Arafura Rare Earths (ARU) Q1 2026 earnings summary

Executive summary

• Nolans is a construction-ready, ore-to-oxide rare earths project with a 38-year mine life, fully permitted and positioned as a globally significant asset with advanced engineering and robust project economics.

• Identified as a priority project under the US-Australia Critical Minerals Framework, unlocking new financing and strategic opportunities.

• Significant progress made toward funding, with major government and institutional support secured post-quarter end.

• Three binding offtake agreements now cover 66% of the target, with further negotiations ongoing for German and European markets.

• A two-tranche placement of ~A$475m, including a A$125m commitment from Hancock Prospecting and a A$50m share purchase plan, is underway to secure the public market equity component for Nolans.

Financial highlights

• The offer price is A$0.28 per share, a 25.3% discount to the last closing price and a 38.6% discount to the 5-day VWAP.

• Cash balance at 30 September 2025 was A$90 million, up from A$27 million at 30 June 2025.

• Proceeds from the placement and SPP, combined with existing cash, total A$634m, allocated to project capital costs, financing, working capital, and transaction costs.

• Net cash used in operating activities for the quarter was A$4.3 million; investing activities used A$0.6 million; financing activities provided A$67.2 million.

• Estimated 18.3 quarters of funding available based on current cash burn and cash reserves.

Outlook and guidance

• Targeting cornerstone equity commitments by end of 2025 and Final Investment Decision (FID) in Q1 2026.

• Project execution schedule from FID to start-up is 41 months, including a four-month ramp-up period.

• Projected to be in the first quartile of the cost curve, with robust economics: post-tax NPV of US$1.9bn (base), IRR of 18.1%, and average annual EBITDA of US$472m.

• Ongoing engagement with lenders and offtake partners to secure remaining funding and sales agreements.

• Phase 2 expansion potential under study, aiming to process third-party feedstocks and scale with demand growth.