Hemlo Mining Corp. Reports First Quarter 2026 Financial and Operating Results
Press Release
Toronto, Ontario, Canada – May 20, 2026 – Hemlo Mining Corp. (TSXV: HMMC) (OTCQX: HMMCF) (“Hemlo Mining” or the “Company”) is pleased to announce its financial and operating results for the first quarter ended March 31, 2026. The Company will host a conference call to discuss first quarter 2026 results on Thursday, May 21, 2026 at 9:00 AM Eastern Time.
(All amounts expressed in U.S. dollars unless otherwise stated)
Jason Kosec, President, CEO & Director of Hemlo Mining, commented: “Q1 was transformational for the Company, delivering our first full quarter as owner-operator of the Hemlo Gold Mine and establishing the operational platform for the year ahead. We delivered attributable gold1 production of 29,699 ounces, generating $186.3 million in revenue and net income of $22.1 million, or $0.07 per share. During the quarter, we completed the transition to an owner-operated model ahead of schedule, strengthened our executive and site teams, launched our 130,000-metre exploration drilling program, deployed $20.1 million across sustaining and growth capital2, executed a strategic royalty buyback, and fully repaid our Revolving Credit Facility. The scope and momentum of execution across the Company reinforce our conviction in the long-term value we are building at Hemlo.”
First Quarter Highlights:
Financial Highlights
- Revenue for the three months ended March 31, 2026 was $186.3 million mainly from 38,685 gold ounces sold at an average realized price2 of $4,923 per ounce.
- Net income for the three months ended March 31, 2026 was $22.1 million, or $0.07 per share, primarily due to gross profit of $73.2 million (calculated as revenue of $186.3 million less cost of sales of $113.1 million), partially offset by income tax expense of $23.6 million, net finance costs of $12.4 million, loss on revaluation of contingent consideration of $8.4 million and general and administrative expenses of $7.9 million.
- Earnings before interest, taxes, depreciation and amortization (“EBITDA”)2 for the three months ended March 31, 2026 was $86.6 million mainly due to revenues of $186.3 million, partially offset by mine operation expenses of $54.0 million, royalties expense of $30.5 million, loss on revaluation of contingent consideration of $8.4 million and general and administrative expenses of $7.9 million.
- Cash generated from operating activities for the three months ended March 31, 2026 was $87.9 million.
- Repaid $75.0 million outstanding under the revolving portion (“Revolving Credit Facility”) of the secured credit agreement (“Credit Agreement”), reducing the balance of the Revolving Credit Facility to nil in March 2026. The Revolving Credit Facility remains available to the Company for general corporate purposes and working capital needs.
- As at March 31, 2026, the Company held cash of $123.6 million.
Operating Highlights
- Attributable gold3 production for the three months ended March 31, 2026 totalled 29,699 ounces of gold at average recoveries of 95.6%.
- Attributable gold3 sold for the three months ended March 31, 2026 totalled 32,052 ounces of gold supplemented by finished goods at December 31, 2025.
- Cost of sales for the three months ended March 31, 2026 were $113.1 million. Site attributable cash cost per ounce sold4 and all-in sustaining cost per ounce sold4 for the three months ended March 31, 2026 were $1,385 per ounce and $1,805 per ounce, respectively.
- Continued strong safety performance, with no environmental non-compliances and no Lost Time Injury (“LTI”). Subsequent to the end of first quarter 2026, the Hemlo Mine received the prestigious John T. Ryan Trophy which is presented annually by the Canadian Institute of Mining, Metallurgy and Petroleum (“CIM”) in recognition of excellence in safety performance. At the end of first quarter 2026, LTI-free hours totalled 4,048,587 (1,033 total days).
- Successfully transitioned from an underground mining contractor workforce to an owner-operated workforce with 97% of the contractor workforce accepting positions with the Company as part of the transition.
