Fortescue Metals (ASX:FMG) smashes iron ore shipments, upgrades FY22 guidance

Company News

by Melissa Darmawan

The world’s fourth largest iron ore producer, Fortescue Metals (ASX:FMG) smashed record shipments for the June quarter exceeding their benchmark, defying weather troubles banking US$6.9 billion.

The miner posted iron ore shipments of 49.3 million tonnes for the quarter and spilled over its guidance by 0.1 per cent to 182.2 million tonnes for FY21, versus their guidance of 182 million tonnes.

Fortescue did undergo a balance sheet repair last year with cashflows building the net cash position to US$1.0 billion at 30 Sep 2020.

With numbers today, the $80 billion miner added $US3.3 billion to its cash balance in the June quarter alone with the help of shipments from its Pilbara operations driven by strong demand in China. 

The single commodity producer received US$167.95 a tonne for this quarter, a jump of 17 per cent compared to the March quarter or if you’re comparing it to the average benchmark, they call this Platts, the miner saw a 84 per cent spike of US$200.01 a tonne.

Looking ahead, the miner is looking bullish with their FY22 guidance with its iron ore shipments to perform between the range of 180 to 185 million tonnes along with a number of other metrics.

Fortescue chief executive officer, Elizabeth Gaines, said “the Fortescue team has delivered excellent results for the June quarter, with record quarterly shipments of 49.3 million tonnes contributing to our highest ever annual shipments of 182.2 million tonnes in FY21”.

“This was an outstanding performance despite the impact of wet weather, as well as COVID-19 restrictions requiring many of our team members to remain on site for extended periods during WA’s lockdowns. We greatly appreciate the ongoing cooperation of the entire Fortescue family as we continue to manage the impacts of COVID-19”.

“The strength of the operating performance, combined with record average revenue resulted in strong free cashflow generation in the June quarter as demonstrated by the movement from a net debt position at the end of March of US$1.0 billion to net cash of US$2.7 billion at 30 June”.

Shares in Fortescue Metals (ASX:FMG) are trading 2.2 per cent higher at $26.38.

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