NOVAGOLD(NG) - 2025 Q2 - Quarterly Results

Financial Highlights NOVAGOLD reported a net loss of $54.3 million, primarily due to a $39.6 million non-cash charge, with treasury strengthened to $319 million Q2 2025 Financial Results | Metric | Value (in thousands of U.S. dollars) | | :--- | :--- | | Net Earnings | ($54,275) | | Earnings Per Share | ($0.15) | | Non-cash, Non-recurring Warrant Charge | $39,607 | | Net Cash Expenditures | $8,300 | | - Donlin Gold Funding | $6,800 | | - Corporate G&A Costs | $1,600 | - As of May 31, 2025, NOVAGOLD held approximately $319 million in cash and term deposits after closing a public equity offering and private placement[4] - Subsequent to the quarter's end, after closing the Donlin Gold Transaction and the overallotment option, NOVAGOLD's pro-forma treasury was approximately $136 million in cash and term deposits[6] Key Milestones and Strategic Achievements NOVAGOLD acquired Barrick's 50% Donlin Gold interest, increasing its stake to 60%, funded by a $234 million equity offering, and advanced the 15,000-meter drill program - Announced and closed a pivotal $1 billion transaction with Paulson Advisers to acquire Barrick's 50% interest in Donlin Gold LLC, increasing NOVAGOLD's ownership to 60%[2][8][12] - Strengthened the treasury by completing a public equity offering and private placement of 65 million shares, resulting in approximately $234 million in net proceeds to fund the acquisition and future work[9][12] - The Donlin Gold 15,000-meter drill program is underway, with approximately 8,401 meters completed, and is now focused on converting and expanding reserves and resources[9][12][16] - Initiated preparations for an updated Feasibility Study, with contracts expected to be awarded by year-end[12] President's Message The President highlighted the transformational quarter, marked by the new partnership with Paulson Advisers to increase NOVAGOLD's Donlin Gold ownership to 60% and advance the project A New Partnership Marks a Pivotal Catalyst to Advance Donlin Gold The partnership with Paulson Advisers is a major catalyst for Donlin Gold, which holds approximately 39 million ounces of gold at 2.24 g/t - The partnership with Paulson Advisers is a major milestone, underscoring the exceptional quality of the Donlin Gold project[14] - Donlin Gold is one of the largest known undeveloped gold deposits with approximately 39 million ounces in Measured and Indicated Resources at a grade of 2.24 g/t[15] Adding Valuation Through the Drill Bit Donlin Gold completed 8,401 meters of its 15,000-meter drill program, now focused on resource conversion and expansion - The 15,000-meter drill program pivoted on May 4, 2025, to prioritize resource conversion and expansion[16] - A total of 8,401 meters out of a planned 15,000 meters was completed by the end of the second quarter[16] Reinforcing the Project's Importance Through Engagement and Support Donlin Gold actively engaged with stakeholders and local communities, supporting environmental and safety initiatives like 'Clean-up Green-up' - Management met with the Alaska Congressional delegation, Governor, and other officials to reinforce the project's importance to the state and Y-K region[17] - Conducted community meetings, including one in Crooked Creek and the fifth Subsistence Community Advisory Committee (SCAC) meeting at the project site[18] - Supported the annual "Clean-up Green-up" program in 47 communities and the Summer Safety Program along the Kuskokwim River[25][26] Project Development and Permitting Status NOVAGOLD and Donlin Gold are defending key state permits in litigation, with Alaska Supreme Court decisions expected in 2025, and advancing Dam Safety Certificates - Litigation regarding state water rights permits and the pipeline Right-of-Way has been argued before the Alaska Supreme Court, with decisions expected in 2025[27] - A federal court denied a request to vacate the project's permits and remanded a narrow issue on tailings analysis to the agencies for supplementation, while keeping the permits in place[28] - The company is advancing Dam Safety Certificates, with comments from the Alaska Department of Natural Resources (ADNR) expected in 2025 and bids for detailed design work under evaluation[29] Financial Position and Outlook NOVAGOLD's cash and term deposits significantly increased due to an equity offering, leading to higher Donlin Gold funding and G&A expenses, with an updated forecast in Q3 Selected Balance Sheet Data (in thousands of U.S. dollars) | | May 31, 2025 | May 31, 2024 | | :--- | :--- | :--- | | Cash and term deposits | $318,737 | $112,568 | | Total assets | $329,295 | $121,577 | | Total liabilities | $164,018 | $149,049 | - Cash equivalents increased by $251.5 million in the first six months of 2025, primarily due to $243.8 million in net proceeds from the public equity offering and private placement[35] - The company expects its share of Donlin Gold funding and corporate G&A cash expenditures to be significantly higher than the previously issued 2025 guidance of $21.5 million and $16.0 million, respectively[38] - Near-term priorities include commencing the Feasibility Study update, executing the 2025 drill program, and supporting state permitting efforts[31] Corporate Information NOVAGOLD is a well-financed precious metals company focused on developing the Donlin Gold project, with a conference call and webcast scheduled for Q2 results - NOVAGOLD is focused on developing the Donlin Gold project, which has approximately 39 million ounces of gold in Measured and Indicated Mineral Resource categories[45] Conference Call & Webcast Details | | Details | | :--- | :--- | | Video Webcast: | www.novagold.com/investors/events/ | | North American callers: | 1-833-752-3655 | | International callers: | 1-647-846-8520 | - The Q3 2025 results and a Donlin Gold project update will be released on Wednesday, October 1, 2025[44]