Like many of its rivals, gold miner Northern Star (ASX:NST) saw a strong end to the June financial year as record gold prices caused revenue to surge, aided by a weak Aussie dollar.
Every other miner with ounces in the market has experienced a golden tinge thanks to the combination of record prices for the yellow metal in both US and Australian dollars.
This record performance has continued into July, providing a solid start to the new quarter, half-year, or financial year.
As a result, some miners have reported significant boosts to cash flows, increased cash on hand, the ability to pay down debt, or have made expansion plans appear more profitable.
For miners in the midst of major expansions, like Northern Star, the positive outlook has made the original decisions less risky and has helped management feel more comfortable with their choices.
On Thursday, Northern Star reported a substantial increase in its cash earnings for the year ending in June, thanks to the surge in prices, the weak dollar, a solid production effort—especially from its previously troubled Pogo mine in Alaska—and tight cost controls.
The company estimates its annual cash earnings for 2023-24 will be between $1.78 billion and $1.82 billion, nearly 50% above the $1.233 billion reported for 2022-23.
The second-half surge is evident from the figures provided by the company on Thursday. First-half cash earnings were $702 million, but Northern Star expects second-half cash earnings to be between $1.078 billion and $1.118 billion.
Northern Star ended the quarter with a net cash position of $359 million, including cash and bullion worth $1.25 billion.
This was after underlying free cash flow for the year ending June 30 jumped to $462 million, up from $359 million in 2022-23.
The June quarter alone saw underlying free cash flow of $189 million.
Additionally, the company's $300 million on-market share buyback is 57% complete, with $172 million paid to date.
Northern Star met its 2023-24 sales and cost guidance, selling 1.621 million ounces of gold at an all-in sustaining cost (AISC) of A$1,853 per ounce.
With major growth projects, led by the substantial KCGM Mill Expansion, ongoing, all-in costs (AIC) were reported at A$2,750 per ounce.
In the June quarter, the ASX 200 miner sold a total of 439,000 ounces of gold at an AISC of A$1,815 per ounce (US$1,196 per ounce).
The company was clearly pleased with the success of its Pogo gold mine in Alaska, which achieved a record quarterly gold sale of 91,000 ounces in the three months to June, for an annualized rate of 363,000 ounces, and a record net mine cash flow.
CEO Stuart Tonkin is confident about the outlook: "We have entered FY 2025 with positive momentum as we progress the KCGM Mill Expansion Project, execute on Yandal's hub strategy to lower its cost base, and continue Pogo's excellent performance.
"We are well into our five-year profitable growth strategy, which aims to increase our production to two million ounces by FY 2026, and, more importantly, deliver higher free cash flow levels."
