Financial Data and Key Metrics Changes - The company reported adjusted EBITDA of $82.7 million and adjusted net income attributable to owners of the company of $48.1 million, or $0.46 per share [15] - Liquidity position remains solid at $113 million, including $68.3 million in cash and cash equivalents [15] - Net debt to EBITDA ratio improved from 2.4 times to 2.1 times due to stronger EBITDA and debt repayments [15][16] Business Line Data and Key Metrics Changes - Significant quarter-on-quarter increases in production from both Carriba and Javancina, with Carriba seeing a 25% increase in copper production compared to Q1 [9][10] - At Carriba, unplanned infrastructure downtime was reduced by 50%, and mobile equipment fleet availability improved by over 10% [10] - Javancina experienced a 17% increase in gold production compared to Q1, with expectations for further improvements in the second half of the year [12] Market Data and Key Metrics Changes - The company expects to achieve copper production trending towards the low end of guidance due to ongoing operational improvements and favorable market conditions [11] - The foreign exchange hedge program had a total notional position of $240 million, with a modest realized gain of $200,000 during the quarter [16] Company Strategy and Development Direction - The company is focused on operational excellence, with a back-to-basics approach and significant changes in strategy and technology [7][8] - The strategy includes improving existing operations, achieving commercial production at Tucumar, and advancing long-term growth initiatives at Furnas [13] - The company aims to initiate returns to shareholders as part of its long-term strategy [18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the second half of the year, expecting improved performance and production consistency [9][10] - The foundational work completed in the first half is anticipated to set the company up for continued momentum and growth [9] - Management acknowledged challenges in the first half but emphasized the importance of addressing bottlenecks and achieving operational consistency [22][38] Other Important Information - The company completed its Phase one drill program at Furnas and is on track to complete the Phase two drill program by year-end [13] - The shaft sinking project at Pilar is progressing well, with expectations for operational readiness in 2027 [40] Q&A Session Summary Question: Update on Tucumar's production capacity - Management confirmed that Tucumar achieved production levels at or slightly below design capacity and emphasized the need for consistent performance moving forward [21][24] Question: Cash costs at Carriba - Management indicated that while cash costs are expected to be in the lower half of the guidance range, there may be upward pressure due to lower grades in the second half [27][29] Question: Grades at Javancina - Initial mechanized mining has resulted in less dilution than manual mining, with grades expected to align with overall expectations for the year [30][31] Question: Remaining bottlenecks at Tucumar - Management clarified that the focus is now on preventative maintenance to ensure consistent operational performance, having addressed earlier bottlenecks [38] Question: Contribution from the sorghum pit at Carriba - Management noted that operational excellence initiatives have contributed to outperformance, with Serbeam expected to be a significant contributor in the second half [46][47] Question: Timeline for shareholder returns - Management indicated that the priority is to continue deleveraging the balance sheet before considering cash returns to shareholders [80]

Financial Data and Key Metrics Changes - The company reported adjusted EBITDA of $82.7 million and adjusted net income attributable to owners of the company of $48.1 million, or $0.46 per share [15] - Liquidity position remains solid at $113 million, including $68.3 million in cash and cash equivalents [15] - The net debt to EBITDA ratio improved from 2.4 times to 2.1 times due to stronger EBITDA and debt repayments [15] Business Line Data and Key Metrics Changes - At Carriba, copper production increased by 25% compared to Q1, with a 50% reduction in unplanned infrastructure downtime [10][11] - Javancina saw a 17% increase in gold production versus Q1, with expectations for further improvements in the second half of the year [12] - Commercial production was announced at Tucumar, contributing to record consolidated copper production [8] Market Data and Key Metrics Changes - The company expects higher production levels in the second half of the year, which will aid in deleveraging efforts [15] - The foreign exchange hedge program had a total notional position of $240 million, with a modest realized gain of $200,000 during the quarter [16] Company Strategy and Development Direction - The company is focused on operational excellence, with significant groundwork laid for sustainable growth in production [6][7] - The strategy includes optimizing mining methods, enhancing cost control, and advancing long-term growth initiatives at Furnas [13] - The company aims to initiate returns to shareholders as part of its strategy moving forward [18] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving improved operational performance in the second half of the year, with expectations for continued growth in 2026 [9][10] - The focus is on achieving consistent production rates and addressing any remaining operational bottlenecks [22][36] - Management acknowledged the challenges faced in the first half of the year but emphasized the importance of the changes made for future stability [71][72] Other Important Information - The company completed its Phase one drill program at Furnas and is on track for the Phase two program [13] - The company is committed to delivering on its strategy and improving existing operations while preparing for future growth [18] Q&A Session Summary Question: Update on Tucumar's production capacity and guidance assumptions - Management confirmed that production levels have improved and are now operating at higher rates, with expectations to achieve around 80% of design capacity by year-end [20][23] Question: Cash costs at Carriba and guidance for the full year - Management indicated that while cash costs may trend higher due to lower grades in the second half, they expect to remain in the lower half of the guidance range [27][29] Question: Update on mechanized mining at Javancina and grade reconciliation - Initial results from mechanized mining have shown less dilution than manual mining, with grades expected to align with overall expectations for the year [30][31] Question: Remaining bottlenecks at Tucumar and July throughput - Management stated that the focus is now on preventative maintenance to ensure consistent operational performance, with no specific throughput numbers for July provided [34][36] Question: Update on shaft sinking at Pilar - The shaft project is progressing well, with expectations to be operational in 2027 [40] Question: Contribution from the sorghum pit and mining tonnage outperformance - Management highlighted that operational excellence initiatives have contributed to outperformance in mining tonnage, with Serbeam being an important contributor to production [44][46] Question: Timeline for starting cash returns to shareholders - Management indicated that the focus remains on deleveraging the balance sheet before considering shareholder returns [78]

