Northern Star Resources Limited

Thank you for standing by. Welcome to the Northern Star June 2024 quarterly results. 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. Stuart Tonkin, Managing Director and CEO. Please go ahead.

Good morning and thanks for joining us. With me today is our Chief Operating Officer, Simon Jessop, and Chief Financial Officer, Ryan Gerner. I'm pleased to present an exceptional June quarter performance to close out FY24. With Thunderbox and Pogo, we were both highlights, achieving record performances complemented by continued strong performance from the portfolio. In FY24, our team delivered record gold sold and record net mine cash flow. This demonstrates the quality of the asset portfolio across our three production centres and also the value our investment is making to unlock future low-cost, high-margin ounces. I'm particularly proud of our people who safely delivered on our FY24 commitments. Thank you for all your efforts which are continuing in FY25 as we advance our profitable growth strategy. For the June quarter, we sold 439,000 ounces at an all-in-sustaining cost of Australian dollars $1,815 an ounce, generating underlying free cash flow of $189 million, which is up 32% from the March quarter. And for the year, we generated underlying free cash flow of $462 million, up 29% from last year. As you can see in our results, Thunderbox and Pogo stand out this quarter for record mill throughput and in turn gold ounces. Each of our production centres remain in a positive net mine cash flow position, ensuring they are self-funding the growth. As a group, we remain financially resilient in a net cash position of $359 million. This financial strength allows us to fund all our growth investments, exploration activities and capital management initiatives, including dividends and share buybacks, as demonstrated during FY24. For the KCGM mill expansion, onsite construction is advancing to budget and schedule. It is exciting to see this activity underway at KCGM, which will double the plant's throughput to 27 million tonnes per annum and lift production to 900,000 ounces per annum by FY29. Investors and analysts will have the opportunity next Sunday to visit KCGM and see firsthand the significant progress made prior to the Diggers and Dealers Conference. We have today also provided FY25 guidance. We expect to produce 1.65 to 1.8 million ounces of gold at an all-in-sustaining cost of Australian dollars, $1,850 to $2,100 an ounce, into a very healthy gold price environment, currently around $3,500 an ounce. As per previous years, planned major shutdowns will be carried out across all three production centres in the September quarter, so FY25 delivery is second-hard-weighted. We are majority of the way through our five-year profitable growth strategy, which sees our production grow to 2 million ounces by FY26, and more importantly, enables the delivery of higher free cashflow levels. Three years into our growth investment, we have delivered $1.3 billion of free cashflow, which confirms our rationale for the value creating strategy. We forecast FY25 capital expenditure to be in the range of 950 million to 1 billion and 20 million plus the KCGM mill expansion capex of $500 to $530 million, which is in the second year of its build phase. Before I hand over to Simon for the Australian operations, Hygo in Alaska delivered an exceptional quarter, a record of gold sold at 91,000 ounces at an only sustaining cost of US dollars $1,091 an ounce. which delivered record mine operating cash flow of US $107 million and record net mine cash flow since being under Northern Stars ownership. This is a testament to the team and the asset strength, also delivering a record annual gold sold of 278,000 ounces at top of guidance range. I remind listeners that Pogo boasts a gold resource of nearly 7 million ounces at above 10 grams per tonne. highlighting that we will be generating strong USD cash flow for the next decade plus. A fantastic achievement and well done to Team Pogo. Simon will now speak to the Australian operations.

