QUARTERLY REPORT 
September 2024
South32 Chief Executive Officer, Graham Kerr:
"We were devastated by the loss of Mr José Luis
Pérez, who was fatally injured in an incident at Cerro Matoso on 17
September and we express our sincere and deepest sympathies to his
family, friends and colleagues.
"We remain committed to improving our safety performance. We
continue to implement our Safety Improvement Program, which will
help us to achieve a step change in our performance so that
everyone goes home safe and well every day.
"We have maintained annual production guidance for all of our
operations with a strong start to the year in aluminium and a 20
per cent uplift in copper equivalent volumes from Sierra
Gorda.
"Completing the sale of Illawarra Metallurgical Coal is a
major milestone in our portfolio transformation which has unlocked
significant value and streamlined our business toward commodities
critical for a low-carbon future.
"The sale has also lowered our sustaining capital intensity
and strengthened our financial position, enabling us to self fund
our growth in base metals and deliver returns to shareholders via
our on-market share buy-back.
"At Hermosa, construction of our large-scale, long-life Taylor
zinc-lead-silver project is progressing as planned and we are
continuing to unlock value across our broader land
package.
"During the quarter, Hermosa was selected for a US$166 million
award negotiation from the US Department of Energy, which
recognises Clark's potential to supply battery-grade manganese for
the emerging North American market.
"Our transformed portfolio, focused on copper, zinc and our
aluminium value chain, leaves us well placed to capitalise on the
global energy transition and stronger market conditions to start
the
year."
|
·
|
Completed the sale of Illawarra
Metallurgical Coal and received upfront cash proceeds of
US$964M1.
|
|
·
|
Expanded our capital management
program by US$200M and commenced our on-market share
buy-back.
|
|
·
|
Maintained FY25 production guidance
for all operations.
|
|
·
|
Aluminium production increased by 5%
as Hillside Aluminium continued to test its maximum technical
capacity, and low-carbon aluminium2 production from
Brazil Aluminium and Mozal Aluminium increased by 12%.
|
|
·
|
Worsley Alumina saleable production
declined by 7% as planned calciner maintenance was undertaken and
we managed constrained bauxite supply. The Western Australian
Environment Minister is expected to consider approval of new
bauxite mining areas in December 2024, with Federal approvals
expected shortly thereafter.
|
|
·
|
Brazil Alumina saleable production
was largely unchanged as plant availability continued to improve. A
preliminary environmental license for the
MRN West Zone mine life extension project was issued during the
September 2024 quarter.
|
|
·
|
Sierra Gorda payable copper
equivalent production3 increased by 20% due to higher
planned copper grades and a significant increase in molybdenum
recoveries as a result of improved ore quality.
|
|
·
|
Cannington payable zinc equivalent
production4 declined by 34% due to challenging ground
conditions, resulting in the deferral of a higher grade stope to
the December 2024 quarter.
|
|
·
|
South Africa Manganese production
increased by 12% as the operation delivered strong mining
performance and continued to sell secondary products to maximise
margins.
|
|
·
|
Australia Manganese continued a
substantial dewatering program and remains on track to resume
production in the December 2024 quarter. Initial external
insurance recoveries of US$100M (100%
basis) were received during the quarter.
|
|
·
|
Continued construction of Hermosa's
Taylor zinc-lead-silver project as planned. Clark was selected for
a US$166M award negotiation from the US
Department of Energy for a potential commercial-scale battery-grade
manganese facility5.
|
|
·
|
Entered into a strategic alliance to
explore for copper in the Kalahari copper belt in Namibia and an
earn-in agreement for a zinc-lead-silver prospect in Nevada,
USA.
|
|
Production summary
|
|
|
|
|
|
|
|
|
|
South32 share
|
YTD FY24
|
YTD FY25
|
YoY
|
|
1Q24
|
4Q24
|
1Q25
|
QoQ
|
|
Alumina production (kt)
|
1,290
|
1,184
|
(8%)
|
|
1,290
|
1,249
|
1,184
|
(5%)
|
|
Aluminium production (kt)
|
288
|
298
|
3%
|
|
288
|
285
|
298
|
5%
|
|
Payable copper production
(kt)
|
16.0
|
17.6
|
10%
|
|
16.0
|
15.3
|
17.6
|
15%
|
|
Payable silver production
(koz)
|
3,375
|
2,066
|
(39%)
|
|
3,375
|
3,224
|
2,066
|
(36%)
|
|
Payable lead production
(kt)
|
28.5
|
19.3
|
(32%)
|
|
28.5
|
28.8
|
19.3
|
(33%)
|
|
Payable zinc production
(kt)
|
13.2
|
12.1
|
(8%)
|
|
13.2
|
17.4
|
12.1
|
(30%)
|
|
Payable nickel production
(kt)
|
8.3
|
8.6
|
4%
|
|
8.3
|
11.5
|
8.6
|
(25%)
|
|
Manganese ore production
(kwmt)
|
1,518
|
597
|
(61%)
|
|
1,518
|
534
|
597
|
12%
|
|
Unless otherwise noted: percentage
variance relates to performance during the September 2024 quarter
compared with the September 2023 quarter (YoY), or the September
2024 quarter compared with the June 2024 quarter (QoQ); production
and sales volumes are reported on an attributable basis.
