Hudbay Minerals Inc.

RECENT DEVELOPMENTS

Continued Free Cash Flow Generation from Strong Copper and Gold Exposure

Hudbay has delivered eight consecutive quarters of meaningful free cash flow 1 generation as a result of steady operating performance, expanding margins from strong copper and gold exposure and a focus on cost control across the business:

• Achieved record trailing twelve-month adjusted EBITDA 1 of $995.9 million.

• Delivered more than $400 million in annual free cash flow 1 generation over the last twelve months.

• Increased cash and cash equivalents balance to $625.5 million, the highest level achieved in more than a decade.

• Gold continues to represent more than 36% of total revenues, which together with Hudbay's primary copper revenue business provides unique copper and gold commodity diversification.

Significant Debt Reduction

As a result of the continued free cash flow 1 generation and prudent balance sheet management, Hudbay was able to repurchase and retire $50.0 million of senior unsecured notes at a discount to par, during the second quarter of 2025. This has contributed to approximately $295 million in total debt repayments and gold prepayment liability reductions since the beginning of 2024:

• Repurchased and retired a total of $132.6 million of senior unsecured notes in 2024 and year-to-date 2025.

• Repaid $100 million of prior drawdowns under the revolving credit facilities in 2024.

• Fully repaid the gold prepay facility with $62.3 million in gold deliveries in 2024 and the final payment completed in August 2024.

These deleveraging achievements have reduced total principal debt to $1.07 billion as of June 30, 2025, which together with Hudbay's increased cash balance, has substantially reduced net debt 1 to $434.1 million, compared to $631.8 million as of June 30, 2024. Incorporating higher levels of adjusted EBITDA 1 over the last twelve months, Hudbay's net debt to adjusted EBITDA ratio 1 has significantly improved to 0.4x.

Secured Premier Long-term Strategic Partner in Copper World JV Transaction

The joint venture will be structured as a new limited liability corporation, Copper World LLC. Under the JV Transaction, the initial contribution of $600 million for a 30% equity interest in Copper World LLC, will consist of $420 million upon closing and a $180 million matching contribution payable no later than 18 months following closing. Hudbay will retain 100% of its existing U.S. federal net operating losses of approximately $275 million and Arizona state losses of $210 million.

Hudbay welcomes a premier, long-term, strategic partner with deep technical expertise and a proven trading platform which Mitsubishi has established throughout its demonstrated history of industry partnerships. Mitsubishi's impressive track record in co-developing and operating some of the world's largest and highest quality copper projects will complement Hudbay's proven track record as a successful mine builder and operator.

Mitsubishi will be contributing 30% of the ongoing costs beginning August 31, 2025 and will participate in the funding of the DFS as well as the final project design, project financing, and project construction for Copper World.

The JV Transaction is expected to close in late 2025 or early 2026 and is conditioned upon receipt of certain regulatory approvals and the satisfaction of other customary closing conditions.

Enhanced Wheaton Precious Metals Stream

Hudbay is also pleased to announce that it has concurrently executed a non-binding term sheet to amend its existing Wheaton stream agreement for 100% of the gold and silver produced at Copper World (the "Wheaton Stream"), which will increase the value of the project and provide upside exposure to higher precious metal prices.

Key terms of this enhanced Wheaton Stream to include (subject to execution of definitive documentation):

• Up to $70 million contingent payment upon achieving potential mill expansion milestones in the future recognizing the long-term potential at Copper World.

• Amended ongoing payments for gold and silver from a fixed price to 15% of spot gold and silver prices providing upside exposure to higher precious metals prices.

• Initial $230 million stream deposit during project construction remains unchanged.

• Hudbay agreed to maintain existing fixed recoveries in the existing Constancia precious metals stream while Pampacancha is in production as well as provided a corporate guarantee for the existing Constancia stream in connection with the Wheaton Stream enhancement.

"Successfully Completed "3-P" Plan for Advancing Copper World Towards a Sanction Decision in 2026

As part of Hudbay's disciplined financial planning approach to developing Copper World, the Company implemented its 3-P plan in late 2022, including specific leverage targets that it would need to achieve prior to making an investment decision in the project:

1. Permits -* Completed ***- Hudbay received all required state level permits.

2. Plan** **- Well Underway - Hudbay commenced activities related to the feasibility study for Copper World in late 2024 and expects to continue to advance definitive feasibility study activities throughout 2025 with completion by mid-2026.

