Aeris Resources Ltd

Okay. Good afternoon, everyone. And thanks for joining quarter one, FY26 results from Ares Resources. Just a normal disclaimer. I guess once again, we had a good last quarter in FY25. And once again, quite a solid performance from the team on quarter one for FY26. This is just a standard, just talking a little about what we're doing going forward. Obviously, Triton this year is looking really strong, and we'll talk a little bit more in detail, but looking at around 25,000 tons, between 24,000 and 29,000 tons of copper from Triton. And again, we sometimes forget that Triton also do around 8,000 to 10,000 ounces of gold and around 250,000 ounces of silver. And, you know, that is quite a large, a big number in terms of credits on those two commodities, especially at these sort of prices. At Graco, we're forecasting in the guidance around 36 to 42,000 ounces, around that 40,000 ounces for FY26. And both these operations is delivered accordingly to those. And we'll touch on the projects as we move forward. I just thought it's appropriate to just re-emphasize this strategy. And clearly, when we go through the quarter results, we are basically doing exactly what we set ourselves out to do. So at Tritton, the pre-strip of the Marwambi pit is important and on track. We've invested around $25 million this quarter in that pre-strip. And we'll get into a bit more detail. Consolation approvals is underway and the timing for consolation starts. towards the first quarter in FY27 is looking strong. And, you know, it's the first time in a long time that we're putting around $20 million in exploration across the business. And it's really that focus on resource extensions and life of mine updates and increase in the life of mine. So both of Triton and Krakow is focusing on those. Golden Plateau is a exciting opportunity. We'll touch on that again. We have been saying for the last, three months or so that we are selling our North Queensland assets. Now we're running a process and that's getting close to completion and we'll up to the market as soon as that's done. But it was all around moving on non-core assets, but also that simplifying the business across the group. The JAG strategy is clear in our mind. It's reducing the care maintenance costs, focus on extending the mine life a lot of base metal targets available for us to go and drill. We've allocated $3 million in this financial year to test those eight targets. We'll touch on that a little bit going forward. But it just makes sense. Don't start the mine with less than 10 years. There is opportunities to create a 10-plus year mine life, and that's when we will start it. So the next 12 months is all about focus on those base metal targets and extensions of those. On Stockman, we finalized the Albion test work. We're busy updating the studies. We'll update the market within the next few months, and really then it will be what do we do next and where do we take Stockman. On the growth, focus on resource extensions, and you'll see through the presentation, you know, we are spending the money where we said we're going to spend it. And then on the balance sheet, we considered hedging. We did hedge 20,000 ounces at around $5,200 an ounce. It's much lower than the current price, but it was with specific reason. We knew that we will spend about $70 odd million in growth capital doing the pre-strip of the Mara pit and also a new Thais dam at Krakow. And that was to ensure that we can underpin those capital expenditure. So that's sort of just a summary. We've been saying this for a few months now, a few quarters. And we're clearly in line with what we're saying we're busy doing across the business. So at quarter one, once again, a solid performance against the internal plans, 10,300 tons of copper equivalent. Cost, as always, and capital across the group well managed and within our own internal target. Cash and receivables at quarter, $46 million. Cash has gone up, receivable slightly down. That is just timing of specifically Triton Concentrate sales, but a strong healthy position considering that we have put close to $30 million into growth capital. So it's a self-funded capital growth exercise. And when you talk about Marawambi Pit, you'll see what I'm talking about. Thank you for being good across the group. Triton, 6,100 tons of copper metal. We always said the first Six months is sort of in line with what we've done in the last quarter. But in the second half, when we get the volume of tons coming from the Mara Pit, we'll see a significant increase in production. On the drilling side, big focus on Avoca tank. As you know, that is our highest grade ore body. We did intersect mineralization 400 milliliters below the current mineralization. So obviously there's something there. A lot more work needs to be done to test it, and we'll show you some of the pictures which we've seen. Krakow, in line with plan, although they had a few days off with power, they still managed to achieve their budgeted and internal plans on gold production and all the sustaining costs. So quite a good outcome for the Krakow team. We keep on doing work around the Western Valley field and you keep on finding, as I always said, Krakow has got a two-year life and it's always had a two-year life and you keep on extending and finding more. And once again, we added 20,000 ounces into the mine plan for Krakow as part of the review we're doing using the higher gold price and also looking at the peripherals around old workings. Holden Platter is an exciting opportunity. I'm not going to spend too much time on it. There's a slide on it, which we'll talk. And then, as I said earlier, the North Queensland assets, that process is moving quite well and we should have something pretty soon. If you look at the cash flow waterfall, so Triton and Krakow, good operating cash flows, quite a lot of money. So about $30 million of that capital exploration was growth capital. So About 25 has been spent on the Mara Pit and another 5 million on the tailings dam lift at Krakow. So, you know, we are investing back in the business to set it up for FY26, second half and 27. And then the other bits and pieces around finalising the cash flow, the cash at bank up from 28 to 32. Touching on Triton, as I said, 6,100 tonnes But something not to forget, if you look at that by-product credit line, that's $15 million in by-product credits from gold and silver. If you analyze that, that's more than $60 million worth over 12 months. So sometimes we forget about the value of those. I talked