Taseko(TGB) - 2025 Q2 - Quarterly Report

Condensed Consolidated Interim Financial Statements Overview This section provides an overview of Taseko Mines Limited's interim financial position, performance, cash flows, and equity changes, along with detailed notes on accounting policies and specific financial items Condensed Consolidated Interim Balance Sheets The balance sheet shows a decrease in current assets and an increase in total assets for Taseko Mines Limited as of June 30, 2025, compared to December 31, 2024. Total liabilities also increased, while total equity saw a significant rise Key Balance Sheet Figures (Cdn$ in thousands) | Metric | June 30, 2025 (Cdn$ '000) | December 31, 2024 (Cdn$ '000) | | :-------------------------------- | :------------ | :---------------- | | Cash | 121,988 | 172,732 | | Current assets | 235,326 | 353,239 | | Property, plant and equipment | 1,954,246 | 1,770,102 | | Total Assets | 2,262,759 | 2,195,043 | | Current liabilities | 230,719 | 206,836 | | Total Liabilities | 1,702,824 | 1,691,821 | | Total Equity | 559,935 | 503,222 | - Current assets decreased by Cdn$117.9 million (33.4%) from December 31, 2024, to June 30, 2025, primarily due to a reduction in cash and inventories[2] - Total equity increased by Cdn$56.7 million (11.3%) from December 31, 2024, to June 30, 2025, driven by share capital increases and a reduction in deficit[2] Condensed Consolidated Interim Statements of Comprehensive (Loss) Income The company reported a net income for the three months ended June 30, 2025, reversing a loss from the prior year, but a net loss for the six months ended June 30, 2025, compared to a net income in the prior year. Revenues decreased across both periods, while earnings from mining operations saw a significant decline Key Income Statement Figures (Cdn$ in thousands) | Metric | 3 Months Ended June 30, 2025 (Cdn$ '000) | 3 Months Ended June 30, 2024 (Cdn$ '000) | 6 Months Ended June 30, 2025 (Cdn$ '000) | 6 Months Ended June 30, 2024 (Cdn$ '000) | | :----------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Revenues | 116,082 | 137,730 | 255,231 | 284,677 | | Earnings (loss) from mining operations | (502) | 44,948 | 15,864 | 69,367 | | Net (loss) income | 21,868 | (10,953) | (6,692) | 7,943 | | Basic (loss) earnings per share | 0.07 | (0.04) | (0.02) | 0.03 | | Diluted (loss) earnings per share | 0.07 | (0.04) | (0.02) | 0.03 | - Revenues decreased by 15.8% for the three months ended June 30, 2025, and by 10.3% for the six months ended June 30, 2025, compared to the same periods in 2024[3] - Net income for the three months ended June 30, 2025, was Cdn$21.9 million, a significant improvement from a Cdn$11.0 million loss in the prior year, primarily driven by a Cdn$39.1 million foreign exchange gain[3] Condensed Consolidated Interim Statements of Cash Flows Cash provided by operating activities decreased for both the three and six months ended June 30, 2025, compared to 2024. Investing activities continued to be a significant cash outflow, increasing substantially, while financing activities provided cash, though less than the prior year for the six-month period Key Cash Flow Figures (Cdn$ in thousands) | Metric | 3 Months Ended June 30, 2025 (Cdn$ '000) | 3 Months Ended June 30, 2024 (Cdn$ '000) | 6 Months Ended June 30, 2025 (Cdn$ '000) | 6 Months Ended June 30, 2024 (Cdn$ '000) | | :-------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Cash provided by operating activities | 25,954 | 34,711 | 81,846 | 94,285 | | Cash used for investing activities | (127,330) | (80,801) | (258,258) | (127,486) | | Cash provided by financing activities | 104,783 | 87,011 | 126,275 | 135,511 | | (Decrease) increase in cash | 1,210 | 40,966 | (50,744) | 102,150 | | Cash, end of period | 121,988 | 198,627 | 121,988 | 198,627 | - Cash used for investing activities more than doubled for the six months ended June 30, 2025, reaching Cdn$258.3 million, primarily due to increased Florence Copper development costs and Gibraltar capital expenditures[4] - The company experienced a Cdn$50.7 million decrease in cash for the six months ended June 30, 