WHC +3.84%: hit ~11 month highs today on the back of a reasonable 2Q production report. The company managed 3.89Mt in coal sales in the quarter, up 17% from 1Q and marginally higher than the same period in the prior year. Pries were ~5% lower vs 1Q on average with some weakness across coal markets despite commentary that demand has remained resilient. While production was a touch better than expectations, Narrabri disappointed and guidance for the year was cut 10% as a result. Maules Creek picked up some of the slack though costs are expected to be higher in FY24 as a result of a shift from open cut to underground. The market seemed pleased with the company’s plans to pair back capex intentions as they digest the acquisition of Daunia and Blackwater from BHP, expected to complete the deal in April. Overall, the update was slightly better than expected while WHC remains cheap in our view.
MM remains long and bullish WHC
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