Andean Precious Metals Earnings Call Highlights Record Year

Andean Precious Metals Corp ((TSE:APM)) has held its Q4 earnings call. Read on for the main highlights of the call.

Andean Precious Metals’ latest earnings call painted a largely upbeat picture, with management stressing record 2025 revenue, EBITDA and net income alongside robust free cash flow and a fortified balance sheet. Executives acknowledged cost pressures, assay delays and market volatility, but framed these as manageable execution issues against a backdrop of strong fundamentals and clear 2026 catalysts.

Record Financial Results Underpin Investor Confidence

Andean reported record 2025 revenue of $359 million, adjusted EBITDA of $133 million and net income of $118 million, or $0.78 per share, underscoring significant earnings leverage to precious metals prices. The fourth quarter was particularly strong, delivering $134 million in revenue and $47 million in adjusted EBITDA, confirming a solid exit rate heading into 2026.

Cash Generation and Liquidity Position Strengthen

The company converted earnings into cash effectively, generating free cash flow of $36 million in Q4 and $59 million for the full year, implying a free cash flow margin of about 16.4 percent. Andean closed the year with a record $167 million in liquid assets, split between cash, treasuries and strategic equity holdings, amounting to roughly 38.5 percent of total assets.

Balance Sheet Deleveraging Boosts Flexibility

Total assets climbed to $434 million while total liabilities fell to $170 million, leaving liabilities at about 39.2 percent of assets and materially improving leverage metrics. Management highlighted the full repayment of legacy credit facilities and the establishment of a new $40 million revolving credit line, giving Andean ample firepower for organic growth and opportunistic moves.

Operational Performance at San Bartolome and Golden Queen

Consolidated production came in just under 100,000 gold equivalent ounces, with San Bartolome contributing 53,854 GEO and Golden Queen 45,311 GEO for a total of 99,165 GEO. Fourth quarter output was 27,777 GEO, and management emphasized that both mines were meaningful profit drivers, with San Bartolome steady and Golden Queen gaining momentum into year‑end.

Unit Costs and Margin Profile Show Upside Potential

San Bartolome produced 4.5 million ounces of silver with a cash gross operating margin of $16.11 per ounce and a healthy gross margin ratio of 42.75 percent, demonstrating strong asset quality. Golden Queen’s 2025 cash costs were $1,698 per gold ounce and all‑in sustaining costs of $2,194 per ounce, with management pointing to 2026 guidance ranges that imply scope for margin improvement at both operations.

Capital Plans Support Growth and Mine Life

Andean outlined a 2026 capital program combining sustaining and growth investment to underpin production and extend mine life. Planned spending of $17 million to $24 million on sustaining capital and $21 million to $30 million on growth projects will fund leach pad expansion, plant optimization and key infrastructure upgrades across the portfolio.

Exploration Progress at Golden Queen

At Golden Queen, the company completed 47 core drill holes in 2025 aimed at expanding known mineralization and supporting longer‑term mine life extensions. Management plans to step up infill drilling in 2026 to convert inferred resources into higher‑confidence categories, positioning the asset for future reserve growth and potentially higher net asset value.

Corporate Catalysts: NYSE Listing and Technical Report

Andean flagged two major corporate catalysts for 2026 in the form of a planned New York Stock Exchange listing and an updated technical report for Golden Queen. The technical report has been pushed out to include 2025 drill results, but management framed this delay as value‑accretive, as it should capture a more complete picture of the asset’s potential.

Production Slightly Trails Earlier Guidance

Despite the strong financials, full‑year production landed just shy of the lower end of guidance, at 99,165 GEO versus a target slightly above that level. Management characterized this as a modest shortfall rather than a structural issue, pointing to operational strength at both mines and reaffirming higher production ranges for 2026.

Technical Report and Assay Delays Slow Resource Updates

An independent assay lab backlog forced Andean to delay the Golden Queen technical report by roughly three to four months, with completion now expected later in the year. This slows formal resource disclosure and may defer the timing of reserve upgrades, but does not negate the drilling results themselves, which management believes remain encouraging.

Q4 Cost Inflation at Golden Queen Weighs on AISC

Costs at Golden Queen rose between the third and fourth quarters, driven by inventory adjustments and accelerated capital spending late in the year that flowed through reported all‑in sustaining costs. This pushed 2025 AISC to $2,194 per ounce, although management stressed that the elevated Q4 figure reflects timing factors rather than a new structural cost base.

Marketable Securities and FX Swings Add Noise

Andean’s portfolio of strategic equity investments and marketable securities saw valuation declines due to broader market volatility, leading to revaluation and foreign exchange losses on reported results. Management suggested some of this pressure could reverse over time but cautioned investors that short‑term swings in these holdings will continue to add non‑operational noise to earnings.

Commodity and Energy Prices Remain Key Risks

The company highlighted exposure to diesel and consumable inflation as a risk to margins if oil prices stay elevated or rise further, particularly at energy‑intensive operations. At San Bartolome, margins can also compress quickly in a sharp drop in silver prices because the business uses a mix of spot purchases and fixed‑price feed contracts, increasing sensitivity to market moves.

Assay Cutoffs May Prolong Resource Conversion

Management cautioned that continued assay lab delays and conservative choices on data cutoffs mean some 2026 drilling may not appear in the next Golden Queen resource update. That could push out the timeline for translating exploration success into formal reserve and resource figures, delaying when this upside becomes fully reflected in technical documentation.

Guidance and Outlook Emphasize Growth and Discipline

Looking ahead, Andean is targeting 2026 consolidated production of 100,000 to 114,000 gold equivalent ounces, weighted slightly toward the second half of the year. Cost guidance calls for Golden Queen cash costs of $1,500 to $1,800 per ounce and AISC of $1,850 to $2,150, while San Bartolome is expected to deliver silver margins of $20 to $35 per ounce and gross margin ratios between 35 and 45 percent, supported by a balanced capital plan and upcoming corporate catalysts.

Andean’s earnings call ultimately delivered a constructive message for investors, blending record 2025 financial performance with a clear, fully funded plan for 2026 and beyond. While operational delays, cost timing and market volatility remain watch points, management’s focus on cash generation, balance sheet strength and strategic milestones suggests the company is positioned to navigate near‑term noise and continue compounding value.