Fortitude Gold Corp

Greetings. Welcome to the Fortitude Gold 2025 Third Quarter Conference Call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. Please note this conference is being recorded. I will now turn the conference over to your host, Mr. Jason Reed, CEO of Fortitude Gold. you may begin.

Thank you and good morning, everyone. Thanks for joining Fortitude Gold Corp's 2025 third quarter conference call. Following my brief comments and associated presentation for those who joined online, I have a brief question and answer period. Joining me on the call today for the Q&A portion will be Ms. Janet Turner, our Chief Financial Officer. Let me remind everyone, certain statements made on this call are not historical facts and are forward-looking statements. These statements are subject to numerous risks and uncertainties, as described in our annual report on Form 10-K and other SEC filings, which could cause our actual results to differ materially from those expressed in or implied by our comments. Forward-looking statements in this earnings release that we issued yesterday along with the comments on this call are made only as of today, November 5th, 2025, and we undertake no obligation to publicly update any of these forward-looking statements as actual events unfold. You can find a reconciliation of non-GAAP financial measures referred to in our remarks in our form 10-K filed with the SEC for the year ended December 31st, 2024. Second, excuse me, third quarter financial results and highlights include 4.7 million net sales, 0.2 million net income, or one cent per share, 11.7 million cash balance at September 30th, 2025, 1,384 gold ounces produced, 28.5 million working capital at September 30th, 2025, 2.5 million mine gross profit. 1.6 million exploration expenditures. 1,244 total cash cost after byproduct credits per ounce sold. 1,956 per ounce total all-in sustaining cost. 0.7 million dividends paid. 619 ounces of gold rounds or bullion at September 30th, 2025. Our Isabella Pro project, we continue to move waste from the pro-pit layback. We've begun to access the top of the mineralized gold zone trending southeast deep from the bottom of the pit. Due to the leach of our heat leach pad and the mineralization in the pro-pit, both areas are expected to provide the bridge, including our county line project, into production. We are pleased and excited to now have all our county line permits We thank the pro-business and pro-mining Trump administration that is working through the permit backlog. After the brutal four years in the Biden desert, we finally have all the necessary permits and the bonding is in place for our counterline project. We have begun drilling the water well and are planning for other infrastructure projects in the near term. We hit water and are pump testing and developing the well now. It's looking promising. that we have enough adequate water for the project. We are looking at the possibility of taking a few pieces of equipment over soon and mining some gold in historic pit as initial mining before the larger pit layback and waste removal. It's nice optionality to have, and we see and we will see if we ultimately use it. look to take advantage of this permit momentum and are pushing permits for Scarlet South. The government shutdown hasn't helped, but we feel we are closing in on a permit to mine that mineralization. In an ideal world, that permit would drop in soon, and we would take advantage of the mining equipment at Pearl and cycle the equipment back and forth between Scarlet and Pearl. If the Scarlet South permits take too long, we would then plan to move our focus to County Lines. But the possibility of mining Scarlet before County Line is attractive for numerous reasons, including efficiencies and extra runway to bring County Line online. We are pleased to announce we have brought our mining in-house and have leashed a brand new feed of Komatsu equipment. We'd like to thank our previous mine contractors for their work. With the near-term movement of equipment to various mines, it made more sense to bring the mining in-house. We received our power grid permit and await NV Energy to begin the power line installation. They have been on site and we are optimistic they will begin construction soon. We look forward to the energy cost savings by connecting to the power grid. We now have our heap leach expansion permit and look to acquire mine permits for North Scarlet and Golden Mile, as well as an exploration EA for East Camp Douglas. We target permitting as many projects as possible under the Trump administration so that we have numerous mines to build and operate for many years in the future. This would allow us to weather another four years in a Biden-equivalent desert if the next election cycle goes against the mining and business. With gold having reached record highs recently, I believe this pullback in the gold price is healthy as no market should go straight up. It's been my experience that pullbacks to fill in the market are important for the next leg higher. So while we are not at 4,300 gold highs today, we're rather closer to 4,000. And that is still a wonderful price to be selling gold at. Mainstream media is quick to tell you that the gold bull is over, and they may be right. But where was the mainstream media in giving us the heads up that the big bull move was coming in the first place? More signs point to a higher gold price after this pullback concludes. Continue to defensively position the company to overcome the challenges created by the Biden administration while targeting to offensively position the company to permit and build our next minds under the Trump administration. With that, I would like to thank everyone for their time today on this conference call. And, operator, if you could open up the lines if there are any Q&A.

