Pinned straw:
There is gold>>
Net profit for the consolidated Group after income tax for the year ended 30 June 2025 was $237.0 million (30 June 2024: $5.4 million loss). The current period results include an unaudited underlying EBITDA1 of $619.4 million (FY24: $192.7 million).
Highlights of FY25 include:
• Full year FY25 gold sales of 385,232 ounces generated revenue of $1.43 billion. The Group posted a gross operating profit of $319.7 million
• Repayment and termination of the Red 5 project finance facility, and associated restructure of the hedging facility
• Delivery the King of the Hills process plant re-engineering study to increase throughput, reliability and lower costs under a two-stage expansion program to 7.5Mtpa
https://hotcopper.com.au/threads/ann-appendix-4e-and-fy25-annual-financial-statements.8722156/
Return (inc div) 1yr: 27.03% 3yr: 20.29% pa 5yr: 10.33% pa
I don't follow Vault closely @raymon68 because I dislike their CEO & MD, Luke Tonkin, not to be confused with the very capable and affable Stuart Tonkin over at NST. Stuey I do rate. Luke, I do not. But I'll say the following about Vault Minerals:
(1) They have relatively high costs - as you can see in the second line of that table - the "Cost of Sales" line - so lower cost producers like RMS are making more money than Vault even though Ramelius are currently producing less gold (RMS around 300 Kozpa and VAU about 380), plus RMS have just bought Spartan and will be producing more gold than Vault within 3 or 4 years I'd reckon. Point being there are plenty of lower cost producers out there than Vault. It's not that Vault don't make money, they do. Just that the lower cost producers make MORE money for every ounce of gold they produce.
(2) Vault are currently expanding their KOTH mill significantly - and while I like that GNG are doing that work for them (I hold GNG), I understand that a higher cost producer like Vault that is going through a few years of significant capex (next couple of years) isn't going to be reporting well during that period compared to lower cost producers who have lower capex and opex spends.
(3) Luke Tonkin is a dipstick and much of what he does seems to be mostly designed to piss off Raleigh Finlayson at Genesis Minerals, so I don't rate Luke highly as a capable manager who makes sensible capital allocation decisions. A couple of years ago, Luke put in multiple bids to try to slow down or scuttle the deal between St Barbara and Genesis that finally went through and delivered Gwalia and all of SBM's Leonora assets to Genesis who already had assets of their own in the same area, and it didn't make much sense for Luke to be doing that because Luke was running Silver Lake Resources at the time and SLR had zero assets in that area - they had Mount Monger, approximately 580 km north-east of Perth and 50 km south-east of Kalgoorlie and the Deflector Gold-Copper Operations, located approximately 450 km north of Perth and 160 km east of Geraldton, within the Midwest Region of Western Australia, plus the Sugar Zone Gold Project in Ontario, Canada.
After losing that battle, Luke organised a reverse takover of Red 5 (RED) who did have assets around Leonora including their KOTH (King Of The Hills) mill and gold mine. It was a reverse takeover because RED being the slightly larger company acquired SLR and then Luke Tonkin from SLR ended up running the new company and renaming it Vault Minerals (VAU). Everybody who had previously been in a management position at RED either left the company at the time of the merger or within one year of the merger, leaving the old SLR team running Vault.
It was also rumoured that Luke structured the merger that way to stop Ral at GMD from blocking it by acquiring more than 10% of the target company, which Ral probably would have done if SLR was trying to takeover RED, but while Raleigh would love to have owned RED, he was not in the least bit interested in owning any part of SLR and their assets south of Kal and up in the Murchison/Mid-West of WA (and in Ontario, Canada), so as expected he did not acquire SLR shares to try to block that merger with RED. The main reason why GMD never made an official bid for RED was Price: Because it was obvious to everybody that RED was on GMD's radar, RED had an M&A premium in their share price, so were basically expensive compared to their peers. And Ral is a smart operator and does not like to overpay for assets, no matter how good they would be as part of the Genesis' stable of tenements, mines and mills. Even now, Genesis owns the tenements directly north, east and south of Vault's KOTH mill, with Vault only owning land directly to the west of KOTH. The natural owner of KOTH is clearly Genesis but as long as Luke Tonkin is running Vault, that deal may never happen.
However Luke Tonkin WAS prepared to pay overs to get hold of RED and he did that via that merger to create Vault.
Which is all to say that not everything that Luke Tonkin does is always in the best interests of ordinary retail shareholders of the companies that he manages.
Not saying Vault isn't going to be a good investment. A rising gold price tide is likely to lift all boats, even one with a drunken halfwit at the helm, but I personally prefer other opportunities in the sector. If Vault becomes very cheap, which could happen during the next couple of years due to their large capex spend and high costs, then it might be worth a punt, and Ral might get interested in making a bid, but that ain't now, not in my mind anyway.
No @Stevie_B I don't mind you asking at all. I added VAU to my SMSF yesterday and I'm planning to add it here tonight if my sells go through.