2025, contrasting with a Cdn$102.2 million increase in the same period of 2024[4] Condensed Consolidated Interim Statements of Changes in Equity Total equity increased from December 31, 2024, to June 30, 2025, driven by share issuances and share-based compensation, partially offset by a total comprehensive loss for the period Key Equity Changes (Cdn$ in thousands) | Metric | As at December 31, 2024 (Cdn$ '000) | As at June 30, 2025 (Cdn$ '000) | | :----------------------------------- | :---------------------- | :------------------ | | Share capital | 529,413 | 562,446 | | Contributed surplus | 57,786 | 60,153 | | Accumulated other comprehensive income | 52,845 | 21,357 | | Deficit | (136,822) | (84,022) | | Total Equity | 503,222 | 559,935 | - Share capital increased by Cdn$33.0 million from share issuances and exercise of options during the six months ended June 30, 2025[5] - The deficit decreased by Cdn$52.8 million, largely due to the sale of a non-controlling interest in the New Prosperity Project, which resulted in a Cdn$68.8 million gain recognized directly in equity[5] Notes to the Condensed Consolidated Interim Financial Statements This section provides detailed explanations and disclosures supporting the condensed consolidated interim financial statements 1. REPORTING ENTITY Taseko Mines Limited is a British Columbia-governed corporation primarily engaged in metal concentrate production and mine development in British Columbia, Canada, and Arizona, USA. The company's interest in Gibraltar mine increased to 100% after March 25, 2024, following the acquisition of Cariboo Copper Corporation - Taseko Mines Limited is principally engaged in the production and sale of metal concentrates, as well as related activities, including mine permitting and development, within British Columbia, Canada, and Arizona, USA[6] - The company's interest in Gibraltar mine increased from 87.5% to 100% after March 25, 2024, due to the acquisition of Cariboo Copper Corporation[7] 2. MATERIAL ACCOUNTING POLICIES The interim financial statements comply with IFRS Accounting Standards. Management's judgments and estimates remain consistent with the prior annual statements, except for the partial disposal of the New Prosperity Project, where control was retained. New IFRS standards, including IFRS 18 and amendments to IFRS 9 and IFRS 7, are being evaluated for their impact - The unaudited condensed consolidated interim financial statements are prepared in compliance with IFRS Accounting Standards under IAS 34[8] - The company retained control of 1280860 (New Prosperity Project) after disposing of 22.5% of its common shares, as it maintains the ability to direct activities significantly affecting economic returns[13] - The company is evaluating the impact of new accounting standards, including IFRS 18 (effective January 1, 2027) and amendments to IFRS 9 and IFRS 7 (effective January 1, 2026)[14][15] 3. REVENUES Total revenues decreased for both the three and six months ended June 30, 2025, compared to 2024, primarily driven by lower copper contained in concentrate revenue, partially offset by an increase in gold revenue Revenue Breakdown (Cdn$ in thousands) | Revenue Source | 3 Months Ended June 30, 2025 (Cdn$ '000) | 3 Months Ended June 30, 2024 (Cdn$ '000) | 6 Months Ended June 30, 2025 (Cdn$ '000) | 6 Months Ended June 30, 2024 (Cdn$ '000) | | :-------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Copper contained in concentrate | 110,539 | 128,639 | 239,322 | 268,191 | | Molybdenum concentrate | 4,546 | 5,672 | 14,313 | 11,196 | | Silver | 755 | 815 | 2,496 | 2,542 | | Gold | 351 | - | 740 | - | | Total Revenues | 116,082 | 137,730 | 255,231 | 284,677 | - Copper contained in concentrate revenue decreased by Cdn$18.1 million (14.1%) for the three months and Cdn$28.9 million (10.8%) for the six months ended June 30, 2025, compared to the prior year[17] - Gold revenue, which was zero in 2024, contributed Cdn$351 thousand and Cdn$740 thousand for the three and six months ended June 30, 2025, respectively[17] 4. COST OF SALES AND OTHER OPERATING (INCOME) COSTS Cost of sales increased