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Sydney, Sep 24, 2008 (ABN Newswire) - Queensland coal miner and Washington Soul Pattinson 61% owned subsidiary, New Hope Corporation has confirmed the benefits of the coal boom in a quite spectacular fashion.
And it expects more of the same in 2009: "Significant earnings growth should continue in the 2009 financial year as coal prices are expected to remain strong, supported by the company's incremental mine expansions and extensions,'' the company told the ASX yesterday.
2008 sales, earnings, production, exports and profits were all higher, as are payments to shareholders, including Soul Patts, which reports its full year figures tomorrow.
Operational net profit after tax rose 30.8% to $90.7 million for the 2008 financial year, after a 16% increase in saleable coal production to 4.45 million tonnes,
Exports rose 24% to 3.2 million tonnes as prices rose for exports and domestic coal shipments.
The company said there was also a higher contribution from a record year of coal throughput at the Queensland Bulk Handling facility at the Port of Brisbane, which became a wholly owned subsidiary of New Hope in August last year.
New Hope has declared a final dividend of 3.5c per share, a 40% increase on the previous year, and a special dividend of 8c per share, a 166% increase on the previous year.
Both dividends will be fully franked. Earnings per share increased by 30.2% to 11.2c.
That special dividend will total some $600 million (very tasty for Soul Patts) and will be paid in November.
Now it says it is evaluating options to increase coal output, including re-opening an old mine, to take advantage of higher export prices that drove the 2007-08 result.
The result was in line with guidance provided in August of an expected profit range of between $88 million and $91 million.
New Hope says it has re-started mining at its Jeebropilly mine, which the company closed in 2007, and is also evaluating mining remnant coal at its New Oakleigh mine to take advantage of the high export prices.
"While the known coal reserves at our New Oakleigh mine near Ipswich are likely to be exhausted in 2009, the current high export coal prices may make it economical to mine any remnant coal currently being evaluated, even with high operating costs," chairman Robert Millner said in a statement with the results.
"These are low risk projects that allow New Hope to take further advantage of the current export demand for coal."
New Hope sees output rising 10% this year to 4.9 million tonnes, from 4.451 million tonnes last year.
Revenue in the year to July 31 jumped 32.6% to $329.79 million.
New Hope supplies thermal coal - used as fuel for power stations - to a range of domestic and export customers.
The company recently completed the sale of its New Saraji coal project to the BHP Billiton Mitsubishi Alliance (BMA) for $2.45 billion earlier this month. It paid considerably less for the prospect several years ago.
Mr Milner said the sale of the New Saraji project did not contribute to the result. The proceeds would allow New Hope to continue its significant capital expansion programs.
"We will be able to continue to expand our New Acland mine and expand the QBH facility to handle the expected industry requirements from South East Queensland.
"The sale also allows us to pay a fully franked special dividend of about $600 million in November 2009," he said.
For all the good news, the market wasn't impressed and the shares fell 6c to 4.40.
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