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Fortuna Mining Corp. Interim / Quarterly Report 2025
43939_rns_2025-05-07_b0760739-d05b-479b-9cca-3ecf348c3ba9.pdf
Interim / Quarterly Report
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Fortuna
Mining
CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
For the three months ended
March 31, 2025 and 2024
(UNAUDITED)
Fortuna Mining Corp.
Condensed Interim Consolidated Statements of Income
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
| Note | Three months ended March 31, | ||
|---|---|---|---|
| 2025 | 2024 (1) | ||
| $ | $ | ||
| Sales | 18 | 290,145 | 200,905 |
| Cost of sales | 19 | 174,271 | 131,316 |
| Mine operating income | 115,874 | 69,589 | |
| General and administration | 20 | 25,296 | 16,772 |
| Foreign exchange (gain) loss | (2,063) | 3,961 | |
| Other expenses | 778 | 531 | |
| 24,011 | 21,264 | ||
| Operating income | 91,863 | 48,325 | |
| Investment gains | 4 | 1,319 | 2,648 |
| Interest and finance costs, net | 21 | (3,028) | (6,023) |
| Gain on derivatives | 53 | - | |
| (1,656) | (3,375) | ||
| Income before income taxes | 90,207 | 44,950 | |
| Income taxes | |||
| Current income tax expense | 30,561 | 16,345 | |
| Deferred income tax recovery | (8,328) | (951) | |
| 22,233 | 15,394 | ||
| Net income from continuing operations | 67,974 | 29,556 | |
| Net loss from discontinued operation, net of tax | 22 | (3,166) | (489) |
| Net income | 64,808 | 29,067 | |
| Net income attributable to: | |||
| Fortuna shareholders | 58,503 | 26,250 | |
| Non-controlling interests | 26 | 6,305 | 2,817 |
| 64,808 | 29,067 | ||
| Earnings per share from continuing operations attributable to Fortuna shareholders | 17 | ||
| Basic | 0.20 | 0.09 | |
| Diluted | 0.20 | 0.09 | |
| Earnings per share attributable to Fortuna shareholders | 17 | ||
| Basic | 0.19 | 0.09 | |
| Diluted | 0.19 | 0.09 | |
| Weighted average number of common shares outstanding (000's) | |||
| Basic | 306,614 | 306,470 | |
| Diluted | 308,065 | 308,199 |
(1) Comparative information has been restated due to a discontinued operation (Note 22).
The accompanying notes are an integral part of these interim financial statements.
Page | 1
Fortuna Mining Corp.
Condensed Interim Consolidated Statements of Comprehensive Income
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
| Note | Three months ended March 31, | |
|---|---|---|
| 2025 | 2024 | |
| Net income | 64,808 | 29,067 |
| Items that will remain permanently in other comprehensive income (loss): | ||
| Changes in fair value of investments in equity securities, net of $nil tax | (51) | 28 |
| Items that may in the future be reclassified to profit or loss: | ||
| Currency translation adjustment, net of tax (1) | 749 | (1,154) |
| Total other comprehensive income (loss) | 698 | (1,126) |
| Comprehensive income | 65,506 | 27,941 |
| Comprehensive income attributable to: | ||
| Fortuna shareholders | 59,201 | 25,124 |
| Non-controlling interests | 26 | 6,305 |
| 65,506 | 27,941 |
(1) For the three months ended March 31, 2025, the currency translation adjustment is net of tax recovery of $46 thousand (2024 - expense of $41 thousand).
The accompanying notes are an integral part of these interim financial statements.
Page | 2
Fortuna Mining Corp.
Condensed Interim Consolidated Statements of Financial Position
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
| Balance at | Note | March 31, 2025 $ | December 31, 2024 $ |
|---|---|---|---|
| ASSETS | |||
| CURRENT ASSETS | |||
| Cash and cash equivalents | 305,048 | 231,328 | |
| Short-term investments | 4,355 | - | |
| Trade and other receivables | 4 | 95,903 | 99,984 |
| Inventories | 5 | 135,906 | 134,496 |
| Other current assets | 6 | 12,419 | 20,433 |
| Assets held for sale | 22 | 23,764 | - |
| 577,395 | 486,241 | ||
| NON-CURRENT ASSETS | |||
| Mineral properties and property, plant and equipment | 7 | 1,516,324 | 1,539,187 |
| Other non-current assets | 8 | 92,841 | 90,104 |
| Total assets | 2,186,560 | 2,115,532 | |
| LIABILITIES | |||
| CURRENT LIABILITIES | |||
| Trade and other payables | 9 | 146,845 | 151,642 |
| Income taxes payable | 98,187 | 80,116 | |
| Current portion of lease obligations | 11 | 20,534 | 19,761 |
| Current portion of closure and reclamation provisions | 14 | 353 | 4,510 |
| Liabilities directly associated with assets held for sale | 22 | 17,320 | - |
| 283,239 | 256,029 | ||
| NON-CURRENT LIABILITIES | |||
| Debt | 12 | 127,988 | 126,031 |
| Deferred tax liabilities | 136,071 | 144,266 | |
| Closure and reclamation provisions | 14 | 58,875 | 70,827 |
| Lease obligations | 11 | 49,353 | 48,216 |
| Other non-current liabilities | 13 | 2,312 | 4,090 |
| Total liabilities | 657,838 | 649,459 | |
| SHAREHOLDERS’ EQUITY | |||
| Share capital | 16 | 1,128,838 | 1,129,709 |
| Reserves | 56,484 | 57,772 | |
| Retained earnings | 274,887 | 216,384 | |
| Equity attributable to Fortuna shareholders | 1,460,209 | 1,403,865 | |
| Equity attributable to non-controlling interests | 26 | 68,513 | 62,208 |
| Total equity | 1,528,722 | 1,466,073 | |
| Total liabilities and shareholders’ equity | 2,186,560 | 2,115,532 |
Contingencies and Capital Commitments (Note 27)
Subsequent Events (Notes 16 and 28)
The accompanying notes are an integral part of these interim financial statements.
/s/ Jorge Ganoza Durant
/s/ Kylie Dickson
Jorge Ganoza Durant
Kylie Dickson
Director
Director
Page | 3
Fortuna Mining Corp.
Condensed Interim Consolidated Statements of Cash Flows
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
| Note | Three months ended March 31, | ||
|---|---|---|---|
| 2025 | 2024 | ||
| $ | $ | ||
| Operating activities: | |||
| Net income | 64,808 | 29,067 | |
| Items not involving cash: | |||
| Depletion and depreciation | 61,687 | 50,255 | |
| Accretion expense | 21 | 2,343 | 2,114 |
| Income taxes | 22,233 | 14,498 | |
| Interest expense, net | 21 | 1,010 | 4,104 |
| Share-based payments, net of cash settlements | 2,623 | 42 | |
| Unrealized foreign exchange loss (gain) | (3,546) | (3,719) | |
| Investment gains | 4 | (1,319) | (2,648) |
| Other | 1,650 | (446) | |
| Closure, reclamation and related severance payments | 14 | (5,738) | (86) |
| Changes in working capital | 25 | (11,681) | (35,327) |
| Cash provided by operating activities | 134,070 | 57,854 | |
| Income taxes paid | (10,504) | (5,891) | |
| Interest paid | (648) | (3,864) | |
| Interest received | 3,461 | 849 | |
| Net cash provided by operating activities | 126,379 | 48,948 | |
| Investing activities: | |||
| Additions to mineral properties and property, plant and equipment | 7 | (39,559) | (41,341) |
| Purchases of investments | 4 | (14,376) | (7,613) |
| Proceeds from sale of investments | 4 | 11,352 | 10,261 |
| Receipts (deposits) on long-term assets | 2,326 | (1,304) | |
| Other investing activities | (232) | 494 | |
| Cash used in investing activities | (40,489) | (39,503) | |
| Financing activities: | |||
| Transaction costs on credit facility | 12 | (107) | - |
| Repayment of credit facility | 12 | - | (40,000) |
| Repurchase of common shares | 16 | (4,165) | (3,535) |
| Payments of lease obligations | 25 | (6,001) | (4,934) |
| Cash used in financing activities | (10,273) | (48,469) | |
| Effect of exchange rate changes on cash and cash equivalents | 1,163 | (1,399) | |
| Increase in cash and cash equivalents during the period | 76,780 | (40,423) | |
| Cash and cash equivalents, beginning of the period | 231,328 | 128,148 | |
| Cash and cash equivalents used in discontinued operation, net | 22 | (3,060) | - |
| Cash and cash equivalents, end of the period | 305,048 | 87,725 | |
| Cash and cash equivalents consist of: | |||
| Cash | 270,316 | 75,445 | |
| Cash equivalents | 34,732 | 12,280 | |
| Cash and cash equivalents, end of the period | 305,048 | 87,725 |
These condensed interim consolidated statements of cash flows include cash flows from both continuing and discontinued operations. Segment totals for the discontinued operation are disclosed in Note 22.
