Whitehaven Coal Provides Update on FY2023 Guidance

Highlights:

• Whitehaven Coal has released an updated guidance for its FY2023 production figures.
• The company is facing labour shortages across the business.
• The additional operational constraints at Maules Creek have made matters worse.

Whitehaven Coal (ASX: WHC), the Australian coal mining company, has released an updated guidance for its FY2023 production figures. The update comes ahead of the company's March quarter production report, which is scheduled to be released on 21 April 2023.

Lower Than Planned Production in March Quarter:

Whitehaven Coal reported managed run-of-mine (ROM) production of 4.3 million tonnes (Mt) for the March quarter, which is lower than planned. The company is facing labour shortages across the business, but the additional operational constraints at Maules Creek have made matters worse. As a result, its production increased by only 9% relative to the December quarter.

Reasons for Lower Production:

The lower than expected increase in production at Maules Creek was caused by several factors including labour shortages, limited dumping locations that required manned and unmanned fleets to be kept separate, and intermittent weather interruptions in March.

Uplift in Volumes Expected in June Quarter:

Whitehaven Coal expects an uplift in volumes overall in the June quarter. Whitehaven Coal's full year

ROM production forecasts have fallen below the bottom end of guidance due to lower than expected volumes from Maules Creek in the second half of the year. As a result of this and lower stock levels, some sales volumes will be pushed into FY2024.

FY2023 Guidance Adjusted:

As a result of these developments, Whitehaven Coal has adjusted its FY2023 guidance for ROM production, managed coal sales, and equity coal sales. The cost guidance has also increased to reflect the changes in operational performance.

New FY2023 Guidance:

• The new FY2023 guidance for managed ROM coal production is 18.0-19.2 Mt, down from the previous guidance of 19.0-20.4 Mt.
• The new guidance for Maules Creek is 9.3-9.8 Mt, down from the previous guidance of 10.3-11.0 Mt.
• The guidance for managed coal sales is 15.3-16.0 Mt, down from the previous guidance of 16.5-18.0 Mt.
• The guidance for equity coal sales is 12.3-12.9 Mt, down from the previous guidance of 13.1-14.4 Mt.
• The unit cost of coal (excluding royalties) is expected to be AU$ 100-AU$ 107 per tonne, up from the previous guidance of AU$ 95-AU$ 102 per tonne.

March Quarter Production Report:

In its March quarter production report, Whitehaven Coal will report an average coal price of approximately AU$ 400 per tonne for the March quarter. The report will also show a net cash position of AU$ 2.7 billion as at 31 March 2023 after generating approximately AU$ 1.2 billion of cash from operations in the quarter.

Conclusion:

Whitehaven Coal's updated guidance for FY2023 production figures reflects the operational challenges faced by the company. The impact of labour shortages, operational constraints at Maules Creek, and intermittent weather interruptions have all contributed to lower than expected production figures. While an uplift in volumes is expected in the June quarter, lower than expected volumes from Maules Creek mean that some sales volumes will be pushed into FY2024.

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