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Taseko Mines Ltd reported its Q2 2025 earnings, revealing a slight miss in revenue expectations, while adjusted earnings per share (EPS) also fell short of forecasts. The company posted an adjusted net loss of $0.04 per share compared to the expected loss of $0.0217 per share, representing an 84.33% surprise. Revenue came in at $116 million, below the anticipated $128.95 million, a 9.98% shortfall. Despite these results, the stock saw a modest after-hours increase of 0.71%, closing at $4.26, as investors reacted to operational updates and future guidance. According to InvestingPro data, the company maintains a "GOOD" overall financial health score of 2.81 out of 5, suggesting resilient fundamentals despite current challenges.
Key Takeaways
- Taseko Mines reported an adjusted net loss of $0.04 per share, missing EPS forecasts.
- Revenue was $116 million, falling short of expectations by nearly 10%.
- The Gibraltar SXEW plant restart and Florence Project progress are key operational highlights.
- The stock price increased slightly by 0.71% in after-hours trading.
- Future guidance suggests strong production rebound in the coming quarters.
Company Performance
Taseko Mines’ overall performance in Q2 2025 was mixed. While the company faced challenges in meeting revenue expectations, it reported a net income of $22 million, translating to $0.07 per share. The quarter saw significant operational advancements, such as the restart of the Gibraltar SXEW plant and near-completion of the Florence Project. These developments are crucial as the company positions itself as a competitive US-based copper supplier amid market volatility.
Financial Highlights
- Revenue: $116 million, a 9.98% miss from forecasts.
- Adjusted EPS: -$0.04, missing the forecasted -$0.0217.
- Net Income: $22 million ($0.07/share).
- Adjusted EBITDA: $17 million.
- Cash Balance: $122 million.
- Total Liquidity: Nearly $200 million.
Earnings vs. Forecast
Taseko Mines’ Q2 2025 earnings fell short of analyst expectations. The adjusted EPS of -$0.04 compared to a forecast of -$0.0217, resulting in an 84.33% surprise, highlighting a larger-than-expected loss. Revenue, at $116 million, was nearly 10% below projections, reflecting challenges in meeting sales targets despite operational improvements.
Market Reaction
Following the earnings announcement, Taseko Mines’ stock experienced a minor increase of 0.71% in after-hours trading, closing at $4.26. This movement is noteworthy given the revenue miss, suggesting investor confidence in the company’s operational progress and future prospects. InvestingPro data shows the stock has demonstrated strong momentum with a 15.56% return over the past six months. The stock remains within its 52-week range, with a high of $5.05 and a low of $2.38. Based on InvestingPro’s Fair Value analysis, the stock currently appears to be fairly valued.
Outlook & Guidance
Taseko Mines remains optimistic about its future, projecting a strong production rebound in the latter half of the year. The Florence Project is expected to begin producing 40-50 million pounds of copper in its first year, with initial solution injection planned for September. The company’s guidance includes significant production increases and strategic positioning in the US copper market.
Executive Commentary
CEO Stuart McDonald emphasized the strategic importance of the Florence Project, stating, "America’s next new copper mine is advancing smoothly and nearing completion." He also highlighted the project’s financial viability, noting, "At a copper price of $3.75 per pound, Florence has an after-tax NPV of $930 million." CFO Bryce Hamming added, "We are actively looking to extend our price protection into 2026," underscoring the company’s proactive approach to managing market volatility.
Risks and Challenges
- Copper market volatility due to geopolitical factors and tariff announcements.
- Potential delays in project completions affecting future production targets.
- Fluctuations in copper prices impacting revenue and profitability.
- Operational risks associated with new project ramp-ups.
- Economic conditions influencing demand for copper products.
Q&A
During the Q&A session, analysts focused on the company’s production expectations and operational efficiencies. Key discussions included improving grades at the Gibraltar mine and confirmation of production targets for the Florence Project. Additionally, questions about sulfuric acid pricing and capital spending were addressed, with executives indicating minimal further capital outlay expected in Q4.
Full transcript - Taseko Mines Ltd (TKO) Q2 2025:
Conference Operator: Ladies and gentlemen, thank you for standing by, and welcome to the Daseko Mines twenty twenty five Second Quarter Earnings Conference Call. At this time, all participants are in a listen only mode. We will conduct a question and answer session later and instructions will be given at that time. As a reminder, this call is being recorded. With that, I will turn the call over to Mr.