|
|
|
|
|
|
|
|
|
|
|
CORPORATE UPDATE
Safety
|
·
|
On 17 September 2024, Mr José Luis
Pérez was fatally injured in an incident at Cerro Matoso, our
ferronickel operation in Colombia. Our deepest sympathies are with
Mr Pérez's family and colleagues to whom we are providing support
and counselling. An investigation into the incident is underway and
we are engaging with the relevant authorities.
|
|
·
|
We remain united by our belief that
everyone can go home safe and well every day. We are continuing to
implement our global multi-year Safety Improvement Program to
deliver improved safety performance, including investment in safety
leadership through our LEAD Safely Every Day Program which has been
completed by more than 1,500 leaders, employees and contractors in
our business.
|
Sustainability
|
·
|
Worsley Alumina achieved performance
standard certification against the Aluminium Stewardship Initiative
(ASI), a certification organisation which aims to foster
responsible production, sourcing and stewardship of
aluminium. With Mozal Aluminium also having ASI
certification, we can now deliver aluminium with full value chain
certification from the mining and refining
of bauxite to alumina at Worsley Alumina, to the production
of aluminium at Mozal Aluminium.
|
Portfolio
|
·
|
On 29 August 2024, we completed the
sale of Illawarra Metallurgical Coal (the Transaction) to an entity
owned by Golden Energy and Resources Pte Ltd and M Resources Pty
Ltd, receiving upfront cash proceeds of US$964M1.
The total Transaction consideration also includes deferred cash
consideration of US$250M, payable in March 2030, and contingent
price-linked cash consideration of up to
US$350M6.
|
|
·
|
On 12 August 2024, we completed the
sale of our 50% interest in the Eagle Downs metallurgical coal
project to a subsidiary of Stanmore Resources Limited, for
US$18M7 in cash, a contingent payment of
US$20M8 and a price-linked royalty of up to
US$100M9.
|
Financial
|
·
|
Net debt10 decreased by
US$723M to US$39M in the September 2024 quarter as we completed the
sale of Illawarra Metallurgical Coal, continued our investment in
growth at Hermosa, and experienced a temporary build in working
capital.
|
|
·
|
Working capital increased by
approximately US$150M during the September 2024 quarter, primarily
related to a temporary increase in work in progress and finished
goods inventories in our aluminium value chain.
|
|
·
|
We provided funding of US$63M to our
manganese equity accounted investment (EAI) during the September
2024 quarter to support the operational recovery plan at Australia
Manganese following the impacts of Tropical Cyclone
Megan.
|
|
·
|
Our manganese EAI received initial
recoveries of US$100M (100% basis) from external insurers and a
one-off recovery of US$50M (100% basis) under the Group's captive
insurance program during the September 2024 quarter. We are
continuing to work with our insurers to assess the timing and value
of further recoveries under property damage and business
interruption policies.
|
|
·
|
We received net
distributions11 of US$32M (South32 share) from our
Sierra Gorda EAI during the September 2024 quarter, with a further
distribution anticipated in the December 2024
quarter.
|
|
·
|
We invested US$135M in Group capital
expenditure (excluding EAIs and Hermosa) during the September 2024
quarter, including US$57M at Illawarra Metallurgical Coal prior to
completion of the Transaction.
|
|
·
|
We made Group tax payments of US$47M
(excluding EAIs) during the September 2024 quarter.
|
|
·
|
Reflecting our strengthened
financial position and disciplined approach to capital allocation,
we expanded our capital management program by US$200M, and
commenced our on-market share buy-back in September 2024. We spent
US$3M purchasing 1M shares at an average price of A$3.26 per share
in September 2024, leaving US$197M remaining to be returned to
shareholders ahead of extension or expiry of the program on 12
September 202512.
|
|
·
|
Following the end of the September
2024 quarter, we paid a fully-franked ordinary dividend of US$140M
in respect of the June 2024 half year.
|
DEVELOPMENT AND EXPLORATION
UPDATE
Hermosa project
|
·
|
We invested US$123M in growth
capital expenditure at Hermosa during the September 2024
quarter, as we progressed construction of
the Taylor zinc-lead-silver project and an exploration decline for
the Clark battery-grade manganese deposit.
|
|
·
|
All critical path dewatering wells
for both Taylor and Clark were commissioned during the September
2024 quarter.
|
|
·
|
Construction of Taylor progressed as
planned. The main shaft headframe has been completed and
commissioning of the hoisting system for the ventilation shaft is
underway. Shaft sinking is on track to commence in the December
2024 quarter.
|
|
·
|
Clark was selected for an award
negotiation of up to US$166M from the US Department of Energy under
the Battery Materials Processing and Battery Manufacturing
program5, to support the potential development of a
commercial-scale battery-grade manganese production
facility.
|
|
·
|
We directed US$7M to capitalised
exploration during the September 2024 quarter as we continued to
test the potential for a continuous copper system connecting Peake
and Taylor Deeps.
|
Greenfield exploration
|
·
|
We invested US$7M in our greenfield
exploration opportunities during the September 2024 quarter as we
progressed multiple exploration programs targeting base metals in
Australia, USA, Canada, Argentina and Ireland.
