Fresnillo Highlights ‘Record 2025 Financial Performance’ But Shares Dip

Fresnillo (LON: FRES) saw its share price decline despite announcing record financial results for the year ended December 31, 2025.

Adjusted revenue surged 27.6% to US$4.6 billion, driven by higher precious metal prices. EBITDA saw an impressive 80.7% increase, reaching US$2.8 billion. The company proposed a final ordinary dividend above its traditional policy, bringing total shareholder distributions to US$950.0 million, or 128.92 US cents per share.

Silver production, however, fell 13.5% to 48,723 kOz, while gold production decreased 5.0% to 600,287 Oz. This production dip seemingly tempered investor enthusiasm, overshadowing the strong financial gains.

The substantial dividend, exceeding the standard 50% payout ratio, signals management's confidence in the company's financial health and future prospects. The dividend was made possible due to a strong cash position.

Driver Breakdown:

• Precious Metal Prices: Higher prices significantly boosted revenue and profitability.
• Operational Efficiency: Cost management and structural improvements supported margin expansion.
• Strategic Acquisition: The acquisition of Probe Gold enhances the company's resource base and growth potential.

Octavio Alvídrez, CEO, stated, “I am pleased to report a record financial performance in 2025, as Fresnillo continued to benefit from a high precious metals price environment, combined with our ongoing focus on operational consistency.”

Fresnillo's exploration expenses increased by 6.4% to US$173.5 million, reflecting the company's focus on future growth. The acquisition of Probe Gold, completed in Q1 2026, adds 10 million gold ounces to Fresnillo's resource base, demonstrating a commitment to expanding its asset portfolio.

Silver resources decreased by 8.5% due to the implementation of the Reasonable Prospects for Eventual Economic Extraction (RPEEE) principle. Gold resources increased by 14.3%, primarily driven by higher gold prices at Herradura and the Lucerito exploration project.

Attributable silver production for 2026 is expected to be in the range of 42.0 to 46.5 moz, while gold production is projected to be between 500 and 550 koz. Capex for 2026 is anticipated to be approximately US$765 million, focused on mining works, sustaining capex, and optimisation projects.