Torex Gold Resources Inc. press release

Torex Gold Reports Q2 2026 Results

2026-08-06

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

Strong free cash flow and 46% AISC margin support continued capital returns, with higher production expected in H2 as grades improve

(All amounts expressed in U.S. dollars unless otherwise stated)

Toronto, Ontario--(Newsfile Corp. - August 6, 2026) - Torex Gold Resources Inc. (the "Company" or "Torex") (TSX: TXG) (OTCQX: TORXF) reports the Company's financial and operational results for the three and six months ended June 30, 2026. Torex will host a conference call tomorrow morning at 9:00 AM (ET) to discuss the results.

Andrew Snowden, President & CEO of Torex, stated:

"Second quarter operational results were in line with expectations and delivered safely, with no lost-time injuries for the fifth consecutive quarter. Production of 96,297 gold equivalent ounces1("oz AuEq") tracked to plan as we continued to mine through lower-grade and lower gold recovery areas of Media Luna. We remain on track to achieve full-year production guidance of 420,000 to 470,000 oz AuEq2, with production expected to increase significantly in the second half of the year as we gain access to higher-grade stopes at both Media Luna and ELG Underground. We have already begun to see the benefit of higher grades through July, with monthly production of 43,431 oz AuEq1including 32,898 oz of gold.

"The Company generated $94 million of free cash flow3during the quarter, net of $39 million in Mexican profit-sharing payments related to fiscal 2025, supporting further capital returns to shareholders and continued strengthening of our balance sheet. During the quarter, we returned $55 million to shareholders, including $44 million through share repurchases. Year-to-date, $176 million has been returned to shareholders, representing 50% of our targeted annual return of $350 million.

"All-in sustaining costs3("AISC") of $2,459 per oz AuEq sold were elevated, reflecting the impact of lower grades on production and sales, higher plant reagent costs to support gold recoveries, including consumption rates and unit pricing, as well as the continued strength of the Mexican peso. While increased production is expected to benefit AISC during the second half of the year, these cost pressures are expected to persist. As a result, we have revised our AISC guidance to $2,000 to $2,100 per oz AuEq sold2from $1,750 to $1,850 per oz AuEq sold2. Despite these pressures, the Company remains in an excellent position to continue generating significant free cash flow.

"Project development remains on track, with Media Luna North on schedule to deliver first production by year end. With the Los Reyes preliminary economic assessment now complete, work has commenced on the prefeasibility study which we expect to complete by late 2027. Ongoing exploration results at Morelos continue to be highly encouraging, particularly along the southern and eastern extensions of the Media Luna orebody. As a result, we have accelerated drilling in those areas with an additional 13,400 metres planned this year, targeting an expansion of the resource inventory as part of our year-end update expected in March 2027.

"With mining and processing rates continuing to exceed design levels, higher production expected over the coming quarters, Media Luna North and Los Reyes progressing as planned, the 2026 drilling and exploration programs across our portfolio well underway, and a robust return of capital program in place, Torex is well positioned to deliver a very strong second half of the year."

Q2 2026 HIGHLIGHTS

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Safety performance:The Company recorded no lost-time injuries during the first half of 2026 and maintained a lost-time injury frequency ("LTIF") of 0.00 per million hours worked for both employees and contractors on a rolling 12-month basis.

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Gold production:Production of 96,297 gold equivalent ounces ("oz AuEq") (YTD - 197,171 oz AuEq1), including 69,278 oz of gold (YTD - 142,925 oz of gold). Mining rates remained strong during the second quarter, averaging approximately 7,700 tpd at Media Luna and 3,000 tpd at ELG Underground. During the quarter, throughput at the processing plant exceeded design levels, averaging 10,793 tpd. With higher grade and higher gold recovery stopes expected to be mined through the second half of the year, production is tracking to the midpoint of annual gold equivalent guidance of 420,000 to 470,000 oz2AuEq1.

