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Thank you for joining today's teleconference for the release of the Mount Gibson Iron's June quarterly activities report. Mount Gibson Chief Executive Officer, Peter Kerr, will be leading the discussion and is joined by Chief Financial Officer, Gill Dobson; and External Relations Manager, John Phaceas. Mr. Kerr will provide a brief overview, after which there will be an opportunity to ask questions.
Due to the time constraints, only institutional participants will be invited to ask questions at that time. A recording of the call will also be available via the Mount Gibson website shortly after the completion of today's teleconference.
Thank you, and go ahead. Thanks, Peter.
Thanks, Lisa. Good morning, all, and thanks for joining us to discuss Mount Gibson's June quarter report. As usual, I'll give a brief overview before handing back to Lisa for any questions from the floor.
June quarter was a positive one for us on most measures, as you may have seen, and delivered Mount Gibson a stronger finish to the financial year. As expected, Koolan Island has, after a challenging period of capital investment projects, now been positioned for significant increases in high-grade ore sales and cash flows for the coming years.
Ore sales trebled in the June quarter to 713,000 wet metric tonnes at an average grade of 63.6% iron, and that represented over half of the total year's shipments from the operation. Overall, we finished the year with group ore sales of 1.65 million tonnes, which comprise 1.35 million tonnes from Koolan and 0.3 million tonnes from the Mid-West Shine operation.
Shipments of 65% iron from Koolan Island commenced during the month of June, and the grades are now consistently around that level. We're now shipping 3 to 4 shipments per month, which we consider to be the baseline rate going forward for the next little while.
In accordance with the Koolan mine plan, the waste to ore stripping ratio substantially reduced to an average of 5.6:1 in the quarter, and that included the rehandle of historical backfill material. And that's on track to further reduce in the new financial year.
So as a result, the business generated an operating cash flow of AUD 32 million in the quarter, which was a turnaround from the cash outflow of AUD 38 million in the prior quarter. However, we do point out that with reductions in the iron ore price since the end of the quarter and given that our offtake contracts have a future-month price basis, we often sell on N+1 and N+2 turns.
We expect some downward provisional pricing adjustments, and these are currently estimated at approximately AUD 26 million net of royalty savings. The final number of that adjustment will be reflected in our annual financials, and it will obviously depend upon near-term iron ore prices. So the group's cash and investment reserves increased by $33 million to $126 million in round numbers as at 30 June, up from $92 million at the end of March.
Turning to Koolan Island now in a little more detail. Firstly, regarding safety, we're very pleased to see a good improvement in the group's injury frequency rates, and these largely reflect Koolan but also some of our Mid-West people as well. And that's where the rolling 12-month lost time injury frequency rate reduced from 1.7 injuries per 1 million hours worked at the end of March to 1.3 at the end of June. So we've come down under the industry standard, which sits at about 1.7. In addition, the total reportable injury frequency rate also reduced from the March quarter of 13.3 to 11.4 at the end of June. So Koolan Island is a reasonably complex operation for its size, in particular, given the remote location, and it's pleasing to see these improvements with the safety initiatives that we have underway, led by the team on the site.
You may also have seen that the Koolan Island team, including our emergency response personnel, provided valuable assistance to the Royal Flying Doctor Service in the quarter in treating and facilitating the transport of 26 injured tourists following a serious boating incident at the nearby Horizontal Falls site. So our people are congratulated on their efforts there.
In relation to mining at Koolan, total material movement in the quarter increased 17% to 4.4 million tonnes, and the ore quantity doubled to just over 660,000 tonnes. All production rates have been building steadily since we regained access to the high-grade ore zones in the Main Pit in the March quarter. And this improved again throughout the June quarter as the bulk overburden stripping and upper footwall ground support programs near the completion.
Consequently, the waste stripping ratio continued its decline as planned. It was over 17:1 in the December half year. And in the June quarter, it has come down to 5.6:1. From here, we expect the stripping ratio to reduce further. So in the 2022-'23 financial year ahead, we anticipate it to be approximately 3.5:1, which will be made in the first half and reducing to 1:1 in the second half. So overall, a strip ratio of about 2:1 for the year. That's really important for our costs given the unit cost nature of the operation.
The quality of the ore has also improved in line with the mine plan. The average sales grade increased from 62.8% Fe in the previous quarter to 63.6% Fe in June quarter. And during the month of June, we commenced shipping 65% Fe material and are now dispatching cargoes consistently at that level.
In relation to cash operating costs, like all producers, we've seen considerable pressures particularly for diesel fuel, labor, COVID absenteeism, various logistic items and also, from a revenue perspective, shipping freight to China. Through increases in mined volumes and a number of productivity and cost savings initiatives as well as reasonably good control over COVID absenteeism, in relation to that, that peaked at about 15% in May and is now under 5%. And we're obviously watching that very carefully.
But as a result of those measures, we've worked hard to mitigate the increases in cost as much as possible. So our unit mining, logistics and administration costs, which includes all transport charges for the remote operation, increased to $12.49 per tonne of ore and waste mined in the quarter compared with $12.07 per tonne in the prior quarter, and that was about 3%.
