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Hudbay Delivers Strong Second Quarter 2025 Results
TORONTO, Aug. 13, 2025 (GLOBE NEWSWIRE) -- Hudbay Minerals Inc. ('Hudbay' or the 'Company') (TSX, NYSE: HBM) today released its second quarter 2025 financial results. All amounts are in U.S. dollars, unless otherwise noted. "We delivered another quarter of significant free cash flow generation driven by continued industry-leading cost margins and diversified exposure to copper and gold,' said Peter Kukielski, President and Chief Executive Officer. 'Our strong financial performance enabled us to further reduce long-term debt, invest in our many high-return growth projects and further strengthen our balance sheet to its best position in over a decade. With the strong performance in the first half of the year, we are reaffirming our full year consolidated production guidance and are favourably tracking well below our full year consolidated cost guidance for 2025. The announcement of our Copper World joint venture agreement with Mitsubishi further solidifies our financial strength and significantly reduces our funding requirement for project development. We are delighted to have secured the premier joint venture partner and look forward to establishing a long-term strategic partnership that will unlock significant value in our copper growth pipeline. Through a highly accretive joint venture, an agreement to enhance the Copper World precious metals stream terms, and the achievement of our financial targets, we have successfully realized the key elements of our prudent financial plan and significantly de-risked the Copper World project as we advance towards a sanction decision in 2026.' Delivered Strong Second Quarter Financial Results; Production Reaffirmed and Cost Guidance Improved Achieved revenue of $536.4 million and adjusted EBITDAi of $245.2 million in the second quarter of 2025. Strong financial results were driven by attractive operating cost margins and significant exposure to copper and gold across Hudbay's diversified operating portfolio. Steady production continued into the second quarter with consolidated copper production of 29,956 tonnes and consolidated gold production of 56,271 ounces. Industry-leading cost performance continued in the second quarter with consolidated cash costi and sustaining cash costi per pound of copper produced, net of by-product credits, of $(0.02) and $1.65, respectively. Reaffirmed full year 2025 consolidated production guidance of 117,000 to 149,000 tonnes of copper and 247,500 to 308,000 ounces of gold. Improved full year 2025 consolidated cash costi guidance to $0.65 to $0.85 per pound from $0.80 to $1.00 per pound, as year-to-date results are trending well below the low end of the cost ranges due to increased exposure to gold by-product credits and continued strong cost control across all operations. Peru operations produced 21,710 tonnes of copper and 7,366 ounces of gold in the second quarter, in line with quarterly cadence expectations, despite lower average mill throughput of approximately 83,100 tonnes per day due to a planned semi-annual mill maintenance shutdown in the second quarter. Peru cash costi per pound of copper produced, net of by-product credits, was $1.45 in the second quarter, in line with the annual guidance range. Manitoba operations produced 43,235 ounces of gold in the second quarter, slightly lower than quarterly cadence expectations as a result of a temporary shutdown of operations due to wildfire evacuation orders, partially offset by continued strong gold grades at Lalor and mill throughput outperformance at New Britannia. Manitoba cash costi per ounce of gold produced, net of by-product credits, was $710 in the second quarter, in line with the annual guidance range. British Columbia operations produced 6,634 tonnes of copper at a cash costi per pound of copper produced, net of by-product credits, of $2.39 in the second quarter, reflecting efficiency benefits from Hudbay's optimization initiatives. Second quarter net earnings attributable to owners and earnings per share attributable to owners were $117.7 million and $0.30, respectively, a 17% and 20% increase, respectively, compared to the first quarter of 2025 and a significant increase compared to second quarter of 2024, driven by higher gross margins and strong cost control. After adjusting for various non-cash items, second quarter adjusted earningsi per share attributable to owners was $0.19. Cash and cash equivalents increased by $62.9 million to $625.5 million during the second quarter and total liquidity was $1,050.2 million as at June 30, 2025. Continued Free Cash Flow Generation Driving Further Debt Reduction and Balance Sheet Resilience Hudbay's unique copper and gold diversification across its operations provides exposure to higher copper and gold prices, which together with a focus on cost control across the business, continues to expand margins and generate attractive free cash flowi. While the majority of revenues continue to be derived from copper production, gold represented more than 36% of total revenues in the second quarter of 2025. Delivered the eighth consecutive quarter of meaningful free cash flowi generation with $87.8 million achieved during the second quarter of 2025, resulting in more than $400 million in annual free cash flowi over the last twelve months. Achieved adjusted EBITDAi of $245.2 million in the second quarter of 2025, resulting in record annual trailing twelve-month adjusted EBITDA of $995.9 million. Repurchased and retired an additional $50 million of senior unsecured notes through open market purchases at a discount to par during the second quarter, reducing total principal debt to $1.07 billion as of June 30, 2025. Approximately $295 million in total debt repayments and gold prepayment liability reductions have been achieved since the beginning of 2024. Net debti significantly reduced to $434.1 million as at June 30, 2025 compared to $525.7 million at December 31, 2024, a decrease of $91.6 million in the first half of 2025. Net debt to adjusted EBITDA ratioi was 0.4x at the end of the second quarter of 2025, an improvement from 0.6x at the end of the first quarter of 2025 and 0.8x at the end of the second quarter of 2024. This is the lowest net leverage level achieved since Hudbay developed Constancia over a decade ago. Current balance sheet expected to be further enhanced with proceeds from the $600 million Copper World joint venture transaction, as mentioned below. On a pro forma basis, as at June 30, 2025, this would increase cash and cash equivalents to more than $1.0 billion and total liquidity to more than $1.5 billion, while reducing net debti to zero. Prudently Advancing Copper World with Accretive Minority Joint Venture Transaction, Enhanced Stream Transaction and Successful Achievement of '3-P' Plan Announced $600 million Copper World joint venture transaction with Mitsubishi Corporation ('Mitsubishi') for a 30% minority interest ('JV Transaction'). Implies a significant premium to consensus net asset value for Copper Worldii. Mitsubishi's $600 million initial investment will consist of $420 million at closing and $180 million within 18 months of closing. Mitsubishi will also fund its pro-rata 30% share of future equity capital contributions. Increases levered project IRR to Hudbay to approximately 90% based on pre-feasibility study ('PFS') estimatesiii. Secures a premier long-term strategic partner in Mitsubishi, one of the largest Japanese trading houses with a global mining presence and a significant U.S. based business. Mitsubishi is the strategic partner of choice with investments in a world-class portfolio of large and high-quality copper assets, including five of the top twenty copper mines globally by 2024 production. Mitsubishi's wholly owned U.S. subsidiary, Mitsubishi Corporation (Americas), has over 50 subsidiaries and affiliates across various business sectors, including mineral resources, oil & gas, real estate, mobility, food, power, etc., and manages the company's strategic investments with approximately $9 billion in total assets and trading businesses in North America, which encompass trading activity with a substantial volume of copper, precious metals, and aluminum in the U.S. market. Strategic partnership validates the attractive long-term value of Copper World as a world-class copper asset and endorses the strong technical capabilities of Hudbay. Agreed on terms with Wheaton Precious Metals Corp. ('Wheaton') to amend the existing precious metals streaming agreement. In addition to the initial $230 million stream deposit, provides an additional contingent payment of up to $70 million on a future potential mill expansion recognizing the long-term potential at Copper World. Ongoing payments for gold and silver amended from fixed pricing to 15% of spot prices to provide upside exposure to higher precious metals prices. Updated structure aligns with the current development plan for Copper World and the joint venture agreement. Successfully completes key elements of Hudbay's prudent financial strategy as part of the three prerequisites ('3-P') plan for Copper World with the announcements of the JV Transaction and the enhanced Wheaton stream, together with the achievements of stated balance sheet targets. Before accounting for proceeds from this Transaction, Hudbay had achieved more than $600 million of cash and cash equivalents and a 0.4x net debt to adjusted EBITDA ratioi, as of June 30, 2025, far exceeding the stated balance sheet targets. The Mitsubishi initial investment and its pro-rata equity capital contributions, together with the amended Wheaton stream, provide significant financial flexibility by reducing Hudbay's estimated share of the remaining capital contributions to approximately $200 million based on PFS estimatesiii, and defers Hudbay's first capital contribution until 2028 at the earliest. Well positioned to advance Copper World towards a sanction decision in 2026. Feasibility study for Copper World is underway with expected completion of a definitive feasibility study ('DFS') by mid-2026. With this successful de-risking milestone at Copper World, Hudbay expects to accelerate detailed engineering, some key long lead items and other de-risking activities by advancing $20 million in growth capital expenditures to 2025 from future years, and is updating total 2025 Arizona growth spending guidance to $110 million from $90 million on a 100% basis. Reinvesting in High-return Growth Initiatives to Further Enhance Copper and Gold Exposure Advancing high-return brownfield mill enhancement initiatives and greenfield copper projects to drive near-term and long-term production growth with $33.1 million in growth capital expenditures during the second quarter of 2025. Optimization efforts at Copper Mountain are focused on executing the planned accelerated stripping program and mill throughput improvement projects. The planned conversion of the third ball mill to a second SAG mill remains on budget and on schedule, with completion of the initial phase achieved on July 10 and ramp up of the final phase expected in the fourth quarter of 2025. Mining of first zinc ore from the exploration and haulage drifts at 1901 was achieved in the second quarter, and planned activities over the next two years are expected to de-risk the path towards full production in 2027. Large exploration program in Snow Lake continues to execute threefold strategy focused on near-mine exploration to increase near-term production and mineral reserves, testing regional satellite deposits for additional ore feed to utilize available capacity at the Stall mill, and exploring the large land package for a potential new anchor deposit to meaningfully extend mine life. Drilling commenced at the Talbot copper-zinc-gold deposit near Snow Lake as part of a large summer exploration program. Continuing to advance Flin Flon tailings reprocessing opportunities through metallurgical test work and economic evaluation to assess the possibility of producing critical minerals and precious metals in an environmentally friendly manner. Completed transaction with Mitsubishi Materials Corporation to consolidate Hudbay's 100% ownership of the Copper Mountain mine in a highly accretive transaction to further increase Hudbay's exposure to a long-life, high-quality copper asset in a tier-1 mining jurisdiction, resulting in an expected 200% increase in attributable copper production from Copper Mountain in 2027 compared to 2024iv. Permitting application for the New Ingerbelle growth project at Copper Mountain was accepted for review by the B.C. Major Mines Office in May and is proceeding through the Mine Review Committee review process. Continuing to enhance stakeholder engagement and advance additional metallurgical studies at the Mason copper project in Nevada. Summary of Second Quarter Results Steady production continued into the second quarter of 2025 with consolidated copper production of 29,956 tonnes and consolidated gold production of 56,271 ounces. Consolidated copper and gold production was lower than the first quarter of 2025 primarily due to the impacts of a temporary suspension of operations in Manitoba as a result of mandatory wildfire evacuation orders. Consolidated silver production of 814,989 ounces and zinc production of 5,130 tonnes in the second quarter of 2025 were also lower than the first quarter of 2025 for the aforementioned reason. Cash generated from operating activities of $259.9 million increased compared to the first quarter of 2025 as a result of higher gross margins driven by stable copper production, higher realized prices and positive working capital management with reductions in finished goods inventories and receivable balances. Operating cash flow before change in non-cash working capital was $193.9 million during the second quarter of 2025, reflecting an increase of $30.4 million compared to the first quarter of 2025. The increase compared to the first quarter of 2025 was primarily the result of lower cash taxes paid offset by lower gold and copper sales volume in Manitoba. Second quarter adjusted EBITDAi was $245.2 million, a 15% decrease compared to $287.2 million in the first quarter of 2025 due to lower sales volume partially offset by higher gold prices. Net earnings attributable to owners in the second quarter of 2025 was $117.7 million, or $0.30 per share, compared to $100.4 million, or $0.25 per share, in the first quarter of 2025. The increase in earnings is the result of high gross margins from strong revenue growth on the back of stable copper production and higher realized gold prices. In addition, the quarter benefited from various non-cash charges for revaluation gain of closed sites reclamation provisions, and significantly reduced net finance expenses, among other items, more than offsetting the high mining and income tax expense experienced in the current quarter. Adjusted net earnings attributable to ownersi and adjusted net earnings per share attributable to ownersi in the second quarter of 2025 were $75.5 million and $0.19 per share, respectively, after adjusting for various non-cash items on a pre-tax basis such as a non-cash $18.9 million foreign exchange gain, a non-cash gain of $13.8 million related to quarterly revaluation of Hudbay's closed site environmental reclamation provision, a $6.3 million mark-to-market revaluation gain on various instruments such as investments and share-based compensation, and a $1.2 million gain related to flow-through share expenditures, among other items. This compares to adjusted net earnings attributable to ownersi and net earnings per share attributable to ownersi of $93.8 million and $0.24 per share in the first quarter of 2025. In the second quarter of 2025, consolidated cash costi per pound of copper produced, net of by-product credits, was $(0.02), compared to $(0.45) in the first quarter of 2025 as the Company continued to demonstrate industry-leading cost performance. The change from the first quarter was a result of lower by-product credits and lower production levels in Manitoba during the second quarter. Consolidated sustaining cash costi per pound of copper produced, net of by-product credits, was $1.65 in the second quarter of 2025, compared to $0.72 in the first quarter of 2025. The increase was driven by planned higher sustaining capital expenditures and the aforementioned variance in cash cost. Consolidated all-in sustaining cash costi per pound of copper produced, net of by-product credits, was $2.03 in the second quarter of 2025, higher than $0.97 in the first quarter of 2025 mainly due to the same reasons outlined above as well as higher corporate G&A from the revaluation of the Company's stock based compensation due to relative higher share prices. As at June 30, 2025, total liquidity was $1,050.2 million, including $625.5 million in cash and cash equivalents, and undrawn availability of $424.7 million under Hudbay's revolving credit facilities. Net debti at the end of the second quarter was $434.1 million, marking a $92.0 million improvement from the first quarter of 2025 as a result of deleveraging activities. Consolidated Financial Condition (in $ millions, except net debt to adjusted EBITDA ratio) Jun. 30, 2025 Mar. 31, 2025 Dec. 31, 2024 Cash and cash equivalents and short-term investments 625.5 582.6 581.8 Total long-term debt 1,059.6 1,108.7 1,107.5 Net debt1 434.1 526.1 525.7 Working capital2 26.8 598.0 511.3 Total assets 5,628.6 5,507.0 5,487.6 Equity attributable to owners of the Company 2,863.3 2,653.2 2,553.2 Net debt to adjusted EBITDA1,3 0.4 0.6 0.6 1 Net debt and net debit to adjusted EBITDA are non-GAAP financial performance measures with no standardized definition under IFRS. For further information, please see the "Non-GAAP Financial Performance Measures" section of this news release. 2 Working capital is determined as total current assets less total current liabilities as defined under IFRS and disclosed on the consolidated financial statements. Working capital as of June 30, 2025 was impacted by an increase in the current portion of long-term debt of $523.8 million as the 2026 Notes are now maturing within one year. 3 Net debt to adjusted EBITDA for the 12 month Financial Performance Three Months Ended Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Revenue $000s 536.4 594.9 425.5 Cost of sales $000s 359.9 363.6 347.9 Earnings before tax $000s 153.1 171.3 0.4 Net earnings $000s 114.7 99.2 (20.3) Net earnings attributable to owners $000s 117.7 100.4 (16.5) Basic and diluted attributable earnings per share1 $/share 0.30 0.25 (0.04) Adjusted earnings attributable per share1 $/share 0.19 0.24 0.00 Operating cash flow before change in non-cash working capital $ millions 193.9 163.5 123.7 Adjusted EBITDA1 $ millions 245.2 287.2 145.0 Free cash flow1 $ millions 87.8 87.4 32.5 1 Adjusted earnings per share - attributable to owners, adjusted EBITDA and free cash flow are non-GAAP financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see discussion under the 'Non-GAAP Financial Performance Measures' section of this news Production and Cost Performance Three Months Ended Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Contained metal in concentrate and doré produced1 Copper tonnes 29,956 30,958 28,578 Gold ounces 56,271 73,784 58,614 Silver ounces 814,989 919,775 738,707 Zinc tonnes 5,130 6,265 8,087 Molybdenum tonnes 375 397 369 Payable metal sold Copper tonnes 30,354 31,768 25,799 Gold2 ounces 62,466 75,092 61,295 Silver2 ounces 894,160 1,006,968 667,036 Zinc tonnes 2,871 4,857 5,133 Molybdenum tonnes 427 448 347 Consolidated cash cost per pound of copper produced3 Cash cost $/lb (0.02) (0.45) 1.14 Sustaining cash cost $/lb 1.65 0.72 2.65 All-in sustaining cash cost $/lb 2.03 0.97 3.07 1 Metal reported in concentrate is prior to deductions associated with smelter contract terms. 2 Includes total payable gold and silver in concentrate and in doré sold. 3 Cash cost, sustaining cash cost and all-in sustaining cash cost per pound of copper produced, net of by-product credits, are non-IFRS financial performance measures with no standardized definition under IFRS. For further information, please see the 'Non-IFRS Financial Performance Measures' section of this news release. Peru Operations Review Peru Operations Three Months Ended Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Constancia ore mined1 tonnes 6,735,316 8,628,279 5,277,654 Copper % 0.34 0.28 0.29 Gold g/tonne 0.03 0.03 0.03 Silver g/tonne 3.26 3.14 2.50 Molybdenum % 0.02 0.02 0.01 Pampacancha ore mined1 tonnes 762,172 389,189 1,288,789 Copper % 0.26 0.44 0.41 Gold g/tonne 0.24 0.26 0.20 Silver g/tonne 4.59 3.68 3.83 Molybdenum % 0.01 0.01 0.02 Total ore mined tonnes 7,497,488 9,017,468 6,566,443 Strip ratio4 1.47 1.02 1.74 Ore milled tonnes 7,559,047 8,114,024 7,718,962 Copper % 0.34 0.30 0.30 Gold g/tonne 0.05 0.05 0.07 Silver g/tonne 3.58 3.22 2.85 Molybdenum % 0.01 0.01 0.01 Copper recovery % 84.5 84.6 83.1 Gold recovery % 56.0 56.5 61.4 Silver recovery % 63.5 66.0 63.9 Molybdenum recovery % 38.7 35.7 46.3 Contained metal in concentrate Copper tonnes 21,710 20,293 19,217 Gold ounces 7,366 7,869 10,672 Silver ounces 551,979 554,692 450,833 Molybdenum tonnes 375 397 369 Payable metal sold Copper tonnes 21,418 22,890 16,806 Gold ounces 9,721 14,362 13,433 Silver ounces 616,578 714,654 400,302 Molybdenum tonnes 427 448 347 Combined unit operating cost2,3 $/tonne 13.59 11.09 12.68 Cash cost3 $/lb 1.45 1.11 1.78 Sustaining cash cost3 $/lb 2.63 1.92 2.60 1 Reported tonnes and grade for ore mined are estimates based on mine plan assumptions and may not reconcile fully to ore milled. 2 Reflects combined mine, mill and general and administrative ("G&A") costs per tonne of ore milled. Reflects the deduction of expected capitalized stripping costs. 3 Combined unit costs, cash cost and sustaining cash cost per pound of copper produced, net of by-product credits, are non-IFRS financial performance measures with no standardized definition under IFRS. For further information, please see the 'Non-IFRS Financial Performance Measures' section of this news release. 