|
|
·
|
We added to our portfolio of
prospective exploration options, forming a strategic alliance with
Noronex Limited to explore for copper in the Kalahari copper belt
in Namibia, and signed an earn-in agreement with Ridgeline Minerals
for the Selena zinc-lead-silver carbonate replacement deposit style
prospect in Nevada, USA.
|
Other exploration
|
·
|
We invested US$15M (US$13M
capitalised) in exploration programs at our existing operations and
development options during the September 2024 quarter, including
US$7M at the Hermosa project (noted above, all capitalised), US$3M
for our Sierra Gorda EAI (all capitalised) and US$2M for our
manganese EAI (nil capitalised).
|
PRODUCTION SUMMARY
|
Production guidance (South32 share)
|
|
|
|
|
|
|
|
FY24
|
YTD FY25
|
FY25e(a)
|
%(b)
|
Comments
|
|
Worsley Alumina
|
|
|
|
|
|
|
Alumina production (kt)
|
3,777
|
850
|
3,750
|
23%
|
Planned calciner maintenance in Q1
FY25
|
|
Brazil Alumina (non-operated)
|
|
|
|
|
|
|
Alumina production (kt)
|
1,286
|
334
|
1,350
|
25%
|
|
|
Brazil Aluminium (non-operated)
|
|
|
|
|
|
|
Aluminium production (kt)
|
104
|
30
|
130
|
23%
|
Smelter continues to ramp-up in
accordance with
guidance
|
|
Hillside Aluminium13
|
|
|
|
|
|
|
Aluminium production (kt)
|
720
|
180
|
720
|
25%
|
|
|
Mozal Aluminium13
|
|
|
|
|
|
|
Aluminium production (kt)
|
314
|
88
|
360
|
24%
|
|
|
Sierra Gorda (non-operated)
|
|
|
|
|
|
|
Payable copper equivalent production
(kt)3
|
73.5
|
22.1
|
84.8
|
26%
|
|
|
Payable copper production
(kt)
|
60.8
|
17.6
|
70.0
|
25%
|
|
Payable molybdenum production
(kt)
|
0.9
|
0.4
|
1.3
|
31%
|
|
Payable gold production
(koz)
|
24.6
|
7.7
|
25.0
|
31%
|
|
Payable silver production
(koz)
|
607
|
151
|
550
|
27%
|
|
Cannington
|
|
|
|
|
|
|
Payable zinc equivalent production
(kt)4
|
302.5
|
50.7
|
265.4
|
19%
|
Challenging ground conditions in Q1
FY25
Higher metal grades and throughput
expected across the remainder of FY25
|
|
Payable silver production
(koz)
|
12,666
|
1,915
|
11,300
|
17%
|
|
Payable lead production
(kt)
|
112.4
|
19.3
|
100.0
|
19%
|
|
Payable zinc production
(kt)
|
60.7
|
12.1
|
50.0
|
24%
|
|
Cerro Matoso
|
|
|
|
|
|
|
Payable nickel production
(kt)
|
40.6
|
8.6
|
35.0
|
25%
|
|
|
Australia Manganese
|
|
|
|
|
|
|
Manganese ore production
(kwmt)
|
2,324
|
-
|
1,000
|
N/A
|
On track to resume production in Q2
FY25
|
|
South Africa Manganese
|
|
|
|
|
|
|
Manganese ore production
(kwmt)
|
2,175
|
597
|
2,000
|
30%
|
|
|
Illawarra Metallurgical Coal14
|
|
|
|
|
|
|
Total coal production
(kt)
|
4,938
|
766
|
N/A
|
N/A
|
Results represent ownership period
July to August 2024
|
|
Metallurgical coal production
(kt)
|
4,305
|
676
|
N/A
|
N/A
|
|
Energy coal production
(kt)
|
633
|
90
|
N/A
|
N/A
|
a. The
denotation (e) refers to an estimate or forecast year.
b. Reflects
percentage of achieved production for YTD FY25 compared to current
FY25e.
s
WORSLEY ALUMINA (86%
SHARE)
|
South32 share
|
YTD FY24
|
YTD FY25
|
YoY
|
|
1Q24
|
4Q24
|
1Q25
|
1Q25
vs
1Q24
|
1Q25
vs
4Q24
|
|
Alumina production (kt)
|
972
|
850
|
(13%)
|
|
972
|
916
|
850
|
(13%)
|
(7%)
|
|
Alumina sales (kt)
|
913
|
824
|
(10%)
|
|
913
|
974
|
824
|
(10%)
|
(15%)
|
Worsley Alumina saleable production
decreased by 7% (or 66kt) to 850kt in the September 2024 quarter as
planned calciner maintenance was undertaken, and we managed
constrained bauxite supply due to delayed approvals for new mining
areas. FY25 production guidance remains unchanged at 3,750kt with
the refinery to convert excess hydrate stocks to calcined alumina
across the remainder of the year.
Sales decreased by 15% in the
September 2024 quarter due to lower product availability and the
timing of shipments. We realised a circa 8% discount to the
Platts Alumina index15 on a volume weighted M-1 basis
for alumina sales in the September 2024 quarter, which reflected
market based prices with the exception of a legacy supply contract
with Mozal Aluminium which is linked to the LME aluminium
price.
On 8 July 2024, the Western
Australian Environmental Protection Authority (WA EPA) published
its recommendation that the Worsley Mine Development Project (the
Project) be approved, subject to conditions. If imposed in their
current form, several conditions would create significant operating
challenges. We have lodged an appeal in relation to the WA EPA
assessment report.
