Kingsgate Surpasses FY26 Gold Target with Strong Cost Control and ASX200 Inclusion

FY26 Production and Cost Performance

Kingsgate Resources (ASX:KCN) delivered a strong operational finish to FY26, producing 86,078 ounces of gold and 766,009 ounces of silver, totaling 97,159 ounces gold equivalent. This marks a 15% increase in gold output compared with the prior year and meets the company’s full-year guidance. Notably, the Chatree Gold Mine sustained its sixth straight quarter exceeding 20,000 ounces of gold, underscoring operational consistency.

Cost discipline was a highlight, with the all-in sustaining cost (AISC) before royalties clocking in at US$1,178 per ounce; well below the guided range of US$1,550 to US$1,750. For the June quarter alone, AISC (pre-royalties) was US$1,134/oz, reflecting tight control despite inflationary pressures. The company achieved an AISC margin of US$2,235 per ounce sold in the quarter, supported by an average realised gold price of US$4,432.

Operational Challenges and Plant Repairs

Mining volumes remained steady, but waste mining surged 43% due to the A-East cutback, increasing the strip ratio to 3:1. This elevated waste movement is expected to continue into the next quarter as mining activities ramp up at Q Pit. Processing throughput was slightly lower at 1.27 million tonnes for the quarter, with plant availability at 90.3%.

Plant #1 repairs remain on track, with the replacement trunnion bearing en route and hydraulic components being airfreighted. The ball mill remediation is progressing well, supported by Metso technical specialists and contingency tooling. Meanwhile, SAG Mill #1 operates at about half capacity, maintaining production during the repair phase. This phased approach aims to minimise downtime and preserve operational momentum.

Financial Position and Capital Deployment

Kingsgate’s cash, bullion, and doré holdings stood at A$179.2 million at quarter-end, including restricted cash of A$26.1 million. Available cash and bullion decreased by A$37.2 million from the prior quarter, reflecting strategic capital deployment. Key uses included a A$26.6 million unfranked interim dividend, A$22.4 million acquisition of royalty and water rights at Nueva Esperanza, and A$6.6 million for land adjacent to Chatree to support mine expansion and tailings storage facilities.

The company’s balance sheet remains robust despite a challenging economic backdrop marked by higher fuel costs; up 27% due to geopolitical tensions; and lower commodity prices. Mining costs per tonne rose 12%, driven by diesel and explosives consumption linked to increased waste movement. Processing costs also increased by 24% per tonne due to mill relining and maintenance, a necessary short-term expense for long-term efficiency.

Strategic Advances at Nueva Esperanza and Sustainability Initiatives

In Chile, Kingsgate progressed its Nueva Esperanza silver-gold project with the acquisition of royalty and water rights, removing significant financial burdens and unlocking development potential. Technical work advanced with geometallurgical drilling scheduled to commence, supported by contract specialists and new infrastructure on site.

On the sustainability front, Kingsgate’s Thai subsidiary, Akara, earned Thailand’s Ministry of Industry Green Industry Level 3 certification, reflecting rigorous environmental and safety standards. The company also co-hosted a national seminar highlighting tailings as a valuable resource under circular economy principles, elevating public and industry awareness.

Outlook and Upcoming Catalysts

Looking ahead, Kingsgate is focused on completing Plant #1 repairs to restore full processing capacity and advancing drilling programs at Chatree’s A and Q pits to support mine life extension. Exploration licence approvals in Thailand are progressing, with drilling expected to begin shortly. Meanwhile, water and tailings management studies are underway to ensure sustainable operations and regulatory compliance.

With its inclusion in the S&P ASX200 Index, Kingsgate gains greater visibility among institutional investors, potentially broadening its shareholder base. The company’s disciplined capital allocation and operational resilience position it well to navigate commodity price volatility and geopolitical uncertainties.