East West Bancorp (NASDAQ:EWBC) Q3 2026 Earnings Call

0:00 I'd now like to hand the conference over to Mr. Suresh Vardhanagra, Managing Director and CEO. Please go ahead.

0:07 Thank you. Good morning, everyone, and thanks for your time this morning and for joining the call. I started as CEO on the 5th of October, just a little bit over two weeks ago, and I'm very pleased to be speaking with you today. It's just a little bit of feedback.

0:30 I've spent the majority of my time over the past two weeks visiting our sites. My immediate priority has always been to establish a clear view of the business by visiting our sites and by talking to as many of our people as possible and getting their perspectives on the business, including what's going well and what are some of the opportunities for us to improve. Over the last couple of weeks, I've visited our sites in Kalgoorlie, including KCGM, and in Yandall. If I look back at what attracted me to Northern Star, it is absolutely the quality of our assets and the strong foundations on which we can build. My early observations after two weeks on site reinforce the quality of Northern Star's assets and importantly the quality of our people.

1:21 They also reinforce the opportunity for us to improve consistency of delivery, strengthen accountability, strengthen capability, Adopt better capital discipline and translate all of that into sustainable cash flows and shareholder returns. If we now turn to the September quarter, for the September quarter, Northern Star sold 364,000 ounces at an AISC of $3,217 per ounce. That's Australian dollars per ounce. We've had a solid start to FY27 with all of our sites delivering in line with plans. As I mentioned earlier, consistent delivery will be fundamental to our success going forward with a focus on sustainable cash flows and attractive returns for our shareholders.

2:11 At KCGM, we completed another important milestone through the quarter with the time of the mill expansion into the existing plant. The focus now is on progressing commissioning and establishing stable, reliable operations that deliver the intended benefits of the investment. I mentioned earlier that my focus and my immediate priority was about getting to know the business. In parallel with getting to know the business, my immediate focus is also on ensuring we're set up to deliver and meet our commitments right across the portfolio. It's important to note that this extends well beyond just KCGM and is relevant to all of our sites and all of our projects and the business more generally.

3:00 At KCGM specifically, this is also more than just delivering the current stage of commissioning. The focus is also on safely and efficiently delivering stage two and on making sure we're ready to ramp up the plant and operate it consistently at design levels. From my perspective, in the short term, the focus has to be on delivery. This requires us to drive strong operating discipline, make sure we have the right capabilities right across the business, the right accountabilities, and to have a clear and relentless focus on execution. From my site visits so far, it's clear that we have a lot of opportunity and optionality right across the portfolio and across each and every one of our operations. Each operation has resource growth options to unlock value from that asset.

3:49 Making sure we're pursuing the right options and optionality to deliver shareholder value will be critical. Capital discipline is an important aspect of making the right decisions. Investment decisions have to be supported by robust business cases, attractive returns, and with a clear view of their impact on the business as a whole. I haven't mentioned Hemi so far, but that remains an important growth opportunity for Northern Star. Engineering and design work is progressing towards a final investment decision in late FY27, subject to various approvals. As with all major investments, we need to maintain discipline around capital risk and expected returns. Unlocking Hemi and setting us up to deliver it efficiently and effectively will absolutely be a priority.

4:41 Over the coming weeks, I'll continue to assess our priorities and our direction. I'm acutely aware of the importance of providing the market with clarity on our forward plan, and I intend to do so in due course. I want to complete the work of getting to understand the business and assessing our priorities before drawing any conclusions. In the meantime, our focus must remain on delivery and on running the business as well as we can and delivering on our commitments. I'll now hand over to the team who will provide you with an update on the KCGM commissioning, our operating performance, the outlook for FY27 and on the financial results. Steve. Over to you. Thanks, Suresh. Good morning, everyone.

5:27 During the quarter, we completed the tie-in of the existing circuit to the expanded plant. That was on 28 September, about two weeks later than anticipated due to minor commissioning-related issues associated with the thickener and bull mill. These issues have since been addressed. The plant has been handed over from the project team to operations, and the commissioning and ramp-up are continuing. The priority now is to resolve issues as they arise, establish stable, reliable operations. Achieving the nameplate capacity is important, but sustained performance is what will ultimately deliver the benefits of the investment. Looking ahead, Stage 2 construction is expected to be completed shortly after the end of the first half, with commissioning scheduled to commence in early second half FY27.

6:20 It will simplify the processing circuit, deliver an expected 1% to 2% recovery uplift and eliminate concentrate haulage between KCGM and GIGI. The KCGM mill expansion and readiness capital expenditure was $221 million in the September quarter. Our FY27 forecast spend remains within the stated guidance range of Australian $350 I'll hand over to Simon, who will take you through operating performance across the portfolio, including the mining and processing at KCGM and our outlook for the remainder of FY27. Thank you, Steve, and good morning. At KCGM, the focus is now on operational ramp-up following completion of the mill type.

