Northern Star Resources Limited (ASX: NST) has released its June 2022 quarterly report, which also summarises FY22 operating results and provides guidance on FY23. Key points are highlighted below.
Environment, Social and Safety
- LTIFR at 0.5 per million man hours
- Completed installation of solar power plant at Carosue Dam, network integration progressing
Production
- Strong June quarter delivered FY22 production and cost guidance, showcasing Northern Star’s operational resilience to current challenges
- For the June quarter, gold sold totalled 402koz at an AISC of A$1,650/oz (US$1,180/oz) and AIC of A$2,204/oz; all three production centres operated at combined production rate of 1.6Mozpa
- For FY22, gold sold totalled 1,561koz at an AISC of A$1,633/oz (guidance of 1,550-1,650koz at an AISC of A$1,600-1,640/oz)
- Australian Operations delivered FY22 production and cost guidance; Pogo delivered above 2H expectations with annual run rate of 250koz
Discovery and Growth
- First year of five-year profitable growth pathway delivered significant progress:
- Kalgoorlie: Material movement of 66Mtpa (vs FY26 target of 80-100Mtpa)
- Yandal: Thunderbox mill expansion remains on track and within budget, ramp up expected 1H23
- Pogo: Mill expansion completed, mine ramp-up progressing with additional mining fronts
- For the June quarter, A$201 million spent on growth capital and A$37 million on exploration
- For FY22, A$674 million spent on growth capital and A$121 million on exploration, below guidance
- Delivered KCGM Mill Optimisation Pre-Feasibility Study (steady state plus three expansion options)
Financial
- Strong balance sheet with net cash of A$528 million at June 30; cash and bullion of A$628 million
- FY22e Cash Earnings of A$1,020-1,040 million (1H22a: A$430 million; 2H22e: A$590-610 million)
Corporate
- Completed sale of Paulsens and Western Tanami non-core assets for A$44.5 million
Outlook
- FY23 guidance of 1,560-1,680koz gold sold at an AISC of A$1,630-1,690/oz (2H weighted)
- FY23 growth capital budget of A$650 million; exploration budget of A$125 million
Commenting on the June quarter and FY22 performance, Northern Star Managing Director Stuart Tonkin said:
“I am extremely proud of our team for delivering our FY22 guidance in a year that has seen extraordinary challenges. Further, we have maintained reliable operations over the past year and protected the health and wellbeing of our team.
“The first full year of operating as the enlarged Northern Star has provided us a true understanding of the opportunities and requirements of our assets, particularly in this inflationary environment, and resulted in us increasing our FY23 capital budget. Our responsible approach to growth means we will be disciplined in how and when we spend the budget, at all times focused on maximising returns.
“I am very pleased with how Northern Star is performing and executing our profitable growth strategy to create value for shareholders. We continue our focus on producing profitable ounces from world-class gold assets in tier-1 locations. Combined with our differentiated operating capability – the NSMS internal mining services business – that enables industry leading underground productivity rates, Northern Star is in a strong position to deliver a successful FY23.”
