West African Resources Stock

Good morning, and welcome to the West African Resources Investor Webinar and Conference Call. [Operator Instructions]

I'll now hand over to West African Resources' Executive Chairman and Chief Executive Officer, Richard Hyde. Thank you, Richard.

Thanks, Nathan. Good morning, and thank you for joining West African Resources June quarter conference call.

Joining me today are the Chief Operating Officer, Lyndon Hopkins; Chief Financial Officer, Padraig O'Donoghue and General Manager of Finance, Todd Giltay.

It's been an important and defining quarter for West African as we achieved record gold production across our gold operations in Burkina Faso with group gold production of just over 125,000 ounces. This firmly demonstrates that we're on track to achieve our goal of becoming a plus 500,000-ounce gold producer, having achieved a run rate that exceeds that target this quarter. It was another strong quarter across the group with both our Sanbrado and Kiaka production centers contributing to year-to-date gold performance and remaining on track to meet annual production guidance of 430,000 to 490,000 ounces of gold.

We've achieved this at an all-in sustaining cost of USD 1,730 per ounce. This remains well under our 2026 guidance of $1,900 per ounce all-in sustaining costs, and we were tracking well on that year-to-date with all-in sustaining costs of USD 1,823 per ounce for the half year. Group gold sales for the June quarter were 110,737 ounces at a realized price of USD 4,556 per ounce. Year-to-date group gold production reached 232,905 ounces, while our year-to-date gold sales were 214,883 ounces at a realized price of USD 4,744 per ounce.

In addition, we've had great success with the drill bit this quarter reporting outstanding infill and extensional drilling results from the M5 deposit at Sanbrado, and I'll go into that in more detail shortly. At Sanbrado, our team delivered over 57,000 ounces of gold production and over 45,000 ounces of gold sales at a realized price of USD 4,568 per ounce. Production increased 37% compared with the prior quarter, mainly reflecting higher mill grade driven by increased tonnes and grade from underground mining.

Sanbrado underground performance was a key contributor, M1 South underground mined 1,000 -- sorry, 167,000 tonnes of ore at 8.1 grams per tonne for 43,644 ounces of gold in the quarter with underground mined ounces of -- underground mining ounces 60% higher than the March quarter and the grade also improved 9%. Owner-operators open pit mining continued to ramp up during the quarter. The Sanbrado process plant continued to perform strongly, milling 787,000 tonnes at a head grade of 2.4 grams per tonne and a recovery of 93.7%.

Pre-strip mining activities at Sanbrado satellite deposit, Toega continued at a much higher rate in Q2 and included first ore mine from the Stage 1 pit. Sanbrado has produced just under 100,000 ounces for the half year. And at Kiaka, we achieved core production of over 67,000 ounces of gold, slightly up on the last quarter and sold over 65,000 ounces of gold at a realized price of USD 4,548 per ounce. Kiaka continues to be an important part of the group's production profile having produced more than 130,000 ounces of gold for the year-to-date.

Mining activities remained focused on the Kiaka main Stage 1 pit while increased mill throughput supported higher gold production. Open pit mining production at Kiaka did slow during the quarter due to limited supply of explosives with our Kiaka explosive facility still awaiting operational approval from the government. Our 2026 Kiaka plan has been adjusted to concentrate on areas of free dig. We also reduced waste stripping at Kiaka and Toega to allocate the available explosive supply to ore production. In terms of cash balance, we ended the quarter with AUD 876 million in cash and $247 million worth of unsold gold bullion, reflecting a very strong balance sheet.

I'll now hand over to Padraig to discuss the financials in more detail. Thanks, Padraig.

Thank you, Richard. The WAF Group generated USD 711 million of gold sales revenue in the quarter from a record high 110,737 ounces of gold sold at an average realized gold sales price of USD 4,556 per ounce. Our notional net cash, which is calculated as cash plus bullion minus debt increased by USD 48 million in the quarter to sit at roughly USD 0.5 billion at 30 June 2026. This cash build in the quarter was after the group fully cleared its 2025 income tax and dividend payment obligations to the Burkina Faso government. As reported in our Appendix 5B, we generated AUD 249 million of operating cash flow in Q2 and ended the half year with a record high cash balance of $876 million, as said by Richard. Our capital investing activities in Q4 used AUD 112 million cash, which comprised AUD 12 million for Sanbrado, $30 million for Toega and $70 million for Kiaka. Financing activities used AUD 105 million cash in Q4, mainly comprised of $24 million of loan payments and $11 million of interest payments and the priority dividend to the Burkina Faso government of $67 million.

I now hand back to Richard for his comments.

Very good. Thanks, Padraig. As mentioned earlier, we're mining at Toega and progressed that project on several fronts during the quarter. However, the Stage 1 pit is currently behind schedule and ore delivery to the Sanbrado mill is expected to be delayed due to lack of explosives availability in country. Construction of site infrastructure, including workshops and offices continue to progress on schedule with completion expected in Q3. All road construction has now been completed, and the preferred local contractors has been selected for ore haulage to Sanbrado. The 13,500 meter infill drilling program targeting the Toega underground resource is ongoing, with results expected to be reported in Q3.

