Earnings release
Page 1
Hemlo Hemlo Mining Corp. 390 Bay Street , Suite 1720 Toronto , ON M5H 2Y2 www.hemlomining.com Hemlo Mining Corp. Reports Second Quarter 2026 Financial and Operating Results - Toronto , Ontario , Canada August 11 , 2026 Hemlo Mining Corp. ( TSX : HMMC ) ( OTCQX : HMMCF ) ( " Hemlo " or the " Company " ) is pleased to announce its financial and operating results for the second quarter ended June 30 , 2026 ( " Q2 " or " Q2 2026 " ) . The Company will host a conference call to discuss second quarter 2026 results on Wednesday , August 12 , 2026 at 11:00 AM Eastern Time . ( All amounts expressed in U.S. dollars unless otherwise stated ) Jason Kosec , President , CEO & Director of Hemlo Mining , commented : " Q2 demonstrated continued execution against our strategic priorities as we advanced our owner - operator transition and strengthened the operational foundations required to support higher long - term production rates . We delivered attributable gold production of 25,188 ounces , generating revenue of $ 142.5 million and net income of $ 31.0 million , or $ 0.10 per share . During the quarter , production was in line with our expectations while operational fundamentals strengthened meaningfully , positioning the business for improved performance as newly developed mining areas enter the production sequence . We also achieved several important strategic milestones , including a 34 % increase in Measured & Indicated Mineral Resources , graduation to the Toronto Stock Exchange , completion of an Impact Benefit Agreement with Biigtigong Nishnaabeg , and three consecutive years without a lost - time injury . The progress we have made during the first half of 2026 reinforces our confidence in the significant long- term value creation opportunity at Hemlo . " Second Quarter Highlights : Financial Highlights • • • • • Revenue for the three months ended June 30 , 2026 was $ 142.5 million , mainly from 32,425 gold ounces sold at an average realized price of $ 4,467 per ounce . Revenue for the six months ended June 30 , 2026 was $ 328.8 million mainly from 71,110 gold ounces sold at an average realized price of $ 4,710 per ounce . Net income for the three months ended June 30 , 2026 was $ 31.0 million , or $ 0.10 per share , and adjusted net income¹ was $ 27.3 million , or $ 0.09 per share¹ . Net income for the six months ended June 30 , 2026 was $ 53.1 million , or $ 0.18 per share , and adjusted net income¹ was $ 76.0 million , or $ 0.26 per share¹ . Earnings before interest , taxes , depreciation and amortization ( " EBITDA " ) 1 for the three months ended June 30 , 2026 was $ 77.2 million . EBITDA¹ for the six months ended June 30 , 2026 was $ 163.8 million . Cash generated from operating activities for the three and six months ended June 30 , 2026 was $ 35.6 million and $ 123.5 million , respectively . As at June 30 , 2026 , the Company held cash of $ 130.2 million . 1 This is a non - IFRS measure . For further information , refer to the " Non - IFRS Measures " section of this news release . 1
Page 2
Operating Highlights • Attributable gold2 production for the three and six months ended June 30, 2026 totalled 25,188 and 54,887 ounces of gold, respectively, at average recoveries of 94.3% and 95.0%, respectively. • Attributable gold2 sold for the three and six months ended June 30, 2026 totalled 27,858 and 59,910 ounces of gold, respectively, supplemented by finished goods at the beginning of each period. • Cost of sales for the three and six months ended June 30 , 2026 were $96.8 million and $210.0 million, respectively. Site attributable cash cost per ounce sold 3 for the three and six months ended June 30, 2026 was $1,880 and $1,615, respectively, and all-in sustaining cost ("AISC") per ounce sold3 for the three and six months ended June 30, 2026 was $2,561 and $2,157, respectively. • Continued strong safety and environmental performance in the second quarter, recording no environmental non-compliance and no lost-time injuries ("LTI") while achieving three consecutive years without a LTI. • Strengthened operational metrics during the quarter, including development metres increased 42%, longhole production drilling rose 65%, total tonnes moved improved 5%, and ore milled increased 7% compared with the first quarter of 2026. • Established several new daily operating records in the second quarter of 2026, including 1,051 metres of longhole drilling, 46 metres of lateral development, 4,800 tonnes of paste backfill placed, 7,118 tonnes of ore hoisted, and 5,035 tonnes of ore processed. • Received seven additional mobile equipment units during the quarter, bringing total deliveries to 10 of 21 planned units. • Announced an updated Mineral Resource Estimate ("MRE") demonstrating a 34% increase from the 2025 National Instrument 43-101, Standards of Disclosure for Mineral Projects ("NI 43-101") Technical Report (the "2025 Report"), adding 1.2 million ounces of gold, in Measured and Indicated ("M&I") Mineral Resources (100% basis). • Continued to advance the 130,000 metre exploration drilling program with initial results from the South-Rim Zone that support the definition of a newly recognized, high-grade mineralized domain. Corporate Highlights • Common shares commenced trading on the OTCQX® Best Market ("OTCQX") in the United States under the symbol "HMMCF" and became eligible for electronic clearing and settlement in the United States through the Depository Trust Company ("DTC"). • Completed an Impact Benefit Agreement ("IBA") with Biigtigong Nishnaabeg ("BN") in relation to the Hemlo Mine. • Graduated to the Toronto Stock Exchange ("TSX") from the TSX Venture Exchange ("TSXV"). • Appointed Eva Koci as an independent director on the Company's Board of Directors ("Board"), increasing the Board to seven directors, a majority of whom are independent. 2 2 Attributable gold is calculated as 100% of gold from Williams and 50% of gold from Interlake. 3 This is a non-IFRS measure. For further information, refer to the "Non-IFRS Measures" section of this news release.
