Annual Report
2022
whitehavencoal.com.au
Contents
About us
Our strategy
Chairman’s introduction
Managing Director and CEO’s introduction
Directors’ Report
Operating and financial review
Remuneration Report
Financial Report
ASX additional information
Resources and Reserves
Glossary
Corporate directory
1
2
4
5
6
15
27
53
107
110
112
113
This report includes forward-looking statements relating to future events and expectations.
While these statements reflect expectations at the date of this publication they are by their nature not certain and are subject to known and unknown risks.
Whitehaven makes no representation, assurance or guidance as to the accuracy or likelihood of fulfilling any such forward-looking statements (whether express
or implied) and, except as required by applicable regulations or law, Whitehaven does not undertake to publicly update such forward-looking statements.
About us
Whitehaven Coal is Australia’s leading producer of high-quality, high-CV
thermal coal. Our thermal and metallurgical coal products are exported to
premium markets in Asia. Our operations are located in the Gunnedah Basin
in New South Wales with growth projects in both the Gunnedah Basin and
Bowen Basin in Queensland.
As an active coal producer for more than 20 years including 15 years as a publicly-listed entity on the Australian
Securities Exchange (ASX), Whitehaven is known for quality, excellence in safety and project delivery, and
contributing to regional economies through investment and engagement.
Our three largest customer
countries are powered by
Whitehaven Coal for between
approximately 23 and 33 minutes
each day:
Japan
33.0 minutes of power/day
Korea
22.9 minutes of power/day
Taiwan
27.1 minutes of power/day
Whitehaven’s sales
50%
14%
13%
10%
7%
5%
1%
Japan
Korea
Taiwan
India
Other1
Indonesia
Europe
South
Korea
Japan
India
Taiwan
Vietnam
Malaysia
Indonesia
Of our,
~2,500 workforce2
approximately 75%, are based
in the regional areas where
our assets are located
Our operating assets are
complemented by two high-quality,
near-term development projects:
Winchester South Project (QLD)
Vickery Extension Project (NSW)
Australia
Our four operations are all located
in the Gunnedah Basin
Narrabri Mine
Maules Creek Mine
Tarrawonga Mine
Werris Creek Mine
All Whitehaven coal is exported
out of the Port of Newcastle.
1 Other coal sales destinations include Malaysia, New Caledonia, Vietnam and Thailand.
2
Our workfroce includes 1,227 FTE employees and 1,229 FTE contractors
Page 1 | Whitehaven Coal Annual Report 2022
Our strategy
Our strategy is to own and sustainably operate large, cost-efficient mines
producing high-quality, high-CV thermal coal for premium markets in Asia
and coking coal for metallurgical customers in the region.
We supply coal products to provide energy security for our customers. At the same time, we are helping our
customers to responsibly meet their decarbonisation goals because our high-quality, high-CV coal offers more
energy efficient and lower emissions outcomes than other coal products.
As the world transitions to higher-CV and higher quality thermal coal, we are focused on increasing our share of the
growing market for high-quality coal products in the region, including metallurgical coal.
Our long-life mining assets will supply our customers in Asia and support our local communities in Australia for
decades to come.
FY22 in review
Exceptionally strong demand
Safe, sustainable and efficient operations
– Long-term under-investment in coal supply
– Employee and contractor TRIFR3 of 5.4, an 8%
underpinned strong demand for high-CV coal
improvement on the prior year
– The global supply shortfall intensified following
– Solid operational performance despite labour
Russia’s conflict in Ukraine
– Coal prices reached record levels, with a record
average realised coal price of A$325/t for FY22
compared with A$95/t in FY21
– Equity coal sales of 14.2M tonnes
– 82% of sales to thermal customers, 18% to
metallurgical customers
Thermal coal prices (US$/t)1
Forecasts2
$500
$400
$300
$200
$100
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High-CV coal price
based on gC NEWC
Index
Lower-CV
coal price
based on API
5 Index
Low-CV coal
price based on
M38 Index
Indonesian coal
constraints, COVID absenteeism, weather events and
inflationary pressures
– Run-of-mine (ROM) managed production of
20.0M tonnes, within guidance range
– ~1.0m tonnes scope 1 and 2 CO2-e emissions4,
~9% higher than FY21 primarily due to increased
production at Narrabri, but lower than 1.6m tonnes
reported for FY20 due to use of site-specific
emissions factor for Maules Creek
– Whitehaven’s high-CV thermal coal delivers lower
emissions intensity than other coals, helping our
customers decarbonise; we are fueling plants in
Japan that emit ~44% less CO2-e than coal fired
power plants in Victoria, for example
CO2 emissions per MWh of sent out energy generation
by coal fired power plants5
44% lower emissions
24% lower emissions
0.95
0.89
0.81
0.72
0.65
h
W
M
/
2
O
C
t
1.29
S u b critical
L o y Y a n g A ( Vic)
Lig nite at
S u b critical
Black C o al at
B a ys w ater ( N S W )
S u b critical
Black C o al at
M il m erra n ( Qld)
U S C
Black C o al at
Lin k o u (T aiw a n)
U S C
Black C o al at Iso g o
U nit # 2 (Ja p a n)
A -U S C
Black C o al
Whitehaven’s coal currently allows Ultrasupercritical (USC) power plants
in Asia to deliver lower emissions than coal fired power plants in Australia
Page 2 | Whitehaven Coal Annual Report 2022
Our STRIVE Values unite us, direct our decision making and guide our interactions.
Safety
The safety of
our people,
workplaces and
the communities
around us
comes first. We
are committed
to Zero Harm.
Teamwork
We work
collaboratively
and support one
another.
Respect
We foster a
diverse and
inclusive culture
and deal with
all stakeholders
respectfully.
Integrity
We are honest
and do the right
thing.
Value
We create
value for
shareholders,
customers
and local
communities.
Excellence
We deliver
on our
commitments.
Record financial results
– Record NPAT of $2.0 billion compared with a
statutory loss of $544 million in FY21
Disciplined capital management and
exceptional shareholder returns
– Balance sheet strength with senior bank debt fully
– Record EBITDA of $3.1 billion, a significant increase
repaid and $1.2b of cash at 30 June 2022
on $204.5 million in the prior year
– 40 cent fully franked final dividend and 8 cent
– Cash from operations of $2.6 billion compared with
interim dividend
$169.5 million in FY21
Contributing to our communities
– $1.0 billion of taxes and royalties paid or payable
for FY22
– $1.53 million in corporate community partnerships
and donations6
– $362.6 million to buy back shares
– 154% total shareholder returns ranked #1 in the
ASX100
Capital allocation framework
– $354.5 million spent with local suppliers
Operating cash flows
– $8.73 million spent with 14 Aboriginal and Torres
1
2
Strait Islander businesses
Attracting and retaining talent
– 3% increase in employee engagement scores to
6.3 out of 10
– 15.3% female participation in our workforce up from
12% in FY21
– 11.8% of workforce identify as Aboriginal and/or
Torres Strait Islander
– Introduction of retention bonuses for operations
employees
– Executive remuneration framework reviewed
Maintain & optimise
operations
Retain cash / maintain
balance sheet strength
4
Use surplus capital for best use
3
Return to shareholders
Dividends Buy-backs
Growth investments –
M&A
Growth investments –
Development projects
Additional returns
to shareholders
Targeting ~20%-50% NPAT payout ratio for distributions
dividends and buy-backs combined. We may exceed 50%
if the best use of surplus capital is to increase distributions
(dividends and/or buy-backs).
1 Average monthly price.
2
Forecast prices based on globalCOAL forward curve at 6 September (gC NEWC), weekly McCloskey Fax Report at 2 September (API 5), McCloskey Thermal
Coal Price History and Outlook at 9 August (Indo 3400 NAR).
3 Total recordable injury frequency rate.
4 FY22 data is subject to external assurance review. Final FY22 greenhouse gas emission data will be available on Whitehaven’s website from November 2022.
5 Loy Yang and Bayswater data from AGL’s FY21 Full Year Results. Milmerran data based on NGER data. Linkou, Isogo and A-USC data based on Company data.
6
Includes $500,000 of emergency response donations to support Ukraine and NSW flood appeals, and $400,500 in “Why Leave Home” COVID relief vouchers
to support local communities and employees.
Page 3 | Whitehaven Coal Annual Report 2022
Chairman’s
introduction
highest quality coals are available to do this. The energy
transition will be energy intensive, and coal-powered
electricity will be required to build the necessary
technologies and infrastructure.
Carbon capture usage and storage (CCUS) technologies
will help ensure emissions reductions targets can be met
while economies and populations continue to expand.
Global investment in CCUS research and development
is growing rapidly and momentum is building around the
coal-industry funded and government-supported work
of Low Emissions Technology Australia (LETA).
Whitehaven plays an important role in supporting
industry innovation, community development, and
economic growth more broadly. Our taxes and royalties
to governments both State and Federal, total a record
$1 billion in relation to FY22, contributing to Australia’s
economic prosperity.
Looking ahead, high-quality, high-CV thermal coal is set
to remain in strong demand, with prices expected to be
well supported. In terms of metallurgical coal, despite
current volatility, longer-term the demand outlook and
price environment remain positive. We have a number
of growth options, as outlined in our FY22 results, to
meet the strong continued demand.
Overall, the outlook for Whitehaven is very positive.
We are attracting and retaining good people to work
at Whitehaven. We have an engaged workforce, strong
leadership, and a developing cohort of emerging
leaders. As detailed in our Remuneration Report, in
FY22 we undertook a comprehensive review of our
executive remuneration framework, with retention of
executive talent an important objective.
I thank all Whitehaven’s people, particularly Paul Flynn
and the executive leadership team, for the outstanding
financial results in FY22 and improvements across all
areas, including safety. It is encouraging to see a further
reduction in total recordable injury frequency rate
(TRIFR) to 5.4 in FY22, and that Whitehaven’s five-year
average TRIFR of 5.8 is well below the NSW five-year
Industry average of 12.9.
I also thank our shareholders for their continued
support. I am pleased that you are now being rewarded
for your patience, with 51% of FY22 NPAT returned
through dividends and share buy-backs. We intend
to continue to return capital to shareholders through
franked dividends and buy-back programs.
We look forward to the year ahead and being
the number one choice for our customers.
Dear shareholders,
Whitehaven reported record earnings
for FY22 as demand for our products
exceeded supply and coal prices
increased to new highs.
This past year highlighted that access to high-quality,
high-CV coal for reliable energy supply is essential.
The products we sell into a global market cannot
be easily substituted, a fact reflected in the prices
being achieved.
While sanctions against Russian coal and gas as a result
of its invasion of Ukraine have exacerbated global
energy shortages, this predicament is also a function
of significant underinvestment in reliable supply over
many years.
Decarbonisation is necessary but it must take place
in a responsible and coordinated way. As the world
re-prioritises energy security, we are committed to
maintaining supply and reliability for our customers,
while supporting them to meet their emissions
reduction aspirations.
We produce the highest quality thermal coal in the
seaborne market. Our thermal coal fuels high-efficiency,
low-emissions (HELE) electricity generation that is
helping our customers in Asia generate electricity
with emissions much lower than older coal-fired
power plants.
Towards the end of the financial year CEO Paul
Flynn and I met with our largest customers in Japan,
where more than 3,000 MW of new HELE electricity
generation is planned to replace older coal-fired power
plants. Our customers demand the highest quality coal
to supply this new capacity and to help them meet
Japan’s decarbonisation goals in line with the Paris
Agreement, and we are proud to play a role in this.
As the world transitions to more intermittent renewable
energy sources, traditional energy sources like coal
are critical to provide a reliable baseload of energy,
and it’s important that the most energy efficient and
The Hon. Mark Vaile, AO
Chairman
Page 4 | Whitehaven Coal Annual Report 2022
Managing Director
and CEO’s introduction
Our 2022 Sustainability Report provides further details
of our safety outcomes and management approach
as well as reporting on environmental management,
climate-related risks, managing our people, and
community engagement and support. We are
delivering year-on-year improvements in all of these
areas including improved environmental compliance,
progress against our diversity targets and progress
in terms of better understanding and managing
climate-related risks and opportunities.
In FY23, we expect to deliver another strong year.
We expect to produce around 20-22 million tonnes
of run-of-mine (ROM) production and manage
17.5-18.5 million tonnes of coal sales.
Our unit cost of production is increasing as a result of
higher diesel, electricity, labour and other inputs, but we
are well placed to continue to deliver strong margins as
a result of the ongoing strong pricing environment.
In FY23, we are reinvesting between $287 million and
$360 million of capital into the business, which is an
uplift on FY21 capital expenditure of $189 million.
The increased expenditure includes some one-off
expenditure in relation to developing the southern
section of the Narrabri underground mine.
We are pleased that the Narrabri extension project
has now received state-based approvals, allowing the
mine life to be extended to 2044. In addition, the NSW
Government has granted approvals for two exploration
licenses contiguous with the existing operation at
Narrabri that will allow us to explore land to the
north-west of the existing mine.
Our Vickery development project in NSW has received
all its primary approvals. We are now refining mine
plans and capital plans. For our Winchester South
metallurgical development project in Queensland, we
are completing State and Federal Government approval
processes and undertaking further geotechnical and
other detailed studies. We are progressing these
development projects to be ‘shovel ready’ so that
investment decisions can be made when appropriate
hurdles are met.
As we look forward to the year ahead, I thank all
of Whitehaven’s people and our Board of Directors
for their contribution and support in FY22. I thank
our customers, suppliers, joint venture partners and
shareholders for their continued support, as well as our
local communities and Traditional Owner groups who
continue to be valued partners on our journey.
Paul Flynn
Managing Director and CEO
Dear shareholders,
FY22 was an incredible year.
As the global energy supply shortfall
intensified, coal prices reached
record levels and customers focused
on energy security as a priority.
At Whitehaven, we are well-placed to supply customers
and we achieved a record realised average price of
A$325 per tonne in FY22, compared with $95 per tonne
in the prior year.
Despite continued COVID-related absenteeism,
labour constraints and weather interruptions, our
team delivered solid operational and product quality
improvements, and we maximised sales of high-CV,
high quality thermal coal where demand was strong
and price appreciation was greatest.
Whitehaven delivered a record net profit after tax
(NPAT) of $2.0 billion, and earnings before interest, tax,
depreciation and amortisation (EBITDA) of $3.1 billion.
The strong cash generation, which is continuing in FY23,
provides balance sheet strength and stability and will
support continued returns to shareholders.
We are returning 51% of FY22 NPAT to shareholders
through a 40 cent fully franked final dividend, the
8 cent interim dividend, and a 10% share buy-back
program, which commenced in March 2022 and is
expected to be completed around the end of October.
At the Annual General Meeting we will seek shareholder
approval to buy back additional shares, which continues
to represent excellent value and an effective way to
return capital to shareholders.
Whitehaven finished FY22 with a #1 ranking on the
ASX100 for total shareholder returns (TSR), with a
TSR of 154%.
Our safety performance also improved in FY22.
We reported a recordable injury frequency rate of 5.4,
which was 8% better than last year, and 22% better
than where we were five years ago.
Page 5 | Whitehaven Coal Annual Report 2022
Directors’ Report
For the year ended 30 June 2022
Directors’ Report
For the year ended 30 June 2022
Page 6 | Whitehaven Coal Annual Report 2022
Directors’ Report
For the year ended 30 June 2022
The Directors present their report together with the consolidated financial report of
Whitehaven Coal Limited (‘the Company’ or ‘Whitehaven’), being the Company, its
subsidiaries and the Group’s interest in joint operations for the year ended 30 June
2022 and the auditor’s report thereon.
1. Principal activities
The principal activity of Whitehaven Coal Limited and its controlled entities (the ‘Group’) during the period was the
development and operation of coal mines in New South Wales and Queensland.
In the opinion of the Directors, there were no significant changes in the state of affairs of the Group that occurred during
the financial year that have not been noted in the review of operations.
2. Directors and Executives
2 (a) Directors
The Directors of the Company at any time during or since the end of the financial year are:
The Hon. Mark Vaile AO
Chairman
Non-Executive Director
Appointed: 3 May 2012
As Deputy Prime Minister of Australia and Leader of the National
Party from 2005 to 2007, Mark established an extensive network of
contacts throughout Australia and East Asia. His focus at home was
with regional Australia and particularly northern NSW. As one of
Australia's longest serving Trade Ministers from 1999 until 2006, Mark
led negotiations which resulted in Free Trade Agreements being
concluded with the United States of America, Singapore and
Thailand, as well as launching negotiations with China, Japan and
ASEAN.
Importantly, early in his ministerial career as the Minister for
Transport and Regional Services, Mark was instrumental in the
establishment of the ARTC, which operates the Hunter Valley rail
network.
Mark brings significant experience as a Company Director having
been Chairman of Aston Resources, CBD Energy Limited and
SmartTrans Limited, a former independent Director on the board of
Virgin Australia Holdings Limited and former Director Trustee of
HostPlus Superfund. Mark is currently a Director of ServCorp Limited,
which is listed on the ASX (since June 2011), Stamford Land Corp,
which is listed on the Singapore Stock Exchange, and Chairman of
Palisade Regional Infrastructure Fund.
Former ASX-listed directorships in the last three years:
Nil
Page 7 | Whitehaven Coal Annual Report 2022
Directors’ Report
For the year ended 30 June 2022
John Conde AO
BSc, BE (Electrical)
(Hons), MBA (Dist)
Deputy Chairman
Non-Executive Director
Appointed: 3 May 2007
Dr Julie Beeby
BSc (Hons I), PhD
(Physical Chemistry),
MBA, FAICD, FTSE
Non-Executive Director
Appointed: 17 July 2015
Paul Flynn
BComm, FCA
Managing Director
Appointed:
25 March 2013
Previously Non-Executive
Director
Appointed: 3 May 2012
John has over 30 years of broad based commercial experience
across a number of industries, including the energy sector, and was
Chairman of the company prior to the merger with Aston Resources.
John is Chairman of Cooper Energy Limited (since February 2013),
the Dexus Wholesale Property Fund and the McGrath Foundation, as
well as President of the Commonwealth Remuneration Tribunal. He
was Chairman of Bupa Australia and New Zealand, the Sydney
Symphony Orchestra, Ausgrid (formerly Energy Australia) and
Destination NSW. He was also formerly Chairman and Managing
Director of Broadcast Investment Holdings, as well as a Non-
Executive Director of BHP Billiton Limited, Excel Coal Limited and
Dexus Property Group.
Former ASX-listed directorships in the last three years: Director,
Dexus Property Group (April 2009 – September 2020)
Julie has more than 25 years’ experience in the minerals and
petroleum industries in Australia, including major Australian and US
resources companies, and as Chief Executive Officer of the ASX-
listed coal seam gas producer WestSide Corporation Ltd. Julie has
technical, operations and strategy expertise and has held senior and
executive positions in coal mining, mining services and coal seam
gas, after commencing her career in coal and mineral processing
research. Julie was formerly the Chairman of the Queensland
Electricity Transmission Corporation Limited, and Non-Executive
Director of Gloucester Coal Limited, OzMinerals Limited, CRC Mining,
Queensland Resources Council and Australian Coal Research.
Currently, Julie is a Non-Executive director of Tasmanian Networks
Pty Limited.
Former ASX-listed directorships in the last three years: Nil
Paul has extensive experience in the mining, infrastructure,
construction and energy sectors gained through 20 years as a
professional advisor at Ernst & Young. Paul was formerly Chief
Executive Officer and Managing Director of the Tinkler Group and
was instrumental in the merger of Whitehaven Coal with Aston
Resources. Paul joined the Board of Whitehaven on 3 May 2012 and
assumed the role of Managing Director and CEO on 27 March 2013.
Prior to joining the Tinkler Group, Paul was the managing partner of
Ernst & Young’s Sydney office and a member of its Oceania
executive team. As a partner for over eight years, Paul managed
many of the firm’s largest mining and energy clients across Australia,
Asia, South and North America. Paul has also fulfilled various
leadership roles with large corporations on secondment, including as
the CFO of a top 50 listed company.
Former ASX-listed directorships in the last three years: Nil
Page 8 | Whitehaven Coal Annual Report 2022
Directors’ Report
For the year ended 30 June 2022
Fiona Robertson
MA (Oxon), FAICD,
MAusIMM
Non-Executive Director
Appointed:
16 February 2018
Lindsay Ward
BAppSc (Hons I),
GradDip (Mgt), FAICD
Non-Executive Director
Appointed :
15 February 2019
Raymond Zage
BSc Finance
Non-Executive Director
Appointed:
27 August 2013
Fiona has a corporate finance background, with more than 20 years’
experience as CFO of ASX-listed emerging and mid-tier mining and
oil and gas companies, preceded by 14 years with Chase Manhattan
Bank in London, New York and Sydney in corporate banking, credit
risk management and mining finance roles. Previous Non-Executive
Directorships include ASX-listed oil and gas producer, Drillsearch
Energy Limited, where she chaired the Audit & Risk Committee and
Heron Resources Limited. Currently Fiona is a Non-Executive
Director of Bellevue Gold Limited (since May 2020) and 29Metals
Limited (since May 2021).
Former ASX-listed directorships in the last three years:
Heron Resources Limited (April 2015 – July 2020)
Lindsay has more than 35 years’ experience across industries
including mining, exploration, mineral processing, ports management,
rail haulage, power generation, gas transmission, renewables and
logistics. He is currently President of Iris Energy, a sustainable Bitcoin
miner. Prior to this, he was CEO of Palisade Integrated Management
Services, which had nine diverse infrastructure assets under
management including 750MW of renewable energy. Lindsay also
has extensive senior operational experience in ports, rail and coal
fired power generation.
Lindsay started his career in the mining industry having worked with
BHP Australia Coal (Bowen Basin – Queensland), Camberwell Coal
(Hunter Valley – NSW) and Yallourn Energy (Latrobe Valley –
Victoria), as well as Western Mining and Westralian Sands, in
various mine engineering and senior leadership roles including
Mine Manager and General Manager.
Lindsay is a Fellow of the Australian Institute of Company Directors
and is an experienced Director of both listed and unlisted companies.
Former ASX-listed directorships in the last three years:
Nil
Raymond is the founder and CEO of Tiga Investments Pte Ltd. He is
also senior advisor to Farallon Capital Management, L.L.C., one of the
largest alternative asset managers in the world, an independent Non-
Executive Director of Toshiba Corporation (listed on the Tokyo Stock
Exchange), a Non-Executive Director of PT Lippo Karawaci Tbk
(listed on the Indonesian Stock Exchange), and on the Board of
Commissioners of Indonesian company Gojek. Raymond has been
involved in investments throughout Asia in various industries,
including financial services, infrastructure, manufacturing, energy and
real estate. Previously, Raymond was the Managing Director and CEO
of Farallon Capital Asia, and prior to that he worked in the
investment banking division of Goldman, Sachs & Co. in Singapore,
New York and Los Angeles.
Former ASX-listed directorships in the last three years: Nil
Page 9 | Whitehaven Coal Annual Report 2022
Directors’ Report
For the year ended 30 June 2022
2 (b) Senior Executives
Paul Flynn —
Managing Director and Chief
Executive Officer
Kevin Ball —
Chief Financial Officer
BComm, CA
Refer to details set out in section
2(a) Directors on page 8.
Appointed Chief Financial Officer of
Whitehaven Coal in October 2013,
Kevin Ball has over 25 years’
experience working in the mineral
and energy industry across coal, oil
and gas, and in complex consulting
practices.
A finance graduate of the University
of New South Wales, Kevin is a
Chartered Accountant, having spent
11 years with Ernst & Young at the
commencement of his career,
predominantly in EY’s natural
resources group. Kevin has a
graduate Diploma in Geoscience
(Mineral Economics) from Macquarie
University.
Timothy Burt —
General Counsel and
Company Secretary
B.Ec, LLB (Hons) LLM
Timothy joined Whitehaven as
General Counsel and Company
Secretary in July 2009. He has more
than 20 years’ experience in legal,
secretarial and governance roles
across a range of industries for ASX-
listed companies. Prior to joining
Whitehaven, Timothy held senior
roles at the ASX-listed companies
Boral Limited, UGL Limited and
Australian National Industries
Limited. He holds a Master of Laws
from the University of Sydney.
Page 10 | Whitehaven Coal Annual Report 2022
Directors’ Report
For the year ended 30 June 2022
Daniel Cram —
Executive General Manager –
People and Culture
BComm, MIR
Ian Humphris —
Executive General Manager –
Operations
BE Mining (Hons)
Daniel joined Whitehaven in March
2021 and was appointed Executive
General Manager – People and
Culture in June 2021. Daniel has 25
years’ experience as a HR
professional, including more than a
decade leading large resourcing,
remuneration, workplace relations
and organisational culture functions
for a range of publicly-listed
companies. Most recently, Daniel ran
his own consultancy firm,
specialising in human resources,
employee relations and
remuneration strategy, mergers and
acquisitions and change
management. Prior to this, Daniel
spent over a decade in senior human
resources roles at AGL Energy
covering the industrial aspects of
that business, including its power
generation assets and coal mining
operations.
Appointed Executive General
Manager – Operations in April 2020,
Ian is a mining engineer with more
than 20 years’ experience in the
Australian resources sector, with a
diverse and deep background across
open cut and underground
operations. Ian was most recently
Vice President – Health, Safety and
Environment at Peabody Energy
Australia. Prior to this, he fulfilled a
broad range of senior roles covering
many aspects of Peabody Energy’s
business, including managing the
company’s open cut operations,
supply chain and infrastructure
assets. Ian began his career in
resources as a mining engineer in
various Queensland mines before
transferring to the New South Wales
coalfields and working in senior roles
for a number of mine owners and for
the mining services provider, Thiess.
Michael van Maanen —
Executive General Manager –
Corporate, Government and
Community Affairs
BA (Hons)
Michael has nearly 20 years’
experience across corporate
communications and public policy
roles in both the government and
private sectors. He was appointed
Executive General Manager –
Corporate, Government and
Community Affairs in May 2018. Prior
to joining Whitehaven, Michael was a
founding partner of Newgate
Communications and led the firm’s
mining and resources practice
group. Michael was previously a
ministerial advisor in the Howard
Government and worked in a range
of national security policy roles for
the departments of the Prime
Minister and Cabinet, Foreign Affairs
and Trade and Defence.
Page 11 | Whitehaven Coal Annual Report 2022
Directors’ Report
For the year ended 30 June 2022
Jason Nunn —
Executive General Manager –
Marketing and Logistics
BEng (Hons), MEMB
Mark Stevens —
Executive General Manager –
Project Delivery
BSc (Hons), MSc, MBA
Sarah Withell —
Executive General Manager –
Health, Safety and Environment
BSc, MEngSc
Mark joined Whitehaven as
Jason was appointed Executive
Executive General Manager – Project
General Manager – Marketing and
Delivery in January 2020. Mark has
Logistics in December 2020. Before
more than 30 years of Australian
joining the marketing team at
and international experience in
Whitehaven Coal in 2014, Jason held
project management and delivery
a range of roles in the resources
across infrastructure, coal, and oil
sector, primarily in the coal industry,
and gas. A qualified mining engineer,
across research, production and
Mark has successfully delivered
commercial functions at Yancoal,
projects across all phases, from
White Energy and BHP Billiton in
concept to completion, with a
Australia and the Netherlands. Jason
combined capital cost in the billions,
holds a Bachelor of Engineering
most recently for the Australian Rail
(Chemical) and Master of
Track Corporation’s Inland Rail
Environmental Management and
project and prior to that, for Santos
Business from the University of
GLNG.
Newcastle.
Sarah joined Whitehaven as
Executive General Manager – Health,
Safety and Environment in July
2020. Sarah has more than 20 years’
experience in the mining and
resources sector with a proven track
record of delivering major mining
approvals, effective safety and
governance systems, and excellent
HSEC performance. Sarah has held
senior positions across open cut and
underground operations in both
NSW and Queensland. Most recently,
Sarah led the HSE function for BHP’s
NSW Energy Coal and BMC division,
and has also held roles at Coal &
Allied and Peabody.
Page 12 | Whitehaven Coal Annual Report 2022
Directors’ Report
For the year ended 30 June 2022
2 (c) Directors’ interests
The following table lists each Director’s relevant Company-issued shares and options, as notified by the Directors to the
Australian Securities Exchange in accordance with section 205G(1) of the Corporations Act 2001 (Cth), at the date of
this report.
Mark Vaile
John Conde
Julie Beeby
Paul Flynn
Fiona Robertson
Lindsay Ward
Ray Zage
Ordinary shares
1,509,317
708,620
85,000
1,970,451
75,395
77,500
10,783,134
2 (d) Directors’ meetings
The following are the number of Directors’ meetings (including meetings of committees of Directors) and the number of
meetings each Director attended during the financial year.
Director
Mark Vaile
John Conde
Julie Beeby
Paul Flynn
Fiona Robertson
Lindsay Ward
Ray Zage
Directors’
Meetings
Audit & Risk
Management
Committee
Meetings
Remuneration
Committee Meetings
Health, Safety,
Environment &
Community
Committee Meetings
Governance &
Nominations
Committee Meetings
A
15
15
15
15
15
15
15
B
15
15
15
15
15
15
14
A
6
6
-
-
6
-
-
B
6
6
-
-
6
-
-
A
7
7
-
-
-
7
-
B
7
7
-
-
-
7
-
A
-
-
5
-
5
5
-
B
-
-
5
-
5
5
-
A
2
2
2
-
-
-
-
B
2
2
2
-
-
-
-
A – Number of meetings held during the time the Director held office during the year.
B – Number of meetings the Director attended.
Page 13 | Whitehaven Coal Annual Report 2022
Directors’ Report
For the year ended 30 June 2022
3. Other
3 (a) Dividends
Paid during the year
Dividends of $79,890,000 were paid to shareholders during the year ended 30 June 2022 (2021: nil).
