Integra Resources Corp. (ITRG) Q2 2026 Earnings Report, Transcript and Summary

Good morning. My name is Rob, and I will be your conference operator today. At this time, I would like to welcome everyone to the Integra Resources Second Quarter 26 Results Conference Call. Lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question and answer session. If you would like to withdraw your question, again, press 1. Thank you. I would now like to turn the meeting over to Joshua Serfass, Vice President, Investor Relations. Please go ahead, Joshua.

Thank you, Rob. I would like to welcome everyone to Integra's 26 second quarter operating and financial results conference call. Before we begin, I would like to note that we will be making forward-looking statements during today's call. I will take you to the second slide of the earnings presentation, which contains important cautionary notes regarding these forward-looking statements. The cautionary notes can be found on Integra's corporate website. Please note all dollar amounts discussed today will refer to U. S. Dollars unless otherwise indicated. On the call today, I am joined by Integra's president, CEO, and director, George Gregory Salamis; Chief operating officer, Clifford Lafleur; Chief financial officer, Andree St-Germain; Vice president, finance, Sean Deissner; Vice president, permitting, Dale Kerner; and General manager of the Florida Canyon Mine, Greg Robinson. Today, we are pleased to provide an operating and financial update for the second quarter of 26. Followed by a live Q&A session. With that, I would like to hand the call over to George to kick things off.

Thanks, Joshua. Q2 was pivotal for the company. Florida Canyon remains the cash generator for Integra and the updated technical report and life of mine released in June demonstrates a bright future for Florida Canyon. The updated Life of Mine plan highlighted a longer mine life higher annual production, and strong free cash flow generation. Nearly 2 years of operating experience have enabled us to develop a more realistic stable, and executable mine plan that reflects the operating realities of the mine. The updated plan increases average annual gold production by 17% while providing a more consistent production profile over an 8-year mine life. Finally, strategic investments in fleet modernization and expanded heap leach capacity position Florida Canyon for sustainable long term growth lower operating costs, and continued value creation. DeLamar continues to advance through the federal permitting process under the National Environmental Policy Act. With the public scoping period now complete, and the Bureau of Land Management currently reviewing comments received on the project, In parallel, the company continues to advance detailed engineering and planning at DeLamar to prepare for future development. State of good-repair initiatives are also underway on-site. Including test mining, crushing optimization, truck shop repairs, general site preparation, and other low risk activities that will in fact shorten the development time line and reduce execution risk at DeLamar in the future. With the improved exploration plan of operations received at Wildcat, exploration drilling is expected to start soon. As we work on advancing economic studies. Now turning to slide 5, I will walk through our second quarter financial highlights before handing the call off to Clifford to cover Florida Canyon's operating results. Q2 was highlighted by a strong financial position with $111.1 million in and working capital of $146.5 million. Operationally, the quarter was marked by record throughput of 87.9 thousand total tons per day at Florida Canyon resulting in a 30% increase in gold production quarter over quarter. Florida Canyon produced 16.4 thousand ounces of gold in the quarter. Generated revenue of $70.8 million and operating cash flow of $22.8 million The 45% increase in ore placed on the heap leach pads in Q2 has created a large inventory of recoverable gold ounces. That supports increased production over the balance of the year. This has led the company to maintain its annual gold production guidance at 70 thousand to 75 thousand ounces of gold this year. With that, I will hand the call over to our COO, Clifford, to discuss the second quarter operating results for Florida Canyon.

