Slide 1: 2024 Full Year Financial Results
2024 FULL YEAR FINANCIAL RESULTS 29 August 2024
Slide 2: Important Notices
IMPORTANT NOTICES This presentation should be read in conjunction with the “Financial Results and Outlook – full year ended 30 June 2024” announcement released on 29 August 2024, which is available on South32’s website (www.south32.net). FORWARD-LOOKING STATEMENTS This presentation contains forward-
Slide 3: Important Notices
IMPORTANT NOTICES The Group reported a loss after tax attributable to members of US$203M in FY24, with impairment expenses for Worsley Alumina (US$388M post-tax) and Cerro Matoso (US$248M post-tax), partially offset by an impairment reversal at Illawarra Metallurgical Coal (US$139M post-tax). Underl
Slide 4: FY24 Overview
FY24 OVERVIEW Delivered strong second half results and accelerated our portfolio transformation Delivered improved safety performance Lifted Underlying earnings and cash generation in H2 FY24 Allocated US$200M to our ongoing capital management program Approved final investment for Hermosa's Taylor z
Slide 5: Our Strategy
OUR STRATEGY Our purpose is underpinned by a simple strategy UNLOCK OPTIMISE the full value of our business IDENTIFY through our people, our business by working innovation, projects and and pursue opportunities to safely, minimising our impact, technology sustainably reshape our consistently deliver
Slide 6: Our FY24 Financial Performance
OUR FY24 FINANCIAL PERFORMANCE Our FY24 financial results reflected stronger Underlying earnings and cash generation to finish the year, supported by improved operating performance and prices for our key commodities in H2 FY24 Record production Net loss after tax Underlying EBITDA at two operations
Slide 7: Our Transformed Portfolio
OUR TRANSFORMED PORTFOLIO A simplified portfolio focused on commodities critical for a low-carbon future Illustrative FY24 Group Underlying revenue(a) FY24 Underlying EBITDA(c) US$1.05B 11% Aluminium value chain 25% • Optimising our leading, integrated positions in the aluminium value chain 8% • Gro
Slide 8: Our FY24 Safety Performance
OUR FY24 SAFETY PERFORMANCE Our safety guarantee(a) instils our belief that everyone at South32 can go home safe and well Fatalities10,11 Lost time injury frequency (LTIF)12 2 2.0 1.9 1.6 1 • Continued to implement our global, multi-year 0 Safety Improvement Program (b) FY22 FY23 FY24 FY22 FY23 FY24
Slide 9: Our FY24 Climate Change Performance
OUR FY24 CLIMATE CHANGE PERFORMANCE Progressed decarbonisation activities for our higher-emitting operations and continued to reshape our portfolio Scope 1 and 2 GHG emissions(b) (Mt CO2-e) Decarbonising our operations -6% -12% • Converted the first two coal-fired boilers at Worsley Alumina to natur
Slide 10: Financial Results
SOUTH32 mn NANCIAL ESULTS Be)
Slide 11: Performance Analysis
PERFORMANCE ANALYSIS Higher alumina and zinc margins more than offset by lower average commodity prices FY24 Underlying EBITDA contribution by commodity(a) Alumina Aluminium Copper operating margin operating margin operating margin6 55% Alumina 19% 52% 26% 43% Aluminium 34% Copper 31% 7% 28% Continu
Slide 12: Earnings Analysis
EARNINGS ANALYSIS Lower raw material input prices and weaker FX more than offset by lower average commodity prices, the impact of planned longwall moves at IMC and Tropical Cyclone Megan at Australia Manganese Sales price by commodity (US$M) Sales volume by commodity (US$M) Copper, zinc and nickel (
Slide 13: Cost Analysis
COST ANALYSIS Disciplined cost management and lower raw material input prices supported a reduction in our total cost base17 Decrease in market traded consumables and price-linked costs (US$M) Increase in controllable costs, largely related to a drawdown of inventory (US$M) FY24 expenditure for mark
Slide 14: Cash Flow Analysis
(US$M) FY23 net debt (483) Free cash flow from operations excluding capital expenditure 1,000 Net distributions H1: US$107M H2: US$893M 53 from EAIs Safe and reliable and CASH FLOW ANALYSIS Improvement and life extension (670) capital expenditure Growth capital IMC: US$340M expenditure (372) Intangi
Slide 15: Balance Sheet
