Alkane Exploration Aktie

Good day, and thank you for standing by. Welcome to the Alkane Resources Q3 Full Year 2026 Operating and Financial Results Conference Call and Webcast. [Operator Instructions] Please note that today's conference is being recorded. I would now like to turn the conference over to Natalie Chapman, Corporate Communications Manager. Please go ahead.

Hello, everyone. Thank you for joining our call today. Some housekeeping items to note. The accompanying presentation for today's call is available for download from the company's website at alkres.com. Today's press release, the financial statements and the MD&A are all posted on our website and SEDAR+. For those on the webcast, please move through the presentation slides yourself as directed by our presenters.

Moving on to Slide 2. I'll remind everyone that this conference call contains forward-looking information that is based on the company's current expectations, estimates and beliefs and may also use terms that are non-IFRS performance measures. Please review Alkane's quarter 3 fiscal year 2026 disclosure materials for the risks associated with this forward-looking information and the use of non-IFRS performance measures.

Please note that all dollar amounts mentioned on today's call are in Australian dollars, unless otherwise stated. Also, as management reviews the results, please remember that Alkane has a June 30 fiscal year-end. So the quarter ending March 31, 2026, is the third quarter of our 2026 fiscal year. And as we closed the merger with Mandalay Resources on August 5, 2025, our group financial and operating results for quarter 3 2026 shown today only include 8 months from the Costerfield and Bjorkdal mines, the former Mandalay operations and a complete 9 months of results from Tomingley.

Please move on to Slide 3. Today's speakers from Alkane Resources are Nicolas Earner, Managing Director and Chief Executive Officer; and James Carter, Chief Financial Officer. I will now hand the call over to Nick Earner. Please go ahead, Nick.

Thanks, everyone, for joining us today. Let's jump right into Slide 4, which tells a pretty clear story. We've just delivered another record-breaking quarter across the board, and this is both operationally and financially. All 3 of our mines are operating really well. On a consolidated basis, we produced a record 45,800 gold equivalent ounces in the quarter, is about 5% higher than in quarter 2.

For the first 9 months of our fiscal year, we produced 120,000 gold equivalent ounces. This is well on our way to meeting our full year guidance of 155,000 to 168,000 gold equivalent ounces, remembering, as Nat said, that this doesn't include July's production from Costerfield and Bjorkdal.

Given the strong prices for gold and antimony and our robust production results, our mines generated AUD 189 million in operating cash flow in the quarter. This is a bit over 40% higher than in quarter 2. At quarter end, we had AUD 374 million in cash, bullion and liquid investments on hand. We continue to build our financial position clearly to aggressively grow the company through both exploration and capital at each of our mines and advance the Boda-Kaiser copper-gold Porphyry project. And as I've discussed previously, we're simultaneously seeking M&A to opportunistically grow the company.

Another accomplishment I'd like to point out, which we're pretty proud of, which occurred subsequent to quarter end, Alkane was included in the S&P ASX 200 Index on April 22. We expect this to, in time, result in a further increase in stock liquidity and potentially reduce volatility as a greater number of investment funds can now own Alkane in their respective portfolios.

Now let me move on to Slide 5. On a consolidated basis in Q3, Alkane mined more than 620,000 ounces of ore at an average gold grade of 2.33 grams per tonne and an average antimony grade of 1.12%. Recoveries of 91.4% gold and 85.9% antimony remained fairly consistent quarter-over-quarter. As a result, our mines produced nearly 46,000 gold equivalent ounces, consisting of nearly 45,000 ounces of gold and 377 tonnes of antimony, which again is a record for the company.

I'll get into specifics on each mine shortly. Needless to say, all of our mines are operating well, and we remain on track to meet fiscal 2026 guidance.

Moving on to Slide 6 at Tomingley. In quarter 3, we produced 315,000 tonnes of ore, which is just a touch less, 1% less than quarter 2 and an average recovery rate of 90.1% with an average grade of 2.4 grams per tonne of gold.

This result in production of 21,652 ounces of gold, which is a touch lower than in Q2. Processing continues to perform well and milling is exceeding plan. Now this is primarily as a result of an insertion of a mobile crusher to pre-crush material prior to entering the processing circuit. This pre-crushing material, which is we've tried different sizes prior to entering the circuit continues, and it's seen an increase in milling rates to about 1.3 million tonnes per annum.

Further optimization to balance our throughput and the cost that occurs in this mobile crusher continues. The primary source of ore continues to be from the Roswell deposit. Underground ore was slightly below what we would have liked, primarily due to stope performance issues on several stopes that required rework, but this was offset slightly by higher development ore tonnages.

Capital expenditure during the quarter was allocated primarily for our Newell Highway realignment project. Construction of this is expected to complete in Q2 fiscal 2027, so the end of this calendar year 2026. By accessing the high-grade San Antonio deposits by 2 new open cuts, this high-return project will accelerate Tomingley's growth and further optimize our cost profile.

All-in sustaining costs at Tomingley in quarter 3 were AUD 2,444 per ounce, about 10% higher than we had in Q2. The higher costs were a result of higher processing costs, which includes the cost of the rental crusher, which, as I said before, this is a high-return initiative that's continued into Q4 and expected to continue going forward. Overall, Tomingley generated AUD 54 million in the third quarter.

Moving on to Slide 7. At Costerfield, our gold-antimony mine, we processed 36,000 tonnes of ore. In Q3, gold grades were 10.2 grams per tonne, in line with Q2 and antimony grades 1.2%, which is about 1/3 higher than in Q2. Gold and antimony recovery rates were 93.6% and 85.9%, respectively, matching the previous quarter.

The mine produced 10,584 ounces of gold, which is similar to Q2 and 377 tonnes of antimony, which is 41% more than Q2. Now I want to stress that antimony grades can be variable throughout the mine and were higher than typically we're seeing in the ore body areas that we're in, in Q3. Overall, we remain in our mining plan and our mining guidance for Costerfield.

Costerfield delivered steady-state operational performance during the quarter, with all mining and milling rates exceeded our planned rates. We've had strong mining performance in terms of tonnes mined for the quarter and our extraction from different areas complied reasonably well with forecast mining advance in each area per month. We do, of course, continue to work on our continuous improvement programs. For us at Costerfield, this is a bit of drill and blast optimization, capital development optimization.

We continue to work on operator training and our transition to emulsion explosives to improve recovery and reduce dilution continues. Processing, we focus on blending control to maximize throughput, recoveries and produce metal. We also here had successful trials during the quarter with respect to pre-crushing ore feed as well and screening lower-grade ore stockpiles to further improve throughput, crusher downtime and blend control.

Work continues here to prioritize that operational efficiency. All-in sustaining costs at Costerfield in Q3 were AUD 2,521 per ounce. This is 17% higher than Q2. This is primarily a result of a one-off AUD 4 million inventory adjustment of the run-of-mine stockpile following the introduction of a new inventory model to match that used at Tomingley.

As a result of all of this, Costerfield generated a record AUD 80 million in cash flow. This is a significant increase compared to the AUD 30 million we had in Q2.

Moving on to Slide 8. In Q3 at Bjorkdal, we processed more than 320,000 tonnes of ore at an average grade of 1.5 grams per tonne and an average recovery rate of 90.4%. Building on this consistent operation, Bjorkdal produced 12,433 ounces of gold, which is up nearly 25% compared to the previous quarter.

In general, we allocated resources to capital development activities in preference to operating development. Mine grade was in line with planned grades, and we had a slightly higher contribution from below the marble mining area, which traditionally has been a slightly high-grade area for us rather than above the Marble unit. Mill throughput decreased slightly, while recoveries improved compared to the previous quarter, albeit not really much more than we would expect in line with increased head grade.

