TIDMS32
RNS Number : 7894P
South32 Limited
21 October 2021
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
21 September 2021
South32 Limited
Quarterly Report September 2021
"Our operations continue to perform well, achieving record
production at South Africa Manganese and maintaining production
above nameplate capacity at Worsley Alumina. Production at Mozal
Aluminium was higher, with the smelter benefitting from our
investment in the AP3XLE energy efficiency technology.
"Our teams continue to achieve strong operating results, despite
the ongoing challenges of COVID-19 across the globe.
"Our operating performance has further strengthened our
financial position, supporting the continuation of our on-market
share buy-back, and subsequent to the end of the period, payment of
our US$256M fully franked ordinary and special dividends in respect
of the June 2021 half year.
"We continue to actively reshape our portfolio for a low carbon
future, and last week entered into binding conditional agreements
to acquire a 45 per cent interest in Sierra Gorda, a long life,
open pit copper mine in Chile. We have also recently exercised our
pre-emptive rights to acquire an additional interest inMozal
Aluminium. These initiatives, and our ongoing work with Alcoa in
Brazil to investigate the Alumar smelter's potential restart using
renewable power, will see us increase our leverage to the metals
critical to the green energy transition."
Graham Kerr, South32 CEO
-- Maintained FY22 production guidance with our operations continuing
to deliver to plan, taking advantage of rising commodity prices
-- Delivered a US$254M increase in our net cash position to US$660M(1)
, with higher commodity prices and third party logistics disruptions
resulting in a build in working capital
-- Achieved a 7% increase in manganese production, with a quarterly
record at South Africa Manganese and a strong start to the year
at Australia Manganese
-- Maintained production above nameplate capacity at Worsley Alumina,
with the operation continuing to benefit from improvement initiatives
-- Restored production to normalised rates at Brazil Alumina in October,
following an incident that damaged one of the bauxite unloaders
at the refinery in July 2021
-- Increased production at Mozal Aluminium, with smelter productivity
benefitting from our investment in the AP3XLE energy efficiency
technology
-- Recorded sequentially lower base metals production, with Cerro
Matoso impacted by a temporary equipment outage, while Cannington
extracted a planned series of lower grade stopes
-- Entered into binding conditional agreements to acquire a 45% interest
in Sierra Gorda, an operating copper mine in Chile which is expected
to deliver copper equivalent production of 214kt in CY21e (100%
basis)(2)
-- Exercised our pre-emptive rights to acquire an additional interest
in our hydro powered aluminium smelter, Mozal Aluminium(3)
Production summary
South32 share YTD FY21 YTD FY22 YoY 1Q21 4Q21 1Q22 QoQ
=============================== ========= ========= ====== ====== ====== ====== ======
Alumina production (kt) 1,315 1,278 (3%) 1,315 1,427 1,278 (10%)
=============================== ========= ========= ====== ====== ====== ====== ======
Aluminium production
(kt) 248 248 0% 248 246 248 1%
=============================== ========= ========= ====== ====== ====== ====== ======
Metallurgical coal production
(kt) 1,863 1,575 (15%) 1,863 1,340 1,575 18%
=============================== ========= ========= ====== ====== ====== ====== ======
Energy coal production
(kt) 508 313 (38%) 508 385 313 (19%)
=============================== ========= ========= ====== ====== ====== ====== ======
Manganese ore production
(kwmt) 1,461 1,565 7% 1,461 1,464 1,565 7%
=============================== ========= ========= ====== ====== ====== ====== ======
Payable nickel production
(kt) 10.0 9.6 (4%) 10.0 10.9 9.6 (12%)
=============================== ========= ========= ====== ====== ====== ====== ======
Payable silver production
(koz) 2,863 3,493 22% 2,863 4,178 3,493 (16%)
=============================== ========= ========= ====== ====== ====== ====== ======
Payable lead production
(kt) 26.4 31.9 21% 26.4 41.2 31.9 (23%)
=============================== ========= ========= ====== ====== ====== ====== ======
Payable zinc production
(kt) 12.4 15.4 24% 12.4 19.5 15.4 (21%)
=============================== ========= ========= ====== ====== ====== ====== ======
Unless otherwise noted: percentage variance relates to performance
during September 2021 quarter compared with the June 2021 (QoQ); production
and sales volumes are reported on an attributable basis.
