Ora Banda Mining Posts 39% Production Surge and $38.5M Free Cash Flow

Record Production Milestone

Ora Banda Mining Ltd (ASX, OBM) has kicked off FY26 with a bang, announcing a record quarterly gold production of 30,595 ounces. This represents a 39% increase compared to the previous quarter, a surge largely attributed to the ramp-up at the Sand King underground mine and additional output from third-party milling arrangements.

The company’s ability to boost production so significantly underscores the success of its operational strategies, including improvements at the Davyhurst processing plant. These enhancements have increased throughput and recovery rates, enabling Ora Banda to capitalize fully on the rising gold price environment.

Strong Financial Performance and Liquidity

Alongside production gains, Ora Banda reported a record free cash flow of $38.5 million for the quarter, pushing its closing cash balance to a robust $122.7 million. This liquidity position is further bolstered by a $50 million revolving credit facility, providing the company with over $170 million in total available funds.

However, the cash figure is net of $7.4 million spent on put option premiums, a strategic move to hedge against gold price volatility. These options cover 33,332 ounces through to October 2026 at an average exercise price of A$5,013 per ounce, reflecting a cautious but confident approach to managing market risk.

Outlook and Growth Prospects

Looking ahead, Ora Banda forecasts continued quarter-on-quarter production growth for the remainder of FY26, driven by ongoing expansion at Sand King. The company is also reinvesting heavily in organic growth initiatives, including drilling programs and infrastructure upgrades, signaling a commitment to sustaining and enhancing its operational momentum.

While the company is progressing towards finalizing a binding Ore Sale Agreement with Norton Gold Fields, some conditions remain outstanding, introducing a degree of uncertainty. Nonetheless, the current trajectory suggests Ora Banda is well-positioned to maintain its upward production and cash flow trends.

Management Perspective

Managing Director Luke Creagh highlighted the quarter’s results as a testament to the team’s efforts in bringing Sand King online and optimizing plant performance. He emphasized the balance between generating strong cash flows and reinvesting in the business to fuel future growth, a strategy that could underpin sustained shareholder value creation.