Stanmore Sets Record 2025 Output, Eyes Cost Efficiency Amid 2026 Production Dip

Record Production Amid Challenging Market Conditions

Stanmore Resources Limited has reported a resilient full-year performance for 2025, marked by record coal production and disciplined cost management. The company achieved run-of-mine coal output of 20.5 million tonnes and saleable production of 14.0 million tonnes, both setting new highs despite early weather disruptions. This operational strength was driven by the ramp-up at South Walker Creek and strong results from Poitrel, underscoring the success of recent capital investments.

However, the backdrop was a softer metallurgical coal market, with average realised sale prices falling 21% year-on-year to US$133 per tonne. Despite this, Stanmore maintained FOB cash costs at US$88 per tonne, slightly below the prior year, thanks to cost-saving initiatives and a lower strip ratio. These efforts helped sustain a robust underlying EBITDA of US$385 million and free cash flow of US$296 million, reinforcing the company’s financial resilience.

Strong Balance Sheet and Shareholder Returns

Stanmore’s balance sheet remains solid, with net debt steady at US$33 million and total liquidity nearing US$500 million, including US$212 million in cash. This financial strength has enabled the company to increase shareholder returns, declaring a fully franked final dividend of 8.9 US cents per share. This dividend brings cumulative returns since the mid-2022 acquisition of BMC to 34.2 US cents per share, reflecting a compounded annual total shareholder return of approximately 30%.

Outlook: Focus on Value and Efficiency in 2026

Looking ahead, Stanmore has provided guidance for 2026 that anticipates a modest decline in saleable production to between 12.8 and 13.4 million tonnes. This reduction primarily stems from a planned stepdown at the Isaac Plains Complex and Isaac Downs, as the company shifts focus from volume to optimised cost structures and cash flow generation. The FOB cash cost guidance range of US$93 to US$97 per tonne reflects inflationary pressures and foreign exchange headwinds but is largely offset by operational efficiencies and cost reductions.

Capital expenditure is expected to remain steady at US$85 to US$95 million, including a truck rebuilding program and tailings pumping project at Poitrel. Meanwhile, key development projects such as the Isaac Downs Extension and Eagle Downs continue to progress, supported by the maiden JORC compliant Reserves statement and ongoing regulatory approvals.

Strategic Positioning in a Volatile Market

CEO Marcelo Matos emphasised Stanmore’s unique positioning as an Australian-based pure-play metallurgical coal producer, poised to benefit from improving market conditions. The company’s disciplined approach to cost management and capital allocation, combined with a strong operational platform, provides a buffer against market volatility. Yet, the planned production stepdown signals a strategic pivot towards sustainable value creation rather than volume growth alone.