New Found Gold: Hammerdown Mine Profitability & the C$220.05M Finance Package

• Hammerdown generated C$1,436,229 in mine operations income in the first quarter of 2026, its inaugural revenue-producing quarter, established following New Found Gold's acquisition of Maritime Resources in November 2025.
• The Exploration and Evaluation segment spent C$12,554,884 in the first quarter of 2026, with C$12,259,482 attributable to Queensway and drilling the largest single cost category at C$4,012,279, against a full-year programme targeting 90,000 metres of drilling on a fully funded C$44 million budget.
• New Found Gold assembled a C$220.05 million Finance Package comprising a C$105 million senior secured credit facility from EdgePoint Investment Group Inc. and a C$115.05 million bought-deal equity raise. The equity raise closed on April 27, 2026, with the C$70 million Tranche 1 drawdown completing in May 2026, and the Company strengthened its long-term anchor investor base, with cornerstone investor Eric Sprott among those participating.
• The Finance Package delivers C$185 million in fresh capital, comprising C$115 million in equity proceeds and the C$70 million Tranche 1 draw, with the Company's post-financing cash and marketable securities standing at C$148 million.
• At full build-out in Phase 2 of Queensway, the combined Hammerdown and Queensway platform targets approximately 191,000 ounces of annual gold production, with combined projected free cash flow exceeding $300 million at current gold prices.

New Found Gold (TSXV: NFG | NYSE American: NFGC) reported its first-quarter 2026 financial results in May 2026, and the two-segment structure they contain tells a precise capital story. Hammerdown, the gold mine established through the November 2025 acquisition of Maritime Resources, recorded positive mine operations income in its inaugural revenue-generating quarter. The Exploration and Evaluation segment consumed C$12,554,884 in the same 90-day period, with C$12,259,482 attributable to the Queensway property. While Hammerdown successfully established its first operating surplus, its first-quarter mine-level income of C$1,436,229 highlights the scale of capital required to run Queensway's exploration in parallel. To support this capital demand, the Company closed the C$220.05 million Finance Package shortly after the end of the quarter, a dedicated funding solution that replaces a previously announced debt arrangement and fully covers the C$155 million in capital expenditure (capex) for Queensway Phase 1, advancing the project through to production.

Hammerdown Mine Operations

Hammerdown's inaugural revenue quarter establishes it as a profitable operating mine, generating C$1,436,229 in mine operations income against total cost of sales of C$8,451,600. Revenue for the three months ended March 2026 totalled C$9,887,829, with gold contributing C$9,861,490 and silver C$26,339. The cost structure comprises C$8,399,966 in operating expenses and C$51,634 in selling expenses. In the prior comparable period, the three months ended March 31, 2025, recorded nil revenue and nil operating expenses, reflecting that the Mining Operations segment was established only after the Maritime Resources acquisition was completed in November 2025. 

Net income before taxes of C$1,024,251 confirms the mine's earnings after segment-level charges are applied, and segment net income of C$558,038 is the tax-adjusted result. The step-down from C$1,436,229 in mine operations income to C$1,024,251 in pre-tax income, and then to C$558,038 in segment net income, is a progressive reduction with no anomalous charge disrupting the conversion. Hammerdown is generating a positive return at every level of the income statement in its first operating quarter, a result achieved before the mine has reached its commercial production milestone or completed its ongoing mill optimisation initiatives.

Hammerdown delivers ore to the Pine Cove Mill under a hub-and-spoke processing model, concentrating processing infrastructure at a single facility and creating the structural conditions for the mill to serve as a shared asset for additional ore feed as the broader New Found Gold platform develops. Commercial production is targeted in the second half of 2026 as the Company continues to ramp up its mining operations.

