$880,685 profit as Gullewa consolidates property and lifts CIO stake

Royalty income remains the earnings anchor

Gullewa Limited (ASX:GUL) produced a consolidated profit after tax of $880,685 for the year ended 30 June 2026, down from $1.63 million a year earlier. Profit attributable to Gullewa shareholders fell to $1.21 million from $1.94 million, while basic earnings per share declined to 0.55 cents from 0.89 cents.

The company’s largest operating income stream was its 1% royalty over Vault Minerals’ Deflector Project, which generated $2.98 million during the year. That was below the $3.87 million recorded in 2025, leaving the royalty stream as the central contributor to earnings but also exposing the result to production, gold prices and the operator’s performance.

Cash generation was notably softer. Net operating cash flow fell to $266,668 from $1.74 million, while year-end cash and cash equivalents stood at $3.05 million. Gullewa also held $4.6 million in term deposits and $1.84 million in listed investments at fair value through profit or loss.

Property control shifts onto Gullewa’s balance sheet

Gullewa increased its interest in Hunter Valley Solutions from 69.47% to 98.4% on 19 November 2025 and obtained full management control of the property development. The company paid $45,000 for the additional interest, with the transaction accounted for as an asset acquisition rather than a business combination.

The move brought $4.92 million of property development inventory onto the consolidated balance sheet. At Aberglaslyn, Stage 4 construction covering 13 lots was completed during the year and the sales process began in July. Across the development, 48 lots have now been developed, with the final stage dependent on the sale of all Stage 4 lots.

Central Iron Ore expands gold project exposure

Gullewa’s interest in Central Iron Ore increased to 65.77% after CIO completed a rights issue. Through the subsidiary, the group holds interests in the South Darlot joint venture and the British King Mine Area, which is currently in care and maintenance.

Development work during the year included a British King mineral resource re-estimation, a review of the Endeavour resource estimate, preliminary geotechnical work and environmental studies covering fauna, subterranean fauna and surface water. A renewal application for mining lease M37/30 was lodged on 24 March 2026 and had been advertised by year-end; the company said the “negotiation in good faith” period with the Native Title Party began on 1 July 2026.

The audited accounts identify the recoverability of $6.64 million in capitalised exploration, evaluation and development assets as a key audit matter. That balance remains dependent on continuing tenure, exploration and eventual development, exploitation or sale of the relevant areas. Property inventory recoverability and the Hunter Valley consolidation were also highlighted as key audit matters.

Gullewa declared a fully franked dividend of $1.53 million, equal to 0.7 cents per share, on 4 May 2026. It was paid on 3 July, after the reporting date, matching the per-share dividend paid in the previous year despite the lower earnings result and producing a reported payout ratio of 126.2%.