Pretty great cash flow numbers, I wish they were true.
I believe you have mistaken revenue for EBITDA in your above calculations, essentially leaving out royalty, rail, shipping, operating expenses and some $50M in other expenses and another $50M in financing expenses related to lease agreements. Rail, port and marketing expenses added up to about 16% of revenue last FY compared to 28% for the previous FY. It seems the higher the revenue the lower the cost, however I will stick with this 16% in my below calculations as a conservative move.
I will also stick with A$96 per ton cost operating expenses and do all calculations based on 14.1 M tons equity sales. I will use the current 950M outstanding shares for calculations.
Mistaking Revenue for EBITDA throws off the final FCF considerably, in your final calculation if you had written "pre capex and tax" rather than "post capex and tax" your numbers would have made sense. Below is my version of the numbers while keeping most other assumptions as above. Coal purchases are ignored. I will calculate the EPS as that is what I am more familiar with.
Average Coal price received for the full year,
US$400 - Revenue - A$8.05B, EBITDA - A$5.36B - post capex and tax - A$3.34B (EPS $3.51, PE of 10 = $35 SP)
US$350 - Revenue - A$7.05B, EBITDA - A$4.52B - post capex and tax - A$2.76B (EPS $2.90, PE of 10 = $29 SP)
US$300 - Revenue - A$6.04B, EBITDA - A$3.67B - post capex and tax - A$2.16B (EPS $2.27, PE of 10 = $22 SP)
US$250 - Revenue - A$5.03B, EBITDA - A$2.83B - post capex and tax - A$1.57B (EPS $1.65, PE of 10 = $16 SP)
In all these scenarios, management is likely to return 40-50% to shareholders via dividends or buybacks. In my opinion, regardless of which of these average prices we achieve, WHC is still an exceptional investment today. For example, in August 2018 when WHC released its full year report it was trading at $5 with a reported EPS of 52cents. SP rallied to $5.33 within a month, taking PE ratio to almost 11 before falling on the next down cycle. With ESG momentum waning in the face of global fuel shortages, I believe that coals reputation will be far better in the future than what it was in 2018, it is now purported as the savior to many problems and I would expect our PE ratio to peak above 11 this time.
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