TORONTO, July 31, 2025 (GLOBE NEWSWIRE) — Dundee Precious Metals Inc. (TSX: DPM) (“DPM” or the “Company”) announced its operating and financial results for the second quarter and first half ended June 30, 2025.
Highlights
(Unless otherwise stated, all monetary figures in this news release are expressed in U.S. dollars, and all operational and financial information contained in this news release is related to continuing operations.)
Record free cash flow generation: Generated $94.5 million of free cash flow1 and $99.5 million of cash provided from operating activities of continuing operations in the second quarter.Record adjusted net earnings per share: Reported second quarter adjusted net earnings1 of $87.6 million ($0.52 per share1) and net earnings from continuing operations of $82.4 million ($0.49 per share).Creating a premier mining business: Announced on June 13, 2025 that it had agreed with Adriatic Metals plc (“Adriatic”) to the terms pursuant to which it would acquire Adriatic and its high-quality Vareš silver-lead-zinc-gold operation for an implied equity value of approximately $1.3 billion2, forming a peer-leading growth profile.Advancing growth pipeline: Čoka Rakita feasibility study (“FS”) advancing well and on-track for completion at year-end 2025. Received the environmental licence for Loma Larga in June, a significant milestone for the project.Substantial liquidity for growth: Ended the quarter with a total of $796.6 million, consisting of $331.7 million in cash and cash equivalents and $464.9 million in restricted cash pursuant to the agreement to acquire Adriatic.Record capital returns: Returned $129.9 million, or 75% of free cash flow, to shareholders during the first half of 2025 through the repurchase of approximately 10 million shares and the quarterly dividend of $0.04 per share.On-track to meet 2025 guidance: With strong production of 61,212 ounces of gold and 6.4 million pounds of copper during the second quarter, and 111,075 ounces of gold and 12.3 million pounds of copper during the first half of 2025, DPM is well-positioned to meet its 2025 production guidance.Generating robust margins: Reported cost of sales per ounce of gold sold3 of $1,328 and an all-in sustaining cost per ounce of gold sold1,3 of $1,118 for the first half of the year, compared to an average realized gold price of $3,183 per ounce. DPM reconfirmed its 2025 guidance for all-in sustaining cost of $780 to $900 per ounce of gold sold, subject to dynamics such as the mark-to-market impact of DPM’s share price, as well as metal prices and foreign exchange movements relative to guidance assumptions. ____________________
1Free cash flow, adjusted net earnings, adjusted basic earnings per share and all-in sustaining cost per ounce of gold sold are non-GAAP financial measures or ratios. These measures have no standardized meanings under IFRS Accounting Standards (“IFRS”) and may not be comparable to similar measures presented by other companies. Refer to the “Non-GAAP Financial Measures” section commencing on page 13 of this news release for more information, including reconciliations to IFRS measures.2Based on the June 11, 2025 closing price of DPM shares of Cdn$20.33, and a GBP/CAD exchange rate of 1.85.3Cost of sales per ounce of gold sold represents total cost of sales for Chelopech and Ada Tepe, divided by total payable gold in concentrates sold, while all-in sustaining cost per ounce of gold sold includes treatment and freight charges, net of by-product credits, all of which are reflected in revenue. CEO Commentary
David Rae, President and Chief Executive Officer, made the following comments in relation to the second quarter results:
“We continue to consistently deliver robust free cash flow, generating a record $174 million year-to-date, further strengthening our financial capacity to fund growth. At the same time, our investors are benefiting from our low-cost, high-margin gold production as we continue to return capital to shareholders, demonstrated by the repurchase of a record 10 million shares during the first half of the year.
“We received the environmental licence for Loma Larga at the end of June, achieving a significant milestone for the project, which is an attractive future growth opportunity for DPM. We continue to advance permitting and the feasibility study for the Čoka Rakita project, which is on track for completion by year-end.
“The proposed acquisition of Adriatic is an excellent fit with our operating expertise and financial strength, and offers a clear and compelling value proposition for all of our shareholders. This is an exciting time for DPM and our shareholders, as we look to our future as a growing precious metals producer, offering a peer-leading development pipeline, a strong balance sheet and capital returns, all of which are underpinned by our exceptional operational track record.”