4 Strip ratio is calculated as waste mined divided by ore mined. The Peru operations continued to demonstrate steady operating performance with production and costs in line with expectations. During the second quarter of 2025, the Peru operations produced 21,710 tonnes of copper, 7,366 ounces of gold, 551,979 ounces of silver and 375 tonnes of molybdenum. Copper production increased in the second quarter of 2025 compared to the first quarter of 2025 as milled copper grades exceeded first quarter levels, partially offset by planned lower mill throughput due to a scheduled mill maintenance shutdown in the second quarter. Production of all other metals were relatively in line with the first quarter of 2025. The last major stripping program at Pampacancha was completed in the second quarter of 2025, which included higher amounts of waste stripping than planned. As a result, the Company replaced higher grade Pampacancha ore with higher grade Constancia ore in the second quarter and the Pampacancha deposit is now expected to be depleted in the first quarter of 2026 rather than in late 2025. Protests that started early in the third quarter temporarily impacted the transportation of supplies and concentrate to and from the Constancia site and has affected mine sequencing. The Constancia mill has continued to operate during this period, and the road blockades along the concentrate transportation route have since reopened, allowing Hudbay to reduce site concentrate inventory levels and replenish supplies. Despite short-term mine plan changes, the Company remains on track to achieve its 2025 production guidance for all metals in Peru. Total ore mined in Peru in the second quarter of 2025 was lower than the first quarter of 2025 but remained in line with mine plan expectations. Mill throughput levels averaged approximately 83,100 tonnes per day in the second quarter of 2025, lower than the first quarter of 2025 due to the planned semi-annual mill maintenance shutdown during the current quarter. Milled copper grades increased by 13% relative to the first quarter of 2025 due to higher grades in the Constancia pit. Milled gold grades in the second quarter remained consistent with gold grades in the first quarter of 2025 as Pampacancha stripping activities were underway in both quarters. The mill achieved copper recoveries of 85% in the second quarter of 2025, remaining consistent with the first quarter of 2025. Recoveries of gold and silver during the quarter were in line with Hudbay's metallurgical models for the ore that was being processed. Combined mine, mill and G&A unit operating costi in the second quarter of 2025 was $13.59 per tonne, 23% higher than the first quarter, as expected, due to higher plant maintenance costs and lower tonnes processed associated with the planned semi-annual mill maintenance shutdown. Cash costi per pound of copper produced, net of by-product credits, in the second quarter of 2025 was $1.45, an increase of 31% compared to the first quarter of 2025 due to planned higher maintenance costs and lower by-product credits, partially offset by lower treatment and refining charges and higher copper production. Sustaining cash costi per pound of copper produced, net of by-product credits, was $2.63 in the second quarter of 2025, an increase compared to the first quarter of 2025 due to planned higher sustaining capital typically associated with the period after the rainy season is complete, as well as the same factors affecting cash costs. Hudbay is reaffirming its full year 2025 cash cost guidance range in Peru. Manitoba Operations Review Manitoba Operations Three Months Ended Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Lalor Ore mined tonnes 303,062 384,234 385,478 Gold g/tonne 4.97 5.46 3.75 Copper % 0.61 0.95 0.69 Zinc % 2.46 2.42 2.76 Silver g/tonne 29.94 31.23 22.29 New Britannia Ore milled tonnes 162,934 189,124 167,899 Gold g/tonne 6.48 7.37 5.31 Copper % 0.65 1.18 0.94 Zinc % 1.01 1.00 0.92 Silver g/tonne 30.29 33.35 24.42 Gold recovery1 % 89.4 90.3 90.0 Copper recovery % 87.4 90.3 94.4 Silver recovery1 % 78.0 81.6 83.1 Stall Concentrator Ore milled tonnes 144,204 215,286 229,527 Gold g/tonne 3.19 3.86 3.02 Copper % 0.56 0.76 0.59 Zinc % 4.20 3.44 4.05 Silver g/tonne 29.55 29.53 21.74 Gold recovery % 67.9 70.1 65.5 Copper recovery % 84.7 88.3 85.4 Zinc recovery % 84.8 84.7 87.1 Silver recovery % 51.9 58.7 54.2 Total contained metal in concentrate and doré2 Gold ounces 43,235 60,354 43,488 Copper tonnes 1,612 3,469 2,642 Zinc tonnes 5,130 6,265 8,087 Silver ounces 197,970 285,603 210,647 Total payable metal sold Gold ounces 46,932 55,765 42,763 Copper tonnes 2,133 2,725 2,429 Zinc tonnes 2,871 4,857 5,133 Silver ounces 209,594 232,255 197,486 Combined unit operating cost3,4,5 C$/tonne 241 214 225 Gold cash cost4,5 $/oz 710 376 771 Gold sustaining cash cost4 $/oz 1,025 626 1,163 1 Gold and silver recovery includes total recovery from concentrate and doré. Doré includes sludge, slag and carbon fines. 2 Metal reported in concentrate is prior to deductions associated with smelter terms. 3 Reflects combined mine, mill and G&A costs per tonne of milled ore. 4 Combined unit cost, cash cost, sustaining cash cost per pound of copper produced, net of by-product credits, gold cash cost and sustaining cash cost per ounce of gold produced, net of by-product credits, are non-GAAP financial performance measures with no standardized definition under IFRS. For further information, please see the 'Non-GAAP Financial Performance Measures' section of this news release. 5 Excludes $3.2 million (C$14 per tonne or $74 per ounce) of overhead costs incurred during temporary suspension during the three months ended June 30, 2025. Despite significant disruptions from the mandatory wildfire evacuation orders in May and June of this year, the Manitoba operations showed remarkable resilience and achieved several key milestones in the second quarter of 2025. Notably, the New Britannia mill achieved record monthly production in April, the 1901 mining area delivered its first ore for processing in June, and Hudbay signed an exploration agreement with Mosakahiken Cree Nation to explore the Talbot deposit. The Manitoba operations delivered strong results in the second quarter of 2025, producing 43,235 ounces of gold, 1,612 tonnes of copper, 5,130 tonnes of zinc and 197,970 ounces of silver. Compared to the first quarter of 2025, production of gold, copper, silver and zinc in the second quarter of 2025 decreased by 28%, 54%, 31% and 18%, respectively, due to lower production in June associated with the wildfire evacuation shutdown, in addition to the first quarter of 2025 having significantly better than expected gold grades. Hudbay's dedicated on-site team demonstrated tremendous effort and unwavering commitment during the unprecedented wildfire situation near the Company's Flin Flon and Snow Lake operations during the second quarter. The team tirelessly safeguarded Hudbay's assets and collaborated closely with local communities and provincial authorities, providing essential support to emergency response efforts. These efforts resulted in no damage to Hudbay's infrastructure and facilities. The Lalor mine managed through a period of reduced workforce prior to and after the 13-day temporary suspension of operations in June due to mandatory wildfire evacuation orders. Despite these challenges, the mine averaged 3,300 tonnes per day in the second quarter, strategically prioritizing mining from gold zones to ensure a consistent feed for the New Britannia mill. Gold grades were in line with mine plan expectations, while being lower than the exceptional gold grade mined in the first quarter of 2025. Copper, zinc and silver grades were also consistent with mine plan expectations for the quarter. Continuous improvement efforts at Lalor focused on ore quality and advancing stope modifications to enhance mucking productivity. Capital development continued, aiming to secure high-grade copper-gold mineralization from Zone 27 and prepare Zone 17 for the next copper-gold mining front. The New Britannia mill achieved record monthly production levels in April, exceeding 2,300 tonnes per day. This significant milestone is a testament to ongoing low-capital projects and recent piping improvements that boosted throughput and maintained gold recoveries. The New Britannia mill throughput averaged approximately 1,800 tonnes per day in the second quarter of 2025, reflecting the record levels achieved in April, offset by lower throughput levels in June associated with the wildfire evacuation shutdown. Gold recovery in the second quarter of 2025 was 89%, remaining relatively consistent with the first quarter of 2025. In the second quarter, the Stall mill continued to process less ore compared to prior periods, which is aligned with Hudbay's strategy of allocating more Lalor ore feed to New Britannia to maximize gold recoveries. The Stall mill achieved gold recoveries of 68% in the second quarter of 2025, reflecting benefits from recent recovery improvement programs. The Manitoba operations continued to drive operating efficiencies despite temporary disruptions from wildfire evacuations orders in June. Combined mine, mill and G&A unit operating costsi in the second quarter were C$241 per tonne, higher than the comparative period primarily due to lower total throughput in June, partially offset by continued strong cost performance at New Britannia. Mining costs were higher than in the first quarter of 2025 as a result of the wildfires in June; milling costs were higher as a result of higher unit costs at Stall associated with lower throughput as mentioned above, offset by strong unit cost performance at New Britannia. Cash costi per ounce of gold produced, net of by-product credits, in the second quarter of 2025 was $710, an increase from the first quarter of 2025 primarily due to lower gold production and lower by-product credits as per the production variances mentioned above. Sustaining cash costi per ounce of gold produced, net of by-product credits, in the second quarter of 2025 was $1,025, an increase compared to the first quarter of 2025, primarily due to the same factors affecting cash cost, partially offset by lower sustaining capital costs during the quarter. With the first half of the year outperforming the low end of the cash cost guidance range, Hudbay is well positioned to achieve the 2025 cash cost guidance range in Manitoba. On July 10, 2025, a second mandatory wildfire evacuation order was issued for the town of Snow Lake and a controlled, safe and orderly temporary suspension of the Snow Lake operations was implemented. Essential personnel, authorized by emergency services, have remained onsite when safe to do so in order to continue supporting fire mitigation activities and safeguarding Hudbay's assets. To-date, there has been no structural damage to Hudbay's onsite surface infrastructure and facilities. As of August 12, 2025, the wildfire situation near Snow Lake has improved and Hudbay anticipates returning to normal operations later in August. The Company continues to expect to achieve its 2025 annual guidance metrics for all metals in Manitoba, despite the impact from the wildfires. British Columbia Operations Review British Columbia Operations1 Three Months Ended Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Ore mined2 tonnes 2,509,969 2,648,094 2,164,722 Strip ratio3 7.50 6.73 7.61 Ore milled tonnes 2,900,008 2,760,986 3,232,427 Copper % 0.28 0.33 0.25 Gold g/tonne 0.09 0.10 0.07 Silver g/tonne 0.97 1.28 1.01 Copper recovery % 81.0 78.3 82.3 Gold recovery % 68.2 63.4 57.2 Silver recovery % 71.8 69.8 73.9 Total contained metal in concentrate Copper tonnes 6,634 7,196 6,719 Gold ounces 5,670 5,561 4,454 Silver ounces 65,040 79,480 77,227 Total payable metal sold Copper tonnes 6,803 6,153 6,564 Gold ounces 5,813 4,965 5,099 Silver ounces 67,988 60,059 69,248 Combined unit operating cost4,5 C$/tonne 24.51 25.98 19.65 Cash cost5 $/lb 2.39 2.44 2.67 Sustaining cash cost5 $/lb 5.18 4.24 5.56 1 Copper Mountain mine results are stated at 100%. On April 30, 2025, Hudbay completed the acquisition of the remaining 25% interest in the Copper Mountain mine and now owns 100%. 2 Reported tonnes and grade for ore mined are estimates based on mine plan assumptions and may not reconcile fully to ore milled. 3 Strip ratio is calculated as waste mined divided by ore mined. 4 Reflects combined mine, mill and general and administrative ("G&A") costs per tonne of ore milled. Reflects the deduction of expected capitalized stripping costs. 5 Combined unit operating cost, cash cost and sustaining cash cost per pound of copper produced, net of by-product credits, are non-GAAP financial performance measures with no standardized definition under IFRS. For further information, please see the 'Non-GAAP Financial Performance Measures' section of this news release. Hudbay continues its focus on advancing optimization plans at the Copper Mountain mine, including ramping up mining activities to optimize the mine ore feed to the plant and implementing site improvement initiatives that mirror Hudbay's successful processes at Constancia. These optimization initiatives have successfully increased the total tonnes moved and improved mill reliability. The British Columbia operations produced 6,634 tonnes of copper, 5,670 ounces of gold and 65,040 ounces of silver during the second quarter of 2025. Production of copper and silver decreased compared to the first quarter of 2025 primarily as a result of lower head grades from the use of stockpiled ore. Production of gold was higher than the first quarter of 2025, largely due to higher recoveries. Hudbay remains on track to achieve its 2025 production guidance for all metals in British Columbia and continues to expect higher production in the second half of the year as the mill improvement projects take effect. Mining activities are focused on continuing to execute the three-year accelerated stripping program intended to bring higher grade ore into the mine plan. During the first half of 2025, Hudbay made significant progress on the key mill improvement project to ultimately increase the nominal plant capacity to its permitted level of 50,000 tonnes per day. The project entails the conversion of the third ball mill to a second SAG mill, and the initial phase of this project was successfully completed shortly following the end of the second quarter on time and on budget with the achievement of first ore production on July 10. The final phase of the project involves converting an interim feed arrangement to a permanent configuration and remains on target for completion in the second half of 2025. Total ore mined at Copper Mountain in the second quarter of 2025 was 2.5 million tonnes, a 5% decrease compared to the first quarter of 2025 due to unplanned production loading fleet activities, despite an increase in total material moved in the quarter as a result of effective usage of the mining fleet to execute the accelerated stripping program to access higher grade phases in the pit. Planned ore stockpiles were utilized as ore feed to the mill while the mine operation team continued to increase waste stripping activities to expose additional ore mining fronts. The continued focus in the second quarter of 2025 was on mining efficiencies, including a significant improvement with blasted muck inventories and operator recruitment to effectively utilize the available haul truck fleet. As a result, total material moved is expected to increase quarter-over-quarter in 2025 as per the mine plan. The mill processed 2.9 million tonnes of ore during the second quarter of 2025, higher than the first quarter of 2025, but was limited by both planned and unplanned maintenance, elevated clay material which impacted the secondary crushing circuit, and the planned lowering of the main crushed live ore pile feeding the mill due to area constraints related to the completion of the ball mill to SAG conversion project. Several mill initiatives were implemented in 2025, including recovery improvements, crushing circuit chute modifications, installation of advanced semi-autogenous grinding control instrumentation, and redesigned SAG liner package. Progressive mill improvements and updated operational procedures are expected to continue through 2025. Milled copper grades during the second quarter of 2025 were lower than the first quarter due to higher amounts of ore processed from stockpile in the second quarter, as mentioned above, as well as the mining of a high-grade mining sequence during the first quarter of 2025. Copper recoveries were 81% in the second quarter of 2025, an increase from 78% in the first quarter of 2025 despite lower copper head grades. Gold recoveries of 68% in the second quarter of 2025 were higher than the first quarter of 2025, despite slightly lower gold head grades. Combined mine, mill and G&A unit operating costsi in the second quarter of 2025 were C$24.51 per tonne milled, lower than the first quarter of 2025 due to lower milling and G&A costs and higher ore milled, partially offset by higher mining costs. Cash costi and sustaining cash costi per pound of copper produced, net of by-product credits, in the second quarter of 2025 were $2.39 and $5.18, respectively. Cash costs were 2% lower than in the first quarter of 2025, largely due to higher by-product credits. Sustaining cash costs were 22% higher than the first quarter of 2025 due to higher sustaining capital including higher capitalized stripping costs. With cash costsi in the first half of the year at the low-end of the 2025 guidance range, Hudbay is well positioned to achieve the full year 2025 cash cost guidance range in British Columbia. Continued Free Cash Flow Generation from Strong Copper and Gold Exposure Hudbay has delivered eight consecutive quarters of meaningful free cash flowi generation as a result of steady operating performance, expanding margins from strong copper and gold exposure and a focus on cost control across the business: Achieved record trailing twelve-month adjusted EBITDAi of $995.9 million. Delivered more than $400 million in annual free cash flowi generation over the last twelve months. Increased cash and cash equivalents balance to $625.5 million, the highest level achieved in more than a decade. Gold continues to represent more than 36% of total revenues, which together with Hudbay's primary copper revenue business provides unique copper and gold commodity diversification. Significant Debt Reduction As a result of the continued free cash flowi generation and prudent balance sheet management, Hudbay was able to repurchase and retire $50.0 million of senior unsecured notes at a discount to par, during the second quarter of 2025. This has contributed to approximately $295 million in total debt repayments and gold prepayment liability reductions since the beginning of 2024: Repurchased and retired a total of $132.6 million of senior unsecured notes in 2024 and year-to-date 2025. Repaid $100 million of prior drawdowns under the revolving credit facilities in 2024. Fully repaid the gold prepay facility with $62.3 million in gold deliveries in 2024 and the final payment completed in August 2024. These deleveraging achievements have reduced total principal debt to $1.07 billion as of June 30, 2025, which together with Hudbay's increased cash balance, has substantially reduced net debti to $434.1 million, compared to $631.8 million as of June 30, 2024. Incorporating higher levels of adjusted EBITDAi over the last twelve months, Hudbay's net debt to adjusted EBITDA ratioi has significantly improved to 0.4x. Secured Premier Long-term Strategic Partner in Copper World JV Transaction The joint venture will be structured as a new limited liability corporation, Copper World LLC. Under the JV Transaction, the initial contribution of $600 million for a 30% equity interest in Copper World LLC, will consist of $420 million upon closing and a $180 million matching contribution payable no later than 18 months following closing. Hudbay will retain 100% of its existing U.S. federal net operating losses of approximately $275 million and Arizona state losses of $210 million. Hudbay welcomes a premier, long-term, strategic partner with deep technical expertise and a proven trading platform which Mitsubishi has established throughout its demonstrated history of industry partnerships. Mitsubishi's impressive track record in co-developing and operating some of the world's largest and highest quality copper projects will complement Hudbay's proven track record as a successful mine builder and operator. Mitsubishi will be contributing 30% of the ongoing costs beginning August 31, 2025 and will participate in the funding of the DFS as well as the final project design, project financing, and project construction for Copper World. The JV Transaction is expected to close in late 2025 or early 2026 and is conditioned upon receipt of certain regulatory approvals and the satisfaction of other customary closing conditions. Enhanced Wheaton Precious Metals Stream Hudbay is also pleased to announce that it has concurrently executed a non-binding term sheet to amend its existing Wheaton stream agreement for 100% of the gold and silver produced at Copper World (the 'Wheaton Stream'), which will increase the value of the project and provide upside exposure to higher precious metal prices. Key terms of this enhanced Wheaton Stream to include (subject to execution of definitive documentation): Up to $70 million contingent payment upon achieving potential mill expansion milestones in the future recognizing the long-term potential at Copper World. Amended ongoing payments for gold and silver from a fixed price to 15% of spot gold and silver prices providing upside exposure to higher precious metals prices. Initial $230 million stream deposit during project construction remains unchanged. Hudbay agreed to maintain existing fixed recoveries in the existing Constancia precious metals stream while Pampacancha is in production as well as provided a corporate guarantee for the existing Constancia stream in connection with the Wheaton Stream enhancement. Successfully Completed '3-P' Plan for Advancing Copper World Towards a Sanction Decision in 2026 As part of Hudbay's disciplined financial planning approach to developing Copper World, the Company implemented its 3-P plan in late 2022, including specific leverage targets that it would need to achieve prior to making an investment decision in the project: – – Hudbay received all required state level permits. – – Hudbay commenced activities related to the feasibility study for Copper World in late 2024 and expects to continue to advance definitive feasibility study activities throughout 2025 with completion by mid-2026. – – Hudbay achieved all key elements of its multi-faceted financing strategy, including: – As of June 30, 2025, Hudbay has over $625 million in cash and cash equivalents; – As of June 30, 2025, Hudbay's net debt to adjusted EBITDA ratioi is 0.4x, meaningfully below the targeted ratio to ensure financial flexibility during the sanctioning and construction of Copper World; – Announced an enhanced Wheaton Stream that aligns with the current development plan for Copper World, reflects amended ongoing payments for gold and silver deliveries from a fixed pricing to 15% of spot prices to provide upside exposure to higher precious metals prices, while also providing additional contingent payments of up to $70 million related to potential future mill expansion milestones; and, – Announced a $600 million transaction with Mitsubishi for a 30% minority joint venture interest in a highly accretive transaction, which creates a long-term partnership with a premier strategic partner that has a global mining presence and an established U.S. based metals trading business. As a result of the completion of the prudent financing strategy, Hudbay's estimated share of the remaining capital contributions for the construction of Copper World is approximately $200 millioniii, and Hudbay's first capital contribution is deferred until 2028 at the earliest based on PFS estimates. Based on Hudbay's pro-forma cash and cash equivalents of more than $1.0 billion and total liquidity of more than $1.5 billion, using figures as at June 30, 2025, the Company has significant financial flexibility to fund its share of the remaining equity contributions at Copper World while continuing to maintain a strong balance sheet throughout the project construction period. Manitoba Temporary Wildfire Evacuation Orders Since the end of May, seasonal wildfires in northern Manitoba have resulted in evacuation orders in the regions where Hudbay operates. Emergency preparedness protocols were immediately activated and Hudbay has continued to work closely with local and provincial authorities to ensure the safety and well-being of its employees and nearby communities. The first mandatory wildfire evacuation orders resulted in Hudbay temporarily suspending operations in June for 13 days and operating with a reduced workforce since the end of May, before and after the operation suspension. The Company committed over C$2 million in funding support in June, including C$1.6 million in direct financial support for evacuated Hudbay employees and a C$500,000 donation to the