G Mining Ventures Corp. (GMIN) Earnings Call Transcript & Summary

Good morning, everyone, and thanks for joining us for G Mining Ventures' conference call on the results for the second quarter of 2026. Everyone on the line is in listen-only mode for now. After the prepared remarks, we'll take questions from the lines. Just a reminder that this call is being recorded today. I'll hand things over now to Jean-François Lemonde, Vice President Investor Relations.

Thanks, operator, and good morning to everyone who has joined G Mining's conference call covering operational and financial results for the second quarter of 2026. Joining me on the line are Louis-Pierre Gignac, our Chief Executive Officer, and Julie Lafleur, our Chief Financial Officer and VP Finance. I'd like to remind all of you that once management has finished its remarks, a Q&A session will follow. Since forward-looking statements will be made during this call, please refer to the cautionary notes and risk disclosure found in our MD&A and on slide 2 of the webcast presentation. Also, please keep in mind that, unless otherwise noted, every dollar amount mentioned on the call is in US dollars. I'll now hand the call over to Louis-Pierre Gignac for an overview of the quarter.

Good morning, and thank you, JF, and thanks to all of you for being with us today. I'd like to begin by acknowledging the hard work of our teams at every one of our sites, whose dedication to safety, operational excellence, and responsible mining keeps driving our success. Q2 2026 was a strong quarter for G Mining — operationally, financially, and strategically. Tocantinzinho posted a solid quarter, and construction at Oko West is moving forward according to plan. On the strategic side, G Mining completed the transformational acquisition of G2 during the quarter, bringing G Mining's Oko West and G2's adjacent Oko-Aremu project together into one large-scale, long-life Tier 1 gold mining complex. Importantly, TZ kept delivering in the quarter, producing 36,845 ounces, a 16% increase over Q1 2026, with 37,439 ounces sold. That improvement came from a higher grade mining sequence and stable mill performance as we progress toward accessing the higher-grade phase 2 mineralization. Free cash flow rose more than 50% to $85 million quarter-over-quarter, generating approximately $2,300 of free cash flow per ounce of gold produced. Throughout the year, we'll stay focused on protecting margins and maximizing the free cash flow generated from every ounce we produce. Second quarter gold production beat plan, helped by higher grades and strong metallurgical recoveries.

During the quarter, TZ kept plant performance steady, processing slightly more than one million tonnes of ore at an average throughput of 11,120 tonnes per day. Process grade averaged 1.23 grams per tonne gold, and recovery averaged 91.9%. Mining activity was strong as well, with a record 6.3 million tonnes of ore and waste taken from the open pit in the quarter, a 15% rise over Q1 2026. The corporation is holding to its 2026 production guidance of 160 to 190,000 ounces, with roughly 61% of output anticipated in the second half of 2026 as higher-grade material is reached in line with the mine plan. Safety performance stayed strong at TZ and across every project in the quarter, as G Mining recorded zero lost-time injuries. We kept delivering strong margins in the quarter, helped by a record average realized gold price of $4,197 per ounce and all-in sustaining costs of $1,690 per ounce sold. Q2 2026 cash costs of $1,046 per ounce sold came in 1% above Q1 2026, while all-in sustaining cost rose 6% to $1,690 per ounce sold, mainly reflecting the impact of a stronger Brazilian Real against the US dollar. Consequently, we have revised our full-year 2026 cash cost and all-in sustaining cost guidance to $836 to $965 and $1,330 to $1,544 per ounce sold, respectively, versus earlier guidance of $736 to $865 and $1,230 to $1,444 per ounce sold.

These changes mostly come from how the stronger Brazilian Real has affected our cost base. Now I'll hand things over to Julie, who will walk you through the financial results, cash flow, and balance sheet.

Thanks, Louis-Pierre, and good morning, everyone. In Q2, G Mining posted outstanding financial results, which speak to the strength of our asset portfolio, our solid operational execution, and our ongoing leverage to the gold price. Second quarter revenue climbed 21% year-over-year to $157 million, driven by 37,439 ounces sold at an average realized gold price of $4,197 per ounce. For the 6 months ended June 30, 2026, G Mining also reported higher revenue growth, returning 31% increase year-over-year, reporting $297 million in revenue for the period. Net income reported for the quarter grew by 48% to $72 million, or 30 cents per basic share, compared to net income of $48.6 million, or 21 cents per share, for the same period last year. On an adjusted basis, net income was $79 million in the second quarter, or 33 cents per share, versus an adjusted net income of $36.5 million, or 16 cents per share, reported for the second quarter of 2025. Adjusted net income excludes a $1.4 million unrealized foreign exchange loss, a $4.9 million loss on the change in fair value of financial instrument, a $0.4 million deferred income tax expense, and a $0.5 million present value adjustment on VAT receivables. Second quarter EBITDA was $106.9 million, and adjusted EBITDA was $113.7 million, both metrics performing better than the same period last year.