Declared after end of year
On 25 August 2022, the Directors declared a fully franked final dividend of 40 cents per share totalling $368.9 million to
be paid on 16 September 2022.
3 (b) Share options
Shares issued on exercise of options
During the reporting period 830,531 options were exercised.
Unissued shares under options
At the date of this report there were no unissued ordinary shares under options of the Company.
3 (c)
Indemnification and insurance of officers
Indemnification
The Company has agreed to indemnify, to the fullest extent permitted by law, all current and former Directors of the
Company against liabilities that may arise from their position as Directors of the Company and its controlled entities. The
agreement stipulates that the Company will meet the full amount of any such liabilities, including costs and expenses.
Insurance premiums
During the financial year the Company paid premiums in respect of Directors’ and officers’ liability and legal expenses
insurance contracts. Such insurance contracts insure persons who are or have been Directors or officers of the Company
or its controlled entities against certain liabilities (subject to certain exclusions).
The Directors have not included details of the nature of the liabilities covered or the amount of the premiums paid in
respect of the Directors’ and officers’ liability and legal expenses insurance contracts, as such disclosure is prohibited
under the terms of the contract.
3 (d)
Indemnification of auditors
To the extent permitted by law, the Company has agreed to indemnify its auditors, Ernst & Young, as part of the terms of
its audit engagement agreement against claims by third parties arising from the audit (for an unspecified amount). No
payment has been made to indemnify Ernst & Young during or since the financial year.
3 (e) Rounding
The Company is of a kind referred to in ASIC Corporations Instrument 2016/191, dated 24 March 2016 and, in accordance
with that Class Order, all financial information presented in Australian dollars has been rounded to the nearest thousand
unless otherwise stated.
Page 14 | Whitehaven Coal Annual Report 2022
Directors’ Report
For the year ended 30 June 2022
4. Operating and financial review
Financial headlines
Record financial performance in FY22 with Revenue of $4.9 billion, earnings before interest, tax and depreciation
(EBITDA) of $3.1 billion and net profit after tax (NPAT) of $2.0 billion.
In FY22, Whitehaven delivered a Total Shareholder Return (TSR) of 154%, which made it the best performing
company in the ASX 100 group of companies.
$442.4 million in capital returned to shareholders through an interim dividend of 8 cents per share ($79.8 million)
and a share buyback ($362.6 million). Combined with a fully franked final dividend of 40 cents per share ($368.9
million), the total return to shareholders for the year represents an 51% payout ratio.
gC NEWC benchmark prices for high-CV coal set new records in the year and are up 214% over the past year.
Whitehaven achieved a record average coal price of A$325/t for FY22.
FY22 production and sales guidance was delivered following strong operational performance in H2 FY22.
Whitehaven generated substantial cash flows from operations of $2.6 billion in FY22, a significant increase of
$2.4 billion from FY21.
Balance sheet strengthened with a cash balance of $1.2 billion and a net cash position of $1.0 billion at 30 June 2022.
The following table summarises the key reconciling items between the Group’s EBITDA and its profit/(loss) after tax.
Revenue
EBITDA
Net financial expenses
Depreciation and amortisation
Significant item – impairment of assets
Income tax (expense)/benefit
Net profit/(loss) after tax
Basic earnings per share (cents)
FY22
FY21
$ million
$ million
4,920.1
1,557.0
3,060.1
(55.3)
(238.9)
-
(813.9)
1,952.0
197.6
204.5
(62.0)
(260.7)
(650.0)
224.3
(543.9)
(54.6)
Review of financial performance
Whitehaven delivered a strong safety performance with a TRIFR of 5.4 for the year ended 30 June 2022, an 8%
improvement from FY21 and below the industry average. COVID-related protocols remain in place at all mines.
Improved second half operational performance aligned with record high coal prices and generated $2.0 billion of cash
from operations and $2.6 billion for FY22, an increase of $2.4 billion from FY21. The balance sheet strengthened year-on-
year with cash at 30 June 2022 increasing by $1.1 billion to $1.2 billion, after the $688 million repayment of the Syndicated
Facility, $86.5 million repayments of lease principal and the ECA facility and capital returns to shareholders of $442.4
million in FY22.
Page 15 | Whitehaven Coal Annual Report 2022
Directors’ Report
For the year ended 30 June 2022
Australian high-quality thermal coal prices reached record highs during the year, well above the previous historical highs,
driven by strong demand for high-quality energy in a supply-constrained market. Whitehaven achieved a record realised
average thermal coal price for FY22 of US$239/t.
Operational productivity, rail, and port activities in FY22 were impacted by above-average rainfall, high winds, and
flooding. The operational impacts were amplified by reduced labour availability due to COVID and COVID-related
protocols and a tight labour market. Despite these external challenges in FY22, operations delivered a strong second half
after the flood-affected first half and, together with the consistent longwall performance at Narrabri, enabled production
and sales to be delivered within guidance.
The improved operational performance, together with the record high coal price, has underpinned Whitehaven’s record
full year result with coal sales revenue of $4.9 billion, EBITDA of $3.1 billion and NPAT of $2.0 billion. This represents a
significant turnaround in performance from the net loss after tax (NLAT) before significant items of $87.3 million in FY21.
Tax expense of $813.9 million in FY22 had an effective tax rate of 29.4% which is marginally below the domestic tax rate
of 30%, primarily due to the recognition of tax losses.
Earnings
Sales of produced coal (kt)
Average realised price net of royalties (A$/t)
Cost per tonne (A$/t)
EBITDA margin on sales of produced coal (A$/t)
FY22
14,166
300
84
216
FY21
14,425
88
74
14
EBITDA margin on sales of produced coal increased to $216/t in FY22, due to:
A $212/t increase in average realised price (net of royalties) from $88/t in FY21 to $300/t in FY22.
Higher FOB unit costs which at $84/t were $10/t above FY21. FY22 unit costs were impacted by wet weather and
flooding, higher demurrage costs due to adverse weather conditions, rising diesel prices, labour market constraints,
lower mine yields and the impact of COVID.
Margins were enhanced by taking advantage of record spreads between 6000kcal/kg NAR and lower grades of
coal by washing ROM coal ‘harder’ to produce higher quality coals that were used to blend up lower grade coal at
the marginal cost of lower yields.
Revenue
Price Indices
gC NEWC index price (US$/t)
JSM Quarterly (SSCC) index (US$/t)
Price achieved
Average achieved price (A$/t)
Average achieved thermal price (US$/t)
Average achieved metallurgical price (US$/t)
Metallurgical coal sales (% of total)
Average AUD:USD exchange rate
FY22
FY21
248
253
325
239
232
18%
0.73
79
88
95
68
85
15%
0.75
Higher coal prices drove an increase in revenue of $3.4 billion to $4.9 billion in FY22 with production and sales volumes
remaining largely in line with FY21 despite the external challenges faced. Revenue and the average realised coal price
were enhanced by the ‘wash harder’ strategy to maximise the availability and quality of high-CV coal.
Whitehaven realised an average thermal coal price for FY22 of US$239/t, a 4% discount to the gC NEWC index which
was due to:
pricing mechanisms (fixed price in advance, linked to prior quarters or month of scheduled shipment) and a realised
average price that lagged the index in a rapidly rising market
the higher proportion of sales that were priced with reference to sub gC NEWC 6000kcal/kg NAR pricing structures.
Page 16 | Whitehaven Coal Annual Report 2022
Directors’ Report
For the year ended 30 June 2022
Unit costs
Outlined below are the key factors, principally uncontrollable events and inflationary cost pressures, which contributed to
the increase in FOB unit costs to $84/t in FY22.
Lower yield of 83% compared to FY21 yield of 84% due to processing coal from deeper seams at Maules Creek and the
marketing strategy to wash ROM coal ‘harder’ to produce higher quality coals trading off lower yields and higher costs
for higher revenues.
An increase in the A$ cost of diesel used in production and coal transportation due to rising crude oil prices.
Higher demurrage costs due to port movement constraints caused by high winds and swell, wet weather and floods
and NCIG’s ship loader SL02 returning to full service in late July 2021.
The impact of unusually heavy rain and flooding on operational productivity and sales volumes at open cut operations
including underutilised rail take or pay costs.
General inflationary cost pressures including impacts of a tight labour market and the spread of COVID and its
associated impact on workforce availability and operational productivity partially offset by improved production.
Cash flows and capital management
Cash flow summary
Cash generated from operations
Investing cash flows
Financing cash flows
Cash at the end of the period
Capital management
Net cash/(debt)1
Undrawn syndicated facility
FY22
FY21
$ million
$ million
2,582.0
(177.2)
(1,232.4)
1,215.5
169.5
(103.6)
(46.7)
95.2
30 June 2022
30 June 2021
1,037.8
1,000.0
(808.5)
312.0
1 Calculated in accordance with the senior facility covenant requirements and therefore excludes lease liabilities recognised under AASB 16 Leases of $67,006,000
(2021: $88,987,000).
Cash generated from operations
There was a substantial increase in cash generated from operations to $2.6 billion in FY22 weighted to the second half in
which $2.0 billion was generated from a stronger operational performance and record high coal prices.
Investing cash flows
Investing cash outflows during FY22 of $177.2 million are up $73.6 million on FY21, reflecting an increased investment in
operations and strategic projects after the tight management of capital expenditure in FY21.
Whitehaven has continued to allocate sustaining capital to each of its mines to maintain safe and productive operations,
with $98.1 million invested into operational and sustaining capital expenditure (+$32.0 million) and mains development
Page 17 | Whitehaven Coal Annual Report 2022
Directors’ Report
For the year ended 30 June 2022
recommencing at Narrabri $26.1 million (+$23.5 million). Further investment in strategic projects continued during the
year with spend on the development projects of $33.8 million (+$11.6 million) and payments of $23.1 million relating to
consideration paid in respect of the acquisition of EDF’s interest in the Narrabri mine and the acquisition of APG’s rights
to a 1% private royalty on Narrabri coal sales.
Financing cash flows and capital management
Net cash used in financing activities during FY22 was $1.2 billion, with the surplus cash generation used to create a
resilient balance sheet (full repayment of senior bank facility) and recommence capital returns to shareholders ($438.8
million) to drive long-term sustained shareholder value through both share buybacks ($359.0 million) and dividends
(FY22 interim $79.8 million). Total share buybacks for the year of $362.5 million include a share trade transaction entered
into on 30 June 2022 for $3.6 million that was paid on 4 July 2022.
Whitehaven finished the year in a net cash position of $1.0 billion. The significant turnaround from an $808.5 million net
debt position at the end of FY21 was underpinned by the strong operating cash flows in FY22.
Available liquidity of $2.2 billion at 30 June 2022 was comprised of undrawn capacity of $1.0 billion under the senior bank
facility at 30 June 2022 together with cash balances of $1.2 billion.
Review of operations
Safety
Whitehaven reported a TRIFR of 5.4 for the 12 months ended 30 June 2022. The Company is committed to achieving
zero harm to its people and the environment, and management is striving for better safety performance across all
operations.
Production, sales and coal stocks
Whitehaven share (000t)
ROM Coal Production
Saleable Coal Production
Sales of Produced Coal
Sales of Purchased Coal
Total Coal Sales
Coal Stocks at Year End
FY22
16,117
13,852
14,166
1,247
15,413
2,065
FY21
16,476
13,692
14,425
2,007
16,432
2,704
Movement
(2%)
1%
(2%)
(38%)
(6%)
(24%)
Tonnages in the table above are presented on an equity basis. Production tables and associated commentary set out in the mine-by-mine analysis are presented on a
managed (100%) basis.
Following flood-impacted first half performance, Whitehaven recorded a strong second half ending the year with ROM
coal production of 16.1Mt, saleable coal production of 13.9Mt, sales of produced coal of 14.2Mt and total coal sales of
15.4Mt which were in line with guidance.
The key features for the year include:
ROM coal production, saleable production and sales were within guidance and in line with FY21 despite the challenging
operating environment with COVID and weather impacts.
Consistent longwall performance at Narrabri.
Sales of purchased coal in FY22 of 1.2Mt were 38% lower than FY21 of 2.0Mt due to the supply constrained market.
Coal stocks at 30 June 2022 were 2.1Mt, a 24% decrease compared to 30 June 2021 of 2.7Mt, due to the timing of ROM
coal production in FY22 and the drawdown of coal stocks at Maules Creek partially offset by increased ROM coal
production at Tarrawonga.
Page 18 | Whitehaven Coal Annual Report 2022
Directors’ Report
For the year ended 30 June 2022
Maules Creek
Ownership: Whitehaven 75% and Operator, ICRA MC Pty Ltd 15%, J-Power Australia Pty Ltd 10%
Maules Creek 100% (000t)
ROM Coal Production
Saleable Coal Production
Sales of Produced Coal
Coal Stocks at Year End
FY22
11,220
9,372
9,612
1,012
FY21
12,664
9,340
9,606
2,316
Movement
(11%)
0%
0%
(56%)
Note: Tonnages in the above table are presented on a managed basis.
Maules Creek delivered ROM coal production of 11.2Mt in FY22, 11% below FY21, with weather and COVID impacting ROM
coal production. Consecutive quarters of improved ROM coal production were delivered to finish the year following the
flood-affected December quarter, however not quite back to the ROM coal production levels achieved at the end of FY21
due to ongoing challenges presented by a tight labour market, COVID absences and continued above average rainfall.
Despite the operational challenges from weather and COVID, saleable coal production of 9.4Mt and managed sales
volumes of 9.6Mt were broadly in line with FY21.
Coal stocks for the end of the period were 1.0Mt, down 1.3Mt or 56% from FY21, reflecting the timing of ROM production
in FY22 and the drawdown of stock.
Narrabri
Ownership: Whitehaven 77.5% and Operator, J-Power 7.5%, Upper Horn Investments Limited 7.5%,
Daewoo International Corporation and Korea Resources Corporation 7.5%
Narrabri Mine 100% (000t)
ROM Coal Production
Saleable Coal Production
Sales of Produced Coal
Coal Stocks at Year End
FY22
4,802
4,795
4,617
270
FY21
4,059
3,985
4,541
210
Movement
18%
20%
2%
29%
Note: Tonnages in the above table are presented on a managed basis.
In FY22 managed ROM coal production at Narrabri of 4.8Mt was 18% above FY21, reflecting consistent longwall
performance.
Saleable coal production of 4.8Mt was 20% above FY21, which was consistent with ROM production and processing.
Managed sales volumes of 4.6Mt were 2% above FY21, reflecting saleable coal volumes, the slippage of sales into FY23
and also the drawdown of stock in FY21.
Coal stocks of 0.3Mt are marginally up on FY21.
Gunnedah open cut mines
Ownership: Werris Creek Whitehaven 100% & Tarrawonga Whitehaven 100%
Open Cuts 100% (000t)
ROM Coal Production
Saleable Coal Production
Sales of Produced Coal
Coal Stocks at Year End
FY22
3,981
3,107
3,344
1,097
FY21
3,832
3,599
3,628
804
Movement
4%
(14%)
(8%)
36%
Gunnedah open cut mines consist of Tarrawonga mine and Werris Creek mine. The combined ROM coal production of
the two mines for FY22 was 4.0Mt, 4% above FY21, reflecting an on-par performance at Werris Creek and an improved
performance at Tarrawonga despite the operational challenges posed by weather and COVID.
Saleable coal production of 3.1Mt was 14% below FY21 due to an overall lower yield at Tarrawonga due to an increased
proportion of coal being washed to produce high-CV products for blending to improve margins, restricted access in the
December flooding event, lower road haulage volumes due to weather impacts and COVID related absences, and the
timing of ROM coal production. Sales for the period were 3.3Mt, 8% below FY21 reflecting the saleable coal production
profile.
Coal stocks at the end of June were 1.1Mt, 0.3Mt above FY21, reflecting the increased ROM coal production in the June
quarter at Tarrawonga.
Page 19 | Whitehaven Coal Annual Report 2022
Directors’ Report
For the year ended 30 June 2022
Development projects
Whitehaven acquired the quality assets of Vickery and Winchester South from Rio Tinto in 2010 and 2018 respectively.
The Vickery mine will produce a majority of metallurgical coal for steel making, with the balance being high quality
thermal coal while the Winchester South mine will produce high quality coking coal with a by-product of thermal coal for
energy generation.
Vickery
Ownership: Whitehaven 100%
In August 2020 the Vickery Extension Project received approval from the NSW Independent Planning Commission (IPC)
to operate an up to 10Mtpa open cut metallurgical and thermal coal mine, with onsite processing and rail infrastructure.
On 16 September 2021 the Federal Minister for the Environment approved the Project under the Commonwealth’s
Environment Protection and Biodiversity Conservation Act 1999 (the EPBC Act).
Works are being undertaken as required for secondary approvals such as water, noise, air quality, cultural heritage and
traffic management. Additional geological drilling and geotechnical works are underway to help further refine the mine
plan and detailed design of the mine infrastructure.
Winchester South
Ownership: Whitehaven 100%
Winchester South is a large, undeveloped coal project about 30km from Moranbah in Queensland’s Bowen Basin which is
regarded as one of the premier metallurgical coal basins. At full capacity the mine is targeting an average ROM
production of 15Mtpa to supply the international market for about 30 years.
The Project continues to progress through the Queensland Government’s Coordinated Project approval process.
On 20 April 2022, Whitehaven Coal released its update to its Resources and Reserves Statement for the Winchester
South Project in accordance with the JORC Code (2012). The updated declaration provides further confidence around
resource definition and includes increased metallurgical coal tonnage and quality. Key highlights include:
JORC Reserves upgraded to 380Mt, from 350Mt
JORC Proved Reserves upgraded to 270Mt, from 140Mt
60% of the marketable reserves comprise metallurgical semi hard coking coal (SHCC)
JORC Resources of 1,100Mt, inclusive of 670Mt of Measured and Indicated Resources
20+ year open cut mine life, targeting 15Mtpa ROM production
average prime strip ratio of 5.0 bcm/tonne ROM and product strip ratio of 9.1 bcm/tonne product.
Narrabri Stage 3 Extension
Ownership: Whitehaven 77.5%
The Narrabri stage 3 extension project is an extension of the existing Narrabri underground mine.
On 1 April 2022, the IPC announced that it had approved the Narrabri Stage 3 Extension Project, subject to meeting a
range of IPC conditions, including in relation to emissions mitigation technology and measures.
The project extends the life of the Narrabri underground mine from 2031 to 2044.
Federal EPBC approval and an application for a mining lease are being finalised along with the required secondary
approvals prior to commencement of the project.
In early July, Whitehaven was notified that a client of the Environmental Defenders Office (EDO) had commenced judicial
review proceedings in the NSW Land and Environment Court in respect of the Consent granted by the IPC. Whitehaven
takes its role to support energy security and economic development goals in the Asia region extremely seriously and
intends to defend the proceedings vigorously to ensure Narrabri remains a responsible and reliable source of coal
throughout the energy transition.
Infrastructure
Rail track capacity
Whitehaven contracts its below rail capacity from the Australian Rail Track Corporation (ARTC). During FY22 the rail
network was significantly impacted by a number of localised flooding events in different areas. ARTC was able to repair
the damaged network.
Page 20 | Whitehaven Coal Annual Report 2022
Directors’ Report
For the year ended 30 June 2022
Rail haulage capacity
Whitehaven has capacity within its two long-term rail haulage contracts for all current NSW-based mine production
plans.
Whitehaven has been working with our rail haulage providers on improvement projects which will allow our logistics
network to operate more efficiently and reliably.
The rail operators continued to be adversely impacted by COVID throughout FY22 leading to reduced trains running.
Both rail operators have a number of strategies in place to minimise the impact whilst continuing to provide a safe and
reliable service for Whitehaven’s transport requirements.
Port capacity
Whitehaven exports coal through the Port of Newcastle using the two export terminal providers PWCS and NCIG.
As previously reported an NCIG shiploader was damaged in late 2020. The repairs were completed ahead of schedule
and the shiploader returned to service in late July 2021.
Significant and repeated weather events throughout FY22 had a temporary adverse impact on the movement of ships
into and out of the Port of Newcastle leading to increased vessel queues and higher demurrage costs.
Events subsequent to reporting date
In the interval between the end of the financial year and the date of this report there has not arisen any item, transaction
or event of a material and unusual nature likely, in the opinion of the Directors of the Company, to significantly affect the
operations of the Group, the results of those operations, or the state of affairs of the Group, in future financial years, other
than the following:
Subsequent to the end of the financial year, the Directors declared a fully franked final dividend of 40 cents per share
totalling $368.9 million to be paid on 16 September 2022.
John Conde has advised that he will not stand for re-election at the Company’s Annual General Meeting on 26 October
2022.
Outlook and likely developments
Thermal and Metallurgical Coal Outlook
Energy security is expected to remain a key priority while there is a continuing global energy supply shortfall –
particularly for high quality thermal coal. It is likely to take several years before additional supply or alternative energy
sources are available in the global energy complex to rebalance supply and demand.
Throughout the coming multi-decade decarbonisation transition, reliable baseload energy will be required, delivering
continued strong demand for Whitehaven’s high-quality coal that supports lower emissions relative to other coal
products. As a result, ongoing prices for high-CV thermal coal are likely to remain well supported.
In the near term, thermal coal prices are expected to be robust as a result of the incoming sanctions on Russian coal into
Europe and heavy rainfall experienced in the Hunter Valley in early July.
In metallurgical markets, while pricing is relatively strong compared to historical levels, it is expected that there will be
further volatility due to global economic pressures in the near term. While longer-term there is a positive demand outlook
for metallurgical coal and underpinning prices, in the near term we will continue to leverage opportunities to maximise
volumes of higher priced thermal coal sales.
Risks relating to Whitehaven’s future prospects
Whitehaven operates in the coal sector. There are many factors, both specific to Whitehaven and to the coal industry in
general, that may individually or in combination affect the future operating and financial performance of the Group, its
prospects and/or the value of Whitehaven. Many of the circumstances giving rise to these risks are beyond the control of
Whitehaven’s Directors and its management. The major risks believed to be associated with investment in Whitehaven
are as follows.
Volatility in coal prices
The Company’s future financial performance will be impacted by future coal prices. Factors which affect coal prices
include the outcome of future sales contract negotiations, general economic activity, industrial production levels, changes
in foreign exchange rates, changes in coal demand, changes in the supply of seaborne coal, changes in international
freight rates and the cost of substitutes for coal. The Company does not currently hedge against coal price volatility.
Page 21 | Whitehaven Coal Annual Report 2022
Directors’ Report
For the year ended 30 June 2022
Foreign currency risk
As the Company’s sales are predominately denominated in US dollars, adverse fluctuations in the USD:AUD exchange
rate may negatively impact the Group’s financial position.
The Company uses forward exchange contracts to hedge some of this currency risk in accordance with a hedging policy
approved by the Board of Directors.
Acquisitions and commercial transactions
Acquisitions and commercial transactions undertaken with the objective of growing the Company’s portfolio of assets are
subject to a number of risks which may impact the ability to deliver anticipated value. Risks associated with acquisitions
include:
operational performance of acquired assets not meeting expectations
anticipated synergies or cost savings delayed or not achieved
adverse market reaction to proposed transactions
the imposition of unfavourable or unforeseen conditions, obligations or liabilities.
Whitehaven’s commercial processes are designed to reduce the likelihood of these risks materialising as a result of a
commercial transaction.
Capital requirement and insurance risk
There is a risk that insufficient liquidity or the inability to access funding or insurance on acceptable terms may impact
ongoing operations and growth opportunities.
Whitehaven manages liquidity risk by holding a prudent level of available cash, maintaining adequate committed credit
facilities which have been provided by a diverse panel of Australian and international banks, and refinancing committed
credit facilities typically before they become current liabilities.
As at 30 June 2022, Whitehaven had $1.2 billion of cash on hand with additional headroom from the undrawn $1 billion
senior secured debt facility which expires on 31 July 2023.
Capital allocation and development risks
There is a risk that circumstances (including unforeseen circumstances) may cause delays to project development,
exploration milestones or other operating factors, resulting in the receipt of revenue at a date later than expected.
Additionally, the construction of new projects/expansion by the Company may exceed the currently envisaged
timeframe or cost for a variety of reasons outside of the control of the Company.
Missed opportunities to invest or a failure to effectively allocate capital or achieve expected return from assets may also
lead to a failure to achieve expected commercial objectives.
Operating risks
The Company’s coal mining operations are subject to operating risks that could impact the amount of coal produced at
its coal mines, delay coal deliveries or increase the cost of mining for varying lengths of time. Such difficulties include
weather and natural disasters, unexpected maintenance or technical problems, failure of key equipment, higher than
expected rehabilitation costs, industrial action, labour shortages and higher than expected labour costs.
Geological uncertainty is also an inherent operational risk which could result in pit wall failures or rock falls, mine collapse,
cave-ins or other failures to mine infrastructure.
The Company has in place a framework for the management of operational risks and a comprehensive group insurance
program which provides insurance coverage for a number of these operating risks.
Water security and management
Water is critical to Whitehaven’s mining operations as it is used for various purposes, including dust suppression and coal
washing. Whitehaven’s ability to access water may be impacted by a number of factors, including drought, changes in
government policy and regulation, and scarcity of supply. The inability to access sufficient water may negatively impact
Whitehaven’s costs, future production and financial performance.
Proactive water management is also required to ensure operations are not impacted by excess water. The inability to
adequately dewater or store excess water onsite may limit production, sterilise coal and result in unauthorised water
discharge from site.
Whitehaven regularly monitors the water balance at each of its sites, invests in water management infrastructure and
investigates opportunities to minimise water usage and secure alternate, reliable water sources to build resilience against
water availability risks.
Page 22 | Whitehaven Coal Annual Report 2022
Directors’ Report
For the year ended 30 June 2022
Infrastructure risks
Coal produced from Whitehaven’s mining operations is transported to customers by a combination of rail and ship. A
number of factors could disrupt these transport services, including a failure of infrastructure providers to increase
capacity in order to meet future export requirements.
Rail and port capacity is obtained predominantly through long-term contract arrangements which include take-or-pay
provisions which require payments to be made irrespective of whether the service is used. In the event utilised capacity is
below contracted capacity, there is a risk Whitehaven will be required to pay take-or-pay charges for capacity which is
not used. Whitehaven seeks to align these take-or-pay infrastructure obligations with the Company’s forecasted future
production.
Geology risks
There are inherent risks associated with estimating Coal Resources and Reserves, including subjective judgements and
determinations as to coal quality, geological conditions, tonnage and strip ratio. The Company’s Resource and Reserve
estimates are determined by suitably qualified competent persons in accordance with the Australasian Code for
Reporting of Exploration Results, Mineral Resources and Ore Reserves (JORC Code).
Cyber risk
Whitehaven’s operations are supported by a robust information technology security framework and back-up data
infrastructure. However, computer viruses, unauthorised access, cyber-attack and other similar disruptions may threaten
the security of information and impact operational systems. The Company manages this risk by continuing to invest in
systems to prevent such attacks and undertaking staff training programs.
Counterparty risk
The Company deals with a number of counterparties, including joint venture partners, suppliers and customers.
Counterparty risks include:
non-supply or changes to the quality of key inputs, which may impact costs and production at operations
failure to reach agreement with joint venture partners, which could impact the Company’s ability to optimise value
from its projects
failure of customers to perform against long-term take-or-pay agreements.
Counterparty risk is assessed prior to entry into any new arrangements and, if necessary, appropriate risk control
mechanisms are put in place. Whitehaven proactively engages with its counterparties to manage instances of non-supply
and quality control and to ensure alignment of expectations.
Environment and safety risks and licence to operate
A range of health, safety and environmental risks exist with coal mining activities. Accidents, environmental incidents and
real or perceived threats to the environment or the amenity of local communities could result in a loss of the Company’s
social licence to operate, leading to delays, disruption or the shutdown of operations. Potential environmental and safety
risks include equipment failure, human errors in underground operations, vehicle and mining equipment interactions in
open cut operations, roof fall hazards in underground operations and spontaneous combustion risks.
The Company engages with a number of different stakeholders in the communities within which it operates. Stakeholder
related risks include:
the requirement to comply with the Native Title Act 1993 (Cth), which can delay the grant of mining tenements and
impact the timing of exploration, development and production operations
the ability to reach agreement with local landholders in relation to acquisition and/or access terms, which may delay
the timing of project development
notwithstanding the contributions made to the communities within which the Company operates, local communities
may become dissatisfied with the impact of operations or oppose new development projects. There is also the
possibility of anti-coal activism targeted towards the Company’s projects.
Whitehaven has a comprehensive environmental, health and safety management system to mitigate the risk of incidents
and to ensure compliance with environmental and safety laws. The Company also has a dedicated community relations
team that engage with local communities to ensure that community issues are understood and addressed appropriately.
Further details in relation to how the Company engages effectively with the communities in which we operate and steps
which the Company takes to maintain its social licence to operate will be provided in the Company’s 2022 Sustainability
Report to be released later this year.
Page 23 | Whitehaven Coal Annual Report 2022
Directors’ Report
For the year ended 30 June 2022
Legal and regulatory risk
The coal sector is subject to a broad range of laws, regulations and standards including in relation to taxation, royalties,
environmental matters and greenhouse gas emissions. A change in the laws, regulations or standards applicable to
Whitehaven could result in increased costs, regulatory action, litigation or, in extreme cases, threaten the viability of an
operation.
Whitehaven actively monitors legislative and regulatory developments and engages appropriately with legislative and
regulatory bodies to manage this risk.
Climate change risk
The physical and non-physical impacts of climate change are interlinked with multiple other risks and may affect the
Company’s assets, production and the markets where its products are sold. These impacts may include severity and
frequency of weather patterns, policy and regulatory change and coal demand responses. Further details in relation to
climate change risks will be provided in the Company’s 2022 Sustainability Report.
