Executive Summary / Key Takeaways

• Seabridge Gold Inc. (NYSE:SA) is a specialized gold exploration and development company, primarily focused on its flagship KSM (Kerr-Sulphurets-Mitchell) project in British Columbia, which is recognized as one of the world's largest undeveloped gold and copper projects by resources.
• Despite currently generating no revenue from mining operations, Seabridge Gold's investment thesis is underpinned by the significant leverage its vast resource base offers to rising gold and copper prices, with analysts forecasting gold to reach $3,675/oz by Q4 2025 and potentially $4,000/oz by mid-2026.
• The KSM project achieved a critical "Substantially Started" (SS) Designation in July 2024, securing its environmental approvals, though this designation and the project's Mitchell Treaty Tunnels (MTT) rights are currently facing legal challenges.
• Seabridge Gold operates with a unique strategy of acquiring and developing large-scale deposits to expand its resource base, aiming to partner or sell projects at the production stage to limit risk and share dilution.
• The company's financial performance reflects its exploration stage, with reported net losses and reliance on financing activities, but its substantial asset base and strategic project advancements are key indicators for investors.

A Vision Forged in Gold: Seabridge's Strategic Foundation

Seabridge Gold Inc., incorporated in 1979 and rebranded in 2002 to reflect its dedicated focus, stands as a unique entity in the North American mining landscape. The company's core business revolves around the acquisition and exploration of gold properties, extending its efforts to include copper, silver, and molybdenum deposits. Unlike traditional mining companies that focus on active production, Seabridge's overarching strategy is to identify, acquire, explore, and develop large-scale gold and copper projects, aiming to significantly expand its resource base. The ultimate goal is to partner with or sell these projects once they are ready for production, thereby limiting the technical and financial risks associated with mine construction and operation, and optimizing gold resources while limiting share dilution.

At the heart of Seabridge's investment narrative is its flagship KSM (Kerr-Sulphurets-Mitchell) project in British Columbia's "Golden Triangle." This project is not merely another deposit; it is recognized as one of the world's largest undeveloped gold and copper projects by resources. An updated Preliminary Feasibility Study (PFS) estimates proven and probable reserves totaling 47.3 million ounces of gold and 7.3 billion pounds of copper, alongside 160 million ounces of silver, over a projected 33-year open-pit mine life. The 2022 PFS projects an after-tax net present value (at 5%) of US$7.9 billion and a life-of-mine total cost of US$601 per ounce of gold produced after base metal credits. This immense potential positions KSM as a long-term value driver, particularly with the backdrop of rising metal prices.

The broader industry context further amplifies Seabridge's strategic positioning. Gold prices have experienced a significant surge in 2025, with spot gold climbing to $3,653 per ounce as of September 10, 2025, marking a 39% increase for the year. This rally is fueled by expectations of U.S. Federal Reserve interest rate cuts, a weakening U.S. dollar, and sustained central bank purchases, coupled with ongoing global economic uncertainty. Analysts from JPMorgan (JPM), Goldman Sachs (GS), and UBS (UBS) project gold prices to average around $3,675/oz by Q4 2025 and potentially reach $4,000/oz by mid-2026, with some forecasts even suggesting a climb as high as $5,000 if private investors significantly shift assets into the metal. This bullish outlook for gold, combined with future demand for copper, directly enhances the profitability and long-term value proposition of Seabridge's KSM project.

The Edge of Expertise: Seabridge's Differentiated Approach

Seabridge Gold's competitive advantage is not rooted in a singular, patented material science breakthrough, but rather in its specialized operational and project execution expertise. The company's "technological differentiator" lies in its proprietary project expertise in complex polymetallic deposits and its agility in exploration and development of early-stage, high-potential projects across North America. This specialized know-how allows Seabridge to effectively evaluate, acquire, explore, and develop gold deposits, a strategy it has honed since its inception.

