Hyakugo Bank Ord Shs HYKUF

Q1 2023

[Creemore77]

"Metallurgical coal selling prices are expected to be meaningfully higher than the fourth quarter of 2022 as we recognize the higher sales prices of our 2023 fixed price contracts and increase our participation in the metallurgical coal spot market. Cash cost of sales are expected to be lower than the previous quarter as mining conditions and efficiencies are improved but will remain elevated compared to historical levels."

this seems really important as the story of the last couple of years was that fixed price contracts gave us less than market prices and costs were high for non-recurring reasons.  In 2022 we lost $30MM on 1MM tons.  Say the 1MM tons is easy for 2023.  The forward of around $300/tonne is about $80/tonne higher than realized in 2022. There's a strong suggestion that $10 or $20 per ton cost savings over a bad year is possible.  So a potential swing of up to $100MM in earnings.Discount by half that gives $20MM earnings.  Do the '2023 fixed price contracts' cap that upside? The statement isn't definite but certainly suggests some upside. Also the reference to spot is helpful.  Also suggests we don't need to wait for Q4 2023 results to see a trend.  

But my main reason for being here is to offend ESG investors.