FULLTEXT DEL 2 AV 3
Kvartalsrapport Q4 2025
Eagle (USA)
The Eagle mine consists of the Eagle underground mine, located approximately 53 km northwest of Marquette, Michigan,
U.S.A. and the Humboldt mill, located 61 km west of Marquette. The plant has a processing capacity of 0.7 mtpa, producing
nickel and copper in concentrates. The primary metal is nickel with copper, and minor amounts of cobalt, gold, and
platinum-group metals as by-product metals. In December 2025, the Company announced the sale of Eagle to Talon; the
transaction closed on January 9, 2026.
Operating Statistics (Discontinued Operation)
2025 2024
(100% Basis) Total Q4 Q3 Q2 Q1 Total Q4 Q3 Q2 Q1
Ore mined (kt) 695 182 184 167 162 480 117 91 107 165
Ore milled (kt) 686 173 183 169 161 487 121 90 97 179
Grade
Nickel (%) 1.7 1.5 1.8 1.9 1.7 1.9 1.7 1.4 2.1 2.1
Copper (%) 1.4 1.2 1.3 1.6 1.4 1.4 1.1 1.2 1.7 1.5
Recovery
Nickel (%) 83.7 82.9 84.2 84.6 82.6 82.0 78.7 72.3 85.0 85.2
Copper (%) 95.4 95.3 95.7 95.5 95.0 95.1 94.1 94.3 95.9 95.3
Production (contained metal)
Nickel (t) 9,907 2,174 2,724 2,713 2,296 7,486 1,617 893 1,721 3,255
Copper (t) 8,906 1,957 2,354 2,510 2,085 6,366 1,262 1,027 1,563 2,514
Sales volume (payable metal)
Nickel (t) 7,651 1,756 1,921 2,226 1,748 5,662 1,088 393 2,018 2,163
Copper (t) 7,583 1,637 1,908 2,489 1,549 5,457 877 733 1,789 2,058
Revenue ($ millions) 208.6 52.2 53.1 59.1 44.3 152.5 25.6 12.2 57.4 57.2
Production costs ($ millions) 150.7 38.0 35.2 40.4 37.2 111.9 21.1 12.5 37.7 40.5
Gross profit (loss) ($ millions) 35.6 8.9 11.3 12.8 2.6 7.0 (3.8) (6.5) 9.7 7.6
Cash cost ($ per pound nickel)1 2.55 2.31 2.11 2.02 3.94 4.20 5.22 7.24 3.23 4.04
Sustaining capital ($ millions)1 21.3 3.9 6.6 6.4 4.5 21.2 5.2 7.9 4.0 4.1
AISC ($ per pound nickel)1 5.18 5.13 4.96 4.58 6.20 7.60 9.53 20.02 5.71 6.12
1AISC per pound sold and Cash cost per pound sold are non-GAAP measures and Sustaining Capital is a supplementary financial measure, see the "Non-
GAAP and Other Performance Measures" section of this MD&A for discussion.
Production
Mining and processing activities continued at normal levels during the quarter following the completion of ramp
rehabilitation in Eagle East in the first quarter of the year. The lower production levels in the comparative quarter and year,
which resulted from the fall of ground in the lower ramp in Eagle East in Q2 2024, remained the primary driver of higher
nickel and copper production in the current quarter and year. Annual nickel production in 2025 was within the most recent
production guidance ranges, while annual copper production was below the low end of the most recent guidance range but
within the original guidance range.
Production Costs and Cash Cost
Production costs in the quarter and year were higher than in the prior year comparable periods due to increased nickel and
copper sales volumes. Production costs in the prior quarter and year excluded approximately $11.4 million and $36.1
million, respectively, of overhead costs that were recorded in Other Income and Expense as a result of the partial
suspension of underground mining operations.
Cash cost per pound in the quarter and year was lower than in the prior year comparable periods, primarily reflecting
higher throughput and improved recoveries, resulting in higher nickel production, as well as increased by-product credits
driven by higher copper sales volume and elevated realized copper price. Annual cash cost per pound for the year exceeded
the high end of the most recent production guidance range. AISC per pound in the quarter and year were lower than in the
prior year comparable periods in line with reduced cash cost per pound.
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===== SIDA 52 =====
Gross Profit and Net Earnings
Gross profit in the quarter was higher than in the prior year comparable period primarily due to increased realized copper
prices and reduced depreciation expense. Gross profit in the year was higher than in the prior year primarily due to
increased nickel and copper sales volumes, lower depreciation expense and increased realized copper price, partially offset
by lower realized nickel price.
Net earnings were impacted by an impairment reversal of $88.4 million ($69.8 million net of tax) after assessing the fair
value of Eagle prior to reclassification as held for sale. The fair value was based on the consideration established in the
definitive agreement with Talon. An impairment charge of $104.9 million ($82.8 million net of tax) was previously recorded
for the Eagle mine at December 31, 2024 due to a decline in nickel prices and prolonged rehabilitation of the Eagle East
ramp.
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===== SIDA 53 =====
Neves-Corvo (Portugal)
Neves-Corvo is located 200 km southeast of Lisbon, Portugal and consists of an underground mine and on-site processing
facilities. In April 2025, the Company sold Neves-Corvo to Boliden.
Operating Statistics (Discontinued Operation)
2025 2024
(100% Basis) Total2 Q22 Q1 Total Q4 Q3 Q2 Q1
Ore mined, copper (kt) 634 88 546 2,412 643 579 602 588
Ore mined, zinc (kt) 643 100 543 2,127 539 571 499 518
Ore milled, copper (kt) 582 78 504 2,426 643 583 601 599
Ore milled, zinc (kt) 622 85 537 2,127 568 540 507 512
Grade
Copper (%) 1.6 1.9 1.6 1.5 1.4 1.5 1.6 1.5
Zinc (%) 6.7 6.9 6.7 6.5 6.3 7.0 6.3 6.5
Lead (%) 1.3 1.4 1.3 1.2 1.1 1.4 1.3 1.2
Recovery
Copper (%) 78.5 81.1 78.0 76.9 78.3 74.9 77.2 77.3
Zinc (%) 76.3 79.0 75.8 77.3 76.0 76.9 78.2 78.4
Lead (%) 29.5 31.6 29.2 24.6 25.4 24.8 21.7 26.5
Production (contained metal)
Copper (t) 7,348 1,225 6,123 28,228 7,139 6,698 7,347 7,044
Zinc (t) 32,356 4,665 27,691 109,571 27,879 29,509 25,696 26,487
Lead (t) 2,361 369 1,992 6,395 1,553 1,851 1,387 1,604
Silver (koz) 534 75 459 1,876 494 425 433 524
Sales volume (payable metal)
Copper (t) 6,745 1,394 5,351 26,721 5,230 7,707 7,898 5,886
Zinc (t) 27,673 3,823 23,850 88,731 21,357 25,730 20,440 21,204
Lead (t) 1,920 440 1,480 5,700 1,323 1,811 1,242 1,324
Revenue ($ millions) 128.3 19.8 108.4 438.0 97.5 131.2 128.7 80.6
Production costs ($ millions) 90.2 14.3 75.9 323.2 73.2 95.2 83.1 71.7
Gross profit (loss) ($ millions) 38.1 5.5 32.5 (3.5) (2.6) 1.3 15.9 (18.1)
Cash cost ($ per pound copper)1 1.84 2.42 1.69 2.19 1.84 2.13 1.70 3.24
Sustaining capital ($ millions)1 27.7 — 27.7 89.3 12.7 26.3 27.9 22.4
AISC ($ per pound copper)1 3.89 2.51 4.25 3.92 3.37 3.84 3.46 5.13
1AISC per pound sold and Cash cost per pound sold are non-GAAP measures and Sustaining Capital is a supplementary financial measure, see the "Non-
GAAP and Other Performance Measures" section of this MD&A for discussion.
2 Neves-Corvo 2025 results are to April 16, 2025.
Production
Neves-Corvo was sold on April 16, 2025. In 2025 through to the date of sale, copper production was lower than in the prior
year comparable period due to lower throughput, and zinc production increased due to higher throughput and grades.
Production Costs and Cash Cost
Production costs in 2025 through to the date of sale were higher than in the prior year comparable period primarily due to
higher zinc sales volume and an increase in electricity and maintenance costs, partially offset by favourable foreign
exchange. Electricity costs increased as a result of higher market energy prices. Cash cost per pound in Q1 2025 was lower
than in the prior year comparable period primarily due to higher by-product credits driven by an increase in zinc sales
volume and higher realized zinc prices as well as favourable foreign exchange, partially offset by lower copper sales volume.
AISC per pound in Q1 2025 was lower than AISC from the prior year comparable period due to lower cash cost per pound
offset partially by higher sustaining capital expenditures.
Gross Profit (Loss)
Gross profit in 2025 through to date of sale was higher than the prior year comparable period primarily due to no
depreciation being taken on assets classified as held for sale, as well as higher realized copper and zinc prices and lower
treatment and refining charges, partially offset by lower copper sales volume and higher electricity costs. Net earnings were
impacted by a non-cash impairment charge of $ 66 million in Q1 2025 to recognize mining rights and mineral properties at
their estimated fair value, based on the cash proceeds received.
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===== SIDA 54 =====
Zinkgruvan (Sweden)
The Zinkgruvan mine consists of an underground mine and on-site processing facilities, located approximately 200 km
southwest of Stockholm, Sweden. In April 2025, the Company sold Zinkgruvan to Boliden.
Operating Statistics (Discontinued Operation)
2025 2024
(100% Basis) Total2 Q22 Q1 Total Q4 Q3 Q2 Q1
Ore mined, zinc (kt) 393 64 329 1,246 332 300 308 306
Ore mined, copper (kt) 59 — 59 184 8 84 45 47
Ore milled, zinc (kt) 403 66 337 1,239 311 302 313 313
Ore milled, copper (kt) 51 — 51 207 14 76 42 75
Grade
Zinc (%) 7.0 7.5 6.9 7.3 8.4 6.3 7.7 6.7
Lead (%) 2.8 3.2 2.8 3.1 3.7 2.4 3.7 2.7
Copper (%) 2.1 — 2.1 2.2 2.0 2.1 2.0 2.4
Recovery
Zinc (%) 91.6 92.6 91.4 90.9 91.8 89.8 90.6 91.1
Lead (%) 81.1 78.3 81.7 80.0 83.0 78.5 78.2 79.4
Copper (%) 90.2 — 90.2 88.1 86.7 87.3 88.0 89.0
Production (contained metal)
Zinc (t) 25,877 4,620 21,257 82,133 24,067 17,101 21,764 19,201
Lead (t) 9,291 1,705 7,586 30,888 9,481 5,693 8,966 6,748
Copper (t) 971 — 971 3,964 258 1,385 747 1,574
Silver (koz) 737 152 585 2,513 637 537 699 640
Sales volume (payable metal)
Zinc (t) 20,698 1,548 19,150 68,086 18,627 15,124 18,510 15,825
Lead (t)3 6,948 (120) 7,068 28,036 7,786 6,346 9,069 4,835
Copper (t) 982 — 982 3,809 457 1,775 821 756
Revenue ($ millions) 72.4 0.8 71.6 256.8 67.5 68.6 76.6 44.1
Production costs ($ millions) 36.9 2.7 34.2 122.0 29.1 30.1 32.7 30.1
Gross profit (loss) ($ millions) 35.5 (1.9) 37.4 97.7 32.5 24.2 35.0 6.0
Cash cost ($ per pound)1 0.46 1.18 0.40 0.41 0.43 0.16 0.39 0.65
Sustaining capital ($ millions)1 30.4 9.1 21.3 65.7 22.5 15.5 13.3 14.3
AISC ($ per pound)1 1.13 3.85 0.91 0.87 0.99 0.66 0.74 1.10
1AISC per pound sold and Cash cost per pound sold are non-GAAP measures and Sustaining Capital is a supplementary financial measure, see the "Non-
GAAP and Other Performance Measures" section of this MD&A for discussion.
2 Zinkgruvan 2025 results are to April 16, 2025.
3 Lead sales volume in Q2 2025 was impacted by volume adjustments.
Production
Zinkgruvan was sold on April 16, 2025. In 2025 through to the date of sale, zinc and lead production were higher than in the
prior year comparable period due to higher throughput, grades and recoveries. Zinc production was positively impacted by
favourable mine sequencing and high grade stopes. Copper production was lower than in the prior year comparable period
primarily due to lower throughput and remained in line with the mine plan as zinc production was prioritized.
Production Costs and Cash Cost
Production costs in 2025 through to the date of sale were higher than in the prior year comparable period primarily due to
higher zinc and lead sales volumes. Cash cost per pound in Q1 2025 was lower than in the prior year comparable period
primarily due to increased zinc sales volume as well as higher by-product credits as a result of higher copper sales volume
and higher copper realized prices. AISC per pound in Q1 2025 was lower than in the prior year comparable period due to
due to lower cash cost per pound slightly offset by higher sustaining capital expenditures.
Gross Profit
Gross profit in 2025 through to the date of sale was higher than in the prior year comparable period primarily due to no
depreciation being taken on assets classified as held for sale, as well as higher realized zinc and copper prices, lower
treatment and refining charges and higher zinc, copper and lead sales volume.
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===== SIDA 55 =====
Vicuña Project (Argentina and Chile)
Integrated Technical Study Results
The results of an integrated technical study were published on February 16, 2026 and highlighted the Vicuña Project as a
development project with the potential to rank among the top five copper, gold, and silver mines globally. Highlights from
the PEA are outlined below and more information is set out in the news release dated February 16, 2026.
The development of the Vicuña district is envisioned in a staged approach. Stage 1 encompasses a sulphide mill and the
Josemaria deposit, establishing an initial open pit mine and concentrator designed for future expansion to accelerate first
production and early cash flow. Stage 2 builds on this foundation by developing the Filo del Sol leachable oxides and a
corresponding SX/EW plant for copper, gold and silver recovery. Stage 3 represents the long-term maturation of the district
through expansion of the concentrator and development of the Filo del Sol sulphide deposit, enabling peak, sustained
production, positioning the Vicuña Project as a long-life, globally significant copper operation. Stage 3 also integrates key
district infrastructure, including a desalination plant and associated pipeline, and return concentrate slurry pipeline, to
support expansion of the district.
• Potential to be a top five copper, gold, and silver mine: Average annual production of 400,000 tonnes copper,
700,000 oz gold and 22 million oz ("Moz") silver over the first 25 full years of operation.
• Peak production of +500 ktpa copper: Average production over a ten-year period of over 500,000 tonnes copper,
800,000 oz gold and 20 Moz silver or 800,000 tonnes copper equivalent (“CuEq”)1.
• Multi-generational asset: Initial +70-year life of mine ("LOM"), producing approximately 22.3 million tonnes (“Mt”)
of copper, 37.2 Moz of gold and 763 Moz of silver.
• Significant free cash flow: Average annual free cash flow of $2.2 billion per year (after expansionary capital) during
the first 25 years.
• Leveraged to copper and gold: LOM revenue contribution of 60% copper, 32% gold and 8% silver.
• Capital intensity below $30,000/tonne CuEq: Stage 1 capital of $7.1 billion with an after-tax payback period of 8.42
years and an after-tax internal rate of return ("IRR") of 14.8%.
• Resource growth: The Updated Vicuña Mineral Resource grew significantly compared to the previous estimate3.
◦ Contained copper4 of 14 Mt Measured and Indicated (“M&I”) and 32 Mt Inferred. An increase of 12%
contained M&I copper and 28% Inferred copper.
◦ Contained gold 4 of 36 Moz M&I and 61 Moz Inferred. An increase of 12% contained M&I gold and 26%
Inferred gold.
◦ Contained silver4 of 729 Moz M&I and 1,051 Moz Inferred. An increase of 11% M&I silver and 30%
Inferred silver.
• Base-case scenario: Net present value ("NPV8%") of $9.5 billion after-tax at $4.60/lb copper, $3,300/oz gold and
$40/oz silver.
◦ Stage 1 is clearly defined providing a blueprint for initial development, ongoing studies on Stages 2 and 3
are expected to deliver further optimization.
• At spot copper, gold and silver prices ($6.00/lb copper, $5,000/oz gold & $80/oz silver), the NPV8% increases to
$28.8 billion and the IRR to 25.5% with a payback of 5.4 years.
The results of the Study, including the Updated Vicuña Mineral Resource, will be detailed in an updated technical report
that will be filed under the Company’s profile on SEDAR+ at www.sedarplus.ca. These results supersede the “NI 43-101
Technical Report on the Vicuña Project, Argentina and Chile” with an effective date of April 15, 2025, including the Mineral
Resource estimate set out therein.
31
1 Copper equivalent (CuEq) based on production after recoveries and metal prices of $4.60/lb Cu, $3,300/oz Au and $40/oz Ag.
2 Initial capital from the start of 2027 and payback period from the start of 2030.
3 See news release dated May 4, 2025 and previous technical report entitled “NI 43-101 Technical Report on the Vicuña Project, Argentina and Chile”, with
an effective date of April 15, 2025 for information with respect to the previous Mineral Resource estimate. The Project is a 50:50 joint venture between
Lundin Mining and BHP Canada. Lundin Mining’s attributable interest in the Mineral Resource estimate is 50%.
4 M&I contained metal is based on estimated tonnes of 4,181Mt and estimated grades of 0.34% Cu, 0.27g/t Au and 5.4g/t Ag. Inferred contained metal is
based on estimated tonnes of 10,641Mt at estimated grades of 0.30% Cu, 0.18g/t Au and 3.1g/t Ag.
===== SIDA 56 =====
RIGI Application
During the quarter, Vicuña submitted an application to the Incentive Regime for Large Investments (RIGI) in Argentina for
the inclusion of the Vicuña Project under the Long-Term Strategic Export Projects designation (PEELP). Argentina’s RIGI
regime is designed to attract and accelerate large-scale investment through long-term fiscal stability and transparent
regulatory conditions.
RIGI offers regulatory stability, including lower corporate and dividend withholding tax rates, removal of export duties,
value added tax offsets and repatriation of revenues. The Vicuña Project is the first mining project to apply for the RIGI
PEELP, which is designed to support large scale, long-term investments into Argentina and provides longer benefit periods
(40 years vs 30 years) and accelerated timelines to repatriate revenues and export duty exemptions, as compared to the
regular RIGI regime.
