4Q26 - Turn Up the Base

Research evidence excerpt

4Q26 - Turn Up the Base

roduction (JEFe: +13% | VAe: +15%) supported by increased mined 2026 ($) 1HalfA 2Half FY

and process volumes (+22% and +12 QoQ), reflective of improved UG operating rates. EPS 0.10 0.15 0.25

FY production of 205.4ktZnEq. 2% above guidance while inventory built over 3Q26 due to PREV 0.17 0.27

rail disruptions was unwound via restoration of third-party access. LoM extension studies

underway, with open-pit FID targeted for 1H28.

Development projects. Works continued at Hermosa with surface infrastructure construction Figure 1 - S32 4Q26 comparative results

progressing in alignment with the Taylor project update on 30-Apr (see HERE). Extended

U.S. Govt. investment into the Ambler Mining District (see HERE), unlocks organic greenfields

growth with CY26's ~$42m summer exploration program commencing in the quarter.

Alumina & Aluminium. Disposal of the operating aluminium business (ex. 63.7% interest in

Mozal smelter) to Alcoa (AA US, AAI AU) for headline US$5.6b announced 1-Jul (see HERE).

Completion is subject to a "locked box" mechanism whereby Alcoa is entitled to asset CF from

1-Apr-26.

Corporate. US$325m capex through FY26 (excluding EAIs and Hermosa) and a further US

$710m at Hermosa. 2H working capital unwind of ~US$200m reverses 1H's US$130m build.

The US$2.6bn capital management program is 92% complete. .

Source: Company reports, Visible Alpha, Jefferies

Commentary. The Aluminium exit clears the largest structural overhang on the multiple,

bringing the portfolio to a majority base/precious metals EBITDA. The outlook heading into

FY27 is increasingly base metals focussed and driven by delivery of Hermosa's growth profile. Mitch Ryan * | Equity Analyst

61 2 9364 2998 | mryan1@jefferies.com

Reiterate, BUY, AUD6.00.