Page 3
Operating and Financial Highlights Three months ended Three months ended Six months ended Hemlo Mine Unit June 30, 2026 March 31, 2026 June 30, 2026 Williams Ore mined 000t 266 229 495 Waste mined 000t 68 45 113 Total mined 000t 334 274 608 Ore processed 000t 283 230 513 Average grade g/t Au 2.53 3.37 2.90 Gold produced oz. 22,516 24,635 47,151 Sustaining capital expenditures1 $'000s 17,048 11,018 28,066 Growth capital expenditures1 $'000s 6,857 7,688 14,545 Interlake2 Ore mined2 000t 59 91 150 Waste mined2 000t 3 11 14 Total mined2 000t 62 102 164 Ore processed2 000t 61 92 153 Average grade2 g/t Au 3.05 3.51 3.33 Gold produced2 oz. 5,342 10,129 15,471 Sustaining capital expenditures1,2 $'000s 370 1,367 1,737 Total ore processed 000t 344 322 666 Recovery % 94.3 95.6 95.0 Total gold produced oz. 27,858 34,764 62,622 Total gold sold oz. 32,425 38,685 71,110 Attributable gold produced3 oz. 25,188 29,699 54,887 Attributable gold sold3 oz. 27,858 32,052 59,910 Unit Cost Analysis Average realized price1 $/oz. sold 4,467 4,923 4,710 Mining $/t mined 105.60 113.15 109.28 Milling $/t milled 25.50 32.81 29.03 Minesite G&A $/t milled 26.84 20.75 23.90 Cost of sales (100%) $/oz. sold 2,987 2,924 2,953 Total site cash cost (Attributable)1 $/oz. sold 1,880 1,385 1,615 Total site AISC (Attributable)1 $/oz. sold 2,561 1,805 2,157 1. This is a non-IFRS measure. For further information, refer to the "Non-IFRS Measures" section of this news release. 2. Operating statistics are presented on a 100% basis. The Interlake claims are subject to a 50% net profits interest ("NPI") royalty with Franco-Nevada Corporation. 3. Attributable gold is calculated as 100% of gold from Williams and 50% of gold from Interlake. 3
Page 4
Three months ended June 30, Six months ended June 30, 2025 2025 Summary of financial information Unit 2026 (restated)3 2026 (restated)3 Gold produced (100%) oz. 27,858 — 62,622 — Gold produced (attributable)1 oz. 25,188 — 54,887 — Gold sold (100%) oz. 32,425 — 71,110 — Gold sold (attributable)1 oz. 27,858 — 59,910 — Average realized price2 $/oz. sold 4,467 — 4,710 — Revenue $'000s 142,499 — 328,764 — Cost of sales $'000s 96,842 — 209,971 — General and administrative expenses $'000s 6,972 36 14,879 49 Exploration and evaluation expenditures $'000s 204 — 275 — Foreign exchange losses (gains) $'000s 226 (1) (551) (1) Other (income) expenses $'000s (12,066) 32 (4,320) 32 Income (loss) from operations $'000s 50,321 (67) 108,510 (80) Finance costs, net $'000s 7,207 — 19,637 — Income (loss) before income taxes $'000s 43,114 (67) 88,873 (80) Income tax expense $'000s 12,112 — 35,745 — Net income (loss) $'000s 31,002 (67) 53,128 (80) Basic earnings (loss) per share $/share 0.10 (0.02) 0.18 (0.02) Adjusted net income (loss)2 $'000s 27,292 (67) 76,040 (80) Adjusted basic earnings (loss) per share2 $/share 0.09 (0.02) 0.26 (0.02) Cash generated from (used in) operating activities $'000s 35,648 (61) 123,547 (86) Cash flow generated from (used in) operating activities before working capital changes2 $'000s 34,308 (67) 88,735 (80) Cash used in investing activities $'000s 24,359 — 40,766 — 1. Attributable gold is calculated as 100% of gold from Williams and 50% of gold from Interlake. 2. This is a non-IFRS measure. For further information, refer to the "Non-IFRS Measures" section of this news release. 3. As at December 31, 2025 , the Company changed its presentation currency from Canadian dollars to U.S. dollars. The change in presentation currency is an accounting policy change and has been applied retrospectively with comparative figures restated for all periods presented. As at June 30, As at December 31, Financial position Unit 2026 2025 Cash $'000s 130,152 131,956 Net debt1 $'000s 19,848 93,044 Working capital $'000s 51,075 110,688 1. This is a non-IFRS measure. For further information, refer to the "Non-IFRS Measures" section of this news release. 4
Page 5
Financial Overview Revenue for the three months ended June 30 , 2026 was $142.5 million , mainly from 32,425 gold ounces sold at an average realized price 4 of $4,467 per ounce. Revenue decreased compared to the first quarter of 2026 due to 6,260 fewer gold ounces sold and $456 per ounce decrease in average realized price4. Cost of sales for the three months ended June 30, 2026 was $96.8 million. Cost of sales decreased compared to the first quarter of 2026 mainly due to lower royalties expense of $16.3 million from lower revenues as well as lower gold ounces sold from the Interlake claims which are subject to a 50% net profit interest royalty ("NPI") with Franco-Nevada Corporation ("Franco-Nevada"). Other income for the three months ended June 30, 2026 was $12.1 million, mainly comprised of gains of $20.7 million from change in fair value of contingent consideration, and gains of $7.4 million from change in fair value of gold derivative financial instruments , partially offset by $15.8 million paid within the terms of an IBA with one of the First Nations in relation to the Hemlo Mine. Finance costs, net for the three months ended June 30, 2026 was $7.2 million. Finance cost decreased compared to the first quarter of 2026 mainly due to repayment of the Revolving Credit Facility in March 2026 resulting in a decrease of interest expense of $2.6 million as well as reduction in accretion of the Precious Metals Purchase Agreement with Wheaton Precious Metals Corp. ("Wheaton") of $3.0 million. Income tax expense for the three months ended June 30, 2026 was $12.1 million. Income tax expense decreased compared to the first quarter of 2026 mainly due to lower revenues. The decrease in effective tax rate in the second quarter of 2026 compared to the first quarter of 2026 was primarily driven by non-taxability of $20.7 million gain on change in fair value of Contingent Consideration in the second quarter of 2026 compared to the non-deductibility of $8.4 million loss on change in fair value of Contingent Consideration in the first quarter of 2026. Net income for the three months ended June 30, 2026 was $31.0 million, an increase of $8.9 million compared to the first quarter of 2026, mainly due to lower income tax expense of $11.5 million, increase in gain on change in fair value of Contingent Consideration of $29.1 million, increase in gain on change in fair value of gold derivative financial instruments of $6.7 million, lower finance cost of $5.5 million mainly driven by lower interest expense and gold stream accretion, partially offset by lower gross profit 5 of $27.5 million from lower gold ounces sold and average realized price per ounce 5 and $15.8 million paid in relation to an IBA. Cash generated from operating activities for the three months ended June 30, 2026 was $35.6 million, a decrease of $52.3 million compared to the first quarter of 2026. The decrease was mainly driven by lower revenues and timing of cash proceeds of $14.8 million from 3,721 gold ounces sold at the end of the second quarter of 2026. 5 4 This is a non-IFRS measure. For further information, refer to the "Non-IFRS Measures" section of this news release. 5 Calculated as revenue less cost of sales as disclosed in the interim condensed consolidated statements of income (loss).
