On Thursday, Novagold Resources (AMEX:NG) discussed third-quarter financial results during its earnings call. The full transcript is provided below.

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Summary

Novagold Resources is undergoing a significant transaction to become the sole owner of the Donlin Gold Project, establishing a new U.S.-domiciled parent company, New Novagold Resources, which will be listed on the NYSE.

The transaction aims to boost shareholder value by increasing gold reserves and production, projecting Donlin as the largest single gold mine in the U.S. with significant annual production.

The company reported a third-quarter net loss of $36 million, primarily due to increased expenditures on the Donlin Gold Bankable Feasibility Study and higher G&A expenses.

Novagold Resources' treasury at the end of the third quarter was $343.4 million, and the company is well-funded to complete the feasibility study by 2027.

Strategic initiatives include engaging with local communities, advancing permitting processes, and scaling internal capacity to support project milestones.

Management remains optimistic about the gold market's future and the potential value creation from the Donlin Gold Project, which they believe is positioned well within the global gold sector.

Full Transcript

OPERATOR

Thank you for standing by. This is the conference operator. Please go ahead.

Mélanie Hennessey, Vice President, Corporate Communications

Good morning everyone. We are pleased that you have joined us for Novagold Resources' 2026 third quarter webcast and conference call and for an update on the Donlin Gold Project. On today's call we have Novagold Resources' Chairman, Dr. Thomas Kaplan, President and CEO Greg Lang, and Peter Adamek, Novagold Resources' Vice President and CFO. At the end of the webcast we will take questions by phone. Additionally, we will respond to questions received by email.

Please note that while we provide commentary on our pending transaction to acquire 100% of Donlin Gold during the prepared remarks portion of today's call, we will not be addressing any questions or providing further comments regarding the transaction during the Q&A portion of the call. For additional information regarding the transaction, we direct you to the Management Information Circular and proxy statements and other documents filed by Novagold Resources with the SEC on the SEC's website and under Novagold Resources' profile on SEDAR at sedarplus.ca, or from Novagold Resources' website at novagold.com.

As stated on Slide 3, any statements made today may contain forward-looking information such as projections and goals which are likely to involve risk detailed in our various SEC and SEDAR filings and the forward-looking disclaimers included in this presentation. With that, I will now turn the presentation over to Novagold Resources' President and CEO, Greg Lang.

Greg Lang, President and CEO

Thank you, Mélanie. I will start my remarks by highlighting several key activities that took place during the quarter, starting with positioning the company as the premier U.S. gold developer through a series of definitive agreements entered into on July 21st. Under this proposed transaction, as depicted on Slide 5, a new U.S.-domiciled parent company, New Novagold Resources, will be established and listed on the New York Stock Exchange. This will be done with a one-to-one share exchange.

Dr. Thomas Kaplan, our current Chair, and John Paulson will become co-chairs of New Novagold Resources. Inclusive of the existing ownership in Novagold Resources, Paulson will own approximately 40% of New Novagold Resources and its voting interest will be capped at 19.99%. Once closed, New Novagold Resources will become the ultimate parent company, acquiring Paulson's 40% interest in an all-share transaction and will then own 100% of Donlin. This transaction requires two-thirds shareholder approval along with other court, regulatory, listing, and customary closing conditions.

The meeting of special shareholders is scheduled for November 3, 2026 and the voting deadline is October 30th, with closing expected by the end of the year. This transaction gives shareholders equity in a well-capitalized developer with ownership of the strategic asset projected to be the largest single gold mine in the United States, with an anticipated market capitalization of about $5 billion. The transaction is expected to deliver immediate benefits to stakeholders by increasing net asset value, gold reserves, and resources per share.

Specifically, it adds approximately 16 million ounces of measured and indicated resources, including 13 million ounces in proven and probable reserves, and this boosts the attributable annual production by over 520,000 ounces during the first decade. Beyond the numbers, consolidating ownership under one parent company streamlines corporate decision-making and improves capital efficiency while maintaining independent governance through specific voting and lock-up restrictions.

The structure also creates a single point of contact for our key stakeholders including landowners Calista Corporation and The Kuskokwim Corporation. As highlighted on Slide 7, Donlin Gold is positioned to become one of the highest annual gold producers in the Americas on both a resource and production basis, with projected production of approximately 1.1 million ounces per year over its 27-year mine life, comparing very favorably when looking at some of America's largest gold companies like Agnico Eagle, Equinox, and others that are listed on the chart.