Canadian Red Cross to support wildfire emergency relief and rebuilding efforts in northern Manitoba. The Company's Canadian Red Cross donation was part of a collective C$1.25 million donation that was made by the three leading mining companies that operate in Manitoba, including Hudbay, Vale Base Metals and Alamos Gold Inc. In addition, Hudbay established a Community Relief Donations Fund whereby Hudbay doubled the amounts donated by its employees to the Canadian Red Cross, further multiplying the support for emergency response efforts in the region. Hudbay's Manitoba team continues to show remarkable resilience as demonstrated by the tremendous effort and unwavering commitment during this unprecedented wildfire season. They have tirelessly safeguarded the Company's assets and collaborated closely with local communities and provincial authorities, providing essential support to emergency response efforts. On July 10, 2025, a second mandatory wildfire evacuation order was issued for the town of Snow Lake and a controlled, safe and orderly temporary suspension of the Snow Lake operations was implemented. As of August 12, 2025, the wildfire situation near Snow Lake has improved and Hudbay anticipates returning to normal operations later in August. The Company continues to expect to achieve its 2025 annual guidance metrics for all metals in Manitoba, despite the temporary wildfire impacts. British Columbia Mill Optimization Project Achieves Key Milestone In July, shortly following the end of the second quarter, Hudbay reached a significant milestone on the Copper Mountain mill optimization project to convert the third ball mill to a second SAG mill. The mill project is intended to increase nominal processing capacity to its permitted capacity of 50,000 tonnes per day starting in 2026. The initial phase of the project achieved first ore production on July 10, a key milestone to ramp up mill capacity. The first phase was completed on time with more than 41,000 hours worked and zero lost-time incidents, which is a testament to the dedication and safety culture of Hudbay's team. The project remains on budget as it moves into the final phase of the project, which includes converting an interim feed arrangement to a permanent configuration and remains on track for completion in the second half of 2025. New Ingerbelle Permit Application Achieves Key Milestone On May 12, 2025, Hudbay's permitting application for the New Ingerbelle growth project at Copper Mountain was successfully accepted into review by the B.C. Major Mines Office and is now proceeding through a Mine Review Committee process. The Copper Mountain team continues ongoing engagement with First Nations and other local stakeholder groups as part of the Company's commitment to cultivating transparency and mutually beneficial relationships. Exploration Update Large Snow Lake Exploration Program Continues to Execute Threefold Strategy Hudbay continues to execute the largest exploration program in Snow Lake in the Company's history through extensive geophysical surveying and multi-phased drilling campaigns as part of Hudbay's threefold exploration strategy: – Following the positive initial step-out drilling from the exploration drift at the 1901 deposit earlier this year, Hudbay completed the development of the drift in the second quarter of 2025, and in June, the first zinc-rich ore from the 1901 mining area was delivered for processing at Stall. Activities at 1901 over the next two years will prioritize exploration, definition drilling, orebody access, and establishing critical infrastructure for full production in 2027. The additional exploration at 1901 planned for later in 2025 will target additional step-out drill holes to potentially extend the ore body and infill drilling to convert inferred mineral resources in the gold lenses to mineral reserves. The Company also expects to continue drilling down plunge of lenses 27 and 17 at Lalor once wildfire conditions improve. – Hudbay increased its regional land package by more than 250% in 2023 through the acquisition of Rockcliff Metals Corp., which included the addition of several known deposits located within trucking distance of the Snow Lake processing infrastructure. The deposits acquired as part of the Rockcliff Metals Corp. acquisition, together with several deposits already owned by Hudbay in Snow Lake, have created an attractive portfolio of regional deposits in Snow Lake, including the Talbot, Rail, Pen II, Watts, 3 Zone and WIM deposits. The continued strong performance from the New Britannia mill has freed up processing capacity at the Stall mill, where there is approximately 1,500 tonnes per day of available capacity which could be utilized by the regional satellite deposits to increase production and extend the life of the Snow Lake operations beyond 2037. Hudbay commenced an extensive summer drill program at the Talbot deposit in July focused on expanding the known mineralization and testing geophysical targets. – A majority of the land claims acquired as part of the Rockcliff Metals Corp. acquisition have been untested by modern deep geophysics, which was the discovery method for the Lalor deposit. A large geophysics program is currently underway consisting of surface electromagnetic surveys using cutting edge techniques that enable the team to detect targets at depths of almost 1,000 metres below surface. The planned geophysics program in 2025 is the largest geophysics program in Hudbay's history and includes 800 kilometres of ground electromagnetic surveys and an extensive airborne geophysics survey. The summer geophysics program is currently paused due to the regional wildfires and is expected to resume once the conditions improve and the evacuation orders are lifted. Maria Reyna and Caballito Drill Permits Update Hudbay controls a large, contiguous block of mineral rights with the potential to host satellite mineral deposits in close proximity to the Constancia processing facility, including the past producing Caballito property and the highly prospective Maria Reyna property. The Company commenced the drill permitting process at Maria Reyna and Caballito after completing a surface rights exploration agreement with the community of Uchucarcco in August 2022. As part of the drill permitting process, environmental impact assessment (EIA) applications were approved by the government in June 2024 for Maria Reyna and September 2024 for Caballito. The remaining steps in the drill permitting process include the completion by the government of the Consulta Previa consultation process with the local community. Senior Management Team Appointments In May 2025, Hudbay promoted Robert Carter to Senior Vice President, Canada and John O'Shaughnessy to Vice President, Manitoba Business Unit. In his new role, Mr. Carter is responsible for the strategic oversight of Hudbay's business activities in Manitoba and British Columbia. Mr. Carter previously held the role of Vice President, Manitoba Business Unit since April 2022 and prior to that was the General Manager of Hudbay's Manitoba mines since 2018. He has over 25 years of mining industry experience in technical, operational and senior leadership roles, with a majority of those years at Hudbay. As the new leader of the Manitoba Business Unit, Mr. O'Shaughnessy is responsible for the strategic and operational performance of Hudbay's activities in Manitoba. He previously held the role of Vice President, Business Development at Hudbay where he provided expert oversight and strategic leadership of the global mine planning process. He has over 25 years of mining industry experience, including numerous progressive engineering, operational and leadership roles at Vale's mining operations in Ontario and Newfoundland and Labrador. Dividend Declared A semi-annual dividend of C$0.01 per share was declared on August 12, 2025. The dividend will be paid out on September 19, 2025 to shareholders of record as of close of business on September 2, 2025. Website Links Hudbay: Management's Discussion and Analysis: Financial Statements: Conference Call and Webcast Date: Wednesday, August 13, 2025 Time: 11:00 a.m. ET Webcast: Dial in: 647-846-8185 or 1-833-752-3516 Qualified Person and NI 43-101 The technical and scientific information in this news release related to all of Hudbay's material mineral projects other than the Copper Mountain mine has been approved by Olivier Tavchandjian, P. Geo., Senior Vice President, Exploration and Technical Services. The technical and scientific information in this news release related to the Copper Mountain mine has been approved by Marc-Andre Brulotte, P. Geo., Director, Global Exploration and Resource Evaluation. Messrs. Tavchandjian and Brulotte are qualified persons pursuant to NI 43‑101. For a description of the key assumptions, parameters and methods used to estimate mineral reserves and resources at Hudbay's material mineral properties, as well as data verification procedures and a general discussion of the extent to which the estimates of scientific and technical information may be affected by any known environmental, permitting, legal title, taxation, sociopolitical, marketing or other relevant factors, please see the technical reports for the Company's material properties are available on SEDAR+ at and EDGAR at Non-GAAP Financial Performance Measures Adjusted net earnings (loss) attributable to owners, adjusted net earnings (loss) per share attributable to owners, adjusted EBITDA, net debt, net debt to adjusted EBITDA, free cash flow, cash cost, sustaining and all-in sustaining cash cost per pound of copper produced, cash cost and sustaining cash cost per ounce of gold produced, combined unit cost and ratios based on these measures are non-GAAP performance measures. These measures do not have a meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other issuers. These measures should not be considered in isolation or as a substitute for measures prepared in accordance with IFRS and are not necessarily indicative of operating profit or cash flow from operations as determined under IFRS. Other companies may calculate these measures differently. Management believes adjusted net earnings (loss) attributable to owners and adjusted net earnings (loss) per share attributable to owners provides an alternate measure of the Company's performance for the current period and gives insight into its expected performance in future periods. These measures are used internally by the Company to evaluate the performance of its underlying operations and to assist with its planning and forecasting of future operating results. As such, the Company believes these measures are useful to investors in assessing the Company's underlying performance. Hudbay provides adjusted EBITDA to help users analyze the Company's results and to provide additional information about its ongoing cash generating potential in order to assess its capacity to service and repay debt, carry out investments and cover working capital needs. Net debt is shown because it is a performance measure used by the Company to assess its financial position. Net debt to adjusted EBITDA is shown because it is a performance measure used by the Company to assess its financial leverage and debt capacity. Free cash flow is shown as it provides investors and management additional information in assessing the Company's ability to generate cash flow from current operations after investing in capital to sustain the operations. Cash cost, sustaining and all-in sustaining cash cost per pound of copper produced are shown because the Company believes they help investors and management assess the performance of its operations, including the margin generated by the operations and the Company. Cash cost and sustaining cash cost per ounce of gold produced are shown because the Company believes they help investors and management assess the performance of its Manitoba operations. Combined unit cost is shown because Hudbay believes it helps investors and management assess the Company's cost structure and margins that are not impacted by variability in by-product commodity prices. The following tables provide detailed reconciliations to the most comparable IFRS measures. Adjusted Net Earnings (Loss) Reconciliation Three Months Ended (in $ millions) Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Net earnings for the period 114.7 99.2 (20.3 ) Tax expense 38.4 72.1 20.7 Earnings before tax 153.1 171.3 0.4 Adjusting items: Mark-to-market adjustments1 6.3 (3.1 ) 19.5 Foreign exchange (gain) loss (18.9 ) (3.1 ) 2.1 Re-evaluation adjustment - environmental provision (13.8 ) 12.8 (2.7 ) Manitoba cost of sales and other expense from temporary shutdown 5.3 — — Variable consideration adjustment - stream revenue and accretion — (10.5 ) — Inventory adjustments 3.5 1.2 — Reduction of obligation to renounce flow-through share expenditures, net of provisions (1.2 ) (1.9 ) (0.3 ) Restructuring charges — 0.1 0.3 Write-down/loss on disposal of PP&E 0.3 0.6 2.1 Changes in other provisions (non-capital) — 0.7 — Adjusted earnings before income taxes 134.6 168.1 21.4 Tax expense (38.4 ) (72.1 ) (20.7 ) Tax impact on adjusting items (23.0 ) (2.8 ) (2.4 ) Adjusted net earnings 73.2 93.2 (1.7 ) Adjusted net earnings attributable to non-controlling interest: Net loss for the period 3.0 1.2 3.8 Adjusting items, including tax impact (0.7 ) (0.6 ) (1.9 ) Adjusted net earnings - attributable to owners 75.5 93.8 0.2 Adjusted net earnings ($/share) - attributable to owners 0.19 0.24 0.00 Basic weighted average number of common shares outstanding (millions) 395.1 395.0 368.3 1 Includes changes in fair value of the gold prepayment liability, Canadian junior mining investments, other financial assets and liabilities at fair value through net earnings and share-based compensation (recoveries) expenses. Also includes gains and losses on disposition of investments. Adjusted EBITDA Reconciliation Three Months Ended (in $ millions) Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Net earnings for the period 114.7 99.2 (20.3 ) Add back: Tax expense 38.4 72.1 20.7 Net finance expense — 14.4 44.3 Other expenses 7.1 5.2 11.2 Depreciation and amortization 96.4 108.1 97.6 Amortization of deferred revenue and variable consideration adjustment (15.4 ) (29.3 ) (11.5 ) Adjusting items (pre-tax): Re-evaluation adjustment - environmental provision (13.8 ) 12.8 (2.7 ) Inventory adjustments 3.5 1.2 — Manitoba cost of sales charge from temporary shutdown. 3.2 — — Option agreement proceeds (Marubeni) 1.0 1.5 — Realized loss on non-QP hedges (0.4 ) (1.9 ) (2.6 ) Share-based compensation expenses1 10.5 3.9 8.3 Adjusted EBITDA 245.2 287.2 145.0 1 Share-based compensation expenses reflected in cost of sales and selling and administrative Debt Reconciliation (in $ millions) Jun. 30, 2025 Mar. 31, 2025 Dec. 31, 2024 Total debt 1,059.6 1,108.7 1,107.5 Less: Cash and cash equivalents (625.5 ) (562.6 ) (541.8 ) Less: Short-term investments — (20.0 ) (40.0 ) Net debt 434.1 526.1 525.7 (in $ millions, except net debt to adjusted EBITDA ratio) Net debt 434.1 526.1 525.7 Adjusted EBITDA (12-month period) 995.9 895.7 823.3 Net debt to adjusted EBITDA 0.4 0.6 0.6 Trailing Adjusted EBITDA Three Months Ended (in $ millions) Jun. 30,2025 Mar. 31,2025 Dec. 31,2024 Sept. 30,2024 Jun. 30,2024 Earnings (loss) for the period 114.7 99.2 19.3 50.4 (20.4 ) Add back: Tax expense 38.4 72.1 84.4 29.3 20.8 Net finance expense — 14.4 34.4 26.0 44.3 Other expenses 7.1 5.2 22.1 7.9 11.2 Depreciation and amortization 96.4 108.1 122.2 97.5 97.6 Amortization of deferred revenue and variable consideration adjustment (15.4 ) (29.3 ) (26.2 ) (9.5 ) (11.5 ) Adjusting items (pre-tax): Re-evaluation adjustment - environmental provision (13.8 ) 12.8 2.5 2.0 (2.7 ) Inventory adjustments 3.5 1.2 1.3 1.6 — Cash portion of Manitoba cost of sales direct charge from temporary shutdown 3.2 — — — — Realized loss on non-QP hedges (0.4 ) (1.9 ) (4.2 ) (2.1 ) (2.6 ) Option agreement proceeds (Marubeni) 1.0 1.5 — — — Share-based compensation expenses1 10.5 3.9 1.5 3.1 8.3 Adjusted EBITDA 245.2 287.2 257.3 206.2 145.0 LTM2 995.9 895.7 823.3 1 Share-based compensation expense reflected in cost of sales and administrative expenses. 2 LTM (last twelve months) as of June 30, 2025, March 31, 2025 and December 31, 2024. Annual consolidated results may not be calculated based on the amounts presented in this table due to Cash Flow Reconciliation (in $ millions) Three Months Ended Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Cash generated from operations 259.9 124.8 140.2 Adjusting items: Change in non-cash working capital 66.0 (38.7 ) 16.5 Cash sustaining capital expenditures1 106.1 76.1 91.2 Free cash flow 87.8 87.4 32.5 Cash sustaining capital expenditures1 Total sustaining capital costs 88.6 62.5 80.9 Capitalized lease and equipment financing cash payments - operating sites 13.4 12.8 9.6 Community agreement cash payments 4.1 0.8 0.7 Cash sustaining capital expenditures1 106.1 76.1 91.2 Three Months Ended LTM2 (in $ millions) Jun. 30,2025 Mar. 31,2025 Dec. 31,2024 Sept. 30,2024 Cash generated from operations 259.9 124.8 238.1 148.2 771.0 Adjusting items: Change in non-cash working capital 66.0 (38.7 ) 6.6 (40.1 ) (6.2 ) Cash sustaining capital expenditures1 106.1 76.1 82.6 99.9 364.7 Free cash flow 87.8 87.4 148.9 88.4 412.5 Cash sustaining capital expenditures1 Total sustaining capital costs 88.6 62.5 71.6 89.4 312.1 Capitalized lease and equipment financing cash payments - operating sites 13.4 12.8 10.3 10.2 46.7 Community agreement cash payments 4.1 0.8 0.7 0.3 5.9 Cash sustaining capital expenditures1 106.1 76.1 82.6 99.9 364.7 1 Excludes amortization of decommissioning and restoration PP&E assets and accretion of decommissioning and restoration liabilities related to producing sites. 2 LTM (last twelve months) as at June 30, 2025Copper Cash Cost Reconciliation Consolidated Three Months Ended Net pounds of copper produced1 (in thousands) Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Peru 47,863 44,738 42,366 Manitoba 3,554 7,648 5,825 British Columbia 14,626 15,864 14,813 Net pounds of copper produced 66,043 68,250 63,004 1 Contained copper in Three Months Ended Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Cash cost per pound of copper produced $ millions $/lb $ millions $/lb $ millions $/lb Mining 85.8 1.30 91.2 1.34 93.1 1.47 Milling 92.6 1.40 80.6 1.18 88.0 1.40 G&A 43.1 0.66 43.6 0.64 35.3 0.56 Onsite costs 221.5 3.36 215.4 3.16 216.4 3.43 Treatment & refining 3.3 0.05 14.0 0.21 22.5 0.36 Freight & other 20.8 0.31 24.3 0.35 21.8 0.34 Cash cost, before by-product credits 245.6 3.72 253.7 3.72 260.7 4.13 By-product credits (247.3 ) (3.74 ) (284.7 ) (4.17 ) (188.7 ) (2.99 ) Cash cost, net of by-product credits (1.7 ) (0.02 ) (31.0 ) (0.45 ) 72.0 1.14 Consolidated Three Months Ended Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Supplementary cash cost information $ millions $/lb1 $ millions $/lb1 $ millions $/lb1 By-product credits2: Zinc 7.3 0.11 13.8 0.20 14.9 0.23 Gold3 195.8 2.96 225.4 3.30 136.2 2.16 Silver3 23.4 0.35 26.1 0.38 18.1 0.29 Molybdenum & other 20.8 0.32 19.4 0.29 19.5 0.31 Total by-product credits 247.3 3.74 284.7 4.17 188.7 2.99 Reconciliation to IFRS: Cash cost, net of by-product credits (1.7 ) (31.0 ) 72.0 By-product credits 247.3 284.7 188.7 Treatment and refining charges (3.3 ) (14.0 ) (22.5 ) Share-based compensation expense 0.9 0.7 0.6 Inventory adjustments 3.5 1.2 — Change in product inventory 11.4 12.0 10.0 Royalties 2.2 1.9 1.5 Overhead costs incurred during temporary suspension 3.2 — — Depreciation and amortization3 96.4 108.1 97.6 Cost of sales 359.9 363.6 347.9 1 Per pound of copper produced. 2 By-product credits are computed as revenue per consolidated financial statements, including amortization of deferred revenue and pricing and volume adjustments. 3 Gold and silver by-product credits do not include variable consideration adjustments with respect to stream arrangements. Variable consideration adjustments are cumulative adjustments to gold and silver stream deferred revenue primarily associated with the net change in mineral reserves and resources or amendments to the mine plan that would change the total expected deliverable ounces under the precious metal streaming arrangement. For the three months ended June 30, 2025 the variable consideration adjustments amounted to $nil (three months ended June 30, 2024 - $nil and March 31, 2025 - gain of $9.9 million). 4 Depreciation is based on concentrate Three Months Ended (in thousands) Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Net pounds of copper produced1 47,863 44,738 42,366 1 Contained copper in Three Months Ended Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Cash cost per pound of copper produced $ millions $/lb $ millions $/lb $ millions $/lb Mining 28.1 0.59 31.0 0.69 31.3 0.74 Milling 57.8 1.21 44.4 0.99 51.3 1.21 G&A 23.2 0.48 22.5 0.51 19.4 0.46 Onsite costs 109.1 2.28 97.9 2.19 102.0 2.41 Treatment & refining (0.1 ) (0.00 ) 6.7 0.15 11.1 0.26 Freight & other 12.4 0.25 15.2 0.34 12.6 0.30 Cash cost, before by-product credits 121.4 2.53 119.8 2.68 125.7 2.97 By-product credits (51.8 ) (1.08 ) (70.2 ) (1.57 ) (50.3 ) (1.19 ) Cash cost, net of by-product credits 69.6 1.45 49.6 1.11 75.4 1.78 Peru Three Months Ended Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Supplementary cash cost information $ millions $/lb1 $ millions $/lb1 $ millions $/lb1 By-product credits2: Gold3 17.3 0.36 35.0 0.78 21.6 0.51 Silver3 13.7 0.29 15.6 0.35 9.7 0.23 Molybdenum 20.8 0.43 19.6 0.44 19.0 0.45 Total by-product credits 51.8 1.08 70.2 1.57 50.3 1.19 Reconciliation to IFRS: Cash cost, net of by-product credits 69.6 49.6 75.4 By-product credits 51.8 70.2 50.3 Treatment and refining charges 0.1 (6.7 ) (11.1 ) Inventory adjustments 1.1 0.4 — Share-based compensation expenses 0.2 0.1 0.2 Change in product inventory 4.0 13.8 1.1 Royalties 1.0 1.1 0.9 Depreciation and amortization4 56.0 68.2 58.9 Cost of sales5 183.8 196.7 175.7 1 Per pound of copper produced. 2 By-product credits are computed as revenue per consolidated financial statements, including amortization of deferred revenue and pricing and volume adjustments. 3 Gold and silver by-product credits do not include variable consideration adjustments with respect to stream arrangements. 4 Depreciation is based on concentrate sold. 5 As per the consolidated financial Columbia Three Months Ended (in thousands) Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Net pounds of copper produced1 14,626 15,864 14,813 1 Contained copper in Columbia Three Months Ended Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Cash cost per pound of copper produced $ millions $/lb $ millions $/lb $ millions $/lb Mining 24.2 1.65 21.9 1.38 19.5 1.31 Milling 21.4 1.46 21.8 1.37 21.5 1.45 G&A 6.1 0.42 6.3 0.40 5.4 0.37 Onsite costs 51.7 3.53 50.0 3.15 46.4 3.13 Treatment & refining 2.1 0.14 3.6 0.23 4.2 0.29 Freight & other 3.3 0.24 3.4 0.21 3.5 0.23 Cash cost, before by-product credits 57.1 3.91 57.0 3.59 54.1 3.65 By-product credits (22.2 ) (1.52 ) (18.3 ) (1.15 ) (14.5 ) (0.98 ) Cash cost, net of by-product credits 34.9 2.39 38.7 2.44 39.6 2.67 British Columbia Three Months Ended Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Supplementary cash cost information $ millions $/lb1 $ millions $/lb1 $ millions $/lb1 By-product credits2: Gold 19.8 1.35 16.1 1.01 12.2 0.82 Silver 2.4 0.17 2.2 0.14 2.3 0.16 Total by-product credits 22.2 1.52 18.3 1.15 14.5 0.98 Reconciliation to IFRS: Cash cost, net of by-product credits 34.9 38.7 39.6 By-product credits 22.2 18.3 14.5 Treatment and refining charges (2.1 ) (3.6 ) (4.2 ) Share based payment 0.2 0.3 — Change in product inventory 3.6 (0.8 ) 11.3 Inventory adjustments 1.4 0.8 — Royalties 1.2 0.8 0.6 Depreciation and amortization3 16.8 16.0 14.0 Cost of sales4 78.2 70.5 75.8 1 Per pound of copper produced. 