about the strip, $25 million, and really the diamond drilling and the exploration is the big focus. we've allocated over $10 million to exploration for Triton in this financial year. And the guys are on track to achieve about 80,000 meters of drilling in FY26. So this is just two photos. I think the key takeaway there is Samaraput is going well. The real, and I keep on talking about this, first six, second six, and that slide clearly show you that By January, we'll be in oil at the pit, and you're going to produce more oil than what you can process. That line is the capacity of the mill around 1.8 million tons. So there will be about 900,000 tons, which would be stockpiled and will be processed in FY27. So that's quite exciting. This is the first time the mill will run at full capacity for a long period of time, and we have done it in the last quarter, so we know the mill can do up to 1.82 million tons, and that would be what we were targeting for the second six. Constellation, as you all might know, this is the future for Triton. The mine designs has come back with bigger open-cut mines than we originally thought. We talked about that before. That is already close to 8 million ton ore body at over 2% copper and nearly 0.7 gold, so a lot of value in gold as well. The idea is we will... We will shortly put a maiden reserve out on the open cut for Triton. We've done some work, interesting results. There is an oxide cap on this. Now, we are doing test work to see if we can treat those oxides through the process plant. Because if you do a heap leach on oxides, you don't get your gold or your precious metals out. While if you put it through the plant, you might get lower copper recoveries. but you'll get most of your gold and silver out if it's there. So there's some work on that. And if that works, that will even be a stronger economic valuation for consolation. Because once you do a heap leach, you need to do rehab and there's all sorts of different things. So if you can truck it to the plant and process it, it might be a much stronger case. So the current designs is, open cut and then you go underground. Currently, we're thinking to go underground in year two. So there will be a few years where you will do open cut and underground at the same time. And as we know, it's still open in depth and you can see some of the bed scratch has been down the bottom. So we're working through those. Environmental approvals and permits are all underway and in process with a target date of starting this in, as I said earlier, quarter one FY27. On the exploration side, quite exciting results for Evoca Tank. You can see some of those holes, those two holes we drilled intersected mineralization quite deep, another 400 meters below current results. We are doing some EM surveys down those holes currently and to see where do we target the next round of drilling. So that's exciting. As you know, Evoca Tank is our highest grade all-body tank. At Krakow, once again, although the ounces are lower than the first June quarter, that is on plan. They achieved exactly what we expected them to do. They mined at times slightly lower grade, but we managed to, even though they had an outage, they still achieved their internal plans for Krakow. The TSF lift, so we're putting a new TSF lift in that's on target. That's actually ahead of schedule currently. And you can see there that growth capital in that table of $5.5 million is the cost for that tailings dam lift. The exciting opportunity, we announced it the other day and we talked about it. Golden Plateau is an old mining area which has been mined in the 1930s at over 10 gram a tonne. A lot of voids has been left. A lot of areas has been left behind because they're lower grade. In the 80s, someone put an open pit mine over it and mine close to 3 million tons or close to 3 gram a ton. The mineralization extends another 150 meters below that pit and also extends to the west. So we just will launch in November. We launched a new drilling program to test those and define the opportunity. And if this comes and it works, this can easily become a four or five year mine plan just on open gate mining, which will be a huge improvement from the historical two years life, but it's always been two years for forever. So this can be a real strong case for Krakow in terms of where do we go going forward. We also did an airborne magnetic and radiometric survey across the whole tenement package. That work is still underway, but it's really trying to define the drilling targets in the southern rain field. As we said before, that's going to be one of the target areas for exploration at Krakow in the next three quarters. On the project side, just a high-level summary. JAG is on care and maintenance. We incurred $2.1 million. That was all per plan. We are planning to drop that cost significantly in the next three quarters. And as we said before, focus on testing those base metal targets. The whole thing is, you know, we assessed it and made a clear decision that we will start this mine when we got a 10 plus year mine life. And to us, that makes a lot of sense. There's eight base metal targets. We allocated $3 million in this financial year to test those. And obviously, if you find something, you will really draw more. But it's really saying, let's create life before we even consider restarting the mine. At Stockman, the test work is finished. The processing option is completed. We're busy putting up, finishing off the models, and we will then decide what's the best way forward for those projects. And as I said earlier, North Queensland assets divestment is close to a position where we can announce it. So in terms of the corporate side, you can see an increase in In the closing cash balance, receivables slightly down with just the timing of concentrates. And the closing cash position at 32 is a strong position for us, considering that we've invested significant amount of money into growth capital to set it up for the second half of FY 2020 of 26. At the debt level, still unchanged at $40 million, it was Washington sold Patterson. It's a $50 million facility drawn to 40. That is due and payable in August next year. So from the current thinking and current forecast and plans, that we should generate significant cash from the business to make sure we can deal with the salt patch facility at the time. I... I guess that sort of summarized the quarter. I'm more than happy to take questions. So if anyone wants to put up their hand, I will unlock and you can ask your questions. Hey, David.