Thank you, Stu. For the Kalgoorlie Production Centre, including Casey Gem, Karasu Dam, Kanana Bell and South Kalgoorlie, we sold 221,000 ounces of gold, down 2% at an Australian all-in-sustaining cost of $1,712 an ounce. This production delivered a mine operating cash flow of $335 million, up 10% quarter on quarter. The region also spent $264 million on significant growth capital projects. This included $101 million on the Casey Gem Mill expansion, $52 million on the Casey Gem Open Pit mine development, and $24 million on underground mine development. We also have successfully started to commission the new tail storage cells of E and F at KCGM, which have a 147 million tonne total capacity. At the KCGM open pit, material movement was 16.6 million tonnes. As we prioritise the partial access mining of Golden Pike North with a further 43,000 ounces mined in the quarter. The east wall cutback works continued, along with Arroyo Brownhill and Fimson South. For the full year, we mined 72 million tonnes of ore and waste as the open pit team continued to manage competing priorities. We remain on track to regain full access to Golden Pike North in the quarter two of FY25. Underground mining volumes for the Kalgoorlie region increased 3% to 1.55 million tonnes with grade up 12% to 2.8 grams and delivered 143,000 ounces. The higher grade was driven from Kalgoorlie operations South Kalgoorlie mine and Karasu Dam mine sequence. KCGEM's underground operations increased development a further 11% quarter on quarter to 4.2 kilometres. The development metres will continue to ramp up quarter on quarter going forward with the arrival of two new jumbo fleets at the end of the financial year. The Karasu Dam underground mines all perform well with 54,000 ounces mined in the quarter. Open pit movements increased 16% to 1.3 million BCMs despite consistent rain impacting these positive results. The Kalgoorlie Operation underground mines increased mined ore volumes and grade, which increased 36%, driven by South Kalgoorlie's mine averaging 5.4 grams a tonne, over 37,000 ounces for the quarter. Processing volumes in the Kalgoorlie Production Centre increased 13% quarter on quarter, as Casey Gem had a smaller planned shutdown, along with good milling performance at Karasu Dam. Casey Gem's head grade reduced with less high-grade ore available from Golden Pike North, which was offset with lower-grade stockpiled ore. Casey Gem recovery was impacted due to a float circuit and Gigi losses, with both being addressed in the first quarter shutdown of FY25. Karasu Dam processing finished with a new annual record of 3.9 million tonnes processed in the year, which is a major credit to the team. The Casey Gem Mill expansion spent $101 million over the quarter, with total engineering progress at 44%, and the major equipment package also at 42% complete. The concrete poured at the end of June was 9%, while as of today, as we're sitting here, it's 18% poured, with the largest single pour of 1,600 cubes completed early in July for the ball mill raft. We are very pleased with the on-ground construction activities and we look forward to showing the progress of the Casey Gem Mill expansion project as part of our upcoming Casey Gem site tour. The project remains on time and tracking to plan. At our Yandall production centre, including Jundee and Thunderbox, we sold 127,000 ounces of gold at an Australian all-in sustaining cost of $2,109 an ounce. This production delivered a mine operating cash flow of $155 million, while we spent $81 million on growth capital projects, primarily at the Aurelia open pit and Wanda underground. At our Jundi operation, development advance was set 7.6 kilometres up 10% quarter on quarter, with 796,000 tonne of ore mined and 88,000 ounces up 20% quarter on quarter. Processing was lower than nameplate due to a fixed plant fire which impacted the gold room and back of the processing plant, requiring a large amount of electrical rectification works. By quarter end, the impacts of the May fire were rectified with a large build-up in gold in circuit, with lower gold sales due to the reduced milk tonnes. Jundee's renewable project of a 16-megawatt solar farm and 12-megawatt battery system is currently in its final commissioning phases, with partial renewable power now being successfully exported into the grid. We also have one of the four wind turbines erected as the crane moves through the program before commissioning of that stage begins. The Thunderbox underground mines, including Thunderbox and Wonder, achieved 650 13,000 tonne of ore for 35,000 ounces at a head growth of 1.8 grams per tonne. The Wonder Underground mine continued to ramp up ahead of plan with 1,508 metres developed with one jumbo over the quarter. It's a credit to the Northern Star Mining Services team who are building this mine with the Thunderbox technical team ahead of plan, below cost, which ultimately brings high-grade ore feed earlier to the Thunderbox mill. For the quarter, the underground and open pit operation successfully mined 1.5 million tonnes of ore, which is at the expanded mill's quarterly nameplate. At the Thunderbox process plant, we achieved nameplate on a quarterly average of 1.5 million tonnes milled. and sold 63,000 ounces of gold, up 40% quarter on quarter. The mill throughput averaged an impressive 795 tonnes per hour for the quarter. Availability was also a new quarterly record of 85%, with a significant shutdown occurring in April in those numbers. For the first full financial year of processing, we achieved 87% of the nameplate throughput, We are continuing to work on availability in the crushing circuit and milling stability by rectifying known wear points. The last quarter is a great result for the Thunderbox team who continue to unlock the full value of this major plant expansion. I would now like to pass over to Ryan, our Chief Financial Officer, to discuss the financials.

Thanks, Simon. Good morning, everyone. As demonstrated in today's results, the company is in a strong financial position. After an excellent quarter, we've increased our net cash position to $359 million and increased our cash and bullion to $1.25 billion. The company has generated record full-year cash earnings of approximately $1.8 billion, and as forecasted, we've delivered a material uplift in the second half, driven by higher production, lower unit costs across the business and higher gold prices. A reminder that the company's policy is to pay 20% to 30% of cash earnings in dividends. Figure 9 on page 11 presents the cash, bullion and investments movement for the quarter. Key highlights being operating cash flow of $688 million, a 31% lift on the prior quarter and underlying free cash generation of $189 million. bringing FY24 underlying free cash flow to $462 million, up 29% from prior year. Importantly, all production centres are delivering strong net mine cash flows, which totaled $686 million for the full year. As Stu mentioned, Pogo, an absolute standout, delivering a record contribution of $238 million for FY24. Growth capital investment during the quarter related to key growth projects, including at KCGM, Thinneson South Cutback and East Wall Remediation Works, development at Palfrey Underground and Walbrook Open Pit at CDO, development at Aurelia Open Pit, Wonder Underground and Remediation Works at Thunderbox Processing Plant, and approximately $100 million for the KCGM plant expansion was incurred during the quarter. Total spend for FY24, on the project was approximately $350 million. The reduced spend related to the timing of some procurement packages being finalised. But importantly, this is not expected to impact critical milestones, schedule or budget. On other financial matters, full year depreciation and amortisation of $703 per ounce is in line with guidance of $650 to $750 per ounce. And non-cash inventory charges totaled $34 million with the majority of these charges relating to the milling of stockpiles at KCGM. As part of the company's ongoing capital management program, the on-market share buyback continued during the quarter. 305,000 shares, totaling $4 million, was bought back and cancelled. Since the program started, 19.5 million shares have been purchased at an average price of $8.85 per share. 128 million... Dollars remained outstanding with the program open until September this year, a reminder that blackout for our suppliers until our FY24 results are released in August. Following the delivery of a strong Q4, the company is well placed to deliver FY25 production and cost guidance. Sustaining capital expenditure is forecast to remain within our current range of $200 to $250 per ounce sold. FY25 growth capital, excluding the KCGM expansion project, is guided at a midpoint of $985 million. This investment is centred on our returns-focused organic growth options. At the Kalgoorlie Production Hub, the majority of the investment is allocated to projects which will deliver the mill feed and infrastructure for the KCGM plant expansion. These projects include development and ramp-up of Mount Charlotte and Phimiston underground mines open pit material movement and infrastructure requirements. At Yandal, the majority of the capital investment includes advancing the existing Thunderbox mill feed sources at the high-grade Wonder Underground, Aurelia, and development of the Bannockburn open pit. At Jundee, mine development will commence at Cook Griffin, a recent exploration success, and continue at the main Jundee ore body with additional infrastructure planned. And at POGO, mine development and resource drilling are an ongoing capital requirement to open new mining areas and increase the number of available headings. In early FY25, major infrastructure works will be undertaken to maximise utilisation and availability of the plant, including rebuilding the ball mill motor and replacing the trunnion. The milestones in FY25 for the KCGEM expansion project include delivery and installation of major equipment, as well as commissioning of service infrastructure. We are guiding FY25 spend to be $500 to $530 million for the project. FY25 exploration is guided to $180 million, with investment focused on KCGEM and Jundi in mine exploration, and at POGO additional drilling at the Star discovery is planned. Importantly, with the company's strong liquidity position of $2.7 billion, our profitable organic pipeline and exploration activity is fully funded. Finally, in respect of hedging, Table 5, page 11 sets out the company's committed hedge position at 30 June. The overall hedge book stands at 1.8 million ounces at an average price of $3,122 per ounce. I'll pass back now to the moderator for Q&A. Thanks very much.