That brings me on to our exploration efforts, which continue to demonstrate real value for West African. We're on track to achieve more than 100,000 meters of drilling across Sanbrado, Kiaka and surrounding areas in 2026. During the quarter, outstanding infill and extensional results were reported from M5 underground, targeting conversion of inferred mineral resources between the 1,800 and 1,600 levels, which is approximately 500 meters to 570 meters below surface and grade control of the lower levels of the ore reserve.

A highlight results from the diamond drilling program below M5 was 27 meters at 6.7 grams per tonne and our infill diamond drilling also returned to an outstanding results, including 29 meters at 16.4 grams per tonne gold, 39 meters at 5 grams per tonne gold and 13 meters at 9.9 grams per tonne gold. These results confirm the quality and consistency of Sanbrado's ore bodies and highlight the potential for significant ore reserve growth at M5 south. Post quarter, we also reported infill diamond Drilling completed within the ore reserve at M5 North and these results will be incorporated into an updated resource model and will support a final pit design update along with an optimization of the Sanbrado mining schedule, which is also underway in preparation for the updated 10-year production forecast due in Q1 2027.

Our drilling will focus -- our drilling focus will now shift to other areas of the M5 deposit, targeting further resource and reserve growth opportunities. We also expect to release results from Toega underground during Q3. In regards to our permitting, in addition to our Kiaka Explosive facility, we're awaiting approval to include Sanbrado M5 South underground in our life of mine plan. We'll just start mining there. We've got it in the life of mine plan already. And while we expect this in the second half of this year, we don't see any impact on overall production for 2026. But we're now planning that underground mining at M5 South will commence in early 2027, subject to the government's approval. But we believe there's sufficient flexibility within the life of mine plan, like I said, to maintain our production targets for 2026.

Our discussions continued during the quarter with the state-owned SOPAMIB regarding its acquisition of 25% of Kiaka for 70 billion CFA francs, which is approximately AUD 176 million. This is expected to be finalized in 2026, and we continue to work cooperatively with SOPAMIB on this. As you look to our ESG reporting, our safety performance remains strong with no significant health and safety incidents during the quarter and a total reportable injury frequency rate of 1.25 or our TRIFR is 1.25. And in comparison to WA's Gold Industry's most recent result of 5.57 shows that we're still a very safe operator in Burkina Faso. We continue to advance our biodiversity strategy during the quarter as well with the corporate sustainability team working alongside the site environmental managers and biodiversity specialists to develop species action plans for priority Flora and Fauna.

Planning also commenced for 2026 reforestation campaign time for implementation during the rainy season. During the quarter, our operations supported Burkina Faso's Eighth National Tree Day donating trees growing in our on-site nurseries. Tree planting activities were also carried out across our sites using locally significant species. Social investment in the quarter continued on education, livelihood restoration resettlement and at Kiaka, with our supplier ORIX, we progressed the construction of a new preschool in the town of Gogo, and that's now more than 70% complete.

The outcomes from our vocational training programs remain strong with 76% of participant starting businesses or continuing further education and 7 cooperatives trained in sustainable biofertilizer production. At Toega, about 90% of households have moved into their new homes, at Toega resettlement site, and community engagement is underway to support safe ore haulage from Toega to Sanbrado. We've held community meetings across nearby villages to inform and educate community members on the haul road. The use of community crossings changes the haulage schedules and patterns and other related safety matters to help ensure we can operate this road as safely as possible.

In closing, I'd like to congratulate our team on defining -- on a defining June 2026 quarter. We delivered record production, strong financial performance and continue to demonstrate the quality and longevity of our assets through outstanding drilling results at M5 and steady progress at Toega. Our balance sheet is robust, and our operations are performing safely and reliably and we remain firmly on track to meet our 2026 production and cost guidance. With a run rate of over 500,000 ounces and a strong pipeline of growth and a clear strategy, West African is exceptionally well positioned for the second half of 2026 and beyond. Thanks, Nathan.

Thank you. [Operator Instructions] Your first question comes from Mike Millikan at Euroz Hartleys.

Just a very quick question, firstly, on the priority dividend, obviously paid to the government and what it means to WAF. Could you just chat through the withholding tax and how it means for repatriation of funds and stuff for 5 seconds?

Sure. I'll pass it on to Padraig, so he can run you through that, Mike.

Yes. We -- during -- or the end of 2025, the dividend declarations that addressed the 2025 financial year, the operating subsidiaries declared dividends that fully paid the government its priority dividend and also fully paid WAF its share of profit dividend and then also WAF's previously unpaid retained -- share of retained earnings dividend. So there was a big catch-up dividend paid in 2026 related to 2025. So that created a very large dividend, but also very large withholding tax. So we hope that explains the highway holding tax on those dividends.

Yes. Got you. That's really good. And also, just obviously, explosives watching that shortage in country, you guys still waiting for your permit for the manufacturing and storage. How is the permitting going in regards to that? Is it kind of how long is a piece of string? Or is it something that the government is looking to address pretty soon?

I'll just let Lyndon Hopkins answer that question. Thanks, Mike.

