NST +6.21%: produced another strong year of earnings growth as elevated gold prices flowed through to the bottom line, with the share price move today helped by a solid uptick in bullion prices overnight. Revenue was bang in line with consensus, but FY27 will be less about the gold price and more about execution at the new processing plant.
Key results:
- Revenue of A$7.62bn, up 19% and in line with consensus.
- Earnings (EBITDA) of A$4.09bn, up 21%.
- Underlying profit of A$1.79bn, up 26%.
- Statutory NPAT of A$1.66bn, up 24%.
- Final dividend of 30cps.
FY27 gold sales are guided to 1.55–1.65Moz, with AISC of A$3,050–3,450/oz. However, investors need to be prepared for a softer start: September-quarter production is expected to be around 350koz due to planned shutdowns and the commissioning of KCGM’s expanded 27Mtpa processing facility. Production will therefore be skewed toward 2H27. Growth capex also remains substantial at A$1.7–2.02bn, as NST invests heavily in expanding future output.
MM’s view: NST remains one of the highest-quality large-cap gold exposures on the ASX, but FY27 is an execution year rather than simply another year of enjoying a higher gold price. The expanded KCGM is the prize and should ultimately transform the production and cash-flow profile, but the combination of a second-half production skew and heavy capex creates scope for volatility if commissioning slips. We like the long-term setup, but with gold equities already pricing in a lot of commodity-price strength, NST now needs KCGM to deliver – operational execution is becoming just as important as where the gold price trades.
MM is bullish toward NST
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