Cerro de Pasco Resources Delivers Strong Turnaround with $24.6M Net Income Following Strategic Asset Sale

• Cerro de Pasco Resources achieved a remarkable financial turnaround with net income of $24.6 million for fiscal 2025, compared to a $29.3 million loss in the prior period.
• The company strengthened its balance sheet significantly through the strategic sale of the Santander mine, generating $35.9 million in gains and eliminating over $70 million in liabilities.
• CDPR improved its cash position to $11.5 million and achieved positive working capital of $6.3 million, reversing a $55.0 million deficit from the previous period.
• The company secured critical advancement agreements for its flagship Quiulacocha Tailings Project, including an easement agreement and completion of a 40-hole drilling program.
• Post-year-end warrant and option exercises generated approximately CAD $4.1 million in additional proceeds, further strengthening the company's financial position.

Cerro de Pasco Resources Inc. (CSE: CDPR) (OTCMKTS: GPPRF) (BVL: CDPR) is a Canadian mining company focused on developing the world-class Quiulacocha Tailings Project in Peru's mineral-rich Cerro de Pasco region. The company specializes in tailings reprocessing and environmental remediation, positioning itself at the intersection of resource extraction and sustainable mining practices. Following a strategic restructuring completed in fiscal 2025, CDPR has transformed from a financially distressed multi-asset operation into a well-capitalized, focused development company with a clear path toward advancing its flagship project.

The fiscal year ending March 31, 2025, represents a pivotal period for Cerro de Pasco Resources, marked by significant strategic realignment and financial restructuring that has fundamentally altered the company's trajectory. The successful divestiture of non-core assets and subsequent focus on the Quiulacocha project positions CDPR as an attractive proposition for investors seeking exposure to Peru's mining sector through a company with improved financial stability and clear development objectives.

Financial Performance & Strategic Transformation

Cerro de Pasco Resources delivered exceptional financial results for fiscal 2025, achieving net income of $24.6 million compared to a net loss of $29.3 million in the fifteen-month period ended March 31, 2024. This represents a remarkable $53.9 million positive swing in financial performance, driven primarily by strategic asset optimization and operational restructuring.

The company's earnings per share improved significantly to $0.06 on both basic and diluted bases, reversing from a loss of $0.09 per share in the prior period. This improvement reflects not only the absolute improvement in financial performance but also demonstrates the company's ability to generate positive returns for shareholders following its strategic repositioning.

CEO Guy Goulet emphasized the significance of this transformation, stating: "The past year marks a turning point for Cerro de Pasco Resources. With the sale of the Santander mine, we have removed significant liabilities from our balance sheet and sharpened our strategic focus on advancing our world-class Quiulacocha Tailings Project. The Company is now well-capitalized and strongly positioned to execute on the next phase of development."

Balance Sheet Strengthening & Liquidity Improvement

The most striking aspect of CDPR's financial transformation lies in its dramatically improved balance sheet position. The company's cash balance increased substantially to $11.5 million from just $0.1 million in the prior period, representing a more than 100-fold improvement in liquidity position. This enhanced cash position provides the company with the financial flexibility necessary to advance its development activities without immediate capital constraints.

Working capital position experienced an even more dramatic improvement, moving from a deficit of $55.0 million to positive working capital of $6.3 million, representing a $61.3 million improvement. This transformation eliminates the immediate financial pressures that previously constrained the company's operational capabilities and provides a stable foundation for future growth initiatives.

The company's shareholders' equity position also underwent a complete reversal, improving from a deficit of $40.8 million to positive equity of $6.7 million. This $47.5 million improvement in shareholders' equity reflects the underlying value creation achieved through the strategic restructuring process and positions the company favorably for future financing activities if required.

Strategic Asset Divestiture & Operational Focus

The cornerstone of CDPR's strategic transformation was the completed sale of its Santander mine operations in August 2024. This transaction generated a substantial gain of $35.9 million while simultaneously eliminating over $70 million in associated liabilities from the company's balance sheet. The divestiture represents a strategic decision to focus resources and management attention on the higher-potential Quiulacocha project while removing operational complexities and financial burdens.

Total liabilities decreased dramatically from $78.2 million to $9.6 million, representing an 87.7% reduction in the company's debt burden. This liability reduction included the full settlement of convertible debentures and promissory notes, eliminating potential dilutive instruments and simplifying the company's capital structure.

The strategic rationale behind this divestiture extends beyond immediate financial benefits. By concentrating resources on a single, world-class asset, CDPR can optimize its technical, financial, and management resources toward advancing the Quiulacocha project through critical development milestones.

