Westgold’s Q2 FY25 Gold Output Hits 80,886oz at A$2,703/oz AISC, Net Cash Flow $45M
Westgold Resources Limited achieved record gold production of 80,886 ounces in Q2 FY25, driving a robust net mine cash flow of $45 million and securing a $200 million corporate facility to fuel growth.
- Record quarterly gold production of 80,886 ounces at $2,703/oz AISC
- Net mine cash flow increased to $45 million, funding operational and growth capital
- Expanded Mineral Resources and Ore Reserves at Bluebird-South Junction and Starlight
- Secured $200 million corporate facility, totaling $300 million available without mandatory hedging
- Safety improvements with a 7% reduction in Total Recordable Injury Frequency Rate
Operational Milestone
Westgold Resources Limited has reported a landmark quarter ending December 2024, with gold production reaching a record 80,886 ounces, an increase from 77,369 ounces in the previous quarter. This production surge was achieved at an all-in sustaining cost (AISC) of A$2,703 per ounce, reflecting the company's ongoing focus on cost efficiency despite the integration of Southern Goldfields assets.
The net mine cash flow of A$45 million underscores Westgold's ability to generate strong operational cash, which is being reinvested into both sustaining and growth capital projects. The company’s strategic drawdown of A$50 million from its expanded corporate facility during the quarter further supports working capital needs as the business scales.
Exploration and Resource Development Progress
Westgold continues to aggressively expand its resource base, operating 17 drill rigs across its portfolio. Notably, the Bluebird-South Junction resource has grown to 1.4 million ounces with an Ore Reserve of 573,000 ounces, while the Starlight Mineral Resource surged by 91%, underpinning plans to expand the Fortnum operation.
High-grade drill results from both the Murchison and Southern Goldfields regions, including impressive intercepts such as 68 meters at 5.48 g/t Au at South Junction and 5.65 meters at 360.84 g/t Au at Starlight, highlight the quality and potential longevity of Westgold’s assets.
Strategic Growth and Financial Strength
The company’s recent ore purchase agreement with New Murchison Gold Limited is set to increase feed to the Bluebird mill from FY26, enhancing production flexibility and cost efficiency. Westgold’s balance sheet is bolstered by a $300 million corporate facility, including a new $200 million tranche secured without mandatory hedging, allowing full exposure to rising gold prices.
Westgold remains fully unhedged, capitalizing on the current gold price environment, which saw an achieved price of A$4,066 per ounce in the quarter, contributing to revenue of A$353 million.
Safety and Sustainability
Safety performance improved with a 7% reduction in the Total Recordable Injury Frequency Rate to 6.85 per million hours worked, and zero lost time injuries recorded. The company also reported no significant environmental incidents, reflecting its commitment to responsible mining practices.
Outlook
Westgold’s management emphasizes that the current quarter’s results mark the first full quarter post-merger with Karora Resources, with operational outputs steadily increasing. Capital investments are focused on critical infrastructure upgrades at Beta Hunt and Bluebird-South Junction to support a targeted production run rate exceeding 2 million tonnes per annum by late 2025.
The Fortnum expansion scoping study projects a 10-year mine life with increased milling capacity and robust financial returns, signaling a promising growth trajectory. The company’s disciplined treasury management and strategic asset reconfiguration aim to deliver higher free cash flow and shareholder returns in the coming years.
Bottom Line?
Westgold’s record production and strengthened balance sheet position it well to capitalize on rising gold prices, but operational ramp-ups and resource model updates remain key to sustaining momentum.
Questions in the middle?
- How will Westgold manage operational challenges at Beta Hunt to meet production targets?
- What impact will the new $200 million corporate facility have on Westgold’s growth projects and capital allocation?
- How will ongoing resource model updates affect grade reconciliation and mine planning in the Southern Goldfields?