Rio2 Reports First Quarter 2026 Financial Results and Operations Update

VANCOUVER, British Columbia, May 15, 2026 (GLOBE NEWSWIRE) -- Rio2 Limited (“Rio2” or “the Company”) (TSX: RIO; OTCQX: RIOFF; BVL: RIO) reports financial results for the three months ended March 31, 2026, highlighted by initial production and the early stages of ramp-up at the Fenix Gold Mine (“Fenix Gold”) and initial contribution from the Condestable Copper Mine (“Condestable”) since closing of the acquisition on January 30, 2026. Rio2’s consolidated production for the quarter totaled 7,849 ounces of gold, 49,198 ounces of silver, and 6,403,188 pounds of copper. All financial information in this press release is reported in U.S. dollar unless otherwise indicated.

Andrew Cox, President and Chief Executive Officer of Rio2, stated: “Q1 2026 was a milestone quarter for Rio2, with first production from Fenix Gold and the addition of cash flows from Condestable. At Fenix Gold, the team advanced through the initial ramp-up while addressing some unforeseen start-up challenges. Although the ramp-up was slower than anticipated, most critical issues have now been addressed and rectified, and we are expecting production to steadily increase to projected levels over the remaining three quarters of 2026. Operating a new mine at high altitude in Chile is a challenging undertaking and the management team has done a great job in resolving those challenges and keeping the mine on its path to producing more than 60,000 ounces of gold during 2026. Meanwhile, in Peru, Condestable has performed well and to our expectations during our first two months of ownership as integration of the mine’s operating team with Rio2 continues.”

Alex Black, Executive Chairman of Rio2, stated: “The entire Rio2 and Fenix Gold team has once again demonstrated its ‘can do’ attitude and culture to take on the challenge of starting up a new mine at high altitude in Chile. Start-up has not been easy, but the team’s ability to methodically identify, resolve and move past challenges reinforces my confidence that Fenix Gold is on track to reach the performance level we expect. Condestable has continued to produce to plan in Q1, a credit to the onsite management team, as well as to the Rio2 management team in handling the Condestable integration.”

FIRST QUARTER 2026 HIGHLIGHTS

Operational and financial results for the Condestable Mine in this section, and throughout the remainder of this press release, are presented for the period January 30, 2026 (acquisition date) to March 31, 2026.

Advanced Fenix Gold ramp-up with key start-up constraints identified and being addressed, while water transport, blasting fragmentation and leach recovery performance tracked in line with expectations.
Condestable performed well during Rio2’s first two months of ownership, providing immediate cash flows from copper, gold and silver production.
Income from mine operations of $24.6 million and adjusted net income¹ of $12.1 million, compared to Income from mine operations of $0 and adjusted net loss¹ of $1.3 million for the three months ended March 31, 2025.
Maintained a strong liquidity position, ending March 31, 2026 with cash and cash equivalents of $93.1 million, including the voluntary repayment of $20 million of debt, compared to cash and cash equivalents of $46.4 million as at December 31, 2025.
Quarterly consolidated gold production of 7,849 ounces and gold sales of 6,654 ounces at an average realized price¹ of $4,745/oz.
Q1 2026 total cash costs of $2,620 per ounce of gold sold¹ at the Fenix Gold Mine. Fenix Gold Mine produced 4,648 ounces of gold during the quarter.
Quarterly copper production of 6,403,188 pounds and copper sales of 6,204,313 pounds at an average realized price of $5.69 per pound.
Q1 2026 total cash costs of $2.01 per pound of copper produced¹ and AISC¹ of $2.84 per pound of copper produced at Condestable. The 6,403,188 pounds of copper produced was entirely at Condestable. Condestable also produced 3,201 ounces of gold and 48,671 ounces of silver.
Cash provided by operating activities in the quarter was $22.8 million, cash used in investing activities of $80.3 million, and net cash provided from financing activities of $103.5 million, compared to cash flow from operating activities in the comparative quarter ended March 31, 2025 was $19.3 million, cash used in investing activities of $16.2 million, and net cash provided from financing activities of $0.04 million.
(1) See Non-IFRS Measures section of this press release for definitions and discussion.

