Iamgold Corp Q1 FY2026 Earnings Call

Thank you for standing by. This is the conference operator. Welcome to the IAMGOLD First Quarter 2026 Operating and Financial Results Conference Call and Webcast. The conference is being recorded. At this time, I would like to turn the conference over to Graeme Jennings, VP Business Development and Investor Relations for IAMGOLD. Please go ahead, Mr. Jennings.

Thank you, operator, and welcome, everyone, to our conference call this morning. Joining us on the call are Renaud Adams, President and Chief Executive Officer; Marthinus Theunissen, Chief Financial Officer; Bruno Lemelin, Chief Operating Officer; Ankit Shah, Chief Strategy Officer; and Annie Katie Legacy, Chief Legal Officer. We are calling today from IAMGOLD's office, which is located on Treaty 13 territory on the traditional lands of many nations, including the Mississaugas of the Credit, the Anishinaabe, the Haudenosaunee and the Wendat peoples. At IAMGOLD, we believe respecting and upholding Indigenous rights is founded upon relationships that foster trust, transparency and mutual respect. Please note that our remarks on today's call will include forward-looking statements and refer to non-IFRS measures. We encourage you to refer to the cautionary statements and disclosures on non-IFRS measures included in the presentation and the reconciliations of these measures in our most recent MD&A, each under the heading non-GAAP financial measures. With respect to the technical information to be discussed, please refer to the information in the presentation under the heading qualified person and technical information. The slides referenced on this call can be viewed on our website. I will now turn the call over to our President and CEO, Renaud Adams.

Thank you, Graeme, and good morning, everyone, and thank you for joining us today. Before I start, I'd like to welcome Ankit Shah, who will join IAMGOLD on Monday as our Chief Strategy Officer. Ankit, who many of you on the call are familiar with, brings to our team nearly 20 years of strategy, corporate development and capital markets experience at a very exciting time for this company. So welcome, Ankit. IAMGOLD is off to a strong start to 2026. In the first quarter, we produced 183,600 attributable ounces of gold, positioning us well to achieve our full year guidance of 720,000 to 820,000 ounces. The quarter was marked by robust financial results, with revenue exceeding $1 billion and mine-site free cash flow of $525 million. The cash flow we are generating is allowing us to execute on all fronts. In the first quarter alone, we returned $260 million to shareholders through our share buyback program and repaid $100 million of debt on our credit facility while increasing our cash position. These results reflect the significant leverage of our business to the current gold price environment and, more importantly, the quality of the assets we have built and the teams that operate them. But what excites me most is where IAMGOLD is headed. I believe we are entering one of the most catalyst-rich periods in the company's history. Over the next 12 to 18 months, we expect to deliver updated technical reports across each of our assets: Côté, Westwood, Essakane and the Nelligan Mining Complex. These studies are expected to outline a larger, longer-life production profile that we believe will redefine how the market views IAMGOLD. At Côté, the year-end technical report is expected to contemplate significantly larger-scale operations incorporating both the Côté and Galindo pits, supported by an updated mineral resource estimate coming this quarter. At Nelligan, we are advancing one of the largest preproduction gold camps in Canada towards a preliminary economic assessment next year. And at Westwood, we see meaningful potential for mine life extension and production growth. We will get into the detail on each of these through the presentation today. When I look at IAMGOLD today—with $2 billion of EBITDA generated over the last 12 months, a strengthened balance sheet and an increasing production profile, catalysts at every asset and meaningful capital being returned to shareholders—I see a company that is delivering on its promises and building something very exceptional. We are well positioned to create significant value in 2026 and beyond, and I look forward to walking you through the details. With that, let's get into the quarter. Starting with health and safety. In the quarter, our total recordable injury rate was 0.44, a measurable improvement from the prior year period. I would like to highlight two big achievements in the quarter: Essakane mine achieved a safety milestone in the first quarter, and Westwood achieved its first full quarter at zero lost-time incidents, a goal every mine site strives to reach. I want to thank our teams across our operations and in the field for the continued commitment to safe and responsible mining, as safety is where it starts for us. Looking at operations, as I noted, IAMGOLD produced 183,600 ounces to our account in the first quarter. Côté attributable production of 52,300 ounces was impacted by reduced throughput due to unplanned downtime associated with wear on a conveyor belt as crushed ore volumes significantly increased following the commissioning of the second crusher. This belt will be replaced in May, after which we expect to operate at full capacity with an improving cost profile through the year as debottlenecking of the secondary crusher allows us to phase out the aggregate crusher. Meanwhile, Essakane and Westwood both had a very strong start to the year, demonstrating the value of having a diversified portfolio of producing assets. Cash costs, excluding royalties, were $1,301 per ounce in the quarter, tracking well within our full year guidance range. Including royalties, cash costs were $1,608 per ounce, and all-in sustaining costs were $2,124. It is worth highlighting that both Côté and Essakane carry significant royalty structures, which are directly linked to the gold price in a quarter where the realized gold price was nearly $4,900 an ounce. The royalty component is naturally higher than what our guidance assumes at $4,000. As a reference, this worked out to around $115 per ounce increase in cash costs for a $1,000 per ounce increase in the gold price from royalty alone. Meanwhile, on input costs, the ongoing conflict in the Middle East has introduced additional volatility to energy markets, and we did see oil prices move higher towards the end of the quarter. Côté in particular has meaningful exposure given its reliance on diesel and heavy fuel oil to power both processing and the mining fleet. On a consolidated basis, a $10 per barrel increase translates to approximately $12 per ounce increase in cash costs. We are actively monitoring energy price movement and potential supply chain impacts across all of our operations. With that, I will pass the call over to our CFO to walk us through our financial matters. Marthinus?

