New Hope Corporation (ASX: NHC) half-year profit more than doubles; shares jump 10%

Highlights:

• New Hope Corporation Limited (ASX: NHC) was trading higher on ASX on Tuesday after it released its interim results.
• During the period, NHC’s revenue rose 54.2% to AU$1,582 million against AU$1,025 million in pcp.
• NHC’s net profit grew 102.4% to AU$669 million in the first half from AU$330 million in pcp.

New Hope Corporation Limited (ASX: NHC) shares surged nearly 10% to AU$5.39 around 12:55 pm AEDT on Tuesday, 21 March 2023, after it released its interim results for the six months ended 31 January 2023.

Let’s scan through NHC’s half-year results.

During the reported period, New Hope’s revenue rose 54.2% to AU$1,582 million against AU$1,025 million in pcp. Net profit grew by 102.4% to AU$669 million from AU$330 million in pcp. Basic earnings a security in the half-year period stood at 77.5 cents versus 39.7 cents in pcp.

During the period, average realised prices jumped by 142.9% to AU$467.4/t versus AU$192.4/t in pcp due to robust worldwide demand for the superior quality of Australian thermal coal.

On 31 January this year, the company’s cash and cash equivalents stood at AU$971.2 million, increasing from AU$715.7 million in pcp.

For the interim period, the company’s board announced a 100% franked dividend of 30 AU cps and a special distribution of 10 AU cps. This dividend will be paid on 3 May this year. It has an ex-dividend date of 17 April and a record date of 18 April.

NHC’s half-yearly operational results

NHC’s saleable coal output in the half-year was 3.2Mt, which is 1.2 Mt less than the coal produced in pcp. The reduction happened due to production disruptions at the Bengalla Mine because of flooding.

At the New Acland Coal Mine front, New Acland Stage 3 Project Environmental Authority was issued by the Department of Environment and Science in June last year. In August last year, the Stage 3 Project Mining Leases were issued. It was also awarded with Associated Water Licence on 20 October last year.

NHC FY23 outlook

The company anticipates nearly doubling the present production levels over the next three years organically as coal demand continues to grow despite increased focus on renewables. NSW government awarded EL 9431 (Bengalla Exploration Licence), which can deliver long-term growth prospects.

For the long-term period, NHC wants to concentrate on coal via its present thermal portfolio and fresh prospects in either metallurgical or thermal coal production.