Project Development
In 2025, parallel studies were advanced supporting a multi-phased development concept pertaining to the Josemaria and
Filo del Sol deposits resulting in an integrated technical study, the results of which were published on February 16, 2026.
These results, including the Updated Vicuña Mineral Resource estimate, will be detailed in an updated technical report that
will be filed under the Company’s profile on SEDAR+ at www.sedarplus.ca.
The Josemaria Environmental Impact Assessment advanced through review by the San Juan authorities with a site visit
performed during the quarter.
Drilling activities at Filo del Sol advanced with 16,619 metres completed during the quarter, bringing the year-to-date total
to 65,611 metres.
During the year, the Company spent $167.2 million in capital expenditures compared to $243.6 million in 2024. Capital
expenditures included the project development activities noted above and were impacted by the formation of Vicuña on
January 15, 2025. From this date, the Company's expansionary capital expenditures include 50% of Vicuña's capital
expenditures compared to 100% funded for Josemaria prior to the formation of Vicuña.
The Company intends to continue with to work with its partner, BHP, and Vicuña on a work plan to advance the Vicuña
Project to production. Key activities and milestones include:
• Ongoing detailed engineering and design activities for Stage 1.
• Trade off studies and optimization of Stages 2 & 3.
• Initiate construction of the North Access Road.
• Further advancement of project readiness in preparation for early earthworks.
• Advancement of financing structure within Vicuña to fund construction.
• Approval of the Incentive Regime for Large Investments under the Long-Term Strategic Export Projects designation
(RIGI PEELP) application in Argentina.
• Receipt of the Project permit amendment.
The next phase for the Vicuña Project is detailed design and engineering. The technical team will focus on advancing
engineering in order to prepare procurement and other activities to support an efficient project start-up and mitigate risks
of increasing lead times and variable international logistics.
About Vicuña
On January 15, 2025, the Company completed the Filo Acquisition and the Joint Arrangement, resulting in the Company
indirectly holding a 50% interest in Vicuña, an independently managed joint operation which owns the Josemaria deposit in
Argentina and the Filo del Sol deposit in Argentina and Chile. BHP indirectly owns the remaining 50% interest in Vicuña.
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===== SIDA 57 =====
Expansionary Projects
The Company has a number of brownfield low-capital intensity expansionary projects that are expected to contribute to
medium-term growth in its existing operating asset portfolio.
Candelaria Underground Expansion
The Candelaria underground expansion project is expected to increase underground throughput capacity to approximately
22,000 tonnes per day from prior levels of approximately 12,000 to 14,000 tonnes per day, targeting a medium-term
increase in annual copper production of approximately 14,000 tonnes of copper which adds roughly 10% to current
production levels. The opportunity includes phased insourcing of the Company's underground mining contract and an
increase in the number of active mining stopes. Candelaria’s 2026 copper and gold production guidance incorporates lower
underground mining rates in the first half of the year as the Company insources the underground mining contract. Internal
recruitment commenced in mid-2025 with blasting, loading and hauling activities insourced at the end of the year.
Insourcing of additional activities are expected to continue through 2026.
Projects are also ongoing to support the mine life extension under the Environmental Impact Assessment ("2040 EIA").
Caserones Cathode Plant Utilization
The Caserones cathode plant capacity is approximately 35,000 tonnes of copper cathode production per year, representing
an opportunity to increase production from prior levels through higher utilization rates.
Additional oxide material placed on the dump leach, together with improved leaching practices, increased copper cathode
production to 25,817 tonnes in 2025. As a result of these optimization efforts, annual copper cathode production is forecast
to increase to approximately 26,000 to 28,000 tonnes in 2026 through 2028, an improvement of 6,000–8,000 tonnes from
prior levels.
Chapada - Saúva Deposit
The Saúva deposit is approximately 15 kilometres from the Chapada mine and represents a near mine opportunity to add
approximately 10,000 to 15,000 tonnes of copper production per year and 35,000 to 45,000 ounces of gold production per
year. The project would include the installation of additional grinding capacity and higher grade ore from Saúva to offset
lower grade material currently being mined at Chapada.
An internal prefeasibility study was completed on Saúva phase 1 during the quarter. A sanctioning decision on the
installation of additional grinding capacity is expected in the second half of 2026, while detailed design and engineering
work will continue along with Saúva permitting. An updated Chapada technical report, including the Saúva project, is
expected to be released in the second half of 2026.
Exploration Update
In 2025, exploration activity focused on in-mine and near-mine targets at the Company's operations.
At Caserones, seven rigs drilled 10,329 metres during the quarter targeting high-grade copper breccias in the Caserones pit
and copper sulphides at Angelica. Exploration drilling also commenced at the Centauro target. In total, 18,908 metres were
drilled at Caserones during the year.
No exploration drilling was undertaken at Candelaria during the quarter. In total, 7,642 metres were drilled at Candelaria
during the year focusing on Candelaria Norte, Candelaria South (Mariana) and La Portuguesa.
The annual drilling program at Chapada was completed during the quarter with 12,507 metres drilled during the year,
primarily in the Saúva resource area.
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===== SIDA 58 =====
Liquidity and Capital Resources
Consolidated Cash Flow
Year ended December 31,
($ millions) 2025 2024 Change
Cash provided by operating activities from continuing operations 1,207.9 1,311.4 (103.5)
Cash provided by (used in) investing activities from continuing operations 707.2 (834.9) 1,542.1
Cash used in financing activities from continuing operations (2,080.3) (342.9) (1,737.4)
Effect of foreign exchange on cash balances 1.5 (4.2) 5.7
(Decrease) increase in cash and cash equivalents (114.1) 163.5 (277.6)
Opening cash and cash equivalents 432.3 268.8 163.5
Closing cash and cash equivalents 296.2 357.5 (61.3)
Adjusted operating cash flow1 - continuing operations 1,621.9 1,089.9 532.0
Free cash flow from operations1 - continuing operations 773.6 825.6 (52.0)
Free cash flow1 - continuing operations 538.9 539.9 (1.0)
1This is a non-GAAP measure - see section "Non-GAAP and Other Performance Measures" of this MD&A for discussion.
Cash provided by operating activities related to continuing operations during the year was $103.5 million lower than in the
prior year. The decrease was primarily due to working capital movements including increased trade receivables at
Candelaria and Caserones, partially offset by higher gross profit. Adjusted operating cash flow1 - continuing operations
during the year was higher than in the prior year after adjusting for the significant build of working capital.
The sale of the Neves-Corvo and Zinkgruvan operations in April 2025 contributed $1.3 billion in net proceeds to cash
provided by investing activities related to continuing operations. In addition, capital expenditures at continuing operations
were $101.5 million lower than in the prior year. Lower sustaining capital expenditures were primarily due to reduced
deferred stripping at Candelaria and lower expansionary capital expenditures were primarily due to the formation of Vicuña
on January 15, 2025. From this date, the Company's expansionary capital expenditures include 50% of Vicuña's capital
expenditures. A summary of capital expenditures on a cash basis is outlined below.
34
1 This is a non-GAAP measure - see section "Non-GAAP and Other Performance Measures" of this MD&A for discussion.
===== SIDA 59 =====
Summary of Capital Expendituresa
Year ended December 31,
($ millions) 2025 2024
Candelaria 21.6 —
Chapada 2.4 —
Vicuña 167.2 243.6
Expansionary capital investment from continuing operations 191.2 243.6
Candelaria 224.4 275.7
Caserones 156.3 144.0
Chapada 96.8 107.8
Other 0.3 0.4
Sustaining capital investment from continuing operations 477.8 527.9
Total capital expenditures from continuing operations 669.0 771.5
Reconciliation to Investment in mineral properties, plant and equipment:
Capitalized interest 15.6 14.6
Total Investment in mineral properties, plant and equipment from continuing operations 684.6 786.1
Total Investment in mineral properties, plant and equipment from discontinued operationsb 79.2 176.2
Total Investment in mineral properties, plant and equipment (all operations) 763.8 962.3
a Capital expenditures are reported on a cash basis, as presented in the consolidated statement of cash flows. Sustaining capital expenditures is a
supplementary financial measure and expansionary capital expenditures is a non-GAAP measure – see the "Non-GAAP and Other Performance
Measures" section of this MD&A for discussion.
b Discontinued operations include Eagle, and Neves-Corvo and Zinkgruvan financial results to April 16, 2025.
Cash used in financing activities related to continuing operations increased from the prior year primarily due to the
repayment in full of the $1,150.0 million outstanding balance of the Company's term loan and repayment of $170.0 million
of amounts drawn on the RCF with the net cash proceeds from the sale of Neves-Corvo and Zinkgruvan. These increases
were partially offset by lower interest and dividends paid. The Company repurchased shares under its NCIB totalling $153.7
million in the year compared to $24.4 million during 2024.
Free cash flow from operations 1 - continuing operations decreased from the prior year primarily due to a working capital
build, partially offset by reduced sustaining capital expenditures. Free cash flow1 - continuing operations was consistent
with the prior year due to lower expansionary capital expenditures at Vicuña offset by the same factors impacting free cash
flow from operations - continuing operations.
35
1 This is a non-GAAP measure - see section "Non-GAAP and Other Performance Measures" of this MD&A for discussion.
===== SIDA 60 =====
Liquidity and Financial Position
($ millions) December 31, 2025 December 31, 2024 Change
Cash and cash equivalents 296.2 357.5 (61.3)
Total assets1 10,820.6 10,406.8 413.8
Debt2 237.1 1,757.0 (1,519.9)
Lease liabilities2 212.5 249.2 (36.7)
Net cash (debt)1, 3 77.4 (1,332.4) 1,409.8
1 Total assets and Net cash (debt) include assets and liabilities classified as held for sale.
2 Debt and lease liabilities include both current and non-current portions.
3 This is a non-GAAP measure and includes balances classified as held for sale - see section "Non-GAAP and Other Performance Measures" of this MD&A
for discussion.
The Company continues to expect to be able to fund all its contractual commitments with its operating cash flow, cash on
hand and available capital resources.
The Company was in a net cash position as at December 31, 2025 of $77.4 million compared to a net debt position of
$1,332.4 million at the prior year end primarily due to net cash proceeds from the sale of the Neves-Corvo and Zinkgruvan
operations, which were used to repay in full the $1,150.0 million outstanding balance of the Company's term loan and to
repay $170.0 million of amounts drawn on the RCF.
During the year, 15,088,180 shares were purchased under the Company's NCIB program for $150.0 million (2024 -
2,815,200 for $24.4 million).
Commodity prices, primarily copper and gold, are key performance drivers and fluctuations in the prices of these
commodities can have a dramatic effect on the results of operations. Prices can fluctuate widely and are affected by
numerous factors beyond the Company’s control. The prices of metals are influenced by supply and demand, exchange
rates, interest rates and interest rate expectations, inflation or deflation and expectations with respect to inflation or
deflation, speculative activities, changes in global economies, and geopolitical, social and other factors. The supply of
metals consists of a combination of new mine production, recycling and existing stocks held by governments, producers and
consumers. The Company economically hedges certain of its operating currencies as well as metal prices and certain input
commodities (refer to "Financial Instruments" section below).
Contractual Obligations, Commitments and Contingencies
The Company has contractual obligations and capital commitments as described in Note 27 “Commitments and
contingencies” in the Company’s consolidated financial statements for the year ended December 31, 2025 . From time to
time, the Company may also be involved in legal proceedings that arise in the ordinary course of its business.
Significant changes to commitments and contingencies, from those reported at December 31, 2024, are described below:
In respect of the 2017 taxation year, the Canada Revenue Agency ("CRA") issued a reassessment denying the Company’s
2007 election to increase the tax cost of its investment in a subsidiary. The reassessment proposes an increase in taxable
income of approximately $456 million, which would result in additional income taxes payable of approximately $114.1
million and interest of approximately $46.2 million. The Company filed a Notice of Objection on January 28, 2026 and will
vigorously and expeditiously defend its tax filing position through CRA's Appeals Division and, if required, court proceedings.
No provision has been recognized as the Company believes its filing position is in compliance with Canadian tax law.
36
===== SIDA 61 =====
The Company has the following contractual obligations and capital commitments as at December 31, 2025:
Payments due by period1
($ millions) <1 year 1-5 years Thereafter Total
Continuing operations
Reclamation and closure provisions 12.1 70.6 632.4 715.1
Debt 180.8 60.0 — 240.8
Lease liabilities 61.6 129.8 113.4 304.7
Capital commitments 193.7 130.0 — 323.7
Defined pension obligations — — 3.3 3.3
Deferred consideration 10.0 120.0 — 130.0
458.2 510.4 749.1 1,717.7
Discontinued operations
Reclamation and closure provisions 3.6 30.1 45.7 79.4
Lease liabilities 2.3 8.5 — 10.8
Capital commitments 3.3 — — 3.3
9.2 38.6 45.7 93.5
Total 467.4 549.0 794.8 1,811.2
1Reported on an undiscounted basis, before inflation.
Capital Resources
On February 16, 2026, the Company announced the results of an integrated technical study on the Vicuña Project, including
estimated capital and operating costs. For Stage 1 of the Vicuña Project, the Study contemplates a 40-month capital
development and construction timeline that includes a 6-month commissioning period. Total initial capital cost for Stage 1
is estimated at $7.1 billion and $18.1 billion for stages 1-3. LOM sustaining capital is estimated at $30.3 billion over 70 years
for all stages, including closure costs. The Study outlines a comprehensive development plan for Stage 1, encompassing
construction of the concentrator and development of the Josemaria mine. The capital estimates and operating cost
estimates are established from first principles. For Stage 1, estimates were completed to a class 3, contingency has been
applied to the estimate on an area and discipline basis, variances ranged from -15% to +20% depending on the area and
level of quotation. The Stages 2 and 3 estimate are completed to a class 5 and variances range from -35% to +50%.
On February 12, 2026, the Company announced the receipt of commitments from 17 lenders to upsize and amend its RCF,
increasing the total committed amount from $1.75 billion to $4.5 billion with the Company initially having access to $2.25
billion. Upon satisfaction of certain conditions, the RCF will expand to $3.5 billion, and upon sanctioning Stage 1 of the
Vicuña Project, will increase to the full $4.5 billion. In addition, the maturity date has been extended to 2031. Once
amended, the RCF will bear interest on a sliding scale of adjusted term SOFR plus a margin of 1.45% to 2.50%.
As at December 31, 2025, the Company has an RCF of $1,750.0 million with $60.0 million outstanding (December 31, 2024 -
$270.0 million). The RCF matures in April 2029 and bears interest on drawn funds at rates of Term Secured Overnight
Financing Rate (“Term SOFR”) plus Credit Spread Adjustment (“CSA”) of 0.10% plus an applicable margin of 1.40% to 2.55%,
depending on the Company’s net leverage ratio and progress against sustainability performance targets. In March 2025, the
security previously held over certain assets in the USA was removed from the RCF. The facility is subject to customary
covenants.
In April 2025, the Company repaid in full the $1,150.0 million outstanding balance of the term loan and $170.0 million of
amounts drawn on the RCF using the cash proceeds from the sale of the Neves-Corvo and Zinkgruvan operations. As a result
of the repayment, the term loan has been extinguished and cannot be redrawn. In April 2025, the Company also repaid the
$102.7 million (€95.0 million) outstanding balance of commercial paper programs at Neves-Corvo immediately prior to its
sale.
As at December 31, 2025, the Company was in compliance with its debt covenants.
37
===== SIDA 62 =====
As at December 31, 2025, certain subsidiaries of the Company had outstanding unsecured term loans totalling $180.8
million (December 31, 2024 - $245.9 million) which accrue interest at rates ranging from 4.30% to 5.19% per annum with
interest payable upon their maturities, ranging from January to March 2026.
The development of the Vicuña Project requires significant capital commitments from the Company and additional funding,
beyond debt from the Company's upsized RCF, may be required to advance the projects to completion.
38
===== SIDA 63 =====
Financial Instruments
Revenue, cost of goods sold and capital expenditures are affected by certain external factors including fluctuations in metal
prices, energy prices, and changes in exchange rates between the CLP, the BRL, the ARS and the $.
During the year, the Company did not enter into any new derivative contracts. At December 31, 2025 , existing derivative
contracts consist of foreign currency option contracts as well as commodity option contracts. The option contracts consist
of put and call contracts in a collar structure with all contracts maturing in 2026.
The derivative contracts have not been designated as hedges for purposes of hedge accounting and are measured at fair
value as assessed by pricing models based on active market prices. Changes in fair value are recognized in other income and
expense in the consolidated statement of earnings.
For a detailed discussion of the Company’s financial instruments, refer to Note 26 "Financial Instruments" in the Company’s
consolidated financial statements for the year ended December 31, 2025.
The Company’s trade receivables also contain provisional pricing sales arrangements that are valued using quoted forward
market prices. The following table illustrates the sensitivity of the Company’s risk on final settlement of its provisionally
priced revenues as at December 31, 2025.
Metal Payable Metal
Provisional price on
December 31, 2025 Change
Effect on Revenue
($millions)
Copper 80,435 t $5.64/lb +/- 10 % +/- $100.0
Gold 31,760 oz $4,343/oz +/- 10 % +/- $13.8
Molybdenum 619 t $23.30/lb +/- 10 % +/- $3.2
For further information on the Company's management of financial risks, including those associated with financial and
other instruments, refer to Note 30 "Management of Financial Risk" of the Company’s consolidated financial statements for
the year ended December 31, 2025.
Foreign Currency Denominated Production Costs
For the year ended December 31, 2025, Candelaria and Caserones production costs are approximately 55% CLP
denominated and Chapada production costs are approximately 75% BRL denominated.
