South32 First-Quarter Report

Manganese Ore

Australia Manganese achieved a 2% increase in saleable production, reaching 890,000 wet metric tons in the September 2023 quarter. This growth was driven by strong primary output and the operation's efficient performance, with the low-cost PC02 circuit operating above its design capacity, contributing approximately 11% to the overall production.

South Africa Manganese also exhibited a strong performance, with a 7% increase in saleable production, setting a new record of 628,000 wet tons during the September 2023 quarter. The company maintains its unchanged FY24 production guidance, with planned maintenance scheduled for the December 2023 and March 2024 quarters.

Alumina Output

Worsley Alumina experienced a minor decline in saleable production, down by 4% to 972,000 tons during the September 2023 quarter. This decrease was attributed to planned calciner maintenance. However, the FY24 production guidance remains unchanged. The refinery is expected to operate at its nameplate capacity of 4.6 million tons (100% basis) throughout the year. Additional planned calciner maintenance is scheduled for the March 2024 quarter.

Brazil Alumina, on the other hand, witnessed a significant increase in saleable production, rising by 34% to 318,000 tons in the September 2023 quarter. This improvement was a result of the refinery's recovery from temporary port infrastructure outages that occurred in the previous quarter.

Aluminum Production

Brazil Aluminium's saleable production remained steady at 24,000 tons during the September 2023 quarter. The smelter continued its progress in ramping up all three potlines. The company has initiated export sales of its share of the smelter's aluminum production, with initial sales volumes established with domestic customers. It is anticipated that export sales will commence and inventory levels will return to normal during the December 2023 quarter.

Hillside Aluminium Saleable Production Remains Steady

The saleable production of Hillside Aluminium remained unchanged at 180,000 tons during the September 2023 quarter. Despite facing challenges due to elevated load-shedding, the smelter continued to operate at its maximum technical capacity. This achievement was made possible through ongoing testing and optimization efforts.

Mozal Aluminium Shows Growth in Saleable Production

In the September 2023 quarter, Mozal Aluminium experienced a 2% increase in its saleable production, reaching 84,000 tons. The smelter implemented strategic initiatives to maximize equipment utilization and ensure pot stability. While elevated load-shedding posed challenges, Mozal Aluminium effectively managed its impact and achieved the planned growth.

Copper Output Faces Challenges

Sierra Gorda's payable copper equivalent production decreased by 10%, reaching 20,300 tons in the September 2023 quarter. The decrease was primarily driven by lower planned copper grades, which overshadowed the positive impact of higher plant throughput resulting from the debottlenecking project. Sierra Gorda, however, remains committed to progress the feasibility study for the fourth grinding line expansion, with completion expected in the June 2024 half-year.

Metallurgical-Coal Output Declines

Illawarra Metallurgical Coal witnessed a decline of 33% in its saleable production, reaching 1.168 million tons during the September 2023 quarter. This reduction was attributed to an extended planned longwall move at the Dendrobium mine. On a positive note, a new four-year industrial agreement covering deputies at the Appin mine was successfully finalized after the end of the quarter.

Nickel Production Faces Challenges, but Guided Growth Ahead

Cerro Matoso witnessed a 19% decrease in payable nickel production, reaching 8,300 tons during the September 2023 quarter. This decline was due to planned maintenance activities and a temporary reduction in third-party gas supply. Additionally, nickel grades were sequentially lower in accordance with the mine plan. However, the production guidance for FY24 remains unchanged. Cerro Matoso expects improved plant throughput and nickel grades in the coming months, ensuring a positive outlook for the remainder of the year.