Unprecedented flooding hampers Whitehaven Coal (ASX:WHC)’s FY21 guidance

Geological difficulties and rain damage have pressured Whitehaven Coal (ASX:WHC) to lower the company’s expectations for FY21 production, sales and unit costs.

Whitehaven’s FY21 guidance of the total run-of-mine production volume in the state of New South Wales has been downgraded from 21.4 to 22.0 megatonnes, to 20.6 to 21.4 megatonnes

Whitehaven (ASX:WHC) has identified recent flooding in NSW and related equipment failures as justification for its four-week production hiatus at the Narrabi mining site. Previously, the mining project experienced regulatory woes with NSW mining authorities for Whitehaven’s logistical errors on the site.

The unprecedented rainfall and floods have also affected railroads and port facilities, hampering the transportation of products and equipment.

This has resulted in increased expenses, lifting unit cost guidance from $69 to $72 to $73 to $75 a tonne.

The ASX-listed coal miner has dropped its forecast for coal sales from 18.5 to 19.0 megatonness to 17.8 to 18.3 megatonnes.

Expected managed coal sales have been lowered to 17.8 to 18.3 megatonnes, down from 18.5 to 19.0 megatonnes.

Shares in Whitehaven Coal (ASX:WHC) are trading 12.6 per cent lower at $1.61

 
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Source: Finance News Network