Safi Silver (SF) Q2 2025 earnings summary

Executive summary

• Achieved underground mining milestone of 980 tons per day for 30 consecutive days, 13 months ahead of schedule, fulfilling a key agreement with Sprott and de-risking operations.

• Processed 77,300 tons with a copper recovery rate of 92.1%; current mill capacity is 900–1,000 tons per day, with plans to expand to 60,000 tons per month.

• Strategic shift to prioritize high-grade underground ore, pausing open-pit mining to improve copper grades and profitability; commercial production from underground declared April 30, 2024.

• Announced intent to sell the Kombat Mine, including the stream and liabilities, to avoid shareholder dilution and unlock capital for new projects.

• Strategic options under review to capitalize operations and limit shareholder dilution.

Financial highlights

• Produced 2,137,159 lbs of copper at a C1 cash cost of $3.46/lb; silver production was 33,852 oz.

• Q2 revenue was $7.16 million, down from $10.03 million in the previous quarter.

• Gross profit was negative $2.2 million, with a net loss of $6.24 million, or $0.16 per share.

• Adjusted EBITDA was negative $1.4 million for the quarter.

• Cash, cash equivalents, and short-term investments totaled $909,000 at quarter end.

Outlook and guidance

• 2025 copper production guidance revised down to 8.3–9.25 million lbs, with expected grades of 1.52%–1.79%.

• Mill expansion planned to double throughput to 60,000 tonnes/month, aiming to lower costs and boost profitability.

• Full-year capital expenditures projected at $10–11 million, funding dependent.

• Proceeds from the Kombat Mine sale (estimated at $30–$50 million USD) will be used for dividends and to fund exploration at Kalahari and Addana projects.

• No further equity dilution anticipated; transaction subject to shareholder vote, with payout to follow shortly after approval.