TORONTO, Aug. 6, 2025 /PRNewswire/ - Allied Gold Corporation (TSX: AAUC) $(AAUC)$ ("Allied" or the "Company") reports second quarter of 2025 production of 91,017 gold ounces which aligns with plan, represents an increase of 8.3% from last quarter, and positions the Company to meet its guidance for the year as presented below.
SECOND QUARTER HIGHLIGHTS
Operational Highlights
-- Production, Costs and Guidance: The Company produced 91,017 ounces of
gold in the second quarter, in line with plan, positioning the Company to
meet its guidance for the year. In the first half of the year, the
Company continued implementing improvements to its operations, and
undertook a series of operational enhancements and strategic initiatives
aimed at delivering a materially stronger going forward, beginning in the
second half of the year. These included confirmatory drilling of
high-grade areas, continued refinement of block models and grade-control
processes, progressive mobilization of new mining equipment at Sadiola
for material improvement of fleet availability and productivity, changes
to mine management hiring experienced local management including in Mali,
and continued advancing stripping at Bonikro and Agbaou to access higher
grade ore in the second half of the year and next, with increased
operational flexibility. These initiatives provide further confidence to
guidance, with production expected on the basis of 55% in the second half
of the year by comparison of 45% in the first half of the year. Third
quarter production is anticipated to be comparable to the second quarter,
while fourth quarter production is expected to be meaningfully higher at
118,000 to 122,000 ounces, driven mainly by higher grades. The increase
in production in the second half of the year, along with operational
improvements and mine sequencing, is expected to drive meaningful cost
improvements.
-- Sales of 81,103 gold ounces. Timing of final shipments resulted in 9,914
oz of gold production in Q2 that was sold in July for revenue of $30
million that will be recognized in the third quarter.
-- Total cost of sales(4), cash costs(1) and All-in Sustaining Costs
("AISC")(1) per ounce sold of $2,294, $2,034, and $2,343, respectively
(which include royalties based on higher gold prices and the amount for
increased waste removal at Agbaou which will result in higher production
in H2 and next year). The Company expects costs to be in line with annual
guidance taking into account higher gold prices on operating costs with
the previously disclosed gold price-based royalties. Second half AISC(1)
is anticipated to decrease and be approximately $1,850, based on a $3,000
gold price, from the normalization of timing of sales, higher production
and the benefit of disproportionate operating and stripping costs in the
first half. Further, the ongoing benefits from cost control and reduction
programs, the completion and commissioning of Phase 1 along with further
upside from potential oxide discoveries at Sadiola which provide
relatively inexpensive high-quality ounces, progressive cost improvements
quarter-over-quarter are expected. The impact on cash flows is magnified
in the fourth quarter, when production is guided to meaningfully
increase.
-- Results for the first half of the year and expectations for the second
half of the year are summarized as follows:
Q1 2025 Q2 2025 Q3 2025 Q4 2025
----------- -------------------------------- -------------------------------- --------------- -----------------
Production
ounces 84,040 91,017 88,000 - 91,000 118,000 - 122,000
AISC(1) $ 1,811 $ 2,343 Second half of year at
approximately $1,850
----------- -------------------------------- -------------------------------- ----------------------------------
-- Performance by Asset:
-- At Sadiola, production during the quarter was 49,283 ounces and
included continued contributions from the Korali-Sud zone,
demonstrating the significant production upside that new oxide
orebodies can provide to Sadiola in anticipation of the start of
production of the first phase expansion in the fourth quarter.
-- At Bonikro, production was 25,775 ounces driven by higher grade
ore mined from PB3, and improved throughput and recovered grade in
the process plant.
-- At Agbaou, production was 15,959 ounces. Following a plan for
longer term optimization and increases in mine life, the Company
prioritized waste removal over ore extraction to manage
storm-water inflows into the pit and to secure access to
higher-grade ore in the second half of 2025 as well as to support
increased operational flexibility and production levels in 2026.
While waste movement is expected to continue at similar levels for
the remainder of the year, ore feed, gold grades and production
are expected to materially increase quarter over quarter,
resulting in reduced costs and increased cash flows in the second
half of the year. Consequently, annual production for Agbaou, and
the benefits in the second half of the year, results in a
production expectation at the mid-point of guidance of
approximately 83,500 ounces.
-- Expansion of Exploration Success: Due to ongoing exploration successes
and proven delivery of results, the Company has committed a further $17
million in exploration spending. Of this total $5.7 million is allocated
for Sadiola, as the Company believes it can increase inventory
meaningfully, including finding new oxide ounces. At Côte d'Ivoire
(CDI) an additional $7.5 million has been allocated to pursue
opportunities to extend the mine life by increasing Mineral Reserves
through sustained drilling and other exploration efforts. At Kurmuk, an
additional $3.7 million was added to the exploration budget to support
the Company objective of achieving an inventory of 5 million gold ounces.
Total year exploration expenditure is now expected to be approximately
$37 million. The Company anticipates providing updates for Sadiola in
October, Kurmuk in November and CDI in January of 2026.
Financial Results Highlights
-- Earnings:
-- Second quarter net loss of $25.4 million or $(0.22) per share.
-- Second quarter adjusted earnings(1) of $16.2 million or $0.14 per
share.
-- Cash Flows and EBITDA
-- Net cash generated from operating activities for the quarter was
$22.0 million.
-- Operating cash flow before income tax paid and movements in
working capital was a strong inflow of $116.0 million.
-- EBITDA(1) and Adjusted EBITDA(1) for the three months ended June
30, 2025, were $23.0 million and $71.7 million, respectively.
-- Strong Financial Position: As of June 30, 2025, the Company had cash and
cash equivalents of $218.6 million. The Company has immediately available
credit of $50.0 million (inclusive of a $10.0 million accordion) under
its revolving credit facility, which remains undrawn. In addition to
available credit, the Company has liquidity available through future
draws on the Kurmuk gold stream. Available liquidity, coupled with an
anticipated step change in production and commensurate cost reduction for
the remainder of the year resulting in additional flexibility from
increased cash flows, positions the Company to execute on Kurmuk's
remaining capital expenditures.
