety' program with a view to ensuring that the operations resumes and maintains its prior fatality free status.
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Gold payable production:On a gold equivalent ounce ("oz AuEq") basis, payable production for the quarter was 59,630 oz AuEq2, including 58,330 oz Au. Production in the quarter was as expected and driven by the planned four-week tie-in period at the processing plant in connection with the Media Luna Project. The Company is on track to achieve annual payable production guidance of 400,000 to 450,000 oz AuEq2.
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Gold sold: The Company sold 60,568 oz AuEq2at a record quarterly average realized gold price1of $2,793 per oz, contributing to revenue of $170.0 million, which was lower than the quarterly average as sales of metal produced from the new circuits as part of the Media Luna Project commenced in April.
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All-in sustaining costs1:All-in sustaining costs of $1,405 per oz AuEq sold2relative to guidance of $1,400 to $1,600 per oz AuEq sold2. All-in sustaining costs margin1of $1,388 per oz AuEq sold, implying an all-in sustaining costs margin1of 50%. Cost of sales was $94.1 million or $1,554 per oz AuEq sold in the quarter.
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Net income and adjusted net earnings1:Reported net income of $39.0 million or earnings of $0.45 per share on both a basic and dilutive basis. Adjusted net earnings of $35.9 million or $0.42 per share on a basic basis and $0.41 per share on a diluted basis.
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EBITDA1and adjusted EBITDA1:Generated EBITDA of $88.1 million and adjusted EBITDA of $91.8 million.
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Cash flow generation:Net cash used in operating activities totalled $9.9 million and $17.7 million before changes in non-cash operating working capital. Net cash used in operating activities (including changes in non-cash operating working capital) of $9.9 million including income taxes paid of $101.6 million, reflecting the annual payment of mining taxes and annual true-up of corporate income taxes, and payment of the 0.5% royalty in respect of 2024 of $4.7 million. Negative free cash flow1of $133.3 million is net of cash outlays for capital expenditures, lease payments, and interest, including borrowing costs capitalized. Negative free cash flow was a result of the lower sales volumes due to the four-week tie-in period at the processing plant and capital expenditures of $123.5 million in the first quarter of 2025.
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Financial liquidity:The quarter closed with $197.6 million in available liquidity1, including $106.5 million in cash and $91.1 million available on the $300.0 million credit facilities, net of borrowings of $195.0 million and letters of credit outstanding of $13.9 million.
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Media Luna Project:In late March, the tie-in period was completed at the processing plant and the Company achieved first production of copper concentrate, marking the substantial completion of the Media Luna Project. Effective April 26, 2025, Media Luna reached the production stage, and commercial production was declared. During the quarter, $55.5 million was invested in the project and as of March 31, 2025, physical progress on the Project was approximately 98%.
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Exploration and Drilling Activities: In February, the Company announced results from the ongoing drilling program at Media Luna West and results from initial drill testing at Media Luna East3. The advanced exploration drilling program at Media Luna West has defined a mineralized footprint of 600 metres ("m") by 400 m with multiple high-grade intercepts. The intercepts indicate the exploration upside to the west of the defined resource boundaries of Media Luna and EPO. Initial drill testing at Media Luna East returned strong results, with multiple high-grade intercepts, many with copper ("Cu") grades in excess of 2%. Drilling at both targets is part of the Company's exploration strategy, which is focused, in part, on unlocking the resource potential of the Morelos Complex in order to enhance and extend the production profile.
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Year-end Mineral Reserves & Resources4: At EPO, an inaugural Probable Reserve of 781 koz AuEq was declared in September 2024 and an updated reserve estimate for EPO is currently being undertaken as part of the internal feasibility study. Due to drilling undertaken in 2024 north of the EPO deposit, Inferred Resources at EPO increased 32% to 954 koz AuEq from 721 koz AuEq. At ELG Underground, drilling was successful at replacing depletion with Proven and Probable Reserves increasing 1% to 662 koz AuEq during the year, supporting a reserve life through early 2029, which assumes an average mining rate of 2,800 tpd through 2026 and approximately 2,000 tpd thereafter. At Media Luna, updated mineral reserves and mineral resources primarily reflect results of definition drilling as well as modest refinements to some stope shapes. With the completion of the Media Luna Project, step-out and infill drilling at Media Luna is set to resume in 2025, with the goal of expanding and upgrading mineral resources as well as replacing mineral reserves. The positive results from the 2024 drilling program solidifies annual payable production of at least 450,000 koz AuEq through 2030 and a reserve life out to at least 2035. With approximately 125,000 m of drilling planned in 2025, almost double the metres drilled in 2024, the Company is focused on enhancing the base case production profile beyond 2030, extending the reserve life of the underground deposits, and further showcasing the underlying potential of the broader Morelos Property by testing several regional targets.
