It certainly has been a busy week for Australia’s leading mining companies. Over the last couple of days both BHP Group Ltd (ASX: BHP) and Rio Tinto Limited (ASX: RIO) have released their latest quarterly updates.
And today it is the turn of BHP spin-off South32 Ltd (ASX: S32) to release its own results. But unlike the other two, which were trading close to 52-week highs, expectations have been very low for South32.
So much so, the diversified miner’s shares dropped to a 52-week low of $3.00 on Wednesday.
How did South32 perform in the fourth quarter?
South32 had a positive fourth quarter, reporting quarter on quarter increases in production for all metals except manganese ore.
Amongst the highlights were alumina production which increased 9%, energy coal which rose 12%, metallurgical coal which increased 29%, and manganese ore production which lifted 19%.
A full summary of its production over the quarter and FY 2019 is shown below:
South32’s CEO, Graham Kerr, was very pleased with the way the miner finished the year.
He said: “We had a strong finish to the year, with revenue equivalent production growing 10 per cent in the quarter and 3 per cent for the year. We achieved record annual production at Hillside Aluminium, increased production at Illawarra Metallurgical Coal by 57 per cent and delivered 5.5 million tonnes of manganese ore into a favourable market.”
Mr Kerr added: “We reached a key milestone at our Hermosa project declaring a Mineral Resource for the Taylor Deposit, de-risking our investment and increasing our confidence in the project as we advance the pre-feasibility study during FY20.”
The company also revealed that it has now received bids for its struggling South Africa Energy Coal business. South32 is now engaging with the bidders regarding the finalisation of their offers and expects to provide a further update during the first half of FY 2020.
Overall, I felt this was a solid update from South32 compared to previous quarters and wouldn’t be surprised to see its shares charge higher today.
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