Brian Berco. Sir, you may begin.
Brian Berco, Investor Relations, Taseko Mines: Thank you, Janine. Welcome everyone and thank you for joining Taseko’s second quarter twenty twenty five conference call. The news release and regulatory filing announcing our financial and operational results was issued yesterday after market close and is available on our website at tasecomines.com and on SEDAR plus On the call today is Taseko’s President and CEO, Stuart McDonald Taseko’s Chief Financial Officer, Bryce Hamming and our COO, Richard Tremblay. As usual, before we get into opening remarks by management, I would like to remind our listeners that our comments and answers to your questions will contain forward looking information and this information by its nature is subject to risks and uncertainties. As such, actual results may differ materially from the views expressed today.
For further information on these risks and uncertainties, I encourage you to read the cautionary note that accompanies our second quarter MD and A and the related news release, as well as the risk factors particular to our company. These documents can be found on our website and also on SEDAR plus I would also like to point out that we will use various non GAAP measures during the call. You can find explanations and reconciliations regarding these measures in the related news release. And finally, all dollar amounts we will discuss today are in Canadian dollars unless otherwise specified. Following opening remarks, we will open the phone lines to analysts and investors for questions.
I will now turn the call over to Stuart for his remarks.
Stuart McDonald, President and CEO, Taseko Mines: Okay. Thank you, Brian, and welcome everyone to our second quarter results conference call. I’ll start with an update on our operations and projects and then pass it to Bryce for a closer look at our Q2 financials. It’s been a busy few months for us. And generally, I think we’re making good progress across our business with a few significant milestones achieved at our projects recently.
It’s also been an interesting time in the copper markets globally and the picture for U. S. Copper tariffs is now clearer. I’ll come back to that topic in a minute. But I want to start with a Gibraltar update.
So as noted in our last quarter’s earnings release, our mining rates at Gibraltar were impacted earlier this year by challenging conditions in the upper benches of the connector pit. In the second quarter, mining advanced into better ground and mine tonnages increased dramatically to a total of 30,000,000 tonnes for the quarter. That’s 31% higher than Q1, and in fact, best mining quarter in the last four years. As a result, we continue to expect a strong rebound in production in Q3 and then even better production in the fourth quarter continuing into 2026. In June and July, production was more than 35% higher than in April and May as we started to access this higher grade ore in the connector pit.
Second quarter copper production was 20,000,000 pounds, which was the same as the prior quarter and in line with plan. Copper grades were 0.2% and recoveries were 63%. We’re through the worst of the low quality ore and steadily transitioning into better grades with less oxidation, which will also result in higher recoveries. Moly grades and recoveries are also expected to improve significantly in the second half. Total cash costs or C1 reported at $3.14 per pound in the second quarter will also decline in the second half as production levels rise.
We reported copper cathode production at Gibraltar in the second quarter as well, as leaching operations commenced on one of the two leach pads and the Gibraltar SXEW plant was restarted in late May. After a quick ramp up, the plant operated at steady state for most of June and July, up until a couple of days ago when a transformer issue took the plant down. That issue has just been diagnosed yesterday afternoon and we expect six to eight weeks of downtime for that plant. It’s a short term issue with less than 1,000,000 pounds of production impact. On the plus side, we’ve continued to see positive ore reconciliations in the connector pit to more oxide ore than expected.
And we’re now thinking that SXEW plant could run for at least fifteen years and possibly longer. Turning over to Florence now, as we highlighted with our recent construction update, the project continues to advance smoothly, on schedule and with costs continuing to track in line with our previous guidance. Really happy with the work that’s being done by our capital projects team and the key contractors on-site. With the overall project completion over 90%, activities will soon be shifting to commissioning. Key systems such as the electrical substation, which was completed last month, are now starting to be released from the construction team and placed under the control of our growing operations team.
All of the well field drilling that was planned for the construction phase is now complete and electrical and pumping equipment is being installed into the wells. The next key milestone will be the initial injection of solutions which we’re targeting to achieve in September. And this would allow enough time to acidify the wellfield and produce first copper cathode before the end of the year. Through the first eighteen months, construction CapEx is tracking in line with updated guidance we issued last year. At the end of the quarter, US139 million has been incurred leaving only about 10% of the total capital outstanding.
