Shares of Westgold Resources (ASX:WGX) tumbled 12.4% following the company's announcement of a significant reduction in its production guidance for fiscal year 2025. The mining firm reported that its anticipated output would be 17% lower than previously forecasted, a figure that also fell short of Macquarie and Visible Alpha consensus estimates by 13%.
The downward revision was attributed to slower than expected ramp-ups at its Beta Hunt and Bluebird operations. This deceleration is expected to impact not only the current forecast but also subsequent years, with a 10% cut in production projected for FY26 and an approximate 4% decrease in the following years.
Despite the scaled-back expectations, Westgold Resources still projects a 32% YoY increase in production leading into FY26, with the company aiming to reach a production rate of over 400,000 ounces per annum in the fourth quarter of FY25. However, this target is notably below market expectations, prompting concern from industry analysts regarding the company's future performance.
Macquarie analysts commented on the update, stating, "Despite MQe and VA expectations of a FY25 guidance miss, today's downgrade is material. The '>400kozpa' rate WGX anticipates in 4Q is also well below expectations and, in our view, raises questions on WGX's FY26E (MQe 450koz, VA 491oz) and ultimate production rates."
