- Recovering coal prices were not enough to prevent Whitehaven Coal (WHC) from booking a $544 million loss for FY21, driven mostly by a $650 million asset write-down
- The write-down was caused by asset impairments relating to reductions in JORC reserves, mine plan revisions and conservative price assumptions
- Gross revenue fell to $1.5 billion, which Whitehaven attributes to a tough US – Australian dollar exchange rate
- Looking ahead, Whitehaven maintains a strong outlook for coal prices for the next two to three years as coal supplies remain tight
- Whitehaven Coal’s shares are up 5.41 per cent to trade at $2.34
Recovering coal prices were not enough to prevent Whitehaven Coal (WHC) from booking a $544 million loss for FY21, driven mostly by a $650 million asset write-down.
Whitehaven attributed the deficit primarily to “significant expenses” caused by asset impairments relating to a reduction in Narrabri’s JORC reserves, mine plan revisions at Werris Creek and “conservative price assumptions”adopted in the face of a volatile coal market.
The coal miner’s $30 million after-tax net profit from the previous financial year fell to an $87.3 million after-tax net loss, excluding significant one-off expenses.
Gross revenue fell from $1.7 billion during the prior corresponding period to clock in at $1.5 billion million for the end of the year.
The ASX200-lister said the biggest influence on earnings had been the exchange rate of the Australian dollar against the US dollar but also blamed downgraded production volumes, shipping delays and softened coal prices in late FY20.
Whitehaven realised an average price of US$68 (A$93) per tonne for its thermal coal sales and US$85 (A$117) per tonne metallurgical coal products sales in FY21.
“The COVID-19 related softening in coal prices in late FY20 continued in the early part of FY21 with prices reaching historical lows of US$49 (A$67) per tonne in August 2020,” the company said in a statement.
“Since that time coal prices have staged a strong recovery with the globalCOAL NEWC index reaching US$132 (A$181) per tonne in late June 2021.”
Looking ahead, Whitehaven maintains a strong outlook for coal prices for the next two to three years as coal supplies remain tight.
Whitehaven Coal’s shares were up 5.41 per cent at 1:56 pm AEST to trade at $2.34.