Period end exchange rates having a meaningful impact on foreign exchange recorded for continuing operations as at
December 31, 2025 were:
December 31, 2025 December 31, 2024 Change
Brazilian Real (USD:BRL) 5.50 6.19 (0.69)
Chilean Peso (USD:CLP) 911 992 (81)
Argentine Peso (USD:ARS) 1,455 1,033 422
The average exchange rates impacting continuing operations were:
Three months ended December 31, Year ended December 31,
2025 2024 Change 2025 2024 Change
Brazilian Real (USD:BRL) 5.39 5.84 (0.45) 5.59 5.39 0.20
Chilean Peso (USD:CLP) 935 963 (28) 951 944 7
Argentine Peso (USD:ARS) 1,436 1,002 434 1,244 916 327
39
===== SIDA 64 =====
Non-GAAP and Other Performance Measures
The Company uses certain performance measures in its analysis and disclosure. These performance measures have no
standardized meaning within generally accepted accounting principles under IFRS and, therefore, amounts presented may
not be comparable to similar data presented by other mining companies. This data is intended to provide additional
information and should not be considered in isolation or as a substitute for measures of performance prepared in
accordance with IFRS. The following are non-GAAP measures that the Company uses as key performance indicators.
Non-GAAP financial
measure or ratio Definition
Most directly
comparable IFRS
measure
Why management uses the
measure and why it may be
useful to investors
Cash cost Includes costs directly attributable to mining operations
(including mining, processing and administration),
treatment, refining and transportation charges, but
excludes royalty expenses, expenses associated with non-
cash fair value adjustments to inventory, depreciation and
amortization and capital expenditures for deferred
stripping. Revenue from sales of by-products, inclusive of
adjustments for the terms of streaming agreements but
excluding the recognition of any deferred revenue from the
allocation of upfront streaming proceeds, reduce cash cost.
Production costs
from continuing
operations and
Production costs
from discontinued
operations
Copper, zinc, nickel and
consolidated cash cost per
pound sold are useful measures
to assess the operating
performance of the Company's
mines and their ability to
generate cash. The inclusion of
by-product credits incorporates
the benefit of other metals
extracted in the production of
the primary metal.
Cash cost per pound
sold
This ratio is calculated by dividing cash cost by the sales
volume of the primary metal (copper, zinc, or nickel).
Consolidated cash
cost per pound sold
This ratio is calculated by dividing combined cash cost for
primary copper producing assets by combined sales
volume for copper producing assets. Primary copper
producing assets include Candelaria, Caserones, and
Chapada.
All-in sustaining cost
("AISC")
Includes cash cost (as defined above), royalties, sustaining
capital expenditure (including deferred stripping and
underground mine development), reclamation and other
closure cost accretion and amortization and lease
payments (cash basis). As this measure seeks to reflect the
full cost of production from current operations,
expansionary capital and certain exploration costs are
excluded as these are costs typically incurred to extend
mine life or materially increase the productive capacity of
existing assets, or for new operations. Corporate general
and administrative expenses have also been excluded as
any attribution of these costs to an operating site would
not necessarily be reflective of costs directly attributable to
the administration of the site. Certain other cash
expenditures, including tax payments, financing charges
(including capitalized interest) and costs related to
business combinations, asset acquisitions and asset
disposals are also excluded.
Production costs
from continuing
operations and
Production costs
from discontinued
operations
Copper, zinc and nickel AISC
and AISC per pound sold are
useful measures to understand
the full cost of producing and
selling metal at the Company's
mines, and each mine's ability
to generate cash while
sustaining production at current
levels.
AlSC per pound sold This ratio is calculated by dividing AISC by the sales volume
of the primary metal (copper, zinc, or nickel).
Sustaining capital
expenditures
This supplementary financial measure is defined as cash-
basis expenditures which maintain existing operations and
sustain production levels.
Investment in
mineral properties,
plant and
equipment
Sustaining capital expenditures
provide an understanding of
costs required to maintain
existing production levels.
Expansionary capital
expenditures provide
information on costs required
for future growth of existing or
new assets.
Expansionary capital
expenditures
This non-GAAP measure is defined as cash-basis
expenditures which increase current or future production
capacity, cash flow or earnings potential and are reported
excluding capitalized interest. Where an expenditure both
maintains and expands current operations, classification
would be based on the primary decision for which the
expenditure is being made.
40
===== SIDA 65 =====
Non-GAAP financial
measure or ratio Definition
Most directly
comparable IFRS
measure
Why management uses the
measure and why it is useful to
investors
Realized price per
pound and realized
price per ounce1
Defined as revenue from metal sales (copper, gold, and
molybdenum) adding back treatment and refining charges,
cash effects of gold, silver and copper streams, recognition
of deferred revenue from the allocation of upfront
streaming proceeds, divided by the volume of metal sold in
the period.
Revenue from
continuing
operations
These measures provide an
understanding of the price
realized in each reporting
period for metal sales.
Earnings before
interest, taxes,
depreciation and
amortization
("EBITDA") and
Adjusted EBITDA
EBITDA represents net earnings or loss for the period
before income tax expense or recovery, depreciation and
amortization, and finance costs, net. Adjusted EBITDA
removes the effects of items that do not reflect the
Company's underlying operating performance and are not
necessarily indicative of future operating results. These
may include: unrealized foreign exchange, unrealized gains
or losses from derivative contracts, revaluation gains or
losses on marketable securities, derivative liabilities,
contingent consideration and purchase options, expenses
for acquisition-related fair value adjustments to inventory,
non-cash impairment charges and reversals, non-cash
stockpile inventory or fixed asset write-downs or reversals,
goodwill impairment, costs relating to the sinkhole near
Ojos del Salado operations, costs relating to the partial
suspension of underground operations at Eagle, gains or
losses on disposals or partial disposals of subsidiaries,
income from investments in associates, insurance proceeds
and litigation and settlements.
Net earnings (loss)
from continuing
operations and
from discontinued
operations
EBITDA and Adjusted EBITDA
are used to evaluate the
Company's operational
performance and its ability to
generate cash from core
operations.
Adjusted earnings
(loss)
Defined as net earnings or loss attributable to shareholders
of the Company excluding the effects (net of tax) of
significant items that do not reflect the Company's
underlying operating performance. In addition to the items
listed for Adjusted EBITDA, these may also include:
deferred tax recovery or expense arising from foreign
exchange translation, deferred tax recovery or expense
arising from changes in tax rates, and deferred tax recovery
or expense relating to disposals or partial disposals of
subsidiaries. Adjustments exclude amounts attributable to
non-controlling interests.
Net earnings (loss)
attributable to
Lundin Mining
Corporation
shareholders and
Net earnings (loss)
from continuing
operations
attributable to
Lundin Mining
Corporation
shareholders
In addition to conventional
measures prepared in
accordance with IFRS, adjusted
earnings and adjusted earnings
per share measure the
underlying operating
performance of the Company.
Adjusted earnings
(loss) per share
This ratio is calculated by dividing Adjusted earnings (loss)
by the weighted average number of shares outstanding.
Free cash flow from
operations
Defined as cash flow provided by operating activities,
excluding general exploration and business development
costs and deducting sustaining capital expenditures (as
defined above).
Cash provided by
operating activities
related to
continuing
operations and
Cash provided by
operating activities
related to
discontinued
operations
Free cash flow from operations
is indicative of the Company's
ability to generate cash from its
operations after consideration
of required sustaining capital
expenditure necessary to
maintain existing production
levels. Free cash flow further
considers expansionary capital
expenditure.
Free cash flow Defined as cash flow provided by operating activities,
deducting sustaining capital expenditures and
expansionary capital expenditures (both as defined above).
1See the 'Revenue Overview' section of this MD&A for reconciliations to revenue, the most directly comparable IFRS measure.
41
===== SIDA 66 =====
Non-GAAP financial
measure or ratio Definition
Most directly
comparable IFRS
measure
Why management uses the
measure and why it is useful to
investors
Adjusted operating
cash flow
Defined as cash provided by operating activities, excluding
changes in non-cash working capital items.
Cash provided by
operating activities
related to
continuing
operations and
Cash provided by
operating activities
related to
discontinued
operations
These measures are indicative
of the Company's ability to
generate cash from its
operations and remove the
impact of working capital,
which can experience volatility
from period-to-period.
Adjusted operating
cash flow per share
This ratio is calculated by dividing Adjusted operating cash
flow by the weighted average number of shares
outstanding.
Net cash (debt) Net cash (debt) is defined as total debt excluding deferred
financing fees, less cash and cash equivalents.
During the fourth quarter of 2025, management updated
the calculation of net cash (debt) to exclude lease
liabilities. Management believes this revised definition
provides a more meaningful measure of the Company's
leverage and better reflects how management evaluates its
capital structure and liquidity. Prior-period amounts have
been conformed to the current definition to ensure
comparability across periods.
Debt, current
portion of debt,
cash and cash
equivalents.
Additionally, the
above items as
included in assets
held for sale, and
liabilities held for
sale.
These measures are indicative
of the Company's financial
position.
42
===== SIDA 67 =====
Cash Cost per Pound and AISC per Pound
Cash Cost per Pound and AISC per Pound can be reconciled to Production costs on the Company's Consolidated Statements
of Earnings as follows:
Three months ended December 31, 2025
Continuing operations Candelaria Caserones Chapada Consolidated
Total -
continuing
operations1($ millions, unless otherwise noted) (Cu) (Cu) (Cu) (Cu)
Sales volumes (contained metal):
Tonnes 32,882 45,134 9,413 87,429
Pounds (000s) 72,492 99,503 20,752 192,747
Production costs 226.6 247.3 71.9 545.8 546.8
Less: Royalties and other (9.1) (20.4) (4.9) (34.4) (35.5)
217.5 226.9 67.0 511.4 $ 511.4
Deduct: By-product credits2 (56.8) (41.8) (58.0) (156.6) (156.6)
Add: Treatment and refining charges 5.6 1.9 0.4 7.9 7.9
Cash cost 166.3 187.0 9.4 362.7 362.7
Cash cost per pound ($/lb) 2.29 1.88 0.45 1.88
Add: Sustaining capital expenditure 79.5 56.8 21.1
Royalties 4.3 15.2 4.3
Reclamation and other closure accretion and
depreciation 1.9 0.3 1.7
Leases and other 2.3 13.8 1.0
All-in sustaining cost 254.3 273.1 37.5
AISC per pound ($/lb) 3.51 2.74 1.81
1 Includes immaterial amounts related to other segments.
2 By-product credits are presented net of the associated treatment and refining charges.
Three months ended December 31, 2025
Discontinued Operations Eagle
Total -
discontinued
operations($ millions, unless otherwise noted) (Ni)
Sales volumes (Contained metal):
Tonnes 1,756
Pounds (000s) 3,872
Production costs 38.0 38.0
Less: Royalties and other (2.8) (2.8)
35.2 35.2
Deduct: By-product credits1 (26.3) (26.3)
Add: Treatment and refining charges — —
Cash cost 8.9 8.9
Cash cost per pound ($/lb) 2.31
Add: Sustaining capital expenditure 3.9
Royalties 2.7
Reclamation and other closure accretion and
depreciation 0.8
Leases and other 3.5
All-in sustaining cost 19.9
AISC per pound ($/lb) 5.13
1 By-product credits are presented net of the associated treatment and refining charges.
43
===== SIDA 68 =====
Three months ended December 31, 2024
Continuing operations Candelaria Caserones Chapada Consolidated
Total -
continuing
operations1($ millions, unless otherwise noted) (Cu) (Cu) (Cu) (Cu)
Sales volumes (contained metal):
Tonnes 49,052 26,750 10,200 86,002
Pounds (000s) 108,141 58,973 22,487 189,601
Production costs 201.0 200.2 64.4 465.7 465.9
Less: Royalties and other (7.8) (14.2) (4.8) (26.8) (27.0)
193.2 186.0 59.6 438.9 438.9
Deduct: By-product credits2 (43.3) (46.6) (39.4) (129.3) (129.3)
Add: Treatment and refining charges 15.1 8.4 3.9 27.4 27.4
Cash cost 165.0 147.8 24.1 337.0 337.0
Cash cost per pound ($/lb) 1.53 2.51 1.07 1.78
Add: Sustaining capital expenditure 55.5 43.0 32.9
Royalties 4.7 7.7 2.7
Reclamation and other closure
accretion and depreciation 2.1 (4.5) 2.4
Leases and other 1.4 17.2 1.1
All-in sustaining cost 228.7 211.3 63.2
AISC per pound ($/lb) 2.12 3.58 2.81
1 Includes immaterial amounts related to other segments.
2 By-product credits are presented net of the associated treatment and refining charges.
Three months ended December 31, 2024
Discontinued operations Eagle Neves-Corvo Zinkgruvan
Total -
discontinued
operations($ millions, unless otherwise noted) (Ni) (Cu) (Zn)
Sales volumes (contained metal):
Tonnes 1,088 5,230 18,627
Pounds (000s) 2,399 11,531 41,066
Production costs 21.1 73.2 29.1 123.4
Less: Royalties and other (0.8) — — (0.8)
20.3 73.2 29.1 122.6
Deduct: By-product credits1 (7.8) (56.6) (19.1) (83.5)
Add: Treatment and refining charges — 4.7 7.4 12.1
Cash cost 12.5 21.2 17.5 51.2
Cash cost per pound ($/lb) 5.22 1.84 0.43
Add: Sustaining capital expenditure 5.2 12.7 22.5
Royalties 0.7 0.8 —
Reclamation and other closure
accretion and depreciation 1.7 1.2 0.7
Leases and other 2.7 2.9 0.1
All-in sustaining cost 22.8 38.9 40.7
AISC per pound ($/lb) 9.53 3.37 0.99
1 By-product credits are presented net of the associated treatment and refining charges.
44
===== SIDA 69 =====
Year ended December 31, 2025
Continuing operations Candelaria Caserones Chapada Consolidated
Total -
continuing
operations1($ millions, unless otherwise noted) (Cu) (Cu) (Cu) (Cu)
Sales volumes (contained metal):
Tonnes 140,500 138,287 42,040 320,827
Pounds (000s) 309,749 304,870 92,682 707,301
Production costs 783.9 854.5 306.8 1,945.2 1,948.1
Less: Royalties and other (18.6) (52.4) (22.3) (93.3) (96.2)
765.3 802.1 284.5 1,851.9 1,851.9
Deduct: By-product credits2 (193.1) (149.8) (220.4) (563.3) (563.3)
Add: Treatment and refining charges 22.9 8.3 5.0 36.2 36.2
Cash cost 595.1 660.6 69.1 1,324.8 1,324.9
Cash cost per pound ($/lb) 1.92 2.17 0.75 1.87
Add: Sustaining capital expenditure 224.4 156.3 96.8
Royalties 15.7 41.9 14.5
Reclamation and other closure
accretion and depreciation 7.9 2.7 6.8
Leases and other 7.5 63.5 4.1
All-in sustaining cost 850.6 925.0 191.3
AISC per pound ($/lb) 2.75 3.03 2.06
1 Includes immaterial amounts related to other segments.
2 By-product credits are presented net of the associated treatment and refining charges.
Year ended December 31, 2025
Discontinued Operations Eagle Neves-Corvo1 Zinkgruvan1 Total -
discontinued
operations($ millions, unless otherwise noted) (Ni) (Cu) (Zn)
Sales volumes (Contained metal):
Tonnes 7,651 6,745 20,698
Pounds (000s) 16,868 14,870 45,631
Production costs 150.7 90.2 36.9 277.8
Less: Royalties and other (15.5) (1.3) — (16.8)
135.2 88.9 36.9 261.0
Deduct: By-product credits2 (92.2) (67.0) (23.3) (182.5)
Add: Treatment and refining charges — 5.4 7.2 12.6
Cash cost 43.0 27.3 20.8 91.1
Cash cost per pound ($/lb) 2.55 1.84 0.46
Add: Sustaining capital expenditure 21.3 27.7 30.4
Royalties 12.6 1.2 —
Reclamation and other closure
accretion and depreciation 4.3 0.7 0.3
Leases and other 6.2 0.9 —
All-in sustaining cost 87.4 57.8 51.5
AISC per pound ($/lb) 5.18 3.89 1.13
1 Neves-Corvo and Zinkgruvan results are to April 16, 2025.
2 By-product credits are presented net of the associated treatment and refining charges.
45
===== SIDA 70 =====
Year ended December 31, 2024
Continuing operations Candelaria Caserones Chapada Consolidated
Total -
continuing
operations1($ millions, unless otherwise noted) (Cu) (Cu) (Cu) (Cu)
Sales volumes (contained metal):
Tonnes 158,017 113,867 39,615 311,499
Pounds (000s) 348,367 251,033 87,336 686,736
Production costs 726.6 776.2 282.7 1,785.5 1,786.7
Less: Royalties and other (21.6) (38.7) (15.0) (75.3) (76.5)
705.0 737.5 267.7 1,710.2 1,710.2
Deduct: By-product credits2 (159.8) (144.7) (147.8) (452.3) (452.3)
Add: Treatment and refining charges 58.2 36.8 17.9 112.9 112.9
Cash cost 603.5 629.6 137.7 1,370.8 1,370.8
Cash cost per pound ($/lb) 1.73 2.51 1.58 2.00
Add: Sustaining capital expenditure 275.7 144.0 107.8
Royalties 15.7 32.1 8.6
Reclamation and other closure
accretion and depreciation 8.6 (1.3) 10.2
Leases and other 9.1 69.0 3.6
All-in sustaining cost 912.6 873.4 267.9
AISC per pound ($/lb) 2.62 3.48 3.07
1 Includes immaterial amounts related to other segments.
2 By-product credits are presented net of the associated treatment and refining charges.
Year ended December 31, 2024
Discontinued operations Eagle Neves-Corvo Zinkgruvan
Total -
discontinued
operations
($ millions, unless otherwise noted) (Ni) (Cu) (Zn)
Sales volumes (contained metal):
Tonnes 5,662 26,721 68,086
Pounds (000s) 12,483 58,910 150,104
Production costs 111.9 323.2 122.1 557.2
Less: Royalties and other (8.0) (4.8) — (12.8)
103.9 318.4 122.1 544.4
Deduct: By-product credits1 (52.1) (213.2) (92.3) (357.6)