=============================================================================================
Corporate Update
-- Our net cash balance(1) increased by US$254M to US$660M during
the quarter. Notwithstanding our strong cash generation, which
included net distributions(4) of US$45M (South32 share) from our
manganese equity accounted investments (EAI), we have experienced
a build in working capital as a result of higher commodity prices
and third party logistics disruptions at many ports across our
geographic footprint.
-- We exercised our pre-emptive rights to acquire an additional shareholding
in Mozal Aluminium from MCA Metals Holding GmbH (Mitsubishi) during
the quarter(3) . Subsequent to the end of the period, the Industrial
Development Corporation of South Africa (IDC) also notified Mitsubishi
of its intention to trigger their pre-emptive rights. Accordingly
our shareholding is expected to increase by a minimum of 16.6%
to 63.7% for a headline purchase price of US$166M. Completion of
the transaction is subject to the satisfaction of customary conditions.
-- Subsequent to the end of the period, we entered into two binding
conditional agreements with Sumitomo Metal Mining and Sumitomo
Corporation (collectively Sumitomo) to acquire a 45% interest in
the Sierra Gorda copper mine in Chile for an upfront cash consideration
of US$1.55B and a contingent price-linked consideration of up to
US$500M(2) . The upfront consideration is expected to be funded
from cash on hand and a US$1B acquisition debt facility. Completion
of the transaction is expected around the end of calendar year
2021, subject to the waiver or non-exercise of pre-emption rights
held by 55% joint venture partner KGHM Polska Miedz, and competition
and regulatory approvals.
-- Our strong financial position also supported the purchase of a
further 10M shares via our on-market share buy-back at an average
price of A$2.95 per share in the September 2021 quarter. Subsequent
to the end of the period, we also paid a fully franked ordinary
dividend of US$163M and a fully franked special dividend of US$93M
in respect of the June 2021 half year. Our US$2B capital management
program is 88% complete with US$231M remaining to be returned to
shareholders ahead of its extension or expiry on 2 September 2022(5)
.
-- Subsequent to the end of the quarter and consistent with our commitment
to maintain an investment grade credit rating, S&P and Moody's
reaffirmed their respective BBB+ and Baa1 credit ratings for the
Group.
-- During the quarter the Colombian government passed legislation
to increase the country's corporate tax rate to 35% from 1 January
2022 (it was previously scheduled to reduce from 31% to 30% on
this date). Notwithstanding this increase, our FY22 Group Underlying
effective tax rate is expected to return to normalised levels that
reflect the corporate tax rates of the geographies where the Group
operates which include: Australia 30%, South Africa 28%, Colombia
31%(6) , Mozambique 0%(6) and Brazil 34%.
-- We have commenced a process to investigate the potential divestment
of our interest in the Eagle Downs Metallurgical Coal development
option.
Development and Exploration Update
-- We continued work on our Taylor Deposit pre-feasibility study (PFS)
at our Hermosa project, while making progress with our scoping
study for the Clark Deposit. We expect to report the outcomes for
the Taylor PFS around the end of the calendar year.
-- Subsequent to the end of the period, we completed the summer exploration
season at our Ambler Metals Joint Venture. Although total drilling
metres and productivity were impacted by adverse weather and challenges
in fully staffing the program, sufficient material was recovered
to complete planned metallurgical work and geotechnical drilling
at the Arctic Deposit.
-- We invested US$7M during the September 2021 quarter in our early
stage greenfield exploration opportunities. With COVID-19 restrictions
generally diminishing across jurisdictions, activity continues
to ramp-up with multiple programs targeting base and precious metals
underway in Australia, USA, Canada, Argentina, Peru and Ireland.
-- We directed US$15M towards exploration programs at our existing
operations and development options during the September 2021 quarter
(US$11M capitalised), including US$0.5M for our EAI (US$0.1M capitalised),
US$4M at the Hermosa project (all capitalised) and US$6M at Ambler
Metals (all capitalised).
