Market, analysts not too concerned by disruptions at Northern Star’s Jundee and South Kalgoorlie operations

A 20,000-ounce hit to second-quarter gold sales from disruptions this month at the Jundee and South Kalgoorlie operations is not likely to significantly affect Northern Star Resources’ ability to meet current financial year guidance, analysts say.

Northern Star told the market of the stumble when releasing its September quarter results to the market on Thursday, saying the affected volumes were scheduled for processing during the remainder of FY26.

The company said the problem at Jundee was a localised structural failure in the crushing circuit, with the conveyor being reconfigured to the SAG mill, enabling operations to resume within two weeks.

At the same time, it reported a wall slip in the historic open pit at South Kalgoorlie, temporarily affecting infrastructure for the underground mine.

The company said the main portal to the underground operations remained unaffected and a return to normal stope mining was expected during this quarter.

Northern Star maintained full-year guidance of between 1.7 million ounces and 1.85Moz of gold at an all-in sustaining cost of $2300/oz-$2700/oz.

The market was unconcerned in early trade on Thursday, with shares rising 59.5¢, or 2.5 per cent, to $24.15.5 at 11am.

Market analysts Barrenjoey in a research note said the 20,000oz impact was small in the context of guidance and market expectations.

“Not huge within context of 1.70-1.85Moz guidance and market is already at the lower end, with Barrenjoey at 1.74Moz and consensus at 1.75Moz — so might not lead to big changes today to consensus,” it said.

Jeffries said despite the “softened” near-term outlook, “we remain focused on the medium/longer-term value proposition with 20 per cent gold sold growth by FY30”.

RBC Capital Markets said the disruption might see Northern Star track poorly versus guidance until third-quarter reporting in April.

Northern Star said it sold 381,000oz at an all-in sustaining cost of $2522/oz in the September quarter, with analysts saying the cost result was better than expectation.

The company’s latest production and cost performance compared with 444,000oz at an AISC of $2197/oz in the June quarter, 385,000oz at $2246/oz in March, 410,000oz at $2128/oz in last December’s quarter, and 394,000oz at $2082/oz in the corresponding September quarter last year.

Northern Star managing director Stuart Tonkin said the quarter delivered a mixed performance.

“Our Kalgoorlie production centre performed well, led by KCGM, where we maintained elevated production and development rates,” he said.

“Overall, costs for the quarter were better than forecast, reflecting our continued focus on capital discipline.

“The KCGM mill expansion remains on track for early FY27 commissioning.

“This week, we received ministerial approval for the Fimiston South project and associated infrastructure, which supports higher future throughput and long-term cost efficiency at KCGM to deliver sustainable high-margin ounces.

“We remain well positioned to deliver our full-year guidance, with stronger grades expected at KCGM in the second half, along with improved volume and grade performance across the broader portfolio.”