Q1 2025 Whitehaven Coal Ltd Production Report Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Rahul Anand - Morgan Stanley Australia Ltd - Analyst : My first question was around your sellable production versus Romco production. So there seems to be a bit of a mismatch there. Is there any color you can provide on that in terms of -- is this a timing impact or are you trying to build some ROM inventories that are going to stay with us for some time? So there might not be a full reversal in the coming quarters. That's the first one.

Question: Rahul Anand - Morgan Stanley Australia Ltd - Analyst : Even at the group level, Paul, if you look, you did 9.6 million tons of ROM coal production, saleable coal production was about 7.1. And then obviously you had a bit of a mismatch across assets. So I was just trying to figure out whether there is some kind of a ROM build here or is this going to be, or is this purely just timing?

Question: Rahul Anand - Morgan Stanley Australia Ltd - Analyst : Excellent. Okay. And look, the second one was just around the production. So, if we think about Narrabri, you flagged an additional two weeks shut. So just wanted to get a bit more color in terms of what that will achieve. Obviously, the mine performed quite well this period and then just to follow up there on malls. In terms of the mall, mine plan, was there any change because we received guidance very recently and at that time, it wasn't flagged, but it was a first half, second half split. So just wanted to know how that came about. Thanks. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 24, 2024 / 11:30PM, WHC.AX - Q1 2025 Whitehaven Coal Ltd Production Report Call

Question: Paul Young - Goldman Sachs Group, Inc. - Analyst : First question on Blackwater had a really good quarter from a run of mine perspective. And I know you've spoken about two excavators that you're commissioning this quarter. Is there anything else you want to call out from a perspective of just one quarter in now of owning the asset into the New year? Just how the dragline police performing all the and prestrip trucks and, and coal mining trucks. Anything else to call out on that asset? I mean, considering that I think after this quarter, it probably actually should do better even next quarter.

Question: Paul Young - Goldman Sachs Group, Inc. - Analyst : Okay. Yeah, good stuff, Paul. And then and second question on sales volumes and also cost guidance. I just sticking with Blackwater, sales improve, but I just based on the Gladstone export data during the quarter, I thought Blackwater had done a little bit better, but it's a timing thing and it's a big mine, so the sales probably will come through but your cost, are based on sales volumes, not production. So, the fact that sales at the group level were probably, in line with whatever I was expecting that probably tells me that your absolute costs are probably coming in a little bit under, to, versus expectations. Is that correct? So if you can just maybe help us all just around, why cost tracking to the bottom end is that I presume it's presume it's Queensland and absolute cost coming in into the done.

Question: Jonathon Sharp - CLSA Limited - Analyst : Just the first question -- just with the BMA payments. I suspect I know the answer to this but just want to confirm it that you'll have to make 100% of the payments to BMA and not 70%. Can I just clear that up, please?

Question: Jonathon Sharp - CLSA Limited - Analyst : That makes complete sense. Thank you for that. And just the second question on Narrabri, does that makes sense that you're going to eight weeks with just how many supports are coming to the service, even just percentage wise? And can I just confirm it isn't due to any development, discontinuity, it is due to hydraulic health. And just with that, will it be a hard stop after eight weeks or is timing dependent on maintenance completion?

Question: Robert Stein - Macquarie Securities (Australia) Ltd. - Analyst : Hello, team. First question just on realized pricing. So most that your sales mix for Queensland in the quarter was 55% of Queensland operations. Yet you still achieved a number pretty close to 85%. Can you just provide a bit of comment on that? Given that the acquisition deck had a much higher target of a HCP mix but similar types of realization.

Question: Robert Stein - Macquarie Securities (Australia) Ltd. - Analyst : But fair to say even with your time lags on pricing and the losses if you were to trend up to that [65%] target. You should sort of realize closer to that 90% -- yeah, range at 85% to 90% but you should achieve a number a bit higher to that 90% mark.

Question: Robert Stein - Macquarie Securities (Australia) Ltd. - Analyst : For the hard Coke. Yes.

Question: Robert Stein - Macquarie Securities (Australia) Ltd. - Analyst : And then, just on Maules Creek, note that mine plan sequencing is never smooth even on a quarterly basis. It can be quite lumpy. Can you sort of provide an indicative profile for the rest of the year around how you would expect to see that to get back to even if it's flat year on year production?

Question: Lyndon Fagan - JPMorgan Securities Australia Ltd. - Analyst : Good morning, Paul. First one I've got is just on the Blackwater sell down. Is there any tax on that?

Question: Lyndon Fagan - JPMorgan Securities Australia Ltd. - Analyst : Okay. That's a good one. And then just on the Queensland cost there, you've talked about headcount reduction in terms of the initiatives this year that are leading to the saving. Do you mind just giving a bit more color on what that is?

Question: Lyndon Fagan - JPMorgan Securities Australia Ltd. - Analyst : Yeah. Thanks for the detail. Just a quick follow up. How much of the saving relates to people cuts?

Question: Glyn Lawcock - Barrenjoey Pty Ltd. - Analyst : Morning, Paul. Just a couple of quick ones. Firstly, maybe one to Kevin. Just in the quarter was there anything other than the dividend payment that went out that was exceptional in the quarter? And then is the stamp duty still due in the second quarter? And just to refresh my memory, what that amount is? Thanks.