Thanks, George. Turning to Slide 6, we have outlined the key operating metrics for Florida Canyon in the second quarter of 26. The second quarter showed strong operating results at Florida Canyon with a record mining rate of 87.9 thousand. Total tons per day achieved through the integration of new mining equipment into our existing mining fleet and shorter haul distances. In Q2 26, company mined 4.4 million tons of ore and 3.6 million tons of waste a strip ratio of 0.81 for the quarter. Average gold recovery was 57.8% in the quarter, in line with expectations. Florida Canyon produced 16.4 thousand ounces of gold in the quarter and sold 15.8 thousand ounces. Q2 2 thousand 26 mine-site AISC came in at $3.37 thousand per ounce sold. At the lower end of our revised guidance range. Reflecting increased rates of mining, hauling and stacking, cost pressures related to royalties and excise taxes, from stronger than anticipated gold prices, and higher diesel and explosive costs, Cash costs averaged $2.5 thousand per ounce sold for the quarter. During the quarter, we invested $13.5 million in sustaining capital, that reflects the company's continued reinvestment strategy at Florida Canyon. Spending year to date includes new equipment leases, capital stripping, and mobile equipment refurbishments. The company expects investments in sustaining capital expenditures to continue into the third quarter. The company also invested $800 thousand in non-sustaining capital this quarter, The non-sustaining capital spent this year was primarily directed toward equipment leases for the expanded fleet engineering and permitting work on Phase IIIc leach pad facility, and growth focused drilling programs at the Florida Canyon mine. Importantly, in the quarter, we released the results of our updated technical report and life of mine plan for Florida Canyon, which demonstrated a materially enhanced operation. Highlighting a substantial increase in mineral reserves an 8-year mine life, and increased annual production profile, lower operating costs, $600 million after-tax net present value, approximately $770 million in after-tax free cash flow over the life of the mine. Now I will hand the call back to George to discuss the updated life of mine plan at Florida Canyon.

Thanks, Clifford. When Integra acquired Florida Canyon in 2024 for approximately $68 million, We saw a producing mine with significant upside, but also with limited remaining mine life and a relatively flat production profile. We have studied and learned a lot about the mine in the last 18 months of ownership. The updated technical report and life of mine plan has been greatly informed by what we have learned about this mine thus far. In short, in less than 2 years since the acquisition of Florida Canyon, we have transformed the operation into a materially different mine. The technical report shows that Florida Canyon will generate more than 11x the original acquisition cost of $68 million in after tax free cash flow. Despite mining depletion, proven and probable reserves have increased by 74% from approximately 685 thousand ounces of gold to nearly 1.2 million ounces of gold. In addition, the mineral resource estimate has increased 128% in the oxide MNI category and 57% in the oxide inferred category. Mine life has been extended by 3 years and now has a total active mine life of 8 years plus 2 years of residual leaching. The annual gold production has increased by approximately 17% from roughly 70 thousand ounces to 82 thousand ounces. Of gold per year. This transformation reflects denser drilling geological refinement, engineering work, and operational improvements completed since the acquisition. The updated technical report demonstrates as substantially improved operation. Here are the highlights. Approximately 770 million in after tax free cash flow over the life of mine. This cash flow will be used to self support Florida Canyon and to fund growth elsewhere in the company. After-tax NPV of approximately $100 million using base case metal prices. 8 years of active mining with 2 years of residual leaching. Total payable gold production of 685 thousand ounces of gold. Life of mine AISC of approximately $2.33 thousand per ounce. Importantly, these economics are supported by a mine plan that we believe is both executable and sustainable moving forward. This graph demonstrates Florida Canyon strong after tax free cash flow. Which averages $99 million per year for total life of mine cumulative after tax free cash flow of approximately $770 million. This robust cash flow profile allows for the expansion highlighted in the updated life of mine plan at Florida Canyon to be self funded while supporting the DeLamar and Nevada North development project pipeline. Based on current estimates, we anticipate funding a portion of the DeLamar project preproduction capital expenditures with cash generated from Florida Canyon. Now I will hand the call back to Clifford to discuss our second quarter highlights at the DeLamar project.

