Release Date: February 25, 2025

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

Positive Points

• Aurelia Metals Ltd (AUMTF) reported a 34% reduction in total reportable injuries, highlighting improved safety performance.
• The company achieved stronger operational performance with the assistance of higher gold prices, contributing to profitability.
• Aurelia Metals Ltd (AUMTF) reported a healthy cash balance of 96.7%, indicating strong financial health.
• The Federation project is on track and within budget, with commercial production expected in the second half of FY25.
• The company has successfully managed to lower group operating costs compared to the previous fiscal year, enhancing cost efficiency.

Negative Points

• Gold production of 215,000 ounces was slightly behind the planned target due to the sequence of high-grade gold stoke.
• The company is facing challenges with inflationary pressures affecting wages and mining construction materials.
• There is a need for significant work in terms of productivity improvement and reducing relative costs.
• The CapEx for the Great Cobar project may be impacted by the current higher inflationary environment.
• The company is still managing the transition to commercial production at Federation, with some uncertainties around timing.

Q & A Highlights

• Warning! GuruFocus has detected 5 Warning Signs with AUMTF.

Q: When is Aurelia Metals anticipating to hit commercial production for the Federation project? A: Martin Cummings, CFO, stated that commercial production is expected in the fourth quarter of the current fiscal year, with a possibility of achieving it by July 1st.

Q: How is Aurelia Metals addressing inflationary pressures on the Great Cobar project? A: Brian Quinn, CEO, mentioned that while inflationary pressures are present, the team is optimizing capital costs and the mining sequence remains similar, with efforts to mitigate these impacts ongoing.

Q: Can you explain the financing cost of $8.3 million? A: Martin Cummings, CFO, explained that this includes the performance bond margin and amortization costs related to the refinancing done in 2023.

Q: What is the expected timeline for capital expenditure on the Great Cobar and plant expansion projects? A: Brian Quinn, CEO, indicated that capital expenditure is likely to commence in FY26, with costs spread over a two-year period as the declines and shafts are developed.

Q: How does the capital requirement for Great Cobar compare to Federation? A: Brian Quinn, CEO, noted that Great Cobar benefits from existing infrastructure, which reduces capital costs compared to Federation, which was developed from scratch.

Q: Has the processing of ore from Federation continued through January and February? A: Brian Quinn, CEO, confirmed that processing is ongoing, with bulk campaigns planned for March and April to optimize ore blending and processing.

Q: Is infill drilling a normal part of mine design as resources are updated? A: Brian Quinn, CEO, explained that infill drilling is standard practice to refine resource models and optimize mine design for productivity and cost efficiency.

Q: What are the plans for the Hera processing plant? A: Brian Quinn, CEO, stated that the Hera plant is being considered for future options, including potential toll processing for third parties, as the company focuses on optimizing existing projects.

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