Contango Silver & Gold Inc.
For the period ended Mar 31, 2025. Filed May 14, 2025.
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A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Mar 31, 2025 · Filed May 14, 2025
CTGO$15.55+4.5%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2024-09-30; filed 2024-11-14.
0000950170-24-126724
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2025-03-31; filed 2025-05-14.
0000950170-25-071503
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 113 previous paragraphs and 101 current paragraphs.
52 unchanged; 32 reworded; 16 added; 22 removed; 7 previous and 1 current paragraphs rearranged.
Tables are not compared: 1 previous and 1 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (16)
Current report
Ability to repay indebtedness when due;
Current report
Availability and costs of material and operating equipment;
Current report
During the first quarter of 2025, the Peak Gold JV (on a 100% basis) processed 323,000 tons of ore with an average grade of 0.215 ounces (“oz”) per ton and containing approximately 69,500 oz of gold. Gold recovery averaged 93.5%, resulting in approximately 65,000 oz of recovered gold, of which Contango’s 30% share amounted to 19,500 oz of gold. During the first quarter of 2025, 17,382 ounces of gold dore were delivered to Contango and sold during the period and 3,810 ounces of gold remain in recoverable inventory as of March 31, 2025.
Current report
During the quarter ended March 31, 2025, the Company continued with ongoing work to permit the underground exploration drift and baseline environmental work. On January 15, 2025, the transportation and port easements were conveyed to CIRI by the National Parks Service and a Decision Record was issued.
Current report
On May 6, 2025, the Company announced that it had completed a Technical Report Summary ("TRS") on the Johnson Tract Project. The TRS summarizes the results of an Initial Assessment (“IA”) of the potential viability for a seven-year life of mine (“LOM”), underground mining operation, utilizing the same direct ship ore (“DSO”) approach as the Manh Choh mine. The TRS was filed on May 12, 2025.
Current report
IA HIGHLIGHTS:
Current report
Pre-Tax net present value discounted at 5% (“NPV 5”) of $359.0 million
Current report
Pre-Tax Internal Rate of Return (“IRR”) of 37.4%
Current report
Post-Tax NPV 5 of $224.5 million with a post-tax IRR of 30.2%
Current report
Seven-year LOM
Current report
LOM annual average production of 102,258 gold equivalent ounces ("GEO") at 7.58 grams per tonne ("g/t")
Current report
Initial Capital costs of $213.6 million, including $36 million for contingency costs
Current report
Sustaining Capital costs of $61.3 million, including $12.3 million for contingency costs
Current report
All-In Sustaining Costs ("AISC") estimated at $860 per GEO sold
Current report
Non-discounted payback period 1.3 years
Current report
AISC on a By-product Basis includes reclamation, sustaining capital, exploration and joint venture partner operator management costs.
Removed paragraphs (22)
Previous report
Disruption from the HighGold Acquisition and transition of HighGold’s management to the Company, including as it relates to maintenance of business and operational relationships;
Previous report
Availability of operating equipment;
Previous report
Restrictions on mining activities;
Previous report
Availability and cost of material and equipment;
Previous report
Ability to consummate strategic transactions.
Previous report
At the Johnson Tract Project the Company commenced a surface drilling campaign on July 30, 2024. The 2024 surface exploration drilling targeted 3,000 meters (approximately 9,850 ft) across 20 drill holes and was designed to in-fill the upper one-third of the near vertical resource. In parallel with the in-fill drilling, selected holes had hydrological testing and monitoring to characterize the overall surficial and deposit hydrology and water quality. In addition to assaying the core, selected drill core had advanced metallurgical, geochemical, and specific gravity tests to assist in building a geometallurgical model for the deposit. On September 9, 2024, the
Previous report
Company announced that it had completed approximately 1,500 meters (5,000 ft.) of the planned 2024 surface drilling program at the Johnson Tract Project, which remained on budget and schedule.
Previous report
On September 10, 2024,the Company received the approved “404” permit from the United States Army Core of Engineers authorizing proposed surface construction work in 2025-2029. This major permit was applied for and only covers work to establish a road form the Johnson Tract Camp to the proposed portal site and upgrades to the Johnson Tract Airfield.
Previous report
HighGold Acquisition
Previous report
On May 1, 2024, the Company entered into a definitive arrangement agreement (the “Arrangement Agreement”) by and among the Company, Contango Mining Canada Inc., a corporation organized under the laws of British Columbia and a wholly owned subsidiary of the Company, and HighGold Mining Inc., a corporation existing under the laws of the Province of British Columbia (“HighGold”), pursuant to which the Company acquired 100% of the outstanding equity interests of HighGold (the “HighGold Acquisition”) by way of a court approved plan of arrangement under the Business Corporations Act (British Columbia). The HighGold Acquisition, which was approved by HighGold shareholders at HighGold’s special meeting held on June 27, 2024, was subsequently approved by the Supreme Court of British Columbia on July 2, 2024.
