Thank you for standing by and welcome to the St Barbara Business Update Conference Call. All participants are in a listen only mode. There will be a presentation followed by a question- and- answer session. If you wish to ask a question, you will need to press the star key followed by the number one on your telephone keypad. I would now like to hand the conference over to Mr. Timothy Netscher, Chairman. Please go ahead.
Good morning, ladies and gentlemen. Welcome to our call, and thank you for joining us at short notice. I'm Tim Netscher, and as most of you know, I'm the Chairman of St Barbara. We made this call available today to discuss our announcement this morning regarding a change in leadership of the company. Specifically, Craig Jetson has elected to resign as St Barbara Managing Director and CEO, and we're delighted to be able to announce that Dan Lougher will be joining us as our new Managing Director and CEO. I'm joined on the call today by Craig, who I will ask to make some brief comments, and Dan is also on the call and will also shortly make some comments before we open up to questions. We also have on the call fellow board member, Kerry Gleeson, who is Chair of our Remuneration and Nomination Committee.
Firstly, on behalf of the board and the entire company, I'd like to thank Craig for his efforts during his time at St Barbara. Craig has been with us for almost three years, and there is no doubt that together, we managed through some extremely challenging periods through which Craig always displayed remarkable resilience. Before handing over to Craig to say a few words, I will mention just one of the challenges that we have had to deal with. That is that COVID struck in full force just days after Craig commenced in his role at St Barbara. Back then, we were a four-jurisdiction company. Our corporate office was in Melbourne, and most of you will recall that Melbourne was classified as the most locked down city in the world. Fortress WA operated within Fortress Australia, and PNG and Nova Scotia had their own restrictions.
This obviously made it extremely challenging for Craig and his team to visit sites or to interact face-to-face with each other for a very prolonged period of time. In addition, there were the associated challenges of supply chain management and getting unique skills to sites, for specific tasks as they arose. What were previously routine management tasks required a lot of detailed management attention on top of what was normally expected from management. I'd like to now hand over to Craig to say a few words.
Thank you very much, Tim. Appreciate the intro. Look, over the last 2.5-3 years, it's certainly been extremely challenging. With that, I'm certainly proud of some of the things that we were able to achieve in that period of time. For me, now, personally and professionally, it is the right time for both myself, my family and of course, importantly, the business for a change of leadership. I certainly look forward to a break over Christmas, the first time in many years as people would appreciate, over a long career, these sorts of opportunities don't come very often in terms of a clean break over Christmas and New Year to spend time with my family, not only immediate but also extended family.
I certainly look forward to having that break. I'll recharge over that period of time, and I'll resurface next year as my new adventures, whatever they shall take me. I'll follow that road. With that, I guess, man of many words, I'll certainly pass back to Tim at this stage. Thank you everybody for joining this call. It's very much appreciated. Before I hand back to Tim, welcome Dan on board at the same time into the future. Thank you very much, Tim.
Now to Dan, who I'm sure is no stranger to many of you. Dan is quite clearly an outstanding candidate. Over 16 years, he held a number of executive roles at Western Areas, including, for the last 10 years as managing director and CEO. He helped build that company to a point where it became a prized acquisition target for IGO and was ultimately bought for AUD 1.3 billion, a great outcome for Western Areas shareholders. Dan's mining career spans 40-odd years, and he has deep, proven, and very relevant experience for St Barbara. His experience in underground mining alone will be a great asset for our company.
I was a director of Western Areas for almost six years during Dan's tenure of MD and CEO, including that final period of navigating through the twists and turns of the IGO transaction, which in the end delivered outstanding shareholder value. The board agrees that Dan is well-matched to the current phase of St Barbara's journey and that he is exactly the right person to take over the leadership at this time, leveraging off his transaction skills, his strong underground and associated discipline skills, honed both here in WA, in mines very similar to Gwalia, and his experience in operating in international jurisdictions. With that, I'd now like to hand over to Dan to say a few words.
Well, thanks, Tim, and good morning, everyone. Gee, that's a hell of an introduction. Anyway, as most of you know, or maybe some of you don't know, but I left Western Areas and IGO, 'cause I actually was transferred to IGO for a few months, in August and since then, I've been back to Wales, which, if you don't know, Gwalia is actually an old name for Wales. I'm actually coming back to Sons of Gwalia, which is actually where I'm actually from Wales. So it's been four months, actually, and look, as everybody knows, it's you know, when you transition from a CEO, you either go and climb mountains or play golf or I don't know what else you do, but go to wineries.
