AngloGold Ashanti Ltd

NYSE:AU

Q3-2025 Earnings Call

[Operator]

Good afternoon, ladies and gentlemen, and welcome to the AngloGold Ashanti 2025 Q3 Results. [Operator Instructions] Please note that this event is being recorded.

I now hand you over to Mr. Stewart Bailey. Please go ahead.

[Stewart Bailey, executive]

Welcome to the Q3 results call. As normal, you have Alberto and Gillian doing the presentation. You have other members of the executive team available to answer questions after that presentation. Before we start, I would point you to the safe harbor statement at the front of the presentation, which contains important information regarding forward-looking statements, and we urge you to look at it.

I'll hand over to Alberto.

[Alberto Calderon, executive]

Thank you, Stewart. Safety remains our highest priority, and we're committed to eliminating severe injuries from all of our sites. Our TRIFR improved 17% year-on-year, and it's now at 0.96, well below the 2024 ICMM average. We're proud of this result and the strides we made in recent years, but we're always mindful that we're only ever as good as our last injury-free day. We will continue to work hard to mitigate risk and to learn from our mistakes and near misses.

I'm pleased to report another excellent quarter, showing clearly how momentum continues to build alongside the success of our business improvement interventions. This result, strong by any measure, is underpinned by the much improved resilience of our portfolio, steady delivery to plan and growth in free cash flow and earnings. We did set a number of new records. Free cash flow for the quarter was almost $1 billion and close to the free cash flow we generated for all of 2024, and we will pay half of that as a dividend.

Our adjusted net cash position of $450 million gives us our strongest balance sheet ever. Once again, we control costs very well despite persistent inflationary headwinds and higher royalties, the only cost that we reflect. Our performance marks the long-term industry trend of cost rising ahead of the gold price since 2021. Our cash cost and all-in sustaining costs have remained remarkably stable in real terms. This is the result of operational excellence driven by full asset potential, disciplined project execution and tight cost control.

What we can control, we continue to control very well. That's clear when you look at our managed operations. Production benefited from higher contributions from Obuasi, Kibali, Geita and Cuiaba. These strong performances were partially offset by lower tonnes and grades at Eagle, the temporary plant stoppage at Siguiri and lower underground tonnes and grade at Sunrise.

Obuasi delivered another steady on-plan performance in Q3. We're seeing the ongoing improvements in recoveries and treated. The result is supported by the investments we made in ventilation and also generally better equipment availability that we're working hard to sustain. Total cash cost for managed operations year-to-date was only up only 3%. We expect that number for the full year to be similar, only 3% up. And this is despite macro factors of 9% when you take into account the prevailing inflation rate of around 5% and the increase in royalties, which are linked to the gold price.

Let me clarify this. We expect to be within our guidance range, and that is before discounting the impact of royalties that we estimate for the year around $40 an ounce. Free cash flow at $1 billion was up 141%. Adjusted EBITDA grew 109%. Headline earnings were up 185%. The balance sheet is in excellent shape. We have ample liquidity, no material near-term maturities. At quarter end, even after record dividend payments in the first 9 months, we have moved to an adjusted net cash position of $450 million.

Let's have a quick refresher of our dividend policy. It provides for quarterly payout of $0.125 a share or around $63 million. We also provide for an annual true up payment, bringing the payout to 50% of free cash flow. We use this discretion to make that true-up at the half year, underlying it not only the extraordinary cash flow generation, but also our confidence in the outlook of the business. That took our dividend declaration for the half year to $469 million. We've done the same again for Q3 with a dividend declaration of $460 million, which matches in 3 months what we did in the first 6 months of the year. This provides one of the most generous and highest yields in the sector. And as normal, we expect a strong final quarter.

With Obuasi continued to ramp up, our Tier 1 assets now account for more than 70% of production and 80% of reserves. We expect to see the production share from our tier assets to rise still further. Our Tier 2 assets are also delivering a strong contribution. We are seeing healthy margins across the portfolio and exceptional cash flow leverage as we remain active managers of our portfolio. The sale of Serra Grande, which is expected to be finalized before the end of the year, will ensure that we can further sharpen our focus on the core business.

