Noosa Mining Investor Conference

Jul 24, 2025

Slides

Thank you Katrina, and also thank you to Morgans, Phil, Des, and the Equity Events team. In the 15 minutes I have available this morning, I just wanted to talk about three key things. 1. Cash flow, everyone's favorite subject. 2. The upcoming combination with Spartan, the wait is almost over. 3. An exploration summary. Yes, we do believe there's plenty of upside to the story. A couple of slides of disclaimers. I may start with the corporate overview. Looking at top left, our market cap currently, or last week anyway, was about $2.8 billion. If you put that side by side with the over $800 million we have in cash and gold and no debt, that's an enterprise value of only $2 billion. Earlier this month, we announced record gold production for FY25 of 301,000 oz and pointed to our all-in sustaining costs being at the lower end of our range, $1,550 to $1,650. I'll point out this follows on from a record year in FY24, so I have to mention the great job done by our OPS team. Some of the key people you can see on the bottom right, along with the beefed-up projects and integration team as we prepare for things to come. Our project locations, for those who aren't aware, Mount Magnet is our flagship operation. Ramelius has produced over 2 million ounces of gold since we took ownership in 2014. Rebecca, east of Kalgoorlie, is currently going from PFS to DFS with the final investment decision due later this quarter. Just quickly on Edna May, it is in care and maintenance as we speak. It will remain this way for now as we focus on not only our current projects but the upcoming integration of Spartan's Dalgoranga assets. Before I get into cash flows, a reminder of where we are headed. We have a vision of being a 500,000 ounce producer by FY30 and ideally within all-in sustaining cost range similar to where we sit currently. This is a chart that you may have seen previously, but it has been tweaked. Mount Magnet and Rebecca production profiles are shown in the dark blue and the light blue respectively, with the combined all-in sustaining costs for those two assets being the solid line at the top. What we've tried to show here in orange is what we are targeting from the Dalgoranga asset, both in terms of production ramp up and also with the orange dotted all-in sustaining cost line. What we're hoping to do with all-in sustaining costs is basically stay in a sector-leading position on all-in sustaining costs. Once at 500,000 ounces, we believe this is sustainable for many years. Before I go to the full year cash flow, a look at the quarter's cash flow. As I said last year, isn't this what it's all about as a gold producer? In the June quarter, $208 million of underlying free cash flow before paying out a $0.03 interim dividend in April and also having to pay the taxman some 8% of revenue currently, such is life being a successful gold producer. The silver lining there is, I suppose we're able to pay over $400 million in fully franked dividends in the future given our franking credit position. If we look at the full year firstly, just back to FY2024, we did $315 million in underlying free cash flow and we're pretty proud of that. This year we've smashed that number with a figure almost at $700 million in underlying free cash flow. You can see the quarterly cash flows in the yellow bars on the left hand side. On the right hand side you can see the one offs, which are the Spartan investment dividends and income tax paid, which I think you'll agree are all pretty chunky amounts. What you may not be aware of is the $809 million that we finished the end of the year with was about $15 million lower than it would have otherwise been if we had not pre-delivered into some forward sales in the third quarter of FY2026 to reduce our hedge book going forward. I have a slide on that coming up. Last point on this. Underlying free cash flow for the last two years at Ramelius has been over $1 billion. Now what do I mean when I talk about sector leading cash flows and costs? Essentially I'm talking about the left hand chart here. Ramelius currently has and has had for a while now the highest free cash flow margin per ounce, as you can see on the left hand chart. These numbers are for the first three quarters of FY2025 and I'm pretty confident that will still hold for the fourth quarter just complete. On the right hand side we're showing the total gross free cash flow. Interestingly, we come in at second there, remembering that we're competing in some cases against much larger producers. I mentioned margins just now. Here you see the margin overall in sustaining cost over the last decade. The 63% margin in 2025 may not mean much to you, but the fact of the matter is that we're producing our best margins by mining our highest quality ore at the right time, which is in a record gold price environment. As mentioned at the top, we believe this Spartan combination will allow these high margins to continue for many years. Also pointing out that we are one of the most reliable gold producers in terms of delivery on guidance, being the only mid-tier gold producer to hit both production and cost guidance in every one of the last five years including this year. Just quickly on our hedge book, following the pre-delivery of 7,000 ounces from the third quarter of FY26 as I mentioned, that leaves some 56,000 ounces of forward sales as at June 30 at an average price of $3,283. That's the right-hand chart. 