ANNUAL
REPORT
2024
Corporate
Governance
Statement
Modern Slavery
Statement
Sustainable
Development
Report
Tax Transparency
and Payments
to Governments
Report
SUSTAINABLE
DEVELOPMENT
REPORT
2024
Sustainability
Databook
Standards and
Frameworks
Reporting Index
SUSTAINABILITY
DATABOOK
2024
STANDARDS
AND FRAMEWORKS
REPORTING INDEX
2024
CORPORATE
GOVERNANCE
STATEMENT
2024
MODERN
SLAVERY
STATEMENT
2024
TAX TRANSPARENCY
AND PAYMENTS
TO GOVERNMENTS REPORT
2024
Annual Report FY24
This Annual Report is a summary of South32’s operations, activities
and performance for the year ended 30 June 2024 and its financial
position as at 30 June 2024. South32 Limited (ABN 84 093 732 597) is
the ultimate holding company of the South32 group of companies.
In this report, unless otherwise noted:
a) references to South32, the South32 Group, the Group, we, us, our
and similar expressions refer to South32 Limited, its subsidiaries
and operated joint ventures;
b) references to ‘our operations’, or commodities ‘we produce’ or in
‘our portfolio’ includes commodities such as bauxite, alumina,
aluminium and copper that may form part of, or be produced by
our non-operated joint ventures;
c) financial information outside of the Financial Report
(1)
is
presented based on the Group’s equity share in its subsidiaries
(2)
,
operated joint ventures
(3)
and non-operated joint ventures
(4)
; and
d) metrics describing health, safety, environment, people and
community related performance in this report are presented for
the Group’s subsidiaries and operated joint ventures
(5)
on a
100 per cent basis, as outlined in the “Reporting Boundaries”
section of our Sustainable Development Report 2024 available at
www.south32.net.
Monetary amounts in this report are expressed in US dollars unless
otherwise stated.
Non-IFRS
This report includes non-IFRS financial measures, including
underlying measures of earnings, effective tax rate, returns on
invested capital, cash flow and net cash/(debt).
Non-IFRS measures should not be considered as alternatives to an
IFRS measure of profitability, financial performance or liquidity. For
an explanation of how South32 uses non-IFRS measures, see page
39. The definitions of individual non-IFRS measures used in this
report are set out in the glossary on page 191.
(1) For Financial Report basis of preparation, refer to Note 2 to the financial statements (Basis of preparation) on page 151 of this report.
(2) Cerro Matoso SA financial information is presented on a 100 per cent basis.
(3) Note that Chita Valley financial information is presented on a 100 per cent basis.
(4) Note that financial information for Mineração Rio do Norte S.A (MRN) and Port Kembla Coal Terminal (PKCT) is excluded.
(5) Metrics in relation to Chita Valley are not included.
Forward-looking statements
While the forward-looking statements in this report reflect South32’s
expectations at the date of this report (including with respect to its
strategies and plans regarding climate change), they may be
affected by a range of variables which could cause actual outcomes
and developments to differ materially from those expressed in such
statements. These variables include but are not limited to: financial
and economic conditions in various countries; fluctuations in
demand, price, or currency; operating results; development
progress including approvals; risks, including physical, technology
and carbon emissions reductions risks; industry competition; loss of
market for South32’s products; legislative, fiscal, and regulatory
developments; the conduct of joint venture participants and
contractual counterparties, and estimates relating to cost,
engineering, reserves and resources. For further information
regarding South32’s approach to risk, see page 28.
South32 makes no representation, assurance or guarantee as to the
accuracy, completeness or likelihood of fulfilment of any forward-
looking statement, any outcomes expressed or implied in any
forward-looking statement or any assumptions on which a forward-
looking statement is based. Except as required by applicable laws or
regulations, South32 does not undertake to publicly update or
review any forward-looking statements. Past performance cannot
be relied on as a guide to future performance. South32 cautions
against undue reliance on any forward- looking statements or
guidance.
Annual Report 2024
This report is a summary of our operations, activities, performance and financial position as at 30 June 2024.
Our 2024 Annual Reporting Suite
Cover: A geochemist specialist at the Hermosa project in the United States.
Right: Anindilyakwa People on Groote Eylandt in Australia.
+ You can view all the documents in our Annual Reporting Suite at www.south32.net.
About this report
2
SOUTH 32 ANNUAL REPORT 2024
OPERATING AND FINANCIAL REVIEW
About this report IFC
From the Chair 2
Our purpose-led approach 4
Our business explained 6
About us 6
Performance highlights 7
Where we operate 8
Our business model 10
Our stakeholders and impact 12
Our commodities 14
From the CEO 16
Our strategy 18
Our strategy in action 20
Key performance indicators 26
Risk management 28
Financial and operational performance summary 39
GOVERNANCE
Governance at a glance 68
Board of Directors 70
Directors’ report 75
Lead Team 80
Remuneration report 82
Acknowledgement
We acknowledge and pay our respects to the
Indigenous, Traditional and Tribal Peoples of the
lands, waters and territories on which South32
is located and where we conduct our business
around the world.
We respect and acknowledge the unique cultural
and spiritual relationships that Indigenous,
Traditional and Tribal Peoples have to the lands,
waters and territories, and their rich contribution
to society.
In the spirit of respect and reconciliation, we will
continue to support initiatives that strengthen
culture and ways of life so that their legacy
continues and extends to future generations.
FINANCIAL REPORT
Consolidated income statement 110
Consolidated statement
of comprehensive income 111
Consolidated balance sheet 112
Consolidated cash flow statement 113
Consolidated statement of changes in equity 114
Notes to the financial statements 115
Directors' declaration 170
Lead auditor’s independence declaration 171
Independent auditor’s report 172
RESOURCES AND RESERVES
Information 178
Competent persons 179
Accompanying tables 180
INFORMATION
Shareholder information 188
Glossary of terms and abbreviations 191
Corporate directory 199
Contents
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
1
SOUTH 32 ANNUAL REPORT 2024
As our portfolio evolves, the common
commitment that unites us is that
everyone at South32 goes home safe and
well. As a result, we view our performance
for the year through the lens of safety.
In every part of our business, our people
have worked hard to deliver the Safety
Improvement Program and I am pleased
to report we are seeing positive trends in
our leading indicators, which are designed
to detect and provide advance warning of
latent safety hazards.
We continue to place emphasis on
developing safety leaders through our
LEAD Safely Every Day program and we
are extending the program to frontline
employees to involve and empower them
to drive safety improvements on the
ground. Consistent with the program’s aim
to form a common understanding of what
it means to be a safety leader at South32,
the Board has also completed this training.
Our approach to safety is supported by
a culture that promotes inclusion and
allows for collaboration, innovation and
performance. Delivering the cultural
transformation required for sustained
safety improvement demands focus
at all levels, from the Board to frontline
employees.
To see how our culture is experienced on
the ground, the Board visits a number
of our operations and offices each year.
In FY24 we visited Worsley Alumina,
Cannington, Australia Manganese, Mozal
Aluminium, our Singapore Marketing
office and our office in Johannesburg.
These visits also provided an opportunity
for Directors to hear from operational
employees on how they experience our
Safety Improvement Program in the field.
As part of the ongoing development of our
workplace culture, the Board participated
in Active Bystander training in FY24, a
new program that builds upon our Living
our Code training on acceptable and
unacceptable workplace behaviours.
It focuses on the important role of
bystanders in helping to reduce unsafe
and disrespectful behaviours, in an effort
to create a workplace where everyone
feels safe and can speak up.
We have continued our work overseeing
the development and implementation of
our strategy, with a key aspect being the
identification and pursuit of opportunities
to sustainably reshape our business for
the future.
Developing the Taylor zinc-lead-silver
deposit in the United States and divesting
Illawarra Metallurgical Coal are significant
portfolio decisions that align with our
purpose, positioning us to continue to
supply the commodities needed for the
global energy transition.
The development of the Taylor deposit
will increase the supply of zinc, a federally
designated critical mineral in the United
States and, as the largest private
investment in southern Arizona's history,
it is poised to make a major contribution
to the local economy and communities for
generations to come.
Longer term, we are excited by the
potential for Hermosa to produce
commodities including battery-grade
manganese and copper, in addition to zinc,
across multiple deposits, underpinned by
Taylor as the first development stage.
The sale of Illawarra Metallurgical Coal will
see the operation continue its contribution
to the local steel industry and the Illawarra
and Macarthur regions. For South32, it will
streamline our portfolio and unlock capital
to invest in our high-quality development
projects in base metals. Following
completion of the transaction, which is
expected on 29 August 2024, our exposure
to the aluminium value chain and base
metals will be approximately 90 per cent of
Underlying revenue, up from 50 per cent
when South32 was formed in 2015.
Despite weather and other operational
impacts on our business, we achieved
two annual production records in FY24
and delivered Underlying earnings of
US$380 million.
We reported a statutory loss after tax of
US$205 million, with impairment expenses
for Worsley Alumina and Cerro Matoso
partially offset by an impairment reversal
for Illawarra Metallurgical Coal.
PIVOTING
OUR PORTFOLIO
This year has been one of the most significant in South32’s history
as we accelerated the transformation of our portfolio to produce
commodities critical for a low-carbon future.
“
The portfolio changes we have announced align with
our purpose and position South32 to continue
supporting the global energy transition.”
From the Chair
2
SOUTH 32 ANNUAL REPORT 2024
We returned US$198 million to
shareholders during FY24, with
US$163 million in fully-franked ordinary
dividends and US$35 million via our
on-market share buy-back. In February
2024, we took the decision to cancel our
on-market share buy-back to manage
our financial position and retain the
right balance of flexibility, efficiency
and prudence. Reflecting the Group's
strengthened financial position and
our disciplined approach to capital
management, the Board has resolved to
allocate US$200 million to our ongoing
capital management program, to be
returned to shareholders via an on-
market share buy-back, commencing
from completion of the sale of Illawarra
Metallurgical Coal.
Our Board represents a broad cultural,
ethnic, background and geographic mix,
and in FY24 we achieved gender balance
among our Directors. In November 2023
we welcomed Sharon Warburton as an
independent Non-Executive Director,
further enhancing the Board’s broad range
of skills and experience.
In October we will farewell Keith Rumble
who is stepping down from the Board at
our 2024 Annual General Meeting. Keith
has been a Non-Executive Director since
2015 and was the inaugural Chair of our
Sustainability Committee, a role he held
until recently. During his tenure Keith
has made a very valuable contribution to
our Board and to the company, bringing
his deep operational skills and ensuring
sustainability considerations were
incorporated into our strategy during a
period of heightened stakeholder focus
on environmental and social performance.
I would like to take this opportunity to
thank Keith for his contribution to South32.
Our approach to sustainability has
continued to focus on five areas that
are material to our stakeholders, our
business and to our long-term future,
and are closely aligned to our purpose
and integrated with our strategy. The
most material of these is responding
to the imperative to address climate
change. We support the goals of the
Paris Agreement and have set a target
to halve our operational greenhouse gas
(GHG) emissions (Scope 1 and 2) by 2035
from our FY21 baseline. We also have a
long-term goal to achieve net zero GHG
emissions, inclusive of Scope 1, 2 and 3
emissions, by 2050.
We continue to make progress against
our first Climate Change Action Plan which
was published in 2022. The Plan focuses
on reshaping our portfolio, decarbonising
our operations, working with others on
shared challenges, and responding to
the potential physical impacts of climate
change, the latter being brought into
sharper focus in FY24 as severe weather
events impacted two of our operations.
As we consider our approach to climate
change going forward, we engage
extensively with shareholders and other
stakeholders and take their feedback into
account. We intend to publish our second
Climate Change Action Plan in 2025.
Together with climate change,
environment is a material strategic and
governance issue for South32. As stewards
of the lands and waters where we operate,
it is our responsibility to minimise our
impacts on the natural environment.
Our Board oversees our environmental
approach and performance, supported
by the Sustainability Committee. We are
developing our approach to addressing
nature-related risks and opportunities,
which we plan to publish in 2025.
Global markets will continue to be
impacted by geopolitical issues that
have resulted in disruptions and volatility
in trade flows and commodity supply
chains. Heightened tensions between
world superpowers have further
exacerbated policy uncertainties, with
trade barriers and strategic realignments
shaping the global economic landscape.
Elections in many countries have also
added unpredictability to the market
environment.
As a result, we are likely to see continued
volatility in the prices of our commodities.
We are focused on what we can control,
which is to remain disciplined in how we
allocate capital to protect our balance
sheet, while maintaining safe and reliable
operations and continuing to transform
our portfolio for long-term value creation.
As we look ahead to our 10th year and
beyond, we have much to be proud of
and much to look forward to as a global,
diversified producer of commodities
critical for a low-carbon future.
On behalf of the Board, I would like to
thank our people for their hard work
and dedication throughout the year,
as well as the communities where we
work, our shareholders and all our other
stakeholders for their ongoing support.
Karen Wood
Chair
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
3
SOUTH 32 ANNUAL REPORT 2024
Our strategy
Our purpose is underpinned by a simple strategy which is focused on optimising the performance of our
operations, unlocking their potential and identifying new opportunities to create value for our stakeholders.
Our purpose-led approach
MAKING
A DIFFERENCE...
Our purpose
Our purpose is to make a difference by developing natural resources, improving people’s lives now and for
generations to come. We are trusted by our owners and partners to realise the potential of their resources.
Our values
While our strategy outlines what we do to achieve our purpose, our values guide how we do it.
Every day, our values shape the way we behave and the standards we set for ourselves and others.
Our performance
Our key performance indicators provide a balanced approach to measuring our performance against the
delivery of our strategy, in support of our purpose and aligned with our values.
Sustainability is at the heart of our purpose and underpins the delivery of our strategy.
OPTIMISE UNLOCK IDENTIFY
+ Learn more about our values at www.south32.net.
+
Learn more in Our strategy
in action on pages 20 to 21.
+
Learn more in Our strategy in
action on pages 22 to 23.
+
Learn more in Our strategy in
action on pages 24 to 25.
+ Learn more about our key performance indicators on pages 26 to 27.
Care
We care about people,
the communities we’re
a part of and the world
we depend on.
Trust
We deliver on our
commitments and rely
on each other to do
the right thing.
Togetherness
We value difference and
we openly listen and share,
knowing that together
we are better.
Excellence
We are courageous
and challenge ourselves
to be the best in
what matters.
+ Learn more about our approach to sustainability in our Sustainable Development Report 2024 at www.south32.net.
4
SOUTH 32 ANNUAL REPORT 2024
...AND IMPROVING
PEOPLE’S LIVES
Our stakeholders
We are committed to creating value
for our stakeholders. We believe
that, when done sustainably, the
development of natural resources
can change people’s lives for the
better. In delivering our strategy, we
seek to create enduring social,
environmental and economic value,
in a way that aligns with our purpose
and values.
+
Learn more about how we are
creating brighter futures,
together on pages 12 to 13.
+
Learn more about our stakeholders
in our Sustainable Development
Report 2024 at www.south32.net.
Our people
Nothing is more important than the health, safety and wellbeing of our people. We are committed to working together
safely, creating a values-based culture and an inclusive and diverse workforce.
+
Learn more about how we are protecting and respecting our people in our Sustainable Development Report 2024
at www.south32.net.
Our people are fundamental to our success. We seek to attract, develop and retain talented people who have a shared
belief in our purpose and values. Our reward framework aims to reward business and individual performance, as well
as drive ownership behaviours
+ Learn more about executive reward in our Remuneration report on pages 82 to 108.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
5
SOUTH 32 ANNUAL REPORT 2024
SOUTH32 IS A GLOBALLY
DIVERSIFIED MINING
AND METALS COMPANY
We produce commodities including bauxite,
alumina, aluminium, copper, zinc, lead, silver, nickel,
manganese and metallurgical coal from our
operations in Australia, Southern Africa and South
America. We also have a portfolio of high-quality
development projects and options, and exploration
prospects, consistent with our strategy to reshape
our portfolio towards commodities critical for a
low-carbon future
(1)
.
Our business explained > About Us
Purpose-driven, dynamic and agile, we
empower our people to work safely and
collaboratively to make a positive impact
every day. By working with our partners
and communities, we build meaningful
relationships to create brighter futures,
together. From exploration to development,
operation to closure, we work to minimise
our impact on the environment and aspire
to leave a positive legacy.
Together we’re making a difference.
Now, and for future generations.
(1) In this report we use particular terminology in relation to climate change. Definitions of the terms 'goal', 'target' and 'low-carbon' when used in the context of climate change
are set out in the Glossary of terms and abbreviations on pages 191 to 198 of this report.
6
SOUTH 32 ANNUAL REPORT 2024
OUR PERFORMANCE
AT A GLANCE
Our business explained > Performance highlights
〉 No fatalities at our operations and
improved our total recordable
injury frequency.
〉 Improved operating performance,
disciplined cost management and
higher prices for our key
commodities lifted our financial
results to finish the year.
〉 Set consecutive annual
production records at Hillside
Aluminium and South Africa
Manganese, and lifted production
at Cannington by 10 per cent
year-on-year despite adverse
weather impacts.
〉 Announced final investment
approval to develop the Taylor
zinc-lead-silver deposit at our
Hermosa project
(5)
.
〉 Announced the sale of Illawarra
Metallurgical Coal, which is
expected to complete on
29 August 2024
(6)
.
〉 Operational greenhouse gas
(GHG) emissions (Scope 1 and 2)
decreased by six per cent and
value chain GHG emissions (Scope
3) decreased by 17 per cent
year-on-year.
(1) Copper equivalent production was calculated using FY23 realised prices.
(2) Fully-franked ordinary dividends paid in respect of H2 FY23 (US$145M), fully-franked ordinary dividends paid in respect of H1 FY24 (US$18M) and on-market share buy-back
(US$35M).
(3) Frequency rates are per million hours worked. Incidents are included where South32 controls the work location or controls the work activity.
(4) Includes Scope 1 and Scope 2 greenhouse gas emissions.
(5) For further information see page 23 of this report.
(6) For further information see page 25 of this report.
+
Learn more about our key performance indicators, including historical data,
on pages 26 to 27.
198
Shareholder returns
(US$ million)
(2)
(FY23 1,225)
1,802
Underlying EBITDA
(US$ million)
(FY23 2,534)
20.3
Operational greenhouse gas emissions
(Million tonnes CO
2
-e)
(4)
(FY23 21.7)
23.6
Social Investment
(US$ million)
(F Y23 27.7 )
1,118
Copper equivalent production
(kilotonnes)
(1)
(FY23 1,206)
1.9
Lost time injury frequency
(per million hours worked)
(3)
(FY23 1.6)
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
7
SOUTH 32 ANNUAL REPORT 2024
CERRO MATOSO
Nickel
AMBLER METALS
Copper, Lead, Gold, Silver and Zinc
HERMOSA
Zinc, Lead, Silver and Manganese
VANCOUVER
BRAZIL ALUMINA
Alumina
BRAZIL ALUMINIUM
Aluminium
BRAZIL ALUMINA
Bauxite
Development option
Development project
Non-operated operation
Greenfield exploration
South32-operated operation
Office
Aluminium value chain
Copper
Metallurgical coal
Nickel
Zinc, lead, silver
Manganese
By Commodity
(1)
Australia
Southern Africa
Americas
By Geography
(1)
SIERRA GORDA
Copper, Molybdenum and Gold
26%
15%
26%
15%
5%
13%
68%
16%
16%
A DIVERSIFIED
PORTFOLIO WITH A BIAS
TO BASE METALS
(1) Excludes manganese alloys, the Hermosa project, and Group and unallocated items/eliminations. Metallurgical coal comprises IMC, including energy coal by-product volumes
and excluding third party product.
FY24 Underlying EBITDA
US$1,802M
+ Read more on Segment Reporting in Note 4 to the financial statements on page 118.
Our business explained > Where we operate
8
SOUTH 32 ANNUAL REPORT 2024
CANNINGTON
Silver, Lead and Zinc
WORSLEY ALUMINA
Alumina
AUSTRALIA MANGANESE
Manganese ore
JOHANNESBURG
SINGAPORE
PERTH HEAD OFFICE
SOUTH AFRICA
MANGANESE
Manganese ore
LONDON
MOZAL
ALUMINIUM
Aluminium
HILLSIDE ALUMINIUM
Aluminium
ILLAWARRA METALLURGICAL COAL
Metallurgical coal
(2) For further information see page 25 of this report.
Our commodities
Aluminium value chain
Our aluminium value chain consists of integrated bauxite mines
and alumina refineries in Australia and Brazil, which supply our own
aluminium smelters in Southern Africa and export markets.
Copper
We have an interest in a conventional open-cut copper mine in the
prolific Antofagasta region in Chile, producing a commodity critical
to a low-carbon future.
Zinc, lead, silver
The Hermosa Taylor development project has the potential to be
one of the world's largest zinc producers. Cannington also produces
zinc and is one of the world’s largest producers of lead and silver.
Nickel
We are one of the world’s largest ferronickel producers with the
potential to produce intermediary nickel products for electric
vehicle markets.
Manganese
We are one of the world’s largest producers of manganese. We also
have the potential to produce battery-grade manganese at the
Hermosa Clark development option.
Metallurgical coal
We produce premium-quality, hard coking coal for domestic
and export steel markets. In February 2024 we entered into an
agreement to sell Illawarra Metallurgical Coal, which is expected to
complete on 29 August 2024
(2)
.
+
Learn more about our commodities and their uses
on pages 14 to 15.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
9
SOUTH 32 ANNUAL REPORT 2024
Mine/ProcessRefine/Smelt
Explore Develop
Market
Rehabilitate
and Close
Our business explained > Our business model
CREATING
LONG-TERM VALUE
As a global mining and metals company, we create value by producing commodities that are used
in many aspects of modern life and will play a critical role in a low-carbon future. Our operations,
development projects and options, and exploration prospects are diversified by commodity and
geography. We work to minimise the impact of our activities and aim to create enduring value
for our stakeholders, at each stage of the mining lifecycle.
The resources
we rely on
People and expertise
Our global workforce is made up of both
employees and contractors and is our
most important resource, providing
the skills, experience and technical
expertise required to run our business.
Natural resources
The resources and reserves we access
are the primary inputs for our business.
Other natural resources such as water
and energy are also important for
the operation of our facilities, and we
require access to land to conduct our
business activities.
Physical assets
We have a suite of operations including
open-cut and underground mines,
refineries, smelters and associated
infrastructure. We procure equipment
and services from suppliers globally to
support our operations, development
projects and options, and exploration
programs.
Finance
Our shareholders and lenders provide
access to financial capital, which we
put to work by operating our existing
facilities and funding our pipeline of
development projects and options, and
exploration programs.
Relationships
Trust and transparency are essential
to the way we operate. We seek to
build trust in the communities where
we have a presence to help realise the
potential of their resources, and we
work with our suppliers and customers
to apply responsible business practices
throughout our value chain.
What we do
10
SOUTH 32 ANNUAL REPORT 2024
We are committed to creating value for
our stakeholders, including our people,
communities, suppliers, customers,
governments and investors.
+
Learn more about our stakeholders
and impact on pages 12 to 13.
The outcomes
we create
Explore
We have a portfolio of more than 25 greenfield exploration partnerships and
prospects across the world to discover deposits to underpin our next generation
of mines, with a focus on commodities critical to a low-carbon future. We work to
minimise the footprint of our exploration activities through the use of technology
and well-designed programs.
Develop
Our development projects in base metals and pipeline of growth options in
various study phases have the potential to produce commodities to support the
transition to a low-carbon world. As we advance our projects and options we are
looking to reshape the way we mine to support better safety, productivity and
emissions outcomes, including as we develop the Taylor zinc-lead-silver deposit
at our Hermosa project.
Mine/Process
We mine and process bauxite, copper, zinc, lead, silver, nickel, manganese
and metallurgical coal. Our most important commitment at all of our sites is
the health, safety and wellbeing of our employees, contractors, visitors and
communities. We listen to our stakeholders and work together with the aim of
creating enduring value.
Refine/Smelt
We refine bauxite to produce alumina, we smelt alumina to produce aluminium,
and we smelt nickel ore to produce ferronickel. We are also executing
operational decarbonisation initiatives, focusing on our highest emitting
facilities.
Market
We generate revenue from the sale of our commodities to a global customer
base and purchase raw materials from global markets. We also analyse
commodities and their markets to inform our strategic business planning and
investment decisions. We are working to build meaningful partnerships with key
customers and suppliers to support and co-design greenhouse gas emissions
reduction programs in the value chain.
Rehabilitate and Close
From exploration through to closure and beyond, we seek to minimise our
adverse impacts on the surrounding communities and environments. We
undertake progressive rehabilitation where possible and our closure plans are
informed by the aspirations and expectations of our host communities and
countries.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
11
SOUTH 32 ANNUAL REPORT 2024
9,906
employees globally
(1)
US$913M in employee wages and benefits
446 graduates, apprentices, trainees and learners in our talent pipeline
We invest in our people through training and development to help them realise their
career aspirations
Inclusion and diversity is a core element of our culture and we are committed to building
and maintaining an inclusive and diverse workforce that reflects the communities in
which we operate
Our annual Your Voice employee survey allows us to understand and continuously
improve the employee experience
+
Learn more about our people and culture in our Sustainable Development Report
2024 at www.south32.net.
US$23.6M
in social investment
Our direct social investment spend was across our four key focus areas - education
and leadership (22 per cent), good health and social wellbeing (20 per cent), economic
participation (45 per cent), and natural resource resilience (13 per cent)
Over 30,000 students across more than 500 schools and learning institutions
participated in education and leadership programs funded by South32
We work collaboratively with Indigenous, Traditional and Tribal Peoples to preserve
cultural heritage and advance opportunities for economic participation and social
inclusion
+
Learn more about how we deliver value to society in our Sustainable Development
Report 2024 at www.south32.net.
Our business explained > Our stakeholders and impact
CREATING
BRIGHTER
FUTURES,
TOGETHER
We believe that, when done sustainably, the development
of natural resources can change people’s lives for the better.
Here are some of the ways we are doing this.
People
Communities
(1) Includes direct employees at our non-operated joint ventures.
12
SOUTH 32 ANNUAL REPORT 2024
We have set a target
(3)
to halve our operational greenhouse gas (GHG) emissions (Scope 1
and 2) by 2035 from our FY21 baseline
(4)
We have set a long-term goal
(3)
to achieve net zero GHG emissions across all scopes
(Scope 1, 2 and 3) by 2050
Operational water efficiency, which is the percentage of water used for operational
activities which is reused/recycled water, was 68.4 per cent in FY24
416 hectares of land under active rehabilitation in FY24, a 25 per cent increase from FY23
+
Learn more about our approach to climate change and our approach to managing our
environmental impact in our Sustainable Development Report 2024 at www.south32.net.
US$1,160M
spent on local procurement
A$34M procured from Aboriginal and Torres Strait Islander businesses in Australia
US$10M spent on Enterprise and Supplier Development in South Africa
(2)
We aim to source responsibly and enhance product stewardship across our value chain,
working with 5,857 direct suppliers in 51 countries and 197 customers in 31 countries
+
Learn more about our approach to responsible value chains in our Sustainable
Development Report 2024 at www.south32.net.
US$621M
in total taxes and royalties paid
Underlying effective tax rate of 39 per cent
Wherever we operate, we seek to work collaboratively with governments to help them
realise value from natural resources and transition towards low-carbon economies
We work with a range of stakeholders and seek to influence public policy to create an
environment that supports the sustainable development of natural resources
+
Learn more about our approach to tax in our Tax Transparency and Payments to
Government Report 2024, and our approach to industry associations
at www.south32.net.
Our capital management framework prioritises maintaining safe and reliable operations
and an investment grade credit rating through the cycle. We intend to distribute a
minimum of 40 per cent of Underlying earnings as ordinary dividends
US$163M in dividends returned to shareholders during FY24
US$35M allocated to our on-market share buy-back during FY24
+
Learn more about our capital management framework in Our strategy on page 19.
Suppliers and Customers
Environment and Climate Change
Governments
Investors
(2) The Enterprise Development component (US$3.7M in FY24) is also captured in our social investment total.
(3) In this report we use particular terminology in relation to climate change. Definitions of the terms 'goal',
'target' and 'low-carbon' when used in the context of climate change are set out in the Glossary of terms and
abbreviations on pages 191 to 198 of this report.
(4) FY21 baseline adjusted to exclude GHG emissions from South Africa Energy Coal and Tasmanian Electro
Metallurgical Company, which were divested in FY21.
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SOUTH 32 ANNUAL REPORT 2024
Our business explained > Our commodities
HELPING CREATE
A LOW-CARBON FUTURE
Our commodities are used in many aspects of modern life and we are actively
reshaping our portfolio to increase our exposure to commodities critical
to a low-carbon future. Key market sectors where our commodities have an
important role to play include energy and renewables, the automotive industry
including electric vehicles, construction, and consumer goods.
Aluminium value chain
Aluminium is often referred to as the
metal of the future. It is lightweight,
durable, strong, resistant to corrosion,
recyclable and can conduct electricity.
It has a wide range of applications
including construction, electrical
wiring, transportation including electric
vehicles and their batteries, packaging,
consumer goods, and has the potential to
substitute copper for certain applications
in aerospace and rail. We produce both
alumina and aluminium, and have doubled
our low-carbon aluminium
(1)
capacity since
inception.
(1) A definition of the term 'low-carbon aluminium' when used in the context of climate change is set out in the Glossary of terms and abbreviations on pages 191 to 198
of this report.
Copper
Copper is an excellent conductor of
electricity. It is a key metal used in electric
vehicles and charging infrastructure, and
as the world moves towards electrification
it will be used in power-related
infrastructure including renewable energy
generation. Copper is also widely used
in construction and consumer durables
including household appliances. We hold
an interest in the Sierra Gorda copper
mine in Chile which has embedded options
for further growth, and we are progressing
a pipeline of options to grow our copper
volumes as we seek to capitalise on
the long-term demand outlook for the
commodity.
Zinc, Lead, Silver
Zinc protects steel structures, wind
turbines and solar panels against
corrosion, and zinc oxide coatings help
achieve higher energy conversion in solar
panels. Lead batteries have potential to
be used in energy storage systems to
support uptake of renewable energy.
Silver is used in solar panels, the electrical
systems of vehicles, medical appliances
and consumer electronics. We have
been producing zinc, lead and silver at
Cannington for more than 25 years, and
are investing US$2.16 billion to develop
the Taylor zinc-lead-silver deposit at our
Hermosa project, with first production
expected in the second half of FY27.
14
SOUTH 32 ANNUAL REPORT 2024
Nickel
Nickel is used in stainless steel, which is
used in transportation, manufacturing,
household items and surgical instruments.
Nickel has an important role to play as the
world transitions to a more sustainable
future as it is used as an alloy in wind and
solar power infrastructure. Nickel-rich
batteries are also critical for the rapid
adoption of electric vehicles. We are one of
the world’s largest ferronickel producers
with the potential to produce intermediary
products for electric vehicles.
(2) For further information see page 25 of this report.
Manganese
Manganese is used to improve the
quality and strength of steel in major
infrastructure such as hospitals, office
towers and bridges. Manganese also
has the potential to displace cobalt in
lithium-ion batteries, with demand for
manganese-rich cathode chemistries
expected to grow. We are well positioned
to meet future demand as we are
one of the world’s largest producers
of manganese from our operations
in Australia and South Africa, and the
Hermosa Clark development option has
the potential to produce battery-grade
manganese.
Metallurgical coal
Currently there is no commercial scale
alternative to metallurgical coal in the
steelmaking process. The use of high-
quality metallurgical coal that we produce
helps reduce greenhouse gas emissions in
the steel industry through improved blast
furnace efficiency, when compared with
lower-quality metallurgical coal. In February
2024 we entered into an agreement to
sell Illawarra Metallurgical Coal, which is
expected to complete on 29 August 2024
(2)
.
While we have taken the decision to exit
metallurgical coal, we continue to believe
it has an important role in the steelmaking
process for years to come.
Aluminium (kt)
1,138
Alumina (kt)
5,063
Copper (kt)
60.8
Metallurgical coal (kt)
4,305
Silver (koz)
13,273
Lead (kt)
112.4
Zinc (kt)
60.7
Manganese ore (kwmt)
4,499
Nickel (kt)
40.6
FY24 production at a glance
+ Learn more about our portfolio in a low-carbon world in our Sustainable Development Report 2024 at www.south32.net.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
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SOUTH 32 ANNUAL REPORT 2024
At South32, we are united by our belief
that everyone can go home safe and well,
every day, and we remain committed
to pursuing continual improvements in
safety.
We assess our safety performance
through a range of both leading and
lagging indicators. Our significant hazard
frequency, a leading indicator, increased
by 34 per cent compared to FY23,
indicating a positive reporting culture and
increased hazard awareness. Conversely,
our lost time injury frequency, a lagging
indicator, increased by 19 per cent
compared to FY23, underscoring that
while we had no fatalities at our operations
in FY24, we are still seeing too many
serious injuries and we must be relentless
in our pursuit of a safer workplace.
FY24 was the third year of our Safety
Improvement Program, which aims to
achieve a step change in our safety
performance. The program includes
significant investment in safety leadership
through our LEAD Safely Every Day
program and in FY24 we extended this
to frontline employees, a focus that will
continue in FY25.
We are also continuing to embed our
'safety guarantee' across our business,
which is used to instil a belief that
everyone can go home safe and well,
create a sense of chronic unease, reduce
complacency, and assist to reduce risk
tolerance. We do this by asking our people
to reflect on whether they can guarantee
both their safety and that of their
colleagues when executing their role. If the
answer is no, the expectation is that they
stop and ask what would need to be done
differently to provide that guarantee.
Of course, safety means more than
just physical safety. This year we have
progressed the development of our new
psychosocial risk framework which aims
to standardise the way we identify, assess
and mitigate psychosocial risks. We
continue to manage sexual harassment as
a material health and safety risk and our
approach to preventing and addressing
this risk is multi-faceted, involving both
cultural and educational aspects as well as
enhanced controls.
One of the ways to eliminate sexual
harassment in our workplaces is
through inclusion and increased female
representation. More broadly, we know
that an inclusive culture and diverse
workforce leads to better business
outcomes and we remain focused
on shaping a safety focused, high
performance and values-based culture
where everyone feels safe, included and
respected at work.
We made some changes to our Lead
Team in FY24, with Vanessa Torres
moving from Chief Technical Officer to
become our Chief Operating Officer
Australia, and Erwin Schaufler promoted
to Chief Technical Officer. We maintained
50 per cent female representation on
our Lead Team and while we have a
series of targets and actions aimed at
improving inclusion and diversity across
our organisation, our aim remains for our
workforce to reflect the communities in
which we operate.
In Australia, we have reaffirmed our
commitment to reconciliation in our
second Innovate Reconciliation Action
Plan. Launched in July 2024, it outlines
how we are creating opportunities for
Aboriginal and Torres Strait Islander
Peoples and contains more ambitious
goals and targets.
At a global level, the past 12 months have
been marked by a mix of recovery and
volatility. Despite heightened geopolitical
tensions, the macroeconomic outlook
has gradually improved, driven by major
economies including China, the United
States and India. Interest rates remained
high and although global inflation rates
have eased from the peaks experienced in
2022, inflationary pressures have persisted
in some regions.
Severe weather also affected our business
this year, with Cannington impacted
by Tropical Cyclone Kirrily in January
and Australia Manganese significantly
impacted by Tropical Cyclone Megan
in March, resulting in the temporary
suspension of operations on Groote
Eylandt.
I visited Groote Eylandt in the aftermath of
the cyclone and the impact was immense,
with widespread flooding and significant
damage to critical infrastructure. Most
importantly, there were no recordable
injuries. The operational recovery at
Australia Manganese is underway and we
commenced a phased mining restart in
the fourth quarter.
Against this challenging backdrop, we set
consecutive annual production records
at Hillside Aluminium and South Africa
Manganese, and lifted production at
Cannington by 10 per cent. Improved
BUILDING A STRONGER,
SIMPLER BUSINESS
The diligent execution of our strategy is transforming our company. We continue to
optimise our base business, we are unlocking value from our high-quality
development projects in zinc and copper, and we are identifying a pipeline of
prospects for future growth in base metals.
“
We achieved two key strategic milestones this year
which have accelerated our transformation towards
commodities critical for a low-carbon future.”
From the CEO
16
SOUTH 32 ANNUAL REPORT 2024
operating performance, disciplined cost
management and higher prices for our key
commodities lifted our financial results to
finish the year.
As a result, Underlying earnings and cash
flow increased in the second half of the
year, and we recorded FY24 Underlying
earnings before interest, tax, depreciation
and amortisation of US$1.8 billion.
Central to our strategy is our commitment
to a strong balance sheet and an
investment grade credit rating through
the cycle. We finished the year with net
debt of US$762 million as we balanced
returning cash to shareholders with
investing in our business.
This year, we have achieved two key
strategic milestones in the evolution of our
business.
Firstly, we announced final investment
approval for the Taylor zinc-lead-silver
deposit at our Hermosa project. Taylor
offers the potential for a long-life,
low-cost, low-carbon operation that is
expected to deliver attractive returns over
multiple decades.
The investment also creates a platform
for further development, with Taylor
designed to be the first phase of a
regional scale opportunity at Hermosa.
Our US$2.16 billion investment in Taylor
will establish infrastructure including
dewatering, power, roads and site facilities,
which will unlock value for future growth
options. These options include the Clark
battery-grade manganese deposit
and potential discoveries in our highly
prospective regional land package that
includes the Peake deposit and Flux
prospect, with recent drilling at Peake
returning further high-grade copper results.
Hermosa is currently the only advanced
project in the United States that could
supply two federally designated critical
minerals, zinc and manganese, and in 2023
it was confirmed as the first mining project
to be added to the FAST-41 process,
enabling a more efficient and transparent
federal permitting process.
Supporting our investment in Taylor is our
view on the markets it will serve. Taylor
is a potential top 10 global zinc producer
and with zinc demand growth expected
to outpace production to 2031 as it plays
a role in global decarbonisation efforts,
we expect higher incentive zinc prices as
Taylor ramps up to nameplate capacity.
Shortly after the Taylor final investment
decision, we announced the sale of
Illawarra Metallurgical Coal for up to
US$1.65 billion. The agreement became
unconditional on 29 July 2024 and is
expected to complete on 29 August 2024.
This transaction will realise significant
value for our shareholders. It will simplify
our business, strengthen our balance
sheet and reduce our capital intensity,
unlocking capital to invest in our high-
quality development projects in copper
and zinc.
As a result of these strategic decisions,
we now have a stronger, simpler portfolio
that is leveraged to commodities critical
for a low-carbon future. We are also
progressing a pipeline of prospects in
targeted regions through the drill bit, with
exploration activity this year including
consolidating our position in the highly
prospective San Juan region of Argentina.
Reshaping our portfolio is a key element
of our approach to climate change, as
is decarbonising our operations. The
majority of our operational greenhouse
gas (GHG) emissions (Scope 1 and 2)
are generated in our aluminium value
chain which is where we are focusing our
decarbonisation efforts.
We converted two coal-fired boilers to
natural gas at Worsley Alumina, reducing
the refinery’s operational GHG emissions
by over 10 per cent against FY21 levels.
At our aluminium smelters in South Africa
and Mozambique, we continue to work
with stakeholders and governments on
identifying and securing long-term, low-
carbon energy solutions.
The actions we take to address climate
change are also relevant to the growing
imperative to protect nature and we plan
to publish our approach to addressing
nature-related risks and opportunities in
FY25.
As we enter our 10th year, the South32
of today looks very different to the one
we established in 2015 and is primarily
focused on our aluminium value chain,
base metals and manganese, an attractive
commodity mix from which we believe we
can grow.
I would like to thank all our teams around
the world for the role they are playing
as we further establish our company
as a global, diversified producer of
commodities critical for a low-carbon
future.
Graham Kerr
Chief Executive Officer
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
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SOUTH 32 ANNUAL REPORT 2024
Our strategy
+
Learn more about our approach to sustainability in our Sustainable Development Report 2024
at www.south32.net.
A STRATEGY
TO ACHIEVE
OUR PURPOSE
Our purpose is at the heart of who we are. Every day, in support of our purpose
and underpinned by our approach to sustainability, our people work to deliver
our strategy for the benefit of our stakeholders.
Our purpose is to make a difference by developing natural resources, improving people's lives now and for
generations to come. We are trusted by our owners and partners to realise the potential of their resources.
Our purpose is underpinned by a simple strategy.
Sustainability is at the heart of our purpose and underpins the delivery of our strategy.
Our approach to sustainability aims to balance environmental, social and economic considerations,
and to support delivery of our purpose and strategy in a way that creates enduring value for our
stakeholders. It comprises five interconnected pillars which focus on areas that are material to our
stakeholders and our business.
We are committed to continuously improving our sustainability performance, optimising our positive
contributions, and minimising our adverse impacts by:
We optimise our business
by working safely, minimising
our impact, consistently
delivering stable and
predictable performance,
and continually improving
our competitiveness.
We unlock the full value
of our business through
our people, innovation,
projects and technology.
We identify and
pursue opportunities to
sustainably reshape our
business for the future,
and create enduring
social, environmental
and economic value.
Protecting
and respecting
our people
Delivering
value to
society
Operating
ethically and
responsibly
Managing our
environmental
impact
Addressing
climate change
18
SOUTH 32 ANNUAL REPORT 2024
Delivering our strategy
We deliver our strategy by aligning our
workforce behind seven ‘breakthroughs’
– commitments which shape our annual
business planning process, enabling us to
focus on what’s important.
Our first breakthrough is ‘we all guarantee
everyone goes home safe and well’, which
asks each person in our workforce to take
responsibility for their own safety and
wellbeing, and that of their colleagues. Our
'safety guarantee' is an internal approach
that is used to instil a belief that everyone
can go home safe and well, create a sense
of chronic unease, reduce complacency,
and assist to reduce risk tolerance in
relation to safety and health.
Risk management and corporate
governance
We are governed by robust risk
management and corporate governance
frameworks. Learn more in our Risk
management section on pages 28 to
38, and in our Corporate Governance
Statement 2024 at www.south32.net.
(1) For further information see page 25 of this report.
(2) Total capital allocation since FY16 includes proceeds from the sale of Illawarra Metallurgical Coal.
Climate-related financial
disclosures
Our climate-related financial disclosures,
which we consider to be consistent with
the four recommendations and the 11
recommended disclosures of the Task
Force on Climate-related Financial
Disclosures (TCFD) are set out in the
Addressing Climate Change section and
the Risk management sub-section of the
Our sustainability approach section of the
Sustainable Development Report 2024, as
well as the Emissions Methodology tab in
our Sustainability Databook 2024, both of
which are available at www.south32.net.
We have included our TCFD-aligned
disclosures in the separate Sustainable
Development Report 2024 and
Sustainability Databook 2024 to enable
us to provide this information alongside
detailed updates on our sustainability
activities more widely and our progress
against our Climate Change Action Plan.
Our Standards and Frameworks
Reporting Index 2024, also available at
www.south32.net, sets out each of the
TCFD's 11 recommended disclosures,
and where information relating to each
recommended disclosure can be found
in our Sustainable Development Report
2024 and our Sustainability Databook
2024. As some of our climate-related
financial disclosures are outlined in our
Sustainable Development Report 2024 and
Sustainability Databook 2024, this Annual
Report should be read in conjunction with
these documents and our Standards and
Frameworks Reporting Index 2024.
Capital management framework
Our strategy is underpinned by a disciplined
approach to capital management.
Our capital management framework
remains unchanged, supporting investment
in our business and rewarding shareholders
as our financial performance improves.
Our capital allocation priorities are to
maintain safe and reliable operations and an
investment grade credit rating throughout
the cycle. We intend to distribute a minimum
of 40 per cent of Underlying earnings as
ordinary dividends to our shareholders
following each six-month reporting period.
We encourage internal competition for
excess capital, which can include further
investment in new projects, acquisitions,
greenfield exploration, share buy-backs or
special dividends.
We returned US$198 million to
shareholders during FY24 via ordinary
dividends and our on-market share
buy-back. In February 2024, we took the
decision to cancel our on-market share
buy-back to manage our financial position
and retain the right balance of flexibility,
efficiency and prudence. Reflecting the
Group's strengthened financial position
and our disciplined approach to capital
management, the Board has resolved to
allocate US$200 million to our ongoing
capital management program, to be
returned to shareholders via an on-
market share buy-back, commencing
from completion of the sale of Illawarra
Metallurgical Coal
(1)
and to be returned by
12 September 2025.
Capital allocation since FY16
(2)
41%
20%
14%
19%
2%
4%
US$17.1B
allocated
Capital expenditure
(including equity accounted investments)
Ordinary dividends
Capital management program
Acquisitions
Greenfield exploration
Net cash added to balance sheet
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19
SOUTH 32 ANNUAL REPORT 2024
Our strategy in action
OPTIMISE OUR BUSINESS
Working safely
Our FY24 commitments:
〉 At least 90 per cent of LEAD Safely Every Day learning activities completed by leaders;
〉 A significant hazard to significant event near miss ratio of more than 15;
〉 A 60 per cent reduction in the number of injuries and acute illnesses associated with a potential fatality compared to the
FY23 baseline;
〉 A year-on-year reduction in lost time injury frequency (LTIF)
(1)
; and
〉 A reduction in total recordable injury frequency (TRIF)
(1)
from the FY22 baseline.
