Fortuna Mining Reports Strong Q2 2024 Performance with Increased Income and Cash Flow
Fortuna Mining Corp. has released its financial and operating results for the second quarter of 2024, showcasing substantial growth in net income and operational performance. The company reported an attributable net income of $40.6 million, or $0.13 per share, marking an increase from $26.3 million, or $0.09 per share, in the first quarter of 2024. Adjusted attributable net income reached $30.4 million, or $0.10 per share, compared to $26.7 million, or $0.09 per share, in the previous quarter.
The company generated $93.0 million, or $0.30 per share, in cash flow from operations before working capital changes. This is up from $84.3 million, or $0.28 per share, in the first quarter. Free cash flow from ongoing operations also increased to $38.6 million, compared to $12.1 million in Q1 2024.
Fortuna issued convertible notes (referred to as the "2024 Notes") for gross proceeds of $172.5 million, which were used in part to fully repay $125.0 million of its outstanding revolving credit facility.
By the end of the quarter, the company’s total net debt was $66.5 million, with a total net debt to adjusted EBITDA ratio of 0.2:1. Liquidity stood at $355.6 million as of June 30, 2024, up from $212.7 million at the end of the first quarter.
In terms of operations, Fortuna produced 116,570 gold equivalent ounces, an increase from 112,543 ounces in the first quarter. Gold production was 92,716 ounces, up from 89,678 ounces, while silver production decreased to 990,574 ounces from 1,074,571 ounces. The consolidated cash costs per ounce of gold equivalent sold were $988, compared to $879 in Q1 2024, but adjusting for the San Jose mine, which is mining its last year of mineral reserves, cash costs were $858. Consolidated all-in sustaining costs (AISC) per ounce of gold equivalent sold were $1,656, up from $1,495, with an adjusted AISC of $1,584 when excluding San Jose.
Notably, the company recorded zero lost-time injuries and zero total recordable injuries in the quarter, emphasizing its commitment to safety.
On the growth and development front, Fortuna reported significant drilling results at its Kingfisher prospect at the Seguela Mine, intersecting 23.7 grams per ton (g/t) of gold over 17.8 meters. Exploration at the Diamba Sud project also showed promising results, with an intersect of 31.3 g/t gold over 12 meters at the Karakara prospect.
CEO Jorge Ganoza highlighted the company's strong cash flow performance and financial flexibility, stating, "We anticipate our free cash flow to increase further in the second half of the year as we conclude a heavy sustaining capex phase in the third quarter with the completion of the Lindero leach pad expansion project."
He emphasized that the issuance of $172.5 million in convertible notes has strengthened Fortuna’s balance sheet, providing greater financial flexibility for strategic initiatives. Ganoza also noted the ongoing value creation through exploration, with the Kingfisher prospect at Seguela showing promising potential for resource definition by year-end.