56,000 ounces. We have been reducing our hedge book since March 2023. Therefore, our exposure to the spot gold price increases from around 70% this year to be effectively unhedged by FY27, which is really the left-hand chart. Lastly, we do have a small amount of zero cost collars with pretty attractive price ranges as you can see there on the bottom dot point, and they seem to be what producers are moving to in this high gold price environment. In general, the reason why we have such good margins is that more often than not we do accretive deals here. You would have seen this chart before, I'm sure. We track our progress on delivering returns on our M&A activity by project. We show the purchase price in blue, whether it's cash or script or a combination of the two, the cash generated in yellow, and the net cash being the dot, and obviously the number in square brackets in the last. The right-hand set of assets is performance for the June quarter, with Q actually outstripping Penny once again. In fact, Q has paid back the original purchase price of around $200 million and about $30 million of CapEx, paid that back, and is now well in the black after only nine months of production. Quite amazing performance out of that asset. That leaves basically all the projects have made money. There's no accounting, and this is just pure cash in, cash out, leaving just Rebecca and Roe, which are subject to study. That's to be expected, that the only projects that owe the company money. Onto the Spartan transaction, we're almost there. We've got past the scheme date earlier this month on Monday. The second court date implementation date is July 31, and our team is planning to be both on site and in the corporate office with the Spartan team to ensure a smooth transition over that period. The takeover offer process, which was potentially a backup option for us, has fallen away, and I have to say that the entire process, whilst lengthy, has gone very smoothly at Dalgoranga itself. The Juniper decline, as you can see over here, not far from the upper part of the Never Never, orbiting the development to the left. The Jumbo development and its associated activities has meant that diamond drilling has only really been able to be carried out in this area effectively into the West Winds and Applewood area. Some results I'll talk about shortly. Soon this area will be freed up to actually have an underground diamond rig in to drill into Never Never, Pepper, and the Freak area, which is obviously not so possible from over this side. There is some surface drilling ongoing at Dalgoranga as well. In terms of integration work, we've done a fair amount of work. We've done a lot of work and sometimes having access to people and resources is not always forthcoming during a scheme. The Spartan team have been great and allowed us really good access. There is still a bit of work to do, it's fair to say. The mine design and scheduling is largely done, but there's a lot of work ongoing on the various processing options. We are running metallurgical test work combining Dalgoranga ore with Mount Magnet ore, which is primarily Eridanus, to measure overall performance, noting that the Dalgoranga ore ideally requires a finer grind. This has led to the team having a list of up to eight options on processing to ensure that we are looking at all avenues to land on effectively the highest value option. We're committed to having these studies come to market in the December quarter, if not earlier if we're able to. Now, I've attempted to summarize exploration for today's presentation, but I will say that we are looking to significantly increase our exploration spend this year compared to last. Across the portfolio we have a number of high quality targets. We're currently drilling at Penny. We're following up the encouraging hits we had below Penny North. There should be some more numbers in the upcoming quarterly. At Kew, we had planned to follow up the 6 meters at 60 grams beneath the Break of Day underground. We're also running some air core on the previously Musgrave Evolution joint venture ground to the north. Early days on that work at Mount Magnet itself. We have a surface and underground rig at Galaxy following up the Saturn and Mars ore bodies. We do have a plan to drill Hesperus later, which looks very much like an early stage Eridanus. In terms of Dalgoranga, it does deserve its own slide. Bit of a tongue in cheek comment there. West Winds and Applewood to the south have been drilled for the reasons I mentioned earlier, and there's some really nice numbers there. Potentially not quite as high grade as Never Never and Pepper, but the potential to have a second leg to the underground mine, which can be accessed from a decline that's already been commenced, can provide some real scale to the production capability at Dalgoranga. You will see more detail on exploration across the company come the Diggers and Dealers present conference in a couple of weeks' time. To wrap up with the investment case, we are a reliable operator, something I'm not sure we actually get full credit for. We do have sector-leading free cash flows, but now we have long-life assets and dividend yield. Not all of our peers are paying dividends, and if they are, the yield is generally lower. We paid $190 million over the last five years and our first interim dividend earlier this year. Our 500,000 ounce production target—I don't know of any other mid-tiers that are shooting this high. Increased scale and liquidity and the potential to move into indexes and remain in other indexes. There's been a lot of talk about these indexes. I think things will look pretty positive post completion of the deal in terms of where we sit on a pro forma market cap, etc. Finally, the exploration upside in the combined assets is second to none. Thank you for listening to the Ramelius story.