Also during this quarter, of interest, we did a trial of processing a parcel of off-site ore from a small mine to the west of Bjorkdal, and this was pretty successful. The goal with this program is to evaluate the option and possibility of sourcing off-site ore to increase production and lower cost at Bjorkdal. Through this trial, we've got an understanding, hey, this ore, it works. It's successfully into the plant, fed into the plant. It's got great recoveries. And so further studies of this negotiations, what permitting things needed are underway to understand how we can continue this program.

During the quarter, there was continued underground capital development success. We achieved more than 1,100 meters. This is in line with the previous quarter. We got 1,200 meters, and we're above plans both for the quarter and year-to-date.

Also, capital works on a series of lifts to the tailings dam facility have commenced. We started this once the area there thawed post winter. And additionally, the development of the [ Newlands ] open pit, a small open pit right next to the long-term Bjorkdal pit that closed many years ago and an upgrade of the equipment fleet has also continued in quarter 3.

So the higher production allowed all-in sustaining costs in Q3 to be AUD 3,699 per ounce, about 10% lower than in Q2. With this improved production, operating cash flow from Bjorkdal was AUD 55 million or over 50% more than the second quarter.

One of our key things is to drive organic growth by increased mineral resources, and I'm going to talk you through the exploration program across our portfolio. So let me start by moving on to Slide 9, Tomingley.

At Tomingley, one of the interesting things that we did in the quarter was testing a seismic reflector feature quite deep beneath the Roswell deposit, which is bullet point #4 on your map there and near-mine prospects such as El Paso, which is bullet point #5. Now at Roswell, this deep drilling intersected gold arsenic-enriched hydrothermal breccias and veining right where we expected it in the seismic reflector. This is 400 meters below the current resources.

So we've got a fair bit of further drilling plan to test where this structure intersects both the andesite and Monzodiorite units. Both of these are favorable host at Roswell and both of them extend down at depth.

So a pretty interesting area for us to see whether this is an area that has fluids that feeds gold up on into Roswell. At Roswell -- I mean, sorry, at El Paso, we had 8 drill holes completed, and this resulted in us reinterpreting the geological model, allowing us to better understand the geological structure of El Paso, which we don't really fully understand.

A drilling program to test the new model is planned. Meanwhile, underground drilling at Roswell itself in the quarter focused on improving confidence in the inferred resource. We got some great results like 5.9 meters at 31 grams per tonne of gold, which includes 2.1 meters at 78.4 grams per tonne of gold, got a different one of 17.4 meters grading 4.3 grams per tonne, which includes 2.5 at 21.1. These are all very typical of what we see at Roswell. Additional underground drilling has commenced to keep and accelerate this infill drilling program.

So moving on to Slide 10 at Costerfield. We invested just under AUD 7 million or AUD 6.6 million in Q3 to work to expand the resources. As you can see in points 1 and 2 on the map on the slide, True Blue drilling continued. We were well advanced this in Q2, and we included step-out testing of surface geochemical anomalies.

Targets around the existing workings, which these targets will be incorporated -- our results will be incorporated in the plan in the coming years into FY '27, including Kendall, bullet point 3; Brunswick South, bullet point 4 on the slide. At Kendall, 25 individual veins have now been identified and modeled. These are immediately above the currently mined Youle and Shepherd ore bodies, and these surround the historically mined from many decades ago Costerfield deposit.

So we looked at extension drilling in that area, and this gave us pretty strong results, including amazing results like 1.94 meters grading, 132 grams per tonne of gold, so over 4 ounces of gold per tonne and 19.8% antimony, very high-grade antimony and 2.3 meters grading 267.5 grams per tonne over 8 ounces per tonne of gold and 5.6% antimony.

These are clearly ultra-high grade and they're similar to mineralization at the nearby Fosterville mine, and these present one of our most exciting prospects. I would not want you to think that I'm saying that we have a massive tonnage here, but they're certainly very, very high grade.

At Brunswick, we conducted infill and extension drilling programs with additional drill rigs mobilized to accelerate that program. And up at bullet point 6, you can see on the screen, we're also testing for potential the Sunday Creek, the Southern Cross style mineralization just below Costerfield's historic mines.

So let's move on to Slide 7 (sic) [ Slide 11 ] . At Bjorkdal, drilling expenditures were just under AUD 3 million during the quarter as 3 exploration targets were progressed. Drilling at North Zone, that's bullet point 1. This moved from growing to infill, while the Eastern extension program targeted the continued depth and the eastward extension of the main and central zones. This is bullet point 2.

And further to the Northeast, most interestingly, at Storheden, this growth drilling also continued as did to the East at Norrberget during the quarter. At Bjorkdal, we continue to explore for narrow high-grade veins, which we've shown that we can mine these efficiently.

Let's move to Slide 12. The Northern Molong Porphyry project, the entirety of which is shown on the map on this slide, is a highly prospective gold corridor. This project also encompasses our Boda-Kaiser Copper-Gold project, which is in the bottom right of the picture that you're looking at. Exploration on this project for the quarter included our continued inversion and interpretation of the Mobile Magneto-Telluric or MMT survey data that was flown in November.

Across this drilling for a total of 4,000 meters that commenced through December was completed, and we're interpreting this, and we expect to report them in the coming months. Now other low-cost activities to advance the development of Boda-Kaiser gold-copper project in the quarter included the continuation of our environmental baseline studies. We did stakeholder consultations, property negotiation, site selection and infrastructure. These are low-cost but high-impact activities.

So we think that this keeps us well on the path towards a project approval application in late 2027, calendar '27 or early 2028. We have here the goal of receiving approval to then go on and make an investment decision in late 2029.

So as you can see, there's a tremendous amount of exploration work going on at each of our projects, all with the goal of expanding resources and driving for new discoveries to increase the mine life, therefore, increase production levels and contain and potentially lower the costs.

And with that, I'll now hand the call over to you, Jim, to provide a review of our financial performance.

Thanks, Nick, and hello, everyone, who's joined us on the call wherever you are today.

So on Slide 13. So I'm going to start with an overview of the key financial highlights for our third quarter of our financial year 2026. And so I'll be focusing on really just this financial year as the results of the previous year don't include the former Mandalay operations.

So group revenue for the quarter, that was a record just over $274 million on sales of about 42,500 ounces of gold and 280 tonnes of antimony at average realized gold price of just over AUD 6,300 per ounce and an average antimony price of about AUD 34,400 per tonne.

During the quarter, we also delivered about 8,700 ounces of into our gold hedge book. That's at an average price of just around AUD 2,855 per ounce. And we've got about 5 quarters remaining of hedge deliveries through to June 2027, which is just a very small percentage of our overall forecast production and revenue.

All-in sustaining costs on a consolidated basis were just over AUD 2,900 per ounce on a gold equivalent produced basis, a little bit higher than Q2. A little bit of impact there from the impact that we're seeing across the industry with diesel fuel, not so much of an issue for us as Alkane, plus just a little bit of more planned sustaining capital around underground capital development and some equipment purchases, which is sort of what we are forecasting to do.

EBITDA in the March quarter, that was a record AUD 161 million, higher than the quarter previously. And for the 9 months -- for the 9 months so far this year, we've generated AUD 334 million of EBITDA, and that's an EBITDA margin of just under 50%. Net profit after tax for the March quarter, another record $93 million after tax, $0.0681 per share. And on a year-to-date basis, our net profit after tax is just under AUD 158 million or $0.1244 per share.