During this extraordinary turnaround journey we've been on since 2021, we continually assess where we can generate the most value. And the answer is clear, the best opportunities remain within. First, we are committed to lifting performance from our core assets, driving margin growth through cost discipline, which is continuing to do what we have done well in the past. Full asset potential has been invaluable in this regard, keeping cost flat in real terms -- cost per ounce in real terms. That's improved our position on the cost curve and helped us to reliably deliver on our guidance.

The insights from this program have also helped to a pipeline of organic growth options that are beginning to reveal themselves. This extends beyond Obuasi, which is starting to develop a consistent operating cadence as it ramps up. There are other projects under consideration to build scale and extend life at several other key assets. These are relatively low risk, low capital intensive opportunities that allow us to leverage our existing footprint, infrastructure and knowledge.

The returns, as you can imagine, are more than competitive. We'll flesh those out in the coming quarters, helping to daylight more value in this extraordinary portfolio of ours. And third, we're laying the foundation for the next stage of growth in Nevada, a world-class gold camp where we're building scale and optionality.

We committed to bringing some of our most exciting internal opportunities to life, and we'll start today with Geita, our marquee asset. For years, Geita has been viewed as a world-class mine and relatively short reserve life. That is completely changing. This is a Tier 1 operation by every measure, consistent delivery, strong margins and exceptional operational stability. What's often overlooked is the geological quality. Geita sits in the Lake Victoria Greenstone Belt on the Tanzanian craton, part of the same gold province that holds Kibali and North Mara. After 2 decades of mining, large parts of the concession remain underexplored with compelling structural and geotechnical targets pointing to significant bump-up potential along strike and depth.

Today, Geita hosts an open pit and multiple underground operations producing around 500,000 ounces per year, underpinned by 3.5 million ounces in reserves and more than 7 million ounces in resources. We're now showcasing the next chapter to Geita, a mine position to remain a Tier 1 asset for at least the next 20 years, but in reality, it's going to be much longer than that. Here, you see the simple road map to unlock further value. We're allocating a total of $50 million, an additional $15 million a year to exploration. With that investment, we expect to grow reserves by about 60% to increase life to 10 years or more from around 7.5 today to about 10 years or more.

Our focus is on near mine drilling with a priority of adding ounces to the 4 mining fronts we have established. We're working through a conceptual option to increase mill capacity. this mill expansion, which we conservatively forecast to cost around $100 million, we expect to grow production by 20% to about 600,000 ounces. Importantly, we're focused on maintaining margin here and not simply creating an expansion to push through lower grade material. We will update you as we move through the study process. At a proposed capital intensity of only $1,000 per ounce of incremental annual production, this is an extraordinarily profitable project.

We are looking to put this additional investment to work in an area with proven geological quality and longevity. Since we started ding up our exploration investment in 2021, reserve life has more or less doubled to current levels around 7 years. zoom out a little further, we've added 2 million ounces of reserves between 2017 and 2024, over and above the 4.3 million ounces of depletion during that period. That comes at a cost of $39 an ounce, which is exceptional value by any measure and reinforcing the quality of the geology and our exploration team.

The pipeline of targets is exceptionally rich. We've identified around 40 prospects already and believe that we will easily improve reserve life with an initial target of 10 years or more. We aim to achieve the first milestone by 2028. The first route marker for us is to see this reserve at around 4 million ounces by next year and then 5 million ounces by the end of 2028. We have set clear initial priority areas for this drilling campaign.

Given that exploration, Geita has been somewhat undergone over the past decade or more, there is a lot of low-hanging fruit. This slide shows both Geita Hill and Nyankanga underground mines, where we have established a solid track record of predictable production and an excellent understanding of the geology. Importantly, these deposits remain open at depth and development and drilling over the next years will lead us to more clearly define the extent of the deposits.

