Alkane Resources Ltd (ASX:ALK, OTC:ALKEF) has delivered record quarterly production and a sharp lift in cash generation, underscoring the earnings leverage from higher gold prices and a broadened asset base following its Mandalay merger.
The company reported group production of 45,776 gold equivalent (AuEq) ounces for the March quarter, its highest on record, alongside site operating cash flow of $189 million and a $130 million increase in cash and bullion holdings.
Cash, bullion and listed investments stood at $374 million at quarter end, including $362 million in cash and bullion, reinforcing what managing director Nic Earner described as “another great quarter” for the company.
Record production drives revenue lift
Quarterly output included 44,669 ounces of gold and 377 tonnes of antimony, supported by improved mill grades at the Björkdal operation and steady contributions from Tomingley and Costerfield.
Gold equivalent sales of 43,373 ounces generated revenue of $275 million, up from $256 million in the previous quarter, driven largely by a higher realised gold price of $6,330 per ounce.
The stronger gold price environment also boosted margins, with the achieved gold price sitting well above the group’s all-in sustaining cost (AISC) of $2,928 per AuEq ounce.
Costs were slightly higher quarter-on-quarter, reflecting increased royalties tied to higher gold prices as well as diesel and input cost pressures.
Q3 FY26 All in sustaining and All in cost ($/oz).
Strong cash flow and balance sheet flexibility
Operational performance translated into robust cash generation, with underlying post-tax free cash flow of $130 million for the quarter.
The company also strengthened its financial flexibility during the period, securing a $110 million revolving credit facility and a $40 million contingent instrument facility.
These moves, combined with the growing cash balance, position Alkane to fund ongoing development and exploration while maintaining optionality for future growth initiatives.
Exploration delivers high-grade hits
Exploration remained a key focus, particularly at the Costerfield gold-antimony operation in Victoria, where drilling at the Kendall prospect identified 25 additional veins near existing workings.
Notable results included intercepts of up to 267.5 grams per tonne gold and 5.6% antimony, highlighting the potential to extend mine life through near-mine resource growth.
Map of Costerfield showing areas of exploration during Q3 FY26.
At Tomingley in New South Wales, deep drilling identified a gold-bearing structure around 400 metres below current resources at Roswell, pointing to potential depth extensions.
Meanwhile, exploration at Björkdal in Sweden continued to target extensions to existing zones and nearby growth prospects.
Operations remain steady across portfolio
Operationally, Alkane’s three producing assets delivered consistent performance:
- Costerfield (Victoria): Maintained steady output with strong grades, producing 11,691 AuEq ounces and generating $80 million in site cash flow.
- Tomingley (NSW): Produced 21,652 ounces of gold, supported by improved milling throughput following the introduction of pre-crushing.
- Björkdal (Sweden): Lifted production to 12,433 ounces on higher grades and throughput, with cash flow of $55 million.
Group production guidance for FY2026 remains unchanged at 160,000–175,000 ounces AuEq, reflecting contributions from all three operations following the Mandalay transaction.
ASX 200 inclusion marks milestone
Post quarter-end, Alkane was added to the S&P/ASX 200 index, a move expected to increase trading liquidity and raise the company’s profile among institutional investors.
With record production, strong cash flow and expanding exploration upside, Alkane enters the final quarter of FY2026 with momentum across both operations and growth pipelines.