Thank you. If you wish to ask a question, please press star 1 on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star 2. If you're on a speakerphone, please pick up the handset to ask your question. Your first question comes from Mitch Ryan with Jefferies. Please go ahead.

Morning, Stu and team. My first question just relates to you've reiterated 2 million ounces of production in FY26. How should we think about this? Is that sort of the lower band of a guidance range, or is this more of a midpoint, or is it a stretch target for your FY26?

Thanks, Mitch. Yeah, look, I guess what we've published today is the FY25 guidance outlook, and I'd reiterate that's a checkpoint on our growth pathway to 2 million ounces by FY26, and then that is followed by the expanded Phimiston plan adding 250,000 ounces per annum through FY27 to FY29. So, yeah, it's another growth year, FY25, and the commitment, as we've held in our five-year strategy, is to grow to that profitable 2 million ounces in FY26, and we're the majority way through that plan, and a lot of those actions have been delivered. So you're very pleased with how we're tracking. It's not a straight line. I'll remind people about our planned shutdowns. We occur in quarter one, so it's second-half weighted, and quarter one will be the softer quarter of the year. So, yeah, it's not a straight line, but we're still on our growth trajectory and it's working well in cash generation.

Okay, so 2 million ounces is a target of... That's FY26, Mitch.

FY26, I haven't given guidance for FY26, but that is our five-year strategic plan to deliver 2 million ounces from the three assets in FY26. So what we've got today is the checkpoint in FY25, which is 1.65 to 1.8 million ounces.

Yes. Okay. So it's not an exit rate. It is a production number for the full FY26.

Yes, and the final last piece, really, for that to be delivered is the grade coming from the Golden Pike to lift KCGM from 450 to 650,000 ounces per annum. complemented by the other assets being in a steady state. So I go at 300, Yandel at 600, and obviously the balance being Gargouli, but KCGM's the major step change in that last year, and Simon's updated on the progress of access of the east wall remediation, plus the access to that high-grade and de-stacking those benches in the better-graded gold pipe.

OK, perfect. Thank you very much. Appreciate the clarification. My second question just relates around... Again, you've called out that September quarter, the shuts, and that'll be the weakest quarter. The quantum sort of sometimes it's down around sort of somewhere between 7% to 15% on the June quarter. Is that sort of a fair range, or can you give us any quantum of the quantum of those shots?

Yeah, metal maths is good. That's about right. So if you look at our quarter one last year, that was our lightest quarter. That was sub 400. I think what we'll call out in this is Pogo's Mill... essentially is off for five weeks at a de-rated throughput, and that's to do substantial project work, which has commenced and is tracking well at Pogo presently. So Pogo is probably the lightest site's performance, coming off a strong 91,000 ounces. It steps right back down with five weeks out of the quarter. And then those other planned major shuts across Yandel and Cal occur as well. So The full year, the run rate of the last three quarters is a very good indication to give us confidence as to how we pull into FY26. And most of that, you know, expectation step back is around the impacts of quarter three. It is planned work, well-run work. We're always asked to design it differently, but this is how the overall plan has played out each year. And the strong quarter four was delivered. We're not falling off a cliff in quarter three. It is planned work in this first quarter. But it's just the work that has to be done that secures these assets over the years ahead. Perfect. I appreciate it. I'll pass it on. Thank you. Thanks, Mish.

The next question comes from Kate McCutcheon with City. Please go ahead.

Hi. Good morning, Steve. Just at the super pit, you've given some material movement guidance previously, and I think 24 was supposed to be that peak of 85 to 95 million tonnes. But it looks like that came in short. Can you just talk to what the stripping looks like this year and next year, and then what portion of the stripping is that guidance chunk for KCGM this year?

