Gold, Lead and What Else Is in the RockThin moat

KGHM Polska Miedź (KGH) — moat facet

A third tier of metals that costs nothing incremental and could not fill a silver-sized hole.

After copper and silver, the same ore yields a third tier of metals that are individually small and collectively worth having.

The by-product tiers, H1 2026 parent revenue (zl m)5 843Silver895GoldRefined lead 29,9 kt and Sierra Gorda molybdenum 5,0m lbs are smaller still
Gold is real money and a tenth of the credit. If silver halved, nothing in the third tier would fill the hole.

The parent produced 88,6 thousand ounces of gold and 29,9 thousand tonnes of refined lead in 20251. Gold revenue in the first half of 2026 was 895 million złoty, up 61,6%2 — real money, and about 4% of the parent's revenue. Sierra Gorda adds molybdenum, 5,0 million pounds in 20253.

The reason to care about the third tier is that it behaves like the second. Every one of these metals is a by-product of copper mining that KGHM would extract anyway, so each carries essentially no marginal cost and each subtracts directly from the cost of the copper. Together with the silver they are what turns 52 201 złoty a tonne into 17 4154.

The reason not to care too much is scale. Gold at 895 million złoty a half-year against silver at 5 843 million5 is a tenth of the credit; lead and molybdenum are smaller still. If the silver price halved, no combination of the others would fill the hole.

KGHM's new strategy leans on this tier, proposing to extend the portfolio toward nickel, cobalt, platinum-group metals and eventually lithium and rare earths6. That is a sensible direction and a distant one.

The measure is the share of the by-product credit that comes from something other than silver. Today it is small, and until it is not, this is a silver story with attachments.

Moat trajectory: Holding steady

Gold revenue rose 61,6% in the first half of 2026 on a base too small to change the outcome. Nothing in the third tier is scaling.

The number that tests this moat
Reported
Gold revenue in the half
895m zł, up 61,6%

The third tier - gold, lead and Sierra Gorda's molybdenum - costs nothing incremental and subtracts directly from the cost of copper. It is also a tenth the size of the silver credit. Watch the share of the by-product credit coming from something other than silver; until it grows, this is a silver story with attachments.

Source: KGHM Group Management Board's report for H1 2026 ↗
⚠ Threats to the moat
⚠ THREAT 01
The Smaller Metals Stay Small
Copper and silver are 92% of parent revenue; the multi-commodity portfolio is a direction, not a business.
References
  1. ReportedThe parent produced 88,6 thousand ounces of gold and 29,9 thousand tonnes of refined lead in 2025.
    KGHM Polska Miedz S.A. Group - Management Board's report on activities in 2025, the production and unit-cost record (electrolytic copper of 570,9 thousand tonnes against 588,7 in 2024, 592,4 in 2023 and 560,4 in 2020; metallic silver of 1 323 tonnes against 1 403 in 2023; C1 payable copper production cost of 3,16 USD/lb for the Polish assets against 1,03 for KGHM INTERNATIONAL and 0,86 for Sierra Gorda; group payable copper of 710,0 thousand tonnes against 753,7 in 2021; wire rod and wire production of 279,9 thousand tonnes; and world mined silver production of about 25,3 thousand tonnes) — FY2018-FY2025 · publ. 10 March 2026 · source ↗
  2. ReportedGold revenue in the first half of 2026 was 895 million złoty, up 61,6% — real money, and about 4% of the parent's revenue.
    KGHM Polska Miedz S.A. Group - Management Board's report on activities in the first half of 2026, financial results (revenue of 24 711m złoty up 40,8%, profit for the period of 5 579m against 580m, adjusted EBITDA of 9 198m up 89,1%, capital expenditure of 1 663m, net debt down 13,5% to 4 691m, equity of 39 814m, available financing of 16 978m, and the 1 979m złoty increase in the minerals extraction tax on higher copper and silver prices) — H1 2026 · publ. August 2026 · source ↗
  3. ReportedSierra Gorda adds molybdenum, 5,0 million pounds in 2025.
    KGHM Polska Miedz S.A. Group - Management Board's report on activities in 2025, the production and unit-cost record (electrolytic copper of 570,9 thousand tonnes against 588,7 in 2024, 592,4 in 2023 and 560,4 in 2020; metallic silver of 1 323 tonnes against 1 403 in 2023; C1 payable copper production cost of 3,16 USD/lb for the Polish assets against 1,03 for KGHM INTERNATIONAL and 0,86 for Sierra Gorda; group payable copper of 710,0 thousand tonnes against 753,7 in 2021; wire rod and wire production of 279,9 thousand tonnes; and world mined silver production of about 25,3 thousand tonnes) — FY2018-FY2025 · publ. 10 March 2026 · source ↗
  4. ReportedTogether with the silver they are what turns 52 201 złoty a tonne into 17 415.
    KGHM Polska Miedz S.A. Group - Management Board's report on activities in the first half of 2026, production, unit costs and employment (electrolytic copper of 291,5 thousand tonnes of which 183,6 thousand from own concentrate, metallic silver of 696,7 tonnes, the pre-precious-metals-credit unit cost of 52 201 złoty a tonne against a total unit cost of 17,415, C1 of 2,44 USD/lb, average group employment of 34 543 including 18 870 at the parent, and payable copper from the international assets of 59,5 thousand tonnes of which Sierra Gorda 40,2 and Robinson 17,7) — H1 2026 · publ. August 2026 · source ↗
  5. ReportedGold at 895 million złoty a half-year against silver at 5 843 million is a tenth of the credit; lead and molybdenum are smaller still.
    KGHM Polska Miedz S.A. Group condensed consolidated financial statements for the first half of 2026 (the note stating that revenues from no single contractor exceeded 10% of group sales, the geographical breakdown by end-customer location totalling 21 927m złoty with Poland at 4 845m and Germany at 2 815m, parent revenue of 14 430m from copper and 5 843m from silver, the amending act on the minerals extraction tax in force from 1 January 2026, the group structure and equity accounting of Sierra Gorda, and derivative counterparty concentration) — H1 2026 · publ. August 2026 · source ↗
  6. ReportedKGHM's new strategy leans on this tier, proposing to extend the portfolio toward nickel, cobalt, platinum-group metals and eventually lithium and rare earths.
    KGHM Polska Miedz S.A. Group - Management Board's report on activities in the first half of 2026, the Strategy of the KGHM Group 2055+ approved on 3 July 2026 and its targets (payable copper production above 730 thousand tonnes a year of which about 590 thousand from Polish assets including 180 thousand from scrap, adjusted EBITDA averaging 12 billion złoty at a 25,6% margin, capital expenditure above 32 billion złoty across 2026-2030, at least 220 MW of installed renewable capacity, the Sierra Gorda fourth grinding line at 725 million dollars raising output about 20% while shortening the life of mine by three years, the Deep Glogow Deposit Access Program, and shareholders including the State Treasury at 31,79%) — 2026-2030 and beyond · publ. August 2026 · source ↗
Sources
Generated September 24, 2026