Gold prices steady ahead of Fed decision; weekly weakness noted
Aeris Resources Ltd (AIS), with a market capitalization of $11.71 million, reported its first-quarter 2025 earnings, highlighting a robust increase in copper production and strategic developments across its mining projects. Despite these advancements, the company’s stock experienced a 7.5% drop, reflecting broader market concerns. According to InvestingPro data, the stock has shown significant volatility, posting a 10.9% return over the past week despite recent market turbulence.
Key Takeaways
- Aeris Resources’ copper equivalent production reached 10,700 tons this quarter.
- Operational cash flow for the quarter stood at $45 million.
- The company is focusing on expanding its Triton Mine and Constellation Deposit operations.
- Aeris plans to divest its North Queensland assets.
- The stock price fell by 7.5% post-earnings announcement.
Company Performance
Aeris Resources showcased a strong performance with a quarterly copper equivalent production of 10,700 tons. The company is leveraging its gold assets to develop its copper operations, aligning with its strategic focus on long-term growth and sustainability. The Triton Mine and Constellation Deposit are central to this strategy, with significant resource upgrades and potential for increased production.
Financial Highlights
- Quarterly copper equivalent production: 10,700 tons
- Operational cash flow: $45 million
- Year-to-date operating cash generated: $135 million
- Cash and receivables: $33.6 million
Outlook & Guidance
Aeris Resources maintains its copper equivalent guidance of 40,000 to 48,000 tons for fiscal year 2025. The Constellation Pit is expected to operate for 15 months, with mining potentially starting in 2026 pending environmental approvals anticipated by November. The company is also in the process of refinancing its debt facilities.
Executive Commentary
Andre, a company executive, emphasized the strategic importance of the Triton Mine, stating, "We see this as a sort of a game changer for us. If we can have five to six years of baseload at high grades open pit mining, it will really trigger a significant uplift for the business." He also highlighted the role of gold assets in funding copper development, saying, "The cash we generate from the gold assets is how we develop the copper assets."
Risks and Challenges
- Fluctuating gold prices could impact financial stability.
- Environmental approvals for new projects may face delays.
- The divestment of North Queensland assets could affect operational focus.
- The feasibility of ongoing projects like Jaguar and Stockman remains uncertain.
- Market conditions and commodity prices pose ongoing risks.
Aeris Resources is navigating a complex landscape with strategic initiatives aimed at bolstering its copper production capabilities. While market reactions have been mixed, the company’s focus on leveraging its gold assets for copper development remains a key driver for its future growth. Trading between its 52-week range of $17.49 to $26.78, the stock shows promising potential despite its volatility. For deeper insights into AIS’s valuation and growth prospects, including 8 additional key ProTips and comprehensive financial analysis, explore InvestingPro’s detailed research report.
Full transcript - Aeris Resources Ltd (AIS) Q3 2025:
Andre, Company Executive/Presenter: Has got most of you on the call will know the company has got the three assets. It’s got Triton, Krakow, and had the Mount Collin mine, which is now in care and maintenance. And my the main asset, of course, is Triton currently forecasting around 21 to 25,000 tons of copper with gold on top of that and Krakow between forty and forty nine. We’ll talk about each one of these individually as we go through, and then the three projects in the portfolio is the Barbara project, the Jaguar operations, and Stockman. When you go to the next slide, we’ll see the last quarter quarter on quarter, copper equivalent production is up to 10,700 tons.
But that is mainly on the back of higher production from Chutten and Mount Colin and then offset a little by lower production from from Krakow, but that that was planned. The cost of our managers come down at a group level to $4.91 per copper equivalent per pound. And then cash to receivables, you know, the quarter is slightly up at 33.6. But that to be very clear, in that number, on top of that, we actually put $14,000,000 additional funding into cash back bonding. So that number would have been significantly higher if it wasn’t for requirement to put $10,000,000 specific into the ANZAC facility to get an extension.
