Fortuna Mining (FVI) Q2 2024 earnings summary

Executive summary

• Q2 2024 gold equivalent production reached 116,570 oz, up 25% year-over-year, with total sales of $260 million, driven by higher gold prices and robust mine performance, especially at Séguéla.

• Net income attributable to shareholders was $43.3 million ($0.13/share), up from $3.4 million in Q2 2023; adjusted net income was $30.4 million ($0.09–$0.10/share).

• Free cash flow from operations was $38.6 million, up 306% year-over-year, and liquidity improved to $355.6 million after a $172.5 million convertible note issuance and full repayment of the $125 million revolving credit facility.

• Key capital projects advanced, including the Lindero leach pad expansion (58–64% complete) and Séguéla plant optimization, supporting future production and cost efficiency.

• Major gold discoveries at Kingfisher (Séguéla) and Diamba Sud, with Séguéla and Yaramoko achieving significant production milestones.

Financial highlights

• Adjusted EBITDA reached $112.7 million (43% margin), up from $44.4 million (28% margin) in Q2 2023.

• Operating income surged to $55.4 million from $7.7 million in Q2 2023.

• Consolidated cash cost per gold equivalent ounce was $988; AISC per gold equivalent ounce improved to $1,656, with Séguéla's cash cost at $564/oz and AISC at $1,097/oz.

• Net cash from operating activities was $73.5 million, a 66% increase over Q2 2023.

• Capital expenditures totaled $50.4 million, mainly for sustaining and non-sustaining projects, including the Séguéla royalty buyback.

Outlook and guidance

• On track to meet 2024 annual production guidance of 457,000–497,000 gold equivalent ounces and AISC of $1,485–$1,640/oz Au Eq.

• Séguéla is expected to produce 126,000–138,000 ounces of gold in 2024; Yaramoko is on track for 105,000–119,000 ounces.

• Free cash flow is expected to increase in H2 2024 as sustaining capex declines after Lindero leach pad expansion completion.

• San Jose's future is under review, with options including progressive closure, care and maintenance, or continued mining depending on exploration and resource optimization.

• Resource estimate for Diamba Sud Project expected in Q4 2024.