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Gold sold: Gold equivalent ounces sold of 92,351 oz AuEq1(YTD - 201,573 oz AuEq1) at a quarterly average realized gold price3of $4,525 per oz AuEq1(YTD - $4,665 per oz AuEq1), contributing to revenue of $406.9 million (YTD - $946.2 million). Revenue for the quarter includes a net loss of $7.0 million (YTD - $31.0 million) for price adjustments on provisionally priced concentrate sales (a realized loss of $8.7 million on final sales settlements during the second quarter and an unrealized gain of $1.7 million on provisional sales pending final settlement), primarily reflecting lower gold and silver prices in the quarter. In the second quarter of 2026, the Company recognized a net derivative loss of $0.4 million (an unrealized loss of $12.8 million and a realized gain of $12.4 million) on quotational period hedges entered into to mitigate price risk on provisionally priced sales.

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All-in sustaining costs3:Quarterly all-in sustaining costs of $2,459 per oz AuEq sold1 (YTD - $2,165 per oz AuEq sold1) and all-in sustaining costs margin3of $2,066 per oz AuEq sold1(YTD - $2,500 per oz AuEq sold1), implying an all-in sustaining costs margin3of 46% (YTD - 54%). Cost of sales was $228.5 million or $2,474 per oz AuEq sold1in the quarter (YTD - $455.2 million or $2,258 per oz AuEq sold1). As a result of continued strength in the Mexican peso, higher plant reagent costs associated with lower gold recoveries (consumption rates and unit prices), higher mining volumes, an increase of $15.0 million to sustaining capital expenditures reflecting the impact of a stronger Mexican peso on development costs and additional equipment leases, and the impact of higher metal prices on royalties and land access payments, full year all-in sustaining costs guidance has been revised to $2,000 to $2,100/oz AuEq1,2sold from $1,750 to $1,850/oz AuEq1,2sold.

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Strong profitability and adjusted EBITDA3:Reported quarterly net income of $113.8 million (YTD - $321.3 million), or $1.22 per share (basic) (YTD - $3.41) and adjusted net earnings of $84.9 million (YTD - $284.6 million), or $0.91 per share (basic) (YTD - $3.02). Generated EBITDA of $209.1 million (YTD - $567.2 million) and adjusted EBITDA of $203.5 million (YTD - $562.1 million).

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Cash flow generation:Net cash generated from operating activities totalled $167.6 million (YTD - $377.4 million) and $165.1 million (YTD - $339.3 million) before changes in non-cash operating working capital. Net cash generated from operating activities included income taxes paid of $52.5 million (YTD - $193.2 million) and $39.3 million paid in the second quarter of 2026 in relation to the site-based employee profit sharing program for 2025 in Mexico. Free cash flow3of $94.2 million (YTD - $251.5 million) is net of cash outlays for capital expenditures, lease payments, and interest.

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Strong financial liquidity: In July, the Company amended its fully undrawn $350.0 million revolving credit facility, extending the maturity by one year to June 2030, while maintaining the $200.0 million accordion feature that is available at the discretion of the lenders. The quarter closed with $506.3 million in available liquidity3, including $169.4 million in cash and $336.9 million available on the $350.0 million credit facility, net of letters of credit outstanding of $13.1 million.

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Media Luna North Project:During the second quarter of 2026, $12.0 million (YTD - $26.7 million) of non-sustaining capital expenditures were incurred relating to the development of Media Luna North. Development of the main access ramp and haulage drift continue to track well. First production at Media Luna North remains on track for late 2026.

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Exploration and drilling activities4:In July, the Company announced results from its drilling and exploration programs within the ELG Underground and Media Luna Cluster. Results to date support the Company's objective of expanding resources while enhancing and extending the current production profile of the Morelos Complex.

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ELG Underground: Drilling results continue to demonstrate the potential to replace reserves and expand resources, with mineralization extended along the El Limón Sur and El Limón West trends and continued success in identifying mineralization at depth and along strike beyond the current resource boundaries.