At the operational cash flow level, a significant increase quarter on quarter to $45,000,000 for the for the quarter. You’ll see in slides coming up. It was mainly driven by Triton, and that’s just the nature of the Triton mine and the sale of concentrate and timing of cash. So there was cash coming in more concentrate sold during the quarter, but the year to date numbers will be accurate, although, you know, cash the the movements of working capital quarter on quarter, but a good outcome for the operations at that level. The safety, as always, has been well managed.
No lost time injuries for the quarter. You would have seen there’s a minor environmental incident due to heavy rains at Krakow. At Krakow, look, everyone knows the gold price is is making a big big difference. Lower on on production for the quarter, where that was planned, we mined lower grade stopes on the quarter, but still for the financial year in quarter four, we’ll see a improvement again for Krakow. At Triton, they add 4,300 tons of copper at all in selling cost of $6.16.
It’s better than the last quarter, but we are looking at quite a big quarter in quarter four where the open pit now as of this last week is actually mining the and keeping the mill full at the annual run rate about 1,800,000 tons. So we’re expecting a very good quarter four on the back of those mined tons, and then we’ll talk talk more about it. At Mount Colin, Mount Colin is now finished, so we ended up with 5,500 tons of copper for FY ’24. We’re slightly below guidance. But then again, on the gold side, there was significantly more gold in the ore, and the gold ended up at the top end of guidance.
But what we’re now doing with Mount Colin, it’s in care and maintenance, and we’ll talk a bit more about how we’re progressing on those. The rest with the feasibility studies for Jaggers and Stockman is continuing. And as you would have seen in this last few weeks, we’ve announced the Consolation mineral resource estimate update. That was a significant change. And to us, it’s a significant change in the way we look at the business over the next three to four years, and and we’ll we’ll get into the details of that.
If you move on to the cash flows, the cash flows, as you can see there, significant operating cash flows from Triton, good cash flows from Krakow, the last bits coming out of Mount Colin. And then, obviously, we spent quite a bit of it on capital. One of the big outflows, of course, as I said earlier, was that restricted cash of another $14,000,000, of which then was put into ANZ for the extension of the ANZ facility while we’re working on refinancing that facility. Ended up the cash more or less where where it was in the in the last quarter. The year to date numbers, know, there’s hundred and $35,000,000 of operating cash generated between the operations, quite a bit of money getting back into capital.
We are now putting significant capital dollars into the Marowambi pit. This that has kicked off in February, and we can see those capital costs coming through. And and and significant money as we move forward will be spent, but that that put will generate significant cash for us over the next twelve to eighteen months. The look at Triton, the performance for Triton, as you can see, quarter on quarter, it’s better. The grade is is definitely better grades being mined.
We can see the impact of a Volker tank in that quarter, and we also see the impact of pulling out of the Marwambi underground mine, which were low grade tons. So it it is basically a higher grade quarter for us and and an improvement on in production and costs for for Triton. The we’ve been talking quite a lot about over the last six months about the improvement projects to improve productivity, improve the mining sequence, improve development. And the last quarter, we’ve seen a significant uplift in both in in development rights with achieving rights we haven’t achieved for many, many years. Now that the backfall is up and running for budget, although there was a delay in that backfall because of OEM break breakdowns at startup, We’re now doing significant amount of paste, and that’s all.
And the drilling the the diamond drilling is all the things you need to do to advance and get that consistent production from the underground mines. And we can see that now flowing through, especially in the last month or so. But I won’t be open pit. That has commenced. There was a slight delay in start up because the contractor was struggling to get qualified labor.
It is now in place. And, basically, in May month, they will mine all the ore which will be processed between May and June. So within the next few weeks, we’ll have significant stockpiles of ore which will be processed through the plant, and we see May and June will be run at at full capacity of over 50,000 tons a month. What we also seen with the Marowambi pit, we we originally talked about 1,300,000 tons at 1.3%. We’re now seeing that potential for those tons to go to 1.7, one point eight million tons at slightly lower grades because there is quite an opportunity on the lower grade side.