Previous report
On July 10, 2024, the Company completed the HighGold Acquisition and, as contemplated by the Arrangement Agreement, each HighGold share of common stock was exchanged for 0.019 shares of Contango common stock, par value $0.01 per share (the “common stock”). HighGold options were also exchanged, directly or indirectly, for Contango shares of common stock, based on the fair market value of the HighGold options prior to the closing date. Upon closing of the HighGold Acquisition, the Company issued an aggregate of 1,698,887 shares of Contango common stock, with a value of $33.8 million, to HighGold shareholders in reliance upon an exemption from the registration requirements of the Securities Act, pursuant to Section 3(a)(10) of the Securities Act. Such exemption was based on the final order of the Supreme Court of British Columbia issued on July 2, 2024, approving the Acquisition following a hearing by the court which considered, among other things, the fairness of the Acquisition to the persons affected. Upon completion of the Acquisition, existing Contango shareholders own approximately 85.9% and HighGold shareholders own approximately 14.1% of the combined company.
Previous report
Avidian Alaska Acquisition
Previous report
On May 1, 2024, the Company entered into a stock purchase agreement with Avidian Gold Corp. (“Avidian”) pursuant to which the Company has agreed to purchase Avidian’s 100% owned Alaskan subsidiary, Avidian Gold Alaska Inc., for initial consideration of $2,400,000, with a contingent payment for up to $1,000,000 (the “Avidian Alaska Acquisition”).
Previous report
On August 6, 2024, the Company completed the Avidian Alaska Acquisition. The total purchase price of $2,063,539 consisted of (i) $400,000 in cash (the “Cash Consideration”) and (ii) $1,663,539 in shares of Contango common stock, with $207,945 of such shares withheld at closing and to be paid only upon settlement of a withholding contingency (the “Equity Consideration”). The Cash Consideration shall be paid in the following tranches: (i) a deposit of $50,000 (paid), (ii) $150,000 to be paid upon settlement of a withholding contingency and (iii) $200,000 of the Cash Consideration to be paid on or before the six-month anniversary of the transaction closing date. The number of shares of common stock constituting the Equity Consideration, which were issued or will be issued in reliance upon an exemption from the registration requirements of the Securities Act, pursuant to Section 4(a)(2) of the Securities Act, was determined based on Contango’s 10-day VWAP on the NYSE American immediately prior to the closing date.
Previous report
Underwritten Offering
Previous report
On June 10, 2024, the Company entered into an underwriting agreement with Canaccord Genuity LLC and Cormark Securities Inc. (collectively, the “June 2024 Underwriters”), relating to an underwritten public offering (the “June 2024 Offering”) of 731,750 units (the “Units”) of the Company at a price of $20.50 per Unit. Each Unit consisted of (i) one share of the Company's common stock and (ii) one-half of one accompanying warrant. Each whole accompanying warrant is exercisable to purchase one share of the Company's common stock at a price of $26.00 per warrant, exercisable for a period of 36 months. The June 2024 Underwriters agreed to purchase the Units from the Company pursuant to the June 2024 Underwriting Agreement at a price of $19.37 per Unit, which included a 5.5% underwriting discount. The net proceeds from the June 2024 Offering were $13.7 million after deducting underwriting discounts and commissions and offering expenses. The June 2024 Offering was made pursuant to the Company’s effective shelf registration statement on Form S-3. The June 2024 Offering closed on June 12, 2024.
Previous report
Critical Accounting Estimates
Previous report
The discussion and analysis of the Company’s financial condition and results of operations is based upon the consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States. The preparation of these consolidated financial statements requires the Company to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses. The Company has identified below the critical accounting estimate that is of particular importance to the portrayal of our financial position and results of operations and which require the application of significant judgment by management. Actual results may differ from these estimates under different assumptions or conditions.
Previous report
Contingent Considerations. Contingent consideration in asset acquisitions payable in the form of cash is recognized when payment becomes probable and reasonably estimable, unless the contingent consideration meets the definition of a derivative, in which case the amount becomes part of the asset acquisition cost when acquired. Contingent consideration payable in the form of a fixed number of the Company’s own shares is measured at fair value as of the acquisition date and recognized when the issuance of the shares becomes probable. Upon recognition of the contingent consideration payment, the amount is included in the cost of the acquired asset or group of assets. The Company carries a liability for contingent consideration related to the acquisition of LSA. In estimating the fair value of the contingent consideration at each reporting period, the Company makes estimates regarding the probability and timing of reaching the milestones associated with payment of the consideration, as well as the weighted average cost of capital used to discount the liability to its present value as of the balance sheet date. The estimate of the fair value of the contingent consideration is sensitive to changes in any one of these estimates.
