Hudbay Minerals (NYSE: HBM) lifts H1 profit and expands copper assets

Q: How did Hudbay Minerals (HBM) perform financially in Q2 2026?

Hudbay earned $138.1 million in net income on $631.3 million of revenue in Q2 2026. This compared with $114.7 million of net income and $536.4 million of revenue in Q2 2025, with EPS rising to $0.34 from $0.30.

Q: What were Hudbay Minerals’ (HBM) results for the first half of 2026?

For the six months ended June 30, 2026, Hudbay reported $1,388.6 million in revenue and $329.6 million in net income. This compares with $1,131.3 million of revenue and $213.9 million of net income for the same period in 2025, with EPS increasing to $0.82.

Q: What are the key terms of Hudbay Minerals’ (HBM) Copper World joint venture with Mitsubishi?

In January 2026 Mitsubishi acquired a 30% interest in Copper World, contributing about $422.7 million in cash at closing and $169.8 million of deferred consideration. Hudbay retains 70% and the cash is designated exclusively for Copper World’s development.

Q: What is Hudbay Minerals’ (HBM) cash position and liquidity as of June 30, 2026?

Hudbay held $890.9 million in cash and cash equivalents at June 30, 2026, including $334.5 million restricted to Copper World. Operating activities generated $508.3 million in cash in the first half, and the company had access to senior secured revolving credit facilities.

Q: How did streaming and hedging arrangements impact Hudbay Minerals (HBM) in 2026?

Gold and silver stream amortization totaled $29.1 million in the first half, with a small $0.1 million variable consideration reduction. Changes in fair value of financial instruments produced a $111.6 million net gain, mainly from investments at fair value through profit or loss.

Filing Impact

(Neutral)

Filing Sentiment

(Neutral)

Form Type

6-K

Rhea-AI Filing Summary

Hudbay Minerals reported stronger mid‑2026 results. For the three months ended June 30, 2026, revenue was $631.3 million versus $536.4 million a year earlier, with gross profit of $269.0 million versus $176.5 million. Net income was $138.1 million, up from $114.7 million, and basic and diluted earnings per share rose to $0.34 from $0.30.

For the six‑month period, revenue reached $1,388.6 million compared with $1,131.3 million, and net income increased to $329.6 million from $213.9 million, or $0.82 per share versus $0.55. Operating cash flow before working capital was $418.8 million, and after working‑capital movements cash generated from operations was $508.3 million, contributing to a period‑end cash balance of $890.9 million.

Hudbay completed significant strategic transactions. It acquired all remaining shares of Arizona Sonoran Copper Company through an all‑share asset acquisition that recognized a $1,357.0 million exploration property at the Cactus project and issued 46,794,082 Hudbay shares. It also formed a Copper World joint venture with Mitsubishi, recording $422.7 million of cash and $169.8 million of deferred consideration for a 30% non‑controlling interest. On the financing side, Hudbay repaid $472.5 million of 4.50% senior notes due 2026, drew $272.0 million on its revolving credit facility, and issued $52.0 million of 4.50% municipal bonds, leaving total long‑term debt at $860.2 million.

Positive

Revenue and profit growth: Q2 2026 revenue rose to $631.3 million from $536.4 million, with net income up to $138.1 million and EPS increasing to $0.34 from $0.30.
Strong first‑half performance: Six‑month revenue reached $1,388.6 million versus $1,131.3 million, and net income increased to $329.6 million from $213.9 million, with EPS rising to $0.82 from $0.55.
Copper World JV funding: The Mitsubishi joint venture generated $422.7 million cash plus $169.8 million deferred consideration for a 30% non‑controlling interest, dedicated to the Copper World project.
ASCU acquisition scale: The Arizona Sonoran transaction added an exploration property valued at $1,357.0 million, financed by issuing 46,794,082 shares, materially expanding Hudbay’s copper project pipeline.
Debt profile improvement: Hudbay repaid $472.5 million of 4.50% senior notes due 2026, leaving total long‑term debt at $860.2 million while maintaining ample liquidity.

Negative

None.

Filing Explained

At June 30, 2026, $334.5 million of cash and $49.8 million of bond proceeds were ring-fenced, while new land-payment obligations remained outstanding.

This Form 6-K furnishes Hudbay’s unaudited interim financial statements and related management discussion for the period ended June 30, 2026. At that date, some reported cash was earmarked for specific projects rather than general group use.

Of the reported cash and cash equivalents, $334.5 million was held at Copper World and designated for its exclusive use. Separately, $49.8 million of municipal-bond proceeds was restricted to qualifying Copper World expenditures, limiting the portion of reported liquidity available for other operations or debt service.

Outstanding capital commitments were $54.9 million in Manitoba, $14.0 million in British Columbia, $19.2 million in Peru and $114.5 million in Arizona; the filing states that most of the Manitoba and Arizona commitments could be terminated, while none in British Columbia could be terminated.

The Arizona Sonoran transaction also left deferred land-payment liabilities, including $5.0 million installments in each year from 2026 through 2028 and $82.2 million due on August 28, 2029. The filing identifies those installments and the expected use of the restricted bond proceeds within the next 12 months as the relevant liquidity milestones.

Key Figures

Q2 2026 Revenue: $631.3 million Q2 2026 Net Income: $138.1 million H1 2026 Revenue: $1,388.6 million +4 more

7 metrics

Q2 2026 Revenue $631.3 million Revenue for the three months ended June 30, 2026

Q2 2026 Net Income $138.1 million Net income for the three months ended June 30, 2026

H1 2026 Revenue $1,388.6 million Revenue for the six months ended June 30, 2026

H1 2026 Net Income $329.6 million Net income for the six months ended June 30, 2026

Cash and Cash Equivalents $890.9 million Cash balance as of June 30, 2026

Repayment of 2026 Senior Notes $472.5 million Principal of 4.50% senior notes due 2026 repaid on April 1, 2026

Copper World JV Cash Consideration $422.7 million Cash received at closing of Mitsubishi’s 30% investment in Copper World

Key Terms

streaming arrangements, deferred consideration receivable, non-controlling interest, provisionally priced receivables, +2 more

6 terms

streaming arrangements financial

"Accretion on streaming arrangements (note 18) was $9.0 million year-to-date"

deferred consideration receivable financial

"The deferred consideration receivable of $169.8 million will be accreted up to $180 million"

non-controlling interest financial

"Mitsubishi completed its strategic investment for a 30% minority non-controlling interest in Copper World"

Non-controlling interest represents the portion of ownership in a company held by investors who do not have a controlling stake, meaning they do not have enough voting power to make major decisions. It is similar to owning a minority share of a business partner’s company—while they benefit from profits, they cannot control how the company is run. This matters to investors because it shows how much of the company's value is owned by outside shareholders and affects overall financial reporting.

provisionally priced receivables financial

"Hudbay records changes in fair value of provisionally priced receivables related to provisional pricing"

costless collars financial

"Hudbay had 13.2 million pounds of copper costless collars outstanding settling from July 2026"

A costless collar is a hedging strategy where an investor buys a protective option that limits losses and simultaneously sells an option that caps gains so the two premiums roughly cancel out. Think of it like buying insurance on a car while agreeing to share any big windfall from its sale with the insurer — it protects your downside without an upfront payment, but it also limits how much you can profit. Investors use it to reduce risk on a position while preserving capital and avoiding immediate cash outlay.

decommissioning, restoration and similar liabilities financial

"Decommissioning, restoration and similar liabilities are remeasured at each reporting date"

AI-generated analysis. How Rhea-AI works. Not financial advice.

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Available on EDGAR 07/29/2026 - 04:56 PM Accepted by SEC EDGAR 07/29/2026 - 04:55 PM

FAQ

How did Hudbay Minerals (HBM) perform financially in Q2 2026?

Hudbay earned $138.1 million in net income on $631.3 million of revenue in Q2 2026. This compared with $114.7 million of net income and $536.4 million of revenue in Q2 2025, with EPS rising to $0.34 from $0.30.

What were Hudbay Minerals’ (HBM) results for the first half of 2026?

For the six months ended June 30, 2026, Hudbay reported $1,388.6 million in revenue and $329.6 million in net income. This compares with $1,131.3 million of revenue and $213.9 million of net income for the same period in 2025, with EPS increasing to $0.82.

What is the Arizona Sonoran (ASCU) acquisition and how does it affect Hudbay (HBM)?

On June 24, 2026 Hudbay acquired all remaining ASCU shares in an asset acquisition, issuing 46,794,082 Hudbay shares. The deal recognized an $1,357.0 million exploration property at the Cactus project and added deferred land payment obligations totaling $102.8 million.

What are the key terms of Hudbay Minerals’ (HBM) Copper World joint venture with Mitsubishi?

In January 2026 Mitsubishi acquired a 30% interest in Copper World, contributing about $422.7 million in cash at closing and $169.8 million of deferred consideration. Hudbay retains 70% and the cash is designated exclusively for Copper World’s development.

How has Hudbay Minerals (HBM) managed its debt in 2026?

Hudbay repaid $472.5 million of 4.50% senior notes due 2026 on April 1, 2026, funded with cash and a $272.0 million revolving credit draw. It also issued $52.0 million of 4.50% municipal bonds, ending the period with long‑term debt of $860.2 million.

What is Hudbay Minerals’ (HBM) cash position and liquidity as of June 30, 2026?

Hudbay held $890.9 million in cash and cash equivalents at June 30, 2026, including $334.5 million restricted to Copper World. Operating activities generated $508.3 million in cash in the first half, and the company had access to senior secured revolving credit facilities.

How did streaming and hedging arrangements impact Hudbay Minerals (HBM) in 2026?

Gold and silver stream amortization totaled $29.1 million in the first half, with a small $0.1 million variable consideration reduction. Changes in fair value of financial instruments produced a $111.6 million net gain, mainly from investments at fair value through profit or loss.

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 6-K

REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13A-16 OR 15D-16 OF
THE SECURITIES EXCHANGE ACT OF 1934

For the month of July 2026

Commission File Number: 001-34244

HUDBAY MINERALS INC.
(Translation of registrant’s name into English)

25 York Street, Suite 800
Toronto, Ontario
M5J 2V5, Canada
(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form 40-F.

Form 20-F [ ] Form 40-F [X]

Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934.

Yes [ ] No [X]

If “Yes” is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b): 82- _____________________________

EXPLANATORY NOTE

On July 29, 2026, Hudbay Minerals Inc. (“Hudbay”) filed on the Canadian Securities Administrators’ System for Electronic Document Analysis and Retrieval (SEDAR) website at www.sedarplus.ca the following documents: (1) Unaudited Condensed Consolidated Interim Financial Statements for the period ended June 30, 2026, (2) Management's Discussion and Analysis for the period ended June 30, 2026, (3) News Release dated July 29, 2026, (4) Form 52-109F2 - Certification of Interim Filings - CEO, (5) Form 52-109F2 - Certification of Interim Filings - CFO.

Copies of the filings are attached to this Form 6-K and incorporated herein by reference, as follows:

Exhibit 99.1 — Unaudited Condensed Consolidated Interim Financial Statements for the period ended June 30, 2026
Exhibit 99.2 — Management's Discussion and Analysis for the period ended June 30, 2026
Exhibit 99.3 — News Release dated July 29, 2026
Exhibit 99.4 — Form 52-109F2 - Certification of Interim Filings - CEO
Exhibit 99.5 — Form 52-109F2 - Certification of Interim Filings - CFO

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	HUDBAY MINERALS INC.
	(registrant)

	By:	/s/ Eugene Lei
	Name:	Eugene Lei
	Title:	President and Chief Financial Officer

Date: July 29, 2026

EXHIBIT INDEX

The following exhibits are furnished as part of this Form 6-K:

Exhibit		Description

99.1		Unaudited Condensed Consolidated Interim Financial Statements for the period ended June 30, 2026
99.2		Management's Discussion and Analysis for the period ended June 30, 2026
99.3		News Release dated July 29, 2026
99.4		Form 52-109F2 - Certification of Interim Filings - CEO
99.5		Form 52-109F2 - Certification of Interim Filings - CFO

Unaudited Condensed Consolidated Interim Financial Statements

(In US dollars)

HUDBAY MINERALS INC.

For the three and six months ended June 30, 2026 and 2025

HUDBAY MINERALS INC.
Condensed Consolidated Interim Balance Sheets
(Unaudited and in millions of US dollars)

			Jun. 30,		Dec. 31,
	Note		2026		2025
Assets
Current assets
Cash and cash equivalents	8	$	890.9	$	568.9
Trade and other receivables	9		204.0		377.8
Inventories	10		189.8		199.2
Prepaid expenses and other current assets			14.7		15.2
Other financial assets	11		53.3		0.8
Taxes receivable			3.6		1.2
			1,356.3		1,163.1
Receivables	9		188.8		16.1
Inventories	10		35.0		21.6
Other financial assets	11		153.9		130.9
Intangibles and other assets	12		40.2		58.6
Property, plant and equipment	13		6,196.5		4,693.9
Deferred tax assets			21.2		66.5
Goodwill			70.1		72.6
		$	8,062.0	$	6,223.3
Liabilities
Current liabilities
Trade and other payables		$	318.3	$	342.8
Taxes payable			63.9		117.4
Other liabilities	14		67.1		94.7
Other financial liabilities	15		95.0		122.9
Lease liabilities	16		27.0		26.7
Current portion of long-term debt	17		-		472.1
Deferred revenue	18		33.2		52.1
			604.5		1,228.7
Other financial liabilities	15		274.2		155.0
Lease liabilities	16		26.0		29.3
Long-term debt	17		860.2		536.5
Deferred revenue	18		263.9		265.0
Pension obligations			3.7		7.5
Other employee benefits			82.4		82.4
Environmental and other provisions	19		327.5		312.6
Deferred tax liabilities			359.0		375.3
			2,801.4		2,992.3
Equity
Share capital	21b		3,808.4		2,668.2
Reserves			206.2		102.3
Retained earnings			782.6		460.5
Equity attributable to owners of the Company			4,797.2		3,231.0
Non-controlling interest	5		463.4		-
		$	8,062.0	$	6,223.3
Commitments (note 24)

HUDBAY MINERALS INC.
Condensed Consolidated Interim Statements of Income
(Unaudited and in millions of US dollars, except per share amounts)

			Three months ended June 30,						Six months ended June 30,
			2026			2025			2026			2025
Revenue	7a	$	631.3		$	536.4		$	1,388.6		$	1,131.3
Cost of sales
Mine operating costs			273.5			263.5			562.9			519.0
Depreciation and amortization	7b		88.8			96.4			188.7			204.5
			362.3			359.9			751.6			723.5
Gross profit			269.0			176.5			637.0			407.8
Selling and administrative expenses			19.9			20.7			54.3			34.4
Exploration expenses			19.2			9.4			35.4			23.3
Other operating expenses	7c		4.7			7.1			14.8			12.3
Re-evaluation adjustment - environmental provision	19		5.5			(13.8	)		7.6			(1.0	)
Results from operating activities			219.7			153.1			524.9			338.8
Interest expense on long term debt	7d		13.3			15.6			27.7			31.5
Accretion on streaming arrangements	7d		4.5			5.2			9.0			9.6
Change in fair value of financial instruments	7d		(48.7	)		(4.1	)		(111.6	)		(9.3	)
Other net finance expense (income)	7d		10.2			(16.7	)		20.4			(17.4	)
Other (income) expenses			(20.7	)		-			(54.5	)		14.4
Income before tax			240.4			153.1			579.4			324.4
Tax expense	20		102.3			38.4			249.8			110.5
Net income for the period		$	138.1		$	114.7		$	329.6		$	213.9

Attributable to:
Owners of the Company		$	137.4		$	117.7		$	327.8		$	218.1
Non-controlling interest			0.7			(3.0	)		1.8			(4.2	)
Net income for the period		$	138.1		$	114.7		$	329.6		$	213.9

Earnings per share attributable to owners
Basic and diluted		$	0.34		$	0.30		$	0.82		$	0.55

Weighted average number of common shares outstanding:
Basic	22		400,356,079			395,085,907			397,729,494			395,018,364
Diluted	22		402,015,613			395,827,311			399,454,269			395,759,554

HUDBAY MINERALS INC.
Condensed Consolidated Interim Statements of Comprehensive Income
(Unaudited and in millions of US dollars)

		Three months ended June 30,					Six months ended June 30,
		2026			2025		2026			2025
Net income for the period	$	138.1		$	114.7	$	329.6		$	213.9

Other comprehensive income:
Item that will be reclassified subsequently to profit or loss:
Recognized directly in equity:
Net (loss) gain on translation of foreign currency balances		(8.9	)		26.4		(18.5	)		26.8

Items that will not be reclassified subsequently to profit or loss:
Recognized directly in equity:
Remeasurement - actuarial gain		1.8			1.2		3.7			2.5
Tax effect		(1.0	)		0.1		(1.0	)		(0.1	)
		0.8			1.3		2.7			2.4

Other comprehensive (loss) gain net of tax, for the period		(8.1	)		27.7		(15.8	)		29.2
Total comprehensive income for the period	$	130.0		$	142.4	$	313.8		$	243.1

Attributable to:
Owners of the Company	$	129.3		$	142.3		312.0			244.1
Non-controlling interest		0.7			0.1		1.8			(1.0	)
Total comprehensive income for the period	$	130.0			142.4	$	313.8		$	243.1

HUDBAY MINERALS INC.
Condensed Consolidated Interim Statements of Cash Flows
(Unaudited and in millions of US dollars)

		Three months ended June 30,							Six months ended June 30,
	Note		2026			2025			2026			2025
Cash generated from operating activities:
Net income for the period		$	138.1		$	114.7		$	329.6		$	213.9
Items not affecting cash:
Tax expense	20		102.3			38.4			249.8			110.5
Depreciation and amortization	7b		89.3			96.8			190.1			205.3
Share-based compensation	7e		10.5			10.8			34.7			14.8
Other (income) expenses	7d		(20.7	)		-			(54.5	)		14.4
Inventory adjustments	10		0.9			3.5			0.9			4.7
Amortization of deferred revenue and variable consideration	7a		(9.5	)		(15.4	)		(29.0	)		(44.7	)
Pension and other employee benefit payments, net of accruals			1.0			0.9			3.7			4.1
Amortization of community agreements			4.8			3.1			10.0			5.0
Re-evaluation adjustment - environmental obligation	19		5.5			(13.8	)		7.6			(1.0	)
Write-down/loss on disposal of PP&E	7c		0.5			0.3			1.5			0.9
Decommissioning and restoration payments			(3.5	)		(0.4	)		(6.7	)		(0.5	)
Other	25a		(0.2	)		(1.1	)		(56.1	)		(8.6	)
Taxes paid			(108.9	)		(43.9	)		(262.8	)		(161.4	)
Operating cash flow before change in non-cash working capital			210.1			193.9			418.8			357.4
Change in non-cash working capital	25b		86.9			66.0			89.5			27.3
			297.0			259.9			508.3			384.7
Cash used in investing activities:
Acquisition of property, plant and equipment			(152.9	)		(121.7	)		(293.1	)		(213.1	)
Acquisition of intangibles			(0.5	)		(0.8	)		(0.9	)		(2.4	)
Community agreements			(13.0	)		(5.2	)		(16.7	)		(9.0	)
Grants received			0.3			-			0.3			-
Cash and cash equivalents acquired in acquisitions, net of transaction and closing costs paid	4		11.9			-			11.9			-
Net purchase of investments	11		(7.2	)		-			(38.7	)		(13.8	)
Proceeds from disposition of property, plant and equipment			-			-			-			0.1
Change in restricted cash			-			0.6			-			0.8
Maturity of short-term investments			-			20.0			-			40.0
Investment income received			6.9			6.5			16.1			12.5
			(154.5	)		(100.6	)		(321.1	)		(184.9	)
Cash (used in) generated from financing activities:
Proceeds from drawdown on revolving credit facility	17b		272.0			-			272.0			-
Repurchase of senior unsecured notes, net of discount	17a		(472.5	)		(50.0	)		(472.5	)		(50.0	)
Release of restricted cash related to municipal bond financing	11		1.0			-			1.0			-
Repayment of deferred Copper Mountain acquisition consideration			(3.0	)		-			(3.0	)		-
Copper Mountain non-controlling interest - acquisition payment	6		-			(6.0	)		-			(6.0	)
Equity issuance, net of transaction and share issuance costs	21b		-			4.2			-			4.2
Interest paid on long-term debt			(30.0	)		(29.9	)		(30.0	)		(29.9	)
Financing costs			(3.1	)		(2.9	)		(5.9	)		(6.1	)
Lease payments	16		(9.0	)		(9.3	)		(18.4	)		(18.4	)
Equipment financing payments			(7.4	)		(4.6	)		(14.1	)		(8.9	)
Net payments on settlement of non-QP hedges			-			(1.6	)		-			(3.4	)
Net proceeds from exercise of stock options and warrants			1.0			1.2			3.0			1.6
Proceeds from sale of Copper World non-controlling interest, net of transaction costs	5		-			-			411.7			-
Dividends paid	21b		(2.8	)		-			(5.7	)		(2.8	)
			(253.8	)		(98.9	)		138.1			(119.7	)
Effect of movement in exchange rates on cash			(1.6	)		2.5			(3.3	)		3.6
Net (decrease) increase in cash and cash equivalents			(112.9	)		62.9			322.0			83.7
Cash and cash equivalents, beginning of the period			1,003.8			562.6			568.9			541.8
Cash and cash equivalents, end of the period		$	890.9		$	625.5		$	890.9		$	625.5

HUDBAY MINERALS INC.
Condensed Consolidated Interim Statements of Changes in Equity
(Unaudited and in millions of US dollars)

		Share capital (note 21)		Other capital reserves			Foreign currency translation reserve			Remeasurement reserve		Retained earnings			Total			Non- controlling interest			Total equity
Balance, January 1, 2025	$	2,641.3	$	61.5		$	(48.4	)	$	1.2	$	(102.4	)	$	2,553.2		$	94.2		$	2,647.4
Net income (loss)		-		-			-			-		218.1			218.1			(4.2	)		213.9
Other comprehensive income		-		-			23.6			2.4		-			26.0			3.2			29.2
Total comprehensive income (loss)		-		-			23.6			2.4		218.1			244.1			(1.0	)		243.1
Contributions by and distributions to owners:
Dividends (note 21b)		-		-			-			-		(2.8	)		(2.8	)		-			(2.8	)
Share issued on equity raise, net of share issuance costs		4.2		-			-			-		-			4.2			-			4.2
Copper Mountain non-controlling interest acquisition (note 6)		-		61.3			(4.0	)		-		-			57.3			(93.2	)		(35.9	)
Stock options		-		1.3			-			-		-			1.3			-			1.3
Issuance of shares related to stock options and warrants exercised		2.4		(0.8	)		-			-		-			1.6			-			1.6
Tax adjustments in respect of prior years		4.4		-			-			-		-			4.4			-			4.4
Total contributions by and distributions to owners		11.0		61.8			(4.0	)		-		(2.8	)		66.0			(93.2	)		(27.2	)
Balance, June 30, 2025		2,652.3		123.3			(28.8	)		3.6		112.9			2,863.3			-			2,863.3
Net income		-		-			-					350.4			350.4			-			350.4
Other comprehensive (loss) income		-		-			(1.1	)		4.8		-			3.7			-			3.7
Total comprehensive (loss) income		-		-			(1.1	)		4.8		350.4			354.1			-			354.1
Contributions by and distributions to owners:
Dividends (note 21b)		-		-			-			-		(2.8	)		(2.8	)		-			(2.8	)
Flow-through shares issued, net of share issuance costs (note 21b)		13.7		-			-			-		-			13.7			-			13.7
Stock options		-		1.2			-			-		-			1.2			-			1.2
Issuance of shares related to stock options and warrants exercised		2.2		(0.7	)		-			-		-			1.5			-			1.5
Total contributions by and distributions to owners		15.9		0.5			-			-		(2.8	)		13.6			-			13.6
Balance, December 31, 2025	$	2,668.2	$	123.8		$	(29.9	)	$	8.4	$	460.5		$	3,231.0			-		$	3,231.0

HUDBAY MINERALS INC.
Condensed Consolidated Interim Statements of Changes in Equity
(Unaudited and in millions of US dollars)

		Share capital (note 21)		Other capital reserves			Foreign currency translation reserve			Remeasurement reserve		Retained earnings			Total			Non- controlling interest		Total equity
Balance, January 1, 2026	$	2,668.2	$	123.8		$	(29.9	)	$	8.4	$	460.5		$	3,231.0		$	-	$	3,231.0
Net income		-		-			-			-		327.8			327.8			1.8		329.6
Other comprehensive (loss) income		-		-			(18.5	)		2.7		-			(15.8	)		-		(15.8	)
Total comprehensive (loss) income		-		-			(18.5	)		2.7		327.8			312.0			1.8		313.8
Contributions by and distributions to owners:
Dividends (note 21b)		-		-			-			-		(5.7	)		(5.7	)		-		(5.7	)
Copper World non-controlling interest capital contribution, net of transaction costs (note 5)		-		119.9			-			-		-			119.9			461.6		581.5
Shares issued on acquisition of Arizona Sonoran (note 4)		1,135.6		-			-			-		-			1,135.6			-		1,135.6
Stock options		-		1.4			-			-		-			1.4			-		1.4
Issuance of shares related to stock options and warrants exercised		4.6		(1.6	)		-			-		-			3.0			-		3.0
Total contributions by and distributions to owners		1,140.2		119.7			-			-		(5.7	)		1,254.2			461.6		1,715.8
Balance, June 30, 2026	$	3,808.4	$	243.5		$	(48.4	)	$	11.1	$	782.6		$	4,797.2		$	463.4	$	5,260.6

HUDBAY MINERALS INC.
Notes to Unaudited Condensed Consolidated Interim Financial Statements
(in millions of US dollars, except where otherwise noted)
For the three and six months ended June 30, 2026 and 2025

1. Reporting entity

Hudbay Minerals Inc. ("HMI" or the "Company") is a company existing under the Canada Business Corporations Act. The address of the Company's principal executive office is 25 York Street, Suite 800, Toronto, Ontario. The unaudited condensed consolidated interim financial statements ("interim financial statements") of the Company for the three and six months ended June 30, 2026 and 2025 represent the financial position and the financial performance of the Company and its subsidiaries (together referred to as "Hudbay").

Wholly owned subsidiaries as at June 30, 2026 included, without limitation, Copper Mountain Mine (BC) Ltd. ("CMBC"), HudBay Peru Inc., HudBay Peru S.A.C. ("Hudbay Peru"), HudBay (BVI) Inc., and Hudbay Arizona ULC. Hudbay Arizona ULC indirectly owns (i) Mason Resources (US) Inc. ("Mason"), Arizona Sonoran Copper Company Inc. ("ASCU"), and (ii) 70% of Copper World LLC ("Copper World"), the entity that owns the Copper World project. Mitsubishi Corporation ("Mitsubishi"), an arms length party, owns the remaining 30% interest in Copper World.

Hudbay is a diversified mining company with long-life assets in North and South America. Hudbay's operations in Cusco (Peru) produce copper with gold, silver and molybdenum by-products. Hudbay's operations in Manitoba (Canada) produce gold with copper, zinc and silver by-products. Hudbay's operations in British Columbia (Canada) produce copper with gold and silver by-products. Hudbay has a development pipeline that includes copper development projects in Arizona and Nevada (United States), and a focused growth strategy on exploration, development, operation, and optimization of properties that Hudbay already controls, as well as other mineral assets that Hudbay may acquire that fit the Company's strategic criteria. The Company's common shares are listed under the symbol "HBM" on the Toronto Stock Exchange, New York Stock Exchange and Bolsa de Valores de Lima.

2. Basis of preparation

(a) Statement of compliance:

These interim financial statements have been prepared in accordance with IAS 34, Interim Financial Reporting as issued by the International Accounting Standards Board ("IASB") and do not include all of the information required for annual financial statements prepared in accordance with IFRS^® Accounting Standards as issued by the IASB.

These interim financial statements should be read in conjunction with the Company's audited consolidated financial statements for the year ended December 31, 2025 which includes information necessary or useful to understanding the Company's business and financial statement presentation. In particular, the Company's material accounting policies are presented in note 3 in the Company's audited consolidated financial statements for the year ended December 31, 2025 and have been consistently applied in the preparation of these interim financial statements, except as noted below.

Deferred consideration receivable from the sale of non-controlling interest

Deferred consideration receivables arising from the sale of non-controlling interest are initially recognized as a financial asset at their fair value on the date the obligation arises. The fair value is determined by discounting the expected cash inflows to its present value using a company credit adjusted discount rate that reflects current market assessments of the time value of money and the risks specific to the company. The deferred consideration will be classified as a financial asset at amortized cost, with subsequent remeasurements recognized in profit or loss. Additionally, the asset will then be accreted and amortized until the maturity date, with the accretion expense flowing through profit or loss (note 5).

The Board of Directors approved these interim financial statements on July 28, 2026.

(b) Use of judgements and estimates:

The preparation of the interim financial statements in conformity with IFRS Accounting Standards requires Hudbay to make judgements, estimates and assumptions, in applying accounting policies that affect reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the interim financial statements, as well as reported amounts of revenue and expenses during the reporting period. Actual results may differ from these judgements, estimates and assumptions. The interim financial statements reflect the judgements and estimates outlined by Hudbay in its audited consolidated financial statements for the year ended December 31, 2025, except as noted below.

- Valuation of assets in an asset acquisition (note 4) - As the Company acquired ASCU through the issuance of the Company's common shares and the Company concluded that the acquisition of ASCU is an asset acquisition, a valuation was required to the fair value of the net assets acquired. The fair values of the net assets acquired were calculated using significant estimates and judgements. In particular, the fair value of the exploration property has been determined using an independent valuation involving discounted cash flow calculations. Such calculations and models were required to estimate, amongst other items, future production, future commodity prices, operating and capital input costs, discount rates and currency rates.

3. New standards

New standards and interpretations adopted

(a) Amendments to IFRS 9 - Financial Instruments and IFRS 7 - Financial Instruments: Disclosures

In May 2024, the IASB issued amendments to IFRS 9 and 7 to clarify the recognition or derecognition of a financial asset or liability, with a new exception for some financial liabilities settled through an electronic cash transfer system. The amendments also add guidance for assessing whether a financial asset meets the solely payments of principal and interest (SPPI) criterion, by introducing an additional SPPI test for financial assets with contingent features that are not related directly to a change in basic lending risks or costs. In addition, the amendments will add new disclosures for certain instruments with contractual terms that can change cash flows. Lastly, the amendments will require additional disclosures for equity instruments designated at fair value through other comprehensive income. The amendments are effective for reporting periods beginning on or after January 1, 2026, with early application permitted. The amendments have been adopted by the Company and the amendments did not result in any material changes to the condensed consolidated financial statements.

In December 2024, the IASB issued amendments to IFRS 9 and 7 to clarify the application of the 'own-use' exemption and provide guidance on hedge accounting for companies that hedge their purchase or sales of electricity using renewable power purchase agreements. The amendments also introduce new disclosure requirements. The amendments are effective for reporting periods beginning on or after January 1, 2026. The amendments have been adopted by the Company and the amendments did not result in any material changes to the condensed consolidated financial statements.

New standards issued but not yet effective

(a) IFRS 18 - Presentation and Disclosure in Financial Statements

In April 2024, the IASB released IFRS 18 Presentation and Disclosure in Financial Statements. IFRS 18 will replace IAS 1 Presentation of Financial Statements. The standard amends the presentation of the statement of income by introducing a newly defined 'operating profit' subtotal and a requirement for income and expenses to be allocated between three new distinct categories based on a company's main business activities, which are Operating, Financing and Investing. In addition, organizations will need to disclose certain 'non-GAAP' measures known as management-defined performance measures. The standard will be effective from January 1, 2027 with early adoption permitted and requires retrospective application. The Company is assessing the impact of adoption of this amendment on its condensed consolidated financial statements.

4. Acquisition of Arizona Sonoran

On June 24, 2026, Hudbay acquired all the issued and outstanding common shares of ASCU not already owned by Hudbay by way of a court-approved plan of arrangement (the "ASCU Transaction"). Former ASCU shareholders (other than Hudbay) received 0.242 of a common share of Hudbay for each common share of ASCU held immediately prior to the effective time of the ASCU Transaction. In doing so, Hudbay obtained control of ASCU on June 24, 2026, and ASCU is now a wholly owned subsidiary of Hudbay.

Management determined that substantially all of the fair value of the gross assets acquired is concentrated in the Cactus project and therefore accounted for the ASCU Transaction as an asset acquisition.

The aggregate number of common shares issued by Hudbay as consideration was 46,794,082 Hudbay common shares (note 21b). In addition, as of the effective time of the ASCU Transaction, 20,844,771 ASCU common shares were held by Hudbay with a value of $123.1 million. For an asset acquisition settled with equity, entities are required to record the net assets acquired based on the fair value of the assets received in exchange for the equity issued, unless fair value cannot be estimated reliably. Hudbay incurred acquisition related costs of $8.3 million during 2026, mainly related to external legal and advisory fees and due diligence costs, which were capitalized and included as cost of acquiring the net assets. During the six months ended June 30, 2026, $1.8 million of these costs were paid in cash, while $6.5 million remained accrued at period end.

The fair value of net assets acquired was determined using a combination of income and cost methods. In particular, the fair values of Cactus project have been calculated using significant judgements and estimates. The following presents the fair value amount of identifiable assets acquired and liabilities assumed as at June 24, 2026:

Fair value of net assets acquired / (liabilities) assumed
Cash and cash equivalents	$	63.0
Receivables		0.4
Prepaid expenses and other		0.4
Exploration property		1,357.0
Accounts payable and accrued liabilities		(31.0	)
Other current liabilities		(20.0	)
Deferred land payments		(102.8	)
Total fair value of net identifiable assets acquired	$	1,267.0

During the period of June 24, 2026 to June 30, 2026, ASCU paid transaction and closing payments that amounted to $49.3 million. These transaction and closing payments were accrued for prior to the effective time of the ASCU Transaction.

5. Sale of non-controlling interest in Copper World

In January 2026, Hudbay closed its Copper World joint venture transaction with Mitsubishi, pursuant to which Mitsubishi completed its strategic investment for a 30% minority interest in Copper World, which owns the fully-permitted Copper World project in Arizona (the "JV Transaction"). On closing, Mitsubishi contributed approximately $420 million of cash to Copper World, and it will contribute an additional $180 million in cash to Copper World within 18 months of the closing date of the JV Transaction, in accordance with the terms of the definitive subscription agreement dated August 12, 2025. Following the completion of the JV Transaction, Hudbay retained a 70% controlling interest in Copper World and continues to consolidate Copper World. The JV Transaction was accounted for as an equity transaction resulting in the recognition of a non-controlling interest.

The Company recorded $581.5 million of total consideration for the JV Transaction which included the cash consideration of $422.7 million received on the closing date, $169.8 million of deferred consideration recorded as a long term receivable and $11.0 million of transaction costs recorded within equity. The carrying value of the non-controlling interest was increased by $461.6 million to reflect the change in the proportionate share of Copper World's net assets.

As a result of the JV Transaction, the Company recorded an increase to equity as follows:


Cash consideration received	$	422.7
Deferred consideration receivable		169.8
Less: Carrying value of the non-controlling interest transferred		(461.6	)
Less: Transaction costs recorded in equity		(11.0	)
Surplus - recorded in equity	$	119.9

The deferred consideration of $169.8 million will be accreted up to $180 million over the 18 month period. For the three and six months ended June 30, 2026, the Company recorded $1.7 million and $3.2 million, respectively, in accretion in long term receivable related to the deferred consideration within finance income (note 7d). The cash consideration received as part of the JV Transaction is designated for exclusive use by Copper World and is not available for general use by the Hudbay consolidated group.

6. Copper Mountain non-controlling interest acquisition

On April 30, 2025, Hudbay completed the acquisition of Mitsubishi Materials Corporation's ("MMC") 25% minority interest in CMBC (the "CMBC Transaction"). The cash consideration of the CMBC Transaction consisted of:

• $4.5 million on the closing date of the CMBC Transaction,

• $21.0 million in seven annual deferred payments of $3.0 million each, commencing on the 12-month anniversary of the closing date of the CMBC Transaction, and

• up to $18.75 million in five additional contingent payments of $3.75 million each, payable in the years following New Ingerbelle achieving certain minimum annual operating thresholds. MMC's right to the contingent payments concludes on the 15-year anniversary of the closing date of the CMBC Transaction.

As a result of the CMBC Transaction, Hudbay increased its ownership of the Copper Mountain mine from 75% to 100%. CMBC is now a wholly owned subsidiary of Hudbay.

The Company recorded $35.9 million of total consideration for the CMBC Transaction which included the cash payment of $4.5 million on the closing date, $16.6 million of deferred payments and $13.3 million of contingent consideration recorded as financial liability at amortized cost (note 15) and $1.5 million of transaction costs recorded within equity.

As a result of the CMBC Transaction, the Company recorded an increase to equity as follows:


Carrying value of non-controlling interest as at April 30, 2025	$	93.2
Transfer of net gain on translation of foreign currency balances		4.0
Less: total consideration		(35.9	)
Surplus - recorded in equity	$	61.3

7. Revenue and expenses

(a) Revenue

Hudbay's revenue by significant product types:

		Three months ended June 30,						Six months ended June 30,
		2026			2025			2026			2025
Copper	$	333.8		$	297.1		$	713.9		$	599.4
Gold		262.4			189.2			552.0			383.4
Zinc		9.6			7.1			21.5			21.4
Silver		34.1			13.9			66.5			28.2
Molybdenum		18.4			19.1			39.0			40.0
Other		0.1			-			5.0			(0.2	)
Revenue from contracts		658.4			526.4			1,397.9			1,072.2
Non-cash streaming arrangement items: ¹
Amortization of deferred revenue - gold		2.5			5.9			11.6			14.3
Amortization of deferred revenue - silver		7.0			9.5			17.5			20.5
Amortization of deferred revenue - variable consideration adjustments - prior periods		-			-			(0.1	)		9.9
		9.5			15.4			29.0			44.7
Pricing and volume adjustments ²		(36.7	)		(2.1	)		(35.3	)		31.7
		631.2			539.7			1,391.6			1,148.6
Treatment and refining charges		0.1			(3.3	)		(3.0	)		(17.3	)
	$	631.3		$	536.4		$	1,388.6		$	1,131.3

¹See note 18.

²Pricing and volume adjustments represent mark-to-market adjustments on initial estimate of provisionally priced sales, realized and unrealized changes to fair value of quotational pricing hedge derivative contracts and adjustments to originally invoiced weights and assays.

Consideration from the Company's stream agreements is considered variable (note 18). Gold and silver stream revenue can be subject to cumulative adjustments when the amount of precious metals to be delivered under the contract changes. As a result of changes in the Company's mineral reserve and resource estimate in the first quarter of 2026, the amortization rate by which deferred revenue is drawn down into income was adjusted and, as required, a variable consideration adjustment was made for all prior year stream revenues since the stream agreement inception date. This variable consideration adjustment for the six months ended June 30, 2026 resulted in a decrease in revenue of $0.1 million (six months ended June 30, 2025 - increase in revenue of $9.9 million).

(b) Depreciation and amortization

Depreciation of property, plant and equipment and amortization of intangible assets are reflected in the condensed consolidated interim statements of income as follows:

		Three months ended June 30,				Six months ended June 30,
		2026		2025		2026		2025
Cost of sales	$	88.8	$	96.4	$	188.7	$	204.5
Selling and administrative expenses		0.5		0.4		1.4		0.8
	$	89.3	$	96.8	$	190.1	$	205.3

(c) Other operating expenses

		Three months ended June 30,						Six months ended June 30,
		2026			2025			2026			2025
Regional costs	$	2.1		$	1.4		$	5.8		$	3.0
Write-down/loss on disposal of PP&E		0.5			0.3			1.5			0.9
Amortization of community costs (other assets)		3.5			1.7			7.4			2.3
Restructuring		-			-			-			0.1
Wildfire repair costs		-			2.1			-			2.1
Care & maintenance - Manitoba		3.7			2.9			6.9			6.3
Evaluation costs		9.2			0.3			12.1			1.5
Insurance recovery		(11.5	)		-			(11.5	)		-
Reduction of obligation to renounce flow-through share expenditures, net of provisions		(2.8	)		(1.2	)		(6.1	)		(3.1	)
Option agreement proceeds		(1.0	)		(1.0	)		(1.6	)		(2.5	)
Other		1.0			0.6			0.3			1.7
	$	4.7		$	7.1		$	14.8		$	12.3

The Flin Flon concentrator and tailings impoundment is on care and maintenance to provide optionality should another mineral discovery occur in the Flin Flon area. During the three and six months ended June 30, 2026, care & maintenance costs were $3.7 million and $6.9 million, respectively (three and six months ended June 30, 2025 - $2.9 million and $6.3 million, respectively).

During the second quarter of 2026, a recovery of $11.5 million was recorded to reflect the business interruption insurance proceeds related to the wildfire evacuation and temporary suspension of operations at Manitoba. As of June 30, 2026, all of the proceeds related to this gain have been received.

During the second quarter of 2025, the Manitoba business unit incurred costs related to emergency and evacuation activities of $2.1 million as a result of regional wildfires in Snow Lake, Flin Flon and surrounding areas.

(d) Other (income) expense

		Three months ended June 30,						Six months ended June 30,
		2026			2025			2026			2025
Interest expense on long-term debt
Interest expense on long-term debt	$	13.3		$	15.6		$	27.7		$	31.5
Accretion on streaming arrangements (note 18)
Additions		4.5			5.2			9.0			10.2
Variable consideration adjustments - prior periods		-			-			-			(0.6	)
		4.5			5.2			9.0			9.6
Change in fair value of financial instruments
Unrealized loss (gain) on non-quotational pricing hedges		8.0			(1.1	)		0.5			-
Realized loss on non-quotational pricing hedges		0.1			0.4			0.1			2.3
Investments at fair value through profit or loss (note 11)		(56.8	)		(3.4	)		(112.2	)		(11.6	)
		(48.7	)		(4.1	)		(111.6	)		(9.3	)
Other net finance expense (income)
Net foreign exchange loss (gain)		12.0			(18.9	)		22.7			(22.0	)
Accretion on community agreements measured at amortized cost		0.5			1.4			2.8			2.7
Accretion on environmental provisions		3.0			2.7			6.0			5.4
Accretion on Wheaton refund liability		0.2			0.1			0.4			0.3
Accretion on deferred and contingent liability (note 15)		0.4			0.3			0.9			0.3
Accretion on deferred consideration receivable (note 5)		(1.7	)		-			(3.2	)		-
Interest on equipment financing and leases		2.2			2.3			4.4			4.6
Interest income		(7.1	)		(5.5	)		(15.9	)		(11.0	)
Other finance expense		0.7			0.9			2.3			2.3
		10.2			(16.7	)		20.4			(17.4	)
Other (income) expense	$	(20.7	)	$	-		$	(54.5	)	$	14.4

Other finance expense relates primarily to standby fees on Hudbay's revolving credit facilities.

(e) Share-based compensation expense

		Three months ended June 30,				Six months ended June 30,
		2026		2025		2026		2025
Cost of sales	$	1.2	$	1.0	$	4.1	$	1.6
Selling and administrative expenses		9.0		9.5		29.6		12.8
Other expense		0.3		0.3		1.0		0.4
	$	10.5	$	10.8	$	34.7	$	14.8

Share-based compensation expense included within cost of sales, selling and administrative expenses, and other expenses relates to deferred share units, restricted share units, performance shares units and the Company's stock option plan. The increase in share-based compensation expense during the six months ended June 30, 2026 compared with the same period last year primarily relates to the change in the Company's share price, in addition to adjustments to the performance based multiplier on performance share units.

8. Cash and cash equivalents

Cash and cash equivalents balances represent demand deposits and deposits with an original maturity date of less than three months. Cash and cash equivalents balance includes $334.5 million of cash held at Copper World, which is designated for exclusive use by Copper World and is not available for general use by the Hudbay consolidated group.

9. Trade and other receivables

		Jun. 30, 2026		Dec. 31, 2025
Current
Trade receivables	$	163.1	$	343.8
Statutory receivables		28.7		30.2
Other receivables		12.2		3.8
		204.0		377.8
Non-current
Taxes receivable		15.8		16.1
Deferred consideration receivable (note 5)		173.0		-
		188.8		16.1
	$	392.8	$	393.9

Trade receivables decreased to $163.1 million as at June 30, 2026 from $343.8 million as at December 31, 2025. The decrease was primarily due to a delay in scheduled shipments in Peru impacted by the temporary port closures as a result of ocean swells.

10. Inventories

		Jun. 30, 2026		Dec. 31, 2025
Current
Stockpile	$	13.3	$	17.9
Finished goods		65.7		76.0
Materials and supplies		110.8		105.3
		189.8		199.2
Non-current
Stockpile		19.3		5.3
Low grade stockpile¹		5.5		5.7
Materials and supplies		10.2		10.6
		35.0		21.6
	$	224.8	$	220.8
¹Primarily all of the low grade stockpile inventory is expected to be processed at the end of the Copper Mountain mine life.

The cost of inventories recognized as an expense, including depreciation and included in cost of sales, amounted to $315.9 and $644.7 million, respectively, for the three and six months ended June 30, 2026 (three and six months ended June 30, 2025 - $313.9 million and $630.3 million, respectively).

During the three and six months ended June 30, 2026, Hudbay recognized an expense of $0.9 million in cost of sales related to the writedown of certain non-current inventory supplies (three and six months ended June 30, 2025 - $2.4 million and $3.3 million, respectively).

During the three and six months ended June 30, 2025, Hudbay recognized an expense of $1.1 million and $1.5 million, respectively, in cost of sales primarily related to adjustments of the carrying value of copper concentrate inventory to net realizable value.

11. Other financial assets

		Jun. 30, 2026		Dec. 31, 2025
Current
Derivative assets	$	3.2	$	0.6
Restricted cash		50.1		0.2
		53.3		0.8

Non-current
Investments at fair value through profit or loss		153.9		130.9
		153.9		130.9
	$	207.2	$	131.7

As at June 30, 2026, current financial assets include $49.8 million of restricted cash held in a project trust account managed by U.S. Bank Trust Company. These funds represent proceeds from the issuance of 4.50% Arizona Industrial Development Authority Solid Waste Disposal Revenue Bonds (Copper World project), Series 2026A (the "Municipal bonds") which are legally earmarked for qualifying solid waste disposal expenditures at the Copper World project (note 17c). The Municipal bonds were issued by the Arizona Industrial Development Authority and have an initial mandatory tender date of July 2, 2036. During the second quarter of 2026, $1.0 million was released from the Municipal bonds. The Company expects to draw upon these proceeds within the next twelve months, as a result, this balance has been classified as a current asset. These funds are not available for general operational or debt service use by other entities within the Hudbay consolidated group.

Investments at fair value through profit or loss primarily relate to common shares held in various mining companies. For the six months ended June 30, 2026, the Company recorded additions of $39.3 million, unrealized mark-to-market gains of $112.2 million (note 7d), disposals of $0.6 million, unrealized foreign exchange losses of $4.8 million and cancellation of ASCU shares as part of an asset acquisition of $123.1 million (note 4).

12. Intangibles and other assets

Intangibles and other assets of $40.2 million (December 31, 2025 - $58.6 million) includes $32.4 million of other assets (December 31, 2025 - $51.5 million) and $7.8 million of intangibles (December 31, 2025 - $7.1 million).

Other assets include $32.4 million (December 31, 2025 - $42.8 million) of the carrying value of certain future community costs that relate to original agreements with communities for the Constancia operation which allow Hudbay to extract minerals over the useful life of the Peru operation. The liability remaining for these costs is recorded in agreements with communities recorded at amortized cost (note 15). Amortization of the carrying amount is recorded in the condensed consolidated interim statements of income within other expenses (note 7c) or exploration expenses, depending on the nature of the agreement.