Supplemental cash flow information (Note 25).
The accompanying notes are an integral part of these interim financial statements.
Page | 4
Fortuna Mining Corp.
Condensed Interim Consolidated Statements of Changes in Equity
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
| Note | Share capital | Reserves | Retained earnings $ | Non-controlling interests $ | Total equity $ | ||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Number of common shares | Amount $ | Equity reserve $ | Hedging reserve $ | Fair value reserve $ | Equity component of convertible debt $ | Foreign currency reserve $ | |||||
| Balance at January 1, 2025 | 306,928,189 | 1,129,709 | 26,701 | 198 | (875) | 37,050 | (5,302) | 216,384 | 62,208 | 1,466,073 | |
| Total comprehensive income | |||||||||||
| Net income | - | - | - | - | - | - | - | 58,503 | 6,305 | 64,808 | |
| Other comprehensive income | - | - | - | - | (51) | - | 749 | - | - | 698 | |
| Total comprehensive income | - | - | - | - | (51) | - | 749 | 58,503 | 6,305 | 65,506 | |
| Transactions with owners of the Company | |||||||||||
| Repurchase of common shares | 16 | (916,900) | (4,165) | - | - | - | - | - | - | - | (4,165) |
| Shares issued on vesting of share units | 948,697 | 3,294 | (3,294) | - | - | - | - | - | - | - | |
| Share-based payments | 15 | - | - | 1,308 | - | - | - | - | - | - | 1,308 |
| 31,797 | (871) | (1,986) | - | - | - | - | - | - | (2,857) | ||
| Balance at March 31, 2025 | 306,959,986 | 1,128,838 | 24,715 | 198 | (926) | 37,050 | (4,553) | 274,887 | 68,513 | 1,528,722 | |
| Balance at January 1, 2024 | 306,587,630 | 1,125,376 | 26,144 | 198 | (998) | 4,825 | (4,827) | 87,649 | 49,754 | 1,288,121 | |
| Total comprehensive income | |||||||||||
| Net income | - | - | - | - | - | - | - | 26,250 | 2,817 | 29,067 | |
| Other comprehensive loss | - | - | - | - | 28 | - | (1,154) | - | - | (1,126) | |
| Total comprehensive income | - | - | - | - | 28 | - | (1,154) | 26,250 | 2,817 | 27,941 | |
| Transactions with owners of the Company | |||||||||||
| Repurchase of common shares | 16 | (1,030,375) | (3,535) | - | - | - | - | - | - | - | (3,535) |
| Shares issued on vesting of share units | 186,784 | 681 | (681) | - | - | - | - | - | - | - | |
| Share-based payments | 15 | - | - | 890 | - | - | - | - | - | - | 890 |
| (843,591) | (2,854) | 209 | - | - | - | - | - | - | (2,645) | ||
| Balance at March 31, 2024 | 305,744,039 | 1,122,522 | 26,353 | 198 | (970) | 4,825 | (5,981) | 113,899 | 52,571 | 1,313,417 |
The accompanying notes are an integral part of these interim financial statements.
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
1. NATURE OF OPERATIONS
Fortuna Mining Corp. (the "Company"), is a publicly traded company incorporated and domiciled in British Columbia, Canada.
The Company is engaged in precious and base metal mining and related activities in Argentina, Burkina Faso, Côte d'Ivoire, Mexico, Peru and Senegal. The Company operates the open pit Lindero gold mine ("Lindero") in northern Argentina, the open pit Séguéla gold mine ("Séguéla") in southwestern Côte d'Ivoire, the underground Caylloma silver, lead, and zinc mine ("Caylloma") in southern Peru, and the underground and open pit Yaramoko gold mine ("Yaramoko") in southwestern Burkina Faso, and is developing the Diamba Sud gold project in Senegal. Subsequent to March 31, 2025, the Company entered into a definitive share purchase agreement to sell its 100% interest in Roxgold SANU S.A., which owns and operates the Yaramoko mine. The sale is expected to be completed in the second quarter of 2025 (see Note 28). Additionally, on April 11, 2025, the Company completed the sale of its 100% interest in Compania Minera Cuzcatlan S.A. de C.V. ("Cuzcatlan"), which owns the San Jose mine (see Note 28).
The Company's common shares are listed on the New York Stock Exchange (the "NYSE") under the trading symbol FSM and on the Toronto Stock Exchange (the "TSX") under the trading symbol FVI.
In January 2025, the Company relocated its head office to Suite 820, 1111 Melville Street, Vancouver, British Columbia V6E 3V6, Canada. As at March 31, 2025, the Company's registered office was located at Suite 3500, 1133 Melville Street, Vancouver, British Columbia V6E 4E5, Canada.
2. BASIS OF PRESENTATION
Statement of Compliance
These unaudited condensed interim consolidated financial statements ("interim financial statements") have been prepared by management of the Company in accordance with International Financial Reporting Standards ("IFRS") as issued by the International Accounting Standards Board ("IASB") applicable to the preparation of interim financial statements, including IAS 34 Interim Financial Reporting. They do not include all the information required for full annual financial statements. These interim financial statements should be read in conjunction with the Company's audited consolidated financial statements for the year ended December 31, 2024, which include information necessary for understanding the Company's business and financial presentation.
Other than as described below, the same accounting policies and methods of computation are followed in these interim financial statements as compared with the most recent annual financial statements.
On May 7, 2025, the Company's Board of Directors approved these interim financial statements for issuance.
Basis of Measurement
These financial statements have been prepared on a going concern basis under the historical cost basis, except for those assets and liabilities that are measured at fair value (Note 24) at the end of each reporting period.
Adoption of new accounting standards
The Company adopted various amendments to IFRS, which were effective for accounting periods beginning on or after January 1, 2025. These include amendments to IAS 21, Lack of Exchangeability. The impacts of adoption were not material to the Company's interim financial statements.
Page | 6
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
3. USE OF ESTIMATES, ASSUMPTIONS, AND JUDGEMENTS
The preparation of these interim financial statements requires management to make estimates and judgements that affect the reported amounts of assets and liabilities at the period end date and reported amounts of expenses during the reporting period. Such judgements and estimates are, by their nature, uncertain. Actual outcomes could differ from these estimates.
The impact of such judgements and estimates are pervasive throughout the interim financial statements, and may require accounting adjustments based on future occurrences. These judgements and estimates are continuously evaluated and are based on management's experience and knowledge of the relevant facts and circumstances. Revisions to accounting estimates are recognized in the period in which the estimate is revised and are accounted for prospectively.
In preparing these interim financial statements for the three months ended March 31, 2025, the Company applied the critical estimates, assumptions and judgements as disclosed in Note 4 of its audited consolidated financial statements for the year ended December 31, 2024.
4. TRADE AND OTHER RECEIVABLES
| March 31, 2025 $ | December 31, 2024 $ | |
|---|---|---|
| Trade receivables from doré and concentrate sales | 18,430 | 26,702 |
| Advances and other receivables | 4,836 | 4,332 |
| Value added tax receivables | 72,637 | 68,950 |
| Trade and other receivables | 95,903 | 99,984 |
The Company's trade receivables from concentrate and doré sales are expected to be collected in accordance with the terms of the existing concentrate and doré sales contracts with its customers. No amounts were past due as at March 31, 2025.
As at March 31, 2025, current Value Added Tax ("VAT") receivables include $18.6 million (December 31, 2024 - $20.4 million) for Argentina, $nil (December 31, 2024 - $4.3 million) for Mexico, $31.0 million (December 31, 2024 - $22.2 million) for Côte d'Ivoire, and $21.0 million (December 31, 2024 - $20.6 million) for Burkina Faso. An additional $31.6 million (December 31, 2024 - $28.4 million) of VAT receivables are classified as non-current (refer to Note 8).
