23rd Aug 2018 09:16
LONDON (Alliance News) - Miner South32 Ltd reported on Thursday a solid increase in annual earnings as higher commodity prices boosted the company's financials.
For the six months to June, South32's pretax profit was flat at USD1.62 billion, but underlying earnings before interest, tax, depreciation, and amortisation increased 4% to USD2.52 billion.
The company's revenue was USD7.55 billion, 9% higher year-on-year, with the figure boosted by stronger commodity prices, which overcame a 7% drop in sales volume and inflationary pressure, notably in the supply chain for aluminium.
South32 announced production figures for its year in July, showing a 10% rise in manganese ore output, flat aluminium, a 44% fall in metallurgical coal, a 6% drop in energy coal, but a 20% rise in nickel, with others such as lead, zinc, and silver all falling as well.
The company's total dividend for the period is 10.5 cents per share, compared to 10 cents per share a year earlier. It also paid a 3 cent special dividend at the halfway point of its year.
Free cash flow was USD873 million from USD1.49 billion, but net cash has increased to USD2.04 billion from USD1.64 billion.
Looking forward, South32 expects group production to rise 5% year-on-year in its newly begun financial year, and it said plans to manage South Africa Energy Coal as its own business which will simplify the company and deliver USD50 million of cost savings in 2020.
Overall, Chief Executive Graham Kerr said, the company is well positioned going forward.
London shares were 2.8% higher on Thursday at 193.40 pence each, while in Johannesburg the stock was 1.1% higher at ZAR35.70.
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