OPERATIONS

Fenix Gold Mine

Mine Production - the Fenix Gold Mine continued through its initial production ramp-up during Q1 2026. While planned tonnes and grade were not achieved during the quarter, the key drivers were identified early and corrective actions have been implemented or are underway. Those factors include:

Blasting permit delay – the blasting permit was expected to be issued by mid-November 2025 and was received in late-December 2025, effectively setting the mine plan for 2026 back by 6 weeks.
Opening up Fenix South – initial mining at the peak of Fenix South required careful sequencing between drilling, blasting and mining activities in a constrained area. Operating space has now been created, which is expected to support more efficient mining going forward. Fenix South is a newer area within the Fenix Gold mine plan which began contributing ore to the leach pad during Q1, 2026.
Operator availability - A tight labor market in Chile with high metal prices and increased mining activity, created challenges for our contractor STRACON in retaining personnel, particularly truck drivers willing to work at a high altitude mine such as Fenix Gold. STRACON And Rio2 have been actively addressing the turnover and absenteeism that impacted trucking during Q1. By the end of March, the operator and truck availability were improving, and it is expected that these issues will be satisfactorily resolved in Q2 2026.
Truck fleet transition - the initial mine truck fleet consisted of rented 35-tonne capacity trucks from local providers, originally mobilized during construction of the plant and pad facilities and not optimized for steady-state mine operations. These trucks are being phased out and replaced by a new fleet of 42-tonne capacity trucks that have been purchased by STRACON specifically for mine operations. This fleet of new trucks will start arriving in May 2026 and will be maintained on site by STRACON’s maintenance team.

Lower tonnes moved reduced ore availability and affected head grade to the plant, resulting in lower grade ore being sent to the pad. Management took the decision not to high-grade mining until planned production rates can be achieved. Mining of higher-grade material (greater than 0.4g/t) is expected to resume during H2 2026, at which time lower grade material will be sent to stockpile. To further increase mine production flexibility, management has also decided to bring forward the commencement of mining at Fenix Central which will now start in Q2, 2026.

The processing plant experienced initial start-up issues with the elution solution pump failing three times causing delays in the desorption process. A replacement pump arrived in March, and this issue has now been resolved.

Water transport ramp-up has been very successful with trucking consistently delivering over 1,000 m3 per day, and up to 1,500 m3 on occasions. The mine has not been water constrained and at the end of March the mine water storage was overstocked for a total on-site water inventory of 45,000 m3.

Blasting fragmentation of mineralized material has also performed to expectation with a P80 of 4 inches being achieved for the quarter.

Analysis of the leaching of material on the pad versus the gold being absorbed in carbon in the processing plant indicates that the projected gold recovery of 75% at 90 days leaching is being achieved.

Based on current ramp-up progress, Rio2 anticipates achieving commercial production at Fenix Gold in Q4 2026.

Gold production guidance for 2026 is 60,000 – 65,000 gold ounces, with efforts being made to bring forward the mining production rate to 20,000 tonnes per day in Q2 2026 and for the remainder of the year, to recover the reduced tonnes and ounces production experienced during Q1 2026.

Key performance data for the Fenix Gold Mine for Q1 2026 is summarized as follows:

		Q1 2026		Q1 2025⁽²⁾
Total tonnes mined	tonne	901,264	tonne	N/A
Ore mined	tonne	807,590	tonne	N/A
Ore stacked in pad	tonne	657,112	tonne	N/A
Head Grade (g/t Au)	g/t	0.452	g/t	N/A
Contained ounces in pad	oz	9,554	oz	N/A
Gold ounces produced	oz	4,648	oz	N/A
Gold ounces sold	oz	3,934	oz	N/A
Cash cost per gold ounce sold ⁽¹⁾	$/oz	2,620	$/oz	N/A
All-in Sustaining cost per gold ounce sold ⁽¹⁾	$/oz	3,131	$/oz	N/A
All-in Cost per gold ounce sold ⁽¹⁾	$/oz	3,151	$/oz	N/A
Silver ounces produced	$/oz	527	$/oz	N/A
Silver ounces sold	$/oz	514	$/oz	N/A
Average realized price per gold ounce ⁽¹⁾	$/oz	4,750	$/oz	N/A
Average realized price per silver ounce ⁽¹⁾	$/oz	83.77	$/oz	N/A

⁽¹⁾See Non-IFRS Measures section of this press release for definitions and discussion.
⁽²⁾This information was not available (“N/A”) for Q1 2025 or not applicable as the Company’s only asset was the Fenix Gold Mine and it did not have production or sales during Q1 2025.

Human Resources – A total of 1,401 personnel (including contractors) are currently employed at Fenix Gold in mine operations, construction and exploration. 94% of the workforce is comprised of Chileans, with 42% from the Atacama Region, and 12% are female.

Health & Safety – A total of 650,424 person-hours has been worked at the mine in Q1 2026, with one LTI from a twisted ankle which occurred in March 2026 for an LTIFR rate of 0.6.

Exploration – For the first time since 2014, exploration drilling has commenced at Fenix Gold. In total, 9,250 m of reverse circulation drilling and 13,940 m of diamond drilling will be carried out, for a total of 23,190 m. The budget for this drilling program is $9.5 million. The objectives of the 2026 drilling program are to upgrade the classification of mineral resources from inferred to indicated and/or measured, and to increase mineral resources below the reserve pit and to 100 m below the current resource pit. Drill rigs were mobilized during March for drilling in Q2.

