REG - South32 Limited - Half Year Results and Outlook: 31 December 2025
12/02/2026 07:00
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RNS Number : 6764S South32 Limited 12 February 2026
APPENDIX 4D
SOUTH32 LIMITED
(ABN 84 093 732 597)
Results for announcement to the market
This page and the accompanying 63 pages comprise the half year end financial
information given to the Australian Securities Exchange (ASX) under Listing
Rule 4.2A. This statement includes the unaudited consolidated results of the
South32 Group for the half year ended 31 December 2025 (H1 FY26) compared
with the half year ended 31 December 2024 (H1 FY25).
The half year report should be read in conjunction with the Financial Report
for the year ended 30 June 2025. Figures in italics indicate that an
adjustment has been made since the financial information was previously
reported.
US$M H1 FY26 H1 FY25 % Change
Revenue from continuing operations((a)(b)) 2,809 2,884 (3%)
Profit/(loss) after tax attributable to members 1 (#_ftn1) 464 360 29%
Other financial measures
Underlying revenue((a)(b)) 4,008 3,850 4%
Underlying earnings attributable to members(1(a)(b)) 435 375 16%
(a) On 29 August 2024, South32 sold its shareholding in Illawarra
Metallurgical Coal to an entity owned by Golden Energy and Resources Pte Ltd
and M Resources Pty Ltd 2 (#_ftn2) . As a result, Illawarra Metallurgical
Coal was classified as a discontinued operation in the H1 FY26 and H1 FY25
results. Our H1 FY26 and H1 FY25 Group underlying financial measures include
the results of Illawarra Metallurgical Coal for our period of ownership as
well as finalisation adjustments for the upfront consideration.
(b) On 1 December 2025, South32 sold its shareholding in Cerro
Matoso to an entity owned by CoreX Holding B.V 3 (#_ftn3) . As a result,
Cerro Matoso was classified as a discontinued operation in the H1 FY26 and H1
FY25 restated results. Our H1 FY26 and H1 FY25 Group underlying financial
measures include the financial contribution from Cerro Matoso prior to its
sale.
Net tangible assets per share
Net tangible assets per ordinary share were US$2.02 as at 31 December 2025
(US$1.93 as at 30 June 2025) 4 (#_ftn4) .
Dividends
The Board has resolved to pay an interim dividend of US 3.9 cents per share
(fully-franked) for the half year ended 31 December 2025.
The record date for determining entitlements to dividends is 6 March 2026;
payment date is 2 April 2026.
FINANCIAL RESULTS AND OUTLOOK HALF YEAR ENDED 31 DECEMBER 2025
ASX / LSE / JSE Share Code: S32; ADR: SOUHY
12 February 2026
South32 delivers strong financial results and growth in base metals
"Our consistent operating performance and higher base and precious metals
prices underpinned strong financial results for the half.
"We delivered Underlying EBITDA of US$1.1B and 16 per cent growth in
Underlying earnings to US$435M.
"We have today announced a fully-franked interim ordinary dividend of US 3.9
cents per share (US$175M) in respect of the December 2025 half year.
"Reflecting our strong financial position and positive outlook for the
business, we have also increased our capital management program by US$100M to
US$2.6B, with US$209M remaining to be returned to shareholders.
"FY26 production and Operating unit cost guidance is unchanged across our
operated businesses, as we maintain a disciplined focus on delivering safe and
reliable operating performance.
"We're continuing work to grow our base metals production and unlock value
across multiple development horizons.
"At Hermosa, we advanced construction of our large-scale, long-life Taylor
zinc-lead-silver project. We're also continuing work to unlock value from
Hermosa's broader land package, today releasing further positive exploration
drilling results from the Peake copper deposit.
"At Cannington, we have today announced a 28 per cent increase in the
underground Ore Reserve, while also targeting further potential growth through
both underground and open pit development options.
"Sierra Gorda progressed options to grow future copper production, advancing
studies for the fourth grinding line project, and defining an exploration
target at Catabela Northeast which highlights the potential for future mine
life extension.
"As announced in December 2025, Mozal Aluminium will transition to care and
maintenance in March 2026 due to the inability to secure sufficient and
affordable electricity supply. We are working closely with our people and
stakeholders through this change.
"I'd like to thank our teams around the world for their work to deliver these
strong results, as we look to continue our positive momentum into the second
half of the year."
Graham Kerr, South32 CEO
Financial Highlights
US$M H1 FY26 H1 FY25 % Change
Revenue from continuing operations 5 (#_ftn5) 6 (#_ftn6) 2,809 2,884 (3%)
Operating profit/(loss) from continuing operations(5,6) 532 488 9%
Profit/(loss) after tax 463 359 29%
Profit/(loss) after tax attributable to members 7 (#_ftn7) 464 360 29%
Basic earnings/(loss) per share (US cents) 8 (#_ftn8) 10.3 8.0 29%
Ordinary dividends per share (US cents) 9 (#_ftn9) 3.9 3.4 15%
Ordinary shares on issue (million) 4,486 4,517 (0.7%)
Other financial measures 10 (#_ftn10)
Underlying revenue 4,008 3,850 4%
Underlying EBITDA 1,107 1,018 9%
Underlying EBITDA margin 28.2% 27.5% 0.7%
Underlying EBIT 747 663 13%
Underlying EBIT margin 19.1% 18.0% 1.1%
Underlying earnings attributable to members(7) 435 375 16%
Basic Underlying earnings per share (US cents)(8) 9.7 8.3 17%
ROIC 11.3% 9.5% 1.8%
Safety performance
Nothing is more important than the health, safety and wellbeing of our people.
We continue to implement our global Safety Improvement Program, including
investment in safety leadership through our LEAD Safely Every Day (LSED)
program, together with further simplification of our systems and improved
effectiveness of controls.
We achieved improved safety performance in H1 FY26, with lost time injury
frequency (LTIF) reducing by 36% to 0.9 (FY25: 1.4) and total recordable
injury frequency (TRIF) reducing by 24% to 2.8 (FY25: 3.7). Our leading
indicator, significant hazard frequency, increased to 245 for H1 FY26 (FY25:
196), indicating an improved hazard awareness and a more proactive reporting
culture.
Health and safety performance 11 (#_ftn11)
Performance metric H1 FY26 FY25
Fatalities from health and safety incidents 0 1
Total lost time injury frequency (LTIF) 0.9 1.4
Total recordable injury frequency (TRIF) 2.8 3.7
Total significant hazard frequency 245 196
People and culture
An inclusive culture and diverse workforce supports greater collaboration,
innovation and performance. We continue to focus on building a workforce that
represents the communities where we operate, and increasing the representation
of women in leadership roles.
We measure our inclusion and diversity progress through a set of measurable
objectives as described in the table below.
Inclusion and diversity performance(11)
Diversity representation (%) FY26 measurable objective H1 FY26 FY25
Women in our workforce Achieve at least 24.2%((a)) 24.1 23.1((b))
Women on our Board Maintain at least 40% 50.0 54.5
Women in Lead Team Maintain at least 40% 42.9 50.0
Women in leadership roles Achieve at least 23.6%((a)) 23.7 23.6((b))
Local workforce diversity Achieve at least 3 of 4 targets((a)) 3 5((b))
(a) FY26 measurable objectives have been updated following the
divestment of Cerro Matoso. Local workforce diversity has been revised to four
targets from five targets, with an objective to achieve three of the four
targets (75%).
(b) FY25 outcomes include Cerro Matoso. FY25 outcomes excluding
Cerro Matoso which was divested on 1 December 2025 are as follows: Women in
our workforce: 23.7%, Women in leadership roles: 23.1% and Local workforce
diversity: 4 targets met representing 100%.
Addressing climate change
We have set a target to halve our net operational greenhouse gas (GHG)
emissions (Scope 1 and 2) by FY35, from FY21 levels, and a long-term goal to
achieve net zero GHG emissions across all scopes (Scope 1, 2 and 3) by 2050.
Our approach to climate change is focused on positioning our portfolio for the
energy transition, reducing our operational GHG emissions, supporting GHG
emissions reduction across our value chains, and strengthening physical
climate resilience.
A non-binding advisory resolution in relation to our second Climate Change
Action Plan was passed by shareholders at our Annual General Meeting in
October 2025, with 90% of the votes cast in favour of the resolution. Our
Climate Change Action Plan 2025 is available on our website (www.south32.net
(http://www.south32.net) ).
Our operational GHG emissions increased by 16% in H1 FY26, reflecting an
increased reliance on coal-fired electricity at Mozal Aluminium due to reduced
hydroelectric power supply following drought conditions in Mozambique.
Greenhouse gas emissions
Million tonnes of CO(2) equivalent H1 FY26 H1 FY25
Operational GHG emissions 11.6 10.0
Business performance
Aluminium value chain
Alumina
Alumina saleable production increased by 3% to 2.6Mt in H1 FY26, as Brazil
Alumina achieved record half year production and Worsley Alumina delivered
planned volumes while completing scheduled calciner maintenance. FY26
production guidance remains unchanged at 5.1Mt.
Underlying EBITDA decreased by US$365M to US$178M in H1 FY26, for an operating
margin of 18%, as improved volumes were more than offset by a 27% decrease in
our average realised price of alumina.
Aluminium
Aluminium saleable production increased by 2% to 619kt in H1 FY26.
Hillside Aluminium saleable production was unchanged at 362kt in H1 FY26, as
the smelter continued to test its maximum technical capacity, despite the
impact of load-shedding. FY26 production guidance remains unchanged at
720kt 12 (#_ftn12) .
Mozal Aluminium saleable production increased by 3% to 183kt in H1 FY26. On 16
December 2025 13 (#_ftn13) , we announced Mozal Aluminium will transition to
care and maintenance on or around 15 March 2026 due to the inability to secure
sufficient and affordable electricity supply. FY26 production guidance for the
period to March 2026 remains unchanged at 240kt(12).
Brazil Aluminium saleable production increased by 16% to 74kt in H1 FY26.
Despite this growth, production in Q2 FY26 was below plan due to unplanned pot
outages and external energy disruptions. Production guidance has been revised
to 135kt (from 160kt) in FY26 and 140kt (from 165kt) in FY27, as the smelter's
operator implements measures to improve stability and continue the ramp-up of
all three potlines.
Underlying EBITDA increased by US$115M to US$251M in H1 FY26, for an operating
margin of 15%, reflecting a 6% increase in our average realised price of
aluminium and lower alumina input prices at Hillside Aluminium and Brazil
Aluminium.
Base metals
Sierra Gorda
Sierra Gorda payable copper equivalent production 14 (#_ftn14) was largely
unchanged at 47.0kt in H1 FY26, with plant throughput and copper production in
line with plan, while higher molybdenum output from the current mining phase
offset lower planned gold production.
FY26 production guidance(14) remains unchanged at 85.7kt (ore processed
21.8Mt, copper 72.0kt, molybdenum 1.2kt, gold 18.0koz and silver 600koz), with
the operation positioned to potentially exceed guidance if strong volumes of
molybdenum, gold and silver continue in H2 FY26.
Underlying EBITDA increased by US$178M to US$393M in H1 FY26, for an operating
margin of 68%, due to higher realised metal prices.
Sierra Gorda continued to invest in studies and exploration to support future
copper production growth.
Sierra Gorda is nearing completion of the feasibility study for the fourth
grinding line project, which has the potential to increase plant throughput by
~20% to ~58Mtpa (100% basis), after which the joint venture partners will
undertake an independent review to support a potential joint final investment
decision in mid‑CY26.
At the Catabela Northeast prospect, adjacent to the Catabela pit, we have
defined an Exploration Target 15 (#_ftn15) ranging from 1.1Bt @ 0.48% TCu to
2.9Bt @ 0.45% TCu, highlighting the potential for future mine life extension.
Further exploration activity and technical assessment will be completed in
CY26.
Cannington
Cannington payable zinc equivalent production 16 (#_ftn16) decreased by 18%
to 102.8kt in H1 FY26, as higher ore processed was more than offset by lower
planned metal grades. FY26 production guidance(16) remains unchanged at
200.6kt (ore processed 1,850kdmt, zinc 40.0kt, lead 87.0kt and silver
8,200koz).
Underlying EBITDA increased by US$81M to US$211M in H1 FY26, for an operating
margin of 53%, reflecting higher average realised metal prices and lower
costs.
We continued work on underground and open pit life extension options at
Cannington. This work has supported a further increase in the underground Ore
Reserve by 3Mt to 13Mt in H1 FY26, extending the reserve life by approximately
two years to FY33 17 (#_ftn17) . To support the extended mine life, we expect
to invest additional capital expenditure of approximately US$65M to US$80M
during FY27 and FY28, including for ventilation and electrical upgrades. Study
work for the potential open pit development is expected to tollgate to
pre-feasibility stage in CY26.
Hermosa project
We invested US$338M 18 (#_ftn18) of growth capital expenditure at Hermosa in
H1 FY26, as we progressed construction of the Taylor zinc-lead-silver project,
and completed the exploration decline for the Clark battery-grade manganese
deposit.
At Taylor, we continue to sink the ventilation and main shafts, while
progressing construction of surface infrastructure, following delivery of
major components of the primary mill and flotation circuit.
FY26 growth capital expenditure guidance remains unchanged at US$750M 19
(#_ftn19) .
As part of scheduled project execution at Taylor, an assessment of project
milestones and capital expenditure will be completed in H2 FY26. This
assessment will be informed by the pricing of additional underground and
surface infrastructure packages scheduled to be awarded during this period.
We also invested US$14M in capitalised exploration at Hermosa in H1 FY26,
continuing exploration drilling at the Peake deposit, which returned further
high-grade copper results 20 (#_ftn20) . Further exploration and study work
to support the potential to produce copper from Peake, leveraging the
infrastructure for Taylor, will continue in H2 FY26.
Exploration
We invested US$30M (US$20M capitalised) in exploration programs at our
existing operations and development options, including our Hermosa project and
equity accounted investments (EAI) in H1 FY26.
We also invested US$15M in greenfield exploration programs in H1 FY26, as we
continued work to discover our next generation of base metals mines.
We expanded our pipeline of copper exploration options in highly prospective
regions as we entered into strategic alliances with Orogen Royalties Inc.
targeting projects in western North America, and Aurum Discovery Limited,
focusing on early stage prospects in Norway and Ireland.
Cerro Matoso
Cerro Matoso payable nickel production decreased by 19% to 15.0kt in H1 FY26,
while Underlying EBITDA decreased by US$33M to US$11M in H1 FY26, reflecting a
period of five months of operations prior to its divestment to a subsidiary of
CoreX Holding B.V. on 1 December 2025 21 (#_ftn21) .
Manganese
Australia Manganese
Australia Manganese production increased to 1,660kwmt in H1 FY26, as the
operation achieved normalised production rates after executing its recovery
plan following the impacts of Tropical Cyclone Megan. FY26 production guidance
remains unchanged at 3,200kwmt, subject to potential wet season impacts.
Underlying EBITDA increased to US$107M in H1 FY26, with sales volumes
increasing to 1,809kwmt, as shipping rates reached full capacity following the
commissioning of new wharf infrastructure in Q4 FY25.
South Africa Manganese
South Africa Manganese production decreased by 2% to 1,057kwmt in H1 FY26, as
the operation completed planned maintenance and underground development at
Wessels. FY26 production guidance remains unchanged at 2,000kwmt, with further
planned maintenance scheduled in Q3 FY26.
Underlying EBITDA decreased by US$20M to US$8M in H1 FY26, due to lower
average realised manganese prices.
Financial performance
Profit and Loss
The Group's profit after tax attributable to members increased by US$104M to
US$464M in H1 FY26, as we delivered strong operating results and capitalised
on higher commodity prices. Underlying earnings attributable to members
increased by US$60M to US$435M in H1 FY26. A reconciliation of profit/(loss)
to Underlying earnings attributable to members is set out on page 10.
Underlying EBITDA increased by US$89M (or 9%) to US$1,107M for a Group
operating margin of 28.2% (H1 FY25: 27.5%). Our strong financial results were
driven by broadly higher commodity prices (+US$131M), notably copper, silver
and aluminium, lower controllable costs (+US$44M), and the restart of
operations at Australia Manganese (+US$100M). These benefits more than offset
lower contributions from Illawarra Metallurgical Coal (IMC) (-US$50M) and
Cerro Matoso (-US$21M) post divestment, as we continued to streamline our
portfolio towards higher-margin businesses in critical metals.
Underlying EBIT increased by US$84M (or 13%) to US$747M in H1 FY26, as
Underlying depreciation and amortisation was largely unchanged.
Cash Flow
Group free cash flow from operations, excluding EAIs, was an outflow of
US$183M in H1 FY26 (H1 FY25: US$116M outflow), which reflected an increase in
growth capital expenditure at Hermosa (-US$90M) and a temporary build in
working capital due to higher commodity prices and the timing of sales.
Separately, we received distributions 22 (#_ftn22) of US$240M (H1 FY25:
US$23M) from our EAIs in H1 FY26. This included a record distribution of
US$180M from Sierra Gorda (H1 FY25: US$86M), reflecting strong operating
performance and higher metal prices, and US$60M from our manganese business
(H1 FY25: US$63M of funding) as we finalised external insurance recoveries
related to Australia Manganese.
Group capital expenditure, excluding EAIs, exploration and intangibles,
increased by US$41M to US$498M in H1 FY26, as higher growth capital
expenditure at Hermosa (-US$90M) was partially offset by lower sustaining
capital expenditure (+US$77M) following the divestments of IMC and Cerro
Matoso.
Capital expenditure for our Sierra Gorda EAI, excluding exploration and
intangibles, increased by US$10M to US$116M in H1 FY26, as the operation
continued to invest in deferred stripping activity.
Capital expenditure for our manganese EAI, excluding exploration and
intangibles, decreased by US$8M to US$64M in H1 FY26, as Australia Manganese
executed its recovery plan in FY25, while South Africa Manganese completed
work to access new mining areas at Wessels.
We returned US$152M to shareholders during H1 FY26, with US$117M in
fully-franked ordinary dividends in respect of H2 FY25, and US$35M via our
on-market share buy-back 23 (#_ftn23) .
Balance Sheet
The Group finished the period with net debt of US$25M, with strong operating
results and higher EAI distributions supporting our investment in growth at
Hermosa (-US$338M) and returns to shareholders (-US$152M).
Dividends and Capital Management
Our unchanged capital management framework supports investment in our business
and rewards shareholders as our financial performance improves. Consistent
with our policy to distribute a minimum 40% of Underlying earnings
attributable to members as ordinary dividends, the Board has resolved to pay a
fully-franked interim ordinary dividend of US 3.9 cents per share (US$175M) in
respect of H1 FY26, representing 40% of Underlying earnings attributable to
members.
Reflecting our strong financial position and positive outlook for the
business, we have also increased our capital management program by US$100M to
US$2.6B, with US$209M remaining to be returned to shareholders by 26 February
2027 24 (#_ftn24) .
Earnings reconciliation
Consistent with our accounting policies, various items are excluded from the
Group's profit/(loss) to derive Underlying earnings 25 (#_ftn25) . Total
adjustments to derive H1 FY26 Underlying EBIT (+US$184M), shown in the table
below, include:
− Significant items (+US$54M): recognition of employee separation costs and
termination of contractual arrangements (+US$28M), and the write-down of raw
materials and consumables (+US$26M), at Mozal Aluminium as the smelter
transitions to care and maintenance 26 (#_ftn26) ;
− Joint venture adjustments 27 (#_ftn27) (+US$241M): to reconcile the equity
accounting position to a proportional consolidation basis for our manganese
and Sierra Gorda EAIs;
− Gain on the disposal of subsidiaries and joint operations (-US$21M):
recognition of cash proceeds from finalisation of the upfront consideration
for the sale of IMC (-US$19M) and gain on disposal of Cerro Matoso (-US$2M);
− Impairment reversal of financial assets (-US$77M): periodic revaluation of the
shareholder loan receivable from Sierra Gorda.