Other assets also include $nil million related to cash advances and equipment financing advances made on long lease equipment (December 31, 2025 - $8.7 million).

Intangibles mainly represent computer software costs.

13. Property, plant and equipment

Jun. 30, 2026		Cost		Accumulated depreciation and amortization			Carrying amount
Exploration and evaluation assets	$	1,465.7	$	-		$	1,465.7
Capital works in progress		1,429.1		-			1,429.1
Mining properties		2,935.5		(1,583.6	)		1,351.9
Plant and equipment		3,696.1		(1,822.4	)		1,873.7
Plant and equipment - ROU assets¹		275.9		(199.8	)		76.1
	$	9,802.3	$	(3,605.8	)	$	6,196.5

Dec. 31, 2025		Cost		Accumulated depreciation and amortization			Carrying amount
Exploration and evaluation assets	$	108.9	$	-		$	108.9
Capital works in progress		1,359.8		-			1,359.8
Mining properties		2,842.6		(1,523.0	)		1,319.6
Plant and equipment		3,567.2		(1,743.7	)		1,823.5
Plant and equipment - ROU assets¹		273.5		(191.4	)		82.1
	$	8,152.0	$	(3,458.1	)	$	4,693.9
¹ Includes $5.0 million of capital works in progress - ROU assets (cost) that relate to the Copper World segment (December 31, 2025 - $5.3 million related to the Copper World segment).

Exploration and evaluation assets increased to $1,465.7 as at June 30, 2026, from $108.9 million as at December 31, 2025. The increase was primarily related to closing of the ASCU Transaction (note 4).

14. Other liabilities

		Jun. 30, 2026		Dec. 31, 2025

Environmental and other provisions (note 19)	$	61.1	$	90.2
Pension obligations		2.0		0.9
Other employee benefits		4.0		3.6
	$	67.1	$	94.7

15. Other financial liabilities

		Jun. 30, 2026		Dec. 31, 2025
Current
Derivative liabilities	$	8.2	$	31.9
Deferred Copper Mountain acquisition consideration		3.0		3.0
Deferred land payments		5.0		-
Financing related to property, plant and equipment		31.6		26.2
Agreements with communities		47.2		61.8
		95.0		122.9

Non-current
Deferred Copper Mountain acquisition consideration		11.8		14.4
Contingent Copper Mountain acquisition consideration		14.3		13.9
Deferred land payments		97.8		-
Financing related to property, plant and equipment		99.7		66.0
Agreements with communities		42.3		44.1
Wheaton refund liability		8.3		7.9
Other financial liability		-		8.7
		274.2		155.0
	$	369.2	$	277.9

Financing related to property, plant and equipment represents agreements that Hudbay has entered into to purchase mining equipment and land. Hudbay owns the assets and finances the payment of these assets over the specified term. These agreements expire between 2026 and 2032 with interest rates between 2.25% and 7.55% per annum.

The following table summarizes changes in financing related to property, plant & equipment:

Balance, January 1, 2025	$	76.7
Additions		33.1
Payments		(20.2	)
Accretion and other movements		2.6
Balance, December 31, 2025	$	92.2
Additions		56.3
Payments		(14.1	)
Accretion and other movements		(3.1	)
Balance, June 30, 2026	$	131.3

Agreements with communities recorded at amortized cost relate to agreements with communities near the Constancia operation which allow Hudbay to extract minerals over the useful life of the Constancia operation, carry out exploration and evaluation activities in the area and provide Hudbay with community support to operate in the region. During the six months ended June 30, 2026, there was a change in estimate related to amendments of life of mine agreements with respect to Constancia resulting in net reductions of $2.3 million. Payments will be made over the respective terms of the agreements, which have varying expiration dates ranging from 2026 to 2040.

As part of the CMBC Transaction, the Company recorded $16.6 million of deferred payment consideration and $13.3 million of contingent consideration as a financial liability at amortized cost on the closing of the CMBC Transaction. The deferred consideration will be settled over a period from 2026 to 2032, while the contingent consideration is payable between 2029 and 2033. During the three and six months ended June 30, 2026, accretion related to these liabilities were $0.4 million and $0.9 million, respectively (three and six months ended June 30, 2025 - $0.3 million) (note 7d).

As part of the ASCU Transaction (note 4), the Company recorded $5.0 million of current and $98.8 million of long term deferred land payments. The deferred land payments are associated with the Consortium Land purchase completed by ASCU in August 2025 which includes surface rights and mineral rights to such lands. The deferred land payments bear interest at 6% per annum and are payable in installments of $5.0 million each year from 2026 to 2028 with the remaining $82.2 million payable on maturity on August 28, 2029, with the rights to pre-pay in whole or in part, at any time, without penalty. The deferred land payments are structured as secured vendor carryback loans, pursuant to which certain deeds of trust were provided to the consortium vendors on their respectively sold portions of the land sold pursuant to the sale and on certain other properties already held by Cactus 110 LLC, a wholly-owned indirect subsidiary of ASCU.

As part of the streaming agreement for the 777 mine, Hudbay must repay, with precious metals credits, the stream deposit by August 1, 2052, the expiry date of the agreement. If the stream deposit is not fully repaid with precious metals credits from 777 production by the expiry date, a payment for the remaining amount will be due at the expiry date of the agreement. As the 777 mine has concluded all mining activities following the depletion of reserves and finalized the sales of produced concentrate, Hudbay concluded that the remaining stream deposit will not be repaid by means of precious metals credits from 777 production. The repayment amount is recorded as a Wheaton refund liability, which is and will be discounted at the 9.0% rate inherent in the original 777 stream agreement and accreted over the remaining term of the agreement.

16. Lease liabilities

Balance, January 1, 2025	$	74.8
Additional capitalized leases		17.7
Lease payments		(36.9	)
Derecognized leases		(0.9	)
Accretion and other movements		1.3
Balance, December 31, 2025	$	56.0
Additional capitalized leases		15.0
Lease payments		(18.4	)
Derecognized leases		-
Accretion and other movements		0.4
Balance, June 30, 2026	$	53.0

Lease liabilities are reflected in the condensed consolidated interim balance sheets as follows:

		Jun. 30, 2026		Dec. 31, 2025
Current	$	27.0	$	26.7
Non-current		26.0		29.3
	$	53.0	$	56.0

Hudbay has entered into leases which expire between 2026 and 2037. The interest rates on leases which were capitalized have interest rates between 2.50% and 8.49%, per annum. The range of interest rates utilized for discounting the lease depends mostly on Hudbay acting as a lessee and duration of the lease. For certain leases, Hudbay has the option to purchase the equipment and vehicles leased at the end of the terms of the leases. Hudbay's obligations under these leases are secured by the lessor's title to the leased assets. The present value of applicable lease payments has been recognized as an ROU asset, which was included as a non-cash addition to property, plant and equipment, and a corresponding amount as a lease liability.

There are no restrictions placed on Hudbay by entering into these leases.

The following outlines expenses recognized within the Company's condensed consolidated interim statements of income, relating to leases for which a recognition exemption was applied.

		Three months ended June 30,				Six months ended June 30,
		2026		2025		2026		2025
Short-term leases	$	5.5	$	3.4	$	12.5	$	5.5
Low value leases		0.1		0.1		0.2		0.2
Variable leases		5.3		4.8		11.3		9.0
Total	$	10.9	$	8.3	$	24.0	$	14.7

Payments made for short-term, low value and variable leases would mostly be captured as expenses in the condensed consolidated interim statements of income, however, certain amounts may be capitalized to PP&E for the Arizona segment during its development phase and certain amounts may be reported in inventories given the timing of sales. Variable payment leases include equipment used for heavy civil works at Constancia.

17. Long-term debt

		Jun. 30, 2026		Dec. 31, 2025
Current:
Senior unsecured notes (a)	$	-	$	472.1

Non-current:
Senior unsecured notes (a)		539.4		538.8
Senior secured revolving credit facilities (b)		270.1		(2.3	)
Senior unsecured municipal bonds (c)		50.7		-
	$	860.2	$	536.5
Total Long-term debt	$	860.2	$	1,008.6

(a) Senior unsecured notes

Balance, January 1, 2025	$	1,111.1
Repurchases		(102.5	)
Write-down of unamortized transaction costs		0.2
Accretion of transaction costs and premiums		2.1
Balance, December 31, 2025	$	1,010.9
Accretion of transaction costs and premiums		1.0
Repayment		(472.5	)
Balance, June 30, 2026	$	539.4

As at June 30, 2026, $542.4 million aggregate principal amount of senior notes were outstanding, consisting solely of a series of 6.125% senior notes due April 2029 ("2029 notes").

On April 1, 2026, the Company repaid in full the outstanding aggregate principal amount of $472.5 million of its 4.50% senior notes due April 2026 ("2026 notes") at maturity, using a combination of available cash on hand and a $272.0 million draw on its revolving credit facilities (note 17b). As a result, the 2026 notes were no longer outstanding as at June 30, 2026.

During the year ended December 31, 2025, the Company repurchased and retired a total of $102.5 million of the 2026 notes at a discount, prior to maturity. For the year ended December 31, 2025, the discount of $0.4 million was recorded as Other expenses in the consolidated statements of income. Upon the repurchase and retirement of $102.5 million of senior unsecured notes, the unamortized transaction costs related to this principal amount for the year ended December 31, 2025 of $0.2 million were recorded as a finance expense in the consolidated statements of income.

The senior notes are guaranteed on a senior unsecured basis by substantially all of the Company's subsidiaries, other than HudBay (BVI) Inc. and certain excluded or unrestricted subsidiaries, and subsidiaries that hold the Copper World, Mason and Cactus projects as well as any newly formed or acquired subsidiaries that primarily hold or may develop non-producing mineral assets that are in the pre-construction phase of development.

(b) Senior secured revolving credit facilities

Balance, January 1, 2025¹	$	(3.6	)
Accretion of transaction costs		1.3
Transaction costs		-
Balance, December 31, 2025¹	$	(2.3	)
Proceeds from drawdown		272.0
Accretion of transaction costs		0.4
Balance, June 30, 2026¹	$	270.1
¹ Balance, representing deferred transaction costs, is in an asset position.

Hudbay has two senior secured revolving credit facilities with total commitments of $450.0 million and substantially similar terms and conditions for its Canadian and Peruvian businesses. Hudbay's revolving credit facilities are secured against substantially all of the Company's assets, other than those associated with Copper World, Mason and Cactus projects. The two senior secured revolving credit facilities mature in November 2028. The revolving credit facility includes an accordion feature to increase the facility by an additional $150 million at Hudbay's discretion.

During the three months ended June 30, 2026, Hudbay drew $272.0 million under its Canadian revolving credit facility, which remains outstanding as of June 30, 2026.

As at June 30, 2026, there were nil draws under the Peruvian revolving credit facilities, other than letters of credit to support reclamation and pension obligations as described below.

As at June 30, 2026, the Peru segment had nil in letters of credit issued under the Peru revolving credit facility to support its reclamation obligations and the Manitoba segment had $24.3 million in letters of credit issued under the Canadian revolving credit facility to support its reclamation and pension obligations. As at June 30, 2026, the Company was in compliance with its covenants under the revolving credit facilities.

Surety bonds

The Arizona segment had $23.2 million in surety bonds issued to support future reclamation and closure obligations. No cash collateral is required to be posted under these surety bonds.

The British Columbia segment had $46.2 million in surety bonds issued to support future reclamation and closure obligations. The British Columbia segment had $1.5 million in surety bonds issued to BC Hydro in relation to the BC Hydro transmission system at the Copper Mountain Mine, and to Fisheries and Oceans Canada for fish monitoring. No cash collateral is required to be posted under these surety bonds.

The Peru segment had nil million in surety bonds issued to support future reclamation and closure obligations.

Other letters of credit

The Peru segment had $145.3 million in letters of credit issued with various Peruvian financial institutions to support future reclamation and other operating matters. No cash collateral is required to be posted under these letters of credit.

The British Columbia segment had $0.3 million in letters of credit issued to the Ministry of Finance and Ministry of Transport and Transit related to other operating matters. No cash collateral is required to be posted under these letters of credit.

Hudbay has a C$130.0 million bilateral letter of credit facility ("LC Facility") with a major Canadian financial institution. As at June 30, 2026, the Manitoba segment had $55.7 million in letters of credit issued under the LC Facility to support its reclamation and pension obligations.

(c) Senior unsecured municipal bonds

Balance, December 31, 2025	$	-
Addition		52.0
Transaction costs		(1.3	)
Balance, June 30, 2026	$	50.7

On June 24, 2026, $52.0 million aggregate principal amount of Municipal bonds were issued by the Arizona Industrial Development Authority (note 11). The Municipal bonds carry a fixed interest rate of 4.50% per annum, payable semi-annually.

At inception, the carrying value of the Municipal bonds is $50.7 million, net of $1.3 million in transaction cost. This transaction cost is capitalized against the liability and amortized over the initial term interest rate period using the effective interest method.

The Municipal bonds are senior unsecured obligations of Copper World LLC and are guaranteed on a senior unsecured basis by the Company and its primary operating subsidiaries.

18. Deferred revenue

Peru Stream Agreement

For the three and six months ended June 30, 2026, the drawdown rates for the Peru stream agreement for gold and silver were $833 and $15.56 per ounce, respectively (year ended December 31, 2025 - $860 and $15.06 per ounce, respectively).

The following table summarizes changes in deferred revenue:

Balance, January 1, 2025	$	372.2
Amortization of deferred revenue:
Liability drawdown		(65.1	)
Variable consideration adjustments - prior periods		(9.9	)
Accretion on streaming arrangements:
Current year additions		20.5
Variable consideration adjustments - prior periods		(0.6	)
Balance, December 31, 2025	$	317.1
Amortization of deferred revenue (note 7a):
Liability drawdown		(29.1	)
Variable consideration adjustments - prior periods		0.1
Accretion on streaming arrangements (note 7d):
Current year-to-date additions		9.0
Variable consideration adjustments - prior periods		-
Balance, June 30, 2026	$	297.1

Consideration from the Company's stream agreement is considered variable. Gold and silver stream revenue can be subject to cumulative adjustments when the number of ounces to be delivered under the contract changes. As a result of changes in the Company's mineral reserve and resource estimate in the first quarter of 2026, the amortization rate by which deferred revenue is drawn down into income was adjusted and, as required, a current period variable adjustment was made for all prior period stream revenues since the stream agreement inception date. This variable consideration adjustment resulted in an decrease in revenue of $0.1 million and $nil impact to finance expense for the six months ended June 30, 2026 (year ended December 31, 2025 - an increase in revenue of $9.9 million and a decrease in finance expense of $0.6 million).

Deferred revenue is reflected in the condensed consolidated interim balance sheets as follows:

		Jun. 30, 2026		Dec. 31, 2025
Current	$	33.2	$	52.1
Non-current		263.9		265.0
	$	297.1	$	317.1

19. Environmental and other provisions

Reflected in the condensed consolidated interim balance sheets as follows:

Jun. 30, 2026		Decommissioning, restoration and similar liabilities		Deferred share units		Restricted share units		Performance share units		Other ¹		Total
Current (note 14)	$	17.0	$	25.9	$	7.6	$	9.0	$	1.6	$	61.1
Non-current		319.7		-		2.5		4.1		1.2		327.5
	$	336.7	$	25.9	$	10.1	$	13.1	$	2.8	$	388.6

Dec. 31, 2025		Decommissioning, restoration and similar liabilities		Deferred share units		Restricted share units		Performance share units		Other ¹		Total
Current (note 14)	$	20.6	$	21.5	$	20.5	$	19.0	$	8.6	$	90.2
Non-current		297.8		-		5.6		7.9		1.3		312.6
	$	318.4	$	21.5	$	26.1	$	26.9	$	9.9	$	402.8
¹ Relates primarily to flow-through share premiums, restructuring costs and other non-capital provisions.

Decommissioning and restoration obligations ("DRO") are remeasured at each reporting date to reflect changes in discount rates, exchange rates, and timing and extent of cash outflows which can significantly affect the liabilities. This provision has been recorded based on estimates and assumptions that management believes are reasonable; however, actual decommissioning and restoration costs may differ from expectations.

During the six months ended June 30, 2026, the Company recorded a non-cash loss of $7.6 million in the condensed consolidated interim statements of income mainly related to a revaluation adjustment to the Flin Flon environmental reclamation provision. The re-evaluation adjustment was impacted by the timing and extent of cash flows for Flin Flon's closed sites. The adjustment also reflects net changes in long term, risk-free real discount rates based on changes in Canadian bond yields as well as increases in inflation rates. Typically, an operating location will reflect any revaluation adjustments to the environmental reclamation provision against its reclamation assets. However, as the Flin Flon operations closed in June 2022, the corresponding Flin Flon assets have been fully depreciated and cannot be reduced below residual value resulting in the remaining impact being recorded as a loss in the condensed consolidated interim statements of income.

As at June 30, 2026, decommissioning, restoration and similar liabilities have been discounted to their present value at rates ranging from 2.37% to 5.03% per annum (December 31, 2025 - 2.41% to 4.95%), using pre-tax, nominal risk-free interest rates that reflect the estimated maturity of each specific liability.

During the six months ended June 30, 2025, the Company recorded a non-cash gain of $1.0 million in the condensed consolidated interim statements of income mainly related to a revaluation adjustment to the Flin Flon environmental reclamation provision.

20. Income and mining taxes

The tax expense is applicable as follows:

		Three months ended June 30,					Six months ended June 30,
		2026		2025			2026			2025
Current
Income tax expense		41.7	$	30.3		$	125.7		$	64.8
Mining tax expense		32.7		17.6			79.4			38.9
Adjustments in respect of prior years		-		-			(0.7	)		(1.9	)
		74.4		47.9			204.4			101.8
Deferred
Income tax expense (recovery) - origination, revaluation and/or reversal of temporary differences		26.5		(10.5	)		42.2			10.9
Mining tax (recovery) expense - origination, revaluation and/or reversal of temporary difference		1.4		1.0			0.7			(1.4	)
Adjustments in respect of prior years		-		-			2.5			(0.8	)
		27.9		(9.5	)		45.4			8.7
	$	102.3	$	38.4		$	249.8		$	110.5

Adjustments in respect of prior years refers to amounts changing due to the filing of tax returns and assessments from government authorities as well as any change identified that would result in a difference to our current or deferred tax balances as reported in the prior fiscal year end.

21. Share capital

(a) Preference shares:

Authorized: Unlimited preference shares without par value.

Issued and fully paid: Nil.

(b) Common shares:

Authorized: Unlimited common shares without par value.

Issued and fully paid:

	Six months ended Jun. 30, 2026			Year ended Dec. 31, 2025
	Common shares		Amount	Common shares		Amount
Balance, beginning of year	396,834,231	$	2,668.2	394,932,374	$	2,641.3
Shares issued on acquisition of Arizona Sonoran (note 4)	46,794,082		1,135.6	-		-
Equity issuance, net of issuance costs	-		-	465,394		4.2
Flow through shares, net of share issuance costs and implied premium	-		-	887,000		13.7
Exercise of options	516,447		4.6	478,755		4.1
Exercise of warrants	-		-	70,708		0.5
Tax adjustments in respect of prior years	-		-	-		4.4
Balance, end of the period	444,144,760	$	3,808.4	396,834,231	$	2,668.2

Shares issued on acquisition of Arizona Sonoran

On June 24, 2026, the Company completed the acquisition of all the issued and outstanding common shares of ASCU. As consideration for the acquisition, the Company issued a total of 46,794,082 common shares for gross value of $1,135.6 million, based on the fair value of the net assets received from the ASCU Transaction (note 4).

Equity issuance

On June 24, 2025, the Company closed a private placement deal to issue 465,394 common shares at a price of C$13.30 per Common Share for aggregate gross proceeds of $4.5 million. Associated with the private placement were $0.3 million of share issuance costs resulting in net equity raised of $4.2 million. The net proceeds of this private placement were used to fund the $4.5 million cash consideration on closing of the acquisition of MMC's 25% interest in CMBC.

Flow-through share financing

During the year ended December 31, 2025, the Company completed a Canadian Exploration Expense ("CEE") flow-through financing. The Company issued 887,000 common shares for proceeds, net of transaction costs, of $22.6 million. The implied premium on the flow-through shares of $8.9 million was recorded as a flow-through share liability. The flow-through share liability will be recognized in earnings as eligible expenditures are made. During the six months ended June 30, 2026, $6.1 million of flow-through share liability was renounced and recognized in other expenses (note 7c) on the condensed consolidated statements of income.

Dividends

During the six months ended June 30, 2026, the Company declared two quarterly dividends of C$0.01 per share. The Company paid $2.9 million and $2.8 million in dividends on March 27, 2026 and June 26, 2026, respectively, to shareholders of record as of March 10, 2026 and June 9, 2026.

During the year ended December 31, 2025, the Company declared two semi-annual dividends of C$0.01 per share. The Company paid $2.8 million and $2.8 million in dividends on March 21, 2025 and September 19, 2025, respectively, to shareholders of record as of March 4, 2025 and September 2, 2025.

(c) Equity-settled share-based compensation

Stock Options

The Company's stock option plan was approved in June 2005 and amended in May 2008 (the "Plan"). Under the amended Plan, the Company may grant to employees, officers, directors or consultants of the Company or its affiliates options to purchase up to a maximum of 13 million common shares of Hudbay. The Company has determined that the appropriate accounting treatment is to classify the stock options as equity settled transactions.

The following table outlines the changes in the number of stock options outstanding:

	Jun. 30, 2026				Dec. 31, 2025
	Number of shares subject to option			Weighted- average exercise price C$	Number of shares subject to option			Weighted average exercise price C$
Balance, beginning of year	2,710,414		$	8.34	2,484,107		$	7.42
Number of units granted	270,247		$	34.15	828,720		$	10.81
Exercised	(516,447	)	$	7.97	(478,755	)	$	7.69
Forfeited	(40,992	)	$	13.25	(123,658	)	$	9.01
Balance, end of period	2,423,222		$	11.22	2,710,414		$	8.34

The following table outlines stock options outstanding and exercisable:

Jun. 30, 2026

Range of exercise
prices C$

Number of
options
outstanding

Weighted average
remaining
contractual life
(years)

Weighted
average
exercise price
C$

Number of
options
exercisable

Weighted average
share price at
exercise date C$

$3.76 - $5.26

236,123

0.66

3.76

236,123

3.76

$5.27 - $7.13

357,180

3.67

6.75

357,180

6.75

$7.14 - $8.71

535,329

4.65

7.50

287,158

7.50

$8.72 - $10.60

391,116

2.21

10.15

391,116

10.15

$10.61 - $13.50

639,845

5.64

10.81

151,542

10.79

$13.51 - $34.10

260,045

6.68

34.10

$34.11 - $38.07

3,584

6.68

38.07

Dec. 31, 2025
Range of exercise prices C$	Number of options outstanding	Weighted average remaining contractual life (years)		Weighted average exercise price C$	Number of options exercisable		Weighted average share price at exercise date C$
$3.76 - $5.26	292,198	1.15	$	3.76	290,732	$	3.76
$5.27 - $7.13	503,099	4.16	$	6.75	273,014	$	6.75
$7.14 - $8.71	687,508	5.15	$	7.50	164,283	$	7.50
$8.72 - $10.60	459,772	2.73	$	10.13	458,500	$	10.13
$10.61 - $13.50	767,837	6.12	$	10.81	-	$	-

Hudbay estimates expected life of options and expected volatility based on historical data, which may differ from actual outcomes.

22. Earnings per share

	Three months ended June 30,		Six months ended June 30,
	2026	2025	2026	2025
Weighted average common shares outstanding
Basic	400,356,079	395,085,907	397,729,494	395,018,364
Plus net incremental shares from:
Assumed conversion: stock options	1,659,534	719,932	1,724,775	719,637
Assumed conversion: warrants	-	21,472	-	21,553
Diluted weighted average common shares outstanding	402,015,613	395,827,311	399,454,269	395,759,554

The calculation of dilutive weighted-average number of common shares excludes the impact of 117,562 and 6 shares for the three and six months ended June 30, 2026, respectively (three and six months ended June 30, 2025 - 274,405 and 197,982, respectively). The shares related to stock options and warrants were excluded as the exercise price related to the particular security exceeded the average market price of the Company's common shares for the period, or the inclusion of the share units had an anti-dilutive effect on net income.

23. Financial instruments

(a) Fair value and carrying value of financial instruments:

The following presents the fair value ("FV") and carrying value ("CV") of Hudbay's financial instruments and non-financial derivatives:

		Jun. 30, 2026				Dec. 31, 2025
		FV		CV		FV			CV
Financial assets at amortized cost
Cash and cash equivalents¹	$	890.9	$	890.9	$	568.9		$	568.9
Restricted cash¹		50.1		50.1		0.2			0.2
Deferred consideration receivable²		172.2		173.0		-			-
Fair value through profit or loss
Trade and other receivables^3,4		175.3		175.3		347.6			347.6
Non-hedge derivative assets ⁵		3.2		3.2		0.6			0.6
Investments at fair value through profit or loss ⁶		153.9		153.9		130.9			130.9
Total financial assets	$	1,445.6	$	1,446.4	$	1,048.2		$	1,048.2
Financial liabilities at amortized cost
Trade and other payables^1, ³	$	305.0	$	305.0	$	330.5		$	330.5
Deferred Copper Mountain acquisition consideration⁷		14.9		14.8		17.5			17.4
Contingent Copper Mountain acquisition consideration⁷		13.6		14.3		14.1			13.9
Deferred land payments⁷		102.8		102.8		-			-
Agreements with communities⁸		90.8		89.5		107.2			105.9
Senior secured revolving credit facilities⁹		272.0		270.1		(2.3	)		(2.3	)
Senior unsecured notes¹⁰		545.7		539.4		1,022.7			1,010.9
Senior unsecured municipal bonds ¹¹		51.7		50.7		-			-
Wheaton refund liability¹²		14.1		8.3		13.9			7.9
Fair value through profit or loss
Non-hedge derivative liabilities ⁵		8.2		8.2		31.9			31.9
Total financial liabilities	$	1,418.8	$	1,403.1	$	1,535.5		$	1,516.1

¹Cash and cash equivalents, restricted cash, trade and other payables are recorded at carrying value, which approximates fair value due to their short-term nature and generally negligible credit losses.
² Fair value of the deferred consideration receivable has been determined using an applicable credit-risk adjusted discount rate (level 3).
³Excludes tax and other statutory amounts.
⁴ Trade and other receivables contain receivables including provisionally priced receivables classified as FVTPL and various other items at amortized cost. The fair value of provisionally priced receivables is determined using forward metals prices (level 2).
⁵Derivatives are carried at their fair value, which is determined based on observable forward market commodity prices corresponding to the maturity of the contract (level 2),
⁶Investments in listed shares are valued using quoted market bid prices in active markets. For Investments in private companies where no active market exists, fair value is determined using valuation techniques including recent arm's length market transactions.
⁷Fair value has been determined using an applicable credit-risk adjusted discount rate (level 3).
⁸These financial liabilities relate to agreements with communities in Peru (note 15). Fair values have been determined using an applicable credit-risk adjusted discounted rate and foreign exchange rates (level 3).
⁹Fair value of the senior secured revolving credit facility (note 17b) is equal to its carrying value as the drawn interest rate under the facility is comparable to current market rates.
¹⁰Fair value of the senior unsecured notes (note 17a) has been determined using an applicable credit-risk adjusted discount rate (level 3).
¹¹Fair value of the municipal bonds (note 17c) has been determined using comparable current market rates for similar instruments, adjusted for estimated credit spreads (level 2).
¹² Discounted value based on a market rate at inception of the applicable Wheaton contract for carrying value (note 15) and fair value using an applicable credit-risk adjusted discount rate (level 3).

Fair value hierarchy

The table below provides an analysis by valuation method of financial instruments that are measured at fair value subsequent to recognition as well as financial instruments not measured at fair value but for which a fair value is disclosed. Levels 1 to 3 are defined based on the degree to which fair value inputs are observable and have a significant effect on the recorded fair value, as follows:

- Level 1: Quoted prices in active markets for identical assets or liabilities;

- Level 2: Valuation techniques use significant observable inputs, either directly or indirectly, or valuations are based on quoted prices for similar instruments; and,

- Level 3: Valuation techniques use significant inputs that are not based on observable market data.

June 30, 2026

Level 1

Level 2

Level 3

Total

Financial assets at FVTPL:

Provisionally priced receivables

160.1

Non-hedge derivatives

3.2

Investments

150.9

3.0

153.9

Financial assets at amortized cost:

Deferred consideration receivable

172.2

150.9

163.3

175.2

489.4

Financial liabilities at FVTPL:

Non-hedge derivatives

8.2

Financial liabilities at amortized cost:

Deferred Copper Mountain acquisition consideration

14.9

Contingent Copper Mountain acquisition consideration

13.6

Deferred land payments

102.8

Agreements with communities

90.8

Senior secured revolving credit facilities

272.0

Senior unsecured notes

545.7

Senior unsecured municipal bonds

51.7

Wheaton refund liability

14.1

545.7

59.9

508.2

1,113.8

December 31, 2025		Level 1		Level 2		Level 3		Total
Financial assets at FVTPL:
Provisionally priced receivables	$	-	$	302.2	$	-	$	302.2
Non-hedge derivatives		-		0.6		-		0.6
Investments		127.9		-		3.0		130.9
	$	127.9	$	302.8	$	3.0	$	433.7
Financial liabilities at FVTPL:
Non-hedge derivatives	$	-	$	31.9	$	-	$	31.9
Financial liabilities at amortized cost:
Deferred Copper Mountain acquisition consideration		-		-		17.5		17.5
Contingent Copper Mountain acquisition consideration		-		-		14.1		14.1
Agreements with communities		-		-		107.2		107.2
Senior unsecured notes		1,022.7		-		-		1,022.7
Wheaton refund liability		-		-		13.9		13.9
	$	1,022.7	$	31.9	$	152.7	$	1,207.3

The Company's policy is to recognize transfers into and transfers out of fair value hierarchy levels as of the date of the event or change in circumstances that caused the transfer. During the six months ended June 30, 2026 and year ended December 31, 2025, Hudbay did not make any such transfers.

Valuation techniques used for instruments categorized in Levels 2 and 3 are consistent with the year ended December 31, 2025.

(b) Derivatives and hedging:

Copper fixed for floating swaps

Hudbay enters into copper fixed for floating swaps in order to manage the risk associated with provisional pricing terms in copper concentrate sales agreements. As at June 30, 2026, Hudbay had 55.5 million pounds of net copper swaps outstanding at an effective average price of $5.99/lb and settling from July to November 2026. As at December 31, 2025, Hudbay had 57.9 million pounds of net copper swaps outstanding at an effective average price of $5.18/lb and settling from January to May 2026. The aggregate fair value of the transactions at June 30, 2026 was a net liability of $4.5 million (December 31, 2025 - a net liability position of $26.4 million).

Gold fixed for floating swaps

Hudbay enters into gold fixed for floating swaps to manage the risk associated with provisional pricing terms on concentrate shipments. As at June 30, 2026, Hudbay had nil net gold swaps outstanding. As at December 31, 2025, Hudbay had 23,180 ounces of net gold swaps outstanding at an effective average price of $4,333/ounce and settling from January to February 2026. The aggregate fair value of the position at June 30, 2026 was nil (December 31, 2025 - a net liability of $4.9 million).

Zinc fixed for floating swaps

Hudbay enters into zinc fixed for floating swaps in order to manage the risk associated with provisional pricing terms in zinc concentrate sales agreements. As at June 30, 2026, Hudbay had nil net zinc swaps outstanding. As at December 31, 2025, Hudbay had 7.3 million pounds of net zinc swaps outstanding at an effective average price of $1.40/lb and settling in January 2026. The aggregate fair value of the transactions at June 30, 2026 was nil (December 31, 2025 - nil).

Copper forward sales

As at June 30, 2026, Hudbay had 6.6 million pounds of copper forwards outstanding at an effective average price of $6.03/lb and settling from July 2026 to April 2027. As at December 31, 2025, Hudbay had nil pounds of copper forwards outstanding. The aggregate fair value of the transactions at June 30, 2026 was a liability of $0.3 million (December 31, 2025 - nil).

Copper costless collars

As at June 30, 2026, Hudbay had 13.2 million pounds of copper collars outstanding settling from July 2026 to April 2027 at an average floor price of $5.76/lb and an average cap price of $6.36/lb. As at December 31, 2025, Hudbay had nil pounds of copper collars outstanding. The aggregate fair value of the position at June 30, 2026 was a liability of $0.2 million (December 31, 2025 - nil).

(c) Provisionally priced receivables

Changes in fair value of provisionally priced receivables

Hudbay records changes in fair value of provisionally priced receivables related to provisional pricing in concentrate purchase, concentrate sale and certain other sale contracts. Under the terms of these contracts, prices are subject to final adjustment at the end of a future period after title transfers based on quoted market prices during the quotation period specified in the contract. The period between provisional pricing and final pricing is typically up to three months.

Changes in fair value of provisionally priced receivables are presented in trade and other receivables when they relate to sales contracts and in trade and other payables when they relate to purchase contracts. At each reporting date, provisionally priced metals are marked-to-market based on the forward market price for the quotation period stipulated in the contract, with changes in fair value recognized in revenue for sales contracts and in inventory or cost of sales for purchase concentrate contracts. Cash flows related to changes in fair value of provisionally priced receivables are classified in operating activities.

As at June 30, 2026 and December 31, 2025, Hudbay's net position consisted of contracts awaiting final pricing are as indicated below:

Metal in
concentrate

Sales awaiting final pricing

Average YTD price ($/unit)

Unit

Jun. 30, 2026

Dec. 31, 2025

Jun. 30, 2026

Dec. 31, 2025

Copper

pounds (in 000s)

69,831

65,791

6.05

5.64

Gold

troy ounces

17,422

33,222

4,067

4,340

Silver

troy ounces

284,818

85,337

60.36

70.22

Zinc

pounds (in 000s)

8,365

1.40

The aggregate fair value of provisionally priced receivables within the copper and zinc concentrate at June 30, 2026 was a liability position of $9.5 million (December 31, 2025 - an asset position of $40.9 million).

24. Commitments

Capital commitments

As at June 30, 2026, Hudbay had outstanding capital commitments in Manitoba of approximately $54.9 million of which $52.4 million can be terminated, approximately $14.0 million in British Columbia of which $nil can be terminated, approximately $19.2 million in Peru all of which can be terminated, and approximately $114.5 million in Arizona, primarily related to the Copper World Complex, of which $112.3 million can be terminated.

25. Supplementary cash flow information

(a) Other operating activities:

		Three months ended June 30,						Six months ended June 30,
		2026			2025			2026			2025
Share-based compensation paid	$	(0.2	)	$	(1.1	)	$	(56.1	)	$	(9.8	)
Other		-			-			-			1.2
	$	(0.2	)	$	(1.1	)	$	(56.1	)	$	(8.6	)

(b) Change in non-cash working capital:

		Three months ended June 30,						Six months ended June 30,
		2026			2025			2026			2025
Change in:
Trade and other receivables	$	130.5		$	31.0		$	175.5		$	(1.4	)
Other financial assets/liabilities		11.3			2.7			(25.9	)		24.5
Inventories		(18.7	)		11.8			(13.8	)		14.6
Prepaid expenses		2.1			4.8			(0.9	)		7.0
Trade and other payables		(35.3	)		18.7			(38.4	)		(14.7	)
Provisions and other liabilities		(3.0	)		(3.0	)		(7.0	)		(2.7	)
	$	86.9		$	66.0		$	89.5		$	27.3

(c) Non-cash transactions:

During the six ended June 30, 2026 and 2025, Hudbay entered into the following non-cash investing and financing activities which are not reflected in the condensed consolidated interim statements of cash flows:

- Remeasurement of Hudbay's decommissioning and restoration liabilities led to a net increase in related property, plant and equipment assets of $19.3 million (June 30, 2025 - a net increase of $0.5 million), mainly related to changes to closure costs and real discount rates associated with remeasurement of the liabilities.

- Property, plant and equipment included $15.0 million (June 30, 2025 - $20.7 million) of capital additions related to the recognition of ROU assets and $56.3 million (June 30, 2025 - $8.2 million) of capital additions related to the recognition of property, plant and equipment that has been financed. Property, plant and equipment and other assets include nil capital additions related to agreements with communities (June 30, 2025 - $9.9 million). Property, plant and equipment includes $0.4 million deduction for accrued grants related to equipment eligible for credits (June 30, 2025 - $1.5 million).

- Property, plant and equipment includes $1,357.0 million of capital additions related to the purchase of ASCU that was purchased with 46,794,082 Hudbay common shares and $123.1 million of ASCU shares held by Hudbay (note 4).

26. Segmented information

Hudbay has the following reportable segments identified by the individual mining operations of Manitoba, British Columbia, Peru, Copper World project and Cactus project. Corporate and other activities are not considered an operating segment and are included as a reconciliation to total consolidated results. Corporate and other activities include the Company's exploration activities in Chile, Canada and the State of Nevada. These exploration entities are not individually significant, as they do not meet the minimum quantitative thresholds for standalone segment disclosure. Hudbay's second quarter 2026 income before tax was not affected by the ASCU Transaction as the Cactus project had no income or expenses recorded during the six day stub period from the date of acquisition to the end of the second quarter. No results for the Cactus project segment are reflected in the prior period comparative figures.

Three months ended June 30, 2026

Peru

Manitoba

British
Columbia

Copper
World
Project

Cactus
Project

Corporate
and other
activities

Total

Revenue from external customers

273.3

258.4

99.6

631.3

Cost of sales

Mine operating costs

112.4

90.9

70.2

273.5

Depreciation and amortization

45.4

21.2

22.2

88.8

Gross profit

115.5

146.3

7.2

269.0

Selling and administrative expenses

19.9

Exploration expenses

5.8

13.4

19.2

Other operating expenses (income)

5.5

(6.6

)

0.6

0.3

4.9

4.7

Re-evaluation adjustment - environmental provision

5.5

Results from operating activities

104.2

134.0

6.6

(0.3

)

(24.8

)

219.7

Interest expense on long term debt

13.3

Accretion on streaming arrangements

4.5

Change in fair value of financial instruments

(48.7

)

Other net finance expense

10.2

Income before tax

240.4

Three months ended June 30, 2025
		Peru		Manitoba			British Columbia		Copper World Project			Corporate and other activities			Total
Revenue from external customers	$	259.6	$	193.0		$	83.8	$	-		$	-		$	536.4
Cost of sales
Mine operating costs		127.8		74.3			61.4		-			-			263.5
Depreciation and amortization		56.0		23.6			16.8		-			-			96.4
Gross profit		75.8		95.1			5.6		-			-			176.5
Selling and administrative expenses		-		-			-		-			20.7			20.7
Exploration expenses		5.4		4.0			-		-			-			9.4
Other operating expenses (income)		3.4		4.2			0.7		0.1			(1.3	)		7.1
Re-evaluation adjustment - environmental provision		-		(13.8	)		-		-			-			(13.8	)
Results from operating activities	$	67.0	$	100.7		$	4.9	$	(0.1	)	$	(19.4	)	$	153.1
Interest expense on long term debt															15.6
Accretion on streaming arrangements															5.2
Change in fair value of financial instruments															(4.1	)
Other net finance income															(16.7	)
Income before tax														$	153.1

Six months ended June 30, 2026

Peru

Manitoba

British
Columbia

Copper
World
Project

Cactus
Project

Corporate
and other
activities

Total

Revenue from external customers

636.3

544.9

207.4

1,388.6

Cost of sales

Mine operating costs

247.6

171.1

144.2

562.9

Depreciation and amortization

106.8

41.2

40.7

188.7

Gross profit

281.9

332.6

22.5

637.0

Selling and administrative expenses

54.3

Exploration expenses

8.5

26.9

35.4

Other operating expenses (income)

13.2

(2.3

)

0.9

0.1

2.9

14.8

Re-evaluation adjustment - environmental provision

7.6

Results from operating activities

260.2

300.4

21.6

(0.1

)

(57.2

)

524.9

Interest expense on long term debt

27.7

Accretion on streaming arrangements

9.0

Change in fair value of financial instruments

(111.6

)

Other net finance expense

20.4

Income before tax

579.4

Six months ended June 30, 2025
		Peru		Manitoba			British Columbia		Copper World Project			Corporate and other activities			Total
Revenue from external customers	$	549.3	$	417.8		$	164.2	$	-		$	-		$	1,131.3
Cost of sales
Mine operating costs		256.3		146.8			115.9		-			-			519.0
Depreciation and amortization		124.2		47.5			32.8		-			-			204.5
Gross profit		168.8		223.5			15.5		-			-			407.8

Selling and administrative expenses		-		-			-		-			34.4			34.4
Exploration expenses		8.7		14.6			-		-			-			23.3
Other operating expenses (income)		5.4		6.7			2.4		0.2			(2.4	)		12.3
Re-evaluation adjustment - environmental provision		-		(1.0	)		-		-			-			(1.0	)
Results from operating activities	$	154.7	$	203.2		$	13.1	$	(0.2	)	$	(32.0	)	$	338.8
Interest expense on long term debt															31.5
Accretion on streaming arrangements															9.6
Change in fair value of financial instruments															(9.3	)
Other net finance income															(17.4	)
Income before tax														$	324.4

June 30, 2026

Peru

Manitoba

British
Columbia

Copper
World
Project

Cactus
Project

Corporate
and other
activities

Total

Total assets

2,373.6

417.5

1,384.0

1,772.6

1,371.6

742.7

8,062.0

Total liabilities

874.1

448.5

279.6

153.2

104.6

941.4

2,801.4

Property, plant and equipment¹

1,804.9

593.8

1,159.8

1,212.9

1,361.1

64.0

6,196.5

Other non-current assets²

59.2

21.4

9.9

173.1

0.4

264.0

¹ Included in Corporate and other activities are $52.7 million of property, plant and equipment that is located in Nevada.

² Other non-current assets includes receivables, inventory, intangibles and other assets.

December 31, 2025
		Peru		Manitoba		British Columbia		Copper World Project		Corporate and other activities		Total
Total assets	$	2,492.0	$	471.5	$	1,320.2	$	1,147.5	$	792.1	$	6,223.3
Total liabilities		1,031.3		424.3		269.2		103.6		1,163.9		2,992.3
Property, plant and equipment¹		1,815.7		604.3		1,082.6		1,144.9		46.4		4,693.9
Other non-current assets²		64.3		21.4		9.9		0.2		0.5		96.3
¹ Included in Corporate and other activities is $33.9 million of property, plant and equipment that is located in Nevada.
² Other non-current assets includes receivables, inventory, intangibles and other assets.

Management's Discussion and Analysis of

Results of Operations and Financial Condition

For the three and six months ended

June 30, 2026

July 28, 2026

TABLE OF CONTENTS	Page

Introduction	1

Hudbay's Business	1

Hudbay's Purpose	2

Summary	2

Key Financial Results	5

Key Production Results	6

Key Costs Results	6

Recent Developments	7

Peru Operations Review	11

Manitoba Operations Review	17

British Columbia Operations Review	22

Financial Review	27

Liquidity and Capital Resources	37

Trend Analysis and Quarterly Review	42

Non-GAAP Financial Performance Measures	44

Accounting Changesand Critical Estimates	67

Changes in Internal Control over Financial Reporting	68

Notes to Reader	68

Summary of Historical Results	71

INTRODUCTION

This Management's Discussion and Analysis ("MD&A") dated July 28, 2026 is intended to supplement Hudbay Minerals Inc.'s unaudited condensed consolidated interim financial statements and related notes for the three and six months ended June 30, 2026 and 2025 (the "consolidated interim financial statements"). The consolidated interim financial statements have been prepared in accordance with IFRS^® Accounting Standards ("IFRS" or "GAAP") as issued by the International Accounting Standards Board ("IASB").

References to "Hudbay" or the "Company" refer to Hudbay Minerals Inc. and its direct and indirect subsidiaries as at June 30, 2026.

Readers should be aware that:

^- This MD&A contains certain "forward-looking statements" and "forward-looking information" (collectively, "forward-looking information") that are subject to risk factors set out in a cautionary note contained in Hudbay's MD&A.

- This MD&A has been prepared in accordance with the requirements of the securities laws in effect in Canada, which may differ materially from the requirements of United States securities laws applicable to US issuers.

- Hudbay uses a number of non-GAAP financial performance measures in Hudbay's MD&A, which do not have standardized meaning under IFRS. For further information and detailed reconciliations of such measures, please see the discussion under the "Non-GAAP Financial Performance Measures" section herein.

- The technical and scientific information in this MD&A has been approved by qualified persons based on a variety of assumptions and estimates. Please see the discussion under the "Qualified Persons and NI 43-101" section herein.

Readers are also urged to review the "Notes to Reader" section beginning on page 68 of this MD&A.

Additional information regarding Hudbay, including the risks related to its business and those that are reasonably likely to affect its consolidated interim financial statements in the future, is contained in Hudbay's continuous disclosure materials, including its most recent Annual Information Form, consolidated interim financial statements and Management Information Circular available on SEDAR+ at www.sedarplus.ca and on EDGAR at www.sec.gov.

All amounts are in US dollars unless otherwise noted.

HUDBAY'S BUSINESS

Hudbay is a copper-focused critical minerals company with three long-life operations and a world-class pipeline of copper growth projects in tier-one mining jurisdictions of Canada, Peru and the United States. Hudbay's operating portfolio includes the Constancia mine in Cusco (Peru), the Snow Lake operations in Manitoba (Canada) and the Copper Mountain mine in British Columbia (Canada). Copper is the primary metal produced by the Company, which is complemented by meaningful gold production and by-product zinc, silver and molybdenum. The Company's growth pipeline includes the Copper World project in Arizona (United States), the Cactus project in Arizona (United States), the Mason project in Nevada (United States), the Llaguen project in La Libertad (Peru) and several expansion and exploration opportunities near its existing operations. Hudbay is governed by the Canada Business Corporations Act and its shares are listed under the symbol "HBM" on the Toronto Stock Exchange, New York Stock Exchange and Bolsa de Valores de Lima.

HUDBAY'S PURPOSE

Hudbay transforms lives: Hudbay invests in its employees, their families and local communities through long-term employment, local procurement and economic development to improve their quality of life and ensure the communities benefit from the Company's presence.

Hudbay operates responsibly: From exploration to closure, Hudbay operates safely and responsibly, welcomes innovation and strives to minimize its environmental footprint while following leading operating practices in all facets of mining.

Hudbay provides critical metals: Hudbay produces copper and other metals needed for everyday products and essential for applications to support the energy transition toward a more sustainable future.

SUMMARY

Delivered Strong Second Quarter Financial Results; Production Guidance Reaffirmed and Cost Guidance Improved

• Achieved quarterly revenue of $631.3 million, net earnings attributable to owners¹ of $137.4 million, quarterly adjusted EBITDA¹ of $321.2 million and adjusted net earnings attributable to owners¹ of $113.5 million in the second quarter, driven by steady operating performance, attractive operating margins and strong exposure to copper and gold across Hudbay's diversified operating portfolio.

• Steady production continued in the second quarter with consolidated copper and gold production of 28,267 tonnes and 51,234 ounces, respectively, with higher copper production in line with quarterly cadence expectations while gold production was slightly lower than quarterly cadence expectations.

• Industry-leading margins continue to be achieved with consolidated cash cost¹and sustaining cash cost¹, net of by-product credits, of $(0.40) and $1.39, per pound of copper respectively, in the second quarter of 2026.

• Reaffirmed full year 2026 consolidated production guidance including 110,000 to 138,000 tonnes of copper and 217,000 to 272,000 ounces of gold.

