ASX-listed Yancoal Australia increased coal production in 2025 but reported sharply lower earnings as weaker international coal prices weighed on revenue and margins.

For the year ended December 31, the company delivered record run-of-mine production of 67-million tonnes on a 100% basis, up 7% from 2024. Saleable production rose 6% to 50.8-million tonnes, while attributable saleable output increased 5% to 38.6-million tonnes, placing the result in the top quartile of guidance.

Despite the stronger volumes, revenue declined 14% year-on-year to A$5.95-billion, reflecting a 17% fall in the realised coal price to an average of A$146/t. Thermal coal achieved an average price of A$136/t, down 15%, while metallurgical coal averaged A$203/t, down 26% from the prior year.

Operating earnings before interest, taxes, depreciation and amortisation (Ebitda) fell 44% to A$1.44-billion, with the Ebitda margin compressing to 24%, compared with 37% in 2024. Profit after tax decreased 64% to A$440-million.

Cash operating costs, excluding government royalties, decreased 1% to A$92/t, below the mid-point of guidance. The company attributed the cost performance to increased volumes and productivity improvements, partly offset by higher demurrage costs during the middle of the year.

Yancoal ended the year with a cash balance of A$2.1-billion, down from A$2.46-billion at the start of the year, after returning A$769-million to shareholders through dividends during 2025.

The board declared a fully franked final dividend of A$161-million, or A$0.122 a share, bringing the total payout ratio for 2025 to 55%, in line with its dividend policy.

Commenting on the results, CEO Sharif Burra said the company delivered record coal production in 2025, close to the top of its guidance range, supported by its highest first-half production in five years and a record fourth quarter.

The company aims to carry operational momentum into 2026, with attributable saleable production guidance set at 36.5-million to 40.5-million tonnes. Cash operating cost guidance for the year is A$90/t to A$98/t, allowing for some cost inflation, while attributable capital expenditure is forecast at A$750-million to A$900-million, including expenditure deferred from 2025.

Although international coal markets remain well supplied, the CEO noted that coal price indices have recently improved. The company said it would continue to work with customers to optimise its product mix in response to market conditions.