Q1/26 OPERATING AND FINANCIAL HIGHLIGHTS
Highlights for Q1/26 are summarized below and discussed further under “Consolidated Performance”:
Corporate Developments
| ● | On January 5, 2026, the Company completed the acquisition of Canadian Gold through a share-for-share transaction, issuing 2,943,766 common shares to Canadian Gold shareholders, other than the Company’s Chairman and Chief Executive Officer. In respect of his ownership interest, the Chairman and Chief Executive Officer received 1,529,508 subscription receipts, which are convertible into common shares subject to approval by the Company’s shareholders under applicable listing rules. If shareholder approval is not obtained, the subscription receipts will be settled in cash based on the fair value of the underlying shares at the transaction date, representing a potential cash obligation of approximately $30.0 million. |
| ● | On January 22, 2026, the Company issued 350,000 flow-through common shares at approximately $20.90 per share for gross proceeds of $7.3 million. Subsequently, on January 28, 2026, the Company issued an additional 377,000 flow-through common shares at approximately $21.25 per share for gross proceeds of $8.0 million. Proceeds will be used for the development of the Stock project. The Company has fulfilled its obligations related to the January 22, 2026 issuance, and the remaining CDE commitments from the January 28, 2026 financing are expected to be completed by May 31, 2026. |
| ● | On February 5, 2026, MSC paid a dividend of ARS $26.0 billion ($18.0 million) on a 100% basis, or ARS $12.7 billion ($8.8 million) attributable and paid to the Company. |
| ● | On February 6, 2026, McEwen Copper entered into a loan agreement for an amount of up to $240.0 million which may be advanced in one or more tranches upon mutual agreement between McEwen Copper as the borrower, the Company as the agent, and a syndicate of lenders. Approximately $28.5 million of additional funding has been secured under this loan agreement to date, including $13.6 million from the Company. As part of the loan agreement, the Company also received 203,280 transferable warrants to purchase shares of McEwen Copper at $40 per share. The proceeds of the loans are to be used for general corporate purposes, working capital, costs associated with a going public transaction, and to advance the Los Azules Project toward a Final Investment Decision. Annual interest on the loan is 12%. Subsequent to Q1/26, related parties provided McEwen Copper with an additional $4.0 million under the agreement. |
Subsequent Events
| ● | On April 30, 2026, the Company completed the acquisition of 100% of Golden Lake Exploration Inc.’s (“Golden Lake”) outstanding equity interests. Golden Lake is a mineral exploration company which has an option to purchase a 100% interest in the Jewel Ridge and Jewel Ridge West projects, which are located adjacent to the Company’s Windfall and Lookout Mountain properties. Under the terms of the arrangement, each Golden Lake shareholder will receive 0.003876 common shares of the Company for each Golden Lake common share held. Management is currently finalizing its assessment of the accounting treatment of the transaction. |
Operational Highlights
| ● | Q1/26 consolidated production of 30,471 GEOs, including 14,582 attributable GEOs from the San José mine(1), compared to 24,132 GEOs produced in Q1/25 which included 10,924 attributable GEOs from the San José mine(1). We remain on track to deliver 2026 production guidance of 114,000 to 126,000 GEOs. |
| ● | Q1/26 consolidated sales of 31,889 GEOs, including 16,137 attributable GEOs from the San José mine(1). This compares to 23,804 GEOs sold in Q1/25, including 10,769 attributable GEOs from the San José mine(1). |
| ● | At the Fox Complex, we invested approximately $9.9 million in the Stock project during Q1/26, completing key infrastructure work. The project is on track to reaching pre-commercial production in Q4/26 with development efforts focused on prioritizing Stock East ventilation and haulage ramps. At Froome, we produced 5,784 GEOs during Q1/26, representing a 5% increase compared to 5,520 GEOs in Q1/25, and was a result of 43% and 41% higher mined and processed grades, respectively, compared to Q1/25. The Fox Complex expects to meet its annual production guidance of 16,000 to 19,000 GEOs. |
| ● | At the Gold Bar Mine Complex, we produced 7,884 GEOs during Q1/26, representing a 3% increase compared to 7,688 GEOs in Q1/25. With increased mining rates planned for the remainder of the year, the Gold Bar Mine expects to meet its annual production guidance of 39,000 to 43,000 GEOs. |
