Hudbay Minerals (NYSE: HBM) 2025 profit soars as debt falls and EPS jumps

Rhea-AI Filing Summary

Hudbay Minerals Inc. filed a Form 6-K providing its audited 2025 IFRS financial statements and confirming effective internal controls. Deloitte issued unqualified opinions on both the financial statements and internal control over financial reporting.

For 2025, Hudbay generated revenue of $2,211.0 million, up from $2,021.2 million in 2024. Net income rose sharply to $564.3 million, versus $67.8 million a year earlier, with earnings attributable to owners of the company of $568.5 million, or $1.44 per basic and diluted share, compared with $0.20 in 2024. Results benefited from a sizeable impairment reversal of $322.3 million.

Operating cash flow before working capital was $764.3 million, leading to net cash from operating activities of $707.3 million. Hudbay invested $466.7 million in property, plant and equipment and used cash to repurchase senior notes and reduce long-term debt, which declined to $536.5 million from $1,107.5 million. Total equity attributable to owners increased to $3,231.0 million, and non‑controlling interests were eliminated following the Copper Mountain buyout. An annual goodwill test for the British Columbia cash-generating unit concluded there was no impairment.

Positive

• Strong earnings growth: Net income rose to $564.3 million from $67.8 million, and EPS increased to $1.44 from $0.20, supported by higher gross profit and a large impairment reversal.
• Balance sheet improvement: Long-term debt decreased to $536.5 million from $1,107.5 million, while equity attributable to owners increased to $3,231.0 million, indicating lower leverage and stronger capitalization.

Negative

• None.

Insights

Mining equity analyst

Hudbay posts much stronger 2025 profit, boosted by impairment reversal and debt reduction.

Hudbay Minerals reported 2025 revenue of $2,211.0 million and net income of $564.3 million, a large increase from $67.8 million in 2024. Earnings per share rose to $1.44 from $0.20, reflecting stronger operations and notably a $322.3 million impairment reversal.

Operating cash flow of $707.3 million supported significant capital spending of $466.7 million and balance sheet actions. Long‑term debt fell to $536.5 million from $1,107.5 million, partly via $102.1 million of senior note repurchases, while equity attributable to owners climbed to $3,231.0 million.

Deloitte issued unqualified opinions on both the 2025 financial statements and internal control over financial reporting as of December 31, 2025, which helps support confidence in the reported numbers. Investors comparing performance to 2024 should note that the impairment reversal is a one‑time non‑cash gain; future filings will clarify whether higher underlying cash generation is sustained without similar items.

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 February 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 February 20, 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) Audited Consolidated Financial Statements for the years ended December 31, 2025 and 2024, (2) Management's Discussion and Analysis for the year ended December 31, 2025, (3) News Release dated February 20, 2026.

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

• Exhibit 99.1 — Audited Consolidated Financial Statements for the years ended December 31, 2025 and 2024

• Exhibit 99.2 — Management's Discussion and Analysis for the year ended December 31, 2025

• Exhibit 99.3 — News Release dated February 20, 2026

2

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:	Chief Financial Officer

Date: February 23, 2026

3

EXHIBIT INDEX

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

Exhibit		Description
99.1		Audited Consolidated Financial Statements for the years ended December 31, 2025 and 2024
99.2		Management's Discussion and Analysis for the year ended December 31, 2025
99.3		News Release dated February 20, 2026

4

Consolidated Financial Statements

(In US dollars)

HUDBAY MINERALS INC.

For the years ended December 31, 2025 and 2024

MANAGEMENT'S REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

Management of Hudbay Minerals Inc. ("Hudbay" or the "Company") is responsible for establishing and maintaining internal control over financial reporting ("ICFR").

Under the supervision of and with the participation of the Chief Executive Officer and the Chief Financial Officer, Hudbay's management assessed the effectiveness of the Company's ICFR as of December 31, 2025 based upon the Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on this evaluation, management concluded that Hudbay's ICFR was effective as of December 31, 2025.

The effectiveness of the Company's ICFR as of December 31, 2025 has been audited by Deloitte LLP, Independent Registered Public Accounting Firm, as stated in their report immediately preceding the Company's audited consolidated financial statements for the year ended December 31, 2025.

Peter Kukielski	Eugene Lei
President and Chief Executive Officer	Chief Financial Officer

Toronto, Canada

February 19, 2026

Report of Independent Registered Public Accounting Firm

To the shareholders and the Board of Directors of Hudbay Minerals Inc.

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Hudbay Minerals Inc. and subsidiaries (the "Company") as at December 31, 2025 and 2024, the related consolidated statements of income, comprehensive income, changes in equity, and cash flows, for each of the two years in the period ended December 31, 2025, and the related notes (collectively referred to as the "financial statements"). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as at December 31, 2025 and 2024, and its financial performance and its cash flows for each of the two years in the period ended December 31, 2025, in accordance with IFRS Accounting Standards as issued by the International Accounting Standards Board.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission and our report dated February 19, 2026, expressed an unqualified opinion on the Company's internal control over financial reporting.

Basis for Opinion

These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company's financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current-period audit of the financial statements that were communicated or required to be communicated to the audit committee and that (1) relate to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Impairment - Assessment of Whether Indicators of Impairment or Impairment Reversal Exist in Non- financial Assets - Refer to Notes 2(d) and 3(i) to the financial statements

Critical Audit Matter Description

The Company's determination of whether an indicator of impairment or impairment reversal exists in non-financial assets at the cash generating unit ("CGU") level requires significant management judgment.

While there are several inputs that are required to determine whether or not an indicator of impairment or impairment reversal exists, the judgments with the highest degree of subjectivity are the future long- term copper price and the discount rates. Auditing these estimates and inputs required a high degree of subjectivity in applying audit procedures and in evaluating the results of those procedures. This resulted in an increased extent of audit effort, including the involvement of fair value specialists.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the future long-term copper price, and the discount rates in the assessment of indicators of impairment or impairment reversal included the following, among others:

• Evaluated the effectiveness of controls over management's assessment of the indicators of impairment or impairment reversal.

• With the assistance of fair value specialists:

- Evaluated the future long-term copper price by comparing management's forecasts to third party forecasts, and

- Evaluated the reasonableness of the discount rates by comparing the key inputs to independent market data.

British Columbia CGU Annual Goodwill Impairment Test - Refer to Notes 2(d), 3(i) and 13 of the financial statements

Critical Audit Matter Description

On June 20, 2023, the Company acquired 100% of the issued and outstanding shares of Copper Mountain Mining Corporation. Goodwill resulted from the purchase price allocation associated with the Copper Mountain acquisition, which was allocated to the British Columbia CGU. The Company tested the goodwill of the British Columbia CGU as at July 1, 2025 for impairment by determining the recoverable amount using a discounted cash flow model. The discounted cash flow model required management to make significant estimates and assumptions related to future short-term and long-term copper price, production based on current estimates of recoverable resources, value beyond proven and probable ("VBPP"), discount rate, future foreign exchange rates, and future operating and capital costs. The Company determined that there was no impairment of the British Columbia CGU's goodwill based on its annual goodwill impairment test.

While there are several estimates and assumptions that are required to determine the recoverable amount of the British Columbia CGU as at July 1, 2025, the estimates and assumptions with the highest degree of subjectivity are future short-term and long-term copper price, VBPP, discount rate, and future foreign exchange rates. Auditing these estimates and assumptions required a high degree of auditor judgment in applying audit procedures and in evaluating the results of those procedures. This resulted in an increased extent of audit effort, including the involvement of fair value specialists.

How the Critical Audit Matter Was Addressed in the Audit

Our audit procedures related to the future short-term and long-term copper price, VBPP, discount rate, and future foreign exchange rates used to determine the recoverable amount of the British Columbia CGU included the following, among others:

• Evaluated the effectiveness of relevant controls over management's determination of the future short-term and long-term copper price, VBPP, discount rate and future foreign exchange rates.

• With the assistance of fair value specialists:

- Evaluated the future short-term and long-term copper price by comparing management's forecasts to third party forecasts,

- Evaluated the reasonableness of the VBPP by developing a range of independent VBPP valuation estimates from market transactions and comparing to the VBPP valuation selected by management,

- Evaluated the reasonableness of the discount rate by testing the source information underlying the determination of the discount rate and developed a range of independent estimates for the discount rate and compared to the discount rate selected by management, and

- Evaluated the reasonableness of the future foreign exchange rates by comparing our independent research of the forecasted rate to management's assumed rates.

/s/ Deloitte LLP

Chartered Professional Accountants

Licensed Public Accountants

Toronto, Canada

February 19, 2026

We have served as the Company's auditor since 2005.

Report of Independent Registered Public Accounting Firm

To the shareholders and the Board of Directors of Hudbay Minerals Inc.

Opinion on Internal Control over Financial Reporting

We have audited the internal control over financial reporting of Hudbay Minerals Inc. and subsidiaries (the "Company") as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2025, based on criteria established in Internal Control - Integrated Framework (2013) issued by COSO.

We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated financial statements as at and for the year ended December 31, 2025, of the Company and our report dated February 19, 2026, expressed an unqualified opinion on those financial statements.

Basis for Opinion

The Company's management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Report on Internal Control over Financial Reporting.  Our responsibility is to express an opinion on the Company's internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.

Definition and Limitations of Internal Control over Financial Reporting

A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

/s/ Deloitte LLP

Chartered Professional Accountants

Licensed Public Accountants

Toronto, Canada

February 19, 2026

HUDBAY MINERALS INC.
Consolidated Balance Sheets
(In millions of US dollars)

			Dec. 31,			Dec. 31,
	Note		2025			2024
Assets
Current assets
Cash and cash equivalents	7	$	568.9		$	541.8
Short-term investments	8		-			40.0
Trade and other receivables	9		377.8			235.5
Inventories	10		199.2			197.4
Prepaid expenses and other current assets			15.2			17.4
Other financial assets	11		0.8			15.3
Taxes receivable			1.2			1.1
			1,163.1			1,048.5
Taxes receivable			16.1			12.9
Inventories	10		21.6			16.6
Other financial assets	11		130.9			12.1
Intangibles and other assets	12		58.6			44.3
Property, plant and equipment	14		4,693.9			4,181.4
Deferred tax assets	24b		66.5			102.6
Goodwill	13		72.6			69.2
		$	6,223.3		$	5,487.6
Liabilities
Current liabilities
Trade and other payables	15	$	342.8		$	270.2
Taxes payable			117.4			100.7
Other liabilities	16		94.7			34.4
Other financial liabilities	17		122.9			38.3
Lease liabilities	18		26.7			30.5
Current portion of long-term debt	19		472.1			-
Deferred revenue	20		52.1			63.1
			1,228.7			537.2
Other financial liabilities	17		155.0			114.4
Lease liabilities	18		29.3			44.3
Long-term debt	19		536.5			1,107.5
Deferred revenue	20		265.0			309.1
Pension obligations	22		7.5			6.2
Other employee benefits	23		82.4			80.3
Environmental and other provisions	21		312.6			300.8
Deferred tax liabilities	24b		375.3			340.4
			2,992.3			2,840.2
Equity
Share capital	25b		2,668.2			2,641.3
Reserves			102.3			14.3
Retained earnings			460.5			(102.4	)
Equity attributable to owners of the Company			3,231.0			2,553.2
Non-controlling interest	5		-			94.2
		$	6,223.3		$	5,487.6
Commitments (note 30)

1

HUDBAY MINERALS INC.
Consolidated Statements of Income
(In millions of US dollars, except per share amounts)

			Year ended December 31,
	Note		2025			2024
Revenue	6a	$	2,211.0		$	2,021.2
Cost of sales
Mine operating costs			1,028.1			1,040.8
Depreciation and amortization	6b		439.7			426.6
			1,467.8			1,467.4
Gross profit			743.2			553.8
Selling and administrative expenses			94.7			57.0
Exploration expenses			46.3			42.6
Other operating expenses	6e		7.8			57.4
Re-evaluation adjustment - environmental provision	21		0.2			(3.5	)
Impairment reversal	6f		(322.3	)		-
Results from operating activities			916.5			400.3
Consideration received from sale of non-core project	6g		(14.9	)		-
Net interest expense on long term debt	6h		60.7			69.8
Accretion on streaming arrangements	6h		19.9			24.2
Change in fair value of financial instruments	6h		(52.9	)		16.6
Other net finance (income) expenses	6h		(8.3	)		38.1
Other expenses			4.5			148.7
Income before tax			912.0			251.6
Tax expense	24		347.7			183.8
Net income for the year		$	564.3		$	67.8
Attributable to:
Owners of the Company		$	568.5		$	76.7
Non-controlling interest			(4.2	)		(8.9	)
Net income for the year		$	564.3		$	67.8
Earnings per share attributable to owners
Basic and diluted		$	1.44		$	0.20
Weighted average number of common shares outstanding:
Basic	27		395,521,903			376,785,518
Diluted	27		396,648,796			377,291,211

2

HUDBAY MINERALS INC.
Consolidated Statements of Comprehensive Income
(In millions of US dollars)

		Year ended December 31,
		2025			2024
Net income for the year	$	564.3		$	67.8
Other comprehensive income:
Item that will be reclassified subsequently to profit or loss:
Recognized directly in equity:
Net gain (loss) on translation of foreign currency balances		25.7			(49.9	)
Items that will not be reclassified subsequently to profit or loss:
Recognized directly in equity:
Gold prepayment revaluation		-			4.3
Tax effect		-			(1.1	)
Remeasurement - actuarial gain		7.9			25.7
Tax effect		(0.7	)		(2.0	)
		7.2			26.9
Other comprehensive income (loss) net of tax, for the year		32.9			(23.0	)
Total comprehensive income for the year	$	597.2		$	44.8
Attributable to:
Owners of the Company		598.2			60.6
Non-controlling interest		(1.0	)		(15.8	)
Total comprehensive income for the year	$	597.2		$	44.8

3

HUDBAY MINERALS INC.
Consolidated Statements of Cash Flows
(In millions of US dollars)

			Year ended December 31,
	Note		2025			2024
Cash generated from operating activities:
Net income for the year		$	564.3		$	67.8
Items not affecting cash:
Tax expense	24		347.7			183.8
Depreciation and amortization	6b		441.2			428.0
Share-based compensation	6c		61.3			19.3
Net finance expenses	6h		19.4			148.7
Inventory adjustments	10		4.1			2.9
Amortization of deferred revenue and variable consideration	6a		(75.0	)		(70.5	)
Pension and other employee benefit payments, net of accruals			5.3			11.9
Amortization of community agreements			12.4			13.7
Re-evaluation adjustment - environmental obligation	21		0.2			(3.5	)
Write-down/loss on disposal of PP&E	6e		3.5			27.4
Impairment reversal	6f		(322.3	)		-
Decommissioning and restoration payments	21		(1.7	)		(2.1	)
Other	32a		(27.7	)		(3.8	)
Taxes paid			(268.4	)		(132.5	)
Operating cash flow before change in non-cash working capital			764.3			691.1
Change in non-cash working capital	32b		(57.0	)		(24.9	)
			707.3			666.2
Cash used in investing activities:
Acquisition of property, plant and equipment			(466.7	)		(347.1	)
Acquisition of intangibles			(2.8	)		(1.8	)
Community agreements			(17.5	)		(9.1	)
Grants received			0.7			3.1
Net purchase of investments	11		(61.8	)		(3.2	)
Change in restricted cash			0.8			0.8
Maturity of (investment in) short-term investments	8		40.0			(40.0	)
Consideration received from sale of non-core project	6g		14.9			-
Investment income received			24.0			14.4
			(468.4	)		(382.9	)
Cash (used in) generated from financing activities:
Repayment of revolving credit facility	19b		-			(100.0	)
Repurchase of senior unsecured notes, net of discount			(102.1	)		(81.9	)
Copper Mountain non-controlling interest - acquisition payment	5		(6.0	)		-
Equity and flow-through share issuance, net of issuance costs	25b		26.8			398.0
Interest paid on long-term debt			(58.4	)		(67.9	)
Financing costs			(11.7	)		(15.1	)
Lease payments	18		(36.9	)		(31.4	)
Equipment financing payments			(20.2	)		(10.2	)
Gold prepayment repayments			-			(62.3	)
Deferred Rosemont acquisition payment			-			(10.0	)
Net payments on settlement of non-QP hedges			(3.4	)		(7.9	)
Net proceeds from exercise of stock options and warrants			3.1			4.4
Dividends paid	25b		(5.6	)		(5.5	)
			(214.4	)		10.2
Effect of movement in exchange rates on cash			2.6			(1.5	)
Net increase in cash and cash equivalents			27.1			292.0
Cash and cash equivalents, beginning of the year			541.8			249.8
Cash and cash equivalents, end of the year		$	568.9		$	541.8

4

HUDBAY MINERALS INC.
Consolidated Statements of Changes in Equity
(In millions of US dollars)

		Share capital (note 25)			Other capital reserves			Foreign currency translation reserve			Remeasurement reserve			Retained earnings			Total			Non- controlling interest			Total equity
Balance, January 1, 2024	$	2,240.2		$	61.3		$	(5.4	)	$	(25.7	)	$	(173.6	)	$	2,096.8		$	110.0		$	2,206.8
Net income (loss)		-			-			-						76.7			76.7			(8.9	)		67.8
Other comprehensive (loss) income		-			-			(43.0	)		26.9			-			(16.1	)		(6.9	)		(23.0	)
Total comprehensive (loss) income		-			-			(43.0	)		26.9			76.7			60.6			(15.8	)		44.8
Contributions by and distributions to owners:
Dividends (note 25b)		-			-			-						(5.5	)		(5.5	)		-			(5.5	)
Flow-through shares issued, net of share issuance costs (note 25b)		8.6			-			-						-			8.6			-			8.6
Shares issued on equity raise, net of share issuance costs		386.2			-			-						-			386.2			-			386.2
Stock options		-			2.1			-						-			2.1			-			2.1
Issuance of shares related to stock options and warrants exercised		6.3			(1.9	)		-						-			4.4			-			4.4
Total contributions by and distributions to owners		401.1			0.2			-			-			(5.5	)		395.8			-			395.8
Balance, December 31, 2024	$	2,641.3		$	61.5		$	(48.4	)	$	1.2		$	(102.4	)	$	2,553.2		$	94.2		$	2,647.4

5

HUDBAY MINERALS INC.
Consolidated Statements of Changes in Equity
(In millions of US dollars)

		Share capital (note 25)			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)		-			-			-			-			568.5			568.5			(4.2	)		564.3
Other comprehensive income		-			-			22.5			7.2			-			29.7			3.2			32.9
Total comprehensive income (loss)		-			-			22.5			7.2			568.5			598.2			(1.0	)		597.2
Contributions by and distributions to owners:
Dividends (note 25b)		-			-			-			-			(5.6	)		(5.6	)		-			(5.6	)
Flow-through shares issued, net of share issuance costs (note 25b)		13.7			-			-			-			-			13.7			-			13.7
Shares issued on equity raise, net of share issuance costs		4.2			-			-			-			-			4.2			-			4.2
Copper Mountain non-controlling interest acquisition (note 5)					61.3			(4.0	)		-			-			57.3			(93.2	)		(35.9	)
Stock options		-			2.5			-			-			-			2.5			-			2.5
Issuance of shares related to stock options and warrants exercised		4.6			(1.5	)		-			-			-			3.1			-			3.1
Tax adjustments in respect of prior years		4.4			-			-			-			-			4.4			-			4.4
Total contributions by and distributions to owners		26.9			62.3			(4.0	)		-			(5.6	)		79.6			(93.2	)		(13.6	)
Balance, December 31, 2025	$	2,668.2		$	123.8		$	(29.9	)	$	8.4		$	460.5		$	3,231.0		$	-		$	3,231.0

6

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

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 consolidated financial statements ("financial statements") of the Company for the year ended December 31, 2025 and 2024 represent the financial position and the financial performance of the Company and its subsidiaries (together referred to as "Hudbay").

Wholly owned subsidiaries as at December 31, 2025 included Copper Mountain Mine (BC) Ltd. ("CMBC"), HudBay Peru Inc., HudBay Peru S.A.C. ("Hudbay Peru"), HudBay (BVI) Inc., Hudbay Arizona Inc., Copper World LLC, ("Copper World") and Mason Resources (US) Inc. ("Mason").

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 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.

2. Basis of preparation

(a) Statement of compliance:

These consolidated financial statements have been prepared in accordance with IFRS^® Accounting Standards as issued by the International Accounting Standards Board ("IASB") effective for the year ended December 31, 2025.

The Board of Directors approved these consolidated financial statements on February 19, 2026.

(b) Functional and presentation currency:

Hudbay's consolidated financial statements are presented in US dollars, which is the Company's and all material subsidiaries' functional currency, except the Company's Manitoba and British Columbia business units, which have a functional currency of Canadian dollars. All values are expressed in millions except where otherwise indicated.

(c) Basis of measurement:

The consolidated financial statements have been prepared on the historical cost basis except for the following items in the consolidated balance sheets:

- Derivatives, embedded derivatives, other financial instruments, and financial assets measured at fair value through profit or loss ("FVTPL");

- Contingent and deferred consideration arising from the purchase of non-controlling interest are recognized as financial liability at fair value on the date the obligation arises;

- Liabilities for cash-settled share-based compensation arrangements are measured at fair value; and,

- A defined benefit liability is recognized as the net total of the plan assets, unrecognized past service costs and unrecognized actuarial losses, less unrecognized actuarial gains and the present value of the defined benefit obligation.

7

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

(d) Use of judgements and estimates:

The preparation of the consolidated financial statements requires Hudbay to make judgements, estimates and assumptions that affect the application of accounting policies, reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated 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 experience and other factors, including expectations of future events that the Company believes to be reasonable under the circumstances. Revisions to accounting estimates are recognized prospectively in the period in which the estimates are revised and in any future periods affected.

The following are critical and significant judgements and estimates impacting the consolidated financial statements:

- Indicators and testing of impairment (reversal of impairment) of non-financial assets (notes 3h, 3i, 13 and 14) - There are a number of potential indicators that could trigger non-financial asset impairment or reversal of impairment. These indicators may require critical judgements to determine the extent that external and/or internal environmental business changes may impact Hudbay's overall assessment of the recoverability of non-financial assets. Such business changes include changes to the life of mine ("LOM") plan, changes to budget, changes to closure plans, changes to discount rates, changes to long-term commodity prices and changes that relate to purchase offers resulting in a third party valuation of the CGU. If an impairment or impairment reversal indicator is identified then there are also critical estimates involved in the determination of the recoverable amount of cash generating units ("CGU"). A CGU to which goodwill has been allocated is tested for impairment at least annually or when events or circumstances indicate that an assessment for impairment is required. Recoverable amounts are calculated using discounted after-tax cash flows based on cash flow projections and assumptions in Hudbay's most recent LOM plans. LOM plans are based on optimized mine and processing plans and the assessment of capital expenditure requirements of a mine site. LOM plans incorporate management's best estimates of key assumptions which include future commodity prices, the value of mineral resources not included in the applicable LOM plans, production based on current estimates of recoverable reserves, discount rates, future operating and capital costs and future foreign exchange rates. Most critical to the value of the recoverable amount are the assumptions of future commodity prices and the value of mineral resources not included in the applicable LOM plans. Expected future cash flows used to determine the recoverable amount during impairment testing are inherently uncertain and could materially change over time. Should management's estimate of the future not reflect actual events, impairments may be identified, which could have a material effect on the financial statements. Although it is reasonably possible for a change in key assumptions to occur, the possible effects of a change in any single assumption may not fairly reflect the impact of CGU's fair value as the assumptions are inextricably linked.

- Mineral reserves and resources (notes 3g, 3k and 3i) - Hudbay estimates mineral reserves and resources to determine future recoverable mine production based on assessment of geological, engineering and metallurgical analyses, estimates of future production costs, capital costs and reclamation costs, as well as long term commodity prices and foreign exchange rates. There are numerous uncertainties inherent in estimating mineral reserves and resources, including many factors beyond Hudbay's control. The estimates are based on information compiled by appropriately qualified persons relating to the geological data on the size, depth and shape of the ore body and interpreting this data requires complex geological judgements. Changes in assumptions, including economic assumptions such as metals prices and market conditions, could have a material effect on the financial position and results of operations.

Changes in the mineral reserve or resource estimates may affect:

- the carrying value of exploration and evaluation assets, capital works in progress, mining properties and plant and equipment, goodwill;

- depreciation expense for assets depreciated either on a unit-of-production basis or on a straight line basis where useful lives are restricted by the life of the related mine plan;

- the provision for decommissioning, restoration and similar liabilities;

- the carrying value of deferred tax assets, and

- amortization of deferred revenue.

8

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

- Property plant and equipment (notes 3h and 14) - The carrying amounts of property, plant and equipment and exploration and evaluation assets on Hudbay's consolidated balance sheets are significant and reflect multiple estimates and applications of judgement. Management exercises judgement in determining whether the costs related to exploration and evaluation are eligible for capitalization and whether they are likely to be recoverable by future exploration, which may be based on assumptions about future events and circumstances. Judgement and estimates are used when determining whether exploration and evaluation assets should be transferred to capital works in progress within property, plant and equipment. For mines in the production stage, management applies judgement to determine development costs to be capitalized based on the extent they are incurred in order to access reserves mineable over more than one year. For depreciable property, plant and equipment assets, management makes estimates to determine depreciation. For assets depreciated using the straight line method, residual value and useful lives of the assets or components are estimated. A significant estimate is required to determine the total production basis for units-of-production depreciation. The most currently available reserve and resource report is utilized in determining the basis which has material impacts on the amount of depreciation recorded through inventories and the consolidated statements of income. There are numerous uncertainties inherent in estimating mineral reserves, and assumptions that were valid at the reporting date may change when new information becomes available. The actual volume of ore extracted and any changes in these assumptions could affect prospective depreciation rates and carrying values. In determining whether stripping costs incurred during the production phase of a mining property relate to mineral reserves and mineral resources that will be mined in a future period and therefore should be capitalized, Hudbay makes estimates of the proportion of stripping activity which relates to extracting current ore and the proportion which relates to obtaining access to ore reserves which will be mined in the future.

- Tax provisions (notes 3m and 24) - Management makes estimates in determining the measurement and recognition of deferred tax assets and liabilities recorded on the consolidated balance sheets. The measurement of deferred tax assets and deferred tax liabilities is based on tax rates that are expected to apply in the period that the asset is realized or liability is settled based on tax rates that have been enacted or substantively enacted by the end of the reporting period. Deferred tax assets, including those arising from unutilized tax losses, require management to assess the likelihood of taxable income in the future periods in order to utilize recognized deferred tax assets. Estimates of future taxable income are based on forecasted cash flows from operations and the application of existing tax laws in each jurisdiction. To the extent that future cash flows and taxable income differ significantly from estimates, the ability to realize the net deferred tax assets recorded at the balance sheet date could be affected. At the end of each reporting period, management reassesses the period that the assets are expected to be realized or liabilities are settled and the likelihood of taxable income in future periods in order to support and adjust the deferred tax assets and deferred tax liabilities recognized on the consolidated balance sheets.

- Assaying utilized to determine revenue and recoverability of inventories (notes 3c and 3f) - Assaying of contained metal is a key estimate in determining the amount of revenues recorded in the consolidated statements of income. The estimate is finalized after final surveying is completed, which may extend to six months in certain transactions. Since assays are utilized to determine the value of recorded revenues, significant differences in given assays may result in a material misstatement of revenues on the consolidated statements of income. Assay survey results are also a factor utilized to determine if inventories on hand have a net realizable value that exceeds cost. Material differences in assay results may lead to misstatements of inventory balances in the consolidated balance sheets.

- Decommissioning and restoration obligations (notes 3k and 21) - Significant judgement and estimates are utilized in the determination of the decommissioning and restoration provisions in the consolidated balance sheets. Judgement is involved in determining the timing and extent of cash outflows required to satisfy constructive obligations based on the timing of site closures in the LOM plans, expected unit costs to determine cash obligations to remediate disturbances and regulatory and constructive requirements, as well as technological changes to determine the extent and timing of the remediation required. The timing of cash outflows and discount rates associated with discounting the provision are also key estimates. Changes in these estimates may result in a change in classification of the provision between non-current and current as well as material differences in the total provision recorded in the consolidated balance sheets.

9

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

- Pension and other employee benefit (notes 3j, 22 and 23) - Hudbay's post retirement obligations relate mainly to ongoing health care benefits plans. Hudbay estimates obligations related to the pension and other employee benefits plans using actuarial determinations that incorporate assumptions using management's best estimates of factors including plan performance, salary escalation, retirement dates of employees and drug cost escalation rates. Due to the complexity of the valuation, the underlying assumptions and its long term nature, the defined benefit obligation is highly sensitive to changes in these assumptions. Management reviews all assumptions at each reporting date. In determining the appropriate discount rate, Hudbay considers the interest rates on corporate bonds in the respective currency with at least an AA rating, with extrapolated maturities corresponding to the expected duration of the defined benefit obligation. The mortality rate is based on publicly available mortality tables for the specific country, and Hudbay bases future salary increases and pension increases on expected future inflation rates for the respective country.

3. Material accounting policies

The accounting policies set out below have been applied consistently to all periods presented in these consolidated financial statements and by all Hudbay's entities.

(a) Basis of consolidation:

Intercompany balances and transactions are eliminated upon consolidation. When a Hudbay entity transacts with an associate or jointly controlled entity of the Company, unrealized profits and losses are eliminated to the extent of Hudbay's interest in the relevant associate or joint venture. The accounting policies of Hudbay's entities are changed when necessary to align them with the policies adopted by the Company.

Subsidiaries

A subsidiary is an entity controlled by Hudbay. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases.

Non-controlling interest

Non-controlling interest in subsidiaries are identified separately from the Company's equity in the subsidiaries. The interest of non-controlling shareholders may be initially measured either at fair value or at the non-controlling interest proportionate share of the fair value of the acquiree's identifiable net assets. The choice of measurement basis is made on an acquisition-by-acquisition basis. Subsequent to acquisition, the carrying amount of non-controlling interest is the amount of that interest at initial recognition plus the non-controlling interest share of subsequent changes in equity. Total comprehensive income is attributed to non-controlling interest even if this results in the non-controlling interest having a deficit balance.

Business combinations and goodwill

Should Hudbay make an acquisition, it first determines whether the assets acquired and liabilities assumed constitute a business, in which case the acquisition requires accounting as a business combination. Management applies judgement in determining whether the acquiree is capable of being conducted and managed for the purpose of providing a return, considering the inputs of the acquiree and processes applied to those inputs that have the ability to create outputs.

Hudbay applies the acquisition method of accounting to business combinations, whereby the goodwill is measured at the acquisition date as the fair value of the consideration transferred including the recognized amount of any non-controlling interest in the acquiree. When the excess is negative, a bargain purchase gain is recognized immediately in the consolidated statements of income. The assessment of fair values on acquisition includes those mineral reserves and resources that are able to be reliably measured. In determining these fair values, management must also apply judgement in areas including future cash flows, metal prices, exchange rates and appropriate discount rates. Changes in such estimates and assumptions could result in significant differences in the amount of goodwill recognized.

The consideration transferred is the aggregate of the fair values, at the date of the acquisition, of the sum of the assets transferred, the liabilities incurred or assumed, and the equity instruments issued by the acquirer in exchange for control of the acquiree. Acquisition-related costs are recognized in the consolidated statements of income as incurred, unless they relate to issuance of debt or equity securities.

10

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

Where applicable, the consideration transferred includes any asset or liability resulting from a contingent consideration arrangement and measured at its acquisition date fair value. Subsequent changes in such fair values are adjusted against the cost of acquisition where they qualify as measurement period adjustments. All other subsequent changes in the fair value of contingent consideration classified as an asset or liability are accounted for in accordance with relevant IFRS Accounting Standards. Changes in the fair value of contingent consideration classified as equity are not recognized.

Where a business combination is achieved in stages, the Company's previously held interest in the acquired entity are remeasured to fair value at the acquisition date, which is the date Hudbay attains control, and any resulting gain or loss is recognized in the consolidated statements of income. Amounts previously recognized in other comprehensive income ("OCI") related to interest in the acquiree prior to the acquisition date are reclassified to the consolidated statements of income, where such treatment would be appropriate if that interest were disposed of.

After initial recognition, goodwill is measured at cost less any accumulated impairment losses. For the purpose of impairment testing, goodwill acquired in a business combination is, from the acquisition date, allocated to each of Hudbay's CGUs that are expected to benefit from the synergies of the combination, irrespective of whether other assets or liabilities of the acquiree are assigned to those units. Goodwill is allocated to the lowest level at which it is monitored for internal management purposes and is not larger than an operating segment before aggregation. Where goodwill forms part of a CGU and part of the operation within that unit is disposed of, the goodwill associated with the disposed operation is included in the determination of any gain or loss on disposal.

Goodwill is not amortized and is tested for impairment annually and whenever there is an indication of impairment. If any such indication exists, the recoverable amount of the CGU is estimated in order to determine the extent of the impairment, if any. The recoverable amount is determined as the higher of fair value less direct costs to sell and the CGU's value in use. When the recoverable amount of the CGU is less than the carrying amount of that CGU, the impairment loss is allocated to reduce the carrying amount of any goodwill allocated to that CGU first, and then to the other assets of that CGU on a pro-rata basis of the carrying amount of each asset in the CGU. An impairment loss in respect of goodwill is not reversed.

Fair value for mineral interest and related goodwill is generally determined as the present value of the estimated future cash flows expected to arise from the continued use of the asset, including any expansion prospects, and its eventual disposal, using assumptions that an independent market participant may take into account.

Value in use is determined as the present value of the estimated future cash flows expected to arise from the continued use of the asset in its present form and its eventual disposal. Value in use is determined by applying assumptions specific to Hudbay's continued use and cannot take into account future development.

The weighted average cost of capital of Hudbay or comparable market participants is used as a starting point for determining the discount rates, with appropriate adjustments for the risk profile of the countries in which the individual CGUs operate and the specific risks related to the development of the project.

Where the asset does not generate cash flows that are independent of other assets, Hudbay estimates the recoverable amount of the CGU to which the asset belongs. If the carrying amount of an asset or CGU exceeds its recoverable amount, the carrying amount of the asset or CGU is reduced to its recoverable amount. An impairment loss is recognized as an expense in the consolidated statements of income.

(b) Translation of foreign currencies:

Management determines the functional currency of each Hudbay entity as the currency of the primary economic environment in which the entity operates.

Foreign currency transactions

Transactions in foreign currencies are translated to the respective functional currencies of Hudbay's entities at exchange rates in effect at the transaction dates.

At the end of each reporting period, monetary assets and liabilities denominated in foreign currencies are translated to the functional currency using the closing exchange rate. Non-monetary assets and liabilities measured at fair value are translated using the exchange rates at the date when fair value was determined. Non-monetary assets and liabilities measured at historical cost in a foreign currency are translated using exchange rates that were in effect at the transaction dates. The same translations are applied when an entity prepares its financial statements from books and records maintained in a currency other than its functional currency, except revenue and expenses may be translated at monthly average exchange rates that approximate those in effect at the transaction dates.

11

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

Foreign currency gains and losses arising on period-end revaluations are recognized in the consolidated statements of income, except for a financial liability designated as a hedge of a net investment in a foreign operation, or qualifying cash flow hedges, which are recognized in OCI.

Foreign operations

For the purpose of the consolidated financial statements, assets and liabilities of Hudbay's entities that have functional currencies other than the US dollar are translated to US dollars at the reporting date using the closing exchange rate. Revenue and expenses are translated at monthly average exchange rates that approximate those in effect at the transaction dates. Differences arising from these foreign currency translations are recognized in OCI and presented within equity in the foreign currency translation reserve. When a foreign operation is disposed, the relevant exchange differences accumulated in the foreign currency translation reserve are transferred to the consolidated statements of income as part of the profit or loss on disposal. On the partial disposal of a subsidiary that includes a foreign operation, the relevant proportion of such amount is reattributed to non-controlling interest. On disposal of a partial investment in an associate or joint venture that includes a foreign operation while retaining significant influence or joint control, the relevant proportion is reclassified to profit or loss.

Net investment in a foreign operation

Foreign currency gains and losses arising on translation of a monetary item receivable from or payable to a foreign operation for which settlement is neither planned nor likely to occur in the foreseeable future are considered to form part of a net investment in the foreign operation. Such gains and losses are recognized in OCI and presented within equity in the foreign currency translation reserve.

(c) Revenue recognition:

Revenue from the sale of goods is measured at the fair value of the consideration received or receivable, net of treatment and refining charges. Revenue from the sale of by-products is included within revenue.

Revenue is recognized when control of the goods sold has been transferred to the customer. Control is deemed to have passed to the customer when significant risk and reward of the product has passed to the customer, Hudbay has a present right to payment, and physical possession of the product has been transferred to the customer. Sales of doré are recorded when a trade confirmation is duly signed and executed between Hudbay and the end purchaser. Sale of concentrate and finished zinc frequently occur under the following terms, and management has assessed these terms in order to determine timing of transfer of control and revenue recognition as generally outlined in the following table.

Incoterms used by Hudbay	Revenue recognized when goods:
Cost, Insurance and Freight (CIF)	Are loaded on board the vessel
Free on Board (FOB)	Are loaded on board the vessel
Delivered at place (DAP)	Arrive at the named place of destination
Delivered at terminal (DAT)	Arrive at the named place of destination
Free Carrier (FCA)	Arrive at the named place of delivery
Carriage and Insurance Paid (CIP)	Arrive at the named place, upon delivery of the goods by the first carrier

Sales of copper and zinc concentrate and certain other products are provisionally priced. For these contracts, sales prices are subject to final adjustment at the end of a future period after shipment, based on quoted market prices during the quotational period specified in the contract. Revenue is recognized when the above criteria are achieved, using weight and assay results and forward market prices to estimate the fair value of the total consideration receivable. Therefore, revenue is initially recorded based on an initial provisional invoice. Subsequently, at each reporting date, until the provisionally priced sale is finalized, sales receivables are marked to market, with adjustments (both gains and losses) recorded within revenue separately as "Pricing and volume adjustments" in the notes to the consolidated financial statements and in trade and other receivables on the consolidated balance sheets. As per IFRS 15 Revenue from contracts with customers, variability in price is deemed to be fair value movements on provisionally priced receivables under the scope of IFRS 9 Financial Instruments; variability in quantities is deemed to be variable consideration. The variable consideration from weights and assay changes to quantities has been assessed to be insignificant to warrant precluding revenue being recorded as a result of possible future sales reversals. An annual analysis of the accuracy of our weights and assays is completed, and if the accuracy rate falls below a certain threshold, management then evaluates whether revenue from future sales should be constrained as a result of it being highly probable that there would be a significant revenue reversal in the future.

12

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

Hudbay only includes in the transaction price an amount which is not highly likely to be subject to significant subsequent revenue reversal. Within sales contracts with customers, separate performance obligations may arise pertaining to the shipping of goods sold. If applicable, costs and the transaction price are allocated on a relative standalone selling basis to any separate performance obligations and are recognized over the period of time the goods sold are shipped, on a gross basis.

Hudbay recognizes deferred revenue in the event it receives payments from customers before a sale meets criteria for revenue recognition.

Precious metals stream contracts, which at inception of the contract are determined that they can be satisfied through the delivery of Hudbay's own production of non-financial items (i.e. gold and silver credits) rather than cash or other financial assets, are accounted for as deferred revenue. If settlement with Hudbay's own production of gold and silver is not possible, the stream transaction is recognized as a financial liability since settlement may require a cash payment. This would cause a change to the accounting treatment, resulting in the revaluation of the agreement to the fair value through the consolidated statements of income on a recurring basis.

Deferred revenue associated with precious metals stream contracts are subject to variable consideration and contain a significant financing component since funds were received in advance of the delivery of concentrate. When a significant financing component is recognized, finance expense will be higher and revenues will be higher as the larger deferred revenue balance is amortized to revenues. A market-based discount rate is utilized at the inception of each of the respective stream agreements to determine a discount rate for computing the interest charges for the significant financing component of the deferred revenue balance. As product is delivered, the deferred revenue amount including accreted interest will be drawn down. The draw down rate requires the use of proven and probable reserves and certain resources in the calculation that are beyond proven and probable reserves which management is reasonably confident will be transferable to reserves. Key estimates used in determining the significant financing component include the discount rate and the reserve and resources assumed for conversion.

(d) Cost of sales:

Cost of sales consists of those costs previously included in the measurement of inventory sold during the period, as well as certain costs not included in the measurement of inventory, such as the cost of warehousing and distribution to customers, provisional pricing adjustments related to purchased concentrates, profit sharing, royalty payments, share-based compensation expense and other indirect expenses related to producing operations.

Cost of sales also include non-cash net realizable value adjustments to inventory, one-time adjustments related to overheads incurred when not operating at normal capacity and one-time labour charges related to facilitating the production of inventories for past service pension costs, curtailment gains and severance.

(e) Cash and cash equivalents:

Cash and cash equivalents include cash, demand deposits and short-term, highly liquid investments that are readily convertible to known amounts of cash and are subject to an insignificant risk of changes in value. Cash equivalents have maturities of three months or less at the date of acquisition. Interest earned is included in finance income on the consolidated statements of income and in investing activities on the consolidated statements of cash flows.

Amounts that are restricted from being used for at least twelve months after the reporting date or are not available for general disbursement, like a debt service account are classified as non-current assets and presented in other financial assets on the consolidated balance sheets. Changes in restricted cash balances are classified as investing or financing activities on the consolidated statements of cash flows.

(f) Inventories:

Inventories consist of stockpiles, finished goods inventory (concentrates and metals), and materials and supplies. Concentrates, doré, metals and all other saleable products are valued at the lower of cost and estimated net realizable value. Net realizable value represents the estimated selling price for inventories less all estimated direct and indirect costs of completion and costs necessary to make the sale. Where the net realizable value is less than cost, the difference is charged to the consolidated statements of income as an impairment charge in cost of sales. Costs associated with stripping activities in an open pit mine are capitalized to inventory and recorded through cost of sales unless the stripping activity can be shown to improve access to further quantities of ore that will be mined in future periods, in which case, the stripping costs are capitalized to property, plant and equipment.

Cost of production of concentrate inventory is determined on a weighted average cost basis and the cost of production of finished metal inventory is determined using the first in first out basis. The cost of production includes direct costs associated with conversion of production inventory based on normal production capacity: material, labour, contractor expenses, purchased concentrates, and an attributable portion of production overheads and depreciation of all property, plant and equipment involved with the mining and production process. Hudbay measures in-process inventories based on assays of material received at metallurgical plants and estimates of recoveries in the production processes. Due to significant uncertainty associated with volume and metal content, immaterial costs are not allocated to routine operating levels of stockpiled ore. Estimates and judgements are required to assess the nature of any significant changes to levels of ore stockpiles and determining whether allocation of costs is required.

13

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

Supplies are valued at the lower of average cost and net realizable value.

(g) Exploration and evaluation expenditures:

Exploration and evaluation activity begins when Hudbay obtains legal rights to explore a specific area and involves the search for mineral reserves, the determination of technical feasibility, and the assessment of commercial viability of an identified resource. Expenditures incurred in the exploration and evaluation phase include the cost of acquiring interest in mineral rights, licenses and properties and the costs of Hudbay's exploration activities, such as researching and analyzing existing exploration data, gathering data through geological studies, exploratory drilling, trenching, sampling, and certain feasibility studies.

Hudbay expenses the cost of its exploration and evaluation activities and capitalizes the cost of acquiring interest in mineral rights, licenses and properties in business combinations, asset acquisitions or option agreements. Amounts capitalized are recognized as exploration and evaluation assets and presented in property, plant and equipment. Exploration and evaluation assets acquired as a result of an asset acquisition or option agreement are initially recognized at cost, and those acquired in a business combination are recognized at fair value on the acquisition date. They are subsequently carried at cost less accumulated impairment. No depreciation is charged during the exploration and evaluation phase. Hudbay expenses the cost of subsequent exploration and evaluation activity related to acquired exploration and evaluation assets. Cash flows associated with acquiring exploration and evaluation assets are classified as investing activities in the consolidated statements of cash flows; those associated with exploration and evaluation expenses are classified as operating activities.

Judgement is required in determining whether the respective costs are eligible for capitalization where applicable, and whether they are likely to be recoverable, which may be based on assumptions about future events and circumstances. Estimates and assumptions made may change if new information becomes available.

Hudbay monitors exploration and evaluation assets for factors that may indicate their carrying amounts are not recoverable. If such indicators are identified, the Company tests the exploration and evaluation assets or their CGUs, as applicable, for impairment. Hudbay also tests for impairment when assets reach the end of the exploration and evaluation phase.

Exploration and evaluation assets are transferred to capital works in progress within property, plant and equipment once the Company determines that probable future economic benefits will be generated as a result of the expenditures. Hudbay's determination of probable future economic benefit is based on management's evaluation of the technical feasibility and commercial viability of the geological properties of a given ore body based on information obtained through evaluation activities, including metallurgical testing, resource and reserve estimates and the economic assessment of whether the ore body can be mined economically. Tools that may be used to determine this include a preliminary feasibility study, confidence in converting resources into reserves and the probability that the property could be developed into a mine site. At that time, the property is considered to enter the development phase, and subsequent evaluation costs are capitalized.

(h) Property, plant and equipment:

Hudbay measures items of property, plant and equipment at cost less accumulated depreciation and any accumulated impairment losses.

The initial cost of an item of property, plant and equipment includes its purchase price or construction costs, including import duties and non-refundable purchase taxes, any costs directly attributable to bringing the asset into operation, and for qualifying assets, borrowing costs. The initial cost of property, plant and equipment also includes the initial estimate of the cost of dismantling and removing the item and restoring the site on which it is located, the obligation which Hudbay incurs either when the item is acquired or as a consequence of having used the item during a particular period for purposes other than to produce inventories during that period.

Capitalization of costs ceases once an asset is in the location and condition necessary for it to be capable of operating in the manner intended by management. At this time, depreciation commences. For a new mine, this occurs upon commencement of commercial production. Any revenues less cost to produce, earned prior to commencement of commercial production, are included in the consolidated statements of income.

14

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

Carrying amounts of property, plant and equipment, including right-of-use ("ROU") assets, are depreciated to their estimated residual value over the estimated useful lives of the assets or the estimated life of the related mine or plant, if shorter. Where components of an asset have different useful lives, depreciation is calculated on each separate component. Components may be physical or non-physical, including the cost of regular major inspections and overhauls required in order to continue operating an item of property, plant and equipment.

Certain items of property, plant and equipment are depreciated on a unit-of-production basis. The unit-of-production method is based on proven and probable tonnes of ore reserves. There are numerous uncertainties inherent in estimating ore reserves, and assumptions that were valid at the reporting date may change when new information becomes available. The actual volume of ore extracted and any changes in these assumptions could affect prospective depreciation rates and carrying values.

The carrying amount of an item of property, plant and equipment is derecognized on disposal or when no future economic benefits are expected from its use or disposal. Upon derecognition of an item of property, plant and equipment, the difference between its carrying value and net sales proceeds, if any, is presented as a gain or loss in other operating income or expense in the consolidated statements of income.

i. Capital works in progress:

Capital works in progress consist of items of property, plant and equipment in the course of construction or mineral properties in the course of development, including those transferred upon completion of the exploration and evaluation phase. On completion of construction or development, costs are transferred to plant and equipment and/or mining properties as appropriate. Capital works in progress are not depreciated.

ii. Mining properties:

Mining properties consist of costs transferred from capital works in progress when a mining property reaches commercial production, costs of subsequent mine and exploration development, and acquired mining properties in the production stage.

Mining properties include costs directly attributable to bringing a mineral asset into the state where it is capable of operating in the manner intended by management and includes such costs as the cost of shafts, ramps, track haulage drifts, ancillary drifts, pumps, electrical substations, refuge stations, ventilation raises, permanent manways, and ore and waste pass raises. The determination of development costs to be capitalized during the production stage of a mine operation requires the use of judgements and estimates such as estimates of tonnes of waste to be removed over the life of the mining area and economically recoverable reserves extracted as a result.

A mining property is considered to be capable of operating in a manner intended by management when it commences commercial production based on pre-established criteria. Upon commencement of commercial production, a mining property is depreciated on a unit-of-production method. Unit-of-production depreciation rates are determined based on the related proven and probable mineral reserves and associated future development costs.

Subsequent mine development costs are capitalized to the extent they are incurred in order to access reserves mineable over more than one year. Ongoing maintenance and development expenditures are expensed as incurred and included in cost of sales in profit or loss. These include ore stope access drifts, footwall and hangingwall drifts in stopes, drawpoints, drill drifts, sublevels, slots, drill raises, stope manway access raises and definition diamond drilling.

iii. Plant and equipment:

Plant and equipment consists of buildings and fixtures, surface and underground fixed and mobile equipment and assets under lease.

Plant and equipment are depreciated on either unit-of-production or straight-line basis based on factors including the production life of assets and mineable reserves. In general, mining assets are depreciated using a unit-of-production method; equipment is depreciated using the straight-line method, based on the shorter of its useful life and that of the related mine or facility; and plants are depreciated using the straight-line method, with useful lives limited by those of related mining assets.

15

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

iv. Right-of-use lease assets:

At inception of a contract, Hudbay assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. The Company assesses the following criteria in the determination of whether a contract conveys the right to control the use of an identified asset:

• The contract involves the use of an identified asset - this may be specified explicitly or implicitly, and should be physically distinct or represent substantially all of the capacity of a physically distinct asset. If the supplier has substantive substitution rights, then the asset is not identified;

• Hudbay has the right to obtain substantially all of the economic benefits from use of the asset throughout the period of use; and

• Hudbay has the right to direct the use of the asset by means of decision making rights that are most relevant to changing how and for what purpose the asset is used. In the case where decisions about the asset's purpose is predetermined, Hudbay is deemed to have the right to direct the use of the asset if either:

▪ Hudbay has the right to operate the asset; or,

▪ Hudbay designed the asset in a way that predetermines how and for what purpose it will be used.

The Company recognizes a ROU asset and lease liability at the lease commencement date. The initial measurement of the ROU asset is on a present value basis. This is based on the calculated lease liability plus any initial direct costs incurred, an estimate of removal or restoration costs, and any payments made prior to commencement of the lease less any lease incentives received.

The right of use asset is subsequently depreciated using the straight-line method from the commencement date to the earlier of the end of the useful life of the right-of-use asset or the end of the lease term. The estimated useful lives of the right-of-use assets are determined on the same basis as those of property and equipment. In addition, the right-of-use asset is periodically reduced by impairment losses, if any, and adjusted for certain remeasurements of the lease liability.

The lease liability is measured at the present value of the lease payments that are yet to be paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be easily determined, Hudbay's incremental borrowing rate. Generally, the Company uses its incremental borrowing rate as the discount rate for applicable leases.

Lease payments included in the measurement of the lease liability comprise fixed payments including in substance fixed payments and variable payments that depend on an index or rate, amounts expected to be payable under a residual value guarantee and the additional costs Hudbay reasonably expects to incur due to purchase options, extension options and termination options reasonably expected to be exercised.

The lease liability is measured at amortized cost using the effective interest method. It is remeasured when there is a change in the expected future cash flows of a leasing contract either due to a change in index or rate, or due to a change in terms of the contract. When the lease liability is remeasured in this way, a corresponding adjustment is made to the carrying amount of the right-of-use asset, or is recorded in profit or loss if the carrying amount of the right-of-use asset is zero.

Hudbay has elected not to separate non-lease components and account for the lease and non-lease components as a single lease component for lease contracts of all asset classes.

The Company has elected not to recognize ROU assets and lease liabilities for short-term leases of machinery that have a lease term of 12 months or less and leases of low-value assets. Hudbay recognizes the lease payments associated with these leases as an expense on a straight-line basis over the lease term.

Hudbay does not enter into transactions where the Company acts as a lessor.

The incremental borrowing rate used to discount leases and to compute interest for new ROU leases is considered a key management judgement.

16

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

v. Depreciation rates of major categories of assets:

• Capital works in progress	- not depreciated
• Mining properties	- unit-of-production
• Mining asset	- unit-of-production
• Plant and Equipment
◦ Equipment	- straight-line over 1 to 20 years
◦ Other plant assets	- straight-line over 1 to 20 years/unit-of-production
• ROU Assets	- straight-line over 1 to 20 years

Hudbay reviews its depreciation methods, remaining useful lives and residual values at least annually and accounts for changes in estimates prospectively.

vi. Commercial production:

Commercial production is the level of activities intended by management for a mine, or a mine and mill complex, to be capable of operating in the manner intended by management. Hudbay considers a range of factors when determining the level of activity that represents commercial production for a particular project, including a predetermined percentage of design capacity for the mine and mill; achievement of continuous production, ramp-ups, or other output; or specific factors such as recoveries, grades, or inventory build-ups. In a phased mining approach, management may consider achievement of specific milestones at each phase of completion. In a non-phased mining approach, management considers average actual metrics that are at least 60% of average design capacity or plan over a continuous period. Management assesses the operation's ability to sustain production over a period of approximately one to three months, depending on the complexity related to the stability of continuous operation. Commercial production is considered to have commenced, and depreciation expense is recognized, at the beginning of the month after criteria have been met.

vii. Capitalized borrowing costs:

The Company capitalizes borrowing costs that are directly attributable to the acquisition, construction or production of qualifying assets, which are assets that necessarily take a substantial period of time, generally one year or more, to get ready for their intended use or sale. Capitalization of borrowing costs ceases once the qualifying assets commence commercial production or are otherwise ready for their intended use or sale.

Where funds are borrowed specifically to finance a project, the amount capitalized represents the actual borrowing costs incurred. Where the funds used to finance a project form part of general borrowings, the amount capitalized is calculated using a weighted average of interest rates applicable to relevant general borrowings of Hudbay during the period, to a maximum of actual borrowing costs incurred. Investment income earned by temporarily investing specific borrowings pending their expenditure on qualifying assets is deducted from the borrowing costs eligible for capitalization. Capitalization of interest is suspended during extended periods in which active development is interrupted.

All other borrowing costs are recognized in the consolidated statements of income in the period in which they are incurred.

viii. Capitalized stripping costs:

Costs associated with stripping activities in an open pit mine are capitalized to inventory and recorded through cost of sales unless the stripping activity can be shown to improve access to further quantities of ore that will be mined in future periods, in which case, the stripping costs are capitalized to property, plant and equipment. Capitalized stripping costs are included in "mining properties" within property, plant and equipment.

Capitalized stripping costs are depreciated using a units-of-production method over the expected reserves within a given phase of mine development.

17

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

(i) Impairment of non-financial assets:

At the end of each reporting period, Hudbay reviews the carrying amounts of property, plant and equipment, exploration and evaluation assets and intangible assets - computer software to determine whether there is any indication of impairment. If any such indication exists, the Company estimates the recoverable amount of the asset in order to determine the extent of the impairment loss, if any. Hudbay generally assesses impairment at the level of CGUs, which are the smallest identifiable groups of assets that generate cash inflows that are largely independent of cash inflows from other assets.

Hudbay's CGUs consist of Manitoba, British Columbia, Peru, Arizona and greenfield exploration assets.

The Company allocates near mine exploration and evaluation assets to CGUs based on their operating segment, geographic location and management's intended use for the property. Near mine exploration and evaluation assets are allocated to CGUs separate from those containing producing or development-phase assets, except where such exploration and evaluation assets have the potential to significantly affect the future production of producing or development-phase assets.

Goodwill is tested for impairment annually and whenever there is an indication that the asset may be impaired. The Company performs goodwill impairment tests on an annual basis as at July 1 each year. This represents a change in accounting policy regarding the timing of the annual goodwill impairment test which was previously performed as at December 31. If the carrying value of the CGU or group of CGUs to which goodwill is assigned exceeds its recoverable amount, an impairment loss is recognized. Goodwill impairment losses are recorded in the consolidated statements of income and they are not subsequently reversed.

Where an indicator of impairment exists, a formal estimate of the recoverable amount of the asset or CGU is made. The recoverable amount is the higher of the fair value less costs of disposal and value in use:

- Fair value less costs of disposal is the amount obtainable from the sale of the asset or CGU in an arm's length transaction between knowledgeable, willing parties, less costs of disposal. Fair value for mineral assets is often determined as the present value of the estimated future cash flows expected to arise from the continued use of the asset, including any expansion prospects, and its eventual disposal, using assumptions that an independent market participant may take into account. These cash flows are discounted by an appropriate discount rate that reflects current market assessments of the time value of money and the risks specific to the asset to arrive at a net present value of the asset.

- Value in use is determined as the present value of the estimated future cash flows expected to arise from the continued use of the asset or CGU in its present form and its eventual disposal, discounted using a pre-tax rate that reflects current market assessments of the time value of money and risks specific to the asset for which estimates of future cash flows have not been adjusted. Value in use calculations apply assumptions specific to the Company's continued use and cannot take into account future development. These assumptions are different to those used in calculating fair value, and consequently the value in use calculation is likely to give a different result to a fair value calculation.

Hudbay estimates future cash flows based on estimated future recoverable mine production, expected sales prices (considering current and historical commodity prices, price trends and related factors), production levels and cash costs of production, all based on detailed engineering LOM plans. Future recoverable mine production is determined from reserves and resources after taking into account estimated dilution and recoveries during mining, and estimated losses during ore processing and treatment. Estimates of recoverable production from measured, indicated and inferred mineral resources not included in the LOM plan are assessed for economic recoverability and may also be included in the valuation of fair value less costs of disposal. Gains from the expected disposal of assets are not included in estimated future cash flows. Assumptions underlying future cash flow estimates are subject to risks and uncertainties. Changes in estimates may affect the expected recoverability of the Company's investments in mining properties.

If the carrying amount of an asset or CGU exceeds its recoverable amount, the carrying amount is reduced to the recoverable amount, and an impairment loss is recognized in the consolidated statements of income in the expense category consistent with the function of the impaired asset or CGU. Hudbay presents impairment losses on the consolidated statements of income as part of results from operating activities. Impairment losses recognized in respect of a CGU are allocated first to reduce the carrying amount of any goodwill allocated to the CGU and then to reduce the carrying amounts of other assets in the CGU on a pro-rata basis for depreciable assets.

18

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

The Company assesses previously recognized impairment losses each reporting date for any indications that the losses have decreased or no longer exist. Such an impairment loss is reversed, in full or in part, if there have been significant changes with a positive effect on the estimates used to determine the recoverable amount. An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined, net of depreciation or amortization, if no impairment loss had been recognized for the asset in prior years. Such reversals of impairment losses are recognized in the consolidated statements of income. An impairment loss recognized in relation to goodwill is not reversed for subsequent increases in the recoverable amount.

(j) Pension and other employee benefits:

Hudbay has non-contributory and contributory defined benefit programs for certain of its Canadian employees. The defined benefit pension benefits are based on years of service and final average salary for the salaried plans and are based on a flat dollar amount combined with years of service for the hourly plans. The Company provides non pension health and other post-employment benefits to certain active employees and pensioners (post-employment benefits) and also provides disability income, health benefits and other post-employment benefits to hourly and salaried disabled employees (other long-term employee benefits).

Hudbay accrues its obligations under the defined benefit plans as the employees render the services necessary to earn the pension and post-employment benefits. The actuarial determination of the accrued benefit obligations for pensions and post-employment benefits uses the projected benefit method pro-rated on service (which incorporates management's best estimate of future salary levels, other cost escalation, retirement ages of employees and other actuarial factors). For other long-term employee benefits, the Company recognizes the full cost of the benefit obligation at the time the employee becomes disabled. Actuarial advice is provided by external consultants.

For the funded defined benefit plans, Hudbay recognizes the deficit or excess of the fair value of plan assets over the present value of the defined benefit obligation as a liability or an asset in the consolidated balance sheets. However, the Company recognizes an excess of assets only to the extent that it represents a future economic benefit which is available in the form of refunds from the plan or reductions in future contributions to the plan. When these criteria are not met, it is not recognized but is disclosed in the notes to the consolidated financial statements. Impacts of minimum funding requirements in relation to past service are considered when determining the balance sheet position.

Defined benefit costs are categorized as follows:

- Service costs (including current service cost, past service cost, as well as gains and losses on curtailments and settlements and administration costs);

- Net interest expense or income; and,

- Remeasurement.

The first two components of defined benefit costs shown above are recognized in the consolidated statements of income. Past service cost as well as curtailment gains are recognized in the consolidated statements of income in the period of a plan amendment. Net interest is calculated by applying the discount rate at the beginning of the period to the net defined benefit liability or asset.

Purchases and sales of plan assets are recorded on settlement date.

Remeasurement, comprising actuarial gains and losses, the effect of changes to the asset ceiling (if applicable) and the return on plan assets (excluding interest), is reflected immediately in the consolidated balance sheets with a gain or loss recognized in OCI in the period in which they occur. Remeasurement recognized in OCI is reflected in the remeasurement reserve and will not be reclassified to the consolidated statements of income. For the other long-term employee benefits plan, remeasurements are recognized immediately in the consolidated statements of income.

Actuarial determinations used in estimating obligations relating to these plans incorporate assumptions using management's best estimates of factors including plan performance, salary escalation, retirement dates of employees and healthcare cost escalation rates. Due to the complexity of the valuation, the underlying assumptions and its long-term nature, a defined benefit obligation is highly sensitive to changes in these assumptions. All assumptions are reviewed at each reporting date. In determining the appropriate discount rate, management considers the interest rates on corporate bonds in the respective currency with at least an AA rating, with extrapolated maturities corresponding to the expected duration of the defined benefit obligation. The mortality rate is based on publicly available mortality tables for the specific country. Future salary increases and pension increases are based on expected future inflation rates for the respective country.

Hudbay also has defined contribution plans providing pension benefits for certain of its salaried employees and certain of its US employees utilizing 401K plans. The Company recognizes the cost of the defined contribution plans based on the contributions required to be made during each period.

19

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

Termination benefits are recognized as an expense when Hudbay is committed demonstrably, without realistic possibility of withdrawal, to a formal detailed plan to either terminate employment before the normal retirement date, or to provide termination benefits as a result of an offer made to encourage voluntary redundancy. Termination benefits for voluntary redundancies are recognized as an expense if the Company has made an offer of voluntary redundancy, it is probable that the offer will be accepted, and the number of acceptances can be estimated reliably. Benefits that are payable more than one year after the reporting period are discounted to their present value.

(k) Environmental and other provisions:

Provisions are recognized when Hudbay has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources will be required to settle the obligation, and a reliable estimate can be made. The provisions are recorded as management's best estimate of the amount required to settle an obligation.

Provisions are stated at their present value, which is determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to the liability.

Decommissioning, restoration and similar liabilities

Provisions are recorded for legal and constructive obligations associated with the future costs of rehabilitating the Company's current and previous operating and development sites. Such costs are associated with decommissioning and restoration activities such as dismantling and removing structures, rehabilitating mines and tailings, and reclamation and re-vegetation of affected areas.

The present value of estimated costs is recorded in the period in which the asset is installed or the environment is disturbed and a reasonable estimate of future costs and discount rates can be made. The provision is discounted using a risk-free rate, and estimates of future cash flows are adjusted to reflect risk.

Subsequent to the initial measurement, the obligation is adjusted to reflect the passage of time and changes in the estimated future cash flows underlying the obligation. The increase in the provision due to the passage of time is recognized as finance expense, whereas increases and decreases due to changes in the estimated future cash flows, which are not the result of current inventory production, are capitalized and depreciated over the life of the related operating asset. Actual costs incurred upon settlement of the site restoration obligation are charged against the provision to the extent the provision was established for those costs. Upon settlement of the liability, a gain or loss may be recorded. For closed sites, changes to estimated costs are recognized immediately in the consolidated statements of income within other expenses.

