Good afternoon, ladies and gentlemen. Welcome to the annual general meeting of Kingsgate Consolidated. I'm told that the time has arrived, and the company secretary has advised me that we have the necessary quotas, so I declare the Kingsgate annual general meeting open. My name is, you probably don't need reminding, is Ross Smyth-Kirk. I'm the Chairman of Kingsgate Consolidated, and I'll be chairing today's meeting. We appreciate your participation today, both in person and—not yet—and virtually via the MUFG platform. Before I start, I'd like to remind you that the site that you're on today is the site of the first government house in Australia and the importance that it was to the original settlement here in Sydney and therefore to the establishment of the great country of Australia.
If we experience any technical issues today, a short recess or an adjournment may be required depending on the number of shareholders being affected. I'm not sure what that's supposed to mean, but anyway, if this occurs, I shall advise you accordingly. I'd like to introduce you to my fellow directors seated at the table. There's Jamie Gibson, if you're on my right, our Managing Director and CEO.
Good afternoon.
Director Peter Warren on the far end.
Well done.
Chair of the Audit, Remuneration and Nomination Committees, and in between our General Counsel and Company Secretary, Stephanie Wen. In attendance from Kingsgate leadership team is also Mischa Mutavdzic—I knew I'd do it wrong, Mischa. Sorry, Mischa.
That's okay.
You can get me later. Our Chief Financial Officer, Jill Terry, who's down the front here, General Manager Geology, Bronwyn Parry over there, General Manager Corporate and External Relations, Byron Gordon, Byron up there, Head of Corporate Development and Strategy, and Cherdsak Utha-aroon , General Manager Sustainability for Chatree Mine. Cherdsak has a number of the beautiful young ladies from up in Thailand, from our mine, who are, yeah, stand-up ladies. They've come especially for our AGM today. Some of our very senior female executives up there, and we do have quite a lot of very good female executives through the team, haven't we, Cherdsak? It's very, very, very, very good. Also in attendance are representatives from the company's auditors, PwC, Craig Thomason, and Frank Lee. Frank. And our company share register, MUFG. He didn't put your name here, Richard. Oh, sorry, mate. No. Aaron.
For those present who haven't registered, please go to the company share register. That's the MUFG table located at the entrance to the auditorium. Now to register and obtain a voting card if you intend to—if you're entitled to vote today. Now, this is also being held as a virtual meeting, and for shareholders joining the meeting virtually, details on how to join the meeting virtually are set out in the notice of meeting and the online meeting guide that are available on the company website. Virtual attendees can participate in a live webcast of the meeting and ask questions and submit votes at the appropriate time. If you experience any technical issues during the meeting, call the help number displayed at the top of the screen. To vote during the meeting, please click on "Get a Voting Card," displayed at the top of the screen.
If you haven't done so yet, you can follow the instructions displayed on your screen to register to vote. In relation to proxies, the company has received valid proxy votes from shareholders, and as required by the Corporations Act, I will provide the details of the proxy votes immediately preceding each resolution. Now, the format of the meeting: voting for all resolutions will be conducted by a poll. I'll run through the poll procedure after the resolutions have been read, and the results from today's meeting will be released to the ASX and also made available on the company's website as soon as practicable after the meeting. As noted in the notice of meeting, I intend to vote in favor of the relevant resolutions for all discretionary proxy votes held by myself as Chairman of the meeting.
The proxy votes have been independently collated and confirmed by MUFG and have been reviewed by the company. I remind you that only those holding a yellow or a blue card may ask a question or make a comment. When I call for questions, if you wish to ask a question, please go to the standing microphone located at the front of the room over there. State your name, and if you're a proxy, state who you represent, and then ask your question. If you have difficulty getting to the standing microphone, please raise your hand, and an attendant with a microphone—I think Corinne's got it here—will come and assist you. Please mention your name, state whether you're a shareholder or a proxy, and if you're a proxy, please state who you represent, and then ask your questions. There's a little here on how virtual shareholders can ask questions.
For those attending virtually, we wish to ask a question. Please do so by using the "Ask a Question" button on your screen, which will open a new window where you can type your question. While you can submit questions at any time, I'll address them during the relevant time of this meeting. I intend to answer questions from the floor first before answering the online questions. To allow others to ask questions and due to time constraint, please limit your questions to two questions at a time. Questions of similar nature will be combined. Any unanswered questions may be addressed at a later date via email as we see appropriate, so don't ask too hard questions. Please direct all questions to me as Chairman of the meeting. Attendees who are visitors holding a red card do not have a right to ask questions or make comments.
I'll now give my Chairman's address. We have today announced the cessation of the TAFTA International Tribunal case that the company had initiated against the Kingdom of Thailand by mutual agreement, and you probably have seen the release to the market. This is a significant milestone for the company and heralds a renewed amicable relationship of cooperation between the company and the Kingdom of Thailand, which should be beneficial not only to the company but the Thai government, the people of Thailand, and the local communities surrounding the mine. The history of the TAFTA arbitration case has been long and much discussed in many releases from the company. From very early days of negotiating between the parties, as we were encouraged to do by the tribunal, it became very clear that the Thai government was not prepared to pay any monetary compensation.
As a result of various efforts, including by Akara in Thailand, we were able to resume mining activities. More recently, for the benefit of the company, the board has decided it is most prudent to end the arbitration. It became clear to us that what had previously been a positive for the company had lately developed into a more complex territory in recent times, particularly in dealing with other Thai companies and other government instrumentalities. We believe this decision should herald in a new era of cooperation and benefit your company and all stakeholders. Now, as previously reported, production at the mine continues to progress, with the September quarter being the best quarter since we recommenced mining. This current quarter will be lower than the previous one due to predicted lower-grade ore being mined, but it is expected that this will improve in the new year.
Significantly, since resuming production in March 2023, predominantly for some time from our low-growth stockpiles, we have produced over 150,000 oz of gold and nearly one and a half million oz of silver. The performance of both gold and silver over recent months has continued unabated in one of the strongest upward movements in living memory. Whilst predicting prices is particularly perilous, the performance so far does not seem to indicate any change in direction in the foreseeable future. We, of course, certainly hope that that is so. One of the most significant aspects of the year under review was the successful exploration results from what is now referred to as the South-East Complex. For many years, when we did not have access to much of our exploration areas, we claimed that we had previously done enough work on various areas to say that we had eight to ten drill-ready targets.
This indicated that we believed we had done sufficient work to indicate a high probability of uncovering new deposits. This referred to both extensions of the Chatree Complex and completely unrelated potential deposits. The South-East Complex itself, its exploration results certainly vindicate our expectations, and we have already announced resources of around 500,000 oz of gold from only limited drilling. There is little doubt that this will grow over time and is definitely part of the Chatree Complex, with some of the deposit closer to the plant than the current area we are mining to the North. This clearly shows the real upside to the areas held by your company, and considering that we have nine to ten years of production expected from the current mining leases confirms the strong upward potential for your company.
Further information on the current status of aspects of your company will be supplied later in this meeting, and credit must go to our loyal employees in Thailand, some of whom have come down from Thailand to address this meeting on some of their activities. Again, welcome. I wish to thank my fellow directors for their support and perseverance through many difficult periods, much of which does not see the light of day. A special thank you to our small but close-knit head office staff who maintain their great support through thick and thin. Thank you very much. Now, we will now listen to a presentation delivered by Jamie Gibson, our Managing Director and CEO. Over to you, Jamie.
