Gold miner margin per ounce rises to $2,401 from $914

News Provided by USA News Group on behalf of Cerrado Gold Inc.

VANCOUVER, British Columbia, Aug. 25, 2026 (GLOBE NEWSWIRE) -- USA News Group News Commentary - Production growth is common in mining updates. Margin growth that outpaces it is not. Cerrado Gold Inc. (TSX.V: CERT) (OTCQX: CRDOF) (FRA: BAI0) ( www.cerradogold.com ) reported both in its second-quarter 2026 financial results, released August 18, 2026: gold equivalent production at its Minera Don Nicolás ("MDN") mine in Santa Cruz, Argentina rose to 15,415 ounces, up 35% from 11,437 ounces a year earlier, while the average realized margin per gold ounce sold climbed to $2,401, up from $914 in the same quarter last year — a 163% increase. Metal sales revenue more than doubled to $64.6 million from $29.6 million, and net income from operations rose to $9.2 million from $1.2 million. The results land alongside a cluster of corporate developments: a court injunction favouring the Company's Lagoa Salgada project in Portugal, an enlarged design for the Mont Sorcier iron project in Quebec, and the completed buyback of streaming obligations that had been layered onto both MDN and Lagoa Salgada. Companies mentioned: Cerrado Gold Inc. (TSX.V: CERT) (OTCQX: CRDOF) (FRA: BAI0), Pan American Silver Corp. (NYSE: PAAS) (TSX: PAAS), Barrick Mining Corporation (NYSE: B) (TSX: ABX), Champion Iron Limited (TSX: CIA) (ASX: CIA), Rio Tinto Group (NYSE: RIO) (LSE: RIO)

Key Takeaways

Q2 2026 gold equivalent production of 15,415 GEO, up 35% from 11,437 GEO in Q2 2025, at AISC of $1,933/oz — Adjusted EBITDA of $28.2 million and a cash position of $25.3 million at quarter end.

Average realized price per gold ounce sold rose to $4,184 from $2,684 a year earlier; average realized margin per gold ounce sold rose to $2,401 from $914 — a 163% increase — as the Company now runs an unhedged gold position.

2026 annual production guidance of 50,000-60,000 GEO reiterated, with management indicating results are increasingly likely to land at the higher end as underground development at MDN accelerates into the second half of the year.

A new Preliminary Economic Assessment and Mineral Resource Estimate at MDN is targeted for Q1 2027, incorporating results from an active four-rig exploration program and recently acquired adjacent properties, and is expected to demonstrate enhanced mine life and a growing production profile.

In June 2026, a Portuguese court granted Cerrado's subsidiary an injunction suspending the effect of an unfavourable environmental permitting opinion at the Lagoa Salgada polymetallic project; the underlying legal proceedings remain ongoing, and completion of the Optimized Feasibility Study has been pushed out pending permitting clarity.

Subsequent to quarter end, on July 17, 2026, Cerrado closed the repurchase of Sprott Streaming's metals purchase agreements on both MDN and Lagoa Salgada for aggregate consideration of approximately $31.34 million, eliminating both streams from the balance sheet.

Where the Margin Expansion Came From

The headline production number — 15,415 GEO in Q2 2026 versus 11,437 GEO in Q2 2025 — tells only part of the story. Heap leach production rose to 9,981 GEO as irrigation issues that had constrained recoveries in prior quarters subsided and more crushed material reached the pads, aided by recent improvements to the crushing circuit; silver recoveries at the heap leach operation improved sharply, from 15% to 76% year-over-year. The high-grade CIL plant contributed 5,434 GEO, processing a blend of stockpile material and increasing volumes of underground ore. Total cash costs per ounce sold were $1,783, roughly flat with $1,770 a year earlier, as the initial effects of cost-cutting measures were offset by higher labour costs in Argentina.