So there you can see the the the pit stage one is is basically taking a the the the ore available in a short space, and then we’ll do the the cutback. So that’s all going really well. But one of the big benefits, of course, we talked about a lot, you can already see the work which has been done on the old heap leach pads in that photo on the right hand side where they are where we’re starting to cap them with the waste from the pit. Now that has all been part of the environmental closure plan. That will save us about $8,000,000 environmental closure costs because as we finish the model won’t be put, those heap leach pads will be covered, and we can finish off the rehabilitation of those those old heap leach pads.
The key opportunity which we’ve announced in the last few weeks was the Constellation deposit. We’ve updated the mineral resource. We’ve done a quite a large drill campaign. The resource is now 7,600,000 tons at 2% copper and point six six gold. And as you can see, the 50,000 tons of copper and a 61,000 ounces of gold.
I don’t think we always realize the value of that gold in these deposits, and we’ll talk a bit more when we talk at the open cut mining as an example. So we see significant increases in both contained copper and and gold, and and the real upside for us is that open pit resource has increased by 46%. So there’s now 4,700,000 tons. And what that means is, originally, we our view about this was it’s a small open pit, and then you go underground, and the new resource update has shown that you can actually have a quite a large open pit. It means if you mine eight to 800 to a million tons annually from this open pit mine.
You got a open pit mine running for three or four years. And then you add on the current open pit for Marowambi, which will run fifteen to eighteen months in itself. So you you will have a six year period where you will have a good baseload feed to the Triton mill from from these mines. And if you go look to the next slide, the specific interventions we’re focusing on, there’s gonna be a three stage approach to this. There will be a the oxide literally starts five meters below surface.
There’s an opportunity for a heap leach of one and a half million tons, which will be a pretty fast process. But the main opportunity, the way I look at it, is you look at that supergene and primary ore in the pit. That starts around 50 meters below surface. There’s 3,200,000 tons. Now if you say you mine 800 to a million tons, it’s anything between three and four years of open pit mining at grades of two and a half percent.
That is that is where we bring Triton to a 30,000 ton producer with consolation and and a tanker as part of the feed. And then you get underground. It’s still open at depth. There’s already 2,900,000 tons around 2%, plus 2.2%. So for for for for us, we can see this mine being used in the Triton processing plant and and projects for close to ten years, and we know it’s open at depth, and it should continue as we move forward.
So we quite we see this as as a sort of a game changer for us. If we can have five to six years of baseload at high grades open pit mining, it will really trigger a significant uplift for the business. On the development plan, so we the EIS is large. We’re doing a feasibility study to turn the indicated reserve into an yeah. Indicated resource to a reserve, and then we will start to look at how do we bring basically, trying to do you finish off the Marowambi pit and go straight into Constellation, but with the same contractor is is the timeline we’re working on for the start of of Constellation development.
If you look at Krakow, Krakow, once again, slightly lower quarter. They had two really good quarters, but a lot of the the production for this quarter was planned because there were some lower grade stopes, which was always in the in the plan, which has come out. We had a bit of production losses due to the cyclone not impacted by rain, but more impacted by people who couldn’t get to to the mine or couldn’t get to work when we lost a few production shifts from that. Not material, but it it did it did make a difference. The one of the projects we’re working on to improve the recoveries is a a cyclone project, so that is busy being commissioned, and that should give us 1% increase in in in recoveries as we move forward.
So for us, really, Krakow generates good cash. It is, as we said now multiple times, the cash we generate from the gold assets is how we develop the copper assets, and and that will help to fund the startup of the Morrowind. But it also will look at how do we fast track and progress on the constellation mining plans. Then you move on to Mount Colin. As I said earlier, Mount Colin is now finished.