Progress during FY24:
(1) Frequency rates as per million hours worked. Incidents are included where South32 controls the work location or controls the work activity.
No fatalities occurred at our operations during FY24 – an outcome
we aim to sustain through our commitment to delivering our
safety transformation.
Nothing is more important than the health, safety and wellbeing
of our people and we are continuing to implement our Safety
Improvement Program, a multi-year program of work launched
in FY22 with the aim of achieving a step change in our safety
performance.
One of the key focus areas of the Safety Improvement Program is
shifting mindsets through leadership. We are investing in safety
leadership through our LEAD Safely Every Day program, with
safety leadership capability workshops and coaching delivered
to over 1,500 leaders to date. In FY24, 96 per cent of LEAD Safely
Every Day learning activities were completed by leaders.
Proactive hazard reporting is an important part of our approach
to safety and this year we have disclosed the significant hazard
to significant event near miss ratio for the first time. This leading
indicator represents how well we are identifying hazards in
comparison to the number of near miss events that are occurring.
The higher the ratio, the more effective we are at identifying
hazards to minimise near misses and injuries. This year’s ratio of
21 indicates improved hazard awareness and a positive reporting
culture.
High potential injuries and illnesses are those which have the
potential for significant harm or could result in a fatality. This
lagging indicator increased by 12 per cent year-on-year, missing
our target and demonstrating that we still have work to do to
eliminate potential fatalities from our business.
Our LTIF increased by 19 per cent compared to FY23, mostly
driven by an increase in lost time injuries at our Australian
operations, and did not meet our target. Our TRIF decreased by
14 per cent compared to FY23 and five per cent compared to
FY22, meeting our target. The year-on-year decrease reflects
significant improvement in the TRIF for Illawarra Metallurgical
Coal, as well as an improvement in contractor TRIF.
We disclose fatalities for contractor activities that are associated
with our operations but take place in locations where we do not
have control. In FY24, an employee from a company contracted
by South Africa Manganese lost their life in a tragic off-site road
trucking accident. We continue to engage with our trucking
contractors in South Africa on ways to improve road safety.
+
Learn more about our approach to health and safety in our
Sustainable Development Report 2024 at www.south32.net.
20
SOUTH 32 ANNUAL REPORT 2024
Stable and predictable performance while minimising impact
Our FY24 commitments:
〉 Achieve 97 to 102 per cent of target revenue equivalent production;
〉 Controllable costs within 2.5 per cent of target (adjusted for foreign exchange, price-linked costs, and other adjustments);
〉 Capital expenditure (excluding growth) within five per cent of target (adjusted for foreign exchange);
〉 Growth capital expenditure within 10 per cent of target; and
〉 Achieve target adjusted return on invested capital (ROIC), consistent with our cost, production and capital expenditure
targets.
Progress during FY24:
We achieved 96.5 per cent of target revenue equivalent
production. We set consecutive annual production records
at Hillside Aluminium and South Africa Manganese, and lifted
production at Cannington by 10 per cent despite adverse weather
impacts. This was offset by challenges at other locations including
Australia Manganese which temporarily suspended operations
in March 2024 due to Tropical Cyclone Megan, and Sierra
Gorda where higher plant throughput was offset by lower than
planned copper grades. For more information on our operating
performance, see pages 55 to 66.
Controllable costs were within 1.7 per cent of target, as we
continued our focus on disciplined cost management.
Capital expenditure excluding growth projects was 94 per cent of
target, with investments including additional ventilation capacity
at Illawarra Metallurgical Coal, energy transition projects at
Worsley Alumina and the De-bottlenecking Phase Two project at
Brazil Alumina.
Capital expenditure on growth projects, which was focused on the
Hermosa project, was 93 per cent of target as we installed critical
path infrastructure and progressed studies and permitting for the
Taylor and Clark deposits.
The adjusted ROIC was 69 per cent of target.
+
Learn more about how we seek to minimise our impact in
Create social, environmental and economic value on page 24.
Frontline Focus
The LEAD Safely Every Day program, which forms
part of our global Safety Improvement Program,
was launched in FY23 and in FY24 we extended it
to frontline employees and a sub-set of contractors
at our operations that perform high-risk work, and
functional roles that support them.
While the program’s rollout is tailored, the overall
objectives remain to form a common understanding of
what it means to be a safety leader at South32, embed
a consistent approach to safety risk management, and
empower our people to speak up so that together we
can prevent serious injuries and fatalities.
By the end of FY24, approximately 1,000 frontline
employees in Australia, South Africa and Mozambique
had participated in the program and it’s roll-out will
continue in FY25, where it will be extended to all
operations.
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SOUTH 32 ANNUAL REPORT 2024
Our strategy in action continued
UNLOCK THE FULL VALUE OF OUR BUSINESS
Our people are connected and engaged
Our FY24 commitments:
〉 Achieve our annual inclusion and diversity targets and
deliver all activities on the annual inclusion and diversity
action plan; and
〉 Maintain or improve our inclusion index score compared
to FY23.
Progress during FY24:
An inclusive culture and diverse workforce allows for greater
collaboration, innovation, and performance. We set and track
performance against a series of measurable objectives which are
targets and actions aimed at improving inclusion and diversity
in our workplace. In FY24, we met the target for four of our eight
measurable objectives.
There are five measurable objectives for the representation of
women in our workforce and senior roles. The representation
of women in our overall workforce improved, increasing to
20.6 per cent from 20.2 per cent in FY23, however this fell short
of our aspirational goal of 23.5 per cent. The representation
of women on our Board increased to 50 per cent from
44 per cent in FY23, meeting our target of at least 40 per cent.
The representation of women on our Lead Team remained
at 50 per cent and met our target of at least 40 per cent, the
representation of women in our Senior Leadership Team remained
at 30.3 per cent and fell short of our target of 32.7 per cent, and
the representation of women in our Operational Leadership Team
decreased to 25.7 per cent from 28.7 per cent in FY23 and fell
short of our target of 31.5 per cent.
There are two measurable objectives for the representation of
Black People in our South African workforce. The representation
of Black People in our overall workforce in South Africa
improved, increasing to 88.4 per cent from 86.9 per cent in FY23
and meeting our target of at least 85 per cent, however the
representation of Black People in management roles in South
Africa decreased to 51.8 per cent from 55.3 per cent in FY23,
below our target of at least 60 per cent.
The final measurable objective is continuing to target pay equity
for our employees with respect to gender and ethnicity. We
completed our annual pay equity review, investing US$292,000
to improve pay equity and meeting our target of reducing spend
year-on-year to close the pay gap.
Our FY24 inclusion and diversity action plan focused on five
activities, including embedding the performance requirements
of our internal inclusion and diversity standard, conducting
comprehensive sexual harassment risk assessments and rolling
out a discussion series on the important role bystanders can play,
with all five activities completed.
Our annual Your Voice employee survey assesses five dimensions
– safety, leadership, employee engagement, employee experience
and workplace conduct. In FY24, respondents reported an equal
or improved experience in all five dimensions and our inclusion
index score, which measures perceptions of inclusion in our
workplace, increased to 82.3 per cent from 81.5 per cent in FY23
(1)
.
+
Learn more about our approach to people and culture in our
Sustainable Development Report 2024 at www.south32.net.
(1) Given the agreement to sell Illawarra Metallurgical Coal and focus on recovery efforts following Tropical Cyclone Megan at Australia Manganese, employees at these operations
did not participate in this year’s Your Voice employee survey. Survey results presented in this report are calculated on re-baselined data to support year-on-year comparison
against the same operations in scope.
Technology and innovation unlock value
Our FY24 commitments:
〉 Deliver critical technology and innovation programs.
Progress during FY24:
Technology and innovation are key enablers of our transition
towards a low-carbon future and to realising our objective of
safer, cleaner and more productive operations. To focus our
innovation investment in the areas that matter most, in FY20 we
established Innovate32, our strategy-aligned, value-creating,
portfolio approach to enable innovation at South32.
Innovate32 encompasses three innovation workstreams – the
Low Footprint Mission, the Next Generation Mine Mission, and the
Securing Future Resources Mission.
The Low Footprint Mission oversees decarbonisation innovation
initiatives, as well as waste, water and biodiversity initiatives
focused on minimising our environmental impact. A key milestone
in FY24 was the completion of a techno-economic assessment
of catalytic ventilation air methane (VAM) abatement technology
at Illawarra Metallurgical Coal to further investigate its potential.
We also worked with technology vendors, industry partners and
intellectual property owners to develop a plan to commercialise
catalytic VAM abatement solutions.
The Next Generation Mine Mission aims to reshape the way
we mine to support better safety, productivity and emissions
outcomes. In FY24 we continued various processing and
technology trials at Cannington, including battery electric mobile
equipment with the aim of reducing the use of diesel vehicles
and equipment and their associated emissions. Learnings from
the trials will be used to inform our next generation of mines,
including at Hermosa where the underground mine design for
the Taylor development project includes primary and secondary
battery electric charge bay infrastructure for battery electric
production loaders.
Another key focus area for the Next Generation Mine Mission is
utilising artificial intelligence (AI) to unlock value. We recognise
the potential that AI offers and have established a targeted
approach that allows us to scale and unlock value in four areas
that support our strategy and create shareholder value – safety,
cash generation, exploration, and productivity enablers. We
have already unlocked value through AI initiatives at Australia
Manganese, Worsley Alumina and Cerro Matoso, with plans to
scale to other operations. Our work in AI follows responsible
AI frameworks and is underpinned by risk management,
governance, cyber and privacy controls.
The Securing Future Resources Mission focuses on reducing the
level of uncertainty in early mineral exploration phase investment
through innovation in area selection, target identification and
resource evaluation. In FY24, we continued developing orebody
knowledge and processing technologies that will help us unlock
value from complex copper ore bodies.
Learn more about how we are leveraging technology and
innovation, and collaborating with others, in the Addressing
climate change section of our Sustainable Development Report
2024 at www.south32.net.
22
SOUTH 32 ANNUAL REPORT 2024
Project execution
Our FY24 commitments:
〉 Complete Taylor deposit shaft pre-sink to plan, present project for final investment decision (FID) and commence and
progress shaft development to plan; and
〉 Progress Clark deposit engineering and federal funding submission for proposed plant on schedule, and progress decline
development to plan.
Progress during FY24:
(2) Refer to market release "Final Investment Approval to Develop Hermosa’s Taylor Deposit" dated 15 February 2024.
(3) Refer to market release "Worsley Alumina Approvals Update" dated 22 July 2024.
In February 2024 we announced final investment approval for
the Taylor zinc-lead-silver deposit
(2)
, the first development at our
Hermosa project and a major milestone aligned with our strategy.
Taylor is expected to deliver attractive returns over multiple
decades, with the feasibility study confirming the potential for a
long-life, low-cost, low-carbon operation. It is expected to reach
first production in the second half of FY27 and deliver nameplate
production in FY30.
Once in production, Taylor will increase our supply of commodities
critical for a low-carbon future and is expected to sustainably
lift Group margins due to its first quartile cost position. With
global zinc demand growth expected to outpace production by
approximately three million tonnes to 2031, we expect higher
incentive prices for zinc as Taylor ramps up to nameplate capacity.
As the first phase of a regional scale opportunity at Hermosa,
Taylor’s infrastructure including dewatering, power, roads and site
facilities, will unlock value for future growth options. These include
Clark, our battery-grade manganese deposit, and potential
discoveries in our highly prospective regional land package, which
has already returned high-grade copper and zinc results from the
Peake deposit and Flux prospect. There is the potential to add
a capital efficient copper circuit to Taylor to process copper-rich
material from Peake.
Taylor has now progressed into execution and our immediate
focus is completing the construction of critical path infrastructure.
The shaft pre-sink has been completed on schedule and
construction of the main access and ventilation shafts is on track
to commence in the first quarter of FY25.
We are progressing Clark to potential development via key
workstreams across study work, product validation and customer
engagements. We have commenced engineering design studies
on the proposed plant for the next phase of metallurgical testing
to evaluate the final capacity, location and estimated capital
costs. We have also commenced construction of an exploration
decline to provide access to ore for demonstration scale output,
which is on track to be completed by the end of 2025. In May
2024 we were awarded a US$20 million grant by the United
States Department of Defense to help accelerate the domestic
production of battery-grade manganese, and we have also
submitted a request for federal funding to support the next
phase of testing.
At Sierra Gorda, we have progressed a feasibility study for the
fourth grinding line expansion, which is expected to deliver an
increase in plant throughput and grow our copper production.
The feasibility study and a final investment decision by the joint
venture partners is expected in the first half of FY25.
At Worsley Alumina, we continue to progress the environmental
approval process for the Worsley Mine Development Project
to enable access to bauxite to sustain production. We have
undertaken a carrying value assessment of Worsley Alumina
having regard to the increased uncertainty created by the
approval process and associated challenging operating
conditions, and have recognised an impairment expense for
Worsley Alumina with our FY24 financial results. We continue to
work collaboratively with the Western Australian Government and
aim to secure environmental approvals by the end of 2024
(3)
.
Looking Back to Look Forward
Our Cannington operation, which has produced zinc, lead and silver for more than
25 years, and the Taylor zinc-lead-silver deposit at our Hermosa project, which we
announced final investment approval to develop in FY24, have similar orebodies.
This has provided an opportunity for the Hermosa team to leverage the extensive
knowledge and experience of the Cannington team in the design of the Taylor
processing plant.
Cannington’s Superintendent Processing visited the project site in May 2024 to
share insights and ideas to help enhance and de-risk the development of Taylor.
Areas for discussion and collaboration have included hazard identification,
concentrator design, water management, and the trials of innovative technologies
at Cannington for potential use at Hermosa. Although Taylor will be a very different
facility to Cannington, the learnings will help set it up for long-term success.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
23
SOUTH 32 ANNUAL REPORT 2024
Our strategy in action continued
IDENTIFY OPPORTUNITIES
Create social, environmental and economic value
Our FY24 commitments:
〉 Implement social investment plans on time and on budget;
〉 Apply our social investment impact measurement framework to our Hotazel Manganese Mines and Hillside Aluminium
economic development plans;
〉 Introductory human rights training completed by all targeted roles and made available to the wider workforce; and
〉 Deliver contextual water target milestones to agreed plan and achieve the FY24 target water use efficiency outcome as
defined within our Sustainability Linked Loan (SLL) framework.
Progress during FY24:
(1) FY21 baseline adjusted to exclude GHG emissions from South Africa Energy Coal and Tasmanian Electro Metallurgical Company, which were divested in FY21.
(2) The grid emission factor measures the amount of GHG emissions per unit of electricity generated. This includes all generation sources such as coal, natural gas, solar and
waste-to-energy.
Social investment plans were implemented for each operation
and we invested US$23.6 million in community initiatives. Our
direct social investment spend was across our four key focus
areas - education and leadership (22 per cent), good health and
social wellbeing (20 per cent), economic participation (45 per cent)
and natural resource resilience (13 per cent).
The economic value of our presence in communities is an
important part of our societal contribution and we develop
economic development plans as required by our internal social
performance standard. These are complementary to our social
investment plans and identify opportunities to contribute to
local communities through employment, procurement, business
development, and regional economic development. In FY24, we
applied our social investment impact measurement framework to
our Hotazel Manganese Mines and Hillside Aluminium economic
development plans which focus on skills development and
Enterprise and Supplier Development (ESD) activities.
We believe that growing and developing small, medium, and
micro enterprises (SMMEs) is fundamental to the transformation
of the South African economy. We collaborate with SMMEs on
ESD and our FY24 ESD expenditure of US$10 million exceeded our
target of US$3.48 million.
In Australia, we are committed to increasing our procurement
of goods and services from Aboriginal and Torres Strait Islander
businesses through a dedicated procurement strategy, with
spend increasing by 11 per cent to A$34 million in FY24.
We have a responsibility to manage human rights risks to people
across our operations and business relationships. Our suite of
human rights training, which includes an introductory human
rights module and two modules on modern slavery and security,
is assigned to selected employees based on their role and is
made available to all employees. The introductory module was
completed by 95 per cent of targeted roles in FY24.
Water is a vital shared resource and a critical input for our
operations. In 2019 and 2022 we established contextual water
targets for five operations which were identified as experiencing
material water-related risks at that time, with two operations
achieving their targets in prior years. For the three that remain, six
out of seven milestones were met in FY24. In FY22, we established
a water efficiency target (WET) for four operations identified as
being exposed to baseline water stress at that time, to collectively
achieve a 10 per cent improvement in water use efficiency by
FY27. The WET is one of three overarching key performance
indicators for our SLL. Progress against the WET remains on
track and we exceeded the FY24 stretch outcome for water use
efficiency as defined within the SLL.
We recognise the importance of protecting and conserving
biodiversity. We owned, leased or managed over 607,000
hectares of land in FY24, approximately three per cent of which
has been disturbed as a result of our activities. Of this disturbed
land, 34 per cent is in various stages of rehabilitation. In FY24,
over 190 hectares of land was disturbed through our activities
and we undertook progressive rehabilitation activities across
approximately 416 hectares, a 25 per cent increase from FY23.
Our approach to climate change is focused on reshaping our
portfolio, decarbonising our operations, working with others, and
understanding and responding to the potential physical impacts
of climate change.
Our reported operational greenhouse gas (GHG) emissions (Scope
1 and 2) for FY24 were 20.3 Mt CO
2
-e, a six per cent decrease from
FY23 and two per cent decrease from our FY21 baseline
(1)
. Scope
1 GHG emissions decreased by nine per cent year-on-year largely
due to decreased GHG emissions at Worsley Alumina and lower
fugitive emissions from Ilawarra Metallurgical Coal, and Scope 2
GHG emissions decreased by four per cent year-on-year primarily
due to a decrease in the Eskom grid emission factor
(2)
for our
South African operations.
With 81 per cent of our operational GHG emissions in FY24
generated by three operations – Hillside Aluminium, Worsley
Alumina and Mozal Aluminium, we continue to focus on
decarbonisation programs and initiatives in our aluminium value
chain.
At Worsley Alumina, we converted two coal-fired boilers to natural
gas, progressed the product washing dilution reduction project
into execution, and advanced our pipeline of decarbonisation
studies. At Hillside Aluminium, we converted 36 per cent of pots to
AP3XLE energy efficiency technology and identified that we need
to partner with Eskom and the South African Government towards
a comprehensive low-carbon energy solution for the operation
beyond 2031. We also engaged extensively with stakeholders
including the Government of the Republic of Mozambique to
secure an affordable, long-term low-carbon energy source for
Mozal Aluminium beyond 2026, as there are currently no viable
alternative suppliers of renewable energy at the required scale.
+
Learn more about our approach to sustainability in our
Sustainable Development Report 2024 at www.south32.net.
24
SOUTH 32 ANNUAL REPORT 2024
Fuelling Groote Eylandt’s Recovery
In March 2024, Groote Eylandt in Australia’s Northern
Territory was significantly impacted by Tropical Cyclone
Megan, with widespread flooding and damage to critical
infrastructure.
In addition to managing the impact on Australia
Manganese, our Groote Eylandt Mining Company (GEMCO)
team played a key role in supporting communities on the
Eylandt to get back on their feet.
GEMCO performs a unique role by providing a range of
infrastructure and services which the community relies
on, including fuel and electricity supply.
With fuel supply to the Eylandt cut off, the GEMCO team
rationed the operation’s fuel reserves, coordinating
fuel access and ‘manning the pumps’ for approximately
14 weeks to support key service providers such as
emergency services, health, education, Aboriginal
corporations, as well as the public, until fuel deliveries to
the Eylandt resumed in late June.
Sustainably reshape our business for the future
Our FY24 commitments:
〉 Develop and pursue opportunities to optimise our portfolio.
Progress during FY24:
(3) Refer to market release "Sale of Illawarra Metallurgical Coal" dated 29 February 2024.
(4) Refer to media release "Agreement to Divest Interest in Eagle Downs" dated 12 February 2024.
(5) Refer to media release "Agreement to Divest Metalloys Manganese Alloy Smelter" dated 13 June 2024.
(6) Illustrative FY24 Group Underlying revenue. Presented on a proportional consolidation basis and excludes Illawarra Metallurgical Coal, third party product revenue and Group
and unallocated items/eliminations.
In addition to making a final investment decision for the Taylor
deposit at the Hermosa project, we have made other substantial
changes to our portfolio in FY24.
In February 2024 we entered into an agreement to sell Illawarra
Metallurgical Coal for up to US$1.65 billion
(3)
. The agreement
became unconditional on 29 July 2024 and is expected to
complete on 29 August 2024. The transaction will simplify
our business, strengthen our balance sheet and reduce our
capital intensity, unlocking capital to invest in our high-quality
development projects in copper and zinc.
We entered into an agreement to sell our 50 per cent interest
in the Eagle Downs metallurgical coal project, for upfront
consideration of US$15 million, a contingent payment of
US$20 million and a price-linked royalty of up to US$100 million
(4)
.
The transaction completed on 12 August 2024.
We also entered into a binding agreement to sell the Metalloys
manganese alloy smelter
(5)
, with the transaction expected to
complete in the second half of FY25 subject to the satisfaction of
certain conditions.
With these changes, our exposure to commodities critical
for a low-carbon future will be approximately 90 per cent of
Underlying revenue
(6)
. We have added copper and doubled our
low-carbon aluminium capacity since inception, we have exited
lower returning, capital intensive businesses, and we are growing
our zinc and copper volumes through high-quality development
projects.
We have also been active in greenfield exploration in FY24, with
partnerships and prospects in six countries. We have consolidated
our position in the San Juan region of Argentina by increasing our
interest in Aldebaran Resources Inc. to 14.8 per cent, which has
an earn-in to acquire an 80 per cent interest in the Altar copper
project, and by acquiring a 50.1 per cent interest and operatorship
of the Chita Valley copper exploration project. We also completed
a first-time exploration drilling program at our 100 per cent owned
Roosevelt project in Alaska, and extended our strategic alliance
with AusQuest, which is focused on developing high-potential
exploration opportunities in Australia, for a further two years.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
25
SOUTH 32 ANNUAL REPORT 2024
Our strategy in action > Key performance indicators
A BALANCED APPROACH
TO MEASURING
OUR PERFORMANCE
FINANCIAL
Why it matters Performance in FY24
Production
Copper equivalent production (kt)
(1)
1,118
FY23: 1,206
FY22: 1,124
Provides a baseline to easily
benchmark our production
performance against other mining
and metals companies.
Achieved 98 per cent of revised
FY24 copper equivalent production
guidance, with two annual production
records offset by weather and other
operational impacts.
Capital expenditure
Investment (US$M)
(2)
1,409
FY23: 1,177
FY22: 723
Measures our approach to investing
in safe and reliable operations,
improvements and life extensions, and
growth options.
Increased our investment in
productivity and improvement
projects and our high-quality
development projects in base metals.
Earnings
Underlying EBITDA (US$M)
1,802
FY23: 2,534
FY22: 4,755
Underlying measures of earnings are
important when assessing underlying
financial and operating performance.
Lower commodity prices and
production volumes, primarily at
Illawarra Metallurgical Coal and
Australia Manganese, more than offset
a reduction in our cost base.
Cash flow
Free cash flow from operations
(US$M)
(80)
FY23: 57
FY22: 2,240
Cash flow measures are important
when assessing underlying financial
and operating performance.
Following a challenging first half,
strong cash generation in the second
half of the year was supported by
improved operating performance,
higher commodity prices and an
unwind of working capital.
Shareholders
Shareholder returns (US$M)
(3)
198
FY23: 1,225
FY22: 788
Provides an indicator for shareholders
of how well their investment is
performing.
We returned US$163 million via
fully-franked ordinary dividends and
US$35 million via our on-market
share buy-back, while managing our
financial position and retaining the
right balance of flexibility, efficiency
and prudence.
(1) Copper equivalent production was calculated using FY23 realised prices.
(2) Comprises Capital expenditure, capitalised exploration and evaluation expenditure 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.
(3) Fully-franked ordinary dividends paid in respect of H2 FY23 (US$145M), fully-franked ordinary dividends paid in respect of H1 FY24 (US$18M) and on-market share buy-back
(US$35M).
26
SOUTH 32 ANNUAL REPORT 2024
SUSTAINABILITY
Why it matters Performance in FY24
Health and safety
Lost time injury frequency
(per million hours worked)
(4)
1.9
FY23: 1.6
(5)
FY22: 2.0
Nothing is more important than the
health, safety and wellbeing of our
people.
LTIF increased by 19 per cent year-
on-year, mostly driven by an increase
in lost time injuries at our Australian
operations.
People
Employee engagement (per cent)
(6)
81
FY23: 80
FY22: 80
Engaging directly with our people
allows us to understand how they
experience all aspects of South32 and
identify areas for improvement.
Our employee engagement score, as
measured in our Your Voice employee
survey, improved by one percentage
point year-on-year.
Community
Social investment (US$M)
23.6
FY23: 27.7
FY22: 31.1
We invest in local communities with
the aim of contributing meaningfully
to their social and economic
development.
Social investment plans were
implemented on time and on budget.
Environment
Operational water efficiency
(per cent)
(7)
68.4
FY23: 67.8
FY22: - (data not collected)
Water is a vital shared resource and a
critical input for our operations.
Our operational water efficiency
increased year-on-year,
demonstrating overall improved
management of water resources.
Climate change
Operational greenhouse gas
emissions (Mt CO
2
-e)
20.3
FY23: 21.7
(8)
FY22: 22.0
(8)
Human activity is causing climate
change and the impacts are affecting
ecosystems, biodiversity, and
communities around the world.
Our reported Scope 1 and Scope 2
greenhouse gas emissions decreased
by six per cent year-on-year, with
Scope 1 emissions decreasing by
0.9 Mt CO
2
-e and Scope 2 emissions
decreasing by 0.5 Mt CO
2
-e.
(4) Frequency rates are per million hours worked. Incidents are included where South32 controls the work location or controls the work activity.
(5) In FY24, seven injuries which occurred in FY23 have been reclassified from restricted work cases to lost time cases, resulting in an increase in LTIF from 1.4 to 1.6.
(6) Given the agreement to sell Illawarra Metallurgical Coal and focus on recovery efforts following Tropical Cyclone Megan at Australia Manganese, employees at these operations
did not participate in this year’s Your Voice employee survey. Survey results presented in this report are calculated on re-baselined data to support year-on-year comparison
against the same operations in scope.
(7) Percentage of water used for operational activities which is reused/recycled water.
(8) In FY24, Illawarra Metallurgical Coal transitioned its greenhouse gas emissions reporting methodology from Continuous Emissions Monitoring to Periodic Emissions
Monitoring, resulting in historical greenhouse gas emissions being revised.
KEY
Strategy pillar Sustainability pillar Strategic risks Remuneration
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
27
SOUTH 32 ANNUAL REPORT 2024
MANAGING OUR RISKS
TO PROTECT AND
UNLOCK VALUE
Our approach to risk management is
governed by our risk management
framework, which is defined in our risk
management policy, and delivered
through our system of risk management.
Our internal risk management standard
outlines the minimum mandatory
requirements for the management of
risks that can materially impact our
ability to achieve our purpose, strategy
and business plans. Our system of risk
management is aligned to the principles
of the International Standard for Risk
Management AS/NZS ISO 31000:2018. Our
approach to risk management applies to
all employees, directors and contractors of
South32. Our risks are regularly assessed
and managed at both a company-wide
strategic level and at a tactical level for
operation, project and function risks.
Our risk assessment criteria consider the
potential impact of a risk event both on
our own business and people, as well as
the potential impact on others, such as
our local communities, and impacts on the
environment.
Risk appetite
Risk appetite is the level of residual risk
that we are willing to take in pursuit of our
strategic objectives, which is established
in relation to our operating environment.
Our Board considers and approves the risk
appetite developed by management. Our
internal Risk Appetite Statements outline
the extent to which we are or are not
willing to engage with higher levels of risk
(both threats and opportunities) in order
to realise greater benefit in the pursuit of
our purpose and strategy and in alignment
with our values and Code of Business
Conduct. The Risk and Audit Committee
reviews any significant changes to
material and strategic risks identified by
management (including new and emerging
risks) and considers whether they remain
within the risk appetite. Key risk indicators
(KRIs) are set by management and used
to monitor performance against our set
risk appetite. Understanding our risk
appetite across our strategic risks assists
in decision-making across the Group.
Material risks
We apply the three lines operating model
to our system of risk management, which
determines how our structures, processes,
and organisational roles work together
to facilitate strong risk management
and assurance. This approach is used to
manage our material risks and enables
us to:
– Provide stable and consistent
processes, tools and routines to
identify and regularly assess the most
impactful threats and opportunities;
– Deliver predictable outcomes and
prevent unforeseen events with
material impacts;
– Understand our risks and manage
these at all levels of the organisation;
and
– Reduce or seek to eliminate risks where
appropriate or improve our processes
using a risk-based approach.
Our material risks are those which can
materially impact our ability to achieve
our purpose, strategy and business
plans. The effective management of our
material risks is routinely assessed by
our Lead Team. An overview of these
risks are reviewed by our Risk and Audit
Committee and Sustainability Committee,
which assist our Board to carry out its
role of overseeing our risk management
and assurance practices. We report
transparent real-time risk data through
our risk management tool, Global360. This
software connects data relating to the
management of our risks, interactions,
events, hazards and assurance actions.
Aside from helping us manage our
business, reliable data on material risks
contributes towards the monitoring and
management of our strategic risks. This
provides insight into trends and emerging
themes that can trigger a review of our
business plans or inform a change in
strategic direction.
Strategic risks
Our strategic risks are risks which can
affect our ability to achieve our strategic
objectives. They have the capacity to
affect all, or a significant part, of our
organisation and therefore tend to have
significant impacts, both negative and
positive. With that in mind, our strategic
risks, associated KRIs and management
responses are monitored over the course
of the year, with formal evaluation and
reporting to the Board twice per year. The
review process is informed by external and
internal events that could have a potential
impact on our organisation, as well as
emerging themes across our material
risks. In FY24, we identified 13 strategic
risks each of which is explained further in
subsequent pages.
FY24 Risk exposure trend key
The inherent risk impact or
likelihood has increased over
the past 12 months (i.e. without
considering internal controls or
management responses).
The inherent risk impact or
likelihood has not changed
significantly over the past 12
months (i.e. without considering
internal controls or management
responses).
The inherent risk impact or
likelihood has decreased over
the past 12 months (i.e. without
considering internal controls or
management responses).
Risk management is fundamental to maximising the value of our business and informing its strategic
direction. Effective risk management enables us to identify priorities, allocate resources, demonstrate
due diligence in discharging legal and regulatory obligations, and meet the standards and expectations
of our stakeholders.
Risk management
28
SOUTH 32 ANNUAL REPORT 2024
Keeping our people safe and well
A safe and healthy working environment is fundamental to living
our values.
FY24 Risk exposure trend
There have been positive signs of the desired shifts in our
lead safety indicators across FY24. Our operations have
sustained or improved leadership time in field
(1)
, as well as
sustaining the reporting frequency of hazards and near
misses. We continue to embed measures to promote
chronic unease and to inform actions to further drive our
safety culture transformation, including a deliberate focus
on fatality elimination.
Risk appetite
Aligned to our purpose and values, we will not take actions that
compromise the health, safety and wellbeing of our people,
contractors and communities.
Opportunities
Keeping our people safe and well underpins the culture we aspire
to and sets our expectations of each other.
Threats
The impact of not having a safe working environment can be
devastating for our employees, contractors and communities.
It can alter lives and impact shareholder returns, stakeholder
confidence and ultimately our licence to operate.
Our response includes:
– In everything we do, we focus on the health, safety and
wellbeing of our people, contractors and communities;
– We have a system of risk management and comprehensive
internal health and safety policies, standards and systems with
associated performance requirements designed to prevent
and mitigate potential exposure to health and safety risks;
– We value and strive to build inclusion and diversity in our
workplace where everyone is valued and can participate to
achieve their full potential. We do not tolerate any form of
inappropriate conduct which includes bullying, harassment,
discrimination or victimisation;
– We aim to eliminate or minimise psychosocial hazards across
our workplaces. We have progressed the development of
our new global psychosocial risk framework which aims to
standardise the way that we identify, assess, and mitigate
psychosocial risks across our business;
– We engage, develop and train our people so that our work is
well designed and executed;
– We investigate actual and potential significant events that could
have led to severe injury or higher outcomes, put controls in
place and share the learnings across our organisation;
– We continuously improve our work environment with the aim of
making it safer, healthier and more productive for our people.
We are implementing our multi-year Group-wide Safety
Improvement Program designed with the aim of enhancing
our safety culture and by changing mindsets and behaviours,
achieving a step change in our safety performance; and
– In line with the three lines operating model, we have assurance
functions independent of our operating activities that provide
assurance against our own comprehensive internal standards.
+
Learn more about our approach to health and safety in our
Sustainable Development Report 2024 at www.south32.net.
(1) In this context “leadership time in field” means, a common core routine undertaken when leaders engage in the workplace.
(2) Determined by reference to the Fraser Institute Annual Survey of Mining Companies 2023.
Portfolio reshaping
Our objective is to improve our return on invested capital and
create shareholder value by increasing our exposure to high-
quality operations in commodities with a strong and sustainable
outlook, in jurisdictions where we believe we can operate in line
with our values and Code of Business Conduct.
FY24 Risk exposure trend
Consistent with the prior year, a constructive mid/long
term outlook for commodities critical for a low-carbon
future continues to drive competition for development
and operating assets in developed and/or low risk
jurisdictions
(2)
, with a scarcity of assets for sale.
Risk appetite
We accept that in actively transforming our portfolio, we need
to take risk to capture opportunities. We will seek to do so in
jurisdictions and commodities where we believe we can operate
or invest in line with our values and Code of Business Conduct.
Opportunities
Increasing our exposure to commodities critical to a low-
carbon future will position our business for a low-carbon future,
in alignment with our strategy. Acquisitions of operations
or development options (including non-operating and non-
controlling shares in these operations and development options)
present us with opportunities to create shareholder value through
increasing our exposure to these commodities. Partnering with
junior explorers also creates opportunities for us in early-stage
exploration in more challenging jurisdictions where we are not
able to leverage our existing operating capabilities.
Threats
Increasing demand for commodities critical to a low-carbon
future may drive higher valuations of acquisition targets, making
acquisitions challenging and potentially value destructive. A
scarcity of assets for sale that meet our strategic objectives
(including commodity, asset quality and jurisdiction) at attractive
valuations or a reliance on exploration to fill our pipeline of
opportunities may impact the pace of transition. Geopolitical
developments may also limit those jurisdictions in which we can
operate or those counterparties with which we can partner or
transact.
Our response includes
– We are actively reshaping our portfolio towards commodities
critical to a low-carbon future;
– We take more risk on early-stage exploration projects,
including jurisdictional risk as well as through joint ventures
and earn-ins, but commensurate with the commercial
exposure;
– We will be flexible on opportunistic acquisitions including non-
controlling and non-operating shareholdings in incorporated or
unincorporated joint ventures; and
– We carry out an annual review of commodity prices and
exchange rates, to develop long-term views for our portfolio
commodities and foreign exchange rates for the jurisdictions
where we operate. This process is supplemented by tri-annual
updates.
+
Learn more about how we are reshaping our portfolio in Our
strategy in action on page 25.
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Risk management continued
Climate Change and environment
Climate change poses physical risks to our business, our people
and the infrastructure, communities, environment and value
chain on which we rely. The political, social and economic
responses to the challenges posed by climate change and the
transition to a low-carbon economy also pose transition risks
to our business performance (i.e. demand for some of our
commodities, cost and profit margins, social licence, regulatory
exposure, and affordability of secure low-carbon energy and
decarbonisation technology). Learn more about our approach to
climate change, including our detailed assessment of the risks
climate change poses to our business, in the Addressing Climate
Change section of our Sustainable Development Report 2024 and
our Climate Change Action Plan (CCAP), both of which available at
www.south32.net.
We recognise that our operations, people and communities are
dependent on healthy functioning ecosystems. For example,
water scarcity, increased competition for water resources
or increased costs to access water supply can impact our
operations, supply chains and communities. Our operations also
have the potential to impact biodiversity, air quality and land and
water resources. This may result in increased costs to mitigate
or address such impacts, prevent or delay project approvals, and
could cause reputational damage.
FY24 Risk exposure trend
Stakeholder demands and regulatory mechanisms for
climate change mitigation and adaptation as well as
environmental management continued to increase during
FY24. Ongoing technological and commercial uncertainty
in decarbonisation solutions is influencing energy supply
certainty. As Earth’s climate changes, the frequency
and intensity of extreme weather events is expected to
increase, ranging from fire and drought to floods and
landslides.
Risk appetite
We recognise the impact our operations have on the environment
due to the extractive nature of our activities and that the
greenhouse gas emissions associated with our activities
contribute to climate change. We also recognise the role our
industry plays in providing the materials that are essential in the
transition to a low-carbon world and in supporting actions to
limit biodiversity loss. We acknowledge that we have potential
vulnerabilities to the physical impacts of climate change and
exposure to other climate and environment-related risks. We
accept that we need to take risks in order to minimise our
environmental impact and reduce our exposure to physical and
transition climate change risk and environment-related risk. We
seek to take considered risks that may arise as we transform our
portfolio to maintain competitiveness in a low-carbon world and
pursue our greenhouse gas emissions reduction target and goals.
Opportunities
Aligning our business strategy, including how we operate
and what we produce, with stakeholder expectations, future
technologies and evolving climate and environmental policies
and regulations, contributes to a resilient and high performing
portfolio. We aim to increase the efficiency of our operations and
support business continuity through responsibly assessing and
addressing our climate change and environment-related risks,
dependencies and impacts, and increasing the resilience of our
business, our value chain and communities in which we operate.
We aim to collaborate with customers, suppliers, communities,
governments, technology innovators and industry to support the
delivery of our climate change and environment ambitions.
Threats
The complex and pervasive nature of climate change means that
climate and environment-related risks are reflected across our
risk profile. For further details on the potential impacts of climate
change on our strategic risks, refer to the Addressing Climate
Change section of our Sustainable Development Report 2024 and
pages 99 to 101 of our CCAP.
Failure to manage climate and environment-related risks may
impact our ability to secure development approvals, permits
or licences and increase our legal exposures. It may also limit
our ability to access capital, insurances and low-carbon energy,
develop strategic partnerships with Indigenous, Traditional and
Tribal Peoples or environmental organisations, attract and retain
employees, deliver our project portfolio, and grow our business in
existing and new jurisdictions.
Our response includes:
– Our approach to managing the transition and physical risks of
climate change is outlined in the Addressing Climate Change
section of our Sustainable Development Report and our CCAP;
– Our sustainability approach, inclusive of our environmental
performance requirements, is guided by the ICMM Mining
Principles, United Nations Global Compact (UNGC) Ten
Principles and United Nations Sustainable Development Goals
and is outlined in our Sustainability Policy and Sustainable
Development Report 2024 at www.south32.net;
– We seek to manage water resources using a holistic approach
to promote better water use, effective catchment management
and to contribute to improved water security and sanitation;
– We establish contextual water targets for operations exposed
to water-related material risks with consideration for broader
stakeholder and catchment needs;
– Our approach to biodiversity conservation addresses
biodiversity impacts with a focus on minimising our operational
impacts through application of the biodiversity mitigation
hierarchy and collaborating with others to contribute towards
biodiversity conservation and restoration;
– We aim to achieve no net loss outcomes for all new projects
and major expansions to existing projects through a balanced
application of the biodiversity mitigation hierarchy of
avoidance, minimisation, rehabilitation and offsetting;
– We integrate land management and rehabilitation processes
into our business planning and give consideration to
cumulative impacts when developing management controls to
minimise impacts on surrounding ecosystems;
– We manage our waste streams to minimise environmental
impact and realise value through a balanced application of the
waste mitigation hierarchy of prevention, minimisation, reuse,
recycle, energy recovery and disposal;
– We engage regularly with investors, governments, industry
partners, membership-based sustainability organisations,
environmental, social, and governance (ESG) proxy advisers
and ESG activist groups to identify and monitor emerging
environmental, nature and climate change risks, opportunities
and trends; and
– We are transparent in our disclosure of environment and
climate-related opportunities and threats in our annual
reporting, in accordance with the Global Reporting Initiative
(GRI) Sustainability Reporting Standards and recommendations
of the Task Force on Climate-related Financial Disclosures.
+
Learn more about how we are addressing climate change and
managing our environmental impact in our Sustainable
Development Report 2024 at www.south32.net.
30
SOUTH 32 ANNUAL REPORT 2024
Maintain, realise or enhance the value
of our Mineral Resources and Ore Reserves
We intend to realise the potential of the resources and reserves
we are entrusted to develop. We work to continually optimise our
operations through sound technical and economic understanding
of our resources and reserves.
FY24 Risk exposure trend
Factors across FY24 influencing value at risk within our
life of operations plans include production complexity,
extreme weather events, commodity market structural
changes and approval delays for specific operations.
However, our approved development path activities
remain on track from FY23.
Risk appetite
We are not willing to take risks that inhibit our ability to realise
the potential of the resources and reserves we are entrusted to
develop.
Opportunities
We continue to enhance our understanding of our resources and
reserves. We leverage this enhanced understanding through
the annual planning cycle to define and assess additional
opportunities to add value to our business.
Threats
If we fail to continually optimise our operations and projects, it
will have a significant impact on shareholder returns, the benefits
our stakeholders receive and ultimately, the sustainability of the
company.
Our response includes:
– We have capital prioritisation, capital allocation and planning
processes which prioritise the highest-value options across our
portfolio;
– We apply an annual planning process, that considers the
impact of ESG related matters on our Ore Reserves, with
plans structured to maximise value throughout the life of our
operations;
– Drill plans and budgets are approved as part of our annual
planning cycle and compliance to those plans is reported
monthly. Where there is material deviation to plan, actions are
taken to get us back on track;
– We apply a rigorous project development process that
includes independent peer review of project risks and approval
tollgates;
– We report Mineral Resources and Ore Reserves (including Coal
Resources and Coal Reserves) in accordance with the JORC
Code as required in Chapter 5 of the ASX Listing Rules; and
– We have an internal closure standard which requires that
our full life of operations value incorporates closure and
rehabilitation liabilities.
+
Learn more about resources and reserves on page 178.
Major external events or natural catastrophes
Our operations and logistics networks can be disrupted by events
such as pandemics, natural disasters and extreme weather
events that could impact people’s safety, wellbeing, security,
the integrity of tailings storage facilities and key operating
infrastructure.
FY24 Risk exposure trend
In Australia across the mining industry, intense climatic
events, ranging from fire and floods to cyclone-driven
extreme rains, affected mining activities leading to the
temporary suspension of operations. For South32 heavy
rain, causing floods, directly impacted both Australia
Manganese and Cannington in FY24.
Risk appetite
We are not willing to take risks that compromise our ability to
manage natural catastrophes. However, we accept we operate
in a diverse range of geographic locations, which are exposed to
natural events and other external events.
Opportunities
Achieving stable and predictable performance enhances the
value proposition to our shareholders, stakeholders and the
communities in which we operate. The better we prepare for, learn
and improve from events, the better we are placed to respond
and aim to reduce the impact of future events – strengthening
our organisational resilience.
Threats
Failure to manage major events or natural catastrophes could
result in a significant event or other long-term damage that could
harm the company’s access to logistics chains and critical goods
and services, operational and financial performance, and licence
to operate. The role of climate change in increasing the frequency
and severity of natural catastrophes is addressed under ‘Climate
change and environment’ on page 30.
Our response includes:
– When facing potential catastrophes, we put safety and
wellbeing at the heart of everything we do;
– We use our system of risk management in design, construction
and operation phases to analyse risks, and design and
implement actions that aim to prevent or limit business
impacts;
– We utilise climate modelling data to inform our long-term plans
and project pipelines, and conduct physical risk assessments
of our assets every two years;
– We have business continuity and disaster response plans
in place with trigger action response scenarios to facilitate
a rapid response to major events and safely restore our
operations, with the aim of protecting the health and safety of
our people and the communities in which we operate;
– Consistent with the three lines operating model, we have
assurance functions independent of our operating activities
that provide assurance against our own comprehensive
internal standards including equipment integrity, tailings
management and technical stewardship. Where relevant,
we work with external experts, relevant industry bodies and
technology suppliers, to provide additional assurance and
input; and
– We purchase insurance coverage against many, but not all,
potential losses or liabilities arising from major events or
natural catastrophes. This coverage has a deductible cost to
the company and limits that mean full financial coverage will
not be achieved.
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SOUTH 32 ANNUAL REPORT 2024
Risk management continued
Maintain competitiveness through technology and innovation
Technology and innovation are advancing at a rapid pace.
Companies unable to effectively leverage technology and
innovation may find themselves failing to deliver against
shareholder expectations on returns, unable to attract and
retain talent or, in the example of decarbonisation, failing to
maintain licence to operate. Cyber incidents are becoming more
sophisticated and targeting third party suppliers with weaker
controls to infiltrate larger organisations.
