Northern Star Resources stays on track with gold production targets despite heavy rains and flooding

Despite heavy rains and flooding across inland parts of Western Australia, Northern Star Resources (ASX: NST) has confirmed it is on target to achieve its previously-flagged gold targets.

Announcing its preliminary production results for the three-month period ended 31 March 2024, Northern Star reported gold sold totalled just 401,000 ounces due to the impact of significant weather events across the Northern Goldfields.

However, the company says its June quarter has started with strong operational momentum and the weather disruptions now seemingly behind it.

Increased access

Improved road and weather conditions have allowed increased access to high-grade Golden Pike North material at the Kalgoorlie production centre, early access to first ore at Wonder underground in the Yandal production centre and grade improvements at the Pogo production centre.

Managing director Stuart Tonkin said Northern Star remains on track to deliver its FY24 group gold sold guidance of 1.60 million ounces to 1.75Moz.

The company’s confidence in those numbers is largely due to the positive momentum leading into an expected strong June quarter, driven predominantly by increased grade and mill utilisation rates.

“The resilience of our team and assets was demonstrated during the quarter with operations further challenged due to adverse weather,” Mr Tonkin said.

“Our profitable growth strategy coupled with elevated gold prices is expected to deliver significant cash flow generation and […] superior shareholder returns.”

Revised cost guidance

However, the events during the quarter have led the company to revise its FY24 all-in sustaining costs guidance to between $1,810/oz and $1,860/oz, up from the previous forecast range of $1,730/oz to $1,790/oz.

At the same time, Northern Star has maintained its FY24 growth capital guidance range of $1.15 billion to $1.25b and exploration budget of $150m.

At 31 March, the company has maintained a strong financial position with net cash of $174m.

Cash and bullion totalled $1.076b (vs. December quarter $1.089b) after the payment of the FY24 interim dividend of $169m.

Mr Tonkin said major organic growth projects continued to advance during the quarter, while the KCGM mill expansion remains on track and on budget.

Northern Star will release its March quarterly results on 23 April 2024.