The team is now working on the detailed operating plans for the ramp up next year, which will require additional wells to be drilled to get us to the up to the design capacity for the plant of 85,000,000 pounds per year. So all this to say, America’s next new copper mine is advancing smoothly and nearing completion. We’re not there yet, still a lot of work to be done and we’re entering a critical phase here over the next few months to get the startup. Obviously, the recent copper tariff news has driven a lot of volatility in the COMEX copper price, with metal traders and other financial speculators trading into the COMEX market and then rapidly exiting as the COMEX premium disappeared with the tariff announcement last week. Despite all the headlines, the LME copper price, which is the global benchmark, has remained stable and strong.
For The US copper market, the current administration is clearly incentivizing US based manufacturing of finished copper products. This is a very positive development for Florence, which soon become one of the few US based suppliers of refined copper. The US will remain a net importer of cathode in the coming years and our Arizona based operation will have a significant geographic advantage in delivering refined metal to the growing US manufacturing base. And just a reminder that at a copper price of $3.75 per pound, that’s the price used on our last technical report, Florence has an after tax NPV of $930,000,000 At today’s price of around US440 dollars per pound, the NPV is closer to 1,200,000,000.0 to 1,300,000,000.0. That’s not yet reflected in Taseko’s equity, but we’re working hard to unlock that value over the next year.
In the longer term, Taseko has other growth assets in our portfolio and we’ve had some significant developments on those projects in recent months, which I’ll touch on now. The new prosperity agreement announced in June was a very important milestone for the company. And I think it came as a surprise to the market, even though we’ve been making good progress towards an agreement over the previous year. The dialogue actually started about five years earlier. So it was certainly a lengthy process.
And I want to recognize the commitment and perseverance of both the province of BC and the Chilkoten national government to complete that deal in June. The agreement allows all three parties to turn the page on a historical conflict and move forward in a constructive way. It ends years of litigation while providing certainty as to how the significant copper gold deposit at New Prosperity could be developed in the future. Taseko has received a $75,000,000 cash payment from BC in exchange for a 22.5% equity interest in the project, which has been placed into a trust for the Silkotene Nation. The trust will only transfer this interest if the Silkotene consent to pursue mineral development on the property.
BC and the Silkotene will now enter into a land use planning process, and so the door remains open to future mine development, but only with the consent of the nation. Taseko retains 77.5% ownership of the new prosperity mineral rights and we can divest some or all of that interest at any time. I believe if for patient there will be a further opportunity down the road to realize significant value from this world class asset. For our Yellowhead project, we recently announced the results of an updated technical study with significantly improved economics, as well as the formal commencement of the environmental assessment process for the project. The new technical report includes updated CapEx, operating costs and long term metal price assumptions and describes a mine that would produce 178,000,000 pounds of copper annually.
Over a twenty five year mine life at a cash cost of around $1.0.9 per pound average. At $4.25 copper, the project has an NPV of 2,000,000,000 and an after tax IRR of 21%. That’s not bad for a project that we acquired for only $16,000,000 just a few years ago. When you consider the production profile, the mine life and the project economics, Yellowhead stacks up very well against all the other North American copper development projects. And we will continue to de risk the project as it moves through the permitting process.
In early July, the initial project description was accepted by the BC Environmental Assessment Office and the Impact Assessment Agency of Canada. Project is also advancing through the early stages of the Simp First Nations assessment process, and we continue to have an active and ongoing dialogue with them. We’ve also held a number of well attended open houses in local communities with more planned as part of the EA process. We have a few years of permitting and engineering work ahead of us at Yellowhead and we’ll continue to maintain a disciplined approach to project spending during that period. So we’ve got lots on the go and exciting times ahead for our North American copper business.
I’ll wrap it up there. Want to thank all of our shareholders for their ongoing support. And I’ll now pass the call over to Bryce for a financial update, and we can then open up the line for questions following that. Over to you, Bryce.
Bryce Hamming, Chief Financial Officer, Taseko Mines: Thank you, Stuart. I’ll provide some additional details on the financial aspects of the second quarter. Sales in the second quarter totaled £19,000,000 at an average realized price of $4.32 per pound, generating revenue of $116,000,000 for Taseko. Lower sales and a stronger Canadian dollar contributed to the lower quarter over quarter revenue. Net income for the quarter was $22,000,000 or $07 per share, and that’s mainly driven by unrealized foreign exchange gain on our U.
