Coeur Mining Inc
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Q4-2025 Earnings Call
AI Summary
Earnings Call on Feb 19, 2026
Record Performance: Coeur Mining delivered record Q4 and full-year results, with silver and gold production up 57% and 23% year-over-year, respectively.
Profitability Surge: Full-year EBITDA more than doubled to over $1 billion, and free cash flow swung from negative $9 million in 2024 to $666 million in 2025.
Cash Strength: Year-end cash jumped over tenfold to $554 million, and net income increased tenfold to a record $586 million.
Rochester & Las Chispas: Rochester saw major production gains and $78 million quarterly free cash flow; Las Chispas generated $286 million in free cash flow over 10.5 months.
Exploration Success: Reserves grew by 10% and inferred resources by 40%; significant new discoveries and mine life extensions were achieved.
2026 Outlook: Guidance calls for a 10% increase in silver production and growing silver revenue share, with a strong start to the year and promising exploration plans.
New Gold Acquisition: The New Gold transaction is expected to close in the first half of 2026, with the combined company targeting $3 billion in EBITDA and $2 billion in free cash flow on a run-rate basis.
Capital Returns: Management signaled an intent to update its capital return priorities, with a slight preference for buybacks but considering dividends as well.
2025 was a standout year for Coeur Mining, with record silver and gold production driven by the Rochester expansion, the Las Chispas acquisition, and strong performance across its North American operations. Rochester delivered record quarterly and annual output, while Las Chispas quickly became the company’s top cash flow generator. Palmarejo and Kensington also reported strong quarters, and all five main assets met or exceeded annual guidance.
Coeur’s financial results were transformative, with EBITDA rising over 200% to $1 billion and free cash flow swinging from a negative to $666 million. Year-end cash exceeded $554 million, and the company moved to a net cash positive position. Every mine generated at least $50 million in Q4 free cash flow, and return on invested capital reached 26%. Total liquidity neared $1 billion after significant debt reduction.
Exploration investments paid off in 2025, with reserves rising 10% and inferred resources up 40% across the portfolio. Wharf and Palmarejo saw particularly large increases, with new discoveries and extended mine lives. Aggressive exploration is planned for 2026, with a record budget primarily allocated outside current stream areas to unlock further upside.
2026 production guidance predicts a 10% increase in silver output, with silver expected to account for about 42% of total revenue. Rochester is expected to ramp further, Las Chispas will contribute a full year, and Wharf is set for a second-half weighted recovery after repairs. Updated combined guidance will be issued after the New Gold transaction closes.
The New Gold transaction, on track to close in the first half of 2026, will add two Canadian assets and further lower costs, diversify the geographic footprint, and improve margins. Management expects the combined entity to achieve $3 billion in EBITDA and $2 billion in free cash flow on a full-year run-rate basis, excluding contributions from the new assets in current guidance.
Management reiterated a disciplined capital allocation approach, with a continued focus on exploration, debt reduction, and shareholder returns. The company partially executed its $75 million buyback in 2025 and plans to update its return of capital strategy—potentially favoring buybacks for flexibility, but considering dividends as well—after the New Gold deal closes.
Cash tax guidance for 2026 is $400–500 million, with about 80% relating to Mexico. U.S. tax pools are being depleted rapidly due to high profitability and will likely be exhausted within two years, after which U.S. cash tax payments will increase.
Operationally, Rochester focused on improving crusher throughput and recoveries; silver recoveries are expected to improve as crush size targets are met. Wharf experienced a crusher-related outage but implemented interim measures and expects repairs by Q2 2026. No new hedging is planned for gold or silver prices, with the company opting to remain exposed to the market.
Good day, and welcome to the Coeur Mining Fourth Quarter 2025 Financial Results Conference Call [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Mitchell Krebs. Please go ahead.
Good morning, everyone, and thanks for joining our call today to discuss our fourth quarter and full year results. Before we start, please note our cautionary language regarding forward-looking statements and refer to our SEC filings on our website. One housekeeping item. You may have noticed, we shifted our reporting to metric units starting this quarter based on feedback we received and to better align with our peers. .