An offsetting amount is recorded in the Sierra Gorda joint venture adjustments
noted above; and
− Gain on non-trading derivative instruments and contingent consideration
measured at fair value through profit and loss (-US$21M): revaluation of the
contingent consideration receivable 28 (#_ftn28) from the sale of IMC
reflecting lower metallurgical coal prices (+US$33M) and determination that no
contingent consideration is payable 29 (#_ftn29) (-US$55M) in relation to our
acquisition of Sierra Gorda.
Further information on these adjustments is included in Note 3 Segment
information to the financial statements on page 43.
Profit/(loss) to Underlying EBITDA reconciliation
US$M H1 FY26 H1 FY25
Operating profit/(loss) from continuing operations 532 488
Operating profit/(loss) from discontinued operations 31 32
Adjustments to derive Underlying EBIT:
Significant items 54 -
Joint venture adjustments(27) 241 22
(Gains)/losses on the disposal of subsidiaries and joint operations (21) 47
Exchange rate (gains)/losses on the restatement of monetary items 8 7
Impairment losses/(reversals) of financial assets (77) 71
(Gains)/losses on non-trading derivative instruments and contingent (21) (4)
consideration measured at fair value through profit and loss
Total adjustments to derive Underlying EBIT 184 143
Underlying EBIT 747 663
Underlying depreciation and amortisation 360 355
Underlying EBITDA 1,107 1,018
Profit/(loss) to Underlying earnings attributable to members reconciliation
US$M H1 FY26 H1 FY25
Profit/(loss) after tax attributable to members 464 360
Total adjustments to derive Underlying EBIT 184 143
Total adjustments to derive Underlying net finance costs (86) (152)
Total adjustments to derive Underlying income and royalty related tax expense (127) 24
Underlying earnings attributable to members 435 375
Earnings analysis
The following key factors influenced Underlying EBIT in H1 FY26, relative to
H1 FY25.
Reconciliation of movements in Underlying EBIT (US$M) 30 (#_ftn30) 31
(#_ftn31)
Earnings analysis US$M Commentary
H1 FY25 Underlying EBIT 663
Change in sales price 131 Higher average realised prices for our commodities, including:
Silver (+US$142M)
Copper (+US$137M)
Aluminium (+US$100M)
Partially offset by lower average realised prices for alumina (-US$258M) as
prices declined from elevated levels in the prior period
Net impact of price-linked costs (29) Higher aluminium smelter raw material input prices, primarily coke (-US$22M)
Higher price-linked royalties at Cannington (-US$2M)
Change in exchange rates (25) Stronger South African rand (-US$20M) and Brazilian real (-US$10M)
Partially offset by a weaker Australian dollar (+US$5M)
Change in inflation (45) General inflation across Australia (-US$19M), South America (-US$10M) and
Southern Africa (-US$12M)
Inflation-linked indexation of electricity prices at Hillside Aluminium
(-US$4M)
Change in sales volume (35) Higher volumes at Worsley Alumina (+US$60M) and Brazil Aluminium (+US$35M)
More than offset by lower volumes at Hillside Aluminium (-US$30M) and Mozal
Aluminium (-US$34M), reflecting the timing of shipments, and Cannington
(-US$67M)
Controllable costs 44 Inventory and volume related movements (+US$28M) primarily due to higher
inventory at Mozal Aluminium as we manage customer commitments ahead of the
smelter transitioning to care and maintenance
Lower maintenance and contractor costs (+US$8M), primarily at Mozal Aluminium
Portfolio changes (71) Reflects divestment of IMC (-US$50M) in August 2024 and divestment of Cerro
Matoso (-US$21M) in December 2025
Other 114 Reflects the resumption of normalised production rates at Australia Manganese
(+US$100M) following the impacts of Tropical Cyclone Megan
H1 FY26 Underlying EBIT 747
Net finance income/(costs)
The Group's Underlying net finance costs decreased by US$11M to US$81M in H1
FY26. These costs primarily comprised the unwinding of the discount applied to
our closure and rehabilitation provisions (US$65M), interest on lease
liabilities (US$29M), largely for our multi-fuel co-generation facility at
Worsley Alumina, and interest on our US$700M of senior unsecured notes
(US$16M).
Underlying net finance income/(costs) reconciliation
US$M H1 FY26 H1 FY25
Unwind of discount applied to closure and rehabilitation provisions (65) (65)
Interest on lease liabilities (29) (29)
Interest on senior unsecured notes (16) (16)
Interest income on cash and cash equivalents 32 30
Other (3) (12)
Underlying net finance costs (81) (92)
Add back earnings adjustment for exchange rate variations on net cash/(debt) (25) 37
Joint venture adjustments 32 (#_ftn32) 111 115
Total adjustments to derive Underlying net finance costs 86 152
Remove net finance costs from discontinued operations 3 6
Net finance income/(costs) 8 66
Tax expense
The Group's Underlying income tax and royalty related taxation expense
increased by US$35M to US$232M in H1 FY26, for an Underlying effective tax
rate (ETR) of 34.2% (FY25: 35.0%). Our Group Underlying ETR reflects the
corporate tax rates 33 (#_ftn33) and royalty related taxes 34 (#_ftn34) of
the jurisdictions in which we operate and our geographical earnings mix.
The Underlying ETR for our manganese business was 62.5% in H1 FY26, including
the royalty related tax(34) at Australia Manganese and the derecognition of
certain deferred tax assets. The Underlying ETR for our Sierra Gorda EAI was
32.8% in H1 FY26, reflecting royalty related tax(34).
Underlying income tax expense (including royalty related taxation)
reconciliation
US$M H1 FY26 H1 FY25
Underlying EBIT 747 663
Include: Underlying net finance costs (81) (92)
Remove: Share of (profit)/loss of EAIs 13 13
Underlying profit/(loss) before tax 679 584
Income tax expense/(benefit) from continuing operations 108 198
Income tax expense/(benefit) from discontinued operations (3) 23
Tax effect of other adjustments to derive Underlying EBIT 7 -
Tax effect of other adjustments to derive Underlying net finance costs 7 (11)
Exchange rate variations on tax balances 16 (20)
Joint venture adjustments relating to income tax(32) 72 (1)
Joint venture adjustments relating to royalty related tax(32) 25 8
Total adjustments to derive Underlying income tax (expense)/benefit 127 (24)
Underlying income tax expense/(benefit) 232 197
Underlying effective tax rate 34.2% 33.7%
Cash flow
Group free cash flow from operations, excluding EAIs, was an outflow of
US$183M in H1 FY26 (H1 FY25: US$116M outflow), which reflected an increase in
growth capital expenditure at Hermosa (-US$90M) as well as a temporary build
in working capital.
Working capital increased by US$130M in H1 FY26, due to higher commodity
prices, the timing of sales from Mozal Aluminium to manage customer
commitments in H2 FY26, and movements in payables. A planned drawdown of
inventories at Mozal Aluminium is expected to add to the Group's cash
generation in H2 FY26.
Separately, we received distributions 35 (#_ftn35) of US$240M (H1 FY25:
US$23M) from our EAIs in H1 FY26. This included a record distribution of
US$180M from Sierra Gorda (H1 FY25: US$86M), reflecting strong operating
performance and higher metal prices, and US$60M from our manganese business
(H1 FY25: US$63M of funding) as we finalised external insurance recoveries
related to Australia Manganese.
Free cash flow from operations excluding EAIs
US$M H1 FY26 H1 FY25
Operating profit/(loss) from continuing and discontinued operations 563 520
Non-cash or non-operating items 191 280
Share of (profit)/loss from EAIs (115) (80)
(Gain)/loss from sale of operations (21) 47
Change in working capital (130) (267)
Cash generated from operations 488 500
Total capital expenditure, excluding EAIs (524) (478)
Operating cash flows generated from operations after capital expenditure (36) 22
Net interest paid 36 (#_ftn36) (18) (22)
Income tax paid (129) (116)
Free cash flow from operations (183) (116)
Working capital movement
US$M H1 FY26 Commentary
Trade and other receivables 16 Collection of receivables, partially offset by higher commodity prices in Q2
FY26
Inventories (30) Increase in finished good inventories in our aluminium value chain due to the
timing of sales at Mozal Aluminium
Trade and other payables (101) Timing of payments to suppliers
Provisions and other liabilities (15)
Total working capital movement (130)
Capital expenditure
The Group's capital expenditure 37 (#_ftn37) , excluding EAIs, increased by
US$46M to US$524M in H1 FY26, as higher growth capital expenditure at Hermosa
was partially offset by lower sustaining capital expenditure:
− Safe and reliable capital expenditure, including Cerro Matoso (US$6M),
decreased by US$77M to US$113M, reflecting a material reduction in sustaining
capital intensity following the divestment of IMC;
− Improvement and life extension capital expenditure, including Cerro Matoso
(US$2M), increased by US$28M to US$47M, as we progressed the development of
new mining areas at Worsley Alumina;
− Growth capital expenditure increased by US$90M to US$338M 38 (#_ftn38) at
Hermosa as we progressed critical path shaft sinking and construction of
surface infrastructure for the Taylor zinc-lead-silver project, and completed
the exploration decline for the Clark battery-grade manganese deposit; and
− Intangibles and capitalised exploration expenditure increased by US$5M to
US$26M as we continued multiple exploration programs targeting base metals in
highly prospective mineral belts.
Our share of capital expenditure for our material EAIs was unchanged at
US$185M in H1 FY26:
− Capital expenditure for our Sierra Gorda EAI increased by US$7M to US$120M, as
the operation continued its investment in deferred stripping; and
− Capital expenditure for our manganese EAIs decreased by US$7M to US$65M, as
Australia Manganese executed its recovery plan in FY25, while South Africa
Manganese completed work to access new mining areas at Wessels.
Capital expenditure (South32 share)(37)
US$M H1 FY26 H1 FY25
Safe and reliable capital expenditure (107) (120)
Improvement and life extension capital expenditure (45) (19)
Growth capital expenditure (338) (248)
Intangibles and the capitalisation of exploration expenditure (26) (21)
Discontinued operations((a)) (8) (70)
Total capital expenditure (excluding EAIs) (524) (478)
EAIs capital expenditure (185) (185)
Total capital expenditure (including EAIs) (709) (663)
(a) Reflects Cerro Matoso (H1 FY26: US$6M safe and reliable capital
expenditure and US$2M improvement and life extension capital expenditure; H1
FY25: US$13M safe and reliable capital expenditure) and IMC (H1 FY26: nil; H1
FY25: US$57M safe and reliable capital expenditure).
Balance sheet
The Group finished the period with net debt of US$25M, with strong operating
results and higher EAI distributions supporting our investment in growth at
Hermosa (-US$338M) and returns to shareholders (-US$152M).
We continue to prioritise a strong balance sheet and investment grade credit
rating through the cycle. Our current BBB+/Baa1 credit ratings were reaffirmed
by S&P Global Ratings and Moody's, respectively, during CY25. We also
retain access to significant liquidity, with our undrawn US$1.4B
sustainability-linked revolving credit facility maturing in December 2028.
Net cash/(debt)
US$M H1 FY26 FY25
Cash and cash equivalents 1,664 1,757
Lease liabilities (733) (713)
Other interest bearing liabilities (956) (921)
Net cash/(debt)((a)) (25) 123
(a) FY25 net cash includes Cerro Matoso which was classified as held
for sale.
Dividends and capital management
Our unchanged capital management framework supports investment in our business
and rewards shareholders as our financial performance improves. Consistent
with our policy to distribute a minimum 40% of Underlying earnings
attributable to members as ordinary dividends, the Board has resolved to pay a
fully-franked interim ordinary dividend of US 3.9 cents per share (US$175M) in
respect of H1 FY26, representing 40% of Underlying earnings attributable to
members.
Reflecting our strong financial position and positive outlook for the
business, we have also increased our capital management program by US$100M to
US$2.6B, with US$209M remaining to be returned to shareholders by 26 February
2027 39 (#_ftn39) .
Dividends announced
Period Dividend per share US$M Franking Pay-out ratio
(US cents)
H1 FY24 0.4 18 100% 45%
H2 FY24 3.1 140 100% 41%
H1 FY25 3.4 154 100% 41%
H2 FY25 2.6 117 100% 40%
H1 FY26 3.9 175 100% 40%
South32 shareholders registered on the South African branch register will not
be able to dematerialise or rematerialise their shareholdings between 4 and 6
March 2026 (both dates inclusive), nor will transfers to/from the South
African branch register be permitted between 26 February and 6 March 2026
(both dates inclusive).
Details of the currency exchange rates applicable for the dividend will be
announced to the relevant stock exchanges. Further dividend information is
available on our website (www.south32.net (http://www.south32.net) ).
South32 American Depositary Receipts (ADRs) each represent five fully paid
ordinary shares in South32 and ADR holders will receive dividends accordingly,
subject to the terms of the Depositary Agreement.
Dividend timetable Date
Announce currency conversion into South African rand 27 February 2026
Last day to trade cum dividend on the Johannesburg Stock Exchange (JSE) 3 March 2026
Ex-dividend date on the JSE 4 March 2026
Ex-dividend date on the ASX and London Stock Exchange (LSE) 5 March 2026
Record date (including currency election date for ASX) 6 March 2026
Payment date 2 April 2026
OUTLOOK
Production
FY26 production guidance remains unchanged across our operated assets, as we
continue to focus on delivering safe and reliable operations.
Production guidance for non-operated Brazil Aluminium has been revised to
135kt (from 160kt) in FY26 and 140kt (from 165kt) in FY27, as the smelter's
operator implements measures to improve stability and continue the ramp-up of
all three potlines.
Production guidance (South32 share)
H1 FY26 FY26e((a)) FY27e((a)) Key FY26e guidance commentary
Worsley Alumina Guidance unchanged
Alumina production (kt) 1,893 3,750 3,900 Planned calciner maintenance completed in Q1 FY26
Brazil Alumina (non-operated) Guidance unchanged
Alumina production (kt) 709 1,360 1,360 Expected to continue to test nameplate capacity
Brazil Aluminium (non-operated) FY26 guidance revised to 135kt (from 160kt)
Aluminium production (kt) 74 ↓135 ↓140 Operator's revised ramp-up profile
Hillside Aluminium 40 (#_ftn40) Guidance unchanged
Aluminium production (kt) 362 720 720 Expected to continue to test maximum technical capacity
Mozal Aluminium(40) Guidance unchanged
Aluminium production (kt) 183 240 N/A Transitioning to care and maintenance in March 2026
Sierra Gorda (non-operated) Guidance unchanged
Ore processed (Mt) 10.9 21.8 21.8 Potential upside to guidance from by-product volumes
Payable copper equivalent production (kt) 41 (#_ftn41) 47.0 85.7 90.2
Payable copper production (kt) 36.3 72.0 79.0
Payable molybdenum production (kt) 1.2 1.2 0.5
Payable gold production (koz) 10.9 18.0 20.0
Payable silver production (koz) 348 600 700
Cannington Guidance unchanged
Ore processed (kdmt) 1,009 1,850 1,750 Delivered improved underground mining rates in H1 FY26
Payable zinc equivalent production (kt) 42 (#_ftn42) 102.8 200.6 204.7
Payable silver production (koz) 4,487 8,200 8,700
Payable lead production (kt) 42.3 87.0 80.0
Payable zinc production (kt) 18.7 40.0 43.0
Australia Manganese Guidance unchanged
Manganese ore production (kwmt) 1,660 3,200 3,200 Returned to normalised production rates
South Africa Manganese Guidance unchanged
Manganese ore production (kwmt) 1,057 2,000 2,000 Further maintenance scheduled in Q3 FY26
(a) The denotation (e) refers to an estimate or forecast year.
Costs and capital expenditure
Operating unit cost performance and guidance
Stable production and disciplined cost management saw Operating unit costs
track in line with or below expectations in H1 FY26. As a result, FY26
Operating unit cost guidance has been maintained across all operated assets.
While Operating unit cost guidance is not provided for our aluminium smelters,
their cost profile will continue to be influenced by producer currencies, and
the prices of raw material inputs and energy.
Operating unit cost 43 (#_ftn43)
H1 FY25 H1 FY26 Prior FY26e((a), 44 (#_ftn44) ) New H1 FY26 to H1 FY25 commentary
FY26e((a), 45 (#_ftn45) ) FY26 new guidance to FY26 prior guidance commentary
Worsley Alumina
(US$/t) 306 318 310 310 H1 FY26: higher volumes and lower caustic soda consumption, offset by
inflation and restructuring costs
FY26e guidance unchanged, with lower costs expected in H2 FY26 due to lower
labour costs and deferral of non-essential activity
Brazil Alumina (non-operated)
(US$/t) 320 320 Not provided Not provided H1 FY26: higher volumes offset by a stronger Brazilian real
FY26e: will continue to be influenced by energy and raw material input prices
Brazil Aluminium (non-operated)
(US$/t) 3,377 2,919 Not provided Not provided H1 FY26: higher volumes and lower alumina input prices, more than offset a
stronger Brazilian real
FY26e: will continue to be influenced by the price of raw material inputs and
lower expected volumes in H2 FY26
Hillside Aluminium
(US$/t) 2,351 2,295 Not provided Not provided H1 FY26: lower alumina input prices, more than offset a stronger South African
rand and higher energy prices
FY26e: will continue to be influenced by the price of raw material inputs, the
South African rand and inflation-linked energy costs
Mozal Aluminium
(US$/t) 2,425 2,556 Not provided Not provided H1 FY26: lower pot relining and maintenance spend, offset by higher alumina
input prices and a stronger South African rand
FY26e: will continue to be influenced by the price of raw material inputs and
the South African rand
Sierra Gorda (non-operated)
(US$/t)((b)) 17.1 17.0 17.0 17.0 H1 FY26: lower ore mined as we increased development activity, partially
offset by a drawdown in stockpiles
FY26e guidance unchanged
Cannington
(US$/t)((b)) 197 183 205 205 H1 FY26: higher ore processed and inventory movements, partially offset by
higher price-linked royalties
FY26e guidance unchanged, with potentially higher
price-linked royalties if metal prices remain at current levels
Australia Manganese
(US$/dmtu, FOB) - 2.31 2.40 2.40 H1 FY26: costs in line as the operation delivered planned volumes
FY26e guidance unchanged
South Africa Manganese
(US$/dmtu, FOB) 3.13 3.09 3.10 3.10 H1 FY26: drawdown of low-cost inventory more than offset a stronger South
African rand
FY26e guidance unchanged
(a) The denotation (e) refers to an estimate or forecast year.
(b) US dollar per tonne of ore processed. Periodic movements in
finished product inventory may impact Operating unit costs.
Capital expenditure guidance (excluding exploration and intangibles)
FY26 Group capital expenditure guidance, including EAIs, remains unchanged at
US$1,400M, with:
− Safe and reliable: revised to US$225M (from US$240M), due to the timing of
spend at Brazil Alumina;
− Improvement and life extension: remains unchanged at US$100M as we continue to
develop new mining areas at Worsley Alumina; and
− Growth: Hermosa capital expenditure remains unchanged at US$750M 46 (#_ftn46)
, as we progress construction of our large-scale, long-life Taylor
zinc-lead-silver project.
FY26 capital expenditure for our material EAIs has been revised to US$325M
(from US$310M), with:
− Sierra Gorda: revised to US$214M (from US$195M), due to higher deferred
stripping activity; and
− Manganese: revised to US$111M (from US$115M), as we invest in water management
infrastructure and mobile equipment at Australia Manganese, and planned
capital works at South Africa Manganese.