7:13 It was very pleasing to see the processing team successfully operate the old milling circuit of Phimston and Mount Charlotte with parts of the new process circuit in parallel for a large portion of the quarter. The old circuit of four mills and associated flotation areas has now been turned off with the KCGM processing team focusing only on the new flow sheet. We're continuing to clean out mill material from the old circuit as we capture all remaining gold in the circuit. The old redundant parts of the plant will be fenced off From an open pit mining perspective, we mined 23 million tonnes for the quarter, which was on plan. This was despite enduring a very wet quarter with 125 mils of rain in Kambuli.

8:05 Golden Pike North continues to provide a source of high margin ore, while waste dripping at Femison South continued as planned. Underground mine development achieved a record of 10.3 kilometres in the quarter, across the Fimmerston and Mount Charlotte mines. This is a very important lead indicator for increasing the stoveball supply at a higher grade, which will lift the average mine grade from the underground mines in the future. Underground mine grade at Casey Gem is 1.7 grams per tonne. Casey Gem, together with Karasu Dam and Kalgoorlie Operations, which make up Kalgoorlie Production Centre, generated mine operating cash flow of Australian $433 million and a net mine cash flow of $15 million after $418 million of growth capital investment, primarily associated with the Casey Gem Mill expansion.

9:04 Gold sales were 194,000 ounces at an all-in sustaining cost of $2,919 an ounce, reflecting planned shutdowns and the impact of the KCGEM commissioning on grade and recovery. I would like to touch on power across the Goldfields. During the quarter, we experienced one major Western Power fault in late August. However, at that time, we had two of our Parkston generators online. The interruption did cause the KCGEM milling circuit to trip. However, a restart occurred quickly and we were reconnected to the grid in the following two hours. Historically, the power outage issues increase over the summer months and associated downtime, not over the winter months.

9:55 At Yandel, the production centre generated mine operating cash flow of 160 million and a net mine cash flow of 138 million after 22 million of growth capital investment. Gold sales were 118,000 ounces, at an all-insustaining cost of $3,687 an ounce, with planned shutdowns at Jundee and Thunderbox affecting the quarter. At Jundee, a key highlight included improved delivery consistency following the operational review. Mine grade of 2.5 grams per tonne was in line with the plan and is expected to increase in the second half, reflecting a higher contribution from Griffin, Cook, and the Armada ore sources.

10:45 Meanwhile, Thunderbox delivered record quarterly gold sales, supported by improved feed grades, largely from Aurelia and a drawdown of gold in circuit. The post plant at the Wonder underground mine was commissioned during the quarter, supporting ore body recovery and future mining productivity. At POGO, our mine operating cash flow was US $63 million, and a net mine cash flow of US $39 million after 24 million of growth capital investment. Gold sales were 53,000 ounces at an all-in sustaining cost of US $2,307 an ounce, reflecting the plant processing plant shutdown, infrastructure rehabilitation of the underground ore bin and lower grade and recovery.

11:40 Mine grades of 5.9 grams per tonne below the reserve grade of 6.8 grams per tonne were in line with expectations, reflecting the mine and stope sequencing and are expected to remain variable as we saw in FY26. Across the portfolio, our focus remains on reliable operating performance, cost control and delivery against FY27 guidance. At Casey Gem, the priority is to establish sustained processing performance as commissioning progresses on the new circuit. At POGO, the return of the underground ore bin handling infrastructure is expected to support improved mining rates throughout the December quarter.

12:28 I'll now hand over to Ryan to cover the financial results, cash flow, and capital position. Thanks, Simon, and good morning, everyone. As Suresh highlighted, we've had a great start to the year. Turning to the financial results, I'll focus on the group's cost base, cash flow, capital investment and balance sheet position. Total group cash operating costs reduced 3% quarter on quarter to $893 million, while total group all-in sustaining costs were broadly unchanged at $1.17 billion. Total group all-in costs, which includes growth capital and exploration, reduced 5% from the prior quarter. Importantly, all three production centres generated positive net mine cash flow despite the planned shutdowns, commissioning activity and infrastructure works undertaken during the quarter.

13:28 After $113 million of corporate tax payments, $51 million in exploration and $76 million in equipment finance and lease payments, underlying free cash flow was an outflow of $31 million Australian. The company remains in a strong financial position with cash and bullion of $1.2 billion at 30 September and substantial available liquidity to support the business and growth pipeline. Looking through the balance of FY27, We expect operating and cash flow performance to strengthen, consistent with the second half weighting embedded within our guidance. This is expected to be supported by the progressive ramp up of the expanded KCGEM plant, a reduction in KCGEM mill expansion expenditure, completion of the key underground infrastructure works at Pogo, Turning to capital investment.

14:28 Sustaining capital was $220 million for the quarter, with the increase from the June quarter primarily reflecting higher investment at Thunderbox, Pogo and at Jundi. At Thunderbox, this included deferred stripping at Bannockburn, together with tailings capital and tank refurbishment works. At Pogo, expenditure focused on key infrastructure projects including remediation of the underground ore bin which is scheduled to return to service later this month. At Jundee mine development progressed in line with plan with development activities continuing to open up future mining areas that support the operation through the second half of FY27. Growth capital investment across the operating centres totaled $473 million for the quarter At KC Gem, investment continued across the Phimiston South cutback and underground development at Mount Charlotte and Phimiston, while KC Gem mill expansion and readiness expenditure totaled $221 million.