Page 6
Cash used in investing activities for the three months ended June 30, 2026 was $24.4 million, mainly related to sustaining capital expenditures 6 of $17.5 million driven by spending on underground mine development and infrastructure, mining fleet additions and tailings storage facility, with growth capital expenditures6 of $6.9 million largely reflecting mining fleet additions and exploration drilling. Increase in cash used in investing activities compared to the first quarter of 2026 was mainly due to timing of payments related to capital expenditures and $4.6 million in cash consideration recovered due to the settlement of the working capital adjustment from the acquisition of the Hemlo Mine (the "Hemlo Acquisition"). Operations Overview Safety and Workforce The Hemlo Mine continued its strong safety and environmental performance in the second quarter of 2026, recording no environmental non-compliance and no LTIs while achieving three consecutive years without a LTI. The second quarter of 2026 marked Hemlo's first full quarter operating as an owner-operator, representing the first time the Hemlo Mine has operated under this model since 2019. Recruiting and training efforts progressed well during the second quarter of 2026, and the Hemlo Mine now employs 529 full-time employees alongside 265 contractors , approximately 75% of whom are from local communities. Mining and Processing During the second quarter of 2026, mining rates at the Hemlo Mine increased modestly, resulting in 396,000 total tonnes mined, including 325,000 ore tonnes and 71,000 waste tonnes. The Hemlo Mine processed 344,000 tonnes of ore in the second quarter of 2026, an increase of 7% from 322,000 tonnes of ore in the first quarter of 2026, and 666,000 tonnes of ore for the six months ended June 30, 2026. This equates to average throughput of approximately 3,800 tonnes per day in the second quarter of 2026, an increase from approximately 3,600 tonnes per day in the first quarter of 2026, representing a modest utilization of the processing plant's 10,000 tonne-per-day nameplate capacity. During the second quarter of 2026, the mill set a new daily processing record of 5,035 tonnes of ore, underscoring the additional capacity available within the existing processing circuit. Recovery for the second quarter of 2026 was 94.3%, compared with 95.6% in the first quarter of 2026 and 95.0% for the six months ended June 30, 2026, reflecting the change in ore blend as lower-grade development tonnes from Williams and Interlake contributed a larger share of mill feed. The Hemlo Mine produced 25,188 attributable gold7 ounces in the second quarter of 2026, a decrease of 4,511 ounces compared to 29,699 attributable gold 7 ounces in the first quarter of 2026. The decline was primarily driven by a planned rebuild of one of the three underground crushers, which required all tonnage to be diverted to the remaining two crushers, together with a planned transition from a top- down to bottom-up mining sequence across portions of the Williams and Interlake zones to reduce 6 6 This is a non-IFRS measure. For further information, refer to the "Non-IFRS Measures" section of this news release. 7 Attributable gold is calculated as 100% of gold from Williams and 50% of gold from Interlake.
Page 7
waste handling and improve long-term mining efficiency. The sequencing change temporarily delayed access to higher-grade stopes and increased the proportion of lower-grade development ore processed during the second quarter of 2026, reducing average mill feed grade to 2.53 grams per tonne ("g/t") of gold ("Au") at Williams and 3.05 g/t Au at Interlake compared to 3.37 g/t Au and 3.51 g/t Au, respectively, in the first quarter of 2026. However, because the incremental lower-grade tonnes were sourced from wholly-owned areas of the Hemlo Mine, attributable gold production represented a higher percentage of total gold production than in the first quarter of 2026. Underlying operating metrics improved materially during the second quarter of 2026, notwithstanding the lower grade profile. Development metres increased 42%, longhole production drilling increased 65%, total tonnes moved increased 5%, and ore milled increased 7% relative to the first quarter of 2026. Management expects these leading indicators to support improved production in future periods as newly developed mining areas are brought into the production sequence. Seven additional mobile equipment units were delivered during the second quarter of 2026, including three bolters, one scissor lift, one 45-tonne haul truck, and two 11-cubic-yard scooptrams, bringing the fleet to 10 of 21 planned new units on site for 2026. Together with planned ventilation upgrades expected to improve blast re-entry times in the second half of 2026, these investments are expected to support higher development rates and greater production flexibility. During the quarter, the Hemlo Mine also successfully managed a significant spring thaw and snow melt without operational disruption. Operating Costs Mining unit costs, before capitalized development costs, decreased to $105.60 per tonne mined in the second quarter of 2026, from $113.15 per tonne in the first quarter of 2026, while milling costs decreased to $25.50 per tonne milled from $32.81 per tonne, reflecting higher mining and processing volumes. Mine site G&A increased to $26.84 per tonne milled from $20.75 per tonne, primarily reflecting the continued build-out of the owner-operator workforce. Attributable gold 8 sold for the three months ended June 30 , 2026 was 27,858 ounces, resulting in cash costs per ounce sold 9 of $1,880 and attributable AISC per ounce sold 9 of $2,561 compared with $1,385 and $1,805, respectively, in the first quarter of 2026. The increases primarily reflect lower attributable gold 8 ounces sold, over which fixed and semi-fixed costs were spread, continued investment in the mobile fleet and owner-operator transition, and additional labour to support the planned ramp-up to 4,800 tonnes per day by the end of 2026. Operating costs also continued to be affected by the highly competitive market for skilled labour, elevated consumable prices, including diesel fuel, and the impact of tariffs on parts and equipment. Given the Hemlo Mine's processing plant spare capacity relative to nameplate throughput, unit milling costs are expected to decline as underground production increases, reflecting the ability to spread the plant's largely fixed cost base over a greater number of processed tonnes. 7 8 Attributable gold is calculated as 100% of gold from Williams and 50% of gold from Interlake. 9 This is a non-IFRS measure. For further information, refer to the "Non-IFRS Measures" section of this news release.
