The New Hope Corporation Ltd (ASX: NHC) share price crashed 11.80% lower on the ASX yesterday after the company posted its first-half results for 2019. It's not looking much better this morning, with the share price down a further 5.4% to $3.68 in early trade.
What happened in the first half?
New Hope's underlying net profit after tax (NPAT) rose 33% on prior corresponding period (pcp) to $160 million on 4.5 million tonnes sold during the half-year.
Underlying earnings before interest, tax, depreciation and amortisation (EBITDA) rose 31% on pcp to $285 million while management also increased the dividend by 33% to 8 cents per share (cps). But the numbers weren't so rosy on a statutory basis.
The Aussie coal miner continues to face headwinds arising from uncertainty in energy policy and ongoing environmental concerns facing the coal mining industry.
Management said it expects to make a final decision on the re-opening of the Burton coal mine, next to the company's existing Lenton site, by the end of the year as it continues to arrange port and rail infrastructure access.
Slowing growth appears to be the biggest catalyst for the New Hope share price freefall but still remains ahead of the S&P/ASX200 Index (ASX: XJO) so far this year.
What's the verdict on New Hope?
While New Hope's growth in recent years has been impressive, I wouldn't be buying the company's shares just yet.
The major risk I see facing New Hope is the phase-out of coal as a primary energy source in Australia and particularly brownfield investments that the company remains heavily invested in.
With the possibility of a Federal Labor government being in power in the second half of the year, and a likely tilt towards more clean energy options as a result, I think New Hope's future growth prospects could be limited.
The Yancoal Australia Ltd (ASX: YAL) share price is broadly flat so far this year at $3.82 per share while the Whitehaven Coal Ltd (ASX: WHC) share price has performed even worse, down 5% at $4.10 per share.
If you're similarly bearish on coal, I'd be taking a look at these top growth shares which we think could be the perfect fit for a diversified portfolio in 2019.