TZ kept producing robust free cash flow, which highlights its solid margin profile as we push Oko West forward along with fully funded exploration programs throughout the portfolio. Operating activities generated $104 million of cash in the quarter, and free cash flow came to $85 million once sustaining capital and other adjustments are taken into account. Cash used in investing activities during the quarter was $153 million, mainly reflecting construction spending at Oko West. Cash and cash equivalents fell from $287 million on March 31, 2026, to $226 million on June 30, 2026, which reflects continued heavy investment at Oko West during a peak construction period. We went from net cash of $248 million at the close of Q1 to net cash of $193 million at quarter end — a strong balance sheet position as we carry Oko West through the rest of construction. Counting the undrawn $350 million revolving credit facility, available liquidity stood at roughly $576 million. Capital expenditures came in at about $158 million in the second quarter of 2026, made up of $10.6 million of sustaining capital, $8.3 million of capitalized waste stripping, $8 million of capitalized exploration expenditures, and $131.3 million tied to development activities at Oko. Across the first 6 months of 2026, capital expenditures reached $266.2 million in total, consisting of $12.9 million of sustaining capital, $18.9 million of capitalized waste stripping, $0.8 million of sustaining exploration, $13.9 million of capitalized exploration expenditures, and $219.8 million tied to development activities at Oko.

Our capital guidance for Oko West hasn’t changed: we expect $514 million to $568 million in 2026 and $217 million to $240 million in 2027. At Oko, spending accumulated so far is roughly $423 million — about 44% of the approved initial capital budget — which leaves $550 million still to be spent through completion. Commitments total approximately $628 million, or 65% of the approved budget. That remains a significant de-risking milestone, since close to two-thirds of the initial capital budget now sits within committed scope. For the 6 months ended June 30, 2026, G Mining delivered approximately 39% of full-year gold production guidance, consistent with mine plans. Our 2026 production guidance is still 160,000 to 190,000 ounces of gold. Total cash cost guidance and AISC have been revised upwards, as noted earlier, to $836 to $965 per ounce sold and $1,330 to $1,544 per ounce sold, respectively. For 2027, production guidance remains 200,000 to 235,000 ounces of gold, with total cash costs expected to fall to $633 to $743 per ounce sold and AISC expected to fall to $977 to $1,146 per ounce sold. The 2027 profile reflects a full year of higher-grade phase 2 contribution, lower sustaining capital than in 2026, and continued operating maturity at TZ.

That brings my comments to a close. At this point I'll hand the call over to Louis-Pierre, who will cover Oko West and Gurupi.

Thanks, Julie. Oko is still moving forward right on schedule and within budget for the quarter. By the close of Q2, total project advancement hit 28% as measured on an earned value basis. Detailed engineering keeps progressing on schedule and stays on track to wrap up in Q3 2026, and procurement is roughly 99% done. Out in the field, construction is moving ahead on schedule throughout the main work areas, such as the process plant, power plant, tailings storage, and site infrastructures. The power plant is still on track to be running by the end of July 2027, and the grinding mills by August 2027, and deliveries of major components keep going according to plan. Notable accomplishments this quarter included ongoing concrete pours at the power plant, SAG and ball mill foundations, primary crusher, CIL, CIP tanks, and pre-leach thickener. Other important infrastructure work streams moved forward as well, among them the permanent camp, which now holds over 1,400 beds, with the welcome center, kitchen, and dining hall all up and running. The workforce kept expanding this quarter too. Site personnel now number 1,779, with Guyanese nationals making up 77% of the workforce, and total hours worked so far have passed 2.3 million. I'd like to spend a moment showing some visuals of how things are progressing on the ground as of June 30th, 2026.

Turning to our power plant, it keeps moving forward nicely — over 1,350 cubic meters of concrete have been poured so far, and the structural steel framing for the engine hall is now finished. Every one of the 6 generators has arrived and is being kept at our barge landing facility. The SAG mill foundation is done, with anchor bolts and embedded plates installed, and the first concrete pour for the ball mill foundation is set for August. The primary crusher has come a long way as well: the mat foundation concrete pour is finished, and rebar and concrete work on the first level is due to start in August. Work on the pre-leach thickener is also moving ahead, with construction of exterior rings 2 and 3 now over halfway done. The current Oko West project is still on schedule, with first gold targeted for the second half of 2027 and commercial production expected in January 2028. An updated feasibility study that integrates Oko West and Oko-Aremu is targeted for mid-2027. To support that study, we intend to finish definition drilling at Oko-Aremu and push technical studies forward to optimize mine sequencing and throughput for the expanded project. The integrated development plan should support an expanded production profile in 2029. I'll wrap up with a recap of our priorities for the rest of 2026 and into 2027.

