Long Term Mine Development And Exploration Program Will Support Future Production Potential

Catalysts

About G Mining Ventures

G Mining Ventures is a gold producer and developer with the operating TZ mine in Brazil and construction and exploration projects at Oko West in Guyana and Gurupi in Brazil.

What are the underlying business or industry changes driving this perspective?

• The TZ mine is operating with total cash costs of $748 per ounce and all in sustaining costs of $1,155 per ounce in 2025, which are described as peer leading. Management aims to keep focusing on productivity and cost management, which could help protect margins and earnings if industry wide cost pressures persist.
• The company reports strong free cash flow from TZ and expects this cash flow to fund a large part of Oko West construction and a record exploration budget of about $46 million across the portfolio. This could support future revenue and free cash flow if new resources and projects move into production.
• Oko West construction is already well advanced, with 42% of the total project budget committed and most major equipment procured and expected to be delivered in 2026. This reduces execution risk and may support future production growth and cash generation once the project transitions to commercial production.
• The Gurupi project has an existing resource base of 1.8 million ounces indicated and 0.8 million ounces inferred, with work underway toward an updated mineral resource estimate and PEA. This could surface additional project value and longer term production options that influence future revenue and earnings.
• The company is pursuing its largest exploration program to date across TZ, Oko West and Gurupi, including around 110 kilometers of drilling and work on new targets such as the Northwest expansion at Oko West and district scale trends at Gurupi. This activity could extend mine lives or support new mines and affect long term revenue and free cash flow profiles.

Assumptions

How have these above catalysts been quantified?

• Analysts are assuming G Mining Ventures's revenue will grow by 59.3% annually over the next 3 years.
• Analysts assume that profit margins will shrink from 49.6% today to 47.9% in 3 years time.
• Analysts expect earnings to reach $1.1 billion (and earnings per share of $4.91) by about April 2029, up from $287.9 million today.
• In order for the above numbers to justify the price target of the analysts, the company would need to trade at a PE ratio of 13.3x on those 2029 earnings, down from 29.0x today. This future PE is lower than the current PE for the CA Metals and Mining industry at 18.2x.
• Analysts expect the number of shares outstanding to grow by 5.1% per year for the next 3 years.
• To value all of this in today's terms, we will use a discount rate of 7.41%, as per the Simply Wall St company report.

Risks

What could happen that would invalidate this narrative?

• The business is heavily exposed to the gold price, with TZ fully unhedged and royalties directly tied to realized prices, so any prolonged period of weaker gold prices could reduce revenue, compress free cash flow margins and lower earnings.
• G Mining Ventures is entering peak spending years, with 2026 capital expenditures projected at $514 million to $568 million and a further $230 million in 2027, so any cost overrun, supplier delay or construction issue at Oko West could pressure cash flow, increase funding needs and weigh on future earnings.
• The long term growth story relies on bringing Oko West and Gurupi into production and growing resources through extensive drilling, so if exploration results do not translate into economic reserves or if project economics in the Gurupi PEA are weaker than hoped, future production potential and long term revenue could fall short of expectations.
• Royalty and tax costs at TZ already pushed total cash costs slightly above guidance in 2025, and a long term trend of rising government take, labor inflation or higher maintenance spending could steadily lift all in sustaining costs, which would erode net margins and reduce free cash flow even if production volumes are maintained.
• The company is concentrating a large amount of capital and operating effort in Brazil and Guyana, so any long term change in regulatory frameworks, permitting conditions, community relations or power availability in these jurisdictions could affect mine plans and ultimately impact revenue stability, cash costs and earnings.

Valuation

How have all the factors above been brought together to estimate a fair value?

• The analysts have a consensus price target of CA$60.69 for G Mining Ventures based on their expectations of its future earnings growth, profit margins and other risk factors.
• However, there is a degree of disagreement amongst analysts, with the most bullish reporting a price target of CA$68.0, and the most bearish reporting a price target of just CA$51.0.
• In order for you to agree with the analysts, you'd need to believe that by 2029, revenues will be $2.3 billion, earnings will come to $1.1 billion, and it would be trading on a PE ratio of 13.3x, assuming you use a discount rate of 7.4%.
• Given the current share price of CA$48.93, the analyst price target of CA$60.69 is 19.4% higher.
• We always encourage you to reach your own conclusions though. So sense check these analyst numbers against your own assumptions and expectations based on your understanding of the business and what you believe is probable.