I'd now like to hand the conference over to Mr. Mark Zeptner, Managing Director and Chief Executive Officer. Please go ahead.
Thank you. Good morning, everyone, and thank you for taking the time to dial in this morning for our September 2026 quarterly results. In addition to the quarterly report, we have released a quarterly results presentation that we will speak to during this call. Both documents have been uploaded on the ASX platform and will also be available on our website shortly. I am joined this morning by members of the executive team, our COO, Tim Hewitt, and our CFO, Darren Millman. Initially, I will be speaking to the highlights for the quarter, which is the first quarter of FY 2027, and then I will pass on to Tim, who will speak to the operating and project highlights, which will include Mount Magnet plant upgrade, Dalgaranga mine development ramp-up, and Rebecca-Roe. Darren will then speak to the financial highlights before I sum up at the end.
While the presentation is relatively high level, I do note that more detail can be found within the quarterly report released today. As usual, there will be an opportunity for listeners to ask questions at the end, whether that be through the teleconference or the webinar, depending on how you have joined the call. So if we can make a start, I will be initially speaking to slide three. Gold production for the quarter was 48,839 oz at an all-in sustaining cost of AUD 2,656. In summary, this was a solid start to FY 2027, underpinned by the processing of 135,000 tons of Never Never underground ore at an average grade of 4.15 g/t . A clear demonstration of the positive impact Dalgaranga is now having on our overall production.
Importantly, we remain on track to achieve our FY 2027 production guidance of 205,000-225,000 oz. Tim will talk further to the mining and milling detail shortly. We finished the quarter with cash and gold of AUD 768 million, up from AUD 650 million at the end of June. The quarter generated operating cash flow of AUD 186 million and underlying free cash flow of AUD 62 million after continued investment in growth capital and exploration. The cash balance was boosted by the completion of the sale of the Edna May Hub to Forrestania Resources, which completed on the 4th of September for a total consideration of AUD 300 million, made up of AUD 210 million in cash and AUD 90 million in Forrestania shares.
These proceeds more than offset the AUD 131 million that we paid in Spartan stamp duty during the quarter. On our growth projects, we were pleased to have secured Primero as the EPC contractor for stage two of the Mount Magnet processing plant upgrade, being the new Circuit 2. Upgrading the existing circuit, Circuit 1, is underway and the broader upgrade has been focused on plant engineering works and preliminary site establishment. At Dalgaranga, the focus has been on continuing to increase production rates from the Never Never underground mine, and we are now also in the final stages of commissioning the paste plant. At Rebecca-Roe, importantly, we received EPA approval of the Part V works application for Roe well ahead of schedule.
Exploration continues to deliver with exceptional results at virtually all of our projects across the portfolio, focused on extending mine life at our existing operations. We had eight surface rigs and four underground rigs in use, and exploration spend, including resource definition, was just under AUD 23 million for the quarter. We won't be getting into the detail today on our reported exploration results as we will provide a more fulsome update in January. But I would encourage you to read the quarterly report, which does include some excellent results, particularly at Galaxy and Gilbey's underground, with grades generally above the exploration targets that we have set for those projects.
On the corporate front, we completed a further AUD 15 million in share buybacks during the quarter, taking the total since announcement to AUD 156 million or 62% of the AUD 250 million share buyback program. Our growth projects remain fully funded, and we remain focused on increasing our returns to shareholders as we grow cash flows. On to slide four, which shows a breakdown of gold production by ore source over the last four quarters. What you can clearly see is the growing contribution from Dalgaranga, which was again our largest single source of production in the September quarter, following the step change that we saw in the June quarter. The contribution from Dalgaranga will continue to grow quarter on quarter.
Production of 48,839 oz was below the 53,466 oz in the June quarter, largely due to wet weather impacting the processing of high-grade Penny ore and also lower grades from both Penny and Never Never underground, which Tim will expand on shortly. The map on the right shows our two high-quality hubs in Western Australia, Mount Magnet, fed by Dalgaranga, Cue, and Penny. Just noting that the old Cue needs further drilling before being considered for development. And also our Rebecca-Roe project east of Kalgoorlie. With that, I'll now hand over to you, Tim.
