South32 (S32.L)
Q1 2017 results impacted by metallurgical coal production at Illawarra. Challenging geological conditions encountered at Appin Area 9 and 7 caused a decrease is saleable production by 26% (646kt) to 1.4Mt. Coal sales of 9.3Mt now expected in FY17 as the operation has recovered and finished good inventory has been reduced by 300kt. FY 17 metallurgical coal production has been reduced to 9Mt from 9.5Mt and unit cost guidance of US$71/t will not be achieved until June 2017 half year. Costs will be higher by $4/t in the December 2016 half year.
Restarted production in 22 pots at South Africa Aluminium as power availability improved. South Africa Manganese mines now operating at optimised 2.9Mwmt pa rate (100% basis) following the decision to stop work at the Wessels underground mine in June 2016.
Entered into an agreement with Alcoa to access bauxite in close proximity to Worsley Alumina mining infrastructure.
Net cash position increased by US$239M to US$551M.
Q1 2017 versus Q1 2016:
- Silver production is down 25% to 4.6M oz.
- Lead production is down 22% to 38.4Mt
- Manganese ore production down 18% to 1.1Mt
- Zinc production down 10% to 17.7Mt
- Manganese alloy production down 9% to 59kt
- Energy coal production down 6% to 8.1Mt
- Alumina production down 5% to 1.2Mt
- Aluminium production was flat at 243kt
- Nickle production flat at 8.7kt.
“The combination of a strong balance sheet and operating leverage ensures we are well positioned to deliver superior performance as we optimise our operations, unlock their potential and identify opportunities beyond our current portfolio.” Graham Kerr, South32 CEO