Yeah, thanks.

I'll let Simon answer. Yeah, thanks, Kate. We'll have a look to give a good update on the KCGM movements and where we are at the site visit in a couple of weeks' time. So we'll look to, as we've guided previously on strip ratios and things like that, we'll look at that on the site visit just before diggers. But in terms of the overall year, quarter three was particularly hard with rain, significant rain throughout the quarter. So what we did was just prioritise where we worked during the pit during that quarter. So we dropped away some material movement, which we can catch back up in the and really prioritise on the high-value OVH areas and the east wall remediation because that's the biggest driver of value. And you also saw us accessing Golden Pike North, partial access to it, slightly ahead of plan. So we brought some of that forward, which is obviously longer haul distances forward. for the trucking fleet. So not concerned at all. We've still got 80 to 90 million tonne, and that's where we'll consistently sit moving forward.

Okay, got it. And then staying on CAPEX, so I guess it's hard on our end visibility on modelling this continued CapEx to open up some of these all sources at Yandle, for example. So I think there's an extra 50 million this year opening up some of those pits. And you've given us some colour for Thunderbox in your slide decks. How do we think about this CapEx going forward? I know we've just got 25 guidance today, but does it step back next year? Or what sort of colour can you give around when additional pits need to come in? I mean, opening up Cook Griffin, for example, unless I missed it. wasn't really on my radar as capex that had to be spent this year. So just sort of, if you can talk through some of those mining areas that come in.

Yeah, thanks, Kate. And I'd agree that it doesn't have to happen. We are trying to always build contingency... into the plan such that we can deliver consistent guidance over the forward outlook so when we can bring it through approvals and accelerate and we have the cash flow to do that we do bring those projects online so that we've got those diversification of production centres etc so we can manage through weather events or approval timeline slipping or other things. So, yeah, Cook Griffin, great opportunity. You know, we're starting that underground with their normal start mining services. We did a very similar thing last year, obviously, with Wanda, starting it early, you know, I guess out of the timing. And then probably the other capex lift is the TSF down at Kalgoorlie coming in early because of the expanded mill plant. These things are in our life of asset plan. They're all scheduled and sequenced. But ideally what we want to do is de-risk. So when the cash flow is there, the budget's there, we've got sequence and priorities, but we will bring these things in early. We're happy to, it's not an oversupply, but certainly de-risk it, develop it, build stockpiles near to our mills so that on any given day we have that blend of all that we can send in. So I acknowledge that the CAPEX has stepped up from consensus in FY25. I also believe directionally, you know, gets over this hump and we've de-risked and built golden stockpiles and golden circuits. I think it sits now over three and a half million ounces, which is a good thing for investors. It's security of forward earnings, of security of material close to our plants. And we always try to stay ahead of that investment. It is also, I want to say, discretionary. If things change in the environment, we can actually dial back some of this investment. But in this environment, we're going as hard as fast as we can to build that contingency in. So I know you're looking for the returns on the back of it. I'd be confident that we're looking at it through a returns lens and we're seeing multi-digit IRRs and our decisions around these things is improving our margins and improving our overall returns. That's the lens we look at these organic investments through. And that's versus a question that will probably come up on the call around M&A, our organic opportunities, Trump, every other thing we've been looking at, that this is our business, this is our work, and this is what complements shareholder returns.

Okay, that's helpful. Thank you, Stuart and Simon.

Thanks, Kate.

The next question comes from Levi Spry with UBS. Please go ahead.

G'day, Stu and team. Two questions, please. Firstly, just on Thunderbox, sorry I'm catching up here with a few colleagues all at once. Can you just sort of run us through why it was so good? It seems like things are back on track. Maybe just a bit of detail around that, please, Simon.

Yeah, thanks, Lilo. During the quarter, really, we just focused on that availability and, you know, really lifting the crushing circuit availability to get stability into the process plant and the milling. And you saw that with the 795 tonne per hour average for the quarter. So name plate, 750 tonne per hour. So we saw even in June, sprint capacity of the whole June averaged 820 tonne per hour. So we're continuing to work on the availability. We still believe there's 5% or 6% more availability to eke out of that infrastructure. We know what the areas of focus are, so it's known where points, but really pleased with the team in terms of just constantly working through areas that fail, and then putting long-term rectification fixes in place. So it was a big year for the team, but really pleased to get 1.5 million tonnes for quarter four and start FY25 in a strong position from a process plant perspective.

Yeah, nice one. Thank you. Thanks, Simon. And maybe just on the capital question, just extending some of those good questions there previously, how can you help us in the sort of three- to five-year timeframe, Stu?