BALANCE SHEET Sale of IMC will enhance our balance sheet strength and flexibility June 2024 net cash/(debt) (US$M) 1,010 248 (140) Net debt reduced by US$329M in H2 FY24 (200) (92) Pro-forma net cash position ~US$250M following sale of IMC(a) Continue to maintain a strong balance sheet following ret
Slide 16: Capital Management Framework
CAPITAL MANAGEMENT FRAMEWORK Our capital management Expanded our capital management On-market share buy-back to framework is unchanged program by US$200M to US$2.5B commence following the sale of IMC Capital management framework Capital allocation since FY16(a) Shareholder returns(b) (US$M) (US$M) R
Slide 17: Outlook
SOUTH32 OUTLOOK
Slide 18: Production Guidance
PRODUCTION GUIDANCE Alumina (kt) Aluminium (kt) Copper equivalent25 (kt) Constrained bauxite supply at Worsley Alumina; Low-carbon aluminium5 growth of Continued benefit of plant de-bottlenecking improved plant availability at Brazil Alumina 17% in FY25 and 8% in FY26 and higher planned copper grade
Slide 19: Capital Expenditure Guidance
CAPITAL EXPENDITURE GUIDANCE Investing to grow our base metals production with lower sustaining capital expenditure following the sale of IMC Capital expenditure(a) Base metals(b) capital expenditure (US$M per annum) (% of total Group) Final investment ~85% of capital expenditure to be 1,600 approva
Slide 20: Australia Manganese Update
AUSTRALIA MANGANESE UPDATE Delivering a safe return to operations following the severe impacts of Tropical Cyclone Megan Flooded pit following Tropical Cyclone Megan Operational recovery plan • Dewatering targeted mining pits and commenced a phased return to mining activities • Activity to increase
Slide 21: Worsley Alumina Update
WORSLEY ALUMINA UPDATE Securing our next bauxite mining areas and continuing to meet the State's robust environmental standards Bauxite mining areas Worsley Mine Development Project N • Unlocking additional high-quality bauxite which is expected to sustain production to at least ~FY36(a) • Commenced
Slide 22: Alumina Market
ALUMINA MARKET Chinese bauxite supply challenges, and ex-China Future builds are expected from outside of China due to declining refinery curtailments driven by energy, environmental Chinese bauxite self-sufficiency and environmental policies and logistics constraints, have tightened the market Alum
Slide 23: Aluminium Market
ALUMINIUM MARKET Global demand (predominantly With China’s smelting capacity expected Attractive long-term price outlook driven by China) grew ~3.5% in H2 FY24, to be capped at 45Mt, rest of world supported by global energy transition and supporting prices through the period investment is required t
Slide 24: Copper Market
COPPER MARKET Strong long-term primary demand outlook The concentrate market remained tight despite a recovery in requiring new mine supply despite scrap recycling exchange inventories, supporting prices during FY24 and potential substitution towards aluminium Global copper price and inventories(a)
Slide 25: Zinc Market
ZINC MARKET Global supply has been constrained by a lack of new discoveries, Primary demand growth expected to outpace production by falling grades and rising environmental regulations in China, ~3Mt to 2032, an industry challenge similar in magnitude to copper factors that will continue to impact t
Slide 26: Portfolio and Growth
SOUTH32 PO RTFOLIO AN D GROWTH
Slide 27: Our Portfolio
OUR PORTFOLIO An attractive commodity mix and growth pipeline in commodities critical for a low-carbon future Cerro Matoso Australia Manganese Ambler Metals JV MRN Bauxite Cannington Brazil Alumina Worsley Alumina Sierra Gorda Mozal Aluminium Hermosa Brazil Aluminium South Africa Manganese Hillside
Slide 28: Our Growth Pipeline
OUR GROWTH PIPELINE Advancing our high-quality development projects and pipeline of growth options in base metals ~15%(a) CuEq growth in zinc and copper Deep pipeline of projects in study and exploration phase Copper equivalent production27 (kt) Hermosa's Clark deposit battery-grade manganese potent
Slide 29: Sierra Gorda Copper
SIERRA GORDA COPPER Unlocking value and growing future copper volumes at Sierra Gorda Large scale, long life copper mine with Lifting processing capacity Higher planned copper grades in remaining operating life of 24 years(a) through capital efficient projects the next phase of the mine plan Ore pro
