Thungela sees strong turnaround as coal prices and rail flows improve

Cape Town – South Africa’s largest producer of export coal, Thungela Resources, has reported a sharp improvement in its financial performance for the six months to June 2026, helped by stronger international coal prices and improved rail logistics.

According to News24, Thungela’s headline earnings per share surged by 150%, while net profit increased more than fivefold compared with the first half of 2025.

The stronger performance came despite relatively stable South African production.

Thungela had previously forecast about 6.3 million tons of export saleable coal from its South African operations during the first half, compared with 6.4 million tons a year earlier.

Across its South African and Australian operations, total export saleable production was expected to reach 8.3 million tonnes, up 4% year on year, according to Financial Filings.

Higher coal prices boost earnings

Coal prices provided a major boost. Thungela said the Richards Bay benchmark averaged $104.25 per ton during the first five months of 2026, compared with $89.53 in its 2025 financial year. The Newcastle benchmark averaged $124.79 per ton, up from $105.37, Business Day reported.

Thungela’s average realised export price through the Richards Bay Coal Terminal rose to $87.60 per ton, although this remained about 16% below the benchmark because the company sold a greater proportion of lower-quality coal from stockpiles.

Rail improvements help exports

Improved performance by Transnet Freight Rail was another key factor. Thungela expected South African export sales of about 7.5 million tonnes in the first half, compared with 6.6 million tonnes a year earlier.

The company said rail performance had reached an annualised rate of about 60.8 million tonnes, allowing more coal to reach export terminals.

This represents a significant improvement from 2025, when Transnet Freight Rail’s coal volumes increased to 56.8 million tonnes from 51.9 million tonnes in 2024.

Stronger sales and cash position

Thungela’s total export sales were forecast at 9.5 million tons, up 12% from 8.5 million tonnes in the first half of 2025. The increase included higher South African and Australian sales as well as a substantial increase in third-party coal sales.

The company also expected to finish June with net cash of between R5.9 billion and R6.1 billion, including about R1 billion generated from foreign-exchange derivatives. It maintained its policy of paying shareholders at least 30% of adjusted operating free cash flow in dividends.

The bigger picture

The results mark a significant turnaround from Thungela’s difficult 2025 financial year, when weaker coal prices contributed to an R8.8 billion non-cash impairment and the company reported a loss for the year.

The latest results therefore show how much Thungela’s fortunes remain tied to global coal prices, export logistics and the rand-dollar exchange rate. While production growth was modest, better prices and improved rail access enabled the company to sell more coal and generate substantially stronger earnings.