FY24 Risk exposure trend
We continue to see cyberattacks targeting operational
technology systems, including those used by mining
companies. There has been an increase in hackers
targeting personally identifiable information held by third
party suppliers and vendors with immature cyber controls.
The adoption of artificial intelligence (AI), including new
developments in generative AI, has ‘step-changed’ from
previous years and is increasing rapidly across various
industries. These rapid developments present both
opportunities and risks to our business.
Risk appetite
We are not willing to take risks that will result in a loss of data
or disruptions to our operations and projects due to the theft,
disclosure or corruption of information. Aligned to our strategy,
we will pursue technology and innovation that may have a lower
certainty of success where there is commensurate potential for
high return on investment.
Opportunities
To stay competitive, we position our organisation to effectively
identify, develop and adopt sustainable business models,
technologies, AI and innovation in our operations and projects.
Priority innovation opportunities are identified and delivered
through Innovate32, our strategy-aligned, value-focused,
innovation portfolio. This approach will assist us to deliver on
shareholder return expectations and position us for future
business opportunities.
Threats
Failure to keep pace with, and leverage advances in, technology
and innovation could result in reduced shareholder returns and
impact our licence to operate. Failure to adopt automation,
electrification, AI and digital systems could result in deteriorating
performance across safety, productivity, returns and greenhouse
gas emissions. Cybersecurity incidents could pose multiple
risks including disruption to new projects and operations, theft,
disclosure or corruption of information.
Our response includes:
– We actively manage cybersecurity, privacy and loss of critical
systems risks through our system of risk management;
– We have developed our cybersecurity strategy and risk
controls aligned to the National Institute of Standards and
Technology cybersecurity framework;
– We have developed standards, procedures and implemented
tools to proactively manage our cybersecurity and privacy
controls;
– We have a clearly defined approach to innovation,
improvement and technology;
– We deliver specific programs focused on adoption and
improvement of critical technology capabilities across multiple
time horizons;
– We have a value-based ‘portfolio’ approach to testing and
scaling up innovation across the company;
– We have rigorous internal technology standards and
processes;
– We benchmark our digital technology performance against
industry best practice and coordinate and integrate
technology advances into our growth portfolio; and
– We monitor internal customer satisfaction and manage
customer support.
+
Learn more about how technology and innovation are
unlocking value in Our strategy in action on page 22.
32
SOUTH 32 ANNUAL REPORT 2024
Predictable operational performance
Loss of predictable operational performance will prevent us
from reliably delivering on our strategic objectives. We build
resilience and predictability into our business by sustaining our
ability to keep our people safe and well, effectively managing our
assets, meeting our regulatory and social obligations, managing
cost inflation and consistently delivering quality products to our
customers.
FY24 Risk exposure trend
Over the past year we have experienced both internal
and external events that have impacted predictable
operational performance. While external risks associated
with extreme weather, energy supply, social and labour
unrest remain elevated, our exposure trend remains
neutral relative to recent years. Focus remains on
mitigating our external risk exposure while directly
addressing the root causes of internal production variation
with continued improvement of our management systems.
Risk appetite
We are not willing to take risks that compromise the stable and
predictable performance of our operations.
Opportunities
We mature our management systems to control and continuously
improve our operations and processes, so that we can deliver
stable and predictable performance and unlock the full value of
our business. We invest in our operations to sustain and improve
production capacity that generates reliable cash flow to deliver on
our strategic objectives.
Threats
External volatility and challenges can impact predictable
performance. These include extreme weather events, labour
and supply chain tightness as well as regulatory and geopolitical
change. If we are unable to safely and consistently achieve our
production, cash flow or profitability targets, it could negatively
impact our ability to deliver on our strategic objectives and
negatively impact shareholder returns.
Our response includes:
– We have embedded, and continuously verify and improve our
safety and risk management systems across our business;
– We have an effective asset management system in place at
each operation and review our asset health, asset integrity and
capital investments on a regular basis;
– We actively verify and improve the effectiveness of our
Operating System by embedding our operating practices
including operational planning, execution, review and
improvement;
– We actively manage risks to our resources and reserves,
mine and operational planning including reconciliation of Ore
Reserves to production, plan and spatial compliance and
management of geotechnical risks;
– We manage an integrated system of long to short-term planning,
scheduling and budget forecasting processes that considers ESG
themes and optimises the value from our resources;
– We actively manage product delivery and supply chain risks
including effective sales and operational planning processes,
monitoring of raw material supply and management of target
inventory operating windows; and
– We carry out rigorous quality assurance programs over our
products and operations.
+
Learn more about our operational performance in Our strategy
in action on page 21.
Delivery of our project portfolio
Delivery of our project portfolio, both brownfield and greenfield,
forms a critical component of our strategy. Delivery of projects
safely, on schedule and within budget allows us to optimise and
unlock the value of our business.
FY24 Risk exposure trend
Approvals and permitting delays, project cost inflation and
constraining market drivers continue to impact project
timelines. Skilled labour shortages, wage and material cost
escalation, as well as supply chain constraints continue to
apply pressure on contract pricing and project investment
risk in the markets where we execute our projects.
Risk appetite
Aligned to our strategy of unlocking value in our business, we will
not take actions that compromise the planning and execution of
our major projects. However, we may accept greater levels of risk
to pursue opportunities to extend the life of existing operations
through brownfield projects and in executing decarbonisation
projects for our assets.
Opportunities
Delivery of our project portfolio on time and within budget allows
us to improve reliability, complement our existing assets, extend
the life of our operations, realise our external commitments and
grow volumes into structurally attractive markets.
Threats
Inability to deliver the project pipeline may impact on our future
cash flows, reputation and return on investments. Known and
emerging uncertainties that may challenge the timely and
successful execution of our projects can include regulatory
approval timeframes, permitting delays, supply chain disruptions,
high inflation, joint venture partner misalignment, and activism.
Our response includes:
– Our internal investment framework defines a tollgate process
with an independent peer review mechanism to inform key
investment decisions;
– Our project management framework supports disciplined
project development and delivery;
– We maintain a life of operation annual planning process. By
evaluating the embedded project options in our operations, we
look to optimise value throughout the life of our operations;
– We have developed our Operating System for major projects,
and are maturing our performance in delivering projects on
cost and on schedule;
– Our joint venture agreements include mechanisms such as
technical committees and collaborative reviews to influence
project, schedule and cost outcomes;
– We apply a standardised valuation methodology with
consistent key macroeconomic assumptions; and
– We conduct an annual review of commodity prices and
exchange rates which informs our project budgets. This
process is supplemented by tri-annual updates.
+
Learn more about our project execution in Our strategy in
action on page 23.
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SOUTH 32 ANNUAL REPORT 2024
Risk management continued
Supply chain security
The inability to procure critical goods and services, such as
raw materials, energy, water, gas, equipment and spare parts,
consumables, technology, corporate services, labour and
logistics, has the potential to impact business performance and
our strategic objectives.
The procurement of critical goods and services must be
undertaken in a manner that aligns to our purpose and values,
meets stakeholder expectations and adheres to the policies and
regulations where we operate. This includes sustainable sourcing
and supporting local communities.
The security of our supply chain is heavily impacted by
pandemics, jurisdictional unrest, geopolitical tensions, climate
change, and a shift from globalism towards protectionism.
FY24 Risk exposure trend
We have seen an increase in levels of global conflict and
geopolitical tension, as well as increases in the frequency
and intensity of climatic events, resulting in increased
protectionism and supply chain regionalisation.
Risk appetite
Aligned to our strategy of optimising our business, we are not
willing to take undue risks that compromise the security of our
supply chain. However, we accept that we have a strong reliance
on certain critical suppliers, particularly to provide energy,
logistics, and raw materials to our operations and we have limited
ability to reduce this reliance.
Opportunities
Optimal and sustainable management of supply chain risk
positions our business to operate safely and reliably, at the
lowest possible cost and in a manner that meets or exceeds
the expectations of our stakeholders. It also provides us with
the ability to influence how others in our industry approach
sustainable sourcing and to position us to benefit as trade flows
respond to rising protectionism, social consciousness, and
general trends to de-risk supply chains.
Threats
Disruption of our supply chain could materially impact our ability
to deliver on our commitments and meet the expectations of
our stakeholders. The global energy transition is increasing the
complexity of our energy procurement activity. Failure to meet
minimum ethical supply chain standards has the potential to
damage our social licence to operate (this is further addressed
under ‘Evolving societal expectations’ on page 36). Climate
change has the potential to increase the frequency and severity
of extreme weather events which may threaten our supply
chains, particularly logistics and the availability of critical goods
and services (this is addressed under ‘Climate change and
environment’ on page 30, and in the Addressing Climate Change
section of our Sustainable Development Report 2024).
Our response includes:
– We understand, assess and continually monitor the risks in our
supply chains through an integrated system that considers the
value of critical goods and services. This includes risks relating
to potential shortages, critical suppliers and categories,
vendor liquidity, logistics, climate change and decarbonisation,
and modern slavery;
– Internal and external data is integrated so we have a good
understanding of existing and emerging risks and can take
action to mitigate;
– We use our understanding of risk to deploy controls to support
predictable operations. This includes working closely with our
vendors and operations to match availability with demand;
understanding options for alternative sources of supply and
implementing multi-source supply where required; optimising
inventory levels; flexing commercial terms and maintaining
up-to-date business continuity plans. We continually optimise
our approach between ‘just in case’ and ‘just in time’ as supply
chain risk ebbs and flows;
– We build strong strategic partnerships with key suppliers and
customers on a long-term, mutually beneficial basis;
– We have a clearly defined transformation strategy and
Enterprise Supplier Development program in South Africa
aimed at building and growing small, medium and micro
enterprises;
– We have Reconciliation Action Plan targets to develop and
support Aboriginal and Torres Strait Islander enterprises in
Australia;
– We have local procurement initiatives designed to increase
opportunities for local suppliers;
– We actively review and manage payment terms to support
small and local businesses in all jurisdictions in which we
operate; and
– We have an established process to assess and mitigate
potential modern slavery risks.
+
Learn more about our responsible supply chain activities in our
Sustainable Development Report 2024 at www.south32.net.
34
SOUTH 32 ANNUAL REPORT 2024
Shaping our culture and managing diverse talent
We must actively shape and embed our culture to attract,
develop, support, and retain our talented people to deliver a safe
and sustainable business. To align with the evolving needs of our
people, business, and broader stakeholders, we continuously
monitor our culture and seek feedback to enhance the employee
experience.
FY24 Risk exposure trend
Internal feedback and data suggests improvements in
employee experience and a reduction in attrition risk,
coupled with the expectation that global unemployment
rates are expected to hold steady in the near term.
Risk appetite
People underpin everything we do and we are not willing to
take risks that could negatively impact our culture and the way
our people connect to our purpose. However, we recognise our
size and the competitive labour market in which we operate
and therefore must be willing to take risk to build our talent and
succession pipeline.
Opportunities
By shaping and embedding our culture through our systems,
symbols, and behaviours, we will maintain an employee
experience that engages all our people to better deliver our
strategic objectives, together.
Threats
If we are unable to embed our preferred culture, we will likely
have lower levels of engagement, disconnected teams that
lack diversity and operate in silos, and relationship rather than
performance-based decision making. Over time, this may
constrain innovative thinking and impact our ability to attract
and retain talent, which may lead to significant shareholder value
erosion and reputational damage.
Our response includes:
– Our Code of Business Conduct sets out our expected
standards of workplace behaviours which inform our culture.
Formal training and assessment routines are in place to
educate, reinforce, and assess understanding in our people.
Anyone can report a business conduct concern, anonymously
if preferred, or by using our confidential and independently
administered reporting hotline;
– We measure and discuss culture using a Culture Tensions
framing model. This process acts as a health check and allows
us to assess positive or negative change and test whether
we are making progress towards our preferred culture that
better balances relationships with performance, systems and
processes with innovation and empowerment;
– We measure our employee experience, including at
onboarding, annually through our ‘Your Voice’ employee
survey, and at exit. The Your Voice survey responses are
shared with line leaders to enable team-based conversations
that directly empower improvements to the local employee
experience;
– We have an Inclusion and Diversity Policy, internal inclusion
and diversity standard and a framework which sets out our
commitments, strategy, requirements, measurable objectives
and approach to performance reporting;
– We have a Leadership Model which strengthens alignment to
our preferred culture and behaviours, and is integrated across
our people systems and processes;
– We have a performance and goals process which supports
our reward philosophy, and recognises and rewards aligned
leadership behaviours and performance;
– We design our reward elements in accordance with our global
reward framework taking into consideration local labour
market practices, which enables us to attract appropriate skills
and experience, engage employees and improve performance;
– We routinely review our key talent and critical role successors
globally, creating individualised plans to further their
development and address talent pipeline risks as appropriate.
This includes targeted retention programs for key talent and/or
team members occupying critical roles;
– We support employees who undertake further education and
training related to their current or future career with South32;
and
– We have an internal flexible work procedure which empowers
our leaders to engage with their teams to determine the
ways of working that balance individual, team and business
requirements.
+
Learn more about our people and culture in our Sustainable
Development Report 2024 at www.south32.net.
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SOUTH 32 ANNUAL REPORT 2024
Risk management continued
Evolving societal expectations
The expectations of resources companies by employees,
governments, investors, lenders, host communities, customers,
non-governmental organisations and broader society continue to
evolve. To keep pace with these rapidly evolving expectations and
understand the potential impact to our business performance,
reputation and delivery of our strategic objectives, we maintain
an active stakeholder engagement program and undertake
external monitoring on a wide range of financial and ESG
issues, including climate change. We regularly engage with
our stakeholders to understand and respond to their views,
which may be divergent, and aim to identify ways we can create
enduring social, environmental and economic value, in a way that
aligns with our purpose and values.
FY24 Risk exposure trend
This risk is dynamic and expectations, sentiment and
standards continue to evolve broadly as anticipated based
on our active stakeholder engagement program and
external monitoring.
Risk appetite
We are not willing to take risks that will result in a failure to
meet societal expectations, in human rights, cultural heritage,
modern slavery and community safety. However, we accept that
we will be required to take some risks in areas such as impacts
of mining or minerals processing (e.g. on the environment) and
commodity selection that may not completely align with societal
expectations.
Opportunities
Proactive, collaborative and transparent engagement with our
stakeholders builds relationships based on trust and shared
understanding. Our ongoing licence to operate, and ability to
reshape our business for a low-carbon future, is built on our social
performance and contribution to our stakeholders and broader
society.
Threats
Failure to meet evolving societal expectations for ESG
performance could damage our reputation and negatively impact
our licence to operate, limiting our ability to access capital or
markets, retain and attract employees and grow our business in
existing and new jurisdictions.
Our response includes:
– Our purpose and strategy expressly balance economic
outcomes with social and environmental outcomes, now and
into the future. In the decisions we take, we look to minimise
impact, respect human rights and aim to create enduring
social, environmental and economic value for our stakeholders,
in a way that aligns with our purpose and values;
– We undertake internal and external stakeholder analysis and
engagement on a wide range of financial and ESG issues,
including an annual materiality process to understand
our material ESG issues. Our approach is aligned with the
ICMM Mining Principles, The UNGC Ten Principles and GRI
Sustainability Reporting Standards;
– We engage with our customers to understand their
requirements and drivers for responsible production, sourcing
and stewardship in the supply chain. We work with certification
bodies such as the Aluminium Stewardship Initiative to seek
certification against their performance standards to help
facilitate continued access to markets;
– We work to build strong, positive and meaningful relationships
with local communities. We regularly complete and review
community perception surveys, human rights impact
assessments, social baseline studies and social impact and
opportunity assessments to improve our understanding of the
communities in which we operate;
– We review and amend our social investment program annually
to align with community and stakeholder priorities. We
measure the outputs and outcomes of our social investments
as it informs future investment decisions and improves social
investment project design;
– We develop economic development plans at all our
operations which contribute to local and regional economic
development through employment, procurement and
business development. These plans include targets informed
by local context, including women and people with diverse
backgrounds;
– We engage with Indigenous, Traditional and Tribal Peoples
across our operations to build mutual understanding and
strengthen cultural heritage management. Our engagement
with Indigenous, Traditional and Tribal Peoples throughout
the life of our operations is sensitive to and respects cultural
protocols; and
– We participate in sustainability reporting transparency
initiatives and ESG rating agency reviews that assess and
score our performance.
+
Learn more about how we are delivering value to society in our
Sustainable Development Report 2024 at www.south32.net.
36
SOUTH 32 ANNUAL REPORT 2024
Political risks, actions by governments and/or authorities
Changes in legislation, regulation, policy and geopolitical
activity have the potential to impact our strategic objectives
and the way we work. This includes broader policy decisions
and regulatory changes, related but not limited to, changes to
royalty and taxation policy, nationalisation of mineral resources,
supply chains, renegotiation or nullification of contracts, leases,
permits or agreements, climate change and emissions reduction
requirements and environmental and social performance
requirements. We aim to effectively manage this uncertainty
through engagement with key stakeholders and industry
associations, monitoring of political activity, policy, legislative
and regulatory changes, and by having access to specialised
knowledge.
FY24 Risk exposure trend
Geopolitical volatility increased in FY24 through conflicts
in Ukraine and the Middle East, ongoing US-China
tensions, resulting in increased trade and domestic policy
targeting supply chain resilience. Increased geopolitical
risk is magnified through unstable policy environments
and misinformation risk as major economies conducted
elections in FY24. Tax authority activity has intensified,
with an increase experienced in tax audits and disputes.
Risk appetite
We have a low appetite for activities that are likely to result in
non-compliance with applicable legal or regulatory requirements.
We maintain programs that seek to comply with those
requirements. However, there can be no guarantee that such
programs will always be effective to identify or prevent breaches
of the law. Further, we operate in certain complex environments
and jurisdictions, which are subject to legislative, regulatory
or government policy changes that may adversely impact our
business. Therefore, there will always be residual risk in relation to
compliance with legal and regulatory requirements and changes
to those requirements that may adversely impact our business.
Opportunities
Proactive engagement leading to strong relationships with
governments and authorities provides a mutual understanding of
drivers for decision making. This increases clarity around policy
and regulatory environments, enables appropriate and tailored
responses to issues and provides investment certainty.
Threats
Legislation adverse to our business and regulatory or policy
decisions taken by governments or authorities, particularly
relating to societal expectations, can result in operational
disruption, permitting uncertainty, increases to our tax
obligations, affect future planning or lead to cessation of
operations or non-investment in operations or projects.
Our response includes:
– We have specialised knowledge through in-house expertise
or the use of external experts, including tax management
capability, tax advice and external affairs advice;
– We monitor political activity, policy, and legislative and
regulatory changes in the jurisdictions where we operate, and
we also engage with relevant authorities, to understand and
mitigate potential impacts on our business performance;
– We engage with key stakeholders in all jurisdictions where
we operate, in accordance with our stakeholder engagement
plans;
– We work through selected industry associations to influence
how the industry is positioned; and
– We produce an annual Tax Transparency and Payments
to Governments Report, which shows how we meet our
regulatory tax obligations.
+
Learn more about our approach to tax in our Tax Transparency
and Payments to Government Report 2024 at
www.south32.net.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
37
SOUTH 32 ANNUAL REPORT 2024
Global economic uncertainty and liquidity
We prioritise an investment grade credit rating and a disciplined
approach to allocating capital which aims to keep our balance
sheet strong, providing us with financial flexibility regardless
of market conditions. By creating competition for capital and
investing selectively in our existing operations, growth options
and external opportunities, or by making returns to shareholders,
we aim to maximise total shareholder returns over time.
FY24 Risk exposure trend
External market volatility is largely unchanged and the risk
of default of our investment grade bank counterparties
and customers remained stable in FY24.
Risk appetite
We are not willing to take risks that may limit our ability to
maintain a minimum liquidity balance and/or access to funding on
acceptable terms. We recognise our preferred commodity basket
and our operating costs have the potential for price and exchange
rate volatility outside of our control, and whilst we accept that as a
resource company we are exposed to this inherent risk, we will act
to reduce its impact by understanding its effect on our business.
Opportunities
By investing selectively in our existing operations and growth
options, external opportunities, or by making returns to
shareholders, we aim to maximise total shareholder returns over
time.
Threats
A significant or sharp deterioration in economic conditions can
adversely impact market demand, commodity prices, and/or
exchange rates which has the potential to significantly reduce
profitability, cash flow and returns to shareholders. An increase
in volatility, especially when it has an impact on in-bound and
out-bound supply chains, has the potential to increase working
capital requirements, affecting our liquidity. A reduction in
liquidity available in capital markets has the potential to impact
our balance sheet and ability to pursue our strategy.
Our response includes:
– We have a diverse portfolio of operations, commodities and
end markets which strengthens our resilience to the disruption
of any one commodity, geography or operation;
– We prioritise a strong balance sheet and an investment grade
credit rating, with the aim of remaining resilient through
economic cycles;
– We test our financial strength across a range of scenarios,
including a depressed demand and pricing environment.
We also maintain a minimum liquidity buffer and access to a
diverse range of funding sources;
– We adjust our capital allocation plans according to market
conditions;
– We maintain strong relationships with high-quality financial
institutions, customers and suppliers from all around the world;
– We mostly sell our products with reference to floating, market-
based prices, which are broadly correlated with floating global
currency markets and the input costs we are exposed to; and
– We carry out an annual review of commodity prices and
exchange rates, which informs our operational plans. This
process is supplemented by tri-annual updates.
+
Learn more about our capital management framework in Our
strategy on page 19.
Risk management continued
38
SOUTH 32 ANNUAL REPORT 2024
STRONG SECOND
HALF RESULTS AND
ACCELERATED PORTFOLIO
TRANSFORMATION
Improved operating performance, disciplined cost management and higher prices for our key
commodities lifted our financial results to finish the year, and we we further transformed our portfolio.
The Group uses both International
Financial Reporting Standards (IFRS)
financial measures and non-IFRS financial
measures such as underlying measures of
earnings, effective tax rate (ETR), return
on invested capital (ROIC), cash flow and
net cash/(debt), to assess the Group’s
performance.
The definitions of individual non-IFRS
financial measures used in this report
are set out in the Glossary of terms and
abbreviations starting on page 191.
A reconciliation of the Group’s underlying
financial results to the statutory
information included in the Group’s
consolidated financial statements is
included in note 4(b)(i) to the financial
statements on page 124.
The Directors believe that the non-IFRS
financials measures are relevant to
understanding the underlying financial
and operating performance of the
Group and its operations. These non-
IFRS financial measures provide useful
information, but should not be considered
as an indication of, or an alternative to,
profit/(loss) after tax as an indicator of
actual operating performance or as an
alternative to cash flow as a measure of
liquidity.
In discussing the operating results of
the Group, the focus is on Underlying
earnings attributable to members and
ROIC. Underlying earnings attributable
to members is the key measure that
is used by the Group to assess our
performance, make decisions on the
allocation of resources and assess senior
management’s performance. In addition,
the performance of each of the Group’s
operations and operational management
is assessed based on Underlying EBIT and
Underlying EBITDA.
Management uses these measures
because financing structures and
tax regimes differ across the Group’s
operations and substantial components
of tax and interest charges are levied at
a Group level rather than an operational
level.
The underlying information reflects
the Group’s interest in material equity
accounted joint ventures and is presented
on a proportional consolidation basis.
In order to calculate Underlying EBITDA,
Underlying EBIT and Underlying earnings
attributable to members, 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/or
consolidation of interests in operations;
– (Gains)/losses on non-trading derivative
instruments, contingent consideration
and other investments measured at fair
value through profit or loss;
– Major corporate restructures;
– Joint venture adjustments for material
equity accounted investments;
– 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 the Group, and
are individually, or in combination with
other related earnings adjustments,
significant to the financial statements,
are excluded to determine Underlying
earnings.
Financial and operational performance summary
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
39
SOUTH 32 ANNUAL REPORT 2024
Financial and operational performance summary continued
Financial Highlights
US$M FY24 FY23 % Change
Revenue from continuing operations 5,479 5,646 (3%)
Profit/(loss) before tax and net finance income/(costs) from continuing operations (735) (466) (58%)
Profit/(loss) after tax (205) (173) (18%)
Profit/(loss) after tax attributable to members
(1)
(203) (173) (17%)
Basic earnings/(loss) per share (US cents)
(2)
(4.5) (3.8) (18%)
Ordinary dividends per share (US cents)
(3)
3.5 8.1 (57%)
Other financial measures
Underlying revenue
(4)(5)
8,296 9,050 (8%)
Underlying EBITDA
(4)
1,802 2,534 (29%)
Underlying EBITDA margin
(4)(6)
22.8% 29.4% (6.6%)
Underlying EBIT
(4)
886 1,616 (45%)
Underlying EBIT margin
(4)(7)
11.1% 18.7% (7.6%)
Underlying earnings
(4)(8)
380 916 (59%)
Basic Underlying earnings per share (US cents)
(2)(4)
8.4 20.0 (58%)
ROIC
(4)
4.5% 10.0% (5.5%)
Ordinary shares on issue (million) 4,529 4,545 (0.4%)
(1) Members are equity holders of South32 Limited. Amounts reported as attributable to members are stated net of amounts attributable to non-controlling interests.
(2) FY24 basic earnings per share is calculated as Profit/(loss) after tax attributable to members divided by the weighted average number of shares for FY24 (4,519 million). FY24
basic Underlying earnings per share is calculated as Underlying earnings attributable to members divided by the weighted average number of shares for FY24. FY23 basic
earnings per share is calculated as Profit/(loss) after tax attributable to members divided by the weighted average number of shares for FY23 (4,572 million). FY23 basic
Underlying earnings per share is calculated as Underlying earnings divided by the weighted average number of shares for FY23.
(3) FY24 ordinary dividends per share is calculated as H1 FY24 ordinary dividend announced (US$18 million) divided by the number of shares on issue at 31December 2023
(4,529 million) plus H2 FY24 ordinary dividend announced (US$140 million) divided by the number of shares on issue at 30 June 2024 (4,529 million).
(4) FY23 and FY24 includes discontinued operation Illawarra Metallurgical Coal.
(5) Underlying revenue includes revenue from third party products and services.
(6) 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.
(7) Comprises Underlying EBIT excluding third party products and services EBIT, divided by Underlying revenue excluding third party products and services revenue.
(8) Refers to Underlying earnings attributable to members.
40
SOUTH 32 ANNUAL REPORT 2024
Safety performance
Nothing is more important than the health, safety and well-being of our people. We continue to implement our Safety Improvement
Program, a multi-year global program of work launched in FY22, designed to enhance our safety culture and achieve a step change in
our safety performance. Our LEAD Safely Every Day program includes safety leadership capability workshops and coaching which has
been delivered to over 1,500 leaders since its launch in FY23. In FY24, we extended the program to frontline employees and a subset of
contractors that perform high-risk work at our operations, and functional roles that support them.
We use a range of leading and lagging indicators to assess our safety performance. Our total recordable injury frequency (TRIF) for FY24
improved by 14 per cent to 5.1 (FY23: 5.9), while lost time injury frequency (LTIF) increased to 1.9 in FY24 (FY23: 1.6
(9)
). Our leading indicator,
significant hazard frequency, increased to 122.3 for FY24 (FY23: 91.6), indicating improved hazard awareness and a positive reporting culture.
Health and safety performance
Performance metric FY24 FY23
(10)
Fatalities from health and safety incidents 0 2
Lost time injury frequency (LTIF) 1.9 1.6
(9)
Total recordable injury frequency (TRIF) 5.1 5.9
Total significant hazard frequency 122.3 91.6
People and culture
An inclusive culture and diverse workforce supports greater collaboration, innovation and performance. Building and maintaining a
workforce that represents the communities in which we operate, especially recruiting more women into operational roles, is an industry-
wide challenge that we are working to address.
We track our inclusion and diversity performance against a series of measurable objectives. The below table shows the representation
of women in our workforce, leadership teams and Board, and the representation of Black People in our South African workforce.
Performance improved or was maintained year-on-year for five of the seven FY24 measurable objectives, and we achieved three of the
seven FY24 measurable objectives.
Inclusion and diversity performance
Diversity representation (%) FY24 measurable objective FY24 FY23
Women in our workforce Achieve at least 23.5% 20.6 20.2
Women on our Board Maintain at least 40% 50.0 44.4
Women in Lead Team Maintain at least 40% 50.0 50.0
Women in Senior Leadership Team Achieve at least 32.7% 30.3 30.3
Women in Operational Leadership Team Achieve at least 31.5% 25.7 28.7
Black People in South Africa in total workforce Maintain at least 85% 88.4 86.9
Black People in South Africa in management roles Achieve at least 60% 51.8 55.3
(9) Seven injuries which occurred in FY23 have been reclassified from restricted work cases to lost time cases, resulting in an increase in LTIF from 1.4 to 1.6
(10) Figures in Italics indicate that an adjustment has been made since the figures were previously reported
(11) 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. Our target is to halve our operational greenhouse gas (GHG) emissions by 2035 compared to our FY21 baseline. FY21 baseline adjusted to exclude GHG emissions
from South Africa Energy Coal and TEMCO, which were divested in FY21.
(12) FY23 downstream transportation and distribution has been restated from 0.9Mt CO
2
e to 0.4Mt CO
2
e following a review of the methodology used in this category.
Addressing climate change
We have set a target to halve our operational greenhouse gas (GHG) emissions (Scope 1 and 2) by 2035
(11)
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 reshaping
our portfolio to commodities critical in the transition to a low-carbon world, decarbonising our operations, and working with others to
decarbonise the value chain. In FY24, Worsley Alumina converted the first two coal-fired boilers to natural gas, and Hillside Aluminium
converted a further 18 per cent of pots to AP3XLE energy efficiency technology (bringing the total to 36 per cent). Our operational
emissions decreased by 6 per cent and Scope 3 emissions decreased by 17 per cent in FY24.
Greenhouse gas emissions
Million tonnes of CO
2
equivalent FY24 FY23
(10)
Operational GHG emissions 20.3 21.7
Scope 3 GHG emissions 54.2 65.0
(12)
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
41
SOUTH 32 ANNUAL REPORT 2024
Financial and operational performance summary continued
Business performance
Aluminium value chain
Alumina
Alumina production was largely unchanged year-on-year at
5.1Mt, with improved plant availability at Brazil Alumina partially
offsetting a temporary bauxite conveyor outage at Worsley
Alumina in Q4 FY24. Production is expected to increase by
approximately 1 per cent in FY25.
Underlying EBITDA increased by US$106 million to US$364 million
in FY24, for an operating margin of 20 per cent, as our average
realised price of alumina increased by 1 per cent and caustic soda
prices declined.
Aluminium
Aluminium production was largely unchanged year-on-year
at 1.1Mt, as Hillside Aluminium achieved record production,
Brazil Aluminium continued to ramp up, and Mozal Aluminium
progressed its recovery plan. Production is expected to increase
by approximately 6 per cent to 1.2Mt in FY25 as Brazil Aluminium
continues to ramp up and Mozal Aluminium delivers its recovery
plan.
Underlying EBITDA decreased by US$115 million to US$121 million
in FY24, for an operating margin of 4 per cent, as a 6 per cent
reduction in the average realised price of aluminium and higher
energy prices more than offset lower smelter raw material input
prices.
Base metals
Copper
Sierra Gorda copper equivalent production decreased by
15 per cent to 73.8kt in FY24, as higher plant throughput was
offset by lower than planned copper grades. Production is
expected to increase by approximately 15 per cent in FY25, with
the continued benefit of the plant de-bottlenecking project and
higher planned copper grades in the next phase of the mine plan.
Underlying EBITDA decreased by US$83 million to US$275 million
in FY24, for an operating margin of 43 per cent, as higher realised
metal prices and lower electricity costs were more than offset by
lower volumes and a one-off workforce payment.
Sierra Gorda progressed the feasibility study for the fourth
grinding line expansion, which has the potential to increase plant
throughput by ~20 per cent to ~58Mtpa (100 per cent basis),
ahead of a planned final investment decision in H1 FY25.
We consolidated our position in the emerging copper district of
San Juan, Argentina, acquiring a 50.1 per cent interest in the
Chita Valley copper project, and increasing our interest in
Aldebaran Resources to 14.8 per cent.
We invested US$27 million in greenfield exploration programs
in FY24, focused on copper exploration prospects in highly
prospective regions.
Following the end of the period, we entered into an earn-in
agreement and strategic alliance with Noronex Limited to identify
and test copper exploration prospects across the Kalahari copper
belt in Namibia.
(13) Refer to market release “Final Investment Approval to Develop Hermosa’s Taylor Deposit” dated 15 February 2024.
(14) Exploration Results and Exploration Targets: The information in this announcement that relates to the Exploration Results and Targets for Taylor, Clark, Peake and Flux is
extracted from the market release “Final investment approval to develop Hermosa’s Taylor deposit” dated 15 February 2024. The information was prepared by D Bertuch,
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.
Zinc
Cannington payable zinc equivalent production increased by
10 per cent to 285.2kt in FY24, despite adverse weather impacts,
as we realised higher average metal grades. Production is
expected to decline by approximately 12 per cent in FY25 as we
rebuild run of mine stocks and continue to manage a significant
increase in underground activity and complexity.
Underlying EBITDA increased by US$76 million to US$289 million,
for an operating margin of 46 per cent, reflecting higher
production volumes and average realised metal prices.
On 15 February 2024, we announced final investment approval
for the Taylor zinc-lead-silver deposit at our Hermosa project
(13)
,
following completion of a feasibility study which confirmed the
potential for attractive returns over multiple decades.
As the first phase of a regional scale opportunity in Arizona,
United States, Taylor’s infrastructure will unlock value for future
growth options, including the Clark battery-grade manganese
deposit and potential discoveries in our highly prospective
regional land package.
We invested US$372 million at Hermosa in FY24, as we installed
critical path infrastructure and progressed studies and permitting
for Taylor and Clark. We expect to invest US$600 million at
Hermosa in FY25 as we progress construction of Taylor, and an
exploration decline at Clark to enable access to ore for further
product test work.
We invested US$24 million in exploration work at Hermosa
in FY24, successfully returning high-grade copper and zinc
results from Peake and Flux
(14)
, respectively. We expect to invest
US$35 million in FY25 as we complete further exploration at Peake
to test the potential for a continuous structural and lithology
controlled system connecting Taylor and Peake.
Nickel
Cerro Matoso payable nickel production was largely unchanged
at 40.6kt in FY24, supported by improved plant throughput and
nickel grades to finish the year. Production is expected to be
35.0kt in FY25, due to lower planned nickel grades.
Underlying EBITDA decreased by US$150 million to US$96 million
in FY24, for an operating margin of 17 per cent, as a significant
decline in the average realised nickel price and a stronger
Colombian peso more than offset lower price-linked royalties.
We continue to progress our strategic review of Cerro Matoso in
response to structural changes in the nickel market. We expect to
provide information on the outcomes of this review in H2 FY25.
42
SOUTH 32 ANNUAL REPORT 2024
Manganese
Australia Manganese
Australia Manganese production decreased by 34 per cent to
2.3Mwmt in FY24, as we temporarily suspended operations in
March 2024 due to the impacts of Tropical Cyclone Megan.
Underlying EBITDA decreased by US$187 million to US$182 million
in FY24, reflecting the impact of Tropical Cyclone Megan.
We continue to implement the operational recovery plan,
dewatering targeted mining pits and commencing a phased
mining restart. Mining activity is expected to increase to support
a planned build in stockpiles ahead of the wet season, with FY25
production guidance set at 1.0Mwmt. Production is expected
to increase to 3.2Mwmt in FY26 as we complete the operational
recovery plan.
Capital expenditure for mine repairs and infrastructure, including
the wharf and a critical bridge, is expected to be approximately
US$125 million in FY25.
Wharf operations are scheduled to recommence in Q3 FY25,
subject to maintaining construction productivity during the wet
season, with sales volumes expected to progressively increase
over Q4 FY25.
Our insurers have confirmed that the damage caused by Tropical
Cyclone Megan is covered under our property damage and
business interruption insurance. We are continuing to work with
our insurers to assess the timing and value of recoveries under
these policies.
South Africa Manganese
South Africa Manganese production increased by 3 per cent
to a record 2.2Mwmt in FY24, as we lifted output of secondary
products to capitalise on stronger manganese prices in Q4 FY24.
Underlying EBITDA decreased by 2 per cent to US$65 million
in FY24, for an operating margin of 19 per cent, as higher sales
volumes were offset by lower realised manganese prices in the
first half of the year.
South Africa Manganese production is expected to be 2.0Mwmt
across FY25 and FY26, as we continue to use higher cost trucking
to optimise sales volumes and margins.
(15) Refer to market release “Sale of Illawarra Metallurgical Coal” dated 29 February 2024. The consideration comprises; upfront cash consideration of US$1,050 million, payable at
completion; deferred cash consideration of US$250 million, payable in 2030; and contingent price-linked cash consideration of up to US$350M, applicable for five years from
the date of completion 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 per cent 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.
(16) Subject to the Eagle Downs project reaching metallurgical coal production of 100,000 tonnes.
(17) Price-linked royalty calculated based on potential future metallurgical coal production and a metallurgical coal index price of at least US$170/t.
Metallurgical coal
Illawarra Metallurgical Coal saleable production decreased by
24 per cent to 4.9Mt in FY24, consistent with guidance, as we
completed planned longwall moves.
Underlying EBITDA decreased by US$333 million to US$522 million
in FY24, for an operating margin of 40 per cent, due to lower
planned volumes and metallurgical coal prices.
On 29 February 2024, we entered into an agreement to sell
Illawarra Metallurgical Coal to an entity owned by
Golden Energy and Resources Pte Ltd and M Resources Pty Ltd,
for cash consideration of up to US$1.65B
(15)
(the Transaction). The
Transaction is now unconditional and is expected to complete on
29 August 2024.
Following the end of the period, we completed the sale of our
50 per cent interest in the Eagle Downs metallurgical coal project
to a subsidiary of Stanmore Resources Limited for US$15 million in
cash, a contingent payment of US$20 million
(16)
and a price-linked
royalty of up to US$100 million
(17)
.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
43
SOUTH 32 ANNUAL REPORT 2024
Financial and operational performance summary continued
Financial performance
Profit and Loss
The Group reported a loss after tax attributable to members
(18)
of US$203 million in FY24, with impairment expenses for
Worsley Alumina (US$388 million post-tax)
(19)
and Cerro Matoso
(US$248 million post-tax), partially offset by an impairment
reversal for Illawarra Metallurgical Coal (US$139 million post-
tax). Underlying earnings
(20)
decreased by US$536 million
to US$380 million in FY24. A reconciliation of profit/(loss) to
Underlying earnings is set out on page 45.
Underlying revenue decreased by US$754 million (or 8 per cent) to
US$8,296 million in FY24 due to lower average commodity prices
(-US$337 million) and lower production volumes predominantly
at Illawarra Metallurgical Coal due to planned longwall moves
(-US$373 million) and at Australia Manganese due to Tropical
Cyclone Megan (-US$159 million). A reconciliation of Underlying
revenue to statutory revenue is included in Note 4 Segment
information to the Financial Report, starting on page 118.
Underlying EBITDA decreased by US$732 million (or 29 per cent)
to US$1,802 million in FY24, for a Group operating margin
(21)
of
22.8 per cent, as the aforementioned revenue impacts more than
offset a US$124 million reduction in the Group’s cost base
(22)
as
we continued our focus on disciplined cost management and
benefitted from lower raw material input prices.
Underlying EBIT decreased by US$730 million (or 45 per cent)
to US$886 million in FY24, as Underlying depreciation and
amortisation was largely unchanged at US$916 million.
Cash Flow
Group free cash flow from operations, excluding equity accounted
investments (EAIs), was an outflow of US$80 million in FY24,
reflecting lower commodity prices and metallurgical coal volumes,
and our investment in productivity, improvement and growth
projects.
Separately, we received net distributions
(23)
of US$53 million
from our manganese and Sierra Gorda EAIs in FY24 (FY23:
US$187 million). The decrease in EAI distributions in FY24
reflected the impact of Tropical Cyclone Megan at Australia
Manganese and our continued investment in projects to grow
future copper production at Sierra Gorda.
Group capital expenditure, excluding EAIs, increased by
US$252 million to US$1,042 million in FY24 as we invested in
critical path infrastructure and studies at our Hermosa project
and additional ventilation capacity at Illawarra Metallurgical Coal.
Group capital expenditure, excluding EAIs, is expected to
decrease by US$52 million to US$990 million in FY25. Safe
and reliable capital expenditure is expected to decrease by
US$293 million with the divestment of Illawarra Metallurgical
Coal, while growth capital expenditure is expected to increase
by US$228 million as we progress construction of Taylor at our
Hermosa project.
(18) Members are equity holders of South32 Limited. Amounts reported as attributable to members are stated net of amounts attributable to non-controlling interests.
(19) Refer to market release “Worsley Alumina Approvals Update” dated 22 July 2024.
(20) Refers to Underlying earnings attributable to members.
(21) 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.
(22) The Group’s total adjusted cost base of US$6,018 million for FY24 (FY23: US$6,142 million) which excludes third party product costs.
(23) FY24 net distributions from our material equity accounted joint ventures comprises of dividends (+US$90 million), initial funding (-US$30 million) to Australia Manganese to
support recovery plans, a net drawdown of shareholder loans (-US$34 million) from manganese and a distribution (+US$27 million) from Sierra Gorda. The distribution from
Sierra Gorda comprised a repayment of US$27 million of accrued interest.
Capital expenditure for our EAIs increased by US$36 million
to US$315 million in FY24 and is expected to increase by
US$70 million to US$385 million in FY25 as we repair and install
critical infrastructure at Australia Manganese.
We returned US$198 million to shareholders during FY24,
with US$163 million in fully-franked ordinary dividends and
US$35 million via the on-market share buy-back.
Balance Sheet
The Group finished the period with net debt of US$762 million.
Net debt reduced by US$329 million in H2 FY24, supported by
improved operating performance, higher commodity prices and
an unwind of working capital to finish the year.
The sale of Illawarra Metallurgical Coal will further enhance the
Group’s balance sheet strength and flexibility and unlock capital
to invest in our high-quality development projects and growth
options in base metals.
Dividends and Capital Management
Consistent with our policy to distribute a minimum 40 per cent
of Underlying earnings as ordinary dividends, the Board has
resolved to pay a fully-franked final ordinary dividend of US
3.1 cents per share (US$140 million) in respect of H2 FY24,
representing 41 per cent of Underlying earnings.
Reflecting the Group’s strengthened financial position and our
disciplined approach to capital management, the Board has
also resolved to allocate US$200 million to our ongoing capital
management program, to be returned to shareholders via an
on-market share buy-back, commencing from completion of
the sale of Illawarra Metallurgical Coal. This takes total returns
under our capital management program to US$2.5 billion, with
the US$200 million increase in the program to be returned to
shareholders by 12 September 2025.
44
SOUTH 32 ANNUAL REPORT 2024
Earnings reconciliation
The Group reported a loss after tax attributable to members of US$203 million in FY24, with impairment expenses for Worsley Alumina
(US$388 million post-tax) and Cerro Matoso (US$248 million post-tax), partially offset by an impairment reversal at Illawarra Metallurgical
Coal (US$139 million post-tax). Underlying earnings decreased by US$536 million to US$380 million.
Consistent with our accounting policies, various items are excluded from the Group’s profit/(loss) to derive Underlying earnings. Total
adjustments to derive Underlying EBIT (US$983 million), shown in the table below, include:
– Net impairment loss/(reversal) of non-financial assets (+US$604 million):
Impairment expenses
○
Worsley Alumina: (+US$554 million) reflecting increased uncertainty created by the Western Australian Environmental Protection
Authority’s recommended conditions for the Worsley Mine Development Project approval and associated challenging operating
conditions
(24)
;
○
Cerro Matoso: (+US$264 million) reflecting structural changes in the nickel market which are expected to continue to place
pressure on nickel prices and discounts for our ferronickel product;
Impairment reversals
○
Illawarra Metallurgical Coal: (-US$197 million) following the announced sale to an entity owned by Golden Energy and Resources
Pte Ltd and M Resources Pty Ltd
(25)
; and
○
Eagle Downs metallurgical coal project: (-US$17 million) following the announced sale to a subsidiary of
Stanmore Resources Limited
(26)
.
– Sierra Gorda (+US$155 million) and manganese joint venture adjustments (+US$129 million): to reconcile the equity accounting
position to a proportional consolidation basis. This included adjustment for idle capacity and other remediation related costs
(+US$93 million) at Australia Manganese as a result of Tropical Cyclone Megan;
– Significant items (+US$50 million): the Group operates a captive insurance program, in which a wholly-owned subsidiary of the Group
insures a number of operations, including Australia Manganese. As a result of Tropical Cyclone Megan, we have recognised a self-
insurance expense of US$50 million with a partially offsetting amount of US$30 million (South32 share) recognised within Australia
Manganese and included in the manganese joint venture adjustments noted above; and
– Net impairment loss of financial assets (+US$29 million): periodic revaluation of the shareholder loan receivable from
Sierra Gorda reflecting copper prices and other macroeconomic assumptions. An offsetting amount is recorded in the Sierra Gorda
joint venture adjustments noted above.
