Northern Star Resources Limited

Thank you for standing by and welcome to the Northern Star March 2025 quarterly results call. All participants are in a listen-only mode. There'll be a presentation followed by a question and answer session. If you would like to ask a question, nearly press the star key followed by the number one on your telephone keypad. I'd now like to hand the conference over to Mr Stuart Tonkin, Managing Director and CEO. Please go ahead.

Good morning and thank you for joining us today. With me on the call is Chief Financial Officer Ryan Gurner and Chief Operating Officer Simon Jessop. To start, we are very pleased that De Grey shareholders voted overwhelmingly in favour of the scheme of arrangement and we look forward to welcoming their team and their shareholders into Northern Star. I'd also like to take this opportunity to say thank you to all our employees and business partners who consistently deliver a strong performance, enabling both organic growth and inorganic opportunities like the de Grey acquisition. With gold price exceeding Australian dollars $5,000 an ounce, it is an outstanding time to be producing and discovering gold in the stable, low-risk jurisdictions of Western Australia and Alaska. Against this buoyant market backdrop, we generated strong net mine cash flow of $295 million in the March quarter, and pleasingly, there was positive contributions from all production centres, despite operational challenges at our biggest asset, KCGM. Our balance sheet remains in a net cash position, and our hedge book continues to wind down as we deliver to the set schedule. In the March quarter, gold sold totaled 385,000 ounces at an all-in-sustaining cost of Australian dollars $2,246 per ounce. Mining of the high-grade open pit ore at KCGM was delayed because of low productivity in the Golden Pike North area, but I'd like to emphasise that the impact to the ounces is a delay only. As we look ahead in the June quarter, the high-grade ore is now accessible with mining efficiency on track to lift significantly. And more broadly at KCGM, we remain impressed with the progress we are making on this multi-decade asset. The foundations are established and we are commencing a very exciting period where we are poised to generate a positive step change in free cash flow generation from KCGM. As a result of recent operational challenges at KCGM, we have revised our FY25 group production guidance to 1.63 to 1.66 million ounces. Partially offsetting KCGM impact, we have increased guidance of PUGO as the mine continues to deliver consistently strong performance. Turning to the FY25 all-in sustaining cost guidance, we have increased the range to Australian dollars $2,100 to $2,200 an ounce as a result of delayed access to the Golden Pike North. Some unplanned maintenance costs at Yandle and also the higher royalties from the elevated gold prices. Detailed guidance information is provided on page three of the quarterly report. Continuing our KCGM mill upgrade, our project team remains very busy and I'm pleased with the progress of the KCGM mill expansion to date. There have been significant activity during the quarter as observed by all the structural installation of the major plant components on site. The project remains on track and FY25 capital expenditure guidance of $500 to $530 million remains unchanged. I'd now like to hand over to Simon Jessup, our Chief Operating Officer, to discuss our operational highlights.

