Develop Global (ASX:DVP) managing director Bill Beament told investors the company’s “strong results” in the December quarter keep it on track to meet growth targets outlined in its five-year business plan, highlighting continued ramp-up at the Woodlawn restart, progress at the Sulphur Springs development project, and a newly secured mining services contract with OceanaGold in New Zealand.
Beament said the company is two years into its five-year plan and expects to reach its goal of producing 500,000 tonnes of copper equivalent a year “on or ahead of schedule.” He added that Develop’s target of two to three mining services contracts has already been met with two contracts in hand.
Woodlawn ramp-up and improving revenue metrics
For the December quarter, the company reported concentrate revenue up 98.5% quarter-over-quarter to AUD 39.1 million from 9,500 tonnes of concentrate sales. Beament attributed the result to increased production and sales volumes, including a 36% increase in copper concentrate and a 43% increase in zinc concentrate compared to the September quarter, driven by higher-grade production from the Kate Lens. Lead concentrate sales were down 29%, which he said reflected timing and the lenses being processed, and was “more than offset” by the increases in other concentrates.
Asked about head grades, Beament did not provide specific figures but said the increase in revenue and concentrate volumes implied “grades come up quite substantially,” with a larger contribution expected from the Kate Lens. He said the Kate Lens stope production quantum is expected to increase by a further 50% in the March quarter as ramp-up continues.
Beament also discussed treatment and refining charges (TC/RCs), which he said are falling across the base metals sector. He told the call that Develop has moved to a spot-based index for TC/RCs as of 1 January, noting copper and lead are trading “well into the negatives” and zinc treatment charges are at historical lows. Using “today’s spot commodity prices” and current TC/RCs, he said the company’s net smelter return revenue per tonne has increased 40% to about AUD 470 per tonne compared to the published restart assumptions in August 2024.
On the question of whether lower TC/RCs are locked in, Beament said Develop had fixed TC/RCs in calendar year 2025 under its Trafigura offtake agreement and moved to spot-based indices in calendar year 2026. He said the company was not yet quantifying the earnings impact, but indicated “significant savings” are expected.
CFO Ben MacKinnon said the strong revenue outcome was “mainly driven” by volume, though pricing also improved. He noted a large delivery of copper concentrate early in October fell into the December quarter after missing the September quarter. He also said realized copper prices are rising and that provisional pricing had an effect, referencing provisional copper pricing levels discussed on the call.
Exploration and drilling: new lenses and potential mine plan growth
Beament said Develop has only recently started drilling at Woodlawn, completing nearly 10,000 meters of grade control drilling. He said the second drill rig, intended to help grow the mine plan from an estimated 10 to 15 years, is scheduled to start later in the current quarter.
He added that grade control drilling intersected another lens referred to as the “N Lens,” with results outside current resources that he said could become a near-term mining area within the next three to six months. Beament also said the company recorded intercepts outside resources in the I and D lenses, and that ongoing drilling is finding additional mineralization.
Sulphur Springs: DFS update and resource expansion potential
Develop said Sulphur Springs progressed rapidly during the quarter. Beament referenced an updated definitive feasibility study (DFS) in the December quarter that delivered a pre-tax net present value (NPV) of AUD 921 million, a 76% increase versus the June 2023 study. He also noted that since the DFS assumptions were released, copper and silver spot prices were higher than the assumptions used in the DFS, while zinc was “around about the same” and roughly USD 100 higher at the time of the call.
Beament also discussed relative pricing between commodities, highlighting that zinc’s ratio versus copper and aluminum is at historical lows. He said that if spot commodity prices, exchange rates, and current treatment costs were applied to the October DFS, the pre-tax NPV would increase a further 25% to about AUD 1.15 billion.
In addition, Beament highlighted metallurgical and geotechnical drilling at Sulphur Springs that intersected high-grade mineralization. He cited a 204-meter intersection grading 1.8% copper, 0.6% lead, 6.2% zinc, and 21 grams per tonne silver, which he said aligns with the resource and mine plan grade. He said part of the interval—49 meters at 1.8% copper and 15% zinc with strong silver content—sits outside the current resource, and that the hole also intersected a “full ore lens,” opening a “whole new horizon” for the orebody.
Beament said Develop aims to grow Sulphur Springs from an eight-year to a 15-year mine plan and expects further drilling later in the year as underground development progresses. He stated that final investment decision is targeted for the June quarter of 2026.
Pioneer Dome and mining services: lithium opportunity and new contract
Beament said the recovery in spodumene pricing has changed the opportunity set at the company’s Pioneer Dome project, pointing to SC6 prices around $2,420 per tonne and a re-emergence of the direct ship ore (DSO) market. He emphasized that Pioneer Dome is a fully permitted mine with approvals and traditional owner agreements in place, and said it could deliver first DSO ore in less than six months. He cited a capital cost of about AUD 35 million to AUD 40 million to bring the project into operation.
During Q&A, Beament said the company is evaluating “all three options” at Pioneer Dome: mine-gate/toll treatment, building its own plant (noting that earlier scoping work indicated economics improved above $1,500 spodumene), and DSO sales. He said Develop had received term sheets from two large offtakers and had commenced discussions regarding access to Esperance Port, with logistics quotes being sought.
On mining services, Beament highlighted a second contract: a AUD 200 million tunneling contract with OceanaGold at the Waihi North Project in New Zealand. He described Waihi North as a high-grade, undeveloped gold project and said the award opens additional opportunities in New Zealand and Australia, with multiple tenders under assessment.
When asked about capacity for a third contract, Beament said Develop has bandwidth, equipment, and management depth, while noting labor conditions are tight across the sector and wage pressures are increasing. MacKinnon added that the company must balance staffing and resources between services work and its owned assets, particularly with the possibility of Pioneer Dome advancing.
Corporate update and outlook
Beament said group external revenue reached a record “nearly AUD 95 million” in the December quarter. He also said the company has been expanding its team and board, naming the appointment of Duncan Bradford as a non-executive director and adding senior hires in processing/metallurgy and business development.
Closing the call, Beament described the December quarter as potentially the “busiest quarter in the history of Develop,” and reiterated confidence in the company’s three-project portfolio and growing mining services division as it moves through its five-year plan.
About Develop Global (ASX:DVP)
Develop Global Limited, together with its subsidiaries, engages in the exploration and development of mineral resource properties in Australia. It primarily explores for copper, zinc, lead, silver, and gold deposits. The company also provides underground mining services. It holds interest in the Sulphur Springs project that includes Sulphur Springs and Kangaroo Caves deposits and tenements, as well as the Whim Creek Joint Venture project, located to the south east of Port Hedland; and the Woodlawn zinc-copper project is located at Lachlan Fold belt in New South Wales.
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