The International Energy Agency (IEA) has outlined under both its enduring Stated Policies Scenario and Sustainable
Development Scenario (which assumes warming is limited to below 2 degrees), that coal demand in Whitehaven’s key
export market, Asia, will remain beyond 2040. The IEA regularly makes projections about world coal demand based on
various future scenarios for energy development. Its most recent World Energy Outlook (2021) including alternate
scenarios and further details is available at: https://webstore.iea.org/world-energy-outlook.
COVID risk
As with most businesses around the world, the COVID pandemic has presented a range of health, commercial and
financial risks to Whitehaven. This includes risk to continuity of operations, and potential disruptions to the movement of
goods and people. Since before the pandemic emerged in Australia, we have been carefully planning to ensure continuity
of supply of inputs, and have taken a range of steps – including direct advocacy to key government and other
stakeholders – to ensure our workforce is ready to respond to the pandemic and is not adversely impacted by domestic
border restrictions, limiting the operational impacts we have experienced. Whitehaven, and the resources sector more
broadly, has so far demonstrated its resilience in the face of COVID. It has been widely acknowledged that the
comprehensive suite of measures adopted across the resources sector quickly became the model for others to emulate.
The development and rapid implementation of our response plan kept our people safe and supported continuity of
production and employment. More broadly the experience of responding to COVID has validated the robustness of our
WHS systems and procedures and ensured our preparedness to manage any future emerging risks of this nature.
The exceptional circumstances stemming from the pandemic have resulted in uncertainty surrounding public health and
the global economy, including impacts on energy and industrial markets. Throughout the pandemic, our portfolio of coal
products has remained sought after and well sold under long-term contracts to the cornerstone high-energy, low-
impurity coal markets of Japan, Korea and Taiwan, as well as emerging markets in developing Southeast Asian nations.
Attract and retain people
Whitehaven’s ability to achieve its business strategy depends on attracting, developing and retaining a wide range of
skilled and experienced employees and contractors. An inability to attract or retain such personnel could adversely
affect the success of Whitehaven’s business.
Whitehaven seeks to manage this risk by designing employment arrangements and succession plans to secure and retain
key personnel. Whitehaven also seeks to build a future supply of industry labour by actively promoting the resources
industry in the local communities where it operates.
Page 24 | Whitehaven Coal Annual Report 2022
Directors’ Report
For the year ended 30 June 2022
5. Auditor independence and non-audit services
5 (a) Auditor’s independence declaration
The auditor’s independence declaration forms part of the Directors’ Report for the financial year ended 30 June 2022. It
is set out on page 26.
5 (b) Non-audit services
During the year Ernst & Young, the Company’s auditor, has performed certain other assurance services in addition to
their statutory duties.
The Board considered the non-audit services provided during the year by the auditor and, in accordance with written
advice provided by resolution of the Audit & Risk Management Committee, were satisfied that the provision of those non-
audit services by the auditor was compatible with, and did not compromise, the auditor independence requirements of
the Corporations Act 2001 (Cth) for the following reasons:
All non-audit services were subject to the corporate governance procedures adopted by the Company and were
reviewed by the Audit & Risk Management Committee to ensure they did not impact the integrity and objectivity of
the auditor.
The non-audit services provided did not undermine the general principles relating to auditor independence as set out
in APES 110 Code of Ethics for Professional Accountants, as they did not involve reviewing or auditing the auditor’s
own work, acting in a management or decision making capacity for the Company, acting as an advocate for the
Company or jointly sharing risks and rewards.
Details of the amounts paid or payable to the auditor of the Company, Ernst & Young, and their related practices for non-
audit services provided during the year are set out below:
In AUD
Non-audit services
Ernst & Young
Review of National Greenhouse and Energy Reporting Act 2007 requirements
Debt capital markets assurance services
Consolidated
2022
Consolidated
2021
$
$
115,000
209,741
324,741
60,000
-
60,000
Page 25 | Whitehaven Coal Annual Report 2022
Auditor’s independence declaration
Directors’ Report
For the year ended 30 June 2022
Page 26 | Whitehaven Coal Annual Report 2022
2022 Remuneration Report
Directors’ Report
For the year ended 30 June 2022
(Audited)
Summary
On behalf of the Board, we are pleased to present
Whitehaven Coal’s Remuneration Report for the
financial year ended 30 June 2022 (FY22).
Our executive remuneration framework is designed to
align with shareholder interests while incentivising and
rewarding senior executives to build a cost-competitive
asset portfolio, and to develop and operate that
portfolio of assets in a safe and sustainable way.
Whitehaven’s performance in FY22
The safety and wellbeing of our people, and protecting
the environment in the communities in which we work
remain our top priorities. We continue to invest in best
practice health and safety procedures, training and
technologies. As a result of the efforts across our
workforce, our Total Reportable Injury Frequency Rate
(TRIFR) has improved, reducing from 5.9 in FY21 to 5.4
in FY22, and continues to track better than comparable
industry performance. As a result of our continued
focus and investment, we have also seen improvement
in our environmental performance with a reduction in
incidents occurring during the performance year.
A dynamic coal market in FY22 presented Whitehaven
with opportunities to deliver exceptional outcomes for
shareholders. Our executive team responded
accordingly, leveraging our ability to produce high-
quality coal and realise market premiums. The result
has been a record financial year, with shareholders
benefiting from substantial share value growth and
capital returns through an on-market share buy-back
and reinstatement of dividends.
The year was not without its challenges however. Like
many organisations, Whitehaven faced significant
COVID-related labour constraints and a very tight
labour market throughout the year. Additionally, wet
weather events in late 2021 disrupted production
schedules, impacting both ROM and overburden
results. Also consistent with the broader mining
industry, Whitehaven faced escalating diesel, labour,
demurrage, and explosive costs, resulting in unit costs
at the upper end of the revised cost guidance range for
the year. In addition, as a result of deliberate decisions
to produce higher cost but higher margin products,
production and cash costs were higher. These
decisions contributed approximately $1.0 billion to the
final EBITDA result.
Overall, the Board is pleased with the performance of
the business in FY22 and recognises the significant
value created for shareholders as a result of
management’s strategic focus in driving production,
and executing marketing and sales strategies to
maximise earnings.
Remuneration outcomes for FY22
This year’s Key Management Personnel (KMP)
remuneration outcomes reflect the strong financial and
non-financial performance of the business over the past
year, notably:
record EBITDA result of $3.1 billion, up from $204.5
million
8% lower TRIFR in FY22, down to 5.4 from 5.9 in
FY21
environment enforcement actions down to 4 from 5
in FY21.
As outlined in section 4.2 of this report, the Board has
assessed performance of both the Company and each
individual KMP in determining remuneration outcomes.
Overall, the 86% of maximum scorecard outcome
reflects the strong financial results of the business in
FY22 while also acknowledging the impact that certain
uncontrollable factors and strategic decisions have had
on management’s ability to meet targets - specifically
ROM production, overburden and cash costs.
The Board believes these remuneration outcomes are
consistent with our shareholders’ experience through
FY22, and reflect management’s ability to capitalise on
market opportunities for the overall benefit of our
shareholders.
Remuneration framework changes in FY23
Following the 2021 Annual General Meeting, at which
many voting shareholders expressed concerns with our
existing remuneration framework, the Board undertook
a comprehensive review of the framework, supported
by remuneration consultants Godfrey Remuneration
Group.
We considered carefully feedback from shareholders,
investors and proxy advisors. As outlined in Section 5,
from FY23 we are introducing a new Single Incentive
Plan (SIP) which replaces our existing Short-term
Incentive (STI) Plan and Long-term Incentive (LTI) Plan.
We believe this new framework better reflects
shareholder interests by placing a strong focus on key
annual operational imperatives, while also aligning with
shareholders through material equity components. To
further support this we have introduced a Minimum
Shareholding Requirement. With the majority of
remuneration delivered through equity, executives are
encouraged to continue to behave like owners, focus
on creating long-term value and remain with the
organisation through market cycles.
Our remuneration framework must also be market
competitive in order to attract, motivate and retain the
best people. This is proving to be increasingly
challenging in the coal industry and will likely continue
to be difficult in years to come. As a result, we target
the 75th percentile for total fixed remuneration (TFR)
to ensure we can attract the capability needed to
deliver superior results. This important policy change
has led to one-off TFR increases for our KMP in FY23,
and reflects our desire to retain our talented
management team. As outlined in section 5.1, fixed
remuneration for the Managing Director and CEO, Paul
Flynn, will increase to $1,888,000 (+21%), for the Chief
Financial Officer, Kevin Ball, it will increase to $880,000
(+21%) and for the Executive General Manager (EGM)
Page 27 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
Operations, Ian Humphris, it will increase to $850,000
(+21%).
The Board continues to consider Executive KMP
remuneration in the context of our strategy, relevant
benchmarks and appropriate rewards for our
management team. With our new SIP, we believe we
have balanced these competing interests appropriately
and that we remain focused on delivering sustainable
long-term returns to shareholders and valued
outcomes for all our stakeholders.
Non-Executive Directors’ fees
Non-Executive Directors’ fees have not increased since
1 July 2017. A full market benchmarking exercise was
undertaken during FY22 and as a result, as detailed in
section 7.2, Board fees, but not Committee fees, have
increased from 1 July 2022. Importantly, no increase is
being sought to the Non-Executive Directors fees pool
for FY23. Further, Non-Executive Directors will also be
subject to the new Minimum Shareholding
Requirements.
We thank the Executive KMP and their teams for their
continued commitment and contribution to
Whitehaven.
Page 28 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
Table of Remuneration
Report contents
1.
Introduction
1.1. Response to concerns raised regarding the FY21 Remuneration Report
1.2. Key Management Personnel for FY22
2. Remuneration governance, principles and framework
2.1. Remuneration governance model
2.2. Remuneration Principles
2.3. Connecting our Principles to our Remuneration Framework
3.
FY22 Remuneration Framework
3.1. Mix and timing of Executive KMP remuneration in FY22
3.2. Fixed remuneration
3.3. FY22 STI award structure
3.4. FY22 LTI award structure
3.5. Policies and conditions of rights awarded under equity plans
3.6. Benchmarking total remuneration
4. FY22 Remuneration Outcomes
4.1. Summary of Company performance
4.2. FY22 Executive KMP STI outcomes
4.3. FY22 Executive KMP LTI vesting outcomes
4.4. LTI awards granted in FY22
4.5. Summary of Executive KMP total realised remuneration outcomes
5. Changes to the Remuneration Framework from FY23
5.1. Fixed Remuneration
5.2. New Single Incentive Plan
5.3. New Minimum Shareholding Requirements
6. Executive KMP employment contracts
7. Non-Executive Director remuneration
7.1. Non-Executive Director fees
7.2. FY22 and FY23 Board and Committee Fees
7.3. FY22 Non-Executive Director remuneration
8.
Executive KMP statutory tables and additional disclosures
8.1. Executive KMP statutory remuneration table
8.2. Movement in options and rights held by Executive KMP
8.3. Movement in ordinary shares held by KMP
8.4. Related party transactions and additional disclosures
Page 29 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
1. Introduction
This Remuneration Report forms part of the Directors’ Report.
In accordance with Section 308 (3C) of the Corporations Act 2001 (Cth), the external auditors, Ernst & Young, have
audited this Remuneration Report.
1.1. Response to concerns raised regarding the FY21 Remuneration Report
At the 2021 AGM, 53.49% of votes cast by voting shareholders were against the FY21 Remuneration Report. Since then,
the Whitehaven Coal Board and Remuneration Committee have consulted with proxy advisors, institutional investors and
other stakeholders. The feedback has been valuable and has been incorporated into the FY22 review of our remuneration
framework as well as the disclosure of outcomes. The key issues and concerns raised during these discussions are listed
below.
Key concerns
Response
1. Misalignment between guidance and STI gateway from both a
ROM and FOB perspective
From FY22 guidance and incentive targets will be more clearly
aligned.
2. Lack of minimum shareholding requirement
3. Perception that management was not held to account for FY18
and FY19 environmental incidents and that five incidents in FY21
was too high for executives to be awarded at Stretch outcome
4. Limited STI target disclosure
5. High CEO fixed pay relative to comparators on a market
capitalisation basis
6. The FY21 STI outcomes appear high relative to FY20
The Board recognises the importance of maintaining strong alignment
between shareholders and the Company’s leadership. Following
shareholder feedback, a minimum shareholding requirement is being
introduced for all KMP including Board members and executives, as
outlined in section 5.3.
This report contains increased disclosure in section 4.2, which
provides clarity between previous environmental incidents and
executive remuneration outcomes relating to the financial year in
which the incident occurred.
Section 4.2. includes improved retrospective disclosure of FY22 STI
targets
In conjunction with independent consultants Mercer, a comprehensive
benchmarking exercise was undertaken in FY22, taking into account
Whitehaven’s current size and complexity. Pay practices across
comparable ASX200 industrials were also considered. While the
Board appreciates concerns regarding high fixed pay of the CEO,
following this benchmarking exercise, the Board determined that
Executive KMP fixed remuneration should increase, as attracting and
retaining top talent to the coal industry necessitates a fixed pay
premium. Further information can be found in section 3.6.
In FY21, management navigated challenging coal market and
geotechnical conditions, delivering improved performance relative to
target across a number of measures, such as FOB costs and ROM
production. The Board determined that this was an appropriate
outcome under the circumstances.
Page 30 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
1.2. Key Management Personnel for FY22
This report details the FY22 remuneration and fees of the KMP of the Company, who are listed in the table below. For the
remainder of this Remuneration Report, the KMP are referred to as either Executive KMP or Non-Executive Directors.
The following table sets out the Company’s Non-Executive Directors during FY22. All Non-Executive KMPs listed below
have held their respective positions for the full financial year.
Non-Executive Directors
Role held during FY22
Committee positions held
The Hon. Mark Vaile AO
Chairman and Non-Executive Director
Chairman of Governance & Nomination Committee
Member of Audit & Risk Management Committee
Member of Remuneration Committee
John Conde AO
Deputy Chairman and Non-Executive Director
Chairman of Remuneration Committee
Dr Julie Beeby
Non-Executive Director
Member of Audit & Risk Management Committee
Member of Governance & Nomination Committee
Chairman of Health, Safety, Environment &
Community Committee
Member of Governance & Nomination Committee
Fiona Robertson
Non-Executive Director
Chairman of Audit & Risk Management Committee
Lindsay Ward
Non-Executive Director
Member of Health, Safety, Environment &
Community Committee
Member of Health, Safety, Environment &
Community Committee
Member of Remuneration Committee
Raymond Zage
Non-Executive Director
Nil
The following table sets out the Company’s Executive KMP during FY22. All Executive KMPs listed below have held their
respective positions for the full financial year.
Executive KMP
Role held during FY22
Paul Flynn
Kevin Ball
Ian Humphris
Managing Director and Chief Executive Officer (CEO)
Chief Financial Officer (CFO)
Executive General Manager (EGM) – Operations
Dates
Full year
Full year
Full year
Page 31 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
2. Remuneration governance, principles and framework
2.1. Remuneration governance model
This section describes the roles and responsibilities of the Board, Remuneration Committee, management, external
remuneration advisers and shareholders when making remuneration decisions. It also provides an overview of the
principles and policies that underpin the Company’s remuneration framework.
During FY22 the Remuneration Committee engaged Godfrey Remuneration Group (GRG) as remuneration consultants to
provide assistance with the review and redesign of the Company's remuneration framework, as well as Non-Executive
Directors’ remuneration benchmarking. No remuneration recommendations as defined in the Corporations Act 2001 (Cth)
were made or supplied by GRG.
In addition, the organisation commissioned Mercer as remuneration consultants to provide salary benchmarking data for
Executive KMP roles. Mercer did not provide any remuneration recommendations in relation to any KMP remuneration
levels, as defined in the Corporations Act 2001 (Cth).
No remuneration recommendations were obtained during FY22 as defined under the Corporations Act 2001 (Cth).
Page 32 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
2.2. Remuneration Principles
The following principles underpin the Company’s remuneration framework:
Remuneration principles
Competitive
Equitable
Drives Performance
Aligned
It is recognised that attracting and
retaining talented employees to
the coal industry presents unique
challenges and therefore top
quartile pay is increasingly
required to remain competitive.
Structures are equitable and
reinforce relevant Company
policies, such as ensuring a focus
on a safe working environment for
all employees and on compliance
with environmental approval
conditions.
Reward outcomes are aligned with
performance, with a significant
portion of pay deemed ‘at risk’
based on challenging KPIs that are
linked to the creation of
sustainable shareholder returns.
Incentives are aligned with the
interests of the Company and its
stakeholders, including
shareholders, employees and the
communities in which we operate.
2.3. Connecting our Principles to our Remuneration Framework
Prior to the recent executive remuneration review, the Company’s Executive KMP remuneration framework was based on
a set of core principles, and comprises both fixed and at-risk remuneration components. The table below summarises the
key elements of the previous remuneration framework with respect to our core remuneration principles.
Attract and retain
skilled executives
Structures are equitable
and reinforce relevant
Company policies
Incentives are challenging
and linked to the creation of
sustainable shareholder
returns
Incentives are aligned with the
long-term interests of the
Company and its stakeholders
I
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S
O
P
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O
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Y
T
N
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T
R
O
P
P
O
F
O
S
S
A
B
I
S
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N
A
N
R
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V
O
G
Cash
Equity
Includes salary
and superannuation
50% of STI is delivered
as cash
50% of STI is deferred
into rights to receive shares in
the Company subject to meeting
service-based vesting conditions
(with vesting periods of 12 and
24 months)
Performance contingent rights
with 3 and 4 year vesting
schedules, terms of which are
determined by the Board annually.
Fixed remuneration is targeted
at the 75th percentile relative to
organisations of comparable size
and operating in similar
industries
STI opportunity is set between 70% and 100% of TFR for target
performance and between 87.5% and 125% of TFR for stretch
performance
The face value of the LTI
opportunity is set between 80%
and 120% of TFR
Set based on skills, capabilities,
experience, performance and
role complexity with reference to
external benchmarking
Outcomes based on a mix of annual financial and non-financial
performance metrics aimed at driving execution of business
strategy and creating shareholder value
Reviewed annually by the
Remuneration Committee
Ability for the Board to adjust STI outcomes to ensure outcomes
align with shareholder expectations
Vesting is subject to three
independent performance hurdles:
Relative TSR, Costs Hurdle and
Strategic Priority Delivery. The
Strategic Priority Delivery hurdle
also requires a minimum level of
absolute TSR performance.
Ability for the Board to reduce the
number of unvested rights if
subsequent events show such a
reduction to be appropriate
Page 33 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
3. FY22 Remuneration Framework
3.1. Mix and timing of Executive KMP remuneration in FY22
Executive KMP remuneration is delivered as a mix of fixed and at-risk remuneration. At-risk remuneration can be earned
through STI and LTI and is delivered to Executive KMP over multi-year timeframes to create a layered retention effect
and encourage sustained performance.
The graphs below illustrate the remuneration mix for Executive KMP for FY22 (based on maximum performance for at-
risk components):
The following diagram shows the timing for determining and delivering Executive KMP remuneration for FY22:
3.2. Fixed remuneration
KMP fixed remuneration consists of base salary and superannuation, and is subject to approval by the Remuneration
Committee. In line with Company policy and executive service agreements, remuneration levels are reviewed annually
having regard to market benchmarking, scope of role and sustained individual performance. While remuneration is
reviewed annually, increases are not guaranteed.
The combination of a limited and decreasing talent pool to draw from and increasingly demanding leadership roles has
made the attraction and retention of talented executives more and more challenging across the coal industry.
Consequently, from FY23, the Board has determined to position fixed remuneration at the 75th percentile of its market
comparator groups where appropriate for the individual executive. See section 3.6 for further explanation of our
approach to remuneration benchmarking.
Page 34 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
3.3. FY22 STI award structure
The STI provides executives with an annual incentive opportunity that rewards performance against annual targets
across a range of financial and non-financial objectives aligned to stakeholder interests. The terms of the FY22 STI are
outlined below.
The only change made relative to FY21 was the introduction of an additional safety measure, aimed at driving the
identification and rectification of potential level 4 & 5 safety hazards.
Feature
Description
Performance period
12-month performance period from 1 July 2021 to 30 June 2022
STI Opportunity
CEO: target 100% of TFR and stretch 125% of TFR
Other Executive KMP: target 70% of TFR and stretch 87.5% of TFR
Calculation of STI award The value of STI awards is calculated as follows.
Form of delivery,
vesting and exercise
The STI for FY22 will be delivered 50% in cash in September 2022 and 50% in deferred rights that are intended to be
granted in or around November 2022. Upon exercise of these rights, the recipient is entitled to receive one ordinary
share in the Company for each deferred right that vests.
Half of the deferred rights vest and become exercisable following completion of FY23, while the other half will vest
and become exercisable following the completion of FY24, subject to meeting service conditions. Vested deferred
rights that have not been exercised by August 2032 will automatically be exercised. No amount is payable on vesting
or exercise of deferred rights.
Upon exercise of rights that vest, participants are entitled to receive a dividend equivalent payment (DEP) in respect
of the period between 1 July 2021 (i.e. the start of the service period) and the date of exercise.
Performance conditions
and KPI weighting
Whitehaven has chosen performance conditions that link to our strategy and motivate outperformance of annual
business plans. The Board set target KPIs at the commencement of FY22.
The table below summarises the KPIs that were adopted as performance conditions in FY22, and the applicable
weighting of each performance condition:
KPI
Safety (TRIFR)
Scorecard Weighting
Safety (Level 4 & 5 Hazard Identification & Rectification)
Environmental Enforcements
Environment Critical Control Verification
Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA)
FOB cost per tonne (equity basis)
ROM production (managed basis)
Overburden (mbcm)
10%
10%
10%
10%
10%
25%
12.5%
12.5%
An individual performance overlay determines final KPI results, such that KMP may only achieve an STI award greater
than the formulaic scorecard outcome in cases of exceptionally strong performance relative to their individual
performance goals. Further, individual performance below expectations results in a reduction in STI award.
Assessment of individual KMP performance was completed by the Board and Remuneration Committee at the
conclusion of FY22.
Board Discretion
The Board maintains discretion to alter the formulaic outcomes outlined above if the results generate any unintended
outcomes when taking into account the perspectives of various stakeholders including but not limited to shareholders,
employees and communities.
3.4. FY22 LTI award structure
The key LTI structure and measures (specifically relative TSR, Costs and Strategic Priority Delivery) remain broadly
consistent with FY21. The only change, as described below, is intended to clarify some of the circumstances under which
the Board might recalibrate the LTI Costs hurdle.
Consistent with prior years, the Board has set the entry point as the first quartile of Wood Mackenzie data of Australian
industry outcomes for comparable mines as the target for LTI Costs Hurdle, allowing for the rail freight differential
between Whitehaven and our peers due to the location of Whitehaven mines. The Board may, where it is appropriate to
do so, recalibrate the LTI Costs Hurdle to take account of structural changes in the Company’s asset portfolio or other
circumstances that were not reasonably foreseeable at the time of grant. As approved at the 2021 Annual General
Meeting, for FY22 these circumstances might include a strategic decision taken to produce higher quality coal at higher
cost in order to increase financial returns for shareholders. The Board intends only to reward performance that is
consistent with shareholder expectations.
Page 35 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
This change does not alter the total reward opportunity for Executive KMPs but rather provides a more direct link
between strategy and remuneration outcomes.
The terms of the LTI grants made during FY22 to Executive KMP were as follows:
Feature
Description
LTI Opportunity
CEO: 120% of TFR
Other Executive KMP: 80% of TFR
Calculation of
LTI award
The value of LTI awards and the number of performance rights granted is calculated as follows:
Form of delivery,
vesting and exercise
LTI awards granted in FY22 were provided in the form of performance rights, being rights to receive one ordinary
share in the Company for each performance right that vests on meeting relevant performance conditions. Vested
deferred rights that have not been exercised by October 2031 will automatically be exercised. No amount is payable
on vesting or exercising of deferred rights.
Upon exercise of rights that vest, participants are entitled to receive a dividend equivalent payment (DEP) in respect
of the period between 1 July 2021 (i.e. the start of the service period) and the date of exercise.
Relative TSR Awards
Weighting = 35%
Performance Period: the Relative TSR awards are divided into two equal tranches capable of vesting and becoming
exercisable after three and four year performance periods respectively, beginning on 1 July 2021.
Conditions: the award is subject to a relative TSR performance hurdle (TSR Hurdle) which compares the TSR
performance of the Company with the TSR performance of companies operating in the S&P ASX100 index.
Vesting schedule:
Performance level
Outcome as a % of target opportunity
75th percentile or above
100% of the TSR Awards will vest
Between 50th and 75th
percentile
Vesting will occur on a pro rata straight line basis between 50% and 100%
At 50th percentile
50% of the TSR Awards will vest
Below 50th percentile
0% TSR Awards will vest
Reason chosen: this measure arguably allows for an objective external assessment of the shareholder value created
by the Company relative to other large organisations over a sustained period.
Costs Hurdle Awards
Weighting = 50%
Performance Period: FOB cost per tonne achieved for the year ended 30 June 2024 with the Costs Hurdle Awards
being tested at that time. Awards will be capable of vesting after the end of the performance period, with half of any
vested awards becoming exercisable immediately and half subject to deferral for a further year before becoming
exercisable.
Conditions: the award is subject to the Company achieving a cost per tonne target (Costs Hurdle Target) that will
position the company competitively on the then current cost curve. The Board has set the target as the first quartile of
Wood Mackenzie data of Australian industry outcomes for comparable mines (i.e. haul distance adjusted to account
for the northern location of Whitehaven’s mines, which results in additional rail costs for the organisation). A Costs
Hurdle gateway also applies to ensure that a base level of cost control is achieved before any of the award vests.
The Board intends only to reward performance that is consistent with shareholder expectations. The Board may,
where it is appropriate to do so, recalibrate the LTI Costs Hurdle to take account of structural changes in the
Company's asset portfolio or other circumstances that were not reasonably foreseeable at the time of grant, for
example a strategic decision taken to produce higher quality coal at higher cost in order to increase financial returns
for shareholders.
Vesting schedule:
Performance level
Outcome as a % of target opportunity
Target or lower
100% of the Costs Hurdle Awards will vest
Between target and gateway
Vesting will occur on a pro rata straight line basis between 50% and 100%
Gateway
50% of the Costs Hurdle Awards will vest
Above gateway
0% Costs Hurdle Awards will vest
Notwithstanding the vesting schedule above, the Board retains discretion to lapse any or all of the Costs Hurdle
Awards if the Board considers that vesting would be inappropriate in light of the intent and purpose of the target. Full
vesting will only occur if the Board is satisfied performance meets or exceeds the Costs Hurdle Target as set out
above. The Costs Hurdle Awards will lapse in full if the Costs Hurdle Gateway is not achieved.
Reason chosen: this measure is aligned to the Company’s objective to be positioned competitively against Australian
coal producers in relation to production costs when measured on the then current coal industry cost curve.
Competitive costs protect and preserve shareholder value in difficult times and support enhanced returns when the
commodity cycle recovers.
Performance Period: single tranche measured over a four-year performance period, capable of vesting following 30
June 2025.
Page 36 | Whitehaven Coal Annual Report 2022
Strategic Priority
Delivery Awards
Weighting = 15%
Directors’ Report Remuneration Report
For the year ended 30 June 2022
Conditions: the award is subject to Company achievement toward key strategic priorities, assessed by the Board. It is
also subject to an additional ‘gateway’ test, of positive TSR to ensure that an award is only considered after
shareholder value growth is achieved over the relevant performance period.
Vesting schedule: Subject to satisfaction of the performance gateway/underpin (i.e. achieving positive absolute TSR
between FY21 and FY25), following the end of the performance period the Board will assess achievement in the
delivery of, and progress towards, key strategic priorities and determine the outcome of the Strategic Priority Delivery
Rights. Due to the commercially sensitive nature of the strategic priorities, retrospective disclosure of the outcomes
against the performance levels will be provided in the Remuneration Report for the year of vesting.
Reason chosen: this measure is designed to align senior employees to the efficient and effective delivery of long-term
projects that directly impact shareholder value.
Retesting
Any component of the LTI award that does not vest following testing will lapse. There is no retesting of awards that
do not vest.
3.5. Policies and conditions of rights awarded under equity plans
Malus and Clawback
The Board has discretion to reduce or claw back all vested and unvested LTI and STI awards in certain circumstances if
subsequent events show a reduction to be appropriate. The circumstances in which the Board may exercise this
discretion include: where an Executive KMP engages in fraud, dishonesty or other misconduct; a material misstatement of
the Company’s financial statements or other material error which results in vesting; or any other factor that the Board
deems justifiable.
Dividend and voting rights
Rights carry no entitlement to voting or dividends prior to exercise. Upon exercise of vested rights, the recipient is
entitled to receive a dividend equivalent payment (DEP) in respect of any prior period between the start of the
performance period and exercise. Any DEP made to participants may be made in cash or provided as additional fully paid
ordinary shares in the Company, as determined by the Board.
Prohibition on hedging
Participants are required to comply with the Company’s securities trading policy in respect of their performance rights,
options and any shares they receive upon exercise.
They are prohibited from hedging or otherwise protecting the value of their performance rights and options.
Change of control
In the event of a takeover bid or other transaction, event or state of affairs that in the Board’s opinion is likely to result in
a change in control of the Company, the Board has discretion to determine that vesting of some or all of any unvested
performance awards should be accelerated.
Cessation of employment
Unless the Board determines otherwise, cessation of employment by:
Termination for cause: unvested performance awards will lapse.
