Morning, ladies and gentlemen, and welcome to Lundin Gold's Fourth Quarter and Fiscal Year 2025 Conference Call. At this time, all lines are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session. If anyone has any difficulties hearing the conference, please press star zero for operator assistance at any time. I would now like to turn the conference call over to Jamie Beck, President and CEO. Please go ahead.
Thank you, operator, and good morning, everyone. Thank you all for joining us today. I'm joined here by Terry Smith, our Chief Operating Officer, and Chester See, our Chief Financial Officer. We're going to take you through our results for the fourth quarter and full year 2025. Please note Lundin Gold's disclaimers on this slide. This discussion includes forward-looking information. Actual future results may differ from expected results for a variety of reasons described in the "Caution Regarding Forward-Looking Information and Statements" section of our press release. Lundin Gold is a US dollar reporting entity, and all amounts in this presentation refer to US dollars unless otherwise indicated. 2025 was an exceptional year for Lundin Gold, marked by strong operational delivery, record financial performance, and important advances across our growth pipeline.
At Fruta del Norte, we produced approximately 498,000 oz of gold and sold 503,000 oz. Our average head grade was 9.5 g/t, average recovery was 89%, and the mill processed over 1.8 million tonnes at a record average throughput of 5,009 tonnes per day. These results underscore the consistency of the operation and the success of our ongoing optimization work. Amidst strong gold prices, we remain focused and disciplined on our cost performance. For the year, cash operating costs averaged $838 per oz, and our all-in sustaining costs averaged $1,015 per oz, resulting in a basic margin of 72%. The combination of robust production and disciplined costs translated directly into record financial outcomes.
From a cash generation standpoint, we delivered $1 billion of cash flow from operations and $926 million of free cash flow in 2025. After paying $664 million in dividends in the year, we ended the year with $630 million in cash. For the fourth quarter, we annozd a dividend of $1.15 per share, or approximately $278 million, which will be payable on March 26 this year. These results reflect our continued focus on returning capital while maintaining balance sheet strength. On growth, we achieved a major milestone with the inclusion of FDNS into mineral reserves, and we are now proceeding with underground development.
We have advanced our mine-to-mill expansion study that will evaluate increasing throughput beyond 5,500 tonnes per day, and we continue to demonstrate the district scale potential of our land package, expanding the epithermal gold deposits at both FDNS and FDN East, as well as identifying five copper gold porphyries within the emerging corridor. Turning briefly to the quarter, the fourth quarter was the strongest in our history on multiple measures. Revenue reached $527 million, net income was $234 million, EBITDA was $364 million, free cash flow at $328 million. Earnings per share were $0.97, and our AISC margin per oz climbed to $3,106, each representing a quarterly record and significant year-over-year increase.
This performance reflects both continued operational excellence and our ability to capture margin in a strong gold price environment. With that, I'd like to now turn the call over to Terry to discuss our operations in more detail.
Thanks, Jamie, and good morning, everyone. I'm very proud of our team that delivered great production results yet again, and we did it safely. We started 2025 with a goal to improve our safety performance, and I'm pleased to report that we recorded no lost time incidents and achieved our lowest annual total recordable incident rate ever. This accomplishment speaks to the team's strong commitment to safe production. While preventing injuries is our objective, we continue to focus on leading indicators and getting out in the field, reinforcing behaviors that keep our people safe every day. Operationally, the fourth quarter capped a year of consistent delivery and steady optimization. In Q4, we achieved record mining output of 501,301 tonnes.
The mill processed 484,950 tonnes at an average of 5,271 tonnes per day, even with the reduced operating hours during unplanned maintenance activities at the mill. This is a 14% increase as compared to Q4 2024, when the plant expansion project was largely complete. Our progress through the year keeps us on track toward our goal of averaging 5,500 tonnes per day in 2026. For the full year, we achieved our elevated 2025 production guidance range of 490-525,000 oz, finishing the year with 498,315 oz produced. We recently added a portion of the growing FDNS deposit into our mineral reserves, marking an important step forward for this emerging ore body.
With this milestone, underground development toward the deposit will proceed. We currently anticipate non-sustaining capital of $30-$35 million in 2026 associated with FDNS development. FDNS is also being integrated into our mine-to-mill expansion study, which is evaluating opportunities to sustain higher mining rates by incorporating FDNS into the broader mine plan, together with potential plant de-bottlenecking and upgrades to supporting increased throughput. Our intention is to make a single integrated investment decision in 2026, informed by analysis of the most efficient mining rates at both FDN and FDNS, along with options to increase processing capacity beyond 5,500 tonnes per day. Further estimates for non-sustaining capital associated with FDNS development and the potential plant expansion will be provided as these studies continue to advance and are finalized. With that, I'll turn the call over to Chester to discuss our financial performance.
