New Hope Corporation Limited ((AU:NHC)) has held its Q2 earnings call. Read on for the main highlights of the call.
The recent earnings call of New Hope Corporation Limited painted a picture of robust performance in the first half of 2025. The company reported significant improvements in safety, production, and financial metrics, despite facing operational challenges due to a cyclone and a challenging coal market. Overall, the sentiment was positive, indicating a strong position for continued growth and shareholder returns.
Improvement in Safety Metrics
The company highlighted a notable improvement in safety metrics, with the 12-month moving average Total Recordable Injury Frequency Rate (TRIFR) decreasing by 18% over the past six months, from 4.99 to 4.08. This improvement underscores New Hope’s commitment to maintaining a safe working environment.
Significant Increase in Coal Production
New Hope reported a substantial increase in coal production, with raw coal production rising by 56% to 8.3 million tonnes. Saleable coal production also saw a 33% increase to 5.4 million tonnes, and coal sales surged by 44% compared to the first half of 2024. These figures highlight the company’s operational efficiency and capacity to meet market demand.
Financial Success
The earnings call revealed strong financial performance, with underlying EBITDA increasing by 22% to $517 million. Statutory net profit after tax rose by 35% to $340 million compared to the first half of 2024, reflecting New Hope’s effective financial management and profitability.
Strong Cash Flow and Shareholder Returns
New Hope generated $370 million in cash flow from operating activities, enabling the company to announce a fully franked interim dividend of $0.19 per ordinary share. Additionally, a $100 million share buyback was announced, demonstrating the company’s commitment to delivering value to shareholders.
Operational Achievements at Bengalla Mine
The Bengalla Mine achieved increased saleable coal production of 4.2 million tonnes, with FOB cash costs decreasing to $68.30 per sales tonne. This operational success contributes to the company’s overall performance and cost efficiency.
Impact of Cyclone on Operations
Operations were temporarily impacted by a cyclone, which caused shipping disruptions and rail corridor flooding. Despite these challenges, New Hope managed to maintain strong production levels, showcasing resilience in the face of adverse conditions.
Challenges in Coal Market Dynamics
The company faced challenges in the coal market due to a mix of excess supply and soft demand, leading to decreased coal prices. This market dynamic poses a challenge for maintaining profitability but New Hope remains optimistic about future prospects.
Revised Down CapEx Guidance for Bengalla
New Hope revised down its sustaining capital guidance for Bengalla due to timing delays rather than cuts in CapEx. This adjustment reflects a strategic approach to managing capital expenditures while continuing to focus on long-term growth.
Forward-Looking Guidance
Looking ahead, New Hope aims to ramp up production at the New Acland Mine and maintain increased production levels at Bengalla. The company is also focusing on organic growth projects, including the development of Malabar’s Maxwell underground mine. These initiatives are expected to support continued growth and shareholder value.
In conclusion, New Hope Corporation Limited’s earnings call highlighted a strong performance in the first half of 2025, with improvements in safety, production, and financial metrics. Despite facing operational and market challenges, the company is well-positioned for future growth and shareholder returns.