Evolution Mining Doubles Dividend as Annual Profit Hits Record $422M

Evolution Mining has reported a record annual profit of $422 million, driven by strong demand for gold and copper. This impressive result allowed the company to more than double its final dividend, reflecting a robust performance that exceeded market expectations.

The company's final dividend has been increased to 5 cents per share, fully franked, up from 2 cents. Evolution's shares responded positively to the news, surging 6.8% to $4.07 in early trading.

Evolution's profit beat consensus estimates, with Citi Research noting that both underlying and net profit were 10% and 15% higher than expected, respectively. The outlook remains strong, with the company projecting continued high margins and cash flow generation in the 2025 financial year. Evolution has set production guidance at 710,000-780,000 ounces of gold and 70,000-80,000 tonnes of copper for FY25.

In FY24, Evolution produced 716,700 ounces of gold and 67,862 tonnes of copper. The company expects to maintain an all-in sustaining cost (AISC) of production between $US996 and $US1063 per ounce of gold, compared to the current gold price of $US2465.

Managing Director Lawrie Conway emphasized that Evolution is "ideally positioned" for the current financial year, highlighting the company's sector-leading cost position and disciplined capital allocation as key factors supporting continued high cash generation.

Evolution’s Cowal underground mine, which reached commercial production during FY24, has already begun contributing to cash flow, fully repaying its acquisition and capital expenditure costs and generating $294.2 million in net mine cash flow. The next phase of the Cowal open pit is progressing through regulatory approvals, with a final investment decision expected in late FY25.

The Ernest Henry mine recovered from a weather-related disruption in FY23, delivering strong performance and generating $334.1 million in net mine cash flow in FY24. The ongoing feasibility study at Ernest Henry is progressing well, considering continued drilling success.

Evolution's Northparkes asset added $74.2 million to net mine cash flow, and the Mungari 4.2 expansion project is on track, positioning the operation for future cash flow generation from a larger and lower-cost production base. Red Lake showed improvements, achieving record mining tonnes in the June quarter under Evolution's ownership, setting the stage for positive cash generation in FY25.

Mt Rawdon is expected to provide valuable cash contributions in FY25, supported by stockpile processing as the operation nears the end of its mine life. Additionally, the pumped hydro environmental impact statement has been submitted, with the feasibility study progressing well.

Notably, Evolution's gearing was reduced from 33% to 25% during the year. The company also reported that only 6% of its gold production for the current year is hedged, and its copper production remains entirely unhedged.

Citi Research praised the results, suggesting that the market would likely react positively, while RBC Capital Markets described the outcome as "decent overall," noting that the guidance was in line or slightly better than expected.