As mentioned earlier, once the transaction closes, the company is expected to have a market capitalization of approximately $5 billion, placing it among some of the largest gold companies in the industry. As shown on Slide 8, this transaction is immediately accretive to Novagold Resources shareholders across key share metrics including NAV per share and gold resources per share. In our view, having John Paulson and Dr. Thomas Kaplan serve as co-chairs following the close of this transaction will provide Novagold Resources with a uniquely aligned and experienced leadership team as the company advances Donlin Gold and considers opportunities to fund its future development. As shown on Slide 10, Mr. Paulson brings a distinguished track record as a gold investor, including his long-standing commitment to Novagold Resources and his experience in identifying and investing in high-quality, differentiated gold assets. Combined with Dr. Kaplan's deep knowledge of Donlin Gold and long-standing leadership of Novagold Resources, their shared conviction, complementary expertise, market reach, and alignment with shareholders should position the company to advance the project efficiently and maximize long-term shareholder value.

On Slide 11, we show Novagold Resources' share price movement over the last two years. The strategic alignment between Novagold Resources and Paulson has helped reignite investor confidence and share price momentum, reflecting the market's growing recognition of Donlin Gold's value and the potential benefits of a more streamlined ownership and development structure. As shown on Slide 12, Donlin Gold continued to extensively engage with government and regional stakeholders while supporting local programs across the Y-K region.

During the third quarter, we coordinated with Calista to conduct a series of village visits, including a dedicated community meeting in Crooked Creek, the closest village to the project, to provide general updates and discuss the subsistence plan. Additionally, we facilitated several key initiatives for the Subsistence Community Advisory Committee, including meetings on communication plans and a tour of the Red Dog Mine. On the infrastructure front, we are advancing our planning along the proposed pipeline corridor.

We've initiated outreach to over 190 individuals and entities in the region while coordinating closely with legislators in neighboring boroughs, engaging with key decision-makers at the state and local levels, including recently holding briefings with Senator Dan Sullivan and collaborating with the DOE on permitting and infrastructure. Donlin's ongoing support of rural activities through Excel Alaska and health and safety initiatives provide key touch points in the region.

Lastly, environmental stewardship remains a core priority. We completed the 2026 George River Salmon Monitoring Program in coordination with the Native Village of Napaimute, sampling over 7,000 fish, and we continued biodiversity monitoring at Snow Gulch to further strengthen our environmental baseline data. Turning to Slide 13, several workstreams on the technical front continue to advance. The Bankable Feasibility Study remains on track for completion in 2027.

A team led by Fluor is currently integrating major work packages and coordinating with specialist contractors including WSP, Worley, and Hatch. Geotechnical work is wrapping up this fall at key sites including the Jungjuk Port and the access road corridor, while resource modeling and mine planning are progressing as planned toward a high-quality Bankable Feasibility Study. We are also scaling our internal capacity to support these technical and operational milestones.

Since the start of 2026, we have more than doubled our team from 35 to over 70 employees across Anchorage and Vancouver, and we continue to recruit for critical roles as the project advances toward a final investment decision. As shown on Slide 14, in the third quarter we announced the appointment of Endeavour Financial and Macquarie Capital as financial advisors. They will help us evaluate various funding alternatives ranging from conventional project finance to potential support from sovereign wealth funds, ensuring that our financing strategy is executed in tandem with the Bankable Feasibility Study to preserve long-term shareholder value.

I will now turn the presentation over to Novagold Resources' Vice President and Chief Financial Officer, Peter Adamek.

Peter Adamek, Vice President and Chief Financial Officer

Thank you, Greg. Turning to our operating performance on Slide 16, Novagold Resources reported a fiscal 2026 third quarter net loss of $36 million, or $0.08 per share. Novagold Resources' net loss during the third quarter increased by $20.4 million from the comparable prior year period, primarily due to higher Donlin Gold expenditures as a result of ongoing Bankable Feasibility Study activities and higher Novagold Resources G&A expenses, partially offset by higher interest income in the current year.

The company's share of Donlin Gold expenses in the third quarter of 2026 was $16.6 million higher than the comparative prior year period due to ongoing 2026 activities by Fluor, WSP, Worley, and Hatch to advance Donlin Gold's Bankable Feasibility Study. Novagold Resources G&A expenses increased in the third quarter of 2026 by $5.7 million from the comparable prior year period, primarily due to higher ongoing legal and professional fees related to the proposed transaction to acquire 100% of Donlin Gold announced on July 22, 2026.