Look, we don't guide out that far, but what I'll say is, you know, growth capex gets you growth. So, you know, FY26, that 2 million ounces, you've got visibility of the capital to deliver capital So we're in the second year this year, you know, $530 million being spent this year. So, you know, you've got the tail of that capex going into 26 and then a slight piece in 27 on Fimmerston, so another $500 million, 26 there. But the remainder to keep that 2 million ounce profile across those assets is sort of an open pit or an underground being turned on each year. And then, you know, TSF lifts that are multi-year lifts. So whether it's dollars in a year that get, you know, amortised over the future life asset types of things. So I would also say we're seeing a huge amount of opportunity. So, like, we're going to up our exploration expenditure, you know, 180 to 200 million this year. You know, if that liberates things like, you know, the Hercules discovery, just, you know, less than 20 k's from Phimiston plant, you'll get capital in a hurry to develop that into a mine and get that gold into the mill. So there's still, I guess for analyst investors, it's hard to say, well, you haven't got visibility out five years and talking about things we never heard about. We're still discovering things like Hercules this year that I will prioritise and fast track and it will attract capital, but it will attract superior returns. because of the success of the exploration team. So to bear with us a bit that, you know, there is a sustaining capital to maintain at 200, sorry, 2 million ounces per annum. And typically it's, you know, we're a year ahead. Our capital is a year ahead of when the production comes in. We'll build a stockpile, develop a mine, build a stockpile next to a mill and then the ounces will come the year after. And that's the thing. But, you know, this is still a very heavy lifting capital year, FY25, as we acknowledge.

Yeah, thank you. Thanks, Stuart. And maybe just sneak one in on ASIC. So how do we think about that in the context of the volume growth?

Yeah, so look, again, we've given ASIC at $1850 to $2100, and that's considering where the gold price is and the cost that it attracts and the behaviours that it drives. I'm also thinking with the backdrop of the nickel reduction, lithium reduction, you know, even some gas out of iron, there's potentially some costs plateauing or even potentially some retraction savings, you know, across energy, across labour. So we haven't baked that into anything across our costs on dollar millions. And then, as you pointed out, economies of scale or denominator of gold sold, you know, just as a see-through on POGO, it delivered in the quarter ASIC at $1,090 US dollars an ounce. So you've got, you know, over 100% to ASIC margin of the US price to ASIC. And then on $1 million, it's still sitting at over $30 million per month US. And I sort of spoke about, you know, I've still got the new trucking fleet to be brought in to take from sort of 10 trucks to six trucks and drop labour and drop, you know, maintenance costs around that fleet So there's some improvements we are seeing to make true step-down changes. And then as we've reduced stripping ratios across the business and get into the primary aura of these pits, we're also seeing some benefit there. But I've maybe been conservative in dragging costs right. When we look across the consensus peer group, we're probably seeing the same trend and expecting You know, staying still is a good thing in this environment. We'll still migrate down the cost curve, but we get to see most people's reporting on ASIC.

Okay. Thank you. Appreciate your time. Thank you. Thanks, Llewellyn.

Your next question comes from Daniel Morgan with Baron Joey. Please go ahead.

Hi, Stu and Tim. My question just relates to the POGO situation. the outage or the mill maintenance period that you're doing in, well, I guess, as we speak. What impact does that have on accommodation? I'm just thinking through, you know, once you get it complete, you know, will accommodation constraints mean that development rates and, you know, mining rates, you know, suffer a little bit as a hangover or consequence? Thank you.

Oh, thanks, Dan. So, There's a few things that happen throughout the year to be able to disconnect activities because we're very handsome out there. So a lot of the great work team's done to be able to, you know, when the mill's off to not stop mining where it used to sort of back up within a day or two. So obviously the oil passes in this season, you know, surface temporary stockpiles can be built. prioritising of waste development and grade. But, you know, last quarter we averaged over 1,600 metres a month, so we're ahead on the development rates and a lot of good work is going into doing that. So I don't see any mining impacts throughout the five weeks. That means that we're behind the game. In fact, we'll build contingency up to be ready to turn it on well. And we're also running on a sag-only case at about 30%, 35% of the general throughput, which is good for gold production, but it's better that you're keeping all the rest of the plant running so that it's not sitting idle and, yeah, so just keeping it all moving and keep the team applied in that period. So that's all useful. And then the major project work that's underway right now, future proofs the asset. So that motor that failed back in February last year, we have obviously put, A full rewind goes into that motor and have a replicate spare. Then a lot of work on the ball mill and all of Project West around coarse ore bins, fine ore bins to make sure that these things don't trip us up throughout the year for the remain part. So, yeah, accommodation and all that sort of stuff, the construction crew, they're all there. They'll all be, you know, closed out and done and gone in four weeks and then back on, going back on. So, yeah, pretty impressive outcome. I just can't highlight enough. 91,000 ounces at 1090 ASIC US an ounce, 107 million US dollars. Reminding people we paid 260 million US for this asset five years ago and we're sitting there with multi-decade outlook. So it's a fantastic asset. So it's worth investing in.

No, thank you very much for your perspectives.

The next question comes from Matthew Friedman with MST Financial. Please go ahead.

Sure, thanks. Morning, Stu and team. Can I just carry on from Levi's questions on the all-in sustaining cost base of the business? And I guess really, really thinking about things more in dollar million terms, you've spent about $3 billion on all-in sustaining costs in FY24. Your guidance implies that's going to lift to about $3.4 billion in FY25, so about a 15% increase. Can you just talk through what, I guess, the kind of high-level drivers across the business are that are driving that increase? You mentioned, you know, labour costs, energy, consumables, all of those things have gone up and potentially there's some conservatism in your guidance around those. But to my mind, that doesn't really drive a 15% increase to the sustaining cost base. My interpretation is that it's more driven by... I guess, increased material movements across the business, bringing on new feed sources, maybe a larger proportion of higher cost underground tons as well. Is that a fair assessment of what FY25 looks like? And then looking beyond that, should we expect that your sustaining cost base is going to continue to grow ahead of, I guess, what we would consider to be industry cost inflation in order to deliver that 2 million ounce target? Is it a case of continuing to you know, needing to bring on some higher-cost feed sources in order to achieve those numbers, or is that increased something that's a little unique to FY25? Are there factors to call out there that are somewhat unique? Thanks.

