Reach Resources Limited (RR1) AI Stock Analysis

• Market Cap: AU$10.49M
• Dividend Yield: N/A
• Average Volume (3M): 2.77M
• Price to Earnings (P/E): ―
• Beta (1Y): 0.63
• Revenue Growth: N/A
• EPS Growth: -136.67%
• Country: AU
• Employees: N/A
• Sector: Basic Materials
• Sector Strength: 58
• Industry: Gold
• EPS (TTM): >-0.01
• Shares Outstanding: 874,431,340
• 10 Day Avg. Volume: 2,774,501
• 30 Day Avg. Volume: 2,767,016
• PEG Ratio: 0.05
• Price to Book (P/B): 0.50
• Price to Sales (P/S): 0.00
• P/FCF Ratio: -2.55
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: N/A
• Price Target Upside: N/A
• Rating Consensus: N/A
• Number of Analyst Covering: 0
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 45 Neutral
• Price Target: AU$0.01 ▲(20.00% Upside)

The score is primarily held back by weak financial performance driven by unstable earnings and consistently negative operating/free cash flow despite a cleaner balance sheet. Technicals are broadly neutral with only modest support from trading above key moving averages, and valuation signals are constrained by a negative P/E and no dividend yield data.

Positive Factors

Low Leverage

Zero reported debt provides durable financial flexibility for a cash‑burning explorer. A debt-free balance sheet reduces insolvency risk, supports continued exploration spending or JV negotiations, and lowers fixed financing costs over the medium term.

Exploration Asset Model

An asset‑based exploration model offers asymmetric upside from successful discoveries and enduring optionality from tenement portfolios. Over 2–6 months this supports value accretion via drilling success, farm‑outs, or strategic disposals rather than relying on short‑term sales.

Stronger Equity Base

Material equity growth strengthens the company's capital base, improving its ability to fund exploration without excessive leverage. A larger equity buffer supports longer project timelines and enhances credibility with partners and regulators.

Negative Factors

Persistent Cash Burn

Consistent negative operating and free cash flow forces ongoing external funding, increasing dilution or reliance on partners. Over months this constrains autonomous project advancement and raises execution risk if capital markets tighten or partner interest wanes.

Revenue Volatility

Extreme revenue swings, including a drop to zero, indicate no stable commercial revenue stream. This undermines predictable funding capacity and makes long‑term project planning and lender/partner underwriting more difficult for an explorer.

Unstable Profitability

One standout profitable year amid multiple loss years signals weak earnings quality and inconsistent margins. Sustaining returns is uncertain, which elevates cost of capital and complicates assessments of long‑term project economics and management track record.

Reach Resources Limited Business Overview & Revenue Model

Company Description

Reach Resources Limited engages in the exploration and evaluation of mineral resource projects in Australia. The company primarily explores for gold, as well as for nickel, cobalt, copper, and base metals. It holds interests in the Primrose gold project located in the northeast of Perth. The company was formerly known as Cervantes Corporation Limited. Reach Resources Limited was incorporated in 2001 and is headquartered in Perth, Australia.

How the Company Makes Money

Reach Resources Limited makes money through the exploration and development of mineral resources, with the primary revenue streams coming from the sale of mineral products extracted from their projects. The company undertakes exploration activities to identify viable mineral deposits, which are then developed into operational mines. Revenue is generated from the sale of minerals extracted from these sites. Additionally, Reach Resources Limited may engage in partnerships or joint ventures with other mining companies to leverage expertise and share costs, potentially enhancing revenue through shared profits or royalties. The company's financial performance is influenced by factors such as mineral prices, exploration success, and the efficiency of mining operations.

Reach Resources Limited Financial Statement Overview

Summary

Reach Resources Limited exhibits strong profitability with impressive revenue growth and high profit margins. The balance sheet is robust with no debt, promoting financial stability. However, negative free cash flow indicates cash management challenges that need to be addressed to ensure sustainable growth.

Income Statement

The company has shown impressive growth in revenue, with a significant increase from past years, leading to a strong gross profit margin of 99.51% for TTM. The net profit margin is also robust at 62.28%, reflecting effective cost management. EBIT and EBITDA margins are high, indicating operational efficiency. The revenue growth trajectory is positive, indicating strong market performance and potential for future growth.

Balance Sheet

The balance sheet is strong with zero debt, leading to a favorable debt-to-equity ratio of 0. Return on Equity (ROE) is high at 13.91%, reflecting effective use of equity to generate profits. The equity ratio of 98.90% signifies a solid capital structure with low liabilities, enhancing financial stability. However, the reliance on equity might limit financial flexibility.

