Andean Precious Metals Corp (ANPMF) (Q3 2026) Earnings Call Highlights: Record Revenue and …

This article first appeared on GuruFocus.

Release Date: November 11, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Andean Precious Metals Corp (ANPMF) achieved record quarterly revenue of $196.6 million, up 117% year-over-year, driven by higher realized gold and silver prices and increased sales volumes.

• The company generated strong free cash flow of $69.8 million in Q3 2026, compared to $12.4 million in Q3 2025, significantly strengthening its financial position.

• Andean Precious Metals Corp (ANPMF) maintains a solid balance sheet with $195.8 million in liquid assets, including $93.7 million in cash, providing financial flexibility.

• Consolidated production increased 6% year-over-year to 27,262 gold equivalent ounces, with both San Bartolome and Golden Queen contributing to the growth.

• The company repurchased approximately 2.35 million shares in Q3 2026 for $14.5 million Canadian dollars, demonstrating a commitment to returning capital to shareholders.

Negative Points

• Andean Precious Metals Corp (ANPMF) revised its 2026 consolidated production guidance downward to 101,000-109,000 gold equivalent ounces from the original 100,000-114,000 range, due to lower expected gold production at Golden Queen.

• Golden Queen’s all-in sustaining costs (AISC) increased to $2,216 per gold ounce in Q3 2026 from $1,682 in Q3 2025, driven by higher diesel prices and increased mining-related costs.

• San Bartolome’s gross margin ratio declined to 28.6% in Q3 2026 from 43.8% in the prior year period, as higher silver prices increased purchase ore costs, pressuring percentage margins.

• The company faces significant cost pressures from a flexible Bolivian exchange rate, with the boliviano averaging 11.58 to the dollar in Q3 2026 versus original guidance of 9, impacting costs.

• Andean Precious Metals Corp (ANPMF) deferred certain capital expenditures, including the Golden Queen heap leach pad expansion and Merrill Crowe plant upgrade, which may impact future production and require higher spending in 2027.

Q & A Highlights

Q: On Golden Queen’s deferred spending and the Merrill Crowe plant review, should investors still expect heap leach pad expansion spending to pick up next year ahead of the technical report? A: Victor Flores (SVP, Exploration Operations and Growth) confirmed that the heap leach pad expansion should definitely be modeled as a capital cost for next year. Contractor bids are expected within weeks, a contractor will be selected, and construction is planned to begin early in the new year.

Q: Aside from the heap leach pad expansion, are there other major capital items at Golden Queen that will require spending next year? A: Victor Flores (SVP, Exploration Operations and Growth) said the leach pad expansion will fall squarely in the first half of 2027. The Merrill Crowe plant upgrade was deferred because more work is needed, and management cannot yet say whether it will proceed or what it will cost. Other equipment purchases deferred from this year could also occur next year. More detail will come with 2027 guidance once budgeting is complete and the technical report is released.

Q: San Bartolome’s gross margin ratio was only 28% this quarter versus 35% year to datehow do the ore purchase contracts work, and should investors expect a rebound toward the 35% level in Q4? A: Alberto Morales (Executive Chairman and CEO) explained that the purchase-to-sale cycle runs 60 to 75 days, so falling spot silver prices between ore purchase and metal sale compress margins, while rising prices expand them. The effect averages out over a year, which is why the 35%45% gross margin ratio guidance is maintained. Juan Carlos Sandoval (CFO) added that higher diesel prices and the Boliviano’s move from about 9 to 12 per US dollar also pressured margins, but the 35%45% guidance is reaffirmed.

Q: What is driving higher unit costs at Golden Queen, and how should investors think about costs into 2027? A: Juan Carlos Sandoval (CFO) said diesel prices in California are among the highest in the country and are the most important cost driver. Victor Flores (SVP, Exploration Operations and Growth) added that diesel prices have almost doubled, and energy-linked inputs such as explosives (fuel oil and ammonium nitrate), cyanide, and tariffed overseas inputs have also risena “perfect storm” for the industry.

Q: What drilling will be included in the Golden Queen resource estimate in the upcoming technical report? A: Victor Flores (SVP, Exploration Operations and Growth) said very few holes from the 2026 program made it into the modellikely countable on one handso the update is really based on 2024 and 2025 drilling.

Q: San Bartolome’s recoveries dipped in Q3is that a new ore blend or something to expect going forward? A: Victor Flores (SVP, Exploration Operations and Growth) characterized the dip as run-of-the-mill quarterly variability from processing ore from different sources, not a systemic issue. Ongoing work is underway to improve plant recoveries, and the thickener coming in Q1 should also support recoveries, though he would not advise raising recovery assumptions in models.

Q: With the NCIB roughly 3 million shares into a 4 million share authorization, is there an opportunity to expand or replace the buyback ahead of its July 2027 expiry? A: Juan Carlos Sandoval (CFO) said the company has approval for up to 4 million shares and has repurchased a little over 2 million so far. Management will selectively continue the plan when it believes the stock price is undervalued.

Q: What drove the large reduction in Golden Queen capital expenditure guidance for this year, and how should investors gauge next year’s spending? A: Victor Flores (SVP, Exploration Operations and Growth) attributed the cut mainly to deferring the leach pad expansion into 2027 and pausing the Merrill Crowe plant upgrade pending further work, plus some equipment purchases slipping. He said 2027 guidance will come after the budget process and technical report, which will provide much more color.

Q: How did the sale of deferred inventory affect Q3 results, and is the resulting cash flow a sustainable run rate? A: Juan Carlos Sandoval (CFO) said approximately 732,000 ounces of silver and 2,600 ounces of gold held at June 30 were sold early in Q3 at average realized prices of $62.26 per silver ounce and $4,168 per gold ounce, generating about $56.3 million in gross proceeds against a $37.6 million carrying cost. He stressed this timing benefit should not be treated as a normalized quarterly operating cash flow run rate.

Q: What is the outlook for consolidated production and capital expenditure guidance for 2026? A: Alberto Morales (Executive Chairman and CEO) said consolidated production guidance was narrowed to 101,000109,000 gold equivalent ounces within the original range, as higher expected silver production at San Bartolome offsets lower expected gold output at Golden Queen. Consolidated capex guidance was roughly halved to $17 million$28 million to prioritize capital and defer certain growth expenditures while preserving financial flexibility.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.