What moved the margin was price, not cost. Average realized price per gold ounce sold reached $4,184, up from $2,684 in Q2 2025, while total cash costs per ounce sold were essentially unchanged. That combination — flat costs against a sharply higher realized price, now unhedged — pushed average realized margin per gold ounce sold from $914 to $2,401. Metal sales revenue of $64.6 million against cost of sales of $41.6 million produced gross margin from mining operations of $22.9 million for the quarter, more than triple the $6.2 million recorded a year earlier.

“ Positive results for the second quarter continued to benefit from recent operational improvements at MDN, highlighting growing production and strong cash flows for the quarter,” said Mark Brennan, CEO and Chairman. “We expect this to be sustained going forward, given the previously discussed operational upgrades, sustained high gold prices, and our unhedged gold position.”

The Underground Story Behind the Guidance

Cerrado reiterated its 2026 annual production guidance of 50,000 to 60,000 GEO, and management struck an increasingly confident tone on where within that range the year will land. The mechanism is underground development at MDN: work that reduced ore available for immediate processing during the quarter is expected to unlock greater ore volumes and improve head grades to the plant over the balance of the year, as underground workings follow the ore zone deeper beneath the current pit. A new underground drill rig arrived on site in July, and all four of the Company's exploration drill rigs remained active during the quarter, with underground drilling recently commenced.

The near-term payoff is a Preliminary Economic Assessment and updated Mineral Resource Estimate targeted for Q1 2027, intended to incorporate both the ongoing exploration results and recently acquired properties adjacent to MDN. Management describes this as expected to demonstrate an enhanced mine life and a growing production profile — in effect, a re-rating event for the flagship asset's underlying resource base, contingent on assay turnaround from an on-site lab the Company is working to certify to shorten result times.

A Legal Win in Portugal, With Caveats

At the Lagoa Salgada polymetallic VMS project — an 80%-owned, zinc-copper-lead-tin-silver-gold deposit on Portugal's Iberian Pyrite Belt, 80 km from Lisbon — permitting uncertainty had slowed workflows through the period. In June 2026, a Portuguese court ruled in favour of Cerrado's Portuguese subsidiary and granted an injunction suspending the effects of an unfavourable opinion relating to environmental permitting. That is a real, near-term positive, but the Company is careful to note that legal proceedings relating to the underlying principal case remain ongoing, and as a result the timing of the Optimized Feasibility Study has been pushed out pending greater permitting clarity. The injunction removes an immediate obstacle without resolving the fundamental question.

Mont Sorcier Gets Bigger, Not Faster

Cerrado's 100%-owned Mont Sorcier project in Quebec — a high-purity, 67% iron, direct-reduction-quality iron ore deposit — saw its design scope increase during the quarter: the project is now being designed as an 8 million-tonne-per-annum concentrate operation, up from 5 Mtpa in the original PEA, reflecting strong demand for the low-silica, low-alumina concentrates used in direct reduction iron (DRI) and premium pellet feed, which the Company describes as the fastest-growing segments of the iron ore market. Development is planned in two phases — an initial 4 Mtpa followed by a second 4 Mtpa expansion roughly three years after start-up.

That larger scope comes with a later timeline. The Bankable Feasibility Study, previously guided for completion sooner, is now targeted for H1 2027, as the Company works through trade-off studies aimed at optimizing project economics and reducing capital and operating costs despite industry-wide inflation. A targeted definition drill program is planned for Q3 2026 to test converting a portion of currently Inferred Resources east of the planned pit — shallower material that would reduce stripping and tailings costs — into Measured Resources ahead of an optimized mine plan. The Environmental and Social Impact Assessment remains on track for a Q2 2027 filing, though the Company flags some risk to that timing even as it notes recent policymaker comments favouring faster permitting in Canada.

Cleaning Up the Balance Sheet

Subsequent to quarter end, on July 17, 2026, Cerrado closed the repurchase of two Sprott Streaming metals purchase and sale agreements — one on MDN, one on Lagoa Salgada, the latter including a US$19 million secured note — for aggregate consideration of approximately $31.34 million. Removing both streams simplifies the capital structure across the Company's two most active development assets and follows a quarter in which cash grew to $25.3 million and operating cash flow before working-capital movements reached $20.0 million, up from $5.6 million a year earlier. Separately, Cerrado also announced a proposed two-year investor relations and strategic marketing engagement with ENGAGE360 at C$7,500 per month, subject to TSX Venture Exchange approval, aimed at raising the Company's investor profile.