2 By-product credits are computed as revenue per consolidated financial statements, including amortization of deferred revenue and pricing and volume adjustments. 3 Depreciation is based on concentrate sold. 4 As per consolidated financial and All-in Sustaining Cash Cost Reconciliation Consolidated Three Months Ended Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 All-in sustaining cash cost per pound of copper produced $ millions $/lb $ millions $/lb $ millions $/lb Cash cost, net of by-product credits (1.7 ) (0.02 ) (31.0 ) (0.45 ) 72.0 1.14 Cash sustaining capital expenditures 108.3 1.64 78.2 1.14 93.0 1.48 Royalties 2.2 0.03 1.9 0.03 1.5 0.03 Sustaining cash cost, net of by-product credits 108.8 1.65 49.1 0.72 166.5 2.65 Corporate selling and administrative expenses & regional costs 22.1 0.33 15.3 0.22 19.8 0.32 Accretion and amortization of decommissioning and community agreements1 3.2 0.05 2.0 0.03 6.6 0.10 All-in sustaining cash cost, net of by-product credits 134.1 2.03 66.4 0.97 192.9 3.07 Reconciliation to property, plant and equipment additions Property, plant and equipment additions 93.6 68.2 75.2 Capitalized stripping net additions 53.8 41.3 43.4 Total accrued capital additions 147.4 109.5 118.6 Less other non-sustaining capital costs2 58.8 47.0 37.7 Total sustaining capital costs 88.6 62.5 80.9 Capitalized lease & equipment financing cash payments - operating sites 13.4 12.8 9.6 Community agreement cash payments 4.1 0.8 0.7 Accretion and amortization of decommissioning and restoration obligations3 2.2 2.1 1.8 Cash sustaining capital expenditures 108.3 78.2 93.0 1 Includes accretion of decommissioning relating to non-productive sites, and accretion and amortization of community agreements capitalized to Other assets. 2 Other non-sustaining capital costs include Arizona capitalized costs, capitalized interest, capitalized exploration, right-of-use lease asset additions, equipment financing asset additions, growth capital expenditures and reclassification related to capital spares. 3 Includes amortization of decommissioning and restoration PP&E assets and accretion of decommissioning and restoration liabilities related to producing Three Months Ended Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Sustaining cash cost per pound of copper produced $ millions $/lb $ millions $/lb $ millions $/lb Cash cost, net of by-product credits 69.6 1.45 49.6 1.11 75.4 1.78 Cash sustaining capital expenditures 55.1 1.15 35.3 0.79 33.8 0.80 Royalties 1.0 0.03 1.1 0.02 0.9 0.02 Sustaining cash cost per pound of copper produced 125.7 2.63 86.0 1.92 110.1 2.60 British Columbia Three Months Ended Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Sustaining cash cost per pound of copper produced $ millions $/lb $ millions $/lb $ millions $/lb Cash cost, net of by-product credits 34.9 2.39 38.7 2.44 39.6 2.67 Cash sustaining capital expenditures 39.6 2.71 27.8 1.75 42.1 2.84 Royalties 1.2 0.08 0.8 0.05 0.6 0.05 Sustaining cash cost per pound of copper produced 75.7 5.18 67.3 4.24 82.3 5.56 Gold Cash Cost and Sustaining Cash Cost Reconciliation Manitoba Three Months Ended (in thousands) Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Net ounces of gold produced1 43,235 60,354 43,488 1 Contained gold in concentrate and doré.Manitoba Three Months Ended Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Cash cost per ounce of gold produced $millions $/oz $millions $/oz $millions $/oz Mining 33.5 775 38.3 634 42.3 973 Milling 13.4 310 14.4 239 15.2 350 G&A 13.8 319 14.8 245 10.5 240 Onsite costs 60.7 1,404 67.5 1,118 68.0 1,563 Treatment & refining 1.3 30 3.7 61 7.2 167 Freight & other 5.1 118 5.7 95 5.7 130 Cash cost, before by-product credits 67.1 1,552 76.9 1,274 80.9 1,860 By-product credits (36.4 ) (842 ) (54.2 ) (898 ) (47.4 ) (1,090 ) Gold cash cost, net of by-product credits 30.7 710 22.7 376 33.5 771 Manitoba Three Months Ended Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Supplementary cash cost information $millions $/oz1 $millions $/oz1 $millions $/oz1 By-product credits2: Copper 21.8 504 32.3 535 25.9 596 Zinc 7.3 169 13.8 228 14.9 343 Silver 7.3 169 8.3 138 6.1 140 Other — — (0.2 ) (3 ) 0.5 11 Total by-product credits 36.4 842 54.2 898 47.4 1,090 Reconciliation to IFRS: Cash cost, net of by-product credits 30.7 22.7 33.5 By-product credits 36.4 54.2 47.4 Treatment and refining charges (1.3 ) (3.7 ) (7.2 ) Inventory adjustments 1.0 — — Past service cost — — — Share-based compensation expenses 0.5 0.3 0.4 Change in product inventory 3.8 (1.0 ) (2.4 ) Overhead costs incurred during temporary suspension 3.2 — — Depreciation and amortization3 23.6 23.9 24.7 Cost of sales4 97.9 96.4 96.4 1 Per ounce of gold produced. 2 By-product credits are computed as revenue per consolidated financial statements, amortization of deferred revenue, pricing and volume adjustments. 3 Depreciation is based on concentrate sold. 4 As per consolidated financial Three Months Ended Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Sustaining cash cost per pound of gold produced $millions $/oz $millions $/oz $millions $/oz Gold cash cost, net of by-product credits 30.7 710 22.7 376 33.5 771 Cash sustaining capital expenditures 13.6 315 15.1 250 17.1 392 Sustaining cash cost per pound of gold produced 44.3 1,025 37.8 626 50.6 1,163 Combined Unit Cost Reconciliation Peru Three Months Ended (in millions except ore tonnes milled and unit cost per tonne) Combined unit cost per tonne processed Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Mining 28.1 31.0 31.3 Milling 57.8 44.4 51.3 G&A1 23.2 22.5 19.4 Other G&A2 (6.4 ) (7.9 ) (4.1 ) Unit cost 102.7 90.0 97.9 Tonnes ore milled 7,559 8,114 7,719 Combined unit cost per tonne 13.59 11.09 12.68 Reconciliation to IFRS: Unit cost 102.7 90.0 97.9 Freight & other 12.4 15.2 12.6 Inventory adjustments 1.1 0.4 — Other G&A 6.4 7.9 4.1 Share-based compensation expenses 0.2 0.1 0.2 Change in product inventory 4.0 13.8 1.1 Royalties 1.0 1.1 0.9 Depreciation and amortization 56.0 68.2 58.9 Cost of sales3 183.8 196.7 175.7 1 G&A as per cash cost reconciliation above. 2 Other G&A primarily includes profit sharing costs. 3 As per consolidated financial Columbia Three Months Ended (in millions except tonnes ore milled and unit cost per tonne) Combined unit cost per tonne processed Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Mining 24.2 21.9 19.5 Milling 21.4 21.8 21.5 G&A1 6.1 6.3 5.4 Unit cost 51.7 50.0 46.4 USD/CAD implicit exchange rate 1.38 1.43 1.36 Unit cost - C$ 71.1 71.7 63.5 Tonnes ore milled 2,900 2,761 3,232 Combined unit cost per tonne – C$ 24.51 25.98 19.65 Reconciliation to IFRS: Unit cost 51.7 50.0 46.4 Freight & other 3.3 3.4 3.5 Share-based compensation expenses 0.2 0.3 — Change in product inventory 3.6 (0.8 ) 11.3 Inventory adjustments 1.4 0.8 — Royalties 1.2 0.8 0.6 Depreciation and amortization 16.8 16.0 14.0 Cost of sales2 78.2 70.5 75.8 1 G&A as per cash cost reconciliation above 2 As per consolidated interim financial Three Months Ended (in millions except ore tonnes milled and unit cost per tonne) Combined unit cost per tonne processed Jun. 30, 2025 Mar. 31, 2025 Jun. 30, 2024 Mining 33.5 38.3 42.3 Milling 13.4 14.4 15.2 G&A1 13.8 14.8 10.5 Less: Other G&A related to profit sharing costs (7.2 ) (7.2 ) (3.4 ) Unit cost 53.5 60.3 64.6 USD/CAD implicit exchange rate 1.38 1.43 1.38 Unit cost - C$ 73.9 86.5 89.3 Tonnes ore milled 307,138 404,410 397,426 Combined unit cost per tonne2 - C$ 241 214 225 Reconciliation to IFRS: Unit cost 53.5 60.3 64.6 Freight & other 5.1 5.7 5.7 Other G&A related to profit sharing 7.2 7.2 3.4 Share-based compensation expenses 0.5 0.3 0.4 Inventory adjustments 1.0 — — Change in product inventory 3.8 (1.0 ) (2.4 ) Overhead costs incurred during temporary suspension 3.2 — — Depreciation and amortization 23.6 23.9 24.7 Cost of sales3 97.9 96.4 96.4 1 G&A as per cash cost reconciliation above. 2 Excludes $3.2 million (C$14 per tonne) of overhead costs incurred during temporary suspension during the three months ended June 30, 2025. 3 As per consolidated interim financial Information This news release contains forward-looking information within the meaning of applicable Canadian and United States securities legislation. All information contained in this news release, other than statements of current and historical fact, is forward-looking information. Often, but not always, forward-looking information can be identified by the use of words such as 'plans', 'expects', 'budget', 'guidance', 'scheduled', 'estimates', 'forecasts', 'strategy', 'target', 'intends', 'objective', 'goal', 'understands', 'anticipates' and 'believes' (and variations of these or similar words) and statements that certain actions, events or results 'may', 'could', 'would', 'should', 'might' 'occur' or 'be achieved' or 'will be taken' (and variations of these or similar expressions). All of the forward-looking information in this news release is qualified by this cautionary note. Forward-looking information includes, but is not limited to, statements with respect to Hudbay's production, cost and capital and exploration expenditure guidance, and the potential impact thereon from wildfires and any related evacuation or government orders in Manitoba and British Columbia or social unrest in Peru, the Snow Lake operations' ability to ramp up to full production in a timely manner after its suspension of operations, expectations regarding reductions in discretionary spending and capital expenditures, Hudbay's ability to advance and complete the optimization of the Copper Mountain mine operation including with respect to the ongoing SAG mill conversion and configuration project, the implementation of stripping strategies and the expected benefits therefrom, the estimated timelines and pre-requisites for sanctioning the Copper World project, the consummation and timing of the JV Transaction, the satisfaction of the conditions precedent to the JV Transaction, including but not limited to receipt of regulatory approvals, expectations regarding the anticipated benefits of the JV Transaction to Hudbay, and the United States, the consummation and timing of the DFS, expectations regarding the results of any challenges to the permits for the Copper World project and the potential impact of recent policy decisions from the United States government, the expected benefits of the sanctioning of Copper World project, and the benefits, timing and consummation of the amended Wheaton Stream, the expected benefits of Manitoba growth initiatives, including the use of the exploration drift at the 1901 deposit, and the potential utilization of excess capacity at the Stall mill, Hudbay's future deleveraging strategies and Hudbay's ability to deleverage and repay debt as needed, expectations regarding Hudbay's cash balance and liquidity, expectations regarding tax synergies, expectations regarding the ability to conduct exploration work and execute on exploration programs on its properties and to advance related drill plans, including the advancement of the exploration program at Maria Reyna and Caballito and the status and anticipated timing of the related drill permit application process, expectations regarding the prospective nature of the Maria Reyna and Caballito properties, the ability to continue mining higher-grade ore in the Pampacancha pit and Hudbay's expectations resulting therefrom, Hudbay's evaluation and assessment of opportunities to reprocess tailings using various metallurgical technologies, the anticipated impact of brownfield and greenfield growth projects on Hudbay's performance, anticipated expansion opportunities and extension of mine life in Snow Lake and Hudbay's ability to find a new anchor deposit near Hudbay's Snow Lake operations, anticipated future drill programs and exploration activities and any results expected therefrom, anticipated mine plans, anticipated metals prices and the anticipated sensitivity of Hudbay's financial performance to metals prices, events that may affect Hudbay's operations and development projects, anticipated cash flows from operations and related liquidity requirements, the anticipated effect of external factors on revenue, such as commodity prices, estimation of mineral reserves and resources, mine life projections, reclamation costs, economic outlook, government regulation of mining operations, and business and acquisition strategies. Forward-looking information is not, and cannot be, a guarantee of future results or events. Forward-looking information is based on, among other things, opinions, assumptions, estimates and analyses that, while considered reasonable by Hudbay at the date the forward-looking information is provided, inherently are subject to significant risks, uncertainties, contingencies and other factors that may cause actual results and events to be materially different from those expressed or implied by the forward-looking information. The material factors or assumptions that Hudbay has identified and were applied in drawing conclusions or making forecasts or projections set out in the forward-looking information include, but are not limited to: the ability to achieve production, cost and capital and exploration expenditure guidance; no significant interruptions to Hudbay's operations due to social or political unrest in the regions Hudbay operates, including the navigation of the complex political and social environment in Peru and the resolution of grievances raised by local communities and their residents; the ability to ramp up to full production in a timely manner following the suspension of operations in Manitoba; the closing of the JV Transaction; no interruptions to Hudbay's plans for advancing the Copper World project, including with respect to any successful challenges to the Copper World permits; Hudbay's ability to successfully advance and complete the optimization of the Copper Mountain operations, obtain required permits and develop and maintain good relations with key stakeholders; the ability to execute on its exploration plans and to advance related drill plans; the ability to advance the exploration program at the Maria Reyna and Caballito properties; the success of mining, processing, exploration and development activities; the scheduled maintenance and availability of Hudbay's processing facilities; the accuracy of geological, mining and metallurgical estimates; anticipated metals prices and the costs of production; the supply and demand for metals Hudbay produces; the supply and availability of all forms of energy and fuels at reasonable prices; no significant unanticipated operational or technical difficulties; no significant interruptions to operations due to adverse effects from extreme weather events, including forest fires that have affected and may continue to affect the regions in which Hudbay operates; the execution of Hudbay's business and growth strategies, including the success of its strategic investments and initiatives; the availability of additional financing, if needed; the ability to deleverage and repay debt, as needed; the ability to complete project targets on time and on budget and other events that may affect Hudbay's ability to develop Hudbay's projects; the timing and receipt of various regulatory and governmental approvals; the availability of personnel for Hudbay's exploration, development and operational projects and ongoing employee relations; maintaining good relations with the employees at Hudbay's operations; maintaining good relations with the labour unions that represent certain of Hudbay employees in Manitoba and Peru; maintaining good relations with the communities in which Hudbay operates, including the neighbouring Indigenous communities and local governments; no significant unanticipated challenges with stakeholders at Hudbay's various projects; no significant unanticipated events or changes relating to regulatory, environmental, health and safety matters; no contests over title to Hudbay's properties, including as a result of rights or claimed rights of Indigenous peoples or challenges to the validity of Hudbay's unpatented mining claims; the timing and possible outcome of pending litigation and no significant unanticipated litigation; certain tax matters, including, but not limited to current tax laws and regulations, changes in taxation policies and the refund of certain value added taxes from the Canadian and Peruvian governments; and no significant and continuing adverse changes in general economic conditions or conditions in the financial markets (including commodity prices and foreign exchange rates). The risks, uncertainties, contingencies and other factors that may cause actual results to differ materially from those expressed or implied by the forward-looking information may include, but are not limited to, risks associated with satisfying the conditions to the closing of the JV Transaction, including the timing, receipt and any conditions associated with regulatory approvals, risks associated with reaching a definitive agreement with Wheaton in respect of the enhanced precious metals stream, risks related to the failure to effectively advance and complete the optimization of the Copper Mountain mine operations including with respect to the ongoing SAG mill conversion and configuration project, political and social risks in the regions Hudbay operates, including the complex political and social environment in Peru and potential disruptions to operations arising from community protests and grievances, risks generally associated with the mining industry and the current geopolitical environment, including future commodity prices, the potential implementation or expansion of tariffs, currency and interest rate fluctuations, energy and consumable prices, supply chain constraints and general cost escalation in the current inflationary environment, uncertainties related to the development and operation of Hudbay's projects, the risk of an indicator of impairment or impairment reversal relating to a material mineral property, risks related to the Copper World project, including in relation to project delivery and financing risks, risks related to the Lalor mine plan, including the ability to convert inferred mineral resource estimates to higher confidence categories, dependence on key personnel and employee and union relations, risks related to political or social instability, unrest or change, risks in respect of Indigenous and community relations, rights and title claims, operational risks and hazards, including the cost of maintaining and upgrading Hudbay's tailings management facilities and any unanticipated environmental, industrial and geological events and developments and the inability to insure against all risks (including any unanticipated significant interruptions to operations due to adverse effects from extreme weather events), failure of plant, equipment, processes, transportation and other infrastructure to operate as anticipated, compliance with government and environmental regulations, including permitting requirements and anti-bribery legislation, depletion of Hudbay's reserves, volatile financial markets and interest rates that may affect Hudbay's ability to obtain additional financing on acceptable terms, the failure to obtain required approvals or clearances from government authorities on a timely basis, uncertainties related to the geology, continuity, grade and estimates of mineral reserves and resources, and the potential for variations in grade and recovery rates, uncertain costs of reclamation activities, Hudbay's ability to comply with Hudbay's pension and other post-retirement obligations, Hudbay's ability to abide by the covenants in Hudbay's debt instruments and other material contracts, tax refunds, hedging transactions, as well as the risks discussed under the heading 'Risk Factors' in Hudbay's most recent Annual Information Form which is available on the Company's SEDAR+ profile at and the Company's EDGAR profile at Should one or more risk, uncertainty, contingency or other factor materialize or should any factor or assumption prove incorrect, actual results could vary materially from those expressed or implied in the forward-looking information. Accordingly, you should not place undue reliance on forward-looking information. Hudbay does not assume any obligation to update or revise any forward-looking information after the date of this news release or to explain any material difference between subsequent actual events and any forward-looking information, except as required by applicable law. Note to United States Investors This news release has been prepared in accordance with the requirements of the securities laws in effect in Canada, which may differ materially from the requirements of United States securities laws applicable to U.S. issuers. About Hudbay Hudbay (TSX, NYSE: HBM) is a copper-focused critical minerals mining company with three long-life operations and a world-class pipeline of copper growth projects in tier-one mining jurisdictions of Canada, Peru and the United States. Hudbay's operating portfolio includes the Constancia mine in Cusco (Peru), the Snow Lake operations in Manitoba (Canada) and the Copper Mountain mine in British Columbia (Canada). Copper is the primary metal produced by the Company, which is complemented by meaningful gold production and by-product zinc, silver and molybdenum. Hudbay's growth pipeline includes the Copper World project in Arizona (United States), the Mason project in Nevada (United States), the Llaguen project in La Libertad (Peru) and several expansion and exploration opportunities near its existing operations. The value Hudbay creates and the impact it has is embodied in its purpose statement: 'We care about our people, our communities and our planet. Hudbay provides the metals the world needs. We work sustainably, transform lives and create better futures for communities.' Hudbay's mission is to create sustainable value and strong returns by leveraging its core strengths in community relations, focused exploration, mine development and efficient operations. For further information, please contact: Candace Brûlé Vice President, Investor Relations, Financial Analysis and External Communications (416) 814-4387 ____________________ i Adjusted net earnings (loss) - attributable to owners and adjusted net earnings (loss) per share - attributable to owners, adjusted EBITDA, cash cost, sustaining cash cost, all-in sustaining cash cost per pound of copper produced, net of by-product credits, cash cost, sustaining cash cost per ounce of gold produced, net of by-product credits, combined unit cost, net debt, net debt to adjusted EBITDA ratio and free cash flow are non-GAAP financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the 'Non-GAAP Financial Performance Measures' section of this news release. ii Average analyst consensus net asset value estimate for 100% of Copper World is approximately $1.16 billion as of August 12, 2025. iii Based on the initial capital investment and the $3.75 per pound copper price used in the PFS published on September 8, 2023 with assumptions of approximately $145 million for pre-sanctioning costs, $230 million from the precious metals stream, $350 million from project-level financing and approximately $700 million from the joint venture partner earn-in, matching contribution and capital contribution. iv Copper Mountain copper production comparison based on the mid-point of the 2027 guidance range compared to 2024 in to access your portfolio
Associated Press
3 days ago
- Business
- Associated Press
Hudbay Delivers Strong Second Quarter 2025 Results