Previous report
Derivative Instruments. The Company utilizes derivative instruments in order to manage exposure to risks associated with fluctuating commodity prices. The Company recognizes all derivatives as either assets or liabilities, measured at fair value, and recognizes changes in the fair value of derivatives in current earnings. The Company has elected to not designate any of its positions under the hedge accounting rules. Accordingly, these derivative contracts are mark-to-market and any changes in the estimated values of derivative contracts held at the balance sheet date are recognized in unrealized (loss) gain on derivative contracts, net in the Condensed Consolidated Statements of Operations as unrealized gains or losses on derivative contracts. Realized gains or losses on derivative contracts will be recognized in (Loss) gain on derivative contracts, net in the Condensed Consolidated Statements of Operations.
Previous report
Nine Months Ended September 30, 2024 Compared to Nine Months Ended September 30, 2023
Previous report
Loss on Derivative Contracts. Loss on derivative contracts for the nine months ended September 30, 2024 was $57.0 million compared to $2.7 million for the nine months ended September 30, 2023. The $57.0 million loss for the nine month period of September 30, 2024 included a realized loss of $5.9 million as the Company delivered 14,826 gold ounces into the derivative contracts. The loss also included a non-cash unrealized loss of $51.1 million. The Company did not deliver gold ounces into the derivative contracts for the nine month period ended September 30, 2023. Therefore, there was no realized loss for the period and the $2.7 million was a non-cash unrealized loss. The Company did not enter into any derivative contracts until July 2023 (see Note 14 - Derivative and Hedging Activities).
Reworded paragraphs (32)
Previous wording
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the consolidated financial statements and the accompanying notes and other information included elsewhere in this Form 10-Q and our Form 10-KT for the six-month period ended December 31, 2023 and Form 10-K for the fiscal year ended June 30, 2023, previously filed with the SEC.
Current wording
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the consolidated financial statements and the accompanying notes and other information included in our Form 10-K for the year ended December 31, 2024, previously filed with the SEC.
Previous wording
The Company’s ability to fund its business with current cash reserves based on currently planned activities;
Current wording
The Company’s ability to fund its business with cash flows from operations and current cash reserves;
Previous wording
Although the Company believes the expectations reflected in such forward-looking statements are reasonable, such expectations may not occur. These forward-looking statements involve known and unknown risks, uncertainties and other factors, many of which are outside of our control, that may cause our actual results, performance or achievements to be materially different from future results expressed or implied by the forward-looking statements. In addition to the risk factors described in Part II, Item 1A. Risk Factors, of this Form 10-Q and Part I, Item 1A. Risk Factors, in our Transition Report on Form 10-KT for the six-month period ended December 31, 2023, these factors include among others:
Current wording
Although the Company believes the expectations reflected in such forward-looking statements are reasonable, such expectations may not occur. These forward-looking statements involve known and unknown risks, uncertainties and other factors, many of which are outside of our control, that may cause our actual results, performance or achievements to be materially different from future results expressed or implied by the forward-looking statements. In addition to the risk factors described in Part II, Item 1A. Risk Factors, of this Form 10-Q and Part I, Item 1A. Risk Factors, in our Annual Report on Form 10-K for the year ended December 31, 2024, these factors include among others:
Previous wording
Ability to raise capital to fund capital expenditures and repayment of indebtedness;
Current wording
Availability and ability to raise capital to fund capital expenditures;
Previous wording
Ability to realize the anticipated benefits of the HighGold Acquisition;
Current wording
Ability to consummate and realize the anticipated benefits of strategic transactions;
Previous wording
Federal and state legislation and regulation that affects mining development and activities;
Current wording
Federal and state legislation and regulation that affects or restricts mining development and activities;
Previous wording
Impact of new and potential legislative and mining operating and safety standards;
Current wording
Impact of new and potential mining operating and safety standards;
Previous wording
Ability to obtain insurance coverage on commercially reasonable terms;
Current wording
Ability to obtain insurance coverage on commercially reasonable terms; and
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Risks related to title to properties; and
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Risks related to title to properties.
Previous wording
Third Quarter 2024 Highlights and Recent Developments
Current wording
First Quarter 2025 Highlights and Recent Developments
Previous wording
In July 2024, the Peak Gold JV commenced processing of the ore at the Fort Knox facility and on July 8, 2024, Manh Choh Project achieved a significant milestone and poured its first gold bar, on schedule. On September 9, 2024, the Company announced the start of a second campaign of gold production from the Manh Choh Project. On September 17, 2024, the Company announced the receipt of a $19.5 million cash distribution from the Peak Gold JV relating to production at Manh Choh. During the third quarter of 2024, ore transportation has ramped up to planned volumes, with full commissioning of modifications at the Fort Knox facility having been completed. The Manh Choh Project remains on track to deliver its planned production this year. The Peak Gold JV management committee approved budgets for 2023 and 2024, with cash calls totaling approximately to $248.1 million, of which the Company’s share was approximately $74.5 million. In July 2024, the Company had to contribute an unbudgeted additional cash call for $4.1 million. As of September 30, 2024, the Company has funded $78.6 million towards the cash calls.
