29Metals (29M) Q2 2024 earnings summary

Executive summary

• Golden Grove delivered record copper production of 6.4kt (up 11% sequentially) and zinc output 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, restart planning, and site readiness.

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

• Balance sheet strengthened by a US$50 million offtake finance facility with Glencore, US$20 million drawn during the quarter.

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

Financial highlights

• Unaudited revenue for the June quarter was $127 million, down $27 million from the prior quarter due to lower copper and zinc sales.

• Unaudited 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.

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

• $16 million in insurance proceeds received related to Capricorn Copper weather event.

Outlook and guidance

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

• Growth capital guidance for Golden Grove increased to $35–$40 million, mainly due to expanded TSF4 project scope and cost escalation.

• Capricorn Copper restart is unlikely before 2026, pending substantial water reduction and tailings solution approvals.

• 2024 capital and operating costs for Capricorn Copper expected at $10–$15 million and $20–$22 million, respectively, with outflows to decrease in 2025.

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