Logistics Risks Loom as New Hope Targets Recovery in FY26 Coal Output
New Hope Corporation reported a 7.1% rise in quarterly saleable coal production and a 15.5% jump in underlying EBITDA, driven by operational improvements and easing logistics. The company declared a fully franked dividend and set a cautiously optimistic FY26 production target amid ongoing challenges.
- 7.1% increase in group saleable coal production to 2.7 million tonnes
- Underlying EBITDA up 15.5% to $107.9 million for the quarter
- Bengalla Mine saleable coal production rises 23.7%, with 18.2% lower cash costs
- New Acland Mine saleable coal production declines 21.3% due to processing and rail constraints
- FY26 guidance targets 10.2–11.5 million tonnes saleable coal production
Quarterly Performance Highlights
New Hope Corporation has reported a solid rebound in coal production and financial performance for the quarter ended October 2025. Group saleable coal production increased by 7.1% to 2.7 million tonnes, supported by improved logistics and more favourable weather conditions compared to the previous quarter. This operational uptick translated into a 15.5% rise in underlying EBITDA, which reached $107.9 million.
The company’s flagship Bengalla Mine in New South Wales demonstrated a particularly strong recovery, with saleable coal production surging 23.7% to nearly 2 million tonnes. This was accompanied by an 18.2% reduction in FOB cash costs, reflecting better utilisation of the coal handling and preparation plant and easing of port congestion. However, the mine is still managing the aftermath of significant weather disruptions experienced in the prior quarter, which affected pit sequencing and stock management.
Challenges at New Acland and Strategic Moves
In contrast, New Acland Mine in Queensland faced a 21.3% decline in saleable coal production, primarily due to processing lower-yield coal stocks and rail capacity constraints linked to infrastructure projects like Cross River Rail. Despite these headwinds, New Acland continues to maintain elevated stockpiles to capitalise on any additional rail capacity that may become available.
Strategically, New Hope increased its stake in Malabar Resources to 25.97%, reinforcing its position in the Maxwell Underground Mine project. The company also completed its exit from the oil and gas sector by selling Bridgeport Energy, signalling a sharper focus on coal operations.
Financial Position and Capital Management
New Hope declared a fully franked final dividend of 15.0 cents per share for FY25, totalling $126.4 million, underscoring its commitment to shareholder returns. Post-dividend, the company held a robust cash position of $544.3 million, including cash equivalents and fixed income investments. The ongoing on-market share buy-back program remains active, although no shares were repurchased during the quarter.
Outlook and FY26 Guidance
Looking ahead, New Hope has set FY26 saleable coal production guidance between 10.2 and 11.5 million tonnes. Bengalla Mine is expected to return to its 13.4 million tonnes per annum ROM production run rate in the second half of FY26, following a period of pit realignment and recovery from weather-related setbacks. New Acland’s production growth is anticipated to be constrained by rail system outages but is supported by ongoing efforts to mitigate these risks.
Overall, the company’s outlook balances optimism about operational recovery with caution around external logistics and infrastructure challenges. Safety metrics showed improvement, with a notable decrease in the Total Recordable Injury Frequency Rate, reflecting continued focus on workforce wellbeing.
Bottom Line?
New Hope’s operational rebound and disciplined capital management set the stage for a pivotal FY26 as it navigates logistical challenges and positions for sustainable growth.
Questions in the middle?
- How quickly can Bengalla Mine fully recover to its target production run rate?
- What impact will rail capacity constraints have on New Acland’s medium-term growth?
- Will coal price volatility affect New Hope’s ability to sustain dividend levels?