Thanks very much, Ross. I am delighted to be here giving this presentation on such a momentous day for Kingsgate. What a ten years it's been, and I'm really happy to tell our story, put the ten years behind us, and to look forward to celebrate the fantastic opportunity and ten years in front of us. I've just got to find the clicker, wherever that's gone. If I got that, this is it. Oh, it's on the table. Sorry. I'm just going to walk around a bit, if that's all right, because I'm going blind with all the stress of working at Kingsgate, so I find it easier to see the board. No, it's gone missing. We'll find it later. Thank you. Thank you. Sorry about that. Right, let's get on with it. Please take note of the forward-looking statements because I will be making a few.
I want to welcome potentially new shareholders here today. I see a lot of faces in the crowd, older shareholders, and we're so grateful for your support and that you've stayed with us through the journey. If you're a bit newer to us, you may have seen me do this once or twice, but I really love talking about the company because I think it's got such an enormous upside potential. I want to start on the left-hand side with our key metrics. Billion-dollar company. When all of this kicked off and all our troubles started, we were a AUD 40 million litigation company. Today, we are a AUD 1 billion gold company with enormous upside. Share price around the AUD 4 mark. Incredible. Shares on issue around 257 million.
Now, I want you to remember that because I'll be talking a little bit about it later and why it's important to us. We've actually been making it a little bit smaller this year, and we've had a really strong year on the cash build as well. We were up to AUD 115 million at the end of the September quarter, which is fantastic. I think that was 36% growth just in the last quarter alone in terms of cash generation, which is incredible. Borrowings, we've got it under AUD 50 million. We'll be looking to chunk that off quickly as we can, and obviously, we're building to a very strong deleveraged future as we go. Share register there. What's been really pleasing as well, and can I tell you an interesting fact?
In 2016, when we first hit our major speed bump, our share register went from 60% institutional down to 16% institutional, and it was largely there for the best part of the last nine years. Again, some very large retail holders that were supportive and stayed with us, really grateful for that. What we found even in the last six months, share register now is probably getting closer to 30% institutional, which is great. Had a lot of large shareholders' funds out of Europe, particularly Switzerland and Germany, that know our story, know the name, came on, and we've actually had some ETFs out of the U.S. come in as well. That has been really pleasing. Some big names in the resource sector, also a shot in the arm for marketing and morale.
I want to give a special shout-out, and the two guys are here, Duncan and Reg from Canaccord, and I do all the time. The reason I say this is when we were in the wilderness for a few years, you couldn't get coverage, you couldn't get brokers to look at you, you couldn't get anyone to tell you a story other than you. Of course, as you know, I love talking, but I can't be everywhere. These guys came in the pool first, and they've got an incredible price target on us. I think AUD 7.70 as of recently, which is incredible. We've got a little way to go, but really grateful for the support, and thanks for coming today. Molars too, and thanks to them, they picked us up.
I think they're a little bit more modest, maybe just under AUD 6, but it's good to be back getting noticed and getting some coverage so that you can independently verify our story, and you can see how far we've come and hopefully how much upside we've got. Under that, I love this graph. You don't see too many graphs like that. When we first started, I had a lot of graphs going the other way, but this one is fantastic. Twelve-month share price performance is better than 200%. We're in front of the ASX 200. We're in front of our peers by comparison. It's just a really good graph, and we think that there's going to be a lot more to come for that. They're the key metrics. That's what Kingsgate looks like today.
Of course, two key assets, the Chatree Gold Mine in Thailand, which I'll be talking about, and the highly prospective Nueva Esperanza project in the Maricunga Belt of the Atacama Region of Chile. Let's start with Chatree. Okay, this is our main asset. You know where it is? Central Thailand, 280 km North of Bangkok, and it straddles the Phichit and Phetchabun provinces. It's a large, low-grade, open-pit epithermal system. We've got exactly 1.22 million oz of gold in reserve. That's about a nine-year mine life going at about 100,000 oz a year. We're there for a long time. That's without doing anything else. Prior to 2016, we knew it was good. Close to 2 million oz of gold out of it, 10 million oz of silver, which is fantastic. Last production year, just on 75,000 z of gold, 625,000 oz of silver.
That is as we are ramping up. We are coming back to life, modest year. We are getting better. I will talk a little bit more about that. Some of the things that have made our life significantly easier are some of the concessions that we have got from Thailand. Obviously, we have got a AUD 100 million tax holiday. That is about eight years. That is combined with some tax losses carrying forward. We hope for the better part of the next decade, just looking at Mischa. He says this is all right. We should be about tax-free for about 10 years, hopefully a little bit more if our accountants say we can, which would be great. The other really important one, whenever we repatriate money, obviously all the cash comes into Chatree itself. When we dividend it or pay it down to Kingsgate, we get an exemption on the withholding tax.
Actually got Adam, who's with us here today, doing a special bit of work on FX so we can minimize the FX fluctuations when we do that as well. We are looking at how we do that. We have got tax exemptions on some of the equipment, some of our Caterpillar equipment. We bought 41 pieces last year. Very exciting. We have been having great fun with that in the pit. We like it so much. We are buying another piece. We have got another 60/30. That is the real big digger. We hope to get that early next year. That will help us catch up on some of the waste. If you looked at our September quarter, you would have realized our stripping ratio is going up a little.
We've got a little bit of waste to catch up with on the Western side of the pit, but this is part of one of the strategies to do that. The processing plant. I love our processing guys. In fact, our General Manager up there, Bob Kennedy, he's like a modern-day apothecary. He's a processing guy. That's his background. There's nowhere he hasn't processed. We've got him to thank for getting the plant to run as well as it has. As you know, the nameplate capacity is 5 million tons. It's currently running around 5.8 million, 16% above nameplate. Those guys have got great designs to get it above that. Obviously, if that happens, we get better throughput, we get better ounces, we get better recoveries, all of those sorts of things. That is fantastic. Of course, one of our most proud things is our really highly educated local workforce.
Here's some of them here. [Khun Koong], who's, and maybe just wave, [Khun Koong]. [Khun Koong] looks after our community relations. We'll talk a little bit more about that when Khun Cherdsak talks, but she's from Phichit. She's from the local area. She's a generational Phichit person. Her family works in the area. They have businesses that support the mine. She's been fantastic. [Khun Gik], if you could give him a quick wave. She's the same. When you drive into the mine, [Khun Gik]'s got a really beautiful house on the left-hand side, and I always look to see what she's got in a garden because it gives me ideas for tropical plants back here in Australia. She's fantastic. Her lovely husband runs our IT system up at the mine as well, [Khun Montree], really capable technical guy.
In fact, our IT providers are outsourced here, so I can say I think he's better than them, but they're lovely. Again, they're part of the fabric of the community. That's why we love it so much. That's Chatree. That's what it is. What's our year been like? Yes, I'm the first to say modest year, 75,000 oz ramping up, but we're showing through successive quarters, and we've had three now where we've gone over 20,000 oz. In fact, 24,000 oz in the September quarter was fantastic. Shows that we could do it. 200,000 oz of silver as well as a byproduct credit. What a great thing that was. You can see our all-in costs are coming down, AUD 1,166 in the last September quarter. Now, that's pre-royalties. Why do we do it like that?
