EQ Resources Posts Record Revenue and Cash Flow in Q4 FY2026; Approves A$39 Million Mt Carbine Expansion
EQ Resources delivered a breakout quarter with A$79 million revenue and A$22.5 million operating cash flow, driven by a 176% production surge at Mt Carbine and soaring tungsten prices. The company greenlit a major expansion to double crushing capacity, targeting commissioning in Q3 FY2027.
- Record A$79 million revenue and A$22.5 million operating cash flow
- Mt Carbine production up 176% to 13,050 mtu
- A$39 million Mt Carbine expansion project approved
- Barruecopardo mining resumes after severe rain event
- Strong tungsten prices sustain market advantage
Record Revenue and Cash Flow Surge on Production and Price Strength
EQ Resources Limited (ASX:EQR) posted a remarkable Q4 FY2026, generating a record A$79 million in revenue, a 140% jump from the prior quarter, and A$22.5 million in operating cash flow. This surge was fuelled by a 176% increase in tungsten production at Mt Carbine, reaching 13,050 metric tonne units (mtu), alongside a structurally tight global tungsten market that saw prices soar by 559% year-on-year to US$2,900/mtu.
The company’s cash on hand swelled to A$28 million, supported by A$17 million in accounts receivable, reflecting robust sales and operational momentum. However, revenue figures include a potential US$12.2 million invoice adjustment under negotiation with a customer, introducing some near-term uncertainty.
Mt Carbine’s Expansion and Operational Breakthrough
Mt Carbine emerged as the star performer, with mining activity intensifying as crews accessed the high-grade Iolanthe vein system. Material blasted more than doubled to 1.17 million tonnes, with ore mined soaring 166% to 254,642 tonnes. The strip ratio improved significantly to 3.2:1, reflecting a higher ore-to-waste ratio as mining progressed deeper.
Processing throughput increased, despite some crusher reliability challenges, with gravity plant feed grade climbing to 0.258% WO₃. Recovery rates held steady at 68%, slightly below the previous quarter’s 77%, impacted by workforce constraints late in the period.
In June 2026, the board approved a A$39 million Mt Carbine Expansion Project to double crushing capacity from ~1 Mtpa to ~2 Mtpa. The upgrade aims to automate and integrate crushing, screening, ore sorting, and product handling, reducing material handling eightfold. Commissioning is targeted for Q3 FY2027, funded from existing cash reserves and operating cash flow.
Barruecopardo Recovers After Severe Weather Disruption
Barruecopardo operations faced significant challenges from a 1-in-50-year rain event that delayed southern pit access. Dewatering efforts continued through the quarter, with mining resuming in early July, reopening access to 1.2 million tonnes of ore at 0.186% WO₃.
Material moved hit a record 2.52 million tonnes, up 11% quarter-on-quarter, while ore mined increased to 260,963 tonnes. However, production was hampered by water in the southern pit, dropping to 15,265 mtu from 18,768 mtu the prior quarter. Recovery rates improved steadily to 58.8% by June, aided by the resumption of key processing circuits.
The company received a regulatory notice regarding water management at Barruecopardo but assessed the risk of operational suspension as low, citing no environmental harm or site discharge. EQR is working closely with regulators on temporary and permanent mitigation measures slated for FY2027.
Exploration Advances and Strategic Tenement Acquisition
Exploration drilling progressed strongly at both sites, with Mt Carbine completing 41 holes for over 10,700 metres and Barruecopardo initiating a 12,200-metre program targeting resource expansion and mine life extension. Assay results are pending and expected to inform updated resource estimates.
In Australia, EQR entered a binding agreement to acquire six exploration permits adjacent to Mt Carbine, covering approximately 365 km², supporting its hub-and-spoke strategy. Completion is expected shortly after satisfying conditions precedent by 31 August 2026.
Financial Discipline Amid Growth
Operating cash costs rose due to increased material movement, equipment hire, and labour recruitment to support the production ramp. Nominal cash cost per mtu increased but is expected to decline as production scales and strip ratios improve.
Investing activities consumed A$13.5 million, primarily for the Mt Carbine expansion, drilling programs, and equipment upgrades. Financing inflows of A$3.5 million mainly stemmed from option exercises.
EQ Resources remains well-positioned to capitalise on the global tungsten supply deficit, leveraging its growing production base, strategic tenements, and strong customer relationships to meet escalating demand for secure, non-Chinese tungsten concentrate.
Bottom Line?
With record production and a major expansion underway, EQ Resources is poised to leverage tight tungsten markets, but resolution of billing issues and regulatory compliance at Barruecopardo warrant close attention.
Questions in the middle?
- How will the resolution of the US$12.2 million invoice dispute impact near-term revenue recognition?
- Can the Mt Carbine expansion project meet its Q3 FY2027 commissioning timeline without cost overruns?
- What are the implications of the Barruecopardo water management notice for operational continuity and future permitting?
