ASX gold producer Regis is cashed up, but costs are rising

It was a mixed quarter for Regis Resources (RRL), which lost out on its bid for Vault Minerals (VAU) to Genesis Minerals (GMD), but posted gold production in line with analyst forecasts and sales volumes 8% ahead of consensus. The company also had a record $1.18 billion in cash and bullion on its books, a massive increase of $667 million over the financial year, demonstrating how the company took advantage of the soaring gold price.

Jim Beyer, managing director and CEO, said: “The June quarter capped off a very strong year for Regis, with both Duketon and Tropicana finishing FY26 well. Group gold production of 101.5koz for the quarter lifted full year production to 379koz, the top end of our guidance range.”

Despite the robust results the share price was trading down over 6% in afternoon trading.

Results vs estimates

RRL’s Q4 numbers against analyst expectations:

• Gold production flat at 101.5koz vs 101.5koz ests (in line, pre-reported)

  • Duketon 62.5koz vs 62.5koz ests (in line)

  • Tropicana 39.1koz vs 39.1koz ests (in line)

• Gold sales up to 102.4koz vs 94.5koz ests (8% beat)

• AISC of A$3,244/oz vs A$3,120/oz ests (4% miss)

  • Duketon A$3,642/oz vs A$3,558/oz ests (2% miss)

  • Tropicana A$2,532/oz vs A$2,563/oz ests (1% beat)

• Realised price A$6,241/oz vs A$6,574/oz ests (5% miss)

Production landed in line as pre-reported, lifting full year output to 379koz at the top of the 350-380koz guidance range. Sales beat on volume, though the realised price came in below expectations, and group all-in sustaining costs (AISC) missed on higher Duketon costs. The cost overrun was driven by higher diesel prices and non-cash stockpile charges.

Management also clarified why it chose not to increase its bid for VAU during the quarter, because “it did not meet the value and return thresholds” it applies to growth opportunities. While being disappointed, the company is now focused on organic growth with projects like McPhillamys which is at study stage.

FY27 forecast

• Group production of 360-400koz, up from 379koz in FY26 

  • Duketon 240-270koz

  • Tropicana 120-130koz

• Group AISC of $2,990-3,390/oz, including about $88/oz of non-cash stockpile movements 

  • Duketon $3,100-3,550/oz

  • Tropicana $2,630-2,950/oz

• Growth capital of $250-270 million

  • Duketon $235-245 million

  • Tropicana $15-25 million

• Exploration of $80-90 million

• McPhillamys of $30-35 million

Regis reaffirmed the FY27 guidance it released last week, guiding to higher group production of 360-400koz, up from 379koz in FY26. Duketon is guided to lift production 10% year-on-year while Tropicana eases.

FY27 group AISC is guided higher at A$2,990-3,390/oz, including about $88/oz of non-cash stockpile movements. That reflects a weaker Tropicana grade mix and a higher diesel price assumption.

Looking ahead for Regis

Rising costs are a theme for gold producers, with higher diesel prices likely to lift all-in sustaining costs industry-wide. For Regis the pressure is compounded from two directions. Duketon will be mining higher-cost ounces going forward as cheaper ounces tend to get mined first while the weaker grade mix at Tropicana means more rock must be mined and milled to yield the same output.

In a recent research note, Bell Porter pushed its guidance ~13% above their earlier forecast for AISC, now seeing FY27 AISC near A$3,080/oz. Canaccord Genuity separately lands in similar territory, raising its FY27 production forecast to 380koz at AISC of A$3,173/oz, a 10% lift on its earlier estimate. 

The other pressure is capital expenditure, the money RRL spends building and extending its mines rather than the day-to-day cost of running them. This spending sits outside AISC, so it does not lift the headline cost per ounce, but it does draw on cash. 

Bell Potter reads it as strategic rather than a warning sign, tied to RRL's decision to develop and mine more marginal but still profitable ounces, a move it says increases leverage to the gold price. While, Canaccord Genuity lifted its FY27 growth capex forecast sharply to catch up with the guidance. Even so, it frames the spend as affordable, noting that while the heavier investment cuts its free cash flow estimate, the remaining cash flow still represents a healthy yield that comfortably covers the dividend. 

The brokers trimmed their price targets after RRL announced its FY27 figures last week, due to the higher costs and the capital spend. Bell Potter rates RRL as a buy with a $8.45 target, while Canaccord is also buy rated, but with a more modest $6.70 target.

Investors should look out for the company’s full year results on August 26, 2026 to see signs of a more robust balance sheet.