VAT receivables from the fiscal authorities in Burkina Faso are not in dispute and are deemed to be fully recoverable. The most recent refund was received in August 2024. The Company is following the relevant process in Burkina Faso to recoup the VAT receivables and continues to engage with authorities to accelerate the repayment of the outstanding balance.
The Company has an investment strategy, which includes utilizing certain foreign exchange measures implemented by the Argentine Government, to address its local currency requirements in Argentina. As a result of this strategy, during the three months ended March 31, 2025, the Company recorded investment gains of $1.3 million (March 31, 2024 - $2.6 million) from trades in Argentine peso denominated cross-border securities.
Page | 7
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
5. INVENTORIES
| Note | March 31, 2025 $ | December 31, 2024 $ | |
|---|---|---|---|
| Ore stockpiles | 106,378 | 104,998 | |
| Materials and supplies | 51,253 | 55,864 | |
| Leach pad and gold-in-circuit | 29,015 | 26,673 | |
| Doré bars | 3,216 | 547 | |
| Concentrate stockpiles | 322 | 299 | |
| Total inventories | 190,184 | 188,381 | |
| Less: non-current portion | 8 | (54,278) | (53,885) |
| Current inventories | 135,906 | 134,496 |
During the three months ended March 31, 2025, the Company expensed $152.3 million of inventories to cost of sales (March 31, 2024 - $117.4 million).
6. OTHER CURRENT ASSETS
| March 31, 2025 $ | December 31, 2024 $ | |
|---|---|---|
| Prepaid expenses | 12,106 | 15,936 |
| Income tax receivable | 94 | 4,158 |
| Other | 219 | 339 |
| Other current assets | 12,419 | 20,433 |
As at March 31, 2025, prepaid expenses include $6.0 million (December 31, 2024 - $8.6 million) related to deposits and advances to contractors.
Page | 8
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
7. MINERAL PROPERTIES AND PROPERTY, PLANT AND EQUIPMENT
| Mineral properties - depletable $ | Mineral properties - non-depletable $ | Construction in progress $ | Property, plant & equipment $ | Total $ | |
|---|---|---|---|---|---|
| COST | |||||
| Balance as at December 31, 2024 | 1,615,173 | 272,610 | 73,892 | 1,018,636 | 2,980,311 |
| Additions | 15,968 | 10,320 | 15,094 | 9,850 | 51,232 |
| Changes in closure and reclamation provision | (2,055) | - | - | (85) | (2,140) |
| Disposals and write-offs | - | - | - | (2,929) | (2,929) |
| Reclassification to assets held for sale (1) | (240,010) | (4,780) | (6) | (170,289) | (415,085) |
| Transfers | - | - | (49,085) | 49,085 | - |
| Balance as at March 31, 2025 | 1,389,076 | 278,150 | 39,895 | 904,268 | 2,611,389 |
| ACCUMULATED DEPLETION AND IMPAIRMENT | |||||
| Balance as at December 31, 2024 | 900,386 | - | 49 | 540,689 | 1,441,124 |
| Disposals and write-offs | - | - | - | (2,707) | (2,707) |
| Reclassification to assets held for sale (1) | (240,010) | - | (49) | (165,838) | (405,897) |
| Depletion and depreciation | 40,623 | - | - | 21,922 | 62,545 |
| Balance as at March 31, 2025 | 700,999 | - | - | 394,066 | 1,095,065 |
| Net book value as at March 31, 2025 | 688,077 | 278,150 | 39,895 | 510,202 | 1,516,324 |
(1) Represents the net book value of mineral properties and property, plant and equipment of Cuzcatlan that were reclassified to assets held for sale during the period. These assets are presented separately on the statement of financial position. Refer to Note 22 for further details.
As at March 31, 2025, non-depletable mineral properties include $98.1 million of exploration and evaluation assets (December 31, 2024 - $97.8 million).
As at March 31, 2025, property, plant and equipment include right-of-use assets with a net book value of $83.3 million (December 31, 2024 - $66.3 million). Related depletion and depreciation for the three months ended March 31, 2025, was $4.9 million (March 31, 2024 - $3.5 million).
Page | 9
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
| Mineral properties - depletable $ | Mineral properties - non-depletable $ | Construction in progress $ | Property, plant & equipment $ | Total $ | |
|---|---|---|---|---|---|
| COST | |||||
| Balance as at December 31, 2023 | 1,540,342 | 244,235 | 44,218 | 941,528 | 2,770,323 |
| Additions | 82,553 | 29,165 | 74,018 | 42,030 | 227,766 |
| Changes in closure and reclamation provision | 2,890 | - | - | (45) | 2,845 |
| Disposals and write-offs (1) | - | (14,485) | - | (6,138) | (20,623) |
| Transfers (2) | (10,612) | 13,695 | (44,344) | 41,261 | - |
| Balance as at December 31, 2024 | 1,615,173 | 272,610 | 73,892 | 1,018,636 | 2,980,311 |
| ACCUMULATED DEPLETION AND IMPAIRMENT | |||||
| Balance as at December 31, 2023 | 723,255 | - | 49 | 472,807 | 1,196,111 |
| Disposals and write-offs | - | - | - | (5,341) | (5,341) |
| Depletion and depreciation | 177,131 | - | - | 73,223 | 250,354 |
| Balance as at December 31, 2024 | 900,386 | - | 49 | 540,689 | 1,441,124 |
| Net book value as at December 31, 2024 | 714,787 | 272,610 | 73,843 | 477,947 | 1,539,187 |
(1) In July 2021, the Company completed the acquisition of Roxgold Inc. including its Boussoura exploration property in Burkina Faso. However, in December 2024, the Company confirmed that substantive expenditure on further exploration and evaluation of mineral resources at the Boussoura site is neither budgeted nor planned. As such, no future value is expected from the Boussoura property. Therefore, the carrying amount of the exploration and evaluation asset exceeded its recoverable amount and the Company recorded a write-off of the exploration property of $14.5 million. The Company reversed its deferred tax liability of $1.6 million related to exploration and evaluation assets subsequently to recording a write-off.
(2) In December 2024, the Company concluded a comprehensive review of its capitalized exploration costs associated with mineral properties. This review involved an analysis of drilling meters, exploration costs incurred to date, and an assessment of the likelihood of each prospect becoming part of the Company's mineral reserves. As a result of this review, certain prospects previously classified as depletable at the Séguéla mine were reclassified as non-depletable mineral properties, resulting in a net transfer of $13.7 million from depletable to non-depletable mineral properties. This reclassification reflects the updated assessment of the long-term economic viability and recoverability of mineral resources associated with these prospects and represents a true-up between depletable and non-depletable categories.
8. OTHER NON-CURRENT ASSETS
| Note | March 31, 2025 $ | December 31, 2024 $ | |
|---|---|---|---|
| Ore stockpiles | 5 | 54,278 | 53,885 |
| Value added tax receivables | 31,588 | 28,374 | |
| Income tax receivable | - | 1,152 | |
| Unamortized transaction costs | 1,337 | 1,390 | |
| Other | 5,638 | 5,303 | |
| Total other non-current assets | 92,841 | 90,104 |
As at March 31, 2025, ore stockpiles include $48.2 million (December 31, 2024 - $49.0 million) at the Lindero mine and $6.1 million (December 31, 2024 - $4.9 million) at the Séguéla mine.
As at March 31, 2025, non-current VAT receivables include $31.6 million (December 31, 2024 - $25.9 million) for Burkina Faso and $nil (December 31, 2024 - $2.5 million) for Mexico.
Page | 10
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
9. TRADE AND OTHER PAYABLES
| Note | March 31, 2025 $ | December 31, 2024 $ | |
|---|---|---|---|
| Trade accounts payable | 95,991 | 91,180 | |
| Payroll and related payables | 20,107 | 30,345 | |
| Mining royalty payable | 4,752 | 4,433 | |
| Other payables | 12,781 | 15,565 | |
| Share units payable | 15(a)(b)(c) | 13,214 | 10,119 |
| Total trade and other payables | 146,845 | 151,642 |
As at March 31, 2025, other payables include $nil (December 31, 2024 - $6.6 million) of severance provisions for the anticipated closure of the San Jose mine. As at March 31, 2025, other payables also include $3.9 million (December 31, 2024 - $nil) related to 1,272 ounces of gold sold under an advanced sales contract but not yet delivered at Lindero. Although consideration was received, the related ounces had not yet been poured and did not meet the criteria for revenue recognition.