Capital expenditure excluding exploration and intangibles (South32 share)
US$M H1 FY26 FY26e((a))
Worsley Alumina 32 55
Brazil Alumina 5 40
Brazil Aluminium 9 15
Hillside Aluminium 34 65
Mozal Aluminium 47 (#_ftn47) 4 4
Cannington 23 40
Cerro Matoso 48 (#_ftn48) 6 6
Safe and reliable capital expenditure (excluding EAIs) 113 225
Worsley Alumina 41 90
Cerro Matoso(48) 2 2
Other operations 4 8
Improvement and life extension capital expenditure (excluding EAIs) 47 100
Hermosa 338 750
Growth capital expenditure 338 750
Total capital expenditure (excluding EAIs) 498 1,075
Total capital expenditure (including EAIs) 678 1,400
Capital expenditure for EAIs excluding exploration and intangibles (South32
share)
US$M H1 FY26 FY26e((a))
Sierra Gorda 111 200
Australia Manganese 45 80
South Africa Manganese 13 25
Safe and reliable capital expenditure (EAIs) 169 305
Sierra Gorda 5 14
Australia Manganese 1 1
South Africa Manganese 5 5
Improvement and life extension capital expenditure (EAIs) 11 20
Total capital expenditure (EAIs) 180 325
(a) The denotation (e) refers to an estimate or forecast year.
Capitalised exploration guidance
FY26 Group capitalised exploration guidance, including EAIs, is unchanged at
US$40M as we progress base metals exploration programs across our portfolio.
Capitalised exploration (South32 share)
US$M H1 FY26 FY26e((a))
Capitalised exploration (excluding EAIs) 16 30
EAIs capitalised exploration 4 10
Capitalised exploration (including EAIs) 20 40
(a) The denotation (e) refers to an estimate or forecast year.
Other expenditure guidance
Other expenditure items presented below are on a proportional consolidation
basis including our manganese and Sierra Gorda EAIs.
H1 FY26 FY26e((a)) Commentary
Group and unallocated expense in Underlying EBIT (excluding greenfield
exploration and third party products and services EBIT)
(US$M) 33 120 Guidance unchanged
H1 FY26 reflected favourable inter-group inventory adjustments in our
aluminium value chain
Hermosa expenses included in Underlying EBIT
(US$M) 28 40 Guidance unchanged
Underlying depreciation and amortisation
(US$M) 360 ↓720 Guidance revised to US$720M (from US$780M)
Reflects updated mine life assumptions
Underlying net finance costs
(US$M) 81 190 Guidance unchanged
Greenfield exploration
(US$M) 15 30 Guidance unchanged
(a) The denotation (e) refers to an estimate or forecast year.
OPERATIONS ANALYSIS
A summary of the underlying performance of the Group's operations is presented
below and a more detailed analysis is presented on pages 23 to 31.
Operations table (South32 share)
Underlying revenue Underlying EBIT
US$M H1 FY26 H1 FY25 H1 FY26 H1 FY25
Worsley Alumina 746 916 70 280
Brazil Alumina 267 408 (3) 146
Brazil Aluminium 204 153 (15) (55)
Hillside Aluminium 1,021 986 171 89
Mozal Aluminium 473 488 58 33
Sierra Gorda 578 405 298 128
Cannington 396 323 163 89
Hermosa - - (28) (17)
Australia Manganese 306 - 66 (34)
South Africa Manganese 167 191 (2) 18
Third party products and services 49 (#_ftn49) 136 190 6 10
Inter-segment / Group and unallocated (479) (593) (48) (106)
South32 Group (excluding IMC and Cerro Matoso) 3,815 3,467 736 581
IMC 50 (#_ftn50) - 144 - 50
Cerro Matoso 193 239 11 32
South32 Group 4,008 3,850 747 663
WORSLEY ALUMINA
Location: Western Australia, Australia
South32 share: 86 per cent
Worsley Alumina is an integrated bauxite mining and alumina refining operation
in the South West of Western Australia. Alumina from Worsley Alumina is
currently exported to our Hillside Aluminium and Mozal Aluminium smelters and
other smelters around the world.
Volumes
Worsley Alumina saleable production increased by 2% (or 43kt) to 1,893kt in
H1 FY26, as the operation delivered planned volumes while completing scheduled
calciner maintenance. FY26 production guidance remains unchanged at 3,750kt.
Worsley Alumina commenced development of the Worsley Mine Development Project
(the Project) in Q4 FY25, following receipt of final environmental
approvals 51 (#_ftn51) . The Project is expected to deliver improved bauxite
supply and sustain production to at least FY36 52 (#_ftn52) .
Operating costs
Operating unit costs increased by 4%, to US$318/t in H1 FY26, as higher
volumes and lower caustic soda consumption (H1 FY26: 120kg/t, H1 FY25:
134kg/t), reflecting improved bauxite quality, were more than offset by
general inflation and one-off costs associated with workforce restructuring
initiatives.
Our operating margin decreased to 21% (H1 FY25: 40%), as alumina prices
declined from elevated levels in the prior period.
FY26 Operating unit cost guidance is unchanged at US$310/t, with costs
expected to be lower in H2 FY26 (compared to H1 FY26) due to lower labour
costs and deferral of non-essential activities in response to market
conditions. Exchange rate and price assumptions for FY26 Operating unit cost
guidance are detailed on page 18, footnote 45.
Financial performance
Underlying EBIT decreased by 75% (or US$210M) to US$70M in H1 FY26, as higher
sales volumes (+US$38M) and lower caustic soda consumption (+US$12M), were
more than offset by a 22% decrease in our average realised price of alumina
(-US$208M).
Capital expenditure
Safe and reliable capital expenditure was US$32M in H1 FY26 and is expected to
be US$55M in FY26 as we continue our investment in additional bauxite residue
disposal capacity.
Improvement and life extension capital expenditure was US$41M in H1 FY26 and
is expected to be US$90M in FY26 as we advance development of new mining areas
as part of the Project, including the Nullaga mine development.
South32 share H1 FY26 H1 FY25
Alumina production (kt) 1,893 1,850
Alumina sales (kt) 1,863 1,789
Realised alumina sales price (US$/t) 400 512
Operating unit cost (US$/t) 318 306
South32 share (US$M) H1 FY26 H1 FY25
Underlying revenue 746 916
Underlying EBITDA 153 369
Underlying EBIT 70 280
Net operating assets((a)) 1,722 1,707
Capital expenditure 73 50
Safe and reliable 32 38
Improvement and life extension 41 12
(a) H1 FY25 reflects the balance as at 30 June 2025.
BRAZIL ALUMINA
Location: Pará and Maranhão, Brazil
South32 investment: Bauxite - 33 per cent
South32 share: Alumina - 36 per cent (non-operated)
Brazil Alumina includes a 33% interest in the Mineração Rio do Norte (MRN)
bauxite mine and a 36% interest in the Alumar alumina refinery. Our share of
bauxite produced from MRN is supplied to the Alumar alumina refinery. The
alumina produced from the Alumar alumina refinery is supplied to the
co-located Alumar aluminium smelter and exported to other smelters around the
world.
Volumes
Brazil Alumina saleable production increased by 4% (or 27kt) to a record
709kt in H1 FY26, as the refinery operated above nameplate capacity. FY26
production guidance remains unchanged at 1,360kt.
Operating costs
Operating unit costs were unchanged at US$320/t in H1 FY26 as higher volumes
were offset by a stronger Brazilian real.
Our operating margin decreased to 9% (H1 FY25: 43%) as alumina prices declined
from elevated levels in the prior period.
While Operating unit cost guidance is not provided for this non-operated
facility, the refinery will continue to be influenced by energy and raw
material input prices.
Financial performance
Underlying EBIT decreased to a loss of US$3M in H1 FY26, as higher sales
volumes (+US$17M) were more than offset by a 37% reduction in our average
realised price of alumina (-US$158M).
Our share of the loss from our equity accounted interest in MRN was unchanged
at US$13M in H1 FY26.
Capital expenditure
Capital expenditure decreased by US$22M to US$5M in H1 FY26 due to the timing
of spend and refinery improvement projects completed in the prior period.
Capital expenditure is expected to be US$40M (previously US$50M) in FY26.
MRN continues to execute the transmission line project to connect the MRN
bauxite mine to the Brazilian power grid. The transmission line will enable
MRN to reduce operating costs by replacing its diesel-powered generation with
cost efficient renewable energy sources. Our share of capital expenditure for
the transmission line was ~US$15M (33% share) in H1 FY26.
South32 share H1 FY26 H1 FY25
Alumina production (kt) 709 682
Alumina sales (kt) 719 691
Realised sales price (US$/t) 371 590
Operating unit cost (US$/t)((a)) 320 320
South32 share (US$M)((b)) H1 FY26 H1 FY25
Underlying revenue 267 408
Underlying EBITDA 25 174
Underlying EBIT (3) 146
Net operating assets((c)) 671 638
Capital expenditure 5 27
Safe and reliable 5 22
Improvement and life extension - 5
(a) Excludes the profit/(loss) from our equity accounted interest in
MRN.
(b) Results for Brazil Alumina include MRN on an equity accounted
basis.
(c) H1 FY25 reflects the balance as at 30 June 2025.
BRAZIL ALUMINIUM
Location: Maranhão, Brazil
South32 share: 40 per cent (non-operated)
Brazil Aluminium produces aluminium for domestic and export markets, with
alumina supplied by the co-located Alumar alumina refinery. Our share of
Brazil Aluminium production is powered by 100% renewable power.
Volumes
Brazil Aluminium saleable production increased by 16% (or 10kt) to 74kt in H1
FY26. Despite this growth, production in Q2 FY26 was below plan due to
unplanned pot outages and external energy disruptions.
Production guidance has been revised to 135kt (from 160kt) in FY26 and 140kt
(from 165kt) in FY27, as the smelter's operator implements measures to improve
stability and continue the ramp-up of all three potlines.
Operating costs
Operating unit costs decreased by 14%, to US$2,919/t in H1 FY26,
as higher volumes and lower alumina input prices, more than offset a stronger
Brazilian real.
While Operating unit cost guidance is not provided, the smelter's cost profile
will continue to be influenced by raw material input prices and the ramp-up
profile for all three potlines.
Financial performance
Underlying EBIT improved by US$40M, to a loss of US$15M in H1 FY26, as higher
sales volumes (+US$35M) and average realised aluminium prices (+US$16M) more
than offset higher smelter raw materials consumption (-US$15M) to deliver
increased volumes.
Capital expenditure
Capital expenditure was US$9M in H1 FY26 and is expected to be US$15M in FY26.
South32 share H1 FY26 H1 FY25
Aluminium production (kt) 74 64
Aluminium sales (kt) 74 61
Realised sales price (US$/t) 2,757 2,508
Operating unit cost (US$/t) 2,919 3,377
South32 share (US$M) H1 FY26 H1 FY25
Underlying revenue 204 153
Underlying EBITDA (12) (53)
Underlying EBIT (15) (55)
Net operating assets((a)) 139 71
Capital expenditure 9 6
Safe and reliable 9 6
Improvement and life extension - -
(a) H1 FY25 reflects the balance as at 30 June 2025.
HILLSIDE ALUMINIUM
Location: KwaZulu-Natal, South Africa
South32 share: 100 per cent
Hillside Aluminium is located in Richards Bay, South Africa, and is the
largest aluminium smelter in the southern hemisphere. The smelter produces
high-quality, primary aluminium for domestic and export markets.
Volumes
Hillside Aluminium saleable production was unchanged at 362kt in H1 FY26, as
the smelter continued to test its maximum technical capacity, despite the
impact of load-shedding. FY26 production guidance remains unchanged at
720kt 53 (#_ftn53) .
Operating costs
Operating unit costs decreased by 2%, to US$2,295/t in H1 FY26,
as the smelter continued to test its maximum technical capacity and benefitted
from lower alumina input prices. These benefits more than offset a stronger
South African rand and inflation-linked indexation of energy costs.
Our operating margin increased to 20% (H1 FY25: 12%), reflecting a 7% increase
in the average realised price of aluminium together with lower costs.
While Operating unit cost guidance is not provided, the cost profile of the
smelter will continue to be heavily influenced by the price of smelter raw
material inputs and other external factors including the South African rand
and inflation-linked indexation of energy costs.
The smelter's electricity is supplied by Eskom under a contract to 2031, with
a tariff that is South African rand based and a rate of escalation linked to
the South African Producer Price Index. We are continuing to work with Eskom
and other stakeholders in the South African energy sector on pathways to
secure low-carbon 54 (#_ftn54) electricity supply beyond 2031.
Financial performance
Underlying EBIT increased by 92% (or US$82M), to US$171M in H1 FY26, as higher
average realised aluminium prices (+US$65M) combined with lower smelter raw
material input prices (+US$34M), including alumina, more than offset a
stronger South African rand (-US$11M), and lower sales volumes (-US$30M) due
to the timing of shipments.
49 pots were relined at a cost of US$323k per pot in H1 FY26
(H1 FY25: 95 pots at US$305k per pot), with ~70 pots scheduled to be relined
in FY26. The smelter is deploying AP3XLE energy efficiency technology in its
pot relining activity to further enhance the smelter's energy efficiency and
reduce GHG emissions. At the end of H1 FY26, ~63% of the pots had been relined
using AP3XLE technology.
Capital expenditure
Capital expenditure was US$34M in H1 FY26 and is expected to be US$65M in FY26
as we continue our investment to replace the pot tending assemblies.
South32 share H1 FY26 H1 FY25
Aluminium production (kt) 362 362
Aluminium sales (kt) 356 367
Realised sales price (US$/t) 2,868 2,687
Operating unit cost (US$/t) 2,295 2,351
South32 share (US$M) H1 FY26 H1 FY25
Underlying revenue 1,021 986
Underlying EBITDA 204 123
Underlying EBIT 171 89
Net operating assets((a)) 737 788
Capital expenditure 34 19
Safe and reliable 34 19
Improvement and life extension - -
(a) H1 FY25 reflects the balance as at 30 June 2025.
MOZAL ALUMINIUM
Location: Maputo, Mozambique
South32 share: 63.7 per cent
Mozal Aluminium is located near Maputo, Mozambique, and is a significant
industrial employer in the country. The smelter produces high-quality, primary
aluminium for domestic and export markets.
Volumes
Mozal Aluminium saleable production increased by 3% (or 5kt) to 183kt in H1
FY26.
On 16 December 2025 55 (#_ftn55) , we announced that Mozal Aluminium will
transition to care and maintenance on or around 15 March 2026 due to the
inability to secure sufficient and affordable electricity supply. With the
smelter transitioning to care and maintenance, we have ceased pot relining and
procurement of smelter raw materials. FY26 production guidance remains
unchanged at 240kt 56 (#_ftn56) , based on operations continuing to March
2026.
Operating costs
Operating unit costs increased by 5%, to US$2,556/t in H1 FY26,
as higher priced alumina and a stronger South African rand more than offset
lower pot relining and maintenance spend, as we prepare to transition the
smelter to care and maintenance.
Our operating margin decreased to 12% (H1 FY25: 14%), as a 4% increase in the
average realised price of aluminium was more than offset by higher costs.
While Operating unit cost guidance is not provided, the cost profile of the
smelter will continue to be heavily influenced by the price of smelter raw
material inputs and external factors including the South African rand.
Financial performance
Underlying EBIT increased by 76% (or US$25M), to US$58M in H1 FY26, as higher
average realised aluminium prices (+US$19M) and lower maintenance spend
(+US$27M) more than offset lower sales volumes (-US$34M) due to the timing of
sales. We expect to draw down finished goods inventory during H2 FY26.
Capital expenditure
Capital expenditure was US$4M in H1 FY26 and is expected to be US$4M
(previously US$10M) for the period ending March 2026.
South32 share H1 FY26 H1 FY25
Aluminium production (kt) 183 178
Aluminium sales (kt) 162 174
Realised sales price (US$/t) 2,920 2,805
Operating unit cost (US$/t) 2,556 2,425
South32 share (US$M) H1 FY26 H1 FY25
Underlying revenue 473 488
Underlying EBITDA 59 66
Underlying EBIT 58 33
Net operating assets((a)) 49 152
Capital expenditure 4 12
Safe and reliable 4 12
Improvement and life extension - -
(a) H1 FY25 reflects the balance as at 30 June 2025.
SIERRA GORDA
Location: Antofagasta, Chile
South32 share: 45 per cent (non-operated)
Sierra Gorda is a large-scale, open pit mine in the prolific Antofagasta
copper mining region, that produces copper, molybdenum, gold and silver.
Volumes
Sierra Gorda payable copper equivalent production 57 (#_ftn57) was largely
unchanged at 47.0kt in H1 FY26, with plant throughput and copper production in
line with plan, while higher molybdenum output from the current mining phase
offset lower planned gold production.
FY26 production guidance(57) remains unchanged at 85.7kt (ore processed
21.8Mt, copper 72.0kt, molybdenum 1.2kt, gold 18.0koz and silver 600koz), with
the operation positioned to potentially exceed guidance if strong volumes of
molybdenum, gold and silver continue in H2 FY26.
Operating costs
Operating unit costs decreased by 1%, to US$17.0/t ore processed in H1 FY26,
reflecting lower ore mined as the operation increased development activity,
partially offset by a drawdown in stockpiles.
Our operating margin increased to a record 68% (H1 FY25: 53%), reflecting
higher average metal prices and lower costs.
FY26 Operating unit cost guidance is unchanged at US$17.0/t ore processed.
Exchange rate and price assumptions for FY26 Operating unit cost guidance are
detailed on page 18, footnote 45.
Financial performance
Underlying EBIT increased by 133% (or US$170M), to US$298M in H1 FY26, as
higher average realised metal prices (+US$168M) and sales volumes (+US$5M)
more than offset higher contractor costs (-US$9M).
Capital expenditure
Safe and reliable capital expenditure was US$111M in H1 FY26 and is expected
to be US$200M (previously US$180M) in FY26, as the operation continues
deferred stripping activity.
Improvement and life extension capital expenditure was US$5M in H1 FY26 and is
expected to be US$14M in FY26, as the operation progresses the feasibility
study for the fourth grinding line project. Following completion of the
feasibility study, the joint venture partners will undertake an independent
review to support a potential joint final investment decision in mid‑CY26.
South32 share H1 FY26 H1 FY25
Ore mined (Mt) 11.6 12.6
Ore processed (Mt) 10.9 11.1
Ore grade processed (%, Cu) 0.42 0.42
Payable copper equivalent 47.0 47.2
production (kt)(57)
Payable copper production (kt) 36.3 36.7
Payable molybdenum production (kt) 1.2 0.9
Payable gold production (koz) 10.9 15.9
Payable silver production (koz) 348 301
Payable copper sales (kt) 36.5 37.9
Payable molybdenum sales (kt) 1.3 0.7
Payable gold sales (koz) 11.2 16.2
Payable silver sales (koz) 344 317
Realised copper sales price (US$/lb) 5.55 3.83
Realised molybdenum sales price 23.31 21.68
(US$/lb)
Realised gold sales price (US$/oz) 4,107 2,593
Realised silver sales price (US$/oz) 55.2 31.5
Operating unit cost 17.0 17.1
(US$/t ore processed) 58 (#_ftn58)
South32 share (US$M) H1 FY26 H1 FY25
Underlying revenue 578 405
Underlying EBITDA 393 215
Underlying EBIT 298 128
Net operating assets((a)) 1,890 1,769
Capital expenditure 116 106
Safe and reliable 111 90
Improvement and life extension 5 16
Exploration expenditure 7 7
Exploration expensed 3 -
(a) H1 FY25 reflects the balance as at 30 June 2025.
CANNINGTON
Location: Queensland, Australia
South32 share: 100 per cent
Cannington is an underground mine located in north-west Queensland, Australia,
that produces high-grade lead and zinc concentrates with a high silver
content.