Page 8
Capital Expenditures During the second quarter of 2026, sustaining capital expenditures 10 totalled $17.5 million , mainly comprised of $9.0 million in underground development expenditures, $3.6 million for mobile equipment and $1.4 million for tailings storage facility. During the second quarter of 2026, growth capital expenditures10 totalled $6.9 million, mainly comprised of $2.7 million in exploration drilling, $1.9 million for mobile equipment and $1.3 million for processing plant improvements. 2026 Mineral Resource Estimate Update In June 2026, the Company announced an updated MRE for the Hemlo Mine which incorporated additional drilling completed since the last MRE in the 2025 Report, as well as updated underlying assumptions to reflect current metal prices. The MRE advances the Company's multi-year strategy to expand Mineral Resources and Mineral Reserves ("MRMR"), extend mine life, optimize mining operations, and enhance long-term shareholder value. Highlights of the updated MRE include: • M&I Mineral Resources (100% basis) of 96.9 million tonnes ("Mt") at 1.55 g/t Au for 4.8 million ounces ("Moz") of gold; represents an increase of 1.2 Moz, or +34%, compared to the 2025 Report. ◦ Underground: 24.9 Mt at 3.53 g/t Au for 2.8 Moz (+40% vs. 2025 Report) ◦ Open Pit: 71.9 Mt at 0.87 g/t Au for 2.0 Moz (+25% vs. 2025 Report) • Inferred Mineral Resources (100% basis) of 12.1 Mt at 2.22 g/t Au for 0.9 Moz Au; represents an increase of 242,000 oz, or +39%, compared to the 2025 Report. ◦ Underground: 8.1 Mt at 3.03 g/t Au for 0.8 Moz (+48% vs. 2025 Report) ◦ Open Pit: 4.0 Mt at 0.57 g/t Au for 0.1 Moz (-17% vs. 2025 Report) ◦ "A-Zone" (newly identified by the Company's Lead Director, Dr. Robert Quartermain) included in the Inferred MRE; 635,000 tonnes at 3.43 g/t Au for 70,000 oz Au; extends from surface to ~120 metres ("m") depth and is actively being drilled by two surface rigs, offering significant exploration potential. • The MRE represents an important milestone toward a comprehensive MRMR update and technical report targeted for the second half of 2027. Future MRMR conversion is expected to be supported by geotechnical studies, tailings facility upgrades, pit shell optimization and trade-off studies, mine planning updates, and updated economic assumptions. 8 10 This is a non-IFRS measure. For further information, refer to the "Non-IFRS Measures" section of this news release.
Page 9
Updated Mineral Resource Estimate with an Effective Date of December 31, 2025 Mineral Resources Measured Indicated Measured & Indicated Inferred Tonnes Grade Cont. Tonnes Grade Cont. Tonnes Grade Cont. Tonnes Grade Cont. (kt) (g/t Au) (koz Au) (kt) (g/t Au) (koz Au) (kt) (g/t Au) (koz Au) (kt) (g/t Au) (koz Au) Open Pit 0 0.00 0 71,923 0.87 2,009 71,923 0.87 2,009 3,988 0.57 73 Underground (ex. Interlake) 5,095 3.40 557 13,676 3.42 1,502 18,771 3.41 2,059 5,810 2.81 525 Interlake Claims 2,085 4.10 275 4,087 3.80 499 6,172 3.90 774 2,330 3.58 268 Total Underground 7,180 3.60 832 17,763 3.50 2,000 24,943 3.53 2,832 8,140 3.03 793 Total 7,180 3.60 832 89,686 1.39 4,009 96,866 1.55 4,841 12,128 2.22 866 Less: 50% Interlake 1,042 4.10 137 2,044 3.80 249 3,086 3.90 387 1,165 3.58 134 Total Attributable 6,137 3.52 694 87,643 1.33 3,760 93,780 1.48 4,454 10,963 2.08 732 Notes: 1. MRE has been prepared according to CIM (2014) Standards and using CIM (2019) MRMR Best Practice Guidelines. 2. Open Pit Mineral Resources are reported inside an economic pit shell generated using Datamine Studio NPVS software. Underground Mineral Resources are constrained within stope shapes generated by Deswik Stope Optimizer. 3. Open Pit Mineral Resources are reported using a gold cut-off grade of 0.28 g/t. Underground Mineral Resources are reported on a diluted basis using a gold cut-off grade of 1.8 g/t. 4. Both Underground and Open Pit Mineral Resources are estimated using a long-term gold price of US$2,500/oz. 5. A constant specific gravity ("SG") value of 2.72 has been applied to all blocks in the model. Waste dump material is assigned an SG of 2.05 and underground back fill material a 1.89 density. 6. Mineral Resources have been depleted to December 31, 2025 using the mined-out surfaces and voids. 7. Mineral Resources are inclusive of Mineral Reserves. Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability. 8. Numbers may not add due to rounding. 9. The qualified person ("QP") responsible for this Mineral Resource Estimate is Mr. Brian Hartman (P. Geo.) of SLR Consulting (Canada) Ltd. The QP is not aware of any environmental, permitting, legal, title, taxation, socio-economic, marketing, political, or other relevant factors that could materially affect the MRE. 10. Interlake claims are subject to a 50% NPI royalty with Franco-Nevada. Attributable gold is calculated as 100% of gold from underground areas excluding Interlake and 50% of gold from Interlake. Refer to the Company's news release dated June 25, 2026 for details on the updated MRE. Drilling and Exploration The Company is currently executing an approximately 130,000 m drilling program. Year-to-date, approximately 60,000 m have been completed, with drilling activities now fully ramped up and a total of ten drill rigs on site, including three surface drills. The program is designed to support ongoing mining activities, resource conversion and resource expansion objectives while continuing to test the exploration opportunities highlighted by the Company's recent drilling success. The 2026 conversion drilling program targets areas of Inferred Mineral Resources as well as areas with potential to be converted into the Indicated category, offering additional Mineral Resource growth opportunities. The Company believes the opportunities highlighted by the MRE represent only a portion of the broader potential of the Hemlo Gold Mine and surrounding camp. Results from the ongoing 130,000-metre drilling program, continued geological reinterpretation, operational initiatives and future mine planning studies are expected to form the foundation of a comprehensive Mineral Resource and Mineral Reserve update targeted for the second half of 2027. That update is expected to incorporate the results of one of the largest exploration programs in the history of the Hemlo Gold Mine and surrounding camp and further refine the Company's long-term vision for the asset, supporting future mine planning, resource conversion and continued growth opportunities across the operation. 9
Page 10