Yes. Thanks, Mike. Look, we've been working very closely with our supplier, Maxam for a while now with the government to expedite this. And we've had a number of site visits recently to check on safety standards and that sort of thing. So we're hopeful that it will progress. We've also pointed out to them the damage that is caused to our production profile into the future as well. So we're hopeful that we can get it resolved.

Okay, good. And also just finally also on the underground mining there, M5 South, obviously reading the life of mine plan, you're talking about maybe delay or getting delayed because of the permitting that comes in early '27. Any sort of changes, I assume you can just change around a little bit on the mine plan, but can you just see sort of impacts we might expect there?

Yes. Mike, it's Richard. Look, we're kind of fortunate that we've got quite a flexible mine schedule. And at this stage, we're probably accessing more of M1 South and more of M5 open pit and there's some other areas in M1 underground that we can access as well. So look, we don't see any impact across our projects this year for either the permitting of the underground or the permitting of the explosives. But, yes, look, I'm confident that we can catch it up in early 2027. But look, they're critical for us. We need to get the underground online, and we've provided the government all of the information required to do that. So it's -- we're expecting that to be granted in the back half of this year. And like Lyndon just mentioned with the permitting for the explosives, we are fortunate that Kiaka has got other areas of free digs that we can access, which is what we're doing. So we're mining into some of our other stage pits a bit earlier than we would have expected. But again, it shows how robust and flexible the projects are.

Yes, cool. And just finally, a very last one for me, just talking about M1 south, obviously, some really nice grades coming through now. Is that progressing into the next quarter as well? That was a nice kickup on grade during Q-on-Q.

Yes. You would have seen in Q1, we had a lot of development, and we're kind of reaping the benefits of that now in Q2 and Q3 and for the rest of the year. So we'd expect that strong production from the underground to continue for the rest of the year.

Thank you. Your next question comes from Regan Burrows Macquarie.

Just in terms of, I guess, if the payments don't come through over the second half or if they're sort of a little bit delayed, and towards the back end. I mean what's the delta in terms of the grade and tonnage from that free-dig material versus, I guess, the unconstrained mine plan?

Well, no, at Kiaka, no difference in grade. So the grade is very consistent across. So we're just accessing near surface softer material at the moment. There'll be a catch up, but there's a lot of capacity in the mining fleet at Kiaka. So, we don't really see any impact on that at this stage. And then with Sanbrado and M1 South, obviously, contributes the bulk of the ounces for Sanbrado production. We will just have to -- the delta will be -- the underground is about 3 grams and the open pit is about 1 grams, so the delta is about 2 grams. But I think we're pretty confident we'll get those permits in the back half of this year and we shouldn't see any impact into 2027.

I mean we've got capacity across the open pit mining fleets. M1 South is pretty much unconstrained now for the rest of 2026 for the development has been done in the early part of this year. So yes, look, we're confident there should be no impact, but it's -- we need the permits, that's for sure for the longer-term production of the projects.

And just on Kiaka with the explosives. I mean I think you mentioned just before the supplier that you're working with, is it sort of just a lack of availability that's sort of constraining and forcing you to sort of focus on a free dig material? Or is it higher cost as well?

No. We've got a contract with Maxam. So the cost is fixed. It's availability. We've got -- we've previously operated our explosives magazine at Sanbrado, and that needs to be re-permitted. And we've also got a fully functioning facility for manufacture of explosives at Kiaka, which is yet to be approved by the government. So currently, there's only limited manufacturer of explosives in country. And again, we're fortunate that we've got flexibility in the mine schedule that we can work around at the moment.

Great. I just might squeeze another one in. Just in terms of the SOPAMIB payment, obviously, it's tied with that change of ownership. I mean what's sort of left to negotiate and finalize there?

Well, the terms that are in a decree, which has been published by government. So that's the 70 billion CFA francs and the percentage. So there's no negotiating around that. We're just finalizing the documentation with the government, and we expect to have that completed in the next quarter.

Okay. So targeting in the next quarter. Awesome. All right, I'll leave it there.

Thank you. There are no further questions at this time. So I'll now hand back to Richard for closing remarks.

Thanks, Nathan. And look, thanks again to all of our supporting shareholders who have been with us for a long time, and congratulations to the WAF team again for a wonderful quarter, and we look forward to a strong second half of 2026. Thank you.

And welcome to the West African Resources Investor Webinar and Conference Call. [Operator Instructions]

I'll now hand over to West African Executive Chairman and CEO, Richard Hyde. Thank you, Richard.

Thanks, Nathan. Good morning, and thanks for joining us for West African Resources March 2026 quarterly call.

It was a productive quarter for our gold operations at Sanbrado and Kiaka in Burkina Faso. But before I get into discussing our performance, I want to address the ownership structure changes at Kiaka in regard to the Burkina Faso government.

This has been under discussion for a while now. And as we've announced this week, the Burkina government plans to acquire an additional 25% equity interest, in our subsidiary, Kiaka SA, who is the operator of the Kiaka Gold Mine. This will take the government's interest at Kiaka at 40% as it has an existing 15% free-carried stake already. This additional capital share in Kiaka SA has been valued by the government at XOF 70 billion, which roughly equates to AUD 175 million.

