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South32 Reports Strong Manganese and Coal Quarterly Results
Oct. 18, 2018 02:55PM PST
South32 experienced strong production growth at its Australian manganese operations and at its Illawarra metallurgical coal operation in New South Wales.
South32( ASX:S32,LSE:S32) saw results flying off the page in a recently released quarterly report, which showed record quarterly performance from its Australian manganese operations and an 8 percent increase in total manganese ore production.
The company has manganese operations in both Australia and South Africa, both of which saw an 8 percent increase in saleable ore production during the September 2018 quarter.
South Africa’s numbers grew as production ramped up at the Wessels mine after a planned shutdown, with the company adding that it had taken advantage of “favorable” market conditions.
Meanwhile, the company also had strong results from its Illawarra Metallurgical Coal operation, which saw a total production increase of 54 percent to 1.9 million tonnes (Mt) during the quarter. South32 attributed the gains to strong performances from the Appin and Dendrobium longwalls after moves were made in the June 2018 quarter.
“Annual production guidance is maintained for all of our operations with Australia Manganese achieving another quarterly record and total manganese ore production increasing by 8 percent,” South32 CEO Graham Kerr said in the report.
He added, “Illawarra Metallurgical Coal also enjoyed a strong start to the year as an improvement in longwall productivity underpinned an annualized production rate of 7.6Mt in the quarter.”
“We finished the period with a net cash balance of US$679 million and additional funds in our manganese joint venture as our key commodity markets benefited from robust demand and pricing.”
Going forward, Illawarra’s production guidance remains the same at 6.1 Mt as development rates will become a greater focus for the company with two longwall moves set to be completed during FY19.
According to the company, the increased development rates will be integral to sustain the operation of two longwalls simultaneously at the Appin colliery.
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Securities Disclosure: I, Olivia Da Silva, hold no direct investment interest in any company mentioned in this article.
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