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Bloomberg reported that South32 (ASX:S32) reported a 10 percent jump in first quarter alumina output after maintenance work was completed in Australia.
Bloomberg reported that South32 (ASX:S32) reported a 10 percent jump in first quarter alumina output after maintenance work was completed in Australia.
As quoted in the market news:
Production in the three months to Sept. 30 was 1.36 million metric tons, from 1.24 million tons a year earlier, when the assets were operated by BHP, the Perth-based company said Thursday in a statement. That compares to a UBS Group AG forecast of 1.32 million tons.
South32 forecasts it will cut costs by 25 percent this fiscal year and also expects to complete a review of manganese production in South Africa by December. Aluminum output from South Africa is forecast to decline marginally in fiscal 2016 should some temporary suspensions and current markets prevail, it said in the statement.
“We continue to take decisive action to maximize financial performance, rather than volume,” Chief Executive Officer Graham Kerr said in the statement. Producers including Glencore Plc and Freeport-McMoRan Inc. are trimming output of metals from copper to zinc amid weaker prices.
Even as wider demand for metals to energy falters in China to send prices plunging, the nation faces an alumina shortage of 4.6 million tons this year, which may rise 6.6 million tons in 2017, according to Alumina Ltd. The material, used in the production of aluminum, is South32’s biggest earning unit, accounting for 35 percent of earnings before interest and taxes, UBS said in an Oct. 19 note to clients.
South32’s full-year earnings rose 41 percent boosted by its aluminum and alumina operations, the company said in August. The company’s shares rose 3.1 percent to A$1.495 at Thursday’s close in Sydney and have declined 27 percent since its trading debt in May.