• Improved full year 2026 consolidated cash cost¹ guidance to $(0.45) to $(0.25) per pound of copper from $(0.30) to $(0.10) per pound as costs are tracking well below the low end of the guidance range given strong exposure to gold by-product credits and continued operating efficiencies are more than offsetting higher input costs for fuel and consumables.

• Peru operations produced 19,446 tonnes of copper and 5,282 ounces of gold in the second quarter of 2026, in line with quarterly cadence expectations with a planned semi-annual plant maintenance shutdown during the quarter. Peru cash cost¹, net of by-product credits, of $1.66 per pound outperformed the low end of the 2026 annual guidance range of $1.70 to $2.10 per pound despite the lower planned production and higher fuel costs.

• Manitoba operations produced 40,344 ounces of gold, 2,366 tonnes of copper, 4,760 tonnes of zinc and 209,478 ounces of silver in the second quarter of 2026, slightly lower than quarterly cadence expectations. Manitoba cash cost¹ of $776 per ounce of gold was within the annual guidance range of $500 to $800 per ounce.

• British Columbia operations produced 6,455 tonnes of copper, 5,608 ounces of gold and 71,178 ounces of silver in the second quarter of 2026, in line with quarterly cadence expectations. British Columbia cash cost¹ of $3.22 per pound of copper was higher than the annual cost guidance range of $1.50 to $2.50 per pound primarily due to elevated fuel prices and timing of equipment maintenance. British Columbia cash cost is expected to improve in the second half of the year, in line with the annual guidance range.

• Second quarter earnings per share attributable to owners was $0.34, reflecting strong gross profit margins as a result of the continued focus on strong cost control and higher metal prices more than offsetting higher input costs. After adjusting for various non-cash items on a pre-tax basis, second quarter adjusted earnings¹ per share attributable to owners was $0.28.

• Cash and cash equivalents were $890.9 million and total liquidity² was $1,044.6 million at the end of the second quarter of 2026, despite using cash to retire over $200 million in long term debt and benefitting from the approximate $420 million initial cash contribution from Mitsubishi Corporation ("Mitsubishi") received on closing of the Copper World joint venture transaction in January 2026.

Continued Strong Cash Flow Generation and Prudent Balance Sheet Management

• Hudbay's unique copper and gold diversification across its operations provides exposure to higher copper and gold prices, which together with a focus on cost control across the business, continues to realize strong margins and generate significant free cash flow.

• While the majority of Hudbay's revenue continues to be derived from copper production, revenue from gold production represents a meaningful portion of total revenues. Gold revenues were 38% of total revenue in the second quarter of 2026.

• Cash generated from operating activities was $297.0 million during the second quarter of 2026, reflecting an increase of $85.7 million compared to the first quarter partially as a result of favourable changes in non-cash working capital.

• Operating cash flow before changes in non-cash working capital was $210.1 million during the second quarter of 2026, relatively consistent with the first quarter.

• Delivered free cash flow¹ generation of $101.8 million during the second quarter of 2026, representing a similar level of free cash flow generation to the first quarter through continued strong operating margins and cost controls, resulting in more than $200 million of free cash flow generated in the first half of 2026 despite investing over $200 million of sustaining capital in the business over this period.

• Achieved quarterly adjusted EBITDA¹of $321.2 million in the second quarter of 2026, resulting in record trailing twelve month adjusted EBITDA¹ of $1,271.6 million.

• Achieved net debt¹of negative $80.5 million as at June 30, 2026, representing an $86.1 million improvement from the first quarter of 2026 and positioning the Company well to reinvest in high-return growth capital projects across the business.

• Net debt to adjusted EBITDA ratio¹ was negative 0.1x in the second quarter of 2026, significantly improved from 0.4x in the fourth quarter of 2025 as a result of the initial proceeds received from Mitsubishi on closing of the Copper World joint venture transaction along with strong cash flows from operations.

• Consistent with Hudbay's prudent balance sheet management and focus on cost of capital, Hudbay repaid $472.5 million of its outstanding 2026 senior unsecured notes on maturity on April 1, 2026, using a combination of cash on hand and a $272 million draw on its low-cost revolving credit facilities, providing the Company with enhanced financial flexibility in advance of a Copper World sanctioning decision later this year.

• Received proceeds of an offering of $52 million in aggregate principal amount of solid waste disposal revenue bonds with an initial mandatory tender date in 2036. These long-term, low-cost, non-amortizing U.S. municipal bonds, may be used for certain eligible costs associated with the development of Copper World.

• Hudbay's enhanced Capital Allocation Framework is embedded into its annual financial planning cycle to provide a holistic approach to capital allocation decisions to maximize long-term risk-adjusted returns, including capital deployment into brownfield projects, greenfield projects, strategic investments and exploration, while considering debt repurchases, share buybacks and dividends.

Advancing Generational Growth Investments to Further Enhance Copper and Gold Exposure

• The Copper World definitive feasibility study ("DFS") is progressing well, and a project sanctioning decision continues to be on track for late 2026. The DFS is expected to include scope for future mill expansion optionality.

• Completed the acquisition of Arizona Sonoran Copper Company Inc. ("ASCU") to bring together two highly complementary copper growth assets in Arizona and strengthen Hudbay's position as a premier Americas-focused copper company with a pipeline of long-life, low-cost assets located in tier-one jurisdictions. The acquisition of ASCU enhances Hudbay's long-term copper production profile and expands its U.S. growth pipeline through the staged development of Copper World and Cactus. Hudbay expects to spend approximately $30 million at Cactus in the second half of 2026 to advance an updated pre-feasibility study, perform site de-risking activities, conduct exploration activities and for other ongoing site costs.

• Continued to advance a large Snow Lake exploration program to further increase near-term production and mineral reserves, test regional satellite deposits for additional mill feed to utilize available capacity at Stall and explore the large land package for a new anchor deposit to meaningfully extend mine life.

• Celebrated the official groundbreaking of the New Ingerbelle expansion project at Copper Mountain, marking a significant milestone for the operation and its long-term future in British Columbia, enhancing the copper and gold production profile and securing a longer mine life. Growth capital expenditures in British Columbia in 2026 are expected to increase by approximately $30 million to $115 million due to additional costs associated with the development of infrastructure for New Ingerbelle.

• Received approval from the government in Peru to further increase annual mill processing capacity at Constancia to 34 million tonnes of ore per annum from the previously permitted 31 million tonnes, enabling additional capacity to further optimize Constancia's operations and deliver strong copper production.

• Advanced initial pre-feasibility study activities at the Mason copper project in Nevada.

Summary of Second Quarter Results

Hudbay's diversified asset portfolio delivered consolidated copper production of 28,267 tonnes and consolidated gold production of 51,234 ounces in the second quarter of 2026. Consolidated copper production was higher than the first quarter of 2026 as higher mill throughput in British Columbia more than offset lower planned mill throughput in Peru. Consolidated gold production was lower than the first quarter of 2026 primarily due to lower milled gold grades. Consolidated silver production of 845,161 ounces was higher than the first quarter of 2026 due to higher grades and recoveries in British Columbia. Zinc production of 4,760 tonnes in the second quarter of 2026 also increased compared to the previous quarter, primarily reflecting higher ore grades at the Manitoba operations.

Cash generated from operating activities was $297.0 million during the second quarter of 2026, reflecting an increase of $85.7 million compared to the first quarter of 2026 and an increase of $37.1 million compared to the same period in 2025. The increases are partially as a result of favourable changes in non-cash working capital. Operating cash flow before changes in non-cash working capital was $210.1 million during the second quarter of 2026 and remained relatively consistent with the first quarter of 2026 and second quarter of 2025.

Adjusted EBITDA¹was $321.2 million in the second quarter of 2026, a decrease compared to the record $421.9 million achieved in the first quarter of 2026, primarily due to lower sales volumes, partially offset by higher copper prices. Second quarter adjusted EBITDA¹ increased by 31% compared to $245.2 million in the second quarter of 2025 as a result of higher metal prices partially offset by lower sales volumes of all metals. The lower sales volumes in the second quarter of 2026 was impacted by a temporary build-up of concentrate inventory at the port in Peru. This accumulation was caused by ocean swells that resulted in temporary port closures and delayed scheduled shipments of approximately 10,000 dry metric tonnes of copper concentrate which were delivered in the first half of July 2026.

Net earnings attributable to owners was $137.4 million, or $0.34 per share, in the second quarter of 2026 compared to $190.4 million, or $0.48 per share, in the first quarter of 2026. The decrease is primarily the result of lower revenue due to lower sales volumes of all metals.

Adjusted net earnings attributable to owners¹and adjusted net earnings per share attributable to owners¹ in the second quarter of 2026 were $113.5 million and $0.28 per share, respectively, after adjusting for various non-cash items on a pre-tax basis including a $38.2 million mark-to-market revaluation net gain on various financial instruments such as investments and share-based compensation, a non-cash $12.0 million foreign exchange loss, an $11.5 million business interruption insurance recovery related to the Manitoba mandatory wildfire evacuations shutdowns in 2025, among other items. This compares to adjusted net earnings attributable to owners¹ and net earnings per share attributable to owners¹ of $161.0 million and $0.40 per share, respectively, in the first quarter of 2026. The decrease is a result of lower realized metal prices for gold and the aforementioned lower sales volumes.

Consolidated cash cost¹, net of by-product credits, in the second quarter of 2026 was $(0.40) per pound of copper, compared to record low cash cost of $(1.80) per pound in the first quarter of 2026. The increase from the first quarter of 2026 was a result of lower by-product credits from lower gold volumes. When compared to the second quarter of 2025, consolidated cash cost¹, net of by-product credits¹ decreased by $0.38 per pound as a result of higher by-product credits, partially offset by lower production.

Consolidated sustaining cash cost¹, net of by-product credits, in the second quarter of 2026 was $1.39 per pound of copper, compared to $0.00 per pound in the first quarter of 2026. This increase was primarily due to the same factors impacting consolidated cash cost noted above. When compared to the second quarter of 2025, consolidated sustaining cash cost¹, net of by-production credits decreased by $0.26 per pound due to the same factors impacting consolidated cash cost noted above.

Consolidated all-in sustaining cash cost¹, net of by-product credits, in the second quarter of 2026 was $1.80 per pound of copper, higher than the first quarter of 2026 due to the same reasons noted above, partially offset by lower corporate general and administrative ("G&A") costs from the impact of the revaluation of Hudbay's share-based compensation.

As at June 30, 2026, total liquidity² was $1,044.6 million, including $890.9 million in cash and cash equivalents, which excludes $49.8 million in U.S. municipal bond proceeds that is classified as restricted cash, and undrawn availability of $153.7 million under Hudbay's revolving credit facilities. Net debt¹ at the end of the second quarter was negative $80.5 million, marking an $86.1 million improvement from first quarter of 2026, primarily as a result of positive cash flows from operations. Hudbay expects that the current liquidity, together with cash flows from operations, will be sufficient to meet the Company's liquidity needs for the next 12 months.

KEY FINANCIAL RESULTS

Financial Condition
(in $ millions, except net debt to adjusted EBITDA ratio)		Jun. 30, 2026			Dec. 31, 2025
Cash and cash equivalents¹	$	890.9		$	568.9
Total long-term debt		860.2			1,008.6
Net debt^{2, 3}		(80.5	)		439.7
Working capital⁴		751.8			(65.6	)
Total assets		8,062.0			6,223.3
Equity attributable to owners of the Company		4,797.2			3,231.0
Net debt to adjusted EBITDA ²		(0.1	)		0.4

¹As at June 30, 2026 cash and cash equivalents include $334.5 million in cash held by Copper World LLC. These funds are contractually restricted solely for the advancement of the Copper World project and are not available to the general Hudbay group.

²Net debt and net debt to adjusted EBITDA are non-GAAP financial performance measures with no standardized definition under IFRS. For further information, please see discussion under the "Non-GAAP Financial Performance Measures" section of this MD&A.

³Hudbay calculates net debt as total long-term debt less cash and cash equivalents and restricted cash related to unspent proceeds of its senior unsecured municipal bond financing.

⁴Working capital is determined as total current assets less total current liabilities as defined under IFRS and disclosed on the consolidated interim financial statements.

Financial Performance		Three months ended						Six months ended
(in $ millions, except per share amounts or as noted below)		Jun. 30, 2026		Mar. 31, 2026		Jun. 30, 2025		Jun. 30, 2026		June. 30, 2025
Revenue	$	631.3	$	757.3	$	536.4	$	1,388.6	$	1,131.3
Cost of sales		362.3		389.3		359.9		751.6		723.5
Earnings before tax		240.4		339.0		153.1		579.4		324.4
Net earnings		138.1		191.5		114.7		329.6		213.9
Net earnings attributable to owners		137.4		190.4		117.7		327.8		218.1
Basic and diluted earnings per share - attributable		0.34		0.48		0.30		0.82		0.55
Adjusted earnings per share - attributable¹		0.28		0.40		0.19		0.69		0.43
Operating cash flow before change in non-cash working capital		210.1		208.7		193.9		418.8		357.4
Adjusted EBITDA¹		321.2		421.9		245.2		743.1		532.4
Free cash flow¹		101.8		102.3		86.7		204.7		171.1

¹ Adjusted earnings per share - attributable to owners, adjusted EBITDA and free cash flow are non-GAAP financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see discussion under the "Non-GAAP Financial Performance Measures" section of this MD&A.

KEY PRODUCTION RESULTS

		Three months ended			Six months ended		Guidance
		Jun. 30, 2026	Mar. 31, 2026	Jun. 30, 2025	Jun. 30, 2026	Jun. 30, 2025	Annual 2026
Contained metal in concentrate and doré produced¹
Copper	tonnes	28,267	27,929	29,956	56,196	60,914	110,000 - 138,000
Gold	oz	51,234	61,700	56,271	112,934	130,055	217,000 - 272,000
Silver	oz	845,161	787,449	814,989	1,632,610	1,734,764	2,900,000 - 3,690,000
Zinc	tonnes	4,760	4,565	5,130	9,325	11,395	16,000 - 21,000
Molybdenum	tonnes	277	380	375	657	772	900 - 1,100
Payable metal sold
Copper	tonnes	23,780	29,544	30,354	53,324	62,122
Gold²	oz	56,266	66,562	62,466	122,828	137,558
Silver²	oz	674,490	923,051	894,160	1,597,541	1,901,128
Zinc	tonnes	2,635	3,897	2,871	6,532	7,728
Molybdenum	tonnes	298	375	427	673	875

¹Metal reported in concentrate is prior to deductions associated with smelter contract terms and includes other secondary products.
² Includes total payable gold and silver in concentrate and in doré sold and other secondary products.

KEY COST RESULTS

		Three months ended						Six months ended				Guidance
		Jun. 30, 2026		Mar. 31, 2026		Jun. 30, 2025		Jun. 30, 2026		Jun. 30, 2025		Annual 2026²
Peru cash cost per pound of copper produced
Cash cost¹	$/lb	1.66		0.70		1.45		1.17		1.29		1.70 - 2.10
Sustaining cash cost¹	$/lb	2.71		1.43		2.63		2.05		2.29
Manitoba cash cost per ounce of gold produced
Cash cost¹	$/oz	776		408		710		577		515		500 - 800
Sustaining cash cost¹	$/oz	1,358		833		1,025		1,074		793
British Columbia cash cost per pound of copper produced
Cash cost¹	$/lb	3.22		2.41		2.39		2.87		2.41		1.50 - 2.50
Sustaining cash cost¹	$/lb	6.23		7.81		5.18		6.91		4.69
Consolidated cash cost per pound of copper produced
Cash cost¹	$/lb	(0.40	)	(1.80	)	(0.02	)	(1.09	)	(0.24	)	(0.45) - (0.25	)
Sustaining cash cost¹	$/lb	1.39		0.00		1.65		0.70		1.18		1.70 - 2.10
All-in sustaining cash cost¹	$/lb	1.80		0.73		2.03		1.26		1.49

¹Cash cost, sustaining cash cost, all-in sustaining cash cost per pound of copper produced, net of by-product credits, gold cash cost, sustaining cash cost per ounce of gold produced, and net of by-product credits are non-GAAP financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-GAAP Financial Performance Measures" section of this MD&A.

²Improved full year 2026 consolidated copper cash cost guidance range to $(0.45) to $(0.25) per pound from the original guidance range of $(0.30) to $(0.10) per pound.

RECENT DEVELOPMENTS

Key Leadership Appointments

Hudbay is pleased to announce senior management team appointments as the Company positions itself for the next phase of transformational growth. Eugene Lei has been appointed President and Chief Financial Officer, with Peter Kukielski continuing as Chief Executive Officer. Robert Carter has been appointed Chief Operating Officer, transitioning from Andre Lauzon who will retire at the end of September.

Mr. Lei has been Chief Financial Officer since 2022 and has been responsible for providing strategic financial and capital markets leadership at Hudbay. He has been instrumental in the Company's significant transformation, and under his leadership, Hudbay successfully executed the strategic plan to unlock Copper World, which included achieving stated balance sheet targets ahead of schedule and prudently allocating capital to maximize shareholder value. He currently serves as the Chair of the Copper World Joint Venture board. Mr. Lei joined Hudbay in 2012 and progressed through several senior management roles with increasing executive responsibilities. He has over 25 years of global mining finance, investment banking and corporate development experience. Prior to joining Hudbay, Mr. Lei was Managing Director, Mining at Macquarie Capital Markets, working as an advisor on transformative mining mergers and acquisitions and leading equity capital markets offerings. He holds a Bachelor of Commerce (Honours) degree from Queen's University. In 2025, Mr. Lei was the recipient of the Globe and Mail's Report on Business 2025 Canada's Best Executive Award in the Finance category. In 2015, Mr. Lei received the Canadian Institute of Mining, Metallurgy and Petroleum's CIM-Bedford Canadian Young (under 40) Mining Leaders Award.

Mr. Carter was appointed Senior Vice President, Canada in June 2025, and as leader of the Canadian operations, he has been responsible for the strategic oversight of Hudbay's business activities in Manitoba and British Columbia. His leadership in Manitoba revitalized the operations into a sustainable cash flow contributor and he has strategically positioned the British Columbia operations for long-term success. Mr. Carter's extensive experience with a deep focus on safety and continuous improvement has been invaluable at the operations and is seen through consistent operational execution. Previously, he held the role of Vice President, Manitoba Business Unit since April 2022 and prior to that was the General Manager of the Company's Manitoba mines since 2018. He has held various other positions at Hudbay, including Manager of the Lalor Mine in Manitoba and Director of Business Development and Technical Services in Hudbay's corporate group. He has nearly 30 years of mining industry experience in technical, operational and senior leadership roles, with the majority of those years at Hudbay. Mr. Carter holds a Bachelor of Science, Geological Engineering from the University of Manitoba and is a Professional Engineer registered with Professional Engineers Ontario and Engineers Geoscientists of Manitoba.

The Company is grateful for Mr. Lauzon's significant contributions since joining Hudbay in 2016. Mr. Lauzon was the architect of the Copper World project, and his valued expertise as Chief Operating Officer has positioned the Company's operating and growth platform for long-term success. Mr. Lauzon has worked closely with Mr. Lei over the past several years on operational finance and growth, focusing the business on delivering strong free cash flow. He has also worked closely with Mr. Carter in optimizing the Company's Canadian operations and de-risking many growth projects across the business, and Mr. Carter's appointment ensures a seamless transition in accordance with Hudbay's succession planning. In his retirement, Mr. Lauzon will also provide on-going consulting and advisory services to Hudbay.

Hudbay has appointed Sebastien Fortin as Vice President and Head of the British Columbia Business Unit ("BCBU"). Mr. Fortin has been serving as Acting Head of the BCBU since October 2025 after first joining Copper Mountain as General Manager of Operations in 2024. Under his leadership, the operations have achieved many productivity and safety objectives, and he continues to drive significant improvements across the business to position Copper Mountain for long-term success. Mr. Fortin is a Professional Mining Engineer and he previously worked at Teck Resources for 16 years in several senior technical roles before joining Hudbay. He holds a bachelor's degree in Geological Engineering and a master's degree in Mining Engineering, both from Laval University, and is a graduate of the MBA Program at Simon Fraser University.

Hudbay also announced that Warren Flannery is taking on an expanded role as Vice President and Head of the Arizona Business Unit, and he will continue to support Javier Del Rio, Senior Vice President and Head of Hudbay USA. Under this enhanced role, Mr. Flannery is responsible for leading the business development and operational readiness of Copper World and the advancement of the Cactus project through feasibility studies and key de-risking initiatives. He previously held the role of Vice President of Copper World since August 2024 and he first joined Hudbay in 2023 as Vice President, Business Planning and Reclamation. Mr. Flannery is an experienced mining professional with over 30 years of extensive experience in mine operations, planning and project development at global companies. Prior to joining Hudbay, Mr. Flannery was the head of the mining technical group at CIBC's global mining corporate and investment banking arm for ten years. He is a Professional Engineer and holds a master's degree in Mineral Economics from the Colorado School of Mines and a bachelor's degree in Mining Engineering from Queen's University.

Continued Free Cash Flow Generation Driven by Strong Operating Margins; External Cost Pressures Insulated by Diversified Copper and Gold Exposure

Hudbay's unique copper and gold diversification across its operations provides exposure to strong commodity prices, which together with a focus on cost control across the business, continues to realize strong margins and generate attractive free cash flow. While the majority of Hudbay's revenue continues to be derived from copper production, revenue from gold production represents a meaningful portion of total revenues, with gold accounting for 38% of total revenue in the second quarter of 2026.

Hudbay's cost control efforts are focused on navigating external cost pressures, such as higher fuel and consumable costs. The Company continues to manage costs and deliver strong margins through initiatives to further improve throughput and enhance operating efficiencies. Despite such external cost pressures in the second quarter, Hudbay achieved consolidated cash cost¹ of negative $0.40 per pound of copper and generated operating cash flow of over $200 million and free cash flow of over $100 million, similar to the first quarter of 2026. Hudbay continues to benefit from its diversified platform with significant by-product credits from gold production.

The Company had $890.9 million in cash and cash equivalents and net debt¹of negative $80.5 million at the end of the second quarter of 2026. Hudbay's strong cash position and continued prudent balance sheet management position the Company well to advance its generational growth investments across the portfolio and allocate capital to the highest risk-adjusted return opportunities to deliver significant value for stakeholders.

Copper World DFS Progressing Well and Project Sanctioning on Track for Late 2026

In January 2026, Hudbay announced the closing of the joint venture transaction with Mitsubishi, securing a premier, long-term strategic partner for the development of Copper World. The $420 million of initial proceeds received at closing from Mitsubishi will be used to directly fund the remaining DFS costs and pre-sanctioning costs in addition to the initial project development costs for Copper World. Mitsubishi will contribute an additional $180 million within 18 months of closing to complete its 30% minority investment and will also fund its pro-rata 30% share of future equity capital contributions.

Feasibility activities for the Copper World DFS are progressing well, with 95% of the engineering work completed and a sanctioning decision remains on track for later in 2026. The DFS is expected to reflect higher capital expenditures as compared to the 2023 pre-feasibility study primarily due to typical cost inflation along with new capital related to project scope changes that would allow for future mill expansion optionality, while continuing to generate robust economics.

On June 24, 2026, Copper World LLC received proceeds of an offering of $52.0 million aggregate principal amount of solid waste disposal revenue bonds due July 2, 2036 (the "Municipal Bonds"). The Municipal Bonds were issued by the Arizona Industrial Development Authority at par and carry a fixed interest rate of 4.5% per annum, with interest payable by Copper World LLC semi-annually. The Municipal Bond proceeds may be used for certain eligible costs associated with the development of the Copper World project and are treated as restricted cash on Hudbay's balance sheet.

Completion of the Arizona Sonoran Acquisition to Create the Third Largest Copper District in North America

On June 24, 2026, Hudbay successfully completed its previously announced acquisition of ASCU, pursuant to which Hudbay acquired all of the issued and outstanding common shares of ASCU not already owned by Hudbay (the "ASCU Transaction").

As a result of the completion of the ASCU Transaction, ASCU became a wholly-owned subsidiary of Hudbay and Hudbay acquired 100% ownership of Arizona Sonoran's Cactus project. In aggregate, Hudbay issued 46,794,082 Hudbay common shares under the ASCU Transaction to former ASCU shareholders as consideration for their Arizona Sonoran shares. Following the closing of the ASCU Transaction, the Arizona Sonoran shares were de-listed from the Toronto Stock Exchange ("TSX") and Arizona Sonoran ceased to be a reporting issuer pursuant to applicable Canadian securities laws.

The ASCU Transaction brings together two highly complementary copper growth assets in Arizona and strengthens Hudbay's position as a premier Americas-focused copper company with a pipeline of long-life, low-cost assets located in tier-one jurisdictions. The ASCU Transaction is expected to enhance Hudbay's long-term copper production profile, expand its U.S. growth pipeline, and generate significant operational efficiencies and regional synergies with Hudbay's staged development of Copper World and Cactus.

Hudbay expects to spend approximately $30 million at Cactus in the second half of 2026 to advance an updated pre-feasibility study ("PFS"), perform site de-risking activities, conduct exploration activities and for other ongoing site costs. The updated Cactus PFS is expected to be completed in the second half of 2027.

New Ingerbelle Expansion Project Underway to Enhance Copper and Gold Production Profile at Copper Mountain

In June 2026, Hudbay celebrated the official groundbreaking of the New Ingerbelle expansion project at Copper Mountain, marking a significant milestone for the operation and its long-term future in British Columbia. The event was attended by Hudbay's executive team, employees, B.C.'s Minister of Mining and Critical Minerals, the B.C. Mining Association, the Chief of the Upper Similkameen Indian Band, regional representatives, and leaders from the local community. The event was also recognized by Canada's Minister of Energy and Natural Resources.

New Ingerbelle enhances the copper and gold production profile and secures a longer mine life at Copper Mountain. Based on current mineral reserves, New Ingerbelle is projected to produce approximately 750,000 tonnes of copper, 900,000 ounces of gold and 5.5 million ounces of silver over the life of mine. Designed to access higher-grade mineralization, the expansion also features a stripping ratio approximately three times lower than current mining areas.

The groundbreaking comes shortly after the Government of British Columbia added New Ingerbelle to its list of priority resource projects, recognizing initiatives that support economic growth, responsible resource development and long-term value creation across the province. The New Ingerbelle expansion received key mining permits on February 19, 2026 from the British Columbia Major Mines Office ("MMO") following a robust review and consultation process. Throughout the permitting process, Hudbay proactively engaged with the MMO, local communities, the Upper Similkameen Indian Band ("USIB") and the Lower Similkameen Indian Band ("LSIB") to ensure transparency and collaborative oversight and to seek consensus, although, as previously disclosed, the LSIB subsequently submitted an application for judicial review of the regulatory decision to grant the New Ingerbelle permit amendment.

With key permits in place, Hudbay is advancing important infrastructure required for the expansion, including an access road, a bridge across the Similkameen river and an east haul road connecting New Ingerbelle to existing operations. Growth capital expenditures in British Columbia in 2026 are expected to increase by approximately $30 million to $115 million related to additional costs associated with infrastructure development at New Ingerbelle. Hudbay expects similar levels of growth capital investments in British Columbia in 2027 related to the continued infrastructure development at New Ingerbelle, which is expected to achieve first production in late 2028. The Company has also initiated a targeted drilling program at New Ingerbelle, focusing on upgrading existing inferred resources to reserves to further optimize and extend the mine life at Copper Mountain.

Peru Regulatory Approval Received to Further Increase Mill Throughput at Constancia

Hudbay received approval from the National Environmental Certification Service for Sustainable Investments in Peru to amend its environmental permit and further increase annual mill processing capacity at Constancia. The approval was received in late June and represented the fifth environmental permit amendment at Constancia. The amended permit increases the processing capacity of the Constancia mill to 34 million tonnes of ore per annum from the previously permitted 31 million tonnes. In March 2026, Hudbay received permit approval to increase mill throughput capacity to 31 million tonnes from 29.9 million tonnes per annum.

As part of the Company's continuous improvement efforts, the updated permit enables additional capacity to further optimize Constancia's operations and deliver strong copper production. Hudbay's efforts to increase mill throughput align with the Peru Ministry of Energy and Mines' regulatory framework, which permits operational flexibility to operate up to 10% above nominal daily capacity. Hudbay achieved total ore processed of 30.3 million tonnes and 31.9 million tonnes in 2025 and 2024, respectively. With this permit amendment, Hudbay is aligning its operational capacity to support the new level of 34 million tonnes per annum, while maintaining the standard operational flexibility to handle daily increases of up to 10% above permitted levels.

Large Exploration Drill Program Continues in Snow Lake

Hudbay continues to execute the largest exploration program in Snow Lake in the Company's history through extensive geophysical surveying and drilling campaigns as part of Hudbay's multi-pronged exploration strategy:

• Near-mine Exploration at Lalor and 1901 to Further Increase Near-term Production and Extend Mine Life - Near-mine exploration at the Lalor mine and the adjacent 1901 deposit continued to support near-term production growth and mine life extension. The exploration program will continue during the remainder of 2026 to potentially increase mineral reserves and resources and enable additional resource conversion. At the 1901 deposit, activities are focused on exploration and definition drilling, orebody access and establishing the critical infrastructure required to support full production beginning in late 2027. Exploration activities at 1901 will include step-out drilling to potentially extend the orebody, as well as infill drilling aimed at converting inferred mineral resources within the gold lenses to mineral reserves.

• Evaluating Significant Gold Production Potential from Past-Producing New Britannia mine - Acquired through the New Britannia mill acquisition in 2015, the past-producing New Britannia mine provides potential for significant incremental gold production in Snow Lake. The Company is developing an exploration plan to test down plunge extensions and underexplored areas between known deposits at the mine. Hudbay plans to conduct infill and expansion drilling at the 3 Zone, a satellite deposit to New Britannia, with three drills scheduled for later in 2026.

• Testing Regional Satellite Deposits to Utilize Available Processing Capacity and Increase Production - Hudbay's extensive regional land package includes an attractive portfolio of deposits in Snow Lake within trucking distance of the Snow Lake processing infrastructure, including the Talbot, Rail, Pen II, Watts, and WIM deposits. With available mill processing capacity at the Stall mill, the Company continues to progress exploration work across the region to define satellite deposits to potentially increase production and extend the life of the Snow Lake operations beyond 2041. During the second quarter of 2026, the infill drilling program at Talbot was completed as well as the geotechnical drilling required for PFS activities. The Company is also testing additional targets to expand the footprint of the deposit at depth. Hudbay intends to update Rockcliff's prior mineral resource estimate for Talbot using Hudbay's standard methods.

• Exploring Large Land Package for New Anchor Deposit to Significantly Extend Mine Life - A majority of the land claims acquired as part of the Rockcliff acquisition in 2023 have been untested by modern deep geophysics, which was the discovery method for the Lalor deposit. The large geophysics program underway consisting of surface electromagnetic surveys using cutting edge techniques that enable the team to detect targets at depths of almost 1,000 metres below surface. The planned 2026 geophysics program includes 600 kilometres of ground electromagnetic surveys and an extensive airborne geophysics survey.

Mason Project Commences Pre-feasibility Study Activities

The Mason project is a 100% owned greenfield copper deposit located in the historic Yerington District of Nevada and is one of the largest undeveloped copper porphyry deposits in North America. Hudbay views the Mason project as a long-term future development asset as part of the Company's pipeline of high-quality copper growth opportunities.

Hudbay completed a preliminary economic assessment on Mason in 2021 which contemplated a 27-year mine life with average annual copper production of approximately 140,000 tonnes over the first ten years of full production. The Company recently initiated PFS activities at Mason and expects to spend approximately $20 million in evaluation expenses at Mason for the remainder of 2026. The Mason PFS is expected to be completed in the second half of 2027.

Dividend Declared

A quarterly dividend of C$0.01 per share was declared on July 28, 2026. The dividend will be paid out on September 8, 2026 to shareholders of record as of close of business on September 25, 2026.

¹ Net debt and net debt to adjusted EBITDA are non-GAAP financial performance measures with no standardized definition under IFRS. For further information, please see discussion under the "Non-GAAP Financial Performance Measures" section of this MD&A.

PERU OPERATIONS REVIEW

		Three months ended			Six months ended
		Jun. 30, 2026	Mar. 31, 2026	Jun. 30, 2025	Jun. 30, 2026	Jun. 30, 2025
Constancia ore mined¹	tonnes	10,962,399	10,701,375	6,735,316	21,663,774	15,363,595
Copper	%	0.28	0.29	0.34	0.28	0.31
Gold	g/tonne	0.04	0.03	0.03	0.03	0.03
Silver	g/tonne	3.68	3.11	3.26	3.40	3.19
Molybdenum	%	0.01	0.01	0.02	0.01	0.02
Pampacancha ore mined^1,2	tonnes	-	-	762,172	-	1,151,361
Copper	%	-	-	0.26	-	0.32
Gold	g/tonne	-	-	0.24	-	0.25
Silver	g/tonne	-	-	4.59	-	4.28
Molybdenum	%	-	-	0.01	-	0.01
Total ore mined	tonnes	10,962,399	10,701,375	7,497,488	21,663,774	16,514,956
Strip ratio³		0.88	0.83	1.47	0.86	1.22
Ore milled	tonnes	7,827,509	8,163,847	7,559,047	15,991,356	15,673,071
Copper	%	0.30	0.31	0.34	0.31	0.32
Gold	g/tonne	0.04	0.06	0.05	0.05	0.05
Silver	g/tonne	3.75	3.09	3.58	3.41	3.39
Molybdenum	%	0.01	0.01	0.01	0.01	0.01
Copper concentrate	tonnes	90,500	93,704	94,813	184,204	186,984
Concentrate grade	% Cu	21.49	21.95	22.90	21.73	22.46
Copper recovery	%	82.0	81.5	84.5	81.7	84.6
Gold recovery	%	48.8	59.9	56.0	55.2	56.2
Silver recovery	%	59.9	65.4	63.5	62.4	64.7
Molybdenum recovery	%	39.9	36.0	38.7	37.8	37.1
Combined unit operating costs^4,5	$/tonne	14.06	11.61	13.59	12.82	12.29

¹Reported tonnes and grade for ore mined are estimates based on mine plan assumptions and may not reconcile fully to ore milled.

²Pampacancha has been depleted as of December 31, 2025.

³Strip ratio is calculated as waste mined divided by ore mined.

⁴Reflects combined mine, mill and general and administrative ("G&A") costs per tonne of ore milled. Reflects the deduction of expected capitalized stripping costs.

⁵ Combined unit costs is a non-GAAP financial performance measure with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-GAAP Financial Performance Measures" section of this MD&A.

Three months ended

Six months ended

Jun. 30,
2026

Mar. 31,
2026

Jun. 30,
2025

Jun. 30,
2026

Jun. 30,
2025

Contained metal in concentrate produced

Copper

tonnes

19,446

20,573

21,710

40,019

42,003

Gold

5,282

8,770

7,366

14,052

15,235

Silver

564,505

531,199

551,979

1,095,704

1,106,671

Molybdenum

tonnes

277

380

375

657

772

Payable metal sold

Copper

tonnes

15,755

21,056

21,418

36,811

44,308

Gold

4,042

15,162

9,721

19,204

24,083

Silver

418,640

676,119

616,578

1,094,759

1,331,233

Molybdenum

tonnes

298

375

427

673

875

Cost per pound of copper produced

Cash cost¹

$/lb

1.66

0.70

1.45

1.17

1.29

Sustaining cash cost¹

$/lb

2.71

1.43

2.63

2.05

2.29

¹ Cash cost and sustaining cash costs, net of by-product credits, per pound of copper produced are not recognized under IFRS. For more detail on these non-GAAP financial performance measures, please see the discussion under the "Non-GAAP Financial Performance Measures" section of this MD&A.

Overview

The Peru operations continued to demonstrate steady operating performance during the second quarter of 2026, with production and costs in line with full-year expectations following the depletion of Pampacancha at the end of 2025.

The Company continues to advance the installation of pebble crushers at Constancia to increase mill throughput rates starting in the third quarter of 2026, which will allow the mine to deliver steady annual copper production despite lower grades following the depletion of Pampacancha.

In June 2026, the Company received approval from the National Environmental Certification Service for Sustainable Investments in Perú ("SENACE") to amend its environmental permit and further increase annual mill processing capacity at Constancia. This represented the fifth environmental permit amendment at Constancia. The amended permit increases the processing capacity of the Constancia mill to 34 million tonnes of ore per annum from the previously permitted 31 million tonnes per annum. Previously, in March 2026, Hudbay received permit approval to increase mill throughput capacity to 31 million tonnes from 29.9 million tonnes per annum.

As part of the Company's continuous improvement efforts, the updated permit enables additional capacity to further optimize Constancia's operations and deliver strong copper production. Hudbay's efforts to increase mill throughput align with the Peru Ministry of Energy and Mines' regulatory framework, which provides operational flexibility to operate up to 10% above nominal daily capacity. Hudbay achieved total ore processed of 30.3 million tonnes and 31.9 million tonnes in 2025 and 2024, respectively. With this permit amendment, Hudbay is in the process of aligning its operational capacity to support the new level of 34 million tonnes per annum, while maintaining the standard operational flexibility to handle daily increases of up to 10% above permitted levels.

The environmental permit amendment also approves further optimization of the mine plan, extends the operational life of Constancia, and incorporates the implementation of additional infrastructure to improve tailings transport infrastructure and water management systems.

In April 2026, Constancia was recognized as the safest open pit operation in Peru during the local National Mining Safety Contest for its performance in 2025. This award reflects the Company's unwavering commitment to safety and validates Constancia's compliance with the highest operational safety and regulatory standards.

Mining Activities

Total material moved during the second quarter of 2026 was 23.9 million tonnes, 15% higher than the same period in 2025, primarily as a result of shorter hauling distances from mining exclusively within the Constancia pit compared with mining two pits in 2025. A new monthly record total volume of material moved was achieved in May 2026. In addition, Peru realized improved productivity from enhanced fleet efficiency and the implementation of haulage optimization strategies. Total ore mined during the quarter remained consistent with ore mined in the first quarter of 2026.

Year-to-date total material moved was 16% higher than the same period in 2025, while year-to-date ore mined increased by 31% compared to the prior year period, driven by the same structural and fleet efficiency improvements noted in the quarterly variance, as well as positive reconciliation obtaining ore instead of waste.

Milling Activities

Mill throughput levels averaged approximately 86,000 tonnes per day during the second quarter of 2026, a marginal decrease compared to the first quarter of 2026, primarily due to the scheduled semi-annual plant maintenance shutdown and the processing of more metallurgically complex ore during the second quarter of 2026. Milled copper grades decreased slightly compared to the first quarter of 2026 due to blending targets implemented to control contaminants in the concentrate. As expected, overall gold grades declined primarily due to the transition away from the higher-grade gold contributions from the Pampacancha stockpile. Compared to the second quarter of 2025, milled copper and gold grades decreased primarily due to mining exclusively within the Constancia pit, compared to a two-pit operation in the prior year period. Metal recoveries remained in line with expectations.

Ore milled during the first half of 2026 was higher than the comparable period in 2025, largely driven by plant mechanical availability at the plant. Milled copper and gold grades in the first half of 2026 were slightly lower than the same period in 2025 due to processing ore from the Constancia pit. Copper recoveries during the first half of 2026 averaged 82%, a 3% decline compared to the same year-to-date period, driven by a lower grades and a higher proportion of stockpile ore feed. Gold and silver recoveries during the first half of 2026 were 55% and 62%, respectively, representing a decrease compared to the same year-to-date period of 2% and 4%, respectively, but remained in line with Hudbay's metallurgical models.

Production and Sales Performance

During the second quarter of 2026, the Peru operations produced 19,446 tonnes of copper, 5,282 ounces of gold, 564,505 ounces of silver and 277 tonnes of molybdenum. Production of copper, gold and molybdenum was slightly lower compared to the first quarter of 2026, reflecting the planned semi-annual plant maintenance shutdown during the second quarter of 2026. Compared to the same period in 2025, production of copper and gold declined slightly, primarily as a result of lower mill recoveries associated with the processing of lower grade ore feed.

Year-to-date production of copper and gold during the first half of 2026 was 40,019 tonnes and 14,052 ounces, respectively, representing a decrease of 5% and 8%, respectively, compared to the same period in 2025, primarily due to lower recoveries that resulted from processing slightly lower head grades as more material was mined from the Constancia pit and reclaimed from stockpiles compared with the same period last year, which included material mined from Pampacancha.

Quantities of metal sold during the three and six months ended June 30, 2026 were in line with the variances noted above, but were further affected by higher finished goods concentrate inventory levels at the end of the second quarter of 2026, resulting in lower sales volumes. Sales volumes were impacted by a temporary build-up of concentrate inventory at the port caused by ocean swells that resulted in temporary port closures and delayed scheduled shipments. As a result, approximately 10,000 dry metric tonnes of copper concentrate sales were deferred to the first half of July.

*Copper equivalent production is calculated using the quarter average LME prices for each metal excluding molybdenum.

Cost Performance

Combined mine, mill and G&A unit operating cost in the second quarter of 2026 was $14.06 per tonne, which was 3% higher than the same period in 2025, primarily driven by higher fuel prices, partially offset by lower power costs related to a new power purchase agreement that came into effect on January 1, 2026, and additional tonnes of ore milled.

Combined mine, mill and G&A unit operating cost in the second quarter of 2026 increased by 21% compared to the first quarter of 2026, primarily due to higher fuel prices and a scheduled semi-annual plant shutdown in May 2026.

Combined mine, mill and G&A unit operating costs for the six months ended June 30, 2026 was $12.82 per tonne, a 4% increase compared to the same period in 2025, primarily due to higher diesel prices. This increase was partially offset by lower power prices and additional tonnes of ore milled.

Cash cost¹, net of by-product credits, in the second quarter of 2026 was $1.66 per pound of copper, a 14% increase compared to the same period in 2025. This variance was mainly due to lower net pounds of copper produced and higher fuel prices, which were partially offset by higher by-product credits and lower power costs given the new power purchase agreement. Cash cost¹, net of by-product credits increased by 137% compared to the first quarter of 2026, primarily due to lower gold by-product credits resulting from lower gold volumes given the completion of mining of the high gold content Pampacancha stockpile in the first quarter, higher fuel prices and the planned semi-annual plant maintenance shutdown in May 2026. This increase was partially offset by lower profit sharing. Despite the increase, cash cost for the quarter continued to outperform the low-end of the 2026 guidance range.

Year-to-date 2026 cash cost¹, net of by-product credits² were $1.17 per pound of copper, a decrease from $1.29 in the prior year period. This decrease was driven by higher gold and silver by-product credits, and the lower power price noted above, and was partially offset by a higher fuel price and higher profit sharing.

Sustaining cash cost¹, net of by-product credits, in the second quarter of 2026 was $2.71 per pound of copper, an increase of 3% compared to the same period in 2025 as a result of lower net pounds of copper produced and the cash costs variance explained above. This increase was partially offset by lower tailings management facility construction costs in 2026 and the timing of mine maintenance. During the second quarter of 2026, sustaining cash cost¹, net of by-product credits, per pound of copper increased by 90% compared to the first quarter of 2026, primarily due to the same reasons affecting cash costs above, as well as higher community agreement payments.

On a year-to-date basis, sustaining cash cost¹, net of by-products credits, was $2.05 per pound of copper, a 10% decrease when compared to the first half of 2025. This was primarily a result of lower cash cost as described above as well as the timing of mine equipment maintenance and lower tailing management facility construction costs in 2026 and was partially offset by lower pounds of copper produced and a higher cash payment for community agreements.

Peru Guidance Outlook

Three months ended

Six months ended

Guidance

Jun. 30, 2026

Jun. 30, 2025

Jun. 30, 2026

Jun. 30, 2025

Annual 2026

Contained metal in concentrate produced

Copper

tonnes

19,446

21,710

40,019

42,003

75,000 - 90,000

Gold

5,282

7,366

14,052

15,235

15,000 - 20,000

Silver

564,505

551,979

1,095,704

1,106,671

1,900,000 - 2,400,000

Molybdenum

tonnes

277

375

657

772

900 - 1,100

Cost per pound of copper produced

Cash cost¹

$/lb

1.66

1.45

1.17

1.29

1.70 - 2.10

¹ Cash cost, net of by-product credits, per pound of copper produced are not recognized under IFRS. For more detail on these non-GAAP financial performance measures, please see the discussion under the "Non-GAAP Financial Performance Measures" section of this MD&A.

²Refer to the "Outlook" section of this MD&A for more information.

Hudbay is on track to achieve its 2026 production guidance for all metals in Peru. Cash cost for the quarter outperformed the low-end of the 2026 guidance range as a result of strong operating cost performance and higher by-product prices, despite external cost pressures. Hudbay is well positioned to achieve the full year 2026 cash cost guidance range in Peru.

MANITOBA OPERATIONS REVIEW

		Three months ended			Six months ended
		Jun. 30, 2026	Mar. 31, 2026	Jun. 30, 2025	Jun. 30, 2026	Jun. 30, 2025
Total ore mined¹	tonnes	321,719	349,980	303,062	671,699	687,296
Gold	g/tonne	4.41	4.72	4.97	4.57	5.25
Copper	%	0.84	0.80	0.61	0.82	0.80
Zinc	%	2.25	2.10	2.46	2.17	2.44
Silver	g/tonne	28.33	26.22	29.94	27.23	30.67
New Britannia ore milled	tonnes	170,477	181,403	162,934	351,880	352,058
Gold	g/tonne	5.31	6.06	6.48	5.70	6.96
Copper	%	1.00	1.04	0.65	1.02	0.94
Zinc	%	0.97	1.09	1.01	1.03	1.01
Silver	g/tonne	29.73	22.75	30.29	26.13	31.93
Copper concentrate	tonnes	11,228	12,198	6,278	23,426	20,674
Concentrate grade	% Cu	13.82	14.07	14.73	13.95	14.24
Gold recovery²	%	90.5	90.4	89.4	90.4	89.9
Copper recovery	%	90.9	90.8	87.4	90.9	89.3
Silver recovery²	%	84.5	82.2	78.0	83.4	80.0
Contained metal in concentrate produced
Gold	oz	18,155	21,348	17,801	39,503	44,287
Copper	tonnes	1,553	1,716	926	3,269	2,945
Silver	oz	101,599	78,463	80,516	180,062	200,753
Metal in doré produced³
Gold	oz	11,051	12,626	15,379	23,677	30,490
Silver	oz	35,526	36,494	46,311	72,020	91,623
Stall ore milled	tonnes	148,037	178,981	144,204	327,018	359,490
Gold	g/tonne	3.30	3.26	3.19	3.28	3.60
Copper	%	0.66	0.53	0.56	0.59	0.68
Zinc	%	3.81	3.22	4.20	3.48	3.74
Silver	g/tonne	27.46	29.68	29.55	28.68	29.54
Copper concentrate	tonnes	4,683	4,831	3,854	9,514	10,562
Concentrate grade	% Cu	17.35	16.95	17.79	17.15	20.22
Zinc concentrate	tonnes	9,279	9,038	9,739	18,317	22,323
Concentrate grade	% Zn	51.31	50.51	52.68	50.92	51.05
Gold recovery	%	70.8	73.5	67.9	72.3	69.3
Copper recovery	%	83.7	85.9	84.7	84.8	87.1
Zinc recovery	%	84.5	79.3	84.8	81.9	84.7
Silver recovery	%	55.4	57.5	51.9	56.6	56.0
Contained metal in concentrate produced
Gold	oz	11,138	13,769	10,055	24,907	28,812
Copper	tonnes	813	819	686	1,632	2,136
Zinc	tonnes	4,760	4,565	5,130	9,325	11,395
Silver	oz	72,353	98,251	71,143	170,604	191,197

¹Reported tonnes and grade for ore mined are estimates based on mine plan assumptions and may not reconcile fully to ore milled. Total ore mined includes tonnes from Lalor and 1901.

²Gold and silver recovery includes total recovery from concentrate and doré.