Fuel Hedging – As a consequence of the Iran War, diesel prices in Chile during Q1 2026 have increased by up to 60%. As the transition from construction to full operations at Fenix Gold progresses, diesel consumption for the mining fleet and infrastructure will remain an important operating expense. In early March 2026, Rio2 secured a portfolio of 9 commodity call options (hedges) used to lock in prices to protect against the risk of rising fuel costs at the mine. These hedge contracts span a nine-month period from April through December 2026, covering a total volume of 1,575,000 gallons. The protected monthly volume scales up over time, starting at 150,000 gallons in the spring, increasing to 175,000 in the summer, and peaking at 200,000 gallons per month through the end of the year. The upfront premium paid to secure these nine positions was $622,000.

As of March 31, 2026 valuation date, their combined market value was $770,000, including an unrealized gain of $148,000. As of April 30, 2026 valuation date, their combined market value has risen to $1,037,000 for a total gain of $415,000 which included a realized gain of $131,000 in April 2026 plus an unrealized mark-to-market gain of $284,000 on the remaining open contracts.

Mine Expansion Study – Work on desalinated water alternatives continues with two potential providers selected to provide initial estimates for capital and operating costs, and timelines for connecting Fenix Gold project to desalinated water from Copiapó. Results from both providers are now expected to be delivered by June. The selection of one of these providers to supply desalinated water to Fenix Gold will then enable the prefeasibility study for the expansion case to increase the production rate to 80,000 tonnes per day to be completed. Timing for the release of that study is now expected to be Q3 2026. In anticipation of this study, the Fenix Gold permitting team have started work on the baseline study for the expanded mine site EIA, which includes expansion to the existing pits at Fenix north, central and south to form one combined pit, the expansion of the adsorption, desorption and recovery plant (“ADR plant”), piped water supply, the expanded leach pad footprint, the expanded waste dump footprint, additional water ponds, grid power connection, a truck shop for a large equipment fleet, and other support infrastructure.

Construction Activities – In 2025, Rio2 expended the critical capital necessary to bring Fenix Gold into gold production to begin generating cash flow. For 2026, the plan is to complete the deferred capital expenditures required for the mine to enter 2027 at a consistent production rate of 20,000 tonnes per day of ore to pad. During Q1 2026, deferred capital expenditures included completing items around the ADR plant and restarting leach pad construction for pad expansion.

The remaining capital planned to be expended in 2026 which will be funded out of cash reserves and cashflow is summarized as follows:

	TOTAL
	USD
Construction	32,499,385
Access roads	240,927
ADR Plant	4,354,926
Leach Pad Construction	11,330,033
Lime Plant	1,178,177
Power Generation	2,071,877
Electric Power distribution	1,287,022
Communications infrastructure	137,252
Reagents first fill	342,172
Onsite laboratory	1,710,000
Truck Work Shop	9,847,000

Sustaining Construction	1,369,732
Preliminary Works	-
Camp Infrastructure	20,000
Leach Pad expansion	1,349,732

Total USD	33,869,117

Condestable Mine

Mine Production - Condestable delivered solid operating performance in February and March, processing over 470,000 tonnes of ore at an average copper grade of 0.70%, 0.24 g/t gold and 4.10 g/t silver. Although copper grades were partly below planned grades, this was compensated by higher gold production through higher grades and recoveries. Unit production costs were better than expected at $38.90/t due to a higher mix of ore being extracted from upper levels of the mine and exchange rates being more favorable than initially estimated. This was achieved despite some difficulties in managing the ore and waste haulage fleet due to a lack of truck operators and larger capacity haulage equipment challenges.

Overall processing plant performance was strong. Copper recoveries were marginally below expectations due to higher oxide material in certain near surface sections of the mine, while gold and silver recoveries were materially better than budgeted. Condestable produced 6,403,188 pounds of copper, 3,201 ounces of gold and 48,671 ounces silver during February and March, contained in concentrate.

Production guidance for 2026 (February to December) is 21,500 – 23,500 tonnes of payable copper equivalent.

