Erdene Resource Development (ERD) Q4 2025 earnings summary

Executive summary

• Bayan Khundii Gold Mine, a 50/50 joint venture, commenced production in September 2025, achieving first gold pour and entering ramp-up phase with strong operational progress and 93–96.3% recovery rates.

• The mine targets 80,000–85,000 oz of gold annually at high recoveries and low all-in sustaining costs, with significant exploration and expansion opportunities across the Khundii District and other regional projects.

• Construction and commissioning were completed in Q3 2025, with direct costs totaling US$120 million, within 20% of budget.

• Multiple district-scale gold, copper, and molybdenum projects are advancing, including Zuun Mod, Dark Horse, Striker West, Ulaan, Altan Nar, Khuvyn Khar, and Tereg Uul.

• 2025 marked a transition to gold producer status, with a focus on steady-state operations, district-scale exploration, and community development, including 40% local and 14% female workforce.

Financial highlights

• Q4 2025 generated $31 million in revenue from 7,434 oz of gold sold at an average price of CAD/US$4,187/oz, with 2,634 oz of silver also sold.

• Recognized a loss from the joint venture/investment in Erdene Mongol of $1.3–1.9 million for 2025, reflecting pre-operating costs offset by gold sales.

• Corporate exploration and evaluation expenses were CAD/US$2.5 million, up from CAD/US$1.9 million in 2024, mainly due to Teeg/Tereg Uul and new project evaluations.

• Corporate and administrative expenses decreased to nearly CAD/US$4 million from CAD/US$5 million in 2024, due to lower one-time financing costs.

• Ended 2025 with CAD 5 million in cash; post-February 2026 financing, treasury stands at CAD/US$30 million.

Outlook and guidance

• Targeting full production of 80,000–85,000 oz/year with all-in sustaining costs in the lowest quartile globally.

• Q1 2026 production update expected in late April; focus on achieving reserve feed grade of 3.8 g/t.

• No further capital injections required for Bayan Khundii; mine is now cash flow positive.

• Exploration and technical programs planned for Zuun Mod and Teeg/Tereg Uul, with first phase drilling at Teeg/Tereg Uul starting late April 2026.

• Preliminary Economic Assessment for Zuun Mod planned for completion in mid-2026.