Alamos Gold, Inc. Q1 FY2026 earnings call

• Production Overview: First quarter production was 124,000 ounces, in line with guidance. Island Gold District had strong performance offsetting lower production at Young-Davidson. Second quarter production expected to increase ~20%, and full-year production on track to meet guidance.
• Costs: First quarter all-in sustaining costs were $1,862 per ounce, expected to decrease ~5% in second quarter and more significantly in second half due to increased low-cost production from Island Gold. Monitoring inflationary pressures on cost structure and expecting productivity improvements to drive costs lower.
• Financials: Record quarterly revenues of $597 million from selling 122,000 ounces of gold at average realized price of $4,829 per ounce. Operating cash flow before changes in non-cash working capital increased to a record $338 million. Strong free cash flow of $102 million generated in first quarter.
• Exploration and Expansion: Successful 2025 exploration program led to 32% increase in year-end mineral reserves to 16 million ounces, including near doubling of reserves at Island Gold District. Island Gold District expansion study released, outlining large, long-life, low-cost operation. Phase III+ shaft expansion and Magino mill expansion well underway with key milestones approaching.

Island Gold District

• Production: First quarter production was 61,200 ounces, with underground mining rates averaging a record over 1,400 tonnes per day, and milling rates improving. Second quarter production expected to increase by ~20%, and further growth in second half of the year. All-in sustaining costs expected to decrease in second half due to increased low-cost production from the district.
• Revenue contribution: Not explicitly stated as a percentage but is a key segment contributing to overall performance.

Young-Davidson

• Production: First quarter produced 30,000 ounces, lower than planned due to lower mining and milling rates. Expected to see improvement in second quarter with higher mining and milling rates and grades returning to guidance.
• Revenue contribution: Not explicitly stated as a percentage but is a segment.

Mulatos District

• Production: First quarter produced 32,700 ounces, including nearly 27,000 ounces from Yaqui Grande. Costs at low end of annual guidance in first quarter, expected to increase later in the year as grade stocks decrease.
• Revenue contribution: Not explicitly stated as a percentage but is a segment

• First quarter all-in sustaining costs were $1,862 per ounce and expected to decrease ~5% in second quarter, with more significant improvement in second half.
• Second quarter production expected to increase by approximately 20% due to ramp-up of underground mining rates at Island Gold and improvements at Young-Davidson.
• Full-year production on track to meet guidance with Island Gold District expected to drive further production growth in second half of the year.
• Expect annual production to continue increasing to 1 million ounces by 2030 with further cost decreases, internally funded by ongoing free cash flow and strong balance sheet with $1.2 billion in available liquidity

• Inflationary Pressures: Monitoring impact of ongoing inflationary pressures across cost structure including higher labor, contractor, diesel, and electricity costs. Need to manage cost pressures with productivity improvements.
• Project Execution Risks: Potential risks associated with Phase III+ shaft expansion, Magino mill expansion, and other growth projects such as delays in construction, procurement issues, or scope changes that could impact timelines and costs

Q: Hi, John and Alamos team. Just a couple of questions from me. My first question is on Island Gold. Really great to see mining rates averaging 1,400 tonnes per day, and those are expected to grow over the next couple of quarters. In regards to the area where you had the seismic issue, how much more work is required to completely rehabilitate that area, and do you need this area to achieve the 2,000 tonnes per day that you are targeting by the end of the year?

A: Ovais, it is Luc here. With regards to the Island Gold mining front where we had to reestablish the escapeway, we completed that at the beginning of the year. The escapeway has been reestablished, which allows us to continue mining in that area. As far as the overall ramp-up for 2026 and what we are expecting, there is not a lot of production actually coming out of that area. We will see some production starting in the second half of the year, and we are continuing with some minor rehabilitation in this area since we completed the escapeway, which allows us to continue activities in that region. It is not critical to the overall ramp-up for 2026 and as we move forward.

Q: Hi, thanks for taking my question. There was a comment in the press release talking about managing cost pressures with productivity improvements. Can you talk about what specific productivity improvements there are across the portfolio?