Thanks, Matt. A lot packed into that question, but I'll address it. So our exit rate, obviously, for the year, you know, the 1621 or 1.621 million ounces delivered at mid-1850s, And then when you look forward, we say, well, the bookends are 1.65 to 1.8 and the ACE being 1.50 to 1.100. I get the point saying it appears that there's a big step up if you're taking midpoint, midpoints, et cetera, from what we've just delivered. There's a couple of things in that. We have visibility of renewed contracts with escalation. So there are some known costs that we have negotiated, long-term contracts with major suppliers who are doing a fantastic job and with valid costs imposed, we've repriced those contracts. So we've got that. We also see the elevation of... what Goldpros is doing to flow through costs around royalties and other things that it attracts. We'll also see the introduction of things like traditional iron ore royalties that start to come in more earnestly this year. So they're impacted in there. We've got a higher escalational view of where some energy input costs are for the year. We may... not see those, and we may enjoy a reduction of those, but yet to plan. I'd rather be a little bit conservative on what we've historically seen there. There is still some grade-driven things in the interim to get to that full thing. So you pointed out saying it's higher-cost tons, higher-cost undergrounds. I guess it's not. It's that lower-grade material is now materially profitable. And I'm not going to say mind the margin, but I'm going to say that Grade denominates that. So when you drop it by decimal points, your ASIC will go up. But when the gold price is $3,500 an ounce and you're doing your reserves a bit over $2,000 and your resources around $2,500, there is a lot of headroom for profitable material that's in and around the activities that we're mining. It can change strip ratios. If you've got mill capacity, it can change cash flows, all those things. So We're also conscious about those grades and the incremental material that can be milled, albeit at a higher ASIC, but generating significant cash flow from those tonnes. So some of that incremental material sits in that plan. And then, yeah, look, this is a checkpoint on the way to... the sustaining long-term part. So, you know, Simon talked about Thunderbox, getting stability, but we've still got, you know, 5% plus availability to get out of that. We've saturated it with maintenance labour. We'll get it up, get it stable, then we'll start pulling away some of those resources. So, you know, there's some expensive ounces at the moment just because we're building and putting in contingency. But, you know, if you look across the sector, I think we're still... we're still pretty healthy compared to the average of increases that you're starting to see. So I'm not saying we're the best of the worst bunch. I'm just saying it is what happens when the gold price goes up. It drags the costs up as well. So, yeah, midpoint is still sub-$2,000. And when you start looking at the margins to that, it's very strong. So hopefully a comprehensive answer to your comprehensive question, mate.

No, I appreciate that. Thanks. Obviously multifaceted, so I appreciate the additional detail. Maybe just quickly, can I ask on the buyback, and I know Ryan touched on this in his remarks, but obviously you guys have been quite judicious in exercising that. You've obviously been constrained by blackout periods as well. Can you just remind us, I guess, how you think about... when you choose to enter into the market. In the buyback, obviously, you're sort of recutting your view on the value of the business based on gold price movements, et cetera, et cetera. But, I mean, broadly, in a gold price environment, all else being equal, should we expect that you would re-enter into the buyback at similar levels if you weren't constrained by blackouts?

Yeah, Matt, look, it's opportunistic, mate. I mean, you know, I sort of mentioned, you know, we're sort of nearly 20 million units purchased at average price of under $9. So I guess we're not just saying, you know, pin that news, just buy the rest of it out. We're trying to be opportunistic. Obviously, there's volatility in our own price. So, you know, and there's also competing capital. So the I think the best way to put it going forward is, you know, it's a board decision on where, you know, whether we extend the buyback, increase it or, you know, completely walk away from it from here. But that'll be wrapped up in the context of, you know, the next few years, the outlook and all these things. So I guess in a nutshell, we're opportunistic on it and I think it's worked well so far.

Thanks, Ryan. Thanks, Hugh. Thank you.

Once again, if you wish to ask a question, please press star 1 on your telephone and wait for your name to be announced. Your next question comes from Hugo Nikolaki with Goldman Sachs. Please go ahead.

Morning, Stu, SANA team. Thanks for the update this morning. My first one, just digging into Pogo a bit more, I was wondering if you brought any extra colour around The strong performance in the quarter, how much of that do you think was running the mill hard into the major shut versus maybe some optimisations you've been able to get out of the plant that maybe you can carry forward from here? And I'll come back with the second. Thanks.

Yeah, so look, to deliver that strong quarter, I guess everything was working really well. So the mining physicals were performing above the plan. The mill throughput performed above nameplate and very consistent throughout the quarter. Grade obviously was achieved throughout the quarter pretty consistently. So all those things, you know, controls and stability, delivered that exceptional outcome. You can see our dollar millions costs are still elevated whilst we're transitioning fleet and also getting change management settled and stability into things. So there's still opportunity to be able to reduce overall input costs, but we're also working hard to you know, all the planning and preparation to manage this plant shutdown and refurb on the plant in this quarter. So a lot of the thinking went into that. So, yeah, I wouldn't say there was only one single thing. I think the whole team across each department absolutely nailed what they did. And they've done it before, just not for 90 days in a row. So I'd give the credit is we've always seen the highlight of a week, a month, you know, two months. And then there'd be something either due to age of fleet or some other hand-to-mouth issue which sort of eroded, you know, impacted a week or two, you know, or the mill motor failure. Those are the things which, when you zoom out, looks like a low average. But we always saw the highlights of mine development, stope grades, you know, milled grades, mill throughput, run rates. So we're pleased to see it very consistently, which is obviously delivered consistently. you know, plus 360,000 ounce per annum run rate. That's what I think people need to look at it with this asset, is we're trying to get it to a stable 300. It just delivered a 363 run rate in the quarter. So, and we're not asking it to do that.