1. These measures are non-GAAP financial measures ("Non-GAAP Measures") which are not standardized financial measures under IFRS, the framework used to prepare the financial statements of the Company and might not be comparable to similar financial measures used by other companies. For a detailed reconciliation of each Non-GAAP Measure to its most directly comparable measure in accordance with the IFRS, see Tables 2 to 11 of this press release. For additional information on these Non-GAAP Measures, please refer to the Company's MD&A for the three months ended March 31, 2025, dated May 7, 2025, which is incorporated by reference into this news release. The MD&A and the Company's unaudited condensed consolidated interim financial statements and related notes for the three months ended March 31, 2025, are available on Torex's website (www.torexgold.com) and under the Company's SEDAR+ profile (www.sedarplus.ca). 2. Gold equivalent ounces produced and sold include production of silver and copper converted to a gold equivalent based on a ratio of the average market prices for each commodity sold in the period. For the three months ended March 31, 2025, market prices averaged $2,860/oz gold, $31.88/oz silver, and $4.24/lb copper. Guidance for 2025 assumed metal prices of $2,500/oz gold, $28/oz silver, and $4.30/lb copper. 3. For more information on Media Luna drilling results, see the Company's news release titled "Torex Gold Reports Excellent Drill Results from Media Luna West and Initial Results from Media Luna East" issued on February 24, 2025, and filed on SEDAR+ at www.sedarplus.caand on the Company's website at www.torexgold.com. 4. Mineral reserve and mineral resource estimates for the Morelos Complex can be found in tables 12 and 13, respectively, of this press release. AuEq values account for underlying metal prices and metallurgical recoveries used in reserve and resource estimates. For additional information on the mineral reserve and mineral resource estimates for the Morelos Complex, please see the Company's annual information form for the year ended December 31, 2024, or the Company's news release titled "Torex Gold Reports Year-end 2024 Reserves & Resources" issued on March 19, 2025, and filed on SEDAR+ at www.sedarplus.caand on the Company's website at www.torexgold.com.
CONFERENCE CALL AND WEBCAST DETAILS
The Company will host a conference call tomorrow at 9:00 AM (ET) where senior management will discuss the first quarter operating and financial results. For expedited access to the conference call, registrationis open to obtain an access code in advance, which will allow participants to join the call directly at the scheduled time. Alternatively, dial-in details are as follows:
Toronto local or International: 1-647-846-8914 Toll-Free (North America): 1-833-752-3842
A live webcast and replay of the conference call will be available on the Company's website at https://torexgold.com/investors/upcoming-events/. The webcast will be archived on the Company's website.
