Northern Star (NST) | Lower grades, higher costs
10-15% lower than NST’s expectations: Production of 239,031oz, at an AISC of A$1,590/oz, was the full 15% below our forecast for the quarter. Given the guidance by NST, the quantum was at the high end and should come as only a minor surprise. However, we were surprised by the lower than expected grades at Jundee and Kalgoorlie and the lower throughput at Pogo. The grade decline appears to have been driven by treatment of stockpiles and limited access or scheduled higher grade feed. Operating costs in $m terms were broadly in line, but the lower denominator pushed the costs up from A$1,421/oz to A$1,590/oz, rather than our modelled $1,270/oz.