Further information on these adjustments is included in Note 4 Segment information to the Financial Report, starting on page 118.
Profit/(loss) to Underlying EBITDA reconciliation
(27)
US$M FY24 FY23
Profit/(loss) before tax and net finance income/(costs) from continuing operations (735) (466)
Profit/(loss) before tax and net finance income/(costs) from a discontinued operation 638 664
Adjustments to derive Underlying EBIT:
Significant items 50 (186)
Joint venture adjustments 284 291
Exchange rate (gains)/losses on the restatement of monetary items 24 (62)
Net impairment loss/(reversal) of financial assets 29 71
Net impairment loss/(reversal) of non-financial assets 604 1,300
(Gains)/losses on non-trading derivative instruments, contingent consideration and other investments
measured at fair value through profit and loss (8) 4
Total adjustments to derive Underlying EBIT 983 1,418
Underlying EBIT 886 1,616
Underlying depreciation and amortisation 916 918
Underlying EBITDA 1,802 2,534
Profit/(loss) to Underlying earnings reconciliation
(27)
US$M FY24 FY23
Profit/(loss) after tax attributable to members (203) (173)
Total adjustments to derive Underlying EBIT 983 1,418
Total adjustments to derive Underlying net finance costs (228) (203)
Total adjustments to derive Underlying income and royalty related tax expense (172) (126)
Underlying earnings 380 916
(24) Refer to market release “Worsley Alumina Approvals Update” dated 22 July 2024
(25) Refer to market release “Sale of Illawarra Metallurgical Coal” dated 29 February 2024. The consideration comprises; upfront cash consideration of US$1,050 million, payable
at completion; deferred cash consideration of US$250 million, payable in 2030; and contingent price-linked cash consideration of up to US$350 million, applicable for five
years from the date of completion 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 per cent 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.
(26) Refer to media release “Agreement to divest interest in Eagle Downs” dated 12 February 2024.
(27) FY23 and FY24 includes discontinued operation Illawarra Metallurgical Coal.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
45
SOUTH 32 ANNUAL REPORT 2024
Financial and operational performance summary continued
External factors and trends affecting the Group’s result
Commodity prices and changes in product demand and supply
The Group produces metals, concentrates and ores, for which prices are driven by global demand and supply for each of these
commodities. Average commodity prices were broadly lower across FY24, despite improved demand and constrained supply
supporting prices for our key commodities to finish the year. The prices that the Group obtains for its products are a key driver of
business performance, and fluctuations in these markets affect our results, including cash flows and shareholder returns.
Details of the impact on Underlying EBIT from changes in commodity prices are set out in the Earnings Analysis on page 47.
Exchange rates
The Group is exposed to exchange rate risk on foreign currency sales, purchases and expenses, as no active currency hedging is
undertaken. As the majority of sales are denominated in US dollars, and the US dollar plays a dominant role in the Group’s business,
funds borrowed and held in US dollars provide a natural hedge to currency fluctuations. Operating costs and costs of locally-sourced
equipment are influenced by fluctuations in local currencies, primarily the Australian dollar, South African rand, Brazilian real, Colombian
peso, and Chilean peso.
The Group is also exposed to exchange rate translation risk in relation to net monetary liabilities, being foreign currency denominated
monetary assets and liabilities, including debt, tax and other long-term liabilities.
Details of the impact of foreign currency fluctuations on Underlying EBIT are set out in the Earnings Analysis on page 47.
Earnings analysis
The following key factors influenced Underlying EBIT in FY24, relative to FY23.
Reconciliation of movements in Underlying EBIT (US$M)
(28)(29)(30)
0
500
1000
1500
2000
Uncontrollable
1,616
(337)
422
66 (224)
(503)
(181)
FY23 Underlying EBIT
Sales price
Market traded
consumables and
price-linked costs
Foreign exchange
Inflation
Sales volume
Controllable costs
Net finance
costs and tax
27
886
(249)
(259)
2
Other
FY24 Underlying EBIT
Underlying net finance costs
Underlying income
tax expense
Non-controlling interests
380
FY24 Underlying earnings
(28) 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.
(29) Underlying net finance costs and Underlying income tax expense are actual FY24 results, not year-on-year variances.
(30) South32’s ownership shares of operations are presented as follows: Worsley Alumina (86 per cent share), Brazil Alumina (36 per cent share), Brazil Aluminium (40 per cent
share), HillsideAluminium (100 per cent), Mozal Aluminium (63.7 per cent share), Sierra Gorda (45 per cent share), Cannington (100 per cent), Hermosa (100 per cent), Cerro
Matoso (99.9 per cent share), Illawarra Metallurgical Coal (100 per cent), Australia Manganese (60 per cent share), South Africa Manganese ore (54.6 per cent share) and
SouthAfricaManganese alloy (60 per cent share).
46
SOUTH 32 ANNUAL REPORT 2024
Earnings Analysis US$M Commentary
FY23 Underlying EBIT 1,616
Change in sales price (337) Lower average realised prices for our commodities, including:
Aluminium (-US$169 million)
Nickel (-US$143 million)
Manganese (-US$103 million)
Metallurgical coal (-US$26 million) and energy coal (-US$21 million)
Partially offset by higher average realised prices for copper (+US$48 million), silver (+US$42
million), and alumina (+US$21 million)
Net impact of price-linked
costs
422 Lower aluminium smelter raw material input prices (+US$147 million), including pitch and coke
Lower caustic soda prices at Worsley Alumina (+US$83 million) and Brazil Alumina (+US$32
million)
Lower price-linked royalties (+US$72 million)
Lower coal and diesel prices (+US$31 million)
Lower freight and distribution costs (+US$28 million)
Lower electricity prices at Illawarra Metallurgical Coal (+US$20 million)
Change in exchange rates 66 Weaker Australian dollar (+US$58 million), and South African rand (+US$54 million)
Partially offset by a stronger Colombian peso (-US$39 million) and Brazilian real (-US$12 million)
Change in inflation (224) Inflation-linked indexation of our Southern African aluminium smelter electricity prices (-US$46
million)
General inflation across Australia (-US$87 million), South America (-US$54 million) and Southern
Africa (-US$36 million)
Change in sales volume (503) Lower volumes at Illawarra Metallurgical Coal (-US$373 million), Australia Manganese (-US$159
million) and Sierra Gorda (-US$85 million)
Partially offset by higher volumes at Brazil Aluminium (+US$84 million), Cannington (+US$33
million), Brazil Alumina (+US$24 million) and South Africa Mananganese (+US$8 million)
Controllable costs (181) Inventory and volume related movements (-US$184 million) primarily due to a drawdown in
inventories to support higher sales volumes in our aluminium value chain
A planned workforce payment at Sierra Gorda (-US$20 million), following the finalisation of a
new, three-year industrial agreement
Higher contractor and maintenance costs (-US$14 million) including at Sierra Gorda, Hillside
Aluminium and Mozal Aluminium
Partially offset by lower energy costs at Sierra Gorda (+US$18 million), following the transition to
cost efficient, 100 per cent renewable energy supply
Lower consumable and maintenance costs at Cerro Matoso (+US$15 million) as we optimised
our maintenance activity
Other 27 Remediation costs and idle capacity losses at Australia Manganese (+US$93 million), reclassified
as a significant item in accordance with our accounting policies
Higher third party product EBIT (+US$12 million)
Partially offset by our share of the loss from Mineração Rio do Norte (MRN) due to lower bauxite
prices (-US$36 million) and asset write-offs (-US$34 million) including at Australia Manganese
due to Tropical Cyclone Megan
FY24 Underlying EBIT 886
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
47
SOUTH 32 ANNUAL REPORT 2024
Financial and operational performance summary continued
Net finance income/(costs)
The Group’s FY24 Underlying net finance costs of US$249 million primarily comprise the unwinding of the discount applied to our closure
and rehabilitation provisions (US$165 million), interest on lease liabilities (US$59 million) largely for our multi-fuel co-generation facility
at Worsley Alumina, and interest on our US$700 million of senior unsecured notes (US$31 million) issued in H2FY22 to partly fund the
Sierra Gorda acquisition.
Underlying net finance costs reconciliation
(31)
US$M FY24 FY23
Unwind of discount applied to closure and rehabilitation provisions (165) (113)
Interest on lease liabilities (59) (56)
Interest on senior unsecured notes (31) (31)
Change in discount rate on closure and rehabilitation provisions 8 —
Other (2) 12
Underlying net finance costs (249) (188)
Add back earnings adjustment for exchange rate variations on net debt 8 8
Joint venture adjustments
(32)
220 195
Total adjustments to derive Underlying net finance costs 228 203
Remove net finance costs from a discontinued operation 10 7
Net finance income/(costs) (11) 22
Tax expense
The Group’s Underlying income tax and royalty related taxation expense, which includes our material EAIs, decreased by US$253 million
to US$259 million in FY24, for an Underlying effective tax rate (ETR) of 38.8 per cent (FY23: 36.1 per cent). Our Group Underlying ETR
reflects the corporate tax rates
(33)
and royalty related taxes
(34)
of the jurisdictions in which we operate and our geographical earnings mix.
The Underlying ETR for our manganese business was 71.3 per cent in FY24, including the royalty related tax
(34)
at Australia Manganese,
reflecting the derecognition of certain deferred tax assets and reduced profitability as operations at Australia Manganese were
temporarily suspended following Tropical Cyclone Megan. The Underlying ETR for our Sierra Gorda EAI was 0 per cent in FY24, as royalty
related tax
(34)
was offset by the recognition of deferred tax assets on carry-forward tax losses.
Underlying income tax and royalty related taxation expense reconciliation
(31)
US$M FY24 FY23
Underlying EBIT 886 1,616
Include: Underlying net finance costs (249) (188)
Remove: Share of (profit)/loss of EAIs 31 (11)
Underlying profit/(loss) before tax 668 1,417
Income tax expense/(benefit) from continuing operations (106) 174
Income tax expense/(benefit) from a discontinued operation 193 212
Tax effect of other adjustments to derive Underlying EBIT 122 (3)
Tax effect of other adjustments to derive Underlying net finance costs (2) (3)
Exchange rate variations on tax balances (20) 4
Significant items 15 (23)
Joint venture adjustments relating to income tax
(32)
21 96
Joint venture adjustments relating to royalty related tax
(32)
36 55
Total adjustments to derive Underlying income tax (expense)/benefit 172 126
Underlying income tax (expense)/benefit 259 512
Underlying effective tax rate 38.8% 36.1%
(31) FY23 and FY24 includes discontinued operation Illawarra Metallurgical Coal.
(32) 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 their performance. The joint venture adjustments reconcile the proportional consolidation to the equity accounting
position included in the Group’s consolidated financial statements.
(33) The corporate tax rates of the geographies where the Group operates include: Australia 30 per cent, South Africa 27 per cent, Colombia 35 per cent, Mozambique 0 per cent,
Brazil 34 per cent and Chile27 per cent.
(34) Australia Manganese is subject to a royalty related tax equal to 20 per cent 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 per cent and 14 per cent for annual sales over 50kt of refined copper. These royalties are included in Underlying tax
expense.
48
SOUTH 32 ANNUAL REPORT 2024
Cash flow
Group free cash flow from operations, excluding EAIs, was an outflow of US$80 million in FY24, reflecting lower commodity prices
and metallurgical coal volumes, and our investment in productivity, improvement and growth projects. Group free cash flow for the
year reflected a significant uplift in H2 FY24 (H2 FY24: +US$397 million, H1 FY24: -US$477 million), supported by improved operating
performance, higher commodity prices, and an unwind of working capital (H2 FY24: US$182 million unwind, H1 FY24: US$276 million
build).
Group capital expenditure, excluding EAIs, increased by US$186 million to US$1,080 million as we invested in critical path infrastructure
and studies at our Hermosa project and additional ventilation capacity at Illawarra Metallurgical Coal.
Group cash tax paid, excluding EAIs, decreased by US$595 million to US$223 million as cash tax normalised following one-off portfolio
related payments in the prior period.
Separately, we received net distributions
(35)
of US$53 million from our manganese and Sierra Gorda EAIs. Net distributions from our
manganese EAI reflected US$30 million of initial funding provided to Australia Manganese to support recovery plans.
Free cash flow from operations excluding EAIs
US$M FY24 FY23
Profit/(loss) from continuing and discontinued operations (97) 198
Non-cash or non-operating items 1,408 1,852
Share of (profit)/loss from EAIs 60 (246)
Change in working capital (94) 10
Cash generated from operations 1,277 1,814
Total capital expenditure, excluding EAIs, including intangibles and capitalised exploration (1,080) (894)
Operating cash flows generated from operations after capital expenditure 197 920
Net interest paid
(36)
(54) (45)
Income tax paid (223) (818)
Free cash flow from operations (80) 57
Working capital movement
US$M FY24 Commentary
Trade and other receivables (120) Timing of shipments and higher commodity prices in Q4 FY24
Inventories 27 Drawdown of aluminium inventory in H2 FY24
Trade and other payables (7)
Provisions and other liabilities 6
Total working capital movement (94)
(35) FY24 net distributions from our material equity accounted joint ventures comprises of dividends (+US$90 million), initial funding (-US$30 million) to Australia Manganese to
support recovery plans, a net drawdown of shareholder loans (-US$34 million) from manganese and a distribution (+US$27 million) from Sierra Gorda. The distribution from
Sierra Gorda comprised a repayment of US$27 million of accrued interest.
(36) Net interest paid excludes distributions from material equity accounted investments.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
49
SOUTH 32 ANNUAL REPORT 2024
Financial and operational performance summary continued
Capital expenditure
The Group’s capital expenditure
(37)
, excluding EAIs, increased by US$186 million to US$1,080 million in FY24 as we continued our
investment in productivity, improvement and growth projects:
– Safe and reliable capital expenditure (US$266 million), including Illawarra Metallurgical Coal (US$337 million), increased by
US$133 million to US$603 million, reflecting elevated capital expenditure at Illawarra Metallurgical Coal for additional ventilation
capacity;
– Improvement and life extension capital expenditure increased by US$6 million to US$64 million as we completed energy transition
projects at Worsley Alumina and progressed the De-bottlenecking Phase Two project at Brazil Alumina;
– Growth capital expenditure increased by US$116 million to US$372 million at Hermosa, as we installed critical path infrastructure and
progressed studies and permitting for Taylor and Clark; and
– Intangibles and capitalised exploration expenditure was US$33 million, as we completed multiple exploration programs across our
portfolio focused on base metals.
Our share of capital expenditure for our material EAIs increased by US$46 million to US$329 million in FY24:
– Capital expenditure for our manganese EAIs increased by US$25 million to US$109 million, as South Africa Manganese continued
work to access new mining areas and improve rail efficiencies, and Australia Manganese progressed construction of the Eastern
Leases South life extension project, prior to the suspension of operations due to Tropical Cyclone Megan; and
– Capital expenditure for our Sierra Gorda EAI increased by US$21 million to US$220 million, as the operation continued its investment
in deferred stripping, additional tailing storage infrastructure, plant de-bottlenecking, and the feasibility study for the fourth grinding
line expansion project.
Capital expenditure (South32 share)
(37) (38)
US$M FY24 FY23
Safe and reliable capital expenditure (266) (228)
Improvement and life extension capital expenditure (64) (58)
Growth capital expenditure (372) (256)
Intangibles and the capitalisation of exploration expenditure (33) (95)
Discontinued operation - Illawarra Metallurgical Coal (345) (257)
Total capital expenditure (excluding EAIs) (1,080) (894)
EAIs capital expenditure (329) (283)
Total capital expenditure (including EAIs) (1,409) (1,177)
Balance sheet
The Group finished the period with net debt of US$762 million. Net debt reduced by US$329 million in H2 FY24, supported by improved
operating performance, higher commodity prices and an unwind of working capital to finish the year.
The sale of Illawarra Metallurgical Coal will further enhance the Group’s balance sheet strength and flexibility and unlock capital to invest
in our high-quality development projects and growth options in base metals.
We continue to prioritise a strong balance sheet and investment grade credit rating through the cycle. Our current BBB+/Baa1 credit
ratings were re-affirmed by S&P Global Ratings and Moody’s, respectively, during FY24. We also retain access to significant liquidity,
having successfully extended our undrawn sustainability-linked revolving credit facility of US$1.4 billion to December 2027 and
US$1.3 billion to December 2028.
Net debt
US$M FY24 FY23
Cash and cash equivalents 842 1,258
Lease liabilities (710) (674)
Other interest bearing liabilities (894) (1,067)
Net debt
(a)
(762) (483)
(a) Net debt includes Illawarra Metallurgical Coal and Eagle Downs metallurgical coal which are classified as held for sale.
(37) Total capital expenditure comprises Capital expenditure, capitalised exploration and evaluation expenditure 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) South32’s ownership shares of operations are presented as follows: Worsley Alumina (86 per cent share), Brazil Alumina (36 per cent share), Brazil Aluminium (40 per cent
share), HillsideAluminium (100 per cent), Mozal Aluminium (63.7 per cent share), Sierra Gorda (45 per cent share), Cannington (100 per cent), Hermosa (100 per cent), Cerro
Matoso (99.9 per cent share), Illawarra Metallurgical Coal (100 per cent), Australia Manganese (60 per cent share), South Africa Manganese ore (54.6 per cent share) and
SouthAfricaManganese alloy (60 per cent share).
50
SOUTH 32 ANNUAL REPORT 2024
OUTLOOK
Production
We achieved 98 per cent of revised FY24 copper equivalent production guidance
(39)
, as we set consecutive annual production records at
Hillside Aluminium and South Africa Manganese, and lifted production at Cannington by 10 per cent despite adverse weather impacts.
In FY25, we expect to increase our low-carbon aluminium
(40)
production by 17 per cent as Brazil Aluminium continues to ramp up and
Mozal Aluminium delivers its recovery plan, and lift copper production by 15 per cent as Sierra Gorda realises higher planned grades.
Australia Manganese has commenced a phased mining restart with mining activity expected to increase to support a planned build in
stockpiles ahead of the wet season. Wharf operations are expected to recommence in Q3 FY25, subject to maintaining construction
productivity during the wet season.
Production guidance (South32 share)
(41)
FY24 FY25e
(a)
FY26e
(a)
Key guidance assumptions
Worsley Alumina
Alumina production (kt) 3,777 3,750 3,750 Constrained bauxite inventories in FY25 and FY26
Brazil Alumina (non-operated)
Alumina production (kt) 1,286 1,350 1,380 Improved plant stability and realisation of benefits from
the De-bottlenecking Phase Two project
Brazil Aluminium (non-operated)
Aluminium production (kt) 104 130 160 Ramping up across all three potlines
Hillside Aluminium
Aluminium production (kt) 720 720 720 Expected to continue to test its maximum technical
capacity
Mozal Aluminium
(40)
Aluminium production (kt) 314 360 370 Execution of operational recovery plan and return to
nameplate capacity in H1 FY26
Sierra Gorda (non-operated)
Ore processed (Mt) 21.9 21.8 22.0 Expected to increase copper equivalent production by
15 per cent in FY25 and a further 2 per cent in FY26, with
the continued benefit of the plant de-bottlenecking
project and higher planned copper grades
Payable copper equivalent production (kt) 73.5 84.8 86.1
Payable copper production (kt) 60.8 70.0 74.0
Payable molybdenum production (kt) 0.9 1.3 1.0
Payable gold production (koz) 24.6 25.0 20.0
Payable silver production (koz) 607 550 600
Cannington
Ore processed (kdmt) 2,221 2,100 2,200 Increased underground mine complexity and rebuild of run
of mine stocks in FY25
Payable zinc equivalent production (kt) 302.5 265.4 282.2
Payable silver production (koz) 12,666 11,300 12,000
Payable lead production (kt) 112.4 100.0 110.0
Payable zinc production (kt) 60.7 50.0 50.0
Cerro Matoso
Ore processed (kdmt) 2,774 2,750 Subject
to review
Lower planned nickel grades in FY25
FY26 production guidance is not provided, subject to
strategic review
Payable nickel production (kt) 40.6 35.0
Australia Manganese
Manganese ore production (kwmt) 2,324 1,000 3,200 Mining activity to increase across FY25 and FY26 as we
implement the operational recovery plan
South Africa Manganese
Manganese ore production (kwmt) 2,175 2,000 2,000 Continued use of higher cost trucking to optimise sales
volumes
FY24 FY25e
(a)
Key guidance assumptions
Illawarra Metallurgical Coal
Total coal production (kt) 4,938
N/A
Guidance not provided, with the Transaction expected to
complete on 29 August 2024
Metallurgical coal production (kt) 4,305
Energy coal production (kt) 633
(a) The denotation (e) refers to an estimate or forecast year.
(39) Group payable copper equivalent production based on FY24 production guidance, calculated by applying FY23 realised prices for all operations.
(40) Refers to aluminium produced in a process that results in less than 4t CO
2
-e Scope 1 and Scope 2 GHG emissions per tonne of aluminium.
(41) South32’s ownership shares of operations are presented as follows: Worsley Alumina (86 per cent share), Brazil Alumina (36 per cent share), Brazil Aluminium (40 per cent
share), HillsideAluminium (100 per cent), Mozal Aluminium (63.7 per cent share), Sierra Gorda (45 per cent share), Cannington (100 per cent), Hermosa (100 per cent), Cerro
Matoso (99.9 per cent share), Illawarra Metallurgical Coal (100 per cent), Australia Manganese (60 per cent share), South Africa Manganese ore (54.6 per cent share) and
SouthAfricaManganese alloy (60 per cent share).
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
51
SOUTH 32 ANNUAL REPORT 2024
Financial and operational performance summary continued
Costs and capital expenditure
Operating unit costs guidance
Operating unit costs were in line with guidance across our operations in FY24, as we continued our focus on disciplined cost
management. This focus, combined with the benefit of lower raw material input prices in our aluminium value chain, resulted in a
2 per cent reduction in our total cost base in FY24
(42)
.
Looking forward, we remain focused on delivering further cost efficiencies to mitigate industry-wide inflationary pressure and lower
planned volumes at certain operations in FY25.
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 price of raw material inputs and energy. FY25 Operating unit costs for Brazil Aluminium and Mozal
Aluminium are expected to benefit from planned production growth of 25 per cent and 15 per cent, respectively.
Operating unit cost
(43)
FY24 H1 FY24 H2 FY24 FY25e
(a)(b)
Key guidance assumptions
Worsley Alumina
(US$/t) 269 258 280 290 Constrained bauxite supply, higher caustic soda
prices and price-linked royalties
Brazil Alumina (non-operated)
(US$/t) 323 325 320 Not
provided
Will continue to be influenced by the price of raw
material inputs and energy
Brazil Aluminium (non-operated)
(US$/t) 3,500 4,025 3,160 Not
provided
To benefit from a planned 25 per cent increase in
production in FY25, and continue to be influenced by
the price of raw material inputs and energy
Hillside Aluminium
(US$/t) 2,115 2,135 2,097 Not
provided
Will continue to be influenced by the price of raw
material inputs, the South African rand and inflation-
linked energy costs
Mozal Aluminium
(US$/t) 2,371 2,461 2,238 Not
provided
To benefit from a planned 15 per cent increase in
production in FY25, and continue to be influenced by
the price of raw material inputs and energy
Sierra Gorda (non-operated)
(US$/t)
(c)
17.0 18.8 15.2 16.0 Moderation in labour costs following the prior period’s
workforce payment
Cannington
(US$/t)
(c)
154 150 159 170 Lower planned mill throughput
Cerro Matoso
(US$/lb) 5.10 5.57 4.73 5.65 Lower planned nickel grades, partially offset by lower
price-linked royalties and a weaker Colombian peso
Australia Manganese
(US$/dmtu, FOB) 2.32 2.15 N/A Not
provided
Subject to operational recovery plan and volumes in
H2 FY25
South Africa Manganese
(US$/dmtu, FOB) 2.67 2.59 2.78 3.00 Higher price-linked royalties and in-land logistics
costs
(a) FY25e Operating unit cost guidance includes royalties (where appropriate) and the influence of exchange rates, and includes various assumptions for FY25, including: an
alumina price of US$480/t; a manganese ore price of US$7.80/dmtu for 44 per cent manganese product; a nickel price of US$7.50/lb; a silver price of US$27.8/troy oz; a lead
price of US$2,070/t (gross of treatment and refining charges); a zinc price of US$2,750/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$17.50/lb (gross of treatment and refining charges); a gold price of US$2,300/troy oz; an AUD:USD exchange rate
of 0.65; a USD:ZAR exchange rate of 18.50; a USD:COP exchange rate of 4,100; USD:CLP exchange rate of 900; and a reference price for caustic soda; which reflect forward
markets as at August 2024 or our internal expectations.
(b) The denotation (e) refers to an estimate or forecast year.
(c) US dollar per tonne of ore processed. Periodic movements in finished product inventory may impact Operating unit costs.
(42) The Group’s total adjusted cost base of US$6,018M for FY24 (FY23: US$6,142 million) which excludes third party product costs
(43) 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. Manganese Australia FY24 average manganese content of external ore sales was 42.4 per cent
on a dry basis (FY23: 43.8 per cent). 98 per cent of FY24 external manganese ore sales (FY23: 96 per cent) were completed on a CIF basis. FY24 realised FOB ore prices and
Operating unit costs have been adjusted for freight and marketing costs of US$42 million (FY23: US$62 million), consistent with our FOB cost guidance. Manganese South
Africa FY24 average manganese content of external ore sales was 38.8 per cent on a dry basis (FY23: 39.1 per cent). 89 per cent of FY24 external manganese ore sales (FY23:
88 per cent) were completed on a CIF basis. FY24 realised FOB ore prices and Operating unit costs have been adjusted for freight and marketing costs of US$28 million (FY23:
US$61 million), consistent with our FOB cost guidance.
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SOUTH 32 ANNUAL REPORT 2024
Capital expenditure guidance (excluding exploration and intangibles)
FY25 Group capital expenditure, excluding EAIs, is expected to decrease by US$52 million to US$990 million, reflecting lower sustaining
capital expenditure with the divestment of Illawarra Metallurgical Coal, partially offset by higher growth capital expenditure at Hermosa
as we progress construction of Taylor and the exploration decline for Clark:
– Safe and reliable: expected to decrease by US$293 million to US$310 million following the divestment of Illawarra Metallurgical Coal;
– Improvement and life extension: expected to increase by US$13 million to US$80 million, as we complete work for new mining areas
and decarbonisation projects at Worsley Alumina; and
– Growth: expected to increase by US$228 million to US$600 million at Hermosa, as we construct infrastructure for Taylor
(~US$530 million), progress studies and key infrastructure for Clark (~US$40 million) and complete work across the broader project
(~US$30 million).
FY25 capital expenditure for our material EAIs is expected to increase by US$70 million to US$385 million, as we invest to support the
resumption of operations at Australia Manganese and advance projects to grow future copper volumes at Sierra Gorda:
– Manganese EAIs: expected to increase by US$67 million to US$175 million as we invest US$125 million at Australia Manganese to
repair and install critical infrastructure, including the wharf and a critical bridge. Our insurers have confirmed that the damage
caused by Tropical Cyclone Megan is covered under our property damage and business interruption insurance. We are continuing to
work with our insurers to assess the timing and value of recoveries under these policies; and
– Sierra Gorda: expected to be largely unchanged at US$210 million as we continue to invest in deferred stripping and additional
tailings capacity. We expect to update guidance following a final investment decision for the fourth grinding line expansion, planned
for H1 FY25.
Capital expenditure excluding exploration and intangibles (South32 share)
(44)
US$M FY24 FY25e
(a)
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 337 —
(b)
Safe and reliable capital expenditure (excluding EAIs) 603 310
Worsley Alumina 37 45
Brazil Alumina 22 3
Other operations 8 32
Improvement and life extension capital expenditure (excluding EAIs) 67 80
Hermosa 372 600
Growth capital expenditure 372 600
Total capital expenditure (excluding EAIs) 1,042 990
Total capital expenditure (including EAIs) 1,357 1,375
Capital expenditure for EAIs excluding exploration and intangibles (South32 share)
(44)
US$M FY24 FY25e
(a)
Sierra Gorda 175 185
Australia Manganese 39 125
South Africa Manganese 31 35
Safe and reliable capital expenditure (EAIs) 245 345
Sierra Gorda 32 25
(c)
Australia Manganese 26 –
South Africa Manganese 12 15
Improvement and life extension capital expenditure (EAIs) 70 40
Total capital expenditure (EAIs) 315 385
(a) The denotation (e) refers to an estimate or forecast year.
(b) FY25 capital expenditure guidance is not provided for Illawarra Metallurgical Coal, with the sale expected to complete on 29 August 2024.
(c) We expect to update FY25 capital expenditure guidance following a final investment decision for the fourth grinding line project, planned for H1 FY25.
(44) South32’s ownership shares of operations are presented as follows: Worsley Alumina (86 per cent share), Brazil Alumina (36 per cent share), Brazil Aluminium (40 per cent
share), HillsideAluminium (100 per cent), Mozal Aluminium (63.7 per cent share), Sierra Gorda (45 per cent share), Cannington (100 per cent), Hermosa (100 per cent), Cerro
Matoso (99.9 per cent share), Illawarra Metallurgical Coal (100 per cent), Australia Manganese (60 per cent share), South Africa Manganese ore (54.6 per cent share) and
SouthAfricaManganese alloy (60 per cent share).
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
53
SOUTH 32 ANNUAL REPORT 2024
Financial and operational performance summary continued
Capitalised exploration guidance
FY25 Group capitalised exploration, including EAIs, is expected to be US$50 million as we continue base metals exploration programs
across our portfolio. This includes exploration programs at our Hermosa project as we continue to test the Peake copper deposit
(45)
, and
at Sierra Gorda’s Catabela Northeast copper porphyry exploration prospect.
Capitalised exploration (South32 share)
(46)
US$M FY24 FY25e(a)
Capitalised exploration (excluding EAIs) 34 40
EAIs capitalised exploration 14 10
Capitalised exploration (including EAIs) 48 50
(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.
FY24 FY25e(a) Commentary
Group and unallocated expense in Underlying
EBIT (excluding Hermosa, greenfield exploration
and third party products and services EBIT)
(US$M) 96 100 Reflects a normalised run-rate
Hermosa expenses included in Underlying EBIT
(US$M) 24 30 Work across the broader Hermosa project
Underlying depreciation and amortisation
(US$M) 916 810 Reflects divestment of Illawarra Metallurgical Coal
Underlying net finance costs
(US$M) 249 190 Reflects divestment of Illawarra Metallurgical Coal
Greenfield exploration
(US$M) 27 30 Greenfield exploration activity targeting base metals
in highly prospective regions
(a) The denotation (e) refers to an estimate or forecast year.
(45) Exploration Results and Exploration Targets: The information in this announcement that relates to the Exploration Results and Targets for Taylor, Clark, Peake and Flux is
extracted from the market release “Final investment approval to develop Hermosa’s Taylor deposit” dated 15 February 2024. The information was prepared by D Bertuch,
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.
(46) South32’s ownership shares of operations are presented as follows: Worsley Alumina (86 per cent share), Brazil Alumina (36 per cent share), Brazil Aluminium (40 per cent
share), HillsideAluminium (100 per cent), Mozal Aluminium (63.7 per cent share), Sierra Gorda (45 per cent share), Cannington (100 per cent), Hermosa (100 per cent), Cerro
Matoso (99.9 per cent share), Illawarra Metallurgical Coal (100 per cent), Australia Manganese (60 per cent share), South Africa Manganese ore (54.6 per cent share) and
SouthAfricaManganese alloy (60 per cent share).
54
SOUTH 32 ANNUAL REPORT 2024
OPERATION ANALYSIS
A summary of the underlying performance of the Group’s operations is presented below and a more detailed analysis is presented on
pages 56 to 66. Unless otherwise stated: all metrics reflect South32’s share; 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; and Realised sales price is calculated as Underlying revenue excluding third party
products and services divided by sales volume.
Operations table (South32 share)
(47)(48)
Underlying revenue Underlying EBIT
US$M FY24 FY23 FY24 FY23
Worsley Alumina 1,356 1,363 131 68
Brazil Alumina 484 456 (11) (45)
Brazil Aluminium 242 166 (121) (136)
Hillside Aluminium 1,720 1,823 130 191
Mozal Aluminium 812 886 (30) 56
Sierra Gorda 647 684 143 217
Cannington 631 542 206 142
Hermosa – – (28) (19)
Cerro Matoso 556 698 35 189
Australia Manganese 436 688 61 266
South Africa Manganese 343 344 45 45
Third party products and services
(49)
388 399 7 12
Inter-segment / Group and unallocated (780) (782) (123) (84)
South32 Group (excluding Illawarra Metallurgical Coal) 6,835 7, 267 445 902
Illawarra Metallurgical Coal
(50)
1,461 1,783 441 714
South32 Group 8,296 9,050 886 1,616
(47) South32’s ownership shares of operations are presented as follows: Worsley Alumina (86 per cent share), Brazil Alumina (36 per cent share), Brazil Aluminium (40 per cent
share), HillsideAluminium (100 per cent), Mozal Aluminium (63.7 per cent share), Sierra Gorda (45 per cent share), Cannington (100 per cent), Hermosa (100 per cent), Cerro
Matoso (99.9 per cent share), Illawarra Metallurgical Coal (100 per cent), Australia Manganese (60 per cent share), South Africa Manganese ore (54.6 per cent share) and
SouthAfricaManganese alloy (60 per cent share).
(48) Figures in Italics indicate that an adjustment has been made since the figures were previously reported.
(49) FY24 Third party products and services sold comprise US$170 million for aluminium, US$3 million for alumina, US$79 million for freight services, US$102 million for raw
materials and US$34 million for manganese. Underlying EBIT on third party products and services comprise nil for aluminium, US$10 million for alumina, US$(2) million for
freight services, US$(1) milllion for raw materials and nil for manganese. FY23 Third party products and services sold comprise US$86 million for aluminium, US$25 million for
alumina, US$106 million for freight services, US$149 million for raw materials and US$33 million for manganese. Underlying EBIT on third party products and services comprise
US$(1) million for aluminium, US$13 million for alumina, US$(1) million for freight services, US$1 million for raw materials and nil for manganese.
(50) Illawarra Metallurgical Coal’s FY24 and restated FY23 underlying results include third party product and services. FY24 Third party products and services sold was
US$237 million and Underlying EBIT was US$28 million. FY23 Third party products and services sold was US$140 million and Underlying EBIT was US$11 million.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
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SOUTH 32 ANNUAL REPORT 2024
Financial and operational performance summary continued
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 exported to our
Hillside Aluminium and Mozal Aluminium smelters and other
smelters around the world.
South32 holds an 86 per cent share in Worsley Alumina, while
Japan Alumina Associates (Australia) Pty Ltd owns 10 per cent
and Sojitz Alumina Pty Ltd owns four per cent.
Volumes
Worsley Alumina saleable production decreased by 2 per cent
(or 62kt) to 3,777kt in FY24, as a temporary outage of the bauxite
conveyor impacted bauxite supply to the refinery in Q4 FY24.
Production is expected to be 3,750kt across FY25 and FY26 as we
manage bauxite inventories due to delays in regulatory approvals
for new mining areas, and complete additional conveyor
maintenance. The refinery is expected to operate at nameplate
capacity of 4.6Mtpa (100 per cent basis) from FY27, subject to the
receipt of approvals for new mining areas.
On 8 July 2024, the WA Environmental Protection Authority
(WA EPA) published its recommendation that the Worsley Mine
Development Project be approved, subject to conditions. If
imposed in their current form, several conditions would create
significant operating challenges. We have lodged an appeal
in relation to the WA EPA assessment report, and continue to
work collaboratively with the Western Australian Government to
enable Worsley Alumina to continue to meet the State’s robust
environmental standards. We are aiming to secure the required
environmental approvals by the end of CY24.
Operating costs
Operating unit costs decreased by 8 per cent, to US$269/t
in FY24, as lower caustic soda prices (FY24: US$460/t, FY23:
US$659/t), freight rates and a weaker Australian dollar, more than
offset higher energy costs as we converted the first two coal-fired
boilers to natural gas.
We expect FY25 Operating unit costs to increase by 8 per cent,
to US$290/t, due to the impact of constrained bauxite supply,
higher caustic soda prices (FY25e: ~US$500/t) and price-linked
royalties
(51)
.
Financial performance
Underlying EBIT increased by 93 per cent (or US$63 million),
to US$131 million in FY24, as higher average alumina prices
(+US$11 million), lower caustic soda costs (+US$81 million)
and freight rates on sales (+US$18 million), more than offset
lower sales volumes (-US$18 million) and higher energy costs
(-US$8 million).
(51) FY25 Operating unit cost guidance includes royalties (where appropriate) and the influence of exchange rates, and includes various assumptions for FY25, including: an
alumina price of US$480/t; a manganese ore price of US$7.80/dmtu for 44 per cent manganese product; a nickel price of US$7.50/lb; a silver price of US$27.8/troy oz; a lead
price of US$2,070/t (gross of treatment and refining charges); a zinc price of US$2,750/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$17.50/lb (gross of treatment and refining charges); a gold price of US$2,300/troy oz; an AUD:USD exchange rate
of 0.65; a USD:ZAR exchange rate of 18.50; a USD:COP exchange rate of 4,100; USD:CLP exchange rate of 900; and a reference price for caustic soda; which reflect forward
markets as at August 2024 or our internal expectations.
Capital expenditure
Safe and reliable capital expenditure increased by US$20 million
to US$69 million in FY24 and is expected to be US$90 million in
FY25 as we continue our investment in infrastructure to access
new mining areas and additional bauxite residue disposal
capacity.
Improvement and life extension capital expenditure increased
by US$4 million to US$37 million in FY24 and is expected to
be US$45 million in FY25 as we progress the Worsley Mine
Development Project and decarbonisation projects at the refinery.
Safety FY24 FY23
Lost Time Injury Frequency (LTIF) 1.6 0.6
Total Recordable Injury Frequency (TRIF) 8.0 8.6
South32 share FY24 FY23
Alumina production (kt) 3,777 3,839
Alumina sales (kt) 3,767 3,817
Realised alumina sales price (US$/t) 360 357
Operating unit cost (US$/t) 269 291
South32 share (US$M) FY24 FY23
Underlying revenue 1,356 1,363
Underlying EBITDA 324 251
Underlying EBIT 131 68
Net operating assets 1,813 2,457
Capital expenditure 106 82
Safe and reliable 69 49
Improvement and life extension 37 33
Social Investment 0.9 1.1
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SOUTH 32 ANNUAL REPORT 2024
BRAZIL ALUMINA
Location: Pará and Maranhão, Brazil
South32 investment: Bauxite - 33 per cent
South32 share: Alumina - 36 per cent
Brazil Alumina includes the non-operated Mineração Rio do
Norte (MRN) bauxite mine and the non-operated Alumar
alumina refinery. Our share of bauxite produced from MRN is
supplied to the Alumar refinery. The alumina produced from
Alumar refinery is supplied to the co-located Alumar
aluminium smelter and exported to other smelters around
the world.
South32 holds a 33 per cent interest in MRN. Glencore holds
45 per cent and Rio Tinto Alcan holds 22 per cent. We also hold
a 36 per cent share of the Alumar alumina refinery. Alcoa holds
54 per cent and Rio Tinto Alcan holds 10 per cent.
Volumes
Brazil Alumina saleable production increased by 2 per cent
(or24kt) to 1,286kt in FY24, with improved plant availability in H2
FY24. Production is expected to increase by 5 per cent to 1,350kt
in FY25 and a further 2 per cent to 1,380kt in FY26 as the refinery
begins to realise the benefits of the De-bottlenecking Phase Two
project.
Operating costs
Operating unit costs decreased by 12 per cent, to US$323/t in
FY24, as the refinery delivered improved volumes and benefitted
from lower prices for caustic soda (FY24: US$469/t, FY23:
US$722/t), coal-linked energy, and bauxite from MRN linked to
alumina and aluminium prices on a trailing basis.
While Operating unit cost guidance is not provided for this non-
operated facility, we expect FY25 Operating unit costs to benefit
from higher planned volumes and a further reduction in energy
prices.
Financial performance
Underlying EBIT improved by US$34 million, to a loss of
US$11 million in FY24, as higher sales volumes (+US$16 million)
and average realised alumina prices (+US$12 million), together
with lower prices for caustic soda (+US$32 million), energy
(+US$28 million) and bauxite (+US$9 million), more than offset a
stronger Brazilian real (-US$4 million).
Our share of the loss from our equity interest in MRN was
US$30 million in FY24 (FY23: profit of US$6 million), which
reflected lower bauxite prices.
(52) The information in this report that refers to production target and forecast financial information for MRN is based on Proved (8 per cent) and Probable (1 per cent) Ore Reserves
and Measured (91 per cent) Mineral Resources. The Mineral Resources and Ore Reserves underpinning the Production Target have been prepared by Competent Persons in
accordance with the requirement of the JORC Code and is available on pages 177 to 186. South32 confirms that all material assumptions underpinning the production target
and forecast financial information derived from production target continues to apply and have not materially changed.
Capital expenditure
Safe and reliable capital expenditure increased by US$13 million
to US$58 million in FY24 and is expected to be US$60 million in
FY25 as we continue our investment in additional bauxite residue
disposal capacity.
Improvement and life extension capital expenditure increased by
US$9 million to US$22 million in FY24 as we completed key work
for the refinery’s De-bottlenecking Phase Two project. Our spend
is expected to significantly reduce to US$3 million in FY25.
The partners of MRN continue to progress a feasibility study for
the West Zone project, which has the potential to extend the life
of the bauxite mine by more than 20 years
(52)
. A final investment
decision for an enabling transmission line to connect MRN to the
Brazilian power grid is anticipated during FY25. The transmission
line will enable MRN to replace its current diesel-powered
generation with renewable energy sources, reducing operating
costs and GHG emissions.
South32 share FY24 FY23
Alumina production (kt) 1,286 1,262
Alumina sales (kt) 1,282 1,237
Realised sales price (US$/t) 378 369
Operating unit cost (US$/t)(a) 323 368
South32 share (US$M) FY24 FY23
Underlying revenue 484 456
Underlying EBITDA 40 7
Underlying EBIT (11) (45)
Net operating assets 736 738
Capital expenditure 80 58
Safe and reliable 58 45
Improvement and life extension 22 13
(a) Excludes the profit/(loss) from our equity interest in MRN.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
57
SOUTH 32 ANNUAL REPORT 2024
Financial and operational performance summary continued
BRAZIL ALUMINIUM
Location: Maranhão, Brazil
South32 share: 40 per cent
The Brazil Aluminium smelter was restarted during FY22
after being on care and maintenance since 2015. Brazil
Aluminium produces aluminium for domestic and export
markets, with alumina supplied by the co-located Alumar
refinery. Our share of Brazil Aluminium production is
powered by 100 per cent renewable power.
South32 holds a 40 per cent share in the non-operated Alumar
aluminium smelter. Alcoa Corporation holds a 60 per cent share.
Volumes
Brazil Aluminium saleable production increased by 51 per cent
(or 35kt) to 104kt in FY24, as the smelter continued to ramp up all
three potlines. Production is expected to increase by 25 per cent
to 130kt in FY25 and a further 23 per cent to 160kt in FY26.
Operating costs
Operating unit costs decreased by 20 per cent, to US$3,500/t in
FY24, as the smelter continued to ramp up and benefitted from
lower prices for smelter raw material inputs.
While Operating unit cost guidance is not provided for this non-
operated facility, we expect FY25 Operating unit costs to benefit
from a 25 per cent increase to production volumes as the smelter
continues to ramps up.
Financial performance
Underlying EBIT improved by US$15 million, to a loss of
US$121 million in FY24, as higher sales volumes (+US$84 million)
and lower smelter raw material input prices (+US$26 million),
more than offset lower average realised aluminium prices
(-US$8 million), a stronger Brazilian real (-US$8 million), and
production and inventory related costs (-US$75 million) as the
smelter continued to ramp up.
Capital expenditure
Capital expenditure was US$8 million in FY24 and is expected to
be US$12 million in FY25.
South32 share FY24 FY23
Aluminium production (kt) 104 69
Aluminium sales (kt) 102 68
Realised sales price (US$/t) 2,373 2,452
Operating unit cost (US$/t) 3,500 4,357
South32 share (US$M) FY24 FY23
Underlying revenue 242 166
Underlying EBITDA (115) (129)
Underlying EBIT (121) (136)
Net operating assets 68 28
Capital expenditure 8 9
Safe and reliable 8 9
Improvement and life extension – –
58
SOUTH 32 ANNUAL REPORT 2024
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 increased by 1kt to
a record 720kt in FY24, as the smelter continued to test its
maximum technical capacity, despite the impact of
load-shedding. Production is expected to be sustained at 720kt
(53)
across FY25 and FY26.
Operating costs
Operating unit costs decreased by 3 per cent, to US$2,115/t in
FY24, as the smelter continued its strong operating performance
and benefitted from lower prices for smelter raw material inputs,
more than offsetting additional maintenance.
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, including alumina supplied by
our Worsley Alumina refinery, and other external factors including
the South African rand and inflation-linked 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 Africa Producer Price Index. We
continue to work with Eskom and other stakeholders in the South
African energy sector on pathways to secure lower carbon
(54)
electricity supply.