³Doré includes sludge, slag and carbon fines.

Three months ended

Six months ended

Jun. 30, 2026

Mar. 31, 2026

Jun. 30, 2025

Jun. 30, 2026

Jun. 30, 2025

Total contained metal in concentrate and doré produced¹

Gold

40,344

47,743

43,235

88,087

103,589

Copper

tonnes

2,366

2,535

1,612

4,901

5,081

Zinc

tonnes

4,760

4,565

5,130

9,325

11,395

Silver

209,478

213,208

197,970

422,686

483,573

Payable metal sold in concentrate and doré²

Gold

47,066

45,274

46,932

92,340

102,697

Copper

tonnes

2,466

2,658

2,133

5,124

4,858

Zinc

tonnes

2,635

3,897

2,871

6,532

7,728

Silver

209,383

193,472

209,594

402,855

441,848

Unit Operating Costs³

Lalor

C$/tonne

186.93

165.99

153.08

176.02

147.55

New Britannia

C$/tonne

86.18

77.20

67.98

81.55

68.05

Stall

C$/tonne

53.26

46.42

51.53

49.52

42.21

Combined unit operating costs^4,5,6

C$/tonne

300

254

241

276

225

Cost per ounce of gold produced

Cash cost^6,7

$/oz

776

408

710

577

515

Sustaining cash cost⁶

$/oz

1,358

833

1,025

1,074

793

¹ Total metal reported in concentrate is prior to deductions associated with smelter terms and includes other secondary products.

² Includes other secondary products.

³ Reflects costs per tonne of ore mined/milled.

⁴ Reflects combined mine, mill and G&A costs per tonne of milled ore.

⁵ Excludes $3.2 million or C$14 per tonne of overhead costs incurred during temporary suspension during the three months ended June 30, 2025 and $3.2 million or C$6 per tonne during the six months ended June 30, 2025.

⁶ Combined unit costs, cash cost and sustaining cash cost, net of by-product credits, per ounce of gold produced are non-GAAP financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-GAAP Financial Performance Measures" section of this MD&A.

⁷ Excludes $3.2 million or $74 per ounce of overhead costs incurred during temporary suspension during the three months ended June 30, 2025 and $3.2 million or $31 per ounce during the six months ended June 30, 2025.

Overview

The Manitoba operations continued to execute its strategic initiatives during the second quarter of 2026, navigating short-term operational hurdles while positioning the business for an expected strong second half of the year. To address labour availability constraints, Hudbay engaged an experienced mining contractor to advance the 1901 deposit. This strategic decision has enabled the team to redeploy its skilled internal workforce to other critical development areas at Lalor. Hudbay has simultaneously increased internal capacity, onboarding over 100 new employees in 2026, who are currently undergoing upskilling to enhance long-term operational self-sufficiency in Manitoba.

While the Manitoba operations experienced minor production impacts from an unplanned hoist gearbox failure at Lalor in June, the hoist is now repaired and fully operational, and the team strategically prioritized high-value gold zones to maintain consistent feed for the New Britannia mill. These initiatives position the business to support higher production volumes and grades in the second half of 2026, which remains aligned with annual production guidance in Manitoba.

Hudbay's Mining Fundamentals Training program, in partnership with the Northern Manitoba Sector Council, achieved a 100% conversion rate in the second quarter, with all nine cohort graduates accepting full-time roles at Hudbay. Building on this success, the team have engaged the University College of the North to further refine the curriculum. A fifth cohort, which will include participants from local Indigenous communities, is scheduled to launch in the third quarter of 2026.

The Snow Lake operations advanced key sustaining capital environmental projects during the second quarter, including construction of a cyanide recycling initiative at the New Britannia mill and construction of a dam lift at the Anderson Tailings Impoundment Area. Both projects remain on schedule for completion by the end of 2026.

Mining Activities

Total ore mined in Manitoba in the second quarter of 2026 was higher compared to the same period in 2025, reflecting an improvement over the prior year period which was impacted by a temporary suspension in operations related to wildfire evacuation orders in 2025. Conversely, total ore mined was lower than the first quarter of 2026, primarily driven by reduced workforce availability, which limited effective utilization of equipment and workplaces. In the second quarter of 2026, gold grades decreased by 11% and 7% when compared to the same period in 2025 and to the first quarter of 2026, respectively, driven by planned mine sequencing.

The Lalor mine hoisted an average of approximately 3,500 tonnes of ore per day, strategically prioritizing gold zones to secure optimal feed for the New Britannia mill.

The 1901 deposit delivered approximately 7,600 tonnes of development ore in the quarter. Looking ahead, the plan is to continue to prioritize exploration and infill drilling, orebody access and critical infrastructure development as 1901 progresses toward full production in late 2027.

Total ore mined at Manitoba operations during the first half of 2026 was 2% lower than the same period in 2025, primarily driven by reduced worker hours, which was partially offset by the impact of wildfire related shutdowns in June 2025. Gold, zinc, and silver grades mined at Lalor during the first half of 2026 were 13%, 11%, and 11% lower, respectively, compared with the same period in 2025. Copper grades mined during the first half of 2026 were 2% higher than the same period in 2025.

Milling Activities

The Stall mill processed more ore in the second quarter of 2026 compared to the second quarter of 2025, and less ore than the first quarter of 2026. Ore processed in the current quarter was consistent with Lalor base metal production. The Stall mill achieved gold recoveries of 71% during the second quarter of 2026, higher than the comparable period in 2025, reflecting recovery focused initiatives.

Hudbay also initiated early works on installing new tailings lines between the two mills, which is expected to increase the pipeline capacity to enable higher throughput and leaching of gold-bearing material at New Britannia from base metal ore originally processed at Stall mill.

Production and Sales Performance

The Manitoba operations produced 40,344 ounces of gold, 2,366 tonnes of copper, 4,760 tonnes of zinc and 209,478 ounces of silver in the second quarter of 2026. Production of gold and zinc decreased compared to the second quarter of 2025 primarily due to lower gold and zinc grades partially offset by higher recoveries for gold. Production of copper and silver increased compared to the second quarter of 2025, driven by the higher mill throughput and higher copper recoveries. Compared to the first quarter of 2026, production of gold, copper and silver was lower, primarily due to lower tonnes milled, while zinc production was slightly higher.

Year-to-date production of gold and zinc in 2026 was lower than the comparative 2025 period as a result of lower mined grades, partially offset by higher mill throughputs. Conversely, year-to-date production of copper and silver were higher than the comparative 2025 period due to higher copper grades, while zinc was lower due to lower grades.

Manitoba sales volumes in the second quarter of 2026 reflect typical levels of inventory and the lower production across most metals. During the six months ended June 30, 2026, quantities sold for all metals were relatively in line with variances in production with the exception of copper sales, which were slightly higher compared to the same period in 2025.

Cost Performance

Combined mine, mill and G&A unit operating costs in the second quarter of 2026 were C$300 per tonne, an increase compared to the second quarter of 2025, primarily due to higher onsite costs partially offset by higher ore milled in the period. Combined unit cost increased when compared to the first quarter of 2026 as a result of marginally higher onsite costs and lower ore milled due to reduced workforce availability, limiting the effective utilization of equipment and workplaces, as well as the failure of a critical hoist gearbox motor at Lalor.

Cash cost⁴, net of by-product credits, in the second quarter of 2026 was $776 per ounce of gold. This represents an increase compared to the same period in 2025, primarily attributed to the impact of lower grades on gold production volumes and higher unit operating costs across mining, milling activities and G&A cost including profit sharing. These costs were partially offset by higher by-product credits resulting from higher metal prices. Cash cost¹, net of by-product credits increased by 90% compared to the first quarter of 2026, primarily due to lower gold production and the same factors impacting combined mine, mill and G&A unit operating costs. Despite the increase, cash cost was within the guidance range for 2026.

Sustaining cash cost⁴, net of by-product credits, in the second quarter of 2026 was $1,358 per ounce of gold, higher than the same period in 2025 and higher than the first quarter of 2026, primarily due to the same factors affecting cash costs along with higher sustaining capital. As reflected in the Company's annual guidance, sustaining capital expenditures are expected to be higher than 2025, in part due to 2026 investments to raise the dam at the Anderson Tailings Impoundment Area and the New Britannia mill cyanide recycling project.

Cash cost, net of by-product credits, during the six months ended June 30, 2026 was $577 per ounce of gold. These costs were 12% higher compared to the same period in 2025 primarily due to lower gold production and higher mining, milling and G&A costs, partially offset by higher by-product credits. Sustaining cash cost, net of by-product credits, for the six months ended June 30, 2026 was $1,074 per ounce of gold, an increase of 35% from the same period in 2025 primarily due to the same factors affecting cash cost noted above, together with higher sustaining capital expenditures compared to the prior year.

Manitoba Guidance Outlook

Three months ended

Six months ended

Guidance

Jun. 30,
2026

Jun. 30,
2025

Jun. 30,
2026

Jun. 30,
2025

Annual 2026

Total contained metal in concentrate and doré produced¹

Gold²

40,344

43,235

88,087

103,589

180,000 - 220,000

Copper

tonnes

2,366

1,612

4,901

5,081

10,000 - 13,000

Zinc

tonnes

4,760

5,130

9,325

11,395

16,000 - 21,000

Silver³

209,478

197,970

422,686

483,573

800,000 - 1,000,000

Cost per ounce of gold produced

Cash cost^4,5

$/oz

776

710

577

515

500 - 800

¹ Metal reported in concentrate is prior to deductions associated with smelter terms and includes other secondary products.

²Gold production guidance includes gold contained in concentrate produced and gold in doré and includes other secondary products.

³ Silver production guidance includes silver contained in concentrate produced and silver in doré and includes other secondary products.

⁴ Combined unit costs, cash cost per ounce of gold produced, net of by-product credits, are non-GAAP financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-GAAP Financial Performance Measures" section of this MD&A.

⁵ Excludes $3.2 million or $74 per ounce of overhead costs incurred during temporary suspension during the three months ended June 30, 2025 and $3.2 million or $31 per ounce during the six months ended June 30, 2025.

Production in the second half of 2026 is expected to be higher than the first half of 2026 due to grade sequencing and higher ore output from Lalor, as previously disclosed. Hudbay is on track to achieve its 2026 production guidance for all metals in Manitoba and is well positioned to achieve the 2026 cash cost guidance range in Manitoba.

BRITISH COLUMBIA OPERATIONS REVIEW

		Three months ended⁵			Six months ended⁵
		Jun. 30, 2026	Mar. 31, 2026	Jun. 30, 2025	Jun. 30, 2026	Jun. 30, 2025
Ore mined¹	tonnes	3,276,090	2,916,152	2,509,969	6,192,242	5,158,063
Strip ratio²		6.22	7.06	7.50	6.61	7.11
Ore milled	tonnes	3,616,083	3,078,342	2,900,008	6,694,425	5,660,994
Copper	%	0.23	0.20	0.28	0.22	0.31
Gold	g/tonne	0.08	0.08	0.09	0.08	0.09
Silver	g/tonne	0.88	0.67	0.97	0.78	1.12
Copper concentrate	tonnes	27,274	21,136	28,198	48,411	59,432
Concentrate grade	% Cu	23.7	22.8	23.5	23.3	23.3
Copper recovery	%	77.3	78.9	81.0	78.0	79.5
Gold recovery	%	62.9	64.7	68.2	63.8	65.7
Silver recovery	%	69.7	64.6	71.8	67.7	70.7
Combined unit operating costs^3,4	C$/tonne	25.52	25.23	24.51	25.39	25.12

¹Reported tonnes and grade for ore mined are estimates based on mine plan assumptions and may not reconcile fully to ore milled.

²Strip ratio is calculated as waste mined divided by ore mined.

³Reflects combined mine, mill and general and administrative ("G&A") costs per tonne of ore milled. Reflects the deduction of expected capitalized stripping costs.

⁴ Combined unit costs is a non-GAAP financial performance measure with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-GAAP Financial Performance Measures" section of this MD&A.

⁵ Copper Mountain mine results are stated at 100%. On April 30, 2025 Hudbay completed the acquisition of the remaining 25% interest in the Copper Mountain mine and now owns 100%.

Three months ended²

Six months ended²

Jun. 30, 2026

Mar. 31, 2026

Jun. 30, 2025

Jun. 30, 2026

Jun. 30, 2025

Contained metal in concentrate produced

Copper

tonnes

6,455

4,821

6,634

11,276

13,830

Gold

5,608

5,187

5,670

10,795

11,231

Silver

71,178

43,042

65,040

114,220

144,520

Payable metal sold

Copper

tonnes

5,559

5,830

6,803

11,389

12,956

Gold

5,158

6,126

5,813

11,284

10,778

Silver

46,467

53,460

67,988

99,927

128,047

Cost per pound of copper produced

Cash cost¹

$/lb

3.22

2.41

2.39

2.87

2.41

Sustaining cash cost¹

$/lb

6.23

7.81

5.18

6.91

4.69

¹ Cash cost and sustaining cash cost, net of by-product credits, per pound of copper produced are non-GAAP financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-GAAP Financial Performance Measures" section of this MD&A.

² Copper Mountain mine results are stated at 100%. On April 30, 2025 Hudbay completed the acquisition of the remaining 25% interest in the Copper Mountain mine and now owns 100%.

Overview

Hudbay continued to advance its multi-year optimization plan at Copper Mountain, achieving significant milestones in mining productivity, operational improvements and project execution in the second quarter of 2026. The British Columbia operations produced 6,455 tonnes of copper, 5,608 ounces of gold, and 71,178 ounces of silver in the second quarter of 2026, which is aligned with guidance and the planned mining sequence. The sustained focus on safe production was highlighted with the receipt of the 2025 John Ash Safety Award from the BC Ministry of Mining and Critical Minerals, recognizing Copper Mountain as the safest open pit mine in British Columbia in 2025.

The New Ingerbelle project achieved another major milestone in the second quarter of 2026 with its official groundbreaking ceremony on June 16, following its designation as a priority resource project by the British Columbia government. This expansion significantly enhances the long-term copper and gold production profile at Copper Mountain, supporting continuous operations and securing the asset's substantial economic benefits and employment baseline beyond 2040. The project is designed to access higher-grade mineralization while maximizing operational efficiency with a stripping ratio approximately three times lower than current mining areas. With key permits and refreshed First Nations participation agreements firmly in place, Hudbay is actively advancing critical infrastructure required to connect the New Ingerbelle pit expansion on the west side of the Similkameen River to existing operations on the east side. Key infrastructure within the project scope includes the construction of the west access road, a clear-span bridge across the Similkameen River, and the development of the east haul road. The project is currently on schedule with significant progress achieved on all project components. Concurrently, a targeted drilling program is underway at New Ingerbelle to upgrade inferred resources to higher confidence levels, expand resources, and further optimize the future mine plan. This program is 71% complete and is scheduled for completion in the fourth quarter of 2026.

Following the execution of refreshed participation agreements with the USIB and the LSIB earlier in the year, the Joint Implementation Committee and the Joint Technical Committee for the New Ingerbelle project were established in the second quarter of 2026. These committees are instrumental in safeguarding the environment and building transparency and constructive relationships with the Bands.

On March 23, 2026, the LSIB submitted an application for judicial review of the regulatory decision by the Province of British Columbia to grant the New Ingerbelle permit amendment. Hudbay remains confident in the integrity and robustness of the regulatory process that led to the issuance of the permit amendment and Hudbay believes the court will uphold the decision. Hudbay is collaborating with the Province of British Columbia to prepare for a court hearing expected later in 2026. While this review process is underway, Hudbay remains committed to working with the LSIB in a respectful and constructive manner to try to resolve the LSIB's concerns through the mechanisms that were agreed to by the parties in the Participation Agreement.

Mining Activities

Mining activities reached a record total material movement of approximately 30.1 million tonnes in the second quarter of 2026, driven by an optimized mining sequence and improved operational performance, while self-performing the construction of the east haul road for the New Ingerbelle project. As part of the accelerated stripping program, these production efficiencies resulted in a record daily average mining rate of 331,000 tonnes per day, ahead of budget. This ramp-up was supported by the successful commissioning of a new production shovel in April 2026.

Total ore mined at Copper Mountain in the second quarter of 2026 was 3.3 million tonnes, an increase of 31% and 12% compared to the second quarter of 2025 and first quarter of 2026, respectively. During the second quarter of 2026, blending initiatives from the main pit maintained stable ore feed to the mill, allowing the operation to prioritize waste stripping activities to expose higher-value mining fronts in the future. The mine is now positioned favourably to unlock high-grade copper from the main pit in late 2026, and more specifically in 2027 and 2028.

Total ore mined at Copper Mountain during the six months ended June 30, 2026 was 20% higher than the same period in 2025, driven by an optimized mining sequence, improved operational performance, and the accelerated stripping program as described above. In comparison, ore mined during the first half of 2026 had lower copper grades than the same period in 2025, primarily due to mine plan sequencing and mining activities during the first half of 2025 were deeper in the deposit where copper grades were higher.

Milling Activities

Mill performance continues to demonstrate improvement following the optimization efforts initiated in 2025. The second semi-autogenous grinding (SAG) mill delivered increased throughput in the quarter, reaching commercial production in May and averaging 12,000 tonnes per day thereafter. Throughput continues to ramp up, with individual days exceeding 20,000 tonnes per day in late June and into July.

The primary SAG mill was temporarily shut down on June 26, 2026 and will be offline until the end of July to complete the feed end head maintenance program. The replacement is tracking on schedule and will remove the constraints previously in place due to the localized damage to the feed end head that occurred in September 2025. While repairs are underway on the primary SAG mill, the second SAG continues to operate. Total mill throughput is expected to ramp up to 50,000 tonnes per day in the second half of 2026, once the primary SAG mill resumes operation.

Despite the operating constraints on the primary SAG, the mill processed 3.6 million tonnes of ore during the second quarter of 2026, an increase of 25% and 17% compared to the same period in 2025 and the first quarter of 2026, respectively. Milling throughput benefitted from improved operating parameters from the second SAG mill and the temporary conveyor system trial in place to divert crushed pebbles from the primary SAG to the second SAG. Based on the successful trial, a more permanent system is being constructed and is scheduled to be commissioned by the fourth quarter.

Milled copper grades during the second quarter of 2026 were 18% lower than the same period in 2025, as the prior year period benefited from higher grade ore mined from grade sequencing. Compared to the first quarter of 2026, copper grades were higher, driven by a greater proportion of ore feed mined from a higher-grade phase in the second quarter of 2026. Copper and gold recoveries during the quarter declined to 77% and 63%, respectively. This decline resulted from the ramp-up of mill throughput during the second quarter which revealed a grinding constraint in the ball mills, resulting in increased grind size and lower overall recoveries, compared to the first quarter of 2026. Several grinding initiatives are underway, alongside flotation advanced process controls to improve recoveries.

Milled copper grades during the first half of 2026 were lower than the same period in 2025 as the prior year period benefited from higher-grade ore contributions from the main pit, resulting in stronger metallurgical performance. Year-to-date 2026 copper and gold recoveries were 78% and 64%, respectively, representing a decline from the comparable period in 2025. This decline was a result of lower average head grades combined with a coarser grind size, which resulted from higher SAG mill throughput and the ball mill circuit operating under constraints.

The mill remains on track to achieve its permitted capacity of 50,000 tonnes per day in the second half of 2026, supported by improved throughput performance from the second SAG mill and the removal of the constraints previously in place on the primary SAG by replacing the feed end head.

Production and Sales Performance

During the second quarter of 2026, the British Columbia operations produced 6,455 tonnes of copper, 5,608 ounces of gold and 71,178 ounces of silver. Copper and gold production were lower than the second quarter of 2025, primarily due to lower mined grades, partially offset by higher throughput. Compared to the first quarter of 2026, production of all metals increased as a result of higher ore mined, improved grades and higher throughput.

During the first half of 2026, production of copper, gold and silver was 11,276 tonnes, 10,795 ounces and 114,220 ounces, respectively. Year-to-date production of all metals was lower than the same period in 2025 as a result of lower mined grades and recoveries, partially offset by higher mill throughput.

Sales volumes for all metals in the second quarter of 2026 were lower than the corresponding period in 2025, primarily driven by same factors impacting production during this period. Compared to the first quarter of 2026, copper sales volumes were consistent during the second quarter of 2026.

Year-to-date sales quantity changes compared to the same period in 2025 reflect the changes in production during the periods.

*Copper equivalent production is calculated using the quarter average LME prices for each metal. Copper Mountain mine production is stated at 100%. On April 30, 2025 Hudbay completed the acquisition of the remaining 25% interest in the Copper Mountain mine and now owns 100%.

Cost Performance

Combined mine, mill and G&A unit operating costs in the second quarter of 2026 were C$25.52 per tonne milled, higher than the second quarter of 2025. This increase was primarily due to higher mining, milling and G&A costs, driven by higher energy and consumable costs, partially offset by higher milled throughput. Combined unit operating costs increased marginally compared to the first quarter of 2026, primarily driven by higher mining and G&A, partially offset by lower milling costs and higher milled throughput.

Combined mine, mill and G&A unit operating costs during the six months ended June 30, 2026 were C$25.39 per tonne milled versus C$25.12 per tonne milled in the first half of 2025 primarily due to the same factors affecting the quarterly variance.

Cash cost¹ and sustaining cash cost¹, net of by-product credits, were $3.22 and $6.23, respectively, per pound of copper in the second quarter of 2026. Cash cost¹ was higher than the first quarter of 2026 primarily as a result of higher mining costs, less deferred stripping and lower by-product credits, partially offset by higher copper production. The increase in mill availability in the second quarter of 2026 allowed for higher mill throughput and enhanced operational efficiencies. Compared to the second quarter of 2025, cash cost was higher primarily due to higher mining, milling and G&A costs. Sustaining cash cost¹was higher than the second quarter of 2025 primarily due to the same factors affecting cash cost, together with increased sustaining capital and higher royalties.

Cash cost and sustaining cash cost per pound of copper produced, net of by-product credits, during the six months ended June 30, 2026 were $2.87 and $6.91, respectively. Variances with the same period last year were for largely the same factors affecting the quarterly variances.

British Columbia Guidance Outlook

Three months ended²

Six months ended²

Guidance

Jun. 30, 2026

Jun. 30, 2025

Jun. 30, 2026

Jun. 30, 2025

Annual 2026

Contained metal in concentrate produced

Copper

tonnes

6,455

6,634

11,276

13,830

25,000 - 35,000

Gold

5,608

5,670

10,795

11,231

22,000 - 32,000

Silver

71,178

65,040

114,220

144,520

200,000 - 290,000

Cost per pound of copper produced

Cash cost¹

$/lb

3.22

2.39

2.87

2.41

1.50 - 2.50

¹ Cash cost and sustaining cash cost, net of by-product credits, per pound of copper produced is a non-GAAP financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-GAAP Financial Performance Measures" section of this MD&A.

² Copper Mountain mine results are stated at 100%. On April 30, 2025 Hudbay completed the acquisition of the remaining 25% interest in the Copper Mountain mine and now owns 100%.

Hudbay is on track to achieve its 2026 production guidance for all metals in British Columbia and continues to expect higher production in the second half of the year as the mill improvement projects take effect. Although second quarter cash cost was above the 2026 guidance range due to external cost pressures, Hudbay expects to achieve the full year 2026 cash cost guidance range in British Columbia.

FINANCIAL REVIEW

Financial Results

In the second quarter of 2026, Hudbay recorded net earnings attributable to owners of $137.4 million compared to the net earnings on the same basis of $117.7 million in the second quarter of 2025, representing an increase in net earnings attributable to owners of $19.7 million. Year-to-date in 2026, Hudbay recorded net earnings attributable to owners of $327.8 million compared to net earnings on the same basis of $218.1 million for the same period in 2025, representing an increase in earnings attributable to owners of $109.7 million.

The following table provides further details on the makeup of this variance:

(in $ millions)	Three months ended June 30, 2026		Six months ended June 30, 2026
Increase (decrease) in components of earnings:
Revenues	94.9		257.3
Cost of sales
Mine operating costs	(10.0	)	(43.9	)
Depreciation and amortization	7.6		15.8
Selling and administrative expenses	0.8		(19.9	)
Exploration expenses	(9.8	)	(12.1	)
Other operating expenses	2.4		(2.5	)
Re-evaluation adjustment - environmental obligation	(19.3	)	(8.6	)
Other (income) expense	20.7		68.9
Tax expense	(63.9	)	(139.3	)
Increase in net earnings for the period	23.4		115.7
Change in non-controlling interest	(3.7	)	(6.0	)
Increase in net earnings attributable to owners for the period	19.7		109.7

Revenue

Revenue for the second quarter of 2026 was $631.3 million, $94.9 million higher than the same period in 2025, primarily due to stronger metal prices, lower treatment and refining charges, partially offset by lower sales volume of all metals.

Revenue during the six months ended June 30, 2026 was $1,388.6 million, $257.3 million higher than in 2025, as a result of the same factors impacting the second quarter of 2026.

While a majority of revenues continue to be from copper, gold represented a significant portion of total revenues at 38% and 39% for the three months and six months ended June 30, 2026, respectively. This is as a result of exposure to higher gold prices.

The following table provides further details on these variances:

(in $ millions)	Three months ended June 30, 2026		Six months ended June 30, 2026

Metals prices¹
Higher copper prices	92.4		179.1
Higher gold prices	66.2		163.9
Higher zinc prices	2.5		3.7
Higher silver prices	17.7		37.2
Sales volumes
Lower copper sales volumes	(63.3	)	(85.9	)
Lower gold sales volumes	(19.4	)	(45.1	)
Lower zinc sales volumes	(0.6	)	(3.2	)
Lower silver sales volumes	(5.7	)	(7.9	)
Other
Molybdenum and other volume and pricing differences	1.7		11.2
Variable consideration adjustments	-		(10.0	)
Effect of lower treatment and refining charges	3.4		14.3
Increase in revenue in 2026 compared to 2025	94.9		257.3

¹ See discussion below for further information regarding metals prices.

²Copper Mountain mine results are stated at 100%

Hudbay's revenue by significant product type is summarized below:

	Three months ended						Six months ended

(in $ millions)	Jun. 30, 2026		Mar. 31, 2026		Jun. 30, 2025		Jun. 30, 2026		Jun. 30, 2025
Copper	333.8		380.1		297.1		713.9		599.4
Gold	262.4		289.6		189.2		552.0		383.4
Zinc	9.6		11.9		7.1		21.5		21.4
Silver	34.1		32.4		13.9		66.5		28.2
Molybdenum	18.4		20.6		19.1		39.0		40.0
Other metals	0.1		4.9		-		5.0		(0.2	)
Revenue from contracts	658.4		739.5		526.4		1,397.9		1,072.2
Amortization of deferred revenue - gold	2.5		9.1		5.9		11.6		14.3
Amortization of deferred revenue - silver	7.0		10.5		9.5		17.5		20.5
Amortization of deferred revenue - variable consideration adjustments - prior periods	-		(0.1	)	-		(0.1	)	9.9
Pricing and volume adjustments¹	(36.7	)	1.4		(2.1	)	(35.3	)	31.7
Treatment and refining charges	0.1		(3.1	)	(3.3	)	(3.0	)	(17.3	)
Revenue	631.3		757.3		536.4		1,388.6		1,131.3

¹Pricing and volume adjustments represents mark-to-market adjustments on provisionally prices sales, realized and unrealized changes to fair value for non-hedge derivative contracts (QP hedges) and adjustments to originally invoiced weights and assays.

For further detail on variable consideration adjustments, refer to note 18 of Hudbay's consolidated interim financial statements.

Realized sales prices

This measure is intended to enable management and investors to understand the average realized price of metals sold to third parties in each reporting period. The average realized price per unit sold does not have any standardized meaning prescribed by IFRS, is unlikely to be comparable to similar measures presented by other issuers and should not be considered in isolation or a substitute for measures of performance prepared in accordance with IFRS.

For sales of copper, zinc, gold and silver, Hudbay may enter into non-hedge derivatives ("QP hedges") which are intended to manage the provisional pricing risk arising from quotational period terms in concentrate sales agreements. The gains and losses on QP hedges are included in the calculation of realized prices. Hudbay expects that gains and losses on QP hedges will offset provisional pricing adjustments on concentrate sales contracts.

Hudbay's realized prices for the three months ended June 30, 2026 and 2025 and March 31, 2026 and six months ended June 30, 2026 and 2025, respectively, are summarized below:

Realized prices¹ for the

Three months ended

Six months ended

Prices

LME QTD
2026²

Jun. 30,
2026

Mar. 31,
2026

Jun. 30,
2025

LME YTD
2026²

Jun. 30,
2026

Jun. 30,
2025

Copper

$/lb

6.05

6.13

5.81

4.36

5.94

5.96

4.43

Gold³

$/oz

4,508

4,312

4,468

3,135

4,691

4,396

3,062

Zinc

$/lb

1.58

1.44

1.15

1.50

1.24

Silver³

$/oz

52.48

47.02

26.17

49.33

26.04

¹Realized prices exclude refining and treatment charges and are on the sale of finished metal or metal in concentrate. Realized prices include the effect of provisional pricing adjustments on prior period sales.

² London Metal Exchange average for Cash copper and zinc prices.

³Sales of gold and silver from Constancia mine are subject to Hudbay's precious metals stream agreement with Wheaton, pursuant to which Hudbay recognizes deferred revenue for precious metals deliveries and also receive cash payments. Stream sales are included within realized prices and their respective deferred revenue and cash payment rates can be found on page 33 of this MD&A.

In addition to QP hedges, the Company may periodically undertake metal price hedging in accordance with Board approved policies to achieve strategic objectives, including locking in favourable metal prices to ensure minimum cash flows during or after the construction of a mine or during a period of reduced liquidity due to large capital investments, to manage cash flows at shorter life or higher cost operations or as part of a financing arrangement. The realized prices, denoted in the table above, exclude the impact of derivative mark-to-market gains and losses on these non-QP hedges, which are included in change in fair value of financial instruments in Hudbay's condensed consolidated interim statements of income.

Hudbay entered into forward copper sales and zero copper cost collar hedges during the first quarter of 2026 that cover approximately 35% of Copper Mountain's expected 2026 production.

As of June 30, 2026, Hudbay had the following non-QP hedges outstanding:

• Forward sales contracts for a total of 6.6 million pounds of copper production over the period of July 2026 to April 2027 at an average price of $6.03 per pound; and

• Zero-cost collar program for 13.2 million pounds of copper production over the period of July 2026 to April 2027 at an average floor price of $5.76 per pound and an average cap price of $6.36 per pound.

The following tables provide a reconciliation of average realized price per unit sold, by metal, to revenues as shown in the consolidated interim financial statements.

Three months ended June 30, 2026
(in $ millions except for realized price and payable metal sold) ¹	Copper		Gold		Zinc		Silver		Molybdenum	Other	Total
Revenue from contracts²	333.8		262.4		9.6		34.1		18.4	0.1	658.4
Amortization of deferred revenue	-		2.5		-		7.0		-	-	9.5
Pricing and volume adjustments ³	(12.3	)	(22.3	)	(0.4	)	(5.7	)	4.0	-	(36.7	)
Revenue, including mark-to-market on QP hedges ⁴	321.5		242.6		9.2		35.4		22.4	0.1	631.2
Realized non-QP derivative mark-to-market	(0.1	)	-		-		-		-	-	(0.1	)
By-product credits ⁵	321.4		242.6		9.2		35.4		22.4	0.1	631.1
Payable metal in concentrate and doré sold⁶	23,780		56,266		2,635		674,490		298	-	-
Realized price⁷	6.13		4,312		1.58		52.48		-	-	-
Realized price, including realized non-QP derivative ⁷	6.13		4,312		1.58		52.48		-	-	-
Three months ended March 31, 2026
Revenue from contracts ²	380.1		289.6		11.9		32.4		20.6	4.9	739.5
Amortization of deferred revenue	-		9.1		-		10.5		-	-	19.6
Pricing and volume adjustments ³	(1.7	)	(1.3	)	0.5		0.5		3.4	-	1.4
Revenue, including mark-to-market on QP hedges ⁴	378.4		297.4		12.4		43.4		24.0	4.9	760.5
Realized non-QP derivative mark-to-market	-		-		-		-		-	-	-
By-product credits ⁵	378.4		297.4		12.4		43.4		24.0	4.9	760.5
Payable metal in concentrate and doré sold⁶	29,544		66,562		3,897		923,051		375	-	-
Realized price ⁷	5.81		4,468		1.44		47.02		-	-	-
Realized price, including realized non-QP derivative ⁷	5.81		4,468		1.44		47.02
Three months ended June 30, 2025
Revenue from contracts ²	297.1		189.2		7.1		13.9		19.1	-	526.4
Amortization of deferred revenue	-		5.9		-		9.5		-	-	15.4
Pricing and volume adjustments ³	(4.7	)	0.7		0.2		-		1.7	-	(2.1	)
Revenue, including mark-to-market on QP hedges ⁴	292.4		195.8		7.3		23.4		20.8	-	539.7
Realized non-QP derivative mark-to-market ⁵	(0.4	)	-		-		-		-	-	(0.4	)
By-product credits⁴	292.0		195.8		7.3		23.4		20.8	-	539.3
Payable metal in concentrate and doré sold⁶	30,354		62,466		2,871		894,160		427	-	-
Realized price⁷	4.36		3,135		1.15		26.17		-	-	-
Realized price, including realized non-QP derivative ⁷	4.36		3,135		1.15		26.17

¹Average realized price per unit sold may not calculate based on amounts presented in this table due to rounding.

² As per IFRS Accounting Standards.

³Pricing and volume adjustments represents mark-to-market adjustments on provisionally priced sales, realized and unrealized changes to fair value for QP hedge derivative contracts and adjustments to originally invoiced weights and assays.

⁴ Revenue, including mark-to-market on QP hedges is used in the calculation of realized price.

⁵ By-product credits subtotal is used in the calculated of cash cost per pound of copper and ounce of gold produced, net of by-product credits. Cash cost per pound of copper and per ounce of gold produced, net of by-product credits, are non-GAAP financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-GAAP Financial Performance Measures" section of this MD&A.

⁶Copper and zinc shown in metric tonnes and gold and silver shown in ounces.

⁷ Realized price for copper and zinc in $/lb and realized price for gold and silver in $/oz.

Six months ended June 30, 2026
(in $ millions except for realized price and payable metal sold) ¹	Copper		Gold		Zinc		Silver		Molybdenum	Other		Total
Revenue from contracts ²	713.9		552.0		21.5		66.5		39.0	5.0		1,397.9
Amortization of deferred revenue	-		11.6		-		17.5		-	-		29.1
Pricing and volume adjustments ³	(14.0	)	(23.6	)	0.1		(5.2	)	7.4	-		(35.3	)
Revenue, including mark-to-market on QP hedges ⁴	699.9		540.0		21.6		78.8		46.4	5.0		1,391.7
Realized non-QP derivative mark-to-market	(0.1	)	-		-		-		-	-		(0.1	)
By-product credits ⁵	699.8		540.0		21.6		78.8		46.4	5.0		1,391.6
Payable metal in concentrate and doré sold⁶	53,324		122,828		6,532		1,597,541		673	-		-
Realized price ⁷	5.96		4,396		1.50		49.33		-	-		-
Realized price, including realized non-QP derivative ⁷	5.95		4,396		1.50		49.33		-	-		-
Six months ended June 30, 2025
(in $ millions except for realized price and payable metal sold) ¹	Copper		Gold		Zinc		Silver		Molybdenum	Other		Total
Revenue from contracts ²	599.4		383.4		21.4		28.2		40.0	(0.2	)	1,072.2
Amortization of deferred revenue	-		14.3		-		20.5		-	-		34.8
Pricing and volume adjustments ³	7.3		23.5		(0.3	)	0.8		0.4	-		31.7
Revenue, including mark-to-market on QP hedges ⁴	606.7		421.2		21.1		49.5		40.4	(0.2	)	1,138.7
Realized non-QP derivative mark-to-market	(2.3	)	-		-		-		-	-		(2.3	)
By-product credits ⁵	604.4		421.2		21.1		49.5		40.4	(0.2	)	1,136.4
Payable metal in concentrate and doré sold⁶	62,122		137,558		7,728		1,901,128		-	-		-
Realized price ⁷	4.43		3,062		1.24		26.04		-	-		-
Realized price, including realized non-QP derivative ⁷	4.41		3,062		1.24		26.04		-	-		-

¹Average realized price per unit sold may not calculate based on amounts presented in this table due to rounding.

² As per consolidated interim financial statements.

⁴ Revenue, including mark-to-market on QP hedges is used in the calculation of realized price.

⁶Copper and zinc shown in metric tonnes and gold and silver shown in ounces.

⁷ Realized price for copper and zinc in $/lb and realized price for gold and silver in $/oz.

The price, quantity and mix of metals sold affect Hudbay's revenue, operating cash flow and gross profit. Revenue from metals sales can vary from quarter to quarter due to production levels, shipping volumes and transfer of risk and title to customers.

Precious metals - stream sales and realized price breakdown

The following table shows a breakdown of realized prices for precious metals inclusive of stream and offtaker revenue. It further identifies the components of the realized price for stream revenues between the amortized drawdown rate and cash payment rate.

(in $ millions except for realized price and payable metal sold)

Gold

Silver

Three months ended

Six months ended

Three months ended

Six months ended

Revenue

Jun. 30,
2026

Jun. 30,
2025

Jun. 30,
2026

Jun. 30,
2025

Jun. 30,
2026

Jun. 30,
2025

Jun. 30,
2026

Jun. 30,
2025

Stream

3.8

8.8

17.5

21.4

10.0

13.3

24.7

28.9

Offtaker

238.8

187.0

522.5

399.8

25.4

10.1

54.1

20.6

Revenue, including mark-to-market on QP hedges ³

242.6

195.8

540.0

421.2

35.4

23.4

78.8

49.5

Payable metal sold

Stream

2,990

6,827

13,876

16,615

452,847

624,787

1,127,132

1,354,674

Offtaker

53,276

55,639

108,952

120,943

221,643

269,373

470,409

546,454

Total payable metal sold

56,266

62,466

122,828

137,558

674,490

894,160

1,597,541

1,901,128

Deferred revenue drawdown rate¹

$/oz

833

860

833

860

15.56

15.06

15.56

15.06

Cash rate²

$/oz

429

425

429

425

6.33

6.26

6.33

6.26

Stream realized price

$/oz

1,262

1,285

1,262

1,285

21.89

21.32

21.89

21.32

Offtaker realized price

$/oz

4,482

3,361

4,796

3,306

114.60

37.49

115.01

37.70

Realized price

$/oz

4,312

3,135

4,396

3,062

52.48

26.17

49.33

26.04

¹Deferred revenue drawdown rates for gold and silver do not include variable consideration adjustments.

² The gold and silver cash rate for Peru increased by 1% from $400/oz and $5.90/oz effective August 4, 2019. Subsequently every year, on August 4, the cash rate will increase by 1% compounded.

³ Revenue, including mark-to-market on QP hedges is used in the calculation of realized price.

Subsequent to the variable consideration adjustment recorded on January 1, 2026, the deferred revenue amortization is recorded in Peru at $833 per ounce gold and $15.56 per ounce silver (June 30, 2025 - $860 per ounce gold and $15.06 per ounce silver).

Cost of Sales

Hudbay's detailed cost of sales is summarized as follows:

(in $ millions)	Three months ended					Six months ended
(in $ millions)	Jun. 30, 2026		Mar. 31, 2026		Jun. 30, 2025	Jun. 30, 2026		Jun. 30, 2025
Peru
Mining	42.2		34.5		28.1	76.7		59.1
Milling	50.9		43.4		57.8	94.3		102.2
Changes in product inventory	(20.3	)	7.6		4.0	(12.7	)	17.8
Depreciation and amortization	45.4		61.4		56.0	106.8		124.2
G&A	25.6		33.7		23.4	59.3		46.0
Inventory adjustments	-		-		1.1	-		1.5
Freight, royalties and other charges	14.0		16.0		13.4	30.0		29.7
Total Peru cost of sales	157.8		196.6		183.8	354.4		380.5
Manitoba
Mining	43.5		42.3		33.5	85.8		71.8
Milling	16.3		16.3		13.4	32.6		27.8
Changes in product inventory	5.6		(5.9	)	3.8	(0.3	)	2.8
Depreciation and amortization	21.2		20.0		23.6	41.2		47.5
Overhead costs incurred during Manitoba temporary suspension (cash)	-		-		3.2	-		3.2
Inventory adjustments	0.9		-		1.0	0.9		1.0
G&A	19.3		21.8		14.3	41.1		29.4
Freight, royalties and other charges	5.3		5.7		5.1	11.0		10.8
Total Manitoba cost of sales	112.1		100.2		97.9	212.3		194.3
British Columbia¹
Mining	31.3		16.2		24.2	47.5		46.1
Milling	27.2		31.5		21.4	58.7		43.2
Changes in product inventory	(2.6	)	11.3		3.6	8.7		2.8
Depreciation and amortization	22.2		18.5		16.8	40.7		32.8
G&A	8.5		9.0		6.3	17.5		12.9
Inventory adjustments	-		-		1.4	-		2.2
Freight, royalties and other charges	5.8		6.0		4.5	11.8		8.7
Total British Columbia cost of sales	92.4		92.5		78.2	184.9		148.7
Cost of sales	362.3		389.3		359.9	751.6		723.5

¹ Copper Mountain mine results are stated at 100%.

Total cost of sales for the second quarter of 2026 was $362.3 million, reflecting an increase of $2.4 million compared to the second quarter of 2025.

Peru cost of sales during the second quarter of 2026 decreased by $26.0 million compared to the same period in 2025, primarily driven by the build-up of finished concentrate inventory. The build-up of inventory at the port was due to ocean swell-related closures, as well as an increase in the ore stockpile, which subsequently led to lower depreciation being recognized during the quarter. Additionally, milling costs were lower primarily as a result of lower power prices compared to the same period last year once the new power purchase agreement came into effect on January 1, 2026. These decreases were partially offset by higher mining costs resulting from higher diesel prices and increased contractor services as well as higher G&A costs driven by increased employee profit sharing. Peru cost of sales during the second quarter of 2026 decreased by $38.8 million compared to the first quarter of 2026, primarily driven by the same factors mentioned above.

Manitoba cost of sales during the second quarter of 2026 increased by $14.2 million compared to the same period in 2025, primarily driven by higher mining costs as a result of increased development, direct mining, and fuel costs. Milling costs also increased, reflecting fewer operational down days compared to the prior year period, which was impacted by a wildfire-related evacuation order. Additionally, the increase was a result of higher change in inventory costs and an increase in G&A costs, resulting from higher employee profit sharing. Manitoba cost of sales during the second quarter of 2026 increased by $11.9 million compared to the first quarter of 2026, primarily driven by a higher change in product inventory.

British Columbia cost of sales during the second quarter of 2026 increased by $14.2 million compared to the same period in 2025, primarily driven by higher mining costs resulting from elevated fuel prices and the timing of equipment maintenance, as well as higher milling costs driven by increased throughput, which led to higher power costs and consumables usage. Depreciation was also higher due to the acquisition of high valued capital assets that commenced depreciation during the period. These increases were partially offset by lower change in product inventory and fewer inventory adjustments. British Columbia cost of sales during the second quarter of 2026 decreased by $0.1 million compared to the first quarter of 2026, primarily driven by a build-up of product inventory. This decrease was partially offset by higher mining costs resulting from elevated fuel prices and the timing of equipment maintenance.

Total cost of sales for the six months ended June 30, 2026 was $751.6 million, remaining relatively consistent with the comparable period, reflecting an increase of $28.1 million.

Peru cost of sales decreased by $26.1 million for the six months ended June 30, 2026, compared to the same period of 2025 primarily due to the same factors mentioned above. Manitoba cost of sales increased by $18.0 million primarily due to higher mining, milling, and G&A partially offset by lower change in product inventory and depreciation. British Columbia cost of sales increased by $36.2 million primarily driven by the same factors mentioned in the quarterly variance.

For details on unit operating costs, refer to the respective tables in the "Operations Review" section of this MD&A.

For the second quarter of 2026, other significant variances in expenses, compared to the same period in 2025, include the following:

- Re-evaluation DRO adjustment gain decreased by $19.3 million due to the relative revaluation of the environmental reclamation provision on Hudbay's Manitoba non-producing sites from changes in long-term risk-free discount and inflation rates. Given the long term nature of the reclamation cash flows, the related environmental reclamation provision is highly sensitive to changes in inflation and long-term-risk free discount rates, and, as such, Hudbay may continue to experience significant quarterly environmental reclamation revaluations.

- Other operating expenses decreased by $2.4 million, primarily due to a gain of $11.5 million from business interruption insurance proceeds in Manitoba from the temporary suspension of operations related to the wildfire evacuation orders in 2025 offset by an increase in evaluation costs of $8.9 million primarily related to Mason project drilling activities.

- Other (income) expense decreased by $20.7 million, primarily due to an increase in mark-to-market gains of $53.4 million from investments, a decrease of $2.3 million in interest expense on long-term debt benefitting from the retirement of the 2026 senior unsecured notes, partially offset by an increase in foreign exchange loss of $30.9 million from the revaluation of foreign currency monetary balances and an increase in losses of $8.8 million from non-QP hedges.

For year-to-date 2026, other significant variances in expenses, compared to the same period in 2025, include the following:

- General administration expenses increased by $19.9 million, primarily due to an increase of $16.8 million in share-based compensation expense mostly from the revaluation of share units due to higher share prices compared to the prior period.

- Exploration expenses increased by $12.1 million, primarily due to Hudbay's planned Snow Lake exploration program consisting of modern geophysical programs and multi-phased drilling campaigns, most of which was funded by flow-through financing.

- Other operating expenses increased by $2.5 million, primarily due to an increase in evaluation costs of $10.6 million primarily relating to Mason project drilling activities, an increase of $5.1 million in amortization of community costs, partially offset by $11.5 million from business interruption insurance proceeds in Manitoba as noted above.

- Re-evaluation adjustment - environmental provision gain decreased by $8.6 million due to the relative revaluation of the environmental reclamation provision on Hudbay's Manitoba non-producing sites from changes in long-term risk-free discount and inflation rates.

- Other (income) expense increased by $68.9 million due to an increase in mark-to-market gains of $100.6 million from investments, an increase of $4.9 million in net interest income, a decrease of $3.8 million in net interest expense on long-term debt benefitting from the retirement of the 2026 senior unsecured notes, partially offset by a $44.7 million increase in net foreign exchange loss from the revaluation of foreign currency monetary balances.

Tax Expense

For the three months ended June 30, 2026, tax expense increased by $63.9 million compared to the same period in 2025. For the six months ended June 30, 2026, tax expense increased by $139.3 million compared to the same period in 2025. The following table provides further details:

(in $ millions)

Three months ended

Six months ended

Jun. 30,
2026

Jun. 30,
2025

Jun. 30,
2026

Jun. 30,
2025

Current tax expense - income tax

41.7

30.3

123.2

65.5

Deferred tax expense (recovery) - income tax¹

26.5

(10.5

)

44.7

10.2

Total income tax expense

68.2

19.8

167.9

75.7

Current tax expense - mining tax

32.7

17.6

81.2

36.2

Deferred tax expense (recovery) - mining tax¹

1.4

1.0

0.7

(1.4

)

Total mining tax expense

34.1

18.6

81.9

34.8

Tax expense

102.3

38.4

249.8

110.5

¹Deferred tax expense (recovery) represents Hudbay's draw down/increase of non-cash deferred income and mining tax assets/liabilities.

Income Tax Expense/Recovery

Applying the estimated Canadian statutory income tax rate of 26.7% to Hudbay's net earnings before taxes of $579.4 million for the year-to-date of 2026 would have resulted in a tax expense of approximately $154.7 million. Hudbay recorded an income tax expense of $167.9 million. The primary items causing Hudbay's effective income tax rate to be different than the 26.7% estimated Canadian statutory income tax rate are the following:

- The tax expense with respect to Hudbay's foreign operations is recorded using an income tax rate other than the Canadian statutory income tax rate of 26.7%, resulting a tax expense of $33.2 million.