Certainly. At this time, we will be conducting a question and answer session. If you would like to ask a question, please press star 1 on your telephone keypad. A confirmation tone will indicate your line is in the question queue. You may press star 2 if you would like to remove your question from the queue. For participants using speaker equipment, it may be necessary to pick up your handset before pressing the star keys. Once again, that is star 1 to ask a question. One moment, please, while we poll for questions.

Operator, while we wait for questions, if there are any live, I have quite a few written ones, so let's get to some of those first. The first one being from Ray Lieb. Question, now that permits are in hand for County Line, is there a production projection for the rest of 25 or 26? The answer to that is no, not yet. The second part of your question is AISC expected to remain around $1,956 per ounce. Answer to your question is no. That was a little high due to some capex. Yes, third part of your question, there was a large equipment purchase lease of 17 million on the cash flow. What is that? You heard me just mention that we decided to bring mining in-house. We've thought of this for a long time. It makes sense to do it now just because we're getting some permits. We expect to be at several locations. And it just made all the sense in the world to do that. Plus, we're in control of our own destiny, and we really like that. Another question, let's see, this again is from Ray Lieb. Is there any progress on permitting for exploring Scarlet North? Are there any other outstanding drill results awaiting access? I don't believe there are any outstanding results, but we are actively working to permit exploring Scarlet North. and ultimately, hopefully, producing Scarlet North. We've hit some pockets of mineralization up there, but as you guys recall, we were only given one NOI by the past administration, and we ended a gold program in ore, or in gold, a drill program, and we want to follow that up and define more. But we're actively working toward ultimately permitting Scarlet North. The more near term, as I mentioned in the conference call, would be Scarlet South. It makes all the sense in the world with all the equipment and Pearl Deep. If we can get that permit, hopefully before year end or early next year, we can cycle equipment back and forth. That would be really good if we can get that done. And mine sold its Scarlet South. Next question from William Shonshik. Sorry if I mispronounced your last name. How much money would the company save by paying Dividends quarterly. William, we wouldn't save a whole lot. That'd be nominal. I don't have the exact number, but we don't, we have the dividend kind of on autopilot to pay monthly, and it's really not a big deal. If anything, it's just a little more administrative. So, it would be nominal, any savings. Next question is from Richard Erickson. Has deep pit layback ore been collected and added to the LEAF PET yet? If not, how soon? Will this be done? We are at the top of it, and we're making an access to get to the final couple benches. And, yeah, then the probe will be done. But it's exciting that, you know, up until this point, this year we've been removing waste for the bulk of it, and now we are excited to get into the ore. But we're just about there, Richard. The next one again from Richard Erickson. How many tons of ore contained in the deep pit layback? And at what average grade? I've had this question before and we're not going to give our estimates. In large part, they weren't ever in a resource to remind everybody. We never expected to mine this. We needed to mine it to create the bridge when we couldn't get any permits under Biden. And the gold price allowed us to go deeper and remove all this waste. So while we know there's gold there, It's not in a form of resource. We have some internal numbers, but ultimately, it's not going to matter until we actually mine it. That's the ultimate sample. So, I don't have public numbers for you on that. Next question from Scott McCloud. In a perfect world, if scarlet came online, how many ounces do you think will be producing a month? I'm not going to speak to monthly yet, as every production, or even annual for that matter. As everybody knows, the Biden administration knocked us off our horse. We're trying to climb back on now that the Trump administration's back in. So, you know, as our presentation, corporate presentation stated for four years now, that we don't have an outlook as to be determined as a function of getting these permits. Let us get some, our feet under us. Let us get this mine up and running. Then we'll come out with some forecasts. But until then, Yeah, we're just chopped that up to be knocked off our horse by the time mining administration. Craig Hooper. Good morning, Jason. Can you provide some details on how you manage the throughput of the expected recoverable ounces on the pad in 2025 and going forward into 2026? What determines the ounces coming off the pad each quarter, time under leach, or is it based on pad capacity? All good questions. PAD is almost like a living entity of its own. You have multiple levels. You have the, let's just call them a checkerboard of cells that you're putting each cell under leach under various times. It's good to pull them off of leach and then put them back on. So it's very complicated. But we manage it as a function of just operations. General manager has a handle on you know, what we think we need to put under leach at what time and put back on the leach. But now pads are very complicated. The long and short of it is we're still pulling residual leach, which is good. I hope that gets the most to your question. Another question by Terry Van Den Boe. Apologies if I mispronounce that. What do you expect to produce at Isabella Pearl in the coming quarters? Again, I'm not going to speak to any production estimates as a function of, you know, we just got our permit for County Line. We're working on Scarlett. Let us get our feet under us, and then we'll come out with projections. Operator, are there any live questions that we should get to?

