Silver Producers Revenue Jumps 149% as Mine Cash Flow Surges 336%

Endeavour Silver Corp. (EDR:TSX; EXK:NYSE; EJD:FSE) reported higher production, revenue, and mine operating cash flow for the second quarter of 2026, alongside increased throughput at Kolpa and continued ramp-up activity at Terronera.

For the three months ended June 30, consolidated production totaled 1,943,955 ounces of silver and 10,474 ounces of gold, increases of 31% and 35%, respectively, from the same period in 2025. Silver equivalent production totaled 3.4 million ounces. The company processed 509,576 tonnes during the quarter, up 68% from 303,828 tonnes a year earlier.

Endeavour generated US$212.1 million in revenue from operations, a 149% increase from US$85.3 million in Q2 2025. The company sold 2,054,108 ounces of silver and 10,823 ounces of gold at average realized prices of US$70.16 per ounce of silver and US$4,305 per ounce of gold, along with sales of base metals.

Mine operating earnings increased to US$74.0 million from US$7.7 million in the year-earlier quarter, while mine operating cash flow before taxes rose 336% to US$99.9 million. Operating cash flow before working capital changes was US$45.0 million, compared with US$14.4 million in Q2 2025.

The company reported net earnings of US$66.5 million, compared with a net loss of US$20.5 million a year earlier. Adjusted net earnings were US$44.8 million, compared with an adjusted net loss of US$9.2 million. Basic earnings per share were US$0.22, and adjusted basic earnings per share were US$0.15.

Endeavour recorded US$110.9 million in EBITDA and US$90.0 million in adjusted EBITDA during the quarter. As of June 30, the company held US$236.6 million in cash and US$214.4 million in working capital.

“Endeavour delivered strong second quarter results, supported by higher production, record ounces sold and improved mine operating cash flow,” Chief Executive Officer Dan Dickson said in a company news release. “The successful increase in throughput at Kolpa and our strong cash position provide a solid foundation as we continue to advance our growth initiatives in the second half of the year, while delivering long-term value for our shareholders.”

Consolidated cash costs were US$23.52 per payable silver ounce, net of by-product credits, compared with US$15.35 in Q2 2025. The company attributed the increase mainly to higher metal prices, resulting in higher royalties and third-party material costs. All-in sustaining costs were US$36.89 per silver ounce, compared with US$25.16 a year earlier, primarily reflecting higher cash costs and increased sustaining capital expenditures, particularly at Terronera.

Direct operating costs were US$161.73 per tonne, 14% above US$142.00 in Q2 2025. The company said the increase reflected the inclusion of Terronera, as well as higher costs at Guanaceví and Kolpa. Costs in Mexico were also negatively affected by the Mexican peso being 12% stronger on average than during the comparable period. Compared with Q1 2026, direct operating costs per tonne decreased 13%.

Kolpa recorded increased throughput following the commissioning of a significant portion of its plant expansion at the end of Q1. Throughput increased 36% in Q2 compared with the preceding quarter. The operation processed 233,408 tonnes during Q2 and produced 1,184,457 silver-equivalent ounces.

At Terronera, the LNG plant began commissioning in June and was in operation at the time of the company’s July corporate presentation, with mine complex ramp-up continuing through Q3. Terronera processed 175,729 tonnes during the quarter and produced 1,298,268 silver equivalent ounces.

For the first six months of 2026, Endeavour produced 3,819,329 ounces of silver and 22,215 ounces of gold, increases of 42% and 38%, respectively, from the comparable 2025 period. Revenue from operations totaled US$421.8 million, while net earnings were US$131.4 million, and mine operating cash flow before taxes totaled US$214.5 million.

Analysts Maintained Buy Rating as Production Growth and Operational Progress Remained in Focus

H.C. Wainwright analysts Heiko F. Ihle, CFA, and Case Bongirne reiterated their Buy rating and US$17.00 price target on Endeavour Silver in a July 30 earnings update following the company’s second-quarter financial results. The analysts said the quarter “further displays the favorable impact of Kolpa and the progress made at Terronera,” pointing to US$212.1 million in revenue, US$66.5 million in net income, and US$74.0 million in mine operating earnings. They also noted that silver revenue had increased to US$144.1 million from US$48.9 million as the company’s realized silver price rose to US$70.16 per ounce from US$32.95 per ounce.

Ihle and Bongirne said Endeavour’s reported all-in sustaining costs of US$36.89 per ounce “significantly misrepresent the firm’s cost structure.” Excluding Guanaceví, they calculated that Terronera and Kolpa operated at a blended US$27.93 per ounce, US$8.96 per ounce below the consolidated figure. They noted Terronera’s cash costs of US$5.07 per ounce and AISC of US$26.42 per ounce, while Guanaceví accounted for US$36.1 million of Endeavour’s US$69.1 million in AISC spending and approximately 28% of total silver equivalent production. The analysts expected AISC to decline during the second half as Terronera reached its full run rate following LNG plant commissioning and Kolpa’s expanded plant contributed at higher throughput rates.

