Aris Mining's Expenses are on the Rise: Will It Affect Margins?

Aris Mining Corporation ARMN is plagued by elevated cost pressures. In the third quarter of 2025, ARMN reported an increase in its all-in-sustaining costs (AISC) per ounce, a key indicator of cost efficiency in mining. The Segovia Operations in Colombia, a cornerstone of Aris Mining's portfolio, reported AISC of $1,641 per ounce, up from $1,540 in the year-ago quarter, due to higher sustaining capital expenditures. The company’s consolidated AISC increased 6.6% year over year to roughly $1,641 per ounce.

The increase in ARMN’s costs in the third quarter was mainly due to higher volumes of purchased mill feed from Contract Mining Partners, as well as increased royalty and social contribution expenses tied to higher gold prices and stronger sales volumes. Mining costs also rose as a result of greater throughput and the ramp-up of operations following the commissioning of the second mill at Segovia.

Despite these headwinds, Aris Mining’s profitability remains resilient. The company’s AISC margin stayed strong, rising 36% sequentially and 42% year over year in the third quarter. This improvement was supported by higher realized gold prices and increased sales volumes, which significantly boosted gold revenues.

While Aris Mining’s expenses are increasing, they are mainly tied to strategic, growth-oriented initiatives. Supported by rising gold prices, increasing output and disciplined cost management, the company is well-positioned to sustain healthy margins and continue executing its long-term growth strategy.

AISC of ARMN’s Peers

Among ARMN’s major peers, Agnico Eagle Mines Limited’s AEM AISC was $1,373 per ounce in the third quarter of 2025, increasing 7% year over year. Agnico Eagle forecasts total cash costs per ounce in the range of $915-$965 and AISC per ounce between $1,250 and $1,300 for 2025, suggesting a year-over-year increase at the midpoint of the respective ranges. While Agnico Eagle is taking actions to control costs, the inflationary pressure is likely to continue over the near term, weighing on its profit margins and overall financial performance.

ARMN’s another peer, Newmont Corp. NEM reported AISC for gold of $1,566 per ounce in the third quarter of 2025, down around 2.8% year over year. However, Newmont expects gold AISC for the total portfolio to be $1,630 per ounce in 2025, reflecting a year-over-year rise. The benefits of Newmont’s cost-saving actions are expected to be more than offset by higher royalties, production taxes and costs from profit-sharing agreements.

ARMN’s Price Performance, Valuation and Estimates

Shares of Aris Mining have surged 65.3% in the past three months compared with the industry’s growth of 22.3%.

From a valuation standpoint, Aris Mining is trading at a forward price-to-earnings ratio of 7.30X compared with the industry’s average of 13.56X. ARMN carries a Value Score of D.

The Zacks Consensus Estimate for Aris Mining’s earnings has increased 32.5% in 2025 over the past 60 days.

The company currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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