Stanmore posts profit hit, confirms US$450m refinancing
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The news: Stanmore Resources reaffirmed its full-year production guidance as lower metallurgical coal prices continued to weigh on earnings.
The coal miner also confirmed binding commitments of USD450 million ($663 million) for the refinance its existing debt facilities, and announced an agreement with the Queensland government for a gas-to-electricity power project at its South Walker Creek coal mine.
The numbers: Stanmore reported profit after tax of USD136 million for the 12 months to June 2024, down 60% from the previous corresponding period. EBITDA fell 37.4% to USD407 million while revenue lowered 17.9% to USD1.2 billion.
The company noted that metallurgical coal prices moderated over the first half of 2024 compared to 2023, as supply conditions from East Coast Australia improved. However, the average sales price reduced 30% to USD175 per tonne during the year to June.
The board declared an interim dividend of 4.4 US cents per share, having not made a pay out this time last year.
Stanmore also announced that it has received binding commitments for the refinance of its existing debt facilities, comprising a USD350 million five-year amortising term loan facility, as well as a USD100 million revolving credit facility and restructured contingent instrument facilities.
It said that commitments were sourced from a syndicate of commercial banks and financial institutions, with the proceeds of the term loan used to repay an existing USD210 million balance of its acquisition financing facility, and for general corporate purposes.
Meanwhile, Stanmore has entered into an agreement with the Queensland government for funding towards a new 20 megawatt gas-to-electricity power station at the South Walker Creek open cut coal mine.
Supported by the state government, the Low Emissions Invest Partnership (LEIP) project aims to reduce future fugitive mine emissions through the capture of coal seam at South Walk Creek, with construction expected to be completed by 2027 and commercial-scale coal seam gas drainage and electricity generation for at least 15 years after that.
The context: Stanmore said higher first-half production has translated into higher sales and lower free on board cash costs, resulting in a reduction to its consolidated full-year cost guidance.
The miner noted that benchmark metallurgical coal prices have strengthened relative to prime hard coking coal prices, with the company "maintaining a strong forward sales program to be well placed through the second half of the year".
The sources: ASX announcement, ASX announcement, ASX announcement
