Alamos Gold (NYSE:AGI) executives used the company’s fourth-quarter 2025 earnings call to outline record financial results, near-term operational improvement plans after weather-related disruptions, and a longer-term growth strategy centered on the Island Gold District expansion and other development projects.
2025 results: record revenue and free cash flow despite operational setbacks
President and CEO John McCluskey said 2025 production totaled 545,000 ounces, coming in below guidance due to “severe weather late, in late December” and other challenges at the company’s Canadian operations. He said costs were also above annual guidance, reflecting the same factors.
Financial details: higher realized prices, hedge costs, and capital spending
CFO Greg Fisher reported fourth-quarter gold sales of 142,000 ounces at an average realized price of $3,998 per ounce, generating record quarterly revenue of $575 million. For the full year, the company sold 531,000 ounces at a realized price of $3,372 per ounce, with revenue rising 34% from 2024 to a record $1.8 billion.
Fisher said full-year total cash costs were $1,077 per ounce and all-in sustaining costs (AISC) were $1,524 per ounce, both above annual guidance due to higher fourth-quarter costs and temporary challenges in Canada.
Operating cash flow before changes in non-cash working capital was $285 million in the fourth quarter, or $0.68 per share. Fisher said this figure was reduced by $63 million, or $0.15 per share, due to cash used to eliminate legacy Argonaut hedges prior to maturity. For the full year, operating cash flow before working capital changes rose 27% to a record $924 million, or $2.20 per share.
Net earnings in the fourth quarter were $435 million, or $1.03 per share, which included an after-tax gain of $227 million from the sale of non-core assets, a $35 million loss on commodity hedge derivatives, and $16 million of other adjustments. Adjusted net earnings were $228 million, or $0.54 per share. Full-year adjusted net earnings were $587 million, or $1.40 per share.
Capital spending totaled $158 million in the fourth quarter, including $50 million of sustaining capital, $97 million of growth capital, and $11 million of capitalized exploration. Full-year capital expenditures were $507 million, including $318 million of growth capital. Fisher said the company generated record free cash flow of $157 million in the fourth quarter and $352 million for the full year.
Shareholder returns: dividend raised 60% as cash balance grows
Fisher said Alamos returned $81 million to shareholders in 2025—double the amount returned in 2024—through $39 million in share repurchases (1.3 million shares) and $42 million in dividend payments. Management announced a 60% increase in the dividend beginning in the current quarter.
On hedges, Fisher said the company paid down $50 million of debt and eliminated half of the 2026 hedges inherited from Argonaut Gold. He said Alamos has repurchased and eliminated 230,000 of the 330,000 ounces hedged by Argonaut prior to maturity, and intends to look for opportunities to eliminate the remaining 100,000 ounces across the second half of 2026 and first half of 2027.
Fisher said the cash position increased 90% from the end of 2024 to $623 million, while debt was reduced to $200 million.
In the Q&A session, McCluskey said the company has historically balanced dividends and buybacks and remains “very opportunistic” regarding repurchases. He added that while Alamos is in a heavy capital spending period to support growth, strong gold prices and free cash flow supported the dividend increase, and investors “should expect more dividends to come.”
Operations: Island Gold ramp and Magino processing improvements
COO Luc Guimond said fourth-quarter production from the Island Gold District was 60,000 ounces, down 10% from the prior quarter due to lower underground mining rates and reduced mill throughput. Full-year production from the district totaled 250,400 ounces, up 33% year over year but slightly below the low end of revised guidance.
Guimond said underground mining rates averaged 1,160 tons per day in the fourth quarter and were impacted by additional rehabilitation work following an October seismic event, plus severe winter weather in late December that prevented delivery of supplies and site access, leading to a three-day stand-down of underground operations. The Island Gold mill averaged 1,100 tons per day in the quarter, consistent with underground mining rates.
He said rehabilitation work to support the Phase 3+ shaft expansion ramp-up is substantially complete, and mining rates are expected to average 1,400 tons per day in the first quarter of 2026 and gradually increase to 2,000 tons per day by the fourth quarter of 2026. Open pit performance was described as strong, with ore mining rates averaging 16,600 tons per day in the fourth quarter and 15,000 tons per day for the full year, in line with guidance.
At Magino, Guimond said milling averaged 8,625 tons per day in the fourth quarter, a modest improvement from the third quarter but below expectations, in part due to weather disruptions late in the quarter. He said initiatives in the first quarter of 2026 are expected to support a substantial improvement in milling rates in the second half of the year.
Among steps to improve Magino processing rates, Guimond said Alamos added a temporary crusher to provide supplemental crushed ore feed downstream from the existing secondary crusher, targeting milling rates of 10,000 tons per day by the end of the second quarter. He also cited work with third-party specialists to optimize reliability and a restructuring of maintenance and mill operating management teams to provide constant senior-level oversight.
For 2026, Guimond said Island Gold District production is expected to increase 24% to between 290,000 and 330,000 ounces, driven by higher underground mining rates and improved Magino milling.
Growth pipeline and exploration: reserves rise to 16 million ounces
McCluskey pointed to updated three-year guidance calling for a 46% increase in production and roughly 20% lower AISC by 2028. He also discussed a longer-term plan to approach 1 million ounces of annual production by the end of the decade, supported by the Island Gold District expansion and bringing Lynn Lake into production by 2029.
Management detailed an Island Gold District expansion study envisioning milling rates of 20,000 tons per day supported by 3,000 tons per day from underground and 17,000 tons per day from the open pit. McCluskey said that following completion in 2028, annual production from the district is expected to average 534,000 ounces over the initial 10 years at mine-site AISC of $1,025 per ounce. He cited an after-tax net present value of $8.2 billion at $3,200 per ounce gold and $12 billion at $4,500 per ounce.
On exploration, VP Scott Parsons said year-end 2025 mineral reserves increased 32% to 16 million ounces, marking the seventh consecutive year of growth. He said the increase was mainly driven by the Island Gold District, which added nearly 4 million ounces in 2025, including a 125% increase in underground reserves to 5.1 million ounces and a 56% increase in open pit reserves to 3.1 million ounces. Parsons said inferred resources declined 63% due to conversion of Island Gold District resources to reserves.
Parsons said Alamos increased its 2026 exploration budget to nearly $100 million, up 37% from 2025. In the Q&A, he discussed Young-Davidson exploration targets, including hanging wall mineralization in different lithologies where higher grades were associated with conglomerate units, and a “South Syenite” target located about 300 meters south of the main syenite-hosted reserves.
Also during Q&A, Guimond discussed development progress at the PDA project, including establishing two portal entrances and advancing processing plant construction. He said earthworks have been largely completed for key mill components, long-lead items have been procured, and the project was tracking “on schedule, and certainly on budget” for mid-2027 initial production.
About Alamos Gold (NYSE:AGI)
Alamos Gold Inc is a Canadian-based intermediate gold producer engaged in the exploration, development and operation of mining projects in North America. Its principal activities include the acquisition, exploration and development of gold-bearing properties, and the management of operating mines. The company focuses on sustainable production practices and maintains a portfolio that spans both producing assets and advanced-stage development projects.
Alamos Gold operates multiple open pit and underground mines, including the Young-Davidson and Island Gold mines in Ontario, Canada, and the Mulatos mine in Sonora, Mexico.
