Ramelius Resources has kept its FY27 production and cost targets intact despite wet-weather disruption at Penny, while advancing the infrastructure needed for a much larger Western Australian gold operation. The company ended September with A$768 million in cash and gold and secured an EPC contractor for its planned 3Mtpa Mt Magnet expansion.
- 48,839 ounces produced at A$2,656/oz AISC
- FY27 guidance retained at 205,000-225,000 ounces
- A$768 million cash and gold balance at quarter-end
- Primero appointed for Mt Magnet’s 3Mtpa Circuit 2
- Roe works approval clears a key Rebecca-Roe hurdle
Wet weather lifts costs but guidance remains intact
Ramelius Resources Ltd (ASX:RMS) produced 48,839 ounces of gold in the September quarter at an all-in sustaining cost of A$2,656 per ounce, but says it remains on track for FY27 guidance of 205,000 to 225,000 ounces at A$2,150 to A$2,350 per ounce. The quarter’s cost was elevated by weaker production and lower mill grades, rather than a change to the company’s full-year target.
Wet weather disrupted haulage from Penny during September, leaving 29,000 tonnes of ore grading 4.52 grams per tonne on the mine stockpile, equivalent to 4,202 ounces of contained gold. Ramelius expects that material to be processed in the December quarter. The company also processed 526,000 tonnes at Mt Magnet, with recovery of 93.2%, while Dalgaranga delivered 214,000 tonnes at a recovery rate of 89%.
Cash generation funds a larger operating footprint
Gold sales reached 51,278 ounces at an average realised price of A$6,019 per ounce, producing revenue of A$308.6 million. Operating cash flow was A$186 million and underlying free cash flow was A$62 million after sustaining capital, growth investment, exploration and tax payments.
Ramelius finished the quarter with A$740 million in cash and A$28 million of bullion, giving it cash and gold of A$768 million. Including listed investments, mainly holdings in Benz Mining and Forrestania Resources, the total rose to A$1.043 billion. The balance sheet also absorbed A$131 million of stamp duty on the Spartan acquisition, A$15 million of share buybacks and the receipt of A$205 million from the Edna May sale. The company has now completed A$156 million, or 62%, of its A$250 million buyback program.
Mt Magnet Circuit 2 moves from plan to construction
The centrepiece of the growth program moved closer to delivery during the quarter, with Primero appointed under a lump-sum EPC contract to build the new 3Mtpa Circuit 2 at Mt Magnet. Ramelius says the contract covers about 90% of the processing-upgrade capital spend, with completion targeted for the December 2027 quarter and commercial production in the March 2028 quarter. The project is part of the Mt Magnet expansion plan, which previously outlined a FY30 production target of 560,000 to 610,000 ounces.
A five-day October maintenance shutdown integrated the first-stage crusher and cyclone tower into the existing Circuit 1 plant. The revised design is intended to leave room for combined Mt Magnet throughput of potentially 5Mtpa or more, although that remains dependent on future operating performance and execution. Ramelius has also brought forward infrastructure spending, including camp, roads, water and power upgrades, to support the larger hub.
Never Never and Roe add momentum to the pipeline
At Dalgaranga, the Never Never underground mine produced 130,000 tonnes at 4.20 grams per tonne and remains on track to mine 500,000 tonnes during FY27, with a planned 1Mtpa mining rate by July 2027. That ramp-up is central to the Spartan growth plan, which earlier set out a pathway towards more than 600,000 ounces of annual production by FY30.
Ramelius also received EPA Part V works approval for the Roe site and has begun the process of securing the associated mining approvals. Rebecca is already fully permitted, while about A$50 million of early works spending for the combined Rebecca-Roe project has been brought forward into FY27. Separately, the company completed the Edna May acquisition sale for A$300 million, receiving A$210 million in cash and A$90 million in Forrestania shares. The estimated tax bill of A$45 million to A$55 million is expected in December.
The immediate test is whether Penny’s stockpile can convert into ounces without further haulage disruption, while the larger test is capital execution. Ramelius has A$480 million to A$570 million of FY27 growth spending embedded across the program, and the company’s longer-term production ambition now depends on several projects advancing at once rather than on a single mine doing all the work.
Bottom Line?
The quarter preserved guidance and strengthened the balance sheet, but the next proof point is converting construction spending and stockpiled ore into consistently higher production.
Questions in the middle?
- Can Penny’s 4,202 ounces of stockpiled contained gold be processed in the December quarter without another weather-related bottleneck?
- Will Never Never reach the planned 1Mtpa mining rate by July 2027 while Mt Magnet’s expansion remains under construction?
- How quickly will Roe’s remaining mining approvals and Rebecca-Roe early works translate into a defined production contribution?