Fresnillo plc (LSE: FRES) edges higher as gold output shines over silver slump — will the rally extend into FY26?

Fresnillo plc (LSE: FRES) has extended its upward trajectory with shares closing at GBX 2,212.00 on 26 October 2025, reflecting a daily gain of 1.01%. The move capped off a volatile trading period where the share price rebounded after a brief dip, finding support well above the GBX 2,100 level. With the day’s range spanning from a low of GBX 2,118.00 to a high of GBX 2,214.00, investor interest remains elevated. A wide bid–offer spread of GBX 2,100 to GBX 2,600 indicates continued interest from speculative positions and institutional watchers alike, especially as volumes touched nearly 740,000 shares for the day with turnover exceeding £10.7 million.

Over a 12-month horizon, the turnaround in Fresnillo’s market narrative is remarkable. From a 52-week low of GBX 591.75, the share price surged to a peak of GBX 2,650.00 in recent weeks—translating into a near fivefold gain. At a current market capitalisation of approximately £16.3 billion, Fresnillo plc has reclaimed investor confidence, particularly as gold output trends remain resilient and operational setbacks in silver production appear priced in. The company continues to trade on relatively modest earnings per share of 0.19, which may suggest further upside if operational efficiency sustains in the upcoming quarters.

What do Fresnillo’s Q3 FY25 gold and silver production trends reveal about operational momentum?

Fresnillo plc’s third quarter production report for the three-month period ended 30 September 2025 confirmed diverging trajectories between gold and silver. Attributable gold production for the quarter came in at 151,256 ounces, down 4.1% from the previous quarter and 3.5% lower than the third quarter of 2024. In contrast, attributable silver production including the Silverstream contract totalled 11.68 million ounces, a decline of 6.6% on a sequential basis and 19.1% year-on-year.

While the company acknowledged silver production softness as expected—largely due to the cessation of mining activities at San Julián DOB and operational headwinds at Ciénega and Saucito—it remained confident in its full-year guidance. The decline in Silverstream volumes, which dropped over 56% quarter-on-quarter to just 195,000 ounces, exacerbated the headline fall in silver. In comparison, gold production remained relatively stable, supported by strong performance from mines such as Herradura and Juanicipio. On a year-to-date basis, gold production stood at 465,096 ounces, marking an 8.8% increase over the same period in 2024. Silver, however, posted a year-to-date decline of 14.2%, reaching only 36.56 million ounces by the end of the third quarter.

Which mines are driving Fresnillo’s performance and where are the production bottlenecks?

Operationally, the standout contributor was Herradura, which produced 87,389 ounces of gold in the third quarter despite a 9% quarter-on-quarter decline due to leaching cycle effects and planned ore grade transitions. Herradura’s year-to-date gold output has risen to 284,820 ounces, reflecting a 23.5% year-on-year increase, thanks to selective mining that prioritised higher ore grades. This strong performance, even with lower ore volumes processed, provided a crucial cushion to offset weaker silver performance elsewhere.

Juanicipio posted a solid quarter with gold output rising 18.2% versus the second quarter, reaching 6,599 ounces, while silver production climbed 3.0% to 2.43 million ounces. Higher ore grades, improved recovery, and increased throughput contributed to the performance. At Ciénega, gold production jumped 17.1% quarter-on-quarter to 11,170 ounces, largely supported by improved ore quality and leaching efficiency, although silver fell sharply due to lower grades and the higher oxide blend in flotation circuits.

Saucito remained a key silver contributor but saw production dip 4.6% to 3.39 million ounces as it battled slower mining cycles driven by reduced equipment availability and higher underground temperatures. Gold output at Saucito rose modestly to 18,789 ounces on better ore grades. Meanwhile, the San Julián Veins operation saw both gold and silver production decline sequentially, primarily due to lower ore grades consistent with the mine plan.

Ciénega also recorded its last quarter of zinc output after an internal economic assessment concluded that zinc concentrate production no longer contributed meaningfully to profitability. This strategic shift is expected to sharpen operational focus on higher-margin precious metals recovery.

Is Fresnillo on track to meet its FY25 gold and silver production guidance targets?

Despite production volatility, Fresnillo plc has reaffirmed its 2025 full-year guidance. Attributable silver production, including Silverstream, is expected to range between 47.5 and 54.5 million ounces. Gold production is forecast to land between 550 and 590 thousand ounces, with current trends pointing toward the upper end of this range. Lead production guidance stands at 56 to 62 thousand tonnes, while zinc is expected between 93 and 103 thousand tonnes.

