Key Highlights

  • Underlying EBITDA fell 32.8% to A$514.3 million for the year to 31 July 2026.
  • Net profit after tax fell 63.4% to A$161 million, as a weaker realised coal price and higher unit costs cut earnings.
  • The total FY26 Dividend was 40 cents per share, up from 34 cents, and the final dividend was fully franked at 30 cents.
  • An on-market buy-back of up to A$100 million was announced, supported by a large cash balance.

What does it mean when a coal miner's profit falls by almost two thirds in the same year it raises its dividend? New Hope Corporation (ASX:NHC) put that question in front of investors on 15 September 2026, when it reported FY26 results for the year ended 31 July 2026. Production and sales volumes rose, but a weaker realised coal price and higher unit costs cut Earnings sharply. The company still lifted its dividend and announced a share buyback, leaning on a large cash balance.

The FY26 result

Net profit after tax was A$161 million, down 63.4%.

The final dividend was 30 cents per share, fully franked, and the total for FY26 was 40 cents, against 34 cents for FY25. The company also announced an on-market buyback of up to A$100 million.

That balance is what supports the dividend and buyback even though profit fell. The distinction matters: dividends are paid from cash and retained earnings, and a payout that exceeds a single year's profit is only sustainable if the Balance Sheet and future coal prices support it.

Volumes up, price and costs against

Saleable coal production was 11.5 million tonnes, up 7.6%, and coal sales were 11.8 million tonnes, up 11.8%. Within that, Bengalla contributed 8.2 million tonnes on New Hope's 80% interest basis, and New Acland produced 3.3 million tonnes, up 17.3%. the company update also noted that the Maxwell project should contribute more as production ramps up, though it gave no FY26 figures for it.

The average realised coal price was A$145.20 per tonne, down 10%, and group free-on-board (FOB) cash costs were A$88.90 per tonne, up 7.9%. FOB cost is the cost of getting coal to the port and loaded.

What New Hope sells

New Hope is an Australian coal producer. Its principal operations are the Bengalla open-cut mine in New South Wales's Hunter Valley and the New Acland mine in Queensland, which has been returning to full production. The company's coal is primarily thermal coal, used for power generation, and it sells mainly into Asian markets. Revenue therefore depends on seaborne thermal coal prices, which are influenced by Asian power demand, gas prices, weather and the policies of large importers.

Because Bengalla is a long-life, low-cost operation, it forms the earnings base. New Acland is the growth lever: management has a target of about five million tonnes of saleable coal per year, up from 3.3 million tonnes in FY26. The company also has a longer-term group target of around 15 million tonnes of saleable coal a year, compared with 11.5 million tonnes in FY26.

Strategy and competitive position

New Hope competes with Whitehaven Coal, Yancoal and Glencore, among others, in the thermal coal market. Its advantages are an encouraging balance sheet with no sign of stress, low-cost production at Bengalla and a diversified set of assets. Its disadvantages include a heavy exposure to a single Commodity price, long-term regulatory and social pressure on thermal coal, and the need to extract higher volumes at higher unit costs.

The company said it plans to keep funding growth while paying dividends, supported by its cash position. That is a sensible approach for a cyclical business, but it relies on discipline: there is a risk that growth spending is made near a price peak.

Risks

Extra tonnes only help if prices hold.

Cost inflation, shown by the 7.9% rise in FOB cash costs.

Structural Demand risk for thermal coal as buyers diversify energy sources.

Regulatory, environmental and approvals risk, including for expansions.

Operational risk such as weather, rail and port constraints.

Capital allocation risk if growth spending or Buybacks are done at unfavourable prices.

What to watch next

The first quarterly update of FY27 should show whether realised prices and costs have improved, and the company's Annual General Meeting will usually offer guidance on production. The progress of New Acland towards its five million tonne target and the ramp-up of other Assets will be the clearest tests of the growth plan. Investors should also watch how the buyback is executed, since its size relative to cash is modest.

Whether the lower profit proves a trough or a new normal depends mostly on the coal price.