Hudbay assesses the reasonableness of its estimates and assumptions each year and when conditions change, the estimates are revised accordingly. Judgement is required to determine the scope and timing of future decommissioning and restoration activities, as well as best available estimates and assumptions including discount rates, expected timing of decommissioning and restoration costs, inflationary factors and market risks. Changes in cost estimates, which may arise from changes in technology and pricing of the individual components of the cost may result in offsetting changes to the asset and liability and corresponding changes to the associated depreciation and finance costs. In view of the uncertainties concerning these future obligations, the ultimate timing and cost of reclamation and mine closure may differ materially from these estimates.

If the change in estimate results in a significant increase in the decommissioning liability and therefore an addition to the carrying value of the asset, the Company considers whether this is an indication of impairment of the asset as a whole and, if so, tests for impairment in accordance with IAS 36, Impairment of non-financial assets. If, for mature mines, the revised mine assets net of decommissioning and restoration liabilities exceeds the recoverable value, that portion of the increase is charged directly to expense as an impairment loss, within the gross profit / (loss) line.

In view of the uncertainties concerning environmental remediation, the ultimate cost of decommissioning and restoration liabilities could differ materially from the estimated amounts provided. The estimate of the total liability is subject to change based on amendments to laws and regulations and as new information concerning Hudbay's operations becomes available. Future changes, if any, to the estimated total liability as a result of amended requirements, laws, regulations and operating assumptions, as well as discount rates, may be significant and would be recognized prospectively as a change in accounting estimate, when applicable. Environmental laws, regulations and technology are continually evolving in all regions in which the Company operates. Hudbay is not able to determine the impact, if any, of environmental laws, regulations and technology that may be enacted in the future on its results of operations or financial position due to the uncertainty surrounding the ultimate form that such future laws and regulations may take.

20

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

Onerous contracts

A contract is considered to be onerous when the unavoidable costs of meeting obligations under the contract exceed the economic benefits expected to be received under it. Hudbay records a provision for any onerous contracts at the lesser of costs to comply with a contract and costs to terminate it.

Restructuring provisions

A provision for restructuring is recognized when management, with appropriate authority within Hudbay, has approved a detailed and formal restructuring plan, and the restructuring has either commenced or has been announced publicly. Future operating costs are not provided for.

(l) Financial instruments:

Non-derivative financial instruments are initially recognized at fair value plus, in the case of a financial asset or financial liability not measured at fair value through profit or loss, directly attributable transaction costs. Measurement in subsequent periods depends on the financial instrument's classification. Hudbay uses trade date accounting for regular way purchases or sales of financial assets. The Company determines the classification of its financial instruments and non-financial derivatives at initial recognition.

Financial assets and liabilities are offset and the net amount presented in the consolidated balance sheets when, and only when, Hudbay has a legal right to offset the amounts and intends either to settle on a net basis or to realize the asset and settle the liability simultaneously.

The classification of financial assets is based on the results of the contractual characteristics test and the business model assessment which will result in the financial asset being classified as either: amortized cost, fair value through profit or loss ("FVTPL") or fair value through other comprehensive income ("FVTOCI").

i. Non-derivative financial instruments - classification:

Financial assets at fair value through profit or loss

Provisionally priced copper and zinc concentrate sales receivables, warrants and investments in securities of junior mining companies are classified as financial assets at fair value through profit or loss and are measured at fair value. The gains or losses related to changes in fair value are reported in the consolidated statements of income.

Amortized cost

Cash, certain receivables, other assets related to agreements with communities near the Peru operations, trade and other payables, long-term debt, deferred consideration, contingent consideration and restricted cash are classified as and measured at amortized cost and are carried at amortized cost using the effective interest rate method, less impairment losses, if any.

Non-derivative financial liabilities

Accounts payable and senior unsecured notes are initially recognized at fair value and subsequently accounted for at amortized cost, using the effective interest method. The amortization of senior unsecured notes issue costs is calculated using the effective interest rate method.

ii. Derivatives:

Derivatives are initially recognized at fair value when Hudbay becomes a party to the derivative contract and are subsequently re-measured to fair value at the end of each reporting period. The resulting gain or loss is recognized in the consolidated statements of income immediately unless the derivative is designated and effective as a hedging instrument. Derivatives with positive fair value are recognized as assets; derivatives with negative fair value are recognized as liabilities.

Derivatives contracts that are entered to economically hedge a risk exposure but are not designated as a hedging instrument for hedge accounting purposes, and are physically settled, are initially and subsequently measured at fair value. Subsequent movements in fair value are recognized within the revenue line item in the consolidated statements of income.

21

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

Hudbay enters into derivatives contracts to hedge commodity price risk exposure associated with quotational pricing terms in our sales contract as well as for non-quotational pricing ("non-QP"), which are not designated as hedging instrument for hedge accounting purposes. These non-quotational pricing derivative contracts are not physically settled and are referred to as non-QP hedges. These are initially and subsequently measured at fair value. Subsequent movements in fair value of these non-QP hedges are recognized in change in fair value of financial instruments on the consolidated statement of income.

iii. Embedded derivatives:

Hudbay considers whether a contract contains an embedded derivative when it becomes a party to the contract. Derivatives embedded in other financial liabilities or other non-financial host contracts are treated as separate derivatives when their risks and characteristics are not closely related to those of the host contracts and the host contracts are not measured at FVTPL.

iv. Fair value of financial instruments:

The fair value of a financial instrument is the amount for which an asset could be exchanged, or a liability settled, between knowledgeable, willing parties in an arm's length transaction.

Fair values of financial instruments traded in active markets are determined based on quoted market prices, where available. Bid prices are generally used for assets held or liabilities to be issued; asking prices are generally used for assets to be acquired or liabilities held.

For financial instruments not traded in an active market, fair values are determined based on appropriate valuation techniques. Such techniques may include discounted cash flow analysis, using recent arm's length market transactions, reference to the current fair value of another instrument that is substantially the same, and other valuation models.

The Company applies a hierarchy to classify valuation methods used to measure financial instruments carried at fair value. 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 (unadjusted) in active markets for identical assets or liabilities;

- Level 2: Valuation techniques use significant observable inputs, either directly (i.e. as prices) or indirectly (i.e. derived from prices), 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 (unobservable inputs).

An analysis of fair values of financial instruments is provided in note 29.

v. Impairment of financial instruments:

Hudbay recognizes loss allowances for Expected Credit Losses ("ECL") for trade receivables not measured at FVTPL.

Loss allowances for trade receivables are measured at an amount equal to lifetime ECL. ECL is a probability-weighted estimate measured at the present value of all cash shortfalls including the impact of forward-looking information.

Hudbay has established a provision based on the Company's historical credit loss experience, adjusted for forward-looking factors specific to the debtors and the economic environment.

vi. Derecognition of financial instruments:

Hudbay derecognizes financial assets when the contractual rights to the cash flows from the assets expire, or when the Company transfers the rights to receive the contractual cash flows on the financial assets in a transaction in which substantially all the risks and rewards of ownership of the financial asset are transferred. Any interest in the transferred financial assets that is created or retained by Hudbay is recognized as a separate asset or liability.

Hudbay derecognizes financial liabilities when its contractual obligations are discharged, cancelled or expire or when its terms are modified and the cash flows of the modified liability are substantially different.

22

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

(m) Taxation:

Current Tax

Current income tax assets and liabilities for the current and prior periods are measured at the amount expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws used to compute the amount are those that are enacted or substantively enacted by the balance sheet date.

Hudbay is subject to income taxes in numerous jurisdictions. Significant judgement is required in determining the worldwide provision for income taxes due to the complexity of legislation. There are many transactions and calculations for which the ultimate tax determination is uncertain during the ordinary course of business. The Company recognizes liabilities for anticipated tax issues based on estimates of whether additional taxes will be due. Where the final tax outcome of these matters is different from the amounts that were initially recorded, such differences will affect the income tax and deferred tax provisions in the period in which such determination is made.

Additionally, future changes in tax laws in the jurisdictions in which Hudbay operates could limit the ability of the Company to obtain tax deductions in future periods.

Deferred Tax

Deferred tax is recognized using the balance sheet method in respect of temporary differences at the balance sheet date between the tax basis of assets and liabilities, and their carrying amounts for financial reporting purposes.

Deferred income tax liabilities are recognized for all taxable temporary differences, except:

- where the deferred income tax liability arises from the initial recognition of goodwill, or the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and

- in respect of taxable temporary differences associated with investments in subsidiaries, associates and interest in joint ventures, where the timing of the reversal of the temporary differences can be controlled and it is probable that the temporary differences will not reverse in the foreseeable future.

Deferred income tax assets are recognized for all deductible temporary differences, carry-forward of unused tax assets and unused tax losses, to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, and the carry-forward of unused tax assets and unused tax losses can be utilized, except:

- where the deferred income tax asset relating to the deductible temporary difference arises from the initial recognition of an asset or liability in a transaction that is not a business combination and, at the time of the transaction, affects neither the accounting profit nor taxable profit or loss; and

- in respect of deductible temporary differences associated with investments in subsidiaries, associates and interest in joint ventures, deferred tax assets are recognized only to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which the temporary differences can be utilized.

To the extent that it is probable that taxable profit will be available to offset the deductible temporary differences, Hudbay recognizes the deferred tax asset regarding the temporary difference on decommissioning, restoration and similar liabilities and recognizes the corresponding deferred tax liability regarding the temporary difference on the related assets.

The carrying amount of deferred income tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profit will be available to allow all or part of the deferred income tax asset to be utilized. Unrecognized deferred income tax assets are reassessed at each balance sheet date and are recognized to the extent that it has become probable that future taxable profit will be available to allow the deferred tax asset to be recovered. 

Judgement is required in determining whether deferred tax assets are recognized on the consolidated balance sheets. Deferred tax assets, including those arising from unutilized tax losses, require management to assess the likelihood of taxable profit in future periods in order to utilize recognized deferred tax assets. Estimates of future taxable income are based on forecast cash flows from operations and the application of existing tax laws in each jurisdiction. To the extent that future cash flows and taxable income differ significantly from estimates, the ability to realize the net deferred tax assets recorded at the balance sheet date could be affected.

23

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

Deferred tax is measured on an undiscounted basis at the tax rates that are expected to apply in the periods in which the asset is realized or the liability is settled, based on tax rates and tax laws enacted or substantively enacted at the balance sheet date.

Deferred income tax assets and deferred income tax liabilities are offset if a legally enforceable right exists to offset current tax assets against current tax liabilities and the deferred income taxes relate to the same taxable entity and the same taxation authority.

Current and deferred taxes relating to items recognized outside profit or loss (whether in other comprehensive income or directly in equity) are recognized outside profit or loss and not in the consolidated statements of income. Mining taxes and royalties are treated and disclosed as current and deferred taxes if they have the characteristics of an income tax.

(n) Share capital and reserves:

Transaction costs

Transaction costs directly attributable to equity transactions are recognized as a deduction from equity.

Other capital reserve

The other capital reserve is used for equity-settled share-based compensation and includes amounts for stocks options granted and not exercised.

Foreign currency translation reserve

The foreign currency translation reserve is used to record exchange differences arising from the translation of the financial statements of foreign operations. Exchange differences arising from the translation of the financial statements of foreign operations form part of the net investment in the foreign operation. Translation gains and losses remain in the reserve until disposal of all or a portion of the foreign operation.

(o) Flow-through shares

Resource expenditure deductions for income tax purposes related to exploration activities funded by flow-through share arrangements are renounced to investors under Canadian income tax legislation. On issuance, the Corporation separates the flow-through share into i) a flow-through share premium, equal to the difference between the current market price of the Corporation's common shares and the issue price of the flow-through share and ii) share capital. Upon qualifying exploration and/or development expenditures being incurred, the sale of tax deductions is recognized as other income in the statement of income and the related liability is reduced. The Company may also be subject to a Part XII.6 tax on flow-through proceeds renounced, in accordance with the Canadian Income Tax Act flow-through regulations. When applicable, the estimated tax payable is accrued until paid.

(p) Share-based compensation:

Hudbay compensates its employees in part through the use of a Deferred Share Unit ("DSU") plan for non-employee members of the Board of Directors, a Restricted Share Unit ("RSU") plan for employees, a Performance Share Unit ("PSU") plan for employees and a stock option plan for employees. These plans are included in provisions on the consolidated balance sheets and further described in note 26. Changes in the fair value of the liabilities are recorded in the consolidated statements of income.

Cash-settled transactions, consisting of DSUs, RSUs and PSUs, are initially measured at fair value and recognized as an obligation at the grant date. The liabilities are remeasured to fair value at each reporting date up to and including the settlement date, with changes in fair value recognized in the consolidated statements of income. Hudbay values the liabilities based on the change in the Company's share price. Additional DSUs, RSUs and PSUs are credited to reflect dividends paid on Hudbay common shares over the vesting period. The current portion of the liability reflects those grants that have vested or that are expected to vest within twelve months.

DSUs vest on the grant date and are redeemable when a participant is no longer a member of the Board of Directors. Issue and redemption prices of DSUs are based on the average closing price of the Company's common shares for the five trading days prior to issuance or redemption.

24

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

RSUs and PSUs are issued under Hudbay's Long Term Equity Plan ("LTEP Plan") and vest on or before the third anniversary of the grant. RSUs and PSUs granted under the LTEP Plan may be settled in the form of the Company's common shares or, at the option of Hudbay, the cash equivalent based on the market price of the common shares as of the vesting date. Hudbay has historically settled RSUs in cash. Except in specified circumstances, RSUs and PSUs terminate when an employee ceases to be employed by the Company. Valuations of RSUs and PSUs reflect estimated forfeitures.

Equity-settled transactions with employees relate to stock options and are measured by reference to the fair value at the earlier of the grant date and the date that the employee unconditionally became entitled to the award. Fair value is determined using a Black-Scholes option pricing model, which relies on estimates of the future risk-free interest rate, future dividend payments, future share price volatility and the expected average life of the options. Hudbay believes this model adequately captures the substantive features of the option awards and is appropriate to calculate their fair values. The fair value determined at the grant date is recognized over the vesting period in accordance with vesting terms and conditions, with a corresponding increase to other capital reserves. The amount recognized as an expense is adjusted to reflect the number of awards for which the related service and non-market vesting conditions are expected to be met.

(q) Earnings per share:

The Company presents basic and diluted earnings (loss) per share ("EPS") data for its common shares. Basic EPS is calculated by dividing the profit or loss attributable to common shareholders of the Company by the weighted average number of common shares outstanding during the period. Diluted EPS is determined by adjusting the profit or loss attributable to common shareholders and the weighted average number of common shares outstanding for the effects of all dilutive potential common shares, which previously consisted of stock options granted to employees and warrants.

When calculating earnings per share for periods where the Company has a loss, Hudbay's calculation of diluted earnings per share excludes any incremental shares from the assumed conversion of stock options as they would be anti-dilutive.

(r) Leases:

Leases, under which substantially all the risks and rewards incidental to ownership of the leased item are transferred to Hudbay, are capitalized as assets at the inception of the lease at the lower of fair value or the present value of the minimum lease payments. Lease payments are apportioned between finance charges and the reduction of the liability so as to achieve a constant periodic rate of interest on the remaining balance of the liability. Finance charges are reflected in the consolidated statements of income as finance costs.

Non-ROU lease payments are recognized as an expense in the consolidated statements of income on a straight-line basis over the lease term.

(s) Segment reporting:

An operating segment is a component of the Company that engages in business activities from which it may earn revenue and incur expenses and for which discrete financial information is available. Hudbay's chief executive officer regularly reviews the operating results of each operating segment to make decisions about resources to be allocated to the segment and assess its performance. In determining operating segments, Hudbay considers location and decision-making authorities. Refer to note 34.

4. New standards

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 consolidated financial statements.

25

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

(b) 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 will apply for reporting periods beginning on or after January 1, 2026, with early application permitted. The Company has assessed the impact of these amendments to be immaterial to the 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 will apply for reporting periods beginning on or after January 1, 2026, with early application permitted. Hudbay has concluded that the impact of these amendments will not result in material changes to the consolidated financial statements.

5. Copper Mountain non-controlling interest acquisition

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

• $4.5 million on closing date of the 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 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 Transaction.

As a result of the Transaction, Hudbay increased its ownership of the Copper Mountain mine from 75% to 100%.

The company recorded $35.9 million of total consideration for the 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 17) and $1.5 million of transaction costs recorded within equity. 

As a result of the 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

There were no substantive changes to the Company's ownership in CMBC during the year ended December 31, 2024.

26

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

6. Revenue and expenses

(a) Revenue

Hudbay's revenue by significant product types:

		Year ended December 31,
		2025			2024
Copper	$	1,161.5		$	1,154.8
Gold		794.4			673.6
Zinc		43.5			71.1
Silver		53.6			51.5
Molybdenum		63.9			60.1
Other		-			1.7
Revenue from contracts		2,116.9			2,012.8
Non-cash streaming arrangement items: 1
Amortization of deferred revenue - gold		31.3			40.7
Amortization of deferred revenue - silver		33.8			33.6
Amortization of deferred revenue - variable consideration adjustments - prior periods		9.9			(3.8	)
		75.0			70.5
Pricing and volume adjustments 2		47.5			35.2
		2,239.4			2,118.5
Treatment and refining charges		(28.4	)		(97.3	)
	$	2,211.0		$	2,021.2
1 See note 20.
2 Pricing 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 20). 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 2025, 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 year ended December 31, 2025 resulted in an increase in revenue of $9.9 million (year ended December 31, 2024 - decrease in revenue of $3.8 million).

(b) Depreciation and amortization

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

		Year ended December 31,
		2025			2024
Cost of sales	$	439.7		$	426.6
Selling and administrative expenses		1.5			1.4
	$	441.2		$	428.0

27

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

(c) Share-based compensation expense

Share-based compensation expenses are reflected in the consolidated statements of income as follows:

		Cash-settled												Total share- based compensation expense
		RSUs			DSUs			PSUs			Stock options
Year ended December 31, 2025
Cost of sales	$	5.9		$	-		$	-		$	-		$	5.9
Selling and administrative		12.9			13.9			24.6			2.5			53.9
Other expenses		1.5			-			-			-			1.5
	$	20.3		$	13.9		$	24.6		$	2.5		$	61.3
Year ended December 31, 2024
Cost of sales	$	2.0		$	-		$	-		$	-		$	2.0
Selling and administrative		4.0			6.3			4.2		$	2.1			16.6
Other expenses		0.7			-			-			-			0.7
	$	6.7		$	6.3		$	4.2		$	2.1		$	19.3

During the year ended December 31, 2025, the Company granted 828,720 stock options (year ended December 31, 2024 - 902,874). For further details on stock options, see note 26b.

The increase in share-based compensation expense during the year ended December 31, 2025 compared with the same periods last year primarily relates to the change in the Company's share price, in addition to anticipated adjustments to the performance based multiplier on performance share units.

28

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

(d) Employee benefits expense

This table presents employee benefit expense recognized in the consolidated statements of income, including amounts transferred from inventory upon sale of goods:

		Year ended December 31,
		2025			2024
Current employee benefits	$	239.4		$	239.2
Profit-sharing plan expense		82.1			51.1
Share-based compensation (notes 6c, 22, 26)
Equity settled stock options		2.5			2.1
Cash-settled restricted share units		20.3			6.7
Cash-settled deferred share units		13.9			6.3
Cash-settled performance share units		24.6			4.2
Employee share purchase plan		2.1			1.8
Post-employee pension benefits
Defined benefit plans		4.7			4.4
Defined contribution plans		2.5			2.1
Past service cost (note 22, 23)		-			4.3
Other post-retirement employee benefits		6.0			7.5
Termination benefits		0.7			1.7
	$	398.8		$	331.4

Manitoba has a profit sharing plan required by the collective bargaining agreement whereby 10% of Manitoba's after tax profit (excluding provisions or recoveries for deferred income tax and deferred mining tax) for any given fiscal year will be distributed to all eligible employees in the Flin Flon/Snow Lake operations, with the exception of executive officers and key management personnel.

Peru has a profit sharing plan required by Peruvian law whereby 8% of Peru's taxable income will be distributed to all employees within Peru's operations.

The Company has an employee share purchase plan for executives and other eligible employees where participants may contribute between 1% and 10% of their pre-tax base salary to acquire Hudbay shares. The Company makes a matching contribution of 75% of the participant's contribution.

In addition, the Company recognized a past service cost provision adjustment related to pensions and post-employment plans for certain Manitoba employees of $nil during the year ended December 31, 2025 (year ended December 31, 2024 - $4.3 million).

See note 22 for a description of Hudbay's pension plans and note 23 for Hudbay's other employee benefit plans.

29

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

(e) Other operating expenses

		Year ended December 31,
		2025			2024
Regional costs	$	7.7		$	5.4
Write-down/loss on disposal of PP&E		3.5			27.4
Amortization of community costs (other assets)		7.1			8.5
Restructuring		0.1			1.2
Wildfire evacuation costs		4.4			-
Care & maintenance - Manitoba		13.2			14.6
Evaluation costs		3.5			1.2
Insurance recovery		(25.0	)		-
Reduction of obligation to renounce flow-through share expenditures, net of provisions		(5.5	)		(2.0	)
Option agreement proceeds (Marubeni)		(4.5	)		(0.4	)
Other		3.3			1.5
	$	7.8		$	57.4

During the year ended December 31, 2025, the Manitoba business unit incurred costs related to emergency and evacuation activities of $4.4 million as a result of regional wildfires in Snow Lake, Flin Flon and surrounding areas. 

During the year ended December 31, 2025, a recovery of $25.0 million was recorded to reflect the business interruption insurance proceeds related to the wildfire evacuation and temporary suspension of operations at Manitoba. As of December 31, 2025, all of the proceeds related to this gain have been received.

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 year ended December 31, 2025, care & maintenance costs were $13.2 million (year ended December 31, 2024 - $14.6 million).

The Arizona business unit held an option to acquire water rights and land, which expired during the first quarter of 2024 without being extended or exercised. The previously capitalized cost to maintain the option, net of accrued interest, of $8.1 million is presented as part of write-down of PP&E in 2024.

During the year ended December 31, 2024, the British Columbia business unit has recognized an impairment loss on a ball mill that is no longer being used in its operation. As a result, the carrying value of the asset has been written down to its recoverable amount, and $7.2 million is presented as part of write-down of PP&E. Furthermore, the British Columbia business unit recognized a loss of $7.8 million resulting from the replacement of components of mobile equipment and disposal of other mill equipment during the year ended December 31, 2024.

30

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

  (f) Impairment reversal

		As at December 31, 2025
Pre-tax impairment reversal to:
Property, plant & equipment (note 14)	$	(322.3	)
Tax impact		79.6
After-tax impairment reversal	$	(242.7	)

On August 12, 2025, the Company entered into an agreement with Mitsubishi Corporation ("Mitsubishi"), pursuant to which Mitsubishi agreed to acquire a 30% interest in Copper World, a wholly-owned subsidiary of Hudbay which owns the fully-permitted Copper World Project in Arizona. Mitsubishi will contribute $420 million of proceeds on closing as well as an additional $180 million within 18 months of closing to complete its 30% minority investment (the "Copper World Transaction") and will also fund its pro-rata 30% share of future equity capital contributions. The Copper World Transaction closed in January 2026 (note 35). Based on the Copper World Transaction, a market participant would value the Arizona CGU at $2,000.0 million.

The Copper World Transaction has been determined to be an indicator of impairment reversal for the Arizona cash generating unit ("CGU"). As a result, an assessment of the recoverable amount of the Arizona CGU was performed. The recoverable amount of the Arizona CGU exceeded the carrying amount of $784.4 million. 

Based on this market evidence and updated assumptions, the Company recognized a $322.3 million pre-tax impairment reversal in the consolidated statements of income during the year ended December 31, 2025. The reversal is limited to the amount of the previous impairment and does not increase the carrying amount above the level that would have been determined had no impairment been recognized previously.

(g) Consideration received from sale of non-core project

As part of a contingent consideration deed dated December 12, 2022, Harmony Gold (Australia) PTY Limited agreed to pay the Company a contingent amount upon the discovery of a new resource beyond certain parameters at the Eva project, which was previously sold by Copper Mountain prior to Hudbay's acquisition of Copper Mountain in June 2023. During the year ended 2025, a new discovery was made at the Eva project. As a result, the Company recognized the contingent payment received of $14.9 million as other income on the consolidated statements of income.

31

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

(h) Net finance expense

		Year ended December 31,
		2025			2024
Net interest expense on long-term debt
Net interest expense on long-term debt	$	60.7		$	69.8
Accretion on streaming arrangements (note 20)
Additions		20.5			24.0
Variable consideration adjustments - prior periods		(0.6	)		0.2
		19.9			24.2
Change in fair value of financial instruments
Gold prepayment liability		-			10.7
Unrealized loss on non-quotational pricing hedges		-			0.2
Realized loss on non-quotational pricing hedges		2.3			8.9
Investments at fair value through profit or loss (note 11)		(55.2	)		(3.2	)
		(52.9	)		16.6
Other net finance (income) expense
Net foreign exchange (gain) loss		(18.6	)		21.0
Accretion on community agreements measured at amortized cost		6.4			4.7
Accretion on environmental provisions		11.1			10.5
Accretion on Wheaton refund liability		0.6			0.6
Accretion on deferred and contingent liability (note 17)		1.4			-
Withholding taxes		-			2.2
Loss on disposal of investments		-			0.1
Interest on equipment financing and leases		9.0			6.7
Interest income		(22.3	)		(15.7	)
Other finance expense		4.1			8.0
		(8.3	)		38.1
Net finance expense	$	19.4		$	148.7

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

Commencing in the first quarter of 2024, Hudbay has entered into copper forward sales, copper costless collars and gold costless collars which are non-quotational pricing ("non-QP") contracts (note 29b). Subsequent movements in the fair value of non-QP contracts are recognized in change in fair value of financial instruments in the consolidated statements of income. As of December 31, 2025, there are no non-QP hedges outstanding.

During the third quarter of 2024, the Company completed the final delivery and settled the obligation for the gold prepayment liability.

7. Cash and cash equivalents

Cash and cash equivalents balances represent demand deposits and deposits with an original maturity date of less than three months.

32

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

8. Short-term investments

Short-term investments include guaranteed investment certificates held with Canadian financial institutions. The Company currently holds nil guaranteed investment certificates. As at December 31, 2024, the Company held two $20.0 million guaranteed investment certificates that matured in March 2025 and June 2025, respectively.

9. Trade and other receivables

		Dec. 31, 2025			Dec. 31, 2024
Trade receivables	$	343.8		$	179.1
Statutory receivables		30.2			50.0
Other receivables		3.8			6.4
	$	377.8		$	235.5

The increase in trade receivables during the year ended December 31, 2025 primarily relates to one shipment, representing approximately 40,000 tonnes of copper, which occurred late in the fiscal year and received revenue recognition but for which timing of cash receipts occur in 2026, along with additional revenue as a result of higher metal prices.

10. Inventories

		Dec. 31, 2025			Dec. 31, 2024
Current
Stockpile	$	17.9		$	26.9
Finished goods		76.0			81.6
Materials and supplies		105.3			88.9
		199.2			197.4
Non-current
Stockpile		5.3			2.2
Low grade stockpile1		5.7			5.5
Materials and supplies		10.6			8.9
		21.6			16.6
	$	220.8		$	214.0
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 $1,243.4 million for the year ended December 31, 2025 (year ended December 31, 2024 - $1,288.4 million, respectively).

As a result of the Manitoba wildfires and the social unrest in Peru, both the Manitoba and Peru operations underwent a temporary suspension of operations. Fixed overhead costs of $25.6 million were incurred at Manitoba for the year ended December 31, 2025, which were recognized directly to cost of sales. Additionally, Peru incurred $13.0 million in fixed overhead costs for the year ended December 31, 2025, which were recognized directly to cost of sales.

During the year ended December 31, 2025, Hudbay recognized an expense of nil in cost of sales primarily related to adjustments of the carrying value of copper concentrate and stockpile inventory to net realizable value (year ended December 31, 2024 - $0.2 million).

During the year ended December 31, 2025, Hudbay recognized an expense of $4.1 million in cost of sales related to the writedown of certain non-current inventory supplies (year ended December 31, 2024 - $2.7 million).

33

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

11. Other financial assets

		Dec. 31, 2025			Dec. 31, 2024
Current
Derivative assets	$	0.6		$	14.3
Collateral deposit (note 19)		-			0.6
Restricted cash		0.2			0.4
		0.8			15.3
Non-current
Investments at fair value through profit or loss		130.9			12.1
		130.9			12.1
	$	131.7		$	27.4

Investments at fair value through profit or loss primarily relate to common shares held in various mining companies. For the year ended December 31, 2025, the Company recorded additions of $62.1 million, unrealized mark-to-market gains of $55.2 million (note 6h), disposals of $0.3 million and unrealized foreign exchange gains of $1.8 million.

12. Intangibles and other assets

Intangibles and other assets of $58.6 million (December 31, 2024 - $44.3 million) includes $51.5 million of other assets (December 31, 2024 - $38.8 million) and $7.1 million of intangibles (December 31, 2024 - $5.5 million).

Other assets include $42.8 million of the carrying value of certain future community costs that relate to agreements with communities near the Peru operations which allow Hudbay to extract or explore minerals over the useful life of Peru operations. The liability remaining for these costs is recorded in agreements with communities recorded at amortized cost (note 17). Amortization of the carrying amount is recorded in the consolidated statements of income within other expenses (note 6e) or exploration expenses, depending on the nature of the agreement.

Other assets also include $8.7 million related to cash advances and equipment financing advances made on long lead equipment (December 31, 2024 - nil).

34

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

Intangibles mainly represent computer software costs. The following table summarizes changes in intangibles:

		Dec. 31, 2025			Dec. 31, 2024
Cost
Balance, beginning of year	$	22.5		$	21.2
Additions		2.1			2.5
Effects of movement in exchange rates		0.7			(1.2	)
Balance, end of year		25.3			22.5
Accumulated amortization
Balance, beginning of year		17.0			17.2
Depreciation for the year		0.7			0.8
Effects of movement in exchange rates		0.5			(1.0	)
Balance, end of year		18.2			17.0
Intangibles, net book value	$	7.1		$	5.5

35

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

13. Goodwill

The following table summarizes changes in goodwill:

Balance, January 1, 2024	$	75.3
Effects of changes in foreign exchange		(6.1	)
Balance, January 1, 2025	$	69.2
Effects of changes in foreign exchange		3.4
Balance, December 31, 2025	$	72.6

Goodwill resulted from the purchase price allocation associated with the Copper Mountain acquisition.

As of December 31, 2025, all of the Company's goodwill relates to the British Columbia CGU. Goodwill is tested for impairment annually on July 1 or when circumstances indicate that the carrying value may not be recoverable. Goodwill impairment is determined by assessing the recoverable amount of the CGU.

For the annual impairment test completed at July 1, 2025, FVLCD was used to determine the recoverable amount since it is higher than value in use. FVLCD was calculated using discounted after-tax cash flows based on cash flow projections and assumptions in Hudbay's most current LOM. The fair value measurement in its entirety is categorized as Level 3 based on the degree to which fair value inputs are observable and have a significant effect on the recorded fair value. LOM plans are based on optimized mine and processing plans and the assessment of capital expenditure requirements of a mine site for the CGU.

Management used judgement in determining estimates and assumptions with respect to discount rates, future production levels including amounts of recoverable reserves, resources and exploration potential, operating and capital costs, long-term metal prices, value of mineral resources not included in the LOM plan and future foreign exchange rates. Metal pricing assumptions were based on consensus forecast pricing, and the discount rates were based on a weighted average cost of capital, adjusted for country risk and other risks specific to the CGU. Cash flows were projected through to 2043. Changes in any of the assumptions or estimates used in determining the fair values could impact the impairment analysis.

The discount rate was based on the CGU's weighted average cost of capital, of which the two main components are the cost of equity and the after-tax cost of debt. Cost of equity was calculated based on the capital asset pricing model, incorporating the risk-free rate of return based on the Canadian Government's marketable bond yields as at the valuation date, the Company's beta coefficient adjustment to the market equity risk premium based on the volatility of the Company's return in relation to that of a comparable market portfolio, plus a country risk premium, size premium and company-specific risk factor. Cost of debt was determined by applying an appropriate market indication of the Company's borrowing capabilities and the corporate income tax rate applicable to the segment's jurisdiction. A real discount rate of 7.00% (December 31, 2024 - 7.25%) for the British Columbia CGU was used to calculate the estimated after- tax discounted future net cash flows, commensurate with its individual estimated level of risk.

Commodity prices used in the impairment assessment were determined by reference to external market participant sources. The key commodity price for this assessment is the price of copper. The cash flow calculations were based on estimates of future production levels applying forecasts for metal prices, which utilized a long-term copper price of $4.25/lb (December 31, 2024 - $4.15/lb), and capital, operating and reclamation costs based on the most current LOM plans. A value of $366.5 million was utilized to estimate the value of mineral resources not included in the LOM plan.

Expected future cash flows used to determine the FVLCD in the impairment test are inherently uncertain and could materially change over time. The Company has conducted an analysis of the sensitivity of the impairment test to changes in the key assumptions used to determine the recoverable amount for the CGUs to which goodwill is allocated. Management believes that any reasonably possible change in the key assumptions on which the recoverable amount is based would not cause the aggregate carrying amount to exceed the aggregate recoverable amount of the related CGU.

The estimated recoverable amount of the British Columbia CGU including goodwill exceeded its carrying amount as at July 1, 2025, accordingly no impairment was recorded.

36

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

14. Property, plant and equipment

Dec. 31, 2025		Exploration and evaluation assets			Capital works in progress			Mining properties			Plant and equipment			Plant and equipment - ROU assets1			Total
Balance, Jan. 1, 2025	$	103.4		$	863.9		$	2,578.3		$	3,345.3		$	255.1		$	7,146.0
Additions		5.2			285.6			23.4			68.4			17.7			400.3
Capitalized stripping and development		-			-			182.2			-			-			182.2
Decommissioning and restoration		-			0.3			(0.9	)		0.4			-			(0.2	)
Capitalized accretion and depreciation		-			2.0			-			-			(2.0	)		-
Transfers and other movements		-			(117.5	)		3.7			108.2			5.6			-
Disposals		(1.1	)		(0.6	)		-			(13.4	)		(5.0	)		(20.1	)
Impairment reversal (note 6f)		-			322.3			-			-			-			322.3
Effects of movements in exchange rates		1.4			3.8			55.9			58.3			2.1			121.5
Balance, Dec. 31, 2025		108.9			1,359.8			2,842.6			3,567.2			273.5			8,152.0
Accumulated depreciation
Balance, Jan. 1, 2025		-			-			1,274.4			1,524.6			165.6			2,964.6
Depreciation for the year		-			-			225.2			208.0			28.9			462.1
Disposals		-			-			-			(10.0	)		(4.0	)		(14.0	)
Effects of movement in exchange rates		-			-			23.4			21.1			0.9			45.4
Balance, Dec. 31, 2025		-			-			1,523.0			1,743.7			191.4			3,458.1
Net book value	$	108.9		$	1,359.8		$	1,319.6		$	1,823.5		$	82.1		$	4,693.9
1 Includes $5.3 million of capital works in progress - ROU assets (costs) that relate to the Arizona business unit

37

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

Dec. 31, 2024		Exploration and evaluation assets			Capital works in progress			Mining properties			Plant and equipment			Plant and equipment- ROU assets1			Total
Balance, Jan. 1, 2024	$	96.9		$	804.6		$	2,482.7		$	3,274.2		$	243.5		$	6,901.9
Additions		8.6			239.4			14.5			37.7			25.5			325.7
Capitalized stripping and development		-			-			160.5			-			-			160.5
Decommissioning and restoration		-			-			13.5			(18.2	)		-			(4.7	)
Capitalized accretion and depreciation		-			2.2			-			-			(1.6	)		0.6
Transfers and other movements		-			(168.4	)		(3.7	)		174.6			(2.5	)		-
Disposals		-			(11.9	)		-			(23.7	)		(6.4	)		(42.0	)
Effects of movements in exchange rates		(2.1	)		(2.0	)		(89.2	)		(99.3	)		(3.4	)		(196.0	)
Balance, Dec. 31, 2024		103.4			863.9			2,578.3			3,345.3			255.1			7,146.0
Accumulated depreciation
Balance, Jan. 1, 2024		-			-			1,093.9			1,348.9			143.1			2,585.9
Depreciation for the year		-			-			216.0			216.8			24.0			456.8
Disposals		-			-			-			(9.4	)		(1.0	)		(10.4	)
Effects of movement in exchange rates		-			-			(35.5	)		(31.7	)		(0.5	)		(67.7	)
Balance, Dec. 31, 2024		-			-			1,274.4			1,524.6			165.6			2,964.6
Net book value	$	103.4		$	863.9		$	1,303.9		$	1,820.7		$	89.5		$	4,181.4

¹ Includes $3.8 million of capital works in progress - ROU assets (costs) that relate to the Arizona business unit.

On a quarterly basis, management assesses for internal and external indicators of impairment and impairment reversal. During the third quarter of 2025, management identified Mitsubishi's agreement to acquire a 30% interest of Copper World to be an indicator of impairment reversal for Arizona CGU.

As a result, a $322.3 million full reversal of the previously recorded impairment was recorded, as the recoverable amount of the Arizona CGU exceeded the current carrying value (note 6f).

38

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

15. Trade and other payables

		Dec. 31, 2025			Dec. 31, 2024
Trade payables	$	84.8		$	66.7
Accruals and payables		231.9			173.4
Accrued interest		13.8			15.1
Statutory payables		12.3			15.0
	$	342.8		$	270.2

  Accruals and payables include operational and capital costs and employee benefit amounts owing.

16. Other liabilities

		Dec. 31, 2025			Dec. 31, 2024
Environmental and other provisions (note 21)	$	90.2		$	29.9
Pension obligations		0.9			1.0
Other employee benefits		3.6			3.5
	$	94.7		$	34.4

39

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

17. Other financial liabilities

		Dec. 31, 2025			Dec. 31, 2024
Current
Derivative liabilities	$	31.9		$	0.3
Equipment financing		26.2			16.3
Deferred Copper Mountain acquisition consideration		3.0			-
Agreements with communities recorded at amortized cost		61.8			21.7
		122.9			38.3
Non-current
Equipment financing		66.0			60.4
Agreements with communities recorded at amortized cost		44.1			46.7
Deferred Copper Mountain acquisition consideration		14.4			-
Contingent Copper Mountain acquisition consideration		13.9			-
Wheaton refund liability		7.9			7.3
Other financial liability		8.7			-
		155.0			114.4
	$	277.9		$	152.7

Equipment financing represents agreements that Hudbay has entered into to purchase mining equipment. 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. During the year ended December 31, 2025, $33.1 million (December 31, 2024 - $71.0 million) of capital additions related to the recognition of property, plant and equipment that has been financed (note 32). 

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 year ended December 31, 2025, there was a change in estimate related to amendments of life of mine agreements with respect to Pampacancha and Constancia, and Hudbay entered into three additional two-year agreements, resulting in net additions of $39.5 million.

As part of the acquisition of the remaining 25% interest in CMBC (note 5), 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 transaction. During the year ended December 31, 2025, accretion related to these liabilities was $1.4 million (note 6h).

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.

40

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

The following table summarizes changes in agreements with communities recorded at amortized cost:

Balance, January 1, 2024	$	54.9
Net additions		18.6
Disbursements		(9.1	)
Accretion (note 6h)		4.7
Effects of changes in foreign exchange		(0.7	)
Balance, December 31, 2024	$	68.4
Net additions		39.5
Disbursements		(17.5	)
Accretion (note 6h)		6.4
Effects of changes in foreign exchange		9.1
Balance, December 31, 2025	$	105.9

41

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

18. Lease liabilities

Balance, January 1, 2024	$	90.3
Additional capitalized leases		25.5
Lease payments		(31.4	)
Derecognized leases		(11.5	)
Accretion and other movements		1.9
Balance, December 31, 2024	$	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

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

		Dec. 31, 2025			Dec. 31, 2024
Current	$	26.7		$	30.5
Non-current		29.3			44.3
	$	56.0		$	74.8

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 consolidated statements of income, relating to leases for which a recognition exemption was applied.

		Year ended December 31,
		2025			2024
Short-term leases	$	19.6		$	9.7
Low value leases		0.4			0.4
Variable leases		18.6			23.0
Total	$	38.6		$	33.1

Payments made for short-term, low value and variable leases would mostly be captured as expenses in the consolidated 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.

42

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

19. Long-term debt

		Dec. 31, 2025			Dec. 31, 2024
Current:
Senior unsecured notes (a)	$	472.1		$	-
Non-current:
Senior unsecured notes (a)		538.8			1,111.1
Senior secured revolving credit facilities (b)		(2.3	)		(3.6	)
		536.5			1,107.5
Total Long-term debt	$	1,008.6		$	1,107.5

(a) Senior unsecured notes

Balance, January 1, 2024	$	1,190.6
Repurchases		(82.6	)
Write-down of unamortized transaction costs		0.6
Accretion of transaction costs and premiums		2.5
Balance, December 31, 2024	$	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

As at December 31, 2025, $1,014.9 million aggregate principal amount of senior notes were outstanding in two series: (i) a series of 4.50% senior notes due April 2026 ("2026 notes") in an aggregate principal amount of $472.5 million and (ii) a series of 6.125% senior notes due April 2029 ("2029 notes") in an aggregate principal amount of $542.4 million. To date, the Company repurchased and retired a total of $127.5 million of the 2026 notes and $57.6 million of the 2029 notes at a discount.

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. For the year ended December 31, 2025, the discount of $0.4 million (year ended December 31, 2024 - $0.7 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 $0.1 million (year ended December 31, 2024 - $0.6 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 and Mason 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.

43

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

(b) Senior secured revolving credit facilities

Balance, January 1, 20241	$	96.9
Repayments		(100.0	)
Accretion of transaction costs		2.0
Transaction costs		(2.5	)
Balance, December 31, 20241	$	(3.6	)
Accretion of transaction costs		1.3
Balance, December 31, 20251	$	(2.3	)
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 and Mason projects. During 2024, Hudbay repaid $10.0 million under its Canadian revolving credit facility and $90.0 million under the Peruvian revolving credit facility. During the fourth quarter of 2024, the two senior secured revolving credit facilities were extended by three years from October 2025 to November 2028. The newly extended $450.0 million revolving credit facility includes an accordion feature to increase the facility by an additional $150 million at Hudbay's discretion during the four-year tenor. Hudbay incurred $2.5 million of transactions costs associated with the extension which were deferred and amortized over the new term of the credit facilities.

As at December 31, 2025, there were nil draws under the Canadian and Peruvian revolving credit facilities, other than letters of credit to support reclamation and pension obligations as described below.

As at December 31, 2025, 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 $25.2 million in letters of credit issued under the Canadian revolving credit facility to support its reclamation and pension obligations. As at December 31, 2025, we were in compliance with our covenants under the revolving credit facilities.

Surety bonds

The Arizona segment had $18.4 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 $47.9 million in surety bonds issued to support future reclamation and closure obligations. The British Columbia segment had $1.0 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 $23.3 million in surety bonds issued to support future reclamation and closure obligations. No cash collateral is required to be posted under these surety bonds.

Other letters of credit

The Peru segment had $111.7 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 December 31, 2025, the Manitoba segment had $56.4 million in letters of credit issued under the LC Facility to support its reclamation and pension obligations.

44

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

20. Deferred revenue

Peru Stream Agreement

For the year ended December 31, 2025, the drawdown rates for the Peru stream agreement for gold and silver were $860 and $15.06 per ounce, respectively (year ended December 31, 2024 - $817 and $14.56 per ounce, respectively).

The following table summarizes changes in deferred revenue:

Balance, January 1, 2024	$	418.5
Amortization of deferred revenue
Liability drawdown		(74.3	)
Variable consideration adjustments - prior periods		3.8
Accretion on streaming arrangements
Current year additions		24.0
Variable consideration adjustments - prior periods		0.2
Balance, December 31, 2024	$	372.2
Amortization of deferred revenue (note 6a)
Liability drawdown		(65.1	)
Variable consideration adjustments - prior periods		(9.9	)
Accretion on streaming arrangements (note 6h)
Current year-to-date additions		20.5
Variable consideration adjustments - prior periods		(0.6	)
Balance, December 31, 2025	$	317.1

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 2025, 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 increase in revenue of $9.9 million and a decrease of finance expense of $0.6 million for the year ended December 31, 2025 (year ended December 31, 2024 - decrease in revenue of $3.8 million and an increase of finance expense of $0.2 million).

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

		Dec. 31, 2025			Dec. 31, 2024
Current	$	52.1		$	63.1
Non-current		265.0			309.1
	$	317.1		$	372.2

45

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

21. Environmental and other provisions

		Decommis- sioning, restoration and similar liabilities			Deferred share units3			Restricted share units1, 3			Performance share units3			Other2			Total
Balance, January 1, 2025	$	296.9		$	12.3		$	9.6		$	5.5		$	6.4		$	330.7
Net change in provision		26.2			0.9			11.5			16.0			9.5			64.1
Disbursements		(1.7	)		(5.4	)		(6.3	)		(3.5	)		(0.9	)		(17.8	)
Reduction of obligation to renounce flow-through share expenditures, net of provisions		-			-			-			-			(5.5	)		(5.5	)
Unwinding of discount (note 6h)		11.1			-			-			-			-			11.1
Effect of change in discount rate		(25.9	)		-			-			-			-			(25.9	)
Effect of foreign exchange		11.8			0.7			0.3			0.3			0.4			13.5
Effect of change in share price		-			13.0			11.0			8.6			-			32.6
Balance, December 31, 2025	$	318.4		$	21.5		$	26.1		$	26.9		$	9.9		$	402.8

¹ Certain amounts relating to the Arizona segment are capitalized.

² Relates primarily to flow-through share premiums, restructuring costs and other non-capital provisions.

³ Please refer to note 26a for further information.

Provisions are reflected in the consolidated balance sheets as follows:

December 31, 2025		Decommis- sioning, restoration and similar liabilities			Deferred share units			Restricted share units			Performance share units			Other			Total
Current (note 16)	$	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

		Decommis- sioning, restoration and similar liabilities			Deferred share units3			Restricted share units1,3			Performan- ce share units3			Other2			Total
Balance, January 1, 2024	$	315.4		$	8.7		$	5.0		$	2.6		$	12.5		$	344.2
Net additional provisions made		14.5			1.1			5.6			3.1			0.8			25.1
Disbursements		(2.1	)		(1.6	)		(2.2	)		(0.9	)		(4.8	)		(11.6	)
Reduction of obligation to renounce flow-through share-expenditures, net of provisions		-			-			-			-			(2.0	)		(2.0	)
Unwinding of discount (note 6h)		10.5			-			-			-			-			10.5
Effect of change in discount rate		(22.7	)		-			-			-			-			(22.7	)
Effect of foreign exchange		(18.7	)		(1.1	)		(0.5	)		(0.4	)		(0.1	)		(20.8	)
Effect of change in share price		-			5.2			1.7			1.1			-			8.0
Balance, December 31, 2024	$	296.9		$	12.3		$	9.6		$	5.5		$	6.4		$	330.7

¹ Certain amounts relating to the Arizona segment are capitalized.

² Relates primarily to restructuring costs and other non-capital provisions.

³ Please refer to note 26a for further information.

46

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

December 31, 2024		Decommis- sioning, restoration and similar liabilities			Deferred share units			Restricted share units			Performance share units			Other			Total
Current (note 16)	$	4.0		$	12.3		$	6.4		$	1.9		$	5.3		$	29.9
Non-current		292.9			-			3.2			3.6			1.1			300.8
	$	296.9		$	12.3		$	9.6		$	5.5		$	6.4		$	330.7

Decommissioning, restoration and similar liabilities are remeasured at each reporting date to reflect changes in discount rates, which can significantly affect the liabilities.

Decommissioning, restoration and similar liabilities ("DRO")

Hudbay's decommissioning, restoration and similar liabilities relate to the rehabilitation and closure of currently operating mines and metallurgical plants, development-phase properties and closed properties. The amount of the provision has been recorded based on estimates and assumptions that management believes are reasonable; however, actual decommissioning and restoration costs may differ from expectations.

DRO are remeasured at each reporting date to reflect changes in discount rates, inflation, exchange rates, and timing and extent of cash outflows which can significantly affect the liabilities. The amount of 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 year ended December 31, 2025, the Company recorded a non-cash loss of $0.2 million in the consolidated statements of income mainly related to a revaluation adjustment of Flin Flon's environmental reclamation provision (December 31, 2024 - gain of $3.5 million). 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 site will reflect any revaluation adjustments of its environmental reclamation provision against its reclamation assets. However, since the Flin Flon operations closed in June 2022, the corresponding Flin Flon assets have been fully depreciated and cannot be reduced below their residual value, resulting in the remaining impact being recorded as a non-cash gain in re-evaluation adjustment - environmental provision in the consolidated statements of income.

Hudbay's decommissioning and restoration liabilities relate mainly to its Manitoba, Peru and British Columbia operations. Management has placed the remaining Flin Flon assets on care and maintenance. The majority of closure activities will occur once all mining activities in Manitoba are completed. These provisions also reflect estimated post-closure cash flows that extend to the year 2124 for ongoing monitoring and water treatment requirements. Management anticipates most decommissioning and restoration activities for the Peru operation will occur from 2039 to 2103, which include ongoing monitoring and water treatment requirements. Management anticipates most decommissioning and restoration activities for the British Columbia operation will occur from 2041 to 2142, which include ongoing monitoring and water treatment requirements.

As at December 31, 2025, decommissioning, restoration and similar liabilities have been discounted to their present value at rates ranging from 2.41% to 4.95% per annum (December 31, 2024 - 2.87% to 4.88%), using pre-tax, risk-free interest rates that reflect the estimated maturity of each specific liability.

47

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

22. Pension obligations

Hudbay maintains non-contributory and contributory defined benefit pension plans for certain of its employees.

The Company uses a December 31 measurement date for all of its plans. For Hudbay's significant plans, the most recent actuarial valuations filed for funding purposes were performed during 2025 using the latest data available as at December 31, 2024. For these plans, the next actuarial valuation required for funding purposes will be performed during 2026 using the data as of December 31, 2025.

Movements in the present value of the defined benefit obligation in the current and previous years were as follows:

		Year ended
		Dec. 31, 2025			Dec. 31, 2024
Opening defined benefit obligation:	$	101.4		$	115.3
Current service costs		4.7			4.7
Past service cost (note 6d)		-			2.7
Interest cost		4.7			4.8
Benefits paid from plan		(7.4	)		(10.1	)
Benefits paid from employer		(0.7	)		(1.3	)
Remeasurement actuarial losses/(gains):
Arising from changes in demographic assumptions		-			(6.2	)
Arising from changes in financial assumptions		(4.3	)		1.3
Arising from experience adjustments		(0.8	)		(0.5	)
Effects of movements in exchange rates		5.3			(9.3	)
Closing defined benefit obligation	$	102.9		$	101.4

The defined benefit obligation closing balance, by member group, is as follows:

		Dec. 31, 2025			Dec. 31, 2024
Active members	$	84.8		$	88.4
Deferred members		4.0			2.8
Retired members		14.1			10.2
Closing defined benefit obligation	$	102.9		$	101.4

48

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

Movements in the fair value of the pension plan assets in the current and previous years were as follows:

		Year ended
		Dec. 31, 2025			Dec. 31, 2024
Opening fair value of plan assets:	$	94.2		$	106.0
Interest income		4.3			4.6
Contributions from the employer		0.8			1.1
Employer direct benefit payments		0.7			1.3
Contributions from plan participants		-			0.1
Benefit payment from employer		(0.7	)		(1.3	)
Administrative expenses paid from plan assets		-			(0.1	)
Benefits paid		(7.4	)		(10.1	)
Settlement payments from plan assets		-			-
Remeasurement adjustment:
Return on plan assets (excluding amounts included in net interest expense)		(2.0	)		1.0
Effects of changes in foreign exchange rates		4.6			(8.4	)
Closing fair value of plan assets	$	94.5		$	94.2

The amount included in the consolidated balance sheets arising from the entity's obligation in respect of its defined benefit plans is as follows:

		Dec. 31, 2025			Dec. 31, 2024
Present value of funded defined benefit obligation	$	87.7		$	87.1
Fair value of plan assets		(94.5	)		(94.2	)
Present value of unfunded defined benefit obligation		15.2			14.3
Net liability arising from defined benefit obligation	$	8.4		$	7.2

Reflected in the consolidated balance sheets as follows:

		Dec. 31, 2025			Dec. 31, 2024
Pension obligation - current (note 16)	$	0.9		$	1.0
Pension obligation - non-current		7.5			6.2
Total pension obligations	$	8.4		$	7.2

49

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

Pension expense is as follows:

		Dec. 31, 2025			Dec. 31, 2024
Service costs:
Current service cost	$	4.7		$	4.7
Past service cost		-			2.8
Total service cost		4.7			7.5
Net interest expense		0.4			0.2
Administration cost		-			0.1
Defined benefit pension expense	$	5.1		$	7.8
Defined contribution pension expense (note 6d)	$	2.5		$	2.1

Remeasurement on the net defined benefit liability:

		Dec. 31, 2025			Dec. 31, 2024
Return on plan assets (excluding amounts included in net interest expense)	$	2.0		$	(1.0	)
Actuarial gain arising from changes in demographic assumptions		-			(6.2	)
Actuarial (gain) loss arising from changes in financial assumptions		(4.3	)		1.3
Actuarial gain arising from experience adjustments		(0.8	)		(0.5	)
Defined benefit gain related to remeasurement	$	(3.1	)	$	(6.4	)
Total pension cost	$	4.5		$	3.5

Pension amounts recognized include those directly related to production of inventory; such amounts are recognized initially as costs of inventory and are expensed in the consolidated statements of income within cost of sales upon sale of the inventory.

The current service cost, the interest cost and administration cost for the year are included in the employee benefits expense. The remeasurement of the net defined benefit liability is included in OCI.

50

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

The defined benefit pension plans typically expose Hudbay to actuarial risks such as: investment risk, interest rate risk, longevity risk and salary risk.

Investment risk	The present value of the liabilities for the defined benefit plans is calculated using a discount rate determined by reference to high quality corporate bond yields; if the return on plan assets is below this rate, it will create a plan deficit. Hudbay's primary quantitative investment objectives are maximization of the long term real rate of return, subject to an acceptable degree of investment risk and preservation of principal. Risk tolerance is established through consideration of several factors including past performance, current market condition and the funded status of the plan.
Interest risk	A decrease in the bond interest rate will increase the pension plan liabilities; however, this will be partially offset by an increase in the return on the plan's debt investments.
Longevity risk	The present value of the defined benefit plans liabilities is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the pension plans liabilities.
Salary risk	The present value of the defined benefit plans liabilities for some of the pension plans is calculated by reference to the future salaries of plan participants. As such, an increase in the salary of the plan participants will increase the plans' liabilities.

The principal assumptions used for the purposes of the actuarial valuations were as follows:

	2025	2024
Defined benefit cost:
Discount rate - benefit obligations	4.66%	4.64%
Discount rate - service cost	4.73%	4.64%
Expected rate of salary increase1	2.75%	2.75%
Average longevity at retirement age for current pensioners (years)2 :
Males	20.6	20.5
Females	24.0	23.9
Defined benefit obligation:
Discount rate	4.92%	4.66%
Expected rate of salary increase1,3	2.75%	2.75%
Average longevity at retirement age for current pensioners (years)2 :
Males	20.7	20.6
Females	24.0	24.0
Average longevity at retirement age for current employees (future pensioners) (years)2 :
Males	22.5	22.5
Females	25.7	25.6
1 Plus merit and promotional scale based on member's age
2 Revised retirement pension plan only - CPM2014 Priv with MI-2017 projection scale with loading of 1.25 and 1.15 for males and females
3The 2024 defined benefit obligation rate of salary increase is 3.0% for 2024 and 2.75% thereafter.

Hudbay reviews the assumptions used to measure pension costs (including the discount rate) on an annual basis. Economic and market conditions at the measurement date affect these assumptions from year to year. In determining the discount rate, Hudbay uses the cash flow approach.

51

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

Significant actuarial assumptions for the determination of the defined benefit obligation are discount rate, expected salary increase and mortality. The sensitivity analysis below has been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting periods, while holding other assumptions constant:

- If the discount rate is 50 basis points higher (lower), the defined benefit obligation would decrease by $8.1 million (increase by $9.2 million).

- If the expected salary growth increases (decreases) by 1%, the defined benefit obligation would increase by $1.1 million (decrease by $1.0 million).

- If the life expectancy increases (decreases) by one year for both men and women, the defined benefit obligation would increase by $0.8 million (decrease by $0.8 million).

The sensitivity analysis presented above may not be representative of the actual change in the defined benefit obligation as it is unlikely that the change in assumptions would occur in isolation of one another as some of the assumptions may be correlated.

Furthermore, in presenting the above sensitivity analysis, the present value of the defined benefit obligation has been calculated using the projected unit credit method at the end of the reporting period, which is the same as that applied in calculating the defined benefit obligation liability recognized in the consolidated balance sheets.

The Company's main pension plans are registered federally with the Office of the Superintendent of Financial Institution and with the Canada Revenue Agency. The registered pension plans are governed in accordance with the Pension Benefits Standards Act and the Income Tax Act. The sponsor contributes the amount needed to maintain adequate funding as dictated by the prevailing regulations.

Expected employer contribution to the pension plans for the fiscal year ending December 31, 2025 is $1.6 million.

The average duration of the pension obligation at December 31, 2025 is 17.6 years (2024 - 18.7 years). This number can be broken down as follows:

- Active members: 19.0 years (2024: 19.8 years)

- Deferred members: 19.0 years (2024: 17.8 years)

- Retired members: 8.4 years (2024: 9.4 years)

Asset-Liability-Matching studies are performed periodically to analyze the investment policies in terms of risk and-return profiles.

The pension plans do not invest directly in either securities or property/real estate of the Company.

With the exception of fixed income investments and certain equity instruments, the plan assets are actively managed by investment managers, with the goal of attaining returns that potentially outperform passively managed investments. Within appropriate limits, the actual composition of the invested funds may vary from the prescribed investment mix.

52

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

The following is a summary of the fair value classification levels for investment:

December 31, 2025		Level 1			Level 2			Level 3			Total
Investments:
Money market instruments	$	1.0		$	-		$	-		$	1.0
Pooled equity funds		34.6			-			-			34.6
Pooled fixed income funds		-			58.5			-			58.5
Balanced funds		-			0.4			-			0.4
	$	35.6		$	58.9		$	-		$	94.5

December 31, 2024		Level 1			Level 2			Level 3			Total
Investments:
Money market instruments	$	1.1		$	-		$	-		$	1.1
Pooled equity funds		33.0			-			-			33.0
Pooled fixed income funds		-			59.6			-			59.6
Balanced funds		-			0.5			-			0.5
	$	34.1		$	60.1		$	-		$	94.2

53

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

23. Other employee benefits

Hudbay sponsors both other long-term employee benefit plans and non-pension post-employment benefits plans and uses a December 31 measurement date. These obligations relate mainly to commitments for post-retirement health benefits. Information about Hudbay's post-employment and other long-term employee benefits is as follows:

Movements in the present value of the defined benefit obligation in the current and previous years were:

		Year ended
		Dec. 31, 2025			Dec. 31, 2024
Opening defined benefit obligation	$	81.5		$	103.2
Current service cost1		1.8			2.8
Past service cost		-			1.6
Interest cost		3.8			4.5
Benefits paid		(2.8	)		(2.9	)
Remeasurement actuarial (gain)/loss:
Arising from changes in demographic assumptions		-			(12.8	)
Arising from changes in financial assumptions		(4.4	)		(1.2	)
Arising from experience adjustments		(0.4	)		(5.3	)
Effects of movements in exchange rates		4.1			(8.4	)
Closing defined benefit obligation	$	83.6		$	81.5

¹ Includes remeasurement of other long term employee benefits

The defined benefit obligation closing balance, by group member, is as follows:

		Dec. 31, 2025			Dec. 31, 2024
Active members	$	26.6		$	26.7
Inactive members		57.0			54.8
Closing defined benefit obligation	$	83.6		$	81.5

Movements in the fair value of defined benefit amounts in the current and previous years were as follows:

		Dec. 31, 2025			Dec. 31, 2024
Employer contributions	$	2.8		$	2.9
Benefits paid		(2.8	)		(2.9	)
Closing fair value of assets	$	-		$	-

The non-pension employee benefit plan obligations are unfunded.

54

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

Reconciliation of assets and liabilities recognized in the consolidated balance sheets:

		Dec. 31, 2025			Dec. 31, 2024
Unfunded benefit obligation	$	83.6		$	81.5
Vacation accrual and other - non-current		2.3			2.3
Net liability	$	85.9		$	83.8

Reflected in the consolidated balance sheets as follows:

		Dec. 31, 2025			Dec. 31, 2024
Other employee benefits liability - current (note 16)	$	3.6		$	3.5
Other employee benefits liability - non-current		82.4			80.3
Net liability	$	86.0		$	83.8

Other employee future benefit expense includes the following:

		Dec. 31, 2025			Dec. 31, 2024
Current service cost 1	$	1.8		$	2.8
Past service cost		-			1.6
Net interest cost		3.8			4.5
Components recognized in consolidated statements of income	$	5.6		$	8.9
1 Includes remeasurement of other long term employee benefit and curtailment

		Dec. 31, 2025			Dec. 31, 2024
Remeasurement on the net defined benefit liability:
Actuarial gain arising from changes in demographic assumptions	$	-		$	(12.8	)
Actuarial gain arising from changes in financial assumptions		(4.4	)		(1.2	)
Actuarial gain arising from changes experience adjustments		(0.4	)		(5.3	)
Components recognized in statements of comprehensive income	$	(4.8	)	$	(19.3	)
Total other employee future benefit expense / (income)	$	0.8		$	(10.4	)

Other employee benefit amounts recognized include those directly related to production of inventory; such amounts are recognized initially as costs of inventory and are expensed in the consolidated statements of income within cost of sales upon sale of the inventory.

55

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

	Dec. 31, 2025	Dec. 31, 2024
Defined benefit cost:
Discount rate	4.74%	4.64%
Initial weighted average health care trend rate	5.67%	5.82%
Ultimate weighted average health care trend rate	4.00%	4.00%
Average longevity at retirement age for current pensioners (years)1 :
Males	20.6	20.5
Females	24.0	23.9

	Dec. 31, 2025	Dec. 31, 2024
Defined benefit obligation:
Discount rate	5.05%	4.74%
Initial weighted average health care trend rate	5.59%	5.67%
Ultimate weighted average health care trend rate	4.00%	4.00%
Average longevity at retirement age for current pensioners (years)1 :
Males	20.7	20.6
Females	24.0	24.0
Average longevity at retirement age for current employees (future pensioners) (years)1 :
Males	22.5	22.5
Females	25.7	25.6

¹ CPM2014 Priv with MI-2017 projection scale with loading of 1.25 and 1.15 for males and females.

Hudbay reviews the assumptions used to measure other employee benefit costs (including the discount rate) on an annual basis.

The other employee benefit costs typically expose Hudbay to actuarial risks such as: interest rate risk, health care cost inflation risk and longevity risk.

Interest risk	A decrease in the bond interest rate will increase the plan liabilities.
Health care cost inflation risk	The majority of the plan's benefit obligations are linked to health care cost inflation and higher inflation will lead to higher liabilities.
Longevity risk	The majority of the plans' benefit liability is calculated by reference to the best estimate of the mortality of plan participants both during and after their employment. An increase in the life expectancy of the plan participants will increase the plans' liabilities. This is particularly significant for benefits subject to health care cost inflation where increases in inflation result in higher sensitivity to changes in life expectancy.

56

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

The sensitivity analyses below have been determined based on reasonably possible changes of the respective assumptions occurring at the end of the reporting period, while holding other assumptions constant:

- If the discount rate is 50 basis points higher (lower), the defined benefit obligation would decrease by $5.7 million (increase by $6.4 million).

