How Westgold’s Karora Merger Fueled Record Gold Production and a 3c Dividend

A Transformational Year for Westgold

FY25 marked a watershed moment for Westgold Resources Limited, as the company completed its merger with Karora Resources, propelling it into the ranks of Australia’s top five gold producers. This strategic consolidation expanded Westgold’s footprint across Western Australia’s prolific Murchison and Southern Goldfields regions, significantly enhancing its operational scale and resource base.

The merger not only broadened Westgold’s asset portfolio but also delivered immediate operational benefits. The company reported record gold production of 326,384 ounces, a 44% increase from the previous year, achieved at an all-in sustaining cost (AISC) of A$2,666 per ounce. This performance was underpinned by ramp-ups at key mines such as Bluebird-South Junction and the restart of the iconic Great Fingall mine.

Financial Performance and Balance Sheet Strength

Westgold’s revenue nearly doubled, climbing 90% to A$1.36 billion, reflecting both higher production volumes and a buoyant gold price environment. However, profit after tax declined by 63% to A$34.8 million, primarily due to significant acquisition and integration costs associated with the Karora merger. Despite this, the company closed the year with a robust balance sheet, boasting A$364 million in cash, bullion, and liquid investments, complemented by a newly expanded $300 million syndicated facility, providing ample liquidity for growth initiatives.

The company remains fully unhedged, offering shareholders full exposure to the prevailing record-high gold prices, a strategic choice that aligns with its growth ambitions and market outlook.

Operational Highlights and Growth Prospects

Operationally, Westgold made significant strides. The Bluebird-South Junction mine demonstrated strong throughput growth, positioning it for steady-state production exceeding 1 million tonnes per annum by FY26. The Great Fingall mine’s restart is expected to contribute high-grade ounces, while the maiden 2.3 million ounce mineral resource estimate at Beta Hunt’s Fletcher Zone underscores the long-term potential of the Southern Goldfields assets.

Capital investment remained substantial, with $293 million deployed across mine properties, development, and exploration, including $43 million dedicated to resource growth programs. The company’s commitment to safety yielded a 17% reduction in total recordable injury frequency rate (TRIFR), reflecting a strong safety culture amid expansion.

Shareholder Returns and Executive Remuneration

In line with its capital management strategy, Westgold declared a final unfranked dividend of 3 cents per share, amounting to approximately $28.3 million, signaling confidence in its financial position and future cash flow generation. The shares will trade ex-dividend on 11 September 2025, with payment scheduled for 10 October 2025.

Executive remuneration was adjusted to remain competitive within the mining sector, with the Managing Director’s fixed remuneration increased by 42%. Short-term and long-term incentive outcomes reflected operational performance, with STI payouts at 80-92.5% and LTI vesting at 84%, balancing reward with accountability.

Looking Ahead

Westgold’s leadership emphasizes sustainable, high-margin production growth, leveraging its expanded asset base and processing infrastructure. Exploration will continue to be a priority to extend mine lives and unlock new value, while operational efficiencies will be pursued to maintain profitability across gold price cycles.