New Hope Group - 2024 Full Year Results - 17 September 2024
NHC (NHC) Share Update September 2024 Monday 16th
New Hope Group Reports 2024 Full Year Results with Mixed Performance
New Hope Group (ASX: NHC) has released its full-year results for the fiscal year ending 31 July 2024, showing a mixed performance in operational and financial metrics.
Instant Summary:
- 151% increase in Total Recordable Injury Frequency Rate (TRIFR).
- 32% increase in ROM coal production to 12.3Mt.
- 26% increase in saleable coal production to 9.1Mt.
- 14% increase in coal sales to 8.7Mt.
- 22¢ fully franked final dividend per share.
- 51% decrease in underlying EBITDA to $860M.
- 63% decrease in cash flow from operations to $562M.
- 56% decrease in NPAT to $476M.
Operational Highlights
New Hope Group has reported a strong operational performance for the year ending 31 July 2024. The company achieved a 32% increase in ROM coal production, reaching 12.3 million tonnes (Mt), and a 26% increase in saleable coal production, totaling 9.1Mt. Coal sales also saw a 14% rise, amounting to 8.7Mt. These operational achievements were accompanied by a 151% increase in the Total Recordable Injury Frequency Rate (TRIFR), which rose to 5.32.
Financial Highlights
Despite the operational gains, New Hope Group's financial performance showed significant declines. The company's underlying EBITDA dropped by 51% to $860 million, and cash flow from operations decreased by 63% to $562 million. Net Profit After Tax (NPAT) also fell by 56%, amounting to $476 million. The company declared a fully franked final dividend of 22¢ per share.
Asset Performance
Bengalla Mine reported an 11% increase in saleable coal production, reaching 8.0Mt, with a FOB cash cost of $77.8 per tonne. The New Acland Mine successfully restarted operations, producing 1.0Mt of saleable coal in FY24 and is expected to ramp up to 5Mtpa by FY27. Malabar Resources Limited, in which New Hope holds a 19.97% equity interest, continues to show promise with its low-cost, long-life metallurgical coal mine.
Market Outlook
New Hope Group remains optimistic about the future, citing increasing energy needs from developing Southeast Asia as a key driver for thermal coal demand. The company aims to continue responsibly operating its assets to meet this growing demand.
The mixed financial results could lead to a cautious response from the market. While operational metrics have improved, the significant declines in EBITDA, cash flow, and NPAT may concern investors. The increase in TRIFR also raises questions about workplace safety, which could impact investor sentiment.
Investor Reaction:
Analysts are likely to have mixed reactions to New Hope Group's results. The operational improvements are positive, but the financial declines and increased TRIFR could lead to a cautious outlook. Investors may focus on the company's ability to maintain and improve its financial health in the coming quarters.
Conclusion:
Investors should closely monitor New Hope Group's future performance, particularly its financial health and safety metrics. The company's strategic initiatives and market conditions will play a crucial role in shaping its future prospects.