Would now like to hand the conference over to Mr. Marcelo Matos, Executive Director and CEO. Please go ahead.
Good morning all, and Happy New Year to all those joining, as we provide an update on our performance for the December 2024 quarter, thereby also closing our operational performance for our full-year reporting. We're pleased to have announced that overall we have exceeded the upper range of guidance with 13.8 million tons of saleable production in 2024. This outcome is reflective of the consistent performance by the business, including full-year run-of-mine production records across all three core operations and sales tons records at both South Walker Creek and Poitrel. For the December quarter specifically, despite the planned 14-day shutdown of the South Walker Creek CHPP for the tie-in of the expansion module and significant wet weather headwinds in December, we were able to consolidate the full-year results with quarterly saleable production of 3.3 million tons.
Metallurgical coal markets remained challenging throughout the quarter, with the ongoing glut of Chinese steel exports keeping demand for seaborne metallurgical coal subdued, and together with stable supply of all key regions, ultimately resulted in prices tracking largely sideways through the quarter. Despite these market conditions, the expected lower run rate of production and sales in December, and the tail end capital expenditure for our major projects in the quarter, our net debt position improved slightly to $26 million. Later in the quarter, we're also glad to report that we reached an agreement to upsize the corporate revolving credit facility by $50 million to a total of $150 million. Together with the final 2024 cash balance of $289 million and other existing credit facilities, Stanmore now has more than $500 million in available liquidity.
Finally, we continue to make strides in our decarbonization journey with an agreement with Idemitsu for a trial Pongamia plantation on our significant land holdings adjacent to South Walker Creek. Moving into further detail for the quarter and starting with safety. With no serious accidents recorded in the whole second half, we've seen the 12-month rolling frequency rate has reduced to 0.3 as of December 31st, 2024, compared to the latest industry average of 0.67. Overall, for the year, we recorded two serious accidents, both related to line-of-fire hand injuries, with most of the other recordable injuries primarily related to hand, finger, musculoskeletal, and ankle injuries. Moving on to a brief operational update at each site. South Walker Creek December quarter run-of-mine production of 1.6 million tons was down by 500,000 tons compared to the prior quarter.
This was primarily a function of wet weather impacting December, where the site received 180 mm of rain. However, it was also a function of planned mine sequence and the strong run rate through the end of September. The tie-in of the expansion module of the CHPP was completed during a planned two-week shutdown in November, which rebounded with strong productivities to support quarterly saleable productions of 1.4 million tons, only a minor decrease compared to the September quarter. Annual saleable production was 6.3 million tons, above the upper end of our stated 2024 guidance, and just 4,000 tons below the all-time saleable production record set in 2023.
Projects-wise, MRA2C reached a significant milestone with the completion of all major earthworks and rehabilitation ahead of removing the plugs to open the new creek diversion, finishing works, and the satisfaction of statutory criteria to enable development and mining of the new Y North from early in the first quarter in 2025. The project is expected to be more than $30 million below the anticipated capex, an exceptional outcome for the business and a testament to the quality of our project team in both the planning and execution of our largest capital project yet. As highlighted earlier, with the tie-in of the CHPP expansion module, the broader South Walker Creek expansion is now completed in the December quarter, with handover concluded approximately six weeks ahead of the plan.
Our major CapEx campaign started two years ago is now being successfully concluded, with the tail end of expenditure expected in the first quarter 2025, with mostly steady state sustaining capital thereafter, and we look forward to seeing the expanded operation reach new consistent heights in 2025 as we eventually see new mine capacity of 9.4 million tons of run-of-mine per annum, equivalent to approximately 7.0 million product tons going forward. Poitrel output normalized to 1.6 million run-of-mine tons in the December quarter. Strong opening inventories from an all-time production record in September quarter supported consistent saleable production and sales quarter on quarter, which also benefited from increased available wash time following the closure of Millennium previously. These results close out an impressive year for Poitrel, which set all-time run-of-mine coal production, saleable production, and sales records, ultimately exceeding guidance for 2024.