Financial performance
Underlying EBIT decreased by 32 per cent (or US$61 million),
to US$130 million in FY24, as lower average realised aluminium
prices (-US$107 million) and maintenance costs (-US$9 million),
more than offset lower prices for smelter raw material inputs
(+US$89 million).
130 pots were relined at a cost of US$327 thousand per pot
in FY24 (FY23: 96 pots at US$281k per pot), with ~130 pots
scheduled to be relined in FY25. 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 FY24, 36 per cent of the pots had been
relined using AP3XLE technology.
Capital expenditure
Capital expenditure increased by US$22 million to US$40 million in
FY24 and is expected to increase to US$65 million in FY25 as we
replace the smelter’s pot tending assemblies. We expect capital
expenditure to remain elevated across FY25 and FY26 as we
substantially complete our investment in pot tending assemblies.
(53) Production guidance for Hillside Aluminium and Mozal Aluminium does not assume any load-shedding impact on production.
(54) Refers to lower levels of GHG emissions when compared to the current state. Where used in relation to South32’s products or portfolio, it refers to enhancement of existing
methods, practices and technologies to substantially lower the level of embodied GHG emissions as compared to the current state.
Safety FY24 FY23
Lost Time Injury Frequency (LTIF) 0.8 1.7
Total Recordable Injury Frequency (TRIF) 1.6 3.0
South32 share FY24 FY23
Aluminium production (kt) 720 719
Aluminium sales (kt) 720 719
Realised sales price (US$/t) 2,389 2,535
Operating unit cost (US$/t) 2,115 2,178
South32 share (US$M) FY24 FY23
Underlying revenue 1,720 1,823
Underlying EBITDA 197 257
Underlying EBIT 130 191
Net operating assets 805 845
Capital expenditure 40 18
Safe and reliable 38 16
Improvement and life extension 2 2
Social Investment 7. 3 9.1
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
59
SOUTH 32 ANNUAL REPORT 2024
Financial and operational performance summary continued
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.
South32 holds a 63.7 per cent share of Mozal Aluminium. The
Industrial Development Corporation of South Africa Limited holds
32.4 per cent and the Government of the Republic of Mozambique
holds 3.9 per cent (through preference shares).
Volumes
Mozal Aluminium saleable production decreased by 9 per cent
(or 31kt), to 314kt in FY24, as the smelter progressed its recovery
plan, while managing the impact of load-shedding. Production
is expected to increase by 15 per cent to 360kt
(55)
in FY25, and
a further 3 per cent to 370kt
(54)
in FY26 as the smelter returns
toward nameplate capacity.
FY26 production guidance is subject to the extension of the
current power supply agreement for Mozal Aluminium, which
expires in March 2026. We continue to work with Eskom and
the Government of the Republic of Mozambique to extend the
smelter’s hydro-electric power supply, as there are currently no
viable alternative suppliers of renewable energy at the required
scale.
Operating costs
Operating unit costs increased by 2 per cent, to US$2,371/t in
FY24, with sequentially lower Operating unit costs across H2 FY24
of US$2,238/t (H1 FY24: US$2,461/t) as the smelter progressed
its recovery plan and benefitted from lower smelter raw material
input prices.
While Operating unit cost guidance is not provided, we expect
FY25 Operating unit costs to benefit from a 15 per cent increase
in production volumes as the smelter delivers its recovery plan.
The smelter's cost base will continue to be heavily influenced
by the price of smelter raw material inputs, including alumina
supplied by our Worsley Alumina refinery, and other external
factors including the South African rand and inflation-linked
indexation of energy costs.
Financial performance
Underlying EBIT decreased by US$86 million, to a loss of
US$30 million in FY24, as lower average realised aluminium prices
(-US$54 million) and sales volumes (-US$20 million), together
with higher energy (-US$17 million) and maintenance costs
(-US$9 million), more than offset lower prices for smelter raw
material inputs (+US$60 million).
136
(56)
pots were relined at a cost of US$377 thousand per
pot in FY24 (FY23: 82 pots at US$318 thousand per pot) using
AP3XLE technology. We expect to reline ~150 pots in FY25 as we
progressively return pots to operation as part of the recovery
plan.
(55) Production guidance for Hillside Aluminium and Mozal Aluminium does not assume any load-shedding impact on production.
(56) Presented on a 100 per cent basis.
Capital expenditure
Capital expenditure was US$23 million in FY24 and is expected to
be US$25 million in FY25 as we continue our investment in plant
upgrades.
Safety FY24 FY23
Lost Time Injury Frequency (LTIF) 0.6 0.4
Total Recordable Injury Frequency (TRIF) 1.5 1.5
South32 share FY24 FY23
Aluminium production (kt) 314 345
Aluminium sales (kt) 326 334
Realised sales price (US$/t) 2,491 2,653
Operating unit cost (US$/t) 2,371 2,329
South32 share (US$M) FY24 FY23
Underlying revenue 812 886
Underlying EBITDA 39 108
Underlying EBIT (30) 56
Net operating assets 498 578
Capital expenditure 23 17
Safe and reliable 22 16
Improvement and life extension 1 1
Social Investment 2.2 1.8
60
SOUTH 32 ANNUAL REPORT 2024
SIERRA GORDA
Location: Antofagasta, Chile
South32 share: 45 per cent
Sierra Gorda is a large scale, open-pit mine in the prolific
Antofagasta copper mining region, that produces copper,
molybdenum, gold and silver.
South32 holds a 45 per cent share in Sierra Gorda via the Sierra
Gorda S.C.M. incorporated Joint Venture, alongside 55 per cent
joint venture partner KGHM Polska Miedz.
Volumes
Sierra Gorda payable copper equivalent production decreased
by 15 per cent (or 12.7kt) to 73.8kt in FY24, as higher plant
throughput delivered by the de-bottlenecking project was
more than offset by lower than planned copper grades and
molybdenum recoveries in the current phase of the mine plan.
Production is expected to increase by approximately 15 per cent
to 84.8kt in FY25 and a further 2 per cent to 86.1kt in FY26, as the
operation continues to benefit from the de-bottlenecking project
and realises higher metal grades in the next phase of the mine
plan.
Operating costs
Operating unit costs increased by 10 per cent, to US$17.0/t ore
processed in FY24, in line with guidance, as the operation incurred
a planned one-off workforce payment following the finalisation of
a new three-year industrial agreement.
We expect FY25 Operating unit costs to decrease by 6 per cent
to US$16.0/t ore processed, reflecting the normalisation of labour
costs, and maintenance efficiencies
(57)
.
Financial performance
Underlying EBIT decreased by 34 per cent, (or US$74 million) to
US$143 million in FY24, as higher average realised metal prices
(+US$48 million) and lower electricity costs (+US$18 million), under
a cost efficient, 100 per cent renewable electricity contract, were
more than offset by lower sales volumes (-US$85 million), the one-
off workforce payment (-US$20 million), higher maintenance costs
(-US$10 million) and local inflationary pressures (-US$14 million).
(57) FY25 Operating unit cost guidance includes royalties (where appropriate) and the influence of exchange rates, and includes various assumptions for FY25, including: an
alumina price of US$480/t; a manganese ore price of US$7.80/dmtu for 44 per cent manganese product; a nickel price of US$7.50/lb; a silver price of US$27.8/troy oz; a lead
price of US$2,070/t (gross of treatment and refining charges); a zinc price of US$2,750/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$17.50/lb (gross of treatment and refining charges); a gold price of US$2,300/troy oz; an AUD:USD exchange rate
of 0.65; a USD:ZAR exchange rate of 18.50; a USD:COP exchange rate of 4,100; USD:CLP exchange rate of 900; and a reference price for caustic soda; which reflect forward
markets as at August 2024 or our internal expectations.
(58) Sierra Gorda and 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.
Capital expenditure
Safe and reliable capital expenditure was US$175 million in FY24
and is expected to be US$185 million in FY25 as the operation
continues deferred stripping activity and invests in additional
tailings infrastructure.
Improvement and life extension capital expenditure was
US$32 million in FY24 as the operation completed plant
de-bottlenecking work and progressed the feasibility study for
the fourth grinding line expansion.
We expect to spend US$25 million in H1 FY25, ahead of the
planned completion of the feasibility study for the fourth grinding
line project. The project has the potential to increase plant
throughput by ~20 per cent to ~58Mtpa, lifting copper production
and lowering Operating unit costs.
We expect to update FY25 capital guidance following the final
investment decision for the fourth grinding line project.
South32 share FY24 FY23
Ore mined (Mt) 19.9 26.0
Ore processed (Mt) 21.9 21.2
Ore grade processed (%, Cu) 0.36 0.42
Payable copper equivalent
production (kt) 73.8 86.5
Payable copper production (kt) 60.8 70.7
Payable molybdenum production (kt) 0.9 1.2
Payable gold production (koz) 24.6 28.8
Payable silver production (koz) 607 630
Payable copper sales (kt) 60.9 71.8
Payable molybdenum sales (kt) 1.3 1.3
Payable gold sales (koz) 24.9 29.1
Payable silver sales (koz) 605 639
Realised copper sales price (US$/lb) 3.86 3.51
Realised molybdenum sales price (US$/lb) 20.60 21.28
Realised gold sales price (US$/oz) 2,129 1,821
Realised silver sales price (US$/oz) 24.8 21.9
Operating unit cost
(US$/t ore processed)
(58)
17.0 15.4
South32 share (US$M) FY24 FY23
Underlying revenue 647 684
Underlying EBITDA 275 358
Underlying EBIT 143 217
Net operating assets 1,664 1,588
Capital expenditure 207 196
Safe and reliable 175 151
Improvement and life extension 32 45
Exploration expenditure 13 7
Exploration expensed — 4
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
61
SOUTH 32 ANNUAL REPORT 2024
Financial and operational performance summary continued
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 increased by
10 per cent to 285.2kt in FY24, despite adverse weather impacts,
as the operation realised higher average metal grades.
Looking ahead, a significant increase in underground activity
and complexity is expected to drive greater variability in mine
performance as the underground mine progresses toward the
end of its life. Due to these factors and the need to rebuild run
of mine stocks following adverse weather impacts in H2 FY24,
payable zinc equivalent production is expected to be 265.4kt in
FY25 (ore processed 2,100kdmt, silver 11,300koz, lead 100.0kt,
zinc 50.0kt). Production is then expected to increase by 6 per cent
in FY26 to 282.2kt payable zinc equivalent (ore processed
2,200kdmt, silver 12,000koz, lead 110.0kt, zinc 50.0kt) with
improved plant throughput.
Operating costs
Operating unit costs were largely unchanged at US$154/t inFY24,
as higher plant throughput and a weaker Australian dollar were
offset by additional contractor costs to support the planned
increase in underground activity.
We expect FY25 Operating unit costs to increase by 10 per cent,
to US$170/t, reflecting the volume impact of lower ore
processed
(59)
.
Financial performance
Underlying EBIT increased by 45 per cent (or US$64 million),
to US$206 million in FY24, as higher average metal prices
(+US$56 million) and sales volumes (+US$33 million), more than
offset additional contractor costs to deliver planned underground
activity (-US$8 million) and higher local gas prices (-US$5 million).
Capital expenditure
Capital expenditure decreased by US$23 million to US$38 million
in FY24, following the transition to 100 per cent truck haulage in
the prior period. We expect to invest US$45 million in FY25 as we
continue to invest in underground development.
(59) FY25 Operating unit cost guidance includes royalties (where appropriate) and the influence of exchange rates, and includes various assumptions for FY25, including: an
alumina price of US$480/t; a manganese ore price of US$7.80/dmtu for 44 per cent manganese product; a nickel price of US$7.50/lb; a silver price of US$27.8/troy oz; a lead
price of US$2,070/t (gross of treatment and refining charges); a zinc price of US$2,750/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$17.50/lb (gross of treatment and refining charges); a gold price of US$2,300/troy oz; an AUD:USD exchange rate
of 0.65; a USD:ZAR exchange rate of 18.50; a USD:COP exchange rate of 4,100; USD:CLP exchange rate of 900; and a reference price for caustic soda; which reflect forward
markets as at August 2024 or our internal expectations.
(60) Sierra Gorda and Cannington Operating unit cost is Underlying revenue less Underlying EBITDA divided by ore processed. Periodic movements in finished product inventory
may impact Operating unit costs.
Safety FY24 FY23
Lost Time Injury Frequency (LTIF) 5.6 4.8
Total Recordable Injury Frequency (TRIF) 15.8 11.0
South32 share FY24 FY23
Ore mined (kwmt) 2,252 2,223
Ore processed (kdmt) 2,221 2,156
Ore grade processed (g/t, Ag) 205 187
Ore grade processed (%, Pb) 5.9 5.6
Ore grade processed (%, Zn) 3.7 3.8
Payable zinc equivalent production (kt) 285.2 259.6
Payable silver production (koz) 12,666 11,183
Payable lead production (kt) 112.4 101.7
Payable zinc production (kt) 60.7 59.2
Payable silver sales (koz) 11,793 10,739
Payable lead sales (kt) 102.4 99.0
Payable zinc sales (kt) 60.1 58.1
Realised silver sales price (US$/oz) 24.8 21.1
Realised lead sales price (US$/t) 2,002 1,919
Realised zinc sales price (US$/t) 2,230 2,151
Operating unit cost
(US$/t ore processed)
(60)
154 153
South32 share (US$M) FY24 FY23
Underlying revenue 631 542
Underlying EBITDA 289 213
Underlying EBIT 206 142
Net operating assets 150 172
Capital expenditure 38 61
Safe and reliable 37 60
Improvement and life extension 1 1
Exploration expenditure 9 8
Exploration expensed 6 6
Social Investment 0.4 0.5
62
SOUTH 32 ANNUAL REPORT 2024
CERRO MATOSO
Location: Córdoba, Colombia
South32 share: 99.9 per cent
Cerro Matoso is an integrated nickel laterite mine and
smelter located in northern Colombia that produces
ferronickel used to make stainless steel.
South32 owns 99.9 per cent of Cerro Matoso. Current and former
employees own 0.02 per cent, with the balance of shares held in a
reserve account following a buy-back.
We continue to progress our strategic review of Cerro Matoso in
response to structural changes in the nickel market. We expect to
provide information on the outcome of this review in H2 FY25.
Volumes
Cerro Matoso payable nickel production was largely unchanged
at 40.6kt in FY24, supported by improved plant throughput
and nickel grades to finish the year. Production is expected
to be 35.0kt in FY25, reflecting lower planned nickel grades.
FY26 production guidance is not provided as it is subject to the
outcomes of the strategic review.
Operating costs
Operating unit costs were largely unchanged at US$5.10/lb in
FY24, beating our already lowered guidance by 2 per cent, as we
realised further cost efficiencies and benefitted from lower price-
linked royalties, offsetting a stronger Colombian peso.
We expect FY25 Operating unit costs to increase by 11 per cent to
US$5.65/lb, reflecting the volume impact of lower planned nickel
grades, partially offset by a weaker Colombian peso and lower
price-linked royalties
(61)
.
Financial performance
Underlying EBIT decreased by US$154 million, to US$35 million in
FY24, as a significant decline in the average realised nickel price
(-US$143 million) and a stronger Colombian peso (-US$39 million),
more than offset lower price-linked royalties (+US$36 million).
Underlying EBIT improved by US$63 million to US$49 million in H2
FY24 (H1 FY24: EBIT loss of US$14 million) as we took action to
protect margins, and price realisations for our ferronickel product
improved (H2 FY24: ~21 per cent, H1 FY24: ~29 per cent discount
to the LME Nickel Index).
Capital expenditure
Capital expenditure was US$34 million in FY24 and is expected to
reduce by US$14 million to US$20 million in FY25 as we prioritise
our capital program.
(61) FY25 Operating unit cost guidance includes royalties (where appropriate) and the influence of exchange rates, and includes various assumptions for FY25, including: an
alumina price of US$480/t; a manganese ore price of US$7.80/dmtu for 44 per cent manganese product; a nickel price of US$7.50/lb; a silver price of US$27.8/troy oz; a lead
price of US$2,070/t (gross of treatment and refining charges); a zinc price of US$2,750/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$17.50/lb (gross of treatment and refining charges); a gold price of US$2,300/troy oz; an AUD:USD exchange rate
of 0.65; a USD:ZAR exchange rate of 18.50; a USD:COP exchange rate of 4,100; USD:CLP exchange rate of 900; and a reference price for caustic soda; which reflect forward
markets as at August 2024 or our internal expectations.
(62) Cerro Matoso realised nickel sales price is inclusive of by-products.
Safety FY24 FY23
Lost Time Injury Frequency (LTIF) 2.3 1.3
Total Recordable Injury Frequency (TRIF) 2.7 1.6
South32 share FY24 FY23
Ore mined (kwmt) 5,195 5,560
Ore processed (kdmt) 2,774 2,807
Ore grade processed (%, Ni) 1.60 1.62
Payable nickel production (kt) 40.6 40.8
Payable nickel sales (kt) 40.9 40.8
Realised nickel sales price (US$/lb)
(62)
6.17 7.76
Operating unit cost (US$/lb) 5.10 5.03
South32 share (US$M) FY24 FY23
Underlying revenue 556 698
Underlying EBITDA 96 246
Underlying EBIT 35 189
Net operating assets 91 363
Capital expenditure 34 38
Safe and reliable 34 33
Improvement and life extension – 5
Exploration expenditure 3 2
Exploration expensed 3 2
Social Investment 2.6 4.8
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
63
SOUTH 32 ANNUAL REPORT 2024
Financial and operational performance summary continued
AUSTRALIA MANGANESE
Location: Northern Territory, Australia
South32 share: 60 per cent
Australia Manganese consists of Groote Eylandt Mining
Company (GEMCO) in the Northern Territory, Australia.
GEMCO is an open-cut mining operation that produces
high-grade manganese ore.
South32 holds a 60 per cent share in GEMCO and Anglo American
Plc holds the remaining 40 per cent.
On 16 to 17 March 2024, Tropical Cyclone Megan severely
impacted operations at GEMCO, with record rainfall and the
second strongest wind gusts in the past 20 years. The intense
weather system resulted in widespread flooding and significant
damage to critical infrastructure.
Following Tropical Cyclone Megan, we continue to implement the
operational recovery plan, dewatering targeted mining pits and
commencing a phased mining restart. Mining activity is expected
to increase to support a planned build in stockpiles ahead of the
wet season. Wharf operations are scheduled to recommence in
Q3 FY25, subject to maintaining construction productivity during
the wet season, with sales volumes expected to progressively
increase over Q4 FY25.
Volumes
Australia Manganese saleable production decreased by
34 per cent (or 1,221kwmt), to 2,324kwmt in FY24, as we
temporarily suspended operations in March 2024.
Production is expected to be 1,000kwmt in FY25 and 3,200kwmt
in FY26 as we complete the operational recovery plan.
Operating costs
Operating unit costs increased by 23 per cent, to US$2.32/dmtu in
FY24, due to lower volumes as a result of Tropical Cyclone Megan.
FY25 Operating unit cost guidance is not currently provided and
is subject to the operational recovery plan and volumes in H2
FY25.We expect to incur additional idle capacity and remediation
related costs in FY25 as we implement the operational recovery
plan, which will be excluded from FY25 Underlying earnings as an
earnings adjustment.
Financial performance
Underlying EBIT decreased by 77 per cent (or US$205 million) to
US$61 million in FY24. Separately we incurred idle capacity and
other remediation costs of US$93 million that were excluded from
Underlying EBIT as an earnings adjustment.
(63) Volumes and prices do not include any third party trading that may be undertaken independently of equity production. Realised ore prices are calculated as external sales
Underlying revenue less freight and marketing costs, divided by external sales volume.
(64) Manganese Australia FY24 average manganese content of external ore sales was 42.4 per cent on a dry basis (FY23: 43.8 per cent). 98 per cent of FY24 external manganese
ore sales (FY23: 96 per cent) were completed on a CIF basis. FY24 realised FOB ore prices and Operating unit costs have been adjusted for freight and marketing costs of
US$42 million (FY23: US$62 million), consistent with our FOB cost guidance.
(65) FOB Ore Operating unit cost is Underlying revenue less Underlying EBITDA, freight and marketing costs, divided by ore sales volume.
Capital expenditure
Capital expenditure for mine repairs and infrastructure, including
the wharf and a critical bridge, is expected to be approximately
US$125 million in FY25.
Our insurers have confirmed that the damage caused by Tropical
Cyclone Megan is covered under our property damage and
business interruption insurance. We are continuing to work with
our insurers to assess the timing and value of recoveries under
these policies.
Safety FY24 FY23
Lost Time Injury Frequency (LTIF) 4.0 1.5
Total Recordable Injury Frequency (TRIF) 8.4 6.3
South32 share FY24 FY23
Manganese ore production (kwmt) 2,324 3,545
Manganese ore sales (kwmt) 2,573 3,261
Realised external manganese ore sales
price (US$/dmtu, FOB)
(63)(64)
3.77 4.59
Ore operating unit cost (US$/dmtu,
FOB
(64)(65)
2.32 1.88
South32 share (US$M) FY24 FY23
Underlying revenue 436 688
Underlying EBITDA 182 369
Underlying EBIT 61 266
Net operating assets 166 239
Capital expenditure 65 58
Safe and reliable 39 41
Improvement and life extension 26 17
Exploration expenditure 1 1
Exploration expensed – –
Social Investment 1.0 0.8
64
SOUTH 32 ANNUAL REPORT 2024
SOUTH AFRICA
MANGANESE
Location: Northern Cape and Gauteng, South Africa
South32 share: Ore - 54.6 per cent, Alloy - 60 per cent
South Africa Manganese consists of two manganese mines
in the Kalahari Basin, and the Metalloys manganese alloy
smelter which was placed on care and maintenance in FY20.
Hotazel Manganese Mines (HMM) is located in the Kalahari Basin.
South32 holds a 60 per cent interest in Samancor Holdings
(Pty) Ltd (Samancor Holdings) and Anglo American Plc holds
the remaining 40 per cent. Samancor Holdings indirectly owns
74 per cent of HMM, which gives South32 its ownership interest.
The remaining 26 per cent of HMM is owned by Broad-Based
Black Economic Empowerment (B-BBEE) entities
(66)
.
South32 holds an effective 60 per cent interest in Samancor
Manganese (Pty) Ltd (Metalloys manganese alloy smelter). In June
2024, South Africa Manganese entered into a binding agreement
to divest Metalloys, subject to the satisfaction of conditions
(67)
.
Volumes
South Africa Manganese saleable production increased by
3 per cent (or 67kwmt) to a record 2,175kwmt in FY24, as we
lifted output of secondary products to capitalise on stronger
manganese prices in Q4 FY24.
Production is expected to be 2,000kwmt across FY25 and FY26 as
we continue to use higher cost trucking to optimise sales volumes
and margins.
Operating costs
Operating unit costs were largely unchanged at US$2.67/dmtu in
FY24, as higher volumes and a weaker South African rand partially
offset higher in-land logistics costs and local inflationary cost
pressures.
We expect FY25 Operating unit costs to increase by 12 per cent
to US$3.00/dmtu, due to higher price-linked royalties and in-land
logistics costs
(68)
.
Financial performance
Ore Underlying EBIT decreased by 6 per cent (or US$3 million),
to US$48 million in FY24, as higher sales volumes (+US$8 million)
and a weaker South African rand (+US$11 million) were more than
offset by lower average realised manganese prices (-US$9 million),
higher in-land logistics costs (-US$12 million) and local inflationary
pressures (-US$11 million).
(66) The remaining 26 per cent of HMM is owned by B-BBEE entities, of which 17 per cent of the interests were acquired 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.
(67) Refer to media release “Agreement to divest Metalloys manganese alloy smelter” dated 13 June 2024.
(68) FY25 Operating unit cost guidance includes royalties (where appropriate) and the influence of exchange rates, and includes various assumptions for FY25, including: an
alumina price of US$480/t; a manganese ore price of US$7.80/dmtu for 44 per cent manganese product; a nickel price of US$7.50/lb; a silver price of US$27.8/troy oz; a lead
price of US$2,070/t (gross of treatment and refining charges); a zinc price of US$2,750/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$17.50/lb (gross of treatment and refining charges); a gold price of US$2,300/troy oz; an AUD:USD exchange rate
of 0.65; a USD:ZAR exchange rate of 18.50; a USD:COP exchange rate of 4,100; USD:CLP exchange rate of 900; and a reference price for caustic soda; which reflect forward
markets as at August 2024 or our internal expectations.
(69) Volumes and prices do not include any third party trading that may be undertaken independently of equity production. Realised ore prices are calculated as external sales
Underlying revenue less freight and marketing costs, divided by external sales volume.
(70) Manganese South Africa FY24 average manganese content of external ore sales was 38.8 per cent on a dry basis (FY23: 39.1 per cent). 89 per cent of FY24 external manganese
ore sales (FY23: 88 per cent) were completed on a CIF basis. FY24 realised FOB ore prices and Operating unit costs have been adjusted for freight and marketing costs of
US$28 million (FY23: US$61 million), consistent with our FOB cost guidance.
(71) FOB Ore Operating unit cost is Underlying revenue less Underlying EBITDA, freight and marketing costs, divided by ore sales volume.
Capital expenditure
Safe and reliable capital expenditure increased by US$15 million
to US$31 million in FY24 and is expected to be US$35 million
in FY25 as we continue our investment in rail infrastructure to
improve safety and efficiencies, and new mobile fleet.
Improvement and life extension capital expenditure was
US$12 million in FY24 and is expected to be US$15 million in FY25
as we advance work to access new mining areas and increase
future production capacity at our high-grade underground
Wessels mine.
Safety FY24 FY23
Lost Time Injury Frequency (LTIF) 1.6 0.7
Total Recordable Injury Frequency (TRIF) 2.5 0.7
South32 share FY24 FY23
Manganese ore production (kwmt) 2,175 2,108
Manganese ore sales (kwmt) 2,116 2,065
Realised external manganese ore sales
price (US$/dmtu, FOB)
(69)(70)
3.53 3.58
Ore operating unit cost (US$/dmtu, FOB)
(70)(71)
2.67 2.64
South32 share (US$M) FY24 FY23
Underlying revenue 343 344
Manganese ore 343 344
Manganese alloy – –
Underlying EBITDA 65 66
Manganese ore 68 72
Manganese alloy (3) (6)
Underlying EBIT 45 45
Manganese ore 48 51
Manganese alloy (3) (6)
Net operating assets/(liabilities) 200 143
Manganese ore 271 214
Manganese alloy (71) (71)
Capital expenditure 43 25
Safe and reliable 31 16
Improvement and life extension 12 9
Exploration expenditure – 1
Exploration expensed – 1
Social Investment 2.3 3.2
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
65
SOUTH 32 ANNUAL REPORT 2024
ILLAWARRA
METALLURGICAL COAL
Location: New South Wales, Australia
South32 share: 100 per cent
Illawarra Metallurgical Coal operates two underground
metallurgical coal mines in the southern coalfields of New
South Wales, Australia.
We expect to complete the sale of Illawarra Metallurgical Coal for
total cash consideration of up to US$1.65B
(72)
, on 29 August 2024.
Volumes
Illawarra Metallurgical Coal saleable production decreased by
24 per cent (or 1,582kt), to 4,938kt in FY24, in line with guidance,
as the operation completed planned longwall moves.
FY25 production guidance is not provided, as the sale is expected
to completed on 29 August 2024.
Operating costs
Operating unit costs increased by 18 per cent, to US$150/t in
FY24, as we completed planned longwall moves.
Financial performance
Underlying EBIT decreased by 38 per cent (or US$273 million), to
US$441 million in FY24, as lower sales volumes (-US$373 million)
due to planned longwall moves, and lower average realised prices
(-US$47 million), more than offset lower price-linked royalties
(+US$30 million) and local electricity prices (+US$20 million).
Depreciation and amortisation decreased by US$60 million to
US$81 million, as Illawarra Metallurgical Coal ceased depreciating
upon classification as a discontinued operation and held for sale
since February 2024
(72)
.
Capital expenditure
Capital expenditure increased by US$92 million to US$340 million
in FY24 as we continued a significant investment in additional
ventilation capacity at Appin.
(72) Refer to market release “Sale of Illawarra Metallurgical Coal” dated 29 February 2024. The consideration comprises; upfront cash consideration of US$1,050 million, payable
at completion; deferred cash consideration of US$250 million, payable in 2030; and contingent price-linked cash consideration of up to US$350 million, applicable for five
years from the date of completion 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$180/t.
(73) Figures in Italics indicate that an adjustment has been made since the figures were previously reported.
(74) Illawarra Metallurgical Coal revenue includes metallurgical coal and energy coal sales revenue.
Safety FY24 FY23
Lost Time Injury Frequency (LTIF) 3.4 4.3
Total Recordable Injury Frequency (TRIF) 11.2 21.3
South32 share FY24 FY23
Metallurgical coal production (kt) 4,305 5,497
Energy coal production (kt) 633 1,023
Metallurgical coal sales (kt) 4,172 5,402
Energy coal sales (kt) 699 957
Realised metallurgical coal sales price
(US$/t) 275 279
Realised energy coal sales price (US$/t) 107 144
Operating unit cost (US$/t) 150 127
South32 share (US$M)
(a)
FY24 FY23
(73)
Underlying revenue
(74)
1,461 1,783
Underlying EBITDA 522 855
Underlying EBIT 441 714
Net operating assets 1,236 901
Capital expenditure 340 248
Safe and reliable 337 242
Improvement and life extension 3 6
Exploration expenditure 10 17
Exploration expensed 5 9
Social Investment 1.2 0.9
(a) Illawarra Metallurgical Coal has been classified as a discontinued operation and
held for sale since February 2024
(72)
. As a result, the FY24 and restated FY23
underlying results reflect those of the discontinued operation, including third party
products and services. Net operating assets represent the assets and directly
associated liabilities classified as held for sale for FY24 and the restated equivalent
amounts for FY23.
Financial and operational performance summary continued
66
SOUTH 32 ANNUAL REPORT 2024
Length of tenure
(Non-Executive Directors)
Gender diversity
(all Directors)
Location
(Non-Executive Directors)
Ethnicity
(all Directors)
3
6
5 5
2
2
5
1
1
1
7
0-3 years
3-6 years
6-10 years
Female
Male
Australia
Southern Africa
Americas
White British or other White
(including minority-white groups)
Asian/Asian British
Black/African/Caribbean/Black
British
Not specified/prefer not to say
OUR BOARD
IN ACTION
Governance at a glance
The role of our Board is to represent shareholders and to promote and protect
the interests of the Group. In FY24 our Board met 16 times, hosted our Annual
General Meeting, and engaged with shareholders and other stakeholders.
Directors also conducted site visits to Worsley Alumina, Cannington, Australia
Manganese, Mozal Aluminium and the Singapore office.
Board Composition as at 30 June 2024
Our Board visits Cannington
The April 2024 Board program was held in Brisbane, Australia
and included a visit to the Cannington operation in north-west
Queensland.
While at the operation, Directors visited both underground and
surface facilities, spending time in the field with employees to
monitor and assess workplace culture and hear first-hand about
challenges they face.
The Directors were joined by select employees from our
Australian Operations for a lunch and learn session focused on
safety, enabling Directors to better understand safety routines
and interactions experienced at operations and the practical
deployment of our LEAD Safely Every Day training program.
Directors also participated in Active Bystander training, which
builds upon the Living our Code training series and focuses on
the important role of bystanders in helping reduce unsafe and
disrespectful behaviours.
As part of the Board and Committee meetings, the Board
received briefings from external presenters on the management
of sexual harassment, and an update on the political landscape in
South Africa leading into the national election in May 2024.
68
SOUTH 32 ANNUAL REPORT 2024
• Governed the Group, having regard to our purpose, strategy,
values and culture, our shareholders as a whole, and the interests
of other stakeholders;
• Maintained oversight of the integration of ESG considerations,
including our response to the risks and opportunities that climate
change presents, into our strategy and capital allocation, budget,
risk oversight and governance;
• Engaged in ongoing education including briefings from internal
and external experts on governance developments including
cyber security, workplace sexual harassment, climate and
biodiversity, Australian industrial relations reform and work health
and safety;
• Approved the appointment of Ms Sharon Warburton as a Non-
Executive Director;
• Maintained oversight of key talent;
• Approved the revised Board Charter and Terms of Reference for
each of the Board’s standing Committees which were reviewed
and updated to reflect evolving governance, societal and business
issues such as climate change, psychosocial safety, workplace
sexual harassment, cyber security and data privacy; and
• Reported on gender and ethnicity representation on the Board,
confirming that our Board represents a broad cultural, ethnic,
background and geographic mix, and achieves its gender diversity
objectives.
• Worked with our Lead Team to set the direction and tone for a
workplace culture that aligns with our purpose, reflects our values,
and supports the delivery of our strategy;
• Approved our updated Code of Business Conduct and Speak Up
Policy;
• Monitored culture through visits to our operations and offices,
operational deep-dives, and management presentations, applying
a `Culture Health Check' tool to assess alignment of our culture
with our purpose, strategy and values, and evaluating results
of our annual Your Voice employee survey and actions taken to
address improvement areas;
• Maintained oversight of our approach to inclusion and diversity,
monitored progress against our inclusion and diversity
measurable objectives and approved our revised Inclusion and
Diversity Policy; and
• Visited Hotham Park, a recreational facility near the Boddington
bauxite mine, of which Worsley Alumina is a founding partner
and the Malhampsene Primary School near the Mozal Aluminium
smelter.
• Maintained oversight of strategy development and
implementation;
• Participated in a dedicated Strategy Day and engaged with
management on strategic issues;
• Approved decisions to reshape our portfolio towards commodities
for a low-carbon future, including:
• The final investment for development of the Taylor deposit at
the Hermosa project in Arizona, United States;
• The sale of Illawarra Metallurgical Coal in New South Wales,
Australia
(1)
; and
• The divestment of our 50 per cent interest in the Eagle Downs
metallurgical coal project in Queensland, Australia
(2)
.
• Maintained oversight of our pipeline of decarbonisation initiatives;
• Maintained oversight of energy supply challenges at Hillside
Aluminium and Mozal;
• Maintained oversight of our greenfield exploration strategy and
framework, including key exploration partnerships and projects
targeting base metals around the world;
• Maintained oversight of the alignment our remuneration and
benefits framework with our purpose, strategy, values, and
culture;
• Approved our capital management program; and
• Engaged with shareholders and other stakeholders on financial,
operational, remuneration and other matters.
• Maintained oversight of, and a focus on, our approach to safety
and our safety performance;
• Monitored progress of our multi-year Safety Improvement Program,
which aims to achieve a step change in our safety performance;
• Maintained oversight of our approach to serious injury risk
reduction through significant incident investigation reviews with
management and material safety risk deep-dives during visits to
our operations;
• Discussed safety performance at each Sustainability Committee
meeting including progress of our LEAD Safely Every Day training
program;
• Continued to focus on the management of workplace
sexual harassment as a material health and safety risk and
implementation of appropriate controls;
• Maintained oversight of Australia Manganese following Tropical
Cyclone Megan in March 2024, focusing initially on the safety of
our people and the community on Groote Eylandt as a priority,
followed by a phased return to mining activities;
• Participated in Active Bystander training which forms part of the
Living our Code training and discussion series; and
• Heard first-hand from operational employees to better
understand safety routines and interactions and the practical
application of our LEAD Safely Every Day training program, safety
interactions in the field, and the impact of our Safety Improvement
Program training on employees and contractors.
Board focus areas and activities in FY24
Safety and performance
Culture
Strategy
Governance
+
Learn more about our key corporate governance policies and practices in our Corporate Governance Statement 2024
at www.south32.net
(1) For further information see page 25 of this report.
(2) For further information see page 25 of this report.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
69
SOUTH 32 ANNUAL REPORT 2024
Chair appointment Nomination and Governance Committee Remuneration Committee
Risk and Audit Committee Sustainability Committee
Committee membership key:
N R
RA S
N R
Board of Directors
Career summary: Ms Wood has worked in legal practice and
business.
In 2001, Ms Wood joined BHP and held several global executive
leadership roles, including Group Company Secretary, Chief
Governance Officer, Chief People Officer and President People and
Public Affairs (Corporate Affairs). Following her retirement in 2014,
she continued as an adviser to BHP’s Board and Chief Executive
Officer until 2015. She also chaired the BHP Foundation until
2019, overseeing grant provisions for not-for-profit organisations
to deliver global programs in the areas of natural resource
governance, human capability and social inclusion, and conserving
and sustainably managing natural environments. Before joining
BHP, she worked at Bonlac Foods Limited, where she spent five
years as General Counsel and Company Secretary.
Other key positions Ms Wood has held include being a member
of the Takeovers Panel from 2000 to 2012, and roles with the
Australian Securities and Investments Commission (Business
Consultative Panel) and the Australian Government’s Business
Regulatory Advisory Group.
External appointments: Ms Wood is a Director of the Robert Salzer
Foundation, serves as an ambassador for the Australian Indigenous
Education Foundation and is a member of the Advisory Board of
the Sir John Monash Leadership Academy. She was also appointed
as a Director of the Stars Foundation in August 2024. Ms Wood was
a Non-Executive Director of ASX-listed Djerriwarrh Investments
Limited from July 2016 until January 2024.
Skills and experience: Ms Wood brings extensive corporate
governance expertise to her roles as Chair of our Board and
the Nomination and Governance Committee. In these roles, her
experienced leadership promotes a cohesive environment of
constructive challenge and oversight. Ms Wood’s substantial tenure
as a global executive within the resources industry means that she
brings a strong understanding of the regulatory landscape and the
key strategic risks and opportunities for a global mining and metals
company. Her expertise in shaping culture (including through
organisational and remuneration design), public policy, social
performance and stakeholder engagement enables her to bring
valuable insights in these areas.
Career summary: Mr Kerr joined BHP in 1994 and held a wide range
of operational and commercial roles across the business, including
Chief Financial Officer Stainless Steel Materials, Vice President
Finance Diamonds and Finance Director for the BHP Canadian
Diamonds Company.
In 2004, Mr Kerr joined Iluka Resources Limited as General Manager
Commercial. He returned to BHP in 2006, leading to his appointment
as President of Diamonds and Specialty Products where he was
accountable for the Ekati Diamond Mine in Canada, the Richards
Bay Minerals joint venture in South Africa, diamonds exploration
in Angola, the Corridor Sands Project in Mozambique and the
development of BHP’s potash portfolio in Canada.
Mr Kerr was appointed BHP’s Chief Financial Officer in 2011, a role
which he held until 2015 when he left to lead South32 through its
demerger from BHP and listing in three countries.
External appointments: Mr Kerr is a Director of CEOs for Gender
Equity, the Minerals Council of Australia and the Fremantle Football
Club.
Skills and experience: Mr Kerr’s strong track record in resources
development, and global experience as a commercial and
operational leader within the resources industry, means that he
brings deep mining and metals expertise and exceptional financial
acumen. His health and safety expertise, and passion for promoting
inclusion and diversity, are valued contributions to our Board as it
oversees our commitment to elevate our safety performance and
instil a culture where everyone feels safe and respected at work.
Mr Kerr’s strong focus on a purpose-driven and values-led future for
South32 make him a trusted leader as we progress the next phase
of our strategy.
Ms Karen Wood BEd, LLB (Hons), 68
Chair and Independent Non-Executive Director
Appointed: 1 November 2017; Chair: 12 April 2019
Location: Australia
Graham Kerr BBus, FCPA, 53
Chief Executive Officer and Managing Director
Appointed: October 2014; Managing Director: 21 January 2015
Location: Australia
70
SOUTH 32 ANNUAL REPORT 2024
N RRA N RAS
Career summary: Mr Cooper qualified as a chartered accountant in
Australia, leading to a 40-year career in the finance and accounting
profession. He has held a number of senior tax and finance roles,
including Partner at Ernst & Young, Partner / Business Unit Leader,
Tax Practice at PricewaterhouseCoopers and Managing Partner for
Arthur Andersen in Perth (for just over 10 years), during which time
he specialised in the mining, energy and utility sectors.
Other key positions Mr Cooper has held include Commissioner and
Chairman of the Insurance Commission of Western Australia and
Pro Chancellor of the University of Western Australia.
Throughout his career, Mr Cooper has had extensive involvement in
community activities, including serving as Commissioner and Chair
of the West Australian Football Commission and as a Member of the
State Health Research Advisory Council (Western Australia).
In 2014 Mr Cooper was awarded an Officer of the Order of Australia.
He was also named West Australian of the Year in the Professions
category in 2015.
External appointments: Mr Cooper is a Director of St John of God
Australia Limited and Wright Prospecting Pty Ltd. Mr Cooper was
a Non-Executive Director of ASX-listed Woodside Energy Group
Limited from February 2013 until April 2024.
Skills and experience: Mr Cooper brings exceptional financial
acumen and accounting expertise, a strong understanding of
legal and regulatory compliance and substantial experience in
risk management oversight to our Board, all of which also make
him a highly capable Risk and Audit Committee Chair. His listed
company experience and expertise in capital management and
corporate development are highly valued by our Board as it
oversees the implementation of our strategy, as is his strong focus
on organisational philosophy, values and standards.
Career summary: Dr Liu completed her undergraduate study in
Chongqing University in China and her PhD in Extractive Metallurgy
at Imperial College in the United Kingdom, before joining the Rio
Tinto Group as a senior research scientist in 1988.
Over her 26-year career with Rio Tinto, Dr Liu held various roles
in smelting operations, including General Manager Operations
at Bell Bay (Tasmania), leading to other senior operational and
management roles, including Managing Director Technical Services,
where she led Rio Tinto’s global technical services unit. Prior to
her retirement, Dr Liu was President and Chief Executive Officer
of Rio Tinto Minerals, with responsibility for integrated operations
of mining, processing, supply chain, marketing and sales for its
Borates business in the United States, Europe and Asia.
Dr Liu has served as Vice President of the Board of the Australian
Aluminium Council, a Board Member of the California Chamber of
Commerce, a Director of Melbourne Business School and Chancellor
of Queensland University of Technology. She has also served as a
Non-Executive Director at Newcrest Mining Limited (September
2015 until November 2020) and Iluka Resources Limited (February
2016 until April 2019).
External appointments: Dr Liu was a Non-Executive Director
of ASX-listed Incitec Pivot Limited from November 2019 until
May 2024.
Skills and experience: With her accomplished career as a global
executive in the resources industry, Dr Liu brings to our Board
expertise in mining and processing operations, the execution of
major capital projects and commodity value chain management.
Her high financial acumen, expertise in health and safety and
strong understanding of the key environmental impacts, risks
and opportunities relevant to our operations, make her a valued
contributor to the Committees on which she serves. Dr Liu’s
knowledge and experience in technology and innovation, together
with her technical background, is an asset to our Board as it
oversees our advancement towards a low-carbon future.
Mr Frank Cooper AO, BCom, FCA, FAICD, 68
Independent Non-Executive Director
Appointed: 7 May 2015
Location: Australia
Dr Xiaoling Liu BEng (Extractive Metallurgy),
PhD (Extractive Metallurgy), FAusIMM, FTSE, GAICD, 67
Independent Non-Executive Director
Appointed: 1 November 2017
Location: Australia
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
71
SOUTH 32 ANNUAL REPORT 2024
Chair appointment Nomination and Governance Committee Remuneration Committee
Risk and Audit Committee Sustainability Committee
Committee membership key:
N R
RA S
NN RAS
Board of Directors continued
Career summary: Mr Mesquita is a qualified Metallurgical Engineer.
He has worked in the mining and metals industry for more than
40 years and has extensive experience in leading mining and
processing operations and major capital projects.
Mr Mesquita spent 30 years with BHP where he held various
positions in the company’s base metals and aluminium businesses,
including Asset President of Mozal Aluminium and Asset President
of Escondida – the world’s largest copper mine. During this time he
also served as Vice President Major Projects where he led the base
metals projects program, overseeing more than US$10 billion in
mining investments in countries including Chile, Australia and Peru.
Mr Mesquita has also previously advised mining companies and
private equity funds on acquisitions of mining assets in South
America and from 2014 to 2015 he was a Non-Executive Director
of Mineracao Serra Verde, a mid-sized rare earth minerals mine in
central Brazil.
In the first half of 2022, Mr Mesquita was a consultant for South32
providing in-country support following our acquisition of a
45 per cent interest in the Sierra Gorda copper mine.
External appointments: None
Skills and experience: Mr Mesquita has extensive experience
in the global mining and metals industry with a particular focus
on base metals and aluminium in the Americas and Africa. His
previous roles and first-hand experience of working at projects
in an operational capacity means he brings a unique and diverse
perspective to our Board. This, together with his experience in
leading complex operations with responsibility for safety, volume
and costs, support our strategy of optimising our business by
working safely, minimising our impact, consistently delivering
stable and predictable performance, and continually improving our
competitiveness.
Career summary: Dr Mtoba qualified as a chartered accountant in
South Africa and joined Deloitte and Touche in 1988, specialising in
financial services. She was one of the first African Black women to
be appointed Partner by one of the Big Four accounting firms, and
was later appointed Chairperson of Deloitte Southern Africa.