Production Summary
Production guidance FY21 3M YTD FY22 FY22e(a)
(South32 share)
Worsley Alumina
============================================ ======= ============ =========
Alumina production (kt) 3,963 1,006 3,965
============================================ ======= ============ =========
Brazil Alumina
============================================ ======= ============ =========
Alumina production (kt) 1,398 272 1,300
============================================ ======= ============ =========
Hillside Aluminium(7)
============================================ ======= ============ =========
Aluminium production (kt) 717 180 720
============================================ ======= ============ =========
Mozal Aluminium(7)
============================================ ======= ============ =========
Aluminium production (kt) 265 68 273
============================================ ======= ============ =========
Illawarra Metallurgical Coal
============================================ ======= ============ =========
Total coal production (kt) 7,645 1,888 7,300
============================================ ======= ============ =========
Metallurgical coal production (kt) 6,170 1,575 6,300
============================================ ======= ============ =========
Energy coal production (kt) 1,475 313 1,000
============================================ ======= ============ =========
Australia Manganese
============================================ ======= ============ =========
Manganese ore production (kwmt) 3,529 897 3,500
============================================ ======= ============ =========
South Africa Manganese
============================================ ======= ============ =========
Manganese ore production(8) (kwmt) 2,264 668 2,200
============================================ ======= ============ =========
Cerro Matoso
============================================ ======= ============ =========
Payable nickel production (kt) 34.1 9.6 43.8
============================================ ======= ============ =========
Cannington
============================================ ======= ============ =========
Payable zinc equivalent production(9) (kt) 319.0 78.2 278.3
============================================ ======= ============ =========
Payable silver production (koz) 13,655 3,493 11,647
============================================ ======= ============ =========
Payable lead production (kt) 131.8 31.9 112.6
============================================ ======= ============ =========
Payable zinc production (kt) 67.7 15.4 63.9
============================================ ======= ============ =========
a. The denotation (e) refers to an estimate or forecast year.
All guidance is subject to further potential impacts from
COVID-19.
Worsley Alumina (86% share)
1Q22 1Q22
YTD YTD vs vs
South32 share FY21 FY22 YoY 1Q21 4Q21 1Q22 1Q21 4Q21
Alumina production (kt) 963 1,006 4% 963 1,078 1,006 4% (7%)
======================== ===== ===== ==== ===== ===== ===== ===== =====
Alumina sales (kt) 1,001 924 (8%) 1,001 1,086 924 (8%) (15%)
======================== ===== ===== ==== ===== ===== ===== ===== =====
Worsley Alumina saleable production decreased by 7% (or 72kt) to
1,006kt in the September 2021 quarter. Following the prior period's
drawdown of hydrate inventory, the refinery continued to operate
above nameplate capacity with calcination rates now normalised.
FY22 production guidance remains unchanged at 3,965kt with the
refinery continuing to benefit from improvement initiatives.
Notwithstanding the continued strong operating performance,
elevated caustic soda prices are expected to further impact the
refinery's Operating unit cost guidance for FY22 of US$241/t.
Sales decreased by 15% during the September 2021 quarter as our
shipping schedule was impacted by adverse weather and COVID-19
quarantine requirements.
We realised a circa 15% premium to the Platts Alumina Index(10)
on a volume weighted M-1 basis for alumina sales in the September
2021 quarter, with our realised prices benefitting from a legacy
supply contract with Mozal Aluminium, and elevated global freight
rates which are also reflected in Operating unit costs.
Brazil Alumina (36% share)
1Q22 1Q22
YTD YTD vs vs
South32 share FY21 FY22 YoY 1Q21 4Q21 1Q22 1Q21 4Q21
Alumina production (kt) 352 272 (23%) 352 349 272 (23%) (22%)
======================== ===== ===== ===== ==== ==== ==== ===== =====
Alumina sales (kt) 340 247 (27%) 340 333 247 (27%) (26%)
======================== ===== ===== ===== ==== ==== ==== ===== =====
Brazil Alumina saleable production decreased by 22% (or 77kt) to
272kt in the September 2021 quarter following an incident in July
that damaged one of the two bauxite unloaders at the refinery. The
operation took immediate action to mitigate the disruption through
the installation of temporary loading infrastructure and returned
to full capacity in October. With the ramp-up of the refinery
meeting prior expectations, FY22 production guidance remains
unchanged at 1,300kt.