Thank you, Renaud, and good morning, everyone. The current gold market and our operating results have resulted in strong financial results and considerable free cash flow being generated, which allows us to continue to execute on our capital allocation strategy to maximize value. We produced $524.6 million of mine-site free cash flow, defined as operating cash flow minus capital expenditure from each operation. Of that, $228.4 million of the funds was used to strengthen our balance sheet by repaying $100 million of the credit facility and we also increased cash by $128.3 million. For the shareholder return component, we purchased $260 million of shares as part of the share buyback program. Subsequent to quarter end, we purchased an additional 2.1 million shares for $40 million, which brings the total share repurchase by IAMGOLD since the start of the program last December to $350 million. In addition, we completed the debt repayment component of our plan and paid down the remaining $100 million balance of the credit facility, making the full facility available. The company intends to continue to use cash flow from Essakane to fund its share buyback program at approximately the same rate of cash generated and we anticipate repatriating funds from Essakane over the course of 2026. Naturally, the actual number of common shares that may be purchased, if any, and the timing of such purchases will be determined by the company based on a number of factors, including the gold price, the company's financial performance, the availability of cash flows, consideration of uses of cash and our strategic allocation. In terms of the financial position, at the end of the quarter, IAMGOLD had $505.2 million in cash and cash equivalents with $100 million outstanding on the credit facility, resulting in liquidity at the end of March of approximately $1.1 billion. With the $400 million term loan we paid at the end of last year, and the repayment of our credit facility, IAMGOLD today is in a net cash position, a significant milestone for a company that a year ago was carrying over $800 million in net debt. Within cash and cash equivalents, we note that $281.9 million was in the shareholder account at the end of the quarter. The cash balance in this account increased during the quarter and will be used to fund tax payments in April and the government of Burkina Faso's portion of the 2026 dividend payable in June. The company uses the shareholder account structure to repatriate funds in excess of working capital requirements. Turning to our financial results, revenues from operations totaled $1 billion from sales of 211,500 ounces on a 100% basis, at an average realized price of $4,856 per ounce. The record gold price and operating results resulted in adjusted EBITDA of $666 million in the first quarter of the year, which brings the trailing 12-month EBITDA to a total of approximately $2 billion. At the bottom line, adjusted earnings per share for the quarter was $0.67. Looking at the cash flow reconciliation for the quarter, it offers a good visualization of the major drivers in the quarter. We saw good conversion of EBITDA into operating cash flow with $629.5 million of operating cash flow before working capital changes. As stated earlier, the significant operating cash flow allowed for the funding of our capital expenditure of $101.6 million and $260 million under the share buyback program. We paid $100 million of the credit facility, while still resulting in an increase in cash of $128.3 million. As we look ahead with the debt prepayment fully executed, we will continue to see the share buyback funded by using cash flow from Essakane and the remaining cash going to our balance sheet to further strengthen it as we evaluate the best use of the funds to increase value of the business. We are evaluating an appropriate time to introduce a dividend that would likely be at the end of the year or early next year. It is worth reinforcing how we think about our capital allocation framework today. The Canadian platform, consisting of Côté and Westwood, is generating sufficient cash flow to fund the company's Canadian operations and corporate activities as well as our internal growth plans over the next three years. This is important because it means that the cash repatriated from Essakane can be directed to fund our capital return to shareholders that currently consists of the share buyback program. We continue to evaluate the program and believe that this is currently the most prudent use of capital. With that, I will pass the call to Bruno Lemelin, our Chief Operating Officer, to discuss our operating results and outlook. Bruno?