Financial Performance - Cash flow from operations increased to $90.3 million in Q2 2025 [22], a 39% increase compared to $65 million in Q1 2025 [58] - Adjusted EBITDA increased to $82.7 million in Q2 2025 [23], a 31% increase compared to $63 million in Q1 2025 [59] - Adjusted net income per share was $0.46 [23] in Q2 2025, compared to $0.35 in Q1 2025 [59] - Available liquidity was $113.3 million [22] as of June 30, 2025 Operational Highlights - Caraíba Operations copper production increased approximately 25% quarter-over-quarter [37], with a 7% reduction in cash costs [37] - Tucumã Operation copper production increased approximately 25% quarter-over-quarter [45] - Xavantina Operations gold production increased 17% quarter-over-quarter [54] Strategic Objectives - The company aims to achieve commercial production at Tucumã [25] - The company aims to deleverage the balance sheet, with the net debt leverage ratio decreasing to 2.1x from 2.4x at the end of Q1 2025 [26] - The company aims to advance long-term growth initiatives, including the completion of the Furnas Phase 1 Drill Program in July 2025 [26] - The company aims to initiate returns to shareholders [26]

Core Insights - Ero Copper Corp. reported quarterly earnings of $0.46 per share, exceeding the Zacks Consensus Estimate of $0.33 per share, and showing a significant increase from $0.18 per share a year ago, resulting in an earnings surprise of +39.39% [1] - The company achieved revenues of $163.51 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 0.68% and up from $117.1 million year-over-year [2] - Ero Copper has outperformed consensus EPS estimates three times over the last four quarters, although it has only topped revenue estimates once in the same period [2] Earnings Outlook - The future performance of Ero Copper's stock will largely depend on management's commentary during the earnings call and the trends in earnings estimate revisions [3][4] - The current consensus EPS estimate for the upcoming quarter is $0.64 on revenues of $223.2 million, and for the current fiscal year, it is $1.91 on revenues of $789.82 million [7] Industry Context - The Mining - Non Ferrous industry, to which Ero Copper belongs, is currently ranked in the top 24% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked by investors [5]

