TRX Gold (NYSEAMERICAN:TRX) executives said the company delivered record third-quarter operating and financial results at its Buckreef Gold Project in Tanzania, while outlining plans to fund a major mill expansion, tailings storage work and exploration largely through internal cash flow.
Chief Executive Officer Stephen Mullowney said the company has produced almost 28,000 ounces of gold over the last 12 months through the end of the third quarter, generating $115 million in revenue and $66.8 million in adjusted EBITDA. He said those results give TRX Gold confidence in its ability to fund expansion work at Buckreef.
Record Quarter Driven by Higher Throughput, Recoveries and Gold Prices
Chief Financial Officer Michael Leonard said Buckreef achieved record quarterly throughput of 1,690 tons per day, with an average grade of about 1.96 grams per ton. Recovery improved to nearly 85%, up from 67% in the prior-year period, following metallurgical improvements and upgrades to the existing 2,000-ton-per-day plant.
Leonard said the company commissioned a thickener, oxygen plant and Acacia Reactor during the quarter, and expects additional improvements, including an ADR plant and gold room, to come online in coming quarters.
Gold production exceeded 7,400 ounces in the quarter, up almost 60% from the prior-year period. Combined with a realized gold price of more than $4,700 per ounce, revenue was nearly $33 million.
Leonard said Buckreef remains a “low-cost, high-margin operation,” with full-year average cash costs in the $1,400 to $1,600 per ounce range. The company reported gross profit of nearly $20 million for the quarter, a gross margin ratio of about 60%, record GAAP net income of $8.4 million and record adjusted EBITDA of almost $21 million.
Leonard noted that annualizing the quarter’s adjusted EBITDA would imply more than $80 million, which he said positions the company well to fund its growth and capital plans. TRX Gold ended the quarter with nearly $27 million in cash and more than $36 million in working capital.
Expansion Program Underway at Buckreef
Mullowney said TRX Gold is advancing its fourth expansion at Buckreef, centered on a new 3,500-ton-per-day SAG and ball mill circuit that will operate alongside the existing plant. He said the mill has been ordered and the capital project is moving from planning into execution.
The company outlined an approximately $50 million capital budget over the next 12 to 18 months, including about $30 million for the new mill, $10 million for a tailings storage facility and $10 million for sustaining capital. Mullowney said roughly $6 million to $8 million of that total has already been spent, with the remainder expected to be funded from cash flow. He also cited undrawn credit lines as available liquidity if needed.
Mullowney said the expanded configuration could provide theoretical processing capacity of about 5,500 tons per day when combining the new mill with the existing 2,000-ton-per-day plant, though he cautioned that mining capacity and sequencing will determine how quickly the company can fill that capacity.
The company is updating the preliminary economic assessment released in May 2025. Mullowney said the revised study is expected in the fourth quarter of calendar 2026 and will incorporate the new capacity and an updated mine plan. He said the prior study showed a pre-tax net present value of $1.9 billion at a $4,000 gold price.
Management said the updated mine plan is expected to contemplate additional open-pit cutbacks, a deeper and longer pit, and a deferral of underground capital for at least a couple of years. Mullowney said higher gold price assumptions could make additional lower-grade resources economic.
Exploration Program to Ramp Up
Chief Operating Officer Richard Boffey said the company has completed a new geophysical program at Buckreef, including detailed magnetic, electroresistivity pole-to-dipole and dipole-to-dipole surveys. He said the work generated nine or 10 strong drill targets.
Boffey said the first of those targets was expected to be drilled the following week. TRX Gold currently has two exploration drill rigs on site, with a third in Tanzania awaiting delivery and a fourth in China ready to ship. The company also has an option on a fifth rig.
“We’re pretty excited about getting into these new targets,” Boffey said, adding that drilling will also revisit areas such as Stamford Bridge and Anfield.
Mullowney said assays are expected to begin flowing in the fourth quarter of calendar 2026. Boffey said Stamford Bridge could offer both open-pit and underground opportunities, including the possibility of a small underground operation supplying higher-grade material to supplement open-pit feed.
Tanzania Partnership and Government Discussions
During the question-and-answer session, Mullowney addressed the company’s partnership with STAMICO at Buckreef. He said the current joint venture structure is 55% owned by TRX Gold and 45% owned by STAMICO, with cash flow currently being reinvested into the project rather than distributed as dividends.
Mullowney said the 55/45 split becomes relevant after capital loans are repaid and if dividends are declared from Buckreef. He also said discussions with the Tanzanian government are advanced as the company seeks more favorable and investable terms, referencing other Tanzanian mining frameworks that include 80/20 or 84/16 ownership structures with a nondilutable government interest.
Khalaf Rashid, senior vice president for Tanzania, said the company is focused on community development, government engagement and communications in the country. He said TRX Gold supports local health and education initiatives, works closely with local authorities in Geita and has increased outreach regarding job creation, taxes and procurement associated with Buckreef.
Management Addresses Costs, Buybacks and Valuation
Executives said they expect costs to decline as the operation scales and plant upgrades reduce reliance on reagents such as hydrogen peroxide. Leonard said mining costs had started to normalize following a new contract mining arrangement, while processing costs should improve as plant enhancements reach nameplate capacity.
Asked about diesel supply risks tied to geopolitical tensions, Mullowney said the company has not seen a supply squeeze in Tanzania and said the country had ample refined diesel stock.
On dividends and buybacks, Mullowney said reinvesting cash into Buckreef offers more value at this stage because the company believes it can materially increase EBITDA without raising capital. He said a share buyback is one potential tool to address market conditions, but did not announce a plan.
Mullowney closed by saying TRX Gold remains focused on increasing EBITDA, net asset value and resources. “We have a great growth business plan in place, and we’re hopeful that the valuation will catch up to our growth profile,” he said.
About TRX Gold (NYSEAMERICAN:TRX)
TRX Gold Corporation engages in the exploration, development, and production of mineral property interests in the United Republic of Tanzania. The company primarily explores for gold deposits. It holds interests in the Buckreef gold project that comprises a single Special Mining License covering an area of 16.04 square kilometers and 12 Prospecting Licenses covering 98.19 square kilometers located in north-central Tanzania. The company was formerly known as Tanzanian Gold Corporation and changed its name to TRX Gold Corporation in May 2022.
