Business Context and Reporting Period
Company: McEwen Inc. (formerly McEwen Mining Inc., renamed July 7, 2025)
Filing Type: Form 10-K Annual Report
Reporting Period: Fiscal year ended December 31, 2025
Business Overview: A gold and silver mining production and exploration company with an advanced copper development project, focused on the Americas. Operations include 100% ownership of the Gold Bar Mine Complex (Nevada, USA) and Fox Complex (Ontario, Canada); a 49% interest in the San José mine (Argentina); and a 46.3% interest in the Los Azules copper project (Argentina). The company also holds exploration assets in Mexico (El Gallo).
Key Financial Metrics (Year Ended Dec 31, 2025)
| Metric | 2025 Value | 2024 Value |
|---|---|---|
| Revenue (Gold/Silver Sales) | $197.6 million | $174.5 million |
| Gross Profit | $47.6 million | $30.9 million |
| Net Income | $34.4 million ($0.64/share) | Net Loss: $43.7 million ($0.86/share) |
| Adjusted EBITDA | $66.2 million ($1.22/share) | $29.2 million ($0.57/share) |
| Cash from Operating Activities | $6.9 million | $29.5 million |
| Capital Expenditures | $48.1 million | $43.1 million |
| Cash and Cash Equivalents | $51.0 million | $13.7 million |
| Long-Term Debt | $126.2 million | $40.0 million |
| Working Capital | $44.1 million | ($6.5 million) |
Note: Revenue excludes the San José mine, which is accounted for under the equity method. Equity income from San José was $41.1 million in 2025.
Material Changes vs. Prior Period
- Profitability Turnaround: The company returned to profitability with a net income of $34.4 million, reversing a $43.7 million loss in 2024. This was driven by a $16.6 million increase in gross profit, a $32.1 million increase in equity income from Minera Santa Cruz (MSC), and a $24.4 million increase in income tax recovery.
- Revenue Growth: Revenue increased 13% to $197.6 million, primarily due to a 48% increase in the average realized gold price ($3,532/oz in 2025 vs. $2,390/oz in 2024), partially offset by a 15% decrease in gold equivalent ounces (GEOs) sold from 100% owned operations.
- Production Volume: Consolidated GEO production decreased to 115,687 ounces (down from 135,884 in 2024). The Fox Complex production was 7% below guidance due to weather-related closures in Q4. Gold Bar production declined due to the transition from the higher-grade Gold Bar South deposit to the lower-grade Pick III deposit.
- Debt Structure: Long-term debt increased significantly to $126.2 million following the issuance of $110.0 million in 5.25% Convertible Senior Notes due 2030 in February 2025. The company also repaid $20.0 million of its term loan facility.
- Tax Benefit: A significant portion of the net income was driven by the release of a $30.2 million valuation allowance on U.S. deferred tax assets, based on sustained improvements in operating performance.
Guidance, Outlook, and Risks
Outlook and Guidance (2026)
- Gold Bar Mine Complex: Expected to produce 39,000–43,000 GEOs. Cash costs: $2,250–$2,450/oz; AISC: $2,350–$2,550/oz.
- Fox Complex: Expected to produce 16,000–19,000 GEOs. Cash costs: $2,200–$2,400/oz; AISC: $2,350–$2,550/oz.
- San José Mine (MSC): Expected to produce 59,000–64,000 GEOs. Cash costs: $2,000–$2,200/oz; AISC: $2,300–$2,500/oz.
- El Gallo (Mexico): Mill construction expected to begin mid-2026, with production commencing mid-2027. Projected to produce ~20,000 GEOs annually for 10 years.
- Stock Project (Canada): Commercial production targeted for 2027. Development investment in 2025 was $29.5 million.
Key Risks and Contingencies
- Commodity Price Volatility: Operations are highly dependent on gold, silver, and copper prices. The company does not hedge its production.
- Geopolitical and Regulatory Risks: Operations in Argentina (San José and Los Azules) face political instability, currency devaluation, and regulatory changes. Operations in Mexico (El Gallo) face security risks related to cartel activity in Sinaloa.
- Debt Obligations: The company has $110 million in convertible notes and a $20 million term loan. Failure to meet debt obligations could force asset sales or restructuring.
- Project Execution: Delays in permitting or construction for El Gallo and the Stock project could impact future production targets.
- Internal Controls: The company remediated a material weakness in internal controls over financial reporting identified in 2024, concluding controls were effective as of December 31, 2025.
Investor Verification Checklist
- Valuation Allowance Release: Verify the sustainability of the $30.2 million tax benefit and the assumptions regarding future U.S. taxable income.
- Cost Inflation: Monitor the trend in All-In Sustaining Costs (AISC), which increased significantly in 2025 across all operations (e.g., Fox Complex AISC rose to $2,506/oz from $1,980/oz in 2024).
- Production Guidance: Track Q1 and Q2 2026 production results against the lowered guidance for the Fox Complex and Gold Bar to assess the impact of lower-grade ore transitions.
- Debt Covenants: Review compliance with covenants in the new Convertible Notes and the amended Term Loan facility.
- Argentina Operations: Monitor the impact of Argentine inflation and currency controls on the cash flow and dividend repatriation from the San José mine (MSC).
- El Gallo Timeline: Confirm the start of mill construction in mid-2026 as a critical milestone for future revenue diversification.