Serabi Gold Delivers Record Q2-2025 Production with 10,532 Ounces

• Serabi Gold achieved record production of 10,532 ounces in Q2-2025, representing a 17% increase from Q2-2024 and the highest quarterly output since operations recommenced in 2013.
• The company completed over 3,850 metres of horizontal development during the quarter, marking a 10% increase from Q1-2025 and the highest quarterly development since operations began.
• Cash balances strengthened to $30.4 million at quarter-end compared to $26.5 million at March 31, 2025, with net cash reaching $24.6 million after accounting for debt obligations.
• The company remains on track to achieve its 2025 consolidated production guidance of 44,000 to 47,000 ounces of gold based on strong first-half performance.
• Brownfield exploration delivered promising results from Palito Complex, Coringa Mine, and São Domingos target, with several high-grade intersections exceeding 20 g/t gold supporting resource expansion goals.

Serabi Gold plc is a Brazilian-focused gold exploration, development, and production, operating in the prolific Tapajós region of Para State, northern Brazil, where it has consistently produced 30,000 to 40,000 ounces of gold annually through its Palito Complex.

With ambitious plans to double production in the coming years through the development of the Coringa Gold project, Serabi has established itself as a significant player in the Brazilian gold mining sector. Recently, Serabi made a notable copper-gold porphyry discovery on its extensive exploration licence, further diversifying its asset base and growth potential.

Operational Excellence Drives Record Performance

The second quarter of 2025 marked a pivotal period for Serabi Gold, with the company achieving its highest quarterly gold production since operations recommenced in 2013. CEO Mike Hodgson emphasized the significance of this achievement, stating:

"We have followed a strong first quarter with an even better second quarter, which at 10,532 ounces, has been the highest quarterly output recorded since operations recommenced in 2013. Year-to-date, that gives total gold production of 20,545 ounces, slightly above budget and leaving us tracking guidance."

The production of 10,532 ounces represents not only a substantial 17% increase from the corresponding quarter in 2024 but also demonstrates the company's operational maturity and efficiency improvements across its mining operations. This achievement brings the year-to-date total to 20,545 ounces, positioning the company slightly above budget and firmly on track to meet its annual production guidance.

The impressive production figures were underpinned by significant improvements in operational metrics across both major mining complexes. Hodgson highlighted the operational improvements:

"Development rates were also excellent, 10% improved on the first quarter. A 17% increase on the corresponding quarter in 2024, and most pleasing within these numbers was the grade improvements at both Palito and Coringa. Palito plant feed grades year-to-date are 27% improved on the 2024 average, whilst Coringa plant feed grades improved 12%."

Total ore mined during the quarter reached 52,032 tonnes at an average grade of 6.72 g/t gold, compared to 44,924 tonnes at 7.09 g/t in the first quarter of 2025. The Palito Complex process plant successfully treated 51,246 tonnes at 6.67 g/t gold, demonstrating consistent processing capabilities and efficient throughput management. These operational improvements reflect the company's continued focus on optimizing mining processes and maximizing resource extraction efficiency.

Enhanced Development Activities Support Future Growth

The second quarter witnessed exceptional progress in horizontal development activities, with the company completing 3,850 metres of development work. This achievement represents a 10% improvement over the first quarter of 2025 and stands as the highest quarterly development figure since operations began. Of this total development, 1,879 metres constituted ore development, while the remainder comprised essential infrastructure including ramps, crosscuts, and stope preparation development. This substantial development program positions the company well for sustained production growth and provides the necessary infrastructure to access future ore reserves.

The emphasis on development activities reflects Serabi's strategic approach to maintaining and expanding its operational capacity. By investing heavily in underground infrastructure, the company ensures continued access to ore bodies while simultaneously preparing for future production increases. This development work supports the company's long-term production plans and provides the foundation for achieving its ambitious growth targets in the coming years.

Palito Complex Shows Continued Grade Improvement

The Palito Complex delivered strong performance during the second quarter, producing 5,607 ounces of gold compared to 4,666 ounces in the first quarter of 2025. Year-to-date production from Palito reached 10,273 ounces, demonstrating consistent operational performance. Significantly, the complex achieved notable grade improvements, with year-to-date mined grades averaging approximately 6.19 g/t gold compared to 4.86 g/t gold in 2024, representing a substantial 27% improvement over the previous year's average.