Yes, the one little bad thing is that Thailand does have high royalties. We are working on that. It is a sliding scale with the gold price, but if you look at where we are pre-royalties, we're easily on par with some of the best producers here in Australia, and that's where we want to be. Actually, you can see, and I think I said it before, the productivity on the back of that gave us a 36% cash boost in that last quarter. We've gone out again. Next year, we want to get between 85,000 and 95,000 oz of gold. That's 93,000-103,000 on a gold-equivalent basis. A little bit modest. Yes, I get that. I want you to remember, we've only really been mining for 12 months. We've only had the Caterpillar stuff in the pit since September.
We haven't had any major operational issues. Small ramp slip yet, but we've got over that. Had a few other little teething issues. Ramping up, reopening a mine that hasn't been mined for eight years is hard. Obviously, we're in a tropical environment as well, but we've been working on that solidly, and we just want to do what we say. If we say we're going to get that, we want to get that so we can get some operational credibility. That's where we are. Right, this one. This is our organic growth plan. You know I see this slide, and I see [Keith Goode] in the audience, and I feel bad because I know he loves the geology, and I was reading the other day where he's at Evolution, and they did this fantastic AGM, and there's all this geology stuff and everything else.
We're kind of in between seasons, right? We drill the dry season. We don't drill the wet season so much. You get water in the core. It changes the assay results, so we're kind of swapping over. I think you've heard me say this. We're in the Loei Fold Belt. You can see it there. You can see where Chatree is, the gold spot in the middle of that belt. That belt's a massive belt, considered to be one of the biggest and the best in mainland SouthEast Asia. We're right in the middle of it. There's really no one with us. We've got all the best bits pegged. It's pretty exciting. We've got 1,200 sq km of exploration potential. A lot of it's within trucking distance, less than 20 km of the mine.
As you can see there, and we've just got a little schematic, the South-East Complex on the top right. We've kind of zoomed in a little bit. The yellow bit's the actual Chatree mining complex itself, and you can actually see how close it is, right? We've talked about this this year. This thing's unreal. We've drilled about a third of it, posted 550,000 ounce z resource on the back of it. A lot more to do there. Actually, you can see it. The D pit itself, which is one of the first pits that we mined at Chatree, is actually bleeding mineralisation into the T prospect at the top of the South-East Complex. It's divided into six zones. You can see there in the map. There'll be a lot more about that. That is the future of Chatree. That's only one bit that we've got in.
We're limited by the amount of resources we can put into it, geological resources. The other side of Chatree is Pichit. We're going to do some work there in 2026 as well. We know there's some really strong drill-ready targets because we've been there a long time. We'll be out the other side. That is a continuation of the system too that we think. We'll be concentrating on that hard. That's been amazing, South-East Complex. We think tip of the iceberg, huge future to work towards. That's part of our strong organic growth platform for Thailand. Really excited. Happy to take some more detailed questions on the geology as we go forward. That's where we are. We've got all the best bits. We've got some unbelievable prospects around Chatree itself.
Okay, just a quick one because Khun Cherdsak's going to talk about this. Obviously, with no social license to operate, there's no mine. Our community and our community engagement is our proudest thing. The people are just fantastic. I actually didn't mention [Khun Tan], who's here, who's fantastic. She runs our community and PR and government relations as well, based in Bangkok, but works closely with the team and does all of these beautiful promotional things. You see it. I don't know if anyone follows the Akara Facebook page, but it is fantastic, and it's a great way to stay up to date with what's happening up at the mine. A big thanks to you as well, [Khun Tan], for all your excellent work on this. The guys will tell you some more about it.
They've got some community engagement, some testing and monitoring stuff that they do. Khun Cherdsak will tell you about that in a minute, but I just wanted to touch on it. So important. Without this, there is no mine. Right, jumping across the Pacific, Nueva Esperanza Development Project. And look, I put my hand up. I'm the first to say this hasn't gone as quickly as we wanted it to. One reason is that we were fully focused on getting Chatree back up and running as fast and as hard as we could once we came back to life. Still an incredible silver project in the current market. As you know, we got it pre-feasibility stage in 2016. You know it's in the Maricunga Gold Silver Belt, and there's some elephants around us. Gold Fields has got Solaris Norte not far away from us.
I was looking at them the other day. They've got a 4.1 million ounce gold-equivalent reserve. That thing's going to produce something like 500,000 oz a year. Ours is similar to that, they tell me. So we're in really good area. Now, what we have been doing, obviously, we had it parked up for 10 years. We picked up the data. It's taken us a little while to reconcile it, get it back into shape, but we've got the layer cake of works going. We're doing the fixed-wing topographic survey, geochemical rock work. We're identifying some new targets. We're also working on making sure the water bores are in good stead. We've got new environmental consultants to make sure all the permits and leases are in good order. We're revisiting the feasibility assumptions in 2026. And we're also with silver at AUD 53 an ounce.
I think the fundamentals for it are still strong. One of the things I look at a lot, and there's a lot the analysts will tell you, silver's been in backwardation for the best part of this year. What that means really simply is the futures price is actually lower than the current spot price. That shows you how much demand there is. AUD 53 U.S. silver. Don't forget, we've got maybe 500,000 oz- 1,000,000 oz of silver at Chatree coming out as well every year. That's like a AUD 50 million bonus to have that. We get the byproduct credits. We think this could be incredible. With the resource of 60 million oz of silver, we still think that's one of the world's largest underdeveloped silver projects. We make no secret of it, though, because we have been working on Chatree.
We've been looking to how do we best optimize this? How can we bring it on faster? Is that a joint venture? Is that a sale? Is that us doing something with it? Stay tuned. I know I say that a lot, but you will see some tangible movement on that. We've actually got Byron, who's with us, who's been doing a lot of work to move that forward behind the scenes. We just had to get it in order. It needed a bit of a tidy up. We've tidied it up. We're moving it forward. Silver fundamentals remain strong. Should be fantastic still. Stay tuned for that one. That brings me to the highlights for the year.
I always love this because gee, we've had a few years here where we haven't had too many highlights, had a few lowlights and a few things like that. This has been fantastic. Start with the first one, safety, right? Never talked about enough at mining. We had a total, TRIFR, they call it, but it's total recordable injury frequency rate, right? It's always tricky, always get it wrong. Happy I got it right. Ours is 2.75. It's a bit higher than where we want it to be, but we take it seriously. We've actually got a specialist safety guy heading up to Chatree first week of December. He's going to do a full review, make sure we're on top of all those things. Next one, share price. I've already said that. + 200%, unbelievable. Hopefully, some of you have taken some money off the table.
We think there's a few dollars yet to run, and we'll be doing our best to do that. This other big one, this was a really great addition to get back into the ASX 300. We used to be, we used to be in the 200. We're aspirational to get back there. That was a really welcome addition. That had a big effect on us too in terms of visibility, purchasing, people coming onto the register really helped. You saw our production, record production in September, record AISC margin. We're making lots of cash, literally a gold mine in a bull market, fantastic. Over the year, 260% approximately increase in cash and bullion, which was great. We're paying down debt, AUD 8 million over the year. We'll focus on that in 2026, especially if we want to deleverage ourself. Started a buyback program.
Now, you're voting for this again today. As I say, this board is very focused on tight capital structure and return to shareholders. Started that in May. Then the share price started to run and we couldn't afford it anymore. Having said that, we keep it under constant review. If we think there's a strategic time to get back in, we'll get back in and do it. Keep an eye on that. Obviously, you've spoken about South-East Complex, why that's so good, 500,000 oz there, robust exploration program. The thing I didn't say when I was on the exploration slide is some of the grades coming out of South-East Complex are as good as the early years of Chatree.