Resignation or by mutual agreement with the Company: unvested performance awards will remain on foot and be
subject to the original performance hurdle. However, the Board may at its discretion determine to lapse any or all of
the unvested performance awards and ordinarily, in the case of a resignation, would be expected to do so.
Other circumstances: unvested performance awards will remain on foot and be subject to the original performance
hurdle, with Board discretion to determine that some of the performance awards (up to a pro rata portion based on
how much of the performance period remains) will lapse. The performance awards that remain on foot will be tested in
the normal course following the end of the relevant performance period.
Page 37 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
3.6. Benchmarking total remuneration
While benchmarking is a useful starting point, it is only one input the Board uses to determine total remuneration for
Executive KMP. Actual market positioning for each individual is an outcome of multiple factors such as internal relativities,
experience, tenure in role, individual performance and retention considerations.
Fixed and Total Remuneration are benchmarked against appropriate market comparator groups adopted by the Board.
As with many commodity-based organisations, Whitehaven’s share price (and consequently market capitalisation) is
highly dependent on the price of coal, therefore the Board now benchmarks remuneration against two primary
comparator groups. One is based on current company size (1/3 to 3x Whitehaven’s market capitalisation) plus a coal
industry premium, and another which reflects a more stable group of industry aligned comparators. Both comparator
groups consist of Australian listed companies, which have been identified as Whitehaven’s relevant competitors for
talent, operating in similar business environments.
In making remuneration decisions, having both benchmarking groups enables the Board to make decisions that balance
the market capitalisation challenges the business faces, addresses the difficulties of attracting top executives to
Whitehaven and the coal industry in light of evolving ESG-related concerns and seeks to retain our talented management
team.
Comparator groups used to benchmark FY23 fixed and total remuneration
Groups
1 - Comparable size and industry
This group had a median market
capitalisation of $4.5 billion
(as at the time of benchmarking).
Companies
Adbri Ltd
AGL Enegy Ltd
APA Group
Beach Energy
BlueScope Steel Ltd
Boral Ltd
Lynas Rare Earths Ltd
Mineral Resources Ltd
New Hope Corporation Ltd
Nufarm Ltd
Orica Ltd
Orora Ltd
Coronado Global Resources Inc.
OZ Minerals Ltd
2 – ASX200 Industrials
This group had a median market
capitalisation of $7.2 billion
(as at the time of benchmarking).
CSR Ltd
Evolution Mining
Iluka Resources Ltd
Incitec Pivot Ltd
Adbri Ltd
Alumia Ltd
Ampol Ltd
Beach Energy Ltd
BHP Group Ltd
BlueScope Steel Ltd
Sims Ltd
Viva Energy Group Ltd
Yancoal Australia Ltd
New Hope Corporation Ltd
Newcrest Mining Ltd
Northern Star Resources Ltd
Orica Ltd
Orora Ltd
OZ Minerals Ltd
Coronado Global Resources Inc.
Regis Resources Ltd
Evolution Mining Ltd
Fletcher Building Ltd
Fortescue Metals Group Ltd
IGO Ltd
Iluka Resources Ltd
Incitec Pivot Ltd
Rio Tinto Ltd
Santos Ltd
Sims Ltd
South32 Ltd
Washington H Soul Pattinson and Company Ltd
Worley Ltd
Mineral Resources Ltd
Yancoal Australia Ltd
Page 38 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
4. FY22 Remuneration Outcomes
4.1. Summary of Company performance
Company performance for the last five years
A snapshot of key Company statutory performance for the past five financial years is set out below:
Revenue ($m)
Statutory EBITDA ($m)1
Net profit/(loss) after tax ($m)1
Share price at year end (dollars per share)
Basic EPS (cents per share)
Diluted EPS (cents per share)
Shareholder dividends paid (cents per share)
Share buy-back ($m)
Total Reportable Injury Frequency Rate (TRIFR)4
Saleable production (Mt)
FY22
FY21
4,920.1
3,060.1
1,952.0
$4.84
197.6
195.1
8
362.6
5.4
17.3
1,557.0
204.5
(543.9)
$1.94
(54.6)
(54.6)
-
-
5.9
16.9
FY20
1,721.6
306.0
30.0
$1.43
3.0
3.0
31.5
-
4.1
18.4
FY19
FY18
2,487.9
1,001.2
527.9
$3.66
53.5
52.4
47
-
6.2
19.8
2,257.4
1,002.2
524.5
$5.782
53.1
52.1
333
-
6.9
20.9
1 Statutory EBITDA and net profit after tax for FY18 has been restated for the adoption of AASB 16 Leases.
2 The opening share price for 2018 was $2.87.
3
Includes capital return of 14 cents per share.
4 TRIFR is the total number of injuries resulting in lost time, restricted work duties or medical treatment per million hours worked.
4.2. FY22 Executive KMP STI outcomes
Before the start of each financial year, the Board sets target KPIs aligned to strategy that drive outperformance of annual
business plans. At financial year end, the CEO recommends to the Board the individual outcomes for each Executive
KMP, based on a combination of scorecard and individual outcomes. The Board then assesses and approves the overall
STI outcomes for the CEO and Executive KMP.
Scorecard targets and outcomes
Strong financial outcomes, underpinned by record EBITDA of $3.1 billion, and target and above target health, safety and
environment performance led to an overall 86% of maximum scorecard outcome.
The table below summarises results for each KPI, as well as the FY22 STI scorecard outcome, including details where the
Board has considered the interests of shareholders in determining outcomes that reflect the value created beyond the
KPI results. For instance, Target performance has been determined for the FY22 STI Outcome for FOB Unit Costs, as
management’s successful execution of a high-quality coal strategy delivered substantial value for shareholders,
contributing significantly to the record EBITDA. This strategy however, resulted in higher costs than anticipated, for
which the Board made allowance when determining the final outcome. Similarly, the STI outcomes for ROM Production
and Overburden were determined at Target outcomes following consideration of COVID-related labour constraints, wet
weather events in late 2021 which disrupted production schedules, and consistent with broader mining industry,
Whitehaven faced escalating diesel, demurrage, and costs of explosives. As outlined in the relevant sections below, in
these instances, the Board recognised and made allowance for the reasonably unforeseeable circumstances that
management encountered during FY22.
Page 39 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
KPI Unit
Weighting
FY22
Result
Gateway
(50%)
Target
(100%)
Stretch
(125%)
FY22 STI Outcome
(% of max)
FY22 Targets and Results
HEALTH, SAFETY AND ENVIRONMENT
TRIFR
(TRIF rate)
10%
5.4
5.9
Leading Safety Indicator – Hazard
Reporting
(Potential Level 4 & 5 hazards reported
and actions completed)
10%
336
66
Environment Compliance
10%
4
5
(Enforceable Actions)
Environment Critical Controls Verified
10%
94%
85%
(% completion)
5.6
132
4
4
90%
5.3
93.3%
5.4
198
100%
336
3
80%
100%
88%
94%
Safety remains our first and foremost priority across sites, and following continued investment and focus, TRIFR continued to improve, reducing
from 5.9 to 5.4 in FY21 and FY22 respectively. This outcome continues to track below comparable industry performance. Additionally, our leaders
are actively identifying and rectifying Level 4 and Level 5 safety hazards, as demonstrated by the stretch outcome for this metric. This
commitment to pro-active and pre-emptive safety measures helps ensure our workforce continually strives towards our Zero Harm goal.
Similarly, as a result of continued attention and commitment, environmental performance improved this year with the number of environmental
enforcement actions continuing to trend downward, to 4 in FY22, leading to a Target outcome. The Board also took into account the nature and
severity of these events when reviewing the Target outcome (2x Penalty Notices, 1x Prevention Notice, 1x Pending Outcome). The pending
outcome is expected to be resolved in FY23 and the Board will continue to monitor this event. Each of these events were investigated with
corrective actions implemented to prevent reoccurrence.
When assessing management’s performance across the Environment Compliance measure, the Board considered the impact of legacy incidents,
specifically those for which proceedings were resolved in FY22 (i.e. events which occurred in FY20 and FY19). It was determined that in each
case, the incident was appropriately factored into remuneration outcomes at the time of the incident. Similarly, the Board reviewed environmental
incidents from prior years that were subsequently withdrawn by the relevant authority or where no further action was taken, and confirmed a
recasting of prior years’ STI outcomes would not be appropriate.
A high level of critical controls being verified (CCVs) also occurred during the year, resulting in an outcome between Target and Stretch. The CCV
process involves site-specific risk assessments to identify critical controls, the development of performance standards to assess the critical
controls, and the verification of the effectiveness of controls using the performance standard. The Board continues to place strong emphasis on
compliance and minimising environmental incidents.
KPI Unit
FINANCIALS
EBITDA
(A$m)
FOB Unit Cost
(A$/tonne)
Weighting
FY22
Result
Gateway
(50%)
Target
(100%)
Stretch
(125%)
FY22 STI Outcome
(% of max)
FY22 Targets and Results
10% $3,060
$650
$720
$850
100%
25%
$84
$76
$74
$3,060
$72
80%
$84
The FY22 record EBITDA of $3.1 billion, up from $0.2 billion in FY21, reflects exceptionally strong coal prices throughout most of the financial year,
coupled with solid operational performance. This strong result was supported by a record average achieved coal price of $325/t, up from $95/t in
the prior year (before applicable royalties).
Group costs were at the upper end of the revised cost guidance, which increased to $79/t - $84/t in January 2022, from the original $72/t - $76/t
guidance. Costs were impacted by higher than anticipated diesel prices, labour costs and increased demurrage costs as a result of weather
impacts at the Port of Newcastle and coal supply disruptions. Further, as pricing spreads continued to increase between high-quality and low-
quality markets, additional costs were incurred as the Company increased washing in order to increase the availability of high-CV coal. The
premiums associated with this high-CV coal contributed an estimated $1.0 billion to the final EBITDA result.
Recognising that the high-quality coal strategy, which has delivered significant value to shareholders, also contributed to higher than anticipated
costs, the Board determined to use an adjusted FOB Unit Cost outcome, aligned to Target performance. This has been done to ensure STI
outcomes reflect management’s ability to successfully execute the strategy and capitalise on price dynamics to generate the best outcomes for
shareholders.
Page 40 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
KPI Unit
OPERATIONS
ROM Production
(Mt)
Overburden
(Mbcm)
Weighting
FY22
Result
Gateway
(50%)
Target
(100%)
Stretch
(125%)
FY22 STI Outcome
(% of max)
FY22 Targets and Results
12.5%
20.0
20.0
21.5
22.0
80%
20.0
12.5%
95.2
103.4
114.8
120.6
80%
Despite challenging operational circumstances such as high COVID-related absenteeism and significant wet weather events in the Gunnedah
basin in H1 which resulted in mine site access flooding, improved operational performance led to FY22 ROM Production of 20.0Mt, which was
within our original market guidance range.
The Board, taking into account these constraints, determined to use outcomes aligned to Target performance, for both ROM Production and
Overburden to ensure STI outcomes reflect management’s FY22 performance.
95.2
Individual STI outcomes
Executive KMP outcomes for FY22 are set out in the table below, which take into account a combination of the Group-
wide scorecard metrics detailed above, and individual KMP performance. The Board considered the performance of each
KMP against their respective strategic and operational priorities as agreed at the commencement of the financial year.
Recognising the successful delivery against these priorities, notably the exceptional execution of the Company’s value-
creating strategy to produce coal at a quality level higher than originally budgeted, all three Executive KMP were
assessed as ‘Exceeding Expectations’ by the Board. This resulted in an uplift from 86% to 96% of maximum opportunity.
Executive KMP
Paul Flynn
Kevin Ball
Ian Humphris
Paid as
cash
($)
936,300
305,850
294,000
Deferred
equity
($)
936,300
305,850
294,000
Total
($)
1,872,600
611,700
588,000
Percentage of
maximum STI received
Percentage of
maximum STI forfeited
96%
96%
96%
4%
4%
4%
The total STI opportunity at target and stretch, by Executive KMP, as a percentage of TFR is detailed in section 3.3.
4.3. FY22 Executive KMP LTI vesting outcomes
The table below sets out the LTI awards capable of vesting in 2022 and the results of the respective performance
condition testing.
Award type
TSR Award
TSR Award
Costs Hurdle
Award1
LTI
year
2018
2019
2019
Performance
period
1 July 2018 –
30 June 2022
1 July 2019 –
30 June 2022
1 January 2021 –
31 December 2021
Tranche
2 of 2
1 of 2
1 of 1
Target
Performance achieved
Vesting outcome2
75th percentile or
above
75th percentile or
above
75th percentile or
above
35th Percentile
(TSR of 5.8%)
68th Percentile
(TSR of 47.7%)
75th Percentile
0%
86.8%
100%
1 50% of vested 2019 Costs Rights become exercisable following the end of the testing period, while the remaining 50% of vested Costs Rights are subject to a further
one-year service condition to 30 June 2023.
2 The remaining proportion of each award due to vest in FY22 was forfeited.
The TSR Award outcomes are compiled and reported by independent consultants Guerdon Associates, while the Cost
Hurdle Award is compiled and reported by independent consultants Wood Mackenzie. Prior to testing, work was
undertaken with Wood Mackenzie to ensure the model used was an appropriate representation and comparison of
Whitehaven cost outcomes. Specifically, comparable mines with similar ash content were referenced to ensure like for
like comparisons. Further, as noted in the table above, comparisons were made on a calendar basis, as industry data is
Page 41 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
calculated and presented on this basis by Wood Mackenzie. It is therefore not feasible for Whitehaven Coal to compare
financial year costs to industry data, in this or subsequent years.
Additional information about the terms of these prior year LTI awards is available in the Remuneration Report for the
relevant financial years.
Executive KMP LTI awards vesting in FY22
Executive
KMP
Paul Flynn
Kevin Ball
Ian Humphris
2018
TSR Hurdle
(Tranche 2)
2019
TSR Hurdle
(Tranche 1)
2019
Costs
Hurdle
Performance Rights
LTI value
$
-
-
-
108,021
33,607
-
248,780
1,726,933
77,398
537,269
-
-
Vested LTI
at face value
of award1
Vested LTI
share price
appreciation1
$
1,316,596
409,609
-
$
410,336
127,661
-
Award Test Date
30 June 2022
30 June 2022
30 June 2022
VWAP – Face value
VWAP - Award Test Date
$5.70
$4.84
$3.69
$4.84
$3.69
$4.84
4.4. LTI awards granted in FY22
A summary of the LTI awards granted in FY22 (i.e. the face value and the fair value of the LTI granted to each
Executive KMP) is set out in the table below:
Executive KMP
Paul Flynn
Kevin Ball
Ian Humphris
Number of
performance rights
granted1
Face value of
performance rights grant2
Fair value of performance
rights at grant date3
955,409
297,245
285,715
($)
1,872,600
582,600
560,000
($)
2,029,289
631,348
606,859
1 Refer to section 3.4 for the terms of the LTI grant.
2 The face value of the LTI performance rights of $1.96 was calculated using the volume weighted average price of Whitehaven shares over the 20 trading day period
commencing 10 trading days prior to 30 June 2021.
3 The fair value for awards granted to the Executive KMP is based on the average fair value of $2.12 per performance right as at 26 November 2021, being the grant
date. The factors and assumptions used in determining the fair value are set out in note 5.5 to the financial statements.
4 The issue of these securities was done in accordance with the approval of the Company’s shareholders under ASX Listing Rule 10.14 at the Company’s 2021 Annual
General Meeting
Page 42 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
4.5. Summary of Executive KMP total realised remuneration outcomes
The Board and Remuneration Committee are of the view that the Company and the Executive KMP have continued to
successfully execute the Group’s long-term strategy and in FY22 have realised exceptional benefits for stakeholders,
including shareholders, employees and the communities in which we operate. This information differs to that provided in
the statutory remuneration table in section 8.1 and may be helpful to shareholders as it provides a summary of the actual
Executive KMP remuneration outcomes in FY22. It includes:
fixed remuneration earned in FY22
STI earned in respect of FY22 performance (including the cash component payable in September 2022 and the
deferred component awarded in equity, which may vest and become exercisable in later years)
LTI that vested in FY22, including the impact of share price growth between the grant date and the vesting date
any non-monetary benefits provided to Executive KMP in FY22 (including fringe benefits).
For further details on STI and LTI outcomes for FY22 refer to sections 4.2 and 4.3 respectively.
Name
FY
TFR1
STI2
cash
Total
cash
Deferred
equity
STI 3
LTI4
vested
at face
value of
award Other5
Total
remuneration
Vested LTI6
share price
growth
Total including
share price growth
Paul
Flynn
Kevin
Ball
Ian
Humphris
2022
1,560,500
936,300
2,496,800
936,300
1,316,596
12,900
4,762,596
410,336
2021
1,530,000
509,490
2,039,490
509,490
-
12,900
2,561,880
-
2022
728,250
305,850
1,034,100
305,850
409,609
8,600
1,758,159
127,661
2021
714,000
166,434
880,434
166,433
2022
700,000
294,000
994,000
294,000
2021
650,000
163,637
813,637
163,635
-
-
-
-
1,046,867
12,900
1,300,900
12,900
990,172
-
-
-
5,172,933
2,561,880
1,885,819
1,046,867
1,300,900
990,172
1 Total fixed remuneration (TFR) comprises base salary and superannuation.
2 STI represents the amount of cash STI that each Executive KMP will be paid in September of the relevant year, based on annual performance. Refer to sections 3.3
and section 4.2 for further details.
3 Deferred equity STI refers to the amount of STI deferred into rights that are subject to further service conditions. The Deferred FY22 STI is expected to be issued at
a volume weighted average price (VWAP) of $4.84. It is expected that rights issued under the STI will vest and become exercisable in two equal tranches following
the completion of FY23 and FY24. Refer to section 3.3 for further details.
4 LTI vested represents LTI awards made in 2018 and 2019 (FY21: 2017 and 2018) for which the test period ended during the financial year and which have vested. The
amounts shown are the face value of the awards at grant. Refer to section 4.2 for further details.
5 Other includes parking, motor vehicle benefits and other similar items. Kevin Ball has been eligible for a parking benefit from 1 November 2021.
6 LTI share price growth is the amount of the LTI award delivered by an increase between the face value VWAP used for the award that was granted and the VWAP
of a share at the award test date for those awards which vested. LTI outcomes are explained further in section 4.2 of this report.
Page 43 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
5. Changes to the Remuneration Framework from FY23
During FY22, the Board undertook a comprehensive review of Whitehaven’s executive remuneration framework which,
with the support of the Godfrey Remuneration Group, aimed to ensure that the framework:
is fit for purpose, recognising the attraction and retention challenges of the coal industry;
aligns executive remuneration outcomes with the experience of shareholders; and
supports the execution of the Company’s evolving strategy.
Following this review, the Board determined that it was in the best interests of the Company and its stakeholders to
target the 75th percentile from a fixed remuneration perspective and adopt a Single Incentive Plan (SIP), to replace the
previous Short-term and Long-term Incentive Plans. These changes, which are set out below, took effect at the beginning
of FY23 and will be implemented in line with similar incentive schemes in the market.
5.1. Fixed Remuneration
Executives will receive a component of their remuneration in the form of fixed remuneration, which is a combination of
cash and superannuation contributions.
As described in section 3.6, the Board now references two comparator groups and targets the 75th percentile of each
group, while adding a coal industry premium to the primary peer group. As the graphic below illustrates, KMP fixed
remuneration is now positioned slightly below the 75th percentile of both comparator groups.
Fixed remuneration benchmarking
5.2. New Single Incentive Plan
The incentive structure has been designed to align executive remuneration outcomes with measures that support a range
of stakeholder interests, including the interests of our shareholders, our workforce and the communities in which we
operate. Its substantial equity component ensures executives are aligned strongly with shareholder experiences.
Feature
Description
Annual Performance
Period
Each annual performance period begins and ends with the financial year (i.e. 1 July to 30 June)
SIP Opportunity
CEO: target 185% of TFR and stretch 277.5% of TFR
Other Executive KMP: target 125% of TFR and stretch 187.5% of TFR
Calculation of SIP award The value of SIP awards will be calculated as follows.
Page 44 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
Scorecard KPIs and
weightings
The scorecard KPIs represent 80% of the overall SIP outcome.
Whitehaven has chosen outcome-focused performance conditions that link to our strategy. Executives will no longer
be assessed against leading indicator KPIs such as Safety Hazard Identification and Environment Critical Control
Verification. While these leading indicators are important in creating a positive safety culture, and remain a feature in
the site incentive plans, it is recognised following feedback from shareholders that outcomes are more relevant when
assessing executive performance.
The table below summarises the KPIs and the applicable weighting of each performance measure that have been
adopted in FY23:
KPI
Weighting
Health, Safety and Environment Measures (40%)
Safety (TRIFR)
Environmental Enforcement (EEAFR)
Financial Measures (40%)
Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA)
FOB cost per tonne (equity basis)
Production Measures (20%)
ROM production (managed basis)
20%
20%
25%
15%
20%
The measures and weightings outlined above will be considered by the Board at the beginning of each financial year,
with changes expected as strategy evolves. For example, the EBITDA and FOB Cost weightings could be rebalanced
to reflect timing in the coal price cycle (i.e. higher cost weighting in low price years when managing costs is
increasingly critical).
Individual Performance
Assessment
The remaining 20% of the overall SIP outcome reflects each executive’s individual performance, as assessed relative to
achievement of the individual goals and objectives set at the beginning of the financial year. These quantitative and
qualitative objectives reflect both short- and longer-term strategic initiatives, as well how executives demonstrate
behaviours aligned to Whitehaven’s STRIVE values. Performance against objectives is assessed annually as part of the
Company’s broader performance review process.
Form of delivery,
vesting and exercise
Following the conclusion of each annual performance period, any resulting SIP award will be delivered to executives in a
combination of cash, deferred rights and performance rights, as follows:
- 30% cash, expected to be paid in September following the end of the financial year;
- 36% Deferred Rights, which vest in equal tranches annually over 3 years, subject to service conditions; and
- 34% Performance Rights, divided equally into two tranches which are subject to performance conditions over a
four-year period commencing at grant
Refer to graphic on the following page.
Performance Rights
Relative Quality Cost Measure (50% weighting): These Rights are subject to the Company maintaining Whitehaven’s
competitive position in the Australian industry for comparable mines (i.e. haulage cost and quality adjusted). Target
position will be defined by the Board at the time of grant.
Given Wood Mackenzie curves are produced on a calendar year basis, the cost measure will be tested based on the
average costs achieved on a Company-wide basis over the most recent calendar year prior to vesting. This ensures like for
like comparisons to the Wood Mackenzie cost curve.
Strategic Priority Delivery Measure (50% weighting): These Rights are subject to Company achievement toward delivery
of Strategic Priorities. Performance Rights linked to the Strategic Priority Delivery Measure are intended to align executives
to the efficient and effective delivery of long-term projects that directly impact shareholder value creation. Progress
towards strategic priorities will be assessed by the Board at the end of the 4-year performance period, and will include
projects such as Vickery Extension, Winchester South and Narrabri Stage 3.
When determining the underlying measures for these Performance Rights, the Board considered a number of alternatives
including various accounting measures, as well as retaining the existing relative TSR measure. Accounting measures were
deemed inappropriate given price taking companies, like Whitehaven, do not have meaningful impact over measures such
as Return on Equity (ROE), earnings per share (EPS) or Return on Invested Capital (ROIC). Relative TSR was deemed to be
inappropriate given the influence of ESG concerns on the Whitehaven share price, as a significant proportion of investors
are unwilling or unable to invest in coal stocks resulting in significant valuation discounts and a disconnect of the
traditional coal price to share price relationship. Further, the cyclicality of a commodity business, coupled with the limited
number of comparable ASX-listed pure coal producers makes relative performance comparisons problematic.
Retesting
Any component of the SIP award that does not vest following testing will lapse. There is no retesting of awards that do not
vest.
Board Discretion
The Board maintains discretion to alter the formulaic outcomes outlined above if the results generate any unintended
outcomes when taking into account the perspectives of various stakeholders including but not limited to shareholders,
employees and communities.
Page 45 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
Timing of remuneration delivery
To ensure executives are aligned appropriately to shareholder experience and to support executive retention, the vesting
schedule has been lengthened relative to previous frameworks and is broadly consistent with other SIPs in the market.
The diagram below illustrates the timing for determining and delivering Executive KMP under the SIP:
5.3. New Minimum Shareholding Requirements
Prior to FY23, Whitehaven Coal did not have a minimum shareholding policy in place for executives or Non-Executive
Directors. Although there is no legislative requirement to maintain such a policy, the Remuneration Committee considers
it appropriate to encourage KMP to hold a reasonable number of WHC shares with a view to aligning further the interests
of executives with those of shareholders. In addition to the changes outlined above, a Minimum Shareholding
Requirement (MSR) has been introduced from July 2022. As outlined in the table below, Non-Executive Directors and
Executive KMP are now subject to the requirements, and have 3 years and 5 years respectively to comply.
Role
Non-Executive Directors
Managing Director & Chief Executive Officer
Other Executive KMP
Requirement
1 year of fees
100% of TFR
50% of TFR
Time to comply
3 years
5 years
5 years
Given the potential share price volatility of a commodity-based company, an historical 5-year average share price will be
used to assess minimum shareholding compliance each year. KMP are expected to demonstrate meaningful progress
towards meeting their minimum shareholding level across the required period. From FY23, this progress will be reported
in conjunction with the current disclosure of actual shares held by each KMP.
Page 46 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
6. Executive KMP employment contracts
This section sets out an overview of key terms of employment for the Executive KMP, as provided in their service
agreements.
All Executive KMP contracts give the Company discretion to make payment in lieu of notice. No notice is required where
termination is for cause. The contracts do not provide for any termination payments other than payment in lieu of notice.
Treatment of unvested incentives is dealt with in accordance with the terms of grant. In general, under the STI and LTI
arrangements, and the new SIP, unvested entitlements will be forfeited where an executive is terminated for cause or, at
the Board’s discretion, where they resign. In all other circumstances where the Board considers the executive to be a
‘good leaver’, outgoing executives will generally retain their entitlements (subject to any applicable performance
conditions in the case of LTI arrangements).
Managing Director and CEO
Paul Flynn was appointed as Managing Director and CEO of the Company on 25 March 2013. This table outlines the key
terms of Mr Flynn’s contract of employment:
Fixed remuneration
Mr Flynn’s annual TFR for FY23 is $1,888,000 (FY22: $1,560,500). It includes salary, superannuation
contributions, any components under Whitehaven’s salary packaging guidelines and all Director fees. TFR is
reviewed annually.
Single Incentive Plan
As outlined in section 5, Mr Flynn is eligible to participate in the new SIP. At target performance, his FY23 SIP
opportunity is 185% of TFR, with up to 277.5% of TFR for stretch performance.
Other key terms
Other key terms of Mr Flynn’s service agreement include the following:
His employment is ongoing, subject to 12 months’ notice of termination by Whitehaven or 6 months’ notice of
termination by Mr Flynn.
The Company may terminate without notice in certain circumstances, including serious misconduct or
negligence in the performance of duties. Mr Flynn may terminate immediately in the case of fundamental
changes to his role (that is, there is a substantial diminution in his responsibilities), in which case his
entitlements will be the same as if the Company terminated him without cause.
The consequences for unvested incentive awards on termination of Mr Flynn’s employment will be in
accordance with the equity incentive plans.
Mr Flynn will have post-employment restraints for a period of 3 months. No additional amounts will be
payable in respect of this restraint period.
Other Executive KMP contracts
A summary of the notice periods and key terms of the current Executive KMP contracts is set out in the table below. All
of the contracts below are of ongoing duration.
Name and position (at year-end)
Notice
Kevin Ball
Chief Financial Officer
Appointed 16 December 2013
Ian Humphris
Executive General Manager – Operations
Appointed 6 April 2020
3 months by employee
6 months by the Company
6 months by employee or the Company
Page 47 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
7. Non-Executive Director remuneration
This section explains the fees paid to Non-Executive Directors during FY22 and approved fees for FY23.
7.1. Non-Executive Director fees
Non-Executive Director fees are designed to ensure that the Company can attract and retain suitably qualified and
experienced Non-Executive Directors.
Non-Executive Directors do not receive shares or any performance-related incentives as part of their fees from the
Company. Historically there has not been a formal minimum shareholding requirement, however Non-Executive Directors
have always been encouraged to hold shares. As outlined in Section 5, Non-Executive Directors are now subject to
minimum shareholding requirements.
Non-Executive Directors are also reimbursed for travel and other expenses reasonably incurred when attending meetings
of the Board or in connection with the business of the Company.
The Remuneration Committee reviews and makes recommendations to the Board with respect to Non-Executive Director
fees and Committee fees.
In 2012 shareholders approved a total aggregate maximum amount of Non-Executive Director fees of $2,500,000 per
annum. No change is being sought to the total aggregate Non-Executive Director fees pool for FY23.
7.2. FY22 and FY23 Board and Committee Fees
The table below sets out Board and Committee fees for FY22 and FY23.
There had been no changes to Non-Executive Director fees since 1 July 2017; however, following a market benchmarking
exercise supported by independent consultants Godfrey Remuneration Group, it was determined that increases to Board
fees were required in order to remain competitive with comparable organisations. The increased fees for FY23 are
outlined below, noting Committee fees remain unchanged.
Chairman
FY22
Deputy
Chairman
Member
Chairman
FY23
Deputy
Chairman
Member
Board
$375,0001
$262,5001
$140,000
$450,0001
$315,0001
$180,000
Audit & Risk Management Committee
Remuneration Committee
Governance & Nominations Committee
Health, Safety, Environment & Community
Committee
$40,000 1
$40,000 1
No fee1
$40,000 1
$20,000
$40,000 1
$20,000
$40,000 1
No fee
No fee1
$20,000
$40,000 1
$20,000
$20,000
No fee
$20,000
1 The Chairman and Deputy Chairman of the Board do not receive committee member fees in addition to their Board fees.
The fees set out above exclude mandatory statutory superannuation contributions made on behalf of the Non-Executive
Directors.