Use of non-GAAP Financial Measures
Certain financial measures referred to in this news release are not measures recognized under IFRS and are referred to as non-GAAP financial measures or ratios. These measures have no standardized meanings under IFRS and may not be comparable to similar measures presented by other companies. The definitions established and calculations performed by DPM are based on management’s reasonable judgment and are consistently applied. These measures are intended to provide additional information and should not be considered in isolation or as a substitute for measures prepared in accordance with IFRS. Non-GAAP financial measures and ratios, together with other financial measures calculated in accordance with IFRS, are considered to be important factors that assist investors in assessing the Company’s performance.
The Company uses the following non-GAAP financial measures and ratios in this news release:
mine cash costcash cost per tonne of ore processedmine cash cost of salescash cost per ounce of gold soldall-in sustaining costall-in sustaining cost per ounce of gold soldadjusted earnings (loss) before interest, taxes, depreciation and amortization (“adjusted EBITDA”)adjusted net earnings (loss)adjusted basic earnings (loss) per sharecash provided from operating activities, before changes in working capitalfree cash flowaverage realized metal prices For a detailed description of each of the non-GAAP financial measures and ratios used in this news release and a detailed reconciliation to the most directly comparable measure under IFRS, please refer to the “Non-GAAP Financial Measures” section commencing on page 13 of this news release.
Key Operating and Financial Highlights from Continuing Operations
$ millions, except where noted
Three Months Six Months 20252024Change 20252024ChangeOperating Highlights Ore Processedt730,980755,543(3%) 1,411,1221,456,741(3%)Metals contained in concentrates produced: Gold Chelopechoz47,03243,7348% 84,44581,2294%Ada Tepeoz14,18023,910(41%) 26,63049,142(46%)Total gold in concentrates producedoz61,21267,644(10%) 111,075130,371(15%)CopperKlbs6,4397,880(18%) 12,34414,572(15%)Payable metals in concentrates sold: Gold Chelopechoz38,33337,8491% 70,75567,4175%Ada Tepeoz14,54422,974(37%) 26,91148,618(45%)Total payable gold in concentrates soldoz52,87760,823(13%) 97,666116,035(16%)CopperKlbs5,2046,469(20%) 10,36711,926(13%)Cost of sales per ounce of gold sold(1): Chelopech$/oz1,0971,0039% 1,1031,0941%Ada Tepe$/oz1,9331,18863% 1,9201,10574%Consolidated$/oz1,3271,07324% 1,3281,09921%All-in sustaining cost per ounce of gold sold(2): Chelopech$/oz68253128% 6786701%Ada Tepe$/oz1,16669967% 1,24663895%Consolidated$/oz1,01171042% 1,11879341%Capital expenditures incurred(3): Sustaining(4) 5.97.9(24%) 13.513.60%Growth and other(5) 16.33.6343% 28.011.9134%Total capital expenditures 22.211.592% 41.525.563%Financial Highlights Average realized prices(2): Gold$/oz3,3342,36941% 3,1832,25441%Copper$/lb4.364.57(5%) 4.364.262%Revenue 186.5156.819% 330.6280.618%Cost of sales 70.265.28% 129.7127.52%Earnings before income taxes 92.080.215% 130.6126.53%Adjusted EBITDA(2) 114.193.123% 189.3147.628%Net earnings 82.470.916% 115.9110.35%Basic earnings per share$/sh0.490.3926% 0.680.6111%Adjusted net earnings(2) 87.670.924% 143.0103.438%Adjusted basic earnings per share(2)$/sh0.520.3933% 0.840.5747%Cash provided from operating activities(6) 99.5125.8(21%) 154.5161.6(4%)Free cash flow(2) 94.682.415% 173.7142.522%
(1)Cost of sales per ounce of gold sold represents total cost of sales for Chelopech and Ada Tepe, divided by total payable gold in concentrates sold.(2)All-in sustaining cost per ounce of gold sold, average realized metal prices, adjusted EBITDA, adjusted net earnings, adjusted basic earnings per share, and free cash flow are non-GAAP financial measures or ratios. Refer to the “Non-GAAP Financial Measures” section commencing on page 13 of this news release for more information, including reconciliations to IFRS measures.(3)Capital expenditures incurred are reported on an accrual basis and do not represent the cash outlays for capital expenditures.(4)Sustaining capital expenditures are generally defined as expenditures that support the ongoing operation of the asset or business without any associated increase in capacity, life of assets or future earnings. This measure is used by management and investors to assess the extent of non-discretionary capital spending being incurred by the Company each period.(5)Growth capital expenditures are generally defined as capital expenditures that expand existing capacity, increase life of assets and/or increase future earnings. This measure is used by management and investors to assess the extent of discretionary capital spending being undertaken by the Company each period.(6)Excludes cash used in operating activities of discontinued operations of $5.3 million (2024 – $9.1 million) and cash provided from operating activities of discontinued operations of $167.9 million (2024 – $8.5 million), respectively, during the second quarter and first half of 2025. Performance Highlights
A table comparing production, sales and cash cost measures by asset for the second quarter and first half ended June 30, 2025 against 2025 guidance is located on page 10 of this news release.