Great, thanks for that extra, Carl. And then my second one is just, you know, coming back to the FY25 costs piece. Could you provide any extra clarity just around how much of the all-in-setting cost guidance... might get impacted by inventory adjustments, you know, through things maybe like shuts and then any extra colour on the point you touched on around royalties increasing on some of the assets from things like native title and that sort of thing this year?

Yeah, so some of those things around gold price impacts, it'd be less than $50 an ounce, I'd put to that, and I'm not going to ever disclose what they are, but between state and third-party assets, contributions, it'll go through in that sort of magnitude. But when you look at inventory adjustments, there's no smoke and mirrors or silly games on PACE or growth capex or whatever. You just look through to our cash flow and see where money's been spent. Ryan, do you want to just talk of the treatment of the five-week Pogo?

I guess, yeah, so, I mean, Pogo will carry, yeah, its cost will be high because it will be carrying the cost while the mill shut. But I think on the inventory adjustments here, I think, you know, over the year, we will likely build more stockpile than, you know, than, well, build more stockpile because we'll be mining more than we will. And really what that does is it does carry a little bit more cost, I guess you could say, you know, because the operating costs, whilst they're backed out, the capital, obviously, that goes through each month and we spend on the business isn't. So when you're denominating less gold sold, you've still got your capital spend there. So that's a bit of it. I think I'll just say on cost, just the macro landscape, obviously, we're still seeing cost increases, as Stu mentioned. I think if you look at the midpoint to where we landed this year, it's 3%. in all the sustaining costs of land per ounce. So, yeah, there's still challenges out there. I guess we're hopeful that, as Stu sort of alluded to, we're hopeful that as some other, unfortunately, sectors are winding off, that maybe there's some opportunities there for us. But, you know, we can't bank them until we see them occur.

Excellent, Ryan. And just another one on costs around the repriced contracts. I'm just confirming there's probably still rise and falls in those, so if costs across the sector do start to come off, you can benefit from that to a large extent.

Yeah, there's rise and fall mechanisms in them. I don't know if we've ever experienced a fall. I call them rise and rise.

It's index-driven. And, Hugo, just on that, I mean... I think what I'd say is we are very fortunate that we have Northern Star Mining Service in our business because we are not experiencing the same, I guess, cost increase that we are getting from our third-party contractors. Yeah, that's a great point. And that's something at least that we're really wrapped with. And they're a growing industry. I guess they're growing the activity in our business, so it's really helpful there.

Yeah, so we do well over a billion, so we're nearly probably $1.5 billion of underground activity across our business, and over half of that is done by Inny House, all the star mining services, and they do stellar results, like Simon highlighted, go 500 metres a month, the jumbo wonder. We're getting a huge unit cost savings, and you don't get into it all what is quicker. we've got the two best contractors in the land, in our Northern Star Mining Services and Burncut, doing the primary work for us.

Is that actually how it goes? I'll pass it on.

The next question comes from Neil Watkinson with Kalgoorlie Minor. Please go ahead.

Good morning, gentlemen here from Kalgoorlie. Thanks for your time. I just want to focus first on the... the FY24 guidance where Kalgoorlie has hit, Pogo has hit, the overall has hit, but Yandel's just down a bit. Was that mainly due to the fire at Jundi, or were there a series of factors that just slightly constrained Yandel in the FY24?

Yeah, thanks, Neil. We kind of recall being flooded in on an island there in Kalgoorlie during the first part of the year. Yeah, it was a bit wet, yes. Yeah, so I don't know if you've got a tinny, but you would have needed it. All the goldfields were flooded for a large part of that year, so a lot of the... The haulage of open-bit material to mills was substantially impacted across the gold sector. We utilised stockpiles that were close to our mills throughout that period, which were obviously at different grades to our primary plan, but we were able to keep going through that. That was obviously Kalgoorlie, but also Karasu, including the northern yandle. mines of jundi pulling a really material down to a thunder box etc plus wonder being trucked up so that was probably the primary impact the secondary was this throughput um you know run rate of tbo which has now been delivered at six million ton nameplate for quarter four um very pleased with that um there was certainly impacts related to the the gold room um thermal event at Jundi, and the team did a fantastic job getting that back online. But in that process, we were able to utilise other infrastructure that we had to continue to produce gold from that carbon, loaded carbon. So, yeah, it certainly had impact, but the team got that container rectified in great, great order. So, yeah, Noel and Yandel had a lighter year on that overall guidance. That is the strength and beauty of having, you know, diversification of production centres, flex in the business plan, contingency of production sources that we do, you know, ducks on the water. We're kicking pretty hard and we're able to. restore and deliver into that guidance as a group. And it's great that sometimes those cylinders, you know, all fly together. Sometimes they're firing at different times. But, you know, we've seen Pogo really shine in this quarter. And that's, you know, that subsidised some of the setbacks that we got with the seasons here as well. So I think it's just pleasing to see the portfolio as all is contribution and no passengers across the group.

