Whitehaven on track for net cash position by March 2022

Whitehaven Coal is on track to fully repay its senior debt facility by February 2022 and record a net cash position by March 2022.

The company presented its latest financial details in addition to operation updates in its December quarterly report.

Managing director and chief executive officer Paul Flynn said coal prices continued at attractive levels through the December quarter and remain well supported for the near future given strong underlying demand and persistent supply-side disruptions.

“Cash generation has been strong, with the business expected to be net cash in the March quarter,” he said.

“Whitehaven has unfortunately not been immune to recent heavy rains that impacted large parts of regional NSW and QLD as La Niña made its presence felt for the second Australian summer in a row.

“While we remain very confident about ongoing favourable supply and demand dynamics, there is elevated uncertainty associated with COVID’s impact on workforce availability and resourcing through our supply chains.

“The strong balance sheet and robust market environment is an appropriate backdrop to provide an update on our capital management strategy with our half year
results.”

While operations were impacted by wet weather, and coal production experienced a decline across the company’s Narrabri and Gunnedah operations, strong coal prices continued to be of benefit.

Whitehaven achieved an average price of $211 a tonne for sales of own coal during the quarter, representing a 144 per cent increase on the previous corresponding period.

Prices hit a high of US$222/tonne in October before falling to US$159/tonne in November. The price rebounded in December to US$170/tonne.

“The rebound was caused by a combination of strong Asia based end user demand and production constraints due to wet weather and flooding in the Hunter Valley and Gunnedah Basin,” the quarterly report noted.

“Strong ongoing demand for all fuel types has also continued to buoy the coal market. Even at record prices, coal remains a more attractive and less expensive alternative to LNG [liquefied natural gas].