Thank you, Martin. Starting with Côté. Looking at the quarter, Côté produced 74,700 ounces on a 100% basis. Mining activity totaled 9.3 million tonnes of material mined, with 3.6 million tonnes of ore, representing a strip ratio of 1.6. Total tonnes mined were lower in January and February as the operation completed overburden removal activity required to open up the pit while managing seasonal winter conditions. Mining activity in March included blasting and pushback activity in the pit area. The ore mined in the quarter averaged 0.99 grams per tonne, in line with the mine plan. Net throughput in the quarter was 2.3 million tonnes. As we noted in our results, throughput was limited due to downtime on the conveyor that feeds material from the primary and secondary crushers to the screening building. This downtime was primarily due to the increased load on the conveyor following the installation of the secondary crusher, putting additional stress on areas of the conveyor belt that had already experienced wear. We were able to finalize repairs in early April. We then saw improved performance of the belt when the plant averaged 32,000 tonnes per day over the month. Later this month, we are installing a new, heavier gauge belt, which will allow the circuit to resume full operations above nameplate. In summary, the conveyor situation is not structural in nature, but an isolated, nonrecurring early mine item. We are seeing fewer of these as the operations stabilize as we step forward versus the past 12 to 24 months. Côté is transitioning into a phase focused on operating discipline and consistent execution. Net grades for the first quarter were 1.07 grams per tonne, in line with the guidance for the year of 1.1 grams per tonne with recoveries of approximately 93%. We continue to be very pleased with the reconciliation between the reserve model, the grade model and production. Production is expected to increase quarter-over-quarter as throughput increases in Q2 and on higher grades in the second half of the year. We remain on track with Côté production guidance of 390,000 to 440,000 ounces for the year. Looking at costs, Côté reported first quarter cash costs, excluding royalties, of $1,359 per ounce and all-in sustaining costs of $2,109 per ounce. We have been clear with our plan to lower our costs this year, and that plan is still in place. Our goal is to exit the year with mining cost and processing cost reductions in the mid-teens. The primary drivers to lower costs this year are fourfold: one, increased throughput from the mill and higher production; two, to significantly reduce and remove reliance on the contracted aggregate crusher; three, improved maintenance cycle and overall plant performance; and four, to realize operational efficiencies as the mine reaches its fifth year of operations. The second cone crusher is operating well, which has removed the bottleneck in the secondary crushing circuit. Later this quarter, the increased capacity will allow us to phase out the usage of the aggregate crusher, which we contracted last year to allow the plant to meet its 2025 goal. We have already realized benefits beyond the additional volume capacity with the HPGR seeing an immediate reduction in wear, which will translate to less rotor replacement over the course of the year. As Renaud pointed out, costs are affected by higher gold prices through royalties. In the first quarter, royalties accounted for $335 per ounce or about 20% of cash costs. Further, and this is something we've been asked about frequently of late, is the impact of rising oil prices. The plant and our area are connected to low-cost hydro for power, so effectively only our mining fleet is directly impacted by fuel prices. Based on our estimates, this translates to about $7 per ounce increase in cost per $10 increase in the price of oil. Looking forward this year to higher production and lower costs, all eyes are turned to what the next steps are once we have the updated resource estimate. The first step is the upcoming mineral resource estimate, which will combine both the Côté and Galindo into a single block model. The goal is to see additional upgrading of ounces into measured and indicated. The resource base will form the foundation of the Côté expansion mine plan, which is still on track to be announced in the fourth quarter of this year. The report will envision a near-term expansion of the Côté plant to 50,000 to 55,000 tonnes per day targeting a significantly larger resource from the updated resource. We expect the expansion to be highly accretive on a per-ounce basis as the near-term capital required for the plant expansion is relatively modest. The permitting and larger requirements for additional waste management and opening of Galindo will likely be staged over many years in the most time. Turning to Westwood. The mine continued its strong production, producing 26,300 ounces in the quarter as underground activities performed very well with excellent mining and blasting performance. Underground mining totaled 106,000 tonnes in the quarter with an average head grade from underground of 9.85 grams per tonne. In addition to underground production, the open pit mined 60,000 tonnes; operations prioritized waste stripping to open up access to additional ore with opportunities to further extend the mine. Net grade in the quarter was 4.03 grams per tonne at a blended average grade of 4.4 grams per tonne and recoveries of 92%. Together, Westwood produced $110 million of mine-site free cash flow in the first quarter, bringing the last 12 months of cash flow generation to $242 million. Westwood demonstrates what disciplined execution and incremental optimization can deliver: safe operations, stable production, expanding optionality and strong free cash flows without step-change capital. As a result of the strong quarter, cash costs averaged $1,270 per ounce and all-in sustaining costs averaged $1,733 per ounce, well below the guidance ranges for the year. We have seen modest mining cost increases on a per-unit basis associated with increased diesel prices and higher explosive costs. Looking ahead, our teams are quite excited for the future this year. We are spending about $30 million on expansion capital that has been used to explore the eastern extension of the mine. We are seeing the continuity of mineralization in this area—our project teams are currently drifting into this area to complete both development and testing. The company plans to publish an updated technical report on Westwood in the second half of 2027, which is expected to extend the life of mine and highlight the potential for mining in this eastern zone. This approach would potentially support higher overall underground throughput, and conceptually would allow for increased gold production at improved mining costs, allowing the mill to be filled with higher-margin material. Turning to Essakane. The mine reported record production of 111,900 ounces on a 100% basis, as rates continue to benefit from positive reconciliation as mining progresses deeper into Phase 7. As a result of the strong performance, mine-site free cash flow from Essakane was $302.7 million in the quarter, bringing the total cash generated by Essakane over the last 12 months to $803.6 million. On operations, mining totaled 11.9 million tonnes versus 2.2 million tonnes of ore, translating to a strip ratio of 4.4:1. The higher proportion of waste was a result of the initial pushback for the pit expansion. The mill reported in-line throughput of 3.1 million tonnes, which was a good achievement as the plant completed its annual work. Head grade averaged 1.24 grams per tonne coming off the record grade last quarter. Despite the positive reconciliation impact, we are maintaining our guidance for the year of 1.1 grams per tonne. Essakane came within guidance ranges with cash costs excluding royalties of $1,083 per ounce and all-in sustaining costs of $2,125 per ounce. Mining costs benefited in the quarter due to gains from initial satellite workings of the leveled pit, resulting in reduced fuel consumption. On a project basis, these savings were offset by higher consumable costs and liner replacements. Essakane also has exposure to the gold price through royalties. In the first quarter, royalties accounted for $597 per ounce or 35% of cash costs. Further, Essakane is heavily reliant on fuel for the usage between processing and mining; it is estimated that a $10 increase in the price of oil per barrel would equate to about $20 per ounce increase in cash costs and in all-in sustaining costs respectively. At this time, our fuel supply has not been impacted by the conflict in the Middle East; however, price and supply remain risks. The company is actively monitoring the situation and implementing measures that are within its control. Essakane continues to be a highly cash-generative asset, delivering strong free cash flow while operating optionality to an updated mine plan that could be a potential five-year expansion of its current life of mine. In the first half of 2027, IAMGOLD expects to release the updated plan, which would extend the mine to 2033. Today, Essakane supports 4.4 million ounces of measured and indicated resources with more potential supported by ongoing drilling. With that, I will pass it back to Renaud.

