Northern Star Resources on track to meet its 2024 gold sales goals

Northern Star Resources (ASX: NST) remains on target to reach its 2024 financial year gold sale goals following a strong June quarter.

Northern Star’s strong quarterly and full year underlying free cash flow was significantly boosted by its Kalgoorlie operations, which contributed more than half of the group’s performance.

The company told shareholders that an improved second half forecast has it placed to hit between 1,600k and 1,750k ounces of gold sold at an AISC of A$1,730 to $1,790 per ounce in FY24.

Thunderbox to boost numbers

The company’s second half numbers will be boosted in particular by increased production at the Thunderbox operations where mill sustainably delivers a rate of six million tonnes per annum (Mtpa).

This will be backed up by higher ore volumes and grade at the KCGM project and continuous grade improvements at Pogo in Alaska.

However, production will be impacted in the September quarter due to planned major shutdowns to be carried out across the company’s three production centres.

Northern Star also reported that its group capital expenditure (sustaining, growth, exploration) for FY24 is forecast to be similar to FY23, excluding a $525 million hit for KCGM Mill expansion.

FY23 Guidance achieved

The company also welcomed its success in meeting its FY23 guidance for Group sales, AISC and exploration.

However, growth capital expenditure of $752 million was above revised expectations, driven primarily by KCGM Mill Expansion early works and procurement of long-lead items, increased capital drilling at Jundee, and commercial production being declared later than planned at Otto Bore, both part of the Yandal production centre.

The company said it also remains well set financially for its maintenance and growth plans with net cash of $362 million at June 30 and cash and bullion of $1,247 million.

Managing director Stuart Tonkin said a strong June quarter has helped the company meet its FY23 sales and cost guidance, while growth and exploration works progressing ahead of plan resulting in the capital expenditure and exploration spend above guidance.

“We finished the year with increasing operational momentum, meeting our full year production and cost guidance. As we look ahead to FY24 and beyond, the quarterly performance reinforces the strength and stability of Northern Star’s asset base,” Mr Tonkin said.

“The strong operational performance has driven significant cash flow generation and we remain well-positioned to fully fund our organic growth options. We welcome the recent approval of the KCGM Mill Expansion, which sets up the next phase of enhancement for one of the world’s largest gold mines.”

“Northern Star was able to improve the AISC performance from our assets in the June quarter, reflecting the positive impact from ongoing optimisation efforts and a higher production base. Our focus remains steadfast on operational excellence to maximise cash generation.”