ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
Introduction
This section of this Annual Report on Form 10-K generally discusses fiscal 2025 and 2024 items including our results of operations and financial condition, and year-to-year comparisons between 2025 and 2024 with a particular emphasis on 2025. In each case, we discuss factors that we believe have affected our operating results and financial condition and may do so in the future. For a discussion of our financial condition and results of operations for 2024 compared to 2023, please refer to Item 7.Management’s Discussion and Analysis of Financial Condition and Results of Operations in our Annual Report on Form 10-K for the year ended December 31, 2024, filed with the SEC on March 14, 2025.
Regarding properties and projects that are not in production, we provide some details of our plan of operation. This section provides information up to the date of filing this report.
This discussion contains financial performance measures that are not prepared in accordance with United States Generally Accepted Accounting Principles (“US GAAP” or “GAAP”). Each of the following is a non-GAAP measure:cash costs, cash cost per ounce, all-in sustaining costs (“AISC”), all-in sustaining cost per ounce, adjusted earnings before interest, depreciation and amortization (“Adjusted EBITDA”), adjusted EBITDA per share and average realized price per ounce. These non-GAAP measures are used by management in running the business and we believe they provide useful information that can be used by investors to evaluate our performance and our ability to generate cash flows. These measures do not have standardized definitions and should not be relied upon in isolation or as a substitute for measures prepared in accordance with GAAP. For a reconciliation of these non-GAAP measures to the amounts included in our Consolidated Statements of Operations for the years ended December 31, 2025, and 2024 and to our Balance Sheets as of December 31, 2025, and 2024, and certain limitations inherent in such measures, please see the discussion under “Non-GAAP Financial Performance Measures”, beginning on page 77.
This discussion also includes references to advanced-stage properties, which are defined as properties for which advanced studies and reports have been completed indicating the presence of mineralized material or proven or probable reserves, or that have obtained or are in the process of obtaining the required permitting. Our designation of certain properties as “advanced-stage properties” should not suggest that we have or will have proven or probable reserves at those properties as defined by S-K 1300. This section provides information up to the date of the filing of this report.
The information in this section should be read in conjunction with our consolidated financial statements and the notes thereto included in this Annual Report on Form 10-K.
Throughout this Management’s Discussion and Analysis (“MDA”), the reporting periods for the three months ended on December 31, 2025, and December 31, 2024, are abbreviated as Q4/25 and Q4/24 and the reporting for the years ended December 31, 2025, and 2024 are abbreviated as the full year 2025 and the full year 2024 respectively. All quarterly financial and other interim results are unaudited.
In addition, in this report, gold equivalent ounces (“GEO”) includes gold and silver ounces calculated based on a silver to gold ratio of 90:1 for Q1/25, 99:1 for Q2/25, 88:1 for Q3/25, and 76:1 for Q4/25. Beginning in Q2/19, we adopted a variable silver to gold ratio for reporting that approximates the average price during each fiscal quarter.
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Index to Management’s Discussion and Analysis:
I
Page
2025 and Q4/25 Operating and Financial Highlights 62
Selected Consolidated Financial and Operating Results 65
Consolidated Operations Review 66
Liquidity and Capital Resources 67
Environmental, Social, and Governance 68
Operations Review 69
United States Segment 69
Gold Bar Mine Complex 69
Exploration Activities 70
2026 Production and Cost Outlook 70
Canada Segment 71
Fox Complex 71
Exploration Activities 72
2026 Production and Cost Outlook 72
Mexico Segment 73
Advanced-Stage Properties - El Gallo 73
Minera Santa Cruz Segment, Argentina 74
San José Mine 74
2026 Production and Cost Outlook 75
McEwen Copper Inc. 76
Los Azules Project 76
Commitments and Contingencies 77
Non-GAAP Financial Performance Measures 77
Critical Accounting Estimates and Accounting Developments 81
Forward-Looking Statements 84
Risk Factors Impacting Forward-Looking Statements 85
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2025 AND Q4/25 OPERATING AND FINANCIAL HIGHLIGHTS
Highlights for the year and quarter ended December 31, 2025, are summarized below and discussed further under “Consolidated Performance”:
Corporate Developments
Subsequent Events
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Operational Highlights
Financial Highlights
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Exploration and Mineral Resources and Reserves
(1) At our 49% attributable interest.
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SELECTED CONSOLIDATED FINANCIAL AND OPERATING RESULTS
The following tables present selected financial and operating results of the company for the three months ended December 31, 2024, and 2025 and for the years ended December 31, 2023, 2024, and 2025.
Three months ended December 31, Year ended December 31,
(in thousands, except per share)
Net income (loss) per share $ 0.70 $ (0.16) $ 0.64 $ (0.86) $ 1.16
Three months ended December 31, Year ended December 31,
(in thousands, except per share)
Cash costs per ounce ($/GEO sold) (2)
AISC per ounce ($/GEO sold) (2)
(3) On sales from 100% owned operations only, excluding streaming arrangement.
(in thousands, unless otherwise indicated)
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CONSOLIDATED OPERATIONS REVIEW
Revenue from gold and silver sales: For full year 2025, revenue from our 100%-owned operations increased to $197.6 million, up from $174.5 million for full year 2024, reflecting an increase of 13%. For Q4/25, revenue from our 100%- owned operations was $64.4 million compared to $33.5 million for Q4/2024. These improvements were primarily driven by higher realized gold prices, which increased to $3,532 per GEO in 2025 compared to $2,390 per GEO in 2024, and $4,436 per GEO in Q4/25, compared to $2,648 in Q4/24.
Production costs applicable to sales: For full year 2025, production costs applicable to sales increased to $122.8 million as compared to $113.3 million for full year 2024. For Q4/25 production costs were $40.2 million compared to $26.5 million for Q4/24. These increases were primarily driven by higher operational stripping costs for deposits mined at the Gold Bar Mine Complex in H2/25. At the Fox Complex, our cost base increased, driven by higher contractor labor and operational development costs to advance Froome West.
Advanced project costs: Advanced project costs of $8.0 million for full year 2025 increased by $0.8 million compared to full year 2024. This increase was primarily attributable to the commencement of our Grey Fox project.
Exploration costs: Exploration costs of $22.2 million for full year 2025 increased by $5.7 million compared to full year 2024 of $16.5 million primarily due to expanded exploration targets. For Q4/25, exploration costs were $6.3 million compared to $5.3 million for Q4/24. Exploration costs of $12.0 million for full year were incurred at the Gold Bar Mine Complex on infill drill programs for operational areas, exploration drilling at the Windfall and Lookout Mountain projects, and the completion of drillholes between and below the open pits at Unity Ridge. At the Fox Complex, exploration costs of $10.2 million for full year 2025 were spent primarily on diamond drilling at the Gibson area of the Grey Fox project.
General and administrative costs: General and administrative costs of $26.7 million for full year 2025 increased by $9.5 million compared to full year 2024 of $17.2 million. For Q4/25, general and administrative costs were $12.2 million compared to $6.5 million for Q4/24. Increases to general and administrative costs in 2025 primarily relate to professional fees and other costs associated with developing our growth plans across our operations.