At Star and Comet, it's very much the same approach: resource definition drilling is aimed at defining the extension of the resource. At Nyamulilima, drilling has confirmed the extension of the ore body at depth with good potential to transition to underground mining in time. We have additional high confidence exploration targets with striking distance of the pit where we've already intercepted mineralization, including some high-grade areas.

So where does it will take? We have a world-class ore body supporting a compelling investment case. With the incremental exploration spend, we expect to leverage the large resource base growing reserve life to 10 years or more and keeping it at that level for many, many years. The mine has maintained a resource to reserve conversion rate of more than 30%. This will underpin the baseline production of plus 500,000 ounces over a reserve life of 10 years. Over the medium term, we will continue to progress the mill expansion opportunity, which will step up production to 600,000 ounces. We'll update you at key points for the feasibility process. That leaves Geita well positioned to unlock significant value and to sustain its Tier 1 for decades to come.

Now we move to Nevada. While North Bullfrog is our first step in Nevada after the Tier 1 discovery at which the Nevada strategy turns. It is one of the most significant gold discoveries in the generation and is in one of the world's top mining jurisdictions. This is not a modest asset. It's large with significant mine grade. As of our latest update, Arthur holds a resource of around 16 million ounces. The deposits are predominantly oxide, which is key. Our focus is currently on the Merlin deposit, where we have some more exceptionally high-grade intercepts during resource definition drilling.

These results reinforce our confidence in the project Tier 1 quality. When fully developed, the Arthur complex is anticipated to be long-life, multimillion pound producer, which will become the center of gravity for the AngloGold Ashanti and will become the largest and probably most longevity asset that we will have in the portfolio, giving us low-cost, low-risk, high-margin ounces and plenty of them. We are currently at the back of our comprehensive prefeasibility study, which will run through the remainder of the year. We expect to talk about the results of that prefeasibility study in our results in February of next year.

However, just in a quick anticipation, if you see in the graph, the #1, that's small green, that's where we are concentrating our efforts right now, and we already are seeing how we can quickly go in that area to about 800,000-plus ounces per year. And then when you look at the whole area, you can understand why we say that it's a multi-decade, multimillion ounce deposit.

The drill bit is our best tool for value creation. Our strategy is deliberately structured in 2 phases, each with a distinct purpose but one shared goal to turn a world-class resource into a long-life, high-return complex. Our immediate focus is to convert resource to reserve. We expect again to bring those results in February. This infill drilling program across Merlin and Silicon. We're delivering the data to finalize pit designs, grade control models and strip ratios for the PFS and FS. Once we've established a reserve base, we will pivot to growth, expanding the footprint and extending mine life.

I'll hand over to Gillian now to run through the financials.

[Gillian Doran, executive]

Thank you, Alberto. Q3 was marked by record gold prices driven by continued central bank buying, strong ETF inflows and still in demand amid geopolitical tensions and the weakening U.S. dollar. Oil prices were up around 13%, lower year-on-year based on both the WTI and Brent crude indices. Inflation moderated across most of our operating jurisdictions, most notably in Argentina, while Brazil saw a moderate increase to 5.2%, up from 4.4% last year.

Our unrealized inflation rate, which represents CPI changes in the jurisdictions that we operate was around 4.7%, keeping an upward pressure on our cost base. We continue to actively look for opportunities to mitigate cost impacts across the business, which we continue to demonstrate within our cash cost performance.

Production was 17% higher year-on-year in the quarter at 768,000 ounces. From our managed operations, production rose 16% to 682,000, up from 586,000 ounces in Q3 of last year. This stems from the addition of Sukari with 135,000 ounces and a 30% increase in ounces from Obuasi. The result was also supported by growth at our other key assets, including Kibali, Geita and Cuiaba. These production gains were offset somewhat by the plant stoppage at Siguiri. Total cash costs for our managed operations increased by 5% with pressure from inflation at just under 5% and royalties, which rose in line with the gold price.