You do have a question coming from John Bear with Ascend Wealth Advisors.

Thank you. Good morning, Jason.

Good morning, John. How are you?

Good, good, good. Glad to see things starting to fall into place here. So I've got a couple of questions. Number one, when might you or will you make any kind of a press release as to – once you decide and determine when you think County Line might be – Up and running. Do you anticipate putting out any kind of news release as to, you know, construction beginning and so forth?

Yeah, that's a high likelihood. As the comments, and I'll just reiterate them here, but as the comments in the call, we had hoped that we were going to get Scarlet South permits. In an ideal world, that really helps the mining. Let me explain a little bit why that is. As we go deeper in the Pearl, the space available is very limited. When you're trying to do your blast haul cycles, you have a lot of downtime with equipment up top. It'd be great if you can bounce back and forth and do each of those cycles equally at Scarlet, South, and the Pearl. That's That would be ideal. We thought we're on the cusp of getting that and then the government shut down. So man, you talk about weathering four years of Biden and then the government shuts down. But hopefully they get back up and running and hopefully we get that permit. If that doesn't happen in time, when we're done with the Pearl, then we're going to go over to County Line with full force. We, as I mentioned, we already started drilling the well. We're doing some road infrastructure, et cetera, and preparing for that. But because that's in flux, let us get a little clarity and then, you know, likely permit that we're, or excuse me, PR that we're officially, quote, unquote, starting on County Line.

Okay. So real activity on County Line doesn't get started until these other two fall into place. Is that correct?

Yeah, well, it could start right at the end of Earlville if Scarlet South doesn't fall into place. You know, we try to bake in a lot of optionality. You guys have always heard me say we have Plan A, but Plan A rarely works. You've got to have B, C, D, and E. So we have all this optionality. Plan A is Scarlet South. That would be wonderful just as an efficiency in moving equipment back and forth because it's only about 500 meters away. All right. You know, I would have loved to have had that answer. If the shutdown wouldn't have happened, I might have had that answer. But at this point, with the shutdown, let's wait until that stops and see when we get the permit. And if it doesn't come in, let's try this out. Soon enough, we'll just move everything over to County Line and hit that hard. But, yeah, you should expect some sort of press release in that regard.

Okay. Very good. Second question, how long are the lease, the equipment obligation? Is that an actual outright purchase or a lease purchase, and how long is that? What's the duration of all that?

Yeah, it's a lease, and they're all short-term, and the reason being is kind of like what we do with a lot of our light rolling stocker trucks, smaller trucks like Ford F-250s, etc., We lease them short-term, and then the owner, which in this case is Komatsu, doesn't want it to go up certain hours, over certain hours, and then they come and get it, switch it out. So we're doing a similar thing with this heavy equipment. So it's all short-term lease. The way we view this is that the mining contractors were doing the same thing, but then obviously they upcharge us. because they're doing it. And then, you know, the delta that they were making working for us, now that it's under our umbrella, we hope to keep. So it makes a lot of sense to do this. And if everything works as even half as what we planned, you know, we should see some benefit, both in directing our own future, not having to babysit as much, et cetera, but more importantly, you know, holding on to some of that delta that they were making. It just makes all the sense in the world. Also, we're going to be moving equipment a lot of places, and it's not uncommon when you do that with groups that own equipment that they get you for MOB and DMOB charges and use that as a means to renegotiate, and we're not going to have to address any of that because we brought it all in-house. basically hired the same team of people because they're local, and now they work for us. So, I mean, it's just – it's something we always envisioned doing. It's just a lot to do early on, but now it just makes all the sense. We have – you know, if we get Scarlet South, we're going to have multiple mines. We're going to have multiple locations. It makes a lot of sense to do.

Yeah. No, I agree. That sounds interesting. Last question. Do you have any active drilling going on, exploratory type – There was some modest expense in this most recent quarter. And if you do, where are you doing it at?

No, anything you see under expense line item is not drilling for the most part. Yeah, we're not doing anything. I thought there was like a million seven in exploration. Maybe I misread that. No, no. You didn't misread it, but a lot of exploration costs aren't just drilling. Just when you see an exploration cost, it doesn't mean just drilling. We have an exploration team. They're out doing a lot of mapping. They're doing other studies. They're doing other things. We don't have an extensive exploration program by any means. We just don't, in large part. We've been knocked off a horse. We've cut back on things trying to weather and get these other mines up and running. So, no, we have not flipped the switch to go back to exploration drilling yet. Okay, so no drills.

Yeah, no active drilling going on, no active drilling. Do you have any assays that are out there that you're waiting on results for?