3. Prudent Financing Strategy** -* Completed ***- Hudbay achieved all key elements of its multi-faceted financing strategy, including:

✓ Minimum cash balance of $600 million- As of June 30, 2025, Hudbay has over $625 million in cash and cash equivalents;

✓ Net debt to EBITDA ratio of less than 1.2x- As of June 30, 2025, Hudbay's net debt to adjusted EBITDA ratio 1 is 0.4x, meaningfully below the targeted ratio to ensure financial flexibility during the sanctioning and construction of Copper World;

✓ Renegotiated precious metals stream agreement - Announced an enhanced Wheaton Stream that aligns with the current development plan for Copper World, reflects amended ongoing payments for gold and silver deliveries from a fixed pricing to 15% of spot prices to provide upside exposure to higher precious metals prices, while also providing additional contingent payments of up to $70 million related to potential future mill expansion milestones; and,

✓ *Minority joint venture partner *- Announced a $600 million transaction with Mitsubishi for a 30% minority joint venture interest in a highly accretive transaction, which creates a long-term partnership with a premier strategic partner that has a global mining presence and an established U.S. based metals trading business.

As a result of the completion of the prudent financing strategy, Hudbay's estimated share of the remaining capital contributions for the construction of Copper World is approximately $200 million 2, and Hudbay's first capital contribution is deferred until 2028 at the earliest based on PFS estimates. Based on Hudbay's pro-forma cash and cash equivalents of more than $1.0 billion and total liquidity of more than $1.5 billion, using figures as at June 30, 2025, the Company has significant financial flexibility to fund its share of the remaining equity contributions at Copper World while continuing to maintain a strong balance sheet throughout the project construction period.

Manitoba Temporary Wildfire Evacuation Orders

Since the end of May, seasonal wildfires in northern Manitoba have resulted in evacuation orders in the regions where Hudbay operates. Emergency preparedness protocols were immediately activated and Hudbay has continued to work closely with local and provincial authorities to ensure the safety and well-being of its employees and nearby communities. The first mandatory wildfire evacuation orders resulted in Hudbay temporarily suspending operations in June for 13 days and operating with a reduced workforce since the end of May, before and after the operation suspension. The Company committed over C$2 million in funding support in June, including C$1.6 million in direct financial support for evacuated Hudbay employees and a C$500,000 donation to the Canadian Red Cross to support wildfire emergency relief and rebuilding efforts in northern Manitoba. The Company's Canadian Red Cross donation was part of a collective C$1.25 million donation that was made by the three leading mining companies that operate in Manitoba, including Hudbay, Vale Base Metals and Alamos Gold Inc. In addition, Hudbay established a Community Relief Donations Fund whereby Hudbay doubled the amounts donated by its employees to the Canadian Red Cross, further multiplying the support for emergency response efforts in the region.

Hudbay's Manitoba team continues to show remarkable resilience as demonstrated by the tremendous effort and unwavering commitment during this unprecedented wildfire season. They have tirelessly safeguarded the Company's assets and collaborated closely with local communities and provincial authorities, providing essential support to emergency response efforts.

On July 10, 2025, a second mandatory wildfire evacuation order was issued for the town of Snow Lake and a controlled, safe and orderly temporary suspension of the Snow Lake operations was implemented. As of August 12, 2025, the wildfire situation near Snow Lake has improved and Hudbay anticipates returning to normal operations later in August. The Company continues to expect to achieve its 2025 annual guidance metrics for all metals in Manitoba, despite the temporary wildfire impacts.

British Columbia Mill Optimization Project Achieves Key Milestone

In July, shortly following the end of the second quarter, Hudbay reached a significant milestone on the Copper Mountain mill optimization project to convert the third ball mill to a second SAG mill. The mill project is intended to increase nominal processing capacity to its permitted capacity of 50,000 tonnes per day starting in 2026.

The initial phase of the project achieved first ore production on July 10, a key milestone to ramp up mill capacity. The first phase was completed on time with more than 41,000 hours worked and zero lost-time incidents, which is a testament to the dedication and safety culture of Hudbay's team. The project remains on budget as it moves into the final phase of the project, which includes converting an interim feed arrangement to a permanent configuration and remains on track for completion in the second half of 2025.

New Ingerbelle Permit Application Achieves Key Milestone

On May 12, 2025, Hudbay's permitting application for the New Ingerbelle growth project at Copper Mountain was successfully accepted into review by the B.C. Major Mines Office and is now proceeding through a Mine Review Committee process. The Copper Mountain team continues ongoing engagement with First Nations and other local stakeholder groups as part of the Company's commitment to cultivating transparency and mutually beneficial relationships.