- Current mining tax deductions resulted in a tax recovery of $23.0 million.

Mining Tax Expense

For the year-to-date 2026, Hudbay recorded a mining tax expense of $81.9 million. Effective mining tax rates can vary significantly based on the composition of Hudbay's earnings and the expected amount of mining taxable profits. Corporate costs and other costs not related to mining operations are not deductible in computing mining profits. A brief description of how mining taxes are calculated in Hudbay's various business units is discussed below.

Manitoba

The Province of Manitoba imposes mining tax on earnings related to the sale of mineral products mined in the Province of Manitoba (mining taxable profit) at the following rates:

- 10% of total mining taxable earnings if mining profit is C$50 million or less;

- Between mining earnings of C$50 and $C55 million, mining tax is equal to a minimum of C$5 million plus mining earnings less C$50 million multiplied by 65%;

- 15% of total mining taxable earnings if mining profits are between C$55 million and C$100 million;

- Between mining earnings of C$100 million and C$105 million, mining tax is equal to a minimum of C$15 million plus mining earnings less C$100 million multiplied by 57%; and

- 17% of total mining taxable earnings if mining profits exceed C$105 million.

Hudbay estimates that the deferred tax rate that will be applicable when temporary differences reverse will be approximately 10.0%.

Peru

The Peruvian government imposes two parallel mining tax regimes, the Special Mining Tax and the Modified Royalty, on companies' operating mining income on a sliding scale, with progressive rates ranging from 2.0% to 8.4% and 1.0% to 12.0%, respectively. Based on financial forecasts, Hudbay has recorded a deferred tax liability as at June 30, 2026, at the tax rate expected to be applied when temporary differences reverse.

British Columbia

The Province of British Columbia imposes a 13% net revenue tax on the sale of mineral products mined in the province of British Columbia after the mine owner has recovered the capital invested in the mine and its Cumulative Expenditure Account ("CEA") no longer has a balance. The tax is paid on the profit in excess of the capital that has been invested in the mine. British Columbia mineral tax is deductible for federal and provincial income tax purposes.

While there is a balance in the CEA account, the mine owner must pay a Net Current Proceeds ("NCP") tax of 2%. Any amounts paid as NCP can then be claimed in the future against net revenue taxes payable.

Hudbay estimates that the effective tax rate that will be applicable when temporary differences reverse will be approximately 9.49%.

LIQUIDITY AND CAPITAL RESOURCES

As at June 30, 2026, Hudbay's total liquidity of $1,044.6 million includes $890.9 million in cash, which excludes $49.8 million in Municipal Bond proceeds that is classified as restricted cash, as well as undrawn total availability of $153.7 million under Hudbay's revolving credit facilities.

Senior Unsecured Notes

As at June 30, 2026, Hudbay had $542.4 million aggregate principal amount of 2029 Notes.

On April 1, 2026, the Company completed the repayment of its 2026 Notes upon their maturity. The total principal amount settled was $472.5 million, plus accrued and unpaid interest. The repayment was funded using the Company's available cash on hand and $272.0 million through a draw on the Company's senior secured revolving credit facility.

Senior Secured Revolving Credit Facilities

Hudbay has two senior secured revolving credit facilities with total commitments of $450 million ("the Credit Facilities") for its Canadian and Peruvian businesses on substantially similar terms and conditions. The Credit Facilities include an accordion feature that allows Hudbay the option to increase the facility by an additional $150 million at Hudbay's discretion over the four-year term.

As at June 30, 2026, $272.0 million was drawn under the Credit Facilities and $24.3 million in letters of credit secured under the Canadian Credit Facility. The proceeds of the $272.0 million draw were used to repay the 2026 Notes, as mentioned earlier.

As at June 30, 2026, Hudbay was in compliance with its covenants under the Credit Facilities.

Municipal Bonds

On June 24, 2026, the Arizona Industrial Development Authority issued the Municipal Bonds. The Municipal Bonds carry a fixed interest rate of 4.50%, payable semi-annually, and have an initial mandatory tender date of July 2, 2036. The Municipal Bonds represent senior unsecured obligations of Copper World LLC and are guaranteed on a senior unsecured basis by Hudbay and its primary operating subsidiaries. The proceeds from this issuance help enhance the Company's overall liquidity position and are intended to support the ongoing development and capital requirements of the Copper World project, specifically with respect to qualifying solid waste disposal expenditures.

C$130 Million Bilateral Letter of Credit Facility

Hudbay has a C$130.0 million bilateral letter of credit facility ("LC Facility") with a major Canadian financial institution. The LC Facility has no financial covenants and enables Hudbay to issue up to C$130.0 million of letters of credit to beneficiaries on an unsecured basis at attractive rates, including C$30.0 million sub-limit for financial letters of credit. As at June 30, 2026, the Manitoba business unit had drawn $55.7 million in letters of credit under the LC Facility.

Surety Bonds and Letters of Credit

As at June 30, 2026, the United States business unit had $23.2 million in surety bonds issued to support future reclamation and closure obligations and the Peru business unit had $145.3 million in letters of credit issued with various Peruvian financial institutions to support future reclamation and other operating matters. In addition, the British Columbia business unit had $46.2 million in surety bonds issued to support future reclamation and $1.8 million in surety bonds and letters of credit to support other operating matters. No cash collateral is required to be posted under these surety bonds.

Working Capital

Working capital increased by $817.4 million to $751.8 million from December 31, 2025 to June 30, 2026, primarily due to a decrease in the current portion of long-term debt of $472.1 million as a result of a full repayment of the 2026 senior unsecured debt, an increase in cash and cash equivalents of $322.0 million as a result of the $411.7 million net proceeds from the sale of Copper World non-controlling interest, a decrease of $53.5 million in taxes payable, an increase in other financial assets of $52.5 million as a result of an increase in restricted cash from the $49.8 million proceeds received from the municipal bonds, a decrease in other financial liabilities of $27.9 million primarily as a result of the revaluation of derivative liabilities, a decrease in other liabilities of $27.6 million primarily relating to share-based compensation paid in the first quarter of 2026, and a decrease of $18.9 million relating to deferred revenue. These increases are offset by a $173.8 million decrease in trade and other receivables primarily related to the temporary build-up of concentrate inventory at the port in Peru caused by port closures resulting from ocean swells, and a decrease in inventory by $9.4 million.

Cash Flows

The following table summarizes Hudbay's cash flows for the three months ended June 30, 2026, March 31, 2026 and June 30, 2025 and for six months ended June 30, 2026 and June 30, 2025:

(in $ millions)	Three months ended						Six months ended
(in $ millions)	June. 30, 2026		Mar. 31, 2026		June. 30, 2025		June. 30, 2026		June. 30, 2025
Operating cash flow before change in non-cash working capital	210.1		208.7		193.9		418.8		357.4
Change in non-cash working capital	86.9		2.6		66.0		89.5		27.3
Cash generated from operating activities	297.0		211.3		259.9		508.3		384.7
Cash used in investing activities	(154.5	)	(166.6	)	(100.6	)	(321.1	)	(184.9	)
Cash (used in) generated from financing activities	(253.8	)	391.9		(98.9	)	138.1		(119.7	)
Effect of movement in exchange rates on cash	(1.6	)	(1.7	)	2.5		(3.3	)	3.6
Net (decrease) increase in cash	(112.9	)	434.9		62.9		322.0		83.7

Cash Flow from Operating Activities

Cash generated from operating activities was $297.0 million during the second quarter of 2026, an increase of $37.1 million compared to the same period in 2025. Operating cash flow before change in non-cash working capital was $210.1 million during the second quarter of 2026, reflecting an increase of $16.2 million compared to the second quarter of 2025. The increase in operating cash flows before change in working capital compared with the second quarter of 2025 was primarily the result of higher metal prices, partially offset by higher cash taxes paid which are a function of higher profits in earlier quarters in Peru and Manitoba that were subsequently payable.

During the six months ended June 30, 2026 cash generated from operating activities was $508.3 million, an increase of $123.6 million compared to the same period in 2025. Operating cash flow before changes in non-cash working capital for the six months ended June 30, 2026 was $418.8 million, an increase of $61.4 million compared to the same period in 2025. The increas was primarily the result of higher metal prices. This was partially offset by a significant increase in cash taxes paid of $101.4 million and stock based compensation paid, compared to the same period in 2025.

Cash Flow from Investing and Financing Activities

During the second quarter of 2026, Hudbay spent $408.3 million in investing and financing activities, primarily driven by the $472.5 million repurchase of the 2026 senior unsecured notes, $152.9 million in capital expenditures, $16.4 million in capitalized lease and equipment financing payments, $13.0 million in community agreement payments, $7.2 million in net purchases of investments, $3.1 million in financing costs paid and $2.8 million in dividends paid. This was partially offset by $272.0 million proceeds received from the drawdown of the revolving credit facility.

During the six months ended June 30, 2026 Hudbay spent $183.0 million in investing and financing activities, primarily driven by the $472.5 million repurchase of the 2026 senior unsecured note, $293.1 million in capital expenditures, $38.7 million in purchase of investments, $32.5 million in capitalized lease and equipment financing payments, $30.0 million in interest paid on Hudbay's long-term debt, $16.7 million in community agreement payments, $5.9 million in financing costs paid and $5.7 million in dividends paid. This was partially offset by cash $272.0 million proceeds received from the drawdown of the revolving credit facility and $16.1 million in investment income received.

Capital Expenditures

The following summarizes accrued and cash additions to capital assets for the periods indicated:

	Three months ended						Six months ended				Guidance
	Jun. 30, 2026		Mar. 31, 2026		Jun. 30, 2025		Jun. 30, 2026		Jun. 30, 2025		Annual
(in $ millions)	Jun. 30, 2026		Mar. 31, 2026		Jun. 30, 2025		Jun. 30, 2026		Jun. 30, 2025		2026²
Sustaining capital expenditures
Peru ¹	26.4		22.9		44.4		49.3		72.9		140.0
Manitoba ¹	20.7		17.2		11.3		37.9		23.8		105.0
British Columbia ^1,3	33.0		46.9		32.9		79.9		54.4		190.0
Total sustaining capital expenditures	80.1		87.0		88.6		167.1		151.1		435.0
Copper World growth capitalized costs⁴	38.3		29.6		13.7		67.9		25.1		135.0
Growth capital expenditures
Peru	6.0		1.4		1.3		7.4		2.2		40.0
Manitoba	2.5		3.4		1.6		5.9		3.9		15.0
British Columbia	30.6		9.5		16.5		40.1		27.5		115.0
Total growth capital expenditures - excluding Copper World	39.1		14.3		19.4		53.4		33.6		170.0
Capitalized exploration	8.4		5.8		3.5		14.2		4.5		25.0
Cactus Project capitalized costs	4.0		-		-		4.0		-
Right-of-use asset and property, plant & equipment financing additions	34.7		36.6		13.9		71.3		28.9
LOM community agreement adjustments	(0.6	)	(0.1	)	0.6		(0.7	)	0.6
Non-cash capitalized stripping	6.1		9.4		8.5		15.5		14.9
Grants and other capitalized costs	(0.3	)	(0.1	)	(0.8	)	(0.4	)	(1.9	)
Total other non-sustaining capital costs⁵	129.7		95.5		58.8		225.2		105.7
Total accrued capital additions	209.8		182.5		147.4		392.3		256.8

Reconciliation to cash capital additions:
Other capitalized costs²	(40.2	)	(45.9	)	(23.0	)	(86.1	)	(44.4	)
Change in capital accruals and other	(16.7	)	3.6		(2.7	)	(13.1	)	0.6
Acquisition of property, plant & equipment - cash	152.9		140.2		121.7		293.1		213.0

¹Peru, Manitoba and British Columbia sustaining capital expenditures include capitalized stripping costs and capitalized development.

² Other capitalized costs primarily include right-of-use lease and equipment financing additions, which are excluded from guidance in 2026, community agreement additions and non-cash capitalized stripping.

³Includes 100% of Copper Mountain mine production. On April 30, 2025 Hudbay completed the acquisition of the remaining 25% interest in the Copper Mountain mine and now owns 100%.

⁴Copper World growth capital shown on a 100% basis.

⁵Other non-sustaining capital costs include Copper World capitalized costs, Cactus Project capitalized costs, capitalized interest, capitalized exploration, right-of-use lease asset additions, equipment financing asset additions, growth capital expenditures and reclassification related to capital spares.

For the three and six months ended June 30, 2026, total accrued capital expenditures increased by $62.4 million and $135.5 million, respectively, compared to the same period in 2025, primarily due to a planned increase in growth capital in British Columbia and planned increase in Copper World growth capital.

Sustaining capital expenditures in Manitoba for the three and six months ended June 30, 2026 were $20.7 million and $37.9 million, respectively, representing an increase of $9.4 million and $14.1 million, respectively, compared to the same periods in 2025, primarily driven by higher capital development at Lalor, mill improvement projects, and increased project spending on the SART plant and tailing dam raise. Sustaining capital expenditures in Peru for the three and six months ended June 30, 2026 were $26.4 million and $49.3 million, respectively, representing a decrease of $18.0 million and $23.6 million, respectively, compared to the same periods in 2025 as a result of the timing of various stripping campaigns and civil work projects. Sustaining capital expenditures in British Columbia for the three and six months ended June 30, 2026 were $33.0 million and $79.9 million, respectively, which included $23.0 million and $64.9 million, respectively, of capitalized stripping related to Hudbay's planned three-year accelerated stripping campaign to access higher grade ore.

Growth capital spending in Manitoba for the three and six months ended June 30, 2026 was $2.5 million and $45.9 million, respectively, primarily relating to the 1901 deposit, representing an increase of $0.9 million and $2.0 million, respectively, compared to the same periods in 2025. Growth capital expenditures in Peru for the three and six months ended June 30, 2026 were $6.0 million and $7.4 million, respectively, representing an increase of $4.7 million and $5.2 million, respectively. Copper World's capital expenditures for the three and six months ended June 30, 2026 were $38.3 million and $67.9 million, respectively, mainly related to ongoing carrying costs and feasibility preparation.

Capitalized exploration for the three months and six months ended June 30, 2026 was $8.4 million and $14.2 million, respectively, primarily related to New Ingerbelle.

Hudbay expects full year sustaining capital expenditure to be in line with 2026 guidance. Full year growth capital expenditures are expected to be approximately $30 million higher than the original 2026 guidance related to additional infrastructure development costs at New Ingerbelle in British Columbia.

Capital Commitments

As at June 30, 2026, Hudbay had outstanding capital commitments in Canada of approximately $68.9 million, of which $52.4 million can be terminated, approximately $19.2 million in Peru primarily related to sustaining capital commitments and exploration option agreements, all of which can be terminated, and approximately $114.5 million in United States, primarily related to the Copper World project, of which $112.3 million can be terminated.

Contractual Obligations

The following table summarizes Hudbay's significant contractual obligations as at June 30, 2026:

	Total	Less than 12 months	13 - 36 months	37 - 60 months	More than 60 months
Payment Schedule (in $ millions)	Total	Less than 12 months	13 - 36 months	37 - 60 months	More than 60 months
Long-term debt obligations¹	1,031.6	51.8	910.2	4.7	64.9
Property, plant and equipment financing and lease obligations	288.1	95.3	122.9	52.7	17.2
Purchase obligation - capital commitments	202.6	157.0	34.0	1.0	10.6
Purchase obligation - other commitments²	1,160.7	481.8	240.9	116.5	321.5
Deferred payment and contingent obligations	36.8	3.0	6.0	13.5	14.3
Pension and other employee future benefits obligations³	89.0	4.3	15.0	8.0	61.7
Deferred land payments	119.6	5.0	10.0	104.6	-
Community agreement obligations^{4, 5}	115.2	51.8	13.3	9.1	41.0
Decommissioning and restoration obligations⁵	526.8	16.3	13.6	12.3	484.6
Total	3,570.4	866.3	1,365.9	322.4	1,015.8

¹Long-term debt obligations include scheduled interest payments, as well as principal repayments

²Primarily made up of trades payables, accrued liabilities, long-term agreements with operational suppliers, obligations for power purchases, concentrate handling and fleet and port services.

³ Discounted.

⁴Represents community agreement obligations and various finalized land user agreements, including Pampacancha.

⁵ Undiscounted before inflation.

In addition to the contractual obligations included in the above payment schedule, Hudbay also has the following commitments which impact Hudbay's financial position:

- A profit-sharing plan with most Manitoba employees;

- A profit-sharing plan with all Peru employees;

- Share-based compensation;

- Wheaton precious metals stream agreement for the Constancia mine;

- Government royalty payments related to the Constancia mines;

- Participation agreements related to the Copper Mountain mine, and

- Contracts related to future production and sales, such as royalties.

Outstanding Share Data

As of July 27, 2026, the final trading day prior to the date of this MD&A, there were 444,144,760 common shares of Hudbay issued and outstanding. In addition, there were 2,423,222 stock options outstanding.

TREND ANALYSIS AND QUARTERLY REVIEW

A detailed quarterly and annual summary of financial and operating performance can be found in the "Summary of Results" section at the end of this MD&A. The following table sets forth selected consolidated financial information for each of Hudbay's eight most recently completed quarters:

(in $ millions, except per share amounts, production on a copper equivalent basis and average realized copper price)	2026		2025				2024
	Q2	Q1	Q4²	Q3	Q2	Q1	Q4²	Q3
Production on a copper equivalent basis (tonnes)	51,449	57,635	71,242	46,224	53,693	58,611	77,769	60,895
Average realized copper price ($/lb)	6.13	5.81	5.17	4.37	4.36	4.49	4.09	4.24
Average realized gold price ($/oz)	4,312	4,468	3,580	3,522	3,135	3,002	2,327	2,592
Revenue	631.3	757.3	732.9	346.8	536.4	594.9	584.9	485.8
Gross profit	269.0	368.0	270.1	65.3	176.5	231.3	184.4	139.8
Income before tax	240.4	339.0	257.1	330.5	153.1	171.3	103.7	79.7
Net income (loss)	138.1	191.5	128.0	222.4	114.7	99.2	19.3	50.3
Net income (loss) - attributable	137.4	190.4	128.0	222.4	117.7	100.4	21.2	49.7
Adjusted net earnings ¹- attributable	113.5	159.1	86.0	10.1	75.5	93.8	70.3	50.2
Earnings (loss) per share attributable:
Basic and diluted	0.34	0.48	0.32	0.56	0.30	0.25	0.05	0.13
Adjusted net earnings¹ per share - attributable	0.28	0.40	0.22	0.03	0.19	0.24	0.18	0.13
Operating cash flow before change in non-cash working capital	210.1	208.7	336.9	70.3	193.9	163.5	231.5	188.3
Adjusted EBITDA¹	321.2	421.9	385.9	142.6	245.2	287.2	257.3	206.0
Adjusted EBITDA LTM¹	1,271.6	1,195.6	1,060.9	932.3	995.9	895.7	823.3	840.4

¹ Adjusted net earnings (loss) - attributable to owners, adjusted net earnings (loss) per share - attributable to owners, adjusted EBITDA, and adjusted EBITDA last twelve months ("LTM") are non-GAAP financial performance measure with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-GAAP Financial Performance Measures" section of this MD&A.

² Annual consolidated results may not calculate based on amounts presented in this table due to rounding.

On a quarterly basis, Hudbay's revenue is primarily impacted by metal prices, production mix and sales volumes of the key metals Hudbay produces. In addition to these factors, gross profit, net earnings (loss) attributable, earnings (loss) per share attributable, operating cash flow before change in non-cash working capital and adjusted EBITDA are also impacted by input costs. Net earnings (loss) and earnings (loss) per share are further impacted by net finance expense and re-evaluation adjustments of Hudbay's closed site environmental provision.

During the second quarter of 2026, copper equivalent production, sales and gross margin declined compared to the most recent period, primarily driven by lower overall production volumes and lower realized gold prices compared to the first quarter of 2026. Consequently, revenue, gross profit and income before tax decreased during the quarter. Sales volumes was impacted by a temporary build-up of concentrate inventory at the port in Peru. This accumulation was caused by ocean swells that resulted in temporary port closures and delayed scheduled shipments, which have been realized during the first half of July 2026. In addition, given global political tensions, energy and consumable input prices have risen and this has exerted pressure on gross profit.

During the first quarter of 2026, revenue and gross profit reached record levels, driven by higher realized metal prices and disciplined cost management, which resulted in record quarterly and last twelve months adjusted EBITDA. While consolidated copper equivalent production decreased to 51,449 tonnes compared to the most recent quarter following the planned depletion of Pampacancha, consolidated cash cost improved following the successful initial ramp up of the secondary SAG mill, leading to improved throughput levels and enhanced operational efficiencies. Operating cash flow decreased primarily due to higher cash taxes paid and elevated share-based compensation payments resulting from higher share prices, these were partially offset by lower depreciation charges following the Pampacancha closure and by higher realized metal prices across all metals.

During the fourth quarter of 2025, copper equivalent production increased to 71,242 tonnes compared to the most recent quarters. This was primarily due to higher realized price across all metals, partially offset by a one-week power outage in Manitoba during the fourth quarter of 2025 due to weather related constraints. Hudbay achieved record quarterly revenue of $732.9 million as a result of high metal prices, despite the one-week operational interruption in Manitoba in October. In addition, along with continued strong cost control and productivity gains coming from previous investments in optimization efforts, Hudbay achieved record high gross profit. The cumulative effect of the high commodity prices, cost control and optimization efforts resulted in Hudbay achieving record adjusted EBITDA over a twelve month period of $1.06 billion.

During the third quarter of 2025, copper equivalent production decreased to 46,224 tonnes because of reduced copper and zinc output. This was primarily due to the temporary suspension of operations in Manitoba in July and August related to the wildfire evacuation order and the Peru temporary suspension for nine days during the third quarter of 2025 caused by social unrest. As a result of the social unrest impacting transportation routes earlier in the quarter and ocean swells impacting port shipments in late September, a 20,000 dry metric tonne copper concentrate shipment valued at $60 million was deferred to early October 2025. The temporary operational suspensions during the quarter increased pressure on gross margins and operating cash flow compared to the earlier quarters. Earnings in the third quarter of 2025 also included an after-tax impairment reversal of $242.7 million, following the announcement of the Copper World joint venture transaction with Mitsubishi for a 30% minority interest.

After adjusting for the fixed costs associated with the temporary suspensions in Manitoba and Peru, production costs continue to be well controlled and comparable to prior periods.

During the second quarter of 2025, copper equivalent production decreased to 53,693 tonnes because of reduced copper, gold and silver output. This was primarily due to the temporary suspension of operations in Manitoba in June related to the wildfire evacuation order. This was partially offset by record average gold prices and high copper prices which positively impacted gross profits and contributing to increased net income and higher earnings per share in the second quarter of 2025. While higher profitability led to significant cash taxes paid of $43.9 million, the business's strong operating performance caused the overall impact to operating cash flow before changes in non-cash working capital to remain positive. Higher foreign exchange gains due to the strengthening of the Canadian dollar along with declining net interest cost as a result of Hudbay's deleveraging efforts led to reduced net finance expenses in the second quarter. Adjusted EBITDA over the last twelve months hit a record high of $995.9 million as a result of strong operating performances at the Manitoba and Peru operations resulting in higher sales volumes, benefitting from high copper and gold prices. Net debt to EBITDA is now at its lowest level since the development of the Peru operation more than a decade ago given the business's strong operating performance in conjunction with the same aforementioned deleveraging efforts. The lower net debt and stronger cash position is despite larger reinvestment in the business through growing capital expenditures in recent years.

During the first quarter of 2025, copper equivalent production decreased to 58,611 tonnes as expected, reflecting lower production of copper, gold and silver primarily related to lower planned grades in Peru as the final stripping phase at the Pampacancha deposit was underway. This was partially offset by higher gold production in Manitoba and record average gold prices and high copper prices which positively impacted gross profits.

The Manitoba operations delivered strong quarterly throughput as expected and unlocked better-than-expected grades, resulting in higher production that exceeded Hudbay's quarterly cadence expectations. Strong cost control, a weaker Canadian dollar and meaningful exposure to gold by-product credits resulted in consolidated cash cost¹ and sustaining cash cost¹per pound of copper produced, net of by-product credits, in the first quarter of 2025 of $(0.45) and $0.72, respectively, contributing to the increased gross margin and very strong growth in adjusted EBITDA. Higher profits since 2023 in Peru and Canada have resulted in significant cash taxes paid of $117.5 million in the first quarter of 2025, which is reflected in operating cash flow before changes in non-cash working capital. In addition, deleveraging efforts including the repurchases of the Company's senior secured notes over the course of 2024 led to declining net interest cost to service Hudbay's long term debt.

During the fourth quarter of 2024, copper equivalent production increased to 77,769 tonnes. Hudbay's Manitoba and Peru operations delivered strong quarterly production as expected and unlocked higher grade helping the Company exceed 2024 annual gold guidance. Strong cost control and meaningful exposure to gold by-product credits resulted in consolidated cash cost¹ and sustaining cash cost¹ per pound of copper produced, net of by-product credits¹, in the fourth quarter of 2024 of $0.45 and $1.37, respectively, contributing to Hudbay's outperformance of its improved full year 2024 cost guidance. Furthermore, the settlement of the gold prepayment liability in the third quarter of 2024, allowed Hudbay to capitalize on surging gold prices. Since acquiring Copper Mountain in June 2023, Hudbay has moved to optimization efforts which have been focused on ramping up the mining fleet to execute a planned accelerated stripping campaign to gain access to higher grades, as well as plant improvement initiatives to improve mill reliability and recoveries.

During the third quarter of 2024, profitability and cash flows grew compared to the second quarter of 2024. This strength was attributable in part to higher gold, copper and zinc production compared to the second quarter of 2024, along with returning strength in commodity prices including record gold prices. These impacts offset planned lower mined grades observed in Peru in the third quarter of 2024 and the higher cash mining taxes paid in Peru resulting from higher profitability over the past several quarters. Strong operating cost control continued into the third quarter of 2024 resulting from a number of operational initiatives and high levels of mill throughput being experienced throughout the business.

NON-GAAP FINANCIAL PERFORMANCE MEASURES

Adjusted net earnings (loss) attributable to owners, adjusted net earnings (loss) per share attributable to owners, adjusted EBITDA, realized prices, net debt, net debt to adjusted EBITDA, free cash flow, cash cost, sustaining and all-in sustaining cash cost per pound of copper produced, cash cost and sustaining cash cost per ounce of gold produced, combined unit cost and ratios based on these measures are non-GAAP performance measures. These measures do not have a meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other issuers. These measures should not be considered in isolation or as a substitute for measures prepared in accordance with IFRS and are not necessarily indicative of gross profit or cash flow from operations as determined under IFRS. Other companies may calculate these measures differently.

Management believes adjusted net earnings (loss) attributable to owners and adjusted net earnings (loss) per share attributable to owners provides an alternate measure of the Company's performance for the current period and gives insight into its expected performance in future periods. These measures are used internally by the Company to evaluate the performance of its underlying operations and to assist with its planning and forecasting of future operating results. As such, the Company believes these measures are useful to investors in assessing the Company's underlying performance. Hudbay provides adjusted EBITDA to help users analyze Hudbay's results and to provide additional information about its ongoing cash generating potential in order to assess its capacity to service and repay debt, carry out investments and cover working capital needs. Net debt is shown because it is a performance measure used by the Company to assess its financial position. Net debt to adjusted EBITDA is shown because it is a performance measure used by the Company to assess its financial leverage and debt capacity. Realized price is shown to understand the average realized price of metals sold to third parties in each reporting period. Free cash flow is shown as it provides investors and management additional information in assessing the Company's ability to generate cash flow from current operations after investing in capital to sustain the operations. Cash cost, sustaining and all-in sustaining cash cost per pound of copper produced are shown because Hudbay believes they help investors and management assess the performance of its operations, including the margin generated by the operations and the Company. Cash cost and sustaining cash cost per ounce of gold produced are shown because Hudbay believes they help investors and management assess the performance of its Manitoba operations. Combined unit cost is shown because Hudbay believes it helps investors and management assess the cost structure and margins that are not impacted by variability in by-product commodity prices.

Adjusted Net Earnings - Attributable to owners

Adjusted net earnings attributable to owners represents net earnings (loss) excluding certain impacts such as mark-to-market adjustments, foreign exchange (gains) loss, revaluation adjustment - environmental provisions for closed sites, variable consideration adjustment related to stream agreements, impairment charges and reversal of impairment charges on assets, (gain) loss on disposal of assets, evaluation costs, temporary shut down costs other items that are not indicative of the underlying operating performance of Hudbay's core business; and tax effect and non-controlling interest of the previously discussed items. These measures are not necessarily indicative of net earnings (loss) as determined under IFRS. The following table provides a reconciliation of net earnings and non-controlling interest per the condensed consolidated interim statements of income, to adjusted net earnings attributable to owners of the Company for the three months ended June 30 and March 31, 2026, and June 30, 2025 and six months ended June 30, 2026 and 2025.

	Three months ended						Six months ended
(in $ millions)	Jun. 30, 2026		Mar. 31, 2026		Jun. 30, 2025		Jun. 30, 2026		Jun. 30, 2025
Earnings for the period	138.1		191.5		114.7		329.6		213.9
Tax expense	102.3		147.5		38.4		249.8		110.5
Earnings before tax	240.4		339.0		153.1		579.4		324.4
Adjusting items:
Mark-to-market adjustments¹	(38.2	)	(38.7	)	6.3		(76.9	)	3.2
Foreign exchange (gain) loss	12.0		10.7		(18.9	)	22.7		(22.0	)
Re-evaluation adjustment - environmental provision	5.5		2.1		(13.8	)	7.6		(1.0	)
Manitoba cost of sales and other expense from temporary shutdown	-		-		5.3		-		5.3
Variable consideration adjustment - stream revenue and accretion	-		0.1		-		0.1		(10.5	)
Inventory adjustments	0.9		-		3.5		0.9		4.7
Evaluation expenses	9.2		2.9		-		12.1		-
Insurance recovery	(11.5	)	-		-		(11.5	)	-
Reduction of obligation to renounce flow-through share expenditures, net of provisions	(2.8	)	(3.3	)	(1.2	)	(6.1	)	(3.1	)
Loss/write-down on disposal of PP&E	0.5		1.0		0.3		1.5		0.9
Changes in other provisions (non-capital)	-		-		-		-		0.7
Adjusted earnings before income taxes	216.0		313.8		134.6		529.8		302.7
Tax expense	(102.3	)	(147.5	)	(38.4	)	(249.8	)	(110.5	)
Tax impact of adjusting items	0.5		(4.2	)	(23.0	)	(3.7	)	(25.7	)
Adjusted net earnings	114.2		162.1		73.2		276.3		166.5
Adjusted net earnings attributable to non-controlling interest:
Net (earnings) loss for the period	(0.7	)	(1.1	)	3.0		(1.8	)	4.2
Adjusting items, including tax impact	-		-		(0.7	)	-		(1.1	)
Adjusted net earnings - attributable to owners	113.5		161.0		75.5		274.5		169.6
Adjusted net earnings ($/share) - attributable to owners	0.28		0.40		0.19		0.69		0.43
Basic weighted average number of common shares outstanding (millions)	400.4		396.9		395.1		397.7		395.0

¹ Includes changes in fair value of Canadian junior mining investments, other financial assets and liabilities at fair value through net earnings and share-based compensation expenses (recoveries). Also includes gains and losses on disposition of investments.

Adjusted EBITDA

Adjusted EBITDA is net earnings before net finance expense/income, tax expense/recoveries, depreciation and amortization of property, plant and equipment and deferred revenue, as well as certain other adjustments. Hudbay calculates adjusted EBITDA by excluding certain adjustments included within Hudbay's adjusted net earnings attributable measure which reflects the underlying performance of Hudbay's core operating activities. The measure also removes the impact of non-cash items and financing costs that are not associated with measuring the underlying performance of Hudbay's operations. However, Hudbay's adjusted EBITDA is not the measure defined as EBITDA under Hudbay's senior notes or revolving credit facilities and may not be comparable with performance measures with the same name reported by other companies. Adjusted EBITDA should not be considered as a substitute for earnings, which is calculated in accordance with IFRS. Hudbay provides adjusted EBITDA to help users analyze their results and to provide additional information about Hudbay's ongoing cash generating potential in order to assess its capacity to service and repay debt, carry out investments and cover working capital needs.

The following table presents the reconciliation of earnings per the condensed consolidated interim statements of income, to adjusted EBITDA for the three months ended June 30 and March 31, 2026, and June 30, 2025 and six months ended June 30, 2026 and 2025:

	Three months ended						Six months ended
(in $ millions)	Jun. 30, 2026		Mar. 31, 2026		Jun. 30, 2025		Jun. 30, 2026		Jun. 30, 2025
Earnings for the period	138.1		191.5		114.7		329.6		213.9
Add back:
Tax expense	102.3		147.5		38.4		249.8		110.5
Other (income) expense	(20.7	)	(33.8	)	-		(54.5	)	14.4
Other operating expense	4.7		10.1		7.1		14.8		12.3
Depreciation and amortization	88.8		99.9		96.4		188.7		204.5
Amortization of deferred revenue and variable consideration adjustment	(9.5	)	(19.5	)	(15.4	)	(29.0	)	(44.7	)
Adjusting items (pre-tax):
Re-evaluation adjustment - environmental provision	5.5		2.1		(13.8	)	7.6		(1.0	)
Inventory adjustments	0.9		-		3.5		0.9		4.7
Overhead costs incurred during Manitoba temporary suspension (cash)	-		-		3.2		-		3.2
Option agreement proceeds	1.0		0.6		1.0		1.6		2.5
Realized loss on non-QP hedges	(0.1	)	-		(0.4	)	(0.1	)	(2.3	)
Share-based compensation expense ¹	10.2		23.5		10.5		33.7		14.4
Adjusted EBITDA	321.2		421.9		245.2		743.1		532.4

¹ Share-based compensation expense reflected in cost of sales and selling and administrative expenses.

Net Debt

The following table presents Hudbay's calculation of net debt as at June 30, 2026 and December 31, 2025:

(in $ millions)	Jun. 30, 2026		Dec. 31, 2025
Total long-term debt	860.2		1,008.6
Cash and cash equivalents¹	(890.9	)	(568.9	)
Restricted cash related to unspent proceeds on senior unsecured municipal bonds ²	(49.8	)	-
Net debt ²	(80.5	)	439.7

¹ As at June 30, 2026 cash and cash equivalents includes $334.5 million in cash held by Copper World LLC. These funds are contractually restricted for the advancement of the Copper World project and are not available to the general Hudbay group.

²Hudbay calculates net debt as total long-term debt less cash and cash equivalents and restricted cash related to unspent proceeds of its senior unsecured municipal bond financing. For further information on the restricted cash related to unspent proceeds of senior unsecured municipal bond financing please see note 11 in the consolidated interim financial statements.

Net Debt to Adjusted EBITDA Ratio

The following table presents Hudbay's calculation of net debt to adjusted EBITDA, both metrics have been reconciled above to the most comparable IFRS measure, as at June 30, 2026 and December 31, 2025:

(in $ millions, except net debt to adjusted EBITDA ratio)	Jun. 30, 2026		Dec. 31, 2025
Net debt	(80.5	)	439.7
Adjusted EBITDA for the last twelve months	1,271.6		1,060.9
Net debt to adjusted EBITDA	(0.1	)	0.4

The following table presents the reconciliation of earnings per the condensed consolidated interim statements of income, to adjusted EBITDA for the twelve months ended June 30, 2026 and December 31, 2025:

	Twelve months ended
(in $ millions)	Jun. 30, 2026		Dec. 31, 2025
Earnings for the period	680.0		564.3
Add back:
Tax expense	487.0		347.7
Net finance expense	(49.5	)	19.4
Other operating expense	10.3		7.8
Depreciation and amortization	423.9		439.7
Amortization of deferred revenue and variable consideration adjustment	(59.3	)	(75.0	)
Adjusting items (pre-tax):
Impairment reversal	(322.3	)	(322.3	)
Consideration received from previously sold non-core project	(14.9	)	(14.9	)
Re-evaluation adjustment - environmental provision	8.8		0.2
Inventory adjustments	0.3		4.1
Overhead costs incurred during Manitoba temporary suspension (cash)	16.0		19.2
Overhead costs incurred during Peru temporary suspension (cash)	8.6		8.6
Option agreement proceeds	3.6		4.5
Realized loss on non-QP hedges	(0.1	)	(2.3	)
Share-based compensation expense ¹	79.2		59.9
Adjusted EBITDA for the last twelve months	1,271.6		1,060.9

¹ Share-based compensation expense reflected in cost of sales and selling and administrative expenses.

The following table presents the calculation of the last twelve months adjusted EBITDA:

	Three months ended								LTM¹
Trailing Adjusted EBITDA (in $ millions)	Jun. 30, 2026		Mar. 31, 2026		Dec. 31, 2025		Sep. 30, 2025		LTM¹
Earnings for the period	138.1		191.5		128.0		222.4		680.0
Add back:
Tax expense	102.3		147.5		129.1		108.1		487.0
Other (income) expenses	(20.7	)	(33.8	)	(14.6	)	19.6		(49.5	)
Other operating expenses	4.7		10.1		(13.6	)	9.1		10.3
Depreciation and amortization	88.8		99.9		152.5		82.7		423.9
Amortization of deferred revenue and variable consideration adjustment	(9.5	)	(19.5	)	(24.0	)	(6.3	)	(59.3	)
Adjusting items (pre-tax):
Impairment reversal	-		-		-		(322.3	)	(322.3	)
Consideration received from previously sold non-core project	-		-		-		(14.9	)	(14.9	)
Re-evaluation adjustment - environmental provision	5.5		2.1		(0.2	)	1.4		8.8
Inventory adjustments	0.9		-		0.7		(1.3	)	0.3
Overhead costs incurred during Manitoba temporary suspension (cash)	-		-		-		16.0		16.0
Overhead costs incurred during Peru temporary suspension (cash)	-		-		1.3		7.3		8.6
Realized loss on non-QP hedges	(0.1	)	-		-		-		(0.1	)
Option agreement proceeds	1.0		0.6		0.9		1.1		3.6
Share-based compensation expenses²	10.2		23.5		25.8		19.7		79.2
Adjusted EBITDA	321.2		421.9		385.9		142.6		1,271.6

¹ LTM (last twelve months) as of June 30, 2026.
² Share-based compensation expense reflected in cost of sales and administrative expenses.

Free Cash Flow

Hudbay defines free cash flow as cash generated from operations adjusted for changes in non-cash working capital, sustaining capital expenditures and cash payments from operating sites related to leases, equipment financings and community agreements. Free cash flow is intended to provide additional information only and should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS Accounting Standards. This measure is not necessarily indicative of cash flow from operations as determined under IFRS Accounting Standards. The following table presents Hudbay's calculation of free cash flow and reconciles to the most directly comparable IFRS measure:

Three months ended

Six months ended

(in $ millions)

Jun. 30,
2026

Jun. 30,
2025

Jun. 30,
2026

Jun. 30,
2025

Cash generated from operations

297.0

259.9

508.3

384.7

Add back:

Change in non-cash working capital

86.9

66.0

89.5

27.3

Cash sustaining capital expenditures¹

108.3

107.2

214.1

186.3

Free cash flow

101.8

86.7

204.7

171.1

Cash sustaining capital expenditures¹

Total sustaining capital costs²

80.1

88.6

167.1

151.1

Capitalized lease and equipment financing cash payments - operating sites

15.2

13.4

30.3

26.2

Community agreement cash payments

13.0

5.2

16.7

9.0

Cash sustaining capital expenditures¹

108.3

107.2

214.1

186.3

¹Excludes amortization of decommissioning and restoration PP&E assets and accretion of decommissioning and restoration liabilities related to producing sites. Includes all community agreement payments.

² See reconciliation to property, plant & equipment additions on page 59 of this MD&A.

The following table presents the calculation of the last twelve months free cash flow:

	Three months ended						LTM¹
(in $ millions)	Jun. 30, 2026	Mar. 31, 2026	Dec. 31, 2025		Sep. 30, 2025		LTM¹
Cash generated from operations	297.0	211.3	209.4		113.5		831.2
Add back:
Change in non-cash working capital	86.9	2.6	(127.5	)	43.2		5.2
Cash sustaining capital expenditures²	108.3	106.4	111.9		86.4		413.0
Free cash flow	101.8	102.3	225.0		(16.1	)	413.0

Cash sustaining capital expenditures²
Total sustaining capital costs³	80.1	87.0	91.8		71.2		330.1
Capitalized lease and equipment financing cash payments - operating sites	15.2	15.7	12.5		14.3		57.7
Community agreement cash payments	13.0	3.7	7.6		0.9		25.2
Cash sustaining capital expenditures²	108.3	106.4	111.9		86.4		413.0

¹LTM (last twelve months) as at June 30, 2026

² Excludes amortization of decommissioning and restoration PP&E assets and accretion of decommissioning and restoration liabilities related to producing sites. Includes all community agreement payments.

³See reconciliation to property, plant & equipment additions on page 60 of this MD&A.

Cash Cost, Sustaining and All-in Sustaining Cash Cost (Copper Basis)

Cash cost per pound of copper produced ("cash cost") is a non-GAAP measure that management uses as a key performance indicator to assess the performance of its operations. Hudbay's calculation designates copper as the primary metal of production as it has been the largest component of revenues. The calculation is presented in four manners:

- Cash cost, before by-product credits - This measure is gross of by-product revenues and is a function of the efforts and costs incurred to mine and process all ore mined. However, the measure divides this aggregate cost over only pounds of copper produced, Hudbay's primary metal of production. This measure is generally less volatile from period to period, as it is not affected by changes in the price received for by-product metals. It is, however, affected by the relative mix of copper concentrate and zinc concentrate production, where an increase in production of zinc concentrate will tend to result in an increase in cash cost under this measure.

- Cash cost, net of by-product credits - In order to calculate the net cost to produce and sell copper, the net of by-product credits measure subtracts the revenues realized from the sale of the metals other than copper. The by-product revenues from zinc, gold, and silver are significant and are integral to the economics of Hudbay's operations. The economics that support Hudbay's decision to produce and sell copper would be different if Hudbay did not receive revenues from the other significant metals being extracted and processed. This measure provides management and investors with an indication of the minimum copper price consistent with positive operating margins, assuming realized by-product metal prices are consistent with those prevailing during the reporting period. It also serves as an important operating statistic that management and investors utilize to measure its operating performance versus that of its competitors. However, it is important to understand that if by-product metal prices decline alongside copper prices, the cash cost net of by-product credits would increase, requiring a higher copper price than that reported to maintain positive cash flows and operating margins.

- Sustaining cash cost, net of by-product credits - This measure is an extension of cash cost that includes cash sustaining capital expenditures, including payments on capitalized leases, payments on equipment financing, capitalized sustaining exploration, net smelter returns royalties, payments on certain long-term community agreements, as well as accretion and amortization for expected decommissioning activities for producing assets. It does not include corporate selling and administrative expenses. It provides a more fulsome measurement of the cost of sustaining production than cash cost, which is focused on operating costs only.

- All-in sustaining cash cost, net of by-product credits - This measure is an extension of sustaining cash cost that includes corporate G&A, regional costs, accretion and amortization for community agreements relating to current operations, and accretion for expected decommissioning activities for non-producing sites. Due to the inclusion of corporate selling and administrative expenses, all-in sustaining cash cost is presented on a consolidated basis only.

The tables below present a detailed build-up of cash cost and sustaining cash cost, net of by-product credits, by business unit in addition to consolidated all-in sustaining cash cost, net of by-product credits, and reconciliations between cash cost, net of by-product credits, to the most comparable IFRS measures of cost of sales for the three months ended June 30, and March 31, 2026 and June 30, 2025 and six months ended June 30, 2026 and June 30, 2025. Cash cost, net of by-product credits may not calculate exactly based on amounts presented in the tables below due to rounding.

Consolidated

Three months ended

Six months ended

(in thousands)

Jun. 30, 2026

Mar. 31, 2026

Jun. 30, 2025

Jun. 30, 2026

Jun. 30, 2025

Peru

42,871

45,356

47,863

88,227

92,601

Manitoba

5,216

5,589

3,554

10,805

11,202

British Columbia

14,231

10,628

14,626

24,859

30,490

Net pounds of copper produced¹

62,318

61,573

66,043

123,891

134,293

¹ Contained copper in concentrate.

Consolidated	Three months ended
	Jun. 30, 2026				Mar. 31, 2026				Jun. 30, 2025
Cash cost per pound of copper produced	$millions		$/lb		$millions		$/lb		$ millions		$/lb
Cash cost, before by-product credits	285.0		4.57		271.5		4.41		245.6		3.72
By-product credits	(309.7	)	(4.97	)	(382.1	)	(6.21	)	(247.3	)	(3.74	)
Cash cost, net of by-product credits	(24.7	)	(0.40	)	(110.6	)	(1.80	)	(1.7	)	(0.02	)

Consolidated	Six months ended
	Jun. 30, 2026				Jun. 30, 2025
Cash cost per pound of copper produced	$ millions		$/lb		$ millions		$/lb
Cash cost, before by-product credits	556.5		4.49		499.3		3.72
By-product credits	(691.8	)	(5.58	)	(532.0	)	(3.96	)
Cash cost, net of by-product credits	(135.3	)	(1.09	)	(32.7	)	(0.24	)

Consolidated	Three months ended
	Jun. 30, 2026				Mar. 31, 2026		Jun. 30, 2025
Cash cost per pound of copper produced	$ millions		$/lb		$ millions	$/lb	$ millions	$/lb
Mining	117.0		1.88		93.0	1.51	85.8	1.30
Milling	94.4		1.51		91.2	1.48	92.6	1.40
G&A	52.2		0.84		61.6	1.00	43.1	0.66
Onsite costs	263.6		4.23		245.8	3.99	221.5	3.36
Treatment & refining	(0.1	)	(0.01	)	3.1	0.05	3.3	0.05
Freight & other	21.5		0.35		22.6	0.37	20.8	0.31
Cash cost, before by-product credits	285.0		4.57		271.5	4.41	245.6	3.72

Consolidated

Six months ended

Jun. 30, 2026

Jun. 30, 2025

Cash cost per pound of copper produced

$ millions

$/lb

$ millions

$/lb

Mining

210.0

1.69

177.0

1.32

Milling

185.6

1.50

173.2

1.29

G&A

113.8

0.92

86.7

0.64

Onsite costs

509.4

4.11

436.9

3.25

Treatment & refining

3.0

0.02

17.3

0.13

Freight & other

44.1

0.36

45.1

0.34

Cash cost, before by-product credits

556.5

4.49

499.3

3.72

Consolidated	Three months ended
	Jun. 30, 2026			Mar. 31, 2026			Jun. 30, 2025
Supplementary cash cost information	$ millions		$/lb ¹	$ millions		$/lb ¹	$ millions		$/lb ¹
By-product credits²:
Zinc	9.2		0.15	12.4		0.20	7.3		0.11
Gold³	242.6		3.89	297.4		4.83	195.8		2.96
Silver³	35.4		0.57	43.4		0.71	23.4		0.35
Molybdenum & other	22.5		0.36	28.9		0.47	20.8		0.32
Total by-product credits	309.7		4.97	382.1		6.21	247.3		3.74
Reconciliation to IFRS:
Cash cost, net of by-product credits	(24.7	)		(110.6	)		(1.7	)
By-product credits	309.7			382.1			247.3
Treatment and refining charges	0.1			(3.1	)		(3.3	)
Inventory adjustments	0.9			-			3.5
Share-based compensation expense	1.2			2.9			0.9
Change in product inventory	(17.3	)		13.0			11.4
Royalties and statutory contributions⁵	3.6			5.1			2.2
Overhead costs incurred during Manitoba temporary suspension (cash)	-			-			3.2
Depreciation and amortization⁴	88.8			99.9			96.4
Cost of sales⁶	362.3			389.3			359.9

¹Per pound of copper produced.