Key performance data for the Condestable Mine for Q1 2026 is summarized as follows:

		Q1 2026		Q1 2025⁽²⁾
Exploration drilling	m	541	m	N/A
Production drilling	m	6,690	m	N/A
Deepening works	M	656	m	N/A
Ore mined	tonne	486,188	tonne	N/A
Ore treated	tonne	474,341	tonne	N/A
Cu headgrade	%	0.70	%	N/A
Au headgrade	g/t	0.24	g/t	N/A
Ag headgrade	g/t	4.10	g/t	N/A
Cu recovery rate	%	89.55	%	N/A
Au recovery rate	%	81.94	%	N/A
Ag recovery rate	%	83.20	%	N/A
Copper produced	lb	6,403,188	lb	N/A
Gold produced	oz	3,201	oz	N/A
Silver produced	oz	48,671	oz	N/A
Copper sold	lb	6,204,313	lb	N/A
Gold sold	oz	2,720	oz	N/A
Silver sold	oz	46,588	oz	N/A
Cash cost per copper pound produced ⁽¹⁾	US$/lb	2.01	US$/lb	N/A
All In Sustaining Cost (AISC) per copper pound ⁽¹⁾	US$/lb	2.84	US$/lb	N/A
All In Cost per copper pound ⁽¹⁾	US$/lb	3.25	US$/lb	N/A
Average realized price per copper pound ⁽¹⁾	US$/lb	5.69	US$/lb	N/A
Average realized price per gold ounce ⁽¹⁾	US$/oz	4,736	US$/lb	N/A
Average realized price per silver ounce ⁽¹⁾	US$/oz	75.29	US$/lb	N/A

Human Resources – A total of 1,984 personnel (including contractors) are currently employed at Condestable in mine operations, construction activities and exploration. 99% of the workforce is comprised of Peruvians and 7.6% are female.

Health & Safety – A total of 1,002,501 person-hours has been worked at the mine in Q1 2026, with four LTI for an LTIFR rate of 3.99.

Exploration – Condestable has launched a three-part exploration program for 2026. In Q1, a 45,000 m underground diamond drilling program commenced with the main objective of replacing and increasing mineral resources, and infill drilling to generate short-term reserve models. This is an annual activity at the mine. The second objective consists of increasing and delineating mineral resources close to surface in the Condestable and Raúl areas. The plan is to generate a Cu-Au-Ag mineral resource that can potentially be mined by open-pit methods. The near-surface drilling program will be defined and costed during Q2 , and its execution will take place during H2. The third objective consists of conducting a 1:25,000 scale geological/structural mapping of the 46,000 hectares of mining concessions. Additionally, magnetometry geophysical surveys will be carried out using drones across the entire mining property. This new information, generated during 2026, will be integrated with the existing multi-element surface geochemistry in the current database, with the aim of generating new regional exploration projects. This will be the first time that an exploration program of this kind will have been undertaken over the entire Condestable land package.

Resource/Reserve Update – Rio2 has engaged SLR Consulting to complete an updated mineral resource/reserve estimate (“MRE”) for Condestable, to update the current technical report entitled “NI 43-101 Technical Report on the Condestable Mine, Lima Department, Peru, dated April 12, 2024, effective date December 31, 2022”, prepared by SLR Consulting (Canada) Ltd. in accordance with National Instrument 43-101 filed on SEDAR+ under the Company’s profile. Rio2 anticipates that the updated MRE will be announced and filed during Q2 2026.

Grade Enhancement and Mine Expansion Planning - During March and April 2026, Condestable performed laboratory scale tests with a third-party ore sorting equipment supplier. The tests focused on low grade stockpiles and historical waste dump material which yielded an increase in copper grade of 1.4 – 1.6x, with rejected material of 30% - 45%, demonstrating significant potential for grade enhancement. Based on these favorable results, Condestable’s team is now aiming to initiate a 12-month 1,000 - 1,500 tonne per day (tpd) pilot plant program. The pilot phase will evaluate the economic and technical viability of sorting high grade ore from low-grade material from various stockpiled sources on site. The ore sorting pilot program is one of the potential components of the expansion plan at Condestable, together with the expansion of the underground mine and revaluation of historical resources. The Company expects to receive approval for the modification of the mine EIA during Q3 2026, including an approval for increased processing throughput to 10ktpd. In parallel, the Company’s projects team is currently completing the basic engineering, capital cost estimations and timeline for the plant expansion, which will be announced when completed.

EARNINGS AND CASH FLOW

Select Quarter Financial Information

Financial Results: (in thousands, except per share amounts)		Q1 2026				Q1 2025⁽²⁾
Copper sales	$		32,512				N/A
Gold sales	$		30,689				N/A
Silver sales	$		3,855				N/A
Pricing adjustments on concentrate sales	$		(1,198	)			N/A
Consolidated revenue	$		65,858				N/A