Thanks, Mark. Good morning, all. Moving to slide five, I will discuss the key production metrics. We mined 0.7 million tonnes of ore at a grade of 2.56 g/t for the quarter. Ore tonnes were up 9% on the June quarter, with increased ore contribution from Cue and Dalgaranga. The mine grade was lower than the June quarter, reflecting an increased contribution from the open pits, both at Cue and Dalgaranga, and lower grades at Penny. At the Mount Magnet processing plant, we milled just over half a million tons, consistent with our recent quarters, and representing an annualized run rate of 2.1 million tons until the plant expansion is complete. Mill grade was 3 g/t , down from 3.59 g/t in the June quarter.
The key contributor to this was haulage from Penny, which was limited in September due to wet weather. This, combined with lower grades from Penny earlier in the quarter and also Never Never, reduced the head grade. Higher-grade material is planned at both Never Never and Cue, resulting in an overall higher processing grade quarter-on-quarter for the rest of the year. Overall, this resulted in gold production of 49,000 oz for the quarter, with a further 4,000 oz stockpiled at Penny at the end of the quarter. Noting that we remain on track to achieve our full-year guidance of 205,000-225,000 oz. Moving to slide six. Mount Magnet update. The processing plant, bring that up to 4.3 million tons per annum.
For those on the call not familiar with the upgrade, the addition of Circuit 2 and the upgrade of Circuit 1 will take the mill capacity to 4.3 million tons and increase the recovery of Dalgaranga ore. As we have outlined previously, Circuit 2 is very conventional. A proven flow sheet design around the Mount Magnet feed blends we have treated for years and we know well. It has the flexibility to potentially take the combined plant to 5 million tons per annum in the future by relaxing the Circuit 1 grind size. The key milestone in the quarter was the award of the EPC contract to Primero to deliver the 3 million tons per annum Circuit 2. On Circuit 1, the new crusher and cyclone tower were integrated into the circuit in October. The next step is the additional ball mill refurbishment and relocation, which is underway.
As a reminder, grinding the Never Never ore finer to improve recovery only requires refurbishing the existing second ball mill, along with some other enhancements such as the new leach feed thickener. The photos on the slide show some of the progress across the broader site. Of note, all wind turbine sections are now on site with the assembly to commence shortly. The additional camp rooms and associated facilities have all landed at the Mount Magnet camp. Long lead items for the site power infrastructure have been ordered, and the ancillary work package is in the final phase of design or out to tender. The table at the bottom of the slide sets out the growth CapEx for the upgrade, considers how we set up the whole site for success.
FY 2027 guidance is AUD 195 million-AUD 215 million for the processing expansion, AUD 35 million-AUD 40 million for processing infrastructure and upgrades, and an additional AUD 40 million-AUD 50 million for mine infrastructure, including road and power upgrades, water, camp, and buildings. This is a total of AUD 270 million-AUD 305 million FY 2027, with a further AUD 52 million-AUD 73 million in our FY 2028 outlook. Moving to Dalgaranga on slide seven, where we continue to ramp up the mine. This remains on track. As Mark mentioned, we processed 135,000 tons of Never Never ore at an average grade of 4.15 g/t during the quarter.
The chart on the right shows monthly ore tons mined, which have increased steadily from under 2,000 tons in October 2025 to a record 46,500 tons in September 2026. We are on track to mine 500,000 tons in FY 2027, and decline development is on track to open up the longest strike of Never Never as we ramp up to 1 million tons per annum for FY 2028. The chart on the left shows the life of mine profile released with our updated plan in September, incorporating actuals from FY 2026 and our FY 2027 guidance, plus longer-term outlook. Through to FY 2036 and beyond, Dalgaranga will continue to produce high-grade tons as a globally relevant low-cost asset. On-site, the team's focus during the quarter has been on completing and commissioning the paste plant.