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Media Luna Cluster: Drilling results support resource growth through the potential expansion of mineralization to the south and east of the Media Luna deposit, while ongoing drilling at Media Luna North continues to de-risk the planned start of production and identify extensions at depth.

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Regional exploration: Drilling continued to advance at priority target Atzcala while initial drilling commenced at El Naranjo. The programs at both are focused on evaluating resource potential more broadly across the Morelos Property.

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Revised expenditures:Exploration and drilling expenditures are now forecast at $85.0 million (previously $77.0 million) given an expanded drilling program to test the eastern and southern extensions of the Media Luna deposit within the recently identified San Miguel Corridor. The Company believes the San Miguel Fault could potentially be the main source for mineralizing fluids within the Media Luna Cluster.

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Return of capital to shareholders5: In May, the Company announced an enhanced return of capital program targeting the return of $350.0 million to shareholders during 2026, through a combination of share purchases and dividends. Through the first half of 2026, the Company returned $176.2 million, representing approximately 50% of the targeted threshold for 2026.

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Dividends: During the second quarter of 2026, the Company paid dividends of $10.8 million (YTD - $21.2 million). On August 6, 2026, the Company declared a quarterly dividend of C$0.16 per common share ("Torex Share"), payable on September 4, 2026, to shareholders of record on August 21, 2026.

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Share Repurchases: During the first half of 2026, the Company repurchased 3,132,783 Torex Shares for $155.0 million (C$212.8 million) at an average price per share of $49.47 (C$67.91).

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Los Reyes Preliminary Economic Assessment ("PEA")6:On July 7, 2026, the Company released the results of the PEA for its Los Reyes project in Sinaloa, Mexico. The PEA estimates an after-tax NPV (5%) of $1,491 million, an after-tax IRR of 37.3%, a 1.9-year payback period and average annual production of 134 koz AuEq6over a 14.4-year mine life (161 koz AuEq6over first 11 years). The project is expected to generate robust margins, with life-of-mine all-in sustaining costs averaging $1,617/oz AuEq6and an estimated upfront capital investment of $515 million, which is expected to be fully funded through cash flows generated by the Morelos Complex.

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Responsible Gold Mining Report:In May, the Company released its 2025 Responsible Gold Mining Report, highlighting continued progress across its environmental, social and governance initiatives. This included commissioning of a new solar plant, improved water recycling, reduced greenhouse gas emissions, industry-leading safety performance and adherence to global sustainability standards.

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Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO") Transition:Effective June 17, 2026, Andrew Snowden assumed the role of President and CEO following the retirement of Jody Kuzenko. Concurrently, Dan Rollins, formerly Senior Vice President, Corporate Development & Investor Relations, assumed the role of CFO.

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Planned U.S. Listing:The Company plans to pursue a secondary listing of Torex shares on the NYSE within the coming months. Preparation for the listing is underway, and the Company intends to prepare the required regulatory filings and exchange application in due course. An update on timing of a U.S. listing is expected to be provided with the release of Q3 2026 financial results.

CONFERENCE CALL AND WEBCAST DETAILS

The Company will host a conference call tomorrow at 9:00 AM (ET) where senior management will discuss the second 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.

