PERTH (miningweekly.com) – Coal miner New Hope Corporation has reported a stellar interim period, with profits after tax increasing by 41 938%, from A$0.8-million in the first half of 2021, to A$336.2-million.

Earnings before interests, taxes, depreciation and amortisation also increased 583% in the same period, from A$81.2-million to A$554.4-million. Total revenue for the period was up 153% to A$1.2-billion, while cash generated from operations was up by 626% to A$453-million.

The company told shareholders on Tuesday that the strong financial performance in the six months to January was underpinned by the combination of disciplined cost controls embedded across the group, strong operating performance which responded effectively to the challenges of Covid-19 and uncontrollable wet weather events, and the significant increase in realised coal prices during the reporting period.

CEO Rob Bishop said the company was well-positioned to continue generating strong, sustainable shareholder returns, with demand for high quality, lower emissions thermal coal expected to remain robust in the short to medium term as supply remained constrained.

“Cost control disciplines that were introduced during the 2021 financial year in response to a period of depressed prices have been embedded across the group and will ensure that New Hope remains in the lowest cost quartile compared to other producers of seaborne thermal coal.

“Bengalla dealt very well with the challenges from Covid-19-related labour shortages and wet weather to minimise the impact on coal production, which was down only 1% compared to the first half of last financial year. The mine will shortly take delivery of two additional haul trucks which will increase saleable production during the second half of the financial year.

“Strong demand and lower than normal stock levels held by customers have pushed thermal coal prices well above the long-term average. Newcastle Index pricing is currently above $300/t, and our forward sales book will support robust returns,” he added.

New Hope produced 4.4-million tonnes of coal in the half-year ended January, which was equal to the previous corresponding period, despite the Bengalla mine experiencing limited disruption to production during the half-year.

Average sales prices achieved during the half-year were up 146% compared with the previous corresponding period, reaching A$192.38/t.

“The company is experiencing significant cash-build following the remarkable recovery in coal prices since the lows of 2020. With the near-term coal price outlook remaining strong, coupled with a generous franking account balance the company is rewarding shareholders with larger fully franked dividends for this reporting period,” said Bishop.