Much of the grade improvement at Palito can be attributed to successful stoping operations in the Barrichello zone, combined with excellent grades from the G3 vein, which served as the backbone of Palito's production from 2005 to 2017. Hodgson explained:

"At Palito, we have seen grades continue to improve and year to date 2025 mined grades have been approximately 6.19 g/t gold compared to 4.86 g/t gold in 2024. Much of this improvement has come from stoping the Barrichello zone, along with some excellent grades being returned from the G3 vein, which formed the backbone of production at Palito from 2005-2017."

The G3 vein is currently being mined on multiple levels, including the -20m, -85m, and -210m levels, and is expected to provide significant contribution to production through 2025-2027. This multi-level approach to the G3 vein demonstrates the company's ability to optimize extraction from proven ore bodies while maintaining operational flexibility.

Coringa Mine Demonstrates Operational Maturity

The Coringa mine continued its strong operational performance during the second quarter, contributing 4,925 ounces to total production. While this represents a slight decrease from the 5,347 ounces produced in the first quarter, year-to-date production of 10,272 ounces demonstrates the mine's consistent contribution to overall output. The mine's plant feed grades improved by 12% compared to 2024 averages, reflecting improved ore selection and processing efficiency.

Coringa's operational success has been significantly enhanced by the performance of its ore sorter, which has now been operational for six months with excellent results. Hodgson noted:

"At Coringa, the ore sorter has now been operational for 6 months with excellent performance. During this period, we have taken advantage of favourable economics and have been using the ore sorter to process low grade ore stockpiled since the mine opened, whilst higher grade ROM is transported directly to the Palito plant. By doing this we can produce more ounces from Coringa this year than originally planned."

The mine's development continues to progress with production now coming from two main sectors: Serra and Meio. The Serra zone, which has been operating for four years with multiple levels in development and production, continues to demonstrate excellent ground conditions. Production and development activities span from level 260m down to level 125m, with main ramps extending deeper below the 125m level. The newly developed Meio zone has seen significant advancement with levels 356m and 336m now fully developed and stoping operations recently commenced.

Expansion into Meio Zone Presents Challenges & Opportunities

The development of the Meio zone represents both an opportunity and a challenge for Serabi's operations at Coringa. While grades in the Meio zone are very encouraging, development rates have been slower than initially planned due to significantly weaker ground conditions compared to the Serra zone. The Coringa mine continues to grow with production now coming from two main sectors: Serra and Meio, with the Serra zone having operated successfully for four years across multiple levels.

The second quarter saw further development into the Meio zone, with levels 356m and 336m now fully developed and stoping operations recently commenced. However, the Meio zone presents more challenging conditions than the well-established Serra zone. Hodgson noted that while "grades are very encouraging, development rates are slower than planned" due to the significantly weaker ground conditions in the upper levels near the surface where rock conditions remain somewhat weathered.

Management expects ground conditions to improve as operations deepen, which should result in faster development rates in the future. The current challenges require additional support measures as development advances, which temporarily slows progress but is typical of shallow mining operations. The company's experience in managing these conditions, combined with appropriate support systems, positions it well to overcome these temporary challenges and realize the zone's full potential as operations move to deeper, more stable ground.

Robust Financial Position Supports Growth Initiatives

Serabi's financial position continued to strengthen during the second quarter, with cash balances reaching $30.4 million at the end of June 2025, compared to $26.5 million at the end of March 2025. This improvement reflects the company's ability to generate positive cash flow from operations while maintaining disciplined capital allocation. The company's net cash position, after accounting for interest-bearing loans and lease liabilities, stood at $24.6 million at quarter-end, representing a significant improvement from $21.1 million in the first quarter of 2025.

The company's debt management strategy has been particularly effective, with the full repayment of its $5.0 million unsecured loan arrangement with Itau Bank in Brazil on January 6, 2025. This loan, which carried an interest coupon of 8.47%, was replaced with a new $5.0 million loan from Banco Santander on January 22, 2025. The new arrangement carries a more favorable interest rate of 6.16% and is structured as a bullet payment due on January 21, 2026, providing the company with improved financing terms and greater financial flexibility.

Exploration Program Delivers Promising Results

The second quarter marked significant progress in Serabi's brownfield exploration program, with drilling activities gathering momentum across multiple targets. The company currently operates four drill rigs, with two at Palito and two at Coringa, targeting approximately 30,000 metres of drilling for the year. Hodgson highlighted the program's progress:

"The second quarter also saw our brownfield exploration programme gather pace. We have two rigs turning at Palito and two at Coringa as we target some 30,000 metres of drilling this year. The first results were published early in the quarter, with very encouraging results."

