New Hope Corporation delivered a strong quarterly result with underlying EBITDA climbing 21.7 percent to $130.1 million, driven by a combination of higher production volumes, improved cost performance, and resilient coal pricing. The 5.0 percent increase in ROM coal production to 4.3 million tonnes and a 10.4 percent jump in coal sales to 3.2 million tonnes powered the earnings growth, while the average realised sales price of $140.7 per tonne held firm against the prior quarter despite the inherent volatility in global coal markets.
Operational efficiency gains were equally impressive. The Bengalla Mine delivered a 12.4 percent reduction in FOB cash costs, excluding state royalties, to $74.0 per sales tonne, suggesting the company is benefiting from improved mine productivity and operational discipline. Higher volumes combined with lower unit costs created a particularly favourable earnings dynamic that more than offset any modest movements in commodity pricing. The company also managed its product stocks effectively, reducing inventory by 26.9 percent to 4.0 million tonnes, which may free up working capital and improve cash generation in the near term.
New Hope took strategic advantage of the debt capital markets to strengthen its balance sheet. The company successfully issued $300 million in senior unsecured convertible notes due 2032 while concurrently repurchasing $293.3 million of existing notes maturing in 2029, effectively extending maturity profiles and securing additional capital at attractive terms. The available cash balance of $571.6 million, comprising $277.1 million in cash and cash equivalents plus $294.5 million in fixed income investments, provides substantial financial flexibility as the company navigates the current operating environment.
One area requiring careful attention is the company’s safety performance trajectory. While the high potential event frequency rate improved to 1.21 from 4.85 in the prior quarter, the all-injury frequency rate rose to 37.66 from 35.20, with the 12-month moving average climbing to 31.30. The total recordable injury frequency rate also deteriorated to 4.43 from 3.80. Mining operations inherently involve safety risks, and the upward trend in injury rates warrants close monitoring to ensure the company’s safety protocols remain fit for purpose as production volumes increase.
Investors should track whether New Hope can sustain its cost momentum through the remainder of the financial year and how management deploys its fortress cash balance, particularly given evolving thermal coal demand trajectories in key export markets. The company reported 11 notifiable incidents during the quarter, and the Board should remain focused on reversing the trend in injury frequency rates. The announcement is price sensitive and flagged as material by the ASX.
View the full ASX announcement (PDF)
About New Hope Corporation Limited (ASX: NHC)
New Hope Corporation is an Australian thermal coal miner operating the 100% owned New Acland coal mine in Queensland and the 80% owned Bengalla coal mine in New South Wales. The company sells the majority of its thermal coal production to seaborne export markets throughout Asia, and also engages in port handling, logistics, oil and gas development and production, and agricultural operations.
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