Westgold Resources boosts production through ore purchases, continues to build cash in latest quarter

Westgold Resources has used ore purchases to churn out significantly more gold and cash during the latest quarter. Westgold told the Australian Securities Exchange on Wednesday it produced 111,418 ounces of gold during the December quarter, up from 83,937oz in the September quarter, 88,032oz in June, and 80,107oz in March. The company said the rise was the result of improving output in the Murchison, largely from higher grades at Fortnum and production from the ore purchase agreement with New Murchison Gold at Meekatharra. Westgold said the all-in-sustaining cost for the quarter was $3500/oz, up from $2861/oz in September, reflecting a decision to maximise cash generation. The company said buying a higher volume of high-grade oxide ore under the ore purchase agreement provided an opportunity to increase milled grade at Meekatharra which, while carrying a higher unit cost to Westgold, delivered stronger group cash flow. It said the ore purchase agreement added $14 million to the cash build in the quarter and quarterly production would have been 89,101oz at an AISC of $2945/oz without the ore purchases. Westgold’s underlying cash build during the quarter was $365m before one-off payments of stamp duty ($76m), debt repayments ($50m), dividends and share buy backs ($29m), growth and exploration spend ($48m on non-sustaining capital and $6m on exploration), and one-off cash inflows of $26m (proceeds from asset sales). Its underlying cash build during the September quarter had been $180m. The company had cash, bullion and liquid investments of $654m at December 31, representing a build of $182m in the quarter. It maintained its production guidance for FY26 of 345,000oz to 385,000oz at an AISC of $2600/oz to $2900/oz. Westgold managing director and chief executive Wayne Bramwell said the company had delivered a record quarterly cash build and production. “Operational improvement from our assets continued and we had the opportunity to super-charge our cash build by purchasing a higher volume of third-party ore,” he said. “This third-party ore delivered 22,317 ounces and monetising it further strengthened our balance sheet. “These factors culminated in the group closing the quarter with a treasury of $654m. “The business has scale, is debt-free, unhedged and has a clear plan outlined in its three-year outlook to sustain increased gold production at a lower cost.” Mr Bramwell said output from the southern Goldfields was stable at 30,484oz, compared with 30,797oz in September, with recent infrastructure upgrades at Beta Hunt near Kambalda enabling higher underground development to create access to additional mining fronts. “We continue to target a consistent mining rate of 2Mtpa at Beta Hunt by the end of this financial year,” he said. “The ramp-up of our key operations, including our Bluebird–South Junction mine at Meekatharra and Great Fingall at Cue, and increasing outputs from Beta Hunt in Kambalda, will see higher-grade ore replacing the low‑grade stockpiles utilised across the group to maintain processing throughputs at our largest processing hubs. “We are also actively advancing opportunities to bring value forward in the three-year outlook with a range of Westgold-owned open pit targets being drilled. “As we enter the second half of FY26, our focus remains on consistent operational delivery. “Our key growth projects are advancing to plan and our planned demerger and IPO of Valiant Gold during the second half of FY26 has the potential to create additional ore supply for our Murchison processing hubs.” Westgold shares were up 66¢, or 9.6 per cent, to $7.53 at the close on Wednesday.