Current wording
In July 2024, the Peak Gold JV commenced processing ore at the Fort Knox facility and on July 8, 2024, the Manh Choh Project achieved a significant milestone and poured its first gold bar, on schedule. In 2024, the Company received $40.5 million in cash distributions from the Peak Gold JV relating to production at Manh Choh, followed by $24.0 million received in the first quarter of 2025 and an additional $9 million received subsequent to quarter-end.
Previous wording
The Lucky Shot project remains in care and maintenance as the Company plans a surface and underground drilling program for 2025.
Current wording
The Lucky Shot project remains in care and maintenance.
Previous wording
Alaska Department of Transportation and Public Facilities ("DOT"). The Complaint seeks injunctive relief against the DOT with respect to its oversight of Peak Gold's ore haul plan. The Complaint alleges that the DOT has approved a haul route and trucking plan that violates DOT regulations, DOT's actions have created an unreasonable risk to public safety constituting an attractive public nuisance, and DOT has aided and abetted the offense of negligent driving. On November 2, 2023, the plaintiff filed a motion for a preliminary injunction against the DOT and sought expedited consideration of its motion. If granted, the motion could impact Peak Gold's ore haul plans. On November 9, 2023, the Court denied the plaintiff's motion for expedited consideration. On November 15, 2023, the Court granted Peak Gold, LLC's motion to intervene. On January 15, 2024, Peak Gold and DOT jointly moved for judgment on the pleadings and to stay all discovery. On May 14, 2024, the Court issued an Order denying the plaintiff's motion for preliminary injunction and staying discovery. On June 24, 2024, the Court issued an Order granting judgment on the pleadings as to three of the four claims for relief alleged in the Complaint and denying relief as to the claim for public nuisance. The Order further lifted the stay of discovery. On July 3, 2024, the DOT filed motion for reconsideration as to the Court's Order on the motion for judgment on the pleadings, which Peak Gold joined. On September 13, 2024, the Court entered an Order denying this motion. The case is set for trial on August 11, 2025.
Current wording
On October 20, 2023, the Committee for Safe Communities, an Alaskan non-profit corporation inclusive of this same group of objectors and formed for the purpose of opposing the project, filed suit in the Superior Court in Fairbanks, Alaska against the State of Alaska Department of Transportation and Public Facilities ("DOT"). The Complaint seeks injunctive relief against the DOT with respect to its oversight of the Peak Gold JV's ore haul plan. The Complaint alleges that the DOT has approved a haul route and trucking plan that violates DOT regulations, DOT's actions have created an unreasonable risk to public safety constituting an attractive public nuisance, and DOT has aided and abetted the offense of negligent driving. On November 2, 2023, the plaintiff filed a motion for a preliminary injunction against the DOT and sought expedited consideration of its motion. If granted, the motion could impact the Peak Gold JV's ore haul plans. On November 9, 2023, the Court denied the plaintiff's motion for expedited consideration. On November 15, 2023, the Court granted the Peak Gold JV's motion to intervene. On January 15, 2024, the Peak Gold JV and DOT jointly moved for judgment on the pleadings and to stay all discovery. On May 14, 2024, the Court issued an Order denying the plaintiff's motion for preliminary injunction and staying discovery. On June 24, 2024, the Court issued an Order granting judgment on the pleadings as to three of the four claims for relief alleged in the Complaint and denying relief as to the claim for public nuisance. The Order further lifted the stay of discovery. On July 3, 2024, the DOT filed motion for reconsideration as to the Court's Order on the motion for judgment on the pleadings, which the Peak Gold JV joined. On September 13, 2024, the Court entered an Order denying this motion. On May 6, 2025, the plaintiff and the DOT agreed to dismiss without prejudice the only remaining claim for relief alleged in the Complaint. All claims in the matter were dismissed and the trial, which was set for August 11, 2025, and all pretrial deadlines were vacated by the Court.
Previous wording
On July 1, 2024, the Village of Dot Lake, a federally recognized Indian Tribe, located approximately 50 miles from the Manh Choh mine on the ore haul route along the Alaska Highway ("Dot Lake"), filed a Complaint in the U.S. District Court for the District of Alaska against U.S. Army Corps of Engineers (the "Corps") and Lt. General Scott A. Spellmon, in his official capacity as Chief of Engineers and Commanding General of the Corps. The Complaint seeks declaratory and injunctive relief based on the Corps' alleged failure to consult with Dot Lake and to undertake an adequate environmental review with respect to the Corps' issuance in September 2022 of a wetlands disturbance permit in connection with the overall permitting of the Manh Choh mine as to approximately 5 acres of wetlands located on Tetlin Village land. Peak Gold is not named as a defendant in the Complaint and, on August 20, 2024, Peak Gold moved to intervene in the action, which Dot Lake has opposed. On October 10, 2024, the Court granted intervention to Peak Gold.