Morning, Andre. How are you? Good.

How are you doing?

Well, thank you very much. Nice quarter. Well done. You know, good costs and it was ahead of our expectations, so that was good to see. So, nice on there. Thank you. um just you've kind of answered this um in your comments but um you know you've added an extra digger at um um to with productivity there it sounds like uh now you're on track to uh get dirt into the mill like in january i've said that's uh so that sounds like a good outcome there yeah look that's sort of the whole focus there is you know get the priest please stop down as quickly as you can the more that we can bring it forward the better

So the plans are for it to be delivered in January and it's still on track to do that.

Excellent. And then I just thought on the December quarter in general, I mean, again, in your comments, you sort of said, yeah, it'd be sort of similar to the last couple of quarters. Will that sort of... you know, without the, without Mara, I think it's sort of stockpiles helping this quarter, will that sort of come from a lift at Tritton or a Volca tank? Can you just give us maybe a little bit more on where the dirt's coming from at Tritton in the December quarter?

Yeah, so look, a lot of the dirt is coming from a Volca tank. We've done some drilling at a Volca tank and it's realised that it also extends up the, so some of the stoves we will mine is actually stoves going high up in the ore body, then then down. So there's good volumes coming out of Avoca Tank and Bajigar, the two main producers for the quarter coming up.

Cool. And just on that Avoca Tank, I mean, you know, 400 metre down dip or outside resource extensions, obviously pretty encouraging start. I understand there will be a bit more drawings going to go and I have to go into this, but when should we maybe expect maybe a bit more visibility, I guess, on a formal kind of mine plan or resource or reserve update?

David, I think it would probably be in quarter three, early quarter four. We're doing the EM survey now and then that will direct us to the best area and And currently the turnaround of these samples takes forever. So there is a bit of a lag on some of those samples coming back. So I would say to be safe, I would say it would be end of quarter three, beginning quarter four.

Sure. But it does sound from what you just said also, it sounds like you've been able to find a bit more dirt in the back of the tank just with the grade control drilling. Is that sort of a fair understanding?

That's sort of the whole body. I don't know if you, I think you have been down there, but it is just one of the nature of that is as you do better, more great control during, you understand the structure better and you can mine mine a little better as you go through it. Um, so yeah, we are seeing some, some a bit better results coming out of both the things, the budget guy in itself is doing, doing quite well.

Cool. Thank you. Um, and, uh, finally for me, um,

grades are cracking a little bit lower this quarter should we should we expect them to pick up for the balance of that 526 or there would be there would be a little pick up but I mean if you look at the guidance yep it is around that 10,000 ounces if you go on average it was lower but it was we expected it to be lower so it will be slightly higher quarters coming up but overall you know that 10,000 or ounces a quarter is sort of the rough target knowing that this quarter was going to be lower, so there's a little bit more coming up in some of the quarters.

Excellent. Well, thanks very much, Andre. I'll pass it on.

Thanks, David. Paul, now to talk. Sorry, Paul. Hey, Andre. How are you doing? Good, thanks. How are you?

