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The call conveyed a strongly positive operational and financial quarter with multiple records (revenue, adjusted EBITDA, adjusted earnings), industry-leading cost metrics, significant free cash flow generation, a strengthened balance sheet, and clear multi-year growth catalysts (Copper World, Cactus, Mason, New Ingerbelle). Challenges highlighted—grade variability, localized labor and equipment constraints, external cost pressures (fuel, labor), permitting/legal timing and remaining CapEx uncertainty—were presented as manageable and being actively mitigated. Overall, the positive operational results, robust liquidity position (despite a post-quarter reduction), strategic partnership funding, and tangible production growth outlook materially outweigh the identified near-term risks.
Management said the company is on track to meet 2026 production and cost guidance after a Q1 that delivered record revenue of $757 million, adjusted EBITDA of $422 million, adjusted net earnings of $159 million ($0.40/sh), cash from operations of $211 million and Q1 free cash flow of $102 million (TTM free cash flow $400 million); Q1 production was 28 kt copper and 62 koz gold (Peru: 21 kt Cu, 9 koz Au, 530 koz Ag, 380 t Mo; Manitoba: 48 koz Au, 2.5 kt Cu, 5 kt Zn, 213 koz Ag; Copper Mountain: 4.1 kt Cu, 5.2 koz Au, 43 koz Ag), consolidated cash costs were a record negative $1.80/lb (sustaining cash costs $0), Peru cash costs $0.70/lb, B.C. $2.41/lb and Manitoba gold cash costs $4.08/oz; the balance sheet was strengthened with >$1.0 billion cash, $1.4 billion total liquidity at March 31 (net debt ~0, net debt/EBITDA at decade-low, post-note repayment liquidity $957 million), and management reiterated the growth outlook—consolidated copper to average ~147 ktpa over the next three years (+24% vs 2025), consolidated gold ~243 kozpa, Copper World DFS >85% (DFS mid‑2026, FID later this year, rock‑in‑the‑box ~mid‑2029) with a $420 million initial JV contribution from Mitsubishi, Mason PFS targeted for 2027 with ~$20 million budgeted in 2026, New Ingerbelle permits received and expected to raise gold from ~20 kozpa to ~40 kozpa with ~10 years of reserves starting ~2028, and a pathway to ~250 ktpa by decade‑end and ~500 ktpa by mid‑next decade.
Record revenue of $757 million, record adjusted EBITDA of $422 million, and record adjusted net earnings of $159 million ($0.40 per share) in Q1 2026, driven by higher realized metal prices and margin expansion.
Consolidated Q1 production: 28 thousand tonnes of copper and 62 thousand ounces of gold, with higher mill throughput across operations versus the prior quarter.
Record low consolidated cash costs of negative $1.80 per pound of copper and sustaining cash costs of $0, helped by higher gold byproduct credits; Peru cash costs of $0.70/lb (Q1) and British Columbia cash costs of $2.41/lb (Q1).
Generated $102 million of free cash flow in Q1 after sustaining capex (TTM free cash flow $400 million); ended Q1 with over $1 billion in cash and cash equivalents and total liquidity of $1.4 billion as of March 31.
Net debt nearly zero and net debt-to-EBITDA at the lowest point in more than a decade; repaid 2026 senior notes on April 1 while maintaining significant liquidity.
Received $420 million initial cash contribution from Mitsubishi for the Copper World joint venture to fund pre-sanctioning and initial project development costs.
Extended mine lives: Snow Lake to 2041 (+4 years), Constancia to 2040, Copper Mountain to 2045 (+2 years); consolidated copper production expected to average 147 thousand tonnes/year over next three years, a 24% increase from 2025; consolidated gold expected to average 243 thousand ounces/year.
Peru mill throughput achieved a new quarterly record (~90.7 ktpd) and permit approved to increase annual throughput to 31.1 million tons; Copper Mountain reached record material movement (>25 million tonnes) and second SAG mill averaged ~10 ktpd in March; Manitoba New Britannia mill gold recoveries improved to 90%.
Received amended Mines Act and Environmental Management Act permits for New Ingerbelle (B.C.) and project added to B.C. priority resource list; Copper World DFS >85% complete (on track for mid-2026) and acquisition of Arizona Sonoran (Cactus) advancing U.S. growth pipeline.
Management forecasts ~70% increase in annual copper production by decade end (~250 kt) with Copper World and a pathway to ~500 kt by mid-next decade through staged development of Copper World, Cactus and Mason.
Good morning, ladies and gentlemen. Thank you for standing by. Welcome to the Hudbay Minerals Inc. First Quarter 2026 Results Conference Call. At this time, all participants are in a listen-only mode. Following the presentation, we will conduct a question-and-answer session. I would like to remind everyone that this conference call is being recorded on 05/01/2026, 11:00 AM Eastern Time. I would now like to turn the conference over to Candace Brule, Senior Vice President, Capital Markets and Corporate Affairs.
Please go ahead.
Thank you, operator. Good morning, and welcome to Hudbay Minerals Inc.'s First Quarter 2026 Results Conference Call. Hudbay's financial results were issued this morning and are available on our site at www.hudbay.com. A corresponding PowerPoint presentation is available in the Investor Events section of our website, and we encourage you to refer to it during this call. Our presenter today is Peter Gerald Kukielski, Hudbay's President and Chief Executive Officer. Accompanying Peter for the Q&A portion of the call will be Eugene Lei, our Chief Financial Officer, and Andre Lauzon, our Chief Operating Officer. Please note that comments made on today's call may contain forward-looking information and this information, by nature, is subject to risks and uncertainties, and as such, actual results may differ materially from the views expressed today. For further information on these risks and uncertainties, please consult the company's relevant filings on SEDAR+ and EDGAR.
These documents are also available on our website. As a reminder, all amounts discussed ...