The Whitehaven Coal Ltd (ASX: WHC) share price is tumbling today following a number of company updates. Here’s what the company announced.
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The Whitehaven Coal Ltd (ASX: WHC) share price tumbled in mid-morning trade following a number of company updates. At the time of writing, the coal miner’s share price has recovered slightly, trading at $1.77, up 0.57%.
Let’s take a look at what the company announced to the ASX market this morning.
Firstly, Whitehaven announced that the company is currently facing disruptions to its operations.
According to its release, Whitehaven Coal advised that the Newcastle Coal Infrastructure Group (NCIG) has suspended ship loading at the Port of Newcastle.
A number of faults were identified after conducting a structural assessment of its ship loader SL1. A maintenance team has been deployed and will perform repair works to the damaged SL1. It is expected that there will be an outage of around two weeks.
As a result, NCIG will not have any ship-loading capability until the repairs to SL1 are complete. Its other ship loader, SL2, remains offline and won’t be available until later in the year. SL2 had previously suffered storm damage in November 2020.
Furthermore, Whitehaven Coal noted that current weather-related port restrictions are hampering vessel movements at the Port of Newcastle. It is estimated that there are about 40 ships queued at Newcastle, awaiting entry to the port.
New South Wales floods update
While heavy rains fall down across New South Wales, authorities are predicting flooding in the Namoi River – Gunnedah Basin. Whitehaven Coal stated that it does not expect flooding to occur at any of its sites. However, it did state that local roads submerged with water could hinder workforce movements and product haulage.
In addition, the Australian Rail Track Corporation said that its Hunter Valley operations are set to resume later this week. This comes as localised flooding is expected to subside in the coming days.
Whitehaven FY21 revised guidance
Due to the current climate, Whitehaven Coal revised its guidance for FY21. It explained that Maules Creek is achieving a strong production rate. However, its Narrabri site is functioning slower than anticipated.
The mixed performance, coupled with the recent flooding and port infrastructure impacts has led the company to update its outlook.
Run-of-mine (ROM) coal production has been forecasted to be in the range of 21.4 million tonnes to 22 million tonnes. This compares against the previous guidance which projected ROM coal production of 21 million tonnes to 22.5 million tonnes.
Managed coal sales are envisaged to slightly decrease to 18.5 million tonnes and 19 million tonnes. Originally, the company assumed this metric would be in the range of 19 million tonnes to 20 million tonnes.
About the Whitehaven Coal share price
The Whitehaven Coal share price has increased modestly, up 5% for the past 12 months. In the last 30 days, however, the company’s shares have gained more than 15%.
On valuation grounds, Whitehaven Coal has a market capitalisation of around $1.8 billion, with more than 1 billion shares outstanding.
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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.