New Hope Corporation is looking to a bonanza for its full 2021-22 financial year after reporting record revenue earnings and payout to shareholders yesterday as it rides the Vladimir Putin inspired coal price boom.
Even though the heat has gone out of prices in recent days with global prices down $US100 to $US200 a tonne, the NSW and southern Queensland miner will see an enormous surge in revenue in the half year ending July.
The record interim and prospects of more to come saw the shares up 10% at one stage on Tuesday to $3.22. They ended at $3.18, up 8.5%. That’s the highest close since early 2019.
New Hope said revenue in the six months to the end of January leapt 153% to $1.025 billion while underlying earnings before interest, tax, depreciation and amortisation (EBITDA) was up 582% to $554.4 million.
Net profit after tax of $330.4 million, compared to an interim loss of $55.4 million a year earlier
Shareholders not only get a fully franked interim dividend up 325% to 17 cents a share but a special dividend of 13 cents a share fully franked.
The surge in revenue and earnings came from a more sedate 7.1% rise in sales volumes to 5.1 million tonnes, a reduction in cash costs, and a 147% lift in its realised price to $192.4 a tonne. the closing price at January 31 was more than $236 a tonne.
New Hope CEO, Rob Bishop, was (understandably) pleased with the half and believes the company is well-positioned to continue generating strong, sustainable shareholder returns.
He said this was down to higher demand for high quality, lower emissions thermal coal which is expected to remain robust in the short to medium term as supply remains constrained.
Commenting on the half, he said: “Cost control disciplines that were introduced during the 2021 financial year in response to a period of depressed prices have been embedded across the Group and will ensure that New Hope remains in the lowest cost quartile compared to other producers of seaborne thermal coal.”
“Bengalla dealt very well with the challenges from COVID-19 related labour shortages and wet weather to minimise the impact on coal production, which was down only 1 per cent compared to the first half of last financial year. The mine will shortly take delivery of two additional haul trucks which will increase saleable production during the second half of the financial year.”
“Strong demand and lower than normal stock levels held by customers have pushed thermal coal prices well above the long-term average. Newcastle Index pricing is currently above US$300/tonne, and our forward sales book will support robust returns,” Bishop added.
