Great Panther Mining Ltd

Revenue for Q2 2022 was $30 million, versus $39 million in Q2 2021. Gold sales were 16,076 ounces versus 21,459 ounces a year ago, and gold production was 16,629 ounces versus 20,609 ounces in Q2 2021, though up from 14,037 ounces in Q1 2022. Average realized gold price was $1,865 per ounce versus $1,850 per ounce last year. Mine operating income was $0.1 million versus a loss of $2.6 million, net loss was $12.1 million versus $8.7 million, and EBITDA was negative $5 million versus negative $0.9 million. Cash costs were $1,575 per ounce sold versus $1,617 in Q2 2021, and AISC excluding corporate G&A was $3,080 per ounce sold. The company ended the quarter with $21.1 million in cash and cash equivalents and $43.4 million in borrowings. For 2022, Tucano cash cost guidance was raised to $1,400 to $1,500 per ounce sold from $1,200 to $1,300, and AISC excluding corporate G&A to $2,200 to $2,300 from $1,600 to $1,700. Tucano production guidance remained 85,000 to 100,000 ounces; management said it expects a progressive ramp through Q3 and a steady-state Q4, with improved cash flow in the second half and into 2023, but also said additional financing will be required for working capital, capital investment, exploration, and scheduled debt repayments.

Alan Hair framed the quarter as transformative because Great Panther agreed to sell its Mexican silver mines, leaving Tucano as the main focus. He said the company sees the most long-term value creation at Tucano and is seeing progress there, with production ramping through the second half and a return to regular production expected by Q4. His tone was cautiously constructive, but he repeatedly emphasized inflation, uncertain conditions, and the need to manage liquidity carefully.

Sandra Daycock walked through the quarter’s weaker profitability and liquidity profile, citing $30 million of revenue, $12.1 million net loss, negative $5 million EBITDA, and negative $8.3 million of operating cash flow before working capital. She highlighted spending of $15 million on stripping, $7.1 million on capital investments, $1.8 million on exploration, $5.5 million of net debt repayment, $3 million of ATM equity proceeds, and $13 million of Nyrstar settlement cash. She also explained the guidance increase to $1,400 to $1,500 cash cost and $2,200 to $2,300 AISC, noting the gap reflects stripping and Tucano facility investments, and said further financing will be needed to support working capital, capex, exploration, and debt obligations.

Analysts focused on when Tucano would reach normalized production, what cost levels might look like after the ramp, and whether inflation or supply-chain issues were hurting operations. Management said Q3 should show a progressive ramp and Q4 should be steady state, and said they were not seeing key consumable delivery problems at Tucano, only some contractor mobilization delays. They also said the Urucum North underground project is still moving through engineering and permitting, but construction is unlikely to start this year. On Coricancha, management said all options remain on the table, including a restart or a sale, and reiterated that capital allocation priorities are centered on Tucano.