Group 6 Metals Records Highest Quarterly Throughput Ahead of Underground Mining

Record Throughput and Production at Dolphin Mine

Group 6 Metals Limited (ASX:G6M) pushed its processing plant throughput to a new quarterly high, handling 72,351 tonnes of ore at the Dolphin Tungsten Mine in Q3 FY26. This output narrowly missed the previous record production of 26,175 MTU of tungsten trioxide (WO3) set in the prior quarter, finishing at 24,146 MTU. The average feed grade dipped to 0.56% WO3, down from 0.65% earlier in the year, reflecting ongoing processing of accumulated stockpiles ahead of the underground mining phase.

Monthly production showed a steady decline in average feed grade through the quarter, from 0.59% in January to 0.53% in March, yet the plant maintained consistent throughput, underscoring operational improvements. The company’s focus on processing existing stockpiles has delivered tangible benefits, as it prepares for the next phase of mining.

Ore Stockpiles and Underground Transition

At quarter’s end, Group 6 Metals reported ore stockpiles of approximately 362,000 tonnes averaging 0.30% WO3, equating to roughly 109,000 MTU of contained tungsten. These stockpiles represent about four quarters of production capacity, offering a buffer as the company transitions from open-pit to underground mining operations. The underground phase is slated to commence in Q1 FY27, with recent engagement of HMR Drilling Services marking a critical milestone in this transition.

This strategic shift is backed by a binding underground mining contract valued between $110 million and $120 million, which secures mining services for an initial three-year term. The contract’s fixed pricing through mid-2027 and employment of up to 95 workers at peak operations signal a significant ramp-up in activity and production potential for Group 6 Metals. This move aligns with the company’s broader plan to stabilise and grow its tungsten output amid a tightening global market.

Robust Financial Position and Cash Flow

Financially, Group 6 Metals strengthened its position considerably over the quarter, ending March 2026 with $14.4 million in cash and $2.5 million in undrawn loan facilities. Operating cash flow was robust at $13.2 million, driven by $25.2 million in customer receipts from tungsten concentrate sales totaling 24,555 MTU. This cash generation supports ongoing operations and capital expenditure programs critical to underground mine development.

The company’s debt profile remains manageable, with only $800,000 due within the next 12 months and access to bridging facilities from its Senior Lending Group that were not drawn upon during the quarter. These financial metrics represent a marked improvement from the previous year, reflecting operational discipline and market tailwinds.

Market Dynamics and Offtake Agreements

The tungsten market continues to exhibit structural tightness, driven by constrained supply, depleted inventories, and geopolitical factors such as US-China trade tensions and resource nationalism. These dynamics have elevated tungsten’s status as a critical mineral for defence and technology supply chains, underpinning a bullish outlook for prices amid ongoing volatility.

Group 6 Metals extended one of its key offtake agreements during the quarter, ensuring continued access to contracted sales channels and reinforcing revenue certainty. This extension is part of the company’s strategy to secure long-term partnerships while advancing its underground mining transition, further positioning it to capitalise on strong customer demand.

Safety and Governance Highlights

Safety remains a priority, with the company achieving 365 days without a lost time injury (LTI) on 19 March 2026 before recording one LTI later in the quarter. No environmental incidents were reported. The company disclosed payments totaling $576,564 to related parties, primarily for equipment rental and services, conducted under arm’s length terms.

As Group 6 Metals advances its operational and financial recovery, it is also working toward reinstatement on the ASX. The company signalled that further information on this process will be forthcoming in the coming weeks, a key event for shareholders and market watchers.

Operationally and financially, Group 6 Metals is building momentum, leveraging its record throughput and strong cash flow to underpin the next phase of growth at the Dolphin Tungsten Mine. The company’s recent underground mining contract and offtake agreement extension are tangible markers of this progress, setting the stage for what could be a transformative period in tungsten production on King Island.