Dr Mtoba is President and founder of TEACH South Africa, which
recruits skilled teachers for underprivileged schools. She has held
several board positions at organisations focused on economic
development and community engagement, including the New
Partnership for Africa’s Development Business Foundation and
the African Union Foundation. Dr Mtoba has also been President
of the Association for the Advancement of Black Accountants and
Business Unity South Africa and chaired the University of Pretoria
Council for over 10 years.
Other positions Dr Mtoba has held include being a member of the
International Monetary Fund Advisory Group of Sub-Saharan Africa,
the World Economic Forum Global Advisory Council, the United
Nations Global Compact Board and a Director of the International
Women’s Forum (South Africa). She has received several awards for
contributions to business and society, including Most Outstanding
Leadership Women of the Year (Africa Economy Builders, 2018).
External appointments: Dr Mtoba is currently a Non-Executive
Director and Deputy Chair of the Public Investment Corporation
Limited and Chair of its Audit Committee, a Director of Discovery
Bank Holdings Limited and Lead Independent Director and Audit
Committee Chair of Discovery Bank Limited, a Director of Vumelana
Advisory Fund, and a Director of Chapter Zero Southern Africa.
Skills and experience: Dr Mtoba’s tenure as partner and a leader
at one of Africa’s predominant financial professional services
firms, and the numerous roles she has held in local, regional and
international organisations and forums, means that she provides
our Board with considerable financial, economic and public policy
expertise and leadership. Dr Mtoba brings a strong focus on culture
and her expertise in social performance and community and
stakeholder engagement are an asset to our Board as it supports
our aspiration to contribute social and economic value where we
operate.
Mr Carlos Mesquita BEng (MetalEng), MBA, 66
Independent Non-Executive Director
Appointed: 1 May 2023
Location: Chile
Dr Ntombifuthi (Futhi) Mtoba CA(SA), DCom (Honoris Causa),
BCompt (Hons), HDip Banking Law, BA (Econ)(Hons), BA (Arts), 69
Independent Non-Executive Director
Appointed: 7 May 2015
Location: South Africa
72
SOUTH 32 ANNUAL REPORT 2024
N S NR S
Career summary: Ms Nelson has a Bachelor of Science in
Agricultural Economics (Cum Laude) from the University of KwaZulu-
Natal in South Africa. She also holds a Bachelor of Arts and Master
of Arts in Philosophy, Politics and Economics from the University of
Oxford in the United Kingdom, where she was a Rhodes Scholar.
Ms Nelson has a 30-year career researching and advocating for
sustainable business practices and was the founding Director of
the Harvard Kennedy School’s Corporate Responsibility Initiative,
where she is now a senior research fellow. She is a non-resident
senior fellow in the Global Economy and Development program at
Brookings and a former senior associate of Cambridge University’s
Programme for Sustainability Leadership.
Ms Nelson served on ExxonMobil’s External Sustainability Advisory
Panel from 2010 to 2023, the Independent Advisory Panel to the
ICMM’s Resource Endowment Initiative and on advisory councils for
other companies, the World Bank Group and the United Nations.
She also worked for The Prince of Wales International Business
Leaders Forum in the United Kingdom, the World Business Council
for Sustainable Development in Africa, FUNDES in Latin America
and as a Vice President at Citibank working in Asia, Europe and the
Middle East.
In December 2023, Ms Nelson was appointed a Companion of
the Order of Saint Michael and Saint George in the UK’s Overseas
and International Honours List for services to business and to
sustainability.
External appointments: Ms Nelson is currently a Non-Executive
Director of NYSE-listed Newmont Mining Corporation (since 2011)
and Chair of its Safety and Sustainability Committee. Ms Nelson is
currently a member of the World Economic Forum’s (WEF) Global
Future Council on Good Governance, WEF’s Climate Governance
Community of Experts and WEF’s Stewardship Council for Food
Systems. Ms Nelson is also a Co-Chair of the Business Commission
to Tackle Inequality and an Emeritus Director of the World
Environment Center.
Skills and experience: Ms Nelson’s career comprises a portfolio
of roles across academia as well as international policy, business
leadership groups and not-for-profit organisations. She has
expertise in sustainable development including in human
rights, cultural heritage and Indigenous issues and a significant
understanding of climate change and biodiversity issues.
Ms Nelson’s strong focus on sustainable development, together
with her passion for building partnerships between business,
government and civil society, is an asset to our Board given this is at
the heart of our purpose and underpins the delivery of our strategy.
Career summary: Mr Osborn worked as an engineer in the
telecommunications and iron ore industries, before joining Alcoa
(Australia) in 1979.
Mr Osborn held several senior management positions with Alcoa
over the course of his career, including having accountability for its
Asia-Pacific manufacturing operations in China, Japan, Korea and
Australia. In 2001 he was appointed Managing Director, leading an
integrated business comprised of bauxite mining, alumina refining,
coal mining, power generation and aluminium smelting until his
retirement in 2008.
Since 2008, Mr Osborn has served as a Non-Executive Director in
the mining, energy and construction industries. Most recently, he
was a Non-Executive Director of Wesfarmers Limited from March
2010 to October 2021.
Other key roles Mr Osborn has held include Chairman of the
Australian Institute of Marine Science, Chairman of the Western
Australia Branch of the Australia Business Arts Foundation and
Vice President of the Chamber of Commerce and Industry, Western
Australia.
Mr Osborn is also a recipient of the WA Business Leader Award
(2007) and the Australian Institute of Company Directors Award for
Excellence (2018).
External appointments: None.
Skills and experience: Mr Osborn brings expertise in mining
and smelting operations, large-scale capital projects and
commodity value chain management to our Board. His broad
skills and experience in health and safety management and
strong understanding of the key environmental issues, risks and
opportunities relevant to our operations, are an asset to our Board
as it oversees our commitments to improve our safety performance,
our approach to sustainability-related risks and opportunities and
how we manage our environmental impact. Mr Osborn’s experience
leading large workforces, expertise in overseeing remuneration
design and implementation and strong focus on sustainability,
make him a highly capable Remuneration Committee Chair.
Ms Jane Nelson CMG, BSc Agricultural Economics (Cum Laude), BA,
MA (Philosophy, Politics and Economics), 64
Independent Non-Executive Director
Appointed: 1 May 2023
Location: United States
Mr Wayne Osborn Dip Elect Eng, MBA, FTSE, 72
Independent Non-Executive Director
Appointed: 7 May 2015
Location: Australia
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
73
SOUTH 32 ANNUAL REPORT 2024
Chair appointment Nomination and Governance Committee Remuneration Committee
Risk and Audit Committee Sustainability Committee
Committee membership key:
N R
RA S
N R S N RA
Board of Directors continued
Career summary: Mr Rumble is a qualified geologist. He joined
Richards Bay Minerals (at that time, a joint venture between
BHP and the Rio Tinto Group) in 1980, working in smelting and
metallurgy, and held various management positions before
becoming Chief Executive Officer in 1996. Prior to that appointment,
Mr Rumble spent just under three years with Rio Tinto’s iron and
titanium business as Director of International Sales and Marketing.
He was appointed President and Chief Executive Officer of Rio Tinto
Iron and Titanium Inc. in Canada in 2000. In 2001, Mr Rumble joined
Impala Platinum, where he held the role of Chief Executive Officer
until 2007 after which he moved to junior miner SUN Mining (part of
the SUN Group), also as Chief Executive Officer.
Since his retirement as an executive in 2008, Mr Rumble has
held Non-Executive Director positions at BHP and South African
infrastructure and resources company, Aveng Limited.
External appointments: Mr Rumble is currently a Director of
Enzyme Technologies (Pty) Limited and Elite Wealth (Pty) Limited.
Skills and experience: With his substantial tenure as an executive
leader in the resources industry, Mr Rumble brings deep knowledge
and experience in mining and smelting operations. His expertise
in geological and geoscience matters and strong understanding
of the key environmental impacts, risks and opportunities relevant
to our business, enhance our Board’s capability to oversee our
sustainability commitments, risks and impacts. These skills,
together with his health and safety management expertise and
proficiency in risk management, make him a valuable member
of the Sustainability Committee. Mr Rumble was Chair of the
Sustainability Committee from 2015 until April 2024.
Career summary: Ms Warburton is a chartered accountant
with more than 25 years’ experience across the major project
infrastructure, property development, and resources industries.
She has previously held executive roles with Brookfield Multiplex,
Citigroup, and Rio Tinto, working across Australia, Asia, Europe
and the Middle East. Ms Warburton’s previous board experience
includes as a Director of Perth Children’s Hospital Foundation, Gold
Road Resources Limited, NEXTDC Limited, Barminco, Western
Power, Northern Australia Infrastructure Facility and Blackmores
Limited. Ms Warburton was also a Director of Fortescue Metals
Group.
In 2014, Ms Warburton was awarded Western Australia Telstra
Business Woman of the Year.
External appointments: Ms Warburton is currently a Non-
Executive Director of ASX-listed Northern Star Resources Limited
(since 2021), Wesfarmers Limited (since 2019) including Chair of
its Audit and Risk Committee, and Worley Limited (since 2019)
including Chair of its Audit and Risk Committee. Ms Warburton
is also an Independent Director of Mirvac Funds Management
Australia Limited, Thiess Group Holdings Pty Limited and Karlka
Nyiyaparli Aboriginal Corporation. From May 2015 until April 2024,
Ms Warburton was a part-time member of the Takeovers Panel. She
is a member of Chief Executive Women and an Adjunct Professor in
Leadership and Strategy at the Curtin University School of Business.
Skills and experience: Ms Warburton is a prominent and highly
credentialled Director. Her extensive experience in areas of
corporate strategy, business operations, accounting and finance,
major project construction, risk management and governance
contribute to the Board’s broad range of skills and support the
delivery of our strategy.
Mr Keith Rumble BSc, MSc (Geology), 70
Independent Non-Executive Director
Appointed: 27 February 2015
Location: South Africa
Ms Sharon Warburton BBus (Accounting and Business Law), FCA,
FAICD, 54
Independent Non-Executive Director
Appointed: 28 November 2023
Location: Australia
74
SOUTH 32 ANNUAL REPORT 2024
Directors' report
This report is presented by the Board of Directors of South32
Limited, together with the Group’s Financial report, for the
financial year ended 30 June 2024.
This report is prepared in accordance with the requirements of
the Corporations Act, with the following information forming part
of this report:
– Operating and Financial Review on the inside front cover to
page 66;
– Director biographical information on pages 70 to 74;
– Remuneration report on pages 82 to 108;
– Note 19(b) Financial risk management objectives and policies
on pages 151 to 154;
– Note 20 Share capital on page 154;
– Note 21 Auditor’s remuneration on page 155;
– Note 22 Employee share ownership plans on pages 155 to 158;
– Note 31 Subsequent events on page 167;
– Directors’ declaration on page 170;
– Auditor’s independence declaration on page 171;
– Resources and Reserves on pages 177 to 186;
– Shareholder information on pages 188 to 190; and
– Corporate directory on page 199.
Directors and meetings
At the date of this report, the Directors in office were:
Ms Karen Wood Appointed 1 November 2017
Mr Graham Kerr Appointed 21 January 2015
Mr Frank Cooper AO Appointed 7 May 2015
Dr Xiaoling Liu Appointed 1 November 2017
Mr Carlos Mesquita Appointed 1 May 2023
Dr Ntombifuthi (Futhi) Mtoba Appointed 7 May 2015
Ms Jane Nelson Appointed 1 May 2023
Mr Wayne Osborn Appointed 7 May 2015
Mr Keith Rumble Appointed 27 February 2015
Ms Sharon Warburton Appointed 28 November 2023
You can find information about our Directors’ qualifications,
experience, special responsibilities and other directorships on
pages 70 to 74.
Board and Committee meetings and Director
attendance
There are 10 regularly scheduled meetings of our Board each
year and Committee meetings are also held during this time.
Additional meetings are convened as required to address
business critical issues.
During FY24, there were a total of 16 Board meetings. Six of these
were held face-to-face at either one of our offices or geographic
areas of operation. The additional non-scheduled meetings
were held to consider options in relation to the sale of Illawarra
Metallurgical Coal, Director succession planning and other critical
business issues.
Throughout the year, Directors conducted site visits to Australia
Manganese, Worsley Alumina, Cannington and Mozal Aluminium,
the Singapore office, and all attended a dedicated strategy day
held in June 2024. In addition to the site visits, during FY24 our
Board continued to stay connected with our operations by way of
operational overviews and briefing sessions conducted as part of
the Board program.
To help it carry out its responsibilities, our Board has four
standing Board Committees. From time to time and on an “as
needs basis”, the Board creates other committees to address
important matters and areas of focus for the business. For
example, a committee was established to oversee the Group’s
sale of Illawarra Metallurgical Coal.
All Directors have a standing invitation to attend all Committee
meetings, and in practice, all Directors generally attend all
meetings.
The number of Board and Committee meetings held in FY24, as
well as the Directors who attended them, can be found in Table
1.1.
Our Chair sets the agenda for each Board meeting, with the
Chief Executive Officer (CEO) and the Company Secretary. The
meetings typically include:
– Minutes of the previous meeting and matters arising;
– Report from our Chair;
– Update on various governance matters;
– CEO’s report;
– Finance report;
– Commercial report;
– Reports on major projects and strategic matters;
– Board Committee Chair reports;
– Continuous disclosure checkpoint; and
– Closed sessions with Directors and closed sessions with Non-
Executive Directors only.
Our Directors receive regular updates from management on a
range of relevant issues, including safety (with a broad focus
covering both physical and psychosocial safety, as well as
sexual harassment), climate change, greenhouse gas emissions
reduction targets, evolving regulations and policy developments,
workplace culture, inclusion and diversity, cultural heritage,
community matters, business integrity, and litigation. Additionally,
they receive reports for discussion on operational performance,
corporate culture and leadership, corporate governance, and
other business matters, including market updates and research.
In between meetings, our Board receives regular reports from
senior management on matters, including (but not limited to):
– Sustainability (including health and safety) performance;
– Financial and production performance;
– Cyber security and privacy;
– Government relations and political affairs;
– Investor relations hosted engagements (including
environmental, social and governance updates);
– Project updates (including pending investment decisions) and
other significant business imperatives;
– Market and commodity updates; and
– Relevant media coverage.
As part of their ongoing education and training, during FY24 our
Board received external briefings on various matters including
cyber security risk, climate and biodiversity risk governance and
disclosure matters, workplace sexual harassment, the political
landscape and developments in South Africa and Australian
workplace relations reforms.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
75
SOUTH 32 ANNUAL REPORT 2024
Table 1.1 Board and Committee Meeting Attendance in FY24
Board
Nomination and
Governance Committee
Remuneration
Committee
Risk and Audit
Committee
Sustainability
Committee
Eligible
(1)
Attended
(2)
Eligible
(1)
Attended
(2)
Eligible
(1)
Attended
(2)
Eligible
(1)
Attended
(2)
Eligible
(1)
Attended
(2)
K Wood 16 16 9 9 7 7 - 11 - 8
G Kerr (CEO) 16 16 - 9 - 7 - 11 - 8
F Cooper 16 16 9 9 7 7 11 11 - 8
X Liu
(3)
16 16 9 9 - 7 11 11 8 8
C Mesquita 16 16 9 9 - 7 - 11 8 8
N Mtoba 16 16 9 9 - 7 11 11 - 8
J Nelson 16 16 9 9 - 7 - 11 8 8
W Osborn
(4)
16 16 9 9 7 7 9 11 8 8
K Rumble
(3)
16 16 9 9 7 7 - 11 8 8
S Warburton
(4)(5)
8 8 2 5 - 3 2 5 - 4
Member Chair
(1) Indicates the number of meetings held during FY24 while the Director was a member of the Board or Committee.
(2) Indicates the number of meetings the Director attended during FY24.
(3) Effective 1 April 2024, X Liu was appointed Chair of the Sustainability Committee (replacing K Rumble in that role).
(4) Effective 1 April 2024, S Warburton was appointed a member of the Nomination and Governance Committee and Risk and Audit Committee, and W Osborn ceased to be a
member of the Risk and Audit Committee.
(5) S Warburton was appointed as a Director effective 28 November 2023.
Diversity representation
We aim to be welcoming and inclusive, and embrace and celebrate differences. We know an inclusive and diverse workforce is safer
and allows for greater collaboration, innovation and performance. Learn more about our commitment to inclusion and diversity in our
Inclusion and Diversity Policy available at www.south32.net.
We are committed to building and maintaining an inclusive and diverse workforce that reflects the communities in which we operate.
Diversity is a key attribute of high performance in a well-functioning Board and Lead Team, and offers benefits including varied thoughts
and perspectives along with unique insights and healthy challenge, which lead to better decision-making as we execute our strategy.
We consider inclusion and diversity in tandem, grounded in mutual respect, where each person’s unique differences are recognised,
valued, and celebrated.
Our vision for diversity considers the broadest definition of difference, including but not limited to gender, ethnicity, nationality, cultural
background, geographic location, language/accent, religious beliefs, socio-economic background, neurodiversity, disability, physical
attributes, appearance, age, education, family responsibilities and sexuality.
Table 1.2 Gender and ethnicity representation on the Board and Executive Management as at 30 June 2024
Board and Executive Management diversity
Number of
Board
members
Percentage of
the Board
Number of
senior
positions on
the Board
(CEO, CFO, SID
and Chair)
(1)
Number in
Executive
Management
(2)
Percentage of
Executive
Management
Gender identity
Men 5 50.0% 1 4 44.4%
Women 5 50.0% 1 5 55.6%
Not specified / prefer not to say - - - - -
Ethnic background
White British or other White (including minority-white groups) 7 70.0% 2 6 66.7%
Mixed/Multiple Ethnic Groups - - - 2 22.2%
Asian/Asian British 1 10.0% - 1 11.1%
Black/African/Caribbean/Black British 1 10.0% - - -
Other ethnic group - - - - -
Not specified / prefer not to say 1 10.0% - - -
(1) The United Kingdom (UK) Financial Conduct Authority (FCA) prescribes that the senior positions on the Board are the Chair, CEO, Chief Financial Officer (CFO) and Senior
Independent Director (SID). For South32, the senior positions on the Board are only the Chair and the CEO. In line with market practice for Australian listed companies, the CFO
does not sit on the Board and South32 does not have a SID as this role is not required under the corporate governance code South32 applies, being the ASX Principles and
Recommendations.
(2) In accordance with the UK Listing Rules, Executive Management includes the Lead Team (our most senior executive body below the Board) and the Company Secretary,
excluding administrative and support staff.
The FCA requires listed companies to publish information on gender and ethnic representation of the Board and Executive Management
including demonstrated performance against the FCA’s diversity and inclusion targets, namely that at least 40 per cent of the Board are
women, at least one of the senior Board positions is held by a woman and at least one member of the Board is from a non-white ethnic
minority background. South32 meets or exceeds all of these targets, as set out in Table 1.2.
The data presented in Table 1.2 was collected via self-reported questionnaires completed by all members of the Board and Executive
Management that included the definitions prescribed by the UK Listing Rules.
Directors' report continued
76
SOUTH 32 ANNUAL REPORT 2024
Principal activities, state of affairs and review of
operations
Principal activities and significant changes during the
financial year
In FY24, the principal activities of the Group were mining and
metals production, from a portfolio of assets that included
bauxite, alumina, aluminium, copper, zinc, lead, silver, nickel,
manganese and metallurgical coal.
In February 2024, the Group announced its decision to enter into
a binding agreement to sell Illawarra Metallurgical Coal subject
to the completion of certain conditions which were achieved on
29 July 2024.
In March 2024, Tropical Cyclone Megan severely impacted
operations at Australia Manganese, causing significant damage to
critical infrastructure and a temporary suspension of operations.
Phased mining operations resumed in June 2024 with wharf
export capability scheduled to commence in Q3 FY25, subject to
maintaining construction productivity during the wet season.
There were no other significant changes in the Group’s principal
activities during the financial year.
State of affairs
There were no significant changes in the Group’s state of
affairs during the financial year, other than the Group’s binding
agreement to sell Illawarra Metallurgical Coal, which is expected
to complete on 29 August 2024, the temporary suspension of
operations at Australia Manganese due to Tropical Cyclone
Megan, and as set out in the Operating and Financial Review on
the inside front cover to page 66.
Review of operations, likely developments and
expected results
A review of the Group’s FY24 operations is set out in the
Operating and Financial Review on the inside front cover to
page 66.
The Operating and Financial Review also includes likely
developments in the Group’s operations in future financial years
and expected results of those operations.
Dividends
We paid the following dividends during FY24:
Total dividend Payment date
Final dividend of US 3.2 cents per share
(fully-franked) for the year ended
30 June 2023
US$145
million
12 October
2023
Interim dividend of US 0.4 cents per
share (fully-franked) for the half-year
ended 31 December 2023
US$18
million
4 April
2024
Matters since the end of the financial year
Refer to note 31 to the financial statements (Subsequent events)
on page 167.
No other matters or circumstances have arisen since the end
of the financial year 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’ relevant interests in shares
Table 1.3 Directors’ Relevant Interests in South32 Limited
Shares
Director
Number of South32 Limited shares in which a relevant
interest is held as at the date of this Directors’ Report
K Wood 367,825
G Kerr (CEO)
(1)
8,502,545
F Cooper 128,010
X Liu 66,000
C Mesquita 177,4 4 0
N Mtoba 71,386
J Nelson -
W Osborn 174,104
K Rumble 161,380
S Warburton 42,870
(1) At the date of this Directors’ Report, G Kerr’s total interest includes 2,040,944
South32 Limited ordinary shares and 6,461,601 rights over South32 Limited shares
held under the South32 Equity Incentive Plan.
Rights and options over South32 Limited shares
No rights or options over South32 Limited ordinary shares are
held by any of our Non-Executive Directors.
Our CEO and Managing Director, Graham Kerr, holds rights over
South32 Limited shares, granted under the South32 Equity
Incentive Plan. You can find more details about this in the
Remuneration report on page 82.
The total number of rights over South32 Limited shares on issue
as at 30 June 2024 is set out in note 22 to the financial statements
(Employee share ownership plans) on pages 155 to 158. No rights
have been granted since the end of FY24. As of the date of this
report, the total number of rights over South32 Limited shares on
issue is 47,648,705.
No shares have been issued on vesting of rights during or since
the end of FY24.
South32 Limited has not had any options on issue during or since
the end of FY24.
Company Secretary
Claire Tolcon LLB, BComm, FGIA, GAICD
Claire Tolcon is our Company Secretary and was appointed to
this position on 30 October 2020. Claire joined South32 in 2017
and was a corporate lawyer in our legal team before moving
into Company Secretariat. Prior to South32, Claire held the role
of General Counsel and Company Secretary for a number of
Australian Securities Exchange (ASX) listed entities, before this
she was a partner of a corporate law firm in Perth. She holds
a Bachelor of Laws and Bachelor of Commerce from Murdoch
University, a Graduate Diploma of Applied Finance and Investment
from Kaplan Business School and is a Fellow of the Governance
Institute of Australia.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
77
SOUTH 32 ANNUAL REPORT 2024
Indemnities and insurance
The South32 Limited Constitution requires that we indemnify
each Director and Company Secretary (as well as employees
appointed as directors and secretaries of a Group company) on
a full indemnity basis and to the extent permitted by law against
liability incurred by them in their capacity as an officer of any
Group company. The Directors and the Company Secretary
named in this report have the benefit of this indemnity (as do
individuals who formerly held one of these positions).
As permitted by our Constitution, South32 Limited has entered
into Deeds of Indemnity, Access and Insurance with each of the
Company’s Directors, Company Secretary and the CFO under
which we agree to indemnify those persons on a full indemnity
basis and to the extent permitted by law.
We purchase directors and officers liability insurance which
insures against certain liabilities (subject to exclusions) in
respect of current and former Directors and other Officers of
the Group. Due to confidentiality obligations and undertakings
of the insurance, we can’t disclose any further details about the
premium or insurance.
During FY24 and as at the date of this Directors’ report, no
indemnity in favour of a current or former Director or Officer of
the Group has been called on.
Corporate Governance
Under ASX Listing Rule 4.10.3, ASX listed entities are required
to benchmark their corporate governance practices against
the fourth edition of the ASX Corporate Governance Council’s
Corporate Governance Principles and Recommendations (ASX
Recommendations).
South32 is compliant with all relevant ASX Recommendations.
Our Corporate Governance Statement 2024 is available at
www.south32.net. It also contains the information required under
the UK FCA’s Disclosure Guidance and Transparency Rules.
Auditor
Our External Auditor has provided an independence declaration
in accordance with the Corporations Act, which is set out on page
171 and forms part of this report.
Non-audit services
No non-audit services were undertaken by, and no amounts in
respect of such services were paid or are payable to, our External
Auditor during FY24. Refer to Note 21 to the financial statements
(Auditor’s remuneration) on page 155.
Political donations and social investment
Our Code of Business Conduct sets out our approach to political
donations and social investment.
In FY24, we made no political donations to any political party,
politician, political party official, elected official or candidate for
public office in any country. On occasion, our representatives
attend political events that charge an attendance fee where
attendance is approved beforehand in accordance with our
internal approval requirements. We record the details of
attendances and the relevant costs at a corporate level.
In FY24, we contributed US$24 million in social investment that
comprised direct investment, in-kind support and administrative
costs. For more information on our social investment, please refer
to our Sustainable Development Report 2024, available at
www.south32.net.
Proceedings on behalf of South32
No proceedings have been brought or intervened in on our behalf,
nor any application made, under section 237 of the Corporations
Act.
Environmental performance
Performance in relation to environmental regulation
We seek to be compliant with all applicable environmental laws
and regulations relevant to our operations.
We classify environmental incidents based on actual and potential
impact type as defined by our internal material risk management
standard. In FY24, there were no environmental events that
resulted in a major impact to the environment.
Fines and prosecutions
During FY24, we have not identified any instances of significant
non-compliance with applicable laws and regulations, or received
any significant fines, non-monetary sanctions or prosecutions.
We define significant non-compliances with laws and regulations
based on internal materiality thresholds. This may include non-
compliances with laws and regulations that result in significant
health, safety, community, reputational, legal, or financial impacts.
Prosecutions, fines, or non-monetary sanctions are disclosed
where they relate to a reported significant non-compliance.
Rounding of amounts
South32 Limited is an entity to which the Australian Securities
and Investments Commission (ASIC) Corporations (Rounding
in Financial/Directors’ Reports) Instrument 2016/191 (ASIC
Instrument 2016/191) applies. We have rounded amounts in this
report in accordance with ASIC Instrument 2016/191. This means
the amounts in this report and the financial statements have been
rounded to the nearest million US dollars, unless stated otherwise.
Directors' report continued
78
SOUTH 32 ANNUAL REPORT 2024
Responsibility statement
The Directors state that to the best of their knowledge:
(a) The consolidated financial statements and notes on pages
110 to 167 were prepared in accordance with applicable
accounting standards, give a true and fair view of the assets,
liabilities, financial position, and profit and loss of the Group
and the undertakings included in the consolidation taken as a
whole; and
(b) The Directors’ report includes a fair review of the development
and performance of the business and the position of the Group
and the undertakings included in the consolidation taken as
a whole, together with a description of the principal risks and
uncertainties the Group faces.
This Directors’ report and the responsibility statement are made
in accordance with a resolution of the Board.
Karen Wood
Chair
Graham Kerr
Chief Executive Officer and Managing Director
Date: 29 August 2024
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
79
SOUTH 32 ANNUAL REPORT 2024
Lead Team
Graham Kerr
BBUS, FCPA, 53
Chief Executive Officer
and Managing Director
See page 70 for Graham Kerr’s
qualifications and experience.
Sandy Sibenaler
BCom, MFin, CA, GAICD, 42
Chief Financial Officer
Sandy Sibenaler joined
South32 in 2021 and became
our Chief Financial Officer in
April 2023, with responsibility
for Financial Reporting,
Management Reporting,
Treasury, Business Evaluation,
Tax, Investor Relations and
Group Assurance. Prior to
this role, Sandy was our Vice
President Finance.
Sandy has more than 20
years of treasury, finance
and commercial experience
in the resources sector. Prior
to joining South32, she held
a number of senior finance
and commercial roles at
Woodside and BHP including
Vice President of Treasury
and Insurance, General
Manager Logistics and Finance
Reporting Manager.
Sandy holds a Bachelor of
Commerce from the University
of Western Australia, a Master
of Finance from Kaplan
Business School, is a Fellow
of Chartered Accountants
Australia and New Zealand and
a Graduate of the Australian
Institute of Company Directors.
Vanessa Torres
BSc (Chemical), MEng, DEng,
GAICD 54
Chief Operating Officer
Australia
Vanessa Torres became our
Chief Operating Officer in
March 2024 and is responsible
for Worsley Alumina,
Cannington and Australia
Manganese. She joined
South32 in 2018 as our Chief
Technology Officer, and her
role was broadened to Chief
Technical Officer in 2020.
Before joining South32,
Vanessa was Vice President
Operational Infrastructure
for BHP Western Australia
Iron Ore. She has over 30
years of global mining
experience across Australia,
Canada, Brazil, Peru and
New Caledonia, and has held
various senior roles at BHP and
Vale in strategy, operations,
projects and business
development. Her multi-
commodity experience spans
base metals, bulk materials,
battery minerals and precious
metals.
Vanessa holds Doctorate and
Master degrees in Minerals
Engineering from the
University of Sao Paulo, and a
Bachelor of Science from the
Federal University of Minas
Gerais, Brazil. She was a
Visiting Scholar at the
University of British Columbia,
Canada, where her research
focused on the application of
artificial intelligence to the
mining industry. Vanessa is
also a Graduate of the
Australian Institute of
Company Directors.
Noel Pillay
NHDP Mech Eng, 56
Chief Operating Officer
Southern Africa and Colombia
Noel Pillay became our Chief
Operating Officer in October
2021 and is responsible for our
operations in Southern Africa
and Colombia.
Prior to this role, Noel was
Vice President Operations at
Worsley Alumina where he was
responsible for the operation’s
safety, production and cost
performance. Before his time
at Worsley Alumina, Noel was
Vice President Operations at
Hillside Aluminium in South
Africa.
Before joining South32, Noel
worked for BHP from 1994 as
a Maintenance Engineer at
Hillside Aluminium and has
held several leadership roles
in Maintenance, Production,
Business Improvement and
Human Resources in South
Africa and Australia.
Noel is a trained Mechanical
Engineer and holds a National
Higher Diploma from the
University of Johannesburg.
80
SOUTH 32 ANNUAL REPORT 2024
Simon Collins
BE (Mining), MBA, 51
Chief Development Officer
Simon Collins has been our
Chief Development Officer
since October 2018. He is
responsible for Exploration,
Corporate Development, Brazil
Alumina, Brazil Aluminium and
Sierra Gorda.
Simon has 30 years of
experience in the resources
industry in senior leadership,
commercial and business
development roles. Before
joining South32, he worked
for BHP for more than a
decade, providing leadership
to commercial and business
development teams in
Australia, Africa and the
Americas. He began his career
in mine operations in Australia
and then South Africa.
Simon holds a Master of
Business Administration from
London Business School and
a Bachelor of Engineering
(Mining) from the University of
New South Wales.
Erwin Schaufler
MSc, Mag.rer.soc.oec.,
GAICD, 48
Chief Technical Officer
Erwin Schaufler became our
Chief Technical Officer in
March 2024, with responsibility
for Technology, Innovation,
Business Optimisation, Global
Business Services, Capital
Projects, Planning, Health,
Safety, Environment and
Technical Stewardship.
Prior to this role, Erwin held
various leadership roles at
Worsley Alumina for more
than six years including Vice
President Operations and
General Manager Refinery.
Before his time at Worsley
Alumina, Erwin played a key
role in the establishment
of the Marketing function
when South32 was formed in
2015 and led the design and
implementation of a revised
Marketing strategy.
Before joining South32 Erwin
worked at BHP for eight years,
firstly in the Technology team
where he held various senior
roles before joining Marketing
in distribution and supply
chain in 2011.
Erwin holds a Master of
Science in Logistics and Supply
Chain from Cranfield University
in the United Kingdom, a
Magister rerum socialium
oeconomicarumque (Master
of Business Administration)
from Vienna University of
Economics and Business, is
a Graduate of the Australian
Institute of Company
Directors, and has completed
the Advanced Management
Program at INSEAD.
Kelly O’Rourke
LLB, BCom, MAICD, 45
Chief Legal and External
Affairs Officer
Kelly O’Rourke was appointed
to the Lead Team in November
2020 and is our Chief Legal
and External Affairs Officer,
with responsibility for Legal,
Company Secretariat, Business
Integrity, Communications,
Community, Government and
Sustainability Strategy.
Kelly joined South32 in 2016
as Vice President of Corporate
Affairs and Investor Relations.
She previously worked at BHP
for nine years where she held
senior roles in Legal, Business
Development, Mergers and
Acquisitions and the Office of
the Chief Executive.
Kelly has more than 20
years of experience in the
mining industry across
legal, commercial, business
development, mergers and
acquisitions, external affairs
and community roles across
Australia, Asia, the United
Kingdom, Europe, Africa and
the Americas.
Kelly holds a Bachelor of
Laws (Distinction) from
The University of Western
Australia, a Bachelor of
Commerce from Curtin
University and is a Member
of the Australian Institute of
Company Directors.
Katie Tovich
BCom, CA, GAICD, 54
Chief Human Resources and
Commercial Officer
Katie Tovich joined South32
in 2015 and became our
Chief Human Resources and
Commercial Officer in April
2023, with responsibility for our
Human Resources, Marketing
and Supply functions. Katie
was our Chief Financial Officer
from May 2019 to March 2023
and prior to this role, was Vice
President Corporate Affairs
and Investor Relations, as well
as Head of Treasury.
Katie brings more than 30
years of global experience in
the resources sector. Before
joining South32, she held
senior finance and marketing
roles at BHP in Australia and
Asia, including Vice President
Corporate Finance, Head of
Finance Worsley Alumina
and Vice President Finance
Marketing – Carbon Steel
Materials. Earlier in her mining
career, she held finance and
marketing leadership positions
at WMC Resources Limited in
Australia and North America.
Katie holds a Bachelor of
Commerce from the University
of Tasmania, is a Member
of Chartered Accountants
Australia and New Zealand and
is a Graduate of the Australian
Institute of Company Directors.
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81
SOUTH 32 ANNUAL REPORT 2024
From the Remuneration Committee Chair
On behalf of the Board, I’m pleased to
present the Remuneration report for FY24.
FY24 performance
Nothing is more important than the health,
safety and wellbeing of our people. In FY24
we worked to further embed our ‘safety
guarantee’ to instil a belief that everyone
can go home safe and well, create a sense
of chronic unease, reduce complacency,
and assist to reduce risk tolerance in
relation to safety and health.
We continued to implement our Safety
Improvement Program, a multi-year
program of work which aims to achieve a
step change in our safety performance,
and we use a range of metrics to assess
this including both leading and lagging
indicators. While we had no fatalities at
our operations in FY24 and our leading
indicators improved year-on-year, we
did not meet the targets for some of our
lagging indicators, indicating that we have
further work to do to eliminate serious
injuries from our business.
Effective risk management is an important
part of our approach to keeping our
people safe and well and we maintained
98 per cent compliance to our scheduled
risk routines, including undertaking risk
reviews, verifying controls and closing risk-
related actions.
We know an inclusive and diverse
workforce is safer and can enhance
performance. Our inclusion and diversity
measurable objectives are targets and
actions aimed at improving inclusion
and diversity in our workplace. While
we did not meet all of our targets,
the representation of women in our
overall workforce improved, as did
the representation of Black People in
our overall workforce in South Africa.
Pleasingly, our inclusion index score, which
is measured through our annual Your Voice
employee survey, improved year-on-year
to 82.3 per cent.
Other important sustainability measures
include our social and environmental
performance. We invested US$23.6 million
in community initiatives in Australia,
South Africa, Mozambique, Colombia
and the United States, and introductory
human rights training was completed by
95 per cent of targeted roles.
We view water as a vital shared resource
and are committed to working towards
sustainably managing water resources
within our operations, meeting or
exceeding the majority of our water-
related targets and milestones in FY24.
Against the backdrop of an uncertain
geopolitical and market environment, we
set consecutive annual production records
at two operations and lifted production
at Cannington by 10 per cent despite
adverse weather impacts. We finished the
year strongly, and delivered Underlying
earnings before interest, tax, depreciation
and amortisation of US$1.8 billion.
We returned US$198 million to
shareholders during FY24 via ordinary
dividends and our on-market share
buy-back. Consistent with our policy to
distribute a minimum of 40 per cent of
Underlying earnings as ordinary dividends,
the Board has resolved to pay a fully-
franked final ordinary dividend of US
3.1 cents per share (US$140 million) in
respect of the second half of FY24.
Reflecting the Group’s strengthened
financial position and our disciplined
approach to capital management, the
Board has also resolved to allocate
US$200 million to our ongoing capital
management program, to be returned to
shareholders via an on-market share buy-
back, commencing from completion of the
sale of Illawarra Metallurgical Coal.
This year, we achieved a major milestone
aligned with our strategy, by presenting
the Taylor zinc-lead-silver development
option at our Hermosa project to the
Board for a final investment decision, with
the Board approving its development.
As the first phase of a regional scale
opportunity at Hermosa, Taylor’s
infrastructure will unlock value for
future growth options including Clark,
our battery-grade manganese deposit,
and potential discoveries in our highly
prospective regional land package.
Taylor is now in the execution phase and
our immediate focus is the construction
of critical path infrastructure including
the main access and ventilation shafts,
which is on track to commence in the first
quarter of FY25.
We are also progressing Clark to potential
development via key workstreams and
have commenced construction of an
exploration decline to provide access to
ore for demonstration scale output.
Our performance during the year is
recognised in our Business Scorecard,
a key component of our short-term
incentive (STI), where an overall outcome
of 91.1 per cent (out of a possible
150 per cent) was achieved. See page 93
for more information.
CREATING VALUE
FOR OUR STAKEHOLDERS
The Remuneration Committee assists the Board to oversee the remuneration and
benefits framework for South32, providing assurance that remuneration
arrangements support the delivery of our purpose and strategy, are aligned to our
values and are in the long-term interests of our shareholders.
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SOUTH 32 ANNUAL REPORT 2024
FY24 reward outcomes
Our executive reward framework for FY24
remained unchanged and consisted of
fixed remuneration, STI and long-term
incentive (LTI).
In September 2023, fixed remuneration
increases were applied for our Executive
key management personnel (KMP), which
aligned with increases applied to the
broader workforce and were disclosed
in our 2023 Remuneration report. These
increases support us to remain market
competitive, as well as recognise the
performance and experience of our
Executive KMP.
For FY24, we adjusted the measures
in our Business Scorecard to increase
the weighting of safety and culture,
and environment and social measures,
while maintaining focus on financial
measures and strategic delivery.
Taking into consideration the Business
Scorecard outcome, the Board's decision
not to apply a Business Modifier, and
individual performance and behaviours,
the CEO STI outcome was 73 per cent of
maximum with other Executive KMP STI
outcomes ranging from 53 to 82 per cent
of maximum (see page 96 for more
information).
The LTI is the component of executive
remuneration most closely linked to the
shareholder experience as it rewards
executives for the delivery of returns
that exceed peer benchmarks across a
four-year period. South32 delivered a total
shareholder return (TSR) of 109 per cent
over the four-year performance period
of the FY21 LTI, resulting in a 33 per cent
vesting outcome (see page 97 for more
information).
The Board has approved the performance-
based Transitional LTI awards for Chief
Operating Officers Jason Economidis and
Noel Pillay to partially vest, noting this
award was granted to Jason and Noel
in FY22 when they were permanently
appointed to the Lead Team to avoid a
potential gap in vesting arising from their
transition from the Management Share
Plan to the LTI.
All LTI awards granted to permanent
members of the Lead Team, including
those designated as Executive KMP,
are subject to company performance
hurdles. However, we allow individuals
promoted into the Lead Team to retain
awards granted when they were in prior
management roles. As a result, our
Chief Financial Officer, Sandy Sibenaler,
continues to hold service-based awards
that were granted prior to joining the
Lead Team and becoming a member of
Executive KMP. The Board has approved
some of these awards to vest.
Our current LTI framework also includes
two strategic measures. The first of these
relates to our approach to climate change,
and in FY24 we continued to take action to
meet our target to halve our operational
greenhouse gas emissions (Scope 1 and
2) by 2035 from our FY21 baseline. The
second relates to portfolio management
and we have made substantial changes
to our portfolio in FY24 including entering
into an agreement to sell Illawarra
Metallurgical Coal, which is expected to
complete on 29 August 2024, unlocking
significant value and further streamlining
our portfolio toward base metals. We
also entered into agreements to sell
our 50 per cent interest in the Eagle
Downs metallurgical coal project and the
Metalloys manganese alloy smelter.
Looking forward to FY25
Following completion of our annual
benchmarking process, the Board
awarded a four per cent increase to the
fixed remuneration of our CEO to maintain
fixed remuneration at competitive levels
in alignment with our reward framework.
Increases of between four and six per cent
were awarded to other Executive KMP,
while Board fees for the Chair and other
Non-Executive Directors will increase by
2.5 and four per cent respectively. These
will take effect from 1 September 2024.
Our FY25 STI and LTI metrics will continue
to focus executives on the safe delivery
of our business priorities and the creation
of sustainable, long-term value for our
shareholders as we increase our exposure
to commodities critical for a low-carbon
future.
I look forward to continuing to engage with
our shareholders and sharing in the future
success of South32.
Wayne Osborn
Chair, Remuneration Committee
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SOUTH 32 ANNUAL REPORT 2024
Remuneration report
FY24 at a glance
Portfolio transformation:
Taylor development
final investment decision
Agreement to sell Illawarra
Metallurgical Coal
Four-year total shareholder return
(2)
:
109%
Underlying EBITDA
(1)
:
US$1,802M
Total shareholder return (TSR)
(3)
Diagram 1.1 - Four-year South32 TSR relative to key indices (A$)
South32 ASX100 FTSE100 S&P500
Total Shareholder Return
-20%
0%
20%
40%
60%
80%
100%
120%
140%
160%
180%
Jul-20 Jul-21 Jul-22 Jul-23 Jul-24
(1) This number has not been prepared in accordance with International Financial Reporting Standards (IFRS). Refer to pages 118 to 128 for the basis of the underlying information
and a reconciliation to statutory earnings.
(2) TSR calculation uses June 2020 average return at the start and June 2024 average return at the end of the measured period.
(3) Rolling 22 business day average TSR.
Table 1.1 outlines historic business performance outcomes.
Table 1.1 – Business performance
Performance measures
(1)
FY24 FY23 FY22 FY21 FY20
Underlying EBITDA (US$M)
(2)(3)
1,802 2,534 4,755 1,856 1,458
Underlying earnings (US$M)
(2)(3)(4)
380 916 2,602 489 193
Closing net cash/(debt) (US$M) (762) (483) 538 406 298
Movement in adjusted ROIC (percentage)
(5)
(5.0) (6.6) 0.4 0.7 0.0
Closing share price on 30 June (A$)
(6)
3.66 3.76 3.94 2.93 2.04
Dividends/special dividends paid (US cents per share) 3.6 21.9 14.2 2.4 5.0
Total recordable injury frequency (TRIF) (per million hours worked) 5.1 5.9 5.3 4.3 4.2
(1) The financial information in this table has not been prepared in accordance with IFRS. Refer to pages 118 to 128 for the basis of the underlying information and a reconciliation
to statutory earnings.
(2) The underlying information reflects the Group’s interest in material equity accounted investments and is presented on a proportional consolidation basis. Refer to pages 118 to
128 for the basis of the underlying information and a reconciliation to statutory earnings.
(3) On 29 February 2024, South32 announced the sale of 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 and held for sale from that date. Illawarra Metallurgical Coal remains part of the Group until
the sale's completion which is expected be on 29 August 2024. In the meantime, the Group's underlying financial results include the financial contribution from Illawarra
Metallurgical Coal.
(4) Refers to Underlying earnings attributable to members.
(5) The movement in adjusted ROIC (FY24: ((5.0 per cent)) is calculated as the difference between adjusted ROIC for the current performance period (FY24: 5.0 per cent) less ROIC
from the previous performance period (FY23: 10.0 per cent) and represents the impacts of sales volumes (FY24: (5.2 per cent)) and other business performance impacts (FY24:
0.2 per cent) on ROIC. ROIC is calculated as Underlying EBIT (FY23: US$1,616 million) less the discount on rehabilitation provisions included in 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 (FY23: US$657 million), divided by the
sum of the average balance of fixed assets and inventories (FY23: US$9,640 million) (including our material equity accounted investments on a proportional consolidation basis
(FY23: US$2,599 million) and excluding the average balance of any rehabilitation assets, the impact of impairment and impairment reversal, and unproductive capital (FY23:
US$(2,605 million))). Refer to pages 118 to 128 for the basis of underlying information and a reconciliation to statutory earnings.
(6) The closing share price on 28 June 2019 (the last trading day in FY19) was A$3.18.
