Fresnillo (FRES) H2 2025 earnings summary

Executive summary

• Achieved record financial performance in 2025, with gold production exceeding guidance and silver in line with expectations, driven by strong cost control, operational discipline, and high precious metals prices.

• Completed the acquisition of Probe Gold in Canada, adding approximately 10 million ounces of gold resources and expanding the exploration and project pipeline.

• Returned a record $950 million to shareholders in dividends, representing 69% of earnings, well above the stated dividend policy.

• Maintained a strong balance sheet and significant free cash flow, enabling flexibility for future investments and shareholder returns.

• Captured $46 million in cost savings during the year.

Financial highlights

• Revenue and profitability reached record highs, with revenue up 30.5% to $4,561.2M and margins up sharply year-over-year due to higher gold and silver prices.

• Gross profit increased by 114% to $2,664.1M, operating profit by 142% to $2,292.5M, profit for the period by almost 600%, and EBITDA by 80.7% to $2,796.2M.

• Adjusted EPS surged 465.4% to $2.06 per share; cash and cash equivalents at year-end were $2,756.5M, up 112.4%.

• Cash flow from operations was $2.8 billion, up 80% year-over-year, resulting in a record year-end cash balance of $2.76 billion.

• Exploration expenses were $174 million, 6% higher than last year but below budget; exploration spend increased to $176.1M, with 800,434m drilled (+7.7% YoY).

Outlook and guidance

• 2026 is expected to be a transition year, with lower silver production due to mine sequencing and shaft connections, but production is expected to increase in 2027 and 2028.

• Gold production in 2026 will be supported by brownfield projects (Valles, Noche Buena) and higher output from Herradura in subsequent years.

• CapEx for 2026 is guided at $765 million, with lower CapEx expected in 2027 and 2028 as major projects are completed.

• Sustaining CapEx is expected to normalize around $500–$600 million per year, with temporary increases due to new projects.

• Exploration budget for 2026 is $308 million, with a shift toward advanced and greenfield projects.