Sustaining capital during the quarter, $24 million, largest programs, around $7 million for underground capital development at Bjorkdal, $9 million for ongoing equipment replacements at Tomingley and Bjorkdal as well. Just reminding everyone that across our 3 operations, we are -- we do own and operate all our own equipment because that works for us best efficiently and economically.

Growth capital was $10 million for the quarter, and most of that's invested at our Tomingley operation in our new highway realignment, which is for the eventual mining of the San Antonio open pit in 2027. And exploration across the group in the quarter was $13 million, and Nick sort of spoke about that across our operations and our Boda-Kaiser project.

So I'll turn to Slide 14 now, and we've got the cash waterfall here. So in the third quarter, cash flow from our 3 operations was a record $189 million, 42% higher than the second quarter. Corporate and other expenses sort of in that bucket of $20 million of cash outflows. We've got corporate and technical support costs, that includes about $3 million on our Boda project and some other regional exploration, $6 million for the Lupin project in Canada that we're rehabilitating and closing down, $5 million for a net repayment of equipment lease finance.

And we also received $4 million during the quarter from a noncore divestment of the La Quebrada project in Chile. So after sustaining capital expenditures, growth, exploration, taxes, corporate, we ended the quarter with $328 million of cash. So net about $110 million cash growth over that quarter. So at the end of the quarter, we've got a really strong, robust financial position. We have access to up to $520 million of liquidity through the cash bullion listed investments. And we also finalized a new $110 million revolving credit facility and $40 million contingent instrument facility during the quarter.

So yes, records around, a very strong quarter financially. And yes, on the back across the industry having a very good strong gold price environment. But I think it's important for us to highlight that, yes, we all have that benefit and those tailwinds. But on the ASX, when we compare, we have industry-leading margins during the March quarter as well. I think maybe on a clear cash generation per ounce sold during the quarter, I think maybe second place out of all the industry producers.

So more than just a strong gold price, but we're priding ourselves on taking advantage of that through strong efficient operations, trying to keep an eye on costs as well. So that gives us in a great position to help internally fund our own organic growth projects and really position ourselves for anything that might happen opportunistically as well. And I think at that stage, I'll turn the call back to you, Nick.

Great. Thanks, Jim. Let's move on to Slide 15. Let me focus on our outlook. We want to build on this momentum that we've achieved to date throughout fiscal '26. Leveraging the financial strength that Jim just outlined, we're well positioned to deliver on our dual-track strategy, growing production whilst containing costs to maintain overall margins and to increase our cash-generating capabilities.

We're pretty firmly on track to achieve the top end of our annual production guidance of 155,000 to 168,000 gold equivalent ounces. Now it's worth noting again -- sorry, this will end next financial year, but the true scale of our operational footprint had we included all of the Bjorkdal and Costerfield production for July '25 then the full year guidance would climb to the 160,000 to 175,000 gold equivalent ounces, which firmly establishes Alkane as a mid-tier gold producer.

On the cost front, we retain discipline. Our consolidated all-in sustaining cost is on track to hit guidance at AUD 2,600 to AUD 2,900 per ounce or between, if you talking U.S. dollars $1,690 to $1,885 per ounce, albeit we do expect to be at the top end of that guidance. But we do have a pretty aggressive commitment to organic growth. We're deploying in the vicinity of $80 million in growth capital and exploration to keep unlocking value at our sites.

Our primary goal for FY '26 was to establish Alkane Resources as a reliable, consistent producer. And I think our performance to date shows that we've done exactly that. Moving on to Slide 16. We remain focused on execution. And as the numbers show, I hope you all think that we're delivering on that promise. We're positioned to meet our targets, both in production and cost. We're deploying the drill bit across our entire portfolio to expand our resource base. This is what we want to do, the bedrock of our strategy. We want to extend our mine life. We want to accelerate production growth at all 3 mines. And of course, we have Boda-Kaiser. This is a very serious copper-gold porphyry project, remains an important part of our portfolio, and we think it's a key for long-term value creation for all of our shareholders.

We're moving purposefully on the environmental studies and permitting to advance the project. And in doing so, we give ourselves maximum flexibility to unlock value. Corporately, I think at this time now of the market, our balance sheet is a clear strategic advantage. Given our steady-state operation in this pretty robust still gold and antimony price environment, we expect to continue to build our cash position. This allows us to grow from within as well as inorganic growth opportunities. While we're pretty well positioned to move quickly, of course, we will maintain discipline. In closing, we think we're well positioned to drive long-term value for our shareholders and our stakeholders. And thanks, everyone. With that, I'll hand back to the operator to start the Q&A session. Thank you, operator.

[Operator Instructions]

We are now going to proceed with our first question and the questions come from the line of Lawrence, a retail investor.

Good evening in Australia. I'd like to thank the Alkane team for staying up late on a Friday evening. I have several questions, Nick, and I'll start with the first one. When will Alkane disclose the exploration and mining plan for the Nagambie earn-ins?

Yes. Lawrence, thank you very much, mate. No problem staying up, but thank you for acknowledging.

So Nagambie, at the moment, we're compiling exactly what we're looking to do. However, we've already obtained a drill rig. We're mobilizing that to site. We expect to start drilling in the next couple of weeks. But the first drilling we're looking to do is simply to put sort of 3, 4 holes into the existing inferred resource that Nagambie has in order just to firm it up, redo the model and then start to do targeting.

So once we've done that, then we can detail -- a more detailed program. But I would say, probably in reality about 2, 3 months.

Okay. That's great. On the Nagambie presentation, I think it's dated 2023, they mentioned Whroo and Redcastle JVs for some of the Nagambie permits that are off, I think, kind of northwest and north of the mine. Are those JVs still in progress?

So as far as I'm aware, and forgive me, I may be a tiny bit inaccurate. But as far as I'm aware, no, the only remaining agreement is with a company called Golden Camel, who has the right to process material. I'm going to call it the Northeast corner of the mine, a very long-standing relationship there. They, of course, need to attract funding and all the other stuff to do that. So at this stage, though, most of the work that we're doing will be on that primary tenement package in and around the old mines under the old open cut.

So if I've stuff that up, I apologize, mate, but our primary target is in and around that existing mining area.

Okay. I'm still trying to figure out the Boda-Kaiser project. I'm trying to understand what the profitability is because it seems to look like a Kinross project where you have high tonnage, low grade.

Mate, you're absolutely spot on about that. So if we rewind a fair bit to the scoping study that we put out in July 2024. So we looked at a 5 million tonne a 10 million tonne and a 20 million tonne per annum scenario, way back when gold price was AUD 3,500 per ounce, right? And copper was under what it is in today. So gold price now is in Aussie dollars, I'm going to say, AUD 6,400, so another AUD 3,000 per ounce. And copper has gone from being around this AUD 15,000 per tonne to nearly AUD 20,000 per tonne.

But you are correct. It is a large, very large, lower-grade deposit, which contains gold and copper in nearly 50-50 value. The overall grade is 0.58 grams per tonne equivalent. That changes, of course, on gold price, but it's comprised of 0.3 grams per tonne of gold, 0.18% copper. So a couple of key things around value.

Back then, the IRR was solid, but not amazing. At current prices, if we did 20 million tonnes per annum, the IRR on a pretax basis is up over 50%. So a couple of things that will have changed, of course, since that study. Capital costs will have risen slightly. So we'll redo that as we work through this next year or 2. OpEx will no doubt have been influenced. We're all waiting to see where everything ends up over the next year or 2. But it's fair to say that prices have moved way more as a percentage, gold and copper prices in those terms.