Core Insights - Ero Copper Corp. reported record copper production of 15,513 tonnes in Q2 2025, driven by the ramp-up of the Tucumã Operation and improved performance at the Caraíba Operations [2][3] - The company achieved commercial production at Tucumã effective July 1, 2025, with a 25% increase in copper production from Q1 2025 [2][3] - Financial results showed a net income of $70.5 million, with adjusted EBITDA of $82.7 million, reflecting strong operational performance and higher metal prices [2][14] Production Highlights - Caraíba Operations produced 9,162 tonnes of copper in concentrate at an average C1 cash cost of $2.07 per pound, marking a 25% quarter-on-quarter production growth [2][9] - Tucumã Operation produced 6,351 tonnes of copper in concentrate, a 25% increase from Q1 2025, with sustained plant throughput exceeding 75% of design capacity [2][9] - Gold production reached 7,743 ounces at an average C1 cash cost of $1,115 per ounce, representing a 17% increase in production quarter-on-quarter [2][9] Financial Performance - Revenues for Q2 2025 were $163.5 million, up from $125.1 million in Q1 2025, with gross profit increasing to $67.3 million [14] - Adjusted net income attributable to owners was $48.1 million, with a diluted earnings per share of $0.46 [14][32] - Available liquidity at quarter-end was $113.3 million, including $68.3 million in cash and cash equivalents [2][14] Guidance Updates - Full-year copper production guidance has been updated to 67,500 to 80,000 tonnes, reflecting slower-than-expected ramp-up at Tucumã [15] - Updated guidance for Tucumã is set at 30,000 to 37,500 tonnes with C1 cash costs of $1.10 to $1.30 per pound [15][17] - Gold production guidance for Xavantina Operations has been revised to 40,000 to 50,000 ounces, with C1 cash costs of $850 to $1,000 per ounce [16][17] Operational Initiatives - Ongoing initiatives at Caraíba include enhancing operational efficiency and cost control, focusing on upper levels of the Pilar Mine to reduce haul distances [2][4] - Investments in mine modernization and mechanization at Xavantina are expected to drive higher production rates in H2 2025 [2][4] - The company completed 18,000 meters of drilling at the Furnas Project, with a focus on extending known mineralization [2][3]

MANAGEMENT'S DISCUSSION AND ANALYSIS FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 2025 1050 – 625 Howe Street, Vancouver, B.C., Canada V6C 2T6 Phone: 604-449-9244 | Website: www.erocopper.com | Email: info@erocopper.com TABLE OF CONTENTS | BUSINESS OVERVIEW | 1 | | --- | --- | | HIGHLIGHTS | 2 | | REVIEW OF OPERATIONS | | | The Caraíba Operations | 6 | | The Tucumã Operation | 7 | | The Xavantina Operations | 8 | | 2025 GUIDANCE | 9 | | REVIEW OF FINANCIAL RESULTS | | | Review of quarterly results | 11 | | R ...

Group 1 - Ero Copper Corp. (ERO) stock closed at $14.46, reflecting a +1.76% change from the previous day, outperforming the S&P 500's gain of 0.14% [1] - Prior to the recent trading session, ERO shares had declined by 6.76%, underperforming the Basic Materials sector's gain of 2.1% and the S&P 500's gain of 5.35% [1] Group 2 - The upcoming earnings report for Ero Copper Corp. is scheduled for July 31, 2025, with projected EPS of $0.38, indicating a 111.11% increase year-over-year [2] - Quarterly revenue is expected to reach $182.9 million, representing a 56.19% increase from the same period last year [2] Group 3 - Full-year Zacks Consensus Estimates predict earnings of $1.92 per share and revenue of $781.65 million, reflecting year-over-year changes of +146.15% and +66.24%, respectively [3] Group 4 - Recent revisions to analyst forecasts for Ero Copper Corp. are important as they indicate the evolving short-term business trends and analysts' favorable outlook on the company's health and profitability [4] Group 5 - The Zacks Rank system, which incorporates estimate revisions, has shown that these changes correlate with near-term share price momentum [5] - Ero Copper Corp. currently holds a Zacks Rank of 3 (Hold), with a recent upward shift of 2.36% in the consensus EPS estimate [6] Group 6 - Ero Copper Corp. is trading at a Forward P/E ratio of 7.42, which is a discount compared to its industry's Forward P/E of 21.14 [7] - The Mining - Non Ferrous industry, part of the Basic Materials sector, has a Zacks Industry Rank of 39, placing it in the top 16% of over 250 industries [7]

Core Viewpoint - Ero Copper Corp. (ERO) shows potential for significant upside, with a mean price target of $19.52 indicating a 29.3% increase from the current price of $15.1 [1] Price Targets and Analyst Consensus - The average of 14 short-term price targets ranges from a low of $15.98 to a high of $25.00, with a standard deviation of $2.65, indicating variability in analyst estimates [2] - The lowest estimate suggests a 5.8% increase, while the highest points to a 65.6% upside [2] - A low standard deviation indicates a high degree of agreement among analysts regarding the stock's price movement [9] Earnings Estimates and Market Sentiment - Analysts have shown increasing optimism about ERO's earnings prospects, with a strong consensus in revising EPS estimates higher, which correlates with potential stock price increases [11] - The Zacks Consensus Estimate for the current year has risen by 2% over the past month, with two estimates increasing and one decreasing [12] - ERO holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimates [13] Caution on Price Targets - While price targets are commonly referenced, they can mislead investors, as empirical research shows they rarely indicate actual stock price movements [7][10] - Analysts may set overly optimistic price targets due to business incentives, which can inflate expectations [8]