Add: Treatment and refining charges 0.6 23.9 31.5 56.0
Cash cost 52.4 129.1 61.2 242.7
Cash cost per pound ($/lb) 4.20 2.19 0.41
Add: Sustaining capital expenditure 21.2 89.3 65.7
Royalties 7.4 4.0 —
Reclamation and other closure
accretion and depreciation 6.8 5.2 4.0
Leases and other 6.9 3.3 0.3
All-in sustaining cost 94.7 230.9 131.2
AISC per pound ($/lb) 7.60 3.92 0.87
1 By-product credits are presented net of the associated treatment and refining charges.
46
===== SIDA 71 =====
Adjusted EBITDA
Adjusted EBITDA can be reconciled to Net earnings (loss) on the Company's Consolidated Statements of Earnings as follows:
Three months ended
December 31, Year ended December 31,
($ millions) 2025 2024 2025 2024 2023
Net earnings (loss) from continuing operations 912.3 (59.8) 1,417.7 267.6 183.0
Add back:
Depreciation, depletion and amortization 169.7 139.8 618.9 574.2 445.8
Finance costs, net 13.0 37.2 90.5 137.7 87.1
Income taxes expense (recovery) (488.2) 58.7 (270.0) 258.8 211.5
EBITDA - continuing operations 606.8 175.9 1,857.1 1,238.3 927.4
Unrealized foreign exchange (gain) loss 5.8 (10.8) 5.2 (10.9) 1.8
Unrealized losses (gains) on derivative contracts (7.8) 86.0 (29.0) 85.2 8.5
Revaluation gain on marketable securities (5.2) (0.9) (14.9) (7.4) (1.8)
Inventory write-down (reversal) 88.2 (26.6) 88.2 (26.6) —
Ojos del Salado sinkhole expenses (recoveries) (1.7) (10.0) 10.9 (9.5) 16.9
Gain on partial disposal and contribution to Vicuña — — (3.0) — —
Goodwill and asset impairment — 149.4 — 149.4 —
Write-down of assets — 4.2 — 22.1 —
Revaluation of Caserones purchase option — — — (11.7) 2.6
Caserones inventory fair value adjustment — — — — 39.9
Gain on disposal of subsidiary — — — — (5.7)
Other 0.3 (0.7) 2.6 (2.0) 3.0
Total adjustments - EBITDA 79.6 190.6 60.0 188.6 65.2
Adjusted EBITDA - continuing operations 686.4 366.5 1,917.1 1,426.9 992.6
Including discontinued operations:
Net earnings from discontinued operations 107.3 (344.6) 235.8 (328.9) 132.0
Add back:
Depreciation, depletion and amortization 5.3 41.1 22.3 188.9 207.8
Finance costs, net 0.8 2.9 9.0 13.4 15.6
Income taxes expense 20.1 (46.1) 26.6 (42.5) 5.1
EBITDA - discontinued operations 133.5 (346.7) 293.7 (169.1) 360.5
Asset impairment (reversal) (88.4) 396.1 (22.7) 396.1 —
Contingent consideration revaluation (30.6) — (47.0) — —
Gain on disposal of subsidiaries — — (106.3) — —
Partial suspension of underground operations at Eagle — 11.4 — 36.1 —
Unrealized foreign exchange loss (gain) — (1.0) 1.5 (0.2) (0.6)
Unrealized losses (gains) on derivative contracts — (0.5) (0.1) 18.6 13.5
Other (0.3) (0.2) 1.1 (1.4) (2.6)
Total adjustments - EBITDA discontinued operations (119.3) 405.8 (173.5) 449.2 10.3
Adjusted EBITDA - discontinued operations 14.2 59.1 120.2 280.1 370.8
Adjusted EBITDA (all operations) 700.6 425.6 2,037.3 1,707.0 1,363.4
47
===== SIDA 72 =====
Adjusted Earnings and Adjusted EPS
Adjusted Earnings and Adjusted EPS can be reconciled to Net earnings (loss) attributable to Lundin Mining Shareholders on
the Company's Consolidated Statements of Earnings as follows:
Three months ended
December 31,
Year ended
December 31,
($ millions, except share and per share amounts) 2025 2024 2025 2024 2023
Net earnings (loss) attributable to Lundin Mining
shareholders - continuing operations 659.9 (95.5) 1,047.2 125.4 109.3
Add back:
Total adjustments - EBITDA 79.6 190.6 60.0 188.6 65.2
Tax effect on adjustments (36.3) (33.2) (39.0) (29.9) (26.9)
Recognition of Caserones deferred tax asset (517.0) — (517.0) — —
Deferred tax arising from foreign exchange translation 12.0 45.1 (34.1) 12.7 28.8
Inventory write-down (reversal), included in depreciation 11.7 — 11.7 — —
Deferred tax arising from partial disposal and contribution
to Vicuña — — 9.0 — —
Deferred tax expense due to change in tax rate — — — — 40.2
Non-controlling interest on adjustments 153.8 (4.1) 150.1 (1.9) (22.9)
Total adjustments (296.2) 198.4 (359.3) 169.5 84.4
Adjusted earnings - continuing operations 363.7 102.9 687.9 294.9 193.7
Including discontinued operations:
Net earnings (loss) attributable to Lundin Mining
shareholders - discontinued operations1 107.3 (344.6) 235.8 (328.9) 132.0
Add back:
Total adjustments - EBITDA - discontinued operations (119.3) 405.8 (173.5) 449.2 10.3
Tax effect on adjustments 18.7 (44.9) 18.8 (56.1) —
Total adjustments (100.6) 360.9 (154.7) 393.1 10.3
Adjusted earnings - discontinued operations 6.7 16.3 81.1 64.1 142.3
Adjusted earnings (all operations) 370.4 119.2 769.0 359.0 336.0
Basic weighted average number of shares outstanding 855,891,254 776,720,828 855,632,088 774,825,230 772,532,260
Basic EPS from continuing operations attributable to
shareholders 0.77 (0.12) 1.22 0.16 0.14
Total adjustments per share (0.35) 0.26 (0.42) 0.22 0.11
Adjusted EPS - continuing operations 0.42 0.13 0.80 0.38 0.25
Basic EPS from discontinued operations attributable to
shareholders 0.13 (0.44) 0.28 (0.42) 0.17
Total adjustments per share (0.12) 0.46 (0.18) 0.51 0.02
Adjusted EPS - discontinued operations 0.01 0.02 0.09 0.08 0.19
Basic EPS attributable to shareholders 0.90 (0.57) 1.50 (0.26) 0.31
Total adjustments per share (0.46) 0.72 (0.60) 0.73 0.13
Adjusted EPS (all operations) 0.43 0.15 0.90 0.46 0.44
1 Represents Net earnings attributable to Lundin Mining Corporation shareholders less Net earnings from continuing operations attributable to
Lundin Mining Corporation shareholders.
48
===== SIDA 73 =====
Free Cash Flow from Operations and Free Cash Flow
Free Cash Flow from Operations and Free Cash Flow can be reconciled to Cash provided by operating activities on the
Company's Consolidated Statements of Cash Flows as follows:
Three months ended
December 31, Year ended December 31,
($ millions) 2025 2024 2025 2024 2023
Cash provided by operating activities related to
continuing operations 533.0 567.9 1,207.9 1,311.4 644.2
Sustaining capital expenditures (157.6) (131.4) (477.8) (527.9) (549.1)
General exploration and business development 12.9 10.9 43.5 42.1 38.3
Free cash flow from operations - continuing operations 388.3 447.4 773.6 825.6 133.4
General exploration and business development (12.9) (10.9) (43.5) (42.1) (38.3)
Expansionary capital expenditures (43.5) (50.5) (191.2) (243.6) (275.9)
Free cash flow - continuing operations 331.9 386.0 538.9 539.9 (180.8)
Cash provided by operating activities from discontinued
operations 27.9 52.4 134.7 207.5 372.4
Sustaining capital expenditures (3.9) (40.4) (79.4) (176.2) (178.2)
General exploration and business development 0.2 6.6 6.9 16.0 17.4
Free cash flow from operations - discontinued
operations 24.2 18.6 62.2 47.3 211.6
General exploration and business development (0.2) (6.6) (6.9) (16.0) (17.4)
Expansionary capital expenditures — — — — —
Free cash flow - discontinued operations 24.0 12.0 55.3 31.3 194.2
Free cash flow from operations (all operations) 412.5 466.0 835.8 872.9 345.0
Free cash flow (all operations) 355.9 398.0 594.2 571.2 13.4
49
===== SIDA 74 =====
Adjusted Operating Cash Flow and Adjusted Operating Cash Flow per Share
Adjusted Operating Cash Flow and Adjusted Operating Cash Flow per Share can be reconciled to Cash provided by operating
activities on the Company's Consolidated Statements of Cash Flows as follows:
Three months ended
December 31, Year ended December 31,
($ millions, except share and per share amounts) 2025 2024 2025 2024 2023
Cash provided by operating activities from continuing
operations 533.0 567.9 1,207.9 1,311.4 644.2
Changes in non-cash working capital items 132.1 (304.4) 414.0 (221.5) 65.9
Adjusted operating cash flow - continuing operations 665.1 263.5 1,621.9 1,089.9 710.1
Cash provided by operating activities related to
discontinued operations 27.9 52.4 134.7 207.5 372.4
Changes in non-cash working capital items (15.4) (2.0) (24.1) 5.2 (58.3)
Adjusted operating cash flow - discontinued operations 12.5 50.4 110.6 212.7 314.1
Adjusted operating cash flow (all operations) 677.6 313.9 1,732.5 1,302.6 1,024.2
Basic weighted average number of shares outstanding 855,891,254 776,720,828 855,632,088 774,825,230 772,532,260
Adjusted operating cash flow per share - continuing
operations 0.78 0.34 1.90 1.41 $ 0.92
Adjusted operating cash flow per share - discontinued
operations 0.01 0.06 0.12 0.27 $ 0.41
Adjusted operating cash flow per share (all operations) 0.79 0.40 2.02 1.68 $ 1.33
Net Cash (Debt)
Net Cash (Debt) can be reconciled to Debt, Current portion of debt and Cash and cash equivalents on the Company's
Consolidated Balance Sheets as follows:
($ millions) December 31, 2025 December 31, 2024 December 31, 2023
Debt (56.3) (1,412.4) (1,043.6)
Current portion of debt (180.8) (344.6) (165.0)
Less deferred financing fees (netted in above) (3.7) (7.7) (6.4)
(240.8) (1,764.7) (1,215.0)
Cash and cash equivalents 296.2 357.5 268.8
Add cash and cash equivalents related to assets classified as held
for sale 22.0 74.8 —
Net cash (debt) 77.4 (1,332.4) (946.2)
50
===== SIDA 75 =====
Other Information and Advisories
Related Party Transactions
The Company enters into related party transactions that are in the normal course of business and on an arm’s length basis.
Related party disclosures can be found in Note 29 “Related Party Transactions” of the Company’s consolidated financial
statements for the year ended December 31, 2025.
Changes in Accounting Policies
The Company’s consolidated financial statements, including comparatives, have been prepared in compliance with IFRS.
The Company’s material accounting policies, including any changes in accounting policies, are described in Note 2 ‘Basis of
Presentation and Summary of Material Accounting Policies’ of the Company's consolidated financial statements for the year
ended December 31, 2025.
Critical Accounting Estimates and Judgements
The preparation of consolidated financial statements in conformity with IFRS requires management to make judgements,
estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities,
income and expenses. Actual results may differ from these estimates. Estimates and underlying assumptions are reviewed
at each period end. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in
any future periods affected.
For further information on the Company’s significant accounting estimates and judgements, refer to Note 2 “Basis of
Presentation and Summary of Material Accounting Policies” of the Company’s consolidated financial statements for the
year ended December 31, 2025.
Disclosure Controls and Procedures
Disclosure controls and procedures have been designed to provide reasonable assurance that all material information
related to the Company is identified and communicated on a timely basis. Management of the Company, under the
supervision of the President and Chief Executive Officer and the Executive Vice President and Chief Financial Officer, is
responsible for the design and operation of disclosure controls and procedures. Management has, under the supervision of
the President and Chief Executive Officer and the Executive Vice President and Chief Financial Officer, evaluated the
effectiveness of the Company’s disclosure controls and procedures and has concluded that they were effective as at
December 31, 2025.
Internal Control over Financial Reporting (“ICFR”)
Management of the Company, under the supervision of the President and Chief Executive Officer and the Executive Vice
President and Chief Financial Officer, is responsible for establishing and maintaining adequate ICFR. The Company’s ICFR is
designed to provide reasonable assurance regarding the reliability of financial reporting and preparation of financial
statements for external purposes in accordance with IFRS. However, due to inherent limitations ICFR may not prevent or
detect all misstatements and fraud. Management will continue to monitor the effectiveness of its ICFR and may make
modifications from time to time as considered necessary.
Management assesses the effectiveness of the Company’s ICFR using the Internal Control – Integrated Framework (2013
Framework) issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Management,
under the supervision of the President and Chief Executive Officer and the Executive Vice President and Chief Financial
Officer, conducted an evaluation of the effectiveness of ICFR and concluded that it was effective as at December 31, 2025.
There have been no changes in the Company’s ICFR during the three months ended December 31, 2025 that have
materially affected, or are reasonably likely to materially affect, the Company’s ICFR.
51
===== SIDA 76 =====
Risks and Uncertainties
The Company’s business activities are subject to a variety and wide range of inherent risks and uncertainties. Any of these
risks could have an adverse effect on the Company, its business and prospects, and could cause actual outcomes and results
to differ materially from those described in forward-looking statements relating to the Company.
The development of the Vicuña Project requires significant capital commitments from the Company, and additional funding,
beyond debt, may be required to advance the project to completion. Such additional funding may take the form of a
partnership, joint arrangement, royalty, stream or other arrangement (or a combination thereof) for the Vicuña Project, any
of which would dilute the Company’s existing interest in the Vicuña Project. The Company may also be required or elect to
pursue equity financing, which could have a dilutive effect on existing security holders if shares, options, warrants or other
convertible securities are issued.
The Company’s ability to obtain additional financing for the Vicuña Project in the future will depend, in part, on prevailing
capital market conditions and the Company’s financial performance. Failure to secure adequate financing on a timely basis
may cause the Company to postpone, abandon, reduce or terminate its development activities in respect of the Vicuña
Project and could have a material adverse effect on the Company’s business, results of operations, financial condition and
price of common shares.
In June 2024, under President Javier Milei, the Argentine Congress passed the “Bases Law” and the Tax Measures Law
effecting a series of blanket reforms, and the RIGI incentive regime for large investments, bringing significant implications
across industries. If the Vicuña Project is accepted into the RIGI framework, significant economic benefits are expected to
be provided. If, however, the Vicuña Project is not accepted into the RIGI framework in a timely manner or at all, or if the
RIGI framework does not work as intended or anticipated, it may have a material adverse impact on the Company’s
operations and financial conditions, strategic vision, growth opportunities, and accuracy of cost estimates and economic
analysis of the Vicuña Project, as well as material adverse tax effects.
In addition, the Company’s exploration, acquisition, development and operational activities generally require significant
investment of resources and capital. The Company allocates such resources and capital to support business objectives, and
the availability of required resources and capital is subject to market conditions and the Company’s financial position.
The Company has limited financial resources and there is no assurance that sufficient additional funding or financing will be
available to the Company or its direct and indirect subsidiaries on acceptable terms, or at all, for further exploration or
development of its properties, including the development of the Vicuña Project, or to fulfill its obligations under any
applicable agreements.
The Company may incur substantial debt from time to time to finance working capital, capital expenditures, investments or
acquisitions or for other purposes. If the Company does so, the risks related to the Company’s indebtedness could intensify,
including, among other things: substantial interest and capital payments; increased difficulty in satisfying existing debt
obligations; limitations on the ability to obtain additional financing, or imposed requirements to make non-strategic
divestitures; imposed hedging requirements; explicit or implicit restrictions on the Company’s cash flows for capital
investment, dividends or distributions, opportunistic acquisitions and other business needs; increased vulnerability to
general adverse economic and industry conditions; interest rate risk exposure as borrowings may be at variable rates of
interest; decreased flexibility in planning for and reacting to changes in the industry in which it competes; reduced
competitiveness as compared to less leveraged competitors; and increased cost of additional borrowing.
The terms of the revolving credit facility require the Company to satisfy various affirmative and negative covenants and to
meet certain financial ratios and tests. These covenants limit, among other things, the Company’s ability to incur further
indebtedness if doing so would cause it to fail to meet certain financial covenants, create certain liens on assets or engage
in certain types of transactions. A failure to comply with these covenants, including a failure to meet the financial tests or
ratios, would likely result in an event of default under the revolving credit facility and would allow the lenders to restrict
future loans or accelerate the debt, which could materially and adversely affect the Company’s business, financial condition
and results of operations, its ability to meet payment obligations under its debt and the price of its common shares. As at
December 31, 2025, the Company is in compliance with its debt covenants.
The Company may issue additional securities to raise funds, to pay for acquisitions or for other reasons. The Company
cannot predict the size of future issuances of securities or the effect, if any, that future issuances and sales of securities will
52
===== SIDA 77 =====
have on the market price of common shares. Sales or issuances of substantial numbers of common shares, or the
expectation that such sales could occur, may adversely affect prevailing market prices of the Company’s common shares. In
connection with any issuance of common shares, investors will suffer dilution to their voting power and the Company may
experience dilution in its earnings per share.
The Company is exposed to various counterparty risks including, among others: financial institutions that hold the
Company’s cash; companies that have payables to the Company, including concentrate customers; the Company’s
insurance providers; counterparties to the Company's derivative contracts; the Company’s lenders and other banking
counterparties; companies that have received deposits from the Company for the future delivery of equipment; and third
parties that have agreed to indemnify the Company upon the occurrence of certain events. The Company is also subject to
customer counterparty and credit risks and concentration risk associated with trade receivables.
The Company maintains relationships with various banking partners for its operating activities in the jurisdictions in which
the Company operates. The Company’s access to funds under its credit facilities or other debt arrangements is dependent
on the ability of the financial institutions that are counterparties to the facilities to meet their funding commitments.
Default by financial institutions could require the Company to take measures to conserve cash until the markets stabilize or
until alternative credit or other funding arrangements for the Company’s business needs can be obtained.
If market prices for metals fall below the Company’s full production costs and remain at such levels for any sustained period
of time, the Company may experience losses and may decide to discontinue mining operations or development of a project
at one or more of its properties. If the prices drop significantly, the economic prospects of the mines and projects in which
the Company has an interest could be significantly reduced or rendered uneconomic, in which case the Company may need
to restate its Mineral Resource and Mineral Reserve estimates. Low metal prices will affect the Company’s liquidity, and if
they persist for an extended period of time, the Company may have to look for other sources of cash flow to maintain
liquidity until metal prices recover. A sustained and material impact on the Company’s liquidity may also impact the
Company’s ability to comply with financial covenants under its credit facilities.