So if you look at the 20 million tonne per annum scenario, it averaged over a 17-year life of mine, it would average equivalent of being a bit over 200,000 to 220,000 ounce equivalent operation. If you did a 10 million tonne per annum, it was a tiny bit higher. It was sort of in the 110 to 125 -- so anyway, what you're seeing is in this price environment, it's a very profitable operation, but you're exactly correct. It needs big tonnes. The bigger the tonnes, the better it is. It will start open cut. It will transition to underground in 10 to 30 years depending on what size processing plant is. Look, I will certainly call our executives and check out that scoping study.

Do you think ore sorting could be used at the Boda-Kaiser process?

Sorry, it's not -- I mean, ore sorting at some of our other prospects, yes, but not this one. It's a really large calc-alkalic porphyry. So no, I don't see we would get an uplift from ore sorting.

Yes. Okay. I think my next question is, I assume that you've heard about the Trump administration's project Vault.

Yes, but I am not an expert, I will be incorrect.

Yes. So I was wondering if Alkane has had any discussions with the Trump adminfstration with regards to selling antimony into Project Vault.

We've had, as many people have, because they've been very thorough around the world. We've had some communication around the selling of concentrate once they establish that downstream smelting, yes, but there's nothing committed at all.

Okay. Well, at least you're having discussions. That's a good news from my point of view. I'm not sure where they are in developing Project Vault. Obviously, they're going to have some strategic warehousing set up across their country. And I don't know if they're at that stage yet.

Thanks for your questions, Lawrence.

Just actually, just one other question. Does the Communication Officer or Investor Relations Officer have a phone number?

Yes. So if you look on the bottom of any of our announcements on our website, you will see Natalie's contact details there.

Yes. And I guess the only other piece of feedback I have, and this has to do with my neurological PTSD situation is that today's -- could today's presentation be put in the investor presentations web page just to make it easier to find because I couldn't find the presentation that you were using on the call today. So I'm wondering if it could be put into the presentation section prior to having the investor call.

Thank you for the feedback, mate. It is something we will check out.

We are now going to proceed with our next question. And the questions come from the line of Kevin Tracey from Oberon Asset Management.

The first one is on Kendall, pretty exciting exploration results there we announced in February. Can you -- and you mentioned that Kendall is quite close to your existing infrastructure. Can you talk about the timing of when you could mine material volumes from Kendall and how the results change your outlook for the mining plan?

Yes, certainly, Kevin. We expect that we'll be mining Kendall over the next 12 months, later in the next 12 months. So the nature of Costerfield as a mine is that we seek to at least replenish the reserves each year. And also, if possible, obviously, we want to expand the reserve for it. The high-grade areas of Kendall we'll be developing up towards and also Brunswick South is a new mining area that we'll be developing towards. So I don't see that significantly changing the outlook from sort of this year's production. But certainly, it will be good to get up there and then start to check it out with some development drives.

Okay. And then at Bjorkdal, the production number was the best we've seen in a long time. And my question really is about the gap between the process grade and the mine grade. Or historically, we've seen the process grade be lower than the mine grade as you supplemented underground ore with stockpile. And in the most recent quarter, the process grade was a good deal higher. Is this totally explained by the kind of off-site trial of processing of third-party ore that you talked about? Or it will be explained by something else?

Yes, pretty much, Matt. Yes. So the mine that we looked at, obviously, because we're tracking it, had a head grade of, I'll just say, 6 grams per tonne . so you can understand why we're looking to see if that works for us, and there's a whole host of different aspects of that. So yes, that is the main explanation of what to do. We are looking at ore sorting, but no, it's not that. It is all the off-site production.

Okay. And are you hopeful that you'll be able to sustain the processing of that ore? Or yes, do you see grade as sustainable in the quarters ahead?

Yes, totally. So no, do not put into any model that you might have yet. We are hopeful that we can secure some sort of arrangement from that mine or others. But there's a couple of hurdles to overcome; one, negotiating with those parties. But two, also the permitting, part of the trial was to get tailing samples and other things to make sure that we would be compliant with any of the environmental conditions we have on site, and then we have to test that with the regulator over the coming months to get permission to bring in ore such as this from offsite.

So yes, we very much want to pursue it. Yes, we very much want to do deals, and yes, we'll be pursuing with the regulator. But it's more months than years, but it is still something we need to land.

Okay. Great. And then bigger picture at Bjorkdal, you have a broader strategy of opening more mining fronts and filling the mill with more underground ore. Can you just update us on the status of those efforts and kind of give us a preview of what we should expect in fiscal '27 in terms of volumes at Bjorkdal underground?

Yes. So we absolutely do have a strategy. So there's 2-part strategy. So number one is the pit at [ Newlands ] which is just a tiny bit to the east of where the Bjorkdal open cut was. That's a mine open cut that we've been doing pre-stripping of at present. It's got a stripping ratio sort of the order of 6 or 7:1. And we expect to be delivering ore from that at around sort of this 0.8, 0.9 grams per tonne, which is higher than the low-grade stockpiles later this calendar year, so during the next financial year. So that's sort of part 1.

Part 2 is the Storheden deposit to the north of the existing mine. We have a mining lease there, but we need to get the environmental permit to mine that. We have [ commenced ] already the development towards that. So that needs a new cross cut going across from underground and then a decline. That's probably the better part of 3 years activity and an update of the environmental permit. So these are the 2 things we're doing.

So next year, I expect our production will be similar-ish to this year. I expect our capital costs will rise because we're looking to invest in those 2 things that I described, but they all will be setting us up for increasing production going forward, ideally the year after and the year after that.

There are no further questions on the phone line. So I'll now hand over to Natalie Chapman for the written questions.

Thanks very much. So we'll start off with what opportunities does Alkane see in gold and antimony beyond Costerfield?

Okay. So -- and outside of our own exploration things that I just described, clearly, for us, there's the joint venture with Nagambie in our immediate vicinity. There are some other companies that have gold and antimony deposits more regionally, so we'll call it within 150-kilometer radius. But we're only in the very early. Let's just have a look at these and consider it at this stage. Please don't read too much into that. Looking more broadly internationally, I'm sure many of you that know the antimony market will be aware of other projects.

At the moment, at the very most, we have a desktop review of some of those. So we're not actively pursuing in our M&A in antimony lead on anything. We are looking at gold projects and some of them do include antimony, but not really. I hope that answers your question. If it doesn't, please type in another one.

Are you still conducting a geophysical exploration?

Absolutely. So we've broadly finished our geophysics at Boda-Kaiser because we've updated those with updated gravity, magnetic and other things for targeting. Down at Costerfield, we are almost finished updating our information density there. And we have a structural expert looking at that to assist with our targeting to extend the mine life. At Tomingley, it's similar. We've done further survey work there, geophysics. Most of that's finished. We're now engaging structurally. And we're looking at that deep drilling, I said to test some of the seismic work that we've done there. So I hope I've answered your question.

When will Alkane pay its first dividend?

Well, it's something we talk about in the Board all the time, particularly as we have such strong cash flow generation. We're looking to put together a capital management strategy, buybacks, dividends, et cetera. And we expect to announce that in the second half of this calendar year and the first half of next financial year, so we will have a pretty clear idea of the ratio, liquidities and what we intend to do with cash.

At the moment, our key thing is to really look at our M&A opportunities and run those to ground. But we're putting out a capital management policy for the end of this year. But I won't -- we do not expect at this stage, even though we talk about it each month, we meet with the Board, we're not anticipating paying a dividend at the end of this financial year. So that may occur, but people should not count on that.

How much, if any, of the drop in the all-in sustaining cost at Bjorkdal this quarter was down to the trial sample? And would you expect further cost declines there if the outside ore is brought in on a continual basis?

