Ora Banda delivers record revenues as WA underground mines ramp up

Ora Banda has delivered a standout half-yearly result, with stronger gold prices and higher sales volumes. A successful ramp-up of its second underground mine, Sand King, also contributed to the numbers, driving record revenues, earnings and cash generation compared with the previous corresponding period. 

Revenue for the six months surged 80 per cent to $336.3 million from $186.4 million, underpinned by gold sales of 62,583 ounces, which were 31 per cent higher year‑on‑year, while the average realised gold price climbed 45 per cent to $5652 an ounce.

The stronger pricing environment and higher sold ounces flowed through to a 106 per cent lift in EBITDA to $173.2 million and an 89 per cent increase in net profit after tax to $96.3 million, despite the inclusion of a non‑cash tax expense in the current period.

Operating cash flow also joined the party, more than doubling year‑on‑year to $184 million and lifting its cash balance to $155.4 million at the end of December, compared with $84.2 million in July. 

Net cash inflows of more than $71 million during the half comfortably supported higher capital and exploration spending as the company continued to invest heavily in underground development, infrastructure and exploration drilling.

Production performance strengthened materially over the year, with total gold produced, including attributable third‑party ounces, rising 32 per cent to about 62,600 ounces. 

Processing at the Davyhurst plant remained robust, with milled tonnes increasing 9 per cent and recoveries improving to 92 per cent, offsetting a modest decline in head grade. 

Ora Banda Mining managing director Luke Creagh said: “The half year further demonstrated the Group’s operational strength with its second underground mine, Sand King, achieving capital payback within 12 months of portal establishment. This follows Riverina Underground, which, in FY25, achieved payback in 18 months. These outcomes contributed to the generation of more than $71 million in free cash flows, with a closing cash position of $155.4 million.”

Third‑party processing campaigns at Norton Gold Fields’ Paddington mill also made a meaningful contribution during the period, delivering more than 10,000 ounces and adding further flexibility to the operating platform.

Underground mining has continued to drive the company’s growth profile. Riverina produced fewer ounces year on year as it progressed through a lower-grade sequence. However, development rates have since improved and the operation is starting to deliver stronger output as mining sequences normalise. 

Sand King, which was in early development a year ago, has now emerged as a major contributor. The mine produced more than 32,000 ounces in the half and achieved full capital payback within 12 months of portal establishment, underscoring the effectiveness of Ora Banda’s revised underground strategy.

All-in sustaining costs increased compared with the prior year, rising to $3188 an ounce, reflecting the ongoing ramp-up of Sand King, higher third-party processing, haulage costs and increased royalties associated with stronger gold prices. 

Management expects cost performance to improve as underground production rates lift, one-off development costs subside and mining sequences move back into higher‑grade zones.

Exploration momentum also accelerated over the year, with $36.5 million spent during the half as part of a $73 million full-year program focused on extending the mine life at Riverina and Sand King. Funds have also been deployed to drill out a pipeline of nearby high-grade growth targets, including Little Gem, Waihi, and Round Dam. 

Subsequent to period end, the company approved additional capital for studies that could see capacity at its 1.2-million-tonne-per-annum Davyhurst plant more than double to three million tonnes per annum.

With record earnings, continued exposure to the gold price, a strengthened balance sheet and more than $200 million in available liquidity, including an undrawn $50 million revolving credit facility, Ora Banda heads into the second half in rude financial health.

The strengthened balance sheet also leaves the company well-funded to push deeper into its multi-mine underground growth strategy.

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