Australian thermal coal-mining corporation New Hope [ASX:NHC] has released 1H FY23 results for its investors, accompanied by the promise of fully-franked interim dividends of 30 cents a share.
In its half-year interim report, the company reported it had grown its net profit after tax by 104.4% in the half year, totalling $668.6 million.
Revenue likewise had jumped by 54.2%, with $1.6 billion in the half year.
Early on Tuesday morning the coal miner’s share price was trading for around $4.90 at time of writing, having taken a 5.5% discount to the prior day’s closing price.
NHC is down 11% in the week, and yet it remains up in its sector and wider market, with a 67% gain on its own record over the last 12 months:
Source: TradingView
New Hope’s first half FY2023
Early on Tuesday morning, coal mining corporation New Hope released its interim results for the first half of the financial year 2023, which included gains in resource prices, profit, revenue, and a healthy dividend for its investors.
New Hope reported a 103% increase in net profit after tax (NPAT), with the hefty sum of $669 million on last year’s total.
Underlying earnings before interest, tax, depreciation, and amortisation (EBITDA) had also jumped 87%, to $1.03 billion.
Total revenue had increased 54% to $1.58 billion for the half year, made up of $983 million in cash generated purely from its operations over the six months (a 117% increase), and $580 million in government contributions.
The realised price of coal leapt 143% to $467.4 per tonne, allowing the group to churn more of a profit on production, however, the group did report it had sold less tonnage than the year before, slipping 34% year-on-year by offloading just 3.4Mt on customers.
Nevertheless, the group was able to declare a special dividend of 10 cents a share, and interim dividends of 30 cents per share as well.
Outlook for New Hope
The coal miner believes Australian thermal coal will be more resilient to declining demand compared with other regions that produce the blackened rock and quoted Environment Minister Tanya Plibersek, who had reassured markets that ‘Coal and gas are going to be part of our future for years to come’.
New Hope reported that increased demand and supply disruptions impacted the price in recent months, and that the current underinvestment in thermal coal will support prices going forward. It stated:
‘Despite massive investment in renewables, coal generation as a share of the world energy mix continues to grow.’
The group says it has the ability to ‘almost double’ its current production levels over the next three years, expected to occur via organic growth.
NHC said its NSW Government Exploration License for Bengalla will provide further long-term opportunities, and the group is examining opportunities to repurpose assets and transform its business at end of mine life.
The group’s also completing studies and strategies for large scale solar generation at Malabar, as well as further investigations for decarbonisation and scenario testing at Bengalla and New Acland.
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Regards,
Mahlia Stewart,
For The Daily Reckoning Australia