Volumes
Cannington payable zinc equivalent production 59 (#_ftn59) decreased by 18%
(or 23.0kt) to 102.8kt in H1 FY26, as higher ore processed was more than
offset by lower planned metal grades.
FY26 production guidance(59) remains unchanged at 200.6kt (ore processed
1,850kdmt, zinc 40.0kt, lead 87.0kt and silver 8,200koz).
Operating costs
Operating unit costs decreased by 7%, to US$183/t ore processed in H1 FY26,
as higher ore processed and inventory movements more than offset higher
price-linked royalties.
Our operating margin increased to 53% (H1 FY25: 40%), reflecting stronger
metal prices together with lower costs.
While costs are tracking below plan, FY26 Operating unit cost guidance remains
unchanged at US$205/t ore processed, with the potential for higher
price-linked royalties if metal prices remain at current levels. Exchange rate
and price assumptions for FY26 Operating unit cost guidance are detailed on
page 18, footnote 45.
Financial performance
Underlying EBIT increased by 83% (or US$74M), to US$163M in H1 FY26, as higher
average realised metal prices (+US$140M) more than offset lower planned sales
volumes (-US$67M).
Capital expenditure
Capital expenditure was unchanged at US$23M in H1 FY26 and is expected to be
US$40M in FY26 as we invest in underground development and activities to
support mine life extensions.
Our work on mine life extension options has supported a further increase in
the underground Ore Reserve by 3Mt to 13Mt in H1 FY26, extending the reserve
life by approximately two years to FY33 60 (#_ftn60) . To support the
extended mine life, we expect to invest additional capital expenditure of
approximately US$65M to US$80M during FY27 and FY28, including for ventilation
and electrical upgrades.
South32 share H1 FY26 H1 FY25
Ore mined (kwmt) 1,088 999
Ore processed (kdmt) 1,009 982
Ore grade processed (g/t, Ag) 159 206
Ore grade processed (%, Pb) 5.1 5.9
Ore grade processed (%, Zn) 2.6 3.2
Payable zinc equivalent production (kt)(59) 102.8 125.8
Payable silver production (koz) 4,487 5,615
Payable lead production (kt) 42.3 49.6
Payable zinc production (kt) 18.7 22.9
Payable silver sales (koz) 4,570 5,469
Payable lead sales (kt) 42.7 54.3
Payable zinc sales (kt) 16.9 23.0
Realised silver sales price (US$/oz) 58.4 29.4
Realised lead sales price (US$/t) 1,897 1,823
Realised zinc sales price (US$/t) 2,840 2,739
Operating unit cost 183 197
(US$/t ore processed) 61 (#_ftn61)
South32 share (US$M) H1 FY26 H1 FY25
Underlying revenue 396 323
Underlying EBITDA 211 130
Underlying EBIT 163 89
Net operating assets((a)) 135 131
Capital expenditure 23 23
Safe and reliable 23 23
Improvement and life extension - -
Exploration expenditure 3 3
Exploration expensed 1 1
(a) H1 FY25 reflects the balance as at 30 June 2025.
AUSTRALIA MANGANESE
Location: Northern Territory, Australia
South32 share: 60 per cent
Australia Manganese is Groote Eylandt Mining Company (GEMCO) in the Northern
Territory, Australia, an open-cut mining operation that produces high-grade
manganese ore.
Volumes
Australia Manganese saleable production increased to 1,660kwmt in H1 FY26, as
the operation achieved normalised production rates after executing its
recovery plan following the impacts of Tropical Cyclone Megan.
FY26 production guidance remains unchanged at 3,200kwmt, subject to potential
wet season impacts.
Australia Manganese finalised insurance claims related to Tropical Cyclone
Megan, with an additional US$153M (100% basis) in external insurance
recoveries received in H1 FY26, bringing final approved recoveries to US$503M
(100% basis).
Operating costs
Operating unit costs were US$2.31/dmtu in H1 FY26 and FY26 Operating unit cost
guidance remains unchanged at US$2.40/dmtu. Exchange rate and price
assumptions for FY26 Operating unit cost guidance are detailed on page 18,
footnote 45.
Financial performance
Underlying EBIT increased to US$66M in H1 FY26 (H1 FY25: loss of US$34M), with
sales volumes increasing to 1,809kwmt following the commissioning of new wharf
infrastructure in Q4 FY25.
Depreciation and amortisation increased by US$38M to US$41M in H1 FY26 as
operations resumed.
Income related to external insurance recoveries (US$92M) is excluded from
Underlying EBIT as an earnings adjustment.
Capital expenditure
Capital expenditure was US$46M in H1 FY26 and is expected to be US$81M in FY26
as we continue planned investments in water management infrastructure and
mobile equipment.
South32 share H1 FY26 H1 FY25
Manganese ore production (kwmt) 1,660 639
Manganese ore sales (kwmt) 1,809 -
Realised external manganese ore sales price (US$/dmtu, FOB) 62 (#_ftn62) 63 3.81 -
(#_ftn63)
Operating unit cost (US$/dmtu, FOB)(63, 64 (#_ftn64) ) 2.31 -
South32 share (US$M) H1 FY26 H1 FY25
Underlying revenue 306 -
Underlying EBITDA 107 (31)
Underlying EBIT 66 (34)
Net operating assets((a)) 264 240
Capital expenditure 46 47
Safe and reliable 45 47
Improvement and life extension 1 -
Exploration expenditure 3 3
Exploration expensed 3 3
(a) H1 FY25 reflects the balance as at 30 June 2025.
SOUTH AFRICA MANGANESE
Location: Northern Cape and Gauteng, South Africa
South32 share: Ore - 54.6 per cent, Alloy - 60 per cent (divested)
South Africa Manganese consists of two manganese mines in the Kalahari Basin,
the open-cut Mamatwan mine and the underground Wessels mine.
In June 2025, Samancor Manganese Proprietary Limited completed the divestment
of the Metalloys manganese alloy smelter 65 (#_ftn65) , which had been placed
on care and maintenance in FY20.
Volumes
South Africa Manganese saleable production decreased by 2% (or 25kt) to
1,057kwmt in H1 FY26, as the operation completed planned maintenance and
underground development at Wessels.
FY26 production guidance remains unchanged at 2,000kwmt, with further planned
maintenance scheduled in Q3 FY26.
Operating costs
Operating unit costs decreased by 1%, to US$3.09/dmtu in H1 FY26, as a
drawdown of low-cost inventory more than offset a stronger South African rand.
FY26 Operating unit cost guidance is unchanged at US$3.10/dmtu. Exchange rate
and price assumptions for FY26 Operating unit cost guidance are detailed on
page 18, footnote 45.
Financial performance
Ore Underlying EBIT decreased by US$21M, to a loss of US$2M in H1 FY26,
reflecting lower average realised manganese prices (-U$19M) and a stronger
South African rand (-US$4M).
Capital expenditure
Capital expenditure was US$18M in H1 FY26 and is expected to be US$30M
(previously US$35M) in FY26.
South32 share H1 FY26 H1 FY25
Manganese ore production (kwmt) 1,057 1,082
Manganese ore sales (kwmt) 1,094 1,088
Realised external manganese ore sales price (US$/dmtu, FOB) 66 (#_ftn66) 67 3.36 3.85
(#_ftn67)
Ore operating unit cost (US$/dmtu, FOB)(67, 68 (#_ftn68) ) 3.09 3.13
South32 share (US$M) H1 FY26 H1 FY25
Underlying revenue 167 191
Manganese ore 167 191
Manganese alloy - -
Underlying EBITDA 8 28
Manganese ore 8 29
Manganese alloy - (1)
Underlying EBIT (2) 18
Manganese ore (2) 19
Manganese alloy - (1)
Net operating assets/(liabilities)((a)) 266 252
Manganese ore 266 252
Manganese alloy - -
Capital expenditure 18 25
Safe and reliable 13 16
Improvement and life extension 5 9
(a) H1 FY25 reflects the balance as at 30 June 2025.
GLOSSARY OF TERMS AND ABBREVIATIONS
ADR
American Depositary Receipts.
ASX
Australian Securities Exchange.
Cu/TCu
Copper/total copper.
CY
Calendar year.
dmtu
Dry metric tonne unit.
EAI
Equity accounted investment.
FY
Financial Year.
Goal
Goal is defined as an aspiration to deliver an outcome for which we have not
identified a pathway for delivery, but for which efforts will be pursued
towards achieving that outcome, subject to certain assumptions or conditions.
g/t
Grams per tonne.
JSE
Johannesburg Stock Exchange.
kdmt
Thousand dry metric tonnes.
koz
Thousand ounces.
kt
Thousand tonnes.
ktpa
Thousand tonnes per annum.
kwmt
Thousand wet metric tonnes.
lb
Pound.
Leadership roles
A Leadership Role is a position in the organisational structure flagged as the
head of an organisational unit.
Local workforce diversity
Local workforce diversity is a metric consisting of four equally weighted
targets measuring local workforce diversity across the regions in which we
operate. This includes Black People in the total workforce in South Africa,
Black People in Management Roles in South Africa, Mozambique nationals in the
Mozambique workforce and Aboriginal and Torres Strait Islander (ATSI) Peoples
representation in the Australian workforce. In FY25, the Local workforce
diversity metric also included a target for local community members hired into
unionised positions at Cerro Matoso. This target was removed following the
divestment of Cerro Matoso on 1 December 2025.
Lost time injury frequency (LTIF)
(The sum of lost time injuries x 1,000,000) ÷ exposure hours, for employees
and contractors. This is stated in units of per million hours worked for
employees and contractors. We adopt the United States Government Occupational
Safety and Health Administration (OSHA) guidelines for the recording and
reporting of occupational injuries and illnesses.
LSE
London Stock Exchange.
Moz
Million ounce.
Mt
Million tonne.
Mtpa
Million tonnes per annum.
MW
Megawatt.
Mwmt
Million wet metric tonne.
Operating cost
Operating cost is Underlying revenue less Underlying EBITDA excluding third
party products and services.
Operating unit cost
Operating unit cost is Underlying revenue less Underlying EBITDA, excluding
third party products and services, divided by sales volumes.
oz
Ounce.
Realised sales price
Realised sales price is calculated as Underlying revenue excluding third party
products and services divided by sales volume.
ROIC
Return on invested capital (ROIC) is calculated as Underlying EBIT less the
discount on rehabilitation provisions included in Underlying net finance
costs, tax effected by the Group's Underlying effective tax rate (ETR)
including our material equity accounted investments on a proportional
consolidation basis, divided by the sum of fixed assets (excluding any
rehabilitation assets, the impact of any impairments or impairment reversals,
and unproductive capital) and inventories. For the half year report, financial
results are annualised to reflect 12-month equivalent returns.
Significant hazard frequency
(The sum of significant hazards x 1,000,000) ÷ exposure hours. This is stated
in units of per million hours worked for employees and contractors. A
significant hazard is something that has the potential to cause harm, ill
health or injury, or damage to property, plant or the environment.
South32 share
South32's ownership share of operations is presented as follows: Worsley
Alumina (86% share), Brazil Alumina (36% share), Brazil Aluminium (40% share),
Hillside Aluminium (100%), Mozal Aluminium (63.7% share), Sierra Gorda (45%
share), Cannington (100%), Hermosa (100%), Australia Manganese (60% share) and
South Africa Manganese ore (54.6% share). Prior to the divestment of Illawarra
Metallurgical Coal on 29 August 2024, South32's ownership was 100%. Prior to
the divestment of South Africa Manganese alloy on 3 June 2025, South32's
ownership was 60%. Prior to divestment of Cerro Matoso on 1 December 2025,
South32's ownership was 99.9%. Unless otherwise stated: all metrics reflect
South32's share.
t
Tonne.
Target
Target is defined as an intended outcome in relation to which we have
identified one or more pathways for delivery of that outcome, subject to
certain assumptions or conditions.
Total recordable injury frequency (TRIF)
(The sum of recordable injuries x 1,000,000) ÷ exposure hours, for employees
and contractors. This is stated in units of per million hours worked for
employees and contractors. We adopt the United States Government Occupational
Safety and Health Administration (OSHA) guidelines for the recording and
reporting of occupational injuries and illnesses.
Underlying earnings attributable to members
Underlying earnings attributable to members is profit/(loss) after tax, net of
amounts attributable to non-controlling interests and earnings adjustment
items, from continuing and discontinued operations. Underlying earnings
attributable to members is the key measure that South32 uses to assess the
performance of the South32 Group, make decisions on the allocation of
resources and assess senior management's performance.
Underlying EBIT
Underlying EBIT is profit/loss before net finance income/costs, tax and any
earnings adjustments, including impairments, from continuing and discontinued
operations. The performance of each of the South32 operations and operational
management is assessed based on Underlying EBIT. In order to calculate
Underlying EBIT, the following items are adjusted as applicable each period,
irrespective of materiality: Exchange rate gains/losses on restatement of
monetary items; Impairment losses/reversals; Gains/losses on disposal and
consolidation of interests in operations; Gains/losses on non-trading
derivative instruments and contingent consideration measured at fair value
through profit or loss; Major corporate restructures; Joint venture
adjustments; Exchange rate variations on net cash/debt; Tax effect of earnings
adjustments; and Exchange rate variations on tax balances. In addition, items
that do not reflect the underlying operations of South32, and are
individually, or in combination with other related earnings adjustments,
significant to the financial statements, are excluded to determine Underlying
earnings. When applicable, significant items are detailed in the Financial
Information.
Underlying EBIT margin
Comprises Underlying EBIT excluding third party products and services EBIT,
divided by Underlying revenue excluding third party products and services
revenue.
Underlying EBITDA
Underlying EBITDA is Underlying EBIT before Underlying depreciation and
amortisation, and excludes third party products and services EBITDA. In order
to calculate Underlying EBITDA, the following items are adjusted as applicable
each period, irrespective of materiality: Exchange rate gains/losses on
restatement of monetary items; Impairment losses/reversals; Gains/losses on
disposal and consolidation of interests in operations; Gains/losses on
non-trading derivative instruments and contingent consideration measured at
fair value through profit or loss; Major corporate restructures; Joint venture
adjustments; Exchange rate variations on net cash/debt; Tax effect of earnings
adjustments; and Exchange rate variations on tax balances. In addition, items
that do not reflect the underlying operations of South32, and are
individually, or in combination with other related earnings adjustments,
significant to the financial statements, are excluded to determine Underlying
earnings. When applicable, significant items are detailed in the Financial
Information.
Underlying EBITDA margin
Comprises Underlying EBITDA excluding third party products and services
EBITDA, divided by Underlying revenue excluding third party products and
services revenue. Also referred to as operating margin.
Underlying Effective Tax Rate (ETR)
Underlying ETR is Underlying income tax expense, including royalty related
tax, divided by Underlying profit subject to tax.
Underlying revenue
Underlying revenue includes revenue from third party products and services.
US$B
US$ billion.
US$M
US$ million.
SOUTH32
FINANCIAL
INFORMATION
For the half year ended 31 December 2025
Contents
Consolidated income statement 37
Consolidated statement of comprehensive income 38
Consolidated balance sheet 39
Consolidated cash flow statement 40
Consolidated statement of changes in equity 41
Notes to financial statements
1. Reporting entity 42
2. Basis of preparation 42
3. Segment information 43
4. Dividends 49
5. Earnings per share 49
6. Net finance income/(costs) 50
7. Financial assets and financial liabilities 50
8. Equity accounted investments 53
9. Disposal of subsidiaries 53
10. Subsequent events 55
Directors' declaration 56
Directors' report 57
Lead auditor's independence declaration 59
Independent auditor's review report 61
Consolidated Income Statement
for the half year ended 31 December 2025
US$M Note H1 FY26 H1 FY25
Restated(1)
Continuing operations
Revenue:
Group production 2,628 2,681
Third party products and services 181 203
3 2,809 2,884
Other income 59 60
Expenses excluding finance costs (2,451) (2,536)
Share of profit/(loss) of equity accounted investments 8 115 80
Operating profit/(loss) from continuing operations 532 488
Comprising:
Group production 526 478
Third party products and services 6 10
Operating profit/(loss) from continuing operations 532 488
Finance income 136 131
Finance costs (128) (65)
Net finance income/(costs) 6 8 66
Profit/(loss) before tax from continuing operations 540 554
Income tax (expense)/benefit (108) (198)
Profit/(loss) for the period from continuing operations 432 356
Discontinued operations
Profit/(loss) after tax from discontinued operations 9 31 3
Profit/(loss) for the period 463 359
Attributable to:
Equity holders of South32 Limited 464 360
Non-controlling interests (1) (1)
Profit/(loss) for the period from continuing operations attributable to equity
holders of South32 Limited:
Basic earnings/(loss) per share (cents) 5 9.6 7.9
Diluted earnings/(loss) per share (cents) 5 9.6 7.9
Profit/(loss) for the period attributable to equity holders of South32
Limited:
Basic earnings/(loss) per share (cents) 5 10.3 8.0
Diluted earnings/(loss) per share (cents) 5 10.3 8.0
1. Refer to note 9 Disposal of subsidiaries.
The accompanying notes form part of the half year consolidated financial
statements.
Consolidated statement of comprehensive income
for the half year ended 31 December 2025
US$M H1 FY26 H1 FY25
Profit/(loss) for the period 463 359
Other comprehensive income
Items that may be reclassified to the Consolidated income statement:
Translation of foreign operations (2) (2)
Share of other comprehensive income/(loss) of equity accounted investments - 2
Total items that may be reclassified to the Consolidated income statement (2) -
Items that will not be reclassified to the Consolidated income statement:
Investments in equity instruments designated as fair value through other
comprehensive income (FVOCI):
Net fair value gains/(losses) 114 19
Income tax (expense)/benefit (25) (6)
Share of other comprehensive income/(loss) of equity accounted investments (1) -
Total items that will not be reclassified to the Consolidated income statement 88 13
Total other comprehensive income/(loss) 86 13
Total comprehensive income/(loss) 549 372
Attributable to:
Equity holders of South32 Limited 551 374
Non-controlling interests (2) (2)
The accompanying notes form part of the half year consolidated financial
statements.
Consolidated balance sheet
for the half year ended 31 December 2025
US$M Note H1 FY26 FY25
ASSETS
Current assets
Cash and cash equivalents 1,664 1,677
Trade and other receivables 859 809
Other financial assets 7 - 7
Inventories 942 935
Current tax assets 12 11
Other assets 52 54
Assets held for sale - 306
Total current assets 3,529 3,799
Non-current assets
Trade and other receivables 1,920 2,000
Other financial assets 7 270 184
Inventories 37 36
Property, plant and equipment 6,736 6,429
Intangible assets 202 196
Equity accounted investments 643 590
Deferred tax assets 453 486
Other assets 7 7
Total non-current assets 10,268 9,928
Total assets 13,797 13,727
LIABILITIES
Current liabilities
Trade and other payables 702 802
Interest bearing liabilities 356 267
Other financial liabilities 7 5 -
Current tax payables 37 40
Provisions 191 185
Deferred income 10 8
Liabilities directly associated with assets held for sale - 264
Total current liabilities 1,301 1,566
Non-current liabilities
Interest bearing liabilities 1,333 1,367
Other financial liabilities 7 24 78
Deferred tax liabilities 164 175
Provisions 1,719 1,684
Total non-current liabilities 3,240 3,304
Total liabilities 4,541 4,870
Net assets 9,256 8,857
EQUITY
Share capital 13,125 13,160
Treasury shares (16) (25)
Reserves (3,494) (3,567)
Accumulated losses (371) (723)
Total equity attributable to equity holders of South32 Limited 9,244 8,845
Non-controlling interests 12 12
Total equity 9,256 8,857
The accompanying notes form part of the half year consolidated financial
statements.