Yes, absolutely. So the costs at Bjorkdal are pretty much fixed. They're close to 65%, 70% fixed. So it was definitely the per ounce cost base was absolutely influenced by that offside ore, which is, of course, why we're looking at that and other sources for it. In the event that we do find and follow up the questions I gave, Kevin, around that offside ore, then yes, I would expect the all-in sustaining cost to come down. That's the whole premise of all the different activities we're trying to do Bjorkdal.

Congratulations on a strong quarter and the smooth integration. I appreciate you maintaining a strong balance sheet and the investments in exploration and optimization. With 20% of market cap in net cash and it is building quicker and can be spent. Any thought on maintaining 20% of net cash bullion if successful finding -- if you're successful finding an external opportunity, but allocating a portion of incremental free cash flow to opportunistic buybacks at this level of undervaluation?

Yes. So the capital management strategy will no doubt incorporate something such as the questionnaire is envisaging. However, we're also very much looking at dividends given we have Australian franking credits as well.

What impact does the rising cost of oil have on your operations, particularly those in Australia?

Man, yes, obviously, topic for all of this. So to date, given that we are grid powered at all 3 mine sites and we're underground, not operations, so lower tonnage movement. The oil price itself, the diesel fuel has not had that much of an impact.

It's fair to say I'm pretty concerned about all the flow on things. So things like drill bits with the tungsten as a portion is the cost of those are rising, the cost of poly pipe is rising, the cost of some reagents is rising. And I do have some sympathy for our suppliers as it rises and falls. And when we ask them, okay, we're preparing our budgets for next year, what is this going to be. But to be honest, people can't really tell us that much, right?

So directly related to oil, not much; as to where it all settles on the broader, I don't know, I'll just call it, supply base of reagents, explosives, drill steels and other things that transport affected. I really can't say. Today, we haven't seen that flow through. But to be honest, it does feel like it's going to be inevitable and certainly, all the external commentary I read makes me think that as well.

Thanks, Nick. We have no further questions. So I'll hand back to you for closing comments.

Okay. Great. Great. Thanks, Nat. Look, thanks, everyone, for taking the time to join us today. And look, while we've had a successful financial year so far, we, of course, look forward to showing more of our progress in the next call in a few months. As always, please reach out if you have any questions. And as I said to Lawrence in our first question, Natalie's details are on the bottom of all of our announcements. So thank you, and good evening to everyone here in Australia, and have a good day, everyone, in Canada. Thank you.

This concludes today's conference call. Thank you all for participating. You may now disconnect your lines. Thank you.

Thank you for standing by. This is the conference operator. Welcome to the Alkane Resources Second Quarter Fiscal Year 2026 Financial and Operating Results Conference Call and Webcast. [Operator Instructions] The conference is being recorded. [Operator Instructions]

Now let me hand the call over to Natalie Chapman, Alkane's Corporate Communications Manager.

Hello, everyone. Thank you for joining our call today. Some housekeeping items to note. The accompanying presentation for today's call is available for download from the company's website at alkres.com.

Today's press release, the financial statements and the MD&A are all posted on our website and SEDAR+. For those of you on the webcast, please move through the presentation slides yourself as directed by our presenters. Moving on to Slide 2. I'll remind everyone that this conference call contains forward-looking information that is based on the company's current expectations, estimates and beliefs and may also use terms that are non-IFRS performance measures. Please review Alkane's quarter 2 fiscal year 2026 disclosure materials for the risks associated with this forward-looking information and the use of non-IFRS performance measures.

Please note that all dollar amounts mentioned on today's call are in Australian dollars, unless otherwise stated. Also, as management reviews the quarter and half yearly results, please remember that Alkane has a June 30 fiscal year-end. So the quarter ending December 31, 2025, is our second quarter of the 2026 fiscal year. And as we closed the merger with Mandalay Resources on August 5, 2025, our group financial and operating first half fiscal 2026 results shown today only include 5 months from the Costerfield and Bjorkdal mines, the former Mandalay operations and a complete 6 months of results from Tomingley.

Please move on to Slide 3. Today's speakers from Alkane Resources are Nic Earner, Managing Director and Chief Executive Officer; and James Carter, Chief Financial Officer.

I'll now hand the call over to Nic Earner.

Hi, everyone, and thanks for joining us today. Let's go to Slide 4, which provides a quick summary highlighting our record achievements on our very successful first half of 2026. Alkane had a record-setting second quarter and first half of fiscal 2026, both operationally and financially. We produced just over 43,600 gold equivalent ounces in Q2, which gives us just over 74,000 gold equivalent ounces for the first half of 2026. And remember here, the ex Mandalay asset production from July, the month of July is not included in that number. And so when we look at our full year, so the full 12 months, including July, including Mandalay assets, we're on track to meet that group 2026 guidance of 160,000 to 175,000 gold equivalent ounces. So given the strong prices for gold, the strong prices for Antimony and our great production results, our mines generated AUD 133 million of operating cash flow for the quarter, which has boosted our already strong financial position.

As of quarter end, we had AUD 246 million in cash, bullion and liquid investments on hand. This strong financial position, combined with what we expect to be continued robust free cash flow from our operations, allows Alkane to aggressively grow the company through exploration, capital programs at each of our mines as well as advance the Boda-Kaiser copper-gold porphyry project and opportunistically grow the company inorganically. Now let me move on to Slide 5 to get into more details on the quarter. On a consolidated basis, in Q2, Alkane produced nearly 43,000 ounces of gold and 267 tonnes of Antimony, which equates to nearly 44,000 gold equivalent ounces.

All of these are records for Alkane as a company. This was from mining nearly 581,000 tonnes of ore at an average gold grade of just under 2.4 grams per tonne and an average Antimony grade of just under 1%. Recoveries of just over 90% gold and just under 87% Antimony were higher than in Q1. Now I'm going to get into specifics with each mine shortly, but let me summarize, overall, all our mines are operating well and all of them meet our own expectations, which are very high.

So let's move on to Slide 6 and look at Ting. In Q2, we processed nearly 319,000 tonnes of ore at an average recovery rate of 89.8% and an average grade of 2.5 grams per tonne. This led the mine to produce a bit over 22,000 ounces of gold. This is 20% higher than we got in Q1.

High production came from slightly improved operations, but mostly from the planned mining sequence moving into higher-grade zones, also continued cost management. And this resulted in all-in sustaining costs in Q2 being AUD 2,216 per ounce. The U.S. dollar amount is on the screen there. This is 16% lower than in Q1. So the primary source of ore at Tomingley continues to be from the Roswell underground deposit. During the quarter, and I'm going to describe this is ordinary course of business for us, but I want to give you detail on this. We had some minor challenges. We had some shock credit downtime that delayed our paste fill. We had some lower development rates leading to lower development ore. And we redesigned some stope shapes to improve load recovery.

But all these issues were overcome pretty rapidly and like I said, a part of the ordinary course of business. Our processing plant continues to perform well. We're milling in excess of budget. And primarily, this is a result of us inserting a mobile crusher to pre-crushed material prior to entering our processing circuit. So this pre-crushing material entering the circuit has seen a nominal increase in milling rates to approximately 1.3 million tonnes per annum with further optimization on both throughput and cost options for this mobile crusher continuing. Capital expenditure during the quarter was mainly for the Newell Highway realignment project.

Construction of this is expected to be completed in about a year from now in 2027. This is a high-return project, which allows us to access the high-grade San Antonio deposits in 2 new open cut mines. Bottom line, improved productivity, lower costs, higher gold grade, higher gold prices. Cash flow from Tomingley was AUD 67 million in the second quarter or a bit over 70% higher than Q1.