10. RELATED PARTY TRANSACTIONS
In addition to the related party transactions and balances disclosed elsewhere in these financial statements, the Company entered into the following related party transactions during the three months ended March 31, 2025 and 2024:
Key Management Personnel
Amounts paid to key management personnel were as follows:
| Three months ended March 31, | ||
|---|---|---|
| 2025 | 2024 | |
| $ | $ | |
| Salaries and benefits | 2,943 | 2,931 |
| Directors fees | 218 | 215 |
| Consulting fees | 21 | 17 |
| Share-based payments | 5,619 | 1,741 |
| 8,801 | 4,904 |
During the three months ended March 31, 2025 and 2024, the Company was charged for consulting services by Mario Szotlender, a director of the Company.
On March 28, 2025, the Company reached an agreement to sell its 100% interest in Cuzcatlan to JRC Ingeniería y Construcción S.A.C. ("JRC"). The transaction subsequently closed on April 11, 2025. Luis D. Ganoza, the Company's Chief Financial Officer, is an independent, non-shareholding director of JRC and disclosed this relationship to the Fortuna's Board of Directors. Refer to Notes 22 and 28 for further details of the sale.
Page | 11
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
11. LEASE OBLIGATIONS
| Minimum lease payments | ||
|---|---|---|
| March 31, 2025 $ | December 31, 2024 $ | |
| Less than one year | 25,831 | 24,849 |
| Between one and five years | 51,893 | 50,868 |
| More than five years | 6,002 | 6,618 |
| 83,726 | 82,335 | |
| Less: future finance charges | (13,839) | (14,358) |
| Present value of lease obligations | 69,887 | 67,977 |
| Less: current portion | (20,534) | (19,761) |
| Non-current portion | 49,353 | 48,216 |
12. DEBT
The following table summarizes the changes in debt:
| 2024 Convertible Notes $ | 2019 Convertible Debentures $ | Credit Facility $ | Total $ | |
|---|---|---|---|---|
| Balance as at December 31, 2023 | - | 43,901 | 162,946 | 206,847 |
| Proceeds from debentures | 172,500 | - | - | 172,500 |
| Drawdown | - | - | 68,000 | 68,000 |
| Transaction costs | (6,488) | - | - | (6,488) |
| Portion allocated to equity | (45,999) | - | - | (45,999) |
| Convertible debt conversions | - | (35,383) | - | (35,383) |
| Transaction costs allocated to equity | 1,730 | - | - | 1,730 |
| Amortization of discount and transaction costs | 4,288 | 1,131 | 2,054 | 7,473 |
| Extinguishment of debt | - | 146 | - | 146 |
| Payments | - | (9,795) | (233,000) | (242,795) |
| Balance as at December 31, 2024 | 126,031 | - | - | 126,031 |
| Amortization of discount and transaction costs | 1,957 | - | - | 1,957 |
| Balance as at March 31, 2025 | 127,988 | - | - | 127,988 |
| Non-current portion | 127,988 | - | - | 127,988 |
The Company maintains a $150.0 million revolving credit facility (the "Credit Facility") with an uncommitted accordion option of $75.0 million. The Credit Facility is subject to certain conditions and covenants customary for a facility of this nature. The Company is required to comply with certain financial covenants which include among others: maintaining an interest coverage ratio (calculated on a rolling four fiscal quarter basis) of not less than 4.00:1.00; a Net Total Debt (as defined in the facility) to EBITDA ratio (calculated on a rolling four fiscal quarters basis) of not more than 4.00:1.00; and a Net Senior Secured Debt (as defined in the facility) to EBITDA ratio (calculated on a rolling four fiscal quarters basis) of not more than 2.25:1.00. As at March 31, 2025, the Company was in compliance with all of the covenants under the Credit Facility.
As at March 31, 2025, the Credit Facility remained undrawn, except for Letters of Credit.
Page | 12
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
13. OTHER NON-CURRENT LIABILITIES
| Note | March 31, 2025 $ | December 31, 2024 $ | |
|---|---|---|---|
| Restricted share units | 15(b) | 2,165 | 3,944 |
| Other | 147 | 146 | |
| Total other non-current liabilities | 2,312 | 4,090 |
14. CLOSURE AND RECLAMATION PROVISIONS
The following table summarizes the changes in closure and reclamation provisions:
| Caylloma $ | San Jose(1) $ | Lindero $ | Yaramoko $ | Séguéla $ | Total $ | |
|---|---|---|---|---|---|---|
| Balance as at December 31, 2024 | 15,356 | 14,677 | 15,470 | 14,724 | 15,110 | 75,337 |
| Changes in estimate (2) | (1,416) | 460 | 356 | (375) | (705) | (1,680) |
| Reclamation expenditures | (11) | (143) | - | - | - | (154) |
| Accretion | 213 | 341 | 185 | 156 | 165 | 1,060 |
| Effect of changes in foreign exchange rates | - | (35) | - | - | - | (35) |
| Reclassification to liabilities directly associated with assets held for sale | - | (15,300) | - | - | - | (15,300) |
| Balance as at March 31, 2025 | 14,142 | - | 16,011 | 14,505 | 14,570 | 59,228 |
| Less: current portion | (353) | - | - | - | - | (353) |
| Non-current portion | 13,789 | - | 16,011 | 14,505 | 14,570 | 58,875 |
(1) Represents the closure and reclamation provisions of Cuzcatlan that were reclassified to liabilities held for sale during the period. These provisions are presented separately on the statement of financial position (see Note 22).
(2) The change in estimate for the San Jose mine of $0.5 million was included in net loss from discontinued operation, net of tax in the Company's consolidated statements of income for the three months ended March 31, 2025.
| Caylloma $ | San Jose $ | Lindero $ | Yaramoko $ | Séguéla $ | Total $ | |
|---|---|---|---|---|---|---|
| Balance as at December 31, 2023 | 15,950 | 10,358 | 14,485 | 14,233 | 10,777 | 65,803 |
| Changes in estimate (1) | (1,259) | 7,231 | 349 | (128) | 3,883 | 10,076 |
| Reclamation expenditures | (259) | (2,035) | - | - | - | (2,294) |
| Accretion | 924 | 922 | 636 | 619 | 450 | 3,551 |
| Effect of changes in foreign exchange rates | - | (1,799) | - | - | - | (1,799) |
| Balance as at December 31, 2024 | 15,356 | 14,677 | 15,470 | 14,724 | 15,110 | 75,337 |
| Less: current portion | (86) | (4,424) | - | - | - | (4,510) |
| Non-current portion | 15,270 | 10,253 | 15,470 | 14,724 | 15,110 | 70,827 |
(1) The change in estimate for the San Jose mine of $7.2 million was included in other expenses in the Company's consolidated statements of income for the year ended December 31, 2024.
Page | 13
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
The following table summarizes certain key inputs used in determining the present value of reclamation costs related to mine and development sites:
| Caylloma $ | San Jose(1) $ | Lindero $ | Yaramoko $ | Séguéla $ | Total $ | |
|---|---|---|---|---|---|---|
| Undiscounted uninflated estimated cash flows | 17,572 | 17,437 | 17,091 | 14,790 | 16,293 | 83,183 |
| Discount rate | 5.93% | 9.29% | 4.61% | 3.66% | 3.81% | |
| Inflation rate | 2.80% | 3.77% | 2.43% | 2.45% | 2.19% |
(1) Represents the key inputs of Cuzcatlan, which was classified as held for sale as at March 31, 2025 (see Note 22).
The Company is expecting to incur progressive reclamation costs throughout the life of its mines.
15. SHARE-BASED PAYMENTS
During the three months ended March 31, 2025, the Company recognized share-based payments of $9.1 million, (March 31, 2024 - $2.2 million) related to the amortization of deferred, restricted and performance share units.
