From Tailings to Treasure: Amerigo's Dividend Signals a New Playbook

VANCOUVER, BC – December 10, 2025

When Amerigo Resources announced its second performance dividend of 2025, a Cdn$0.05 per share payout, it was more than a routine update for the financial ledgers. For observers of industrial innovation, it was a powerful signal. This move, which brings the company’s total declared dividends for the year to an impressive Cdn$0.18 per share, is the direct result of a unique business model converging with disciplined strategy and favorable market tailwinds. It demonstrates how an innovative approach to resource extraction, when coupled with astute financial management, can generate substantial, tangible value—not just for the company, but directly for its shareholders.

While many firms in the resource sector ride the waves of commodity cycles, Amerigo’s story offers a more nuanced lesson in resilience and strategic foresight. The dividend is not an isolated event but the culmination of a strategy that transforms mining byproducts into profit, leverages a debt-free balance sheet, and interprets the booming copper market as an opportunity for aggressive, yet calculated, shareholder rewards.

A Foundation of Financial Discipline

At the heart of Amerigo's ability to generously reward its investors is a fortress-like balance sheet, methodically constructed over the past several years. The company reached a pivotal milestone on October 27, 2025, when it made its final debt repayment, officially becoming a debt-free entity. This achievement cannot be overstated; it unshackles the company from interest payments and restrictive covenants, affording it the ultimate flexibility in capital allocation. This financial freedom is the bedrock upon which its shareholder return policy is built.

The numbers tell a story of robust health. Amerigo's net income surged from $3.4 million in 2023 to $19.2 million in 2024, accompanied by a strong EBITDA of $68.8 million. This momentum carried through 2025, with Q3 revenue hitting $52.5 million, surpassing market expectations. More importantly, the company has demonstrated a consistent ability to generate significant free cash flow to equity (FCFE)—the cash available to be distributed to shareholders after all expenses and reinvestments are accounted for. This consistent cash generation, even amidst the operational volatility inherent in the mining sector, is what fuels the dividend engine.

As President and CEO Aurora Davidson stated, “A performance dividend underscores Amerigo’s ability to promptly and effectively share the benefits of strong copper prices with our shareholders.” This isn't just corporate rhetoric; it's a direct reflection of a financial position strong enough to support its core business, its regular quarterly dividend, and its share buyback program, with enough left over to issue special rewards when market conditions align.

The Engine of Innovation: Processing Yesterday’s Waste

What truly sets Amerigo apart from its peers is its core business model: it is not a traditional mining company. Instead, it operates as a sophisticated processing firm, extracting valuable copper and molybdenum from the fresh and historic tailings of Codelco's El Teniente mine in Chile—the world's largest underground copper mine. This “tailings-to-treasure” approach is a masterstroke of industrial innovation and sustainability.

By focusing on processing byproducts, Amerigo sidesteps the immense geological risks and staggering capital expenditures associated with mineral exploration and mine development. Its raw material supply is secured through a long-term, strategic partnership with Codelco, the world's largest copper producer. This creates a predictable operational framework that is the envy of many junior miners. The model is an elegant example of a circular economy in action, turning what was once considered waste into a valuable resource, thereby reducing the environmental footprint associated with traditional mining.

This operational efficiency translates directly to the bottom line. With lower inherent risk and more stable production inputs, Amerigo can achieve strong margins and predictable cash flows, particularly in a strong commodity price environment. This innovative foundation is what allows the company to confidently execute its capital return strategy, as its profitability is less dependent on the high-stakes gamble of new discoveries and more on the consistent, technological refinement of its processing capabilities.

Copper’s Bull Run as a Strategic Tailwind

Amerigo's dividend declaration also serves as a potent barometer for the global copper market. The company’s confidence to issue a performance dividend stems from a bullish outlook on the red metal, supported by both current pricing and long-term demand fundamentals. In the third quarter of 2025, Amerigo realized an average copper price of $4.54 per pound, a marked increase from $4.22 per pound in the same period of 2024. Prices continued to climb into early October, reaching $4.70 per pound.

This price strength is not a fleeting anomaly. It is underpinned by a structural shift in global demand. The transition to a green economy is profoundly copper-intensive. Electric vehicles require several times more copper than their internal combustion counterparts, and the build-out of renewable energy infrastructure—from wind turbines and solar panels to the grid upgrades needed to support them—is fueling a voracious appetite for the metal. Amerigo's leadership has noted its expectation for “stable to long-term rising copper prices,” and its capital allocation decisions are a clear vote of confidence in that forecast.

By linking its performance dividends to these strong prices, the company allows its shareholders to participate directly in the upside of these powerful macroeconomic trends. The dividend becomes more than a return on investment; it’s a share in the profits of the global energy transition.

A Masterclass in Capital Return

The final piece of the puzzle is Amerigo’s deliberate and multi-layered Capital Return Strategy (CRS). Implemented in October 2021, the CRS is a comprehensive framework designed to maximize shareholder value through three distinct mechanisms: a base of regular quarterly dividends, opportunistic share buybacks, and flexible performance dividends. The strategy has been remarkably effective, returning a total of $93.7 million to shareholders since its inception.

This isn't just about paying dividends; it's about holistically managing the company's capital structure for shareholder benefit. Through its Normal Course Issuer Bid (NCIB), Amerigo has repurchased and cancelled millions of shares, including 3.97 million in 2025 alone. This has reduced the total number of common shares outstanding by 14% since the program began, increasing each remaining share’s claim on future earnings.

The performance dividend, as Davidson noted, is an “additive component” that complements the other two pillars. The company maintains a disciplined approach, only triggering these special payouts when its cash balance exceeds a self-imposed floor of $25 million and its forward-looking view on copper is positive. This ensures that the company’s generosity does not compromise its operational stability. This three-pronged strategy offers investors a compelling combination of stable income, upside potential, and a shrinking share count, representing a sophisticated approach to creating and distributing value in the modern industrial economy.