Australian metals miner South32 Limited released results for the first half of FY 2018-19 on Thursday, turning in production numbers essentially level with previous periods but respectable growth in financial returns.
In the fiscal year’s first half the firm reported revenue of US$3,811 million, up by 9 percent on the year from last year’s total of US$3,494 million. South32’s first half saw a profit of US$908 million, a leap of 35 percent above last year’s first-half profit of US$673 million. After taxes, the firm’s first-half profit came to US$635 million, 17 percent above last year’s post-tax profit of US$543 million.
On the production front, South32 reported refining 1,906 thousand metric tons of alumina at the Worsley refinery in the half, projecting a full-year total of 3,965 thousand metric tons, roughly equal to that of last year. Non-operated Brazil Alumina registered 636 thousand metric tons of refined alumina in the half, on pace for level pegging at a total of 1,355 thousand metric tons of alumina by year’s end. Hillside Aluminium smelted 360 thousand metric tons of aluminium in the half, setting it up for a year-end total of 720 thousand metric tons, which is generally in line with prior years’ production. Mozal Aluminium churned out 135 thousand metric tons of primary aluminium in the fiscal’s first half, setting it on a pace to remain steady with 269 thousand metric tons.
Reflecting upon the first half’s financial and production results, South32’s CEO Graham Kerr noted the strong showing of his firm in the half, saying it is a prelude to even better results going forward.
“Record production at Australia Manganese, strong operating performance more broadly and higher commodity prices delivered a 17 per cent increase in Profit after tax for the half year, while Underlying earnings per share grew by 20 per cent as we continued to benefit from our on-market share buy-back program.
“Our strong start to the year means that our production guidance is unchanged for all of our operations with the exception of Illawarra Metallurgical Coal where we have upgraded guidance by 7 per cent. We have also lowered our unit cost guidance as we have maintained operating discipline and benefited from a stronger US dollar.”
“We are well positioned for the second half of the year, with a net cash balance of US$678M and an improving outlook for production and costs,” he concluded. “This strong position has allowed us to return US$511M to shareholders in respect of the period with today’s declaration of a US$258M fully franked interim dividend and an US$86M fully franked special dividend.”
Based in Perth, Western Australia, South32 began in 2015 as a spin-off of BHP Billiton. The firm operates mines in Australia and South Africa, and markets aluminium, manganese, silver, zinc, lead, nickel, coking coal, and thermal coal.