Current wording
On July 1, 2024, the Village of Dot Lake, a federally recognized Indian Tribe, located approximately 50 miles from the Manh Choh mine on the ore haul route along the Alaska Highway ("Dot Lake"), filed a Complaint in the U.S. District Court for the District of Alaska against U.S. Army Corps of Engineers (the "Corps") and Lt. General Scott A. Spellmon, in his official capacity as Chief of Engineers and Commanding General of the Corps. The Complaint seeks declaratory and injunctive relief based on the Corps' alleged failure to consult with Dot Lake and to undertake an adequate environmental review with respect to the Corps' issuance in September 2022 of a wetlands disturbance permit in connection with the overall permitting of the Manh Choh mine as to approximately 5 acres of wetlands located on Tetlin Village land. The Peak Gold JV is not named as a defendant in the Complaint and, on August 20, 2024, the Peak Gold JV moved to intervene in the action, which Dot Lake opposed. On October 10, 2024, the Court granted intervention to the Peak Gold JV. On October 18, 2024, the Peak Gold JV joined the partial motion to dismiss that the Corps filed on August 23, 2024, which motion remains pending. On March 19, 2025, the Court entered an Order on Motion to Partially Dismiss, which Order dismissed three of the four claims asserted in the Complaint. On April 1, 2025, Dot Lake filed an Amended Complaint which seeks to reassert one of the claims that was dismissed without prejudice. On May 2, 2025, the Peak Gold JV moved to dismiss this reasserted claim, which motion remains pending.
Previous wording
Claim Rentals Expense. Claim rental expense primarily consists of State of Alaska rental payments and costs incurred to record annual labor documents. For the three months ended September 30, 2024 and 2023, claim rental expense were $0.2 million and $0.1 million respectively.
Current wording
Claim Rentals Expense. Claim rental expense primarily consists of State of Alaska rental payments and costs incurred to record annual labor documents. For the three months ended March 31, 2025 and 2024, claim rental expense were $0.1 million and $0.1 million respectively.
Previous wording
Exploration Expense. Exploration expense for the three months ended September 30, 2024 was $3.0 million compared to $1.1 million for the three months ended September 30, 2023. Current period exploration expense primarily relates to a 3,000 meter surface drill program at the Johnson Tract Project. The prior period exploration expense relates to care and maintenance work performed on the Lucky Shot Property.
Current wording
Exploration Expense. Exploration expense for the three months ended March 31, 2025 was $0.5 million compared to $0.1 million for the three months ended March 31, 2024. Current period exploration expense primarily relates to the permitting process for the underground exploration drift and baseline environmental work at the Johnson Tract Project, which are part of the IA. The prior period exploration expense relates to care and maintenance work performed on the Lucky Shot Property.
Previous wording
General and Administrative Expense. General and administrative expense for the three months ended September 30, 2024 and 2023 was $2.6 million and $2.8 million, respectively. The Company’s general and administrative expense primarily relates to legal fees, regulatory fees, payroll and stock-based compensation expense.
Current wording
General and Administrative Expense. General and administrative expense for the three months ended March 31, 2025 and 2024 was $2.4 million and $2.5 million, respectively. The Company’s general and administrative expense primarily relates to legal fees, regulatory fees, payroll and stock-based compensation expense.
Previous wording
Income / Loss from Equity Investment in the Peak Gold JV. The income from the Company’s equity investment in the Peak Gold JV for the three months ended September 30, 2024 was $28.5 million compared to a loss of $5.6 million for the same period in 2023. The Manh Choh project commenced production in July 2024, which generated income for the 2024 period. The capital contributions for the three months ended September 30, 2024 and 2023 were $4.0 million and $27.0 million, respectively. The capital contributions were higher for three months ended September 30, 2023 compared to September 30, 2024 as the Manh Choh project was in the development phase in 2023 and required capital for mine development and improvements as the Fort Knox mill facility. The Peak Gold JV issued a cash distribution of $19.5 million during the three month period ended September 30, 2024. No cash distributions were made for the same period in 2023. There were no suspended losses as of September 30, 2024.
