Aurelia Metals delivered a robust December quarter, marked by strong cash flow, increased metal output, and the successful processing of its first ore from the Federation mine, underpinning its FY25 guidance.
- Group metal production rose to 11,000oz gold with reduced all-in sustaining costs of $1,860/oz
- First concentrate production from Federation ore achieved with excellent recovery rates
- Peak mine development and ore mined increased, driving operational efficiencies
- Cash balance remained strong at $96.7 million despite growth capital investments
- Sustainability metrics improved with a 45% reduction in total recordable injury frequency rate
Strong Operational Momentum at Peak and Federation
Aurelia Metals Limited (ASX: AMI) has reported a solid quarterly performance for the three months ending 31 December 2024, continuing its trajectory of operational improvement and financial discipline. The company produced 11,000 ounces of gold alongside significant quantities of copper, zinc, and lead, while reducing its all-in sustaining costs (AISC) to $1,860 per ounce, down from $2,321 in the previous quarter.
The Peak mine remains the cornerstone of Aurelia’s production profile, with mine development metres increasing by 26% to 915 metres and ore mined rising to 152,000 tonnes. This ramp-up has contributed to lower unit mining costs of $112 per tonne, a notable improvement from $129 per tonne in the prior quarter. Plant recoveries also held steady, with zinc and lead recoveries at 78.6% and 91.5% respectively, supporting the company’s ongoing Peak Expansion project.
Federation Mine: A Key Growth Catalyst
Aurelia marked a significant milestone with the first concentrate production from the Federation mine ore, processed through the Peak plant. The 16,500-tonne processing campaign delivered excellent throughput and recovery outcomes, with zinc and lead recoveries exceeding 85% and gold recovery at 94.4%. This successful integration of Federation ore validates the company’s strategy to diversify its feed sources and enhance base metals output.
Mine development at Federation accelerated by 41% to 873 metres, ahead of plan, supported by infrastructure upgrades including power enhancements and ventilation improvements. The company is progressing an application to increase ore haulage capacity between Federation and Peak from 200,000 to 600,000 tonnes per annum, with a decision expected in the second half of FY25.
Financial Strength and Cost Management
Despite investing $18.8 million in growth capital at Federation and acquiring two new underground trucks, Aurelia maintained a healthy cash balance of $96.7 million. Operating cash flow from Peak increased to $20.6 million, driven by higher gold, zinc, and lead sales, partially offset by lower copper sales. Operating costs fell 9% to $40.9 million, reflecting efficiencies in processing and logistics.
The company’s FY25 production and cost guidance remains unchanged, with expectations that AISC will trend downwards as operational improvements take hold. Exploration expenditure rose to $2.7 million, supporting ongoing drilling programs across the Cobar and Nymagee districts aimed at extending mineralisation and increasing resource inventory.
Sustainability and Community Engagement
Aurelia’s commitment to safety and environmental stewardship is evident in a 45% reduction in the total recordable injury frequency rate (TRIFR) and stable environmental incident frequency rates. The company also officially opened its Community Hub in Cobar, enhancing local engagement and transparency around its operations and growth plans.
Looking ahead, Aurelia is focused on sustaining its operational momentum, advancing mine development, and unlocking value from its polymetallic assets while maintaining financial discipline and community partnerships.
Bottom Line?
Aurelia’s successful Federation ore integration and operational gains at Peak set the stage for a potentially stronger FY25, but execution risks remain as production scales.
Questions in the middle?
- How will the planned increase in ore haulage capacity between Federation and Peak impact production volumes and costs?
- What are the implications of the revised orebody model at Federation for future mine planning and capital expenditure?
- Can Aurelia sustain its downward trend in all-in sustaining costs amid fluctuating metal prices and operational scaling?