Thank you, George. Turning to Slide 10. Delamar continues to advance through permitting towards a final environmental impact statement and record of decision in the second half of 27. On 05/29/2026, the US Bureau of Land Management published a notice of intent for Delamar in the federal register. Initiating the National Environmental Policy Act review process. A formal start of federal permitting. The associated public scoping and stakeholder engagement process included on 06/29/2026. And the Bureau of Land Management is reviewing comments received. In the second quarter of 26, we also announced that we engaged Ausenco to lead detailed engineering and procurement for the project. This work has begun and will continue through the first quarter of 27, with long lead procurement activities beginning in the second half of this year continuing through 27. On the ground at Delamar, the company has begun state of good-repair work which is focused on updating and derisking existing infrastructure and optimization projects like truck shop refurbishment, communications infrastructure installation, and crushing optimization analysis. We are also pleased to have entered into an agreement with the Shoshone Paiute tribes to collaboratively design and implement processes and initiatives that address their respective interests in the Delamar project. During the quarter, the company also advanced the Nevada North project. Which consists of the Wildcat deposit and the Mountain View deposit. Decision record documentation for the Wildcat exploration plan of operations, was complete as of 04/09/2026. And the reclamation permit for Nevada division of environmental protection bureau of mining regulation and Reclamation was received on 04/20/2026. With an effective date of 05/05/2026. The Wildcat exploration plan of operations will provide greater flexibility for significantly expanded exploration and hydrogeological drilling campaigns. Exploration drilling is scheduled to initiate in August 2026. I will now pass the call to our CFO, Andree, to provide an overview of the second quarter financial results.

Thanks, Clifford. Integra closed the second quarter of 26 with its strongest financial position to date. With a cash balance of $111 million and working capital of $147 million. With the exception of mobile equipment financing, the company has been debt free since December 2025. The company reported Q2 26 revenue of 70.8 million with a cost of sales of $47.4 million resulting in $23.4 million in mine operating earnings. This represents a 33% operating profit margin for the quarter. Operating cash flows of 22.8 million or $0.11 per share in Q2 26 which is a 40% increase compared to $16.3 million or $0.10 per share in Q2 25. Q2 26 adjusted earnings were $13.1 million or $0.06 per share comparable to $11.8 million or $0.07 per share in Q2 25. Free cash flow was $9.3 million or $0.05 per share for the quarter. A meaningful improvement from $2.1 million or $0.01 per share in Q2 25. I will now pass the call back to Clifford to walk through a revised 2026 guidance for Florida Canyon.

Thanks, Andree. Turning to slide 12. We are maintaining our 2026 gold production guidance for Florida Canyon. At 70 thousand to 75 thousand ounces. As announced on 06/25/2026, we revised our 2026 mine site all in sustaining cost guidance to $3.3 thousand to $3.5 thousand per ounce sold. As a result, our total cash cost guidance is increasing between 2.3 thousand to 25 hundred dollars per ounce sold. Non-sustaining growth capital guidance was revised to $16.5 to $18.5 million an increase of $9 million The revisions to total cash cost in mine-site AISC reflect higher tons mined, stacked, processed, lower gold ounces sold in the first half of the year, increased royalties and excise taxes tied to stronger gold prices, and high diesel and explosives costs. The non-sustaining capital increase reflects advancing heap leach pad construction into 2026 from 2027 in line with our updated Florida Canyon life of mine plan. Our revised guidance assumes a gold price of $4.2 thousand per ounce Royalties remain price sensitive with roughly $7 per ounce change. In cash cost and mine-site AISC for every $100 per ounce change in the gold price. I will now hand the call back to George to close out with our next steps and outlook.

