Key Highlights

•, the new crushing, milling and carbon-in-leach circuits are running continuously, with steady-state throughput of 6.5 million tonnes a year.

• The company expects the expanded operation to produce about 150,000 ounces of gold annually, with a mine life of more than ten years on current reserves.

• For the year to 30 June 2026, Capricorn reported the following from the company's 27 August 2026 release:.

• - net profit after tax of $327.2 million, against $206.4 million in FY25;.

What does the completed Karlawinda expansion mean for Capricorn Metals (ASX:CMM)? In short, it gives the Western Australian gold producer a larger processing plant just as it reports record earnings, but it also moves the company into a phase of higher unit costs and heavier execution demands.

The central development

, the new crushing, milling and carbon-in-leach circuits are running continuously, with steady-state throughput of 6.5 million tonnes a year. The company expects the expanded operation to produce about 150,000 ounces of gold annually, with a mine life of more than ten years on current reserves.

The importance is straightforward. Capricorn's Earnings come from one operating mine, so throughput is the main lever for volume. A larger plant lifts the ceiling on ounces without requiring a new mine.

What Capricorn does

Capricorn Metals is an Australian gold producer. Its only operating asset is the Karlawinda Gold Project in the Pilbara region of Western Australia, an open-pit mine feeding a conventional processing plant that produces gold bullion. Revenue is therefore almost entirely a function of ounces sold multiplied by the Australian-dollar gold price.

Capricorn is a price-taker, and its results move with bullion. The company's second project, Mt Gibson in the Mid-West region of Western Australia, is in development rather than production, so it contributes spending today rather than revenue.

Record results for FY26

For the year to 30 June 2026, Capricorn reported the following from the company's 27 August 2026 release:

• sales revenue of $769.3 million, up 46%;

• underlying EBITDA of $483.6 million, up 63%;

• net profit after tax of $327.2 million, against $206.4 million in FY25;

• net cash of $504.8 million at year end;

• Operating Cash Flow of $470.2 million.

Gold production at Karlawinda was a record 123,589 ounces. The company sold 123,096 ounces at an average price of $6,241 an ounce, with All-In Sustaining Cost (AISC) of $1,629 an ounce. The average realised price was nearly four times the AISC.

Capital expenditure was $133.4 million, mainly on the expansion and early works at Mt Gibson, and exploration spending was $74.0 million across both projects. The final Dividend was 5 cents a share, fully franked, taking the FY26 total to 10 cents. Management has indicated that a one-off final tax payment for FY26 is expected to fall in FY27, which will affect cash in that year.

The latest quarter

On 5 October 2026 Capricorn released its September quarter update. That compares with 30,437 ounces in the June quarter.

Guidance and the cost trade-off

FY27 guidance is 137,000 to 147,000 ounces at an AISC of $1,900 to $2,100 an ounce. At the midpoint of 142,000 ounces, that is roughly 15% more gold than FY26. The unit cost range, however, sits well above the $1,629 an ounce achieved in FY26.

Guidance is the company's own forecast, not a certainty.

Mt Gibson and the next growth step

Mt Gibson is the longer-term story. Capricorn has said the Federal Government has approved the project, and key state-level environmental documents have been lodged, with final permitting pending. Site development has been targeted for the December 2026 quarter, subject to approvals.

Mt Gibson would diversify the company beyond a single mine, but it will also Demand substantial capital.

Sector conditions and competitive position

Gold producers have benefited from a encouraging bullion price, illustrated by the $6,241 average realised price in FY26. Capricorn's strengths include a long-life mine, a net cash Balance Sheet and a record of delivering projects on time. That record is supported by the KEP finishing on schedule.

It faces the usual Western Australian pressures: competition for labour, contractors and equipment, and sector cost inflation. At around 150,000 ounces a year it is smaller than the major gold miners.

On index membership, Capricorn appears in a current ASX 200 constituent listing and was not named in the September 2026 quarterly rebalance changes, but this has been derived rather than confirmed directly by the index provider.

Key risks and uncertainties

• Gold price: a fall in the bullion price would cut revenue directly, and Capricorn's FY26 results were helped by a very high average price.

• Single-asset exposure: Karlawinda generates essentially all production, so operational disruption would have an outsized effect.

• Ramp-up risk: the expanded plant is new, and sustained throughput and recovery at 6.5 million tonnes a year are yet to be demonstrated over a full year.

• Rising costs: guided AISC for FY27 is materially higher than FY26.

• Permitting and capital: Mt Gibson depends on state approvals and will need significant investment.

What to watch

Upcoming events include the December 2026 quarter report, which should show the first full quarter with the expanded plant, and any state approval for Mt Gibson. These should show whether the larger plant is tracking the 137,000 to 147,000 ounce guidance and the cost range.

The expansion is a clear milestone. Whether it translates into lasting Shareholder value depends on execution, costs and the gold price, all of which can change.