Advancement of Key Growth Initiatives
Kurmuk: The Company continues to track well against plan for the Kurmuk Project, both in terms of physical completion and spend, having continued to achieve key milestones and progress during the second quarter of 2025. The Company is well-positioned to achieve the goal of commencing production by mid-2026. Being less than a year away from first production, the Company is advancing technical studies aimed at improving operational confidence and flexibility, including potential increases in plant throughput among other improvements and targeted optimizations.
At the end of the second quarter, Engineering and Procurement have achieved approximately 90% progress. Transportation of key equipment is advancing well, with delivery to site of key components such as the Carbon-in-Leach ("CIL") tanks and grinding mills. Structural fills at the plant terrace were completed. Key areas, including crushing, grinding, and leaching, were handed over to the civil works contractor, allowing rebar installation and concrete works. Key bulk earthworks progress outside the process plant area was achieved ahead of the rainy season. Structural, Mechanical, Plate and Piping $(SMPP)$ contractor fabrication is progressing well, and development of the main accommodation camp is nearing completion. Mobilization of the mining fleet is ongoing with the site delivery expected imminently, and mining pioneering was completed during the quarter.
For the quarter ended June 30, 2025, $71.3 million was spent on the Kurmuk project, comprising direct construction capital expenditures and exploration activity.
The Company remains positioned to achieve the next milestones, which include:
-- Bulk mining activities start in third quarter 2025
-- Completion of engineering in third quarter 2025
-- Mechanical erection ramp-up in third quarter 2025 in CIL area
-- CIL area completed in first quarter 2026
-- Power line completion in first quarter 2026
-- Commissioning start in second quarter 2026
-- First gold in second quarter 2026
A November update is planned for Kurmuk Mineral Resources and Mineral Reserves, in relation to the infill drilling effort carried thus far to support the start of mining activities, along with an exploration update on the different targets throughout the property. The Company expects Kurmuk to produce an average of 290,000 ounces per year for the first four years and 240,000 ounces per year on average for the mine's life, with AISC(1) below $950 per ounce.
Sadiola Phased Expansion: The first phase of expansion at Sadiola advanced on schedule and on budget during the second quarter. Earthworks, civil works and structural fill, along with engineering and procurement, are progressing well with engineering and procurement essentially complete. The first components of the modular three-stage crushing plant have been shipped to site, and preparatory earthworks in the area have commenced. The mill motor has landed on site, as have the mill components. The first batch of structural steel has arrived on site and erection will commence imminently. Major mechanical equipment, including the cyclones and pumps are en route and will arrive on site for installation during the third quarter. The current third quarter focus will be on installation of structural steel and mechanical equipment allowing for follow-on completion of the electrical, control and instrumentation installation scope and commissioning in the fourth quarter.
Continued investment in the first phase expansion, including planned plant modifications and infrastructure upgrades, is consistent with prior estimates at $70 million in 2025. The first phase plant expansion involves installing additional crushing and grinding capacity in one of the processing plant lines, which will be dedicated to treating fresh ore. These modifications will allow Sadiola to treat up to 60% of fresh rock at a rate of up to 5.7 Mt/y in the modified process plant. With the completion of the first phase expansion, Sadiola is expected to produce between 200,000 and 230,000 ounces of gold per year in the medium term, ahead of the next expansion phase.
The Phase 2 Expansion, planned as a new processing plant to be built beginning in late 2026 and dedicated to processing fresh rock and oxides at a rate of up to 10 Mt per year, targeted to start production in late 2028, is expected to increase production to an average of 400,000 ounces per year for the first four years and 300,000 ounces per year on average for the mine's life, with AISC(1) expected to decrease to below $1,200 per gold ounce.
Strategic Initiatives Highlights
Allied executed a number of strategic transactions and initiatives during the second quarter, reinforcing a fortress balance sheet, further improving the Company's financial flexibility, enhancing trading liquidity and broadening the shareholder base. The transactions include:
-- Sadiola Strategic Arrangements
In the process of reviewing its power needs and overall power supply strategy, particularly in relation to Sadiola, the Company engaged with several parties over the course of the year, and it previously announced that it was negotiating a broader arrangement that included a power supply agreement and a sale of a portion of the Company's ownership in Sadiola with Ambrosia Investment Holding ("Ambrosia"). Subsequently, the Company also received a proposal from a third party for the purchase of a portion of Sadiola, on comparable terms. While the Company continues discussions relating to possible broader corporate transactions with Ambrosia and others, Allied has determined that selling any portion of Sadiola should not be undertaken at this time, and the pursuit of a power solution for Sadiola should be undertaken independently of broader corporate or asset level transactions. In addition to available independent power solutions being better priced and scaled, there has been considerable advancement with Sadiola that supports considerably greater value.
The Company has significantly advanced its analysis of power supply requirements for various expansion scenarios at Sadiola following the Phase 1 expansion. It has made substantial progress in assessing and negotiating the implementation of robust, proven, self-sufficient, pure-power solutions with experienced African power generation specialists. These solutions are tailored to the phased expansion approach at Sadiola, allowing for the progressive implementation of sustainable and reliable off-grid solutions. These pure-power solutions will enable the Company to deploy the optimal renewable energy penetration rate for each stage of the expansion project, improving energy supply reliability at all times, and achieving meaningful medium-term savings over the next five years, while remaining competitive in the longer term compared to the Ambrosia proposal, which had a higher capital intensity associated with a large-scale solar plant covering the requirements of the Phase 1 expansion, that led to meaningfully higher costs of power in the short to medium term.
Given the results of this process and the strategic relevance of self-reliant power supply, which has become a stated goal of the government in Mali, the Company has decided to advance the implementation of a self-reliant power generation solution for the site. This enables the Company to pursue an optimal solution for Sadiola, in collaboration with specialized and renowned partners, and where the Company also holds a significant ownership interest in the energy infrastructure. The Company is currently completing negotiations with a select group of companies for the long-term supply of energy to Sadiola. The solutions propose a phased deployment of a combination of off-grid thermal generation and solar-battery energy sources, offering a competitive levelized cost of energy compared to previous studies and the market. Allied expects to settle the framework agreements imminently and complete contract negotiations by the beginning of the fourth quarter of 2025. Amongst the many advantages of this solution, it creates more efficiency than pure solar alone, is cost effective and it is scalable to accommodate the larger expansion of Phase 2, or the incremental expansions between Phases 1 and 2 whose technical studies are being completed.
