Red Hill Minerals (ASX:RHI) Limited has reported royalty receipts of A$7.7m for the quarter ended 30 September 2026, and said it paid a fully franked dividend of A$6.9m, or 10.8 cents a share, on 30 September. In its quarterly activities report, the company said cash fell to A$58.7m from A$62.8m at 30 June 2026, with no debt drawn or available.

Cash flow and the dividend

Besides royalty receipts, Red Hill received A$0.5m of interest. The company reported operating cash flow of A$4.8m, investing outflows of A$1.9m and financing outflows of A$7.0m. Outflows included the dividend, A$2.5m of income tax and exploration spending. The cash decline of about A$4.1m was mostly the result of the dividend and tax payments.

Royalty assets

The main earner is the Onslow Iron royalty, a 0.75 per cent free-on-board royalty on a project operated by Mineral Resources. Red Hill reported royalty revenue of about A$6.0m on 8.54 million dry tonnes shipped. It said the operator reports an annualised shipping rate of 36.9 million wet tonnes, above nameplate capacity, but noted that rising shipping costs linked to the Middle East conflict are a cost pressure.

Red Hill also holds a 2 per cent gross revenue royalty over deposits at Sandstone operated by Brightstar. The company said the royalty-covered deposits now hold a resource of 1.34 million ounces of gold, an increase of 295,000 ounces. Brightstar plans a further resource upgrade, a pre-feasibility study and a maiden ore reserve in the second half of calendar 2026, and raised A$82m after the quarter end, including A$30m from Genesis. In addition, Red Hill acquired the Thomson royalty, a 1.5 per cent net smelter return over a project held by Legacy Minerals, for A$220,000. Legacy can repurchase half for A$2m and the remainder for a further A$4m. Red Hill noted that it relies on public information for its royalty assets and has limited independent verification.

Exploration activity

At Anabama in South Australia, part of the Curnamona joint venture, two diamond holes totalling 1,431 metres were drilled. The first returned multiple narrow, high-tenor copper-gold zones near a downhole electromagnetic conductor, while the second found chalcopyrite at a new contact, including 7 metres at 0.7 per cent copper from 628 metres. Spectre Metals declined to fund further expenditure and will dilute its interest.

At Broken Hill in New South Wales, a 1,700-metre program has begun at Dementus and Furiosa. In the West Pilbara, an 18-hole, 3,476-metre reverse circulation program returned modest gold results, such as 6 metres at 0.4 grams per tonne from 172 metres at G1, and no significant results at King Brown. Red Hill also reported an exploration incentive grant of up to A$180,000 for diamond drilling at S-Bend, with drilling planned for next year, and lodged a PACE application at White Rocks that could provide co-funding of up to 50 per cent, capped at A$350,000.

Pannawonica iron ore

This asset is separate from the royalties.

The company's wholly owned Pannawonica iron ore project has an ore reserve of 4.7 million tonnes at 56 per cent iron and a mineral resource of 62.5 million tonnes at 53.4 per cent iron. Draft heritage reports have been received, with finalisation expected next quarter.

Risks and next steps

Cash fell during the period even though royalty income remained solid, because the dividend and tax payments exceeded the net inflows.

Red Hill said its royalty income depends on the operations of third parties and on shipping costs, and several exploration results were modest. Milestones it listed include a downhole electromagnetic survey of the Anabama hole and drilling at Dementus and Furiosa in November 2026, the finalisation of the Pannawonica heritage report next quarter, Brightstar's pre-feasibility study and maiden ore reserve in the second half of calendar 2026, and S-Bend diamond drilling next year.