Northern Star will continue to organically grow its assets during FY18. Image: Northern Star Resources.
BY CAMERON DRUMMOND
GOLD producer Northern Star Resources has flagged an annual spend of $100m for exploration and expansion in FY18 after posting record financial year results.
The WA-based miner’s profit after tax rose 42 per cent from FY16 to $215.3m, which included a $26.4m profit from the sale of its Plutonic mine.
The result came after Northern Star invested a whopping $130m to increase overall gold production to 600,000 ounces per annum (ozpa) in 2018.
The company also posted record earnings before interest, tax, depreciation and amortisation (EBITDA) of $461.3m, up 16 per cent from the previous corresponding period; as well as an overall revenue of $883.8m, in line with FY16 figures.
It also upped its final dividend payout 50 per cent to 6 cents per share, for a total FY17 payout of 9 cents per share.
Northern Star managing director Bill Beament said the results reflected an outstanding year for company where it had again met or exceeded guidance figures and generated significant cashflow.
“A 42 per cent increase in net profit is exceptional in any circumstances,” Mr Beament said.
“But this result is particularly satisfying because it has been driven predominantly by organic growth.
“Moreover, the lucrative benefits of this strategy are still unfolding, with further production increases forecast for this year and beyond.
“The ongoing production growth is underpinned by the substantial increase in our inventory which has resulted from the organic growth strategy.”
Mr Beament said Northern Star had budgeted $100m for exploration and expansionary capital in FY18 as a continuation of that strategy.
“We have substantial exploration upside and organic growth at all our operations,” he said.
“But with the recent growth in our inventory, we will seek to unlock this potential which will require reduced expenditure from last years.”