for both the three and six months ended June 30, 2025, primarily due to higher depletion and amortization. Other operating income included a significant research and development tax credit in 2025, contrasting with crusher relocation costs and an insurance recovery in 2024 Cost of Sales and Other Operating (Income) Costs (Cdn$ in thousands) | Metric | 3 Months Ended June 30, 2025 (Cdn$ '000) | 3 Months Ended June 30, 2024 (Cdn$ '000) | 6 Months Ended June 30, 2025 (Cdn$ '000) | 6 Months Ended June 30, 2024 (Cdn$ '000) | | :----------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Production costs | 95,382 | 94,916 | 195,740 | 202,420 | | Depletion and amortization | 25,210 | 13,721 | 47,635 | 28,745 | | Cost of sales | 120,592 | 108,637 | 243,375 | 231,165 | | Other operating (income) costs | (4,008) | 10,435 | (4,008) | 10,435 | | Insurance recovery | - | (26,290) | - | (26,290) | - Depletion and amortization expense increased by 83.7% for the three months and 65.7% for the six months ended June 30, 2025, compared to the same periods in 2024[18] - The company recognized Cdn$4.0 million in research and development tax credits as other operating income during the three and six months ended June 30, 2025[19][20] - In 2024, the company recognized a Cdn$26.3 million insurance recovery related to business interruption and Cdn$7.9 million in crusher relocation costs[22][20] 5. DERIVATIVES AND OTHER FAIR VALUE INSTRUMENTS The company incurred higher net losses from derivatives and other fair value instruments for the six months ended June 30, 2025, primarily due to increased unrealized losses on outstanding copper options and collars and fair value adjustments on the Florence copper stream derivative Changes in Derivatives and Other Fair Value Instruments (Cdn$ in thousands) | Metric | 3 Months Ended June 30, 2025 (Cdn$ '000) | 3 Months Ended June 30, 2024 (Cdn$ '000) | 6 Months Ended June 30, 2025 (Cdn$ '000) | 6 Months Ended June 30, 2024 (Cdn$ '000) | | :--------------------------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Net loss on copper price and fuel contracts | 2,433 | 10,465 | 25,552 | 13,094 | | Fair value adjustment on Cariboo contingent payments | 5,136 | - | 1,826 | - | | Fair value adjustment on Florence copper stream derivative | 3,486 | 1,223 | 8,766 | 3,815 | | Total Changes in derivatives and other fair value instruments | 11,055 | 11,688 | 36,144 | 16,909 | - Unrealized loss on outstanding copper options and collars significantly increased to Cdn$22.7 million for the six months ended June 30, 2025, from Cdn$9.7 million in the prior year[23] - The Florence Copper Stream, a financial liability measured at fair value, was valued at Cdn$86.4 million as of June 30, 2025, with a Cdn$8.8 million fair value adjustment recognized during the six-month period[29][30] a) Derivatives and other Financial Instruments measured at fair value%20Derivatives%20and%20other%20Financial%20Instruments%20measured%20at%20fair%20value) This section details the fair value measurements and changes in derivative and other financial instruments Fair Value Gains/Losses (Cdn$ in thousands) | Item | 3 Months Ended June 30, 2025 (Cdn$ '000) | 3 Months Ended June 30, 2024 (Cdn$ '000) | 6 Months Ended June 30, 2025 (Cdn$ '000) | 6 Months Ended June 30, 2024 (Cdn$ '000) | | :--------------------------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Realized loss on settled copper options and collars | 1,285 | 1,556 | 2,571 | 3,192 | | Unrealized loss on outstanding copper options and collars | 1,084 | 8,874 | 22,662 | 9,737 | | Realized loss on fuel call options | 281 | 99 | 548 | 165 | | Unrealized gain fuel call options | (217) | (64) | (229) | - | | Net loss on copper price and fuel contracts | 2,433 | 10,465 | 25,552 | 13,094 | | Fair value adjustment on Cariboo contingent performance payments | 5,136 | - | 1,826 | - | | Fair value adjustment on Florence copper stream derivative | 3,486 | 1,223 | 8,766 | 3,815 | | Changes in derivatives and other fair value instruments | 11,055 | 11,688 | 36,144 | 16,909 | b) Copper Collars and Fuel Contracts%20Copper%20Collars%20and%20Fuel%20Contracts) This