- Commissioned two of the 21 planned pieces of new equipment during the quarter and filled an additional 42 positions to support operational optimization efforts in development and production for progressive increase in mine performance.
- 90% of 2026 production stopes have been developed and are part of the planned mining sequence.
- Rebuilt one of three primary crushers as part of the preventative maintenance program and additional investments will be made to support and de-risk future production growth.
- Initiated a 130,000 metre exploration drilling program with initial results from the South-Rim Zone that support the definition of a newly recognized, high-grade mineralized domain.
- Exploration drilling, trade-off studies, and ongoing optimization efforts will support an updated technical report planned for the second half of 2027.
Investment and Growth Highlights
- Continued to strengthen the management team with the appointment of several key executives across operations, corporate development and investor relations, and sustainability functions.
- Repurchased a 1.5% net smelter return royalty interest associated with the past-producing David Bell property, consolidating the Company’s interest over the Hemlo land package and improving economic leverage to potential exploration success and future production growth.
- Received conditional approval to list its common shares on the Toronto Stock Exchange (“TSX”) and graduate from the TSX Venture Exchange (“TSXV”). Final approval of the listing is subject to the Company fulfilling all of the requirements of the TSX, including receipt of all required documentation on or before July 14, 2026.
- Common shares commenced trading on the OTCQX® Best Market (“OTCQX”) in the United States under the symbol “HMMCF”.
Operating and Financial Highlights
| Three months ended March 31, | ||
| Hemlo Mine | Unit | 2026 |
| Williams | ||
| Ore mined | 000t | 229 |
| Waste mined | 000t | 45 |
| Total mined | 000t | 274 |
| Ore processed | 000t | 230 |
| Average grade | g/t | 3.37 |
| Gold produced | oz. | 24,635 |
| Sustaining capital expenditures1 | $’000s | 11,018 |
| Growth capital expenditures1 | $’000s | 7,688 |
| Interlake2 | ||
| Ore mined2 | 000t | 91 |
| Waste mined2 | 000t | 11 |
| Total mined2 | 000t | 102 |
| Ore processed2 | 000t | 92 |
| Average grade2 | g/t | 3.51 |
| Gold produced2 | oz. | 10,129 |
| Sustaining capital expenditures1,2 | $’000s | 1,367 |
| Recovery | % | 95.6 % |
| Total gold produced | oz. | 34,764 |
| Total gold sold | oz. | 38,685 |
| Attributable gold produced3 | oz. | 29,699 |
| Attributable gold sold3 | oz. | 32,052 |
| Unit Cost Analysis | ||
| Average realized price1 | $/oz. sold | 4,923 |
| Mining | $/t mined | 113.15 |
| Milling | $/t milled | 32.81 |
| Minesite G&A | $/t milled | 20.75 |
| Cost of sales (100%) | $/oz. sold | 2,924 |
| Total site cash cost (Attributable)1 | $/oz. sold | 1,385 |
| Total site AISC (Attributable)1 | $/oz. sold | 1,805 |
- This is a non-IFRS measure. For further information, refer to the “Non-IFRS Measures” section of this news release.
- Operating statistics are presented on a 100% basis. The Interlake claims are subject to a 50% net profits interest (“NPI”) royalty with Franco-Nevada Corporation.
- Attributable gold is calculated as 100% of gold from Williams and 50% of gold from Interlake.
| Three months ended March 31, | |||
| 2025 | |||
| Financial highlights | Unit | 2026 | (restated)3 |
| Gold produced (100%) | oz. | 34,764 | — |
| Gold produced (attributable)1 | oz. | 29,699 | — |
| Gold sold (100%) | oz. | 38,685 | — |
| Gold sold (attributable)1 | oz. | 32,052 | — |
| Average realized price2 | $/oz. sold | 4,923 | — |
| Revenues | $’000s | 186,265 | — |
| Net income (loss) | $’000s | 22,126 | (13) |
| Basic earnings (loss) per share | $/share | 0.07 | (0.00) |
| Cash generated from (used in) operating activities | $’000s | 87,899 | (25) |
| Cash flow generated from (used in) operating activities before working capital changes2 | $’000s | 54,427 | (13) |
| Cash used in investing activities | $’000s | (16,407) | — |
- Attributable gold is calculated as 100% of gold from Williams and 50% of gold from Interlake.
