Northern Star Resources Limited (ASX: NST) has released its activities report for the three months to 31 March 2025.
Northern Star is the largest gold producer with a primary listing on the ASX. Its production centres are Kalgoorlie and Yandal in Western Australia and Pogo in Alaska, US. The company is finalising its takeover of De Grey Mining.
Key points:
Operating performance
- SLTIFR at 0.4 injuries per million hours worked
- Gold sold totalled 385koz at an AISC of A$2,246/oz (US$1,409/oz)
- KCGM underground and open pit ore movement higher; grade uplift delayed to June quarter
- Jundee mined volumes significantly higher; Thunderbox delivers positive step-change in milling costs
- Pogo gold sales of 68koz as mill continues to deliver consistently strong performance
- Underlying free cash flow of A$201 million; strong net mine cash flow of A$295 million
- KCGM Mill Expansion tracking to plan; transitioned into structural and mechanical installation
FY25 outlook revised
- FY25 production and cost guidance has been revised to 1,630-1,660koz at A$2,100-2,200/oz (previously 1,650-1,800koz at A$1,850-2,100/oz) as a result of delayed access to Golden Pike North, higher maintenance costs across Yandal and higher royalties from elevated gold prices
- FY25 growth capital and exploration guidance accelerated from increased activity
Strong investment-grade balance sheet; fully funded organic growth strategy
- Net cash of A$181 million after A$279 million dividend payment; cash and bullion of A$1,121 million
- Hedge book winds down with no hedges added over the last two quarters
- On-market share buy-back program 89% complete (average price: A$10.51), remains open to September 2025
- Effective date of the De Grey Scheme of Arrangement was 23 April; implementation date is 5 May
Commenting on the March quarter performance, Northern Star managing director Stuart Tonkin said:
“We are pleased that De Grey shareholders voted overwhelmingly in favour of the scheme of arrangement and, upon implementation of the scheme on 5 May, look forward to welcoming their team – and their shareholders – into Northern Star.
“During the March quarter, we delivered strong net mine cash flow of A$295 million across all production centres despite operational challenges at our biggest asset, KCGM. Mining of higher-grade ore in the KCGM open pit was delayed because of low productivity in the Golden Pike North area. Mining efficiency is on track to lift significantly in the June quarter.
“Our balance sheet remains in a net cash position and free cash generation is expected to significantly increase as we lift production going forward, which enables us to reward shareholders in this period of historically high gold prices.
“As a result of the near-term challenges at KCGM, we have revised production and cost guidance for FY25.”
