Whitehaven Coal Earnings: Record Profit on High Thermal Coal Prices

No-moat Whitehaven Coal’s fiscal 2023 result was another record given high prices. Net profit after tax of AUD 2.7 billion, or AUD 3.03 per share, was up 37% on last year and 8% above our expectations. EBITDA rose 30% to about AUD 4 billion while Whitehaven generated significant free cash flow of AUD 3.3 billion, or AUD 3.75 per share. The average coal price of AUD 445 per metric ton, also 37% higher than the AUD 325 last year, drove the record result with coal sales volumes down 8%. Along with inflation, lower volumes saw unit costs rise 23%, to AUD 103 per metric ton. The AUD 0.42 per share fully franked dividend was more than we expected, taking total 2023 dividends to AUD 0.74. Including share repurchases, the payout ratio of 50% was at the top end of the target range.