Market-driven factors beyond our control would have increased cash costs from $1,172 an ounce in Q3 of 2024 to $1,272 per ounce in Q3 of 2025. We were, however, able to reduce this to $1,225 an ounce through disciplined cost management, the addition of Sukari to the portfolio and the impact of our full asset potential program. All-in sustaining costs for managed operations rose 6% year-on-year to $1,766 per ounce up from $1,665 an ounce in Q3 of '24. That increase reflecting our planned reinvestment in stay-in business capital, partially offset by our higher gold status.

Our financial results for the quarter reflect another strong performance from our managed operations with a number of new records set. Earnings and free cash flow more than doubled year-on-year, driven by continued cost discipline, the 17% increase in production and the 40% higher average gold price. EBITDA rose 109% year-on-year to $1.6 billion, driven by price and sales volumes. This was partly offset by higher costs, which, as I've said, were driven by inflation and the increase in royalties. Basic earnings climbed to $669 million from $223 million year-on-year, again, bolstered by the price and the increase in volumes.

Net cash from operating activities was up 134% to $1.4 billion, reflecting improved operating fundamentals and cash conversion. After taking into account CapEx and Kibali cash receipts, free cash flow more than doubled to $920 million, as Alberto mentioned, another record. We ended Q3 with an adjusted net cash position of $450 million, another first for our company, and it compares to $906 million in net debt just a year ago. Our focus is unchanged. We are working hard to realize more operational improvements to maximize cash conversion, extend mine life and ensure we are disciplined in allocating capital.

This slide highlights our progress in strengthening our competitive position on the cost curve. Total cash costs were $1,225 an ounce in Q3, up 5% year-on-year. Market-driven factors, including inflation, royalties, fuel price and exchange added around $100 an ounce or 9% to the cost base. The planned stoppage at Siguiri added around $58 to cash cost as a one-off. Our managed operations continue to deliver significant improvement in the things we can control, delivering an 8% improvement from productivity gains through full asset potential program, particularly plant throughput, strong operational excellence across the portfolio and of course, the addition of Sukari volumes.

AISC from our managed operations increased by just 6% to $1,766 an ounce, reflecting our ongoing capital reinvestment. We remain focused on converting higher gold prices to strong free cash flow. Gold price gains of $683 million, higher gold sales driven by strong performance at Obuasi and the contribution from Sukari as well as the focus on working capital improvement all flowed through to free cash flow, offset by higher operating costs linked to the higher gold sales volumes, higher cash taxes on higher revenues and the planned increase in capital spend with the integration of Sukari.

This all supported the widening free cash flow margin, which almost doubled to 45% in just 1 year, reflecting the strong focus on ensuring that higher gold prices and increased margins really do flow to our bottom line. The balance sheet has never been stronger. We ended Q3 in a net cash position of $450 million, underpinning total liquidity of $3.9 billion. We're in an excellent position not only to fund our capital pipeline, but to continue returning capital to shareholders. And finally, we remain on track to meet our 2025 guidance in all metrics.

I'll hand back to Alberto for a wrap-up.

[Alberto Calderon, executive]

Thank you, Gillian. Since 2021, our total cash costs in real terms has trended lower versus a 19% gain for our peers. We have stayed flat, as you can see, the average of the peers in real terms has come close up to 20%. That led to a margin growth that has outpaced the same peers as a result. This has been enabled by our full asset potential, which focuses on producing more ounces with fewer costs, which has made us more competitive. We're working hard to ensure that we maintain this advantage.

Some years ago, the analysts would say, well, we trade at a discount because we have a lower margin. As you can see, now we have the same margin, but we still have somewhat of a discount that you'll see on the next slide. We made steady progress in narrowing the rating gap relative to our North American peers. This hasn't been about fixing a single issue, but rather executing a comprehensive plan over the past years to strengthen every aspect of the business. Our fundamentals are robust, our portfolio is performing and our outlook has never been more promising. We continue to progress Nevada.