- This is a non-IFRS measure. For further information, refer to the “Non-IFRS Measures” section of this news release.
- As at December 31, 2025, the Company changed its presentation currency from Canadian dollars to U.S. dollars. The change in presentation currency is an accounting policy change and has been applied retrospectively with comparative figures restated for all periods presented.
| As at March 31, | As at December 31, | ||
| Financial position | Unit | 2026 | 2025 |
| Cash | $’000s | 123,572 | 131,956 |
| Net debt1 | $’000s | 26,428 | 93,044 |
| Working capital | $’000s | 57,828 | 110,688 |
- This is a non-IFRS measure. For further information, refer to the “Non-IFRS Measures” section of this news release.
Financial Overview
Prior to the fourth quarter of 2025, the Company was a shell company, with no active operations. The Company was previously an international energy company, but had disposed of all of its investments as of December 31, 2022, and was pursuing new investment opportunities. There were minimal operating activities. The Company completed the Hemlo Acquisition and related financings on November 26, 2025. The Company did not have any gold sales until the first quarter of 2026.
Revenue for the three months ended March 31, 2026 was $186.3 million mainly from 38,685 gold ounces sold at an average realized price5 of $4,923 per ounce.
Net income for the three months ended March 31, 2026 increased by $22.1 million compared to the comparative period, mainly due to gross profit of $73.2 million as the Company began selling gold produced from the Hemlo Mine in first quarter 2026. The Company also incurred income tax expense of $23.6 million, net finance costs of $12.4 million mainly comprised of accretion expense from the Precious Metals Purchase Agreement (“Streaming Arrangement”) with Wheaton Precious Metals Corp. (“Wheaton”) of $7.2 million and interest expense on the Credit Agreement of $5.7 million, loss on revaluation of the Contingent Consideration of $8.4 million and G&A expense of $7.9 million mainly comprising of share-based compensation expense of $4.4 million as the Company increased its corporate infrastructure compared to the comparative period, and professional fees of $1.6 million to support the Company’s activities as a public company, the Company’s planned up-listing to the TSX and the build out of the Company’s information technology environment and infrastructure.
Cash generated from operating activities for the three months ended March 31, 2026 was $87.9 million.
Cash used in investing activities for the three months ended March 31, 2026 was $16.4 million mainly related to capital expenditures of $20.1 million comprised of sustaining capital expenditures6 of $12.4 million driven by spending on underground mine development and infrastructure, mining fleet additions, and the tailings storage facility, with growth capital expenditures6 of $7.7 million largely reflecting mining fleet additions. Capital spending was partially offset by $4.6 million in the cash consideration recovered for the Hemlo Acquisition due to the settlement of the working capital adjustment.
Operations Overview
Safety
The Hemlo Mine continued its strong safety performance in first quarter 2026, with no environmental non-compliances and no LTI events recorded. At the end of first quarter 2026, LTI-free hours totalled 4,048,587 (1,033 total days). Subsequent to the end of first quarter 2026, the Hemlo Mine was awarded the prestigious 2025 John T. Ryan Trophy for Metal Mines for excellence in safety practices. The John T. Ryan Safety Trophies are presented annually by the CIM to recognize mining operations in Canada that achieve the lowest reportable injury frequencies in their respective categories during the previous calendar year.
People
A major achievement during the quarter was the successful transition of the Hemlo Mine from a contractor workforce to an owner-operated underground mining workforce, with 97% of contractors accepting positions with the Company. An additional 42 positions were filled during the period to support operational optimization and future production growth.
