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SOUTH32 LIMITED - Quarterly Report

Release Date: 21/10/2021 09:19
Code(s): S32     PDF:  
Wrap Text
Quarterly Report

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

QUARTERLY REPORT 
SEPTEMBER 2021


•  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[note 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)[note 2]
•  Exercised our pre-emptive rights to acquire an additional interest in our hydro powered
   aluminium smelter, Mozal Aluminium[note 3]


“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 in Mozal 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


    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[note 1] increased by US$254M to US$660M during the quarter. 
   Notwithstanding our strong cash generation, which included net distributions[note 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[note 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[note 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[note 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%[note 6], Mozambique 0%[note 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 
     (South32 share)                                               
                                                                                 
                                               FY21        3M YTD FY22    FY22e[note a]
     Worsley Alumina
     Alumina production (kt)                   3,963        1,006         3,965
     Brazil Alumina
     Alumina production (kt)                   1,398          272         1,300
     Hillside Aluminium[note 7]
     Aluminium production (kt)                   717          180           720
     Mozal Aluminium[note 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[note 8] (kwmt)   2,264          668         2,200 
     Cerro Matoso
     Payable nickel production (kt)             34.1          9.6          43.8                                                  
     Cannington
     Payable zinc equivalent                   
     production[note 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
South32 share                                  YoY    1Q21  4Q21   1Q22     vs        vs
                               FY21  FY22
                                                                           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 [note 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
South32 share                                   YoY     1Q21   4Q21  1Q22    vs       vs
                               FY21     FY22
                                                                            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
South32 share                                    YoY     1Q21   4Q21   1Q22     vs     vs
                                 FY21    FY22
                                                                               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[note 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
South32 share                                    YoY      1Q21  4Q21  1Q22     vs     vs
                                  FY21    FY22
                                                                             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[note 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
 South32 share                                         YoY    1Q21    4Q21    1Q22   vs      vs
                                       FY21    FY22
                                                                                    1Q21    4Q21

 Total coal production (kt)           2,371   1,888   (20%)    2,371  1,725   1,888  (20%)    9%

 Total coal sales[note 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
 South32 share                                      YoY      1Q21  4Q21  1Q22    vs       vs
                                      FY21   FY22
                                                                                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[note 12].


SOUTH AFRICA MANGANESE (60% SHARE)

                                                                                1Q22       1Q22
                                           YTD     YTD
 South32 share                                           YoY   1Q21  4Q21 1Q22    vs        vs
                                          FY21    FY22
                                                                                 1Q21      4Q21

 Manganese ore production[note 8] (kwmt)   581     668   15%    581   598   668   15%       12%
 Manganese ore sales[note 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[note 13] on a volume weighted M-1 basis as we 
optimised our sales mix.


CERRO MATOSO (99.9% SHARE)

                                                                            1Q22     1Q22
                                     YTD    YTD
 South32 share                                     YoY    1Q21  4Q21  1Q22   vs       vs
                                     FY21   FY22
                                                                            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)                                  

                                      YTD    YTD
 South32 share                                     YoY   1Q21   4Q21    1Q22    1Q22     1Q22  
                                      FY21   FY22                                                    
                                                                                  vs     vs
                                                                                                                   
                                                                                1Q21     4Q21                                  
                                                                                                                                          
 Payable zinc equivalent production   64.1   78.2   22%    64.1   97.1    78.2   22%    (19%)
 [note 9] (kt)

 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

South32 share                         YTD     YTD
                                                       1Q21   2Q21  3Q21   4Q21    1Q22
                                      FY21    FY22

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[note 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
[note 8] (kwmt)                         581    668     581     505      580    598   668

Manganese ore sales[note 8]
(kwmt)                                  517    566     517     586      497    636   566





                                                       
South32 share                       YTD    YTD
                                                      1Q21    2Q21      3Q21   4Q21  1Q22
                                    FY21    FY22

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
                                    64.1      78.2      64.1  76.4      81.4  97.1    78.2
production[note 9] (kt)

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




Date: 21-10-2021 09:19:00
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