PERTH (miningweekly.com) – Despite reporting record shipments in the half-year to December, iron-ore major Fortescue Metals has announced a 13% drop in revenue compared with the previous corresponding period, as iron-ore prices dropped.

Fortescue shipped 93.1-million tonnes of ore during the six months under review, up from the 90.7-million tonnes shipped in the first half of 2021, however, revenues declined from $9.3-billion to $8.1-billion in the same period.

C1 costs for the interim period also increased from $12.78/t to $15.28/t in the same period.

Underlying earnings before interest, taxes, depreciation and amortisation decreased by 28% in the six months under review, from $6.6-billion to $4.7-billion, while net profits after tax fell by 32%, from $4.08-billion to $2.7-billion.

“Fortescue’s performance for the first half of 2022 has been outstanding and we are proud of the entire team who have delivered record half-year shipments and contributed to net profit after tax of $2.8-billion, the third highest in Fortescue’s history,” said CEO Elizabeth Gaines on Wednesday.

“We have continued to reinvest in the business and invest in growth. Our major project, Iron Bridge is progressing well with first production scheduled in December 2022. We remain focused on managing industry cost pressures and challenges posed by Western Australia’s ongoing border restrictions, and we are working closely with the Western Australian government and relevant authorities to ensure we have access to the specialist skills required.”

For the full 2022, Fortescue is targeting iron-ore shipments of between 180-million and 185-million tonnes, with C1 costs to range between $15/t and $15.50/t, with the miner spending between $3-billion and $3.4-billion in capital.

“During the half, Fortescue Future Industries (FFI) continued to advance a portfolio of renewable energy and green hydrogen project opportunities, while growing its green technology capabilities. As Fortescue continues its transition to a vertically integrated green energy and resources company, FFI will be a key enabler of our industry-leading targets to decarbonise our operations by 2030 and to remove net emissions from our entire value chain by 2040,” Gaines said on Wednesday.

“Guided by our unique culture and values, Fortescue is strongly positioned to deliver on our strategic priorities of optimising returns from our mining operations and investing in growth and green energy, supported by our strong balance sheet and disciplined capital allocation framework. Our commitment to environmental and social governance leadership continues to gain recognition, including the recent distinction of a Gold Class award in the S&P Global Corporate Sustainability Assessment.

“The strength of our financial and operating performance, together with our ongoing commitment of delivering returns to shareholders, has resulted in the board declaring a fully franked interim dividend of A$0.86 per share, representing a 70% payout of the first half net profit after tax. We have had a strong start to the second half which positions us well to deliver on our guidance for the full year,” Gaines said.