When expressed in silver equivalent ounces using an 80:1 conversion ratio for gold, total 2025 output is projected at between 91 and 102 million ounces. This excludes contributions from base metals like lead and zinc. Notably, Fresnillo has also confirmed that its production expectations for 2026 and 2027 remain unchanged, signalling medium-term visibility and stable planning assumptions across its mine portfolio.

What does mine-level guidance across Herradura, Juanicipio, and Ciénega reveal for FY25 and beyond?

At Fresnillo’s flagship mine, average silver ore grades for 2025 are expected to remain in the range of 160 to 180 grams per tonne, with gold grades between 0.60 and 0.70 grams per tonne. Juanicipio continues to perform strongly with 2025 grade guidance set at 380 to 430 grams per tonne for silver and 1.2 to 1.4 grams per tonne for gold.

Herradura is forecast to maintain gold ore grades between 0.50 and 0.70 grams per tonne, reflecting its highly selective extraction strategy aimed at maximising yield even with lower tonnage. Meanwhile, Saucito’s full-year silver ore grade range stands at 200 to 220 grams per tonne, with gold between 0.90 and 1.10 grams per tonne.

At Ciénega, the strategic exit from zinc, lower sulphide presence, and a pivot toward higher gold recovery have become defining changes for the year. Ore grade expectations at this mine stand between 1.1 and 1.3 grams per tonne for gold, and 130 to 150 grams per tonne for silver.

How is the market evaluating Fresnillo’s Q3 results in light of precious metals price trends and asset rebalancing?

Fresnillo plc has re-emerged as a top-performing FTSE 100 miner, with many investors now weighing whether the company is quietly reorienting itself toward becoming a more gold-centric producer. Despite softness in silver, the operational stability of its gold-heavy assets, especially Herradura and Juanicipio, has helped maintain bullish sentiment.

Investor appetite appears driven by several factors: strong spot gold prices, global instability supporting precious metals as safe havens, and Fresnillo’s capacity to deliver production targets even amid asset transitions. That said, the sharp contraction in Silverstream contributions and challenges in high-temperature underground mining zones at Saucito remain risk watchpoints heading into the fourth quarter.

Given Fresnillo’s track record of operational transparency and consistent mine development updates, institutional confidence remains intact. Many market participants are now focused on whether Fresnillo can maintain elevated gold output levels while engineering a stabilisation in silver production by year-end.

Can Fresnillo sustain share price momentum and production confidence into FY26 and FY27?

With its share price consolidating just below recent highs, Fresnillo plc appears poised for further rerating—particularly if fourth quarter numbers confirm a strong finish to gold output and a narrowing silver deficit. Having rebounded from sub-GBX 600 levels just a year ago to the current GBX 2,212.00, the miner has already captured significant upside, but valuation multiples could expand further if EPS trends begin to reflect operational leverage.

Analyst sentiment remains positive overall, although cautious on silver-linked earnings. With a wide bid–offer range and strong turnover, the stock remains actively traded and visible to hedge funds, commodity-linked ETFs, and value investors alike. Institutional positioning may continue to favour Fresnillo as long as gold remains above USD 1,900 per ounce and Mexican mining operations retain high-grade stability across core assets.

Fresnillo’s rebalanced metals mix, combined with cost-optimised asset operation and predictable output, gives the company a solid foundation heading into FY26. Investors appear willing to give it the benefit of the doubt—even if the path forward for silver recovery remains uneven.

What are the key takeaways from Fresnillo’s Q3 FY25 production results and share price momentum?

• Fresnillo plc shares closed at GBX 2,212.00 on 26 October 2025, gaining 1.01% and extending a strong YTD rally from a 52-week low of GBX 591.75.
• Attributable gold production in Q3 FY25 reached 151,256 ounces, down 4.1% sequentially but up 8.8% year-to-date, with Herradura and Juanicipio leading output growth.
• Silver production fell to 11.68 million ounces, down 6.6% quarter-on-quarter and 19.1% year-on-year, largely due to the San Julián DOB closure and weaker grades at Ciénega and Saucito.
• Silverstream contributions plunged 56.9% versus Q2, tightening the company’s margin of error in meeting full-year silver guidance.
• Lead and zinc volumes dropped on weaker ore grades and lower throughput, with Ciénega officially exiting zinc concentrate production from Q3 onward.
• Fresnillo reaffirmed FY25 production guidance across all metals and maintained its 2026 and 2027 outlook, projecting 91–102 million ounces in silver equivalent output.
• Investor sentiment remains bullish with Fresnillo repositioning around gold stability, cost optimisation, and continued confidence in mine-level output resilience.
• The company’s performance is being closely watched by institutional investors amid high gold prices and global volatility supporting safe-haven assets.