Moving on to Slide 7. Q2 at Bjorkdal, we processed nearly 330,000 tonnes of ore with an average grade of 1.04 grams per tonne and an average recovery rate of 87.4%. This allowed us to produce just under 10,000 ounces of gold. All-in sustaining costs in Q2 were AUD 4,117 per ounce. Again, the U.S. is on the screen or 2% higher than in Q1. Bjorkdal was a solid quarter mining performance.

All production is going well. We've got consistent stope productivity, and we've got stable development activities. We've also started replacing some critical equipment, which has resulted, as you'd hope, in machine availability. Further equipment replacements are continuing in this quarter, current quarter 3. Mill throughput was a little bit slower -- I mean, lower than the previous quarter.

This is primarily due to our mill reline, the new linings we put in were wearing slightly slower than the anticipated rate, good for relining, but it limited our maximum allowable mill load. The completion and commissioning of the return water system from the mine as well has also had a positive impact on flow performance to date, which has led to improved recoveries. With the improved productivity and higher gold prices, operating cash flow from Bjorkdal was AUD 35 million for the second quarter.

On to Slide 8. At Costerfield, our gold and Antimony mine, we processed nearly 35,000 tonnes of ore. In Q2, we plan to be in a higher grade sequence in the mine. Therefore, we achieved an average gold grade of just under 10.4 grams per tonne and an average Antimony grade of 0.91%. Both of these were higher than in Q1. Gold recovery rates of 93.9% and an Antimony recovery rate of 86.8% were also higher in Q1. Our increased plant efficiency and throughput rates, particularly as well as the grade, allowed the mine to produce 10,790 ounces of gold and 267 tonnes of Antimony or 11,686 gold equivalent ounces. All-in sustaining costs in Q2 were AUD 2,149 per gold equivalent ounce, resulting in a 12% decrease from Q1.

And this demonstrates the focus we have on getting high grade in and expanding our production rates. Costerfield summary, steady operational performance during the quarter, strong mining productivity as well, we continue to advance several initiatives to improve our ore quality and recovery. We continue to try and optimize drill and blast optimization, remembering this is a narrow vein stoping environment where we're trying to keep our widths as tight as possible. We continue to focus on operator training, and we are moving towards emulsion explosives because we want to improve some recovery and reduce dilution.

So as we prioritize here on Costerfield, operational consistency and grade control, and we use this to underpin our strong production outcomes that we expect to get over the coming quarters. So with this great productivity, with our cost control, high gold prices and, of course, higher gold grade, operating cash flow from Costerfield was AUD 30 million for the second quarter.

Now moving on to Slide 9. One of the key strategic initiatives that we have is to drive organic growth by increasing mineral resources, we have an aggressive exploration program across our portfolio. I'm going to tell you about that now.

So on Slide 9 here that we're at. At Tomingley in Q2, we invested AUD 2 million for the quarter in several programs. This includes 1 and 2 on the picture, extension drilling under the existing pits of Wyoming and then Caloma North. #4 on the picture, resource infill drilling at Roswell, and we get results here like just under 8 meters at nearly 0.5 ounce per tonne. At #3, discovery of a new zone of gold-rich mineralization at McLeans right next to existing infrastructure, intercepting gold intercepts like 26 meters at 4.36 grams per tonne of gold. Down at # 5, and we own the land under this, drilling in El Paso, which also resulted in several significant intercepts, including 8.2 meters at 3.74 grams per tonne.

And then last but not least, at #6, we commenced testing Peak Hill for its gold copper porphyry potential. And number seven, we're conducting geophysical targeting and drill testing for low sulfidation epithermal gold quartz veins at Glen Isla. What I want to show you here is that a lot is happening at Tomingley to expand the resources. And more importantly, the sheer volume and range and distance of this work alone demonstrates big potential and the reason why we continue to focus on exploration.

So let's move on to Slide 10, Bjorkdal exploration. Here, we invested AUD 2 million on a program at # 3 there, Storheden on 2 programs to test the Northern and Eastern depth extensions #1 and 2 with the goal of extending the ore body that's currently being mined.

So for example, at Storheden, the #3, the results of this drilling highlighted the doubling of the known depth and extent within a series of Bjorkdal, just like the deposit to the south style veins interpreted across 3 target domains. This was all released in December. The highlight results included 34 grams a tonne over 1.6 meters, 142 grams a tonne over 0.6 meters and 111 grams per tonne over 0.5 meter. This narrow vein, high grade, this is the backbone of what we see at Bjorkdal, and we've got the expertise to mine these type of veins, either narrow vein or over broader swarms efficiently. In additional, over at #4 to the right of your page, work has recently commenced to extend the Norrberget resource.

So let's move on to Slide 11. At Costerfield, we invested AUD 6 million in Q2 on near-mine drilling with 3 main focus areas. Number one, Brunswick South drilling. We focused there on building the high-grade intercepts we discovered earlier in the year, so earlier in 2025 with progression to infill drilling late in the quarter. And number two, Kendall drilling, we're exploring a series of veins, quite high grade above the currently active Youle workings. And number three, the Sub King Cobra, we call it, we're drilling focused both on infill and extending the mineral resources below the existing Cuffley and Augusta workings. But additionally, perhaps even more excitingly, numbers 4 and 5, True Blue has progressed with 3 diamond rigs predominantly concentrating on infill drilling with a focus on step-out testing at our surface geochemical anomaly there. Meanwhile, #6, we're also testing the potential for a Sunday Creek style mineralization -- mineralization just below Costerfield's historic mines.

So moving on to Slide 12. This is the Northern Molong Porphyry project, the entirety of which is shown on the map of this slide or stylized map on this slide, and this is a highly prospective gold and copper corridor. This project also encompasses in the bottom right of your page, our Boda-Kaiser copper gold project. During the quarter, we invested AUD 3 million on several programs, including a mobile magnetotelluric survey we completed across most of the deposit you see there, and we think this will guide us towards future high-value work programs. And we continue to make progress on a 4,500-meter reconnaissance drill program to learn more about the project's potential. Of course, we'll announce results as we receive them. What I want to make clear to you, the reason why we're focused on this is we're looking to further increase the already substantial gold and copper inventory.

This project and what can come from it is incredibly leveraged to the current price. As you can see, the exploration work going on at each of our projects. Our goal is to expand resources to increase mine life production levels and drive new discoveries. Undoubtedly, I want you to see that exploration is a key pillar of our strategy that's fundamental to our organic growth objectives.

And with that, I'm going to hand over to you now, Jim, to provide a review of our financial performance. Thanks.

Thanks, Nic. So if everybody could -- we'll turn to Slide 13. And so I'll start with an overview of the key financial highlights for the second quarter ended December and also the 6 months ended -- or the first half, which is the 6 months ended December as well. So we'll focus on these 2026 results because the results for the prior year do not include the former Mandalay operations. So consolidated revenue for the quarter was AUD 256.7 million at an average realized price of AUD 5,785 per ounce or around about USD 3,857 per ounce. And that was 18% higher than our Q1. Average antimony prices were AUD 42,500 per tonne or about USD 28,327 per tonne.

And that was 19% higher this quarter than the previous quarter. These are record revenues were achieved in the second quarter. They were a result of strong operations, robust gold and antimony prices. And cash flows for our second quarter could have been a bit higher, about AUD 18 million higher. We had a shipment from Costerfield that sort of departed around the Christmas period. So -- that payment, which normally would be received a little bit quicker sort of because of the Christmas holiday period that came into -- received in early January, and that will be recognized in our Q3 cash flows.