There has been no discussion with the government regarding the ownership of Sanbrado or Toega and Toega is obviously on track to start producing later this year. And they were not referred to in the decree that was published in regards to Kiaka.

We are working with the government to finalize the terms of the acquisition, the Kiaka, and we aim to have that completed by the end of this calendar year.

At this stage, we plan to distribute any cash proceeds from the sale of the equity sale of Kiaka SA to our shareholders by way of a special dividend, and we'll keep you updated with any developments regarding this.

Regarding our results for Q1, we achieved gold production of 107,728 ounces across both Sanbrado and Kiaka for the quarter at an all-in sustaining cost of USD 1,921 per ounce. We remain on track to achieve our annual production guidance of 430,000 to 490,000 ounces of gold, with all-in staining cost below USD 1,900 an ounce.

Gold sales were steady compared with the previous quarter with 104,000, 145,000 ounces sold in the quarter, and we achieved this at a price of USD 4,945 per ounce. This is a strong result given our unhedged exposure to the higher gold prices, and we generated AUD 440 million from our operating activities in Q1. This took our cash balance to a record $847 million with $213 million in unsold gold bullion at the end of the quarter based at current prices.

Looking at each operation in more detail. Sanbrado continued its steady performance in Q1 with 42,024 ounces of gold production, which is in line with the planned 2026 annual production profile. Sanbrado will see higher contribution of mine ounces from the M1 South underground over the remaining 3 quarters of 2026 as more stoping areas become available.

We achieved Sanbrado's production at site sustaining cost at USD 2,034 per ounce and sold 42,428 ounces, an average realized price of USD 4,978 per ounce.

Unsold gold bullion at Sanbrado at the end of the quarter totaled 11,794 ounces, rate at about USD 54 million.

The Kiaka production continued to ramp up in the quarter, delivering 97,906 ounces from open pit mining operations, and we produced 65,704 ounces from processing operations. And this represents an 18% increase and 6% increase, respectively, over the previous quarter in mined and processed ounces.

Kiaka deliver gold production at a site sustaining cost of USD 1,779 per ounce. We sold 61,717 ounces from Kiaka at an average realized price and USD 4,922 an ounce. With unsold bullion just over 20,000 ounces held at the end of the quarter, which is valued at about USD 92 million at the current gold price.

While this production performance was impressive, we also delivered on several other fronts during the quarter. We released our updated Resources Reserves and 10-year Production Plan in the quarter, which demonstrated further increases to Kiaka and Sanbrado's production plan on the back of outstanding results from our 2025 drilling programs. We're now looking at delivering average gold production at 533,000 ounces of gold per year over a 10-year period, with gold production expected to peak in 2030, just short of 600,000 ounces.

Sanbrado's mine plan has been extended out to 2036, with this production expected to peak in 2030 at 317,000 ounces. At Kiaka, we've also modeled higher production throughputs based on exceptional performance from the process plant since we started operations.

Our unhedged mineral resources now stand at 13.6 million ounces of gold, while ore reserves totaled 7 million ounces. We see potential to improve annual production further through ongoing drilling programs and we plan to drill more than 100,000 meters annually targeting extensions at M5 South Underground and beneath the M5 North Open Pit and also targeting underground potential at Toega.

This 10-year plan highlighted just what a strong and sustainable future our company has and our potential to continue generating value for stakeholders and host communities over the next decade and beyond.

Speaking of the future, Toega, our development projects continues to progress well with open pit pre-stripping commencing later -- commenced late in the quarter and a total of 621,000 Bcm of material were stripped. Surface grade control drilling was completed during the quarter in preparation for first ore mining, which is on track for -- this quarter Q2 and delivery of that ore up to the Sanbrado process plant is expected to start in early Q3.

In terms of exploration, we released impressive results from our in M5 South Underground drilling program, where high-grade gold mineralization was extended by 400 meters below the current mineral resource. Our resource conversion drilling program is also progressing on schedule.

We also reported good results from our drilling programs at M5 North, which returned wide intersections and delivered consistent mineralization below the current open pit ore reserve and M1 North where results support potential for a cutback.

In addition, 13,500 meter program targeting the Toega underground resource is ongoing. We plan to incorporate results from Sanbrado into an updated resource reserve and 10-year production plan into the coming quarter.

With that overview of operational activities.

I'll now hand over to Padraig to discuss the financial results. Thanks, Padraig.

Thank you, Richard. So the WAF, as Richard mentioned, the strong gold sales, the WAF Group generated AUD 742 million of gold sales revenue combined in the quarter from an average gold price of USD 4,945 per ounce. And we generated AUD 440 million of operating cash flow in Q1 and ended the year with a record high cash balance of AUD 847 million.

Looking at the notional net cash, which was calculated as cash plus bullion minus debt, we more than doubled the notional net cash in the quarter and ended the quarter with USD 450 million notional net cash position.

Our capital investing activities in Q4 used $90 million cash, which was comprised of $38 million investment into Sanbrado, $23 million into Toega and $29 million at Kiaka.