The Company concluded that it is able to execute its development strategy for Sadiola without the need to divest any stake in the asset, retaining ownership and gold-price leverage of a high-quality asset and exploration portfolio that has increased in value since the beginning of the year. Sadiola continues to stand out as a Tier-1 asset, underpinned by a strong operational base, significant mineral reserves and a leading production growth profile.
This confidence, and reasons to maintain full ownership of the asset and seek better terms with another power-solution partner, is supported by gold prices being substantially higher than at the time of engagement with the above-mentioned parties which significantly appreciates the value of the asset, the ongoing Phase 1 expansion being well advanced and on track for first gold production this year, improvements in governmental and other similar stakeholder engagements in Mali, a significantly improved and improving business environment in country, improved mine plans and management of the asset, and the advancement of engineering studies to assess the merits of a progressive expansion after Phase 1. This progressive approach targets reduced capital requirements in the medium term, leveraging the existing processing infrastructure. Furthermore, Allied is advancing test-work and engineering studies aimed to meaningfully increase metallurgical recoveries through the implementation of flotation and concentrate leaching as an add-on to the project. In addition to these technical studies and opportunities aimed at unlocking significant value and optionality, Allied has made significant progress on developing new oxide targets near mine, and is actively pursuing their conversion to mineral inventories and potential development, supported by an increased exploration budget and drilling program at Sadiola, focused on near-plant oxide opportunities.
As noted, Allied has positioned itself as a reliable partner with the Malian government, being the first company to adopt a new mining protocol in light of the 2023 mining code. The Company continues advancing discussions with SOREM (Mali state-owned mining company) to pursue potential mining opportunities in the vicinity of Sadiola and other highly prolific areas in Mali. While definitive arrangements have not been concluded at this time, the Company is in advanced discussions and is encouraged with the prospects under evaluation and the cooperativeness and ongoing engagement with in-country authorities.
With all of these regional, economical and technical factors considered, the Company believes that the implied value of Sadiola has increased significantly during a time coincident with the Company's conclusion that pursuing a self-reliant independent and optimized power solution is a better way to create value.
-- New York Stock Exchange Listing: Allied began trading on the NYSE under
the ticker symbol AAUC on June 9, 2025. Allied believes that listing on
the NYSE will provide the Company with, among other things, access to a
broader investor audience, increased sources of potential capital,
improved trading liquidity in Allied's common shares, and increased
research coverage from U.S. investment banks. Finally, the listing is
expected to provide the opportunity for broader index inclusion.
-- Common Share Consolidation: In May of 2025, and in connection with the
Company's application to list its common shares on the NYSE, the Company
completed a share consolidation on the basis of one post-consolidation
common share for every three pre-consolidation common shares outstanding.
-- Bought Deal Public Offering and Concurrent Block Trade: During the
quarter, in April of 2025, the Company successfully closed on a bought
deal public offering, and a significant shareholder of the Company
completed a concurrent block trade transaction of common shares owned by
such shareholder. The offering was for an aggregate of 17,250,000 common
shares at a price of C$5.35 per share (on a pre-consolidation basis) for
aggregate gross proceeds of $66.8 million and net proceeds of $61.9
million.
Enhancing market liquidity remains a key objective for the Company. Over the past 18 months, average daily trading volume, measured over a 20-day period, has increased approximately ninefold. The significant shareholder's block trade and the Company's offering further improved trading liquidity in advance of the Company's listing on the New York Stock Exchange. These transactions also support broader index inclusion and additional investor interest, all of which should help the Company's share price better reflect the Company's intrinsic value per share.
The Company intends to use the net proceeds from the offering to fund its optimization and growth initiatives, including advancing studies and engineering work to improve recoveries at Sadiola, supporting exploration and mine life extension studies in Côte d'Ivoire, and conducting additional exploration and development activities across its broader asset portfolio. The proceeds of the offering are expected to assist the Company in accelerating value creation from these assets and associated activities.
-- Zero-Cost Collar Execution: On May 7, 2025, the Company completed a gold
price protection program that ensures a minimum price of $3,048 per ounce
and full upside to $4,000 per ounce on gold production of 15,500 ounces
per month from June 2025 through to March 2026, equalling a total of
155,000 ounces. Inclusive of already existing gold production under
preceding gold price protection through March of 2026, this represents
approximately 75% of total production in that period, thereby ensuring
higher margins and cash flows as the Company completes the development of
Kurmuk.
Sustainability, Health and Safety Highlights
-- The Company did not report any significant Environmental Incidents for
the three months ended on June 30, 2025.
-- The Company's Total Recordable Injury Rate (TRIR) was 0.87, compared to a
TRIR of 1.08 in the comparative prior year quarter.
-- In terms of Lost Time Injuries ("LTI"), the Company reported two LTI for
the three months ended June 30, 2025, compared to two LTI in the
comparative prior year quarter, which results in a Company Lost Time
Injury rate ("LTIR") for the three months ended June 30, 2025 of 0.35,
compared to a LTIR of 0.54 in the comparative prior year quarter.
Summary of Operational Results
For three months
ended June 30,
2025
-------------------------------- --------------------------
Gold ounces
Production 91,017
Sales(8) 81,103
Per Gold Ounce Sold
Total Cost of Sales(4) $ 2,294
Cash Costs(1) $ 2,034
AISC(1) $ 2,343
Average revenue per ounce $ 3,098
Average market price per ounce* $ 3,280
----------------------------------- --------------------------
*Average market prices based on the LBMA PM Fix Price
Gold production of 91,017 ounces during the three months ended June 30, 2025, was in line with expectations and driven by strong performance at Bonikro and Sadiola. As previously disclosed, production for the year is expected to follow a 45%/55% weighting between the first and second half, with the fourth quarter being the strongest of the year.
