Highlights

  • Broken Hill Mines shares rose 4.05% to AUD 0.77 on 24 April 2026.
  • Silver production increased 51.7%, lead rose 48.5%, and zinc grew 7.9%.
  • Average ore grade improved 29% during the quarter.
  • Sales revenue increased 34% to A$27.2 million.
  • Operating cash flow turned positive at A$2.4 million, up 45%.
  • Total liquidity stood at A$75 million, including A$44 million in cash

Broken Hill Mines Ltd (ASX:BHM) shares increased 4.05% to AUD 0.77 during the afternoon session on 24 April 2026, extending gains to 63.38% over the past year. The upward movement follows the company’s March 2026 quarterly update, which highlighted improved production metrics, higher ore grades, and positive operating cash flow.

The update reflects continued progress in ramping up operations at the Rasp Mine, alongside advancements in exploration and development activities. While some pricing pressures were noted toward the end of the quarter, overall operational and financial improvements appear to have supported investor sentiment.

Company Overview

Broken Hill Mines Ltd is focused on the production and development of silver, lead, and zinc assets in Australia, with its flagship Rasp Mine located in New South Wales. The company is progressing a multi-stage ramp-up strategy to increase processing capacity to 750,000 tonnes per annum, supported by multiple ore feed sources.

Its broader strategy includes expanding resource potential through drilling programs, advancing development projects, and improving operational efficiency to support long-term production growth.

Production Growth Driven by Higher Grades and Additional Feed Sources

During the March 2026 quarter, Broken Hill Mines reported continued improvement across key production metrics.

Ore processed increased to 115,653 tonnes, representing a 3.6% increase compared to the previous quarter. More notably, the average ore grade rose 29%, supported by the introduction of higher-grade ore from the Main Lode alongside existing feed from Western Mineralisation.

This improvement in grade translated into higher metal output. Silver production increased 51.7% to 78,649 ounces, lead production rose 48.5% to 2,473 tonnes, and zinc production grew 7.9% to 3,113 tonnes.

The company indicated that further increases in ore feed are expected as contributions from the Main Lode continue to ramp up, with additional supply anticipated from the Pinnacles Mine in upcoming periods.

Rasp Mine Ramp-Up Progress Continues

Operational progress at the Rasp Mine remained a key focus during the quarter.

The company transitioned from contractor-based underground development to an owner-operator model in February 2026, with internal development activities now underway. Development work progressed across multiple areas of the Main Lode, including Blackwoods South, with further focus on Blackwoods North and Thompsons zones.

Processing performance improved, with higher feed grades and stable recovery rates. Zinc recovery increased to 87.3%, while lead recovery rose to 86.1%.

Expansion initiatives are also advancing, including the Tailings Dewatering Plant (TWP), which is expected to support an increase in processing capacity to 750,000 tonnes per annum. The TWP is targeted to be operational by January 2027.

Exploration Activity Supports Resource Growth

Exploration remained a significant component of the company’s growth strategy during the quarter.

Over 16,500 metres of drilling were completed across the Rasp and Pinnacles projects, with a broader 42,000-metre drilling program for 2026 progressing as planned.

At Pinnacles, approximately 8,000 metres of drilling were completed during the quarter, targeting extensions of known mineralisation zones and refining geological understanding. The drilling program delivered high-grade silver, lead, and zinc intercepts, with additional results pending.

Notable intercepts included zones such as 5.1 metres at 25.9% zinc equivalent and 717 g/t silver equivalent, as well as several near-surface intercepts supporting potential open-pit expansion opportunities.

The company expects that ongoing drilling results will contribute to planned Mineral Resource updates later in 2026.

Financial Performance Reflects Improving Operations

Broken Hill Mines reported improved financial outcomes during the March quarter, supported by higher production and operational efficiencies.

Notional sales increased 34% to A$27.2 million, while sales revenue (excluding quotational periods) reached A$25.5 million. Actual cash receipts were A$30.0 million, reflecting inventory movements and prior period sales.

Operating cash flow turned positive at A$2.4 million, representing a 45% increase compared to the previous quarter. This marks a transition from negative operating cash flow recorded earlier in the financial year.

Production costs declined by approximately 6% to A$19.0 million, despite increased output levels. Growth capital expenditure also decreased by 28% to A$10.1 million, reflecting the transition to owner-operated development activities.

The company continues to target consistent free cash generation during 2026 as ramp-up activities progress and capital requirements moderate.

Balance Sheet and Liquidity Position

As of 31 March 2026, Broken Hill Mines reported total liquidity of A$75 million. This includes A$44 million in cash, as well as additional liquidity from unsold concentrate inventory and available credit facilities.

During the quarter, the company drew US$7.5 million from its financing facility, with an equivalent amount remaining undrawn. It also repaid A$9.1 million under its offtake revolving credit facility.

The company noted that its financial position remains supported by ongoing operational cash flow and improving production metrics.

Pinnacles Mine Advancing Towards Production

The Pinnacles Mine represents the third feed source for the Rasp operation and is progressing toward initial production.

Early works and operational readiness activities were completed during the quarter, with mining operations expected to commence in the June 2026 quarter.

The project includes both open-pit and potential underground development opportunities, supported by drilling programs that continue to confirm consistent mineralisation across the deposit.

The company is also evaluating the development of an exploration decline at Pinnacles, which could support future underground mining activities.

Strategic Agreement Expands Processing Opportunities

During the quarter, Broken Hill Mines entered into a strategic mining and processing agreement with Kingfisher Mining.

The agreement establishes a framework under which ore from Kingfisher’s tenements may be mined and processed at the Rasp Mine. This arrangement is intended to support additional feed sources and accelerate the development of high-grade targets within the joint venture portfolio.

What This Means for Investors?

Broken Hill Mines’ March 2026 quarterly update reflects continued operational progress, particularly in terms of higher grades, increased production, and improving cash flow.

The ramp-up of additional feed sources, including the Main Lode and Pinnacles, appears to be supporting production growth and operational efficiency. At the same time, declining costs and reduced capital expenditure indicate improving financial discipline.

While metal price movements toward the end of the quarter impacted realised revenue, the overall improvement in operational performance and cash generation appears to have contributed to the positive share price reaction.

Investors are likely to monitor the company’s ability to sustain production growth, deliver further resource expansion, and transition toward consistent free cash flow generation in the coming periods.