²By-product credits are computed as revenue per financial statements, including amortization of deferred revenue and pricing and volume adjustments. For more information, please see the realized price reconciliation table on page 31 of this MD&A for these figures.

³ Gold and silver by-product credits do not include variable consideration adjustments with respect to stream arrangements. Variable consideration adjustments are cumulative adjustments to gold and silver stream deferred revenue primarily associated with the net change in mineral reserves and resources or amendments to the mine plan that would change the total expected deliverable ounces under the precious metal streaming arrangement. For the three months ended June 30, 2026 the variable consideration adjustments amounted to $nil (three months ended June 30, 2025 - $nil and March 31, 2026 - loss of $0.1 million).

⁴Depreciation is based on concentrate sold.

⁵ Certain of Hudbay's properties are subject to royalty arrangements based on mineral production at the properties. Royalties include net smelter return royalty and price participation agreements.

⁶ As per consolidated interim financial statements.

Consolidated

Six months ended

Jun. 30, 2026

Jun. 30, 2025

Supplementary cash cost information

$ millions

$/lb¹

$ millions

$/lb¹

By-product credits²:

Zinc

21.6

0.17

21.1

0.16

Gold³

540.0

4.36

421.2

3.13

Silver³

78.8

0.64

49.5

0.37

Molybdenum & other

51.4

0.41

40.2

0.30

Total by-product credits

691.8

5.58

532.0

3.96

Reconciliation to IFRS:

Cash cost, net of by-product credits

(135.3

)

(32.7

)

By-product credits

691.8

532.0

Treatment and refining charges

(3.0

)

(17.3

)

Inventory adjustments

0.9

4.7

Share-based compensation expense

4.1

1.6

Change in product inventory

(4.3

)

23.4

Royalties and statutory contributions⁵

8.7

4.1

Overhead costs incurred during Manitoba temporary suspension (cash)

3.2

Depreciation and amortization⁴

188.7

204.5

Cost of sales⁶

751.6

723.5

¹Per pound of copper produced.

³ Gold and silver by-product credits do not include variable consideration adjustments with respect to stream arrangements. Variable consideration adjustments are cumulative adjustments to gold and silver stream deferred revenue primarily associated with the net change in mineral reserves and resources or amendments to the mine plan that would change the total expected deliverable ounces under the precious metal streaming arrangement. For the six months ended June 30, 2026 the variable consideration adjustments amounted to a gain of $0.1 million (six months ended June 30, 2025 - gain of $9.9 million).

⁴Depreciation is based on concentrate sold.

⁵ Certain of Hudbay's properties are subject to royalty arrangements based on mineral production at the properties. Royalties include net smelter return royalty and price participation agreements.

⁶ As per consolidated interim financial statements.

Peru

Three months ended

Six months ended

(in thousands)

Jun. 30, 2026

Mar. 31, 2026

Jun. 30, 2025

Jun. 30, 2026

Jun. 30, 2025

Net pounds of copper produced¹

42,871

45,356

47,863

88,227

92,601

¹Contained copper in concentrate.

Peru	Three months ended
	Jun. 30, 2026				Mar. 31, 2026				Jun. 30, 2025
Cash cost per pound of copper produced	$ millions		$/lb		$ millions		$/lb		$ millions		$/lb
Mining	42.2		0.98		34.5		0.76		28.1		0.59
Milling	50.9		1.19		43.4		0.96		57.8		1.21
G&A	25.4		0.59		33.2		0.73		23.2		0.48
Onsite costs	118.5		2.76		111.1		2.45		109.1		2.28
Treatment & refining	(0.5	)	(0.01	)	(1.6	)	(0.04	)	(0.1	)	0.00
Freight & other	12.7		0.30		14.1		0.31		12.4		0.25
Cash cost, before by-product credits	130.7		3.05		123.6		2.72		121.4		2.53
By-product credits	(59.7	)	(1.39	)	(91.8	)	(2.02	)	(51.8	)	(1.08	)
Cash cost, net of by-product credits	71.0		1.66		31.8		0.70		69.6		1.45

Peru	Six months ended
	Jun. 30, 2026				Jun. 30, 2025
Cash cost per pound of copper produced	$ millions		$/lb		$ millions		$/lb
Mining	76.7		0.87		59.1		0.64
Milling	94.3		1.07		102.2		1.10
G&A	58.6		0.66		45.7		0.50
Onsite costs	229.6		2.60		207.0		2.24
Treatment & refining	(2.1	)	(0.02	)	6.6		0.07
Freight & other	26.8		0.30		27.6		0.30
Cash cost, before by-product credits	254.3		2.88		241.2		2.61
By-product credits	(151.5	)	(1.71	)	(122.0	)	(1.32	)
Cash cost, net of by-product credits	102.8		1.17		119.2		1.29

Peru	Three months ended
	Jun. 30, 2026			Mar. 31, 2026		Jun. 30, 2025
Supplementary cash cost information	$ millions		$/lb ¹	$ millions	$/lb ¹	$ millions	$/lb ¹
By-product credits²:
Gold³	16.3		0.38	44.9	0.99	17.3	0.36
Silver³	21.0		0.49	22.9	0.50	13.7	0.29
Molybdenum	22.4		0.52	24.0	0.53	20.8	0.43
Total by-product credits	59.7		1.39	91.8	2.02	51.8	1.08
Reconciliation to IFRS:
Cash cost, net of by-product credits	71.0			31.8		69.6
By-product credits	59.7			91.8		51.8
Treatment and refining charges	0.5			1.6		0.1
Inventory adjustments	-			-		1.1
Share-based compensation expenses	0.2			0.5		0.2
Change in product inventory	(20.3	)		7.6		4.0
Royalties and statutory contributions	1.3			1.9		1.0
Depreciation and amortization⁴	45.4			61.4		56.0
Cost of sales⁵	157.8			196.6		183.8

¹Per pound of copper produced.

²By-product credits are computed as revenue per financial statements, including amortization of deferred revenue and pricing and volume adjustments.

³Gold and silver by-product credits do not include variable consideration adjustments with respect to stream arrangements.

⁴Depreciation is based on concentrate sold.

⁵ As per the consolidated interim financial statements.

Peru

Six months ended

Jun. 30, 2026

Jun. 30, 2025

Supplementary cash cost information

$ millions

$/lb ¹

$ millions

$/lb ¹

By-product credits²:

Gold³

61.2

0.69

52.3

0.56

Silver³

43.9

0.50

29.3

0.32

Molybdenum

46.4

0.53

40.4

0.44

Total by-product credits

151.5

1.72

122.0

1.32

Reconciliation to IFRS:

Cash cost, net of by-product credits

102.8

119.2

By-product credits

151.5

122.0

Treatment and refining charges

2.1

(6.6

)

Inventory adjustments

1.5

Share-based compensation expenses

0.7

0.3

Change in product inventory

(12.7

)

17.8

Royalties and statutory contributions

3.2

2.1

Depreciation and amortization⁴

106.8

124.2

Cost of sales⁵

354.4

380.5

¹Per pound of copper produced.

²By-product credits are computed as revenue per financial statements, including amortization of deferred revenue and pricing and volume adjustments.

³Gold and silver by-product credits do not include variable consideration adjustments with respect to stream arrangements.

⁴Depreciation is based on concentrate sold.

⁵ As per the consolidated interim financial statements.

British Columbia

Three months ended

Six months ended

(in thousands)

Jun. 30, 2026

Mar. 31, 2026

Jun. 30, 2025

Jun. 30, 2026

Jun. 30, 2025

Net pounds of copper produced¹

14,231

10,628

14,626

24,859

30,490

¹Contained copper in concentrate.

British Columbia	Three months ended
	Jun. 30, 2026				Mar. 31, 2026				Jun. 30, 2025
Cash cost per pound of copper produced	$ millions		$/lb		$ millions		$/lb		$ millions		$/lb
Mining	31.3		2.20		16.2		1.53		24.2		1.65
Milling	27.2		1.91		31.5		2.96		21.4		1.46
G&A	7.9		0.56		8.4		0.79		6.1		0.42
Onsite costs	66.4		4.67		56.1		5.28		51.7		3.53
Treatment & refining	(0.6	)	(0.04	)	2.1		0.20		2.1		0.14
Freight & other	3.5		0.24		2.8		0.26		3.3		0.24
Cash cost, before by-product credits	69.3		4.87		61.0		5.74		57.1		3.91
By-product credits	(23.5	)	(1.65	)	(35.4	)	(3.33	)	(22.2	)	(1.52	)
Cash cost, net of by-product credits	45.8		3.22		25.6		2.41		34.9		2.39

British Columbia

Six months ended

Jun. 30, 2026

Jun. 30, 2025

Cash cost per pound of copper produced

$ millions

$/lb

$ millions

$/lb

Mining

47.5

1.91

46.1

1.51

Milling

58.7

2.36

43.2

1.42

G&A

16.3

0.66

12.4

0.41

Onsite costs

122.5

4.93

101.7

3.34

Treatment & refining

1.5

0.06

5.7

0.19

Freight & other

6.3

0.25

6.7

0.21

Cash cost, before by-product credits

130.3

5.24

114.1

3.74

By-product credits

(58.9

)

(2.37

)

(40.5

)

(1.33

)

Cash cost, net of by-product credits

71.4

2.87

73.6

2.41

British Columbia	Three months ended
	Jun. 30, 2026			Mar. 31, 2026			Jun. 30, 2025
Supplementary cash cost information	$ millions		$/lb ¹	$ millions		$/lb ¹	$ millions		$/lb ¹
By-product credits²:
Gold	20.7		1.45	30.6		2.88	19.8		1.35
Silver	2.8		0.20	4.8		0.45	2.4		0.17
Total by-product credits	23.5		1.65	35.4		3.33	22.2		1.52
Reconciliation to IFRS:
Cash cost, net of by-product credits	45.8			25.6			34.9
By-product credits	23.5			35.4			22.2
Treatment and refining charges	0.6			(2.1	)		(2.1	)
Inventory adjustments	-			-			1.4
Change in product inventory	(2.6	)		11.3			3.6
Share-based compensation expense	0.6			0.6			0.2
Royalties	2.3			3.2			1.2
Depreciation and amortization³	22.2			18.5			16.8
Cost of sales⁴	92.4			92.5			78.2

¹Per pound of copper produced.

²By-product credits are computed as revenue per financial statements, including amortization of deferred revenue and pricing and volume adjustments.

³Depreciation is based on concentrate sold.

⁴ As per consolidated interim financial statements.

British Columbia

Six months ended

Jun. 30, 2026

Jun. 30, 2025

Supplementary cash cost information

$ millions

$/lb ¹

$ millions

$/lb ¹

By-product credits²:

Gold

51.3

2.06

35.9

1.18

Silver

7.6

0.31

4.6

0.15

Total by-product credits

58.9

2.37

40.5

1.33

Reconciliation to IFRS:

Cash cost, net of by-product credits

71.4

73.6

By-product credits

58.9

40.5

Treatment and refining charges

(1.5

)

(5.7

)

Inventory adjustments

2.2

Change in product inventory

8.7

2.8

Share-based compensation expense

1.2

0.5

Royalties

5.5

2.0

Depreciation and amortization³

40.7

32.8

Cost of sales⁴

184.9

148.7

¹Per pound of copper produced.

²By-product credits are computed as revenue per financial statements, including amortization of deferred revenue and pricing and volume adjustments.

³Depreciation is based on concentrate sold.

⁴ As per consolidated interim financial statements.

Consolidated	Three months ended
	Jun. 30, 2026				Mar. 31, 2026				Jun. 30, 2025
All-in sustaining cash cost per pound of copper produced	$ millions		$/lb		$ millions		$/lb		$ millions		$/lb
Cash cost, net of by-product credits	(24.7	)	(0.40	)	(110.6	)	(1.80	)	(1.7	)	(0.02	)
Cash sustaining capital expenditures	107.9		1.73		105.2		1.71		108.3		1.64
Royalties and statutory contributions	3.6		0.06		5.1		0.08		2.2		0.03
Sustaining cash cost, net of by-product credits	86.8		1.39		(0.3	)	0.00		108.8		1.65
Corporate selling and administrative expenses & regional costs	22.0		0.35		38.1		0.62		22.1		0.33
Accretion and amortization of decommissioning and community agreements¹	3.6		0.06		6.5		0.11		3.2		0.05
All-in sustaining cash cost, net of by-product credits	112.4		1.80		44.3		0.73		134.1		2.03
Reconciliation to property, plant and equipment additions:
Property, plant and equipment additions	160.0				109.5				93.6
Capitalized stripping net additions	49.8				73.0				53.8
Total accrued capital additions	209.8				182.5				147.4
Less other non-sustaining capital costs²	129.7				95.5				58.8
Total sustaining capital costs	80.1				87.0				88.6
Capitalized lease & equipment financing cash payments - operating sites	15.2				15.1				13.4
LOM Community agreement cash payments	10.1				0.6				4.1
Accretion and amortization of decommissioning and restoration obligations ³	2.5				2.5				2.2
Cash sustaining capital expenditures	107.9				105.2				108.3

¹ Includes accretion of decommissioning liability relating to non-producing sites, and accretion and amortization of community agreements capitalized to Other assets.

²Other non-sustaining capital costs include Copper World capitalized costs, Cactus Project capitalized costs, capitalized interest, capitalized exploration, right-of-use lease asset additions, equipment financing asset additions, growth capital expenditures and reclassification related to capital spares.

³Includes amortization of decommissioning and restoration PP&E assets and accretion of decommissioning and restoration liabilities related to producing sites.

Consolidated

Six months ended

Jun. 30, 2026

Jun. 30, 2025

All-in sustaining cash cost per pound of copper produced

$ millions

$/lb

$ millions

$/lb

Cash cost, net of by-product credits

(135.3

)

(1.09

)

(32.7

)

(0.24

)

Cash sustaining capital expenditures

213.1

1.72

186.5

1.39

Royalties and statutory contributions

8.7

0.07

4.1

0.03

Sustaining cash cost, net of by-product credits

86.5

0.70

157.9

1.18

Corporate selling and administrative expenses & regional costs

60.1

0.49

37.4

0.27

Accretion and amortization of decommissioning and community agreements¹

10.1

0.08

5.2

0.04

All-in sustaining cash cost, net of by-product credits

156.7

1.26

200.5

1.49

Reconciliation to property, plant and equipment additions:

Property, plant and equipment additions

269.5

161.8

Capitalized stripping net additions

122.8

95.1

Total accrued capital additions

392.3

256.9

Less other non-sustaining capital costs²

225.2

105.8

Total sustaining capital costs

167.1

151.1

Capitalized lease & equipment financing cash payments - operating sites

30.3

26.2

LOM Community agreement cash payments

10.7

4.9

Accretion and amortization of decommissioning and restoration obligations ³

5.0

4.3

Cash sustaining capital expenditures

213.1

186.5

¹ Includes accretion of decommissioning liability relating to non-producing sites, and accretion and amortization of community agreements capitalized to Other assets.

²Other non-sustaining capital costs include Copper World capitalized costs, capitalized interest, capitalized exploration, right-of-use lease asset additions, equipment financing asset additions, growth capital expenditures and reclassification related to capital spares.

³Includes amortization of decommissioning and restoration PP&E assets and accretion of decommissioning and restoration liabilities related to producing sites.

Peru	Three months ended
	Jun. 30, 2026		Mar. 31, 2026		Jun. 30, 2025
Sustaining cash cost per pound of copper produced	$ millions	$/lb	$ millions	$/lb	$ millions	$/lb
Cash cost, net of by-product credits	71.0	1.66	31.8	0.70	69.6	1.45
Cash sustaining capital expenditures	43.8	1.02	30.7	0.69	55.1	1.15
Royalties and statutory contributions	1.3	0.03	1.9	0.04	1.0	0.03
Sustaining cash cost per pound of copper produced	116.1	2.71	64.4	1.43	125.7	2.63

Peru

Six months ended

Jun. 30, 2026

Jun. 30, 2025

Sustaining cash cost per pound of copper produced

$ millions

$/lb

$ millions

$/lb

Cash cost, net of by-product credits

102.8

1.17

119.2

1.29

Cash sustaining capital expenditures

74.5

0.84

90.4

0.98

Royalties and statutory contributions

3.2

0.04

2.1

0.02

Sustaining cash cost per pound of copper produced

180.5

2.05

211.7

2.29

British Columbia	Three months ended
	Jun. 30, 2026		Mar. 31, 2026		Jun. 30, 2025
Sustaining cash cost per pound of copper produced	$ millions	$/lb	$ millions	$/lb	$ millions	$/lb
Cash cost, net of by-product credits	45.8	3.22	25.6	2.41	34.9	2.39
Cash sustaining capital expenditures	40.6	2.85	54.2	5.10	39.6	2.71
Royalties and statutory contributions	2.3	0.16	3.2	0.30	1.2	0.08
Sustaining cash cost per pound of copper produced	88.7	6.23	83.0	7.81	75.7	5.18

British Columbia

Six months ended

Jun. 30, 2026

Jun. 30, 2025

Sustaining cash cost per pound of copper produced

$ millions

$/lb

$ millions

$/lb

Cash cost, net of by-product credits

71.4

2.87

73.6

2.41

Cash sustaining capital expenditures

94.8

3.81

67.4

2.21

Royalties and statutory contributions

5.5

0.23

2.0

0.07

Sustaining cash cost per pound of copper produced

171.7

6.91

143.0

4.69

Gold Cash Cost and Gold Sustaining Cash Cost

Cash cost per ounce of gold produced ("gold cash cost") is a non-GAAP measure that management uses as a key performance indicator to assess the performance of Hudbay's Manitoba operations. This alternative cash cost calculation designates gold as the primary metal of production as it represents a substantial component of revenues for Hudbay's Manitoba business unit and should therefore be less volatile over time than Manitoba cash cost per pound of copper. The calculation is presented in three manners:

- Gold cash cost, before by-product credits - This measure is gross of by-product revenues and is a function of the efforts and costs incurred to mine and process all ore mined. However, the measure divides this aggregate cost over only ounces of gold produced, the assumed primary metal of production. This measure is generally less volatile from period to period, as it is not affected by changes in the price received for by-product metals.

- Gold cash cost, net of by-product credits - In order to calculate the net cost to produce and sell gold, the net of by-product credits measure subtracts the revenues realized from the sale of the metals other than gold. The by-product revenues from copper, zinc, and silver are significant and are integral to the economics of Hudbay's Manitoba operation. The economics that support its decision to produce and sell gold would be different if Hudbay did not receive revenues from the other significant metals being extracted and processed. This measure provides management and investors with an indication of the minimum gold price consistent with positive operating margins, assuming realized by-product metal prices are consistent with those prevailing during the reporting period. It also serves as an important operating statistic that management and investors utilize to measure Hudbay's operating performance at its Manitoba operation versus that of its competitors. However, it is important to understand that if by-product metal prices decline alongside gold prices, the gold cash cost net of by-product credits would increase, requiring a higher gold price than that reported to maintain positive cash flows and operating margins.

- Gold sustaining cash cost, net of by-product credits - This measure is an extension of gold cash cost that includes cash sustaining capital expenditures, capitalized exploration, net smelter returns royalties, as well as accretion and amortization for expected decommissioning activities for producing assets. It does not include corporate selling and administrative expenses. It provides a more fulsome measurement of the cost of sustaining production than gold cash cost, which is focused on operating costs only.

The tables below present a detailed build-up of gold cash cost and gold sustaining cash cost, net of by-product credits, for the Manitoba business unit, and reconciliations between gold cash cost, net of by-product credits, to the most comparable IFRS measures of cost of sales for the three months ended June 30, and March 31, 2026 and June 30, 2025 and six months ended June 30, 2026 and 2025. Gold cash cost, net of by-product credits, may not calculate exactly based on amounts presented in the tables below due to rounding.

Manitoba

Three months ended

Six months ended

(in thousands)

Jun. 30, 2026

Mar. 31, 2026

Jun. 30, 2025

Jun. 30, 2026

Jun. 30, 2025

Net ounces of gold produced¹

40,344

47,743

43,235

88,087

103,589

¹ Contained gold in concentrate and doré.

Manitoba	Three months ended
	Jun. 30, 2026				Mar. 31, 2026				Jun. 30, 2025
Cash cost per ounce of gold produced	$ millions		$/oz¹		$ millions		$/oz¹		$ millions		$/oz¹
Mining	43.5		1,078		42.3		886		33.5		775
Milling	16.3		404		16.3		341		13.4		310
G&A	18.9		469		20.0		419		13.8		319
Onsite costs	78.7		1,951		78.6		1,646		60.7		1,404
Treatment & refining	1.0		25		2.6		55		1.3		30
Freight & other	5.3		131		5.7		119		5.1		118
Cash cost, before by-product credits	85.0		2,107		86.9		1,820		67.1		1,552
By-product credits	(53.7	)	(1,331	)	(67.4	)	(1,412	)	(36.4	)	(842	)
Gold cash cost, net of by-product credits	31.3		776		19.5		408		30.7		710

Manitoba

Six months ended

Jun. 30, 2026

Jun. 30, 2025

Cash cost per ounce of gold produced

$ millions

$/oz¹

$ millions

$/oz¹

Mining

85.8

974

71.8

693

Milling

32.6

370

27.8

268

G&A

38.9

442

28.6

277

Onsite costs

157.3

1,786

128.2

1,238

Treatment & refining

3.6

5.0

Freight & other

11.0

125

10.8

104

Cash cost, before by-product credits

171.9

1,952

144.0

1,390

By-product credits

(121.1

)

(1,375

)

(90.6

)

(875

)

Gold cash cost, net of by-product credits

50.8

577

53.4

515

Manitoba	Three months ended
Supplementary cash cost information	Jun. 30, 2026			Mar. 31, 2026			Jun. 30, 2025
	$ millions		$/oz ¹	$ millions		$/oz¹	$ millions		$/oz ¹
By-product credits²:
Copper	32.8		813	34.4		720	21.8		504
Zinc	9.2		228	12.4		260	7.3		169
Silver	11.6		288	15.7		329	7.3		169
Other	0.1		2	4.9		103	-		-
Total by-product credits	53.7		1,331	67.4		1,412	36.4		842
Reconciliation to IFRS:
Cash cost, net of by-product credits	31.3			19.5			30.7
By-product credits	53.7			67.4			36.4
Treatment and refining charges	(1.0	)		(2.6	)		(1.3	)
Share-based compensation expenses	0.4			1.8			0.5
Inventory adjustments	0.9			-			1.0
Change in product inventory	5.6			(5.9	)		3.8
Overhead costs incurred during Manitoba temporary suspension (cash)	-			-			3.2
Depreciation and amortization³	21.2			20.0			23.6
Cost of sales⁴	112.1			100.2			97.9

¹ Per ounce of gold produced.

²By-product credits are computed as revenue per financial statements, amortization of deferred revenue and pricing and volume adjustments.

³Depreciation is based on concentrate sold.

⁴ As per consolidated interim financial statements.

Manitoba

Six months ended

Supplementary cash cost information

Jun. 30, 2026

Jun. 30, 2025

$ millions

$/oz ¹

$ millions

$/oz ¹

By-product credits²:

Copper

67.2

763

54.1

522

Zinc

21.6

245

21.1

204

Silver

27.3

310

15.6

151

Other

5.0

(0.2

)

Total by-product credits

121.1

1,375

90.6

875

Reconciliation to IFRS:

Cash cost, net of by-product credits

50.8

53.4

By-product credits

121.1

90.6

Treatment and refining charges

(3.6

)

(5.0

)

Share-based compensation expenses

2.2

0.8

Inventory adjustments

0.9

1.0

Change in product inventory

(0.3

)

2.8

Overhead costs incurred during Manitoba temporary suspension (cash)

3.2

Depreciation and amortization³

41.2

47.5

Cost of sales⁴

212.3

194.3

¹ Per ounce of gold produced.

²By-product credits are computed as revenue per financial statements, amortization of deferred revenue and pricing and volume adjustments.

³Depreciation is based on concentrate sold.

⁴ As per consolidated interim financial statements.

Manitoba

Three months ended

Jun. 30, 2026

Mar. 31, 2026

Jun. 30, 2025

Sustaining cash cost per ounce of gold produced

$ millions

$/oz

$ millions

$/oz

$ millions

$/oz

Gold cash cost, net of by-product credits

31.3

776

19.5

408

30.7

710

Cash sustaining capital expenditures

23.5

582

20.3

425

13.6

315

Sustaining cash cost per ounce of gold produced

54.8

1,358

39.8

833

44.3

1,025

Manitoba

Six months ended

Jun. 30, 2026

Jun. 30, 2025

Sustaining cash cost per ounce of gold produced

$ millions

$/oz

$ millions

$/oz

Gold cash cost, net of by-product credits

50.8

577

53.4

515

Cash sustaining capital expenditures

43.8

497

28.7

278

Sustaining cash cost per ounce of gold produced

94.6

1,074

82.1

793

Combined Unit Cost

Combined unit cost ("unit cost") and zinc plant unit cost is a non-GAAP measure that management uses as a key performance indicator to assess the performance of Hudbay's mining and milling operations. Combined unit cost is calculated by dividing the cost of sales by mill throughput. This measure is utilized by management and investors to assess Hudbay's cost structure and margins and compare it to similar information provided by other companies in the industry. Unlike cash cost, this measure is not impacted by variability in by-product commodity prices since there are no by-product deductions; costs associated with profit-sharing and similar costs are excluded because of their correlation to external metal prices. In addition, the unit costs are reported in the functional currency of the operation which minimizes the impact of foreign currency fluctuations. In all, the unit cost measures provide an alternative perspective on operating cost performance with minimal impact from external market prices.

The tables below present a detailed combined unit cost for the Peru and Manitoba business units, and reconciliations between these measures to the most comparable IFRS measures of cost of sales for the three months ended June 30, 2026 and 2025 and March 31, 2026 and six months ended June 30, 2026 and 2025.

Peru	Three months ended						Six months ended
(in millions except ore tonnes milled and unit cost per tonne)	Jun. 30, 2026		Mar. 31, 2026		Jun. 30, 2025		Jun. 30, 2026		Jun. 30, 2025
Combined unit cost per tonne processed	Jun. 30, 2026		Mar. 31, 2026		Jun. 30, 2025		Jun. 30, 2026		Jun. 30, 2025
Mining	42.2		34.5		28.1		76.7		59.1
Milling	50.9		43.4		57.8		94.3		102.2
G&A¹	25.4		33.2		23.2		58.6		45.7
Less: Other G&A²	(8.4	)	(16.3	)	(6.4	)	(24.6	)	(14.3	)
Unit cost	110.1		94.8		102.7		205.0		192.7
Tonnes ore milled (in thousands)	7,828		8,164		7,559		15,991		15,673
Combined unit cost per tonne	14.06		11.61		13.59		12.82		12.29
Reconciliation to IFRS:
Unit cost	110.1		94.8		102.7		205.0		192.7
Freight & other	12.7		14.1		12.4		26.8		27.6
Other G&A	8.4		16.3		6.4		24.6		14.3
Share-based compensation expenses	0.2		0.5		0.2		0.7		0.3
Inventory adjustments	-		-		1.1		-		1.5
Change in product inventory	(20.3	)	7.6		4.0		(12.7	)	17.8
Royalties and statutory contributions	1.3		1.9		1.0		3.2		2.1
Depreciation and amortization	45.4		61.4		56.0		106.8		124.2
Cost of sales³	157.8		196.6		183.8		354.4		380.5

¹ G&A as per cash cost reconciliation above.

² Other G&A primarily includes profit sharing costs.

⁴ As per consolidated interim financial statements.

Manitoba	Three months ended						Six months ended
(in millions except tonnes ore milled and unit cost per tonne)	Jun. 30, 2026		Mar. 31, 2026		Jun. 30, 2025		Jun. 30, 2026		Jun. 30, 2025
Combined unit cost per tonne processed	Jun. 30, 2026		Mar. 31, 2026		Jun. 30, 2025		Jun. 30, 2026		Jun. 30, 2025
Mining	43.5		42.3		33.5		85.8		71.8
Milling	16.3		16.3		13.4		32.6		27.8
G&A¹	18.9		20.0		13.8		38.9		28.6
Less: Other G&A related to profit sharing costs	(9.6	)	(11.9	)	(7.2	)	(21.5	)	(14.4	)
Unit cost	69.1		66.7		53.5		135.8		113.8
USD/CAD implicit exchange rate	1.38		1.37		1.38		1.38		1.41
Unit cost - C$	95.6		91.5		73.9		187.1		160.4
Tonnes ore milled	318,514		360,384		307,138		678,898		711,548
Combined unit cost per tonne - C$	300		254		241		276		225
Reconciliation to IFRS:
Unit cost	69.1		66.7		53.5		135.8		113.8
Freight & other	5.3		5.7		5.1		11.0		10.8
Other G&A related to profit sharing	9.6		11.9		7.2		21.5		14.4
Share-based compensation expenses	0.4		1.8		0.5		2.2		0.8
Inventory adjustments	0.9		-		1.0		0.9		1.0
Change in product inventory	5.6		(5.9	)	3.8		(0.3	)	2.8
Overhead costs incurred during Manitoba temporary suspension (cash)	-		-		3.2		-		3.2
Depreciation and amortization	21.2		20.0		23.6		41.2		47.5
Cost of sales²	112.1		100.2		97.9		212.3		194.3

¹ G&A as per cash cost reconciliation above.

² As per consolidated interim financial statements.

British Columbia	Three months ended				Six months ended
(in millions except tonnes ore milled and unit cost per tonne)	Jun. 30, 2026		Mar. 31, 2026	Jun. 30, 2025	Jun. 30, 2026	Jun. 30, 2025
Combined unit cost per tonne processed	Jun. 30, 2026		Mar. 31, 2026	Jun. 30, 2025	Jun. 30, 2026	Jun. 30, 2025
Mining	31.3		16.2	24.2	47.5	46.1
Milling	27.2		31.5	21.4	58.7	43.2
G&A¹	7.9		8.4	6.1	16.3	12.4
Unit cost	66.4		56.1	51.7	122.5	101.7
USD/CAD implicit exchange rate	1.39		1.38	1.38	1.39	1.40
Unit cost - C$	92.3		77.7	71.1	170.0	142.2
Tonnes ore milled	3,616		3,078	2,900	6,694	5,661
Combined unit cost per tonne - C$	25.52		25.23	24.51	25.39	25.12
Reconciliation to IFRS:
Unit cost	66.4		56.1	51.7	122.5	101.7
Freight & other	3.5		2.8	3.3	6.3	6.7
Change in product inventory	(2.6	)	11.3	3.6	8.7	2.8
Shared based compensation	0.6		0.6	0.2	1.2	0.5
Inventory adjustments	-		-	1.4	-	2.2
Royalties	2.3		3.2	1.2	5.5	2.0
Depreciation and amortization	22.2		18.5	16.8	40.7	32.8
Cost of sales²	92.4		92.5	78.2	184.9	148.7

¹ G&A as per cash cost reconciliation above.

² As per consolidated interim financial statements.

ACCOUNTING CHANGES AND CRITICAL ESTIMATES

New standards and interpretations

For information on new standards and interpretations adopted and new standards issued but not yet effective, refer to note 3 of Hudbay's June 30, 2026 consolidated interim financial statements.

Estimates and judgements

The preparation of the consolidated interim financial statements in accordance with IFRS requires Hudbay to make judgements, estimates and assumptions that affect the application of accounting policies, reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the consolidated interim financial statements, and reported amounts of revenue and expenses during the reporting period. Actual results may differ from these estimates.

Hudbay reviews these estimates and underlying assumptions on an ongoing basis based on its experience and other factors, including expectations of future events that Hudbay believes to be reasonable under the circumstances. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected. Certain accounting estimates and judgements have been identified as being "critical" to the presentation of Hudbay's financial condition and results of operations because they require Hudbay to make subjective and/or complex judgments about matters that are inherently uncertain; or there is a reasonable likelihood that materially different amounts could be reported under different conditions or using different assumptions and estimates.

For more information on judgements and estimates, refer to note 2 of Hudbay's June 30, 2026 consolidated interim financial statements.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

Management is responsible for establishing and maintaining adequate internal control over financial reporting ("ICFR"). ICFR is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of consolidated interim financial statements for external purposes in accordance with IFRS.

Hudbay did not make any changes to ICFR during the three months ended June 30, 2026 that materially affected or are reasonably likely to materially affect Hudbay's ICFR.

NOTES TO READER

Forward-Looking Information

This MD&A contains forward-looking information within the meaning of applicable Canadian and United States securities legislation. All information contained in this MD&A, other than statements of current and historical fact, is forward-looking information. Often, but not always, forward-looking information can be identified by the use of words such as "plans", "expects", "budget", "guidance", "scheduled", "estimates", "forecasts", "strategy", "target", "intends", "objective", "goal", "understands", "anticipates" and "believes" (and variations of these or similar words) and statements that certain actions, events or results "may", "could", "would", "should", "might" "occur" or "be achieved" or "will be taken" (and variations of these or similar expressions). All of the forward-looking information in this MD&A is qualified by this cautionary note.

Forward-looking information includes, but is not limited to, statements with respect to Hudbay's production, cost and capital and exploration expenditure guidance, Hudbay's ability to advance and complete the multi-year optimization of the Copper Mountain mine in British Columbia, including with respect to the primary SAG mill repairs and related ramp-up plans, the implementation of stripping strategies and the expected benefits therefrom, the expected timing and benefits of British Columbia growth initiatives, including with respect to the development timelines associated with New Ingerbelle and any challenges to the New Ingerbelle permits (including LSIB's recent application for judicial review), the estimated timelines and pre-requisites for sanctioning the Copper World project, including the completion and anticipated results of (and costs associated with) the DFS and the potential timing of a project sanctioning decision, expectations regarding the benefits of (and costs associated with) sanctioning of the Copper World project, expectations regarding the potential impact of recent policy decisions from the United States government, the benefits, timing and consummation of the definitive agreement with Wheaton Precious Metals Corp. ("Wheaton") in respect of the enhanced precious metals stream at Copper World, the expected benefits of Manitoba growth initiatives, including the use of the exploration drift at the 1901 deposit and the potential utilization of excess capacity at the Stall mill, the ability for Hudbay to complete mill throughput enhancements at its operating business units in Peru, British Columbia and Manitoba, Hudbay's future deleveraging strategies and Hudbay's ability to deleverage and repay debt as needed, expectations regarding the benefits of the ASCU Transaction and the acquisition of the Cactus project, expectations regarding the timing and costs associated with the updated Cactus PFS, expectations regarding Hudbay's cash balance and liquidity and related cash management strategies, expectations regarding Hudbay's capital planning strategies, including but not limited to Hudbay's enhanced Capital Allocation Framework, expectations regarding sustaining capital projects, including but not limited to the construction of a cyanide recycling initiative at the New Britannia mill and construction of a dam lift at the Anderson Tailings Impoundment Area, expectations regarding tax synergies, expectations regarding the ability to conduct exploration work and execute on exploration programs on its properties and to advance related drill plans, Hudbay's evaluation and assessment of opportunities to reprocess tailings using various metallurgical technologies, the anticipated impact of brownfield and greenfield growth projects on Hudbay's performance, anticipated exploration and expansion opportunities and extension of mine life in Snow Lake and Hudbay's ability to find a new anchor deposit near Hudbay's Snow Lake operations, anticipated future drill programs and exploration activities and any results expected therefrom, potential updates to Rockcliff's prior mineral resource estimate for the Talbot project, the enhancement of stakeholder engagement and advancement of a pre-feasibility study and related test work at the Mason copper project in Nevada, expectations regarding the timing and costs associated with the Mason PFS, anticipated mine plans, anticipated metals prices and the anticipated sensitivity of Hudbay's financial performance to metals prices, events that may affect Hudbay's operations and development projects, anticipated cash flows from operations and related liquidity requirements, the ability to successfully obtain proceeds from insurance claims, the ability to achieve Hudbay's climate change goals and initiatives, the anticipated effect of external factors on revenue, such as commodity prices, estimation of mineral reserves and resources, mine life projections, reclamation costs, economic outlook, government regulation of mining operations, and business and acquisition strategies. Forward-looking information is not, and cannot be, a guarantee of future results or events. Forward-looking information is based on, among other things, opinions, assumptions, estimates and analyses that, while considered reasonable by Hudbay at the date the forward-looking information is provided, inherently are subject to significant risks, uncertainties, contingencies and other factors that may cause actual results and events to be materially different from those expressed or implied by the forward-looking information.

The material factors or assumptions that Hudbay has identified and were applied in drawing conclusions or making forecasts or projections set out in the forward-looking information include, but are not limited to:

- the ability to achieve production, cost and capital and exploration expenditure guidance;

- no significant interruptions to Hudbay's operations due to social or political unrest in the regions Hudbay operates, including the navigation of the complex political and social environment in Peru and the resolution of grievances raised by local communities and their residents;

- the ability to consummate the definitive agreement with Wheaton in respect of the enhanced precious metals stream at Copper World;

- no interruptions to Hudbay's plans for advancing the Copper World project, including with respect to the completion of the DFS, timing of a project sanctioning decision, and any successful challenges to the Copper World permits;

- no interruptions to Hudbay's plans for advancing New Ingerbelle, including with respect to any challenges to the New Ingerbelle permits;

- Hudbay's ability to successfully advance and complete the optimization of the Copper Mountain operations, and develop and maintain good relations with key stakeholders;

- the ability to execute on its exploration plans and to advance related drill plans;

- the ability to advance the exploration program at the Maria Reyna and Caballito properties;

- the success of mining, processing, exploration and development activities;

- the scheduled maintenance and availability of Hudbay's processing facilities;

- the accuracy of geological, mining and metallurgical estimates;

- anticipated metals prices and the costs of production;

- the supply and demand for metals Hudbay produces;

- the supply and availability of all forms of energy and fuels at reasonable prices;

- no significant unanticipated operational or technical difficulties;

- no significant interruptions to operations due to adverse effects from extreme weather events, including forest fires that have affected and may continue to affect the regions in which Hudbay operates;

- the execution of Hudbay's business and growth strategies, including the success of its strategic investments and initiatives;

- the availability of additional financing, if needed;

- the ability to deleverage and repay debt, as needed;

- the ability to complete project targets on time and on budget and other events that may affect Hudbay's ability to develop Hudbay's projects;

- the timing and receipt of various regulatory and governmental approvals;

- the availability of personnel for Hudbay's exploration, development and operational projects and ongoing employee relations;

- maintaining good relations with the employees at Hudbay's operations;

- maintaining good relations with the labour unions that represent certain of Hudbay employees in Manitoba and Peru;

- maintaining good relations with the communities in which Hudbay operates, including the neighbouring Indigenous communities and local governments;

- no significant unanticipated challenges with stakeholders at Hudbay's various projects;

- no significant unanticipated events or changes relating to regulatory, environmental, health and safety matters;

- no contests over title to Hudbay's properties, including as a result of rights or claimed rights of Indigenous peoples or challenges to the validity of Hudbay's unpatented mining claims;

- the timing and possible outcome of pending litigation and no significant unanticipated litigation;

- certain tax matters, including, but not limited to current tax laws and regulations, changes in taxation policies and the refund of certain value added taxes from the Canadian and Peruvian governments; and

- no significant and continuing adverse changes in general economic conditions or conditions in the financial markets (including commodity prices and foreign exchange rates).

The risks, uncertainties, contingencies and other factors that may cause actual results to differ materially from those expressed or implied by the forward-looking information may include, but are not limited to, risks related to the failure to effectively advance and complete the optimization of the Copper Mountain mine operations including with respect to the primary SAG mill repairs and related ramp-up plans, political and social risks in the regions Hudbay operates, including the complex political and social environment in Peru and potential disruptions to operations arising from community protests and grievances, risks generally associated with the mining industry and the current geopolitical environment, including future commodity prices, the potential implementation or expansion of tariffs, currency and interest rate fluctuations, energy and consumable prices, supply chain constraints and general cost escalation in the current inflationary environment, uncertainties related to the development and operation of Hudbay's projects, the risk of an indicator of impairment or impairment reversal relating to a material mineral property, risks associated with the development of new projects, risks associated with acquisitions, investments and other strategic transactions including but not limited to the recent acquisition of ASCU, risks related to the Copper World project, including the risk of capital cost escalation, risks related to ongoing litigation in respect of the project's air permit and certain land rights, risks from community opposition, project delivery risks, joint venture risks and financing risks, risks related to the Lalor mine plan, including the ability to convert inferred mineral resource estimates to higher confidence categories, dependence on key personnel and employee and union relations, risks related to political or social instability, unrest or change, risks in respect of Indigenous and community relations, rights and title claims, operational risks and hazards, including the cost of maintaining and upgrading Hudbay's tailings management facilities and any unanticipated environmental, industrial and geological events and developments and the inability to insure against all risks (including any unanticipated significant interruptions to operations due to adverse effects from extreme weather events), failure of plant, equipment, processes, transportation and other infrastructure to operate as anticipated, compliance with government and environmental regulations, including permitting requirements and anti-bribery legislation, depletion of Hudbay's reserves, volatile financial markets and interest rates that may affect Hudbay's ability to obtain additional financing on acceptable terms, the failure to obtain required approvals or clearances from government authorities on a timely basis, uncertainties related to the geology, continuity, grade and estimates of mineral reserves and resources, and the potential for variations in grade and recovery rates, uncertain costs of reclamation activities, Hudbay's ability to comply with Hudbay's pension and other post-retirement obligations, Hudbay's ability to abide by the covenants in Hudbay's debt instruments and other material contracts, tax refunds, hedging transactions, cybersecurity risks and risks related to the reliability and security of Hudbay's information technology and operational technology systems, including risks arising from cyber-attacks ransomware, phishing and other malware, risks associated with the use of artificial intelligence technologies, as well as the risks discussed under the heading "Risk Factors" in Hudbay's most recent Annual Information Form which is available on the Company's SEDAR+ profile at www.sedarplus.ca and the Company's EDGAR profile at www.sec.gov.

Should one or more risk, uncertainty, contingency or other factor materialize or should any factor or assumption prove incorrect, actual results could vary materially from those expressed or implied in the forward-looking information. Accordingly, you should not place undue reliance on forward-looking information. Hudbay does not assume any obligation to update or revise any forward-looking information after the date of this MD&A or to explain any material difference between subsequent actual events and any forward-looking information, except as required by applicable law.

Note to United States Investors

This MD&A has been prepared in accordance with the requirements of the securities laws in effect in Canada, which may differ materially from the requirements of United States securities laws applicable to U.S. issuers.

Qualified Persons and NI 43-101

The technical and scientific information in this MD&A related to Hudbay's material mineral projects other than the Copper Mountain mine has been approved by Olivier Tavchandjian, P. Geo, Senior Vice President, Exploration and Technical Services. Mr. Tavchandjian is a qualified person pursuant to National Instrument 43-101 - Standards of Disclosure for Mineral Projects ("NI 43-101").

The technical and scientific information in this MD&A related to the Copper Mountain mine has been approved by Marc-Andre Brulotte, P. Geo, Executive Director, Global Mineral Resource Evaluation. Mr. Brulotte is a qualified person pursuant to NI 43-101.

For a description of the key assumptions, parameters and methods used to estimate mineral reserves and resources at Hudbay's material mineral properties, as well as data verification procedures and a general discussion of the extent to which the estimates of scientific and technical information may be affected by any known environmental, permitting, legal title, taxation, sociopolitical, marketing or other relevant factors, please see the technical reports for Hudbay's material properties as filed by the Company on SEDAR+ at www.sedarplus.ca and EDGAR at www.sec.gov.

SUMMARY OF HISTORICAL RESULTS

The following unaudited tables set out a summary of quarterly and annual results for the Company.

		Q2 2026			Q1 2026			2025⁴			Q4 2025			Q3 2025			Q2 2025			Q1 2025			2024 ⁴		Q4 2024		Q3 2024		Q2 2024
Consolidated Financial Condition ($ millions)
Cash and cash equivalents and short-term investment	$	890.9		$	1,003.8		$	568.9		$	568.9		$	611.1		$	625.5		$	582.6		$	581.8	$	581.8	$	483.3	$	0.5
Total long-term debt		860.2			1,009.4			1,008.6			1,008.6			1,047.0			1,059.6			1,108.7			1,107.5		1,107.5		1,108.9		1.2
Net debt¹		(80.5	)		5.6			439.7			439.7			435.9			434.1			526.1			525.7		525.7		625.6		0.6
Free cash flow		101.8			102.3			380.0			225.0			(16.1	)		86.7			84.4			350.5		146.9		86.3		30.6
Consolidated Financial Performance ($ millions except per share amounts)
Revenue	$	631.3		$	757.3		$	2,211.0		$	732.9		$	346.8		$	536.4		$	594.9		$	2,021.2	$	584.9	$	485.8	$	425.5
Cost of sales		362.3			389.3			1,467.8			462.8			281.5			359.9			363.6			1,467.4		400.5		346.0		347.9
Earnings (loss) before tax		240.4			339.0			912.0			257.1			330.5			153.1			171.3			251.6		103.7		79.7		0.4
Net earnings (loss)		138.1			191.5			564.3			128.0			222.4			114.7			99.2			67.8		19.3		50.3		(20.3	)
Net earnings (loss) attributable to owners¹		137.4			190.4			568.5			128.0			222.4			117.7			100.4			76.7		21.2		49.7		(16.5	)
Basic and diluted earnings (loss) per share attributable to owners	$	0.34		$	0.48		$	1.44		$	0.32		$	0.56		$	0.30		$	0.25		$	0.20	$	0.05	$	0.13	$	(0.04	)
Adjusted earnings (loss) per share attributable to owners ¹	$	0.28		$	0.40		$	0.67		$	0.22		$	0.03		$	0.19		$	0.24		$	0.48	$	0.18	$	0.13	$	0.00
Operating cash flow before change in non-cash working capital		210.1			208.7			764.3			336.9			70.3			193.9			163.5			691.1		231.5		188.3		123.7
Adjusted EBITDA ¹		321.2			421.9			1,060.9			385.9			142.6			245.2			287.2			823.3		257.3		206.0		145.0
Consolidated Operational Performance
Contained metal in concentrate and doré produced ²
Copper		28,267			27,929			118,188			33,069			24,205			29,956			30,958			137,943		43,262		31,354		28,578
Gold		51,234			61,700			267,934			84,298			53,581			56,271			73,784			332,240		94,161		89,073		58,614
Silver		845,161			787,449			3,468,143			1,002,985			730,394			814,989			919,775			3,983,851		1,311,658		985,569		738,707
Zinc		4,760			4,565			17,646			5,703			548			5,130			6,265			33,339		8,385		8,069		8,087
Molybdenum		277			380			1,282			325			185			375			397			1,323		195		362		369
Payable metal in concentrate and doré sold
Copper		23,780			29,544			114,534			34,132			18,280			30,354			31,768			125,094		37,927		27,760		25,799
Gold		56,266			66,562			260,261			84,424			38,279			62,466			75,092			335,342		92,734		73,232		61,295
Silver		674,490			923,051			3,190,552			871,006			418,418			894,160			1,006,968			3,549,816		1,150,518		663,413		667,036
Zinc ³		2,635			3,897			15,152			3,972			3,452			2,871			4,857			25,120		5,261		8,607		5,133
Molybdenum		298			375			1,334			190			269			427			448			1,287		182		343		347
Cash cost ¹	$	(0.40	)	$	(1.80	)	$	(0.22	)	$	(0.63	)	$	0.42		$	(0.02	)	$	(0.45	)	$	0.46	$	0.45	$	0.18	$	1.14
Sustaining cash cost ¹	$	1.39		$	0.00		$	1.30		$	0.94		$	2.09		$	1.65		$	0.72		$	1.62	$	1.37	$	1.71	$	2.65
All-in sustaining cash cost ¹	$	1.80		$	0.73		$	1.74		$	1.43		$	2.78		$	2.03		$	0.97		$	1.88	$	1.53	$	1.95	$	3.07

¹Net debt, adjusted earnings (loss) per share attributable to owners, adjusted EBITDA, cash cost, sustaining cash cost and all-in sustaining cash cost per pound of copper produced, net of by-product credits, are non-GAAP financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see discussion under the "Non-GAAP Financial Performance Measures" section of this MD&A. The above table sets forth selected non-GAAP financial performance measures for each of the Company's nine most recently completed quarters and three most recently completed years; detailed reconciliations for non-comparable prior periods can be found in Hudbay's MD&A for these prior periods in the "Non-GAAP Financial Performance Measures" section of these documents.