Total cost of sales(4) on a per gold ounce sold basis of $2,294 for the three months ended June 30, 2025. Cash costs(1) on a per gold ounce sold basis of $2,034 for the three months ended June 30, 2025. AISC(1) on a per ounce gold sold basis for the current quarter of $2,343. As described in the Company's annual guidance, every $100 per ounce increase in the price of gold results in $15 per ounce higher consolidated AISC(1) , which was based on a baseline for guidance of $2,500 per ounce, and at an average realized price in excess of $3,250 per ounce for the second quarter, consolidated AISC(1) was impacted by over $100 per ounce, impacting all mines, but disproportionately higher at Sadiola where gold price alone resulted in a $250 per ounce increase. At Bonikro, all unitary costs metrics were in line with plan. At Agbaou, following a plan for longer term optimization and increases in mine life, the Company prioritized waste removal over ore extraction to manage storm-water inflows into the pit and to secure access to higher-grade ore in the second half of 2025 as well as to support increased operational flexibility and production levels in 2026. Stripping costs in the second quarter, in the amount of $13.2 million, had a large impact on AISC(1) over the 14,938 ounces sold. Mine sequencing and the increase in stripping resulted in approximately $850 more AISC(1) per ounce in relation to the first quarter of 2025. While waste movement is expected to continue at similar levels for the remainder of the year, ore feed, gold grades and production are expected to materially increase quarter over quarter, resulting in reduced costs and increased cash flows in the second half of the year. Consequently, annual production for Agbaou, and the benefits in the second half of the year, results in a production expectation at the mid-point of guidance of approximately 83,500 ounces. In addition to operational factors, increased waste removal in 2025 allows for less reliance on short-term resource conversion to support production levels in 2026, creating a bridge to focus additional exploration spending at Agbaou on more transformational targets aimed at adding ounces and with an objective to increase mine life at Agbaou by four to six years, with the completion of the first stage exploration program in 2026. Production in 2026 is expected to further increase from the current year.
At Sadiola, as previously disclosed, the 2023 mining code is expected to impact costs by approximately $240 to $300 per ounce, with Korali-Sud attracting further government and third-party royalty burdens of an additional $200 per ounce, as it is subject to the full impact of the 2023 mining code without derogation of royalties. With continued contributions from Korali-Sud during the quarter, costs were impacted commensurately. Sadiola costs in the first quarter of 2025 were positively impacted by the sale of significant levels of Korali inventory from 2024. Had those ounces not been sold in the first quarter of 2025, Sadiola AISC(1) would have been approximately $2,150. As such, the change in costs in the second quarter over the first quarter is predominantly from the higher gold price and its impact on royalties. When compared to the prior year comparative quarter, increased gold prices and the 2023 mining code have resulted in an impact of approximately $600 per ounce in the Sadiola structure year-over-year.
Gold sales(8) of 81,103 ounces for the quarter ended June 30, 2025 compared to 84,611 ounces sold in the comparative quarter. Gold sales differed from production due to the timing of gold pours and final shipments before quarter end. The resulting build-up in finished goods inventory has been sold in July.
Average revenue per ounce generally diverges modestly from the average market price due to the impact of ounces delivered under the streams.
Sadiola (80% interest), Mali
Sadiola comprises the Sadiola (80% interest) open pit gold mine, located in the Kayes region of Mali, as well as the Korali-Sud open pit gold mine (65% interest), 15 kilometres south of the processing plant at Sadiola. The remaining ownership in Sadiola is retained by the Government of Mali.
For three months
ended June 30,
-------------------------------------------
Sadiola Key Performance Information
(100% Basis) 2025
------------------------------------------- ------------------------
Operating
Ore mined (M tonnes) 1.55
Waste mined (M tonnes) 6.10
Ore processed (M tonnes) 1.29
Gold
Production (Ounces) 49,283
Sales(8) (Ounces) 43,648
Feed grade (g/t) 1.31
Recovery rate (%) 89.1 %
Total cost of sales per ounce sold(4) $ 2,493
Cash costs per ounce sold(1) $ 2,351
AISC per ounce sold(1) $ 2,471
Financial (In thousands of US Dollars)
Revenue $ 138,985
Cost of sales (excluding DDA) (103,175)
---------------------------------------------- ------------------------
Gross profit excluding DDA(1) $ 35,810
DDA (5,635)
---------------------------------------------- ------------------------
Gross Profit $ 30,175
---------------------------------------------- ------------------------
Capital Expenditures (In thousands of US
Dollars)
Sustaining $ 978
Expansionary 20,194
Exploration 40
---------------------------------------------- ------------------------
For the three months ended June 30, 2025, Sadiola produced 49,283 ounces of gold. Production in the quarter was in line with plan and annual guidance, and includes the continued contribution from Korali-Sud high-grade oxide ore, as well as its fresh ore, through co-processing of Sadiola and Korali ores. Co-processing started on May 6, 2025 and is expected to continue into the third quarter of 2025. This initiative maximizes production, with clay content from Korali-Sud being mitigated by ore coming from Sadiola. Production is now fully supported by active pit mining, ending reliance on stockpiles, while unlocking improved grade control and mine-to-mill predictability, which sets a stronger base for long-term cost management. The Company is actively evaluating the future contribution of Korali-Sud and other new sources of oxide ore identified within the Sadiola mining licence with an update expected to be provided in due course. Oxide ore is favoured in the short term as it provides the plant with relatively inexpensive, high quality ounces.
Instrumentation upgrades to the process-plant are progressing with improvements in throughput, delivering an additional 171,000 tonnes from January through to May, resulting in over 5,900 more recovered ounces during the this period in relation to plan. Further savings in elution reagent costs are expected, driven by a reassessment of reagent-rate value calculations. Additional improvements include optimization of the regrind mill cyclone performance, and an upgrade to the feed-pump capacity at the processing plant. Once completed, further gains in throughput and recovery are expected. Commissioning of the Phase 1 process plant upgrade will supplement the ongoing instrumentation upgrade efforts.