(a) Deferred Share Units
| Cash Settled | ||
|---|---|---|
| Number of DSUs | Fair Value $ | |
| Outstanding, December 31, 2023 | 1,048,500 | 4,043 |
| Granted | 135,316 | 438 |
| Changes in fair value | - | 595 |
| Outstanding, December 31, 2024 | 1,183,816 | 5,076 |
| Granted | 83,992 | 387 |
| Changes in fair value | - | 2,254 |
| Outstanding, March 31, 2025 | 1,267,808 | 7,717 |
(b) Restricted Share Units
| Cash Settled | ||
|---|---|---|
| Number of RSUs | Fair Value $ | |
| Outstanding, December 31, 2023 | 2,668,197 | 5,216 |
| Granted | 1,956,611 | - |
| Units paid out in cash | (896,413) | (3,160) |
| Forfeited or cancelled | (179,402) | (332) |
| Changes in fair value and vesting | - | 7,263 |
| Outstanding, December 31, 2024 | 3,548,993 | 8,987 |
| Granted | 1,354,613 | - |
| Units paid out in cash | (1,215,034) | (6,153) |
| Forfeited or cancelled | (18,124) | (41) |
| Changes in fair value and vesting | - | 4,869 |
| Outstanding, March 31, 2025 | 3,670,448 | 7,662 |
| Less: current portion | (5,497) | |
| Non-current portion | 2,165 |
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
RSUs granted during the three months ended March 31, 2025, had a weighted average fair value of C$6.62 per unit at the date of the grant (December 31, 2024 - C$4.36).
(c) Performance Share Units
| Cash Settled | Equity Settled | ||
|---|---|---|---|
| Number of PSUs | Fair Value $ | Number of PSUs | |
| Outstanding, December 31, 2023 | - | - | 1,840,012 |
| Granted | - | - | 1,038,383 |
| Vested and paid out in shares | - | - | (823,433) |
| Outstanding, December 31, 2024 | - | - | 2,054,962 |
| Granted | - | - | 743,709 |
| Vested and paid out in shares | - | - | (802,164) |
| Outstanding, March 31, 2025 | - | - | 1,996,507 |
PSUs granted during the three months ended March 31, 2025, had a weighted average fair value of C$6.62 per unit at the date of the grant (December 31, 2024 - C$4.36).
During the three months ended March 31, 2025, PSUs vested and were settled in shares. Based on agreed performance outcomes, a weighted average multiplier of 118% (December 31, 2024 - 72%) was applied, resulting in the issuance of 948,697 (December 31, 2024 - 589,574) common shares upon vesting.
(d) Stock Options
The Company's Stock Option Plan, as amended and approved from time to time, permits the Company to issue up to 12,200,000 stock options. As at March 31, 2025, a total of 2,950,529 stock options are available for issuance under the plan. As at March 31, 2025, no stock options were outstanding (December 31, 2024 - none).
- SHARE CAPITAL
Authorized Share Capital
The Company has an unlimited number of common shares without par value authorized for issue.
On April 30, 2025, the Company announced that the TSX had approved the renewal of the Company's normal course Issuer bid program ("NCIB") to purchase up to 15,347,999 common shares, being 5% of its outstanding common shares as at April 23, 2025. Under the NCIB, purchases of common shares may be made through the facilities of the TSX, the NYSE and/or alternative Canadian trading systems. The share repurchase program started on May 2, 2025 and will end on the earlier of May 1, 2026; the date the Company acquires the maximum number of common shares allowable under the NCIB; or the date the Company otherwise decides not to make any further repurchases under the NCIB.
During the three months ended March 31, 2025, the Company acquired and cancelled 916,900 common shares (March 31, 2024 - 1,030,375) at an average cost of $4.53 per share (March 31, 2024 - $3.42), excluding brokerage fees, for a total cost of $4.2 million (March 31, 2024 - $3.5 million).
Page | 15
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
17. EARNINGS PER SHARE
| Three months ended March 31, | ||
|---|---|---|
| 2025 | 2024 | |
| $ | $ | |
| Basic: | ||
| Net income from continuing operations attributable to Fortuna shareholders | 61,669 | 26,739 |
| Net income attributable to Fortuna shareholders | 58,503 | 26,250 |
| Weighted average number of shares (000's) | 306,614 | 306,470 |
| Earnings per share from continuing operations - basic | 0.20 | 0.09 |
| Earnings per share - basic | 0.19 | 0.09 |
| Three months ended March 31, | ||
| 2025 | 2024 | |
| $ | $ | |
| Diluted: | ||
| Net income from continuing operations attributable to Fortuna shareholders | 61,669 | 26,739 |
| Diluted net income from continuing operations for the period | 61,669 | 26,739 |
| Net income attributable to Fortuna shareholders | 58,503 | 26,250 |
| Diluted net income for the period | 58,503 | 26,250 |
| Weighted average number of shares (000's) | 306,614 | 306,470 |
| Incremental shares from dilutive potential shares | 1,451 | 1,729 |
| Weighted average diluted number of shares (000's) | 308,065 | 308,199 |
| Earnings per share from continuing operations - diluted | 0.20 | 0.09 |
| Earnings per share - diluted | 0.19 | 0.09 |
The incremental shares from dilutive potential shares primarily consist of share units. For the three months ended March 31, 2025, 26,172,045 (March 31, 2024 - 9,143,000) potential shares issuable on conversion of the 2024 Convertible Notes (March 31, 2024 - 2019 Convertible Debentures) were excluded from the diluted earnings per share calculation. These items were excluded from the diluted earnings per share calculations as their effect would have been anti-dilutive.
Page | 16
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
18. SALES
The Company's geographical analysis of revenue from contracts with customers attributed to the location of the products produced, is as follows:
| Three months ended March 31, 2025 | |||||
|---|---|---|---|---|---|
| Argentina $ | Burkina Faso $ | Côte d’Ivoire $ | Peru $ | Total $ | |
| Gold doré | 53,154 | 95,108 | 110,998 | - | 259,260 |
| Silver-lead concentrates | - | - | - | 30,669 | 30,669 |
| Provisional pricing adjustments | - | - | - | 216 | 216 |
| Sales to external customers | 53,154 | 95,108 | 110,998 | 30,885 | 290,145 |
| Three months ended March 31, 2024 | |||||
| --- | --- | --- | --- | --- | --- |
| Argentina $ | Burkina Faso $ | Côte d’Ivoire $ | Peru $ | Total $ | |
| Gold doré | 45,212 | 56,911 | 72,161 | - | 174,284 |
| Silver-lead concentrates | - | - | - | 15,980 | 15,980 |
| Zinc concentrates | - | - | - | 10,875 | 10,875 |
| Provisional pricing adjustments | - | - | - | (234) | (234) |
| Sales to external customers | 45,212 | 56,911 | 72,161 | 26,621 | 200,905 |
The following table presents the Company's revenue by customer for the three months ended March 31, 2025 and 2024:
| Three months ended March 31, | ||
|---|---|---|
| 2025 | 2024 | |
| $ | $ | |
| Customer 1 | 110,998 | 72,161 |
| Customer 2 | 95,108 | 56,911 |
| Customer 3 | 53,154 | 45,212 |
| Customer 4 | 30,885 | 26,621 |
| 290,145 | 200,905 |
From time to time, the Company enters into forward sale and collar contracts to mitigate the price risk for some of its forecasted base and precious metals production, and non-metal commodities.
Page | 17
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
19. COST OF SALES
| Three months ended March 31, | ||
|---|---|---|
| 2025 | 2024 | |
| $ | $ | |
| Direct mining costs | 74,435 | 54,301 |
| Depletion and depreciation | 61,302 | 49,455 |
| Salaries and benefits | 19,684 | 16,837 |
| Royalties and other taxes | 18,196 | 10,372 |
| Workers' participation | 777 | 351 |
| Other | (123) | - |
| Cost of sales | 174,271 | 131,316 |
For the three months ended March 31, 2025, depletion and depreciation includes $4.8 million of depreciation related to right-of-use assets (March 31, 2024 - $3.4 million).
On January 7, 2025, the Director General of Taxes in Côte d'Ivoire issued a communiqué announcing that the Fiscal Annex 2025 would become effective on January 10, 2025. The Fiscal Annex includes an increase of 2% in ad valorem tax rates applicable to mining operations. This change applies to gold revenue generated from the Company's Séguéla mine and is reflected in the results for the three months ended March 31, 2025.
