Coeur Mining, Inc. Q2 FY2026 earnings call

Financial Strength and Capital Allocation

• Ending cash exceeded $1 billion for the first time in company history, and the balance sheet is now a significant source of strength expected to grow further
• The company resumed active share repurchases under the expanded $750 million buyback program in the second half of Q2, and paid its first dividend in 30 years
• As of June 30, the company had completed $110 million in share buybacks, paid the inaugural dividend, and eliminated $39 million in higher-cost capital lease debt
• Capital allocation prioritizes organic growth and exploration investment, followed by opportunistic share repurchases and continued capital return to shareholders

Operational Milestones

• Post-acquisition integration of the Canadian assets (New Afton and Rainy River) is advancing according to schedule
• CORE was added to the S&P 400 Mid-Cap Index on June 8, 2026, highlighting the quality of its North American-only diversified precious metals platform
• Rochester achieved record quarterly crushing volumes and completed Phase 2A leach pad expansion, positioning it for a strong second half production uplift
• At New Afton, the team is prioritizing balanced, disciplined cave propagation to protect long-term mine productivity, with gradual ramp-up of throughput to avoid compromising long-term performance
• At Rainy River, open pit Phase 5 pre-stripping is ahead of schedule, and corrective actions to address underground contractor bottlenecks have already delivered material production rate improvements
• Brownfield exploration at Mexican operations continues to deliver successful resource expansion, creating multi-stage growth opportunities at Palmarejo outside the existing Franco-Nevada stream area

Strategic Priorities

• Focus on delivering sharp increases in production and free cash flow in the second half of 2026 to deliver record full-year 2026 results, positioning the firm for another record year in 2027
• Continue high-return brownfield exploration to expand existing resources and extend mine lives
• Advance studies on high-potential growth projects including New Afton's K-Zone and the Silvertip project

CORE is a North America-only precious metals producer with seven operating assets. In Q2 2026, the consolidated firm achieved record revenue of $1.1 billion, record EBITDA of $478 million (including a $141 million non-cash fair value uplift for Rainy River short-term stockpiles), and record free cash flow of $388 million, a 45% increase quarter-over-quarter. Ending cash balance was $1.1 billion, double the year-end 2025 level, with total liquidity exceeding $2 billion. The newly acquired Canadian assets (New Afton and Rainy River) contributed 45% of total quarterly free cash flow (~$175 million) while in ramp-up mode:

• Rochester (Nevada): Achieved a new quarterly record of 6.8 million metric tons crushed, a 15% increase quarter-over-quarter, with 97% of material running through all three crushing stages. Phase 2A of the leach pad expansion was completed, with over 4 million tonnes of ore placed on the pad through July.
• Wharf: Returned to full normal operations in May after recovering from the November 2025 crusher fire incident, exceeding operational expectations and completing all repairs ahead of schedule.
• New Afton (Canada): Averaged 12,000 tonnes of mining per day in Q2, with rates increasing to 14,000 tonnes per day by the end of July, as the team prioritizes disciplined cave draw management for long-term productivity after April 2026 completion of the sea zone development.
• Rainy River (Canada): Generated Q2 free cash flow of $123 million, the highest in the mine's history, driven by solid open pit Phase 4 production. Open pit waste stripping for Phase 5 remained ahead of schedule, but underground production averaged only 2,300 tonnes per day due to short-term contractor execution challenges, increasing to ~3,300 tonnes per day in July after corrective actions.
• Palmarejo and Las Chispas (Mexico): Brownfield exploration continues to deliver successful results, with new resource growth at Palmarejo's eastern extensions and Las Chispas gap zone targets; Las Chispas maintained steady, consistent Q2 throughput with healthy stockpile inventory for production balancing.