² Metal reported in concentrate is prior to deductions associated with smelter contract terms and includes other secondary products.

³ Includes refined zinc metal sold.

⁴Annual consolidated results may not calculate based on amounts presented in this table due to rounding.

			Q2 2026		Q1 2026		2025⁴		Q4 2025		Q3 2025		Q2 2025		Q1 2025		2024 ⁴		Q4 2024		Q3 2024		Q2 2024
Peru Operations
Constancia ore mined¹	tonnes		10,962,399		10,701,375		21,539,089		5,610,915		564,579		6,735,316		8,628,279		15,046,190		4,186,058		3,022,931		5,277,654
Copper	%		0.28		0.29		0.31		0.31		0.25		0.34		0.28		0.34		0.40		0.36		0.29
Gold	g/tonne		0.04		0.03		0.03		0.03		0.02		0.03		0.03		0.04		0.04		0.04		0.03
Silver	g/tonne		3.68		3.11		3.18		3.27		1.92		3.26		3.14		3.08		3.88		3.20		2.50
Molybdenum	%		0.01		0.01		0.02		0.01		0.01		0.02		0.02		0.01		0.02		0.02		0.01
Pampacancha ore mined¹	tonnes		-		-		9,563,442		4,152,000		4,260,081		762,172		389,189		9,317,499		4,037,264		1,777,092		1,288,789
Copper	%		-		-		0.40		0.43		0.38		0.26		0.44		0.55		0.63		0.48		0.41
Gold	g/tonne		-		-		0.29		0.27		0.31		0.24		0.26		0.32		0.38		0.27		0.20
Silver	g/tonne		-		-		4.78		4.84		4.87		4.59		3.68		5.61		6.43		6.23		3.83
Molybdenum	%		-		-		0.01		0.01		0.01		0.01		0.01		0.01		0.00		0.01		0.02
Strip Ratio			0.88		0.83		1.04		0.57		1.38		1.47		1.02		1.78		1.22		2.62		1.74
Ore milled	tonnes		7,827,509		8,163,847		30,292,668		7,627,853		6,991,744		7,559,047		8,114,024		31,933,624		7,999,453		8,137,248		7,718,962
Copper	%		0.30		0.31		0.33		0.39		0.31		0.34		0.30		0.36		0.48		0.32		0.30
Gold	g/tonne		0.04		0.06		0.11		0.18		0.16		0.05		0.05		0.14		0.20		0.11		0.07
Silver	g/tonne		3.75		3.09		3.72		4.19		3.94		3.58		3.22		3.84		5.28		3.70		2.85
Molybdenum	%		0.01		0.01		0.01		0.01		0.01		0.01		0.01		0.01		0.01		0.01		0.01
Copper recovery	%		82.0		81.5		84.3		84.5		83.2		84.5		84.6		85.0		87.8		82.6		83.1
Gold recovery	%		48.8		59.9		69.2		74.7		72.1		56.0		56.5		70.7		73.3		68.1		61.4
Silver recovery	%		59.9		65.4		66.7		71.1		65.2		63.5		66.0		68.8		71.4		67.0		63.9
Molybdenum recovery	%		39.9		36.0		37.4		38.8		33.9		38.7		35.7		41.7		37.1		39.0		46.3
Contained metal in concentrate
Copper	tonnes		19,446		20,573		85,155		25,038		18,114		21,710		20,293		99,001		33,988		21,220		19,217
Gold	ounces		5,282		8,770		74,480		32,865		26,380		7,366		7,869		98,226		38,079		20,331		10,672
Silver	ounces		564,505		531,199		2,415,134		731,017		577,446		551,979		554,692		2,708,262		969,502		648,209		450,833
Molybdenum	tonnes		277		380		1,282		325		185		375		397		1,323		195		362		369
Payable metal sold
Copper	tonnes		15,755		21,056		84,438		28,361		11,769		21,418		22,890		88,138		28,775		18,803		16,806
Gold	ounces		4,042		15,162		71,755		37,874		9,798		9,721		14,362		103,364		37,459		9,795		13,433
Silver	ounces		418,640		676,119		2,239,832		650,384		258,215		616,578		714,654		2,343,820		824,613		365,198		400,302
Molybdenum	tonnes		298		375		1,334		190		269		427		448		1,287		182		343		347
Unit cost ^2,3	$/tonne	$	14.06	$	11.61	$	13.02	$	14.51	$	13.03	$	13.59	$	11.09	$	12.91	$	15.25	$	12.78	$	12.68
Peru cash cost³	$/lb	$	1.66	$	0.70	$	1.08	$	0.57	$	1.30	$	1.45	$	1.11	$	1.18	$	1.00	$	1.80	$	1.78
Peru sustaining cash cost³	$/lb	$	2.71	$	1.43	$	2.02	$	1.53	$	2.11	$	2.63	$	1.92	$	1.86	$	1.48	$	2.78	$	2.60

¹ Reported tonnes and grade for ore mined are estimates based on mine plan assumptions and may not fully reconcile to ore milled.

²Reflects combined mine, mill and G&A costs per tonne of ore milled. Reflects the deduction of expected capitalized stripping costs.

³Combined unit costs, cash cost, and sustaining cash cost per pound of copper produced, net of by-product credits, are non-GAAP financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-GAAP Financial Performance Measures" section of this MD&A. The above table sets forth selected non-GAAP financial performance measures for each of the Company's nine most recently completed quarters and three most recently completed years; detailed reconciliations for non-comparable prior periods can be found in Hudbay's MD&A for these prior periods in the "Non-GAAP Financial Performance Measures" section of these documents.

⁴Annual consolidated results may not calculate based on amounts presented in this table due to rounding.

Manitoba Operations
Total ore mined²	tonnes	321,719	349,980	1,180,121	353,819	139,006	303,062	384,234	1,626,935	422,454	411,295	385,478
Gold	g/tonne	4.41	4.72	5.35	5.51	5.42	4.97	5.46	4.68	4.61	5.45	3.75
Copper	%	0.84	0.80	0.79	0.82	0.67	0.61	0.95	0.85	0.95	0.91	0.69
Zinc	%	2.25	2.10	2.41	2.55	1.93	2.46	2.42	2.84	2.95	2.73	2.76
Silver	g/tonne	28.33	26.22	30.43	29.52	31.57	29.94	31.23	27.14	31.91	30.45	22.29
Stall Concentrator:
Ore milled	tonnes	148,037	178,981	572,704	169,274	43,940	144,204	215,286	893,510	222,004	222,621	229,527
Gold	g/tonne	3.30	3.26	3.45	3.24	3.10	3.19	3.86	3.42	3.36	4.23	3.02
Copper	%	0.66	0.53	0.67	0.69	0.56	0.56	0.76	0.71	0.73	0.89	0.59
Zinc	%	3.81	3.22	3.90	4.32	3.61	4.20	3.44	4.33	4.62	4.12	4.05
Silver	g/tonne	27.46	29.68	28.31	24.97	31.04	29.55	29.53	26.54	29.90	30.20	21.74
Gold recovery	%	70.8	73.5	70.1	71.3	72.6	67.9	70.1	68.6	69.6	70.5	65.5
Copper recovery	%	83.7	85.9	86.7	86.5	83.4	84.7	88.3	87.4	84.4	88.3	85.4
Zinc recovery	%	84.5	79.3	79.0	78.0	34.6	84.8	84.7	86.2	81.7	88.1	87.1
Silver recovery	%	55.4	57.5	55.4	55.6	50.3	51.9	58.7	56.8	55.1	57.8	54.2
New Britannia Concentrator:
Ore milled	tonnes	170,477	181,403	624,631	179,808	92,765	162,934	189,124	715,198	185,592	191,298	167,899
Gold	g/tonne	5.31	6.06	6.87	6.68	6.88	6.48	7.37	6.29	5.99	6.77	5.31
Copper	%	1.00	1.04	0.95	1.08	0.76	0.65	1.18	1.04	1.17	0.93	0.94
Zinc	%	0.97	1.09	1.09	1.30	1.00	1.01	1.00	0.99	1.08	1.12	0.92
Silver	g/tonne	29.73	22.75	31.75	31.17	32.18	30.29	33.35	27.78	33.97	30.24	24.42
Gold recovery - concentrate and doré	%	90.5	90.4	89.8	88.6	91.8	89.4	90.3	89.7	90.2	90.0	90.0
Copper recovery	%	90.9	90.8	89.2	88.6	90.0	87.4	90.3	93.6	91.3	92.8	94.4
Silver recovery - concentrate and doré	%	84.5	82.2	79.0	77.1	78.5	78.0	81.6	80.9	79.6	79.9	83.1

¹Annual consolidated results may not calculate based on amounts presented in this table due to rounding.

²Reported tonnes and grade for ore mined are estimates based on mine plan assumptions and may not reconcile fully to ore milled. Total ore mined includes tonnes from Lalor and 1901.

			Q2 2026		Q1 2026		2025 ⁴		Q4 2025		Q3 2025		Q2 2025		Q1 2025		2024 ⁴		Q4 2024		Q3 2024		Q2 2024
Manitoba Operations (continued)
Total Manitoba contained metal in concentrate and doré produced⁵
Gold	ounces		40,344		47,743		173,453		47,423		22,441		43,235		60,354		214,225		51,438		62,468		43,488
Copper	tonnes		2,366		2,535		9,249		3,326		842		1,612		3,469		12,536		3,347		3,398		2,642
Zinc	tonnes		4,760		4,565		17,646		5,703		548		5,130		6,265		33,339		8,385		8,069		8,087
Silver	ounces		209,478		213,208		800,198		214,493		102,132		197,970		285,603		995,090		283,223		281,397		210,647
Total Manitoba payable metal sold in concentrate and doré
Gold	ounces		47,066		45,274		169,041		43,226		23,118		46,932		55,765		212,243		50,239		57,238		42,763
Copper	tonnes		2,466		2,658		7,651		2,024		769		2,133		2,725		11,602		3,321		2,931		2,429
Zinc¹	tonnes		2,635		3,897		15,152		3,972		3,452		2,871		4,857		25,120		5,261		8,607		5,133
Silver	ounces		209,383		193,472		729,314		175,324		112,142		209,594		232,255		956,460		282,158		244,974		197,486
Combined unit cost ^2,3	C$/tonne	$	300	$	254	$	236	$	248	$	258	$	241	$	214	$	226	$	233	$	211	$	225
Gold cash cost ³	$/oz	$	776	$	408	$	549	$	705	$	379	$	710	$	376	$	606	$	607	$	372	$	771
Sustaining gold cash cost ³	$/oz	$	1,358	$	833	$	875	$	1,110	$	762	$	1,025	$	626	$	868	$	908	$	553	$	1,163

¹ Includes refined zinc metal sold.

² Reflects combined mine, mill and G&A costs per tonne of milled ore.

³ Combined unit costs, cash cost, and sustaining cash cost per pound of copper produced, cash cost, and sustaining cash cost per ounce of gold produced, net of by-product credits, are non-GAAP financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-GAAP Financial Performance Measures" section of this MD&A. The above table sets forth selected non-GAAP financial performance measures for each of the Company's nine most recently completed quarters and three most recently completed years; detailed reconciliations for non-comparable prior periods can be found in Hudbay's MD&A for these prior periods in the "Non-GAAP Financial Performance Measures" section of these documents.

⁴Annual consolidated results may not calculate based on amounts presented in this table due to rounding.
⁵Metal reported in concentrate is prior to deductions associated with smelter terms and includes other secondary products.

			Q2 2026		Q1 2026		2025⁵		Q4 2025		Q3 2025		Q2 2025		Q1 2025		2024 ⁵		Q4 2024		Q3 2024		Q2 2024
British Columbia Operations ⁴
Ore mined¹	tonnes		3,276,090		2,916,152		9,368,918		2,395,166		1,815,689		2,509,969		2,648,094		11,360,125		2,374,044		3,098,863		2,164,722
Strip Ratio			6.22		7.06		7.46		7.18		8.84		7.50		6.73		5.98		7.36		6.05		7.61
Ore milled	tonnes		3,616,083		3,078,342		11,016,842		2,268,405		3,087,443		2,900,008		2,760,986		12,656,679		2,880,927		3,363,176		3,232,427
Copper	%		0.23		0.20		0.27		0.26		0.22		0.28		0.33		0.25		0.26		0.24		0.25
Gold	g/tonne		0.08		0.08		0.09		0.09		0.08		0.09		0.10		0.08		0.09		0.09		0.07
Silver	g/tonne		0.88		0.67		1.02		1.10		0.78		0.97		1.28		0.96		0.92		0.73		1.01
Copper recovery	%		77.3		78.9		78.6		78.4		76.6		81.0		78.3		82.4		79.5		84.1		82.3
Gold recovery	%		62.9		64.7		63.6		63.3		59.2		68.2		63.4		60.5		55.8		67.3		57.2
Silver recovery	%		69.7		64.6		69.7		71.4		65.5		71.8		69.8		71.8		69.0		71.2		73.9
Contained metal in concentrate produced
Copper	tonnes		6,455		4,821		23,784		4,705		5,249		6,634		7,196		26,406		5,927		6,736		6,719
Gold	ounces		5,608		5,187		20,001		4,010		4,760		5,670		5,561		19,789		4,644		6,274		4,454
Silver	ounces		71,178		43,042		252,811		57,475		50,816		65,040		79,480		280,499		58,933		55,963		77,227
Payable metal sold
Copper	tonnes		5,559		5,830		22,445		3,747		5,742		6,803		6,153		25,354		5,831		6,026		6,564
Gold	ounces		5,158		6,126		19,465		3,324		5,363		5,813		4,965		19,735		5,036		6,199		5,099
Silver	ounces		46,467		53,460		221,406		45,298		48,061		67,988		60,059		249,536		43,747		53,241		69,248
Combined unit cost ^2,3	C$/tonne	$	25.52	$	25.23	$	28.12	$	39.80	$	25.02	$	24.51	$	25.98	$	20.39	$	23.22	$	15.58	$	19.65
Cash cost³	$/lb	$	3.22	$	2.41	$	3.06	$	4.82	$	3.21	$	2.39	$	2.44	$	2.74	$	3.00	$	1.81	$	2.67
Sustaining cash cost ³	$/lb	$	6.23	$	7.81	$	6.12	$	8.87	$	7.43	$	5.18	$	4.24	$	5.29	$	5.76	$	5.06	$	5.56

²Reflects combined mine, mill and general and administrative ("G&A") costs per tonne of ore milled. Reflects the deduction of expected capitalized stripping costs.

⁴ Copper Mountain mine results are stated at 100%. On April 30, 2025 Hudbay completed the acquisition of the remaining 25% interest in the Copper Mountain mine and now owns 100%.

⁵ Annual consolidated results may not calculate based on amounts presented in this table due to rounding.

	TSX, NYSE - HBM 2026 No. 20

	News Release

Hudbay Delivers Strong Second Quarter 2026 Results and Improves Cash Cost Guidance

Toronto, Ontario, July 29, 2026 - Hudbay Minerals Inc. ("Hudbay" or the "Company") (TSX, NYSE: HBM) released its second quarter 2026 financial results today. All amounts are in U.S. dollars, unless otherwise noted.

"Hudbay delivered another quarter of steady operating performance and industry-leading margins, with record trailing twelve month adjusted EBITDA of $1.3 billion, driven by our unique copper and gold diversification and focus on cost control," said Peter Kukielski, Chief Executive Officer. "Our diversified operations in Canada and Peru continued to achieve operating efficiencies and deliver strong gold by-product credits, which have more than offset external cost pressures and allowed us to improve our 2026 full-year consolidated cash cost guidance. We generated over $100 million in free cash flow during the quarter and more than $200 million in free cash flow through the first half of the year, allowing us to prudently reinvest in high-return growth opportunities across the business to enhance our exposure to copper and gold. Our Copper World project is on track for sanctioning later in 2026, and our recent acquisition of the Cactus project brings together two highly complementary assets in Arizona and solidifies our position as a premier Americas-focused copper producer with a pipeline of long-life, low-cost assets in tier-one jurisdictions.

"I am also very pleased to announce two key executive leadership appointments that will position Hudbay for the next phase of transformational growth. The appointment of Eugene Lei as President and Chief Financial Officer is a significant milestone for Hudbay and recognizes his passion and strategic vision for the long-term success of the Company. Eugene has been instrumental in the significant transformation of the Company since becoming Chief Financial Officer in 2022. He successfully executed the strategic plan to unlock Copper World, including achieving our stated balance sheet targets ahead of schedule and helping to facilitate the Copper World partnership with Mitsubishi. Rob Carter's appointment as Chief Operating Officer recognizes the significant impact he has had on the business through revitalizing our Manitoba operations into becoming a sustainable cash flow contributor and bringing that expertise to our British Columbia operations. As Andre Lauzon embarks on his well-deserved retirement, I am confident that Eugene's strategic foresight in the President role and Rob's operational leadership as Chief Operating Officer will accelerate our growth pipeline and continue to maximize shareholder returns."

Delivered Strong Second Quarter Financial Results; Production Guidance Reaffirmed and Cost Guidance Improved

Achieved quarterly revenue of $631.3 million, net earnings attributable to ownersⁱ of $137.4 million, quarterly adjusted EBITDAⁱ of $321.2 million and adjusted net earnings attributable to ownersⁱ of $113.5 million in the second quarter, driven by steady operating performance, attractive operating margins and strong exposure to copper and gold across Hudbay's diversified operating portfolio.
Steady production continued in the second quarter with consolidated copper and gold production of 28,267 tonnes and 51,234 ounces, respectively, with higher copper production in line with quarterly cadence expectations while gold production was slightly lower than quarterly cadence expectations.
Industry-leading margins continued with consolidated cash costⁱand sustaining cash costⁱ, net of by-product credits, of $(0.40) and $1.39 per pound of copper, respectively, in the second quarter of 2026.
Reaffirmed full year 2026 consolidated production guidance including 110,000 to 138,000 tonnes of copper and 217,000 to 272,000 ounces of gold.
Improved full year 2026 consolidated cash costⁱ guidance to $(0.45) to $(0.25) per pound of copper from $(0.30) to $(0.10) per pound as costs are tracking well below the low end of the guidance range given strong exposure to gold by-product credits and continued operating efficiencies are more than offsetting higher input costs for fuel and consumables.

	TSX, NYSE – HBM 2026 No. 20

Peru operations produced 19,446 tonnes of copper and 5,282 ounces of gold in the second quarter of 2026, in line with quarterly cadence expectations with a planned semi-annual plant maintenance shutdown during the quarter. Peru cash costⁱ, net of by-product credits, of $1.66 per pound outperformed the low end of the 2026 annual guidance range of $1.70 to $2.10 per pound despite the lower planned production and higher fuel costs.
Manitoba operations produced 40,344 ounces of gold, 2,366 tonnes of copper, 4,760 tonnes of zinc and 209,478 ounces of silver in the second quarter of 2026, slightly lower than quarterly cadence expectations. Manitoba cash costⁱ of $776 per ounce of gold was within the annual guidance range of $500 to $800 per ounce.
British Columbia operations produced 6,455 tonnes of copper, 5,608 ounces of gold and 71,178 ounces of silver in the second quarter of 2026, in line with quarterly cadence expectations. British Columbia cash costⁱ of $3.22 per pound of copper was higher than the annual cost guidance range of $1.50 to $2.50 primarily due to elevated fuel prices and timing of equipment maintenance. British Columbia cash cost is expected to improve in the second half of the year, in line with the annual guidance range.
Second quarter earnings per share attributable to owners was $0.34 reflecting strong gross profit margins as a result of the continued focus on strong cost control and higher metal prices more than offsetting higher input costs. After adjusting for various non-cash items on a pre-tax basis, second quarter adjusted earningsⁱ per share attributable to owners was $0.28.
Cash and cash equivalents were $890.9 million and total liquidityⁱⁱ was $1,044.6 million at the end of the second quarter of 2026, despite using cash to retire over $200 million in long term debt and benefitting from the approximate $420 million initial cash contribution from Mitsubishi Corporation ("Mitsubishi") received on closing of the Copper World joint venture transaction in January 2026.

Continued Strong Cash Flow Generation and Prudent Balance Sheet Management

Hudbay's unique copper and gold diversification across its operations provides exposure to higher copper and gold prices, which together with a focus on cost control across the business, continues to realize strong margins and generate significant free cash flow.
While the majority of Hudbay's revenue continues to be derived from copper production, revenue from gold production represents a meaningful portion of total revenues. Gold revenues were 38% of total revenue in the second quarter of 2026.
Cash generated from operating activities was $297.0 million during the second quarter of 2026, reflecting an increase of $85.7 million compared to the first quarter partially as a result of favourable changes in non-cash working capital. Operating cash flow before changes in non-cash working capital was $210.1 million during the second quarter of 2026, relatively consistent with the first quarter.
Delivered free cash flowⁱ generation of $101.8 million during the second quarter of 2026, representing a similar level of free cash flow generation to the first quarter through continued strong operating margins and cost controls, resulting in more than $200 million of free cash flow generated in the first half of 2026 despite investing over $200 million of sustaining capital in the business over this period.
Achieved quarterly adjusted EBITDAⁱof $321.2 million in the second quarter of 2026, resulting in record trailing twelve month adjusted EBITDAⁱ of $1,271.6 million.
Achieved net debtⁱof negative $80.5 million as at June 30, 2026, representing an $86.1 million improvement from the first quarter of 2026 and positioning the Company well to reinvest in high-return growth capital projects across the business.
Net debt to adjusted EBITDA ratioⁱ was negative 0.1x in the second quarter of 2026, significantly improved from 0.4x in the fourth quarter of 2025 as a result of the initial proceeds received from Mitsubishi on closing of the Copper World joint venture transaction along with strong cash flows from operations.
Consistent with Hudbay's prudent balance sheet management and focus on cost of capital, Hudbay repaid $472.5 million of its outstanding 2026 senior unsecured notes on maturity on April 1, 2026, using a combination of cash on hand and a $272 million draw on its low-cost revolving credit facilities, providing the Company with enhanced financial flexibility in advance of a Copper World sanctioning decision later this year.
Received proceeds of an offering of $52 million in aggregate principal amount of solid waste disposal revenue bonds with an initial mandatory tender date in 2036. These long-term, low-cost, non-amortizing U.S. municipal bonds, may be used for certain eligible costs associated with the development of Copper World.

	TSX, NYSE – HBM 2026 No. 20

Hudbay's enhanced Capital Allocation Framework is embedded into its annual financial planning cycle to provide a holistic approach to capital allocation decisions to maximize long-term risk-adjusted returns, including capital deployment into brownfield projects, greenfield projects, strategic investments and exploration, while considering debt repurchases, share buybacks and dividends.

Advancing Generational Growth Investments to Further Enhance Copper and Gold Exposure

The Copper World definitive feasibility study ("DFS") is progressing well, and a project sanctioning decision continues to be on track for late 2026. The DFS is expected to include scope for future mill expansion optionality.
Completed the acquisition of Arizona Sonoran Copper Company Inc. ("Arizona Sonoran") to bring together two highly complementary copper growth assets in Arizona and strengthen Hudbay's position as a premier Americas-focused copper company with a pipeline of long-life, low-cost assets located in tier-one jurisdictions. The acquisition of Arizona Sonoran enhances Hudbay's long-term copper production profile and expands its U.S. growth pipeline through the staged development of Copper World and Cactus. Hudbay expects to spend approximately $30 million at Cactus in the second half of 2026 to advance an updated pre-feasibility study, perform site de-risking activities, conduct exploration activities and for other ongoing site costs.
Continued to advance a large Snow Lake exploration program to further increase near-term production and mineral reserves, test regional satellite deposits for additional mill feed to utilize available capacity at Stall and explore the large land package for a new anchor deposit to meaningfully extend mine life.
Celebrated the official groundbreaking of the New Ingerbelle expansion project at Copper Mountain, marking a significant milestone for the operation and its long-term future in British Columbia, enhancing the copper and gold production profile and securing a longer mine life. Growth capital expenditures in British Columbia in 2026 are expected to increase by approximately $30 million to $115 million, due to additional costs associated with the development of infrastructure for New Ingerbelle.
Received approval from the government in Peru to further increase annual mill processing capacity at Constancia to 34 million tonnes of ore per annum from the previously permitted 31 million tonnes, enabling additional capacity to further optimize Constancia's operations and deliver strong copper production.
Advanced initial pre-feasibility study activities at the Mason copper project in Nevada.

Summary of Second Quarter Results

Cash generated from operating activities was $297.0 million during the second quarter of 2026, reflecting an increase of $85.7 million compared to the first quarter of 2026, partially as a result of favourable changes in non-cash working capital. Operating cash flow before changes in non-cash working capital was $210.1 million during the second quarter of 2026 and remained relatively consistent with the first quarter of 2026.

Adjusted EBITDAⁱ was $321.2 million in the second quarter of 2026, a decrease compared to the record $421.9 million achieved in the first quarter of 2026 primarily due to lower sales volumes, partially offset by higher copper prices. The lower sales volumes in the second quarter of 2026 were impacted by a temporary build-up of concentrate inventory at the port in Peru. This accumulation was caused by ocean swells that resulted in temporary port closures and delayed scheduled shipments of approximately 10,000 dry metric tonnes of copper concentrate, which were delivered in the first half of July 2026.

	TSX, NYSE – HBM 2026 No. 20

Adjusted net earnings attributable to ownersⁱ and adjusted net earnings per share attributable to ownersⁱ in the second quarter of 2026 were $113.5 million and $0.28 per share, respectively, after adjusting for various non-cash items on a pre-tax basis including a $38.2 million mark-to-market revaluation net gain on various financial instruments such as investments and share-based compensation, a non-cash $12.0 million foreign exchange loss, and an $11.5 million business interruption insurance recovery related to the Manitoba mandatory wildfire evacuations shutdowns in 2025, among other items. This compares to adjusted net earnings attributable to ownersⁱ and net earnings per share attributable to ownersⁱ of $161.0 million and $0.40 per share, respectively, in the first quarter of 2026. The decrease is a result of lower realized metal prices for gold and the aforementioned lower sales volumes.

Consolidated cash costⁱ, net of by-product credits, in the second quarter of 2026 was $(0.40) per pound of copper, compared to record low cash cost of $(1.80) per pound in the first quarter of 2026. The increase from the first quarter of 2026 was a result of lower by-product credits from lower gold volumes.

Consolidated sustaining cash costⁱ, net of by-product credits, in the second quarter of 2026 was $1.39 per pound of copper, compared to $0.00 per pound in the first quarter of 2026. This increase was primarily due to the same factors impacting consolidated cash costⁱ noted above.

Consolidated all-in sustaining cash costⁱ, net of by-product credits, in the second quarter of 2026 was $1.80 per pound of copper, higher than the first quarter of 2026 due to the same reasons noted above, partially offset by lower corporate general and administrative ("G&A") costs from the impact of the revaluation of Hudbay's share-based compensation.

As at June 30, 2026, total liquidityⁱⁱ was $1,044.6 million, including $890.9 million in cash and cash equivalents, which excludes $49.8 million in U.S. municipal bond proceeds that is classified as restricted cash, and undrawn availability of $153.7 million under Hudbay's revolving credit facilities. Net debtⁱ at the end of the second quarter was negative $80.5 million, marking an $86.1 million improvement from first quarter of 2026 primarily as a result of positive cash flows from operations. Hudbay expects that the current liquidity, together with cash flows from operations, will be sufficient to meet the Company's liquidity needs for the remainder of 2026.

Consolidated Financial Condition (in $ millions, except net debt to adjusted EBITDA ratio)	Jun. 30, 2026	Mar. 31, 2026	Dec. 31, 2025
Cash and cash equivalents¹	890.9	1,003.8	568.9
Total long-term debt	860.2	1,009.4	1,008.6
Net debt^2,3	(80.5)	5.6	439.7
Working capital⁴	751.8	407.3	(65.6)
Total assets	8,062.0	6,896.9	6,223.3
Equity attributable to owners of the Company	4,797.2	3,533.5	3,231.0
Net debt to adjusted EBITDA²	(0.1)	0.0	0.4

¹ As at June 30, 2026 cash and cash equivalents include $334.5 million in cash held by Copper World LLC. These funds are contractually restricted solely for the advancement of the Copper World project and are not available to the general Hudbay group.

² Net debt and net debt to adjusted EBITDA are non-GAAP financial performance measures with no standardized definition under IFRS. For further information, please see the "Non-GAAP Financial Performance Measures" section of this news release.

³Hudbay calculates net debt as total long-term debt less cash and cash equivalents and restricted cash related to unspent proceeds of its senior unsecured municipal bond financing.

⁴Working capital is determined as total current assets less total current liabilities as defined under IFRS and disclosed on the consolidated interim financial statements.

	TSX, NYSE – HBM 2026 No. 20

Consolidated Financial Performance

Three Months Ended

Jun. 30, 2026

Mar. 31, 2026

Jun. 30, 2025

Revenue

$ millions

631.3

757.3

536.4

Cost of sales

$ millions

362.3

389.3

359.9

Earnings before tax

$ millions

240.4

339.0

153.1

Net earnings

$ millions

138.1

191.5

114.7

Net earnings attributable to owners

$ millions

137.4

190.4

117.7

Basic and diluted attributable earnings per share

$/share

0.34

0.48

0.30

Adjusted earnings attributable per share ¹

$/share

0.28

0.40

0.19

Operating cash flow before change in non-cash working capital

$ millions

210.1

208.7

193.9

Adjusted EBITDA¹

$ millions

321.2

421.9

245.2

Free cash flow¹

$ millions

101.8

102.3

86.7

¹ Adjusted earnings attributable per share, adjusted EBITDA and free cash flow are non-GAAP financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see discussion under the "Non-GAAP Financial Performance Measures" section of this news release.

Consolidated Production and Cost Performance

Three Months Ended

Jun. 30, 2026

Mar. 31, 2026

Jun. 30, 2025

Contained metal in concentrate and doré produced¹

Copper

tonnes

28,267

27,929

29,956

Gold

ounces

51,234

61,700

56,271

Silver

ounces

845,161

787,449

814,989

Zinc

tonnes

4,760

4,565

5,130

Molybdenum

tonnes

277

380

375

Payable metal sold

Copper

tonnes

23,780

29,544

30,354

Gold²

ounces

56,266

66,562

62,466

Silver²

ounces

674,490

923,051

894,160

Zinc

tonnes

2,635

3,897

2,871

Molybdenum

tonnes

298

375

427

Consolidated cash cost per pound of copper produced³

Cash cost

$/lb

(0.40)

(1.80)

(0.02)

Sustaining cash cost

$/lb

1.39

0.00

1.65

All-in sustaining cash cost

$/lb

1.80

0.73

2.03

¹ Metal reported in concentrate is prior to deductions associated with smelter contract terms and includes other secondary products.

² Includes total payable gold and silver in concentrate and in doré sold and other secondary products.

³ Cash cost, sustaining cash cost and all-in sustaining cash cost per pound of copper produced, net of by-product credits are non-GAAP financial performance measures with no standardized definition under IFRS. For further information, please see the "Non-GAAP Financial Performance Measures" section of this news release.

	TSX, NYSE – HBM 2026 No. 20

Peru Operations Review

Peru Operations		Three Months Ended
		Jun. 30, 2026	Mar. 31, 2026	Jun. 30, 2025
Constancia ore mined¹	tonnes	10,962,399	10,701,375	6,735,316
Copper	%	0.28	0.29	0.34
Gold	g/tonne	0.04	0.03	0.03
Silver	g/tonne	3.68	3.11	3.26
Molybdenum	%	0.01	0.01	0.02
Pampacancha ore mined^1,2	tonnes	-	-	762,172
Copper	%	-	-	0.26
Gold	g/tonne	-	-	0.24
Silver	g/tonne	-	-	4.59
Molybdenum	%	-	-	0.01
Total ore mined	tonnes	10,962,399	10,701,375	7,497,488
Strip ratio³		0.88	0.83	1.47
Ore milled	tonnes	7,827,509	8,163,847	7,559,047
Copper	%	0.30	0.31	0.34
Gold	g/tonne	0.04	0.06	0.05
Silver	g/tonne	3.75	3.09	3.58
Molybdenum	%	0.01	0.01	0.01
Copper recovery	%	82.0	81.5	84.5
Gold recovery	%	48.8	59.9	56.0
Silver recovery	%	59.9	65.4	63.5
Molybdenum recovery	%	39.9	36.0	38.7
Contained metal in concentrate
Copper	tonnes	19,446	20,573	21,710
Gold	ounces	5,282	8,770	7,366
Silver	ounces	564,505	531,199	551,979
Molybdenum	tonnes	277	380	375
Payable metal sold
Copper	tonnes	15,755	21,056	21,418
Gold	ounces	4,042	15,162	9,721
Silver	ounces	418,640	676,119	616,578
Molybdenum	tonnes	298	375	427
Combined unit operating cost^4,5	$/tonne	14.06	11.61	13.59
Cash cost⁵	$/lb	1.66	0.70	1.45
Sustaining cash cost⁵	$/lb	2.71	1.43	2.63

¹Reported tonnes and grade for ore mined are estimates based on mine plan assumptions and may not reconcile fully to ore milled.

²Pampacancha has been depleted as of December 31, 2025.

³ Strip ratio is calculated as waste mined divided by ore mined.

⁴ Reflects combined mine, mill and general and administrative ("G&A") costs per tonne of ore milled. Reflects the deduction of expected capitalized stripping costs.

⁵ Combined unit costs, cash cost and sustaining cash cost per pound of copper produced, net of by-product credits, are non-GAAP financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-GAAP Financial Performance Measures" section of this news release.

	TSX, NYSE – HBM 2026 No. 20

In the second quarter of 2026, the Peru operations produced 19,446 tonnes of copper, 5,282 ounces of gold, 564,505 ounces of silver and 277 tonnes of molybdenum. Production of copper, gold and molybdenum was slightly lower compared to the first quarter of 2026, reflecting the planned semi-annual plant maintenance shutdown during the second quarter of 2026. Hudbay is on track to achieve its 2026 production guidance for all metals in Peru.

Total material moved during the second quarter of 2026 was 23.9 million tonnes, consistent with ore mined in the first quarter of 2026, and, in May the highest monthly total material moved over the last ten years was achieved. Peru realized improved productivity from enhanced fleet efficiency and the implementation of haulage optimization strategies.

Mill throughput levels averaged approximately 86,000 tonnes per day during the second quarter of 2026, a marginal decrease compared to the first quarter of 2026, primarily due to the scheduled semi-annual plant maintenance shutdown and the processing of more metallurgically complex ore during the second quarter of 2026. Milled copper grades decreased slightly compared to the first quarter of 2026 due to blending targets implemented to control contaminants in the concentrate. As expected, overall gold grades declined primarily due to the transition away from the higher-grade gold contributions from the Pampacancha stockpile. Metal recoveries remained in line with expectations.

Combined mine, mill and G&A unit operating costⁱ in the second quarter of 2026 was $14.06 per tonne, which increased by 21% compared to first quarter of 2026, primarily due to higher fuel prices and the planned semi-annual plant maintenance shutdown in May 2026.

Cash costⁱ, net of by-product credits, in the second quarter of 2026 was $1.66 per pound of copper, an increase compared to the first quarter of 2026, primarily due to lower gold by-product credits resulting from lower gold volumes given the completion of mining of the high gold content Pampacancha stockpile in the first quarter, combined with higher fuel prices in the second quarter and the planned semi-annual plant maintenance shutdown in May 2026. This increase was partially offset by lower profit sharing. Despite the increase, cash cost for the quarter continued to outperform the low-end of the 2026 guidance range as a result of strong operating cost performance and higher by-product prices more than offsetting external cost pressures. Hudbay is well positioned to achieve the full year 2026 cash cost guidance range in Peru.

Sustaining cash costⁱ, net of by-product credits, in the second quarter of 2026 was $2.71 per pound of copper, an increase compared to the first quarter of 2026, primarily due to the same reasons affecting cash costs above, as well as higher community agreement payments.

Sales volumes were impacted by a temporary build-up of concentrate inventory at the port caused by ocean swells that resulted in temporary port closures and delayed scheduled shipments. As a result, approximately 10,000 dry metric tonnes of copper concentrate sales were deferred to the first half of July.

	TSX, NYSE – HBM 2026 No. 20

Manitoba Operations Review

Manitoba Operations		Three Months Ended
		Jun. 30, 2026	Mar. 31, 2026	Jun. 30, 2025
Lalor
Ore mined¹	tonnes	321,719	349,980	303,062
Gold	g/tonne	4.41	4.72	4.97
Copper	%	0.84	0.80	0.61
Zinc	%	2.25	2.10	2.46
Silver	g/tonne	28.33	26.22	29.94
New Britannia
Ore milled	tonnes	170,477	181,403	162,934
Gold	g/tonne	5.31	6.06	6.48
Copper	%	1.00	1.04	0.65
Zinc	%	0.97	1.09	1.01
Silver	g/tonne	29.73	22.75	30.29
Gold recovery²	%	90.5	90.4	89.4
Copper recovery	%	90.9	90.8	87.4
Silver recovery²	%	84.5	82.2	78.0
Stall Concentrator
Ore milled	tonnes	148,037	178,981	144,204
Gold	g/tonne	3.30	3.26	3.19
Copper	%	0.66	0.53	0.56
Zinc	%	3.81	3.22	4.20
Silver	g/tonne	27.46	29.68	29.55
Gold recovery	%	70.8	73.5	67.9
Copper recovery	%	83.7	85.9	84.7
Zinc recovery	%	84.5	79.3	84.8
Silver recovery	%	55.4	57.5	51.9
Total contained metal in concentrate and doré³
Gold	ounces	40,344	47,743	43,235
Copper	tonnes	2,366	2,535	1,612
Zinc	tonnes	4,760	4,565	5,130
Silver	ounces	209,478	213,208	197,970
Total payable metal sold⁴
Gold	ounces	47,066	45,274	46,932
Copper	tonnes	2,466	2,658	2,133
Zinc	tonnes	2,635	3,897	2,871
Silver	ounces	209,383	193,472	209,594
Combined unit operating cost ^5,6,7	C$/tonne	300	254	241
Gold cash cost^7,8	$/oz	776	408	710
Gold sustaining cash cost⁷	$/oz	1,358	833	1,025

¹ Reported tonnes and grade for ore mined are estimates based on mine plan assumptions and may not reconcile fully to ore milled.
² Gold and silver recovery includes total recovery from concentrate and doré.

³ Total metal reported in concentrate is prior to deductions associated with smelter terms and includes other secondary products. Doré includes sludge, slag and carbon fines.

⁴ lncludes other secondary products.

⁵ Reflects combined mine, mill and G&A costs per tonne of ore milled.

⁶ Excludes $3.2 million or C$14 per tonne of overhead costs incurred during temporary suspension during the three months ended June 30, 2025.

⁷ Combined unit cost, cash cost, sustaining cash cost per ounce of gold produced, net of by-product credits, are non-GAAP financial performance measures with no standardized definition under IFRS. For further information, please see the "Non-GAAP Financial Performance Measures" section of this news release.

⁸ Excludes $3.2 million or $74 per ounce of overhead costs incurred during temporary suspension during the three months ended June 30, 2025.

	TSX, NYSE – HBM 2026 No. 20

The Manitoba operations continued to execute its strategic initiatives during the second quarter of 2026, navigating short-term operational hurdles while positioning the business for an expected strong second half of the year. To address labour availability constraints, Hudbay engaged an experienced mining contractor to advance the 1901 deposit. This strategic decision has enabled the team to redeploy its skilled internal workforce to other critical development areas at Lalor. The Company has simultaneously increased its internal capacity, onboarding over 100 new employees in 2026 who are currently undergoing upskilling to enhance long-term operational self-sufficiency in Manitoba.

While the operations experienced minor production impacts from an unplanned hoist gearbox failure at Lalor in June, the hoist is now repaired and fully operational, and the team strategically prioritized high-value gold zones to maintain consistent feed for the New Britannia mill. These initiatives position the business to support higher production volumes and grades in the second half of 2026, which remains aligned with annual production guidance in Manitoba.

The Manitoba operations produced 40,344 ounces of gold, 2,366 tonnes of copper, 4,760 tonnes of zinc and 209,478 ounces of silver in the second quarter of 2026. Compared to the first quarter of 2026, production of gold, copper and silver was lower primarily due to lower tonnes milled, while zinc production was slightly higher. Production in the second half of 2026 is expected to be higher than the first half of 2026 due to grade sequencing and higher ore output from Lalor, as previously disclosed. Hudbay is on track to achieve its 2026 production guidance for all metals in Manitoba.

The Lalor mine hoisted an average of approximately 3,500 tonnes of ore per day in the second quarter of 2026, strategically prioritizing gold zones to secure optimal feed for the New Britannia mill. Total ore mined in the second quarter of 2026 was lower than the first quarter of 2026, primarily driven by reduced workforce availability, which limited effective utilization of equipment and workplaces. In the second quarter of 2026, gold grades decreased by 7% when compared to the first quarter of 2026, driven by planned mine sequencing.

The 1901 deposit delivered approximately 7,600 tonnes of development ore in the second quarter of 2026. Looking ahead, the plan is to continue to prioritize exploration and infill drilling, orebody access and critical infrastructure development as 1901 progresses toward full production in late 2027.

The New Britannia mill processed approximately 1,900 tonnes per day in the second quarter of 2026, matching the gold ore output from Lalor during the quarter. New Britannia continued to achieve steady gold recoveries of approximately 90%, reflecting ongoing optimization efforts. The Stall mill processed less ore in the second quarter than the first quarter of 2026, consistent with the Lalor base metal production. The Stall mill achieved gold recoveries of 71% during the second quarter of 2026, continuing to reflect recovery focused initiatives. The Company also initiated early works on installing new tailings lines between the two mills, which is expected to increase the pipeline capacity to enable higher throughput and leaching of gold-bearing material at New Britannia from base metal ore originally processed at Stall mill.

Combined mine, mill and G&A unit operating costsⁱ in the second quarter of 2026 were C$300 per tonne, an increase compared to the first quarter of 2026 as a result of marginally higher onsite costs and lower ore milled due to reduced workforce availability, limiting the effective utilization of equipment and workplaces, as well as the failure of a critical hoist gearbox motor at Lalor.

Cash costⁱ, net of by-product credits, in the second quarter of 2026 was $776 per ounce of gold. This represents a 90% increase compared to the first quarter of 2026, primarily due to lower gold production and higher unit operating costs across mining, milling activities and G&A, impacted by the same factors as combined mine, mill and G&A unit operating costs. Despite the increase, cash cost was within the guidance range for 2026 and Hudbay remains on track to achieve its full year cash cost guidance range in Manitoba.

Sustaining cash costⁱ, net of by-product credits, in the second quarter of 2026 was $1,358 per ounce of gold, higher than the first quarter of 2026 primarily due to the same factors affecting cash costs along with higher sustaining capital.

	TSX, NYSE – HBM 2026 No. 20

British Columbia Operations Review

British Columbia Operations		Three Months Ended
		Jun. 30, 2026	Mar. 31, 2026	Jun. 30, 2025
Ore mined¹	tonnes	3,276,090	2,916,152	2,509,969
Strip ratio²		6.22	7.06	7.50
Ore milled	tonnes	3,616,083	3,078,342	2,900,008
Copper	%	0.23	0.20	0.28
Gold	g/tonne	0.08	0.08	0.09
Silver	g/tonne	0.88	0.67	0.97
Copper recovery	%	77.3	78.9	81.0
Gold recovery	%	62.9	64.7	68.2
Silver recovery	%	69.7	64.6	71.8
Total contained metal in concentrate
Copper	tonnes	6,455	4,821	6,634
Gold	ounces	5,608	5,187	5,670
Silver	ounces	71,178	43,042	65,040
Total payable metal sold
Copper	tonnes	5,559	5,830	6,803
Gold	ounces	5,158	6,126	5,813
Silver	ounces	46,467	53,460	67,988
Combined unit operating cost^3,4	C$/tonne	25.52	25.23	24.51
Cash cost ⁴	$/lb	3.22	2.41	2.39
Sustaining cash cost ⁴	$/lb	6.23	7.81	5.18

¹Reported tonnes and grade for ore mined are estimates based on mine plan assumptions and may not reconcile fully to ore milled.

²Strip ratio is calculated as waste mined divided by ore mined.

³Reflects combined mine, mill and general and administrative ("G&A") costs per tonne of ore milled. Reflects the deduction of expected capitalized stripping costs.

⁴ Combined unit operating cost, cash cost and sustaining cash cost per pound of copper produced, net of by-product credits, are non-GAAP financial performance measures with no standardized definition under IFRS. For further information, please see the "Non-GAAP Financial Performance Measures" section of this news release.

⁵ Copper Mountain mine results are stated at 100%. On April 30, 2025 Hudbay completed the acquisition of the remaining 25% interest in the Copper Mountain mine and now owns 100%.

The British Columbia operations produced 6,455 tonnes of copper, 5,608 ounces of gold, and 71,178 ounces of silver in the second quarter of 2026, which increased compared to the first quarter of 2026 for all metals as a result of higher ore mined, improved grades and higher throughput. Hudbay is on track to achieve its 2026 production guidance for all metals in British Columbia and continues to expect higher production in the second half of the year as the mill improvement projects take effect.

In May 2026, Copper Mountain received the 2025 John Ash Safety Award from the BC Ministry of Mining and Critical Minerals, recognizing Copper Mountain as the safest open pit mine in British Columbia in 2025, demonstrating Hudbay's sustained focus on safety.

	TSX, NYSE – HBM 2026 No. 20

Total ore mined at Copper Mountain in the second quarter of 2026 was 3.3 million tonnes, an increase of 12% compared to the first quarter of 2026. During the second quarter of 2026, blending initiatives from the main pit maintained stable ore feed to the mill, allowing the operation to prioritize waste stripping activities to expose higher-value mining fronts in the future. The mine is now positioned favourably to unlock higher-grade copper from the main pit in late 2026, and more specifically in 2027 and 2028.

Mill performance continues to demonstrate improvement following the optimization efforts initiated in 2025. The second semi-autogenous grinding ("SAG") mill delivered increased throughput in the quarter, reaching commercial production in May and averaging 12,000 tonnes per day thereafter. Throughput continues to ramp up, with some days exceeding 20,000 tonnes per day in late June and into July.

Despite the operating constraints on the primary SAG, the mill processed 3.6 million tonnes of ore during the second quarter of 2026, an increase of 17% compared to the first quarter of 2026, benefitting from improved operating parameters from the second SAG mill and the temporary conveyor system trial in place to divert crushed pebbles from the primary SAG to the second SAG. Based on the successful trial, a more permanent system is being constructed and is scheduled to be commissioned by the fourth quarter.

Milled copper grades during the second quarter of 2026 were higher compared to the first quarter of 2026, driven by a greater proportion of ore feed mined from a higher-grade phase in the second quarter of 2026. Copper and gold recoveries during the quarter declined to 77% and 63%, respectively. This decline resulted from the ramp-up of mill throughput during the second quarter which revealed a grinding constraint in the ball mills, resulting in increased grind size and lower overall recoveries compared to the first quarter of 2026. Several grinding initiatives are underway, alongside flotation advanced process controls to improve recoveries.