| ● | At the San José Mine, Q1/26 production of 14,582 GEOs(1) increased by 33% compared to 10,924 GEOs(1) during Q1/25. MSC’s Q1/26 production increased due to a 6% increase in gold recovery rates and a 3% increase in silver recovery rates. MSC remains on track to meet its annual production guidance of 59,000 to 64,000 GEOs(1). |
| ● | We continued to meet safety expectations at our 100% owned operations. During Q1/26, we did not have any lost-time incidents at the Fox Complex, the Gold Bar Mine Complex, or El Gallo. |
Financial Highlights
| ● | Q1/26 revenues of $74.0 million were recognized from the sale of 15,752 GEOs from our 100% owned operations at an average realized price(2) of $4,792 per GEO. This compares to Q1/25 revenues of $35.7 million from the sale of 13,036 GEOs at an average realized price of $2,803 per GEO. |
| ● | We reported gross profit of $31.5 million in Q1/26 compared to $10.1 million in Q1/25. The change was primarily driven by a 21% increase in GEOs sold and a 71% increase in average realized price. |
| ● | Net income for Q1/26 was $33.4 million, or $0.56 per share, compared to a net loss of $6.3 million for Q1/25, or $0.12 per share. The improvement was primarily driven by a $21.4 million increase in gross profit and a $38.4 million increase in income from equity method investments, partially offset by $11.0 million increase in other operating expenses and $8.3 million in other expenses including a $5.2 million loss from marketable securities. |
| ● | Adjusted EBITDA(2) for Q1/26 was $44.8 million, or $0.76 per share, compared to Q1/25 adjusted EBITDA of $8.7 million, or $0.16 per share. Adjusted EBITDA excludes the impact of McEwen Copper and Paragon’s results and reflects the earnings of our operating properties, including the San José mine(1). |
| ● | Fox Complex unit costs: Cash costs(2) and AISC(2) per GEO sold in Q1/26 were $2,365 and $3,148 respectively. as compared to annual guidance ranges of $2,200 to $2,400 and $2,650 to $2,850, respectively. The Company plans for a decrease in AISC over the remainder of the year as planned mine development costs wind down at Froome. |
| ● | Gold Bar Mine Complex unit costs: Cash costs(2) and AISC(2) per GEO sold in Q1/26 were $2,460 and $2,705, respectively, as compared to annual guidance of $2,250 to $2,450 and $2,350 to $2,550, respectively. Our 2026 mine plans include a gradual decrease in strip ratios and an increase in mined ore, resulting in lower total costs and increased production in remaining quarters. As a result, AISC is expected to decrease through the year. |
| ● | San José unit costs: Cash costs(2) and AISC(2) per GEO sold in Q1/26 were $2,365 and $2,704, respectively, as compared to full year guidance of $2,000 to $2,200 and $2,300 to $2,500, respectively. Higher unit costs were primarily the result of 38% higher production costs driven by relative strength in the Argentine peso. As higher planned production is achieved through remaining quarters in 2026, we expect San José to decrease its unit costs. |
Exploration Highlights
| ● | We completed 17,000 feet (5,200 meters) of drilling at our Grey Fox deposit during Q1/26 to support the development of a resource estimate. This estimate will form the basis of ongoing technical studies for a pre-feasibility report, scheduled for release in H1/26. Preliminary technical evaluations, including trade-off analyses and mine design studies, indicate that Grey Fox is a robust and economically resilient asset with an anticipated mine life capable of supporting the growth of the Fox Complex. |
| ● | We incurred $3.1 million in exploration expenses at the Gold Bar Mine Complex during Q1/26, primarily to evaluate the resource potential of Windfall, Lookout Mountain, and the Gold Bar South targets, as well as to advance ongoing drilling at Trinity Ridge. At Windfall, drilling resumed in March, with one reverse circulation drill focused on defining mineralization to advance the target toward a potential resource. Planning was completed for drilling at Lookout Mountain to both expand the resource and convert inferred resources into indicated resources. This drilling program is expected to commence in Q2/26. |
| ● | We incurred $1.0 million in exploration expenses at the Tartan Mine Project during Q1/26. The exploration expense was primarily incurred on drilling aiming to expand the high grade portion of the Main Zone along the western flank and for the preparation of a technical report summary supporting the mineral resource estimate. |
(1) At our 49% attributable interest.
(2) T**his is a Non-GAAP financial performance measure. See “Non-GAAP Financial Performance Measures” beginning on page 41.