Consolidated cash flow statement
for the half year ended 31 December 2025
US$M H1 FY26 H1 FY25
Restated(1)
Operating activities
Profit/(loss) before tax from continuing operations 540 554
Profit/(loss) before tax from discontinued operations 28 26
Adjustments for:
Significant items(2) 54 (50)
Depreciation and amortisation expense 214 255
Impairment losses/(reversals) of financial assets (77) 71
Employee share awards expense 9 10
Net finance (income)/costs (5) (60)
Share of (profit)/loss of equity accounted investments (115) (80)
(Gains)/losses on disposal of subsidiaries and joint operations (21) 47
Unrealised (gains)/losses on derivative instruments and contingent (9) (3)
consideration measured at fair value through profit or loss (FVTPL)
Other non-cash or non-operating items - (3)
Changes in assets and liabilities:
Trade and other receivables 16 (10)
Inventories (30) (115)
Trade and other payables (101) (95)
Provisions and other liabilities (15) (47)
Cash generated from operations 488 500
Interest received 235 119
Interest paid (54) (55)
Income tax paid (129) (116)
Dividends received 1 2
Net cash flows from operating activities 541 450
Investing activities
Purchase of property, plant and equipment (498) (457)
Purchase of intangible assets (10) (2)
Exploration expenditure (35) (39)
Exploration expenditure expensed and included in operating cash flows 19 20
Investment in financial assets (60) (21)
Proceeds from financial assets 62 29
Payments for the acquisition of subsidiaries and joint operations, net of - (4)
their cash
Proceeds from the disposal of subsidiaries and joint operations, net of their 10 954
cash
Payments for preference shares issued by equity accounted investments (24) (63)
Proceeds from redemption of preference shares issued by equity accounted 84 -
investments
Net cash flows from investing activities (452) 417
Financing activities
Proceeds from interest bearing liabilities 65 121
Repayment of interest bearing liabilities (91) (59)
Purchase of shares by Employee Share Ownership Plan (ESOP) Trusts (4) (5)
Share buy-back (35) (29)
Dividends paid (117) (140)
Contributions from non-controlling interests - 4
Net cash flows from financing activities (182) (108)
Net increase/(decrease) in cash and cash equivalents (93) 759
Cash and cash equivalents, net of overdrafts, at the beginning of the 1,757 842
period(3)
Effect of foreign exchange rate changes on cash and cash equivalents - (1)
Cash and cash equivalents, net of overdrafts, at the end of the period 1,664 1,600
1. Refer to note 9 Disposal of subsidiaries.
2. H1 FY26 relates to non-cash significant items, refer to note
3(b)(ii) Significant items. H1 FY25 relates to cash flows from significant
items recognised in prior periods.
3. H1 FY26 cash and cash equivalents at the beginning of the
period includes US$80 million classified as held for sale as part of the Cerro
Matoso disposal group. Refer to note 9 Disposal of subsidiaries.
The accompanying notes form part of the half year consolidated financial
statements.
Attributable to equity holders of South32 Limited
US$M Share capital Treasury shares Financial assets reserve(1) Employee share awards reserve(2) Other reserves(3) Accumulated losses Total Non-controlling interests(4) Total equity
Balance as at 1 July 2025 13,160 (25) (18) 46 (3,595) (723) 8,845 12 8,857
Profit/(loss) for the period - - - - - 464 464 (1) 463
Other comprehensive income/(loss) - - 89 - (1) (1) 87 (1) 86
Total comprehensive income/(loss) - - 89 - (1) 463 551 (2) 549
Transactions with owners:
Dividends - - - - - (117) (117) - (117)
Shares bought back and cancelled (35) - - - - - (35) - (35)
Employee share entitlements for unvested awards, net of tax - - - 11 - - 11 - 11
Employee share awards vested and lapsed, net of tax - 13 - (24) - 6 (5) - (5)
Purchase of shares by ESOP Trusts - (4) - - - - (4) - (4)
Equity issued to holders of non-controlling interest - - - - (2) - (2) 2 -
Balance as at 31 December 2025 13,125 (16) 71 33 (3,598) (371) 9,244 12 9,256
Balance as at 1 July 2024 13,216 (43) (43) 58 (3,590) (638) 8,960 11 8,971
Profit/(loss) for the period - - - - - 360 360 (1) 359
Other comprehensive income/(loss) - - 13 - 1 - 14 (1) 13
Total comprehensive income/(loss) - - 13 - 1 360 374 (2) 372
Transactions with owners:
Dividends - - - - - (140) (140) - (140)
Shares bought back and cancelled (29) - - - - - (29) - (29)
Employee share entitlements for unvested awards, net of tax - - - 7 - - 7 - 7
Employee share awards vested and lapsed, net of tax - 27 - (29) - - (2) - (2)
Purchase of shares by ESOP Trusts - (5) - - - - (5) - (5)
Equity issued to holders of non-controlling interest - - - - - - - 4 4
Balance as at 31 December 2024 13,187 (21) (30) 36 (3,589) (418) 9,165 13 9,178
1. Represents the fair value movement of investments in equity
instruments designated as FVOCI.
2. Represents the accrued employee entitlements to share awards
that have not yet vested.
3. Primarily consists of the common control transaction reserve of
US$3,569 million, which reflects the difference between consideration paid and
the carrying value of assets and liabilities acquired, as well as the
gains/losses on disposal of entities, as part of the Group's demerger from BHP
Billiton in 2015.
4. Relates to the minority shareholder (49.9 per cent) of Minera
Sud Argentina S.A., which holds the Chita Valley copper porphyry exploration
project in Argentina.
The accompanying notes form part of the half year consolidated financial
statements.
Notes to financial statements - Basis of preparation
The consolidated financial statements of South32 Limited (referred to as the
Company) and its subsidiaries and joint arrangements (collectively, the Group)
for the half year ended 31 December 2025 were authorised for issue in
accordance with a resolution of the Directors on 12 February 2026.
1.Reporting entity
South32 Limited is a for-profit company limited by shares incorporated in
Australia. South32 Limited has a primary listing on the Australian Securities
Exchange (ASX), a secondary listing on the Johannesburg Stock Exchange (JSE),
is admitted to listing in the equity shares (international commercial
companies secondary listing) category of the Official List of the UK Financial
Conduct Authority and its ordinary shares are traded on the London Stock
Exchange (LSE).
The nature of the operations and principal activities of the Group are
described in note 3 Segment information.
2.Basis of preparation
The half year consolidated financial statements are general purpose condensed
financial statements which:
- Have been prepared in accordance with AASB 134 Interim Financial
Reporting, IAS 34 Interim Financial Reporting and the Corporations Act 2001;
- Have been prepared on a historical cost basis, except for
post-retirement assets and obligations, derivative financial instruments and
certain other financial assets and liabilities which are required to be
measured at fair value;
- Are presented in US dollars, all values are rounded to the
nearest million dollars (US$M or US$ million) unless otherwise stated, in
accordance with ASIC Corporations (Rounding in Financial/Directors' Reports)
Instrument 2016/191; and
- Have been prepared on the basis of accounting policies and
methods of computation consistent with those applied in the consolidated
financial statements for the year ended 30 June 2025.
The preparation of the half year consolidated financial statements has
required management to apply accounting policies and methodologies that are
based on complex and subjective estimates, assumptions and judgements.
Management based its estimates and judgements on historical experience and
assumptions it believes to be reasonable and realistic based on the current
environment. Actual results may differ from those reported in these statements
due to the uncertainties that characterise the assumptions and conditions on
which the estimates are based. The significant judgements made by management
in applying the Group's accounting policies and the key sources of estimation
uncertainty were the same as those that applied to the consolidated financial
statements for the year ended 30 June 2025.
For a full understanding of the financial performance and financial position
of the Group, it is recommended that the half year consolidated financial
statements be read in conjunction with the consolidated financial statements
for the year ended 30 June 2025.
3.Segment information
(a)Description of segments
The operating segments (also referred to as operations) are organised and
managed separately according to their location and the nature of products
produced.
The Lead Team (the chief operating decision makers) and the Board of Directors
monitor the segment results regularly for the purpose of making decisions
about resource allocation and assessing performance.
The principal activities of each operating segment are summarised as follows:
Operating segment Principal activities
Worsley Alumina Integrated bauxite mine and alumina refinery in Australia
Brazil Alumina Integrated bauxite mine and alumina refinery in Brazil
Brazil Aluminium Aluminium smelter in Brazil
Hillside Aluminium Aluminium smelter in South Africa
Mozal Aluminium(1) Aluminium smelter in Mozambique
Sierra Gorda Copper mine in Chile
Cannington Silver, lead and zinc mine in Australia
Hermosa Base metals exploration and development project in the United States
Australia Manganese Manganese ore mine in Australia
South Africa Manganese Manganese ore mines in South Africa
Cerro Matoso(2) Integrated laterite ferronickel mine and smelting complex in Colombia
Illawarra Metallurgical Coal(3) Metallurgical coal mines in Australia
1. On 16 December 2025, the Group announced that Mozal Aluminium
will transition to care and maintenance in March 2026. Refer to note 3(b)(ii)
Significant items.
2. On 1 December 2025, the Group completed the sale of Cerro
Matoso. Refer to note 9 Disposal of subsidiaries.
3. On 29 August 2024, the Group completed the sale of Illawarra
Metallurgical Coal. Refer to note 9 Disposal of subsidiaries.
All operations are operated by the Group except Brazil Alumina, Brazil
Aluminium and Sierra Gorda.
(b)Segment results
The underlying information presented in the Group's segment results include
non-IFRS financial measures and differs from the statutory financial
information as it reflects the Group's interest in material equity accounted
joint ventures on a proportional consolidation basis.
The Group's material equity accounted joint ventures are Australia Manganese
and South Africa Manganese, inclusive of an allocation of Manganese Marketing,
and Sierra Gorda. Refer to note 8 Equity accounted investments.
Segment performance is measured by Underlying revenue, Underlying EBIT and
Underlying EBITDA. Underlying revenue is revenue, adjusted to reflect material
equity accounted joint ventures on a proportional consolidation basis.
Underlying EBIT is profit/(loss) before net finance income/(costs), income tax
(expense)/benefit, and other earnings adjustment items, all adjusted to
reflect material equity accounted joint ventures on a proportional
consolidation basis. Underlying EBITDA is Underlying EBIT before depreciation
and amortisation, adjusted to reflect material equity accounted joint ventures
on a proportional consolidation basis.
Reconciliations of the underlying information to the statutory information
included in the Group's consolidated financial statements are set out in note
3(b)(i) Underlying results reconciliation, including joint venture adjustments
which reconcile the proportional consolidation of the material equity
accounted joint ventures back to their statutory equity accounting positions.
The Group separately discloses sales of group production from sales of third
party products and services because of the significant difference in profit
margin earned on these sales.
It is the Group's policy that inter-segment transactions are made on an arm's
length basis.
Group and unallocated items/eliminations represent group centre functions and
consolidation adjustments.
Group financing and income taxes are primarily managed on a Group basis and
are not allocated to operating segments.
Total assets and liabilities for each continuing operating segment represent
operating assets and liabilities which predominantly exclude the carrying
amount of non-material equity accounted investments, cash, interest bearing
liabilities, tax balances and certain other financial assets and liabilities.
3.Segment information continued
(b)Segment results continued
Continuing operations Discontinued operations
H1 FY26 Worsley Alumina Brazil Alumina Brazil Aluminium Hillside Aluminium Mozal Aluminium Sierra Gorda(1) Cannington Hermosa Australia Manganese(1) Group and unallocated items/ eliminations Group underlying results from continuing operations Cerro Matoso(2) Illawarra Metallurgical Coal(2) Group underlying results(1)
US$M
South Africa Manganese(1)
Revenue from customers 747 268 204 1,017 473 520 350 - 304 165 (343) 3,705 193 - 3,898
Other revenue(3) (1) (1) - 4 - 58 46 - 2 2 - 110 - - 110
Total underlying revenue 746 267 204 1,021 473 578 396 - 306 167 (343) 3,815 193 - 4,008
Comprising:
Group production 358 176 204 1,021 473 578 396 - 306 167 - 3,679 193 - 3,872
Third party products and services(4) - - - - - - - - - - 136 136 - - 136
Inter-segment revenue 388 91 - - - - - - - - (479) - - - -
Total underlying revenue 746 267 204 1,021 473 578 396 - 306 167 (343) 3,815 193 - 4,008
Underlying EBITDA 153 25 (12) 204 59 393 211 (24) 107 8 (28) 1,096 11 - 1,107
Underlying depreciation and amortisation (83) (28) (3) (33) (1) (95) (48) (4) (41) (10) (14) (360) - - (360)
Underlying EBIT 70 (3) (15) 171 58 298 163 (28) 66 (2) (42) 736 11 - 747
Comprising:
Group production 72 10 (15) 171 58 301 164 (28) 69 (2) (33) 767 12 - 779
Exploration expenditure expensed (2) - - - - (3) (1) - (3) - (15) (24) (1) - (25)
Third party products and services(4) - - - - - - - - - - 6 6 - - 6
Share of profit/(loss) of equity accounted investments - (13) - - - - - - - - - (13) - - (13)
Underlying EBIT 70 (3) (15) 171 58 298 163 (28) 66 (2) (42) 736 11 - 747
Underlying net finance costs (77) (4) - (81)
Underlying income tax expense (207) - - (207)
Underlying royalty related tax expense (25) - - (25)
Underlying earnings 427 7 - 434
Total adjustments to profit/(loss)(5) 5 5 19 29
Profit/(loss) for the period 432 12 19 463
Underlying exploration expenditure 2 - - - - 7 3 14 3 - 15 44 1 - 45
Underlying capital expenditure(6) 73 5 9 34 4 116 23 338 46 18 4 670 8 - 678
Underlying equity accounted investments - 2 - - - - - - - - - 2 - - 2
Total underlying assets(7) 2,770 869 208 1,103 239 2,107 583 2,579 762 394 3,224 14,838 - - 14,838
Total underlying liabilities(7) 1,048 198 69 366 190 217 448 181 498 128 2,239 5,582 - - 5,582
1. The segment information reflects the Group's interest in
material equity accounted joint ventures and is presented on a proportional
consolidation basis, which is the measure used by the Group's management to
assess their performance. The Group's underlying results includes the
proportional elimination of revenue and corresponding expenses relating to
freight services provided by the Group to material joint ventures of US$61
million and third party product revenue of US$16 million included in Group and
unallocated items/eliminations. Refer to note 3(b)(i) Underlying results
reconciliation for the joint venture adjustments that reconcile the underlying
proportional consolidation to the statutory financial information.
2. The Cerro Matoso and Illawarra Metallurgical Coal operating
segments have been classified as discontinued operations. Refer to note 9
Disposal of subsidiaries.
3. Underlying other revenue relates to fair value movements on
provisionally priced contracts.
4. Underlying revenue on third party products and services sold
from continuing operations comprises US$36 million for aluminium, US$16
million for manganese, US$44 million for freight services and US$40 million
for raw materials. Underlying EBIT on third party products and services sold
from continuing operations comprises US$3 million for aluminium, US$4 million
for alumina, US$(2) million for freight services and US$1 million for raw
materials.
5. Represents the total of all adjustments made to operating
profit/(loss), net finance income/(costs) and income tax (expense)/benefit.
Refer to note 3(b)(i) Underlying results reconciliation for further details.
6. Underlying capital expenditure excludes the purchase of
intangibles and capitalised exploration expenditure.
7. Total underlying assets and liabilities for each continuing
operating segment represent operating assets and liabilities which
predominantly exclude the carrying amount of non-material equity accounted
investments, cash, interest bearing liabilities, tax balances and certain
other financial assets and liabilities.
3.Segment information continued
(b)Segment results continued
Continuing operations Discontinued operations
H1 FY25 Restated(1) Worsley Alumina Brazil Alumina Brazil Aluminium Hillside Aluminium Mozal Aluminium Sierra Gorda(2) Cannington Hermosa Australia Manganese(2) Group and unallocated items/ eliminations Group underlying results from continuing operations Cerro Matoso(1) Illawarra Metallurgical Coal(1) Group underlying results(2)
US$M
South Africa Manganese(2)
Revenue from customers 915 405 153 985 487 419 332 - - 203 (403) 3,496 239 145 3,880
Other revenue(3) 1 3 - 1 1 (14) (9) - - (12) - (29) - (1) (30)
Total underlying revenue 916 408 153 986 488 405 323 - - 191 (403) 3,467 239 144 3,850
Comprising:
Group production 451 280 153 986 488 405 323 - - 191 - 3,277 239 116 3,632
Third party products and services(4) - - - - - - - - - - 190 190 - 28 218
Inter-segment revenue 465 128 - - - - - - - - (593) - - - -
Total underlying revenue 916 408 153 986 488 405 323 - - 191 (403) 3,467 239 144 3,850
Underlying EBITDA 369 174 (53) 123 66 215 130 (15) (31) 28 (82) 924 44 50 1,018
Underlying depreciation and amortisation (89) (28) (2) (34) (33) (87) (41) (2) (3) (10) (14) (343) (12) - (355)
Underlying EBIT 280 146 (55) 89 33 128 89 (17) (34) 18 (96) 581 32 50 663
Comprising:
Group production 280 159 (55) 89 33 128 90 (17) (31) 18 (88) 606 33 50 689
Exploration expenditure expensed - - - - - - (1) - (3) - (18) (22) (1) - (23)
Third party products and services(4) - - - - - - - - - - 10 10 - - 10
Share of profit/(loss) of equity accounted investments - (13) - - - - - - - - - (13) - - (13)
Underlying EBIT 280 146 (55) 89 33 128 89 (17) (34) 18 (96) 581 32 50 663
Underlying net finance costs (87) (3) (2) (92)
Underlying income tax expense (166) (9) (14) (189)
Underlying royalty related tax expense (8) - - (8)
Underlying earnings 320 20 34 374
Total adjustments to profit/(loss)(5) 36 (3) (48) (15)
Profit/(loss) for the period 356 17 (14) 359
Underlying exploration expenditure - - - - - 7 3 16 3 - 18 47 1 1 49
Underlying capital expenditure(6) 50 27 6 19 12 106 23 248 47 25 2 565 13 57 635
Underlying equity accounted investments(8) - 15 - - - - - - - - - 15 - - 15
Total underlying assets(7) 2,767 842 130 1,157 353 1,982 576 2,228 737 385 3,259 14,416 330 - 14,746
Total underlying liabilities(7) 1,060 204 59 369 201 213 445 196 497 133 2,246 5,623 266 - 5,889
1. Refer to note 9 Disposal of subsidiaries.
2. The segment information reflects the Group's interest in
material equity accounted joint ventures and is presented on a proportional
consolidation basis, which is the measure used by the Group's management to
assess their performance. The Group's underlying results includes the
proportional elimination of revenue and corresponding expenses relating to
freight services provided by the Group to material joint ventures of US$32
million and third party product revenue of US$19 million included in Group and
unallocated items/eliminations. Refer to note 3(b)(i) Underlying results
reconciliation for the joint venture adjustments that reconcile the underlying
proportional consolidation to the statutory financial information.
3. Underlying other revenue relates to fair value movements on
provisionally priced contracts.
4. Underlying revenue on third party products and services sold
from continuing operations comprises US$87 million for aluminium, US$6 million
for alumina, US$19 million for manganese, US$26 million for freight services
and US$52 million for raw materials. Underlying EBIT on third party products
and services sold from continuing operations comprises US$2 million for
aluminium, US$10 million for alumina and US$(2) million for freight services.
5. Represents the total of all adjustments made to operating
profit/(loss), net finance income/(costs) and income tax (expense)/benefit.
Refer to note 3(b)(i) Underlying results reconciliation for further details.
