Fortescue Metals has confirmed that it is looking at record first-half earnings for the six months to December 31.
In its December quarterly production update yesterday the company reported shipments of 46.4 million tonnes for the three months to December quarter, up 9% on the previous corresponding period.
That took first-half shipments to a record high of 88.6 million tonnes, up around 9% on a year earlier.
Thanks to booming iron ore prices, it said average revenue stood at $US76 per dry metric tonne, 58% more than the same period a year earlier. BHP and Rio both reported average iron ore prices of around $US77 to just over $US78 a tonne.
It also reported C1 costs of $US12.54 per wet metric tonne, down 4 percent on a year earlier.
There was also good news for shareholders on guidance for the full year.
“Based on Fortescue’s strong performance in the first half, we expect shipments to be at the upper end of our guided range of 170 – 175 million tonnes and C1 cost guidance is lowered to a range of $US12.75 – $US13.25 per wet metric tonne,” Fortescue CEO Elizabeth Gaines said in yesterday’s statement.
That’s because the costs of production are being spread across more tonnes of output and sales.
Fortescue shares eased 2% to $11.29, well under the January 22 all-time high of $12.69. The continuing fears about the impact of the coronavirus crisis on Chinese demand for steel and iron ore remains a concern for the market.
The surge in cash through the company saw the net debt tumble to just $700 million at the end of the quarter with cash on hand of $US3.3 billion and gross debt of $US4 billion.