Loss from investment in McEwen Copper: For full year 2025, we recorded a loss of $25.5 million from our investments in McEwen Copper, compared to a loss of $47.0 million recorded in full year 2024. For Q4/25 a loss of $5.7 million was recorded as compared to $10.3 million for Q4/24. These losses represent our proportion of McEwen Copper’s net loss, which is driven primarily by exploration expenditure. Details of McEwen Copper’s operating results are presented in the “Operations Review” section of this MDA and Note 9 to the Consolidated Financial Statements. Effective September 3, 2025, Los Azules advanced into the development stage following the confirmation of economically viable mineral reserves. During this stage, eligible expenditures are capitalized and depreciated over the life of mine after commercial production is achieved.
Income from investment in MSC: For full year 2025, we recorded an income of $41.1 million from our investments in MSC, compared with $9.0 million income recorded in full year 2024. For Q4/25 we recorded an income of $33.6 million as compared to a loss of $4.3 million in Q4/24. This improvement was a result of year-over-year increases in realized gold and silver prices, considerably improving gross profits. Details of MSC’s operating results are presented in the “Operations Review” section of this MDA and Note 9 to the Consolidated Financial Statements.
Interest and other finance expense, net: Interest and other finance expense totalled $7.2 million for full year 2025, a $2.6 million increase compared to an income of $4.6 million for full year 2024. For Q4/25, interest and other finance expense totalled $2.6 million compared to $1.0 million in Q4/24. These changes reflect the increase in monthly interest payments on the Company’s higher outstanding debt. Details of the Company’s outstanding debt are disclosed in Note 11 to the Consolidated Financial Statements.
Other income: Other income of $10.7 million for full year 2025 improved from $2.7 million for full year 2024. For Q4/25, other expense was $6.2 million compared to a income of $2.4 million in Q4/24. The changes in other income were primarily driven by the unrealized gains on our marketable securities.
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Dilution gain on McEwen Copper: In Q4/2025, the Company recognized an accounting gain of $0.8 million (Q4/24 - $5.8 million) resulting from the dilution of its ownership in McEwen Copper, which is included in other income on the Statement of Operations. This is discussed further in Note 9 to the Consolidated Financial Statements.
Income and mining tax recovery:For the year ended December 31, 2025, the Company recorded an income tax recovery of $27.5 million, compared to an income tax recovery of $3.0 million for the full year 2024. For Q4 2025, an income tax recovery of $24.0 million was recognized, as compared to an income tax expense of $1.1 million in Q4 2024. The higher income tax recovery for both the full year 2025 and Q4 2025 is primarily attributable to the release of a portion of the U.S. valuation allowance. After evaluating all available positive and negative evidence in accordance with ASC 740, the Company concluded that it is more likely than not that a portion of its deferred tax assets will be realized. Positive evidence supporting this conclusion included sustained improvements in operating performance, continued profitability, and forecasted taxable income supported by the Company’s long-term financial projections. Additional information is provided in Note 19 to the Consolidated Financial Statements.
LIQUIDITY AND CAPITAL RESOURCES
Our cash, cash equivalents and restricted cash balance increased by $37.8 million during 2025, from $17.5 million as at December 31, 2024 to $55.3 million as at December 31, 2025.
Cash provided by operating activities of $6.9 million during 2025 reflects the net income of $34.4 million for the period, adjusted for non-cash impacts, including net income from equity method investments of $15.6 million, depreciation, amortization, and depletion of $27.8 million, flow-through premium amortization of $5.6 million, income and mining tax recovery of $22.3 million, stock-based compensation of $3.7 million, and a $6.7 million change in non-cash working capital. Further details are provided in the Consolidated Statements of Cash Flows.
Cash used in investing activities of $48.0 million during 2025 consisted of additions to mineral property interests and plant and equipment of $44.6 million, driven primarily by capital development at the Fox Complex and capitalized pre-stripping at the Gold Bar Mine Complex, the investment in marketable securities of $2.2 million, and advances to related parties of $5.1 million, partially offset by the proceeds from sale of marketable securities of $1.6 million and dividends received from MSC of $2.2 million.
Cash provided by financing activities of $78.7 million during 2025 consisted of $110.0 million in proceeds from the issuance of Senior Convertible Notes, $4.1 million in proceeds from an exercise of stock options and warrants, and $4.9 million proceeds from issuance of flow-through common shares offset by principal repayments on our term loan facility of $20.0 million, a $4.1 million purchase of capped call options, $15.1 million financing costs related to convertible notes and the $1.1 million repayment of finance lease obligations.
Working capital as at December 31, 2025 was $44.1 million, a $50.6 million increase from negative $6.5 million as at December 31, 2024. The increase in working capital was driven by an increase in cash and cash equivalents of $37.3 million, a $2.9 million increase in receivables from McEwen Copper, a $19.5 million increase in marketable securities, a $8.7 million increase in inventories, a $4.5 million decrease in flow-through share premium, and a $1.5 million decrease in tax liabilities, offset by a $16.5 million increase in accounts payables and accrued liabilities, a $4.0 million increase in contract liability, and a $1.5 million increase in reclamation and remediation liabilities.
The Company believes that it has sufficient liquidity along with funds generated from ongoing operations to fund anticipated cash requirements for operations, capital expenditures and working capital purposes for the next 12 months.
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ENVIRONMENTAL, SOCIAL, AND GOVERNANCE
McEwen Inc. is committed to upholding the highest corporate governance and sustainability standards, adhering to Environmental, Social and Governance (“ESG”) guidelines, as defined by the Global Reporting Initiative (“GRI”) and other organizations. Our mission is to operate safely and respectfully towards our stakeholders, as we strive for continuous improvement throughout the responsible and sustainable development of our mining projects. Our ESG highlights during 2025 include:
Health and Safety
At our 100% owned Fox Complex, Gold Bar Mine Complex and El Gallo mine operations:
McEwen Inc. strives to maintain a safe, healthy working environment for all. Our operations aim to meet and exceed occupational health and safety standards. We conduct regular training and safety audits and foster a culture of safety throughout our organization.
Environment
At our 100% owned Fox Complex, Gold Bar Mine Complex and El Gallo mine operations:
McEwen Inc. conducts its operations with the utmost regard for the environment, focusing on conservation and sustainable development practices. We are committed to the safe handling of tailings, and we adhere to the Global Industry Standard on Tailings Management, as issued by the International Council on Mining and Metals, as well as the UN Environment Programme and Principles for Responsible Investment.
Community Engagement
McEwen Inc. is engaged and proactive in its efforts to improve the quality of life for the communities around us, our employees, and all our stakeholders. Our initiatives range from local development projects to educational and health programs. We engage closely with local communities to ensure our activities yield sustainable and positive outcomes.
McEwen Copper
At McEwen Copper, we embed ESG principles into our business model, prioritizing sustainable development and responsible mining. In 2025, we continued our citizen participation initiative in Calingasta, engaging 963 community members about the Los Azules Project’s environmental and social impacts. Our Local Labor Program connected Calingasta workers with Los Azules contractors during the 2025-2026 season. The Local Supplier Development Program achieved a 13% year-over-year increase in our supplier database, integrating 213 local businesses into our supply chain.
Additionally, the community training program supported 713 individuals with skills development, and educational initiatives continued to prepare students for careers in mining. We also achieved a major milestone with the approval of the EIA, demonstrating our commitment to environmental stewardship and community engagement.