Separately, we are working with our partner Alcoa to investigate
a potential restart of the Alumar aluminium smelter in H2 FY22
using 100% renewable energy from 2024. We expect to make a decision
on the potential restart by the end of the calendar year.
Hillside Aluminium (100%)
1Q22 1Q22
YTD YTD vs vs
South32 share FY21 FY22 YoY 1Q21 4Q21 1Q22 1Q21 4Q21
Aluminium production (kt) 180 180 0% 180 180 180 0% 0%
========================== ===== ===== ==== ==== ==== ==== ===== =====
Aluminium sales (kt) 175 160 (9%) 175 169 160 (9%) (5%)
========================== ===== ===== ==== ==== ==== ==== ===== =====
Hillside Aluminium saleable production remained at 180kt in the
September 2021 quarter as the smelter continued to test its maximum
technical capacity, despite the impact of further load-shedding.
FY22 production guidance(7) remains unchanged at 720kt.
Sales decreased by 5% in the September 2021 quarter as port
congestion impacted the timing of shipments.
In August we finalised a new agreement with Eskom which secures
the smelter's energy supply until 2031. The new tariff is South
African rand based, with a rate of escalation linked to the South
Africa Producer Price Index.
Mozal Aluminium (47.1% share)
1Q22 1Q22
YTD YTD vs vs
South32 share FY21 FY22 YoY 1Q21 4Q21 1Q22 1Q21 4Q21
Aluminium production (kt) 68 68 0% 68 66 68 0% 3%
========================== ===== ===== ===== ==== ==== ==== ===== =====
Aluminium sales (kt) 64 55 (14%) 64 68 55 (14%) (19%)
========================== ===== ===== ===== ==== ==== ==== ===== =====
Mozal Aluminium saleable production increased by 3% (or 2kt) to
68kt in the September 2021 quarter as the smelter's productivity
benefitted from our investment in the AP3XLE energy efficiency
project. Notwithstanding the further impact of load-shedding, the
smelter continues to test its maximum technical capacity, and FY22
production guidance(7) of 273kt remains unchanged.
Sales decreased by 19% in the September 2021 quarter as port
congestion impacted the timing of shipments.
The smelter sources 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 an M-1 basis, with caps and floors embedded
within specific contracts. As a result of these contracts the
smelter paid a premium to the Platts index on an M-1 basis for
alumina sourced during the September 2021 quarter.
Illawarra Metallurgical Coal (100%)
1Q22 1Q22
YTD YTD vs vs
South32 share FY21 FY22 YoY 1Q21 4Q21 1Q22 1Q21 4Q21
Total coal production (kt) 2,371 1,888 (20%) 2,371 1,725 1,888 (20%) 9%
=============================== ====== ====== ====== ====== ====== ====== ====== ======
Total coal sales(11) (kt) 1,940 1,708 (12%) 1,940 1,766 1,708 (12%) (3%)
=============================== ====== ====== ====== ====== ====== ====== ====== ======
Metallurgical coal production
(kt) 1,863 1,575 (15%) 1,863 1,340 1,575 (15%) 18%
=============================== ====== ====== ====== ====== ====== ====== ====== ======
Metallurgical coal sales
(kt) 1,468 1,490 1% 1,468 1,367 1,490 1% 9%
=============================== ====== ====== ====== ====== ====== ====== ====== ======
Energy coal production
(kt) 508 313 (38%) 508 385 313 (38%) (19%)
=============================== ====== ====== ====== ====== ====== ====== ====== ======
Energy coal sales (kt) 472 218 (54%) 472 399 218 (54%) (45%)
=============================== ====== ====== ====== ====== ====== ====== ====== ======
Illawarra Metallurgical Coal saleable production increased by 9%
(or 163kt) to 1,888kt in the September 2021 quarter with longwall
productivity improving, following challenging strata conditions and
a longwall move in the prior period. Notwithstanding, energy coal
production declined as no sales of low-margin coal wash material
were made in the quarter, with elevated freight rates making them
uneconomic.
While the lower total volumes are expected to adversely impact
Operating unit costs, realised prices will benefit due to fewer
sales of the lower priced product and the current strong
metallurgical coal market. FY22 production guidance remains
unchanged at 7.3Mt, with an extended longwall move scheduled at the
Dendrobium mine in the December 2021 quarter. Further longwall
moves are planned for the March 2022 and June 2022 quarters.
