Australia’s New Hope shares hit 3-1/2-year high on hefty dividend

Australian coal miner New Hope Corp (ASX:NHC) shares reached a three-and-a-half-year high on Tuesday, buoyed by a larger-than-anticipated final dividend and a more optimistic production outlook. The company's shares climbed 3.3% to A$6.49, marking their highest level since late-January 2023, despite a sharp dip in annual profit. The S&P/ASX 200 energy sub-index, however, slipped by 1%.

Weaker coal prices and higher depreciation contributed to a substantial decline in annual profit, which fell by 63.4% to A$161 million. Analysts had expected a profit of A$182.2 million. Revenue remained relatively stagnant at A$1.77 billion, slightly down by 0.5%. Realised coal prices, including hedging, dropped by 10% to A$145.20 a tonne, leading to a 30.1% decrease in underlying margin to A$45 a tonne. Rising depreciation and amortisation, reaching A$238.7 million from A$191 million, further strained the operating line.

Nevertheless, volume growth helped mitigate some of this pressure. Saleable coal production rose by 7.6% to 11.5 million tonnes, while coal sales increased by 11.8% to 11.8 million tonnes. New Hope declared a 30-cent fully franked final dividend, surpassing the consensus estimate of 15.9 cents by nearly 89%. Including the interim 10-cent payment, ordinary dividends declared for FY26 totaled 40 cents per share, up from 34 cents a year earlier.

New Acland, a project, is set to ramp up to about 5 million tonnes a year, while Bengalla returned to a 13.4-million-tonne annualized run rate in the second half after a pit-sequence realignment. Additionally, New Hope is exploring options to extend Bengalla beyond its existing approvals.