29Metals (29M) Q2 2024 earnings summary

Executive summary

• Golden Grove delivered record copper production of 6.4kt (up 11% sequentially) and zinc production of 15.3kt (up 225%), with operational improvements and ramp-up at Xantho Extended.

• Capricorn Copper operations remained suspended after processing 0.7kt copper from stockpiles, with focus on water management, site readiness, and long-term tailings solutions for a sustainable restart.

• New CEO James Palmer commenced 1 May 2024, emphasizing safety, productivity, and cost discipline.

• Group safety metrics deteriorated: TRIF rose to 9.2 and LTIF to 2.3 (12-month moving average per million work hours).

• Balance sheet strengthened by a new US$50 million offtake finance facility and improved liquidity.

Financial highlights

• Unaudited revenue for the June quarter was $127 million, down 18% from the prior quarter due to lower copper and zinc sales.

• Unaudited available group liquidity at 30 June 2024 was $130 million, up from $106 million at 31 March 2024, including $85 million cash.

• Net drawn debt increased to $136 million at 30 June 2024 (from $103 million at 31 March 2024).

• Corporate cost guidance for 2024 reduced to $28–31 million (from $32–36 million), reflecting cost reductions post Capricorn Copper suspension.

• US$50 million offtake finance facility with Glencore finalized; US$20 million drawn in the quarter.

Outlook and guidance

• No change to 2024 production or operating cost guidance for Golden Grove.

• Golden Grove is expected to maintain higher ore production in the second half, with full-year zinc production guidance second-half weighted.

• Growth capital guidance increased to $35–40 million (from $20–25 million), mainly due to expanded TSF4 scope and cost escalation.

• Capricorn Copper restart is unlikely before 2026 due to the time required for meaningful water reduction; rest-of-year capital and operating costs expected at $10–15 million and $20–22 million, respectively.

• Cash outflow reductions expected into 2025 as compliance and water reduction projects complete.