Australia Manganese (60% share)
1Q22 1Q22
YTD YTD vs vs
South32 share FY21 FY22 YoY 1Q21 4Q21 1Q22 1Q21 4Q21
============================ ====== ====== ===== ===== ===== ===== ====== ======
Manganese ore production
(kwmt) 880 897 2% 880 866 897 2% 4%
============================ ====== ====== ===== ===== ===== ===== ====== ======
Manganese ore sales (kwmt) 994 906 (9%) 994 891 906 (9%) 2%
============================ ====== ====== ===== ===== ===== ===== ====== ======
Australia Manganese saleable production increased by 4% (or
31kwmt) to 897kwmt in the September 2021 quarter with the PC02
circuit continuing to operate above nameplate capacity, supported
by an improvement in product yield. FY22 production guidance
remains unchanged at 3,500kwmt.
We disclosed our updated Mineral Resource estimate in September
to incorporate results from the initial phase of our ongoing
Southern Areas exploration program, adding a further 17Mt to
GEMCO's Total Mineral Resource of 157Mt(12) .
South Africa Manganese (60% share)
1Q22 1Q22
YTD YTD vs vs
South32 share FY21 FY22 YoY 1Q21 4Q21 1Q22 1Q21 4Q21
============================= ====== ====== ==== ===== ===== ===== ====== ======
Manganese ore production(8)
(kwmt) 581 668 15% 581 598 668 15% 12%
============================= ====== ====== ==== ===== ===== ===== ====== ======
Manganese ore sales(8)
(kwmt) 517 566 9% 517 636 566 9% (11%)
============================= ====== ====== ==== ===== ===== ===== ====== ======
South Africa Manganese saleable production increased by 12% (or
70kwmt) to a record 668kwmt in the September 2021 quarter, due to
higher volumes of premium material from our Mamatwan mine. While
starting the year well ahead on an annualised basis, FY22
production guidance remains unchanged at 2,200kwmt as we monitor
market conditions and our continued use of higher cost
trucking.
Ore sales decreased by 11% during the September 2021 quarter as
we established additional finished goods inventory ahead of a
planned shut. Notwithstanding the lower volumes, we achieved a
premium to the medium grade 37% manganese lump ore index(13) on a
volume weighted M-1 basis as we optimised our sales mix.
Cerro Matoso (99.9% share)
1Q22 1Q22
YTD YTD vs vs
South32 share FY21 FY22 YoY 1Q21 4Q21 1Q22 1Q21 4Q21
=========================== ====== ====== ===== ===== ===== ===== ====== ======
Payable nickel production
(kt) 10.0 9.6 (4%) 10.0 10.9 9.6 (4%) (12%)
=========================== ====== ====== ===== ===== ===== ===== ====== ======
Payable nickel sales (kt) 10.4 10.4 0% 10.4 10.3 10.4 0% 1%
=========================== ====== ====== ===== ===== ===== ===== ====== ======
Cerro Matoso payable nickel production decreased by 12% (or
1.3kt) to 9.6kt in the September 2021 quarter as plant availability
was impacted by an unplanned transformer outage. FY22 production
guidance remains unchanged at 43.8kt with the operation
implementing mitigating actions to recover volumes across the
remainder of the year.
Our ferronickel product sells with reference to the LME Nickel
index price on a M or M+1 basis. While product discounts averaged
9% during the September 2021 quarter, these have reduced for
recently completed sales.