Thank you, Hugh. For the Kalgoorlie Production Centre, which includes Casey Gem, Karasu Dam and Kalgoorlie Operations, we sold 197,000 ounces of gold and Australian oil and sustaining costs of $2,139 an ounce. This production delivered a mine operating cash flow of $332 million. The region also spent $262 million on significant growth capital projects. This included $121 million on the Casey Gem Mill expansion, $37 million on Casey Gem open pit mine development, and $41 million on Casey Gem underground mine development. At Casey Gem open pit material movement was 15.3 million tonnes. with mining efficiencies being impacted by slow productivity while destacking the eastern side of Golden Pipe North. Mining efficiencies have since improved and we are confident mining volumes will increase to 20 to 22.5 million tonnes per quarter from the June quarter. All mine from the open pit saw the beginning of a step change in ore volumes, with 2.2 million tonnes mined and 84,000 ounces in the quarter, a 90% increase in ore and 100% increase in ounces compared to the H1 quarterly average. We look forward to increased ore and total material movements from Casey Gem as the efficiencies and opportunities return to Casey Gem's open pit. Underground mining volumes at Casey Jam are 4% higher quarter on quarter and 29% higher year on year. Casey Jam's underground operations increased development to a new record of 7.4 kilometres for the quarter. The development metres will continue to increase as we begin to open up more of the Fimston Underground and Mount Charlotte ore bodies. A new Casey Gem portal will be developed in the Drysdale area during the June quarter, which will be 400 metres below the surface. This platform will commence the journey of delineating the many mineralised systems at depth and is very exciting for Casey Gem's long-term growth. At Karasee Dam, mine ounces were consistent quarter on quarter at 65,000, while ounces sold were lower due to a smaller contribution from the underground mines, which will reverse in the June quarter. The Kalgoorlie operations, underground mines and mill delivered to plan with a 15% reduction in all-in sustaining costs to $1,892 an ounce and a 10% reduction in all-in costs over the quarter. Processing volumes at Casey Gem were lower due to its planned major shutdown and lower availability and utilisation over the quarter, impacting gold sales. A higher head grade for Q4 is expected as all volumes from the open pit and underground sources all increase. The Casey Gem mill expansion project is 46 complete at quarter end, on time and within budget. We remain very pleased with the on-ground construction from concreting into structural and mechanical installation. Total engineering progress for stage one is at 89%, while all design reviews are now complete. The concrete port is 65% complete with an impressive 19,000 cubes poured to date. At our Yandall production centre, including Jundee and Thunderbox, we sold 120,000 ounces of gold at an Australian oil and sustaining cost of $2,398 an ounce. This production delivered a mine operating cash flow of $210 million, while we spent $91 million on growth capital projects. At our Jundee operation, development advance increased to 7.9 kilometres. with over 3.7 kilometres in development drill platforms completed year to date. Lower mine grade was from the Griffin Underground development ore commencing with milling grades forecast to remain at similar levels in the June quarter. Griffin development continued to ramp up over the quarter as a future new ore source while processing was again on plan. The Thunderbox operation mined 64,000 ounces for the quarter. the Wonder Underground mine continued to ramp up ahead of plan, with 1,552 metres developed, with one jumbo averaging 517 metres per month. In the open pits, the Otto Boer mine was completed at the start of the quarter, while the Bannockburn open pit commenced mid-quarter as an important long-term fee. At the Thunderbox process plant, we milled 1.43 million tonnes and sold 56,000 ounces of gold. The mill throughput averaged a new quarterly record of 839 tonnes per hour, 12% above name float. A major shutdown was completed within the quarter. For our POGO operation, we sold 68,000 ounces of gold at an Australian oil and sustaining cost of $2,292 an ounce. This production delivered a mine operating cash flow of 126 million. During the quarter, I visited POGO for my second time and met with the team to understand the current operational status and their opportunities. I was very impressed with the quality of the work the POGO team is undertaking, while also seeing significant opportunity for growth at this asset in time to come. Development lifted 10% quarter-on-quarter to an average of 1,500 metres per month, while the operation is now mind-constrained with milling on demand. I would now like to pass over to Brian, a Chief Financial Officer, to discuss the financials.

Thanks, Simon. Good morning, all. Northstar remains in a great financial position. Our balance sheet remains strong with net cash of $181 million at 31 March. Figure 9 on page 10 sets out the company's cash, bullion and investment movements for the quarter, with key elements being the company generating $846 million of operating cash flow, a 22% lift on the prior quarter. After deducting capital of $529 million relating to the Casey Gem expansion, plant and equipment and mine development, $58 million of exploration and lease payments, quarterly free cash generation was $201 million. In relation to our FY25 growth capital projects, the Casey Gem expansion project remains on track with spend of $121 million during the quarter. Activity included progress of engineering, design work, construction, concrete pours and steel erection. All major equipment items have now been delivered to site and forecast capital expenditure for the year remains unchanged at $500 to $530 billion. Accelerated activity across the Australian portfolio has driven our FY25 forecast growth capital expenditure, excluding the mill expansion, higher to a range of $950 million to $1.1 billion. This includes at Yandel, development advance ahead of plan at Wonder Underground and Griffin, as well as higher material movement at Aurelia whilst in development. And at KCGM, development advance ahead of plan at Mount Charlotte, additional costs associated with finishing the east wall remediation works and greater activity in the phimison south cutback due to delayed access to golden pike north which has also driven some efficiencies and higher unit costs today we have flagged that our exploration expenditure will be higher for the full year from the previously guided 180 million to 230 million with additional funds allocated to further advance underground drill platforms across Casey Gem, Pogo and Jundee. This investment will pave the way for enhanced drilling programs across those assets in FY26 and FY27. On other financial matters, Year-to-date depreciation and amortisation of $803 per ounce is at the midpoint of the guided range and is expected to remain within the range for the full year. For the quarter, non-cash inventory charges for the group are a credit of $44 million, primarily from the increase in stockpiles at TBO, CDO and KCGEM. $8.5 million Northern Star shares were bought back and cancelled during the quarter. Sorry, that's $8.5 million. Apologies. Bought back and cancelled during the quarter. The company is 89% through the $300 million program. As previously highlighted, the company has now begun paying corporate tax on its Australian operations. The current estimate for Q4, which will depend on gold price, is between $60 to $80 million for the Australian operations and $30 to $40 US million for POGO. Also a reminder that we will pay interest on the notes in Q4, which will amount to 18 US million. The company's committed hedge position at 31 March is set out on Table 5, page 10. During the quarter, the company delivered 135,000 ounces into contracts and did not add any further commitments. 70% of the hedge commitments align to the build and early commissioning phase of the KCGEM plant expansion. In relation to the recent impulse of tariffs on goods imported to the US, we continue to monitor and assess the impact to our POGO operations, including country of origin assessments for the operations direct and indirect supply chain. And finally, in relation to degrade, the consideration value paid will be ascribed to the assets acquired, which is expected to be tax deductible from the implementation date. Northern Star may also be eligible to consolidate De Grey's tax losses, which will be confirmed post-implementation. Current estimates of the landholder duty obligation from the transaction is in the range of $200 to $300 million, which is expected to be payable within 12 to 18 months. And as the transaction is likely to be an asset acquisition for accounting, transaction costs will be capitalised into the asset value as opposed to expensed in the income statement. I'll now pass back to Darcy for the Q&A. Thank you.