Thanks. Thanks, Terry, and good morning, everyone. I'll begin with our quarterly and full-year financial results, then move to cash flow and our dividend. The fourth quarter delivered record results. Net revenues were $527 million, and income from mining operations was $373 million. Net income for the quarter was $234 million, and we generated EBITDA of $364 million. Free cash flow in Q4 was $328 million, reflecting strong operations and continued margin capture. For the year, net revenues totaled $1.78 billion, net income was $792 million, and EBITDA reached $1.24 billion.
We generated $926 million in free cash flow for 2025, and our cash operating costs and AISC were $838 and $1,015 per oz, respectively. These cost metrics were above our 2025 guidance range, primarily because our guidance was based on a gold price assumption of $2,500 per oz, while average realized gold price for the year was $3,594 per oz or an increase of approximately $1,100. For every $100 per oz increase in gold price, our cash operating costs and AISC are impacted by $10 per oz due to royalties and statutory profit sharing. This implies a $110 per oz impact on our cost metrics, well above the $60 range we used for our guidance.
Turning to free cash flow in more detail, Q4 free cash flow of $328 million contributed to a full year total of $926 million, reflecting strong underlying operating cash flow and modest capital spending requirements in 2025. Our capital intensity remains low, which, combined with our cost structure and realized pricing, supports robust free cash flow generation on a sustained basis. From a balance sheet perspective, as at December 31, 2025, we had working capital of $595 million, up from $459 million a year ago. During the year, we generated $1 billion in cash from operating activities and ended with $630 million in cash after paying $664 million in dividends. This strong liquidity position provides significant flexibility to both fund growth and continue delivering capital returns.
Consistent with our capital allocation framework and the strength of our Q4 free cash flow, the Board has declared a quarterly dividend of $1.15 per share, comprised of a $0.30 fixed dividend and $0.85 variable dividend. The variable dividend reflects 100% of normalized free cash flow this quarter, above the policy minimum of 50%. The total distribution is approximately $278 million, payable on March 26 to shareholders on record on March 11, with payment on March 31 for shares trading on Nasdaq Stockholm. For a more detailed discussion of our dividend and financial results, I encourage you to read our MD&A. I'll now turn the call back to Jamie.
Thanks, Chester. I'll spend a few minutes on our mineral reserves and resources and then provide an update on exploration. 2025 marked our largest FDN reserve and resource statement ever published, with the highest contained oz reported to date. Proven and Probable Reserves now stand at 5.85 million oz, an increase of 6% year-over-year, accounting for approximately 535,000 oz of mining depletion, and the inclusion of the inaugural FDNS reserve of 0.54 million oz. Measured and Indicated Resources total 7.48 million oz, also up 6% versus 2024, and include 0.77 million oz from FDNS, where an indicated material was confirmed at a higher grade than previously reported in the inferred category.
Inferred resources now total over 2 million oz, with 0.58 million oz added from FDNS and FDN East, including FDN East's inaugural inferred resource of 0.42 million oz. Since 2019, FDN has produced approximately 2.9 million oz and has added approximately 4 million oz of new reserves relative to the 2016 estimate, more than replacing depletion over that period. And these results continue to demonstrate the quality, scale, and longevity of this world-class district and its future potential. Turning to near mine exploration at FDNS, conversion drilling continued to confirm strong gold mineralization and helped define wider, higher grade zones within the broader mineral envelope that support further mineral reserve expansion.
In parallel, exploration drilling outside the current resource delivered several exceptional results, including one standout intercept of 20.65 ms at 91.32 grams per tonne, and also identified new veins to the south, as well as extensions to the north. Together, these results reinforce the significant growth potential of the FDNS system and highlight the ongoing opportunity to expand the mineralized footprint. At FDN East, exploration drilling has extended the footprint by approximately 150 ms beyond the inaugural mineral resource. The work confirms a broader mineralized trend than previously defined, and we see potential for extension undercover towards the Sandia Porphyry. The deposit remains an exciting and complementary opportunity immediately adjacent to our existing infrastructure. The emerging porphyry corridor on our concessions continues to deliver exceptional drilling results.