FOOTNOTES

1. Gold equivalent ounces produced and sold include production and sales of silver (Ag) and copper (Cu) 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 June 30, 2026, market prices averaged $4,506/oz gold (Au), $73.15/oz Ag, and $6.05/lb Cu, and AuEq (oz) = Au (oz) + 1,000 (73.15 / 4,506) x Ag (koz) + 1,000,000 x (6.05 / 4,506) x Cu (mlb). For the six months ended June 30, 2026, market prices averaged $4,693/oz Au, $78.83/oz Ag, and $5.93/lb Cu, and AuEq (oz) = Au (oz) + 1,000 (78.83 / 4,693) x Ag (koz) + 1,000,000 x (5.93 / 4,693) x Cu (mlb). For the month of July 2026, market prices averaged $4,074/oz Au, $58.56/oz Ag, and $6.13/lb Cu, and AuEq (oz) = Au (oz) + 1,000 * (58.56 / 4,074) x Ag (koz) + 1,000,000 x (6.13 / 4,074) x Cu (mlb). 2. Production guidance is reiterated using revised metal pricing assumptions of $4,500/oz Au, $72.50/oz Ag, and $6.00/lb Cu, and AuEq (oz) = Au (oz) + 1,000 (72.50/ 4,500) x Ag (koz) + 1,000,000 x (6.00/ 4,500) x Cu (mlb). Revised guidance for all-in sustaining costs also reflects revised commodity price assumptions and AuEq formula. Original 2026 production and AISC guidance assumed metal prices of $4,000/oz Au, $45.00/oz Ag, and $4.90/lb Cu, and AuEq (oz) = Au (oz) + 1,000 (45 / 4,000) x Ag (koz) + 1,000,000 x (4.90 / 4,000) x Cu (mlb). 3. These measures 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, see Tables 2 to 11 of this press release. For additional information on these Non-GAAP Measures, please refer to "Non-GAAP Financial Performance Measures" of the Company's MD&A for the three and six months ended June 30, 2026, dated August 6, 2026. The MD&A and the Company's unaudited condensed consolidated financial statements and related notes for the three and six months ended June 30, 2026, are available on Torex's website (www.torexgold.com) and under the Company's SEDAR+ profile (www.sedarplus.ca). 4. For more information on the Morelos exploration and drilling results, see the Company's news release titled "Torex Gold Provides Q2 2026 Morelos Drilling & Exploration Update" issued on July 13, 2026, and filed on SEDAR+ at www.sedarplus.caand on the Company's website at www.torexgold.com. 5. For more information on the Company's return of capital program, see the Company's news release titled "Torex Gold Reports Enhanced Return of Capital Program" issued on May 6, 2026, and filed on SEDAR+ at www.sedarplus.caand on the Company's website at www.torexgold.com. 6. Gold equivalent ounces for the Los Reyes Preliminary Economic Assessment are calculated using assumed metal prices of $3,600/oz Au and $50/oz Ag. AuEq (oz) = Au (oz) + Ag (oz) + 1,000 * (50 / 3,600). For more information on the Los Reyes Preliminary Economic Assessment, see the Company's news release titled "Torex Gold Releases Results of Los Reyes Preliminary Economic Assessment" issued on July 7, 2026, and filed on SEDAR+ at www.sedarplus.caand on the Company's website at www.torexgold.com.