On to slide eight and Rebecca-Roe, where we continue to make good progress on approvals. During the quarter, we received the Environmental Protection Authority Part V works approval for Roe, and planning has commenced to obtain the associated mining approvals. Rebecca is already fully permitted. The DFS is complete, and the native title agreement has been signed. Rebecca-Roe is a greenfield development that will incorporate our 3.25 million ton per annum processing plant. We have established most of the project team to build Rebecca-Roe and have been advancing early-stage activities. We remain on target for first gold in the fourth quarter of calendar 2028. This project hosts a combined mineral resource of 67 million tons at 1.5 g/t for 3.2 million ounces. With that, I'll pass over to Darren.
Thank you, Tim, and good morning, all. For the September quarter, we sold 51,000 oz of gold, comparable to the prior quarter at an average realized price of AUD 6,019 per ounce. The realized price was down 3% on the prior quarter, with 3,750 oz settled on zero-premium collars at AUD 5,906 per ounce. The all-in sustaining cost for the quarter was AUD 2,656 per ounce, slightly higher than the plan, reflecting less Penny ore processed due to weather interruptions, resulting in 4,000 oz of unprocessed high-grade Penny ore at quarter end. The resulting all-in sustaining margin, which is the average realized price less the all-in sustaining cost, was AUD 3,363 per ounce, representing an all-in sustaining margin 56%, which remains sector-leading.
Underlying free cash flow for the quarter was AUD 62 million, after reinvesting AUD 76 million in growth capital and exploration and sustaining capital at AUD 31 million during the quarter. Moving on to slide 10 and the cash flow for the business in the quarter. Starting from an opening cash and gold balance of AUD 649.6 million. The operating cash flow was AUD 186.4 million from gold production of 48,839 oz at an all-in sustaining cost of AUD 2,656 per ounce. This operating cash flow funded growth capital investment for the quarter at AUD 53.5 million, being AUD 52.3 million at Mount Magnet and AUD 1.2 million at Rebecca-Roe. Our investment in exploration and resource definition studies for the quarter totaled AUD 22.7 million. We also paid AUD 3.1 million in working capital and other movements, and prepayments of AUD 13.06 million for FY 2027 income tax. The resulting underlying free cash flow for the quarter was AUD 62.1 million.
Below the line, we spent AUD 17.6 million on share buybacks and treasury shares, which included the AUD 15 million return to shareholders through on-market buybacks. We also paid AUD 131.1 million in Spartan and stamp duty, which is more than offset by the receipt of the AUD 205 million in sales proceeds from the Edna May sale. The resulting closing cash and gold position was AUD 768 million. As you know, we released our four-year plan in September, which sets out our free cash flow outlook over the next four years. As you can see on slide 11, even whilst we are investing back in our business, we continue to generate free cash flow. In FY 2029, we expect between AUD 140 million and AUD 200 million in free cash flow with the focus on the Mount Magnet plant upgrade and early works at Rebecca-Roe.
In FY 2028, as we focus on Rebecca-Roe development, the upgraded Mount Magnet plant will be ramping up to the targeted 4.3 million tonne run rate by December 2027. And throughout this period, we will continue to be cash flow positive and deliver returns to shareholders. And for FY 2030, we will be generating up to almost AUD 1.8 billion in cash flow at current gold prices. In our mine planning, we have a line of sight from FY 2031 to FY 2035. The story even gets better with both growth and sustaining capital reducing significantly. This is why we feel the description of a free cash flow machine is appropriate, and why we believe our forward cash generation screens strongly against our larger caps relative to our valuation. With that, I will now pass it back to Mark.
Thanks, Darren. On slide 12, I am not going to speak to every box on this slide, but just want to emphasize, as I have in the quarterly report, that we are systematically executing and de-risking our business to become a 600,000 oz producer, the highest production growth profile in the sector. We have the balance sheet that can not only fund our development pipeline, invest AUD 100 million into exploration, and execute on our AUD 250 million share buyback program, plus pay a dividend yield that generally outperforms our peers with a track record of doing so consistently. We remain focused on internal growth and shareholder returns. That concludes the presentation. And with that, I will now hand back to you, Darcy, to open the line for questions, please.
