New Hope Corporation Ltd (ASX: NHC) shares are on the move on Monday.
At the time of writing, the ASX 200 mining stock is down 7% to $3.66.
This follows the release of the coal miner's third quarter update.
Image source: Getty Images
ASX 200 mining stock sinks on results day
For the three months ended 30 April, New Hope reported group saleable coal production of 2.8Mt. This is in line with the previous quarter.
This was achieved with a Bengalla Mine cash cost (excluding state royalties) of $75.30 per sales tonne, down 1.7% from the previous quarter.
However, this cost reduction was offset by weaker coal prices. The ASX 200 mining stock's third quarter average realised sales price was $147.5 per tonne, which was down 7.3% on the $159.10 per tonne it recorded in the previous quarter.
This ultimately led to New Hope posting a 27% decline in quarterly underlying EBITDA to $155.2 million.
At the end of the period, New Hope's cash balance stood at a hefty $659.3 million. This comprises $287.6 million in cash and cash equivalents and $371.7 million in fixed income investments.
Coal price outlook
Commenting on the outlook for coal prices, management said:
Economic uncertainty continues to weigh on the thermal coal market. Excess supply during the quarter has been clearing and it appears the market is finding its floor. The Company's forward sales book remains well supported, with majority of production for the next six months sold, providing a level of protection against the discounts being experienced by those selling into the spot market.
The Company moves into the coming quarter anticipating a more balanced market, with increased demand expected during the Northern Hemisphere summer.
Guidance downgrade
Putting additional pressure on the ASX 200 mining stock this morning has been an update on its guidance for FY 2025.
According to the release, the New Acland mine has been impacted by challenges with rail capacity and performance. This is going to prevent it from achieving its guidance for the year.
As a result, total saleable coal production is now expected to be 10.58Mt to 11.57Mt. This is down from its previous guidance range of 10.83Mt to 11.87Mt. In addition, coal sales are expected to be 10.41Mt to 11.45Mt instead of 10.66Mt to 11.75Mt.
Following today's move, the New Hope share price is now down 26% over the past 12 months. This compares to a 6.5% gain by the ASX 200 index over the same period.