At Sadiola, as previously disclosed, the 2023 mining code is expected to impact costs by approximately $240 to $300 per ounce, with Korali-Sud attracting further government and third-party royalty burdens of an additional $200 per ounce, as it is subject to the full impact of the 2023 mining code without derogation of royalties. With continued contributions from Korali-Sud during the quarter, costs were impacted commensurately. Sadiola costs in the first quarter of 2025 were positively impacted by the sale of significant levels of Korali inventory from 2024. Had those ounces not been sold in the first quarter of 2025, Sadiola AISC(1) would have been approximately $2,150. As such, the change in costs in the second quarter over the first quarter is predominantly from the higher gold price and its impact on royalties.
AISC(1) for the quarter was $2,471 per gold ounce. As described in the Company's annual guidance, every $100 per ounce increase in the price of gold results in $15 per ounce higher consolidated AISC(1) , which was based on a baseline for guidance of $2,500 per ounce, and at an average realized price in excess of $3,250 per ounce for the second quarter, consolidated AISC(1) was impacted by over $100 per ounce, impacting all mines, but disproportionately higher at Sadiola where gold price alone resulted in a $250 per ounce increase.
Sadiola Expansion Project and Korali-Sud
The first phase of expansion at Sadiola broke ground in the fourth quarter of 2024 and advanced on schedule and on budget during the second quarter. Earthworks, civil works and structural fill, along with engineering and procurement, are progressing well with engineering and procurement essentially complete. The first components of the modular three-stage crushing plant have been shipped to site, and preparatory earthworks in the area have commenced. The mill motor has landed on site, as have the mill components. The first batch of structural steel has arrived on site and erection will commence imminently. Major mechanical equipment, including the cyclones and pumps are en route and will arrive on site for installation during the third quarter. The current third quarter focus will be on installation of structural steel and mechanical equipment allowing for follow-on completion of the electrical, control and instrumentation installation, and commissioning in the fourth quarter.
Continued investment in the first phase expansion, including planned plant modifications and infrastructure upgrades, is consistent with prior estimates at $70 million in 2025. The first phase plant expansion involves installing additional crushing and grinding capacity in one of the processing plant lines, which will be dedicated to treating fresh ore. These modifications will allow Sadiola to treat up to 60% of fresh rock at a rate of up to 5.7 Mt/y in the modified process plant starting during the fourth quarter of 2025. With the completion of plant modifications in the first phase, Sadiola is expected to stabilize and produce between 200,000 and 230,000 ounces of gold per year in the medium term, ahead of the next phase of expansion. The Phase 2 Expansion, planned as a new processing plant with planned project commencement in late 2026 and dedicated to processing fresh rock and oxides at a rate of up to 10 Mt per year, targeted to start production in late 2028, is expected to increase production to an average of 400,000 ounces per year for the first four years and 300,000 ounces per year on average for the mine's life, with AISC(1) expected to decrease to below $1,200 per gold ounce.
Further, the Company is conducting engineering studies to determine the optimal path for a progressive, phased expansion of the existing plant beyond the year 2025, with the objective to target similar ultimate production levels at improved capital intensity. This will be achieved by advancing opportunities for optimization of the Sadiola Gold Mine Expansion Projects, including metallurgical test work and a pre-feasibility study to potentially increase recoveries by over 10 percentage points through the use of flotation and concentrate leaching. The progressive expansion would facilitate treatment of Fresh Ores, potentially reducing the requirements for a future single, major capital expenditure and accelerating gold production through increased plant throughput. These studies, supported by the Company's phased investment, seek to improve Sadiola's financial performance significantly. With this long-term and value-focused strategy, the Company is well-positioned to affirm that the advancement of the Sadiola Gold Mine Project is proceeding as planned, reinforcing Allied's commitment to operational excellence and long-term value creation.
Sadiola Exploration
Since acquiring the Sadiola Project in 2021, Allied has identified over 15 million tonnes of economic oxide mineralization within the near-mine footprint, significantly enhancing the oxide resource base critical for the existing and planned processing infrastructure. Ongoing exploration activities at Sekekoto West, FE4, FE2 Trend and Tambali South are crucial to Allied's strategy to leverage the existing resources and infrastructure to maximize production and cash flows in the short term.
During the quarter, exploratory and resource drilling programs were conducted on the Sadiola licence. A total of 273 holes were drilled totalling 24,627 metres by five exploration drill rigs. Resource and exploratory drilling programs continued and were expanded at the Sekekoto West, Tambali and FE4 deposits, and at the FE2.5 prospect during the quarter. A sterilization drill program over a proposed new tailings storage facility, to the east of Sadiola Mine continued and is expected to be completed in the third quarter.
Exploratory drilling at Sekekoto West deposit was extended to the north during the quarter with drillhole intersections demonstrating that the deposit remains open 500 metres to the north outside of the current pit designs. Further drilling is planned to continue testing for strike extensions of this mineralized trend to the north and south.
At the Tambali deposit, deeper core drilling of the fresh rock mineralization is being carried out on 100 metre section lines with a goal to be completed in the third quarter of 2025. Drillhole intersections demonstrate good continuity of economic mineralization to 320 metres depth. An updated geological model completed in the second quarter will provide guidance for further drill testing of this deposit in subsequent programs.
At FE4, a 199-hole drill program, now 29% completed, is being carried out to both upgrade inferred mineral resources to Indicated and test for extensions to the known mineralization. Results to date have been encouraging.
Drilling continued to the north of the 1.1 kilometre-long FE2.5 oxide gold prospect and extended oxide gold mineralization for another 1.1 kilometres further north to the south end of the historic 1.2 kilometre long FE2 pit. Oxide gold mineralization has now been followed, more or less continuously for 3.4 kilometres and is open to the north and, less so, to the south. Drilling will continue to test this limestone/clastic sediment trend with wide-spaced holes for another 2 kilometres to the north of the FE2 pit with a goal to exhibit potential for shallow oxide gold resources along the entire 5.5 kilometre long trend. Once the scope of the mineralization is defined, a systematic program of resource conversion will be carried out as required.