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OPERATIONS REVIEW
United States Segment
The United States segment is comprised of the Gold Bar Mine Complex, consisting of the operating Gold Bar mine, and the Tonkin, Windfall and Lookout Mountain exploration projects; as well as other exploration properties in the State of Nevada.
Gold Bar Mine Complex
The following table sets out operating results for the Gold Bar Mine Complex for the three months ended December 31, 2025, and 2024, and year ended December 31, 2025, compared to 2024 and 2023:
Three months ended December 31, Year ended December 31,
Operating Results (in thousands, unless otherwise indicated)
Gold ounces:
Silver ounces:
GEOs:
2025 compared to 2024
For the full year 2025, the Gold Bar Mine Complex produced 33,227 GEOs, a 25% decrease from 44,581 GEOs in 2024. While the decrease in ounces produced primarily reflects the transition of mining activities from the higher-grade Gold Bar South deposit in 2024 to the lower grade Pick III deposit in 2025, production was also negatively impacted by differences identified between the geological model and mining zones. The Company has reinterpreted historic drill holes supported by the recognition of geological faults in a drilling campaign conducted during Q3/25. As a result, Q4/25 production improved to 8,943 GEOs, a 29% increase from 6,927 GEOs in Q4/24.
Revenue from gold and silver sales for full year 2025 was $116.7 million, up from $105.1 million in 2024, driven by a 48% higher average realized gold price which was partially offset by a 24% decrease in GEOs sold. In Q4/25, revenue increased to $29.4 million from $16.9 million in Q4/24, primarily due to a 29% increase in GEOs sold, and a 48% higher average realized gold price.
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Production cost applicable to sales for full year 2025 totaled $68.1 million, which increased from $63.5 million in 2024. In Q4/25, production costs applicable to sales increased to $21.7 million from $14.0 million in Q4/24. The increase was primarily driven by increased mining contractor costs to perform stripping activities required at Pick III, which had been capitalized during the comparative period in 2024, partially offset by the effect of fewer GEOs sold in 2025 compared to the prior year period.
Cash cost and AISC per GEO sold were $2,014 and $2,401 for full year 2025, respectively, compared to $1,425 and $1,677 for full year 2024. The increase in cash costs, and a corresponding increase in AISC, was primarily attributable to the increased mining contractor costs to perform stripping activities at Pick III. In Q4/25, cash costs and AISC per GEO sold were $2,415 and $2,460, respectively, compared to $2,136 and $2,773 in Q4/24. The increase in cash costs and AISC per GEO was primarily driven by lower GEOs sold, as noted above.
Exploration Activities
During Q4/25, exploration activities were focused on Windfall and Lookout Mountain. At Windfall, the resource definition program continued until the end of the year. At Lookout Mountain, core was drilled for metallurgical sampling and at Seven Troughs, a drone magnetometer geophysical survey was completed over the entire property. The results will be used to help generate targets for 2026 exploration.
During 2026, exploration work at the Eureka Project will consist of definition and infill drilling at Windfall and Lookout Mountain. Additional metallurgical core holes will also be drilled. Outside of these areas, exploration work is planned in areas with favorable geochemistry, geology, geophysics and drilling results.
2026 Production and Cost Outlook
During 2026, we expect to continue production from Pick III. Mining at Gold Bar South will begin in May, and run through the remainder of 2026. For full year 2026, we expect to produce between 39,000 to 43,000 GEOs at a cash cost per GEO sold between $2,250 and 2,450 and an AISC per GEO sold between $2,350 and $2,550 per ounce.
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Canada Segment
The Canada segment is comprised of the Fox Complex, which currently includes our Froome underground gold mine (including the Froome West deposit); the Stock Mine (consisting of the West, East and Main zones); the Stock mill; the Grey Fox exploration project; and a number of exploration and other properties located near the city of Timmins, Ontario.
Fox Complex
The following table sets out operating results for the Fox Complex mines for the three months ended December 31, 2025, and 2024, and the years ended December 31, 2025, 2024, and 2023:
Three months ended December 31, Year ended December 31,
Operating Results (in thousands, unless otherwise indicated)
Mined mineralized material (kt) 80 68 303 309 391
Processed mineralized material (kt) 86 88 307 404 457
Gold ounces:
Silver ounces:
GEOs:
Stock Project
Development activities at the Stock project advanced in line with the Company’s 2025 mine development plan. In Q4/25, we invested $10.9 million to advance development at the Stock project (full year 2025 – $29.5 million). During the period, the project received an updated Closure Plan Permit from the Ministry of Mines and completed major upgrades to ventilation and air heating systems, enhancing underground readiness. Site construction progressed across critical infrastructure, including access roads, building foundations, and essential service areas, as well as surface facilities, including the mine dry, office complex, and maintenance buildings. Rehabilitation of historical infrastructure continued, with steady progress on shaft access and safety improvements. Ramp development advanced at an average rate of 20 feet (6.2 meters) per day during 2025, supporting key project milestones. Overall, project execution during 2025 remained consistent with schedule and budget expectations, reinforcing the Company’s target for commencement of production in 2027.
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2025 compared to 2024
The Fox Complex produced 5,853 and 23,187 GEOs in Q4/25 and full year 2025, respectively, compared to 6,514 and 30,151 GEOs produced in Q4/24 and full year 2024, respectively. The decrease in GEO production was primarily due to a 32% reduction in processed mineralized material, as mining continues in the lower-grade zones at the bottom of the Froome deposit. The discovery of higher-grade mineralization at the new Froome West deposit extends production into 2026, supporting the transition into the production phase at the Stock project.
Revenue from gold and silver sales was $76.0 million for full year 2025, compared to $67.8 million for full year 2024,representing a 12% increase primarily driven by a 48% increase in the average realized gold price. For Q4/25, revenue from gold and silver sales totaled $20.8 million, up from $16.3 million for Q4/24. The increase was driven by a 68% higher average realized gold price, partially offset by an 11% decrease in GEOs sold. Realized gold prices at the Fox Complex are impacted by historic streaming arrangements, which require the sale of a portion of gold produced from the Froome and Black Fox mines at $611 per ounce for 2025.
Production costs applicable to sales were $13.5 million in Q4/25, compared to $12.4 million in Q4/24, representing a 28% increase primarily driven by higher mining expenses due to additional third-party contractors hired to address labor shortages and operational development costs to advance Froome West. The same factors contributed to the variance between full year 2025 and full year 2024 production costs.
Cash cost and AISC per GEO sold were $2,238 and $2,506 for full year 2025, respectively, compared to $1,642 and $1,980 for full year 2024. In Q4/25, cash cost and AISC per GEO sold were $2,278 and $2,361, respectively, compared to $1,874 and $2,240 in Q4/24. The increase in unit costs was primarily driven by a 22% decrease in GEOs sold for full year 2025. The same factors impacted unit costs on a full year basis, with higher fixed costs spread over fewer ounces sold.
Exploration Activities
During Q4/25, $2.1 million was incurred, primarily for exploration in the Fox Complex. At the Grey Fox property, exploration activities included 28,051 feet (8,550 meters) of diamond drilling, primarily focused on the Gibson Zone, where favorable grades and widths were identified. Other priority drill targets included the Stroud property, which is contiguous with Grey Fox, to verify a historical resource.
