Equinox surges to 3-year high on Q2 results, growth outlook

[Redator]

Equinox Gold (TSX, NYSE-A: EQX) surged to its highest in over three years after reporting second-quarter earnings results that beat analyst estimates while offering a positive outlook on the rest of the financial year.

For the three months ended June 30, the Canadian gold miner produced a total of 150,849 oz. across its operations, representing a 23% increase over last year and 4% higher than the previous quarter. This output excludes contributions from the Nicaragua operations and the Pan mine in Nevada that it acquired from Calibre during the quarter.

The strong Q2 results, says Equinox CEO Darren Hall, are led by the Greenstone mine in Ontario, where mining rates increased 23% and processing rates improved 20% over the first quarter.

The higher production, coupled with a higher realized gold price of $3,207/oz., lifted Equinox’s quarterly revenue by nearly 78% and reversed its adjusted net income from a $46.4 million loss last year to a $56.7 million profit. On a per-share basis, the net earnings came to $0.11, easily beating analysts’ consensus of $0.02 a share.

Following the Q2 results, shares of Equinox jumped as much as 13% to C$10.75 apiece, the highest since April 2022. By 11:30 a.m. ET, the stock traded at C$10.59, with a market capitalization sitting just over the C$8 billion ($5.8 billion) mark.

BMO Capital, on the back of the new quarterly results, has raised its price target for Equinox to C$13 a share from C$11.50 previously.

Strong second half

In the Thursday release, Hall said Equinox is now entering a pivotal phase of growth and is expecting a strong second half of the year as it continues to ramp-up operations at Greenstone. The mine, which entered commercial production in November 2024, is expected to become one of Canada’s largest open-pit gold mines once in full production, averaging 330,000 oz. of production a year.

The company will also have full-quarter contributions from the newly acquired Calibre assets, which had 71,743 oz. of production prior to the transaction close.

“If the Calibre transaction had been effective from January 1, 2025, our pro-forma consolidated revenue for the first half would have been approximately $1.33 billion,” Hall said.

Following the acquisition, Equinox issued in June a new full-year guidance of 785,000-915,000 oz., which it expects to meet. However, the Castle Mountain and Los Filos mines, with a combined 3,470 oz. of output last quarter, were excluded.

Also not included in this guidance is the Valentine mine in Newfoundland and Labrador, which is expected to enter production in the third quarter.

According to Hall, this quarter will be an “inflection point” for the company, driven by “full-quarter contribution from the Calibre assets, first ore processed at Valentine and continued improvement at Greenstone.”