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FY24 half year financial results released

15 FEBRUARY 2024

Alongside the release of our financial results for H1 FY24 we have announced a US$2,160 million investment in Hermosa’s Taylor zinc-lead-silver deposit.

During the half, we delivered Underlying EBITDA of US$708 million, as record Group aluminium production was offset by commodity price headwinds, and lower metallurgical coal volumes as we completed planned longwall moves at Illawarra Metallurgical Coal.

“We continued our rigorous focus on costs identifying further opportunities to drive efficiencies”, said Graham Kerr, South32 Chief Executive Officer, “This supported FY24 Operating unit cost guidance being lowered or held unchanged across the majority of our operations, along with lower FY24 capital expenditure guidance at our operations through capital efficiencies and the deferral of certain non-critical projects.”

Watch: Graham Kerr, South32 CEO, discusses our half year financial results and investment in Hermosa's Taylor deposit

Developing Hermosa

Alongside today’s results announcement, we have taken the next step in our portfolio transformation by announcing a US$2.16 billion investment in the Taylor zinc-lead-silver deposit at our Hermosa project in Arizona, with first production expected in H2 FY27.

“This investment is a major milestone for our business, that further reshapes our portfolio towards commodities critical to a low-carbon future,” said Graham.

Taylor is expected to deliver value for shareholders for decades to come and underpin further growth phases at our regional scale Hermosa project, establishing it as a globally significant producer of commodities critical for a low-carbon future.

Read more about the Investment approval for Hermosa's Taylor deposit

Improving outlook

Looking ahead to the second half, we expect to deliver a 7% increase in Group payable copper equivalent production in H2 FY24 following the completion of planned longwall moves at Illawarra Metallurgical Coal in H1 FY24, the continued ramp up of the Brazil Aluminium smelter, and sequentially higher base metals volumes from Sierra Gorda and Cerro Matoso.

“We remain focused on driving operating performance and cost efficiencies across our business,” said Graham, “This focus, combined with our expected 7 per cent production uplift in the second half, places us in a strong position to capture higher margins as market conditions improve."

In addition to our investment in Taylor, we continue to invest to unlock value across our business.

We remain on track for a final investment decision for the fourth grinding line expansion at Sierra Gorda during the fourth quarter of FY24 and continue to progress more than 25 greenfield exploration options in base metals.

See the ASX announcement - Financial Results and Outlook - half year ended 31 Dec 2023