After four months, I've decided to get back into action. I think that I've got enough energy to see through what is ahead of me. You know, when I was approached, yeah, look, I stepped back a couple of times and, you know, stared it down. Yes, there are challenges for sure, but it's also a big opportunity. St Barbara's got some great assets, and, you know, gold miners all around Western Australia do look at those assets and wonder how they can get their hands on them. My job will be to bring those assets to the fore and deliver the best value that we can do for shareholders. Besides the assets, St Barbara's actually got a good team, both technical, financial, and administrative to support the organization going forward.
As Tim mentioned, Melbourne was, you know, an office back in the day. That office is now fully commissioned and will be stronger in Perth. I do know quite a lot of people. It's a very small industry in the resource industry in Perth. My immediate priorities, as you'd expect, will be to get Gwalia up and running, get it back to business plan. I'm hoping that those underground skills that I've developed over the last 40-odd years, which I don't like to use the word 40 years, makes me think I'm really old. We've got some work to do. We've got to consolidate the plan.
We've got to deliver for shareholders, and, you know, needless to say that has not been the case over the last quarter, few months. Also on top of that, we've also got the Leonora Province Plan, which will give us a platform for growth over many years. Beyond Gwalia, which is consistent amongst any plan that we move forward with, we need to make sure that mine is humming, and we get those ounces out safely and at low costs. Straight off the bat, I will be having conversations with our contractor, Macmahon's, to make sure that we turn the ship around, and I'm sure that we can do that in a very safe and good way. St Barbara has the largest mineral resource and ore reserves in the region, with near-term growth from several good projects.
That's the attraction for me, is that I am an operator from, sort of, when I came through the ranks, and I understand what shareholders need, and I'll be working hard on that Leonora plan. Obviously, there are other assets in the group. The Atlantic Gold, which is currently needing permitting, and I will make sure that every effort is done to make sure those permits come through. We've had some delays, obviously, for the COVID period, which has obviously, you know, been difficult for every resource company in Australia. Of course, the other project, Simberi in Papua New Guinea, we will continue that strategic review to ensure best outcomes for our shareholders. In a nutshell, I'm very pleased to join St Barbara.
Obviously, Tim and I have got a bit of background. You know, I'm sure that we will work together for the greater good. I've only just met Craig, so I'm sorry that you're leaving, Craig. I will probably ask lots of questions in the next two weeks or three weeks, and I thank you very much for handing over a company, which, by the way, is not in a bad shape. Gold is on the up. You know, I don't like to dwell on the past. I can only look forward to the future and make sure that everybody at St Barbara knows where we're going, how we're gonna get there, and that everybody pitches into that plan. With that, I say thank you very much for this morning and over to Tim.
Thanks very much, Dan, and thanks for that very comprehensive introduction. You've obviously come up to speed really rapidly in literally just a day or two. Great to have you on board and
I like your line of, let's leave the past behind us and let's focus on the future. I think that's absolutely essential in our company going forward. Operator, are there any questions on the line?
Thank you. Your first question comes from Andrew Bowler with Macquarie. Please go ahead.
Good day, Tim, Craig, and Dan. Good to hear your voice again, Dan. I think you've actually already answered my question. I was just gonna ask about, you know, the continuation of the strategic review process for Simberi or, you know, potentially could you slow that down and have another reassessment of it, or it sounds like you're just gonna go ahead with it.
Yeah. Look, yeah. Thanks, mate. It's been a bit while since we chatted. Look, let me get my bloody feet under the table and, you know, firstly have a good look at exactly what the, you know, what's happening at Simberi. I mean, you know, there's a sulfide project coming potentially ahead of us. Look, there's a review on foot, so I'll probably just get up to speed with that and take you know take it from there probably. As I said, you know, nothing needs to be changed dramatically in the first 24 hours. That's probably where I'm gonna go.
No worries. That's the only question I had. Thanks, guys.
Thanks, mate.
Thank-thanks.
Thank you. Once again, if you wish to ask a question, please press star one on your telephone and wait for your name to be announced. Your next question comes from Alex Barclay with RBC. Please go ahead.
Thanks. Hi, everyone. I guess firstly, congratulations, Dan, and also to you, Craig, for what you've achieved in obviously very difficult circumstances. A couple of questions for you, Dan. Just firstly, obviously you've come on board with ambitions for the direction of the company and all the various assets, but I guess there's the talk around consolidation in that Leonora region, which might, you know, shorten the existence of St Barbara in its current form. How's that potential upcoming corporate activity influenced your decision to come on board?
