Metals Exploration Reports Record H1 2025 Cash Flow and Advances La India Project

Record H1 2025 cash flow and rapid progress at La India

Metals Exploration PLC has delivered a punchy first half. Despite slightly lower gold output at Runruno, record free cash flow and a red-hot gold price did the heavy lifting. The Condor Gold acquisition is already translating into action on the ground in Nicaragua, with an aggressive build programme under way at La India and a first gold pour targeted by Q4 2026.

Below I unpack the numbers, the operational colour, and what it all means for investors.

Key H1 2025 numbers at a glance

Metric	H1 2025	H1 2024
Revenue	US$118.9 million	US$91.1 million
Gold sold	41,240 oz	41,589 oz
Average realised gold price	US$2,884/oz	US$2,190/oz
Gold produced	40,985 oz	42,535 oz
Recovery rate	91.4%	89.6%
EBITDA (incl. impairment and share-based charges)	US$72.3 million	US$47.2 million
Free cash flow	US$70.7 million	US$46.4 million
Profit after tax	US$16.5 million	US$58.5 million
Cash and cash equivalents (30 June)	US$45.9 million	US$6.6 million
Net assets (30 June)	US$235.2 million	US$191.7 million

Quick jargon check: free cash flow is the cash left after operating and capital spending – it is the money that pays down debt, builds projects, or returns to shareholders. EBITDA is a proxy for operating cash generation before non-cash items like depreciation.

Runruno operations: steady output, higher recoveries, and a post-period pause

Runruno produced 40,985 oz, a touch below last year, but with stronger recoveries at 91.4%. Throughput was 1.04Mt at an unchanged head grade of 1.34 g/t. Gold sales of 41,240 oz at US$2,884/oz drove the revenue step-up.

Two operational points matter. First, management expects H2 recoveries to dip as more oxide ore is processed from Stages 5 and 6. Second, after the period end, ore processing was paused for around six weeks to implement new procedures following outside cyanide contamination of the BIOX circuit attributed to illegal miners. Guidance for FY2025 is unchanged at 70,000 – 75,000 oz, but skewed to the lower end.

The mine plan remains clear: mining at Runruno is expected to cease in Q4 2026. That timing pairs neatly with the La India development schedule.

La India build: contracts awarded, plant on site, earthworks 30% complete

The Condor Gold deal closed on 15 January 2025 and Metals Exploration has moved quickly in Nicaragua. Most major construction contracts have been awarded, a Spanish-speaking leadership team hired, and community engagement strengthened. Crucially, the company bought the Rock Creek processing plant – it has arrived in Nicaragua and is due to move to site in September. That should cut lead times and capex uncertainty.

On-site progress includes geo-technical and infill drilling (2,274 metres completed by 30 June), bulk earthworks 30% complete, and construction of the camp and support buildings under way. La India was previously outlined by Condor as a 2.2 Moz gold resource. Metals Exploration plans a minimum 40,000 metre drill programme over five years to test resource growth and district-scale potential.

Important deal term: Condor shareholders hold a Contingent Value Right. Metals Exploration has recognised a US$14.4 million liability for a cash payment due on first gold doré pour from a fully commissioned plant. A second CVR of up to US$14.4 million is contingent on new resources above 3.158 Moz and is treated as a contingent liability.

Exploration pipeline in the Philippines: Dupax and Abra

Momentum is not just in Nicaragua. The company received the Dupax exploration licence, 20 km from Runruno, covering roughly 3,100 hectares. An IP survey and a circa 2,500 metre drill programme have commenced. A discovery here could extend processing operations at Runruno beyond the current mine life.

At Abra, three copper and copper-gold targets are lined up for drilling, expected to start in Q1 2026 following completion of community consultations with the National Commission for Indigenous Peoples.

Profit versus cash: why earnings fell while cash surged

Profitability headlines can mislead. Profit after tax fell to US$16.5 million from US$58.5 million. The comparator includes a large impairment reversal in H1 2024 (US$49.7 million). This year also includes a sizeable share-based payment expense of US$17.7 million tied to the LTIP options exercised after vesting hurdles were met. Strip those accounting items out and the cash story shines through: operating cash flow was US$59.6 million and free cash flow a record US$70.7 million.

Balance sheet: debt free, cash rich, and building

Metals Exploration repaid a short-term £5.5 million shareholder loan by transferring 94,127,854 treasury shares at 6p per share. The group is now debt free. Cash rose to US$45.9 million at 30 June, with net assets at US$235.2 million. The balance sheet also reflects the Condor acquisition, including mineral properties and the US$14.4 million CVR liability.

Capital allocation is straightforward: keep Runruno humming, complete the La India build, and advance near-mine exploration. With the Rock Creek plant secured and contracts awarded, visibility on La India delivery has improved.

Operational risks and how to think about them

• Processing interruption at Runruno: the six-week pause was post-period and linked to illegal miner cyanide contamination. Guidance still stands, albeit towards the lower end of 70,000 – 75,000 oz for FY2025. I see execution risk but commend swift remediation and transparency.
• Recovery variability: H2 recoveries are expected to ease due to ore characteristics. That is flagged and factored into guidance.
• Project delivery: La India’s schedule assumes orderly logistics and permitting. The arrival of the plant and early contract awards de-risk timelines, in my view.
• Commodity price: H1 benefited from US$2,884/oz realised price. A weaker gold price would bite cash generation.

Why this update matters for investors

Two takeaways. First, the business is throwing off cash at today’s gold price while remaining debt free. That gives Metals Exploration room to fund development without leaning on shareholders. Second, La India is moving from concept to construction. If first pour lands by Q4 2026, it should dovetail with the planned wind-down of mining at Runruno, smoothing the group’s production profile.

There are moving parts – H2 recoveries, the recent processing pause, and the usual project build risks – but the direction of travel is positive. I’ll be watching for continued La India construction milestones, Dupax drill results, and confirmation that FY2025 production lands within guidance.

Further information

The full interim results and sustainability materials are available on the company’s website: www.metalsexploration.com.