15:29 We expect expenditure associated with the mill expansion to reduce materially during the December quarter, with Stage 2 commissioning scheduled to commence early in the second half of FY27. As commissioning progresses, the main focus remains on establishing stable and sustained operating performance from the expanded plant. At HEMI, engineering design permitting activities continue to progress with final investment decision remaining on track for late FY27. Turning now to the balance sheet, subsequent to quarter end, we added a new 500 million Australian tranche to our revolving credit facilities on similar terms, maturing in October 2029. This increases total bank facilities to 2.25 billion.

16:17 During October, we utilized 500 million of those facilities ahead of the FY26 final dividend payment. This was a prudent liquidity management measure that maintains our financial flexibility while retaining substantial cash on hand to support our investment program. No shares were acquired under the buyback program during the quarter. The program remains open and available as part of the company's capital management framework and of course is subject to the company's security trading policy. Our capital allocation priorities remain unchanged with a continued focus on balance sheet strength, disciplined investment and growth and delivering returns to shareholders. Appreciation and monetisation for the quarter was just over $1,050 per ounce within our FY27 guidance range of $1,000 to $1,200 per ounce.

17:09 The group also recorded a non-cash inventory credit of $37 million, principally reflecting stockpile movements at Casey Gem and Thunderbox operations. From a tax perspective, we maintain FY27 cash tax guidance of $450 million to $550 million, with $113 million paid during the September quarter. There has been no change to our current estimates for landholder duty associated with Le Gray and Saracen transactions. and a reminder, the company will pay its semi-annual coupon payment and annual insurance premiums during Q2. Finally, we continue to unwind the hedge book during the quarter. At 30 September, remaining commitments totaled 648,000 ounces at an average price of 3,423 per ounce.

17:55 I'll now hand back to Darcy for Q&A. Thanks very much. Thank you. If you would like to ask a question, please press star 1 on your telephone and wait for your name to be announced. If you would like to cancel your request, please press star 2. If you are on a speakerphone, please pick up the handset before asking your question. Your first question today comes from Kate McCutcheon from Bank of America. Please go ahead.

18:20 Kate McCutcheon Hi, good morning, Suresh, and good to connect again. You've outlined your priorities today in the release we've got, but I guess how do we think about the timing of some of those things and that list? If I think about it, I guess you've got goldfields in the background there. There's your endorsement of the FY27 guidance and the market's expecting a multi-year outlook. Can you just kind of step through maybe those priorities again, some of the key challenges and how we should think about the timing there?

18:52 All right, thanks, Kate. And yes, it's good to connect again after quite a while. That's a fairly all-encompassing question, so I'm going to try and sort of tackle it bit by bit. I'll just sort of re-emphasise the point that I'm just into week three of my tenure as the MD and CEO of Northern Star and that my immediate focus and immediate priority is has been to get out to the sites and start getting right around the business. There's a lot of aspects to the business that I still need to understand better to really calibrate our priorities and make sure that we're in a position to deliver against those priorities.

19:37 As I mentioned at the beginning of our call today, The immediate focus is on delivery. We've made a series of commitments, be it production commitments or timing commitments that are attached to the KCGM mill expansion, attached to production, attached to growth projects. And my focus is very much on working with the team to make sure we are positioned to deliver on those commitments. And that's the focus. We've made a commitment. We need to consistently deliver against those commitments. In terms of FY27 guidance, I'll probably firstly touch on the performance in Q1 by taking into account that Q1 was a transition quarter for the business, especially with the time of the mill expansion.

20:31 And we were able to deliver in line with our plan and in line with guidance for Q1. All of our forecasts and projections demonstrate that we will deliver in line with our plan for FY27 and in line with guidance for FY27. There's nothing that I've seen working with the team that would suggest differently. What I will say, though, as we work our way through these things, if there are any emerging risks that cause us to rethink Thank you very much. Our priority is absolutely to work in the best interests of our shareholders. And right here and right now, delivering on our commitments is the biggest lever of delivering in the best interests of our shareholders.

21:45 I think I've covered most of the topics. If I've forgotten anything, Kate, just please jump in.

21:51 Okay, thank you. That's good. We threw you in the deep end there. You can give me a score later. Just on the super kit, compared to where the team thought you would be versus when you came, or not you, but the team came with guidance, have we had any changes to the timeline there? And then just the speed, grade, and recovery were both those metrics in line with the plan for commissioning, if you can just help me

22:19 I might just throw it to Simon to answer the question in detail, and he'll probably rely on Steve to add a little bit more colour to a couple of items. But then I'll make some just overarching comments at the end. Yeah, thanks, Kate. Simon here. So, look, to start with, I'd just like to really highlight, you know, how much of a high-quality build the new process plant is. And, you know, I think it's really important You know, certainly for the team there at site, it's a major step up from the 37 year old plant, which we turned off on the 20th, 21st of September. So really great to have the old plant behind us and have the full team just focused on the new plant.