Net income ⁽⁴⁾	$		22,291		$		(1,598	)
Net income per share, diluted	$		0.04		$		0.00
Adjusted net income (loss) ⁽¹⁾	$		12,135		$		(1,349	)
Adjusted net income (loss) per share, diluted ⁽¹⁾	$		0.02				(0.00	)
EBITDA ⁽¹⁾	$		40,974				(1,532	)
Adjusted EBITDA ⁽¹⁾	$		30,818				(1,283	)
Total debt ⁽³⁾	$		112,563		$		254
Operating Results:
Copper pounds produced	lbs		6,403,188				N/A
Gold ounces produced	oz		7,849				N/A
Silver ounces produced	oz		49,198				N/A

Copper pounds sold	lbs		6,204,313				N/A
Gold ounces sold	oz		6,654				N/A
Silver ounces sold	oz		47,102				N/A

Average realized price per copper pound	$/lb		5.69				N/A
Average realized price per gold ounce	$/oz		4,745				N/A
Average realized price per silver ounce	$/oz		75.38				N/A

⁽¹⁾See Non-IFRS Measures.
⁽²⁾ Certain comparable information was not applicable (“N/A”) for Q1 2025 as the Company’s only mine was the Fenix Gold Mine during Q1 2025 and it did not have any production or sales.
⁽³⁾ Total Debt is a supplementary financial measure that does not have a standardized meaning under IFRS. The Company calculates Total Debt as the sum of loans payable, deferred consideration, and lease liabilities, including current and non-current portions.
⁽⁴⁾ Net income refers to net income attributable to the shareholders of Rio2 Limited. The portion attributable to non-controlling interests arising from the Company's interest in Compañía Minera Condestable S.A. has been excluded.

NON-IFRS MEASURES

This news release refers to certain financial measures, such as all-in-sustaining costs, which are not measures recognized under IFRS and do not have a standardized meaning prescribed by IFRS. These measures may differ from those made by other companies and, accordingly, may not be comparable to such measures as reported by other companies. These measures have been derived from the Company's financial statements because the Company believes that they are of assistance in understanding the results of operations and its financial position. Certain additional disclosures for these specified financial measures have been incorporated by reference and can be found in the Company's MD&A for Q1 2026, available on SEDAR+ at www.sedarplus.ca under the heading “Non-IFRS Measures”.

ADJUSTED NET INCOME

Management uses Adjusted net income to evaluate the Company’s operating performance, and to plan and forecast its operations. The Company believes the use of Adjusted net income reflects the underlying operating performance of our core mining business and allows investors and analysts to compare results of the Company to similar results of other mining companies. Management’s determination of the components of Adjusted net income is evaluated periodically and is based, in part, on a review of non-IFRS financial measures used by mining industry analysts. The tax effect of adjustments are based on statutory tax rates and the Company’s tax attributes, including the impact through the Company’s valuation allowance. The combined effective rate of tax adjustments may not be consistent with the statutory tax rates or the Company’s effective tax rate due to jurisdictional tax attributes and related valuation allowance impacts which may minimize the tax effect of certain adjustments and may not apply to gains and losses equally. Adjusted net income is reconciled to Net income in the following table:

In thousands except per share amounts		Q1 2026			Q1 2025
Net income (loss)	$	22,291		$	(1,598	)
Add back:
Acquisition related transaction costs	$	4,119		$	0
Restructuring costs	$	1,941		$	0
Share-based compensation	$	1,015		$	249
Fair value gain on Stream Obligation	$	(17,231	)	$	0
Adjusted net income (loss)	$	12,135		$	(1,349	)

Adjusted net income (loss) per share, Basic	$	0.02		$	0.00
Adjusted net income (loss) per share, Diluted	$	0.02		$	0.00

EBITDA AND ADJUSTED EBITDA

Management uses Earnings Before Interest, Taxes, Depreciation and Amortization (“EBITDA”) to evaluate the Company’s operating performance, to plan and forecast its operations, and assess leverage levels and liquidity measures. The Company believes the use of EBITDA reflects the underlying operating performance of our core mining business and allows investors and analysts to compare results of the Company to similar results of other mining companies. EBITDA and Adjusted EBITDA do not represent, and should not be considered an alternative to, Net income (Loss) or Cash Flow from Operations as determined under IFRS. Other companies may calculate Adjusted EBITDA differently and those calculations may not be comparable to our presentation. Adjusted EBITDA is reconciled to Net income (loss) in the following table:

In thousands		Q1 2026			Q1 2025
Net income (loss)	$	22,291		$	(1,598	)
Add back:
Finance costs, net	$	1,905		$	64
Income tax expense	$	4,781		$	0
Depletion, Depreciation and Amortization	$	11,997		$	2
EBITDA	$	40,974		$	(1,532	)

Acquisition related transaction costs	$	4,119		$	0
Restructuring Costs	$	1,941		$	0
Share-based Compensation	$	1,015		$	249
Fair value gain on Stream Obligation	$	(17,231	)	$	0
Adjusted EBITDA		30,818			(1,283	)

