Key Highlights

•  Genesis produced 72,107 ounces and sold 71,594 ounces at an average A$5,902 an ounce, generating Revenue of A$422.5 million.

•  AISC was A$2,966 an ounce, up from A$2,797 in the June quarter, and cash and liquid investments rose to A$598 million.

•  The scheme meeting on the proposed Vault Minerals Merger is in November, with integration, Capital spending and the end of hedging among the risks.

Genesis Minerals (ASX:GMD) produced 72,107 ounces of gold in the September 2026 quarter and lifted its cash and liquid investments to A$598 million, according to its Quarterly Report released last week. The result comes ahead of a scheme meeting in November on the company's proposed merger with Vault Minerals, and just before Genesis committed A$30 million to a capital raising by Brightstar Resources.

Quarterly performance

Gold sold totalled 71,594 ounces at an average price of A$5,902 an ounce, generating revenue of A$422.5 million. All-in sustaining costs (AISC) were A$2,966 an ounce, up from A$2,797 in the June quarter. Executive Chair Raleigh Finlayson said operations "delivered comfortably in line with guidance".

Mine Operating Cash Flow was A$213 million, and net mine cash flow was A$162 million after A$51 million in growth capital. Underlying cash build for the quarter was A$157.4 million.

At the Leonora mill, Genesis processed 368,000 tonnes at 4.1 g/t gold, recovering 44,100 ounces at 91.9%. The Gwalia underground mined 27,400 ounces at 4.9 g/t, and Ulysses mined a record 17,400 ounces at 3.8 g/t. The Laverton mill processed 756,000 tonnes at 1.2 g/t, recovering 27,900 ounces. Wet weather constrained output at the Admiral open pit, which mined 15,900 ounces at 1.2 g/t. Open-pit Mining at Hub was completed ahead of schedule in early September, while Jupiter delivered a record 13,100 ounces.

Balance sheet and dividend

Cash and equivalents at 30 September were A$598.0 million, comprising cash of A$564.7 million, bullion of A$10.1 million and liquid investments of A$23.2 million. Bank Debt stood at A$200 million, with a further A$100 million undrawn, giving net cash of A$398.0 million. Genesis also has about A$84 million in asset finance liabilities.

The company paid a maiden fully franked Dividend of 5 cents a share, about A$59 million, on 5 October. Its final 4,500 ounces of zero-cost collars were delivered during the quarter at A$4,235 an ounce, leaving Genesis unhedged. It expects an income tax catch-up payment of A$100 million to A$120 million in the December quarter.

Guidance and growth projects

Stand-alone FY27 guidance was unchanged at 270,000 to 300,000 ounces at an AISC of A$2,750 to A$3,050 an ounce, with second-half costs expected to be lower. Growth capital is forecast at A$380 million to A$420 million, including A$140 million for a new Tower Hill mill that the company says the Vault merger would make unnecessary.

Tower Hill holds an ore reserve of 17.0 million tonnes at 2.0 g/t for 1.1 million ounces, with first ore on track for FY28. At Laverton, Bruno Lewis is expected to deliver first ore in the December quarter.

The Vault merger

Genesis proposes to acquire all of Vault Minerals through a scheme of arrangement. The scheme booklet was released on 6 October, with the scheme meeting scheduled for 11 November and implementation for 26 November, subject to Shareholder and court approvals. Genesis cites potential post-tax, undiscounted synergies of about A$2.0 billion and pro forma production of roughly 625,000 to 675,000 ounces a year. Synergy estimates are management projections and may not be fully realised.

On 27 October, Genesis agreed to invest A$30 million in Brightstar's A$82 million placement, lifting its holding from 0.8% to about 5.4%. Genesis previously bought ore from Brightstar under an ore purchase agreement, although no third-party ore purchases were recorded in the June or September quarters.

Risks and next steps

Key risks include integration of a much larger combined business, rising capital spending, the December tax payment and gold price exposure now that hedging has ended. Synergy delivery depends on combining processing capacity and mine plans, which can take time. The Vault scheme vote on Wednesday 11 November is the next major milestone, followed by implementation and an updated combined outlook.