- If the health care cost assumption increases (decreases) by 1%, the defined benefit obligation would increase by $12.9 million (decrease by $10.4 million).

- If the life expectancy increases (decreases) by one year for both men and women, the defined benefit obligations would increase by $3.2 million (decrease by $3.2 million).

The average duration of the non-pension post-employment obligation at December 31, 2025 is 14.4 years (2024: 15.0 years).

This number can be broken down as follows:

- Active members: 22.3 years (2024: 23.0 years)

- Inactive members: 10.9 years (2024: 11.3 years)

24. Income and mining taxes

(a) Tax expense:

The tax expense is applicable as follows:

		Year ended December 31,
		2025			2024
Current:
Income taxes	$	209.1		$	119.7
Mining taxes		83.4			57.0
Adjustments in respect of prior years		(1.2	)		0.2
		291.3			176.9
Deferred:
Income tax expense (recovery) - origination, revaluation and/or reversal of temporary differences		61.3			15.3
Mining tax recovery - origination, revaluation and/or reversal of temporary difference		(3.8	)		(5.6	)
Adjustments in respect of prior years		(1.1	)		(2.8	)
		56.4			6.9
	$	347.7		$	183.8

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.

57

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

(b) Deferred tax assets and liabilities as represented on the consolidated balance sheets:

		Dec. 31, 2025			Dec. 31, 2024
Deferred income tax asset	$	66.5		$	102.6
Deferred income tax liability		(343.1	)		(305.5	)
Deferred mining tax liability		(32.2	)		(34.9	)
		(375.3	)		(340.4	)
Net deferred tax liability balance, end of year	$	(308.8	)	$	(237.8	)

(c) Changes in deferred tax assets and liabilities:

		Year ended December 31,
		2025			2024
Net deferred tax liability balance, beginning of year	$	(237.8	)	$	(255.3	)
Deferred tax expense (note 24a)		(56.4	)		(6.9	)
OCI transactions		(0.7	)		(3.2	)
Foreign currency translation on the deferred tax liability		(13.9	)		27.6
Net deferred tax liability balance, end of year	$	(308.8	)	$	(237.8	)

58

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

(d) Reconciliation to statutory tax rate:

As a result of its mining operations, the Company is subject to both income and mining taxes. Generally, most expenditures incurred are deductible in computing income tax, whereas mining tax legislation, although based on a measure of profitability from carrying on mining operations, is more restrictive in respect of the deductions permitted in computing income subject to mining tax. These restrictions include costs unrelated to mining operations as well as deductions for financing expenses, such as interest and royalties. In addition, income unrelated to carrying on mining operations is not subject to mining tax.

A reconciliation between tax expense and the product of accounting profit multiplied by the Company's statutory income tax rate for the years ended December 31, 2025 and 2024 is as follows:

		Year ended December 31,
		2025			2024
Income before tax	$	912.0		$	251.6
Statutory tax rate		26.7%			26.7%
Tax expense at statutory rate		243.5			67.2
Effect of:
Deductions related to mining taxes		(24.2	)		(16.3	)
Adjusted income taxes		219.3			50.9
Mining tax expense		76.9			50.0
		296.2			100.9
Permanent differences related to:
Capital items		(7.4	)		0.5
Other income tax permanent differences		(0.8	)		4.1
Withholding tax on dividends		9.0			1.8
Impact of remeasurement on decommissioning liability		(1.7	)		6.5
Temporary income tax differences (recognized)/not recognized		(5.4	)		8.3
Recognition of previously unrecognized deferred tax assets		(2.4	)		-
Impact related to differences in tax rates in foreign operations		71.6			36.7
Impact of changes to statutory tax rates		-			(4.4	)
Effect of flow through shares		4.3			3.9
Foreign exchange on non-monetary items		(15.4	)		26.2
Impact related to tax assessments and tax return amendments		0.4			(1.2	)
Other		(0.7	)		0.5
Tax expense	$	347.7		$	183.8

59

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

(e) Income tax effect of temporary differences - recognized:

The tax effects of temporary differences that give rise to significant portions of the deferred tax assets and deferred tax liabilities at December 31, 2025 and 2024 are as follows:

		Balance sheet
		Dec. 31, 2025			Dec. 31, 2024
Deferred income tax (liability) asset
Property, plant and equipment	$	(65.5	)	$	(54.5	)
Pension obligation		2.3			2.0
Other employee benefits		35.8			25.1
Decommissioning and restoration provision		24.4			19.3
Non-capital losses		53.7			107.3
Share issuance and debt cost		2.9			3.8
Deferred revenue		1.8			1.7
Other		11.1			(2.1	)
Deferred income tax asset		66.5			102.6
Deferred income tax liability (asset)
Property, plant and equipment		526.9			451.6
Other employee benefits		(1.7	)		(1.2	)
Decommissioning and restoration provision		(12.8	)		(11.8	)
Non-capital losses		(158.7	)		(116.7	)
Other		(10.6	)		(16.4	)
Deferred income tax liability		343.1			305.5
Net deferred income tax liability	$	(276.6	)	$	(202.9	)

The above reconciling items are disclosed at the tax rates that apply in the jurisdiction where they have arisen.

(f) Income tax temporary differences - not recognized:

The Company has not recognized a deferred tax asset on $30.0 million of non-capital losses (December 31, 2024 - $57.2 million), $130.2 million of capital losses (December 31, 2024 - $158.7 million) and $561.6 million (December 31, 2024 - $651.3 million) of other deductible temporary differences since the realization of any related tax benefit through future taxable profits is not probable. The capital losses have no expiry dates and the other deductible temporary differences do not expire under current tax legislation.

The Canadian non-capital losses were incurred between 2013 and 2025 and have a twenty-year carry forward period. The United States net operating losses incurred between 2004 and 2017 have a twenty-year carry forward period. United States net operating losses incurred between 2018 and 2025 may be carried forward indefinitely but are restricted to being applied against a maximum of 80% of taxable income.

60

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

(g) Mining tax effect of temporary differences:

The tax effects of temporary differences that give rise to significant portions of the deferred mining tax assets and liabilities at December 31, 2025 and 2024 are as follows:

Canada		Dec. 31, 2025			Dec. 31, 2024
Property, plant and equipment	$	(40.5	)	$	(40.2	)
Other		13.9			12.8
	$	(26.6	)	$	(27.4	)
Peru		Dec. 31, 2025			Dec. 31, 2024
Property, plant and equipment	$	(5.6	)	$	(7.5	)

For the year ended December 31, 2025, Hudbay had unrecognized deferred mining tax assets of approximately $8.8 million (December 31, 2024 - $9.1 million).

(h) Unrecognized taxable temporary differences associated with investments:

There are no taxable temporary differences associated with investments in subsidiaries, associates and joint ventures, for which a deferred tax liability has not been recognized.

(i) Taxes receivable/payable:

The timing of payments results in significant variances in period-to-period comparisons of the tax receivable and tax payable balances.

(j) Other disclosure:

The tax rules and regulations applicable to mining companies are highly complex and subject to interpretation. The Company may be subject in the future to a review of its historic income and other tax filings and, in connection with such reviews, disputes can arise with tax authorities over the interpretation or application of certain tax rules and regulations in respect of the Company's business. These reviews may alter the timing or amount of taxable income or deductions. The amount ultimately reassessed upon resolution of issues raised may differ from the amount accrued.

61

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

25. 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:

		Year ended Dec. 31, 2025						Year ended Dec. 31, 2024
		Common shares			Amount			Common shares			Amount
Balance, beginning of year		394,932,374		$	2,641.3			350,728,536		$	2,240.2
Equity issuance, net of issuance costs		465,394			4.2			42,366,000			386.2
Flow through shares, net of share issuance costs and implied premium		887,000			13.7			968,900			8.6
Exercise of options		478,755			4.1			482,029			3.6
Exercise of warrants		70,708			0.5			386,909			2.7
Tax adjustments in respect of prior years		-			4.4			-			-
Balance, end of the year		396,834,231		$	2,668.2			394,932,374		$	2,641.3

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 (note 5).

On May 24, 2024, the Company closed an equity financing with a syndicate of underwriters ("the Offering"). Pursuant to the Offering, the Underwriters purchased on a bought deal basis from the Company a total of 42,366,000 common shares at a price of $9.50 per Common Share for aggregate gross proceeds of $402.5 million. Transaction costs related to the Offering were $16.1 million resulting in net proceeds to the Company of $386.4 million. Associated with the Offering were $0.2 million of share issuance costs resulting in net equity raised of $386.2 million.

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. As at December 31, 2025, $1.3 million of flow-through share liability was renounced and recognized in other expenses (note 6e) on the consolidated statements of income.

During the year ended December 31, 2024, the Company completed a Canadian Development Expense ("CDE") and CEE flow-through financing. The Company issued 968,900 common shares for proceeds, net of transaction costs, of $11.8 million. The implied premium on the flow-through shares of $3.2 million was recorded as a flow-through share liability. During the year December 31, 2025, the Company renounced the flow-through share liability recognized in 2024 pursuant to incurring qualified expenditures.

62

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

Dividends

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 to shareholders of record as of March 4, 2025 and September 2, 2025.

During the year ended December 31, 2024, the Company declared two semi-annual dividends of C$0.01 per share. The Company paid $2.6 million and $2.9 million in dividends on March 22, 2024 and September 20, 2024 to shareholders of record as of March 5, 2024 and September 3, 2024.

26. Share-based compensation

(a) Cash-settled share-based compensation:

Hudbay has three cash-settled share-based compensation plans, as described below.

Deferred Share Units (DSU)

At December 31, 2025, the carrying amount and the intrinsic value of the outstanding liability related to the DSU plan was $21.5 million (December 31, 2024 - $12.3 million) (note 21). The following table outlines information related to DSUs granted, expenses recognized and payments made during the year.

		Year ended
		Dec. 31, 2025			Dec. 31, 2024
Number of units, beginning of year		1,519,500			1,571,160
Number of units granted during the year		91,613			143,527
Credits for dividends		1,896			-
Number of units released/paid		(534,133	)		(195,187	)
Number of units, end of year		1,078,876			1,519,500
Weighted average price (C$/unit)	$	13.28		$	10.05
Expenses recognized during the year1 (notes 6c, 6d)	$	13.9		$	6.3
Payments made during the year (note 21)	$	5.4		$	1.6

¹ This expense relates to the grant of DSUs, as well as mark-to-market adjustments, and is presented within selling and administrative expenses on the consolidated statements of income.

Restricted Share Units (RSU)

RSUs granted under the LTEP Plan may be settled in the form of Hudbay common shares or, at the option of the Company, the cash equivalent based on the market price of the common shares as of the vesting date. RSUs may also be granted under Hudbay's Share Unit Plan; however, the RSUs granted under the Share Unit Plan may only be settled in cash. Hudbay has historically settled all RSUs in cash. The Company has determined that the appropriate accounting treatment is to classify the RSUs as cash settled transactions.

At December 31, 2025, the carrying amount of the outstanding liability related to the RSU plan was $26.1 million (December 31, 2024 - $9.6 million) (note 21). The following table outlines information related to RSUs granted, expenses recognized and payments made in the year.             

63

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

		Year ended
		Dec. 31, 2025			Dec. 31, 2024
Number of units, beginning of year		2,223,237			1,787,728
Number of units granted during the year		691,843			984,758
Credits for dividends		2,714			4,618
Number of units forfeited during the year		(155,864	)		(158,125	)
Number of units released/paid		(889,851	)		(395,742	)
Number of units, end of year		1,872,079			2,223,237
Weighted average price - granted (C$/unit)	$	12.03		$	7.56
Expenses recognized during the year1 (note 6c, 6d)	$	20.3		$	6.7
Payments made during the year (note 21)	$	6.3		$	2.2

¹ This net expense reflects recognition of RSU expense over the service period, as well as mark-to-market adjustments, and is presented mainly within cost of sales and selling and administrative expenses. Certain amounts related to the Arizona segment are capitalized.

Performance Share Units (PSU)

PSUs granted under the LTEP Plan may be settled in the form of Hudbay common shares or, at the option of the Company, the cash equivalent based on the market price of the common shares as of the vesting date. Hudbay has historically settled similar share-based compensation units in cash. The Company has determined that the appropriate accounting treatment is to classify the PSUs as cash settled transactions. The PSUs contain a performance based multiplier element which will be computed upon vesting.

At December 31, 2025, the carrying amount of the outstanding liability related to PSU plan was $26.9 million (December 31, 2024 - $5.5 million) (note 21). The following table outlines information related to PSUs granted, expenses recognized and payments made in the year.             

		Year ended
		Dec. 31, 2025			Dec. 31, 2024
Number of units, beginning of year		1,446,197			1,172,803
Number of units granted during the year		426,775			600,572
Number of units added by performance factor		183,152			-
Credits for dividends		2,142			2,997
Number of units forfeited during the year		(72,299	)		(169,436	)
Number of units released/paid		(490,455	)		(160,739	)
Number of units, end of year		1,495,512			1,446,197
Weighted average price - granted (C$/unit)	$	12.05		$	7.35
Expense recognized during the year (note 6c)	$	24.6		$	4.2
Payments made during the year (note 21)	$	3.5		$	0.9

64

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

(b) 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.

During the year ended December 31, 2025, the Company granted 828,720 stock options (year ended December 31, 2024 - 902,874).

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

		Year ended						Year ended
		Dec. 31, 2025						Dec. 31, 2024
		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		2,484,107		$	7.42			2,182,970		$	7.23
Number of units granted during the year		828,720		$	10.81			902,874		$	7.50
Exercised		(478,755	)	$	7.69			(482,029	)	$	6.56
Forfeited		(114,892	)	$	9.01			(106,850	)	$	7.62
Expired		(8,766	)	$	8.31			(12,858	)	$	10.03
Balance, end of year		2,710,414		$	8.34			2,484,107		$	7.42

The following table presents the weighted average fair value assumptions used in the Black-Scholes valuation of these options:

For options granted during the year ended		Dec. 31, 2025			Dec. 31, 2024
Weighted average share price at grant date (CAD)	$	10.81		$	7.50
Risk-free rate		3.07%			3.49%
Expected dividend yield		0.2%			0.3%
Expected stock price volatility (based on historical volatility)		45.3%			51.4%
Expected life of option (months)		84			84
Weighted average per share fair value of stock options granted (CAD)	$	5.39		$	4.11

65

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

The following table outlines stock options outstanding and exercisable:

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			-		$	-

Dec. 31, 2024
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		361,658			2.15		$	3.76			361,658		$	3.76
$5.27 - $6.90		631,984			5.16		$	6.75			152,408		$	6.75
$6.91 - $8.71		866,543			6.15		$	7.50			-		$	-
$8.72 - $10.17		365,988			4.16		$	9.92			223,287		$	9.92
$10.18 - $10.42		257,934			3.15		$	10.42			257,934		$	10.42

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

Warrants

The following table outlines the changes in the number of Hudbay warrants outstanding:

		Year ended						Year ended
		Dec. 31, 2025						Dec. 31, 2024
		Number of shares subject to warrants			Weighted- average exercise price C$			Number of shares subject to warrants			Weighted average exercise price C$
Balance, beginning of year		70,708		$	7.38			457,617		$	7.38
Warrants granted		-		$	-			-		$	-
Exercised		(70,708	)	$	7.38			(386,909	)	$	7.38
Expired		-		$	-			-		$	-
Balance, end of year		-		$	-			70,708		$	7.38

66

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

27. Earnings per share

		Year ended December 31,
		2025			2024
Weighted average common shares outstanding
Basic		395,521,903			376,785,518
Plus net incremental shares from:
Assumed conversion: stock options		1,126,893			483,149
Assumed conversion: warrants		-			22,544
Diluted weighted average common shares outstanding		396,648,796			377,291,211

The calculation of dilutive weighted-average number of common shares excludes the impact of 2,474 shares for the year ended December 31, 2025 (year ended December 31, 2024 - 4,127). 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.

28. Capital management

The Company's definition of capital includes total equity and long-term debt. Hudbay's long-term debt balance as at December 31, 2025 was $1,008.6 million (December 31, 2024 - $1,107.5 million).

The Company's objectives when managing capital are to maintain a strong capital base in order to:

- Advance Hudbay's corporate strategies to create long-term value for its stakeholders; and,

- Sustain Hudbay's operations and growth throughout metals and materials cycles.

Hudbay monitors its capital and capital structure on an ongoing basis to ensure they are sufficient to achieve the Company's short-term and long-term strategic objectives in a capital intensive industry. Hudbay faces several risks, including volatile metals prices, inflationary pressures on costs, access to capital, and risk of delays and cost escalation associated with major capital projects. The Company continually assesses the adequacy of its capital structure to ensure its objectives are met. Hudbay monitors its cash, which was $568.9 million as at December 31, 2025 (2024 - $541.8 million), together with availability under its committed credit facilities. Hudbay invests its cash primarily in Canadian bankers' acceptances, deposits at major Canadian and Peruvian banks, or treasury bills issued by the federal or provincial governments. In addition to the requirement to maintain sufficient cash balances to fund continuing operations, Hudbay must maintain sufficient cash to fund the interest expense on the long-term debt outstanding (note 19). As part of the Company's capital management activities, Hudbay monitors interest coverage ratios and leverage ratios.

67

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

29. 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:

		Dec. 31, 2025						Dec. 31, 2024
		FV			CV			FV			CV
Financial assets at amortized cost
Cash and cash equivalents1	$	568.9		$	568.9		$	541.8		$	541.8
Short-term investments1		-			-			40.0			40.0
Collateral deposits1		-			-			0.6			0.6
Restricted cash1		0.2			0.2			0.4			0.4
Fair value through profit or loss
Trade and other receivables2,3		347.6			347.6			185.5			185.5
Non-hedge derivative assets 4		0.6			0.6			14.3			14.3
Investments at fair value through profit or loss 5		130.9			130.9			12.1			12.1
Total financial assets	$	1,048.2		$	1,048.2		$	794.7		$	794.7
Financial liabilities at amortized cost
Trade and other payables1, 2	$	330.5		$	330.5		$	255.2		$	255.2
Deferred Copper Mountain acquisition consideration6		17.5			17.4			-			-
Contingent Copper Mountain acquisition consideration6		14.1			13.9			-			-
Agreements with communities 7		107.2			105.9			70.4			68.4
Wheaton refund liability8		13.9			7.9			9.9			7.3
Senior unsecured notes 9		1,022.7			1,010.9			1,111.6			1,111.1
Senior secured revolving credit facilities10		(2.3	)		(2.3	)		(3.6	)		(3.6	)
Fair value through profit or loss
Non-hedge derivative liabilities 4		31.9			31.9			0.3			0.3
Total financial liabilities	$	1,535.5		$	1,516.1		$	1,443.8		$	1,438.7
1 Cash and cash equivalents, short-term investments, collateral deposits, 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 Excludes tax and other statutory amounts.
3 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).
4 Derivatives 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),
5 All investments are carried at their fair value, which is determined using quoted market bid prices in active markets for listed shares.
6 Fair value of the deferred and contingent Copper Mountain acquisition consideration has been determined using an applicable credit-risk adjusted discount rate (level 3).
7 These financial liabilities relate to agreements with communities near the Constancia mine in Peru (note 17). Fair values have been determined using an applicable credit-risk adjusted discounted rate and foreign exchange rates (level 3).
8 Discounted value based on a market rate at inception of the applicable Wheaton contract for carrying value (note 17) and fair value using an applicable credit-risk adjusted discount rate (level 3).
9 Fair value of the senior unsecured notes (note 19a) has been determined using an applicable credit-risk adjusted discount rate (level 3).
10 Fair value of the senior secured revolving credit facility, when drawn, is valued using an applicable credit adjusted discount rate (level 3).

68

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

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.

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
Wheaton refund liability		-			-			13.9			13.9
Senior unsecured notes		1,022.7			-			-			1,022.7
	$	1,022.7		$	31.9		$	152.7		$	1,207.3

December 31, 2024		Level 1			Level 2			Level 3			Total
Financial assets at FVTPL:
Provisionally priced receivables	$	-		$	171.3		$	-		$	171.3
Non-hedge derivatives		-			14.3			-			14.3
Investments		10.6			-			1.5			12.1
	$	10.6		$	185.6		$	1.5		$	197.7
Financial liabilities at FVTPL:
Non-hedge derivatives	$	-		$	0.3		$	-		$	0.3
Financial liabilities at amortized cost:
Agreements with communities		-			-			70.4			70.4
Wheaton refund liability		-			-			9.9			9.9
Senior unsecured notes		1,111.6			-			-			1,111.6
	$	1,111.6		$	0.3		$	80.3		$	1,192.2

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 year ended December 31, 2025 and year ended December 31, 2024, 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, 2024.

69

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

(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 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. As at December 31, 2024, Hudbay had 61.7 million pounds of net copper swaps outstanding at an effective average price of $4.19/lb and settling from January to May 2025. The aggregate fair value of the transactions at December 31, 2025 was a net liability of $26.4 million (December 31, 2024 - an asset position of $13.7 million).

Gold fixed for floating swaps

During the year ended December 31, 2025, Hudbay entered into gold fixed for floating swaps to manage the risk associated with provisional pricing terms on concentrate shipments. 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 December 31, 2025 was 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 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. As at December 31, 2024, Hudbay had 9.7 million pounds of net zinc swaps outstanding at an effective average price of $1.38/lb and settling from January to April 2025. The aggregate fair value of the transactions at December 31, 2025 was nil (December 31, 2024 - an asset position of $0.3 million).

Copper forward sales

As at December 31, 2025, Hudbay had nil pounds of copper forwards outstanding. As at December 31, 2024, Hudbay had 5.3 million pounds of copper forwards outstanding at an effective average price of $3.95/lb and settling from January to April 2025. The aggregate fair value of the transactions at December 31, 2025 was nil (December 31, 2024 - a liability position of $0.1 million).

Copper costless collars

As at December 31, 2025, Hudbay had nil pounds of copper collars outstanding. As at December 31, 2024, Hudbay had 6.6 million pounds of copper collars outstanding settling from January to April 2025 at an average floor price of $3.88/lb and an average cap price of $4.14/lb. The aggregate fair value of the position at December 31, 2025 was nil (December 31, 2024 - an asset position of $0.1 million).

(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.

70

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

As at December 31, 2025 and December 31, 2024, 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		Dec. 31, 2025			Dec. 31, 2024			Dec. 31, 2025			Dec. 31, 2024
Copper	pounds (in 000s)		65,791			85,731			5.64			3.96
Gold	troy ounces		33,222			47,075			4,340			2,638
Silver	troy ounces		85,337			238,149			70.22			29.02
Zinc	pounds (in 000s)		8,365			12,102			1.40			1.34

The aggregate fair value of provisionally priced receivables within the copper and zinc concentrate at December 31, 2025 was an asset position of $40.9 million (December 31, 2024 - a liability position of $13.9 million).

(d) Financial risk management

Hudbay's financial risk management activities are governed by Board-approved policies addressing risk identification, hedging authorization procedures and limits and reporting. The Company's policy objective, when hedging activities are undertaken, is to reduce the volatility of future profit and cash flow within the strategic and economic goals of Hudbay. From time to time, the Company employs derivative financial instruments, including forward and option contracts, to manage risk originating from exposures to commodity price risk, foreign exchange risk and interest rate risk. Significant derivative transactions are approved by the Board of Directors, and hedge accounting is applied when certain criteria have been met. Hudbay does not use derivative financial instruments for trading or speculation purposes. The following is a discussion of the Company's risk exposures.

(i) Market risk

Market risk is the risk that changes in market prices, including foreign exchange rates, commodity prices, share prices, and interest rates will cause fluctuations in the fair value or future cash flows of a financial instrument.

Foreign currency risk

Hudbay's primary exposure to foreign currency risk arises from:

- Translation of Canadian dollar denominated costs and, to a lesser extent, Peruvian soles cost into US dollars. Substantially all of the Company's revenue are denominated in US dollars, while the majority of its operating costs are denominated in either the Canadian dollar or Peruvian sol. Generally, with gross profit, appreciation of the US dollar relative to the Canadian dollar will increase Hudbay's profit.

- Translation of foreign currency denominated cash, trade and other receivables, trade and other payables, as well as other financial liabilities. Appreciation of the US dollar relative to a foreign currency will decrease the net asset value of these balances once they have been translated to US dollars, resulting in foreign currency translation losses on foreign currency denominated assets and gains on foreign currency denominated liabilities.

The Manitoba and British Columbia segment's primary financial instrument foreign currency exposure is on US denominated cash, trade and other receivables and other financial liabilities. The Peru segment's primary financial instrument foreign currency exposure is on Peruvian soles cash, trade and other payables and other financial liabilities.

The Company's economic exposure to foreign currency risk was as follows based on notional financial instrument amounts stated in US equivalent dollars:

71

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

		Dec. 31, 2025									Dec. 31, 2024
		CAD1			USD2			PEN3			CAD1			USD2			PEN3
Cash	$	8.8		$	36.6		$	10.7		$	6.4		$	13.9		$	3.8
Trade and other receivables		0.1			145.7			1.0			0.1			116.4			0.4
Restricted cash		-			-			-			0.2			-			-
Other financial assets		98.7			-			-			12.1			-			-
Trade and other payables		(8.6	)		(2.2	)		(25.0	)		(5.7	)		(1.9	)		(15.9	)
Other financial liabilities		-			(7.9	)		(105.9	)		-			(7.3	)		(68.4	)
	$	99.0		$	172.2		$	(119.2	)	$	13.1		$	121.1		$	(80.1	)
1 HMI is exposed to foreign currency risk on CAD.
2 The Manitoba and British Columbia segments are exposed to foreign currency risk on USD.
3 The Peru segment is exposed to foreign currency risk on PEN.

The following sensitivity analysis for foreign currency risk relates solely to financial instruments and non-financial derivatives that were outstanding as at the year-end date; each sensitivity calculation assumes all other variables are held constant. This analysis is based on values as at December 31, 2025 and does not reflect the overall effect that changes in market variables would have on the Company's operating results.

December 31, 2025	Change of:		Would have changed 2025 after-tax earnings by:
USD/CAD exchange rate1	+ 10%	$	1.2
USD/CAD exchange rate1	- 10%		(1.4	)
USD/PEN exchange rate2	+ 10%		7.0
USD/PEN exchange rate2	- 10%		(8.6	)
December 31, 2024	Change of:		Would have changed 2024 after-tax earnings by:
USD/CAD exchange rate1	+ 10%	$	6.0
USD/CAD exchange rate1	- 10%		(7.4	)
USD/PEN exchange rate2	+ 10%		4.4
USD/PEN exchange rate2	- 10%		(6.2	)
1 Effect on profit due to foreign currency remeasurements of balances denominated in a currency different from a Hudbay subsidiary's functional currency.
2 Effect on profit due to foreign currency remeasurement of balances denominated in Peruvian Sol.

Commodity price risk

Hudbay is exposed to market risk from prices for the commodities the Company produces and sells, such as copper, zinc, gold and silver. From time to time, Hudbay maintains price protection programs and conducts commodity price risk management through the use of derivative contracts. The following sensitivity analysis for commodity price risk relates solely to financial instruments and non-financial derivatives that were outstanding as at the year-end date; each sensitivity calculation assumes all other variables are held constant. This analysis is based on values as at December 31, 2025 and does not reflect the overall effect that changes in market variables would have on the Company's operating results.

72

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

December 31, 2025		Change of:			Would have changed 2025 after-tax earnings by:
Copper prices ($/lb)1	+	$0.30		$	1.4
Copper prices ($/lb)1	-	$0.30			(1.4	)
Gold prices ($/oz)1	+	$300			1.8
Gold prices ($/oz)1	-	$300			(1.8	)
Zinc prices ($/lb)1	+	$0.10			0.5
Zinc prices ($/lb)1	-	$0.10			(0.5	)
December 31, 2024		Change of:			Would have changed 2024 after-tax earnings by:
Copper prices ($/lb)1	+	$0.30		$	3.4
Copper prices ($/lb)1	-	$0.30			(3.5	)
Gold prices ($/oz)1	+	$300			-
Gold prices ($/oz)1	-	$300			-
Zinc prices ($/lb)1	+	$0.10			0.1
Zinc prices ($/lb)1	-	$0.10			(0.1	)
1 Effect on profit due to provisional pricing derivatives (note 29c) and derivative contracts (note 29b).

Share price risk

Hudbay is exposed to market risk from share prices of the Company's investments in publicly listed metals and mining entities. These investments are made to foster strategic relationships, in connection with joint venture agreements and for investment purposes. Management monitors the value of these investments for the purposes of determining whether to add or reduce Hudbay's positions. The following sensitivity analysis of share price risk relates solely to financial instruments that were outstanding as at the year-end date. This analysis is based on values as at December 31, 2025 and does not reflect the overall effect that changes in market variables would have on the Company's finance expenses.

December 31, 2025		Change of:			Would have changed 2025 after- tax earnings by:
Share prices	+	25%		$	32.0
Share prices	-	25%			(32.0	)
December 31, 2024		Change of:			Would have changed 2024 after-tax earnings by:
Share prices	+	25%		$	3.0
Share prices	-	25%			(3.0	)

Interest rate risk

Hudbay is exposed to the following interest rate risks:

- cash flow interest rate risk on its cash and cash equivalents; and,

- interest rate risk on its senior secured revolving credit facilities.

The only relevant risks at December 31, 2025 is interest rate risk on cash and short-term investments. The revolving credit facilities remain undrawn as at December 31, 2025. Neither the 2026 Notes nor the 2029 Notes contain embedded derivatives that require bifurcation from the host contract.

As at December 31, 2025 and 2024, the interest rate risk relates to cash on hand and short-term investments.

73

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

This analysis only quantifies the impact of the interest rate risk on cash and short-term investments based on balances held as at December 31, 2025 and 2024 and does not reflect the overall effect that changes in market variables would have on the Company's finance expenses.

December 31, 2025		Change of:			Would have changed 2025 after-tax earnings by:
Interest rates	+	2.00%		$	8.3
Interest rates	-	2.00%			(8.3	)
December 31, 2024		Change of:			Would have changed 2024 after-tax earnings by:
Interest rates	+	2.00%		$	8.5
Interest rates	-	2.00%			(8.5	)

(ii) Credit risk

Credit risk is the risk of financial loss to Hudbay if a customer or counterparty to a financial instrument fails to meet its obligations. The Company's maximum exposure to credit risk at the reporting date is represented by the carrying amount, net of any impairment losses recognized, of financial assets and non-financial derivative assets recorded on the consolidated balance sheets.

A large portion of Hudbay's cash are on deposit with major Schedule 1 Canadian banks. Deposits with Schedule 1 Canadian banks represented 92% of total cash as at December 31, 2025 (2024 - 87%). Hudbay's investment policy requires it to comply with a list of approved investments, concentration and maturity limits, as well as credit quality. Credit concentrations in the Company's short-term investments are monitored on an ongoing basis.

Transactions involving derivatives are with counterparties Hudbay believes to be creditworthy.

At December 31, 2025, 43% of Hudbay's trade receivables were secured by letters of credit (2024 - 36% were insured or payable by letters of credit). Any additional exposure to credit risk is monitored and approved on an ongoing basis. Expected credit losses on trade and other receivables at December 31, 2025 and December 31, 2024, are insignificant.

Two customers accounted for approximately 23% and 21% of total trade receivables as at December 31, 2025 (2024 - two customers accounted for approximately 39% and 28% of total trade receivables). Credit risk for these customers is assessed as low. As at December 31, 2025, none of the Company's trade receivables were aged more than 30 days past the due date (2024 - nil).

(iii) Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its obligations associated with financial liabilities. Hudbay's objective is to maintain sufficient liquid resources to meet operational and investing requirements.

The following summarizes the contractual undiscounted cash flows of the Company's non-derivative and derivative financial liabilities, including any interest payments, by remaining contractual maturity and financial assets used to manage liquidity risk. The table includes all instruments held at the reporting date for which payments had been contractually agreed at the reporting date. The undiscounted amounts shown are gross amounts, unless the liabilities will be settled net. Amounts in foreign currency are translated at the closing rate at the reporting date. When a counterparty has a choice of when an amount is paid, the liability is allocated to the earliest possible time period.

74

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

Dec. 31, 2025		Carrying amount			Contractual cash flows			Less than 1 Year			1 - 3 Years			3 -5 Years			More than 5 Years
Assets used to manage liquidity risk
Cash	$	568.9		$	568.9		$	568.9		$	-		$	-		$	-
Restricted cash		0.2			0.2			0.2			-			-			-
Trade and other receivables		347.6			347.6			347.6			-			-			-
Non-hedge derivative assets		0.6			0.6			0.6			-			-			-
	$	917.3		$	917.3		$	917.3		$	-		$	-		$	-
Non-derivative financial liabilities
Trade and other payables	$	(330.5	)	$	(330.5	)	$	(330.5	)	$	-		$	-		$	-
Deferred Copper Mountain acquisition consideration		(17.4	)	$	(21.0	)		(3.0	)		(6.0	)		(6.0	)		(6.0	)
Contingent Copper Mountain acquisition consideration		(13.9	)	$	(18.8	)		-			-			(7.5	)		(11.3	)
Agreements with communities 1		(105.9	)		(136.7	)		(67.0	)		(12.3	)		(9.2	)		(48.2	)
Senior unsecured notes		(1,010.9	)		(1,141.8	)		(516.4	)		(66.4	)		(559.0	)		-
Wheaton refund liability		(7.9	)		(79.2	)		-			-			-			(79.2	)
	$	(1,486.5	)	$	(1,728.0	)	$	(916.9	)	$	(84.7	)	$	(581.7	)	$	(144.7	)
Derivative financial liabilities
Non hedge derivative contracts	$	(31.9	)	$	(31.9	)	$	(31.9	)	$	-		$	-		$	-
	$	(31.9	)	$	(31.9	)	$	(31.9	)	$	-		$	-		$	-
1 Represents the Peru community agreement obligation, excluding interest.

Dec. 31, 2024		Carrying amount			Contractual cash flows			Less than 1 Year			1 - 3 Years			3 -5 Years			More than 5 Years
Assets used to manage liquidity risk
Cash	$	541.8		$	541.8		$	541.8		$	-		$	-		$	-
Short-term investments		40.0			40.0			40.0
Collateral deposits		0.6			0.6			0.6
Restricted cash		0.4			0.4			0.4			-			-			-
Trade and other receivables		185.5			185.5			185.5			-			-			-
Non-hedge derivative assets		14.3			14.3			14.3			-			-			-
	$	782.6		$	782.6		$	782.6		$	-		$	-		$	-
Non-derivative financial liabilities
Trade and other payables	$	(255.2	)	$	(255.2	)	$	(255.2	)	$	-		$	-		$	-
Agreements with communities 1		(68.4	)		(99.0	)		(26.1	)		(17.0	)		(8.3	)		(47.6	)
Senior unsecured notes		(1,111.1	)		(1,305.7	)		(59.1	)		(654.4	)		(592.2	)		-
Wheaton refund liability		(7.3	)		(79.2	)		-			-			-			(79.2	)
	$	(1,442.0	)	$	(1,739.1	)	$	(340.4	)	$	(671.4	)	$	(600.5	)	$	(126.8	)
Derivative financial liabilities
Non hedge derivative contracts	$	(0.3	)	$	(0.3	)	$	(0.3	)	$	-		$	-		$	-
	$	(0.3	)	$	(0.3	)	$	(0.3	)	$	-		$	-		$	-
1 Represents the Peru community agreement obligation, excluding interest.

75

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

30. Commitments

(a) Capital commitments

As at December 31, 2025, Hudbay had outstanding capital commitments in Manitoba of approximately $18.6 million of which $18.4 million can be terminated, approximately $10.5 million in British Columbia of which $nil can be terminated, approximately $25.7 million in Peru all of which can be terminated, and approximately $123.4 million in Arizona, primarily related to the Copper World Complex, of which $121.2 million can be terminated.

(b) Non-capitalized lease commitments

Hudbay has entered into various non-capitalized lease commitments for facilities and equipment. The leases expire in periods ranging from one to two years. There are no restrictions placed on the Company by entering into these leases. Future minimum lease payments under such cancellable leases recognized within results from operating activities at December 31 are:

		2025			2024
Within one year	$	24.5		$	16.7
After one year but not more than five years		52.3			7.7
More than five years		2.1			2.9
	$	78.9		$	27.3

(c) Contingent liabilities

Hudbay is involved in various claims, litigation and other matters arising in the ordinary course and conduct of business. While it is not possible to determine the ultimate outcome of such actions at this time, and inherent uncertainties exist in predicting such outcomes, it is Hudbay's belief that the ultimate resolution of such actions is not reasonably likely to have a material adverse effect on its consolidated financial position or results of operations. The assessment of contingencies inherently involves the exercise of significant judgement and estimates of the outcome of future events. As a result of the assessment, management believes that no significant contingent liabilities exist.

76

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

31. Related parties

(a) Group companies

The financial statements include the financial statements of the Company and the following significant subsidiaries:

				Beneficial ownership of ultimate controlling party (Hudbay Minerals Inc.)
Name	Jurisdiction	Business	Entity's Parent	2025	2024
HudBay Peru Inc.	British Columbia	Holding company	HMI	100%	100%
HudBay Peru S.A.C.	Peru	Exploration/ development	HudBay Peru Inc.	100%	100%
HudBay (BVI) Inc.	British Virgin Islands	Precious metals sales	HudBay Peru Inc.	100%	100%
Hudbay Arizona Inc.	British Columbia	Holding company	HMI	100%	100%
Copper World LLC.	Arizona	Exploration/ development	HudBay Arizona (US) Holding Corporation	100%	100%
Mason Resources (US) Inc.	Nevada	Exploration/ development	Hudbay Arizona (US)	100%	100%
HudBay Arizona (Barbados) SRL	Barbados	Precious metals sales	Hudbay Arizona Inc.	100%	100%
Copper Mountain Mine (BC) Ltd.	British Columbia	Exploration/ development	HMI	100%	75%

Transactions between the Company and its subsidiaries, which are related parties of the Company, have been eliminated on consolidation and are not disclosed in this note.

(b) Compensation of key management personnel

The Company's key management includes members of the Board of Directors, Hudbay's Chief Executive Officer, Chief Financial Officer, Chief Operating Officer, Senior Vice Presidents and Vice Presidents. Total compensation to key management personnel was as follows:

		Year ended December 31,
		2025			2024
Short-term employee benefits1	$	11.1		$	11.1
Post-employment benefits		1.0			0.9
Termination benefits		-			0.7
Long-term share-based awards2		9.0			3.6
	$	21.1		$	16.3

77

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

¹ Such as salaries and social security contributions, paid annual leave and paid sick leave, profit-sharing, termination benefits, bonuses and non-monetary benefits (such as medical care, housing, cars and free or subsidized goods or services) for current employees.

² Long-term share-based awards are based on disbursements made during the year.

(c) Transaction with related parties

All transactions with related parties have occurred in the normal course of the Company's operations. MMC was a related party until April 30, 2025, the date Hudbay completed the acquisition of MMC's 25% interest in CMBC. Accordingly, the MMC related party transactions disclosed below for the year ended December 31, 2025, reflect activity from January 1, 2025 to April 30, 2025.

i. During the year ended December 31, 2025, the Company sold copper concentrate under the provision of a long-term contract with MMC for revenues totaling $78.0 million (December 31, 2024 - $274.1 million) including pricing adjustments. As at December 31, 2025, the Company had nil of trade receivables related to these sales outstanding (December 31, 2024 - $45.3 million).

ii. During the year ended December 31, 2024, the Company obtained cash advances on certain concentrate shipments from MMC. For the year ended December 31, 2024, interest expense on these advances amounted to $0.9 million. For the year ended December 31, 2025 no cash advances were received.

iii. During the year ended December 31, 2025, the Company recorded unrealized foreign exchange and foreign currency translation gains on intra-group loan balances totaling $21.6 million (December 31, 2024 - loss of $24.5 million).

32. Supplementary cash flow information

(a) Other operating activities:

		Year ended December 31,
		2025			2024
Share-based compensation paid	$	(14.2	)	$	(4.5	)
Consideration received from sale of non-core project		(14.9	)		-
Other		1.4			0.7
	$	(27.7	)	$	(3.8	)

(b) Change in non-cash working capital:

		Year ended December 31,
		2025			2024
Change in:
Trade and other receivables	$	(141.3	)	$	(36.5	)
Other financial assets/liabilities		46.3			(29.4	)
Inventories		(13.6	)		10.0
Prepaid expenses		3.5			(11.8	)
Trade and other payables		52.3			43.2
Provisions and other liabilities		(4.2	)		(0.4	)
	$	(57.0	)	$	(24.9	)

78

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

(c) Non-cash transactions:

During the year ended December 31, 2025 and 2024, Hudbay entered into the following non-cash investing and financing activities which are not reflected in the consolidated statements of income:

- Remeasurement of Hudbay's decommissioning and restoration liabilities led to a net decrease in related property, plant and equipment assets of $0.2 million (December 31, 2024 - a net decrease of $4.7 million), mainly related to changes to real discount rates associated with remeasurement of the liabilities.

- Property, plant and equipment included $17.7 million (December 31, 2024 - $25.5 million) of capital additions related to the recognition of ROU assets and $33.1 million (December 31, 2024 - $71.0 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 $39.5 million in net capital additions related to agreements with communities (December 31, 2024 - $18.6 million). Property, plant and equipment includes $2.8 million of deduction for accrued grants related to equipment eligible for credits (December 31, 2024 - nil).

79

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

33. Non-Controlling Interest

On April 30, 2025, Hudbay completed the acquisition on MMC's 25% interest in CMBC. As a result of the Transaction, Hudbay increased its ownership of the Copper Mountain mine from 75% to 100% (note 5). Prior to this, as part of the British Columbia operating segment, the Company owned 75% of CMBC. The remaining 25% ownership stake was held by MMC. The continuity of non-controlling interest balance is disclosed in the consolidated statements of changes in equity.

Summarized financial information for the Copper Mountain mine on an 100% basis is as follows:

Summarized Balance Sheets

		December 31, 2024
Assets
Cash and cash equivalents	$	12.9
Trade and other receivables		44.1
Inventories - current		37.5
Property, plant and equipment		902.9
Other assets		11.1
		1,008.5
Liabilities
Trade and other payables		37.5
Amounts due to related parties		422.6
Environmental and other provisions		35.5
Lease liabilities		20.1
Deferred tax liabilities		119.9
Other liabilities		68.9
		704.5

80

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

Summarized Statement of Income and Comprehensive (Loss)/Income

		Year ended December 31, 20251			Year ended December 31, 2024
Total revenue	$	76.5		$	274.1
Mine operating costs		56.5			210.8
Depreciation and amortization		16.5			50.1
Gross profit		3.5			13.2
Other expenses		2.6			20.2
Finance expense - related parties		14.4			31.3
Other net finance costs		5.3			16.6
Tax recovery		(2.0	)		(19.4	)
Net loss for the year	$	(16.8	)	$	(35.5	)
Total comprehensive loss	$	(4.0	)	$	(63.1	)
1 The results presented above reflect the transactions for the period January 1, 2025 to April 30, 2025, up to the date on which Hudbay completed the acquisition of MMC's 25% interest in CMBC.

The above information is presented before inter-company eliminations.

81

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

34. Segmented information

Hudbay is an integrated metals producer. When making decisions on expansions, opening or closing mines, as well as day to day operations, management evaluates the results from operating activities of the Company. Hudbay has the following reportable segments identified by the individual mining operations of Manitoba, British Columbia, Peru, as well as Arizona which holds our Copper World project. The Manitoba, British Columbia and Peru segments generate Hudbay's revenue. The Manitoba segment sells copper concentrate (containing copper, gold and silver), silver/gold doré, zinc concentrate (containing zinc and gold) and other products. The Peru segment consists of Hudbay's Constancia operation and sells copper concentrate and molybdenum concentrate. The British Columbia segment consists of the Copper Mountain operation and sells copper concentrate. Hudbay's Arizona segment consists of the Copper World project located in Arizona. Corporate and other activities include the Company's exploration activities in Chile, Canada and the State of Nevada. The exploration entities are not individually significant, as they do not meet the minimum quantitative thresholds. Corporate activities are not considered a segment and are included as a reconciliation to total consolidated results. Accounting policies for each reported segment are the same as those of the Company. Results from operating activities represents the profit earned by each segment without allocation of corporate costs. This is the measure reported to the chief operating decision-maker, Hudbay's President and Chief Executive Officer, for the purposes of resource allocation and the assessment of segment performance. Total assets and liabilities do not reflect intercompany balances, which have been eliminated on consolidation.

Year ended December 31, 2025
		Peru			Manitoba			British Columbia			Arizona			Corporate and other activities			Total
Revenue	$	1,161.2		$	748.7		$	301.1		$	-		$	-		$	2,211.0
Cost of sales
Mine operating costs		516.2			273.2			238.7			-			-			1,028.1
Depreciation and amortization		290.0			86.4			63.3			-			-			439.7
Gross profit (loss)		355.0			389.1			(0.9	)		-			-			743.2
Selling and administrative expenses		-			-			-			-			94.7			94.7
Exploration expenses		15.9			30.4			-			-			-			46.3
Other operating expenses (income)		16.2			(8.8	)		3.9			0.9			(4.4	)		7.8
Re-evaluation adjustment - environmental provision		-			0.2			-			-			-			0.2
Impairment - reversal					-						(322.3	)		-			(322.3	)
Results from operating activities	$	322.9		$	367.3		$	(4.8	)	$	321.4		$	(90.3	)	$	916.5
Consideration received from sale of non-core project																	(14.9	)
Net interest expense on long term debt																	60.7
Accretion on streaming arrangements																	19.9
Change in fair value of financial instruments																	(52.9	)
Other net finance income																	(8.3	)
Income before tax																	912.0
Tax expense																	347.7
Net income for the year																$	564.3

82

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

Year ended December 31, 2024
		Peru			Manitoba			British Columbia			Arizona			Corporate and other activities			Total
Revenue	$	1,049.7		$	697.4		$	274.1		$	-		$	-		$	2,021.2
Cost of sales
Mine operating costs		517.4			312.6			210.8			-			-			1,040.8
Depreciation and amortization		270.3			106.2			50.1			-			-			426.6
Gross profit		262.0			278.6			13.2			-			-			553.8
Selling and administrative expenses		-			-			-			-			57.0			57.0
Exploration expenses		16.5			24.4			-			-			1.7			42.6
Other operating expenses		15.7			15.8			17.1			8.3			0.5			57.4
Re-evaluation adjustment - environmental provision		-			(3.5	)		-			-			-			(3.5	)
Results from operating activities	$	229.8		$	241.9		$	(3.9	)	$	(8.3	)	$	(59.2	)	$	400.3
Net interest expense on long term debt																	69.8
Accretion on streaming arrangements																	24.2
Change in fair value of financial instruments																	16.6
Other net finance expense																	38.1
Income before tax																	251.6
Tax expense																	183.8
Net income for the year																$	67.8

December 31, 2025
		Peru			Manitoba			British Columbia			Arizona			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
1Included in Corporate and Other activities is $33.9 million of property, plant and equipment that is located in Nevada.
2Other non-current assets includes receivables, inventory, intangibles and other assets.

December 31, 2025
		Peru			Manitoba			British Columbia			Arizona			Corporate and other activities			Total
Additions to property, plant and equipment	$	207.0		$	64.9		$	228.1		$	82.2		$	0.3		$	582.5

83

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

December 31, 2024
		Peru			Manitoba			British Columbia			Arizona			Corporate and other activities			Total
Total assets	$	2,410.0		$	547.4		$	1,076.0		$	757.3		$	696.9		$	5,487.6
Total liabilities		960.0			421.3			281.9			14.7			1,162.3			2,840.2
Property, plant and equipment1		1,897.1			595.1			900.7			747.1			41.4			4,181.4
Other Non-Current Assets2		47.8			17.2			8.0			0.2			0.6			73.8

¹Included in Corporate and Other activities is $27.7 million of property, plant and equipment that is located in Nevada.

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

December 31, 2024
		Peru			Manitoba			British Columbia			Arizona			Corporate and other activities			Total
Additions to property, plant and equipment	$	177.8		$	63.3		$	214.9		$	30.2		$	-		$	486.2

84

HUDBAY MINERALS INC.
Notes to Audited Consolidated Financial Statements
(in millions of US dollars, except where otherwise noted)
Years ended December 31, 2025 and 2024

Geographical Segments

The following tables represent revenue information regarding Hudbay's geographical segments for the years ended December 31, 2025 and 2024:

		2025			2024
Revenue by customer location 1
China	$	923.4		$	755.0
Canada		702.0			741.1
Japan		320.2			274.1
India		148.0			82.0
Germany		44.5			-
Peru		22.2			-
South Korea		19.5			23.0
United States		14.5			67.4
Chile		11.1			-
Philippines		4.2			63.9
Netherlands		1.4			-
Switzerland		-			13.6
Belgium		-			1.1
	$	2,211.0		$	2,021.2

¹ Presented based on the ultimate destination of the product if known. If the eventual destination of the product sold through traders is not known then revenue is allocated to the location of the customer's business office and not the ultimate destination of the product.

During the year ended December 31, 2025, six customers accounted for approximately 22%, 14%, 11%, 7%,  6% and 6%, respectively, of total revenue during the year. Revenue from these customers has been presented in the Manitoba, British Columbia and Peru operating segments.

During the year ended December 31, 2024, six customers accounted for approximately 24%, 14%, 9%, 7%, and 6%, respectively, of total revenue during the year. Revenue from these customers has been presented in the Manitoba, British Columbia and Peru operating segments.

35. Events after reporting period

On January 9, 2026, Hudbay closed the previously announced strategic investment from Mitsubishi for a 30% minority interest in Copper World, which owns the fully-permitted Copper World project in Arizona. On closing, Mitsubishi contributed approximately $420 million of cash to Copper World, and it will contribute an additional $180 million in cash within 18 months in accordance with the terms of the definitive subscription agreement. As a result of the strategic investment, Hudbay continues to control Copper World and the Copper World Transaction will be accounted for as an equity transaction resulting in the recognition of non-controlling interest.

85

Management's Discussion and Analysis of

Results of Operations and Financial Condition

For the year ended

December 31, 2025

February 19, 2026

TABLE OF CONTENTS	Page
Introduction	1
Hudbay's Business	1
Hudbay's Purpose	2
Hudbay's Strategy	2
Summary	4
Key Financial Results	9
Key Production Results	10
Key Costs Results	10
Recent Developments	11
Climate Change Initiatives	15
Peru Operations Review	16
Manitoba Operations Review	22
British Columbia Operations Review	27
Outlook	32
Financial Review	39
Liquidity and Capital Resources	49
Financial Risk Management	54
Trend Analysis and Quarterly Review	56
Non-GAAP Financial Performance Measures	59
Accounting Changes	80
Critical Accounting Judgments and Estimates	80
Disclosure Controls and Procedures and Internal Control over Financial Reporting	82
Notes to Reader	83
Summary of Historical Results	86

INTRODUCTION

This Management's Discussion and Analysis ("MD&A") dated February 19, 2026 is intended to supplement Hudbay Minerals Inc.'s consolidated financial statements and related notes for the year ended December 31, 2025 and 2024 (the "consolidated financial statements"). The consolidated 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 December 31, 2025.

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 83 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 financial statements in the future, is contained in Hudbay's continuous disclosure materials, including its most recent Annual Information Form, consolidated 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 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.

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HUDBAY'S PURPOSE

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 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.

HUDBAY'S STRATEGY

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.

The Company believes that copper is the commodity with the best long-term supply/demand fundamentals and offers shareholders the greatest opportunity for sustained risk-adjusted returns. Copper is essential for achieving energy transition and AI technology needs - it is one of the most heavily utilized metals in renewable energy systems and is a key component for power networks, circuit boards and cooling systems in data processing centres. Through the discovery and successful development of economic mineral deposits, and through highly efficient low-cost operations to extract the metals, Hudbay believes sustainable value will be created for all stakeholders.

Hudbay's successful development, ramp-up and operation of the Constancia open-pit mine in Peru, the Company's long history of underground mining and full life-cycle experience in northern Manitoba, its track record of reserve expansion through effective exploration, and its organic pipeline of copper development projects including Copper World and Mason provide the Company with a competitive advantage to deliver sustainable value relative to other mining companies of similar scale.

Over the past decade, Hudbay has built a world-class asset portfolio by executing a consistent long-term growth strategy focused on copper. The Company continuously works to generate strong free cash flow and optimize the value of its producing assets through exploration, brownfield expansion projects and efficient and safe operations. Furthermore, Hudbay intends to sustainably grow through the exploration and development of its robust project pipeline, as well as through the acquisition of other properties that fit the Company's stringent strategic criteria.

To ensure that any investment in existing assets or acquisition of other mineral assets is consistent with the Company's purpose and mission, Hudbay has established a number of criteria for evaluating these opportunities. The criteria include the following:

- Sustainability: Hudbay is focused on jurisdictions that support responsible mining activity. The current geographic focus is on select investment grade countries in the Americas, with strong rule of law and respect for human rights consistent with the Company's long-standing focus on environmental, social and governance ("ESG") principles;

- Copper Focus: Hudbay believes copper is the commodity with the best long-term supply/demand fundamentals. Global copper mine supply is challenged due to declining industry grades, major disruptions at large mines, limited exploration success and an insufficient pipeline of development-ready projects, while demand is expected to continue to increase through global decarbonization initiatives and the rapid growth in AI data processing centres. Hudbay believes this long-term supply/demand gap will create opportunities for increased risk-adjusted returns. While the Company's primary focus is on copper, it recognizes and values the polymetallic nature of copper deposits and, in particular, the complementary benefits of gold in the Company's portfolio;

- Quality: Hudbay is focused on investing in long-life, low-cost, expandable, high-quality assets that can capture peak pricing of multiple commodity price cycles and can generate free cash flow through the troughs of price cycles;

- Potential: Hudbay considers the full spectrum of acquisition and investment opportunities, from early-stage exploration to producing assets, that offer significant incremental potential for exploration, development, expansion and optimization beyond the stated resources and mine plan;

- Process: Hudbay develops a clear understanding of how an investment or acquisition can create value through its robust due diligence and capital allocation process that applies the Company's technical, social, operational and project execution expertise;

- Operatorship: Hudbay believes value is created through leveraging its competitive advantages in safe and efficient operations, effective exploration, proven project development and strong community relations. While operatorship is a key criterion, Hudbay is open to joint ventures and partnerships that de-risk its portfolio and increase risk-adjusted returns; and

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- Capital Allocation: Hudbay pursues investments and acquisitions that are accretive on a per share basis. Given that the Company's strategic focus includes allocating capital to assets at various stages of development, when evaluating accretion, it will consider measures such as internal rate of return ("IRR"), return on invested capital ("ROIC"), net asset value per share and the contained value of reserves and resources per share.

Hudbay's key objectives for 2026 are focused on continued operational excellence, advancement of organic growth opportunities and prudent capital allocation to deliver attractive high-return growth:

1. Demonstrate continued operational excellence to generate substantial free cash flow through consistent copper and gold production, industry-leading cost performance and high-return brownfield reinvestment opportunities.

◦ Increase mill throughput at Constancia to approximately 90,000 tonnes per day in the second half of 2026 through the installation of two pebble crushers.

◦ Continue mill throughput improvements at New Britannia and recovery enhancements at the Stall mill.

◦ Advance the 1901 deposit towards full production by the end of 2027.

◦ Ramp up mill throughput at Copper Mountain  to its permitted capacity of 50,000 tonnes per day in the second half of 2026.

2. Advance attractive organic growth opportunities to deliver significant increase in long-term production.

◦ Complete the definitive feasibility study at Copper World in mid-2026 with final sanctioning decision expected in 2026.

◦ Progress New Ingerbelle permitting and development activities to add production and mine life extension at Copper Mountain.

◦ Advance economic evaluations of regional satellite properties in Snow Lake, including the Talbot copper-gold-zinc deposit and the New Britanna gold deposit, to further optimize the mine plan and extend mine life.

◦ Execute extensive Snow Lake exploration program to look for new anchor deposits to meaningfully extend mine life.

◦ Initiate pre-feasibility study activities at Mason to de-risk project development.

◦ Advance Flin Flon tailings reprocessing opportunities through pre-feasibility analysis.

◦ Prepare for exploration activities at Maria Reyna and Caballito to identify high-grade satellite deposits within trucking distance of Constancia's milling infrastructure and provide significant long-term upside potential in Peru.

3. Implement the Capital Allocation Framework to maintain strong financial discipline and maximize returns.

◦ Continue to reduce total debt outstanding and maintain significant financial flexibility throughout Copper World project build.

◦ Source the most efficient project level financing for Copper World as part of the Company's prudent financial plan for developing the project.

◦ Evaluate all types of capital redeployment opportunities, including reinvestments and shareholder returns to generate the highest risk-adjusted returns.

3

SUMMARY

Delivered Record Annual Revenue and Adjusted EBITDA; Achieved 2025 Consolidated Copper and Gold Production and Cost Guidance

• Achieved record annual revenue of $2,211.0 million and record annual adjusted EBITDA¹ of $1,060.9 million in 2025, demonstrating the resilience and strength of Hudbay's diversified operating platform.

• Achieved full year consolidated copper and gold production guidance, with 118,188 tonnes of copper and 267,934 ounces of gold, despite mandatory wildfire evacuations in Manitoba and temporary operational interruptions in Peru resulting in production deferrals during the year.

• 2025 represents the 11th consecutive year in which Hudbay achieved its annual consolidated copper production guidance, since Constancia declared commercial production, and the 5th consecutive year achieving its annual consolidated gold production guidance, since establishing standalone gold production guidance⁴.

• Significantly outperformed the twice-improved 2025 consolidated cash cost guidance driven by strong cost control, higher metal prices and meaningful exposure to gold by-product credits resulting in consolidated cash cost¹ and sustaining cash cost¹, net of by-product credits, of $(0.22) and $1.30 per pound of copper, respectively, in 2025, an improvement of 148% and 20%, respectively, compared to 2024.

• Peru operations produced 85,155 tonnes of copper and 74,480 ounces of gold in 2025 with full year copper production within the 2025 guidance range while gold production far exceeded the top end of the annual guidance range. This production output was attributable to the optimization of the mine plan in 2025 by prioritizing Pampacancha mining activities and fully depleting the high-grade satellite deposit in December. Peru also leveraged the use of stockpiled ore during the third quarter of 2025 as the Company adapted its mine plan due to the social unrest experienced in the region. Peru full year cash cost¹ of $1.08 per pound of copper outperformed the low end of the 2025 annual guidance range of $1.35 to $1.65 per pound as a result of stable operating cost performance and higher by-product credits.

• Manitoba operations produced 173,453 ounces of gold, 9,249 tonnes of copper, 17,646 tonnes of zinc and 800,198 ounces of silver in 2025. Production was below the low end of the guidance range for gold and zinc, while copper and silver production was within the guidance range in 2025. These production levels were achieved despite the impacts of over two months of production deferrals due to wildfire evacuations, ramp-up activities throughout the summer and unexpected downtime from an eight day weather-related power outage in October. In addition, zinc production was lower than the guidance range as gold production was prioritized in Manitoba. Manitoba full year cash cost¹ of $549 per ounce of gold outperformed the low end of the 2025 annual guidance range of $650 to $850 per ounce as a result of productivity gains and lower treatment and refining charges.

• British Columbia operations produced 23,784 tonnes of copper, 20,001 ounces of gold and 252,811 ounces of silver in 2025. Copper production was below the low end of the production guidance range, while the operations achieved full year 2025 production guidance for gold and silver. Copper production in 2025 was impacted by reduced throughput at the primary semi-autogenous grinding ("SAG") mill in the fourth quarter of 2025 and a higher portion of low-grade stockpiles utilized as ore feed in 2025. British Columbia full year cash cost¹ of $3.06 per pound of copper achieved the 2025 annual cost guidance range of $2.45 to $3.45 per pound.

Delivered Strong Fourth Quarter Financial Results Driven by Resilient Operating Performance

• Achieved record quarterly revenue of $732.9 million and record quarterly adjusted EBITDA¹ of $385.9 million in the fourth quarter of 2025.

• Demonstrated strong operational performance in the fourth quarter of 2025 as operations normalized after temporary production interruptions in the third quarter with consolidated copper production of 33,069 tonnes and consolidated gold production of 84,298 ounces.

• Maintained industry-leading cost performance in the fourth quarter with consolidated cash cost¹ and sustaining cash cost¹ per pound of copper produced, net of by-product credits, of $(0.63) and $0.94, respectively.

• Peru operations had the strongest quarter of the year in the fourth quarter with production of 25,038 tonnes of copper, 32,865 ounces of gold and 731,017 ounces of silver as strong copper and gold grades were mined from Pampacancha and less ore was processed from low-grade stockpiles. Hudbay continued to optimize the mine plan during the quarter with more ore mined from Pampacancha than previously expected, resulting in the accelerated depletion of Pampacancha, in late December compared to early 2026. Peru cash cost¹, net of by-product credits, was $0.57  per pound of copper in the fourth quarter, outperforming the low end of the annual cost guidance range.

• Manitoba operations produced 47,423 ounces of gold in the fourth quarter, slightly lower than quarterly cadence expectations due to unplanned down time in October from an eight-day weather-related power outage, offset by record monthly throughput at the New Britannia mill in December. Manitoba operations also produced 3,326 tonnes of copper, 5,703 tonnes of zinc and 214,493 ounces of silver in the fourth quarter. Manitoba cash cost¹, net of by-product credits, was $705 per ounce of gold in the fourth quarter, well within the annual cost guidance range.

• British Columbia operations produced 4,705 tonnes of copper, 4,010 ounces of gold and 57,475 ounces of silver in the fourth quarter. While the operations completed construction of the permanent feed system for the new second SAG mill in December, total throughput in the fourth quarter was constrained by the primary SAG mill requiring unplanned maintenance early in the fourth quarter of 2025. British Columbia cash cost¹, net of by-product credits, was $4.82 per pound of copper in the fourth quarter, reflecting the production impacts from the primary SAG mill maintenance.

• Fourth quarter net earnings attributable to owners and earnings per share attributable to owners were $128.0 million and $0.32, respectively, reflecting the strong gross margins as a result of higher metal prices and a $25.0 million business interruption insurance recovery related to the mandatory wildfire evacuations in Manitoba during the year. After adjusting for the insurance recovery and other non-cash items, fourth quarter adjusted earnings¹ per share attributable to owners was $0.22.

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• The strong gross margins achieved in the fourth quarter of 2025 resulted in higher employee profit sharing expenses of $36.1 million recorded within cost of sales.

Achieved Deleveraging Targets Ahead of Schedule

• 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 expand 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 continues to represent a growing portion of total revenues at 38% of total revenue in 2025, including 41% of revenue in the fourth quarter, compared to 35% in 2024.

• Delivered another quarter of record free cash flow¹ generation with $228.2 million achieved during the fourth quarter of 2025, resulting in $387.9 million in free cash flow in 2025.

• Achieved adjusted EBITDA¹ of $385.9 million in the fourth quarter of 2025, resulting in record annual adjusted EBITDA¹ of $1,060.9 million.

• Repurchased and retired an additional $39.3 million of senior unsecured notes through open market purchases at a discount to par during the fourth quarter of 2025 reducing total debt to $1.0 billion as of December 31, 2025. Since the end of 2024, Hudbay has reduced its long-term debt by $185.1 million.

• Net debt¹ decreased by $86.0 million to $439.7 million as at December 31, 2025 compared to $525.7 million at December 31, 2024.

• Net debt to adjusted EBITDA ratio¹ was 0.4x at the end of the fourth quarter of 2025, a further improvement from 0.6x at the end of the fourth quarter of 2024.

• After giving effect to the recent closing of the Copper World joint venture transaction, which occurred in January 2026, Hudbay's post-closing adjusted cash and cash equivalents as at December 31, 2025 were approximately $992 million³. In addition, Hudbay had undrawn availability of $424.8 million under its revolving credit facilities as of December 31, 2025, increasing its total post-closing adjusted liquidity to over $1.4 billion³.

