Hawsons Iron has completed a Preliminary Feasibility Study confirming a 2.3 billion tonne Ore Reserve and outlined a 26-year mine plan, while raising over AUD 7 million through share placements and plans. The company faces going concern uncertainty but is progressing funding talks including a non-binding EOI from KfW IPEX.
- 2.3 billion tonne Probable Ore Reserve declared
- Preliminary Feasibility Study supports 26-year mine life at 12Mtpa
- Pre-tax NPV8 of AUD 1.36 billion and IRR of 11.9%
- Raised over AUD 7 million via share purchase plans and placements
- Material uncertainty on going concern noted by auditor
Massive Ore Reserve and Feasibility Study Completion
Hawsons Iron Limited (ASX:HIO) has marked a significant milestone by declaring a JORC-compliant Probable Ore Reserve of 2.3 billion tonnes at an average grade of 11.7% Davis Tube Recovery (DTR) and 16.7% total iron, underpinning its Hawsons Iron Project. This declaration follows the completion and update of a Preliminary Feasibility Study (PFS) in December 2025 and May 2026, which outlines a robust development strategy targeting production of up to 12 million tonnes per annum of +68% Fe magnetite concentrate over a 26-year mine life.
The PFS delivers positive technical and financial metrics, including a pre-tax net present value (NPV8) of AUD 1.36 billion at a US$140/t product price and an Australian dollar to US dollar exchange rate of 0.65, alongside a pre-tax internal rate of return (IRR) of 11.9%. The project forecasts a 13-year payback period from the start of engineering and construction management, with an initial capital cost of approximately AUD 4.94 billion split across two phases. Operating costs are estimated at US$44.20 C1 cost and US$85.12 CFR per dry metric tonne.
Capital Raising and Funding Progress
During the 2026 financial year, Hawsons successfully raised over AUD 7 million through a series of share purchase plans (SPPs) and placements, including a $1.23 million SPP completed post year-end in August 2026. Directors actively participated in these capital raises, contributing approximately $90,000 in the latest SPP. Alongside equity funding, the company received a non-binding expression of interest from German lender KfW IPEX for financing up to 85% of eligible German mining and processing equipment exports, subject to detailed appraisal.
These capital injections have supported ongoing feasibility studies and project optimisation, including a collaborative research initiative with CSIRO targeting secondary product recovery and pelletisation improvements for the magnetite concentrate. However, despite these advances, Hawsons reported a loss after tax of AUD 2.06 million for the year ended 30 June 2026, with cash reserves of AUD 498,102 at balance date.
Going Concern Uncertainty and Operational Outlook
The company’s financial statements disclose net current liabilities of AUD 661,638 and net cash outflows from operating and investing activities totaling approximately AUD 3.46 million during the year, raising material uncertainty regarding its ability to continue as a going concern. The auditors issued an unqualified opinion but highlighted this uncertainty, noting that the company’s ongoing viability depends on successful equity raising and project development.
The directors remain confident in the going concern basis, citing recent capital raises and the company’s strategy to fund future activities through equity issuance. Hawsons continues to advance its feasibility study work and is actively engaging with potential strategic investors to secure funding for the next development phase.
Governance, Remuneration, and Shareholder Structure
Governance changes saw Meredith Campion and Tom Revy appointed as Non-executive Director and Managing Director respectively during the year, with former director Tony McGrady retiring. Directors and key management personnel hold significant share and option interests, aligning their incentives with shareholder value creation. The remuneration report details a mix of fixed salary, bonuses, and options linked to project milestones such as securing Bankable Feasibility Study (BFS) funding and financial investment decisions.
At 30 June 2026, Hawsons had approximately 1.38 billion ordinary shares on issue and 276 million options outstanding. The top 20 shareholders collectively control around 20.85% of the register, with no substantial shareholder declarations at the reporting date.
Project Resources and Reserves Stability
The Mineral Resource estimate remains steady at 4.4 billion tonnes at 11.4% DTR, with no material changes reported during the year. The Probable Ore Reserve of 2.3 billion tonnes represents 95.4% of the Measured and Indicated Mineral Resources, providing a solid foundation for future mine planning and development. These figures were prepared and reviewed by qualified industry professionals in line with JORC Code standards.
Hawsons Iron is committed to environmental and social governance, operating within regulatory approvals and maintaining transparent reporting. No significant breaches or contingent liabilities were reported.
Bottom Line?
While Hawsons Iron’s massive Ore Reserve and positive feasibility metrics offer a promising development pathway, the company’s ability to secure sufficient funding remains critical amid going concern uncertainties.
Questions in the middle?
- Will Hawsons secure the necessary funding to progress from feasibility to construction?
- How might iron ore price volatility impact the project's economics and investment appeal?
- What upside opportunities from the PFS could materially improve project returns?