At Sandia, we reported our best porphyry intercept to date, 322 ms of 1.08% copper equivalent near surface. Drilling has outlined a large and still open mineralized system with strong continuity in multiple directions. Tranquiloma drilling is vectoring into a shallowing, high-grade potassic core, again demonstrating the presence of substantial mineralized center with room to grow. Castillo is a shallow copper-gold discovery approximately two km south of FDN, under about 100 ms of conglomerates, with a highlight intercept of 101 ms at 0.8% copper equivalent, confirming the southern continuity beneath the Suarez Basin. We also advanced at Tranquiloma West, where mineralization and alteration are consistent with what we see at Tranquiloma, and we identified Chontas as a fifth new porphyry system, some 7 km south, doubling the corridor from 5-10 km along strike.
Collectively, these results continue to demonstrate the significant district-scale copper-gold potential alongside our high-grade underground operation. Looking to 2026, our objectives are clear. We will remain focused on health, safety, and environmental performance. We intend to achieve our 2026 production and unit cost guidance. We also plan to execute a record 133,000-m exploration program as we continue advancing multiple growth fronts across the district. Importantly, FDNS is now incorporated into our mineral reserves and underground mine development towards that deposit will proceed. At the same time, we continue to advance our integrated mine-to-mill expansion study and plan to make an integrated investment decision in 2026. Informed by the analysis, the most efficient mining rates for both FDN and FDNS, and options to increase processing capacity beyond 5,500 tonnes per day.
As we continue to grow and strengthen the business, we remain committed to delivering meaningful shareholder returns through our disciplined dividend framework. Collectively, these initiatives position Lundin Gold for another year of strong performance and meaningful value creation. In closing, 2025 was a record year for Lundin Gold. We delivered both strong operational and financial performance. We advanced key growth catalysts and returned significant capital to our shareholders, all while maintaining a clean balance sheet and a relentless focus on safety and responsible mining. Thank you to our employees, contractors, communities, partners, and shareholders for your continued support. Operator, we're now ready to take any questions.
Thank you, ladies and gentlemen. We will now begin the question and answer session. Should you have a question, please press the star followed by the one on your touch-tone phone. If you wish to cancel your request, please press the star followed by the two. If you are using a speakerphone, please lift the handset before pressing any keys. Once again, that is star 1 should you wish to ask a question. Your first question is from Anita Soni from CIBC World Markets. Your line is now open.
Hi, good morning, Jamie and team. Thanks for taking my questions. I just wanted to ask about the study that you're gonna be putting out or sort of the decision that you're gonna make around FDN and FDNS. Is this a incremental—I think you said it was—is that constrained, I guess, by the mining rate. So are you considering a stepwise change or like a 25% increase to throughput? And I assume that would mean that you're accessing this by drift or are you considering sinking a shaft? And I think that would mean that you would probably have, you know, significantly more capital, but also significantly more throughput and a bigger change to the mill.
Can you just give us an idea of what you're kind of seeing at this point?
Yeah, Anita, thanks, thanks for the question. No, we see this as a relatively small incremental expansion to the existing facilities. This is unlikely going to require a shaft or anything like that. We'll be able to access from existing underground development that we're moving out towards the south. So this is really, I think, an opportunity for us to capture, you know, consistent production and see that sort of consistent production at these levels for a number of years moving forward. So being able to bring in FDNS and in a complementary way to what we're already mining at FDN. So yeah, these aren't a big, massive step change. This is another incremental expansion, I think, that will allow us to maintain production at current levels.
Okay. So the intention is the grade will probably decline, but you're gonna try to offset that with higher throughput?
Yeah, I think that's natural. You know, we've been mining at FDN, you know, 11, 12 grams for the first few years, now we're down in the 9s and the 8s, and you can see reserve grade ultimately trends a little bit lower than that. So the increased throughput will allow us to maintain that production profile.
Okay. And is there any change in terms of the way that you're like, as you're looking at it now from a mining, sorry, like, the mining methodology perspective, is there. It would be similar mining methodology, or are you seeing wider widths or anything like that?
Yeah, maybe I'll let Terry respond to that one.
Sure. Hey, Anita. Terry here. It is similar. There's, you know, we do transverse stoping in FDN, and so the stopes are, you know, big and wide and tall, and obviously very productive because of that configuration. What we have at FDNS is not as massive an ore system as we have at FDN. This is a series of stacked veins, and so we'll need to approach it with a long hole stoping method, but longitudinal stoping, so narrower and less productive stopes, but we'll have more of them in production at once than we do at FDN. Does that make sense?
Yeah, it does. So maybe higher development CapEx and higher mining costs as we're looking at that?