What caused the fire? Pardon? How did the fire start? What was the cause of it?

Yeah, they all... Yeah, Neil, Simon here. It was a scrubber unit on the back of the gold room. So you look at it, it's a very small piece of infrastructure and, you know, the team did a great job containing that within about an hour and a half. But it was just that part of the plant. There's a lot of electrical cables, so it took some time to rectify it.

And just a second question on KCGM. just gold sales down during the quarter. What's that expected? And also, how confident are you that you can wind up to $650,000 across the next financial year? 650,000 ounces, sorry?

Yeah, so I think the point is good on timing. If you kind of look at gold produced versus sold, there's obviously, you know, overproduction of gold there. So timing's everything. You've usually got a two to three week lead time on a refractory plant to get gold through concentrates and then through ultrafine grinds back into gold rooms and gold bars, et cetera. So unless the grade goes through three or four weeks before the end of a quarter, I'm saying that in a gold bar sold at the back end. And that was some of the impacts we've had with power, et cetera, across the gold fields. And time is everything. So there are events. What was the other question?

It just looks like KCGM is key to getting up to your guidance this financial year, winding up to 650,000 ounces. How confident are you feeling that you're going to be able to achieve that in the coming financial year?

I'm always confident, Neil. The guidance with the plan that's there, we have... clarity of the mine sequence. It's obviously driven by the material from the golden pike, the grade from the bottom of the pit, as well as growth out of Mount Charlotte and Finleston Underground being brought into the feedstock. So the backstop is always the low-grade stockpile. If you go and look at the group, we have three and a half million ounces in stockpile in and around our processing facilities, and the majority of that is sitting on ACGM. So You know, we've got years and years and years ahead of security of supply, and therefore it's the rate at which we get that milled and produced. The 650,000 ounces is fundamentally, you know, we've taken it from a 450 up to midpoint around 550, and then 650 is the last piece of getting into that grade. That is still only a checkpoint when the expanded mill turns on at 27 million tonnes per annum, gets ramped up 24.5 up to 27 over two years. And that'll take KCGM to 900,000 ounces per annum. So that's the ultimate game. $6.50 is the checkpoint. And by FY29, it'll be knocking out over 900,000 ounces per annum from KCGM, which includes the open pit contribution, a large undergrounds continuing in Mount Charlotte, and new undergrounds at Phimiston, as well as the supplemented low-grade stockpile to deliver that major top five global gold bond.

Excellent, gentlemen. Thank you very much.

Thanks, Neil.

The next question comes from Jared Lucas with ABC News. Please go ahead.

Good morning, guys. Looking forward to the Diggers site trip. I just wanted to... expand on, you slightly mentioned just how the nickel environment is changing the labour markets. Have you seen that with the closures we've had so far this year in nickel, has that reflected the labour markets yet or are we yet to see that flow into the market?

Absolutely. We've already seen our vacancy rate reduced so the ability to get staff in we've seen turnover reduce because obviously there's there's not jobs to go to um and we we expect to see again uh september october you know a flood of labor that's that's you know available um it doesn't necessarily mean uh it relates through to the changes in costs or you know labor reductions um you know rates all those sorts of things but it just takes away some of that pressure. It's sad to say, we're beneficiaries of that retraction, but it also was unique that all the cycles peaked at once when we had, with two years of border locked, that we had iron firing, lithium firing, nickel firing and gold firing all at the same time with inability to get imported labour. And the state was short 25,000 resource workers. That's why you got cost escalation. So this is the opposite side of that hill. Again, we've reached out to those proactively to say, be interested in our growth trajectory and gold's cleaner and greener and, you know, nice place to work in the goldfields, as you know, Jarrod, than the Pilbara. So we're encouraging people to look at our business and multi-decade outlook and secure their residential homes at Cowgooly and move there.

Thanks for that, Stuart. And I can attest it was an island for a while. And just one more on the Jundee renewable project. If you could expand on how that's progressing. I see the first of the four wind turbines is up. Once that's operational, is that going to have a material impact on your cost base at Jundee with electricity, obviously?

Yeah, so the overall mix of the solar wind battery will displace about 55% of the power inputs for Jundi. And ultimately, you know, it's a similar or an improved unit cost, given we amortise the project and have a... Power agreement, but it's important. It'll be the solar's all up and running and connected. The wind tower one of four will be – is done, and by December we'll have those four – corrected and commissioned and contributing. So, yeah, pretty pleased of what the progress has been made. And ultimately, this is about our commitment of, you know, 35% reduction by 2030. You know, and this is a major contributor to that. So we've already got the big solar field at Karasu. This is now the big solar in and the wind coming. And then we're obviously evaluating the broader gold fields project that will feed KCGM as well as Thunderboxx. Thanks, guys.

Appreciate it. Look forward to seeing you at Diggers. Thanks, Trevor.

Thank you. There are no further questions at this time. I'll now hand it back to Mr Tonkin for closing remarks.

Okay. Thanks all for joining us on the call, and I appreciate it. Obviously, it is a very busy morning. Look forward to updating you all as we continue to advance our profitable growth strategy. Thank you, and good morning.