Thank you, Bruno. This brings us to the Nelligan Mining Complex. The first quarter was the first full quarter that we controlled the consolidated district and our exploration teams have been drilling to expand mineralization at Filbee, Milligan and Monster Lake, while prioritizing targets for further discovery. This year, we will be drilling over 60,000 meters to advance the project so we can release our initial PEA study to the market in the first half of next year. The Nelligan Mining Complex already has a significant mineral inventory of over 4.3 million ounces of measured and indicated and 7.5 million ounces of inferred resources, and we believe there is meaningful upside to those numbers. Many of these deposits and targets have not had a sustained or well-funded exploration program behind them. That is changing now, and we expect the mineral inventory to continue to grow as we put capital to work across the district. We expect the study to outline a project with a central processing facility being fed from multiple ore sources within a 17-kilometer radius. Considering the mineral wealth and potential for growth and the fact that IAMGOLD owns 100% of the Nelligan Mining Complex, it has the potential to be among IAMGOLD's largest mines. The Nelligan Mining Complex is already positioned as one of the largest preproduction gold projects in Canada. What makes it truly compelling is the combination of district-scale consolidation across multiple million-ounce deposits, the ease of access, the combination of underground and open-pit mining and the fact that it is located in Quebec, one of the premier mining jurisdictions in the world. Taken together, we believe these attributes position Nelligan as a premium asset in our portfolio and one where we expect to unlock significant value as we advance the project through the study process. So with that, I want to thank our shareholders for your support. We truly believe it will be an exciting year for IAMGOLD with significant value growth opportunities ahead, including the upcoming resource update at Côté, the Côté expansion study later this year, followed by next year where we outline a mine life extension at Essakane in the first half of the year, an initial study wrapping economics around the Nelligan Mining Complex also in the first half of next year, and a mine life extension study for Westwood in the second half of next year. So altogether, we have significant value accretion catalysts ahead. With that, I would like to pass the call back to the operator for the Q&A portion of the call. Operator?

