Perseus Mining reported steady gold production in Q2 FY26 with 88,888 ounces at a higher cost, maintaining a robust cash and bullion balance of US$755 million. The company’s development projects remain on track despite increased royalties and a rejected acquisition bid.
- Q2 FY26 gold production steady at 88,888 ounces with AISC rising to US$1,800/oz
- Notional operating cashflow of US$145 million generated despite cost pressures
- Cash and bullion holdings strong at US$755 million, debt facility upsized to US$400 million
- Nyanzaga and CMA Underground projects progressing on schedule
- Acquisition proposal for Predictive Discovery rejected by its board
Operational Performance Amid Rising Costs
Perseus Mining’s December 2025 quarter report reveals a steady operational output with 88,888 ounces of gold produced across its three mines in Côte d’Ivoire and Ghana. However, the All-In Site Cost (AISC) climbed to US$1,800 per ounce, up from US$1,516 in the previous quarter. This increase largely reflects higher royalties, including an additional 2% royalty paid to the Côte d’Ivoire government amid ongoing negotiations, and timing-related capital expenditures.
Despite these cost pressures, Perseus maintained a solid average cash margin of US$1,637 per ounce, translating to a notional operating cashflow of US$145 million. This robust cash generation underscores the company’s operational resilience in a challenging cost environment.
Strong Financial Position and Capital Management
Perseus ended the quarter with a substantial cash and bullion balance of US$755 million, including US$683 million in cash and bullion valued at US$72 million. The company also holds US$229 million in liquid listed securities, notably a 17.8% stake in Predictive Discovery Limited. Perseus successfully refinanced and upsized its syndicated debt facility to US$400 million, enhancing financial flexibility with improved terms and a longer maturity profile.
The company continues its on-market share buy-back program, signalling confidence in its capital management strategy amid steady cash flows and strong liquidity.
Project Development and Exploration Progress
Development projects remain on track, with the CMA Underground mine in Côte d’Ivoire achieving a key milestone of first ore mined in January 2026 and commercial production expected by Q3 FY27. The Nyanzaga Gold Project in Tanzania is progressing well, with first production targeted for January 2027 and construction activities ahead of schedule.
Exploration activities continue across Perseus’s portfolio, including drilling programs at Yaouré, Sissingué, and Edikan mines, as well as ongoing work at the Meyas Sand Gold Project in Sudan despite regional challenges. These efforts aim to extend resource life and support future production growth.
Corporate Developments and Safety
Perseus’s proposed acquisition of Predictive Discovery was ultimately rejected following a competing offer from Robex Resources, which matched Perseus’s terms. While Perseus has not ruled out future proposals, it currently refrains from pursuing further bids.
Tragically, the quarter was marked by the loss of two contract employees in an offsite vehicle accident, highlighting ongoing safety challenges. The company reported a Total Recordable Injury Frequency Rate (TRIFR) of 0.83 and maintained a Lost Time Injury Frequency Rate (LTIFR) of zero, reflecting continued focus on safety management.
Outlook
Perseus reaffirmed its FY26 production guidance of 400,000 to 440,000 ounces, with an upward revision to AISC guidance of US$1,600 to US$1,760 per ounce due to higher gold prices and increased royalties. Production is expected to be weighted towards the second half of the year, supported by higher-grade ore from Edikan and Sissingué.
While the company navigates cost headwinds and royalty negotiations, its strong cash position and project pipeline position it well for sustained operational performance.
Bottom Line?
Perseus’s ability to manage rising costs and advance key projects will be critical as it balances growth ambitions with evolving fiscal pressures.
Questions in the middle?
- How will ongoing royalty negotiations with Côte d’Ivoire impact Perseus’s cost structure and profitability?
- What are the implications of the rejected Predictive Discovery acquisition for Perseus’s growth strategy?
- How will the CMA Underground and Nyanzaga projects influence production and cash flow in FY27 and beyond?