section outlines the company's outstanding copper collars and fuel contracts, including their quantities, strike prices, and fair values - No new derivative transactions were entered into by the Company during the six months ended June 30, 2025[24] Outstanding Copper Collars as at June 30, 2025 | Quantity | Strike price | Period | Cost (Cdn$ '000) | Fair value (Cdn$ '000) | | :----------- | :------------------ | :------- | :----- | :--------- | | 54 million lbs | US$4.00 per lb | H2 2025 | 2,222 | 1,334 | | | US$5.40 per lb | | | | c) Florence Copper Stream%20Florence%20Copper%20Stream) This section details the Florence Copper Stream agreement, including received installments, valuation, and continuity of the financial liability - The Company received the final US$10 million installment of the US$50 million Copper Stream from Mitsui on January 27, 2025, for the Florence Copper project[26] - The Florence Copper Stream and Buy Back Option were valued at Cdn$86.4 million as at June 30, 2025, based on estimates of future production and copper prices[29] Florence Copper Stream Continuity (Cdn$ in thousands) | Item | Amount (Cdn$ '000) | | :-------------------------------------- | :----- | | Florence Copper Stream as at December 31, 2024 | 67,813 | | Advance from Florence Copper Stream (US$10 million) | 14,381 | | Fair value adjustment | 8,766 | | Foreign exchange translation | (4,516) | | Florence Copper Stream as at June 30, 2025 | 86,444 | | Less current portion | 3,349 | | Long-term portion as at June 30, 2025 | 83,095 | 6. FINANCE AND ACCRETION EXPENSE Finance expense decreased for the three months but increased for the six months ended June 30, 2025, primarily due to changes in interest expense and capitalized interest. Accretion expense saw a slight increase for both periods Finance and Accretion Expense (Cdn$ in thousands) | Expense Type | 3 Months Ended June 30, 2025 (Cdn$ '000) | 3 Months Ended June 30, 2024 (Cdn$ '000) | 6 Months Ended June 30, 2025 (Cdn$ '000) | 6 Months Ended June 30, 2024 (Cdn$ '000) | | :----------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Finance expense | 10,228 | 12,880 | 22,435 | 25,692 | | Accretion expense | 13,715 | 13,037 | 20,385 | 20,074 | - Interest expense capitalized for the Florence Copper project increased to Cdn$13.3 million for the six months ended June 30, 2025, from Cdn$8.7 million in the prior year[31] - Accretion on Florence royalty obligation significantly increased to Cdn$8.8 million for the six months ended June 30, 2025, from Cdn$5.5 million in the prior year[31] 7. INCOME TAX The company recognized a significant income tax recovery for both the three and six months ended June 30, 2025, primarily due to a deferred income tax recovery related to the utilization of previously unrecognized net capital losses Income Tax (Recovery) Expense (Cdn$ in thousands) | Tax Type | 3 Months Ended June 30, 2025 (Cdn$ '000) | 3 Months Ended June 30, 2024 (Cdn$ '000) | 6 Months Ended June 30, 2025 (Cdn$ '000) | 6 Months Ended June 30, 2024 (Cdn$ '000) | | :----------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Current income tax (recovery) expense | (1,243) | 633 | (1,243) | 1,438 | | Deferred income tax (recovery) expense | (26,196) | (3,880) | (34,176) | 18,597 | | Income tax (recovery) expense | (27,439) | (3,247) | (35,419) | 20,035 | - The Cdn$26.2 million deferred income tax recovery for the three months ended June 30, 2025, includes Cdn$9.3 million related to the recognition of previously unrecognized net capital losses[32] 8. ACCOUNTS RECEIVABLE Total accounts receivable increased as of June 30, 2025, compared to December 31, 2024, driven by a significant rise in other receivables Accounts Receivable (Cdn$ in thousands) | Type | June 30, 2025 (Cdn$ '000) | December 31, 2024 (Cdn$ '000) | | :-------------------------- | :------------ | :---------------- | | Trade and settlement receivables | 4,116 | 5,397 | | Other receivables | 2,175 | 246 | | Total Accounts receivable | 6,291 | 5,643 | - Other receivables increased by Cdn$1.9 million from December 31, 2024, to June 30, 2025[33] 