Implementing Holistic Capital Allocation Framework to Maintain Strong Financial Discipline, Deliver Growth Initiatives and Maximize Long-term Risk-adjusted Returns

• Enhanced Capital Allocation Framework embedded into Hudbay's annual financial planning cycle to provide a holistic approach to capital allocation decisions, including capital deployment into brownfield projects, greenfield projects and strategic investments, while considering debt repurchases, share buybacks and dividends.

• Hudbay's recent financial transformation has positioned the Company to introduce a new quarterly dividend of C$0.01 per share, an annual increase of 100% compared to its former semi-annual C$0.01 per share dividend, representing the Company's first dividend increase in its history.

• Closed the accretive $600 million joint venture transaction with Mitsubishi Corporation ("Mitsubishi") in January 2026, securing a premier, long-term 30% strategic partner for the development of Copper World. Definitive feasibility study on track for completion in mid-2026 with a sanctioning decision expected in 2026.

• Ongoing optimization efforts at Copper Mountain include executing an accelerated stripping campaign to deliver higher grades starting in 2027 and mill improvement initiatives to achieve the permitted mill throughput capacity of 50,000 tonnes per day in the second half of 2026.

• Expected to deliver higher mill throughput rates at Constancia in the second half of 2026 with the installation of pebble crushers.

• Continued 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.

• Underground infrastructure established at the 1901 deposit to enable exploration drilling throughout 2026 and prepare for full production by the end of 2027.

• Drilling activities have increased at the copper-gold-zinc Talbot deposit near Snow Lake with six drill rigs deployed and several step-out drill holes indicating resource expansion potential.

• Engineering work advances on the Flin Flon tailings reprocessing opportunity to assess the economic viability of producing critical minerals and precious metals and the potential to reduce the overall environmental footprint.

• Advancing plans to initiate a pre-feasibility study for the Mason copper project in Nevada.

2026 Guidance Reflects Stable Copper and Gold Production at Industry-leading Margins

• Consolidated copper production of 124,000 tonnes, based on the midpoint of the 2026 guidance range, is expected to increase by 5% compared to 2025 levels, reflecting higher expected production in British Columbia with the anticipated mill throughput ramp-up to the targeted 50,000 tonnes per day in the second half of 2026, partially offset by lower grades in Peru with the depletion of Pampacancha in 2025.

5

• Consolidated gold production of 244,500 ounces, based on the midpoint of the 2026 guidance range, is expected to be lower than 2025 production, reflecting the depletion of Pampacancha in 2025, but higher in unstreamed gold ounces with higher gold production in Manitoba from mill throughput at New Britannia continuing to exceed expectations.

• Consolidated cash cost¹, net of by-product credits, in 2026 is expected to be within ($0.30) to ($0.10) per pound of copper, benefiting from higher gold production and a continued focus on maintaining stable operating costs across the business, driving industry-leading margins.

• Total sustaining capital expenditures are expected to be $435 million in 2026, reflecting approximately $38 million in deferrals from 2025 and $44 million in one-time sustaining capital projects at the operations.

• As the Company embarks on generational reinvestments, total growth capital expenditures at the operations are expected to be $140 million in 2026, including approximately $23 million in deferrals from 2025, to advance several high-return growth projects in 2026 to deliver increased copper exposure, including Peru mill throughput enhancement projects, early works at the New Ingerbelle expansion project in British Columbia, and excludes growth capital related to the Copper World joint venture.

• Growth capital expenditures at Copper World are expected to be $135 million in 2026 for project feasibility, de-risking and pre-sanctioning costs, which have been fully funded by the proceeds received from Mitsubishi as part of the closing of the Copper World joint venture transaction in January 2026, and include approximately $60 million for accelerated long lead items and de-risking activities and $35 million of capital deferrals from 2025.

Summary of Fourth Quarter Results

Hudbay's diversified asset portfolio delivered consolidated copper production of 33,069 tonnes and consolidated gold production of 84,298 ounces in the fourth quarter of 2025. Consolidated copper and gold production was higher than the third quarter of 2025 due to strong copper and gold grades from Pampacancha and less ore processed from low-grade stockpiles compared to the third quarter. Consolidated gold production also benefitted from the ramp-up to full operations in Snow Lake after the mandatory wildfire evacuations were lifted in the third quarter of 2025 and record monthly throughput at the New Britannia mill in December. Consolidated silver production of 1,002,985 ounces and zinc production of 5,703 tonnes in the fourth quarter of 2025 were also higher than the third quarter of 2025 for the aforementioned reasons.

Cash generated from operating activities of $209.4 million decreased compared to the same period in 2024 as the strong gross margins during the quarter was offset by the impacts of changes in non-cash working capital from a higher receivable balance as a result of the timing of sales as well as higher cash taxes paid compared to the same period in 2024. Cash generated from operating activities increased compared to the third quarter of 2025 as a result of higher gross margins driven by strong metal prices and higher sales volumes compared to the third quarter which was impacted by mandatory wildfire evacuations in Manitoba and a temporary operational interruption in Peru. Operating cash flow before change in non-cash working capital was $336.9 million during the fourth quarter of 2025, reflecting an increase of $266.6 million from the third quarter of 2025. This significant increase reflects higher copper and gold sales volumes from normalized operations after temporary interruptions and higher metal prices.

Adjusted EBITDA¹ was $385.9 million in the fourth quarter of 2025, an increase compared to $142.6 million in the third quarter of 2025 as higher realized metal prices and higher copper and gold sales volume resulted in strong gross margins during the quarter.

Net earnings attributable to owners was $128.0 million, or $0.32 per share, in the fourth quarter of 2025 compared to $222.4 million, or $0.56 per share, in the third quarter of 2025 and $21.2 million, or $0.05 per share, in the fourth quarter of 2024. The decrease in earnings compared to the third quarter of 2025 is a result of a non-cash after-tax gain of $242.7 million from a full impairment reversal relating to Hudbay's Copper World project that occurred in the third quarter. The increase in earnings compared to the fourth quarter of 2024 is driven by higher realized metal prices resulting in strong gross margin as well as a $25.0 million business interruption insurance recovery related to the Manitoba mandatory wildfire evacuation shutdowns.

Adjusted net earnings attributable to owners¹ and adjusted net earnings per share attributable to owners¹ in the fourth quarter of 2025 were $86.0 million and $0.22 per share, respectively, after adjusting for various non-cash items on a pre-tax basis including a $25.0 million business interruption insurance recovery related to the Manitoba mandatory wildfire evacuations during the year, a $5.7 million mark-to-market revaluation gain on various instruments such as investments and share-based compensation, and a non-cash $5.4 million foreign exchange gain, among other items. This compares to adjusted net earnings attributable to owners¹ and net earnings per share attributable to owners¹ of $70.3 million and $0.18 per share in the fourth quarter of 2024 and $10.1 million and $0.03 per share in the third quarter of 2025. The increase compared to the fourth quarter of 2024 is for the same reasons discussed above for net earnings. The increase compared to the third quarter of 2025 is a result of higher realized metal prices and higher sales volumes.

Consolidated cash cost¹, net of by-product credits,  in the fourth quarter of 2025 was $(0.63) per pound of copper, compared to $0.42 per pound in the third quarter of 2025 and $0.45 in the fourth quarter of 2024, as Hudbay continued to demonstrate strong cost control across its operations. The decrease in cash cost from the comparative periods was a result of higher by-product credits reflecting the benefits of Hudbay's diversified asset portfolio with higher realized prices across all metals.

Consolidated sustaining cash cost¹, net of by-product credits, in the fourth quarter of 2025 was $0.94 per pound of copper, compared to $2.09 per pound in the third quarter of 2025 and $1.37 per pound in the fourth quarter of 2024. The decrease was primarily due to the same factors impacting consolidated cash cost noted above, partially offset by planned higher cash sustaining capital expenditures.

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Consolidated all-in sustaining cash cost¹, net of by-product credits, in the fourth quarter of 2025 was $1.43  per pound of copper, lower than the third quarter of 2025 and the fourth quarter of 2024 mainly due to the same reasons noted above, partially offset by higher corporate general and administrative ("G&A") costs from the revaluation of Hudbay's stock-based compensation due to a higher share price.

As at December 31, 2025, total liquidity was $993.7 million, including $568.9 million in cash and cash equivalents, and undrawn availability of $424.8 million under Hudbay's revolving credit facilities. Net debt¹ at the end of the fourth quarter was $439.7 million, marking an $86.0 million improvement from fourth quarter of 2024 as a result of deleveraging activities which included the repurchase and retirement of senior unsecured notes. After giving effect to the closing of the Copper World joint venture transaction, post-closing adjusted cash and cash equivalents as of December 31, 2025 are approximately $992 million³, total post-closing adjusted liquidity increases to over $1.4 billion³ and post-closing net debt¹ is approximately zero. Hudbay expects that the current liquidity, together with cash flows from operations, will be sufficient to meet the Company's liquidity needs for the year.

Summary of Full Year Results

Hudbay achieved 2025 consolidated production guidance for copper and gold, with full year production of 118,188 tonnes of copper and 267,934 ounces of gold. In 2025, the operations also produced 17,646 tonnes of zinc, 3,468,143 ounces of silver and 1,282 tonnes of molybdenum. 2025 represents the 11th consecutive year in which Hudbay achieved its annual consolidated copper production guidance, since Constancia declared commercial production, and 5th consecutive year achieving its annual consolidated gold production guidance, since establishing standalone gold production guidance.

With respect to Hudbay's operating business units, Peru exceeded the top end of the gold production guidance and achieved the guidance ranges for copper despite the impact from the temporary operational interruption due to social unrest. While Hudbay was previously tracking within the guidance ranges in Manitoba despite the wildfires, gold and zinc production fell below the low end of the respective ranges as a result of an eight-day weather-related power outage in October. Manitoba achieved guidance for copper and silver production despite these interruptions. British Columbia achieved guidance for gold and silver production, while copper production fell below the low end of the guidance range, primarily due to unplanned maintenance at the primary SAG mill in the fourth quarter and a higher portion of low-grade stockpiles utilized as ore feed in 2025.

Cash generated from operating activities increased to $707.3 million in 2025 from $666.2 million in 2024. Operating cash flow before change in non-cash working capital increased to a record $764.3 million in 2025 from $691.1 million in 2024. The increase in operating cash flow before changes in working capital was primarily the result of higher gross margins driven by higher metal prices and stable cost performance despite temporary operational interruptions during the year. This was partially offset by a significant increase in cash taxes paid of $268.4 million, compared to $132.5 million in 2024 reflecting earlier periods of high taxable income mainly at the Peru and Manitoba operations.

Net earnings attributable to owners were $568.5 million, or $1.44 per share, in 2025, compared to $76.7 million, or $0.20 per share, in 2024. Net earnings were positively impacted by higher realized prices for all metals and a non-cash charge of $242.7 million relating to an impairment reversal with respect to the Copper World project in 2025, partially offset by higher mining and income tax expenses.

Adjusted net earnings attributable to owners¹ and adjusted net earnings per share attributable to owners¹ in 2025 were $265.5 million and $0.67 per share, respectively, after adjusting for items on a pre-tax basis such as a $322.3 million impairment reversal with respect to the Copper World project, $25.0 million in business interruption insurance recovery related to the Manitoba wildfires, $18.6 million in foreign exchange gains, and $14.9 million in consideration received from sale of a non-core project, among other items. This compares to adjusted net earnings attributable to owners¹ and net earnings per share attributable to owners¹ of $181.4 million and $0.48 per share in 2024.

Adjusted EBITDA¹ was $1,060.9 million in 2025, a 29% increase compared to $822.5 million in 2024, achieving a new annual record. The increase was the result of higher realized metal prices and stable operating performance, driving strong cost control across the business.

Consolidated cash cost¹, net of by-product credits, in the fourth quarter of 2025 was $(0.22) per pound of copper, compared to $0.46 per pound of copper in 2024. Hudbay significantly outperformed its twice-improved 2025 consolidated cash cost guidance as a result of higher metal prices with a significant increase in gold by-product credits, partially offset by higher G&A due to higher employee profit sharing in Peru and Manitoba.

Consolidated sustaining cash cost¹, net of by-product credits¹, in the fourth quarter of 2025 was $1.30 per pound of copper in 2025 decreased from $1.62 per pound of copper in 2024 due to the same reasons affecting cash cost, partially offset by higher cash sustaining capital expenditures. Hudbay outperformed the improved 2025 consolidated sustaining cash cost guidance as a result of the same reasons driving the outperformance on cash cost guidance.

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Consolidated all-in sustaining cash cost¹, net of by-product credits, in the fourth quarter of 2025 was $1.74  per pound of copper in 2025, lower than $1.88 per pound of copper in 2024 as a result of the same reasons outlined above, partially offset by higher corporate selling and administrative costs primarily due to a revaluation of share-based compensation associated with a higher share price.

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

¹ 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 MD&A.

² Liquidity includes $568.9 million in cash and cash equivalents as well as undrawn total availability of $424.8 million under Hudbay's revolving credit facilities.

³ The post-closing adjusted year-end cash and cash equivalents of $992 million includes December 31, 2025 cash and cash equivalents balance of $568.9 million and approximately $420 million of cash at the Copper World LLC level, which is designated for exclusive use by the Copper World joint venture. Post-closing adjusted liquidity includes the pro-forma cash and cash equivalent plus the undrawn availability of $424.8 million under Hudbay's revolving credit facilities.

⁴ In 2020, Hudbay's consolidated copper production guidance range was revised during the year due to the impact of COVID-19 at the operations. Hudbay's copper production was within the revised guidance ranges. Prior to 2021, Hudbay provided guidance on a precious metal equivalent instead of gold as a standalone metal.

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KEY FINANCIAL RESULTS

Financial Condition
(in $ millions, except net debt to adjusted EBITDA ratio)		Dec. 31, 2025			Dec. 31, 2024
Cash and cash equivalents and short-term investments	$	568.9		$	581.8
Total long-term debt		1,008.6			1,107.5
Net debt1		439.7			525.7
Working capital2		(65.6	)		511.3
Total assets		6,223.3			5,487.6
Equity attributable to owners of the Company		3,231.0			2,553.2
Net debt to adjusted EBITDA 1		0.4			0.6

¹ Net debt and net debt to adjusted EBITDA 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.

² Working capital is determined as total current assets less total current liabilities as defined under IFRS and disclosed on the consolidated financial statements. Working capital as of December 31, 2025 was impacted by an increase in the current portion of long-term debt of $472.1 million as the 2026 Notes are now maturing within one year.

Financial Performance		Three months ended									Year ended
(in $ millions, except per share amounts or as noted below)		Dec. 31, 2025			Sep. 30, 2025			Dec. 31, 2024			Dec. 31, 2025			Dec. 31, 2024
Revenue	$	732.9		$	346.8		$	584.9		$	2,211.0		$	2,021.2
Cost of sales		462.8			281.5			400.5			1,467.8			1,467.4
Earnings before tax		257.1			330.5			103.7			912.0			251.6
Net earnings		128.0			222.4			19.3			564.3			67.8
Net earnings attributable to owners		128.0			222.4			21.2			568.5			76.7
Basic and diluted earnings per share - attributable		0.32			0.56			0.05			1.44			0.20
Adjusted earnings per share - attributable1		0.22			0.03			0.18			0.67			0.48
Operating cash flow before change in non-cash working capital		336.9			70.3			231.5			764.3			691.1
Adjusted EBITDA1		385.9			142.6			257.3			1,060.9			822.5
Free cash flow1		228.2			(15.2	)		149.0			387.9			368.0

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.

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KEY PRODUCTION RESULTS

		Three months ended			Year ended		Guidance
		Dec. 31, 2025	Sep. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024	Annual 2025
Contained metal in concentrate and doré produced1
Copper	tonnes	33,069	24,205	43,262	118,188	137,943	117,000 - 149,000
Gold	oz	84,298	53,581	94,161	267,934	332,240	247,500 - 308,000
Silver	oz	1,002,985	730,394	1,311,658	3,468,143	3,983,851	3,520,000 - 4,390,000
Zinc	tonnes	5,703	548	8,385	17,646	33,339	21,000 - 27,000
Molybdenum	tonnes	325	185	195	1,282	1,323	1,300 - 1,500
Payable metal sold
Copper	tonnes	34,132	18,280	37,927	114,534	125,094
Gold2	oz	84,424	38,279	92,734	260,261	335,342
Silver2	oz	871,006	418,418	1,150,518	3,190,552	3,549,816
Zinc	tonnes	3,972	3,452	5,261	15,152	25,120
Molybdenum	tonnes	190	269	182	1,334	1,287

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.

KEY COST RESULTS

		Three months ended			Year ended		Guidance
		Dec. 31, 2025	Sep. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024	Annual 20252
Peru cash cost per pound of copper produced
Cash cost1	$/lb	0.57	1.30	1.00	1.08	1.18	1.35 - 1.65
Sustaining cash cost1	$/lb	1.53	2.11	1.48	2.02	1.86
Manitoba cash cost per ounce of gold produced
Cash cost1	$/oz	705	379	607	549	606	650 - 850
Sustaining cash cost1	$/oz	1,110	762	908	875	868
British Columbia cash cost per pound of copper produced
Cash cost1	$/lb	4.82	3.21	3.00	3.06	2.74	2.45 - 3.45
Sustaining cash cost1	$/lb	8.87	7.43	5.76	6.12	5.29
Consolidated cash cost per pound of copper produced
Cash cost1	$/lb	(0.63)	0.42	0.45	(0.22)	0.46	0.15 - 0.35
Sustaining cash cost1	$/lb	0.94	2.09	1.37	1.30	1.62	1.85 - 2.25
All-in sustaining cash cost1	$/lb	1.43	2.78	1.53	1.74	1.88

¹ Cash 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.

² Improved full year 2025 consolidated copper cash cost guidance range to $0.15 to $0.35 per pound from prior guidance of $0.65 to $0.85 per pound and the original guidance range of $0.80 to $1.00 per pound. Improved full year 2025 consolidated sustaining copper cash cost guidance range to $1.85 to $2.25 per pound from the original guidance range of $2.25 to $2.65 per pound.

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RECENT DEVELOPMENTS

Continued Free Cash Flow Generation Driving Further Debt Reduction and Significant Financial Flexibility

Hudbay has delivered several quarters of meaningful free cash flow generation as a result of steady operating performance, expanding margins from strong copper and gold exposure and a focus on cost control across the business. This has resulted in Hudbay achieving record annual adjusted EBITDA of $1,060.9 million and record annual free cash flow of $387.9 million in 2025.

As a result of the strong operating and financial performance, Hudbay continued its prudent balance sheet management and further reduced overall debt levels in the fourth quarter of 2025, resulting in a total of $102.5 million in debt repayments during the full year 2025. These deleveraging efforts have reduced total principal debt to $1,008.6 million as of December 31, 2025.

As of December 31, 2025, Hudbay had approximately $569 million in cash and cash equivalents, resulting in a reduction in net debt to $439.7 million compared to $525.7 million at December 31, 2024. Similarly, Hudbay reduced its net debt to adjusted EBITDA ratio to 0.4x at the end of the fourth quarter of 2025, a further improvement from 0.6x at the end of fourth quarter of 2024.

After giving effect to the closing of the Copper World joint venture transaction, as described below, Hudbay's post-closing adjusted cash and cash equivalents as at December 31, 2025 was approximately $992 million³. In addition, Hudbay had undrawn availability of $425 million under Hudbay's revolving credit facilities as of December 31, 2025, increasing total post-closing adjusted liquidity to over $1.4 billion³. Hudbay is well-positioned to advance Copper World and fund its several other high-return growth opportunities across the business.

Prudently Advancing Copper World Towards a Sanction Decision in 2026

In January 2026, Hudbay announced the closing of the joint venture transaction ("JV Transaction") with Mitsubishi, securing a premier, long-term strategic partner for the development of Copper World. The Company continues to progress the detailed engineering work to de-risk Copper World ahead of a sanction decision later this year.

• Realized Accretive JV Transaction - On January 12, 2026, Hudbay announced the closing of the highly accretive $600 million JV Transaction, which represents a significant de-risking milestone in advancing Copper World and further validates the premium long-term value of this world-class asset. The $420 million of proceeds received at closing from Mitsubishi will be used to directly fund the remaining definitive feasibility study ("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. The JV Transaction increases the project IRR to Hudbay to approximately 90% based on pre-feasibility study ("PFS") estimates².

• Secured Premier Strategic Joint Venture Partner - Mitsubishi is one of the largest Japanese trading houses with a global mining presence and a significant U.S.-based business. Mitsubishi is the partner of choice with investments in a world-class portfolio of large and high-quality copper assets, including five of the top twenty copper mines globally by 2024 production. This partnership validates the attractive long-term value of Copper World as a world-class copper asset and endorses the strong technical capabilities of Hudbay. It also represents the beginning of a long-term strategic partnership, and the parties are identifying other opportunities for collaboration to advance their respective copper growth strategies.

• Achieved Key Elements of Hudbay's Three Prerequisites (3-P) Plan - Hudbay has achieved the final key elements of its prudent 3-P financial strategy for the development of Copper World with the closing of the JV Transaction and the achievement of stated balance sheet targets. After accounting for proceeds from the JV Transaction, Hudbay has post-closing adjusted cash and cash equivalents of $992 million³ and reduced its post-closing net debt to adjusted EBITDA ratio to 0.0x, far exceeding the stated balance sheet targets. The Mitsubishi initial investment and its future pro-rata equity capital contributions, together with the Wheaton Precious Metals Corp. stream, provide significant financial flexibility by reducing Hudbay's estimated share of the remaining capital contributions to approximately $200 million based on PFS estimates and deferring Hudbay's first capital contribution to 2028 at the earliest.

• Feasibility Study and Detailed Engineering Underway - Feasibility activities for Copper World are well underway with expected completion of the DFS in mid-2026. Hudbay has continued to execute detailed engineering work and other de-risking activities, in preparation for a Copper World sanctioning decision expected in 2026.

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Manitoba Exploration Update

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 multi-phased drilling campaigns as part of Hudbay's threefold exploration strategy:

• Near-mine Exploration at Lalor and 1901 to Further Increase Near-term Production and Extend Mine Life - Hudbay completed the development of the initial exploration drift at the 1901 deposit in 2025 and the development of the haulage drift is underway. Hudbay received positive initial step-out drilling results from the exploration drift, and during the second half of 2025, some zinc development ore was delivered for processing at Stall. Activities at 1901 over the next two years will focus on exploration, definition drilling, orebody access, and establishing critical infrastructure for full production in late 2027. Exploration activities at 1901 will target additional step-out drilling to potentially extend the orebody and infill drilling to convert inferred mineral resources in the gold lenses to mineral reserves.

• Testing Regional Satellite Deposits to Utilize Available Processing Capacity and Increase Production - Hudbay increased its regional land package by more than 250% in 2023 through the acquisition of Rockcliff Metals Corp. ("Rockcliff"), which included the addition of several known deposits located within trucking distance of the Snow Lake processing infrastructure. The deposits acquired as part of the Rockcliff acquisition, together with several deposits already owned by Hudbay in Snow Lake, have created an attractive portfolio of regional deposits in Snow Lake, including the Talbot, New Britannia, Rail, Pen II, Watts, 3 Zone and WIM deposits. The continued strong performance from the New Britannia mill has freed up processing capacity at the Stall mill, where there is approximately 1,500 tonnes per day of available capacity which could be utilized by the regional satellite deposits to increase production and extend the life of the Snow Lake operations beyond 2037.

• Exploring Large Land Package for a New Anchor Deposit to Significantly Extend Mine Life - A majority of the land claims acquired as part of the Rockcliff acquisition have been untested by modern deep geophysics, which was the discovery method for the Lalor deposit. A large geophysics program is currently 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 geophysics program is the largest geophysics program in Hudbay's history and includes 800 kilometres of ground electromagnetic surveys and an extensive airborne geophysics survey.

Talbot Initial Drilling Results Confirm Resource Expansion Potential

Talbot is a copper-zinc-gold rich VMS deposit located within trucking distance to existing processing infrastructure in Snow Lake. Successful drilling campaigns could expand the resource base and support a PFS to upgrade the mineral resources to reserves, extending the overall mine life of the Snow Lake operations. In April 2025, Hudbay announced the signing of the exploration agreement with the Mosakahiken Cree Nation on exploration activities in their traditional and ancestral territory, including at Talbot.

In July 2025, Hudbay commenced an extensive summer drill program at Talbot focused on expanding the known mineralization at depth, testing geophysical targets as well as conducting an infill drill program in the upper part of the ore body to support a PFS. As part of the initial drilling program in 2025, Hudbay drilled six holes to test the continuity of the Talbot deposit at depth, with all the holes yielding positive results and four of them returning mineralized intercepts with economic potential (see table of intercepts below). The 2026 drilling program has now commenced with six drill rigs deployed, including one drill rig focused on continuing to expand the footprint of the deposit at depth. In addition to the intercepts below, another hole provided a significant intercept of copper mineralization over an estimated length of 19.7 metres from core logging and for which assay results are pending.

Hole ID	From (m)	To (m)	Intercept (m)	Estimated true width (m)1	Cu (%)2	Au (g/t)2	Ag (g/t)2	Zn (%)2	CuEq. (%)3,4
TLS024	1556.0	1567.5	11.5	10.4	2.4	1.8	55.1	0.8	4.2
TLS025 top	1435.3	1449.5	14.2	13.2	1.2	0.8	17.8	0.5	2.0
TLS025 bottom	1459.0	1465.0	6.0	5.6	2.0	0.7	16.9	0.5	2.6
TLS026	1265.5	1273.4	7.8	7.1	1.4	0.9	18.4	0.3	2.2
TLS027W02	1252.8	1271.5	18.8	16.3	1.4	0.8	18.9	1.3	2.4

^1.True widths are estimated based on drill angle and intercept geometry of mineralization.

² All copper, gold, silver and zinc values are uncut.

³ Copper-equivalent ("CuEq") grade calculated using the following long-term commodity price assumptions: $4.40 per pound copper, $2,800 per ounce gold, $32.00 per ounce silver and $1.25 per pound zinc.

⁴ Using the combined recoveries of New Britannia and Stall mills of 89% copper, 89% gold, 81% silver and 84% zinc.

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In 2026, the Company plans on progressing a PFS and preparing an updated mineral resource estimate for Talbot using Hudbay standard methods that have demonstrated high reserve conversion rates.

Expanded Flin Flon Exploration Partnership with Marubeni and JOGMEC

On January 22, 2026, the Company announced the signing of an amended and restated option agreement with Japan Organization for Metals and Energy Security ("JOGMEC") and Marubeni Corporation ("Marubeni"), where Hudbay granted JOGMEC an option to acquire a 10% interest in three projects located within trucking distance of Hudbay's processing facilities in Flin Flon, Manitoba. In order to exercise its option, JOGMEC is required to fund at least C$6 million in exploration expenditures over a period of approximately three years, with Hudbay acting as the operator carrying out the exploration activities. The agreement is an amendment and restatement of the option agreement with Marubeni from March 2024, pursuant to which Marubeni's wholly-owned Canadian subsidiary was granted an option to acquire a 20% interest in the three projects, provided it, funds at least C$12 million in exploration expenditures over the designated earn-in period, which is inclusive of past contributions made by Marubeni since March 2024.

The option agreement focuses on three projects in the Flin Flon region, namely Cuprus-White Lake, Westarm and North Star, which were selected by Marubeni prior to the original March 2024 agreement and following a period of detailed due diligence. All three properties hold past producing mines that generated meaningful production with attractive grades of both base metals and precious metals. The properties remain highly prospective with potential for further discovery based on the attractive geological setting, limited historical deep drilling and promising geochemical and geophysical targets. Cuprus-White Lake, Westarm and North Star are all within 20 kilometres of Hudbay's Flin Flon milling complex.

Senior Management Team Appointments

In January 2026, Hudbay appointed Audra Walsh to the role of Vice President, South America Business Unit. Ms.Walsh joined Hudbay as acting Vice President in Peru in August 2025 and has transitioned to the permanent role as a testament to her exceptional talent as a professional engineer with over 30 years of technical, operating, management, executive and board experience in the mining industry. As leader of the South America Business Unit, Ms. Walsh is responsible for the strategic performance of Hudbay's operational and exploration activities in Peru and exploration activities in Chile.

Ms. Walsh's leadership experience and deep expertise will be instrumental in helping Hudbay achieve regional milestones and drive growth in Peru with the long-life operations at Constancia, the future development of Caballito and Maria Reyna and further regional exploration.

Holistic Capital Allocation Framework to Deliver Growth and Maximize Long-Term Risk-Adjusted Returns

Hudbay has a proven track record of prudently allocating capital to high-return brownfield investments, such as the New Britannia gold mill refurbishment project and the development of the high-grade Pampacancha satellite deposit, which have delivered significant free cash flows and contributed to Company's deleveraging efforts.

Hudbay has completed a financial transformation over the past three years. The Company has moved from being overleveraged and capital constrained to a preferred position where it can strategically allocate capital across the portfolio to maximize value and generate the highest risk-adjusted returns, creating long-term sustainable value for stakeholders.

Prudent strategic financial planning and execution of the Company's 3-P plan has achieved the Company's balance sheet deleveraging goals and has lowered its cost of capital. With its strongest balance sheet in more than a decade and peer-leading credit metrics, together with the strategic investment by Mitsubishi, Hudbay is very well positioned to sanction the Copper World project and embark on generational investments in the Company's operating portfolio in 2026. These generational investments include allocating capital to high-return brownfield projects at the Company's three operating mines and advance its world-class development and exploration pipeline.

To provide transparency and continued financial discipline, Hudbay has implemented an enhanced Capital Allocation Framework to provide a holistic approach around capital allocation decisions, including with respect to the deployment of capital into the business through near-term brownfield projects, longer-term greenfield projects, strategic investments and exploration, while considering debt repurchases, share buybacks and dividends.

Hudbay's holistic Capital Allocation Framework is embedded into the Company's annual financial planning cycle and includes the following key elements:

• Preserving Balance Sheet Strength - Aligning with successful deleveraging efforts to maintaining net debt to adjusted EBITDA ratios of less than 1.0x throughout the investment and development cycle, continuing to lower the Company's cost of capital and considering unique (non-dilutive) sources of project funding available.

• Strategic Fit for Growth and Diversification - Expanding and optimizing production and mine life from the existing asset base, enhancing Hudbay's strategic commodity exposure to copper and complementary gold, targeting 400,000 tonnes of annual copper-equivalent production, increasing long-term portfolio diversification across tier-1 jurisdictions and aligning with the Company's sustainability goals.

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• Accretive Across Key Financial Metrics - Pursuing investment opportunities that are accretive to a mix of key financial performance metrics - Hudbay's net present value per share, copper-equivalent mineral resources per share, return on invested capital and cash flow yields, as well as demonstrating robust internal rate of returns and project paybacks to maximize value and long-term sustainable returns for all stakeholders.

• Rigorous Risk Assessment - Considering risk-adjusted returns based on project-specific characteristics, applying varying discount rates, commodity price scenarios and sensitivity analysis, as well as key qualitative risk considerations.

• Accountable Investment Governance - Integrating detailed project reviews as part of the annual budgeting process and executing investment decisions subject to a formal internal tollgate process, requiring Executive Committee and Board approval, followed by comprehensive post-project reviews to drive continuous improvement.

Increased Annual Dividend

Following Hudbay's recent financial transformation and consistent with its Capital Allocation Framework, the Company has commenced an increase in shareholder returns in the form of a quarterly dividend. Hudbay's Board of Directors approved the introduction of a new quarterly dividend of C$0.01 per share as the Company has achieved certain financial milestones ahead of schedule and has significantly improved its financial position. The new total annual dividend amount of C$0.04 per share represents an increase of 100% or C$0.02 per share over the previous annual dividend, which was paid semi-annually, representing the first dividend increase in the Company's history.

A quarterly dividend of C$0.01 per share was declared on February 19, 2026. The dividend will be paid out on March 27, 2026 to shareholders of record as of close of business on March 10, 2026.

¹ Adjusted EBITDA, 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 MD&A.

² Based on the initial capital investment and the $3.75 per pound copper price used in the PFS published on September 8, 2023 with assumptions of approximately $145 million for pre-sanctioning costs, $230 million from the precious metals stream, $350 million from project-level financing and approximately $700 million from Mitsubishi's $420 million initial investment, $180 million investment within 18 months and its pro-rata 30% share of future equity capital contributions.

³ The post-closing adjusted year-end cash and cash equivalents includes approximately $420 million of cash at the Copper World LLC level, including close adjustments received as part of the recent closing of the Copper World joint venture transaction, which is designated for exclusive use by the Copper World joint venture.

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CLIMATE CHANGE INITIATIVES

Since inception of Hudbay's climate change strategy in 2022, the Company continues to implement initiatives to reduce its greenhouse gas ("GHG") footprint. The Company strives to measure efficiency against key process drivers, while recognizing the unique characteristics of each business unit, such as fluctuating strip ratios in open pit mines and changing development profiles at underground mines. In 2025, Hudbay updated its climate change targets with new 2030 GHG emissions reduction targets specific to each business unit and focused on areas where the Company believes it can achieve the biggest impact. 

The Company has made significant progress towards achieving its climate change goals, including:

• Peru - Hudbay's new 10-year power purchase agreement with ENGIE Energía Perú for access to a 100% renewable energy supply to Constancia came into effect in January 2026. This is expected to be a key contributing factor towards the Peru operations reaching its 2030 target of a 99% reduction in Scope 2 GHG emissions intensity (tonnes of Scope 2 emissions per kilotonne of ore processed) compared to a 2022 baseline.

• Manitoba - Hudbay continues to expand its fleet of electric equipment for use at its underground operations. Following the successful initial trial of an electric Epiroc scooptram ST14 SG at the Lalor mine in 2023, the Company has seen reduced carbon intensity and improved ventilation due to temperature reductions in the deeper areas of the mine. Today,  Hudbay has expanded the fleet of battery electric vehicles at Lalor to 10 with two more being added in 2026. Continuing to expand the electric equipment fleet and other operational efficiency initiatives will progress the Snow Lake operations towards its 2030 target of a 25% reduction in Scope 1 GHG emissions intensity (tonnes of Scope 1 emissions per kilometre) compared to a 2022 baseline. 

• British Columbia - At the Copper Mountain mine, efforts to drive operational efficiency continue to be a core focus and will enable the B.C. operations to progress towards its 2030 target of 5% reduction in Scope 1 GHG emissions intensity (tonnes of Scope 1 emissions per kilometre) compared to a 2024 baseline. Hudbay utilizes several pieces of electric equipment at Copper Mountain, including, three electric shovels and three electric rotary blasthole drills, which reduces carbon intensity by displacing existing diesel equipment. Additionally, the Company took steps to implement renewable diesel, also known as hydrotreated vegetable oil (HVO) fuel, to power more than 50% of the haul truck fleet in 2025.

• Corporate - Hudbay integrated Scope 1 and Scope 2 GHG emissions into its long-range financial plans to support GHG reduction decision making and alignment with the Company's 2030 goals. The Company also implemented sustainability reporting software to standardize the sustainability data collection process. In January 2025, the Company established an ESG Steering Committee consisting of the COO, CFO and three SVPs to provide enhanced oversight of the Company's sustainability initiatives, procedures and disclosures.Hudbay plans to advance its Scope 3 data collection process in 2026 through supplier and customer engagement to drive transparency and influence positive GHG behaviours throughout the value chain.

15

PERU OPERATIONS REVIEW

		Three months ended			Year ended
		Dec. 31, 2025	Sep. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Constancia ore mined1	tonnes	5,610,915	564,579	4,186,058	21,539,089	15,046,190
Copper	%	0.31	0.25	0.40	0.31	0.34
Gold	g/tonne	0.03	0.02	0.04	0.03	0.04
Silver	g/tonne	3.27	1.92	3.88	3.18	3.08
Molybdenum	%	0.01	0.01	0.02	0.02	0.01
Pampacancha ore mined1	tonnes	4,152,000	4,260,081	4,037,264	9,563,442	9,317,499
Copper	%	0.43	0.38	0.63	0.40	0.55
Gold	g/tonne	0.27	0.31	0.38	0.29	0.32
Silver	g/tonne	4.84	4.87	6.43	4.78	5.61
Molybdenum	%	0.01	0.01	0.00	0.01	0.01
Total ore mined	tonnes	9,762,915	4,824,660	8,223,322	31,102,531	24,363,689
Strip ratio2		0.57	1.38	1.22	1.04	1.78
Ore milled	tonnes	7,627,853	6,991,744	7,999,453	30,292,668	31,933,624
Copper	%	0.39	0.31	0.48	0.33	0.36
Gold	g/tonne	0.18	0.16	0.20	0.11	0.14
Silver	g/tonne	4.19	3.94	5.28	3.72	3.84
Molybdenum	%	0.01	0.01	0.01	0.01	0.01
Copper concentrate	tonnes	110,431	82,796	148,283	380,211	452,473
Concentrate grade	% Cu	22.67	21.88	22.92	22.40	21.88
Copper recovery	%	84.5	83.2	87.8	84.3	85.0
Gold recovery	%	74.7	72.1	73.3	69.2	70.7
Silver recovery	%	71.1	65.2	71.4	66.7	68.8
Molybdenum recovery	%	38.8	33.9	37.1	37.4	41.7
Combined unit operating costs3,4,5	$/tonne	14.51	13.03	15.25	13.02	12.91

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

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

³ Reflects 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 Excludes approximately $1.3 million or $0.17 per tonne of overhead costs incurred during temporary suspension during the three months ended December 31, 2025, $7.3 million or $1.04 per tonne for the three months ended September 30, 2025 and $8.6 million or $0.28 per tonne during year ended December 31, 2025.

16

		Three months ended			Year ended
		Dec. 31, 2025	Sep. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Contained metal in concentrate produced
Copper	tonnes	25,038	18,114	33,988	85,155	99,001
Gold	oz	32,865	26,380	38,079	74,480	98,226
Silver	oz	731,017	577,446	969,502	2,415,134	2,708,262
Molybdenum	tonnes	325	185	195	1,282	1,323
Payable metal sold
Copper	tonnes	28,361	11,769	28,775	84,438	88,138
Gold	oz	37,874	9,798	37,459	71,755	103,364
Silver	oz	650,384	258,215	824,613	2,239,832	2,343,820
Molybdenum	tonnes	190	269	182	1,334	1,287
Cost per pound of copper produced
Cash cost1,2	$/lb	0.57	1.30	1.00	1.08	1.18
Sustaining cash cost1	$/lb	1.53	2.11	1.48	2.02	1.86

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.

² Excludes approximately $1.3 million or $0.02 per pound of overhead costs incurred during temporary suspension during the three months ended December 31, 2025, $7.3 million or $0.19 per pound during the three months ended September 30, 2025 and $8.6 million or $0.05 per pound during the year ended December 31, 2025.

Overview

Peru operations had its strongest quarter of the year in the fourth quarter, with continued strong copper and gold grades from Pampacancha and less ore processed from low-grade stockpiles compared to the third quarter of 2025. The Company continued to optimize the mine plan in the fourth quarter with more ore mined from Pampacancha than previously expected, resulting in the accelerated depletion of Pampacancha in late December as opposed to early 2026 and enabling Hudbay to exceed the top end of the 2025 Peru gold guidance range.

Despite the impacts from social unrest in the third quarter, Hudbay achieved its 2025 production guidance for copper and gold in Peru, with gold production exceeding the top end of the 2025 guidance range by 24%. Production of silver and molybdenum fell slightly short of the lower end of guidance.

As mentioned above, mining activities in the Pampacancha pit were completed during the fourth quarter and remaining stockpiled Pampacancha ore has been fully processed during January 2026.

The Company continues to advance the installation of pebble crushers in Peru to increase mill throughput rates starting in the second half of 2026, which will allow Constancia to deliver steady annual copper production despite lower grades from the depletion of Pampacancha. Hudbay's efforts to increase mill throughput align with the Peru Ministry of Energy and Mines regulatory change to allow mining companies to operate up to 10% above permitted levels.

Mining Activities

Total ore mined in the fourth quarter was 102% higher than the third quarter of 2025, a sizable increase due to the impacts from social unrest during the third quarter. Mining activities in the Pampacancha pit were completed during the fourth quarter and the remaining stockpiled Pampacancha ore was fully processed during January 2026. Total ore mined in Peru in the fourth quarter of 2025 was 19% higher than the same period in 2024, despite the ramp up required in October following the temporary operational interruption due to social unrest.

Total ore mined in Peru for the full year of 2025 was 28% higher than the same period in 2024 due to elevated waste stripping in 2024, which was partially offset by the impacts of the temporary interruption of certain mining activities during the third quarter of 2025.

17

Milling Activities

Total mill throughput increased to 7.6 million tonnes during the fourth quarter of 2025, higher than the third quarter of 2025 due to higher mechanical availability as the prior quarter was impacted by the temporary operational interruption due to social unrest, partially offset by a scheduled semi-annual mill maintenance shutdown in the fourth quarter of 2025. Milled copper grades increased by 26% compared to the third quarter 2025, primarily due to higher grades from Pampacancha and less ore processed from stockpiles. Milled gold grades increased compared to the third quarter of 2025 due to a higher portion of ore feed from Pampacancha where the gold grades are meaningfully higher than at Constancia. Milled gold grades decreased compared to the same period in 2024 since additional gold benches were mined as planned during the comparable quarter last year. Copper recoveries of 85% in the fourth quarter of 2025 were higher compared to the third quarter of 2025 but lower compared to the same period in 2024 due to the different proportions of ore feed from stockpiles and pits. Recoveries of gold and silver during the fourth quarter of 2025 were in line with Hudbay's metallurgical models for the ore that was being processed.

Full year ore milled was 5% lower compared to the same period in 2024 mainly due to the aforementioned social issues in the third quarter of 2025. Full year milled copper grades were 8% lower than the same period in 2024 and milled gold grades decreased by 21% due to lower grades in ore feed from the Constancia pit and lower grades in ore feed from stockpiles, both of which made up a higher proportion of ore feed. Recoveries of copper during the year were 84%, representing a decrease of 1% compared to the 2024 period due to lower head grades primarily from stockpiles. Gold and silver recoveries during the year were 69% and 67%, respectively, representing a decrease of 2% and 3%, respectively, due to ore feed from stockpiles.

Production and Sales Performance

The Peru operations produced 25,038 tonnes of copper, 32,865 ounces of gold, 731,017 ounces of silver and 325 tonnes of molybdenum during the fourth quarter of 2025. Production of copper was higher in the fourth quarter of 2025 compared to the third quarter of 2025 and lower compared to the same period in 2024. The increase in copper production compared to the third quarter of 2025 is primarily due to higher ore milled as the third quarter was impacted by a temporary operational interruption due to social unrest. The decrease in copper production compared to the same quarter last year is mainly the result of higher grades from Pampacancha in the prior year. Production of gold and silver was higher than the third quarter of 2025 but lower than the same period in 2024 for the same reasons as the variance in copper production. Production of molybdenum was higher in the fourth quarter of 2025 compared with both comparable periods due to higher recoveries and additional tonnes of ore milled in the molybdenum plant.

Full year production of copper, gold, silver and molybdenum in 2025 was 85,155 tonnes, 74,480 ounces, 2,415,134 ounces, and 1,282 tonnes, respectively, representing a decrease of 14%, 24%, 11% and 3%, respectively, from the comparative 2024 period primarily due to fewer tonnes of ore milled in the current period due to the aforementioned temporary operational interruption in the third quarter of 2025 and lower grades from higher amounts of ore processed from stockpile.

Fourth quarter copper, gold and silver metal sold was higher than the third quarter of 2025 primarily due to the shifting of copper concentrate sales at the end of the third quarter into early in the fourth quarter as a result of ocean swells at the port in late September. While copper concentrate inventory levels normalized at the end of December 2025, the concentrate contained higher levels of precious metals due to a higher portion of Pampacancha production in the second half of the year, resulting in a shift of some precious metals sales from December 2025 to January 2026.

Full year copper metal sold in 2025 was slightly lower than the comparable period but reflected normal levels of unsold copper concentrate inventory at December 31, 2025. Quantities of gold sold during 2025 were lower than 2024 due to lower production levels and the timing of precious metal sales as mentioned above.

18

       

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

         

             

19

Cost Performance

Combined mine, mill and G&A unit operating cost in the fourth quarter of 2025 was $14.51 per tonne, 5% lower than the same period in 2024 primarily from reduced drilling and blasting together with a lower strip ratio during the current quarter. Combined mine, mill and G&A unit operating cost was 11% higher than the third quarter of 2025 due to higher fuel consumption associated with additional tonnes of material moved, higher water management and dewatering costs, and higher milling costs associated with the scheduled semi-annual mill maintenance program, partially offset by additional tonnes milled.

Combined mine, mill and G&A unit operating cost for the full year 2025 was $13.02 per tonne, which was consistent with 2024.

Cash cost¹, net of by-product credits, in the fourth quarter of 2025 was $0.57 per pound of copper, a 43% decrease compared to the same period in 2024 and a 56% decrease compared to the third quarter of 2025. This is a result of higher gold by-product credits, partially offset by higher profit sharing.

Full year 2025 cash cost¹, net of by-product credits was $1.08 per pound of copper, a decrease from $1.18 in the same period of 2024 due to lower treatment and refining charges and higher by-product credits from gold, partially offset by higher profit sharing and lower pounds of copper produced due to the impacts from social unrest in the third quarter.

Sustaining cash cost¹, net of by-product credits, in the fourth quarter of 2025 was $1.53 per pound of copper, an increase of 3% compared to the same period in 2024 as a result of higher sustaining capitalized expenditures. Sustaining cash cost¹, net of by-product credits, per pound of copper decreased by 27% when compared to the third quarter of 2025 due to higher gold by-product credits, partially offset by higher capital spending as a result of timing of sustaining capitalized expenditures, higher community payments and increased lease payments.

On a full year basis, sustaining cash cost¹, net of by-products credits, was $2.02  per pound of copper, higher than the $1.86  per pound of copper for the comparable period in 2024 due to lower grade, higher planned mine maintenance, higher lease payments, and higher payments to communities. This was partially offset by lower treatment and refining charges and higher by-product credits from gold.

20

Peru Guidance Outlook

		Three months ended		Year ended		Guidance
		Dec. 31, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024	Annual 2025	Annual 20262
Contained metal in concentrate produced
Copper	tonnes	25,038	33,988	85,155	99,001	80,000 - 97,000	75,000 - 90,000
Gold	oz	32,865	38,079	74,480	98,226	49,000 - 60,000	15,000 - 20,000
Silver	oz	731,017	969,502	2,415,134	2,708,262	2,475,000 - 3,025,000	1,900,000 - 2,400,000
Molybdenum	tonnes	325	195	1,282	1,323	1,300 - 1,500	900 - 1,100
Cost per pound of copper produced
Cash cost1	$/lb	0.57	1.00	1.08	1.18	1.35 - 1.65	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.

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

Despite the impact from the temporary operational interruption due to social unrest, Hudbay achieved its 2025 production guidance for copper and gold in Peru, with gold production exceeding the top end of the 2025 guidance range. Production of silver and molybdenum fell slightly short of the lower end of guidance. Additionally, cash costs outperformed the low end of the cash cost guidance range.

21

MANITOBA OPERATIONS REVIEW

		Three months ended			Year ended
		Dec. 31, 2025	Sep. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Lalor ore mined	tonnes	353,819	139,006	422,454	1,180,121	1,626,935
Gold	g/tonne	5.51	5.42	4.61	5.35	4.68
Copper	%	0.82	0.67	0.95	0.79	0.85
Zinc	%	2.55	1.93	2.95	2.41	2.84
Silver	g/tonne	29.52	31.57	31.91	30.43	27.14
New Britannia ore milled	tonnes	179,808	92,765	185,592	624,631	715,198
Gold	g/tonne	6.68	6.88	5.99	6.87	6.29
Copper	%	1.08	0.76	1.17	0.95	1.04
Zinc	%	1.30	1.00	1.08	1.09	0.99
Silver	g/tonne	31.17	32.18	33.97	31.75	27.78
Copper concentrate	tonnes	12,091	4,410	12,345	37,175	44,198
Concentrate grade	% Cu	14.17	14.46	16.00	14.24	15.78
Gold recovery1	%	88.6	91.8	90.2	89.8	89.7
Copper recovery	%	88.6	90.0	91.3	89.2	93.6
Silver recovery1	%	77.1	78.5	79.6	79.0	80.9
Contained metal in concentrate produced
Gold	oz	20,846	12,330	22,011	77,463	90,011
Copper	tonnes	1,712	637	1,975	5,294	6,976
Silver	oz	98,205	55,012	119,201	353,970	396,333
Metal in doré produced2
Gold	oz	14,005	6,933	12,747	51,428	56,853
Silver	oz	40,763	25,058	46,431	157,444	165,408
Stall ore milled	tonnes	169,274	43,940	222,004	572,704	893,510
Gold	g/tonne	3.24	3.10	3.36	3.45	3.42
Copper	%	0.69	0.56	0.73	0.67	0.71
Zinc	%	4.32	3.61	4.62	3.90	4.33
Silver	g/tonne	24.97	31.04	29.90	28.31	26.54
Copper concentrate	tonnes	5,802	1,293	7,222	17,657	29,029
Concentrate grade	% Cu	17.31	15.80	19.01	18.94	19.16
Zinc concentrate	tonnes	10,975	1,053	16,187	34,351	64,643
Concentrate grade	% Zn	51.95	52.06	51.80	51.37	51.58
Gold recovery	%	71.3	72.6	69.6	70.1	68.6
Copper recovery	%	86.5	83.4	84.4	86.7	87.4
Zinc recovery	%	78.0	34.6	81.7	79.0	86.2
Silver recovery	%	55.6	50.3	55.1	55.4	56.8
Contained metal in concentrate produced
Gold	oz	12,572	3,178	16,680	44,562	67,361
Copper	tonnes	1,003	205	1,372	3,344	5,560
Zinc	tonnes	5,703	548	8,385	17,646	33,339
Silver	oz	75,525	22,062	117,591	288,784	433,349
1 Gold and silver recovery includes total recovery from concentrate and doré.
2 Doré includes sludge, slag and carbon fines.

22

		Three months ended			Year ended
		Dec. 31, 2025	Sep. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Total contained metal in concentrate and doré produced1
Gold	oz	47,423	22,441	51,438	173,453	214,225
Copper	tonnes	3,326	842	3,347	9,249	12,536
Zinc	tonnes	5,703	548	8,385	17,646	33,339
Silver	oz	214,493	102,132	283,223	800,198	995,090
Payable metal sold in concentrate and doré2
Gold	oz	43,226	23,118	50,239	169,041	212,243
Copper	tonnes	2,024	769	3,321	7,651	11,602
Zinc	tonnes	3,972	3,452	5,261	15,152	25,120
Silver	oz	175,324	112,142	282,158	729,314	956,460
Unit Operating Costs3
Lalor	C$/tonne	154.73	157.38	141.13	150.86	142.59
New Britannia	C$/tonne	76.85	61.54	69.09	69.62	70.99
Stall	C$/tonne	51.82	57.90	46.34	46.26	43.02
Combined unit operating costs4,5,6	C$/tonne	248	258	233	236	226
Cost per ounce of gold produced
Cash cost6,7	$/oz	705	379	607	549	606
Sustaining cash cost6	$/oz	1,110	762	908	875	868

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 overhead costs of $16.0 million or C$163 per tonne during the three months ended September 30, 2025 and $19.2 million or C$22 per tonne during the year ended December 31, 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 overhead costs of $16.0 million or $713 per ounce of gold produced during the three months ended September 30, 2025 and $19.2 million or $111 per ounce during the year-ended December 31, 2025.

Overview

Manitoba operations normalized in the fourth quarter of 2025 following the significant wildfire disruptions in the second and third quarters of 2025 allowing the Company to achieve quarterly production numbers similar to what were demonstrated earlier in the year. The Manitoba operations produced 47,423 ounces of gold, 3,326 tonnes of copper, 5,703 tonnes of zinc and 214,493 ounces of silver in the fourth quarter of 2025. Production of all metals in the fourth quarter was higher than the third quarter of 2025, which was negatively impacted by mandatory wildfire evacuations.

Achievements in the fourth quarter included improved metal recovery rates, advancements in Hudbay's exploration programs in Flin Flon and Snow Lake, including the prospective copper-gold-zinc Talbot satellite deposit, and the graduation of the second cohort from the mining fundamentals training program focused on providing local and Indigenous communities with valuable mining skills. In 2025, Hudbay signed exploration agreements with the Mosakahiken Cree Nation and the Kiciwapa Cree Nation and achieved record throughput at the New Britannia mill in December. All of this was underpinned by a continued focus on safety with a 15% reduction in total recordable injury frequency achieved in 2025.

The Lalor mine focused on stabilizing production in the fourth quarter after the resumption of operations following the mandatory wildfire evacuations. Lalor averaged over 4,200 tonnes per operating day in the fourth quarter of 2025, strategically prioritizing mining from gold zones to ensure prioritized feed for the New Britannia mill. This was accomplished through a focus on mine planning and the maintenance recovery plan to get Lalor's underground mobile fleet back to pre-wildfire availability numbers.

23

The 1901 deposit delivered 6,600 tonnes of development ore in 2025 as the project progresses towards full production in 2027. During the year, haulage and exploration drifts were prioritized as infrastructure was being put in place. In 2026, activities at 1901 will prioritize exploration and definition drilling, orebody access, and establishing critical infrastructure ahead of full production in late 2027.

The New Britannia mill processed approximately 2,300 tonnes per day in December, achieving a new monthly throughput record of 71,504 tonnes. This achievement is aligned with the strategy to prioritize gold ore production and resulted from continuous improvement efforts focused on unlocking capacity at designed or improved recovery rates. Despite the wildfire challenges in 2025, New Britannia achieved its second highest annual throughput of 624,631 tonnes as Lalor delivered production from the gold zones, ensuring a consistent feed to the mill. While Lalor and New Britannia focused on gold production, the team at the Stall mill focused on process optimization and enhanced gold recovery initiatives targeting over 70% gold recovery from the base metal ore stream.

Mining Activities

Total ore mined in Manitoba in the fourth quarter of 2025 was impacted by approximately a week long winter storm power outage in October and the subsequent ramp up to normal operations. In the fourth quarter of 2025, gold grades increased by 20% compared to the same period in 2024 and 2% compared to the third quarter of 2025 due to mining techniques resulting in improved ore quality and prioritizing mining gold zones at Lalor.

Total ore mined at Hudbay's Manitoba operations during the year ended December 31, 2025 was 27% lower than the same period in 2024, mainly as a result of the aforementioned mandatory wildfire evacuations and weather-related power outage in 2025. Full year gold and silver grades mined at Lalor were 14% and 12% higher, respectively, compared with the same period in 2024 due to mining sequence and prioritizing mining gold zones in an effort to keep New Britannia fully utilized. Full year copper and zinc grades mined were 7% and 15% lower than the same period in 2024.

Milling Activities

Consistent with Hudbay's strategy of allocating more Lalor ore feed to New Britannia to maximize gold recoveries, adjusting for days interrupted by unplanned down time in October due to a winter storm power outage, New Britannia mill operated for 79.5 days during the quarter at an average throughput of approximately 2,260 tonnes per operating day. Gold recovery in the fourth quarter of 2025 was 89% reflecting a slight decrease compared to the same period in 2024 and the third quarter of 2025 due to ore blend resulting in slightly lower gold grades processed at the mill during the quarter. Full year 2025 total ore milled at New Britannia was 13% lower than 2024, largely driven by the impacts of unexpected downtime from an approximate week long power outage in October and over two months of mandatory wildfire evacuation shutdowns. Full year gold recoveries were consistent with the prior year and milled gold grades were 9% higher compared to 2024.

The Stall mill processed significantly less ore in 2025 compared to the same periods in 2024, which is aligned with the Company's strategy of allocating more Lalor ore feed to New Britannia as noted above. The Stall mill achieved gold recoveries of 71% in the fourth quarter of 2025, reflecting benefits from process optimization and enhanced gold recovery initiatives. Full year gold recovery was 2% higher due to higher gold grades and improvements from the installed gravity concentrator.

Production and Sales Performance

The Manitoba operations produced 47,423 ounces of gold, 3,326 tonnes of copper, 5,703 tonnes of zinc and 214,493 ounces of silver in the fourth quarter of 2025. Production of gold, copper, silver, and zinc decreased by 8%, 1%, 24% and 32%, respectively, compared to the fourth quarter of 2024, due to an eight-day weather-related power outage in October. Production of all metals in the fourth quarter was higher than the third quarter of 2025, which was negatively impacted by mandatory wildfire evacuations.

Full year production of all metals was lower than 2024 as a result of the same factors explained above, including over two months of production deferrals due to mandatory wildfire evacuations and associated ramp-up activities.

Manitoba sales volumes in the fourth quarter of 2025 reflect a rebuild of inventory levels as operations normalized after the wildfires in the second and third quarters of 2025.

24

   

Cost Performance

Combined mine, mill and G&A unit operating costs in the fourth quarter and full year 2025 were C$248 per tonne and C$236 per tonne, respectively, relatively consistent with all comparable periods after adjusting for the allocation of fixed overheads in periods with lower capacity utilization due to the wildfires.

Cash cost⁴, net of by-product credits, in the fourth quarter of 2025 was $705  per ounce of gold, higher compared to the same period in 2024 primarily as a result of higher G&A costs due to profit sharing and lower gold production in the quarter. Compared to the third quarter of 2025, cash costs increased primarily due to higher overall costs and the impact of the recovery of secondary gold products in the third quarter as a result of mill tank clean-outs, partially offset by higher production.

Sustaining cash cost⁴, net of by-product credits, in the fourth quarter of 2025 was $1,110 per ounce of gold, higher than the same period in 2024 primarily as a result of lower gold production and higher capital expenditures in the quarter and higher than the third quarter of 2025 primarily due to the same factors affecting cash costs and elevated sustaining capital expenditures.

Cash cost⁴, net of by-product credits, for the full year 2025 was $549 per ounce of gold, a 9% decrease compared to the same period in 2024 primarily due to lower operating costs partially offset by lower gold production and higher profit sharing. Sustaining cash cost⁴, net of by-product credits, for the full year 2025 was $875 per ounce of gold, a slight increase from the same period in 2024 primarily due to the same factors affecting cash cost noted above with slightly higher capital expenditures.

25

Manitoba Guidance Outlook

		Three months ended		Year ended		Guidance
		Dec. 31, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024	Annual 2025	Annual 20266
Total contained metal in concentrate and doré produced1
Gold2	oz	47,423	51,438	173,453	214,225	180,000 - 220,000	180,000 - 220,000
Copper	tonnes	3,326	3,347	9,249	12,536	9,000 - 11,000	10,000 - 13,000
Zinc	tonnes	5,703	8,385	17,646	33,339	21,000 - 27,000	16,000 - 21,000
Silver3	oz	214,493	283,223	800,198	995,090	800,000 - 1,000,000	800,000 - 1,000,000
Cost per ounce of gold produced
Cash cost4,5	$/oz	705	607	549	606	650 - 850	500 - 800

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

² Gold 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 $19.2 million or $111 per ounce of overhead costs incurred during temporary suspension during the year ended December 31, 2025.

⁶ Refer to the "Outlook" section of this MD&A for more information.

Full year production in Manitoba in 2025 successfully achieved guidance for copper and silver. While the operations were tracking within all guidance ranges earlier in the year, full year gold and zinc production fell below the low end of the respective ranges. This shortfall was primarily driven by the unprecedented wildfire disruptions, the winter power outage and the subsequent ramp-up period required to restore full operational cadence.

Despite these production headwinds, cash cost for the full year 2025 outperformed the low end of the guidance range. This strong cost performance was supported by the strategic decision to prioritize high-margin gold production over by-product zinc production.

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BRITISH COLUMBIA OPERATIONS REVIEW

		Three months ended5			Year ended5
		Dec. 31, 2025	Sep. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Ore mined1	tonnes	2,395,166	1,815,689	2,374,044	9,368,918	11,360,125
Strip ratio2		7.18	8.84	7.36	7.46	5.98
Ore milled	tonnes	2,268,405	3,087,443	2,880,927	11,016,842	12,656,679
Copper	%	0.26	0.22	0.26	0.27	0.25
Gold	g/tonne	0.09	0.08	0.09	0.09	0.08
Silver	g/tonne	1.10	0.78	0.92	1.02	0.96
Copper concentrate	tonnes	19,966	21,560	25,554	100,958	113,528
Concentrate grade	% Cu	23.6	24.4	23.2	23.6	23.3
Copper recovery	%	78.4	76.6	79.5	78.6	82.4
Gold recovery	%	63.3	59.2	55.8	63.6	60.5
Silver recovery	%	71.4	65.5	69.0	69.7	71.8
Combined unit operating costs3,4	C$/tonne	39.80	25.02	23.22	28.12	20.39

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

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

³ Reflects 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			Year ended2
		Dec. 31, 2025	Sep. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Contained metal in concentrate produced
Copper	tonnes	4,705	5,249	5,927	23,784	26,406
Gold	oz	4,010	4,760	4,644	20,001	19,789
Silver	oz	57,475	50,816	58,933	252,811	280,499
Payable metal sold
Copper	tonnes	3,747	5,742	5,831	22,445	25,354
Gold	oz	3,324	5,363	5,036	19,465	19,735
Silver	oz	45,298	48,061	43,747	221,406	249,536
Cost per pound of copper produced
Cash cost1	$/lb	4.82	3.21	3.00	3.06	2.74
Sustaining cash cost1	$/lb	8.87	7.43	5.76	6.12	5.29

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%.

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Overview

Throughout 2025, Hudbay focused on advancing its multi-year optimization plan at Copper Mountain, centered on ramping up mining activities and implementing standardized operating practices. A key pillar of this ramp-up was the successful onboarding of over 240 new employees, significantly expanding the Company's in-house team of skilled equipment operators. This strategic investment has led to a meaningful reduction in reliance on temporary contractor labour, ensuring long-term operational stability.

Mining operations have focused on a three-year accelerated stripping program to unlock higher grade ore starting in 2027. In the fourth quarter of 2025, this initiative was bolstered by an optimized mining sequence and enhanced maintenance, driving mining rates to a targeted 300,000 tonnes per day in December. To sustain this momentum, a new production loader was commissioned in January 2026, and a new shovel is currently scheduled for deployment in March 2026.

In the mill, the permanent feeder configuration for the second SAG mill was commissioned late in the fourth quarter, and the temporary conveyor system located on the ore live pile was removed in January 2026. With the completion of the permanent feeder for the second SAG mill project in December, the second SAG mill continued to demonstrate positive contributions to overall throughput in the fourth quarter. While the primary SAG mill continues to operate under a reduced load, it is being rigorously monitored ahead of a feed end head replacement in mid-2026. Total mill throughput is expected to ramp up to 50,000 tonnes per day in the second half of 2026. In the first half of 2026, optimization efforts will focus on automated grinding media loading, installing a mill slicer on the second SAG, implementing advanced process control on grinding and flotation, and a pebble circuit trial to improve overall throughput capacity.

Following the quarter end, the New Ingerbelle project reached a major milestone with the provincial regulators referring the permit application to Statutory Decision Makers on January 16, 2026. New Ingerbelle permits are expected to be received in the first quarter of 2026, and the project is expected to further extend mine life at Copper Mountain. Furthermore, Hudbay finalized refreshed Participation Agreements with the Upper and Lower Similkameen Indian Bands in February 2026, reinforcing the Company's commitment to strong Indigenous partnerships.

Mining Activities

Total ore mined at Copper Mountain in the fourth quarter of 2025 was 2.4 million tonnes, an increase of 1% compared to the fourth quarter of 2024. During this period, the mining team utilized planned ore stockpiles for mill feed and higher grade ore from an advanced phase in the main pit, allowing the operation to prioritize waste stripping activities to expose higher-value mining fronts in the future. On a sequential basis, total ore mined increased by 32% compared to the third quarter of 2025. The significant improvement reflects the optimization of the mining sequence, which improved bench configurations and eliminated phase interference, along with enhanced mobile equipment maintenance protocols leading to more consistent availability.

