PERTH (miningweekly.com) – Record shipments, earnings and operating cashflow for the half-year ended December have seen iron-ore miner Fortescue Metals delivering a 93% increase in interim dividends to shareholders.
Ore shipments for the six months under review were up by 2% on the previous corresponding period, to 90.7-million tonnes, with revenues increasing 44% to $9.3-billion, reflecting both the 3% increase in ore sales and the 42% increase in average realised prices, which reached $114/t during the interim period.
Underlying earnings before interest, taxes, deprecation and amortization (Ebitda) were up 57% on the previous corresponding period, to $6.6-billion, while underlying net profit after tax increased by 66%, to $4.08-billion.
“Fortescue’s performance for the first half of 2021 has been outstanding, and we are very proud of the whole team who have delivered our best half-year operating and financial results since the company was established,” said CEO Elizabeth Gaines on Thursday.
“Our continued focus on cost management contributed to underlying Ebitda of $6.6-billion at an increased margin of $80/t.”
“Pleasingly, our safety performance also improved, and we have maintained our unwavering commitment to protecting the health and wellbeing of our team during the ongoing global Covid-19 pandemic, ensuring that we continue to meet strong demand from our customers. As a result, Fortescue’s significant economic contribution, together with the mining and resources industry continues to underpin the strong performance of the Western Australian and national economies.
“Our commitment to sustainability across all aspects of our business extends to the important role that Fortescue Future Industries is taking in the global development of renewable energy, building on the projects we have underway in green hydrogen. These exciting diversification opportunities will be supported by Fortescue’s disciplined capital allocation framework.
“Fortescue’s excellent operating performance in the first half and our continued focus on capacity optimisation have supported an increase in 2021 shipments guidance to 178-million to 182-million tonnes and against the backdrop of the continued strength of the Australian dollar, we have revised our guidance for C1 cost.”
C1 costs for the 2021 financial year have been estimated at between $13.50/t and $14/t, with the miner also setting a capital expenditure target at the upper end of between $3-billion to $3.4-billion.
“Our world-class, integrated operations and customer-focused marketing strategy, together with completion of key milestones across our Eliwana and Energy projects, strongly position Fortescue to continue to deliver sustained returns to our shareholders.
“The board have declared an interim dividend of A$1.47 per share, which represents an 80% payout ratio of net profit after tax, consistent with our target to pay the upper end of our stated dividend policy range,” Gaines said.