TORONTO, Aug. 13, 2025 (GLOBE NEWSWIRE) -- Hudbay Minerals Inc. ('Hudbay' or the 'Company') (TSX, NYSE: HBM) today released its second quarter 2025 financial results. All amounts are in U.S. dollars, unless otherwise noted. 'We delivered another quarter of significant free cash flow generation driven by continued industry-leading cost margins and diversified exposure to copper and gold,' said Peter Kukielski, President and Chief Executive Officer. 'Our strong financial performance enabled us to further reduce long-term debt, invest in our many high-return growth projects and further strengthen our balance sheet to its best position in over a decade. With the strong performance in the first half of the year, we are reaffirming our full year consolidated production guidance and are favourably tracking well below our full year consolidated cost guidance for 2025. The announcement of our Copper World joint venture agreement with Mitsubishi further solidifies our financial strength and significantly reduces our funding requirement for project development. We are delighted to have secured the premier joint venture partner and look forward to establishing a long-term strategic partnership that will unlock significant value in our copper growth pipeline. Through a highly accretive joint venture, an agreement to enhance the Copper World precious metals stream terms, and the achievement of our financial targets, we have successfully realized the key elements of our prudent financial plan and significantly de-risked the Copper World project as we advance towards a sanction decision in 2026.' Delivered Strong Second Quarter Financial Results; Production Reaffirmed and Cost Guidance Improved Continued Free Cash Flow Generation Driving Further Debt Reduction and Balance Sheet Resilience Prudently Advancing Copper World with Accretive Minority Joint Venture Transaction, Enhanced Stream Transaction and Successful Achievement of '3-P' Plan Reinvesting in High-return Growth Initiatives to Further Enhance Copper and Gold Exposure Summary of Second Quarter Results Steady production continued into the second quarter of 2025 with consolidated copper production of 29,956 tonnes and consolidated gold production of 56,271 ounces. Consolidated copper and gold production was lower than the first quarter of 2025 primarily due to the impacts of a temporary suspension of operations in Manitoba as a result of mandatory wildfire evacuation orders. Consolidated silver production of 814,989 ounces and zinc production of 5,130 tonnes in the second quarter of 2025 were also lower than the first quarter of 2025 for the aforementioned reason. Cash generated from operating activities of $259.9 million increased compared to the first quarter of 2025 as a result of higher gross margins driven by stable copper production, higher realized prices and positive working capital management with reductions in finished goods inventories and receivable balances. Operating cash flow before change in non-cash working capital was $193.9 million during the second quarter of 2025, reflecting an increase of $30.4 million compared to the first quarter of 2025. The increase compared to the first quarter of 2025 was primarily the result of lower cash taxes paid offset by lower gold and copper sales volume in Manitoba. Second quarter adjusted EBITDAi was $245.2 million, a 15% decrease compared to $287.2 million in the first quarter of 2025 due to lower sales volume partially offset by higher gold prices. Net earnings attributable to owners in the second quarter of 2025 was $117.7 million, or $0.30 per share, compared to $100.4 million, or $0.25 per share, in the first quarter of 2025. The increase in earnings is the result of high gross margins from strong revenue growth on the back of stable copper production and higher realized gold prices. In addition, the quarter benefited from various non-cash charges for revaluation gain of closed sites reclamation provisions, and significantly reduced net finance expenses, among other items, more than offsetting the high mining and income tax expense experienced in the current quarter. Adjusted net earnings attributable to ownersi and adjusted net earnings per share attributable to ownersi in the second quarter of 2025 were $75.5 million and $0.19 per share, respectively, after adjusting for various non-cash items on a pre-tax basis such as a non-cash $18.9 million foreign exchange gain, a non-cash gain of $13.8 million related to quarterly revaluation of Hudbay's closed site environmental reclamation provision, a $6.3 million mark-to-market revaluation gain on various instruments such as investments and share-based compensation, and a $1.2 million gain related to flow-through share expenditures, among other items. This compares to adjusted net earnings attributable to ownersi and net earnings per share attributable to ownersi of $93.8 million and $0.24 per share in the first quarter of 2025. In the second quarter of 2025, consolidated cash costi per pound of copper produced, net of by-product credits, was $(0.02), compared to $(0.45) in the first quarter of 2025 as the Company continued to demonstrate industry-leading cost performance. The change from the first quarter was a result of lower by-product credits and lower production levels in Manitoba during the second quarter. Consolidated sustaining cash costi per pound of copper produced, net of by-product credits, was $1.65 in the second quarter of 2025, compared to $0.72 in the first quarter of 2025. The increase was driven by planned higher sustaining capital expenditures and the aforementioned variance in cash cost. Consolidated all-in sustaining cash costi per pound of copper produced, net of by-product credits, was $2.03 in the second quarter of 2025, higher than $0.97 in the first quarter of 2025 mainly due to the same reasons outlined above as well as higher corporate G&A from the revaluation of the Company's stock based compensation due to relative higher share prices. As at June 30, 2025, total liquidity was $1,050.2 million, including $625.5 million in cash and cash equivalents, and undrawn availability of $424.7 million under Hudbay's revolving credit facilities. Net debti at the end of the second quarter was $434.1 million, marking a $92.0 million improvement from the first quarter of 2025 as a result of deleveraging activities. Peru Operations Review The Peru operations continued to demonstrate steady operating performance with production and costs in line with expectations. During the second quarter of 2025, the Peru operations produced 21,710 tonnes of copper, 7,366 ounces of gold, 551,979 ounces of silver and 375 tonnes of molybdenum. Copper production increased in the second quarter of 2025 compared to the first quarter of 2025 as milled copper grades exceeded first quarter levels, partially offset by planned lower mill throughput due to a scheduled mill maintenance shutdown in the second quarter. Production of all other metals were relatively in line with the first quarter of 2025. The last major stripping program at Pampacancha was completed in the second quarter of 2025, which included higher amounts of waste stripping than planned. As a result, the Company replaced higher grade Pampacancha ore with higher grade Constancia ore in the second quarter and the Pampacancha deposit is now expected to be depleted in the first quarter of 2026 rather than in late 2025. Protests that started early in the third quarter temporarily impacted the transportation of supplies and concentrate to and from the Constancia site and has affected mine sequencing. The Constancia mill has continued to operate during this period, and the road blockades along the concentrate transportation route have since reopened, allowing Hudbay to reduce site concentrate inventory levels and replenish supplies. Despite short-term mine plan changes, the Company remains on track to achieve its 2025 production guidance for all metals in Peru. Total ore mined in Peru in the second quarter of 2025 was lower than the first quarter of 2025 but remained in line with mine plan expectations. Mill throughput levels averaged approximately 83,100 tonnes per day in the second quarter of 2025, lower than the first quarter of 2025 due to the planned semi-annual mill maintenance shutdown during the current quarter. Milled copper grades increased by 13% relative to the first quarter of 2025 due to higher grades in the Constancia pit. Milled gold grades in the second quarter remained consistent with gold grades in the first quarter of 2025 as Pampacancha stripping activities were underway in both quarters. The mill achieved copper recoveries of 85% in the second quarter of 2025, remaining consistent with the first quarter of 2025. Recoveries of gold and silver during the quarter were in line with Hudbay's metallurgical models for the ore that was being processed. Combined mine, mill and G&A unit operating costi in the second quarter of 2025 was $13.59 per tonne, 23% higher than the first quarter, as expected, due to higher plant maintenance costs and lower tonnes processed associated with the planned semi-annual mill maintenance shutdown. Cash costi per pound of copper produced, net of by-product credits, in the second quarter of 2025 was $1.45, an increase of 31% compared to the first quarter of 2025 due to planned higher maintenance costs and lower by-product credits, partially offset by lower treatment and refining charges and higher copper production. Sustaining cash costi per pound of copper produced, net of by-product credits, was $2.63 in the second quarter of 2025, an increase compared to the first quarter of 2025 due to planned higher sustaining capital typically associated with the period after the rainy season is complete, as well as the same factors affecting cash costs. Hudbay is reaffirming its full year 2025 cash cost guidance range in Peru. Manitoba Operations Review Despite significant disruptions from the mandatory wildfire evacuation orders in May and June of this year, the Manitoba operations showed remarkable resilience and achieved several key milestones in the second quarter of 2025. Notably, the New Britannia mill achieved record monthly production in April, the 1901 mining area delivered its first ore for processing in June, and Hudbay signed an exploration agreement with Mosakahiken Cree Nation to explore the Talbot deposit. The Manitoba operations delivered strong results in the second quarter of 2025, producing 43,235 ounces of gold, 1,612 tonnes of copper, 5,130 tonnes of zinc and 197,970 ounces of silver. Compared to the first quarter of 2025, production of gold, copper, silver and zinc in the second quarter of 2025 decreased by 28%, 54%, 31% and 18%, respectively, due to lower production in June associated with the wildfire evacuation shutdown, in addition to the first quarter of 2025 having significantly better than expected gold grades. Hudbay's dedicated on-site team demonstrated tremendous effort and unwavering commitment during the unprecedented wildfire situation near the Company's Flin Flon and Snow Lake operations during the second quarter. The team tirelessly safeguarded Hudbay's assets and collaborated closely with local communities and provincial authorities, providing essential support to emergency response efforts. These efforts resulted in no damage to Hudbay's infrastructure and facilities. The Lalor mine managed through a period of reduced workforce prior to and after the 13-day temporary suspension of operations in June due to mandatory wildfire evacuation orders. Despite these challenges, the mine averaged 3,300 tonnes per day in the second quarter, strategically prioritizing mining from gold zones to ensure a consistent feed for the New Britannia mill. Gold grades were in line with mine plan expectations, while being lower than the exceptional gold grade mined in the first quarter of 2025. Copper, zinc and silver grades were also consistent with mine plan expectations for the quarter. Continuous improvement efforts at Lalor focused on ore quality and advancing stope modifications to enhance mucking productivity. Capital development continued, aiming to secure high-grade copper-gold mineralization from Zone 27 and prepare Zone 17 for the next copper-gold mining front. The New Britannia mill achieved record monthly production levels in April, exceeding 2,300 tonnes per day. This significant milestone is a testament to ongoing low-capital projects and recent piping improvements that boosted throughput and maintained gold recoveries. The New Britannia mill throughput averaged approximately 1,800 tonnes per day in the second quarter of 2025, reflecting the record levels achieved in April, offset by lower throughput levels in June associated with the wildfire evacuation shutdown. Gold recovery in the second quarter of 2025 was 89%, remaining relatively consistent with the first quarter of 2025. In the second quarter, the Stall mill continued to process less ore compared to prior periods, which is aligned with Hudbay's strategy of allocating more Lalor ore feed to New Britannia to maximize gold recoveries. The Stall mill achieved gold recoveries of 68% in the second quarter of 2025, reflecting benefits from recent recovery improvement programs. The Manitoba operations continued to drive operating efficiencies despite temporary disruptions from wildfire evacuations orders in June. Combined mine, mill and G&A unit operating costsi in the second quarter were C$241 per tonne, higher than the comparative period primarily due to lower total throughput in June, partially offset by continued strong cost performance at New Britannia. Mining costs were higher than in the first quarter of 2025 as a result of the wildfires in June; milling costs were higher as a result of higher unit costs at Stall associated with lower throughput as mentioned above, offset by strong unit cost performance at New Britannia. Cash costi per ounce of gold produced, net of by-product credits, in the second quarter of 2025 was $710, an increase from the first quarter of 2025 primarily due to lower gold production and lower by-product credits as per the production variances mentioned above. Sustaining cash costi per ounce of gold produced, net of by-product credits, in the second quarter of 2025 was $1,025, an increase compared to the first quarter of 2025, primarily due to the same factors affecting cash cost, partially offset by lower sustaining capital costs during the quarter. With the first half of the year outperforming the low end of the cash cost guidance range, Hudbay is well positioned to achieve the 2025 cash cost guidance range in Manitoba. On July 10, 2025, a second mandatory wildfire evacuation order was issued for the town of Snow Lake and a controlled, safe and orderly temporary suspension of the Snow Lake operations was implemented. Essential personnel, authorized by emergency services, have remained onsite when safe to do so in order to continue supporting fire mitigation activities and safeguarding Hudbay's assets. To-date, there has been no structural damage to Hudbay's onsite surface infrastructure and facilities. As of August 12, 2025, the wildfire situation near Snow Lake has improved and Hudbay anticipates returning to normal operations later in August. The Company continues to expect to achieve its 2025 annual guidance metrics for all metals in Manitoba, despite the impact from the wildfires. British Columbia Operations Review Hudbay continues its focus on advancing optimization plans at the Copper Mountain mine, including ramping up mining activities to optimize the mine ore feed to the plant and implementing site improvement initiatives that mirror Hudbay's successful processes at Constancia. These optimization initiatives have successfully increased the total tonnes moved and improved mill reliability. The British Columbia operations produced 6,634 tonnes of copper, 5,670 ounces of gold and 65,040 ounces of silver during the second quarter of 2025. Production of copper and silver decreased compared to the first quarter of 2025 primarily as a result of lower head grades from the use of stockpiled ore. Production of gold was higher than the first quarter of 2025, largely due to higher recoveries. Hudbay remains on track to achieve its 2025 production guidance for all metals in British Columbia and continues to expect higher production in the second half of the year as the mill improvement projects take effect. Mining activities are focused on continuing to execute the three-year accelerated stripping program intended to bring higher grade ore into the mine plan. During the first half of 2025, Hudbay made significant progress on the key mill improvement project to ultimately increase the nominal plant capacity to its permitted level of 50,000 tonnes per day. The project entails the conversion of the third ball mill to a second SAG mill, and the initial phase of this project was successfully completed shortly following the end of the second quarter on time and on budget with the achievement of first ore production on July 10. The final phase of the project involves converting an interim feed arrangement to a permanent configuration and remains on target for completion in the second half of 2025. Total ore mined at Copper Mountain in the second quarter of 2025 was 2.5 million tonnes, a 5% decrease compared to the first quarter of 2025 due to unplanned production loading fleet activities, despite an increase in total material moved in the quarter as a result of effective usage of the mining fleet to execute the accelerated stripping program to access higher grade phases in the pit. Planned ore stockpiles were utilized as ore feed to the mill while the mine operation team continued to increase waste stripping activities to expose additional ore mining fronts. The continued focus in the second quarter of 2025 was on mining efficiencies, including a significant improvement with blasted muck inventories and operator recruitment to effectively utilize the available haul truck fleet. As a result, total material moved is expected to increase quarter-over-quarter in 2025 as per the mine plan. The mill processed 2.9 million tonnes of ore during the second quarter of 2025, higher than the first quarter of 2025, but was limited by both planned and unplanned maintenance, elevated clay material which impacted the secondary crushing circuit, and the planned lowering of the main crushed live ore pile feeding the mill due to area constraints related to the completion of the ball mill to SAG conversion project. Several mill initiatives were implemented in 2025, including recovery improvements, crushing circuit chute modifications, installation of advanced semi-autogenous grinding control instrumentation, and redesigned SAG liner package. Progressive mill improvements and updated operational procedures are expected to continue through 2025. Milled copper grades during the second quarter of 2025 were lower than the first quarter due to higher amounts of ore processed from stockpile in the second quarter, as mentioned above, as well as the mining of a high-grade mining sequence during the first quarter of 2025. Copper recoveries were 81% in the second quarter of 2025, an increase from 78% in the first quarter of 2025 despite lower copper head grades. Gold recoveries of 68% in the second quarter of 2025 were higher than the first quarter of 2025, despite slightly lower gold head grades. Combined mine, mill and G&A unit operating costsi in the second quarter of 2025 were C$24.51 per tonne milled, lower than the first quarter of 2025 due to lower milling and G&A costs and higher ore milled, partially offset by higher mining costs. Cash costi and sustaining cash costi per pound of copper produced, net of by-product credits, in the second quarter of 2025 were $2.39 and $5.18, respectively. Cash costs were 2% lower than in the first quarter of 2025, largely due to higher by-product credits. Sustaining cash costs were 22% higher than the first quarter of 2025 due to higher sustaining capital including higher capitalized stripping costs. With cash costsi in the first half of the year at the low-end of the 2025 guidance range, Hudbay is well positioned to achieve the full year 2025 cash cost guidance range in British Columbia. Continued Free Cash Flow Generation from Strong Copper and Gold Exposure Hudbay has delivered eight consecutive quarters of meaningful free cash flowi generation as a result of steady operating performance, expanding margins from strong copper and gold exposure and a focus on cost control across the business: Significant Debt Reduction As a result of the continued free cash flowi generation and prudent balance sheet management, Hudbay was able to repurchase and retire $50.0 million of senior unsecured notes at a discount to par, during the second quarter of 2025. This has contributed to approximately $295 million in total debt repayments and gold prepayment liability reductions since the beginning of 2024: These deleveraging achievements have reduced total principal debt to $1.07 billion as of June 30, 2025, which together with Hudbay's increased cash balance, has substantially reduced net debti to $434.1 million, compared to $631.8 million as of June 30, 2024. Incorporating higher levels of adjusted EBITDAi over the last twelve months, Hudbay's net debt to adjusted EBITDA ratioi has significantly improved to 0.4x. Secured Premier Long-term Strategic Partner in Copper World JV Transaction The joint venture will be structured as a new limited liability corporation, Copper World LLC. Under the JV Transaction, the initial contribution of $600 million for a 30% equity interest in Copper World LLC, will consist of $420 million upon closing and a $180 million matching contribution payable no later than 18 months following closing. Hudbay will retain 100% of its existing U.S. federal net operating losses of approximately $275 million and Arizona state losses of $210 million. Hudbay welcomes a premier, long-term, strategic partner with deep technical expertise and a proven trading platform which Mitsubishi has established throughout its demonstrated history of industry partnerships. Mitsubishi's impressive track record in co-developing and operating some of the world's largest and highest quality copper projects will complement Hudbay's proven track record as a successful mine builder and operator. Mitsubishi will be contributing 30% of the ongoing costs beginning August 31, 2025 and will participate in the funding of the DFS as well as the final project design, project financing, and project construction for Copper World. The JV Transaction is expected to close in late 2025 or early 2026 and is conditioned upon receipt of certain regulatory approvals and the satisfaction of other customary closing conditions. Enhanced Wheaton Precious Metals Stream Hudbay is also pleased to announce that it has concurrently executed a non-binding term sheet to amend its existing Wheaton stream agreement for 100% of the gold and silver produced at Copper World (the 'Wheaton Stream'), which will increase the value of the project and provide upside exposure to higher precious metal prices. Key terms of this enhanced Wheaton Stream to include (subject to execution of definitive documentation): Successfully Completed '3-P' Plan for Advancing Copper World Towards a Sanction Decision in 2026 As part of Hudbay's disciplined financial planning approach to developing Copper World, the Company implemented its 3-P plan in late 2022, including specific leverage targets that it would need to achieve prior to making an investment decision in the project: As a result of the completion of the prudent financing strategy, Hudbay's estimated share of the remaining capital contributions