Fortescue shares up on iron ore beat; scraps US, Aussie green hydrogen projects
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Fortescue shares up on iron ore beat; scraps US, Aussie green hydrogen projects
Australia’s Fortescue posts record fourth quarter iron ore shipments on lower costs. Miner also says it will scrap its U.S. and Australian green hydrogen projects. Shares of the Perth-based company were up more than 5.3%, as of 0122 GMT, as the broader mining sub-index dropped 0.6%.Fortescue, chaired by billionaire founder Andrew Forrest, shipped 198.4 Mt of iron ore in fiscal 2025 – its highest on record – touching the top end of its 190–200 Mt annual guidance. The world’s fourth largest iron ore miner forecast metals capital expenditure of $3.3 billion to $4 billion in fiscal 2026.
Companies Fortescue shares up 5% as it ships record iron ore
Miner cuts two green energy projects, linked spending
Miner likely able to meet dividend payout ratio, analyst says
MELBOURNE, July 24 (Reuters) – Shares in Australia’s Fortescue (FMG.AX) , opens new tab rose on Thursday after the miner posted record fourth quarter iron ore shipments on lower costs, beating analyst expectations, and said it would scrap its U.S. and Australian green hydrogen projects.
Costs fell to the lowest per unit since 2020, and Fortescue also forecast record production again for next year.
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Abandoning the Queensland and Arizona projects also allowed the mining giant to trim its spending plans, raising the prospect it could maintain its dividend payout ratio at its full year results on August 25, said Glyn Lawcock, an analyst with Barrenjoey in Sydney.
“It was an incredibly strong quarter. Costs exceptionally low … We haven’t seen them down at that level for a long time. There was a bit of fear in the market that capex could be a lot higher than it was,” he added.
The mining giant posted stronger-than-expected quarterly iron ore shipments of 55.2 million metric tons (Mt), up from 53.7 Mt a year earlier.
Fortescue, chaired by billionaire founder Andrew Forrest, shipped 198.4 Mt of iron ore in fiscal 2025 – its highest on record – touching the top end of its 190–200 Mt annual guidance.
Shares of the Perth-based company were up more than 5.3%, as of 0122 GMT, as the broader mining sub-index dropped 0.6%.
Fortescue said it was assessing options to repurpose the assets and land for the Arizona Hydrogen Project and the PEM50 Project in Gladstone, Australia. It expects a preliminary pre-tax writedown of about $150 million in its second-half results, linked to spending on those businesses. USD
The world’s fourth largest iron ore miner forecast metals capital expenditure of $3.3 billion to $4 billion in fiscal 2026 and flagged capital expenditure of $3.9 billion for fiscal year 2025. For its energy business, operating expenses stood at $400 million, below $700 million forecast.
“I think the market is pleased to see a meaningful reduction in energy spend,” Lawcock added.
The mining giant expects higher iron ore shipments for the fiscal year ending June 2026 of between 195 million and 205 million metric tons, including 10 million to 12 million tons for Iron Bridge on a 100% basis.
Iron Bridge is Fortescue’s magnetite operation, located in Western Australia’s Pilbara region. In May, Fortescue flagged a three-year delay to full ramp up of 22 million tonnes per year to fiscal 2028.
Reporting by Roshan Thomas and Rajasik Mukherjee in Bengaluru, Melanie Burton in Sydney; Editing by Devika Syamnath and Kate Mayberry
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