Fortitude Gold (OTCMKTS:FTCO) said first-quarter activity centered on starting up new mine areas, increasing processing capacity and advancing exploration, as the company works through what host Jason Reid described as a “rebuild year.”
Speaking on the company’s 2026 first-quarter conference call, Reid said Fortitude began production at County Line and Isabella Pearl Scarlet South during the quarter while continuing work at Isabella Pearl Deep. He said gold production increased progressively each month during the period, but the company is not yet providing a production forecast as it ramps up the new operations.
First-quarter financial highlights
Fortitude reported $3.2 million in net sales for the first quarter and said it produced 688 ounces of gold. The company ended March 31 with $10 million in cash and $31.3 million in working capital.
Other first-quarter highlights cited by Reid included:
- $2.2 million in mine gross profit.
- $1.7 million in exploration expenditures.
- $1,017 total cash cost after by-product credits per ounce of gold sold for the Isabella Pearl Mine.
- $2,263 per ounce total all-in sustaining cost for the Isabella Pearl Mine.
- $0.8 million in dividends paid.
- 611 ounces of gold rounds or bullion held as of March 31.
The company also completed a $12 million private placement during the quarter and entered into a 60% joint venture for the East Camp Douglas property.
Mining ramp-up underway at multiple sites
Reid said the company is actively mining from Isabella Pearl Deep, Scarlet South and the County Line East pit. He noted that Scarlet South and County Line East have lower average grades than Isabella Pearl Deep and the County Line main pit, requiring higher throughput to lift production.
To address that, Fortitude installed and commissioned a larger crushing facility at the Isabella Pearl processing site. Reid said the system was originally purchased for the Golden Mile project and is expected to more than triple crushing throughput capacity, increasing from approximately 250 tons per hour with the prior crusher to more than 800 tons per hour.
“Our team has done a great job bringing that crushing system online,” Reid said.
At County Line, Reid said reaching high-grade gold in the main pit remains a priority. The company is currently mining the old access ramp as part of a larger pit layback program. He said the ramp contains “some nice gold grades,” and the layback is expected to take the rest of the year to complete. Access to approximately 40,000 ounces of high-grade gold after the layback is targeted for 2027 and 2028 production.
Power line delay continues, but savings expected
Fortitude continues to await the final connection to grid power at Isabella Pearl. Reid said power line construction has reached the project, but delivery of custom-built switchgear remains the final step before the company can connect.
“This delay in delivery is frustrating, but we are told this month is the month,” Reid said.
In the question-and-answer portion, Reid estimated that once the line is connected, the company expects approximately $80,000 to $100,000 per month in energy savings. He said Fortitude plans to issue a press release when the connection is complete.
Reid also addressed investor questions about costs associated with operating three mines instead of one. He said trucking costs from Scarlet South and County Line are new, with County Line farther away, but the company expects grid power savings to offset some of those costs.
East Camp Douglas exploration accelerates
Reid called the company’s joint venture with Hawthorne Land & Minerals at East Camp Douglas “extremely exciting,” saying it allowed exploration work to resume immediately and on a more aggressive basis than Fortitude could have pursued alone.
He said initial drilling results from East Camp Douglas “may represent the strongest set of drill intercepts the company has achieved to date.” According to Reid, mineralization is shallow and may be composed of vein swarms that could potentially be mined by open pit.
Intercepts cited on the call included 3.05 meters grading 12.90 grams per ton gold within 24.38 meters grading 3.89 grams per ton gold, as well as intervals of 10.67 meters grading 2.08 grams per ton gold, 46.24 meters grading 1.13 grams per ton gold, 7.62 meters grading 4.95 grams per ton gold, 7.62 meters grading 3.13 grams per ton gold and 18.29 meters grading 1.1 grams per ton gold.
“I have said for years East Camp Douglas represents home run potential for Fortitude,” Reid said. “These recent drill results set us up for that potential.”
In addition to East Camp Douglas, Reid said exploration is focused on Scarlet and County Line, with the goal of expanding mineralization in those areas.
Management addresses dividends, labor and permitting
Asked about Fortitude’s dividend, Reid said it will not be tied to a specific metric such as free cash flow. He said management remains committed to the dividend but needs flexibility as the company builds new mines and deploys capital.
“No dividend policy can adequately capture all the inputs, variables, and operational unknowns to create a clean, long-lasting policy,” Reid said.
Reid also said manpower remains an ongoing challenge, noting that Fortitude recently lost workers to a neighboring operation. He said retaining employees is likely to remain an issue for the broader mining industry as metal prices rise and more companies increase activity.
On permitting, Reid said Fortitude continues to seek approvals for Golden Mile and Scarlet North. “We want to permit everything possible during this mining-friendly administration,” he said.
Reid said the company has not experienced supply disruptions tied to global unrest or wars. He also addressed a question about a potential listing on a Canadian mining exchange, saying that if Fortitude uplists, it would likely be to the New York Stock Exchange rather than a Canadian exchange.
Asked about Isabella Pearl Deep, Reid said Fortitude remains active there and that Isabella Pearl has “exceeded all of our expectations,” noting that the mine has operated longer than its original anticipated mine life.
About Fortitude Gold (OTCMKTS:FTCO)
Fortitude Gold Corporation is a U.S.-based gold producer and exploration company traded on the OTC Markets under the symbol FTCO. The company’s principal asset is the Pan Mine, an open-pit, heap-leach gold operation located on the prolific Carlin Trend in Elko County, Nevada. Through its wholly owned subsidiary, Fortitude Gold Mining Company, it focuses on the extraction, processing and sale of gold dore bars to regional refineries.
The Pan Mine employs conventional open-pit mining techniques followed by carbon-in-leach processing to recover gold from low-grade ore.
