Geo Energy Resources (RE4) H1 2024 earnings summary

Executive summary

• H1 2024 revenue fell 29% YoY to US$169.4m and net profit fell 4% to US$26.8m; earnings included a US$18.0m gain from the sale of fully provided receivable rights.

• Heavy rain disrupted mining and transport; coal sales totaled 3.229m tonnes, with higher volumes expected in 2H as conditions turned drier.

• Cash profit margin was 23%, and an integrated infrastructure project advanced to support future capacity expansion.

Financial highlights

• Revenue was US$169.4m versus US$239.8m; gross profit was US$27.2m versus US$48.0m, down 43% YoY.

• Profit before tax was US$33.7m, down 24% YoY; net profit was US$26.8m, down 4% YoY.

• Other income was US$21.2m, including the US$18.0m receivables-rights sale and a US$0.5m forex gain; G&A rose to US$6.2m from US$4.9m.

• Finance costs rose to US$9.9m from US$0.07m, mainly following US$220m in term-loan facilities drawn in October 2023 for expansion and infrastructure development.

• Net cash used in operating activities was US$31.1m; period-end cash and cash equivalents were US$75.5m, excluding US$18.0m received on 1 July.

Outlook and guidance

• 2024 coal sales target remained 10–11m tonnes; sales increased from July as drier conditions began, with production averaging 35,000 tonnes/day in the last week of July from SDJ and TBR.

• 2024 production quotas were 8m tonnes for SDJ and TBR and 2.5m tonnes for TRA; an application sought to raise the SDJ and TBR quota to 8.5m tonnes.

• Integrated infrastructure targets completion between end-2025 and early-2026; plans include TRA output of up to 25m tonnes/year and logistics savings of up to US$10/t.

• At current coal prices, the infrastructure project was estimated to support US$400m–US$500m in annual EBITDA potential.