Top coal mining stocks among ASX listed companies are showing promise backed by their continued execution of organic growth plans. Notable uplift with anticipated increased production make these potential growth companies for the near future.
New Hope Corporation Limited (ASX: NHC)
New Hope Corporation Limited (ASX: NHC) delivered a strong quarterly performance for the period ending 30 September 2024, driven by robust production levels and higher realized pricing. The company reported an Underlying EBITDA of $304.6 million, representing a 40.8% increase QoQ, supported by an 8.1% rise in group coal sales to 2.8Mt. This growth was primarily attributed to a 21.1% increase in coal sales at the Bengalla Mine. The average realized sales price improved to $192.4/t, up from $181.0/t in the prior quarter. Notably, Bengalla achieved an FOB cash cost of $61.6 per tonne, a 19.3% reduction QoQ, highlighting cost discipline.
As of 31 October 2024, New Hope, considered one of the high dividend stocks, maintained a robust cash position of $822.7 million, even after distributing a final FY24 fully franked dividend of 22 cents per share, amounting to $186.0 million. This liquidity includes $556.5 million in cash and equivalents and $266.2 million in fixed-income investments, with the latter delivering an annualized yield of ~9% since inception in April 2023. The company reiterated its guidance for FY25 saleable coal production between 10.8Mt and 11.9Mt, underpinned by ongoing ramp-up activities at the New Acland Stage 3 operations, where first coal was mined, railed, and sold during FY24. This milestone resulted in 2.4Mt of ROM coal production and over 1.0Mt of saleable coal during its first year of operations. With nearly 200 employees currently on-site, further workforce expansion is planned as the mine scales up to 5.0Mtpa over the next three years.
New Hope is among the best growth stocks to buy now as it is focusing on strategic growth opportunities, including its increased stake in Malabar Resources Limited (up from 15.0% to 19.97%), which enhances its exposure to high-quality metallurgical coal assets. The company continues to prioritize organic growth through key projects such as the Bengalla Mine Growth Project, the New Acland ramp-up, and the development of Malabar’s Maxwell Underground Mine. Despite stabilizing thermal coal prices following the record highs during the global energy crisis of FY22 and FY23, prices remain well above historical averages. This favorable pricing environment, coupled with the company’s focus on low-unit-cost, long-life assets, positions New Hope to deliver sustainable shareholder returns and pursue its third-highest earnings performance in company history. Looking ahead, New Hope’s targeted production increases and strategic investments are expected to generate meaningful value and bolster its shareholder return profile.
Yancoal Australia Limited (ASX: YAL)
Yancoal Australia Limited (ASX: YAL) September 2024 quarterly report highlights strong production and financial results. The company achieved 17.5 million tonnes of Run-of-Mine (ROM) coal and 13.2 million tonnes of saleable coal, with attributable sales of 10.4 million tonnes. This marks a 24% increase in attributable saleable coal production compared to the previous quarter, driven by higher output from its large opencut mines. The company, one of the high growth stocks, also realized an average coal price of A$170 per tonne, with thermal coal averaging A$157 per tonne and metallurgical coal at A$259 per tonne. Despite a 4% drop in thermal coal prices and a 19% decrease in metallurgical coal prices from the prior quarter, the company’s financial position remained robust, with a significant increase in cash reserves, rising by A$430 million to A$1.98 billion at the end of September.
The thermal coal market remained balanced, with price fluctuations influenced by geopolitical events such as Middle East tensions and a hotter than average summer in the northern hemisphere, which boosted electricity demand. The supply side saw constraints in South African, Russian, and Colombian exports, while Indonesian production remained strong. In metallurgical coal markets, prices were weaker due to reduced steel market demand, although the Low Vol PCI index saw some price improvement early in the quarter. Yancoal also continued to derive benefit from its large-scale, low-cost production profile, positioning the company well for changing market conditions. For the quarter average realized prices dropped a little short of the levels reported in the prior quarter, but the company still feels positive about the remainder of the year, particularly given the potential additional demand going into a cold winter in the northern hemisphere.
During the quarter, Yancoal also faced operational challenges, including weather disruptions from the La Nina weather pattern, which caused above-average rainfall in parts of eastern Australia. However, these impacts were mitigated by prior investments in water management systems, and overall production rates remained strong. On the development front, Yancoal is advancing its projects, including the MTW underground mine pre-feasibility study and the Stratford Renewable Energy Hub, which has received “Critical State Significant Infrastructure” status from the NSW government. The company also invested in exploration activities, spending A$5.1 million on drilling across its Hunter Valley, Moolarben, and Yarrabee sites. These efforts are aimed at enhancing resource classification, coal quality, and groundwater monitoring to support future growth.
Source: Company’s Report
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