You'll see that prior period figures in the earnings release have been recast for comparability and additional details are provided. Our record fourth quarter results capped off an incredible year for the company that was full of all-time bests and record achievements. I want to take a couple of minutes to run through a few of them, some of which are shown on Slide 4. Record full year silver and gold production increased 57% and 23% year-over-year, respectively, driven by the impact of the Rochester expansion, the acquisition of Silvercrest in February, and consistent performance from our 3 other North American operations.
Full year record EBITDA increased 200% to over $1 billion and full year free cash flow increased to $666 million versus negative $9 million in 2024. Slide 8 does a nice job summarizing how far we've come in just the last couple of years when EBITDA was just $142 million and free cash flow was negative $297 million. Our year-end cash increased more than 10x to $554 million, and net income last year also increased tenfold to a record $586 million.
Our 3 U.S. operations accounted for nearly 60% of our 2025 revenue and silver represented about 35% of total revenue last year. Rochester made consistent progress toward achieving steady-state levels throughout 2025, with full year silver and gold production increasing 40% and 54% year-over-year, respectively. In the fourth quarter, Rochester made a strong statement by delivering record quarterly crush tons and placed tons, along with $78 million of free cash flow which sets us up for an even stronger 2026 at America's largest source of domestically produced and refined silver.
Las Chispas finished the year as our top cash flow generator with $286 million of free cash flow in only 10.5 months of contribution. Just as important was the successful and safe integration of Las Chispas last year, which deserves a big shout out to the entire team. On the exploration front, and our year-end reserves and resources that we issued yesterday, it's really gratifying to see the success of our sustained exploration investments and how they continue to drive up our overall ROIC and extend our mine lives, which Slide 16 does a good job of highlighting.
The Wharf reserve and inferred resource increases and the near doubling of its mine life to 12 years was especially eye-popping and the Palmarejo results that drove a 5-year extension to its mine life were also very impressive, especially the resource growth off to the East. It was also great to see that we replaced a year of mine life at Las Chispas to remain at approximately 7 years. Looking ahead to 2026 and beyond, -- it's clear that Coeur is in the strongest position it's ever been in its 98-year history and is poised to deliver another record year this year.
Our newly issued stand-alone production guidance summarized on Slide 6, and reflects solid year-over-year growth, especially in silver with a 10% expected year-over-year increase, which incorporates a full year of production at Las Chispas and another expected step-up in performance at Rochester. Between higher silver prices and this expected growth in our silver production, silver is expected to contribute approximately 42% of our total 2026 revenue based on current prices and the midpoint of guidance.
And with the expected first half closing of the New Gold transaction, 2026 will represent an even more significant step change in the quality, scale and resiliency of core, which is highlighted on Slide 7. Adding New Gold's to Canadian operations will further reduce our cost profile and enhance our geographic footprint for investors seeking lower risk silver and gold exposure and peer-leading margins. This new and unique platform is emerging at precisely the right time and will be ideally positioned as the industry's only all North American senior producer with a cash flow, liquidity and market profile that is unmatched in the precious metals sector.
As we said on the November conference call, when we announced the New Gold acquisition, we expect the combined company to generate approximately $3 billion of EBITDA and $2 billion of free cash flow on a full year run rate basis based on consensus commodity prices from last October. I'll note that the guidance we issued today does not yet include contributions from the New Gold assets, which will be incorporated in the Coeur's production profile following the close of the transaction.
Looking out over the next few weeks, we anticipate an active flow of news, including the close of the New Gold transaction, which remains on track, and we believe has a good chance to close by the end of the first quarter. Updated SK 1300 technical reports for New Afton and Rainy River will be filed upon closing of the transaction, which will incorporate year-end 2025 reserves and resources for both assets including a maiden resource at New Afton's K zone. We will also provide updated guidance for the combined company and share details of our updated capital return priorities once the transaction closes.
Before handing the call over to Mick, I'll close with a big thank you to the team for the incredible amount of work that has gone into getting the company to where it is today. Closing out strongly in the fourth quarter is always a challenge and year-end reporting is always a heavy lift. But these efforts are even more impressive this time around in light of the new Gold transaction and the related integration planning process. Higher prices certainly helped, but there's absolutely no doubt that we're as well positioned as we are because of the talent, resiliency and dedication of our people across the entire organization. Mick, over to you.
