UPDATE: Northern Star Resources Ltd (ASX: NST) shares have crashed by 10% this morning, trading at $23.99 as the gold miner faces a significant operational setback. The alarming decline follows the release of a disappointing operational update detailing underwhelming gold sales for the December quarter.
The announcement reveals that total gold sales for the quarter reached just 348,000 ounces, falling short of expectations and leading to a revised annual production forecast. Northern Star now expects to produce between 1.6 million ounces and 1.7 million ounces for FY 2026, down from previous estimates of 1.7 million ounces to 1.85 million ounces.
This operational decline is attributed to a series of isolated negative events that hit the company’s production capabilities late in the quarter. Key operational challenges at the Jundee and South Kalgoorlie sites have reportedly impacted production by up to 20,000 ounces.
For the Kalgoorlie Production Centre, December gold sales were approximately 203,000 ounces, while KCGM reported 110,000 ounces. The KCGM site faced reduced throughput due to a primary crusher failure that halted production for four weeks. Management indicated that while normal operations are set to resume in early January, throughput is expected to remain inconsistent as the site transitions to a new expanded mill, slated for commissioning in early FY 2027.
The Yandal Production Centre fared similarly, with December sales totaling 91,000 ounces. Production setbacks at Jundee and Thunderbox were exacerbated by prolonged recovery efforts and lower mined grades, respectively.
Additionally, the Pogo site contributed 53,000 ounces to the total, facing challenges due to lower mined grades from underground mining dilution.
Management has warned that these lower gold sales are set to impact cost performance as well, with further details expected in the upcoming quarterly results scheduled for later this month. Investors are left to grapple with the implications of this sudden downturn as the company navigates these operational hurdles.
The market’s reaction reflects growing concerns among investors, prompting urgent discussions about the future viability of Northern Star shares. As trading continues, stakeholders are closely watching for any further developments and guidance from the company.
As for potential investors considering Northern Star Resources, experts advise caution in light of these recent challenges. In fact, investing expert Scott Phillips recently emphasized that Northern Star Resources may not be one of the top stock picks currently available.
With the situation evolving rapidly, there is heightened anticipation for Northern Star’s next steps and how they will address these operational difficulties moving forward.