S. Dollar denominated debt with the strengthening Canadian dollar at quarter end. On an adjusted earnings basis, we posted a net loss of $13,000,000 or $04 loss per share. As Stuart mentioned, mining rates at Gibraltar in the second quarter were significantly higher than the first quarter. This increased total site cost to CAD 117,000,000.
Despite the increase in mining rates, strip ratio was lower as a result of a larger portion of the mine tonnes being oxide ore and that oxide ore was placed on the heap leach pads. Stuart mentioned the positive ore reconciliations we’ve been seeing. Capitalized strip for the quarter was slightly lower, it was $31,000,000 and it remained elevated as waste tonnes for the sulfide ore tonnes were above the average strip ratio for the connector pit. We expect that strip ratio to decline significantly in the second half of the year now that we’ve opened up access to the ore and connector. Costs on a per pound basis for the quarter were $3.14 per pound.
That’s based on copper produced. This was higher than the previous quarter and it was due to lower capitalized stripping and lower moly production. It is also impacted by costs associated with the oxide ore that are added to the heap leach pads, which is left inside operating costs for which production comes in future periods. So it skews that ratio by about $0.40 Adjusted EBITDA in the second quarter was $17,000,000 and was impacted by lower production sales volumes and higher costs associated with the mid grade stockpiles, which have a higher cost on a per pound basis. At Florence, we incurred $33,000,000 of construction costs in the second quarter as construction has now passed peak spend.
To date. $239,000,000 has been incurred on the construction of the commercial production facility, which is still tracking towards our revised estimate and guidance, which was at $232,000,000 plus up to 15%. So we’re heading towards around CAD $265,000,000 for total construction costs. Quarterly operating costs have been increasing as management continues to build out the operations team and prepare for commissioning ramp up later this year. We ended the quarter with cash consistent with the first quarter, the balance of $122,000,000 and that leaves us current liquidity of just under $200,000,000 after factoring in the CAD55 million that we’ve drawn on our revolving credit facility that’s with National Bank and ING.
Our quarter end cash balance also includes that CAD75 million payment from the BC government as part of the new prosperity agreement that we reached reached in June. And just a reminder of our copper price protection in light of some of the volatility that we’ve seen, we still have in place the minimum price of $4 per pound and that’s protecting 54,000,000 pounds production for the balance of 2025. So we are actively looking to extend our price protection into 2026 and we’ve been watching the copper market closely looking for opportunities to fix that at a reasonable price And that’s primarily to cover the ramp up of Florence that we have into the first half of next year. So with that, I’ll turn it over to the operator for any questions. Thank
Conference Operator: Our question comes from the line of Craig Hutchison from T. D. Cowen. Your line is open.
Craig Hutchison, Analyst, T.D. Cowen: Hi, good morning, guys. I was
Stuart McDonald, President and CEO, Taseko Mines: wondering if
Craig Hutchison, Analyst, T.D. Cowen: you could give us some commentary on what you’re seeing in terms of the grades here for Q3 Gibraltar and also the recoveries.
Stuart McDonald, President and CEO, Taseko Mines: Yeah, I guess generally speaking Craig, we’re expecting both grade and recovery to step up meaningfully in Q3. Back towards reserve grade averages or better and then probably better than reserve grade in Q4. So yeah, that’s probably as much guidance as we’d want to give on a quarterly basis. But definitely we’re seeing now getting deeper into the pit higher quality ore and higher grade ore. So that’s a positive for the second half.
And you should see that level, at least maybe not the Q4 level, but the second half averages kind of continue into the 2026 as well. So we shouldn’t see any more of the drop offs that we’ve had in the last couple of quarters.
Craig Hutchison, Analyst, T.D. Cowen: Is the higher oxide material you’re seeing in the connector pit, does that create a risk for recoveries here, especially in Q3, or do you feel like you’re through that and your recoveries are back up into the high 70s or low 80s?
Stuart McDonald, President and CEO, Taseko Mines: Yeah, we’re seeing it. You know the oxide oxidation, it’s not a binary thing, it’s not black or white. It’s definitely a transition. You know we’re pretty confident in our projections. Got a good database of good geological database and we’re seeing the higher grade, we’re seeing flashes of the higher grade, the better quality ore now and certainly expecting much more of that in the coming weeks and months.