9. INVENTORIES Current inventories decreased significantly as of June 30, 2025, primarily due to a reduction in sulphide ore stockpiles, while long-term inventories increased with the addition of oxide ore on leach pads Inventories Breakdown (Cdn$ in thousands) | Inventory Type | June 30, 2025 (Cdn$ '000) | December 31, 2024 (Cdn$ '000) | | :-------------------------- | :------------ | :---------------- | | Current: | | | | Copper concentrate | 11,634 | 14,932 | | Sulphide ore stockpiles | 17,799 | 76,696 | | Oxide ore on leach pads | 7,274 | - | | Materials and supplies | 55,603 | 46,620 | | Total Current Inventories | 95,664 | 138,890 | | Long-term: | | | | Oxide ore on leach pads | 22,488 | - | | Oxide ore stockpiles | 30,286 | 39,586 | | Total Long-term Inventories | 52,774 | 39,586 | - Current sulphide ore stockpiles decreased by Cdn$58.9 million from December 31, 2024, to June 30, 2025[34] - Oxide ore on leach pads appeared as a new inventory category in both current (Cdn$7.3 million) and long-term (Cdn$22.5 million) inventories as of June 30, 2025[34] 10. OTHER FINANCIAL ASSETS Current other financial assets decreased significantly as of June 30, 2025, primarily due to a substantial reduction in copper price options, while long-term other financial assets remained stable Other Financial Assets (Cdn$ in thousands) | Asset Type | June 30, 2025 (Cdn$ '000) | December 31, 2024 (Cdn$ '000) | | :-------------------------- | :------------ | :---------------- | | Current: | | | | Marketable securities | 1,581 | 895 | | Copper price options | 1,334 | 26,568 | | Fuel call options | - | 332 | | Total Current | 2,915 | 27,795 | | Long-term: | | | | Investment in private companies | 500 | 500 | | Reclamation deposits | 459 | 459 | | Total Long-term | 959 | 959 | - Copper price options decreased by Cdn$25.2 million from December 31, 2024, to June 30, 2025[35] 11. PROPERTY, PLANT AND EQUIPMENT The net book value of property, plant and equipment increased as of June 30, 2025, driven by significant additions, particularly in construction in progress and mineral properties. Florence Copper and Gibraltar segments saw substantial net additions Property, Plant and Equipment Net Book Value (Cdn$ in thousands) | Metric | As at December 31, 2024 (Cdn$ '000) | As at June 30, 2025 (Cdn$ '000) | | :----------------------------------- | :---------------------- | :------------------ | | Total Net Book Value | 1,770,102 | 1,954,246 | | Gibraltar Mine | 925,911 | 997,917 | | Florence Copper | 800,935 | 910,972 | | Yellowhead | 25,762 | 27,555 | - Total additions to PPE for the six months ended June 30, 2025, amounted to Cdn$265.5 million, with Cdn$127.9 million in construction in progress[37] - The Florence Copper project capitalized Cdn$142.0 million in development costs and Cdn$13.3 million in borrowing costs for the six months ended June 30, 2025[37] 12. ACQUISITION OF CARIBOO COPPER CORPORATION On March 25, 2024, Taseko acquired the remaining 50% interest in Cariboo Copper Corporation, increasing its effective interest in Gibraltar to 100%. This acquisition resulted in a bargain purchase gain of Cdn$47.4 million and a gain of Cdn$15.0 million from the remeasurement of the previously held 87.5% interest in Gibraltar at fair value - The acquisition of 50% of Cariboo Copper Corporation on March 25, 2024, increased Taseko's effective interest in Gibraltar mine to 100%[39] - A bargain purchase gain of Cdn$47.4 million was recognized due to the difference between the fair value of net assets acquired (Cdn$118.5 million) and the consideration payable (Cdn$71.1 million)[41] - A gain of Cdn$14.98 million was recognized from the remeasurement of the previously held 87.5% interest in Gibraltar at fair value upon gaining control[43] 13. DEBT Total debt increased as of June 30, 2025, primarily due to advances from the revolving credit facility and new lease liabilities, partially offset by principal payments and foreign exchange movements. The company issued US$500 million senior secured notes in April 2024 and maintains various equipment loans and credit facilities Total Debt Breakdown (Cdn$ in thousands) | Debt Type | As at December 31, 2024 (Cdn$ '000) | As at June 30, 2025 (Cdn$ '000) | | :-------------------------- | :---------------------- | :------------------ | | Senior secured notes | 715,646 | 679,040 | | Revolving credit facility | - | 75,036 | | Gibraltar equipment loans | 48,998 | 38,596 | | Florence equipment loans | 29,158 | 29,028 | | Lease liabilities | 13,296 | 19,021 | | Total Debt | 807,098 | 840,721 | | Long-term debt | 764,355 | 794,121 | - The company completed an offering of US$500 million senior secured notes in April 2024, maturing on May 1, 2030, with an annual interest rate of 8.25%[45] - As of June 30, 2025, US$55 million was advanced under the secured US$110 million revolving credit facility, which matures on November 2, 2027[48] 14. CARIBOO CONSIDERATION PAYABLE TO PRIOR OWNERS OF CARIBOO The total Cariboo consideration payable decreased slightly as of June 30, 2025, due to payments made, partially offset by fair value adjustments and accretion. This liability includes minimum and contingent payments to Sojitz, Dowa, and Furukawa, with contingent payments dependent on LME copper prices Cariboo Consideration Payable (Cdn$ in thousands) | Item | As at December 31, 2024 (Cdn$ '000) | As at June 30, 2025 (Cdn$ '000) | | :----------------------------------- | :---------------------- | :------------------ | | Sojitz | 72,209 | 58,381 | | Dowa and Furukawa | 73,659 | 77,816 | | Total Cariboo consideration payable | 145,868 | 136,197 | | Less current portion | (16,447) | (30,331) | | Long-term portion | 129,421 | 105,866 | - The contingent payment of Cdn$6.6 million for the 2024 calendar year to Sojitz was paid on April 1, 2025[59] - The Dowa and Furukawa Contingent Performance Payments liability is estimated to have nil value as at June 30, 2025, and December 31, 2024[61] 15. FLORENCE ROYALTY OBLIGATION The Florence Royalty Obligation, a perpetual gross revenue royalty interest, increased as of June 30, 2025, due to accretion, partially offset by foreign exchange translation. The company recorded Cdn$8.8 million in accretion expense for the six months ended June 30, 2025 Florence Royalty Obligation (Cdn$ in thousands) | Item | Amount (Cdn$ '000) | | :-------------------------------------- | :----- | | Balance as at December 31, 2024 | 84,383 | | Accretion | 8,772 | | Foreign exchange translation | (4,569) | | Balance as at June 30, 2025 | 88,586 | | Less current portion | 3,428 | | Long-term portion as at June 30, 2025 | 85,158 | - The company received US$50 million from Taurus Mining Royalty Fund L.P. on February 2, 2024, for a 2.05% perpetual gross revenue royalty interest in Florence Copper[64] - Accretion on the royalty obligation for the six months ended June 30, 2025, was Cdn$8.8 million, an increase from Cdn$5.5 million in the prior year[65] 16. DEFERRED REVENUE Total deferred revenue increased as of June 30, 2025, primarily due to higher customer advance payments and accretion on the Osisko silver stream agreement, partially offset by revenue recognition Deferred Revenue Breakdown (Cdn$ in thousands) | Item | June 30, 2025 (Cdn$ '000) | December 31, 2024 (Cdn$ '000) | | :----------------------------------- | :------------ | :---------------- | | Current portion of deferred revenue | 15,393 | 13,666 | | Long-term portion of Osisko silver stream agreement | 81,366 | 77,327 | | Total deferred revenue | 96,759 | 90,993 | - Customer advance payments increased to Cdn$7.4 million as of June 30, 2025, from Cdn$4.3 million at December 31, 2024[68] - The Osisko silver stream agreement was amended on December 20, 2024, with the company receiving US$12.7 million for the sale of an equivalent amount of the remaining 12.5% share of Gibraltar payable silver production[70] 17. EQUITY The company completed its At-the-market Equity Offering Program (ATM) during the three months ended March 31, 2025, issuing over 22.6 million shares for total gross proceeds of US$49.976 million (Cdn$69.881 million) - The At-the-market Equity Offering Program (ATM) for up to US$50 million was fully subscribed and completed during the three months ended March 