Published: November 8, 2018 |

[Click image to enlarge]

Gina Rinehart’s sprawling iron ore and cattle interests have delivered her private company Hancock Prospecting a 28 percent surge in annual profit to a massive USD 1.37 billion. The company’s annual report lodged with the Australian Securities and Investments Commission late yesterday revealed Hancock had posted annual revenue of slightly more than USD 6 billion, up 36 percent on the previous year. The improved result reflects Hancock’s majority stake in the Roy Hill iron ore operation in the Pilbara, which achieved nameplate capacity of 55 million tonnes per annum in September last year. Hancock holds a 70 percent stake in Roy Hill, which delivered a 68 percent profit hike to USD 558 million last financial year on revenue of USD 3.84 billion. The improved profit follows the company’s maiden profit of USD 331 million the previous year.

In a statement accompanying the Hancock results, the company said lenders’ completion for Roy Hill was achieved this year, and the project was utilizing the majority of its cashflow to reduce its debt pile of nearly USD 7 billion.

The company said that “As a result, Hancock’s Roy Hill’s project debt has reduced by nearly USD 800 million from the previous year, and the group’s overall gearing ratio has reduced from 86 percent to 71 percent. Roy Hill maintains significant cash balances. The use of this cash is restricted while debt facilities are in place.”

Hancock downplayed the impact of discounts for lower grade iron ore, saying its Roy Hill had continued to achieve an average 90 percent price realization against the benchmark 62 percent Platts price over the year.

It said that “A substantial proportion of Roy Hill’s product is shipped to mature markets in Japan, South Korea and Taiwan through long-standing arrangements with HPPL’s investment partners in Roy Hill.”

Roy Hill said it employed 1897 staff, up from 1394 the previous year and paid $8.2 million to “key management” down from $10.9 million the previous year.

Hancock revealed it paid $860 million in Federal and State taxes over the 2017/18 financial year and noted Mrs Rinehart paid more tax personally and through Hancock than any other Australian.

The company’s statement said that “HPPL is one of the most successful private companies in Australia’s history, and the most successful private mining and agriculture company in Australia’s history.” Hancock’s Hope Downs iron ore joint venture with Rio Tinto in the Pilbara was also a significant contributor to its profit as it continued to operate at or above its 45Mtpa nameplate capacity. The company’s more recent investment in the Kidman cattle empire delivered underlying net profit of $10.1 million on revenue of USD 51.1 million.

Source: Steel Guru

To stop by Hancock’s website, CLICK HERE

Be in-the-know when you’re on-the-go!