Stanmore Resources has declared a fully franked interim dividend of 2.2 US cents per share after a strong third quarter cut net debt by US$53 million. Record South Walker Creek production, higher coal prices and progress on the US$105 million Moranbah South acquisition strengthened the company’s position heading into the final quarter.
- Net debt reduced to US$19 million as at 30 September
- Interim dividend of 2.2 US cents per share declared
- South Walker Creek set quarterly ROM and saleable production records
- Average sales price rose 6% quarter-on-quarter to US$163 per tonne
- Moranbah South acquisition remains conditional, with a US$100 million completion payment outstanding
Strong quarter unlocks Stanmore interim dividend
Stanmore Resources Limited (ASX:SMR) has moved from deferring its interim dividend to declaring a fully franked payout of 2.2 US cents per share, after a stronger third quarter improved cash generation and reduced net debt to just US$19 million.
The coal producer reported US$231 million in cash at 30 September, alongside total liquidity of US$501 million. Net debt fell by US$53 million during the quarter, helped by improved coal pricing, the second-half weighting of sales and a US$26 million stamp duty refund linked to the Eagle Downs acquisition.
South Walker Creek drives record production
Run-of-mine coal mined rose to 5.3 million tonnes for the quarter, while saleable production reached 3.4 million tonnes. South Walker Creek supplied the standout performance, producing a quarterly record 2.8 million tonnes of ROM coal and 1.9 million tonnes of saleable coal after Stanmore prioritised stripping and pit preparation earlier in the year.
Average sales price climbed 6% from the June quarter to US$163 per tonne, and was 18% higher year-to-date than in the same period last year. Stanmore attributed the market support to supply disruptions affecting key Russian and Chinese production basins. The company also recorded no serious accidents during the quarter, with its rolling 12-month Serious Accident Frequency Rate steady at 0.53.
Moranbah South adds a major funding test
The balance-sheet improvement matters because Stanmore is also progressing its proposed acquisition of 100% of the Moranbah South tenements from Exxaro Resources for US$105 million. The deal, which would add 724 million tonnes of Measured and Indicated Coal Resources next to Eagle Downs and the Isaac Plains Complex, was first announced in the Moranbah South acquisition and remains conditional.
Stanmore has paid an initial US$5 million and expects to fund the remaining US$100 million completion payment from its available resources. Completion is anticipated in the fourth quarter of 2026, subject to conditions including Exxaro completing its acquisition of Anglo American’s 50% interest in the tenements. The company says it intends to assess Moranbah South as part of a broader potential development with Eagle Downs once the transaction completes.
Guidance holds as refinancing supports liquidity
Stanmore reaffirmed its 2026 full-year saleable production guidance, with output tracking towards the top end of the range. Poitrel’s quarter was affected by a planned coal handling and preparation plant shutdown, while Isaac Plains benefited from operational changes after Stanmore assumed full control of mining activities at Isaac Downs.
The company also completed its debt refinancing during the quarter, drawing a new US$250 million term loan and extending the maturity of its US$200 million revolving credit facility. That financing work had previously been reported as improving flexibility through lower funding costs and extended maturities, but the dividend decision now puts the remaining Moranbah South payment alongside shareholder distributions in the company’s near-term capital allocation equation.
Bottom Line?
Stanmore enters the final quarter with stronger pricing, production momentum and liquidity, but the dividend and Moranbah South completion payment will test how durable that flexibility is.
Questions in the middle?
- Can South Walker Creek and Poitrel sustain production near the top of full-year guidance through the final quarter?
- Will Moranbah South complete on schedule and deliver the intended operating fit with Eagle Downs and the Isaac Plains Complex?
- How much of Stanmore’s improved cash generation can persist if metallurgical coal prices retreat from third-quarter levels?