Further, Sadiola will also see continued efforts with five drills dedicated to continue testing for and extending the gold mineralized structures at Sadiola Main, Tambali, FE2 Trend, Sekekoto Trend and FE4 with a further budget of $5.7 million. The exploration is focused on both oxide and fresh mineralization with a preference for oxide gold mineralization in the near term. Oxide ore is favoured in the short term as it provides the plant with relatively inexpensive, high quality ounces. The horizontal and down-dip/down-plunge limits of these systems have not been defined yet and expectations of ongoing discovery/additions are high. A sixth drill will begin to follow up on other mineralized structures/ideas over the property area.
Bonikro (89.89% interest), Côte d'Ivoire
The Bonikro gold mine is an open pit gold mine located in the Oumé region of Côte d'Ivoire ("Bonikro" or "Bonikro Mine"). The remaining ownership is split between the Government of Côte d'Ivoire (10%) and a local minority shareholder (0.11%).
Bonikro is contiguous to Agbaou, and together they comprise the CDI Complex, with the two processing plants located only 20 km from each other. The combined milling capacity and existing infrastructure including water supply dams, tailings storage facilities, access and site roads, power supply and accommodation facilities, provide optionality and significant synergies.
Bonikro comprises two separate mining licences (the Bonikro Licence and Hiré Licence), although integrated as a single operation.
For three months
ended June 30,
--------------------------------------------
Bonikro Key Performance Information
(100% Basis) 2025
-------------------------------------------- -----------------------
Operating
Ore mined (M tonnes) 0.59
Waste mined (M tonnes) 5.05
Ore processed (M tonnes) 0.63
Gold
Production (Ounces) 25,775
Sales (Ounces) 22,517
Feed grade (g/t) 1.26
Recovery rate (%) 95.0 %
Total cost of sales per ounce sold(4) $ 1,928
Cash costs per ounce sold(1) $ 1,384
AISC per ounce sold(1) $ 1,592
Financial (In thousands of US Dollars)
Revenue $ 66,564
Cost of sales (excluding DDA) (31,361)
----------------------------------------------- -----------------------
Gross profit excluding DDA(1) $ 35,203
DDA (12,056)
----------------------------------------------- -----------------------
Gross Profit $ 23,147
----------------------------------------------- -----------------------
Capital Expenditures (In thousands of US
Dollars)
Sustaining $ 12,877
Expansionary --
Exploration 2,292
----------------------------------------------- -----------------------
Bonikro produced 25,775 ounces of gold during the three months ended June 30, 2025, in line with plan and annual guidance. The strong production was driven by higher grade ore mined from PB3, and improved throughput and recovered grade in the process plant. Improved plant throughput was achieved with the completion of plant enhancements, increased crusher availability, improved fragmentation, and enhanced maintenance practices.
Bonikro remained on plan in the quarter, benefiting from mine sequencing into higher-grade zones and stable plant performance. Throughput improved following enhancements to the comminution circuit, including screen panel modifications that lifted mill rates by nearly 9%. Gains were also supported by better crusher availability and proactive maintenance routines.
The ongoing stripping campaign at PB3 and PB5 in the first half of the year positions the Company on track to expose higher-grade material for the last quarter of 2025, as well as the following years, with minimal waste stripping expected during 2026 and 2027. This mining sequencing at Bonikro, for an anticipated $60 million of capital expenditures related to production stripping during 2025, will lead to robust free cash flows, as the stripping ratio decreases and it further exposes higher-grade ore. As the waste stripping benefits not only 2025 but also the following two years of production, the AISC(1) per ounce sold figure accounts for the allocation of the stripping spend over the ounces it benefits through 2027.
The Company has now succeeded in implementing a centralized management model for both mines in CDI, streamlining processes, optimizing resources, and enhancing service delivery for sustainable growth, and lowering AISC(1) . The Company anticipates waste stripping in the third quarter at similar levels than that completed during the second quarter, after which Bonikro PB5 be able to provide higher-grade ore for the remaining years of its current life. Costs for the period were in line with plan.
Gold sales differed from production due to the timing of gold pours and final shipments before quarter end. The resulting build-up in finished goods inventory has been sold in July.
Hiré and Oumé Exploration
Resource and exploration drilling was conducted during the quarter on the Company's mining licences and exploration licences.
At the Hiré mine, three rigs defined relatively narrow lenses of oxide gold mineralization traceable for 550 metres and 1,100 metres at the Assondji-So Marais and Assondji-So South areas, respectively. Both of these zones lie within the southwest part of the compensation area with mineralization expected to extend to the west outside of the permitted area. Work to further extend the Assondji So South mineralization, to the southwest, is expected to begin in the third quarter. Scout drilling also started immediately south of the Assondji So pit over an area of historic artisanal workings. This work is expected to continue into the third quarter. A program is also planned to commence in the third quarter to test the underground potential of the gold mineralization below the Akissi So pit.
Oumé Exploration
At the Oumé Project, drilling to convert Inferred mineral resources to Indicated mineral resources was completed at the Dougbafla North prospect with some holes designed to extend the zone across strike and to depth. Drilling resumed over the Dougbafla West deposit with a goal to infill and extend the mineralized lenses with drilling continuing into the third quarter. Exploration work plans have been proposed to the east of the Dougbafla Central zone and SW of the Dougbafla West Prospect as the limits of the Oumé mineralized systems have not been defined yet. One of the goals of the step out drilling is to identify additional felsic intrusions along the shear corridor where wider mineralized zones would be expected.
Agbaou (85% interest), Côte d'Ivoire
Agbaou is an open pit gold mine, located in the Oumé region of Côte d'Ivoire. The remaining ownership is split between the Government of Côte d'Ivoire (10%) and the SODEMI development agency (5%).
Agbaou is contiguous to Bonikro, and together they comprise the CDI Complex, with the two processing plants located only 20 km from each other.
