Bathurst Resources holds its full-year EBITDA guidance of NZD 35m-45m despite surging fuel costs linked to the Iran conflict, offset by stronger Hard Coking Coal prices and export volumes. The company advances key metallurgical coal projects in New Zealand and Canada while managing operational challenges in domestic segments.
- FY26 EBITDA guidance maintained at NZD 35m-45m
- Year-to-date consolidated EBITDA of NZD 30m
- Export volumes up despite lower HCC benchmark price
- Progress on Tenas Project and Buller Plateaux Continuation Project
- Strong consolidated cash position of NZD 141m
EBITDA Holds Steady Despite Rising Costs
Bathurst Resources (ASX:BRL) has kept its full-year consolidated EBITDA guidance unchanged at NZD 35 million to 45 million, even as fuel costs surged dramatically due to the ongoing conflict in Iran. The company reported a year-to-date EBITDA of NZD 30 million for the March 2026 quarter, a NZD 10 million decline from the prior year primarily driven by reduced earnings in its North and South Island domestic segments.
The spike in fuel expenses, a direct fallout from geopolitical tensions, has been largely balanced by an uptick in the Hard Coking Coal (HCC) benchmark price during FY26. Export sales volumes increased by 96kt compared to the prior year, partly offsetting domestic revenue declines. However, the average price received per tonne for HCC was lower than the previous year, reflecting a softer pricing environment earlier in the fiscal year.
Bathurst's export segment benefited from the reopening of the rail line after the Tawhai Tunnel closure last year, enabling higher shipment volumes. Yet, rising direct mining costs including labour, fuel, and contractors have pressured margins. The company’s consolidated cash position remains robust at NZD 141 million, supporting ongoing development and operational needs.
Domestic Segments Face Operational Headwinds
In the South Island, Bathurst’s domestic segment is in a planned decline phase as the mine approaches the end of its life, compounded by customers shifting to alternative fuels. This has led to lower sales volumes and revenue. The North Island segment encountered extended overburden removal periods at the Waipuna West Extension pit, increasing direct costs such as fuel and labour, and causing production shortfalls that required coal stockpiles to meet sales contracts.
Operational delays due to labour shortages and longer stripping phases have weighed on production forecasts, though management has implemented updated rosters to improve efficiencies. Sales volumes in the North Island remain behind forecast year-to-date, while the South Island production aligned with the mine’s winding-down profile.
Advancement of Key Development Projects
Bathurst continues to make significant strides in its metallurgical coal development pipeline. The 100% owned Tenas Project in British Columbia has reached key regulatory milestones, including acceptance of multiple environmental information requests, and is set to enter the final effects assessment phase in Q2 2026. The project boasts a low strip ratio of 3.6:1, positioning it as a potentially low-cost producer with an expected mine life of around 21 years and production targeted for FY29.
Meanwhile, the Buller Plateaux Continuation Project (BPCP) in New Zealand is nearing submission into the Fast-track Approvals Act (FTAA) process, which could accelerate permitting. The BPCP aims to extend Stockton mine operations by approximately 15 years and is central to Bathurst’s strategy for long-life steelmaking coal assets. The company has taken extra time to ensure the FTAA application is comprehensive, engaging extensively with regulators and stakeholders.
These developments build on the updated feasibility studies released in late 2025, which confirmed improved net present values for both Tenas and Crown Mountain projects despite rising capital and operating costs. The Tenas Project’s post-tax NPV rose to USD 269 million, reflecting higher coal price assumptions that offset cost inflation. The Crown Mountain Project’s pre-tax NPV10 doubled to USD 942 million, reinforcing its development potential.
Market Conditions and Outlook
The export HCC price experienced volatility in early 2026, spiking to USD 252 per tonne in February due to supply disruptions from Cyclone Koji before settling around USD 230 per tonne. While the US-Iran conflict has yet to directly affect coking coal demand, the associated freight and fuel cost increases have raised mining expenses, potentially setting a higher price floor for coal. This dynamic could squeeze margins if steel demand remains weak and price increases cannot be fully passed on.
Bathurst’s export shipments in the quarter were slightly behind forecast due to shipping schedule adjustments aligned with customer needs. Domestic production also lagged forecasts, particularly at Rotowaro, but management expects improvements following operational changes. The company’s focus on balancing cost pressures with production and sales volumes will be critical as market uncertainties persist.
Legal Proceedings and Corporate Position
Bathurst continues to face ongoing litigation with Talley’s Group Limited in the New Zealand High Court. The case remains under non-publication and suppression orders, with a substantive trial expected in mid to late 2027. This legal uncertainty adds a layer of risk to the company’s outlook.
On the shareholder front, Bathurst’s register includes significant holdings by Crocodile Capital (9.9%), Republic Investment Management (9.2%), and Talley’s Group (8.6%), among others. The company’s market capitalisation stood at approximately AUD 146.4 million as of late April 2026, with its share price at AUD 0.61.
Bathurst’s steady financial performance and project progress come amid a challenging environment of rising input costs and geopolitical tensions. The company’s ability to navigate these headwinds while advancing key development projects will be pivotal in shaping its medium-term trajectory.
These results build on Bathurst’s earlier half-year performance where it maintained full-year EBITDA guidance despite export headwinds and rising costs, as detailed in its H1 FY26 EBITDA of NZD 16m. The company’s commitment to the Buller Plateaux Continuation Project is further underscored by the recent confirmation of 11.8Mt coal reserves and mine life extension plans, positioning Bathurst for long-term supply continuity.
Meanwhile, the Tenas Project’s updated feasibility study released in late 2025, which saw a substantial increase in project valuation despite cost inflation, remains a cornerstone of Bathurst’s growth strategy and is progressing steadily through regulatory approvals Tenas Project NPV update.
Bottom Line?
Bathurst’s ability to sustain EBITDA guidance amid rising costs hinges on stable coal prices and successful project approvals; operational delays and legal risks warrant close monitoring.
Questions in the middle?
- Will Bathurst’s export volumes continue to offset domestic declines if fuel costs remain elevated?
- How will the Fast-track Approvals Act process impact the timing of the Buller Plateaux project development?
- What are the potential financial implications if the Talley’s Group litigation extends or escalates?