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New Gold Inc (AMEX:NYSE:NGD) reported record quarterly free cash flow and substantial year-over-year financial improvements during its Q2 2025 earnings presentation on July 28. The mining company highlighted significant operational milestones at both its New Afton and Rainy River mines while projecting strong future cash generation.
Quarterly Performance Highlights
New Gold achieved record quarterly free cash flow of $63 million in Q2 2025, with its Rainy River mine contributing a record $45 million. The company reported gold production of 78,595 ounces and copper production of 13.5 million pounds, keeping it on track to meet its 2025 guidance.
"We’re seeing quarter-over-quarter production and cost improvement," noted the company in its presentation, pointing to several operational milestones including the completion of New Afton’s C-Zone undercut level in May and Rainy River’s pit portal breakthrough in April.
As shown in the following operating results table, the company maintained competitive all-in sustaining costs of $1,393 per gold ounce sold:
Detailed Financial Analysis
The company’s financial performance showed remarkable improvement compared to the previous year. Revenue reached $308.4 million in Q2 2025, representing a 41.3% increase from $218.2 million in Q2 2024. Net earnings grew to $68.3 million, while adjusted net earnings surged to $89.8 million—a dramatic 428.2% increase from $17.0 million in the same quarter last year.
Cash generated from operations nearly doubled year-over-year to $162.9 million, supporting the company’s capital expenditures while still delivering the record free cash flow.
The following financial highlights table illustrates the company’s strong quarterly performance:
New Gold’s balance sheet reflects a solid liquidity position of $452 million, evenly split between $226 million in cash and cash equivalents and $226 million in undrawn credit facility. The company also reported that following the quarter’s end, it redeemed the remaining July 2027 Senior Notes, enhancing its financial flexibility.
The company’s debt structure and liquidity position are detailed below:
Operational Developments
New Afton’s 2025 outlook remains positive, with the B3 zone continuing to over-deliver and the C-Zone development now 65% complete. The first half of 2025 showed gold production of 34,800 ounces and copper production of 27.1 million pounds, putting the mine on pace to meet its annual guidance of 60,000-70,000 gold ounces and 50-60 million pounds of copper.
Similarly, Rainy River reported record June production and quarterly free cash flow. The mine produced 95,500 gold ounces in the first half of 2025, positioning it well to achieve its annual guidance of 265,000-295,000 ounces.
Both mines are also advancing significant exploration programs. New Afton has completed 18,000 meters of its planned 48,000-meter drilling program, with seven diamond drill rigs currently active. Rainy River has completed 28,000 meters of its planned 58,000-meter program, with three diamond drill rigs focused on expanding mineral resources at the NW Trend and testing growth opportunities.
Strategic Initiatives & Outlook
New Gold’s presentation highlighted an exceptionally strong three-year outlook, projecting cumulative free cash flow of approximately $2.2 billion from 2025 through 2027. This translates to average annual free cash flow of around $720 million, or approximately $0.90 per share, representing an average annual free cash flow yield of about 20%.
The company presented three price scenarios for its projections, as shown in the following chart:
For 2025, New Gold outlined several strategic goals, including delivering on production and cost guidance, maintaining strong health and safety performance, and increasing exploration to target mineral reserve replacement. At New Afton, the focus remains on ramping up the C-Zone and advancing development of the East Extension, while Rainy River will concentrate on ramping up its underground main zone and advancing Phase 5 open pit development.
Despite the positive presentation, New Gold’s stock showed a slight decline in premarket trading on July 28, down 1.59% to $4.34. This follows a closing price of $4.41 on July 25, with the stock trading within its 52-week range of $1.94 to $5.16.
The company’s strong Q2 performance builds on its Q1 2025 results, which saw revenue of $289 million exceeding analyst expectations. With its improved cash position and operational milestones, New Gold appears well-positioned to continue its positive trajectory through the remainder of 2025 and beyond.
Full presentation:
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