Contango Silver & Gold — Q2 2026 Earnings Summary

Financial Performance

• Reported a total loss from operations of $8.5 million for Q2 2026, compared to an income of $23.0 million in Q2 2025.
• Reported net income of $4.8 million ($0.14 per fully diluted share) for Q2 2026, compared to net income of $15.9 million ($1.24 per fully diluted share) in Q2 2025.
• Reported an adjusted net loss of $5.5 million for Q2 2026, compared to adjusted net income of $28.8 million in Q2 2025.
• Net income for Q2 2026 included a gain of $10.3 million on derivative contracts, whereas Q2 2025 included a loss of $12.8 million.
• Cash and cash equivalents increased to $89.0 million as of June 30, 2026, from $64.8 million as of December 31, 2025.
• Net cash used in operating activities was $50.3 million year-to-date 2026, compared to net cash provided of $36.9 million year-to-date 2025.
• Cash provided by financing activities was $54.8 million year-to-date 2026, primarily from an equity offering, compared to cash outflows of $20.5 million in year-to-date 2025.
• Contango's share of production sold from the Manh Choh mine totaled 8,627 ounces of gold and 10,319 ounces of silver in Q2 2026.
• Received a $9.0 million cash distribution from the Peak Gold JV during Q2 2026.
• Cash costs on a by-product basis were $2,641 per ounce sold in Q2 2026, and AISC on a by-product basis was $2,877 per ounce sold.
• Remaining debt balance was $12.6 million prior to the July 1 credit facility amendment; the aggregate principal outstanding under the secured credit facility increased to $46.3 million following the amendment.

Guidance and Future Outlook

• On track to meet 2026 production guidance of 40,000 to 45,000 gold ounces.
• Anticipated production for the third 2026 campaign is 11,000 to 12,000 gold equivalent ounces net to Contango.
• Guided to 75,000 to 80,000 ounces of gold production in 2027.
• Projected 2027 cash costs of $1,200 to $1,300 per ounce and AISC of $1,300 to $1,400 per ounce sold.
• Long-term goal is to grow production from a current average of 60,000 gold equivalent ounces to over 200,000 ounces of gold and 5 million ounces of silver annually.
• Lucky Shot Feasibility Study is targeted for H1 2027, with a production decision focused on a Direct Shipping Ore model targeting 40,000 to 50,000 gold ounces per year.
• Kitsault Valley Initial Assessment preliminary development plan is targeted for release in 2027.
• Underground exploration tunnel construction at Johnson Tract is scheduled to begin in 2027.

Business Segments and Product Lines

• Manh Choh: Completed mining in the North Pit; transitioning to the higher-grade South Pit with expectations of increased processed ore tonnage and grades. Operational enhancements are being implemented at the Fort Knox mill.
• Lucky Shot: Underground and surface drilling are on track. Underground infill drilling supports a Feasibility Study. Surface drilling completed approximately 3,500 meters of a 6,000-meter campaign. Acquired 100% ownership by purchasing the underlying lease and 2% NSR royalty for $16.074 million and settling $18.75 million in milestone payments.
• Kitsault Valley: Completed over 20,000 meters of a 40,000-meter drill campaign by end of Q2. An updated Mineral Resource Estimate is expected in Q3 2026.
• Johnson Tract: Earthworks on the 2.6-mile access road are progressing; permitting is on schedule under the FAST-41 program.
• Mergers: Team integration following the merger with Dolly Varden Silver is complete.
• Hedges: The hedge book is now fully liquidated, providing 100% unhedged upside to gold prices.

Market and Competitive Landscape

• The company operates in the mining industry with a focus on district-scale silver and gold exploration in British Columbia's Golden Triangle and high-grade gold production in Alaska.
• The company holds a 30% interest in the Peak Gold JV (operated by Kinross Gold Corporation) at the Manh Choh project.
• The company holds 100% ownership of the Lucky Shot project and a lease on the Johnson Tract project.
• The company's flagship Canadian asset comprises approximately 247,000 acres in and around the Kitsault Valley.

Risks and Challenges

• Risks include operational risks in exploring and developing mineral reserves, geology uncertainties, and the speculative nature of the mining industry.
• Volatility of natural resources prices, including gold and silver, is a key risk.
• Risks related to the Company's indebtedness under the Amended Credit Facility, including the ability to service or repay debt and interest rate changes.
• The Company faces unhedged exposure to gold prices following the liquidation of its hedge book.
• Potential delays in obtaining mining permits, government policy changes, and political developments.
• Dependence on the operator of the Peak Gold JV for achieving anticipated production and grades at Manh Choh.
• Risks related to weather, natural disasters, and health/safety/environmental issues.

Management Commentary and Tone

• CEO Rick Van Nieuwenhuyse described Q2 2026 as a "transformative period of operational execution and financial restructuring."
• Management highlighted that the initial $105 million capital investment in Manh Choh has been fully repaid, with total returns reaching $160 million, making future cash flows "pure upside and clear profit."
• Management expressed confidence in the "dramatic step-up" in 2027 production and the ability to execute the plan to grow production significantly.
• Management noted that the merger with Dolly Varden Silver is "yielding immediate results."
• The tone indicates a focus on simplifying the capital structure, de-risking growth assets, and leveraging balance sheet strength.

Analyst Questions and Answers

• No specific analyst questions and answers were included in the press release text.

Other Key Points

• On July 1, 2026, the Company amended its credit facility, converting 15,000 ounces of 2027 gold hedges into debt and increasing the secured credit facility principal to $46.3 million.
• The amendment included the purchase of 15,000 put option contracts with a strike price of $3,100 per ounce maturing in March and June 2027.
• On May 4, 2026, the Company entered an agreement to purchase the Lucky Shot lease and 2% NSR royalty for $16.074 million, closing on July 1, 2026.
• On June 26, 2026, the Company settled $18.75 million in milestone payments for the Lucky Shot project via a $5.0 million cash payment and the issuance of 100,000 common shares.
• The Lucky Shot project has yielded high-grade intercepts, including 0.17 meters grading 972.10 g/t Au.
• The Company has extinguished long-term liabilities by buying out the Lucky Shot lease and royalty to secure 100% ownership.
• Remaining carry trade contracts total 11,000 ounces maturing in September and December 2026.