Page 48 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
7.3. FY22 Non-Executive Director remuneration
The statutory disclosures required under the Corporations Act 2001 (Cth) and in accordance with the Accounting
Standards are set out in the table below:
Non-Executive
Directors
Mark Vaile
(Chairman)
John Conde
(Deputy Chairman)
Dr Julie Beeby
Fiona Robertson
Lindsay Ward
Raymond Zage
Total
FY
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
2022
2021
Short-term
benefits, $
Post-employment
benefits, $
Board and
Committee fees
Non-monetary
benefits
Other long-term
benefits
(non-cash)
Superannuation
benefits
Total fees for
services as
a Non-Executive
Director1
375,000
375,000
262,500
262,500
180,000
180,000
200,000
200,000
180,000
180,000
140,000
140,000
1,337,500
1,337,500
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
23,568
21,694
23,568
21,694
18,000
17,100
20,000
19,000
18,000
17,100
-
-
103,136
96,588
398,568
396,694
286,068
284,194
198,000
197,100
220,000
219,000
198,000
197,100
140,000
140,000
1,440,636
1,434,088
1 No termination benefits or share-based payments are paid or are payable to Non-Executive Directors.
Page 49 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
8. Executive KMP statutory tables and additional disclosures
8.1. Executive KMP statutory remuneration table
The following table sets out the statutory remuneration disclosures required under the Corporations Act 2001 (Cth) and
has been prepared in accordance with the appropriate accounting standards:
Short-term
benefits, $
Post-employment
benefits, $
Share based
payments, $
Salary
& fees
Non-
monetary
benefits
Year
Cash STI
Superannuation
benefits
Termination
benefits
Total
remuneration
Performance
related
LTI
(C)
STI
(B)
(A)
(B)
Executive Directors
Paul Flynn
2022
1,533,000
12,900
936,300
2021
1,505,000
12,900
509,490
Other Executive KMP
Kevin Ball
2022
703,250
8,600
305,850
2021
689,000
-
166,434
Ian Humphris 2022
672,500
12,900
294,000
2021
625,000
12,900
163,637
Total
2022
2,908,750
34,400
1,536,150
2021
2,819,000
25,800
839,561
27,500
25,000
25,000
25,000
27,500
25,000
80,000
75,000
-
-
-
-
-
-
-
-
1,401,410 593,442
4,504,552
965,864
434,251
3,452,505
435,997
193,457
1,672,154
304,214
138,682
1,323,330
292,835
170,189
1,469,924
103,514
65,471
995,522
2,130,242 957,088
7,646,630
1,373,592
638,405
5,771,357
%
65%
55%
56%
46%
52%
33%
(A) The amounts disclosed as non-monetary benefits relate to car spaces, motor vehicle benefits and other similar items.
(B) Comprises the cash component of current year STI (refer to sections 3.3 and 4.1 for details) and the fair value at each grant date of STI deferred rights expensed
over the relevant period for the service vesting condition (which is included in the share based payments column of the table)s. The fair value of STI grants is based
on the volume weighted average price of Whitehaven shares over the 20 trading day period commencing 10 trading days prior to 30 June of each respective grant.
(C) The fair value for LTI performance rights granted to KMP is based on the fair value at each grant date expensed over the vesting period. The factors and
assumptions used in determining the fair value are set out in note 5.5 to the financial statements.
Page 50 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
8.2. Movement in options and rights held by Executive KMP
The movement during the reporting period by number and value of equity instruments in the Company held by each
Executive KMP is detailed below:
Executive
KMP
Instrument
Balance
as at
1 July 2021
(number)
Granted
(number)
Granted
($)
Vested/
awarded
during the
year
(number)
Exercised
(number)
Exercised
($)
Lapsed
(number)
(A)
(B)
(C)
Lapsed
(year of
grant)
(D)
Balance as
at
30 June
2022
(number)
Vested and
exercisable
at 30 June
2022
Paul
Flynn
Performance
Rights (LTI)
2,072,672
955,409
2,029,289
-
-
-
296,164
2017/2018
2,731,917
Kevin
Ball
Options
(LTI)
Deferred
Rights (STI)
Performance
Rights (LTI)
Options
(LTI)
Deferred
Rights (STI)
489,031
-
-
-
292,444
456,213
196,587
2018
-
256,809
259,944
509,490
169,309
169,309
435,750
-
-
347,444
647,851
297,245
631,348
-
-
-
95,159
2017/2018
849,937
177,025
-
-
-
105,862
165,145
71,163
2018
-
81,816
84,915
166,433
53,233
53,233
134,673
Ian
Humphris
Performance
Rights (LTI)
Deferred
Rights (STI)
419,730
285,715
606,859
-
12,229
83,488
163,636
6,115
-
-
-
-
-
-
-
-
113,498
-
705,445
-
95,717
6,115
(E)
-
-
-
-
-
-
-
(A) The number of rights granted during FY22 includes:
(a) the FY22 LTI awards (further details are provided in section 3.4).
(b) the deferred rights component of the FY21 STI award, calculated by reference to the VWAP of the Company’s shares for the 20 day trading period commencing
10 trading days prior to 30 June 2021. The granting of rights occurred on 26 November 2021.
(B) The value of LTI performance rights granted in the year is the fair value of the performance rights at grant date.
The value of deferred STI rights granted in the year has been calculated using the volume weighted average price of the Company’s shares for the 20 day trading
period commencing 10 trading days prior to 30 June 2021 as fair value, being $1.96 per share.
Unvested LTI and STI awards have a minimum value of zero if they do not meet the relevant performance or service conditions.
The maximum value of unvested LTI and STI awards is the sale price of the Company’s shares at the date of vesting, or where applicable, on exercise (plus the value
of any dividend equivalent payment attaching to the award on vesting or, where applicable, on exercise).
(C) The 2017 LTI TSR Hurdle Tranche 2 Rights, the 2018 LTI Costs Target Hurdle and the 2018 LTI TSR Hurdle Tranche 1 Rights fully lapsed during the year due to the
performance conditions not being met.
Tranche 1 of the FY20 STI and Tranche 2 of the FY19 STI deferred rights vested during the period. The value at exercise has been calculated using the volume
weighted average price of the Company’s shares for the 20 day trading period commencing 10 trading days prior to 1 July 2020 and 1 July 2019 respectively.
(D) The year in which the lapsed performance rights, options or deferred rights were granted.
(E) No vested equity instruments were unexercisable as at 30 June 2022.
Page 51 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
8.3. Movement in ordinary shares held by KMP
The movement during the reporting period in the number of ordinary shares in the Company held directly, indirectly or
beneficially by Executive KMP and each Non-Executive Director, including their related parties, is as follows:
Held at
1 July 2021
Received on vesting and
exercise of STI/LTI
Number of shares
Non-Executive Directors
Mark Vaile
John Conde
Dr Julie Beeby
Fiona Robertson
Lindsay Ward
Raymond Zage
Executive KMP
Paul Flynn
Kevin Ball
Ian Humphris
1,509,317
708,620
85,000
75,395
77,500
10,583,134
1,630,607
440,565
19,695
(A)
-
-
-
-
-
-
Other net
change
(B)
-
-
-
-
-
Held at
30 June 2022
(C)
1,509,317
708,620
85,000
75,395
77,500
200,000
10,783,134
339,844
161,525
-
-
(400,000)
-
1,970,451
202,090
19,695
(A) No shares were granted as remuneration during FY22 (other than shares allocated on exercise of vested awards).
(B) Includes shares sold and purchased during FY22.
(C) No shares were held nominally at the end of FY22.
8.4. Related party transactions and additional disclosures
Loans with Executive KMP and Non-Executive Directors
There were no loans outstanding to Executive KMP or any Non-Executive Director or their related parties at any time in
the current or prior reporting periods.
Other KMP Transactions
Apart from the details disclosed in this report, no Executive KMP or Non-Executive Director or their related parties has
entered into a material contract with the consolidated entity since the end of the previous financial year and there were
no material contracts involving those people’s interests existing at year end.
Signed in accordance with a resolution of the Directors:
The Hon. Mark Vaile AO
Chairman
Paul Flynn
Managing Director
Sydney
25th August 2022
Page 52 | Whitehaven Coal Annual Report 2022
Directors’ Report Remuneration Report
For the year ended 30 June 2022
Financial Report
For the year ended 30 June 2022
Page 53 | Whitehaven Coal Annual Report 2022
Table of Contents
Directors’ Report Remuneration Report
For the year ended 30 June 2022
Consolidated financial statements
Consolidated statement of comprehensive income
Consolidated statement of financial position
Consolidated statement of changes in equity
Consolidated statement of cash flows
Notes to the consolidated financial statements
Directors’ declaration
Independent Auditor’s report
55
56
57
58
59
101
102
1. About this report
5. Capital structure and financing
1.1. Reporting entity
1.2. Basis of preparation
1.3. Significant accounting judgements,
estimates and assumptions
1.4. Summary of other significant accounting
policies
1.5. New standards, interpretations and
amendments adopted by the Group
2. Group performance
2.1. Segment reporting
2.2. Significant items
2.3. Taxes
2.4. Earnings per share
3. Working capital and cash flows
3.1. Trade and other receivables
3.2. Inventories
3.3. Trade and other payables
3.4. Reconciliation of cash flows from operating
activities
4. Resource assets and liabilities
4.1. Property, plant and equipment
4.2. Exploration and evaluation
4.3. Intangible assets
4.4. Provisions
5.1.
Interest-bearing liabilities
5.2. Finance income and expense
5.3. Financial risk management objectives and
policies
5.4. Share capital and reserves
5.5. Share-based payments
6. Group structure
6.1. Group’s subsidiaries
6.2. Interest in joint operations
6.3. Parent entity information
6.4. Deed of cross guarantee
6.5. Related parties
7. Other notes
7.1. Employee benefits
7.2. Auditor’s Remuneration
7.3. Commitments
7.4. Contingencies
7.5. Subsequent events
Page 54 | Whitehaven Coal Annual Report 2022
Consolidated statement
Notes to the consolidated financial statements
For the year ended 30 June 2022
of comprehensive income
For the year ended 30 June 2022
Revenue
Other income
Operating expenses
Coal purchases
Selling and distribution expenses
Royalties
Depreciation and amortisation
Impairment losses
Administrative expenses
Share-based payments expense
Foreign exchange gain/(loss)
Profit/(loss) before net financial expense
Finance income
Finance expense
Net finance expense
Profit/(loss) before tax
Income tax (expense)/benefit
Net profit/(loss) for the year
Other comprehensive income
Items that may be reclassified subsequently to profit or loss
Net movement on cash flow hedges
Income tax effect
Other comprehensive loss for the period, net of tax
Note
2.1
2022
$’000
2021
$’000
4,920,102
1,556,976
7,136
6,836
(764,331)
(700,433)
(308,049)
(173,683)
(377,395)
(330,924)
(368,778)
(108,789)
(238,881)
(260,662)
2.2
-
(650,000)
5.5(a)
(46,886)
(34,228)
(9,234)
7,570
(6,995)
(4,279)
2,821,254
(706,181)
1,464
228
(56,825)
(62,242)
5.2
(55,361)
(62,014)
2,765,893
(768,195)
2.3(a)
(813,928)
224,281
1,951,965
(543,914)
5.2
2.3(b)
5.2
(88)
26
(62)
(15,146)
4,544
(10,602)
Total comprehensive income/(loss) for the period, net of tax
1,951,903
(554,516)
Earnings per share
Basic earnings/(loss) per share (cents per share)
Diluted earnings/(loss) per share (cents per share)
2.4
2.4
197.6
195.1
(54.6)
(54.6)
The consolidated statement of comprehensive income is to be read in conjunction with the notes to the consolidated
financial statements.
Page 55 | Whitehaven Coal Annual Report 2022
Consolidated statement
Notes to the consolidated financial statements
For the year ended 30 June 2022
of financial position
As at 30 June 2022
Assets
Cash and cash equivalents
Trade and other receivables
Inventories
Derivatives
Total current assets
Trade and other receivables
Investments
Property, plant and equipment
Exploration and evaluation assets
Intangible assets
Derivatives
Total non-current assets
Total assets
Liabilities
Trade and other payables
Interest-bearing liabilities
Employee benefits
Income tax payable
Provisions
Derivatives
Total current liabilities
Non-current liabilities
Other payables
Interest-bearing liabilities
Deferred tax liability
Provisions
Derivatives
Total non-current liabilities
Total liabilities
Net assets
Equity
Issued capital
Share-based payments reserve
Hedge reserve
Retained earnings
Total equity
Note
3.1
3.2
5.3(d)
3.1
5.3(d)
4.1
4.2
4.3
5.3(d)
3.3
5.1
7.1
2.3(c)
4.4
5.3(d)
3.3
5.1
2.3(c)
4.4
5.3(d)
2022
$’000
1,215,460
657,459
157,039
31
2021
$’000
95,202
154,163
175,930
-
2,029,989
425,295
7,298
856
11,785
37
3,426,847
3,330,413
647,289
12,180
74
613,508
11,828
-
4,094,544
3,967,571
6,124,533
4,392,866
361,897
77,843
33,987
551,830
16,461
7,774
231,268
75,116
31,926
-
18,423
3,485
1,049,792
360,218
48,464
166,854
405,169
242,516
104
46,269
917,597
155,055
203,789
4,200
863,107
1,326,910
1,912,899
1,687,128
4,211,634
2,705,738
5.4(a)
2,642,338
3,013,661
14,867
(5,441)
12,213
(5,379)
1,559,870
(314,757)
4,211,634
2,705,738
The consolidated statement of financial position is to be read in conjunction with the notes to the consolidated
financial statements.
Page 56 | Whitehaven Coal Annual Report 2022
Consolidated statement
Notes to the consolidated financial statements
For the year ended 30 June 2022
of changes in equity
For the year ended 30 June 2022
Balance at 1 July 2020
Loss for the period
Other comprehensive loss
Total comprehensive loss for the year
Issued
capital
Share-based
payment
reserve
Hedge
reserve
Retained
earnings
Total equity
$’000
$’000
$’000
$’000
$’000
Note
5.4(b)
5.4(b)
3,003,964
15,253
5,223
225,150
3,249,590
-
-
-
-
-
-
-
(543,914)
(543,914)
(10,602)
-
(10,602)
(10,602)
(543,914)
(554,516)
Transactions with owners in their capacity as owners
Share-based payments
5.5(a)
-
6,995
Share issues/transfers to settle share-based payments
11,034
(7,470)
Cash settled share-based payments
Transfer on lapse of share-based payments
-
-
Purchase of shares through employee share plan
5.4(a)
(1,337)
(836)
(1,729)
-
-
-
-
-
-
-
1,959
319
1,729
6,995
5,523
(517)
-
-
(1,337)
Closing balance at 30 June 2021
3,013,661
12,213
(5,379)
(314,757)
2,705,738
Balance at 1 July 2021
Profit for the period
Other comprehensive loss
Total comprehensive income for the year
Transactions with owners in their capacity as owners
Share buy-back
Dividends paid
Share-based payments
5.5(a)
Share issues/transfers to settle share-based payments
Transfer on lapse of share-based payments
3,013,661
12,213
(5,379)
(314,757)
2,705,738
-
-
-
5.4(a)
(362,568)
-
-
4,124
-
-
-
-
-
-
9,234
(4,337)
(2,243)
-
1,951,965
1,951,965
(62)
(62)
-
(62)
1,951,965
1,951,903
-
-
-
-
-
-
-
(362,568)
(79,794)
(79,794)
-
213
2,243
9,234
-
-
-
(12,879)
Purchase of shares through employee share plan
5.4(a)
(12,879)
-
Closing balance at 30 June 2022
2,642,338
14,867
(5,441)
1,559,870
4,211,634
The consolidated statement of changes in equity is to be read in conjunction with the notes to the consolidated
financial statements.
Page 57 | Whitehaven Coal Annual Report 2022
Consolidated statement
Notes to the consolidated financial statements
For the year ended 30 June 2022
of cash flows
For the year ended 30 June 2022
Cash flows from operating activities
Cash receipts from customers
Cash paid to suppliers and employees
Cash generated from operations
Interest paid
Interest received
Income taxes (paid)/refunded
Net cash from operating activities
Cash flows from investing activities
Proceeds from sale of property, plant and equipment
Purchase of property, plant and equipment
Expenditure on projects
Acquisition of subsidiary and private royalty1
Net cash used in investing activities
Cash flows from financing activities
Payment of finance facility upfront costs
Purchase of shares
Proceeds from senior bank facility
Repayment of senior bank facility
Repayment of secured loans – ECA facility
Repayment of lease principal
Share buy-back2
Payment of dividends
Note
2022
$’000
2021
$’000
4,385,223
1,541,762
(1,803,269)
(1,372,274)
2,581,954
(41,637)
1,464
(11,958)
169,488
(43,136)
228
12,185
3.4
2,529,823
138,765
3,860
(124,210)
(33,781)
(23,064)
3,499
(68,693)
(22,165)
(16,232)
(177,195)
(103,591)
(6,248)
(12,879)
40,000
(2,538)
(1,337)
110,000
(728,000)
(60,000)
(9,795)
(76,673)
(358,981)
(79,794)
(10,119)
(82,738)
-
-
Net cash used in financing activities
(1,232,370)
(46,732)
Net change in cash and cash equivalents
Cash and cash equivalents at 1 July
Cash and cash equivalents at 30 June
1,120,258
95,202
1,215,460
(11,558)
106,760
95,202
1 On 14th October 2021, the Company entered into an agreement to acquire the 1% private royalty over the Narrabri Coal mine held by Anglo Pacific Group plc (APG)
with effect from 31 December 2021. The acquisition consideration is comprised of three components to be paid in instalments over five years. An amount of USD $4.4
million was paid on 31 December 2021 upon completion of the agreement.
2 A share trade entered into on 30 June 2022 for $3,588,000 was settled and paid on 4 July 2022 bringing total share buy-backs for the year to $362.5 million.
The consolidated statement of cash flows is to be read in conjunction with the notes to the consolidated
financial statements.
Page 58 | Whitehaven Coal Annual Report 2022
Notes to the consolidated
Notes to the consolidated financial statements
For the year ended 30 June 2022
financial statements
For the year ended 30 June 2022
1. About this report
1.1. Reporting entity
Whitehaven Coal Limited (‘Whitehaven’ or ‘the Company’) is a for-profit entity, and the principal activity of Whitehaven
and its controlled entities (referred to as ‘the Group’) is the development and operation of coal mines in New South
Wales and Queensland. The consolidated general purpose financial report of the Group for the year ended 30 June 2022
was authorised for issue in accordance with a resolution of the Directors on 25 August 2022. Whitehaven Coal Limited is
a company limited by shares incorporated and domiciled in Australia whose shares are publicly traded on the Australian
Securities Exchange. The address of the Company’s registered office is Level 28, 259 George Street, Sydney NSW 2000.
1.2. Basis of preparation
The financial report is a general purpose financial report, which has been prepared in accordance with the requirements
of the Corporations Act 2001 (Cth), Australian Accounting Standards (AAS) and other authoritative pronouncements of
the Australian Accounting Standards Board (AASB). The financial report also complies with International Financial
Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB) and interpretations of the
International Financial Reporting Interpretations Committee (IFRIC).
The financial report has been prepared on a historical cost basis, except for derivative financial instruments that have
been measured at fair value (refer to note 5.3).
The Company is of a kind referred to in ASIC Corporations Instrument 2016/191 and dated 24 March 2016. In accordance
with that Class Order, all financial information has been presented in Australian dollars and rounded to the nearest
thousand dollars unless otherwise stated.
1.3. Significant accounting judgements, estimates and assumptions
In the process of applying the Group’s accounting policies, management has made a number of judgements and applied
estimates of future events that form the basis of the carrying values of assets and liabilities, which are not readily
apparent from other sources.
Judgements and estimates that are material to the financial report are found in the following notes:
2.3
4.1
4.2
4.4
6.2
Taxes
Property, plant and equipment
Exploration and evaluation
Provisions
Interest in joint operations
page 67
page 76
page 77
page 79
page 95
1.4. Summary of other significant accounting policies
The accounting policies set out below and in the notes have been applied consistently to all periods presented in these
consolidated financial statements, and have been applied consistently by all subsidiaries in the Group. Other significant
accounting policies are contained in the notes to the consolidated financial statements to which they relate.
(i) Basis of consolidation
The consolidated financial report of the Company for the financial year ended 30 June 2022 comprises the
Company and its controlled entities (together referred to as ‘the Group’). A list of the Group’s significant controlled
entities is presented in Note 6.1.
Control is achieved when the Group is exposed, or has rights, to variable returns from its involvement with the
investee and has the ability to affect those returns through its power over the investee. The Group reassesses
whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of
the three elements of control. Specifically, the Group controls an investee if, and only if, the Group has all of
the following:
power over the investee (i.e. existing rights that give it the current ability to direct the relevant activities of the
investee)
exposure, or rights, to variable returns from its involvement with the investee
the ability to use its power over the investee to affect its returns.
Page 59 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
Assets, liabilities, income and expenses of a subsidiary acquired or disposed of during the year are included in the
consolidated financial statements from the date the Group gains control until the date the Group ceases to control
the subsidiary.
(ii) Foreign currency translation
Transactions in foreign currencies are initially recorded in the functional currency by applying the exchange rates
ruling at the date of the transaction. Monetary assets and liabilities denominated in foreign currencies are
retranslated at the rate of exchange ruling at the balance date. Foreign exchange differences arising on translation
are recognised in the consolidated statement of profit or loss and other comprehensive income.
Both the functional and presentation currency of the Company and all entities in the Group is Australian dollars ($).
(iii) Goods and services tax
Revenues, expenses and assets (excluding receivables) are recognised net of the amount of goods and services tax
(GST), except where the amount of GST incurred is not recoverable from the taxation authority. In these
circumstances, the GST is recognised as part of the cost of acquisition of the asset or as part of the expense.
Receivables and payables are stated with the amount of GST included. The net amount of GST recoverable from, or
payable to, the ATO is included as a current asset or liability in the consolidated statement of financial position.
Cash flows are included in the consolidated statement of cash flows on a gross basis and the GST components of
cash flows arising from investing and financing activities, which are recoverable from or payable to the ATO, are
classified as operating cash flows.
(iv) Notes to the consolidated financial statements
The notes to these consolidated financial statements have been organised into logical groupings to present more
meaningful and dynamic information to users. To the extent possible, the relevant accounting policies and numbers
have been provided in the same note. The Group has also reviewed the notes for materiality and relevance, and
provided additional information where considered material and relevant to the operations, financial position or
performance of the Group.
1.5. New standards, interpretations and amendments adopted by the Group
(i) Changes in accounting policy and disclosures
The accounting policies adopted in the preparation of the consolidated financial statements are consistent with
those of the previous financial year.
Several amendments apply for the first time in the current year. However, they do not impact the annual
consolidated financial statements of the Group.
(ii) Accounting standards and interpretations issued but not yet effective
Australian Accounting Standards and Interpretations that have recently been issued or amended but are not yet
effective and have not been adopted by the Group for the annual reporting period ended 30 June 2022 are outlined
below:
Amendments to IAS 1: Classification of Liabilities as Current or Non-current
In January 2020, the IASB issued amendments to IAS 1 Presentation of Financial Statements to clarify the
requirements for classifying liabilities as current or non-current. Specifically:
- The amendments specify that the conditions which exist at the end of the reporting period are those which will
be used to determine if a right to defer settlement of a liability exists.
- Management intention or expectation does not affect classification of liabilities.
-
In cases where an instrument with a conversion option is classified as a liability, the transfer of equity
instruments would constitute settlement of the liability for the purpose of classifying it as current or non-
current.
These amendments are effective for annual periods beginning on or after 1 January 2024. They are not expected to
have a significant impact on the Group’s consolidated financial statements.
Amendments to IAS 1 and IFRS Practice Statement 2 – Disclosure of Accounting Policies
In February 2021, the IASB issued amendments to IAS 1 and IFRS Practice Statement 2 Making Materiality
Judgements (the PS), in which it provides guidance and examples to help entities apply materiality judgements to
accounting policy disclosures.
Page 60 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
The amendments aim to help entities provide accounting policy disclosures that are more useful by:
-
-
replacing the requirement for entities to disclose their ‘significant’ accounting policies with a requirement to
disclose their ‘material’ accounting policies
adding guidance on how entities apply the concept of materiality in making decisions about accounting policy
disclosures.
These amendments are effective for annual periods beginning on or after 1 January 2023. They are not expected to
have a significant impact on the Group’s consolidated financial statements.
Amendments to IAS 8 – Definition of Accounting Estimates
In February 2021, the IASB issued amendments to IAS 8, in which it introduced a new definition of ‘accounting
estimates’. The amendments clarify the distinction between changes in accounting estimates and changes in
accounting policies and the correction of errors. Also, they clarify how entities use measurement techniques and
inputs to develop accounting estimates.
These amendments are effective for annual periods beginning on or after 1 January 2023. They are not expected to
have a significant impact on the Group’s consolidated financial statements.
Amendments to IAS 12 – Deferred Tax related to Assets and Liabilities arising from a Single Transaction
In May 2021, the IASB issued amendments to IAS 12, which narrow the scope of the initial recognition exception
under IAS 12, so that it no longer applies to transactions that give rise to equal taxable and deductible temporary
differences.
Under the amendments, the initial recognition exception does not apply to transactions that, on initial recognition,
give rise to equal taxable and deductible temporary differences. It only applies if the recognition of an asset and a
liability resulting from a transaction gives rise to taxable and deductible temporary differences that are not equal.
These amendments are effective for annual periods beginning on or after 1 January 2023. They are not expected to
have a significant impact on the Group’s consolidated financial statements.
2. Group performance
2.1. Segment reporting
Identification of reportable segments
The Group identifies its operating segments based on the internal reports that are reviewed and used by the executive
management team in assessing performance and determining the allocation of resources. The performance of operating
segments is evaluated at least monthly based on revenues and profit before taxes and is measured in accordance with
the Group’s accounting policies.
The Group has determined that it has three reportable segments: open cut operations, underground operations and coal
trading and blending. Coal trading and blending segment has been added in FY22 to capture the performance of 3rd
party coal purchases and sales as well as the benefits the Group enjoys from blending different coal qualities from our
mines in such a way that the final sale price achieved for the blended coal is greater. The prior comparative period has
been restated to effect this change in segments.
Unallocated operations represent the development projects and those functions that are not specifically related to the
other reportable segments.
The Group’s treasury and financing (including finance costs and finance income), and depreciation and income taxes are
managed on a group basis and are not allocated to reportable segments.
The following table represents revenue, profit and capital expenditure information for reportable segments:
Page 61 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
Year ended 30 June 2022
Revenue
Sales to external customers
Revenue by product type:
Metallurgical coal
Thermal coal
Open Cut
Operations
Underground
Operations
Coal Trading
and Blending
Unallocated
Operations
Total
$’000
$’000
$’000
$’000
$’000
3,443,772
953,810
492,083
30,437
4,920,102
724,507
121,446
99,261
-
945,214
2,719,265
832,364
392,822
30,437
3,974,888
Total revenue from contracts with customers
3,443,772
953,810
492,083
30,437
4,920,102
Result
Segment EBITDA result
Depreciation and amortisation
Income tax expense
Net finance expense
Net profit after tax per consolidated statement
of comprehensive income
Capital expenditure
Segment expenditure
Year ended 30 June 2021
Revenue
Sales to external customers
Revenue by product type:
Metallurgical coal
Thermal coal
Total revenue from contracts with customers
Result
Segment EBITDA result
Impairment losses
Depreciation and amortisation
Income tax benefit
Net finance expense
Net loss after tax per consolidated statement
of comprehensive income
Capital expenditure
Segment expenditure
2,240,273
617,446
184,034
18,382
3,060,135
(238,881)
(813,928)
(55,361)
1,951,965
63,267
57,775
-
36,949
157,991
Open Cut
Operations
Underground
Operations
Coal Trading
and Blending
Unallocated
Operations
Total
$’000
$’000
$’000
$’000
$’000
1,107,187
263,101
189,506
(2,818)
1,556,976
208,821
898,366
1,107,187
35,457
-
-
244,278
227,644
189,506
(2,818)
1,312,698
263,101
189,506
(2,818)
1,556,976
250,410
(48,657)
15,823
(13,095)
204,481
(650,000)
(260,662)
224,281
(62,014)
(543,914)
43,418
21,967
-
25,473
90,858
Page 62 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
Other segment information
Revenue from external customers is attributed to geographic location based on final shipping destination.
Revenue by
geographic location
Japan
Taiwan
Korea
India
Indonesia
Malaysia
Europe
New Caledonia
Vietnam
Philippines
Thailand
Other
Domestic
2022
$’000
2,570,531
706,948
540,430
437,593
216,719
168,657
96,784
66,857
64,275
18,193
12,704
7,929
12,482
2021
$’000
691,455
201,886
295,988
151,421
24,472
73,870
-
25,796
22,939
10,980
26,335
20,258
11,576
Total revenue
4,920,102
1,556,976
Page 63 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
Major customers
The Group has three major customers, who account for 43.4% (2021: 40.5%) of external revenue.
Recognition and measurement
The Group recognises sales revenue related to the transfer of promised goods or services when control of the goods
or services is transferred to the customer. The amount of revenue recognised reflects the consideration to which the
Group is or expects to be entitled to in exchange for those goods or services.
Sales revenue is recognised on individual sales when control transfers to the customer. The title, risks and rewards,
and fulfilment of performance obligation occurs when the product is loaded onto the vessel for delivery to the
customer.
