RMS has released an updated mine plan for Mt Magnet, which has resulted in lower production and higher costs and capex vs our forecasts. The planned expansion of the process plant was smaller than we had anticipated while the capital costs of the pre-strip for Eridanus was materially higher than we had forecast. Compounding this, ore feed grades were also lower than we expected through to FY31, largely due to the profile of Eridanus. We have adjusted our forecasts for Mt Magnet to match the updated mine plan, which has translated to material cuts to our production and earnings forecasts for RMS. The company is now heavily reliant on securing the approvals for Rebecca / Roe to sustain group production over 200koz. We believe approvals for Rebecca / Roe are likely to take longer than anticipated which will see group production fall to ~120koz in FY28. We cut our price target 26% to A$2.60 and downgrade our rating from Buy to HOLD.
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