Release Date: February 20, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Regis Resources Ltd (RGRNF) reported a significant financial turnaround with a substantial increase in earnings, profitability, and cash generation.
• The company achieved a low lost time injury frequency rate of 0.4, well below industry averages, indicating strong safety performance.
• Gold production and all-in sustaining costs were in line with expectations, with nearly 196,000 ounces of gold produced.
• The company ended the half-year with $529 million in cash and bullion, after repaying a $300 million corporate debt facility.
• Regis Resources Ltd (RGRNF) established a $300 million revolving credit facility on competitive terms, enhancing financial flexibility for growth opportunities.

Negative Points

• The board decided not to pay a dividend for the first half, prioritizing debt repayment instead.
• There are currently no franking credits available, which may impact future dividend payments.
• The cost of sales increased by 8% due to general cost inflation and operational challenges such as deeper pits and longer haulage.
• Depreciation and amortization costs rose, affecting profitability, due to pre-production costs at certain open pits.
• The company did not fully replace depletion in underground reserves at Tropicana, indicating potential challenges in maintaining reserve levels.

Q & A Highlights

• Warning! GuruFocus has detected 6 Warning Signs with RGRNF.

Q: Can you remind us of your franking credit balance, considering the potential to restart dividends? A: (CFO, Anthony Ricki) We currently have no franking credits available. They were exhausted with the last tax refunds. Franking credits will begin again once we start paying tax. We recorded an $8 million tax payable for the half year, which will grow over the rest of the financial year.

Q: Is there an expectation for cash tax payments later this financial year? A: (CFO, Anthony Ricki) Yes, we recorded a small payable at the half year, typically payable upon the lodgement of our tax return around February each year. We expect to start making cash tax payments in February 2026.

Q: Regarding the Tropicana reserve and resource update, do you expect the underground reserves to remain at 600,000 ounces in the coming years? A: (CEO, Jim) While we didn't fully replace depletion this year, we have consistently replaced depletion in the past. We expect some variation year-to-year but remain confident in ongoing growth in reserves.

Q: Can you reconcile the operating cash flow in the statutory accounts versus the presentation? A: (CFO, Anthony Ricki) The presentation includes cash and bullion at market value, while the statutory accounts treat bullion as cash. There are also classification differences, such as corporate and interest costs being included in operating cash flows in statutory accounts.

Q: How do you view potential acquisitions versus returns, especially with rumors about an asset in Queensland? A: (CEO, Jim) We evaluate opportunities while recognizing our growing capacity to pay dividends. These considerations are not mutually exclusive, and we look at them combined.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.