Shares in the Australian coal miner are climbing on the back of the company’s announcement
The post The Whitehaven Coal (ASX:WHC) share price lifts after quarterly update appeared first on The Motley Fool Australia. –
Currently Whitehaven shares are exchanging hands for $2.04 a piece, 3.03% up on the day.
Let’s take a closer look at the Australian coal miner’s results in closer detail.
Whitehaven’s share price jumps despite output setbacks
Whitehaven shares lifted after the earnings release, despite reporting its fourth-quarter saleable coal production had reduced by 39%.
Today’s results also exhibit a 7% decline in saleable coal production from the same time last year, coming in at 3.8 million tonnes (Mt).
The company also detailed that run-of-mine coal output was 20.56 Mt, flat to 20.60 Mt 12 months ago.
Explaining the results, Whitehaven claimed it had faced challenges at its Narrabri mine in New South Wales this year. It stated the Narrabri operation has been undergoing longwall equipment repairs due to the surrounding environment.
The company has experienced unscheduled downtime as a result of the repairs, hurting overall production.
Whitehaven managing directory and chief executive Paul Flynn said in the report:
Unfortunately difficult geological conditions persisted at Narrabri through the second half and, having now navigated through this area, we are focused on finishing the balance of the panel expeditiously and getting to the change out scheduled for Q2 of FY22.
Surging coal prices
Although coal prices hit new highs of US$135 per tonne this week, in its report, Whitehaven stated it had received a discounted price of US$94 a tonne.
Nonetheless, the company is adamant it will realise the benefits of these price hikes later on in the year.
Speaking on this topic, Flynn mentions in the report:
Prices for high-CV thermal are at 10-year highs, and we will begin to see this materialise into strong free cash flow over the coming months.
Whitehaven share price snapshot
The Whitehaven share price has climbed 23% this year to date, extending the last 12 month’s gain of 35%.
These returns have outpaced the S&P/ASX 200 Index (ASX: XJO)’s return of 11% this year and 21% over the last year.
At the time of writing, Whitehaven has a market capitalisation of $2 billion.
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The author Zach Bristow has no positions in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. 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.