Queensway Segment Expenditure

The Exploration and Evaluation segment spent C$12,554,884 in the first quarter of 2026, with C$12,259,482 attributable to the Queensway property, establishing a quarterly capital demand that operates on a categorically different scale from Hammerdown's mine-level income. Drilling was the largest single cost category at C$4,012,279, the direct cost of four active diamond drill rigs running simultaneously through the period. Personnel, consulting, and overheads consumed C$3,106,814, representing the programme management and staffing cost of running a multi-rig, multi-discipline exploration campaign. Assaying and metallurgical testing of C$1,982,598 reflects the analytical processing cost of converting drill core into the datasets required to advance the resource through technical studies and economic evaluation. 

The remaining categories complete the full capital account for the period. Technical studies and resource evaluation totalled C$1,918,962, and geological and geophysical studies C$1,310,168, together covering the interpretive and modelling work running in parallel with active drilling. Property holding and other costs were C$534,422, and trenching was C$3,010. An environmental, permitting, and reclamation recovery of C$313,369 reduced gross expenditure, producing the net first-quarter total of C$12,554,884. 

Four active diamond drill rigs completed 32,000 metres of drilling between January and June 2026. The full-year Queensway programme targets 90,000 metres on a C$44 million annual budget, which is fully funded. Rig count is scheduled to expand from four to six rigs in mid-June 2026, a step-change that will accelerate both drilling pace and capital deployment through the remainder of the programme year. Against the C$44 million annual budget, the Queensway property's first-quarter spend of C$12,259,482 reflects a programme running at high capital intensity from the outset, and the planned rig expansion confirms that intensity will increase rather than moderate as the year advances.

Finance Package Structure & Terms

The C$220.05 million Finance Package pairs a C$105 million senior secured credit facility with a C$115.05 million bought-deal equity raise, replacing a previously announced debt arrangement and introducing long-term institutional equity investors alongside a defined-term credit facility into New Found Gold's capital structure. The credit facility is provided by EdgePoint Investment Group Inc. It is structured as a C$70 million Tranche 1 and a C$35 million Tranche 2. 

The bought-deal equity raise of C$115.05 million closed in April 2026 and strengthened the Company's long-term anchor investor base, with cornerstone investor Eric Sprott among those participating. 

Chief Executive Officer of New Found Gold, Keith Boyle, describes the strategic intent behind replacing the earlier arrangement:

"What I would say is we replaced the debt package that we had previously announced with a long-term equity shareholder, a funder, if you will."

For management, the substitution introduces the capital base “for the long haul." Paired with the C$105 million debt facility, this long-term equity provides the capital required to advance Queensway through to production.

Capital Structure & Funding Adequacy

The Finance Package delivers C$185 million in fresh capital, comprising C$115 million from the equity raise and C$70 million from the Tranche 1 debt draw, directly against a C$155 million Phase 1 capex requirement for Queensway. Prior to the debt drawdown, the Company held C$37,915,202 in cash and equivalents against total corporate liabilities of C$115,666,527. Post-financing, the Company's cash and marketable securities total C$148 million. This liquidity fully covers the Phase 1 capital requirement and advances the project through to production.

Boyle, referencing the Queensway preliminary economic assessment (PEA), sets out the arithmetic:

"You add that to the 115. We're up to $185 million that we've now got in the kitty in order to advance the Queensway project. Our PEA, if you recall, the capex on that was $155 million. And so we are fully funded to advance Queensway through to production and haven't even spoken about the second tranche as part of that financing."

Proceeds are allocated to early works permitting, detailed engineering, procurement of long-lead items for the Pine Cove Mill expansion, relocation of the hydro power line spanning the deposit, and pre-construction activities that prepare the site and the supply chain for Phase 1 construction.

Production Outlook & Free Cash Flow

The quarterly mine operations income from Hammerdown is the opening data point on a mine that projects C$243.3 million in total undiscounted after-tax free cash flow across a 13-year operating life. Hammerdown carries a life-of-mine (LOM) all-in sustaining cost (AISC) of US$2,429 per ounce, a figure that establishes the long-run cost of gold production at the mine and the economic floor below which sustained profitability begins to erode across gold price cycles. Commercial production will apply the full-scale test against which the C$243.3 million undiscounted after-tax free cash flow projection will begin to accumulate over the mine's operating life.

