Kumba Iron Ore (KIO) H1 2026 earnings summary

Executive summary

• Delivered resilient operational and financial performance despite significant headwinds, including record rainfall, higher input costs, currency and logistics challenges, and lower realized prices.

• Maintained a strong safety record, with over 10 years of fatality-free production at Sishen and over three years at Kolomela.

• Advanced the UHDMS project, now 45% complete, with major procurement finalized and commissioning of first modules underway.

• Sustainability strategy updated, with progress in decarbonization and renewable energy initiatives at Kolomela and Sishen, including a 63 MW solar PV plant agreement.

• Women now represent 32% of the workforce.

Financial highlights

• Revenue declined 11% year-over-year to R30.9 billion, mainly due to lower realized prices and FX headwinds.

• EBITDA fell 32% to R10.9 billion, with margin narrowing to 35%; operating profit decreased 42% to R7.5 billion.

• Interim dividend of R7.90 per share declared, totaling R2.5 billion, with a payout ratio of 60%.

• Net cash position at R12.1 billion at period end, despite higher capex and lower free cash flow.

• Capex for H1 totaled R5.2 billion, mainly for UHDMS and mining fleet recapitalization.

Outlook and guidance

• Production guidance for 2026: 31–33 Mt; sales: 35–37 Mt; C1 unit cost guidance at ~US$45/wmt.

• Capex guidance for 2026: R13.2–14.2 billion, with expansion capex to decrease after 2026.

• Focus on cost optimization, operational efficiency, and enhancing cash generation.

• Full Potential programme targets at least 10% cost reduction over the medium term.

• Cost environment remains volatile due to geopolitical risks and inflationary pressures.