6. Underlying capital expenditure excludes the purchase of
intangibles and capitalised exploration expenditure.
7. Underlying equity accounted investments, total underlying
assets and total underlying liabilities for each operating segment are as at
30 June 2025. Total underlying assets and liabilities for each operating
segment represent operating assets and liabilities which predominantly exclude
the carrying amount of non-material equity accounted investments, cash,
interest bearing liabilities, tax balances and certain other financial assets
and liabilities.
3.Segment information continued
(b)Segment results continued
(i)Underlying results reconciliation
The following tables reconcile the underlying segment information to the
statutory information included in the Group's half year consolidated financial
statements:
H1 FY26 Continuing operations Discontinued operations(1) Total
US$M
Underlying EBIT 736 11 747
Significant items(2) (54) - (54)
Joint venture adjustments(3,4) (241) - (241)
Exchange rate gains/(losses) on restatement of monetary items(5) (7) (1) (8)
Impairment (losses)/reversals of financial assets(5,6) 77 - 77
Gain on the disposal of subsidiaries and joint operations(7) - 21 21
Gains/(losses) on derivative instruments and contingent consideration measured 21 - 21
at FVTPL(5,8)
Operating profit/(loss) 532 31 563
Underlying net finance cost (77) (4) (81)
Joint venture adjustments(3,4) 111 - 111
Exchange rate variations on net cash/(debt) (26) 1 (25)
Net finance income/(costs) 8 (3) 5
Underlying income tax expense (207) - (207)
Underlying royalty related tax expense (25) - (25)
Joint venture adjustments relating to income tax expense(3,4) 72 - 72
Joint venture adjustments relating to royalty related tax expense(4,5) 25 - 25
Tax effect of other adjustments to derive Underlying EBIT 7 - 7
Tax effect of other adjustments to derive Underlying net finance costs 7 - 7
Exchange rate variations on tax balances 13 3 16
Income tax (expense)/benefit (108) 3 (105)
Underlying earnings 427 7 434
Total adjustments to profit/(loss) 5 24 29
Profit/(loss) for the period 432 31 463
Underlying earnings attributable to:
Equity holders of South32 Limited 428 7 435
Non-controlling interests (1) - (1)
1. Refer to note 9 Disposal of subsidiaries.
2. Refer to note 3(b)(ii) Significant items.
3. The segment information reflects the Group's interest in
material equity accounted joint ventures and is presented on a proportional
consolidation basis, which is the measure used by the Group's management to
assess their performance. Joint venture adjustments reconcile the proportional
consolidation to the statutory equity accounting positions, recognised in
share of profit/(loss) of equity accounted investments in the Consolidated
income statement.
4. The net impact of all joint venture adjustments to the Group's
profit/(loss) for the period amounts to US$(33) million of which US$(91)
million relates to the Sierra Gorda segment and US$58 million relates to the
Australia Manganese segment. The Sierra Gorda joint venture adjustments
include a revaluation loss of US$77 million (US$56 million post-tax) relating
to the shareholder loan payable that was eliminated from the Group's
Underlying earnings upon proportional consolidation, and a royalty related tax
expense significant item of US$34 million relating to the remeasurement of
deferred tax balances to reflect the revised royalty rates associated with the
Mining Royalty Law in Chile. The Australia Manganese joint venture adjustments
include a significant item of US$92 million (US$59 million post-tax) relating
to insurance income recognised as Australia Manganese finalised its insurance
recoveries for the impacts of Tropical Cyclone Megan at Groote Eylandt Mining
Company Pty Ltd (GEMCO) in March 2024.
5. Recognised in expenses excluding finance costs in the
Consolidated income statement.
6. Refer to note 3(b)(iii) Impairment of financial assets.
7. Includes a gain of US$2 million for the disposal of Cerro
Matoso and a gain of US$19 million in relation to the FY25 disposal of
Illawarra Metallurgical Coal following the finalisation of working capital,
net debt and capital expenditure adjustments during H1 FY26.
8. Includes a loss of US$33 million on the revaluation of the
contingent consideration receivable from the divestment of Illawarra
Metallurgical Coal and a gain of US$55 million on the revaluation of the
contingent consideration payable for the acquisition of Sierra Gorda.
3.Segment information continued
(b)Segment results continued
(i)Underlying results reconciliation continued
H1 FY25 Restated(1) Continuing operations Discontinued operations(1) Total
US$M
Underlying EBIT 581 82 663
Joint venture adjustments(2,3) (22) - (22)
Exchange rate gains/(losses) on restatement of monetary items(4) (4) (3) (7)
Impairment (losses)/reversals of financial assets(4,5) (71) - (71)
Loss on the disposal of subsidiaries and joint operations - (47) (47)
Gains/(losses) on derivative instruments and contingent consideration measured 4 - 4
at FVTPL(4,6)
Operating profit/(loss) 488 32 520
Underlying net finance cost (87) (5) (92)
Joint venture adjustments(2,3) 115 - 115
Exchange rate variations on net cash/(debt) 38 (1) 37
Net finance income/(costs) 66 (6) 60
Underlying income tax expense (166) (23) (189)
Underlying royalty related tax expense (8) - (8)
Joint venture adjustments relating to income tax expense(2,3) (1) - (1)
Joint venture adjustments relating to royalty related tax expense(2,3) 8 - 8
Tax effect of other adjustments to derive Underlying EBIT (1) 1 -
Tax effect of other adjustments to derive Underlying net finance costs (11) - (11)
Exchange rate variations on tax balances (19) (1) (20)
Income tax (expense)/benefit (198) (23) (221)
Underlying earnings 320 54 374
Total adjustments to profit/(loss) 36 (51) (15)
Profit/(loss) for the period 356 3 359
Underlying earnings attributable to:
Equity holders of South32 Limited 321 54 375
Non-controlling interests (1) - (1)
1. Refer to note 9 Disposal of subsidiaries.
2. The segment information reflects the Group's interest in
material equity accounted joint ventures and is presented on a proportional
consolidation basis, which is the measure used by the Group's management to
assess their performance. Joint venture adjustments reconcile the proportional
consolidation to the statutory equity accounting positions, recognised in
share of profit/(loss) of equity accounted investments in the Consolidated
income statement.
3. The net impact of all joint venture adjustments to the Group's
profit/(loss) for the year amounts to US$100 million of which US$53 million
relates to the Sierra Gorda segment and US$47 million relates to the Australia
Manganese segment. The Sierra Gorda joint venture adjustments include a
revaluation gain of US$71 million (US$52 million post-tax) relating to the
shareholder loan payable that was eliminated from the Group's Underlying
earnings upon proportional consolidation. The Australia Manganese joint
venture adjustments include a significant item of US$76 million (US$48 million
post-tax) relating to the impacts of Tropical Cyclone Megan at GEMCO in March
2024, including insurance income, expenses relating to idle capacity charges,
repairs and clean-up costs.
4. Recognised in expenses excluding finance costs in the
Consolidated income statement.
5. Refer to note 3(b)(iii) Impairment of financial assets.
6. Includes a gain of US$53 million on the revaluation of the
contingent consideration receivable from the divestment of Illawarra
Metallurgical Coal and a loss of US$50 million on the revaluation of the
contingent consideration payable for the acquisition of Sierra Gorda.
3.Segment information continued
(b)Segment results continued
(i)Underlying results reconciliation continued
H1 FY26 Group underlying results Joint venture adjustments Discontinued operations adjustments(1) Group statutory results
US$M
Total revenue 4,008 (1,006) (193) 2,809
Depreciation and amortisation 360 (146) - 214
Share of profit/(loss) of equity accounted investments (13) 128 - 115
Exploration expenditure(2) 45 (10) - 35
Capital expenditure(2) 678 (180) - 498
Equity accounted investments 2 641 - 643
Total assets 14,838 (1,041) - 13,797
Total liabilities 5,582 (1,041) - 4,541
1. Refer to note 9 Disposal of subsidiaries.
2. The Group statutory results include the cash flows from
discontinued operations, consistent with the Consolidated cash flow statement.
H1 FY25 Restated(1) Group underlying results Joint venture adjustments Discontinued operations adjustments(1) Group statutory results
US$M
Total revenue 3,850 (583) (383) 2,884
Depreciation and amortisation 355 (100) (12) 243
Share of profit/(loss) of equity accounted investments (13) 93 - 80
Exploration expenditure(2) 49 (10) - 39
Capital expenditure(2) 635 (178) - 457
Equity accounted investments(3) 15 575 - 590
Total assets(3) 14,746 (1,019) - 13,727
Total liabilities(3) 5,889 (1,019) - 4,870
1. Refer to note 9 Disposal of subsidiaries.
2. The Group statutory results include the cash flows from
discontinued operations, consistent with the Consolidated cash flow statement.
3. Equity accounted investments, total assets and total
liabilities are as at 30 June 2025.
(ii)Significant items
Significant items are those items, not separately identified in note 3(b)(i)
Underlying results reconciliation, whose nature and amount are considered
material to the Group's consolidated financial statements.
H1 FY26 Gross Tax Net
US$M
Mozal Aluminium care and maintenance impacts (54) - (54)
Total significant items (54) - (54)
Mozal Aluminium care and maintenance impacts
In December 2025, the Group announced that Mozal Aluminium will transition to
care and maintenance in March 2026 as the Group has been unable to secure
sufficient and affordable electricity supply for Mozal Aluminium beyond March
2026, when the current electricity supply agreement expires. As a result, the
Group has recognised expenses in H1 FY26 that do not reflect the performance
of the underlying operation, and which have therefore been classified as
significant items.
In FY25 the Group had recognised the maximum impairment of property, plant and
equipment and intangible assets after considering the recoverable amount of
individual assets within the Mozal Aluminium cash generating unit, as well as
a write-down of inventory based on management's estimated net realisable value
of the inventory on hand at that time. In H1 FY26 the Group recognised further
inventory write-downs of US$26 million, a provision for employee redundancies
of US$25 million, and an onerous contract payable of US$3 million. These
costs, totalling US$54 million, are included in expenses excluding finance
costs in the Consolidated income statement.
There were no significant items within the Group's consolidated financial
statements for the half year ended 31 December 2024.
3.Segment information continued
(b)Segment results continued
(iii)Impairment of financial assets
The Group recognised the following impairment (losses)/reversals of financial
assets:
US$M H1 FY26 H1 FY25
Trade and other receivables 77 (71)
Total net impairment (losses)/reversals of financial assets(1) 77 (71)
1. Relates to the purchased credit impaired receivable from Sierra
Gorda.
Shareholder loan receivable from Sierra Gorda
The loan has a contractual interest rate of 8 per cent and the repayment of
the loan by Sierra Gorda is dependent on its financial performance. At
31 December 2025, the Group updated its estimated timing of the loan
repayments and as a result recognised an impairment reversal of US$77 million
(H1 FY25: impairment of US$71 million) which is included in expenses excluding
finance costs in the Consolidated income statement. The net present value of
the expected future cash flows of the loan was informed by, and is sensitive
to, the Group's copper price assumption, with a range of US$4.73/lb -
US$4.88/lb used, in real terms, and a production profile and costs based on
management's planning processes. An effective interest rate of 9 per cent, as
determined on the date of acquisition, was applied to discount the future loan
repayments.
4.Dividends
US$M H1 FY26 H1 FY25
Prior year final dividend(1) 117 140
Total dividends declared and paid during the period 117 140
1. On 28 August 2025, the Directors resolved to pay a fully
franked final dividend of US 2.6 cents per share (US$117 million) in respect
of the 2025 financial year. The dividend was paid on 16 October 2025.
5.Earnings per share
Basic earnings/(loss) per share amounts are calculated based on profit or loss
attributable to equity holders of South32 Limited and the weighted average
number of shares outstanding during the period.
Diluted earnings/(loss) per share amounts are calculated based on profit or
loss attributable to equity holders of South32 Limited and the weighted
average number of shares outstanding after adjustment for the effects of all
dilutive potential shares.
The following reflects the profit or loss and share data used in the basic and
diluted earnings/(loss) per share computations:
Profit/(loss) attributable to equity holders H1 FY26 H1 FY25
Restated(1)
US$M
Continuing operations 433 357
Discontinued operations 31 3
Profit/(loss) attributable to equity holders of South32 Limited (basic) 464 360
Profit/(loss) attributable to equity holders of South32 Limited (diluted) 464 360
1. Refer to note 9 Disposal of subsidiaries.
Weighted average number of shares H1 FY26 H1 FY25
Million
Basic earnings/(loss) per share denominator(1) 4,491 4,515
Shares contingently issuable under ESOPs 10 13
Diluted earnings/(loss) per share denominator 4,501 4,528
1. The basic earnings/(loss) per share denominator is the
aggregate of the weighted average number of shares after deduction of the
weighted average number of treasury shares outstanding and shares permanently
cancelled through the on-market share buy-back program.
Earnings/(loss) per share H1 FY26 H1 FY25
Restated(1)
US cents
Continuing operations
Basic earnings/(loss) per share 9.6 7.9
Diluted earnings/(loss) per share 9.6 7.9
Attributable to ordinary equity holders of South32 Limited
Basic earnings/(loss) per share 10.3 8.0
Diluted earnings/(loss) per share 10.3 8.0
1. Refer to note 9 Disposal of subsidiaries.
6.Net finance income/(costs)
US$M H1 FY26 H1 FY25
Restated(1)
Finance income
Interest on loans to equity accounted investments 88 91
Other interest income 48 40
Total finance income 136 131
Finance costs
Interest on borrowings (27) (29)
Interest on lease liabilities (27) (27)
Discounting on provisions and other liabilities (48) (47)
Exchange rate variations on net cash/(debt) (26) 38
Total finance costs (128) (65)
Net finance income/(costs) 8 66
1. Refer to note 9 Disposal of subsidiaries.
7.Financial assets and financial liabilities
The following table presents the financial assets and liabilities by class at
their carrying amounts:
H1 FY26 Held at FVTPL Designated as FVOCI Amortised cost Total
US$M
Financial assets
Cash and cash equivalents - - 1,664 1,664
Trade and other receivables(1,2) 146 - 598 744
Total current financial assets 146 - 2,262 2,408
Trade and other receivables(1,2) - - 1,874 1,874
Other financial assets:
Investments in equity instruments designated as FVOCI - 244 - 244
Contingent consideration receivable 26 - - 26
Total non-current financial assets 26 244 1,874 2,144
Total financial assets 172 244 4,136 4,552
Financial liabilities
Trade and other payables(3) - - 694 694
Interest bearing liabilities - - 356 356
Other financial liabilities:
Derivative contracts 5 - - 5
Total current financial liabilities 5 - 1,050 1,055
Interest bearing liabilities - - 1,333 1,333
Other financial liabilities:
Contingent consideration payable 24 - - 24
Total non-current financial liabilities 24 - 1,333 1,357
Total financial liabilities 29 - 2,383 2,412
1. Includes current loans to equity accounted investments of
US$275 million and non-current loans to equity accounted investments of
US$1,670 million.
2. Excludes current input taxes of US$115 million and non-current
input and other taxes of US$46 million included in other receivables.
3. Excludes current input taxes of US$8 million included in other
payables.
FY25 Held at FVTPL Designated as FVOCI Amortised cost Total
US$M
Financial assets
Cash and cash equivalents - - 1,677 1,677
Trade and other receivables(1,2) 133 - 578 711
Other financial assets:
Derivative contracts 7 - - 7
Total current financial assets 140 - 2,255 2,395
Trade and other receivables(1,2) - - 1,927 1,927
Other financial assets:
Investments in equity instruments designated as FVOCI - 130 - 130
Contingent consideration receivable 54 - - 54
Total non-current financial assets 54 130 1,927 2,111
Total financial assets 194 130 4,182 4,506
Financial liabilities
Trade and other payables(3) 2 - 796 798
Interest bearing liabilities - - 267 267
Total current financial liabilities 2 - 1,063 1,065
Interest bearing liabilities - - 1,367 1,367
Other financial liabilities:
Contingent consideration payable 78 - - 78
Total non-current financial liabilities 78 - 1,367 1,445
Total financial liabilities 80 - 2,430 2,510
1. Includes current loans to equity accounted investments of
US$233 million and non-current loans to equity accounted investments of
US$1,737 million.
2. Excludes current input taxes of US$98 million and non-current
input and other taxes of US$73 million included in other receivables.
3. Excludes current input taxes of US$4 million included in other
payables.
(i)Fair value measurement
The carrying values of the Group's financial assets and liabilities measured
at amortised cost are equal to or approximate their respective fair values,
except for senior unsecured notes which have a carrying value of US$693
million (FY25: US$693 million) and a fair value of US$678 million (FY25:
US$655 million), and lease liabilities with a carrying value of US$733 million
(FY25: US$713 million), for which a fair value has not been determined. The
fair value of the Group's senior unsecured notes is estimated based on quoted
market prices at the reporting date and are classified as Level 1 on the fair
value hierarchy as shown below.
For financial assets and liabilities measured at fair value, the Group uses
quoted marked prices in active markets for identical assets where available.
Where no price information is available from a quoted market source,
alternative market mechanisms or recent comparable transactions, the fair
value is estimated based on the Group's views, net of valuation allowances, to
accommodate for liquidity, modelling, credit and other risks implicit in such
estimates.
The following table shows the Group's financial assets and liabilities carried
at fair value with reference to the nature of valuation inputs used:
Level 1 Valuation is based on unadjusted quoted prices in active markets for identical
financial assets and liabilities.
Level 2 Valuation is based on inputs (other than quoted prices included in Level 1)
that are observable for the financial asset or liability, either directly
(i.e. as unquoted prices) or indirectly (i.e. derived from prices).
Level 3 Valuation includes inputs that are not based on observable market data.
H1 FY26 Level 1 Level 2 Level 3 Total
US$M
Financial assets and liabilities
Trade and other receivables - 146 - 146
Derivative contract liabilities (5) - - (5)
Investments in equity instruments designated as FVOCI(1) 233 - 11 244
Contingent consideration receivable - - 26 26
Contingent consideration payable - - (24) (24)
Total 228 146 13 387
1. Includes US$81 million for the Group's investment in Trilogy
Metals Inc., the Group's joint venture partner in Ambler Metals. In October
2025, the Group entered into an agreement to sell 8.2 million of its shares to
the U.S. Department of War for US$18 million and to grant a 10-year call
option over a further 6.2 million shares, exercisable at US$0.01 per share
following completion of the construction of the Ambler Access Project. The
transaction completion remains subject to obtaining the required exchange and
regulatory approvals prior to 31 March 2026, after which the agreement may be
terminated. As completion remains uncertain, this transaction has not been
reflected in the Group's H1 FY26 financial statements. For more information,
refer to the South32 7 October 2025 media release "South32 Backs U.S.
Government move to advance access to critical minerals in Alaska".
(i)Fair value measurement continued
FY25 Level 1 Level 2 Level 3 Total
US$M
Financial assets and liabilities
Trade and other receivables - 133 - 133
Trade and other payables - (2) - (2)
Derivative contract assets 7 - - 7
Investments in equity instruments designated as FVOCI 119 - 11 130
Contingent consideration receivable - - 54 54
Contingent consideration payable - - (78) (78)
Total 126 131 (13) 244
The following table shows the movements in the Group's Level 3 financial
assets and liabilities:
US$M H1 FY26 H1 FY25
At the beginning of the period (13) (8)
Addition of financial assets(1) 5 115
Net unrealised gains/(losses) recognised in the Consolidated income 21 3
statement(2)
At the end of the period 13 110
1. The addition in H1 FY26 relates to the price-linked contingent
consideration of up to US$100 million related to the disposal of Cerro Matoso.
Refer to note 9 Disposal of subsidiaries.
2. Recognised in expenses excluding finance costs in the
Consolidated income statement.