20. GENERAL AND ADMINISTRATION
| Three months ended March 31, | ||
|---|---|---|
| 2025 | 2024 | |
| $ | $ | |
| General and administration | 16,137 | 14,501 |
| Workers' participation | 30 | 71 |
| 16,167 | 14,572 | |
| Share-based payments | 9,129 | 2,200 |
| General and administration | 25,296 | 16,772 |
21. INTEREST AND FINANCE COSTS, NET
| Three months ended March 31, | ||
|---|---|---|
| 2025 | 2024 | |
| $ | $ | |
| Interest income | 3,438 | 781 |
| Credit facilities and other interest | (528) | (3,498) |
| 2024 Convertible Notes interest | (1,617) | - |
| Amortization of discount and transaction costs | (2,091) | (750) |
| Bank stand-by and commitment fees | (236) | (177) |
| Accretion expense | (719) | (827) |
| Lease liabilities | (1,275) | (1,022) |
| 2019 Convertible Debentures interest | - | (530) |
| (3,028) | (6,023) |
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
22. ASSETS HELD FOR SALE AND DISCONTINUED OPERATION
(a) Accounting Policy – Assets Held for Sale and Discontinued Operation
The Company classifies non-current assets and disposal groups as held for sale when their carrying amounts are expected to be recovered principally through a sale transaction rather than through continuing use. Assets or disposal groups classified as held for sale are measured at the lower of their carrying amount and fair value less costs to sell. Costs to sell are the incremental costs directly attributable to the disposal, excluding finance costs and income tax expense.
Classification as held for sale is appropriate only when the sale is highly probable, the asset or disposal group is available for immediate sale in its present condition, and management is committed to a plan to sell. The sale must be expected to complete within one year from the date of classification, and it must be unlikely that significant changes to or withdrawal of the plan will occur. Property, plant and equipment and intangible assets are not depreciated or amortized once classified as held for sale. Related assets and liabilities are presented separately as current items in the statement of financial position.
A discontinued operation is a component of the Company that has been disposed of or is classified as held for sale and represents a separate major line of business or geographical area of operations. The results of discontinued operations are excluded from continuing operations and are presented as a single amount, net of tax, in the statement of profit or loss.
(b) Accounting Disclosure
On March 31, 2025, the Company was committed to a plan to sell its interest in Cuzcatlan, which owns and operates the San Jose Mine in Oaxaca, Mexico. As a result, the assets and liabilities of Cuzcatlan have been classified as held for sale, and its operating results have been presented as a discontinued operation in the condensed interim consolidated financial statements for the three months ended March 31, 2025.
The Company recognized a single amount of post-tax profit or loss from the discontinued operation in the condensed interim consolidated statement of income. Comparative information for the three months ended March 31, 2024, has been restated to reflect the results of the San Jose Mine as a discontinued operation, separately from continuing operations.
Page | 19
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
Results of Discontinued Operation
The following table presents the results of Cuzcatlan for the three months ended March 31, 2025, reported as a discontinued operation:
| Three months ended March 31, | ||
|---|---|---|
| 2025 | 2024 | |
| $ | $ | |
| Sales | 149 | 24,044 |
| Cost of sales | 149 | 23,724 |
| Mine operating income | - | 320 |
| General and administration | 638 | 1,458 |
| Foreign exchange loss | 12 | 154 |
| Other expenses (income) | 2,192 | (102) |
| 2,842 | 1,510 | |
| Operating loss | (2,842) | (1,190) |
| Interest and finance costs, net | (325) | (195) |
| (325) | (195) | |
| Loss before income taxes | (3,167) | (1,385) |
| Income taxes | ||
| Current income tax recovery | (1) | - |
| Deferred income tax recovery | - | (896) |
| (1) | (896) | |
| Net loss from discontinued operation, net of tax | (3,166) | (489) |
| Loss per share from discontinued operation | ||
| Basic | (0.01) | - |
| Diluted | (0.01) | - |
As at March 31, 2025, there are no items in other comprehensive income (loss) related to assets and associated liabilities held for sale.
Cash Flows of Discontinued Operation
The Company presents a single consolidated statement of cash flows, which includes cash flows from both continuing and discontinued operations. The following table summarizes the cash flows attributable to Cuzcatlan:
| Three months ended March 31, | ||
|---|---|---|
| 2025 | 2024 | |
| $ | $ | |
| Net cash used in operating activities | (9,897) | (4,979) |
| Cash provided by (used in) investing activities | 1,974 | (2,907) |
| Cash used in financing activities | (22) | (261) |
| Decrease in cash and cash equivalents during the period | (7,945) | (8,147) |
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
Summary of Assets and Associated Liabilities Held for Sale
The major classes of assets and liabilities of Cuzcatlan that were classified as held for sale as at March 31, 2025, are as follows:
| Balance at | March 31, 2025 |
|---|---|
| Cash and cash equivalents | 3,060 |
| Trade and other receivables | 1,834 |
| Inventories | 2,794 |
| Mineral properties and property, plant and equipment | 9,188 |
| Other assets | 6,888 |
| Total assets held for sale | 23,764 |
| Trade and other payables | 1,819 |
| Current portion of lease obligations | 201 |
| Closure and reclamation provisions | 15,300 |
| Total liabilities directly associated with assets held for sale | 17,320 |
23. SEGMENTED INFORMATION
The Company's operating segments are based on the reports reviewed by the senior management group that are used to make strategic decisions. The Chief Executive Officer, as chief operating decision maker, considers the business from a geographic perspective when considering the performance of the Company's business units.
The following summary describes the operations of each reportable segment:
- Mansfield Minera S.A. ("Mansfield") – operates the Lindero gold mine
- Roxgold SANU S.A. ("Sanu") – operates the Yaramoko gold mine
- Roxgold SANGO S.A. ("Sango") – operates the Séguéla gold mine
- Minera Bateas S.A.C. ("Bateas") – operates the Caylloma silver, lead, and zinc mine
- Corporate – corporate stewardship and projects outside other segments
Discontinued operation:
- Cuzcatlan – formerly operated the San Jose silver-gold mine. Classified as held for sale and a discontinued operation as at March 31, 2025. See notes 22 and 28.
Page | 21
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
| Three months ended March 31, 2025 | ||||||
|---|---|---|---|---|---|---|
| Mansfield $ | Sanu $ | Sango $ | Bateas $ | Corporate $ | Total $ | |
| Revenues from external customers | 53,154 | 95,108 | 110,998 | 30,885 | - | 290,145 |
| Cost of sales before depreciation and depletion | (22,005) | (42,677) | (35,116) | (13,171) | - | (112,969) |
| Depreciation and depletion in cost of sales | (9,799) | (16,900) | (30,310) | (4,293) | - | (61,302) |
| General and administration | (2,498) | (1,394) | (2,602) | (2,573) | (16,229) | (25,296) |
| Other (expenses) income | (1,390) | 1,781 | 1,482 | (345) | (243) | 1,285 |
| Finance items | 2,387 | 18 | (986) | (122) | (2,953) | (1,656) |
| Segment income (loss) before taxes | 19,849 | 35,936 | 43,466 | 10,381 | (19,425) | 90,207 |
| Income taxes | (1,221) | (6,845) | (8,133) | (3,133) | (2,901) | (22,233) |
| Segment income (loss) after taxes from continuing operations | 18,628 | 29,091 | 35,333 | 7,248 | (22,326) | 67,974 |
| Three months ended March 31, 2024 | ||||||
| --- | --- | --- | --- | --- | --- | --- |
| Mansfield $ | Sanu $ | Sango $ | Bateas $ | Corporate $ | Total $ | |
| Revenues from external customers | 45,212 | 56,911 | 72,161 | 26,621 | - | 200,905 |
| Cost of sales before depreciation and depletion | (22,468) | (24,736) | (21,161) | (13,497) | 1 | (81,861) |
| Depreciation and depletion in cost of sales | (11,581) | (10,215) | (24,048) | (3,611) | - | (49,455) |
| General and administration | (2,891) | (550) | (1,332) | (1,308) | (10,691) | (16,772) |
| Other (expenses) income | (603) | (1,949) | (2,840) | 49 | 851 | (4,492) |
| Finance items | 2,218 | (294) | (598) | (172) | (4,529) | (3,375) |
| Segment income (loss) before taxes | 9,887 | 19,167 | 22,182 | 8,082 | (14,368) | 44,950 |
| Income taxes | (986) | (3,996) | (5,974) | (2,794) | (1,644) | (15,394) |
| Segment income (loss) after taxes from continuing operations | 8,901 | 15,171 | 16,208 | 5,288 | (16,012) | 29,556 |
| As at March 31, 2025 | Mansfield $ | Sanu $ | Sango $ | Cuzcatlan(1) $ | Bateas $ | Corporate $ |
| --- | --- | --- | --- | --- | --- | --- |
| Total assets | 573,994 | 211,562 | 948,194 | 23,764 | 151,623 | 277,423 |
| Total liabilities | 49,315 | 74,994 | 298,774 | 17,320 | 47,344 | 170,091 |
| Capital expenditures (2) | 13,288 | 452 | 29,838 | 89 | 1,710 | 5,855 |
(1) Represents the total assets, total liabilities and capital expenditures of Cuzcatlan that were reclassified to assets and associated liabilities held for sale during the period. These assets and liabilities are presented separately on the statement of financial position (see Note 22).
