Aurelia Metals (ASX:AMI) used its FY2026 first-half earnings call to highlight higher revenue and profit, rising cash generation and ongoing progress at its key growth projects, including the Federation Mine ramp-up, the Great Cobar development and an expansion of the Peak processing facility.
Financial performance and mix
Chief Financial Officer Martin Cummings said first-half revenue rose 27% versus the prior corresponding period (H1 FY2025), driven by a combination of strong production performance and higher commodity prices. He noted that zinc volumes and revenue increased as Federation ramped up, but gold remained the dominant revenue contributor, accounting for about 53% of revenue, with silver adding about 2%.
Depreciation was slightly higher in the half, which Cummings attributed to depreciation beginning at Federation. He said Federation depreciation is largely on a units-of-production basis and is expected to rise as volumes ramp.
Cash flow, growth spend, and refinancing update
Cummings pointed to operating cash flow from the Cobar region of AUD 51.2 million for the six months, up 37% on the prior period. He emphasized that figure includes all sustaining capital for both Peak and Federation, describing it as cash generation “before growth capital.”
Growth capital spend totaled AUD 21.4 million in the half, which Cummings expects to increase in the second half. Within that, plant expansion capital was AUD 4.3 million, with spending expected to rise as projects approach commissioning. Great Cobar spending was AUD 11.2 million in the first half, which Cummings said was largely in line with the FY2026 ranges previously provided.
He also said Aurelia finalized its tax return and made a final tax payment for FY2025 of AUD 12.2 million during the period.
On the balance sheet, Cummings discussed restricted cash tied to bonding requirements. At December, restricted cash was AUD 27.8 million, a figure he said has increased further due to amounts due in February. He said the company’s refinancing process is progressing well, with terms targeted to be agreed during the quarter and financial close expected either within the quarter or early in the next. The primary objective is an upsized performance bond facility, which would allow cash currently backing bonds to be returned to the balance sheet.
Operations: Federation ramp-up and Peak plant expansion
Managing Director and CEO Bryan Quinn said operations delivered strong metal production and project execution during the half, supported by strong commodity prices. He added that mills are operating near current nameplate capacity, and the company is focused on building stockpiles ahead of the mill over the coming months. Quinn also cited record recoveries for certain commodities achieved during the ramp-up of processed tonnes.
On Federation, Quinn said the mine is ramping up in line with plan and “a bit ahead” for the year, with grades encouraging and expected to improve month-by-month. He said gold grades have been “slightly better” and that increases between the first and second quarters aligned with prior guidance that grades should improve as mining advances deeper into more substantial ore zones. The company continues to advance the decline, conduct infill drilling to improve stope design confidence, and drill the Federation West deposit from underground.
For the Peak processing facility expansion, Quinn reiterated the staged plan to move from 800,000 tonnes per year nameplate capacity to 1.1 million to 1.2 million tonnes. He said tailings and process water management is targeted for completion in Q4 FY2026, with a tertiary ball mill to be installed and commissioned in Q1 FY2027. Quinn said the expansion is being self-funded and described the capital as “very reasonable” given the expected upside. He also said Aurelia repurposed a ball mill and substation from Dargues, with the substation already placed on steel trestles and electrical work expected to commence soon.
Great Cobar, resources and exploration pipeline
Quinn said development at the Great Cobar Project is on schedule, along with surface infrastructure works that are preparing for shaft sinking later in the calendar year. He added that the investment case is “materially higher at the current prices” than when presented to the market previously, and encouraged investors to reflect updated pricing in their models. He said the orebody remains open at depth and in multiple directions, and the company plans to infill drill and test below the current known resource as access develops.
Across the portfolio, Quinn highlighted a mineral resources and ore reserves update completed in H1 FY2026, with total mineral resources of 29 million tonnes up 12% and ore reserves up 17%. He said the increases reflect the work of Aurelia’s exploration teams and the company’s ability to convert discovery into development opportunities.
Quinn also described the Nymagee opportunity as a potential future catalyst for organic copper growth. He said drilling is continuing through the calendar year to grow and better understand the resource, noting the area’s proximity to the Hera plant (within 5 kilometers) and existing infrastructure, sealed-road access, and the potential suitability of ore for either the Hera or Peak plants.
Other items: safety focus, accounting questions, and Hera options
Quinn said the company experienced several slip-trip hand injuries during the half and responded by introducing behavioral-based safety programs and tightening induction and training, with a stated goal of ensuring workers “go home safely at the end of every day.”
During Q&A, management addressed several financial and operational topics, including:
- Financing costs: Management said the difference between the AUD 9.1 million financing cost and the AUD 2.7 million expense related mainly to rehabilitation unwind and amortization of borrowing costs from prior periods.
- Depreciation outlook: Cummings said first-half depreciation included about AUD 15 million from Peak and just under AUD 8 million from Federation, plus corporate. He guided to around AUD 20 million of Federation depreciation for the full year and group depreciation of roughly AUD 50 million to AUD 55 million for FY2026, stepping higher in FY2027 as Federation volumes rise.
- Tax position: Cummings said Aurelia is now a taxpayer, having exhausted prior tax shields, including loss carryback benefits used in earlier periods.
- Hera restart considerations: Quinn said decisions on potentially using Hera depend on ore source and optimal configuration across Peak, Federation and regional deposits. He noted prior commentary of AUD 20 million to AUD 30 million to restart Hera, but said those figures would need reassessment and should not be relied upon without considering ore type and required plant configuration.
Quinn closed by saying Aurelia is building toward its stated strategy of reaching 40,000 copper-equivalent tonnes by FY2028, supported by sequential delivery, operating systems, self-funded growth and continued exploration to build future options.
About Aurelia Metals (ASX:AMI)
Aurelia Metals Limited engages in the exploration and development of mineral properties in Australia. The company primarily produces gold, silver, copper, lead, and zinc. It holds interests in the Peak Mine situated in the northern part of the Cobar Basin, New South Wales; and the Dargues mine located in southern Tablelands in New South Wales. The company was formerly known as YTC Resources Limited and changed its name to Aurelia Metals Limited in June 2014. Aurelia Metals Limited was incorporated in 2004 and is headquartered in Brisbane, Australia.