Cash Flow

The cash flow position presents challenges, with negative free cash flow indicating cash outflows exceeding cash inflows from operations. The operating cash flow to net income ratio is negative, suggesting cash flow issues despite reported net income. The free cash flow to net income ratio is also negative, highlighting the need for improved cash management strategies to support sustainable growth.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	0.00	0.00	3.20M	0.00	100.00K	29.65K
Gross Profit	-11.98K	-11.98K	3.20M	0.00	100.00K	29.65K
EBITDA	-1.15M	-1.15M	1.92M	-943.87K	-451.49K	-323.00K
Net Income	-950.30K	-950.30K	1.94M	-2.66M	-451.00K	-343.00K
Balance Sheet
Total Assets	14.23M	14.23M	15.02M	6.55M	6.08M	3.95M
Cash, Cash Equivalents and Short-Term Investments	3.27M	3.27M	6.01M	1.23M	1.13M	2.04M
Total Debt	0.00	0.00	0.00	450.00K	450.00K	450.00K
Total Liabilities	249.15K	249.15K	338.86K	524.55K	555.45K	489.65K
Stockholders Equity	13.98M	13.98M	14.69M	6.03M	5.53M	3.46M
Cash Flow
Free Cash Flow	-2.74M	-2.74M	-4.77M	-1.61M	-1.34M	-934.79K
Operating Cash Flow	-786.07K	-786.07K	-950.79K	-867.37K	-489.48K	-728.89K
Investing Cash Flow	-1.95M	-1.95M	-617.16K	-881.34K	-2.62M	154.43K
Financing Cash Flow	-4.17K	-4.17K	6.35M	1.84M	2.21M	2.46M

Reach Resources Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
Sector *	61 Neutral	$10.43B	7.12	-0.05%	2.87%	2.86%	-36.73%
GA8	48 Neutral	AU$37.79M	-8.92	-9.64%	―	626.10%	94.33%
KTA	46 Neutral	AU$11.27M	-2.17	-141.03%	―	-100.00%	36.11%
RR1	45 Neutral	AU$10.49M	-10.91	-6.63%	―	―	-136.67%
VKA	45 Neutral	AU$16.15M	-4.35	-41.19%	―	―	14.81%
FAU	37 Underperform	AU$18.35M	-25.00	-32.90%	―	―	42.86%

Reach Resources Limited Corporate Events

Reach Resources Completes RC Drilling at Murchison South Gold Project

Reach Resources Limited has completed a 48-hole, 5,281-metre reverse circulation drilling program at its 100%-owned Murchison South Gold Project, targeting areas within and adjacent to four conceptual open-pit designs. The campaign is aimed at upgrading portions of the existing Inferred Mineral Resource to the higher-confidence Indicated category to support potential open-pit development, while a concurrent rock-chip sampling program at Blue Heaven, Jacamar, Pansy, Shamrock and East Daffodil is assessing additional gold mineralisation along strike. All samples are now en route to Perth laboratories, with assay and metallurgical results expected in February, which the company says will underpin key decisions on the project’s next phase of work in 2026.

Reach Resources Secures New Mining Lease at Murchison South Gold Project

Reach Resources Limited has announced the granting of a new mining lease, M59/790, at its Murchison South Gold Project. This lease covers the Jacamar gold deposit, which is strategically located between the Blue Heaven and Pansy Pit deposits. The lease enhances the potential for significant mining operations in the area, with historical drilling indicating promising gold grades. The company is conducting rock chip sampling to assess surface gold and quartz vein exposure, which could further bolster its mining prospects.

Reach Resources Limited Announces AGM Results and Strategic Decisions

Reach Resources Limited announced the results of its Annual General Meeting held on November 13, 2025, where all resolutions were decided by a poll. Key outcomes included the adoption of the remuneration report, re-election of director Matthew O’Kane, and the approval to issue securities under an employee incentive plan, while the approval of the 7.1A mandate and replacement of the constitution were not carried. These decisions reflect the company’s strategic direction and governance priorities, impacting its operational framework and stakeholder engagement.

Reach Resources Launches Drilling at Murchison South Gold Project

Reach Resources Limited has commenced a 5,000-meter reverse circulation drilling program at its Murchison South Gold Project in Western Australia. The program aims to upgrade resource classifications from inferred to indicated and explore new mineralization zones, potentially enhancing the project’s resource inventory and strengthening the company’s position in the gold mining sector.

Reach Resources Advances Murchison South Gold Project with Promising Developments

Reach Resources Limited has made significant progress in its Murchison South Gold Project during the September 2025 quarter. The company has completed essential environmental and heritage surveys, with no significant impediments found for future mine development. They are advancing their scoping study, which includes pit optimization and metallurgical test work, showing promising gold recovery rates. The company plans to commence a 5,000-meter infill drilling program in mid-November to increase resource confidence and reduce project risk. This progress positions Reach Resources favorably in the mining sector, potentially enhancing their operational capabilities and stakeholder confidence.