That's good. Not too bad. Not too bad. Thanks. Thanks for taking my questions. Just firstly on Triton and following on from Dave's questioning, you sort of finished that first phase of the Murrawambi pit. Second, the stage two pre-strip to complete this quarter with first orientation. in january so as you mentioned this quarter will have increased contributions from a voca tank but but from memory you're planning a mill shutdown this quarter as well so really the second quarter will likely be the softest before you sort of get that significant improvement in the second half is that is that correct

Look, it would be probably a little softer, but it's not materially softer. Most shutdowns are planned in the forecast in any way. So yeah, it might be slightly, but it's not going to be something material.

Okay, great. No, that's clear. And then just on Krakow, are you sort of seeing any sort of cost creep in this price environment where I guess you may be taking some more marginal material or are you really just trying to leverage your margins more there?

Look, there is a bit of, if you call it, cost creep on a unit basis because we are targeting areas with slightly lower grades purely because at this price it makes money. And the nature of that old body is that it's been mined historically and two gram a tonne dirt was left behind in the peripherals and we're now doing the assessment on all of those and If that makes sense, we do take it. So you'll see, like you say, the cost creep in terms of the unit cost, although the costs are all well controlled. But yeah, it's a conscious decision, you know, that mine in terms of creating life and looking at how do we create a better opportunity and create time. That is something we're consciously doing.

Yeah, that makes sense, especially considering the current life of mine. And you sort of touched on the extensions there in the Western Bainfield. I guess, how much longer does that extend things by?

Oh, look, that 20,000 ounces, you know, if we do 48,000 ounces, that's basically another six months. We have already, you know, the last few quarters extended. Last year, I think we added 60,000 ounces, so it just keeps doing the work. It's sort of where we are, and then as we mine, we find a lot of times find different new veins or new structures, but that's sort of what the life would be added.

Okay. Okay, and staying on Krakow, and you touched on Golden Plateau, but moving a bit further south, I know ground conditions are a bit tricky there, but any more work been done on potential drill program there targeting the southern vein field, or are you just waiting for a bit more free cash flow maybe in the second half of this financial year to have a crack at that?

So it's twofold. The one is just the surveys we just finished. We're waiting for those results to actually make sure we target the right areas. So we haven't got it back yet, but we've got some of it. So the guys will do the work to target and then we always plan to do the drilling only in the second half based on we should make significantly more cash and then we'll do it then. But they still need to do the technical work to really clearly define the target areas.

Okay. That's great. And then just lastly on hedging, as you sort of touched on, you've locked in some pricing there to get you through that growth phase at Triton with about sort of 16,000 ounces remaining on that program. Is that enough to get you through or are you thinking about doing a bit more maybe on top of what you've already done?

This market is always a challenging question. At this stage, we're not thinking of adding more. You know, even at the gold price where it is, even if it comes back, it's still better than where we locked it in. There's always opportunities, but at this stage, we sort of think there's more upside on the copper side. Gold, we just pulled back overnight, but no one really knows. But at this stage, we sort of at a group level decided we won't necessarily hedge more than 50% of our gold production.

Okay. No, that's clear. Thanks, Andre. That's it from me. I'll pass it on.

Thank you. Peter Cooper, I see your hands up. Let me just ask you a minute. Can you hear me, Peter?

Yes, I can hear you, Andre. Congratulations on a really, really solid quarter. It's nice to get some runs on the board. I've just got one question, two parts. Thinking about Dritton and thinking about Krakow, what are the main operational things for each site that you want to achieve in the current quarter that's going to lift us into a good second half?

All right. For Dritton, it's one thing, finish the pre-strip. that pre-strip and making sure we get into tons in January and fill that mold to max capacity from January onwards, that is critical. So for Triton, really focusing on that second quarter is important. At Krakow, finishing off the tailings dam lift is important. We need to have it done by the end of the year so that we don't impact production. That is all sort of in play to deliver so that there's no impact on any production. And then just ongoing success in the Western Wayne field in terms of the ongoing resource extensions. But that's not actually going to change the next six months. That's more year two and three onwards. So I think for Krakow, it's just, guys, keep doing what you're doing. You've been doing a great job for the last two years. Just keep doing what you're doing.

Thanks very much, Andre, and good luck.

All right. Thanks, Peter. I just want to see if there's any questions in the chat. No. I don't see any more hands. If there's nothing else, I'll give it another 30 seconds or so if anyone wants to ask another question. Otherwise, we'll sign off. Okay. In that case, everyone, thank you very much for joining the call and we'll talk in three months. Thank you.