The Group sells its products on Free on Board terms where the Group has no responsibility for freight or insurance
once control of the goods has passed at the loading port. Under these terms there is only one performance
obligation: the provision of goods at the point when control passes to the customer.
The Group’s products are sold to customers under contracts that vary in tenure and pricing mechanisms, primarily
being monthly or quarterly indexes. Certain sales may be provisionally priced at the date revenue is recognised;
however, substantially all coal sales are reflected at final prices by the end of the reporting period. The final selling
price is based on the price for the quotational period stipulated in the contract.
2.2. Significant items
The items below are significant to understanding the overall results of the Group. The Company believes the disclosure of
these items provides readers of the financial statements with further meaningful insights to understand the financial
performance of the Group.
Included within the balances presented on the face of
the consolidated statement of comprehensive income:
Impairment losses
Property, Plant and Equipment
Intangibles
Significant items before tax
Applicable income tax benefit
Significant items after tax
Note
2022
$’000
2021
$’000
4.1
4.3
-
-
-
-
-
638,882
11,118
650,000
(193,399)
456,601
Significant items are items of income and expense, which, due to their nature and variable financial impact or the
expected infrequency of the events giving rise to them, are separated for internal reporting, and analysis of Whitehaven’s
results to aid in providing an understanding and comparative basis of the underlying financial performance. In FY21,
Whitehaven recognised significant expenses totalling $650 million. The significant expenses relate to asset impairments.
For further details see notes 4.1 and 4.3. The FY21 impairment charge was allocated to the following:
Narrabri ($548.7 million) due to the reduction in the JORC Coal Reserves on the current Narrabri Mining Lease, arising
out of an optimisation plan which has been developed to focus on the production of higher quality coal over the
balance of mine life
Werris Creek ($90.2 million) due to revisions to its mine plan and uncertainties for this market segment after the
adoption of conservative price assumptions considering the uncertainties in coal markets
Rail intangible ($11.1 million) relates to rail rights which are no longer expected to be utilised.
Page 64 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
2.3. Taxes
a)
Income tax expense
Current tax (expense)/benefit
Current period
Adjustments for prior periods
Deferred tax expense
Origination and reversal of temporary differences
Recognition of tax losses
Adjustments for prior periods
2022
$’000
2021
$’000
(742,653)
21
68,478
(1,040)
(92,339)
157,061
21,771
(728)
-
(218)
Income tax (expense)/benefit reported in the consolidated statement of comprehensive income
(813,928)
224,281
Reconciliation between tax expense and profit before tax
Profit/(loss) before tax
2,765,893
(768,195)
Income tax (expense)/benefit using the Company’s domestic tax rate of 30% (2021: 30%)
(829,768)
230,459
Non-deductible expenses:
Share-based payments
Other non-deductible expenses
Recognition of tax losses
On-market share purchases by employee share scheme trust reimbursed by the Group
Over/(under) provided in prior periods
Total income tax (expense)/benefit
b)
Income tax recognised directly in other comprehensive income
Deferred income tax related to items charged directly to equity
Derivatives
Income tax benefit recorded in equity
(2,770)
(7,109)
21,771
3,927
(2,098)
(2,822)
-
-
21
(1,258)
(813,928)
224,281
2022
$’000
26
26
2021
$’000
4,544
4,544
Page 65 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
c) Recognised tax assets and liabilities
2022
2022
2021
2021
Current income
tax payable
Deferred
income tax
Current income
tax payable
Deferred
income tax
$’000
(384,920)
157,061
4,544
68,478
-
(218)
-
Opening balance
Charged to income – corporate tax
Charged to equity
$’000
-
(742,653)
-
$’000
(155,055)
(92,339)
26
$’000
13,225
68,478
-
(Utilisation)/recognition of deferred tax asset on current year
losses
178,865
(178,865)
(68,478)
Recognition of tax losses
Adjustment for prior periods
Payments/(refunds)
Closing balance
-
-
11,958
21,771
(707)
-
-
(1,040)
(12,185)
(551,830)
(405,169)
-
(155,055)
Deferred income tax assets and liabilities are attributable to the following:
Property, plant and equipment
Exploration and evaluation
Receivables
Inventory
Investments
Right-of-use assets and lease liabilities (net)
Deferred stripping
Deferred foreign exchange gain
Provisions
Tax losses
Other items
Tax assets/(liabilities)
Set-off of tax (liabilities)/assets
Net tax liabilities
Assets
2022
$’000
-
-
-
-
359
-
-
-
86,178
27,589
584
114,710
(114,710)
-
2021
$’000
-
-
-
-
359
-
-
3,872
74,564
180,976
-
259,771
(259,771)
Liabilities
2022
$’000
(417,868)
(82,200)
(3,433)
(1,394)
-
(6,088)
(6,509)
(2,387)
-
-
-
2021
$’000
(328,752)
(68,027)
(5,225)
(1,390)
-
(6,357)
(1,676)
-
-
-
(3,399)
(519,879)
(414,826)
114,710
259,771
-
(405,169)
(155,055)
Page 66 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
d) Unrecognised deferred tax assets
There were no unrecognised income tax losses at 30 June 2022 (2021: $21,771,000).
Recognition and measurement
Income tax on the profit or loss for the year comprises
current and deferred tax. Income tax relating to items
recognised directly in other comprehensive income is
recognised in other comprehensive income and not in
the net profit or loss for the year.
Offsetting deferred tax balances
Deferred tax assets and liabilities are offset only if a
legally enforceable right exists, and the deferred tax
assets and liabilities relate to income taxes levied by the
same taxation authority on the same taxable entity.
Current tax
Current tax assets and liabilities are measured at the
amount expected to be recovered or paid to the
taxation authorities based on the taxable income for the
year, using tax rates enacted or substantively enacted at
the balance date.
Deferred tax
The deferred tax expense is the movement in the
temporary differences between the carrying amount of
an asset or liability in the consolidated statement of
financial position and its tax base.
Deferred tax liabilities are recognised for all taxable
temporary differences. Deferred tax assets, including
unused tax losses, are recognised in relation to
deductible temporary differences and carried forward
income tax losses only to the extent that it is probable
sufficient future taxable profits will be available to utilise
them. Deferred tax assets and liabilities are not
recognised for taxable temporary differences that arise
from goodwill or from the initial recognition (other than
in a business combination) of assets and liabilities in a
transaction that affects neither accounting profit nor the
taxable profit.
The carrying amount of deferred tax assets is reviewed
at each reporting date and reduced to the extent that it
is no longer probable that sufficient taxable profit will be
available to allow all or part of the deferred tax asset to
be utilised.
Deferred tax assets and liabilities are measured at the
tax rates that are expected to apply in the period in
which the liability is settled or the asset is realised,
based on tax rates and laws that have been enacted or
substantively enacted at the balance date.
Tax consolidation
Whitehaven Coal Limited and its wholly owned
Australian resident subsidiaries formed a tax
consolidated group with effect from 29 May 2007 and
have therefore been taxed as a single entity from that
date. Whitehaven Coal Limited is the head entity of the
tax consolidated group. The entities within the tax
consolidated group have entered into a tax sharing
arrangement which provides for the allocation of income
tax liabilities between the entities should the head entity
default on its tax payment obligations.
The entities within the tax consolidated group have also
entered into a tax funding agreement. The Group has
applied the Group allocation approach in determining
the appropriate amount of current taxes and deferred
taxes to allocate to its members. Under the terms of the
tax-funding arrangement, Whitehaven Coal Limited and
each of the entities in the tax consolidated group have
agreed to pay (or receive) a tax equivalent payment to
(or from) the head entity, based on the current tax
liability or current tax asset of the entity.
Whitehaven Coal Limited and the subsidiaries in the tax
consolidated group continue to account for their own
current and deferred tax amounts. The amounts are
measured as if each entity in the tax consolidated group
continues to be a standalone taxpayer in its own right.
The current tax balances are then transferred to
Whitehaven Coal Limited via intercompany balances.
Significant accounting judgements, estimates and assumptions
Deferred tax assets, including those arising from unrecouped tax losses, capital losses and temporary differences, are
recognised only where it is considered probable that they will be recovered, which is dependent on the generation of
sufficient future taxable profits.
Assumptions about the generation of future taxable profits depend on management’s estimates of future cash flows.
These rely on estimates of future production and sales volumes, operating costs, rehabilitation costs, capital
expenditure, dividends and other capital management transactions. Judgements are also required about the
application of income tax legislation. These judgements and assumptions are subject to risk and uncertainty, hence
there is a possibility that changes in circumstances will alter expectations, which may impact the amount of deferred
tax assets and liabilities recognised on the consolidated statement of financial position. Other tax losses and
temporary differences not yet recognised may also require adjustment, resulting in a corresponding credit or charge
to the consolidated statement of comprehensive income.
Page 67 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
2.4. Earnings per share
Basic earnings per share
The calculation of basic earnings per share is based on the profit attributable to ordinary shareholders and a weighted
average number of ordinary shares outstanding during the year calculated as follows:
2022
$’000
2021
$’000
Profit attributable to ordinary shareholders
Net profit/(loss) attributable to ordinary shareholders ($‘000)
1,951,965
(543,914)
Weighted average number of ordinary shares
Issued ordinary shares at 1 July (000s)
Effect of shares issued/(acquired) during the year (000s)
Weighted average number of ordinary shares at 30 June (000s)
998,624
(10,820)
987,804
992,026
4,519
996,545
Basic earnings/(loss) per share attributable to ordinary shareholders (cents)
197.6
(54.6)
Diluted earnings per share
Diluted earnings per share is based on the profit attributable to ordinary shareholders and a weighted average number of
ordinary shares outstanding adjusted for the diluting impact of potential equity instruments, calculated as follows:
2022
$’000
2021
$’000
Profit attributable to ordinary shareholders (diluted)
Net profit/(loss) attributable to ordinary shareholders (diluted) ($’000)
1,951,965
(543,914)
Weighted average number of ordinary shares (diluted)
Weighted average number of ordinary shares (basic) (000s)
Effect of performance rights on issue (000s)
Weighted average number of ordinary shares (diluted) (000s)
987,804
12,603
996,545
-1
1,000,407
996,545
Diluted earnings/(loss) per share attributable to ordinary shareholders (cents)
195.1
(54.6)
1
In FY21, the potential ordinary shares are anti-dilutive and therefore diluted earnings per share has not been calculated.
Not included within the basic and diluted earnings per share calculation are the 34,020,000 milestone shares which are
restricted from receiving dividend payments.
Page 68 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
3. Working capital and cash flows
3.1. Trade and other receivables
Current
Trade receivables
Other receivables and prepayments
Receivables due from other investors in joint operations
Non-current
Other receivables and prepayments
Recognition and measurement
2022
$’000
600,700
28,549
28,210
657,459
2021
$’000
95,715
39,476
18,972
154,163
7,298
11,785
Trade receivables, which generally have between 5 and 21 day terms, are recognised initially at fair value and
subsequently measured at amortised cost using the effective interest method, less any allowance for impairment.
Recoverability of trade receivables is reviewed on an ongoing basis.
3.2. Inventories
Coal stocks1
Consumables and stores
1 Coal stocks include run-of-mine and product coal.
Recognition and measurement
2022
$’000
119,282
37,757
2021
$’000
138,071
37,859
157,039
175,930
Inventories are measured at the lower of cost and net realisable value. Net realisable value is the estimated selling
price in the ordinary course of business, less the estimated costs of completion and selling expenses.
The cost of coal inventories is determined using a weighted average basis. Cost includes direct material, overburden
removal, mining, processing, labour, mine rehabilitation costs incurred in the extraction process and other fixed and
variable overhead costs directly related to mining activities. Stockpiles are measured by estimating the number of
tonnes added and removed from the stockpile. The tonnes of contained coal are based on assay data, and the
estimated recovery percentage is based on the expected processing method. Stockpile tonnages are verified by
periodic surveys.
Page 69 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
3.3. Trade and other payables
Current
Trade payables
Other payables and accruals
Non-current
Other payables
2022
$’000
59,948
301,949
361,897
2021
$’000
78,808
152,460
231,268
48,464
46,269
Included within current and non-current other payables and accruals is the deferred consideration payable for the
acquisition of EDF Trading Australia Pty Limited and the deferred consideration for the acquisition of the 1% private
royalty over the Narrabri Coal mine from Anglo Pacific Group plc (APG).
Recognition and measurement
Trade and other payables are initially recognised at fair value and subsequently measured at amortised cost when
goods and services are received, whether or not billed to the Group, prior to the end of the reporting period. Short-
term trade and other payables are not discounted. The amounts are unsecured and are usually paid within 30 days of
recognition. Long-term trade and other payables are discounted to their present value based on expected future
cash flows. The unwinding effect of discounting trade and other payables is recorded as a finance cost in the
consolidated statement of comprehensive income.
Page 70 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
3.4. Reconciliation of cash flows from operating activities
Profit/(loss) for the period
Adjustments for:
Depreciation and amortisation
Impairment losses
Amortisation of deferred development costs
Development costs deferred
Amortisation of finance facility upfront costs
Non-cash interest expense accruals
Foreign exchange (gains)/losses unrealised
Unwinding of discounts on provisions
Share-based compensation payments
Cash-settled share-based payments
Gain on sale of non-current assets
Subtotal
Change in trade and other receivables
Change in inventories and deferred stripping
Change in trade and other payables
Change in provisions and employee benefits
Change in tax payable
Change in deferred taxes
Cash flows from operating activities
Recognition and measurement
Note
2.2
4.1
4.1
4.4
5.5(a)
2022
$’000
2021
$’000
1,951,965
(543,914)
238,881
-
10,953
(101,605)
16,458
(5,448)
(17,281)
4,178
9,234
-
(1,905)
2,105,430
(498,811)
(4,641)
133,331
(7,430)
551,830
250,114
2,529,823
260,662
650,000
56,615
(94,578)
14,495
1,341
5,316
3,269
6,995
(517)
(3,680)
356,004
(26,414)
(422)
38,955
(17,263)
12,967
(225,062)
138,765
Cash and cash equivalents comprise cash at bank and in hand and short-term deposits. For the purpose of the
consolidated statement of cash flows, cash and cash equivalents are equal to the balance disclosed in the
consolidated statement of financial position.
Page 71 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
4. Resource assets and liabilities
4.1. Property, plant and equipment
Year ended
30 June 2022
Cost
Balance at
1 July 2021
Additions
Purchase of
Narrabri private
royalty1
Freehold
land
Plant and
equipment
Leased
plant and
equipment
Mining
property and
development
Subtotal
Deferred
development
Deferred
stripping
Subtotal
Total
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
178,801
1,087,916
610,668
3,178,746
5,056,131
561,935
2,888,397
3,450,332
8,506,463
5,661
52,153
60,584
72,999
191,397
101,605
447,153
548,758
740,155
-
-
-
36,565
36,565
-
-
-
-
-
-
36,565
(55,436)
Disposals
(2,138)
(4,037)
(48,955)
(306)
(55,436)
Balance at
30 June 2022
182,324
1,136,032
622,297
3,288,004
5,228,657
663,540
3,335,550
3,999,090
9,227,747
Accumulated depreciation and impairment
Balance at
1 July 2021
Depreciation
charge for the year
Disposals
Balance at
30 June 2022
Carrying amount
at 30 June 2022
(5,335)
(444,313)
(332,172)
(992,996)
(1,774,816)
(518,424)
(2,882,810) (3,401,234) (5,176,050)
-
-
(60,566)
(96,142)
(74,755)
(231,463)
(10,953)
(431,040)
(441,993)
(673,456)
4,037
44,263
306
48,606
-
-
-
48,606
(5,335) (500,842)
(384,051)
(1,067,445) (1,957,673)
(529,377)
(3,313,850) (3,843,227) (5,800,900)
176,989
635,190
238,246
2,220,559
3,270,984
134,163
21,700
155,863
3,426,847
1 On 14th October 2021, the Company entered into an agreement to acquire the 1% private royalty over the Narrabri Coal mine held by Anglo Pacific Group plc (APG)
with effect from 31 December 2021. Upon acquisition, the Group recognised an asset of $36.6 million representing the consideration payable. This will unwind over the
life of the Narrabri mine.
Page 72 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
Year ended
30 June 2021
Cost
Balance at
1 July 2020
Additions
Transfers
Disposals
Balance at
30 June 2021
Freehold
land
Plant and
equipment
Leased
plant and
equipment
Mining
property and
development
Subtotal
Deferred
development
Deferred
stripping
Subtotal
Total
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
$’000
144,078
1,088,567
614,939
3,224,657
5,072,241
467,357 2,496,740
2,964,097
8,036,338
9,688
21,873
33,917
11,105
76,583
94,578
391,657
486,235
562,818
25,035
-
-
(25,035)
-
-
(22,524)
(38,188)
(31,981)
(92,693)
-
-
-
-
-
-
-
(92,693)
178,801
1,087,916
610,668
3,178,746
5,056,131
561,935 2,888,397
3,450,332
8,506,463
Accumulated depreciation and impairment
Balance at
1 July 2020
Depreciation
charge for the year
Impairment
Disposals
Balance at
30 June 2021
Carrying amount
at 30 June 2021
-
(412,581)
(253,572)
(608,080)
(1,274,233)
(169,116) (2,437,995)
(2,607,111)
(3,881,344)
-
(54,224)
(109,132)
(96,272)
(259,628)
(56,615)
(392,605)
(449,220)
(708,848)
(5,335)
-
-
(288,644)
(293,979)
(292,693)
(52,210)
(344,903)
(638,882)
-
22,492
30,532
-
53,024
-
-
-
53,024
(5,335)
(444,313)
(332,172)
(992,996)
(1,774,816)
(518,424) (2,882,810) (3,401,234) (5,176,050)
173,466
643,603
278,496
2,185,750
3,281,315
43,511
5,587
49,098
3,330,413
Impairment
Year-ended 30 June 2022
Based on the impairment analysis performed at 30 June 2022, no impairment loss was recognised.
Where there is an indicator that previously recognised impairment losses may no longer exist or may have decreased, the
asset is tested for impairment. The impairment loss is reversed if there has been a change in the estimates used to
determine the recoverable amount of the asset and is reversed only to the extent that the carrying amount of the asset
does not exceed the carrying amount that would have been determined, net of depreciation and amortisation, had no
impairment loss been recognised. As the FY21 impairment was recognised on the basis of a reduction in JORC reserves at
Narrabri and revisions to mine conditions at Werris Creek, no impairment reversal was recognised in FY22.
Refer to Significant accounting judgements, estimates and assumptions for further details in relation to the recoverable
amount of assets.
Year-ended 30 June 2021
Based on the impairment analysis performed at 30 June 2021, the Group identified impairments of $638.9 million. The
FY21 impairment charge was allocated to the following:
Narrabri ($548.7 million) due to the reduction in the JORC Coal Reserves on the current Narrabri Mining Lease,
arising out of an optimisation plan which has been developed to focus on the production of higher quality coal over
the balance of mine life
Werris Creek ($90.2 million) due to revisions to its mine plan and uncertainties for this market segment
After the adoption of conservative price assumptions considering the uncertainties in coal markets.
Page 73 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
Leased plant and equipment disclosures
All right-of-use assets recognised as ‘Leased plant and equipment’ above in note 4.1 relate to the plant and equipment
classification.
The cost relating to variable lease payments that do not depend on an index or a rate amounted to $32,600,000 in the
year ended 30 June 2022 (2021: $27,981,000).
The cost relating to leases with a contract term of less than twelve months amounted to $14,822,000 for the year ended
30 June 2022 (2021: $6,261,000).
A maturity analysis of lease liabilities is shown in Note 5.3(c).
Recognition and measurement
Property, plant and equipment
Mining property and development
Property, plant and equipment are measured at cost less
accumulated depreciation and any accumulated
impairment losses. Cost includes expenditure that is
directly attributable to the acquisition of the items and
costs incurred in bringing assets into use. Subsequent
expenditure is capitalised when it is probable that the
future economic benefits associated with the
expenditure will flow to the Group.
Depreciation
Depreciation and amortisation is charged to the
consolidated statement of comprehensive income on a
units of production basis for mine specific assets,
including mining property and development, deferred
development and deferred stripping.
All remaining assets are depreciated on a straight line
basis at the rates indicated below. Depreciation
commences on assets when they are deemed capable of
operating in the manner intended by management.
Freehold land
Plant and equipment
Leased plant
Not depreciated
2% – 50%
3% – 20%
and equipment
Mining property and
development, deferred
development and
deferred stripping
Units of production
The residual value, the useful life and the depreciation
method applied to an asset are reassessed at least
annually. Any changes are accounted for prospectively.
When an asset is surplus to requirements or no longer
has an economic value, the carrying amount of the asset
is written down to its recoverable amount.
Mine property and development assets include costs
transferred from exploration and evaluation assets once
technical feasibility and commercial viability of an area
of interest are demonstrable. After transfer, all
subsequent mine development expenditure is similarly
capitalised, to the extent that commercial viability
conditions continue to be satisfied.
The costs of dismantling and site rehabilitation are
capitalised, if the recognition criteria is met and included
within mining property and development.
Biodiversity assets are included within mining property
and development and relate to land acquired and
managed to fulfil the biodiversity obligations associated
with mine approval. The cost of the land is capitalised as
a mining property and development asset which is
subsequently depreciated via the units of production
method.
Leased plant and equipment
The Group has lease contracts for various items of plant,
machinery and other equipment used in its operations.
At the inception of a contract, the Group assesses
whether a contract is, or contains, a lease based on the
right to use or control an identified asset for a period of
time, in exchange for consideration.
At the commencement date of the lease, the Group
recognises a lease liability and a corresponding right-of-
use asset. The lease liability is initially recognised for the
present value of non-cancellable lease payments
discounted using the interest rate implicit in the lease or,
if that rate cannot be readily determined, the Group’s
incremental borrowing rate. The right-of-use asset is
initially measured at cost, which comprises the initial
amount of the lease liability plus any initial direct costs
incurred and an estimate of costs to dismantle and
remove the underlying asset.
Page 74 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
The right-of-use asset is depreciated to the earlier of the
asset’s useful life or the lease term using the straight line
method and is recognised in the statement of
comprehensive income in depreciation and amortisation.
Where the lease transfers ownership of the underlying
asset to the Group by the end of the lease term, the
right-of-use asset is depreciated from the
commencement date to the end of the useful life of the
underlying asset.
The unwinding of the financial charge on the lease
liability is recognised in the statement of comprehensive
income in financial expenses, and is based on the
implied interest rate or, if used, the Group’s incremental
borrowing rate.
The Group does not recognise leases that have a lease
term of 12 months or less, or are of low value, as a right-
of-use asset or lease liability. Lease payments associated
with these leases are recognised as an expense in the
consolidated statement of comprehensive income in
operating expenses on a straight line basis over the
lease term.
Deferred development
Deferred development mainly comprises capitalised
costs (deferred development expenditure) related to
underground mining incurred to expand the capacity of
an underground mine and to maintain production.
Deferred stripping
Expenditure incurred to remove overburden or waste
material during the production phase of an open cut
mining operation is deferred to the extent it gives rise to
future economic benefits. This expenditure is charged to
operating costs on a units of production basis using the
estimated average stripping ratio for the area being
mined. Changes in estimates of average stripping ratios
are accounted for prospectively. The stripping activity
asset is subsequently depreciated on a units of
production basis over the life of the identified
component of the ore body that became more
accessible as a result of the stripping activity.
For the purposes of assessing impairment, deferred
stripping assets are grouped with other assets of the
relevant cash generating unit (CGU).
Impairment
The carrying amounts of the Group’s non-financial
assets are reviewed at each balance date to determine
whether there is any indication of impairment. If any
such indication exists, the asset’s recoverable amount is
estimated. For intangible assets that have indefinite lives
or that are not yet available for use, the recoverable
amount is estimated at each reporting date.
For the purpose of impairment testing, assets are
grouped together into the smallest group of assets that
generates cash inflows from continuing use, and which
are largely independent of the cash inflows of other
assets or groups of assets – the CGU. The recoverable
amount of an asset or CGU is the greater of its value in
use and its fair value less costs of disposal (‘FVLCD’). In
assessing FVLCD, the estimated future cash flows are
discounted to their present value using a pre-tax
discount rate that reflects current market assessments
of the time value of money and the risks specific to the
asset.
An impairment loss is recognised whenever the carrying
amount of an asset or its CGU exceeds its recoverable
amount. In accordance with AASB 136 Impairment of
Assets, impairment losses have been allocated such that
the carrying value of individual assets within the Group’s
CGU were not reduced below their recoverable amount.
Page 75 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
Significant accounting judgements, estimates and assumptions
If thermal coal is displaced in Asia either more rapidly or
more slowly than our forecasts anticipate, or if supply
reinvestment takes place more slowly than necessary to
meet Asia’s demand, then the resulting supply overhang
or supply shortfall could result in commodity prices
which are lower or higher.
Operating costs and capital expenditure
Operating costs and capital expenditure are based on
the latest budgets and forecasts and longer term life of
mine plans. These projections can include expected
operating performance improvements reflecting
management experience and expectations.
Discount rate
The discount rate is derived using the weighted average
cost of capital methodology adjusted for any risks that
are not reflected in the underlying cash flows. A real
post-tax discount rate is applied to post-tax cash flows.
Mineral reserves and resources
The estimated quantities of economically recoverable
Reserves and Resources are based on interpretations of
geological and geophysical models, which require
assumptions to be made of factors such as estimates of
future operating performance, future capital
requirements and short and long-term coal prices. The
Group is required to determine and report Reserves and
Resources under the Australian Code for Reporting
Mineral Resources and Ore Reserves December 2012
(the JORC Code).
The JORC Code requires the use of reasonable
investment assumptions to calculate reserves and
resources. Changes in reported Reserves and Resources
can impact the carrying value of property, plant and
equipment, as well as provisions for rehabilitation and
the amount charged for amortisation and depreciation.
Recoverable amount of assets
At the end of each period, the Group assesses whether
there is any indication that an asset may be impaired. If
any such indication exists, the Group estimates the
recoverable amount of the asset.
The recoverable amount of the CGU and individual
assets are determined based on value-in-use
calculations. These calculations require the use of
estimates and assumptions.
Expected future cash flows used to determine the
recoverable value of tangible assets are inherently
uncertain and could materially change over time. They
are affected by a number of factors including reserves
and expected production and sales volumes together
with economic factors, such as spot and future coal
prices, discount rates, foreign currency exchange rates,
estimates of costs to produce reserves, stripping ratio,
production rates and future capital expenditure. It is
possible that these assumptions may change, which
could impact the estimated life of a mine and result in a
material adjustment to the carrying value of tangible
assets.
The recoverable amount of the CGU is sensitive to the
below key assumptions:
Demand for fossil fuels/coal price
The recoverable value of the Group’s Coal Reserves and
of its plant and equipment is most sensitive to future
USD coal prices and the AUD:USD foreign exchange
rate, which together impact the AUD price that the
company receives for the sale of its products in the
global energy and steel manufacturing complexes.
In assessing coal prices, we considered our latest
internal forecasts and coal pricing assumptions from
recognised commodity consultants. In determining their
coal price forecasts, the commodity consultants
considered scenarios from the International Energy
Agency (IEA).
The recoverability of assets has been assessed by
undertaking scenario analysis to better understand and
assess external risks to our business and inform
strategic decision making including against the
independent externally verifiable scenarios of the
International Energy Agency (IEA) Stated Policies
Scenario (STEPS) and Sustainable Development
Scenario (SDS). Scenario analysis is not the same as
forecasting: it is a mechanism that uses scenarios, in
some cases with dramatic deviations from a base case
and with varying degrees of profitability, to test
business resilience and to frame consequential financial
outcomes.
Page 76 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
4.2. Exploration and evaluation
Exploration and evaluation assets
Balance at 1 July 2021
Exploration and evaluation expenditure
Balance at 30 June 2022
Balance at 1 July 2020
Exploration and evaluation expenditure
Balance at 30 June 2021
Recognition and measurement
Exploration and evaluation assets, including the costs of
acquiring licences, are capitalised on an area of interest
basis and only after the Company has obtained the legal
rights to explore the area.
Exploration and evaluation assets are only recognised if
the rights of the area of interest are current and either:
i)
The expenditures are expected to be recouped
through successful development and exploitation
of the area of interest, or
ii) Activities in the area of interest have not (at the
reporting date) reached a stage that permits a
reasonable assessment of the existence or
otherwise of economically recoverable reserves,
and active and significant operations in, or in
relation to, the area of interest are continuing.
$’000
613,508
33,781
647,289
591,343
22,165
613,508
Exploration and evaluation assets are assessed for
impairment if:
i)
ii)
Sufficient data exists to determine technical
feasibility and commercial viability, and
Facts and circumstances suggest that the carrying
amount exceeds the recoverable amount. For the
purposes of impairment testing, exploration and
evaluation assets are not allocated to CGUs.
Where a potential impairment is indicated, an
assessment is performed for each area of interest or at
the CGU level, in line with the assessment disclosed at
note 4.1. To the extent that capitalised expenditure is not
expected to be recovered, it is charged to the
consolidated statement of comprehensive income. Once
the technical feasibility and commercial viability of the
extraction of mineral resources in an area of interest are
demonstrable, exploration and evaluation assets
attributable to that area of interest are first tested for
impairment and then reclassified to mining property and
development assets within property, plant and
equipment.
Significant accounting judgements, estimates and assumptions
The application of the Group’s accounting policy for exploration and evaluation expenditure requires judgement in
determining whether future economic benefits are likely, which may be based on assumptions about future events or
circumstances. Estimates and assumptions made may change if new information becomes available. If, after
expenditure is capitalised, information becomes available indicating that the recovery of expenditure is unlikely, the
amount capitalised is written off in the consolidated statement of comprehensive income in the period when the new
information becomes available. The recoverability of the carrying amount of exploration and evaluation assets is
dependent on the successful development and commercial exploitation or sale of the respective areas of interest.