2026 Production and Cost Outlook
For full year 2026, we expect to produce between 16,000 to 19,000 GEOs at a cash cost per GEO sold between $2,200 and $2,400 per ounce and an AISC per GEO sold between $2,350 and $2,550 per ounce.
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Mexico Segment
The Mexico segment consists of El Gallo, located in Sinaloa state.
El Gallo HLM
We have reached a construction decision for the Phase 1 heap leach material reprocessing project contemplated in our Feasibility Study (previously described as the Fenix project). In December 2025, the Company was granted the extension of its Environmental Impact Assessment (Manifestación de Impacto Ambiental) from the Mexican government. The Company is currently proceeding with the final detailed engineering plan for the mill, which has been purchased and is onsite. We anticipate beginning construction mid-2026, with production commencing mid-2027.
Phase 1 is expected to produce for 10 years, producing approximately 20,000 GEOs annually once commercial production is achieved. Production will come from the reprocessing of the material currently on the leach pad, through a ball mill with an operating plan optimized for cash flow and recovery. Remaining capital costs to complete construction are estimated at $25 million. Since the material that will be processed has been previously leached, there will be no significant development or exploration costs anticipated.
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MSC Segment, Argentina
The MSC segment is comprised of a 49% interest in the San José mine, located in Santa Cruz, Argentina.
MSC – Operating Results
The following table sets out operating results for the San José mine for the three months ended December 31, 2025, and 2024, and for the years ended December 31, 2025, 2024 and 2023 (on a 100% basis):
Three months ended December 31, Year ended December 31,
Operating Results (in thousands, unless otherwise indicated)
San José Mine—100% basis
Average grade mined (g/t)
Average grade processed (g/t)
Average recovery (%):
Gold ounces:
Silver ounces:
GEOs:
Average realized price:
The comparative analysis below compares the operating and financial results of MSC on a 100% basis.
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2025 compared to 2024
On a 100% basis, the San José mine produced 118,612 GEOs for full year 2025, compared to 122,653 GEOs for full year 2024. In Q4/2025 production was 37,739 GEOs, compared to 38,389 GEOs in Q4/24. The decrease in full year 2025 was primarily due to lower milled grades, with gold and silver head grades declining by 6% and 9%, respectively, with a related 4% and 5% decrease in recovery rates for gold and silver respectively. These impacts were partially offset by a 21% increase in tonnes processed during the period, driven by the installation of a new vertical mill completed in December 2024, which increased average daily mill throughput by 24% from approximately 1,700 tonnes per day in late 2024 to 2,100 tonnes per day in 2025. The same factors apply for the change in Q4/25.
Revenue from gold and silver sales was $459.5 million for full year 2025, compared to $310.4 million for full year 2024. This increase was primarily driven by 63% and 53% higher realized gold and silver prices, respectively, partially offset by a 9% decrease in GEOs sold. For Q4/25, revenue from gold and silver sales was $201.0 million, compared to $99.8 million in Q4/24, driven by the same factors that impacted revenue for the full year.
Production costs applicable to sales were $78.2 million and $248.5 million in Q4/25 and full year 2025, respectively, compared to $60.9 million and $215.1 million in Q4/24 and full year 2024, respectively. Cost increases during the year were largely attributable to high inflation in the Argentine market, which outpaced the government-controlled depreciation of the peso against the U.S. dollar. This resulted in higher real costs for expenses denominated in local currency. Despite management’s successful efforts to negotiate with key vendors and worker unions to align pricing with currency adjustments, the inflationary environment drove an overall rise in costs.
Cash cost and AISC per GEO sold were $2,206 and $2,638, respectively, compared to $1,742 and $2,139 for full year 2024. In Q4/25, cash cost and AISC per GEO sold were $1,940 and $2,202, respectively, compared to $1,635 and $2,038 in Q4/24. The increase in both cash costs and AISC on a year-over-year basis was primarily due to 16% higher production costs and 9% lower GEOs sold during 2025, as noted above.
Investment in MSC
Our 49% attributable share of operations from our investment in MSC in 2025 resulted in an income of $41.1 million, compared to an income of $9.0 million in 2024. Despite higher than planned unit costs arising from negative macroeconomic factors, the metal price environment has allowed the operation to strengthen its liquidity, improving its working capital balance to $182.8 million as at December 31, 2025, compared to $87.0 million as of December 31, 2024.
Operational performance continued to strengthen during the year, with plant throughput stabilizing at approximately 2,100 tonnes per day, reflecting the increased capacity enabled by the Vertical Tower Mill commissioned in late 2024. Underground productivity also improved following the transition to a three-shift schedule, supporting extraction rates near the 2,000-tonne-per-day level required to consistently supply the plant.
MSC Dividend Distribution (49%)
Wereceived $2.2 million in dividends from MSC for full year 2025 (2024 - $0.4 million).
2026 Production and Cost Outlook
For full year 2026, we expect to produce between 59,000 to 64,000 GEOs at a cash cost per GEO sold between $2,000 and $2,200 per ounce and an AISC per GEO sold between $2,300 and $2,500 per ounce.
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McEwen Copper Inc.
Asof December 31, 2025, we own a 46.3% interest in McEwen Copper, which owns a 100% interest in the Los Azules copper project in San Juan, Argentina, and the Elder Creek exploration project in Nevada, USA. Including amounts spent by Minera Andes Inc. prior to 2012, and directly by McEwen Inc. prior to 2021, we have invested over $430 million in exploration expenditures to develop Los Azules as a world-class copper deposit.
Los Azules, San Juan, Argentina
The Los Azules project is one of the world’s largest undeveloped copper deposits and is located in the Province of San Juan, Argentina. In Q4/25, McEwen Copper achieved a key milestone by completing the Feasibility Study and associated reserve estimate for the project. The study highlights the project’s potential as an environmentally conscious, high-purity, low-cost copper operation. Using a copper price of $4.35 per pound, the Feasibility Study indicates an after-tax net present value of $2.9 billion at a discount rate of 8%, and an internal rate of return of 19.8%.
The Feasibility Study established mineral reserves and resources, with proven and probable reserves totaling 10.2 billion pounds of copper based on a copper price of $4.25 per pound. Mineral resources, comprising 5.4 billion pounds of measured and indicated copper and 20.0 billion pounds of inferred copper, were estimated using a copper price of $4.80 per pound.
Since 2021, McEwen Copper has been advancing Los Azules through significant additional drilling, numerous studies, social consultation, and permitting. Equipped with the results from the Feasibility Study and key government approvals, McEwen Copper will continue developing the Los Azules project in subsequent periods.
Los Azules Exploration
Field exploration activities at Los Azules identified four additional deposits near the Los Azules deposit which could extend the mine life beyond existing project plans. The four targets consist of Tango, Porfido Norte, Franca, and Mercedes, which are porphyry deposits that have potential for hypogene mineralization.
Preliminary drilling of newly identified targets is expected to commence later in 2026. In parallel, refinement of geological mapping and surface sampling across all target areas is ongoing and will continue into the next field season. This work is expected to significantly improve drill targeting accuracy.