(2) Capital expenditures are on an accrual basis for the three months ended March 31, 2025.
| As at December 31, 2024 | Mansfield $ | Sanu $ | Sango $ | Cuzcatlan $ | Bateas $ | Corporate $ | Total $ |
|---|---|---|---|---|---|---|---|
| Total assets | 554,396 | 178,769 | 939,303 | 59,098 | 153,586 | 230,380 | 2,115,532 |
| Total liabilities | 48,597 | 68,518 | 278,899 | 33,774 | 56,625 | 163,046 | 649,459 |
| Capital expenditures (1) | 69,636 | 32,401 | 80,580 | 6,653 | 23,323 | 15,173 | 227,766 |
(1) Capital expenditures are on an accrual basis for the year ended December 31, 2024.
Page | 22
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
24. FAIR VALUE MEASUREMENTS
(a) Financial Assets and Financial Liabilities by Category
The carrying amounts of the Company’s financial assets and financial liabilities by category are as follows:
| As at March 31, 2025 | Fair value through OCI $ | Fair value through profit or loss $ | Amortized cost $ | Total $ |
|---|---|---|---|---|
| Financial assets | ||||
| Cash and cash equivalents | - | - | 305,048 | 305,048 |
| Trade receivables concentrate sales | - | 12,913 | - | 12,913 |
| Trade receivables doré sales | - | - | 5,517 | 5,517 |
| Short-term investments | - | 4,355 | - | 4,355 |
| Investments in equity securities | 69 | - | - | 69 |
| Other receivables | - | - | 4,836 | 4,836 |
| Total financial assets | 69 | 17,268 | 315,401 | 332,738 |
| Financial liabilities | ||||
| Trade payables | - | - | (95,991) | (95,991) |
| Payroll payable | - | - | (20,107) | (20,107) |
| Share units payable | - | (15,379) | - | (15,379) |
| 2024 Convertible Notes | - | - | (127,988) | (127,988) |
| Other payables | - | - | (83,740) | (83,740) |
| Total financial liabilities | - | (15,379) | (327,826) | (343,205) |
| As at December 31, 2024 | Fair value through OCI $ | Fair value through profit or loss $ | Amortized cost $ | Total $ |
| --- | --- | --- | --- | --- |
| Financial assets | ||||
| Cash and cash equivalents | - | - | 231,328 | 231,328 |
| Trade receivables concentrate sales | - | 18,920 | - | 18,920 |
| Trade receivables doré sales | - | - | 7,782 | 7,782 |
| Investments in equity securities | 119 | - | - | 119 |
| Other receivables | - | - | 4,332 | 4,332 |
| Total financial assets | 119 | 18,920 | 243,442 | 262,481 |
| Financial liabilities | ||||
| Trade payables | - | - | (91,180) | (91,180) |
| Payroll payable | - | - | (30,345) | (30,345) |
| Share units payable | - | (14,063) | - | (14,063) |
| 2024 Convertible Notes | - | - | (126,031) | (126,031) |
| Other payables | - | - | (84,383) | (84,383) |
| Total financial liabilities | - | (14,063) | (331,939) | (346,002) |
Page | 23
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
(b) Fair Values of Financial Assets and Financial Liabilities
During the three months ended March 31, 2025 and 2024, there were no transfers of amounts between Level 1, Level 2, and Level 3 of the fair value hierarchy. The fair values of the Company's financial assets and financial liabilities that are measured at fair value, including their levels in the fair value hierarchy are as follows:
| As at March 31, 2025 | Level 1 $ | Level 2 $ | Level 3 $ | Total $ |
|---|---|---|---|---|
| Trade receivables concentrate sales | - | 12,913 | - | 12,913 |
| Short-term investments | - | 4,355 | - | 4,355 |
| Investments in equity securities | 69 | - | - | 69 |
| Share units payable | - | (15,379) | - | (15,379) |
| As at December 31, 2024 | Level 1 $ | Level 2 $ | Level 3 $ | Total $ |
| --- | --- | --- | --- | --- |
| Trade receivables concentrate sales | - | 18,920 | - | 18,920 |
| Investments in equity securities | 119 | - | - | 119 |
| Share units payable | - | (14,063) | - | (14,063) |
(c) Financial Assets and Financial Liabilities Not Already Measured at Fair Value
The estimated fair values by the Level 2 fair value hierarchy of the Company's financial liabilities that are not accounted for at a fair value as compared to the carrying amount were as follows:
| March 31, 2025 | December 31, 2024 | |||
|---|---|---|---|---|
| Carrying amount $ | Fair value $ | Carrying amount $ | Fair value $ | |
| 2024 Convertible Notes (1) | (127,988) | (209,588) | (126,031) | (177,330) |
| (127,988) | (209,588) | (126,031) | (177,330) |
(1) The carrying amounts of the 2024 Convertible Notes represents the liability components (Note 12), while the fair value represents the liability and equity components. The fair value of the 2024 Convertible Notes is based on the quoted prices in markets that are not active for the underlying securities.
25. SUPPLEMENTAL CASH FLOW INFORMATION
Changes in working capital for the three months ended March 31, 2025 and 2024 are as follows:
| Three months ended March 31, | ||
|---|---|---|
| 2025 $ | 2024 $ | |
| Trade and other receivables | 810 | (7,296) |
| Prepaid expenses | 1,067 | (864) |
| Inventories | (5,628) | (9,801) |
| Trade and other payables | (7,930) | (17,366) |
| Total changes in working capital | (11,681) | (35,327) |
Page | 24
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
The changes in liabilities arising from financing activities, including both changes arising from cash flows and non-cash changes for the periods as set out below are as follows:
| 2024 Convertible Notes $ | 2019 Convertible Debentures $ | Credit Facility $ | Lease obligations $ | |
|---|---|---|---|---|
| As at December 31, 2023 | - | 43,901 | 162,946 | 57,401 |
| Additions | 172,500 | - | 68,000 | 27,038 |
| Terminations | - | - | - | (75) |
| Conversion of debenture | - | (35,383) | - | - |
| Interest | 4,288 | 1,131 | 2,054 | 4,507 |
| Payments | - | (9,795) | (233,000) | (20,690) |
| Transaction costs | (6,488) | - | - | - |
| Equity component | (44,269) | - | - | - |
| Extinguishment of debt | - | 146 | - | - |
| Foreign exchange | - | - | - | (204) |
| As at December 31, 2024 | 126,031 | - | - | 67,977 |
| Additions | - | - | - | 6,890 |
| Terminations | - | - | - | (192) |
| Interest | 1,957 | - | - | 1,281 |
| Payments | - | - | - | (6,001) |
| Reclassification to liabilities directly associated with assets held for sale | - | - | - | (201) |
| Foreign exchange | - | - | - | 133 |
| As at March 31, 2025 | 127,988 | - | - | 69,887 |
The significant non-cash financing and investing transactions during the three months ended March 31, 2025 and 2024 are as follows:
| Three months ended March 31, | ||
|---|---|---|
| 2025 $ | 2024 $ | |
| Mineral properties, plant and equipment changes in closure and reclamation provision | 2,140 | 842 |
| Additions to right-of-use assets | 6,890 | 267 |
| Share units allocated to share capital upon settlement | 3,294 | 681 |
26. NON-CONTROLLING INTERESTS
As at March 31, 2025, the non-controlling interests ("NCI") of the State of Burkina Faso, which represents a 10% interest in Sanu, totaled $12.9 million. The income attributable to the NCI for the three months ended March 31, 2025, totaling $2.9 million, is based on net income for Yaramoko.