Financing activities in the quarter used $45 million cash in Q4, mainly comprised of $28 million of loan payments and $11 million of interest payments.

I now hand back to Richard for his comments.

Thanks, Padraig.

Thanks, Rich.

So as you can see, it's been another strong quarter for West African on the production front. In terms of our ESG performance, we're also tracking well with environmental activities such as seedling production and for donations giving back to our communities and we continue to invest strongly in areas such as education, health, economic development.

We're working with our contractors to enhance these programs, leading to more support for local education facilities. We also supported local schools with donations of bicycles and school supplies during the quarter.

Our community relations team coordinated education sessions on the risks associated with artisanal and small-scale mining, school absenteeism, and we handed over storage warehouses to 4 agricultural crops produce run by local residents who have been -- who received help training to help support their local communities.

With our operations at Sanbrado and Kiaka performing well, we are pleased to be a positive contributor to the communities in which we operate, as well as Burkina Faso more widely.

I'd like to thank our employees and contractors for their efforts as well as we wouldn't be able to achieve these results with the outlook.

Thanks again for your interest in West African Resources and for joining the call today. I'll now hand over to Nathan to see if we have any questions.

[Operator Instructions] Your first question comes from Paul Howard at Canaccord.

A couple of questions from my end, if you don't mind. How does the Burkina Faso government intend to pay that $175 million? You mentioned any proceeds, cash proceeds perhaps being redistributed as a special divi. But is the government intending to actually hand you physical cash?

Thanks, Paul. Yes, looking now extensive discussions with them. We've discussed the cash payment. The government's who will be seeing record high revenue from the current gold price from the operations that operating country. And then given the return that the government will get on this investment, it's something that's probably commercially attractive to banks as well. So we're expecting to be paid in cash.

Great. A couple more and perhaps more of Padraig's avenue is, what's the debt repayment schedule? So I was a little more debt expected to pay this quarter, but how should I look at that going forward.

Padraig?

Yes. I can't remember exactly debt repayment schedule, but it's over 3 years remaining, I think, and there's a large bullet at the end. So about $100 million bullet. Yes, in 2028, there's $100 million bullet. So we have fairly low debt repayments until we hit 2028.

Yes. It's the bullet I don't have, which makes sense. Awesome. And while I've got you then, no tax payments this quarter? And indeed, the subsidiary payment, that's normally that 3.9 in your cash flow report?

Yes, we paid the tax installment for Sanbrado early. We paid it before the end of the year in 2025. So that's why it doesn't show up in Q1 2024. So Sanbrado installment was paid. Kiaka didn't pay tax installments in 2025 because this is first year of operation. So we have tax settlements coming up, though, in -- at the end of April where we'll larger tax returns and then have to pay the taxes due on those years on the 2025 year.

Right. And then that line in the cash flow, we have 3.9 of subsidiary minority interest profit distribution?

Yes. So subsidiary minority distributions have been calculated now, we are looking at around AUD 68 million for both combined Sanbrado and Kiaka to be paid sometime in Q2. And on the income tax, they have been calculated as well. And we have about AUD 120 million that we'll be paying to clear the 2025 taxes payable balances.

Got you. So that's AUD 120 million, right?

Yes.

Yes. And then that AUD 68 million you got to pay in April. Is that relating to March quarter?

No, this is the priority dividend. So the priority dividend is paid annually. Related to 2025 earnings, but it will be paid, not in April, but sometime over Q2.

Your next question comes from Richard Knights at Barrenjoey.

Just hopping on the $175 million again. Just wondering if you have any insight as to how the government came up with that number? And in your opinion, is that within the bounds of the new mining code in Burkina? And I suppose where I'm going with this is, where do you see the risk then that this pops up again for Sanbrado down the line?

Thanks, Richard. So look, the valuation mechanism used in the 2024 Mining Code is -- it's not an NPV-based calculation. It's government bases that a lot of costs required to sustain operations, so effectively a sustaining capital estimate for the life of mine. So it's unusual, but it's -- that's within the 2024 Mining Code. It still results in a substantial number. It's not 0.

Now in our discussions with SOPAMIB, which is a government representative, we've addressed our other operations and they're not being -- for our understanding, they're not being targeted to have the same treatment. And we'll also be addressing that or we'll be looking to address that in our documentation process regarding the 25% equity interest for the government. So we'd like to see no further changes to our other operations and an issue that other fiscal financial terms for our other operations on our drilling. Yes.

Is there a way you can get surety around that or is that or...

Yes, we're attempt to do that, and then we'll address that in our documentation process.

Okay. 6 Okay, fine. And then in that same announcement, I mean you did -- I think you mentioned in your comment that you're still looking or you held discussions around further collaboration on near mine sorry, near development assets. Is that something that we could potentially see more detail on this year?

Yes, I think so. It will take a little while because we need to get our people involved and we need to do some technical reviews of what the projects that have been discussed. But there's -- I think it's a good chance that we'll advance that this year. And there are some assets that need a lot of drilling. I think that's -- we see that with a lot of older projects that they're underdrilled and there's definitely good potential and some of them when they're in reasonable locations in Burkina. So that's a process that we'll have to go through technically now and assess them and then pull a view on what we think we can move forward with.