For TZ, what matters most in the back half of this year is delivering the production plan we've laid out and pushing unit costs down. The main things we're concentrating on are moving phase 2 access forward, getting more productivity out of mining, accumulating drilled and blasted inventory, fine-tuning throughput and recoveries, and carrying out sustaining capital programs. Over at Oko West, we're still centered on the major project milestones, which include mill deliveries, power infrastructure, camp expansion, process plant construction, and progress on the tailings storage facility. When it comes to Gurupi, the main deliverables are the updated mineral resource estimate, the preliminary economic assessment, and the ESIA filing, and all of that is targeted for year end. Now that the G2 transaction is complete, our attention can go to advancing the technical work needed to validate the combined district plan so we can establish a Tier 1 production profile. We're heading into this next phase with a stronger balance sheet, a producing mine that generates steady cash flow, and a Tier 1 asset moving through construction while we strengthen our district position in Guyana, with Gurupi progressing toward key catalysts. We've got the assets, the liquidity, and the team needed to pull off this next phase of growth. With that, I'd like to hand the call back to the operator for questions.

Thanks. At this point we'll open things up for questions. If you'd like to ask one, hit star one on your phone's keypad. Should you wish to pull your question, press star one again. Please keep to a single question plus one follow-up. We'll take a brief pause while the queue is put together. Our first question comes from Ralph Profiti at Stifel. Go ahead.

Thanks, operator. Morning, everyone, and thanks for taking my questions. Louis-Pierre, will there be any operational impact from this implementation roadmap on some of the tailings governance works that were delivered at TZ in June 2026? Or perhaps an impact on growth capex or sustaining capex? I'm just trying to get a sense of whether these assessments fall within sort of manageable expectations.

When you say TZ, that's who you mean, correct?

Yes, sir.

Yeah. No, at present, as part of what we're spending on sustaining capex in this year, we're carrying out a raise of the tailings at the flotation tailings facility that we operate. All of that has been permitted, and it's proceeding according to plan where costs are concerned. We're permitted even past the raise we're doing at present, basically for another lift after that. There aren't any genuine permitting challenges or issues ahead of us.

Thanks. That's really good to hear. So then turning to Oko, since detailed engineering is at 90% and procurement is basically done, I'm curious whether you're taking the opportunity to order some of the long-lead items for the possible expansion case, and whether we might see part of that spending timeline for that production actually folded into some of the spending committed in, say, 2027?

That is a good question. Clearly, we are examining the long-lead items needed for the expansion right now. In fact, we anticipate placing orders for some of those long-lead items before the year ends. Specifically, that covers another ball mill plus some extra gensets that would be needed to supply power to a larger site. This year that will really be small money, which consists of milestone-driven payments for the down payments on that equipment during this year.

All right, I appreciate that, and thanks for taking the initiative. Thank you.

Sure.

Andrew Mikitchook from BMO Capital Markets has the next question.

I appreciate the question, and thanks for following up on Oko. We're giving guidance that the combined mine plan is coming, and as you noted, we're thinking about ordering long-lead equipment. Is there a position where short-term changes could occur to the mine plan—or even to the sequence of mining, stripping, or stockpiling—well before that?

Yes, there probably could be, in the sense that the government has given us the go-ahead to begin some initial mining at G2. That will let us carry out some optimization of the mine plan and, yes, make a few adjustments. Essentially, we still have to go through a permitting process with the government in order to make an amendment to the permit we hold. We've already been granted some flexibility that will enable us to make some optimizations there.

All right, so perhaps a brief follow-up regarding Oko. As for what we ought to expect in your monthly photos and the updates on your PowerPoint, what would the major key deliverables be—whether activity at the site, material being extracted from the ground, or equipment showing up on site—that we should be monitoring, or that your managers are monitoring, during construction, so that we can track it ourselves?

So you've seen a few of those monthly photos, and quite a bit of concrete has been poured for the process plant. At this point they're about to begin erecting tankage as part of the leach and CIP circuit. That's one item that will demonstrate a lot of progress. On the primary crusher, obviously, we're pouring foundation concrete for the caisson. Then obviously the assay lab is one priority for the team. We want it built so we can handle grade control on site and get quick turnarounds. That's a key priority for the construction team. Beyond that, we expect to keep receiving equipment tied now to the process plant. As we speak, our mills are on the water and being shipped to Guyana. That's one milestone that was very important to hit, and it has now been achieved.

Perfect. Thank you, and I'll pass things along now.

Appreciate it, Andrew.

Anita Soni from CIBC has the next question. Thanks.

Morning, LP and team. I just had a question about the cost guidance for next year. You raised the cost guidance for this year, but next year saw no impact. Is there a reason for that?

A portion of the bump we've recorded here, I'd say, comes from FX and the gold price. I think we'll simply hold off and watch how those metrics shift for us as the year wraps up. Basically, more than half of that $100 increase ties to FX and royalty costs under a higher gold price assumption. Yeah. We'll take a pause and see how that might affect 2027.