As you can see there, we produced 5,500 tons. It’s slightly below guidance of six to seven, but on the gold side, we produced more gold than what we estimated. So it won’t offset the other. What the plans are now, the we’ve basically relocated all the buildings and infrastructure off-site. We’re busy looking at the rehabilitation plans, and and we’ll kick that off.
But, also, as part of the bigger picture, we have decided to divest our North Queensland assets, the Barbara deposit and all the tenements surrounding it, and we’re running a formal process. It’s all part of focusing the capital where there’s better returns, but also on projects with a longer life as we move forward in the business. The on the Jaguar deposit, nothing more to report on the quarterly, really, other than we have done a lot of work on ventilation and a geotechnical reviews, ground control at the restart of the Bentley mine or the Toba deposit. That work has now resulted in a new mine plan, and we’re now looking at that mine plan specifically around power supply and distribution network across the business. So that work is still underway, and we are also doing quite a bit of work on both base metal and gold exploration opportunities.
As we said previously, it is got gold tenements and gold targets very close to other gold miners in the region. So the work is ongoing for for JAG. The production plans are being pulled together based on ground control and and ventilation. At Stockman, Albion process, the test work is is is literally underway, as I said before, trying to finish off what’s a cost and capital associated with those. And once we finish that off, we will update the feasibility study with results from the Albion process test work.
At a group level, at a corporate, as we talked before, 33.6 cash and receivables. Receivables is basically Triton Concentrate, which hasn’t been sold. We’ve put another $10,000,000 into cash backing against the facility that would have put the cash receivables at 43 if we didn’t do that. And the restricted cash now sits at 28.9. Now that restricted cash is all cash backed bonding facilities on top of the the A and Z facility currently in place.
Moving on to the the the debt side, so I’ll just touch on that quickly. We are in the process of finalizing the debt refinancing with the replacing the AZ facility that is close to paying a position where we could talk about it. And, also, the current debt in place, as as you all know or might know, is the $40,000,000 on the Washington South Patterson facility. The so I think that sort of summarizes it as we sort of kicked off with two producing assets, three development projects. We really can see the value of exploration opportunities both at at Krakow and Triton, and we we still maintaining that copper equivalent guidance between forty and forty eight thousand tons, copper equivalent for FY ’25.
With that, I don’t know if there’s any questions. Happy to take. If you wanna put your hand up, we can open it up. Or if you got a question and you wanna put it in the in the the q and a, we will answer those questions. So they said someone will ask, can you please provide further details on Isaac facilitated to pay 10,000,000 in fees?
No. It’s not 10,000,000 in fees. It was just an offset on the cash backing facility. So the facility was 50. We put in 10,000,000 to offset against that, so it’s basically turned into a $40,000,000 guarantee facility.
So that 10,000,000 is now cash backed against bonds.
Stefan/Adam, Investor/Analyst: Andre, we have questions from David Coates and Volcano.
Andre, Company Executive/Presenter: Yep. Can you open them up?
Paul, Analyst: Paul. Andre?
Andre, Company Executive/Presenter: Hey, Paul. How are you doing?
Paul, Analyst: Good, mate. Hopefully, you can hear me alright.
Andre, Company Executive/Presenter: Yeah. I can.
Paul, Analyst: Yeah. Just first one quickly on on Triton. I see you sort of kept guidance unchanged there, which would suggest around sort of 8,000 tonnes of copper to be produced in the in the last quarter. I guess throughput will increase with the addition of Murrawambi, but should we expect grades to to tick up as well in this this last quarter?
Andre, Company Executive/Presenter: Yeah. There’s a high grade zone coming out of the pit, and we’re also expecting higher grades coming from a bunker tank as part of the, you know, the volume mix coming more tons from a tanker tank. But there is a high grade zone in the pit where we’re currently mining, and those tons will will be on their own pad within the next three or four weeks.