Your next question comes from Mike Millikan at Euroz Hartleys.

Yes. Excellent cash generation for the quarter, Richard, congrats. Just more very quick 1 on the paid consideration, should we expect that to be the day of the decree or when -- actually, when you receive the money, how should we think about that?

No, under the law is, the benefits received until the shares are paid out. So we expect that, that will be later this year or when we receive payments.

Yes, got you. So the effective change of ownership only once the funds are received?

Correct.

Yes. Obviously, a very quick question on the diesel in country. Obviously, it's regulated. How is your suppliers, stockpiles, should we -- any comments around that?

Look, I was just in country. So we've typically got across both sides, something like 70 or 80 trucks in circulation, either heading to site or heading from a site to the port. So fuel comes from Benin and Togo, which is in the -- to the southeast of Burkina. We typically keep at least 2 weeks of storage in tanks on site. And then when I was there, there were another week or so of trucks sitting at the mine gate. And then we've also got trucks in circulation. So it's something that we've been aware of for a while. We were addressing this before the current crisis in the Middle East.

We've definitely seen a drop off in availability, but I think it's something that we planned for and that we're dealing with.

Cool. And also your stockpiles seem pretty high both operations, roughly 72,000 ounces at each, which is pretty impressive.

Dividend policy, Richard, have you guys thought of one? Or what -- I mean, obviously, there's a lot of cash generation specialty becoming. What is -- is there a bit of a thought on a bit of a policy to publish?

Look, as far as policy goes at this stage, we're obviously still -- Kiaka is still a new mine, so it's generating a lot of cash, but we've got a fairly big few months in finalizing the 2025 tax payments and dividends to the government. And then we'll be looking to bring as much cash up after that and -- we haven't set a policy at this point. We will pay -- I think what we've said is a substantial dividend. So I mean -- I think it's going to be a meaningful amount.

Padraig, would you like to elaborate further?

Yes. I mean when we say a meaningful amount, we're talking the hundreds of millions of dollars AUD. We just haven't decided on the amount yet. We'll do our cash projections and we need to forward project all of the government dividends and taxes and working capital needs for expansions, et cetera. We still have the Toega's stripping program going on, et cetera. So we will -- it's a bit early for us to have a dividend policy based on percentage of cash flow or profit at this stage.

Yes, got you. And maybe a buyback versus paid dividends. Is it -- again, given that you just contemplating while both or either.

Yes, correct. So look, I think we'd like to have the option to buy back our shares if we see weakness. And we'd like to be a strong dividend-paying company as well. So -- but having all those different tools in the shed would be pretty handy.

And just finally for me. Just, Richard, you mentioned something -- are you talking another update for War Sanbrado in regards to resource growth. Is that what I heard?

Well, there will be, yes, we've got a lot of infill drilling going on at M1 South. So while it might not move the needle on ounces overall it will certainly improve the category. It's not as meaningful, I think, as our last update, which was during Q1, in March.

So mostly focused -- obviously, M5 South Underground some of those good extension was there. Got you.

Thank you. There are no further questions at this time. So I'll now hand back to Richard for closing remarks.

Thanks, Nathan, and thanks to WAF team for another sensational quarter of production. I think it's quite impressive. I can probably say we're just ordinary people achieving extraordinary things, and I'm very proud of the team. And we look forward to another strong quarter for Q2. We've had a great start to Q2 production already, and then delivering on our plans for the rest of the year. So thank you very much for dialing in, and we look forward to keeping the market updated with our progress.

Good morning, and welcome to the West African Resources Investor Webinar and Conference Call.[Operator Instructions]

I'll now hand over to West African Executive Chairman and CEO, Richard Hyde. Thank you, Richard.

Thanks, Nathan. Good morning, and welcome to the December 2025 Investor Conference Call for West African Resources, and thanks for joining us today. Joining me on the call today, we have our Chief Financial Officer, Padraig O'Donoghue; and our General Manager of Finance, Todd Giltay; our Chief Operating Officer, Lyndon Hopkins, is on site at the moment in Burkina.

The December 2025 quarter delivered another strong period of gold production across both our Sanbrado and Kiaka gold operations in Burkina Faso with just over 112,000 ounces of gold produced across the operations, delivering an operating run rate that bodes well for our gold production in calendar year 2026.

Our total gold production for calendar year 2025 was a touch over 300,000 ounces of gold with Kiaka stepping up in Q4. This was well within our production guidance for the year. What's more is that we completed this achievement with no significant health, safety or social incidents, which is especially important to us and demonstrates our commitment to operating in a safe and responsible manner at all times.

We sold 105,995 ounces of gold at an average price of USD 4,058 per ounce for the quarter, and we remain fully unhedged, therefore, allowing WAF to take full advantage of the record gold prices we are currently seeing. With all our sustaining costs -- sorry, with our all-in sustaining costs averaging USD 1,561 per ounce across the two operations, we've been able to deliver AUD 389 million of cash -- sorry, cash flow in the quarter, and that's after making income tax payments of AUD 48 million.

