Overall, FMG beat expectations, with its dividend being the highlight of the report (significantly higher than expectations, with a payout ratio of 77%). Its outlook is neutral/slightly bearish, with production numbers not expected to change much from FY20, its C1 costs to increase from US12.94/wmt to US$13-13.5/wmt, and its capital expenditure to increase from $1.97 bn to $3.0-3.4 bn.
Key Metrics:
| Tonnes shipped | 178.2m wmt shipped in FY20, a 6.26% increase on FY19. |
| Capital Expenditure | $1.97 bn |
| Cost/wmt (C1 costs) | C1 cost was US$12.94/wmt, a 1.3% decrease on FY19. |
| Total Recordable Injury Frequency Rate. | Total Recordable Injury Frequency Rate was 2.4 in FY20, a reduction of 15% on FY19. |
Outlook:
- 175-180mt Iron Ore Shipments (similar to FY20)
- C1 costs based on assumed exchange rate of AUDUSD 0.7: US$13-13.5/wmt (higher than FY20)
- Capital Expenditure: $3.0-3.4 bn
- US$1.0bn of sustaining, operational and hub development capital
- US$140mm of exploration expenditure and studies
- US$1.9-2.3bn for major projects (Eliwana, Iron Bridge and Energy)