Legal and professional fees are expected to remain elevated for the balance of fiscal 2026 and into early 2027 until we complete the previously announced transaction. On Slide 17, our treasury, comprising cash and term deposits, decreased by $26.8 million to $343.4 million during the third quarter, reflecting $24.8 million of funding of Donlin Gold and $9.8 million of Novagold Resources' corporate G&A costs, partially offset by $3.8 million in interest income and $1.2 million in proceeds from the sale of marketable securities.

Corporate G&A cash expenditures during the third quarter increased by $5.5 million and our share of Donlin Gold funding increased by $16.7 million compared to the prior year, for reasons discussed on the previous slide. Moving to Slide 18, our treasury at the end of the third quarter was a very robust $343.4 million. Novagold Resources is well funded, enabling us to complete the Donlin Gold Bankable Feasibility Study in 2027, exercise our option to prepay the Barrick promissory note during the current quarter, and cover our corporate G&A costs for at least the next 12 months.

As noted earlier, our legal and professional fees have been elevated in 2026 and are expected to remain elevated for the balance of the year and into early 2027 until we complete the previously announced transaction. As such, we have increased our 2026 corporate G&A guidance by $11.5 million to $31.2 million to support the completion of the transaction to acquire 100% of Donlin Gold. I will now turn the presentation over to Greg to discuss the third quarter highlights.

Greg Lang, President and CEO

Thank you, Peter. It's worth reflecting on the value created through the company's long-term commitment to advancing the Donlin Gold Project over the past two decades. Extensive drilling and exploration programs have significantly increased Donlin's reserves and resources. The company successfully advanced permitting for the Donlin Gold Project, representing an important step in its development. In June 2025, Novagold Resources and Paulson jointly acquired Barrick's 50% interest in Donlin, increasing Novagold Resources' ownership to 60% and Paulson's to 40%.

Looking even further back, a key milestone occurred in 2008 and 2010 when Electrum and Paulson became major shareholders of Novagold Resources. That commitment has continued through recent announcements to consolidate Paulson's remaining interest in Donlin, bringing Novagold Resources' ownership to 100%. These events, combined with the project's attributes of scale, grade, location, and production profile, underpin the value creation and an incredible investment opportunity.

Many of our shareholders view Novagold Resources as an unexpiring warrant on an ounce of gold. On slide 21, the bar chart illustrates the post-tax net present value at various gold prices, both on the current ownership basis and a pro forma basis following the proposed consolidation. With gold prices above $4,000 an ounce, this reflects a value of over $50 billion at a 0% discount rate, or approximately $20 billion at a 5% discount rate. This projection underscores the substantial economic potential of the Donlin Gold Project in the current market environment.

As slide 22 highlights, Donlin Gold is positioned to become one of the highest annual gold producers in the world, projected to produce 1.3 million ounces annually in the first 10 years of production and over 1 million ounces of gold annually over its 27-year mine life. Looking at slide 23, Donlin Gold hosts approximately 40 million ounces of measured and indicated resources at an average grade of about two and a quarter grams per tonne. This is more than twice the industry average.

The project's exceptional scale, strong grade, and long mine life provide a robust foundation for value creation and position Donlin to remain resilient across a wide range of gold price environments. Moving to slide 24, we believe there are significant exploration opportunities beyond the current resources in the Acma and Lewis pits, as illustrated in the graphic in the upper right-hand corner, which covers approximately 3 kilometers of the 8-kilometer gold-bearing trend, representing just a small portion of our overall land package.

This underscores the potential to add ounces and extend the mine life through further exploration. As slide 10 outlines, Donlin Gold's current permitting status and the advantages of its location in Alaska. With a well-established regulatory framework and supportive approach to responsible resource development, collaboration with state and federal agencies remains constructive. At the state level, we continue to support Alaska in defending the Clean Water Act Section 404 certification, with a decision anticipated within the coming year following oral arguments which were made on June 3 this year.