Capital Raising & Shareholder Alignment

Beyond asset sales, CDPR successfully raised over $17 million through private placement activities during fiscal 2025, demonstrating continued investor confidence in the company's strategic direction. These capital raising activities were complemented by warrant and option exercises, indicating strong shareholder alignment with the company's long-term prospects.

The success of these financing activities reflects the market's positive reception of CDPR's strategic repositioning and provides validation of the company's focused approach to asset development. The combination of asset sale proceeds and new capital provides CDPR with the financial resources necessary to advance the Quiulacocha project through its next development phases.

Quiulacocha Project Advancement

CDPR achieved significant operational milestones at the Quiulacocha Tailings Project during fiscal 2025, establishing the foundation for accelerated development activities. In May 2024, the company executed an easement agreement with Activos Mineros S.A.C., providing essential access rights for engineering activities and exploration programs.

This easement agreement enabled the completion of a comprehensive 40-hole drilling program at Quiulacocha, supported by a $1 million payment to the Peruvian National Bank. The drilling program represents a critical step in advancing the technical understanding of the deposit and supporting future feasibility studies and development planning.

The successful negotiation and execution of this easement agreement demonstrates CDPR's ability to navigate the complex regulatory and stakeholder environment in Peru while advancing its development objectives. The agreement provides long-term certainty regarding access rights, removing a potential obstacle to future development activities.

Technical & Environmental Development Activities

CDPR is actively pursuing technical, environmental, and permitting activities at Quiulacocha with the objective of delivering a Preliminary Feasibility Study (PFS). The PFS represents a critical milestone that will provide detailed technical and economic analysis of the project's development potential and serve as the foundation for future financing and development decisions.

The company's focus on environmental aspects reflects both regulatory requirements and the unique nature of the Quiulacocha project, which combines resource extraction with environmental remediation objectives. This dual focus positions CDPR to potentially benefit from both commodity revenues and environmental credits or incentives.

Post-Year-End Developments & Future Outlook

Following the completion of fiscal 2025, CDPR continued to benefit from strong shareholder support through warrant and option exercises. Between April and July 2025, 17,009,580 warrants and 400,000 stock options were exercised, generating approximately CAD $4.1 million in additional proceeds.

These post-year-end developments further strengthen CDPR's already improved financial position and demonstrate continued shareholder confidence in the company's strategic direction. The substantial warrant exercise activity suggests that shareholders view the current strategic positioning favorably and expect continued value creation.

Development Milestone Focus

CDPR's immediate focus centers on advancing the Quiulacocha project toward key development milestones, particularly the completion of the Preliminary Feasibility Study. The PFS will provide critical technical and economic data necessary for future development decisions and potential financing activities.

The company's strengthened financial position provides the resources necessary to complete these critical studies without immediate capital constraints, positioning CDPR to potentially advance toward construction and production phases more rapidly than would have been possible under its previous capital structure.

Investment Considerations & Risk Factors

Strengths & Opportunities

CDPR's transformation presents several compelling investment attributes. The company's dramatically improved financial position eliminates immediate liquidity concerns and provides operational flexibility. The focused strategy on a single, world-class asset allows for optimized resource allocation and management attention.

The Quiulacocha project's location in Peru's established mining region provides access to existing infrastructure and skilled labor markets. The project's tailings reprocessing nature potentially offers lower capital requirements compared to traditional greenfield mining projects while providing environmental benefits that may attract ESG-focused investment capital.

Risk Assessment

Despite the positive transformation, investors should consider several risk factors. CDPR remains a development-stage company with no current production revenue, making it dependent on continued access to capital markets for development funding. The company's operations are concentrated in Peru, exposing it to country-specific political and regulatory risks.

Commodity price volatility could impact the economic viability of the Quiulacocha project, particularly given the multi-metal nature of the deposit. Environmental and permitting risks remain inherent in mining development projects, particularly those involving tailings reprocessing.

For Investors

Cerro de Pasco Resources has successfully executed a comprehensive strategic and financial transformation that positions the company as an attractive development-stage mining investment. The elimination of over $70 million in liabilities, achievement of positive working capital, and focus on a single world-class asset represent fundamental improvements in the company's investment profile.

The company's strengthened balance sheet, with $11.5 million in cash and positive working capital of $6.3 million, provides the financial stability necessary to advance the Quiulacocha project through critical development milestones. The successful completion of key agreements and drilling programs demonstrates operational progress toward the Preliminary Feasibility Study completion.

For investors seeking exposure to Peru's mining sector through a financially stable, focused development company, CDPR presents a compelling proposition. The company's transformation from a financially distressed multi-asset operation to a well-capitalized, single-asset developer represents a significant de-risking of the investment while maintaining upside potential from the world-class Quiulacocha project. The post-year-end warrant exercises and continued shareholder support provide additional validation of the strategic direction and suggest positive momentum heading into the next phase of development.