Key Highlights

• Ounces sold were 16,366 at an average realised price of A$6,293 per ounce.

• AISC of A$2,800 to A$3,400 per ounce compares with A$4,107 in the June quarter.

• Cash and gold of A$223.4 million at 30 June 2026 gives the company considerable flexibility to fund development and exploration.

• Figures below are for the quarter to 30 June 2026 and come from coverage on 30 July 2026 of the company's quarterly report.

Why would a gold producer realising encouraging gold prices still talk about operational headwinds? Pantoro Gold (ASX:PNR), which owns 100% of the Norseman Gold Project in Western Australia, reported June 2026 quarter production of 18,028 ounces at an All-In Sustaining Cost (AISC) of A$4,107 per ounce, then guided to FY27 production of 90,000 to 105,000 ounces at AISC of A$2,800 to A$3,400 per ounce. The distance between those two cost figures is the central issue for investors, and the answer lies in underground Mining performance, a contractor change and the sequencing of new mining areas.

Pantoro is a gold producer, so its Earnings are driven by the gold price in Australian dollars, ounces sold and unit costs.

The June 2026 quarter

Figures below are for the quarter to 30 June 2026 and come from coverage on 30 July 2026 of the company's quarterly report. Gold production was 18,028 ounces. Ounces sold were 16,366 at an average realised price of A$6,293 per ounce. AISC was A$4,107 per ounce. EBITDA was A$44.8 million, and cash and gold on hand were A$223.4 million. The company also bought back 3,139,535 shares at an average price of A$3.26.

At a realised price of A$6,293 and an AISC of A$4,107, the gross Margin per ounce sold was about A$2,186 before items not included in AISC, such as growth capital, tax and interest. The margin shows how much earnings depend on the gold price. If the realised price fell, a high-cost quarter like June would see margins compress quickly.

Why costs were high and what changes

Management acknowledged operational headwinds during the quarter. At the OK Underground mine, the mining contractor changed in May 2026, and development and production rates improved in later months. Underground personnel levels were expected to be rebuilt by the end of September 2026. A contractor change is disruptive, and productivity typically takes time to recover. Whether the improvement continues is the main operational uncertainty.

Guidance for FY27 implies a large fall in unit costs. AISC of A$2,800 to A$3,400 per ounce compares with A$4,107 in the June quarter. Part of that reduction should come from higher production spreading fixed costs over more ounces, and part from mining higher-grade or more accessible ore. At the guided production range of 90,000 to 105,000 ounces, the quarterly run-rate would be 22,500 to 26,250 ounces, well above the 18,028 ounces produced in the June quarter. Reaching that rate is the test. These are forecasts, not results, and they depend on mining rates, grades, labour availability and the gold price.

Growth projects at Norseman

The company is pursuing several sources of ore. The Green Lantern open pit was scheduled to start mining in late August 2026. Open pit mining generally has lower unit costs than underground mining and can add flexibility to the mill feed. Development is underway at Mainfield, Phoenix and O'Briens Lode.

Exploration continues. Drilling identified a high-grade zone called Racetrack about 600 metres north of OK Underground, and a major exploration program at Lake Cowan has started after Aboriginal heritage surveys were completed. Exploration results are not reserves, and early drilling success does not guarantee economic mining. Management's long-term goal is to scale annual output toward 200,000 ounces, well above the FY27 guidance range, which is an aspiration rather than a plan with a committed date.

Balance sheet and Capital management

Cash and gold of A$223.4 million at 30 June 2026 gives the company considerable flexibility to fund development and exploration.

Sector and competitive position

Australian gold producers have benefited from gold prices in Australian dollars well above recent historical levels, but they face rising costs for labour, energy and contractors. Norseman is a long-lived field with a processing plant, which is an advantage over explorers that must build infrastructure, but mid-tier producers are exposed to single-asset risk.

Material risks

- Operational execution: contractor transition, labour availability and mining rates at OK Underground.

- Cost inflation, including labour and energy.

- Gold price volatility, since costs are largely fixed in the short term.

- Single-asset concentration at Norseman.

- Grade and reconciliation risk between resource models and actual production.

- Exploration risk and permitting or heritage approvals.

- Guidance risk: FY27 guidance requires a sharp step up in output and a sharp fall in costs.

What to monitor

Other items include the start and performance of Green Lantern, underground personnel levels, exploration results at Racetrack and Lake Cowan, the cash balance and buyback activity, and any update to mineral resources and reserves.