Evolution Mining has reported a stellar December quarter, delivering record cash flow and reaffirming its FY26 production targets with improved cost efficiency. Despite a weather disruption at Ernest Henry, the company’s operations and growth projects remain on track.
- Record operating mine cash flow of $1.1 billion, up 57% quarter-on-quarter
- Net mine cash flow doubles to $727 million, driven by strong contributions across all sites
- FY26 production guidance maintained at 710-780koz gold and 70-80kt copper
- All-in Sustaining Cost guidance improved by 6% to $1,640-$1,760 per ounce
- Gearing reduced to 6% with cash balance nearing $1 billion and no debt repayments until 2028
Record Cash Flow Momentum
Evolution Mining Limited has delivered a remarkable December 2025 quarter, posting record operating mine cash flow of $1.1 billion, a 57% increase from the previous quarter. This surge reflects the company’s ability to capitalise on rising metal prices while maintaining operational discipline. Net mine cash flow doubled to $727 million, underscoring strong performances across key assets including Cowal, Mungari, Ernest Henry, Northparkes, Red Lake, and Mt Rawdon.
Operational Resilience Amid Weather Challenges
The quarter was not without challenges. Ernest Henry experienced a severe weather event with approximately 300mm of rainfall in 24 hours, causing water ingress and a temporary suspension of underground operations. Fortunately, all personnel were safe, and recovery efforts are progressing well. The incident is expected to reduce FY26 production by 7-8koz of gold and 4-5kt of copper, with minimal long-term impact anticipated.
On Track for FY26 Production and Cost Targets
Despite the weather disruption, Evolution remains confident in meeting its FY26 production guidance of 710,000 to 780,000 ounces of gold and 70,000 to 80,000 tonnes of copper. The company has also upgraded its All-in Sustaining Cost (AISC) guidance to $1,640-$1,760 per ounce, a 6% improvement from original estimates. This reflects effective cost control measures and higher by-product credits, reinforcing Evolution’s position as one of the industry’s lowest-cost producers.
Strong Balance Sheet and Minimal Hedging
Evolution’s balance sheet strength continues to improve, with gearing reduced to 6% from 11% in the prior quarter and a cash balance of $967 million. Notably, the company has no debt repayments due until November 2028, providing significant financial flexibility. Hedging remains minimal, with 98% of gold sold at spot prices and no copper hedging, allowing shareholders to benefit fully from current metal price increases.
Growth Projects and Exploration Progress
Key growth initiatives are advancing on schedule. The Cowal Open Pit Continuation project reached a major milestone with the completion of the northern protection bund, while the Ernest Henry Bert Pre-Feasibility Study and Northparkes E22 Study are set for Board review in the March 2026 quarter. Exploration spend of $10 million in the quarter included strategic acquisitions near Ernest Henry, enhancing future growth options and utilising latent milling capacity.
Safety and Sustainability
Safety performance remains stable with a low Total Recordable Injury Frequency (TRIF) of 5.8, reflecting Evolution’s ongoing commitment to operational discipline and workforce wellbeing.
Bottom Line?
Evolution Mining’s robust cash flow and cost improvements position it well for FY26, but weather risks and commodity price volatility remain watchpoints.
Questions in the middle?
- How will Ernest Henry’s recovery timeline affect full-year production and costs?
- What impact will minimal hedging have if metal prices fluctuate sharply?
- When will the Board decide on the Ernest Henry Bert and Northparkes E22 projects, and what are the implications?