31, 2025[73] ATM Program Issuance Details | Metric | Amount | | :----------------------------------- | :----- | | Total shares issued under ATM | 22,627,320 | | Total gross proceeds (US$) | 49,976 | | Total gross proceeds (Cdn$) | 69,881 | | Shares issued during Q1 2025 | 10,566,354 | | Gross proceeds during Q1 2025 (US$) | 21,519 | | Gross proceeds during Q1 2025 (Cdn$) | 30,994 | 18. PARTIAL DISPOSAL OF NEW PROSPERITY PROJECT On June 5, 2025, the company transferred 22.5% of its New Prosperity Project to the Tsilhqot'in Nation in exchange for Cdn$75 million in cash. The company retained control of the entity, and the transaction was accounted for as an equity transaction, resulting in a net realized gain of Cdn$68.8 million recognized directly in equity - On June 5, 2025, the company transferred 22.5% of the common shares of the entity owning the New Prosperity Project to the Tsilhqot'in Nation, receiving Cdn$75 million in cash[75] - The company retained a 77.5% shareholder interest and concluded it continues to control the entity, leading to the transaction being accounted for as an equity transaction with no gain or loss recognized in the statement of comprehensive (loss) income[77] - The transaction resulted in a net realized gain of Cdn$68.8 million recognized directly in equity[78] 19. SHARE-BASED COMPENSATION Share-based compensation expense increased for both the three and six months ended June 30, 2025, primarily driven by a significant change in the fair value of deferred share units. The company granted new share options and various share units during the period Share-based Compensation Expense (Cdn$ in thousands) | Expense Type | 3 Months Ended June 30, 2025 (Cdn$ '000) | 3 Months Ended June 30, 2024 (Cdn$ '000) | 6 Months Ended June 30, 2025 (Cdn$ '000) | 6 Months Ended June 30, 2024 (Cdn$ '000) | | :----------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Share options expense | 703 | 565 | 3,078 | 2,103 | | Performance share units expense | 778 | 679 | 1,556 | 1,357 | | Restricted share units expense | 231 | 143 | 481 | 294 | | Change in fair value of deferred share units | 3,099 | 1,198 | 5,046 | 4,498 | | Total Share-based compensation expense | 4,740 | 2,512 | 9,744 | 7,952 | - Share-based compensation expense increased by 88.7% for the three months and 22.5% for the six months ended June 30, 2025, compared to the same periods in 2024[83] - The company granted 2,813,300 share options during the six months ended June 30, 2025, with an average exercise price of Cdn$3.06 per share[79] 20. (LOSS) EARNINGS PER SHARE Basic and diluted earnings per share showed a positive Cdn$0.07 for the three months ended June 30, 2025, reversing a loss from the prior year, but a loss of Cdn$0.02 for the six-month period, compared to a gain in 2024 (Loss) Earnings Per Share (Cdn$) | Metric | 3 Months Ended June 30, 2025 (Cdn$) | 3 Months Ended June 30, 2024 (Cdn$) | 6 Months Ended June 30, 2025 (Cdn$) | 6 Months Ended June 30, 2024 (Cdn$) | | :----------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Basic (loss) earnings per share | 0.07 | (0.04) | (0.02) | 0.03 | | Diluted (loss) earnings per share | 0.07 | (0.04) | (0.02) | 0.03 | | Weighted-average number of common shares (thousands) | 315,992 | 291,832 | 313,224 | 291,148 | - Weighted-average common shares outstanding increased by 8.3% for the three months and 7.6% for the six months ended June 30, 2025, compared to the prior year[84] 21. COMMITMENTS AND CONTINGENCIES The company has total commitments of Cdn$21.3 million for service and supply agreements as of June 30, 2025. Capital expenditure commitments for Florence Copper and Gibraltar decreased significantly. Surety bonds for reclamation obligations increased for Gibraltar Future Minimum Payments (Cdn$ in thousands) | Period | Amount (Cdn$ '000) | | :---------------- | :----- | | Remainder of 2025 | 8,141 | | 2026 | 11,491 | | 2027 | 1,671 | | Total commitments | 21,303 | - Capital expenditure commitments for Florence Copper decreased from Cdn$47.9 million at December 31, 2024, to Cdn$10.8 million at June 30, 2025[85] - Surety bonds for Gibraltar's