Evolution Mining rides gold price surge to record FY24 earnings and dividend increase

Australian gold and copper miner Evolution Mining (ASX: EVN) has delivered record earnings alongside strong cash generation during the 2024 financial year.

Boosted by robust commodity prices, the company successfully increased its EBITDA margin to 47% and lifted group cash flow to $367.3 million, despite investing $739.6m back into the business.

Evolution’s FY24 success saw the company declare its 23rd consecutive dividend, more than doubling last year’s final payout to $0.05 per share.

Strategy paying off

Managing director and chief executive officer Lawrie Conway highlighted the record financial performance and excellent progress the company has made with its balance sheet.

“More than doubling the final dividend while continuing to invest in our various project opportunities is a testament to our strategy and capital allocation discipline,” he said.

“We are ideally positioned for FY25, which will see us continue our high cash generation through planned higher production at a sector-leading cost position.”

“Retaining the approach of ‘margin over ounces’ and banking the cash from higher metal prices will allow Evolution to build on the strong de-leveraging progress made in FY24 and continue to provide returns to shareholders through dividends.”

Mr Conway noted that only around 6% of the company’s forecast FY25 gold production is hedged, while copper is entirely unhedged.

Continued growth

Evolution expects to continue its success in FY25, estimating it would achieve gold production of between 710,000 and 780,000 ounces and copper production of between 70,000 and 80,000 tonnes.

All-in sustaining cost guidance is between $1,475 and $1,575/oz.

The company is confident its high cash-generation momentum will continue, with material cash flow upside at current spot prices.

Mr Conway said the company’s debt maturity profile is aligned with expected future cash flows, with only $75m repayable in FY25.

Cowal boost

The company’s FY25 performance is expected to be boosted by the ongoing development of the Cowal underground mine in NSW.

Evolution said Cowal has started to contribute to cash flow as it ramps up to its designed capacity and has already fully paid back all of its acquisition costs and subsequent capital expenditure including the underground development during FY24, generating $294.2m in net mine cash flow.

The next phase of the Cowal open-pit development is continuing through the regulatory approval process and remains subject to a final investment decision by the board, expected in late FY25.