McEwen says San José mine cash generation blew past expectations

McEwen (NYSE, TSX: MUX) says the San José mine in Argentina has already generated more cash than expected this year, allowing the company to fund its growth plans without diluting shareholders.

The Canadian miner announced on Friday that it has received a further $49.4 million dividend from the gold-silver mine, which is operated by controlling owner (51%) Hochschild Mining (LON: HOC). McEwen holds the remaining 49% and derives cash from the operation.

Total dividends from San José have now reached $58.2 million, surpassing its original target of $40-50 million for 2026, McEwen said, adding that the improved balance sheet would allow the company to grow with minimal share dilution.

By the end of the March quarter, the company held about $56.5 million in cash, $13.5 million in marketable securities, $15.7 million in loans to its McEwen Copper spinout, and $457 million and $20.4 million in investments in McEwen Copper and Paragon Advanced Labs, respectively.

McEwen’s stock edged 1% lower on Friday morning. In New York, it traded at just under $21 a share with a market capitalization of $1.25 billion.

Doubled production by 2030

“At current gold and silver prices, and assuming operations perform as expected, we believe McEwen can fund much of its planned production growth through cash generated by its own assets,” it said.

The company is aiming to double its total production to 250,000-300,000 gold-equivalent ounces (GEOs) by the end of this decade. This would be accomplished through improving its existing operations and bringing new mines online. The Stock mine, which is part of the Fox Complex in Ontario, is expected to enter production in the second half of 2026, while the El Gallo mine in Mexico is targeted for mid-2027.

The San José mine, which has been in production since 2007, currently accounts for about half of McEwen’s consolidated production, and is expected to deliver 59,000-64,000 GEOs this year.