The Northern Star Resources Ltd (ASX: NST) share price is slumping today.
Shares in the S&P/ASX 200 Index (ASX: XJO) gold stock closed yesterday trading for $16.67. In morning trade on Thursday, shares are changing hands for $16.20 apiece, down 2.8%. For some context, the ASX 200 is up 0.2% at this same time.
This follows the release of Northern Star's June quarterly update.
Here's what's happening.
Northern Star share price slides on rising costs
Investors are pressuring the Northern Star share price despite the miner reporting record annual underlying free cash flow of $536 million and net mine cash flow of $1.19 billion.
Full year FY 2025 gold sold came in at 1.634 million ounces at an all-in sustaining cost (AISC) of $2,163 per ounce. That falls within Northern Star's revised full year guidance range.
Estimated FY 2025 cash earnings are in the range of $2.80 billion to $2.95 billion. That's up from $1.81 billion in FY 2024.
But Northern Star shares could be under some pressure with the miner noting, "All-in costs (AIC) of A$3,352/oz were higher than a year ago as capital growth projects continued across the Group, led by the KCGM Mill Expansion Project."
As for the June quarter, the ASX 200 gold stock sold 444,000 ounces of gold at an AISC of $2,197 per ounce (US$1,408/oz).
The miner said that both its Yandal and Pogo mines delivered record quarterly and annual net mine cash flow.
At the end of the quarter, Northern Star held net cash of $1.013 billion after its De Grey acquisition. The miner reported cash and bullion holdings of $1.914 billion.
What did management say?
Commenting on the results that have yet to lift the Northern Star share price today, managing director Stuart Tonkin said, "The June quarter completes a constructive year of growth investments to position our largest asset, KCGM, for sustained future success."
Tonkin added:
We remain committed to unlocking the full potential of our production centres and are confident the investments made during FY25, including the acquisition of the Hemi deposit, will deliver significant value for shareholders.
For FY25, our Team safely delivered our revised guidance, which included new milestones of 1.63Moz gold sold and net mine cash flow of A$1,189 million. With the KCGM Mill Expansion Project well advanced and tracking to plan, we will wind down our gold price hedging, reflecting the confidence in our outlook and balance sheet.
What's ahead for the Northern Star share price?
Looking to what could impact the Northern Star share price in the year ahead, the ASX 200 miner's guidance for FY 2026 is for 1.70 million to 1.85 million ounces of gold sold at an AISC of $2,300 to $2,700 per ounce.
FY 2026 growth capital guidance is in the range of $2.125 to 2.270 billion, which includes the KCGM Mill Expansion and Operational Readiness, and the Hemi Development Project.
Full year exploration guidance is at $225 million.
The miner said its KCGM Mill Expansion is now in its final build phase year. The project remains on schedule.
"With an increased focus on productivity and cost control, we are well positioned to responsibly and profitably grow our production footprint and cash flow margins," Tonkin said.
With today's fall factored in, the Northern Star share price is up 13.4% over 12 months.