Thanks, Mitch. Our fourth quarter was a 24 of the core portfolio, with all 5 main hitting the straps in a safe and environmentally soman. Strong finishes at all of the mines, especially at Rochester, helped ensure the achievement of our annual 2025 production and cost guidance. Consolidated production for the quarter totaled 112,000 ounces of gold and 4.8 million ounces of silver. Adjusted cash per ounce for gold and silver also continued to be well managed with an impressive $1,207 per ounce and $17.29 per ounce, respectively and allowed for strong margin expansion across the business.
Turning to the assets and beginning with Las Chispas. The team turned in another solid quarter to cap off a great 2025 in its first year in the core portfolio. Silver production of 1.4 million ounces and gold production of 15,000 ounces led to $79 million of quarterly free cash flow. The operations 2026 guidance reflects a full year of production compared to the approximate 10.5 months of 2025 contributions.
Turning to Palmarejo. The main followed up 1 of its strongest quarters in terms of tonnes milled with an even better result in the fourth quarter with over 470,000 tonnes milled averaging over 6,000 tonnes per day. Together with strong grades and recoveries, Palmarejo's free cash flow totaled $63 million. The team in Chihuahua has demonstrated great results with its fill a mill strategy, a unique skill set that we expect to leverage at Rainy River in the future, which is undergoing a similar transition from open pit operations to underground.
Our 2026 guidance points to another great year ahead for Palmarejo. Turning to Rochester. Key performance metrics along the crusher circuit saw marked improvement versus the prior quarter, concurrent with the fourth quarter completion of planned modifications and belt improvements. We exceeded 7 million tons or 6.4 million metric tons crushed this quarter, which was a nice achievement for the team. It has been impressive to see the main steady improvements in silver and gold production as the power of the new crusher train continues to drive results, reaching their highest levels in 2025 at 1.7 million ounces of silver and 17,000 ounces of gold, respectively, in the fourth quarter.
On an annual basis, the positive impact of Rochester's larger scale really stands out with silver and gold production increasing 40% and 54%, respectively, compared to 2024. I'm pleased to report that the average particle size continued to beat the budget level for material passing through all 3 stages of crushing at a PAD around 0.84 inch in the fourth quarter. Importantly, related recoveries continue to track our PSD models as expected. The team is also hard at work on the next phase of the leach Part V expansion, most of which we expect to complete this year.
Rochester is well positioned for an even stronger 2026. We are off to a great start with over 2.3 million metric tons crushed in January. Grades are expected to be lower in the first half of the year, consistent with the main plan, which is reflected in our 2026 guidance. Our long-term focus remains on building consistency and momentum through the 3-stage crushing line and continuing to deliver quarterly crush tons in the 6.2 million to 7.2 million metric tons per quarter range as we drive towards our ultimate objective of a top size of 5/8 of an inch.
Based on the midpoints of our 2026 guidance ranges, we expect silver and gold production to increase substantially compared to 2025. Moving to Kensington. The positive benefits of their multiyear underground development program continue to manifest in the form of new efficiencies and operational flexibility. The team knocked it out the park with its highest tonnes milled and gold grade of the year in the fourth quarter, leading to gold production of 30,000 ounces and the main's lowest quarterly cash of the year at $ 1,533 per ounce. This led to quarterly free cash flow of $51 million, Kensington's best result ever.
Coupled with the successful reserve additions announced yesterday, the main remains on excellent footing and well positioned to deliver a strong 2026. Finishing up at Wharf, quarterly gold production totaled 25,000 ounces leading to free cash flow of an impressive $62.3 million. These good results were overshadowed by a fare in the mains tertiary crusher following routine maintenance in the fourth quarter. The tertiary crusher area sustained some damage in the upper levels, impacting conveyor belts, ancillary equipment like the Host, Korean and electrical systems, and those parts will need to be repaired or replaced.
There was no damage to the 4 tertiary corn crushers in that area on the ground floor. The team quickly mobilized temporary mobile pushing units at site in January to supplement crushed ore tons. Repairs are expected to be completed over the course of the second quarter. Slide 6 provides an indicative expectation for 2026 quarterly production showing a second half weighted crushed tonnes as the site returns to normal operations throughout the year.
As highlighted in yesterday's reserves and resources update, the future of is more exciting than ever. Thanks to the reselling success, recent exploration and technical work that have unlocked new gold reserves, leading to a near doubling of manage with additional upsade remaining from a significantly larger resource pipeline. We look forward to many great years ahead of this one-of-a-kind asset. With that, I'll pass the call over to Eva.