Current wording
Income / Loss from Equity Investment in the Peak Gold JV. The income from the Company’s equity investment in the Peak Gold JV for the three months ended March 31, 2025 was $22.3 million compared to a loss of $0.1 million for the same period in 2024. The Manh Choh Project commenced production in July 2024, which generated income for the second half of 2024. The capital contributions for the three months ended March 31, 2025 and 2024 were nil and $15.5 million, respectively. The capital contributions were higher for three months ended March 31, 2024 compared to March 31, 2025 as the Manh Choh Project was in the development stage in early 2024 and required capital for mine development and improvements as the Fort Knox mill facility. The Peak Gold JV issued a cash distribution of $24 million during the three month period ended March 31, 2025. No cash distributions were made during the same period in 2024. There were no suspended losses as of March 31, 2025. As of March 31, 2025, accounts payable includes $7.7 million owed to Peak Gold JV.
Previous wording
Interest Expense. For the three months ended September 30, 2024 interest expense was $3.7 million related to the Queen's Road Capital Investment, Ltd. Debenture (the "Debenture") and interest expense related to the Company’s cumulative $58.0 million draw-down on the Facility. Prior year interest expense of $1.0 million included interest expense related to the Debenture and interest expense related to the Company's cumulative $20 million draw-down on the Facility. See Note 13 - Debt.
Current wording
Interest Expense. For the three months ended March 31, 2025, interest expense was $2.7 million and primarily related to the Queen's Road Capital Investment, Ltd. Debenture (the "Debenture") and interest expense related to the Company’s cumulative $38.3 million draw-down on the Facility. Prior year interest expense of $2.0 million included interest expense related to the Debenture and interest expense related to the Company's cumulative $42.5 million draw-down on the Facility. See Note 13 - Debt.
Previous wording
Metal Sales. For the three months ended September 30, 2024, the gain on metal sales was $0.9 million related to excess ounces that were purchased from the Peak Gold JV that were not delivered into the hedges and sold to the derivative counterparties. There were no metal sales for the three months ended September 30, 2023.
Current wording
Metal Sales. For the three months ended March 31, 2025, the gain on metal sales was $1.2 million and related to excess ounces that were purchased from the Peak Gold JV that were not delivered into the hedges and sold to the derivative counterparties. There were no metal sales for the three months ended March 31, 2024.
Previous wording
Loss on Derivative Contracts. Loss on derivative contracts for the three months ended September 30, 2024 was $28.8 million compared to $2.7 million for the three months ended September 30, 2023. The $28.8 million loss for the three month period of September 30, 2024 included a realized loss of $5.9 million as the Company delivered 14,826 gold ounces into the derivative contracts. The loss also included a non-cash unrealized loss of $22.9 million. The Company did not deliver gold ounces into the derivative contracts for the three month period ended September 30, 2023. Therefore, there was no realized loss for the period and the $2.7 million was a non-cash unrealized loss. The Company did not enter into any derivative contracts until July 2023 (see Note 14 - Derivative and Hedging Activities).
Current wording
Loss on Derivative Contracts. Loss on derivative contracts for the three months ended March 31, 2025 was $40.5 million compared to $15.6 million for the three months ended March 31, 2024. The Company did not deliver gold ounces into the derivative contracts for the three-month period ended March 31, 2025 and 2024. Therefore, there was no realized loss for the periods and the $40.5 million and $15.6 million was a non-cash unrealized loss, respectively. (see Note 14 - Derivative and Hedging Activities).
Previous wording
Cash Cost on a By-Product Basis (non-GAAP Measure)
Current wording
Cash Cost on a By-Product Basis and All-In Sustaining Costs on a By-Product Basis (non-GAAP)
Previous wording
The table below presents a reconciliation between the most comparable GAAP measure of total cost of sales to the non-GAAP measures of Cash Cost on a By-product Basis for the Peak Gold JV operations (Manh Choh) for the nine months ended September 30, 2024. There are no comparables provided as sales of gold at Manh Choh commenced in July 2024.
Current wording
The table below presents reconciliations between the most comparable GAAP measure of total cost of sales to the non-GAAP measures of (i) Cash Cost on a By-product Basis and (ii) AISC on a By-product Basis for the Peak Gold JV operations (Manh Choh) for the three months ended March 31, 2025. No comparable period is provided as sales of gold at Manh Choh commenced in July 2024.
Previous wording
Cash Cost on a By-product Basis, per Ounce is a measure developed by precious metals companies (including the Silver Institute and the World Gold Council) in an effort to provide a uniform standard for comparison purposes. There can be no assurance, however, that this non-GAAP measure as we report is the same as that reported by other mining companies.
Current wording
Cash Cost on a By-product Basis, per Ounce and AISC on a By-product Basis, per Ounce are measures developed by precious metals companies (including the Silver Institute and the World Gold Council) in an effort to provide a uniform standard for comparison purposes. There can be no assurance, however, that these non-GAAP measures as we report them are the same as those reported by other mining companies.