Well, as I said, you know, I mean, I'm an operator, so my role, as with any CEO MD coming into a corporate landscape, is you deal with what's ahead of you right now. Through my career, I think I've had about, you know, 25 deals pitched to me and only one of them actually happened and I got kicked out and put into pasture. My job will be to make sure that what we have on the table today, and mainly, you know, the cash flow generator within this company is Gwalia. That's where the focus will be. Look, I mean, you know, as I said earlier on, the best thing that we can do as a region is consolidate if that's the best outcome for shareholders.
You know, the landscape, there's quite a few players in that area. We've already consolidated Bardoc back end of last year. Genesis is obviously, you know, making moves at Edna May, and there's a few other groups around that area. The question would be is, you know, what's best for St Barbara shareholders in the longer-term picture, and how do we best bring those assets to play? If that means that I'll go back to pasture again and another trip to Wales, you know, hey, there's. I've been sadder, you know, worse things have happened to me. Look, let's not, you know, let's get one thing clear here that my job as MD on the board is to make sure that our board with Tim delivers the best shareholder returns, and we need to make that.
Currently, Gwalia needs to make money and produce gold ounces. That's currently my main focus will be. I won't be, you know, not getting involved with the other bits and pieces if that's what's required for me, through the board.
Yep. You talked about, you know, lifting the mining contractor performance, and it does seem to have been a bit of an issue at Gwalia. It might be a little bit too early for you to say, but do you know exactly what sort of changes could be made there to see improvements?
Yeah, look, I mean, I'd have to say that, you know, just recently left an active three mine operation with a mining contractor. You know, at the end of the day, everybody suffered. I don't think anybody, not one mining company can stand up and say that the pandemic and shortages of skilled and unskilled, you know, workforce has not had an impact on the bottom line. If they did, they'd be lying, unless it's BHP or Rio, of course. The bottom line for me is that I need to get, you know, up to site, which will happen probably the week of the 28th, and I will sit with the new general manager there, and we will talk with Macmahon, because in my books, the only way to make a mine hum is to have everybody.
There's no contractor versus, you know, the owners. It's a one team effort, and everybody needs to buy into that to deliver the final numbers. If there's, you know, there will be some changes, maybe, you know, look at equipment requirements. It's a deep mine. Ventilation is quite critical. We need to do our part, and I'm pretty sure that in conversation with Macmahon, we'll get to a good solution where we can actually forge forward with, you know, getting our daily, monthly, quarterly results. It's a bit early for me to-
Yeah, sure. That's great.
Yeah, it's a bit early for me to say, you know, you know, I've got 25 jumbos or blah, blah. You know what I mean? Yeah, no problem. Last question for me, for Tim, just on the recruitment process about finding the replacement CEO. Exactly how did that process run? It sounds like it was a fairly sort of speedy thing.
Before I answer that, Alex, I'll just mention that, you know, Dan said he's been around for 40 years. I've been around for another 10 years more than that. What I've learned over my career is that, your contractor, whether it be an EPC contractor building a processing plant like Gruyere at Gold Road or whether it be your mining contractor, are as good as you manage them. Dan knows that really well. Managing doesn't mean, as he says, does not mean us and them. It means managing them to common goals. I'm confident that Dan, you know, has all those skills to do that and will be having an impact, really shortly, in that regard.
With respect to the recruitment process, we, as a board, one of our primary duties is to do succession planning, particularly for the MD and CEO. We have a process where we identify potential replacement candidates all the time. That extends beyond internal candidates. It extends to potential external candidates as well. Dan was in that group of potential external candidates. When it became apparent that Craig was considering resigning, you know, Craig and I have a good relationship, and he mentioned that he was considering resigning a couple of weeks ago and then actually did resign just a day or two ago.
That enabled us to, you know, to go through that list of candidates, and the top of the list was Dan. We commenced early discussions with him, and then eventually it culminated in Dan joining us when Craig indicated that he definitely was resigning. It's as simple as that.
Yep. Okay. Thanks very much, guys. Enjoy the break, Craig.
Thank you very much, Alex.
Thanks, Alex. Any other questions, operator?
Your final question comes from Peter O'Connor with Shaw and Partners. Please go ahead.
