Record 2025 results driven by price tailwinds and tight execution
Hochschild has posted its strongest ever financial performance. Revenue rose 25% to $1,182.1 million (pre-exceptional: $1,208.6 million), helped by a 37% jump in realised gold prices and 54% in silver. Adjusted EBITDA climbed 39% to $583.7 million, while profit before tax (post-exceptional) doubled to $372.8 million.
The balance sheet looks far healthier too. Cash ended the year at $317.0 million, net debt fell to just $22.7 million (net debt/EBITDA of 0.04x), and the Board has recommended a meaningfully higher final dividend of 5.00 US cents per share ($25.7 million), taking total 2025 dividends to $30.9 million.
| Key 2025 numbers | 2025 | 2024 |
|---|---|---|
| Revenue (reported) | $1,182.1 million | $947.7 million |
| Revenue (pre-exceptional) | $1,208.6 million | $947.7 million |
| Adjusted EBITDA | $583.7 million | $421.4 million |
| Profit before tax (post-exceptional) | $372.8 million | $177.2 million |
| Basic EPS (post-exceptional) | $0.39 | $0.19 |
| Cash | $317.0 million | $97.0 million |
| Net debt | $22.7 million | $215.6 million |
| Final dividend | 5.00 US cents/share | 1.94 US cents/share |
Operations: Inmaculada steady, San Jose resilient, Mara Rosa reboot on track
Total attributable production was 311,509 gold equivalent ounces (AuEq), down 10% year on year and in line with revised guidance.
- Inmaculada (Peru): 209,921 AuEq oz at AISC of $1,732/oz (2024: $1,479/oz). Lower grades as planned, offset by higher throughput.
- San Jose (Argentina, 51%): 120,639 AuEq oz at AISC of $2,520/oz (2024: $1,973/oz). Costs rose due to lower-grade areas, higher royalties/export taxes, and the removal of the blue-dollar export benefit in April 2025.
- Mara Rosa (Brazil): 40,062 AuEq oz at AISC of $3,697/oz (2024: $1,408/oz). A tough first half with heavy rain, contractor issues and filtration problems led to a one-month plant shutdown for maintenance. Performance improved through H2 as plant stability and access to higher-grade zones recovered.
Jargon buster:
- AuEq oz – gold equivalent ounces, converting silver into a gold-equivalent basis to compare assets.
- AISC – all-in sustaining cost, the industry’s broad measure of unit cost including sustaining capex.
Why profits jumped despite higher unit costs
The big driver was price. Average realised gold was $3,222/oz (+37%) and silver $44.2/oz (+54%). That more than offset lower volumes and higher costs. Group AISC rose to $2,138/oz (2024: $1,558/oz), reflecting Mara Rosa’s reset, San Jose’s grade profile and cyclical cost items tied to higher prices, such as royalties, export taxes and workers’ profit sharing.
Hedging was a headwind. The company booked an $86.1 million loss from 2025 gold hedges and recognised a non-cash $26.4 million exceptional charge related to rolling a portion of forward hedge contracts to 2028. Derivative liabilities also increased on balance sheet revaluations. None of this changes the cash received from selling metal at spot during the year, but it is worth tracking into 2026.
Balance sheet strength and a bigger dividend
Free cash generation at elevated metal prices, plus the Tiernan Gold transaction proceeds, helped cut net debt by almost $200 million to $22.7 million. With liquidity strengthened and net leverage close to zero, the Board is leaning into its dividend policy: final dividend of 5.00 US cents per share ($25.7 million), taking 2025 total dividends to $30.9 million.
Growth pipeline: Monte do Carmo, Royropata and resource additions
- Monte do Carmo (Brazil): Detailed engineering nearing completion; installation licence awarded; stream buy-down executed for $13.0 million; updated economics and a final investment decision targeted for mid-2026.
- Royropata (Peru): Permitting on track with the Modified Environmental Impact Assessment slated for submission after Peru’s national elections in Q3 2026.
- Brownfield success: 1.7 million AuEq ounces added to resources in 2025, with notable additions at Inmaculada and Royropata.
- Portfolio optimisation: Tiernan Gold Corp listed on the TSX-V, raising approximately $30 million; Hochschild received about $12 million from the secondary offering and retains a 69.8% stake.
2026 outlook: production, costs and capital
Guidance points to a steady year with improving contribution from Brazil.
- Attributable production: 300,000-328,000 AuEq oz.
- Unit costs: AISC of $2,157-$2,320/oz.
- Mine-level split: Inmaculada 174,000-185,000 AuEq oz; San Jose 59,000-63,000 AuEq oz; Mara Rosa 67,000-80,000 oz.
- Capital: Sustaining capex at operating mines of c.$210-225 million; brownfield exploration budget of $45 million.
Note: AISC is expected a touch higher year on year, mainly due to lower grades at Inmaculada and tailings expansion capex, partly offset by better volumes at Mara Rosa and expected currency devaluation support in Argentina.
ESG: safety, water and waste metrics moved the right way
- Lost Time Injury Frequency Rate: 0.97 (2024: 1.25).
- Fresh water used: 0.26 m³/tonne (2024: 0.31 m³/tonne).
- Recycled waste: 81.4% (2024: 57.3%).
- Local workforce: 65.9% (2024: 59.3%). Women: 10.6% (2024: 10.0%).
- ECO score: 5.61/6 (2024: 5.58).
What I think this means for investors
The good news
- Cash engine purring: With spot prices hitting records late in the year, revenue and EBITDA hit all-time highs. Cash up, net debt down, and dividend up materially.
- Inmaculada remains the backbone: Consistent output and a large resource base underpin medium-term visibility.
- Brazil getting back on the front foot: Mara Rosa’s operational reset showed clear H2 improvement, and Monte do Carmo is approaching decision point with permitting substantially de-risked.
- Exploration is doing the heavy lifting: 1.7 million AuEq ounces added is a strong result that supports mine lives and optionality.
The watch-outs
- Unit costs are elevated: Group AISC rose to $2,138/oz, with San Jose and Mara Rosa both high. 2026 guidance implies AISC stays above $2,150/oz, so pricing remains a key support.
- Hedge overhang and taxes: Realised hedge losses and larger derivative liabilities were a drag in 2025; Argentina’s tax/export regime and price-linked royalties will keep costs sensitive to macro moves.
- Execution in Brazil: The H2 recovery at Mara Rosa is encouraging, but 2026 delivery is important ahead of Monte do Carmo’s final investment decision.
Bottom line
Hochschild has used the strongest metal price backdrop in years to reset its balance sheet, fund exploration and lift shareholder returns. The strategic pieces are lining up – a stabilising Brazil business, a flagship in Peru, a growing project pipeline – but the company is still cost-sensitive and exposed to regulatory and hedging effects. If the team delivers on 2026 guidance and advances Monte do Carmo on time, today’s stronger foundation should translate into more resilient free cash flow through the cycle.