Mining
During first quarter 2026, mining rates were in line with expectations from historical performance under contractor workforce, resulting in 376,000 total tonnes mined, including 320,000 ore tonnes and 56,000 waste tonnes mined.
In first quarter 2026, major production areas mined included B-Zone (lower east and lower west), C-Zone (upper), and Interlake. Mine planning efforts are underway to convert stope sequencing from top-down to bottom-up in key areas, including C-Zone (lower), Interlake, and future mining of E-Zone to support material handling optimization. Exploration drift development and drilling is planned for E-Zone in 2026. Additional mine optimization work underway include ground support standards review to restart MacLean Bolting, improve performance and reduce costs. On the production side, work is underway on cycle-time optimization to reduce stope duration, minimize dilution and maximize mining recovery.
Development performance remained consistent during the transition to owner-operator and in line with expectations. In second quarter 2026, performance is expected to increase progressively with additional equipment and manpower.
While primary underground mining tasks have been transitioned to owner-operated mining, long-term partnerships with certain contractors will be maintained, specifically for a portion of underground development, Alimak mining method and production drilling.
The upgrade to the mining fleet continued to progress during the quarter with two of the 21 planned pieces of new equipment being commissioned in first quarter 2026. One longhole drill (that is already owned) will be restarting production drilling in second quarter 2026 and two additional jumbo crews are expected to be delivering metres by end of the third quarter. Currently, 90% of 2026 production stopes have been developed and are part of the planned mining sequence. During first quarter 2026, one of the primary crushers was rebuilt as part of the preventative maintenance program and additional investments will be made to support and de-risk future production growth.
Various maintenance activities were undertaken during the quarter, with the most significant tasks being the refurbishment of one of the underground crushers and the replacement of the production hoist cable, which was completed two months ahead of schedule. The Company also completed an evaluation of all existing equipment to support refurbishment, replacement, and fleet expansion for future production increases.
Improvement actions are in place to increase production, with the additional mining fleet coming online during the remainder of the year, the continued hiring of additional employees and the execution of improvements and efficiencies in operational planning. The Hemlo Mine plans to have seven jumbo drills and a similar number of bolters in operation by the end of 2026 to facilitate a marked increase in development rates for the mine that will open up several new mining areas. As in previous years, the Interlake zone is expected to contribute approximately 25% to 35% of the overall mine production.
Processing
Plant performance during first quarter 2026 was stable with average milling rate of approximately 180 tonnes per hour (“tph”) or 4,300 tonnes per day.
Ore processed in first quarter 2026 was 322,000 tonnes, with an average grade of ore milled of 3.41 g/t at a recovery of 95.6%. Attributable gold7 produced in first quarter 2026 was 29,699 ounces.
During first quarter 2026, semi-autogenous grinding (“SAG”) mills 1 and 2 achieved their designated throughput capacity of 220 tph and 180 tph, respectively. SAG 2 liner redesign was completed during first quarter 2026 and throughput capacity reached a maximum of 300 tph. Grind size and pH optimization were also implemented during first quarter 2026 which improved average recoveries from 93.5% to 95.6%. Processing optimization work will continue through the remainder of 2026.
Site Operating Costs
In first quarter 2026, total mining costs, before capitalized development costs, were $42.6 million, or $113.15 per tonne mined, processing costs were $10.5 million, or $32.81 per tonne processed, and total site G&A costs were $6.7 million, or $20.75 per tonne processed. Attributable gold7 sold for first quarter 2026 were 32,052 ounces, resulting in cash costs per ounce sold8 of $1,385 per ounce and attributable all-in sustaining costs per ounce sold8 of $1,805 per ounce.
The Company expects to provide 2026 operating and cost guidance in the second half of 2026.
Growth Update
In January 2026, the Company initiated a 130,000 metre exploration drilling program aimed at extending mine life, de-risking the near-term mine plan and identifying near-mine growth opportunities. The 2026 exploration drilling program is expected to serve as the foundation for an updated technical report planned for the second half of 2027.
