Alkane Resources Posts Record $93 Million Profit on Surge in Gold and Antimony Output

Record Profit and Revenue Driven by Mandalay Acquisition

Alkane Resources (ASX:ALK) posted a landmark third quarter profit of $93 million, more than 11 times the $8.1 million earned in the same period last year. The surge stems from a combination of increased production, higher realised gold and antimony prices, and the full integration of the Mandalay Resources acquisition completed in August 2025. Revenue for Q3 2026 soared to $274 million, up from $63.2 million in Q3 2025, underscoring the transformative impact of the merger.

EBITDA reached a record $161 million, with operating cash flow matching that figure, reflecting exceptional cash generation capability. The company's balance sheet remains robust, closing the quarter with $374 million in cash, bullion, and liquid investments, providing ample runway for growth initiatives.

These results build on Alkane's recent momentum, highlighted by its entry into the S&P/ASX 200 index earlier this year, a milestone that enhances its market profile and investor appeal. The company’s strong cash position was further bolstered by securing a $110 million revolving credit facility and a $40 million contingent instrument facility with major Australian banks, completed shortly after quarter-end, reinforcing financial flexibility for expansion and exploration.

Operational Excellence Across Three Mines

Alkane’s three-mine portfolio delivered a combined gold equivalent production of 45,776 ounces in Q3 2026, a substantial increase from 17,657 ounces in Q3 2025. This includes 21,652 ounces from Tomingley in New South Wales, 12,433 ounces from Björkdal in Sweden, and 11,691 gold equivalent ounces (including 377 tonnes of antimony) from Costerfield in Victoria. The production mix reflects the successful integration of Mandalay’s assets and ongoing operational improvements.

Tomingley’s throughput benefited from the addition of a mobile crusher, boosting milling rates to approximately 1.3 million tonnes per annum and improving mill head grades through recent plant upgrades. Despite minor stope performance setbacks, underground mining volumes remained strong. Cash operating costs at Tomingley slightly decreased to $2,021 per ounce, while all-in sustaining costs fell to $2,444 per ounce, aided by higher production and lower sustaining capital outlays.

At Costerfield, ore mining and milling rates exceeded plans, though grade variability presented challenges. The operation focused on drill and blast optimisation and capital development to enhance recovery and reduce dilution. Successful pre-crushing trials improved throughput and blend control. Site cash costs decreased to $1,597 per gold equivalent ounce, while AISC rose to $2,521 due to increased sustaining capital, including $7.1 million in underground development.

Björkdal delivered consistent mining performance with mined grades aligning with plans and sustained capital development well above target. Gold production rose significantly to 12,433 ounces, with cash operating costs improving to $2,506 per ounce and AISC declining to $3,699 per ounce. Exploration drilling progressed on multiple fronts, including infill and growth targets, supporting resource expansion.

Sustained Investment and Exploration Drive Growth

Capital expenditure in Q3 2026 totaled $46.9 million, a sharp increase over $13.1 million in Q3 2025, driven by the Mandalay acquisition and growth projects. Notably, $10 million was invested in the Newell Highway realignment at Tomingley, slated for completion in early 2027. Exploration spending reached $12.5 million, split across Costerfield, Björkdal, and non-operational drilling in New South Wales, with high-grade intercepts reported, including assays up to 267.5 g/t gold and 19.8% antimony at Costerfield’s Kendall program.

The company reaffirmed its FY2026 guidance, targeting 155,000 to 168,000 gold equivalent ounces at an all-in sustaining cost range of $2,600 to $2,900 per ounce. This outlook reflects confidence in operational execution and commodity price assumptions, with the Mandalay assets now fully contributing to production and cash flow.

Financial Position Strengthened by Merger and Credit Facilities

The Mandalay acquisition, accounted for as a business combination, added substantial assets and liabilities, including $142 million in cash and significant property, plant, and equipment valued at $389 million. The transaction was settled through the issuance of approximately 759 million Alkane shares, expanding the register to over 1.36 billion shares.

Alkane’s net cash position stood at $307 million after deducting $20 million in debt facilities, including equipment loans at Björkdal and Tomingley. The company fully repaid its $45 million Macquarie project loan in August 2025, improving financial flexibility. The new $150 million syndicated credit facilities, arranged with four major Australian banks, provide additional liquidity to support ongoing development and exploration activities.

Gold forward sales and put option contracts remain in place to hedge a portion of anticipated production, with 61,224 ounces of put options outstanding at Tomingley and 31,500 ounces at Björkdal, reflecting prudent risk management amid gold price volatility.

Exploration Highlights Signal Resource Upside

Exploration drilling at Tomingley uncovered a gold-bearing seismic reflector beneath the Roswell deposit, with high-grade underground intercepts including 31 g/t gold over 5.9 meters. Near-mine prospects such as El Paso are being reinterpreted for further drilling. At Costerfield, the Kendall program identified 25 veins immediately above current orebodies, with impressive gold and antimony grades, while Björkdal continued infill and growth drilling targeting extensions of the Main, Central, and Storheden zones.

These exploration efforts complement the company’s development projects, including the Boda-Kaiser gold-copper porphyry project in New South Wales, positioning Alkane for sustained resource growth and production longevity.

Alkane’s operational and financial results are detailed in its latest quarterly report, which also includes a webcast and conference call with management to discuss the quarter’s performance and outlook. The company’s strong momentum following the Mandalay acquisition and disciplined capital management underpin its confidence in meeting full-year targets and advancing its growth pipeline.

Investors may find it instructive to compare these results with the company’s recent record quarterly production and strengthened liquidity position, which together illustrate Alkane’s evolving scale and operational resilience.