Release Date: January 21, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• TRX Gold Corp (TRX) has successfully reduced operating costs by over half, even with a lower grade profile.

• The company has increased its throughput by over 100% year-over-year, reaching over 1,700 tons per day.

• TRX Gold Corp (TRX) benefited from record high gold prices, realizing $2,653 per ounce, which is $700 higher than the previous year.

• The expanded plant has demonstrated significant economies of scale, leading to a 111% decrease in processing cost per ton.

• The company has a robust exploration program with promising results, particularly at Stanford Bridge, which has returned the highest grades to date.

Negative Points

• The lower grade profile in Q1 2025 resulted in less gold being processed compared to Q1 2024.

• Recovery rates have declined due to the lower grade ore and stripping activities.

• The company is currently undergoing a stripping campaign, which involves mining a higher proportion of waste tons, impacting short-term production.

• Operational efficiencies are still being optimized, with ongoing refurbishments and upgrades needed for the plant.

• The flotation circuit, which could improve recovery rates, is still in the planning phase and may take up to 12 months to implement.

Q & A Highlights

• Warning! GuruFocus has detected 1 Warning Sign with TRX.

Q: Could you provide more details on the expected head grades and recovery rates for the upcoming quarters? A: In Q2, the head grade is expected to be slightly lower than Q1, with recovery rates anticipated to be slightly higher. The head grades are projected to improve significantly in Q3 and Q4 as we move through the stripping campaign and access higher-grade ore blocks. (Steven Maloney, CEO)

Q: What operational improvements have been observed since the commissioning of the new plant? A: The crushing circuit is now operating at full capacity, and we are making operational tweaks such as screen size adjustments. We are also refurbishing ball mills to maintain throughput. Additionally, a new Genset has been installed to ensure consistent power supply, and a new elution plant is being ordered to improve recovery rates. (Steven Maloney, CEO)

Q: What is the timeline and funding plan for the potential flotation circuit? A: The flotation circuit project is expected to take approximately 12 months. We are considering debt financing to fund this project, leveraging our current adjusted EBITDA of $17 to $20 million. (Steven Maloney, CEO)