In Brazil, regulatory requirements for tailings facility management and reporting have steadily increased in the past several
years and have required the Chapada Mine to continue to adapt its practices and procedures to ensure legal and regulatory
compliance. On October 17, 2025 the National Mining Agency in Brazil (“ANM”) published Resolution No. 220/2025
(“ANM-220”), establishing new rules applicable to mining dams within the scope of ANM which come into effect in 2027.
Such rules include restrictions on the activities in tailings dam self-rescue zones (“ZAS”) and restrictions on the workers
allowed in the ZAS to those that are strictly necessary for the performance of select activities related to tailings dams. The
Company is currently evaluating the potential impacts of ANM-220 on its Chapada operations, including studies on
potential initiatives for compliance with ANM-220. State and federal laws and regulations, including ANM-220 could
significantly increase the costs associated with the Company’s operations. Non-compliance with applicable laws, regulations
and permitting requirements (including allegations of such) may result in civil litigation, administrative or criminal sanctions
or regulatory enforcement actions, including orders issued by regulatory or judicial authorities causing operations to cease
or be curtailed or causing the withdrawal of mining licenses, and the imposition of fines, corrective measures requiring
material capital expenditure or remedial action resulting in materially increased costs of compliance, reputational damage
and potentially impaired ability to secure future approvals and permits.
In certain jurisdictions in which the Company operates, there are certain restrictions on the ownership of land by foreign
beneficial owners. For example, in Brazil, there are limitations on the amount of rural land that can be held by foreign
beneficial owners and these restrictions apply at both the individual and aggregate level across all foreign beneficial owners
on a municipality-by-municipality basis. Any challenges, disputes, or termination of any one or more of the Company’s
mining, exploration or other concessions, property holdings or titles could have a material adverse effect on the Company’s
financial condition or results of operations.
In respect of the 2017 taxation year, the CRA issued a reassessment denying the Company’s 2007 election to increase the
tax cost of its investment in a subsidiary. The reassessment proposes an increase in taxable income of approximately $456
million, which would result in additional income taxes payable of approximately $114.1 million and interest of
approximately $46.2 million. The Company filed a Notice of Objection on January 28, 2026 and will vigorously and
expeditiously defend its tax filing position through CRA's Appeals Division and, if required, court proceedings.
The foregoing is not an exhaustive description of the risks and uncertainties to which the Company’s business activities are
subject. For additional discussion on Lundin Mining’s risks and uncertainties, refer to the “Risks and Uncertainties” section
53
===== SIDA 78 =====
of the Company’s most recent Annual Information Form (“AIF”) and the “Cautionary Statement on Forward-Looking
Information” section of this MD&A.
National Instrument 43-101 Compliance
The technical report summarizing the results of the Study, including the Updated Vicuña Mineral Resource, is being
prepared in accordance with National Instrument 43-101 – Standards of Disclosure for Mineral Projects (“NI 43-101”) and
will be filed under the Company's profile on SEDAR+ at www.sedarplus.ca in accordance with applicable securities rules. The
Qualified Persons named below have reviewed and verified the scientific and technical information in respect of the Study
in this document and approve the written disclosure of such information.
The Qualified Persons are:
Mr. Luke Evans, P.Eng., SLR Consulting (Canada) Ltd.
Mr. Paul Daigle, P.Geo., AGP Mining Consultants Inc.
Mr. Sean Horan, P.Geo., Resource Modelling Solutions Ltd.
Mr. Jeffery Austin, P.Eng., International Metallurgical and Environmental Inc.
Mr. Rod Clary, P.E., Design, Fluor Corp.
Mr. Kirk Hanson, P.E., KH Mining LLC
Mr. Dustin Smiley, P.Eng., Vicuña Corp.
Mr. Daniel Ruane, P.Eng., Knight Piesold Ltd.
Each of the foregoing individuals is a “Qualified Person” as defined by NI 43-101. The Updated Vicuña Mineral Resource
estimates are shown on a 100% basis and have an effective date of October 31, 2025. For further information related to the
Study, including the Updated Vicuña Mineral Resource, and the key assumptions, parameters, and methods used to
estimate the Updated Vicuña Mineral Resource, risks and cautionary statements, see the Company’s news release dated
February 16, 2026.
The scientific and technical information in this document other than that pertaining to the results of the Vicuña PEA
(including the Updated Vicuña Mineral Resource) has been reviewed and approved in accordance with NI 43-101 by
Eduardo Cortés, Registered Member (Comisión Calificadora de Competencias en Recursos y Reservas Mineras (Chilean
Mining Commission)), Vice President, Mining & Resources at Lundin Mining, a "Qualified Person" under NI 43-101. Mr.
Cortés has verified the data disclosed in this document and no limitations were imposed on his verification process.
Other Information
Additional information regarding the Company, including the Company’s AIF, can be obtained on
SEDAR+ (www.sedarplus.com) and on the Company’s website (www.lundinmining.com).
54
===== SIDA 79 =====
Outstanding Share Data
The table below summarizes the Company’s common shares and securities convertible into common shares as at
February 19, 2026.
February 19,
2026
Common shares issued and outstanding 854,533,639
Stock options outstanding
(weighted average exercise price of C$10.82) 3,609,917
Time vesting share units1 1,444,818
Performance vesting share units2 1,343,604
1 Time vesting share units represent the right to receive one common share (subject to adjustments) issued from treasury.
2 Performance vesting share units (“PSU”) represent the right to receive a variable number of common shares (subject to adjustments)
issued from treasury contingent upon achieving applicable performance vesting conditions. The number of common shares listed above
in respect of PSU assumes that 100% of PSU granted (without change) will vest and be paid out in common shares on a one for one
basis. However, as noted, the final number of PSU that may be earned and redeemed may be higher or lower than the PSU initially
granted.
55
===== SIDA 80 =====
Consolidated Financial Statements of
Lundin Mining Corporation
December 31, 2025
===== SIDA 81 =====
Management’s Report
The accompanying consolidated financial statements of Lundin Mining Corporation ("Lundin Mining" or the “Company”)
and other information contained in the management’s discussion and analysis are the responsibility of management and
have been approved by the Board of Directors. The consolidated financial statements have been prepared by management
in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board
(“IFRS Accounting Standards”) as outlined in Part 1 of the Handbook of the Chartered Professional Accountants (“CPA”) of
Canada, and include some amounts that are based on management’s estimates and judgment.
The Board of Directors carries out its responsibility for the consolidated financial statements principally through its Audit
Committee, which is comprised solely of independent directors. The Audit Committee reviews the Company’s annual
consolidated financial statements and recommends its approval to the Board of Directors. The Company’s auditors have full
access to the Audit Committee, with and without management being present. These consolidated financial statements have
been audited by PricewaterhouseCoopers LLP, Chartered Professional Accountants.
(Signed) Jack Lundin (Signed) Teitur Poulsen
President and Chief Executive Officer Executive Vice President and Chief Financial Officer
Vancouver, British Columbia, Canada
February 19, 2026
===== SIDA 82 =====
PricewaterhouseCoopers LLP
PwC Place, 250 Howe Street, Suite 1400
Vancouver, British Columbia, Canada V6C 3S7
T.: +1 604 806 7000, F.: +1 604 806 7806
Fax to mail: ca_vancouver_main_fax@pwc.com
“PwC” refers to PricewaterhouseCoopers LLP, an Ontario limited liability partnership.
Independent auditor’s report
To the Shareholders of Lundin Mining Corporation
Our opinion
In our opinion, the accompanying consolidated financial statements present fairly, in all material respects,
the financial position of Lundin Mining Corporation and its subsidiaries (together, the Company) as at
December 31, 2025 and 2024, and its financial performance and its cash flows for the years then ended in
accordance with International Financial Reporting Standards as issued by the International Accounting
Standards Board (IFRS Accounting Standards).
What we have audited
The Company’s consolidated financial statements comprise:
•the consolidated balance sheets as at December 31, 2025 and 2024;
•the consolidated statements of earnings (loss) for the years then ended;
•the consolidated statements of comprehensive income (loss) for the years then ended;
•the consolidated statements of changes in equity for the years then ended;
•the consolidated statements of cash flows for the years then ended; and
•the notes to the consolidated financial statements, comprising material accounting policy information and
other explanatory information.
===== SIDA 83 =====
Basis for opinion
We conducted our audit in accordance with Canadian generally accepted auditing standards. Our
responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of
the consolidated financial statements section of our report.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our
opinion.
Independence
We are independent of the Company in accordance with the ethical requirements that are relevant to our
audit of the consolidated financial statements in Canada. We have fulfilled our other ethical responsibilities
in accordance with these requirements.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our
audit of the consolidated financial statements for the year ended December 31, 2025. These matters were
addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our
opinion thereon, and we do not provide a separate opinion on these matters.
Key audit matter How our audit addressed the key audit matter
Chapada cash-generating unit (CGU) goodwill
impairment assessment
Refer to note 2 – Basis of presentation and summary of
material accounting policies and note 10 – Goodwill and
asset impairment to the consolidated financial statements.
The Company’s total carrying amount of goodwill as at
December 31, 2025 was $134 million, which related to the
Chapada CGU. The Company’s goodwill is required to be
tested annually for impairment or when events or changes in
circumstances indicate that the related carrying amount may
not be recoverable. When the recoverable amount of the
Our approach to addressing the matter included the following
procedures, among others:
Tested how management estimated the recoverable
amount of the Chapada CGU, which included the
following:
‒ Tested the underlying data used by management
in the discounted cash flow model and market-
based valuation.
‒ Evaluated the reasonableness of significant
assumptions such as future metal prices, foreign
exchange rate and production and capital
expenditures by (i) comparing future metal prices
===== SIDA 84 =====
Key audit matter How our audit addressed the key audit matter
CGU is less than the carrying amount of that CGU, an
impairment loss is recognized.
The recoverable amount of the Chapada CGU was based on
a fair value less cost of disposal method using a discounted
cash flow model and market-based approach. Management
applied significant judgment in estimating the recoverable
amount of the Chapada CGU. Significant assumptions used
by management to determine the recoverable amounts
include future metal prices, production based on estimated
quantities of mineral reserves and mineral resources,
production and capital expenditures, foreign exchange rate,
in-situ multiplies and discount rate. The recoverable amount
of the Chapada CGU determined by management exceeded
its carrying value, and as a result, no impairment loss was
recorded. Management’s estimates of production based on
estimated quantities of mineral reserves and mineral
resources are based on information compiled by qualified
persons (management’s experts).
We considered this a key audit matter due to the significant
auditor effort, subjectivity and significant judgment in
performing procedures to test significant assumptions used
by management in determining the fair value of the Chapada
CGU. Professionals with specialized skill and knowledge in
the field of valuation assisted us in performing our
procedures.
and foreign exchange rate with external market
and industry data; (ii) comparing future production
and capital expenditures against current and past
performance; and (iii) assessing whether these
assumptions were consistent with evidence
obtained in other areas of the audit.
‒ The work of management's experts was used in
performing the procedures to evaluate the
reasonableness of the estimates associated with
the production based on estimated quantities of
mineral reserves and mineral resources. As a basis
for using this work, the competence, capabilities
and objectivity of management’s experts were
evaluated, the work performed was understood
and the appropriateness of the work as audit
evidence was evaluated. The procedures
performed also included evaluation of the methods
and assumptions used by management’s experts,
tests of the data used by management’s experts
and an evaluation of their findings.
‒ Professionals with specialized skill and knowledge
in the field of valuation assisted in assessing the
following: (i) appropriateness of the discounted
cash flow model and market-based approach to
determine the recoverable amount of the Chapada
CGU; and (ii) the reasonableness of the discount
rate and in-situ multiples.
Recoverability of the Caserones deferred tax asset
Refer to note 2 – Basis of presentation and summary of
material accounting policies and note 25 – Current and
deferred income taxes to the consolidated financial
statements.
The Company’s total deferred tax asset as at December 31,
2025 was $720 million, of which $665 million related to the
Caserones mine (“Caserones”). Deferred tax assets are
Our approach to addressing the matter included the following
procedures, among others:
Tested how management estimated the recoverability of
the Caserones deferred tax asset, which included the
following:
‒ Tested the underlying data used by management
in determining the future taxable income.
===== SIDA 85 =====
Key audit matter How our audit addressed the key audit matter
recognized to the extent that it is probable that future taxable
income will be available against which deductible temporary
differences or tax loss carry-forwards can be utilized. The
determination of the ability of the Company to utilize tax loss
carry-forwards and deductible temporary differences to
recognize deferred tax assets requires management to
exercise judgment and make certain assumptions about the
future performance of the Company. Management is required
to assess whether it is “probable” that the Company will
benefit from these prior losses and other deductible
temporary differences.
Caserones has approximately $3.9 billion in net operating
losses arising prior to the acquisition by the Company which
can be applied to future taxable income over the mine life to
reduce taxes payable in future years. In determining the
amount of the net operating losses and deductible temporary
differences which are probable to be utilized, management
has evaluated future taxable income and assessed the
probability of achieving the taxable income projections over
different planning horizons. Significant assumptions used by
management to determine the future taxable income include
future metal prices, production based on estimated quantities
of mineral reserves and mineral resources (R&R), foreign
exchange rates and production costs. Management’s
estimates of production based on estimated quantities of
R&R are based on information compiled by qualified persons
(management’s experts).
As estimation uncertainty increases with the length of the
forecast period, progressively less reliance is placed on
longer-dated forecasts when assessing the recoverability of
deferred tax assets and therefore management has used
significant judgment in assessing the probability of achieving
various levels of future taxable income.
We considered this a key audit matter due to the significant
auditor effort, subjectivity and judgment in performing
procedures to test significant assumptions used to determine
‒ Assessed the appropriateness of management’s
methodology to estimate future taxable income.
‒ Evaluated the reasonableness of significant
assumptions used in the determination of future
taxable income such as future metal prices, foreign
exchange rates and production costs by
(i) comparing future metal prices and foreign
exchange rates with external market and industry
data; (ii) comparing future production costs to
current and past performance of Caserones; and
(iii) assessing whether these assumptions were
consistent with evidence obtained in other areas of
the audit.
‒ The work of management's experts was used in
performing the procedures to evaluate the
reasonableness of the production based on
estimated of quantities of R&R. As a basis for
using this work, the competence, capabilities and
objectivity of management's experts were
evaluated, the work performed was understood
and the appropriateness of the work as audit
evidence was evaluated. The procedures
performed also included evaluation of the methods
and assumptions used by management’s experts,
tests of the data used by management’s experts
and an evaluation of their findings.
‒ Assessed the reasonableness of management’s
judgment regarding the probability of achieving
various levels of future taxable income based on
consideration of different planning horizons and
current and past operating performance.
===== SIDA 86 =====
Key audit matter How our audit addressed the key audit matter
the future taxable income, and due to the significant
judgment used by management in assessing the probability
of achieving the various levels of future taxable income.
Other information
Management is responsible for the other information. The other information comprises the Management’s
Discussion and Analysis, which we obtained prior to the date of this auditor’s report, and the information,
other than the consolidated financial statements and our auditor’s report thereon, included in the annual
report that will be filed with the Swedish regulatory authority, which is expected to be made available to us
after that date.
Our opinion on the consolidated financial statements does not cover the other information and we do not
and will not express any form of assurance conclusion thereon.
In connection with our audit of the consolidated financial statements, our responsibility is to read the other
information identified above and, in doing so, consider whether the other information is materially
inconsistent with the consolidated financial statements or our knowledge obtained in the audit, or otherwise
appears to be materially misstated.
If, based on the work we have performed on the other information that we obtained prior to the date of this
auditor’s report, we conclude that there is a material misstatement of this other information, we are required
to report that fact. We have nothing to report in this regard. When we read the information, other than the
consolidated financial statements and our auditor’s report thereon, included in the annual report that will be
filed with the Swedish regulatory authority, if we conclude that there is a material misstatement therein, we
are required to communicate the matter to those charged with governance.
===== SIDA 87 =====
Responsibilities of management and those charged with governance for the
consolidated financial statements
Management is responsible for the preparation and fair presentation of the consolidated financial
statements in accordance with IFRS Accounting Standards, and for such internal control as management
determines is necessary to enable the preparation of consolidated financial statements that are free from
material misstatement, whether due to fraud or error.
In preparing the consolidated financial statements, management is responsible for assessing the Company’s
ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using
the going concern basis of accounting unless management either intends to liquidate the Company or to
cease operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the Company’s financial reporting process.
Auditor’s responsibilities for the audit of the consolidated financial statements
Our objectives are to obtain reasonable assurance about whether the consolidated financial statements as a
whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report
that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an
audit conducted in accordance with Canadian generally accepted auditing standards will always detect a
material misstatement when it exists. Misstatements can arise from fraud or error and are considered
material if, individually or in the aggregate, they could reasonably be expected to influence the economic
decisions of users taken on the basis of these consolidated financial statements.
As part of an audit in accordance with Canadian generally accepted auditing standards, we exercise
professional judgment and maintain professional skepticism throughout the audit. We also:
•Identify and assess the risks of material misstatement of the consolidated financial statements, whether
due to fraud or error, design and perform audit procedures responsive to those risks, and obtain audit
evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of not detecting a
material misstatement resulting from fraud is higher than for one resulting from error, as fraud may
involve collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.
===== SIDA 88 =====
•Obtain an understanding of internal control relevant to the audit in order to design audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness
of the Company’s internal control.
•Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates
and related disclosures made by management.
•Conclude on the appropriateness of management’s use of the going concern basis of accounting and, based
on the audit evidence obtained, whether a material uncertainty exists related to events or conditions that
may cast significant doubt on the Company’s ability to continue as a going concern. If we conclude that a
material uncertainty exists, we are required to draw attention in our auditor’s report to the related
disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our
opinion. Our conclusions are based on the audit evidence obtained up to the date of our auditor’s report.
However, future events or conditions may cause the Company to cease to continue as a going concern.
•Evaluate the overall presentation, structure and content of the consolidated financial statements,
including the disclosures, and whether the consolidated financial statements represent the underlying
transactions and events in a manner that achieves fair presentation.
