Mexico-focused precious metals miner Fresnillo has reported a 74.7% year-on-year increase in revenue to $3.38-billion for the six months ended June 30, mainly owing to higher silver and gold prices and partially offset by an anticipated decrease in gold and silver ounces sold.
“Fresnillo delivered an exceptional financial performance in the first half of 2026,” says CEO Octavio Alvídrez.
He adds that the company’s financial position enabled it to fund the strategic acquisition of Probe Gold, ongoing capital expenditure (capex) requirements, investment in exploration and to declare an increased interim dividend of $0.43 a share for the period, in accordance with the company’s dividend policy, while maintaining a robust balance sheet.
The company says the average realised silver price increased by 134.4% year-on-year to $78.90/oz in the first half of this year, while the average realised gold price rose by 47.3% year-on-year to $4 666.80/oz.
The average realised lead by-product price decreased to $0.87/lb, down 2.3% year-on-year, while the average realised zinc by-product price increased by 27% year-on-year to $1.55/lb.
Adjusted production costs increased by 20.5% year-on-year to $811.9-million, primarily owing to a 12.5% revaluation of the Mexican peso against the dollar; cost inflation; higher maintenance costs at the Saucito operation; higher stripping and longer haulage distances at Herradura, together with higher contractor costs associated with the temporary hauling of material while the two sections of the Jarillas shaft at Saucito are being interconnected.
Depreciation decreased by 11%, primarily owing to lower production at Herradura and the lower depletion factor at the Fresnillo and Ciénega mines, driven by the increase in reserves.
Fresnillo says these factors resulted in a 12% increase in cost of sales compared with the first half of 2025.
The increase in revenues, together with the increase in cost of sales, resulted in a 130.7% increase in gross profit to $2.36-billion for the six months ended June 30.
Driven by an increase in gross profit, earnings before interest, taxes, depreciation and amortisation (Ebitda) increased by 113.2%, with Ebitda margin rising from 56.9% in the first half of 2025 to 69.5% in the first half of this year.
Similarly, the company notes, profit from continuing operations before net finance costs and income tax increased from $860.8-million in the first half of 2025 to $2.14-billion in the period under review.
Profit from continuing operations before income tax increased by 227.6% from $660.3-million in the first half of 2025 to $2.16-billion in the first half of this year.
Profit for the period increased from $467.6-million in the first half of 2025 to $1.46-billion in the first half of 2026, a 213% increase year-on-year.
Cash generated by operations before changes in working capital increased by 114.3% to $2.36-billion, mainly as a result of the higher profit from continuing operations generated in the year.
Capex in the period under review totalled $236.2-million, a 49.6% year-on-year increase.
OPERATIONS
Meanwhile, Fresnillo reports that attributable silver production of 22-million ounces (including Silverstream) for the six months under review was 11.4% lower year-on-year, mainly owing to the end of the contribution from Silverstream, the lower ore grade and decrease in volume of ore processed at Saucito, the lower ore grade at Juanicipio, Fresnillo and San Julián Veins and the lower ore grade and recovery rate and decreased volume of ore processed at Ciénega.
Attributable gold production decreased by 7.3% year-on-year to 290 900 oz, owing to the lower ore grade at Herradura resulting from reduced volumes of high-grade ore processed at the Dynamic Leaching Plant I, owing to a fissure in the ball mill.
To a lesser extent, the company says the decrease in volumes of ore processed at Herradura, driven by a minor delay in the commissioning of the leaching pad XV, and heavy rain and fog at the beginning of the year, also contributed to the lower gold production.
Additionally, attributable by-product lead production increased by 8.8% year-on-year, mainly owing to the higher ore grade at Fresnillo and Juanicipio, and partially offset by the lower ore grade at Saucito.
Attributable by-product zinc production remained broadly stable.
“Operationally, gold and silver production was in line with our expectations and plans across our mines are progressing well. We saw year-on-year changes from lower grades, a minor delay in the commissioning of the leaching pad XV at Herradura and weather-related disruptions.
“We remain focused on managing costs within our control by driving efficiencies across our supply chain and advancing key infrastructure projects, including the interconnection of the Jarillas shaft at Saucito,” says Alvídrez.
OUTLOOK
Fresnillo says its full-year 2026 outlook remains in line with previous guidance.
Attributable silver production is expected to be between 42-million and 46.5-million ounces, while attributable gold production is expected to be between 500 000 oz and 550 000 oz.
Attributable lead production is expected to be between 54 000 t and 59 000 t and attributable zinc production between 85 000 t and 95 000 t.
Expressed in silver-equivalent ounces, total production is expected to be between 82-million and 91-million ounces for the full-year.
Exploration expenses for 2026 are expected to be about $260-million and risk capital invested in exploration anticipated to be about $308-million.
Capex for 2026 has been revised to between $500-million and $550-million, reflecting the rationalisation of capex across mining operations.
“Our full-year production guidance remains unchanged and our high-margin portfolio puts us in a strong position to capitalise on ongoing market tailwinds. The safety and wellbeing of our people and host communities remain our core priority as we deliver on our strategy for the remainder of 2026,” says Alvídrez.