For the full year 2025, total ore mined was 18% lower than the same period in 2024. This year-over-year decrease was a deliberate operational decision to align mine output with the downstream mill constraints and to prioritize the long-term stripping requirements of the life of mine plan.

Milling Activities

The mill processed 2.3 million tonnes of ore during the fourth quarter of 2025, a decrease of 21% compared to the fourth quarter of 2024 and 27% compared to the third quarter of 2025. Throughput during the period was primarily impacted by unplanned maintenance on the primary SAG mill to address the localized damage to the feed end head. Operations were further constrained by elevated clay content in the ore feed and the planned decrease of the ore feed pile to accommodate the construction and tie-ins for the second SAG expansion project. To mitigate these challenges and build long-term reliability, the team implemented several initiatives in 2025, including crushing circuit chute modifications, the installation of advanced grinding control instrumentation, and a redesigned SAG liner package.

Despite throughput constraints, milled copper grades during the fourth quarter of 2025 were consistent with the prior year and 18% higher than the third quarter of 2025, driven by higher grades in ore mined. Copper recoveries improved to 78% in the fourth quarter of 2025, supported by higher-grade feed and ongoing flotation circuit refinements. Gold recoveries saw a significant 13% increase over the same period in 2024, reaching 63% as a result of general improvements in the flotation system.

Full year 2025 milled copper and gold grades were higher than the same period in 2024 as accelerated stripping efforts successfully enabled a higher-grade mining sequence. While full year copper recoveries of 79% were slightly lower than the previous year due to the characteristics of the ore processed, operational strategy improvements including optimized reagent selection and dosing modifications are currently in progress to stabilize performance.

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The mill remains on track to achieve its permitted capacity of 50,000 tonnes per day in the second half of 2026 with the permanent second SAG feeder configuration commissioned in December 2025, the removal of live-pile restrictions in January, the proactive primary SAG feed end head replacement and rollout of automated grinding media loading and advanced process controls.

Production and Sales Performance

During the fourth quarter of 2025, the British Columbia operations produced 4,705 tonnes of copper, 4,010 ounces of gold and 57,475 ounces of silver. Metal production was lower compared to the fourth quarter of 2024 and the third quarter of 2025, primarily reflecting the aforementioned reduced mill throughput caused by the unplanned maintenance on the primary SAG.

For the full year 2025, production of copper, gold and silver was 23,784 tonnes, 20,001 ounces and 252,811 ounces, respectively. Annual copper and silver production were lower year-over-year, reflecting lower mill availability in the fourth quarter of 2025 and the strategic focus on waste stripping during the period. Despite the throughput constraints encountered in the latter half of the year, annual gold production increased by 1% compared to 2024. This growth was driven by higher head grades and improved gold recoveries resulting from the flotation circuit optimizations implemented throughout the year.

Sales volumes for copper, gold, and silver in the fourth quarter of 2025 were lower than the levels seen in both the prior year and the third quarter of 2025. This decrease in quantities sold was directly correlated with the lower production volumes resulting from the reduced throughput in the primary SAG mill and temporary depletion of the crushed ore live pile.

       

*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%.

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Cost Performance

Combined mine, mill and G&A unit operating costs in the fourth quarter of 2025 were C$39.80 per tonne milled. This increase relative to both the fourth quarter of 2024 and the third quarter of 2025 was primarily due to lower milled throughput and the non-recurring costs associated with the unplanned primary SAG mill maintenance. Additionally, mining and administrative costs were higher as the operations transitioned towards an expanded in-house workforce and continued to advance the accelerated stripping program.

For the full year 2025, unit operating costs were C$28.12 per tonne, compared to C$20.39 per tonne milled in the same period of 2024, reflecting the lower annual throughput and the strategic ramp-up of site-wide optimization initiatives.

Cash cost¹ and sustaining cash cost¹, net of by-product credits, were $4.82 and $8.87, respectively,  per pound of copper, in the fourth quarter of 2025. Cash cost was higher than the fourth quarter of 2024 largely driven by the ramp up of mining activities in fourth quarter of 2025 to advance the accelerated stripping program, partially offset by higher by-product credits due to strong metal prices compared to the same period in 2024. Cash cost was higher than third quarter of 2025, largely due to the same reasons and lower by-product credits as a result of the primary SAG mill maintenance early in the fourth quarter. Sustaining cash costs were higher than the fourth quarter of 2024 mainly as a result of the increases in cash costs. Sustaining cash costs were higher than the third quarter of 2025 due to higher cash costs, offset by lower capitalized stripping costs.

Cash cost¹ and sustaining cash cost¹, net of by-product credits, were $3.06 and $6.12, respectively, per pound of copper, for the full year 2025 and were higher than the cash cost and sustaining cash cost in 2024 due to higher overall costs, capital and lower production.

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British Columbia Guidance Outlook

		Three months ended2		Year ended2		Guidance
		Dec. 31, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024	Annual 2025	Annual 20263
Contained metal in concentrate produced
Copper	tonnes	4,705	5,927	23,784	26,406	28,000 - 41,000	25,000 - 35,000
Gold	oz	4,010	4,644	20,001	19,789	18,500 - 28,000	22,000 - 32,000
Silver	oz	57,475	58,933	252,811	280,499	245,000 - 365,000	200,000 - 290,000
Cost per pound of copper produced
Cash cost1	$/lb	4.82	3.00	3.06	2.74	2.45 - 3.45	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%.

³ Refer to the "Outlook" section of this MD&A for more information.

For the full year 2025, British Columbia operations achieved its production guidance for gold and silver, while copper production fell below the low end of the 2025 guidance range. Copper production was primarily impacted by the unplanned maintenance at the primary SAG mill in the fourth quarter and a higher than anticipated proportion of lower grade stockpile ore processed throughout the year.

Despite the throughput and copper production headwinds, the business unit demonstrated strong cost discipline and full year 2025 cash costs achieved the guidance range.

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OUTLOOK

This outlook includes forward-looking information about Hudbay's operations and financial expectations based on its expectations and outlook as of February 19, 2026.

This outlook, including expected results and targets, is subject to various risks, uncertainties and assumptions, which may impact future performance and Hudbay's achievement of the results and targets discussed in this section. For additional information on forward-looking information, refer to the "Forward-Looking Information" section of this MD&A. Hudbay may update its outlook depending on changes in metals prices and other factors, as per its "Commodity Markets" and "Sensitivity Analysis" discussions below. In addition to this section, refer to the "Operations Review", "Financial Review" and "Liquidity and Capital Resources" sections for additional details on Hudbay's outlook for 2026.

Material Assumptions

Hudbay's annual production and operating cost guidance, along with its annual capital and exploration expenditure forecasts are discussed in detail below.

Production Guidance

Contained Metal in Concentrate and Doré1		2026 Guidance	Year ended Dec. 31, 2025	2025 Guidance
Peru
Copper	tonnes	75,000 - 90,000	85,155	80,000 - 97,000
Gold	oz	15,000 - 20,000	74,480	49,000 - 60,000
Silver	oz	1,900,000 - 2,400,000	2,415,134	2,475,000 - 3,025,000
Molybdenum	tonnes	900 - 1,100	1,282	1,300 - 1,500
Manitoba
Gold2	oz	180,000 - 220,000	173,453	180,000 - 220,000
Zinc	tonnes	16,000 - 21,000	17,646	21,000 - 27,000
Copper	tonnes	10,000 - 13,000	9,249	9,000 - 11,000
Silver2	oz	800,000 - 1,000,000	800,198	800,000 - 1,000,000
British Columbia
Copper	tonnes	25,000 - 35,000	23,784	28,000 - 41,000
Gold	oz	22,000 - 32,000	20,001	18,500 - 28,000
Silver	oz	200,000 - 290,000	252,811	245,000 - 365,000
Total
Copper	tonnes	110,000 - 138,000	118,188	117,000 - 149,000
Gold2	oz	217,000 - 272,000	267,934	247,500 - 308,000
Zinc	tonnes	16,000 - 21,000	17,646	21,000 - 27,000
Silver2	oz	2,900,000 - 3,690,000	3,468,143	3,520,000 - 4,390,000
Molybdenum	tonnes	900 - 1,100	1,282	1,300 - 1,500

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

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

On a consolidated basis, Hudbay successfully achieved 2025 production guidance for its primary metals. 2025 represents the 11th consecutive year in which Hudbay achieved its annual consolidated copper production guidance, since Constancia declared commercial production, and the 5th consecutive year achieving its annual consolidated gold production guidance, since establishing standalone gold production guidance². Peru achieved the guidance range for copper and exceeded the top end of the gold production guidance range despite the impact from the temporary operational interruption due to social unrest. Peru production of silver and molybdenum fell slightly below the low end of guidance. Manitoba was previously tracking within the 2025 guidance ranges despite the wildfire impacts, but as a result of the weather-related power outage in October and the subsequent ramp-up period required to restore full operational cadence, gold and zinc production fell below the low end of their respective ranges. However, Manitoba achieved guidance for copper and silver production despite these interruptions. British Columbia copper production fell below the low end of the guidance range as a result of the unplanned maintenance at the primary SAG mill in the fourth quarter and a higher than anticipated proportion of lower grade stockpile ore processed through the year. However, gold and silver production in British Columbia achieved guidance ranges despite the lower mill availability in the fourth quarter.

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In 2026, consolidated copper production is expected to increase by 5% to 124,000 tonnes¹. This is driven by higher expected production in British Columbia as a result of mill throughput ramping-up to the targeted 50,000 tonnes per day in the second half of 2026, partially offset by the depletion of the high-grade Pampacancha satellite deposit in December 2025. Consolidated gold production in 2026 is expected to decrease by 9% to 244,500 ounces¹ as a result of the depletion of Pampacancha, but unstreamed gold production is expected to increase in 2026 with higher gold production in Manitoba as operations normalize following unprecedented wildfires in 2025 and continue to achieve strong performance from the New Britannia mill.

In Peru, 2026 copper production is expected to be 82,500 tonnes¹, a slight decrease of 3% from 2025 due to the depletion of Pampacancha, which has been largely offset by higher mill throughput and operating efficiencies. Peru expects to install two pebble crushers to increase mill throughput in the second half of 2026, in addition to implementing other mill optimization initiatives. Gold production is expected to decline to 17,500 ounces¹, lower than 2025 levels as Hudbay optimized the mine plan in 2025 during a period of social unrest by prioritizing Pampacancha mining activities and supplementing mill ore feed from low-grade stockpiles. These short-term mine plan changes resulted in reduced stripping activities in 2025, which is expected to result in some grade re-sequencing in 2026 and higher production in 2027 and 2028. Peru's 2026 production guidance reflects regularly scheduled semi-annual mill maintenance shutdowns at Constancia during the second and fourth quarters of 2026.

In Manitoba, 2026 gold production is expected to be 200,000 ounces¹, an increase of 15% from 2025, reflecting normalized operations after unprecedented wildfires in 2025, continued strong mill throughput at New Britannia and strong gold grades at Lalor. New Britannia mill throughput is expected to continue to exceed expectations and operate above 2,200 tonnes per day in 2026, far exceeding its original design capacity of 1,500 tonnes per day. The production guidance anticipates Lalor operating at approximately 4,500 tonnes per day, supplemented by 35,000 tonnes of ore feed from the 1901 deposit in 2026. Zinc production for 2026 is expected to be 18,500 tonnes¹, representing a 5% increase from 2025, driven by higher production from the 1901 deposit.

In British Columbia, 2026 copper production is expected to be 30,000 tonnes¹, representing a 26% increase from 2025, driven by the completion of the third ball mill to second SAG mill conversion in late 2025. As previously disclosed, Hudbay now expects mill throughput to achieve the targeted 50,000 tonnes per day in the second half of 2026 as opposed to early 2026 due to the impacts of reduced throughput at the primary SAG mill. Installation of the replacement feed end head at the primary SAG mill is scheduled for early in the third quarter of 2026.

Hudbay expects to release an updated three-year production outlook together with its annual mineral reserve and resource update in March 2026.

33

Cash Cost Guidance

Copper remains the primary revenue contributor on a consolidated basis, and therefore, consolidated cost guidance has been presented as cash cost³ per pound of copper, net of by-product credits. The Company has also provided cash cost guidance for each of Hudbay's operations based on their respective primary metal contributors.

Cash cost 1		2026 Guidance	Year ended Dec. 31, 2025	2025 Guidance
Peru cash cost per pound of copper2	$/lb	1.70 - 2.10	1.08	1.35 - 1.65
Manitoba cash cost per ounce of gold3	$/oz	500 - 800	549	650 - 850
British Columbia cash cost per pound of copper4	$/lb	1.50 - 2.50	3.06	2.45 - 3.45
Consolidated cash cost per pound of copper	$/lb	(0.30) - (0.10)	(0.22)	0.15 - 0.35 (original 0.80 - 1.00)6
Consolidated sustaining cash cost per pound of copper5	$/lb	1.70 - 2.10	1.30	1.85 - 2.25 (original 2.25 - 2.65)6

¹ Cash cost and sustaining cash cost, net of by-product credits, per pound of copper produced and cash costs, net of by-product credits, per ounce of gold produced 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 Peru cash cost, net of by-product credits, per pound of copper produced assumes by-product credits are calculated using the gold and silver deferred revenue drawdown rates for the streamed ounces in Peru in effect on December 31, 2025 and the following commodity prices for unstreamed production in 2026: $3,850 per ounce gold and $20.00 per pound molybdenum.

³ Manitoba cash cost, net of by-product credits, per ounce of gold assumes by-product credits are calculated using the following commodity prices for 2026: $4.75 per pound copper, $42.00 per ounce silver, $1.30 per pound zinc and an exchange rate of 1.37 C$/US$.

⁴ British Columbia cash cost, net of by-product credits, per pound of copper assumes by-product credits are calculated using the following commodity price assumptions for 2026: $3,850 per ounce gold, $42.00 per ounce silver and an exchange rate of 1.37 C$/US$.

⁵ Includes cash sustaining capital expenditures, including payments on capitalized leases and equipment financing, payments on certain long-term community agreements, royalties as well as accretion and amortization for expected decommissioning activities for producing assets.

⁶ Improved full year 2025 consolidated copper cash cost guidance range to $0.15 to $0.35 per pound from prior guidance of $0.65 to $0.85 per pound and the original guidance range of $0.80 to $1.00 per pound. Improved full year 2025 consolidated sustaining copper cash cost guidance range to $1.85 to $2.25 per pound from the original guidance range of $2.25 to $2.65 per pound.

Consolidated cash cost¹ in 2026 is expected to remain at historical lows and be within $(0.30) to $(0.10) per pound of copper, net of by-product credits, benefiting from higher gold production and the Company's continued focus on maintaining strong cost control across the business, driving industry-leading margins. Sustaining cash cost¹ in 2026 is expected to be within $1.70 to $2.10 per pound of copper, net of by-product credits, benefitting from higher copper production and higher by-product credits,  offset by higher sustaining capital expenditures, including substantial capital deferrals from 2025.

Copper cash cost in Peru is expected to be between $1.70 to $2.10 per pound in 2026, reflecting steady unit operating cost performance, offset by lower copper production and by-product credits compared to 2025 from the depletion of Pampacancha. 2026 cash costs are positively affected by lower treatment and refining charges and a new power contract lowering electricity rates.

Gold cash cost in Manitoba is expected to be between $500 and $800 per ounce, an increase compared to 2025, but remaining at industry-low levels driving strong margins compared to current gold prices.

Copper cash cost in British Columbia is expected to be between $1.50 and $2.50 per pound in 2026, a decrease compared to 2025 due to higher copper production, higher by-product credits from higher gold production, and higher capitalized stripping related to continued accelerated stripping activities as part of the three-year stabilization and optimization plan at Copper Mountain.

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Capital Expenditure Guidance

Capital Expenditures1,2 (in $ millions)	2026 Guidance	Year ended Dec. 31, 2025	2025 Guidance
Sustaining capital 3
Peru4	140.0	137.0	170.0
Manitoba	105.0	45.7	60.0
British Columbia - sustaining capital	60.0	33.7	50.0
British Columbia - capitalized stripping	130.0	97.7	85.0
Total sustaining capital	435.0	314.1	365.0
Growth capital
Peru	40.0	4.7	25.0
Manitoba	15.0	7.4	15.0
British Columbia	85.0	64.2	75.0
Total growth capital - excl. Copper World JV	140.0	76.3	115.0
Capitalized exploration	25.0	15.6	10.0
Copper World joint venture5	135.0	71.5	110.0

¹ Excludes capitalized costs not considered to be sustaining or growth capital expenditures.

² 2026 Canadian capital expenditures guidance is converted into U.S. dollars using an exchange rate of 1.37 C$/US$ (2025 - 1.35 C$/US$).

³ Sustaining capital guidance excludes right-of-use lease and equipment financing additions, community agreements and non-cash capitalized stripping.

⁴ Includes capitalized stripping and development costs.

⁵ Copper World growth capital shown on a 100% basis. With the announcement of the JV Transaction in August 2025, Hudbay expects to accelerate detailed engineering, long lead items and other de-risking activities by advancing $20 million in growth capital expenditures to 2025 from future years, updating total 2025 Copper World joint venture growth spending guidance to $110 million compared to the original 2025 guidance of $90 million. Approximately $35 million of the 2025 updated growth spending was deferred to 2026.

Total sustaining capital in 2025 was approximately $50 million lower than guidance due to approximately $10 million lower capitalized stripping in Peru from the impact of social unrest, approximately $10 million lower capitalized development at Lalor due to the impact of wildfires, and approximately $38 million in sustaining capital deferrals to 2026, partially offset by $13 million higher capitalized stripping in British Columbia. Excluding Copper World project costs, growth capital in 2025 was approximately $39 million lower than guidance primarily due to timing of expenditure and a majority is expected to be deferred to 2026. Copper World growth spending in 2025 was approximately $39 million lower than guidance due to timing of expenditure, a majority of which will be deferred to 2026.

2026 total capital spending includes approximately $96 million of capital deferrals from 2025, higher growth capital spending as Hudbay reinvests in several high-return growth projects and one-time sustaining capital expenditures at the operations as discussed below.

Peru 2026 sustaining capital expenditures are expected to be maintained at $140 million, which includes $20 million of sustaining capital deferrals to 2026 and $18 million in one-time heavy civil works projects, offset by lower spending on tailings dam raises. Peru 2026 growth capital expenditures of $40 million relate primarily to the installation of two pebble crushers to increase mill throughput starting in the second half of 2026 and includes $13 million in capital deferrals from 2025.

Manitoba 2026 sustaining capital expenditures are expected to temporarily increase to $105 million in 2026 primarily as a result of $20 million in one-time expenditures related to a project at New Britannia to lower nitrogen levels, $12 million for an accelerated one-year construction schedule for a dam raise at the Anderson tailings facility and $5 million in capital deferrals from 2025. Underground capitalized development at Lalor is expected to return to normal levels after reduced levels in 2025 from the wildfires. Manitoba growth capital expenditures are expected to be $15 million in 2026 and relate primarily to the development of exploration platforms and haulage drifts at the 1901 deposit. Manitoba spending guidance excludes approximately $15 million of annual care and maintenance costs related to the Flin Flon facilities in 2026, which are expected to be recorded as other operating expenses.

British Columbia 2026 sustaining capital expenditures are expected to increase to $60 million in 2026 primarily as a result of $5 million in one-time expenditures related to the replacement of the feed end head at the primary SAG and $13 million in capital deferrals from 2025. In addition, Hudbay expects to incur approximately $130 million of capitalized stripping costs in 2026 related to continued accelerated stripping activities as the final year of the three-year stabilization and optimization plan at Copper Mountain. To ensure positive cash flows in British Columbia as the Company executes the last year of accelerated stripping activities, during the first quarter of 2026, the Company entered into copper forward sales contracts at an average price of $6.02 per pound and a zero-cost copper collar program at an average floor price of $5.75 per pound and cap price of $6.34 per pound on approximately 20% of 2026 copper production in British Columbia. British Columbia growth capital expenditures are expected to increase to $85 million in 2026 and includes $10 million in capital deferrals from 2025. Growth capital spending primarily relates to early works and infrastructure development for the New Ingerbelle expansion project.

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Copper World joint venture 2026 growth capital guidance of $135 million primarily relates to feasibility study costs and continued de-risking until a Copper World project sanctioning decision, including approximately $60 million for accelerated long lead items and de-risking activities and $35 million of capital deferrals from 2025 and excludes post-project sanction construction costs which will be updated at the time of project sanction.

Exploration Guidance

Exploration Expenditures (in $ millions)		Year ended
	2026 Guidance	Dec. 31, 2025	2025 Guidance
Peru1	15.0	15.9	19.0
Manitoba2	50.0	33.0	30.0
British Columbia	20.0	7.7	1.0
Total exploration expenditures	85.0	56.6	50.0
Capitalized spending	(25.0)	(15.6)	(10.0)
Total exploration expense	60.0	41.0	40.0

¹ Peru exploration expenditures exclude approximately $6 million of non-cash amortization of community agreements for exploration properties for 2026 (2025 - $5 million).

² Manitoba exploration partially funded by approximately $20 million in Canadian Exploration Expense flow-through financing proceeds for 2026 (2025 - $10 million).

Total 2026 exploration expenses are expected to increase to $60 million from $41 million in 2025 as Hudbay continues to execute a multi-year extensive geophysics and drilling program in Snow Lake to extend mine life and explore for new discoveries and focus on the conversion of high value inferred resources at New Ingerbelle, as described below.

In Manitoba, 2026 exploration activities will focus on completing the largest geophysics program in the Company's history, including 800 kilometres of ground electromagnetic surveys and an extensive airborne geophysics survey. The Company plans to complete underground and surface drilling at Lalor to continue expanding its mineral resource and reserve estimates and underground drilling at 1901 from the new exploration drift. In addition, Hudbay plans to continue drilling activities at several regional targets in 2026, including the Talbot deposit and at other regional prospective areas, following up on encouraging results in 2025. A portion of the 2026 Manitoba exploration program will be funded by approximately $20 million in proceeds from a critical minerals premium flow-through financing completed in late 2025.

In British Columbia, 2026 exploration activities will focus on the conversion of high value inferred resources at New Ingerbelle to potentially extend mine life at Copper Mountain.

In Peru, 2026 exploration activities will continue to focus on final permitting and drill preparation for the Maria Reyna and Caballito properties near Constancia.

¹ Calculated using the midpoint of the guidance range

² In 2020, Hudbay's consolidated copper production guidance range was revised during the year due to the impact of COVID-19 at the operations. Hudbay's copper production was within the revised guidance ranges. Prior to 2021, Hudbay provided guidance on a precious metal equivalent instead of gold as a standalone metal.

³ Cash cost and sustaining cash cost, net of by-product credits, per pound of copper produced and cash costs, net of by-product credits, per ounce of gold produced 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.

36

Commodity Markets

Hudbay's 2026 operational and financial performance will be influenced by a variety of factors including production volumes, metal prices and input costs. The general performance of the Chinese, North American and global economies and intervention into markets by world government will influence the demand for copper, zinc and the prices the Company receives. Meanwhile interest rates, inflation, the performance of financial markets, the amount of central bank and investor gold purchases and the level of geopolitical uncertainty will drive the price Hudbay receives for its unstreamed gold and silver.

The realized prices the Company achieves in the commodity markets significantly affect Hudbay's financial performance. The Company's general expectations regarding metals prices and foreign exchange rates are included below and in the "Sensitivity Analysis" section of this MD&A.

Management has developed the following market analysis from various information sources including analyst and industry experts and Hudbay's own market intelligence.

Copper

In 2025, the London Metal Exchange ("LME") Cash copper price began the year at $3.94 per pound and rapidly ran up to $4.53 per pound in late March just before the Trump administration announced "Liberation Day" import tariffs on most nations on April 2, 2025.  After a short-lived dip in early April, the price spent the second and third quarters of the year trading between $4.17 and $4.68 per pound before breaking out to the upside in the fourth quarter due to significant supply disruptions at a number of major mines. The LME price closed the year at an annual high of $5.67 per pound and averaged $4.51 per pound for the full year. Concerns that the Section 232 copper review initiated by the US federal government would result in a 50% tariff on USA imports of copper cathode, dominated the market in the first half of 2025.  As a result, substantial quantities of copper cathode were imported into the USA and stored in warehouses ahead of the expected mid-year tariff implementation.  This artificial demand for copper not only buoyed LME prices and drew down LME stocks but also resulted in a substantial price arbitrage in favour of COMEX over the LME which peaked at a 28% premium in July. Only July 29th, when the USA government announced that there would be no tariffs placed on imports of copper cathode, the arbitrage quickly evaporated. 

2026 had already seen the LME cash price breach the $6.00 per pound price for the first time in history, largely on the basis of critical minerals based supply chain concerns in all regions of the world and the announced intention of the USA to begin actively stockpiling copper as part of "Project Vault" and the strong likelihood that China will add to its own strategic copper stockpile. Thus, in spite of underwhelming physical demand for copper in the copper fabricating industry prices are likely to remain strong in 2026. 

Growing future demand for copper, driven by green energy transition and AI data centres, will necessitate the development of intrinsically higher capital cost greenfield mines from the world's remaining inventory of lower-grade undeveloped copper deposits, which, in combination with higher operating costs and taxes, is expected to result in strong copper prices in 2027 and beyond.

Zinc

The LME Cash zinc price began the year at approximately $1.30 per pound, dropped significantly to an annual low of $1.14 per pound in mid-April after the Liberation Day tariff announcements and then steadily increased for the rest of the year to end the year at $1.39 per pound. The average price for the year was $1.30 per pound.

So far in 2026 the zinc price has continued its upward trend reaching a high of $1.58 on January 29.  The International Lead Zinc Study Group (ILZSG) is projecting a growing surplus for zinc in 2026  with refined production outpacing demand and a variety of new mines coming into production so zinc prices may moderate as the year progresses. 

37

Gold

The physical supply and demand for gold is not an arbitrator of future prices as it is with base metals because most of the gold ever mined is stored in bank vaults. Gold is an investment that has traditionally provided a safe haven for investors during uncertain economic times, as well as a hedge against inflation, future currency devaluation and declining values of other riskier asset classes. After posting a 26% price gain in 2024 and ending the year at $2,609 per ounce, the gold price followed up with an even more impressive price gain of 66% in 2025, closing the year at $4,319 per ounce.  Gold strong price performance in 2025 was driven by a combination of factors including strong Central bank purchases out of China and Russia as they move to replace their US dollar reserves with gold, increased geopolitical instability and concerns about the effect of the US government policies on world trade, inflation and the US dollar which have led to the adoption of gold as a significant asset class by an increasing number of investors. In the first month of 2026, the gold price maintained its momentum, hitting an all-time high of $5,417 per ounce (AM fix on the LBMA) on January 28th before retreating very rapidly back below $5,000 per ounce.  While the spot gold price is expected to remain volatile during the balance of 2026, the long-term consensus price for gold has escalated significantly over the last two years which should lead to an extended period of strong profitability for gold producers.

Treatment Charges, Refining Charges, and Freight Costs

Hudbay's operating margins are affected by a variety of third-party processing charges and logistics costs that must be incurred to convert Hudbay's concentrates into refined metal. For the copper, zinc and molybdenum concentrates that Hudbay produce, the Company will pay freight costs to deliver these products from its facilities to its customers which include, depending on the destination, various combinations of truck, rail or ocean freight costs along with warehousing and loading fees. The Company also pay treatment and refining charges ("TC/RCs") to its customers who process the Company's copper concentrates. For precious metal doré Hudbay produces, the Company incurs transportation costs to ship to a third-party refinery.

The copper concentrate market remains exceptionally tight, due to a global oversupply of smelting capacity relative to mine production. This fundamental tightness is reflected in both benchmark and spot treatment and refining charges. Chinese smelters have agreed 2026 benchmark TC/RCs at $0/0 cents, down significantly from last year's Chinese benchmark, and representing yet another record low. Spot copper treatment and refining charges are even more extreme, currently trading at negative triple digits for sales from miners to traders. It is unclear when, or how, the copper concentrate market will approach more balanced levels in the short term. Hudbay is also exposed to zinc concentrate treatment charges, as a seller of zinc concentrate. The 2026 zinc concentrate benchmark has not been established yet. While the 2026 benchmark had been expected to increase versus 2025's record low of $80/dmt, the recent tightening in the spot market makes this outcome less certain. Current spot rates, on a delivered China basis, are ~$40/dmt.

Spot bulk ocean freight rates have declined since year end, currently offering attractive spot rates at all of the Company's mines in a historical context. Subdued bunker prices and freight demand uncertainty in part due to geopolitical issues, are expected to constrain spot freight rates for the next several quarters. Consequently, Hudbay will be afforded the opportunity to lock in contracts of affreightment at terms likely attractive relative to 2025.

Sensitivity Analysis

The following table displays the estimated impact of changes in metals prices and foreign exchange rates on The Company's 2026 net profit, earnings per share and operating cash flow, assuming that Hudbay's operational performance is consistent with the mid-point of its guidance for 2026. The effects of a given change in an assumption are calculated in isolation.

	2026 Base	Change of +/-10% represented by +/-:	Impact on Profit +/-	Impact on EPS +/- 1	Impact on Operating CF before changes in NCWC +/-
Metals Prices
Copper price2	$4.75/lb	$0.48/lb	$82M	$0.21	$98M
Gold price3	$3,850/oz	$385/oz	$52M	$0.13	$74M
Zinc price	$1.30/lb	$0.13/lb	$3M	$0.01	$4M
Exchange Rates 4
C$/US$	1.37	0.14	$77M	$0.19	$56M

¹ Based on 396.8 million common shares outstanding as at December 31, 2025.

² Quotational period hedging program neutralizes provisional pricing adjustments.

³ Gold price sensitivity also includes an impact of a +/- 10% change in the silver price (2026 assumption: $42.00/oz of silver).

⁴ Change in profit from operational performance only, does not include change in profit arising from translation of balance sheet accounts.

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FINANCIAL REVIEW

Financial Results

In the fourth quarter of 2025, Hudbay recorded net earnings attributable to owners of $128.0 million compared to the net earnings on the same basis of $21.2 million in the fourth quarter of 2024, representing an increase in net earnings attributable to owners of $106.8 million. For the full year of 2025, Hudbay recorded net earnings attributable to owners of $568.5 million compared to net earnings on the same basis of $76.7 million for the same period in 2024, representing an increase in earnings attributable to owners of $491.8 million.

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

(in $ millions)	Three months ended December 31, 2025	Year ended December 31, 2025
Increase (decrease) in components of earnings:
Revenues	148.0	189.8
Cost of sales
Mine operating costs	(32.0)	12.7
Depreciation and amortization	(30.3)	(13.1)
Selling and administrative expenses	(19.0)	(37.7)
Exploration expenses	(0.7)	(3.7)
Other operating expenses	35.7	49.6
Re-evaluation adjustment - environmental obligation	2.7	(3.7)
Impairment reversal	-	322.3
Consideration received from sale of non-core project	-	14.9
Net finance expense1	49.0	129.3
Tax expense	(44.7)	(163.9)
Increase in net earnings for the period	108.7	496.5
Change in non-controlling interest	(1.9)	(4.7)
Increase in net earnings attributable to owners for the period	106.8	491.8

¹Net finance expense includes net interest expense on long-term debt, accretion on streaming arrangements, change in fair value of financial instruments and other net finance (income) cost.

Revenue

Revenue for the fourth quarter of 2025 was $732.9 million, $148.0 million higher than the same period in 2024, primarily due to stronger copper and gold realized prices, lower treatment and refining charges, offset by lower sales volume of all metals.

Revenue during the year ended December 31, 2025 was $2,211.0 million, $189.8 million higher than in 2024, primarily as a result of higher metal prices, lower treatment and refining charges, partially offset by lower sales volume of all metals.

While a majority of revenues continue to be from copper, gold represented a significant portion of total revenues at 41% and 38% for the three months and year-ended December 31, 2025, respectively. This is as a result of exposure to higher gold prices.

39

The following table provides further details on these variances:

(in $ millions)	Three months ended December 31, 2025	Year ended December 31, 2025 2
Metals prices1
Higher copper prices	80.5	117.8
Higher gold prices	105.7	275.0
Higher zinc prices	-	1.0
Higher silver prices	7.2	13.4
Sales volumes
Lower copper sales volumes	(34.2)	(97.3)
Lower gold sales volumes	(19.3)	(168.3)
Lower zinc sales volumes	(3.9)	(27.7)
Lower silver sales volumes	(6.5)	(8.7)
Other
Molybdenum and other volume and pricing differences	(1.6)	2.0
Variable consideration adjustments	-	13.7
Effect of lower treatment and refining charges	20.1	68.9
Increase in revenue in 2025 compared to 2024	148.0	189.8

¹ See discussion below for further information regarding metals prices. 

² Copper Mountain mine results are stated at 100%

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

	Three months ended			Year ended
(in $ millions)	Dec. 31, 2025	Sep. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Copper	383.3	178.8	349.0	1,161.5	1,154.8
Gold	285.5	125.5	199.6	794.4	673.6
Zinc	12.5	9.6	16.4	43.5	71.1
Silver	16.3	9.1	15.7	53.6	51.5
Molybdenum	9.9	14.0	9.1	63.9	60.1
Other metals	0.2	-	1.2	-	1.7
Revenue from contracts	707.7	337.0	591.0	2,116.9	2,012.8
Amortization of deferred revenue - gold	14.7	2.3	14.6	31.3	40.7
Amortization of deferred revenue - silver	9.3	4.0	11.6	33.8	33.6
Amortization of deferred revenue - variable consideration adjustments - prior periods	-	-	-	9.9	(3.8)
Pricing and volume adjustments1	7.0	8.8	(6.4)	47.5	35.2
Treatment and refining charges	(5.8)	(5.3)	(25.9)	(28.4)	(97.3)
Revenue	732.9	346.8	584.9	2,211.0	2,021.2

¹ Pricing 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 20 of Hudbay's consolidated financial statements.

40

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 December 31, and September 30, 2025 and year ended December 31, 2025 and 2024, respectively, are summarized below:

			Realized prices1 for the				Realized prices1 for the
			Three months ended				Year ended
Prices		LME QTD 20252	Dec. 31, 2025	Sep. 30, 2025	Dec. 31, 2024	LME YTD 20252	Dec. 31, 2025	Dec. 31, 2024
Copper	$/lb	5.03	5.17	4.37	4.09	4.51	4.64	4.18
Gold3	$/oz	4,152	3,580	3,522	2,327	3,440	3,297	2,241
Zinc	$/lb		1.39	1.30	1.39		1.29	1.26
Silver3	$/oz		31.34	33.22	23.12		28.43	24.23

¹ Realized 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.

³ Sales 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 45 of this MD&A.

41

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 consolidated statements of income.

As of December 31, 2025, Hudbay had no non-QP hedges outstanding.

During the first quarter of 2026, Hudbay entered into the following non-QP hedges:

• Forward sales contracts for a total of 2,200 tonnes of copper production over the period of June 2026 to April 2027 at an average price of $6.02 per pound; and

• Zero-cost collar program for 4,400 tonnes of copper production over the period of June 2026 to April 2027 at an average floor price of $5.75 per pound and an average cap price of $6.34 per pound.

Together, the forward copper sales and zero copper cost collar hedges represent approximately 20% of Copper Mountain's expected 2026 production.

42

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

Three months ended December 31, 2025
(in $ millions except for realized price and payable metal sold) 1	Copper	Gold	Zinc	Silver	Molybdenum	Other	Total
Revenue from contracts 2	383.3	285.5	12.5	16.3	9.9	0.2	707.7
Amortization of deferred revenue	-	14.7	-	9.3	-	-	24.0
Pricing and volume adjustments 3	5.4	2.0	(0.3)	1.7	(1.8)	-	7.0
Revenue, including mark-to-market on QP hedges 4	388.7	302.2	12.2	27.3	8.1	0.2	738.7
Realized non-QP derivative mark-to-market	-	-	-	-	-	-	-
By-product credits 5	388.7	302.2	12.2	27.3	8.1	0.2	738.7
Payable metal in concentrate and doré sold 6	34,132	84,424	3,972	871,006	190	-	-
Realized price 7	5.17	3,580	1.39	31.34	-	-	-
Realized price, including realized non-QP derivative 7	5.17	3,580	1.39	31.34	-	-	-
Three months ended September 30, 2025
Revenue from contracts 2	178.8	125.5	9.6	9.1	14.0	-	337.0
Amortization of deferred revenue	-	2.3	-	4.0	-	-	6.3
Pricing and volume adjustments 3	(2.5)	7.0	0.3	0.8	3.2	-	8.8
Revenue, including mark-to-market on QP hedges 4	176.3	134.8	9.9	13.9	17.2	-	352.1
Realized non-QP derivative mark-to-market	-	-	-	-	-	-	-
By-product credits 5	176.3	134.8	9.9	13.9	17.2	-	352.1
Payable metal in concentrate and doré sold 6	18,280	38,279	3,452	418,418	269	-	-
Realized price 7	4.37	3,522	1.30	33.22	-	-	-
Realized price, including realized non-QP derivative 7	4.37	3,522	1.30	33.22
Three months ended December 31, 2024
Revenue from contracts 2	349.0	199.6	16.4	15.7	9.1	1.2	591.0
Amortization of deferred revenue	-	14.6	-	11.6	-	-	26.2
Pricing and volume adjustments 3	(6.6)	1.6	(0.3)	(0.7)	(0.4)	-	(6.4)
Revenue, including mark-to-market on QP hedges 4	342.4	215.8	16.1	26.6	8.7	1.2	610.8
Realized non-QP derivative mark-to-market 5	(1.3)	(2.9)	-	-	-	-	(4.2)
By-product credits 4	341.1	212.9	16.1	26.6	8.7	1.2	606.6
Payable metal in concentrate and doré sold 6	37,927	92,734	5,261	1,150,518	182	-	-
Realized price 7	4.09	2,327	1.39	23.12	-	-	-
Realized price, including realized non-QP derivative 7	4.08	2,296	1.39	23.12

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

² As per IFRS Accounting Standards.

³ Pricing 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.

⁶ Copper 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.

43

Year ended December 31, 2025
(in $ millions except for realized price and payable metal sold) 1	Copper	Gold	Zinc	Silver	Molybdenum	Other	Total
Revenue from contracts 2	1,161.5	794.4	43.5	53.6	63.9	-	2,116.9
Amortization of deferred revenue	-	31.3	-	33.8	-	-	65.1
Pricing and volume adjustments 3	10.2	32.5	(0.3)	3.3	1.8	-	47.5
Revenue, including mark-to-market on QP hedges 4	1,171.7	858.2	43.2	90.7	65.7	-	2,229.5
Realized non-QP derivative mark-to-market	(2.3)	-	-	-	-	-	(2.3)
By-product credits 5	1,169.4	858.2	43.2	90.7	65.7	-	2,227.2
Payable metal in concentrate and doré sold 6	114,534	260,261	15,152	3,190,552	1,334	-	-
Realized price 7	4.64	3,297	1.29	28.43	-	-	-
Realized price, including realized non-QP derivative 7	4.63	3,297	1.29	28.43	-	-	-
Year ended December 31, 2024
(in $ millions except for realized price and payable metal sold) 1	Copper	Gold	Zinc	Silver	Molybdenum	Other	Total
Revenue from contracts 2	1,154.8	673.6	71.1	51.5	60.1	1.7	2,012.8
Amortization of deferred revenue	-	40.7	-	33.6	-	-	74.3
Pricing and volume adjustments 3	(3.6)	37.2	(1.2)	0.9	1.9	-	35.2
Revenue, including mark-to-market on QP hedges 4	1,151.2	751.5	69.9	86.0	62.0	1.7	2,122.3
Realized non-QP derivative mark-to-market	(5.2)	(3.7)	-	-	-	-	(8.9)
By-product credits 5	1,146.0	747.8	69.9	86.0	62.0	1.7	2,113.4
Payable metal in concentrate and doré sold 6	125,094	335,342	25,120	3,549,816	1,287	-	-
Realized price 7	4.18	2,241	1.26	24.23	-	-	-
Realized price, including realized non-QP derivative 7	4.16	2,230	1.26	24.23	-	-	-

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

² As per consolidated financial statements.

³ Pricing 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.

⁶ Copper 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.

44

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		Year ended		Three months ended		Year ended
Revenue		Dec. 31, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Stream		22.0	22.2	46.8	61.8	13.2	16.6	47.9	48.0
Offtaker		280.2	193.6	811.4	689.7	14.1	10.0	42.8	38.0
Revenue, including mark-to-market on QP hedges 3		302.2	215.8	858.2	751.5	27.3	26.6	90.7	86.0
Payable metal sold
Stream	oz	17,029	17,873	36,352	49,822	612,924	796,849	2,242,607	2,310,394
Offtaker	oz	67,395	74,861	223,909	285,520	258,082	353,669	947,945	1,239,422
Total payable metal sold	oz	84,424	92,734	260,261	335,342	871,006	1,150,518	3,190,552	3,549,816
Deferred revenue drawdown rate1	$/oz	860	817	860	817	15.06	14.56	15.06	14.56
Cash rate2	$/oz	429	425	427	423	6.33	6.26	6.29	6.23
Stream realized price	$/oz	1,289	1,242	1,287	1,240	21.39	20.82	21.35	20.79
Offtaker realized price	$/oz	4,158	2,586	3,624	2,416	54.63	28.28	45.15	30.66
Realized price	$/oz	3,580	2,327	3,297	2,241	31.34	23.12	28.43	24.23

¹ Deferred 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, 2025, the deferred revenue amortization is recorded in Peru at $860 per ounce gold and $15.06 per ounce silver (December 31, 2024 - $817 per ounce gold and $14.56 per ounce silver).

45

Cost of Sales

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

(in $ millions)	Three months ended			Year ended
	Dec. 31, 2025	Sep. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Peru
Mining	37.6	34.8	47.3	131.5	145.5
Milling	52.0	40.8	53.6	195.0	197.1
Changes in product inventory	15.6	(26.9)	(6.7)	6.5	9.6
Depreciation and amortization	115.8	50.0	83.2	290.0	270.3
G&A	48.3	19.5	33.3	113.8	96.0
Overhead costs incurred during Peru temporary suspension (cash)	1.3	7.3	-	8.6	-
Inventory adjustments	(0.2)	(1.3)	(0.2)	-	-
Freight, royalties and other charges	20.2	10.9	20.7	60.8	69.2
Total Peru cost of sales	290.6	135.1	231.2	806.2	787.7
Manitoba
Mining	39.3	15.8	42.6	126.9	169.4
Milling	16.2	5.9	16.6	49.9	65.2
Changes in product inventory	(2.2)	3.1	(0.3)	3.7	(2.0)
Depreciation and amortization	22.6	16.3	27.2	86.4	106.2
Overhead costs incurred during Manitoba temporary suspension (cash)	-	16.0	-	19.2	-
Inventory adjustments	0.8	-	0.3	1.8	1.7
G&A	17.5	6.4	13.0	53.3	48.7
Past service costs	-	-	1.5	-	4.3
Freight, royalties and other charges	5.1	2.5	7.0	18.4	25.4
Total Manitoba cost of sales	99.3	66.0	107.9	359.6	418.9
British Columbia1
Mining	26.3	19.6	18.2	92.0	79.1
Milling	28.3	29.1	25.2	100.6	89.8
Changes in product inventory	(9.1)	4.2	(3.0)	(2.1)	3.8
Depreciation and amortization	14.1	16.4	11.8	63.3	50.1
G&A	10.2	7.6	5.0	30.7	20.0
Inventory adjustments	0.1	-	1.2	2.3	1.2
Freight, royalties and other charges	3.0	3.5	3.0	15.2	16.8
Total British Columbia cost of sales	72.9	80.4	61.4	302.0	260.8
Cost of sales	462.8	281.5	400.5	1,467.8	1,467.4

¹ Copper Mountain mine results are stated at 100%.

Total cost of sales for the fourth quarter of 2025 was $462.8 million, reflecting an increase of $62.3 million compared to the fourth quarter of 2024.

Peru cost of sales increased by $59.4 million in the fourth quarter of 2025, compared to the same period of 2024 primarily due to higher depreciation primarily as a result of Pampacancha being fully depleted in December 2025 and higher change in product inventory as a result of a 20,000 dry metric tonne copper concentrate shipment from September being deferred to early October 2025, resulting in a larger drawdown of product inventory in the fourth quarter. Manitoba cost of sales decreased by $8.6 million in the fourth quarter of 2025 when compared to the same period of 2024, primarily driven by lower operating activity due to a one-week winter power outage which resulted in lower mining and milling costs as well as lower depreciation. These decreases to Manitoba cost of sales were partially offset by higher profit sharing in the fourth quarter of 2025 compared to the same period in 2024. British Columbia cost of sales increased by $11.5 million primarily driven by higher mining, milling and G&A costs. Mining and G&A costs were higher as the operation transitioned towards an expanded in-house workforce leading to the hiring of 240 new employees as Hudbay continues to ramp-up its optimization plans at Copper Mountain. Milling costs were higher primarily because of lower milled throughput and non-recurring costs associated with the unplanned primary SAG mill maintenance.

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Total cost of sales for the year ended December 31, 2025 was $1,467.8 million, remaining relatively consistent with the comparable period, reflecting an increase of $0.4 million.

Peru cost of sales increased by $18.5 million for the year ended December 31, 2025, compared to the same period of 2024 primarily due to the same factors mentioned above, as well as $8.6 million in direct charge to cost of sales as a result of the temporary suspension of operations in the third quarter of 2025. Manitoba cost of sales decreased by $59.3 million primarily due to the Manitoba wildfires leading to lower overall costs in-line with lower production. These decreases have been partially offset by higher overhead costs incurred during the temporary suspension and changes in product inventory. British Columbia cost of sales increased by $41.2 million primarily driven by higher mining, milling, depreciation and G&A, partially offset by lower freight, royalties and other charges and a decrease in changes in product inventory.

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

For the fourth quarter of 2025, other significant variances in expenses, compared to the same period in 2024, include the following:

- General administration expenses increased by $19.0 million, primarily due to an increase of $22.5 million in share-based compensation mostly from the revaluation of share units to higher stock prices compared to prior period.

- Other operating expenses decreased by $35.7 million, primarily due to a gain of $25.0 million from business interruption insurance proceeds in Manitoba from the temporary suspension of operations related to the wildfire evacuation orders and a decrease of $11.2 million in write-off of previously capitalized PP&E costs.

- Net finance expenses decreased by $49.0 million, primarily due to an increase in mark-to-market gains of $32.5 million from investments, decrease in foreign exchange loss of $22.7 million from the revaluation of foreign currency monetary balances, a decrease of $1.4 million from interest expense on long-term debt benefiting from the retirement of some senior notes, partially offset by an increase in losses of $7.6 million from non-QP hedges.

For the full year of 2025, other significant variances in expenses, compared to the same period in 2024, included the following:

- General administration expenses increased by $37.7 million, primarily due to an increase of $37.3 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 $3.7 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 decreased by $49.6 million, primarily due to a gain of $25.0 million from business interruption insurance proceeds in Manitoba as noted above, a decrease of $23.9 million due to a write-off of previously capitalized PP&E costs, an increase of $4.1 million from the Marubeni option agreement as funds are spent on exploration work, higher income of $3.5 million from the amortization of obligations related to the flow through share deferred liability, partially offset by an increase of $4.4 million related to Manitoba wildfire evacuation costs.

- Re-evaluation adjustment - environmental provision gain decreased by $3.7 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.

- Impairment reversal gain reflects a non-cash full impairment reversal of $322.3 million on the carrying value of the Copper World project, following the announcement of the Copper World JV Transaction with Mitsubishi for a 30% minority interest.

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- Consideration received from sale of non-core project reflects $14.9 million contingent consideration received from an asset previously sold by Copper Mountain Mining Corporation.

- Net finance expenses decreased by $129.3 million due to an increase in mark-to-market gains of $52.0 million from investments, a $39.6 million decrease in net foreign exchange loss from the revaluation of foreign currency monetary balances, a decrease in the relative revaluation loss of the now retired gold prepayment liability of $10.7 million, a $9.1 million decrease in interest expense on long-term debt, decrease in losses of $6.8 million from non-QP hedges, an increase of $6.6 million in interest income, partially offset by an increase of $2.3 million in interest on equipment financing and leases.

Tax Expense

For the three and twelve months ended December 31, 2025, tax expense increased by $44.7 million and $163.9 million, respectively, compared to the same period in 2024. The following table provides further details:

(in $ millions)	Three months ended		Year ended
	Dec. 31, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Current tax expense - income tax	112.8	52.2	210.6	119.9
Deferred tax expense (recovery) expense - income tax1	(19.4)	15.1	60.2	13.9
Total income tax expense	93.4	67.3	270.8	133.8
Current tax expense - mining tax	37.6	19.2	80.7	57.0
Deferred tax recovery - mining tax1	(1.9)	(2.1)	(3.8)	(7.0)
Total mining tax expense	35.7	17.1	76.9	50.0
Tax expense	129.1	84.4	347.7	183.8
1 Deferred tax expense (recovery) represents Hudbay's draw down/increase of non-cash deferred income and mining tax assets/liabilities.

Income Tax Expense

Applying the estimated Canadian statutory income tax rate of 26.7% to Hudbay's net earnings before taxes of $912.0 million for the full year of 2025 would have resulted in a tax expense of approximately $243.5 million; however, Hudbay recorded an income tax expense of $270.8 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:

- Foreign exchange on the translation of deferred tax balances to group currency, resulting in a deferred tax recovery of $15.4 million.

- 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 in a tax expense of $71.6 million.

- Current mining tax deductions resulted in a tax recovery of $24.2 million.

Mining Tax Expense

For the full year of 2025, Hudbay recorded a mining tax expense of $76.9 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 C$55 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%.

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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 December 31, 2025, at the tax rate expected to apply 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 December 31, 2025, Hudbay's total liquidity of $993.7 million includes $568.9 million in cash as well as undrawn total availability of $424.8 million under Hudbay's revolving credit facilities.

Senior Unsecured Notes

As at December 31, 2025, Hudbay had $472.5. million aggregate principal amount of 2026 Notes and $542.4 million aggregate principal amount of 2029 Notes.

During the full year 2025, Hudbay made open market purchases of $102.5 million of its 4.5% senior notes due April 2026 ("2026 Notes"), at a discount to par. As at December 31, 2025, Hudbay has presented all of the 2026 Notes as a current liability amounting to $472.1 million, which affected working capital in the period.

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. These 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 December 31, 2025, there were no cash drawings under the Revolving Credit Facilities and $25.2 million in letters of credit secured under the Canadian Facility.

As at December 31, 2025, Hudbay was in compliance with its covenants under the Credit Facilities.

Closing of $600 Million Strategic Investment

Subsequent to year-end, Hudbay successfully closed its previously announced strategic partnership with Mitsubishi on January 9, 2026. Under the terms of the agreement, Mitsubishi acquired a 30% interest in the Copper World project for total cash consideration of $600 million. Upon the closing of the partnership, Hudbay received approximately $420 million in cash, which is specifically earmarked to fund the construction and development of Copper World. The remaining $180 million is scheduled to be received within 18 months of closing, in accordance with the terms of the definitive subscription agreement.

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 December 31, 2025, the Manitoba business unit had drawn $56.4 million in letters of credit under the LC Facility.

Surety Bonds and Letters of Credit

As at December 31, 2025, the United States business unit had $18.4 million in surety bonds issued to support future reclamation and closure obligations and the Peru business unit had $135.0 million in letters of credit and surety bonds issued with various Peruvian financial institutions to support future reclamation and other operating matters. In addition, the British Columbia business unit had $47.9 million in surety bonds issued to support future reclamation and $1.3 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.

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Working Capital

Working capital decreased by $576.9 million to a negative position of $65.6 million from December 31, 2024 to December 31, 2025, primarily due to reporting a current portion of long-term debt of $472.1 million as the 2026 Notes are now maturing within one year, an increase in other financial liabilities of $84.6 as a result of the revaluation of derivative liabilities and changes to agreements with communities, an increase in trade and other payables of $72.6 million mostly as a result of timing of payables on capital items and employee profit sharing, an increase in other liabilities of $60.3 million primarily related to share based compensation, a decrease in short-term investments of $40.0 million from the release of guaranteed investment certificates, an increase in taxes payable of $16.7 million and a decrease in other financial assets of $14.5 million.

Partially offsetting these items was an increase in trade and other receivables of $142.3 million primarily due to higher metal prices and timing of sales, an increase in cash and cash equivalents of $27.1 million, a decrease in deferred revenue of $11.0 million and a decrease in lease liabilities of $3.8 million.

Cash Flows

The following table summarizes Hudbay's cash flows for the three months ended December 31, 2025, June 30, 2025 and December 31, 2024:

(in $ millions)	Three months ended			Year ended
	Dec. 31, 2025	Sept. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Operating cash flow before change in non-cash working capital	336.9	70.3	231.5	764.3	691.1
Change in non-cash working capital	(127.5)	43.2	6.6	(57.0)	(24.9)
Cash generated from operating activities	209.4	113.5	238.1	707.3	666.2
Cash used in investing activities	(183.6)	(99.9)	(99.6)	(468.4)	(382.9)
Cash (used in) generated from financing activities	(68.7)	(26.3)	(36.9)	(214.4)	10.2
Effect of movement in exchange rates on cash	0.7	(1.7)	(3.1)	2.6	(1.5)
Net (decrease) increase in cash	(42.2)	(14.4)	98.5	27.1	292.0

Cash Flow from Operating Activities

Cash generated from operating activities was $209.4 million during the fourth quarter of 2025, a decrease of $28.7 million compared to the same period in 2024. Operating cash flow before change in non-cash working capital was $336.9 million during the fourth quarter of 2025, reflecting an increase of $105.4 million compared to the fourth quarter of 2024. The increase in operating cash flows before change in working capital compared with the fourth quarter of 2024 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.

Full year 2025 cash generated from operating activities was $707.3 million in 2025, an increase of $41.1 million compared to the same period in 2024. Operating cash flow before changes in non-cash working capital for the year ended 2025 was $764.3 million, an increase of $73.2 million compared to the same period in 2024. The increase in operating cash flow before changes in working capital was primarily the result of higher metal prices and lower treatment and refining charges, partially offset by the interruptions in Manitoba and Peru impacting full year 2025 sales volumes and a significant increase in cash taxes paid of $135.9 million mainly at Hudbay's Manitoba and Peru operations.

Cash Flow from Investing and Financing Activities

During the fourth quarter of 2025, Hudbay spent $252.3 million in investing and financing activities, primarily driven by $143.2 million in capital expenditures, $42.5 million in purchase of investments, $39.2 million toward the repurchase of senior unsecured notes net of discounts, $15.8 million in capitalized lease and equipment financing payments and $1.8 million in financing costs paid. These cash outflows were offset by cash inflows of $15.7 million proceeds from flow through share financing, net of share issuance costs, $5.4 million of investment income received and $4.5 million from the contingent consideration received on the sale of a non-core project.

Full year 2025, Hudbay spent $682.8 million in investing and financing activities, primarily driven by $466.7 million in capital expenditures, $102.1 million of Hudbay's senior unsecured notes repurchased net of discounts, $61.8 million in net purchases of investments, $58.4 million in interest paid on Hudbay's long-term debt, $57.1 million in capitalized lease and equipment financing payments, $17.5 million in community agreement payments, $11.7 million in financing costs paid, $6.0 million in the Copper Mountain non-controlling interest acquisition payment and related transaction costs, $5.6 million in dividends paid, $3.4 million in payments made on settlement of non-QP hedges and $2.8 million in acquisition of intangible assets.

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This was offset by cash inflows of $40.0 million from the release of the guaranteed investment certificates, $26.8 million of proceeds from equity issuance and flow through share financing, net of share issuance costs, $24.0 million of investment income received, $14.9 million from the contingent consideration received on the sale of a non-core project, and $3.1 million from net proceeds from the exercise of stock options and warrants.

Capital Expenditures

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

	Three months ended			Year ended		Guidance
	Dec. 31, 2025	Sept. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024	Annual
(in $ millions)						20252
Peru sustaining capital expenditures1	40.5	23.6	29.9	137.0	124.4	170.0
Manitoba sustaining capital expenditures	16.4	5.5	12.5	45.7	45.6	60.0
British Columbia sustaining capital expenditures1,3	34.9	42.1	29.2	131.4	123.1	135.0
Total sustaining capital expenditures	91.8	71.2	71.6	314.1	293.1	365.0
Copper World growth capitalized costs4	28.0	18.4	13.4	71.5	28.9	110.0
Peru growth capitalized expenditures	1.0	1.5	0.5	4.7	0.8	25.0
Manitoba growth capitalized expenditures	2.2	1.3	2.3	7.4	7.0	15.0
British Columbia growth capitalized expenditures	15.4	21.3	4.7	64.2	8.1	75.0
Capitalized exploration	8.3	2.8	6.7	15.6	12.2	10.0
Right-of-use asset and equipment financing additions	18.1	3.7	42.3	50.7	96.5
LOM Community agreement additions	9.2	13.6	12.7	23.4	14.5
Non-cash capitalized stripping	5.9	7.4	6.2	28.2	24.5
Grants	(1.3)	(0.7)	(0.7)	(3.5)	(3.1)
Other capitalized costs	6.2	0.3	3.7	6.2	3.7
Total other capitalized expenditures	93.0	69.6	91.8	268.4	193.1
Total accrued capital additions	184.8	140.8	163.4	582.5	486.2
Reconciliation to cash capital additions:
Other capitalized costs2	(33.2)	(24.7)	(61.2)	(102.3)	(135.5)
Change in capital accruals and other	(8.4)	(5.7)	(5.2)	(13.5)	(3.6)
Acquisition of property, plant & equipment - cash	143.2	110.4	97.0	466.7	347.1

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

² Other capitalized costs primarily include right-of-use lease and equipment financing additions, which are excluded from guidance in 2025, community agreement additions and non-cash capitalized stripping.

³ Includes 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%.

⁴ With the announcement of the JV Transaction Hudbay expects to accelerate detailed engineering, long lead items and other de-risking activities by advancing $20 million in growth capital expenditures to 2025 from future years, updating total 2025 Copper World growth spending guidance to $110 million compared to the original 2025 guidance of $90 million.

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For the quarter and year ended December 31, 2025, total capital additions increased by $21.4 million and $96.3 million, respectively, compared to the same period in 2024, primarily due to a planned increase in growth capital in British Columbia and Copper World.

Sustaining capital expenditures in Peru for the quarter and year ended December 31, 2025 were $40.5 million and $137.0 million, respectively, representing an increase of $10.6 million and $12.6 million, respectively, compared to the same periods in 2024 as a result of the timing of various stripping campaigns and civil work projects. Sustaining capital expenditures in Manitoba for the quarter and year ended December 31, 2025 were $16.4 million and $45.7 million, respectively, representing an increase of $3.9 million and $0.1 million, respectively, compared to the same periods in 2024 mostly due to higher capital development at Lalor. Sustaining capital expenditures in British Columbia for the quarter and year ended December 31, 2025 were $34.9 million and $131.4 million, respectively, which included $25.6 million and $97.6 million, respectively, of capitalized stripping related to Hudbay's planned three-year accelerated stripping campaign to access higher grade ore by 2027.

Growth capital expenditures in Peru for the quarter and year ended December 31, 2025 were $1.0 million and $4.7 million, respectively, representing an increase of $0.5 million and $3.9 million, respectively. The increase mainly relates to the implementation of the pebble crusher in Peru. Growth capital spending in Manitoba for the quarter and year ended December 31, 2025 was $2.2 million and $7.4 million, respectively, primarily related to the exploration and haulage drifts towards the 1901 deposit. Growth capital expenditures in British Columbia for the quarter and year ended December 31, 2025 were $15.4 million and $64.2 million, respectively, representing an increase of $10.7 million and $56.1 million, respectively, compared to the same periods in 2024. The increase mainly relates to the Copper Mountain secondary SAG mill optimization project, which is intended to increase nominal capacity at Copper Mountain. Copper World capital expenditures for the quarter and year ended December 31, 2025 were $28.0 million and $71.5 million, respectively, mainly related to feasibility study activities and ongoing carrying costs for Copper World.

Capitalized exploration for the three months and year ended December 31, 2025 was $8.3 million and $15.6 million, respectively.

Total sustaining capital in 2025 was approximately $50 million lower than guidance due to approximately $10 million lower capitalized stripping in Peru from the impact of social unrest, approximately $10 million lower capitalized development at Lalor due to the impact of wildfires, and approximately $38 million in sustaining capital deferrals to 2026, partially offset by $13 million higher capitalized stripping in British Columbia. Excluding Copper World project costs, growth capital in 2025 was approximately $39 million lower than guidance primarily due to timing of expenditure and a majority is expected to be deferred to 2026. Copper World growth spending in 2025 was approximately $39 million lower than guidance due to timing of expenditure, a majority of which will be deferred to 2026.

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Capital Commitments

As at December 31, 2025, Hudbay had outstanding capital commitments in Canada of approximately $29.1 million, of which $18.4 million can be terminated, approximately $25.7 million in Peru primarily related to sustaining capital commitments and exploration option agreements, all of which can be terminated, and approximately $123.4 million in United States, primarily related to the Copper World project, of which $121.2 million can be terminated.

Contractual Obligations

The following table summarizes Hudbay's significant contractual obligations as at December 31, 2025:

	Total	Less than 12 months	13 - 36 months	37 - 60 months	More than 60 months
Payment Schedule (in $ millions)
Long-term debt obligations1	1,148.7	518.8	70.9	559.0	-
Equipment financing and lease obligations	240.4	85.3	101.3	43.1	10.7
Purchase obligation - capital commitments	178.2	128.0	38.5	1.0	10.7
Purchase obligation - other commitments2	1,265.7	507.9	296.5	130.1	331.2
Deferred payment and contingent obligations	39.8	3.0	9.8	13.5	13.5
Pension and other employee future benefits obligations3	93.9	6.3	12.9	8.1	66.6
Community agreement obligations4, 5	136.7	67.0	12.3	9.2	48.2
Decommissioning and restoration obligations5	506.5	19.6	10.4	14.9	461.6
Total	3,609.9	1,335.9	552.6	778.9	942.5

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

² Primarily 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.

⁴ Represents 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 February 18, 2026, the final trading day prior to the date of this MD&A, there were 396,845,111 common shares of Hudbay issued and outstanding. In addition, there were 2,688,437 stock options outstanding.

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FINANCIAL RISK MANAGEMENT

The Financial Risk Management risks in this MD&A are not exhaustive. Please also refer to the heading "Risk Factors" in the Company's most recent Annual Information Form for a discussion of the additional risk factors that may affect Hudbay's business, operations and financial condition. In addition to those risks, the Company has identified the following other risks which may affect its consolidated financial statements in the future.

Metals Price Strategic Risk Management

Commodity prices are a key driver of the Company's financial and operational results. Hudbay's strategic objective is to provide its investors with exposure to base metals prices, unless a reason exists to implement a hedging arrangement. From time to time, the Company maintains price protection programs and conducts commodity price risk management in line with Board-approved policies to reduce risk through the use of financial instruments.

In the normal course, the Company typically consider metal price hedging to manage the risk associated with provisional pricing terms in concentrate sales agreements and in connection with stream delivery obligations. The Company may also occasionally consider metal price hedging in accordance with Board approved policies to achieve strategic objectives, including: locking in favourable metal prices to ensure a minimum cash flow during or after the construction of a mine or major capital project during a period of reduced liquidity, to maintain profitable production of shorter life/higher cost operations or as part of a financing arrangement.

During the year, the Company entered into copper, gold and zinc hedging transactions intended to manage the risk associated with provisional pricing terms in concentrate sales agreements.

