Sprott revised TARGET (-70c): A$9.60/sh30 Jul 2025 13:53
PaddyGall is busy but wanted to share this information
Telfer’s FY25 production came in at the lower end of guidance at 198.3koz vs 196-210 guided due to the impact of Cyclone Zelia, which resulted in deferral of some West Dome Open Pit Stage 2 ore mining and replacing feed with low grade stockpiles reducing JQ25 Au production by 13% QoQ to 78.3koz @ A$1,736/oz (-18% QoQ) with full year AISC A$1,849/oz well below guidance ($2,100–2,250/oz). GGP delivered A$487m in revenue (+6%) and A$310 (+4%) in operating cashflow contributing to a cash position of A$575m from A$398m in MQ25. On guidance, GGP moderated guidance slightly to gold production of 260-310koz at an AISC of A$2,400–2,800/oz from 300-340koz @ A$2,400-2600/oz Au announced in April ’25 following assessments of risks related to lower-than-expected grade at the newly acquired stockpiles and some pits planned for FY26.
Model changes: we adjust our forec
Overall, we think the early changes to FY26 guidance, as well as the significant beat on FY25 AISC are symptomatic of the fact that the Greatland team is still relatively early in understanding the operation and the quality of data inherited from Newmont/Newcrest. We think the long-term opportunity still skews to the positive, as there’s a significant ounce base to extend Telfer’s mine life. Moreover, despite the large quarterly swings, Greatland generated excellent cash flow this year and will be able to fund significant investments next year from operating cash flow, which we expect to extend through Havieron’s development. Relative to peers we think Greatland’s valuation remains unchallenged (0.7x SCPe NAV, >10% FCF yield); the long-term opportunity is to extend Telfer Mine Life and develop Havieron to target 400kozpa, first from Telfer and Havieron and potentially longer term as they expand Havieron to 4.5Mtpa.
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