Fortuna Mining (NYSE:FSM) reported second-quarter 2026 results marked by $380 million in sales, $200 million in adjusted EBITDA and $85.7 million in free cash flow from ongoing operations, while advancing its Séguéla expansion in Côte d’Ivoire and Diamba Sud development project in Senegal.
The company produced 72,217 gold equivalent ounces during the quarter and 145,089 gold equivalent ounces during the first half, which President and Chief Executive Officer Jorge Alberto Ganoza said keeps Fortuna on track to meet its full-year production guidance.
Average realized gold prices were $4,447 per ounce, up 34% year over year but down from $4,884 per ounce in the first quarter. Consolidated cash costs were $1,034 per gold equivalent ounce, compared with $951 per ounce in the prior quarter, while all-in sustaining costs, or AISC, rose to $2,157 per ounce from $2,107 per ounce.
Growth projects advance in West Africa
Management said the Séguéla plant expansion and Diamba Sud project are expected to provide the basis for approximately 60% growth in annual production by mid-2028, supporting Fortuna’s objective of producing gold at an annual rate exceeding 500,000 ounces.
At Diamba Sud, Chief Operating Officer for West Africa David Whittle said the feasibility study outlines average annual gold production of 158,000 ounces during the first four years of operations and a 9.4-year mine life. The project’s environmental and social impact assessment has been approved, and discussions with the Senegalese government are continuing as Fortuna works toward final permitting.
Whittle said the feasibility study supports a potential final investment decision in the second half of 2026. Chief Executive Officer Ganoza said the company is also pursuing additional landholdings around Diamba Sud, which he described as a district-scale opportunity in a prolific West African gold belt.
Fortuna’s board approved a $109 million, 30% process-plant expansion at Séguéla. Together with the Somba underground project, the expansion is expected to support average annual production of more than 200,000 ounces of gold over the next decade, according to Whittle. The expansion will increase annual plant capacity from 1.75 million tonnes to 2.3 million tonnes.
The initial $48 million underground budget covers portal preparation, equipment purchases, team development and related facilities, Ganoza said. It does not include later mine-development spending. Underground development is expected to begin in the second quarter of 2027, while the broader plant expansion is expected to be delivered in the second or third quarter of 2028.
Séguéla produced 41,683 ounces of gold during the second quarter, in line with its mine plan. Cash costs were $676 per ounce and AISC was $1,765 per ounce, broadly consistent with the previous quarter. The mine commissioned a six-megawatt solar plant and is evaluating an expansion of solar capacity to 10 megawatts with no capital-cost implication to Fortuna, Whittle said.
Latin American operations remain on plan
At the Lindero mine in Argentina, Fortuna produced 20,129 ounces of gold in the quarter, broadly in line with first-quarter output. Chief Operating Officer for Latin America Cesar Velasco said ore placement, average gold grade and contained gold ounces placed on the leach pad improved from the first quarter.
Lindero’s cash costs increased to $1,459 per ounce from $1,208 per ounce in the first quarter, driven by temporary crusher-related costs, equipment rentals, alternative crushing arrangements, Argentine inflation and a stronger peso. AISC rose to $2,265 per ounce from $1,783 per ounce.
Velasco said the second quarter represented the expected AISC peak at Lindero. With most reliability work completed, improved crusher availability, higher stacking rates and higher scheduled grades are expected to support better production and lower unit costs in the second half.
The operation’s solar facility supplied about 26% of Lindero’s power requirements during the first half, reducing diesel consumption by approximately 2.2 million liters and providing an estimated $3.2 million in energy savings at average costs, according to the company.
Caylloma in Peru produced 9,700 gold equivalent ounces during the quarter, up from the first quarter as throughput improved. Cash costs declined to $27.80 per silver equivalent ounce from $30.30, while AISC was $44.90 per silver equivalent ounce, similar to the prior quarter. The tailings storage facility expansion was 28% complete as of June 30, management said.
Capital returns and cost outlook
Fortuna ended the quarter with $606.7 million in cash and cash equivalents and a net cash position of $434.2 million after financial debt. Total liquidity was approximately $756 million, Ganoza said.
The company spent $82 million repurchasing shares during the quarter under its normal course issuer bid. Year to date, Fortuna has repurchased 10.8 million shares for $106 million, representing about 41% of free cash flow from ongoing operations. Ganoza said the second-quarter buyback level was a historical peak and that future repurchases would likely be more measured while the company prioritizes organic growth projects and exploration.
Free cash flow from ongoing operations declined from $174 million in the first quarter to $85.7 million, primarily because Fortuna paid $79.3 million in income taxes during the quarter and increased capital expenditures to $67.9 million. Of that spending, $36.6 million was sustaining capital and $31.3 million was directed toward growth initiatives.
Chief Financial Officer Luis Dario Ganoza said AISC included roughly $115 per ounce of one-time costs related to primary crusher refurbishment at Lindero and contractor mobilization at Séguéla. Management said those costs are not expected to continue into the second half, with lower costs anticipated particularly in the third quarter. However, the company identified diesel prices, royalties tied to metal prices and macroeconomic conditions in Argentina as external factors that could affect full-year costs.
Fortuna also disclosed a fatal accident involving a contractor truck operator at Séguéla during the quarter. Ganoza said the company has renewed its focus on heavy mobile-equipment controls, contractor management and field verification of critical controls.
About Fortuna Mining (NYSE:FSM)
Fortuna Mining Corp. engages in the precious and base metal mining in Argentina, Burkina Faso, Mexico, Peru, and Côte d’Ivoire. It operates through Mansfield, Sanu, Sango, Cuzcatlan, Bateas, and Corporate segments. The company primarily explores for silver, lead, zinc, and gold. Its flagship project is the Séguéla gold mine, which consists of approximately 62,000 hectares and is located in the Worodougou Region of the Woroba District, Côte d’Ivoire. The company was formerly known as Fortuna Silver Mines Inc and changed its name to Fortuna Mining Corp.