Slide 30: Our Hermosa Project
OUR HERMOSA PROJECT A regional scale project with the potential to produce critical commodities across multiple deposits for decades, underpinned by Taylor as the first development stage • Final investment approval for Taylor's development underpinned by Taylor deposit attractive returns over an ini
Slide 31: Our Taylor Deposit
OUR TAYLOR DEPOSIT Development progressing to plan with construction of the shafts and surface facilities to commence in FY25 FY24 milestones FY25 priorities • Completed dewatering program which covers both Taylor and Clark • Progress construction of the main and ventilation shafts • Received all st
Slide 32: Hermosa Near Mine Exploration Potential
HERMOSA NEAR MINE EXPLORATION POTENTIAL Additional drill results support the potential for a continuous copper system connecting Peake and Taylor Peake deposit (looking east) Clark deposit Shafts (in progress) • Recent drilling at Peake has returned further high-grade copper results(a) • Further exp
Slide 33: Our Future Growth Through Discovery
OUR FUTURE GROWTH THROUGH DISCOVERY Progressing a pipeline of exploration prospects in targeted regions as we work to discover our next generation of base metals mines (a) Our strategy has generated 25+ exploration prospects across Expect to spend US$70M in FY25e to prospective base metals options o
Slide 34: Our Exploration Portfolio in Argentina
OUR EXPLORATION PORTFOLIO IN ARGENTINA We have consolidated our position in the San Juan region in Argentina, establishing a low-cost entry to an emerging copper district with substantial exploration upside Porphyry copper belts system Sierra Gorda (45%) We have established attractive exploration po
Slide 35: Summary
SOUTH32 SUMMARY
Slide 36: Summary
SUMMARY We continue to execute our strategy and reshape our portfolio for a low-carbon future Focused on consistent operating performance and disciplined cost management Delivering near-term volume growth in copper and low-carbon aluminium5 Increasing future base metals volumes through high-quality
Slide 37: Supplementary Information
— W= — SOUTH3: SUPPLEMENTARY INFORMATION iy
Slide 38: Earnings Sensitivities
EARNINGS SENSITIVITIES EBIT sensitivity(a) +/- 10% Commodity US$M Aluminium(b) 292 (b) Alumina 181 Copper(c) 67 Nickel 42 Manganese ore 35 Silver 29 Lead 21 Zinc 11 Australian dollar 139 South African rand 130 Brazilian real 35 Colombian peso 33 Chilean peso 17 Notes: a. The sensitivities reflect th
Slide 39: Aluminium Smelter Operating Unit Costs
ALUMINIUM SMELTER OPERATING UNIT COSTS Hillside Aluminium Mozal Aluminium Brazil Aluminium (US$/t) (US$/t) (US$/t) Operating unit costs to benefit from Operating unit costs to benefit from Continuing to test nameplate capacity 15% planned production growth in FY25 25% planned production growth in FY
Slide 40: Operating Unit Costs Guidance
OPERATING UNIT COSTS GUIDANCE H2 FY24 FY24 FY25 FY25 guidance vs. FY24 actual Operating unit costs Commentary actual actual guidance29 (10%) (5%) 0% 5% 10% 15% 20% Worsley Alumina Constrained bauxite supply, higher caustic soda prices 280 269 290 (US$/t) and price-linked royalties Brazil Alumina (no
Slide 41: Closure & Rehabilitation Provisions
CLOSURE & REHABILITATION PROVISIONS Closure and rehabilitation FY24 FY23 South32 Group provisions by operation (South32 share, excluding EAIs) US$M US$M Profit and loss impact Balance sheet (+US$144M) (+US$25M)35 Worsley Alumina 976 924 136 11 (3) 25 Brazil Alumina (non-operated) 98 75 Americas Amer
Slide 42: Capital Expenditure Guidance
CAPITAL EXPENDITURE GUIDANCE FY24 FY25e Capital expenditure excluding exploration and intangibles (South32 share) US$M US$M Worsley Alumina 69 90 Brazil Alumina 58 60 Brazil Aluminium 8 10 Hillside Aluminium 38 60 Mozal Aluminium 22 25 Cannington 37 45 Cerro Matoso 34 20 Illawarra Metallurgical Coal
Slide 43: Footnotes
FOOTNOTES 1. Refers to Underlying earnings attributable to members. Members are equity holders of South32 Limited. Amounts reported as attributable to members are stated net of amounts attributable to non-controlling interests. 2. Refer to market release "Final Investment Approval to Develop Hermosa
Slide 44: Footnotes
