Simple announcement with plenty of information, which is also application to other coal companies like WHC.
YAL had AU$1.5b cash at end of year 2021. AU$930 million was paid as dividend in April, leaving about AU$570m.
Assuming everything else constant, and the AU$570 cash in hand as operational cash for YAL, we've generated US$801m of FCF in 6 months period, or possibly more, which is used to pay off the loans.
Note that YAL only had US$25m compulsory payment in July 2022. Assuming YAL did not pay off the $US801m, and instead pay it off as dividend.
To be conservative.that YAL shareholders could be looking at interim dividend of 50% of FCF, let's make that US$350m.
And if directors deem YAL's balance sheet is sound, an addition of >25% NPAT will be added. Give that an easy US$150m to top it up to total of US$500m interim dividend. We're looking at AU$730m as interim dividend, 78% of what was paid in 2021 as final + special dividend in 2021.
I think all these info is enough for me to sleep like a baby every night knowing I'm heavy in coal stocks, which are undervalued and generate strong FCF despite of all the noises in stock market.
YAL Price at posting:
$5.11 Sentiment: Hold Disclosure: Held
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