Whitehaven Coal Limited

Hello and welcome to this short overview of Whitehaven's 2020 financial year results. First, our safety performance. Nothing is more important than making sure that at the end of each shift, our people return home safely to their families and loved ones. As we've said all along, Greater production without better safety is not sustainable. With this as a key focus of our business and COVID-19 as a backdrop, it was fantastic to achieve our best ever safety result. Our TRIFRA of 4.13 represents the number of injuries requiring medical treatment per million hours worked and was our lowest ever recorded. This result is a credit to our team and the strong safety culture we are continuing to build across all of our sites. We know we can do better, but we need to keep pushing hard to achieve an even safer workplace. So I thank all of our employees for seamlessly adopting the new hygiene and distancing requirements. As the largest private sector employee in our region, keeping our people safe is contributing greatly to keeping the community safe. And our positive role in the regional economy is more important than ever. Notwithstanding the challenges posed by the continuing pandemic, our business has shown great resilience. Maintaining our production levels means keeping our people in work and benefits the countless local businesses that depend on our presence. And despite ongoing drought, bushfires, flooding rains, and of course COVID-19, we've achieved our production and sales guidance. Our managed coal production totaled 20.6 million tonnes and managed coal sales, excluding purchased coal, scaled to 17.5 million tonnes. Other highlights for the year include our Narrabri underground mine recording its second million tonne month in its relatively short history. Our large open-cut operation, Mauls Creek, also saw a record in the fourth quarter with 4.2 million tonnes of ROM production and we continue to trial autonomous haulage systems at Mauls Creek. Our reported earnings for the year finished up at $306 million, which was down 69% on FY19. This translated to a net profit after tax of $30 million. The single biggest influence on our earnings for the year was of course the coal price, which is now at cyclical lows due to ongoing trade dysfunction and now overlaid by the impact of COVID-19 in our export markets. In these circumstances, it is important we observe a disciplined approach to capital allocation and maintaining a strong balance sheet. At the end of the financial year, our net debt stood at $787 million, which now includes $216 million of equipment finance leases. Our billion dollar corporate facility was drawn to $638 million at the end of June. With $362 million undrawn and an additional $107 million in cash reserves, we have a solid liquidity position. To maintain our strong balance sheet, the Board has made the decision not to declare a final dividend for this year. However, with the interim dividend of one and a half cents paid in March this year, we've still met our dividend policy of 20% to 50% of MPAT. With some of our smaller mines, we've reached the end of their lives. Our business is oriented towards optimising our existing operations. This includes potentially taking Malls Creek to 16 million tonnes per annum, extending the life of our Narrabri mine to 2044 and running Tarrawonga at 3 million tonnes per annum. Strategically, we are taking the necessary steps to deliver on our key development assets, Vickery and Winchester South. With our 10 million tonne per annum metallurgical and thermal coal Vickery project gaining approval from the New South Wales IPC in August, it is now proceeding through the federal approvals process. I want to thank all of our shareholders for their continued valuable support. These are testing times to be sure, but by maintaining capital discipline and focusing on productivity and cost reductions on an expanding portfolio, we can be confident of driving strong returns in the future.