Vault’s Deflector Owner Mining Shift May Cause Short-Term Production Volatility

• Q1 gold production of 92,087 ounces at AISC of A$2,613/oz
• 31% increase in group ore reserves post FY25 depletion
• King of the Hills processing plant upgrade on track to boost capacity by ~50%
• Transition to owner operator mining underway at Deflector underground
• Underlying free cash flow of A$28.1 million and $703 million cash and bullion

Robust Quarterly Production and Financial Performance

Vault Minerals Limited (ASX – VAU) has reported a solid start to FY26 with gold production reaching 92,087 ounces in the September quarter. Sales closely followed at 91,477 ounces, achieved at an average realised price of A$4,446 per ounce. The company maintained a competitive all-in sustaining cost (AISC) of A$2,613 per ounce, reflecting operational discipline across its key assets.

The quarter’s performance aligns well with Vault’s FY26 guidance of 332,000 to 360,000 ounces at an AISC range of A$2,650 to A$2,850 per ounce, positioning the company on track to meet its production and cost targets.

Operational Highlights Across Core Regions

At Mount Monger, production was 22,809 ounces with an AISC of A$2,705 per ounce, supported by increased ore mined from the Santa Open Pit Complex despite lower underground grades. The Deflector Region delivered 22,767 ounces of gold and 115 tonnes of copper, with a notable record quarterly mine production at Rothsay, where both tonnes and grade improved significantly quarter-on-quarter. Leonora led the group with 46,511 ounces produced, bolstered by a record throughput of 1.47 million tonnes at the King of the Hills (KoTH) processing facility.

Importantly, Vault has commenced the transition to owner operator mining at Deflector underground, investing $11.5 million in new mining fleet during the quarter. This strategic shift is expected to enhance operational control and reduce costs over time, although some short-term production softness is anticipated during the transition period.

Growth Initiatives and Reserve Expansion

Vault is advancing its growth agenda with KoTH Stage 1 and 2 processing plant upgrades progressing on schedule and budget. These upgrades aim to increase throughput capacity by approximately 50% to between 7.5 and 8.0 million tonnes per annum by Q2 FY27, a significant boost that will underpin future production growth.

The company also reported a 31% increase in group ore reserves to 4.0 million ounces after accounting for FY25 mine depletion, underscoring the success of its exploration and resource definition programs. Exploration drilling is accelerating, particularly in the Leonora district, where a 100% increase in resource definition drilling is planned for FY26, targeting both extensions of known mineralisation and new areas.

At Sugar Zone, surface drilling has recommenced targeting extensions south of the recent Sugar South discovery, following encouraging channel sampling results that revealed visible gold in quartz veins.

Strong Financial Position and Shareholder Returns

Vault generated underlying free cash flow of A$28.1 million for the quarter, after investing A$94.1 million in growth capital and exploration. The company ended the quarter with a robust cash and bullion position of A$703.3 million, excluding gold in circuit and concentrate inventories, and remains debt-free.

In addition, Vault initiated a share buyback program, deploying A$9.3 million to repurchase 14.4 million shares, signaling confidence in the company’s value and future prospects. The upcoming Annual General Meeting will consider a 6.5 – 1 share consolidation, which may further enhance shareholder value.

Hedge Book Nearing Extinguishment

Vault’s hedge book stands at 98,087 ounces to be delivered over the next 12 months at an average forward price of A$2,850 per ounce. With 41% of these ounces scheduled for delivery in Q2 FY26, the company is rapidly approaching a significant inflection point. Post FY26, Vault expects to be largely unhedged, positioning it to benefit fully from rising gold prices and generate transformational free cash flow growth in FY27.

Bottom Line?

Vault Minerals is poised for a pivotal year ahead as production scales, costs are managed, and growth projects unlock new value.

Questions in the middle?

• How will the transition to owner operator mining at Deflector impact production and costs in the near term?
• What exploration results can be expected from the expanded drilling programs in Leonora and Sugar Zone?
• How will the near extinguishment of the hedge book influence Vault’s free cash flow and share price momentum?