reclamation obligations increased to Cdn$124.2 million as of June 30, 2025, from Cdn$108.5 million at December 31, 2024[86] 22. SUPPLEMENTARY CASH FLOW INFORMATION Changes in non-cash working capital items provided Cdn$35.7 million in cash for the six months ended June 30, 2025, a significant increase from the prior year. Non-cash investing and financing activities included Cdn$14.1 million in right-of-use assets Change in Non-Cash Working Capital Items (Cdn$ in thousands) | Item | 3 Months Ended June 30, 2025 (Cdn$ '000) | 3 Months Ended June 30, 2024 (Cdn$ '000) | 6 Months Ended June 30, 2025 (Cdn$ '000) | 6 Months Ended June 30, 2024 (Cdn$ '000) | | :----------------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Accounts receivable | 754 | 6,901 | (646) | 8,693 | | Inventories | (3,347) | (3,985) | 20,068 | 4,690 | | Accounts payable and accrued liabilities | 15,638 | 105 | 14,163 | (1,841) | | Total Change in non-cash working capital items | 10,125 | 776 | 35,658 | 10,495 | - Non-cash investing and financing activities for the six months ended June 30, 2025, included Cdn$14.1 million in right-of-use assets[90] 23. FAIR VALUE MEASUREMENTS The company classifies its financial assets and liabilities into a three-level fair value hierarchy. Senior secured notes are Level 1, while Cariboo contingent performance payables and Florence Copper Stream are Level 3 due to unobservable inputs - The fair value of senior secured notes, a Level 1 measurement, was Cdn$714.5 million as at June 30, 2025, compared to a face value of Cdn$682.2 million[93] Fair Value Hierarchy of Financial Instruments (Cdn$ in thousands) | Item | Level 1 (Cdn$ '000) | Level 2 (Cdn$ '000) | Level 3 (Cdn$ '000) | Total (Cdn$ '000) | | :--------------------------------------------------- | :------ | :------ | :-------- | :------ | | June 30, 2025 | | | | | | Derivative asset copper put and call options | - | 1,334 | - | 1,334 | | Cariboo contingent performance payable | - | - | (31,544) | (31,544) | | Florence Copper Stream and buy back option | - | - | (86,444) | (86,444) | | Marketable securities | 1,581 | - | - | 1,581 | | Investment in private companies | - | - | 500 | 500 | | December 31, 2024 | | | | | | Derivative asset copper put and call options | - | 26,568 | - | 26,568 | | Cariboo contingent performance payable | - | - | (36,363) | (36,363) | | Florence Copper Stream and buy back option | - | - | (67,813) | (67,813) | - Cariboo contingent performance payables and the Florence Copper Stream and buy back option are classified as Level 3 instruments due to the use of unobservable market data in their valuation[96] 24. SEGMENTED INFORMATION The company operates through three reportable segments: Gibraltar, Florence Copper, and Yellowhead, with corporate activities reconciled separately. Gibraltar is the primary revenue-generating segment, while Florence Copper is in development. For the six months ended June 30, 2025, Gibraltar reported earnings from mining operations, while Florence Copper reported a loss Earnings (Loss) from Mining Operations by Segment (Cdn$ in thousands) | Segment | 3 Months Ended June 30, 2025 (Cdn$ '000) | 3 Months Ended June 30, 2024 (Cdn$ '000) | 6 Months Ended June 30, 2025 (Cdn$ '000) | 6 Months Ended June 30, 2024 (Cdn$ '000) | | :---------------- | :--------------------------- | :--------------------------- | :--------------------------- | :--------------------------- | | Gibraltar | (397) | 44,948 | 16,071 | 69,367 | | Florence Copper | (105) | - | (207) | - | | Total | (502) | 44,948 | 15,864 | 69,367 | Total Assets by Segment (Cdn$ in thousands) | Segment | As at June 30, 2025 (Cdn$ '000) | As at December 31, 2024 (Cdn$ '000) | | :---------------- | :------------------ | :---------------------- | | Gibraltar | 1,189,226 | 1,182,605 | | Florence Copper | 856,021 | 828,422 | | Yellowhead | 28,144 | 26,024 | | Corporate | 189,368 | 157,992 | | Total Assets | 2,262,759 | 2,195,043 | - Gibraltar's earnings from mining operations decreased significantly from Cdn$69.4 million in the first six months of 2024 to Cdn$16.1 million in the same period of 2025[98][99]