Now, some of you would remember in the early pits C and D, there were super-gene halos, which means really high grade near the surface, five or six grams a time, which is amazing for us. I think there could be possibility, something like that, where we're going as well. They're incredible intersections. I just want to underscore the relationship with the government because there'll be a lot of speculation. Are you friends? Are you not? What's going on? We're friends. We're winning prizes. There's a really good engagement. Our colleagues here, talk to them all the time. In fact, [Khun Gik], I think's got the DPIM Region 5 Phichit on speed dial. Our relationship is very, very strong. That's important for us because it's permitting and all of those sorts of things. We've had a really, really good year.
This time last year, I think we were trading around AUD 1.40, AUD 4, AUD 4, all these other things, enormous upside to go. It has been a really good year. The first time I'd be really happy to stand up here in front of the shareholders, I can tell you. Right, what's our value proposition? If you're new to us, you bought us, want you to stay with us, and here's why. It is a long way to go on the production uplift, right? We're just getting started. We're just getting all the teething issues out. You can see that we can do it. We're up over 20,000 oz. We're getting better AISC margin. We've got new Caterpillar equipment. The plant's running well. You can always do it better. It is not to say that we won't have a few teething issues. Mining is hard, but we will work on it.
There is a long way to go on the production side. We think that is one of our key value drivers. The other thing is our financial strength. Really delighted to have Mischa on board. He is really big on this. He is about strengthening the balance sheet, repay the debt, deleverage. In this gold market, we remain unhedged as well. Does not say we do not look at it. We think about the puts. We look at it. We look at whether we should hedge at some point. We keep it under constant review. At the moment, we are fully exposed, and we are enjoying the upside exposure to that. As I say, small capital structure, 256 million shares out there. Makes it better if we buy back some more. If we give you a dividend, it is small, so it will be meaningful. That is what we want. It is certainly tight by peer comparison.
If you look at anyone else like us on the ASX, three, four, five, six times the amount of shares on issue. We are really proud of that. We have kept it tight even through all of the years when we did not have any money. Of course, organic growth platform, huge. As you saw, South-East Complex is just one. We have so much area because we are the first and only mover in that region with actually the biggest Australian company in Thailand. That comes with a lot of benefits. As you can see, we have nine-year reserve life, all of that sort of stuff, and we are finally knocking Nueva Esperanza into shape. There is a lot to look forward to. On that note, I would like to just note the mineral resources, that is just for compliance reasons.
On that note, I'd just like to finish by saying at AUD 4 roughly, with a couple of price targets and some opportunities coming, I think we're a cracking buy. I would urge you to stay with us, and we really appreciate the support that we've had for over the years. Now I want to hand over to Khun Cherdsak. He's our General Manager of Sustainability, and he's going to tell you and show you some great examples about why the community and what the work that the team up there does is so important and why it's so important to our future and our longevity. Thank you very much.
Thank you, Jamie. It's a true privilege that I'm here with Kingsgate Board and the shareholders and have the opportunity to share with you some of the good work we have done around the mine site.
You know from Jamie's presentation already of the area where we are operating, we are, let's say, right in the middle of the country. It is in the Phichit Phetchabun Gold Belt, and it's about 200 km directly North of Bangkok. Let's go deeper into the area. We call this area Chatree Communities, and you can see the yellow polygonal figure in the middle. That's our operation area, having mining leases, metallurgical licenses, waste dumps, and several other permits. The red dotted line around that shape is the 1 km radius, and then three, five, and ten. Within the 1 km radius, there are 28 villages and about 14,000 individuals living there. The key thing to this is that the operation area lies in the middle of the two provinces. To the West is on Phichit, and to the East is Phetchabun.
The provincial boundary runs right through the middle of that yellow area. That makes permitting and licensing much harder because we have to do it. We have to double up in order to get all the permits and licenses to support our operation. Not only that, if you look up to the North, that's another province of Phitsanulok. Actually, you are working in the triple junction. Although we don't have any permits and licenses in Phitsanulok, just two is hard enough. I'd like to share with you the work we have done through ESG framework, environment, social, and governance. If you look at the photos up there, not only do we try to adhere with the ESG concept, our work is also in good alignment with UN sustainable goal development as well, whether it be the access to clean water, education, partnership, environment, gender equality.
In terms of the E environment, it's rather straightforward. There are guidelines from EIA, EHIA, and several other conditions from the government. We simply follow that. As you can see on the map, several monitoring stations, whether it be surface water, groundwater, noise, dust, vibration, and so on. We work in very stringent conditions. That's not all. We try to do more, especially from an environmental point of view. We coordinate with several other forestry agencies and community forest network in order to do tree plantations and to set up fire breaks in order to protect the trees that we have planted or trees that have been there to ensure that we take a part in environmental care. If you are interested in the numbers that's up there, we collected more than 11 tons of leaves, dry leaves, and turned it into compost.
The fire breaks could safeguard 1.5 million trees. We grew an additional 50,000 trees each year. This is interesting because we have a massive amount of tailings from the processing, and it has just occurred between our team and Chulalongkorn University people, which is the very renowned university in Thailand, that we're going to do some research on the potential use of tailings in construction material. We have been doing that for six months now. It is clear, first, that the bricks we have tried are safe enough. It does not release any metal substance or anything indoor or outdoor. We are now going to another step, trying various ingredients of this together with cement and so on. At the moment, the satisfactory proportion is that we use about 15% of tailings with several other materials to make up a brick like that.
From the S, which is the main part of my talk, it's most difficult. We have what we call four pillars of sustainability to follow. Rather than doing this and that, this and that all the time, there's a pillar to stay with. The first one is access to clean water. We have a maintenance team to roam around the 28 villages to take care of the water filtration system to ensure that our neighbors have access to clean water. We are at the moment trying to use some of the water in our pits to help farmers in the drought period. On health, we provide free healthcare services for people around the mine site. Each year, there are about 600-700 people who come to this health check.
We give back the record of the health to local hospitals so that they could look after their people with good sets of data. We also do a lot of income generation by bringing in resource people to teach those who are already there doing this and that, handicrafts and so on, and upgrade their products. We also help them with sales channels through several social media. For education, we adhere strongly with the Chatree Open Mind concept. Anybody, any group can come have a look at our operation, whether it be the local government bodies, universities, self-administrative organizations, and so on. One of the most common comments we've got from their visit is that there's nothing to fear. These are the pictures of some of our activities. The one in the upper left is how swift we do that almost every day basis.
There will be health check, blood donation, flood relief, fire victims. This is also another attempt on flood relief, as you may have heard from the news that this year we faced a number of flood incidents, whether it be in the North, in our own area, or in the South. This is pretty interesting. Actually, we have a clip to show how fun these activities are, but the system here does not support. The key thing is that on every weekend, my office is turned into a childcare. One hundred childs, plus or minus, come to learn some extra lesson, like Muay Thai, although we do not support using of force. Please look at it as a national heritage. Look at it as one of the ways to teach discipline, exercise. That is our English class.
In addition to regular curriculum they learn at school, we teach not only English but Chinese, and then traditional Thai music, modern music, and arts for the kids. On the G side, similar to the E, we just follow all the guidelines and regulations. There is one thing called quarterly inspection where about 30 people from 30 officers from various agencies come to the mine site every quarter and do the check. They stay with us for three days, check everything from operation, safety, and this and that. They give us a tick, tick, tick, tick, tick. Usually, there is not much of direction to correct or to do this. All of them usually are minor. The key thing also is that we try to do the two-way communications through our community team and so on.