Thank you. If you would like to ask a question, please press star 1 on your telephone and wait for your name to be announced. If you would like to cancel your request, please press star 2. If you are on a speakerphone, please pick up the handset to ask your question. Your first question today comes from Daniel Morgan from Baron Joey. Please go ahead.

Hi, Stu and Tim. First question is just about the, I guess, the operations at the super pit and the delay to accessing Golden Pike. Can you just describe how far, like, is this just a delay on the business plan that was articulated a couple of years ago and we should just be moving that business plan to the right? Or does some of these productivity issues mean that what you thought two years ago and how much you could get out of Golden Pike in, say, FY26 and beyond? Like, do you have to slow down and be more selective mining? I'm just trying to get a feel for how far into the future these issues translate.

Yeah, thanks, Dan. It's an important point. I guess you're right in saying that five-year strategic outlook was delivered in July 2021, right? So we're at the tail end of that for that 2 million ounce target. And it's not about if we get to 2, it's when we get to 2 as we then add the mill expansion and then integrate HEMI into the overall outlook over future years. So Our attitude is, no, the gold has not moved for three billion years. It is still there. It's the rate at which we're extracting it. We certainly have experienced some of that destacking of the multiple work areas and the congestion with the fleet at the bottom of the pit floor, which we're overcoming. So it's really about now, you know, the efficiency coming back, the productivity coming back and those tonnage rates basically filling the mill with the primary oil from the pit. stockpile material. So it's against where we'd maybe been aggressive on everything going perfectly well. And Simon can talk about the confidence of the outlook, but it's really just about the rate at which we're mining at the bottom, having that east wall remediated and that waste removed from above us.

Yeah, just to add to that, Daniel, really pleased with where we are positioned. So late in the quarter, we finished the difficult mining of the D-Stack and now we're back to just normal, efficient benches mining down on the east side of the pit. It is purely a slight delay to the ounces. It's no change on the future outlook. The pleasing thing is we're past the low productivity efficiency of mining big rocks in the destack area. That's all finished now. We're just destacking with normal benches. So we're in the best shape we've been in that part of the pit.

I know plans are always theoretical and they come up against hard-won experience. Just wondering if given the time you've had in this with the physical experience of Golden Pike and mining the super pit, do you have the right number of equipment and the right resourcing to achieve your outcomes or do you have to revisit how many trucks you need, etc.? ?

Yeah, Daniel, I think in the commentary I talk about now we're past the low efficiency mining in that DSTAC area in particular. We will revert to that 20 to 22.5 million tonnes a quarter. from this quarter. And we've started this quarter extremely well in terms of total material movement. So now we're past that difficult part, which is behind us. We're seeing all the productivities lift, the trucking hours lift, the digging efficiencies lift. So very, very confident going forward.