In the second quarter and first half of 2025, the Company’s operations delivered gold production in line with expectations. With higher grades at Chelopech and increased production from both mines planned for the second half of the year, DPM is on track to achieve its 2025 production guidance.
Highlights include the following:
Chelopech, Bulgaria: Gold contained in concentrates produced in the second quarter and first half of 2025 was higher than 2024 due primarily to higher gold grades, partially offset by lower volumes of ore processed and lower gold recoveries, in line with the mine plan. As per the mine plan, the Company continues to expect higher grades and increased production over the balance of the year.
Copper production in the second quarter and first half of 2025 was lower than 2024 due primarily to lower copper grades and recoveries, in line with the mine plan.
Payable gold in concentrates sold in the second quarter of 2025 was comparable to 2024 due primarily to higher gold production offset by timing of shipments. Payable gold in concentrates sold in the first half of 2025 was higher than 2024 due primarily to higher production and favourable payable gold terms, partially offset by timing of shipments.
Payable copper in concentrate sold in the second quarter and first half of 2025 was lower than 2024 due primarily to lower copper production.
All-in sustaining cost per ounce of gold sold in the second quarter and first half of 2025 was higher than 2024 due primarily to lower by-product credits reflecting lower volumes of copper sold, a stronger Euro relative to the U.S. dollar and higher labour costs including higher mark-to-market adjustments for share-based compensation as a result of DPM’s strong share price performance, partially offset by lower freight charges and lower cash outlays for sustaining capital expenditures for the year, as expected. All-in sustaining cost per ounce of gold sold in the second quarter of 2025 also benefited from lower treatment charges as a result of favourable market conditions.
Ada Tepe, Bulgaria: Gold contained in concentrate produced in the second quarter and first half of 2025 was lower than 2024 due primarily to mining in lower grade zones, as well as lower volumes of ore processed and lower gold recoveries, in line with the mine plan. As disclosed in February 2025, gold production at Ada Tepe is forecast to nearly double in the second half of 2025, relative to the first half, due to the cell sequencing of its integrated mine waste facility.
All-in sustaining cost per ounce of gold sold in the second quarter and first half of 2025 was higher than 2024 due primarily to lower volumes of gold sold, higher labour costs and a stronger Euro relative to the U.S. dollar, as well as higher cash outlays for sustaining capital expenditures, partially offset by lower royalties reflecting lower contained ounces mined.
Consolidated Operating Highlights
Production: Gold contained in concentrates produced in the second quarter and first half of 2025 was 10% and 15% lower than 2024, respectively, due primarily to lower gold grades at Ada Tepe, as well as lower volumes of ore processed and lower gold recoveries at both mines, partially offset by higher gold grades at Chelopech, in line with the mine plan for each operation.
Copper production in the second quarter and first half of 2025 was 18% and 15% lower than 2024, respectively, due primarily to lower copper grades and recoveries, in line with the mine plan.