Yeah.
Okay. And then lastly, if you, can you give us an idea of, like, what kind-- you said $35 million for development for this year, but, you know, what's the timeframe that you expect to bring this on stream and, and the capital that you think you might be looking at?
Yeah, you know, I think that's, you'll see the language in our release, Anita, and what we talked about today. We'll come back sort of later on in the year with a more fully baked plan that'll lay out our, you know, our capital expenditures for this project over the next few years. But we see this having meaningful impact over the next three or four years, in terms of bringing FDNS into the mine plan, and actually starting to produce some oz.
Okay, thanks. I always have to give it a shot, but thanks for answering my questions.
Thank you. Once again, please press star one should you wish to ask a question. Your next question is from Don DeMarco from National Bank. Your line is now open.
Good morning, Jamie and team, and thanks for taking my question. So just wanted to build on the last caller's question about the FDNS. Could you add a little more color on the FDNS maiden reserves? I mean, I understand that this just reflects a portion of the inferred endowment, and so do you have rigs currently turning to convert that rest of that endowment? And then also, I see you're getting these high grades to the south, which is encouraging. Do you expect to potentially put that into an inferred category at some point this year? And then also, is there any scope for those intercepts to potentially lift the grades? Thanks.
Hey, Don. It's Terry. Yeah, so the reserves that we converted is obviously just getting started, and our intention is to continue to convert, you know, the 2 million oz that we have in the Inferred category up to Indicated with more drilling this year. So that's just part of the natural process of de-risking and expanding this project. And I know that the exploration team is gonna continue to expand the Inferred Resource beyond what we see today. So, yes to all your questions, I guess. I didn't quite catch the last thing that you asked, actually.
I think it was-
Sure
... around some of the grades.
Yeah, and, and, I mean, you would've seen from the, from the results on, you know, some of these grades are spectacular. In fact, FDNS has returned a number of sort of the top 10 holes from a grade perspective ever drilled on the project, 20+ ms of 90 grams. Last quarter, we put out, you know, around 5 ms of almost 500 grams. So just absolutely remarkable results, and I think we're seeing that, if you compare sort of our original inferred resource on FDNS last year to where we got to today, we've seen that grade kick up, and importantly, some of the conversion drilling that we're doing from underground is helping to guide that.
I think as we continue some of these high-grade hits, we've been positively surprised from a grade perspective and anticipate that may continue moving forward.
Okay, great. That's all for me. Thanks so much, guys.
Thank you. Once again, please press star one should you wish to ask a question. Your next question is from Charles A. Diamond from Jefferies. Your line is now open.
Yeah. Thank you very much. My question is on Bonza. So I wonder if you could provide some updates to us on that, and when we could expect some, maybe like, resource estimate on that front.
... I'm sorry, Charles, your line was breaking up a little bit on our end. Would you mind repeating the question?
Yeah, definitely. I was asking about Bonza Sur. So I wonder if you could provide some updates on that front, if we could expect any resource estimates anytime soon.
Yeah, thank you. It's around Bonza Sur, and I think one of the things that's opening up our development at FDN South is allowing us to take a look at with the mine development now moving towards the South. Are there going to be opportunities for us to think about taking a look at Bonza Sur a little bit differently? You may recall, you know, in the early days of discovery of Bonza Sur and thinking there, our original thoughts were around potentially accessing that from open pit methods, from surface.
We now see opportunity to consider whether or not we can, we can get at some of the, the higher grade portions of that Bonza Sur deposit from underground, especially as, as the northern part of Bonza Sur, starts pushing up against the southern part of, of FDN South, and, and the success that we're having with, extending FDN South, with our, conversion and exploration drilling. So that's gonna be, that's gonna be a, a priority for us this year for sure. I, I, I'm not really, you know, gonna guide you 100%, at this point in time, but if there's opportunities for us to, to look towards pulling some of that Bonza Sur mineralization, into our future long-term, planning, we will, we'll be evaluating that pretty closely this year.
Thank you. That's all for me.
Thank you. There are no further questions at this time. I will now hand the call back over to Jamie Beck for the closing remarks.
Okay. I just thank you so much, operator. I think we are super excited about our growth potential at Fruta del Norte. It's been really interesting to see all of this exploration work come together and to have that supported by such strong operations this year, as we mentioned, was remarkable in terms of record financial and operational performance. Our dividend, you know, continues to be strong with a clean balance sheet. I think the future remains bright at Fruta del Norte, and we look forward to delivering on our 2026 objectives over the year.