JPM-Bellevue Gold JunQ25：Costs the new info and better than expected-20250728

Key takeaways from BGL’s JunQ25 result were: 1) Costs came in 7% below JPMewith production/sales pre-reported, 2) FY26 guidance will be released in Augustas the upcoming site visit nears (Aug 1) where costs remain the key unknown and,3) as the strategic review continues, the prospect of a change in control optionplaying out has marginally reduced in our view, as media reports indicate apotential suitor (RRL) has left the process, making an update on the operationalturnaround all the more important. Our FY25/FY26 earnings fall 31%/14%predominantly on higher D&A. Our PT is unchanged at 90cps and we retain aNeutral rating.

•AISC a 7% beat; FY26 guide to be released in August. Gold production/sales were pre-reported at 39koz while AISC came in 7% better than ourforecast. The company has noted FY26 guidance will be released in August,leaving the August 1 site visit or the full year financial result (date TBC) ascandidates for the update. Costs again are the key uncertainty, as production(150koz), growth capex ($75m) and explo ($10m) were flagged at the Aprilequity raise, as well as all-in costs of $35-$42m/mth ($420-$504mpa).Stripping out the combined $85m for capex/explo, nets a wide range for AISCbetween $2,233-$2,793/oz at 150koz production. While the finish to FY25 wasbetter than expected, we expect FY26 to settle in the lower end of this range,largely flat YoY with AISC at $2,308/oz. The site visit may also provide moreclarity on the medium term outlook for the asset, with more granularlity on the~190kozpa steady state target provided in April. The full strategic review isongoing, with recent media reports indicating RRL, who we thought would’vebeen a reasonable fit as buyers (link), have exited the process (link), making theupdate on the pathway forward for an operational turnaround more important.

•PT unchanged at 90cps, retain Neutral. Following the result our FY25earnings are down 31% on higher D&A. Our FY26 earnings fall 14% on acombination of higher costs and D&A. Our blended valuation is unchangedand we retain a Neutral rating with the stock trading within the range of our PT.