One of the things is that in the community team, there are about 22 people. All of them live within the five-kilometer radius. It is easy enough, like walking to an auntie, an uncle, or even schoolmates. That facilitates two-way communication. There's an opportunity for us to spread out our news and then listen to what they have to say. This is a recap of some of the figures that you may be interested in. We maintain 98% of Thai workforce. We visit more than 3,000 households, and we plan to cover all those 50,000 soon enough. We participated in more than 100 village meetings. Annual health check, I said that earlier. We recycle about 600 tons of waste. We plant trees with the community forest network, and we maintain water quality for 16 filtration systems. Community work is the heart of our operation.
With the hard work we have done so far, I can say that we passed any community hearing in the area. As you may know, in Thailand, community hearing is the entrance to all permits and licenses. There are various degrees of doing this community hearing, but we are proud to tell you that we passed all. Okay. What we have done, I think I would like to summarize it in this slide. We are able to build up trust and confidence in our operation, foster a positive Chatree community, as I showed you in the first slide, and deliver effective community consultation programs. We also have been active in doing a lot of things to raise quality of life for the people surrounding our operation. I hope you are proud with what your company has been doing. Thank you.
Thank you very much, Jamie and Khun Cherdsak and the young ladies from Thailand. As you can see, our community involvement up there is a very, very important part of our operation. Our people do a very, very good job, and we're very proud of them. We are very happy to have you down here with us. Thank you. Now, are there any questions at all from my Chairman's address or from the CEO's presentation? Would anybody like to ask questions? Of course, first question from Mr. [Keith Goode].
I am limited to two. Firstly, your reference to Evolution was, of course, related to them paying dividends. Consequently, the obvious question then is, how far down the line do you think it might be before Kingsgate resumes paying some of those juicy dividends it always used to pay?
Would you like me to handle that?
Yes.
As you know, our philosophy on companies is that we believe strongly in dividends and returning to shareholders. It's something that we've looked at very closely over the last 12 months. I hope it won't be very long before we're paying dividends again. We've had a number of requirements that we need cash for. We still have a debt, of course. We are being a little conservative on it at the present time. If things go as planned, it should not be very long at all before we're paying dividends again.
Thanks, Ross. Second question. There was always a concept that you might increase the leach tanks to increase the silver recovery. What happened to that?
Good question, Keith. We've looked at this.
I remember you asked this last year, and we've thought about it internally and looked at the first thing I would say is that when we were producing back pre-2016, the recoveries for silver were in the 40% range. I noticed in our September quarterly, silver recoveries were up, I think, 60%-62%. They've actually come up naturally through some changes to the steel wool and things. One thing we have asked, and I know we spoke about maybe should we have a Merrill Crowe, would it suit our processing circuit, things like that. We've actually asked Bob Kennedy, the Processing Manager, to look at whether some additional drop-ins would improve that. Just maybe basic answer was 40%. We've got it in the 60s. It's certainly on our mind. Yeah.
Perhaps a third one. I'd be disappointed if there wasn't.
What's the chance of reducing the royalty?
Thank you. That's an ongoing negotiation point, and it always has been. I think I touched on it quickly just to say that it is a high royalty because it effectively follows the gold price up. Obviously, when we were operating pre-2016, gold was around $1,000-$1,200, so we were not paying much of a royalty. The first thing to remember is if gold price comes down, the royalty comes down. That's a positive natural hedge against our all-in cost. Those negotiations or those conversations about the royalties are ongoing. We have had some reception, I should say. One thing I will also add, obviously, there has been a number of changes of government in Thailand in previous years, in fact, four, I think, in the last two and a half years.
While we've made progress with some when the government changes, we're kind of back to reset the relationship. Certainly, it's on our mind. We've even put some modeling up at some points. The point I should make is that the TAFTA has no bearing on that. That's an ongoing commercial negotiation anyway, and we'll update the market on that when we can.
Thank you.
If I might add, it's a hope that we could still talk to the government. As Jamie said, we've had four changes, I think, in the last two years. The current government that we've got there at the moment is fairly temporary. They're going to have an election in the next few months, we expect. Until we know who we're negotiating with and who to talk to about it, it's a little difficult to advance.
[Vito Ignazzi].
This morning, of course, there was an announcement about the settlement is over. Basically, it looks like it's just that's it. It's over, and there's nothing to be compensated either way. However, I suspect there are some details that can be disclosed once things are settled. When will that roughly be? How many months from now before you'll be able to tell us anything else that's in that package?
Yeah. I think in our announcement, we say, obviously, the tribunal's going through that process. There's still some paperwork that needs to be done. We'll obviously update the market as we go. Maybe one blanket point that I can say without breaching any confidentiality rules is that out of this, there are some commercial opportunities for us to expand our footprint in Thailand that we will be pursuing vigorously. When we can, we will say things.
Thank you. Mr. Ross, it did come up about the dividends. This is sort of carrying on from that because it sort of begs the question about capital management. I know that there's a resolution about buying back shares. I guess there's various things that the company can do with their excess cash. It could be dividends, could be the share buyback, could be repaying debt. It could also be the cash that'd be required for existing operations or cash for the South American operations there. Could I just ask about the South American operations? What have you got in mind for that? Probably what's your priorities in terms of your cash management?
Do you want me to have a go and then you say,
"Oh, you have a go."
You're not going to have to do it.
No, no. That's important.
The priority always is to pay back debt. One thing we've learned coming back to life, particularly talking to our learned friends on the analyst side, is that whenever you can report a cash build, you get a commensurate up in the share price. That is certainly the case. We do not have to build a war chest or anything like that now. I would say if you look in our September quarterly, we actually clearly outline what our capital outlay might look like for the next little while. It is actually pretty modest. There is not a lot in there. We are putting a tracking system in the trucks. We are doing a little bit of work on the mills. There is not a lot to go. I think it is a combination of all three.
We want to reduce leverage because that helps us, obviously, in a whole range of reasons in terms of costs, borrowing costs, things like that. As I mentioned earlier, the share buybacks are on constant monitoring. If we think there's an opportunity in the market, we'll get back in there. Also, in terms of dividend, as the Chairman rightly says, without boring everyone to tears, there are a few accounting procedures and other things that we're just working through. Obviously, appreciate we had no profit and no money for a long time. There are some attributable tax losses and other things like that that we just need to be confident that we've got the right advice and all of that sort of stuff. We are working through those processes in terms of dividend.
How that fits into Nueva Esperanza, one of the things that, and I've said this before, and I want to sort of maybe reiterate the point, now that we're cash generating out of Chatree, we don't want to pour it all into South America. We'd rather see some of it go to you, go to buybacks, obviously growing to Chatree because, as I say, I can't really say yet, but there's some really good commercial opportunities we want to pursue up there. We want to make sure we've got enough money to do that because we think that's where the value creation is. The idea has always been with Nueva Esperanza either to find a joint venture partner to co-fund it with us so we're not completely in the hole for it, or we'll look to fund it externally.
One of those ideas was to put it on the North American market, the TSX, and obviously fund it into development. That is certainly being significantly progressed. As I said, we have not really mentioned it, but Byron is here with us internally as an investment banker, good skills in this area. He is looking at all of that. We do not want to spend all of our hard earn on Chatree on South America. We want to give some back to you. We want to build Chatree. South America, we want to be self-funding or partnership funding.
I think I might be wrong, Sam. I think last year you may have said that there were people looking at the South American. I am just wondering if they are still looking at it or.
Yes, absolutely. Again, we have been a little bit slow on that.