Thanks, Mick. 2025 was a very successful year for exploration with great results seen across the board. Key highlights include not only replacement of depletion across the portfolio, but growth of reserves by 10%. As Mitch and Mike have mentioned, Wharf and Palmarejo were standard contributors in this regard. Inferred resources also grew by a whopping 40% across the portfolio, led by a 216% increase at Wharf an 86% increase at Palmarejo and 30% growth at Rochester.
Moving to key highlights for the year. At War, the Juno North Foley and edge exploration and technical programs were very successful. In addition to increasing gold reserves by 500,000 ounces, 1 million ounces of inferred resources were added. This is a phenomenal result for relatively modest levels of investment, and it has set us up for another year of conversion to reserves in 2026 and in the future. Earlier-stage scout work will also restart this year to help build an even longer-term future of this operation. We had a very busy year at both Mexican operations with up to 26 rigs across both sites.
At Palmarejo, reserves saw a very large increase of almost 40% and moving from 1.4 million ounces on a gold equivalent basis to 2 million ounces. Our other key aim of bolstering the inferred pipeline was very successful with over 1 million gold equivalent ounces added, and this is in addition to 400,000 new ounces in the measured and indicated category. The non-FrancoNevada area of interest deposits of La Union, San Miguel and independency Asur were key contributors along with Hidalgo on the main mine corridor.
All these deposits will continue to undergo aggressive exploration in 2026, along with ongoing early-stage work across the district. Atlas Cheese bus exploration programs resulted in maintaining mine life in addition to the discovery of multiple new veins, including Augusta, lapromesa and Lupita. The exploration pace is expected to continue at similar levels in 2026, involving a healthy mix of scout expansion and infill drilling. Programs at the other sites also fulfill their aims as laid out at the start of 2025 with depletion more than replaced at Kensington and nearly replaced at Rochester.
Our understanding of the system at Silvertip is progressing rapidly, and program successfully grew the mineralized footprint by another kilometer to the site. This gives a new focus area for infill drilling over the coming years in order to support the study programs underway. Looking ahead to 2026, total exploration investment is expected to increase to between EUR 120 million and EUR 136 million. to continue pursuing the high return opportunities we have across the portfolio. With that, I will turn the call over to Tom.
Thanks, Ita. Beginning with the financial summary on Slide 10. We are excited to reveal the record-setting full year results that Mitch highlighted a few minutes ago. It was truly a transformative year. There were so many highlights in quarterly financial records to choose from, but here are a few of our favorites. It was particularly gratifying to see every mine deliver at least $50 million of free cash flow in the quarter. .
We saw a 66% increase in free cash flow to $313 million during Q4, highlighted by Rochester's $78 million of quarterly free cash flow. Adjusted EBITDA margin increased 63%, which was a 60% increase quarter-over-quarter. Our return on invested capital was a peer-leading 26% in 2025. Quarterly realized gold and silver prices increased 21% and 40%, respectively, and have only continued to strengthen in 2026. We are expecting another record-setting year in 2026 for the CDE stand-alone portfolio and look forward to providing updated guidance, including Rainy River and New Afton once the transaction closes.
One note of caution, Q1 is always seasonally low from an operating cash flow profile with significant year-end payments primarily related to Mexican tax and our annual incentive plans. As shown on Slide 9, you can see the net effect of this cash deluge coursing through Coeur's balance sheet. As previewed during last quarter's call, we achieved our long-standing goal of being net cash positive. Total debt declined $250 million or 42% year-over-year, and we ended the year with a cash balance of $554 million and now have total liquidity nearing $1 billion in climbing.
We made some progress on our $75 million buyback program that we announced during the second quarter. We were fairly limited in our ability to execute the buyback program during the second half of the year due to trading restrictions related to the New Gold transaction. This limitation will end upon the closing of the transaction when we intend to announce a robust update to our return of capital strategy. Our capital allocation framework will remain disciplined with a continued focus on generating strong returns on invested capital and deploying excess cash where it creates the greatest long-term value for stockholders.
