Thank you for joining today's teleconference for the release of Mount Gibson Iron's financial results for the December 2022 half year. Mount Gibson Chief Executive Officer, Peter Kerr, will be leading the discussion and he's joined by Chief Financial Officer, Gillian Dobson, and External Relations Manager, John Forwood. Mr. Kerr will provide a brief overview, after which there'll be an opportunity to ask questions. Due to the time constraints, only institutional participants will be invited to ask questions at that time. A recording of the call will also be available via the Mount Gibson website shortly after completion of today's teleconference. Thank you, and go ahead, Peter.
Thanks, Lisa. Good morning, all, and thank you for joining us to discuss Mount Gibson's financial results for the December 2022 half year period. As usual, I'll give a brief overview before handing back to Lisa for any questions that anyone may have. Overall, as you'd be aware from our recent quarterly activities report, the December half year period was a transitional and positive one for the company. Increased high-grade ore production and shipments from Koolan Island have returned us to profitability, notwithstanding the impact on sales volumes and operating costs of the August 2022 crushing plant fire. We made the decision to keep mining at Koolan as we undertook the repair works, and we have built substantial high-grade ore stocks for crushing and accelerating our shipment rate in the near term.
At a headline level, net profit after tax for the December 2022 half year totaled AUD 7.4 million, compared with a net loss after tax of AUD 65.6 million in the prior corresponding half year period. Ore sales revenue rose over five-fold to AUD 152 million FOB, compared with the prior corresponding half. That's FOB being after shipping freight. That reflected a 61% increase in sales volumes and the higher average ship grade of 65% Fe, compared with the medium and lower grade products sold in the prior corresponding half year period.
The Koolan Island operation performed largely as expected in the circumstances, as the benefits of the prior year's significant investments in waste stripping and ground support facilitated increased high-grade ore production. Our interim processing arrangements delivered the crushed ore we needed to meet our baseline shipment target while the plant repairs were undertaken. As previously reported, cash and investment reserves totaled AUD 41.2 million as at 31 December, reflecting the investments made in the period in advanced waste stripping, ground support activities, crusher repairs, and the build of significant high-grade iron ore stocks ready for processing as the crusher comes back to full capacity. In relation to Koolan's financial performance, all sales in the half year comprised high-grade 65% Fe fines from the main pit, generating a profit before interest and tax of AUD 19.8 million. Excuse me.
The bottom line net cash outflow for the operation was AUD 25.2 million, significantly improved on the prior corresponding period, and reflecting the investment we made in the December half of AUD 67.2 million in building substantial high-grade ore inventories ready for crushing. By period end, these ore stockpiles exceeded 0.8 million tons and have a market value of well over AUD 100 million at current prices, once that material is crushed. We consider the decision to continue to build these high-grade ore stocks a prudent one that will allow us to accelerate sales over the course of calendar 2023 as our crushing capacity comes back online.
As iron ore production and sales have been rising, the main pit waste to ore stripping ratio, which is a major driver of cash costs at that operation, also reduced dramatically in line with the mine plan to just 3.5/1 in the December half year. This should decline further to average only 1/1 in the current June half and 1.2/1 over the remaining four-year life of the operation. This means our cost structure is inherently geared towards a steady reduction over time as our shipment rate increases. Cash operating costs averaged AUD 80 per wet metric ton sold FOB in the half year before inventory build, major projects, and royalties. We expect these unit costs to reduce further in coming years.
Positively, the iron ore market has also been moving in our favor since the end of 2022. The average price we realized from the 1.1 million wet metric tons of ore that we sold in the half year was U.S. $94 per dry metric ton FOB, so that was net of shipping freight and the equivalent to AUD 140 per ton FOB. This reflected the high grade of the material sold despite the 62% Fe iron ore prices falling to a three-year low in late October and early November of around U.S. $80 a ton CFR. Since then, we've seen a welcome recovery as China has eased its COVID restrictions, introduced further economic stimulus, and the outlook for steel demand has improved.
Accordingly, the 65% Fe fines index is currently around $146 a ton CFR, maintaining a grade-adjusted premium of 6% over the benchmark 62% Fe index. In addition, shipping freight rates from Koolan Island to China have also eased and are currently around $12-$10 a ton, down from an average of $15 a ton in the December half-year period. Over $20 a ton in the preceding half-year. With mine production continuing as planned, our priority is to promptly complete the crusher repairs to enable us to rapidly ramp up processing and shipments. The repairs have progressed well, and our interim processing arrangements, using the unaffected primary parts of the plant, have successfully enabled us to meet our interim baseline shipping rate of three vessels per month.
We have also engaged a mobile crushing provider to process stockpiled ore in parallel with the main plant to help catch up on sales deferred by last year's fire. Since the end of the half year, we have, however, incurred some slight delays due to transport logistics disruptions arising from the record flooding on the Kimberley mainland. Our normal barging services between Derby and Koolan Island were necessarily redeployed for the state government's emergency supply purposes for the local towns. The good news is that road transport between Broome and Derby, from where we barge to Koolan Island, has now reopened, and materials and equipment for the crusher repair and mobile crushing circuit are now arriving at the island. We are targeting to have the repairs completed around the end of the March quarter, subject to the usual wet season interruptions. Following this, our monthly shipment rates will accelerate.
In relation to insurance cover for the crusher fire and the resultant business interruption impacts, Mount Gibson maintains relevant insurances for the Koolan Island operation and since the end of the half year period, we have received an initial progress payment of AUD 2.6 million, covering the first part of the repair works, with further progress claims to be made in due course. While Koolan Island remains our primary focus, our Midwest business also made a positive contribution in the period. The business unit generated a profit before interest and tax of AUD 1.4 million, and that reflected the rail credit income of AUD 4.3 million and other income from third-party use of Mount Gibson's Geraldton port facilities. The total rail credit received to date is approximately AUD 28 million. That's over the last few years.
It accrues at around AUD 2 million per quarter. We expect to reach the total capped amount of approximately AUD 35 million later this calendar year. We also continue to receive and consider external inquiries about our Midwest infrastructure assets and remain in discussions regarding further third-party arrangements to generate additional income from these. Before finishing up, I wanted to make a quick comment regarding our outlook for the 2023 financial year. Allowing for the recent flood-impacted logistics disruptions, and as I mentioned, subject to our usual wet season interruptions for this time of year, Mount Gibson anticipates achieving ore sales around the lower end of the existing guidance of 3.2 million-3.7 million wet metric tons for the 2022/2023 financial year, with the balance to be promptly recouped in the following financial year.
Accordingly, unit cash operating costs are therefore expected to be around the upper end of our existing guidance of AUD 70-AUD 75 per ton FOB before royalties, and we'll provide further updates on this in due course. Given our underlying progress so far, we're strongly positive about the outlook for the business in 2023 as our mining strip ratio reduces at Koolan Island, the crushing capacity returns, and the high-grade shipping volumes increase. This is particularly so given prevailing robust iron ore prices. With that, Lisa, I'll hand back to you for any questions that anyone may have. Thank you.
Thank you so much, Peter Kerr.