We've obviously had some work streams to update. There's still several, I guess, parties capable of transacting with us. The other point I'd like to make is that now that we're back, now that we're a billion-dollar gold company, we can take our time and find a good partner. It's not a fire sale. We don't need to monetize it. Because we made no secret, yes, we've had the shingle out for selling it for a long time, that was because we needed money to work through the legal processes in Thailand. I think we've said we had a couple of offers there, but most of that was shares and things like that that we couldn't monetize.
Now that we're back, now that we're actually generating cash, now that we're cash building, we can make sure that whatever we do with Nueva Esperanza is a good fit and generates value for you.
I'd just like to say in the other presentation on ESG, I'm proud to be a shareholder seeing all the good things that they're doing.
Thank you. That is really important. This is why we wanted our Thai people to come here because I can stand up and say it and you go, "I've seen him say that. I've seen that slide.
Boring. I would recommend, because the team have some of the handicrafts and some of the things that they do here outside on your way out, drop in and have a chat with them because A, you wouldn't find lovelier people, B, you wouldn't find people more committed to their job, they're generational in this, and C, that's why we got upset when the place was closed down and people started saying we were doing the wrong things there. We have got one of the best and longest track records of ESG credentials, I think, in the whole sector, and it made us really upset. This is why we wanted to show you the proof. Thank you for the feedback. We really appreciate it.
Yeah. I'd also like to say you're a very small board, but I think you work very hard.
Sometimes you go to these companies and there's about 20 people sitting up there and you wonder what the hell they do.
Yeah. No, thank you. I can tell you it's been a wild ride.
I know it has, but you guys have done a great job, so thank you.
Thank you very much. We really appreciate it. Thank you. Yes, Timmy.
We're now on our third year since we pre-commenced mining. You've got reserves in front of you for almost another 10 years, yet our mining license is only four and a half years. Can you tell us if there's been any progress in having that way out of date lengthened?
Yes. Yes. Actually, let me explain. This is important. The Chatree leases are divided into two categories, North and South. Unfortunately, they don't have uniform expiration dates.
What happens is half come up at one time and the other half come up at the other. This is an idiosyncrasy of Thai mining law in that we can't uniformly roll them over together. What happens is when the next batch of mining licenses come up for renewal, which is the Chatree South leases, we actually have to put in a new mine plan, whether we have one or not, to include the renewals. That's why it happens. Yes, it's not necessarily efficient, but this is one of the things now that with Kingsgate 2.0, Thailand 2.0, we'll raise with the government to look at operating amendments to their mining act so that, for example, we could get 10 years, which is generally the regulatory period for a mining lease anyway.
That's a really important point, but it's because of a quirk in their law. It's extra admin for us. This team here has to do it. We apply well in advance. We'll apply 18 months out so that there's no surprises come the deadline and all of that. It's because we have leases that expire at different times. We can't uniformly roll them over. That's what we're going to ask them to legislate for us.
You're on top of it, Jamie, as much as you can be.
Yes. Yes. Absolutely.
Thank you.
In fact, these guys have already started for a lease renewal in 2028. They've shown me things on it already. That's how good they are.
Jamie, how many permits and licenses do we have too?
Just for sort of general edification, to run Chatree, sort of general gold mine, we need more than 300 licenses and permits on a rolling annual basis. At any given time, 10, 15, 20 might be up for renewal. We work through it. Factory licenses, mining licenses, cyanide permits, electricity permits, gas, water, copper, sulfur, you name it, we've got a permit for it. This lady here has got a spreadsheet taller than her that runs them all for us. These are the people. Yeah. You should give her a go. These are the people that are going to. Yeah. She shows me the Gantt charts, and that's also why I'm going blind. She's got it all out there with all the key dates, key dates for lodgement, all of that sort of stuff.
Thank you, Jamie.
Thank you. My name's [John Ritson].
I had a question about sovereign risk insurance. I mean, we had it once before. Will we be renewing it now that TAFTA's put to bed?
I don't know.
Do you think anyone will cover it?
Look, having said that, there are insurers that have certainly expressed interest in insuring Akara as the subsidiary. I guess we have prudently thought about it, but we have not needed to while we have been doing what we are doing. Having said that, we will certainly take steps if we think that is appropriate. Actually, Mischa's nodding at me.
Yes. We have to reassess the market there. At one stage, it was pretty solid that there was not too much sovereign risk stuff going up into the area, I do not think. It may have changed a little bit. We will be looking at it.
I'll just add a quick comment to that. What we found with the sort of most recent Thai governments is post-COVID, because Thailand is a largely tourism-based economy, there's a recognition now that they need other industry, other investment. Particularly through the critical minerals side of things, they've recognized that mining could be a feasible industry for them. We're seeing a level of engagement now like we haven't seen before. In fact, we've got meetings. We're actually, I think, due to catch up with the Deputy Prime Minister next week that runs the industry cluster. Board of Investment's keen to talk to us about how we might joint venture with them on some projects as well. We're seeing a level of engagement and an acknowledgment of mining that we probably haven't seen previously.
I refer to the Section 44 order made by the military government in 2016 shutting down the Chatree mine. Has that Section 44 order been repealed?
If I can go back over a little bit of history, it appears that some of the press, etc., in Thailand think that Section 44 was an issue. Section 44 was an inconvenient thing to us, but it was never an issue. In the case that we had before the International Tribunal, it was about expropriation over quite a period. Basically, all of the things had been done before the military government went to that Section 44. Something that I probably haven't shared with many people, the Section 44 thing wasn't done for anything that they think up there.
It was done to protect the minister at the time, who was a woman and who thought that she had a personal liability in our situation. She made representations to the Prime Minister at the time and got that Section 44. A lot of the press, and there's even been some press lately that we were talking about it, have mentioned Section 44. It's never been an issue to us. It's something that happened after all of the things that happened.
It's not likely to haunt us in the future. Is that what you're going to say? Sorry, what was that?
I don't think it will haunt us in the future.
In fact, what Thailand has been doing, and you may have noticed, is during that era where Section 44s were used, and just for general information, what a Section 44 is, it's like a martial law power. Thailand has it at discretion. They use it on a whole range of things. No riding in the back of utes, closing gold mines, you name it. It's what it was. As Ross rightly says, they did use it for us, credit to us. It was the first foreign company they'd ever used it on, one for the book. What they've been doing progressively as the new governments have been in is there's constitutional reform underway. They've actually been repealing a whole bunch of them.
We expect now that we have settled the TAFTA and we have reset the relationship, that we expect that our Section 44 order will be repealed in due course as well. It has no legal bearing on anything that we are doing. It is business as usual for us.
Is Section 44 still active in the constitution? Is it still there?
I believe it is.
I believe it is.
They have extinguished it for a number of areas that it was used against companies. They have not done it in our case, apparently. We would be talking to them about now that the TAFTA situation is settled, that that might be something that they should look at.
Okay. Next question is on the sustainability report.
I noticed that Kingsgate does not seem to be supporting the mountain bike track that has been built around Chatree, which is of international grade for international competitions. Is there any reason why Kingsgate is not involved with that?
No. Look, it's a little bit complicated because what happened, and maybe Khun Cherdsak can correct me if I'm wrong, one of the regional governors thought it'd be a good idea to put a mountain bike track near the mine. Just for safety reasons, obviously, we support all the community initiatives, but we can't have sort of unregulated or visitors that don't report into the site, riding bikes around the site. That's all. I think we've actually discussed with them alternative areas, and we have a good relationship with that governor. There's no issue. I think that's what happened, isn't it, Khun Cherdsak?