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SOUTH 32 ANNUAL REPORT 2024
FY24 at a glance
Portfolio transformation:
Taylor development
final investment decision
Agreement to sell Illawarra
Metallurgical Coal
Four-year total shareholder return
(2)
:
109%
Underlying EBITDA
(1)
:
US$1,802M
Total shareholder return (TSR)
(3)
Diagram 1.1 - Four-year South32 TSR relative to key indices (A$)
(1) This number has not been prepared in accordance with International Financial Reporting Standards (IFRS). Refer to pages 118 to 128 for the basis of the underlying information
and a reconciliation to statutory earnings.
(2) TSR calculation uses June 2020 average return at the start and June 2024 average return at the end of the measured period.
(3) Rolling 22 business day average TSR.
Table 1.1 outlines historic business performance outcomes.
Table 1.1 – Business performance
Performance measures
(1)
FY24 FY23 FY22 FY21 FY20
Underlying EBITDA (US$M)
(2)(3)
1,802 2,534 4,755 1,856 1,458
Underlying earnings (US$M)
(2)(3)(4)
380 916 2,602 489 193
Closing net cash/(debt) (US$M) (762) (483) 538 406 298
Movement in adjusted ROIC (percentage)
(5)
(5.0) (6.6) 0.4 0.7 0.0
Closing share price on 30 June (A$)
(6)
3.66 3.76 3.94 2.93 2.04
Dividends/special dividends paid (US cents per share) 3.6 21.9 14.2 2.4 5.0
Total recordable injury frequency (TRIF) (per million hours worked) 5.1 5.9 5.3 4.3 4.2
(1) The financial information in this table has not been prepared in accordance with IFRS. Refer to pages 118 to 128 for the basis of the underlying information and a reconciliation
to statutory earnings.
(2) The underlying information reflects the Group’s interest in material equity accounted investments and is presented on a proportional consolidation basis. Refer to pages 118 to
128 for the basis of the underlying information and a reconciliation to statutory earnings.
(3) On 29 February 2024, South32 announced the sale of 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 and held for sale from that date. Illawarra Metallurgical Coal remains part of the Group until
the sale's completion which is expected be on 29 August 2024. In the meantime, the Group's underlying financial results include the financial contribution from Illawarra
Metallurgical Coal.
(4) Refers to Underlying earnings attributable to members.
(5) The movement in adjusted ROIC (FY24: ((5.0 per cent)) is calculated as the difference between adjusted ROIC for the current performance period (FY24: 5.0 per cent) less ROIC
from the previous performance period (FY23: 10.0 per cent) and represents the impacts of sales volumes (FY24: (5.2 per cent)) and other business performance impacts (FY24:
0.2 per cent) on ROIC. ROIC is calculated as Underlying EBIT (FY23: US$1,616 million) less the discount on rehabilitation provisions included in 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 (FY23: US$657 million), divided by the
sum of the average balance of fixed assets and inventories (FY23: US$9,640 million) (including our material equity accounted investments on a proportional consolidation basis
(FY23: US$2,599 million) and excluding the average balance of any rehabilitation assets, the impact of impairment and impairment reversal, and unproductive capital (FY23:
US$(2,605 million))). Refer to pages 118 to 128 for the basis of underlying information and a reconciliation to statutory earnings.
(6) The closing share price on 28 June 2019 (the last trading day in FY19) was A$3.18.
FY24 key management personnel (KMP)
Our KMP consist of our Board (including the Chief Executive Officer), and members of the Lead Team who have authority and
responsibility for planning, directing and controlling the activities of the Group directly or indirectly. Table 1.2 below provides an
overview of our KMP in FY24.
Table 1.2 – KMP in FY24
Non-Executive Directors FY24 Term Executive KMP FY24 Term
K Wood
(1)
Full year G Kerr – Chief Executive Officer (CEO) Full year
F Cooper AO
(1)
Full year S Sibenaler – Chief Financial Officer (CFO) Full year
X Liu Full year J Economidis
(2)
– Chief Operating Officer (COO) Australia Ceased on 13 March 2024
C Mesquita Full year V Torres – COO Australia
(3)
Appointed on 14 March 2024
N Mtoba Full year N Pillay – COO Southern Africa and Colombia Full year
J Nelson Full year
W Osborn
(4)
Full year
K Rumble
(1)
Full year
S Warburton Appointed on 28 Nov 2023
(1) Remuneration Committee member.
(2) Upon ceasing as a member of KMP, J Economidis transitioned into the role of Director Illawarra Metallurgical Coal.
(3) Prior to commencing as COO Australia, and a member of KMP, V Torres was Chief Technical Officer.
(4) Remuneration Committee Chair.
FY24 Executive KMP remuneration overview
CEO fixed remuneration
increase:
4.5%
Range of Executive KMP STI outcomes as a
percentage of maximum STI opportunity:
53% to 82%
FY21 LTI vesting
outcome:
33%
Fixed
remuneration
The Board awarded a 4.5 per cent increase to the fixed remuneration of our CEO, Graham Kerr, from 1 September 2023 in
recognition of his extensive experience and skill set. This adjustment aligned with the salary increase applied for the
broader Australian workforce.
Fixed remuneration for other Executive KMP was also increased by between 4.5 and six per cent. Increases were aligned
with those applied to the workforce in the relevant geographies (Australia and South Africa).
FY24 STI In FY24, our performance against our Business Scorecard measures resulted in an outcome of 91.1 per cent (out of a
possible 150 per cent). The Board determined that no Business Modifier would be applied to any Executive KMP in
FY24 (see page 95).
Overall STI outcomes for Executive KMP ranged from 53 per cent to 82 per cent of maximum with Graham receiving
73 per cent of maximum.
LTI vesting
in 2024
South32 delivered TSR of 109 per cent over the four-year performance period, which exceeded the world index TSR
by 30.5%, but was two per cent below the threshold level of TSR performance against the customised global mining
index. Accordingly, our Board approved one-third of the FY21 LTI award to vest and the remainder to lapse.
South32 does not offer retention rights to permanent members of the Lead Team, including those who are Executive
KMP. However, employees who are promoted into Executive KMP roles retain unvested awards granted under the
Management Share Plan (MSP) while in their prior role. These awards are a combination of performance rights and
retention rights. The FY21 MSP performance rights award granted to Sandy, Jason and Noel prior to their permanent
appointment to the Lead Team has the same performance conditions as the FY21 LTI. Accordingly, our Board
approved one-third of the award to vest and the remainder to lapse.
As the three-year service-based condition of the FY22 MSP retention rights award granted to Sandy prior to her
appointment to the Lead Team was met, our Board approved this award to vest in full.
Our Board approved the grant of an FY22 Transitional LTI award to Jason and Noel on their permanent appointments to
the Lead Team. This performance tested award is designed to address the potential shortfall in vesting that arises from
the transition from the MSP, which includes three-year retention rights, to the four-year LTI Plan. South32 relative TSR
performance over the three-year performance period resulted in a partial vesting outcome of 70.4 per cent (see page 97
for more detail).
FY24 realised pay Realised pay for the CEO (see page 86) was A$7.935M (FY23:$3.377M). The increase compared to FY23 reflects an
above target STI outcome and the LTI partially vesting for the first time since FY19.
The Board considered all components of remuneration in reviewing the FY24 reward outcomes to align with our
guiding principles (see page 87) and believes the FY24 realised pay for the CEO reflects performance (both in the
year and also across the four-year performance period for the LTI).
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SOUTH 32 ANNUAL REPORT 2024
Remuneration report continued
Realised pay for Executive KMP in FY24
Realised pay is the value of reward received by Executive KMP in relation to the financial year, rather than potential pay that may be
earned or disclosed statutory pay. We publish this information to enable shareholders to better understand the pay delivered to our
Executive KMP through our reward framework (including the application of Board discretion) and how this is aligned to the performance
of South32 over time.
The intention of our reward framework (see our guiding principles on page 87) is to deliver realised pay outcomes that reflect Company
performance, the contribution of the Executive KMP to that performance and the shareholder experience. The Board and Remuneration
Committee consider that our realised pay outcomes reflect this objective.
FY24 realised pay for Executive KMP, outlined in Table 1.3, includes:
– Fixed remuneration earned in FY24 (including superannuation);
– Other cash and non-monetary benefits earned in FY24;
– Total FY24 STI earned (including cash and deferred rights) based on performance during this financial year (see page 96); and
– LTI awards that vested based on performance and/or service conditions to 30 June 2024 (see page 99).
Realised pay is likely to vary substantially, either up or down, from statutory remuneration and from target remuneration (see page 90)
because a significant portion of our Executive KMP pay is ‘at risk’ and based on performance measures. Furthermore, as the LTI
is measured over a four-year performance period, vesting outcomes will not always correlate to the TSR outcomes for a single year. In
FY24, realised pay for the CEO exceeded target remuneration (see page 90) for the first time since FY19. The above target outcome was
primarily the result of strong total shareholder returns over the four-year LTI award performance period which resulted in one-third of
the FY21 LTI award vesting.
Table 1.3 – Realised pay in respect of FY24 (A$’000)
Executive KMP
Fixed
remuneration Other
(1)
STI cash STI deferred LTI
(2)(3)
Total realised
pay
G Kerr
FY24 1,978 56 1,306 1,306 3,289 7,935
FY23 1,891 48 719 719 - 3,377
S Sibenaler
(4)(5)
FY24 862 8 640 640 230 2,380
FY23 576 37 249 84 89 1,035
J Economidis
(6)
FY24 851 15 903 - 867 2,636
FY23 812 12 352 352 372 1,900
V Torres
(7)
FY24 862 29 474 474 841 2,680
FY23 - - - - - -
N Pillay
FY24 701 27 445 445 503 2,121
FY23 678 26 248 248 324 1,524
(1) Other includes such items as car parking, insurances and tax advice provided to Executive KMP.
(2) Value of the LTI is based on a closing share price on 28 June 2024 of A$3.66 (FY24) and 30 June 2023 of A$3.76 (FY23).
(3) LTI includes MSP awards granted to S Sibenaler, J Economidis and N Pillay prior to their permanent appointments to the Lead Team and Transitional LTI awards granted to J
Economidis and N Pillay following their permanent appointments to the Lead Team (see page 99).
(4) S Sibenaler became CFO and a member of Executive KMP on 1 April 2023. Prior to this, she was Vice President Finance. FY23 realised pay reflects nine months in her prior role
and three months as CFO.
(5) Other for S Sibenaler in FY23 includes the pro-rated pay out of a retention agreement of A$35,500 relating to her service as Vice President Finance that was paid prior to
becoming a member of Executive KMP.
(6) J Economidis ceased to be COO Australia and a member of the Executive KMP on 13 March 2024 and transitioned into the role of Director Illawarra Metallurgical Coal. FY24
realised pay includes the period as Director of Illawarra Metallurgical Coal. Should J Economidis cease employment upon completion of the sale of Illawarra Metallurgical Coal,
his employment contract in respect of his role as Director of Illawarra Metallurgical Coal provides for him to receive accelerated vesting of STI rights and for a pro rata portion
of his LTI rights to remain on foot and eligible for vesting in the ordinary course. No amounts have been included in the table above in respect of the potential accelerated
vesting of STI rights or apportioned LTI rights.
(7) V Torres became COO Australia and a member of Executive KMP on 14 March 2024. V Torres’ FY24 realised pay includes the period as Chief Technical Officer prior to becoming
a member of Executive KMP.
CEO Pay Ratio
As part of our commitment to pay transparency, we have calculated the ratio of our CEO’s total realised pay to the median total realised
pay for all our employees globally. This results in an FY24 CEO pay ratio of 57:1 (FY23 26:1). The pay ratio is expected to vary from year
to year, given the significant portion of our CEO’s pay which is ‘at risk’. The increase in the pay ratio between FY23 and FY24 reflects a
higher STI outcome and the LTI partially vesting for the CEO in FY24.
CEO total realised pay has been calculated in accordance with the method used in Table 1.3. For all other employees, realised pay is
for the 12-month period to 30 June 2024 and includes all allowances, annual incentive payments received and the value of shares that
vested in the period, but excludes other non-monetary benefits. Pension contributions have been calculated based on the cost to the
Group of the contributions made in the 12-month period. Employees on an international assignment, employees who have relocated
internationally during the financial year and employees who joined or left the Group after 1 July 2023 have been excluded from the
calculation.
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SOUTH 32 ANNUAL REPORT 2024
Our reward framework
The pages of the Remuneration report that follow (together with Table 1.1 – Business performance on page 84 and Table 1.2 – KMP
in FY24 on page 85) have been prepared in accordance with section 300A of the Corporations Act 2001 (Cth) (the Act) and audited
as required by section 308(3C) of the Act. These sections relate to those persons who were KMP of South32 during FY24, being the
individuals listed in Table 1.2 on page 85.
Remuneration governance
The roles and responsibilities of our Board, Remuneration Committee, management and external advisors in relation to remuneration for
Executive KMP and employees of South32 are outlined below.
Board Our Board maintains overall responsibility for overseeing the remuneration policy and the principles and
processes that underpin it. It approves the remuneration arrangements for our CEO and Non-Executive
Directors. Changes to the Director fee pool and equity grants to the CEO are approved by shareholders.
Remuneration Committee The Remuneration Committee approves reward arrangements for our executives including those
appointed to Executive KMP roles (other than the CEO).
By taking advice from other Board Committees (such as the Sustainability and Risk and Audit
Committees), the Remuneration Committee helps the Board oversee our remuneration policy, its specific
application to the CEO, Lead Team and Non-Executive Directors and, in general, our employees.
The Remuneration Committee provides oversight to gain assurance that remuneration arrangements are
equitable and aligned to the long-term interests of shareholders, operate within risk appetite and
support our purpose, strategy and values.
CEO and management Our CEO makes recommendations to the Remuneration Committee regarding our executives, and how
the remuneration policy and framework applies to our employees.
Management provides information and recommendations to the Remuneration Committee to help it
consider and implement approved arrangements.
External advisors Independent external advisors may be engaged either directly by the Remuneration Committee, or via
management. These advisors provide information on remuneration-related issues, including
benchmarking information and market data.
The Remuneration Committee did not receive recommendations from external advisors, including
remuneration consultants, in relation to KMP in FY24.
We seek information and analysis from a range of data sources. This allows us to make decisions that are informed, objective, weighted
and aligned to the requirements of the Company, and consistent with our guiding principles.
Reward practices and outcomes
Our Guiding Principles
Purpose
and Strategy
How we work Shareholders Performance Market
We align short-term and long-term
performance measures to our
purpose and strategy. This includes
our efforts to:
– Optimise our business by
working safely, minimising our
impact, consistently delivering
stable and predictable
performance and continually
improving our competitiveness;
– Unlock the full value of our
business through our people,
innovation, projects and
technology; and
– Identify and pursue
opportunities to sustainably
reshape our business for the
future, and create enduring
social, environmental and
economic value.
Our culture is grounded
in our values and is at
the core of how we
deliver our purpose and
strategy. You’ll see it
reflected in our values,
the decisions we take,
the courage we show
and the legacy we leave.
Supporting this is a
strong belief that
culture can be actively
shaped through a focus
on what we prioritise,
what we measure, what
we reward and who we
appoint.
Our reward framework
focuses executives and
management on
delivering superior TSR.
We do this through
share ownership and LTI
performance measures
aligned to the
shareholder experience.
We value feedback and
regularly engage with
investors and proxy
advisors.
Our reward outcomes
align to performance by
providing a large part of
executive pay ‘at risk’
based on financial and
non-financial measures.
STI outcomes reflect
performance over the
financial year, while LTI
outcomes reflect
performance over a
four-year period.
Our reward is designed
to be competitive and
to attract and retain
talented executives.
We benchmark our
reward levels by
considering similar
sized companies on the
Australian Securities
Exchange (ASX), as well
as our global mining
peer group.
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SOUTH 32 ANNUAL REPORT 2024
Remuneration report continued
Components of our reward for FY24
Our intention
Attract and retain
talented executives
to lead South32
The majority of pay at risk reflects our commitment to pay for performance
and deliver value to shareholders
Reward business and individual
performance in the financial year
Drive long-term performance
and ownership behaviours
Component Fixed Remuneration Short-Term Incentive Long-Term Incentive
The why
Fixed remuneration is
set with reference to
the median of our peer
groups, reflecting each
member of Executive
KMP’s responsibilities,
location, skills and
experience.
STI focuses efforts on our key priorities both
in the financial year and into the future. It
aims to motivate Executive KMP to achieve
challenging performance objectives. Our STI
reflects performance during the year and
measures outcomes within management’s
control.
LTI is directly linked to:
– Relative TSR so that Executive KMP pay outcomes are
aligned with the shareholder experience over the longer
term; and
– Two strategic measures so that Executive KMP pay
outcomes are aligned to the business priorities that we
believe will underpin the long-term success of South32.
The how
Base salary and
superannuation.
– Fifty per cent paid in cash annually.
– Fifty per cent delivered in rights to
receive South32 shares
(1)
, deferred
for two years
(2)
. For rights that vest,
Executive KMP are entitled to receive
a cash payment equivalent to the
dividends that would have been paid had
the Executive KMP held South32 shares
between the grant date and the date
the rights convert to South32 shares (a
dividend equivalent payment)
(3)
.
Rights to receive South32 shares
that are subject to meeting
performance conditions over the four-year performance period.
Our
approach
in FY24
We benchmark our
fixed remuneration
and target
remuneration against
two key peer groups
that reflect our profile
as a Company and the
markets in which we
operate and compete
for talent. Our peer
groups are:
– An ASX peer
group based on
companies with
half to double
our market
capitalisation
(excluding foreign
domiciled entities
and real estate
investment trusts);
and
– An international
mining peer
group of 16
companies with
a similar market
capitalisation,
commodity mix
and/or global
presence to
South32 (see Our
global mining peer
group below).
Quantum (percentage of fixed
remuneration):
Target value
Maximum
opportunity
Executive KMP 120% 180%
Business Scorecard: The Business
Scorecard reflects a balance of financial and
non-financial measures that are a priority in
the financial year. The financial measures
remove the impact of commodity prices and
foreign exchange so that we reward for
items management can control.
Performance measures:
■ Safety and culture (25%)
■ Environment and social (10%)
■ Financial (57.5%)
■ Strategic delivery (7.5%)
Business Modifier: As Scorecard measures
do not always reflect all aspects of
performance across a year, and to mitigate
any unintended reward outcomes, the Board
has the discretion to apply a Business
Modifier to the Business Scorecard
outcome. The Business Modifier may be
applied to Executive KMP on an individual or
group basis, having regard to the
perspectives of stakeholders including
employees, shareholders and communities.
Individual performance and behaviours:
The Board also considers an Executive
KMP’s individual performance, taking into
account their areas of responsibility and the
alignment of their behaviours with our
values (i.e. how outcomes have been
achieved).
Quantum (percentage of fixed remuneration):
The quantum for FY24 was determined by multiplying fixed
remuneration by the following face value percentages:
Target value Face value
CEO 120% 200%
Other Executive KMP 80% 133%
Performance measures:
■ TSR relative to EMIX Global Mining Index constituents
(53.3%)
■ TSR relative to MSCI World Index (26.7%)
■ Climate change strategic measure (10%)
■ Portfolio management strategic measure (10%)
TSR performance: Eighty per cent of the LTI is assessed based
on our TSR performance compared to two comparator groups,
these being:
– Two-thirds, or 53.3 per cent of the total award, is tested relative
to the TSR performance of the companies that comprise the
EMIX Global Mining Index at the start of the performance
period (i.e. at 1 July 2023 for the FY24 LTI award)
(4)
; and
– One-third, or 26.7 per cent of the total award, is tested
relative to the TSR of the MSCI World Index.
Strategic measures: The strategic measures, which each have
a weighting of 10 per cent of the LTI, are:
– Our response to climate change; and
– The transition of our portfolio towards commodities critical
to a low-carbon future.
More detail on the measures and our progress against them is
outlined on page 100.
Vesting scale:
Vesting outcome
(5)
0% 40% 100%
EMIX Global Mining
Index constituents*
TSR <= 50th
percentile
TSR > 50th
percentile
TSR => 75th
percentile
MSCI World Index*
TSR < index
TSR
TSR = index
TSR
TSR => index
TSR + 23.9%
Strategic
Measures
Vesting outcomes will be determined by the
Board at the end of the performance period.
*Vesting between 40 per cent and 100 per cent is on a straight-line basis.
The Board has the discretion to adjust the TSR vesting outcome
(both upwards and downwards) so that the overall vesting
outcome is appropriate and aligned with our guiding principles
(see page 87). There is no retesting if the performance condition
is not met at the end of the performance period.
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SOUTH 32 ANNUAL REPORT 2024
Our global
mining peer
group
The global mining peer group, used as one of our reference points for benchmarking FY24 fixed remuneration and total
reward levels, included the following companies:
Agnico Eagle Mines, Alcoa, Anglo American, AngloGold Ashanti, Antofagasta, Barrick Gold, First Quantum Minerals, Fortescue,
Freeport-McMoRan, Gold Fields, Kinross Gold, Lundin Mining, Newcrest Mining, Newmont, Northern Star Resources and Teck
Resources.
Minimum
shareholding
requirement
A minimum shareholding requirement (MSR), equal to 100 per cent of fixed remuneration for Executive KMP, drives a long-
term focus and alignment with our shareholders. The MSR applies to all Lead Team members, including those who are
Executive KMP, and must be obtained within five years of appointment to the Lead Team. The valuation approach applied to
determine the MSR uses the South32 Limited share price at the time the assessment is made. See page 107 for our Executive
KMP shareholdings.
Our service
contracts
Contracts are entered into by Executive KMP in their personal capacity. At present the key terms for all Executive KMP include:
– No fixed term;
– Six months’ notice by either party or payment by the company in lieu of notice;
– Termination without notice for serious misconduct;
– One month’s notice by the Executive KMP
(6)
where a fundamental change occurs that materially diminishes their status,
duties, authority or terms and conditions (receiving payment in lieu of six months’ notice);
– A maximum payment in lieu of notice of six months’ fixed remuneration; and
– Post-employment restraints for a period of up to six months after their employment with the Group ends.
Shareholder approval was granted at the 2021 Annual General Meeting (AGM) for Executive KMP termination benefits and will
be sought again at the 2024 AGM.
(1) References in this Remuneration report to ‘South32 shares’ are references to fully paid ordinary shares in South32 Limited.
(2) Deferred rights are subject to a service condition only as performance conditions are applied during the STI performance year.
(3) We introduced dividend equivalent payments on FY24 Deferred STI awards to increase the alignment between executives and shareholder interests during the STI deferral
period. The dividend equivalent payment will be paid in cash at the time the Deferred STI awards convert to shares. No dividend equivalent payment is payable in respect of
any rights that lapse.
(4) The constituent group is fixed for the four-year performance period with Board discretion to adjust the constituent group to take into account events such as takeovers,
mergers or demergers that may occur during the performance period.
(5) The Board and Remuneration Committee use information from an external provider to inform them of the TSR performance of the relevant index and companies to assess the
vesting outcome for the LTI.
(6) Some legacy executive employment contracts, including for the CEO, allow resignation without notice if a fundamental change occurs.
Linking reward and environmental, social and governance (ESG) topics
The ‘at risk’ components of our Executive KMP reward include ESG measures that align remuneration with our performance on ESG
topics, as explained below.
STI
The Business Scorecard reflects a balance of financial and non-financial measures that reflect the key focus areas in the financial year.
From an ESG perspective, 35 per cent of the FY24 Business Scorecard was assessed against ‘sustainability’ metrics, which include
safety and culture metrics (safety and health, risk management and people) and environment and social performance metrics (social
performance and water performance).
The overall Business Scorecard outcome is also subject to the Business Modifier. The Business Modifier allows the Board to
appropriately adjust the Business Scorecard outcome. We have a track record of applying the Business Modifier to reflect non-financial
performance and the overall shareholder experience (see page 95).
Further detail on our STI is included in the short-term incentive for FY24 section starting on page 92.
LTI
Twenty per cent of the FY24 LTI directly links executive reward to climate change and the transition of our portfolio towards
commodities critical to a low-carbon future. More detail on the strategic measures and our progress against them is outlined on page
100.
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Remuneration report continued
Target remuneration for FY24
South32 sets target remuneration for each member of Executive KMP at a competitive level to attract and retain appropriate talent in
the markets in which we operate. Our target remuneration is informed by the South32 reward framework (see page 87) that outlines the
key factors the Board takes into consideration in setting Executive KMP reward and the strategic drivers of pay at South32.
It is important that reward levels fairly reflect the responsibilities and contribution of the Executive KMP and that outcomes are aligned
to performance and the delivery of TSR. As a result, a meaningful portion of our Executive KMP remuneration is at risk, contingent on
individual and Company performance measures.
Target remuneration, as outlined below, assumes on-target performance for the STI and considers the difficulty of achieving LTI vesting
given the performance hurdles. The figures reflected in the diagram below are therefore based on the STI paid at target (120 per cent of
fixed remuneration) and the LTI vesting at 120 per cent of fixed remuneration which reflects the difficulty of achieving the performance
hurdles.
Based on these principles, target remuneration for Executive KMP as at 30 June 2024 is illustrated in Diagram 1.2.
Diagram 1.2 – FY24 target remuneration (A$’000)
(1)
2,389
694
685
694
566
1,195
520
514
520
424
1,195
520
514
520
424
1,991
867
856
867
707
0 2,000 4,000 6,000
G Kerr
6,770
(71% at risk)
S Sibenaler
2,601
(67% at risk)
J Economidis
2,569
(67% at risk)
V Torres
N Pillay
(2)
2,601
(67% at risk)
2,121
(67% at risk)
Fixed remuneration STI (cash) STI (deferred rights) LTI
(1) Target remuneration reflects a full year in the Executive KMP role.
(2) Target remuneration for N Pillay has been converted to A$ using an exchange rate of AUD: ZAR 12.27.
FY24 target remuneration relative to peer groups (unaudited)
We have operations and offices on six continents and compete for talent globally.
The diagrams below illustrate the measured approach we have adopted in positioning CEO fixed remuneration and target remuneration
for FY24 compared to relevant benchmarks, being the ASX peer group and the global mining peer group (see page 88). CEO fixed
remuneration is comparable to the median for both peer groups. CEO target remuneration is aligned to the upper quartile for the ASX
peer group, but below the global mining peer group median.
Diagram 1.3 – CEO fixed remuneration vs. peers Diagram 1.4 – CEO target remuneration vs. peers
0
1,000
2,000
3,000
ASX peers Global mining peers
A$’000
South32
1,991
0
3,000
6,000
9,000
12,000
ASX peers Global mining peers
A$’000
South32
6,770
South32 Median Upper and lower quartiles South32 Median Upper and lower quartiles
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SOUTH 32 ANNUAL REPORT 2024
Range of possible remuneration outcomes
As actual business and individual achievement over the performance period determines reward outcomes, the pay received by
Executive KMP each year will vary.
Diagram 1.5 illustrates the range of possible remuneration outcomes for the CEO, based on three performance outcome scenarios:
minimum, target and maximum. While the figures in Diagram 1.5 and explanation are for the CEO, similar analysis can be undertaken for
other Executive KMP to assess the minimum and maximum range of pay outcomes.
Diagram 1.5 – Range of CEO remuneration outcomes (A$’000)
Fixed remuneration STI (cash) STI (deferred rights) LTI
0
2,000 4,000 6,000 8,000 10,000
6,770
(71% at risk)
Minimum
Target
(1)
Maximum
9,557
(79% at risk)
2,389
3,982
1,195
1,792
1,195
1,792
1,991
1,991
1,991
(1) The target LTI value reflects the difficulty of achieving the performance hurdles.
In the Minimum scenario, no STI or LTI is paid. The CEO would receive fixed remuneration, inclusive of superannuation, of A$1,991,000.
Target outcomes would be achieved where the business meets the STI performance measures, resulting in the STI being paid at
target levels (120 per cent of fixed remuneration, with half deferred into rights) and the LTI vesting at target (120 per cent of fixed
remuneration).
To deliver a Maximum outcome for the STI (i.e. 180 per cent of fixed remuneration, with half deferred into rights), South32 would
need to achieve the stretch targets for every metric in the Business Scorecard. For the LTI to vest in full (i.e. at 200 per cent of fixed
remuneration), over the four-year performance period:
– The South32 TSR would need to meet or exceed the TSR of the company at the 75th percentile in the EMIX Global Mining Index
constituent group;
– The South32 TSR would need to exceed the MSCI World Index by 23.9 per cent; and
– The Board would need to assess performance against both strategic measures as outstanding.
Deferred STI and LTI in the Target and Maximum scenarios do not incorporate future share price movements or any dividend equivalent
payments that may be made on Deferred STI awards.
Fixed remuneration for FY24
On 1 September 2023, the CEO received an increase to fixed remuneration of 4.5 per cent from A$1,906,000 to A$1,991,000 in
recognition of his extensive experience and skill set. This was his third increase in fixed remuneration since commencing in role in 2015.
Sandy, Jason and Noel received fixed remuneration increases of between 4.5 and six per cent which aligned with the increases applied
to the broader workforce in the relevant geographies (4.5 per cent in Australia and six per cent in South Africa).
Table 1.4 – Fixed remuneration for Executive KMP in FY24, effective 1 September 2023
(1)
Executive KMP FY23 fixed remuneration FY24 fixed remuneration
Increase
%
G Kerr A$1,906,000 A$1,991,000 4.5
S Sibenaler
(2)
A$830,000 A$867,000 4.5
J Economidis
(3)
A$819,000 A$856,000 4.5
V Torres
(4)
- A$867,000 -
N Pillay
(5)
ZAR 8,190,000 ZAR 8,680,000 6.0
(1) Fixed remuneration reflects a full year in the Executive KMP role.
(2) FY23 fixed remuneration for S Sibenaler was effective from commencing as CFO and a member of Executive KMP on 1 April 2023.
(3) FY24 fixed remuneration for J Economidis was effective until he ceased to be COO Australia and a member of Executive KMP on 13 March 2024.
(4) FY24 fixed remuneration for V Torres was effective from commencing as COO Australia and a member of Executive KMP on 14 March 2024.
(5) Fixed remuneration for N Pillay is denominated in ZAR. Using an exchange rate of AUD:ZAR 12.27, FY24 fixed remuneration is A$707,416.
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Overall
STI Outcome
Target: 120%
Maximum: 180%
(of fixed remuneration)
3
Individual
Outcome
INDIVIDUAL PERFORMANCE
AND BEHAVIOURS
0%-150%
2
South32
Business Outcome
BUSINESS
SCORECARD
0%-150%
Target 100%
BUSINESS
MODIFIER
Discretion +/-
x
1A 1B
x =
Remuneration report continued
Short-term incentive for FY24
Determining STI awards
Diagram 1.6 – Determination of STI awards
As outlined on page 88, the STI is intended to focus and reward Executive KMP for delivering on our key business priorities both in the
financial year and into the future. The overall STI outcome is determined by assessing three key inputs: the Business Scorecard, the
Business Modifier and individual performance and behaviours.
The Business Scorecard includes a balanced range of measures that consider both our financial and non-financial performance, and
help our Executive KMP focus on outcomes that are within their control and a priority for the year.
The Business Modifier considers overall business outcomes or other factors that are not specifically contemplated in the Business
Scorecard, such as:
– Significant safety or environmental events;
– The shareholder experience;
– Significant reputational issues; and
– An assessment of risk, culture or any other item that the Board considers appropriate.
The Business Modifier, based on Board discretion, adjusts the overall Business Scorecard outcome so that STI outcomes reflect
business performance, including both what has been delivered and how it has been achieved. The outcome may be positive or negative
and may be applied to Executive KMP on an individual or a group basis depending on the factors under consideration.
Together, the Business Scorecard and the Business Modifier determine the South32 Business Outcome.
Individual performance is measured based on delivery against the relevant business plans. Executives are also assessed on
demonstrated behaviour aligned to our values (i.e. both on what is achieved and how it is achieved).
What this means in practice
Our Business Scorecard includes measures that are within
our executives' control, and, as such, will not always mirror
underlying South32 financial outcomes. Diagram 1.7 outlines
the CEO's STI outcomes approved by the Board over the past
five years.
In FY24, we maintained a strong focus on cost management
and achieved a number of production records across our
business. However, Underlying earnings was impacted by
weaker commodity prices and lower production volumes,
predominantly at Illawarra Metallurgical Coal, where we
completed planned longwall moves, and at Australia
Manganese due to Tropical Cyclone Megan.
Our Business Scorecard outcome of 91.1 per cent reflected
a target outcome for our sustainability focused metrics,
but a below target outcome for our financial metrics, driven
primarily by our adjusted ROIC performance (refer to pages
93 and 94). The CEO’s STI outcome incorporated the Business
Scorecard outcome, the Board’s decision not to apply a
Business Modifier (refer page 95), and a 120 per cent individual
outcome in recognition of Graham’s outstanding leadership
during the year (refer page 96).
Diagram 1.7 – CEO STI outcome vs. Underlying earnings
(1)
42%
73%
South32 Underlying earnings US$M STI % of maximum
-
FY20 FY21 FY22 FY23 FY24
US$M
STI % of maximum
500
1,000
1,500
2,000
2,500
3,000
0%
25%
50%
75%
100%
42%
54%
74%
(1) Refers to Underlying earnings attributable to members.
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SOUTH 32 ANNUAL REPORT 2024
1A
FY24 Business Scorecard
Table 1.5 – FY24 Business Scorecard outcomes
Scorecard measure Performance Zero Target Maximum Ta rget Outcome
Safety and culture 25.0% 23.3%
Safety and health
(1)
At least 90 per cent of LEAD Safely Every Day learning
activities completed by leaders.
A significant hazard to significant event near miss
reporting ratio of more than 15.
A 20 per cent reduction in the number of people
exposed to potential material health exposures above
200 per cent of the occupational exposure limit (OEL)
compared to the FY23 baseline.
A 60 per cent reduction in the number of injuries and
acute illnesses associated with a potential fatality
compared to the FY23 baseline.
A year-on-year reduction in lost time injury frequency
(LTIF ).
A reduction in TRIF from the FY22 baseline.
96 per cent of LEAD Safely Every Day learning activities were
completed by leaders.
The significant hazard to significant event near miss ratio at the
end of FY24 was 21.
Potential material health exposures above 200 per cent of OEL
decreased by 10.5 per cent compared to the FY23 baseline.
The number of injuries and acute illnesses associated with a
potential fatality increased by 12 per cent compared to the FY23
baseline.
LTIF was 1.9, an increase from the FY23 LTIF of 1.6.
TRIF was 5.1, which is a five per cent reduction compared to the
FY22 baseline.
15.0% 11.6%
Risk management
Maintain more than 95 per cent compliance to
scheduled risk routines.
Risks requiring significant improvement are less than
10 per cent of the total material risk profile.
More than 95 per cent of current critical controls are
categorised against the hierarchy of controls.
Delivered 98 per cent compliance to scheduled risk routines.
Risks requiring significant improvement averaged seven per cent of
the total material risk profile.
99 per cent of current critical controls were categorised against the
hierarchy of controls.
In addition, four of the five stretch targets were met.
5.0% 6.5%
People
(1)
Achieve our annual inclusion and diversity targets.
Deliver all activities on the annual inclusion and
diversity action plan.
Maintain or improve average inclusion index score
compared to FY23.
One out of four of the targets for the representation of women in
our workforce
(2)
and one out of two of the targets for the
representation of Black People in our South African workforce were
achieved.
Our pay equity review was completed, investing US$292,000 to
improve pay equity and meeting our target.
All activities on the annual inclusion and diversity action plan were
completed.
Our inclusion index score, as measured in the Your Voice employee
survey, improved by 0.8 per cent compared to FY23
(3)
, which
exceeded target.
5.0% 5.2%
Environment and social 10.0% 11.8%
Social performance
(1)
Implement social investment plans on time and on
budget.
Apply our social investment impact measurement
framework to our Hotazel Manganese Mines and
Hillside Aluminium economic development plans.
Introductory human rights training completed by all
targeted roles and made available to the wider
workforce.
Social investment plans were implemented on time and on budget
and we invested US$23.6M in community initiatives.
The social investment impact measurement framework was applied
to the Hotazel Manganese Mines and Hillside Aluminium economic
development plans.
Introductory human rights training was completed by 95 per cent
of targeted roles and made available to the wider workforce.
5.0% 4.9%
Water performance
(1)
Deliver contextual water target milestones to agreed
plan and achieve the FY24 target water use efficiency
outcome as defined within our Sustainability Linked
Loan (SLL) framework.
Six out of seven contextual water target milestones were met and
we exceeded the FY24 stretch outcome for water use efficiency as
defined within the SLL.
5.0% 6.9%
(1) Further information on this Business Scorecard measure can be found in the Our strategy in action section on pages 20 to 27 and/or our Sustainable Development Report 2024
at www.south32.net.
(2) The representation of women on our Board is excluded from the Business Scorecard People metric given it is not within management’s control.
(3) Given the agreement to sell Illawarra Metallurgical Coal and focus on recovery efforts following Tropical Cyclone Megan at Australia Manganese, employees at these operations
did not participate in this year's Your Voice employee survey. Survey results presented in this report are calculated on re-baselined data to support year-on-year comparison
against the same operations in scope.
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Remuneration report continued
Scorecard measure Performance Zero Target Maximum Ta rget Outcome
Financial 57.5% 48.9%
Production
(4)
Achieve 97 to 102 per cent of target revenue
equivalent production.
Revenue equivalent production was 96.5 per cent of target.
15.0% 14.3%
Controllable cost
(4)
Deliver controllable costs that are within 2.5 per cent of
target (adjusted for foreign exchange, price-linked
costs, and other adjustments).
Controllable costs were within 1.7 per cent of target, reflecting a
saving of US$44M.
10.0% 10.0%
Capital expenditure
(4)
Capital expenditure (excluding growth) is within five
per cent of target (adjusted for foreign exchange).
Growth capital expenditure is within 10 per cent of
target.
Capital expenditure (excluding growth) was 94 per cent of target.
Growth capital expenditure was 93 per cent of target.
7.5% 7. 4%
Adjusted ROIC
(5)
Achieve target adjusted ROIC, consistent with our cost,
production and capital expenditure targets.
Adjusted ROIC was 69 per cent of target.
25.0% 17.2 %
Strategic delivery 7.5% 7.1%
Hermosa project
(6)
Taylor. Complete shaft pre-sink to plan, present
project for final investment decision (FID) and
commence and progress shaft development to plan.
Clark. Progress engineering and federal funding
submission for the proposed plant on schedule.
Progress decline development to plan.
Taylor. The shaft pre-sink was completed on schedule. The project
was presented for FID in February 2024 (and approved).
Construction of the main access and ventilation shafts is on track to
commence in the first quarter of FY25.
Clark. Engineering design studies on the proposed plant for the
next phase of metallurgical testing commenced. A request for
federal funding was submitted. Construction of an exploration
decline commenced.
7.5% 7.1%
Total 100% 91.1%
(4) Excludes non-operated entities (Sierra Gorda, Brazil Alumina and Brazil Aluminium). In line with our standard approach which removes factors outside management's control,
the outcome includes adjustment for material weather related events.
(5) Includes non-operated entities (Sierra Gorda, Brazil Alumina and Brazil Aluminium). In line with our standard approach which removes factors outside management's control,
the outcome includes adjustment for material weather related events.
(6) Further information on this Business Scorecard measure can be found in the Our strategy in action section on pages 20 to 27.
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SOUTH 32 ANNUAL REPORT 2024
1B
FY24 Business Modifier
The Board has discretion to adjust the overall Business Outcome by applying the Business Modifier. In considering the application of the
Business Modifier for FY24, the Board was primarily focused on three things. First, the impact of Tropical Cyclone Megan on Australia
Manganese, second, the impairment expense for Worsley Alumina, and third, the impairment expense for Cerro Matoso.
The Board deliberated on the circumstances relating to the impact of Tropical Cyclone Megan on the operations at Australia
Manganese, which resulted in operations being temporarily suspended. The severe weather system developed quickly, resulting in
record rainfall that flooded mining pits, and caused significant damage to critical infrastructure. The Company's insurers have confirmed
that the damage caused by Tropical Cyclone Megan is covered under our insurance and we continue to work with our insurers to assess
the timing and value of recoveries under these policies.
The Board considered the July 2024 Western Australian Environmental Protection Authority (WA EPA) assessment report, which
recommended that the Worsley Mine Development Project may be implemented, subject to conditions. The environmental approval
process, which commenced in 2019, involved extensive environmental assessment and consultation with a range of stakeholders.
Several of the recommended conditions go beyond reasonable measures for managing the environmental risks of the proposal based
on scientific assessment and decades of operating experience, are not practicable, and are inconsistent with other governmental
regulation and policy. Worsley Alumina has lodged an appeal in relation to the WA EPA assessment report and aims to secure
environmental approvals for the project by the end of 2024. As a result of the recommended conditions, we recognised an impairment
expense for Worsley Alumina that reflects increased uncertainty for the project approval and associated challenging operating
conditions.
Finally, the Board reviewed the circumstances leading to the impairment expense for Cerro Matoso which reflected structural changes
in the nickel market that are expected to continue to place pressure on nickel prices and discounts for our ferronickel product.
After carefully considering all the circumstances leading up to the damage at Australia Manganese, and the impairment expenses at
Worsley Alumina and Cerro Matoso, the Board formed the view that they were outside the control of management and that no Business
Modifier would be applied to any Executive KMP.
Table 1.6 outlines the Business Modifiers the Board has applied to the Business Scorecard for each Executive KMP role over the last five
years.
Table 1.6 – Application of the Business Modifier by the Board (multiplier applied to the Business Scorecard outcome)
Modifier for Modifier applied in previous years
FY24 FY23
(1)
FY22
(2)
FY21 FY20
CEO
-
-25% -20% -20% -30%
COO Southern Africa
and Colombia
-20%
-20%
-20% -30%
-10%
Other Executive KMP
-10% -10%
-5% -15%
-5% -5%
(1) In FY23, the Board decided to apply a Business Modifier of -10 per cent for J Economidis, and a Business Modifier of negative five per cent for other Executive KMP.
(2) In FY22, the Board decided to apply a Business Modifier of -20 per cent for the COO Southern Africa and Colombia at the time of the fatality, a Business Modifier of -10 per cent
for J Economidis and N Pillay, and a Business Modifier of negative five per cent for the CFO.
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Remuneration report continued
2
FY24 individual performance
Our Board considers the individual scorecard outcomes for Executive KMP with regard to what was delivered and how it was delivered.
The Board recognised Graham's outstanding leadership and development of his Lead Team. Furthermore, the Board recognised his
personal impact in leading our improved safety performance and the further transformation of our portfolio towards commodities
critical to a low carbon future.
Individual outcomes applied to the other Executive KMP reflected the performance in their areas of accountability and development in
their respective roles. These outcomes ranged from 88 per cent to 135 per cent, as indicated in Table 1.7 below.
3
Overall FY24 STI outcome
Overall STI outcomes for FY24 are determined through our Board’s assessment of the business and individual outcomes, as outlined in
Table 1.7.
Table 1.7 – STI earned by Executive KMP in respect of FY24 performance
Business
Scorecard
Outcome %
Business
Modifier
+/- %
Individual
Outcome %
Overall STI
Outcome
(% of Target)
Total STI
Awarded Cash
Deferred
rights
Percentage of maximum STI
Awarded Forfeited
Executive KMP (1A) (1B) (2) 1A x (1+1B) x (2) (A$’000) (A$’000)
(1)
(A$’000)
(1)
(%) (%)
G Kerr 91.1 - 120 109.3 2,612 1,306 1,306 73 27
S Sibenaler 91.1 - 135 123.0 1,280 640 640 82 18
J Economidis
(2)
91.1 - 88 80.2 578 578 - 53 47
V Torres
(3)
91.1 - 100 91.1 282 141 141 61 39
N Pillay
(4)
91.1 - 115 104.8 890 445 445 70 30
(1) The cash portion of the STI will be paid in September 2024. The deferred rights to South32 shares are anticipated to be granted in or around December 2024 and will be due to
vest in August 2026. A dividend equivalent payment will also be made when the rights vest. The deferred rights remain subject to continued service with the Group.
(2) J Economidis ceased to be a member of Executive KMP on 13 March 2024. Details in the above table are for his period as a member of Executive KMP. J Economidis' overall STI
outcome for the period as Director IMC, which is not reflected in the table, was 106 per cent. The entire value of his FY24 STI will be paid in cash in September 2024.
(3) V Torres was appointed as a member of Executive KMP on 14 March 2024. Details in the above table are for her period as a member of Executive KMP.
(4) The total STI awarded, cash and deferred rights values for N Pillay are denominated in ZAR and have been converted to A$ using an exchange rate of AUD: ZAR 12.27.
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Long-term incentive
FY21 LTI and MSP Performance award
Our FY21 LTI award was tested subject to performance conditions over a four-year period from 1 July 2020 to 30 June 2024 and
continued service until the vesting date. Two-thirds of the award was subject to TSR performance over the four-year period with
reference to a global mining index (the IHS Markit Global Mining Index, constrained by company and sector
(1)
). For the LTI awards
granted from FY16 to FY21, we used a customised IHS Markit Global Mining Index as a TSR performance comparator. The index is
customised by applying a cap on the index weight of each individual company and the index weight of each sector (such as gold) except
the diversified mining sector, which is excluded from capping and redistribution. Applying these limits results in a rebalancing across the
remaining companies and sectors in the index.