And just last question and apologies. I mean, everyone on this call has got a lot of results today. And I may have missed this, but I think you alluded to you lifting your expiration spending today and you're lifting some of your capital budgeting today in relation to, I think, some success you've had on the expiration piece. Can you just expand on that piece? Thank you.

Yeah, thanks, Dan. So these largely are leading indicators in development for drill platforms to feed into next year's drilling budget as well. So we had $180 million, so lift that beyond $200 million, largely driven by the drill platforms across Pogo, heading to the north, those north veins across to Goodpaster, KCGM, including a new portal to be cut down in the west wall at Drysdale, and equally over at Yandall, big drill platforms across Yandle, at Jundi, et cetera, and some of the new underground. So it's really the lead indicator. The drilling, the actual drill metres and drill core, you'll see reflected in our reporting of our resource and our reserves coming out in a week. And then this is drill platforms that feeds into that as well.

Thank you very much. Thank you. Your next question comes from Kate McCutcheon from Citi. Please go ahead.

Hi, morning, Stu and Ryan. So just the guidance revisions, it is material 400, 415-ounce cost increase. How much of that are you putting down to royalties? How much is the angle at high-end maintenance? And how do we think about that KCGM head grade hitting the mill into Q4?

Yeah, thanks, Kate. I'll start with the question on the costs. Yeah, so royalties and foreign exchange is likely to be $25 to $30 an ounce. You know, when we cut the full year numbers is where we think it'll land. Obviously, this quarter, gold price is much higher than it was the prior quarter. So just did the outlook there. It's probably about $25 an ounce currently for the year-to-date cost base is that. So that'll probably lift with the gold price. And then the unplanned maintenance across the year is going to be, you know, it's currently probably $30 an ounce. We don't foresee that happening. We don't foresee additional costs this quarter at Yandel around maintenance for the processing facilities. So it'll probably likely land about $25, $5 an ounce. So in combination of those two items, they're about $50 an ounce in combination of those two year-to-date costs.

Okay, got it. And the KCGM head grade for Q4?

Yeah, Kate, Simon here. Just in terms of the head grade, you can see that for the quarter, we mined 84,000 ounces from the open pit at a head grade of around about 1.3. So that's similar to feeding into the mill last quarter. What you'll see in the next quarter is the underground contributions start to kick up as Fimster Underground gets into its stoping. as well as a much higher contribution from the open pit across not just Golden Pike, but OVH as well. So you'll see the head grade for the mill lift probably in a range of 0.3 to 0.5 of a gram per tonne in quarter form.

Yeah, because I think you had previously said the undergrounds will be running at 3 to 3.5 million tonnes by the end of the FY.

Yeah, the undergrounds are building that development piece is that lead indicator. So we're still seeing last two quarters 7.2 kilometres, 7.4 kilometres. And then the stoping is turning on in terms of Fimmerston, as well as a lift out of some stoping areas at Mount Charlotte. So it's not a straight line. It is lumpy with the production coming in, but really happy with the way we're setting up Union Consoles, Union Jack, Golden Pike Stock Works, which is all three mines within Fimmerston itself. So the production fronts are building and we're developing a lot of areas with a lot of production drilling. So stoping has commenced for Fimston and it'll now get a real kick and lift.

Okay, thank you. And then a question for Rhyme. So you noted the tax benefits from incorporating DeGray but no DNA uplift for the group until Hemi delivers first gold. The latter part makes sense, but not so much the former. Can you just talk me through the delta or how we think about the tax impact for the next five years that you've called out in the results?

Yeah, sure, Kate. Yeah, so you're right. So DNA won't start till we start pouring gold bars. So you're right there. Yeah, tax is a funny one, but a good one, I guess, for the business. So I guess the acquisition value is what we pay. So we'll be issuing shares at a price on implementation date. So that's the value that's marked. And then some things like cash that de Grey hold aren't relevant for that valuation piece on the tax base. So it's going to be a significant value. But from a tax perspective, we can start, I guess, depreciating a reduction in our taxable income from day one. That's the advice and that's what we'll be doing. Now, of course, tax lags. So it's not going to, you won't see it day one. It'll be more so later when we do our tax return that you'll start to see that catch up. Yeah.

Okay. And is there anything you can say on the magnitude?