Regime of Incentive for Investments (“RIGI”)
On September 26, 2025, McEwen Copper received RIGI approval following an extensive technical application process. RIGI approval entitles the Los Azules project to a series of tax and regulatory benefits, including a reduction in the corporate income tax rate from 35% to 25%, exemption from sales tax during the construction phase, elimination of export duties, and exemption from the obligation to repatriate export revenues. Additionally, the project benefits from a 30-year fiscal stability guarantee and access to international arbitration for dispute resolution. The Government of Argentina established the RIGI program to support and incentivize foreign investment across various industries, including mining.
Energy Supply Contract
McEwen Copper has reached an agreement with YPF Luz to power its Los Azules copper project in San Juan, Argentina, with renewable energy. The companies signed a Memorandum of Understanding to negotiate the energy supply, which will come from YPF Luz’s renewable assets connected to the Argentine Interconnection System. YPF Luz will also develop, construct, and finance a high-voltage transmission line to connect the project to the grid, ensuring a sustainable energy supply for the copper project.
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COMMITMENTS AND CONTINGENCIES
As of December 31, 2025, we have the following consolidated contractual obligations:
Payments due by period
(1) Amounts presented represent the undiscounted uninflated future payments.
With respect to reclamation cost commitments disclosed above, we have surety bonds outstanding to provide bonding for our obligations in the United States and Canada. These surety bonds are available for draw down in the event we do not perform our reclamation obligations. If the bond is drawn, we would be obligated to reimburse the surety. When the specific reclamation requirements are met, the beneficiary of the surety bonds will cancel and/or return the instrument to the issuing entity. As of December 31, 2025, no additional liability has been recognized for our surety bonds of $48.2 million.
Lease obligations disclosed above include long-term leases covering office space, exploration expenditures, option payments and option payments on properties.
NON-GAAP FINANCIAL PERFORMANCE MEASURES
We have included in this report certain non-GAAP performance measures as detailed below. In the gold mining industry, these are common performance measures but do not have any standardized meaning and are considered non-GAAP measures. We use these measures to evaluate our business on an ongoing basis and believe that, in addition to conventional measures prepared in accordance with GAAP, certain investors use such non-GAAP measures to evaluate our performance and ability to generate cash flow. We also report these measures to provide investors and analysts with useful information about our underlying costs of operations and clarity over our ability to finance operations. Accordingly, they are intended to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with GAAP. There are limitations associated with the use of such non-GAAP measures. We compensate for these limitations by relying primarily on our US GAAP results and using the non-GAAP measures supplementally.
The non-GAAP measures are presented for our wholly owned mines and our interest in the San José mine. The GAAP information used for the reconciliation to the non-GAAP measures for our minority interest in the San José mine may be found in Item 8. Financial Statements and Supplementary Data, Note 9, Equity Investments. The amounts in the reconciliation tables labeled “49% basis” were derived by applying to each financial statement line item the ownership percentage interest used to arrive at our share of net income or loss during the period when applying the equity method of accounting. We do not control the interest in our operations of MSC and the presentations of assets and liabilities and revenues and expenses of MSC do not represent our legal claim to such items. The amount of cash we receive is based upon specific provisions of the Option and Joint Venture Agreement (“OJVA”) and varies depending on factors including the profitability of the operations.
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The presentation of these measures, including the minority interest in the San José, has limitations as an analytical tool. Some of these limitations include:
Cash Costs and All-In Sustaining Costs
Cash costs consist of mining, processing, on-site general and administrative expenses, community and permitting costs related to current operations, royalty costs, refining and treatment charges (for both doré and concentrate products), sales costs, export taxes and operational stripping costs, but exclude depreciation and amortization (non-cash items). The sum of these costs is divided by the corresponding gold equivalent ounces sold to determine a per ounce amount.
All-in sustaining costs consist of cash costs (as described above), plus accretion of retirement obligations and amortization of the asset retirement costs related to operating sites, environmental rehabilitation costs for mines with no reserves, sustaining exploration and development costs, sustaining capital expenditures and sustaining lease payments. Our all-in sustaining costs exclude the allocation of corporate general and administrative costs. The following is additional information regarding our all-in sustaining costs:
The sum of all-in sustaining costs is divided by the corresponding gold equivalent ounces sold to determine a per ounce amount.
Costs excluded from cash costs and all-in sustaining costs, in addition to depreciation and depletion, are income and mining tax expenses, all corporate financing charges, costs related to business combinations, asset acquisitions and asset disposals, impairment charges and any items that are deducted for the purpose of normalizing items.
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The following tables reconcile these non-GAAP measures to the most directly comparable GAAP measure, production costs applicable to sales:
Three months ended December 31, 2025 Year ended December 31, 2025
Gold Bar Fox Complex Total Gold Bar Fox Complex Total
(in thousands, except per ounce) (in thousands, except per ounce)
In‐mine exploration 94 — 94 563 — 563
Three months ended December 31, 2024 Year ended December 31, 2024
Gold Bar Fox Complex Total Gold Bar Fox Complex Total
(in thousands, except per ounce) (in thousands, except per ounce)
In‐mine exploration 149 — 149 796 — 796
Sustaining leases and other 14 68 82 84 273 357
Three months ended December 31, 2023 Year ended December 31, 2023
Gold Bar Fox Complex Total Gold Bar Fox Complex Total
(in thousands, except per ounce) (in thousands, except per ounce)
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Three months ended December 31, Year ended December 31,
San José mine cash costs (100% basis) (in thousands, except per ounce)
Adjusted EBITDA and adjusted EBITDA per share
Adjusted earnings before interest, taxes, depreciation, and amortization (“Adjusted EBITDA”) is a non-GAAP financial measure and does not have any standardized meaning. We use adjusted EBITDA to evaluate our operating performance and ability to generate cash flow from our wholly owned operations in production; we disclose this metric as we believe this measure provides valuable assistance to investors and analysts in evaluating our ability to finance our precious metal operations and capital activities separately from our copper exploration operations. The most directly comparable measure prepared in accordance with GAAP is net loss before income and mining taxes. Adjusted EBITDA is calculated by adding back McEwen Copper's income or loss impacts on our consolidated income or loss before income and mining taxes.
The following tables present a reconciliation of adjusted EBITDA:
Three months ended December 31, Year ended December 31,
(in thousands) (in thousands)
Added back:
Advanced Projects - McEwen Copper Inc. — — — — 76,345
Average realized prices
The term average realized price per ounce used in this report is also a non-GAAP financial measure. We prepare this measure to evaluate our performance against market (London P.M. Fix). The average realized price for our 100% owned properties is calculated as gross sales of gold and silver, less streaming revenue, divided by the number of net ounces sold in the period, less ounces sold under the streaming agreement.
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The following table reconciles the average realized prices to the most directly comparable U.S. GAAP measure, revenue from gold and silver sales. Ounces of gold and silver sold for the San José mine are provided to us by MSC.
Three months ended December 31, Year ended December 31,
Average realized price - 100% owned (in thousands, except per ounce)
Three months ended December 31, Year ended December 31,
CRITICAL ACCOUNTING ESTIMATES AND ACCOUNTING DEVELOPMENTS
Management’s Discussion and Analysis of Financial Condition and Results of Operations discuss our consolidated financial statements, which have been prepared in conformity with US GAAP. The preparation of these statements requires that we make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses. We base these estimates on historical experience and on assumptions that we consider reasonable under the circumstances; however, reported results could differ from those based on the current estimates under different assumptions or conditions. The summary of our significant accounting policies is detailed in Note 2 of the Consolidated Financial Statements.