23:07 In terms of, you know, details around the plant, look, the crushing circuit is certainly performing Very well, there's minor areas to tidy up there, but fundamentally the crushing circuit is fully commissioned and performing extremely well. So very, very happy with that. In terms of the rest of the process plant, the new plant, it's really now running it as an integrated circuit. So that's the key. We've commissioned, Steve and his team have commissioned the various elements of it and we've run up You know, the ball mill, the float circuit, the gravity, all the different elements of it. And it's really only on the 28th when we tied in the Fimmerston, the old Fimmerston sag into the new circuit. It's now working through, you know, screens, densities, mill weights, all those sorts of elements and really ramping it up, focusing on run time and commissioning all those various elements as an integrated process plan.

24:16 Look, in terms of the mining, mining had a very good quarter. The open pit delivered despite a lot of rain, which was fantastic to see. Golden Pike performed to plan. The stripping in the southern end of the pit was on plan. And the underground had a great start to the financial year. really, really happy with the mining inputs and, you know, the ounces that we put onto stockpile. It's now really focus, all hands on deck, on the new process plant, which we, you know, started on the 28th. I think that answers most of it. I might just go to Steve if there's any more colour on the commissioning.

25:01 Yeah, I think, thanks Simon. Okay, and I think the things that we're seeing today are just the small but annoying disruptions. It's always a way, and, you know, billion-dollar-plus plants, it's a couple of hundred-dollar items that take things down or things you just need to tune and rectify. So when we look at things like the ball mill, you know, motors and stuff like that, we had to basically get the temperature within the oil. We've had to do insulation. We've had to make the pumps continuously run and stuff. It's just taken time to get those sort of bugs out. But we are very pleased we haven't got perpetual problem. And as Simon said, a lot of time and effort has gone into the design of the plant. His team was heavily involved in trying to get most of the bugs out in a design phase and now we handed them over and it's great to see the full team focused on delivering the one future.

25:51 Maybe if I could add just a couple of observations from my part. KCGM was the first site that I visited and going to have a look at the plant expansion was one of the priorities while I was on site. For those of you that know me, whilst I've got a lot of operational experience, I've also got quite a bit of experience in building and commissioning Greenfield and Brownfield major projects, and I can list some of those right at another time. But what I saw in terms of the quality of the engineering, the quality of the construction, and the quality of the plant that was built is as good as anything else that I've seen in my career. We are at the very early stages of commissioning, and it's only normal for things to be quite variable at this stage.

26:43 We get some good days, we get some not so good days. But nothing that we're seeing at the moment, just to reinforce Simon and Steve's comments, is suggesting that there's any fundamental issues with the quality of the engineering, the design, or the quality of the construction, the sorts of issues that we're facing. and what you'd expect at this early stage of commissioning.

27:07 Okay, that's helpful. Thank you. Thank you. Your next question comes from Daniel Morgan from Baron Joey. Please go ahead.

27:17 Hi, Suresh and Tim. I just wanted to chase or follow on from Kate's question regarding the plan from here. What is the latest view of introducing higher grades to the processing plant over time? I imagine you would expect you put low grade in right now and you slowly bring that up when you have stability. I imagine you haven't got recoveries and stability where you'd like it yet. So putting all that together, I would imagine you would expect the December quarter to be the low for ounce production is Is all of that accurate, or could you help me calibrate what the sample looks like? Some. Dan, so in terms of the recoveries, what we saw in Q1 was very, very promising in terms of the float circuit performance on not a lot of data set, you know, in terms of an integrated process flow sheet. So you can see that, you know, recovery was 76% for the quarter.

28:21 but early on we are seeing very good float recovery grade mass pool. So it's really around just stabilising gravity circuit, running as an integrated circuit and getting the grind right. But ultimately we are seeing good recoveries. We have got a lot of high grade material there. So sometime during the quarter we will start to increase the blend of some of that high-grade open-pit dirt and underground feed back into the process plant. So we've got the luxury of this big stockpile. Mining's going extremely well. So it's when we build the confidence on the flotation and the gravity circuits, really then it's start to increase that high-grade back into the plant.

29:15 So it's going to be progressive over the quarter.

29:22 Okay, thank you. And then just a little bit of detail on Karasu Dam. You call out Quina as a new ore source, as an underground mine. Can you give us an idea of the scale of this contribution in terms of tonnes grade and duration to the group? Yeah, sure. In terms of Quina itself, so as we mentioned in the quarterly, we're digging the box cut. at the moment for Kina, expect to finish that over the remainder of this quarter. And then sometime in H2, we hope to cut a portal there and start that particular mine.

30:10 In terms of future ore sources at Karasu, it won't feature in FY27, so it is in future years. But look, at a high level, Reserves-wise, it's sort of a couple of million tonnes and a higher grade. So, you know, around that three to three and a half grams per tonne for Kena as a starting reserve.

30:38 Okay. Thank you very much for your perspectives, Simon and Shrek.

30:42 Thanks, Daniel. Thank you. Your next question comes from Hugo Nikolaki from Goldman Sachs. Please go ahead.