This expertise translates into tangible benefits for investors. By focusing on expanding resources and upgrading them to reserves, Seabridge aims for enhanced resource discovery, which can lead to superior growth in its asset base. The company's approach to identifying and developing large-scale gold and copper projects, such as KSM, is designed to create substantial value by increasing the resource base. This strategic focus on resource expansion, rather than immediate production, allows for better capital efficiency in the exploration phases, as the company seeks to maximize gold ownership per share while limiting dilution. While specific quantifiable metrics for the "efficiency" of this expertise are not publicly detailed, the strategic intent is to unlock significant value from complex deposits that might be overlooked or less efficiently developed by others. The company's R&D initiatives are implicitly tied to continuous geological and engineering studies aimed at optimizing project designs and resource estimates, as evidenced by the updated KSM Preliminary Feasibility Study.

Financial Footprint of an Exploration Giant

Seabridge Gold's financial statements reflect its identity as a development-stage company, rather than a revenue-generating producer. For the fiscal year 2024, the company reported total revenue of $0, a consistent trend as it focuses on exploration and development activities rather than active mining operations. This absence of traditional revenue means that profitability metrics such as gross profit, operating profit, and net profit margins are not applicable in the conventional sense.

The company reported a net loss of $31.25 million ($0.35 per share) for 2024, a slight increase from the $29.27 million loss in 2023. This is primarily driven by significant exploration expenditures, which are crucial for discovering and developing economically viable gold deposits. Operating cash flow was negative, standing at -$14.22 million in 2024, and free cash flow was -$120.50 million, indicating substantial investment in project development.

To fund these capital-intensive projects, Seabridge relies heavily on financing activities, including the issuance of shares and debt. For instance, in 2024, the company issued $101.02 million in capital stock. As of December 31, 2024, Seabridge Gold had a cash position of $49.81 million, down from $82.44 million in 2023.

Total assets, however, have steadily grown, reaching $1.45 billion in 2024, up from $1.35 billion in 2023, largely due to investments in mineral properties and construction in progress. The company's debt-to-equity ratio was 0.57 as of the latest TTM data, reflecting its reliance on debt financing for project advancement.

Navigating the Competitive Currents

Seabridge Gold operates within an intensely competitive gold mining sector, vying for capital, resources, and project development opportunities against both major gold producers and smaller exploration companies. Its primary competitors include industry giants like Barrick Gold Corporation (GOLD), Newmont Corporation (NEM), Kinross Gold Corporation (KGC), and Agnico Eagle Mines Limited (AEM).

Seabridge's market positioning is that of a specialized explorer, focusing on identifying and developing large-scale gold deposits rather than immediate production. This contrasts sharply with the strategies of its larger peers. Barrick Gold, for example, is a global powerhouse with a broad operational footprint, characterized by steady revenue growth, strong profitability margins, and robust cash flow generation. Newmont, another leading producer, emphasizes sustainable mining and portfolio optimization, demonstrating reliable revenue and healthy margins. Kinross Gold focuses on cost discipline and high-margin projects, while Agnico Eagle Mines is known for consistent revenue growth and solid profitability from reliable operations.

While Seabridge excels in strategic adaptability and project innovation, particularly in identifying new reserves, it lags its larger competitors in financial performance metrics such as profitability and cash flow due to its exploration-stage nature. For instance, Seabridge reported a TTM net income of -$45.44 million, with 0% gross, operating, and net profit margins, reflecting its non-revenue generating status. In contrast, Newmont reported a net income of $3.4 billion in 2024, with a 30.5% net income margin and 20.3% return on equity in Q2 2025. Kinross Gold also demonstrated strong financial resilience, with an EBIT margin of 39.5% and a profit margin of 25.54% in recent earnings reports, alongside robust revenue of over $3.72 billion. Agnico Eagle Mines reported TTM revenue of $9.664 billion as of June 30, 2025, with earnings growing at an average annual rate of 29.6% over the past five years.

