The South32 Ltd (ASX: S32) share price is lifting on Thursday after the company reported its FY24 earnings results.
Shares in the global mining and metals company are currently swapping hands at $3.09 apiece, less than 1% higher on the day.
Meanwhile, the S&P/ASX 200 Index (ASX: XJO) is less than 1% in the red at the time of writing.
Let's see what the company posted.
South32 share price gains on full-year results
Here are the key takeaways from South32's FY24 results:
- Revenue from continuing operations dropped 3% year over year to US$5.5 billion
- Earnings before interest, tax, depreciation and amortisation (EBITDA) of US$1.8 billion, down 29% from FY23
- Net loss increased by 18% year over year to US$205 million
- Dividends per share decreased to 3.5 US cents, down 57% from last year
What else happened in FY24?
The South32 share price had a volatile year in FY24, fluctuating alongside broader commodity prices. Revenues were down 3% due to lower commodity prices and lower production volumes.
This saw underlying EBITDA compress by 29% over the year, which "more than offset" efforts to reduce operating costs.
Segment-wise, alumina sales were flat year over year, copper sales decreased by 15%, whereas zinc production was up by 10%. This was due to higher realised metal grades.
Meanwhile, nickel and Australian manganese production was "unchanged" and decreased by 34% year over year.
South also completed the sale of its Illawarra Metallurgical Coal business during the year. The aim of the sale was to simplify South32's operations and strengthen its balance sheet.
In total, the company's metallurgical coal production was down 24% compared to last year, reflecting these moves.
Despite these results, the board announced a US$140 million fully-franked dividend for H2 FY24 and a US$200 million on-market share buyback. This could impact the South32 share price.
What did management say?
South32 CEO Graham Kerr acknowledged the difficulties faced during FY24 but remained optimistic about the company's future:
eflecting our strengthened financial position and disciplined approach to capital allocation, the Board has resolved to pay a US$140 million fully-franked ordinary dividend in respect of H2 FY24. The Board has also expanded our capital management program by US$200 million, to be returned via an on-market share buy-back, following the sale of Illawarra Metallurgical Coal.
The sale of Illawarra Metallurgical Coal simplifies our portfolio, strengthens our balance sheet and unlocks capital to invest in our development projects and growth options in base metals.
In the near term, these investments include the development of the Taylor deposit and projects to grow our copper production at Sierra Gorda.
What's next?
Looking ahead, South32 plans to increase its base metals exposure, with a particular focus on the Taylor deposit at its Hermosa site. The company is also exploring new opportunities in regions with high potential for base metal discoveries.
CEO Kerr said the outlook was "positive" for the company moving forward:
[W]e are seeking to increase our base metals exposure over the longer-term by investing in a pipeline of growth options which are being advanced through study phases and a portfolio of exploration prospects in highly prospective regions.
Looking ahead, the outlook for our business is positive as we focus on safe and reliable operations, managing our costs, and capitalising on our transformed portfolio which, more than ever, is focused on commodities critical to a low-carbon future.
South32 share price snapshot
The South32 share price is lifting today as investors digest the metals and mining company's FY24 results. In the past 12 months, the stock is down more than 10%.