Drilling Program Breakdown and Results Resource Conversion Drilling (70,000 metres): Targeting the conversion of Inferred to Indicated mineral resources to support reserve growth ahead of the updated technical study planned for the second half of 2027. Drilling is focused on multiple areas across the mine, with particular emphasis on the western portion of the operation — including C-Zone and the newly defined E-Zone — where significant Inferred Mineral Resources remain open at depth. Mineralization proximal to historic workings represents an additional conversion opportunity, with successful conversion expected to extend mine life, increase operational flexibility, and improve mine economics. High-Definition Drilling (30,000 metres): Focused on de-risking the short-term mine plan over the next two years by applying tighter drill spacing in areas scheduled for extraction within the next 24 months. The objective is to improve geological confidence, refine grade and tonnage estimates, and enhance operational predictability during the planned production ramp-up period. Growth Drilling (30,000 metres): Testing new mineralized zones outside the current mineral resource footprint across four priority targets selected based on geological interpretation, structural continuity, proximity to existing infrastructure, and mineability. These targets have returned encouraging historical results but have not been systematically tested. Successful results are expected to support the addition of new Inferred Mineral Resources, with promising intercepts to be followed up immediately with targeted infill drilling to advance mineralization toward the Indicated category and reinforce the long- term scale potential of the Hemlo gold system. During the second quarter of 2026, the Company announced the first results from the Growth Drilling component of its 2026 exploration program, focused on the South-Rim Zone – a newly recognized high- grade mineralized domain hosted within the regional metasediments and located adjacent to active mining in C-Zone. The first 7 of 20 planned holes confirmed mineralization, with highlights including: • Hole 7652606 intersected 16.07 g/t Au over 8.1 metres, including 59.67 g/t Au over 2.0 metres • Hole 7652603 intersected 5.79 g/t Au over 11.0 metres, including 38.40 g/t Au over 0.9 metres • Hole 7652604 intersected 6.04 g/t Au over 4.8 metres, including 36.20 g/t Au over 0.6 metres The mineralization remains open along strike and down plunge. Refer to the Company's news release dated May 14, 2026 for detailed drill results, images, and commentary. The Company will continue to release results from the drilling program throughout the remainder of 2026 and into 2027 as they become available. Corporate Updates On April 23, 2026, the Company announced that its common shares commenced trading on the OTCQX in the United States under the symbol "HMMCF". The OTCQX provides U.S. and international investors with a streamlined, cost-effective means of trading Hemlo's common shares through existing 10
Page 11
U.S. brokerage accounts and forms a key component of Hemlo's broader capital markets strategy to enhance trading liquidity and expand investor access. On June 4, 2026, the Company announced its wholly-owned subsidiaries, HMOC and Williams Operating Corporation, completed an IBA with BN in relation to the Hemlo Mine. The IBA includes mechanisms for financial participation, contracting and employment opportunities, capacity funding for a range of community priorities, as well as mechanisms for discussing environmental and other implementation matters. The IBA provides a structured framework for the life of the mine. On June 10, 2026, the Company announced that it received final approval to list its common shares on the TSX and graduate from the TSXV. The Company's common shares commenced trading on the TSX as of the opening of the market on June 15, 2026 under the existing trading symbol, "HMMC". In conjunction with the graduation onto the TSX, the Company's common shares were delisted from the TSXV, effective as of the close of market on June 12, 2026. On June 22, 2026, the Company appointed Eva Koci, an experienced capital markets executive, to serve as an independent director on the Company's Board of Directors. The Board now consists of seven directors, a majority of whom are independent. In line with Ms. Koci's appointment to the Board of Directors, committee roles were adjusted, such that each of the Audit Committee, Compensation Committee and Nominating and Governance Committee are comprised solely of independent directors. Financial Statements and Management's Discussion and Analysis Hemlo's unaudited interim condensed consolidated financial statements and management's discussion and analysis as at and for the three and six months ended June 30 , 2026, are available on the Company's website at www.hemlomining.com and under the Company's profile on SEDAR+ at www.sedarplus.ca. Hard copies of the financial statements are available free of charge upon written request to info@hemlomining.com. Conference Call and Webcast Hemlo will host a conference call and webcast on Wednesday, August 12, 2026 at 11:00 AM Eastern Time to discuss second quarter 2026 results. Details for the conference call and webcast are included below. Dial-In Numbers / Webcast: Conference/Meeting ID: 529206668 North America Toll Free: +1 833-461-5787 International Toll: +1 585-542-9983 Canada Local: +1 365-657-4084 Webcast: https://events.q4inc.com/attendee/529206668 11
Page 12
About Hemlo Mining Corp. Hemlo Mining Corp. is a Canadian gold producer focused on operating and enhancing the Hemlo gold camp in northwestern Ontario. The Company's flagship asset, the Hemlo Gold Mine, has produced approximately 25 million ounces of gold since 1985 from both underground and open pit operations. The Company's fit-for-purpose strategy is centered on maximizing the value of the mine through improved operating efficiency, production growth, and mine life extension. Hemlo Mining is led by an experienced team with a track record of value creation in the global mining sector. Contact Information Jason Kosec, President, CEO and Director, +1 (250) 552-7424 Jonathan Awde, Executive Chairman, +1 (604) 761-5251 General Inquiries: info@hemlomining.com Qualified Person The scientific and technical information contained in this news release has been reviewed and approved by Mike Tsafaras, P.Eng., the Company's Vice President, Engineering and Projects. Mr. Tsafaras is a "qualified person" as defined in NI 43-101. The scientific and technical information in this news release relating to the updated MRE has been reviewed and approved by Dr. Raphael Dutaut, Ph.D., P.Geo., the Company's Vice President, Exploration of Hemlo Mining Corp., who is a "Qualified Person" as defined by NI 43-101. Mr. Brian Hartman, P.Geo., of SLR Consulting (Canada) Ltd., Denver, Colorado, is an independent Qualified Person for the mineral resource estimate disclosed herein, as defined by NI 43-101, and has reviewed and approved the updated MRE with an effective date of December 31, 2025. In connection with his review, Mr. Hartman has conducted multiple site visits to the Hemlo Mine (most recently on January 19, 2026), reviewed drilling, logging, sampling, and sample shipment procedures with site personnel, evaluated assay and QA/QC results, and reviewed supporting documentation, including drill hole location data, orientation surveys, significant assay interval calculations, geological three-dimensional models, and mineral resource interpolation parameters. Mr. Hartman also reviewed the assumptions used to establish reasonable prospects for eventual economic extraction, as required under NI 43-101, for the purposes of mineral resource estimation. Scientific and Technical Information Scientific and technical information relating to the Hemlo Mine, other than the updated MRE, is available in the Company's technical report titled "NI 43-101 Technical Report Hemlo Mine, Ontario, Canada" with an effective date of December 31, 2024 and a signature date of October 27, 2025, and the Company's news release dated January 26, 2026, copies of which have been filed on the Company's SEDAR+ profile at www.sedarplus.ca. 12
Page 13
Forward-looking Statements This document contains certain forward-looking information and forward-looking statements within the meaning of applicable securities legislation (collectively "forward-looking statements"). The use of words such as "expects", "anticipates", "plans", "will", "may", "should" and similar expressions are intended to identify forward-looking statements. Forward-looking statements contained in this news release include statements regarding: the Company's key operational priorities for 2026; the Company's expectation that it will provide an updated Mineral Reserve estimate and life-of-mine plan in the second half of 2027; the Company's expectation that its 2026 drilling program will serve as the foundation for an updated technical report, expected to be released in the second half of 2027; the Company's plan to continue to release results from the drilling program throughout the remainder of 2026 and into 2027 as they become available; the Company's expectation that successful conversion drilling will contribute to mine life extension, increased operational flexibility and improved overall mine economics; the Company's expectation that successful growth drilling will support the addition of new Inferred Mineral Resources; the Company's operational plans, including mine fleet upgrades, ventilation upgrades, workforce training, and production optimization initiatives, and the expectation that they will support improved production performance, blast re-entry times, development rates, production flexibility and operating efficiency; and the Company's goals, plans, commitments, objectives and strategies. These forward-looking statements are provided as of the date of this news release, or the effective date of the documents referred to in this news release, as applicable, and reflect predictions, expectations or beliefs regarding future events based on the Company's beliefs at the time the statements were made, as well as various assumptions made by and information currently available to the Company. In making the forward-looking statements included in this news release , the Company has applied several material assumptions, including, but not limited to: the successful integration of the Hemlo Mine; the future price of gold; anticipated costs and the Company's ability to fund its programs; the Company's ability to carry on exploration, development, and mining activities; currency exchange rates remaining as estimated; prices for energy inputs, labour, materials, supplies and services remaining as estimated; the timing and results of operational plans; mineral reserve and mineral resource estimates and the assumptions on which they are based; the timely receipt of required approvals and permits; the timing of cash flows; the costs of operations; the Company's ability to operate in a safe, efficient, and effective manner; the Company's ability to attract and retain qualified personnel; the Company's ability to obtain financing as and when required and on reasonable terms; that the Company's activities will be in accordance with the Company's public statements and stated goals; and that there will be no material adverse change or disruptions affecting the Company or the Hemlo Mine. Consequently, there can be no assurances that such statements will prove to be accurate and actual results and future events could differ materially from those anticipated in such statements. We caution readers not to place undue reliance on these forward-looking statements. Forward-looking statements involve significant known and unknown risks and uncertainties, which could cause actual results to differ materially from those anticipated. These risks include, but are not limited to: uncertainty and variations in the estimation of mineral resources and mineral reserves; risks related to the Company's anticipated indebtedness and gold stream obligations; risks related to exploration, development, and operation activities; risks associated with the transition to an owner-operator model; risks related to the recruitment, training and retention of qualified personnel; equipment delivery, commissioning and operational performance risks; political risks, delays in obtaining or failure to obtain 13
Page 14
governmental permits, or non-compliance with permits; environmental and other regulatory requirements; uncertainties related to title to mineral properties; water rights; risks related to natural disasters, terrorist acts, health crises, and other disruptions and dislocations; financing risks and access to additional capital; risks related to guidance estimates and uncertainties inherent in the preparation of pre-feasibility studies; uncertainty in estimates of production, capital, and operating costs and potential production and cost overruns; the fluctuating price of gold; unknown liabilities in connection with the acquisition of the Hemlo Mine; global financial conditions; uninsured risks; climate change risks; competition from other companies and individuals; conflicts of interest; volatility in the market price of the Company's securities; the Company's limited operating history; litigation risks; the Company's ability to successfully integrate the acquisition of the Hemlo Mine; intervention by non-governmental organizations; outside contractor