Thank you. If you would like to ask a question via the phone, you will need to press the star key followed by the number one on your telephone keypad. If you would like to cancel, please press star two. If you would like to ask a question via the webcast, please type your question into the Ask a Question box and click Submit. Your first question today comes from Jonathan Sharp from JP Morgan. Please go ahead.
Yeah. Hi, Mark and team. Thanks for taking my question. Just first question on costs. So the first quarter was about AUD 136 million in all-in sustaining costs. Just as you ramp up through the year, should we think about the cost base as broadly flat, or are there items that come out, or does it lift slightly with volumes?
I think that one is yours, Darren.
Yeah. As we highlighted in the quarterly report, we are going to be seeing grades come up significantly quarter on quarter, especially at Dalgaranga, but also at Cue. So with that occurring, you will be seeing the cost profile steadily decline quarter on quarter as well as our production comes up quarter on quarter. So, you will not see a significant drop come Q2 and then it flat lines at that level. Every quarter you will be seeing that general decrease in cost, increase in production quarter on quarter with Cue and Dalgaranga being the reason.
Yeah. That is on a unit cost basis.
Yeah.
The absolute dollars?
Yeah. Absolute, yeah.
Pretty consistent.
It's pretty flat. No big increases in any underlying physicals in that context. Just more grade.
Okay, great. That's good. Just a follow-up on that site, admin costs, they almost doubled in absolute terms. Should we just think of that as that's what it will be moving forward?
Let me get into that one. It should be relatively consistent. There might have been some catch up from the June quarter, but let me just be 100% clear on that one. We have got guidance out that we do expect to stay within that, but let me follow up on that one, Jonathan.
Yep, no worries. Just, second question on Never Never. You've said on the call that you're on track for 500,000 tons for the year, which looks like you are. I think previously you said you'd average 6.2 g/t this year. Should we just think about the next three quarters, you're averaging 6.2 g/t ? Or is it over a year? Just wondering how we think about that.
I'll take that one, Jon. Look, in the budget, Q1 was always a lower grade, just where we're mining in the Never Never, essentially. So, the next three quarters, that grade does lift. So yeah, the 6.2 g/t for the year is representative. So, that's just where we were in the mine at that time.
Okay, great. So seems like you'll lift a bit there. Okay, I'll pass it on. Thank you.
Thanks, Jonathan.
Thank you. Your next question comes from Richard Knights from Barrenjoey. Please go ahead.
Hi, gents. Thanks for the call. I just wanted to push you a little bit more on the Never Never volumes. In the release, I think you mentioned 1 million tons since it commenced from the Never Never underground by the end of this financial year. I just want to understand if that is correct. I am just trying to reconcile that with Tim's 500,000 ton number that he just mentioned.
That is the run rate, I think.
Yeah. Richard, yeah, essentially, we want to exit the year at that higher run rate. So yes, we will mine 500,000 tons. We want that to steadily increase during the year. So, we are at that essentially the run rate, by the start of the next financial year quarter.
Right. Okay.
Hopefully that is clear, Richard. Yeah. We will be out there 1 million ton run rates.
Yeah. I think it was worded slightly differently in the release. That is all. No problem. Then you have addressed the grade question, so that is fine. Okay. Thanks very much. That is it.
Thanks, Richard.
Thank you. Once again, if you would like to ask a question, please press star one on your telephone and wait for your name to be announced. Your next question comes from Levi Spry from UBS. Please go ahead.
Yeah. Good day, Mark and team. It is probably the same question. Can we just talk a little bit more about the move ahead at Dalgaranga? So, paste plant, when does it get turned on, how does the ramp up look, and then just this idea of, it looks like you are already at 500,000 tons per annum now, but you are going to finish the year at around 1 million tons. So the grade profile and the tons, just a bit more detail on that maybe, given that is the key value driver.