• Overall 2026 full-year guidance is updated to reflect slower-than-originally-planned ramp-ups at New Afton and Rainy River, with the company still expecting record full-year 2026 results based on the revised plan
• 2026 expected EBITDA is ~$2.3 billion and expected full-year free cash flow is ~$1.5 billion, based on assumed pricing of $4,000 per ounce gold, $60 per ounce silver, and $6 per pound copper
• At New Afton, the target 16,000 tonnes per day throughput is now expected to be achieved in early Q4 2026, three months later than the original end-Q2 2026 target, to support healthy long-term cave growth
• At Rainy River, the target 5,000 tonnes per day underground production rate is now expected by year-end 2026, one quarter later than the original Q3 2026 target, with a gradual linear ramp-up from July's ~3,300 tonnes per day
• 2026 CapEx guidance was updated to add $70 million in total: $45 million to reclassify Phase 5 stripping costs (previously operating, now capitalized), $25 million for underground infrastructure/development corrections at Rainy River, and $15 million for the Silvertip 2026 pre-feasibility study
• Adjusted CAS guidance increased for both New Afton and Rainy River due to lower expected 2026 production, though total operating costs at New Afton remain unchanged; Rainy River is expected to see a 10% (~$30 million) increase in 2026 total operating costs to address underground bottlenecks
• Cash tax guidance was lowered due to lower assumed metals prices and lower Canadian tax obligations; amortization guidance was also reduced following completion of purchase price allocation for the acquired Canadian assets
• The non-cash fair value uplift for acquired Rainy River stockpiles will be fully recognized by the end of Q3 2026, with the remaining $38 million impact hitting Q3 results, after which the accounting impact will be complete

• Lower than planned grades at Kensington, Rochester, and Palmarejo in Q2 2026, though management expects these grades to rebound in the second half of 2026
• At New Afton, unbalanced cave growth could compromise long-term mine productivity if draw rates are accelerated too quickly, requiring a slower ramp-up than originally planned
• At Rainy River, underground contractor execution gaps created bottlenecks that required additional capital and operating expenditures, though management expects quick payback on these investments
• Cost inflation, particularly for diesel, is impacting operating costs
• Non-cash fair value accounting for acquired stockpiles creates volatility in reported EBITDA, CAS, and net income through Q3 2026, though this has no impact on cash flow
• Exploration and project development carry inherent uncertainty around resource expansion and project economics, with results of ongoing work not yet finalized

Q: What drove the downward revision to New Afton's 2026 guidance, and was the change driven by ramp-up timing or lower-than-expected grades?/ A: The original plan targeted 16,000 tonnes per day by the end of Q2, but that target is now pushed to early Q4, roughly three months later. The revision is primarily driven by the need to maintain balanced cave propagation for long-term mine health: management is drawing more from lower-grade western and northern portions of the cave to encourage even growth, delaying access to the higher-grade eastern zone. There is only a minor grade impact from this intentional draw management. The slower ramp is limited to 2026, with no expected long-term impact on total reserve recovery to date.

Q: What were the underlying causes of Rainy River's slower underground ramp-up, when will the full target rate be achieved, and when will the non-cash stockpile accounting impact end?/ A: Short-term tactical gaps in equipment, personnel, and infrastructure created bottlenecks as throughput began to climb, which management identified and addressed quickly after taking ownership of the asset. Underground production increased 40% to 3,300 tonnes per day in July, with a linear ramp to the 5,000 tonne per day target now expected by year-end 2026, one quarter later than originally planned. The full non-cash fair value uplift will be completely recognized by the end of Q3 2026, with only the remaining $38 million impact left to flow through Q3 results, after which the accounting noise will end.

Q: With a high and growing cash balance, what is the cadence for the $750 million share buyback program, and what are the priority growth areas for future capital spending in 2027 and beyond?/ A: The buyback program is structured to allow opportunistic purchases: management will accelerate repurchases when the share price appears undervalued, with no forced timeline to spend the full $750 million by a set date. Priorities for future growth capital include continued brownfield exploration at existing assets, advancing studies for New Afton's K-Zone expansion, progressing the Silvertip pre-feasibility study (expected to complete in early 2027), evaluating longer-term expansion at East Rochester, and assessing potential mine life extensions at Rainy River.

Q: What are the near, medium, and long-term exploration and production goals for Palmarejo outside the Franco-Nevada stream area?/ A: Near-term focus is on the Independencia Sur extension, which lies outside the Franco-Nevada stream area. Management aims to bring this area into production over the next 2-3 years to increase the share of gold production sold at full market price (currently ~50% of production is subject to the Franco-Nevada stream). Medium-term focus is on the Guazaparas area further east, with longer-term potential for either hauling ore to the existing Palmarejo mill or developing a standalone operation, contingent on continued resource growth. Additional exploration potential exists between these two areas, creating a multi-stage growth pipeline for the asset.