risks; risks related to historical data; risks related to the Company's accounting policies and internal controls; shareholder activism; other risks associated with executing the Company's objectives and strategies; and other risks set forth in the section entitled "Risk Factors" in the Company's Annual Information Form for the year ended December 31, 2025 filed with applicable Canadian securities regulatory authorities on April 15, 2026. Except as required by the securities disclosure laws and regulations applicable to the Company, the Company undertakes no obligation to update these forward-looking statements if management's beliefs, estimates or opinions, or other factors, should change. Non-IFRS Measures The Company has included certain non-IFRS measures in this news release, as detailed below. In the mining industry, these are common performance measures and ratios; however, they may not be comparable to similar measures or ratios presented by other issuers and the non-IFRS measures and ratios do not have any standardized meaning. Accordingly, these measures and ratios are included to provide additional information and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS Accounting Standards. These measures do not have any standardized meaning prescribed under IFRS Accounting Standards, and therefore may not be comparable to other issuers. Cash flow from operating activities before working capital changes Cash flow from operating activities before working capital changes is a non-IFRS performance measure that is calculated as net cash used in operating activities, excluding changes in working capital. The Company believes that this measure is useful to users in understanding whether changes in operating cash flows were due to operations or timing differences. 14
Page 15
Cash flow from operating activities before working capital changes reconciled to the amounts included in the interim condensed consolidated statements of cash flows as follows: Three months ended June 30, Six months ended June 30, 2025 2025 2026 (restated) 2026 (restated) Cash generated from (used in) operating activities $ 35,648 $ (61) $ 123,547 $ (86) Changes in working capital 1,340 6 34,812 (6) Cash flow generated from (used in) operating activities before working capital changes $ 34,308 $ (67) $ 88,735 $ (80) Net debt Net debt is a non-IFRS performance measure that is calculated as principal amounts of borrowings, as presented in the notes to the interim condensed consolidated financial statements, less cash as presented in the interim condensed consolidated statements of financial position. The Company believes that this measure is useful to users in understanding the Company's financial leverage and liquidity. As at June 30, As at December 31, 2026 2025 Term Facility $ 150,000 $ 150,000 Revolving Credit Facility — 75,000 Cash (130,152) (131,956) Net debt $ 19,848 $ 93,044 Cash costs and cash costs per ounce sold Cash costs and cash costs per ounce sold are non-IFRS measures. In the gold mining industry, these metrics are common performance measures but do not have any standardized meaning under IFRS Accounting Standards. Cash costs include mine site operating costs such as mining, processing, G&A and royalty expenses but exclude depreciation and depletion and reclamation costs. Cash cost per ounce sold is calculated by dividing total cash costs, less the NPI royalty and 50% of operating costs for the Interlake zone, by attributable gold ounces sold. The Company discloses cash costs and cash cost per ounce sold as it believes the measures provide valuable information to investors and analysts in evaluating the Company's operational performance and ability to generate cash flows. Cash costs and cash costs per ounce sold should not be considered in isolation or as a substitute for measures prepared in accordance with IFRS Accounting Standards. All-in sustaining costs ("AISC") and AISC per ounce sold AISC and AISC per ounce sold are non-IFRS measures. These measures are intended to assist readers in evaluating the total cost of producing and selling gold from current operations. While there is 15
Page 16
no standardized meaning across the industry for these measures, the Company's definition is based on the definition of AISC as set out by the World Gold Council. The Company defines AISC as the total of cash costs, sustaining capital expenditures, sustaining exploration expenses, corporate G&A expenses, lease payments relating to sustaining assets, and reclamation cost accretion and depreciation related to current operations. AISC excludes growth capital expenditures, growth exploration expenditures, reclamation cost accretion and depreciation not related to current operations, lease payments related to non-sustaining assets, interest expense, debt repayment and taxes. AISC per ounce sold is calculated by dividing total AISC, less the NPI royalty and 50% of operating costs and sustaining capital expenditures for the Interlake zone, by attributable gold ounces sold. 16
Page 17
Operating cash costs and AISC reconciliation The following table reconciles these non-IFRS measures to the most directly comparable IFRS measures: Three months ended June 30, Three months ended March 31, Six months ended June 30, Hemlo Mine Unit 2026 2026 2026 Gold produced (100%) oz. 27,858 34,764 62,622 Gold produced (attributable) oz. 25,188 29,699 54,887 Gold sold (100%) oz. 32,425 38,685 71,110 Gold sold (attributable) oz. a 27,858 32,052 59,910 Cost of sales $'000s 96,842 113,129 209,971 Less: Depreciation expense $'000s (26,845) (28,363) (55,208) Less: PPA inventory1 $'000s (1,340) (7,287) (8,627) Costs allocated to by-products $'000s (552) (697) (1,249) Total site cash costs (100%) $'000s b 68,105 76,782 144,887 Sustaining capital expenditures $'000s 17,418 12,385 29,803 Others $'000s 1,744 1,746 3,491 Total site AISC (100%) $'000s 87,267 90,913 178,181 Less: Interlake NPI $'000s c (11,151) (24,806) (35,957) Total site AISC less NPI $'000s d 76,116 66,107 142,224 Less: 50% of Interlake costs Interlake operating costs $'000s e (4,574) (7,576) (12,150) Interlake sustaining capital expenditures $'000s f (185) (684) (869) Total site cash costs (attributable) $'000s g=b+c+e 52,380 44,400 96,780 Total site AISC (attributable) $'000s h=d+e+f 71,357 57,847 129,205 Total site cash costs (attributable) $/oz. sold g/a 1,880 1,385 1,615 Total site AISC (attributable) $/oz. sold i=h/a 2,561 1,805 2,157 Corporate G&A costs and other (attributable)2 $/oz. sold j 252 247 249 Consolidated attributable AISC $/oz. sold i+j 2,813 2,052 2,406 1. Represents the portion of cost of sales that consists of the fair value adjustment to gold inventories in the purchase price allocation of the Hemlo Acquisition. 2. Calculated as total G&A expenses, less depreciation, as disclosed in the notes to the interim condensed consolidated statement of income and capital expenditures for the corporate office divided by attributable gold ounces sold. 17
