New Hope Group, which has struggled against the political wind to get approval for its Acland stage three coal mine expansion, has produced a $983 million net profit on the back of record prices for thermal coal and now has $715 million in cash and a net asset position of $2.3 billion.

The company’s shares rocketed 7 per cent when the market opened this morning.

The company’s pre-tax profit was $1.4 billion and the result is likely to feed into the debate about windfall profits for mining companies and the State Government’s decision to hike coal royalties.

The result was achieved with significantly less coal produced because of bad weather, Covid-19 restrictions and the end of mining at its Acland stage two mine. It also purchased coal to take advantage of pricing dynamics and to mitigate demurrage costs.

Chief executive Rob Bishop said the company’s “exceptional cash position” would mean it was able to deliver to shareholders a 31 cents a share dividend, along with a 25 cents a share special dividend, both fully franked.

”The company revealed that its fourth quarter delivered prices of almost $A500 a tonne for its coal while its annual average was a record $US281 a tonne ($A417), a 176 per cent increase on the previous year.

“With security of supply paramount to our key customers, our outlook is strong with a largely sold and optimally priced forward sales book for the next 12 months,” the company’s annual report said.

“The current energy crisis has highlighted the need for increased domestic supply. The company has responded by increasing sales to the domestic market and looks forward to increasing domestic sales if approvals for for New Acland stage three are granted.”

“As part of its broader capital management strategy, the company is also looking at options to return a portion of its surplus capital to security holders,” New Hope said.

It said it has several options and said it could also use the funds on mergers and acquisitions