Aurelia Metals generated its strongest quarterly Cobar operating cash flow since 2018 as higher gold, copper and zinc production lifted cash to A$160.7 million. The company reaffirmed FY27 guidance while moving closer to a major Peak processing expansion.
- Cobar operating cash flow reached A$65.3 million after sustaining capital
- Gold, copper and zinc production rose quarter on quarter
- Cash increased to A$160.7 million, with total liquidity of A$200.7 million
- Peak processing capacity expansion is scheduled to complete in Q2 FY27
- Federation water inflows slowed decline development but did not change FY27 guidance
Cobar cash flow reaches its highest level since 2018
Aurelia Metals Limited (ASX:AMI) has started FY27 with a useful combination of higher production and a stronger balance sheet. Cobar Region operating cash flow reached A$65.3 million in the September quarter, after sustaining capital, up from A$53.1 million in June and the company’s highest quarterly result since 2018. Cash on hand rose to A$160.7 million, while the undrawn revolving credit facility lifted total liquidity to A$200.7 million.
The result builds on the momentum described in Aurelia’s FY26 profit growth, when revenue, EBITDA and net profit all increased as Federation entered commercial production. Gross sales revenue in the latest quarter rose to A$165.5 million from A$160.7 million, helped by stronger realised gold, zinc and copper prices, although sales volumes were mixed across the metals portfolio.
Gold, copper and zinc production move higher
Group production increased to 16.2 thousand ounces of gold, 1.3 thousand tonnes of copper and 8.3 thousand tonnes of zinc. Lead production was 5.2 thousand tonnes. Gold, copper and zinc all rose from the June quarter, while lead eased slightly. Aurelia processed 225,583 tonnes of ore, broadly consistent with the previous quarter, but benefited from higher grades and a greater share of copper ore.
Peak supplied 148,000 tonnes of ore and Federation 97,000 tonnes. Combined run-of-mine stockpiles grew from 104,000 tonnes to 123,000 tonnes, providing additional feed ahead of the planned capacity increase. Aurelia reaffirmed FY27 production, cost and capital guidance, including gold production of 50,000 to 60,000 ounces and copper production of 2,500 to 3,500 tonnes.
Peak expansion approaches commissioning
The next operational test is whether Aurelia can turn those stockpiles and higher grades into sustained throughput growth. Final regulatory approval has been received to lift Peak’s processing capacity from 800,000 tonnes per annum to approximately 1.1 million to 1.2 million tonnes per annum. The process water project is complete, while the tertiary ball mill and cyclone cluster are being tied in ahead of commissioning in Q2 FY27.
The company says the expansion is expected to be available by the end of Q2 FY27 and should support higher processing rates, particularly for copper ore. That timing matters because the Peak plant expansion was already identified as a central growth project after Aurelia reported record FY26 gold production and a stronger financing position.
Federation water inflows slow mine development
There was a less tidy operational detail at Federation. Higher-than-planned water inflows accumulated in the decline and restricted deeper development during the quarter, while July also brought production-drill and loader downtime and operator shortages. Aurelia has added evaporator capacity and rented a second reverse-osmosis plant; it is targeting dewatering in Q2, with normal development rates expected from Q3 FY27.
Management said the disruption is not expected to affect FY27 metal production guidance. That remains a company expectation rather than an achieved outcome, and the coming quarters will show whether the mine can recover its development pace without adding pressure to costs. The group’s environmental incident frequency rate also increased to 2.17 from 0.76, despite a reduction in its total recordable injury frequency rate.
Great Cobar and exploration add to the growth pipeline
Development at Great Cobar continued on schedule, with 506 metres completed during the quarter and 2,380 metres completed to date. The surface foundation collar for the raisebore rig is in place, with mobilisation planned in Q2 FY27 to begin the pilot hole. Aurelia’s presentation says first ore remains targeted for FY28, while the capital budget and project schedule remain on track.
Exploration is running in parallel. Drilling has identified a gold-rich transitional zone between Peak and Kairos, alongside extensions north of the Kairos Eastern Copper Lens and Perseverance Zone A. Assay results from several Cobar and Nymagee programs are expected in Q2 FY27, creating a near-term flow of operational and exploration updates.
New CEO inherits a stronger but more demanding platform
Steve Badenhorst commenced as managing director and chief executive officer on 6 October, following the CEO appointment announced in August. Andrew Graham, chief development and technical officer, has resigned and is due to leave in November. Badenhorst’s early tenure therefore begins with cash generation and project execution moving in the right direction, but with Peak commissioning, Federation dewatering and Great Cobar all requiring delivery against stated schedules.
Bottom Line?
Aurelia enters the next quarter with cash generation doing much of the talking; the harder evidence will come from Peak commissioning and Federation’s return to normal development.
Questions in the middle?
- Can Peak’s expanded circuit be commissioned on schedule and convert the growing ROM stockpile into higher sustained throughput?
- How quickly will Federation clear the decline water and restore planned development rates?
- Will Great Cobar maintain its FY28 first-ore target while exploration results add or reshape the longer-term growth pipeline?