Fresnillo (LSE:FRES) reported a standout performance for 2025, benefiting from stronger precious metals prices, improved operational efficiency, disciplined cost management and the favourable impact of peso depreciation.
Silver production met the company’s guidance targets, while gold output exceeded expectations, helping adjusted revenue rise nearly 28% to US$4.6 billion. Gross profit more than doubled year-on-year to exceed US$2.6 billion, reflecting both stronger market conditions and operational improvements across the business.
The mining group significantly increased shareholder returns through a sharply higher total dividend and also strengthened its international footprint with the acquisition of Canada-based Probe Gold. Management described the deal as a disciplined expansion into a Tier 1 mining jurisdiction that broadens Fresnillo’s long-term resource base.
The company also pointed to a more supportive political environment in Mexico, continued progress across development and exploration projects, and ongoing investment in decarbonisation initiatives and water stewardship programmes. Fresnillo said it remains positive on the long-term outlook for both silver and gold demand, although it acknowledged continuing geopolitical uncertainty and confirmed that two fatal incidents occurred during the year.
The company’s broader outlook is underpinned by strong financial performance, including a sharp recovery in profitability and cash generation alongside relatively low leverage levels. Investor confidence is also supported by a solid development pipeline and positive management guidance. However, near-term technical indicators remain softer, with the shares trading below their 20-day and 50-day moving averages, while valuation metrics suggest the stock is not especially cheap at around 23 times earnings. Management also highlighted potential headwinds linked to 2026 being a transition year, including higher capital expenditure and tax-related cash flow pressures.
More about Fresnillo
Fresnillo plc is the world’s largest primary silver producer and Mexico’s largest gold miner, with shares listed in both London and Mexico. The company operates eight mines in Mexico and maintains an extensive portfolio of exploration and development projects across Mexico, Peru and Chile, focused on preserving its leadership position in silver and gold production.
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