FOOTNOTES 25. 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. FY24 realised prices for copper (US$3.86/lb), molybdenum (US$20.60/lb), gold (US$2,129/oz) and silver (US$24
Slide 45: South32
SOUTH32
Slide 46: Annexure 1: JORC Code Table 1: Peake Deposit
Annexure 1: JORC Code Table 1: Peake Deposit The following tables provide a summary of important assessment and reporting criteria used for the reporting of Exploration Results for the Peake deposit, which forms part of the Hermosa Project located in South Arizona, USA (Figure 1). Sections 1 and 2 b
Slide 47: JORC Table 1: Logging and Sub-sampling
Criteria Commentary Logging • The entire length of core is photographed and logged for lithology, alteration, structure, rock quality designation (RQD) and mineralisation. • Logging is both quantitative and qualitative, of which there are several examples including estimation of mineralisation perce
Slide 48: JORC Table 1: Sample Analysis and Verification
Criteria Commentary CRM fails, data reviewers internal to ALS examine the location of the failure in the batch and determine how many samples around the failure should be re-analysed. If both CRMs fail, the entire batch is re-analysed. No material failures have been observed from the data. • Coarse
Slide 49: JORC Table 1: Sample Security and Audits
Criteria Commentary conducted through contracted transport. Distribution to other preparation facilities and Vancouver is managed by ALS dedicated transport. • Assays are reconciled and results are processed in a secure database (acQuire) which has password and user level security. • Core is stored
Slide 50: JORC Table 1: Mineral Tenement and Land Tenure
Section 2 Reporting of Exploration Results (Criteria listed in the preceding section also apply to this section.) Criteria Commentary Mineral • The Hermosa Project mineral tenure (Figure 1) is secured by 30 patented mining claims, tenement and totalling 228 hectares that have full surface and minera
Slide 51: JORC Table 1: Exploration Results Reporting
Criteria Commentary • A drill hole plan view (Figure 3) provides a summary of drilling collar locations that support the Peake deposit exploration results and surface geology. Figure 4 provides the Peake deposit exploration drill holes relative to the mineralisation domains. Figure 5 provides the dr
Slide 52: JORC Table 1: Further Work
Criteria Commentary • Quality control of geophysical data includes using a third-party geophysical consultant to verify data quality and provide secondary inversions for comparison to Quantec interpretations. Further work • Planned elements of the exploration strategy include extensional and infill
Slide 53: Figure 1: Regional Location Plan
Figure 1: Regional location plan 2024 FULL YEAR FINANCIAL RESULTS – PEAKE EXPLORATION RESULTS
Slide 54: Figure 2: Hermosa Project Regional Geology
Figure 2: Hermosa project regional geology 2024 FULL YEAR FINANCIAL RESULTS – PEAKE EXPLORATION RESULTS
Slide 55: Figure 3: Peake Deposit Local Geology and Collar Locations
Figure 3: Peake deposit local geology and Exploration Results collar locations 2024 FULL YEAR FINANCIAL RESULTS – PEAKE EXPLORATION RESULTS
Slide 56: Figures 4 and 5: Mineralisation Domains and Cross-section
Figure 4: Plan view of the Taylor, Clark, Peake Mineralisation Domains, and approximate shaft locations with previously reported and new exploration drill holes. Figure 5: Cross-section through the Taylor, Clark, and Peake mineralisation domains showing the new exploration holes, simplified geology,
Slide 57: Figure 6: Level Plan Map and Table 1 Drill Holes
Figure 6: Level plan map at 320m elevation showing Peake drillholes and mineral domains. Newly reported hole IDs are blue. Table 1: Hole ID, collar location, dip, azimuth, and drill depth of new drill holes from the Peake Deposit North Elevation Wedge TD Depth Hole ID East (UTM) Dip Azimuth (UTM) (m
Slide 58: Table 2: Significant Intersections – Peake Deposit
Table 2: Significant intersections – Peake Deposit Exploration Results From To Width Zinc Lead Silver Copper Molybdenum CuEq ZnEq Hole ID Cut Off (m) (m) (m) (%) (%) (g/t) (%) (%) (%) (%) 2% HDS-813-A 1352.2 1355.8 3.5 5.02 3.92 79 0.005 - - 8.69 ZnEq HDS-813-B Did not reach target depth. - HDS-813-