On 15 October 2024, the Western
Australian State Government announced that it would defer
regulation of greenhouse gas emissions to the Federal Government's
Safeguard Mechanism. The change will remove policy inconsistencies
that currently exist between the State and Federal Government with
regard to greenhouse gas emissions, and is expected to be addressed
as part of the appeals process for the Project.
We continue to work collaboratively
with the Western Australian Government to enable Worsley Alumina to
continue to meet the State's robust environmental standards. The
Western Australian Environment Minister is expected to consider
approval of the Project in December 2024, with required Federal
approvals expected shortly thereafter.
BRAZIL ALUMINA (36% SHARE,
NON-OPERATED)
|
South32 share
|
YTD FY24
|
YTD FY25
|
YoY
|
|
1Q24
|
4Q24
|
1Q25
|
1Q25
vs
1Q24
|
1Q25
vs
4Q24
|
|
Alumina production (kt)
|
318
|
334
|
5%
|
|
318
|
333
|
334
|
5%
|
0%
|
|
Alumina sales (kt)
|
272
|
326
|
20%
|
|
272
|
358
|
326
|
20%
|
(9%)
|
Brazil Alumina saleable production
was largely unchanged at 334kt in the September 2024 quarter as the
refinery continued to benefit from improved plant availability.
FY25 production guidance remains unchanged at 1,350kt.
A preliminary environmental license
for MRN's West Zone project, which has the potential to extend the
life of the bauxite mine by more than 20 years16, was
issued during the September 2024 quarter. A final investment
decision for an enabling transmission line to connect MRN to the
Brazilian power grid is expected during the December 2024
quarter.
BRAZIL ALUMINIUM (40% SHARE,
NON-OPERATED)
|
South32 share
|
YTD FY24
|
YTD FY25
|
YoY
|
|
1Q24
|
4Q24
|
1Q25
|
1Q25
vs
1Q24
|
1Q25
vs
4Q24
|
|
Aluminium production (kt)
|
24
|
30
|
25%
|
|
24
|
28
|
30
|
25%
|
7%
|
|
Aluminium sales (kt)
|
8
|
25
|
213%
|
|
8
|
30
|
25
|
213%
|
(17%)
|
Brazil Aluminium saleable production
increased by 7% (or 2kt) to 30kt in the September 2024 quarter as
the smelter continued to ramp-up all three potlines. FY25
production guidance remains unchanged at 130kt.
HILLSIDE ALUMINIUM (100%
SHARE)
|
South32 share
|
YTD FY24
|
YTD FY25
|
YoY
|
|
1Q24
|
4Q24
|
1Q25
|
1Q25
vs
1Q24
|
1Q25
vs
4Q24
|
|
Aluminium production (kt)
|
180
|
180
|
0%
|
|
180
|
180
|
180
|
0%
|
0%
|
|
Aluminium sales (kt)
|
170
|
175
|
3%
|
|
170
|
184
|
175
|
3%
|
(5%)
|
Hillside Aluminium saleable
production was unchanged at 180kt in the September 2024 quarter as
the smelter continued to test its maximum technical capacity,
despite the impact of load-shedding. FY25 production guidance
remains unchanged at 720kt13.
MOZAL ALUMINIUM (63.7%
SHARE)
|
South32 share
|
YTD FY24
|
YTD FY25
|
YoY
|
|
1Q24
|
4Q24
|
1Q25
|
1Q25
vs
1Q24
|
1Q25
vs
4Q24
|
|
Aluminium production (kt)
|
84
|
88
|
5%
|
|
84
|
77
|
88
|
5%
|
14%
|
|
Aluminium sales (kt)
|
77
|
86
|
12%
|
|
77
|
101
|
86
|
12%
|
(15%)
|
Mozal Aluminium saleable production
increased by 14% (or 11kt) to 88kt in the September 2024 quarter as
the smelter achieved improved process stability following
completion of its operational recovery plan, despite the impact of
load-shedding. FY25 production
guidance remains unchanged at 360kt13.
The smelter sources all of its
alumina from our Worsley Alumina refinery with approximately 50%
priced as a percentage of the LME aluminium index under a legacy
contract and the remainder linked to the Platts Alumina index on a
M-1 basis, with caps and floors that reset every calendar year. As
a result, the smelter's cost of alumina was at a discount to the
index in the September 2024 quarter.
As previously disclosed, we continue
to work with Eskom and the Government of the Republic of Mozambique
to extend the smelter's hydro-electric power supply beyond March
2026, as there are currently no viable alternative suppliers of
renewable energy at the required scale.
SIERRA GORDA (45% SHARE)
|
South32 share
|
YTD FY24
|
YTD FY25
|
YoY
|
|
1Q24
|
4Q24
|
1Q25
|
1Q25
vs
1Q24
|
1Q25
vs
4Q24
|
|
Payable copper equivalent production
(kt)3
|
20.1
|
22.1
|
10%
|
|
20.1
|
18.4
|
22.1
|
10%
|
20%
|
|
Payable copper production
(kt)
|
16.0
|
17.6
|
10%
|
|
16.0
|
15.3
|
17.6
|
10%
|
15%
|
|
Payable copper sales (kt)
|
15.3
|
17.9
|
17%
|
|
15.3
|
15.3
|
17.9
|
17%
|
17%
|
Sierra Gorda payable copper
equivalent production3 increased by 20% (or 3.7kt) to
22.1kt in the September 2024 quarter with higher planned
copper grades and a significant increase in molybdenum recoveries
due to improved ore quality. FY25 production guidance remains
unchanged at 84.8kt payable copper equivalent (copper 70.0kt,
molybdenum 1.3kt, gold 25.0koz and silver 550koz).