At the federal level, the Army Corps of Engineers and the Bureau of Land Management published the Supplemental Environmental Impact Statement on September 23rd of this year, analyzing a larger theoretical tailings release. All permits remain in place, with public comments open through October 23rd and the final EIS anticipated in April 2027. Dam safety permitting also advanced as expected, with detailed design packages for the project's seven dams anticipated by the end of the year or early '27, and the issuance of dam safety certificates is expected in 2028.

On slide 26, we highlight a quote from Governor Mike Dunleavy, who's expressed strong backing for responsible resource development in Alaska, including the Donlin Gold Project. We appreciate his advocacy and look forward to continuing open and constructive communications with him and his team. Turning to slide 27, we highlight our long-standing collaboration and ongoing engagement with Calista and TKC, whose roles as private landowners are integral to the success of Donlin Gold.

Their shared commitment to responsible development, grounded in deep local knowledge and stewardship, supports job creation, long-term economic opportunities, and the preservation of cultural heritage across the YK region. Novagold Resources is supported by a seasoned management team, as shown on slide 28, with a proven track record of mine development across the Americas. Our team is complemented by the Donlin Gold Project execution team, including Frank Arquese, and supported leading contractors including Fluor, WSP, Worley, and Hatch.

Together they bring deep technical and project execution expertise to advance Donlin Gold efficiently, responsibly, and with a strong focus on execution discipline. We deeply appreciate the continued support and confidence of our long-term shareholders, some of whom are highlighted on slide 29. Novagold Resources remains committed to responsibly advancing the Donlin Gold Project, delivering on key milestones, and fulfilling our commitments. We sincerely thank our shareholders, stakeholders, our Board of Directors, and the entire Donlin Gold team for their continued support, trust, dedication, and hard work.

The recently announced consolidation of Donlin Gold represents an important milestone for our shareholders, simplifying the ownership structure and increasing Novagold Resources' direct exposure to the significant value and long-term potential of the project. We believe this positions Novagold Resources to capture greater value from Donlin Gold for the benefit of our shareholders as we continue to advance the project and build on the momentum created in the last year.

In closing, slide 30 summarizes the core attributes that distinguish Donlin Gold as a truly differentiated asset within the global gold sector. Donlin Gold combines exceptional scale, high-grade open pit mineralization, a long mine life, low projected operating costs, significant exploration potential, and a stable jurisdiction. A project that stands apart among large-scale gold development opportunities, with the bankable feasibility study and subsequent stages of development ahead.

Donlin Gold is supported by an experienced leadership and project execution team, strong relationships with local landowners, and a clear commitment to responsible development, providing a strong foundation for disciplined advancement and long-term shareholder value. Operator, we are now prepared to take questions.

Mélanie Hennessey, Vice President, Corporate Communications

Again, please remember that we will not be addressing any questions or providing further comments regarding the pending transaction during the Q&A portion of the call.

OPERATOR

We will now begin the question and answer session. To join the question queue, you may press star then 1 on your telephone keypad. You'll hear a tone acknowledging your request. If you're using a speakerphone, please pick up your handset before pressing any keys. To withdraw your question, please press star then 2. Once again, if you have a question, please press star then 1.

Mélanie Hennessey, Vice President, Corporate Communications

We have a few questions from the line of Matt Kovacs online last quarter. Matt thanked you for your integrity and family perspective regarding Novagold Resources, and that's directed to Dr. Kaplan. Again, thank you for your commitment. Not to get political, but the current administration seems very bullish in the progression of mining precious metals. Would you see any reason to expedite? What are your thoughts on the administration?

Thomas S. Kaplan, Chairman

First of all, thank you for the question and thank you for your continued support for Novagold Resources. Thank you. One of the very nice things about the Donlin project is that we haven't been a political football. We were permitted under President Obama. Those permits were defended under President Biden. Needless to say, the Trump administration has expressed a very ardent passion for Alaska, and we do benefit from that. We haven't had to request assistance regarding permitting because we have the permits that we need to advance.

We have our federal permits, so we haven't needed the support of the administrations, but we've always had it. We've had bipartisan political support in Alaska. If there are opportunities to be able to accelerate the timeline for Donlin, and I think that there could be, they involve the fact that a number of countries have committed hundreds of billions of dollars to investment in the United States: Japan, 550 billion; Korea, 350 billion; countries in the Gulf, the UAE, etc. Hundreds and hundreds of billions of dollars. Being able to participate in what will be the largest single gold mine in the United States in a bull market in gold, located in a state that is already the second-largest gold producer in the United States after Nevada, we believe that this is a very compelling case for those who want to invest in the United States to be able to do so. If you're an Asian country and your investment is on the Pacific Coast of Alaska, already investment grade for you, that's not a deterrent, it's the opposite.