Concurrent with the strengthening price environment, we enhanced our annual guidance related to cash taxes and royalties to reflect the champagne problems of higher commodity prices. One final update for me. We look forward to the closing of the New Gold transaction and welcoming our new Canadian colleagues to the core team. Robust integration planning has been underway since mid-November, and we are prepared for day 1 after closing. With that, I'll now pass the call back to Mitch.
Thanks, Tom. Before we open it up for Q&A, I just want to touch on several key priorities and themes for the year ahead on Slide 18. Of course, continuing to build on our safety and environmental performance always remains priority #1, successfully closing the New Gold transaction and accomplishing a smooth integration is obviously a critical priority for the year. A full year of steady contribution from Las Chispas, a further step up at Rochester, and delivering on Wharf's back-half-weighted plan are also key drivers for the year ahead.
And as Ifo mentioned, we are allocating a record amount of capital to exploration investments in 2026 and a 47% increase compared to 2025 levels, delivering the expected results from these programs to keep driving our ROIC higher and adding mine life is also a key priority in 2026. At Silvertip, we plan to continue advancing the project with a potential transition into a pre-feasibility study based on the results of the initial assessment that is now wrapping up. With higher silver prices, continued drilling success, solid project front-end loading and Canadian support for critical minerals projects like Silvertip, there could be an attractive path forward to adding to our future silver profile that we look forward to evaluating together with our Board.
And finally, we look forward to updating you on the impacts of the New Gold transaction once it closes with combined full year guidance reserve and resource updates from New Afton and Rainy River and details regarding the path forward for returning capital to stockholders. With that, let's go ahead and open it up for questions.
[Operator Instructions] And the first question today comes from Wayne Lam with TD Securities.
Congratulations on a good quarter. Maybe I just want to start off with a question on the reserve grades at Lesiba. It seems as though there was a big part taken on the grades now in the past couple of years. Is that a function of a lower cutoff grade or reinterpretation there? And then just given the mine grades have been well ahead of reserves since the start-up of the mine, when will we start to see a bit of a normalization of the grade profile there?
Yes, sure. Wayne, thanks for those questions. I'll start, and Mick if, if you want to chime in. I think on the last chip grade profile, it really reflects a more conservative approach to the modeling that we took here after taking the reins last February, it's consistent with how we do it at our other mines. It's something we had identified in the diligence actually that grade was being overestimated, tons underestimated. And so after operating it for 10.5 months, we incorporated that into the year-end resource model. But Mick, anything you want to add to that or Ifa?
Yes. From an operational perspective, that is what we expected. And after running the site for a year, that's exactly what we found. I reconciled very well to the due diligence that we saw -- we tested the plant to make sure that it could run at those slightly higher run rates to make sure we're going to still deliver against the budget, and we did exactly that. Aoife any thoughts .
Yes. And I think -- it's certainly not due to disappointing drill results. I think we've actually seen the opposite that this year, particularly at last cuspshere we had, in our due diligence and our expectations for lower grades in that block. So we've been very pleasantly surprised with the tenor of the gray out there as well. .
And so to an second question about just go-forward grades, should we see more of a tighter fit between reserve grades and actual results .
Yes. And as we're seeing that, we saw some of that, and we thought would trend in that direction, and that's what we did. So going forward, we should see that normalize to the expected planned levels.
Does that help .
Yes, that's really good color. Maybe on the exploration results, a pretty good update on the resource additions across the portfolio. Just wondering on the maiden resources you guys report at East Palmarejo. Are those all outside of the Franco stream and when could we envision those being brought into production? And then just wondering with the guided sales under the stream in the 40% to 50% range this year, which is slightly lower year-over-year. How should we be thinking about that number over the next few years? And should we expect that to continue to decline?
Yes. Yes, I'll start off and then maybe Tom, on the -- or Mick, on the shape of the percentage inside and outside over time. But in short win, all of those ounces are outside of the area of interest that the Franco-Nevada gold stream covers. The bulk of them were further off to the east out there in that Guazapares area that Aifo mentioned. And so the near-term stuff, the Independencia kind of extension of Independencia down there to the south and east, that represents a near-term opportunity for us.
And then in the meantime, we'll continue to expand and extend hopefully those resources off there further to the east, and that can develop a potential future source of ore or maybe even a stand-alone operation depending on on where we end up with that additional drilling here over the next few years. In terms of percentage inside, outside. How should we think about that?