•Plan and perform the group audit to obtain sufficient appropriate audit evidence regarding the financial
information of the entities or business units within the Company as a basis for forming an opinion on the
consolidated financial statements. We are responsible for the direction, supervision and review of the
audit work performed for purposes of the group audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding, among other matters, the planned scope
and timing of the audit and significant audit findings, including any significant deficiencies in internal
control that we identify during our audit.
We also provide those charged with governance with a statement that we have complied with relevant ethical
requirements regarding independence, and to communicate with them all relationships and other matters
that may reasonably be thought to bear on our independence, and where applicable, related safeguards.
===== SIDA 89 =====
From the matters communicated with those charged with governance, we determine those matters that were
of most significance in the audit of the consolidated financial statements of the current period and are
therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation
precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a
matter should not be communicated in our report because the adverse consequences of doing so would
reasonably be expected to outweigh the public interest benefits of such communication.
The engagement partner on the audit resulting in this independent auditor’s report is Mark Patterson.
Chartered Professional Accountants
Vancouver, British Columbia
February 19, 2026
/s/PricewaterhouseCoopers LLP
===== SIDA 90 =====
LUNDIN MINING CORPORATION
CONSOLIDATED BALANCE SHEETS As at
(in millions of US dollars) December 31,
2025
December 31,
2024
ASSETS
Cash and cash equivalents (Note 5) $ 296.2 $ 357.5
Trade and other receivables (Note 6) 824.6 510.9
Income taxes receivable 27.3 14.4
Inventories (Note 7) 587.6 607.4
Marketable securities 8.1 50.1
Current portion of derivative assets (Note 26) 9.8 1.0
Other current assets (Note 3) 53.6 5.9
Assets held for sale (Note 3) 229.1 1,389.7
Total current assets 2,036.3 2,936.9
Restricted funds 16.4 8.7
Long-term inventory (Note 7) 802.1 871.9
Contingent consideration and other non-current assets (Note 8) 75.5 19.1
Mineral properties, plant and equipment (Note 9) 7,036.4 6,244.6
Deferred tax assets (Note 25) 719.6 191.3
Goodwill (Note 10) 134.3 134.3
8,784.3 7,469.9
Total assets $ 10,820.6 $ 10,406.8
LIABILITIES
Trade and other payables (Note 11) $ 700.2 $ 674.2
Income taxes payable 75.7 128.3
Current portion of derivative liabilities (Note 26) 43.0 39.4
Current portion of debt (Note 12) 180.8 344.6
Current portion of lease liabilities (Note 13) 45.6 50.6
Current portion of deferred revenue (Note 14) 56.3 60.6
Current portion of reclamation and other closure provisions (Note 15) 12.1 20.9
Liabilities held for sale (Note 3) 126.8 393.1
Total current liabilities 1,240.5 1,711.7
Derivative liabilities (Note 26) — 24.5
Debt (Note 12) 56.3 1,412.4
Lease liabilities (Note 13) 166.9 198.6
Deferred revenue (Note 14) 404.2 447.1
Reclamation and other closure provisions (Note 15) 276.1 323.3
Deferred consideration and other long-term liabilities (Note 16) 118.9 129.6
Deferred tax liabilities (Note 25) 611.6 643.8
1,634.0 3,179.3
Total liabilities 2,874.5 4,891.0
SHAREHOLDERS' EQUITY
Share capital (Note 17) 5,316.5 4,585.6
Contributed surplus 56.3 51.3
Accumulated other comprehensive loss (23.2) (375.8)
Retained earnings 1,270.2 161.1
Equity attributable to Lundin Mining Corporation shareholders 6,619.8 4,422.2
Non-controlling interests (Note 18) 1,326.3 1,093.6
Total shareholders' equity 7,946.1 5,515.8
Total liabilities and shareholders' equity $ 10,820.6 $ 10,406.8
Commitments and contingencies (Note 27)
Subsequent events (Note 33)
The accompanying notes are an integral part of these consolidated financial statements.
APPROVED BY THE BOARD OF DIRECTORS
(Signed) Adam I. Lundin - Director (Signed) Dale C. Peniuk - Director
- 1 -
===== SIDA 91 =====
LUNDIN MINING CORPORATION
CONSOLIDATED STATEMENTS OF EARNINGS (LOSS)
For the years ended December 31, 2025 and 2024
(in millions of US dollars, except for shares and per share amounts)
2025 2024
Continuing Operations:
Revenue (Note 19) $ 4,053.2 $ 3,270.1
Cost of goods sold
Production costs (Note 20) (1,948.1) (1,786.7)
Depreciation, depletion and amortization (618.9) (574.2)
Inventory (write-down) reversal (Note 7) (88.2) 26.6
Gross profit 1,398.0 935.8
General and administrative expenses (Note 21) (63.9) (58.3)
Exploration and business development (Note 22) (43.5) (42.1)
Finance income (Note 23) 14.6 16.1
Finance costs (Note 23) (105.1) (153.8)
Other expense (Note 24) (52.4) (21.9)
Goodwill and asset impairment (Note 10) — (149.4)
Earnings before income taxes from continuing operations 1,147.7 526.4
Current tax expense (Note 25) (299.7) (294.9)
Deferred tax recovery (Note 25) 569.7 36.1
Net earnings from continuing operations $ 1,417.7 $ 267.6
Net earnings (loss) from discontinued operations, net of taxes (Note 3) 235.8 (328.9)
Net earnings (loss) $ 1,653.5 $ (61.3)
Net earnings from continuing operations attributable to:
Lundin Mining Corporation shareholders $ 1,047.2 $ 125.4
Non-controlling interests (Note 18) 370.5 142.2
Net earnings from continuing operations $ 1,417.7 $ 267.6
Net earnings (loss) attributable to:
Lundin Mining Corporation shareholders $ 1,283.0 $ (203.5)
Non-controlling interests (Note 18) 370.5 142.2
Net earnings (loss) $ 1,653.5 $ (61.3)
Basic and diluted earnings per share from continuing operations attributable to Lundin Mining
Corporation shareholders: $ 1.22 $ 0.16
Basic earnings (loss) per share from discontinued operations attributable to Lundin Mining
Corporation shareholders: $ 0.28 $ (0.42)
Diluted earnings (loss) per share from discontinued operations attributable to Lundin Mining
Corporation shareholders: $ 0.27 $ (0.42)
Basic earnings (loss) per share attributable to Lundin Mining Corporation shareholders: $ 1.50 $ (0.26)
Diluted earnings (loss) per share attributable to Lundin Mining Corporation shareholders: $ 1.49 $ (0.26)
Weighted average shares outstanding (Note 17) 855,632,088 774,825,230
Weighted average diluted shares outstanding (Note 17) 858,736,530 777,569,041
The accompanying notes are an integral part of these consolidated financial statements.
- 2 -
===== SIDA 92 =====
LUNDIN MINING CORPORATION
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
For the years ended December 31, 2025 and 2024
(in millions of US dollars)
2025 2024
Net earnings (loss) $ 1,653.5 $ (61.3)
Other comprehensive income (loss), net of taxes
Item that will not be reclassified to net earnings:
Remeasurements for post-employment benefit plans 1.0 0.6
Item that may be reclassified subsequently to net earnings:
Effects of foreign exchange 79.1 (79.7)
Item that was reclassified to net earnings:
Reclassification of cumulative foreign currency translation reserve to statement of
earnings on disposal of discontinued operations 269.2 —
Other comprehensive income (loss) 349.3 (79.1)
Total comprehensive income (loss) $ 2,002.8 $ (140.4)
Comprehensive income (loss) attributable to:
Lundin Mining Corporation shareholders $ 1,632.1 $ (282.7)
Non-controlling interests 370.7 142.3
Total comprehensive income (loss) $ 2,002.8 $ (140.4)
Total comprehensive income (loss) attributable to Lundin Mining Corporation
shareholders arising from:
Continuing operations $ 1,048.0 $ 125.7
Discontinued operations 584.1 (408.4)
Comprehensive income (loss) attributable to Lundin Mining Corporation shareholders $ 1,632.1 $ (282.7)
The accompanying notes are an integral part of these consolidated financial statements.
- 3 -
===== SIDA 93 =====
LUNDIN MINING CORPORATION
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY
For the years ended December 31, 2025 and 2024
(in millions of US dollars, except for shares)
Number of
shares
Share
capital
Contributed
surplus
Accumulated
other
comprehensive
loss
Retained
earnings
Non-
controlling
interests Total
Balance, December 31, 2024 774,102,971 $ 4,585.6 $ 51.3 $ (375.8) $ 161.1 $ 1,093.6 $ 5,515.8
Acquisition of Filo Corp. (Note 4) 94,074,959 799.8 — — — — 799.8
Distributions — — — — — (138.0) (138.0)
Exercise of share-based awards 1,687,641 16.3 (6.1) — — — 10.2
Share-based compensation — — 11.1 — — — 11.1
Dividends declared (Note 17(f)) — — — — (105.6) — (105.6)
Shares purchased (Note 17(g)) (15,517,980) (85.2) — — (64.8) — (150.0)
Net earnings — — — — 1,283.0 370.5 1,653.5
Other comprehensive income — — — 349.1 — 0.2 349.3
Reclassification of pension remeasurements to retained
earnings on disposal of discontinued operations — — — 3.5 (3.5) — —
Total comprehensive income — — — 352.6 1,279.5 370.7 2,002.8
Balance, December 31, 2025 854,347,591 $ 5,316.5 $ 56.3 $ (23.2) $ 1,270.2 $ 1,326.3 $ 7,946.1
Balance, December 31, 2023 773,667,789 $ 4,574.8 $ 55.2 $ (296.6) $ 627.9 $ 1,456.8 $ 6,418.1
Distributions — — — — — (152.0) (152.0)
Caserones acquisition — — — — (52.6) (353.5) (406.1)
Exercise of share-based awards 3,250,382 31.2 (10.2) — — — 21.0
Share-based compensation — — 6.3 — — — 6.3
Dividends declared — — — — (203.0) — (203.0)
Shares purchased (2,815,200) (16.7) — — (7.7) — (24.4)
Accrued liability for automatic share purchase plan
commitment — (3.7) — — — — (3.7)
Net (loss) earnings — — — — (203.5) 142.2 (61.3)
Other comprehensive (loss) income — — — (79.2) — 0.1 (79.1)
Total comprehensive (loss) income — — — (79.2) (203.5) 142.3 (140.4)
Balance, December 31, 2024 774,102,971 $ 4,585.6 $ 51.3 $ (375.8) $ 161.1 $ 1,093.6 $ 5,515.8
The accompanying notes are an integral part of these consolidated financial statements.
- 4 -
===== SIDA 94 =====
LUNDIN MINING CORPORATION
CONSOLIDATED STATEMENTS OF CASH FLOWS
For the years ended December 31, 2025 and 2024
(in millions of US dollars)
Cash provided by (used in) 2025 2024
Operating activities
Net earnings from continuing operations $ 1,417.7 $ 267.6
Items not involving cash and other adjustments
Depreciation, depletion and amortization 618.9 574.2
Share-based compensation 12.4 6.4
Unrealized foreign exchange loss (gain) 5.2 (10.9)
Finance costs, net (Note 23) 90.5 137.7
Recognition of deferred revenue (Note 14) (72.1) (78.1)
Deferred tax recovery (569.7) (36.1)
Goodwill and asset impairment (Note 10) — 149.4
Revaluation of foreign currency and commodity derivatives (Note 26) 8.2 87.2
Long-term inventory write-down (reversal) (Note 7) 88.2 (26.6)
Write-down of assets and loss on disposal (Note 24) 20.9 30.4
Revaluation of Caserones purchase option (Note 24) — (11.7)
Other 3.8 17.3
Reclamation payments (Note 15) (7.9) (9.9)
Changes in long-term inventory 5.8 (7.2)
Changes in non-cash working capital items (Note 32) (414.0) 221.7
Cash provided by operating activities from continuing operations 1,207.9 1,311.4
Cash provided by operating activities from discontinued operations 134.7 207.5
1,342.6 1,518.9
Investing activities
Investment in mineral properties, plant and equipment (684.6) (786.1)
Acquisition of Filo Corp. (Note 4) (610.7) —
Proceeds from partial disposal of subsidiary (Note 4) 689.5 —
Proceeds from disposal of subsidiaries, net of cash disposed (Note 3) 1,314.6 —
Purchase of marketable securities (5.0) (41.7)
Payment of Chapada derivative liability (Note 16) — (25.0)
Interest received 14.6 15.5
Other (11.2) 2.4
Cash provided by (used in) investing activities from continuing operations 707.2 (834.9)
Cash used in investing activities from discontinued operations (76.2) (172.0)
631.0 (1,006.9)
Financing activities
Proceeds from debt (Note 12) 1,714.9 1,500.6
Principal repayments of debt (Note 12) (3,245.2) (944.3)
Principal payments of lease liabilities (Note 13) (54.6) (60.1)
Interest paid (66.9) (118.5)
Payment of Caserones deferred consideration (Note 26) (10.0) (10.0)
Exercise of Caserones purchase option — (350.0)
Dividends paid to shareholders (105.7) (202.5)
Shares purchased (Note 17) (153.7) (24.4)
Proceeds from common shares issued 10.2 21.0
Distributions paid to non-controlling interests (138.0) (152.0)
Net payment from settlement of foreign currency and commodity derivatives (31.8) (0.5)
Other 0.5 (2.2)
Cash used in financing activities from continuing operations (2,080.3) (342.9)
Cash used in financing activities from discontinued operations (8.9) (1.4)
(2,089.2) (344.3)
Effect of foreign exchange on cash balances 1.5 (4.2)
(Decrease) increase in cash and cash equivalents during the year (114.1) 163.5
Cash and cash equivalents, beginning of year 432.3 268.8
Less: Cash and cash equivalents included in assets held for sale, end of year (Note 3) (22.0) (74.8)
Cash and cash equivalents, end of year $ 296.2 $ 357.5
Supplemental cash flow information (Note 32)
The accompanying notes are an integral part of these consolidated financial statements.
- 5 -
===== SIDA 95 =====
1. NATURE OF OPERATIONS
Lundin Mining Corporation ("Lundin Mining" or the "Company") is a diversified Canadian base metals mining company
primarily producing copper and gold. The Company owns 80% of the Candelaria and Ojos del Salado mining complex
(“Candelaria”) and 70% of the Caserones mine, each of which are located in Chile. As at December 31, 2025, the
Company’s wholly-owned operating assets included the Chapada mine located in Brazil and the Eagle mine located in
the United States of America (“USA”). The Company also has a 50% ownership interest in Vicuña Corp., holding the
Josemaria project in Argentina and Filo del Sol project in Argentina and Chile ("Vicuña").
In December 2025, the Company entered into a definitive agreement to sell its 100% interest in Lundin Mining US Ltd.
and its subsidiaries (together "Eagle mine") to Talon Metals Corp. ("Talon"). The transaction was completed on January
9, 2026. As a result, the Company determined that the Eagle reporting segment met the criteria to be classified as held
for sale on December 31, 2025. The assets of Eagle mine have been classified as current assets held for sale and the
liabilities of Eagle mine have been classified as current liabilities associated with assets held for sale, and the operating
results of the Eagle reporting segment have been re-presented and included in the single line item of earnings (loss)
from discontinued operations, net of taxes, on the consolidated statement of earnings (loss) (Note 3).
On April 16, 2025, the Company completed the previously announced transaction to sell its 100% interests in
Somincor-Sociedade Mineira de Neves-Corvo, S.A. ("Neves-Corvo") in Portugal and its 100% interests in each of
Zinkgruvan Mining AB and North Atlantic Natural Resources AB (together "Zinkgruvan") in Sweden. The assets and
liabilities of the Neves-Corvo mine and the Zinkgruvan mine were classified as held for sale on December 31, 2024. The
operating results of these segments for the year ended December 31, 2024 have been re-presented as a single line
item of earnings (loss) from discontinued operations, net of taxes, on the consolidated statement of earnings (loss)
(Note 3).
The Company’s common shares are listed on the Toronto Stock Exchange (“TSX”) in Canada and the Nasdaq Stockholm
Exchange in Sweden. The Company is incorporated under the Canada Business Corporations Act and is domiciled in
Canada. Its principal place of business is 1055 Dunsmuir Street, Suite 2800, Vancouver, British Columbia, Canada.
2. BASIS OF PRESENTATION AND SUMMARY OF MATERIAL ACCOUNTING POLICIES
(i) Basis of presentation and measurement
The consolidated financial statements have been prepared in accordance with International Financial Reporting
Standards as issued by the International Accounting Standards Board ("IFRS Accounting Standards") and which
the Canadian Accounting Standards Board has approved for incorporation into Part 1 of the CPA Canada
Handbook – Accounting.
No new accounting standards or interpretations were adopted January 1, 2025.
The consolidated financial statements have been prepared on a historical cost basis except for certain financial
instruments which have been measured at fair value.
The Company's presentation currency is United States (“US”) dollars. Reference herein of $ or USD is to US
dollars, C$ or CAD is to Canadian dollars, SEK is to Swedish krona, € refers to the Euro, CLP refers to the Chilean
peso, BRL refers to the Brazilian real, and ARS refers to the Argentine peso.
These consolidated financial statements were approved by the Board of Directors of the Company for issue on
February 19, 2026.
LUNDIN MINING CORPORATION
Notes to consolidated financial statements
For the years ended December 31, 2025 and 2024
(Tabular amounts in millions of US dollars, except for shares and per share amounts)
- 6 -
===== SIDA 96 =====
(ii) Material accounting policies
The Company has consistently applied the accounting policies to all the years presented. The material accounting
policies applied in these consolidated financial statements are set out below.
(a) Basis of consolidation
The financial statements consist of the consolidation of the financial statements of the Company and its
subsidiaries.
Subsidiaries are entities over which the Company has control, including the power to govern the financial
and operating policies in order to obtain benefits from their activities. The existence and effect of potential
voting rights that are currently exercisable or convertible are considered when assessing whether the
Company controls another entity. Subsidiaries are fully consolidated from the date on which control is
obtained by the Company and are de-consolidated from the date that control ceases.