Table 1: Operating and Financial Highlights
| | | | Three Months Ended | | | | | | | | | | | | Mar 31, | | | Dec 31, | | | Mar 31, | | | In millions of U.S. dollars, unless otherwise noted | | 2025 | | | 2024 | | | 2024 | | | | Safety | | | | | | | | | | | | Lost-time injury frequency1 | /million hours | | 0.59 | | | 0.61 | | | 0.15 | | | Total recordable injury frequency1 | /million hours | | 1.52 | | | 1.48 | | | 0.97 | | | Operating Results - Gold Equivalent basis | | | | | | | | | | | | Gold equivalent payable produced2 | oz AuEq | | 59,630 | | | 105,132 | | | 117,054 | | | Gold equivalent sold2 | oz AuEq | | 60,568 | | | 110,419 | | | 114,106 | | | Total cash costs2,3 | $/oz AuEq | | 1,020 | | | 932 | | | 944 | | | Total cash costs margin2,3 | $/oz AuEq | | 1,773 | | | 1,555 | | | 1,079 | | | All-in sustaining costs2,3 | $/oz AuEq | | 1,405 | | | 1,112 | | | 1,222 | | | All-in sustaining costs margin2,3 | $/oz AuEq | | 1,388 | | | 1,375 | | | 801 | | | Average realized gold price2,3 | $/oz | | 2,793 | | | 2,487 | | | 2,023 | | | Financial Results | | | | | | | | | | | | Revenue | $ | | 170.0 | | | 295.0 | | | 236.5 | | | Cost of sales | $ | | 94.1 | | | 153.5 | | | 157.4 | | | Earnings from mine operations | $ | | 75.9 | | | 141.5 | | | 79.1 | | | Net income | $ | | 39.0 | | | 60.4 | | | 43.1 | | | Per share - Basic | $/share | | 0.45 | | | 0.70 | | | 0.50 | | | Per share - Diluted | $/share | | 0.45 | | | 0.69 | | | 0.50 | | | Adjusted net earnings3 | $ | | 35.9 | | | 70.6 | | | 35.9 | | | Per share - Basic3 | $/share | | 0.42 | | | 0.82 | | | 0.42 | | | Per share - Diluted3 | $/share | | 0.41 | | | 0.81 | | | 0.42 | | | EBITDA3 | $ | | 88.1 | | | 162.8 | | | 98.0 | | | Adjusted EBITDA3 | $ | | 91.8 | | | 154.3 | | | 113.2 | | | Cost of sales - gold equivalent basis | $/oz AuEq | | 1,554 | | | 1,390 | | | 1,378 | | | Net cash (used in) generated from operating activities | $ | | (9.9 | ) | | 122.8 | | | 79.8 | | | Net cash (used in) generated from operating activities before changes in non-cash operating working capital | $ | | (17.7 | ) | | 136.3 | | | 72.5 | | | Free cash flow3 | $ | | (133.3 | ) | | (7.7 | ) | | (59.4 | ) | | Cash and cash equivalents | $ | | 106.5 | | | 110.2 | | | 113.2 | | | Debt, net of deferred finance charges | $ | | 193.1 | | | 62.9 | | | - | | | Lease-related obligations | $ | | 86.5 | | | 78.3 | | | 44.0 | | | Net (debt) cash3 | $ | | (175.0 | ) | | (33.1 | ) | | 69.2 | | | Available liquidity3 | $ | | 197.6 | | | 331.5 | | | 405.3 | |
1. On a 12-month rolling basis, per million hours worked. 2. Gold equivalent ounces produced and sold include production of silver and copper converted to a gold equivalent based on a ratio of the average market prices for each commodity sold in the period. Refer to the "Gold Equivalent Reporting" section of the Company's MD&A for the three months ended March 31, 2025, dated May 7, 2025 for the relevant average market prices by commodity, available on Torex's website (www.torexgold.com) and under the Company's SEDAR+ profile (www.sedarplus.ca). 3. Total cash costs, total cash costs margin, all-in sustaining costs, all-in sustaining costs margin, average realized gold price, adjusted net earnings, adjusted net earnings per share, EBITDA, adjusted EBITDA, free cash flow, net (debt) cash and available liquidity are non-GAAP financial measures with no standardized meaning under IFRS and might not be comparable to similar financial measures disclosed by other issuers. For a detailed reconciliation of each Non-GAAP Measure to its most directly comparable measure in accordance with the IFRS as issued by the International Accounting Standards Board see Tables 2 to 11 of this press release. For additional information on these Non-GAAP Measures, please refer to the Company's MD&A for the three months ended March 31, 2025, dated May 7, 2025. The MD&A and the Company's the Company's unaudited condensed consolidated interim financial statements and related notes for the three months ended March 31, 2025, are available on Torex's website (www.torexgold.com) and under the Company's SEDAR+ profile (www.sedarplus.ca)
Table 2: Reconciliation of Total Cash Costs and All-in Sustaining Costs to Production Costs and Royalties