Table 1: Operating and Financial Highlights

| | | | Three Months Ended | | | Six Months Ended | | | | | | | | | | | | | | | Jun 30, | | | Mar 31, | | | Jun 30, | | | Jun 30, | | | Jun 30, | | | In millions of U.S. dollars, unless otherwise noted | | 2026 | | | 2026 | | | 2025 | | | 2026 | | | 2025 | | | | Safety | | | | | | | | | | | | | | | | | | Lost-time injury frequency1 | /million hours | | 0.00 | | | 0.00 | | | 0.46 | | | 0.00 | | | 0.46 | | | Total recordable injury frequency1 | /million hours | | 0.63 | | | 0.61 | | | 1.00 | | | 0.63 | | | 1.00 | | | Operating Results - Gold Equivalent basis | | | | | | | | | | | | | | | | | | Gold equivalent produced | oz AuEq | | 96,297 | | | 100,874 | | | 84,296 | | | 197,171 | | | 144,073 | | | Gold equivalent payable produced2 | oz AuEq | | 93,686 | | | 98,482 | | | 82,856 | | | 192,168 | | | 142,486 | | | Gold equivalent sold2 | oz AuEq | | 92,351 | | | 109,222 | | | 76,922 | | | 201,573 | | | 137,490 | | | Total cash costs2,3 | $/oz AuEq | | 1,912 | | | 1,534 | | | 1,606 | | | 1,707 | | | 1,348 | | | All-in sustaining costs2,3 | $/oz AuEq | | 2,459 | | | 1,917 | | | 2,103 | | | 2,165 | | | 1,796 | | | Average realized gold price2,3 | $/oz AuEq | | 4,525 | | | 4,784 | | | 3,299 | | | 4,665 | | | 3,077 | | | Financial Results | | | | | | | | | | | | | | | | | | Revenue | $ | | 406.9 | | | 539.3 | | | 253.9 | | | 946.2 | | | 423.9 | | | Cost of sales | $ | | 228.5 | | | 226.7 | | | 152.6 | | | 455.2 | | | 246.7 | | | Earnings from mine operations | $ | | 178.4 | | | 312.6 | | | 101.3 | | | 491.0 | | | 177.2 | | | Net income | $ | | 113.8 | | | 207.5 | | | 83.2 | | | 321.3 | | | 122.2 | | | Per share - Basic | $/share | | 1.22 | | | 2.18 | | | 0.97 | | | 3.41 | | | 1.42 | | | Per share - Diluted | $/share | | 1.20 | | | 2.16 | | | 0.95 | | | 3.38 | | | 1.40 | | | Adjusted net earnings3 | $ | | 84.9 | | | 199.7 | | | 43.8 | | | 284.6 | | | 79.7 | | | Per share - Basic3 | $/share | | 0.91 | | | 2.10 | | | 0.51 | | | 3.02 | | | 0.92 | | | Per share - Diluted3 | $/share | | 0.90 | | | 2.08 | | | 0.50 | | | 2.99 | | | 0.91 | | | EBITDA3 | $ | | 209.1 | | | 358.1 | | | 114.1 | | | 567.2 | | | 202.2 | | | Adjusted EBITDA3 | $ | | 203.5 | | | 358.6 | | | 117.7 | | | 562.1 | | | 209.5 | | | Cost of sales - gold equivalent basis | $/oz AuEq | | 2,474 | | | 2,076 | | | 1,984 | | | 2,258 | | | 1,794 | | | Net cash generated from operating activities | $ | | 167.6 | | | 209.8 | | | 67.8 | | | 377.4 | | | 57.9 | | | Net cash generated from operating activities before changes in non-cash operating working capital | $ | | 165.1 | | | 174.2 | | | 95.3 | | | 339.3 | | | 77.6 | | | Free cash flow3 | $ | | 94.2 | | | 157.3 | | | (37.5 | ) | | 251.5 | | | (170.8 | ) | | Cash and cash equivalents | $ | | 169.4 | | | 130.0 | | | 103.0 | | | 169.4 | | | 103.0 | | | Debt, net of deferred finance charges | $ | | - | | | - | | | 227.2 | | | - | | | 227.2 | | | Lease-related obligations | $ | | 99.4 | | | 101.1 | | | 98.9 | | | 99.4 | | | 98.9 | | | Net cash (debt)3 | $ | | 70.0 | | | 28.9 | | | (225.9 | ) | | 70.0 | | | (225.9 | ) | | Available liquidity3 | $ | | 506.3 | | | 466.9 | | | 209.1 | | | 506.3 | | | 209.1 | |

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 and six months ended June 30, 2026, dated August 6, 2026 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, all-in sustaining costs, average realized gold price, adjusted net earnings, adjusted net earnings per share, EBITDA, adjusted EBITDA, free cash flow, net debt 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 and six months ended June 30, 2026, dated August 6, 2026. The MD&A and the Company's unaudited condensed consolidated interim financial statements and related notes for the three and six months ended June 30, 2026, are available on Torex's website (www.torexgold.com) and under the Company's SEDAR+ profile (www.sedarplus.ca).