As at December 31, 2025, Hudbay had 57.9 million pounds of net copper fixed for floating swaps outstanding at an average fixed receivable price of $5.18/lb associated with provisional pricing risk in concentrate sales agreements. These swaps settled beginning in January 2026 and will continue through May 2026.

As at December 31, 2025, Hudbay had 23,180 ounces of net gold fixed for floating swaps outstanding at an average fixed receivable price of $4,333/ounces associated with provisional pricing risk in concentrate sales agreements. These swaps settled beginning in January 2026 and will continue through February 2026.

As at December 31, 2025, Hudbay had 7.3 million pounds of net zinc swaps outstanding at an effective average fixed receivable price of $1.40/lb associated with provisional pricing risk in concentrate sales agreements. These swaps settled in January 2026.

During the first quarter 2026, Hudbay entered into copper forward sales contracts and zero-cost collar hedges to lock in favourable metal prices to ensure minimum cash flows related to large capital investments at Copper Mountain. A total of 2,200 tonnes of copper production over the period of June 2026 to April 2027 at an average price of $6.02 per pound, as well as a zero-cost collar program for 4,400 tonnes of copper production over the period of June 2026 to April 2027 at an average floor price of $5.75 per pound and an average cap price of $6.34 per pound. Together, the forward sales and zero cost collar hedges entered into during the first quarter of 2026 represent approximately 20% of Copper Mountain's 2026 expected production.

From time to time, the Company enters into gold and silver forward sales contracts to hedge the commodity price risk associated with the future settlement of provisionally priced deliveries. The Company is generally obligated to deliver gold and silver to Wheaton Precious Metals Corp. ("Wheaton") prior to the determination of final settlement prices. These forward sales contracts are entered into at the time Hudbay delivers gold and silver to Wheaton, and are intended to mitigate the risk of subsequent adverse gold and silver price changes. Gains and losses resulting from the settlement of these derivatives are recorded directly to revenue, as the forward sales contracts do not achieve hedge accounting, and the associated cash flows are classified in operating activities. The Company's swap agreements are with counterparties it believes to be creditworthy and do not require the Company to provide collateral.

Carrying Values and Mine Plan Updates

At the end of each reporting period, Hudbay reviews its groups of non-financial assets to determine whether there are any indicators of impairment or impairment reversal. If any such indicator exists, the Company estimates the recoverable amount of the non-financial asset group in order to determine the extent of the impairment loss or reversal, if any. In the third quarter of 2025, Hudbay determined there was an indicator of impairment reversal on the carrying value of the Copper World Project following the announcement of the JV Transaction which resulted in the full reversal of the previously recorded impairment charge. At December 31, 2025, the Company assessed whether there were impairment or impairment reversal indicators associated with the general business environment and known changes to business planning and found that there were no impairment or additional impairment reversal indicators.

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There are a number of potential indicators that could trigger non-financial asset impairment or reversal of impairment in the future. One such potential indicator is a change to the life of mine ("LOM") plan for an asset, which Hudbay generally publish in the first quarter of every year. LOM plans incorporate management's best estimates of key assumptions which include future commodity prices, the value of mineral resources not included in the LOM plan, production based on current estimates of recoverable reserves, discount rates, future operating and capital costs and future foreign exchange rates.

There is a risk that certain assumptions in the updated LOM plans could give rise to an indicator of impairment or impairment reversal and cause an adjustment to the carrying value of the relevant assets and/or impact Hudbay's financial statements.

Interest Rate and Foreign Exchange Risk Management

To the extent that the Company incurs indebtedness at variable interest rates to fund Hudbay's growth objectives, it may enter into interest rate hedging arrangements to manage the Company's exposure to short-term interest rates. To the extent that the Company makes commitments to capital expenditures denominated in foreign currencies, it may enter into foreign exchange forwards or acquire foreign currency outright, which may result in foreign exchange gains or losses in its consolidated statement of earnings.

At December 31, 2025, approximately $526.4 million of Hudbay's cash was held in US dollars, approximately $31.8 million of its cash was held in Canadian dollars, and approximately $10.7 million of its cash was held in Peruvian soles.

Political and Regulatory Changes - Trade

Since the Company operates across several jurisdictions, certain political and regulatory changes in Canada, the US, Peru, and other countries could negatively impact Hudbay's operations and financial results. National elections, including those in Peru, Canada and the US, have brought, or may bring, new political leadership with substantially different political, social, and economic policy priorities on both domestic and foreign policy matters, including with respect to critical minerals, trade and tariffs. Political and regulatory risks such as these could have an impact on Hudbay's operations and financial results. Although the Company does not currently sell any concentrate or precious metal doré into the United States from Canada, the implementation or expansion of tariffs on exported and/or imported mineral products and other consumables could negatively affect profitability, supply chains and the cost of mine operations, development and construction.

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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)	2025				2024
	Q4	Q3	Q2	Q1	Q42	Q3	Q2	Q1
Production on a copper equivalent basis (tonnes)	71,242	46,224	53,693	58,611	77,769	60,895	47,164	62,120
Average realized copper price ($/lb)	5.17	4.37	4.36	4.49	4.09	4.24	4.56	3.91
Average realized gold price ($/oz)	3,580	3,522	3,135	3,002	2,327	2,592	2,222	1,941
Revenue	732.9	346.8	536.4	594.9	584.9	485.8	425.5	525.0
Gross profit	270.1	65.3	176.5	231.3	184.4	139.8	77.6	152.0
Income before tax	257.1	330.5	153.1	171.3	103.7	79.7	0.4	67.8
Net income (loss)	128.0	222.4	114.7	99.2	19.3	50.3	(20.3)	18.5
Net income (loss) - attributable	128.0	222.4	117.7	100.4	21.2	49.7	(16.5)	22.4
Adjusted net earnings 1 - attributable	86.0	10.1	75.5	93.8	70.3	50.2	0.2	59.4
Earnings (loss) per share attributable:
Basic and diluted	0.32	0.56	0.30	0.25	0.05	0.13	(0.04)	0.06
Adjusted net earnings1 per share - attributable	0.22	0.03	0.19	0.24	0.18	0.13	0.00	0.17
Operating cash flow before change in non-cash working capital	336.9	70.3	193.9	163.5	231.5	188.3	123.7	147.5
Adjusted EBITDA1	385.9	142.6	245.2	287.2	257.3	206.0	145.0	215.0
Adjusted EBITDA LTM1	1,060.9	932.3	995.9	895.7	823.3	840.4	825.1	761.3

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 fourth quarter of 2025, copper equivalent production increased to 71,242 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 JV Transaction with Mitsubishi for a 30% minority interest.

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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, benefiting 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 weakening Canadian dollar 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 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.

During the second quarter of 2024, realized copper and gold prices continued to climb which overcame the decline in sales volumes of concentrate compared to the first quarter of 2024. Expected lower mined grades observed for the same metals in Peru and Manitoba were the primary factor for the decline in production since the first quarter of the year. Cost control remained favourable as Hudbay continued to track within cost guidance given the expected cadence in the year's production profile. Higher mining taxes continued as Hudbay experienced higher profitability over the past several quarters. Lastly, volatile inter-period copper and gold prices led to relatively high mark-to-market adjustments for Hudbay's strategic non-QP hedging program and high share prices for Hudbay's common shares led to higher share-based compensation expenses. This led to a total of $19.5 million in mark-to-market adjustments to be added back in Hudbay's adjusted net earnings - attributable to owners measure.

The first quarter of 2024 reflected the continuation of strong copper, gold and silver production that commenced in the third quarter of 2023. The increase in copper, gold and silver prices in the first quarter of 2024 also contributed to strong revenue and profitability in the quarter.

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The following table sets forth selected consolidated financial information for each of the three most recently completed years:

(in $ millions, except for earnings (loss) per share, dividends declared per share, production on a copper equivalent basis and average realized copper price)	2025	2024	2023
Production on a copper equivalent basis (tonnes)	229,770	247,948	225,430
Average realized copper price ($/lb)	4.64	4.18	3.84
Average realized gold price ($/oz)	3,297	2,241	1,898
Revenue	2,211.0	2,021.2	1,690.0
Gross profit	743.2	553.8	392.5
Income before tax	912.0	251.6	151.8
Net income	564.3	67.8	69.5
Net income - attributable
Adjusted net earnings - attributable 1	265.5	181.4	69.0
Earnings per share attributable:
Basic and diluted	1.44	0.20	0.22
Adjusted net earnings 1 per share - attributable	0.67	0.48	0.23
Total assets	6,223.3	5,487.6	5,312.6
Working capital	(67.1)	511.3	135.8
Operating cash flow before changes in non-cash working capital	764.3	691.1	570.0
Adjusted EBITDA1	1,060.9	822.5	647.8
Dividends declared per share - C$3	0.02	0.02	0.02

¹ Adjusted net earnings - attributable, adjusted net earnings per share - attributable, and adjusted EBITDA 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 Total non-current financial liabilities consists of non-current other financial liabilities, lease liabilities and long-term debt.

³ Dividend paid during March and September of each year.

Hudbay achieved copper equivalent production of 229,770 tonnes overcoming several temporary operational interruptions in 2025 including social unrest in Peru, fire and weather related disruptions in Manitoba and unplanned primary SAG mill downtime in British Columbia. Despite the resulting lower copper equivalent production, strong metal prices resulted in record annual revenue of $2,211.0 million and record annual adjusted EBITDA of $1,060.9 million. The Company's enhanced operating platform delivered a strong consolidated annual performance despite the mandatory wildfire evacuation shutdowns and temporary operational interruptions resulting in production deferrals during the year. Lower production with high metal prices resulted in a record gross margin and Hudbay significantly outperformed its twice-improved 2025 consolidated cash cost guidance. Strong cost control, higher metal prices and meaningful exposure to gold by-product credits resulted in better-than-expected consolidated 2025 cash cost¹ and sustaining cash cost¹ per pound of copper produced, net of by-product credits, of $(0.22) and $1.30, respectively. Negative working capital of $67.1 million is the result of the reclassification of the 2026 Notes to current liabilities given their imminent maturity. The Company expects to re-establish a more appropriate working capital position in the coming quarters as these notes are refinanced inside of the Company's deleveraging and increasingly favourable liquidity and net debt profile.

Hudbay achieved record production on a copper equivalent basis during 2024 due to additional production from the recently acquired Copper Mountain mine as well a significantly higher copper and gold production from mining the high grade zones of the Pampacancha deposit and higher gold and copper grade zones at Lalor. Operating cash flow before change in non-cash working capital increased by $178.3 million to $570.0 million in 2023 mainly driven by record metal production during the year.

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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.

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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, 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 consolidated statements of income, to adjusted net earnings attributable to owners of the Company for the three months ended December 31 and September 30, 2025 and December 31, 2024 and years ended December 31, 2025 and 2024.

	Three months ended			Year ended
(in $ millions)	Dec. 31, 2025	Sept. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Earnings for the period	128.0	222.4	19.3	564.3	67.8
Tax expense	129.1	108.1	84.4	347.7	183.8
Earnings before tax	257.1	330.5	103.7	912.0	251.6
Adjusting items:
Mark-to-market adjustments1	(5.7)	8.7	(10.3)	6.2	27.1
Foreign exchange (gain) loss	(5.4)	8.8	17.4	(18.6)	21.0
Re-evaluation adjustment - environmental provision	(0.2)	1.4	2.5	0.2	(3.5)
Manitoba cost of sales and other expense from temporary shutdown	0.5	24.2	-	30.0	-
Peru cost of sales from temporary shutdown	2.1	10.9	-	13.0	-
Insurance recovery	(25.0)	-	-	(25.0)	-
Consideration received from sale of non-core project	-	(14.9)	-	(14.9)	-
Copper World impairment reversal	-	(322.3)	-	(322.3)	-
Variable consideration adjustment - stream revenue and accretion	-	-	-	(10.5)	4.0
Inventory adjustments	0.7	(1.3)	1.3	4.1	2.9
Restructuring charges	-	-	-	0.1	1.2
Reduction of obligation to renounce flow-through share expenditures, net of provisions	(1.6)	(0.8)	1.0	(5.5)	(2.0)
Loss/write-down (reversal of) on disposal of PP&E	2.9	(0.3)	14.1	3.5	27.4
Changes in other provisions (non-capital)	-	-	-	0.7	-
Adjusted earnings before income taxes	225.4	44.9	129.7	573.0	329.7
Tax expense	(129.1)	(108.1)	(84.4)	(347.7)	(183.8)
Tax impact of adjusting items	(10.3)	73.3	23.4	37.1	30.8
Adjusted net earnings	86.0	10.1	68.7	262.4	176.7
Adjusted net earnings attributable to non-controlling interest:
Net earnings for the period	-	-	1.9	4.2	8.9
Adjusting items, including tax impact	-	-	(0.3)	(1.1)	(4.2)
Adjusted net earnings - attributable to owners	86.0	10.1	70.3	265.5	181.4
Adjusted net earnings ($/share) - attributable to owners	0.22	0.03	0.18	0.67	0.48
Basic weighted average number of common shares outstanding (millions)	396.3	395.7	394.0	395.5	376.8

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 expenses (recoveries). Also includes gains and losses on disposition of investments.

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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 consolidated statements of income, to adjusted EBITDA for the three months ended December 31 and September 30, 2025 and December 31, 2024 and years ended December 31, 2025 and 2024:

	Three months ended			Year ended
(in $ millions)	Dec. 31, 2025	Sept. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Earnings for the period	128.0	222.4	19.3	564.3	67.8
Add back:
Tax expense	129.1	108.1	84.4	347.7	183.8
Net finance expense	(14.6)	19.6	34.4	19.4	148.7
Other operating expense	(13.6)	9.1	22.1	7.8	57.4
Depreciation and amortization	152.5	82.7	122.2	439.7	426.6
Amortization of deferred revenue and variable consideration adjustment	(24.0)	(6.3)	(26.2)	(75.0)	(70.5)
Adjusting items (pre-tax):
Impairment reversal	-	(322.3)	-	(322.3)	-
Consideration received from sale of non-core project	-	(14.9)	-	(14.9)	-
Re-evaluation adjustment - environmental provision	(0.2)	1.4	2.5	0.2	(3.5)
Inventory adjustments	0.7	(1.3)	1.3	4.1	2.9
Overhead costs incurred during Manitoba temporary suspension (cash)	-	16.0	-	19.2	-
Overhead costs incurred during Peru temporary suspension (cash)	1.3	7.3	-	8.6	-
Option agreement proceeds (Marubeni)	0.9	1.1	-	4.5	(0.4)
Realized loss on non-QP hedges	-	-	(4.2)	(2.3)	(8.9)
Share-based compensation expense 1	25.8	19.7	1.5	59.9	18.6
Adjusted EBITDA	385.9	142.6	257.3	1,060.9	822.5

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 December 31, 2025 and December 31, 2024:

(in $ millions)	Dec. 31, 2025	Dec. 31, 2024
Total debt	1,008.6	1,107.5
Cash and cash equivalents	(568.9)	(541.8)
Short-term investments	-	(40.0)
Net debt	439.7	525.7

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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 December 31, 2025 and December 31, 2024:

(in $ millions, except net debt to adjusted EBITDA ratio)	Dec. 31, 2025	Dec. 31, 2024
Net debt	439.7	525.7
Adjusted EBITDA for the last twelve months	1,060.9	822.5
Net debt to adjusted EBITDA	0.4	0.6

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		Years ended
(in $ millions)	Dec. 31, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Cash generated from operations	209.4	238.1	707.3	666.2
Add back:
Change in non-cash working capital	(127.5)	6.6	(57.0)	(24.9)
Cash sustaining capital expenditures1	108.7	82.6	376.4	334.0
Free cash flow	228.2	148.9	387.9	357.1
Cash sustaining capital expenditures1
Total sustaining capital costs2	91.8	71.6	314.1	293.1
Capitalized lease and equipment financing cash payments -  operating sites	12.5	10.3	53.0	38.4
Community agreement cash payments	4.4	0.7	9.3	2.5
Cash sustaining capital expenditures1	108.7	82.6	376.4	334.0

¹ Excludes amortization of decommissioning and restoration PP&E assets and accretion of decommissioning and restoration liabilities related to producing sites.

² See reconciliation to property, plant & equipment additions starting on page 72 of this MD&A.

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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 December 31, and September 30, 2025 and December 31, 2024 and years ended December 31, 2025 and December 31, 2024. 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								Year ended
(in thousands)	Dec. 31, 2025			Sep. 30, 2025		Dec. 31, 2024			Dec. 31, 2025			Dec. 31, 2024
Peru	55,199			39,934		74,931			187,734			218,260
Manitoba	7,333			1,856		7,379			20,391			27,637
British Columbia	10,373			11,572		13,067			52,435			58,215
Net pounds of copper produced1	72,905			53,362		95,377			260,560			304,112

¹ Contained copper in concentrate.

Consolidated	Three months ended
	Dec. 31, 2025		Sep. 30, 2025		Dec. 31, 2024
Cash cost per pound of copper produced	$ millions	$/lb	$ millions	$/lb	$ millions	$/lb
Cash cost, before by-product credits	304.0	4.17	198.0	3.71	308.6	3.23
By-product credits	(350.0)	(4.80)	(175.8)	(3.29)	(265.5)	(2.78)
Cash cost, net of by-product credits	(46.0)	(0.63)	22.2	0.42	43.1	0.45

63

Consolidated	Year ended
	Dec. 31, 2025		Dec. 31, 2024
Cash cost per pound of copper produced	$ millions	$/lb	$ millions	$/lb
Cash cost, before by-product credits	1,001.3	3.84	1,107.3	3.64
By-product credits	(1,057.8)	(4.06)	(967.4)	(3.18)
Cash cost, net of by-product credits	(56.5)	(0.22)	139.9	0.46

Consolidated	Three months ended
	Dec. 31, 2025		Sep. 30, 2025		Dec. 31, 2024
Cash cost per pound of copper produced	$ millions	$/lb	$ millions	$/lb	$ millions	$/lb
Mining	103.2	1.42	70.2	1.32	108.1	1.13
Milling	96.5	1.32	75.8	1.42	95.4	1.00
G&A	73.4	1.01	31.8	0.59	50.6	0.53
Onsite costs	273.1	3.75	177.8	3.33	254.1	2.66
Treatment & refining	5.8	0.08	5.3	0.10	25.9	0.27
Freight & other	25.1	0.34	14.9	0.28	28.6	0.30
Cash cost, before by-product credits	304.0	4.17	198.0	3.71	308.6	3.23

Consolidated	Year ended
	Dec. 31, 2025		Dec. 31, 2024
Cash cost per pound of copper produced	$ millions	$/lb	$ millions	$/lb
Mining	350.4	1.34	394.0	1.30
Milling	345.5	1.33	352.1	1.16
G&A	191.9	0.74	162.8	0.54
Onsite costs	887.8	3.41	908.9	3.00
Treatment & refining	28.4	0.11	97.3	0.31
Freight & other	85.1	0.33	101.1	0.33
Cash cost, before by-product credits	1,001.3	3.84	1,107.3	3.64

64

Consolidated	Three months ended
	Dec. 31, 2025		Sep. 30, 2025		Dec. 31, 2024
Supplementary cash cost information	$ millions	$/lb 1	$ millions	$/lb 1	$ millions	$/lb 1
By-product credits2:
Zinc	12.2	0.17	9.9	0.18	16.1	0.17
Gold3	302.2	4.15	134.8	2.53	212.9	2.23
Silver3	27.3	0.37	13.9	0.26	26.6	0.28
Molybdenum & other	8.3	0.11	17.2	0.32	9.9	0.10
Total by-product credits	350.0	4.80	175.8	3.29	265.5	2.78
Reconciliation to IFRS:
Cash cost, net of by-product credits	(46.0)		22.2		43.1
By-product credits	350.0		175.8		265.5
Treatment and refining charges	(5.8)		(5.3)		(25.9)
Inventory adjustments	0.7		(1.3)		1.3
Share-based compensation expense	2.6		1.7		0.7
Past service costs	-		-		1.5
Change in product inventory	4.3		(19.6)		(10.0)
Royalties	3.2		2.0		2.1
Overhead costs incurred during Manitoba temporary suspension (cash)	-		16.0		-
Overhead costs incurred during Peru temporary suspension (cash)	1.3		7.3		-
Depreciation and amortization4	152.5		82.7		122.2
Cost of sales5	462.8		281.5		400.5

¹ Per pound of copper produced.

² By-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 43 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 December 31, 2025 the variable consideration adjustments amounted to $nil (three months ended December 31, 2024 - $nil and September 30, 2025 - $nil).

⁴ Depreciation is based on concentrate sold.

⁵ As per consolidated financial statements.

65

Consolidated	Year ended
	Dec. 31, 2025		Dec. 31, 2024
Supplementary cash cost information	$ millions	$/lb1	$ millions	$/lb1
By-product credits2:
Zinc	43.2	0.17	69.9	0.23
Gold3	858.2	3.29	747.8	2.46
Silver3	90.7	0.35	86.0	0.28
Molybdenum & other	65.7	0.25	63.7	0.21
Total by-product credits	1,057.8	4.06	967.4	3.18
Reconciliation to IFRS:
Cash cost, net of by-product credits	(56.5)		139.9
By-product credits	1,057.8		967.4
Treatment and refining charges	(28.4)		(97.3)
Inventory adjustments	4.1		2.9
Share-based compensation expense	5.9		1.9
Past service costs	-		4.3
Change in product inventory	8.1		11.4
Royalties	9.3		10.3
Overhead costs incurred during Manitoba temporary suspension (cash)	19.2		-
Overhead costs incurred during Peru temporary suspension (cash)	8.6		-
Depreciation and amortization4	439.7		426.6
Cost of sales5	1,467.8		1,467.4

¹ Per pound of copper produced.

² By-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 44 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 year ended December 31, 2025 the variable consideration adjustments amounted to a gain of $9.9 million (year ended December 31, 2024 - loss of $3.8 million).

⁴ Depreciation is based on concentrate sold.

⁵ As per consolidated financial statements.

66

Peru	Three months ended			Year ended
(in thousands)	Dec. 31, 2025	Sep. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Net pounds of copper produced1	55,199	39,934	74,931	187,734	218,260
1 Contained copper in concentrate.

Peru	Three months ended
	Dec. 31, 2025		Sep. 30, 2025		Dec. 31, 2024
Cash cost per pound of copper produced	$ millions	$/lb	$ millions	$/lb	$ millions	$/lb
Mining	37.6	0.68	34.8	0.87	47.3	0.63
Milling	52.0	0.94	40.8	1.02	53.6	0.72
G&A	47.8	0.87	19.3	0.48	33.2	0.44
Onsite costs	137.4	2.49	94.9	2.37	134.1	1.79
Treatment & refining	2.5	0.05	3.4	0.08	16.0	0.21
Freight & other	17.3	0.31	9.4	0.24	19.2	0.25
Cash cost, before by-product credits	157.2	2.85	107.7	2.69	169.3	2.25
By-product credits	(126.0)	(2.28)	(55.5)	(1.39)	(94.0)	(1.25)
Cash cost, net of by-product credits	31.2	0.57	52.2	1.30	75.3	1.00

Peru	Year ended
	Dec. 31, 2025		Dec. 31, 2024
Cash cost per pound of copper produced	$ millions	$/lb	$ millions	$/lb
Mining	131.5	0.70	145.5	0.67
Milling	195.0	1.04	197.1	0.90
G&A	112.8	0.60	95.5	0.44
Onsite costs	439.3	2.34	438.1	2.01
Treatment & refining	12.5	0.07	53.4	0.24
Freight & other	54.3	0.29	62.5	0.29
Cash cost, before by-product credits	506.1	2.70	554.0	2.54
By-product credits	(303.5)	(1.62)	(295.8)	(1.36)
Cash cost, net of by-product credits	202.6	1.08	258.2	1.18

67

Peru	Three months ended
	Dec. 31, 2025		Sep. 30, 2025		Dec. 31, 2024
Supplementary cash cost information	$ millions	$/lb 1	$ millions	$/lb 1	$ millions	$/lb 1
By-product credits2:
Gold3	104.7	1.90	31.3	0.78	68.5	0.91
Silver3	13.2	0.24	7.0	0.18	16.8	0.22
Molybdenum	8.1	0.14	17.2	0.43	8.7	0.12
Total by-product credits	126.0	2.28	55.5	1.39	94.0	1.25
Reconciliation to IFRS:
Cash cost, net of by-product credits	31.2		52.2		75.3
By-product credits	126.0		55.5		94.0
Treatment and refining charges	(2.5)		(3.4)		(16.0)
Inventory adjustments	(0.2)		(1.3)		(0.2)
Share-based compensation expenses	0.5		0.2		0.1
Change in product inventory	15.6		(26.9)		(6.7)
Royalties	2.9		1.5		1.5
Overhead costs incurred during Peru temporary suspension (cash)	1.3		7.3		-
Depreciation and amortization4	115.8		50.0		83.2
Cost of sales5	290.6		135.1		231.2

¹ Per pound of copper produced.

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

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

⁴ Depreciation is based on concentrate sold.

⁵ As per the consolidated financial statements.

68

Peru	Year ended
	Dec. 31, 2025		Dec. 31, 2024
Supplementary cash cost information	$ millions	$/lb 1	$ millions	$/lb 1
By-product credits2:
Gold3	188.3	1.00	182.5	0.84
Silver3	49.5	0.26	51.3	0.24
Molybdenum	65.7	0.36	62.0	0.28
Total by-product credits	303.5	1.62	295.8	1.36
Reconciliation to IFRS:
Cash cost, net of by-product credits	202.6		258.2
By-product credits	303.5		295.8
Treatment and refining charges	(12.5)		(53.4)
Inventory adjustments	-		-
Share-based compensation expenses	1.0		0.5
Change in product inventory	6.5		9.6
Royalties	6.5		6.7
Overhead costs incurred during Peru temporary suspension (cash)	8.6		-
Depreciation and amortization4	290.0		270.3
Cost of sales5	806.2		787.7

¹ Per pound of copper produced.

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

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

⁴ Depreciation is based on concentrate sold.

⁵ As per the consolidated financial statements.

69

British Columbia	Three months ended			Year ended
(in thousands)	Dec. 31, 2025	Sep. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Net pounds of copper produced1	10,373	11,572	13,067	52,435	58,215
1 Contained copper in concentrate.

British Columbia	Three months ended
	Dec. 31, 2025		Sep. 30, 2025		Dec. 31, 2024
Cash cost per pound of copper produced	$ millions	$/lb	$ millions	$/lb	$ millions	$/lb
Mining	26.3	2.54	19.6	1.69	18.2	1.39
Milling	28.3	2.73	29.1	2.52	25.2	1.93
G&A	9.5	0.91	7.1	0.61	4.6	0.35
Onsite costs	64.1	6.18	55.8	4.82	48.0	3.67
Treatment & refining	1.3	0.12	1.0	0.09	3.4	0.26
Freight & other	2.7	0.26	3.0	0.26	2.4	0.19
Cash cost, before by-product credits	68.1	6.56	59.8	5.17	53.8	4.12
By-product credits	(18.1)	(1.74)	(22.7)	(1.96)	(14.6)	(1.12)
Cash cost, net of by-product credits	50.0	4.82	37.1	3.21	39.2	3.00

British Columbia	Year ended
	Dec. 31, 2025		Dec. 31, 2024
Cash cost per pound of copper produced	$ millions	$/lb	$ millions	$/lb
Mining	92.0	1.76	79.1	1.36
Milling	100.6	1.92	89.8	1.54
G&A	29.0	0.55	19.6	0.34
Onsite costs	221.6	4.23	188.5	3.24
Treatment & refining	8.0	0.15	14.4	0.25
Freight & other	12.4	0.23	13.2	0.22
Cash cost, before by-product credits	242.0	4.61	216.1	3.71
By-product credits	(81.3)	(1.55)	(56.5)	(0.97)
Cash cost, net of by-product credits	160.7	3.06	159.6	2.74

70

British Columbia	Three months ended
	Dec. 31, 2025		Sep. 30, 2025		Dec. 31, 2024
Supplementary cash cost information	$ millions	$/lb 1	$ millions	$/lb 1	$ millions	$/lb 1
By-product credits2:
Gold	14.9	1.43	20.4	1.76	13.3	1.02
Silver	3.2	0.31	2.3	0.20	1.3	0.10
Total by-product credits	18.1	1.74	22.7	1.96	14.6	1.12
Reconciliation to IFRS:
Cash cost, net of by-product credits	50.0		37.1		39.2
By-product credits	18.1		22.7		14.6
Treatment and refining charges	(1.3)		(1.0)		(3.4)
Inventory adjustments	0.1		-		1.2
Change in product inventory	(9.1)		4.2		(3.0)
Share-based compensation expense	0.7		0.5		0.4
Royalties	0.3		0.5		0.6
Depreciation and amortization3	14.1		16.4		11.8
Cost of sales4	72.9		80.4		61.4

¹ Per pound of copper produced.

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

³ Depreciation is based on concentrate sold.

⁴ As per consolidated financial statements.

British Columbia	Year ended
	Dec. 31, 2025		Dec. 31, 2024
Supplementary cash cost information	$ millions	$/lb 1	$ millions	$/lb 1
By-product credits2:
Gold	71.2	1.36	49.3	0.85
Silver	10.1	0.19	7.2	0.12
Total by-product credits	81.3	1.55	56.5	0.97
Reconciliation to IFRS:
Cash cost, net of by-product credits	160.7		159.6
By-product credits	81.3		56.5
Treatment and refining charges	(8.0)		(14.4)
Inventory adjustments	2.3		1.2
Change in product inventory	(2.1)		3.8
Share-based compensation expense	1.7		0.4
Royalties	2.8		3.6
Depreciation and amortization3	63.3		50.1
Cost of sales4	302.0		260.8

¹ Per pound of copper produced.

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

³ Depreciation is based on concentrate sold.

⁴ As per consolidated financial statements.

71

Consolidated	Three months ended
	Dec. 31, 2025		Sep. 30, 2025		Dec. 31, 2024
All-in sustaining cash cost per pound of copper produced	$ millions	$/lb	$ millions	$/lb	$ millions	$/lb
Cash cost, net of by-product credits	(46.0)	(0.63)	22.2	0.42	43.1	0.45
Cash sustaining capital expenditures	111.2	1.53	87.5	1.64	85.3	0.89
Royalties	3.2	0.04	2.0	0.03	2.1	0.03
Sustaining cash cost, net of by-product credits	68.4	0.94	111.7	2.09	130.5	1.37
Corporate selling and administrative expenses & regional costs	32.0	0.44	33.0	0.62	11.6	0.12
Accretion and amortization of decommissioning and community agreements1	4.0	0.05	3.9	0.07	3.7	0.04
All-in sustaining cash cost, net of by-product credits	104.4	1.43	148.6	2.78	145.8	1.53
Reconciliation to property, plant and equipment additions:
Property, plant and equipment additions	140.9		97.6		127.6
Capitalized stripping net additions	43.9		43.2		35.8
Total accrued capital additions	184.8		140.8		163.4
Less other non-sustaining capital costs2	93.0		69.6		91.8
Total sustaining capital costs	91.8		71.2		71.6
Capitalized lease & equipment financing cash payments - operating sites	12.5		14.3		10.3
LOM Community agreement cash payments	4.4		-		0.7
Accretion and amortization of decommissioning and restoration obligations 3	2.5		2.0		2.7
Cash sustaining capital expenditures	111.2		87.5		85.3

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

² Other 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.

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

72

Consolidated	Year ended
	Dec. 31, 2025		Dec. 31, 2024
All-in sustaining cash cost per pound of copper produced	$ millions	$/lb	$ millions	$/lb
Cash cost, net of by-product credits	(56.5)	(0.22)	139.9	0.46
Cash sustaining capital expenditures	385.2	1.48	342.2	1.13
Royalties	9.3	0.04	10.3	0.03
Sustaining cash cost, net of by-product credits	338.0	1.30	492.4	1.62
Corporate selling and administrative expenses & regional costs	102.4	0.39	62.4	0.20
Accretion and amortization of decommissioning and community agreements1	13.1	0.05	17.3	0.06
All-in sustaining cash cost, net of by-product credits	453.5	1.74	572.1	1.88
Reconciliation to property, plant and equipment additions:
Property, plant and equipment additions	400.3		325.7
Capitalized stripping net additions	182.2		160.5
Total accrued capital additions	582.5		486.2
Less other non-sustaining capital costs2	268.4		193.1
Total sustaining capital costs	314.1		293.1
Capitalized lease & equipment financing cash payments - operating sites	53.0		38.4
LOM Community agreement cash payments	9.3		2.5
Accretion and amortization of decommissioning and restoration obligations 3	8.8		8.2
Cash sustaining capital expenditures	385.2		342.2

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

² Other 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.

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

73

Peru	Three months ended
	Dec. 31, 2025		Sep. 30, 2025		Dec. 31, 2024
Sustaining cash cost per pound of copper produced	$ millions	$/lb	$ millions	$/lb	$ millions	$/lb
Cash cost, net of by-product credits	31.2	0.57	52.2	1.30	75.3	1.00
Cash sustaining capital expenditures	50.3	0.91	30.5	0.77	34.3	0.46
Royalties	2.9	0.05	1.5	0.04	1.5	0.02
Sustaining cash cost per pound of copper produced	84.4	1.53	84.2	2.11	111.1	1.48

Peru	Year ended
	Dec. 31, 2025		Dec. 31, 2024
Sustaining cash cost per pound of copper produced	$ millions	$/lb	$ millions	$/lb
Cash cost, net of by-product credits	202.6	1.08	258.2	1.18
Cash sustaining capital expenditures	171.2	0.91	141.6	0.65
Royalties	6.5	0.03	6.7	0.03
Sustaining cash cost per pound of copper produced	380.3	2.02	406.5	1.86

British Columbia	Three months ended
	Dec. 31, 2025		Sep. 30, 2025		Dec. 31, 2024
Sustaining cash cost per pound of copper produced	$ millions	$/lb	$ millions	$/lb	$ millions	$/lb
Cash cost, net of by-product credits	50.0	4.82	37.1	3.21	39.2	3.00
Cash sustaining capital expenditures	41.7	4.02	48.4	4.18	35.4	2.71
Royalties	0.3	0.03	0.5	0.04	0.6	0.05
Sustaining cash cost per pound of copper produced	92.0	8.87	86.0	7.43	75.2	5.76

British Columbia	Year ended
	Dec. 31, 2025		Dec. 31, 2024
Sustaining cash cost per pound of copper produced	$ millions	$/lb	$ millions	$/lb
Cash cost, net of by-product credits	160.7	3.06	159.6	2.74
Cash sustaining capital expenditures	157.5	3.00	144.5	2.48
Royalties	2.8	0.06	3.6	0.07
Sustaining cash cost per pound of copper produced	321.0	6.12	307.7	5.29

74

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 December 31, and September 30, 2025 and December 31, 2024 and year ended December 31, 2025 and 2024. 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			Year ended
(in thousands)	Dec. 31, 2025	Sep. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Net ounces of gold produced1	47,423	22,441	51,438	173,453	214,225
1 Contained gold in concentrate and doré.

Manitoba	Three months ended
	Dec. 31, 2025		Sep. 30, 2025		Dec. 31, 2024
Cash cost per ounce of gold produced	$ millions	$/oz1	$ millions	$/oz1	$ millions	$/oz1
Mining	39.3	829	15.8	704	42.6	828
Milling	16.2	342	5.9	263	16.6	323
G&A	16.1	339	5.4	241	12.8	249
Onsite costs	71.6	1,510	27.1	1,208	72.0	1,400
Treatment & refining	2.0	42	0.9	40	6.5	126
Freight & other	5.1	108	2.5	111	7.0	136
Cash cost, before by-product credits	78.7	1,660	30.5	1,359	85.5	1,662
By-product credits	(45.3)	(955)	(22.0)	(980)	(54.3)	(1,055)
Gold cash cost, net of by-product credits	33.4	705	8.5	379	31.2	607

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Manitoba	Year ended
	Dec. 31, 2025		Dec. 31, 2024
Cash cost per ounce of gold produced	$ millions	$/oz1	$ millions	$/oz1
Mining	126.9	731	169.4	791
Milling	49.9	288	65.2	304
G&A	50.1	289	47.7	223
Onsite costs	226.9	1,308	282.3	1,318
Treatment & refining	7.9	45	29.5	137
Freight & other	18.4	106	25.4	119
Cash cost, before by-product credits	253.2	1,459	337.2	1,574
By-product credits	(157.9)	(910)	(207.3)	(968)
Gold cash cost, net of by-product credits	95.3	549	129.9	606

Manitoba	Three months ended
Supplementary cash cost information	Dec. 31, 2025		Sep. 30, 2025		Dec. 31, 2024
	$ millions	$/oz 1	$ millions	$/oz1	$ millions	$/oz 1
By-product credits2:
Copper	22.1	466	7.4	330	28.5	554
Zinc	12.2	257	9.9	441	16.1	313
Silver	10.8	228	4.7	209	8.5	165
Other	0.2	4	-	-	1.2	23
Total by-product credits	45.3	955	22.0	980	54.3	1,055
Reconciliation to IFRS:
Cash cost, net of by-product credits	33.4		8.5		31.2
By-product credits	45.3		22.0		54.3
Treatment and refining charges	(2.0)		(0.9)		(6.5)
Past service costs	-		-		1.5
Share-based compensation expenses	1.4		1.0		0.2
Inventory adjustments	0.8		-		0.3
Change in product inventory	(2.2)		3.1		(0.3)
Overhead costs incurred during Manitoba temporary suspension (cash)	-		16.0		-
Depreciation and amortization3	22.6		16.3		27.2
Cost of sales4	99.3		66.0		107.9
1 Per ounce of gold produced.
2 By-product credits are computed as revenue per financial statements, amortization of deferred revenue and pricing and volume adjustments.
3 Depreciation is based on concentrate sold.
4 As per consolidated financial statements.

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Manitoba	Year ended
Supplementary cash cost information	Dec. 31, 2025		Dec. 31, 2024
	$ millions	$/oz 1	$ millions	$/oz 1
By-product credits2:
Copper	83.6	482	108.2	505
Zinc	43.2	249	69.9	326
Silver	31.1	179	27.5	128
Other	-	-	1.7	9
Total by-product credits	157.9	910	207.3	968
Reconciliation to IFRS:
Cash cost, net of by-product credits	95.3		129.9
By-product credits	157.9		207.3
Treatment and refining charges	(7.9)		(29.5)
Past service costs	-		4.3
Share-based compensation expenses	3.2		1.0
Inventory adjustments	1.8		1.7
Change in product inventory	3.7		(2.0)
Overhead costs incurred during Manitoba temporary suspension (cash)	19.2		-
Depreciation and amortization3	86.4		106.2
Cost of sales4	359.6		418.9
1 Per ounce of gold produced.
2 By-product credits are computed as revenue per financial statements, amortization of deferred revenue and pricing and volume adjustments.
3 Depreciation is based on concentrate sold.
4 As per consolidated financial statements.

Manitoba	Three months ended
	Dec. 31, 2025		Sep. 30, 2025		Dec. 31, 2024
Sustaining cash cost per ounce of gold produced	$ millions	$/oz	$ millions	$/oz	$ millions	$/oz
Gold cash cost, net of by-product credits	33.4	705	8.5	379	31.2	607
Cash sustaining capital expenditures	19.2	405	8.6	383	15.5	301
Sustaining cash cost per ounce of gold produced	52.6	1,110	17.1	762	46.7	908

Manitoba	Year ended
	Dec. 31, 2025		Dec. 31, 2024
Sustaining cash cost per ounce of gold produced	$ millions	$/oz	$ millions	$/oz
Gold cash cost, net of by-product credits	95.3	549	129.9	606
Cash sustaining capital expenditures	56.5	326	56.1	262
Sustaining cash cost per ounce of gold produced	151.8	875	186.0	868

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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 December 31, 2025 and 2024 and September 30, 2025 and year ended December 31, 2025 and 2024.

Peru	Three months ended			Year ended
(in millions except ore tonnes milled and unit cost per tonne)	Dec. 31, 2025	Sept. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Combined unit cost per tonne processed
Mining	37.6	34.8	47.3	131.5	145.5
Milling	52.0	40.8	53.6	195.0	197.1
G&A1	47.8	19.3	33.2	112.8	95.5
Less: Other G&A2	(26.7)	(3.8)	(12.1)	(44.9)	(25.9)
Unit cost	110.7	91.1	122.0	394.4	412.2
Tonnes ore milled (in thousands)	7,628	6,992	7,999	30,293	31,934
Combined unit cost per tonne	14.51	13.03	15.25	13.02	12.91
Reconciliation to IFRS:
Unit cost	110.7	91.1	122.0	394.4	412.2
Freight & other	17.3	9.4	19.2	54.3	62.5
Other G&A	26.7	3.8	12.1	44.9	25.9
Share-based compensation expenses	0.5	0.2	0.1	1.0	0.5
Inventory adjustments	(0.2)	(1.3)	(0.2)	-	-
Change in product inventory	15.6	(26.9)	(6.7)	6.5	9.6
Royalties	2.9	1.5	1.5	6.5	6.7
Overhead costs incurred during Peru temporary suspension (cash)	1.3	7.3	-	8.6	-
Depreciation and amortization	115.8	50.0	83.2	290.0	270.3
Cost of sales3	290.6	135.1	231.2	806.2	787.7
1 G&A as per cash cost reconciliation above.
2 Other G&A primarily includes profit sharing costs.
4 As per consolidated financial statements.

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Manitoba	Three months ended			Year ended
(in millions except tonnes ore milled and unit cost per tonne)	Dec. 31, 2025	Sept. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Combined unit cost per tonne processed
Mining	39.3	15.8	42.6	126.9	169.4
Milling	16.2	5.9	16.6	49.9	65.2
G&A1	16.1	5.4	12.8	50.1	47.7
Less: Other G&A related to profit sharing costs	(9.4)	(1.8)	(4.0)	(25.6)	(17.0)
Unit cost	62.2	25.3	68.0	201.3	265.3
USD/CAD implicit exchange rate	1.39	1.39	1.39	1.40	1.37
Unit cost - C$	86.7	35.3	95.0	282.4	363.5
Tonnes ore milled	349,082	136,705	407,596	1,197,335	1,608,708
Combined unit cost per tonne - C$	248	258	233	236	226
Reconciliation to IFRS:
Unit cost	62.2	25.3	68.0	201.3	265.3
Freight & other	5.1	2.5	7.0	18.4	25.4
Other G&A related to profit sharing	9.4	1.8	4.0	25.6	17.0
Share-based compensation expenses	1.4	1.0	0.2	3.2	1.0
Inventory adjustments	0.8	-	0.3	1.8	1.7
Past service costs	-	-	1.5	-	4.3
Change in product inventory	(2.2)	3.1	(0.3)	3.7	(2.0)
Overhead costs incurred during Manitoba temporary suspension (cash)	-	16.0	-	19.2	-
Depreciation and amortization	22.6	16.3	27.2	86.4	106.2
Cost of sales2	99.3	66.0	107.9	359.6	418.9
1 G&A as per cash cost reconciliation above.
2 As per consolidated financial statements.

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British Columbia	Three months ended			Year ended
(in millions except tonnes ore milled and unit cost per tonne)	Dec. 31, 2025	Sept. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Combined unit cost per tonne processed
Mining	26.3	19.6	18.2	92.0	79.1
Milling	28.3	29.1	25.2	100.6	89.8
G&A1	9.5	7.1	4.6	29.0	19.6
Unit cost	64.1	55.8	48.0	221.6	188.5
USD/CAD implicit exchange rate	1.41	1.38	1.38	1.40	1.37
Unit cost - C$	90.3	77.3	66.9	309.7	258.1
Tonnes ore milled	2,268	3,087	2,881	11,017	12,657
Combined unit cost per tonne - C$	39.80	25.02	23.22	28.12	20.39
Reconciliation to IFRS:
Unit cost	64.1	55.8	48.0	221.6	188.5
Freight & other	2.7	3.0	2.4	12.4	13.2
Change in product inventory	(9.1)	4.2	(3.0)	(2.1)	3.8
Shared based compensation	0.7	0.5	0.4	1.7	0.4
Inventory adjustments	0.1	-	1.2	2.3	1.2
Royalties	0.3	0.5	0.6	2.8	3.6
Depreciation and amortization	14.1	16.4	11.8	63.3	50.1
Cost of sales2	72.9	80.4	61.4	302.0	260.8
1 G&A as per cash cost reconciliation above.
2 As per consolidated financial statements.

ACCOUNTING CHANGES

New standards and interpretations not yet adopted

For information on new standards and interpretations not yet adopted, refer to note 4 of Hudbay's December 31, 2025 consolidated financial statements.

CRITICAL ACCOUNTING JUDGEMENTS AND ESTIMATES

The preparation of the consolidated financial statements in conformity with IFRS requires us 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 financial statements, and reported amounts of revenue and expenses during the reporting period. Actual results may differ from these estimates.

The Company review these estimates and underlying assumptions on an ongoing basis based on its experience and other factors, including expectations of future events that Hudbay believe 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 the Company's financial condition and results of operations because they require management to make subjective and/or complex judgements 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.

The following are significant judgements and estimates impacting the consolidated financial statements:

- Judgements and estimates that affect multiple areas of the consolidated financial statements:

- Mineral reserves and resources which form the basis of life of mine plans which are utilized in impairment testing, timing of payments related to decommissioning obligations and depreciation of capital assets. The Company estimate its mineral reserves and resources based on information compiled by qualified persons as defined in accordance with NI 43-101;

- Income and mining taxes, including estimates of future taxable profit which impacts the ability to realize deferred tax assets on the Company's balance sheet; and

80

- In respect of the outcome of uncertain future events as it concerns recognizing contingent liabilities.

- Judgements and estimates that relate mainly to assets (these judgements may also affect other areas of the consolidated financial statements):

- Property, plant and equipment:

- Cost allocations for mine development;

- Mining properties expenditures capitalized;

- Classification of supply costs as related to capital development or inventory acquisition;

- Determining when exploration and evaluation assets should be transferred to capital works in progress within property, plant and equipment;

- Determination of when an asset or group of assets is in the condition and location to be ready for use as intended by management for the purposes of commencing depreciation;

- Componentization;

- Assessment of impairment, including determination of cash generating units and assessing for indicators of impairment;

- Recoverability of exploration and evaluation assets, including determination of cash generating units and assessing for indications of impairment;

- Units of production depreciation;

- Plant and equipment estimated useful lives and residual values;

- Capitalized stripping costs; and

- Finite life intangible assets.

- Impairment (and reversal of impairment) of non-financial assets:

- Future production levels and timing;

- Operating and capital costs;

- Future commodity prices;

- Purchase offers;

- Foreign exchange rates; and

- Risk adjusted discount rates.

- In process inventory quantities, inventory cost allocations and inventory valuation.

- Judgements and estimates that relate mainly to liabilities (these judgements may also affect other areas of the consolidated financial statements):

- Determination of deferred revenue per unit related to the precious metals stream transactions and determination of current portion of deferred revenue, which is based on timing of future sales, and adjustments of the expected conversion of resource to reserves;

- Pensions and other employee benefits; and

- Decommissioning, restoration and similar liabilities including estimated future costs and timing of spending.

- Estimates that relate mainly to the consolidated statements of income:

- Assaying used to determine revenues and recoverability of inventories.

For more information on judgements and estimates, refer to note 2 of Hudbay's consolidated financial statements for the year ended December 31, 2025.

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DISCLOSURE CONTROLS AND PROCEDURES AND INTERNAL CONTROL OVER FINANCIAL REPORTING

Disclosure controls and procedures ("DC&P")

Management is responsible for establishing and maintaining adequate DC&P. As of December 31, 2025, the Company have evaluated the effectiveness of the design and operation of its DC&P in accordance with requirements of National Instrument 52-109 of the Canadian Securities Commission ("NI 52-109") and the Sarbanes Oxley Act of 2002 (as adopted by the US Securities and Exchange Commission). The Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO") supervised and participated in this evaluation.

As of December 31, 2025, based on management's evaluation, the CEO and CFO concluded that the Company's DC&P were effective to ensure that information required to be disclosed by Hudbay in reports it files or submits is recorded, processed, summarized and reported within the time periods specified in securities legislation and is accumulated and communicated to the Company's management, including the CEO and CFO, to allow timely decisions regarding required disclosure.

Internal control over financial reporting ("ICFR")

Management of Hudbay is responsible for establishing and maintaining adequate ICFR. Under the supervision and with the participation of the Chief Executive Officer and Chief Financial Officer, the Company evaluated the effectiveness of its ICFR as of December 31, 2025 based upon the Internal Control - Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. Based on management's evaluation, the CEO and CFO concluded that its ICFR was effective as of December 31, 2025.

The effectiveness of the Company's ICFR as of December 31, 2025 has been audited by Deloitte LLP, Independent Registered Public Accounting Firm as stated in their report immediately preceding the Company's consolidated financial statements for the year ended December 31, 2025.

Changes in ICFR

Hudbay did not make any changes to ICFR during the year ended December 31, 2025 that materially affected, or are reasonably likely to materially affect, the Company's ICFR.

Inherent limitations of controls and procedures

All internal control systems, no matter how well designed, have inherent limitations. As a result, even systems determined to be effective may not prevent or detect misstatements on a timely basis, as systems can provide only reasonable assurance that the objectives of the control system are met. In addition, projections of any evaluation of the effectiveness of ICFR to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may change.

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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 ongoing second SAG mill conversion and configuration project and 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 permitting and development timelines associated with New Ingerbelle, the estimated timelines and pre-requisites for sanctioning the Copper World project, expectations regarding the anticipated benefits of the JV Transaction and the sanctioning of the Copper World project to Hudbay and the United States, the consummation and timing of the DFS in respect 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, 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 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 tax synergies, expectations regarding the ability to conduct exploration work and execute on exploration programs on its properties and to advance related drill plans, including the advancement of the exploration program at Maria Reyna and Caballito and the status and anticipated timing of the related drill permit application process, expectations regarding the prospective nature of the Maria Reyna and Caballito properties, 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, the enhancement of stakeholder engagement and advancement of a pre-feasibility study and related test work at the Mason copper project in Nevada, 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 any successful challenges to the Copper World permits;

- Hudbay's ability to successfully advance and complete the optimization of the Copper Mountain operations, obtain required permits 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;

83

- 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 associated with reaching a definitive agreement with Wheaton in respect of the enhanced precious metals stream, risks related to the failure to effectively advance and complete the optimization of the Copper Mountain mine operations including with respect to the ongoing second SAG mill conversion and configuration project and 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 related to the Copper World project, including in relation to project delivery 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, 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.

84

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, Director, Global Exploration and 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.

85

SUMMARY OF HISTORICAL RESULTS

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

		2025 4	Q4 2025	Q3 2025	Q2 2025	Q1 2025	2024 4	Q4 2024	Q3 2024	Q2 2024	Q1 2024	2023 4	Q4 2023
Consolidated Financial Condition ($ millions)
Cash and cash equivalents and short-term investment		$568.9	$568.9	$611.1	$625.5	$582.6	$581.8	$581.8	$483.3	$523.8	$284.4	$249.8	$249.8
Total long-term debt		1,008.6	1,008.6	1,047.0	1,059.6	1,108.7	1,107.5	1,107.5	1,108.9	1,155.6	1,278.6	1,287.5	1,287.5
Net debt1		439.7	439.7	435.9	434.1	526.1	525.7	525.7	625.6	631.8	994.2	1,037.7	1,037.7
Free cash flow		387.9	228.2	(15.2)	87.8	87.4	357.1	148.9	88.4	32.5	87.2	320.2	160.5
Consolidated Financial Performance ($ millions except per share amounts)
Revenue		$2,211.0	$732.9	$346.8	$536.4	$594.9	$2,021.2	$584.9	$485.8	$425.5	$525.0	$1,690.0	$602.2
Cost of sales		1,467.8	462.8	281.5	359.9	363.6	1,467.4	400.5	346.0	347.9	373.0	1,297.5	405.4
Earnings (loss) before tax		912.0	257.1	330.5	153.1	171.3	251.6	103.7	79.7	0.4	67.8	151.8	81.0
Net (loss) earnings		564.3	128.0	222.4	114.7	99.2	67.8	19.3	50.3	(20.3)	18.5	69.5	33.5
Net (loss) earnings attributable to owners1		568.5	128.0	222.4	117.7	100.4	76.7	21.2	49.7	(16.5)	22.3	66.4	30.7
Basic and diluted (loss) earnings per share		$1.44	$0.32	$0.56	$0.30	$0.25	$0.20	$0.05	$0.13	$(0.04)	$0.06	$0.22	$0.09
Adjusted (loss) earnings per share attributable to owners 1		$0.67	$0.22	$0.03	$0.19	$0.24	$0.48	$0.18	$0.13	$0.00	$0.17	$0.23	$0.20
Operating cash flow before change in non-cash working capital		764.3	336.9	70.3	193.9	163.5	691.1	231.5	188.3	123.7	147.5	570.0	246.5
Adjusted EBITDA 1		1,060.9	385.9	142.6	245.2	287.2	823.3	257.3	206.0	145.0	215.0	647.8	274.4
Consolidated Operational Performance
Contained metal in concentrate and doré produced 2
Copper	tonnes	118,188	33,069	24,205	29,956	30,958	137,943	43,262	31,354	28,578	34,749	131,691	45,450
Gold	ounces	267,934	84,298	53,581	56,271	73,784	332,240	94,161	89,073	58,614	90,392	310,429	112,776
Silver	ounces	3,468,143	1,002,985	730,394	814,989	919,775	3,983,851	1,311,658	985,569	738,707	947,917	3,575,234	1,197,082
Zinc	tonnes	17,646	5,703	548	5,130	6,265	33,339	8,385	8,069	8,087	8,798	34,642	5,747
Molybdenum	tonnes	1,282	325	185	375	397	1,323	195	362	369	397	1,566	397
Payable metal in concentrate and doré sold
Copper	tonnes	114,534	34,132	18,280	30,354	31,768	125,094	37,927	27,760	25,799	33,608	124,996	44,006
Gold	ounces	260,261	84,424	38,279	62,466	75,092	335,342	92,734	73,232	61,295	108,081	276,893	104,840
Silver	ounces	3,190,552	871,006	418,418	894,160	1,006,968	3,549,816	1,150,518	663,413	667,036	1,068,848	3,145,166	1,048,877
Zinc 3	tonnes	15,152	3,972	3,452	2,871	4,857	25,120	5,261	8,607	5,133	6,119	28,779	7,385
Molybdenum	tonnes	1,334	190	269	427	448	1,287	182	343	347	415	1,462	468
Cash cost 1	$/lb	$(0.22)	$(0.63)	$0.42	$(0.02)	$(0.45)	$0.46	$0.45	$0.18	$1.14	$0.16	$0.80	$0.16
Sustaining cash cost 1	$/lb	$1.30	$0.94	$2.09	$1.65	$0.72	$1.62	$1.37	$1.71	$2.65	$1.00	$1.72	$1.09
All-in sustaining cash cost 1	$/lb	$1.74	$1.43	$2.78	$2.03	$0.97	$1.88	$1.53	$1.95	$3.07	$1.29	$1.92	$1.31

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

86

		2025 4	Q4 2025	Q3 2025	Q2 2025	Q1 2025	2024 4	Q4 2024	Q3 2024	Q2 2024	Q1 2024	2023 4	Q4 2023
Peru Operations
Constancia ore mined1	tonnes	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	2,559,547	9,265,954	973,176
Copper	%	0.31	0.31	0.25	0.34	0.28	0.34	0.40	0.36	0.29	0.31	0.32	0.30
Gold	g/tonne	0.03	0.03	0.02	0.03	0.03	0.04	0.04	0.04	0.03	0.04	0.04	0.04
Silver	g/tonne	3.18	3.27	1.92	3.26	3.14	3.08	3.88	3.20	2.50	2.79	2.53	2.26
Molybdenum	%	0.02	0.01	0.01	0.02	0.02	0.01	0.02	0.02	0.01	0.01	0.01	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	2,214,354	14,756,416	5,556,613
Copper	%	0.40	0.43	0.38	0.26	0.44	0.55	0.63	0.48	0.41	0.56	0.51	0.56
Gold	g/tonne	0.29	0.27	0.31	0.24	0.26	0.32	0.38	0.27	0.20	0.32	0.33	0.32
Silver	g/tonne	4.78	4.84	4.87	4.59	3.68	5.61	6.43	6.23	3.83	4.64	4.28	4.84
Molybdenum	%	0.01	0.01	0.01	0.01	0.01	0.01	0.00	0.01	0.02	0.02	0.01	0.01
Strip Ratio		1.04	0.57	1.38	1.47	1.02	1.78	1.22	2.62	1.74	1.95	1.51	1.26
Ore milled	tonnes	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	8,077,962	30,720,929	7,939,044
Copper	%	0.33	0.39	0.31	0.34	0.30	0.36	0.48	0.32	0.30	0.36	0.39	0.48
Gold	g/tonne	0.11	0.18	0.16	0.05	0.05	0.14	0.20	0.11	0.07	0.15	0.16	0.25
Silver	g/tonne	3.72	4.19	3.94	3.58	3.22	3.84	5.28	3.70	2.85	3.48	3.62	4.20
Molybdenum	%	0.01	0.01	0.01	0.01	0.01	0.01	0.01	0.01	0.01	0.01	0.01	0.01
Copper recovery	%	84.3	84.5	83.2	84.5	84.6	85.0	87.8	82.6	83.1	84.9	84.2	87.4
Gold recovery	%	69.2	74.7	72.1	56.0	56.5	70.7	73.3	68.1	61.4	73.4	71.8	77.6
Silver recovery	%	66.7	71.1	65.2	63.5	66.0	68.8	71.4	67.0	63.9	70.7	70.0	78.0
Molybdenum	%	37.4	38.8	33.9	38.7	35.7	41.7	37.1	39.0	46.3	43.2	35.8	33.6
Contained metal in concentrate
Copper	tonnes	85,155	25,038	18,114	21,710	20,293	99,001	33,988	21,220	19,217	24,576	100,487	33,207
Gold	ounces	74,480	32,865	26,380	7,366	7,869	98,226	38,079	20,331	10,672	29,144	114,218	49,418
Silver	ounces	2,415,134	731,017	577,446	551,979	554,692	2,708,262	969,502	648,209	450,833	639,718	2,505,229	836,208
Molybdenum	tonnes	1,282	325	185	375	397	1,323	195	362	369	397	1,566	397
Payable metal sold
Copper	tonnes	84,438	28,361	11,769	21,418	22,890	88,138	28,775	18,803	16,806	23,754	96,213	31,200
Gold	ounces	71,755	37,874	9,798	9,721	14,362	103,364	37,459	9,795	13,433	42,677	97,176	38,114
Silver	ounces	2,239,832	650,384	258,215	616,578	714,654	2,343,820	824,613	365,198	400,302	753,707	2,227,419	703,679
Molybdenum	tonnes	1,334	190	269	427	448	1,287	182	343	347	415	1,462	468
Unit cost 2,3	$/tonne	$13.02	$14.51	$13.03	$13.59	$11.09	$12.91	$15.25	$12.78	$12.68	$10.92	$12.47	$12.24
Peru cash cost3	$/lb	$1.08	$0.57	$1.30	$1.45	$1.11	$1.18	$1.00	$1.80	$1.78	$0.43	$1.07	$0.54
Peru sustaining cash cost3	$/lb	$2.02	$1.53	$2.11	$2.63	$1.92	$1.86	$1.48	$2.78	$2.60	$1.02	$1.81	$1.21

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

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

³ 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 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.

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

87

		2025 1	Q4 2025	Q3 2025	Q2 2025	Q1 2025	2024 1	Q4 2024	Q3 2024	Q2 2024	Q1 2024	2023 1	Q4 2023
Manitoba Operations
Lalor ore mined	tonnes	1,180,121	353,819	139,006	303,062	384,234	1,626,935	422,454	411,295	385,478	407,708	1,526,729	372,384
Gold	g/tonne	5.35	5.51	5.42	4.97	5.46	4.68	4.61	5.45	3.75	4.84	4.74	5.92
Copper	%	0.79	0.82	0.67	0.61	0.95	0.85	0.95	0.91	0.69	0.84	0.86	1.04
Zinc	%	2.41	2.55	1.93	2.46	2.42	2.84	2.95	2.73	2.76	2.92	3.00	2.20
Silver	g/tonne	30.43	29.52	31.57	29.94	31.23	27.14	31.91	30.45	22.29	23.44	24.51	28.92
Stall Concentrator:
Ore milled	tonnes	572,704	169,274	43,940	144,204	215,286	893,510	222,004	222,621	229,527	219,358	965,567	228,799
Gold	g/tonne	3.45	3.24	3.10	3.19	3.86	3.42	3.36	4.23	3.02	3.07	3.45	4.22
Copper	%	0.67	0.69	0.56	0.56	0.76	0.71	0.73	0.89	0.59	0.64	0.74	0.73
Zinc	%	3.90	4.32	3.61	4.20	3.44	4.33	4.62	4.12	4.05	4.54	4.36	3.20
Silver	g/tonne	28.31	24.97	31.04	29.55	29.53	26.54	29.90	30.20	21.74	24.46	24.19	28.63
Gold recovery	%	70.1	71.3	72.6	67.9	70.1	68.6	69.6	70.5	65.5	68.0	64.8	67.5
Copper recovery	%	86.7	86.5	83.4	84.7	88.3	87.4	84.4	88.3	85.4	91.7	90.4	92.0
Zinc recovery	%	79.0	78.0	34.6	84.8	84.7	86.2	81.7	88.1	87.1	88.4	82.2	78.5
Silver recovery	%	55.4	55.6	50.3	51.9	58.7	56.8	55.1	57.8	54.2	59.8	61.4	61.8
New Britannia Concentrator:
Ore milled	tonnes	624,631	179,808	92,765	162,934	189,124	715,198	185,592	191,298	167,899	170,409	596,912	165,038
Gold	g/tonne	6.87	6.68	6.88	6.48	7.37	6.29	5.99	6.77	5.31	7.03	6.76	8.03
Copper	%	0.95	1.08	0.76	0.65	1.18	1.04	1.17	0.93	0.94	1.13	1.03	1.46
Zinc	%	1.09	1.30	1.00	1.01	1.00	0.99	1.08	1.12	0.92	0.82	0.84	0.85
Silver	g/tonne	31.75	31.17	32.18	30.29	33.35	27.78	33.97	30.24	24.42	21.60	25.11	27.97
Gold recovery - concentrate and doré	%	89.8	88.6	91.8	89.4	90.3	89.7	90.2	90.0	90.0	88.6	88.6	89.0
Copper recovery	%	89.2	88.6	90.0	87.4	90.3	93.6	91.3	92.8	94.4	96.2	93.3	91.6
Silver recovery - concentrate and doré	%	79.0	77.1	78.5	78.0	81.6	80.9	79.6	79.9	83.1	82.0	81.5	83.2

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

88

		2024 4	Q4 2025	Q3 2025	Q2 2025	Q1 2025	2024 4	Q4 2024	Q3 2024	Q2 2024	Q1 2024	2023 4	Q4 2023
Manitoba Operations (continued)
Total Manitoba contained metal in concentrate and doré produced5
Gold	ounces	173,453	47,423	22,441	43,235	60,354	214,225	51,438	62,468	43,488	56,831	187,363	59,863
Copper	tonnes	9,249	3,326	842	1,612	3,469	12,536	3,347	3,398	2,642	3,149	12,154	3,735
Zinc	tonnes	17,646	5,703	548	5,130	6,265	33,339	8,385	8,069	8,087	8,798	34,642	5,747
Silver	ounces	800,198	214,493	102,132	197,970	285,603	995,090	283,223	281,397	210,647	219,823	851,723	255,579
Total Manitoba payable metal sold in concentrate and doré
Gold	ounces	169,041	43,226	23,118	46,932	55,765	212,243	50,239	57,238	42,763	62,003	171,297	63,635
Copper	tonnes	7,651	2,024	769	2,133	2,725	11,602	3,321	2,931	2,429	2,921	10,708	3,687
Zinc1	tonnes	15,152	3,972	3,452	2,871	4,857	25,120	5,261	8,607	5,133	6,119	28,779	7,385
Silver	ounces	729,314	175,324	112,142	209,594	232,255	956,460	282,158	244,974	197,486	231,841	728,304	246,757
Combined unit cost 2,3	C$/tonne	$236	$248	$258	$241	$214	$226	$233	$211	$225	$235	$217	$216
Gold cash cost 3	$/oz	$549	$705	$379	$710	$376	$606	$607	$372	$771	$736	$727	$434
Sustaining gold cash cost 3	$/oz	$875	$1,110	$762	$1,025	$626	$868	$908	$553	$1,163	$950	$1,077	$788

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.