| | | | Three Months Ended | | | | | | | | | | | | Mar 31, | | | Dec 31, | | | Mar 31, | | | In millions of U.S. dollars, unless otherwise noted | | | 2025 | | | 2024 | | | 2024 | | | Gold sold | oz | | 59,756 | | | 108,647 | | | 111,642 | | | | | | | | | | | | | | | Total cash costs per oz sold | | | | | | | | | | | | Production costs1 | $ | | 56.2 | | | 94.7 | | | 100.8 | | | Royalties | $ | | 6.0 | | | 8.2 | | | 6.9 | | | Less: Silver sales | $ | | (1.1 | ) | | (1.8 | ) | | (1.5 | ) | | Less: Copper sales | $ | | (1.2 | ) | | (3.1 | ) | | (3.7 | ) | | Less: Realized gain on foreign currency contracts | $ | | (0.4 | ) | | - | | | - | | | Total cash costs | $ | | 59.5 | | | 98.0 | | | 102.5 | | | Total cash costs per oz sold | $/oz | | 996 | | | 902 | | | 918 | | | | | | | | | | | | | | | All-in sustaining costs per oz sold | | | | | | | | | | | | Total cash costs | $ | | 59.5 | | | 98.0 | | | 102.5 | | | General and administrative costs2 | $ | | 8.7 | | | 7.3 | | | 8.0 | | | Reclamation and remediation costs | $ | | 1.0 | | | 1.0 | | | 1.3 | | | Sustaining capital expenditure | $ | | 13.6 | | | 11.6 | | | 22.4 | | | Total all-in sustaining costs | $ | | 82.8 | | | 117.9 | | | 134.2 | | | Total all-in sustaining costs per oz sold | $/oz | | 1,386 | | | 1,085 | | | 1,202 | | | | | | | | | | | | | | | Gold equivalent sold3 | oz AuEq | | 60,568 | | | 110,419 | | | 114,106 | | | | | | | | | | | | | | | Total cash costs per oz AuEq sold | | | | | | | | | | | | Production costs1 | $ | | 56.2 | | | 94.7 | | | 100.8 | | | Royalties | $ | | 6.0 | | | 8.2 | | | 6.9 | | | Less: Realized gain on foreign currency contracts | $ | | (0.4 | ) | | - | | | - | | | Total cash costs | $ | | 61.8 | | | 102.9 | | | 107.7 | | | Total cash costs per oz AuEq sold3 | $/oz AuEq | | 1,020 | | | 932 | | | 944 | | | | | | | | | | | | | | | All-in sustaining costs per oz AuEq sold | | | | | | | | | | | | Total cash costs | $ | | 61.8 | | | 102.9 | | | 107.7 | | | General and administrative costs2 | $ | | 8.7 | | | 7.3 | | | 8.0 | | | Reclamation and remediation costs | $ | | 1.0 | | | 1.0 | | | 1.3 | | | Sustaining capital expenditure | $ | | 13.6 | | | 11.6 | | | 22.4 | | | Total all-in sustaining costs | $ | | 85.1 | | | 122.8 | | | 139.4 | | | Total all-in sustaining costs per oz AuEq sold3 | $/oz AuEq | | 1,405 | | | 1,112 | | | 1,222 | |
1. This amount excludes temporary suspension costs of $nil, $3.1 million and $nil for the three months ended March 31, 2025, December 31, 2024, and March 31, 2024, respectively. 2. This amount excludes a loss of $7.6 million, loss of $6.8 million and loss of $4.2 million for the three months ended March 31, 2025, December 31, 2024, and March 31, 2024, respectively, in relation to the remeasurement of share-based payments. This amount also excludes corporate depreciation and amortization expenses totalling $0.1 million, $0.2 million and $0.1 million for the three months ended March 31, 2025, December 31, 2024, and March 31, 2024, respectively, within general and administrative costs. Included in general and administrative costs is share-based compensation expense in the amount of $2.3 million or $38/oz ($38/oz AuEq) for the three months ended March 31, 2025, $1.6 million or $15/oz ($14/oz AuEq) for the three months ended December 31, 2024, $2.3 million or $21/oz ($20/oz AuEq) for the three months ended March 31, 2024. This amount excludes other expenses totalling $nil, $1.4 million and $1.2 million for the three months ended March 31, 2025, December 31, 2024, and March 31, 2024, respectively. 3. Gold equivalent ounces produced and sold include production of silver and copper converted to a gold equivalent based on a ratio of the average market prices for each commodity sold in the period. Refer to the "Gold Equivalent Reporting" section of the Company's MD&A for the three months ended March 31, 2025, dated May 7, 2025 for the relevant average market prices by commodity, available on Torex's website (www.torexgold.com) and under the Company's SEDAR+ profile (www.sedarplus.ca).
Table 3: Reconciliation of Sustaining and Non-Sustaining Capital Expenditures to Additions to Property, Plant and Equipment