Mid-tier gold producer and explorer Gold Road Resources (ASX: GOR) has released its activities report for the June quarter ending 30 June 2025, amidst progressing negotiations for a full takeover by Gold Fields (JSE: GFI).
Gold Road’s principal asset remains its 50 per cent stake in the world-class Gruyere gold mine, located in Western Australia’s north-eastern Goldfields.
The Gruyere mine is a 50:50 joint venture with Gold Fields, who manages and operates the mine.
Additionally, Gold Road holds a significant portfolio including approximately a 3.5 per cent stake in Northern Star Resources (ASX: NST), following its previous 17.3% holding in De Grey Mining, acquired by Northern Star.
A key corporate development was announced on 5 May 2025, when Gold Road entered into a Scheme Implementation Deed with Gold Fields, agreeing to be acquired entirely by Gold Fields through a scheme of arrangement.
Under this scheme, Gold Road shareholders will receive a fixed cash consideration of $2.52 per share, less any special dividend paid beforehand, plus variable cash consideration equating to their proportional interest in Gold Road’s Northern Star shareholding.
Gold Road also plans to declare a fully franked special dividend effective upon the scheme’s success, with the final dividend amount tied to the company’s franking account balance at that time.
The scheme is subject to approvals from Gold Road shareholders and customary conditions, with the board unanimously recommending that shareholders vote in favour of the scheme in the absence of a superior proposal and contingent on an independent expert’s positive report.
A scheme booklet providing details and the expert’s report is expected to be sent to shareholders in late August, with a shareholder meeting to approve the deal scheduled for late September and implementation anticipated shortly thereafter.
Regarding operations, the Gruyere mine produced 72,980 ounces of gold (100 per cent basis) in the June quarter at an all-in sustaining cost (AISC) of $2,928 per attributable ounce, up slightly from 71,226 ounces at $2,658 per ounce in the previous quarter.
Gold Road anticipates full-year Gruyere production will fall at the lower end of the guidance range of 325,000 to 355,000 ounces (162,500 to 177,500 attributable ounces), with AISC expected near the higher end of guidance at between $2,400 and $2,600 per ounce.
Financial highlights included gold sales of 37,741 ounces at a record average sales price of $5,131 per ounce and a reduction in gold doré and bullion on hand to 2,027 ounces as of 30 June.
Operating cash flow attributable to Gold Road from Gruyere reached $138.6 million for the quarter, up from $106.6 million in the March quarter, while free cash flow increased to $44.7 million from $34.1 million.
Despite increased costs, with Corporate All-In Cost rising to $3,542 per ounce for the quarter (from $3,058 in March), cash and equivalents rose to $242.1 million with no debt.
The market value of Gold Road’s listed investments was approximately $827.3 million as of 14 July 2025.
Exploration programs progressed positively, with the Gruyere diamond drilling program (~60,000 metres target) advancing well and returning results aligned with expectations for width and grade; approximately 23,000 metres have been completed year to date, with up to five rigs operational during the quarter.
Similarly, the Gilmour diamond and reverse circulation drilling program (~30,400 metres target) also showed promising results consistent with expectations.
This comprehensive quarterly update comes as Gold Fields moves to consolidate its ownership of the Gruyere operation, citing the acquisition as a strategically logical move to streamline decision-making and enhance its portfolio with a producing asset that offers immediate cash flow benefits.
Gold Road’s board supports the transaction, encouraging shareholder approval to realise the deal’s full value.
The forthcoming shareholder materials and meeting later this year will provide further clarity to investors as the scheme moves toward implementation.