Previous wording
Cash Cost on a By-product Basis, per Ounce is an important operating statistic that the Company will utilize to measure a mine's operating performance. Cash Cost on a By-product Basis, per Ounce allows us to benchmark the performance of the Peak Gold JV versus those of our competitors. This statistic is useful in identifying acquisition and investment opportunities as they provide a common tool for measuring the financial performance of other mines with varying geologic, metallurgical and operating characteristics.
Current wording
Cash Cost on a By-product Basis, per Ounce is an important operating statistic that we utilize to measure a mine's operating performance. We use AISC on a By-product Basis, per Ounce as a measure of a mine's net cash flow after costs for reclamation and sustaining capital. This is similar to the Cash Cost on a By-product Basis, per Ounce measure we report, but also includes reclamation and sustaining capital costs. Current GAAP measures used in the mining industry, such as cost of goods sold, do not capture all the expenditures incurred to discover, develop and sustain gold production. Cash Cost on a By-product Basis, per Ounce and AISC on a By-product Basis, per Ounce also allow us to benchmark the performance of the Peak Gold JV versus those of our competitors. These statistics are useful in identifying acquisition and investment opportunities as they provide a common tool for measuring the financial performance of other mines with varying geologic, metallurgical and operating characteristics.
Previous wording
Cash Costs on a By-product Basis, per Ounce is calculated by adjusting production cost of sales, as reported on the interim condensed consolidated statements of operations, as follows:
Current wording
Cash Costs on a By-product Basis, per Ounce and AISC on a By-product Basis, per Ounce are calculated by adjusting production cost of sales, as reported on the interim condensed consolidated statements of operations, as follows:
Previous wording
As of September 30, 2024, the Company had approximately $36.2 million of cash.
Current wording
As of March 31, 2025, the Company had approximately $35.2 million of cash.
Previous wording
The Company’s primary cash requirements have been for general and administrative expenses, capital calls from the Peak Gold JV for the Manh Choh Property, repayment of interest related to debt and exploration expenditures on the Johnson Tract Project and Lucky Shot Property. The Company’s sources of cash have been from common stock offerings, the issuance of the Debenture, distributions from the equity investment and the proceeds from the Facility (see Note 8 - Stockholders' Equity (Deficit) and Note 13 - Debt, for a discussion of the recent activity).
Current wording
The Company’s primary cash requirements have been for general and administrative expenses, capital calls from the Peak Gold JV for the Manh Choh Property, repayment of principal and interest related to debt and exploration expenditures on the Johnson Tract Project and Lucky Shot Property. The Company’s sources of cash have been from common stock offerings, the issuance of the Debenture, distributions from the equity investment and the proceeds from the Facility (see Note 5 - Investment in the Peak Gold JV, Note 8 - Stockholders' Equity (Deficit) and Note 13 - Debt, for a discussion of the recent activity).
Previous wording
The JV Management Committee approved a significant budget to complete the required development to start the operations of the Manh Choh mine, which began production early in the third quarter of 2024 and remains on track to deliver its planned production this year. On July 8, 2024, the Peak Gold JV poured its first gold bar. The ore mining continues along with stockpiling ore at the Fort Knox facility. The Project is on schedule and full commissioning of the modifications at the Fort Knox mill was completed. As of September 30, 2024, the Company has funded $78.6 million of the fiscal 2023 and 2024 capital calls to the Peak Gold JV, $31.3 million of which was required in fiscal 2024 for the Peak Gold JV to reach production. $60.0 million of such amount was funded from the Facility. Operations commenced in July 2024 which has allowed the Peak Gold JV to operate from the cash flows generated from its operations and there are no future anticipated cash calls. If there are any unforeseen cash calls and if the Company elects to not fund a portion of its cashl calls to the Peak Gold JV, its membership interest in the Peak Gold JV would be diluted.
Current wording
The Manh Choh Project began production early in the third quarter of 2024 and on July 8, 2024, the Peak Gold JV poured its first gold bar. The Manh Choh Project remains on schedule and ore mining continues along with stockpiling of ore at the Fort Knox facility.
Previous wording
The Company’s cash needs going forward will primarily relate to exploration of the Contango Properties, repayment of debt and related interest and general and administrative expenses of the Company. Although there can be no guarantee that the Peak Gold JV will make distributions to the Company, the Company believes that distributions are probable and that it will maintain sufficient liquidity to meet its working capital requirements, including repayment obligations of approximately $34.9 million on the Facility, for the next twelve months from the date of this report. Failure to pay current debt obligations will result in an event of default and the Company's debt would be due immediately or callable (See Note 13).