For three months
ended June 30,
--------------------------------------------
Agbaou Key Performance Information
(100% Basis) 2025
-------------------------------------------- -----------------------
Operating
Ore mined (M tonnes) 0.41
Waste mined (M tonnes) 9.71
Ore processed (M tonnes) 0.59
Gold
Production (Ounces) 15,959
Sales (Ounces) 14,938
Feed grade (g/t) 0.89
Recovery rate (%) 94.7 %
Total cost of sales per ounce sold(4) $ 2,267
Cash costs per ounce sold(1) $ 2,085
AISC per ounce sold(1) $ 3,104
Financial (In thousands of US Dollars)
Revenue $ 46,430
Cost of sales (excluding DDA) (30,366)
----------------------------------------------- -----------------------
Gross profit excluding DDA(1) $ 16,064
DDA (3,495)
----------------------------------------------- -----------------------
Gross Profit $ 12,569
----------------------------------------------- -----------------------
Capital Expenditures (In thousands of US
Dollars)
Sustaining $ 13,721
Expansionary --
Exploration 989
----------------------------------------------- -----------------------
Agbaou produced 15,959 ounces of gold during the three months ended June 30, 2025, and aligned with the revised mine sequence. Production in the quarter was the result of higher oxide grade mined in the Agbale pit and treated at Agbaou. This allowed for increased throughput in the process plant. The performance was supported by mining fleet performance optimization and the implementation of enhanced short-interval controls.
At Agbaou, the Company prioritized waste removal over ore extraction to manage storm-water inflows into the pit and to secure access to higher-grade ore in the second half of 2025 as well as to support increased operational flexibility and production levels in 2026. Stripping spend in the second quarter, which amounted to $17.9 million, had a large impact on AISC(1) over the 14,938 ounces sold. While waste movement is expected to continue at similar levels for the remainder of the year, ore feed, gold grades and production are expected to materially increase quarter over quarter, resulting in reduced costs and increased cash flows in the second half of the year. In addition to operational factors, increased waste removal in 2025 allows for less reliance on short-term resource conversion to support production levels in 2026, creating a bridge to focus additional exploration spending at Agbaou on more transformational targets aimed to add ounces and with an objective to increase mine life at Agbaou by four to six years, with the completion of the first stage exploration program in 2026. Production in 2026 is expected to further increase from the current year.
The Company has now succeeded in implementing a centralized management model for both mines in CDI, streamlining processes, optimizing resources, and enhancing service delivery for sustainable growth, and lowering AISC(1) . The benefits of the centralized contractor model and the Hub-and-Spoke structure implemented are becoming more evident, enabling improved agility in managing shared resources and coordinating recovery efforts across sites. These enablers will be further embedded in the coming months as the Company transitions from initiation to full execution. Looking ahead, execution discipline will remain central to delivering value in the second half. With deeper integration of the Hub-and-Spoke model, continued focus on plant optimization, and improved mining flexibility.
Costs for the second quarter, as anticipated, reflect the significant increase in stripping at WP 7, which will benefit access to oxide ore in the later part of 2025, partially offset by the successful implementation of a centralized management model. This is expected to result in higher production at lower costs for the remainder of 2025, as second half of the year sustaining capital significant decreases in the third quarter, and is minimal in the fourth quarter.
Gold sales differed from production due to the timing of gold pours and final shipments before quarter end. The resulting build-up in finished goods inventory has been sold in July.
Agbaou Exploration
Allied is actively pursuing opportunities to extend the mine life by increasing Mineral Reserves through sustained drilling and other exploration efforts. In the second quarter of 2025, with a further budget of $7.5 million for the year, the Company launched a focused initiative comprising two strategic projects aimed at accelerating this objective.
The first project targets the Agbaou West and East pits, with the goal of upgrading Inferred Mineral Resources to Indicated Mineral Resources to test for down dip extensions of known mineralization and to test for new lenses. The drilling campaign, structured in three phases, commenced in July, 2025, and is scheduled for completion in the first half of 2026. The program's goal is to add several more years to mine life.
The second project focuses on the Hire-Akissi So target, where the Company is working to confirm the presence of an underground mineable resource at grades ranging from 3 to 4 g/t of gold. This two-phase drilling program also commenced in July 2025, and is expected to conclude by late first quarter of 2026.
Allied anticipates reporting progress on these initiatives by delivering a program status update in the second quarter of 2026. Up to seven core drills will be devoted to these two programs with one other RC drill dedicated to testing new targets.
Kurmuk, (100% interest(7) ), Ethiopia
The Company continues to track well against plan for the Kurmuk Project, both in terms of physical completion and spend, having achieved key milestones and progress during the second quarter of 2025. The Company remains positioned to achieve the next milestones, which include:
-- Bulk mining activities start in third quarter 2025, -- Completion of engineering in third quarter 2025, -- Mechanical erection ramp-up in third quarter 2025 in CIL area, -- CIL area completed in first quarter 2026, -- Power line completion in first quarter 2026, -- Commissioning start in second quarter 2026, -- First gold in second quarter 2026.
Being less than a year away from first production, the Company is advancing technical studies aimed at improving operational confidence and flexibility, including potential increases in plant throughput among other improvements and targeted optimizations. The Company is also advancing a detailed review of the remaining aspects of the project, including project supply chain and logistics. Notable quarterly updates include:
-- Engineering and Procurement have achieved approximately 90% progress.
Transportation of key equipment is advancing well, with delivery to site
of key components such as the Carbon-in-Leach ("CIL") tanks and grinding
mills.
-- Structural fills at the plant terrace were completed.
-- Critical areas including crushing, grinding, and CIL were handed
over to the civil contractor, allowing rebar installation and
concrete works:
-- Foundation work for all CIL tanks and thickeners is
complete and handed over to the Structural, Mechanical,
Plate and Piping ("SMPP") contractor.
-- Concrete casting for both the SAG and Ball mill has been
finalized, marking a key milestone in plant infrastructure
readiness.
-- Works are progressing on the primary crusher, stockpile
tunnel, process water tanks, and reagents facilities in
line with the schedule.
-- Key bulk earthworks progress outside the process plant area was
achieved ahead of the rainy season, including:
-- Substantial completion of the water storage dam, a critical
milestone for water capture ahead of the wet season.
-- The construction of the explosives magazine facilities is
progressing as planned, with work on track to support the
scheduled arrival of the first explosives on site.
-- The construction of the airstrip has been completed,
marking a key logistics, safety and security milestone for
the project.
-- SMPP contractor fabrication is progressing well, and site
mobilization is advancing through a phased approach focused on
erecting the permanent camp ancillary facilities.