We believe that significant areas requiring the use of management estimates and assumptions relate to environmental reclamation and closure obligations; asset useful lives utilized for depletion, depreciation, amortization and accretion calculations; the fair value of equity investments and asset groups used in impairment testing; recoverable gold in leach pad inventory; current and long-term inventory and mine development capitalization costs; the collectability of sales taxes receivable; fair values of assets and liabilities acquired in business combinations; reserves; valuation allowances for deferred tax assets; income and mining tax provisions and reserves for contingencies and litigation. There are other items within our financial statements that require estimation but are not deemed to be critical. However, changes in the estimates used in these and other items could have a material impact on our financial statements. In the section below we identify estimates critical to the understanding of our financial condition and results of operations and that require the application of significant management judgment.
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Asset Retirement Obligation, Reclamation and Remediation Costs: The Company records the fair value of a liability for an asset retirement obligation (“ARO”) in the period that it is incurred if a reasonable estimate of fair value can be made. The Company prepares estimates of the timing and amounts of expected cash flows when an ARO is incurred, which are updated to reflect changes in facts and circumstances. Estimation of the fair value of AROs requires significant judgment, including amount of cash flows, timing of reclamation, inflation rate and credit risk. Accrued reclamation and closure costs can represent a significant and variable liability on our balance sheet. The Company has estimated its liabilities under appropriate accounting guidance and reviews its liabilities on at least an annual basis. However, the ranges of liability could exceed the liabilities recognized. If substantial damages were awarded, claims were settled, or remediation costs were incurred in excess of our accruals, our financial results or condition could be materially adversely affected.
Mineral Property Interests, Plant and Equipment and Mine Development Costs: The Company amortizes its mineral property interests, plant and equipment, and mine development costs using the most appropriate method, which includes the units-of-production method over the estimated life of the mine or ore body based on recoverable ounces to be mined from proven and probable reserves, or the straight-line method over the useful life. The accounting estimates related to amortization are critical accounting estimates because (1) the determination of reserves involves uncertainties with respect to the ultimate geology of its reserves and the assumptions used in determining the economic feasibility of mining those reserves and (2) changes in estimated proven and probable reserves and asset useful lives can have a material impact on net (loss) income.
Estimates regarding mine development capitalization costs involve the determination of proven and probable reserves.
Impairment of Long-lived Assets: The Company reviews and evaluates its long-lived assets for impairment when events or changes in circumstances indicate that the related carrying amounts may not be recoverable. Once it is determined that impairment exists, an impairment loss is measured as the amount by which the asset carrying value exceeds its fair value.
For asset groups where an impairment loss is determined using the discounted future net cash flows method, future cash flows are estimated based on quantities of recoverable mineralized material, expected gold and silver prices (considering current and historical prices, trends and related factors), production levels, operating costs, capital requirements and reclamation costs, all based on life-of-mine plans. The term “recoverable mineralized material” refers to the estimated amount of gold or other commodities that will be obtained after considering losses during processing and treatment. The Company’s estimates of future cash flows are based on numerous assumptions and uncertainties. It is possible that actual future cash flows will be significantly different than the estimates, as actual future quantities of recoverable minerals, gold, silver and other commodity prices, production levels and costs of capital are each subject to significant risks and uncertainties.
Stockpiles, Material on Leach Pads, In-process Inventory, Precious Metals Inventory and Materials and Supplies: Stockpiles are measured by estimating the number of tonnes added and removed from the stockpile, an estimate of the contained metals (based on assay data) and the estimated metallurgical recovery rates. Costs are allocated to stockpiles based on current mining costs incurred including applicable overhead relating to mining operations.
Costs are attributed to the mineralized material on leach pads based on current mining costs incurred up to the point of placing the ore on the pad. Costs are removed from the leach pad inventory based on the average cost per estimated recoverable ounce of gold on the leach pad as the gold is recovered. The estimates of recoverable gold on the leach pads are calculated from the quantities of mineralized material placed on the leach pads (measured tonnes added to the leach pads), the grade of mineralized material placed on the leach pads (based on assay data) and a recovery percentage.
Although the quantities of recoverable gold placed on the leach pads are reconciled by comparing the grades of ore placed on the pads to the quantities of gold recovered (metallurgical balancing), the nature of the leaching process inherently limits the ability to precisely monitor inventory levels. As a result, the metallurgical balancing process is constantly monitored, and the engineering estimates are refined based on actual results over time.
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In-process material is measured based on assays of the material from the various stages of processing. Costs are allocated to in-process inventories based on the costs of the material fed into the process attributable to the source material coming from the mines, stockpiles and/or leach pads plus the in-process conversion costs incurred to that point in the process.
Costs are allocated to precious metal inventories based on the costs of the respective in-process inventories incurred prior to the refining process plus applicable refining costs.
The assumptions used by the Company to measure metal content during each stage of the inventory conversion process include estimated recovery rates based on laboratory testing and assaying. The Company periodically reviews its estimates compared to actual experience and revises its estimates when appropriate. The ultimate recovery will not be known until the leaching operations cease.
Proven and Probable Reserves: Critical estimates are inherent in the process of determining the Company’s reserves. The Company’s reserves are affected largely by our assessment of future metals prices, as well as by engineering and geological estimates of ore grade, accessibility and production cost. The Company’s assessment of reserves occurs at least annually, and periodically utilizes external audits.
Reserve estimates are used in determining appropriate rates of unit-of-production depreciation, with net book value of many assets depreciated over remaining estimated reserves. Reserves are also a key component in forecasts, with which the Company compares future cash flows to current asset values to ensure that carrying values are reported appropriately. The Company’s forecasts are also used in determining the level of valuation allowances on the Company’s deferred tax assets. Reserves also play a key role in the valuation of certain assets in the determination of the purchase price allocations for acquisitions. Reserves involve many estimates and there are no guarantees that the Company will recover the indicated quantities of metals. Changes in the estimates could result in material adjustments to the Company’s reserves and asset values.
Income and Mining Taxes: The Company accounts for income and mining taxes under ASC 740 using the liability method, recognizing certain temporary differences between the financial reporting basis of liabilities and assets and the related tax basis for such liabilities and assets. This method generates either a net deferred income and mining tax liability or asset for the Company, as measured by the statutory tax rates in effect. The Company derives the deferred income and mining tax charge or benefit by recording the change in either the net deferred income and mining tax liability or asset balance for the year. The Company records a valuation allowance against any portion of those deferred income and mining tax assets when it believes, based on the weight of available evidence, it is more likely than not that some portion or all the deferred income and mining tax assets will not be realized.
Recent Accounting Pronouncements:
In November 2024, the FASB issued ASU 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40). Amended guidance requires more detailed disclosures about the nature of expenses included in the Consolidated Statements of Operations and Comprehensive Income (Loss). The amendments are effective for fiscal years beginning after December 15, 2026, and interim periods within fiscal years beginning after December 15, 2027. The Company is currently evaluating the impact on reporting requirements.