30:53 Morning, Suresh. I'm Stephen. I've brought up the team. Look, firstly, just to pick up on Kate and Dan's question, I'm sorry to leave it at a point on the KCGM ramp-up, but if I look at the timber quarter, look, probably part of that performance driven by the two and a half weeks of continuing to run that old plant, which probably added maybe 20,000 ounces to the quarter on the back of the envelope. Can you just maybe talk through a little bit more sort of where you expect Utilisation on the new plant to be sort of in the coming quarters. Do we just sort of shift to the right, that sort of timing of ramp up where utilisation is probably, you know, maybe 70 to 80% in the December quarter and then continues to improve through the rest of FY27? And then just on that grade piece, is a gram sort of too low as you process that mineralised waste and ramp up through the December quarter? Or should we be thinking, you know, that you exit the quarter closer to your feed grades that you had in the September quarter?

31:46 Thanks. Yeah, thanks, Hugo. A few in there. So in terms of utilization, really, it's building up on what we've talked about previously, which is a ramp up curve for a process plant of this size. So we're trying to, you know, aim at sort of 60 percent and then it ramps up progressively as we start to iron out those small things that Steve was talking about that just take us down. So that's going to be a journey over the rest of FY27. Q2 will get some good momentum in terms of ramping up the process plant and really H2 is where we've had a decent amount of time running the integrated process plant. And like I said before, it's just getting mill weights, densities, commissioning those screens so we get the run time that we expect out of those elements of the plant. You are going to see it ramp up from the 2.5 million tonnes we did last quarter.

32:53 The recovery will just increase from where we're going. And once we get good confidence around those elements, the circuit, the float and the gravity, then we will introduce the feed. So on a quarterly basis, you're going to see the feed probably go, The head grade will go down from this quarter because we ran most of the quarter sort of business as usual on the old plant while we're waiting for the tie-in. So the feed grade will come down, the volume of tonnes will go up, and then it will stabilise and it's just more tonnes going forward. Sorry, Hugo, perhaps I'll just...

33:42 Perhaps I'll just reinforce that in terms of what we're seeing right now and noting that it's still quite early in the time process, yes, there's good days, yes, there's bad days, but it's consistent with what we would expect for this stage of commissioning and that our view is that where we're at right now puts us in a good position to deliver on four-year guidance and therefore whatever people would considered quarterly results to be as well in order to deliver on that four-year guidance.

34:18 Yeah, I got it. That's helpful, Carla. And then maybe just one on Dundee. It looks like your mining rates were pretty flat quarter on quarter as Dundee and Ramon were ahead of plan, but your mining costs actually came down materially in the quarter. Just wondering if you can talk to what drove that and if the $105 a ton you're seeing is sustainable from here or whether you expect that to then revert back to more like that $120, $150 a ton going forward? Yeah, there's obviously quite a bit of change we enacted over the last quarter of financial year 26. And during the quarter, we did see, you know, some of those mining costs start coming down and stabilising. You see the quarterly average. But I'm very happy with the Jundi operation in terms of that transition to what we see at the moment as the game plan for the Jundi assets.

35:11 But, you know, we made some pretty significant changes there in Q4 leading into Q1. So it was around 20, 22 bits of major equipment came out of Jundi and, you know, around 190 personnel were pulled out of that asset to reset the cost base to where we see it is today. There are absolutely zero redundancies for all of that, and everyone was dispersed, contractors and ourselves, across the rest of our business. So that was a great result, well executed by the team. Mining costs will stabilise around where they are at the moment, and we'll focus on the drilling and execution of the plant.

36:02 That's so powerful. Pass it on. Thank you. Your next question comes from Matthew Fryman from MST Financial. Please go ahead.

36:13 Sure. Thanks. Morning, Suresh and team. Can I firstly ask at Pogo, the Orbin and Orlage infrastructure works that you're conducting there, what will they enable specifically? Do they deliver any potential productivity improvements? Do they unlock any The Pogo bins had 20 years of material go through that. So at the end of the day, it worn out and many more.

37:04 We've refurbished and bolted and meshed that with fibrecrete all the way to the bottom, which took most of the quarter. And really that's to put another 20 years of life, probably 30 years of life, back into that bin. So it's more risk mitigation for large slabs or things falling off the bin. The team's worked on that for two years and, you know, really, really, they've executed extremely well. I saw it a few weeks ago when I was at Pogo, just the last parts of the refurbishment and that's finished and behind us now. And, you know, by the end of this month, we'll be back on the Orbin, which will be fantastic. So that has made quarter one as planned difficult to execute because all the material has been going outside the portals, getting crushed, and then sent up to the mill in trucks and put through the e-feeder. So the blue tube that people have seen on various pictures of Pogo has been out of action while we've been finishing the bin.

38:20 So that's put pressure on the mining sequence. as planned. We did plan this for a long, long time. So Q1, really happy with POGO and the team and how they've delivered it. Getting back on the all bin will reduce trucking hours, TKMs, speed up the cycle and get back into the higher grade areas. As you saw on FY26, you know, grade was quite variable between 5.5 grams through to 7.8 grams, and we averaged 6.7 for the year against a reserve of 6.8. So expect to see that same variability, but it will be easier for us going forward as we're back onto business as usual for winter.