Site operating costs on a consolidated basis were AUD 2,031 per gold equivalent ounce produced. That was about 8% lower than the September quarter. This is a result of improved throughput levels, capturing some synergies from the merger and just trying to be -- maintain the cost discipline. All-in sustaining costs were AUD 2,739 per gold equivalent ounce or about USD 1,826 an ounce produced. That's about 8%. That was also 8% lower than the previous quarter. So at these cost levels, we are within our 2026 guidance range. EBITDA for the second quarter was a record AUD 147.2 million. Sustaining capital during the quarter, that was AUD 20 million.

That included AUD 10 million for capital development at our Bjorkdal operation in Sweden and AUD 4 million of mining ancillary equipment at Bjorkdal and Tomingley. Our growth capital in the quarter was AUD 9 million, and most of that was at the Tomingley operation on the Newell Highway alignment, which Nic touched on a little bit earlier on the Tomingley slide. So for the event, that gives us access to the eventual mining of the San Antonio open pit in 2027. Exploration expenditures for the second quarter were AUD 11 million, and I think that was all captured by -- in the slides that Nic was talking about just slightly earlier.

So if we turn to Slide 14, now, and we're really -- we're having a look at our second quarter cash flow. So in the December quarter, cash flow from our 3 operations was AUD 133 million or 82% higher than the first quarter. Corporate and other expenses were AUD 20 million. That included AUD 7 million for corporate and technical support across the group, AUD 6 million for a cash-back bond, which we were required to put down as part of our Newell Highway realignment project.

That's a bond that sort of will come back to us over the course of the next 18 months or so upon successful completion of that project and AUD 3 million for Boda exploration at about AUD 2 million for Lupin closure costs. So after all of that, after sustaining capital growth, exploration, taxes and corporate, we ended the quarter with AUD 218 million in cash. So overall, there a AUD 58 million increase from the September quarter, which was really pleasing.

So at December 30, 2025, liquidity remains exceptionally robust. We got cash bullion listed investments totaling AUD 246 million. So we've got a clean balance sheet. debt is just limited to some equipment financing for our mobile equipment across the group. So that's just giving us a really enviable financial foundation that we think that [indiscernible] and the peer group can match, underpins the foundation to grow the business, pursue our organic growth targets, which Nic had spoken about a bit earlier and gives us flexibility to act on strategic value accretive opportunities as they arise.

So with that, I will turn the call back to you, Nic.

Thanks, Jim. All right. Let's go on to Slide 15. I want to focus on our outlook, which I think you can see has a pretty clear momentum. Leveraging the financial strength Jim just outlined, we're well positioned to scale up our business. We've got a dual track strategy. We're fueling growth while keeping a sharp focus on cost efficiency, a discipline that's reflected through the maintenance of our 2026 guidance. With our record-setting first half behind us, we're carrying a lot of energy into the remainder of the year.

We're firmly on track to achieve the annual production minus the July Mandalay of 155,000 to 168,000 gold equivalent ounces. But as I say, let's look at this 3 operations for 12 months, 100% basis, full year guidance is pretty impressive, 160,000 to 175,000 gold equivalent ounces. Now on the cost front, we're disciplined. We want to drive down the cost at Bjorkdal. We're disciplined. We've got a consolidated all-in sustaining cost firmly on track at AUD 2,600 to AUD 2,900 per ounce. So this is US between USD 1,690 and USD 1,885 per ounce. The real story is our impressive commitment to organic growth.

We're putting AUD 78, somewhere, it will land somewhere between AUD 78 million and AUD 88 million into growth capital and exploration to unlock the next chapter of this company. Tomingley, I don't want you to see this is just infrastructure. It's a gateway. This realignment of the Newell Highway is the key that unlocks the high-grade large-scale San Antonio deposit in about a year from now. And at Costerfield, our objective here for drilling is clear. We're extending the mine life and building the case for potential future processing expansion. And over at Bjorkdal, our focus is on precision.

We're building a high-grade inventory that we want to redefine our future mine studies and increase the mining rate. So this guidance is more than just set of numbers, it's a road map that we're trying to build a larger platform achieving the vast potential of this business.

So let's move to Slide 16. What you can see on this slide is more than just a plan. We have a commitment to performance, and we're delivering on that. We're squarely positioned to meet our production targets, but we're not stopping there. We're deploying the drill bit, which I've talked about across the entire portfolio to expand the resource base. This is the bedrock of the strategy, extend mine life and accelerate production growth at all 3 operating mines. And let's not forget Boda-Kaiser. This world-class copper-gold porphyry project remains an important part of our long-term value. We're moving with a purpose on the environmental studies, the permitting and the consultation to advance this project.

And in doing so, we're giving ourselves maximum flexibility to consider ways to unlock value. Corporately, our balance sheet is a clear strategic advantage above our peers. In this gold price environment, we expect to continue building our cash position. And as we seek inorganic growth opportunities, we're well positioned to move quickly but with discipline, and we have strong financial flexibility. We're confident, we're focused. We're well positioned to drive long-term value for the shareholders.

And with that, I'll hand the call back to the operator to start the Q&A session. Thanks, operator. Over to you.

[Operator Instructions] We're going to take the first question on the line. And it comes from the line of Daniel [indiscernible] from [indiscernible].

Congratulations on the very nice results. I have a question and I guess, a comment. So my question is you announced an ADR -- sponsored ADR program, and you already have an unsponsored ADR program and the shares trade in Canada and also Australia. And I know you talk all the time about increasing liquidity. And I'm just curious whether basically having these 4 venues for where your shares are trading is actually fragmenting liquidity and not really increasing it. That's my first question.

Yes. Thanks, Daniel. How about I answer that and you can ask the second part if there was one. Yes, clearly, we took a fair bit of advice out of North America on this one. The clear expectation that we think will occur is that most people will go with the issuer-sponsored ADR because of the increased liquidity that will come there rather than the nonsponsored vision just because the liquidity will be less there. And what's really interesting is what we wanted to do, and it remains to be seen whether this is correct, right? But what we wanted to do was create a vehicle for particularly retail investors in North America to be able to access the stock with liquidity in a clear price point because there would appear to be, particularly as gold has such interest, quite a degree of people that are using that mode and method and who just don't access the TSX and the ASX. So we're watching with interest, and we certainly think that it's something that we should try in this market.

Okay. And 2 more, if you don't mind. You talked a lot -- no, no, recently, you mentioned your aspiration to get into the ASX 200. And I recall at the time of the merger with Mandalay, there was a lot of talk about what a wonderful thing it would be to join the ASX 300. But it doesn't seem like joining the ASX 300 has done anything. I mean I look at this Edison report and that shows how undervalued you are compared to your peers and so forth. So I just wonder whether aspiring to join the ASX 200 is just sort of a waste of energy.

I -- you've got me a little bit baffled there because -- and happy to get you all comment on in case I've misinterpreted what you said. So if you look at Alkane and Mandalay pre this, Alkane's typical turnover was AUD 1 million a day. And Mandalay's at one point was AUD 0.5 million and then it rose up to be similar. And then post the merger, we are typically AUD 8 million to AUD 9 million. Mandalay is AUD 1 million to AUD 1.5 million. And we have seen a lot of index funds enter our register. And then from the point that we stabilized at in share price of a nominal sort of AUD 1.10, we've seen a drive up to AUD 1.50 with a lot of buying come across in the 12 months. So certainly, the index inclusion appears to have helped the register, the buying the share price to support the visibility of it. And all our understanding is that the ASX 200 will further deepen that pool. Are you looking at information that I'm not looking at, so I've misinterpreted you.

No, I just -- I'm not looking at sort of liquidity or trading volume and so on. I'm just looking at the valuation of the company compared to what at least Edison considers your peers. And the stock has been -- remains quite undervalued. And I just wonder whether joining these indices really helps at all.

