Can Brightstar Sustain Growth Amid Rising Costs and Operational Challenges?
Brightstar Resources reports underground mining operations at its Laverton Hub are significantly ahead of schedule, targeting a +50% quarter-on-quarter production increase in the September quarter. The Fish Mine has turned cash flow positive, underpinning a robust growth outlook.
- Second Fortune and Fish mines on track for +50% production growth in September quarter
- Monthly group gold production forecast at 2,400–2,800 ounces with AISC of A$3,800–4,000/oz
- Fish Mine generates positive free cash flow since July after $17M capex investment
- Processing through Genesis’ Laverton Mill exceeds budget with improved grade and recovery
- Ongoing drilling programs targeting mine life extensions and resource upgrades
Production Momentum Accelerates at Laverton Hub
Brightstar Resources Limited (ASX – BTR) has revealed a strong operational performance at its Laverton Hub, with underground mining at the Second Fortune and Fish mines advancing ahead of schedule. The company is targeting a remarkable +50% quarter-on-quarter production growth in the September quarter, reflecting the successful ramp-up of mining activities and improved operational efficiencies.
The group’s monthly gold production outlook is now set between 2,400 and 2,800 ounces, translating to an annualised run rate of approximately 29,000 to 34,000 ounces. This production is expected to be delivered at an all-in sustaining cost (AISC) ranging from A$3,800 to A$4,000 per ounce, positioning Brightstar competitively within the mid-tier gold mining sector.
Fish Mine Emerges as a Key Cash Flow Driver
The Fish Mine has been a standout performer, reaching a significant milestone by generating positive free cash flow in July, just months after capital expenditure of around $17 million. This early cash flow generation marks the bottom of the capital “J-curve” and signals Fish’s transition into a consistent and meaningful contributor to Brightstar’s financial health.
Mining operations at Fish are progressing ahead of schedule, with stoping activities underway and development reaching steady-state performance. The mine’s infrastructure is now fully established, enabling accelerated ore production and supporting the company’s growth ambitions.
Processing Excellence and Grade Improvements
Brightstar’s third processing parcel through Genesis Minerals’ Laverton Mill in August surpassed expectations, with 52,000 tonnes processed at a grade of 2.68 grams per tonne and a recovery rate of 91.3%, resulting in 4,067 ounces recovered. This performance represents a 58% increase in reconciled grade compared to the previous campaign, driven by an increased proportion of higher-grade underground ore from Second Fortune and Fish.
Looking ahead, the company anticipates the grade profile to improve further to above 3.0 grams per tonne as ore feed becomes exclusively sourced from its underground operations, enhancing both production quality and financial returns.
Exploration and Growth Prospects
Brightstar is actively pursuing mine life extensions through substantial surface and underground drilling programs at both Second Fortune and Fish. These programs aim to convert inferred mineral resources into measured and indicated categories, thereby supporting future mine plan expansions. Recent exploration has identified promising extensions to the FTV vein at Second Fortune, potentially increasing the mine’s ounces-per-vertical-metre endowment and improving operational metrics.
The company also continues its broader exploration efforts at the Sandstone Gold Project and Menzies Gold Project, with results from recent drilling expected in the coming weeks. These initiatives underpin Brightstar’s staged growth strategy and ambition to become a leading mid-tier gold producer.
Operational Excellence and Safety
Operational improvements at Second Fortune have been notable, with production outperforming budget in six of the past seven months. The company has also maintained an excellent safety record, achieving over 1,795 days without a lost time injury (LTI), reflecting a strong safety culture across its operations.
Brightstar’s Executive Director of Operations, Andrew Rich, highlighted the dedication of the operations teams and the positive outlook for steady-state production rates, reinforcing confidence in the company’s near-term growth trajectory.
Bottom Line?
Brightstar’s operational strides at Laverton set the stage for sustained growth, but upcoming drilling results will be pivotal in confirming long-term production potential.
Questions in the middle?
- Will assay results from recent drilling confirm extensions to mineral resources and support mine life extensions?
- How will sustained production growth impact Brightstar’s financial metrics and cash flow generation in FY26?
- What risks could affect the company’s ability to maintain targeted all-in sustaining costs amid rising production?