Orla Mining ((TSE:OLA)) has held its Q2 earnings call. Read on for the main highlights of the call.
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Orla Mining’s recent earnings call revealed a mixed sentiment among investors and analysts. While the company celebrated record production and financial achievements, challenges such as the Camino Rojo pit wall incident and increased production costs tempered the overall outlook. Concerns in Mexico also added to the cautious sentiment.
Record Production and Revenue
Orla Mining reported a historic quarter, selling 79,000 ounces of gold at a realized price of $3,251 per ounce, generating approximately $264 million in revenue. This impressive performance was largely driven by the first full quarter of production from Musselwhite and ongoing operations at Camino Rojo.
Successful Musselwhite Integration
The integration of Musselwhite proved to be a significant success, with nearly 53,000 ounces of gold produced from 303,000 tonnes of ore. The site boasted a mill head grade of 5.52 grams per tonne and recovery rates of 96.5%, contributing substantially to the company’s overall production.
Strong Financial Performance
Orla Mining reported a net income of $48 million, or $0.15 per share, for the quarter. Adjusted net earnings were $64 million, or $0.20 per share. The company also generated $103 million in cash flow from operations before changes in noncash working capital, translating to $0.32 per share.
Exploration Success and Resource Update
The company released an initial underground resource estimate for Camino Rojo, revealing 4.2 million gold equivalent ounces in the measured and indicated category and 0.42 million in the inferred category. Zone 22 continues to be a promising area for future exploration.
Sustainability and Community Engagement
Orla Mining is preparing to publish its 2024 sustainability report, which will highlight progress in reducing Scope 3 emissions, enhancing environmental standards, and engaging in community projects. The company emphasized ongoing stakeholder engagement in Mexico and Nevada.
Camino Rojo Pit Wall Incident
An uncontrolled material movement event at Camino Rojo led to a temporary pause in in-pit mining, involving approximately 390,000 tonnes of material. This incident prompted a revision of the company’s gold production guidance for the year.
Increased Costs and Revised Guidance
Orla Mining revised its consolidated guidance for 2025, now expecting to produce 265,000 to 285,000 ounces of gold at cash costs of $900 to $1,100 per ounce. This is a reduction from the previous guidance of 280,000 to 300,000 ounces at $850 to $1,050 per ounce.
Labor and Security Concerns in Mexico
The company is reviewing labor practices and potential criminal activity at the Camino Rojo mine. While regional security risks are present, they have not yet impacted operations, though they remain a concern for the company and neighboring communities.
Forward-Looking Guidance
Orla Mining provided updated guidance for the remainder of 2025, adjusting its gold production expectations to between 95,000 and 105,000 ounces at cash costs of $800 to $900 per ounce sold. The company also revised its all-in sustaining costs to range from $850 to $950 per ounce sold. Despite the challenges, Orla highlighted strong quarterly production and significant contributions from the Musselwhite site.
In summary, Orla Mining’s earnings call presented a balanced view of achievements and challenges. While the company celebrated record production and successful integration of new operations, it also faced setbacks such as increased costs and incidents affecting production. The forward-looking guidance reflects these challenges, but the company’s strong quarterly performance and strategic initiatives offer a promising outlook for the future.