Alkane Resources Posts Record FY26 Profit and Declares Maiden Dividend

Transformational Merger Drives Record Profits

Alkane Resources (ASX:ALK) posted a staggering 590% jump in net profit after tax to A$228.7 million for FY26, its first full year following the August 2025 merger with Mandalay Resources Corporation. This merger instantly transformed Alkane from a single-mine operator to a multi-asset gold and antimony producer with three operating mines across Australia and Sweden.

The expanded portfolio includes the Tomingley Gold Operations in New South Wales, Costerfield gold-antimony mine in Victoria, and the Björkdal gold mine in Sweden. Together, these sites delivered record full-year gold equivalent production of 168,337 ounces, more than doubling the previous year’s output. This surge was complemented by a 50% increase in the average realised gold price to A$5,664 per ounce, underpinning a revenue leap of 257% to A$935.8 million.

Maiden Dividend and Strong Balance Sheet

Reflecting the company’s newfound scale and robust cash flow, Alkane declared its maiden fully franked final dividend of 2.0 cents per share, marking a significant milestone for the group. The company closed FY26 with a formidable cash, bullion, and listed investments position of A$454 million, a massive increase from A$60 million the prior year, and net cash of A$417 million after debt.

Alkane also refinanced its capital structure during the year, repaying a A$45 million project finance facility and securing a new $110 million revolving credit facility along with a $40 million contingent instrument facility, providing ample liquidity for growth and exploration.

Operational Highlights Across Three Mines

Tomingley set new records with 82,973 ounces of gold produced at an all-in sustaining cost (AISC) of A$2,429 per ounce, slightly below guidance. The Newell Highway realignment project, critical for future open pit mining, progressed well with $29 million invested.

Costerfield, acquired through the merger, produced 40,103 ounces of gold and 1,298 tonnes of antimony at an AISC of A$2,491 per gold equivalent ounce. The operation is focusing on operational improvements including drill and blast optimisation and transitioning to owner-operator development.

Björkdal in Sweden produced 40,837 ounces of gold at a higher AISC of A$3,991 per ounce, reflecting capital development and tailings dam upgrades. Exploration drilling at Björkdal’s Storheden deposit continues to reveal high-grade extensions, supporting potential mine life extension.

Exploration and Growth Pipeline

Alkane is advancing several growth projects and exploration initiatives. The Northern Molong Porphyry Project in NSW remains a key focus, with ongoing drilling and geophysical surveys identifying multiple high-priority targets. Environmental baseline studies for the Boda-Kaiser gold-copper project continue, supporting future development plans.

Exploration expenditure surged to $36.3 million, up sharply from $1 million the previous year, reflecting the expanded asset base and aggressive near-mine and regional programs.

Executive Remuneration Reflects Growth and Performance

The company’s remuneration report reveals a mix of fixed and performance-linked pay for executives, with short-term incentives tied to production, costs, safety, and reserve replacement. Long-term incentives are linked to total shareholder return relative to the gold sector. The Managing Director, Nicholas Earner, received total remuneration of A$1.35 million, with a significant portion ‘at risk’ based on performance.

Non-executive director fees increased following the merger to reflect the larger and more complex group, with Andrew Quinn appointed as Non-Executive Chair.

Risks and Regulatory Environment

Alkane continues to manage a broad risk profile spanning commodity price volatility, foreign exchange exposure, operational hazards, and regulatory compliance across three jurisdictions. The group maintains comprehensive environmental and safety management systems, with no significant environmental incidents reported during the year.

Notably, the group is progressing final closure works at the Lupin site in Canada and divested its non-core Chilean exploration project in March 2026.

FY27 Guidance and Market Positioning

Alkane reaffirmed its FY27 guidance, targeting group gold equivalent production of 163,000 to 177,000 ounces at an AISC of A$2,900 to A$3,200 per ounce. The guidance reflects expected output ranges of 78-84koz at Tomingley, 44-48koz at Costerfield, and 41-45koz at Björkdal. Growth capital expenditure is forecast at A$160-190 million, with exploration budgets of A$45-53 million.

The company’s shares are dual-listed on the ASX and TSX and were admitted to the S&P/ASX 200 index in April 2026, enhancing its market profile and liquidity.

Alkane’s record FY26 results and maiden dividend declaration underline the immediate benefits of the Mandalay merger, while the ambitious growth and exploration programs set the stage for sustaining production and extending mine life. However, the company’s ability to execute on its pipeline and manage cost pressures amid commodity price fluctuations will be critical to watch in FY27.