Page 77 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
4.3. Intangible assets
Balance at 1 July 2021
Additions
Balance at 30 June 2022
Balance at 1 July 2020
Impairment2
Balance at 30 June 2021
Water access
rights
Rail
access rights1
$’000
11,828
352
12,180
11,828
-
11,828
$’000
-
-
-
11,118
(11,118)
-
Total
$’000
11,828
352
12,180
22,946
(11,118)
11,828
1 As part of the agreement to cancel previously existing infrastructure sharing arrangements, Whitehaven agreed to pay 10.1% of the construction cost of the shared
portion of the Boggabri-Maules Creek rail spur. In return, Whitehaven received access to rail tonnes on the joint rail spur.
Impairment relates to rail rights which are no longer expected to be utilised.
2
Recognition and measurement
Water access rights
The Group holds water access rights, which have been determined to have an indefinite life. The water access rights
have been recognised at cost and are assessed annually for impairment.
4.4. Provisions
Movement in mine rehabilitation and biodiversity obligations provisions
Balance at 1 July 2021
Payments made on rehabilitation and biodiversity activities
Change in cost estimates
Unwinding of discount
Balance at 30 June 2022
Current
Non-current
Balance at 30 June
$’000
222,212
(12,920)
45,507
4,178
258,977
2021
$’000
18,423
203,789
222,212
2022
$’000
16,461
242,516
258,977
Under the terms of its mining licenses and project approvals, the Group is required to comply with certain rehabilitation
and biodiversity obligations. The Group maintains provisions for these rehabilitation and biodiversity requirements. The
Group continues to assess estimates of these obligations as further developments occur and additional commitments
arise that may be required to settle its obligations. However, based on current estimates, any potential changes to these
obligations and commitments in addition to those already recognised in the financial statements are not financially
significant to the Group.
Page 78 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
Recognition and measurement
Provisions are recognised when:
the Group has a present legal or constructive
obligation as a result of a past event
tt is probable that resources will be expended to
settle the obligation
the amount of the provision can be measured reliably.
Mine rehabilitation and closure
Provisions are made for the estimated cost of
rehabilitation relating to areas disturbed during the
mine’s operation up to reporting date but not yet
rehabilitated. The nature of rehabilitation activities
includes dismantling and removing operating facilities,
recontouring and topsoiling the mine, and restoration,
reclamation and revegetation of affected areas.
Provision has been made in full for all disturbed areas at
the reporting date based on current estimates of costs
to rehabilitate such areas, discounted to their present
value based on expected future cash flows.
The obligation to rehabilitate arises at the
commencement of the mining project and/or when the
environment is disturbed at the mining location. At this
point, the provision is recognised as a liability with a
corresponding asset included in mining property and
development assets. Additional disturbances or changes
in the rehabilitation costs are reflected in the present
value of the rehabilitation provision, with a
corresponding change in the cost of the associated
asset. In the event the restoration provision is reduced,
the cost of the related asset is reduced by an amount
not exceeding its carrying value.
The unwinding of the effect of discounting the provision
is recorded as a finance cost in the consolidated
statement of comprehensive income. The carrying
amount capitalised as a part of mining property and
development assets is depreciated over the useful life of
the related asset.
For closed mines, changes to estimated costs are
recognised immediately in the consolidated statement
of comprehensive income.
The amount of the provision relating to rehabilitation of
environmental disturbance caused by ongoing
production and extraction activities is recognised in the
consolidated statement of comprehensive income as
incurred.
Biodiversity obligations
The Group has, under the terms of certain mining
licenses, obligations to perform works to establish or
upgrade biodiversity offset areas and to set aside and
maintain those areas. Provisions are made for the
estimated cost of the Group’s biodiversity obligations
based on current estimates of certain activities that the
Group has committed to perform. These costs are
discounted to their present value based on expected
future cash flows. The provision is recognised as a
liability with a corresponding asset included in mining
property and development assets. The unwinding of the
effect of discounting the provision is recorded as a
finance cost in the consolidated statement of
comprehensive income. The carrying amount capitalised
as a part of mining property and development is
depreciated via the units of production method.
Significant accounting judgements, estimates and assumptions
Significant estimates and assumptions are made in determining the provision for mine rehabilitation and biodiversity
as there are numerous factors that will affect the ultimate liability payable. These factors include estimates of the
extent and costs of rehabilitation activities and biodiversity, technological changes, regulatory changes, cost
increases and changes in discount rates. Those uncertainties may result in future actual expenditure differing from
the amounts currently provided. The provisions at balance date represent management’s best estimate of the present
value of the future rehabilitation and biodiversity costs required.
Page 79 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
5. Capital structure and financing
5.1. Interest-bearing liabilities
Current liabilities
Lease liabilities
Secured loans – ECA facility
Capitalised borrowing costs
Non-current liabilities
Senior bank facility
Lease liabilities
Secured loans – ECA facility
Capitalised borrowing costs
Financing facilities
Facilities utilised at reporting date
2022
$’000
71,665
9,470
(3,292)
77,843
2021
$’000
72,191
9,796
(6,871)
75,116
-
688,000
130,825
38,730
(2,701)
166,854
244,697
190,729
48,200
(9,332)
917,597
992,713
1,250,690
1,320,916
250,690
1,008,916
Facilities not utilised at reporting date
1,000,000
312,000
Financing activities during the financial year
During the current year, $728 million of debt drawn under the senior bank facility was repaid (30 June 2021: $60 million)
and $40 million was redrawn (30 June 2021: $110 million). The Group repaid $9.8 million of the ECA facility during the
year (30 June 2021: $10.1 million) and $nil was drawn down (30 June 2021: $nil). The senior bank facility and the ECA
facilities are secured via a fixed and floating charge over the majority of the Group’s assets. Under the facility, the Group
is subject to compliance with gearing, net worth and interest coverage financial covenants.
Included within current and non-current lease liabilities are leases recognised in accordance with AASB 16 Leases of
$24,725,000 and $42,281,000 respectively (30 June 2021: $33,743,000 and $55,244,000 respectively). Lease liabilities
are secured over the leased assets to which they relate.
The fair values of loans and borrowings materially approximate their respective carrying values as at 30 June 2022 and
30 June 2021.
Recognition and measurement
All loans and borrowings are initially recognised at the fair value of the consideration received less directly
attributable transaction costs. After initial recognition, interest-bearing loans and borrowings are subsequently
measured at amortised cost using the effective interest method.
Refer to note 4.1 for the recognition and measurement policy for lease liabilities.
Page 80 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
5.2. Finance income and expense
Recognised in the statement of comprehensive income
Interest income
Finance income
Interest expense on lease liabilities
Interest on drawn debt facility
Other financing costs
Interest and financing costs
Net interest expense
Unwinding of discounts on provisions
Amortisation of finance facility upfront costs
Other finance expenses
Net finance expense
Recognised directly in equity
Net change in cash flow hedges
Income tax effect
Finance expense recognised directly in other comprehensive income, net of tax
2022
$’000
1,464
1,464
(9,322)
(10,266)
(18,691)
(38,279)
(36,815)
(4,178)
(14,368)
(18,546)
2021
$’000
228
228
(11,906)
(20,865)
(13,100)
(45,871)
(45,643)
(3,269)
(13,102)
(16,371)
(55,361)
(62,014)
(88)
26
(62)
(15,146)
4,544
(10,602)
Recognition and measurement
Finance income comprises interest income on funds invested and foreign currency gains. Interest income is
recognised as it accrues, using the effective interest method.
Finance expenses comprise interest expense on borrowings, unwinding of the discount on provisions, changes in the
fair value of financial assets at fair value through profit or loss, impairment losses recognised on financial assets, and
losses on hedging instruments that are recognised in profit or loss. All borrowing costs are recognised in the
consolidated statement of comprehensive income using the effective interest method, except where capitalised as
part of a qualifying asset.
Foreign currency gains and losses are reported on a net basis.
Page 81 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
5.3. Financial risk management objectives and policies
a) Overview
The Group’s overall risk management program seeks to mitigate risks and reduce the volatility of its financial
performance. Financial risk management is carried out centrally by Group Treasury and monitored by the Group’s Audit &
Risk Management Committee under policies approved by the Board of Directors. The Committee reports regularly to the
Board on its activities and also reviews policies and systems regularly to reflect changes in market conditions and the
Group’s activities.
The Group’s principal financial risks are associated with:
market risk
credit risk
liquidity risk.
b) Capital management
The Board’s policy is to maintain a strong capital base so as to maintain investor, creditor and market confidence and to
sustain future development of the business. The Group defines capital as the total of shareholders’ equity and debt. The
Board manages its capital structure and makes adjustments in light of changes to economic conditions and the
requirements of the financial covenants. To maintain or adjust the capital structure, the Group may adjust the dividend
payment to shareholders, return capital to shareholders, seek waivers or restructure its arrangements with its financiers
or issue new shares. The Group monitors capital using a gearing ratio, which is net debt divided by total capital plus net
debt.
There were no changes in the Group’s approach to capital management during the year.
The Group’s gearing ratio is calculated as net debt divided by total equity plus net debt.
Interest-bearing liabilities
Less cash and cash equivalents
Net cash/(debt)
Equity
Equity and net debt
Gearing ratio
1 Calculated including lease liabilities under AASB 16 Leases of $88,987,000.
2022
$’000
(244,697)
1,215,460
970,763
4,211,634
3,240,871
2021
$’000
(992,713)
95,202
(897,511)
2,705,738
3,603,249
n/a
25%1
Page 82 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
c) Risk exposures and responses
Market risk - foreign currency risk
The Group is exposed to currency risk on sales, purchases and demurrage that are denominated in a currency other than
the respective functional currency of the Group, the Australian dollar (AUD). The currency in which these transactions
primarily are denominated is US dollars (USD).
The Group may use forward exchange contracts (FECs) to hedge its currency risk in relation to contracted sales where
both volume and US dollar price are fixed.
In respect of other monetary assets and liabilities denominated in foreign currencies, the Group ensures that its net
exposure is kept to an acceptable level by buying and selling foreign currencies at spot rates when necessary to address
short-term imbalances.
During the current year ended 30 June 2022, a net foreign exchange gain of $7.6 million was recognised (30 June 2021:
net foreign exchange loss of $4.3 million).
The Group designates its forward exchange contracts in cash flow hedges and measures them at fair value.
The fair value of forward exchange contracts used as hedges at 30 June 2022 was a $7.8 million liability (30 June 2021:
$7.7 million liability), comprising assets and liabilities that were recognised as derivatives.
At 30 June 2022, the Group had the following financial instruments that were not designated in cash flow hedges that
were exposed to foreign currency risk:
Cash and cash equivalents
Trade and other receivables
Trade and other payables
Net statement of financial position exposure
The following exchange rates applied during the year:
Fixed-rate instruments
USD
Sensitivity analysis
2022
$’000
USD
147,409
4,904
(34,205)
118,108
2021
$’000
USD
19,310
28,159
(8,416)
39,053
Average rate
Reporting date spot rate
2022
0.7258
2021
0.7468
2022
0.6889
2021
0.7518
A change of 10% in the Australian dollar against the following currencies at 30 June would have increased/(decreased)
equity and pre-tax profit or loss by the amounts shown below. The analysis assumes that all other variables, in particular
interest rates, remain constant.
30 June 2022
AUD:USD strengthening by 10%
AUD:USD weakening by 10%
30 June 2021
AUD:USD strengthening by 10%
AUD:USD weakening by 10%
Equity
Profit or (loss)
$’000
$’000
1,978
(19,684)
7,916
(9,634)
(15,586)
19,049
(4,722)
5,772
Page 83 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
Market risk - interest rate risk
The Group‘s borrowings comprise both variable and fixed rate instruments. The variable rate borrowings expose the
Group to the risk of changes in cash flows due to the changes in interest rates. Management analyses interest rate
exposure on an ongoing basis.
The interest rate profile of the Group‘s interest-bearing financial instruments at the reporting date was:
Fixed rate instruments
Lease liabilities
Variable rate instruments
Financial assets
Financial liabilities
Carrying amount
2022
$’000
2021
$’000
(202,490)
(262,920)
(202,490)
(262,920)
1,215,460
(48,201)
95,202
(745,996)
1,167,259
(650,794)
Sensitivity analysis for variable rate instruments
A change of 100 basis points (bp) in interest rates at the reporting date would have increased/(decreased) equity and
profit or loss by the amounts shown below. This analysis assumes that all other variables, in particular foreign currency
rates, remain constant.
30 June 2022
100bp increase
100bp decrease
30 June 2021
100bp increase
100bp decrease
Equity
Profit or (loss)
$’000
$’000
-
-
-
-
11,673
(11,673)
(6,508)
6,508
Market risk - commodity price risk
The Group’s major commodity price exposure is to the price of coal. The Group has chosen not to hedge against the
movement in coal prices.
Credit risk
Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract,
leading to a financial loss. The Group is exposed to credit risk from its financial assets, including trade receivables,
deposits with banks and other financial institutions, foreign exchange transactions and other financial instruments.
Maximum exposure is equal to the carrying amount of the financial assets, as outlined below.
Page 84 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
Exposure to credit risk
The Group’s maximum exposure to credit risk at the reporting date was:
Cash and cash equivalents
Trade and other receivables
Derivative financial instruments
Investments
Note
3.1
5.3(d)
5.3(e)
Carrying amount
2022
$’000
1,215,460
600,700
105
856
2021
$’000
95,202
95,715
-
37
1,817,121
190,954
The Group’s maximum exposure to credit risk for trade receivables at the reporting date by geographic region was:
Asia
Australia
Europe
Trade receivables
564,062
36,630
8
600,700
84,405
11,310
-
95,715
The Group‘s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The
demographics of the Group’s customer base, including the default risk of the industry and country in which customers
operate, has less of an influence on credit risk. Approximately 43.4% of the Group’s revenue is attributable to sales
transactions with three customers (2021: 40.5% with three customers).
The Group trades only with recognised, creditworthy third parties and generally does not require collateral with respect
to trade receivables.
Receivable balances are monitored on an ongoing basis and as a result the exposure to bad debts is not significant.
The Group recognised an impairment loss for trade receivables of $nil during the year ended 30 June 2022 (2021: $nil).
The aging of the Group’s trade receivables at the reporting date was:
Not past due
Past due 0-30 days
Past due 31-120 days
Past due 121 days to one year
More than one year
Guarantees
Gross
2022
$’000
598,217
2,064
419
-
-
Gross
2021
$’000
91,517
3,958
240
-
-
600,700
95,715
The policy of the Group is to provide bank guarantees for bonding requirements associated with mining operations,
infrastructure assets and other purposes such as security of leased premises. Guarantees are provided under the senior
secured bank facility, secured bilateral bank guarantee facilities and unsecured bank facilities. Details of outstanding
guarantees are provided in note 7.4.
Page 85 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group’s
approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its
liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage
to the Group’s reputation.
Typically, the Group ensures that it has sufficient cash on demand to meet all expected operational expenses as and
when due, including the servicing of financial obligations. This excludes the potential impact of extreme circumstances
that cannot reasonably be predicted, such as natural disasters.
The following are the contractual undiscounted maturities of financial liabilities, including estimated interest payments:
30 June 2022
Carrying
amount
Contractual
cash flows
6 months
or less
6-12
months
1-2 years
2-5 years
More than
5 years
$’000
$’000
$’000
$’000
$’000
$’000
$’000
Financial liabilities
Lease liabilities
Secured loans
Trade and other payables
Forward exchange contracts:
Outflow
Inflow
202,490
232,440
38,072
40,532
48,296
48,201
410,361
50,657
5,174
412,239
354,309
208,283
208,672
176,337
(200,510)
(200,510)
(168,270)
5,124
7,248
209
(212)
10,121
20,426
68,910
23,746
30,256
16,077
16,049
(16,014)
(16,014)
36,630
6,492
-
-
-
668,825
703,498
405,622
52,901
78,906
122,947
43,122
30 June 2021
Carrying
amount
Contractual
cash flows
6 months
or less
6-12
months
1-2 years
2-5 years
More than
5 years
$’000
$’000
$’000
$’000
$’000
$’000
$’000
Financial liabilities
Lease liabilities
262,920
300,961
42,754
38,588
76,453
103,441
39,725
Senior bank facility
688,000
688,000
-
57,996
277,537
61,463
5,593
279,843
231,602
-
5,212
-
-
688,000
10,298
16,115
27,243
32,126
Secured loans
Trade and other payables
Forward exchange contracts:
Outflow
Inflow
-
13,117
-
-
-
209,885
209,957
157,715
4,001
16,115
32,126
(202,200)
(202,200)
(154,210)
(3,984)
(14,669)
(29,337)
1,294,138
1,338,024
283,454
43,817
104,312
853,599
52,842
Page 86 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
d) Net fair values
The following table provides the fair value measurement hierarchy of the Group’s financial assets and financial liabilities as
at 30 June 2022 and 30 June 2021.
Level 1: measurements based on quoted prices (unadjusted) in active markets for identical assets or liabilities
Level 2: measurements based on inputs other than quoted prices included within level 1 that are observable for the
asset or liability, either directly (as prices) or indirectly (derived from prices)
Level 3: measurements based on inputs for the asset or liability that are not based on observable market data
(unobservable inputs).
The Group held the following financial instruments carried at fair value in the consolidated statement of financial position:
30 June 2022
$’000
Level 1
$’000
Level 2
$’000
Level 3
$’000
Assets measured at fair value
Equity shares
Forward exchange contracts - receivable
Liabilities measured at fair value
Forward exchange contracts - payable
Assets measured at fair value
Equity shares
Forward exchange contracts - receivable
Liabilities measured at fair value
Forward exchange contracts - payable
856
105
961
(7,878)
(7,878)
-
-
-
-
-
30 June 2021
$’000
Level 1
$’000
37
-
37
(7,685)
(7,685)
-
-
-
-
-
-
105
105
(7,878)
(7,878)
Level 2
$’000
-
-
-
(7,685)
(7,685)
856
-
856
-
-
Level 3
$’000
37
-
37
-
-
The fair value of derivative financial instruments are derived using valuation techniques based on observable market
inputs, such as forward currency rates, at the end of the reporting period. The amounts disclosed in the consolidated
statement of financial position are the fair values and are classified under level 2 in the fair value measurement hierarchy.
During the period the Group entered into forward exchange contracts to hedge some foreign exchange risk. A number of
these contracts remained open at 30 June 2022.
The carrying values of financial assets and financial liabilities recorded in the financial statements materially approximates
their respective net fair values, determined in accordance with the accounting policies disclosed in notes 3.1, 3.3 and 5.1 to
the financial statements.
Page 87 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
e)
Financial assets and liabilities by categories
Financial assets
Cash and cash equivalents
Trade and other receivables
Investments
Other financial assets1
Total financial assets
2022
Amortised
cost
Note
$’000
3.1
5.3(d)
5.3(d)
1,215,460
664,757
-
-
1,880,217
1 Other financial assets at 30 June 2022 include $0.1 million relating to derivatives in designated hedges.
Financial liabilities
Trade and other payables
Loans and borrowings
Other financial liabilities2
Total financial liabilities
2022
Amortised
cost1
Note
$’000
3.3
5.1
5.3(d)
410,361
244,697
-
655,058
2021
Amortised
cost
$’000
95,202
165,948
-
-
261,150
2021
Amortised
cost1
$’000
277,537
992,713
-
1,270,250
Other1
$’000
-
-
856
105
961
Other2
$’000
-
-
7,878
7,878
Other1
$’000
-
-
37
-
37
Other2
$’000
-
-
7,685
7,685
1
Loans at amortised cost are non-derivatives with fixed or determinable payments and are not quoted on an active market. Loans and payables are valued at
amortised cost.
2 Other financial liabilities include $7.9 million (2021: $7.7 million) relating to derivatives in designated hedges.
f)
Changes in liabilities arising from financing activities
As at 1 July
Outflows from secured loans
Outflows from lease liabilities
Net (outflows)/inflows from senior bank facility
Increase/(Decrease) in lease liabilities
As at 30 June
Consisting of:
Current loans and borrowings1
Non-current loans and borrowings2
1 Current loans and borrowings does not include capitalised borrowing costs of $3,292,000 (2021: $6,871,000)
2 Non-current loans and borrowings does not include capitalised borrowing costs of $2,701,000 (2021: $9,332,000).
The Group classifies interest paid as cash flows from operating activities.
30 June 2022
30 June 2021
$’000
$’000
1,008,916
1,052,720
(9,795)
(76,673)
(688,000)
16,242
(10,119)
(82,738)
50,000
(947)
250,690
1,008,916
81,135
169,555
81,987
926,929
Page 88 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
Recognition and measurement
Financial assets
Derivatives and hedge accounting:
The Group classifies its financial assets into the following
categories: those to be measured subsequently at fair
value (either through other comprehensive income, or
profit or loss) and those to be held at amortised cost.
Classification depends on the business model for
managing the financial assets and the contractual terms
of the cash flows.
At initial recognition, the Group measures a financial
asset at its fair value.
The Group uses derivative financial instruments to
hedge its risks associated with foreign currency and
interest rate fluctuations arising from operating
activities. Such derivative financial instruments are
initially recognised at fair value as at the date on which a
derivative contract is entered into and are subsequently
remeasured at fair value. Derivatives are carried as
financial assets when the fair value is positive and as
financial liabilities when the fair value is negative.
Financial liabilities
Financial liabilities are classified, at initial recognition, as
financial liabilities at fair value through profit or loss,
loans and borrowings, payables, or derivatives
designated as hedging instruments.
All financial liabilities are recognised initially at fair value.
The Group’s financial liabilities include trade and other
payables, loans and borrowings and derivative financial
instruments.
Cash flow hedges:
The effective portion of the gain or loss on the hedging
instrument is recognised in other comprehensive income
in the cash flow hedge reserve. To the extent that the
hedge is ineffective, changes in fair value are recognised
in profit or loss. Amounts taken to other comprehensive
income are transferred out of other comprehensive
income and included in the measurement of the hedged
transaction when the forecast transaction occurs. Hedge
accounting is discontinued prospectively when a
hedging instrument expires, or is sold or terminated, or
when a hedge no longer meets the criteria for hedge
accounting. The cumulative gain or loss previously
recognised in other comprehensive income remains in
other comprehensive income until the forecast
transaction occurs.
Page 89 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
5.4. Share capital and reserves
a)
Share capital
Fully paid ordinary share capital
1,032,644,232
3,013,661
2022
2021
Number of shares
$’000 Number of shares
$’000
Ordinary share capital at the beginning of the period
1,032,644,232
3,013,661
1,026,045,885
3,003,964
Shares issued
Share buy-back1
Transfer of shares by share plan
Shares purchased by share plan
-
-
6,598,347
(76,372,580)
(362,568)
-
-
4,124
(12,879)
-
-
-
6,268
-
4,766
(1,337)
Ordinary share capital at the end of the period
956,271,652
2,642,338
1,032,644,232
3,013,661
1
Includes share trade entered into on 30 June 2022 for 738,311 shares totalling $3,587,970, which was settled and paid on 4 July 2022.
At 30 June 2022, a trust on behalf of the Company held 2,502,186 ordinary fully paid shares in the Company (30 June 2021: 4,123). During the year, 1,611,937 of these shares
were transferred to performance rights plan recipients and 4,110,000 purchased by the share plan. These were purchased during the year for the purpose of allowing the
Group to satisfy performance rights to certain management of the Group. Refer to note 5.5 for further details on the performance rights plan.
Terms and conditions of issued capital
Ordinary shares are classified as equity. Fully paid ordinary shares carry one vote per share (either in person or by proxy)
at a meeting of the Company and carry the right to receive dividends as declared. In the event of a winding up of the
Company, fully paid ordinary shares carry the right to participate in the proceeds from the sale of all surplus assets in
proportion to the number of and amounts paid up on shares held. Under the terms of the acquisition of Boardwalk
Resources Limited, 34,020,000 ordinary shares are subject to a restriction deed, which removes their entitlement to vote,
receive dividends as declared or participate in the proceeds from the sale of all surplus assets. These restrictions will be
released on reaching certain milestones.
Incremental costs directly attributable to the issue of ordinary shares and share options are recognised as a deduction
from equity, net of any related income tax benefit.
b) Nature and purpose of reserves
Hedge reserve
The hedging reserve comprises the effective portion of the cumulative change in the fair value of cash flow hedging
instruments related to hedged transactions that have not yet occurred.
Share-based payment reserve
The share-based payment reserve is used to record the value of share-based payments provided to Director-related
entities and senior employees under share option and long-term incentive plans. Refer to note 5.5 for further details of
these plans.
c) Dividends
Dividends of $79,890,000 were paid to shareholders during the year ended 30 June 2022 (2021: $nil).
On 25 August 2022, the Directors declared a fully franked final dividend of 40 cents per share totalling $368.9 million to
be paid on 16 September 2022.
Dividend franking account
As at 30 June 2022, $nil franking credits were available to shareholders of Whitehaven Coal Limited (30 June 2021: $nil).
When the final dividend is paid on 16 September 2022, the franking account will be in a deficit balance until the Group’s
FY22 tax liability is paid in full to the ATO on 1 December 2022, returning the account to a credit balance.
Page 90 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
5.5. Share-based payments
a) Recognised share-based payment expenses
Employee expenses
Share options and performance rights – senior employees
Recognition and measurement:
2022
$’000
9,234
2021
$’000
6,995
The grant date fair value of options and performance rights granted to employees is recognised as an expense, with
a corresponding increase in equity, over the period in which the employees become unconditionally entitled to the
equity instruments. The amount recognised is adjusted to reflect the actual number of instruments that vest, except
for those that fail to vest due to market conditions not being met. Once the instruments have vested, no further
expenses are recognised nor reserves reversed in respect to costs already charged. However, where the share rights
or options have lapsed after vesting, the Group transfers the equivalent amount of the cumulative cost for the lapsed
awards from the share-based payments reserve to another component of equity.
b) Types of share-based payment plans
Performance right and option grant to CEO and senior employees
The Company issued performance rights to the CEO and senior employees under the Company’s medium and long-term
incentive (MTI and LTI) programs in FY21 and FY22. The terms and conditions of the grant are as follows:
Performance rights
MTI
LTI tranche 1
LTI tranche 2
LTI tranche 3
LTI tranche 4
Total
2022
2021
Number of
instruments
Vesting date
Number of
instruments
Vesting date
2,424,720
30 June 2024
2,948,107
30 June 2023
671,499
30 June 2024
909,933
30 June 2023
671,499
30 June 2025
909,928
30 June 2024
1,764,165
30 June 2024/251
2,305,625
30 June 2023/241
421,171
30 June 2025
485,768
30 June 2024
5,953,054
7,559,361
1 To the extent that the Costs Hurdle Award is satisfied at the end of the year of testing, 50% of the awards will vest and become exercisable immediately and the
remaining 50% will continue on foot, subject to a further one year service condition.
The performance rights are subject to a performance measure linked to relative total shareholder return (TSR), a Costs
Hurdle and a Strategic Priority Delivery (SPD) metric. The TSR performance measure compares the TSR performance of
the Company with the TSR performance of the S&P ASX 100 index. The Costs Hurdle performance measure relates to the
Company achieving a cost per tonne target referenced to the industry first quartile. The SPD performance measure
drives a focus on the efficient delivery of long-term projects that directly impact shareholder value. The Company must
also achieve positive TSR performance before any vesting of SPD rights. Detailed disclosures of LTI outcomes against the
target are provided in the Remuneration Report.
The table below details the outcomes of MTI awards that were tested in FY22 (or for which the test period concluded on
30 June 2022) and the results of the relevant test:
MTI Year
Test Type
2019
2019
Relative TSR
Costs Target Hurdle
Performance
68th percentile
75th percentile
Outcomes
Vested
86.84%
100%
Lapsed
13.16%
0%
Page 91 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
c) Movement in options and performance rights
The following table illustrates the number and weighted average exercise prices of, and movements in, options and
performance rights during the year:
Outstanding at beginning of period
Exercised during the period
Granted during the period
Forfeited during the period
Lapsed during the period
Outstanding at 30 June
Exercisable at 30 June
Weighted
average
exercise price
Number of
options/rights
Weighted
average
exercise price
Number of
options/rights
2022
$0.17
$0.72
$0.00
$0.00
$0.78
$0.00
$0.00
2022
14,178,517
(1,393,492)
6,805,5611
(1,605,058)
(1,868,527)
16,117,001
32,549
2021
$0.59
$0.00
$0.00
$0.19
$1.34
$0.17
$0.92
2021
14,230,664
(2,605,673)
8,338,2272
(1,606,826)
(4,177,875)
14,178,517
1,095,626
1
2
Includes 852,507 performance rights granted during the year under the FY21 STI scheme.
Includes 643,067 performance rights granted during the year under the FY20 STI scheme.
The outstanding balance as at 30 June 2022 is represented by:
Options/performance rights over ordinary shares
Number
Exercise price
Dates exercisable between
Performance rights
Performance rights
Performance rights
Performance rights
Performance rights
Performance rights
Outstanding at 30 June 2022
18,983
3,095
235,805
2,399,798
6,788,764
6,670,556
16,117,001
$nil
$nil
$nil
$nil
$nil
$nil
30 June 2022 - 13 August 2026
30 June 2022 - 31 August 2027
30 June 2022 - 27 October 2028
30 June 2022 - 28 October 2029
30 June 2022 - 31 October 2030
25 August 2022 - 31 October 2031
During the year ended 30 June 2022, 830,531 share options and 562,961 performance rights were exercised (2021: nil
share options and 2,605,673 performance rights).
The weighted average remaining contractual life of share options and performance rights outstanding at 30 June 2022 is
8.6 years (2021: 7.9 years).
