Financial Data and Key Metrics Changes - The company is tracking to be in the upper half of the production guidance range of 35-39 million tons for the full year, potentially reaching the upper quartile [4] - Cash operating costs were AUD 93 per ton at the half-year, consistent with the guidance range of AUD 89–AUD 97 per ton [4][16] - The company ended the quarter with a cash balance of $1.8 billion after paying an interim dividend of approximately $82 million [16] Business Line Data and Key Metrics Changes - The company produced 15.8 million tons of ROM coal, translating to 12.3 million tons of salable coal, with an attributable share of 9.3 million tons, all in line with forecasts [7][9] - Attributable sales volume was 10.7 million tons, which was 31% higher than the June quarter, recovering from previous delays [11] Market Data and Key Metrics Changes - International coal prices remained under pressure, with average realized prices for thermal coal at AUD 130 per ton and metallurgical coal at AUD 195 per ton [15] - The average prices for the indices improved marginally, with the API 5 index averaging $69 per ton and the Global Coal Newcastle index averaging $109 per ton [14] Company Strategy and Development Direction - The company aims to maximize operational performance and drive value generation for shareholders, focusing on maintaining controllable cost discipline [3][4] - The company is exploring opportunities for growth, particularly during cyclical downturns, while maintaining a strong financial position [42] Management Comments on Operating Environment and Future Outlook - Management acknowledged external and temporary cost pressures affecting cash operating costs but remains optimistic about maintaining costs within the guidance range [4][16] - The company is positioned well for an upswing in coal prices, with a strong operational performance and disciplined cost control [62] Other Important Information - The company has achieved a downward trend in total recordable injury frequency rate, which was 5.71% at the end of September, below the industry average [6] - The company is maintaining a strong financial position with no interest-bearing debt and good access to debt markets [62] Q&A Session Summary Question: Breakdown of cash costs and transportation costs - The CFO indicated that cash operating costs remain consistent, with some savings from diesel, but transportation costs are impacted by wet weather and port usage [20][22] Question: Inventory levels and sales recovery - The company reported that sales volumes were recovered in Q3 due to previous delays, and they are in a comfortable position regarding unsold inventory [28] Question: Capital expenditure for the third quarter - The CFO confirmed that capital expenditure is consistent with guidance and is primarily driven by fleet upgrades and heavy equipment [33] Question: Changes in production cost expectations - Management noted that while they previously hoped to move below the midpoint of the cost guidance, they now expect to remain around the midpoint due to external pressures [44] Question: Outlook on Queensland royalties - The CFO stated that there are no anticipated changes to Queensland royalties at this time [57] Question: Potential mergers and acquisitions - Management reiterated that they do not comment on specific scenarios but are exploring opportunities in the context of the current market conditions [55][56]
YANCOAL AUS(03668) - 2025 Q3 - Earnings Call Transcript