Current wording
The Company’s cash needs going forward will primarily relate to exploration of the Contango Properties, repayment of debt and related interest and general and administrative expenses of the Company. In the third and fourth quarters of 2024, the Company received cash distributions from the Peak Gold JV relating to production at Manh Choh of $19.5 million and $21.0 million. In the first quarter of 2025, the Company received cash distributions totaling $24.0 million. Although there can be no guarantee that the Peak Gold JV will continue to make distributions to the Company, the Company believes that distributions are probable and that it will maintain sufficient liquidity to meet its working capital requirements, including repayment obligations of approximately $24.7 million on the Facility, for the next twelve months from the date of this report. The Company made a repayment of $13.8 million on the Facility in January 2025.
Previous wording
Further financing by the Company may include issuances of equity, instruments convertible into equity (such as warrants) or various forms of debt. The Company has issued common stock and other instruments convertible into equity in the past and cannot predict the size or price of any future issuances of common stock or other instruments convertible into equity, and the effect, if any, that such future issuances and sales will have on the market price of the Company’s securities. Any additional issuances of common stock or securities convertible into, or exercisable or exchangeable for, common stock may ultimately result in dilution to the holders of common stock, dilution in any future earnings per share of the Company and may have a material adverse effect upon the market price of the common stock of the Company.
Current wording
Further financing by the Company may include issuances of equity, instruments convertible into equity (such as warrants) or various forms of debt. The Company has issued common stock and other instruments convertible into equity in the past and cannot predict the size or price of any future issuances of common stock or other instruments convertible into equity, and the effect, if any, that such future issuances and sales will have on the market price of the Company’s securities.
Previous wording
General information about the Company can be found on the Company’s website at www.contangoore.com. Our annual reports on Form 10-K, transition report on Form 10-KT, quarterly reports on Form 10-Q and current reports on Form 8-K, as well as any amendments and exhibits to those reports, are available free of charge through our website as soon as reasonably practicable after the Company files or furnishes them to the SEC.
Current wording
General information about the Company can be found on the Company’s website at www.contangoore.com. Our annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K, as well as any amendments and exhibits to those reports, are available free of charge through our website as soon as reasonably practicable after the Company files or furnishes them to the SEC.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Production from the Manh Choh Project has allowed the Peak Gold JV to operate from the cash flows generated from its operations and there are no future anticipated cash calls.
Rearranged previous paragraphs (7)
Previous report — wording carried elsewhere
On October 20, 2023, the Committee for Safe Communities, an Alaskan non-profit corporation inclusive of this same group of objectors and formed for the purpose of opposing the project, filed suit in the Superior Court in Fairbanks, Alaska against the State of
Previous report — wording carried elsewhere
Claim Rentals Expense. Claim rental expense primarily consists of State of Alaska rental payments and costs incurred to record annual labor documents. For the nine months ended September 30, 2024 and 2023, claim rental expense was $0.4 million and $0.4 million respectively.
Previous report — wording carried elsewhere
Exploration Expense. Exploration expense for the nine months ended September 30, 2024 was $3.1 million compared to $2.3 million for the nine months ended September 30, 2023. Current period exploration expense primarily relates to a 3,000 meter surface drill program at the Johnson Tract Project. The prior period exploration expense relates to care and maintenance work performed on our Lucky Shot Property.
Previous report — wording carried elsewhere
General and Administrative Expense. General and administrative expense for the nine months ended September 30, 2024 and 2023 was $7.3 million and $7.3 million, respectively. The Company’s general and administrative expense primarily relates to legal fees, regulatory fees, payroll and stock-based compensation expense.
Previous report — wording carried elsewhere
Income / Loss from Equity Investment in the Peak Gold JV. The income from the Company’s equity investment in the Peak Gold JV for the nine months ended September 30, 2024 was $27.7 million compared to a loss of $17.4 million for the same period in 2023. The Manh Choh project commenced production in July 2024, which generated income for the 2024 period. The capital contributions for the nine months ended September 30, 2024 and 2023 were $31.2 million and $38.8 million, respectively. The capital contributions were higher for nine months ended September 30, 2023 compared to September 30, 2024 as operations were ramping up at the Manh Choh project with ore and waste mining and a focus on capital improvements at the Fort Knox mill facility. The Peak Gold JV issued a cash distribution of $19.5 million for the nine month period ended September 30, 2024. No cash distributions were made for the same period in 2023. There were no suspended losses as of September 30, 2024.
Previous report — wording carried elsewhere
Interest Expense. For the nine months ended September 30, 2024 interest expense was $8.6 million related to the Debenture and interest expense related to the Company’s cumulative $58.0 million draw-down on the Facility. Prior year interest expense of $1.9 million included interest expense related to the Debenture and interest expense related to the Company's cumulative $20 million draw-down on the Facility. See Note 13 - Debt.
Previous report — wording carried elsewhere
Metal Sales. For the nine months ended September 30, 2024, the gain on metal sales was $0.9 million related to excess ounces that were purchased from the Peak Gold JV that were not delivered into the hedges and sold to the derivative counterparties. There were no metal sales for the nine months ended September 30, 2023.