Cannington (100% share)
1Q22 1Q22
YTD YTD vs vs
South32 share FY21 FY22 YoY 1Q21 4Q21 1Q22 1Q21 4Q21
============================ ====== ====== ====== ====== ====== ====== ====== ======
Payable zinc equivalent
production(9) (kt) 64.1 78.2 22% 64.1 97.1 78.2 22% (19%)
============================ ====== ====== ====== ====== ====== ====== ====== ======
Payable silver production
(koz) 2,863 3,493 22% 2,863 4,178 3,493 22% (16%)
============================ ====== ====== ====== ====== ====== ====== ====== ======
Payable silver sales (koz) 2,967 2,718 (8%) 2,967 4,460 2,718 (8%) (39%)
============================ ====== ====== ====== ====== ====== ====== ====== ======
Payable lead production
(kt) 26.4 31.9 21% 26.4 41.2 31.9 21% (23%)
============================ ====== ====== ====== ====== ====== ====== ====== ======
Payable lead sales (kt) 29.5 25.3 (14%) 29.5 41.9 25.3 (14%) (40%)
============================ ====== ====== ====== ====== ====== ====== ====== ======
Payable zinc production
(kt) 12.4 15.4 24% 12.4 19.5 15.4 24% (21%)
============================ ====== ====== ====== ====== ====== ====== ====== ======
Payable zinc sales (kt) 11.8 14.3 21% 11.8 21.3 14.3 21% (33%)
============================ ====== ====== ====== ====== ====== ====== ====== ======
Cannington payable zinc equivalent production decreased by 19%
(or 18.9kt) to 78.2kt in the September 2021 quarter as planned
surface maintenance lowered plant throughput, and average grades
declined following the prior period's extraction of a higher grade
mining sequence. Ore mined increased by 8% as continued strong
underground performance supported the establishment of additional
run of mine inventory during the surface outage.
The operation remains on-track to transition to 100% truck
haulage from the June 2022 quarter, with FY22 production guidance
remaining unchanged (silver 11,647koz, lead 112.6kt and zinc
63.9kt).
Notes
1 Net cash number is unaudited and should not be considered as an
indication of or alternative to an IFRS measure of profitability,
financial performance or liquidity.
2 Refer to market release "South32 to acquire a 45% interest in the
Sierra Gorda copper mine" dated 14 October 2021. Upfront consideration
subject to customary working capital and net debt adjustments.
Contingent price-linked consideration payable at threshold copper
production rates and prices in the years 2022-25.
3 Refer to market release "South32 to acquire up to an additional
25% of Mozal Aluminium" dated 30 September 2021.
4 Net distributions from equity accounted investments includes net
debt movements and dividends, which are unaudited and should not
be considered as an indication of or alternative to an IFRS measure
of profitability, financial performance or liquidity.
5 Since inception, US$1.4B has been allocated to the on-market share
buy-back (659M shares at an average price of A$2.87 per share)
and US$385M returned in the form of special dividends.
6 The Colombian corporate tax rate is 31% in CY21 and will increase
to 35% from 1 January 2022 in accordance with recently passed legislation.
The Mozambique operations are subject to a royalty on revenues
instead of income tax.
7 Production guidance for Hillside Aluminium and Mozal Aluminium
does not assume any load-shedding impact on production.
8 Consistent with the presentation of South32's segment information,
South Africa Manganese ore production and sales have been reported
at 60%. The Group's financial statements will continue to reflect
a 54.6% interest in South Africa Manganese ore.
9 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. FY21 realised prices for zinc (US$2,357/t),
lead (US$1,862/t) and silver (US$25.4/oz) have been used for FY21,
Q1 FY22 and FY22e.
10 The quarterly sales volume weighted average of the Platts Alumina
Index (FOB Australia) on the basis of a one month lag to published
pricing (Month minus one or "M-1") was US$293/t in the September
2021 quarter.
11 Illawarra Metallurgical Coal sales are adjusted for moisture and
will not reconcile directly to Illawarra Metallurgical Coal production.
12 Information in this report that relates to Mineral Resource estimates
for GEMCO was declared as part of South32's annual Resource and
Reserve declaration in the FY21 Annual Report ( www.south32.net
) issued on 3 September 2021 and prepared by Competent Person in
accordance with the requirements of the JORC Code. South32 confirms
that it is not aware of any new information or data that materially
affects the information included in the original announcements.
All material assumptions and technical parameters underpinning
the estimates in the relevant market announcement continue to apply
and have not materially changed. South32 confirms that the form
and context in which the Competent Person's findings are presented
have not been materially modified from the original market announcement.
13 The quarterly sales volume weighted average of the Metal Bulletin
37% manganese lump ore index (FOB Port Elizabeth, South Africa)
on the basis of a one month lag to published pricing (Month minus
one or "M-1") was US$3.11/dmtu in the September 2021 quarter.
The following abbreviations have been used throughout this
report: US$ 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); thousand dry metric tonnes
(kdmt).
