Broken Hill Mines delivered its first quarterly silver output above 100,000 ounces as three ore feeds lifted mining and processing at Rasp. The September quarter also brought A$37.6 million in sales, an A$85 million capital raise and fresh high-grade drilling results at Centenary and Pinnacles.
- Record 102,922oz quarterly silver production
- 142.5kt mined and 129.1kt processed at Rasp
- A$37.6m sales against A$33.4m operating costs
- A$112.9m reported total liquidity after October financing
- Centenary Exploration Target due for release
Rasp production clears 100,000-ounce silver milestone
Broken Hill Mines Limited (ASX:BHM) has produced more than 100,000 ounces of silver in a quarter for the first time, as ore from Western Min, Main Lode and the restarting Pinnacles operation fed the Rasp processing plant. Silver output reached 102,922oz in the September quarter, up 7.4% from June and 148% from a year earlier.
The production record was supported by quarterly mining of 142.5kt, a 6.9% increase, while ore processed rose 8.2% to 129.1kt. Western Min supplied 72% of mined ore, Main Lode 18% and Pinnacles 10%. Pinnacles material was still largely lower-grade remnant ore from pit clean-up, but BHM said the mine had reached the base of the current pit, where higher-grade fresh ore is now exposed. The result builds on the September silver production record, which was reported before the full quarterly financial data was released.
Sales rose as operating costs stayed below revenue
Quarterly sales revenue reached a record A$37.6 million, compared with cash operating costs of A$33.4 million. The sales figure does not equal cash received during the period: receipts from customers were A$20.2 million because of shipment timing and an A$18 million reduction in the offtake working-capital balance.
Production costs were A$21.8 million, staff costs were A$9.4 million and administration, corporate and net interest costs totalled A$2.2 million. Growth capital expenditure added A$13.3 million, including A$5.6 million for the Rasp Tailings Dewatering Plant and A$5.4 million for the Pinnacles restart. Sustaining capital was reported at approximately A$6 million in the detailed cash-flow section, mainly for underground development and fleet upgrades.
Capital raise funds Centenary and Pinnacles expansion
BHM completed the second tranche of an A$85 million placement in October, after raising A$60 million during the quarter at A$0.76 a share. The funds are earmarked for a Centenary production decline, accelerated resource drilling and infrastructure upgrades, as well as Pinnacles production growth and drilling.
The balance sheet also moved in the company’s favour during the quarter. Debt reduction totalled A$8.9 million, while the detailed cash-flow statement showed A$66.3 million in cash at 30 September. BHM reported total liquidity of A$112.9 million, a figure that includes financing and other liquidity components after the October equity funding. The company said it had roughly A$30 million of undrawn offtake capacity after quarter-end and estimated six quarters of funding based on its reported relevant outgoings.
Centenary drilling points to larger mineralised system
Exploration remains the more consequential longer-term part of the update. Drilling at Centenary returned 25.8 metres at 11.7% zinc equivalent and 323g/t silver equivalent from 415 metres, while a separate hole outside the existing resource returned 17.8 metres at 10.1% zinc equivalent and 280g/t silver equivalent. That hole included 5.4 metres at 19.5% zinc equivalent and 540g/t silver equivalent, and connected the northern and southern portions of the Centenary mineral resource across a 1,600-metre strike length.
Those results extend the Centenary high-grade discovery, which earlier drilling had indicated could materially exceed historical estimates. BHM is now finalising a maiden Exploration Target for the zone. That target is not yet a mineral resource or reserve, and its eventual scale and economic significance remain to be established.
Pinnacles grades improve while financing remains conditional
Pinnacles drilling also produced broad, shallow silver-lead-zinc intercepts, including 14.4 metres at 20.3% zinc equivalent and 561g/t silver equivalent. Several holes carried gold and copper credits, including 5.6 metres at 3.2g/t gold and 0.2% copper. Further open-pit and underground assays are being compiled for release.
BHM has also signed a non-binding letter of intent with Ausinmet for up to US$30 million of additional working capital financing alongside zinc offtake of up to 200,000 tonnes. The proposed facility remains subject to definitive documents and third-party consents. Near-term execution therefore matters: the December quarter needs to demonstrate that higher-grade Pinnacles and Main Lode feed can lift grades and recoveries, while the Tailings Dewatering Plant remains scheduled for availability in the first half of calendar 2027.
Bottom Line?
The production ramp is now visible in the numbers, but the next test is whether higher-grade feed can convert record throughput into consistently stronger operating cash flow.
Questions in the middle?
- How quickly will higher-grade Pinnacles and Main Lode ore improve recovered grades and margins?
- What size and quality will BHM’s maiden Centenary Exploration Target ultimately disclose?
- Will the proposed Ausinmet facility reach definitive documentation, and how much additional growth capital will the expanded operations require?