Cash cost per gold ounce sold

Cash cost is a common financial performance measure in the gold mining industry; however, it has no standard meaning under IFRS. For the Fenix Gold Mine, the Company reports cash costs on a per gold ounce sold basis. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate the Company’s performance and ability to generate operating income and cash flow from mining operations. Cash costs are calculated as mine site operating costs, net of non-recurring items that are not reflective of the underlying operating performance of the Company and are net of silver revenue. Cash costs are divided by ounces sold to arrive at cash costs per oz sold. In calculating cash costs, the Company deducts silver revenue as it considers the cost to produce the gold is reduced as a result of the by-product sales incidental to the gold production process, thereby allowing management and other stakeholders to assess the net costs of gold production. The measure is not necessarily indicative of cash flow from operations under IFRS or operating costs presented under IFRS.

Cash cost per payable copper pound produced

Cash cost is a common financial performance measure in the mining industry; however, it has no standard meaning under IFRS. For Condestable, the Company reports copper cash costs on a per payable copper pound produced basis. The Company believes that, in addition to conventional measures prepared in accordance with IFRS, certain investors use this information to evaluate the Company’s performance and ability to generate operating income and cash flow from mining operations. Cash costs are calculated as mine site operating costs, net of non-recurring items that are not reflective of the underlying operating performance of the Company and are net of gold and silver revenue. Cash costs are divided by payable copper pounds produced to arrive at cash costs per pound. In calculating cash costs, the Company deducts gold and silver revenue as it considers the cost to produce the copper is reduced as a result of the by-product sales incidental to the copper production process, thereby allowing management and other stakeholders to assess the net costs of payable copper production. The measure is not necessarily indicative of cash flow from operations under IFRS or operating costs presented under IFRS.

All-in sustaining cost ("AISC") and AISC per gold ounce sold and per payable copper pound produced and All-in cost (“AIC”)

AISC and AIC

AISC is a non‐IFRS measure and was calculated based on guidance provided by the World Gold Council (WGC). Other mining companies may calculate differently as a result of differences in underlying accounting principles and policies applied, as well as differences in definitions of sustaining versus development capital expenditures.

Includes cash cost (as defined above), sustaining capital expenditures, reclamation and other closure cost accretion and amortization and lease payments (cash basis). As this measure seeks to reflect the full cost of production from current operations, expansionary capital and certain exploration costs are excluded as these are costs typically incurred to extend mine life or materially increase the productive capacity of existing assets, or for new operations. Corporate general and administrative expenses of Rio2 Limited have also been excluded as any attribution of these costs to an operating site would not necessarily be reflective of costs directly attributable to the administration of the site. However, site level administration costs allocable to Condestable operations are included as they directly support the operating Condestable copper mine. Certain other cash expenditures, including tax payments, financing charges (including capitalized interest) and costs related to business combinations, asset acquisitions and asset disposals are also excluded.

All-in Costs is a non-IFRS measure and is calculated as AISC plus expansionary capital expenditures and expansionary exploration.

AISC per gold ounce sold and copper pound produced

This ratio is calculated by dividing AISC by the production volume of the primary metal produced (gold or copper).

Fenix Gold		Q1 2026			Q1 2025
On-site mining and processing costs (on a sales basis)	$	10,069		$	N/A
Community costs related to current operations	$	231		$	N/A
3rd party smelting, refining and transport costs	$	52		$	N/A
By-product and co-product credits	$	(43	)	$	N/A
Cash Cost⁽¹⁾	$	10,309		$	N/A
Corporate/regional G&A, incl. share-based remuneration (sustaining)	$	450		$	N/A
Reclamation & remediation — accretion & amortization (operating sites)	$	160		$	N/A
Capital exploration (sustaining)	$	772		$	N/A
Sustaining capital expenditure	$	629		$	N/A
All-in Sustaining Cost (AISC)⁽¹⁾	$	12,320		$	N/A
Capital exploration (non-sustaining)	$	77		$	N/A
All-in Cost (AIC)⁽¹⁾	$	12,397		$	N/A
Per gold ounce sold:⁽³⁾
Cash cost per gold ounce sold	US$/oz	2,620		US$/oz	N/A
AISC per gold ounce sold	US$/oz	3,131		US$/oz	N/A
AIC per gold ounce sold	US$/oz	3,151		US$/oz	N/A
⁽¹⁾ See Non-IFRS Measures section for definitions.
⁽²⁾ Q1 2025 figures are not available ("N/A") as the Company's only asset was the Fenix Gold Mine and it did not have production or sales during Q1 2025.
⁽³⁾ Per-unit measures use gold ounces sold as the denominator.