Yeah.
Remember the bike track that we're going to put there? We couldn't have it.
They did have some function there one day, didn't they? They did have a function, but we need to be really careful about the health and safety aspect of everything. It is just not appropriate around those mines.
Yeah. We just didn't want bikes going into the sea pit and all that sort of stuff. Yeah. Some of those pits are quite deep. There is a lot of water in them. Yeah. Most of them can't swim. Oh, sorry.
Go down. Go down. Go down. Are we in any way supporting it financially?
No is in that yes, we provide drinks and what do you call it, like support activities and some of the barriers and things like that. Really, that's it.
As you would have seen, we actually contribute to a number of funds where the cash is actually allocated out to various community events. We like it. Don't get us wrong. We're certainly friends with that governor and we do that sort of thing. We provide in-kind support as opposed to financial. They can apply to, if they want to host it again, they can apply to our community fund. That is assessed by a panel of, it's got [DPIM people], it's got our people on it, it's got community people on it. It has proper corporate governance, and then they decide what the best investment opportunities for each of the community regions are. That is how that works. Certainly, we like it, but for safety, we didn't do it.
I wondered whether Kingsgate's lack of support was possibly due to the Thai general having been the person that built the track.
Look, I think again, it's just safety. Because what happened, unfortunately, is they designated a part of the mine that did have genuine safety. We could not have barriers everywhere. Obviously, yes, we think that the cyclists are responsible. If someone gets lost, if someone gets hurt, that's like a public liability for us. We just wanted to be sure that we did not put anyone in harm's way and that we communicated that clearly back to the governor.
Yeah. Can I ask a couple of questions?
Okay. Thank you.
Hello. My name's [Gary]. I just want to ask, in one of your announcements, you stated that you found a deposit that's probably equal to Chatree about 3 km South.
It goes to my question to say that the length of the mine's nine years, does that then not get increased at only the time when that SPL turns into MLA? Is that when the length of the mine increases from nine to whatever? Is that correct?
Yeah. Spot on, [Gary]. That's correct. Yeah. I just wasn't sure if that was. Yeah. Just on that, they're also working on that now too. We're working on the ML for that. Yeah. I thought it was an SPL MLA problem is why. Because it just stays at nine all the time. I think we're finding gold everywhere, but nothing's going up in that area. Ross tells a good story on this about Central Norseman and how they had two years of reserves for 20 years.
At the moment, because we want to put the money into growing the reserve, like exploring and making sure we find all these areas. Look, you're dead right, [Gary]. If we drilled it a bit closer, we could prove up the reserve and we could add more life of mine. We just think the money is a little bit better spent at the moment growing the resource more generally, and we will come back to upgrading the reserve a little bit later. We do have a lot of, as I mentioned. Yes. We do have a lot of drill-ready targets in a whole lot of other areas that are worthwhile following up. Yeah. That is it. The underground as well. Yep. Yep.
My other question is not to be targeting.
You have been keen on the underground for a long time, [Keith], have you not?
My other question is not.
You've got so much open cut, why would you undergo?
My other question is not to be targeting, but with [Kos-ASX], one of the areas I looked at, which I thought was interesting to ask, is to say that we supply the Caterpillar, which is the appliances, the real thing that does it, but someone has to drive them. That company, I believe, is Lotus Hall. Correct. I saw the bill at AUD 23 million, which I thought, and I don't know, but that's a lot of money for just drivers, unless I'm missing the mark. I thought it should be lower than that. That's all.
They provide a whole range of services. We've got the 20777s, we've got the 6030s, we've got water trucks. There's a whole lot of other things. They do grade-controlled drilling as well.
Their staff complement, I think, is around 3,350, closer to 4,000. It is actually for a reasonable size workforce. We pay them, again, based on the skill level for the job that they are doing. Obviously, truck drivers are a bit more than, say, something lesser. Diggers are a bit more than that. We have a proper labor rate. The other thing I would say is that Thai labor law is quite strict on all of these things. We make sure that we comply with all of that. You are right, Gary. That is one of the areas we always think there is room you can squeeze margins is on your operating costs, particularly the mining contractor. That is one of the areas that we have been talking to them about, how we incentivize them to produce more but maintain a cap on wages or similar.
That's something that's ongoing.
All right. Thank you.
Over to [audio distortion].
My name's [Nico O'Connor]. Does the company have any remaining obligations to Zurich over the TAFTA fight? Do we have any Zurich obligations? Do we have insurer obligations? We obviously are in a process where we're talking to Zurich, and we'll say something on that when we need to. It's probably we don't think so, but we'll say something when we need to.
Our views are probably a little different. Anyway, let's see.
Go on.
Yep. Asking a further question on a question that was previously raised about the leaching rate. Right now, there's about 40% lost in the silver. Now, can that 40% be recovered in the future from the tailings because it'll be in the tailings? Is it conceivable to recover it from there?
I think the answer is no, not really.
The thing to keep in mind is the silver grade's pretty low, right? It's actually single digit, which is very low for silver. Obviously, double digit's great, triple digit's amazing, four digits, we're really enjoying it. I think our head grade for silver's around 7 grams or 9 grams or something, Jill? Yeah. Which is really low on a silver comparable basis. Having said that, as I said, we've been able to get the recoveries up roughly 20% from last time. We've made some tweaks to the blend. No, we can't, and not really out in the tailings either. We take it on notice that we're looking at how we might be able to tweak a little bit more out of it.
No. The silver thing is interesting. As Jamie says, I think we're averaging probably 6 grams or 7 grams per ton silver overall.
We have had higher at different times. It was a question before, and we're certainly looking at the Merrill Crowe situation. We may use it. One of the significant things, and if you have a look at some of those drilling results in the South-East Complex, there is some high-grade gold. There is this one area that was quite high silver. Quite high. In fact, it's about 150, wasn't it, or something, I think? Jill? Yeah. That's quite interesting. Looking into the future, there's something there that we will investigate and see if there's something we can do that we would get a greater return out of. Finally, regarding the all-in sustaining cost, the FY 2026 guidance says the pre-royalty AISC will be between $1,550-$1,750 per ounce.
That seems to be pretty large compared to what we currently do at AUD 1,166 an ounce.
Do you want Michelle? Or Michelle maybe. Yeah. You're like the shareholders. Michelle, you can come on. Come here. Come here and have a go.
Thank you. Sorry. Who was asking? Sorry. You can see us then most of the time hidden out the back, so. Look, you're right that this quarter was exceptionally good. There are probably a couple of factors there. One is just that the production itself was higher than expected. Therefore, when you express it on an AISC basis, it's going to be favorable. The second thing is just actually if you look at the mine plan, as Jamie alluded to, next quarter is going to be softer. The numbers that we've put out is on an average basis, so what we expect for the whole of FY 2026.
There will be a little bit of volatility in there. What we've had in the first quarter is obviously a little bit lower. We expect it to be a little bit higher through this quarter, and then it sort of tapers out and evens through quarter three and quarter four. Yes, there'll always be a little bit of volatility. We always say there are good quarters, bad quarters, and average quarters. That's just going to be part of the numbers that you see. There shouldn't be too concerned. We're well on track at the moment.
Yes. We ask those questions internally all the time because it changes from month to month, quarter to quarter.
Mine's not a question. Mine's just to say thank you to you two and the board.
Geez, you guys have done an outstanding job under what I think was unsurmountable odds of getting this thing back at all. God, I had a great year.