Capital allocation also remained a focus of the report. The analysts noted that growth capital spending had declined to US$8.9 million in the second quarter from US$45.4 million a year earlier, while first-half growth capital declined to US$14.7 million from US$81.6 million. Sustaining capital increased to US$37.0 million from US$14.2 million as Terronera transitioned into operation. With US$236.6 million in cash and US$214.4 million in working capital, Ihle and Bongirne wrote, “We view the next stage of growth to come from how the balance sheet is deployed.” They anticipated future spending would focus on Pitarrilla and mergers and acquisitions, while expecting Kolpa to maintain higher throughput rates and Terronera to complete its ramp-up process in the near term.

For valuation, H.C. Wainwright maintained discount rates of 7.0% for Guanaceví, 9.0% for Terronera, and 10.0% for Minera Kolpa. The analysts added US$307.9 million in cash and finished inventories and subtracted US$243.9 million in debt, resulting in a net asset value of US$2.51 billion, or US$8.49 per share. Applying an unchanged 2.0x NAV multiple produced the firm’s US$17.00 price target. The report modeled 2026 diluted earnings per share of US$0.69 and revenue of US$774.2 million.

The analysts also identified grade improvements at Terronera, throughput growth at Kolpa, and the Pitarrilla feasibility study among the near-term catalysts. They wrote that Endeavour’s “near-term operational and technical catalysts in the current commodity price environment appear to position the firm for a meaningful re-rating in 2H26.” H.C. Wainwright listed commodity price risk, financing risk, increased capital to construct Terronera, and operating and technical risk among the risks to its outlook.

On July 31, Chen Lin of the What Is Chen Buying? What Is Chen Selling? Newsletter commented on Endeavour following its earnings, writing, “EXK [is] . . . down on weak earning[s].” Lin also said, “I will be watching . . . and looking for buying opportunities.”

Production, Ramp-Up, and Project Work Define 2026 Milestones

Endeavour’s July corporate presentation outlined consolidated 2026 production guidance of 8.3 million to 8.9 million ounces of silver and 46,000 to 48,000 ounces of gold, along with 22,000 to 24,000 tonnes of lead, 16,000 to 18,000 tonnes of zinc, and 650 to 750 tonnes of copper. Total silver equivalent production guidance was 14.6 million to 15.6 million ounces. Consolidated cash cost guidance, net of by-product credits, was US$12.00 to US$13.00 per silver ounce, with AISC guidance of US$27.00 to US$28.00 per ounce. Sustaining capital was listed at US$91.0 million.

At Terronera, 2026 guidance included 2.4 million to 2.6 million ounces of silver and 35,000 to 36,000 ounces of gold, representing 5.6 million to 5.8 million silver equivalent ounces. Sustaining capital was listed at US$56.7 million. The presentation stated that silver grades were in line with the plan and were expected to increase during the second half as mining operations accessed higher-grade areas. The LNG plant was in operation following the start of commissioning in June, with mine complex ramp-up continuing through Q3 2026. Exploration drilling had also restarted, marking the first drill program at Terronera since 2020.

Terronera encompasses 25 concessions totaling approximately 20,000 hectares, with more than 50 mines on more than 50 known veins. The presentation stated that the Terronera vein contains more than 90% of the defined reserve and that its inferred envelope remains open along strike and at depth. The La Luz vein was described as almost entirely high grade and relatively shallow for access, with plans to mine it early in the project.

At Kolpa, 2026 guidance called for 2.3 million to 2.5 million ounces of silver, 22,000 to 24,000 tonnes of lead, 16,000 to 18,000 tonnes of zinc, and 650 to 750 tonnes of copper, equivalent to 4.4 million to 4.9 million silver equivalent ounces. Sustaining capital was listed at US$9.8 million. The operation had expansion plans to reach 2,500 tonnes per day, and a significant portion of that plant expansion was commissioned in Q1 2026. The presentation also identified opportunities to further define and potentially expand recent near-mine exploration discoveries and make new discoveries across the land package.

Guanaceví’s 2026 guidance included 3.6 million to 3.8 million ounces of silver and 11,000 to 12,000 ounces of gold, equivalent to 4.6 million to 4.9 million silver equivalent ounces. Sustaining capital was listed at US$24.5 million. [OWNERSHIP_CHART-220]

Pitarrilla represented another work program outlined for 2026. The presentation listed an estimated US$15 million for a feasibility study, US$2.8 million for exploration work that included 8,550 meters of drilling, and US$48.0 million of capital spending. The feasibility study was expected in Q3 2026. The presentation also stated that the project has road access, connections to the power grid and a water source, exploration and contractor camps, access to utilities and a workforce, as well as permits covering water use and discharge, general use of explosives, and change of soil. Underground mining and development had been approved through an Environmental Impact Statement, and collaboration agreements with the local community were in place.