Hochschild Mining Plc said in an update on Wednesday that 2025 production was in line with its revised guidance, underpinned by a strong operational performance at its Inmaculada and San Jose mines and continued progress at the Mara Rosa operation, as the group pointed to a sharp improvement in cash generation amid higher precious metals prices.
For the year, attributable production totalled 221,444 ounces of gold, down from 245,013 ounces in 2024, and 7.5 million ounces of silver versus 8.5 million ounces previously.
Attributable gold equivalent production was 311,509 ounces, compared with 347,374 ounces a year earlier, while attributable silver equivalent output was 25.9 million ounces versus 28.8 million ounces.
In the fourth quarter, attributable production was 79,605 gold equivalent ounces, or 6.6 million silver equivalent ounces, up 13% on the third quarter, which Hochschild attributed to "solid quarterly contributions from Inmaculada and San Jose and the continued ramp-up at Mara Rosa, driven by improved mining configuration and performance, and higher plant availability through enhanced maintenance reliability."
At Inmaculada, fourth-quarter production was 37,857 ounces of gold and 1.33 million ounces of silver, equating to 53,833 attributable gold equivalent ounces, with the company saying performance improved versus the prior quarter due to stronger gold grades and recoveries after temporary sequencing-driven grade reductions.
Full-year production at Inmaculada was 142,233 ounces of gold and 5.6 million ounces of silver, or 209,921 attributable gold equivalent ounces.
At San Jose, where Hochschild holds a 51% interest, the mine produced 1.0 million ounces of silver and 24,485 ounces of gold in the fourth quarter, or 36,639 gold equivalent ounces, a 17% increase on the third quarter, as the company cited a stronger gold grade profile and steady plant performance.
Full-year production at San Jose was 76,970 ounces of gold and 3.6 million ounces of silver, equating to 120,639 attributable gold equivalent ounces, with higher tonnage from expanded plant capacity offset by scheduled grade reductions.
Mara Rosa continued its ramp-up, delivering 7,067 ounces of gold in the fourth quarter plus minor silver by-product, which Hochschild said amounted to 7,086 gold equivalent ounces, a marked improvement on the third quarter following actions taken under a previously announced turnaround plan that included a temporary plant stoppage; full-year output at Mara Rosa was 40,062 gold equivalent ounces.
Hochschild said all-in sustaining costs for 2025 were expected to be at the higher end of, or marginally above, its revised range of $1,980 to $2,080 per gold equivalent ounce.
It also highlighted the impact of the higher price environment on costs, noting that while rising prices had boosted cash generation they were also feeding through to "workers profit sharing, royalties, commercial discounts and selling expenses in Argentina."
Average realisable prices in the fourth quarter were $3,959 an ounce for gold and $65.3 an ounce for silver, compared with $2,464 and $30.7 respectively a year earlier.
For 2025 overall, average realisable prices were $3,222 an ounce for gold and $44.2 an ounce for silver, up from $2,345 and $28.7 in 2024.
The FTSE 250 miner reported a sharply strengthened balance sheet, with total cash of about $317m as at 31 December, up from $97m a year earlier, and net debt reduced to about $23m from $216m.
It said the improvement reflected a strong operational quarter at Inmaculada and San Jose, higher metal prices and completion of the Tiernan Gold transaction.
Hochschild noted that Tiernan Gold began trading on the TSX Venture Exchange in December, generating $12m in proceeds for the company, which retained a 69.8% shareholding valued at $158m as at 19 January.
It also disclosed that its 19.5% stake in Aclara Resources was valued at $110m as at 19 January.
"Production in 2025 was in line with our revised guidance, driven by a strong operational performance at Inmaculada and San Jose. Mara Rosa delivered significant progress in the period and is performing as expected," said chief executive Eduardo Landin.
"We continue to make encouraging progress in our brownfield exploration programme and, in keeping with our strategy of unlocking value from non-core assets, in the fourth quarter we also completed the listing of Tiernan Gold which bolstered financing for the Volcan gold project.
"The current unprecedented commodity price rises are providing a strong financial tailwind for the business, and whilst there has also been an immediate impact on royalties, profit sharing, and selling expenses, we continue to focus on cost discipline in order to underpin higher margins.
"We are confident of delivering further operational and strategic progress this year, and our 2026 guidance reflects rising output from Mara Rosa alongside solid contributions from Inmaculada and San Jose, while our preparatory work at Monte do Carmo remains on track and a final investment decision will be made later this year."
Looking ahead, Hochschild guided for 2026 attributable production of 300,000 to 328,000 gold equivalent ounces, comprising 174,000 to 185,000 ounces from Inmaculada, 67,000 to 80,000 ounces from Mara Rosa and 59,000 to 64,000 ounces from its 51% share of San Jose, assuming a gold-to-silver ratio of 77x.
The company forecast 2026 all-in sustaining costs of $2,157 to $2,320 per gold equivalent ounce, and set total sustaining and development capital expenditure at around $210m to $225m, alongside a $45m brownfield exploration budget.
The group also flagged continued work across its brownfield exploration programme and projects, including progress toward a final investment decision at Monte do Carmo in 2026, and said permitting at the Royropata silver project remained on track with substantial resource additions expected to be disclosed with full-year results.
At 0849 GMT, shares in Hochschild Mining were up 1.49% at 612p.
Reporting by Josh White for Sharecast.com.