We had that two tranches of assays that were stuck in a lab for a long time and came back from long drilling quite a while ago. I don't believe we have any more. What was wonderful about those assays, and they all had to do with county line for anybody listening that didn't see that, county line has two pits and that drilling told us that there's expansion potential not only in the pits but south of the east pit for sure. This is an area that Hasn't been mined before. Also very exciting over there, one of our best targets, LRVP of Exploration tells us, is this hill or knoll that's north of the county line, Big Pit, that's never been drilled. And structurally, that's the biggest target. So, you know, between those drill assays that point to additional gold ounces, and that's one of the reasons why we mentioned and have mentioned, I'll mention again, that we're looking to possibly update that resource because we think we added ounces over there. They're working on that right now. They're working on that county line one. So, you know, county line, you know, has a lot of upside as well, which is great. But, no, we have not gone back to any exploration in a material way for new areas.

Okay. Very good. Appreciate answering the questions, and good luck. Keep going.

Hey, thanks. Good to talk to you, John. Yep. Operator, if there's another call, we'll take it live. Otherwise, there's a couple more write-in questions.

There are no questions in queue. If you would like to ask a question, please press star 1.

Okay. has another question. Can we expect to see the dividend back at 4 cents per month or possibly much higher as the gold price is now much higher compared to a year ago? Great question. You know, we'd love to go back to that. That's not going to happen in the near future in any form or fashion. Again, I think if you haven't heard it, you're going to hear from me again. We're trying to get back on the horse, having been knocked off by the Biden administration. So, you know, let us get that done before we do that. I mean, right now, we're tightening our belt. You heard me talk about not exploring. We're not doing all these other things. We're still paying a nominal dividend. So... You know, one could argue, should you even be paying a dividend right now when you're trying to keep your belt as tight as possible? We're trying to walk that fine line. And so, yeah, in an ideal world, we love to go back to the dividends of old. But right now, we need to take our capital and focus on getting back on the horse fully. So that's what we're going to do. So, no, don't expect dividend increases in the near future. And we don't tie it to the gold price. It's not a function of the gold price. it depends on what you're doing. You know, we're about to build mines. That takes some money, even though the mines we're going to build are inexpensive in as much as the hub and spoke that we're trying to do where we don't build everything at each facility. We're trying to just direct ship or and such. It'll be some of the cheapest capexes for a mine in the industry, but it's still capex. So we got to keep our belt tightened and, So hopefully that gets to your question. Ray Lee came back with another question. Is there any progress getting electrical power to the site? Not a lot, Ray. They have come out. There was a little bit of issue on their end with a couple groups talking to each other on their end, not us. We think they have that sorted, and we are just itching to hear a construction start date. I think that's the best update I can give you. I would have liked to have had the line done by now. But as you guys will fully know that have been following us, we've been trying to get this power line for over five years. And we got nowhere during the Biden administration. So Trump gets in and all of a sudden this just popped out of the blue. We kind of, I don't want to say given up, but we just quit pushing on him because we're getting nowhere. And all of a sudden we get, boom, Trump's in and boom, this drops in. So I credit his administration with that and his Department of Energy with pushing projects. And we're part of that, I think. And, you know, it's at least it's moving. But, you know, it takes a while when you've gone from a standstill to a walk or a run. And that's, I think, what's happening with the power line. But at least it's moving. So that's good news because we will save on energy costs when we get hooked to the power grid, which will be wonderful. And it also might free up at least one of our diesel generators to take to our satellite deposits, if you will. So a lot of good things come of that. Okay, probably the last question we'll do today because it's running a little long. So let's make this our last question from Tom Sturick. Does the launch – does the leach pad at Isabella Pearl have enough capacity for expected increases in mining activity? Great question, Tom. It does for the foreseeable future and a very large percentage of county line will be able to be put on that as well as all of Scarlet South. But when you combine them both, we're getting toward the max. So we will be expanding the heap pad at some point in the future. We're actively gearing up for that. And yeah, but... We're not in a race right now. We're not going to be out of space, and we fully expect to have the expansion complete before we need it, I guess is probably the cleanest way to answer that. Okay, that went much longer than I thought, so let's go ahead and conclude. If you were either in the queue on the live or I didn't get to your question, please call back. Probably just call Greg. He's available. I am traveling right now, so less available, but if you can get me on my cell, great. But call us if you have any questions at any time. Apologies if we didn't get to your question, but we're always available. So very good. With that, I'd like to conclude the call, and we'll talk to you guys next quarter. Thank you.

This concludes today's conference, and you may disconnect your lines at this time. Thank you for your participation.

Holly, thank you for your time.