An extremely commendable effort from our site and operations teams, given the extensive work happening with the Ramp 10 boxcut, ramp-up, and numerous equipment changeouts. The Isaac Plains Complex had a challenging quarter with weather conditions in December impacting mining conditions, which, broadly speaking, necessitated prioritization of overburden removal over coal mining. Notwithstanding these challenges and a difficult start to 2024, also from wet weather, the Isaac Plains Complex set annual run-of-mine production record of 3.9 million tons for the year. Annual saleable production and sales were 2.8 million tons and 2.7 million tons, respectively, with the former sitting at the upper end of our guidance. I'll now hand over to Shane to summarize our corporate activities and key cash flow items in the quarter.
Thanks, Marcelo. As highlighted earlier in the call, we concluded the year with $289 million in cash, which, when accounting for the remaining term loan principal balance of $315 million, which is after the scheduled principal repayment of $35 million during the quarter, translates to a net debt position of $26 million as at 31 December 2024. The movement in net debt is largely neutral compared to the closing position as of 30 September 2024, reflective of the above run rate sales in the quarter prior, broadly lower coal pricing indices, and $24 million of capital expenditure, largely related to the tail end of major projects such as MRA2C and the South Walker Creek expansion, which will place us at the lower end of our guidance range for CapEx for the full year.
The $50 million upsizing of our revolving credit facility completed in December was a great outcome for the business, as it was strongly supported and ultimately filled by Australian and global banks. This additional liquidity was contemplated as part of the overall refinance concluded in September 2024 and is on the same terms and conditions as the existing facility. Overall, the upsized $150 million revolving credit facility combines with the $70 million term facility and available cash for total liquidity of $509 million as at 31 December 2024. This provides a strong base heading into a somewhat uncertain coal price environment in 2025, with a clean balance sheet following the exhaustion of significant one-off liabilities in 2024, such as the $170 million tax payment in June and $150 million earnout payment to BHP.
Finally, regarding public guidance, total consolidated saleable production has come in at 13.8 million tons for 2024, above the guidance range of 12.8-13.6 million tons. This is a great result for Stanmore, achieved despite the closure of Millennium Complex and wet weather challenges, and demonstrates our operating capability as well as the strength of our de-risked portfolio. We look forward to updating our investors on our cost and capital expenditure performance versus guidance come the release of our financial results in late February. I'll now hand back to Marcelo to conclude the call with a brief overview of market conditions before moving to Q&A.
Thanks, Shane. As stated in the report, met coal indices traded broadly sideways in the December quarter, remaining in a holding pattern at around $200 per ton. We're watching closely how buyers adapt to any shift in global policy direction, particularly with retaliatory measures that may come out of China from potential US tariffs and the pace of returning demand from India, including announcements of government spending on infrastructure and met coal import quotas. For the time being, the theme of China steel exports remaining elevated continued through the December quarter, reaching a peak annual run rate in October with just over 11.2 million tons for the month. This puts total Chinese exports of steel at over 110 million tons for 2024, which is the highest level recorded since 2015 and well above the average over the last decade.
With that, I'll now hand over to the moderator so we can take your questions.
Thank you. If you wish to ask a question, please press star one on your telephone and wait for your name to be announced. If you wish to cancel your request, please press star two. If you're on a speakerphone, please pick up the handset to ask your question. Your first question today comes from Brett McKay with Petra Capital. Please go ahead.
Thank you and good morning, team. Another excellent result. Well done. Just a quick one around, I suppose, the outlook for operations going into 2025, to the extent that you can speak to it, just focusing on the strip ratio, probably a bit higher in the December quarter than what I'd anticipated, but I guess there's weather impacts in that as well. Just given where it's at now, can you give us a bit of a guide as to where that might trend into FY 2025 for the year? Are we expecting it to sort of stay up at these levels or trend back slightly with normalization post the wet season?
Morning, Brett. Look, I think its strip ratio was an anticipated question. I think South Walker is probably the standout in the quarter. As we said, we were around 500,000 tons below where we wanted to be. There was a bit of prioritizing stripping given the impact we had on wet weather. We did finish the year with healthy ROM stocks, okay, despite all the weather. We had more than 1 million tons of ROM across the board in all the three operations with notably healthy in-pit inventories as well. So yes, Q4 was an outlier, I would say, and probably South Walker being the key one with 14- 1. It's not what we expect going forward. If you look at the average for the year in South Walker, we were close to 10.