Where necessary, adjustments are made to the results of the subsidiaries and associates to bring their
accounting policies in line with those used by the Company. Intra-group transactions, balances, income and
expenses are eliminated on consolidation.
For non wholly-owned subsidiaries, the net assets attributable to outside equity shareholders are presented
as non-controlling interests in the equity section of the consolidated balance sheet. Net earnings for the
period that are attributable to non-controlling interests are calculated based on the ownership of the
minority shareholders in the subsidiary.
(b) Interests in joint arrangements
A joint arrangement can take the form of a joint venture or a joint operation. All joint arrangements involve
a contractual arrangement that establishes joint control which exists when decisions about the activities
that significantly affect the returns of the investee require unanimous consent of the parties sharing control.
A joint venture is a joint arrangement in which the Company has rights to only the net assets of the
arrangement. A joint operation is a joint arrangement in which the Company has the rights to the assets and
obligations for the liabilities relating to the arrangement. Joint operations are accounted for by recognizing
the Company's share of the assets, liabilities, revenue, expenses and cash flows of the joint operation in the
consolidated financial statements.
(c) Translation of foreign currencies
The functional currency of each entity within the Company is the currency of the primary economic
environment in which it operates. The Company’s presentation currency is US dollars.
Transactions denominated in currencies other than the functional currency are recorded using the exchange
rates prevailing on the dates of the transactions. At each balance sheet date, monetary items denominated
in foreign currencies are translated at the rates prevailing on the balance sheet date. Non-monetary items
that are measured at historical cost in a foreign currency are translated using the exchange rate at the date
of the transaction. Non-monetary items measured at fair value in a foreign currency are translated at the
rates prevailing on the date when the fair value was determined. Foreign currency translation differences on
deferred foreign tax liabilities and assets are reported in deferred tax expense/recovery in the consolidated
statement of earnings (loss).
Exchange differences arising on the settlement of monetary items, and on the translation of monetary
items, are recognized in the consolidated statement of earnings (loss) in the period in which they arise.
Exchange differences arising on the translation of non-monetary items carried at fair value are included in
the consolidated statement of earnings (loss).
LUNDIN MINING CORPORATION
Notes to consolidated financial statements
For the years ended December 31, 2025 and 2024
(Tabular amounts in millions of US dollars, except for shares and per share amounts)
- 7 -
===== SIDA 97 =====
For the purpose of presenting the consolidated financial statements, the assets and liabilities of the
Company’s foreign operations are translated into US dollars, which is the presentation currency of the
group, at the rate of exchange prevailing at the end of the reporting period. Income and expenses are
translated at the average exchange rates for the period where these approximate the rates on the dates of
transactions.
On disposal of a foreign operation, the historical, cumulative amount of exchange differences recognized as
a separate component of equity is reclassified and recognized in the consolidated statement of earnings
(loss).
(d) Cash and cash equivalents
Cash and cash equivalents comprise cash on deposit with banks and highly liquid short-term interest-
bearing investments with a term to maturity at the date of purchase of 90 days or less which are subject to
an insignificant risk of change in value.
(e) Restricted funds
Restricted funds include reclamation funds and cash on deposit that have been pledged for reclamation and
closure activities which are not available for immediate disbursement.
(f) Inventories
Ore and concentrate stockpiles and cathode inventory are valued at the lower of production cost and net
realizable value (“NRV”). Production costs include costs of materials and labour related directly to mining
and processing activities, including production phase stripping costs, depreciation and amortization of
mineral property, plant and equipment directly involved in the related mining and production process,
amortization of any stripping costs previously capitalized and directly attributable overhead costs.
Dump leach pad inventory represents ore that has been mined and placed on leach pads where a solution is
applied to the surface of the heap to dissolve the copper and by-products. The resulting solution is further
processed in a plant to recover the copper. The cost of dump leach inventory is derived from current mining
and leaching costs and is removed at the weighted average cost per recoverable pound ("lb") of copper on
the leach pads as lbs of copper are recovered. Estimates of recoverable copper on the dump leach are
calculated based on the quantities of ore placed on the leach pads (measured in tonnes added to the leach
pads), the grade of ore placed on the leach pads (based on assay data), and an estimated recovery
percentage (based on estimated recovery assumptions from the block model). The nature of the leaching
process inherently limits the ability to precisely monitor inventory levels. As a result, estimates are refined
based on actual results and engineering studies over time. The final recovery of copper from the dump leach
will not be known until the leaching process is concluded at the end of the mine life. Ore on the dump leach
that is not expected to be recovered within the next twelve months is classified as non-current.
Materials and supplies inventories are valued at the lower of average cost less allowances for obsolescence
and NRV.
If the carrying value of inventories exceeds NRV, a write-down is recognized. The write-down may be
reversed in a subsequent period if the circumstances which caused the write-down no longer exist.
LUNDIN MINING CORPORATION
Notes to consolidated financial statements
For the years ended December 31, 2025 and 2024
(Tabular amounts in millions of US dollars, except for shares and per share amounts)
- 8 -
===== SIDA 98 =====
(g) Mineral properties
Mineral properties are carried at cost, less accumulated depletion and any accumulated impairment
charges. Expenditures on mineral properties include:
i. Acquisition costs which consist of payments for property rights and leases, including the
estimated fair value of exploration properties acquired as part of a business combination or the
acquisition of a group of assets.
ii. Exploration, evaluation and project investigation costs incurred on an area of interest once a
determination has been made that a property has economically recoverable Mineral Resources
and Mineral Reserves (“R&R”) and there is a reasonable expectation that costs can be
recovered by future exploitation or sale of the property. Exploration, evaluation and project
investigation expenditures made prior to a determination that a property has economically
recoverable R&R are expensed as incurred.
iii. Deferred stripping costs which represent the costs incurred to remove overburden and other
waste materials to access ore in an open pit mine. Stripping costs incurred prior to the
production phase of the mine are capitalized and included as part of the carrying value of the
mineral property. During the production phase, stripping costs which provide probable future
economic benefits, identifiable improved access to the ore body and which can be measured
reliably are capitalized to mineral properties. Capitalized stripping costs are amortized using a
unit-of-production basis over the Proven and Probable Mineral Reserve to which they relate.
iv. Development costs incurred in an area of interest, once management has determined the
technical feasibility and commercial viability of a project, the project presents an appropriate
rate of return on investment, and the Board of Directors has demonstrated commitment to
advance the project. When additional development expenditures are made on a property after
commencement of production, the expenditure is capitalized as mineral property when it is
probable that additional economic benefit will be derived from future operations. Development
costs are amortized using a unit-of-production basis over the Proven and Probable Mineral
Reserve to which they relate.
v. Interest and financing costs on debt or other liabilities that are directly attributed to the
acquisition, construction and development of a qualifying asset. All other borrowing costs are
expensed as incurred.
(h) Plant and equipment
Plant and equipment are carried at cost, less accumulated depreciation and any accumulated impairment
charges. For production plant and equipment, depreciation is recorded on a units-of-production basis.
Depreciation on all other plant and equipment is recorded on a straight-line basis over the estimated useful
life of the asset or over the estimated remaining life of the mine, if shorter. Residual values and useful lives
are reviewed annually. Gains and losses on disposals are calculated as proceeds received less the carrying
amount and are recognized in the consolidated statement of earnings (loss).
Useful lives are as follows:
Number of years
Buildings 8-20
Plant and machinery 3-20
Equipment 3-8
LUNDIN MINING CORPORATION
Notes to consolidated financial statements
For the years ended December 31, 2025 and 2024
(Tabular amounts in millions of US dollars, except for shares and per share amounts)
- 9 -
===== SIDA 99 =====
(i) Intangible assets
Separately acquired intangible assets are initially measured at cost which is comprised of its purchase price
and any directly attributable costs of preparing the asset for its intended use. The Company depreciates
intangible assets with finite useful lives on a straight-line basis over the estimated useful life of the asset.
For intangibles with an indefinite useful life, no amortization is calculated.
(j) Impairment and impairment reversals
At the end of each reporting period, the Company assesses whether there is an indication that an asset or
group of assets within a cash generating unit (“CGU”) may be impaired. When impairment indicators exist,
the Company estimates the recoverable amount of the asset or CGU and compares it against the asset or
CGU’s carrying amount. The recoverable amount is the higher of the fair value less cost of disposal
(“FVLCD”) and the asset or CGU’s value in use (“VIU”). If the carrying value exceeds the recoverable amount,
an impairment loss is recorded in the consolidated statement of earnings (loss) during the period. If either
FVLCD or VIU exceeds the asset or CGU’s carrying amount, the asset or CGU is not impaired, and the
Company does not estimate the other amount.
In assessing VIU, the estimated future cash flows are discounted to their present value using a pre-tax
discount rate that reflects current market assessments of the time value of money and the risks specific to
the CGU for which the estimates of future cash flows have not been adjusted. The cash flows are based on
best estimates of expected future cash flows from the continued use of the asset or the CGU and its
eventual disposal.
FVLCD is the price that would be received to sell an asset or paid to transfer a liability in an orderly
transaction between market participants, which is best evidenced if obtained from an active market or
binding sale agreement. Where neither exists, the fair value is based partly on a discounted cash flow
projections model. Costs of disposal, other than those that have been recognized as liabilities, are deducted
in measuring FVLCD.
Reversals of impairment are assessed at each reporting period where there is an indication that an
impairment loss recognized previously may no longer exist or has decreased. If an impairment reversal
indicator exists, the recoverable amount is calculated. If the recoverable amount exceeds the carrying
amount, the carrying value of the CGU is increased to the recoverable amount net of depreciation. The
increased carrying amount cannot exceed the carrying amount that would have been determined had no
impairment loss been recognized for the CGU in prior years. A reversal of an impairment loss is recognized
as a gain in the consolidated statement of earnings (loss) in the period it is determined.
(k) Business combinations and goodwill
Acquisitions of businesses are accounted for using the purchase method of accounting whereby all
identifiable assets and liabilities are recorded at their fair values as at the date of acquisition. Any excess
purchase price over the aggregate fair value of net assets is recorded as goodwill. Goodwill is identified and
allocated to CGUs, or groups of CGUs, that are expected to benefit from the synergies of the acquisition.
Goodwill is not amortized. Any excess of the aggregate fair value of net assets over the purchase price is
recognized in the consolidated statement of earnings (loss).
A CGU to which goodwill has been allocated is tested for impairment at least annually or when events or
changes in circumstances indicate that the related carrying amount may not be recoverable. For goodwill
arising on an acquisition in a financial year, the CGU to which the goodwill has been allocated is tested for
impairment before the end of that financial year.
LUNDIN MINING CORPORATION
Notes to consolidated financial statements
For the years ended December 31, 2025 and 2024
(Tabular amounts in millions of US dollars, except for shares and per share amounts)
- 10 -
===== SIDA 100 =====
When the recoverable amount of the CGU is less than the carrying amount of that CGU, the impairment loss
is allocated to reduce the carrying amount of any goodwill allocated to that CGU first, and then to the other
assets of that CGU on a pro-rata basis of the carrying amount of each asset in the CGU. Any impairment loss
for goodwill is recognized directly in the consolidated statement of earnings (loss). An impairment loss for
goodwill is not reversed in subsequent periods.
On disposal of a subsidiary, the attributable amount of goodwill is included in the determination of the gain
or loss on disposal.
(l) Leases
At inception of a contract, the Company assesses whether the contract is, or contains a lease. A contract is,
or contains a lease, if the contract conveys the right to control the use of an identified asset for a period of
time in exchange for consideration.
The Company has elected not to recognize right-of-use assets and lease liabilities for short-term leases that
have a lease term of 12 months or less, and leases of low-value assets. For these leases, the Company
recognizes the lease payments as an expense in the consolidated statement of earnings (loss) on a straight-
line basis over the term of the lease.
The Company recognizes a lease liability and a right-of-use asset at the lease commencement date.
The lease liability is initially measured as the present value of future lease payments discounted using the
interest rate implicit in the lease or, if that rate cannot be readily determined, each operation’s applicable
incremental borrowing rate. The incremental borrowing rate is the rate which the operation would have to
pay to borrow, over a similar term and with a similar security, the funds necessary to obtain an asset of
similar value to the right-of-use asset in a similar economic environment.
Lease payments included in the measurement of the lease liability comprise the following:
- fixed payments, including in-substance fixed payments, less any lease incentives receivable;
- variable lease payments that depend on an index or a rate, initially measured using the index or
rate as at the commencement date;
- amounts expected to be payable by the Company under residual value guarantees;
- the exercise price of a purchase option if the Company is reasonably certain to exercise that option;
and
- payments of penalties for terminating the lease, if the Company expects to exercise an option to
terminate the lease.
The lease liability is subsequently measured by:
- increasing the carrying amount to reflect interest on the lease liability;
- reducing the carrying amount to reflect lease payments made; and
- remeasuring the carrying amount to reflect any reassessment or lease modifications.
Variable lease payments that do not depend on an index or rate are not included in the measurement of the
lease liability.
The lease liability is remeasured when there is a change in future lease payments arising from a change in an
index or rate, if there is a change in the Company’s estimate of the amount expected to be payable under a
residual value guarantee, or if the Company changes its assessment of whether it will exercise a purchase,
extension or termination option.
Each lease payment is allocated between the lease liability and finance cost. The finance cost is recorded as
an expense in the consolidated statement of earnings (loss) over the lease period to produce a constant
periodic rate of interest on the remaining balance of the liability for each period.
LUNDIN MINING CORPORATION
Notes to consolidated financial statements
For the years ended December 31, 2025 and 2024
(Tabular amounts in millions of US dollars, except for shares and per share amounts)
- 11 -
===== SIDA 101 =====
The right-of-use asset is initially measured at cost, which comprises the following:
- the amount of the initial measurement of the lease liability;
- any lease payments made at or before the commencement date, less any lease incentives received;
- any initial direct costs incurred by the Company; and
- an estimate of costs to be incurred by the Company in dismantling and removing the underlying
asset, restoring the site on which it is located or restoring the underlying asset to the condition
required by the terms and conditions of the lease, unless those costs are incurred to produce
inventories.
The right-of-use asset is subsequently measured at cost, less any accumulated depreciation and any
accumulated impairment losses, and adjusted for any remeasurement of the lease liability. It is depreciated
in accordance with the Company’s accounting policy for plant and equipment, from the commencement
date to the earlier of the end of its useful life or the end of the lease term.
On the consolidated balance sheet, right-of-use assets and lease liabilities are reported in mineral
properties, plant and equipment and lease liabilities, respectively.
(m) Non-current assets held for sale and discontinued operations
Assets and businesses are classified as held for sale if their carrying amount will be recovered or settled
principally through a sale transaction rather than through continuing use. The asset or business must be
available for immediate sale and the sale must be highly probable within one year.
Assets and businesses classified as held for sale are measured at the lower of carrying amount and fair value
less costs to sell ("FVLCS"). Immediately prior to reclassification to assets held for sale, the Company is
required to assess for impairment of assets of CGU's under its normal impairment policies. If the carrying
value related to a specific asset or business classified as held for sale exceeds its FVLCS an impairment loss is
recognized in the consolidated statement of (loss) earnings. No depreciation is charged on assets and
businesses classified as held for sale. Assets and liabilities classified as held for sale are presented separately
as current items in the consolidated balance sheet.
A discontinued operation is a component of the Company’s business that represents a separate major line
of business or geographical area of operations that has been disposed of, has been abandoned, or meets
the criteria to be classified as held for sale. Discontinued operations are excluded from the results of
continuing operations and are presented as a single amount as profit or loss after tax from discontinued
operations in the consolidated statement of earnings (loss).
(n) Reclamation and other closure provisions
The Company incurs reclamation and other closure costs related to its mining properties such as facility
decommissioning and dismantling, end of mine life severance, site restoration and ongoing environmental
monitoring. These costs are a normal consequence of mining and are dependent on the requirements of the
Company’s legal and constructive obligations, as well as any other commitments made to stakeholders. The
majority of these expenditures will be incurred at the end of the life of mine and are dependent upon a
number of factors such as the life and nature of the asset, the operating license conditions and the
environment in which the mine operates.
The future obligations for mine closure activities are estimated by the Company using mine closure plans or
other similar studies which outline the activities to be undertaken to meet regulatory and internal
requirements. Since the obligations are dependent on the laws and regulations of the countries in which the
mines operate, they are regularly evaluated by management and external experts. Costs included in the
obligations encompass all reclamation and other closure activities expected to occur progressively over the
life of the operation, at the time of closure and post-closure in connection with disturbances as at the
reporting date.
LUNDIN MINING CORPORATION
Notes to consolidated financial statements
For the years ended December 31, 2025 and 2024
(Tabular amounts in millions of US dollars, except for shares and per share amounts)
- 12 -
===== SIDA 102 =====
Obligations may change as a result of amendments in laws and regulations relating to environmental
protection and/or other legislation affecting resource companies. Included in the estimated obligations are
a number of significant assumptions made by management in determining closure provisions. Accordingly,
closure provisions are more uncertain the further into the future mine closure activities are expected to be
carried out.
The Company records the present value of its reclamation and other closure provisions as a liability with a
corresponding increase in the carrying value of the related asset. The provision is discounted to its net
present value using a country specific, current market, pre-tax discount rate. The unwinding of the discount,
referred to as an accretion expense, is included in finance costs in the consolidated statement of earnings
(loss) and results in an increase in the carrying amount of the liability. Reclamation obligations settled in the
year are offset against the corresponding liability. Unplanned reclamation costs are reported as either part
of the cost of inventory or recognized as a cost in the consolidated statement of earnings (loss), if they
relate to either production activities or a closed site.
The capitalized cost of the reclamation and other closure activities is recognized in the mineral property and
plant & equipment and depreciated on a unit-of-production basis over the expected mine life of the
operation or asset to which it relates. Depreciation costs are included in the consolidated statement of
earnings (loss) as part of cost of goods sold.
Changes in obligations resulting from revisions to the timing or amount of expenditures, discount rate or
foreign exchange rate are recognized as an increase or decrease in the reclamation and other closure
provision liability, and a corresponding change in the carrying amount of the related assets.
(o) Revenue recognition
Revenue from contracts with customers is recognized when a customer obtains control of the promised
asset and the Company satisfies its performance obligation. Revenue is allocated to each performance
obligation. The Company considers the terms of the contract in determining the transaction price. The
transaction price is based upon the amount the entity expects to be entitled to in exchange for the
transferring of promised goods. The Company earns revenue from contracts with customers related to its
concentrate and copper cathode sales, and its copper, gold and silver streaming arrangements.