The fair value of the Level 3 financial assets and liabilities is determined
using inputs other than observable market data and is calculated using
appropriate valuation models, including discounted cash flow modelling, with
inputs such as commodity prices, production forecasts and inflation. The
potential effect of using reasonably possible alternative assumptions in these
models for those assets and liabilities that are material and sensitive to
level 3 valuation inputs, based on directionally changing all these inputs
either favourably or unfavourably by 10 per cent while holding all other
variables constant, is disclosed below:
Impact on carrying amount
H1 FY26 Carrying amount Significant inputs Favourable Unfavourable
US$M
Financial assets
Contingent consideration receivable 21 Coal price(1) 119 (21)
Production volumes(2)
1. Coal price inputs reflect estimates of future commodity prices.
2. Production volumes inputs reflect estimates of future
production.
8.Equity accounted investments
The Group's material interests in equity accounted investments are as
follows:
Ownership interest %
Material joint ventures Country of incorporation Principal activity H1 FY26 FY25
Australia Manganese(1,2) Australia Manganese ore mine 60 60
South Africa Manganese(1,3) South Africa Manganese ore mines 60 60
Manganese Marketing(1,4) Singapore Sales, marketing and distribution 60 60
Sierra Gorda(1,5) Chile Copper mine 45 45
1. Joint control is contractually achieved as joint venture
parties unanimously consent on decisions over the joint venture's relevant
activities.
2. Australia Manganese consists of an investment in GEMCO.
3. The Group holds a 60 per cent interest in Samancor Holdings
(Pty) Ltd (Samancor). Samancor indirectly owns 74 per cent of Hotazel
Manganese Mines (Pty) Ltd (HMM), which gives the Group its indirect legal
ownership interest of 44.4 per cent. Of the remaining 26 per cent of HMM, 17
per cent of the interests were acquired by B-BBEE entities using vendor
finance with the loans repayable via distributions attributable to these
parties, pro rata to their share in HMM. Until these loans are repaid, the
Group's interest in HMM is accounted for at 54.6 per cent.
4. Manganese Marketing consists of an investment in Samancor
Marketing Pte Ltd.
5. Sierra Gorda consists of an investment in Sierra Gorda Sociedad
Contractual Minera.
Share of profit/(loss) of equity accounted investments H1 FY26 H1 FY25
US$M
Australia Manganese 77 7
South Africa Manganese (8) 7
Manganese Marketing 5 (1)
Sierra Gorda 54 80
Individually immaterial (13) (13)
Total 115 80
9.Disposal of subsidiaries
Non-current assets and disposal groups (inclusive of directly associated
liabilities) are reclassified to current assets held for sale if their
carrying amount is highly probable to be recovered through sale rather than
through continuing use, and are available for immediate sale in their present
condition.
A discontinued operation is a component of the Group's business that
represents a separate major line of business or geographical area of
operations that has been disposed of or is classified as held for sale. When
an operation is classified as discontinued, the comparative financial results
are restated as if the operation had been discontinued from the start of the
comparative period.
Cerro Matoso
In July 2025, the Group announced its decision to enter into a binding
agreement for the sale of Cerro Matoso to an entity owned by CoreX Holding
B.V. The sale completed on 1 December 2025 and resulted in a gain on disposal
of US$2 million. The sale consideration included a nominal upfront cash
consideration and contingent consideration of up to US$100 million, subject to
customary working capital and net debt adjustments.
Cerro Matoso was classified as held for sale and presented separately on the
Group's FY25 Consolidated balance sheet. The disposal group represents the
entire Cerro Matoso segment, which comprises the Group's 99.9% interest in
Cerro Matoso S.A., 100% interest in South32 Energy S.A.S. E.S.P. and other
investment holding companies.
Cerro Matoso is an integrated laterite ferronickel mine and smelting complex
in Colombia. As a separate major component of the Group, Cerro Matoso has also
been presented as a discontinued operation in the Group's Consolidated income
statement, with the comparative financial results restated as if the operation
had been discontinued from the start of the comparative period.
The results of the discontinued operation are as follows:
US$M H1 FY26 H1 FY25
Revenue:
Group production 193 239
193 239
Other income 1 2
Expenses excluding finance costs (184) (209)
Gain on disposal of the discontinued operation 2 -
Operating profit/(loss) from a discontinued operation 12 32
Finance income 1 1
Finance costs (4) (4)
Net finance income/(costs) (3) (3)
Profit/(loss) before tax from a discontinued operation 9 29
Income tax (expense)/benefit 3 (12)
Profit/(loss) for the period from a discontinued operation 12 17
Total comprehensive income from a discontinued operation attributable to the 12 17
equity holders of South32 Limited
Basic earnings/(loss) per share (cents) 0.3 0.4
Diluted earnings/(loss) per share (cents) 0.3 0.4
The cash flows from the discontinued operation are as follows:
US$M H1 FY26 H1 FY25
Net cash flows from operating activities 2 21
Net cash flows from investment activities (27) (13)
The effect of disposal on the results and financial position of the Group is
as follows:
US$M H1 FY26
Consideration
Upfront consideration, net of transaction costs 12
Contingent price-linked consideration 5
Total consideration 17
Net assets disposed of
Cash and cash equivalents 21
Trade and other receivables 56
Inventories 109
Property, plant and equipment 86
Intangible assets 5
Current tax assets 9
Deferred tax assets 2
Other assets 1
Trade and other payables (63)
Interest bearing liabilities (4)
Provisions (207)
Net assets disposed of 15
Gain on disposal 2
Consideration received, net of transaction costs, satisfied in cash 2
Cash and cash equivalents disposed of (21)
Net cash outflow (19)
Illawarra Metallurgical Coal
In February 2024, the Group announced its decision to enter into a binding
agreement for the sale of Illawarra Metallurgical Coal to an entity owned by
Golden Energy and Resources Pte Ltd (GEAR) and M Resources Pty Ltd (M
Resources). The sale completed on 29 August 2024 and resulted in an overall
net loss on disposal of US$28 million, of which an estimated loss of US$47
million was recognised in FY25 and a gain of US$19 million recognised in H1
FY26 upon finalisation of the working capital, net debt and capital
expenditure adjustments to the upfront consideration. The sale consideration
included an upfront and deferred cash consideration of US$1,300 million,
before adjustments, and contingent price-linked consideration of up to US$350
million.
The disposal group represents the entire Illawarra Metallurgical Coal segment,
which comprises Illawarra Coal Holdings Pty Ltd and its subsidiaries, a 16.7
per cent interest in the Port Kembla Coal Terminal, and certain associated
external contractual arrangements held by South32 Marketing Pte Ltd which were
novated to Illawarra Metallurgical Coal prior to completion. As a separate
major component of the Group, Illawarra Metallurgical Coal has also been
presented as a discontinued operation in the Group's Consolidated income
statement.
The results of the discontinued operation are as follows:
US$M H1 FY26 H1 FY25
Revenue:
Group production - 116
Third party products and services - 28
- 144
Expenses excluding finance costs - (97)
Gain/(loss) on disposal of the discontinued operation 19 (47)
Operating profit/(loss) from a discontinued operation 19 -
Finance costs - (3)
Net finance income/(costs) - (3)
Profit/(loss) before tax from a discontinued operations 19 (3)
Income tax (expense)/benefit - (11)
Profit/(loss) for the period from a discontinued operation 19 (14)
Total comprehensive income/(loss) from a discontinued operation attributable 19 (14)
to the equity holders of South32 Limited
Basic earnings/(loss) per share (cents) 0.4 (0.3)
Diluted earnings/(loss) per share (cents) 0.4 (0.3)
The cash flows from the discontinued operation are as follows:
US$M H1 FY26 H1 FY25
Net cash flows from operating activities - 86
Net cash flows from investment activities 29 880
Net cash flows from financing activities - (1)
10.Subsequent events
Capital management
On 12 February 2026, the Directors resolved to pay a fully-franked interim
dividend of US 3.9 cents per share (US$175 million) in respect of the 2026
financial half year. The dividends will be paid on 2 April 2026. The
dividends have not been provided for in the half year consolidated financial
statements and will be recognised in the second half of the 2026 financial
year.
On 12 February 2026, the Directors resolved to increase the existing on-market
share buy-back program by US$100 million, with US$209 million remaining to be
returned to shareholders by 26 February 2027.
No other matters or circumstances have arisen since the end of the period that
have significantly affected, or may significantly affect, the operations,
results of operations or state of affairs of the Group in subsequent
accounting periods.
Directors' declaration
In accordance with a resolution of the Directors of the Company, we state
that:
In the opinion of the Directors:
(a) The consolidated financial statements and notes that are set out on
pages 37 to 55 for the half year ended 31 December 2025 are in accordance
with the Corporations Act 2001, including:
(i) Giving a true and fair view of the Group's financial position as
at 31 December 2025 and of its performance for the half year ended on that
date; and
(ii) Complying with Australian Accounting Standard AASB 134 Interim
Financial Reporting and Corporations Regulations 2001.
(b) There are reasonable grounds to believe that the Company will be
able to pay its debts as and when they become due and payable.
Signed in accordance with a resolution of the Board of Directors.
Karen Wood AM
Chair
Graham Kerr
Chief Executive Officer and Managing Director
Dated 12 February 2026
Directors' report
The Directors of the Group present the consolidated financial statements for
the half year ended 31 December 2025 and the auditor's review report thereon.
Directors
The Directors of the Company, both during and since the end of the period,
are:
Ms Karen Wood AM
Mr Graham Kerr
Mr Frank Cooper AO (retired 23 October 2025)
Dr Xiaoling Liu
Mr Carlos Mesquita
Dr Ntombifuthi (Futhi) Mtoba (retired 23 October 2025)
Ms Jane Nelson
Mr Wayne Osborn
Ms Sharon Warburton
Mr Stephen Pearce
Ms Mandlesilo (Mandla) Msimang
Mr Geoff Healy (appointed 2 December 2025)
The company secretary of the Company, both during and since the end of the
period, is Claire Tolcon.
Review and results of operations
A review of the operations of the consolidated entity during the period and of
the results of those operations is contained on pages 3 to 32.
Strategic risks and uncertainties
Due to the international scope of the Group's operations and the industries in
which it is engaged, there are a number of risk factors and uncertainties
which could have an effect on the Group's results and operations over the next
six months.
The following information outlines the most significant strategic exposures
identified across the Group. The risks are not listed in any particular order:
- Keeping our people safe and well
- Portfolio reshaping
- Climate change and environment
- Maintain, realise or enhance the value of our Mineral Resources
and Ore Reserves
- Cybersecurity and privacy
- Predictable operational performance
- Delivering our project portfolio
- Supply chain security
- Shaping our culture and managing diverse talent
- Evolving societal expectations
- Political risks, actions by government and/or authorities
- Global economic uncertainty and liquidity
Further information on these risks and how they are managed can be found on
pages 64 to 73 of the Annual Report for the year ended 30 June 2025, a copy
of which is available on the Group's website at www.south32.net
(http://www.south32.net) .
Events subsequent to the balance sheet date
Refer to note 10 Subsequent events to the consolidated financial statements on
page 55.
No other matters or circumstances have arisen since the end of the period that
have significantly affected, or may significantly affect, the operations,
results of operations or state of affairs of the Group in subsequent
accounting periods.
UK responsibility statements
The Directors state that to the best of their knowledge the Financial Results
and Outlook on pages 3 to 32 is compliant with DTR 4.2.7R and DTR 4.2.8R of
the Disclosure Guidance and Transparency Rules in the United Kingdom, namely:
(a) Includes an indication of important events that have occurred during the first
six months of the financial year, and their impact on the condensed set of
financial statements, and a description of the principal risks and
uncertainties for the remaining six months of the financial year; and
(b) Disclosure has been made for related party transactions that have taken place
in the first six months of the current financial year and that have materially
affected the financial position or performance of the enterprise during that
period, and any changes in the related party transactions described in the
last annual report that could have a material effect on the financial position
or performance of the enterprise in the first six months of the current
financial year.
Lead Auditor's Independence Declaration
A copy of the lead auditor's independence declaration as required under
Section 307C of the Corporations Act 2001 is set out on page 59.
Rounding of amounts
The Australian Securities and Investments Commission (ASIC) Corporations
(Rounding in Financial/Directors' Reports) Instrument 2016/191 applies to the
Group and amounts in the half year consolidated financial statements and this
Directors' Report have been rounded in accordance with this instrument to the
nearest million US dollars, unless stated otherwise.
This Directors' Report is made in accordance with a resolution of the Board.
Karen Wood AM Graham Kerr
Chair Chief Executive Officer and Managing Director
Dated 12 February 2026
Lead Auditor's Independence Declaration under
Section 307C of the Corporations Act 2001
To the Directors of South32 Limited
I declare that, to the best of my knowledge and belief, in relation to the
review of South32 Limited for the half-year ended 31 December 2025 there have
been:
1. no contraventions of the auditor independence requirements as set
out in the Corporations Act 2001 in relation to the review; and
2. no contraventions of any applicable code of professional conduct in
relation to the review.
KPMG Jane Bailey
Partner
Perth
12 February 2026
KPMG, an Australian partnership and a member firm of the KPMG global
organisation of independent member firms affiliated with KPMG International
Limited, a private English company limited by guarantee. All rights reserved.
The KPMG name and logo are trademarks used under license by the independent
member firms of the KPMG global organisation. Liability limited by a scheme
approved under Professional Standards Legislation.
Independent Auditor's Review Report
To the shareholders of South32 Limited
Conclusion
We have reviewed the accompanying Half-year Consolidated Financial Statements The Half-year Consolidated Financial Statements comprises:
of South32 Limited.
- Consolidated balance sheet as at 31 December 2025;
Based on our review, which is not an audit, we have not become aware of any
matter that makes us believe that the Half-year Consolidated Financial - Consolidated income statement, Consolidated statement of
Statements of South32 Limited does not comply with the Corporations Act 2001, comprehensive income, Consolidated statement of changes in equity and
including: Consolidated cash flow statement for the half-year ended on that date;
- Giving a true and fair view of the Group's financial position as - Notes 1 to 10 comprising a summary of material accounting
at 31 December 2025 and of its performance for the half-year ended on that policies and other explanatory information; and
date; and
- The Directors' Declaration.
- Complying with Australian Accounting Standard AASB 134 Interim
Financial Reporting and the Corporations Regulations 2001. The Group comprises South32 Limited (the Company) and the entities it
controlled at the half year's end or from time to time during the half-year.
Basis for Conclusion
We conducted our review in accordance with ASRE 2410 Review of a Financial
Report Performed by the Independent Auditor of the Entity and ISRE 2410 Review
of interim Financial Information Performed by the Independent Auditor of the
Entity. Our responsibilities are further described in the Auditor's
Responsibilities for the Review of the Half-year Consolidated Financial
Statements section of our report.
We are independent of the Group in accordance with the auditor independence
requirements of the Corporations Act 2001 and the ethical requirements of the
APES 110 Code of Ethics for Professional Accountants (including Independence
Standards) issued by the Accounting Professional & Ethical Standards Board
Limited (the Code) that are relevant to audits of annual financial reports of
public interest entities in Australia. We have fulfilled our other ethical
responsibilities in accordance with these requirements.
KPMG, an Australian partnership and a member firm of the KPMG global
organisation of independent member firms affiliated with KPMG International
Limited, a private English company limited by guarantee. All rights reserved.
The KPMG name and logo are trademarks used under license by the independent
member firms of the KPMG global organisation. Liability limited by a scheme
approved under Professional Standards Legislation.
Responsibilities of the Directors for the Half-year Consolidated Financial
Statements
The Directors of the Company are responsible for:
- The preparation of the Half-year Consolidated Financial
Statements that gives a true and fair view in accordance with Australian
Accounting Standards and the Corporations Act 2001; and
- Such internal control as the Directors determine is necessary to
enable the preparation of the Half-year Consolidated Financial Statements that
gives a true and fair view and is free from material misstatement, whether due
to fraud or error.
Auditor's Responsibilities for the Review of the Half-year Consolidated
Financial Statements
Our responsibility is to express a conclusion on the Half-year Consolidated
Financial Statements based on our review. ASRE 2410 and ISRE 2410 require us
to conclude whether we have become aware of any matter that makes us believe
that the Half-year Consolidated Financial Statements does not comply with the
Corporations Act 2001 including giving a true and fair view of the Group's
financial position as at 31 December 2025 and its performance for the
half-year ended on that date, and complying with Australian Accounting
Standard AASB 134 Interim Financial Reporting and the Corporations Regulations
2001.
A review of Half-year Consolidated Financial Statements consists of making
enquiries, primarily of persons responsible for financial and accounting
matters, and applying analytical and other review procedures. A review is
substantially less in scope than an audit conducted in accordance with
Australian Auditing Standards and consequently does not enable us to obtain
assurance that we would become aware of all significant matters that might be
identified in an audit. Accordingly, we do not express an audit opinion.
KPMG Jane Bailey
Partner
Perth
12 February 2026
Forward-looking statements
This release contains forward-looking statements, including statements about
trends in commodity prices and currency exchange rates; demand for
commodities; production forecasts; plans, strategies and objectives of
management; capital costs and scheduling; operating costs; anticipated
productive lives of projects, mines and operations; and provisions and
contingent liabilities. These forward-looking statements reflect expectations
at the date of this release, however they are not guarantees or predictions of
future performance. They involve known and unknown risks, uncertainties and
other factors, many of which are beyond our control, and which may cause
actual results to differ materially from those expressed in the statements
contained in this release. Readers are cautioned not to put undue reliance on
forward-looking statements. Except as required by applicable laws or
regulations, the South32 Group does not undertake to publicly update or review
any forward-looking statements, whether as a result of new information or
future events. Past performance cannot be relied on as a guide to future
performance. South32 cautions against reliance on any forward-looking
statements or guidance.
Non-IFRS financial information
This release includes certain non-IFRS financial measures, including
Underlying earnings, Underlying EBIT and Underlying EBITDA, Underlying
revenue, Underlying net finance costs, Underlying depreciation and
amortisation, Underlying operating costs, Underlying income tax expense,
Underlying royalty related tax expense, Basic Underlying earnings per share,
Underlying effective tax rate, Underlying EBIT margin, Underlying EBITDA
margin, Free cash flow, net cash/debt, net operating assets and ROIC. These
measures are used internally by management to assess the performance of our
business, make decisions on the allocation of our resources and assess
operational management. Non-IFRS measures have not been subject to audit or
review and should not be considered as an indication of or alternative to an
IFRS measure of profitability, financial performance or liquidity.
No offer of securities
Nothing in this release should be read or understood as an offer or
recommendation to buy or sell South32 securities, or be treated or relied upon
as a recommendation or advice by South32.
No financial or investment advice - South Africa
South32 does not provide any financial or investment 'advice' as that term is
defined in the South African Financial Advisory and Intermediary Services Act,
37 of 2002, and we strongly recommend that you seek professional advice.
FURTHER INFORMATION
Investor relations Media relations
Ben Baker Jamie Macdonald
M +61 403 763 086
M +61 408 925 140
E Ben.Baker@south32.net E Jamie.Macdonald@south32.net
Further information on South32 can be found at www.south32.net
(http://www.south32.net) .
South32 Limited (ABN 84 093 732 597)
Registered in Australia
(Incorporated in Australia under the Corporations Act 2001)
Registered Office: Level 2, 100 St Georges Terrace
Perth Western Australia 6000 Australia
ISIN: AU000000S320
Approved for release by Graham Kerr, Chief Executive Officer
JSE Sponsor: The Standard Bank of South Africa Limited
12 February 2026
1 (#_ftnref1) Members are equity holders of South32 Limited. Amounts
reported as attributable to members are stated net of amounts attributable to
non-controlling interests.