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
YTD YTD
South32 share FY21 FY22 1Q21 2Q21 3Q21 4Q21 1Q22
====================================== ===== ===== ===== ===== ===== ===== =====
Worsley Alumina (86% share)
====================================== ===== ===== ===== ===== ===== ===== =====
Alumina hydrate production (kt) 1,010 997 1,010 1,002 977 992 997
====================================== ===== ===== ===== ===== ===== ===== =====
Alumina production (kt) 963 1,006 963 1,047 875 1,078 1,006
====================================== ===== ===== ===== ===== ===== ===== =====
Alumina sales (kt) 1,001 924 1,001 1,077 840 1,086 924
====================================== ===== ===== ===== ===== ===== ===== =====
Brazil Alumina (36% share)
====================================== ===== ===== ===== ===== ===== ===== =====
Alumina production (kt) 352 272 352 354 343 349 272
====================================== ===== ===== ===== ===== ===== ===== =====
Alumina sales (kt) 340 247 340 334 384 333 247
====================================== ===== ===== ===== ===== ===== ===== =====
Hillside Aluminium (100%)
====================================== ===== ===== ===== ===== ===== ===== =====
Aluminium production (kt) 180 180 180 181 176 180 180
====================================== ===== ===== ===== ===== ===== ===== =====
Aluminium sales (kt) 175 160 175 172 191 169 160
====================================== ===== ===== ===== ===== ===== ===== =====
Mozal Aluminium (47.1% share)
====================================== ===== ===== ===== ===== ===== ===== =====
Aluminium production (kt) 68 68 68 67 64 66 68
====================================== ===== ===== ===== ===== ===== ===== =====
Aluminium sales (kt) 64 55 64 66 64 68 55
====================================== ===== ===== ===== ===== ===== ===== =====
South Africa Energy Coal (100% share
divested)
============================================= ===== ===== ===== ===== ===== =====
Energy coal production (kt) 6,263 - 6,263 4,980 3,764 3,079 -
====================================== ===== ===== ===== ===== ===== ===== =====
Domestic sales (kt) 3,607 - 3,607 2,920 2,025 1,823 -
====================================== ===== ===== ===== ===== ===== ===== =====
Export sales (kt) 2,487 - 2,487 2,210 1,879 1,449 -
====================================== ===== ===== ===== ===== ===== ===== =====
Illawarra Metallurgical Coal
(100%)
====================================== ===== ===== ===== ===== ===== ===== =====
Total coal production (kt) 2,371 1,888 2,371 1,725 1,824 1,725 1,888
====================================== ===== ===== ===== ===== ===== ===== =====
Total coal sales(11) (kt) 1,940 1,708 1,940 2,087 1,823 1,766 1,708
====================================== ===== ===== ===== ===== ===== ===== =====
Metallurgical coal production
(kt) 1,863 1,575 1,863 1,399 1,568 1,340 1,575
====================================== ===== ===== ===== ===== ===== ===== =====
Metallurgical coal sales (kt) 1,468 1,490 1,468 1,697 1,542 1,367 1,490
====================================== ===== ===== ===== ===== ===== ===== =====
Energy coal production (kt) 508 313 508 326 256 385 313
====================================== ===== ===== ===== ===== ===== ===== =====
Energy coal sales (kt) 472 218 472 390 281 399 218
====================================== ===== ===== ===== ===== ===== ===== =====
Australia Manganese (ore 60% share, alloy
60% share divested)
==================================================== ===== ===== ===== ===== =====
Manganese ore production (kwmt) 880 897 880 954 829 866 897
====================================== ===== ===== ===== ===== ===== ===== =====
Manganese ore sales (kwmt) 994 906 994 871 865 891 906
====================================== ===== ===== ===== ===== ===== ===== =====
Ore grade sold (%, Mn) 44.3 44.2 44.3 44.5 44.4 44.5 44.2
====================================== ===== ===== ===== ===== ===== ===== =====
Manganese alloy production (kt) 27 - 27 24 - - -
====================================== ===== ===== ===== ===== ===== ===== =====
Manganese alloy sales (kt) 26 - 26 33 - - -