for the construction of Copper World is approximately $200 millioniii, and Hudbay's first capital contribution is deferred until 2028 at the earliest based on PFS estimates. Based on Hudbay's pro-forma cash and cash equivalents of more than $1.0 billion and total liquidity of more than $1.5 billion, using figures as at June 30, 2025, the Company has significant financial flexibility to fund its share of the remaining equity contributions at Copper World while continuing to maintain a strong balance sheet throughout the project construction period. Manitoba Temporary Wildfire Evacuation Orders Since the end of May, seasonal wildfires in northern Manitoba have resulted in evacuation orders in the regions where Hudbay operates. Emergency preparedness protocols were immediately activated and Hudbay has continued to work closely with local and provincial authorities to ensure the safety and well-being of its employees and nearby communities. The first mandatory wildfire evacuation orders resulted in Hudbay temporarily suspending operations in June for 13 days and operating with a reduced workforce since the end of May, before and after the operation suspension. The Company committed over C$2 million in funding support in June, including C$1.6 million in direct financial support for evacuated Hudbay employees and a C$500,000 donation to the Canadian Red Cross to support wildfire emergency relief and rebuilding efforts in northern Manitoba. The Company's Canadian Red Cross donation was part of a collective C$1.25 million donation that was made by the three leading mining companies that operate in Manitoba, including Hudbay, Vale Base Metals and Alamos Gold Inc. In addition, Hudbay established a Community Relief Donations Fund whereby Hudbay doubled the amounts donated by its employees to the Canadian Red Cross, further multiplying the support for emergency response efforts in the region. Hudbay's Manitoba team continues to show remarkable resilience as demonstrated by the tremendous effort and unwavering commitment during this unprecedented wildfire season. They have tirelessly safeguarded the Company's assets and collaborated closely with local communities and provincial authorities, providing essential support to emergency response efforts. On July 10, 2025, a second mandatory wildfire evacuation order was issued for the town of Snow Lake and a controlled, safe and orderly temporary suspension of the Snow Lake operations was implemented. As of August 12, 2025, the wildfire situation near Snow Lake has improved and Hudbay anticipates returning to normal operations later in August. The Company continues to expect to achieve its 2025 annual guidance metrics for all metals in Manitoba, despite the temporary wildfire impacts. British Columbia Mill Optimization Project Achieves Key Milestone In July, shortly following the end of the second quarter, Hudbay reached a significant milestone on the Copper Mountain mill optimization project to convert the third ball mill to a second SAG mill. The mill project is intended to increase nominal processing capacity to its permitted capacity of 50,000 tonnes per day starting in 2026. The initial phase of the project achieved first ore production on July 10, a key milestone to ramp up mill capacity. The first phase was completed on time with more than 41,000 hours worked and zero lost-time incidents, which is a testament to the dedication and safety culture of Hudbay's team. The project remains on budget as it moves into the final phase of the project, which includes converting an interim feed arrangement to a permanent configuration and remains on track for completion in the second half of 2025. New Ingerbelle Permit Application Achieves Key Milestone On May 12, 2025, Hudbay's permitting application for the New Ingerbelle growth project at Copper Mountain was successfully accepted into review by the B.C. Major Mines Office and is now proceeding through a Mine Review Committee process. The Copper Mountain team continues ongoing engagement with First Nations and other local stakeholder groups as part of the Company's commitment to cultivating transparency and mutually beneficial relationships. Exploration Update LargeSnow Lake Exploration Program Continues to Execute Threefold Strategy Hudbay continues to execute the largest exploration program in Snow Lake in the Company's history through extensive geophysical surveying and multi-phased drilling campaigns as part of Hudbay's threefold exploration strategy: Maria Reyna and Caballito Drill Permits Update Hudbay controls a large, contiguous block of mineral rights with the potential to host satellite mineral deposits in close proximity to the Constancia processing facility, including the past producing Caballito property and the highly prospective Maria Reyna property. The Company commenced the drill permitting process at Maria Reyna and Caballito after completing a surface rights exploration agreement with the community of Uchucarcco in August 2022. As part of the drill permitting process, environmental impact assessment (EIA) applications were approved by the government in June 2024 for Maria Reyna and September 2024 for Caballito. The remaining steps in the drill permitting process include the completion by the government of the Consulta Previa consultation process with the local community. Senior Management Team Appointments In May 2025, Hudbay promoted Robert Carter to Senior Vice President, Canada and John O'Shaughnessy to Vice President, Manitoba Business Unit. In his new role, Mr. Carter is responsible for the strategic oversight of Hudbay's business activities in Manitoba and British Columbia. Mr. Carter previously held the role of Vice President, Manitoba Business Unit since April 2022 and prior to that was the General Manager of Hudbay's Manitoba mines since 2018. He has over 25 years of mining industry experience in technical, operational and senior leadership roles, with a majority of those years at Hudbay. As the new leader of the Manitoba Business Unit, Mr. O'Shaughnessy is responsible for the strategic and operational performance of Hudbay's activities in Manitoba. He previously held the role of Vice President, Business Development at Hudbay where he provided expert oversight and strategic leadership of the global mine planning process. He has over 25 years of mining industry experience, including numerous progressive engineering, operational and leadership roles at Vale's mining operations in Ontario and Newfoundland and Labrador. Dividend Declared A semi-annual dividend of C$0.01 per share was declared on August 12, 2025. The dividend will be paid out on September 19, 2025 to shareholders of record as of close of business on September 2, 2025. Website Links Hudbay: Management's Discussion and Analysis: Financial Statements: Conference Call and Webcast Qualified Person and NI 43-101 The technical and scientific information in this news release related to all of Hudbay's material mineral projects other than the Copper Mountain mine has been approved by Olivier Tavchandjian, P. Geo., Senior Vice President, Exploration and Technical Services. The technical and scientific information in this news release related to the Copper Mountain mine has been approved by Marc-Andre Brulotte, P. Geo., Director, Global Exploration and Resource Evaluation. Messrs. Tavchandjian and Brulotte are qualified persons pursuant to NI 43‑101. For a description of the key assumptions, parameters and methods used to estimate mineral reserves and resources at Hudbay's material mineral properties, as well as data verification procedures and a general discussion of the extent to which the estimates of scientific and technical information may be affected by any known environmental, permitting, legal title, taxation, sociopolitical, marketing or other relevant factors, please see the technical reports for the Company's material properties are available on SEDAR+ at and EDGAR at Non-GAAP Financial Performance Measures Adjusted net earnings (loss) attributable to owners, adjusted net earnings (loss) per share attributable to owners, adjusted EBITDA, net debt, net debt to adjusted EBITDA, free cash flow, cash cost, sustaining and all-in sustaining cash cost per pound of copper produced, cash cost and sustaining cash cost per ounce of gold produced, combined unit cost and ratios based on these measures are non-GAAP performance measures. These measures do not have a meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other issuers. These measures should not be considered in isolation or as a substitute for measures prepared in accordance with IFRS and are not necessarily indicative of operating profit or cash flow from operations as determined under IFRS. Other companies may calculate these measures differently. Management believes adjusted net earnings (loss) attributable to owners and adjusted net earnings (loss) per share attributable to owners provides an alternate measure of the Company's performance for the current period and gives insight into its expected performance in future periods. These measures are used internally by the Company to evaluate the performance of its underlying operations and to assist with its planning and forecasting of future operating results. As such, the Company believes these measures are useful to investors in assessing the Company's underlying performance. Hudbay provides adjusted EBITDA to help users analyze the Company's results and to provide additional information about its ongoing cash generating potential in order to assess its capacity to service and repay debt, carry out investments and cover working capital needs. Net debt is shown because it is a performance measure used by the Company to assess its financial position. Net debt to adjusted EBITDA is shown because it is a performance measure used by the Company to assess its financial leverage and debt capacity. Free cash flow is shown as it provides investors and management additional information in assessing the Company's ability to generate cash flow from current operations after investing in capital to sustain the operations. Cash cost, sustaining and all-in sustaining cash cost per pound of copper produced are shown because the Company believes they help investors and management assess the performance of its operations, including the margin generated by the operations and the Company. Cash cost and sustaining cash cost per ounce of gold produced are shown because the Company believes they help investors and management assess the performance of its Manitoba operations. Combined unit cost is shown because Hudbay believes it helps investors and management assess the Company's cost structure and margins that are not impacted by variability in by-product commodity prices. The following tables provide detailed reconciliations to the most comparable IFRS measures. Adjusted Net Earnings (Loss) Reconciliation Adjusted EBITDA Reconciliation Net Debt Reconciliation Free Cash Flow Reconciliation Copper Cash Cost Reconciliation Sustaining and All-in Sustaining Cash Cost Reconciliation Gold Cash Cost and Sustaining Cash Cost Reconciliation Combined Unit Cost Reconciliation Forward-Looking Information This news release contains forward-looking information within the meaning of applicable Canadian and United States securities legislation. All information contained in this news release, other than statements of current and historical fact, is forward-looking information. Often, but not always, forward-looking information can be identified by the use of words such as 'plans', 'expects', 'budget', 'guidance', 'scheduled', 'estimates', 'forecasts', 'strategy', 'target', 'intends', 'objective', 'goal', 'understands', 'anticipates' and 'believes' (and variations of these or similar words) and statements that certain actions, events or results 'may', 'could', 'would', 'should', 'might' 'occur' or 'be achieved' or 'will be taken' (and variations of these or similar expressions). All of the forward-looking information in this news release is qualified by this cautionary note. Forward-looking information includes, but is not limited to, statements with respect to Hudbay's production, cost and capital and exploration expenditure guidance, and the potential impact thereon from wildfires and any related evacuation or government orders in Manitoba and British Columbia or social unrest in Peru, the Snow Lake operations' ability to ramp up to full production in a timely manner after its suspension of operations, expectations regarding reductions in discretionary spending and capital expenditures, Hudbay's ability to advance and complete the optimization of the Copper Mountain mine operation including with respect to the ongoing SAG mill conversion and configuration project, the implementation of stripping strategies and the expected benefits therefrom, the estimated timelines and pre-requisites for sanctioning the Copper World project, the consummation and timing of the JV Transaction, the satisfaction of the conditions precedent to the JV Transaction, including but not limited to receipt of regulatory approvals, expectations regarding the anticipated benefits of the JV Transaction to Hudbay, and the United States, the consummation and timing of the DFS, expectations regarding the results of any challenges to the permits for the Copper World project and the potential impact of recent policy decisions from the United States government, the expected benefits of the sanctioning of Copper World project, and the benefits, timing and consummation of the amended Wheaton Stream, the expected benefits of Manitoba growth initiatives, including the use of the exploration drift at the 1901 deposit, and the potential utilization of excess capacity at the Stall mill, Hudbay's future deleveraging strategies and Hudbay's ability to deleverage and repay debt as needed, expectations regarding Hudbay's cash balance and liquidity, expectations regarding tax synergies, expectations regarding the ability to conduct exploration work and execute on exploration programs on its properties and to advance related drill plans, including the advancement of the exploration program at Maria Reyna and Caballito and the status and anticipated timing of the related drill permit application process, expectations regarding the prospective nature of the Maria Reyna and Caballito properties, the ability to continue mining higher-grade ore in the Pampacancha pit and Hudbay's expectations resulting therefrom, Hudbay's evaluation and assessment of opportunities to reprocess tailings using various metallurgical technologies, the anticipated impact of brownfield and greenfield growth projects on Hudbay's performance, anticipated expansion opportunities and extension of mine life in Snow Lake and Hudbay's ability to find a new anchor deposit near Hudbay's Snow Lake operations, anticipated future drill programs and exploration activities and any results expected therefrom, anticipated mine plans, anticipated metals prices and the anticipated sensitivity of Hudbay's financial performance to metals prices, events that may affect Hudbay's operations and development projects, anticipated cash flows from operations and related liquidity requirements, the anticipated effect of external factors on revenue, such as commodity prices, estimation of mineral reserves and resources, mine life projections, reclamation costs, economic outlook, government regulation of mining operations, and business and acquisition strategies. Forward-looking information is not, and cannot be, a guarantee of future results or events. Forward-looking information is based on, among other things, opinions, assumptions, estimates and analyses that, while considered reasonable by Hudbay at the date the forward-looking information is provided, inherently are subject to significant risks, uncertainties, contingencies and other factors that may cause actual results and events to be materially different from those expressed or implied by the forward-looking information. The material factors or assumptions that Hudbay has identified and were applied in drawing conclusions or making forecasts or projections set out in the forward-looking information include, but are not limited to: The risks, uncertainties, contingencies and other factors that may cause actual results to differ materially from those expressed or implied by the forward-looking information may include, but are not limited to, risks associated with satisfying the conditions to the closing of the JV Transaction, including the timing, receipt and any conditions associated with regulatory approvals, risks associated with reaching a definitive agreement with Wheaton in respect of the enhanced precious metals stream, risks related to the failure to effectively advance and complete the optimization of the Copper Mountain mine operations including with respect to the ongoing SAG mill conversion and configuration project, political and social risks in the regions Hudbay operates, including the complex political and social environment in Peru and potential disruptions to operations arising from community protests and grievances, risks generally associated with the mining industry and the current geopolitical environment, including future commodity prices, the potential implementation or expansion of tariffs, currency and interest rate fluctuations, energy and consumable prices, supply chain constraints and general cost escalation in the current inflationary environment, uncertainties related to the development and operation of Hudbay's projects, the risk of an indicator of impairment or impairment reversal relating to a material mineral property, risks related to the Copper World project, including in relation to project delivery and financing risks, risks related to the Lalor mine plan, including the ability to convert inferred mineral resource estimates to higher confidence categories, dependence on key personnel and employee and union relations, risks related to political or social instability, unrest or change, risks in respect of Indigenous and community relations, rights and title claims, operational risks and hazards, including the cost of maintaining and upgrading Hudbay's tailings management facilities and any unanticipated environmental, industrial and geological events and developments and the inability to insure against all risks (including any unanticipated significant interruptions to operations due to adverse effects from extreme weather events), failure of plant, equipment, processes, transportation and other infrastructure to operate as anticipated, compliance with government and environmental regulations, including permitting requirements and anti-bribery legislation, depletion of Hudbay's reserves, volatile financial markets and interest rates that may affect Hudbay's ability to obtain additional financing on acceptable terms, the failure to obtain required approvals or clearances from government authorities on a timely basis, uncertainties related to the geology, continuity, grade and estimates of mineral reserves and resources, and the potential for variations in grade and recovery rates, uncertain costs of reclamation activities, Hudbay's ability to comply with Hudbay's pension and other post-retirement obligations, Hudbay's ability to abide by the covenants in Hudbay's debt instruments and other material contracts, tax refunds, hedging transactions, as well as the risks discussed under the heading 'Risk Factors' in Hudbay's most recent Annual Information Form which is available on the Company's SEDAR+ profile at and the Company's EDGAR profile at Should one or more risk, uncertainty, contingency or other factor materialize or should any factor or assumption prove incorrect, actual results could vary materially from those expressed or implied in the forward-looking information. Accordingly, you should not place undue reliance on forward-looking information. Hudbay does not assume any obligation to update or revise any forward-looking information after the date of this news release or to explain any material difference between subsequent actual events and any forward-looking information, except as required by applicable law. Note to United States Investors This news release has been prepared in accordance with the requirements of the securities laws in effect in Canada, which may differ materially from the requirements of United States securities laws applicable to U.S. issuers. About Hudbay Hudbay (TSX, NYSE: HBM) is a copper-focused critical minerals mining company with three long-life operations and a world-class pipeline of copper growth projects in tier-one mining jurisdictions of Canada, Peru and the United States. Hudbay's operating portfolio includes the Constancia mine in Cusco (Peru), the Snow Lake operations in Manitoba (Canada) and the Copper Mountain mine in British Columbia (Canada). Copper is the primary metal produced by the Company, which is complemented by meaningful gold production and by-product zinc, silver and molybdenum. Hudbay's growth pipeline includes the Copper World project in Arizona (United States), the Mason project in Nevada (United States), the Llaguen project in La Libertad (Peru) and several expansion and exploration opportunities near its existing operations. The value Hudbay creates and the impact it has is embodied in its purpose statement: 'We care about our people, our communities and our planet. Hudbay provides the metals the world needs. We work sustainably, transform lives and create better futures for communities.' Hudbay's mission is to create sustainable value and strong returns by leveraging its core strengths in community relations, focused exploration, mine development and efficient operations. For further information, please contact: Candace Brûlé Vice President, Investor Relations, Financial Analysis and External Communications (416) 814-4387 [email protected] ____________________ i Adjusted net earnings (loss) - attributable to owners and adjusted net earnings (loss) per share - attributable to owners, adjusted EBITDA, cash cost, sustaining cash cost, all-in sustaining cash cost per pound of copper produced, net of by-product credits, cash cost, sustaining cash cost per ounce of gold produced, net of by-product credits, combined unit cost, net debt, net debt to adjusted EBITDA ratio and free cash flow are non-GAAP financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the 'Non-GAAP Financial Performance Measures' section of this news release. ii Average analyst consensus net asset value estimate for 100% of Copper World is approximately $1.16 billion as of August 12, 2025. iii Based on the initial capital investment and the $3.75 per pound copper price used in the PFS published on September 8, 2023 with assumptions of approximately $145 million for pre-sanctioning costs, $230 million from the precious metals stream, $350 million from project-level financing and approximately $700 million from the joint venture partner earn-in, matching contribution and capital contribution. iv Copper Mountain copper production comparison based on the mid-point of the 2027 guidance range compared to 2024 actuals.
Bloomberg
3 days ago
- Business
- Bloomberg
Mitsubishi Corp. to Invest $600 Million in HudBay Copper Project
Mitsubishi Corp. has agreed to pay $600 million for a 30% stake in a proposed US copper project being developed by HudBay Minerals Inc. 'Securing Mitsubishi as a 30% partner in Copper World is an important milestone for Hudbay as we establish a long-term strategic partnership to advance this high-quality copper project towards sanctioning and to unlock significant value in our copper growth portfolio,' Hudbay Chief Executive Officer Peter Kukielski said Wednesday in a statement.
