The 2021 commodities boom emerged nicely in the annual results of Mineral Resources yesterday.
The company is a big lithium and iron ore player and it beat market expectations with a 230% increase in post-tax profit and a fully franked final dividend of $1.75.
That took total dividends for the year to $2.75 a share.
MinRes revealed underlying post-tax profit of $1.1 billion, but statutory profit was higher at $1.3 billion after revenue jumped 76% to $3.734 billion for the year.
This included $33 million of impairment charges.
In the 76% rise in revenue for the year, the company’s mining services business saw a 20% lift in volumes as iron ore and spodumene (lithium ore) exports both surged 23% compared to the 2019-20 financial year.
The mining services business strong performance was primarily driven by growth in operations at the Yilgarn and Utah Point iron ore mining hubs in WA. This was in addition to new external contracts.
Iron ore exports totalled 17.274 million wet metric tonnes and the surge in global prices helped produce an underlying net profit after tax of $1,100 billion – an increase of 230%
While the Platts Iron Ore 62% Fines Index rose 66% to an average of $US155 a dry metric tonne, thanks to the surge in January-May. Prices are down more than 25% since June 30 as Chinese government moves to cut carbon emissions force the steel industry to cut production and use less iron ore
But on the other hand, the average realised price for lithium spodumene was $535 a dry metric tonne, down 13% from the previous year.
Mineral Resources had cash on hand of $1,542 million at June 30.
This was despite the miner pouring $745 million into investments for growth into the future such as the development of the Wonmunna mine for the Utah Point hub, increasing Yilgarn Hub production, and new external mining services plants to support new contracts.
MinRes shares rose 0.16% to $60.31.