Thanks, Tim, Dan, and Craig. Craig, best wishes for the future. Dan, welcome back again. Good to chat with you. Tim, to the replacement process, and just to your further to your last question, was it a competitive process? Your last answer, it sounded like Dan was handy. He was there. He's a great candidate. Was it competitive?
Competitive on a desktop basis, Peter. We, you know, it was actually pretty easy to narrow in on Dan as the best candidate. The other thing to be clear here is that this is quite a unique role that we had to recruit for. As we've just been discussing on this call, it's we may end up in a corporate activity quite soon. We may not. We don't know. That's common knowledge in the market. This is all about, as Dan said, achieving best shareholder value for the Leonora Province. You're actually recruiting somebody for something that may be X or maybe Y.
Under those circumstances, gee, it's really a good outcome to have landed someone with Dan's quality in those circumstances.
Okay. Dan, can I ask you, in your discussions over the last, what sounds like several weeks with both Tim and the board and maybe recruiters and other executives, what do you understand the investment proposition of St Barbara to be? I know you've talked about what you want to do, but what is the investment proposition of the company?
Well, look, I mean, you know, firstly, I think gold is going to go back into a more sort of growth period. You know, we all understand that the last sort of six months has been a little bit in the doldrums. Look, the investment thesis here is that there's a lot of reserves, resource and reserves which have yet to be brought, I guess, into a structured plan where, you know, we can grow the ounce portfolio. I mean, you know, as Tim mentioned, this, I guess, you know, noise from people wanting to do a deal with us in the Leonora Province, that's not a secret why that is because we've actually got a lot of stuff that people want.
The growth and the attractiveness from an investment portfolio is that we will demonstrate that we can, you know, Gwalia is a, you know, a deeper mine and needs a bit of encouragement, but that'll happen. Then there are some great other projects that are ready to, you know, one of them is already, so we could start the decline there tomorrow. The rest, you know, we will build a plan around the, you know, any additional resources that we think can come into play. Obviously, Craig has talked, you know, things like mill expansions, et cetera. We need to take it bit by bit. The bottom line is that we will turn things around and get Gwalia, you know, ticking as it should do.
It's a great resource, and a great mine. There are some very good assets surrounding that which we will now look at when, you know, in good circumstances, we can actually develop those assets. Then looking into, you know, Nova Scotia with, our operations there, which are, you know, just ticking over, you know, on low grade. We need to get those permits up and running so we can get the next generation of mines in that area through the mill. I have to structure that, you know, in terms of a good sort of logic to the market, and that's probably something that we'll be working hard on in the next couple of months. I can't tell you right now, Peter.
I'm just kind of gardening. The tomatoes are looking good. Yeah, look, there's a lot of gold, and we just have to turn those into workable assets. That's where there's a good growth story, and that's what attracted me to the company.
Okay. Can I just switch back to Simberi, your first answer to the first question? Can you give us an update today on this call, either Tim or Craig or yourself, about what is the status of that process? Not just the strategic review, but the sale process. Where are we at with non-binding bids, non-binding indicative bids? Is there a data process? Where are we at?
I can't answer that, but I think Tim or Craig.
Sure. Yes. Look, we can't comment on, you know, confidential discussions. Yes, there's been a data room open there for a month or two. As you're probably aware, Peter, in the middle of that process, there was a very handy extension of the oxide ore announced, which actually has changed the picture, so we had to update the data room. We still have a number of parties in the data room. In terms of having any non-binding offers, I won't comment on that. The process is still underway.
There's been site visits and good discussions, but I won't comment any further than that.
Okay. Tim , I've also got you. You've got to swing back to the Leonora province. With Dan starting as new MD, just feet under the table, he's jumped up at Gwalia, deep in the mine, trying to sort things out. Raleigh calls tomorrow. Who takes the call and who progresses the discussions? Do you do that, Timothy does the board or does Dan?
If Raleigh calls tomorrow, in the first instance, Dan will take it. I'm sure he'll consult with the board in short order, and obviously we'll then come up with the right collective response.
Okay. Thanks, Dan.
Dan's the CEO, so he'll be the first port of call.
Okay. Thanks, mate. Thank you.
Thank you. There are no further questions at this time. I'll now hand back to Mr. Netscher for closing remarks.
Okay. Thanks, Melanie. Thanks to all participants on the call. Thanks for joining at short notice. That brings the call to an end, and I wish you all a good and productive day going forward. Thank you very much.
That does conclude our conference for today. Thank you for participating. You may now disconnect.