39:11 Got it. Thanks, Simon. Maybe secondly, looking across the portfolio more broadly, obviously we had an operational review at Jundi earlier in the year, which the market didn't really get any kind of visibility on the specific outcomes apart from the additional commentary that you just gave to an earlier question, Simon, so I appreciate that. I'm wondering, is there any asset level operational reviews that are still ongoing and could these result in any asset sales or kind of rethinking of the portfolio? Are there any active processes that might result in a potential asset divestment? Thanks. I'll speak operationally first and then probably hand over to Suresh. But in terms of reviews of assets and how mines are performing within each particular production centre, that is ongoing.

40:04 We do that business as usual. So we are always looking very closely at the detail of each specific mine. Is it performing to plan? Do we need to adjust things? where are the opportunities we can unlock ahead of plan. So I wouldn't say we don't do that work and then we're waiting for a review. We're consistently always reviewing the performance of the individual assets that make up feed into, you know, one process plant in particular. And it is ongoing. So John Dee had that review last year. really happy with the outcome and how the teams put that together and executed it and it is something that we do all the time.

40:52 Thanks Simon and if I could build on that with a couple of comments. In the two weeks that I spent on site meeting each of the site teams it was clear that there's an active process by the site teams and the planning teams to look at each of their individual assets and assess and reassess the way we're operating those assets and is there a way for us to unlock further value or improve the resilience of those assets. The John Dee review that Simon mentioned earlier is the product of those types of assessments. Obviously, I'd like to apply my own lens to it as well with time and it's an area that's high on the agenda and just to satisfy ourselves that we're looking at it from every possible angle.

41:38 and making sure that we understand the resource endowment and the opportunities for us to more effectively and more value accretively tap into that resource endowment. At a portfolio level, again, that's something that Northern Star does continuously and actively. The board highlighted that a few times in the recent past. Where I'm at right now is I'm looking at some of that historical work as well as the current work to understand what the conclusions from that work were and what additional work might be necessary and whether that triggers us to think differently about things.

42:22 Got it. That's pretty clear. Thanks, Suresh, and thanks, Simon, for your comments also. Thanks, Matthew. Thank you. Your next question comes from Levi Spry from UBS. Please go ahead.

42:37 Good day and good morning. Thanks for your time. Maybe just one quick one on Hemi and then maybe come back to that strategic question you just had. In terms of your confidence around the FID, late FY27, can you just sort of work back from there? So you started these trials. Can you just play the movie as to what happens in between interactions with the regulator? I feel like we understand the permitting process a little bit better on our side of the fence.

43:09 Sure. I might get Steve to give you a little bit more detail on where we're at and what the process between here and FID and late FY27 is, and then I'll add any comments if necessary. Thanks, Suresh. Yeah, Levi, At HEMI at the moment, what we actually have active in the field is the completion of that pumping trial. So we're basically taking water from the mine area. We pump it out about seven kilometres and the test is really about the reinjection and can the system we've designed get the reinjections that we assumed in terms of because that's a fundamental thing to be known and defined and that wraps up within the next three weeks of a three-month trial. So that's everything we've seen to date has been very pleasing and we're confident in what we've seen subject to no surprises in the next three weeks but that's all progressing to plan. You saw that we released the reserve earlier this year and a lot of the work we're doing at the moment is about Getting the metallurgical parameters, the mining schedule and some of the changes we've made to the plan to bring that together as an integrated package.

44:18 The idea is that we'd have that pretty well locked down by this calendar year and we build into an updated feasibility by the end of, say, Q3. And that is the foundational piece that goes into a fit plan. Now, I must counter that. We've got new board members. We've got Jeff Quartermain on our committee, etc. We've got Suresh. We'll bring that all up to speed. But that's the plan as it stands today. And we're very pleased to have fresh eyes looking at the project and looking at what we're doing. It's all going very well to this stage.

44:49 If I could just sort of reinforce a couple of comments that Steve made. From our perspective, HEMI is a key part of Northern Star's It's one of the most compelling organic growth opportunities that we've got within the portfolio and a well-recognized value lever. So we are doing everything we possibly can to get to the point where we can make FID in late FY27 and advance the project. Earlier in the introductory comments on the call, I said that my focus at the moment is on delivery. It's not just on operational delivery. It's also on delivery of all of our project milestones and commitments. And this is one of those key ones that I'm going to be putting a lot of attention into.

45:39 So, you know, Steve and the team are working hard to deliver on that timeline and to advance the project in line with our aspirations.

45:53 Yeah, that's great. Thanks for the extra colour. And then, I mean, maybe just tying this into the previous question there from Matt, or maybe the earlier one around expectations on the multi-year guidance, can you sort of just help us think about those key value levers that you call out now, how you're prioritising them and what, I guess, maybe, you know, any sort of CPs might be in terms of how we should think about timing?