Well, it'll be accelerated. i guess it's going to be something like you know between 5 billion and 5.5 billion and it will be deductible so 50 of it will be deductible over five years so tax you can accelerate so that gives you some indication it won't be linear but it'll be it'll be something like that remembering that we've still got to do all the work and the final values have got to be set but but that's that's the thematic

Thank you. Your next question comes from Hugo Nicolaci from Goldman Sachs. Please go ahead. Thank you. Your next question comes from Levi Spry from UBS.

Good morning, Stuart and team. Thanks for your time. It's a busy day, so details might be a bit light, but just following on from Dan and Kate there, great question. I'm going to explore that going into sort of next year. And understanding that this is categorically just a quarter delay to what we were thinking about before, that all of the de-stacking is finished, the underground ramp-up is on track, and that that overall head grade still hits from 1st of July. So can you just expand, Simon, on that grade piece through this quarter, I guess?

Yeah, thanks, Levi. Look, the de-stacking, it's half finished where we are, but we're seeing signs now in this quarter of the improvement of those productivities in Golden Pike. So, you know, we're showing kind of the turning point of the performance coming out and the grade coming out. But the backstop's always, you know, the stockpile grade going in and as the underground volumes from development or interstoping contributes. So that's, you know, that quarterly delay is really our, you know, the FY25 delivery of guidance. We're not talking about FY26, but these things are, you know, they're all on a pathway to add I appreciate everyone wants the rest of their models filled out, but we're here just to really, you know, recap on the events of the quarter and the outlook for this quarter. And in normal course, we'll be publishing in the July, the June quarterly, plus the outlook for FY26. And we're very excited with the progress across all the assets, albeit there's some slippage on, you know, weeks and months. We're very happy with what we're seeing, you know, in regard to the outlook.

Yeah, OK, thanks. And so just expanding on the grey piece then, can you just talk us through the timelines there in terms of your plans for integration and optimisation of that into the portfolio, what that could look like after May 15th?

Yeah, so completion with that D listed now, the completion is the 5th of May, so, you know, I guess a week away. The integration, obviously, with the team occurs rapidly, but, you know, it still depends. So that's still, I guess, the FID point, but all the other works on the mill, EPC, EPCM decisions and the mining contracts and all of the long lead items and the progressing sort of stakeholder engagement, all those things that have been continuing over the years. in parallel with the De Grey team for a number of months now. So we will basically map out what that looks like. But essentially, the CAPEX will need to be reviewed, assessed, you know, dusted off to make sure it's relevant. But our learnings from KCGM has impressed us on ability to take learnings from Fimbus to pretty excited about those opportunities that we can bring to that. And it's likely the second half of this calendar year will be giving more colour on the timeline for heavy development.

Nice one. Okay. Thank you. Thanks.

Thank you. Your next question comes from Andrew Bowler from Macquarie. Please go ahead.

G'day, Stu, Ryan and Simon. Maybe one for you, Simon, just expanding on Kate's question about the KCGM undergrounds. I think Kate sort of mentioned that, you know, previous commentary was, you know, rough exit rate of 3 million tonnes per annum this year and then sort of grinding its way up by half a million tonnes per annum per year over the next couple of years. Just wondering if you could just give us a fresh update on that sort of expected growth rate of half a million tonne per annum that you've commented on previously. Is that still valid or is it likely to be a little bit shy of that over the next couple of years?

Yeah, Andrew, I think as we normally do it around diggers and that quarter one will provide a good KCGM update as to where the underground's at, the open pit and all of the assets, but It is very lumpy, as you can imagine, trying to develop from Fimmerston underground. There's three mines within one we call Fimmerston, but there is genuinely three mines within that particular mine. The thing we are excited about is the development of all of those levels really opening up, as well as, you know, the bypass link we're doing down to Croesus, which... mentioned in the diggers presentation last year crisis is right near the surface and um we've nearly we'll be getting into that with high tons big product productive areas uh early into next year so um the building blocks are all happening um we're expanding very very rapidly at that particular area um things like drysdale that will will uh is new new to the um I suppose, news flow that is 400 metres below the surface. And, you know, we get into the West Wall down below 400 metres there and then really can accelerate some huge opportunities there. So pleased to provide an update on the underground really in that Q1, sort of July or August sort of area. But in terms of the lead indicators, very, very happy with the underground progress.