Unit cash costs per tonne sold, obviously going to be sensitive to the volumes that we ship, reduced quite considerably to AUD 77 per tonne FOB for the quarter, and that was before royalties and the 2 key capital projects. And we're expecting to decrease -- have our cost decrease from here as well as our shipment volumes increase.
In terms of key capital projects on the island, the major capital items undertaken in the fiscal '22 have been either completed or are nearing completion. And this includes the overburden stripping program and the upper footwall ground support program and also the crusher upgrade project. The footwall ground support program in particular, it's now complete, and that has facilitated the reestablishment of safe mining access to high-grade zones in the pit floor in the Western half of the pit below those footwall levels.
Turning now to our Mid-West business, just a couple of comments. The Shine operation remains on low-cost care and maintenance. And we are continuing to monitor market conditions for potential restart, although that's obviously proving challenging with where iron ore prices have moved recently, although we do see discounts for the medium-grade materials condensing at the moment. The focus of our activities presently is on income generation through the use by third parties, iron ore and other groups, of Mount Gibson's existing storage shared rail sidings and other site infrastructure.
We also continue to receive the historic rail credit refund, and that's based on the use by third parties of certain parts of the Mid-West rail network. And that refund is currently accruing at approximately $2 million per quarter and is paid 6-monthly. Mount Gibson has received $24 million to date, and the cumulative total cap of that refund is around $35 million, subject to indexation.
In relation to exploration activities, initial work has commenced in the Mid-West region near the company's former Tallering Peak mine site, where we see attractive prospectivity for base metals in a number of locations. So this is preliminary work, and drilling has recently commenced, so we'll have some information flows on that in due course.
Now just stepping back and talking about the financial side, realized pricing and cash flow. All sales revenue totaled AUD 120 million FOB in the quarter. We report our revenue on FOB terms. And the Koolan Island fines average price realized was USD 122 per tonne FOB, and that was after penalties and shipping freight charges. And the shipping freight in the quarter averaged around USD 20 to USD 22 per tonne transported from Koolan to Northern China. This realized price compared with USD 81 per tonne in the March quarter and reflects, amongst other things, the increasing grade shipped during the period.
However, as I noted at the start, with reductions in the iron ore price since the end of the year, we expect a reasonable downward provisional pricing adjustment, and that's currently estimated to be in the order of AUD 26 million net of the royalty savings. The final adjustment will be reflected in our annual financials, as I mentioned. In any case, though, given the high-grade nature of the Koolan ores, at current prices, the operation's shipment values and cash flows remain very attractive. And for example, a shipment of Koolan Island fines grading 65% Fe is presently worth about AUD 10 million FOB. So obviously, we're seeking to take advantage of this price as best as we can with our increasing shipping volumes.
Group cash flow for the June quarter before the provisional pricing adjustment I mentioned above totaled $32 million, and that comprised Koolan Island's operating cash flow of $34 million, interest and other income of $5 million and then net corporate foreign exchange exploration and site holding and rehabilitation outflows of $7 million after a working capital inflow of $1 million, just reflecting the timing of payments and receipts. This resulted in an increase of $33 million in the company's cash and investment balance over the quarter. As a result, our cash and investment balance totaled $125.6 million at the end of June.
So in summary, June quarter was a positive one on most measures and demonstrates that we've turned the corner at Koolan obviously after a lengthy and challenging period of some key investments. A significant improvement in operating and financial performance is anticipated over the coming fiscal '23 financial year as production volumes, ore quality and shipment numbers improve and our unit cash costs decline in line with the reduced stripping ratio.
So with that, I'll finish up and hand back to you, Lisa, for any questions that business may have. Thank you.
[Operator Instructions] Jon, for our first question, I didn't quite catch your surname, if you could just say it, from Macquarie.
Yes, Jon Scholtz from Macquarie. Yes, it seems like we're turning the corner on the advanced stripping, getting into it now, so there should be some good cash generation of the remaining life of mine. Just trying to pick your brain again on what do you see the use of cash going to be once this generation comes in. Is there going to be an update to the dividend strategy or are you looking actively at the M&A market right now?
Probably a combination of both, Jon. We are -- now that we have reached this point with Koolan, we are actively looking at a range of M&A activities. I can't obviously talk about those. We hold a few small positions in companies that are in the base metal space, where we're focused, so we'll see how that goes. But obviously, the desire from the Board at this point is to build the Koolan cash flows and use that cash position to undertake some acquisitions. So really, we're now at the start given we're just turning around with Koolan.
In terms of dividends, that will be considered at the August Board meeting, so by the Board. And we'll see where that sits. It's obviously been a pretty tough year, but that will be part of the consideration of the future cash flow generation.
[Operator Instructions] Okay. Peter, we have no further questions.
Okay. Thanks, Lisa. All right. Well, thank you all for listening in. If you do have questions or any follow-up queries, then you please contact John Phaceas at Mount Gibson. It's on our release. And have a good day. Thank you.