Deliveries: Payable gold in concentrates sold in the second quarter and first half of 2025 was 13% and 16% lower than 2024, respectively, primarily reflecting lower gold production.
Payable copper in concentrate sold in the second quarter and first half of 2025 was 20% and 13% lower than 2024, respectively, due primarily to lower copper production.
Cost measures: Cost of sales in the second quarter and first half of 2025 was 8% and 2% higher than 2024, respectively, due primarily to higher labour costs and a stronger Euro relative to the U.S. dollar.
All-in sustaining cost per ounce of gold sold in the second quarter and first half of 2025 was 42% and 41% higher than 2024, respectively, due primarily to lower volumes of gold sold, higher mark-to-market adjustments to share-based compensation expenses reflecting DPM’s strong share price performance, lower by-product credits reflecting lower volumes of copper sold and a stronger Euro relative to the U.S. dollar, partially offset by lower freight charges. Mark-to-market adjustments to share-based compensation expenses resulted in an increase of $138 per ounce of gold sold in the first half of 2025 compared to an increase of $26 per ounce of gold sold in 2024.
Capital expenditures: Sustaining capital expenditures incurred in the second quarter of 2025 were 24% lower than 2024, due primarily to lower expenditures at Chelopech, as expected, partially offset by higher deferred stripping costs as a result of higher stripping ratios, in line with the mine plan at Ada Tepe. Sustaining capital expenditures incurred in the first half of 2025 were comparable to 2024.
Growth and other capital expenditures incurred in the second quarter and first half of 2025 were 343% and 134% higher than 2024, respectively, due primarily to costs related to the Čoka Rakita project being capitalized from 2025 as a result of the project’s advancement to the FS stage.
Consolidated Financial Highlights
The Company reported record financial results for the second quarter and first half of 2025, including record revenue, earnings and free cash flow. Financial results in the second quarter and first half of 2025 continued to reflect higher realized metal prices, partially offset by lower volumes of gold sold at Ada Tepe.
Revenue: Revenue in the second quarter and first half of 2025 was 19% and 18% higher than 2024, respectively, due primarily to higher realized metal prices, partially offset by lower volumes of gold sold at Ada Tepe.
Net earnings: Net earnings from continuing operations in the second quarter of 2025 was 16% higher than 2024 due primarily to higher revenue and lower evaluation expenses as a result of the capitalization of costs related to the Čoka Rakita project, partially offset by higher employee costs reflecting primarily higher mark-to-market adjustments to share-based compensation expenses and Adriatic acquisition related costs of $5.1 million. Net earnings from continuing operations in the first half of 2025 was 5% higher than 2024, due primarily to the same factors affecting the quarter, partially offset by the 2025 Bulgarian levy of $24.4 million.
Adjusted net earnings: Adjusted net earnings from continuing operations in the second quarter and first half of 2025 was 24% and 38% higher than 2024, respectively, due primarily to the same factors affecting net earnings from continuing operations, with the exception of adjusting items primarily related to the 2025 Bulgarian levy and Adriatic acquisition related costs, as well as a net termination fee received from Osino Resources Corp. (“Osino”) in 2024.
Cash provided from operating activities of continuing operations in the second quarter and first half of 2025 was 21% and 4% lower than 2024, respectively, due primarily to the timing of deliveries and subsequent receipt of cash, the timing of payments to suppliers and the first payment of the 2025 Bulgarian levy, partially offset by higher earnings generated in the periods.
Free cash flow: Free cash flow from continuing operations in the second quarter and first half of 2025 was 15% and 22% higher than 2024, respectively, due primarily to higher adjusted net earnings generated in the periods, partially offset by the first payment of the 2025 Bulgarian levy. Free cash flow is calculated before changes in working capital.
Proposed Acquisition of Adriatic
On June 13, 2025, the Company announced that it had agreed with Adriatic to the terms of a recommended acquisition of the entire issued, and to be issued, ordinary share capital of Adriatic (the “Transaction”) for an implied equity value of approximately $1.3 billion. Upon completion of the Transaction, DPM will acquire 100% of the Vareš operation in Bosnia and Herzegovina, a producing silver-lead-zinc-gold underground mine.
