New Hope Group, a coal mining company, has released its financial results for the half year ended 31 January 2024. The company reports strong financial performance despite a decline in coal prices.
Highlights:
- Saleable coal produced increased by 28% to 4.1 million tonnes (Mt), with the first coal sold from New Acland Stage 3 during the period.
- Underlying EBITDA (earnings before interest, tax, depreciation and amortization) was $424.8 million, down from $1,038.5 million in the same period last year.
- Net profit after tax was $251.7 million, down from $668.6 million in the same period last year.
- Net cash from operating activities was $130.6 million, down from $983.5 million in the same period last year. Available cash was $480.4 million, including $184.3 million of fixed income investments.
- Free on Rail cash costs (excluding New Acland while in ramp-up) were $68.1 per tonne, an increase of 4% year-on-year. This increase is attributed to disciplined management of controllable costs.
- A 2024 interim dividend of $143.7 million, representing 17.0 cents per ordinary share, will be paid to shareholders on 1 May 2024.
New Hope Group CEO Comments
The company’s Chief Executive Officer, Rob Bishop, attributed the strong financial performance to consistent operational performance, targeted organic production growth plans, and disciplined cost control. He also highlighted the following:
- The Bengalla Mine’s 13.4 million tonnes per annum (Mtpa) growth project is on track ahead of schedule, with unit costs expected to decline as production increases in the second half of the financial year.
- During the half, New Hope acquired the West Muswellbrook Assessment Lease (AL19) and progressed exploration work at its Exploration Lease area (EL9431). Both these acquisitions are located near the Bengalla Mine and are said to provide long-term optionality for the company.
- Despite legal challenges surrounding New Acland, the mine was able to start production and sell coal during the period. The mine also added 36 new local employees.
- New Hope increased its interest in Malabar Resources, an investment that is said to lift the company’s exposure to metallurgical coal and provide attractive returns to shareholders in the coming decades.
- New Hope believes its low-cost coal assets and targeted organic growth will position the company well to take advantage of the expected demand for high-quality coal during the energy transition.
- The company’s performance during the half demonstrates its resilience to price volatility and the potential of its growth pipeline.
Overall, the financial results show that New Hope Group is a financially sound company, despite the decline in coal prices. The company is well-positioned for future growth with its expansion plans and investments in low-cost coal assets.
By: TheCoalTrader, AI generated