We will now open the call for questions. Please go ahead with your questions.

My first question is on Essakane. Are you seeing any risks in terms of potential supply disruptions for diesel or heavy fuel oil over there? How much inventory do you currently have on site? You also talked about the direct cost impact from higher oil prices, but how should we think about the indirect inflationary pressures?

So maybe, Marthinus, you take that.

Sathish, we are de-risking the fuel supply at Essakane. We have supply on site that's five to six weeks, and we try to maintain that at maximum capacity. We have also secured additional fuel up the supply chain, so Essakane has already secured sufficient fuel for the next two to three months. The direct impact on the actual cost from fuel that is linked to the market price is about $20 per ounce per $10 per barrel increase in oil. There are other costs at Essakane as well—there are taxes on fuel and those impacts—but we have not seen other significant inflationary pressures at Essakane or the other mines at this point, and it's hard to estimate those. If you look at our energy cost as a company, it is about 20% of our operating cost and our consumables are about 15% to 16%. So that's the level of our cost structure that could be impacted by inflationary pressures, but it is difficult to predict exactly how that would evolve.

Okay. My second question is on Côté. How should we look at the quarterly guidance for production and cost, especially for the second quarter with the reduced operating capacity and the scheduled maintenance shutdown in May? Should we expect average milling rates and costs to improve versus the first quarter, or is it more of a second-half story?

We expect that once we have completed the shutdown in mid-May—it's meant to be around May 20—we will be replacing the conveyor belt and also the HPGR tires that were due to be changed earlier in the year. We will make some adjustments in certain areas, but after that, we're expected to resume full operation and potentially operate beyond nameplate capacity. Expectations on both the mining and processing sides are that unit costs will decrease and we will see a sharp improvement in gold production quarter-over-quarter.

This is Graeme. And you'll note in our news release that we refined our throughput guidance for Côté to 12 million to 13 million tonnes for the year.

Okay. Congrats on a strong year-to-date buyback program.

The next question comes from Anita Soni with CIBC.

I just wanted to ask a little bit about Westwood. This quarter, there was a little bit lower production from the Grande deposit or from the open pit—I'm not sure if it's still Grande. How long do you expect that to continue? I think I heard into 2027, but I was just trying to figure out when it ends and the ramp-up in 2026 in terms of the tonnage over the course of the year.

This is Bruno. Good question. We are seeing the grade profile extended even beyond 2027. We also have options in Phase 5 that could extend operations beyond 2029. We're currently evaluating those options, and they represent strong support for Westwood. The moment the contribution from Grande tapers off, it would be a great moment for the eastern zone of the underground to replace that material.

If I may add, Anita: what I really like about the work that's been done and the drilling in the last two years is that our effort has been to protect the production profile on the upside. The potential from Grand Duke, should we be able to maintain it to 2029–2030 followed after that by an increase from the underground in the East, is the focus right now. So you shouldn't see any production gap; if anything, we expect the profile to be stable or to increase. It's a combination of monitoring and evaluating, and we are focused on offsetting any potential shortfalls.

It's Martin. I agree—we had a great quarter. If you look at the dollar per tonne for the underground mine, we do expect it may increase slightly and settle back around the $300 to $325 per tonne level for the rest of the year, which is consistent with our full-year expectations. So we don't expect Q1 to necessarily be the norm for the year.