Our cash balance at 31 December 2025 is AUD 584 million, plus we still held another AUD 177 million worth of unsold gold bullion, and that's just due to timing of shipments. Looking at our sites, the Kiaka ramp-up has been excellent since its second quarter start-up. And its performance in Q4 really demonstrated that. This is the first full quarter of operations for the site. It produced 62,287 ounces of gold for the quarter, surpassing production at Sanbrado for the first time.

Kiaka's costs continue to improve as production has increased, which was what we expected, and it's pleasing to see this panning out. We expect costs to further reduce as our reliance on diesel generated power reduces over the coming quarters. Kiaka produced just over 95,000 ounces of gold for the year after commencing operations in Q2 and having a shortened operational phase in Q3. Open pit mining continues to ramp up as more equipment is commissioned for use.

At Sanbrado, our steady production continued, and we produced just under 50,000 ounces of gold for the quarter, bringing our total for the year to 205,228 ounces. Sanbrado performed well against production guidance, achieving the upper end of our 190,000 to 210,000 ounces production range. Open pit recommenced in the quarter under our new owner mining operating model. Open pit mill feed in Q4 was sourced from both the M5 North pit and previously mined ore stockpiles. Mined ounces for the quarter from M1 South underground was 37,955 ounces, which was 16% below the previous quarter. This was due to a 14% drop in mined grade as well as slightly lower ore tonnes mined.

With that overview of our production, I'll hand over to Padraig to discuss our financial details for the quarter.

Thank you, Richard. WAF, as Richard mentioned, WAF has benefited tremendously from being unhedged and generated AUD 662 million of gold sales revenue in the quarter at an average realized price of USD 4,058 per ounce. For the full year 2025, WAF generated more than AUD 1.5 billion of revenue. As Richard mentioned already also, we generated AUD 389 million of operating cash flow in Q4 and ended the year with a very strong cash balance of AUD 584 million.

Our capital investing activities in Q4 used AUD 113 million of cash, which included AUD 89 million for Kiaka and AUD 23 million for Toega. Financing activities used AUD 23 million of cash in Q4 with payments for loan interest, principal and financing expenses offsetting cash received from the drawdown of equipment finance facilities.

I now hand back to Richard.

Thanks, Padraig. So on the exploration front this quarter, diamond drilling beneath the M5 open pit ore reserve has confirmed potential for us to extend open pit mining at Sanbrado. Gold mineralization was confirmed more than 300 meters below the current ore reserve and mineralization remains open at depth. And this is really the first substantial drilling we've done at M5 North since about 2017. So it's no surprise that we can see that this mineralization being extended and then we're considering our options there, but most likely, updated ore reserve would consider cutting back the northern part of the M5 open pit.

So some of the drilling results included 16 meters at 11.2 grams per tonne as well as more typical broad intersections such as 45 meters at 1.9 grams per tonne gold. Diamond drilling at M5 North will continue through 2026 and we look forward to further results from the program to help us better plan for the future mining at Sanbrado. But the future looks very good.

Our last ore reserve estimate was completed at a much more conservative gold price of USD 1,400 an ounce. So recalculating today we would expect to use a higher gold price and obviously deliver more ounces into reserve. We also have drilling underway at underground for Toega. We continue to develop a satellite operation for Sanbrado, which we continue to develop as a satellite operation for Sanbrado.

We're currently completing a 13,500 meter infill drilling program, which is infilling the underground resource and we'll have more results over the coming quarters. Grade control drilling also confirmed during the quarter with -- commenced during the quarter with 6,600 meters completed. This program is expected to be completed in early Q1 2026 with results to follow.

In other developments at Toega, earthworks for the mine services area were completed and the construction of mobile maintenance workshop office and ancillary infrastructure has commenced. The haul road construction is well advanced and remains on schedule to enable order delivery to the Sanbrado process plant in early Q3 2026. Toega open pit mining operations will be owned and operated by WAF, similar to Sanbrado. Mining equipment continued to arrive on site during the quarter with commissioning activities underway. All mining equipment is expected to be fully operational by the end of this quarter.

Pre-stripping of open pit mining of the open pit commenced during the quarter with a total of 250,000 BCMs moved to date. Material movement is expected to ramp up to steady-state production by the end of Q1 2026. Across other aspects of our business, we continue to invest heavily in social programs, including education, health, economic development, including providing scholarships to high school students from the area, upgrading our community health centers and constructing a new primary school and refurbishing an existing school near Kiaka, which will also be used for community events outside school hours.

In relation to discussions with the Burkina Faso government regarding Kiaka, we continue to engage constructively with the government on these matters. But at this stage, there are no material updates on that matter. Overall, I'm really happy with our performance and progress throughout Q4, particularly with our ramp-up at Kiaka. We're looking forward to releasing our 2026 annual production guidance and outlining our capital management strategy later in Q1 2026. I'll now hand back to Nathan for the Q&A.

[Operator Instructions]

Your first question comes from Mike Millikan at Euroz Hartleys.