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

89

		2025	Q4 2025	Q3 2025	Q2 2025	Q1 2025	2024 5	Q4 2024	Q3 2024	Q2 2024	Q1 2024	2023 5	Q4 2023
British Columbia Operations 4
Ore mined1	tonnes	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	3,722,496	6,975,389	2,627,398
Strip Ratio		7.46	7.18	8.84	7.50	6.73	5.98	7.36	6.05	7.61	4.10	3.82	5.34
Ore milled	tonnes	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	3,180,149	6,862,152	3,261,891
Copper	%	0.27	0.26	0.22	0.28	0.33	0.25	0.26	0.24	0.25	0.27	0.35	0.33
Gold	g/tonne	0.09	0.09	0.08	0.09	0.10	0.08	0.09	0.09	0.07	0.07	0.07	0.06
Silver	g/tonne	1.02	1.10	0.78	0.97	1.28	0.96	0.92	0.73	1.01	1.19	1.36	1.36
Copper recovery	%	78.6	78.4	76.6	81.0	78.3	82.4	79.5	84.1	82.3	83.4	79.7	78.8
Gold recovery	%	63.6	63.3	59.2	68.2	63.4	60.5	55.8	67.3	57.2	61.8	55.9	54.1
Silver recovery	%	69.7	71.4	65.5	71.8	69.8	71.8	69.0	71.2	73.9	72.4	73.0	73.8
Contained metal in concentrate produced
Copper	tonnes	23,784	4,705	5,249	6,634	7,196	26,406	5,927	6,736	6,719	7,024	19,050	8,508
Gold	ounces	20,001	4,010	4,760	5,670	5,561	19,789	4,644	6,274	4,454	4,417	8,848	3,495
Silver	ounces	252,811	57,475	50,816	65,040	79,480	280,499	58,933	55,963	77,227	88,376	218,282	105,295
Payable metal
Copper	tonnes	22,445	3,747	5,742	6,803	6,153	25,354	5,831	6,026	6,564	6,933	18,075	9,119
Gold	ounces	19,465	3,324	5,363	5,813	4,965	19,735	5,036	6,199	5,099	3,401	8,420	3,091
Silver	ounces	221,406	45,298	48,061	67,988	60,059	249,536	43,747	53,241	69,248	83,300	189,443	98,441
Combined unit cost 2,3	C$/tonne	$28.12	$39.80	$25.02	$24.51	$25.98	$20.39	$23.22	$15.58	$19.65	$23.67	$21.38	$20.90
Cash cost3	$/lb	$3.06	$4.82	$3.21	$2.39	$2.44	$2.74	$3.00	$1.81	$2.67	$3.49	$2.49	$2.67
Sustaining cash cost 3	$/lb	$6.12	$8.87	$7.43	$5.18	$4.24	$5.29	$5.76	$5.06	$5.56	$4.85	$3.41	$3.93

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

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

³ 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 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.

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.

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	TSX, NYSE - HBM               2026 No. 4
	News Release

Hudbay Delivers Record Fourth Quarter and Full Year 2025 Results; Achieves 2025 Consolidated Copper and Gold Production and Cost Guidance

Toronto, Ontario, February 20, 2026 - Hudbay Minerals Inc. ("Hudbay" or the "Company") (TSX, NYSE: HBM) today released its fourth quarter and full year 2025 financial results and announced 2026 annual production and cost guidance. All amounts are in U.S. dollars, unless otherwise noted. 

"2025 was a transformative year for Hudbay as we delivered record annual revenue of $2.2 billion and exceeded $1 billion in adjusted EBITDA, underpinned by our 11^th consecutive year of meeting consolidated copper production guidance," said Peter Kukielski, President and Chief Executive Officer. "Our diversified operating platform demonstrated exceptional resilience, overcoming external challenges in Manitoba and Peru to generate over $380 million in free cash flow and achieving a third consecutive year of record financial performance. The fourth quarter underscored our commitment to operational excellence. We saw standout performance in Peru driven by high-grade Pampacancha ore, record throughput at the New Britannia mill in Manitoba, and the successful completion of the SAG mill feed system in British Columbia. We are particularly proud to have met our primary production targets for copper and gold while significantly outperforming our twice-improved cost guidance.

"Our prudent strategic financial planning and execution has enabled us to achieve our balance sheet deleveraging goals and lower our cost of capital. We now have the financial flexibility to sanction Copper World in 2026, embark on generational investments in our operating portfolio and commence increases in shareholder returns with our first-ever dividend increase as part of our holistic capital allocation framework. This will allow us to continue to deliver attractive growth and maximize long-term risk-adjusted returns for our stakeholders."

Delivered Record Annual Revenue and Adjusted EBITDA; Achieved 2025 Consolidated Copper and Gold Production and Cost Guidance

• Achieved record annual revenue of $2.2 billion and record annual adjusted EBITDAⁱ of $1.1 billion in 2025, demonstrating the resilience and strength of Hudbay's diversified operating platform.
• Achieved full year consolidated copper and gold production guidance, with 118,188 tonnes of copper and 267,934 ounces of gold, despite mandatory wildfire evacuations in Manitoba and temporary operational interruptions in Peru resulting in production deferrals during the year.
• 2025 represents the 11^th consecutive year in which Hudbay achieved its annual consolidated copper production guidance, since Constancia declared commercial production, and the 5^th consecutive year achieving its annual consolidated gold production guidance, since establishing standalone gold production guidance^v.
• Significantly outperformed the twice-improved 2025 consolidated cash cost guidance driven by strong cost control, higher metal prices and meaningful exposure to gold by-product credits resulting in consolidated cash costⁱ and sustaining cash costⁱ, net of by-product credits, of $(0.22) and $1.30 per pound of copper, respectively, in 2025, an improvement of 148% and 20%, respectively, compared to 2024.

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• Peru operations produced 85,155 tonnes of copper and 74,480 ounces of gold in 2025 with full year copper production within the 2025 guidance range while gold production far exceeded the top end of the annual guidance range. This production output was attributable to the optimization of the mine plan in 2025 by prioritizing Pampacancha mining activities and fully depleting the high-grade satellite deposit in December. Peru also leveraged the use of stockpiled ore during the third quarter of 2025 as the Company adapted its mine plan due to the social unrest experienced in the region. Peru full year cash costⁱ of $1.08 per pound of copper outperformed the low end of the 2025 annual guidance range of $1.35 to $1.65 per pound as a result of stable operating cost performance and higher by-product credits.
• Manitoba operations produced 173,453 ounces of gold, 9,249 tonnes of copper, 17,646 tonnes of zinc and 800,198 ounces of silver in 2025. Production was below the low end of the guidance range for gold and zinc, while copper and silver production was within the guidance range in 2025. These production levels were achieved despite the impacts of over two months of production deferrals due to wildfire evacuations, ramp-up activities throughout the summer and unexpected downtime from an eight-day weather-related power outage in October. In addition, zinc production was lower than the guidance range as gold production was prioritized in Manitoba. Manitoba full year cash costⁱ of $549 per ounce of gold outperformed the low end of the 2025 annual guidance range of $650 to $850 per ounce as a result of productivity gains and lower treatment and refining charges.
• British Columbia operations produced 23,784 tonnes of copper, 20,001 ounces of gold and 252,811 ounces of silver in 2025. Copper production was below the low end of the production guidance range, while the operations achieved full year 2025 production guidance for gold and silver. Copper production in 2025 was impacted by reduced throughput at the primary semi-autogenous grinding ("SAG") mill in the fourth quarter of 2025 and a higher portion of low-grade stockpiles utilized as ore feed in 2025. British Columbia full year cash costⁱ of $3.06 per pound of copper achieved the 2025 annual cost guidance range of $2.45 to $3.45 per pound.

Delivered Strong Fourth Quarter Financial Results Driven by Resilient Operating Performance

• Achieved record quarterly revenue of $732.9 million and record quarterly adjusted EBITDAⁱ of $385.9 million in the fourth quarter of 2025.
• Demonstrated strong operational performance in the fourth quarter of 2025 as operations normalized after temporary production interruptions in the third quarter with consolidated copper production of 33,069 tonnes and consolidated gold production of 84,298 ounces.
• Maintained industry-leading cost performance in the fourth quarter with consolidated cash costⁱ and sustaining cash costⁱ per pound of copper produced, net of by-product credits, of $(0.63) and $0.94, respectively.
• Peru operations had the strongest quarter of the year in the fourth quarter with production of 25,038 tonnes of copper, 32,865 ounces of gold and 731,017 ounces of silver as strong copper and gold grades were mined from Pampacancha and less ore was processed from low-grade stockpiles. Hudbay continued to optimize the mine plan during the quarter with more ore mined from Pampacancha than previously expected, resulting in the accelerated depletion of Pampacancha in late December compared to early 2026. Peru cash costⁱ, net of by-product credits, was $0.57 per pound of copper in the fourth quarter, outperforming the low end of the annual cost guidance range.
• Manitoba operations produced 47,423 ounces of gold in the fourth quarter, slightly lower than quarterly cadence expectations due to unplanned down time in October from an eight-day weather-related power outage, offset by record monthly throughput at the New Britannia mill in December. Manitoba operations also produced 3,326 tonnes of copper, 5,703 tonnes of zinc and 214,493 ounces of silver in the fourth quarter. Manitoba cash costⁱ, net of by-product credits, was $705 per ounce of gold in the fourth quarter, well within the annual cost guidance range.
• British Columbia operations produced 4,705 tonnes of copper, 4,010 ounces of gold and 57,475 ounces of silver in the fourth quarter. While the operations completed construction of the permanent feed system for the new second SAG mill in December, total throughput in the fourth quarter was constrained by the primary SAG mill requiring unplanned maintenance early in the fourth quarter of 2025. British Columbia cash costⁱ, net of by-product credits, was $4.82 per pound of copper in the fourth quarter, reflecting the production impacts from the primary SAG mill maintenance.

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• Fourth quarter net earnings attributable to owners and earnings per share attributable to owners were $128.0 million and $0.32, respectively, reflecting the strong gross margins as a result of higher metal prices and a $25.0 million business interruption insurance recovery related to the mandatory wildfire evacuations in Manitoba during the year. After adjusting for the insurance recovery and other non-cash items, fourth quarter adjusted earningsⁱ per share attributable to owners was $0.22.
• The strong gross margins achieved in the fourth quarter of 2025 resulted in higher employee profit sharing expenses of $36.1 million recorded within cost of sales.

Achieved Deleveraging Targets Ahead of Schedule

• 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 expand margins and generate attractive free cash flow.
• While the majority of Hudbay's revenue continue to be derived from copper production, revenue from gold production continues to represent a growing portion of total revenues at 38% of total revenue in 2025, including 41% of revenue in the fourth quarter, compared to 35% in 2024.
• Delivered another quarter of record free cash flowⁱ generation with $228.2 million achieved during the fourth quarter of 2025, resulting in $387.9 million in free cash flow in 2025.
• Achieved adjusted EBITDAⁱ of $385.9 million in the fourth quarter of 2025, resulting in record annual adjusted EBITDAⁱ of $1,060.9 million.
• Repurchased and retired an additional $39.3 million of senior unsecured notes through open market purchases at a discount to par during the fourth quarter of 2025 reducing total debt to $1.0 billion as of December 31, 2025. Since the end of 2024, Hudbay has reduced its long-term debt by $185.1 million.
• Net debtⁱ decreased by $86.0 million to $439.7 million as at December 31, 2025 compared to $525.7 million at December 31, 2024.
• Net debt to adjusted EBITDA ratioⁱ was 0.4x at the end of the fourth quarter of 2025, a further improvement from 0.6x at the end of the fourth quarter of 2024.
• After giving effect to the recent closing of the Copper World joint venture transaction, which occurred in January 2026, Hudbay's post-closing adjusted cash and cash equivalents as at December 31, 2025 were approximately $992 millionⁱⁱ. In addition, Hudbay had undrawn availability of $424.8 million under its revolving credit facilities as of December 31, 2025, increasing its total post-closing adjusted liquidity to over $1.4 billionⁱⁱ.

Implementing Holistic Capital Allocation Framework to Maintain Strong Financial Discipline, Deliver Growth Initiatives and Maximize Long-term Risk-adjusted Returns

• Enhanced Capital Allocation Framework embedded into Hudbay's annual financial planning cycle to provide a holistic approach to capital allocation decisions, including capital deployment into brownfield projects, greenfield projects, strategic investments and exploration, while considering debt repurchases, share buybacks and dividends.
• Hudbay's recent financial transformation has positioned the Company to introduce a new quarterly dividend of C$0.01 per share, an annual increase of 100% compared to the former semi-annual C$0.01 per share dividend, representing the Company's first dividend increase in its history.
• Closed the accretive $600 million joint venture transaction with Mitsubishi Corporation ("Mitsubishi") in January 2026, securing a premier, long-term 30% strategic partner for the development of Copper World. Definitive feasibility study on track for completion in mid-2026 with a sanctioning decision expected in 2026.
• Ongoing optimization efforts at Copper Mountain include executing an accelerated stripping campaign to deliver higher grades starting in 2027 and mill improvement initiatives to achieve the permitted mill throughput capacity of 50,000 tonnes per day in the second half of 2026.

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• Expected to deliver higher mill throughput rates at Constancia in the second half of 2026 with the installation of pebble crushers.
• Continued 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.
• Underground infrastructure established at the 1901 deposit to enable exploration drilling throughout 2026 and prepare for full production by the end of 2027.
• Drilling activities have increased at the copper-gold-zinc Talbot deposit near Snow Lake with six drill rigs deployed and several step-out drill holes indicating resource expansion potential.
• Engineering work advances on the Flin Flon tailings reprocessing opportunity to assess the economic viability of producing critical minerals and precious metals and the potential to reduce the overall environmental footprint.
• Advancing plans to initiate a pre-feasibility study for the Mason copper project in Nevada.

2026 Guidance Reflects Stable Copper and Gold Production at Industry-leading Margins

• Consolidated copper production of 124,000 tonnes, based on the midpoint of the 2026 guidance range, is expected to increase by 5% compared to 2025 levels, reflecting higher expected production in British Columbia with the anticipated mill throughput ramp-up to the targeted 50,000 tonnes per day in the second half of 2026, partially offset by lower grades in Peru with the depletion of Pampacancha in 2025.
• Consolidated gold production of 244,500 ounces, based on the midpoint of the 2026 guidance range, is expected to be lower than 2025 production, reflecting the depletion of Pampacancha in 2025, but higher in unstreamed gold ounces with higher gold production in Manitoba from mill throughput at New Britannia continuing to exceed expectations.
• Consolidated cash costⁱ, net of by-product credits, in 2026 is expected to be within ($0.30) to ($0.10) per pound of copper, benefiting from higher gold production and a continued focus on maintaining stable operating costs across the business, driving industry-leading margins.
• Total sustaining capital expenditures are expected to be $435 million in 2026, reflecting approximately $38 million in deferrals from 2025 and $44 million in one-time sustaining capital projects at the operations.
• As the Company embarks on generational reinvestments, total growth capital expenditures at the operations are expected to be $140 million in 2026, including approximately $23 million in deferrals from 2025, to advance several high-return growth projects in 2026 to deliver increased copper exposure, including Peru mill throughput enhancement projects, early works at the New Ingerbelle expansion project in British Columbia, and excludes growth capital related to the Copper World joint venture.
• Growth capital expenditures at Copper World are expected to be $135 million in 2026 for project feasibility, de-risking and pre-sanctioning costs, which have been fully funded by the proceeds received from Mitsubishi as part of the closing of the Copper World joint venture transaction in January 2026, and include approximately $60 million for accelerated long lead items and de-risking activities and $35 million of capital deferrals from 2025.

Summary of Fourth Quarter Results

Hudbay's diversified asset portfolio delivered consolidated copper production of 33,069 tonnes and consolidated gold production of 84,298 ounces in the fourth quarter of 2025. Consolidated copper and gold production was higher than the third quarter of 2025 due to strong copper and gold grades from Pampacancha and less ore processed from low-grade stockpiles compared to the third quarter. Consolidated gold production also benefitted from the ramp up to full operations in Snow Lake after the mandatory wildfire evacuations were lifted in the third quarter of 2025 and record monthly throughput at the New Britannia mill in December. Consolidated silver production of 1,002,985 ounces and zinc production of 5,703 tonnes in the fourth quarter of 2025 were also higher than the third quarter of 2025 for the aforementioned reasons.

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Cash generated from operating activities of $209.4 million increased compared to the third quarter of 2025 as a result of higher gross margins driven by strong metal prices and higher sales volumes compared to the third quarter which was impacted by mandatory wildfire evacuations in Manitoba and a temporary operational interruption in Peru. Operating cash flow before change in non-cash working capital was $336.9 million during the fourth quarter of 2025, reflecting an increase of $266.6 million from the third quarter of 2025. This significant increase reflects higher copper and gold sales volumes from normalized operations after temporary interruptions and higher metal prices.

Adjusted EBITDAⁱ was $385.9 million in the fourth quarter of 2025, an increase compared to $142.6 million in the third quarter of 2025 as higher realized metal prices and higher copper and gold sales volumes resulted in strong gross margins during the quarter.

Net earnings attributable to owners was $128.0 million, or $0.32 per share, in the fourth quarter of 2025 compared to $222.4 million, or $0.56 per share, in the third quarter of 2025. The decrease in earnings compared to the third quarter is a result of a non-cash after-tax gain of $242.7 million from a full impairment reversal relating to Hudbay's Copper World project that occurred in the prior quarter.

Adjusted net earnings attributable to ownersⁱ and adjusted net earnings per share attributable to ownersⁱ in the fourth quarter of 2025 were $86.0 million and $0.22 per share, respectively, after adjusting for various non-cash items on a pre-tax basis including a $25.0 million business interruption insurance recovery related to the Manitoba mandatory wildfire evacuations during the year, a $5.7 million mark-to-market revaluation gain on various instruments such as investments and share-based compensation, and a non-cash $5.4 million foreign exchange gain, among other items. This increased compared to adjusted net earnings per share attributable to ownersⁱ of $10.1 million and $0.03 per share in the third quarter of 2025 is a result of higher realized metal prices and higher sales volumes.

Consolidated cash costⁱ, net of by-product credits, was $(0.63) per pound of copper in the fourth quarter of 2025, compared to $0.42 per pound in the third quarter of 2025, as Hudbay continued to demonstrate strong cost control across its operations. The decrease in cash cost from the third quarter was a result of higher by-product credits reflecting the benefits of the Company's diversified asset portfolio with higher realized prices across all metals.

Consolidated sustaining cash costⁱ, net of by-product credits, was $0.94 per pound of copper in the fourth quarter of 2025, which decreased compared to $2.09 per pound in the third quarter of 2025, due to the same factors impacting consolidated cash cost, partially offset by planned higher cash sustaining capital expenditures.

Consolidated all-in sustaining cash costⁱ, net of by-product credits, was $1.43 per pound of copper in the fourth quarter of 2025, lower than the third quarter of 2025 mainly due to the same reasons impacting consolidated cash cost and sustaining cash cost, partially offset by higher corporate general and administrative ("G&A") costs from the revaluation of Hudbay's stock-based compensation due to a higher share price.

As at December 31, 2025, total liquidity was $993.7 million, including $568.9 million in cash and cash equivalents and undrawn availability of $424.8 million under Hudbay's revolving credit facilities. Net debtⁱ at the end of the fourth quarter was $439.7 million, marking an $86.0 million improvement from the fourth quarter of 2024 as a result of deleveraging activities which included the repurchase and retirement of senior unsecured notes. After giving effect to the closing of the Copper World joint venture transaction, post-closing cash and cash equivalents as of December 31, 2025 are approximately $992 millionⁱⁱ, total post-closing adjusted liquidity increases to over $1.4 billionⁱⁱ and post-closing net debtⁱ is approximately zero.

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Summary of Full Year Results

Hudbay achieved 2025 consolidated production guidance for copper and gold, with full year production of 118,188 tonnes of copper and 267,934 ounces of gold. In 2025, the operations also produced 17,646 tonnes of zinc, 3,468,143 ounces of silver and 1,282 tonnes of molybdenum. 2025 represents the 11^th consecutive year in which Hudbay achieved its annual consolidated copper production guidance, since Constancia declared commercial production, and 5^th consecutive year achieving its annual consolidated gold production guidance, since establishing standalone gold production guidance^v.

With respect to Hudbay's operating business units, Peru exceeded the top end of the gold production guidance and achieved the guidance ranges for copper despite the impact from the temporary operational interruption due to social unrest. While Hudbay was previously tracking within the guidance ranges in Manitoba despite the wildfires, gold and zinc production fell below the low end of the respective ranges as a result of an eight-day weather-related power outage in October. Manitoba achieved guidance for copper and silver production despite these interruptions. British Columbia achieved guidance for gold and silver production, while copper production fell below the low end of the guidance range, primarily due to unplanned maintenance at the primary SAG mill in the fourth quarter and a higher portion of low-grade stockpiles utilized as ore feed in 2025.

Cash generated from operating activities increased to $707.3 million in 2025 from $666.2 million in 2024. Operating cash flow before change in non-cash working capital increased to a record $764.3 million in 2025 from $691.1 million in 2024. The increase in operating cash flow before changes in working capital was primarily the result of higher gross margins driven by higher metal prices and stable cost performance despite temporary operational interruptions during the year. This was partially offset by a significant increase in cash taxes paid of $268.4 million, compared to $132.5 million in 2024, reflecting earlier periods of high taxable income mainly at the Peru and Manitoba operations.

Adjusted EBITDAⁱ was $1,060.9 million in 2025, a 29% increase compared to $822.5 million in 2024, achieving a new annual record. The increase was the result of higher realized metal prices and stable operating performance, driving strong cost control across the business.

Net earnings attributable to owners were $568.5 million, or $1.44 per share, in 2025, compared to $76.7 million, or $0.20 per share, in 2024. Net earnings were positively impacted by higher realized prices for all metals and a non-cash charge of $242.7 million relating to an impairment reversal with respect to the Copper World project in 2025, partially offset by higher mining and income tax expenses.

Adjusted net earnings attributable to ownersⁱ and adjusted net earnings per share attributable to ownersⁱ in 2025 were $265.5 million and $0.67 per share, respectively, after adjusting for items on a pre-tax basis such as a $322.3 million impairment reversal with respect to the Copper World project, $25.0 million in business interruption insurance recovery related to the Manitoba wildfires, $18.6 million in foreign exchange gains, and $14.9 million in consideration received from sale of a non-core project, among other items. This compares to adjusted net earnings attributable to ownersⁱ and net earnings per share attributable to ownersⁱ of $181.4 million and $0.48 per share in 2024.

Consolidated cash costⁱ, net of by-product credits, was $(0.22) per pound of copper, compared to $0.46 per pound in 2024. Hudbay significantly outperformed its twice-improved 2025 consolidated cash cost guidance as a result of higher metal prices with a significant increase in gold by-product credits, partially offset by higher G&A due to higher employee profit sharing in Peru and Manitoba.

Consolidated sustaining cash costⁱ, net of by-product credits, of $1.30 per pound of copper in 2025 decreased from $1.62 per pound in 2024 due to the same reasons affecting cash cost, partially offset by higher cash sustaining capital expenditures. Hudbay outperformed the improved 2025 consolidated sustaining cash cost guidance as a result of the same reasons driving the outperformance on cash cost guidance.

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Consolidated all-in sustaining cash costⁱ, net of by-product credits, was $1.74 per pound of copper in 2025, lower than $1.88 per pound in 2024 as a result of the same reasons outlined above, partially offset by higher corporate selling and administrative costs primarily due to a revaluation of share-based compensation associated with a higher share price.

Consolidated Financial Condition (in $ millions, except net debt to adjusted EBITDA ratio)	Dec. 31, 2025	Sep. 30, 2025	Dec. 31, 2024
Cash and cash equivalents and short-term investments	568.9	611.1	581.8
Total long-term debt	1,008.6	1,047.0	1,107.5
Net debt1	439.7	435.9	525.7
Working capital2	(65.6)	(34.7)	511.3
Total assets	6,223.3	5,916.8	5,487.6
Equity attributable to owners of the Company	3,231.0	3,080.5	2,553.2
Net debt to adjusted EBITDA1	0.4	0.5	0.6

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 the "Non-GAAP Financial Performance Measures" section of this news release.

² Working capital is determined as total current assets less total current liabilities as defined under IFRS and disclosed on the consolidated financial statements. Working capital as of December 31, 2025 was impacted by an increase in the current portion of long-term debt of $472.1 million as the 2026 Notes are now maturing within one year.

Consolidated Financial Performance	Three Months Ended			Year Ended
(in $ millions)	Dec. 31, 2025	Sep. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Revenue	732.9	346.8	584.9	2,211.0	2,021.2
Cost of sales	462.8	281.5	400.5	1,467.8	1,467.4
Earnings before tax	257.1	330.5	103.7	912.0	251.6
Net earnings	128.0	222.4	19.3	564.3	67.8
Net earnings attributable to owners	128.0	222.4	21.2	568.5	76.7
Basic and diluted attributable earnings per share	0.32	0.56	0.05	1.44	0.20
Adjusted earnings attributable per share1	0.22	0.03	0.18	0.67	0.48
Operating cash flow before change in non-cash working capital	336.9	70.3	231.5	764.3	691.1
Adjusted EBITDA1	385.9	142.6	257.3	1060.9	822.5
Free cash flow1	228.2	(15.2)	149.0	387.9	368.0
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, please see the "Non-GAAP Financial Performance Measures" section of this news release.

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Consolidated Production and Cost Performance		Three Months Ended				Year Ended
		Dec. 31, 2025		Sep. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Contained metal in concentrate and doré produced1
Copper	tonnes	33,069		24,205	43,262	118,188	137,943
Gold	ounces	84,298		53,581	94,161	267,934	332,240
Silver	ounces	1,002,985		730,394	1,311,658	3,468,143	3,983,851
Zinc	tonnes	5,703		548	8,385	17,646	33,339
Molybdenum	tonnes	325		185	195	1,282	1,323
Payable metal sold
Copper	tonnes	34,132		18,280	37,927	114,534	125,094
Gold2	ounces	84,424		38,279	92,734	260,261	335,342
Silver2	ounces	871,006		418,418	1,150,518	3,190,552	3,549,816
Zinc	tonnes	3,972		3,452	5,261	15,152	25,120
Molybdenum	tonnes	190		269	182	1,334	1,287
Consolidated cash cost per pound of copper produced3
Cash cost	$/lb	(0.63)		0.42	0.45	(0.22)	0.46
Sustaining cash cost	$/lb	0.94		2.09	1.37	1.30	1.62
All-in sustaining cash cost	$/lb	1.43		2.78	1.53	1.74	1.88

¹ Metal reported in concentrate is prior to deductions associated with smelter contract terms.

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.

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Peru Operations Review

Peru Operations		Three Months Ended			Year Ended
		Dec. 31, 2025	Sep. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Constancia ore mined1	tonnes	5,610,915	564,579	4,186,058	21,539,089	15,046,190
Copper	%	0.31	0.25	0.40	0.31	0.34
Gold	g/tonne	0.03	0.02	0.04	0.03	0.04
Silver	g/tonne	3.27	1.92	3.88	3.18	3.08
Molybdenum	%	0.01	0.01	0.02	0.02	0.01
Pampacancha ore mined1	tonnes	4,152,000	4,260,081	4,037,264	9,563,442	9,317,499
Copper	%	0.43	0.38	0.63	0.40	0.55
Gold	g/tonne	0.27	0.31	0.38	0.29	0.32
Silver	g/tonne	4.84	4.87	6.43	4.78	5.61
Molybdenum	%	0.01	0.01	0.00	0.01	0.01
Total ore mined	tonnes	9,762,915	4,824,660	8,223,322	31,102,531	24,363,689
Strip ratio2		0.57	1.38	1.22	1.04	1.78
Ore milled	tonnes	7,627,853	6,991,744	7,999,453	30,292,668	31,933,624
Copper	%	0.39	0.31	0.48	0.33	0.36
Gold	g/tonne	0.18	0.16	0.20	0.11	0.14
Silver	g/tonne	4.19	3.94	5.28	3.72	3.84
Molybdenum	%	0.01	0.01	0.01	0.01	0.01
Copper recovery	%	84.5	83.2	87.8	84.3	85.0
Gold recovery	%	74.7	72.1	73.3	69.2	70.7
Silver recovery	%	71.1	65.2	71.4	66.7	68.8
Molybdenum recovery	%	38.8	33.9	37.1	37.4	41.7
Contained metal in concentrate
Copper	tonnes	25,038	18,114	33,988	85,155	99,001
Gold	ounces	32,865	26,380	38,079	74,480	98,226
Silver	ounces	731,017	577,446	969,502	2,415,134	2,708,262
Molybdenum	tonnes	325	185	195	1,282	1,323
Payable metal sold
Copper	tonnes	28,361	11,769	28,775	84,438	88,138
Gold	ounces	37,874	9,798	37,459	71,755	103,364
Silver	ounces	650,384	258,215	824,613	2,239,832	2,343,820
Molybdenum	tonnes	190	269	182	1,334	1,287
Combined unit operating cost3,4,5	$/tonne	14.51	13.03	15.25	13.02	12.91
Cash cost4,6	$/lb	0.57	1.30	1.00	1.08	1.18
Sustaining cash cost4	$/lb	1.53	2.11	1.48	2.02	1.86
1 Reported tonnes and grade for ore mined are estimates based on mine plan assumptions and may not reconcile fully to ore milled. 2 Strip ratio is calculated as waste mined divided by ore mined. 3 Reflects combined mine, mill and 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 Excludes approximately $1.3 million or $0.17 per tonne of overhead costs incurred during temporary suspension during the three months ended December 31, 2025, $7.3 million or $1.04 per tonne during the three months ended September 30, 2025 and $8.6 million or $0.28 per tonne during the year ended December 31, 2025. 6 Excludes approximately $1.3 million or $0.02 per pound of overhead costs incurred during temporary suspension during the three months ended December 31, 2025, $7.3 million or $0.19 per pound during the three months ended September 30, 2025 and $8.6 million or $0.05 per pound during year ended December 31, 2025.

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Peru operations had its strongest quarter of the year in the fourth quarter, with continued strong copper and gold grades from Pampacancha and less ore processed from low-grade stockpiles compared to the third quarter of 2025. The Company continued to optimize the mine plan in the fourth quarter with more ore mined from Pampacancha than previously expected, resulting in the accelerated depletion of Pampacancha in late December as opposed to early 2026 and enabling Hudbay to exceed the top end of the 2025 Peru gold guidance range.

During the fourth quarter of 2025, the Peru operations produced 25,038 tonnes of copper, 32,865 ounces of gold, 731,017 ounces of silver and 325 tonnes of molybdenum. Production of copper, gold and silver increased by 38%, 25% and 27%, respectively, compared to the third quarter of 2025. Production of all metals was higher primarily due to higher ore milled as the third quarter was impacted by a temporary operational interruption due to social unrest. Hudbay temporarily suspended Constancia operations from September 22^nd to October 3^rd as a result of illegal protests at the mine and as a precaution to ensure the safety of personnel and community members. Production of molybdenum was higher in the fourth quarter of 2025 due to higher recoveries and additional tonnes of ore milled in the molybdenum plant.

Despite the impacts from social unrest in the third quarter, Hudbay achieved its 2025 production guidance for copper and gold in Peru, with gold production exceeding the top end of the 2025 guidance range by 24%. Production of silver and molybdenum fell slightly short of the lower end of guidance. Full year 2025 production of copper, gold, silver and molybdenum was 85,155 tonnes, 74,480 ounces, 2,415,134 ounces, and 1,282 tonnes, respectively, representing a decrease of 14%, 24%, 11% and 3%, respectively, from the comparative 2024 period primarily due to fewer tonnes of ore milled in the current period due to the aforementioned temporary operational interruption in the third quarter of 2025 and lower grades from higher amounts of ore processed from stockpile.

Total ore mined in the fourth quarter was 102% higher than the third quarter of 2025, a sizable increase due to the impacts from social unrest during the third quarter. Mining activities in the Pampacancha pit were completed during the fourth quarter and the remaining stockpiled Pampacancha ore was fully processed during January 2026.

Total mill throughput increased to 7.6 million tonnes during the fourth quarter of 2025, higher than the third quarter of 2025 due to higher mechanical availability as the prior quarter was impacted by the temporary operational interruption due to social unrest, partially offset by a scheduled semi-annual mill maintenance shutdown in the fourth quarter of 2025. Milled copper grades increased by 26% compared to the third quarter 2025, primarily due to higher grades from Pampacancha and less ore processed from stockpiles. Milled gold grades increased compared to the third quarter of 2025 due to a higher portion of ore feed from Pampacancha where the gold grades are meaningfully higher than at Constancia. Copper recoveries of 85% in the fourth quarter of 2025 were higher compared to the third quarter of 2025 due to the different proportions of ore feed from stockpiles and pits. Recoveries of gold and silver during the fourth quarter of 2025 were in line with Hudbay's metallurgical models for the ore that was being processed.

The Company continues to advance the installation of pebble crushers in Peru to increase mill throughput rates starting in the second half of 2026, which will allow Constancia to deliver steady annual copper production despite lower grades from the depletion of Pampacancha. Hudbay's efforts to increase mill throughput align with the Peru Ministry of Energy and Mines' regulatory change to allow mining companies to operate up to 10% above permitted levels.

Combined mine, mill and G&A unit operating cost in the fourth quarter of 2025 was $14.51 per tonne, 11% higher than the third quarter of 2025 due to higher fuel consumption associated with additional tonnes of material moved, higher water management and dewatering costs, and higher milling costs associated with the scheduled semi-annual mill maintenance program, partially offset by additional tonnes milled. Combined mine, mill and G&A unit operating cost for the full year 2025 was $13.02 per tonne, which was consistent with 2024.

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Cash costⁱ, net of by-product credits, in the fourth quarter of 2025 was $0.57 per pound of copper, a 56% decrease compared to the third quarter of 2025, as a result of higher gold by-product credits, partially offset by higher profit sharing. Full year 2025 cash costⁱ, net of by-product credits, was $1.08 per pound of copper, outperforming the low end of the Peru cash cost guidance range and representing a 8% improvement from 2024 due to lower treatment and refining charges and higher by-product credits from gold, partially offset by higher profit sharing and lower pounds of copper produced due to the impacts from social unrest in the third quarter.

Sustaining cash costⁱ, net of by-product credits, was $1.53 per pound of copper in the fourth quarter of 2025, a 27% decrease compared to the third quarter of 2025 due to higher gold by-product credits, partially offset by higher capital spending as a result of timing of sustaining capitalized expenditures, higher community payments and increased lease payments. Full year 2025 sustaining cash costⁱ, net of by-products credits, was $2.02 per pound copper, higher than $1.86 per pound in 2024 due to lower grade, higher planned mine maintenance, higher lease payments, and higher payments to communities. This was partially offset by lower treatment and refining charges and higher by-product credits from gold.

Fourth quarter copper, gold and silver metal sold was higher than the third quarter of 2025 primarily due to the shifting of copper concentrate sales at the end of the third quarter into early in the fourth quarter as a result of ocean swells at the port in late September. While copper concentrate inventory levels normalized at the end of December 2025, the concentrate contained higher levels of precious metals due to a higher portion of Pampacancha production in the second half of the year, resulting in a shift of some precious metals sales from December 2025 to January 2026.

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Manitoba Operations Review

Manitoba Operations		Three Months Ended				Year Ended
		Dec. 31, 2025	Sep. 30, 2025		Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Lalor
Ore mined	tonnes	353,819	139,006		422,454	1,180,121	1,626,935
Gold	g/tonne	5.51	5.42		4.61	5.35	4.68
Copper	%	0.82	0.67		0.95	0.79	0.85
Zinc	%	2.55	1.93		2.95	2.41	2.84
Silver	g/tonne	29.52	31.57		31.91	30.43	27.14
New Britannia
Ore milled	tonnes	179,808	92,765		185,592	624,631	715,198
Gold	g/tonne	6.68	6.88		5.99	6.87	6.29
Copper	%	1.08	0.76		1.17	0.95	1.04
Zinc	%	1.30	1.00		1.08	1.09	0.99
Silver	g/tonne	31.17	32.18		33.97	31.75	27.78
Gold recovery1	%	88.6	91.8		90.2	89.8	89.7
Copper recovery	%	88.6	90.0		91.3	89.2	93.6
Silver recovery1	%	77.1	78.5		79.6	79.0	80.9
Stall Concentrator
Ore milled	tonnes	169,274	43,940		222,004	572,704	893,510
Gold	g/tonne	3.24	3.10		3.36	3.45	3.42
Copper	%	0.69	0.56		0.73	0.67	0.71
Zinc	%	4.32	3.61		4.62	3.90	4.33
Silver	g/tonne	24.97	31.04		29.90	28.31	26.54
Gold recovery	%	71.3	72.6		69.6	70.1	68.6
Copper recovery	%	86.5	83.4		84.4	86.7	87.4
Zinc recovery	%	78.0	34.6		81.7	79.0	86.2
Silver recovery	%	55.6	50.3		55.1	55.4	56.8
Total contained metal in concentrate and doré2
Gold	ounces	47,423	22,441		51,438	173,453	214,225
Copper	tonnes	3,326	842		3,347	9,249	12,536
Zinc	tonnes	5,703	548		8,385	17,646	33,339
Silver	ounces	214,493	102,132		283,223	800,198	995,090
Total payable metal sold
Gold	ounces	43,226	23,118		50,239	169,041	212,243
Copper	tonnes	2,024	769		3,321	7,651	11,602
Zinc	tonnes	3,972	3,452		5,261	15,152	25,120
Silver	ounces	175,324	112,142		282,158	729,314	956,460
Combined unit operating cost3,4,5	C$/tonne	248	258		233	236	226
Gold cash cost4,6	$/oz	705	379		607	549	606
Gold sustaining cash cost4	$/oz	1,110	762		908	875	868

¹ Gold and silver recovery includes total recovery from concentrate and doré.

² 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.

³ Reflects combined mine, mill and G&A costs per tonne of ore milled.

⁴ Combined unit operating cost, 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, please see the "Non-GAAP Financial Performance Measures" section of this news release.

⁵ Excludes overhead costs of $16.0 million or C$163 per tonne during the three months ended September 30, 2025 and $19.2 million or C$22 per tonne during the year ended December 31, 2025.

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⁶ Excludes overhead costs of $16.0 million or $713 per ounce during the three months ended September 30, 2025 and $19.2 million or $111 per ounce during the year-ended December 31, 2025.

Manitoba operations normalized in the fourth quarter of 2025 following the significant wildfire disruptions in the second and third quarters of 2025 allowing the Company to achieve quarterly production numbers similar to what were demonstrated earlier in the year. The Manitoba operations produced 47,423 ounces of gold, 3,326 tonnes of copper, 5,703 tonnes of zinc and 214,493 ounces of silver in the fourth quarter of 2025. Production of all metals in the fourth quarter was higher than the third quarter of 2025, which was negatively impacted by mandatory wildfire evacuations.

Achievements in the fourth quarter included improved metal recovery rates, advancements in Hudbay's exploration programs in Flin Flon and Snow Lake, including the prospective copper-gold-zinc Talbot satellite deposit, and the graduation of the second cohort from the mining fundamentals training program focused on providing local and Indigenous communities with valuable mining skills. In 2025, Hudbay signed exploration agreements with the Mosakahiken Cree Nation and the Kiciwapa Cree Nation and achieved record throughput at the New Britannia mill in December. All of this was underpinned by a continued focus on safety with a 15% reduction in total recordable injury frequency achieved in 2025.

Production for the full year 2025 in Manitoba was lower than 2024 as a result of two months of production deferrals due to mandatory wildfire evacuations in 2025, an eight-day weather-related power outage in October 2025 and the subsequent ramp-up period required to restore full operational cadence. While the operations were tracking within all guidance ranges earlier in the year, full year gold and zinc production fell below the low end of the respective ranges. Despite the disruptions, 2025 full year production in Manitoba successfully achieved guidance for copper and silver.

The Lalor mine focused on stabilizing production in the fourth quarter after the resumption of operations following the mandatory wildfire evacuations. Lalor averaged over 4,200 tonnes per operating day in the fourth quarter, strategically prioritizing mining from gold zones to ensure prioritized feed for the New Britannia mill. This was accomplished through a focus on mine planning and the maintenance recovery plan to get Lalor's underground mobile fleet back to pre-wildfire availability numbers. In the fourth quarter of 2025, gold grades increased by 2% compared to the third quarter of 2025 due to mining techniques resulting in improved ore quality and prioritizing mining gold zones at Lalor.

The 1901 deposit delivered 6,600 tonnes of development ore in 2025 as the project progresses towards full production in 2027. During the year, haulage and exploration drifts were prioritized as infrastructure was being put in place. In 2026, activities at 1901 will prioritize exploration and definition drilling, orebody access, and establishing critical infrastructure ahead of full production in late 2027.

The New Britannia mill processed approximately 2,300 tonnes per day in December, achieving a new monthly throughput record of 71,504 tonnes. This achievement is aligned with the strategy to prioritize gold ore production and resulted from continuous improvement efforts focused on unlocking capacity at designed or improved recovery rates. Despite the wildfire challenges in 2025, New Britannia achieved its second highest annual throughput of 624,631 tonnes as Lalor delivered production from the gold zones, ensuring a consistent feed to the mill. New Britannia's gold recovery in the quarter was 89%, reflecting a slight decrease compared to the third quarter of 2025 due to ore blend resulting in slightly lower gold grades processed at the mill.

The Stall mill continues to focus on process optimization and enhanced gold recovery initiatives targeting over 70% gold recovery from the base metal ore stream. The Stall mill processed significantly less ore in 2025 compared to the same periods in 2024, which is aligned with the Company's strategy of allocating more Lalor ore feed to New Britannia as noted above. The Stall mill achieved gold recoveries of 71% in the fourth quarter of 2025, reflecting benefits from process optimization and enhanced gold recovery initiatives.

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Combined mine, mill and G&A unit operating costsⁱ in the fourth quarter and full year 2025 were C$248 per tonne and C$236 per tonne, respectively, relatively consistent with all comparable periods after adjusting for the allocation of fixed overheads in periods with lower capacity utilization due to the wildfires.

Cash costⁱ, net of by-product credits, was $705 per ounce of gold in the fourth quarter of 2025, higher than the third quarter of 2025 primarily due to higher overall costs and the impact of the recovery of secondary gold products in the third quarter as a result of mill tank clean-outs, partially offset by higher production. Full year 2025 cash costⁱ, net of by-product credits, was $549 per ounce of gold, a 9% decrease compared to the same period in 2024 primarily due to lower operating costs partially offset by lower gold production and higher profit sharing. This strong cost performance was supported by the strategic decision to prioritize high-margin gold production over by-product zinc production. Despite the production headwinds, cash cost for the full year 2025 outperformed the low end of the guidance range.

Sustaining cash costⁱ, net of by-product credits, was $1,110 per ounce gold in the fourth quarter of 2025, higher than the third quarter of 2025 primarily due to the same factors affecting cash costs and elevated capital sustaining capital expenditures. Full year 2025 sustaining cash costⁱ, net of by-product credits, was $875 per ounce of gold, a slight increase from 2024 primarily due to the same factors affecting cash cost noted above with slightly higher capital expenditures.

Manitoba sales volumes in the fourth quarter of 2025 reflect a rebuild of inventory levels as operations normalized after the wildfires in the second and third quarters of 2025.

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British Columbia Operations Review

British Columbia Operations5		Three Months Ended					Year Ended5
			Dec. 31, 2025		Sep. 30, 2025	Dec. 31, 2024	Dec. 31, 2025	Dec. 31, 2024
Ore mined1	tonnes		2,395,166		1,815,689	2,374,044	9,368,918	11,360,125
Strip ratio2			7.18		8.84	7.36	7.46	5.98
Ore milled	tonnes		2,268,405		3,087,443	2,880,927	11,016,842	12,656,679
Copper	%		0.26		0.22	0.26	0.27	0.25
Gold	g/tonne		0.09		0.08	0.09	0.09	0.08
Silver	g/tonne		1.10		0.78	0.92	1.02	0.96
Copper recovery	%		78.4		76.6	79.5	78.6	82.4
Gold recovery	%		63.3		59.2	55.8	63.6	60.5
Silver recovery	%		71.4		65.5	69.0	69.7	71.8
Total contained metal in concentrate
Copper	tonnes		4,705		5,249	5,927	23,784	26,406
Gold	ounces		4,010		4,760	4,644	20,001	19,789
Silver	ounces		57,475		50,816	58,933	252,811	280,499
Total payable metal sold
Copper	tonnes		3,747		5,742	5,831	22,445	25,354
Gold	ounces		3,324		5,363	5,036	19,465	19,735
Silver	ounces		45,298		48,061	43,747	221,406	249,536
Combined unit operating cost3,4	C$/tonne		39.80		25.02	23.22	28.12	20.39
Cash cost4	$/lb		4.82		3.21	3.00	3.06	2.74
Sustaining cash cost4	$/lb		8.87		7.43	5.76	6.12	5.29

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

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

³ Reflects combined mine, mill and 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%.

Throughout 2025, Hudbay focused on advancing its multi-year optimization plan at Copper Mountain, centered on ramping up mining activities and implementing standardized operating practices. A key pillar of this ramp-up was the successful onboarding of over 240 new employees, significantly expanding the Company's in-house team of skilled equipment operators. This strategic investment has led to a meaningful reduction in reliance on temporary contractor labour, ensuring long-term operational stability.

During the fourth quarter of 2025, the British Columbia operations produced 4,705 tonnes of copper, 4,010 ounces of gold and 57,475 ounces of silver. Metal production was lower compared to the third quarter of 2025, primarily reflecting reduced mill throughput caused by the unplanned maintenance on the primary SAG.

For the full year 2025, production of copper, gold and silver was 23,784 tonnes, 20,001 ounces and 252,811 ounces, respectively. Annual copper and silver production were lower year-over-year, reflecting lower mill availability in the fourth quarter of 2025 and the strategic focus on waste stripping during the period. Despite the throughput constraints encountered in the latter half of the year, annual gold production increased by 1% compared to 2024. This growth was driven by higher head grades and improved gold recoveries resulting from the flotation circuit optimizations implemented throughout the year. The British Columbia operations achieved 2025 production guidance for gold and silver, while copper production fell below the low end of the 2025 guidance range due to the unplanned maintenance at the primary SAG mill in the fourth quarter and a higher than anticipated proportion of lower grade stockpile ore processed throughout the year.

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Mining operations have focused on a three-year accelerated stripping program to unlock higher grade ore starting in 2027. In the fourth quarter of 2025, this initiative was bolstered by an optimized mining sequence and enhanced maintenance, driving mining rates to a targeted 300,000 tonnes per day in December. To sustain this momentum, a new production loader was commissioned in January 2026, and a new shovel is currently scheduled for deployment in March 2026.

Total ore mined at Copper Mountain in the fourth quarter of 2025 was 2.4 million tonnes, an increase of 32% compared to the third quarter of 2025. During the quarter, the mining team utilized planned ore stockpiles for mill feed and higher-grade ore from an advanced phase in the main pit, allowing the operation to prioritize waste stripping activities to expose higher-value mining fronts in the future. The significant quarter-over-quarter improvement reflects the optimization of the mining sequence, which improved bench configurations and eliminated phase interference, along with enhanced mobile equipment maintenance protocols leading to more consistent availability.

In the mill, the permanent feeder configuration for the second SAG mill was commissioned late in the fourth quarter, and the temporary conveyor system located on the ore live pile was removed in January 2026. With the completion of the permanent feeder for the second SAG mill project in December, the second SAG mill continued to demonstrate positive contributions to overall throughput in the fourth quarter. The mill processed 2.3 million tonnes of ore during the fourth quarter of 2025, a decrease of 27% compared to the third quarter of 2025 primarily as a result of unplanned maintenance on the primary SAG mill to address localized damage to the feed end head. Operations were further constrained by elevated clay content in the ore feed and the planned decrease of the ore feed pile to accommodate the construction and tie-ins for the second SAG expansion project. To mitigate these challenges and build long-term reliability, the team implemented several initiatives in 2025, including crushing circuit chute modifications, the installation of advanced grinding control instrumentation, and a redesigned SAG liner package.

Despite throughput constraints, milled copper grades during the fourth quarter of 2025 were 18% higher than the third quarter of 2025, driven by higher grades in ore mined. Copper recoveries improved to 78% in the fourth quarter of 2025, supported by higher-grade feed and ongoing flotation circuit refinements. Gold recoveries of 63% saw a 7% increase over the third quarter as a result of general improvements in the flotation system.

While the primary SAG mill continues to operate under a reduced load, it is being rigorously monitored ahead of a feed end head replacement in mid-2026. In the first half of 2026, optimization efforts will focus on automated grinding media loading, installing a mill slicer on the second SAG, implementing advanced process control on grinding and flotation, and a pebble circuit trial to improve overall throughput capacity.

The mill remains on track to achieve its permitted capacity of 50,000 tonnes per day in the second half of 2026 with the permanent second SAG feeder configuration commissioned in December 2025, the removal of live-pile restrictions in January, the proactive primary SAG feed end head replacement in mid-2026 and rollout of automated grinding media loading and advanced process controls.

Combined mine, mill and G&A unit operating costsⁱ were C$39.80 per tonne milled in the fourth quarter of 2025. This increase relative to the third quarter of 2025 was primarily due to lower milled throughput and non-recurring costs associated with the unplanned primary SAG mill maintenance. Additionally, mining and administrative costs were higher in the fourth quarter as the operations transitioned towards an expanded in-house workforce and continued to advance the accelerated stripping program. For the full year 2025, unit operating costsⁱ were C$28.12 per tonne, compared to C$20.39 per tonne milled in the same period of 2024, reflecting the lower annual throughput and the strategic ramp-up of site-wide optimization initiatives.

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Cash costⁱ and sustaining cash costⁱ, net of by-product credits, were $4.82 and $8.87 per pound of copper, respectively, in the fourth quarter of 2025. Cash cost was higher than the third quarter of 2025, largely driven by the ramp up of mining activities in the fourth quarter to advance the accelerated stripping program combined with lower by-product credits as a result of the primary SAG maintenance early in the fourth quarter. Sustaining cash costs were higher than the third quarter of 2025 due to higher cash costs, offset by lower capitalized stripping costs.

Despite the throughput and copper production headwinds in 2025, the British Columbia business unit demonstrated strong cost discipline. Full year 2025 cash costⁱ and sustaining cash costⁱ, net of by-product credits, were $3.06 and $6.12 per pound of copper, respectively, achieving the annual guidance range.

Following the quarter end, the New Ingerbelle project reached a major milestone with the provincial regulators referring the permit application to Statutory Decision Makers on January 16, 2026. New Ingerbelle permits are expected to be received in the first quarter of 2026, and the project is expected to further extend mine life at Copper Mountain. Furthermore, Hudbay finalized refreshed Participation Agreements with the Upper and Lower Similkameen Indian Bands in February 2026, reinforcing the Company's commitment to strong Indigenous partnerships.

Continued Free Cash Flow Generation Driving Further Debt Reduction and Significant Financial Flexibility

Hudbay has delivered several quarters of meaningful free cash flow generation as a result of steady operating performance, expanding margins from strong copper and gold exposure and a focus on cost control across the business. This has resulted in Hudbay achieving record annual adjusted EBITDAⁱ of $1,060.9 million and record annual free cash flowⁱ of $387.9 million in 2025.

As a result of the strong operating and financial performance, Hudbay continued its prudent balance sheet management and further reduced overall debt levels in the fourth quarter of 2025, resulting in a total of $102.5 million in debt repayments during the full year 2025. These deleveraging efforts have reduced total principal debt to $1,008.6 million as of December 31, 2025.

As of December 31, 2025, Hudbay had approximately $569 million in cash and cash equivalents, resulting in a reduction in net debt to $439.7 million compared to $525.7 million at December 31, 2024. Similarly, Hudbay reduced its net debt to adjusted EBITDA ratio to 0.4x at the end of the fourth quarter of 2025, a further improvement from 0.6x at the end of fourth quarter of 2024.

After giving effect to the closing of the Copper World joint venture transaction, as described below, Hudbay's post-closing adjusted cash and cash equivalents as at December 31, 2025 was approximately $992 millionⁱⁱ. In addition, Hudbay had undrawn availability of $425 million under Hudbay's revolving credit facilities as of December 31, 2025, increasing total post-closing adjusted liquidity to over $1.4 billionⁱⁱ. Hudbay is well-positioned to advance Copper World and fund its several other high-return growth opportunities across the business.

Prudently Advancing Copper World Towards a Sanction Decision in 2026

In January 2026, Hudbay announced the closing of the joint venture transaction ("JV Transaction") with Mitsubishi, securing a premier, long-term strategic partner for the development of Copper World. The Company continues to progress the detailed engineering work to de-risk Copper World ahead of a sanction decision later this year.

• Realized Accretive JV Transaction - On January 12, 2026, Hudbay announced the closing of the highly accretive $600 million JV Transaction, which represents a significant de-risking milestone in advancing Copper World and further validates the premium long-term value of this world-class asset. The $420 million of proceeds received at closing from Mitsubishi will be used to directly fund the remaining definitive feasibility study ("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. The JV Transaction increases the project IRR to Hudbay to approximately 90% based on pre-feasibility study ("PFS") estimatesⁱⁱⁱ.

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• Secured Premier Strategic Joint Venture Partner - Mitsubishi is one of the largest Japanese trading houses with a global mining presence and a significant U.S.-based business. Mitsubishi is the partner of choice with investments in a world-class portfolio of large and high-quality copper assets, including five of the top twenty copper mines globally by 2024 production. This partnership validates the attractive long-term value of Copper World as a world-class copper asset and endorses the strong technical capabilities of Hudbay. It also represents the beginning of a long-term strategic partnership, and the parties are identifying other opportunities for collaboration to advance their respective copper growth strategies.
• Achieved Key Elements of Hudbay's Three Prerequisites (3-P) Plan - Hudbay has achieved the final key elements of its prudent 3-P financial strategy for the development of Copper World with the closing of the JV Transaction and the achievement of stated balance sheet targets. After accounting for proceeds from the JV Transaction, Hudbay has post-closing cash and cash equivalents of $992 millionⁱⁱ and reduced its post-closing net debt to adjusted EBITDA ratio to 0.0x, far exceeding the stated balance sheet targets. The Mitsubishi initial investment and its future pro-rata equity capital contributions, together with the Wheaton Precious Metals Corp. stream^iv, provide significant financial flexibility by reducing Hudbay's estimated share of the remaining capital contributions to approximately $200 million based on PFS estimates and deferring Hudbay's first capital contribution to 2028 at the earliest.
• Feasibility Study and Detailed Engineering Underway - Feasibility activities for Copper World are well underway with expected completion of the DFS in mid-2026. Hudbay has continued to execute detailed engineering work and other de-risking activities, in preparation for a Copper World sanctioning decision expected in 2026.

Manitoba Exploration Update

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 multi-phased drilling campaigns as part of Hudbay's threefold exploration strategy:

• Near-mine Exploration at Lalor and 1901 to Further Increase Near-term Production and Extend Mine Life - Hudbay completed the development of the initial exploration drift at the 1901 deposit in 2025 and the development of the haulage drift is underway. Hudbay received positive initial step-out drilling results from the exploration drift, and during the second half of 2025, some zinc development ore was delivered for processing at Stall. Activities at 1901 over the next two years will focus on exploration, definition drilling, orebody access and establishing critical infrastructure for full production in late 2027. Exploration activities at 1901 will target additional step-out drilling to potentially extend the orebody and infill drilling to convert inferred mineral resources in the gold lenses to mineral reserves.
• Testing Regional Satellite Deposits to Utilize Available Processing Capacity and Increase Production - Hudbay increased its regional land package by more than 250% in 2023 through the acquisition of Rockcliff Metals Corp. ("Rockcliff"), which included the addition of several known deposits located within trucking distance of the Snow Lake processing infrastructure. The deposits acquired as part of the Rockcliff acquisition, together with several deposits already owned by Hudbay in Snow Lake, have created an attractive portfolio of regional deposits in Snow Lake, including the Talbot, New Britannia, Rail, Pen II, Watts, 3 Zone and WIM deposits. The continued strong performance from the New Britannia mill has freed up processing capacity at the Stall mill, where there is approximately 1,500 tonnes per day of available capacity which could be utilized by the regional satellite deposits to increase production and extend the life of the Snow Lake operations beyond 2037.

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• Exploring Large Land Package for a New Anchor Deposit to Significantly Extend Mine Life - A majority of the land claims acquired as part of the Rockcliff acquisition have been untested by modern deep geophysics, which was the discovery method for the Lalor deposit. A large geophysics program is currently 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 geophysics program is the largest geophysics program in Hudbay's history and includes 800 kilometres of ground electromagnetic surveys and an extensive airborne geophysics survey.

Talbot Initial Drilling Results Confirm Resource Expansion Potential

Talbot is a copper-zinc-gold rich VMS deposit located within trucking distance to existing processing infrastructure in Snow Lake. Successful drilling campaigns could expand the resource base and support a PFS to upgrade the mineral resources to reserves, extending the overall mine life of the Snow Lake operations. In April 2025, Hudbay announced the signing of the exploration agreement with the Mosakahiken Cree Nation on exploration activities in their traditional and ancestral territory, including at Talbot. 

In July 2025, Hudbay commenced an extensive summer drill program at Talbot focused on expanding the known mineralization at depth, testing geophysical targets as well as conducting an infill drill program in the upper part of the ore body to support a PFS. As part of the initial drilling program in 2025, Hudbay drilled six holes to test the continuity of the Talbot deposit at depth, with all the holes yielding positive results and four of them returning mineralized intercepts with economic potential (see table of intercepts below). The 2026 drilling program has now commenced with six drill rigs deployed, including one drill rig focused on continuing to expand the footprint of the deposit at depth. In addition to the intercepts below, another hole provided a significant intercept of copper mineralization over an estimated length of 19.7 metres from core logging and for which assay results are pending.

Hole ID	From (m)	To (m)	Intercept (m)	Estimated true width (m)1	Cu (%)2	Au (g/t)2	Ag (g/t)2	Zn (%)2	CuEq. (%)3,4
TLS024	1556.0	1567.5	11.5	10.4	2.4	1.8	55.1	0.8	4.2
TLS025 top	1435.3	1449.5	14.2	13.2	1.2	0.8	17.8	0.5	2.0
TLS025 bottom	1459.0	1465.0	6.0	5.6	2.0	0.7	16.9	0.5	2.6
TLS026	1265.5	1273.4	7.8	7.1	1.4	0.9	18.4	0.3	2.2
TLS027W02	1252.8	1271.5	18.8	16.3	1.4	0.8	18.9	1.3	2.4

¹ True widths are estimated based on drill angle and intercept geometry of mineralization.

² All copper, gold, silver and zinc values are uncut.

³ Copper-equivalent ("CuEq.") grade calculated using the following long-term commodity price assumptions: $4.40 per pound copper, $2,800 per ounce gold, $32.00 per ounce silver and $1.25 per pound zinc.

⁴ Using the combined recoveries of New Britannia and Stall mills of 89% copper, 89% gold, 81% silver and 84% zinc.

In 2026, the Company plans on progressing a PFS and preparing an updated mineral resource estimate for Talbot using Hudbay standard methods that have demonstrated high reserve conversion rates.

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Expanded Flin Flon Exploration Partnership with Marubeni and JOGMEC

On January 22, 2026, the Company announced the signing of an amended and restated option agreement with Japan Organization for Metals and Energy Security ("JOGMEC") and Marubeni Corporation ("Marubeni"), where Hudbay granted JOGMEC an option to acquire a 10% interest in three projects located within trucking distance of Hudbay's processing facilities in Flin Flon, Manitoba. In order to exercise its option, JOGMEC is required to fund at least C$6 million in exploration expenditure over a period of approximately three years, with Hudbay acting as the operator carrying out the exploration activities. The agreement is an amendment and restatement of the option agreement with Marubeni from March 2024, pursuant to which Marubeni's wholly-owned Canadian subsidiary was granted an option to acquire a 20% interest in the three projects, provided it, funds at least C$12 million in exploration expenditures over the designated earn-in period, which is inclusive of past contributions made by Marubeni since March 2024.

The option agreement focuses on three projects in the Flin Flon region, namely Cuprus-White Lake, Westarm and North Star, which were selected by Marubeni prior to the original March 2024 agreement and following a period of detailed due diligence. All three properties hold past producing mines that generated meaningful production with attractive grades of both base metals and precious metals. The properties remain highly prospective with potential for further discovery based on the attractive geological setting, limited historical deep drilling and promising geochemical and geophysical targets. Cuprus-White Lake, Westarm and North Star are all within 20 kilometres of Hudbay's Flin Flon milling complex.

Senior Management Team Appointments

In January 2026, Hudbay appointed Audra Walsh to the role of Vice President, South America Business Unit. Ms. Walsh joined Hudbay as acting Vice President in Peru in August 2025 and has transitioned to the permanent role as a testament to her exceptional talent as a professional engineer with over 30 years of technical, operating, management, executive and board experience in the mining industry. As leader of the South America Business Unit, Ms. Walsh is responsible for the strategic performance of Hudbay's operational and exploration activities in Peru and exploration activities in Chile.

Ms. Walsh's leadership experience and deep expertise will be instrumental in helping Hudbay achieve regional milestones and drive growth in Peru with the long-life operations at Constancia, the future development of Caballito and Maria Reyna and further regional exploration.

Holistic Capital Allocation Framework to Deliver Growth and Maximize Long-Term Risk-Adjusted Returns

Hudbay has a proven track record of prudently allocating capital to high-return brownfield investments, such as the New Britannia gold mill refurbishment project and the development of the high-grade Pampacancha satellite deposit, which have delivered significant free cash flows and contributed to Company's deleveraging efforts.

Hudbay has completed a financial transformation over the past three years. The Company has moved from being overleveraged and capital constrained to a preferred position where it can strategically allocate capital across the portfolio to maximize value and generate the highest risk-adjusted returns, creating long-term sustainable value for stakeholders.

Prudent strategic financial planning and execution of the Company's 3-P plan has achieved the Company's balance sheet deleveraging goals and has lowered its cost of capital. With its strongest balance sheet in more than a decade and peer-leading credit metrics, together with the strategic investment by Mitsubishi, Hudbay is very well positioned to sanction the Copper World project and embark on generational investments in the Company's operating portfolio in 2026. These generational investments include allocating capital to high-return brownfield projects at the Company's three operating mines and advance its world-class development and exploration pipeline.

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To provide transparency and continued financial discipline, Hudbay has implemented an enhanced Capital Allocation Framework to provide a holistic approach around capital allocation decisions, including with respect to the deployment of capital into the business through near-term brownfield projects, longer-term greenfield projects, strategic investments and exploration, while considering debt repurchases, share buybacks and dividends.