Drilling Program Breakdown
Resource Conversion Drilling (70,000 metres): Targeting the conversion of Inferred to Indicated mineral resources to support reserve growth ahead of the updated technical study planned for the second half of 2027. Drilling will focus on multiple areas across the mine, with particular emphasis on the western portion of the operation — including C-Zone and the newly defined E-Zone — where significant Inferred resources remain open at depth. Mineralization proximal to historic workings represents an additional conversion opportunity, with successful conversion expected to extend mine life, increase operational flexibility, and improve mine economics.
High-Definition Drilling (30,000 metres): Focused on de-risking the short-term mine plan over the next two years by applying tighter drill spacing in areas scheduled for extraction within the next 24 months. The objective is to improve geological confidence, refine grade and tonnage estimates, and enhance operational predictability during the planned production ramp-up period.
Growth Drilling (30,000 metres): Testing new mineralized zones outside the current mineral resource footprint across four priority targets selected based on geological interpretation, structural continuity, proximity to existing infrastructure, and mineability. These targets have returned encouraging historical results but have not been systematically tested. Successful results are expected to support the addition of new Inferred Mineral Resources, with promising intercepts to be followed up immediately with targeted infill drilling to advance mineralization toward the Indicated category and reinforce the long-term scale potential of the Hemlo gold system.
Subsequent to quarter-end, the Company announced the first results from the Growth Drilling component of its 2026 exploration program, focused on the South-Rim Zone – a newly recognized high-grade mineralized domain hosted within the regional metasediments and located adjacent to active mining in C-Zone. The first 7 of 20 planned holes confirmed mineralization, with highlights including:
- Hole 7652606 intersected 16.07 g/t Au over 8.1 metres, including 59.67 g/t Au over 2.0 metres
- Hole 7652603 intersected 5.79 g/t Au over 11.0 metres, including 38.40 g/t Au over 0.9 metres
- Hole 7652604 intersected 6.04 g/t Au over 4.8 metres, including 36.20 g/t Au over 0.6 metres
The mineralization remains open along strike and down plunge. Refer to the Company’s news release dated May 14, 2026 for detailed drill results, images, and commentary. The Company will continue to release results from the drilling program throughout the remainder of 2026 and into 2027 as they become available.
Financial Statements and Management’s Discussion and Analysis
Hemlo’s unaudited interim condensed consolidated financial statements and management’s discussion and analysis as at and for the three months ended March 31, 2026, are available on the Company’s website at www.hemlomining.com and under the Company’s profile on SEDAR+ at www.sedarplus.ca. Hard copies of the financial statements are available free of charge upon written request to info@hemlomining.com.
Conference Call and Webcast
Hemlo will host a conference call and webcast on Thursday, May 21, 2026 at 9:00 AM Eastern Time to discuss first quarter 2026 results. Details for the conference call and webcast are included below.
Dial-In Numbers / Webcast:
Conference/Meeting ID: 827203073
North America Toll Free: +1 833-461-5787
International Toll: +1 585-542-9983
Canada Local: +1 365-657-4084
Webcast: https://events.q4inc.com/attendee/827203073
About Hemlo Mining Corp.
Hemlo Mining Corp. is a Canadian gold producer focused on operating and enhancing the Hemlo gold camp in northwestern Ontario. The Company’s flagship asset, the Hemlo Gold Mine, has produced approximately 25 million ounces of gold since 1985 from both underground and open pit operations. The Company’s fit-for-purpose strategy is centered on maximizing the value of the mine through improved operating efficiency, production growth, and mine life extension. Hemlo Mining is led by an experienced team with a track record of value creation in the global mining sector.
Contact Information
Jason Kosec, President, CEO and Director, +1 (250) 552-7424
Jonathan Awde, Executive Chairman, +1 (604) 761-5251
General Inquiries: info@hemlomining.com
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