Yes. It's virtually all inside the AOI for the next couple of years until we get some more success in the areas that you just described in.
But exploration-wise, we'll be this year, 70% or so of the exploration budget of Palmarejo will be outside of the area interest over there to the east lane. .
Do you want me to comment on Itami because that is bigger area is close to infrastructure underground and so there's some ventilation work that we'll need to do to develop that and some minor permitting. But Aifo and the team characterized that better, then that will certainly fall into the nearer term next few years as we get a little bit of EY and look at that balance. .
And in terms of the upside that rotor is with a number of deposits sector like San Miguel is a Golden Solera Union is predominantly gold. So it's really going to give us some nice operational flexibility as we develop that further in the next number of years. .
Okay. Perfect Yes. sounds like quite a considerable future opportunity. So I appreciate the detail on that. Maybe just last 1 for me. Just on the cash tax guidance of $400 million to $500 million this year. Do you have any additional color on what a breakdown of that looks like between Mexico versus the other operations? And just wondering if you still have tax pools to draw on, particularly in the U.S. Or does that guidance assume at some point, full depletion of those capital pools?
Tom, do you want to take that? .
My favorite. Thanks, Wayne, for using the tax question. I would think 80% of the taxes are in Mexico. And so we are going to be paying some cash tax in the United States and it's just mainly because of the way the tax pools or the tax losses work. We will be sheltering the bulk of of net income, but there's still going to be a little bit that ends up being paid. So if you want to use that 80-20 breakdown and apply that to the guidance, that would be my -- that's the guidance. .
Okay. Great. That's really good color. Congratulations again on a good quarter and looking forward to seeing the closing of the New Gold transaction. one? .
Yes. No, thanks for the question, Wayne. .
And your next question comes from Josh Wolfson with RBC. .
Just looking forward at the upcoming closing and the capital returns comments that were made earlier. Is there any kind of preference the company has in terms of dividends or buybacks here and as the company thinking about those 2 aspects, apologies, not to totally front run your upcoming announcement. .
Yes. We don't want to steal our own thunder before we get to the closing when we'll roll out a more a clearer path forward on return of capital. But suffice to say, those are the 2 levers that we've been looking at and thinking about and talking about with our Board obviously, a slight preference more for the buyback route, just given the flexibility that, that provides. But recognizing that, look, as -- on a combined basis, you look at across the peers, and we're sensitive to making sure that we're -- we're benchmarking well against the peers as far as how we think about returning excess cash back to our stockholders. .
All right. And then another question sort of along the same lines. Given the financial positioning and free cash flow outlook, the company has been active in increasing the exploration budgets and investment across the portfolio. How are you thinking about that from the New Gold assets? Is there anything that you can look to accelerate in 2026? There are any specific opportunities at least some of the early integration analysis? .
Yes. Yes. No, thanks, Josh. Good question. I think let's get past the close and the integration, ensure continuity, but we are looking at how can we allocate some additional capital to exploration at both sites, in particular, probably Rainy River, as you think about some of the regional opportunities there on that big land package. But I think we want to take a little bit of time to make sure we've got our ducks in a row, got the team aligned and then we take the next step as far as potentially ratcheting up the level of investment in exploration, in particular, at Rainy River. If anything you want to say? .
No, that's -- you want to cover time .
Some great opportunities there. I mean both, obviously, both operations. But I think at Rainy River, we'll apply that same playbook, Josh, that we've used successfully at our other operations, and it takes time and capital. and some commitment. But I think over time, there's a lot of potential there. Yes, you bet. Thanks for the questions. .
And your next question today comes from Joseph Rieger with Roth Capital Partners. .
Just got to ask on Rochester, and I know Mick touched on it a bit. But I know that the model seems to be internally matching with the recoveries as we see them seem a bit light on the silver side, particularly -- at what point do you guys have to like go back and kind of like reassess the economics of the project? Or is it just a matter of getting the crush size to where it's supposed to be? And then do you expect the recoveries will improve accordingly. .
Yes, it's much the latter there, Joe, and Mike you can add to anything that I say. But -- you're right, the actual results are tracking model for the product size that we're putting out there on that Stage 6 leach pad as we continue that progression from a P 87% down to P85%. We'd expect to see the recoveries continue to track model and improve. Gold is less sensitive, but in particular, on the silver, we'd expect to see as we get closer to that 5.8%. Those recoveries ratchet up to just shy of 60% level. It's just, as you know, Joe, it's lower and longer on the silver recovery curve relative to gold. Mick, anything you want to add? .
