Pan American Silver Q2 Earnings Call Highlights

Pan American Silver reported $344 million in attributable free cash flow and returned a record $300 million to shareholders through buybacks and dividends. The company ended the quarter with $1.8 billion in cash and investments and approximately $3.2 billion in total available liquidity.

Second-quarter silver production reached 6.5 million attributable ounces, supporting the full-year guidance of 25 million to 27 million ounces. Gold production was below quarterly expectations, and the company now expects to finish at the low end of its 700,000-to-750,000-ounce annual guidance range.

Seismic activity at Jacobina and lower gold grades at El Peñón are weighing on gold output, while Pan American is pursuing mining and processing improvements at Jacobina. Development advanced at La Colorada and Timmins, but Escobal’s consultation process continues without a restart timeline.

Pan American Silver reported second-quarter 2026 attributable free cash flow of $344 million and returned a record $300 million to shareholders through share repurchases and dividends, while maintaining its full-year operating outlook for silver and gold production and costs. President and CEO Michael Steinmann said the company produced 6.5 million attributable ounces of silver during the quarter, at the high end of its quarterly guidance range, supported by performance at La Colorada and Juanicipio. The company reaffirmed its 2026 silver production guidance of 25 million to 27 million ounces.

Silver segment all-in sustaining costs were $17.80 per ounce in the second quarter. Steinmann attributed the cost level primarily to higher-cost ounces from an inventory drawdown at La Colorada, higher royalties associated with mining on an adjacent third-party concession, unfavorable currency movements and higher labor-related costs.

Attributable gold production totaled about 166,000 ounces in the second quarter, below the company’s quarterly outlook. Pan American expects the quarter to be its weakest for gold output in 2026 and said production should be more heavily weighted toward the fourth quarter. While the company reaffirmed its full-year gold guidance range of 700,000 to 750,000 ounces, it now expects to finish at the low end of that range. It also reduced its third-quarter gold outlook to approximately 3,000 to 6,000 ounces below the lower end of its previously issued quarterly range of 178,500 to 192,000 ounces. The revised near-term outlook reflects lower-than-expected production at Jacobina and El Peñón. At Jacobina, Pan American now expects annual gold production to be about 10,000 ounces below the low end of its original guidance range of 181,000 to 191,000 ounces.Steinmann said the company has responded to seismic activity at Jacobina by leaving larger pillars, reducing mining rates in some higher-grade areas and increasing development to open additional mining zones. He said the seismic events had not caused injuries or infrastructure damage, and characterized the production impact as a postponement rather than a loss of reserves. The company is also evaluating alternative mining approaches, including Avoca-type methods with waste-rock and cemented backfill, as part of an optimization program at Jacobina. Process plant upgrades, including new carbon-in-pulp ta...