Stanmore Holds Interim Dividend as Economic Uncertainty Clouds Outlook
Stanmore Resources delivered resilient first-half 2025 results despite severe wet weather, maintaining solid production and financial metrics while suspending its interim dividend amid economic uncertainty.
- Saleable coal production of 6.5 million tonnes despite heavy rainfall
- Underlying EBITDA of US$147 million with positive operating cash flow
- FOB cash costs held within full-year guidance at US$89/t
- No interim dividend declared due to macroeconomic caution
- Completion of major expansion projects ahead of schedule and budget
Operational Resilience Amid Challenging Weather
Stanmore Resources Limited has showcased notable operational resilience in the first half of 2025, navigating nearly 600mm of rainfall; close to the five-year average for the Moranbah region; without compromising safety or financial discipline. Saleable coal production reached 6.5 million tonnes, a slight dip from the previous year but commendable given the adverse weather conditions that disrupted mining and logistics.
Safety remains a cornerstone of Stanmore’s operations, with the company reporting zero serious accidents for the first time since late 2023. This achievement underscores the effectiveness of its safety protocols even during challenging periods.
Financial Performance and Cost Management
Despite a 29% decline in revenue to US$867 million, primarily driven by lower coal prices and volumes, Stanmore maintained an underlying EBITDA of US$147 million. This was supported by disciplined cost control, with FOB cash costs improving slightly to US$89 per tonne, comfortably within the company’s full-year guidance range. Positive operating cash flow of US$151 million further highlights the company’s robust cash generation capabilities.
Capital expenditure was significantly reduced compared to the prior period, reflecting the completion of major projects such as the MRA2C creek diversion ahead of schedule and below budget. These projects are expected to underpin a higher production run-rate in the second half of 2025.
Balance Sheet Strength and Strategic Outlook
Stanmore’s balance sheet remains solid with net debt at US$99 million and total liquidity exceeding US$400 million, including undrawn financing facilities. This financial flexibility positions the company well to manage ongoing market volatility and invest in growth opportunities.
The company reaffirmed its 2025 guidance, anticipating a second-half weighted production profile and capital expenditure between US$80 million and US$90 million. However, reflecting caution amid global economic uncertainties, the board has elected not to declare an interim dividend, signaling prudence in cash management.
Notably, Stanmore reported a net increase in coal reserves and resources, including maiden declarations for the Isaac Downs Extension Project, reinforcing its long-term asset base in Queensland’s Bowen Basin.
Looking Ahead
With a strong operational foundation and strategic projects completed, Stanmore is poised for a more robust second half of 2025. Yet, the company’s cautious stance on dividends and the ongoing macroeconomic uncertainties suggest that investors should watch closely how market conditions evolve and how effectively Stanmore can capitalize on its expanded capacity.
Bottom Line?
Stanmore’s steady half-year performance sets the stage for a pivotal second half, but macroeconomic headwinds warrant close investor attention.
Questions in the middle?
- How will Stanmore’s production ramp-up in H2 2025 offset the first half’s weather disruptions?
- What factors will influence the board’s decision on the final 2025 dividend?
- How resilient will Stanmore’s cost structure remain if coal prices continue to soften?