It was a year that this higher stripping in South Walker was expected given the ramp-up of the expansion fleets, right? We have additional fleets to ramp up the ROM production, so this was expected. We had some good outcomes on yield as well, okay? So we were mining more coal on the southern pits, which somehow upset the strip ratio a little bit with better yields. So going forward, we are now opening the Y North, which is the first one at the MRA2C area, and we expect a much more, let's say, steady state, lower strip ratio going forward in South Walker, for sure. At Poitrel, for the year, we had an average of 8-1, as you see, 8.1. So that's probably a steady state level at Poitrel, plus minus, I would say, plus minus with some variation.
With Isaac having averaged 11.7 in December, that was perhaps above what we were expecting as well for similar reasons for South Walker. The average was 9. There is an expectation of this to be slightly up in 2025, which is not unexpected as well. So, I mean, long answer to your question, Brett, but no, I think Q4 is not a normal quarter. We already expect Q1 2025 to be quite different and the 2025 as a whole as well, especially South Walker Creek.
Okay, thanks, Marcelo. Just following that, any impacts as you open up those new pits at South Walker on the strip ratio, or is that sort of going to be some capitalized waste upfront?
There will be some capitalized waste upfront in the Y North, which is the only one we're going to mine this year in South Walker Creek. That's going to be part of the CapEx guidance. It was always part of our estimates for the project. But strip ratio-wise, it will be a pretty low strip ratio pit going forward, especially, of course, in the early months or years in the MRA area.
Okay, great. Thank you. Just quickly moving on to studies around sort of growth projects and optionality you have in the portfolio. Can you just give us a quick update around timing of the various projects that you've got ongoing and studies that we might expect to see during the course of this coming year, particularly around Eagle Downs and noting your Lancewood comment that you've paused that study?
Maybe I'll start with the Isaac Downs Extension, okay, which is maybe for information is how we are renaming the Isaac South project. We are now calling it Isaac Downs Extension. That's going at full throttle. Okay, we are now finalizing mining plans, which will be the basis for the regulatory approval submissions, which is, of course, critical path and is quite important. So priority is to make sure that we land on a base case for the submissions, especially if we look around disturbance and all the ecology works and, let's say, groundwater works that we need to do ahead of the submissions. Our aim is to be finalizing and lodging EIS somewhere early next year.
That put us on track to, hopefully, all going well, obtain the regulatory approvals by the end of 2027, given it's an extension project and we are considering it a brownfield extension of the Isaac Downs project. We are hoping that by 2028, we should be able to start development. It's a similar project to Isaac Downs, as we've spoken in the past, with basically a whole road, a bridge over the Isaac River, and basically opening the pit and mining infrastructure. So it's a simple project. And all going well, we hope to be able to minimize, let's say, disruption between the end of Isaac Downs or the economic limits of Isaac Downs and the ramp-up of the extension project. It will be hard to keep tons at current levels at Isaac given the high cost and high strip ratio going forward. That was always expected.
Okay, but of course, the priority will be to work hard to be able to bring the extension project as quick as possible with the regulatory approvals being the critical path. Eagle Downs work is progressing. We don't have, as we spoke many times in the past, we don't have any, let's say, urgency in taking an investment decision anytime in the short term. We always frame Eagle Downs as being a great option to have as a growth project, but also as a long-term replacement for Poitrel. Poitrel only runs out in the early 2030s. So if that is the main, let's say, strategy for the project, we have time.
However, if the project proves to be attractive, and of course, that will be a result of the work that we are doing now on proving up the CapEx requirements, and of course, to look at what we can expect from the performance of the project going forward in tons and costs. And if we have the right funding equation for the project, it could be brought forward. Okay? At this stage, we are doing the work required to be able to understand the costing of the project from a CapEx standpoint within this year to be able to make an investment decision if all the stars align, meaning we have the right market conditions and we have the right funding solution for the project. But as I said, there is no, let's say, drop-dead date or urgency in making any investment decision for Eagle Downs in the short term.
All right. Excellent. And just quickly on Lancewood, that sounds like it's been sort of you've determined some key parameters there and decided to park that study up for the time being.