The Company satisfies its performance obligations for its concentrate and copper cathode sales per
specified contract terms which are generally upon shipment or delivery of an individual parcel. Revenue
from concentrate and copper cathode sales is recorded based upon forward market prices of the expected
final sales price date. The Company typically recognizes revenue when concentrate or copper cathodes have
been placed on board a vessel for shipment or delivered to a location specified by the customer.
Deferred revenue arises from up-front payments received by the Company or obligations acquired in
consideration for future commitments as specified in its various streaming arrangements. The accounting
for streaming arrangements is dependent on the facts and terms of each of the arrangements. Revenue
from streaming arrangements is recognized when the customer obtains control of the copper, gold and/or
silver metal and the Company has satisfied its performance obligations.
The Company identified significant financing components related to its streaming arrangements resulting
from a difference in the timing of the up-front consideration received and delivery of the promised goods.
Interest expense on deferred revenue is recognized in finance costs, or in mineral properties, plant and
equipment if directly attributable to the acquisition, construction and development of a qualifying asset.
The interest rate is determined based on the rate implicit in each streaming agreement at the date of
inception or acquisition.
The initial consideration received from the streaming arrangements is considered variable, subject to
changes in the total copper, gold and silver volumes to be delivered. Changes to variable consideration are
reflected in revenue in the consolidated statement of earnings (loss).
LUNDIN MINING CORPORATION
Notes to consolidated financial statements
For the years ended December 31, 2025 and 2024
(Tabular amounts in millions of US dollars, except for shares and per share amounts)
- 13 -
===== SIDA 103 =====
(p) Share-based compensation
The Company grants share-based awards in the form of share options and share units to certain employees
in exchange for the provision of services. The share options and share units are equity-settled awards. The
Company determines the fair value of the awards on the date of grant. This fair value is charged to the
consolidated statement of earnings (loss) using a graded vesting attribution method over the vesting period
of the awards, with a corresponding credit to contributed surplus. When the share options or share units
are exercised, the applicable amounts of contributed surplus are transferred to share capital. At the end of
the reporting period, the Company updates its estimate of the number of awards that are expected to vest
and adjusts the total expense to be recognized over the vesting period. The Company also grants share-
based awards to non-employee Directors in the form of deferred share units (“DSUs”) in exchange for the
provision of services. DSUs are liability awards settled in cash and measured at the quoted market price at
the grant date. The corresponding liability is adjusted for changes in fair value at each subsequent reporting
date until the awards are settled. The fair value of the DSUs are expensed at the grant date and subsequent
changes to fair value are charged to the consolidated statement of earnings (loss).
(q) Current and deferred income taxes
Income tax expense represents the sum of current and deferred tax. Current taxes payable is based on
taxable earnings for the year. Taxable earnings may differ from earnings before income tax as reported in
the consolidated statement of earnings (loss) because it may exclude items of income or expense that are
taxable or deductible in other years and it may further exclude items of income or expense that are never
taxable or deductible. The Company’s liability for current tax is calculated using tax rates that have been
enacted or substantively enacted at the balance sheet date.
Income tax assets and liabilities are offset when there is a legally enforceable right to offset the assets and
liabilities and when they relate to income taxes levied by the same tax authority on either the same taxable
entity or different taxable entities where there is an intention to settle the balance on a net basis.
Deferred tax is recognized on differences between the carrying amounts of assets and liabilities in the
financial statements and the corresponding tax bases used in the computation of taxable earnings. Deferred
tax liabilities are generally recognized for all taxable temporary differences and deferred tax assets are
recognized to the extent that it is probable that future taxable income will be available against which
deductible temporary differences or tax loss carryforwards can be utilized. Such assets and liabilities are not
recognized if the temporary difference arises from goodwill or from the initial recognition (other than in a
business combination) of other assets and liabilities in a transaction that affects neither the taxable earnings
nor the accounting earnings. Deferred tax liabilities are recognized for taxable temporary differences arising
on investments in subsidiaries and investments in associates, except where the Company is able to control
the reversal of the temporary differences and it is probable that the temporary differences will not reverse
in the foreseeable future. The carrying amount of deferred tax assets is reviewed at each balance sheet date
and reduced to the extent that it is no longer probable that sufficient taxable earnings will be available to
allow all or part of the asset to be recovered.
Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is
settled or the asset realized, based on tax rates and tax laws that have been enacted or substantively
enacted by the balance sheet date. Deferred tax is charged or credited to earnings, except when it relates to
items charged or credited directly to equity, in which case the deferred tax is reflected in equity.
(r) Earnings per share
Basic earnings per share is calculated using the weighted average number of common shares outstanding
during each reporting period. Diluted earnings per share is calculated assuming the proceeds from the
exercise of “in-the-money” share-based arrangements are used to purchase common shares at the average
market price during the period.
LUNDIN MINING CORPORATION
Notes to consolidated financial statements
For the years ended December 31, 2025 and 2024
(Tabular amounts in millions of US dollars, except for shares and per share amounts)
- 14 -
===== SIDA 104 =====
(s) Financial instruments
Financial instruments are recognized on the consolidated balance sheet on the trade date, the date on
which the Company becomes a party to the contractual provisions of the financial instrument. The Company
classifies its financial instruments in the following categories:
Financial Assets at Amortized Cost
Assets that are held for collection of contractual cash flows where those cash flows represent solely
payments of principal and interest are measured at amortized cost. The Company intends to hold these
receivables until cash flows are collected. Receivables are recognized initially at fair value, net of any
transaction costs incurred and subsequently measured at amortized cost using the effective interest
method. The Company recognizes a loss allowance for expected credit losses on a financial asset that is
measured at amortized cost.
Financial Assets at Fair Value through Profit or Loss (“FVTPL”)
Financial assets measured at FVTPL are assets which do not qualify as financial assets at amortized cost or
those not designated in hedge relationships.
Provisionally priced trade receivables are measured at FVTPL as some or all of the cash flows are dependent
on commodity prices. These receivables are initially measured at their transaction price. Subsequent
changes to provisionally priced trade receivables are recorded in the consolidated statement of earnings
(loss) as revenue from other sources.
Marketable securities, equity investments, and derivative assets not designated in hedge relationships are
classified as FVTPL. These financial assets are initially recognized at their fair value with changes to fair
values recognized in the consolidated statement of earnings (loss).
Financial Liabilities at Amortized Cost
Financial liabilities are measured at amortized cost using the effective interest method, unless they are
required to be measured at FVTPL, or the Company has opted to measure them at FVTPL. Long-term debt is
recognized initially at fair value, net of any transaction costs incurred, and subsequently at amortized cost
using the effective interest method.
Financial Liabilities at FVTPL
Financial liabilities at FVTPL are liabilities that cannot be classified as amortized cost which include
embedded derivatives and derivative liabilities not designated in hedge relationships. Financial liabilities at
FVTPL are initially recognized at fair value with changes to fair values recognized in the consolidated
statement of earnings (loss).
The Company derecognizes financial assets only when the contractual rights to cash flows from the financial
assets expire, or when it transfers the financial assets and substantially all of the associated risks and
rewards of ownership. Gains and losses on derecognition are generally recognized in the consolidated
statement of earnings (loss).
The Company derecognizes financial liabilities only when its obligations under the financial liabilities are
discharged, cancelled or expelled. The difference between the carrying amount of the financial liability
derecognized and the consideration paid and payable, including any non-cash assets transferred or liabilities
assumed, is recognized in the consolidated statement of earnings (loss).
LUNDIN MINING CORPORATION
Notes to consolidated financial statements
For the years ended December 31, 2025 and 2024
(Tabular amounts in millions of US dollars, except for shares and per share amounts)
- 15 -
===== SIDA 105 =====
The Company may enter into derivative instruments to mitigate exposures to commodity price and currency
exchange rate fluctuations, among other exposures. Unless the derivative instruments qualify for hedge
accounting, and management undertakes appropriate steps to designate them as such, they are classified as
financial assets or liabilities at FVTPL and recorded at their fair value with realized and unrealized gains or
losses arising from changes in the fair value recorded in the consolidated statement of earnings (loss) in the
period they occur. Fair values for derivative instruments are determined using valuation techniques. The
valuations use assumptions based on prevailing market conditions on the reporting date.
(iii) New standards and interpretations not yet adopted
IFRS 18 - Presentation and Disclosure in Financial Statements
In April 2024, the International Accounting Standards Board ("IASB") issued IFRS 18 - Presentation and Disclosure
in Financial Statements, which replaces IAS 1 - Presentation of Financial Statements. IFRS 18 introduces a
specified structure for the income statement by requiring income and expenses to be presented into three
defined categories (operating, investing, and financing) and by specifying certain defined totals and subtotals.
Where company-specific measures related to the income statement are provided ("management-defined
performance measures"), IFRS 18 requires disclosure of the explanations around those measures. IFRS 18 also
provides additional guidance on principles of aggregation and disaggregation which apply to the primary financial
statements and notes. IFRS 18 will not impact the recognition and measurement of items in the financial
statements, nor will it impact which items are classified in other comprehensive income and how these items are
classified. The standard is effective for reporting periods beginning on or after January 1, 2027, including for
interim financial statements. Retrospective application is required and early application is permitted.
The Company has completed a preliminary evaluation of the impact of IFRS 18 on the presentation of the
statements of financial position, earnings (loss) and cash flows. The Company has commenced system and
process changes to allow tracking of certain items for presentation in accordance with IFRS 18 in comparative
period financial statements. The Company continues to assess other matters related to the implementation of
this new standard on its financial statements.
IFRS 9 - Financial Instruments and IFRS 7 – Financial Instruments: Disclosures
In May 2024, the IASB issued amendments to the classification and measurement of financial instruments. These
amendments updated classification and measurement requirements in IFRS 9 Financial Instruments and related
disclosure requirements in IFRS 7 Financial Instruments: disclosures. The IASB clarified the recognition and
derecognition date of certain financial assets and liabilities, and amended the requirements related to settling
financial liabilities using an electronic payment system. Moreover, the amendments clarify the assessment of the
contractual cash flow characteristics of financial assets in determining whether they meet the solely payments of
principal and interest (SPPI) criterion, including financial assets that have environmental, social and corporate
governance (ESG)-linked features and other similar contingent features. The IASB added disclosure requirements
for financial instruments with contingent features that do not relate directly to basic lending risks and costs, and
amended disclosures relating to equity instruments designated at fair value through other comprehensive
income.
Additionally in December 2024, the IASB published amendments to IFRS 9 and IFRS 7 - Contracts Referencing
Nature dependent Electricity. The amendments clarify the application of the ‘own-use’ requirements for in-scope
contracts, amend the designation requirements for a hedged item in a cash flow hedging relationship for in-scope
contracts, and add new disclosure requirements.
These amendments apply retrospectively for annual reporting periods beginning on or after 1 January 2026, with
early application permitted.
The Company does not expect the adoption of the amendments to have a material impact on the Company’s
consolidated financial statements or require a restatement of the comparative period.
LUNDIN MINING CORPORATION
Notes to consolidated financial statements
For the years ended December 31, 2025 and 2024
(Tabular amounts in millions of US dollars, except for shares and per share amounts)
- 16 -
===== SIDA 106 =====
(iv) Estimation uncertainty and judgements in applying the entity’s accounting policies
The preparation of consolidated financial statements in accordance with IFRS Accounting Standards requires the
use of certain critical accounting estimates and judgements. These estimates and judgements are based on
management’s best knowledge of the relevant facts and circumstances taking into account previous experience,
but actual results may differ materially from the amounts included in the financial statements.
Areas of estimation uncertainty that have a significant risk of resulting in a material adjustment to the carrying
amounts of assets and liabilities within the next financial year include:
Depreciation, depletion and amortization of mineral properties, plant and equipment - Mineral properties,
plant and equipment comprise a large component of the Company’s assets and as such, the depreciation,
depletion and amortization of these assets have a significant effect on the Company’s financial statements. Upon
commencement of commercial production, the Company depletes mineral property over the life of the mine
based on the depletion of the mine’s Proven and Probable Mineral Reserves. In the case of mining equipment or
other assets, if the useful life of the asset is shorter than the life of the mine, the asset is amortized over its
expected useful life.
Proven and Probable Mineral Reserves are determined based on a professional evaluation using accepted
international standards for the estimation of Mineral Reserves. The assessment involves geological and
geophysical studies, economic data and the reliance on a number of assumptions. The estimates of the Mineral
Reserves may change based on additional knowledge gained subsequent to the initial assessment. This may
include additional data available from continuing exploration, results from the reconciliation of actual mining
production data against the original Mineral Reserve estimates, or the impact of economic factors such as
changes in the price of commodities or the cost of components of production. A change in the original estimate
of Mineral Reserves would result in a change in the rate of depreciation, depletion and amortization of the
related mineral assets.
Valuation of long-term inventory - The Company carries its long-term inventory at the lower of production cost
and NRV. If the carrying value exceeds the net realizable amount, a write-down is required. The write-down may
be reversed in a subsequent period if the circumstances which caused it no longer exist.
The Company reviews NRV at least annually. In particular, for the NRV of long-term inventory, the Company
makes significant estimates in its use of a discounted NRV model related to future production plans, forecasted
commodity prices, foreign exchange rates, inventory quantities, future capital and production costs to complete,
estimates of recoverable copper in leach pads, and the discount rate. These estimates are subject to various risks
and uncertainties and may have an effect on the NRV estimate and the carrying value of the long-term inventory.
Valuation of mineral properties - The Company carries its mineral properties at cost, less accumulated depletion
and any accumulated provision for impairment. The Company undertakes a review of the carrying values of
mineral properties and related expenditures whenever events or changes in circumstances indicate that their
carrying values may exceed their estimated net recoverable amounts determined by reference to estimated
future operating results and discounted net cash flows. An impairment loss is recognized when the carrying value
of those assets is not recoverable. Where a previous impairment has been recorded, the Company analyzes any
reverse impairment indicators. Impairment reversals are recognized in subsequent periods when there has been
a change in the estimates used to determine the asset’s recoverable amount since the last impairment loss was
recognized. In undertaking this review, management of the Company is required to make significant estimates of,
amongst other things, future production and sale volumes, metal prices, foreign exchange rates, R&R quantities,
future capital and production costs and reclamation costs to the end of the mine’s life. These estimates are
subject to various risks and uncertainties which may ultimately have an effect on the expected recoverability of
the carrying values of the mineral properties and related expenditures.
LUNDIN MINING CORPORATION
Notes to consolidated financial statements
For the years ended December 31, 2025 and 2024
(Tabular amounts in millions of US dollars, except for shares and per share amounts)
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Goodwill - The amount by which the purchase price of a business acquisition exceeds the fair value of identifiable
assets and liabilities acquired is recorded as goodwill. Estimates of recoverable value may be impacted by
changes in future metal prices, foreign exchange rates, production based on estimated quantities of R&R,
production and capital expenditures, pricing of in-situ mineral resources implied by the market value of selected
comparable transactions involving the sale of similar companies and mineral properties, and discount rates.
Changes in estimates could have a material impact on the carrying value of the goodwill. Management's
estimates of production based on quantities of R&R are based on information compiled by qualified persons
(management's experts).
Reclamation and other closure provisions - The Company incurs reclamation and other closure costs related to
its mining properties. The future obligations for mine closure activities are estimated by the Company using mine
closure plans or other similar studies which outline the activities to be undertaken to meet regulatory and
internal requirements. Since the obligations are dependent on the laws and regulations of the countries in which
the mines operate, they are regularly reviewed by management and external experts, and could change as a
result of amendments to the laws and regulations. Included in the estimated obligations are a number of
significant assumptions made by management, including nominal discount rates, inflation rates and foreign
exchange rates. Accordingly, closure provisions are more uncertain the further into the future the mine closure
activities are to be carried out.
Valuation of deferred tax assets - The valuation of deferred tax assets is sensitive to significant assumptions used
in forecasting future taxable income including future metal prices, production based on estimated quantities of
R&R, foreign exchange rates, and production costs. These estimates are subject to various risks and uncertainties
which may ultimately have an effect on the future taxable income which support the valuation of deferred tax
assets. Management’s estimates of production based on estimated quantities of R&R are based on information
compiled by qualified persons (management’s experts).
Significant judgements in applying accounting policies
The following are the judgements, apart from those involving estimations, that management has made in
applying the Company’s accounting policies and that have the most significant effect on the amounts recognized
in the consolidated financial statements.
Deferred tax assets - The determination of the ability of the Company to utilize tax loss carry-forwards and
deductible temporary differences to recognize deferred tax assets requires management to exercise judgment
and make certain assumptions about the future performance of the Company. Management is required to assess
whether it is “probable” that the Company will benefit from these prior losses and other deductible temporary
differences.
Caserones has approximately $3.9 billion in net operating losses arising prior to the acquisition by the Company
which can be applied to future taxable income over the mine life to reduce taxes payable in future years. In
determining the amount of the net operating losses and deductible temporary differences which are probable to
be utilized, management has evaluated forecast taxable income and assessed the probability of achieving the
taxable income projections over different planning horizons. Management has also considered the level of
uncertainty associated with future events outside of the Company’s control, including future commodity prices,
foreign exchange rates, labour disruptions, political and regulatory stability, climate-related events, and
geotechnical conditions. As estimation uncertainty increases with the length of the forecast period, progressively
less reliance is placed on longer-dated forecasts when assessing the recoverability of deferred tax assets and
therefore management has used significant judgment in assessing the probability of achieving various levels of
future taxable income.
Assessment of impairment and reverse impairment indicators - Management applies significant judgement in
assessing whether indicators of impairment or reversal of impairment exist for a CGU which would necessitate
impairment testing. Internal and external factors used by management to determine whether indicators exist
include, but are not limited to, significant changes in the use of the asset, commodity prices, foreign exchange
rates, the Company's market capitalization, capital and production forecasts, R&R quantities, and discount rates.
LUNDIN MINING CORPORATION
Notes to consolidated financial statements
For the years ended December 31, 2025 and 2024
(Tabular amounts in millions of US dollars, except for shares and per share amounts)
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