The first results from this expanded program have yielded very encouraging results, supporting the company's goal of increasing its current mineral resource inventory to between 1.5 and 2.0 million ounces. Hodgson noted:

"The drilling results from the Senna orebody at the Palito Complex, as well as Jatobá and Galena in Coringa, indicate we are progressing towards our goal of increasing the current mineral resource inventory to between 1.5Moz-2.0Moz."

Notable exploration results include several high-grade intersections that demonstrate the continued potential of the company's existing mining areas. At the Palito Complex, drilling of the Senna orebody returned impressive results including 0.6m at 27.17 g/t gold from 274m depth and 1.05m at 6.42 g/t gold from 276m depth. The Coringa exploration program has been equally successful, with the Jatobá orebody returning 0.5m at 27.78 g/t gold from 120m depth and the Galena orebody yielding 0.5m at 52.07 g/t gold from 150m depth.

The São Domingos target has produced particularly encouraging results, with multiple intersections demonstrating the area's potential for significant resource expansion. Highlights include 1.65m at 80.50 g/t gold from 193m depth, 1.35m at 19.97 g/t gold from 143m depth, and several other high-grade intersections that support the target's potential for future development. These results indicate that the company's systematic exploration approach is successfully identifying additional ore resources within its existing mining areas.

Production Guidance & Future Outlook

Serabi remains confident in its ability to achieve the 2025 consolidated production guidance of 44,000 to 47,000 ounces of gold. The company's production profile is structured to deliver greater quarterly production in the third and fourth quarters, which should enable it to reach the upper end of its guidance range. Hodgson expressed confidence in the company's outlook:

"We are enjoying excellent operational performance, strong prevailing gold prices, cash growth and anticipate further success. Our production profile will see greater quarterly production in Q3 and Q4 to reach guidance. With this as a foundation to what we anticipate will be a successful period of organic growth to look forward to in the second half of 2025."

The company's operational performance in the first half of 2025 provides a strong foundation for the remainder of the year. With year-to-date production of 20,545 ounces already achieved, the company needs to produce approximately 23,455 to 26,455 ounces in the second half to meet its guidance. Given the operational improvements demonstrated in the second quarter and the continued development of new mining areas, this target appears achievable.

Strategic Positioning for Long-Term Growth

Serabi's performance in the second quarter of 2025 demonstrates the company's successful execution of its operational strategy and positions it well for sustained growth. The combination of record production, improved grades, expanded development activities, and promising exploration results creates a compelling foundation for future expansion. The company's ability to generate positive cash flow while investing in growth initiatives reflects strong operational discipline and effective capital allocation.

The company's focus on brownfield exploration within its existing mining areas represents a cost-effective approach to resource expansion that leverages existing infrastructure and operational expertise. This strategy minimizes execution risk while maximizing the potential for resource discovery and development. The early success of the exploration program suggests that significant resource expansion is achievable within the company's current operational footprint.

For Investors

Serabi Gold's second quarter 2025 results represent a significant milestone in the company's operational development, with record production, improved financial metrics, and promising exploration results positioning the company for continued growth. The achievement of 10,532 ounces of gold production, representing a 17% increase from the prior year, demonstrates the company's operational maturity and effective resource management. The strong cash position of $30.4 million and net cash of $24.6 million provide financial flexibility to support ongoing development and exploration activities.

For investors, the key takeaways from this quarter include the company's ability to consistently improve operational performance, maintain strong financial discipline, and successfully execute its growth strategy. The 27% improvement in plant feed grades at Palito, combined with the successful performance of the Coringa ore sorter, demonstrates management's ability to optimize operations and maximize resource extraction. The promising exploration results from the 30,000-metre drilling program support the company's goal of doubling its resource base to 1.5-2.0 million ounces, providing a clear path for future production growth.

The company's maintenance of its 2025 production guidance of 44,000-47,000 ounces, combined with the strong operational foundation established in the first half of the year, suggests that Serabi is well-positioned to achieve its near-term objectives while building the infrastructure necessary for long-term expansion. The combination of operational excellence, financial strength, and exploration success creates a compelling investment proposition for shareholders seeking exposure to Brazilian gold production with significant growth potential.