No worries. Thanks, Dan. Maybe just one for Ryan as well. Obviously, you talked about the DeGray assets coming on the balance sheet and being able to reduce your taxable income with those day one. Just so I can understand a little bit better, as a non-accountant, it sounds like you're saying on a dollars per ounce basis, you will see a lift next year in depreciation, not just a dollar million lift as well. It'll be actually over the ounces you're producing from the other assets, you'll see an increase in DNA next year. Is that correct?

No, Andrew, the opposite. So we will be getting a tax shield from day one, which you'll see in cash, cash flow. But from a DNA P&L perspective, no. So we won't have any depreciation until we start pouring gold bars at Hemi. So in the future, so the DNA next year for the business won't be really any different to what it is now. So it's only when we start pouring gold bars that you'll see a depreciation amortization step up or change. It's about tax cash now that we get the benefit from.

Okay, copy that. So it's more the, you know, the built-up losses that have happened, you know, within DeGray already, more so than obviously, you know, depreciating our setback. Okay, yeah, copy that. Appreciate it. That's awesome, man.

Thank you. Your next question comes from Al Harvey from JP Morgan. Please go ahead.

Yeah, morning, team. I suppose you have mentioned that you are coming up to the end of your five-year timeline for the FY26 target. I suppose just wanted to get a sense on when we might get an update on the next five-year outlook and how things might have changed given high gold pricing environment, how that's changing, how you're thinking about potential further growth. Maybe just, yeah, an overview on that would be helpful.

Yeah, thanks. Thanks, Al. And we'll, yes, today's not the day to do that. I know it's a very busy day for reporting. But as you know, you know, our sort of July guidance outlook for 26 and round diggers where we present the outlook is probably good timing to give a bit more flavour. But I would say, you know, the 2021 five-year outlook, you know, what has changed, we've seen great stabilisation, performance, improvement from POGO. We've seen you know, delivery of expansion and continuity across Yandel. The CalOps have been firing on all cylinders, as does CDO with cash flow generation. And then it's really KCGM around that East Wall remediation, which was, you know, an unproven plan when we committed to it, but we're a long way through it. So it's really on top of that, the mill expansion you've seen being, you know, approved and we're over halfway through it. as well as now an inorganic opportunity with the addition of Hemi to the portfolio. So, you know, a bit has changed, but fundamentally it's very positive change. And the gold price has lifted $3,000 an ounce Australian. in that same period. So if we hadn't changed something or hadn't improved stuff, you know, we'd probably be mad. So I think it's just a much stronger outlook and we will certainly be looking, you know, at the next sort of, you know, three years fundamentally when all those catalysts come back in. and really look at that active portfolio management and really looking at the best highest margin ounces. So a lot of the decisions we've made in previous years are still correct and right under the current gold price environment and we're executing and delivering on those and we were aware that they were multi-year commitments and we're still charging through the actions to stabilise and make that sustainable because we're looking at a multi-decade outlook. So yeah, we're pretty excited and you'll get an update this calendar year look for the next few years.

Sure. Thanks, Steve.

Thank you. Once again, if you would like to ask a question, please press star 1 on your telephone and wait for your name to be announced. Your next question comes from Matthew Fryman from MST Financial. Please go ahead.

Sure, thanks. Morning, Stu and team. Can I ask on Hemi, and you've obviously highlighted that the next key step is more around state and federal permitting. Can you give us a bit of a, I guess, a more in-depth update on how that's tracking from your perspective? I'm particularly interested in how that process goes particularly through the state and federal election periods, potentially some movement in the various bureaucracies there. So wondering how that is kind of playing out and how you expect that to potentially play out. particularly through the federal election period. And then secondly, I guess, in terms of your internal permitting team, presumably taking over some of that work that the DeGray team has been conducted. Obviously, you've got an external driver, which is the state and federal ministries, but there's also an internal driver there in terms of you guys getting up to speed with all of that work and And as I say, potentially taking over some of that responsibility in liaising with those departments. So it does seem like the timelines continue to push out a little bit on this process over time. So is there a timeline that you're currently hopeful to working towards in terms of final approvals? When do you expect to get a decision around that? Thanks.