Let me probably add, we're proud to have received this year the 2026 Thayer Lindsley Exploration Award that just underpins that this has been one of the most significant discoveries in the U.S. in more than a decade. We're delivering on what we said we would, achieving consistent operational improvements, enhancing returns and positioning the company for sustainable growth. And importantly, we've ensured that 94% of the gold price increase has flowed on to the bottom line.

Let me just explain this. If you multiply the dollars increase in the gold price by our tonnes, you get the increase in the revenue, 94% of that increase has slowed on to the bottom line to net operational cash flows. This has generated one of the highest free cash flow yields in the industry. Actually, if you look at the third quarter, we would be the highest free cash flow per ounce in the industry of any of the large companies.

As we assess our valuation metrics, we believe AngloGold Ashanti represents a compelling investment proposition, combining strong cash generation, a disciplined and shareholder-focused capital allocation framework, market-leading yield, predictability and valuation that offers clear upside potential.

With that, I'll take your questions.

[Operator]

Our first question from the telephone lines comes from Adrian Hammond of SBG.

[Adrian Hammond, analyst]

Alberto and Gillian, I have a question for each of you, if we just start with you, Alberto. Since we last spoke on your results, it was a gold price that was at $1,000 an ounce or so below where we are today. So this certainly must change the way you think about the business or at least in shareholder returns. So you have a dividend policy and your free cash flow is certainly well in excess of what your immediate needs and plans are. So what is your strategy with dividends? Specifically, you've certainly done a true-up this quarter, and we could expect that, I assume, going forward, it spot persists. But certainly, you'll start building a lot of cash. So buybacks or increased payouts and debt redemption, are you able to talk a bit more to that?

[Alberto Calderon, executive]

Thanks, Adrian. Yes. Look, every quarter, we sort of talk about how we can obviously have our shareholders share in this gold price. And as I mentioned in my presentation, the fact that we have been able to pass all of the gold price by 94% into the bottom line. And so this was where we again said, okay, let's make an exception to the policy and let's distribute 50%. I've also said, I probably said in the first half that we will reassess things in February, and we will determine if there's any need for additional further capital allocations.

And as you mentioned, between debt reduction or dividends additional or buybacks. But we will talk about that in February of next year. I don't notice that there's many gold companies again are sort of comfortable with a positive net cash. Again, I think that there's limits to that, but I think we're far away from that. But in February, we will definitely deal with additional sort of ideas for capital distribution or allocation, let's say.

[Adrian Hammond, analyst]

That's clear. And perhaps for Gillian. On costs, you're trending at the upper end of your guidance and certainly, royalties is putting pressure there that I'm assuming wasn't part of your assumption at the start of the year when you put these forecasts out or guidance out. So could you just reconcile what those assumptions were? And are you confident that given you're probably going to pay a bit more on royalties this quarter, why you think at least you should meet that guidance?

And then secondly, some of your peers have really started ramping up the reserve gold price assumption. I assume that's going to be a trend for the sector, but probably some more than others, which is telling in respect of what sort of capital you plan on investing in the business because those reserves will need infrastructure. So are you able to give us some sort of insight into your reserve gold price plans in respect of capital discipline?

[Alberto Calderon, executive]

Let me start with that, and Gillian will help me with the latter. But we did say, Adrian, very, very clearly that we were assuming that $2,350 gold price then. And that obviously, we love, as I said, the only cost we love is royalties because it's tied to the price, but that our guidance was excluding that. So if you look at where we'll end up in the year roughly, the impact of that, it will be about $40 an ounce on the cash cost. Having said that, we expect -- even without that, we expect to be right on the top end. And then with the royalties, excluding the royalty, we will be way within the cash cost.

As I mentioned, our managed operations, the non-managed has gone up more than we would have wanted Kibali, but our managed operations are only up 3% in nominal terms. So I think this will be one of our best years in terms of managing costs. And so we're quite happy about that. And then we will reconsider the gold price. But we said it before that we distinguish very clearly between if we're plan constrained or mine constrained. If you're constrained, there's just no point in changing the reserve or reserve gold price. If you're not, then we'll look at it.