Just a couple from me. Firstly, talking about obviously, very strong cash generation at the moment. Debt service, are you going to accelerate some of those payments?

Yes. So that will be a focus throughout this year and get debt down to a management -- a manageable level. That's our first focus. And then we're having active discussions in the office now and amongst our Board about capital management, which will take us past 2026 whether that's buying back shares or paying dividends, that's the discussion that we're having at the moment.

Yes. Is that the plan, certainly a buyback probably makes a lot of sense.

Yes. Look, they both make sense. We just really need to gauge the market and really from -- I'm a follower of Berkshire Hathaway, and they've always bought shares back and they've never paid a dividend though. So -- but it's either/or, I think it's going to be a good outcome for shareholders if we do either. But that's certainly our focus at the moment is to pay down debt and then either buy back shares or pay a dividend.

Yes. Awesome. Just looking at, obviously, the royalty rates currently in country, obviously pretty high. Is there any sort of changes expected there? I mean just it's obviously on a slowing scale and obviously, gold price is very high. Has some of your discussions also been centered around royalties?

No, not at this stage. I mean the gold price has risen so quickly. I think we're an average sale price of about USD 3,500 in Q3, and we've sold an average over USD 4,000 an ounce in U.S. Q4. So -- and already, we're well over USD 5,000 an ounce as we speak now. So really, the action has been pretty recent, and we'll be back in country in a few months' time and definitely raise that with the administration.

Yes, cool. And finally for me, just on Kiaka grid power, has it all been going? Has it been stable? What's your expectations for calendar '26 in regards to reliability? And what do you factor in some of your forecast?

So that will be kind of -- I think we can explain more of that later in the quarter when we put our guidance out. We had 2 or 3 weeks of stability or stable grid in December, and that allowed us really to ramp up production. And we consistently hit 30,000 to 35,000 tonnes a day in production at Kiaka, which was really, really good. So clearly, the last piece of the puzzle for Kiaka is stable power.

We're also looking at installing a full HFO power station, which would allow us to have full production. So we'll have more information on that in our annual guidance. We've also increased the diesel capacity on site. So there's another 5 gensets arrived overnight on site. So they'll be plugged straight in, and that should give us about 30 megawatts of diesel on site.

The last week has been pretty unstable with the grid, but there has been work being done by SONABEL, which is the government's energy provider in country. So we should be back on the grid in the coming days. And then we've also got some other equipment arriving on site, which will help stabilize the grid on our side.

So look, it's early days with the grid. Long term, it's definitely the right option. In the short term, we've made provisions for additional diesel power and we're making a plan to have full backup with HFO, which is much cheaper to run in diesel. So that's kind of the summary at the moment, but I think the takeaway is that with full power, Kiaka is capable of producing of processing more than 10 million tonnes per annum without any capital -- without any material infrastructure changes. So does that answer your question, Mike?

Yes, it did. And congrats on a very good quarter. I will hand it on.

Your next question comes from Richard Knights at Barrenjoey.

Just wanted to see if I could get you to give us a little bit more detail on the discussions with the government regarding the Kiaka stake. Just anything relating to time frames or whether or not you've made any progress on those discussions with potential co-investments in other projects? Just any more detail you can give on that?

Yes. Thanks, Richard. Look, there isn't a lot of detail to give, unfortunately. We responded late last year to SOPAMIB, and we provided them with a lot of information about Kiaka, our construction costs and economic models. And again, the gold price has moved significantly since then. So I mean the discussions have been quite good and cordial. They've made it quite clear that they believe in paying market price for additional share in Kiaka. And we did counter with a proposal saying that if you have a look at our current quarter, I think we paid indirect taxes and royalties, USD 90 million in one quarter.

So clearly, we're a very good partner to the government. And probably in our view, that's the best model is that the government already gets a significant proportion of cash flow from mining operations in Burkina, which is getting close to 60% of cash flow at the current gold price. So -- and with obviously, the escalating royalty as well. So that's a significant proportion of cash flow now.

So really, there's not a lot of detail to add. We're currently waiting on a response to our most recent correspondence. And we'll update the market as soon as we've got something back. But we've given them an alternative proposal, which we showed demonstrates much higher returns on investment, given that there are assets the government already owns that aren't generating any cash flow.

So clearly, that would grow the government's share of revenue much more quickly than an incremental investment in Kiaka. But it's a discussion that we're having with them, and we're doing that in a transparent and polite way.

Thank you. There are no further questions at this time. So I'll now hand back to Richard for closing remarks.

Thanks, Nathan. Look, I guess, closing remarks, we've got a number of activities underway at the moment, including our resource reserve update. Our new 10-year plan will be coming out in late March. The 10-year plan will include drilling from M5 North and M5 South as well as extensions at M1 South underground. So I'd expect that to be a positive increase on the 10-year plan that we issued last year, which was very close to 10 years at 500,000 ounces per annum, which has been a target of mine for a long time.

So obviously, we'll keep the market updated with our discussions with the government around the ownership of Kiaka and also with the stability of the grid as it improves. So thanks very much for dialing in today, and we look forward to keeping the market updated over the coming weeks regarding our activities.