It's an inducement. And similarly, all the countries that I mentioned are bullish consumers of gold. The Japanese, the Emiratis, the South Korean central bank has officially reinitiated its gold purchase program. So we do believe that we benefit from the tailwinds of the gold bull market. We benefit from the tailwinds of gravitation towards jurisdictional safety. We benefit from the tailwinds of those who have made commitments to investing in the United States under this administration being able to see that one of the offerings in the buffet is America's largest gold mine, which we think is going to assist us in the financing that we are working on in parallel with all of the work that you heard Greg referring to on the ground.

Mélanie Hennessey, Vice President, Corporate Communications

Thank you. The next question is also from the line of Matt Kovacs and addressed to Dr. Kaplan. I have been hearing a rumor of an eight-year bull cycle coming to an end for gold soon. Do you believe that we will see a gold price near 5,000 in the next six months? Thanks again, Matt.

Thomas S. Kaplan, Chairman

The short answer is yes, but the bigger answer is I believe that we are just in the foothills of the gold bull market. I don't see this as an eight-year bull market. I see this as being a pullback within the context of a much longer wave that will take gold far beyond 5,000, will take gold far beyond the highs this year. And in fact, I have said publicly that I can easily see gold going into the tens of thousands. I believe that we have not even gotten started.

And the comparison that I make, and I did this before we had gold, the peak and the pullback, is to the Dow Jones, which began its bull market when it broke through a thousand definitively in around 1980, reached 3,650-ish. We had the crash of 1987, which you can barely see on a long-term chart. It's so tiny in comparison to what happens next. That took it down to about 2,650, and then it began to chug along to taking us to 50,000. I think that we are embarked upon something the likes of which people have not really had the opportunity to experience since the great bull market in the equities markets of the last decades.

So the short answer is, yes, we are going to see 5,000. The longer answer is, I believe that that is just scratching the surface of one of the biggest bull markets that will have been seen in modern history. For many years, people would ask me which currency to own. And I would say, if you're looking at what I would call colloquially paper currencies, unless you are nimble and can look at things like the Swiss franc or the Singapore dollar, et cetera, for the US Dollar. All paper currencies are toilet tissue. But the US Dollar for a number of reasons is double ply. And I would say, but if you want the currency that's going to be the best performer against everything, that's gold. And both of those things, I think, have been good advice. People would say that seems mutually exclusive to say, buy the dollar and buy gold. And I said, that's a myth. There are many myths about gold. It was a myth that you have to have strong commodities for gold to prosper.

That's not true. Oil, you know, is barely where it was 20 years ago. You don't need to have inflation. We didn't have inflation and gold multiplied in value. The dollar is stronger now than it was 20 years ago. So what you're really dealing with is a duck. It looks like a duck, it tastes like a duck, it quacks like a duck, it walks like a duck, it's a duck. And I can't say what I think the dollar will do against other paper currencies. I really don't know because we're in a very, very different environment when it comes to the underpinnings of what made the dollar double ply.

So I'm just agnostic, but my comment has been against gold, the dollar will collapse. And if you look at gold through that lens, if you take the chart which shows gold going parabolic and you just flip it over, I would ask you to see it as a currency against the dollar. And it's very daunting to be a dollar bull against gold. So it's a long-term trend. We're in the early phases of it, like I would say the 1987-ish washout that we saw in the Dow Jones.

But this is not over at all. And this pullback, whenever it ends, will be, to my mind, if past is prologue, the definitive end leading to the next long wave in gold.

Mélanie Hennessey, Vice President, Corporate Communications

Thank you. With no further questions, I will hand it back over to Greg for closing remarks.

Greg Lang, President and CEO

Well, thank you, Melanie. And thank you everyone for taking the time to listen to our quarterly update today. Take care.

OPERATOR

This brings to a close today's conference call. You may disconnect your lines. Thank you for participating and have a pleasant day.

Disclaimer: This transcript is provided for informational purposes only. While we strive for accuracy, there may be errors or omissions in this automated transcription. For official company statements and financial information, please refer to the company's SEC filings and official press releases. Corporate participants' and analysts' statements reflect their views as of the date of this call and are subject to change without notice.