Craig Hutchison, Analyst, T.D. Cowen: Okay, great. And then on Florence, you guys have mentioned on past calls, you’re targeting production somewhere in the range of forty to fifty million pounds next year if I recall correctly. Is that still the case or do I have that wrong?
Stuart McDonald, President and CEO, Taseko Mines: I think the technical report, year one of the technical report was around £40,000,000. So that’s the number that we have out there so far. I think as I mentioned in my remarks, we are working through a detailed operating plan now going well by well and doing projections of how the ramp up is going to go. So I expect as we get closer to start up in the fall, I’ll have more specific guidance we can talk about 2026. But yeah, what we’re seeing so this point is effectively what we have in the technical report.
Craig Hutchison, Analyst, T.D. Cowen: Okay, maybe one last question for me. What kind of pricing are you guys seeing right now on sulfuric acid?
Stuart McDonald, President and CEO, Taseko Mines: Richard, do you want to talk about acid?
Richard Tremblay, Chief Operating Officer, Taseko Mines: Yeah. Yeah. Not a problem. Yeah. We’re we’re seeing in the low 200 range for sulfuric acid right now.
We’ve been I think I mentioned before we’ve been in conversation with a number of different suppliers and actually have secured supply for this year from two different suppliers. So we’re seeing in that low 200 range.
Craig Hutchison, Analyst, T.D. Cowen: Okay. Alright. Great. Thanks. Thanks, guys.
Stuart McDonald, President and CEO, Taseko Mines: Thanks, Craig.
Conference Operator: Thank you. Our question comes from the line of Duncan Hay from Panmure Liberum. Sir, your line is open.
Craig Hutchison, Analyst, T.D. Cowen: Yes. Thanks. Hi, guys. A couple of questions from me. Just on the capital costs, what should we expect any more capitalized stripping in Q3, First of all, Gibraltar.
And then second of all, at Florence, is the remaining spend there, is that going to be weighted to Q3 and it will drop off in Q4? Or will there be a sort of reasonable will it be the same across those two quarters?
Stuart McDonald, President and CEO, Taseko Mines: Yes. Duncan, yes, no, it’s definitely the remaining spend of Florence definitely weighted to Q3. Q4 is more commissioning and shifting into operations. So yeah, you shouldn’t see much capital left or required after the end of Q3. There’s always a bit of a lag if you’re talking about cash flow, right?
Because we don’t pay our bills immediately. But in terms of CapEx incurred, mostly will be done at the end of Q3 at Florence. At Gibraltar, capital strip, that will really drop off in the second half. We’re really going to be mostly an ore operating below the average strip grade. I wouldn’t expect to see much or any capital strip in the second half.
Craig Hutchison, Analyst, T.D. Cowen: Yeah. Okay, thanks. And just quickly on the on I missed what you said about the SXEW plants at the beginning. You got some downtime there. How much are you thinking production for the rest of the year and into next year from that?
Stuart McDonald, President and CEO, Taseko Mines: Like I mean, we’re seeing it. This is potentially six to eight weeks of downtime, it’s just an issue that just arose, actually was just diagnosed really yesterday. So that’s less than a million pounds of production impact here, but obviously mostly will be in Q3. That operation, the guidance we’ve talked about that operation in the past producing three or 4,000,000 pounds a year. It is a seasonal operation, so it’ll operate until November, December and then shut down for the winter in Q1 next year.
The thing that’s happening at the SX at the operation is we actually have two leach pads and only one of them has been activated so far and the second pad will come online in 2026. So you’ll see a little step up in the production from that operation next year, maybe 4,000,000 or 5,000,000 pounds ish next year. That’s how we’re looking at it.
Craig Hutchison, Analyst, T.D. Cowen: Okay. All right. Thank you. Thanks, Keita. Cheers.
Stuart McDonald, President and CEO, Taseko Mines: Thanks, Duncan.
Conference Operator: Thank you. There are no further questions at this time. I will now turn the call over to the management for closing remarks.
Stuart McDonald, President and CEO, Taseko Mines: Okay. Thanks, everyone. Thanks, operator, and thank you all for dialing into our Q2 earnings call, and we’ll talk to you again next quarter. Thanks again. Bye.
Conference Operator: Thank you for joining the call today. You may now disconnect.
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