Paul, Analyst: Yeah. That’s great. And and then, I guess, how should we think about the transition from sort of, I guess, the Maiwami Open Pit to the Constellation Pit? Just just rough timing on that.
Andre, Company Executive/Presenter: So the Constellation Pit will run for about fifteen months as of today, and we will basically, as the pit finishes up because when you get to the bottom, you know, you can’t keep all the trucks. Those those equipment will move straight over to conservation. So the one will start when the one finish up, the other one will start. So, basically, in our view, by mid next year is when you want to be into the consolation open pit mine.
Paul, Analyst: Yep. No. That’s that’s very clear. No. That’s all for me, Andre.
Thank you very much.
Andre, Company Executive/Presenter: Thanks, Paul. Stefan, would you open?
Stefan/Adam, Investor/Analyst: Hi, Andre. Can you hear me?
Andre, Company Executive/Presenter: Yes. Hi, Adam. How are doing?
Stefan/Adam, Investor/Analyst: Well, thank you. Just had a question on Muarabi historic heap leach pads and I guess the mechanics of of the bonding. You mentioned you saved about $8,000,000 environmental costs from the rehab of these. Just wondering if you can talk through when you’re expecting to receive that cash back and is that an annual readjustment or you know, a quarterly readjustment? Any sort of color you can add to that would be great.
Andre, Company Executive/Presenter: So, Adam, my understanding is that once we finished off the the the profiling with the waste and the closure of the pads, you then get someone in to assess it, and you can resubmit, basically post that. So within the next fifteen months or twelve months, we can resubmit our bonding and and and get some of that bonding reduction through the the government bonding scheme or or, you know, the the environmental bonds. So you need to prove that you’ve done the work, and then a reassessment will be done, and and then you can claim your bonds or a reduction in the bonds back.
Stefan/Adam, Investor/Analyst: Okay. That that’s helpful. And just just following on from that from the bonding, is there any further cash payments now that Mount Collin’s been transferred into care and maintenance moving forward?
Andre, Company Executive/Presenter: There’s on Mount Collin, you know, their bonding and the environmental cost is between 1 and a half and 2 and a half million dollars, so it’s not a significant amount. So what we need to do, we need to close the water dams and close the portal and do a bit of rehab, and then we can claim those a reduction of those bonds back. But it’s not significant in the bigger scheme of things.
Stefan/Adam, Investor/Analyst: Okay. Thank you, Andre.
Andre, Company Executive/Presenter: Thanks, Adam. There’s a few more questions. I don’t we don’t see in your hands. So we’ve got a question from Jason. I’m just reading the question.
The question is around hedging and and the cash flows from from Triton and then also just on the Washington saltpacks and facilities. So at this stage, Jason, we don’t have any hedges, and and there is a view currently that once we refinance the A and Z facility and the outcome of those, we might start to look at some gold hedging or hedging some of the gold, but it will all be dependable it depend where we are at the time. At this stage, we haven’t done any purely because we are working on the refinance options for the AZ facility. And and your question around the facilities outside, the we are working on those facilities. And as I said earlier, both the A and Z facility replacement for the bonding guarantee facility.
We’re working on that and and should come into the market shortly with an update on those. There’s currently none of these facilities requiring us to do compulsory edging, but we can do edging is is the answer. David Coates asking about permitting at Constellation. So, David, we’ve submitted the EIS. They we’re expecting that to we’re putting a few more amendments in with the road changes.
We’re expecting the approval of that towards November this year. And once we’ve got that, we can do the final mining lease, and that sort of take that where we can start mining in f y in in in calendar twenty six. But it’s it’s well underway and well in hand and being submitted. Stefan, I can’t see any more raised hands. I I don’t know if they are.
And No. If there’s if there’s no more questions from anyone, I think we’ll close off on the presentation. Thank you, everyone. Appreciate your attendance, and we’ll give you a further update when we’re ready on the refinancing. Thank you.
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