Vault Minerals Hits FY26 Gold Target, Advances KoTH Upgrade and Seals Genesis Merger

Strong FY26 Production and Cash Generation

Vault Minerals (ASX:VAU) closed FY26 with gold production of 336,540 ounces, hitting the upper end of its guidance range. The June quarter alone delivered 89,338 ounces at an average realised price of A$6,311 per ounce and an all-in sustaining cost (AISC) of A$2,968 per ounce. This performance generated underlying free cash flow of A$219 million, bolstering the company’s cash and bullion position to a robust A$842 million by quarter end, with zero debt and no hedge exposure after settling its remaining gold hedges for A$31.2 million.

Operational Highlights Across Key Regions

The Leonora operation led production with 48,899 ounces in the quarter at an AISC of A$2,556 per ounce, benefiting from a 16% increase in underground mined grades and a 33% rise in high-grade open pit feed. The King of the Hills (KoTH) processing plant upgrade is on track, with Stage 2 now 85% complete and commissioning slated for September 2026. This upgrade is expected to boost throughput by 50%, supporting a 34% lift in Leonora’s gold production in FY27.

Mount Monger produced 21,338 ounces during the quarter, with underground mining at the Daisy Complex sustaining output and open pit mining focused on the Santa Open Pit Complex. Stockpiles increased modestly, and the operation reported an AISC of A$3,143 per ounce. The company plans to transition to owner-operated mining at Mount Monger in FY27, potentially extending underground production beyond FY27 through exploration at Daisy and possible recommencement at Mount Belches.

Deflector delivered 19,101 ounces of gold and 88 tonnes of copper in the quarter, with gold equivalent sales of 18,896 ounces at an AISC of A$3,761 per ounce. Underground production increased following the transition to owner-operator mining in November 2025, with a 50% rise in ore production and 38% more development metres quarter-on-quarter. Exploration success at the Contact Lode has added a third mining front, extending mine life beyond current Ore Reserves.

Sugar Zone Advances Toward Production Restart

The Sugar Zone project in Ontario marked significant progress with the formal filing of the Closure Plan Amendment and receipt of the amended Sewage Environmental Compliance Approval in July 2026. These regulatory milestones enable construction of the Southern Tailings Management Facility (STMF), a more cost-efficient tailings solution. Underground development recommenced on 1 July 2026, with the fleet fully commissioned and ramp-up underway. The operation targets production commencement in Q1 FY28, with approximately 6,500 ounces expected for processing upon plant restart.

Exploration efforts at Sugar Zone continue with surface stripping and mapping along the southern mine corridor, aiming to identify new high-grade shoots and drill targets. Capital expenditure for FY27 includes A$96 million for Sugar Zone development and infrastructure, reflecting the company's commitment to bringing the project back into production.

Growth Capital and Owner-Operator Transition

Vault invested A$48.1 million in growth capital during the quarter, primarily focused on the KoTH processing plant upgrade, waste stripping at KoTH and Mount Belches, and the transition to owner-operated mining fleets at KoTH and Deflector. The company plans further capital expenditure of A$173 million in FY27 to support production growth, including A$46 million for open pit owner-operator fleet acquisition and A$45 million for underground mining fleet purchases.

Exploration drilling is set to intensify with a 7% increase to A$25 million in discovery exploration and a 65% jump in resource definition drilling to A$19 million, targeting extensions to existing operations and maximising infrastructure benefits.

Genesis Merger to Create a New Gold Major

Shortly after the quarter ended, Vault and Genesis Minerals agreed to merge via a scheme of arrangement, consolidating their Leonora assets under single ownership. The merged entity is projected to rank among the top 20 global gold producers by market capitalisation, with potential operational synergies estimated at A$2 billion over 10 years, primarily from the Leonora district. This transformative deal, scheduled for completion in Q2 FY27, positions Vault for further growth and scale in the competitive gold mining sector.