Strong aluminium and copper sales boost South32’s first-half profit

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Strong aluminium and copper sales boost South32’s first-half profit

9:06 CAT | 13 Feb 2025

File photo: Reuters

South32 reinstated its production forecasts for fiscal 2026, and slightly lowered them for this year, for its Mozal Aluminium smelter in Mozambique. It had withdrawn the forecasts in December, following civil unrest in the country.

Australian diversified miner South32 reported an over nine-fold surge in first-half profit on Thursday and beat analysts’ estimates, driven by higher aluminium and copper sales and strong commodity prices.

Shares of the company rose 2.3% in early trade, compared with a 1.1% rise in the broader miners’ sub-index.

An uptick in aluminium prices, spurred by a constrained alumina market and supply deficit, led to the company’s aluminium division posting an increase in underlying operating earnings of $160 million for the first half.

Earnings for the copper division also increased by $98 million, boosted by higher prices and lower labour costs.

South32, the world’s biggest manganese producer, said its underlying earnings for the half-year ended December 31 were $375 million, up from $40 million a year ago. That beat a Visible Alpha consensus estimate of $370.1 million.

The Perth-based miner, which separated from BHP Group in 2015, declared an interim dividend of 3.4 cents per share, compared with 0.4 cent a year earlier.

South32 reinstated its production forecasts for fiscal 2026, and slightly lowered them for this year, for its Mozal Aluminium smelter in Mozambique. It had withdrawn the forecasts in December, following civil unrest in the country.

The firm raised its full-year unit operating costs forecast for its Worsley Alumina project in Western Australia by 5%.

Analysts at Citi called the result “solid”, but said that cost pressures for the miner were still evident.

However, South32 also trimmed its full-year group capital expenditure forecast, excluding exploration and intangibles, by about $105 million.

Source: Reuters