I think if we -- look, I think if we had not joined the indices, then we would be horrendously undervalued, not just undervalued. So if you look at some of the peers that we have, like if you take, for instance, Catalyst and Ora Banda, they have passed into the ASX 200, both with an uplift in buying that's coming from that. And so as to where all these things settle, I think the fundamental basis of our cash flow, our reasonably consistent production performance. Of course, that has to shine through. And the index inclusion should be something that simply flows from that. But there's certainly value in exposure to a very large volume of money in the Australian superannuation funds being an ASX 200 versus ASX 300.

Okay. Great. And then if you don't mind, one final thing. So you've built up this large cash pile here, and you talked about the uses. I'm curious what the priorities are. You've got this quite exciting Boda-Kaiser project, and I imagine that will potentially involve a lot of CapEx. Mandalay, as I remember, years ago, used to pay a dividend and some of these large gold companies that you aspire to emulate pay dividends. And then you talk about corporate development and so forth. I'm just curious if you could talk a little bit about your priorities. And just one final thing. This earn-in seems like a very clever deal. But it would seem to me that proving that Mandalay has been -- or is a great deal would go a long way towards convincing people that the next deal is going to be a good one. That's it for me.

Yes, sure thing. A couple of different things to unpack within that. So let me -- hopefully, and you can come back to me if I miss one of them, my apologies. So if we look at -- our analysis suggests that right now, we can create more value for our shareholders by delivering on production, reinvesting into the businesses to keep the costs low, expanding the resource base and then also inorganic growth where other businesses are undervalued. And so that's our view.

[indiscernible] more undervalued than you are.

Yes, of course, me.

Okay. Yes. I'm sorry, I interrupted.

Yes. No, no, it's not the interruption. It's the assumption that we go and pursue a business that's higher value than we are. Anyway, so -- so then when we look at dividends, if you look at our peers on the ASX, of the top 20 gold companies, about 5 or 6 pay dividends at present. So clearly, as a Board, we look at that each time we meet around dividend and capital allocation. At the moment, our view is that we will continue to look for those internal things to create shareholder value. And then clearly, if we don't see that and our cash balances rising, then we would look to return those to shareholders, yes.

So the second part of what you said is we're referring to the Nagambie earn-in. I think the thing that is really key to understand there is that there's a 30-day right of first refusal that Southern Cross [ hold ] on a deal they did with Nagambie a long time ago. I couldn't give you the exact timing. So they may either elect to match that or not. In the event that they don't elect to match that, yes, we're pretty interested in really seeing if the potential that we think could exist there at the Nagambie deposit does because logically, it could absolutely either dovetail into the later years of Costerfield or in an ideal world, allow an expansion of that facility. All those things would need approval.

Yes. And last but not least, you spoke about convincing people that the Mandalay deal has been a success in order to do it. Yes, I can't -- of course, I can't say what the parallel history would have been if we hadn't have done the deal. We don't know in this rising gold price environment. But certainly, -- as a combined entity, both of us have had more value realized in our stock and our price to NAV and all the other multiples than we were equivalently on our own. So it certainly appears successful in all of those metrics. And certainly, a share price that's been achieved for Alkane or Mandalay in reverse that just did not appear possible on a stand-alone basis. So certainly, that's the feedback I'm getting from the vast majority of share.

[Operator Instructions] And at this moment, we will proceed with the written questions. Natalie over to you.

Thank you, Nadia. I'm heading off to the written questions. So for M&As, where is your focus from a geographic perspective? Do you see any opportunities to build on operations in Australia and Europe? Or are you looking in other regions?

Yes. Thank you. Australia, New Zealand, U.S., Canada, Scandinavia.

Awesome. Thank you. Mandalay was very excited about True Blue. Is that the highest potential target at Costerfield? Or do you see another target as a priority?

Yes. Good question in terms of -- it depends on the time frame that you're talking about. So Kendall and Brunswick South are the near-term targets that we're most excited about. But I don't see either of those containing 300,000, 400,000 ounces at the moment. They appear to be more incremental adding of 1 or 2 years production. So True Blue, we're more excited about from a longer-term perspective because indications are that we may be able to replicate the entire corridor length that we see all the way Augusta to Brunswick, all the old mines, which have pulled over 1 million ounces out at [indiscernible] in the past. So that's -- so time frame-wise, True Blue, yes, is a more exciting prospect for us.

What exploration target or opportunity within your existing portfolio most excites you?

I think again, it depends on which hat you want to put on. I'm most excited by the potential of discovering a swan -- like a similar Swan Zone type thing as seen at Fosterville, discovering a similar thing deep at Costerfield. But that is a very long-dated bet, but it is the most exciting because of how transformational is in that sheer volume of ounces that they had. Yes. Hopefully, I've answered that, but please write another question if I've misanswered your question.

We're halfway through quarter 3 and gold prices are higher than quarter 2. What visibility into quarter 3 results can you share with us at this stage?

Yes. So we're -- our full year guidance is on a 12-month basis is 160,000, 170,000 ounces. And on the half year, we were a bit over 80,000 ounces equivalent and just under the top end of that guidance. So we expect a quarter similar to the quarter we just had. So yes, we're very happy with where we're at.

When do you think you might be in a position to make a decision on processing expansion at Tomingley?

Yes. So I think people may have seen some of the subtlety in what I've described. So at the moment, we're achieving what we were hoping to achieve or had planned to achieve, sorry, with the plant expansion. We're achieving that with pre-crushing. We're probably -- we were hoping to add 450-odd thousand tonnes of extra throughput on the addition of about AUD 45 million capital expansion. And we thought that we would try a whole heap of other things given all the money that we've invested into the circuit. On fine grind and all that sort of stuff.

And pre-crushing was one of the things that we considered. And at the moment, we're north of 1.3 million tonnes per annum and with a line of sight of 1.4 million tonnes per annum. So all things going smoothly, I think that we will continue to eke out really small throughput improvements of the existing Tomingley plant because chasing effectively, we'd be putting AUD 45 million in for 100,000 to 150,000 tonnes per annum, which is not quite the case. And we don't have the, in my view, the ore resources yet until we get another major, major discovery of the size of Roswell to warrant updating the plant to say, 2 million tonnes per annum or something. Hopefully, that makes it clear for people.

[Operator Instructions] I've got another question in here. Given your strong cash position and the high price of gold, has consideration been given to buying out your hedging position?

Yes. I mean, as you can imagine, we talk about this at each Board meeting. We talk about all the financial instruments that we have or could put in place. One of the other things we do is we talk a lot to our shareholder base about it. And the current view at present is to deliver into the hedges in accordance with the schedules that we publish now, quarterly reports. One of the reasons for this is we're in a very, very volatile gold price environment at the moment. And the feedback from a lot of our shareholders is that they wished to be the ones taking the gold risk that we were a known quantity themselves. So that's our current plan. Obviously, we continue to review that. And then even in some of the things with Daniel cash balance, all these other things are things that we take into account. But at the moment, if you're putting together a financial model, just assume that we are delivering into the hedge book.

Right. Excellent. We have no further questions. So I'll hand the call over to Nic for closing comments.

Great. Thanks, everyone. I appreciate you taking the time to join us today. And look, whilst as per one of the questions Nat just asked, look, we've had a successful year so far, and we really look forward to showing you more of this progress and showcasing for those of you in North America, getting people here in Australia to understand these assets more and reflecting more of the value that exists in these really strong cash flows into our share price. So look forward to our next call in a few months. And as always, reach out if you have any questions. Have a good day, everyone. Appreciate it. Cheers.

This concludes today's conference call. Thank you for participating. You may now all disconnect. Have a nice day.