Exploration Update

Large Snow Lake Exploration Program Continues to Execute Threefold Strategy

Hudbay continues to execute the largest exploration program in Snow Lake in the Company's history through extensive geophysical surveying and multi-phased drilling campaigns as part of Hudbay's threefold exploration strategy:

• **Near-mine exploration at Lalor and 1901 further increase near-term production and extend mine life -**Following the positive initial step-out drilling from the exploration drift at the 1901 deposit earlier this year, Hudbay completed the development of the drift in the second quarter of 2025, and in June, the first zinc-rich ore from the 1901 mining area was delivered for processing at Stall. Activities at 1901 over the next two years will prioritize exploration, definition drilling, orebody access, and establishing critical infrastructure for full production in 2027. The additional exploration at 1901 planned for later in 2025 will target additional step-out drill holes to potentially extend the ore body and infill drilling to convert inferred mineral resources in the gold lenses to mineral reserves. The Company also expects to continue drilling down plunge of lenses 27 and 17 at Lalor once wildfire conditions improve.

• Testing regional satellite deposits to utilize available processing capacity and increase production - Hudbay increased its regional land package by more than 250% in 2023 through the acquisition of Rockcliff Metals Corp., which included the addition of several known deposits located within trucking distance of the Snow Lake processing infrastructure. The deposits acquired as part of the Rockcliff Metals Corp. acquisition, together with several deposits already owned by Hudbay in Snow Lake, have created an attractive portfolio of regional deposits in Snow Lake, including the Talbot, Rail, Pen II, Watts, 3 Zone and WIM deposits. The continued strong performance from the New Britannia mill has freed up processing capacity at the Stall mill, where there is approximately 1,500 tonnes per day of available capacity which could be utilized by the regional satellite deposits to increase production and extend the life of the Snow Lake operations beyond 2037. Hudbay commenced an extensive summer drill program at the Talbot deposit in July focused on expanding the known mineralization and testing geophysical targets.

• Exploring large land package for new anchor deposit to significantly extend mine life - A majority of the land claims acquired as part of the Rockcliff Metals Corp. acquisition have been untested by modern deep geophysics, which was the discovery method for the Lalor deposit. A large geophysics program is currently underway consisting of surface electromagnetic surveys using cutting edge techniques that enable the team to detect targets at depths of almost 1,000 metres below surface. The planned geophysics program in 2025 is the largest geophysics program in Hudbay's history and includes 800 kilometres of ground electromagnetic surveys and an extensive airborne geophysics survey. The summer geophysics program is currently paused due to the regional wildfires and is expected to resume once the conditions improve and the evacuation orders are lifted.

Maria Reyna and Caballito Drill Permits Update

Hudbay controls a large, contiguous block of mineral rights with the potential to host satellite mineral deposits in close proximity to the Constancia processing facility, including the past producing Caballito property and the highly prospective Maria Reyna property. The Company commenced the drill permitting process at Maria Reyna and Caballito after completing a surface rights exploration agreement with the community of Uchucarcco in August 2022. As part of the drill permitting process, environmental impact assessment (EIA) applications were approved by the government in June 2024 for Maria Reyna and September 2024 for Caballito. The remaining steps in the drill permitting process include the completion by the government of the Consulta Previa consultation process with the local community.

Senior Management Team Appointments

In May 2025, Hudbay promoted Robert Carter to Senior Vice President, Canada and John O'Shaughnessy to Vice President, Manitoba Business Unit.

In his new role, Mr. Carter is responsible for the strategic oversight of Hudbay's business activities in Manitoba and British Columbia. Mr. Carter previously held the role of Vice President, Manitoba Business Unit since April 2022 and prior to that was the General Manager of Hudbay's Manitoba mines since 2018. He has over 25 years of mining industry experience in technical, operational and senior leadership roles, with a majority of those years at Hudbay.

As the new leader of the Manitoba Business Unit, Mr. O'Shaughnessy is responsible for the strategic and operational performance of Hudbay's activities in Manitoba. He previously held the role of Vice President, Business Development at Hudbay where he provided expert oversight and strategic leadership of the global mine planning process. He has over 25 years of mining industry experience, including numerous progressive engineering, operational and leadership roles at Vale's mining operations in Ontario and Newfoundland and Labrador.

Dividend Declared

A semi-annual dividend of C$0.01 per share was declared on August 12, 2025. The dividend will be paid out on September 19, 2025 to shareholders of record as of close of business on September 2, 2025.

1 Adjusted EBITDA, net debt, net debt to adjusted EBITDA ratio and free cash flow are non-GAAP financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-GAAP Financial Performance Measures" section of this MD&A.

2 Based on the initial capital investment and the $3.75 per pound copper price used in the PFS published on September 8, 2023 with assumptions of approximately $145 million for pre-sanctioning costs, $230 million from the precious metals stream, $350 million from project-level financing and approximately $700 million from the joint venture partner earn-in, matching contribution and capital contribution.