The Highly Visible Names Investors Are Watching

Pan American Silver Corp. (NYSE: PAAS) (TSX: PAAS)

Pan American is one of the largest primary silver producers in the Americas, with a long operating history in Argentina and a broader portfolio spanning Mexico, Peru, Bolivia and Canada. The company enters 2026 with a strengthened liquidity position of roughly $2.07 billion and guidance for increased silver production. Pan American's scale in the same Argentine and broader Latin American silver-gold space Cerrado operates in makes it a useful benchmark for what a well-capitalized regional operator's balance sheet and production profile look like.

Barrick Mining Corporation (NYSE: B) (TSX: ABX)

Barrick operates the Veladero gold mine in San Juan Province, Argentina — the same country as Cerrado's MDN operation — and has committed US$271 million through 2027 to extend Veladero's mine life to 2035 at an average annual production rate of approximately 400,000 ounces. Barrick's continued, large-scale investment in Argentine gold production is a direct signal of confidence in the jurisdiction Cerrado's flagship asset operates within, from one of the world's largest gold producers.

Champion Iron Limited (TSX: CIA) (ASX: CIA)

Champion Iron operates the Bloom Lake high-purity iron ore complex in Quebec's Labrador Trough and, during its most recent quarter, achieved initial production of direct-reduction-quality iron ore from its DRPF project, with initial shipment expected in the following quarter. Champion is the most direct Canadian comparator to Mont Sorcier's ambitions: a producing, high-purity, DR-grade iron ore operation in the same province, illustrating both the demand Cerrado is targeting and the operational path from concentrate upgrade project to shipped DR-grade product.

Rio Tinto Group (NYSE: RIO) (LSE: RIO)

Rio Tinto is one of the world's largest iron ore producers, reporting its strongest first-half Pilbara production since 2018 and a 5% year-over-year increase in H1 2026 iron ore sales to 157.7 million tonnes, at an average achieved price of $85.2 per wet metric tonne. As a global price-setter in iron ore, Rio Tinto's results and commentary on premium DR-grade and low-impurity product demand provide broad market context for the pricing environment Mont Sorcier's high-purity concentrate is designed to sell into, at a scale many multiples larger than Cerrado's project.

These companies are referenced to illustrate the gold, silver and iron ore sectors only and do not imply any partnership, endorsement, affiliation, or comparable financial performance with Cerrado Gold Inc.

What to Watch

The most consequential near-term catalyst is the assay flow from MDN's underground and near-mine exploration program, feeding toward the targeted Q1 2027 Preliminary Economic Assessment and Mineral Resource Estimate — the event management has framed as likely to demonstrate an enhanced mine life and growing production profile. Second-half production trends at MDN, particularly whether underground development translates into the higher grades and volumes management has guided toward, will determine whether full-year output lands at the top of the 50,000-60,000 GEO guidance range. At Lagoa Salgada, the outcome of the ongoing principal legal proceedings on environmental permitting — not just the June injunction — will determine when the Optimized Feasibility Study can be completed. And at Mont Sorcier, the Q3 2026 definition drill program testing conversion of Inferred to Measured Resources, together with the trade-off studies on product quality and capital costs, will shape the Bankable Feasibility Study now targeted for H1 2027.

CONTINUED… Learn more about Cerrado Gold Inc. at: www.cerradogold.com

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Article Sources

[1] Cerrado Gold Inc. — “Cerrado Gold Announces Second Quarter 2026 Financial Results” (August 18, 2026; Q2 GEO 15,415 vs. 11,437 Q2 2025; AISC $1,933/oz; Adjusted EBITDA $28.2M; cash $25.3M; average realized price $4,184/oz vs. $2,684/oz; average realized margin $2,401/oz vs. $914/oz; 2026 guidance 50,000-60,000 GEO reiterated; PEA/MRE targeted Q1/27; Lagoa Salgada injunction June 2026; Mont Sorcier design increased to 8 Mtpa; Sprott Streaming repurchase ~$31.34M closed July 17, 2026; ENGAGE360 IR agreement; QP Andrew Croal, P.Eng.; TSX.V: CERT, OTCQX: CRDOF, FRA: BAI0).