A feasibility study and final
investment decision by the joint venture partners for the fourth
grinding line expansion is now expected in the second half of
calendar year 2025, to enable additional detailed engineering and
study work on the tailings thickeners to be completed.
CANNINGTON (100% SHARE)
|
South32 share
|
YTD FY24
|
YTD FY25
|
YoY
|
|
1Q24
|
4Q24
|
1Q25
|
1Q25
vs
1Q24
|
1Q25
vs
4Q24
|
|
Payable zinc equivalent production
(kt)4
|
74.7
|
50.7
|
(32%)
|
|
74.7
|
77.3
|
50.7
|
(32%)
|
(34%)
|
|
Payable silver production
(koz)
|
3,230
|
1,915
|
(41%)
|
|
3,230
|
3,065
|
1,915
|
(41%)
|
(38%)
|
|
Payable silver sales
(koz)
|
2,873
|
2,342
|
(18%)
|
|
2,873
|
3,054
|
2,342
|
(18%)
|
(23%)
|
|
Payable lead production
(kt)
|
28.5
|
19.3
|
(32%)
|
|
28.5
|
28.8
|
19.3
|
(32%)
|
(33%)
|
|
Payable lead sales (kt)
|
25.6
|
25.1
|
(2%)
|
|
25.6
|
27.9
|
25.1
|
(2%)
|
(10%)
|
|
Payable zinc production
(kt)
|
13.2
|
12.1
|
(8%)
|
|
13.2
|
17.4
|
12.1
|
(8%)
|
(30%)
|
|
Payable zinc sales (kt)
|
13.9
|
12.6
|
(9%)
|
|
13.9
|
20.2
|
12.6
|
(9%)
|
(38%)
|
Cannington payable zinc equivalent
production4 decreased by 34% (or 26.6kt) to 50.7kt in
the September 2024 quarter, as the operation managed increased
underground activity and complexity which is expected to continue
to drive variability in quarterly performance.
Ore mined decreased by 24% during
the September 2024 quarter as additional dewatering and ground
rehabilitation was required to access stoping fronts. Average metal
grades also declined as the processing of a higher grade stope was
deferred to the December 2024 quarter.
FY25 production guidance remains
unchanged at 265.4kt payable zinc equivalent (silver 11,300koz,
lead 100.0kt, zinc 50.0kt), with dewatering completed in the
September 2024 quarter expected to benefit underground performance
and access to higher grade stopes across the remainder of the
year.
CERRO MATOSO (99.9%
SHARE)
|
South32 share
|
YTD FY24
|
YTD FY25
|
YoY
|
|
1Q24
|
4Q24
|
1Q25
|
1Q25
vs
1Q24
|
1Q25
vs
4Q24
|
|
Payable nickel production
(kt)
|
8.3
|
8.6
|
4%
|
|
8.3
|
11.5
|
8.6
|
4%
|
(25%)
|
|
Payable nickel sales (kt)
|
8.5
|
8.8
|
4%
|
|
8.5
|
12.1
|
8.8
|
4%
|
(27%)
|
Cerro Matoso payable nickel
production decreased by 25% (or 2.9kt) to 8.6kt in the September
2024 quarter due to lower planned nickel grades. FY25 production
guidance remains unchanged at 35.0kt.
Sales decreased by 27% during the
September 2024 quarter due to lower product availability. The
discount for our ferronickel product narrowed to ~14% to the LME
Nickel Index17
(FY24: ~25% discount) in the September 2024
quarter, reflecting tighter global supply of class two
nickel.
We continued to progress our
strategic review of Cerro Matoso and expect to provide an update in
the June 2025 half year.
AUSTRALIA MANGANESE (60%
SHARE)
|
South32 share
|
YTD FY24
|
YTD FY25
|
YoY
|
|
1Q24
|
4Q24
|
1Q25
|
1Q25
vs
1Q24
|
1Q25
vs
4Q24
|
|
Manganese ore production
(kwmt)
|
890
|
-
|
N/A
|
|
890
|
-
|
-
|
N/A
|
N/A
|
|
Manganese ore sales
(kwmt)
|
940
|
-
|
N/A
|
|
940
|
-
|
-
|
N/A
|
N/A
|
Australia Manganese continued to
implement the operational recovery plan following the impacts of
Tropical Cyclone Megan in the March 2024 quarter. We progressed a
substantial dewatering program and a phased mining restart during
the September 2024 quarter and remain on track to resume production
from the primary concentrator during the December 2024
quarter.
We also continued our investment in
mine repairs and infrastructure, including a critical bridge and
the wharf. Wharf construction activity during the September
2024 quarter prioritised stabilisation of existing infrastructure
and safe demolition of undersea structures.
FY25 production guidance remains
unchanged at 1,000kwmt. Subject to maintaining construction
productivity during the upcoming wet season, sales volumes are
expected to progressively increase over the June 2025
quarter.