But I would say that in general, our default is we're really not being changing anything because of the higher gold price. But we'll look at it and probably we will adjust it on a cost base, not so the cost of the industry have gone up, and then that's probably how we will look at it. But we will be probably along the most conservative in the industry in that regard because we just don't see a pointed. But Gillian?

[Gillian Doran, executive]

Yes. So thanks, Alberto. As Alberto said, the focus is on maintaining grade in our operations and not changing that focus on rate because of gold price changes. You will know that our reserve price is $1,600 an ounce currently and resource price is $1,900. We do obviously do an annual assessment of that and would anticipate sort of marginal increases in '25, maybe $100 an ounce. But it's really looking at the change in the cost curve and its impact on us maintaining those grades rather than focusing on price, as Alberto said. I think the other thing we always do on major capital projects is look at price sensitivity regardless of that price that you set for reserve and resource. And that's just a standard thing that we would do anyway.

[Adrian Hammond, analyst]

That's clear. Well done on a good quarter and look forward to some more insights into reserve extensions and life extensions, if you have.

[Operator]

Our next question comes from Joseph Reagor of ROTH Capital Partners.

[Joseph Reagor, analyst]

Just a quick thing. Do you guys have any planned shutdowns like to the magnitude that was Siguiri in the quarter for Q4 that we should be aware of?

[Alberto Calderon, executive]

No. The quick answer, no. There's everything -- we expect a very strong fourth quarter right now. What we know and we will say what we don't know, we don't know, well, that's different. But what we hope we don't know and what we know we know, we're fine.

[Operator]

[Operator Instructions] Our next question comes from Tanya Jakusconek of Scotiabank.

[Tanya Jakusconek, analyst]

Adrian asked a few of them. So I too look forward to hearing about the reserves and what's happening on that front. But I'm going to come back and I'm going to focus on Geita, if I could. I'm just looking at some of the slides you presented and thinking about the processing facility. So you said it's about $100 million to get that processing facility up. Just can you go through what exactly would be needed at the processing facility?

And then on the mining side, I see that you're going to be looking at 4 sources of production, 1 open pit and 3 underground. So I'm just trying to wonder how much money would be required to put in the underground? And on the open pit side, is there anything that I should be thinking about like a pit layback that would involve a lot of waste. So I'm trying to understand what's required on the mining side from the capital standpoint as well? That's my first question.

[Alberto Calderon, executive]

Tanya, look, on the second question, we already have 4 sources of ore. I don't see -- there's nothing that -- there's not a big chunk of, let's say, unusual capital that we would need on that. I think that's what makes it so strong and so predictable in those 4 sources of ore. So there's nothing about it. We are -- I'll ask Marcelo Pereira to give any details on the plant expansion. But it's still probably not even in pre-feasibility, but it is a project that is one of those when it comes, that will be a no-brainer, extremely profitable and relatively minor cost.

So it's a pure -- this all comes from full asset potential. Full asset potential is it addresses the 5 or 6 things that we're going to debottleneck and have the greatest rate of return. So this comes from that type of thinking. But Marcelo, is there any more details on that processing plant?

[Marcelo Pereira, executive]

Absolutely, Alberto. And thanks for the question. Our plan is focused on optimizing as best as possible the capacity that we have in the plant without major investments. As Alberto has pointed out, we are planning to do investments in around $100 million as we are foreseeing now according to our level of the engineering for this plan. And our expectation is that we are going to add one additional milling capacity, but it's going to be confirmed by the engineering studies that we are confirming now. At this moment, we see very good capacity in the mill sir, which will not require additional investments. But all of these are going to be confirmed by the engineering study that we are performing at this moment.

[Tanya Jakusconek, analyst]

Okay. So it looks like just upgrading of these components then at this plant. There's nothing really major to do beyond that. And it appears then on the mining front, continued open pit mining and underground would be development work. Would that be fair?