We would of course like to sustain the low costs, but there are some areas of the mine that require more support than others, so performance will depend on exactly where the teams are mining. Our focus is to remain at the lower cost levels, while recognizing some variability.

Okay. And my other question on Côté throughput—when you say above nameplate, I heard a comment about going beyond nameplate. I'll leave it there and get back in the queue if I have any follow-up. Thank you.

The next question comes from Tanya Jakusconek with Scotiabank.

Maybe I'll do the financial one first. Marthinus, maybe you can talk about the $400 million dividend after tax that you're getting in from Essakane. Should I think that all of that could be going to share buyback in Q2 or Q3? How should I think about the payment of the $400 million for the share buyback from a quarterly perspective?

Tanya. We have about $200 million left in the shareholder account from last year's dividend. We expect that cash to be repatriated by June or July of this year. The timing is affected by tax payments in Q2 as well as the government of Burkina Faso's portion of the dividend. We expect to repatriate cash at a rate of roughly $40 million to $50 million a month for the remainder of this quarter. We received about $40 million in April. So getting to the $400 million for the year is likely to be spread over the middle of the year. For the share buyback, we will continue to evaluate the timing. But the $400 million declared is now a new shareholder account and as we repatriate cash from Essakane, we would continue to use that to potentially fund share buybacks for the second half of the year and into next year. The exact sequence will be gold-price dependent.

Okay. Great. That's very helpful. My other financial question is just on taxes—taxes were quite low in Q1. When I look at your guidance and what you paid, it was significantly lower. Maybe a little bit about what's happening there and how you see the rest of the year coming out in terms of taxes?

From a cash tax perspective, our guidance implies about 14% on a full-year basis. If you look at how we spread it over the course of the year, we expect lower cash tax in Q1 and Q4, with the majority of cash tax in Q2 and Q3. This pattern is driven by a cash tax payment in Q2 and the withholding tax payment on the dividend, which is normally either at the end of Q2 or the beginning of Q3.

Okay. And then maybe Renaud, on the updated resource that is coming out on Côté this quarter: should I be thinking that you'll be upgrading inferred into measured and indicated and that you're targeting about 20 million ounces of measured and indicated? Should I expect a material increase to reserves this year or is that reserve conversion a later step tied to the study?

Thanks for the question. We've been socializing this quite a bit. If you look at our year-end mineral resource, we were sitting below about 19 million ounces of measured and indicated. There were still some holes to be integrated into the database and some additional work in the saddle. In short, our confidence remains that there will be additional conversion to measured and indicated and our objective is to reach roughly 20 million ounces of measured and indicated. That will form the basis for reserves. We will clarify the resource in Q2; the reserve will be the result of conversion from the resource and will be more fully detailed in the study later in the year. We expect a significant increase in reserves out of the updated resource, but the exact reserve numbers will be disclosed when the study triggers the reporting requirement.

Okay. That's what I thought was going to happen but I just wanted to make sure. And then on costs at Côté—should I be thinking the new study should have mining costs under $4 per tonne and processing around $12 to $14 per tonne as a combined entity? Those costs were quite high this quarter, but I'm trying to understand the benchmark for the study.

You're right to point out costs are higher in the short term. As we've highlighted, the use of the aggregate crusher earlier and shortfalls in capacity pushed the HPGR beyond design criteria and accelerated wear. We've been working to return to design criteria with the second crusher and the expected HPGR maintenance. We remain confident in our cost reduction pathway. This is a multi-year optimization and not all reductions will occur in one year; they will be phased over two to three years as we implement the expansion and optimization work. Bruno, maybe you can outline the main focus for the second half of the year on cost reduction.

For mining cost, you will see meaningful improvements in the second half of the year and for the remainder of the year. First, volumes increase is a major driver for Q1. As volumes increase, unit costs go down. Second, we have made great improvements in drill and blast performance, increasing productivity materially. We are also bringing in additional mining equipment to increase fleet availability. We are putting everything in place to be successful and to be below $4 per tonne before the end of the year. For processing costs, removing the aggregated crusher reliance and internalizing crushing will also lead to a sharp reduction in costs. We are making improvements across the operation. The optimization phase will take around three years to fully realize, but we are quite confident that the upcoming 43-101 will be based on realistic and achievable assumptions.