Hudbay's holistic Capital Allocation Framework is embedded into the Company's annual financial planning cycle and includes the following key elements:

• Preserving Balance Sheet Strength - Aligning with successful deleveraging efforts to maintaining net debt to adjusted EBITDA ratios of less than 1.0x throughout the investment and development cycle, continuing to lower the Company's cost of capital and considering unique (non-dilutive) sources of project funding available.
• Strategic Fit for Growth and Diversification - Expanding and optimizing production and mine life from the existing asset base, enhancing Hudbay's strategic commodity exposure to copper and complementary gold, targeting 400,000 tonnes of annual copper-equivalent production, increasing long-term portfolio diversification across tier-1 jurisdictions and aligning with the Company's sustainability goals.
• Accretive Across Key Financial Metrics - Pursuing investment opportunities that are accretive to a mix of key financial performance metrics-Hudbay's net present value per share, copper-equivalent mineral resources per share, return on invested capital and cash flow yields, as well as demonstrating robust internal rate of returns and project paybacks to maximize value and long-term sustainable returns for all stakeholders.
• Rigorous Risk Assessment - Considering risk-adjusted returns based on project-specific characteristics, applying varying discount rates, commodity price scenarios and sensitivity analysis, as well as key qualitative risk considerations.
• Accountable Investment Governance - Integrating detailed project reviews as part of the annual budgeting process and executing investment decisions subject to a formal internal tollgate process, requiring Executive Committee and Board approval, followed by comprehensive post-project reviews to drive continuous improvement.

Increased Annual Dividend

Following Hudbay's recent financial transformation and consistent with its Capital Allocation Framework, the Company has commenced an increase in shareholder returns in the form of a quarterly dividend. Hudbay's Board of Directors approved the introduction of a new quarterly dividend of C$0.01 per share as the Company has achieved certain financial milestones ahead of schedule and has significantly improved its financial position. The new total annual dividend amount of C$0.04 per share represents an increase of 100% or C$0.02 per share over the previous annual dividend, which was paid semi-annually, representing the first dividend increase in the Company's history.

A quarterly dividend of C$0.01 per share was declared on February 19, 2026. The dividend will be paid out on March 27, 2026 to shareholders of record as of close of business on March 10, 2026.

Climate Change Initiatives   

Since inception of Hudbay's climate change strategy in 2022, the Company continues to implement initiatives to reduce its greenhouse gas ("GHG") footprint. The Company strives to measure efficiency against key process drivers, while recognizing the unique characteristics of each business unit, such as fluctuating strip ratios in open pit mines and changing development profiles at underground mines. In 2025, Hudbay updated its climate change targets with new 2030 GHG emissions reduction targets specific to each business unit and focused on areas where the Company believes it can achieve the biggest impact.     

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The Company has made significant progress towards achieving its climate change goals, including:

• Peru - Hudbay's new 10-year power purchase agreement with ENGIE Energía Perú for access to a 100% renewable energy supply to Constancia came into effect in January 2026. This is expected to be a key contributing factor towards the Peru operations reaching its 2030 target of a 99% reduction in Scope 2 GHG emissions intensity (tonnes of Scope 2 emissions per kilotonne of ore processed) compared to a 2022 baseline.
• Manitoba - Hudbay continues to expand its fleet of electric equipment for use at its underground operations. Following the successful initial trial of an electric Epiroc scooptram ST14 SG at the Lalor mine in 2023, the Company has seen reduced carbon intensity and improved ventilation due to temperature reductions in the deeper areas of the mine. Today, Hudbay has expanded the fleet of battery electric vehicles at Lalor to 10 with two more being added in 2026. Continuing to expand the electric equipment fleet and other operational efficiency initiatives will progress the Snow Lake operations towards its 2030 target of a 25% reduction in Scope 1 GHG emissions intensity (tonnes of Scope 1 emissions per kilometre) compared to a 2022 baseline. 
• British Columbia - At the Copper Mountain mine, efforts to drive operational efficiency continue to be a core focus and will enable the B.C. operations to progress towards its 2030 target of 5% reduction in Scope 1 GHG emissions intensity (tonnes of Scope 1 emissions per kilometre) compared to a 2024 baseline. Hudbay utilizes several pieces of electric equipment at Copper Mountain, including three electric shovels and three electric rotary blasthole drills, which reduces carbon intensity by displacing existing diesel equipment. Additionally, the Company took steps to implement renewable diesel, also known as hydrotreated vegetable oil (HVO) fuel, to power more than 50% of the haul truck fleet in 2025.
• Corporate - Hudbay integrated Scope 1 and Scope 2 GHG emissions into its long-range financial plans to support GHG reduction decision making and alignment with the Company's 2030 goals. The Company also implemented sustainability reporting software to standardize the sustainability data collection process. In January 2025, the Company established an ESG Steering Committee consisting of the COO, CFO and three SVPs to provide enhanced oversight of the Company's sustainability initiatives, procedures and disclosures. Hudbay plans to advance its Scope 3 data collection process in 2026 through supplier and customer engagement to drive transparency and influence positive GHG behaviours throughout the value chain.

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2026 Guidance Reflects Stable Copper and Gold Production, Industry-leading Margins and Investments in High-return Growth Opportunities

Hudbay's key objectives for 2026 are focused on continued operational excellence, advancement of organic growth opportunities, and prudent capital allocation to deliver attractive high-return growth:

1. Demonstrate continued operational excellence to generate substantial free cash flow through consistent copper and gold production, industry-leading cost performance and high-return brownfield reinvestment opportunities.

• Increase mill throughput at Constancia to approximately 90,000 tonnes per day in the second half of 2026 through the installation of two pebble crushers.
• Continue mill throughput improvements at New Britannia and recovery enhancements at the Stall mill.
• Advance the 1901 deposit towards full production by the end of 2027.
• Ramp up mill throughput at Copper Mountain to its permitted capacity of 50,000 tonnes per day in the second half of 2026.

2. Advance attractive organic growth opportunities to deliver significant increase in long-term production.

• Complete the DFS at Copper World in mid-2026 with final sanctioning decision expected in 2026.
• Progress New Ingerbelle permitting and development activities to add production and mine life extension at Copper Mountain.
• Advance economic evaluations of regional satellite properties in Snow Lake, including the Talbot copper-gold-zinc deposit and the New Britanna gold deposit, to further optimize the mine plan and extend mine life.
• Execute extensive Snow Lake exploration program to look for new anchor deposits to meaningfully extend mine life.
• Initiate pre-feasibility study activities at Mason to de-risk project development.
• Advance Flin Flon tailings reprocessing opportunities through pre-feasibility analysis.
• Prepare for exploration activities at Maria Reyna and Caballito to identify high-grade satellite deposits within trucking distance of Constancia's milling infrastructure and provide significant long-term upside potential in Peru.

3. Implement the Capital Allocation Framework to maintain strong financial discipline and maximize returns.

• Continue to reduce total debt outstanding and maintain significant financial flexibility throughout Copper World project build.
• Source the most efficient project level financing for Copper World as part of the Company's prudent financial plan for developing the project.
• Evaluate all types of capital redeployment opportunities, including reinvestments and shareholder returns to generate the highest risk-adjusted returns.

Hudbay's annual production and operating cost guidance, along with its annual capital and exploration expenditure forecasts are discussed in detail below.

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Production Guidance

Contained Metal in Concentrate and Doré1		2026 Guidance	Year Ended Dec. 31, 2025	2025 Guidance
Peru
Copper	tonnes	75,000 - 90,000	85,155	80,000 - 97,000
Gold	ounces	15,000 - 20,000	74,480	49,000 - 60,000
Silver	ounces	1,900,000 - 2,400,000	2,415,134	2,475,000 - 3,025,000
Molybdenum	tonnes	900 - 1,100	1,282	1,300 - 1,500
Manitoba
Gold2	ounces	180,000 - 220,000	173,453	180,000 - 220,000
Zinc	tonnes	16,000 - 21,000	17,646	21,000 - 27,000
Copper	tonnes	10,000 - 13,000	9,249	9,000 - 11,000
Silver2	ounces	800,000 - 1,000,000	800,198	800,000 - 1,000,000
British Columbia
Copper	tonnes	25,000 - 35,000	23,784	28,000 - 41,000
Gold	ounces	22,000 - 32,000	20,001	18,500 - 28,000
Silver	ounces	200,000 - 290,000	252,811	245,000 - 365,000
Total
Copper	tonnes	110,000 - 138,000	118,188	117,000 - 149,000
Gold	ounces	217,000 - 272,000	267,934	247,500 - 308,000
Zinc	tonnes	16,000 - 21,000	17,646	21,000 - 27,000
Silver	ounces	2,900,000 - 3,690,000	3,468,143	3,520,000 - 4,390,000
Molybdenum	tonnes	900 - 1,100	1,282	1,300 - 1,500
1 Metal reported in concentrate and doré is prior to refining losses or deductions associated with smelter terms and includes other secondary products. 2 Gold and silver production guidance includes gold and silver contained in concentrate produced and gold and silver in doré, respectively, and includes other secondary products.

On a consolidated basis, Hudbay successfully achieved 2025 production guidance for its primary metals. 2025 represents the 11^th consecutive year in which Hudbay achieved its annual consolidated copper production guidance, since Constancia declared commercial production, and the 5^th consecutive year achieving its annual consolidated gold production guidance, since establishing standalone gold production guidance^v. Peru achieved the guidance range for copper and exceeded the top end of the gold production guidance range despite the impact from the temporary operational interruption due to social unrest. Peru production of silver and molybdenum fell slightly below the low end of guidance. Manitoba was previously tracking within the 2025 guidance ranges despite the wildfire impacts, but as a result of the weather-related power outage in October and the subsequent ramp-up period required to restore full operational cadence, gold and zinc production fell below the low end of their respective ranges. However, Manitoba achieved guidance for copper and silver production despite these interruptions. British Columbia copper production fell below the low end of the guidance range as a result of the unplanned maintenance at the primary SAG mill in the fourth quarter and a higher than anticipated proportion of lower grade stockpile ore processed through the year. However, gold and silver production in British Columbia achieved guidance ranges despite the lower mill availability in the fourth quarter.

In 2026, consolidated copper production is expected to increase by 5% to 124,000 tonnes^vi. This is driven by higher expected production in British Columbia as a result of mill throughput ramping-up to the targeted 50,000 tonnes per day in the second half of 2026, partially offset by the depletion of the high-grade Pampacancha satellite deposit in December 2025. Consolidated gold production in 2026 is expected to decrease by 9% to 244,500 ounces^vi as a result of the depletion of Pampacancha, but unstreamed gold production is expected to increase in 2026 with higher gold production in Manitoba as operations normalize following unprecedented wildfires in 2025 and continue to achieve strong performance from the New Britannia mill.

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In Peru, 2026 copper production is expected to be 82,500 tonnes^vi, a slight decrease of 3% from 2025 due to the depletion of Pampacancha, which has been largely offset by higher mill throughput and operating efficiencies. Peru expects to install two pebble crushers to increase mill throughput in the second half of 2026, in addition to implementing other mill optimization initiatives. Gold production is expected to decline to 17,500 ounces^vi, lower than 2025 levels as Hudbay optimized the mine plan in 2025 during a period of social unrest by prioritizing Pampacancha mining activities and supplementing mill ore feed from low-grade stockpiles. These short-term mine plan changes resulted in reduced stripping activities in 2025, which is expected to result in some grade re-sequencing in 2026 and higher production in 2027 and 2028. Peru's 2026 production guidance reflects regularly scheduled semi-annual mill maintenance shutdowns at Constancia during the second and fourth quarters of 2026.

In Manitoba, 2026 gold production is expected to be 200,000 ounces^vi, an increase of 15% from 2025, reflecting normalized operations after unprecedented wildfires in 2025, continued strong mill throughput at New Britannia and strong gold grades at Lalor. New Britannia mill throughput is expected to continue to exceed expectations and operate above 2,200 tonnes per day in 2026, far exceeding its original design capacity of 1,500 tonnes per day. The production guidance anticipates Lalor operating at approximately 4,500 tonnes per day, supplemented by 35,000 tonnes of ore feed from the 1901 deposit in 2026. Zinc production for 2026 is expected to be 18,500 tonnes^vi, representing a 5% increase from 2025, driven by higher production from the 1901 deposit.

In British Columbia, 2026 copper production is expected to be 30,000 tonnes^vi, representing a 26% increase from 2025, driven by the completion of the third ball mill to second SAG mill conversion in late 2025. As previously disclosed, Hudbay now expects mill throughput to achieve the targeted 50,000 tonnes per day in the second half of 2026 as opposed to early 2026 due to the impacts of reduced throughput at the primary SAG mill. Installation of the replacement feed end head at the primary SAG mill is scheduled for early in the third quarter of 2026.

Hudbay expects to release an updated three-year production outlook together with its annual mineral reserve and resource update in March 2026.

Cash Cost Guidance

Cash cost1		2026 Guidance	Year Ended Dec. 31, 2025	2025 Guidance
Peru cash cost per pound of copper2	$/lb	1.70 - 2.10	1.08	1.35 - 1.65
Manitoba cash cost per ounce of gold3	$/oz	500 - 800	549	650 - 850
British Columbia cash cost per pound of copper4	$/lb	1.50 - 2.50	3.06	2.45 - 3.45
Consolidated cash cost per pound of copper	$/lb	(0.30) - (0.10)	(0.22)	0.15 - 0.35 (original 0.80 - 1.00)6
Consolidated sustaining cash cost per pound of copper5	$/lb	1.70 - 2.10	1.30	1.85 - 2.25 (original 2.25 - 2.65)6

¹ Cash cost and sustaining cash cost per pound of copper produced, net of by-product credits, and 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.

² Peru cash cost, net of by-product credits, per pound of produced assumes by-product credits are calculated using the gold and silver deferred revenue drawdown rates for the streamed ounces in Peru in effect on December 31, 2025 and the following commodity prices for unstreamed production in 2026: $3,850 per ounce gold and $20.00 per pound molybdenum.

³ Manitoba cash cost, net of by-product credits, per ounce of gold assumes by-product credits are calculated using the following commodity prices for 2026: $4.75 per pound copper, $42.00 per ounce silver, $1.30 per pound zinc and an exchange rate of 1.37 C$/US$.

⁴ British Columbia cash cost, net of by-product credits, per pound of copper assumes by-product credits are calculated using the following commodity price assumptions for 2026: $3,850 per ounce gold, $42.00 per ounce silver and an exchange rate of 1.37 C$/US$.

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⁵ Includes cash sustaining capital expenditures, including payments on capitalized leases and equipment financing, payments on certain long-term community agreements, royalties as well as accretion and amortization for expected decommissioning activities for producing assets.

⁶ Improved full year 2025 consolidated copper cash cost guidance range to $0.15 to $0.35 per pound from prior guidance of $0.65 to $0.85 per pound and the original guidance range of $0.80 to $1.00 per pound. Improved full year 2025 consolidated sustaining copper cash cost guidance range to $1.85 to $2.25 per pound from the original guidance range of $2.25 to $2.65 per pound.

Consolidated cash costⁱ in 2026 is expected to remain at historical lows and be within $(0.30) to $(0.10) per pound of copper, net of by-product credits, benefiting from higher gold production and the Company's continued focus on maintaining strong cost control across the business, driving industry-leading margins. Sustaining cash costⁱ in 2026 is expected to be within $1.70 to $2.10 per pound of copper, net of by-product credits, benefitting from higher copper production and higher by-product credits, offset by higher sustaining capital expenditures, including substantial capital deferrals from 2025.

Copper cash cost in Peru is expected to be between $1.70 to $2.10 per pound in 2026, reflecting steady unit operating cost performance, offset by lower copper production and by-product credits compared to 2025 from the depletion of Pampacancha. 2026 cash costs are positively affected by lower treatment and refining charges and a new power contract lowering electricity rates.

Gold cash cost in Manitoba is expected to be between $500 and $800 per ounce, an increase compared to 2025, but remaining at industry-low levels driving strong margins compared to current gold prices.

Copper cash cost in British Columbia is expected to be between $1.50 and $2.50 per pound in 2026, a decrease compared to 2025 due to higher copper production, higher by-product credits from higher gold production, and higher capitalized stripping related to continued accelerated stripping activities as part of the three-year stabilization and optimization plan at Copper Mountain.

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Capital Expenditure Guidance

Capital Expenditures1,2 (in $ millions)	2026 Guidance	Year Ended Dec. 31, 2025	2025 Guidance
Sustaining capital3
Peru4	140.0	137.0	170.0
Manitoba	105.0	45.7	60.0
British Columbia - sustaining capital	60.0	33.7	50.0
British Columbia - capitalized stripping	130.0	97.7	85.0
Total sustaining capital	435.0	314.1	365.0
Growth capital
Peru	40.0	4.7	25.0
Manitoba	15.0	7.4	15.0
British Columbia	85.0	64.2	75.0
Total growth capital - excl. Copper World JV	140.0	76.3	115.0
Capitalized exploration	25.0	15.6	10.0
Copper World joint venture5	135.0	71.5	110.0

¹ Excludes capitalized costs not considered to be sustaining or growth capital expenditures.

² 2026 Canadian capital expenditures guidance is converted into U.S. dollars using an exchange rate of 1.37 C$/US$ (2025 - 1.35 C$/US$).

³ Sustaining capital guidance excludes right-of-use lease and equipment financing additions, community agreements and non-cash capitalized stripping.

⁴ Includes capitalized stripping and development costs.

⁵ Copper World growth capital shown on a 100% basis. With the announcement of the JV Transaction in August 2025, Hudbay expects to accelerate detailed engineering, long lead items and other de-risking activities by advancing $20 million in growth capital expenditures to 2025 from future years, updating total 2025 Copper World joint venture growth spending guidance to $110 million compared to the original 2025 guidance of $90 million. Approximately $35 million of the 2025 updated growth spending was deferred to 2026.

Total sustaining capital in 2025 was approximately $50 million lower than guidance due to approximately $10 million lower capitalized stripping in Peru from the impact of social unrest, approximately $10 million lower capitalized development at Lalor due to the impact of wildfires, and approximately $38 million in sustaining capital deferrals to 2026, partially offset by $13 million higher capitalized stripping in British Columbia. Excluding Copper World project costs, growth capital in 2025 was approximately $39 million lower than guidance primarily due to timing of expenditure and a majority is expected to be deferred to 2026. Copper World growth spending in 2025 was approximately $39 million lower than guidance due to timing of expenditure, a majority of which will be deferred to 2026.

2026 total capital spending includes approximately $96 million of capital deferrals from 2025, higher growth capital spending as Hudbay reinvests in several high-return growth projects and one-time sustaining capital expenditures at the operations as discussed below.

Peru 2026 sustaining capital expenditures are expected to be maintained at $140 million, which includes $20 million of sustaining capital deferrals to 2026 and $18 million in one-time heavy civil works projects, offset by lower spending on tailings dam raises. Peru 2026 growth capital expenditures of $40 million relate primarily to the installation of two pebble crushers to increase mill throughput starting in the second half of 2026 and includes $13 million in capital deferrals from 2025.

Manitoba 2026 sustaining capital expenditures are expected to temporarily increase to $105 million in 2026 primarily as a result of $20 million in one-time expenditures related to a project at New Britannia to lower nitrogen levels, $12 million for an accelerated one-year construction schedule for a dam raise at the Anderson tailings facility and $5 million in capital deferrals from 2025. Underground capitalized development at Lalor is expected to return to normal levels after reduced levels in 2025 from the wildfires. Manitoba growth capital expenditures are expected to be $15 million in 2026 and relate primarily to the development of exploration platforms and haulage drifts at the 1901 deposit. Manitoba spending guidance excludes approximately $15 million of annual care and maintenance costs related to the Flin Flon facilities in 2026, which are expected to be recorded as other operating expenses.

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British Columbia 2026 sustaining capital expenditures are expected to increase to $60 million in 2026 primarily as a result of $5 million in one-time expenditures related to the replacement of the feed end head at the primary SAG and $13 million in capital deferrals from 2025. In addition, Hudbay expects to incur approximately $130 million of capitalized stripping costs in 2026 related to continued accelerated stripping activities as the final year of the three-year stabilization and optimization plan at Copper Mountain. To ensure positive cash flows in British Columbia as the Company executes the last year of accelerated stripping activities, during the first quarter of 2026, the Company entered into copper forward sales contracts at an average price of $6.02 per pound and a zero-cost copper collar program at an average floor price of $5.75 per pound and cap price of $6.34 per pound on approximately 20% of 2026 copper production in British Columbia. British Columbia growth capital expenditures are expected to increase to $85 million in 2026 and includes $10 million in capital deferrals from 2025. Growth capital spending primarily relates to early works and infrastructure development for the New Ingerbelle expansion project.

Copper World joint venture 2026 growth capital guidance of $135 million primarily relates to feasibility study costs and continued de-risking until a Copper World project sanctioning decision, including approximately $60 million for accelerated long lead items and de-risking activities and $35 million of capital deferrals from 2025, and excludes post-project sanction construction costs which will be updated at the time of project sanction.

Exploration Guidance

Exploration Expenditures (in $ millions)	2026 Guidance	Year Ended Dec. 31, 2025	2025 Guidance
Peru1	15.0	15.9	19.0
Manitoba2	50.0	33.0	30.0
British Columbia	20.0	7.7	1.0
Total exploration expenditures	85.0	56.6	50.0
Capitalized spending	(25.0)	(15.6)	(10.0)
Total exploration expense	60.0	41.0	40.0
1 Peru exploration expenditures exclude approximately $6 million of non-cash amortization of community agreements for exploration properties for 2026 (2025 - $5 million). 2 Manitoba exploration partially funded by approximately $20 million in Canadian Exploration Expense flow-through financing proceeds for 2026 (2025 - $10 million).

Total 2026 exploration expenses are expected to increase to $60 million from $41 million in 2025 as Hudbay continues to execute a multi-year extensive geophysics and drilling program in Snow Lake to extend mine life and explore for new discoveries and focus on the conversion of high value inferred resources at New Ingerbelle, as described below.

In Manitoba, 2026 exploration activities will focus on completing the largest geophysics program in the Company's history, including 800 kilometres of ground electromagnetic surveys and an extensive airborne geophysics survey. The Company plans to complete underground and surface drilling at Lalor to continue expanding its mineral resource and reserve estimates and underground drilling at 1901 from the new exploration drift. In addition, Hudbay plans to continue drilling activities at several regional targets in 2026, including the Talbot deposit and at other regional prospective areas, following up on encouraging results in 2025. A portion of the 2026 Manitoba exploration program will be funded by approximately $20 million in proceeds from a critical minerals premium flow-through financing completed in late 2025.

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In British Columbia, 2026 exploration activities will focus on the conversion of high value inferred resources at New Ingerbelle to potentially extend mine life at Copper Mountain.

In Peru, 2026 exploration activities will continue to focus on final permitting and drill preparation for the Maria Reyna and Caballito properties near Constancia.

Website Links

Hudbay: www.hudbay.com

Management's Discussion and Analysis:

https://www.hudbayminerals.com/MDA226

Financial Statements:

https://www.hudbayminerals.com/FS226

Conference Call and Webcast

Date:	Friday, February 20, 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., Director, Global Exploration and 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.

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              2026 No. 4

Supplemental Information for Talbot Drill Holes

	From			To			Azimuth at intercept	Dip at intercept
Hole ID	Easting	Northing	Elevation	Easting	Northing	Elevation
TLS024	458,517	5,997,397	-1,196	458,512	5,997,399	-1,206	297.7	-64.3
TLS025 top	458,301	5,996,995	-1,097	458,296	5,996,997	-1,110	291.8	-68.0
TLS025 bottom	458,293	5,996,998	-1,119	458,291	5,996,999	-1,124	291.7	-67.9
TLS026	458,322	5,997,184	-906	458,318	5,997,185	-913	282.2	-64.2
TLS027W02	458,241	5,997,008	-881	458,233	5,997,012	-898	297.0	-60.2

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.

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Adjusted Net Earnings (Loss) Reconciliation

		Three Months Ended									Year Ended
(in $ millions)		Dec. 31, 2025			Sep. 30, 2025			Dec. 31, 2024			Dec. 31, 2025			Dec. 31, 2024
Net earnings for the period		128.0			222.4			19.3			564.3			67.8
Tax expense		129.1			108.1			84.4			347.7			183.8
Earnings before tax		257.1			330.5			103.7			912.0			251.6
Adjusting items:
Mark-to-market adjustments1		(5.7	)		8.7			(10.3	)		6.2			27.1
Foreign exchange loss (gain)		(5.4	)		8.8			17.4			(18.6	)		21.0
Re-evaluation adjustment - environmental provision		(0.2	)		1.4			2.5			0.2			(3.5	)
Manitoba cost of sales and other expense from temporary shutdown		0.5			24.2			-			30.0			-
Peru cost of sales from temporary shutdown		2.1			10.9			-			13.0
Insurance Recovery		(25.0	)		-			-			(25.0	)		-
Consideration received from sale of      non-core project		-			(14.9	)		-			(14.9	)		-
Copper World impairment reversal		-			(322.3	)		-			(322.3	)		-
Variable consideration adjustment - stream revenue and accretion		-			-			-			(10.5	)		4.0
Inventory adjustments		0.7			(1.3	)		1.3			4.1			2.9
Restructuring charges		-			-			-			0.1			1.2
Reduction of obligation to renounce flow-through share expenditures, net of provisions		(1.6	)		(0.8	)		1.0			(5.5	)		(2.0	)
Loss/write-down (reversal of) on disposal  of PP&E		2.9			(0.3	)		14.1			3.5			27.4
Changes in other provisions (non-capital)		-			-			-			0.7			-
Adjusted earnings before income taxes		225.4			44.9			129.7			573.0			329.7
Tax expense		(129.1	)		(108.1	)		(84.4	)		(347.7	)		(183.8	)
Tax impact on adjusting items		(10.3	)		73.3			23.4			37.1			30.8
Adjusted net earnings		86.0			10.1			68.7			262.4			176.7
Adjusted net earnings attributable to non-controlling interest:
Net loss (earnings) for the period		-			-			1.9			4.2			8.9
Adjusting items, including tax impact		-			-			(0.3	)		(1.1	)		(4.2	)
Adjusted net earnings - attributable to owners		86.0			10.1			70.3			265.6			181.4
Adjusted net earnings ($/share) - attributable to owners		0.22			0.03			0.18			0.67			0.48
Basic weighted average number of common shares outstanding (millions)		396.3			395.7			394.0			395.5			376.8

¹ Includes changes in fair value of the gold prepayment liability, Canadian junior mining investments, other financial assets and liabilities at fair value through profit or loss and share-based compensation expenses (recoveries). Also includes gains and losses on disposition of investments.

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Adjusted EBITDA Reconciliation

		Three Months Ended									Year Ended
(in $ millions)		Dec. 31, 2025			Sep. 30, 2025			Dec. 31, 2024			Dec. 31, 2025			Dec. 31, 2024
Net earnings for the period		128.0			222.4			19.3			564.3			67.8
Add back:
Tax expense		129.1			108.1			84.4			347.7			183.8
Net finance expense		(14.6	)		19.6			34.4			19.4			148.7
Other expense		(13.6	)		9.1			22.1			7.8			57.4
Depreciation and amortization		152.5			82.7			122.2			439.7			426.6
Amortization of deferred revenue and variable consideration adjustment		(24.0	)		(6.3	)		(26.2	)		(75.0	)		(70.5	)
Adjusting items (pre-tax):
Impairment reversal		-			(322.3	)		-			(322.3	)		-
Consideration received from sale of Eva Copper Project		-			(14.9	)		-			(14.9	)		-
Re-evaluation adjustment - environmental provision		(0.2	)		1.4			2.5			0.2			(3.5	)
Inventory adjustments		0.7			(1.3	)		1.3			4.1			2.9
Overhead costs incurred during Manitoba temporary suspension (cash)		-			16.0			-			19.2			-
Overhead costs incurred during Peru temporary suspension (cash)		1.3			7.3			-			8.6			-
Option agreement proceeds (Marubeni)		0.9			1.1			-			4.5			(0.4	)
Realized loss on non-QP hedges		-			-			(4.2	)		(2.3	)		(8.9	)
Share-based compensation expenses1		25.8			19.7			1.5			59.9			18.6
Adjusted EBITDA		385.9			142.6			257.3			1,060.9			822.5

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

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Net Debt Reconciliation

(in $ millions)
		Dec. 31, 2025			Sep. 30, 2025			Dec. 31, 2024
Total debt		1,008.6			1,047.0			1,107.5
Less: Cash and cash equivalents		(568.9	)		(611.1	)		(541.8	)
Less: Short-term investments		-			-			(40.0	)
Net debt		439.7			435.9			525.7
(in $ millions, except net debt to adjusted EBITDA ratio)
Net debt		439.7			435.9			525.7
Adjusted EBITDA (12-month period)		1,060.9			932.3			822.5
Net debt to adjusted EBITDA		0.4			0.5			0.6

Trailing Adjusted EBITDA		Three Months Ended
(in $ millions)		Dec. 31, 2025			Sep. 30, 2025			Jun. 30, 2025			Mar. 31, 2025			Dec. 31, 2024
Earnings (loss) for the period		128.0			222.4			114.7			99.2			19.3
Add back:
Tax expense		129.1			108.1			38.4			72.1			84.4
Net finance expense		(14.6	)		19.6			-			14.4			34.4
Other expenses		(13.6	)		9.1			7.1			5.2			22.1
Depreciation and amortization		152.5			82.7			96.4			108.1			122.2
Amortization of deferred revenue and variable consideration adjustment		(24.0	)		(6.3	)		(15.4	)		(29.3	)		(26.2	)
Adjusting items (pre-tax):
Impairment reversal		-			(322.3	)		-			-			-
Consideration received from Eva Copper Project		-			(14.9	)		-			-			-
Re-evaluation adjustment - environmental provision		(0.2	)		1.4			(13.8	)		12.8			2.5
Inventory adjustments		0.7			(1.3	)		3.5			1.2			1.3
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		-			-			(0.4	)		(1.9	)		(4.2	)
Option agreement proceeds (Marubeni)		1.1			1.1			1.0			1.5			-
Share-based compensation expenses1		25.8			19.7			10.5			3.9			1.5
Adjusted EBITDA		385.9			142.6			245.2			287.2			257.3
LTM2		1,060.9			932.3			995.7			895.7

¹ Share-based compensation expense reflected in cost of sales and administrative expenses.
² LTM (last twelve months) as of December 31, 2025. Annual consolidated results may not be calculated based on the amounts presented in this table due to rounding.

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Free Cash Flow Reconciliation

(in $ millions)		Three Months Ended									Year Ended
		Dec. 31, 2025			Sep. 30, 2025			Dec. 31, 2024			Dec. 31, 2025			Dec. 31, 2024
Cash generated from operations		209.4			113.5			238.1			707.3			666.2
Adjusting items:
Change in non-cash working capital		(127.5	)		43.2			6.6			(57.0	)		(24.9	)
Cash sustaining capital expenditures1		108.7			85.5			82.6			376.4			334.0
Free cash flow		228.2			(15.2	)		148.9			387.9			357.1
Cash sustaining capital expenditures1
Total sustaining capital costs		91.8			71.2			71.6			314.1			293.1
Capitalized lease and equipment financing cash payments - operating sites		12.5			14.3			10.3			53.0			38.4
Community agreement cash payments		4.4			-			0.7			9.3			2.5
Cash sustaining capital expenditures1		108.7			85.5			82.6			376.4			334.0

		Three Months Ended												LTM2
(in $ millions)		Dec. 31, 2025			Sep. 30, 2025			Jun. 30, 2025			Mar. 31, 2025
Cash generated from operations		209.4			113.5			259.6			124.8			707.3
Adjusting items:
Change in non-cash working capital		(127.5	)		43.2			66.0			(38.7	)		(57.0	)
Cash sustaining capital expenditures1		108.7			85.5			106.1			76.1			376.4
Free cash flow		228.2			(15.2	)		87.5			87.4			387.9
Cash sustaining capital expenditures1
Total sustaining capital costs		91.8			71.2			88.6			62.5			314.1
Capitalized lease and equipment financing cash payments - operating sites		12.5			14.3			13.4			12.8			53.0
Community agreement cash payments		4.4			-			4.1			0.8			9.3
Cash sustaining capital expenditures1		108.7			85.5			106.1			76.1			376.4

¹ Excludes 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 December 31, 2025

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              2026 No. 4

Copper Cash Cost Reconciliation

Consolidated		Three Months Ended									Year Ended
Net pounds of copper produced1
(in thousands)		Dec. 31, 2025			Sep. 30, 2025			Dec. 31, 2024			Dec. 31, 2025			Dec. 31, 2024
Peru		55,199			39,934			74,931			187,734			218,260
Manitoba		7,333			1,856			7,379			20,391			27,637
British Columbia2		10,373			11,572			13,067			52,435			58,215
Net pounds of copper produced		72,905			53,362			95,377			260,560			304,112

¹ Contained copper in concentrate.

Consolidated		Three Months Ended
		Dec. 31, 2025							Sep. 30, 2025									Dec. 31, 2024
Cash cost per pound of copper produced		$ millions			$/lb				$ millions				$/lb				$ millions				$/lb
Mining		103.2			1.42				70.2				1.32				108.1				1.13
Milling		96.5			1.32				75.8				1.42				95.4				1.00
G&A		73.4			1.01				31.8				0.59				50.6				0.53
Onsite costs		273.1			3.75				177.8				3.33				254.1				2.66
Treatment & refining		5.8			0.08				5.3				0.10				25.9				0.27
Freight & other		25.1			0.34				14.9				0.28				28.6				0.30
Cash cost, before by-product credits		304.0			4.17				198.0				3.71				308.6				3.23
By-product credits		(350.0	)		(4.80		)		(175.8		)		(3.29		)		(265.5		)		(2.78	)
Cash cost, net of by-product credits		(46.0	)		(0.63		)		22.2				0.42				43.1				0.45

		Year Ended
		Dec. 31, 2025						Dec. 31, 2024
Cash cost per pound of copper produced		$ millions			$/lb			$ millions			$/lb
Mining		350.4			1.34			394.0			1.30
Milling		345.5			1.33			352.1			1.16
G&A		191.9			0.74			162.8			0.54
Onsite costs		887.8			3.41			908.9			3.00
Treatment & refining		28.4			0.11			97.3			0.31
Freight & other		85.1			0.33			101.1			0.33
Cash cost, before by-product credits		1,001.3			3.84			1,107.3			3.64
By-product credits		(1,057.8	)		(4.06	)		(967.4	)		(3.18	)
Cash cost, net of by-product credits		(56.5	)		(0.22	)		139.9			0.46

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Consolidated		Three Months Ended
		Dec. 31, 2025						Sep. 30, 2025									Dec. 31, 2024
Supplementary cash cost information		$ millions			$/lb1			$ millions					$/lb1				$ millions					$/lb1
By-product credits2:
Zinc		12.2			0.17			9.9					0.18				16.1					0.17
Gold3		302.2			4.15			134.8					2.53				212.9					2.23
Silver3		27.3			0.37			13.9					0.26				26.6					0.28
Molybdenum & other		8.3			0.11			17.2					0.32				9.9					0.10
Total by-product credits		350.0			4.80			175.8					3.29				265.5					2.78
Reconciliation to IFRS:
Cash cost, net of by-product credits		(46.0	)					22.2									43.1
By-product credits		350.0						175.8									265.5
Treatment and refining charges		(5.8	)					(5.3			)						(25.9			)
Share-based compensation expense		2.6						1.7									0.7
Inventory adjustments		0.7						(1.3			)						1.3
Past service costs		-						-									1.5
Change in product inventory		4.3						(19.6			)						(10.0			)
Royalties		3.2						2.0									2.1
Overhead costs incurred during Manitoba temporary suspension (cash)		-						16.0									-
Overhead costs incurred during Peru temporary suspension (cash)		1.3						7.3									-
Depreciation and amortization4		152.5						82.7									122.2
Cost of sales5		462.8						281.5									400.5

							Year Ended
							Dec. 31, 2025									Dec. 31, 2024
Supplementary cash cost information							$ millions					$/lb1				$ millions					$/lb1
By-product credits2:
Zinc							43.2					0.17				69.9					0.23
Gold3							858.2					3.29				747.8					2.46
Silver3							90.7					0.35				86.0					0.28
Molybdenum & other							65.7					0.25				63.7					0.21
Total by-product credits							1,057.8					4.06				967.4					3.18
Reconciliation to IFRS:
Cash cost, net of by-product credits							(56.5			)						139.9
By-product credits							1,057.8									967.4
Treatment and refining charges							(28.4			)						(97.3			)
Share-based compensation expense							5.9									1.9
Inventory adjustments							4.1									2.9
Past service costs							-									4.3
Change in product inventory							8.1									11.4
Royalties							9.3									10.3
Overhead costs incurred during Manitoba temporary suspension (cash)							19.2									-
Overhead costs incurred during Peru temporary suspension (cash)							8.6									-
Depreciation and amortization4							439.7									426.6
Cost of sales5							1,467.8									1,467.4

¹ Per pound of copper produced.

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

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 December 31, 2025 the variable consideration adjustments amounted to $nil (three months ended December 31, 2024 - $nil and September 30, 2025 - $nil). For the year ended December 31, 2025 the variable consideration adjustments amounted to a gain of $9.9 million (year ended December 31, 2024 - loss of $3.8 million).

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⁴ Depreciation is based on concentrate sold.

⁵ As per consolidated financial statements.

Peru

Three Months Ended

Year Ended

(in thousands)

Dec. 31, 2025

Sep. 30, 2025

Dec. 31, 2024

Dec. 31, 2025

Dec. 31, 2024

Net pounds of copper produced1

55,199

39,934

74,931

187,734

218,260

¹ Contained copper in concentrate.

Peru		Three Months Ended
		Dec. 31, 2025						Sep. 30, 2025									Dec. 31, 2024
Cash cost per pound of copper produced		$ millions			$/lb			$ millions					$/lb				$ millions				$/lb
Mining		37.6			0.68			34.8					0.87				47.3				0.63
Milling		52.0			0.94			40.8					1.02				53.6				0.72
G&A		47.8			0.87			19.3					0.48				33.2				0.44
Onsite costs		137.4			2.49			94.9					2.37				134.1				1.79
Treatment & refining		2.5			0.05			3.4					0.08				16.0				0.21
Freight & other		17.3			0.31			9.4					0.24				19.2				0.25
Cash cost, before by-product credits		157.2			2.85			107.7					2.69				169.3				2.25
By-product credits		(126.0	)		(2.28	)		(55.5			)		(1.39		)		(94.0		)		(1.25		)
Cash cost, net of by-product credits		31.2			0.57			52.2					1.30				75.3				1.00

						Year Ended
						Dec. 31, 2025										Dec. 31, 2024
Cash cost per pound of copper produced						$ millions						$/lb				$ millions				$/lb
Mining						131.5						0.70				145.5				0.67
Milling						195.0						1.04				197.1				0.90
G&A						112.8						0.60				95.5				0.44
Onsite costs						439.3						2.34				438.1				2.01
Treatment & refining						12.5						0.07				53.4				0.24
Freight & other						54.3						0.29				62.5				0.29
Cash cost, before by-product credits						506.1						2.70				554.0				2.54
By-product credits						(303.5				)		(1.62		)		(295.8		)		(1.36	)
Cash cost, net of by-product credits						202.6						1.08				258.2				1.18

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Peru		Three Months Ended
		Dec. 31, 2025							Sep. 30, 2025							Dec. 31, 2024
Supplementary cash cost information		$ millions				$/lb1			$ millions				$/lb1			$ millions				$/lb1
By-product credits2:
Gold3		104.7				1.90			31.3				0.78			68.5				0.91
Silver3		13.2				0.24			7.0				0.18			16.8				0.22
Molybdenum		8.1				0.14			17.2				0.43			8.7				0.12
Total by-product credits		126.0				2.28			55.5				1.39			94.0				1.25
Reconciliation to IFRS:
Cash cost, net of by-product credits		31.2							52.2							75.3
By-product credits		126.0							55.5							94.0
Treatment and refining charges		(2.5		)					(3.4		)					(16.0		)
Inventory adjustments		(0.2		)					(1.3		)					(0.2		)
Share-based compensation expenses		0.5							0.2							0.1
Change in product inventory		15.6							(26.9		)					(6.7		)
Royalties		2.9							1.5							1.5
Overhead costs incurred during Peru temporary suspension (cash)		1.3							7.3							-
Depreciation and amortization4		115.8							50.0							83.2
Cost of sales5		290.6							135.1							231.2

						Year Ended
						Dec. 31, 2025								Dec. 31, 2024
Supplementary cash cost information						$ millions				$/lb1				$ millions				$/lb1
By-product credits2:
Gold3						188.3				1.00				182.5				0.84
Silver3						49.5				0.26				51.3				0.24
Molybdenum						65.7				0.36				62.0				0.28
Total by-product credits						303.5				1.62				295.8				1.36
Reconciliation to IFRS:
Cash cost, net of by-product credits						202.6								258.2
By-product credits						303.5								295.8
Treatment and refining charges						(12.5		)						(53.4		)
Inventory adjustments						-								-
Share-based compensation expenses						1.0								0.5
Change in product inventory						6.5								9.6
Royalties						6.5								6.7
Overhead costs incurred during Peru temporary suspension (cash)						8.6								-
Depreciation and amortization4						290.0								270.3
Cost of sales5						806.2								787.7

¹ Per pound of copper produced.

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

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

⁴ Depreciation is based on concentrate sold.

⁵ As per the consolidated financial statements.

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British Columbia

Three Months Ended

Year Ended

(in thousands)

Dec. 31, 2025

Sep. 30, 2025

Dec. 31, 2024

Dec. 31, 2025

Dec. 31, 2024

Net pounds of copper produced1

10,373

11,572

13,067

52,435

58,215

¹ Contained copper in concentrate.

British Columbia		Three Months Ended
		Dec. 31, 2025						Sep. 30, 2025						Dec. 31, 2024
Cash cost per pound of copper produced		$ millions			$/lb			$ millions			$/lb			$ millions			$/lb
Mining		26.3			2.54			19.6			1.69			18.2			1.39
Milling		28.3			2.73			29.1			2.52			25.2			1.93
G&A		9.5			0.91			7.1			0.61			4.6			0.35
Onsite costs		64.1			6.18			55.8			4.82			48.0			3.67
Treatment & refining		1.3			0.12			1.0			0.09			3.4			0.26
Freight & other		2.7			0.26			3.0			0.26			2.4			0.19
Cash cost, before by-product credits		68.1			6.56			59.8			5.17			53.8			4.12
By-product credits		(18.1	)		(1.74	)		(22.7	)		(1.96	)		(14.6	)		(1.12	)
Cash cost, net of by-product credits		50.0			4.82			37.1			3.21			39.2			3.00
								Year Ended
								Dec. 31, 2025						Dec. 31, 2024
Cash cost per pound of copper produced								$ millions			$/lb			$ millions			$/lb
Mining								92.0			1.76			79.1			1.36
Milling								100.6			1.92			89.8			1.54
G&A								29.0			0.55			19.6			0.34
Onsite costs								221.6			4.23			188.5			3.24
Treatment & refining								8.0			0.15			14.4			0.25
Freight & other								12.4			0.23			13.2			0.22
Cash cost, before by-product credits								242.0			4.61			216.1			3.71
By-product credits								(81.3	)		(1.55	)		(56.5	)		(0.97	)
Cash cost, net of by-product credits								160.7			3.06			159.6			2.74

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British Columbia		Three Months Ended																		Year Ended
		Dec. 31, 2025						Sep. 30, 2025						Dec. 31, 2024						Dec. 31, 2025						Dec. 31, 2024
Supplementary cash cost information		$millions			$/lb1			$millions			$/lb1			$millions			$/lb1			$millions			$/lb1			$millions			$/lb1
By-product credits2:
Gold		14.9			1.43			20.4			1.76			13.3			1.02			71.2			1.36			49.3			0.85
Silver		3.2			0.31			2.3			0.20			1.3			0.10			10.1			0.19			7.2			0.12
Total by-product credits		18.1			1.74			22.7			1.96			14.6			1.12			81.3			1.55			56.5			0.97
Reconciliation to IFRS:
Cash cost, net of by-product credits		50.0						37.1						39.2						160.7						159.6
By-product credits		18.1						22.7						14.6						81.3						56.5
Treatment and refining charges		(1.3	)					(1.0	)					(3.4	)					(8.0	)					(14.4	)
Share based payment		0.7						0.5						0.4						1.7						0.4
Change in product inventory		(9.1	)					4.2						(3.0	)					(2.1	)					3.8
Inventory adjustments		0.1						-						1.2						2.3						1.2
Royalties		0.3						0.5						0.6						2.8						3.6
Depreciation and amortization3		14.1						16.4						11.8						63.3						50.1
Cost of sales4		72.9						80.4						61.4						302.0						260.8

¹ Per pound of copper produced.

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

³ Depreciation is based on concentrate sold.

⁴ As per consolidated financial statements.

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Sustaining and All-in Sustaining Cash Cost Reconciliation

Consolidated	Three Months Ended
			Dec. 31, 2025						Sep. 30, 2025						Dec. 31, 2024
All-in sustaining cash cost per pound of copper produced			$millions			$/lb			$millions			$/lb			$millions			$/lb
Cash cost, net of by-product credits			(46.0	)		(0.63	)		22.2			0.42			43.1			0.45
Cash sustaining capital expenditures			111.2			1.53			87.5			1.64			85.3			0.89
Royalties			3.2			0.04			2.0			0.03			2.1			0.03
Sustaining cash cost, net of by-product credits			68.4			0.94			111.7			2.09			130.5			1.37
Corporate selling and administrative expenses & regional costs			32.0			0.44			33.0			0.62			11.6			0.12
Accretion and amortization of decommissioning and community agreements1			4.0			0.05			3.9			0.07			3.7			0.04
All-in sustaining cash cost, net of by-product credits			104.4			1.43			148.6			2.78			145.8			1.53
Reconciliation to property, plant and equipment additions
Property, plant and equipment additions			140.9						97.6						127.6
Capitalized stripping net additions			43.9						43.2						35.8
Total accrued capital additions			184.8						140.8						163.4
Less other non-sustaining capital costs2			93.0						69.6						91.8
Total sustaining capital costs			91.8						71.2						71.6
Capitalized lease & equipment financing cash payments - operating sites			12.5						14.3						10.3
Community agreement cash payments3			4.4						-						0.7
Accretion and amortization of decommissioning and restoration obligations4			2.5						2.0						2.7
Cash sustaining capital expenditures			111.2						87.5						85.3

¹ Includes accretion of decommissioning relating to non-productive sites, and accretion and amortization of current community agreements.

² Other 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.

³ Amortization for community agreements relating to current operations.

⁴ Includes amortization of decommissioning and restoration PP&E assets and accretion of decommissioning and restoration liabilities related to producing sites.

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Consolidated		Year Ended
		Dec. 31, 2025						Dec. 31, 2024
All-in sustaining cash cost per pound of copper produced		$millions			$/lb			$millions			$/lb
Cash cost, net of by-product credits		(56.5	)		(0.22	)		139.9			0.46
Cash sustaining capital expenditures		385.2			1.48			342.2			1.13
Royalties		9.3			0.02			10.3			0.03
Sustaining cash cost, net of by-product credits		338.0			1.30			492.4			1.62
Corporate selling and administrative expenses & regional costs		102.4			0.39			62.4			0.20
Accretion and amortization of decommissioning and community agreements1		13.1			0.05			17.3			0.06
All-in sustaining cash cost, net of by-product credits		453.5			1.74			572.1			1.88
Reconciliation to property, plant and equipment additions:
Property, plant and equipment additions		400.3						325.7
Capitalized stripping net additions		182.2						160.5
Total accrued capital additions		582.5						486.2
Less other non-sustaining capital costs2		268.4						193.1
Total sustaining capital costs		314.1						293.1
Capitalized lease & equipment financing cash payments - operating sites		53.0						38.4
Community agreement cash payments3		9.3						2.5
Accretion and amortization of decommissioning and restoration obligations4		8.8						8.2
Cash sustaining capital expenditures		385.2						342.2

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

² Other 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.

³ Amortization for community agreements relating to current operations.

⁴ Includes amortization of decommissioning and restoration PP&E assets and accretion of decommissioning and restoration liabilities related to producing sites.

Peru		Three Months Ended																		Year Ended
		Dec. 31, 2025						Sep. 30, 2025						Dec. 31, 2024						Dec. 31, 2025						Dec. 31, 2024
Sustaining cash cost per pound of copper produced		$millions			$/lb			$millions			$/lb			$millions			$/lb			$millions			$/lb			$millions			$/lb
Cash cost, net of by-product credits		31.2			0.57			52.2			1.30			75.3			1.00			202.6			1.08			258.2			1.18
Cash sustaining capital expenditures		50.3			0.91			30.5			0.77			34.3			0.46			171.2			0.91			141.6			0.65
Royalties		2.9			0.05			1.5			0.04			1.5			0.02			6.5			0.03			6.7			0.03
Sustaining cash cost per pound of copper produced		84.4			1.53			84.2			2.11			111.1			1.48			380.3			2.02			406.5			1.86

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British Columbia		Three Months Ended																		Year Ended
		Dec. 31, 2025						Sep. 30, 2025						Dec. 31, 2024						Dec. 31, 2025						Dec. 31, 2024
Sustaining cash cost per pound of copper produced		$millions			$/lb			$millions			$/lb			$millions			$/lb			$millions			$/lb			$millions			$/lb
Cash cost, net of by-product credits		50.0			4.82			37.1			3.21			39.2			3.00			160.7			3.00			159.6			2.74
Cash sustaining capital expenditures		41.7			4.02			48.4			4.18			35.4			2.71			157.5			3.00			144.5			2.48
Royalties		0.3			0.03			0.5			0.04			0.6			0.05			2.8			0.06			3.6			0.07
Sustaining cash cost per pound of copper produced		92.0			8.87			86.0			7.43			75.2			5.76			321.0			6.12			307.7			5.29

Gold Cash Cost and Sustaining Cash Cost Reconciliation

Manitoba

Three Months Ended

Year Ended

(in thousands)

Dec. 31, 2025

Sep. 30, 2025

Dec. 31, 2024

Dec. 31, 2025

Dec. 31, 2024

Net ounces of gold produced1

47,423

22,441

51,438

173,453

214,225

¹ Contained gold in concentrate and doré.

Manitoba		Three Months Ended
		Dec. 31, 2025							Sep. 30, 2025								Dec. 31, 2024
Cash cost per ounce of gold produced		$millions			$/oz				$millions				$/oz				$millions					$/oz
Mining		39.3			829				15.8				704				42.6					828
Milling		16.2			342				5.9				263				16.6					323
G&A		16.1			339				5.4				241				12.8					249
Onsite costs		71.6			1,510				27.1				1,208				72.0					1,400
Treatment & refining		2.0			42				0.9				40				6.5					126
Freight & other		5.1			108				2.5				111				7.0					136
Cash cost, before by-product credits		78.7			1,660				30.5				1,359				85.5					1,662
By-product credits		(45.3	)		(955		)		(22.0		)		(980		)		(54.3			)		(1,055	)
Gold cash cost, net of by-product credits		33.4			705				8.5				379				31.2					607

			Year Ended
			Dec. 31, 2025						Dec. 31, 2024
Cash cost per ounce of gold produced			$millions			$/oz			$millions			$/oz
Mining			126.9			731			169.4			791
Milling			49.9			288			65.2			304
G&A			50.1			289			47.7			223
Onsite costs			226.9			1,308			282.3			1,318
Treatment & refining			7.9			45			29.5			137
Freight & other			18.4			106			25.4			119
Cash cost, before by-product credits			253.2			1,459			337.2			1,574
By-product credits			(157.9	)		(910	)		(207.3	)		(968	)
Gold cash cost, net of by-product credits			95.3			549			129.9			606

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Manitoba		Three Months Ended
		Dec. 31, 2025						Sep. 30, 2025						Dec. 31, 2024
Supplementary cash cost information		$millions			$/oz1			$millions			$/oz1			$millions			$/oz1
By-product credits2:
Copper		22.1			466			7.4			330			28.5			554
Zinc		12.2			257			9.9			441			16.1			313
Silver		10.8			228			4.7			209			8.5			165
Other		0.2			4			-			-			1.2			23
Total by-product credits		45.3			955			22.0			980			54.3			1,055
Reconciliation to IFRS:
Cash cost, net of by-product credits		33.4						8.5						31.2
By-product credits		45.3						22.0						54.3
Treatment and refining charges		(2.0	)					(0.9	)					(6.5	)
Inventory adjustments		0.8						-						0.3
Past service cost		-						-						1.5
Share-based compensation expenses		1.4						1.0						0.2
Change in product inventory		(2.2	)					3.1						(0.3	)
Overhead costs incurred during temporary suspension		-						16.0						-
Depreciation and amortization3		22.6						16.3						27.2
Cost of sales4		99.3						66.0						107.9

		Year Ended
		Dec. 31, 2025						Dec. 31, 2024
Supplementary cash cost information		$millions			$/oz1			$millions			$/oz1
By-product credits2:
Copper		83.6			482			108.2			505
Zinc		43.2			249			69.9			326
Silver		31.1			179			27.5			128
Other		-			-			1.7			9
Total by-product credits		157.9			910			207.3			805
Reconciliation to IFRS:
Cash cost, net of by-product credits		95.3						129.9
By-product credits		157.9						207.3
Treatment and refining charges		(7.9	)					(29.5	)
Inventory adjustments		1.8						1.7
Past service cost		-						4.3
Share-based compensation expenses		3.2						1.0
Change in product inventory		3.7						(2.0	)
Overhead costs incurred during Manitoba temporary suspension (cash)		19.2						-
Depreciation and amortization3		86.4						106.2
Cost of sales4		359.6						418.9

¹ Per ounce of gold produced.

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

³ Depreciation is based on concentrate sold.

⁴ As per consolidated financial statements.

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Manitoba		Three Months Ended																		Year Ended
		Dec. 31, 2025						Sep. 30, 2025						Dec. 31, 2024						Dec. 31, 2025						Dec. 31, 2024
Sustaining cash cost per ounce of gold produced		$millions			$/oz			$millions			$/oz			$millions			$/oz			$millions			$/oz			$millions			$/oz
Gold cash cost, net of by-product credits		33.4			705			8.5			379			31.2			607			95.3			549			129.9			606
Cash sustaining capital expenditures		19.2			405			8.6			383			15.5			301			56.5			326			56.1			262
Sustaining cash cost per ounce of gold produced		52.6			1,110			17.1			762			46.7			908			151.8			875			186.0			868

Combined Unit Cost Reconciliation

Peru		Three Months Ended									Year Ended
(in millions except ore tonnes milled and unit cost per tonne)
Combined unit cost per tonne processed		Dec. 31, 2025			Sep. 30, 2025			Dec. 31, 2024			Dec. 31, 2025			Dec. 31, 2024
Mining		37.6			34.8			47.3			131.5			145.5
Milling		52.0			40.8			53.6			195.0			197.1
G&A1		47.8			19.3			33.2			112.8			95.5
Other G&A2		(26.7	)		(3.8	)		(12.1	)		(44.9	)		(25.9	)
Unit cost		110.7			91.1			122.0			394.4			412.2
Tonnes ore milled		7,628			6,992			7,999			30,293			31,934
Combined unit cost per tonne		14.51			13.03			15.25			13.02			12.91
Reconciliation to IFRS
Unit cost		110.7			91.1			122.0			394.4			412.2
Freight & other		17.3			9.4			19.2			54.3			62.5
Inventory adjustments		(0.2	)		(1.3	)		(0.2	)		-			-
Other G&A		26.7			3.8			12.1			44.9			25.9
Share-based compensation expenses		0.5			0.2			0.1			1.0			0.5
Change in product inventory		15.6			(26.9	)		(6.7	)		6.5			9.6
Royalties		2.9			1.5			1.5			6.5			6.7
Overhead costs incurred during Peru temporary suspension (cash)		1.3			7.3			-			8.6			-
Depreciation and amortization		115.8			50.0			83.2			290.0			270.3
Cost of sales3		290.6			135.1			231.2			806.2			787.7

¹ G&A as per cash cost reconciliation above.

² Other G&A primarily includes profit sharing costs.

³ As per consolidated financial statements.

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British Columbia		Three Months Ended									Year Ended
(in millions except tonnes ore milled and unit cost per tonne)
Combined unit cost per tonne processed		Dec. 31, 2025			Sep. 30, 2025			Dec. 31, 2024			Dec. 31, 2025			Dec. 31, 2024
Mining		26.3			19.6			18.2			92.0			79.1
Milling		28.3			29.1			25.2			100.6			89.8
G&A1		9.5			7.1			4.6			29.0			19.6
Unit cost		64.1			55.8			48.0			221.6			188.5
USD/CAD implicit exchange rate		1.41			1.38			1.38			1.40			1.37
Unit cost - C$		90.3			77.3			66.9			309.7			258.1
Tonnes ore milled		2,268			3,087			2,881			11,017			12,657
Combined unit cost per tonne - C$		39.80			25.02			23.22			28.12			20.39
Reconciliation to IFRS:
Unit cost		64.1			55.8			48.0			221.6			188.5
Freight & other		2.7			3.0			2.4			12.4			13.2
Share-based compensation expenses		0.7			0.5			0.4			1.7			0.4
Change in product inventory		(9.1	)		4.2			(3.0	)		(2.1	)		3.8
Inventory adjustments		0.1			-			1.2			2.3			1.2
Royalties		0.3			0.5			0.6			2.8			3.6
Depreciation and amortization		14.1			16.4			11.8			63.3			50.1
Cost of sales2		72.9			80.4			61.4			302.0			260.8

¹ G&A as per cash cost reconciliation above

² As per consolidated financial statements.

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Manitoba		Three Months Ended									Year Ended
(in millions except tonnes ore milled and unit cost per tonne)
Combined unit cost per tonne processed		Dec. 31, 2025			Sep. 30, 2025			Dec. 31, 2024			Dec. 31, 2025			Dec. 31, 2024
Mining		39.3			15.8			42.6			126.9			169.4
Milling		16.2			5.9			16.6			49.9			65.2
G&A1		16.1			5.4			12.8			50.1			47.7
Less: Other G&A related to profit sharing costs		(9.4	)		(1.8	)		(4.0	)		(25.6	)		(17.0	)
Unit cost		62.2			25.3			68.0			201.3			265.3
USD/CAD implicit exchange rate		1.39			1.39			1.39			1.40			1.37
Unit cost - C$		86.7			35.3			95.0			282.4			363.5
Tonnes ore milled		349,082			136,705			407,596			1,197,335			1,608,708
Combined unit cost per tonne - C$		248			258			233			236			226
Reconciliation to IFRS:
Unit cost		62.2			25.3			68.0			201.3			265.3
Freight & other		5.1			2.5			7.0			18.4			25.4
Other G&A related to profit sharing		9.4			1.8			4.0			25.6			17.0
Share-based compensation expenses		1.4			1.0			0.2			3.2			1.0
Inventory adjustments		0.8			-			0.3			1.8			1.7
Past service cost		-			-			1.5			-			4.3
Change in product inventory		(2.2	)		3.1			(0.3	)		3.7			(2.0	)
Overhead costs incurred during Manitoba temporary suspension (cash)		-			16.0			-			19.2			-
Depreciation and amortization		22.6			16.3			27.2			86.4			106.2
Cost of sales2		99.3			66.0			107.9			359.6			418.9

¹ G&A as per cash cost reconciliation above.

² As per consolidated financial statements.

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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.

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 ongoing second SAG mill conversion and configuration project and 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 permitting and development timelines associated with New Ingerbelle, the estimated timelines and pre-requisites for sanctioning the Copper World project, expectations regarding the anticipated benefits of the JV Transaction and the sanctioning of the Copper World project to Hudbay and the United States, the consummation and timing of the DFS in respect 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, 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 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 tax synergies, expectations regarding the ability to conduct exploration work and execute on exploration programs on its properties and to advance related drill plans, including the advancement of the exploration program at Maria Reyna and Caballito and the status and anticipated timing of the related drill permit application process, expectations regarding the prospective nature of the Maria Reyna and Caballito properties, 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, the enhancement of stakeholder engagement and advancement of a pre-feasibility study and related test work at the Mason copper project in Nevada, 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.

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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 any successful challenges to the Copper World permits;
• Hudbay's ability to successfully advance and complete the optimization of the Copper Mountain operations, obtain required permits 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 associated with reaching a definitive agreement with Wheaton in respect of the enhanced precious metals stream, risks related to the failure to effectively advance and complete the optimization of the Copper Mountain mine operations including with respect to the ongoing second SAG mill conversion and configuration project and 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 related to the Copper World project, including in relation to project delivery 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, 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.

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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.

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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 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 (loss) - attributable to owners and adjusted net earnings (loss) 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 The post-closing adjusted year-end cash and cash equivalents of $992 million includes December 31, 2025 cash and cash equivalents balance of $568.9 million and approximately $420 million of cash at the Copper World LLC level, which is designated for exclusive use by the Copper World joint venture. Post-closing adjusted liquidity includes the post-closing cash and cash equivalent plus the undrawn availability of $424.8 million under Hudbay's revolving credit facilities.

ⁱⁱⁱ Based on the initial capital investment and the $3.75 per pound copper price used in the PFS published on September 8, 2023 with assumptions of approximately $145 million for pre-sanctioning costs, $230 million from the precious metals stream, $350 million from project-level financing and approximately $700 million from Mitsubishi's $420 million initial investment, $180 million investment within 18 months and its pro-rata 30% share of future equity capital contributions.

^iv For further information regarding the terms agreed to with Wheaton Precious Metals Corp. to enhance and amend the existing precious metals streaming agreement, please see Hudbay's August 13, 2025 news release.

^v In 2020, Hudbay's consolidated copper production guidance range was revised during the year due to the impact of COVID-19 at the operations. Hudbay's 2020 copper production was within the revised guidance ranges. Prior to 2021, Hudbay provided guidance on a precious metal equivalent instead of gold as a standalone metal.

^vi Calculated using the midpoint of the guidance range.

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FAQ

How did Hudbay Minerals (HBM) perform financially in 2025?

Hudbay Minerals reported much stronger 2025 results, with revenue of $2,211.0 million and net income of $564.3 million, compared with $2,021.2 million revenue and $67.8 million net income in 2024, reflecting higher profitability and a significant impairment reversal.

What were Hudbay Minerals (HBM) 2025 earnings per share?

In 2025, Hudbay Minerals delivered basic and diluted earnings per share of $1.44, up from $0.20 in 2024. This increase stems from substantially higher net income attributable to owners of the company of $568.5 million compared with $76.7 million a year earlier.

How strong was Hudbay Minerals (HBM) cash flow from operations in 2025?

Hudbay generated solid 2025 operating cash flow of $707.3 million, versus $666.2 million in 2024. Operating cash flow before working capital changes reached $764.3 million, supporting significant capital expenditures and enabling debt reduction and other financing activities during the year.

What changes occurred in Hudbay Minerals (HBM) debt and equity in 2025?

At year-end 2025, Hudbay’s long-term debt declined to $536.5 million from $1,107.5 million, while equity attributable to owners rose to $3,231.0 million. The company also repurchased $102.1 million of senior unsecured notes and eliminated non-controlling interest.

Did Hudbay Minerals (HBM) record any major impairment or reversal in 2025?

Yes. Hudbay recognized an impairment reversal of $322.3 million in 2025, which significantly boosted results from operating activities. The company also performed its annual goodwill impairment test for the British Columbia cash‑generating unit and concluded there was no goodwill impairment.

What did the auditors conclude about Hudbay Minerals (HBM) 2025 financials and controls?

Deloitte LLP issued unqualified opinions on Hudbay’s 2025 consolidated financial statements and its internal control over financial reporting as of December 31, 2025. Management also concluded that internal control over financial reporting was effective, based on the COSO 2013 framework.

Filing Exhibits & Attachments

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• EX-99.1 EXHIBIT 99.1 1.8 MB
• EX-99.2 EXHIBIT 99.2 1.6 MB
• EX-99.3 EXHIBIT 99.3 1.3 MB