South32 (S32) H2 2025 earnings summary

Executive summary

• Achieved strong operational performance with 20% copper and 6% aluminum production growth year-over-year, supporting a 7% increase in underlying EBITDA to $1.93 billion and underlying earnings of $666 million.

• Portfolio streamlined through the sale of Illawarra Metallurgical Coal and agreement to divest Cerro Matoso, focusing on high-margin, energy transition commodities.

• Safety performance improved, with ongoing safety leadership initiatives following a fatal incident at Cerro Matoso.

• $517 million invested in Hermosa to support future base metals production; ended the year with net cash of $123 million.

Financial highlights

• Profit after tax rose to $213 million from a loss of $203 million in FY24; underlying earnings increased to $666 million.

• Underlying EBITDA grew 7% to $1.93 billion year-over-year; operating margin improved to 26%.

• Operating free cash flow rose by $272 million; net cash position improved by $885 million to $123 million.

• $517 million invested in future base metals production at Hermosa; $350 million returned to shareholders.

• Announced fully franked ordinary dividend of $117 million ($2.60/share) and extended capital management program with $144 million to be returned.

Outlook and guidance

• Positive operating momentum expected into FY26, with new bauxite mining areas at Worsley Alumina and improved bauxite availability supporting a 4% production increase by FY27.

• Alumina and aluminium refineries expected to operate near nameplate capacity in FY27; Brazil Aluminium ramp-up continues.

• FY26 capital expenditure guidance lowered by ~$100 million to $750 million, with focus on Worsley Alumina and Hermosa's Taylor project.

• Hillside aluminum volumes to increase by 16% in FY26 and 3% in FY27; Mozal Aluminium expected to be placed on care and maintenance in March 2026 due to electricity supply uncertainty.

• Cannington mine life extended to six years, with potential for further extension.