Taseko Mines Ltd (TGB) Q2 2025 Earnings Call Highlights: Record Mining Quarter and Strategic ...
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
Taseko Mines Ltd (TGB) achieved a significant increase in mining tonnages at Gibraltar, with a 31% rise compared to Q1, marking the best mining quarter in the last four years.
The Florence project is advancing smoothly, with over 90% completion and key systems like the electrical substation already completed.
The company reported positive ore reconciliations in the connector pit, indicating more oxide ore than expected, potentially extending the SXEW plant's operation for at least 15 years.
Taseko Mines Ltd (TGB) received a $75 million cash payment from BC as part of the new prosperity agreement, enhancing financial stability.
The Yellowhead project shows significantly improved economics with an NPV of CAD 2 billion and an after-tax IRR of 21% at $4.25 copper, positioning it well against other North American copper projects.
Negative Points
The Gibraltar SXEW plant experienced a transformer issue, resulting in an expected 6 to 8 weeks of downtime, impacting production by less than 1 million pounds.
Adjusted earnings showed a net loss of $13 million or $0.04 loss per share, indicating financial challenges.
Total cash costs or C1 were reported at $3.14 per pound in the second quarter, higher than the previous quarter due to lower capitalized stripping and lower molybdenum production.
The company is facing volatility in the copper market due to recent copper tariff news, affecting the Comex copper price.
Florence's construction costs are tracking towards the higher end of the revised estimate, with total construction costs expected to reach around $265 million.
Q & A Highlights
Warning! GuruFocus has detected 8 Warning Signs with TGB.
Q: Can you provide some commentary on the expected grades and recoveries for Q3 at Gibraltar? A: (Stuart McDonald, CEO) We expect both grade and recovery to improve significantly in Q3, moving towards reserve grade averages or better, and potentially exceeding reserve grade in Q4. As we access higher quality ore, we anticipate these improvements to continue into early 2026.
Q: Does the higher oxide material in the connector pit pose a risk for recoveries in Q3? A: (Stuart McDonald, CEO) The oxidation is a transition rather than a binary issue. We are confident in our projections and expect to see higher grade and better quality ore in the coming weeks and months.
Q: Is the production target for Florence still in the range of 40 to 50 million pounds next year? A: (Stuart McDonald, CEO) The technical report indicates around 40 million pounds for year one. We are currently working on a detailed operating plan and expect to provide more specific guidance closer to the startup in the fall.
Q: What pricing are you seeing for sulfuric acid currently? A: (Richard Trombley, COO) We are seeing prices in the low 200 range for sulfuric acid. We have secured supply for this year from two different suppliers.
Q: Should we expect more capitalized stripping at Gibraltar in Q3, and how is the remaining spend at Florence distributed? A: (Stuart McDonald, CEO) The remaining spend at Florence is weighted towards Q3, with Q4 focusing on commissioning and operations. At Gibraltar, capital stripping will drop off significantly in the second half as we operate below the average strip rate.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
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