Thanks, Clifford. Florida Canyon supports development across our pipeline portfolio, creating a clear path for Integra to become a multi asset U. S. Focused mid tier precious metals producer. For the balance of 2026, at Florida Canyon, we are accelerating construction of our heap leach expansion to accommodate the updated mine plan. At Delamar, state of good-repair work is underway to advance readiness while the NEPA permitting process continues. Across the portfolio, we expect 2 results from our 50 thousand-meter drilling campaign at all 3 projects. And we will work on advanced economic studies at Nevada North. Looking ahead to 2027, we expect permitting to continue at the Nevada North project along with an updated technical report and a record of decision and final environmental impact statement for DeLamar in the second half of the year. I would like to end the formal part of this presentation with slide 14. As it captures our strategy. Integra today is a fundamentally different company than it was just a few months ago. The updated Florida Canyon Life of Mine plan has established a larger longer life, and more profitable gold mining operation providing a stable cash generating foundation to fund the advancement of 1 of the highest quality gold development pipelines in the United States. Florida Canyon's cash flow will support Delamar as it progresses through federal permitting advanced economic studies at Nevada North. And the largest exploration program in the company's history to support future resource and reserve growth. We also maintain 1 of the largest gold and silver inventories in the Great Basin not controlled by a major gold mining company. We remain focused on disciplined execution responsible growth, and creating long term value. As we continue building a leading US focused intermediate gold producer. With that, I would like to thank everyone for joining us today and I will now turn the call back to the operator for questions.

Thank you. We will now begin the question and answer session. Your first question comes from the line of Heiko Ihle from H. C. Wainwright. Your line is open.

Hey there, guys. Thanks so much for taking my questions. Good morning. Clifford went through the cash cost guidance, the revised cash cost guidance for Florida Canyon. I know it is early and you probably do not necessarily want to give any real numbers. But can the team walk us through your expectations for the site in 2027 and beyond and what factors might sway cash and all in sustaining costs in the future to reach, you know, either side of a conceptually wide range given, you know, what just transpired.

Thank you. great question. And I think with respect to answering that question, I think the feasibility study that we put out should direct directly answers those questions. But I am going to pass it over to Clifford. he is got a more detailed sense of the evolution of our cost guidance, for that study. Clifford, over to you.

Thanks, George. Good question. I guess what I am-- I am worried about is making statements without having a technical report right in front of me. I do know that we are I think there was a question came up in the last call. We are making investments starting in 2027 in replacing the 777 fleet. Which will complete the upgrade of our fleet. So expect that in sustaining costs. The cash cost guidance went up this year because of the increase in tonnage. Stacked and treated on heap leach pads. That should start to calm down in 2027 as we access, the new mining area in the central pits. And the grades increase. I am not sure what more color I can add, but I know, like, over the next 3 to 4 years as the sustain capital, investments in the equipment and other infrastructures, like in the plant, making sure that some of the historic equipment there is upgraded. To improve its longevity and reliability. That we the cost to get back down to the $2.3 thousand to $2.4 thousand level as an all-in AISC?

1 thing and just a clarification. 1 thing that caught my ear in the report on the health, safety environment that you had a reportable spill It sounds like that is not a big deal because it was not an immediately reportable spill, which appears to be over 25 gallons of fuel depending on where you are. Just out of curiosity, what is there-- if something like this happens, they come to you for bigger bonds, reclamation bonds, or anything along those lines, or is that just something that happens and that is the end of it because nothing actually serious happened.

Thank you. I am going to direct that question to Greg Robinson, Robinson, our mine GM at Florida Canyon because he deals with those things directly. Greg, I think you are on the line.

Yes. I am. Yeah, good morning. that is a good morning. it is a good question. The threshold is actually they are different for process solution and hydrocarbons. The process solution is 25 gallons, I believe, for a quarterly reportable spill, which is what this was. And 100 gallons or more for an immediately reportable spill. This 1 was a pipeline leak that was near the process plant. On an old line, and it was it was a line that we replaced right afterwards and patched it up and moved on. Typically, we do not get a heightened response from the agencies if it is threatening other things or maybe ongoing, they might come out and visit and help us put a plan in place. But we typically do not see any enforcement action or anything unless it becomes a repeat serious offense and it is, you know, kind of highly subjective. it is not a black and white you hit this threshold and you get a automatic enforcement action. But in this case, it is something that was repairable, it was-- it was just a small pipeline leak that happens everywhere, and we were able to patch it up right away and move on.

So Fair enough. Perfect. I will get back into the queue. Thank you, guys. Thank you.

Your next question comes from the line of Joseph Reagor from ROTH Capital Partners. Your line is open.