As at March 31, 2025, the NCI of the State of Côte d'Ivoire, which represents a 10% interest in Sango, totaled $55.6 million. The income attributable to the NCI for the three months ended March 31, 2025, totaling $3.4 million, is based on net income for Séguéla.
Change in non-controlling interest
On March 14, 2025, the Company formally agreed to increase the State of Burkina Faso's equity interest in Sanu from 10% to 15%, in response to a request from the State to implement the provisions of the 2024 Mining Code.
Page | 25
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
The State’s registered interest in Sanu continued to be 10% as at March 31, 2025. The additional 5% interest in Sanu represented $6.4 million of net assets at March 31, 2025.
Subsequent to the end of the quarter, on April 16, 2025, Sanu paid a dividend to the State based on a 15% ownership interest consistent with the agreement reached with the State.
27. CONTINGENCIES AND CAPITAL COMMITMENTS
(a) Caylloma Letter of Guarantee
The Caylloma mine closure plan, as amended, that was in effect in September 2024, includes total undiscounted closure costs of $18.2 million, which consisted of progressive closure activities of $2.4 million, final closure activities of $13.5 million, and post closure activities of $2.3 million pursuant to the terms of the Mine Closing Law of Peru.
Under the terms of the current Mine Closing Law, the Company is required to provide the Peruvian Government with a guarantee in respect of the Caylloma mine closure plan as it relates to final closure activities and post-closure activities and related taxes. As at March 31, 2025, the Company provided a bank letter guarantee of $15.2 million to the Peruvian Government in respect of such closure costs and taxes.
(b) Other Commitments
Argentina
As at March 31, 2025, the Company had capital commitments of $5.7 million, for civil work, equipment purchases and other services at the Lindero mine, which are expected to be expended within one year.
Côte d'Ivoire
The Company entered into an agreement with a service provider at the Séguéla mine wherein if the Company terminates the agreement prior to the end of its term, in November 2026, the Company would be required to make an early termination payment, which is reduced monthly over 48 months. If the Company had terminated the agreement on March 31, 2025, and elected not to purchase the service provider’s equipment, it would have been subject to an early termination payment of $15.3 million. If the Company elected to purchase the service provider’s equipment, the early termination amount would be adjusted to exclude equipment depreciation and demobilization of equipment, and only include portion of the monthly management fee and demobilization of personnel.
Additional early termination payments may apply under certain other service agreements, amounting to an approximate cumulative fee of $4.5 million as at March 31, 2025.
(c) Tax Contingencies
The Company is, from time to time, involved in various tax assessments arising in the ordinary course of business. The Company cannot reasonably predict the likelihood or outcome of these actions. The Company has recognized tax provisions with respect to current assessments received from the tax authorities in the various jurisdictions in which the Company operates, and from any uncertain tax positions identified. For those amounts recognized related to current tax assessments received, the provision is based on management’s best estimate of the outcome of those assessments, based on the validity of the issues in the assessment, management’s support for their position, and the expectation with respect to any negotiations to settle the assessment. Management re-evaluates the
Page | 26
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
outstanding tax assessments regularly to update their estimates related to the outcome for those assessments taking into account the criteria above.
Pillar Two Global Minimum Tax
On June 30, 2024, the Global Minimum Tax Act ("GMTA") received royal assent, introducing the Pillar Two global minimum tax regime in Canada. The GMTA is based on the OECD's Pillar Two Global Anti-Base Erosion (GloBE) model rules and applies to fiscal years beginning after December 31, 2023. The legislation includes the income inclusion rule and a qualified domestic minimum top-up tax, and contains a placeholder for the undertaxed profits rule, which is proposed to be effective for fiscal years beginning after December 31, 2024.
The Pillar Two regime applies to multinational enterprise groups with consolidated revenues of at least EUR 750 million in at least two of the four fiscal years immediately preceding a given fiscal year. As the Company exceeded the threshold for a second time in 2024, Pillar Two legislation is applicable to the Company from January 1, 2025.
As at March 31, 2025, Pillar Two legislation has only been enacted in Canada among the jurisdictions in which the Company operates. The Company is in the process of assessing the potential impact of Pillar Two legislation, including the application of the transitional safe harbour rules. No Pillar Two top-up taxes have been recognized in the interim financial statements for the three months ended March 31, 2025.
(d) Other Contingencies
The Company is subject to various investigations and other claims; and legal, labour, and tax proceedings covering matters that arise in the ordinary course of business activities. Each of these matters is subject to various uncertainties, and it is possible that some of these matters may be resolved unfavourably for the Company. Certain conditions may exist as of the date these financial statements are issued that may result in a loss to the Company. None of these matters is expected to have a material effect on the results of operations or financial conditions of the Company.
- SUBSEQUENT EVENTS
Subsequent events not otherwise mentioned are as follows:
(a) Sale of the San Jose Mine
On April 11, 2025, the Company completed the sale of its 100% interest in Cuzcatlan, which owns the San Jose mine in Oaxaca, Mexico, to JRC, a private Peruvian company. Under the terms of the definitive share purchase agreement, JRC acquired all of the issued and outstanding shares of Cuzcatlan in consideration for $6.5 million, which was received on closing. Post closing JRC has paid $1.2 million for prepaid working capital items and tax receivables. The Company also has the right to receive contingent consideration of up to approximately $8.3 million, subject to the completion of certain conditions, of which $4.7 million has been received to date. Furthermore, the Company retains a 1.0% net smelter royalty on production from the San Jose Mine concessions payable after the first 6.1 million ounces of silver and the first 44,000 ounces of gold (or 119,000 gold equivalent ounces) have been mined or extracted from the property.
This transaction supersedes the previously disclosed binding letter agreement for the sale of Cuzcatlan to Minas del Balsas S.A. de C.V., which did not proceed.
Page | 27
Fortuna Mining Corp.
Notes to Condensed Interim Consolidated Financial Statements
For the three months ended March 31, 2025 and 2024
(Unaudited – Tabular amounts presented in thousands of US dollars, except share and per share amounts)
(b) Sale of the Yaramoko Mine
On April 11, 2025, the Company entered into a definitive share purchase agreement to sell all of its interest in Roxgold Sanu, which owns and operates the Yaramoko mine, together with the Company's three other wholly-owned Burkina Faso subsidiaries that hold exploration permits in the country, to Soleil Resources International Limited, a private Mauritius company, for consideration of $70M in cash upon closing and the right to receive up to $53.0 million in VAT receivables payable upon the completion of certain conditions. The completion of the Burkina Faso Transaction is subject to the payment of a cash dividend by Roxgold Sanu to Fortuna in the amount of $53.8 million plus $3.7 million in withholding tax. The sale is subject to customary closing conditions, including the approval of the Burkina Faso Minister of Mines, and is expected to close in the second quarter of 2025. Upon completion, the Company will cease all operations in Burkina Faso.
As of May 07, 2025, Roxgold Sanu has paid the $53.8 million dividend and the necessary withholding taxes.
This transaction represents a non-adjusting subsequent event as defined by IAS 10, Events After the Reporting Period. The criteria for classification as held for sale in accordance with IFRS 5, Non-current Assets Held for Sale and Discontinued Operations, were not met as of March 31, 2025. Accordingly, the carrying amounts of the four entities have not been reclassified as held for sale, and no adjustments have been made to the amounts recognized in these financial statements for the three months ended March 31, 2025.
(c) Ad Valorem Tax Rates Increase for Burkina Faso Operations
On April 7, 2025, the Burkina Faso government announced an increase in ad valorem tax on gold sales, effective immediately. The new tax regime introduces a change to the gold royalties for gold sold above $3,000 per ounce. An additional 1% royalty is payable for each $500 increment in the gold price above $3,000 per ounce. The previous cap was 7% of gold sales over $2,000 per ounce. These changes are not expected to materially impact the Company's financial position and results of operations.
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