paas12 31x2025mda

Extracted Document Text

This is a readable excerpt of the EGM normalized Markdown text. It helps search engines and researchers understand PDF, filing, or company-document content while the original source remains authoritative.

# paas12 31x2025mda

Source: https://www.sec.gov/Archives/edgar/data/771992/000077199226000019/paas12-31x2025mda.htm
Published: 2026-02-18T00:00:00+00:00
Fetched: 2026-05-05T09:39:46.922+00:00
Source artifact: 84803d8f-e3c7-48a8-98a4-471169c5d338
Normalizer input: text

## Content

# paas12 31x2025mda
EX-1.2
3
paas12-31x2025mda.htm
EX-1.2
Document Management’s Discussion and Analysis FOR THE YEAR ENDED DECEMBER 31, 2025 Management Discussion and Analysis For the years ended December 31, 2025 and 2024 (tabular amounts are in millions of U.S. dollars and thousands of shares, options, and warrants except per share amounts and per ounce amounts, unless otherwise noted) TABLE OF CONTENTS Introduction 2 Core Business and Strategy 3 MAG Silver Corp. Transaction 3 2025 Highlights 4 2025 Operating Performance vs Operating Outlook 5 Operating Performance 6 Project Development Update 10 Financial Performance 12 2026 Operating Outlook 19 Annual and Quarterly Financial Information 27 Operating M etrics 28 Alternative Performance Measures (Non-GAAP) 30 Risks and Uncertainties 40 Material Accounting Policies, Standards and Judgements 50 Related Party Transaction s 51 Disclosure Controls and Procedures 52 Mineral Reserves and Resources 53 Cautionary Note 57 PAN AMERICAN SILVER CORP. 1 Management Discussion and Analysis For the years ended December 31, 2025 and 2024 (tabular amounts are in millions of U.S. dollars and thousands of shares, options, and warrants except per share amounts and per ounce amounts, unless otherwise noted) MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS   February 18, 2026 INTRODUCTION This Management’s Discussion and Analysis (“MD&A”) is intended to help the reader understand the significant factors that influence the performance of Pan American Silver Corp. and its subsidiaries (collectively “Pan American”, “we”, “us”, “our” or the “Company”) and such factors that may affect its future performance. This MD&A should be read in conjunction with the Company’s audited consolidated financial statements for the year ended December 31, 2025 prepared in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board ("IASB") (the "2025 Annual Financial Statements”), and the related notes contained therein. All amounts in this MD&A, the 2025 Annual Financial Statements are expressed in United States dollars (“USD”) unless identified otherwise. This MD&A refers to various non-Generally Accepted Accounting Principles (“non-GAAP”) measures, such as "All-in Sustaining Costs per ounce sold”, “Cash Costs per ounce sold”, “sustaining capital”, “project capital”, “adjusted earnings and loss”, “basic adjusted earnings and loss per share”, "Attributable revenue", "Attributable cash flow from operations", "Attributable free cash flow", “total debt”, “capital”, and “working capital”, which are used by the Company to manage and evaluate operating performance at each of the Company’s mines and are widely reported in the mining industry as benchmarks for performance, do not have standardized meanings under IFRS Accounting Standards, and the methodology by which these measures are calculated may differ from similar measures reported by other companies. To facilitate a better understanding of these non-GAAP measures as calculated by the Company, additional information has been provided in this MD&A. Please refer to the section of this MD&A entitled “Alternative Performance (Non-GAAP) Measures” for a detailed description of “All-in Sustaining Costs per ounce sold”, “Cash Costs per ounce sold”, "sustaining capital", "project capital", “adjusted earnings”, “basic adjusted earnings per share”, "Attributable cash flow from operations", "Attributable free cash flow", “total debt”, “capital”, and “working capital” as well as details of the Company’s by-product credits and a reconciliation, where appropriate, of these measures to the 2025 Annual Financial Statements. Any reference to "Attributable" in this MD&A should be understood to reflect the Company's ownership share of results, which includes results from the operations that the Company has a 100% ownership interest in as well as from the operations, specifically the Juanicipio mine and the San Vicente mine, that the Company does not own a 100% interest in. Any reference to “Cash Costs” in this MD&A should be understood to mean Cash Costs per ounce of silver or gold sold, net of by-product credits (respectively, the "Silver Segment Cash Costs" or "Gold Segment Cash Costs"), presented on an Attributable basis. Any reference to “AISC” in this MD&A should be understood to mean all-in sustaining costs per silver or gold ounce sold, net of by-product credits (respectively, the "Silver Segment AISC" or "Gold Segment AISC"), presented on an Attributable basis. Except for historical information contained in this MD&A, the following disclosures are forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995 and forward-looking information within the meaning of applicable Canadian provincial securities laws, or are future oriented financial information and as such, are based on an assumed set of economic conditions and courses of action. Please refer to the cautionary note regarding forward-looking statements and information at the back of this MD&A, the “Risks Related to Pan American’s Business” contained in the Company’s most recent Annual Information Form on file with the Canadian provincial securities regulatory authorities and Form 40-F on file with the U.S. Securities and Exchange Commission (the “SEC”). Additional information about Pan American and its business activities are available on SEDAR+ at www.sedarplus.ca and with the SEC on EDGAR at www.sec.gov/edgar. PAN AMERICAN SILVER CORP. 2 Management Discussion and Analysis For the years ended December 31, 2025 and 2024 (tabular amounts are in millions of U.S. dollars and thousands of shares, options, and warrants except per share amounts and per ounce amounts, unless otherwise noted) CORE BUSINESS AND STRATEGY Pan American engages in silver and gold mining and related activities, including exploration, mine development, extraction, processing, refining and reclamation. The Company's portfolio of assets is located in Chile, Peru, Brazil, Mexico, Canada, Argentina, Bolivia, and Guatemala. In addition, the Company is exploring for new silver and gold deposits and opportunities throughout the Americas. The Company is listed on the Toronto Stock Exchange (Symbol: PAAS) (the "TSX") and on the New York Stock Exchange (Symbol: PAAS) (the "NYSE"). Pan American’s vision is to be the world’s premier silver mining company, with a reputation for excellence in discovery, engineering, innovation and sustainable development. To achieve this vision, we base our business on the following strategy: • Generate sustainable profits and superior returns on investments through the safe, efficient and environmentally sound development and operation of our assets. • Constantly replace and grow our mineral reserves and mineral resources through targeted near-mine exploration and global business development. • Foster positive long-term relationships with our employees, shareholders, communities and local governments through open and honest communication and ethical and sustainable business practices. • Continually search for opportunities to upgrade and improve the quality of our assets, both internally and through acquisition. • Encourage our employees to be innovative, responsive and entrepreneurial throughout our entire organization. To execute this strategy, Pan American has assembled a sector-leading team of mining professionals with a depth of knowledge and experience in all aspects of our business, which enables the Company to confidently advance early-stage projects through construction and into operation. MAG SILVER CORP. TRANSACTION On September 4, 2025, the Company acquired MAG Silver Corp. ("MAG") (the "MAG Acquisition"). MAG was a silver-focused mining company whose primary asset was a 44% interest in the Juanicipio mine ("Juanicipio") in Zacatecas, Mexico, operated by Fresnillo plc ("Fresnillo"), who holds the remaining 56% interest in Juanicipio. MAG's portfolio also included 100% ownership of the Larder exploration project in Ontario, Canada. Following the completion of the MAG Acquisition, the Company began reporting its Attributable share of the operating results, income and cash flows of Juanicipio. The Company has significant influence over its investment in Juanicipio due to its 44% ownership interest, therefore accounts for the investment using the equity method. However, the Company reports the production, Cash Costs, All-In Sustaining Costs ("AISC") and capital expenditures of Juanicipio on an Attributable basis reflecting the Company's 44% ownership share. Juanicipio AISC are reported on a per ounce of silver basis and are included as part of the Silver Segment AISC calculation. PAN AMERICAN SILVER CORP. 3 Management Discussion and Analysis For the years ended December 31, 2025 and 2024 (tabular amounts are in millions of U.S. dollars and thousands of shares, options, and warrants except per share amounts and per ounce amounts, unless otherwise noted) 2025 OPERATIONAL AND FINANCIAL HIGHLIGHTS Attributable silver production of 22.84 million ounces Attributable silver production for 2025 was 22.84 million ounces, 1.78 million ounces higher than the 21.06 million ounces produced in 2024. Attributable silver production in 2025 includes 2.49 million ounces from the Juanicipio mine, which was acquired in September 2025. Attributable gold production of 742.2 thousand ounces Attributable gold production for 2025 was 742.2 thousand ounces, 150.2 thousand ounces lower than the 892.5 thousand ounces produced in 2024, driven in part by the 77.4 thousand ounce decrease related to the sale of La Arena. Silver Segment and Gold Segment AISC (1) Silver Segment AISC excluding net realizable value ("NRV") inventory adjustments for 2025 of $13.88 per ounce were $5.10 per ounce lower than in 2024. Gold Segment AISC excluding NRV inventory adjustments for 2025 of $1,621 per ounce were $121 per ounce higher than in 2024. Income Statement, Cash Flow, Liquidity and Working Capital Position Revenue in 2025 of $3.6 billion was 28% higher than in 2024, primarily as a result of higher metal prices. Attributable revenue (1) in 2025 was $3.8 billion inclusive of the Company's 44% ownership share of revenue from Juanicipio. Net earnings of $980 million, or $2.56 basic earnings per share, were recorded for 2025, compared with net earnings of $113 million, or $0.31 basic earnings per share, in 2024. Adjusted earnings (1) of $959 million, or $2.54 basic adjusted earnings per share in 2025, compared to adjusted earnings of $287 million, or $0.79 basic adjusted earnings per share, in 2024. Cash flow from operations was $1,333 million in 2025, compared to $724 million generated in 2024. Attributable cash flow from operations (1) was $1,435 million in 2025, inclusive of the Company's 44% ownership share of cash flow from operations from Juanicipio. Attributable free cash flow (1) generated was $1,151 million in 2025, compared to $443 million

[Excerpt trimmed for readability. Open the original source for the complete filing or document.]