Thank you.
Thank you very much. We appreciate it. Thank you, everybody. Thank you. It's been a hard road, I can tell you. You don't see even a fraction of the things that we have to get over. Nevertheless, it is satisfying if we've been able to do what we said we would do. There's still further upside. I was going to say later, but I think this year could well be quite outstanding here for this company. Anyway. Now, if there's no more questions here in the auditorium, do we have any online, Bronwyn?
Yes, there's two online questions here.
One is about the reelection of Peter Warren as a director. Which of the proxy advisors covered us this year? Did any recommend a vote against any of today's resolutions, including Peter Warren's reelection? If so, what reasons did they give? Did this translate into any material protest votes?
Yes. I'll answer that. We were covered by two proxy advisors this year, Glass Lewis and ISS. ISS recommended against Peter. They were the only ones. Voted for all other resolutions. I think Glass Lewis voted for all other resolutions.
Great. Thank you. We have a question for the auditor. Like last year, could PwC's current signing partner, Craig, please comment as to why we are still carrying negative equity of AUD 121 million and accumulated losses of AUD 859 million?
This doesn't bear much resemblance to the market's assessment that our equity is today worth AUD 1 billion. Does the audit process take into account this disparity between the book value and market value? Is there anything we can do to make the accounts more accurate? Over to you, Craig. That is a long question. Thank you.
Very long question. Thank you for the question. I'm not quite clear on just the thrust of some of the numbers. I don't think we've got negative equity. I think the equity in the balance sheet is positive, AUD 319 million. I think the thrust of the question relates to the disparity between the share price, which is based on trading and market conditions, and the net assets of the company, which are really based on the accounting standards.
The accounting standards would require the accounts to be prepared using the historical cost basis, which is quite different from a fair value measurement basis. That would be the reason for this disparity.
Great. Thank you. That's it from us.
Thank you. All righty. If there are no further questions, oh, hold on. Hold on. We found one.
I was just going to ask you because I noticed they're talking about Peter's reelection. Are we doing all the questions on all the resolutions?
Yeah. I'm about to get to all that.
That's all right. We sort of jumped the gun a bit, so.
Yeah. Sorry.
No, that's all right.
It's getting a bit later, I know.
Just a question on the resolution.
All right. Next is formal business.
The minutes of the previous AGM and the last annual general meeting was held on the 26th of November, 2024. The minutes of the 26th of November, 2024 meeting have been signed as a true and correct record and are available for inspection. I now refer to the notice of meeting dated October 25, and we'll take the notice of meeting as read. The business of the meeting comprises the following: firstly, to receive and consider the company's financial report and the reports of the directors and the auditor for the financial year end of 30th of June, 2025. Then to consider and, if thought fit, pass the following resolutions. One, Resolution 1, reelection of Peter Warren as the director; two, the approval of an on-market buyback of up to 50% of Kingsgate shares; and three, adoption of the remuneration report.
The first item of business to receive and consider the financial report and the report of directors and auditors for the financial year end of 30th of June, 2025, as set out in the company's 2025 annual report. No vote is required for this item. As mentioned earlier, our auditor, PwC, is present. We know that. He just talked to us. He is available to take questions on the audit report if there are any. I will ask for any questions on the financial statements or questions to our auditor on the conduct of the audit and their audit report. Are there any questions at all? No? That has done a good job. Are there any questions online?
Already answered. Thank you.
Already answered. All right. Thank you. We will move on to the major resolutions then. The first resolution is the reelection of Peter Warren as a director.
Shareholders are requested to consider, if thought fit, to pass the following resolution as an ordinary resolution: that Peter Warren, a director of the company, retiring by rotation in accordance with the company's constitution and the ASX listing rules, and being eligible, be reelected as a director of the company. Valid proxies received in respect of that resolution are as displayed on the screen. As previously stated, voting on all resolutions is to be conducted by way of a poll after all resolutions have been read. Are there any questions on this resolution? I would just like to add that Peter has been a great stalwart and warrior to the company for a long, long time. His contributions have been exceptionally important to us over time. He's very good on the financial side of things, as you probably know. He was a previous CFO of the company.
I certainly commend the election of Peter back to our record. All right. We are putting these three resolutions together when you are voting things. Resolution 2 is the approval of an on-market buyback for up to 50% of the shares. Shareholders are requested to consider and, if thought fit, to pass the following resolution as an ordinary resolution. That for the purpose of Section 257C of the Corporations Act 2001 and for all other purposes, approval is given for the company to buy back up to 50%, which is 128,280,786 shares of the company's issued shares in the 12-month period following the approval of this resolution at the election of the board and otherwise on the terms and conditions set out in the explanatory memorandum. Valid proxies received in respect of this resolution are as displayed on the screen. Are there any questions on this resolution?
As we mentioned before, it's one that we have passed a number of times, and we did utilise the buyback earlier in the year. Any questions online? No? No. We'll move on to Resolution 3, the adoption of the remuneration report. Shareholders are requested to consider and, if thought fit, to pass the following non-binding resolution as an ordinary resolution: that the remuneration report for the year end of 30th of June, 2025, be accepted. That be adopted. I'm sorry. Valid proxies received in respect of this resolution are as displayed on the screen. It should be noted that votes from parties to whom the voting exclusion applies have been excluded. That includes people like me. Are there any questions on this resolution? Yes, sir.
I think last year you had a lot of votes against.
I was sort of thinking, do I vote against or for this year? The reason I'd vote against is I don't think you guys are paid enough. You probably deserve more.
I can only endorse that.
That's why if I vote against it, you'll know why. I think you'll know.
When I do look around and see, you get a lot of companies, and they say, "If you pay peanuts, you'll get monkeys." I'm not saying you guys are monkeys, but maybe in some companies, better have monkeys there. I think you guys have done a terrific job, so thanks very much. Thank you.
Thank you very much. I very much appreciate that. I can certainly tell you that we try very hard. What you see is what you get.
Yes, I know that our people are looking at an incentive scheme that we've been talking about for some time. I don't know exactly what it all entails this time, but I believe I'm going to get a report on it fairly soon. I think you're ready. We'll see. I'm sure it won't break the bank. Nevertheless, there is some smaller incentive coming up for executives and directors, I believe. I think the key point is alignment of interest. That's what we focus on. Share price goes well, company performs well, and then remuneration accordingly.
I think in some cases, you don't get that alignment of interest because some directors don't want to do anything without being paid. I think you guys have got your job.
I mean, even in the last week or so, I've been taking calls at 12:00 and 10:00 at night and stuff. Anyway. All right. Is there any other questions there at all? No. Anything online? No? No. Thank you. If there are no more questions, we'll move on to the voting of the resolution by poll. They want me to go through the poll procedure again. Anyway, I provide an overview of the poll procedure and invite the share register, MUFG, to conduct the poll. [Aaron Carter] is the returning officer for the poll. For those attending virtually, please follow the instructions displayed on your screen to submit your votes. For those in attendance, please ensure the yellow voting card is completed by marking for, against, or abstain on each resolution. You may complete your voting card now. No. You don't need one.
I've already got a proxy in. MUFG are now circulating through the room and collecting the voting cards. The poll will close five minutes after the meeting has been closed. The results from today's meeting will be released to the ASX and also made available on the company's website as soon as practicable later today. All right. All right. Ladies and gentlemen, that finishes the formal business of the meeting. I thank you very much for your attendance again. I certainly, on behalf of the board, thank you for your support. I now close the meeting. Thank you very much.