2 (#_ftnref2) Refer to market release "Completion of Illawarra Metallurgical
Coal Sale" dated 29 August 2024.
3 (#_ftnref3) Refer to market release "Completion of Cerro Matoso
Divestment" dated 1 December 2025.
4 (#_ftnref4) Net tangible assets as at 31 December 2025 includes all
right-of-use assets and lease liabilities, in accordance with AASB 16 Leases.
5 (#_ftnref5) On 29 August 2024, South32 sold its shareholding in Illawarra
Metallurgical Coal to an entity owned by Golden Energy and Resources Pte Ltd
and M Resources Pty Ltd. As a result, Illawarra Metallurgical Coal was
classified as a discontinued operation in the H1 FY26 and H1 FY25 results.
6 (#_ftnref6) On 1 December 2025, South32 sold its shareholding in Cerro
Matoso to an entity owned by CoreX Holding B.V. As a result, Cerro Matoso was
classified as a discontinued operation in the H1 FY26 and H1 FY25 restated
results.
7 (#_ftnref7) Members are equity holders of South32 Limited. Amounts
reported as attributable to members are stated net of amounts attributable to
non-controlling interests.
8 (#_ftnref8) Basic earnings per share is calculated as profit/(loss) after
tax attributable to members divided by the weighted average number of shares
for the period. Basic Underlying earnings per share is calculated as
Underlying earnings attributable to members divided by the weighted average
number of shares for the period. The weighted average number of shares for H1
FY26 is 4,491 million (H1 FY25: 4,515 million).
9 (#_ftnref9) H1 FY26 ordinary dividends per share is calculated as H1 FY26
ordinary dividend announced (US$175M) divided by the number of shares on issue
at 31 December 2025 (4,486 million).
10 (#_ftnref10) The underlying information reflects the Group's interest in
material equity accounted joint ventures and is presented on a proportional
consolidation basis. Our Group underlying financial measures reflect
continuing and discontinued operations. Financial measures listed in this
table and subsequently repeated throughout our Financial Results and Outlook
Half Year Ended 31 December 2025 are defined in the Glossary of terms and
abbreviations on page 28.
11 (#_ftnref11) Health and safety, and inclusion and diversity metrics
listed on this page are defined in the Glossary of terms and abbreviations on
page 28.
12 (#_ftnref12) Production guidance for Hillside Aluminium and Mozal
Aluminium does not assume any load-shedding impact on production.
13 (#_ftnref13) Refer to market release "Mozal Aluminium Update" dated 16
December 2025.
14 (#_ftnref14) Payable copper equivalent production (kt) was calculated by
aggregating revenues from copper, molybdenum, gold and silver, and dividing
the total Revenue by the price of copper. FY25 realised prices for copper
(US$4.18/lb), molybdenum (US$21.12/lb), gold (US$2,877/oz) and silver
(US$31.7/oz) have been used for H1 FY26, FY26e and FY27e.
15 (#_ftnref15) The information in this announcement that relates to the
Exploration Target for the Catabela Northeast prospect was declared as part of
South32's "2026 Half Year Financial Results" presentation (www.south32.net)
dated 12 February 2026 and prepared by Competent Persons in accordance with
the requirements of the JORC Code. South32 confirms that it is not aware of
any new information or data that materially affects the information included
in the original market announcement. South32 confirms that the form and
context in which the Competent Persons findings are presented have not been
materially modified from the original market announcement.
16 (#_ftnref16) Payable zinc equivalent (kt) was calculated by aggregating
revenues from payable silver, lead and zinc, and dividing the total Revenue by
the price of zinc. FY25 realised prices for zinc (US$2,648/t), lead
(US$1,883/t) and silver (US$31.9/oz) have been used for H1 FY26, FY26e and
FY27e.
17 (#_ftnref17) The information in this announcement that relates to Ore
Reserve and/or Mineral Resource estimates for Cannington was declared as part
of South32's "2026 Half Year Financial Results" presentation (www.south32.net)
dated 12 February 2026 and prepared by Competent Persons in accordance with
the requirements of the JORC Code. South32 confirms that it is not aware of
any new information or data that materially affects the information included
in the original market announcement. All material assumptions and technical
parameters underpinning the estimates in the relevant market announcement
continue to apply and have not materially changed. South32 confirms that the
form and context in which the Competent Persons findings are presented have
not been materially modified from the original market announcement.
18 (#_ftnref18) Hermosa growth capital expenditure excludes lease payments
of US$24M for self generated power assets directly attributable to
construction of infrastructure at the Taylor deposit. These self generated
power costs were included in our capital cost estimate provided in market
release "Final Investment Approval to Develop Hermosa's Taylor Deposit" dated
15 February 2024.
19 (#_ftnref19) Hermosa growth capital expenditure guidance excludes
expected lease payments of ~US$50M for self generated power assets directly
attributable to construction of infrastructure at the Taylor deposit. These
self generated power costs were included in our capital cost estimate provided
in market release "Final Investment Approval to Develop Hermosa's Taylor
Deposit" dated 15 February 2024.
20 (#_ftnref20) The information in this announcement that relates to the
exploration results for the Peake deposit is extracted from the market
announcement "2026 Half Year Financial Results" presentation (www.south32.net)
dated 12 February 2026. The information was prepared by R Wilson, Competent
Person, in accordance with the requirements of the JORC Code. South32 confirms
that it is not aware of any new information or data that materially affects
the information included in the original market announcement. South32 confirms
that the form and context in which the Competent Person's findings are
presented have not been materially changed from the original market
announcement.
21 (#_ftnref21) Refer to market release "Completion of Cerro Matoso
Divestment" dated 1 December 2025.
22 (#_ftnref22) Net distributions from our material EAIs (manganese and
Sierra Gorda) includes dividends, capital contributions and net
repayments/drawdowns of shareholder loans, which should not be considered as
an indication of or alternative to an IFRS measure of profitability, financial
performance or liquidity. H1 FY26 net distributions from our material EAIs
comprise a distribution (+US$180M) from Sierra Gorda and a net distribution
from Australia Manganese (+US$60M). The distribution from Sierra Gorda
(US$180M) relates to accrued interest.
23 (#_ftnref23) We returned US$35M via the on-market share buy-back in H1
FY26, purchasing 17M shares at an average price of A$3.08 per share.
24 (#_ftnref24) Since inception of our capital management program, US$1.8B
has been allocated to our on-market share buy-back (837M shares at an average
price of A$3.06 per share) and US$525M returned in the form of special
dividends.
25 (#_ftnref25) Our Group underlying financial measures reflect continuing
and discontinued operations.
26 (#_ftnref26) Refer to market release "Mozal Aluminium Update" dated 16
December 2025.
27 (#_ftnref27) The underlying information reflects the Group's interest in
material equity accounted joint ventures and is presented on a proportional
consolidation basis, which is the measure used by the Group's management to
assess its performance. The joint venture adjustments reconcile the
proportional consolidation to the equity accounting position included in the
Group's consolidated financial statements.
28 (#_ftnref28) Applicable for five years from the date of completion of the
sale of IMC, with no annual cap. The first two years will be calculated and
paid on the second anniversary of completion and annually thereafter. The
contingent price-linked consideration will be calculated as 50% of incremental
metallurgical coal revenue from equity production, net of royalties, based on
the following metallurgical coal price thresholds: Year 1: US$200/t, Year 2:
US$200/t, Year 3: US$190/t, Year 4: US$180/t, Year 5: US$180/t.
29 (#_ftnref29) Under the sale agreement, contingent price-linked
consideration of up to US$500M, was payable at threshold copper production
rates and prices for years 2022 to 2025. Specifically, 50% of incremental
revenue realised above the following copper price threshold, only where
payable copper production exceeds the agreed threshold: CY25: US$3.80/lb and
158kt Cu. The production threshold was not achieved in CY25. As a result, no
amount is payable for CY25 and the contingent consideration payable was
written down to nil in H1 FY26 (FY25: US$55M).
30 (#_ftnref30) Sales price variance reflects the revenue impact of changes
in commodity prices, based on the current period's sales volume. Price-linked
costs variance reflects the change in royalties together with the change in
input costs driven by changes in commodity prices or market traded
consumables. Foreign exchange reflects the impact of exchange rate movements
on local currency denominated costs and sales. Sales volume variance reflects
the revenue impact of sales volume changes, based on the comparative period's
sales prices. Controllable costs variance represents the impact from changes
in the Group's controllable local currency cost base, including the variable
cost impact of production volume changes on expenditure, and period-on-period
movements in inventories. The controllable cost variance excludes earnings
adjustments including significant items.
31 (#_ftnref31) Underlying net finance costs, Underlying income tax expense
(includes Underlying royalty related tax expense) and amounts attributable to
non-controlling interests are actual H1 FY26 results, not half-on-half
variances.
32 (#_ftnref32) The underlying information reflects the Group's interest in
material equity accounted joint ventures and is presented on a proportional
consolidation basis, which is the measure used by the Group's management to
assess its performance. The joint venture adjustments reconcile the
proportional consolidation to the equity accounting position included in the
Group's consolidated financial statements.
33 (#_ftnref33) The corporate tax rates applicable to the countries where
the Group operates include: Australia 30%, South Africa 27%, Colombia 35%,
Mozambique 0%, Brazil 34% and Chile 27%.
34 (#_ftnref34) Australia Manganese is subject to a royalty related tax
equal to 20% of adjusted EBIT. Sierra Gorda is subject to a royalty related
tax based on the amount of copper sold and the mining operating margin, the
rate is between 5% and 14% for annual sales over 50kt of refined copper. These
royalties are included in Underlying royalty related tax expense.
35 (#_ftnref35) Net distributions from our material EAIs (manganese and
Sierra Gorda) includes dividends, capital contributions and net
repayments/drawdowns of shareholder loans, which should not be considered as
an indication of or alternative to an IFRS measure of profitability, financial
performance or liquidity. H1 FY26 net distributions from our material EAIs
comprise a distribution (+US$180M) from Sierra Gorda and a net distribution
from Australia Manganese (+US$60M). The distribution from Sierra Gorda
(US$180M) relates to accrued interest.
36 (#_ftnref36) Net interest paid excludes amounts reported as net
distributions from material EAIs.
37 (#_ftnref37) Total capital expenditure comprises capital expenditure,
capitalised exploration and the purchase of intangibles. Capital expenditure
comprises safe and reliable capital expenditure, improvement and life
extension capital expenditure (including decarbonisation), and growth capital
expenditure.
38 (#_ftnref38) Hermosa growth capital expenditure excludes lease payments
of US$24M for self generated power assets directly attributable to
construction of infrastructure at the Taylor deposit. These self generated
power costs were included in our capital cost estimate provided in market
release "Final Investment Approval to Develop Hermosa's Taylor Deposit" dated
15 February 2024.
39 (#_ftnref39) Since inception of our capital management program, US$1.8B
has been allocated to our on-market share buy-back (837M shares at an average
price of A$3.06 per share) and US$525M returned in the form of special
dividends.
40 (#_ftnref40) Production guidance for Hillside Aluminium and Mozal
Aluminium does not assume any load-shedding impact on production.
41 (#_ftnref41) Payable copper equivalent production (kt) was calculated by
aggregating revenues from payable copper, molybdenum, gold and silver, and
dividing the total Revenue by the price of copper. FY25 realised prices for
copper (US$4.18/lb), molybdenum (US$21.12/lb), gold (US$2,877/oz) and silver
(US$31.7/oz) have been used for H1 FY26, FY26e and FY27e.
42 (#_ftnref42) Payable zinc equivalent production (kt) was calculated by
aggregating revenues from payable silver, lead and zinc, and dividing the
total Revenue by the price of zinc. FY25 realised prices for zinc
(US$2,648/t), lead (US$1,883/t) and silver (US$31.9/oz) have been used for H1
FY26, FY26e and FY27e.
43 (#_ftnref43) Operating unit cost is Underlying revenue less Underlying
EBITDA, excluding third party products and services, divided by sales volumes.
Operating cost is Underlying revenue less Underlying EBITDA excluding third
party products and services. Additional manganese disclosures are included in
footnotes 63 and 67 on pages 26 and 27.
44 (#_ftnref44) FY26e prior Operating unit cost guidance includes royalties
(where appropriate), the influence of exchange rates, and includes various
assumptions for FY26, including: an alumina price of US$350/t; a manganese ore
price of US$4.40/dmtu for 44% manganese product; a nickel price of US$7.00/lb;
a silver price of US$36.0/oz; a lead price of US$2,000/t (gross of treatment
and refining charges); a zinc price of US$2,650/t (gross of treatment and
refining charges); a copper price of US$4.40/lb (gross of treatment and
refining charges); a molybdenum price of US$19.00/lb (gross of treatment and
refining charges); a gold price of US$3,300/oz; an AUD:USD exchange rate of
0.66; a USD:ZAR exchange rate of 18.20; a USD:COP exchange rate of 4,250;
USD:CLP exchange rate of 950; and a reference price for caustic soda; which
reflect forward markets as at August 2025 or our internal expectations.
45 (#_ftnref45) FY26e new Operating unit cost guidance includes royalties
(where appropriate), the influence of exchange rates, and includes various
assumptions for FY26, including: an alumina price of US$340/t; a manganese ore
price of US$4.40/dmtu for 44% manganese product; a silver price of US$47.0/oz;
a lead price of US$2,000/t (gross of treatment and refining charges); a zinc
price of US$2,980/t (gross of treatment and refining charges); a copper price
of US$4.80/lb (gross of treatment and refining charges); a molybdenum price of
US$22.00/lb (gross of treatment and refining charges); a gold price of
US$3,900/oz; an AUD:USD exchange rate of 0.66; a USD:ZAR exchange rate of
17.50; a USD:COP exchange rate of 3,940; USD:CLP exchange rate of 950; and a
reference price for caustic soda; which reflect forward markets as at February
2026 or our internal expectations.
46 (#_ftnref46) Hermosa growth capital expenditure guidance excludes
expected lease payments of ~US$50M for self generated power assets directly
attributable to construction of infrastructure at the Taylor deposit. These
self generated power costs were included in our capital cost estimate provided
in market release "Final Investment Approval to Develop Hermosa's Taylor
Deposit" dated 15 February 2024.
47 (#_ftnref47) Guidance for Mozal Aluminium reflects the period ending
March 2026.
48 (#_ftnref48) Reflects five months of ownership prior to the divestment of
Cerro Matoso on 1 December 2025.
49 (#_ftnref49) H1 FY26 Underlying revenue on third party products and
services sold from continuing operations comprises US$36M for aluminium,
US$16M for manganese, US$44M for freight services and US$40M for raw
materials. H1 FY26 Underlying EBIT on third party products and services sold
from continuing operations comprises US$3M for aluminium, US$4M for alumina,
US$(2)M for freight services and US$1M for raw materials. H1 FY25 Underlying
revenue on third party products and services sold from continuing operations
comprises US$87M for aluminium, US$6M for alumina, US$19M for manganese,
US$26M for freight services and US$52M for raw materials. H1 FY25 Underlying
EBIT on third party products and services sold from continuing operations
comprises US$2M for aluminium, US$10M for alumina and US$(2)M for freight
services.
50 (#_ftnref50) H1 FY25 underlying results for IMC include third party
products and services. H1 FY25 Underlying revenue on third party products and
services sold was US$28M and Underlying EBIT on third party products and
services sold was nil.
51 (#_ftnref51) Refer to market release "Worsley Mine Development Project
Receives Federal Approval" dated 12 February 2025.
52 (#_ftnref52) Subject to receipt of any necessary secondary approvals. The
information in this announcement that refers to Production Target and forecast
financial information for Worsley Alumina is based on Proved (87%) and
Probable (13%) Ore Reserves. The Ore Reserves underpinning the Production
Target have been prepared by G Burnham and reported in accordance with the
requirements of the JORC Code and is available to view in South32's 2025
Annual Report (www.south32.net) published on 28 August 2025. South32 confirms
that all material assumptions underpinning the Production Target and forecast
financial information derived from the Production Target continue to apply and
have not materially changed.
53 (#_ftnref53) Production guidance for Hillside Aluminium does not assume
any load-shedding impact on production.
54 (#_ftnref54) Refers to substantially lower levels of GHG emissions when
compared to the current state. Where used in relation to South32's products or
portfolio, it refers to enhancement of existing methods, practices and
technologies to substantially lower the level of embodied GHG emissions as
compared to the current state.
55 (#_ftnref55) Refer to market release "Mozal Aluminium Update" dated 16
December 2025.
56 (#_ftnref56) Production guidance for Mozal Aluminium does not assume any
load-shedding impact on production.
57 (#_ftnref57) Payable copper equivalent production (kt) was calculated by
aggregating revenues from copper, molybdenum, gold and silver, and dividing
the total Revenue by the price of copper. FY25 realised prices for copper
(US$4.18/lb), molybdenum (US$21.12/lb), gold (US$2,877/oz) and silver
(US$31.7/oz) have been used for H1 FY25, H1 FY26, FY26e and FY27e.
58 (#_ftnref58) Sierra Gorda Operating unit cost is Underlying revenue less
Underlying EBITDA divided by ore processed. Periodic movements in finished
product inventory may impact Operating unit costs.
59 (#_ftnref59) Payable zinc equivalent (kt) was calculated by aggregating
revenues from payable zinc, lead and silver, and dividing the total Revenue by
the price of zinc. FY25 realised prices for zinc (US$2,648/t), lead
(US$1,883/t) and silver (US$31.9/oz) have been used for H1 FY25, H1 FY26,
FY26e and FY27e.
60 (#_ftnref60) The information in this announcement that relates to Ore
Reserve and/or Mineral Resource estimates for Cannington was declared as part
of South32's "2026 Half Year Financial Results" presentation (www.south32.net)
dated 12 February 2026 and prepared by Competent Persons in accordance with
the requirements of the JORC Code. South32 confirms that it is not aware of
any new information or data that materially affects the information included
in the original market announcement. All material assumptions and technical
parameters underpinning the estimates in the relevant market announcement
continue to apply and have not materially changed. South32 confirms that the
form and context in which the Competent Persons findings are presented have
not been materially modified from the original market announcement.
61 (#_ftnref61) Cannington Operating unit cost is Underlying revenue less
Underlying EBITDA divided by ore processed. Periodic movements in finished
product inventory may impact Operating unit costs.
62 (#_ftnref62) Realised ore prices are calculated as external sales
Underlying revenue less freight and marketing costs, divided by external sales
volume.
63 (#_ftnref63) H1 FY26 average manganese content of external ore sales was
41.4% on a dry basis. 100% of H1 FY26 external manganese ore sales were
completed on a CIF basis. H1 FY26 realised FOB ore prices and Operating unit
costs have been adjusted for freight and marketing costs of US$32M, consistent
with our FOB cost guidance. No ore sales in H1 FY25.
64 (#_ftnref64) FOB Ore Operating unit cost is Underlying revenue less
Underlying EBITDA, freight and marketing costs, divided by ore sales volumes.
65 (#_ftnref65) Refer to media release "Completion of Metalloys Manganese
Alloy Smelter Divestment" dated 3 June 2025.
66 (#_ftnref66) Realised ore prices are calculated as external sales
Underlying revenue less freight and marketing costs, divided by external sales
volume.
67 (#_ftnref67) H1 FY26 average manganese content of external ore sales was
38.3% on a dry basis (H1 FY25: 39.0%). 95% of H1 FY26 external manganese ore
sales (H1 FY25: 89%) were completed on a CIF basis. H1 FY26 realised FOB ore
prices and Operating unit costs have been adjusted for freight and marketing
costs of US$28M (H1 FY25: US$30M), consistent with our FOB cost guidance.
68 (#_ftnref68) FOB Ore Operating unit cost is Underlying revenue less
Underlying EBITDA, freight and marketing costs, divided by ore sales volumes.
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