Question: Glyn Lawcock - Barrenjoey Pty Ltd. - Analyst : So if you net off the payment to BHP, it's about a couple of $100 million at least cash generation in the quarter.

Question: Glyn Lawcock - Barrenjoey Pty Ltd. - Analyst : Yeah. And then just talking about the operational quarter then up in Queensland. I mean, 21 million tons of rom manualized above the top end of your guidance for the year. Is there anything that we should think about that you can't hold the September quarter all the way through?

Question: Glyn Lawcock - Barrenjoey Pty Ltd. - Analyst : Yeah. I appreciate your railings have picked up, but you've actually now built 1 million tons of finished coal in six months. Is that replenishing finished stocks or is that 1 million, you think you can unwind over the remainder of the year? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 24, 2024 / 11:30PM, WHC.AX - Q1 2025 Whitehaven Coal Ltd Production Report Call

Question: Chen Jiang - BofA Securities - Analyst : Good morning, Paul and Kevin. Congrats on the strong quarter for the Queensland co-operations. Just one question Narrabri Stage 3 extension program. You made a comment earlier at the start that there's a decision pending whether to use the current longwall. I'm just wondering, I know you will provide updates you mentioned at the end of the first half '25 results. But regardless of your decision, will that impact your CapEx guided for $800 million?

Question: Chen Jiang - BofA Securities - Analyst : Okay, that's good to hear. So I guess which means there's a downside risk to your -- I mean reversion downside to your original CapEx, which has different mining methods planned for that $800 million.

Question: Daniel Roden - Jefferies LLC - Analyst : I just wanted to on the weather, I guess, planning. Are you able to, I guess, provide a bit of guidance on the number of weather days you forecast when providing guidance. That kind of goes into annual production targets. Is that something you're able to kind of outline? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 24, 2024 / 11:30PM, WHC.AX - Q1 2025 Whitehaven Coal Ltd Production Report Call

Question: Daniel Roden - Jefferies LLC - Analyst : Yeah. Okay. And definition of average in that context is that last couple of years last 35 years averages because probably the last couple of years have been elevated rainfall depending on the time horizon you are from. No one here is a weather expert. But if you were forecasting that out, if it was average on 10 years is different than average on three years.

Question: Daniel Roden - Jefferies LLC - Analyst : Yeah. No, understood and thank you. And I just wanted to touch on the last couple of -- last quarter you were talking about building large stock inventory at Blackwater for the 2x that are there now. I just wanted to get a sense from the cost front, I would have expected that to have resulted in an increase operating costs at the site. The verbal commentary that hasn't really (inaudible) so I guess have you brought on additional blasting capacity? And when was that brought on in the quarter? And how is that translated into your cost base there? And I guess directionally, would you expect costs of black water to increase quarter on quarter into December? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. OCTOBER 24, 2024 / 11:30PM, WHC.AX - Q1 2025 Whitehaven Coal Ltd Production Report Call

Question: Daniel Roden - Jefferies LLC - Analyst : Yeah. No. Perfect. But makes a lot of sense and that's a color. And maybe just finishing off from my side. Can you maybe just touch on the coal markets? You mentioned that you're seeing that Incredible India buying and increased trade activities in market. Just interested in that sense. I guess, coming into the end of the year, it's traditionally a season when that pricing has reacted it quite positively and I don't think you've seen those physicals kind of translating through. Maybe can you just provide a bit more color on what demand you're seeing from, I guess, India and your other export markets as well and what your expectations are internally for that?

Question: Glyn Lawcock - Barrenjoey Pty Ltd. - Analyst : Thanks Paul for allowing me to double dip. Just on Narrabri. Obviously, not buying another longwalls must be lower CapEx. I'm sure there must be an offset on the other side otherwise we wouldn't have done it in the first place. Is that come with higher cost if you think because you're trying to nurse a long wall all the way through.

Question: Glyn Lawcock - Barrenjoey Pty Ltd. - Analyst : Okay. And then just a quick one just on the New South Wales pricing. Now that whereas Creeks out of the portfolio, I would have thought you're only selling better than GC new quality coal. You've got the higher energy, the low ash. So I would expect you now to be getting a premium. Was it something in the quarter? Just timing because the price ran up or what? Because that should be the case now, shouldn't you get a premium?

Question: Robert Stein - Macquarie Securities (Australia) Ltd. - Analyst : Hi guys. Thanks for the second. In terms of the yields, the rolling yield for Queensland, is that a 12 month rolling yield? It's still including BHP's operational data. And the reason I ask is that if I look at your ROM to obviously saleable coal production, which you talked about increasing ROM stock. Just trying to sort of quantify how much ROM stock build you have there that sort of gets created noting that your yields were flattish if not up, but yet, obviously the ROM numbers were significantly up on saleable coal production.

Question: Robert Stein - Macquarie Securities (Australia) Ltd. - Analyst : Yeah. So if I get back from the ROM side, if I take saleable coal production and multiply it by the yield, I should get theoretically how much ROM went through the wash plant as you would expect and then the delta between that and ROM coal production relates to ROM coal. That's right?