Detailed narrative
Q2 Financial Performance Overview
Second quarter 2026 revenue was $7.9 million, a 25% decline year-over-year, primarily due to lower realized antimony pricing. Sequentially, revenue increased 17% from Q1. Gross profit was $0.6 million, resulting in a 7% gross margin, significantly down from 27% in the prior year.
Operating expenses rose to $7.6 million, leading to an operating loss of $7 million, which included $3.4 million in non-cash items like share-based compensation and D&A. Net income was $0.1 million, bolstered by a $6.8 million unrealized gain from the Larvotto Resources investment.
Balance Sheet and Liquidity Strength
The company ended Q2 FY26 with a materially stronger balance sheet. Cash and cash equivalents surged to $41.4 million, up from $3.2 million in Q1 FY26. Total liquidity, including U.S. Treasuries, reached $62.2 million. Total assets grew by $42.6 million to $190.6 million, and working capital doubled to $70 million.
Total liabilities declined to $9.6 million, with debt remaining de minimis. The Larvotto strategic equity investment added $43.2 million, bringing total cash, investments, and marketable securities to $105 million.
Strategic Inventory Build-Up and DLA Contract
Inventory at quarter-end increased to $21.6 million, reflecting an intentional strategy to build feedstock and finished goods for the DLA contract and other commercial demand. The company delivered its first two shipments of antimony ingots to the DLA in June, totaling approximately 82,000 pounds, representing $2.6 million in revenue, which will be recognized in Q3 FY26.
Cumulative orders under the DLA contract now total $57.3 million, with expectations for additional shipments in Q3 and Q4.
Mining Operations and Project Development
Metallurgical testing continues for the tungsten deposit in Ontario, with plans for a 20,000-ton bulk sample. In Montana, mining resumed at Stibnite Hill, with 25 truckloads of 16 tons each of 10% antimony ore shipped to the Radersburg mill. In Alaska, trenching and drilling continue at Ester Dome for stibnite, and a core drilling program is underway at the MK copper deposit.
The Nolan Creek property, acquired in January, has an inferred reserve of 42,412 tons grading 28% antimony and 0.408 ounces of gold per ton, with mining tentatively planned to begin late this year.
Antimony Procurement and Processing Initiatives
The company continues to procure metallic feedstock from international sources, with approximately 300 tons recently received for processing. The Bolivia facility is expected to come fully online at 150 tons per month in the coming months⏳, providing valuable process information for the domestic hydrometallurgical pathway.
The joint venture with Americas Gold and Silver in Idaho is advancing, focusing on processing complex antimony-bearing feedstocks and diversifying monetizable metals like silver.
Acquisition Strategy and Institutional Investor Growth
Management maintains stringent acquisition guidelines, turning away seven deals this quarter due to long lead times, preferring properties that can be mined within 1-1.5 years. Successful acquisitions include Stibnite Hill, Nolan Creek, and Fostung Tungsten, all progressing rapidly. Institutional ownership in the company has grown significantly to over 57%, up from 42% in Q1, with major institutional investors increasing their positions.
The company is actively expanding its investor outreach, including in Europe, to further broaden its shareholder base.