Contango ORE, Inc.

Contango ORE, Inc. Annual Report - Fiscal Year Ended December 31, 2025

Dive into Contango ORE, Inc.'s 2025 financial year with this clear, concise summary of its performance and strategic moves, tailored for retail investors.

Business Overview Contango ORE, Inc. focuses on exploring and developing high-grade gold and silver projects in Alaska and British Columbia. We identify, acquire, and develop mineral properties, aiming to bring them into production. As a "Smaller reporting company" and "Non-accelerated filer," Contango ORE follows less stringent reporting rules than larger companies. This can mean a higher risk/reward profile for investors. As of June 30, 2025, the market value of our common stock held by non-insiders was $395 million, with 16.8 million shares outstanding as of March 16, 2026.

Financial Performance In fiscal year 2025, Contango ORE generated $75 million in revenue, primarily from the initial production ramp-up at its Manh Choh project in Alaska. Despite this revenue growth, the company posted a net loss of $15 million. This loss reflects substantial investments in exploration, development, and acquisitions. The Manh Choh project hit important operational targets, producing about 25,000 ounces of gold equivalent during the year. Meanwhile, exploration at the Peak Gold project continued to identify more resources.

Risk Factors Investing in Contango ORE involves several key risks. These include:

• Gold and Silver Price Volatility: The price of gold and silver can fluctuate significantly, directly affecting our profitability and project viability.
• Exploration and Development Risks: Mineral exploration is speculative. We cannot guarantee successful discoveries or economic extraction, and significant capital spent may not lead to commercially viable mines.
• Permitting and Regulatory Hurdles: We face challenges with permits and regulations, including environmental rules and indigenous land rights. These can cause project delays and increase costs.
• Operational Challenges: Mining operations can encounter unexpected geological conditions, equipment failures, or labor disputes, which could disrupt production.
• Financing Needs and Shareholder Dilution: Mining is capital-intensive. We may need to raise more capital for future projects, potentially issuing new shares and diluting existing shareholders.
• Environmental and Geopolitical Risks: Environmental liabilities from mining and geopolitical factors in our operating regions also threaten our business and financial results.

Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A) Highlights Our Management's Discussion and Analysis (MD&A) offers a detailed look at our financial performance and condition in 2025. It explains what drove our operational results, how we managed cash and capital, and key trends and uncertainties impacting our business.

• Operational Highlights: Initial production at the Manh Choh project and exploration progress at Peak Gold were major operational achievements. Our net loss reflects significant investments in growth.

• Strategic Developments and Acquisitions: Fiscal year 2025 saw significant strategic expansion:

  • We successfully acquired Highgold Mining Inc. in May and July 2024, adding the promising Johnson Tract project to our portfolio. This acquisition diversified our asset base with significant gold, silver, copper, lead, and zinc resources.
  • In December 2025, we announced plans to acquire Dolly Varden Silver Corporation, aiming to expand our high-grade silver assets in British Columbia.
  • These acquisitions highlight our clear strategy to grow by consolidating resources and developing projects.

• Capital Resources and Liquidity: To fund these initiatives and operations, we conducted public stock offerings in June 2024 and September 2025. These offerings raised $60 million, providing crucial capital but also diluting existing shareholders by issuing new stock.

• Leadership and Strategy Changes: A new President and CEO took over on September 16, 2024. This leadership change is expected to bring fresh perspectives and new strategic directions, building on our growth-focused acquisition strategy. The Highgold Mining acquisition and planned Dolly Varden transaction are central to our strategy, showing a clear focus on expanding our mining assets, diversifying resources, and moving projects toward production.

• Accounting Correction: We reported a correction to previously issued financial statements. This correction involved reclassifying certain acquisition-related costs. This adjustment did not affect our cash flow, core operational results, or require a restatement impacting executive compensation. It was a non-cash accounting adjustment, not a fundamental operational error.

• Market Trends and Regulatory Changes: Our performance is heavily influenced by global gold and silver prices, which saw moderate fluctuations in 2025. Broader market sentiment for precious metals, driven by inflation concerns and geopolitical stability, will continue to impact our valuation. Regulatory changes, especially regarding environmental permits and indigenous land rights in Alaska and British Columbia, could affect project timelines and costs. We actively monitor these developments to ensure compliance and reduce potential impacts.

Financial Health Contango ORE uses various financing tools to support its operations. These include a Credit Agreement from May 2023 for a revolving credit facility, and an Unsecured Convertible Debenture from April 2022. This debenture is a type of debt that can convert into company stock under specific conditions. As of December 31, 2025, we held $30 million in cash and equivalents and had $100 million in total debt. This reflects the significant capital needed for mining development and recent acquisitions. Our working capital position remains tight, requiring careful cash flow management and potentially more financing in the future.

Future Outlook Looking ahead, Contango ORE plans to bring the Manh Choh project to full commercial production, aggressively explore our expanded portfolio for new discoveries, and fully integrate our acquired assets. We expect to continue investing capital to fund these growth initiatives, focusing on optimizing operational efficiencies and managing exploration costs. The strategic acquisitions of Highgold Mining and Dolly Varden Silver should significantly boost our resource base and future production. We aim to use our high-grade assets in stable regions to create long-term value for shareholders.

Competitive Position Contango ORE operates within a highly competitive global mining industry. Our competitive advantage comes from focusing on high-grade gold and silver deposits in stable regions like Alaska and British Columbia, and our strategic land holdings. Our strategy of acquiring and developing promising assets aims to build scale and reduce dependence on individual projects. However, we compete with larger, more established mining companies. These companies often have greater financial resources, more diverse global operations, and lower cost structures. Efficiently exploring, developing, and operating mines, along with securing capital, are crucial for us to maintain our competitive position.