====================================== ===== ===== ===== ===== ===== ===== =====
South Africa Manganese (60%
share)
====================================== ===== ===== ===== ===== ===== ===== =====
Manganese ore production(8)
(kwmt) 581 668 581 505 580 598 668
====================================== ===== ===== ===== ===== ===== ===== =====
Manganese ore sales(8) (kwmt) 517 566 517 586 497 636 566
====================================== ===== ===== ===== ===== ===== ===== =====
Ore grade sold (%, Mn) 39.7 40.3 39.7 40.0 40.6 39.5 40.3
====================================== ===== ===== ===== ===== ===== ===== =====
Manganese alloy production (kt) - - - - - - -
====================================== ===== ===== ===== ===== ===== ===== =====
Manganese alloy sales (kt) 8 - 8 3 - - -
====================================== ===== ===== ===== ===== ===== ===== =====
Cerro Matoso (99.9% share)
====================================== ===== ===== ===== ===== ===== ===== =====
Ore mined (kwmt) 645 1,058 645 825 594 1,174 1,058
====================================== ===== ===== ===== ===== ===== ===== =====
Ore processed (kdmt) 698 620 698 457 528 702 620
====================================== ===== ===== ===== ===== ===== ===== =====
Ore grade processed (%, Ni) 1.58 1.76 1.58 1.55 1.60 1.76 1.76
====================================== ===== ===== ===== ===== ===== ===== =====
Payable nickel production (kt) 10.0 9.6 10.0 6.1 7.1 10.9 9.6
====================================== ===== ===== ===== ===== ===== ===== =====
Payable nickel sales (kt) 10.4 10.4 10.4 6.1 6.7 10.3 10.4
====================================== ===== ===== ===== ===== ===== ===== =====
Cannington (100%)
====================================== ===== ===== ===== ===== ===== ===== =====
Ore mined (kwmt) 700 750 700 709 714 696 750
====================================== ===== ===== ===== ===== ===== ===== =====
Ore processed (kdmt) 630 687 630 672 724 720 687
====================================== ===== ===== ===== ===== ===== ===== =====
Silver ore grade processed (g/t,
Ag) 169 185 169 179 177 213 185
====================================== ===== ===== ===== ===== ===== ===== =====
Lead ore grade processed (%,
Pb) 5.0 5.5 5.0 5.2 5.8 6.6 5.5
====================================== ===== ===== ===== ===== ===== ===== =====
Zinc ore grade processed (%,
Zn) 2.9 3.2 2.9 3.7 3.5 3.9 3.2
====================================== ===== ===== ===== ===== ===== ===== =====
Payable Zinc equivalent production(9)
(kt) 64.1 78.2 64.1 76.4 81.4 97.1 78.2
====================================== ===== ===== ===== ===== ===== ===== =====
Payable silver production (koz) 2,863 3,493 2,863 3,130 3,484 4,178 3,493
====================================== ===== ===== ===== ===== ===== ===== =====
Payable silver sales (koz) 2,967 2,718 2,967 3,359 2,950 4,460 2,718
====================================== ===== ===== ===== ===== ===== ===== =====
Payable lead production (kt) 26.4 31.9 26.4 31.2 33.0 41.2 31.9
====================================== ===== ===== ===== ===== ===== ===== =====
Payable lead sales (kt) 29.5 25.3 29.5 31.9 28.4 41.9 25.3
====================================== ===== ===== ===== ===== ===== ===== =====
Payable zinc production (kt) 12.4 15.4 12.4 18.0 17.8 19.5 15.4
====================================== ===== ===== ===== ===== ===== ===== =====
Payable zinc sales (kt) 11.8 14.3 11.8 20.0 15.9 21.3 14.3
====================================== ===== ===== ===== ===== ===== ===== =====
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,
particularly in light of the current economic climate and the
significant volatility, uncertainty and disruption arising in
connection with COVID-19.
Further information
INVESTOR RELATIONS MEDIA RELATIONS
Tom Gallop Miles Godfrey Jenny White
M +61 439 353 948 M +61 415 325 906 M +44 7900 046 758
E Tom.Gallop@south32.net E Miles.Godrey@south32.net E Jenny.White@south32.net
21 October 2021
Approved for release by Graham Kerr, Chief Executive Officer
JSE Sponsor: UBS South Africa (Pty) Ltd
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END
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