Condestable		Q1 2026			Q1 2025
Total production costs	$	19,477		$	N/A
Treatment and refining charges and commercial expenses	$	1,477		$	N/A
By-product credits, net of stream impact⁽³⁾	$	(8,701	)	$	N/A
Cash Cost (including stream impact)⁽¹⁾⁽³⁾	$	12,253		$	N/A

Sustaining capital expenditures	$	4,040		$	N/A
Other indirect and administrative costs	$	1,053		$	N/A
All-in Sustaining Cost (AISC, including stream impact)⁽¹⁾⁽³⁾	$	17,346		$	N/A

Expansionary capital expenditures (mainly tailings filter plant)	$	2,472		$	N/A
All-in Cost (AIC, including stream impact)⁽¹⁾⁽³⁾	$	19,818		$	N/A

Per payable copper pound produced (including stream effect):⁽⁴⁾
Cash cost (incl. stream effect)	US$/lb	2.01		US$/lb	N/A
AISC (incl. stream effect)	US$/lb	2.84		US$/lb	N/A
AIC (incl. stream effect)	US$/lb	3.25		US$/lb	N/A

⁽¹⁾ See Non-IFRS Measures section for definitions.

⁽²⁾ Q1 2025 figures are not available ("N/A") as the Company's only asset was the Fenix Gold Mine and it did not have production or sales during Q1 2025.

⁽³⁾ Stream deliveries reflect the Franco Nevada stream. First stream delivery occurs in April 2026.

⁽⁴⁾ Per-unit measures use copper payable pounds produced as the denominator.

Most directly comparable IFRS measure

Production costs from continuing operations.

Why management uses the measure and why it may be useful to investors

The Company believes that this measure represents the total sustainable costs of producing copper and gold from current operations, and provides the Company and other stakeholders of the Company with additional information of the Company’s operational performance and ability to generate cash flows.

Sustaining capital expenditures and expansionary capital expenditures

Sustaining capital expenditures

This supplementary financial measure is defined as cash basis expenditures which maintain existing operations and sustain production levels.

Expansionary capital expenditures

This non-IFRS measure is defined as cash-basis expenditures which increase current or future production capacity, cash flow or earnings potential and are reported excluding capitalized interest. Where an expenditure both maintains and expands current operations, classification would be based on the primary decision for which the expenditure is being made.

Most directly comparable IFRS measure

Investment in mineral properties, plant and equipment

Why management uses the measure and why it may be useful to investors

Sustaining capital expenditures provide an understanding of costs required to maintain existing production levels. Expansionary capital expenditures provide information on costs required for future growth of existing or new assets.

Realized price per pound and realized price per ounce

Defined as revenue from metal sales (copper and gold) adding back treatment and refining charges, cash effects of gold streams, recognition of deferred revenue from the allocation of upfront streaming proceeds, divided by the volume of metal sold in the period.

Most directly comparable IFRS measure

Revenue from continuing operations.

Why management uses the measure and why it is useful to investors

These measures provide an understanding of the price realized in each reporting period for metal sales.

Earnings before interest, taxes, depreciation and amortization ("EBITDA") and Adjusted EBITDA

EBITDA is a non-IFRS measure that represents an indication of the Company’s continuing capacity to generate cash from operations before taking into account management’s financing decisions and costs of consuming capital assets, which vary according to their equipment technology and management’s estimate of their useful life. Adjusted EBITDA is calculated as Operating Income plus depreciation, amortization, mine closure provision, workers’ profit sharing, devaluation of inventory and write-off of receivables. Adjusted EBITDA has been included in this document. Under IFRS, entities must reflect in compensation expense the cost of share-based payments.

Most directly comparable IFRS measure

Net earnings (loss) from continuing operations and from discontinued operations

Why management uses the measure and why it is useful to investors

The Company believes that these measures are used by and are useful to investors and other users of the Company’s financial statements in evaluating the Company’s operating and cash performance because they allow for analysis of its financial results without regard to special, non-cash and other non-core items, which can vary substantially from company to company and over different periods.

TECHNICAL INFORMATION

The scientific and technical content of this news release has been reviewed, approved and verified ‎by Enrique Garay, MSc P.Geo/FAIG, who is a QP under NI 43-101. For additional information regarding Fenix Gold, see the independent technical report entitled ‎‎“NI 43-101 Technical Report on the Feasibility Study for the Fenix Gold Project” dated October 16, 2023, with an effective date of October 16, 2023. For additional information regarding Condestable, see the independent technical report entitled “NI 43-101 Technical Report on the Condestable Mine, Lima Department, Peru, dated April 12, 2024, effective date December 31, 2022”. Copies of these Technical Reports are available under ‎Rio2’s SEDAR+ profile at ‎www.sedarplus.ca.