SOUTH AFRICA MANGANESE (ORE 54.6%
SHARE)
|
South32 share
|
YTD FY24
|
YTD FY25
|
YoY
|
|
1Q24
|
4Q24
|
1Q25
|
1Q25
vs
1Q24
|
1Q25
vs
4Q24
|
|
Manganese ore production
(kwmt)
|
628
|
597
|
(5%)
|
|
628
|
534
|
597
|
(5%)
|
12%
|
|
Manganese ore sales
(kwmt)
|
518
|
590
|
14%
|
|
518
|
549
|
590
|
14%
|
7%
|
South Africa Manganese saleable
production increased by 12% (or 63kwmt) to 597kwmt in the September
2024 quarter as the operation delivered strong mining performance
and continued to sell secondary products to maximise margins.
We will continue to optimise our product mix and use of higher cost
trucking in response to market conditions, with FY25 production guidance remaining unchanged at 2,000kwmt.
Planned maintenance is scheduled for the June 2025 half
year.
NOTES
|
1.
|
Upfront cash consideration of
US$1,050M less the already received deposit (US$40M) and a
provisional adjustment for working capital, net debt and capital
expenditure (US$46M).
A final adjustment to the purchase price is expected to be
determined in the December 2024 quarter.
|
|
2.
|
Refers to aluminium produced in a
process that results in less than 4t CO2-e Scope 1 and
Scope 2 GHG emissions per tonne of aluminium.
|
|
3.
|
Payable copper equivalent production
(kt) was calculated by aggregating revenues from copper,
molybdenum, gold and silver, and dividing the total Revenue by the
price of copper. FY24 realised prices for copper (US$3.86/lb),
molybdenum (US$20.60/lb), gold (US$2,129/oz) and silver
(US$24.8/oz) have been used for FY24, Q1 FY25 and FY25e.
|
|
4.
|
Payable zinc equivalent production
(kt) was calculated by aggregating revenues from payable silver,
lead and zinc, and dividing the total Revenue by the price of zinc.
FY24 realised prices for zinc (US$2,230/t), lead (US$2,002/t) and
silver (US$24.8/oz) have been used for FY24, Q1 FY25 and
FY25e.
|
|
5.
|
Refer to market release "US
Department of Energy Grant for Clark Battery-Grade Manganese" dated
20 September 2024.
|
|
6.
|
Applicable for five years from the
date of completion with no annual cap. The first two years will be
calculated and paid on the second anniversary of completion and
annually thereafter. The contingent price-linked consideration will
be calculated as 50% of incremental metallurgical coal revenue from
equity production, net of royalties, based on the following
metallurgical coal price thresholds: Year 1: US$200/t, Year 2:
US$200/t, Year 3: US$190/t, Year 4: US$180/t, Year 5:
US$180/t.
|
|
7.
|
Upfront consideration of US$15M and
completion adjustments of US$3M.
|
|
8.
|
Subject to the Eagle Downs project
reaching metallurgical coal production of 100,000
tonnes.
|
|
9.
|
Price-linked royalty calculated
based on potential future metallurgical coal production and a
metallurgical coal index price of at least US$170/t.
|
|
10.
|
Net debt number is unaudited and
should not be considered as an indication of or alternative to an
IFRS measure of profitability, financial performance or
liquidity.
|
|
11.
|
Net distributions from our material
equity accounted investments (EAI) (manganese and Sierra Gorda)
includes dividends, capital contributions and net
repayments/drawdowns of shareholder loans, which are unaudited and
should not be considered as an indication of or alternative to an
IFRS measure of profitability, financial performance or
liquidity.
|
|
12.
|
Since inception, US$1.7B has been
allocated to our on-market share buy-back (796M shares at an
average price of A$3.05 per share) and US$525M returned in the form
of special dividends.
|
|
13.
|
Production guidance for Hillside
Aluminium and Mozal Aluminium does not assume any load-shedding
impact on production.
|
|
14.
|
Reflects the period from 1 July 2024
to completion of the Transaction.
|
|
15.
|
The sales volume weighted average of
the Platts Alumina index (FOB) on the basis of a one-month lag to
published pricing (Month minus one or "M-1") was US$495/t in the
September 2024 quarter.
|
|
16.
|
The information in this announcement
that refers to Production Target and forecast financial information
for MRN is based on Proved (8%) and Probable (1%) Ore Reserves and
Measured (91%) Mineral Resources. The Mineral Resources and Ore
Reserves underpinning the Production Target have been prepared by
Competent Persons in accordance with the requirement of the JORC
Code and is available to view in South32's 2024 Annual Report
(www.south32.net) published on 29 August 2024. South32 confirms
that all material assumptions underpinning the Production Target
and forecast financial information derived from the Production
Target continues to apply and have not materially
changed.
|
|
17.
|
Our realised price for nickel sales
during the September 2024 quarter was US$6.34/lb, which represented
a ~14% discount to the average LME Nickel Index price of
US$7.37/lb.
|
|
18.
|
Illawarra Metallurgical Coal sales
are adjusted for moisture and will not reconcile directly to
Illawarra Metallurgical Coal production.
|
The following abbreviations have
been used throughout this report: US$ million (US$M); US$ billion
(US$B); grams per tonne (g/t); tonnes (t); thousand tonnes (kt);
thousand tonnes per annum (ktpa); million tonnes (Mt); million
tonnes per annum (Mtpa); ounces (oz); thousand ounces (koz);
million ounces (Moz); thousand wet metric tonnes (kwmt); million
wet metric tonnes (Mwmt); million wet metric tonnes per annum (Mwmt
pa); dry metric tonne unit (dmtu); thousand dry metric tonnes
(kdmt); Mineração Rio do Norte (MRN).
