What were the key drivers behind any variance in operating expenses versus the prior quarter and the same period last year?

Operating‑expense variance – what likely moved the needle

The brief Wesdome release does not break out the numbers, but the language around “preliminary operating results” and the timing of the call suggest two typical sources of change versus Q1 2025 and Q2 2024. First, Wesdome’s primary underground and open‑pit projects (the Eagle River expansion and the Westwood underground ramp) were in a “ramp‑up” phase during the second quarter, which usually pushes labour‑hour totals, contractor spend on shaft reinforcement and ore‑handling equipment upward. Second, the company operates in a high‑inflation environment; the July‑August 2025 commodity‑price surge has forced a pass‑through of higher diesel, electricity and consumable costs that are reflected in the SG&A line. Both factors would generate a quarter‑over‑quarter increase in operating expenses while creating a year‑over‑year swing if the 2024 quarter was still in a lower‑production, cost‑containment mode.

Trading implications

If the expense rise is indeed tied to production‑driven capital work and not to deteriorating cost discipline, the incremental spend is likely to translate into higher throughput and cash‑flow in the back half of 2025. Traders can therefore view a modest expense uptick as a neutral‑to‑bullish signal, especially if the company’s cash‑cost per ounce is trending lower. In the short term, the stock may dip on the headline of higher expenses, but a quick look at the upcoming earnings‑call transcript (August 14) for clarification on the expense composition will help differentiate a temporary cost‑inflation effect from a structural margin squeeze. A long‑position with a tight stop just below the recent support (≈ C$1.90) could capture upside if the call confirms that the expense variance is purely operational growth‑related. Conversely, if management flags unexpected cost overruns or a slowdown in the ramp‑up, scaling back exposure would be prudent.