Seabridge's unique value proposition lies in its focus on high-potential, underexplored sites, which could provide significant upside in resource discovery. However, its smaller scale and higher exploration risks make it more vulnerable to market fluctuations and capital-intensive development cycles compared to the established infrastructure and diversified revenue streams of its larger rivals.

Outlook and the Road Ahead

The outlook for Seabridge Gold is intrinsically linked to the continued strength in gold and copper prices and the successful advancement of its KSM project. Analysts are bullish on gold, with projections for prices to average $3,675/oz by Q4 2025 and climb towards $4,000/oz by Q2 2026. Some forecasts even suggest a potential for gold to reach $5,000/oz if private investor demand intensifies. This sustained bullish environment for precious metals is a significant tailwind for Seabridge, as higher metal prices directly enhance the potential profitability and valuation of its vast in-ground resources.

A critical milestone for the KSM project was achieved on July 29, 2024, when it received a "Substantially Started" (SS) Designation from the Environmental Assessment Office (EAO) of British Columbia. This designation ensures that the project's Environmental Assessment Certificate is no longer subject to expiry, a crucial step towards de-risking the project's long-term viability. Seabridge had secured US$375 million in funding to undertake early site construction activities to achieve this designation.

However, the path forward is not without challenges. The KSM project is currently facing legal hurdles. Tudor Gold Corp. (TDRRF) filed a Notice of Appeal in the British Columbia Supreme Court on July 14, 2025, challenging Seabridge's prioritized rights to use land for the KSM Project's Mitchell Treaty Tunnels (MTT). Additionally, petitions have been filed in the BC Supreme Court challenging the EAO's decision to grant the SS Designation itself. Seabridge Gold and the B.C. Government have filed responses to these petitions, defending the designation. The resolution of these legal challenges will be vital for the uninterrupted advancement of KSM.

Despite these legal complexities, management remains optimistic, emphasizing their commitment to enhancing shareholder value through strategic exploration and development. The company aims to leverage its strong asset base and industry expertise to capitalize on opportunities in the gold market.

Risks and Considerations

Investing in Seabridge Gold carries inherent risks typical of an exploration and development company. The primary risks include project development risks, such as potential cost overruns, construction delays, and technical challenges associated with large-scale, capital-intensive projects like KSM. Financing risks are also significant, as the company relies on debt or equity financing to fund its operations, and the availability and cost of capital can fluctuate with market conditions. The current environment of high borrowing costs could further impact project timelines and expenses.

Legal and regulatory challenges, as seen with the ongoing petitions against KSM's "Substantially Started" designation and the appeal by Tudor Gold, pose a material risk. Adverse rulings could significantly delay project development and increase costs. Furthermore, the gold mining sector is intensely competitive, with Seabridge facing competition for capital, resources, and development opportunities. While the company's strategy is designed to mitigate some risks by partnering or selling projects at the production stage, it remains exposed to commodity price volatility and the inherent uncertainties of exploration success.

Conclusion

Seabridge Gold Inc. presents a compelling, albeit speculative, investment thesis centered on its world-class KSM project and the robust bullish trend in gold and copper prices. The company's unique strategy of acquiring and developing vast polymetallic resources, coupled with its specialized exploration expertise, positions it to offer significant leverage to rising metal values without undertaking the full operational risks of mine production. The "Substantially Started" designation for KSM marks a pivotal achievement, securing its environmental approvals and de-risking a major aspect of its long-term development.

While Seabridge's financial profile, characterized by negative earnings and cash flows, reflects its exploration-stage nature and contrasts with the robust profitability of its larger, producing peers, this is a function of its strategic focus on future value creation. The ongoing legal challenges surrounding KSM's land rights and environmental designation introduce uncertainty, yet the underlying asset quality and the strong macroeconomic tailwinds for gold and copper suggest a powerful long-term opportunity. For discerning investors with a high tolerance for risk and a long-term horizon, Seabridge Gold offers a unique pathway to participate in the potential upside of a golden era, contingent on successful project advancement and favorable resolution of current legal hurdles.