46:22 Yeah, the focus is very much on delivery at the moment. Firstly, focusing on the immediate milestones that are in front of us, as well as focusing on some of the longer term milestones and making sure that we're doing everything we need to do to be able to meet those commitments and deliver on them, and that we're set up to deliver on them effectively as well. I'm acutely aware that there have been in the past some expectations built around us releasing medium-term guidance, perhaps even conducting market days and investor visits. To be honest, I haven't actually turned my mind to those things just yet. I haven't considered them at all. I've sort of explained a few times where my focus has been so far. That's something I'm going to have to take on notice and engage with the team and the board on and come back to all of you with a more considered answer.

47:18 No problem. Thank you. Thanks for your time. Thank you. Your next question comes from Jonathan Sharp from JP Morgan. Please go ahead.

47:31 Yeah, morning, Suresh, and welcome. And thanks for taking my questions. Just first question on cost. You've said that you expect costs to improve through the year, which I think is expected, but are you just confirming the planned profile or is September giving you more confidence in a better full-year outcome? Are you expecting December quarter to be lower than the September quarter or is it second half? Brian? Hi, Jonathan. Yeah, look, I think... Yeah, I think it's all to do with the ramp up at Casey Gem. I think, look across the portfolio, the assets are quite stable. I mean, Simon's spoken to Pogo. So, you know, the second half certainly from a unit cost perspective will be better because we'll have, you know, higher tons, better grade.

48:24 So that, we're expecting that to lower significantly. As I said, across the portfolio, I would say they're broadly going to remain sort of consistent, subject to macro costs and changes like oil, gold price royalties, things like that. At Casey Gem, though, yeah, our expectation is that that cost per ounce does drop as we increase throughput and availability rises.

48:51 Okay, and just the, you know, nothing has changed in terms of the original plan and and potentially you know September quarter giving you more confidence is there anything there um it gives us confidence we'll stay within our guidance which is what we've stated today um you know so as i said i think stability helps the outlook on on these things jonathan so again If there's no macro changes, you know, oil is pretty volatile. Is that going to blow out our costs? Probably not, but it impacts them. So I guess what I'm saying is we've got confidence that we're going to meet our guidance in our cost base for our first 90 days. And we've got confidence in the second half of what we see in the plant.

49:40 Okay, great. Thank you for that. And just second question, just really interested in your first impression, Suresh. I appreciate you've only I'll start by answering the back end of the question before the front end of the question. I'd absolutely, in 12 months' time, want to have, together with the team, achieved consistent and

50:19 Thank you very much. and absolutely sort of advance unlocking and realising the full value of HEMI. So at a high level, those are some of the priorities. That's not everything, but that's where I'd like to sort of see ourselves in 12 months' time. And all of that is really designed to deliver consistent, reliable and attractive returns to our shareholders. In terms of my first impressions of the business, having spent a couple of weeks on site, I think there's a lot of positives to really build from.

51:12 I was particularly impressed by the enthusiasm that a lot of our people have towards the work that they're doing, the sites that they're operating in, the opportunities to do things differently, and the business more generally. was infectious. It's important for us to make sure that that enthusiasm is absolutely directed at the right issues. I'm not saying that it isn't, but it's absolutely important for us to make sure that that enthusiasm is directed at the right issues. I mentioned earlier that the two weeks on site just reinforce the quality of our assets and the portfolio more generally, not just in KCGM, but more broadly, but absolutely KCGM.

51:59 There's no doubt in my mind it's a The plant expansion quality is as good as I've seen, which gives me a lot of confidence in that asset, really generating very, very attractive revenues going forward. You know, if I sort of think about it outside of those key points across all of the sites, as I mentioned earlier, I saw lots of opportunities for us to Thank you very much. enhance what is already a high focus on costs, execution, and adopt some capital discipline. If we look at those resource extension opportunities, there's lots of opportunities in front of us.

53:01 We just need to make sure that we are focused on the ones that are going to move the needle the most and make the biggest difference to the business and to the shareholders more generally.

53:12 Okay, thanks. And maybe I'll just follow up with something there. Just turnover. How's turnover looking? What are you thinking about turnover? has it slowed down? Just any update there?

53:23 Well, maybe I'll have a first crack at that and then I'll let Simon sort of step in with any other comments. If we look at our turnover rates, just particularly over the last quarter, we've seen that tapering off, which is a good sign. It's not necessarily reducing it, but it's flattened off in terms of turnover rates. Maybe it's a product of some of the other labour market action that's happening in Western Australia at the moment, but I doubt that. If I look at turnover more generally, and having had the experience recently managing a fairly global portfolio with assets right around the world, what I'm seeing in our operations isn't particularly different to what we were seeing in other Australian operations in my previous role, and in fact in some other parts of the world as well, and particularly in Canada. Turnover is becoming an industry-wide industry.

54:20 That doesn't exempt us from focusing on it and from making sure that we establish a culture in the organisation that really engages our people and a culture where they wake up and want to come to work every day and establish a culture where they see growth and career opportunities in front of them within the organisation as well. The current noise around the company, the market activity around the company is important to also recognise as we're doing that. It does create a lot of anxiety and uncertainty for people. And in my experience, the best thing that we can do in these sorts of situations is communicate frequently and transparently and keep people focused on the things that they can control, which is delivering outstanding results and delivering on the commitments that we've made.