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FORWARD-LOOKING STATEMENTS
This report contains or incorporates by reference “forward-looking statements”, as that term is used in federal securities laws, about our financial condition, results of operations and business. These statements include, among others:
These statements may be made expressly in this document or may be incorporated by reference to other documents that we will file with the SEC. Many of these statements can be found by looking for words such as “believes”, “expects”, “anticipates”, “estimates” or similar expressions used in this report or incorporated by reference in this report.
Forward-looking statements and information are based upon several estimates and assumptions that, while considered reasonable by management, are inherently subject to significant business, economic and competitive uncertainties, risks and contingencies, and there can be no assurance that such statements and information will prove to be accurate. Therefore, actual results and future events could differ materially from those anticipated in such statements and information.
Included among the forward-looking statements and information that we may provide is production guidance. From time to time the Company provides guidance on operations, based on stand-alone budgets for each operating mine. In developing the mine production portion of the budget, we evaluate several factors and assumptions, which include, but are not limited to:
● gold and silver price forecasts.
● average gold and silver grade mined, using a resource model.
● expected tonnes moved and strip ratios.
● available stockpile material (grades, tonnes, and accessibility).
● estimated mill recovery rates (San José mine and Fox Complex).
● dilution of material processed.
● internal and contractor equipment and labor availability.
● seasonal weather patterns.
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Actual production results are sensitive to variances in any of the key factors and assumptions noted above. As a result, we frequently evaluate and reconcile actual results to budgeted results to determine if key assumptions and estimates require modification. Any changes will, in turn, influence production guidance.
We caution you not to put undue reliance on these forward-looking statements, which speak only as of the date of this report. Further, the information contained in this document or incorporated herein by reference is a statement of our present intention and is based on present facts and assumptions, and may change at any time and without notice, based on changes in such facts or assumptions. Readers should not place undue reliance on forward-looking statements.
RISK FACTORS IMPACTING FORWARD-LOOKING STATEMENTS
Important factors that could prevent us from achieving our stated goals and objectives include, but are not limited to, those set forth in the “Risk Factors” section and the following:
● decisions of foreign countries, banks, and courts within those countries.
● operating results of MSC and McEwen Copper.
● timing and amount of mine production.
● our ability to retain and attract key personnel.
● technological changes in the mining industry.
● changes in operating, exploration or overhead costs.
● results of current and future exploration activities.
● changes in our business strategy.
● the uncertainty of reserve estimates and timing of development expenditures.
● litigation or regulatory investigations and procedures affecting us.
● changes in federal, state, provincial and local laws and regulations.
● accidents, public health issues, and labor disputes.
● uncertainty relating to title to mineral properties.
● decisions by third parties over which we have no control.
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We undertake no responsibility or obligation to update publicly these forward-looking statements, except as required by law and we may update these statements in the future in written or oral statements. Investors should take note of any future statements made by or on our behalf.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK
Our exposure to market risks includes, but is not limited to, the following risks: changes in foreign currency exchange rates, equity price risks, commodity price fluctuations, credit risk and inflationary risk. We do not use derivative financial instruments as part of an overall strategy to manage market risk.
Further, our participation in the joint venture with Hochschild for the 49.0% interest held at MSC, and 46.3% ownership in McEwen Copper as of December 31, 2025, each creates additional risks because, among other things, we do not exercise decision-making power over the day-to-day activities at MSC or McEwen Copper; however, implications from our partner’s decisions may result in us having to provide additional funding to MSC or McEwen Copper, or result in a further decrease in our percentage of ownership.
Foreign Currency Risk
In general, the devaluation of non-U.S. dollar currencies with respect to the U.S. dollar has a positive effect on our costs and liabilities which are incurred outside the U.S. while it has a negative effect on our assets denominated in non-U.S. dollar currency. Although we transact most of our business in U.S. dollars, some expenses, labor, operating supplies and property and equipment are denominated in Canadian dollars, Mexican pesos, and Argentine pesos. In respect of McEwen Copper and MSC, the Argentine peso is used to conduct a significant portion of their business.
Since 2008, the Argentine peso has been steadily devaluing against the U.S. dollar by 10% to 73% on an annual basis. As noted in the graph below, during 2025 the Argentine peso devalued 30% compared to devaluations of 37% and 73% in 2024 and 2023 respectively.
During 2025, the Mexican peso appreciated 12% against the US dollar, compared to a depreciation of 15% in 2024 and an appreciation of 14% in 2023. During 2025, the Canadian dollar appreciated by 3.3% against the U.S. dollar, compared to a depreciation of 5.6% in 2024 and an appreciation of 1.3% in 2023.
The following chart illustrates changes in the value of these currencies compared to the U.S. dollar in the twelve months ended December 31, 2025:
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The value of cash and cash equivalents denominated in foreign currencies also fluctuates with changes in currency exchange rates. Appreciation of non-U.S. dollar currencies results in a foreign currency gain on such investments and a depreciation in non-U.S. dollar currencies results in a loss. We have not utilized material market risk-sensitive instruments to manage our exposure to foreign currency exchange rates but may do so in the future. As of December 31, 2025, 96.5% of our foreign currency holdings was held in Canadian dollars, representing 14.5% of our total treasury. We held minor positions in Mexican and Argentine Pesos.
Based on our Canadian cash balance of $7.4 million (C$10.3 million) as at December 31, 2025, a 1% fluctuation in the Canadian dollar would result in a gain/loss of less than $0.1 million in the Consolidated Statements of Operations and Comprehensive (Loss) Income. We also hold negligible portions of our cash reserves in Mexican and Argentine pesos, with effect of a 1% change in this currency resulting in gains/losses immaterial for disclosure purposes.
Furthermore, we are also subject to foreign currency risk on the fluctuation of the Mexican peso on our VAT receivable balance. As of December 31, 2025, our VAT receivable balance was MXN15.5 million, equivalent to approximately $0.9 million, for which a 1% change in the Mexican peso would have resulted in a gain/loss of less than $0.1 million in the Consolidated Statements of Operations and Comprehensive (Loss) Income.
MSC holds a portion of its local cash balances in Argentine pesos and is therefore exposed to the effects of this continued devaluation and also the risk that there may be a sudden severe devaluation of the Argentine peso. A severe devaluation could result in material foreign exchange losses as reported in U.S. dollars.
Equity Price Risk
We have invested and may continue to invest in shares of common stock of other entities in the mining sector. Some of our investments may be highly volatile and lack liquidity caused by lower trading volumes. As a result, we are inherently exposed to fluctuations in the fair value of our investments, which may result in gains or losses upon their valuation. Based on the marketable securities balance of $21.1 million as at December 31, 2025, a 1.0% change in fair value would result in a gain or loss of approximately $0.2 million.
We have in the past sought and will likely in the future seek to acquire additional funding from the sale of common stock or other equity securities. Movements in the price of our investments have been volatile in the past and may also be volatile in the future. As a result, there is a risk that we may not be able to sell equity securities at an acceptable price to meet future funding requirements.
In February 2025, we raised gross proceeds of $110.0 million through the issuance of Convertible Senior Notes due August 15, 2030, as further described in Note 10 to the consolidated financial statements. In connection with the offering, we entered into separate Capped Call Transactions intended to offset potential dilution upon conversion of the Convertible Notes. These transactions, which are subject to customary anti-dilution adjustments, cover the aggregate number of shares of common stock initially underlying the Convertible Notes.