-- Development of the main accommodation camp is nearing completion,
with key support facilities including a 1,200-person kitchen,
administration building, clinic, and laundry being actively
managed to accommodate the project's expanding workforce and
mobilization needs.
-- Mobilization of the mining fleet is ongoing with the site delivery
expected imminently.
-- Meanwhile, the Company completed pioneering mining activities for
the establishment of access and infrastructure. Mining activities
will continue throughout the year and into 2026, with the
objective of preparing the mine and building ore stockpiles to
support the commissioning stage and the start of operations.
Kurmuk is expected to produce first gold by mid-2026, contributing an estimated 175,000 ounces of gold in the second half of 2026. On a year-to-date basis, $127.4 million has been spent on the Kurmuk Project, comprising direct construction capital expenditures and exploration activity, with $71.3 million spent in the quarter.
A November update is planned for Kurmuk Mineral Resources and Mineral Reserves, in relation to the infill drilling effort carried thus far to support the start of mining activities, along with an exploration update on the different targets throughout the property.
Operational Summary
For three months ended Production Sales June 30, Gold Gold Cost of Sales Per Cash Cost(1) Per Gold AISC(1) Per 2025 Ounces Ounces Gold Ounce Sold Ounce Sold Gold Ounce Sold -------- ---------- ------ ---------------------- ---------------------- ---------------------- Sadiola Gold Mine 49,283 43,648 $ 2,493 $ 2,351 $ 2,471 Bonikro Gold Mine 25,775 22,517 $ 1,928 $ 1,384 $ 1,592 Agbaou Gold Mine 15,959 14,938 $ 2,267 $ 2,085 $ 3,104 -------- ---------- ------ ---------------------- ---------------------- ---------------------- Total 91,017 81,103 $ 2,294 $ 2,034 $ 2,343 -------- ---------- ------ ---------------------- ---------------------- ----------------------
FINANCIAL SUMMARY AND KEY STATISTICS
Key financial operating statistics for the second quarter 2025 are outlined in the following tables.
For three months ended June 30, For six months ended June 30,
----------------------
(In thousands of US
Dollars, except for
shares and per share
amounts) (Unaudited) 2025 2024 2025 2024
---------------------- --------------------------- --------------------------- --------------------------- ---------------------------
Revenue $ 251,979 $ 195,614 $ 598,386 $ 370,681
Cost of sales,
excluding
depreciation,
depletion and
amortization ("DDA") (164,902) (115,485) (372,694) (237,001)
---------------------- --------------------------- --------------------------- --------------------------- ---------------------------
Gross profit excluding
DDA(1) $ 87,077 $ 80,129 $ 225,692 $ 133,680
DDA (21,186) (12,358) (40,143) (23,460)
---------------------- --------------------------- --------------------------- --------------------------- ---------------------------
Gross profit $ 65,891 $ 67,771 $ 185,549 $ 110,220
General and
administrative
expenses $ (27,713) $ (15,240) $ (46,565) $ (29,401)
Exploration and
evaluation expenses (3,810) (3,054) (7,337) (7,884)
Loss on revaluation of
financial instruments
and embedded
derivatives (13,971) (2,099) (28,087) (3,882)
Other losses (18,621) (4,214) (17,493) (7,629)
---------------------- --------------------------- --------------------------- --------------------------- ---------------------------
Net earnings before
finance costs and
income tax $ 1,776 $ 43,164 $ 86,067 $ 61,424
Finance costs (2,764) (7,082) (8,074) (12,719)
---------------------- --------------------------- --------------------------- --------------------------- ---------------------------
Net (loss) earnings
before income tax (988) 36,082 77,993 48,705
---------------------- --------------------------- --------------------------- --------------------------- ---------------------------
Current income tax
expense $ (14,560) $ (18,894) $ (42,260) $ (27,380)
Deferred income tax
recovery (expense) 24 (769) (11,320) (5,748)
---------------------- --------------------------- --------------------------- --------------------------- ---------------------------
Net (loss) earnings $ (15,524) $ 16,419 $ 24,413 $ 15,577
---------------------- --------------------------- --------------------------- --------------------------- ---------------------------
(Loss)
earnings attributable
to:
Shareholders of the
Company $ (25,410) $ 8,298 $ (10,286) $ 2,613
Non-controlling
interests 9,886 8,121 34,699 12,964
---------------------- --------------------------- --------------------------- --------------------------- ---------------------------
Net (loss) earnings
for the period $ (15,524) $ 16,419 $ 24,413 $ 15,577
---------------------- --------------------------- --------------------------- --------------------------- ---------------------------
Net (loss) earnings
per share attributable
to shareholders of the
Company
Basic $ (0.22) $ 0.10 $ (0.09) $ 0.03
Diluted $ (0.22) $ 0.09 $ (0.09) $ 0.03
---------------------- --------------------------- --------------------------- --------------------------- ---------------------------
For three months ended June 30, For six months ended June 30,
----------------
(In thousands of
US Dollars,
except per share
amounts) 2025 2024 2025 2024
---------------- --------------------------- ---------------------------- --------------------------- ---------------------------
Net (Loss)
Earnings
attributable to
Shareholders of
the Company $ (25,410) $ 8,298 $ (10,286) $ 2,613
---------------- --------------------------- ---------------------------- --------------------------- ---------------------------
Net (Loss)
Earnings
attributable to
Shareholders of $ split
the Company per presentation to
Share $ (0.22) basic/diluted $ (0.09) $ 0.03
Loss on
revaluation of
financial
instrument 13,971 2,099 28,087 3,882
Depreciation of
Korali
share-based
payment for
permit 876 -- 4,756 --
Foreign
exchange 292 568 3,335 832
Share-based
expense 17,170 2,011 21,277 4,138
Other
Adjustments(*) 16,490 (3,148) 27,439 (1,066)
Tax adjustments (7,168) 1,805 (13,314) 2,159
---------------- --------------------------- ---------------------------- --------------------------- ---------------------------
Total increase
to Attributable
Net
Earnings(2) $ 41,631 $ 3,335 $ 71,580 $ 9,945
---------------- --------------------------- ---------------------------- --------------------------- ---------------------------
Total increase
to Attributable
Net Earnings(2)
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