Combined mine, mill and G&A unit operating costs in the second quarter of 2026 were C$25.52 per tonne milled, a marginal increase compared to the first quarter of 2026, primarily driven by higher mining and G&A costs, partially offset by lower milling costs and higher milled throughput.

Cash costⁱ and sustaining cash costⁱ, net of by-product credits, were $3.22 and $6.23, respectively, per pound of copper in the second quarter of 2026. Cash costⁱ was higher than in the first quarter of 2026 primarily as a result of higher mining costs, less deferred stripping and lower by-product credits, partially offset by higher copper production. The increase in mill availability in the second quarter of 2026 allowed for higher mill throughput and enhanced operational efficiencies. Although second quarter cash cost was above the 2026 guidance range due to external cost pressures, Hudbay expects to achieve the full year 2026 cash cost guidance range in British Columbia.

	TSX, NYSE – HBM 2026 No. 20

Key Leadership Appointments

	TSX, NYSE – HBM 2026 No. 20

Continued Free Cash Flow Generation Driven by Strong Operating Margins; External Cost Pressures Insulated by Diversified Copper and Gold Exposure

Hudbay's cost control efforts are focused on navigating external cost pressures, such as higher fuel and consumable costs. The Company continues to manage costs and deliver strong margins through initiatives to further improve throughput and enhance operating efficiencies. Despite such external cost pressures in the second quarter, Hudbay achieved consolidated cash costⁱ of negative $0.40 per pound of copper and generated operating cash flow of over $200 million and free cash flow of over $100 million, similar to the first quarter of 2026. Hudbay continues to benefit from its diversified platform with significant by-product credits from gold production.

The Company had $890.9 million in cash and cash equivalents and net debtⁱ of negative $80.5 million at the end of the second quarter of 2026. Hudbay's strong cash position and continued prudent balance sheet management position the Company well to advance its generational growth investments across the portfolio and allocate capital to the highest risk-adjusted return opportunities to deliver significant value for stakeholders.

Copper World DFS Progressing Well and Project Sanctioning on Track for Late 2026

Feasibility activities for the Copper World DFS are progressing well, with 95% of the engineering work completed, and a sanctioning decision remains on track for later in 2026. The DFS is expected to reflect higher capital expenditures as compared to the 2023 pre-feasibility study primarily due to typical cost inflation along with new capital related to project scope changes that would allow for future mill expansion optionality, while continuing to generate robust economics.

Completion of the Arizona Sonoran Acquisition to Create the Third Largest Copper District in North America

On June 24, 2026, Hudbay successfully completed its previously announced acquisition of Arizona Sonoran ("ASCU"), pursuant to which Hudbay acquired all of the issued and outstanding common shares of ASCU not already owned by Hudbay (the "ASCU Transaction").

	TSX, NYSE – HBM 2026 No. 20

As a result of the completion of the ASCU Transaction, Arizona Sonoran became a wholly-owned subsidiary of Hudbay and Hudbay acquired 100% ownership of Arizona Sonoran's Cactus project. In aggregate, Hudbay issued 46,794,082 Hudbay common shares under the ASCU Transaction to former Arizona Sonoran shareholders as consideration for their shares. Following the closing of the ASCU Transaction, the Arizona Sonoran shares were de-listed from the Toronto Stock Exchange ("TSX") and Arizona Sonoran ceased to be a reporting issuer pursuant to applicable Canadian securities laws.

New Ingerbelle Expansion Project Underway to Enhance Copper and Gold Production Profile at Copper Mountain

The groundbreaking comes shortly after the Government of British Columbia added New Ingerbelle to its list of priority resource projects, recognizing initiatives that support economic growth, responsible resource development and long-term value creation across the province. The New Ingerbelle expansion received key mining permits on February 19, 2026 from the British Columbia Major Mines Office ("MMO") following a robust review and consultation process. Throughout the permitting process, Hudbay proactively engaged with the MMO, local communities, the Upper Similkameen Indian Band ("USIB") and the Lower Similkameen Indian Band ("LSIB") to ensure transparency and collaborative oversight and to seek consensus, although as previously disclosed, the LSIB subsequently submitted an application for judicial review of the regulatory decision to grant the New Ingerbelle permit amendment.

Peru Regulatory Approval Received to Further Increase Mill Throughput at Constancia

	TSX, NYSE – HBM 2026 No. 20

Large Exploration Drill Program Continues in Snow Lake

● Near-mine Exploration at Lalor and 1901 to Further Increase Near-term Production and Extend Mine Life - Near-mine exploration at the Lalor mine and the adjacent 1901 deposit continued to support near-term production growth and mine life extension. The exploration program will continue during the remainder of 2026 to potentially increase mineral reserves and resources and enable additional resource conversion. At the 1901 deposit, activities are focused on exploration and definition drilling, orebody access and establishing the critical infrastructure required to support full production beginning in late 2027. Exploration activities at 1901 will include step-out drilling to potentially extend the orebody, as well as infill drilling aimed at converting inferred mineral resources within the gold lenses to mineral reserves.

● Evaluating Significant Gold Production Potential from Past-Producing New Britannia mine - Acquired through the New Britannia mill acquisition in 2015, the past-producing New Britannia mine provides potential for significant incremental gold production in Snow Lake. The Company is developing an exploration plan to test down plunge extensions and underexplored areas between known deposits at the mine. Hudbay plans to conduct infill and expansion drilling at the 3 Zone, a satellite deposit to New Britannia, with three drills scheduled for later in 2026.

● Testing Regional Satellite Deposits to Utilize Available Processing Capacity and Increase Production - Hudbay's extensive regional land package includes an attractive portfolio of deposits in Snow Lake within trucking distance of the Snow Lake processing infrastructure, including the Talbot, Rail, Pen II, Watts and WIM deposits. With available mill processing capacity at the Stall mill, the Company continues to progress exploration work across the region to define satellite deposits to potentially increase production and extend the life of the Snow Lake operations beyond 2041. During the second quarter of 2026, the infill drilling program at Talbot was completed as well as the geotechnical drilling required for PFS activities. The Company is also testing additional targets to expand the footprint of the deposit at depth. Hudbay intends to update Rockcliff's prior mineral resource estimate for Talbot using Hudbay's standard methods.

● Exploring Large Land Package for New Anchor Deposit to Significantly Extend Mine Life - A majority of the land claims acquired as part of the Rockcliff acquisition in 2023 have been untested by modern deep geophysics, which was the discovery method for the Lalor deposit. The large geophysics program underway consisting of surface electromagnetic surveys using cutting edge techniques that enable the team to detect targets at depths of almost 1,000 metres below surface. The planned 2026 geophysics program includes 600 kilometres of ground electromagnetic surveys and an extensive airborne geophysics survey.

Mason Project Commences Pre-feasibility Study Activities

	TSX, NYSE – HBM 2026 No. 20

Dividend Declared

A quarterly dividend of C$0.01 per share was declared on July 28, 2026. The dividend will be paid out on September 8, 2026 to shareholders of record as of close of business on September 25, 2026.

Website Links

Hudbay: www.hudbay.com

Management's Discussion and Analysis:

https://www.hudbayminerals.com/MDA726

Financial Statements:

https://www.hudbayminerals.com/FS726

Conference Call and Webcast

Date:	Wednesday, July 29, 2026

Time:	11:00 a.m. ET

Webcast:	www.hudbay.com

Dial in:	647-846-8185 or 1-833-752-3516

Qualified Person and NI 43-101

The technical and scientific information in this news release related to all of Hudbay's material mineral projects other than the Copper Mountain mine has been approved by Olivier Tavchandjian, P. Geo., Senior Vice President, Exploration and Technical Services. The technical and scientific information in this news release related to the Copper Mountain mine has been approved by Marc-Andre Brulotte, P. Geo., Executive Director, Global Mineral Resource Evaluation. Messrs. Tavchandjian and Brulotte are qualified persons pursuant to NI 43-101.

For a description of the key assumptions, parameters and methods used to estimate mineral reserves and resources at Hudbay's material mineral properties, as well as data verification procedures and a general discussion of the extent to which the estimates of scientific and technical information may be affected by any known environmental, permitting, legal title, taxation, sociopolitical, marketing or other relevant factors, please see the technical reports for the Company's material properties are available on SEDAR+ at www.sedarplus.ca and EDGAR at www.sec.gov.

	TSX, NYSE – HBM 2026 No. 20

Non-GAAP Financial Performance Measures

Adjusted net earnings (loss) attributable to owners, adjusted net earnings (loss) per share attributable to owners, adjusted EBITDA, net debt, net debt to adjusted EBITDA, free cash flow, cash cost, sustaining and all-in sustaining cash cost per pound of copper produced, cash cost and sustaining cash cost per ounce of gold produced, combined unit cost and ratios based on these measures are non-GAAP performance measures. These measures do not have a meaning prescribed by IFRS and are therefore unlikely to be comparable to similar measures presented by other issuers. These measures should not be considered in isolation or as a substitute for measures prepared in accordance with IFRS and are not necessarily indicative of operating profit or cash flow from operations as determined under IFRS. Other companies may calculate these measures differently.

Management believes adjusted net earnings (loss) attributable to owners and adjusted net earnings (loss) per share attributable to owners provides an alternate measure of the Company's performance for the current period and gives insight into its expected performance in future periods. These measures are used internally by the Company to evaluate the performance of its underlying operations and to assist with its planning and forecasting of future operating results. As such, the Company believes these measures are useful to investors in assessing the Company's underlying performance. Hudbay provides adjusted EBITDA to help users analyze the Company's results and to provide additional information about its ongoing cash generating potential in order to assess its capacity to service and repay debt, carry out investments and cover working capital needs. Net debt is shown because it is a performance measure used by the Company to assess its financial position. Net debt to adjusted EBITDA is shown because it is a performance measure used by the Company to assess its financial leverage and debt capacity. Free cash flow is shown as it provides investors and management additional information in assessing the Company's ability to generate cash flow from current operations after investing in capital to sustain the operations. Cash cost, sustaining and all-in sustaining cash cost per pound of copper produced are shown because the Company believes they help investors and management assess the performance of its operations, including the margin generated by the operations and the Company. Cash cost and sustaining cash cost per ounce of gold produced are shown because the Company believes they help investors and management assess the performance of its Manitoba operations. Combined unit cost is shown because Hudbay believes it helps investors and management assess the Company's cost structure and margins that are not impacted by variability in by-product commodity prices.

The following tables provide detailed reconciliations to the most comparable IFRS measures.

	TSX, NYSE – HBM 2026 No. 20

Adjusted Net Earnings (Loss) Reconciliation

	Three Months Ended
(in $ millions)	Jun. 30, 2026		Mar. 31, 2026		Jun. 30, 2025
Net earnings for the period	138.1		191.5		114.7
Tax expense	102.3		147.5		38.4
Earnings before tax	240.4		339.0		153.1
Adjusting items:
Mark-to-market adjustments ¹	(38.2	)	(38.7	)	6.3
Foreign exchange loss (gain)	12.0		10.7		(18.9	)
Re-evaluation adjustment - environmental provision	5.5		2.1		(13.8	)
Manitoba cost of sales and other expense from temporary shutdown	-		-		5.3
Variable consideration adjustment - stream revenue and accretion	-		0.1		-
Inventory adjustments	0.9		-		3.5
Evaluation expenses	9.2		2.9		-
Insurance recovery	(11.5	)	-		-
Reduction of obligation to renounce flow-through share expenditures, net of provisions	(2.8	)	(3.3	)	(1.2	)
Loss/write-down on disposal of PP&E	0.5		1.0		0.3
Changes in other provisions (non-capital)	-		-		-
Adjusted earnings before income taxes	216.0		313.8		134.6
Tax expense	(102.3	)	(147.5	)	(38.4	)
Tax impact on adjusting items	0.5		(4.2	)	(23.0	)
Adjusted net earnings	114.2		162.1		73.2
Adjusted net earnings attributable to non-controlling interest:
Net (earnings) loss for the period	(0.7	)	(1.1	)	3.0
Adjusting items, including tax impact	-		-		(0.7	)
Adjusted net earnings - attributable to owners	113.5		161.0		75.5
Adjusted net earnings ($/share) - attributable to owners	0.28		0.40		0.19
Basic weighted average number of common shares outstanding (millions)	400.4		396.9		395.1

¹ Includes changes in fair value of the gold prepayment liability, Canadian junior mining investments, other financial assets and liabilities at fair value through net earnings and share-based compensation (recoveries) expenses. Also includes gains and losses on disposition of investments.

	TSX, NYSE – HBM 2026 No. 20

Adjusted EBITDA Reconciliation

	Three Months Ended
(in $ millions)	Jun. 30, 2026		Mar. 31, 2026		Jun. 30, 2025
Net earnings for the period	138.1		191.5		114.7
Add back:
Tax expense	102.3		147.5		38.4
Other (income) expenses	(20.7	)	(33.8	)	-
Other operating expenses	4.7		10.1		7.1
Depreciation and amortization	88.8		99.9		96.4
Amortization of deferred revenue and variable consideration adjustment	(9.5	)	(19.5	)	(15.4	)
Adjusting items (pre-tax):
Re-evaluation adjustment - environmental provision	5.5		2.1		(13.8	)
Inventory adjustments	0.9		-		3.5
Overhead costs incurred during Manitoba temporary suspension (cash)	-		-		3.2
Option agreement proceeds	1.0		0.6		1.0
Realized loss on non-QP hedges	(0.1	)	-		(0.4	)
Share-based compensation expenses ¹	10.2		23.5		10.5
Adjusted EBITDA	321.2		421.9		245.2

¹ Share-based compensation expenses reflected in cost of sales and selling and administrative expenses.

	TSX, NYSE – HBM 2026 No. 20

Net Debt Reconciliation

(in $ millions)
	Jun. 30, 2026		Mar. 31, 2026		Dec. 31, 2025
Total long-term debt	860.2		1,009.4		1,008.6
Cash and cash equivalents¹	(890.9	)	(1,003.8	)	(568.9	)
Restricted cash related to unspent proceeds on senior unsecured municipal bonds²	(49.8	)	-		-
Net debt²	(80.5	)	5.6		439.7
Net debt	(80.5	)	5.6		439.7
Adjusted EBITDA (12-month period)	1,271.6		1,195.6		1,060.9
Net debt to adjusted EBITDA	(0.1	)	0.0		0.4

² Hudbay calculates net debt as total long-term debt less cash and cash equivalents and restricted cash related to unspent proceeds of its senior unsecured municipal bond financing. For further information on the restricted cash related to unspent proceeds of senior unsecured municipal bond financing please see note 11 in the consolidated interim financial statements.

Trailing Adjusted EBITDA	Three Months Ended
(in $ millions)	Jun. 30, 2026		Mar. 31, 2026		Dec. 31, 2025		Sep. 30, 2025		Jun. 30, 2025
Earnings for the period	138.1		191.5		128.0		222.4		114.7
Add back:
Tax expense	102.3		147.5		129.1		108.1		38.4
Other (income) expenses	(20.7	)	(33.8	)	(14.6	)	19.6		-
Other operating expenses	4.7		10.1		(13.6	)	9.1		7.1
Depreciation and amortization	88.8		99.9		152.5		82.7		96.4
Amortization of deferred revenue and variable consideration adjustment	(9.5	)	(19.5	)	(24.0	)	(6.3	)	(15.4	)
Adjusting items (pre-tax):
Impairment reversal	-		-		-		(322.3	)	-
Consideration received from non-core project	-		-		-		(14.9	)	-
Re-evaluation adjustment - environmental provision	5.5		2.1		(0.2	)	1.4		(13.8	)
Inventory adjustments	0.9		-		0.7		(1.3	)	3.5
Overhead costs incurred during Manitoba temporary suspension (cash)	-		-		-		16.0		3.2
Overhead costs incurred during Peru temporary suspension (cash)	-		-		1.3		7.3		-
Realized loss on non-QP hedges	(0.1	)	-		-		-		(0.4	)
Option agreement proceeds	1.0		0.6		0.9		1.1		1.0
Share-based compensation expenses¹	10.2		23.5		25.8		19.7		10.5
Adjusted EBITDA	321.2		421.9		385.9		142.6		245.2
LTM²	1,271.6		1,195.6		1,060.9		932.3		995.7

¹Share-based compensation expense reflected in cost of sales and administrative expenses.

² LTM (last twelve months) as of June 30, 2026.

	TSX, NYSE – HBM 2026 No. 20

Free Cash Flow Reconciliation

(in $ millions)	Three Months Ended
	Jun. 30, 2026	Mar. 31, 2026	Jun. 30, 2025
Cash generated from operations	297.0	211.3	259.9
Adjusting items:
Change in non-cash working capital	86.9	2.6	66.0
Cash sustaining capital expenditures¹	108.3	106.4	107.2
Free cash flow	101.8	102.3	86.7
Cash sustaining capital expenditures¹
Total sustaining capital costs	80.1	87.0	88.6
Capitalized lease and equipment financing cash payments - operating sites	15.2	15.7	13.4
Community agreement cash payments	13.0	3.7	5.2
Cash sustaining capital expenditures¹	108.3	106.4	107.2

	Three Months Ended
(in $ millions)	Jun. 30, 2026	Mar. 31, 2026	Dec. 31, 2025		Sept. 30, 2025		LTM²
Cash generated from operations	297.0	211.3	290.4		113.5		831.2
Adjusting items:
Change in non-cash working capital	86.9	2.6	(127.5	)	43.2		5.2
Cash sustaining capital expenditures¹	108.3	106.4	111.9		86.4		413.0
Free cash flow	101.8	102.3	225.0		(16.1	)	413.0
Cash sustaining capital expenditures¹
Total sustaining capital costs	80.1	87.0	91.8		71.2		330.1
Capitalized lease and equipment financing cash payments - operating sites	15.2	15.7	12.5		14.3		57.7
Community agreement cash payments	13.0	3.7	7.6		0.9		25.2
Cash sustaining capital expenditures¹	108.3	106.4	111.9		86.4		413.0

¹Excludes amortization of decommissioning and restoration PP&E assets and accretion of decommissioning and restoration liabilities related to producing sites.

² LTM (last twelve months) as at June 30, 2026.

	TSX, NYSE – HBM 2026 No. 20

Copper Cash Cost Reconciliation

Consolidated	Three Months Ended
Net pounds of copper produced¹
(in thousands)	Jun. 30, 2026	Mar. 31, 2026	Jun. 30, 2025
Peru	42,871	45,356	47,863
Manitoba	5,216	5,589	3,554
British Columbia	14,231	10,628	14,626
Net pounds of copper produced	62,318	61,573	66,043

¹Contained copper in concentrate.

Consolidated	Three Months Ended
	Jun. 30, 2026				Mar. 31, 2026				Jun. 30, 2025
Cash cost per pound of copper produced	$ millions		$/lb¹		$ millions		$/lb¹		$ millions		$/lb¹
Mining	117.0		1.88		93.0		1.51		85.8		1.30
Milling	94.4		1.51		91.2		1.48		92.6		1.40
G&A	52.2		0.84		61.6		1.00		43.1		0.66
Onsite costs	263.6		4.23		245.8		3.99		221.5		3.36
Treatment & refining	(0.1	)	(0.01	)	3.1		0.05		3.3		0.05
Freight & other	21.5		0.35		22.6		0.37		20.8		0.31
Cash cost, before by-product credits	285.0		4.57		271.5		4.41		245.6		3.72
By-product credits	(309.7	)	(4.97	)	(382.1	)	(6.21	)	(247.3	)	(3.74	)
Cash cost, net of by-product credits	(24.7	)	(0.40	)	(110.6	)	(1.80	)	(1.7	)	(0.02	)

Consolidated	Three Months Ended
	Jun. 30, 2026			Mar. 31, 2026			Jun. 30, 2025
Supplementary cash cost information	$ millions		$/lb¹	$ millions		$/lb¹	$ millions		$/lb¹
By-product credits²:
Zinc	9.2		0.15	12.4		0.20	7.3		0.11
Gold³	242.6		3.89	297.4		4.83	195.8		2.96
Silver³	35.4		0.57	43.4		0.71	23.4		0.35
Molybdenum & other	22.5		0.36	28.9		0.47	20.8		0.32
Total by-product credits	309.7		4.97	382.1		6.21	247.3		3.74
Reconciliation to IFRS:
Cash cost, net of by-product credits	(24.7	)		(110.6	)		(1.7	)
By-product credits	309.7			382.1			247.3
Treatment and refining charges	0.1			(3.1	)		(3.3	)
Share-based compensation expense	1.2			2.9			0.9
Inventory adjustments	0.9			-			3.5
Change in product inventory	(17.3	)		13.0			11.4
Royalties and statutory contributions⁴	3.6			5.1			2.2
Overhead costs incurred during Peru temporary suspension (cash)	-			-			3.2
Depreciation and amortization⁵	88.8			99.9			96.4
Cost of sales⁶	362.3			389.3			359.9

¹Per pound of copper produced.

²By-product credits are computed as revenue per consolidated financial statements, including amortization of deferred revenue and pricing and volume adjustments.

³Gold and silver by-product credits do not include variable consideration adjustments with respect to stream arrangements. Variable consideration adjustments are cumulative adjustments to gold and silver stream deferred revenue primarily associated with the net change in mineral reserves and resources or amendments to the mine plan that would change the total expected deliverable ounces under the precious metal streaming arrangement. For the three months ended June 30, 2026 the variable consideration adjustments amounted to $nil (three months ended June 30, 2025 - $nil and March 31, 2026 - loss of $0.1 million).

⁴Certain of the Company's properties are subject to royalty arrangements based on mineral production at the properties. Royalties include net smelter return ("NSR") royalty and price participation agreements.

⁵ Depreciation is based on concentrate sold.

⁶ As per the consolidated financial statements.

	TSX, NYSE – HBM 2026 No. 20

Peru	Three Months Ended
(in thousands)	Jun. 30, 2026	Mar. 31, 2026	Jun. 30, 2025
Net pounds of copper produced¹	42,871	45,356	47,863

¹Contained copper in concentrate.

Peru	Three Months Ended
	Jun. 30, 2026				Mar. 31, 2026				Jun. 30, 2025
Cash cost per pound of copper produced	$ millions		$/lb		$ millions		$/lb		$ millions		$/lb
Mining	42.2		0.98		34.5		0.76		28.1		0.59
Milling	50.9		1.19		43.4		0.96		57.8		1.21
G&A	25.4		0.59		33.2		0.73		23.2		0.48
Onsite costs	118.5		2.76		111.1		2.45		109.1		2.28
Treatment & refining	(0.5	)	(0.01	)	(1.6	)	(0.04	)	(0.1	)	0.00
Freight & other	12.7		0.30		14.1		0.31		12.4		0.25
Cash cost, before by-product credits	130.7		3.05		123.6		2.72		121.4		2.53
By-product credits	(59.7	)	(1.39	)	(91.8	)	(2.02	)	(51.8	)	(1.08	)
Cash cost, net of by-product credits	71.0		1.66		31.8		0.70		69.6		1.45

Peru	Three Months Ended
	Jun. 30, 2026			Mar. 31, 2026		Jun. 30, 2025
Supplementary cash cost information	$ millions		$/lb¹	$ millions	$/lb¹	$ millions	$/lb¹
By-product credits²:
Gold³	16.3		0.38	44.9	0.99	17.3	0.36
Silver³	21.0		0.49	22.9	0.50	13.7	0.29
Molybdenum	22.4		0.52	24.0	0.53	20.8	0.43
Total by-product credits	59.7		1.39	91.8	2.02	51.8	1.08
Reconciliation to IFRS:
Cash cost, net of by-product credits	71.0			31.8		69.6
By-product credits	59.7			91.8		51.8
Treatment and refining charges	0.5			1.6		0.1
Inventory adjustments	-			-		1.1
Share-based compensation expenses	0.2			0.5		0.2
Change in product inventory	(20.3	)		7.6		4.0
Royalties and statutory contributions	1.3			1.9		1.0
Depreciation and amortization⁴	45.4			61.4		56.0
Cost of sales⁵	157.8			196.6		183.8

¹Per pound of copper produced.

²By-product credits are computed as revenue per consolidated financial statements, including amortization of deferred revenue and pricing and volume adjustments.

³Gold and silver by-product credits do not include variable consideration adjustments with respect to stream arrangements.

⁴Depreciation is based on concentrate sold.

⁵As per the consolidated interim financial statements.

British Columbia	Three Months Ended
(in thousands)	Jun. 30, 2026	Mar. 31, 2026	Jun. 30, 2025
Net pounds of copper produced¹	14,231	10,628	14,626

¹Contained copper in concentrate.

	TSX, NYSE – HBM 2026 No. 20

British Columbia	Three Months Ended
	Jun. 30, 2026				Mar. 31, 2026				Jun. 30, 2025
Cash cost per pound of copper produced	$ millions		$/lb		$ millions		$/lb		$ millions		$/lb
Mining	31.3		2.20		16.2		1.53		24.2		1.65
Milling	27.2		1.91		31.5		2.96		21.4		1.46
G&A	7.9		0.56		8.4		0.79		6.1		0.42
Onsite costs	66.4		4.67		56.1		5.28		51.7		3.53
Treatment & refining	(0.6	)	(0.04	)	2.1		0.20		2.1		0.14
Freight & other	3.5		0.24		2.8		0.26		3.3		0.24
Cash cost, before by-product credits	69.3		4.87		61.0		5.74		57.1		3.91
By-product credits	(23.5	)	(1.65	)	(35.4	)	(3.33	)	(22.2	)	(1.52	)
Cash cost, net of by-product credits	45.8		3.22		25.6		2.41		34.9		2.39

British Columbia	Three Months Ended
	Jun. 30, 2026			Mar. 31, 2026			Jun. 30, 2025
Supplementary cash cost information	$ millions		$/lb¹	$ millions		$/lb¹	$ millions		$/lb¹
By-product credits²:
Gold	20.7		1.45	30.6		2.88	19.8		1.35
Silver	2.8		0.20	4.8		0.45	2.4		0.17
Total by-product credits	23.5		1.65	35.4		3.33	22.2		1.52
Reconciliation to IFRS:
Cash cost, net of by-product credits	45.8			25.6			34.9
By-product credits	23.5			35.4			22.2
Treatment and refining charges	0.6			(2.1	)		(2.1	)
Share-based compensation expenses	0.6			0.6			0.2
Change in product inventory	(2.6	)		11.3			3.6
Inventory adjustments	-			-			1.4
Royalties	2.3			3.2			1.2
Depreciation and amortization³	22.2			18.5			16.8
Cost of sales⁴	92.4			92.5			78.2

¹Per pound of copper produced.

²By-product credits are computed as revenue per consolidated financial statements, including amortization of deferred revenue and pricing and volume adjustments.

³Depreciation is based on concentrate sold.

⁴ As per consolidated interim financial statements.

	TSX, NYSE – HBM 2026 No. 20

Sustaining and All-in Sustaining Cash Cost Reconciliation

Consolidated	Three Months Ended
	Jun. 30, 2026				Mar. 31, 2026				Jun. 30, 2025
All-in sustaining cash cost per pound of copper produced	$ millions		$/lb		$ millions		$/lb		$ millions		$/lb
Cash cost, net of by-product credits	(24.7	)	(0.40	)	(110.6	)	(1.80	)	(1.7	)	(0.02	)
Cash sustaining capital expenditures	107.9		1.73		105.2		1.71		108.3		1.64
Royalties	3.6		0.06		5.1		0.08		2.2		0.03
Sustaining cash cost, net of by-product credits	86.8		1.39		(0.3	)	0.00		108.8		1.65
Corporate selling and administrative expenses & regional costs	22.0		0.35		38.1		0.62		22.1		0.33
Accretion and amortization of decommissioning and community agreements¹	3.6		0.06		6.5		0.11		3.2		0.05
All-in sustaining cash cost, net of by-product credits	112.4		1.80		44.3		0.73		134.1		2.03
Reconciliation to property, plant and equipment additions:
Property, plant and equipment additions	160.0				109.5				93.6
Capitalized stripping net additions	49.8				73.0				53.8
Total accrued capital additions	209.8				182.5				147.4
Less other non-sustaining capital costs²	129.7				95.5				58.8
Total sustaining capital costs	80.1				87.0				88.6
Capitalized lease & equipment financing cash payments - operating sites	15.2				15.1				13.4
LOM Community agreement cash payments	10.1				0.6				4.1
Accretion and amortization of decommissioning and restoration obligations³	2.5				2.5				2.2
Cash sustaining capital expenditures	107.9				105.2				108.3

¹Includes accretion of decommissioning relating to non-productive sites, and accretion and amortization of community agreements capitalized to Other assets.

³ Includes amortization of decommissioning and restoration PP&E assets and accretion of decommissioning and restoration liabilities related to producing sites.

	TSX, NYSE – HBM 2026 No. 20

Peru	Three Months Ended
	Jun. 30, 2026		Mar. 31, 2026		Jun. 30, 2025
Sustaining cash cost per pound of copper produced	$ millions	$/lb	$ millions	$/lb	$ millions	$/lb
Cash cost, net of by-product credits	71.0	1.66	31.8	0.70	69.6	1.45
Cash sustaining capital expenditures	43.8	1.02	30.7	0.69	55.1	1.15
Royalties	1.3	0.03	1.9	0.04	1.0	0.03
Sustaining cash cost per pound of copper produced	116.1	2.71	64.4	1.43	125.7	2.63

British Columbia	Three Months Ended
	Jun. 30, 2026		Mar. 31, 2026		Jun. 30, 2025
Sustaining cash cost per pound of copper produced	$ millions	$/lb	$ millions	$/lb	$ millions	$/lb
Cash cost, net of by-product credits	45.8	3.22	25.6	2.41	34.9	2.39
Cash sustaining capital expenditures	40.6	2.85	54.2	5.10	39.6	2.71
Royalties	2.3	0.16	3.2	0.30	1.2	0.08
Sustaining cash cost per pound of copper produced	88.7	6.23	83.0	7.81	75.7	5.18

Gold Cash Cost and Sustaining Cash Cost Reconciliation

Manitoba	Three Months Ended
(in thousands)	Jun. 30, 2026	Mar. 31, 2026	Jun. 30, 2025
Net ounces of gold produced¹	40,344	47,743	43,235

¹Contained gold in concentrate and doré.

Manitoba	Three Months Ended
	Jun. 30, 2026				Mar. 31, 2026				Jun. 30, 2025
Cash cost per ounce of gold produced	$millions		$/oz		$millions		$/oz		$millions		$/oz
Mining	43.5		1,078		42.3		886		33.5		775
Milling	16.3		404		16.3		341		13.4		310
G&A	18.9		469		20.0		419		13.8		319
Onsite costs	78.7		1,951		78.6		1,646		60.7		1,404
Treatment & refining	1.0		25		2.6		55		1.3		30
Freight & other	5.3		131		5.7		119		5.1		118
Cash cost, before by-product credits	85.0		2,107		86.9		1,820		67.1		1,552
By-product credits	(53.7	)	(1,331	)	(67.4	)	(1,412	)	(36.4	)	(842	)
Gold cash cost, net of by-product credits	31.3		776		19.5		408		30.7		710

	TSX, NYSE – HBM 2026 No. 20

Manitoba	Three Months Ended
	Jun. 30, 2026			Mar. 31, 2026			Jun. 30, 2025
Supplementary cash cost information	$millions		$/oz¹	$millions		$/oz¹	$millions		$/oz¹
By-product credits²:
Copper	32.8		813	34.4		720	21.8		504
Zinc	9.2		228	12.4		260	7.3		169
Silver	11.6		288	15.7		329	7.3		169
Other	0.1		2	4.9		103	-		-
Total by-product credits	53.7		1,331	67.4		1,412	36.4		842
Reconciliation to IFRS:
Cash cost, net of by-product credits	31.3			19.5			30.7
By-product credits	53.7			67.4			36.4
Treatment and refining charges	(1.0	)		(2.6	)		(1.3	)
Inventory adjustments	0.9			-			1.0
Share-based compensation expenses	0.4			1.8			0.5
Change in product inventory	5.6			(5.9	)		3.8
Depreciation and amortization³	21.2			20.0			23.6
Cost of sales⁴	112.1			100.2			97.9

¹Per ounce of gold produced.

²By-product credits are computed as revenue per consolidated financial statements, amortization of deferred revenue, pricing and volume adjustments.

³Depreciation is based on concentrate sold.

⁴As per consolidated interim financial statements.

Manitoba

Three Months Ended

Jun. 30, 2026

Mar. 31, 2026

Jun. 30, 2025

Sustaining cash cost per pound of gold produced

$millions

$/oz

$millions

$/oz

$millions

$/oz

Gold cash cost, net of by-product credits

31.3

776

19.5

408

30.7

710

Cash sustaining capital expenditures

23.5

582

20.3

425

13.6

315

Sustaining cash cost per pound of gold produced

54.8

1,358

39.8

833

44.3

1,025

	TSX, NYSE – HBM 2026 No. 20

Combined Unit Cost Reconciliation

Peru	Three Months Ended
(in millions except ore tonnes milled and unit cost per tonne)
Combined unit cost per tonne processed	Jun. 30, 2026		Mar. 31, 2026		Jun. 30, 2025
Mining	42.2		34.5		28.1
Milling	50.9		43.4		57.8
G&A¹	25.4		33.2		23.2
Other G&A²	(8.4	)	(16.3	)	(6.4	)
Unit cost	110.1		94.8		102.7
Tonnes ore milled	7,828		8,164		7,559
Combined unit cost per tonne	14.06		11.61		13.59
Reconciliation to IFRS:
Unit cost	110.1		94.8		102.7
Freight & other	12.7		14.1		12.4
Inventory adjustments	-		-		1.1
Other G&A	8.4		16.3		6.4
Share-based compensation expenses	0.2		0.5		0.2
Change in product inventory	(20.3	)	7.6		4.0
Royalties and statutory contributions	1.3		1.9		1.0
Depreciation and amortization	45.4		61.4		56.0
Cost of sales³	157.8		196.6		183.8

¹G&A as per cash cost reconciliation above.

²Other G&A primarily includes profit sharing costs.

³As per consolidated interim financial statements.

British Columbia	Three Months Ended
(in millions except tonnes ore milled and unit cost per tonne)
Combined unit cost per tonne processed	Jun. 30, 2026		Mar. 31, 2026	Jun. 30, 2025
Mining	31.3		16.2	24.2
Milling	27.2		31.5	21.4
G&A¹	7.9		8.4	6.1
Unit cost	66.4		56.1	51.7
USD/CAD implicit exchange rate	1.39		1.38	1.38
Unit cost - C$	92.3		77.7	71.1
Tonnes ore milled	3,616		3,078	2,900
Combined unit cost per tonne - C$	25.52		25.23	24.51
Reconciliation to IFRS:
Unit cost	66.4		56.1	51.7
Freight & other	3.5		2.8	3.3
Share-based compensation expenses	0.6		0.6	0.2
Change in product inventory	(2.6	)	11.3	3.6
Inventory adjustments	-		-	1.4
Royalties	2.3		3.2	1.2
Depreciation and amortization	22.2		18.5	16.8
Cost of sales²	92.4		92.5	78.2

¹G&A as per cash cost reconciliation above

² As per consolidated interim financial statements.

	TSX, NYSE – HBM 2026 No. 20

Manitoba	Three Months Ended
(in millions except ore tonnes milled and unit cost per tonne)
Combined unit cost per tonne processed	Jun. 30, 2026		Mar. 31, 2026		Jun. 30, 2025
Mining	43.5		42.3		33.5
Milling	16.3		16.3		13.4
G&A ¹	18.9		20.0		13.8
Less: Other G&A related to profit sharing costs	(9.6	)	(11.9	)	(7.2	)
Unit cost	69.1		66.7		53.5
USD/CAD implicit exchange rate	1.38		1.37		1.38
Unit cost - C$	95.6		91.5		73.9
Tonnes ore milled	318,514		360,384		307,138
Combined unit cost per tonne - C$	300		254		241
Reconciliation to IFRS:
Unit cost	69.1		66.7		53.5
Freight & other	5.3		5.7		5.1
Other G&A related to profit sharing	9.6		11.9		7.2
Share-based compensation expenses	0.4		1.8		0.5
Inventory adjustments	0.9		-		1.0
Change in product inventory	5.6		(5.9	)	3.8
Overhead costs incurred during Manitoba temporary suspension (cash)	-		-		3.2
Depreciation and amortization	21.2		20.0		23.6
Cost of sales²	112.1		100.2		97.9

¹G&A as per cash cost reconciliation above.

² As per consolidated interim financial statements.

	TSX, NYSE – HBM 2026 No. 20

Forward-Looking Information

This news release contains forward-looking information within the meaning of applicable Canadian and United States securities legislation. All information contained in this news release, other than statements of current and historical fact, is forward-looking information. Often, but not always, forward-looking information can be identified by the use of words such as "plans", "expects", "budget", "guidance", "scheduled", "estimates", "forecasts", "strategy", "target", "intends", "objective", "goal", "understands", "anticipates" and "believes" (and variations of these or similar words) and statements that certain actions, events or results "may", "could", "would", "should", "might" "occur" or "be achieved" or "will be taken" (and variations of these or similar expressions). All of the forward-looking information in this news release is qualified by this cautionary note.

● the ability to achieve production, cost and capital and exploration expenditure guidance;

	TSX, NYSE – HBM 2026 No. 20

● no significant interruptions to Hudbay's operations due to social or political unrest in the regions Hudbay operates, including the navigation of the complex political and social environment in Peru and the resolution of grievances raised by local communities and their residents;

● the ability to consummate the definitive agreement with Wheaton in respect of the enhanced precious metals stream at Copper World;

● no interruptions to Hudbay's plans for advancing the Copper World project, including with respect to the completion of the DFS, timing of a project sanctioning decision, and any successful challenges to the Copper World permits;

● no interruptions to Hudbay's plans for advancing New Ingerbelle, including with respect to any challenges to the New Ingerbelle permits;

● Hudbay's ability to successfully advance and complete the optimization of the Copper Mountain operations, and develop and maintain good relations with key stakeholders;

● the ability to execute on its exploration plans and to advance related drill plans;

● the ability to advance the exploration program at the Maria Reyna and Caballito properties;

● the success of mining, processing, exploration and development activities;

● the scheduled maintenance and availability of Hudbay's processing facilities;

● the accuracy of geological, mining and metallurgical estimates;

● anticipated metals prices and the costs of production;

● the supply and demand for metals Hudbay produces;

● the supply and availability of all forms of energy and fuels at reasonable prices;

● no significant unanticipated operational or technical difficulties;

● no significant interruptions to operations due to adverse effects from extreme weather events, including forest fires that have affected and may continue to affect the regions in which Hudbay operates;

● the execution of Hudbay's business and growth strategies, including the success of its strategic investments and initiatives;

● the availability of additional financing, if needed;

● the ability to deleverage and repay debt, as needed;

● the ability to complete project targets on time and on budget and other events that may affect Hudbay's ability to develop Hudbay's projects;

● the timing and receipt of various regulatory and governmental approvals;

● the availability of personnel for Hudbay's exploration, development and operational projects and ongoing employee relations;

● maintaining good relations with the employees at Hudbay's operations;

● maintaining good relations with the labour unions that represent certain of Hudbay employees in Manitoba and Peru;

● maintaining good relations with the communities in which Hudbay operates, including the neighbouring Indigenous communities and local governments;

● no significant unanticipated challenges with stakeholders at Hudbay's various projects;

● no significant unanticipated events or changes relating to regulatory, environmental, health and safety matters;

● no contests over title to Hudbay's properties, including as a result of rights or claimed rights of Indigenous peoples or challenges to the validity of Hudbay's unpatented mining claims;

● the timing and possible outcome of pending litigation and no significant unanticipated litigation;

● certain tax matters, including, but not limited to current tax laws and regulations, changes in taxation policies and the refund of certain value added taxes from the Canadian and Peruvian governments; and

● no significant and continuing adverse changes in general economic conditions or conditions in the financial markets (including commodity prices and foreign exchange rates).

The risks, uncertainties, contingencies and other factors that may cause actual results to differ materially from those expressed or implied by the forward-looking information may include, but are not limited to, risks related to the failure to effectively advance and complete the optimization of the Copper Mountain mine operations including with respect to the primary SAG mill repairs and related ramp-up plans, political and social risks in the regions Hudbay operates, including the complex political and social environment in Peru and potential disruptions to operations arising from community protests and grievances, risks generally associated with the mining industry and the current geopolitical environment, including future commodity prices, the potential implementation or expansion of tariffs, currency and interest rate fluctuations, energy and consumable prices, supply chain constraints and general cost escalation in the current inflationary environment, uncertainties related to the development and operation of Hudbay's projects, the risk of an indicator of impairment or impairment reversal relating to a material mineral property, risks associated with the development of new projects, risks associated with acquisitions, investments and other strategic transactions including but not limited to the recent acquisition of ASCU, risks related to the Copper World project, including the risk of capital cost escalation, risks related to ongoing litigation in respect of the project's air permit and certain land rights, risks from community opposition, project delivery risks, joint venture risks and financing risks, risks related to the Lalor mine plan, including the ability to convert inferred mineral resource estimates to higher confidence categories, dependence on key personnel and employee and union relations, risks related to political or social instability, unrest or change, risks in respect of Indigenous and community relations, rights and title claims, operational risks and hazards, including the cost of maintaining and upgrading Hudbay's tailings management facilities and any unanticipated environmental, industrial and geological events and developments and the inability to insure against all risks (including any unanticipated significant interruptions to operations due to adverse effects from extreme weather events), failure of plant, equipment, processes, transportation and other infrastructure to operate as anticipated, compliance with government and environmental regulations, including permitting requirements and anti-bribery legislation, depletion of Hudbay's reserves, volatile financial markets and interest rates that may affect Hudbay's ability to obtain additional financing on acceptable terms, the failure to obtain required approvals or clearances from government authorities on a timely basis, uncertainties related to the geology, continuity, grade and estimates of mineral reserves and resources, and the potential for variations in grade and recovery rates, uncertain costs of reclamation activities, Hudbay's ability to comply with Hudbay's pension and other post-retirement obligations, Hudbay's ability to abide by the covenants in Hudbay's debt instruments and other material contracts, tax refunds, hedging transactions, cybersecurity risks and risks related to the reliability and security of Hudbay's information technology and operational technology systems, including risks arising from cyber-attacks, ransomware, phishing and other malware, risks associated with the use of artificial intelligence technologies, as well as the risks discussed under the heading "Risk Factors" in Hudbay's most recent Annual Information Form which is available on the Company's SEDAR+ profile at www.sedarplus.ca and the Company's EDGAR profile at www.sec.gov.

	TSX, NYSE – HBM 2026 No. 20

Should one or more risk, uncertainty, contingency or other factor materialize or should any factor or assumption prove incorrect, actual results could vary materially from those expressed or implied in the forward-looking information. Accordingly, you should not place undue reliance on forward-looking information. Hudbay does not assume any obligation to update or revise any forward-looking information after the date of this news release or to explain any material difference between subsequent actual events and any forward-looking information, except as required by applicable law.

Note to United States Investors

This news release has been prepared in accordance with the requirements of the securities laws in effect in Canada, which may differ materially from the requirements of United States securities laws applicable to U.S. issuers.

	TSX, NYSE – HBM 2026 No. 20

About Hudbay

Hudbay (TSX, NYSE: HBM) is a copper-focused critical minerals mining company with three long-life operations and a world-class pipeline of copper growth projects in tier-one mining jurisdictions of Canada, Peru and the United States.

Hudbay's operating portfolio includes the Constancia mine in Cusco (Peru), the Snow Lake operations in Manitoba (Canada) and the Copper Mountain mine in British Columbia (Canada). Copper is the primary metal produced by the Company, which is complemented by meaningful gold production and by-product zinc, silver and molybdenum. Hudbay's growth pipeline includes the Copper World project in Arizona (United States), the Cactus project in Arizona (United States), the Mason project in Nevada (United States), the Llaguen project in La Libertad (Peru) and several expansion and exploration opportunities near its existing operations.

The value Hudbay creates and the impact it has is embodied in its purpose statement: "We care about our people, our communities and our planet. Hudbay provides the metals the world needs. We work sustainably, transform lives and create better futures for communities." Hudbay's mission is to create sustainable value and strong returns by leveraging its core strengths in community relations, focused exploration, mine development and efficient operations.

For further information, please contact:

Candace Brûlé

Senior Vice President, Capital Markets & Corporate Affairs

(416) 362-8181

investor.relations@hudbay.com

____________________

ⁱ Adjusted net earnings - attributable to owners and adjusted net earnings per share - attributable to owners, adjusted EBITDA, cash cost, sustaining cash cost, all-in sustaining cash cost per pound of copper produced, net of by-product credits, cash cost, sustaining cash cost per ounce of gold produced, net of by-product credits, combined unit cost, net debt, net debt to adjusted EBITDA ratio and free cash flow are non-GAAP financial performance measures with no standardized definition under IFRS. For further information and a detailed reconciliation, please see the discussion under the "Non-GAAP Financial Performance Measures" section of this news release.

ⁱⁱ Liquidity includes $890.9 million in cash and cash equivalents as well as undrawn availability of $153.7 million under Hudbay's revolving credit facilities.

FORM 52-109F2
CERTIFICATION OF INTERIM FILINGS
FULL CERTIFICATE

I, Peter Kukielski, Chief Executive Officer of Hudbay Minerals Inc., certify the following:

1. Review: I have reviewed the interim financial report and interim MD&A (together, the "interim filings") of Hudbay Minerals Inc. (the "issuer") for the interim period ended June 30, 2026.

2. No misrepresentations: Based on my knowledge, having exercised reasonable diligence, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings.

3. Fair presentation: Based on my knowledge, having exercised reasonable diligence, the interim financial report together with the other financial information included in the interim filings fairly present in all material respects the financial condition, financial performance and cash flows of the issuer, as of the date of and for the periods presented in the interim filings.

4. Responsibility: The issuer's other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as those terms are defined in National Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings, for the issuer.

5. Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer's other certifying officer and I have, as at the end of the period covered by the interim filings

(a) designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that

(i) material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and

(ii) information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted by it under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and

(b) designed ICFR, or caused it to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer's GAAP.

5.1 Control framework: The control framework the issuer's other certifying officer and I used to design the issuer's ICFR is the Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

5.2 N/A

5.3 N/A

6. Reporting changes in ICFR: The issuer has disclosed in its interim MD&A any change in the issuer's ICFR that occurred during the period beginning on April 1, 2026 and ended on June 30, 2026 that has materially affected, or is reasonably likely to materially affect, the issuer's ICFR.

Date: July 29, 2026

(signed) "Peter Kukielski"
Peter Kukielski
Chief Executive Officer

FORM 52-109F2
CERTIFICATION OF INTERIM FILINGS
FULL CERTIFICATE

I, Eugene Lei, President and Chief Financial Officer of Hudbay Minerals Inc., certify the following:

1. Review: I have reviewed the interim financial report and interim MD&A (together, the "interim filings") of Hudbay Minerals Inc. (the "issuer") for the interim period ended June 30, 2026.

5. Design: Subject to the limitations, if any, described in paragraphs 5.2 and 5.3, the issuer's other certifying officer and I have, as at the end of the period covered by the interim filings

(a) designed DC&P, or caused it to be designed under our supervision, to provide reasonable assurance that

(i) material information relating to the issuer is made known to us by others, particularly during the period in which the interim filings are being prepared; and

5.2 N/A

5.3 N/A

Date: July 29, 2026

(signed) "Eugene Lei"
Eugene Lei
President and Chief Financial Officer

Source: View Original Filing on SEC EDGAR

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Hudbay Minerals (NYSE: HBM) lifts H1 profit and expands copper assets

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