A: Yes, Fahad, it is Greg here. That is referencing what we have already identified as part of our plan in 2026 and even moving into 2027. The critical thing is ramping up our mining rates at Island Gold from 1,400 tonnes per day, which we achieved in Q1, up to 2,000 tonnes per day by the end of the year. As we increase our production from the underground at Island, that is critical for us because it is our lowest-cost structure across our portfolio. The other piece would be ramping up the Magino mill from 7,500 tonnes per day in Q1 to closer to 10,000 tonnes through at least the second half of the year. That is going to bring down our cost structure in the second half of the year. The last would be the mining rates at Young-Davidson getting back up to 8,000 tonnes per day. All of those items are going to manage those cost pressures in 2026. Then as we move into 2027, moving from ramp mining to skipping up the shaft at Island will have a significant impact on our cost structure moving forward. The last is hooking up grid power at the Magino mill, and that is something we plan to have in place by early 2027 as well. All of those go a long way to managing any inflationary pressures that we are seeing.

Q: Thanks very much. My question is firstly on Young-Davidson and within the context of the strong recovery that we are going to see through 2026. There is some discussion around stope overbreak leading to a review of the blasting design. Is this something new that we are dealing with? Was this identified as a risk when we encountered some of the headwinds in the back half of 2025? Is the blasting review part of where we are having these stope overbreak issues, or is this part of a broader all-stope-encompassing plan?

A: Hi, it is Luc here. Drilling and blasting review is always an ongoing process with regards to the closeout and reconciliation of each of our stopes. This is nothing new. We continue to review that on an ongoing basis. Historically, the performance has been good at Young-Davidson. We have been mining there now for the better part of 13 years. Actual results from a grade perspective usually reconcile quite well to the model, and we have a good history of that. In this specific quarter, we did have a couple of stopes that underperformed from a dilution aspect, where we typically model around 10% to 12% dilution and we had higher dilution on a couple of stopes that we mined in the quarter. The process of closing out the reconciliation is also looking at the drilling and blasting design and seeing if there are some improvements based on that reconciliation—any modifications we may need to make. It could be specific to certain regions, maybe some structures within those regions that are adding to the dilution, and we may need to change our drill and blasting pattern as a result. We take all that into consideration and do a full analysis, and part of it is certainly the drill-and-blast design as well.

Q: Thanks, Operator, and good morning, John and team. Great to see the growth trajectory affirmed. First question, going back to the discussion on diesel. We see that costs are expected to decrease by 5% in Q2. Does this assume that diesel prices remain flat?

A: Correct. It is based on the spot prices that were in place at March 31, so the higher rates that we are seeing now are what we assumed when we talked about that 5% reduction in cost.

Q: Hi, good morning. Thanks, Operator, and thanks Alamos team for taking our questions. Just on the Phase III+ expansion, it is good to see the shaft sink complete and essentially 100% of the growth capital spent or committed, with commissioning expected early next year. What are the remaining critical path items? Is it the paste plant that is currently on track for completion in Q2? What are the next key milestones that we should watch to keep this on track for early 2027?

A: Things are tracking well with regards to the Phase III+ expansion. The two critical items right now: first, we have completed all of the rock work in the shaft, and now we are furnishing the shaft—putting all of the structural steel in the shaft and separating the compartments for skipping, personnel travel, and services. That will occur over the rest of this year, with a timeline to be completed early in the first quarter of 2027. The second component is ore and waste handling infrastructure required to feed the shaft. We are well advanced there as well. We are doing rock work for one of the large bins for the underground loading pocket and will be establishing our grizzly station as well as the loading pocket at 1,350 meters. That work is also expected to be completed in early 2027 in the first quarter. By mid-Q1 we should have the ore and waste handling components commissioned as well as the shaft commissioned to start utilizing it for ore and waste movement and personnel movement.

Q: Hi, good morning. Thanks for taking my questions. My first question is on capital allocation. We saw strong free cash flow generation in the first quarter, but there were no share buybacks. Given free cash flow is expected to improve throughout the remainder of the year, how should we think about the potential for getting more active in buybacks?

A: We have always taken a very opportunistic approach to share buybacks. We had a focus in the first quarter on increasing the dividend and we spent $45 million buying back part of the legacy Argonaut hedges. But given the opportunity we see now with our shares underperforming in the market, a good guess would be that we are being opportunistic on that front. We expect to be more active with the share buyback in Q2 and for the remainder of the year.

Q: Maybe one on Magino. You expect meaningful cost savings from connecting the Magino mill to grid power. Can you quantify the dollar-per-ounce impact when it is fully online?

A: It is about $5 per tonne