I was watching the most recent Money of Mine (MoM) podcast on Youtube two days ago and Trav reckons the merger between Vault (VAU, formerly SLR) and Genesis (GMD) is closer now than ever, especially after Luke Tonkin announced his retirement and there wasn't any succession plan mentioned at their recent AGM that Trav and JD attended (they also attended the GMD AGM), because perhaps VAU don't need to replace him if the two companies are likely to merge soon.
We know that there have been talks between the two companies for over a year however there is no love lost between Ral and Luke since Luke tried to scuttle Ral's acquisition of St Barbara a couple of years ago and then tried to scuttle Ral's acquisition of St Barbara's Leonora assets (the main ones being the 2km deep Gwalia mine and the Gwalia mill which Genesis do now own and call their Leonora Mill and Gwalia Mine).
The sticking points that likely stopped any merger talks proceeding through to an NBIO stage in the past 18 months were most likely (1) price, i.e. Luke reckoned the market wasn't appropriately valuing Vault so he wanted a higher premium than Ral would agree to, (2) the fact that the two men don't like each other very much, and (3) that neither would want to work under or alongside the other and Ral isn't giving up being the head of his company and Luke probably felt the same, until now, because he's announced his retirement, saying he intends to step down "within a period of 12 months from August 2025." That announcement was made on the day they released their full year results in August.
One of Vault's directors, Ian Macpherson, also retired from the Board at their recent AGM and I don't think they've replaced him either.
Also they've just completed a 1 share for every 6.5 shares held share consolidation (sometimes called a reverse stock split) - so they are now trading around the $5/share mark, and GMD is now up around $6.70/share, so their respective share prices are looking a lot closer now than they were a week ago (pre-share-consolidation), which is better for Vault from an optics POV.
Remember that post share consolidation (i.e. now), all historical share prices (pre-consolidation) are adjusted up by the same percentage that the share count has been reduced by, so looking backwards we have to divide the prices by 6.5 to get the real prices on those days, prior to yesterday.
Interestingly, when Luke Tonkin (Vault's MD & CEO) announced he was going to step down and away from VAU back in August - see announcement below - as uploaded to the ASX on August 21st, the VAU share price rose +12% from $2.73 (previous day's close) to close @ $3.06. Sure, they also released their full year results that day, so that might have had something to do with it too, but clearly the market was NOT devastated by the news that prickly Luke was not going to be running Vault by the same time next year.
Source: Managing-Director-and-CEO-Succession.PDF
Further Reading: https://www.australianmining.com.au/tonkin-departs-as-vault-marks-first-year-of-operations
So I'm thinking that the stars are starting to align now for a GMD/SLR merger, which would be effected via GMD acquiring SLR and Ral continuing to be in charge.
Apart from Luke announcing he is stepping down (that's the BIG change @Stevie_B) and another director retiring this month at their AGM, and VAU doing a buyback to get their share price up and the share consolidation, other stars that are aligning here include:
- GMD very recently announcing they've signed an agreement involving all stakeholders to shorten the Leonora rail line so it will end just short of Gwalia (the GMD mine, not the town) and will no longer run around their (GMD's) Gwalia (Leonora) mill and up through the middle of what is to become their Tower Hill high-grade open pit, so the biggest obstacle in developing Tower Hill will soon be removed. Currently it has an operating rail line running through it and that's going to be removed.
- Genesis would love to truck that Tower Hill ore to the King of the Hills (KOTH) mill just to the north of Tower Hill - and KOTH is currently owned and operated by Vault.
- KOTH is surrounded on three sides (North, East and South) by GMD tenements already - with VAU's tenements only to the west and the immediate south of their KOTH mill - see map below.
- Vault have recently transitioned to an owner-operator mining model at KOTH, rather than using contract mining companies as they had previously done, and that's what GMD already do across their operations (so do NST by the way), so there would not be a third party contractor involved if a GMD-VAU merger was to occur.
The main two changes are Luke Tonkin announcing he is leaving Vault and the VAU SP being high enough now that GMD doesn't have to offer a rediculous premium to get the VAU Board to agree to recommend the deal - so, yeah, there WILL still need to be a share price premium in the offer, but not as large in percentage terms as what the VAU Board would have been demanding when the VAU share price was substantially lower and probably reflected Vault trading at a discount to their peers then - probably a discount that Luke had earned, but a discount nevertheless.
Anyway - you can watch the lads talking about why Trav thinks the deal is closer than ever here: https://youtu.be/nEARzH-SzMo?t=1653
A number of my points that I've made above were stolen from Trav when I watched that pod. But not all of them - some were mine.
Hope that helps explain my change of mind. I'm still not a huge fan of Vault Minerals as a company but I am interested in this opportunity to get what I think is likely to become either more GMD shares or cash that would likely be worth more than what I'm paying for VAU shares this week.
To be honest, my main issue with Vault was their management, and various capital allocation decisions that Luke Tonkin had made in prior years, and now that he is leaving Vault, the company is starting to look a lot better - even if Genesis don't buy them. But I think Genesis will buy them.
One thing Luke has got right lately is the KOTH mill expansion - using GNG (who I hold). That is much wiser capital allocation than some of his M&A in prior years - and attempted M&A - not everything he tried to do panned out well.