Yeah, thanks, Matt. And I think, you know, De Grey had been articulating what the timeline was and we're not, you know, indifferent to what that is and what was published in the scheme documents. So we were perhaps a bit more conservative and had a bit of a buffer. returns outlook or timing. And in fact, the neatness of teams moving from FIM into HEMI is very strong. Now, we're not, you know, until completion and we're there, we'll be engaging with all the stakeholders. We've stayed very close to decisions to date. But likely in the next quarter, we'll have feedback from regulators and on you know after doing site visits and after doing reviews and stakeholder engagement so you know this calendar year we'll be getting updates and and passing that through to the market as we we learn those things uh and fundamentally we don't see any you know federal or state um obviously stability of the political landscape changing this we have very good experience through the section 38 um at kcgm uh recently with that experience with regulators so we're very familiar with the process and engagement with those regulators throughout the HEMI approval process as well. So, yeah, all considered, all understood, and nothing is different to what we expected, I guess, when we announced this deal late last calendar year.

Yeah, got it. Thanks, Hugh. Is there any sort of... I don't want to say drop dead date, but any sort of timing that you're conscious of in terms of making long lead item decisions or design decisions around the project whereby you'd really need to have some kind of firmness around approvals come in before you go down that path or you're pretty flexible with the timing in terms of some of those design decisions.

yeah so i think importantly this was all done well before announcement and you know the due diligence period we completed good good reviews of all of those um you know the flow sheet designs that the comfort with the the mining volumes and the plans and etc now you don't want to change things um because you're resetting clocks on approvals right so fundamentally it is what is being put in we're happy with that and it is going through the approvals process um so you know, leaving technical boffins looking at stuff, they'll continue to tamper with it. We've definitely frozen it and understood that it's a good plan and it's what's being approved and we're okay to follow that and execute it on that timeframe once approved. But some of those timelines, I say out of our control. They're understood and they're predictable in Australia, which is why we love tier one jurisdictions and understanding of that regulation. But we can't speed it up. And I guess we're going through the due process and doing it predictably. And therefore, we're not going to repart and rechange and modify because it will add time to resetting some of those time on approvals, which we won't do. So There's a very strong understood business case that De Grey have articulated. There's some refining and optimisation as you go, but it's really on the margins as opposed to wholesale changes to that DFS plan.

Yep, understand. Thanks, Stu. And maybe just finally, again, coming back to the kind of integration piece, can you remind us, I guess, what the vision or the plan is in terms of how much of that work you know, you internalise back onto Northern Star teams or, you know, how many kind of teams or members of the de Grey team will continue to sort of conduct the work that they were doing previously? I guess, yeah, how do you see the division of responsibilities in terms of progressing the project forward? Thanks.

Yeah, we're well rehearsed at integrating assets along the journey, as you can sort of see by history. You know, there's roughly 120-odd degrade people that have been, you know, building up this asset over the time. They come in as a hemiaproject, you know, under Northern Star Banner. There's no, you know, island or isolation or silo there, and they're enhanced by our corporate underpinnings. 350 plus geologists with our 250 plus mining engineers. You know, we have more technical prowess than any, you know, contracting external house in-house. We have that. We have that skill. And that's what we bring for DeGray shareholders to an asset like this to de-risk it. as well as a net cash balance sheet fully funding the build of this, plus the outlook of, you know, dividend paying day one. All these things are the merit as to why we got a 99.6% approval on the votes that were put on this scheme of arrangements. So I think it's our job now to demonstrate, you know, why it's de-risked and how we can move this project forward on a lower risk basis. And that's because of our bench strength. We've got nearly 7,000 employees with our contracting partners. DeGray has 120. So I think it shows that we're going to be able to help assist this project better than anyone.

Yeah, I understand. Thanks, Stu. And looking forward to more updates later in the year. Thanks. Thanks, Matt.

Thank you. Once again, if you would like to ask a question, please press star 1 on your telephone and wave your name to be announced. Your next question comes from Hugo Nicolaci from Goldman Sachs. Please go ahead.

Good morning, Stu, Brian, Simon. Apologies for technical issues earlier, and some of these points have been subsequently covered. But just picking up on some of the earlier questions, you've obviously highlighted some of the new term challenges at KCGM and the accelerated growth spend ahead of plan in some other areas. I guess looking forward, if we take your revised guidance midpoint into the fourth quarter, it's implying a gold production run rate of about 1.8 million ounces. But based on some of the comments today and operational improvements, it sounds like that should probably be trending upwards. I guess marrying that up with some of the comments you've previously made, Stu, around having levers across the portfolio to deliver that 2 million ounce target, how should we interpret those 4Q rates into FY26 and then relative to that 2 million ounce target going forward?

