South32 Reports Net Cash and Production Decline in Q1 2020

South32 Limited (ASX, LSE, JSE Share Code: S32) reports that the Quarter ended March 2020 production of almost all of company’s commodities decreased compared to the previous and corresponding periods of 2019.

South32 reports that the Company:

Responded to market conditions to maintain the financial strength of our
business by suspending the remaining US$121M of our current
on-market share buy-back program and lowering FY20 sustaining capital
expenditure guidance, including equity accounted investments,
to US$500M.
• Initiated a Group wide review that is expected to deliver a reduction in
controllable costs across our operations from FY21.
• Net cash declined by US$127M to US$150M during the quarter as we
funded our interim ordinary and special dividends (US$107M), made our
subscription payment for our 50% interest in the Ambler Metals Joint
Venture (net, US$73M) and bought back a further 53M shares through our
on-market share buy-back program (US$77M).
• Removed guidance for our operations in South Africa and Colombia and
lowered FY20 production guidance at Australia Manganese by 5%,
in response to restrictions aimed at containing the spread of COVID-19.
• Received government approval to undertake limited activity at our South
African manganese ore and export coal operations during the national
lockdown, remobilising at a reduced rate in April.
• Maintained FY20 guidance for all other operations, where to date
production and sales have been unaffected by our response to COVID-19.
• Increased Alumina production by 4% achieving record year to date
production at Brazil Alumina and maintaining higher rates of calciner
availability at Worsley Alumina as we deliver initiatives to sustainably
increase to nameplate capacity.
• Delivered record year to date production at Hillside Aluminium, where the smelter has a government exemption to maintain production during the
lockdown.
• On-track to return to a three longwall configuration in the June 2020 quarter at Illawarra Metallurgical Coal, where study work to further optimise production, sustaining capital and operating costs to maximise long term value has been advanced following strong longwall performance.

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