Metals Exploration reports record revenue, cash generation

(Sharecast News) - Metals Exploration reported record annual revenue and cash generation for 2025 on Friday, despite lower gold production at Runruno, as higher gold prices supported earnings and helped fund development of the La India project in Nicaragua.

The AIM-traded gold producer, which has assets in the Philippines and Nicaragua, said revenue rose 9.1% to $208.4m for the year ended 31 December, from $191.1m a year earlier.

Operating profit increased 15.1% to $61.6m, while adjusted EBITDA rose 27.6% to $125.9m.

Free cash generated from operations increased 19.2% to $115.3m.

The group ended the year debt-free, compared with net debt of $6.8m at the end of 2024.

Gold production at the Runruno mine in the Philippines fell 22.2% to 65,287 ounces, from 83,897 ounces, while average gold recoveries declined to 88.4% from 90.5%.

Metals Exploration said output was at the lower end of revised guidance after production was affected by cyanide contamination in the BIOX circuit during the third quarter and Super-typhoon Uwan in the fourth quarter.

The average realised gold price rose to $3,154 per ounce from $2,312, although it was held back by 15,800 ounces of historical hedges filled at an average price of $2,223 per ounce.

All-in sustaining costs rose to $1,368 per ounce from $1,135, above guidance because of the lower number of ounces sold.

The company said mining at Runruno was expected to be completed in the second half of 2026, with processing operations set to conclude by the end of the year.

Guidance for 2026 was set at 40,000 to 48,000 ounces at an AISC of $1,700 to $2,000 per ounce.

Metals Exploration said it expected Runruno to generate free cash flow in 2026 broadly similar to 2025, despite lower production and recoveries, allowing it to continue funding development of La India.

The group acquired Condor Gold in January 2025, giving it control of the La India gold project and a wider Nicaraguan concession package.

Metals Exploration said La India was 33% complete at year end, slightly ahead of schedule and within budget, with construction now about 50% complete after the period ended.

The company said it was targeting first gold from commissioning in December 2026 and commercial production in the first quarter of 2027.

It has already completed bulk earthworks for the processing plant, finished the run-of-mine pad and started stockpiling first ore.

It has also secured a 25-year renewal of the main mining concession, effective from January 2027.

Metals Exploration said the La India development had so far been funded entirely from Runruno cash flow, although it had secured an undrawn $30m gold pre-pay facility to avoid any development delays or working capital constraints.

Exploration at La India has also progressed, with more than 16,000 metres drilled to date.

The company said work had focused on step-out drilling from planned mining areas and exploration drilling at Cacao, where drilling had identified a high-grade ore shoot. It expects to issue an updated gold resource statement in the second half of 2026.

In the Philippines, the company said it did not plan further short-term exploration at Dupax after concluding that an economic resource could not be defined quickly enough to support conversion of the Runruno plant.

At Abra, it was targeting the start of an initial drill programme later in 2026, subject to local consultation processes.

Chairman Steven Smith said 2025 had been a year of "significant strategic progress", with strong cash flow from Runruno and fast-tracked development at La India.

"The group entered 2026 debt free, with significant cash in the bank from operations at Runruno, and a clear path to production at La India, set for December 2026," he said.

Chief executive Darren Bowden said the acquisition of Condor marked Metals Exploration's first step towards becoming a multi-project company, adding that the group would continue to pursue further exploration, development and acquisition opportunities where appropriate.

At 1329 BST, shares in Metals Exploration were down 4.5% at 13.66p.

Reporting by Josh White for Sharecast.com.

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