Yes. And the focus in '25, as we said a few times, was really around getting that throughput level above the $7 million tons or the $6.2 million per quarter, and we're starting to get really into that range and look to make that sustainable. There was some really good development projects that we did in November to help us with that and to focus on the reliability of the crusher. .
And so though 2026 is really about trying to hone that in and drive those crush sizes down with the equipment that we've got and then a few small projects to be to get that in tune. But yes, it's a good path forward. And we're really in the range of what it said it would do on the packet. We've now just got to match the ore body knowledge with the capability of that crusher and make sure that it's in it every day. But overall, we're really happy about the progress so far.
Okay. And then 1 other one. Some of your peers have been maybe not successfully, but purchasing puts on things like gold and silver as a way to hedge downside given we've seen some record high prices. Is that something you guys are going to consider doing or I think in the past you used some collars or you guys given the cash flow situation of the company just going to kind of leave it exposed to the market?
Yes, you're right. As you recall, Joe, we did use some hedging during the Rochester capital project to kind of help shore up the the cash flow and the balance sheet. We're always looking at those things. But as we sit here today, we're going to let remain unhedged, keep focusing on what we can control on the cost side to keep pushing ourselves down the cost curve and retain that full exposure to prices. .
[Operator Instructions] Your next question comes from Brian MacArthur with Raymond James. .
So I go back to what Wayne was asking. I had the same question. Just on the tax pools, you made a comment that they're slightly different. I thought there were fairly substantial NOLs. Will they last like a number of years? Or are there something that -- obviously, we've got pretty good profitability now that we're going to use them up in 2 or 3 years. Or can I continue to think that on the U.S. operations, those will last like 3 or 4 years and you only pay fairly low taxes. Is that fair? Or is there something different in the structure of the NOLs based on your comments that it's not going to work that way?
Yes. So in the 10-K, look to the tax note. So we're down to $530 million year-over-year. It was $630 mill. So that gives you a sense that we used up about $100 million last year. And so again, at these prices, that's probably 2 years, Brian and we've blown through them. But again, just the way the limitations worked, some of the years you can only shelter 80%. And so that's why we're in a cash tax position in the United States this year. So I hope that gives you a sense.
Yes, that -- that's quite helpful. And just on the question about Palmarejo, as you find all this new ore that's off ground. I mean you mentioned we're going to stay up at a $40 or $50 for the next couple of years, let's say, does that drop -- I mean in the past, you've been down as low as 35%. Does that drop pretty substantially though, as we go out 5 years? Or if you're still just finding so much or at different areas, you just don't know what your sequences going to look like yet. .
Tom, do you want to .
Yes. Look, I mean, Aifoe and Mick are absolutely focused on finding is much of the as possible. At this stage, we do not have it, but we've highlighted all of the opportunities that are emerging, and I feel really excited about getting less of that production coming from from the area that's covered by the Franco stream, but for the near future, expect virtually all of the production to be subject to the stream.
And Brian, what's great there is obviously the Palmarejo reserve and resource increases were quite significant and in particular, that extension to the mine life. That's just building out more runway for us as we continue to allocate more and more of our exploration dollars off to the east to over time, develop that next chapter of Palmarejo more and more to the east over time, starting with the Independencia SER, extensional stuff, but then while we do that, we'll in parallel work to better define what that -- those further East deposits mean in terms of the future production profile. .
At Palmarejo. So it's a good strategy. It's taken a long time to kind of put all the pieces in place, but we just need to stick with it. And hopefully, over time, like Tom said, we'll see more and more opportunities open up to the east. And -- and over time, we'll make that slow transition.
No, I totally agree. I guess I was just trying to push a little bit to see when you saw that transition just when I was looking at it those additional years we are adding out. But that's okay. We can take that offline. .
This concludes our question-and-answer session. I would like to turn the conference back over to Mitchell Krebs for any closing remarks.
Okay. Well, we appreciate everybody's time today, and we look forward to speaking with you again in the spring to review our first quarter results. Thanks a lot, and have a great rest of the day. .
The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.