Hey, guys. Thanks for taking the questions. Just kind of wanted to ask, I mean, given the market has kind of stabilized a bit now on the gold price front, Is there an opportunity for you guys to look for, you know, a development asset that is kind of plugged the gap between current production for Florida Canyon and DeLamar's permitting time line?

Yeah, Joe, thanks for the question. As we mentioned on other calls, we are always more-- we are we are constantly looking for M&A opportunities. Right? And the right-fit ones are kind of exactly what you just described. I think. That would be that would be a good 1 for us to pursue. That said, those types of opportunities are very rare, as you know, in the context of North America, which is kind of the hunting ground that we that we plan. Specifically the western U.S. there is just not a lot of assets that are kind of in production that meet that sweet spot that could fill in sort of the gap between what Florida Canyon is going to do next year and what DeLamar will do, say, 3 years out from today. So we are always on the hunt, but I have to say that those types of assets are rare. right now. I am sure you are hearing that from your other client companies as well.

Yeah. Fair. And then on the production front, are you still comfortable with the full year guidance? Given the slow start to the year.

Very much so. But again, I am going to address that question to Clifford. he is got the same level of high conviction as we all do with respect to our production guidance for the year. But Cliff, do you have any comments on that?

I do. Yeah. Good question. 1 of the enabling factors we have is because we did bring in the new trucks, through December and January and with the new shovel, we still have a significant portion of the triple 7 fleet that we were to start mothballing this year but we can keep those on the road. With the investments we made in the other part of the 777 fleet. Last year and into this year, the refurbishments we feel comfortable that we have the capacity to increase the, the tonnage rates and are watching it very closely and pleased with the results so far. Year to date. With the, the new mining rates with the fleet.

Okay. Good to hear. I will turn it over. Thanks, guys. Thank you.

Your next question comes from the line of Brian MacArthur from Raymond James.

Good morning. Thank you for taking my question. It really has to do with CapEx spending this year. With your updated guidance, when you did Q1, you sort of had $26 million but I think the feasibility study talk about $80 million for this year. But then when we talk about the tech report that talks about only doing $24 million year to date sustaining. I am just trying to figure out where we are in the CapEx spend this year and how much we expect in the back half of this year. And maybe even by quarter by quarter. I mean, I am sort of looking at it is probably another $45 million to go on the back half of the year, but that is what I am trying to reconcile between the financial statements.

Yeah. Thank you. I think a lot of the CapEx spend that you are referring to in the back half of this year, a lot of it is going to be guided towards the heap leach pad expansion that we really need to get going on this year. Right? So that is a big part of the cost coming up, stripping, obviously, to prepare us for production next year in 2027 when the production profile ramps up. But again, I am going to pass things back to Clifford in terms of maybe walking through our CapEx expenditure plans. The balance of the year and where they are focused.

it is a fair question. it is we are planning to achieve the spend that we committed to it is not going to be an easy feat, but we are planning to definitely, we will achieve the stripping that we have planned which is a big portion of that CapEx. We are on track with the Phase IIIc heap expansion, which we pulled from 2027 into 2026. Which took a lot of effort from our capital planning team, our project team at site, which had other, I think, smaller but it also important projects for improvement. Those are now gonna start to pick up in the latter half of the year. Now that we have got Phase IIIc underway. So you will start to see the CapEx pick up here to the end of the year.

Okay. that is just what I was trying to check. Right? Because we added the extra sustaining of about or nonsustaining about $9 million to $10 million we are bringing forward, but we are probably behind on the original run rate. So I am right in assuming that the back half assuming you hit your target, it is gonna be quite a bit heavier. that is correct. Right? Thank you very much. that is very helpful. Thank you.

And there are no further questions at this time. I will now turn the call back over to George Gregory Salamis for closing remarks.

Thank you very much. I have got no further closing remarks. Those are great questions, by the way, from the analysts. We really like it when our audience engages with us. I have got nothing else to say. Thank you all for attending the call today. Operator, I will turn it back to you.

This concludes today's conference call. Thank you for your participation. You may now disconnect.