The South32 Ltd (ASX: S32) share price is having a strong session on Thursday.
Following the release of its half year results, the mining giant's shares are up 1.5% to $3.48.
South32 share price higher on strong profit growth
- Revenue from continuing operations up 25% to US$3.12 billion
- Operating profit of US$520 million
- Profit after tax up 577% to US$359 million
- Interim dividends per share of 3.4 US cents
What happened during the half?
For the six months ended 31 December, South32 delivered an impressive turnaround in its performance with a significant jump in profitability compared to the prior corresponding period.
On the top line the mining giant reported a 25% increase in revenue from continuing operations to US$3.12 billion. Whereas operating profit swung from a US$52 million loss to a US$520 million profit, and net profit after tax surged 577% to US$359 million.
Commenting on the turnaround, South32 CEO Graham Kerr said:
We achieved strong operating results across our portfolio in H1 FY25, including increasing aluminium production by 5 per cent and copper production by 16 per cent. This enabled the Group to capitalise on improved commodity prices, with Underlying EBITDA increasing by 44 per cent to US$1 billion in H1 FY25
South32's earnings per share rose from 1.2 US cents to 8 US cents. This allowed the company's board to increase its dividend by a whopping 750% to 3.4 US cents per share.
Commenting on the dividend, Kerr added:
Demonstrating our strong financial position, track record of returning excess capital to shareholders and positive outlook for the business, today we announced a fully-franked interim ordinary dividend of US$154 million (US 3.4 cents per share) and the continuation of our capital management program, with US$171 million remaining to be returned to shareholders.
Outlook
Also potentially giving the South32 share price a boost today is news that management has reiterated its guidance for FY 2025 for everything but Mozal Aluminium. It continues to be impacted by unrest in Mozambique.
Speaking about the remainder of the financial year, South32's CEO said:
FY25 production guidance remains unchanged, except for Mozal Aluminium where we have updated production guidance as we continue to mitigate the impact of civil unrest in Mozambique. Our operating discipline and weaker producer currencies are expected to support lower operating unit costs for the majority of our guided operations in H2 FY25.
We are focused on continuing our strong operating performance into the second half, unlocking value from our growth pipeline and continuing to reward shareholders as our financial performance improves.
The South32 share price is up 13% since this time last year.