ABOUT RIO2 LIMITED

Rio2 is a diversified precious metals and copper producer focused on building and operating mines with a management team that has proven technical skills as well as a successful capital markets track record. The Company is currently producing gold at its Fenix Gold heap leach mine in Chile and copper/gold/silver at its recently acquired Condestable underground mine in Peru. Rio2 and its wholly owned subsidiaries, Fenix Gold Limitada and Compañía Minera Condestable S.A., are companies that operate with the highest environmental standards and responsibility with the firm conviction that it is possible to develop mining projects that respect the three pillars (Social, Environment, Economics) of responsible development. As related companies, we reaffirm our commitment to apply environmental standards beyond those mandated by regulators, seeking to protect and preserve the environment in the territories where we operate.

Forward-Looking Statements

This news release contains forward-looking statements and forward-looking information (collectively “forward-looking information”) within the meaning of applicable securities laws relating to Rio2’s development of the Fenix Gold Mine and other aspects of Rio2’s future operations and plans. In addition, without limiting the generality of the foregoing, this news release contains forward-looking information pertaining to the following: the anticipated mining and production rates for the remainder of 2026; anticipated production for 2026 and 2027 at Fenix Gold and Condestable, and guidance for same; details of drilling at both the Fenix Gold and Condestable mine, including costs and objectives of the drilling program and timing for commercial production (in respect of Fenix Gold); impact of the new truck fleet at the Fenix Gold mine and resolution of operator and truck availability issues; timing for, and impact of, high grading at the Fenix Gold mine; impact of equipment purchases on operations; commencement of mining at Fenix Central; projected gold recovery levels; results of Rio2’s efforts to hedge against rising fuel costs; timing and outcome of the desalinated water studies for Fenix Gold; capital expenditures at Fenix Gold through 2026; activities relating to the near-surface drilling program at Condestable, geological/structural mapping activities, and the magnetometry geophysical survey at Condestable, and the impacts and outcome of same; timing and anticipated outcome of pilot program at Condestable, including timing for related approvals; timing for an updated MRE report on Condestable; and other matters ancillary or incidental to the foregoing.

All statements included herein, other than statements of historical fact, may be forward-looking information and such information involves various risks and uncertainties. Forward-looking information is often, but not always, identified by the use of words such as “seek”, “anticipate”, “plan”, “continue”, “estimate”, “expect”, “may”, “will”, “project”, “predict”, “potential”, “targeting”, “intend”, “could”, “might”, “should”, “believe” and similar expressions. The forward-looking information is based on certain key expectations and assumptions made by Rio2’s management, including but not limited to: expectations concerning prevailing commodity prices, exchange rates, interest rates, applicable royalty rates and tax laws; capital efficiencies; legislative and regulatory environment of Chile and Peru; future mining and production rates and estimates of capital and operating costs; expectations regarding the availability of financing when needed; estimates of reserves and resources; anticipated timing and results of capital expenditures; the sufficiency of capital expenditures in carrying out planned activities; results of operations; performance; the anticipated timing and results of expansion studies and related approvals; the availability and cost of financing, labor and services; and Rio2’s ability to access capital on satisfactory terms.

Rio2 believes the expectations reflected in these forward-looking statements are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward-looking statements in this news release should not be unduly relied upon. A description of assumptions used to develop such forward-looking information and a description of risk factors that may cause actual results to differ materially from forward-looking information can be found in Rio2's most recent annual information form on the SEDAR+ website at www.sedarplus.ca. These risks and uncertainties include, but are not limited to: risks and uncertainties relating to market conditions, risks associated with our operations, and management’s ability to anticipate and manage the factors and risks referred to herein.

Forward-looking statements included in this news release are made as of the date of this news release and such information should not be relied upon as representing its views as of any date subsequent to the date of this news release. Rio2 has attempted to identify important factors that could cause actual results, performance or achievements to vary from those current expectations or estimates expressed or implied by the forward-looking information. However, there may be other factors that cause results, performance or achievements not to be as expected or estimated and that could cause actual results, performance or achievements to differ materially from current expectations. Rio2 disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as expressly required by applicable securities legislation.

To learn more about Rio2 Limited, please visit: www.rio2.com or Rio2's SEDAR+ profile at www.sedarplus.ca.

ON BEHALF OF THE BOARD OF RIO2 LIMITED

Alex Black
Executive Chairman of the Board
Email: alex.black@rio2.com
Tel: +51 99279 4655

Kathryn Johnson
Executive Vice President, CFO & Corporate Secretary
Email: kathryn.johnson@rio2.com
Tel: +1 604 762 4720

Legal Disclaimer:

EIN Presswire provides this news content "as is" without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the author above.