Capstone Copper Corp.

Capstone reported Q2 2026 copper production of 51.8 thousand tonnes consolidated, or 51.1 thousand tonnes in the financial section, with consolidated C1 cash costs of $2.82 per pound. LME copper averaged $6.50 per pound, realized copper price was $6.22 per pound, gross margin was $3.40 per pound or 55.0%, adjusted EBITDA was $354 million, up 8.0% sequentially and 64.0% year-over-year, and adjusted net income attributable to shareholders was $97.6 million, or $0.13 per share. Net debt ended Q2 at $675 million, down $63 million from the prior quarter and over $100 million year to date, with more than $1 billion of liquidity including $367 million of cash and $715 million of undrawn RCF capacity. Management reaffirmed 2026 production, cost, and CapEx guidance; they also said second-half production should be stronger, mainly from higher sulfide grades and throughput at Mantoverde, while Mantoverde Optimized remains on schedule and on budget and Santo Domingo sanctioning is still expected in Q4.

The CEO framed 2026 as a year of operational stability and cash generation between major growth phases, saying Q2 delivered exactly that. He emphasized that the business is strengthening its balance sheet, generating internal cash flow, and progressing a pipeline of low-risk growth projects in jurisdictions where the company already operates. His tone was confident and constructive, especially around Mantoverde, Mantoverde Optimized, Mantos Blancos permitting, and the planned Q4 decision on Santo Domingo.

The CFO highlighted record quarterly financial performance: $354 million of adjusted EBITDA, $97.6 million of adjusted net income, $3.40 per pound gross margin, and a net debt reduction to $675 million. He noted that available liquidity was greater than $1 billion, including $367 million of cash and cash equivalents and $715 million of undrawn corporate RCF capacity, and that net debt-to-EBITDA improved to 0.5x. He also walked through margin protection measures, including hedging 40% of Chilean diesel exposure at 82¢ per liter versus about 93¢ spot and 50% of Pinto Valley diesel exposure at $0.93 per liter versus about $1.28 spot, plus a mine-plan shift at Mantoverde to avoid about 200 thousand tons of sulfuric acid purchases at spot in H2. He said the pyrite augmentation project should reduce Mantoverde sulfuric acid needs by 20.0% and cost about $45 million of CapEx, with spend to occur next year.

Analysts focused heavily on Mantoverde’s oxide-to-sulfide tradeoff, asking whether cathode/heap leach production would be curtailed through 2027 and whether more than 5 thousand tonnes could be shifted from oxides to sulfides. Management said the move is economic and flexible, not a hard shutdown, and that future cathode output will depend on acid prices, copper prices, and cut-off grade decisions; they also said the 5 thousand tonne shift is conservative and there could be upside if the ramp at Mantoverde runs faster than planned. Questions also centered on Santo Domingo financing and capex timing; management said port/tolling discussions are ongoing, 60% detailed engineering is being reached, and a capex update is expected in Q4 alongside the sanctioning decision. On Pinto Valley, management acknowledged the asset has been more challenging than expected but said the September shutdown should address key bottlenecks and that the mine remains core to the portfolio.