Figures in Italics indicate that an
adjustment has been made since the figures were previously
reported. The denotation (e) refers to an estimate or forecast
year.
OPERATING PERFORMANCE
|
South32 share
|
YTD FY24
|
YTD FY25
|
|
1Q24
|
2Q24
|
3Q24
|
4Q24
|
1Q25
|
|
Worsley Alumina (86% share)
|
|
|
|
|
|
|
|
|
|
Alumina hydrate production
(kt)
|
973
|
932
|
|
973
|
961
|
926
|
919
|
932
|
|
Alumina production (kt)
|
972
|
850
|
|
972
|
962
|
927
|
916
|
850
|
|
Alumina sales (kt)
|
913
|
824
|
|
913
|
985
|
895
|
974
|
824
|
|
Brazil Alumina (36% share)
|
|
|
|
|
|
|
|
|
|
Alumina production (kt)
|
318
|
334
|
|
318
|
322
|
313
|
333
|
334
|
|
Alumina sales (kt)
|
272
|
326
|
|
272
|
375
|
277
|
358
|
326
|
|
Brazil Aluminium (40% share)
|
|
|
|
|
|
|
|
|
|
Aluminium production (kt)
|
24
|
30
|
|
24
|
26
|
26
|
28
|
30
|
|
Aluminium sales (kt)
|
8
|
25
|
|
8
|
32
|
32
|
30
|
25
|
|
Hillside Aluminium (100% share)
|
|
|
|
|
|
|
|
|
|
Aluminium production (kt)
|
180
|
180
|
|
180
|
179
|
181
|
180
|
180
|
|
Aluminium sales (kt)
|
170
|
175
|
|
170
|
157
|
209
|
184
|
175
|
|
Mozal Aluminium (63.7% share)
|
|
|
|
|
|
|
|
|
|
Aluminium production (kt)
|
84
|
88
|
|
84
|
82
|
71
|
77
|
88
|
|
Aluminium sales (kt)
|
77
|
86
|
|
77
|
90
|
58
|
101
|
86
|
|
Sierra Gorda (45% share)
|
|
|
|
|
|
|
|
|
|
Ore mined (Mt)
|
5.9
|
6.4
|
|
5.9
|
6.0
|
3.1
|
4.9
|
6.4
|
|
Ore processed (Mt)
|
5.5
|
5.6
|
|
5.5
|
5.4
|
5.5
|
5.5
|
5.6
|
|
Copper ore grade processed (%,
Cu)
|
0.37
|
0.41
|
|
0.37
|
0.38
|
0.34
|
0.37
|
0.41
|
|
Payable copper equivalent production
(kt)3
|
20.1
|
22.1
|
|
20.1
|
18.3
|
16.7
|
18.4
|
22.1
|
|
Payable copper production
(kt)
|
16.0
|
17.6
|
|
16.0
|
15.6
|
13.9
|
15.3
|
17.6
|
|
Payable copper sales (kt)
|
15.3
|
17.9
|
|
15.3
|
17.2
|
13.1
|
15.3
|
17.9
|
|
Payable molybdenum production
(kt)
|
0.4
|
0.4
|
|
0.4
|
0.1
|
0.2
|
0.2
|
0.4
|
|
Payable molybdenum sales
(kt)
|
0.4
|
0.2
|
|
0.4
|
0.3
|
0.4
|
0.2
|
0.2
|
|
Payable gold production
(koz)
|
6.3
|
7.7
|
|
6.3
|
7.1
|
5.3
|
5.9
|
7.7
|
|
Payable gold sales (koz)
|
6.3
|
7.8
|
|
6.3
|
7.5
|
5.2
|
5.9
|
7.8
|
|
Payable silver production
(koz)
|
145
|
151
|
|
145
|
150
|
153
|
159
|
151
|
|
Payable silver sales
(koz)
|
140
|
157
|
|
140
|
160
|
141
|
164
|
157
|
|
Cannington (100% share)
|
|
|
|
|
|
|
|
|
|
Ore mined (kwmt)
|
551
|
438
|
|
551
|
599
|
529
|
573
|
438
|
|
Ore processed (kdmt)
|
562
|
440
|
|
562
|
577
|
525
|
557
|
440
|
|
Silver ore grade processed (g/t,
Ag)
|
206
|
163
|
|
206
|
216
|
200
|
199
|
163
|
|
Lead ore grade processed (%,
Pb)
|
5.8
|
5.1
|
|
5.8
|
6.2
|
5.6
|
5.9
|
5.1
|
|
Zinc ore grade processed (%,
Zn)
|
3.2
|
3.7
|
|
3.2
|
3.6
|
3.8
|
4.1
|
3.7
|
|
Payable zinc equivalent production
(kt)4
|
74.7
|
50.7
|
|
74.7
|
81.6
|
68.8
|
77.3
|
50.7
|
|
Payable silver production
(koz)
|
3,230
|
1,915
|
|
3,230
|
3,474
|
2,897
|
3,065
|
1,915
|
|
Payable silver sales
(koz)
|
2,873
|
2,342
|
|
2,873
|
3,656
|
2,210
|
3,054
|
2,342
|
|
Payable lead production
(kt)
|
28.5
|
19.3
|
|
28.5
|
30.3
|
24.8
|
28.8
|
19.3
|
|
Payable lead sales (kt)
|
25.6
|
25.1
|
|
25.6
|
31.0
|
17.9
|
27.9
|
25.1
|
|
Payable zinc production
(kt)
|
13.2
|
12.1
|
|
13.2
|
15.8
|
14.3
|
17.4
|
12.1
|
|
Payable zinc sales (kt)
|
13.9
|
12.6
|
|
13.9
|
14.4
|
11.6
|
20.2
|
12.6
|
|
