Ero Copper (ERO) Q1 2025 earnings summary

Executive summary

• Consolidated Q1 2025 copper production reached 12,424 tonnes and gold production was 6,638 ounces, driven by Tucumã's ramp-up and steady output at Caraíba, with $65.4 million in cash flow from operations and $63.2 million in adjusted EBITDA.

• Achieved significant progress on near-term objectives, focusing on commercial production at Tucumã (on track for H1 2025), deleveraging, advancing growth at Furnas, and preparing for shareholder returns.

• Net income attributable to owners was $80.2 million ($0.77 per diluted share), with adjusted net income at $35.8 million ($0.35/share).

• Operational improvements and contractor mobilization at Caraíba and Xavantina are expected to drive sequential growth, despite lower grades in Q1.

• Xavantina saw a 27% increase in mine/process volumes but lower gold grades; investments in equipment and infrastructure are expected to support higher production.

Financial highlights

• Q1 2025 revenues were $125.1 million, gross profit $55.5 million, adjusted EBITDA $63.2 million, and cash flow from operations $65.4 million.

• Adjusted net income for Q1 2025 was $35.8 million ($0.35/share), with available liquidity of $115.6 million at quarter-end.

• Amended credit facility increased commitments to $200 million; exercised option to increase copper prepayment facility to $75 million.

• Net debt was $561.8 million as of March 31, 2025; net debt leverage ratio at 2.4x.

• Working capital stood at $10.2 million; cash and cash equivalents were $80.6 million.

Outlook and guidance

• 2025 copper production guidance reaffirmed at 75,000–85,000 tonnes, with Caraíba and Tucumã each contributing 37.5–42.5 kt; gold production guidance is 50,000–60,000 ounces.

• Copper C1 cash cost guidance is $1.55–$1.80/lb, and gold AISC is $1,400–$1,600/oz.

• Tucumã's ramp-up expected to drive further EBITDA growth and balance sheet deleveraging; commercial production on track for H1 2025.

• Expect to begin repaying revolving credit facility in the second half of the year, assuming supportive metal prices.

• Three-year outlook projects total copper production rising to 85,000–95,000 tonnes and gold production steady at 50,000–60,000 ounces annually through 2027.