Core Insights - Ero Copper Corp. is a copper producer experiencing significant growth, with earnings expected to increase by 165% this year due to record-high copper prices [1][7][8] Company Overview - Ero Copper is headquartered in Vancouver, B.C., and operates primarily in Brazil, with a market capitalization of $1.5 billion [1] - The company holds a 99.6% interest in Mineracao Caraiba S.A., which owns the Caraiba and Tucuma Operations [1] - Ero Copper also owns 97.6% of NX Gold S.A., which operates the Xavantina gold and silver mine in Brazil [2] Recent Developments - The Tucuma Operation achieved commercial production as of July 1, 2025, with copper production totaling approximately 6,400 tonnes in Q2 2025 [3][7] - Ero Copper reported a strong Q1 2025, with earnings of $0.35 per share, significantly exceeding the consensus estimate of $0.17 [4] - The company reaffirmed its full-year expenditure guidance of $230 to $270 million, anticipating growth in copper production in the second half of the year [6] Financial Performance - The average C1 cash cost at the Caraiba operation was $2.22 per pound, while at the Xavantina operations, it was $1,100 per ounce with an All-in Sustaining Cost of $2,228 per ounce [4] - Ero Copper has a streaming agreement with Royal Gold, generating total proceeds of $160 million as of the end of Q1 2025 [5] - The company had available liquidity of $115.6 million at the end of Q1 2025, including $80.6 million in cash [5] Market Outlook - Analysts are optimistic about Ero Copper, with the Zacks Consensus Estimate for 2025 earnings raised to $2.07 from $2.02, reflecting a growth of 165.4% compared to last year's earnings of $0.78 [8] - The Zacks Consensus for 2026 earnings has also increased to $2.78 from $2.61, indicating a growth of 34.1% [9] - Ero Copper shares have rallied significantly over the last three months, outperforming the small-cap index, Russell 2000 [10] Valuation - Ero Copper is considered undervalued, trading at a forward price-to-earnings (P/E) ratio of 6.9 [12]

Core Viewpoint - Ero Copper Corp. has successfully completed its Phase 1 drill program at the Furnas Copper-Gold Project, revealing significant down-dip mineralization and extending known limits, which positions the project as a potential large-scale, high-grade underground mining operation [1][4][6]. Group 1: Drill Program Details - The Phase 1 drill program consisted of 28,000 meters, with results received for approximately 10,000 meters, demonstrating continuity and extending mineralization to a maximum depth of 730 meters [1][2]. - Only one of the 66 holes drilled did not intercept mineralization, indicating a high success rate in the drilling campaign [2]. - The program included infill drilling to confirm high-grade mineralization continuity and step-out drilling to extend known mineralization limits [2][4]. Group 2: Mineral Resource Estimates - The current NI 43-101 mineral resource estimate is based on historical drilling averaging 300 meters in depth, with a maximum localized depth of 580 meters [1][6]. - The indicated mineral resource is estimated at 35.2 million tonnes grading 1.04% copper and 0.69 grams per tonne gold (1.36% CuEq), while inferred resources total 61.3 million tonnes grading 1.06% copper and 0.63 grams per tonne gold (1.36% CuEq) [14]. Group 3: Future Plans - The company is advancing to a Phase 2 drill campaign, expected to comprise a minimum of 17,000 meters, with a greater focus on step-out drilling [5][6]. - The complete results from the Phase 1 program will inform an updated NI 43-101 mineral resource estimate and a preliminary economic assessment (PEA) scheduled for completion in the first half of 2026 [6][9]. Group 4: Project Location and Infrastructure - The Furnas Project is located in the Carajás Mineral Province in Pará State, Brazil, approximately 50 kilometers from Vale Base Metals' Salobo operations and 190 kilometers from Ero's Tucumã Operations [7][8]. - The project area covers approximately 2,400 hectares and is near extensive regional infrastructure, including paved roads and a power substation [8]. Group 5: Partnership and Agreements - In July 2024, Ero Copper signed an earn-in agreement with Salobo Metais S.A., a subsidiary of Vale Base Metals, to earn a 60% interest in the project by completing exploration and development milestones over five years [9][35].