[Alberto Calderon, executive]

Yes.

[Tanya Jakusconek, analyst]

Okay. That's great. Hopefully, one day, you get to see this asset as well. My second question, if I could. Alberto, it's to you. You started your presentation by talking about your best opportunities are within the company, so organic growth. So you've got Geita that's ramping up. You've got obvious -- sorry, Geita, Obuasi is ramping up, Geita opportunity now. You've got the Arthur Gold that's coming in towards the end of the -- well, after the end of the decade for Merlin. What about -- how do you balance that with M&A opportunities? We talked about safe jurisdiction, just selling some assets. How do you look about -- how do you think about that in terms of replacing those ounces and looking at your overall geopolitical risk profile?

[Alberto Calderon, executive]

Thanks, Tanya. Look, probably I'll start with your -- what you implied when you start the question. When we look at this opportunity like Geita, but also Cuiaba and its potential, the potential of Siguiri in the long term, it's just very, very impactful and very low cost. So it's actually very difficult to compete because the rate of returns of all of those 3 and others of Obuasi, as we expect from others is just extremely high. And so that's -- if you look at our brownfield exploration budget, it's increasing by about 40% or something like that. And that's what we're doing, exploring more in Geita, exploring more in Cuiaba, exploring more in Sukari. So just to delineating what we have multi-decade deposits.

And so that's -- as I said, that's where I would say the focus the bulk of the management team and 99.9% of the people is Yes, there is a group in BD that looks at opportunities I said before, it's difficult to do M&A because it needs to add value. I also haven't been shy in saying that we will focus probably in developed countries more than anything, like if we could have the next equivalent to or a bit smaller Tier 1 cost, it will be something that will -- and we can add value to the company, we will look at that. We will assess our opportunities. And if they're, for example, competitive I said before, probably we will lose, and that's fine.

We will only do something if it adds value. And that's about it. So yes, in summary, main focus is wonderful opportunities we have. We have a big team that is very good. and that its track record to date in terms of Corvus, Augusta and obviously, Centamin. And then it's very disciplined in selling things in selling what we sold in Africa and Serra Grande is very good. So then continue to try to do that. And yes, that's how we look at those things, Tanya.

[Tanya Jakusconek, analyst]

Okay. And so should I be thinking that maybe the completion of the Cerro Vanguardia mine asset would be sold in 2025 as well? Or is that a '26 story for an asset sale?

[Alberto Calderon, executive]

I think it will be close. So either fourth quarter or first quarter of next year. Either this year first quarter of next.

[Tanya Jakusconek, analyst]

And is that pretty much in your portfolio, you're done with the asset sales? I think you still have a royalty portfolio. Is that correct?

[Alberto Calderon, executive]

Sorry. What was the question?

[Tanya Jakusconek, analyst]

I think I was just commenting that after we've done Cerro Vanguardia, that asset sale, are you done with asset sales? I think you still have a royalty portfolio that could be sold. But besides that, is that it on the asset sales?

[Alberto Calderon, executive]

I think it's small, but we can look at it. And then CBSA, again, let me probably reassess. We're in the process we have with offers, but as always, we never know if it's going to be concluded or not, but we know that will be concluded as soon as LSG. But the portfolio, the loyalty portfolio I don't think it's very significant for us right now. But I think Terry mentioned something. I don't know, Terry, I think you're on the call.

[Terry Briggs, executive]

Yes. This is something we'll probably look at in 2026 because there's still the 2 ongoing sales process, as Alberto mentioned, which might come with contingent payments that will add to the existing royalty portfolio, but it's relatively modest, but something we'll probably look at next year.

[Operator]

At this stage, I will hand over for questions from the webcast.

[Stewart Bailey, executive]

All right. Alberto, Gillian, I'll go in no particular order here. But [ Shashi Shekhar ]from Citibank says, what is the total expenditure, capital expenditure you're planning to increase the reserve by 60%. So that's obviously a Geita question. And then to increase production to 600,000 ounces. On Siguiri, just is the processing plant operating at 100% currently? And when do you expect the mined but not processed ore that we produced in Q3 to be fully processed?