Cerro Matoso (99.9% share)
|
|
|
|
|
|
|
|
|
|
Ore mined (kwmt)
|
940
|
1,338
|
|
940
|
1,243
|
1,486
|
1,526
|
1,338
|
|
Ore processed (kdmt)
|
594
|
664
|
|
594
|
723
|
711
|
746
|
664
|
|
Ore grade processed (%,
Ni)
|
1.57
|
1.46
|
|
1.57
|
1.53
|
1.61
|
1.70
|
1.46
|
|
Payable nickel production
(kt)
|
8.3
|
8.6
|
|
8.3
|
10.0
|
10.8
|
11.5
|
8.6
|
|
Payable nickel sales (kt)
|
8.5
|
8.8
|
|
8.5
|
9.5
|
10.8
|
12.1
|
8.8
|
|
Australia Manganese (60% share)
|
|
|
|
|
|
|
|
|
|
Manganese ore production
(kwmt)
|
890
|
-
|
|
890
|
789
|
645
|
-
|
-
|
|
Manganese ore sales
(kwmt)
|
940
|
-
|
|
940
|
924
|
709
|
-
|
-
|
|
Ore grade sold (%, Mn)
|
42.9
|
-
|
|
42.9
|
42.2
|
42.2
|
-
|
-
|
|
South Africa Manganese (54.6% share)
|
|
|
|
|
|
|
|
|
|
Manganese ore production
(kwmt)
|
628
|
597
|
|
628
|
483
|
530
|
534
|
597
|
|
Manganese ore sales
(kwmt)
|
518
|
590
|
|
518
|
564
|
485
|
549
|
590
|
|
Ore grade sold (%, Mn)
|
39.0
|
38.9
|
|
39.0
|
38.4
|
38.7
|
39.1
|
38.9
|
|
Illawarra Metallurgical Coal (100%
share)14
|
|
|
|
|
|
|
|
|
|
Total coal production
(kt)
|
1,168
|
766
|
|
1,168
|
877
|
1,405
|
1,488
|
766
|
|
Total coal sales
(kt)18
|
1,196
|
540
|
|
1,196
|
900
|
1,238
|
1,537
|
540
|
|
Metallurgical coal production
(kt)
|
1,043
|
676
|
|
1,043
|
744
|
1,244
|
1,274
|
676
|
|
Metallurgical coal sales
(kt)
|
996
|
507
|
|
996
|
763
|
1,053
|
1,360
|
507
|
|
Energy coal production
(kt)
|
125
|
90
|
|
125
|
133
|
161
|
214
|
90
|
|
Energy coal sales (kt)
|
200
|
33
|
|
200
|
137
|
185
|
177
|
33
|
Forward-looking statements
This release contains
forward-looking statements, including statements about trends in
commodity prices and currency exchange rates; demand for
commodities; production forecasts; plans, strategies and objectives
of management; capital costs and scheduling; operating costs;
anticipated productive lives of projects, mines and facilities; and
provisions and contingent liabilities. These forward-looking
statements reflect expectations at the date of this release,
however they are not guarantees or predictions of future
performance. They involve known and unknown risks, uncertainties
and other factors, many of which are beyond our control, and which
may cause actual results to differ materially from those expressed
in the statements contained in this release. Readers are cautioned
not to put undue reliance on forward-looking statements. Except as
required by applicable laws or regulations, the South32 Group does
not undertake to publicly update or review any forward-looking
statements, whether as a result of new information or future
events. Past performance cannot be relied on as a guide to future
performance. South32 cautions against reliance on any
forward-looking statements or guidance.
FURTHER INFORMATION
|
INVESTOR RELATIONS
Ben Baker
M +61 403 763 086
E
Ben.Baker@south32.net
|
MEDIA RELATIONS
Jamie Macdonald
M +61 408 925 140
E
Jamie.Macdonald@south32.net
|
Miles Godfrey
M +61 415 325 906
E
Miles.Godfrey@south32.net
|
Approved
for release to the market by Graham Kerr, Chief Executive
Officer
JSE Sponsor: The Standard Bank of South Africa Limited
21 October
2024
South32
Limited
(Incorporated in Australia under the Corporations Act 2001
(Cth))
(ACN 093
732 597)
ASX / LSE /
JSE Share Code: S32; ADR: SOUHY
ISIN:
AU000000S320