Dundee Precious Metals (TSE:DPM) reported higher third-quarter revenue and adjusted earnings as stronger metal prices and production from its Vareš mine helped offset the closure of Ada Tepe in July.
The company produced approximately 96,000 gold equivalent ounces during the quarter and generated $179 million in free cash flow. President and CEO David Rae said DPM remains on track to meet its 2026 production guidance for a 12th consecutive year.
Vareš, in Bosnia and Herzegovina, reached commercial production in August ahead of schedule. The mine is expected to reach its full production run rate by year-end, although a recent court decision has prompted a review of challenged acts related to the concession.
Revenue and cash flow rise
Third-quarter revenue rose 17% from a year earlier to $312 million, while adjusted net earnings increased 12% to $144 million, or $0.66 per share, Chief Financial Officer Navin Dyal said. The gains reflected higher realized metal prices and increased gold equivalent ounces sold from Vareš, which was acquired in September 2025.
Operating cash flow was $191 million, up $7 million from a year earlier. Free cash flow rose $32 million to $179 million. DPM returned $81 million to shareholders through buybacks and dividends during the quarter, equivalent to 45% of free cash flow, Rae said.
The company’s quarterly all-in sustaining cost was $1,580 per gold equivalent ounce sold, compared with an average realized gold price of $4,314 per ounce. Dyal said DPM remained on track to meet its full-year cost guidance while monitoring variables including metal prices, exchange rates and energy costs.
DPM ended the quarter with $839 million in cash, no debt and a $400 million undrawn revolving credit facility. Through Nov. 11, it had repurchased approximately five million shares during 2026 for an aggregate cost of about $198 million.
Vareš ramp-up and court review
Vareš produced approximately 44,000 gold equivalent ounces in the third quarter at an all-in sustaining cost of $767 per ounce sold. Rae noted that the cost reflected the capitalization of certain pre-commercial production expenses and said it was expected to rise over the balance of the year.
The mine is on track to reach an annualized processing rate of 850,000 tons by year-end and is expected to exceed the high end of its 2026 production guidance, Rae said.
Addressing an Oct. 1 Constitutional Court decision in Bosnia and Herzegovina, Rae said operations had continued normally and that the decision did not terminate or suspend the Vareš concession agreement. He said the court ordered a six-month period for authorities and the Attorney General to review challenged acts for compliance with the country’s law on the temporary prohibition of disposal of state property.
DPM is engaging with state, federation and cantonal authorities and will update the market on material developments, Rae said.
Exploration and project plans
At Chelopech, DPM produced approximately 50,000 gold equivalent ounces in the quarter and remained on track to meet annual guidance. The company expects the nearby Block 250 prospect, previously called the Wedge Zone, to increase production and extend the mine’s life, with first production targeted for late 2028. An initial mineral resource estimate is expected by year-end.
At Brevene Porphyry South, Rae said drilling had confirmed that the copper-gold system extends onto the Chelopech mine concession. DPM has shifted drilling there following the end of the Brevene exploration license period in September. The company is targeting an initial resource estimate in the second half of 2027 and a preliminary economic assessment in the first half of 2028.
In Serbia, DPM continues engineering and procurement for Čoka Rakita, though Rae cautioned that administrative and regulatory decisions could take longer as a new government is formed following the October parliamentary election. The company also expanded its 2026 drilling program in the area by 12,000 to 15,000 meters and expects an updated Dumitru Potok resource estimate by the end of the first quarter of 2027.
Dyal said DPM updated its 2026 spending guidance to support exploration and development. Exploration expenses are now expected to be $75 million to $80 million, while Vareš growth capital expenditure guidance was reduced to $90 million to $100 million following the earlier-than-planned start of commercial production.
About Dundee Precious Metals (TSE:DPM)
DPM Metals Inc. is a Canadian-based international gold mining company with operations and projects located in Bulgaria, Bosnia and Herzegovina, Serbia and Ecuador. The Company’s purpose is to unlock resources and generate value to thrive and grow together. Our strategic objective is to become a mid-tier precious metals company, which is based on sustainable, responsible and efficient gold production from our portfolio, the development of quality assets, and maintaining a strong financial position to support growth in mineral reserves and production through disciplined strategic transactions.