Associated Press
12-05-2025
- Business
- Associated Press
Hudbay Delivers Strong First Quarter 2025 Results Driven by Gold Production and Record Cost Performance
TORONTO, May 12, 2025 (GLOBE NEWSWIRE) -- Hudbay Minerals Inc. ('Hudbay' or the 'Company') (TSX, NYSE: HBM) today released its first quarter 2025 financial results. All amounts are in U.S. dollars, unless otherwise noted. 'Our strong results in the first quarter reflect stable copper production and complementary gold production from our enhanced operating platform, which continued to deliver significant free cash flows and industry-leading margins,' said Peter Kukielski, President and Chief Executive Officer. 'We are well-positioned to deliver our full year 2025 consolidated production and cost guidance with the operations delivering in line copper production, better-than-expected gold production and effective cost control in the first quarter. We continue to benefit from steady mill throughput in Peru, higher grades and mill throughput in Manitoba and ongoing optimization efforts in British Columbia. This resulted in record adjusted EBITDA and record low cash cost performance in the quarter. We made significant progress in advancing our growth strategy as we consolidated ownership at Copper Mountain to increase our exposure to a high-quality asset in a tier-1 jurisdiction. We are also now fully permitted at Copper World to increase our long-term copper production by more than 50%. We will continue to reinvest in our attractive portfolio of high-return brownfield and greenfield growth opportunities to further enhance our copper and gold exposure and unlock significant value for all our stakeholders.' Achieved Record Adjusted EBITDA Driven by Strong Gold Production, Stable Copper Production and Industry-leading Margins; 2025 Production and Cost Guidance Reaffirmed Meaningful Gold Exposure and Steady Copper Performance Driving Continued Free Cash Flow Generation Reinvesting in High-return Growth Initiatives to Further Enhance Copper and Gold Exposure Summary of First Quarter Results Consolidated copper production of 30,958 tonnes in the first quarter of 2025 was in line with quarterly production cadence expectations, while consolidated gold production of 73,784 ounces was better than quarterly production cadence expectations. Consolidated copper and gold production was lower than the fourth quarter of 2024 due to lower planned grades in Peru as Hudbay is completing the final stripping phase in the high-grade Pampacancha pit, partially offset by higher gold production in Manitoba from better-than-expected gold grades. Consolidated silver production of 919,775 ounces and zinc production of 6,265 tonnes in the first quarter of 2025 were lower than the fourth quarter of 2024 primarily due to lower grades in Peru as the Company completed planned stripping activities. Cash generated from operating activities of $124.8 million decreased compared to the fourth quarter of 2024 as a result of higher cash taxes paid which are a function of higher profits in earlier quarters in Peru and Manitoba. Operating cash flow before change in non-cash working capital was $163.5 million during the first quarter of 2025, reflecting a decrease of $68 million compared to the fourth quarter of 2024. The decrease was primarily the result of lower gold and copper sales volumes in Peru as expected. First quarter adjusted EBITDAi was $287.2 million, a 12% increase compared to $257.3 million in the fourth quarter of 2024 as exposure to higher copper and gold prices in the quarter offset the lower sales volume. Net earnings attributable to owners in the first quarter of 2025 was $100.4 million, or $0.25 per share, compared to $21.2 million, or $0.05 per share, in the fourth quarter of 2024. The significant increase in earnings is the result of high gross margins from strong revenue growth on the back of higher realized copper and gold prices and strong unit cost control. In addition to higher mining and income tax expense experienced in the first quarter of 2025, the quarter was also impacted by various non-cash charges for revaluation loss of closed sites reclamation provisions, mark-to-market revaluation gain on various instruments, and foreign exchange gain, among other items. Adjusted net earnings attributable to ownersi and adjusted net earnings per share attributable to ownersi in the first quarter of 2025 were $93.8 million and $0.24 per share, respectively, after adjusting for various non-cash items on a pre-tax basis such as a non-cash loss of $12.8 million related to quarterly revaluation of Hudbay's closed site environmental reclamation provision, a $10.5 million variable consideration adjustment gain associated with the stream revenue and accretion, a $3.1 million mark-to-market revaluation gain on various instruments such as unrealized strategic copper hedges, investments and share-based compensation, a non-cash $3.1 million foreign exchange gain, and a $1.9 million gain related to flow-through share expenditures, among other items. This compares to adjusted net earnings attributable to ownersi and net earnings per share attributable to ownersi of $70.3 million and $0.18 per share in the fourth quarter of 2024. The sharp increase in adjusted net earnings attributable to ownersi and adjusted net earnings per share attributable to ownersi is for the same reasons discussed above for net earnings. In the first quarter of 2025, consolidated cash costi per pound of copper produced, net of by-product credits, achieved record low levels of $(0.45), compared to $0.45 in the fourth quarter of 2024. This improvement was a result of higher by-product credits and strong operating cost performance across all business units, partially offset by expected lower production levels in Peru during the quarter. Consolidated sustaining cash costi per pound of copper produced, net of by-product credits, was a record low at $0.72 in the first quarter of 2025, compared to $1.37 in the fourth quarter of 2024. The improvement was driven by the same factors impacting consolidated cash cost and slightly lower sustaining capital expenditures in the first quarter. Consolidated all-in sustaining cash costi per pound of copper produced, net of by-product credits, was $0.97 in the first quarter of 2025, lower than $1.53 in the fourth quarter of 2024 mainly due to the same reason outlined above. As at March 31, 2025, total liquidity was $1,008.5 million, including $562.6 million in cash and cash equivalents, $20.0 million in short-term investments as well as undrawn availability of $425.9 million under the Company's revolving credit facilities. Net debti at the end of the first quarter was $526.1 million and remained consistent with the fourth quarter of 2024. 1 Net debt and net debit to adjusted EBITDA are non-GAAP financial performance measures with no standardized definition under IFRS. For further information, please see the 'Non-GAAP Financial Performance Measures' section of this news release. 2 Working capital is determined as total current assets less total current liabilities as defined under IFRS and disclosed on the consolidated financial statements. 3 Net debt to adjusted EBITDA for the 12 month period. 1 Adjusted earnings per share - attributable to owners and adjusted EBITDA are non-GAAP financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see discussion under the 'Non-GAAP Financial Performance Measures' section of this news release. 1 Metal reported in concentrate is prior to deductions associated with smelter contract terms. 2 Includes total payable gold and silver in concentrate and in doré sold. 3 Cash cost, sustaining cash cost and all-in sustaining cash cost per pound of copper produced, net of by-product credits, are non-IFRS financial performance measures with no standardized definition under IFRS. For further information, please see the 'Non-IFRS Financial Performance Measures' section of this news release. Peru Operations Review 1 Reported tonnes and grade for ore mined are estimates based on mine plan assumptions and may not reconcile fully to ore milled. 2 Reflects combined mine, mill and general and administrative ('G&A') costs per tonne of ore milled. Reflects the deduction of expected capitalized stripping costs. 3 Combined unit costs, cash cost and sustaining cash cost per pound of copper produced, net of by-product credits, are non-IFRS financial performance measures with no standardized definition under IFRS. For further information, please see the 'Non-IFRS Financial Performance Measures' section of this news release. 4 Strip ratio is calculated as waste mined divided by ore mined. During the first quarter of 2025, the Peru operations produced 20,293 tonnes of copper, 7,869 ounces of gold, 554,692 ounces of silver and 397 tonnes of molybdenum, in line with mine plan quarterly cadence expectations. Production of copper, gold and silver in the first quarter of 2025 was lower than the fourth quarter of 2024 due to planned lower grades as a larger portion of lower grade Constancia ore was processed in the current quarter. Hudbay is on track to achieve its 2025 production guidance for all metals in Peru. Copper production was in line with mine plan expectations as the final phase of planned stripping at the Pampacancha deposit was underway during the first quarter of 2025. This resulted in planned lower head grades to the mill as Constancia ore represented a majority of the ore feed during the first quarter of 2025. Peru operations continued to benefit from strong and consistent mill throughput in 2025, averaging approximately 90,200 tonnes processed per day in the first quarter of 2025, partially offsetting the planned lower head grades. The operations continued to deliver strong cost control, resulting in lower combined unit cost compared to the fourth quarter of 2024. Total ore mined in the first quarter of 2025 increased by 10% compared to the fourth quarter of 2024. Ore mined from Pampacancha during the first quarter of 2025 decreased to 0.4 million tonnes, as Hudbay is performing the final stripping phase in the Pampacancha pit prior to depletion in late 2025. Ore mined from Constancia significantly increased during the first quarter of 2025 compared to recent quarters, in line with mine plan expectations. Milled copper and gold grades decreased by 38% and 75%, respectively, in the first quarter of 2025 compared to the fourth quarter of 2024, in line with the mine plan due to planned lower ore feed from Pampacancha. The Constancia mill achieved copper recoveries of 85% in the first quarter of 2025, lower than the fourth quarter of 2024 due to planned lower grades. Recoveries of gold and silver during the first quarter of 2025 were 57% and 66%, respectively, remaining in line with Hudbay's metallurgical models for the ore types that were being processed. Combined mine, mill and G&A unit operating costi in the first quarter of 2025 was $11.09 per tonne, 27% lower than the fourth quarter of 2024 due to a planned semi-annual mill maintenance shutdown in the fourth quarter and lower overall onsite costs. Cash costi per pound of copper produced, net of by-product credits, in the first quarter of 2025 was $1.11, outperforming quarterly cadence expectations as a result of strong operating cost performances and higher by-product prices. Cash costi per pound of copper produced, net of by-product credits was higher than the fourth quarter of 2024 due to planned lower copper production and gold by-product credits, partially offset by lower treatment, refining and freight charges. Cash costi for the quarter outperformed the low-end of the 2025 guidance range, and Hudbay is well positioned to achieve the full year 2025 cash cost guidance range in Peru. Sustaining cash costi per pound of copper produced, net of by-product credits, was $1.92 in the first quarter of 2025, an increase compared to the fourth quarter of 2024 primarily due to the same factors described above for the cash cost variance. The Company continues to evaluate opportunities to further increase mill throughput after the Peruvian Ministry of Energy and Mines approved a regulatory change in 2024 to allow mining companies in Peru to increase throughput by up to 10% above permitted levels. Hudbay is advancing engineering studies for the construction of a pebble crusher at Constancia commencing in late 2025, which is expected to further increase throughput levels starting in the second half of 2026. Manitoba Operations Review 1 Gold and silver recovery includes total recovery from concentrate and doré. 2 Metal reported in concentrate is prior to deductions associated with smelter terms. 3 Combined unit cost, cash cost, sustaining cash cost per pound of copper produced, net of by-product credits, gold cash cost and sustaining cash cost per ounce of gold produced, net of by-product credits, are non-GAAP financial performance measures with no standardized definition under IFRS. For further information, please see the 'Non-GAAP Financial Performance Measures' section of this news release. 4 Reflects combined mine, mill and G&A costs per tonne of ore milled. The Manitoba operations achieved impressive metal production and cost performance in the first quarter of 2025, significantly exceeding budgeted targets. The operations produced 60,354 ounces of gold, 3,469 tonnes of copper, 6,265 tonnes of zinc and 285,603 ounces of silver during the first quarter of 2025. Compared to the fourth quarter of 2024, production of gold meaningfully increased by 17% due to higher grades. Hudbay is on track to achieve its 2025 production guidance for all metals in Manitoba. The Lalor mine achieved strong production results in the first quarter, averaging 4,300 tonnes per day, demonstrating resilience despite one-off ore handling challenges in March. The mine maintained focus on ore quality, implementing stope modifications and improving mucking productivity rates. A significant focus is on capital development, aimed at securing high-grade copper-gold mineralization from Zone 27 and preparing for the next copper-gold mining front in Zone 17. The first quarter of 2025 saw significant improvements in ore quality, aligned with improvements in mining techniques, most notably in longhole muck fragmentation, and anticipated higher grade precious metal sequences. Total ore mined in Manitoba in the first quarter of 2025 was 6% lower than the fourth quarter of 2024 primarily due to temporary ore handling challenges at Lalor in March that were promptly resolved. Gold grades were better than expected, resulting in an 18% increase from the fourth quarter of 2024. Copper, zinc and silver grades were in line with mine plan expectations. The New Britannia mill continued its exceptional performance from recent quarters, achieving throughput of approximately 2,100 tonnes per day in the first quarter of 2025, slightly higher than the fourth quarter of 2024. New elongated cyclones were installed at New Britannia during the first quarter, mirroring successful upgrades at the Stall mill, and supporting Hudbay's strategy of low-capital projects to boost throughput and maintain gold recoveries. Gold recovery in the first quarter of 2025 was 90%, in line with the fourth quarter of 2024. At the Stall mill, a slight quarter-over-quarter reduction in throughput occurred as more ore was diverted to New Britannia in the first quarter. The Stall mill achieved gold recoveries of 70% in the first quarter of 2025, benefitting from recent recovery improvement programs continuing to be realized, with gold recoveries exceeding prior year figures. Efforts continue to optimize recovery, particularly by reducing grind size. The Manitoba operations continued to drive operating efficiencies, resulting in improved cost performance on both a unit operating basis and on a cash cost basis. Combined mine, mill and G&A unit operating costsi in the first quarter of 2025 were C$214 per tonne, representing an 8% decrease from the fourth quarter of 2024, primarily due to lower mine and mill costs. Cash costi per ounce of gold produced, net of by-product credits, in the first quarter of 2025 was $376, a significant 38% decrease compared to the fourth quarter of 2024 primarily due to higher gold production and lower mining and milling costs as a result of continued operating efficiencies and favorable exchange rates. With first quarter cash costs outperforming the low end of the cash cost guidance range, Hudbay is well positioned to achieve the 2025 cash cost guidance range in Manitoba. Sustaining cash costi per ounce of gold produced, net of by-product credits, in the first quarter of 2025 was $626, a 31% decrease compared to the fourth quarter of 2024, primarily due to the same factors affecting cash cost, partially offset by higher sustaining capital costs during the quarter. The exploration and haulage drifts at 1901 maintained solid development progress towards the deposit in the first quarter of 2025. A recent drill hole from the exploration drift intersected zinc-rich massive sulphides 20 metres earlier than anticipated, confirming planned first ore in the second quarter of 2025. The next two years will focus on exploration, definition drilling, orebody access, and establishing critical infrastructure for full production in 2027. British Columbia Operations Review 1 Copper Mountain mine results are stated at 100%. As at March 31, 2025, Hudbay owned 75% of the Copper Mountain mine. Subsequent to quarter end, Hudbay completed the acquisition of the remaining 25% interest, and as of the date of this news release, Hudbay owns 100% of the Copper Mountain mine. 2 Reported tonnes and grade for ore mined are estimates based on mine plan assumptions and may not reconcile fully to ore milled. 3 Strip ratio is calculated as waste mined divided by ore mined. 4 Reflects combined mine, mill and general and administrative ('G&A') costs per tonne of ore milled. Reflects the deduction of expected capitalized stripping costs. 5 Combined unit operating cost, cash cost and sustaining cash cost per pound of copper produced, net of by-product credits, are non-GAAP financial performance measures with no standardized definition under IFRS. For further information, please see the 'Non-GAAP Financial Performance Measures' section of this news release. Hudbay continues its focus on advancing optimization plans at the Copper Mountain mine, including opening up and optimizing the mine ore feed to the plant and implementing plant improvement initiatives that mirror Hudbay's successful processes at Constancia. These optimization initiatives have successfully increased the total tonnes moved and improved mill reliability. The British Columbia operations produced 7,196 tonnes of copper, 5,561 ounces of gold and 79,480 ounces of silver in the first quarter of 2025. Production of copper, gold and silver increased by 21%, 20% and 35%, respectively, compared to the fourth quarter of 2024, largely due to higher grades. Hudbay is on track to achieve its 2025 production guidance for all metals in British Columbia and continues to expect higher production in the second half of the year as the mill improvement projects take effect. Mining activities are focused on continuing to execute the three-year accelerated stripping program intended to bring higher grade ore into the mine plan. In January, Hudbay completed feasibility engineering to debottleneck and increase the nominal plant capacity to its permitted capacity of 50,000 tonnes per day earlier than contemplated in the most recent technical report. This is expected to be achieved through the conversion of the third ball mill to a second SAG mill, which remains on track for completion in the second half of 2025. Total ore mined at Copper Mountain in the first quarter of 2025 was 2.6 million tonnes, a 12% increase compared to the fourth quarter of 2024. Total material moved continued to ramp up in the quarter as a result of effective usage of the mining fleet to execute the accelerated stripping program to access higher head grades. The focus in the first quarter of 2025 was on mining efficiencies and operator recruitment to effectively utilize the available haul truck fleet. As a result, total material moved is expected to increase quarter-over-quarter in 2025 as per the mine plan. The mill processed 2.8 million tonnes of ore during the first quarter of 2025. Ore processed in the first quarter of 2025 was lower than the fourth quarter of 2024, limited by both planned and unplanned maintenance and elevated clay material last quarter which impacted the secondary crushing circuit. In the first quarter of 2025, a number of initiatives were advanced to address these issues and other identified constraints to improve throughput. Several mill initiatives have been implemented in 2025, including crushing circuit chute modifications, recovery improvements, reprogramming the mill expert system, installation of advanced semi-autogenous grinding control instrumentation, redesigned SAG liner package and updated operational procedures intended to remove magnetite from the pebble stream. Progressive improvements are expected to continue through 2025. Milled copper grades during the first quarter of 2025 were 27% higher than in the fourth quarter of 2024. The accelerated stripping efforts unlocked a higher-grade mining sequence during the first quarter of 2025, which reduced the amount of ore processed from stockpiles and resulted in higher grades this quarter compared to 2024. Copper recoveries of 78% in the quarter were 2% lower than the preceding quarter. Milled gold grades were higher in the first quarter of 2025 compared to the fourth quarter of 2024, resulting in higher gold recoveries of 63% in the first quarter of 2025. Combined mine, mill and G&A unit operating costsi in the first quarter of 2025 were C$25.98 per tonne milled, higher than the fourth quarter of 2024. The increase was due to higher mining and G&A costs and lower ore milled, partially offset by lower milling costs. Cash costi and sustaining cash costi per pound of copper produced, net of by-product credits, in the first quarter of 2025 were $2.44 and $4.24, respectively. Cash costs were 19% lower than the fourth quarter of 2024, largely due to higher by-product credits and the benefit from the continued focus on optimization efforts. With first quarter cash cost at the low-end of the 2025 guidance range, Hudbay is well positioned to achieve the full year 2025 cash cost guidance range in British Columbia. Sustaining cash costsi were 26% lower than in the fourth quarter of 2024 due to the same factors affecting cash costs as well as lower sustaining capital expenditures. Consolidated 100% Ownership in Copper Mountain On March 27, 2025, Hudbay announced an agreement with Mitsubishi Materials Corporation ('MMC') to acquire MMC's 25% minority interest in Copper Mountain for an upfront cash payment of $4.5 million and up to $39.75 million in deferred and contingent cash payments. The transaction closed on April 30, 2025 and Hudbay now holds a 100% interest in the Copper Mountain mine. In connection with the transaction, Hudbay is solely responsible to settle any of Copper Mountain's outstanding obligations, including an intercompany loan owing to Hudbay, of which 25% represents approximately $104 million. The transaction is highly accretive to Hudbay's net asset value per share and increases Hudbay's exposure to a long-life, high-quality copper asset in a tier-1 mining jurisdiction. The additional attributable production from the Copper Mountain mine reinforces Hudbay's position as the second largest copper producer in Canada and further strengthens its position as a North American copper champion. Hudbay has initiated a review of its Canadian corporate structure which is anticipated to generate tax synergies through the sharing of tax pools between its various Canadian entities. Continued Free Cash Flow Generation from Steady Operating Performance and Strong Copper and Gold Exposure Hudbay has delivered seven consecutive quarters of meaningful free cash flowvii generation as a result of brownfield investments, continuous operational improvement efforts and steady cost control across the business. Over the last twelve months, the Company has generated more than $350 million in free cash flowvii and $895.7 million in adjusted EBITDAi. While a majority of revenues continue to be derived from copper production, gold continues to represent more than 35% of total revenues. The unique copper and gold diversification is derived from copper and gold production in Peru, gold production from Manitoba and copper production contribution from British Columbia. The diversified and stable operating platform provides significant exposure to higher copper and gold prices. Using the mid-point of Hudbay's 2025 guidance ranges, a 10% increase in annual copper and gold prices would increase operating cash flow by $100 million and $56 million, respectively, as disclosed with Hudbay's 2025 guidance announcement in Februaryii. During the first quarter of 2025, the Company invested $25.5 million in growth capital expenditures relating to advancing high-return brownfield mill initiatives and greenfield copper projects to drive near-term and long-term production growth. Hudbay's balance sheet is well positioned to continue to advance its several growth initiatives. Net debti of $526.1 million in the first quarter of 2025 remained consistent with the fourth quarter of 2024 and reflects the deleveraging efforts completed in 2024. Hudbay's net debt to adjusted EBITDA ratioi was 0.6x in the first quarter of 2025, in line with the fourth quarter of 2024 and significantly improved from 1.3x in the first quarter of 2024 because of successful deleveraging efforts throughout 2024. Annual Reserve and Resource Update and Three-Year Production Guidance Hudbay provided its annual mineral reserve and resource update and issued new three-year production guidance on March 27, 2025. In Peru, current mineral reserve estimates total 517 million tonnes at 0.25% copper containing approximately 1.3 million tonnes of copper. In 2024, the Company increased mineral reserve estimates at Constancia to include the addition of a tenth mining phase in the Constancia pit after conducting positive geotechnical drilling and studies in 2023. This extended the expected mine life at Constancia by three years to 2041. Mining at the high-grade Pampacancha satellite pit commenced in 2021 and is expected to extend until early December 2025. The mine plan has smoothed Pampacancha production throughout 2025, resulting in total mill ore feed for 2025 from Pampacancha to be ~25%, lower than the typical one-third in prior years. Annual production at the Constancia operations is expected to average approximately 88,000iii tonnes of copper and 31,000iii ounces of gold over the next three years. This reflects steady copper production levels as higher mill throughput is expected to offset lower grades starting in 2026 after the depletion of Pampacancha in late 2025. In Snow Lake, the current mineral reserve estimates a total of approximately 16 million tonnes with approximately 1.7 million ounces in contained gold and an expected mine life to 2037. Snow Lake's life-of-mine production schedule has been optimized for higher mill throughput rates at New Britannia, maximizing gold production and cash flows. In 2024, record annual gold production of 214,225 ounces was achieved in Snow Lake through a combination of higher metallurgical recoveries at the New Britannia and Stall mills, despite processing lower gold grades year-over-year, and the strategic allocation of more gold ore feed to the New Britannia mill. Annual gold production from Snow Lake is expected to average more than 193,000iii ounces over the next three years. The impressive operating performance has resulted in 2025 gold production guidance being 8% higher than the previous 2025 guidance of 185,000iii ounces, and 2026 gold production guidance being 3% higher than the previous 2026 guidance of 185,000iii ounces. Similarly, the midpoint of the 2027 gold production guidance is 17% higher than the anticipated 2027 production in the most recent technical report. In British Columbia, current mineral reserve estimates at Copper Mountain total 346 million tonnes at 0.25% copper and 0.12 grams per tonne gold with approximately 850 thousand tonnes of contained copper and 1.3 million ounces of contained gold. The current mineral reserve estimates continue to support mine life until 2043, with significant upside potential for future resource conversion and mine life extension beyond 19 years through an additional 125 million tonnes of measured and indicated resources at 0.21% copper and 0.10 grams per tonne gold and 372 million tonnes of inferred resources at 0.25% copper and 0.13 grams per tonne gold, in each case, exclusive of mineral reserves. In 2025, the planned conversion of the third ball mill to a second SAG mill is anticipated to result in the ramp-up of mill throughput in the second half of the year. The mill throughput is anticipated to ramp up towards 50,000 tonnes per day in 2026. Annual production at the British Columbia operations is expected to average approximately 44,000iii tonnes of copper and 28,600iii ounces of gold over the next three years. Upon completion of Hudbay's optimization activities, 2027 copper production is expected to be 60,000iii tonnes, representing a 127% increase from 2024. 