Jaguar Mining Q3: Turmalina Pause Masks Underlying Growth Momentum

Despite the operational hiccup at Turmalina, Jaguar Mining demonstrated remarkable financial resilience in Q3 2025, delivering a $13.0 million net income and $8.2 million free cash flow. This strong performance was particularly notable given the 38% year-over-year drop in ounces sold to 9,799, caused by the Turmalina suspension initiated after a material slump in December 2024, as reported in a Morningstar report. The boost came primarily from a soaring 40% increase in the realized gold price to $3,465 per ounce, which more than offset the production dip stemming from the Turmalina shutdown, according to the Morningstar report.

Crucially, the company maintained focused investment in its high-grade Pilar asset. The Pilar mine produced 10,002 ounces in Q3 2025, operating at a solid 89% recovery rate and a head grade of 3.68 g/t, representing the sole source of production during the quarter, as noted in a Yahoo Finance report. This targeted focus on core assets, even amidst the Turmalina rehabilitation period expected to last until Q1 2026, underscores management's strategy to sustain cash flow and value during the temporary setback. While cost metrics rose due to lower volumes – cash operating costs reached $1,374 per ounce and all-in sustaining costs hit $2,063 per ounce, 25% and 13% higher YoY respectively – the underlying asset strength and market conditions preserved profitability, as the Yahoo Finance report notes.

The Turmalina suspension, while a significant operational challenge, is framed by Jaguar as a necessary realignment. The clean-sheet approach to addressing the dry-stack facility slump aligns with the "Growth Priority" stance, aiming to return the asset to full productivity with improved safety and efficiency once restarted in Q1 2026, as the Morningstar report explains. This disciplined handling of the outage, coupled with the strong financial results driven by Pilar and the gold

price environment, reinforces the view that the core asset remains highly productive and strategically positioned for future growth once Turmalina is fully operational again.

Jaguar Mining's strategic pivot is showing tangible results at its Pilar operation, where recovery metrics and cost efficiency are proving the resilience of its turnaround plan. While the suspension of the lower-margin Turmalina mine in late 2024 dragged down overall quarterly production, Pilar stepped up decisively, generating 10,002 ounces in Q3 2025 at a robust 89% recovery rate and a head grade of 3.68 g/t, as the Yahoo Finance report notes. This performance underscores the effectiveness of the company's focus on higher-quality assets, as Pilar's output more than compensated for Turmalina's absence, stabilizing the company's gold supply despite the 38% year-over-year drop in total ounces sold. Critically, Pilar's operational strength suggests significant margin improvement potential: the elevated all-in sustaining cost of $2,063 per ounce for Q3 2025 reflected the dilutive effect of spreading fixed costs over fewer total ounces, not inherent inefficiency at Pilar itself, as the Yahoo Finance report notes. As production volumes normalize and fixed costs are absorbed by higher output, Pilar's strong recovery rate and grade provide a clear pathway to reducing both cash operating and sustaining costs toward pre-2024 levels. While exploration drilling targets aren't detailed in the latest report, Pilar's current performance validates the strategic shift toward consolidating resources at higher-performing mines.

Despite gold's rally, Jaguar Mining's path to margin expansion hinges on resolving operational headwinds. The Turmalina mine's temporary suspension following a material slump in December 2024 directly squeezed unit economics, slashing Q3 2025 ounces sold by 38% compared to the prior year, as the Morningstar report notes. This volume drop forced fixed costs to spread over fewer ounces, directly driving the 25% year-over-year increase in cash operating costs to $1,374 per ounce and the 13% rise in all-in sustaining costs to $2,063 per ounce, as the Yahoo Finance report notes. While the Pilar mine remained productive-delivering 10,002 ounces at a solid 3.68 g/t head grade and 89% recovery-it wasn't enough to offset Turmalina's absence. The current cost structure, particularly the elevated all-in sustaining cost of over $2,000 per ounce, sets a high bar for the gold price to generate meaningful margin expansion once production normalizes. The reopening of Turmalina and potential grade improvements at Pilar will be critical inflection points for cost recovery and margin improvement.

The operational headwinds facing Jaguar Mining have created a significant valuation gap, but near-term catalysts are aligning to reset market expectations. The most concrete trigger is the planned restart of the Turmalina operation, currently suspended since December 2024 due to a material slump at its dry-stack facility; management projects resumption only in Q1 2026, as the Morningstar report notes. This timeline is critical, as Turmalina historically contributed substantially to annual output.

Parallelly, progress at the Pilar mine-Jaguar's primary current producer-is dictating near-term cash flow. Despite Turmalina's suspension slashing Q3 2025 production to just 10,002 ounces (from 16,912 ounces in Q3 2024) and denting sales by 38% YoY, Pilar's targeted investments are paying dividends, as the Yahoo Finance report notes. The mine's performance, combined with a 40% surge in the realized gold price to $3,465/oz, enabled Jaguar to report $13.0 million net income and $8.2 million free cash flow in Q3 2025, as the Morningstar report notes. Ongoing drilling at Pilar will define whether this strength sustains, with results expected to inform near-term production forecasts.

Gold price exposure amplifies this dynamic. Every $100/oz rise translates directly into materially higher margins given Jaguar's cost structure, creating asymmetric upside if prices hold near current levels. This sensitivity means even modest gold price stability could trigger re-rating, independent of operational recovery.

The falsifier here is clear: if Turmalina's Q1 2026 restart slips meaningfully or Pilar's drilling disappoints, the recovery thesis fractures. Operational delays would extend production shortfalls and cost inflation, while a gold price correction below $3,200/oz would erode the margin buffer propping up current profitability. The clock is ticking on both the operational roadmap and the commodity cycle.