Page 18
Three months ended June 30, Three months ended March 31, Six months ended June 30, Unit 2026 2026 2026 General and administrative expenses $'000s 6,972 7,907 14,879 Less: Depreciation in G&A expenses $'000s (38) (33) (71) Corporate sustaining capital expenditures $'000s 84 50 134 Corporate G&A costs and other $'000s 7,018 7,924 14,942 Corporate G&A costs and other (attributable) $/oz. sold 252 247 249 Average realized price per ounce sold In the gold mining industry, average realized price per ounce sold is a common performance measure that does not have any standardized meaning. The most directly comparable measure prepared in accordance with IFRS Accounting Standards is revenue from gold sales. Average realized price per ounce sold should not be considered in isolation or as a substitute for measures prepared in accordance with IFRS Accounting Standards. The measure is intended to assist readers in evaluating the total revenues realized in a period from current operations. The following table reconciles average realized price per ounce sold to the most directly comparable IFRS measure: Three months ended June 30, Three months ended March 31, Six months ended June 30, 2026 2026 2026 Total revenue $ 142,499 $ 186,265 $ 328,764 Less: Silver sales (552) (697) (1,249) Less: Sales to Wheaton (7,289) (17,153) (24,442) Total gold revenue excluding sales to Wheaton $ 134,658 $ 168,415 $ 303,073 Total gold ounces sold 32,425 38,685 71,110 Less: Gold ounces delivered to Wheaton (2,283) (4,478) (6,761) Total gold ounces sold excluding sales to Wheaton 30,142 34,207 64,349 Average realized price per ounce sold $ 4,467 $ 4,923 $ 4,710 Sustaining capital and growth capital Sustaining capital and growth capital are non-IFRS measures. Sustaining capital is defined as capital required to maintain current operations at existing levels. Growth capital is defined as capital expenditures for major growth projects or enhancement capital for significant infrastructure improvements at existing operations. Both measurements are used by management to assess the effectiveness of investment programs. 18
Page 19
Sustaining and growth capital is reconciled to the amounts included in the interim condensed consolidated statements of cash flows as follows: Three months ended June 30, Three months ended March 31, Six months ended June 30, 2026 2026 2026 Sustaining capital expenditures $ 17,502 $ 12,435 $ 29,937 Growth capital expenditures 6,857 7,688 14,545 Total cash capital expenditures $ 24,359 $ 20,123 $ 44,482 Free cash flow Free cash flow is a non-IFRS performance measure that is calculated as cash flows from operations net of cash from investing activities. The Company believes that this measure is useful to the external users in assessing the Company's ability to generate cash flow after capital investments. Free cash flow is reconciled to the amounts included in the interim condensed consolidated statements of cash flows as follows: Three months ended June 30, Six months ended June 30, 2026 2025 2026 2025 Cash generated from (used in) operating activities $ 35,648 $ (61) $ 123,547 $ (86) Cash used in investing activities (24,359) — (40,766) — Free cash flow $ 11,289 $ (61) $ 82,781 $ (86) Earnings before interest, taxes, depreciation, and amortization EBITDA represents net earnings before interest, taxes, depreciation and amortization. EBITDA is an indicator of the Company's ability to generate liquidity by producing operating cash flow to fund working capital needs, service debt obligations, and fund capital expenditures. The following is a reconciliation of EBITDA to the interim condensed consolidated financial statements: 19
Page 20
Three months ended June 30, Six months ended June 30, 2026 2025 2026 2025 Net income (loss) $ 31,002 $ (67) $ 53,128 $ (80) Add: Finance costs, net 7,207 — 19,637 — Depreciation expense 26,883 — 55,279 — Income tax expense 12,112 — 35,745 — Earnings before interest, taxes, depreciation and amortization $ 77,204 $ (67) $ 163,789 $ (80) Adjusted net income and adjusted basic earnings per share Adjusted net income and adjusted basic earnings per share are financial measures with no standard meaning under IFRS. These non-IFRS financial measures are used by management and investors to measure the underlying operating performance of the Company. Presenting these measures from period to period is expected to help management and investors evaluate earnings trends more readily in comparison with results from prior periods. The Company calculates "adjusted net income" as net income (loss) for the period adjusted to exclude specific items that are significant, but not reflective of the underlying operations of the Company, including, but not limited to: costs related to the Hemlo Acquisition, including share-based compensation grants issued in conjunction with closing of the Hemlo Acquisition; unrealized changes in fair value on derivative financial instruments; changes in fair value on Contingent Consideration; accretion expense on the gold stream liability with Wheaton; the portion of cost of sales that consists of the fair value adjustment to gold inventories in the purchase price allocation of the Hemlo Acquisition; and other unusual or non-recurring items. "Adjusted basic earnings per share" is calculated using the weighted average number of shares outstanding under the basic method of earnings per share as determined under IFRS. 20
Page 21
The following is a reconciliation of adjusted net income and adjusted basic earnings per share to the interim condensed consolidated financial statements: Three months ended June 30, Six months ended June 30, 2026 2025 2026 2025 Net income (loss) $ 31,002 $ (67) $ 53,128 $ (80) Add (deduct): Hemlo Acquisition costs, including transaction related share-based compensation 2,920 — 7,252 — Change in fair value of gold derivative financial instruments (7,388) — (8,032) — Change in fair value of Contingent Consideration (20,670) — (12,250) — Accretion of gold stream liability 4,275 — 11,502 — PPA inventory1 1,340 — 8,627 — Non-recurring IBA payments 15,813 — 15,813 — Adjusted net income (loss) $ 27,292 $ (67) $ 76,040 $ (80) Adjusted basic earnings (loss) per share $ 0.09 $ (0.02) $ 0.26 $ (0.02) 1. Represents the portion of cost of sales that consists of the fair value adjustment to gold inventories in the purchase price allocation of the Hemlo Acquisition. 21