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Meanwhile, former BHP spin-off South32 cited weather and COVID-19 disruptions as its main challenges, as it recorded mixed production results for the year across its various commodity arms; which include alumina, aluminium, coal, copper and its world-leading production of steel-making ingredient manganese.
The Australian mining company reported its Worsley Alumina operations in Western Australia achieved record annual output of 3.99 million tonnes, up 1 per cent from last year, while its coal mining operation in Illawarra was hit by COVID-19 absenteeism and the wet weather in NSW.
“Our teams delivered another strong operating performance in the June quarter, despite challenges that included extreme weather, supply chain disruptions and reduced labour availability caused by the COVID-19 pandemic,” chief executive Graham Kerr said.
South32 CEO Graham Kerr.Credit:Trevor Collens
“Record annual production at Worsley Alumina, along with record quarterly production at South Africa Manganese and a strong sales result in June, capturing the benefit of high prices, capped another year of substantial progress for South32.”
RBC Capital Markets analysts said South32’s quarterly result was mixed, with copper equivalent production 3 per cent lower than the bank expected and 1 per cent lower than the company’s guidance, but prices were higher than anticipated across other key commodities.
In the last quarter, South African manganese production jumped 22 per cent to break a record for the company, but metallurgical coal output was 10 per cent lower than consensus estimates.
Aluminium output was also 5 per cent higher in the June quarter compared to the March period, but production was still below RBC expectations as the company’s ramp-up of its Brazilian smelter operations was slower than expected. South32 announced in January that the smelter – which is owned jointly with Alcoa – would be powered only using renewable energy.
South32’s share price moved 0.9 per cent higher to close at $3.56.
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