At full build-out in Phase 2 of Queensway, the combined Hammerdown and Queensway platform targets approximately 191,000 ounces of annual gold production, with Queensway accounting for the substantial majority of that volume. That target defines the production architecture that the Finance Package is designed to enable. 

Boyle is direct on the combined platform's free cash flow potential:

"Plus, you add that to Hammerdown, about 100,000 ounces from Queensway at an all-in sustaining of $1,300 based on the PEA that we put out last year. At today's prices, you're looking at over $300 of free cash flow."

The $300 million combined free cash flow projection at current gold prices is the financial destination to which New Found Gold's capital deployment is structured. Hammerdown's C$243.3 million in total undiscounted after-tax free cash flow across its 13-year mine life provides the base production asset, and Queensway's development adds the second concurrent output segment, making the combined annual target achievable.

Investment Thesis for New Found Gold

• Hammerdown generated C$1,436,229 in mine operations income and C$558,038 in segment net income in its inaugural revenue quarter, confirming that the Mining Operations segment established through the Maritime Resources acquisition in November 2025 produces a positive return at every level of the income statement from its first quarter of operation.
• The Exploration and Evaluation segment spent C$12,554,884 in the first quarter of 2026, with C$12,259,482 attributable to Queensway, with drilling, personnel/consulting/overheads, and assaying and metallurgical testing as the three largest cost categories, establishing a quarterly capital demand that operates on a categorically different scale from Hammerdown's mine-level income. To advance the project, the Company closed the C$220.05 million Finance Package shortly after the end of the quarter.
• The C$220.05 million Finance Package, comprising a C$105 million senior secured credit facility from EdgePoint Investment Group Inc., and a C$115.05 million bought-deal equity raise, replaced a previously announced debt arrangement and strengthened the Company's long-term anchor investor base, with cornerstone investor Eric Sprott among those participating.
• The Finance Package delivers C$185 million in fresh capital, comprising C$115 million from the equity raise and C$70 million from the Tranche 1 draw, with the Company's post-financing cash and marketable securities totalling C$148 million. This directly covers the C$155 million Queensway Phase 1 capex requirement, with an optional C$35 million Tranche 2 providing additional capacity.
• Hammerdown carries a life-of-mine (LOM) all-in sustaining cost of US$2,429 per ounce and projects C$243.3 million in total undiscounted after-tax free cash flow over a 13-year mine life, providing a base production asset as the Company advances Queensway.
• At full build-out in Phase 2 of Queensway, the combined Hammerdown and Queensway platform targets approximately 191,000 ounces of annual gold production with combined free cash flow projected at over $300 million at current gold prices, a target the Finance Package has been structured to enable by fully funding Queensway's development through to production.

New Found Gold's first-quarter 2026 segment financials establish a clear internal logic for the Company's current capital structure. Hammerdown is a producing mine with a positive track record at every level of the income statement, however short that track record remains before commercial production. Queensway is a capital-intensive exploration programme. The Finance Package is not a speculative raise for a future project: it replaces a previous debt arrangement and provides a precisely sized capital solution to fully fund Queensway's Phase 1 construction. The combined platform's projected free cash flow exceeds $300 million at current gold prices, and the capital to fund Phase 1 construction is in place.

TL;DR

New Found Gold’s Hammerdown generated C$1,436,229 in mine operations income in the first quarter of 2026, its inaugural revenue quarter, while the Exploration and Evaluation segment consumed C$12,554,884, with C$12,259,482 attributable to Queensway, over the same period. The C$220.05 million Finance Package, combining C$115 million in equity and C$70 million in Tranche 1 debt, delivers C$185 million in total available capital to fully cover the C$155 million Queensway Phase 1 capex requirement and advance the project through to production. At full build-out in Phase 2, the combined platform targets approximately 191,000 ounces of annual production and over $300 million in free cash flow at current gold prices.

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