Commodity Price Risk
We produce and sell gold and silver. Changes in the market price of gold and silver have and will in the future significantly affect the results of our operations and cash flows. Changes in the price of gold and silver could materially affect our revenues. Based on our revenues from gold and silver sales of $197.6 million for the full year December 31, 2025, a 10% change in the price of gold and silver would have had an impact of approximately $19.8 million on our revenues. Changes in the price of gold and silver can also affect the provisionally priced sales that we make under sales agreements. At December 31, 2025, we had no gold or silver sales subject to provisional pricing at our 100% owned operations.
We have in the past and may in the future hold a portion of our treasury in gold and silver bullion, where the value is recorded at the lower of cost or market. Gold and silver prices will affect the value of any bullion that we hold in treasury. We do not hedge any of our sales and are therefore subject to all changes in commodity prices.
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Credit Risk
We may be exposed to credit loss through our precious metals and doré sales agreements with financial institutions and refineries if these customers are unable to make payment in accordance with the terms of the agreements. However, based on the history and the financial condition of our counterparties, we do not anticipate that any of our customers will default on their obligations. As of December 31, 2025, we do not believe we have any significant credit exposure associated with precious metals and our doré sales agreements.
In Nevada and Ontario, Canada we are required to provide security to cover our projected reclamation costs. As at December 31, 2025, we have surety bonds of $48.2 million in place to satisfy bonding requirements for this purpose. The bonds have an annual fee of 2.4% of their value and require an average deposit of 7.2% of the amount of the bond. Although we do not believe we have any significant credit exposure associated with these bonds or the deposit, we are exposed to the risk that the surety may default in returning our deposit or that the surety bonds may no longer be accepted by the governmental agencies as satisfactory reclamation coverage, in which case we would be required to replace the surety bonding with cash.
Interest rate risk
Our outstanding debt consists of the $110.0 million convertible notes due 2030, the $20.0 million term loan facility, and various equipment leases. As the convertible notes and term loan have fixed coupons, we do not have any significant exposure to interest rate risks.
Inflationary Risk
Argentina has experienced a significant amount of inflation over the last ten years and has now been classified as a hyperinflationary economy. ASC 830 defines a hyperinflationary economy as one where the cumulative inflation rate exceeds 100% over the last three years which precede the reporting period. In this scenario, ASC 830 requires companies to change the functional currency of its foreign subsidiaries operating in a hyperinflationary economy, to match the company’s reporting currency. In our case, the functional currency of all our Argentine subsidiaries has always been our reporting currency, the U.S. dollar. As such, we do not expect the classification of Argentina’s economy as a hyperinflationary economy, to change our financial reporting methodology.
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ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA
Index to Financial Statements: Page
Management’s Report on Internal Control Over Financial Reporting 90
Reports of Independent Registered Public Accounting Firm (PCAOB ID: 1263) 91
Consolidated Balance Sheets as of December 31, 2025, and 2024 96
Notes to Consolidated Financial Statements 100
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MANAGEMENT’S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING
The management of the Company is responsible for establishing and maintaining adequate internal control over financial reporting. The Securities Exchange Act of 1934 defines internal control over financial reporting in Rule 13a-15(f) and 15d-15(f) as a process designed by, or under the supervision of, the Company’s principal executive and principal financial officers and effected by the Company’s Board of Directors, management and other personnel, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles and includes those policies and procedures that:
All internal control over financial reporting processes and systems, no matter how well designed, have inherent limitations. Therefore, even processes and systems deemed to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate due to changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
The Company’s management assessed the effectiveness of the Company’s internal control over financial reporting as of December 31, 2025. In making this assessment, the Company’s management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework (2013). Based upon its assessment, management concluded that, as of December 31, 2025, the Company’s internal control over financial reporting was effective based upon those criteria.
Ernst & Young LLP, an independent registered public accounting firm, has audited the effectiveness of the Company’s internal control over financial reporting as of December 31, 2025. Ernst & Young LLP’s report on our internal control over financing reporting as of December 31, 2025 can be found under Item 8, Financial Statements and Supplementary Data.
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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and the Board of Directors of McEwen Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated balance sheets of McEwen Inc. (the “Company”) as of December 31, 2025 and 2024, the related consolidated statements of operations and comprehensive income (loss), changes in shareholders’ equity and cash flows for each of the three years in the period ended December 31, 2025, and the related notes(collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with U.S. generally accepted accounting principles.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework), and our report dated March 16, 2026 expressed an unqualified opinion thereon.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.
Critical Audit Matters
The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective or complex judgments. The communication of the critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.
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Valuation of Material on Leach Pad
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Income Taxes - Valuation Allowance for Deferred Tax Asset in the United States
/s/ Ernst & Young LLP
Chartered Professional Accountants
Licensed Public Accountants
We have served as the Company’s auditor since 2016.
Toronto, Canada
March 16, 2026
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REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
To the Shareholders and the Board of Directors of McEwen Inc.
Opinion on Internal Control Over Financial Reporting
We have audited McEwen Inc.’s internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the “COSO criteria”). In our opinion, McEwen Inc. (the “Company”) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on the COSO criteria.
We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB) , the consolidated balance sheets of the Company as of December 31, 2025 and 2024, the related consolidated statements of operations and comprehensive income (loss), changes in shareholders' equity and cash flows for each of the three years in the period ended December 31, 2025, and the related notes and our report dated March 16, 2026, expressed an unqualified opinion thereon.
Basis for Opinion
The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects.
Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.
Definition and Limitations of Internal Control Over Financial Reporting
A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.
/s/ Ernst & Young LLP
Chartered Professional Accountants
Licensed Public Accountants
Toronto, Canada
March 16, 2026
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McEWEN INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(in thousands of U.S. dollars, except per share amounts)
Year ended December 31,
OTHER OPERATING INCOME (EXPENSES):
Income from investment in Minera Santa Cruz S.A. (Note 9) 41,125 9,021 62
OTHER INCOME (EXPENSES):
Interest and other finance (expenses) income, net (7,217) (4,595) 36,918
Gain on deconsolidation of McEwen Copper Inc. (Note 9) — — 222,157
Income (loss) before income and mining taxes 6,949 (46,739) 67,036
Net income (loss) after income and mining taxes 34,434 (43,691) 33,177
Net loss attributable to non-controlling interests — — 22,122
Net income (loss) per share (Note 14):
The accompanying notes are an integral part of these consolidated financial statements.
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McEWEN INC.
CONSOLIDATED BALANCE SHEETS
(in thousands of U.S. dollars)
As at As at
December 31, December 31,
ASSETS
Current assets:
Cash and cash equivalents (Note 4) $ 51,015 $ 13,692
Marketable securities (Note 5) 21,114 1,617
Receivables, prepaids and other current assets (Note 6) 5,752 7,486
Due from McEwen Copper Inc. (Note 15) 3,169 286
Due from McEwen Copper Inc. (Note 15) 6,052 —
Deferred tax assets (Note 19) 25,591 —
Other assets 34 102
LIABILITIES & SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued liabilities $ 44,911 $ 28,448
Reclamation and remediation liabilities (Note 12) 6,473 4,988