Lefroy Exploration Achieves First Gold Production and Confirms Resource Growth

Transition to Producer with First Gold from Lucky Strike

Lefroy Exploration Limited (ASX:LEX) has hit a pivotal milestone, officially becoming a gold producer with the first gold poured from its Lucky Strike Gold Mine during the March quarter. The initial toll milling campaign processed 31,796 dry tonnes at a reconciled head grade of 1.42 g/t Au, recovering 1,392 ounces of gold with an impressive 96.2% recovery rate. This maiden production validates the company's mineral resource estimates and mining controls, with positive reconciliation reported both from mine claim to mill and resource to mine claim grades.

The Lucky Strike deposit holds a total Mineral Resource Estimate (MRE) of 1.27 million tonnes at 1.95 g/t gold for 79,600 ounces, split evenly between Indicated and Inferred categories. Under a profit-sharing agreement with BML Ventures Pty Ltd, Lefroy and BML each hold a 50% stake, with BML responsible for mining operations and funding upfront costs. Revenues from the first toll milling parcel have been applied to repay a substantial portion of these costs, setting the stage for future cash flows to be shared equally.

Ore stockpiles at Lucky Strike have grown to 13,069 tonnes, supporting plans to secure further toll milling slots for an additional 250,000 tonnes. This operational ramp-up positions Lefroy to capitalise on its low-cost production strategy as it seeks to unlock value for shareholders.

Exploration Drilling Highlights Expansion Opportunities

Beyond production, Lefroy is aggressively pursuing resource growth. Recent grade control drilling at Lucky Strike South has revealed strong potential for a Stage 2 South Pit, with significant gold intersections well outside existing resource boundaries. Assay highlights include 16m at 3.39 g/t gold and 3m at 7.18 g/t gold, underscoring the prospect of expanding the mine's footprint and extending mine life.

Meanwhile, drilling at the Burns Gold Project, part of Lefroy’s broader portfolio, has confirmed untested growth potential within the high-grade Burns Central deposit. A reverse circulation drilling program returned encouraging results such as 5m at 1.6 g/t gold, validating the geological model and indicating mineralisation extending northwards. Lefroy has also completed diamond drilling and metallurgical test work at Burns, with full metallurgical results expected early in the June quarter.

These exploration efforts complement Lefroy’s resource base, which includes the 439,000-ounce Mt Martin deposit, currently targeted for a 4,000-metre drilling campaign aimed at resource expansion and an imminent resource update. The combined resource base exceeds one million ounces, offering a substantial platform for future development.

Financial Position Supported by BML Ventures Facility

On the financial front, Lefroy has strengthened its cash position through the third $0.5 million cash advance from BML Ventures under a $2.5 million Profit Cash Advance Facility. As at 31 March 2026, the company held $1.42 million in cash with no debt. Operating cash outflows of $507,000 and investing outflows of $361,000 were largely funded by this facility, which carries an 8% fixed interest rate and matures at the end of 2026.

Lefroy expects to continue funding operations through cash inflows generated by Lucky Strike, with revised mine schedules and growing ore stockpiles anticipated to yield surplus cash beyond amounts advanced by BML. This dynamic provides a pathway for the company to sustain its exploration and development activities without immediate equity dilution.

The appointment of Graeme Gribbin as Managing Director in February 2026, following his tenure as CEO, brings leadership continuity as Lefroy navigates this transition from explorer to producer and pursues growth across its portfolio.

These developments build on Lefroy’s recent progress, including the commencement of mining and toll milling at Lucky Strike, and the positive drilling results supporting resource growth, as detailed in the company’s earlier announcements. Notably, the company’s first gold production and strong drilling results were highlighted in its recent quarterly updates, reinforcing confidence in its operational and exploration strategy.