Westgold's production growth plan survives a gold price correction

After more than doubling through 2025 on the back of soaring gold prices, Westgold Resources gave back some of those gains in mid-2026 — a pullback most fund managers who hold it are treating as a market event, not a company problem.

30 Jun 2026 · 6 min read

Westgold Resources Ltd (ASX: WGX) spent much of 2025 as one of the standout performers in the gold sector, before giving back some of those gains as bullion pulled back from record highs in mid-2026. Tectonic Investment Management, which had built a position across a basket of resource holdings, reported in June 2026 that Westgold's share price declined 21% over the quarter as the gold price underwent a significant correction after reaching an all-time high of more than USD 5,590 an ounce in late January. Even so, the fund said Westgold "continued its run of consistent quarterly production above 100,000 ounces, maintaining a debt-free balance sheet and a strong cash position."

We view the current pullback as a function of the broader gold price correction rather than any deterioration in the company's operating performance, and retain our conviction in Westgold as a high-quality, well-managed exposure to the gold sector.

Tectonic Investment Management, Quarterly Report, June 2026

A production ramp with more upside not yet in guidance

The core of the bull case has centred on Westgold's transformation from a mid-tier producer into one of scale. L1 Capital highlighted in September 2025 that the company's three-year outlook, released after quarter end, showed FY25 production of around 325,000 ounces expected to grow toward roughly 470,000 ounces by FY28, and argued there was significant medium-term upside to grow that number further. By December 2025, L1 was pointing to a specific reason why: the newly discovered Fletcher Zone at Beta Hunt, which the fund said is "potentially transformational for the scale of the asset" and is not yet included in the FY28 target.

Oracle Advisory Group made a similar point in its own December 2025 coverage, noting Westgold sits among the top five gold producers in Australia and has "outlined how it will expand its current producing assets to meet this target and has confidence in doing so." Yarra Capital Management, tracking the same growth plan from an underweight position, added detail on costs in October 2025, noting the company's plan also involves lowering all-in sustaining costs to around $2,500 an ounce as production scales.

We believe there remains significant medium-term upside to grow production further, as these targets do not include any contribution from the newly discovered Fletcher Zone at Beta Hunt, which is potentially transformational for the scale of the asset.

L1 Capital, Quarterly Report, December 2025

Not every manager has been convinced

Despite the operational momentum, Yarra Capital Management and Paradice Investment Management have both stayed underweight or unowned through the rally. Yarra has repeatedly said it sees "better value in peers Genesis Minerals, Vault Minerals and Bellevue Gold," a position it held through October and December 2025 even as Westgold outperformed. Paradice took a different route, noting in December 2025 that it held no position in Westgold at all despite an overweight to the broader precious metals sector, which meant the stock's strong share price performance and large index weight worked against the fund's relative performance during the quarter.

Tier-1 jurisdiction exposure draws in new buyers

Other managers have used the gold rally to add Westgold as a straightforward, low-risk way to gain leverage to bullion. Tectonic Investment Management swapped its gold sector exposure from Perseus into Westgold, a switch that by December 2025 had delivered an 84.5% gain compared with Perseus's roughly 49% over the same period, which the fund attributed partly to the safety of Westgold's all-Western Australian asset base across Fortnum, Meekatharra and Cue. Akambo added Westgold to its portfolio in January 2026, funding the position by selling down its Gold ETF holding on the view that unhedged producers with production growth should outperform the metal itself. Not every manager stayed the course through the volatility, however; LSN Capital Partners exited Westgold that same month as part of a broader reduction in Materials sector exposure.

What comes next

With the June 2026 correction now behind it and quarterly production still holding above 100,000 ounces, the debate among fund managers has settled into two camps: those who see the pullback as a buying opportunity into a growing, debt-free, Tier-1 jurisdiction producer, and those who continue to find better value in Westgold's smaller-cap gold peers. The Fletcher Zone discovery, and how much additional scale it adds to the FY28 production target, is the catalyst both sides are watching next.