[Alberto Calderon, executive]

Okay. So the gate that we're increasing the budget from $35 million to $50 million, and that's going to be for some years, and that should take us to the 10-year to 4 million in 2026 and to 5 million ounces of reserve in 2027, '28. And then the 600,000 ounces, that's the plant and the plant is $100 million today, again, we'll see what it is. But we know that it will be a project that we will do because it's such a high rate of return.

Look, in Siguiri, the mine is operating normally. The plant is operating, but it will go at full speed again, probably the third quarter of next year. But because we're processing such high grade because the mine has not shut, we expect, for example, that for the year, Siguiri will still be up 8% versus 2024. So it will still be a very good year for Siguiri.

[Stewart Bailey, executive]

Right. The next question from [ Yamin Gosain ] at Laurium Capital. He says, team, well done on a wonderful set of results. The current CapEx run rate is around $368 million a quarter, implying $590 million in Q4 to reach the midpoint of guidance. Can we expect to see a big CapEx number in Q4? Or will some of this be rolled over into '26?

[Gillian Doran, executive]

Thank you for the question. I think we would anticipate relatively stable capital spend in stripping ore development, et cetera. We do in Q4 some orders for fleet management strategy. And so you'll definitely see an increase, but we're well within our guidance range for the full year.

[Stewart Bailey, executive]

Good. There is another question here from Herbert Kharivhe at Absa. He says, what is the outstanding dividend payment from CVSA? And is it likely that you received an amount this quarter?

[Gillian Doran, executive]

So we -- just to get clear, we have finalized our 2024 financial statements for CVSA, which allows us to pay up dividends through to our parent company. We have done that quite significantly actually in 2025. And so there's no restrictions on how much we can flow back through to the parent company. We, of course, will want to maintain working capital levels in Argentina, but we've made really good progress on cash lockups in that region, yes.

[Alberto Calderon, executive]

The cash lockups, I think if you look at it, we've gone from $176 million to $100 million roughly. So dramatically reduce the cash lockup is probably where we make the most gains. So obviously, that's not surprising given sort of that there's a panel in charge first time in a long time in Argentina. So things are better.

[Stewart Bailey, executive]

Thanks, Alberto. We have one from [ Larry Clarkson ] at Redington Intelligence, and he just wanted to understand if we've paid back any of our bonds over the quarter?

[Gillian Doran, executive]

No.

[Stewart Bailey, executive]

The answer for that is no, Larry. And then just to sort of close up, there are a couple of questions, [ Martin at Mining Weekly ]. Martin, you've asked some questions on clean energy use installed and whatnot. If you would just allow me to come back to you after the call on those questions. And [ Jack Forbes ], Jack, you can get hold of me just to follow up on your question on [e-mail], and we can have a discussion just around the difficulty you're having on that.

But other than that, we have no other questions. So Alberto, just maybe a closing remark from you before we wrap.

[Alberto Calderon, executive]

I haven't thought about that. But anyway, look, it's all about disciplined execution. It's really -- and when we talk about disciplined execution, it's 40,000 people who really do the work and deliver every day, and it's just pretty amazing to see. And it's been a journey the last 4 years, but seeing how everybody is seeing to that same tune and just being able to reliably and predictably deliver what we say we're going to do.

That's your ambition in mining, the highest ambition to do that, and we are, we have been able to do it. And just again, it's just that 40,000 people who understand and are really getting up every day and delivering that. So it's just for me, it's just a thanks to all of them, and thanks to our shareholders and investors, and we will keep trying to be predictable, reliable and at the top in other mining -- gold mining industry. Thanks.

[Stewart Bailey, executive]

Perfect. Thanks, Alberto. Thank you.

[Operator]

Thank you all. Ladies and gentlemen, that concludes today's event. Thank you for joining us, and you may now disconnect your lines.