55:11 Simon, I'm not sure if you'd like to add anything to that. I think that's pretty comprehensive. Look, our turnover has stabilised in that 25% to 30% if you had to pick a number. It varies depending on work groups. There's obviously a lot of operations kicking off around Western Australia in particular. So we've seen it flatline. We are continually working across the business to try and provide internal opportunities for people to move within the business, which rather than leave the business, to get the same opportunity. So we work through those areas consistently.

56:00 It is a challenge. It's higher than it has been a couple of years ago, but we've got to step back and have another look at it. But If I come back to Jundi, there was a great example of, you know, we had to resize that particular operation and there were zero redundancies. Everyone was redistributed across contractor workforce and their own back into the business. So that is the strength of having multi-assets across the portfolio. Constantly looking at how we improve turnover. Are we competitive to others in the market? And I don't think that's going away anytime soon.

56:47 Okay, great. Thanks for the colour. Appreciate it. Pass it on. Thank you. Your next question comes from David Radcliffe from Global Mining Research. Please go ahead.

57:00 Hi, good morning, Suresan team. I want to start with the KCGM operating question. The Mount Charlotte and Finstern underground volumes during the quarter did look reasonably weak to what we've seen recently. So it'd be good to understand the drivers there of how the volumes step up over the balance of the year to meet that targeted run rate. And then maybe Suresh as well, it'd be interesting to get your initial thoughts on that underground opportunity and if you're comfortable with the plans to more than double the underground mining rates in just a few years. Yeah, thanks, David, Tom. Look, in terms of performance for quarter one, if you look at the combined, it's at that 3 million tonne run rate. That's as per our plan. So, yeah, in fact, we actually delivered slightly more than our internal plan for quarter one at combination of Mount Charlotte and Fimston.

57:56 So really happy with where we're positioned for mining rates at the underground. And as I touched on earlier, you know, we've been seeing the underground development ramp up. That really is critical for lifting the stoping at Phimiston over the course of the year, which you'll see. And, you know, more consistency from Mount Charlotte. So in terms of the Q1 delivery, couldn't be happier. with what the team produced in Q1. And we will see that ramp up over the course of the year. And as I've touched on previously, it is lumpy as you bring on new stoping areas, but more and more development is getting into more stoping opportunities.

58:44 Production drilling's on track. So we're positioned well for the ramp up at Coastal Gem.

58:53 As part of my time in KCGM, we did take the opportunity to go and visit the Phimston Underground operation. The team also took the time to take me through their plans and what that ramp-up plan looks like. As Simon mentioned, in terms of achieving that ramp-up, having had similar experiences to this elsewhere, it's at the moment very much about getting that development in front of you and creating access to those stopes that will deliver those higher run rates. And if we look at our development rates as an organization and compare them to development rates more generally, they compare extremely favorably with some of our development rates significantly exceeding benchmarks in a lot of cases.

59:42 In terms of my focus on delivery, which I've mentioned on a number of occasions throughout the call today, that's my immediate priority. But I really want to work through all those forward plans in detail with Simon and the team and understand what needs to happen when are we positioned to deliver on those milestones the way we need to be and what else do we need to do to give ourselves certainty that we're going to meet all of those objectives.

1:00:13 Okay, thanks. If I can just follow up on the cap extent of the expansion. So we're now just a few million dollars below the bottom of the forecast project spending, 1.8 billion, and that budget has a pretty narrow capital range. So what are the risks here that we could potentially go above that targeted spending coming months as we complete stage two? And then maybe on that, if there's any potential capital offsets, you can see within that readiness capital budget. Steve? Yeah, I guess what you're seeing in the project is we are getting into the final stages of stage two. It takes time because the workfronts actually shrink down. But we're at the point today where we're into the single digit percentage to go to complete.

1:00:59 And that's why the numbers wind off quite rapidly. Now, can they go above that range? Yes, they could if we materially got lower productivity, etc. But based on what we see today, we're comfortable with that guidance as we head into the year. And the numbers drop off significantly. We're less than one third of the amount we had during the peak of the project and winding down rapidly.

1:01:27 Thank you. I'll pass it on. Thank you. There are no further questions at this time. I'll now hand back to Suresh for any closing remarks.

1:01:38 Thanks everyone for your time this morning and thanks for the conversation and the questions. We really appreciate the continued interest in Northern Star. I think it probably came through quite clearly throughout our conversation today. I'm really excited about the future of our business. There's no doubt in my mind that we have a high All of the asset base, we have high quality people and significant opportunities for us to deliver shareholder value in the future. Right now, I'm still trying to get my head around the business and do everything that I possibly can to get up the curve as quickly as possible, supporting our people and ensuring that we deliver on our commitments.

1:02:23 Those are my main priorities and will remain my immediate main priorities. By maintaining strong operating discipline, capital discipline, we can build on the foundation that we have in front of us and deliver sustainable cash flow and attractive returns for our shareholders. I look forward to all of our future interactions and updating you on the progress that we make in due course. Thank you and have a great day.