[2] Pan American Silver Corp. — 2026 guidance and liquidity position (~$2.07B); NYSE: PAAS, TSX: PAAS.

[3] Barrick Mining Corporation — Veladero Mine, San Juan Province, Argentina; US$271M investment through 2027 to extend mine life to 2035; 2026 company-wide gold production guidance 2.90-3.25 Moz; NYSE: B, TSX: ABX.

[4] Champion Iron Limited — Q1 FY27 results (production 3.9 Mwmt; revenue C$357M; EBITDA C$33M); DRPF project initial DR-grade production; TSX: CIA, ASX: CIA.

[5] Rio Tinto Group — H1 2026 results (iron ore sales 157.7 Mt, up 5% YoY; average achieved price $85.2/wmt); Q2 2026 Pilbara sales up 7% YoY; NYSE: RIO, LSE: RIO.

Cerrado Gold Inc. | www.cerradogold.com

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Qualified Person and Financial Disclosure Note. The scientific and technical information in this article is derived from Cerrado Gold Inc.'s August 18, 2026 news release, which was reviewed and approved by Andrew Croal, P.Eng., Chief Technical Officer for Cerrado Gold and a Qualified Person as defined under NI 43-101, and should be reviewed in full together with the Company's financial statements and MD&A filed on SEDAR+. Adjusted EBITDA, operating cash flow before movements in working capital, total cash costs, and AISC are non-IFRS performance measures that may not be comparable to similar measures used by other issuers and should not be considered in isolation from measures prepared in accordance with IFRS. Historical mineral resource and reserve figures referenced for Mont Sorcier and MDN are as previously disclosed by the Company; no new resource or reserve estimate is contained in this article, and the Preliminary Economic Assessment and Mineral Resource Estimate referenced for MDN, and the Bankable Feasibility Study referenced for Mont Sorcier, are planned but not yet complete. No production decision has been made at Lagoa Salgada, and environmental permitting there remains subject to ongoing legal proceedings.

Cautionary Note Regarding Forward-Looking Statements. This publication may contain forward-looking statements, including statements regarding future production guidance and its likely position within the guided range; expectations regarding exploration success, resource expansion and the timing and outcome of the planned PEA and Mineral Resource Estimate at MDN; anticipated timing of the Bankable Feasibility Study at Mont Sorcier and the Optimized Feasibility Study at Lagoa Salgada; the anticipated outcome of ongoing legal proceedings relating to environmental permitting at Lagoa Salgada; anticipated timing of the ESIA filing for Mont Sorcier; expected future costs, cash flows, and gold and iron ore prices; and the anticipated phased development of Mont Sorcier. Forward-looking statements are not guarantees of future performance and involve known and unknown risks and uncertainties, including commodity price, permitting, regulatory, operational, financing, labour cost, and jurisdictional risks in Argentina, Portugal and Canada. Actual results may differ materially from those projected.

Cautionary Note Regarding Referenced Companies. References to Pan American Silver Corp., Barrick Mining Corporation, Champion Iron Limited and Rio Tinto Group are provided solely as market and sector context. Those companies are not peers, competitors, or financial comparables of Cerrado Gold Inc., and differ substantially in size, stage, capitalization, revenue, operations, commodity exposure and business model. Their results and share performance describe those companies only, are not indicative of Cerrado Gold Inc.'s prospects or results, and must not be relied upon in evaluating the profiled company. The gold, silver and iron ore sectors have been volatile. No partnership, affiliation, or endorsement is implied.

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August 25, 2026 - 5:43 AM PDT

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