Understood—so that provides a basis to go forward. Maybe just my final question: earlier guidance suggested Essakane production would be relatively stable through the year with Westwood stable and Côté seeing quarter-on-quarter improvement and a stronger second half. Is that still how we should view the company-wide production profile for first half versus second half?

Yes. We expect a much stronger H2 versus H1. For Côté, grades and throughput are expected to improve in H2. Essakane is expected to be stable and remain within guidance as we integrate additional ore into the mine plan. Westwood is expected to be stable and safe with solid monthly production on average. Overall, you should expect a stronger H2 as we disclosed last quarter, taking into account winter conditions and the HPGR maintenance earlier in the year.

The next question comes from Mohamed Sidibe with National Bank.

Maybe if I could ask a question on the underground at Westwood: we've now seen two quarters with a mining rate above the 1,100 tonnes per day and grades over 9.8 grams per tonne mined. Could you help me understand how to think about the next few quarters in terms of mining productivity and where you expect it to integrate over the coming quarters?

The underground is performing very well. Our targets are around the 1,000 tonnes per day level, and we have been exceeding those metrics regularly. Improvements come from optimization, better engineering, better development preparation and improved drilling performance. We have ample capacity at surface, so throughput is not constrained. The additional productivity gives us strong confidence that incremental improvements will translate into higher gold production. The focus remains stabilizing operations and improving incrementally while prioritizing safety.

I appreciate you've seen a significant increase. Again, performance depends on where you mine. Our focus is reliable and safe operations. Staying in the zone of 1,000 to 1,200 tonnes per day is a good target, but we will always prioritize safety. We are comfortable with the recent performance and will work to sustain it safely.

That's very helpful. Thank you.

The next question comes from Joshua Wolfson with RBC.

I apologize; I'm having some trouble hearing some of the data points. Just going back to Côté: the comment about the plant operating above nameplate in the second half of the year and some of the tonnage numbers provided—those numbers look to imply maybe 10% to 15% above nameplate in the second half. Does that sound correct? And is it reasonable to assume those throughput levels can be sustained beyond 2026 even before the expansion takes hold?

Yes. When we say we can run above nameplate, we have seen performance above 36,000 tonnes per day and even up to 42,000 tonnes per day for short periods. With the addition of the second crusher and other stabilizing improvements to the HPGR, we expect to remain in the range between 36,000 and 42,000 tonnes per day on average. With planned shutdowns and maintenance, we're planning overall average throughput around the 36,000 tonnes per day level for the year, but operating above nameplate for sustained periods is promising and is a key part of our near-term optimization.

What we've experienced with the second crusher is a short period of good performance before we started to have the conveyor issues. The objective has always been to stabilize at the 36,000 tonnes per day average. To reach that average, you will need production above that level at times. We also expect somewhat better grades in the second half. The priority is to demonstrate a stable minimum 36,000 tonnes per day average across seasons; once we achieve that and phase out the aggregate crusher, we will continue to optimize step by step. So far, the crusher performance has been encouraging.

Okay. Got it. On grades you mentioned between 1.0 and 1.2 grams per tonne in the second half—was that the range you referenced?

Between 1.0 and 1.2 grams per tonne.

Yes. We reported 1.07 grams per tonne in the first quarter, and we could see quarters above the 1.07 grams per tonne as we progress into the second half.

Okay. And then on mining cost for Côté, recognizing Q1 is an outlier and energy prices are volatile, what is a reasonable mining cost assumption for the second half of the year? I know you have some oil hedges—perhaps you can comment on that as well.

One thing we didn't mention earlier is that we've actually put in some price protection for oil at Côté. For June as well as for all of Q3, Côté oil is hedged at a price of about $80 per barrel. So if the price goes above $80 per barrel during that period, it doesn't impact our cost further; we still participate if the price goes below that. That will help offset some of the energy cost volatility and support our objective to reduce mining costs as we exit the year. As noted earlier, we aim to bring mining costs down and processing costs into the mid-teens percentage improvements; that is the main focus as we work through the year while continuing optimizations beyond 2026.

This concludes the question-and-answer session. I would like to turn the conference back over to Graeme Jennings for any closing remarks.

Thank you very much, operator, and thanks, everyone, for joining us this morning. As always, if you have any follow-up questions, please reach out to Renaud or myself. Thank you all. Be safe and have a great day.

Thank you. This brings to a close today's conference call. You may disconnect your lines. Thank you for participating, and have a pleasant day.