Yeah, thanks, Hugo. I think earlier in the call I reiterated we're not providing F1 26 guidance today. We're updating on the March quarter, and as you've just done the maths, quarter four shows that. But they are all good signs and good signals as to what the outlook can be. And as I said, it's not necessarily if, it's when, you know, the overall, you know, 500 and a quarter plus plus with the mill expansion and Hemi's addition in future years. These are just checkpoints because it's not a straight line of growth. So, yeah, we're not providing 26 today. In due course of normal time, it will be assessing that and likely the July announcement with the June quarter and the FY26 guidance with costs will come at that point.

Great. Thanks, Stu. And then just picking up on the comment you made a little bit earlier around active portfolio management in the current gold price environment, are there any assets in the current portfolio that you think maybe don't have the same medium-term opportunities as others in the portfolio or maybe aren't being appropriately valued in the broader portfolio context?

Yeah, good point. We probably don't think any of them are being appropriately valued at this gold price, but they are all contributing to our cash flow balance sheet strength and the investment we're putting back into the assets. So the recognition is really part of what we've done always, is just looking at our highest margin ounces, where our investment's made and that future outlook. So, yeah, it's just part of how we think around the business first and not having to just be hoarders and collectors. We're certainly wanting to make it most efficient for our shareholder returns. So that'll be part of the review, you know, at the back end of this year.

Got to thank them. Just lastly, if I can, on the reserve and resource update, should we still expect that in the coming weeks, consistent with sort of the timing over the last few years?

Yeah, I think I said in the coming week, but I should have said coming month, just to correct that. So we close it at end of March and we're doing that assessment work presently. So, yeah, typically in short order after that, we'll be releasing the resource reserve. So it could be in May. It's probably more like the timing could be at the back of May.

So thanks for that. I'll pass it on.

Thank you. Your next question is a follow-up from Daniel Morgan from Baron Joey. Please go ahead.

Hi, Stu, Ryan and Tim. Just a question on the hedge strategy. I mean, I don't want to be Harry Hindsight and go back and rerun the tape on gold prices and what we could have or should have done. But I just note that you've had two quarters now where you've allowed the hedge book to run off. Is that some recognition that the hedge strategy is perhaps not working or dated now that you're a larger, more diversified company and just wondering whether you might continue to let these hedges roll off over time and reduce your hedge book in time?

Yeah, thanks, Dan. We're still within policy, so it's not indifferent to our policy. And the hedges were placed at the right time for the right purpose to achieve the right outcome. Things like Femiston FID, the hedges that were placed at that point equally were, you know, $500, $600 above the FID decision amount. So, yeah, we certainly... We certainly aren't saying, you know, Captain Hindsight says we're out of the money. If you plug in the spot price or whatever number you use for mark to market, you'll get, you know, plus $10, minus $3 is essentially what you'll end up with. But it is what it is and people understand it and it's visible. And I think you've seen us unwind the last two quarters, not add forwards.

Yeah, thank you. And maybe just a follow-up uh separately i mean the gold price is up um quite simply bananas versus anything that we would have thought um several weeks months or a year ago or two um just wondering how that feeds into how you manage your business um if at all you know do you let this gold price fall to the bottom line or do you look at the fringes of your old bodies and and things and go well let's um Let's expand mine lives and change grade decisions over time. Just wondering how you think the gold price feeds into running your business.

Yeah, look, I'd say it certainly doesn't change near-term decision making. We've been set on some rails of some good long-term investment decisions under any gold price environment. They're all working to try to get our unit costs down, economy scales up. and they absolutely get enhanced to survive those decisions at a higher gold price. Albeit, the higher gold price, as we see across the sector, drags up costs. So that's the part, you know, plus the tariff turmoil. Those are the things that we have more focus and understanding of protection against than gold price. They're the things that directly hit margin and bottom line, and that's probably where more of the attention looks at. and cut off grades, et cetera, rather than gold price, and it's always been the case. So, yeah, no one's wholesale changing mine plans because of where the price is at. We're certainly just looking and observing as we go.

Okay. Thank you, Stuart and Tim.

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

Well, thanks all for joining us on the call. I appreciate it is a very busy reporting day. We'll make ourselves available over the coming days to address any of the outstanding matters. So thanks very much for joining us on the call. Look forward to updating you soon and have a great day.

That does conclude our conference for today. Thank you for participating. You may now disconnect.