Yes, Lancewood is more on a slower burn, let's put it like that. We have priorities, and the priorities are on Isaac, on the Isaac Extension and to a certain extent Eagle Downs, given Eagle Downs have all the approvals in place. Lancewood, we'll need to get the, I mean, although it has a mining lease, we'll need to get the regulatory approvals. Work towards getting the regulatory approvals will not stop necessarily, okay, because, of course, that's a critical path. Having said that, the existing mining lease for Lancewood is only expiring in 2030. So there is time for us to be able to obtain approvals and satisfy those requirements to make sure that we still have the mining lease in place by the time we need to make an investment decision.
But as I said, Isaac Extension and the Isaac Downs Extension and Eagle Downs, they are taking priority in that list.
All right. Makes sense. I'll leave it there, James. Thanks for that.
A question comes from Glyn Lawcock with Barrenjoey. Please go ahead.
Oh, morning, Marcelo and team. Just I know you're going to give guidance next month, but is there anything you want to call out that we should be aware of in 2025 scheduled maintenance shutdowns again that are going to come up in this year? And when you come to Isaac Plains, you talked about a tough January as well. Does that feel like you're going to probably have to play a bit of catch-up with that mine in the subsequent quarters, post-March quarter?
Morning, Glynn. Look, maybe to start, the key message around projects and capital is by second quarter, we are back to steady state, sustaining capital, I mean, within the three operations with, let's say, with the capital program completed. That means all going well with South Walker, and so far it's actually going very well on the ramp-up of the CHPP. We'll be at a steady state, 7 million run rate at South Walker. Poitrel, interestingly, we'll have another strong year. Okay, of course, we are only giving guidance in another few weeks or so, but it will be another strong year for Poitrel and for Isaac. What I can anticipate is we expect 2025 to be a strong year production-wise. January, yes, was a tough month. We were hit with weather not only in Isaac, but across the board.
We actually, similar to 2024 into 2023 as well, January was not a good month to start the year. Sales and production were below expected, but similar to what we've done in 2023 and 2024, I can't see anything preventing us to catch up, okay, and to be producing at the levels we expect for the year. As a whole, Glynn, I think there will be the ups and downs between the three ops. As a whole, interestingly, given one may upset the other given the timing and coal flow, we're expecting a much more even year this year in terms of consolidated total coal production compared to perhaps the last couple of years. I think we're going to have a more balanced quarter-to-quarter production. Of course, some ups and downs among the operations.
All right. That's great. And then maybe just turning to cash movements. You called out a couple of items, but just working capital, was there a working capital build as a result of ROM and saleable production flip in the final quarter just resulting in you being net debt at year-end?
Yeah, hi, Glynn. Yeah, I'd say probably one of the things as I called out earlier about sort of the cash movements was that looking at particularly Q3 was kind of a strong quarter for sales. And with some of the wet weather and other production being a little lower at South Walker, we did see that impacting on Q4. So to a certain extent, that's had an impact then falling into some working capital items, which has contributed, as you say, to the movement in cash. As we get into the early parts of 2025, that should start to normalize. But it's all dependent on weather as usual and coal prices and NFX, which is actually working in our favor as we sit here today.
No, thanks. Then just final question. Just on your level of liquidity, as you said, just over $500 million today, given the nature of the business and coal prices can be volatile, I mean, is that an appropriate level or is that on the excessive side? How do you think about $500 million in liquidity now? Is that appropriate?
Yeah. Look, interestingly, that's sort of the level that we had shortly after the BMC acquisition. We had a couple of facilities there, which when totaled up, along with cash reserves at that time, was pushing that AUD 500 million mark. It may be a little bit on the conservative side for a business of our size, but I guess that's a little bit of the function of where we find the coal market looking forward into 2025 as well. So yeah, it's better to have a little bit extra than a little bit less, but it's something that we're monitoring and no doubt the board will consider too when meeting in their annual board meeting in February.
Yep. When they come to think about the dividends and returns. Yep.
Yep, that's right.
All right. Thanks very much.
Once again, if you wish to ask a question, please press star one on your telephone. We'll now pause a short moment to allow questions to be registered. There are no further questions at this time. I'll now hand back to Mr. Marcelo Matos for closing remarks.
Thank you all for your questions and for joining today's call. As always, I would like to thank our employees and contractors. We could not have closed out a strong 2024 without your dedication and commitment to Stanmore. We look forward to continuing to engage with our shareholders when we release our annual financial results for 2024 in February, and good morning, everyone.
That does conclude our conference for today. Thank you for participating. You may now disconnect.