Okay. There are a few questions there, Levi. So essentially the tonnage is, we are pushing the decline to open up that strike. So, that is the key one that we are pushing there that opens up more headings and gives the ability to keep pushing that mining rate up. As you commented, we have been building that steadily, and we expect that will continue to go along like that. The other one, the paste plant, obviously that is a key part of it as well. So, that has been complete in terms of build now. We are just going through the commissioning phase, running that on surface and then underground. And obviously that is the other key component.
As we open up the strike, more headings and get the paste online, then we will continue to push those volumes up, and the appropriate personnel and equipment coming from Barminco to make that are on track as well, if not already on site.
Okay, thanks. Then maybe just on Rebecca-Roe. So, you confirmed first gold, fourth quarter 2028. Can you just remind us of the critical path items to hit that timeline?
You go, Tim.
Look, essentially, there's probably two components. Obviously, the long lead items in the EPC for the mill. We're just working through the tender documents for that at the moment. The other one is obviously the mining as well. Again, we're working through those documents. That's probably the key critical path areas. In terms of permitting and the like, that's all done. Yeah, it's just basically getting boots on ground now to start that work.
Yeah, just as a broad comment on Rebecca-Roe, we're in really good shape because effectively permitting has come in earlier for Roe than we scheduled, and it gives us a bit more flexibility around optimizing the mining mix between Rebecca and Roe. So we're in really good shape. Obviously have a lot of the project team in place as well, going through the process of appointing a GM and things like that. So we're ahead of the game at Rebecca-Roe in general.
Got it. Okay. Thanks, Mark. Thanks, Tim.
Thanks, Levi.
Thank you. Your next question comes from Adam Baker from Macquarie. Please go ahead.
Hi, Mark and team. Just, firstly on growth CapEx, only AUD 53 million during the quarter. I guess that makes sense. You have only awarded the EPC contract to Primero quite late in the quarter. I guess, when does growth CapEx meaningfully ramp up, for the Mount Magnet expansion over the course of FY 2027? And in addition to that, just noticing Eridanus, not a lot of capital was spent there. Equally, I guess same question, when are we going to get a ramp-up in CapEx at Eridanus? Thank you.
I might answer the last one. So Eridanus, we are essentially mobilizing there at the moment. So November is when we budget to start that material, and we are on track to do that.
Yeah. On the plant upgrade, obviously, as you flagged, we just signed the EPC contract. We will have boots on the ground late November, early December. So the spend will probably really ramp up come January.
Second half.
Yeah.
Yeah. So both of them are really second half-weighted, not surprisingly.
Yeah. That makes sense. Cool. Secondly, I guess, and apologies I missed it if it was earlier on the call, but I guess the wet weather impact between Penny and Mount Magnet, are those roads now restored?
Yeah. They are up and running. Penny, it has got its own weather system there. It tends to get more rain than we do at Mount Magnet, Dalgaranga, for example. It is a longer stretch of road. So yeah, it did knock us out for a lot of September. That is why we had a much larger stockpile. We have actually an internal KPI of having no more than 5,000 tons on the ROM at the mine. So to have [30,000 tons], to sort of give you an insight to the issues. But no, we are back up and running, and we obviously want to be processing all of that material through this quarter, remembering that end of mine plan is also this quarter as well at Penny.
Yeah. Okay, cool. I will hand it on. Thanks, guys.
Thanks, Adam.
Thank you. There are no further phone questions at this time. I will now hand the conference back to Mark to address any webcast questions.
No webcast questions by the looks. Just to wrap up, the final comment, the guys did mention it, our first quarter was solid. But we do look forward to increasing production quarter on quarter going forward with a commensurate reduction in the all-in sustaining cost to go with it. Thank you all for listening in. Enjoy the rest of your day.
That does conclude our conference for today. Thank you for participating. You may now disconnect.