Under the terms of the Transaction, shareholders of Adriatic (“Adriatic Shareholders”) will be entitled to receive 0.1590 of a common share of DPM (each whole share, a “DPM Share”) and 93 pence in cash for each ordinary share of Adriatic (each, an “Adriatic Share”). The implied value for each Adriatic Share is £2.68 (and CHESS Depository Interests of Adriatic at AUD$5.56), based on the closing price of Cdn$20.33 per DPM Share and a GBP/CAD exchange rate of 1.85 on June 11, 2025. Immediately following completion of the Transaction, it is expected that current shareholders of DPM (the “DPM Shareholders”) will own approximately 75%, and former Adriatic Shareholders will own approximately 25%, of DPM’s issued share capital.
The Transaction will be subject to certain closing conditions, including, among other things: (i) approval of the Transaction by Adriatic Shareholders; (ii) court approval; (iii) the issuance of the DPM Shares to be issued in the Transaction being approved by DPM Shareholders; (iv) receipt of the approval for listing of such DPM common shares by the TSX; (v) receipt by DPM of an unconditional approval of the Transaction by the Bosnian Competition Council in accordance with the Bosnian Competition Act; and (vi) the Transaction becoming effective no later than December 31, 2025. The TSX has conditionally approved the listing of the DPM Shares to be issued under the Transaction, subject to DPM satisfying the customary listing conditions of the TSX and filing (or causing to be filed) certain documents in connection with the closing of the Transaction.
Balance Sheet Strength and Financial Flexibility
The Company continues to maintain a strong financial position, with a growing cash position, no debt and an undrawn $150 million revolving credit facility.
Cash and cash equivalents decreased by $303.1 million to $331.7 million in the first half of 2025, due primarily to the restricted cash set aside pursuant to the agreement to acquire Adriatic, payments for shares repurchased under the Normal Course Issuer Bid (“NCIB”), cash outlays for capital expenditures and dividends paid, partially offset by earnings generated in the period and cash interest received, as well as a net cash inflow of $167.9 million under a DPM tolling agreement related to the disposition of the Tsumeb smelter in 2024.
Return of Capital to Shareholders
In line with its disciplined capital allocation framework, DPM continues to return excess capital to shareholders, which currently includes a sustainable quarterly dividend and periodic share repurchases under the NCIB.
During the first half of 2025, the Company returned a total of $129.9 million to shareholders through the repurchase of approximately 10.0 million shares, for a total cash payment of $116.1 million, and $13.8 million of dividends paid.
On July 31, 2025, the Company declared a dividend of $0.04 per common share payable on October 15, 2025 to shareholders of record on September 30, 2025.
Development Projects Update
Čoka Rakita, Serbia
The Company continues to advance the Čoka Rakita project, targeting first concentrate production in 2028. The FS is advancing as planned and is expected to be completed by year-end 2025. Most of the surface and underground geotechnical and hydrogeological drilling is now complete. Advancing the design to the basic engineering level, the project execution readiness, and commencing operational readiness activities are all proceeding as planned.
Permitting activities have continued to advance, with a detailed permitting timeline focused on supporting commencement of construction in mid-2026.
Work continues on various baseline studies required for the Environmental and Social Impact Assessment. DPM continues to focus on completing all preparatory work for the Special Purpose Spatial Plan, pending a decision by the Serbian government to initiate the process, and is proactively engaging with relevant stakeholders to mitigate the risk of administrative delays.
The Company has planned to spend $40 million to $45 million of growth capital expenditures for the Čoka Rakita project in 2025, with $19.0 million incurred in the first half of the year.
Loma Larga, Ecuador
During the second quarter, the environmental licence for the Loma Larga project was issued by the Ministry of Environment, Water and Ecological Transition, which represents a significant milestone for the project and is the result of a rigorous process by the government to ensure high Ecuadorian standards are applied in the development of mining projects. DPM’s commitment to these standards is consistent with the Company’s proven development practices and adoption of international standards and best practices which meet or exceed national standards. Following the environmental licence issuance, negotiations for the exploitation agreement are in progress.
The approval