Page 92 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
d) Option pricing models
The fair value of performance rights granted under the LTI and MTI programs with a TSR performance hurdle is measured
using a Monte Carlo simulation model incorporating the probability of the performance hurdles being met. The fair value
of performance rights with the non-market performance hurdle (costs target) is measured using the Black-Scholes option
pricing formula.
The fair value of options with a TSR performance hurdle and non-market performance hurdle is measured using a
combination of the Monte Carlo simulation model and Binomial Option Pricing methods.
The following table lists the inputs to the models used for the years ended 30 June 2022 and 30 June 2021:
Rights
2022
Performance hurdle
Grant date
Vesting date
Fair value at grant date
Share price
Expected volatility
MTI
TSR
MTI
Cost
LTI
TSR
LTI
TSR
LTI
Cost
LTI
LTI
Cost TSR/Strategic
Objectives
26 Nov 21
26 Nov 21
26 Nov 21
26 Nov 21
26 Nov 21
26 Nov 21
26 Nov 21
30 Jun 24
30 Jun 24
30 Jun 24
30 Jun 25
30 Jun 24
30 Jun 25
30 Jun 25
$1.78
$2.44
40%
$2.44
$2.44
40%
$1.78
$2.44
40%
$1.80
$2.44
40%
$2.44
$2.44
40%
$2.44
$2.44
40%
$1.85
$2.44
40%
Performance right life
10 years
10 years
10 years
10 years
10 years
10 years
10 years
Risk-free interest rate
0.40%
0.40%
0.40%
0.74%
0.40%
0.74%
0.74%
2021
Performance hurdle
Grant date
Vesting date
Fair value at grant date
Share price
Expected volatility
MTI
TSR
MTI
Cost
Rights
LTI
TSR
LTI
TSR
LTI
Cost
LTI
LTI
Cost TSR/Strategic
Objectives
4 Dec 20
4 Dec 20
4 Dec 20
4 Dec 20
4 Dec 20
4 Dec 20
4 Dec 20
30 Jun 23
30 Jun 23
30 Jun 23
30 Jun 24
30 Jun 23
30 Jun 24
30 Jun 24
$0.91
$1.61
40%
$1.61
$1.61
40%
$0.91
$1.61
40%
$0.97
$1.61
40%
$1.61
$1.61
40%
$1.61
$1.61
40%
$1.09
$1.61
40%
Performance right life
10 years
10 years
10 years
10 years
10 years
10 years
10 years
Risk-free interest rate
0.12%
0.12%
0.12%
0.14%
0.12%
0.14%
0.14%
All share-based payments for existing employees are equity settled.
Page 93 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
6. Group structure
6.1. Group’s subsidiaries
The below is a list of the Group’s subsidiaries, all of which are incorporated in Australia unless otherwise noted:
Ownership interest
2022
2021
Ownership interest
2022
2021
Parent entity
Whitehaven Coal Limited
Subsidiaries
Whitehaven Coal Mining Limited1
100%
100% Maules Creek Coal Pty Ltd1
Namoi Mining Pty Ltd1
100%
100% Boardwalk Resources Limited1
Namoi Agriculture & Mining Pty Ltd
100%
100% Boardwalk Coal Management Pty Ltd1
Betalpha Pty Ltd1
100%
100% Boardwalk Coal Marketing Pty Ltd1
Tarrawonga Coal Pty Ltd1
100%
100% Boardwalk Sienna Pty Ltd1
Tarrawonga Coal Sales Pty Ltd2
100%
100% Boardwalk Monto Pty Ltd1
Whitehaven Coal Holdings Pty Ltd1
100%
100% Boardwalk Dingo Pty Ltd1
Whitehaven Coal Infrastructure Pty Ltd1
100%
100% Boardwalk Ferndale Pty Ltd1
Narrabri Coal Australia Pty Ltd2
100%
100% Coalworks Limited1
Narrabri Coal Pty Ltd1
100%
100% Yarrawa Coal Pty Ltd1
Narrabri Coal Operations Pty Ltd1
100%
100%
Loyal Coal Pty Ltd
Narrabri Coal Sales Pty Ltd1
100%
100%
Ferndale Coal Pty Ltd
Creek Resources Pty Ltd1
100%
100% Coalworks (Oaklands North) Pty Ltd1
Werris Creek Coal Sales Pty Ltd1
100%
100% CWK Nominees Pty Ltd1
Werris Creek Coal Pty Ltd1
100%
100% Oaklands Land Pty Ltd1
WC Contract Hauling Pty Ltd1
100%
100% Coalworks (Vickery South) Pty Ltd1
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
92.5%
92.5%
92.5%
92.5%
100%
100%
100%
100%
100%
100%
100%
100%
Whitehaven Blackjack Pty Ltd1
100%
100% Coalworks Vickery South Operations Pty Ltd1
100%
100%
Whitehaven Project Pty Ltd1
100%
100% Vickery South Marketing Pty Ltd1
Whitehaven Employee Share Plan Pty Ltd1
100%
100% Vickery South Operations Pty Ltd1
Whitehaven WS Pty Ltd2
Aston Resources Limited1
Aston Coal 2 Pty Ltd1
Aston Coal 3 Pty Ltd1
100%
100% Vickery South Pty Ltd1
100%
100% Vickery Coal Pty Ltd2
100%
100% Winchester South WS Pty Ltd
100%
100% Winchester South Coal Operations Pty Ltd2
100%
100%
1 These subsidiaries entered into a Class Instrument 2016/785 dated 28 September 2016 and related deed of cross guarantee with Whitehaven Coal Limited. Refer to
Note 6.4 for further information.
2 These subsidiaries entered into a Class Instrument 2016/785 dated 24 June 2020 and related deed of cross guarantee with Whitehaven Coal Limited. Refer to Note
6.4 for further information.
Recognition and measurement
Subsidiaries are entities controlled by the Company. Control exists when the Company is exposed to, or has rights to,
variable returns from its involvement with an entity and has the ability to affect those returns through its power over
the entity. The financial statements of subsidiaries are included in the consolidated financial statements from the date
on which control commences until that control ceases. All intercompany balances and transactions have been
eliminated in preparing the consolidated financial statements.
Page 94 | Whitehaven Coal Annual Report 2022
100%
100%
100%
100%
100%
100%
100%
100%
100%
100%
Notes to the consolidated financial statements
For the year ended 30 June 2022
6.2. Interest in joint operations
The Group has interests in the following joint operations that are measured in accordance with the terms of each
arrangement, which are in proportion to the Group’s interest in each asset, liability, income and expense of the joint
operations:
Narrabri Coal Joint Venture1
Maules Creek Joint Venture1
Dingo Joint Venture1
Ferndale Joint Venture1
Boggabri-Maules Creek Rail Spur Joint Venture1
Maules Creek Marketing Pty Ltd2
Boggabri-Maules Creek Rail Pty Ltd2
Country of incorporation
Australia
Australia
Ownership interest and voting rights
2022
77.5%
75%
70%
92.5%
39%
75%
39%
2021
77.5%
75%
70%
92.5%
39%
75%
39%
1 These entities have been classified as joint operations under AASB 11 Joint Arrangements, as these joint arrangements are not structured through separate vehicles.
2 The joint operations above operate as the sales and marketing vehicles or manager of the related unincorporated joint operations and require joint consent from all joint
venture partners on all significant management and financial decisions. The Group recognises its share of assets, liabilities, revenues and expenses of the above entities
as joint operations under AASB 11 Joint Arrangements.
Recognition and measurement
Joint arrangements are arrangements in which two or more parties have joint control. Joint control is the
contractually agreed sharing of control over an arrangement, which exists only when decisions about relevant
strategic and/or key operating decisions require the unanimous consent of the parties sharing control.
The consolidated financial statements of the Group include its share of the assets and liabilities, revenues and
expenses arising jointly or otherwise from those operations, and its revenue derived from the sale of its share of
goods and services from the joint operation. All such amounts are measured in proportion to the Group’s interest in
the joint operation.
Significant accounting judgements, estimates and assumptions
The Group assesses whether it has the power to direct the relevant activities of the investee by considering the rights
it holds with respect to the work program and budget approval, investment decision approval, voting rights in joint
operating committees and changes to joint arrangement participant holdings. Where the Group has joint control,
judgement is also required to assess whether the arrangement is a joint operation or a joint venture.
6.3. Parent entity information
Information relating to Whitehaven Coal Limited
Current assets
Total assets
Current liabilities
Total liabilities
Issued capital
Retained earnings
Share-based payments reserve
Total shareholders’ equity
Loss of the parent entity1
Total comprehensive loss of the parent entity
Company
2022
$’000
504,802
2,321,112
-
-
2,780,095
(473,850)
14,867
2021
$’000
302,100
2,759,914
-
-
3,142,664
(394,963)
12,213
2,321,112
2,759,914
(2,812)
(2,812)
(654,191)
(654,191)
1
Included within the loss for the year ended 30 June 2022 is a charge of $nil (FY21: $650 million) relating to impairment of investments in subsidiaries. Refer to note 2.2
for details of impairment of the underlying assets.
Page 95 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
6.4. Deed of cross guarantee
Pursuant to ASIC Corporations Instrument 2016/785 dated 28 September 2016, the wholly owned subsidiaries listed in
Note 6.1 (refer footnote 1) are relieved from the Corporations Act 2001 (Cth) requirements for the preparation, audit and
lodgement of financial reports, and directors’ reports.
It is a condition of the Class Order that the Company and each of the subsidiaries enter into a deed of cross guarantee
(the ‘Deed’). The effect of the Deed is that the Company guarantees to each creditor payment of any debt in full in the
event of winding up of any of the subsidiaries under certain provisions of the Corporations Act 2001 (Cth). If a winding up
occurs under other provisions of the Corporations Act 2001 (Cth), the Company will only be liable in the event that after
six months any creditor has not been paid in full. The subsidiaries have also given similar guarantees in the event that the
Company is wound up.
The Company and each of the relevant subsidiaries entered into the Deed on 27 June 2008 with subsequent assumption
deeds entered into on 27 June 2012, 25 June 2013 and 24 June 2020.
The following consolidated statement of comprehensive income and statement of financial position comprises the
Company and its controlled entities which are party to the Deed (‘Closed Group’) after eliminating all transactions
between parties to the Deed.
Statement of comprehensive income
Profit/(loss) before tax
Income tax (expense)/benefit
Profit/(loss) after tax
Other comprehensive income
Items that may be reclassified subsequently to profit or loss
Net movement on cash flow hedges
Income tax effect
Other comprehensive income/(loss) for the period, net of tax
Closed Group
2022
$’000
2,765,893
(813,928)
2021
$’000
(768,195)
224,281
1,951,965
(543,914)
(88)
26
(62)
(15,146)
4,544
(10,602)
Total comprehensive income/(loss) for the period, net of tax
1,951,903
(554,516)
Statement of financial position
Assets
Cash and cash equivalents
Trade and other receivables
Inventories
Derivatives
Total current assets
Trade and other receivables
Investments
Property, plant and equipment
Exploration and evaluation
Intangible assets
Derivatives
Total non-current assets
Total assets
1,215,375
659,392
157,039
31
95,117
156,096
175,930
-
2,031,837
427,143
7,298
856
3,426,550
647,289
12,180
74
11,785
37
3,330,116
613,508
11,828
-
4,094,247
3,967,274
6,126,084
4,394,417
Page 96 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
Statement of financial position
Liabilities
Trade and other payables
Interest-bearing liabilities
Employee benefits
Income tax payable
Provisions
Derivatives
Total current liabilities
Non-current liabilities
Other payables
Interest-bearing liabilities
Deferred tax liabilities
Provisions
Derivatives
Total non-current liabilities
Total liabilities
Net assets
Issued capital
Share-based payments reserve
Hedge reserve
Retained earnings
Equity
6.5. Related parties
Compensation to Executive KMP and Non-Executive Directors of the Group
Short-term employee benefits
Contributions to superannuation plans
Share-based compensation payments
Total compensation
Closed Group
2022
$’000
361,894
77,843
33,987
551,830
16,461
7,774
2021
$’000
231,265
75,116
31,926
-
18,423
3,485
1,049,789
360,215
48,464
166,854
405,169
242,516
104
863,107
1,912,896
4,213,188
2,639,938
14,867
(5,441)
1,563,824
4,213,188
2022
$’000
5,817
183
3,087
9,087
46,269
917,597
155,055
203,789
4,200
1,326,910
1,687,125
2,707,292
3,011,261
12,213
(5,379)
(310,803)
2,707,292
2021
$’000
5,052
172
2,028
7,252
Page 97 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
7. Other notes
7.1. Employee benefits
Consolidated statement of comprehensive income
Wages and salaries
Contributions to superannuation plans
Other associated personnel expenses
Increase in liability for annual leave
Increase in liability for long service leave
Share-based compensation payments
Consolidated statement of financial position
Salaries and wages accrued
Liability for long service leave
Liability for annual leave
2022
$’000
205,975
14,236
8,976
3,614
112
9,234
2021
$’000
189,259
13,223
6,432
1,542
19
6,995
242,147
217,470
7,832
449
25,706
33,987
9,497
337
22,092
31,926
Recognition and measurement
Wages, salaries, annual leave and sick leave
Liabilities for wages, salaries, annual leave and sick leave are recognised in respect of employees’ services up to the
reporting date. They are measured at the amounts expected to be paid when the liabilities are settled – that is, at
undiscounted amounts based on remuneration wage and salary rates including related on-costs, such as workers’
compensation insurance and payroll tax.
Long-term service benefits
Liabilities for long service leave and other long-term benefits are recognised and measured at the present value of
the estimated future cash outflows resulting from employees’ services provided up to the reporting date. Long-term
benefits not expected to be settled within twelve months are discounted using the rates attached to high quality
corporate bonds at the reporting date, which most closely match the maturity dates of the related liability.
Defined contribution superannuation funds
Obligations for contributions to defined contribution superannuation funds are recognised as an expense in the
consolidated statement of comprehensive income as incurred.
Page 98 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
7.2. Auditor’s Remuneration
Auditors of the Company - Ernst & Young (Australia)
Fees to the auditor for
Audit and review of statutory financial statements of the parent covering the Group
Audit of joint operations
Total audit services
Other assurance services where there is discretion as to whether the service is provided by the
auditor or another firm
Review of National Greenhouse and Energy Reporting Act 2007 requirements
Debt capital markets assurance services
Total other assurance services
Other services
Other non-audit services
Total other services
Total auditor’s remuneration
7.3. Commitments
a) Capital expenditure commitments
Contracted for but not provided for and payable:
Within one year1
1 There were no commitments for capital expenditure beyond one year.
2022
$
602,315
343,685
2021
$
573,028
326,972
946,000
900,000
115,000
209,741
324,741
-
-
60,000
-
60,000
-
-
1,270,741
960,000
2022
$’000
2021
$’000
42,598
10,027
Page 99 | Whitehaven Coal Annual Report 2022
Notes to the consolidated financial statements
For the year ended 30 June 2022
7.4. Contingencies
a) Bank guarantees
The Group provided bank guarantees to:
i)
ii)
iii)
iv)
v)
government departments as a condition of continuation of mining and exploration licences
rail capacity providers
port capacity providers
electricity network access supplier
other
2022
$’000
256,468
25,529
156,564
20,493
3,688
2021
$’000
276,330
29,339
137,046
22,470
3,367
462,742
468,552
b) Other
As previously reported, representative proceedings were commenced against the Group on 21 December 2018 in the
Supreme Court of Queensland by Nathan Tinkler as representative applicant. The proceedings were brought on behalf of
a number of parties who were issued with Milestone Shares (subject to restrictions on voting and transfer until various
development milestones are met) in Whitehaven Coal Limited in May 2012. The proceedings have since been transferred
to the Supreme Court of New South Wales and the representative applicant has been replaced by Les & Zelda
Investments Pty Ltd (ACN 148 907 573) as Trustee for the Les & Zelda Family Trust. The pleadings make various
allegations against the Group in relation to the Milestone Shares. The Group denies those allegations. The proceedings are
ongoing, and no trial date has yet been set.
Other than the above, there are a number of legal and potential claims against the Group that have arisen in the ordinary
course of business. The Group does not believe that these matters will result in any material adverse outcome based on
information currently available.
7.5. Subsequent events
In the interval between the end of the financial year and the date of this report there has not arisen any item, transaction
or event of a material or unusual nature likely, in the opinion of the Directors of the Company, to affect significantly the
operations of the Group, the results of those operations, or the state of affairs of the Group, in future financial years, other
than the following:
Subsequent to the end of the financial year, the Directors declared a fully franked final dividend of 40 cents per share
totalling $368.9 million to be paid on 16 September 2022.
John Conde has advised that he will not stand for re-election at the Company’s Annual General Meeting on 26 October
2022.
Page 100 | Whitehaven Coal Annual Report 2022
Directors’ declaration
Notes to the consolidated financial statements
For the year ended 30 June 2022
For the year ended 30 June 2022
In accordance with a resolution of the directors of Whitehaven Coal Limited, I state that:
In the opinion of the Directors:
(a) The financial statements and notes of Whitehaven Coal Limited are in accordance with the Corporations Act 2001
(Cth), including:
(i) Giving a true and fair view of the consolidated entity’s financial position as at 30 June 2022 and of its
performance for the year ended on that date, and
(ii) Complying with Australian Accounting Standards (including the Australian Accounting Interpretations) and
the Corporations Regulations 2001
(b) The financial statements and notes also comply with International Financial Reporting Standards as disclosed in
note 1
(c) There are reasonable grounds to believe that the Company will be able to pay its debts as and when they become
due and payable
(d) This declaration has been made after receiving the declarations required to be made to the Directors in accordance
with section 295A of the Corporations Act 2001 (Cth) for the financial year ending 30 June 2022
(e) As at the date of this declaration, there are reasonable grounds to believe that the members of the Closed Group
identified in note 6.4 will be able to meet any obligations or liabilities to which they are or may become subject, by
virtue of the Deed of Cross Guarantee.
On behalf of the Board
The Hon. Mark Vaile AO
Chairman
Paul Flynn
Managing Director
Sydney
25th August 2022
Page 101 | Whitehaven Coal Annual Report 2022
Independent Auditor’s report
Independent Auditor’s report
For the year ended 30 June 2022
For the year ended 30 June 2022
Page 102 | Whitehaven Coal Annual Report 2022
Independent Auditor’s report
For the year ended 30 June 2022
Page 103 | Whitehaven Coal Annual Report 2022
Independent Auditor’s report
For the year ended 30 June 2022
Page 104 | Whitehaven Coal Annual Report 2022
Independent Auditor’s report
For the year ended 30 June 2022
Page 106 | Whitehaven Coal Annual Report 2022
ASX additional information
Additional information required by the Australian Securities Exchange Limited Listing Rules and not disclosed elsewhere
in this report is set out below.
Shareholdings
Substantial shareholders
The number of shares recorded as owned by substantial shareholders and their associates in the most recent substantial
shareholder notices advised to the Company by these shareholders are set out below:
Shareholder
JPMorgan Chase & Co.
Dimensional Entities
Voting rights
Ordinary shares
Refer to note 5.4 in the financial statements
Options
There are no voting rights attached to the options.
Distribution of equity security holders
Category
1 - 1,000
1,001 - 5,000
5,001 - 10,000
10,001 - 100,000
100,001 and over
Percentage of
capital held
Number of ordinary
shares held
Date of substantial
shareholder notice
6.72%
5.08%
64,306,391
48,633,676
18 Aug 2022
12 Jul 2022
Number of equity security holders
% of Units
6,833
7,689
2,771
3,056
248
20,597
0.35
2.17
2.24
8.89
86.35
100.00
There are no holders of options over ordinary shares.
The number of shareholders holding less than a marketable parcel of ordinary shares is 468.
Page 107 | Whitehaven Coal Annual Report 2022
Securities exchange
The Company is listed on the Australian Securities Exchange.
Other information
Whitehaven Coal Limited, incorporated and domiciled in Australia, is a publicly listed company limited by shares.
Twenty largest shareholders (legal ownership)
Name
HSBC CUSTODY NOMINEES (AUSTRALIA) LTD
J P MORGAN NOMINEES AUSTRALIA PTY LIMITED
CITICORP NOMINEES PTY LTD
BNP PARIBAS NOMS PTY LTD
NEWECONOMY COM AU NOMINEES PTY LIMITED <900 ACCOUNT>
AET SFS PTY LTD
BNP PARIBAS NOMINEES PTY LTD
NATIONAL NOMINEES LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED - A/C 2
BRISPOT NOMINEES PTY LTD
WARBONT NOMINEES PTY LTD
BNP PARIBAS NOMINEES PTY LTD HUB24 CUSTODIAL SERV LTD
BNP PARIBAS NOMS PTY LTD
BNP PARIBAS NOMINEES PTY LTD
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED GSCO ECA
UBS NOMINEES PTY LTD
ECAPITAL NOMINEES PTY LIMITED
INVIA CUSTODIAN PTY LIMITED
HSBC CUSTODY NOMINEES (AUSTRALIA) LIMITED
NATIONAL NOMINEES LIMITED
This information is current as at 18 August 2022.
Number of
ordinary shares
held
Percentage of
capital held
174,060,388
173,735,018
168,680,027
58,282,858
28,775,901
26,678,979
22,903,567
22,672,308
21,126,181
7,972,428
5,967,895
5,652,370
5,121,828
4,704,189
4,409,572
4,212,567
3,195,786
3,100,889
2,959,602
2,697,760
746,910,113
18.20
18.17
17.64
6.09
3.01
2.79
2.40
2.37
2.21
0.83
0.62
0.59
0.54
0.49
0.46
0.44
0.33
0.32
0.31
0.28
78.11
Page 108 | Whitehaven Coal Annual Report 2022
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Page 109 | Whitehaven Coal Annual Report 2022
Measured
Resource
(A)
Indicated
Resource
(B)
Measured +
Indicated
(A + B)
Inferred
Resource
(C)
Competent
Person Report Date
Resources
and Reserves
Whitehaven Coal Limited – Coal Resources – August 2022
Tenement
Maules Creek
Open Cut*
Narrabri North
Underground**
Narrabri South
Underground**
Tarrawonga
Open Cut
Tarrawonga
Underground
Werris Creek
Open Cut
CL375 AUTH346
ML1701 ML1719
ML1609
EL6243
EL5967 ML1579
ML1685 ML1693
EL5967 ML1579
ML1685 ML1693
ML1563 ML1672
Rocglen Open Cut
ML1620
Rocglen
Underground
Vickery
Open Cut
Vickery
Underground
ML1620
CL316 EL4699 EL5831
EL7407 EL8224
ML1464 ML1471 ML1718
349
127
144
33
10
4.2
2
-
230
-
174
143
169
17
15
523
270
313
50
25
0.2
4.4
3
3
165
95
6
3
395
95
44
-
8
13
14
-
0.2
1
110
135
Winchester South
MDL 183
340
330
670
445
Gunnedah Open Cut
Gunnedah
Underground
ML1624 EL5183
CCL701
ML1624 EL5183
CCL701
Bonshaw Open Cut
EL6450 EL6587
Ferndale Open Cut
EL7430
Ferndale
Underground
Oaklands North
Open Cut
Pearl Creek
Open Cut***
Total Coal Resources
EL7430
EL6861
EPC862
7
2
-
103
-
110
-
1462
47
138
4
135
-
260
15
1713
54
140
4
238
-
89
24
7
134
73
370
580
15
3175
33
1710
1. Darryl Stevenson, 2. Jorham Contreras, 3. Benjamin Thompson, 4. Troy Turner.
* Maules Creek Joint Venture - Whitehaven owns 75% share.
** Narrabri Joint Venture - Whitehaven owns 77.5% share.
*** Dingo Joint Venture - Whitehaven owns 70% share.
# The Coal Resources for active mining areas are current to the pit surface as at the report date.
Note: Figures reported are rounded which may result in small tabulation errors.
Page 110 | Whitehaven Coal Annual Report 2022
1
2
2
3
3
3
3
3
2
2
4
3
3
3
3
3
3
3
Mar-22
Mar-22
Mar-22
Mar-22
Apr-14
Mar-22
Mar-19
Mar-15
Jul-15
Jul-15
Apr-22
Jun-14
Jun-14
Jun-14
Jan-13
Jan-13
Jun-14
Aug-20
Whitehaven Coal Limited – Coal Reserves – August 2022
Tenement
Proved
Probable
Total
Proved
Probable
Total
Recoverable Reserves
Marketable Reserves
Competent
Person
300
120
420
260
100
370
Maules Creek
Open Cut*
CL375
AUTH346
Narrabri North
Underground**
Narrabri South
Underground**
ML1609
EL6243
Tarrawonga
Open Cut
EL5967 ML1579
ML1685 ML1693
64
92
18
Werris Creek
Open Cut
ML1563 ML1672
3.3
5
5
9
-
69
97
27
64
90
15
3.3
3.3
4
6
7
-
Vickery Open Cut
CL316 EL4699
EL7407
-
200
200
-
178
Winchester South
MDL 183
270
110
380
160
Rocglen Open Cut
ML1620
-
-
-
-
55
-
TOTAL COAL RESERVES
747
449
1196
592
350
1. Doug Sillar, 2. James Smith.
67
96
22
3.3
178
215
-
951
Report
Date
Mar-22
Mar-22
Mar-22
Mar-22
Mar-22
Mar-15
Apr-22
1
2
2
1
1
1
1
1
* Maules Creek Joint Venture - Whitehaven owns 75% share. Recoverable Reserves for the Maules Creek open cut mine include approximately 30Mt of coal
located in an area identified in the mine’s project approvals as a vegetated buffer corridor between the mine and the neighbouring Boggabri mine. These
project approvals require a suitable alternate corridor to be approved prior to mining of the coal in this corridor. The company is progressing work on potential
alternatives to this corridor in conjunction with the owners of the Boggabri mine.
** Narrabri Joint Venture - Whitehaven owns 77.5% share.
# The Coal Reserves for active mining areas are current as at report date.
## Coal Reserves are quoted as a subset of Coal Resources.
### Marketable Reserves are based on geological modeling of the anticipated yield from Recoverable Reserves.
Note: Figures reported are rounded which may result in small tabulation errors.
Information in this report that relates to Coal Resources and Coal Reserves is based on and accurately reflects
reports prepared by the competent person named beside the respective information. Darryl Stevenson,
Jorham Contreras and Benjamin Thompson are all geologists with Whitehaven Coal. Troy Turner is a full time
employee of Xenith Consulting Pty Ltd. Doug Sillar is a full time employee of RPM Advisory Services Pty Ltd.
James Smith is a full time employee of Palaris Australia Ltd.
Named competent persons consent to the inclusion of material in the form and context in which it appears. All
competent persons named are Members of the Australasian Institute of Mining and Metallurgy and/or The Australian
Institute of Geoscientists. They have the relevant experience in relation to reporting on mineralisation to qualify as
competent persons as defined in the Australian Code for Reporting of Exploration Results, Mineral Resources and
Ore Reserves (The JORC Code, 2012 edition).
Page 111 | Whitehaven Coal Annual Report 2022
Glossary
ARTC
Australian Rail Track Corporation
ASEAN
Association of Southeast Asian Nations
bcm
CHPP
CV
Bank cubic metre
Coal Handling Preparation Plant
Calorific value
EBITDA
Earnings Before Interest, Taxation, Depreciation and Amortisation
ECA
FEC
FOB
Export Credit Agency
Forward Exchange Contract
Free-on-Board
FVLCD
Fair Value Less Costs of Disposal
FY21
FY22
HELE
JORC
Financial Year ending 30 June 2021
Financial Year ending 30 June 2022
High Energy Low Emissions
Joint Ore Resources Committee
Kcal/kg
Kilo calories per kilogram
KMP
Key Management Personnel
KPI
kt
LTI
LW
m
Mt
MTI
Mtpa
NAR
NCIG
NPAT
PWCS
ROM
SIP
STI
t
TFR
TRIFR
TSR
Key Performance Indicator
Thousand tonnes
Long-Term Incentive
Longwall
Million
Million tonnes
Medium-Term Incentive
Million tonnes per annum
Net As Received basis
Newcastle Coal Infrastructure Group
Net profit after tax
Port Waratah Coal Services
Run-of-Mine
Single Incentive Plan
Short-Term Incentive
Tonne
Total Fixed Remuneration
Total Recordable Injury Frequency Rate
Total Shareholder Return
VWAP
Volume weighted average price
Page 109 | Whitehaven Coal Annual Report 2022
Corporate directory
Directors
The Hon. Mark Vaile AO
Chairman
John Conde AO
Deputy Chairman
Dr Julie Beeby
Non-Executive Director
Paul Flynn
Managing Director and CEO
Lindsay Ward
Non-Executive Director
Fiona Robertson
Non-Executive Director
Raymond Zage
Non-Executive Director
Company Secretary
Timothy Burt
Registered and Principal
Administrative Office
Level 28, 259 George Street
Sydney NSW 2000
P +61 2 8222 1100
F +61 2 8222 1101
Australian Business Number
ABN 68 124 425 396
Stock Exchange Listing
Australian Securities
Exchange Limited
ASX Code: WHC
Auditor
Ernst & Young
Ernst & Young Centre
Level 34, 200 George Street
Sydney NSW 2000
P +61 2 9248 5555
F +61 2 9248 5959
Share Registry
Computershare Investor
Services Pty Limited
GPO Box 2975 Melbourne
Victoria 3001 Australia
P 1300 855 080
(or +61 3 9415 4000)
Country of Incorporation
Australia
Web address
www.whitehavencoal.com.au
Page 110 | Whitehaven Coal Annual Report 2022
Whitehaven Coal
Level 28, 259 George Street
Sydney NSW 2000
P +61 2 8222 1100
ASX Code: WHC
whitehavencoal.com.au