Whitehaven Coal, New Hope Corporation, and Coronado benefit from a coal bounce

Companies exposed to the rebounding price for coal and global demand for lithium dominated the best-performing stocks on the ASX 200 in 2022.

Coronado Global Resources ended the year with market capitalisation growth of 94 per cent. Picture: Bloomberg

Fossil fuel and lithium companies dominated the best-performing stocks on the ASX 200 in 2022, in news that will come as no surprise to anyone who paid the slightest attention to global commodity markets.

Two years ago, Australian coal miners were facing disaster. China’s ban on Australian coal imports had disrupted the market for many companies, coal prices were low and many ASX-listed companies were laden with debt at a time when it was becoming increasingly difficult to find lenders to back the sector.

But now the situation is all but reversed. Soaring coal prices — first metallurgical, then thermal — helped Whitehaven Coal, New Hope Corporation, and Coronado Global Resources pay off lenders and replenish their coffers enough to let loose a flood of shareholder returns in the form of dividends and buybacks.

On a total return basis — including dividend payments — Whitehaven easily topped the list of best-performing companies on the ASX 200, delivering a total gain for shareholders of 260.9 per cent, according to figures drawn from Bloomberg. Its market capitalisation rose 261 per cent.

New Hope came in second, with a total return of 185.2 per cent. It delivered a $983m annual profit, handed at a 56c a share final dividend, and has a $300m share buyback under way.

Whitehaven delivered a $2bn net profit for the year. It handed shareholders a 40c final dividend and following its November annual meeting started a $2bn buyback scheme which was one of the biggest on record on the Australian market as a proportion of its own issued capital.

The coal sector’s contribution was rounded out by the 60.5 per cent total return from coking coal miner Coronado, which ended the year as the fifth-best performer with market capitalisation growth of 94 per cent.

Woodside’s acquisition of BHP’s oil and gas assets could not have been better timed, given surging LNG prices through the year. High commodity prices helped the company brush aside any lingering concerns about finding the cash to back its capital spending plans, as the company pushes ahead with construction of its Scarborough gas project in WA.

Woodside won’t announce the scale of its annual profits until February, but the company delivered a 61.6 per cent annual return to shareholders for the year, including a $1.60-a-share interim dividend.

Origin Energy finished in sixth place with a 47.3 per cent return in a year that could be its last on the ASX, given it is the subject of an $18.4bn takeover offer from Canadian asset manager Brookfield and US-based energy investor EIG.

But companies involved in “future facing” commodities also had a good year, as the lithium price surge rivalled that of fossil fuels.

Core Lithium waved farewell to its first shipment of direct shipping ore on Friday. The first 15,000 tonnes of 1.4 per cent ore were loaded at a Darwin dock before the ship sailed for China, as the company finishes work on its Finniss lithium mine in the Northern Territory.

Core Lithium said it expected to ship concentrate by the end of June. It finished 2022 having boosted the value of its stock by 73.7 per cent for the year.

Emerging North American lithium play Sayona Mining finished in seventh place, with a 46.2 per cent return and the company closed 2022 worth $1.55bn.

Chris Ellison’s Mineral Resources finished in 10th place. Its lithium assets in WA were the main focus for the market, despite strong supporting performances from its iron ore and mining services businesses. MinRes delivered a total market return of 37.9 per cent, and finished 2022 worth $14.5bn.

If there were any surprises in the final tally, it was the entry of two mining and energy services companies to the top 10. The year was a tough one for many contractors due to struggles with fixed-price contracts, rising labour and input costs, and shortages of skilled workers in critical areas – as seen by the collapse of WA contractor Clough.

But Worley and Monadelphous Group defied the odds, finishing in eighth and ninth place with a 41.1 per cent and 38.5 per cent return respectively.