2027 expected copper production is also 20% higher than the production in the most recent technical report as a result of the deferral of higher grades from 2026 to 2027 in connection with the current accelerated stripping schedule. Consolidated copper production over the next three years is expected to average 144,000iii tonnes, representing an increase of 4% from 2024 levels. The increase is due to higher expected copper production in British Columbia as a result of mill throughput ramp-up throughout 2025 and 2026 and higher grades in 2027 from the accelerated stripping schedule, which more than offsets the depletion of the high-grade Pampacancha deposit in Peru at the end of 2025. Consolidated gold production over the next three years is expected to average 253,000iii ounces, reflecting higher-than-expected annual gold production levels in Manitoba, as compared to prior guidance, a result of continued strong operating performance in Snow Lake. 1 Metal reported in concentrate and doré is prior to smelting and refining losses or deductions associated with smelter terms. 2 Represents 100% of the production from the Copper Mountain mine. As at March 31, 2025, Hudbay owned 75% of the Copper Mountain mine. Subsequent to quarter end, Hudbay completed the acquisition of the remaining 25% interest, and as of the date of this news release, Hudbay owns 100% of the Copper Mountain mine. Advancing Copper World Towards a Sanction Decision Hudbay received the final major permit required for the development and operation of Copper World in January 2025, and the Company has since commenced a minority joint venture partner process. It is anticipated that any minority joint venture partner would participate in the funding of definitive feasibility study activities as well as the final project design and construction for Copper World. The Company has commenced work to support the definitive feasibility study and progress the project towards a potential sanction decision in 2026. Copper World is expected to produce 85,000 tonnes of copper per year over an initial 20-year mine life, and the project generates an after-tax net present value ('NPV') (8%) of $1.7 billion with an internal rate of return ('IRR') of 25.5% using a copper price of $4.25 per pound. Copper World is one of the highest-grade open pit copper projects in the Americasv with proven and probable mineral reserves of 385 million tonnes at 0.54% copper. There remains approximately 60% of the total copper contained in measured and indicated mineral resources (exclusive of mineral reserves), providing significant potential for future expansion and mine life extension. Once in production, Copper World is expected to be a meaningful copper producer in the U.S. domestic copper supply chain, which will help secure growing U.S. metal demand related to increased manufacturing capacity, infrastructure development, increased energy independence, domestic battery supply chain and strengthening the nation's security. Enhancing Stakeholder Relationships at Mason Hudbay's Mason project in Nevada is one of the largest undeveloped copper porphyry deposits in North America. Based on a preliminary economic assessment ('PEA') completed in 2021iv, Mason has the potential to be the third largest copper mine in the U.S. once in operation. The PEA contemplates a 27-year mine life with average annual copper production of approximately 140,000 tonnes over the first ten years of full production. Hudbay continues to advance local stakeholder engagement as well as additional metallurgical studies. While Mason is not as advanced as Copper World, Mason represents a long-term future development asset as part of Hudbay's pipeline of high-quality copper growth opportunities. Exploration Update LargeSnow Lake Exploration Program Continues to Execute Threefold Strategy Hudbay continues to execute the largest exploration program in Snow Lake in the Company's history through extensive geophysical surveying and multi-phased drilling campaigns as part of Hudbay's threefold exploration strategy: Signed Exploration Agreement with First Nations in Manitoba Hudbay is proud to have reached exploration agreements with two First Nations groups in Manitoba in 2025: Unlocking Value through Flin Flon Tailings Reprocessing Hudbay continues to advance studies to evaluate the opportunity to reprocess Flin Flon tailings where more than 100 million tonnes of tailings have been deposited for over 90 years from the mill and the zinc plant. The studies are evaluating the potential to use the existing Flin Flon concentrator, which is currently on care and maintenance after the closure of the 777 mine in 2022, with flow sheet modifications to reprocess tailings to recover critical minerals and precious metals in an environmentally-friendly manner. The more advanced opportunity relates to the zinc plant tailings where metallurgical test work continues following positive results from the initial confirmatory drill program completed in 2024. The results confirmed the grades of precious metals and critical minerals previously estimated from historical zinc plant records. An early economic study to evaluate the opportunity to reprocess the zinc plant tailings has confirmed the potential for a technically viable reprocessing alternative, and the Company is progressing with further engineering work. Maria Reyna and Caballito Drill Permits Proceeding Through the Regulatory Process Hudbay controls a large, contiguous block of mineral rights with the potential to host satellite mineral deposits in close proximity to the Constancia processing facility, including the past producing Caballito property and the highly prospective Maria Reyna property. The Company commenced the drill permitting process at Maria Reyna and Caballito after completing a surface rights exploration agreement with the community of Uchucarcco in August 2022. As part of the drill permitting process, environmental impact assessment (EIA) applications were approved by the government in June 2024 for Maria Reyna and September 2024 for Caballito. This represents one of several steps in the drill permitting process, and the government is targeting completion of the process in 2025. Normal Course Issuer Bid Hudbay's board of directors has approved, subject to the approval of the Toronto Stock Exchange (the 'TSX'), a normal course issuer bid ('NCIB') for up to 5% of the Company's issued and outstanding common shares ('Shares'). The NCIB will be conducted in accordance with the requirements of the TSX and applicable securities laws, with purchases to be made as appropriate opportunities arise from time to time. If the NCIB is approved by the TSX, Hudbay will be authorized to acquire up to a maximum of 5% of its issued and outstanding Shares, for cancellation over a period of 12 months. The actual number of Shares which may be purchased by Hudbay pursuant to the NCIB and the timing of such purchases will be determined by management of the Company and will be subject to a number of factors, including market conditions, share price, available cash resources and other opportunities to invest capital for growth. Purchases under the NCIB will be made through the facilities of the TSX, New York Stock Exchange, or through alternative Canadian trading systems and in accordance with applicable regulatory requirements at a price per Share equal to the market price at the time of acquisition. Any Shares purchased under the NCIB will be cancelled upon their purchase. Hudbay intends to fund the purchases from its cash flow from operations. Hudbay has elected to implement the NCIB because it believes that, from time to time, the market price of the Shares may not fully reflect the underlying value of Hudbay's business and future prospects. Hudbay believes that, at such times, the repurchase of the Shares for cancellation may constitute a desirable use of capital and would be in the best interests of shareholders. Website Links Hudbay: Management's Discussion and Analysis: Financial Statements: Conference Call and Webcast Qualified Person and NI 43-101 The technical and scientific information in this news release related to all of Hudbay's material mineral projects other than the Copper Mountain mine has been approved by Olivier Tavchandjian, P. Geo., Senior Vice President, Exploration and Technical Services. The technical and scientific information in this news release related to the Copper Mountain mine has been approved by Marc-Andre Brulotte, P. Geo., Director, Global Exploration and Resource Evaluation. Messrs. Tavchandjian and Brulotte are qualified persons pursuant to NI 43‑101. For a description of the key assumptions, parameters and methods used to estimate mineral reserves and resources at Hudbay's material mineral properties, as well as data verification procedures and a general discussion of the extent to which the estimates of scientific and technical information may be affected by any known environmental, permitting, legal title, taxation, sociopolitical, marketing or other relevant factors, please see the technical reports for the Company's material properties are available on SEDAR+ at and EDGAR at Cautionary Note Regarding Mason PEA Readers should be aware that the Mason PEA referred to in this news release is preliminary in nature, includes inferred resources that are considered too speculative to have the economic considerations applied to them that would enable them to be categorized as mineral reserves and there is no certainty the preliminary economic assessment will be realized. Non-GAAP Financial Performance Measures Adjusted net earnings (loss) attributable to owners, adjusted net earnings (loss) per share attributable to owners, adjusted EBITDA, net debt, cash cost, sustaining and all-in sustaining cash cost per pound of copper produced, cash cost and sustaining cash cost per ounce of gold produced, combined unit cost and ratios based on these measures are non-GAAP performance measures. These measures do not have a meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other issuers. These measures should not be considered in isolation or as a substitute for measures prepared in accordance with IFRS and are not necessarily indicative of operating profit or cash flow from operations as determined under IFRS. Other companies may calculate these measures differently. Management believes adjusted net earnings (loss) attributable to owners and adjusted net earnings (loss) per share attributable to owners provides an alternate measure of the Company's performance for the current period and gives insight into its expected performance in future periods. These measures are used internally by the Company to evaluate the performance of its underlying operations and to assist with its planning and forecasting of future operating results. As such, the Company believes these measures are useful to investors in assessing the Company's underlying performance. Hudbay provides adjusted EBITDA to help users analyze the Company's results and to provide additional information about its ongoing cash generating potential in order to assess its capacity to service and repay debt, carry out investments and cover working capital needs. Net debt is shown because it is a performance measure used by the Company to assess its financial position. Net debt to adjusted EBITDA is shown because it is a performance measure used by the Company to assess its financial leverage and debt capacity. Cash cost, sustaining and all-in sustaining cash cost per pound of copper produced are shown because the Company believes they help investors and management assess the performance of its operations, including the margin generated by the operations and the Company. Cash cost and sustaining cash cost per ounce of gold produced are shown because the Company believes they help investors and management assess the performance of its Manitoba operations. Combined unit cost is shown because Hudbay believes it helps investors and management assess the Company's cost structure and margins that are not impacted by variability in by-product commodity prices. The following tables provide detailed reconciliations to the most comparable IFRS measures. Adjusted Net Earnings (Loss) Reconciliation 1 Includes changes in fair value of the gold prepayment liability, Canadian junior mining investments, other financial assets and liabilities at fair value through net earnings and share-based compensation (recoveries) expenses. Also includes gains and losses on disposition of investments. Adjusted EBITDA Reconciliation 1 Share-based compensation expenses reflected in cost of sales and selling and administrative expenses. Net Debt Reconciliation 1 Share-based compensation expense reflected in cost of sales and administrative expenses. 2 LTM (last twelve months) as of March 31, 2025 and December 31, 2024. Annual consolidated results may not be calculated based on the amounts presented in this table due to rounding. Copper Cash Cost Reconciliation 1 Contained copper in concentrate. 1 Per pound of copper produced. 2 By-product credits are computed as revenue per consolidated financial statements, including amortization of deferred revenue and pricing and volume adjustments. 3 Gold and silver by-product credits do not include variable consideration adjustments with respect to stream arrangements. Variable consideration adjustments are cumulative adjustments to gold and silver stream deferred revenue primarily associated with the net change in mineral reserves and resources or amendments to the mine plan that would change the total expected deliverable ounces under the precious metal streaming arrangement. For the three months ended March 31, 2025 the variable consideration adjustments amounted to a gain of $9.9 million (three months ended March 31, 2024 and December 31, 2024 - loss of $3.8 million). 4 Depreciation is based on concentrate sold. 5 As per consolidated financial statements. 1 Contained copper in concentrate. 1 Per pound of copper produced. 2 By-product credits are computed as revenue per consolidated financial statements, including amortization of deferred revenue and pricing and volume adjustments. 3 Gold and silver by-product credits do not include variable consideration adjustments with respect to stream arrangements. 4 Depreciation is based on concentrate sold. 5 As per the consolidated financial statements. 1 Contained copper in concentrate. 1 Per pound of copper produced. 2 By-product credits are computed as revenue per consolidated financial statements, including amortization of deferred revenue and pricing and volume adjustments. 3 Depreciation is based on concentrate sold. 4 As per consolidated financial statements. Sustaining and All-in Sustaining Cash Cost Reconciliation 1 Includes accretion of decommissioning relating to non-productive sites, and accretion and amortization of community agreements capitalized to Other assets. 2 Other non-sustaining capital costs include Arizona capitalized costs, capitalized interest, capitalized exploration, right-of-use lease asset additions, equipment financing asset additions, growth capital expenditures and reclassification related to capital spares. 3 Amortization for community agreements relating to current operations. 4 Includes amortization of decommissioning and restoration PP&E assets and accretion of decommissioning and restoration liabilities related to producing sites. Gold Cash Cost and Sustaining Cash Cost Reconciliation 1 Contained gold in concentrate and doré. 1 Per ounce of gold produced. 2 By-product credits are computed as revenue per consolidated financial statements, amortization of deferred revenue, pricing and volume adjustments. 3 Depreciation is based on concentrate sold. 4 As per consolidated financial statements. Combined Unit Cost Reconciliation 1 G&A as per cash cost reconciliation above. 2 Other G&A primarily includes profit sharing costs. 3 As per consolidated financial statements. 1 G&A as per cash cost reconciliation above 2 As per consolidated interim financial statements. 1 G&A as per cash cost reconciliation above. 2 As per consolidated interim financial statements. Forward-Looking Information This news release contains forward-looking information within the meaning of applicable Canadian and United States securities legislation. All information contained in this news release, other than statements of current and historical fact, is forward-looking information. Often, but not always, forward-looking information can be identified by the use of words such as 'plans', 'expects', 'budget', 'guidance', 'scheduled', 'estimates', 'forecasts', 'strategy', 'target', 'intends', 'objective', 'goal', 'understands', 'anticipates' and 'believes' (and variations of these or similar words) and statements that certain actions, events or results 'may', 'could', 'would', 'should', 'might' 'occur' or 'be achieved' or 'will be taken' (and variations of these or similar expressions). All of the forward-looking information in this news release is qualified by this cautionary note. Forward-looking information includes, but is not limited to, statements with respect to Hudbay's production, cost and capital and exploration expenditure guidance, expectations regarding reductions in discretionary spending and capital expenditures, Hudbay's ability to advance and complete the optimization of the Copper Mountain mine operation, the implementation of stripping strategies and the expected benefits therefrom, the estimated timelines and pre-requisites for sanctioning the Copper World project and the pursuit of a potential minority joint venture partner, the possibility of and expectations regarding the results of any challenges to the permits for the Copper World project, the expected benefits of the sanctioning of Copper World project, the expected benefits of Manitoba growth initiatives, including the use of the exploration drift at the 1901 deposit, and the potential utilization of excess capacity at the Stall mill, the receipt of TSX approval of the NCIB, as well as any potential Share purchases under the NCIB, Hudbay's future deleveraging strategies and Hudbay's ability to deleverage and repay debt as needed, expectations regarding Hudbay's cash balance and liquidity, expectations regarding tax synergies, expectations regarding the ability to conduct exploration work and execute on exploration programs on its properties and to advance related drill plans, including the advancement of the exploration program at Maria Reyna and Caballito and the status of the related drill permit application process, expectations regarding the prospective nature of the Maria Reyna and Caballito properties, the ability to continue mining higher-grade ore in the Pampacancha pit and Hudbay's expectations resulting therefrom, expectations regarding Hudbay's ability to further reduce greenhouse gas emissions, Hudbay's evaluation and assessment of opportunities to reprocess tailings using various metallurgical technologies, the anticipated impact of brownfield and greenfield growth projects on Hudbay's performance, anticipated expansion opportunities and extension of mine life in Snow Lake and Hudbay's ability to find a new anchor deposit near Hudbay's Snow Lake operations, anticipated future drill programs and exploration activities and any results expected therefrom, anticipated mine plans, anticipated metals prices and the anticipated sensitivity of Hudbay's financial performance to metals prices, events that may affect Hudbay's operations and development projects, anticipated cash flows from operations and related liquidity requirements, the anticipated effect of external factors on revenue, such as commodity prices, estimation of mineral reserves and resources, mine life projections, reclamation costs, economic outlook, government regulation of mining operations, and business and acquisition strategies. Forward-looking information is not, and cannot be, a guarantee of future results or events. Forward-looking information is based on, among other things, opinions, assumptions, estimates and analyses that, while considered reasonable by Hudbay at the date the forward-looking information is provided, inherently are subject to significant risks, uncertainties, contingencies and other factors that may cause actual results and events to be materially different from those expressed or implied by the forward-looking information. The material factors or assumptions that Hudbay has identified and were applied in drawing conclusions or making forecasts or projections set out in the forward-looking information include, but are not limited to: The risks, uncertainties, contingencies and other factors that may cause actual results to differ materially from those expressed or implied by the forward-looking information may include, but are not limited to, risks related to the failure to effectively advance and complete the optimization of the Copper Mountain mine operations, political and social risks in the regions Hudbay operates, including the navigation of the complex political and social environment in Peru, risks generally associated with the mining industry and the current geopolitical environment, including future commodity prices, the potential implementation or expansion of tariffs, currency and interest rate fluctuations, energy and consumable prices, supply chain constraints and general cost escalation in the current inflationary environment, uncertainties related to the development and operation of Hudbay's projects, the risk of an indicator of impairment or impairment reversal relating to a material mineral property, risks related to the Copper World project, including in relation to project delivery and financing risks, risks related to the Lalor mine plan, including the ability to convert inferred mineral resource estimates to higher confidence categories, dependence on key personnel and employee and union relations, risks related to political or social instability, unrest or change, risks in respect of Indigenous and community relations, rights and title claims, operational risks and hazards, including the cost of maintaining and upgrading Hudbay's tailings management facilities and any unanticipated environmental, industrial and geological events and developments and the inability to insure against all risks, failure of plant, equipment, processes, transportation and other infrastructure to operate as anticipated, compliance with government and environmental regulations, including permitting requirements and anti-bribery legislation, depletion of Hudbay's reserves, volatile financial markets and interest rates that may affect Hudbay's ability to obtain additional financing on acceptable terms, the failure to obtain required approvals or clearances from government authorities on a timely basis, uncertainties related to the geology, continuity, grade and estimates of mineral reserves and resources, and the potential for variations in grade and recovery rates, uncertain costs of reclamation activities, Hudbay's ability to comply with Hudbay's pension and other post-retirement obligations, Hudbay's ability to abide by the covenants in Hudbay's debt instruments and other material contracts, tax refunds, hedging transactions, as well as the risks discussed under the heading 'Risk Factors' in Hudbay's most recent Annual Information Form which is available on the Company's SEDAR+ profile at and the Company's EDGAR profile at Should one or more risk, uncertainty, contingency or other factor materialize or should any factor or assumption prove incorrect, actual results could vary materially from those expressed or implied in the forward-looking information. Accordingly, you should not place undue reliance on forward-looking information. Hudbay does not assume any obligation to update or revise any forward-looking information after the date of this news release or to explain any material difference between subsequent actual events and any forward-looking information, except as required by applicable law. Note to United States Investors This news release has been prepared in accordance with the requirements of the securities laws in effect in Canada, which may differ materially from the requirements of United States securities laws applicable to U.S. issuers. About Hudbay Hudbay (TSX, NYSE: HBM) is a copper-focused critical minerals company with three long-life operations and a world-class pipeline of copper growth projects in tier-one mining jurisdictions of Canada, Peru and the United States. Hudbay's operating portfolio includes the Constancia mine in Cusco (Peru), the Snow Lake operations in Manitoba (Canada) and the Copper Mountain mine in British Columbia (Canada). Copper is the primary metal produced by the Company, which is complemented by meaningful gold production and by-product zinc, silver and molybdenum. Hudbay's growth pipeline includes the Copper World project in Arizona (United States), the Mason project in Nevada (United States), the Llaguen project in La Libertad (Peru) and several expansion and exploration opportunities near its existing operations. The value Hudbay creates and the impact it has is embodied in its purpose statement: 'We care about our people, our communities and our planet. Hudbay provides the metals the world needs. We work sustainably, transform lives and create better futures for communities.' Hudbay's mission is to create sustainable value and strong returns by leveraging its core strengths in community relations, focused exploration, mine development and efficient operations. For further information, please contact: Candace Brûlé Vice President, Investor Relations, Financial Analysis and External Communications (416) 814-4387 [email protected] ____________________ i Adjusted net earnings (loss) - attributable to owners and adjusted net earnings (loss) per share - attributable to owners, adjusted EBITDA, cash cost, sustaining cash cost, all-in sustaining cash cost per pound of copper produced, net of by-product credits, cash cost, sustaining cash cost per ounce of gold produced, net of by-product credits, combined unit cost, net debt and net debt to adjusted EBITDA ratio are non-GAAP financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the 'Non-GAAP Financial Performance Measures' section of this news release. ii Represents the increase in 2025 expected operating cash flow before change in non-cash working capital assuming a 10% change in a base of $4.10 per pound copper, $2,500 per ounce gold and 1.35 CAD/USD foreign exchange rate and the mid-point of annual guidance ranges. For more information, please refer to the Outlook section of the Management's Discussion and Analysis for the three and twelve months ended December 31, 2024. iii Calculated using the midpoint of the annual guidance range. iv Please refer to the additional disclosure regarding the Mason PEA in the Qualified Person and NI 43-101 section of this news release. v Sourced from S&P Global. vi For further information on the drill hole results, please refer to Hudbay's news release dated March 27, 2025. vii Free cash flow is calculated as operating cash flow before changes in non-cash working capital less sustaining capital expenditures, and cash payments from operating sites related to leases, equipment financing payments and community payments.
