South32 (S32) Q2 2026 earnings summary

Executive summary

• Maintained consistent operating results with FY26 production guidance unchanged across operated assets and unit costs tracking in line with guidance.

• Completed divestment of Cerro Matoso, simplifying the portfolio and focusing on high-quality base metals.

• Advanced construction at Hermosa's Taylor zinc-lead-silver project and completed the Clark manganese exploration decline.

• Sierra Gorda delivered strong copper volumes and cash returns, with further copper growth targeted.

• Ambler Metals JV approved a $35M work program to advance the Arctic polymetallic deposit in Alaska.

Financial highlights

• Received $240M in net distributions from equity accounted investments in H1 FY26, including $180M from Sierra Gorda and $60M from manganese.

• Returned $152M to shareholders in H1 FY26: $117M in dividends and $35M via share buy-back.

• Group tax payments (excluding EAIs) totaled $129M in H1 FY26.

• Working capital build of ~$130M expected in H1 FY26 due to higher commodity prices and sales timing.

• Additional lease liabilities of ~$63M added to the balance sheet in H1 FY26.

Outlook and guidance

• FY26 production guidance maintained for all operated assets; Brazil Aluminium guidance under review pending ramp-up profile.

• H1 FY26 operating unit costs tracking in line with or below guidance for most operations.

• Drawdown of Mozal Aluminium inventory expected to boost cash generation in H2 FY26.

• Group underlying effective tax rate for H1 FY26 expected to be ~34%.