Whitehaven Coal has outlined a bullish outlook after returning to a full-year profit on the back of its expanded operations.
The east coast miner posted net profit of $20.5 million for the year to June 30, compared to a $342.7 million net loss a year ago. Even excluding significant items, that 2014/15 loss was $10.7 million.
Sales revenue jumped 53 per cent to $1.16 billion as the miner posted a 35 per cent jump in production to 19.7 million tonnes of saleable coal, mainly on account of additional output from the new Maules creek mine in NSW, which was commissioned in July 2015.
The turnaround came despite weakness in global prices - due to softer demand from China and a supply glut - that is taking a toll on leading coal producers.
Whitehaven said coal markets appeared to have bottomed out after five years of price decline, flagging the nearly 40 per cent jump between January to August in the Newcastle GlobalCoal Index - an indicator of thermal coal prices - to $67 a tonne.
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The miner has tried to also offset price falls by increasing exports to Japan, South Korea, Taiwan and India, where it receives a premium for its higher quality coal.
Thermal coal, used to generate electricity, accounts for 80 per cent of the miner's total sales, although Whitehaven hopes to bring this proportion down to two thirds over the next few years.
"The high quality coal we are producing delivers higher yield and lower emissions and is in growing demand from Asia's new generation of power plants," managing director Paul Flynn said.
The company said it cut costs by eight per cent during the year to an average of $56 a tonne, helping it expand margins. It expects to broadly hold or grow margins further as it expands production at Maules Creek and Narrabri.
Maules Creek, which is currently producing at the rate of nine million tonnes a year, is on track to ramp up output to 10.5 million tonnes by January 2017.
Whitehaven has forecast it will lift overall saleable coal output to between 21 to 22 million tonnes in 2016/17.
Mr Flynn ruled out dividend payouts in the near term, saying the company is focusing on consolidating its performance and reducing debt.
"After that, it might be appropriate for the board to consider capital management initiatives, including dividends," he said.
Whitehaven shares, which have more than trebled this year, continued on their upward journey. By 1500 AEST, the stock was up 3.4 per cent to $2.11.
WHITEHAVEN SWINGS BACK TO PROFIT
* Net profit $20.5m vs $342.7m net loss
* Sales revenue up 53 pct to $1.16b.
* No dividend, unchanged.