The remaining one-third was subject to TSR performance over the four-year period measured with reference to a world index (the MSCI
World Index).
Sandy, Jason and Noel were granted the FY21 MSP Performance award prior to their permanent appointments as members of the Lead
Team. This award has the same performance and vesting conditions as our FY21 LTI award.
For the LTI and MSP Performance awards to vest in full, our TSR performance needed to outperform both indices by at least
23.9 per cent over the four-year performance period (equivalent to 5.5 per cent per annum cumulative). Our TSR exceeded the world
index TSR by 30.5 per cent, but failed to meet the threshold level of performance required against the global mining index (see Diagram
1.8 and Table 1.8). As a result, our Board approved one-third of the awards to vest and the remainder to lapse.
Diagram 1.8 – South32 TSR relative to comparator groups (A$) Diagram 1.9 – Vesting scale
South32 Global mining index World index
Total Shareholder Return
-20%
0%
20%
40%
60%
80%
100%
120%
140%
160%
180%
Jul-20 Jul-21 Jul-22 Jul-23 Jul-24
100% vesting
40% vesting
0% vesting
TSR = index
TSR
TSR => index TSR
by 23.9%
Table 1.8 – South32 FY21 LTI and MSP Performance award vesting outcomes
TSR performance
(1)(2)
Vesting
outcome
Index
weighting
Weighted
vesting outcome
Index
(A)
South32
(B)
Required for
100% vesting
Achieved
(B-A) (C) (D) (C x D)
Global mining index 111.0%
109%
Index+23.9% (2.0%) 0% 2/3 0%
World index 78.5% Index+23.9% 30.5% 100% 1/3 33.3%
33.3%
(1) TSR calculation uses June 2020 average return at the start and June 2024 average return at the end of the measured period.
(2) The Board and Remuneration Committee use information from an external provider to inform them of the performance of the relevant index to assess the vesting outcome.
FY22 MSP Retention award
Although South32 does not offer MSP Retention awards to permanent members of the Lead Team, including those who are Executive
KMP, when individuals are promoted to Lead Team roles, they retain any unvested MSP awards that may vest while they are members of
KMP. Sandy was granted an FY22 MSP Retention award prior to her appointment as a member of the Lead Team. As the service-based
condition of this award was met, our Board approved this award to vest in full.
The structure of the MSP is detailed on page 107.
(1) Following the decommissioning of the IHS Markit Global Mining index on 31 July 2023, the Board and Remuneration Committee considered a range of alternative global mining
sector measures. The Board determined that the S&P Global Mining index, customised to apply constraints which cap the weight of each sector except the diversified mining
sector, was the most suitable replacement to assess performance for the remainder of the performance period. This was due to its close performance correlation to the IHS
Markit Global Mining index (on a customised basis) over the period 1 July 2020 to 31 July 2023.
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SOUTH 32 ANNUAL REPORT 2024
Remuneration report continued
FY22 Transitional LTI award
We granted the FY22 Transitional LTI awards to Jason and Noel on their permanent appointments to the Lead Team. The award was
designed to address the potential shortfall in vesting in August 2024 that arises from the transition from the MSP, which includes
Retention awards with a three-year service period condition, to the four-year performance period of the LTI.
This Transitional LTI award was subject to the same TSR performance conditions as the FY22 LTI award, but over a three-year period.
Two-thirds of the award was measured with reference to a global mining index (the constituents of the IHS Markit Global Mining Index at
the start of the performance period) and one third with reference to a world index (the MSCI World Index). The performance period for
this award was from 1 July 2021 to 30 June 2024. For the Transitional LTI award to vest in full, our TSR performance needed to:
– Equal or exceed the TSR of the company at the 75th percentile when ranking the TSR of the constituents of the IHS Markit Global
Mining Index at the start of the performance period (refer Diagram 1.11 for further information on the vesting scale); and
– Outperform the MSCI World Index by at least 17.4 per cent over the performance period, equivalent to 5.5 per cent per annum
cumulative (refer Diagram 1.12 for further information on the vesting scale).
Our TSR ranked at the 66th percentile amongst the global mining sector index constituents and outperformed the MSCI world index by
3.9 per cent (see Diagram 1.10 and Table 1.9). As a result, our Board approved 70.4 per cent of the rights to vest and the remainder to
lapse.
Diagram 1.10 – South32 TSR relative to comparator groups Diagram 1.11 – Global mining index constituents
vesting scale
-20%
0%
20%
40%
60%
80%
100%
Jul-21 Jul-22 Jul-23 Jul-24
Total Shareholder Return
South32 (A$)
World index (A$)
Global mining index median constituent
Global mining index 75th percentile constituent
100% vesting
40% vesting
0% vesting
TSR > median
constituent
TSR
TSR => 75
th
percentile
constituent TSR
Diagram 1.12 –World index TSR vesting scale
100% vesting
40% vesting
0% vesting
TSR = index
TSR
TSR => Index
by 17.4%
Table 1.9 – South32 FY22 Transitional LTI award vesting outcomes
TSR performance
(1)(2)
Vesting
outcome
Metric
weighting
Weighted
vesting outcome
Required
for 40% vesting South32
Required for 100%
vesting Achieved (C) (D) (C x D)
Global mining index constituents >50th Percentile
(3)
46.6%
75th Percentile
(4)
66th Percentile 78.9% 2/3 52.6%
World index 42.7%
(5)
Index+17.4% 3.9% 53.4% 1/3 17.8%
70.4%
(1) TSR calculation uses June 2021 average return at the start and June 2024 average return at the end of the measured period.
(2) The Board and Remuneration Committee use information from an external provider to inform them of the TSR performance to assess the vesting outcome.
(3) The TSR of the company at the 50th percentile in the constituent group over the three year performance period was 19.1 per cent.
(4) The TSR of the company at the 75th percentile in the constituent group over the three year performance period was 75.3 per cent.
(5) Reflects the MSCI World Index TSR over the three year performance period.
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SOUTH 32 ANNUAL REPORT 2024
Summary of LTI outcomes in FY24
Table 1.10 – South32 LTI awards vested or lapsed
Executive KMP Award
Number of
rights granted
Number of
rights vested
Number of
rights lapsed
Value at
grant
(1)
(A$'000)
Value
lapsed
(2)
(A$'000)
Value of
share price
movement
(3)
(A$'000)
Value at
vesting
(4)
(A$'000)
G Kerr F Y21 LTI 2,695,544 898,514 1,797,030 5,445 3,630 1,474 3,289
S Sibenaler
FY21 MSP Performance 59,405 19,801 39,604 120 80 32 72
FY22 MSP Retention 43,246 43,246 - 124 - 34 158
J Economidis
FY21 MSP Performance 495,049 165,016 330,033 1,000 667 271 604
FY22 Transitional LTI 102,094 71,874 30,220 293 87 57 263
V Torres FY21 LTI 689,108 229,702 459,406 1,392 928 377 841
N Pillay
FY21 MSP Performance 215,655 71,885 143,770 436 290 117 263
FY22 Transitional LTI 93,034 65,495 27, 539 267 79 52 240
(1) ‘Value at grant’ is the number of rights granted multiplied by the grant determination price in June 2020 of A$2.02 (for the FY21 LTI/FY21 MSP Performance) and June 2021 of
A$2.87 (for the FY22 MSP Retention/FY22 Transitional LTI), based on the volume weighted average price (VWAP) of South32 shares traded on the ASX over the last 10 trading
days in June of the respective year.
(2) ‘Value lapsed’ is the number of rights lapsed/forfeited based on performance relative to the performance measures, multiplied by the grant determination price of A$2.02 (for
the FY21 LTI/FY21 MSP Performance) and A$2.87 (for the FY22 MSP Retention/FY22 Transition LTI).
(3) ‘Value of share price movement’ is the number of shares that vested, multiplied by the difference between the grant determination price of A$2.02 (for the FY21 LTI/FY21
MSP Performance) and A$2.87 (for the FY22 MSP Retention/FY22 Transitional LTI) and the share price at 30 June 2024 of A$3.66. This reflects the value added/(lost) due to the
change in share price over the performance period.
(4) ‘Value at vesting’ is the number of shares approved to vest, multiplied by the closing share price of South32 shares on 30 June 2024 of A$3.66.
LTI granted in FY24
FY24 LTI Plan
Each year we grant performance rights to our Executive KMP. Our FY24 LTI Plan awards, which were granted in December 2023, have
a four-year performance period and are subject to performance hurdles (see page 88). Shareholders approved, under ASX Listing Rule
10.14, the grant of rights for the CEO at the AGM on 26 October 2023.
FY24 Transitional LTI
In FY24, the Remuneration Committee approved a one-off Transitional LTI award for Sandy following her appointment to the Lead Team.
The award is designed to address the potential shortfall in vesting in August 2026 that arises from the transition from the MSP, which
includes Retention awards with a three-year service period condition, to the four-year performance period of the LTI.
This award is performance based and has the same TSR performance conditions as the FY24 LTI but is measured over a three-year
period. More information on this award is provided on page 107.
Table 1.11– FY24 LTI and Transitional LTI grants
Reward determination
(1)
Executive KMP Award
Face value
(% of fixed
remuneration)
Face value
(A$’000)
Target value
(2)
(% of fixed
remuneration)
Target value
(A$’000)
Grant (December
2023):
Number of rights
granted
(3)
Anticipated
vesting date
G Kerr F Y24 LTI 200 3,982 120 2,389 1,047,894 August 2027
S Sibenaler
FY24 LTI 133 1,153 80 694 303,450 August 2027
FY24 Transitional LTI 37. 5 325 20 173 85,559 August 2026
J Economidis FY24 LTI 133 1,138 80 685 299,600 August 2027
V Torres
(4)
FY24 LTI 133 1,153 80 694 303,450 August 2027
N Pillay
(5)
FY24 LTI 133 927 80 557 243,820 August 2027
(1) The grant of awards is based on the face value as outlined in Components of our reward (see page 88).
(2) The target value considers the difficulty of achieving performance hurdles.
(3) The number of awards granted to Executive KMP in December 2023 is calculated by dividing the face value by the VWAP of South32 shares traded on the ASX over the last 10
trading days of June 2023, being A$3.80. The fair value at grant for accounting purposes, as calculated by an external provider, was A$1.54 per right for the FY24 LTI and A$1.21
per right for the FY24 Transitional LTI award.
(4) V Torres become a member of Executive KMP on 14 March 2024, after the FY24 LTI award was granted to her in December 2023.
(5) Fixed remuneration for N Pillay is denominated in ZAR and was converted to A$ using an exchange rate of AUD: ZAR 12.46 to determine his FY24 award.
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SOUTH 32 ANNUAL REPORT 2024
Remuneration report continued
FY24 LTI strategic measures performance update
In FY22 we introduced two strategic measures, with a total weighting of 20 per cent of our LTI grant, to directly link executive
remuneration to our approach to climate change and the transition of our portfolio towards commodities critical for a low-carbon future.
Vesting outcomes for the strategic measures will be determined by the Board following the end of each four-year performance period
(e.g. on 30 June 2027 for the FY24 LTI award), based on our ability to make material progress in these areas, while aiming to protect and
create shareholder value. The Board’s rationale in assessing performance and determining the vesting outcome for each measure will
be clearly articulated and shared with shareholders following the Board’s assessment.
Table 1.12 below summarises the progress made against the strategic measures over the FY22 to FY24 period.
Table 1.12 – Strategic measures update
Measure Progress against Measure
(1)
Climate change
We are taking action to meet our
target to reduce our operational
greenhouse gas (GHG) emissions
(Scope 1 and 2) by 50 per cent by
2035, from an FY21 baseline
(2)
, in
accordance with our 2022 Climate
Change Action Plan, which includes:
– The advancement of conceptual
projects through our capital
investment tollgates, and the
successful commissioning of
identified emissions reduction
projects;
– The ongoing assessment of new
technologies and alternative
energy sources; and
– Continued participation and
direct investment in research and
development partnerships.
Consistent with our purpose, we will
work to provide a just transition
towards net zero in a way that
supports our people, local
communities and other
stakeholders.
Since FY22, we have invested US$67 million in decarbonisation projects and studies. Our focus has
been on improving energy efficiency, transitioning to low-carbon energy, and developing technology
solutions with key milestones that included:
Advancements of conceptual projects
– Progressing the coal to gas project at Worsley Alumina from pre-feasibility study in FY22 to
the conversion of two of the five coal-fired boilers to natural gas. In FY24, this contributed to a
14 per cent reduction in the refinery’s operational GHG emissions against FY21 levels;
– Progressing decarbonisation studies through the various project phases at Worsley Alumina,
including mud-washing through feasibility study
(3)
, waste to heat digestion through pre-feasibility,
and mechanical vapour recompression and calciner flue gas heat recovery through concept studies.
– Progressing AP3XLE energy efficiency technology from feasibility study phase in FY22 to the
conversion of 36 per cent of pots at Hillside Aluminium to AP3XLE technology; and
– Exceeding our 67 per cent target for post drainage capture efficiency (PDCE) of coal seam gas at
Appin mine, Illawarra Metallurgical Coal (61 per cent in FY21).
Assessment of new technologies and alternative energy sources
– Progressing the energy supply project at Hillside Aluminium from a pre-feasibility study in FY22 to
a Request for Information (RFI) from South African Independent Power producers in FY24. This RFI
demonstrated the potential to procure affordable renewable energy, but identified several key risks
and uncertainties;
– Progressing from a pilot plant scale trial of ventilation air-methane mitigation technology at Illawarra
Metallurgical Coal in FY22 through the feasibility project development stages to detailed design for a
commercial-scale project
– Continuing to work closely with the Government of the Republic of Mozambique and Eskom to
secure hydro-electric power for Mozal Aluminium beyond Q3 FY26. In FY24, this contributed to the
formation of a ministerial taskforce to accelerate progress; and
– Incorporating low-carbon design principles into the feasibility study for the Hermosa Taylor
development project.
Participation and investment in research and development partnerships
– Contributing to the Electric Mine Consortium infrastructure workstream by trialling light electric
vehicles in FY23, and in FY24 an electric integrated tool carrier, and equipment chargers at
Cannington.
Just transition
– Completing a study of the potential workforce impacts from our Worsley Alumina decarbonisation
plans to inform our just transition planning.
(1) Further information on the progress of items listed can be found in our Sustainable Development Report 2024 at www.south32.net.
(2) FY21 baseline adjusted to exclude GHG emissions from South Africa Energy Coal and Tasmanian Electro Metallurgical Company, which were divested in FY21.
(3) Project returned to the pre-feasibility study stage due the capital intensity of the expected abatement compared to other potential projects.
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SOUTH 32 ANNUAL REPORT 2024
Measure Progress against Measure
(1)
Portfolio management
We are planning to further reshape
our portfolio and increase our
exposure to commodities critical for
a low-carbon future by:
– Optimising our existing portfolio
by responsibly transferring
ownership of non-core operations
or transitioning them to closure;
– Developing or acquiring
operations which are cash
generative through the cycle,
improving the overall quality of
our business;
– Building a high-quality portfolio
of greenfield and brownfield
exploration and development
options; and
– Maintaining discipline by
adhering to our proven capital
management framework.
We have made significant progress over the last three years in this transformative area, shifting our
portfolio towards commodities critical for a low carbon future. Key milestones have included:
Optimising our portfolio
– Entering into an agreement to sell Illawarra Metallurgical Coal. The sale will unlock significant value,
further streamline our portfolio toward base metals, simplify our business, strengthen our balance
sheet and reduce our sustaining capital intensity; and
– Entering into binding agreements to sell our 50 per cent interest in the Eagle Downs metallurgical
coal project and our 60 per cent interest in the Metalloys manganese alloy smelter.
Developing and acquiring operations
– Expanding our low-carbon aluminium capacity by increasing our interests in Mozal (by 16.6 per cent)
and restarting the 40 per cent owned Brazil Aluminium smelter in FY22 utilising 100 per cent
renewable energy;
– Derisking bauxite supply for Brazil Alumina by increasing our interest in Mineração Rio do Norte
(MRN) by 18.2 per cent and progressing the West Zone project; and
– Entering into the global copper market by acquiring a 45 per cent interest in Sierra Gorda copper
mine.
Exploration and development options
– Exercising our earn-in right with Minsud Resources and acquiring 50.1 per cent and taking control
and operatorship of the Chita Valley copper exploration project in San Juan Province, Argentina; and
– Undertaking exploratory drill programs at Hermosa’s Peake prospect in FY23 and Flux prospect in
FY24 and confirming target prospectivity.
Adhering to our capital management framework
– Prioritising the allocation of excess capital to projects that we expect will create enduring
shareholder value.
Terms and conditions of rights awarded under equity plans
Type of equity We deliver Deferred STI and LTI equity awards, including Transitional LTI and MSP awards, in the form of share
rights. These are rights to receive fully paid ordinary shares in South32 Limited (or at the Board’s discretion, a
cash equivalent amount) subject to meeting specific performance and/or vesting conditions. As the rights are
an element of remuneration, no amount is payable by employees to be allocated the rights. If the rights vest,
no consideration or exercise price is payable for the allocation of shares. As rights are automatically exercised
on vesting, they do not have an expiry date.
Dividend and voting rights Rights carry no entitlement to voting or dividends. Rights to be granted in or around December 2024 for the
FY24 Deferred STI awards will include an entitlement to a cash dividend equivalent payment paid in full at
vesting (but only in respect of those Deferred STI rights that vest). No other rights carry a dividend equivalent
entitlement.
Cessation of employment Unless our Board determines otherwise:
– Resignation or termination for cause: all unvested rights lapse;
– Death, serious injury, disability or illness that prevents continued employment or total permanent disability:
all unvested rights vest immediately; and
– Other circumstances, generally:
• Deferred STI awards: all unvested rights vest immediately;
• LTI and MSP Performance awards: all unvested rights are pro-rated and the reduced portion remains on
foot and eligible for vesting in the ordinary course, subject to any applicable performance hurdles; and
• MSP Retention awards: all unvested rights are pro-rated and the reduced portion vests immediately.
Where awards are pro-rated, the remaining portion lapses.
Change of control Our Board can determine the level of vesting (if any) having regard to the portion of the vesting period
elapsed, performance to date against any applicable performance conditions and other factors they deem
appropriate.
Malus and clawback Our Board can reduce or clawback all vested and unvested STI and LTI awards in certain circumstances so that
executives do not obtain an inappropriate benefit. These circumstances are broad, and can include:
– An executive engaging in misconduct;
– A material misstatement of our accounts that results in vesting;
– Behaviours of executives that bring South32 into disrepute;
– A significant unexpected or unintended consequence or outcome; and
– Any other factor our Board deems justifiable.
Rights to participate
in new issues
A participant cannot take part in new issues of securities in relation to their unvested rights. However, the
relevant plan rules include specific provisions dealing with rights issues, bonus issues and corporate actions,
and other capital reconstructions.
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SOUTH 32 ANNUAL REPORT 2024
Remuneration report continued
Non-Executive Director remuneration
Components of our reward for FY24
Component Board fees Committee fees Travel allowance
The why As a global company, it’s important
that we offer competitive Non-
Executive Director fees to help us
attract the appropriate level of
experience from a diverse global
pool.
Our Board fees reflect the size,
complexity and global nature of our
business and acknowledge the
responsibilities of serving on our
Board.
To preserve the independence of our
Non-Executive Directors, their
remuneration does not have an ‘at
risk’ element.
We pay Committee fees to recognise
the additional responsibilities
associated with participating on a
Board Committee.
Our Board meetings are ordinarily held in
Australia, South Africa and North and South
America (see page 75 for more details).
Site visits are also an important part of our
Board program, giving Directors:
– A better understanding of workplace
culture through interactions with site-
based employees;
– An improved understanding of local and
operational risks;
– A chance to participate in continuous
education; and
– On-the-ground experience.
As these meetings (site visits and other
engagements) take time and commitment,
particularly if they are in remote locations,
we provide our Non-Executive Directors with
a travel allowance.
The how Board fee inclusive of
superannuation.
We pay a fixed fee to our Board Chair
for all responsibilities, including
participation on any Board
Committees.
Other Non-Executive Directors
receive Committee Chair and
member fees (where applicable).
For air travel to a Board commitment that is
greater than three hours but less than 10
hours to the destination, a one-off allowance
of A$5,000 per trip applies. Where air travel
is greater than 10 hours to the destination,
the allowance per trip is A$10,000.
The travel allowance is only paid where
travel is undertaken and does not apply to
domestic travel to a scheduled Board
meeting.
Fee pool The maximum aggregate amount we can pay our Non-Executive Directors remains at A$3.9 million per annum (fee pool). We
will seek shareholder approval before making any changes to this pool.
Minimum
shareholding
requirement
Each Non-Executive Director is required to accumulate a minimum shareholding of one year’s Board fees within a
reasonable period. See page 107 for shareholdings of our Non-Executive Directors.
FY24 Non-Executive Director fees
We review fees every year and may receive external advice to help us do so. We based the review of FY24 fees on data provided by
external consultants. This resulted in no change to the Board fees for the Chair and other Non-Executive Directors fees from FY23.
The table below outlines the fee levels for FY24.
Table 1.13 – FY24 Board and Committee fees, effective 1 September 2023
Fee Description
FY24 fee
(A$ per annum)
Increase %
from FY23 fee
Board fees
Board of Directors
Chair of the Board
Other Non-Executive Directors
595,250
195,000
-
-
Committee fees
(1)
Risk and Audit, Remuneration, and Sustainability Committees
Committee Chair
Members
46,000
23,000
-
-
(1) No Committee Chair or member fees were paid in FY24 for participation on the Nomination and Governance Committee.
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SOUTH 32 ANNUAL REPORT 2024
FY24 Non-Executive Director remuneration
In Table 1.14, we have set out the statutory disclosures required under the Act and in accordance with Australian Accounting Standards,
in respect of FY24 remuneration paid to Non-Executive Directors.
Table 1.14 – Non-Executive Director remuneration (A$’000)
Short-term benefits
Post-
employment
benefits
Non-Executive Director FY24 term
Board and
Committee
fees
Non-monetary
benefits
(1)
Other cash
allowances and
benefits
(2)
Superannuation Total
K Wood Full year
FY24 568 - 15 27 610
FY23 567 - 20 25 612
F Cooper AO Full year
FY24 237 - 15 27 279
FY23 238 - 10 25 273
X Liu Full year
FY24 219 - 15 27 261
FY23 215 - 30 25 270
C Mesquita Full year
FY24 215 4 60 3 282
FY23 33 - 10 - 43
N Mtoba Full year
FY24 215 3 40 3 261
FY23 214 4 40 3 261
J Nelson Full year
FY24 215 2 60 3 280
FY23 33 - 5 - 38
W Osborn Full year
FY24 254 - 20 27 301
FY23 238 - 35 25 298
K Rumble Full year
FY24 255 3 50 3 311
FY23 260 2 45 3 310
S Warburton
(3)
Part year
FY24 105 - 15 16 136
FY23 - - - - -
Total
FY24 2,283 12 290 136 2,721
FY23 1,798 6 195 106 2,105
(1) Includes assistance with tax return preparation.
(2) Includes travel allowances paid.
(3) Appointed on 28 November 2023.
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Remuneration report continued
Looking forward to FY25
No major changes are proposed to the reward framework for FY25. The Board routinely reviews the reward framework to assess its
effectiveness in attracting and retaining Executive KMP whilst also incorporating the necessary flexibility to reward our Executive KMP
for performance that is aligned with the interests of stakeholders.
Fixed remuneration
The Board approved increases to the fixed remuneration of Executive KMP for FY25 to maintain fixed remuneration at competitive levels
in alignment with our reward framework (see Table 1.15).
Table 1.15 – Fixed remuneration for Executive KMP in FY25, effective 1 September 2024
Executive KMP
FY24 fixed remuneration
(A$)
FY25 fixed remuneration
(A$)
Increase
%
G Kerr 1,991,000 2,070,000 4.0%
S Sibenaler 867,000 910,000 5.0%
V Torres 867,000 902,000 4.0%
N Pillay
(1)
ZAR 8,680,000 ZAR 9,201,000 6.0%
(1) Fixed remuneration for N Pillay is denominated in ZAR. Using an exchange rate of AUD:ZAR 12.27, FY25 fixed remuneration is A$749,878.
Short-term incentive
The structure of our STI plan will remain unchanged for FY25 and is outlined in Diagram 1.13.
Diagram 1.13 – FY25 STI Business Scorecard performance metrics
Measures Performance metrics FY25 weighting
Safety and culture
Safety and health, risk management, people
25.0%
Environment and social
Social performance, water performance
10.0%
Financial
Production, cost, capital expenditure, adjusted ROIC
57.5%
Major projects delivery
Hermosa project milestones
7.5%
Business Scorecard 100%
X
Business Modifier Consider factors that are not specifically contemplated in the Business Scorecard +/-
=
South32 Business Outcome Reflects our performance over the financial year
Long-term incentive
The LTI plan design will remain unchanged for FY25. We will continue to measure our performance over a four-year period with
80 per cent assessed based on TSR performance relative to two comparator groups and 20 per cent assessed against two strategic
measures, climate change and portfolio management, each with a 10 per cent weighting.
Director Fees
Effective 1 September 2024, Board fees for the Chair will increase by 2.5 per cent and by four per cent for other Non-Executive Directors
as outlined in Table 1.16 below. There will be no change to Committee fees or the travel allowance. Total fees paid to Non-Executive
Directors in FY25 will not exceed the fee pool (A$3.9M).
Table 1.16 – FY25 Board and Committee fees – effective 1 September 2024
Fee Description
FY24 fee
(A$ per
annum)
FY25 fee
(A$ per
annum)
Increase %
from
FY24 fee
Board fees
Board of Directors
Chair of the Board 595,250 610,000 2.5%
Other Non-Executive Directors 195,000 202,750 4.0%
Committee fees
(1)
Risk and Audit, Remuneration, and Sustainability Committees
Committee Chair 46,000 46,000 -
Members 23,000 23,000 -
(1) No Committee Chair or member fees are typically paid for participation on the Nomination and Governance Committee.
104
SOUTH 32 ANNUAL REPORT 2024
Statutory disclosures
Statutory remuneration table for Executive KMP
In the following table, we have set out the statutory disclosures required under the Act and in accordance with the Australian
Accounting Standards. The amounts shown reflect the remuneration for each member of Executive KMP that relates to their service as
KMP in FY24.
Table 1.17 – Statutory remuneration of Executive KMP in FY24 (A$’000)
Short term benefits
Post
employment
benefits
Share based payments
(4)
Percentage of
total
remuneration
which is
performance
testedExecutive KMP Salary
Cash
bonus
(1)
Non-
monetary
benefits
(2)
Superannuation
Termination
benefits
Other
long-term
benefits
(3)
LTI / MSP STI
Total
remuneration
G Kerr
FY24 1,813 1,306 56 29 - 184 2,674 1,025 7,087 71%
FY23 1,651 719 48 28 - 176 2,605 833 6,060 69%
S Sibenaler
(5)
FY24 817 640 8 29 - 78 334 235 2,141 56%
FY23 195 84 1 6 - 19 49 9 363 39%
J Economidis
(6)
FY24 536 578 11 20 - 55 550 178 1,928 68%
FY23 716 352 12 26 - 74 748 271 2,199 62%
V Torres
(7)
FY24 249 141 9 9 - 23 217 123 771 62%
FY23 - - - - - - - - - -
N Pillay
(8)
FY24 630 445 27 - - 82 607 290 2,081 64%
FY23 631 248 26 - - 79 593 151 1,728 57%
Total
FY24 4,045 3,110 111 87 - 422 4,382 1,851 14,008
FY23 3,193 1,403 87 60 - 348 3,995 1,264 10,350
(1) STI is provided half in cash (which is included in the cash bonus column of the table) in September following the end of the performance period and half in deferred rights
(which is included in the share-based payments column of the table). The value of the deferred equity portion is amortised over the vesting period.
(2) Non-monetary benefits are non-pensionable and include such items as insurances, car parking and personal tax assistance.
(3) Other long-term benefits is the accounting expense of annual and long-service leave accrued.
(4) The related awards were not actually provided to the Executive KMP. The figures are calculated in accordance with Australian Accounting Standards and are the amortised fair
values of equity and equity-related instruments that have been granted to Executive KMP. Refer to Table 1.18 on page 106 in this report for information on awards outstanding
during FY24.
(5) FY23 remuneration for S Sibenaler is for the period from when she commenced as a member of Executive KMP (1 April 2023).
(6) FY24 remuneration for J Economidis is for the period until he ceased to be a member of Executive KMP (13 March 2024). From 14 March 2024, J Economidis transitioned into the
role of Director Illawarra Metallurgical Coal. J Economidis’ employment contract in respect of his role as Director Illawarra Metallurgical Coal provides for accelerated vesting of
Deferred STI rights and for a pro rated portion of his LTI rights to remain on foot and eligible for vesting in the ordinary course should his employment with South32 cease as a
result of the sale of Illawarra Metallurgical Coal completing. No amounts have been included as remuneration in the table above in respect of his service as Director Illawarra
Metallurgical Coal, nor has any value been attributed to the acceleration of his unvested Deferred STI awards upon cessation of his employment with South32.
(7) FY24 remuneration for V Torres is for the period from when she commenced as a member of Executive KMP (14 March 2024).
(8) FY24 salary for N Pillay is denominated in ZAR and has been converted to A$ using an exchange rate of AUD: ZAR 12.27. FY23 salary for N Pillay was converted to A$ using an
exchange rate of AUD: ZAR 11.96.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
105
SOUTH 32 ANNUAL REPORT 2024
Remuneration report continued
Details of rights held by Executive KMP
In the following table, we have set out more information about the rights over South32 shares held by Executive KMP, including the
movements in rights held during FY24. No closely related parties of any Executive KMP are issued rights over South32 shares.
See page 101 for terms and conditions of rights awarded under our equity plans.
Table 1.18 – Detail and movement of rights over South32 shares held by Executive KMP during FY24
Award
(1)(2)
Opening
balance at
1 July 2023 Grant date
Granted
in FY24
(3)
Vested in FY24
Lapsed / forfeited or
other change in FY24
Closing
balance at
30 June
2024
(6)
Anticipated
vesting
date
(4)
Executive KMP Number Number Number
(4)
%
(5)
Number %
(5)
Number
G Kerr 7,118 ,5 82 1,281,440 242,160 12 1,696,261 88 6,461,601
FY23 Deferred STI (S) - 04-Dec-23 233,546 - - - - 233,546 Aug-25
FY24 LTI (P) - 04-Dec-23 1,0 47,89 4 - - - - 1,0 47,894 Aug-27
FY22 Deferred STI (S) 283,289 08-Dec-22 - - - - - 283,289 Aug-24
FY23 LTI (P) 934,313 08-Dec-22 - - - - - 934,313 Aug-26
FY21 Deferred STI (S) 242,160 06-Dec-21 - 242,160 100 - - - Aug-23
FY22 LTI (P) 1,267,01 5 06-Dec-21 - - - - - 1, 267,015 Aug-25
FY21 LTI (P) 2,695,544 04-Dec-20 - - - - - 2,695,544 Aug-24
FY20 LTI (P) 1,696,261 06 -Dec-19 - - - 1,696,261 100 - Aug-23
S Sibenaler 284,124 416,299 23,762 100 - - 676,661
FY23 Deferred STI (S) - 04-Dec-23 27, 290 - - - - 27,29 0 Aug-25
FY24 LTI (P) - 04-Dec-23 303,450 - - - - 303,450 Aug-27
FY24 Transitional LTI (P) - 04-Dec-23 85,559 - - - - 85,559 Aug-26
FY23 MSP Retention (S) 32,113 08-Dec-22 - - - - - 32,113 Aug-25
FY23 MSP Performance (P) 53,522 08-Dec-22 - - - - - 53,522 Aug-26
FY22 MSP Retention (S) 43,246 06-Dec-21 - - - - - 43,246 Aug-24
FY22 MSP Performance (P) 72,076 06-Dec-21 - - - - - 72,076 Aug-25
FY21 MSP Retention (S) 23,762 06-May-21 - 23,762 100 - - - Aug-23
FY21 MSP Performance (P) 59,405 06-May-21 - - - - - 59,405 Aug-24
J Economidis
(6)
1,631,118 413,834 136,637 47 155,763 53 1,752,552
FY23 Deferred STI (S) - 04-Dec-23 114,234 - - - - 114,234 Aug-25
FY24 LTI (P) - 04-Dec-23 299,600 - - - - 299,600 Aug-27
FY22 Deferred STI (S) 112,504 08-Dec-22 - - - - - 112,504 Aug-24
FY23 LTI (P) 266,977 08-Dec-22 - - - - - 266,977 Aug-26
FY21 Deferred STI (S) 37,628 06-Dec-21 - 37, 628 100 - - - Aug-23
FY22 LTI (P) 362,094 06-Dec-21 - - - - - 362,094 Aug-25
FY22 Transitional LTI (P) 102,094 06-Dec-21 - - - - - 102,094 Aug-24
FY21 MSP Retention (S) 99,009 04-Dec-20 - 99,009 100 - - - Aug-23
FY21 MSP Performance (P) 495,049 04-Dec-20 - - - - - 495,049 Aug-24
FY20 MSP Performance (P) 155,763 06-Dec-19 - - - 155,763 100 - Aug-23
V Torres
(7)
1,847,582 - - - - - 1 ,847,582
FY23 Deferred STI (S) 134,201 04-Dec-23 - - - - - 134,201 Aug-25
FY24 LTI (P) 303,450 04-Dec-23 - - - - - 303,450 Aug-27
FY22 Deferred STI (S) 106,735 08-Dec-22 - - - - - 106,735 Aug-24
FY23 LTI (P) 270,563 08-Dec-22 - - - - - 270,563 Aug-26
FY22 LTI (P) 343,525 06-Dec-21 - - - - - 343,525 Aug-25
FY21 LTI (P) 689,108 04-Dec-20 - - - - - 689,108 Aug-24
N Pillay
1,162,203 321,530 86,262 39 135,708 61 1,261,763
FY23 Deferred STI (S) - 04-Dec-23 7 7,710 - - - - 7 7,710 Aug-25
FY24 LTI (P) - 04-Dec-23 243,820 - - - - 243,820 Aug-27
FY22 Deferred STI (S) 61,336 08-Dec-22 - - - - - 61,336 Aug-24
FY23 LTI (P) 240,246 08-Dec-22 - - - - - 240,246 Aug-26
FY22 LTI (P) 329,962 06-Dec-21 - - - - - 329,962 Aug-25
FY22 Transitional LTI (P) 93,034 06-Dec-21 - - - - - 93,034 Aug-24
FY21 MSP Retention (S) 86,262 04-Dec-20 - 86,262 100 - - - Aug-23
FY21 MSP Performance (P) 215,655 04-Dec-20 - - - - - 215,655 Aug-24
FY20 MSP Performance (P) 135,708 06-Dec-19 - - - 135,708 100 - Aug-23
(1) At the time of vesting, the quantum of all awards that vest based on performance and/or service conditions will automatically convert to South32 ordinary shares, in the
participant’s name, for nil consideration (unless the Board exercises its discretion to settle awards in cash instead of allocating shares). Any rights that do not vest will
immediately lapse, hence there is no expiry date associated with the awards. (S) - Service only or (P) - Performance and Service conditions apply. As rights are subject to
service and/or performance conditions, the minimum possible total value of rights granted under South32 equity plans for future financial years is nil and the maximum
possible total value is the number of rights multiplied by the market price of South32 shares on the date of vesting.
(2) Further details regarding each of the prior year equity grants are described in past South32 Annual Reports.
(3) The fair value for awards granted in FY24 is the grant date fair value for accounting purposes being A$2.88 for the FY23 Deferred STI award, A$1.54 for the FY24 LTI award and
A$1.21 for the FY24 Transitional LTI award. Shareholders approved, under ASX Listing Rule 10.14, the grant of rights for the CEO at the AGM on 26 October 2023.
(4) Rights that vested in FY24 converted to South32 ordinary shares for nil consideration on 25 August 2023. The South32 closing share price on this date was A$3.48. The vesting
outcome for FY21 LTI awards, FY22 Transitional LTI awards, FY21 MSP Performance awards and FY22 MSP Retention awards scheduled to vest in August 2024 is summarised
on page 99.
(5) The percentage is based on the maximum number of rights available to vest in FY24.
(6) J Economidis ceased to be COO Australia and a member of the Executive KMP on 13 March 2024. Closing balance is at this date.
(7) V Torres became COO Australia and a member of the Executive KMP on 14 March 2024. Opening balance is at this date.
106
SOUTH 32 ANNUAL REPORT 2024
Details of MSP and Transitional LTI awards
Key terms and performance conditions of MSP and Transitional LTI awards are outlined below in Table 1.19. For additional terms of the
rights granted under the two plans, see Terms and conditions of rights awarded under equity plans on page 101.
Table 1.19 – Key terms and performance conditions of awards
(1)
Award Key Terms and Performance Conditions
MSP The MSP is our LTI plan for eligible employees below Lead Team level. The Plan has two elements:
– Retention rights with a three-year vesting and service period from 1 July to 30 June, vesting in August three years from
grant provided employees remain employed in the Group
(2)
; and
– Performance rights with a four-year performance and service period from 1 July to 30 June, vesting in August four years
from grant, subject to the same performance and vesting conditions as the LTI for Executive KMP for that year (see
page 88). There is no retesting if the performance condition is not met and any rights that don’t vest will immediately
lapse.
Rights do not carry any entitlement to voting, dividends or dividend equivalent payments.
Transitional
LTI plan
When an executive is promoted to a role in the Lead Team, they move from the MSP (three-year retention rights and
four-year performance rights) to the LTI plan for the Lead Team (four-year performance rights). The Transitional LTI is a
one-off award that may be granted to address the potential shortfall in vesting after three years.
These awards have the same TSR performance conditions as LTI awards granted in the same year except these awards
have a three-year performance period.
Details of Transitional LTI awards held at 30 June 2024 are outlined in Table 1.18. Further details about Transitional LTI
awards granted in earlier years are described in past South32 Annual Reports.
(1) See page 88 for key terms of the LTI.
(2) The retention rights are subject to a service condition. Performance hurdles are factored into the performance rights component of MSP awards.
Shareholdings of KMP
The minimum shareholding requirement for Executive KMP is summarised on page 89.
For Non-Executive Directors, the valuation approach used to determine the minimum shareholding requirement of one year’s Board
fees is the cost to the Non-Executive Director to acquire the shares, except for shares acquired at demerger which are valued based on
the closing South32 Limited share price on 18 May 2015 (A$2.05). As at 30 June 2024, Dr Ntombifuthi (Futhi) Mtoba, Ms Jane Nelson and
Ms Sharon Warburton did not meet this requirement. The percentage of fees reflected in the Table 1.20 below is based on our share
price at 30 June 2024.
Table 1.20 – South32 shares held directly, indirectly or beneficially by each member of KMP, including their related parties
Held at
1 July 2023
Received on
vesting of rights
Received as
remuneration
Other net
change
(1)
Held at
30 June 2024
% of Board Fees/
fixed
remuneration
(2)
Non-Executive Directors
K Wood 367,825 - - - 3 67,825 226
F Cooper AO 128,010 - - - 128,010 240
X Liu 66,000 - - - 66,000 124
C Mesquita 17 7,440 - - - 177,440 333
N Mtoba 71,386 - - - 71,386 134
J Nelson - - - - - -
W Osborn 174,104 - - - 174,104 327
K Rumble 161,380 - - - 161,380 303
S Warburton
(3)
42,870 - - - 42,870 80
Executive KMP
G Kerr 1,976,772 242,160 - (17 7,98 8) 2,040,944 375
S Sibenaler - 23,762 - - 23,762 10
J Economidis
(4)
111,764 136,637 - (64,220) 184,181 79
V Torres
(5)
462,313 - - - 462,313 195
N Pillay 322,038 86,262 - (38,819) 369,481 191
(1) Other net change includes purchases, and sales and transfers of vested shares.
(2) Based on Board fees and fixed remuneration at 30 June 2024 and the closing share price of South32 shares as at that date of A$3.66.
(3) S Warburton was appointed as a Non-Executive Director on 28 November 2023. Opening balance is as at this date.
(4) J Economidis ceased to be COO Australia and a member of Executive KMP on 13 March 2024. Closing balance is at this date.
(5) V Torres became COO Australia and a member of Executive KMP on 14 March 2024. Opening balance is at this date.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
107
SOUTH 32 ANNUAL REPORT 2024
Remuneration report continued
Additional information
Transactions with KMP
There are no amounts payable to any KMP at 30 June 2024.
During FY24, there were no transactions between KMP or their close family members and the Group other than as described in this
report.
There are no loans with any KMP.
A number of Directors of the Group have control or joint control of other entities (also known as personal entities). During the year, there
have been no transactions between those entities and the Group, and no amounts were owed by or to the Group from those entities.
This Remuneration report was approved by our Board on 29 August 2024.
108
SOUTH 32 ANNUAL REPORT 2024
FINANCIAL REPORT
Consolidated income statement 110
Consolidated statement of comprehensive income 111
Consolidated balance sheet 112
Consolidated cash flow statement 113
Consolidated statement of changes in equity 114
Notes to financial statements – Basis of preparation 115
1. Reporting entity 115
2. Basis of preparation 115
3. New standards and interpretations 117
Notes to financial statements – Results for the year 118
4. Segment information 118
5. Expenses excluding finance costs 128
6. Tax 129
7. Dividends 132
8. Earnings per share 132
Notes to financial statements – Operating assets and liabilities 133
9. Trade and other receivables 133
10. Inventories 133
11. Property, plant and equipment 134
12. Intangible assets 137
13. Impairment of non-financial assets 138
14. Trade and other payables 144
15. Provisions 144
Notes to financial statements – Capital structure and financing 147
16. Cash and cash equivalents 147
17. Interest bearing liabilities 147
18. Net finance income/(costs) 148
19. Financial assets and financial liabilities 149
20. Share capital 154
Notes to financial statements – Other notes 155
21. Auditor’s remuneration 155
22. Employee share ownership plans 155
23. Contingent assets and liabilities 158
24. Subsidiaries 159
25. Equity accounted investments 160
26. Interests in joint operations 162
27. Key management personnel 162
28. Related party transactions 163
29. Parent entity information 164
30. Assets and liabilities held for sale and discontinued operations 165
31. Subsequent events 167
Consolidated entity disclosure statement 168
Directors’ declaration 170
Lead auditor’s independence declaration 171
Independent auditor’s report 172
109
SOUTH 32 ANNUAL REPORT 2024
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
109
SOUTH32 ANNUAL REPORT 2024
| FY23 | |||
US$M | Note | FY24 | Restated (1) |
| Continuing operations | |||
| Revenue: | |||
Group production | |||
Third party products and services | |||
4 | |||
Other income | |||
Expenses excluding finance costs | 5 | ( | ( |
Share of profit/(loss) of equity accounted investments | 25 | ( | |
Profit/(loss) from continuing operations | ( | ( | |
| Comprising: | |||
Group production | ( | ( | |
Third party products and services | |||
Profit/(loss) from continuing operations | ( | ( | |
Finance income | |||
Finance costs | ( | ( | |
Net finance income/(costs) | 18 | ( | |
Profit/(loss) before tax from continuing operations | ( | ( | |
Income tax (expense)/benefit | 6 | ( | |
Profit/(loss) for the year from continuing operations | ( | ( | |
| Discontinued operation | |||
Profit/(loss) after tax from a discontinued operation | 30 | ||
Profit/(loss) for the year | ( | ( | |
| Attributable to: | |||
Equity holders of South32 Limited | ( | ( | |
Non-controlling interests | ( | ||
Profit/(loss) for the year from continuing operations attributable to equity holders of South32 Limited: | |||
Basic earnings/(loss) per share (cents) | 8 | ( | ( |
Diluted earnings/(loss) per share (cents) | 8 | ( | ( |
| Profit/(loss) for the year attributable to equity holders of South32 Limited: | |||
Basic earnings/(loss) per share (cents) | 8 | ( | ( |
Diluted earnings/(loss) per share (cents) | 8 | ( | ( |
(1) Refer to note 30Assets and liabilities held for sale and discontinued operations.
The accompanying notes form part of the consolidated financial statements.
Consolidated income statement
for the year ended 30 June 2024
110
SOUTH 32 ANNUAL REPORT 2024
US$M | Note | FY24 | FY23 |
Profit/(loss) for the year | ( | ( | |
| Other comprehensive income | |||
| Items that may be reclassified to the Consolidated income statement: | |||
Translation of foreign operations | |||
Share of other comprehensive income/(loss) of equity accounted investments | 25 | ||
Total items that may be reclassified to the Consolidated income statement | |||
| Items that will not be reclassified to the Consolidated income statement: | |||
| Investments in equity instruments designated as fair value through other comprehensive income | |||
| (FVOCI): | |||
Net fair value gains/(losses) | ( | ( | |
Income tax (expense)/benefit | ( | ||
Gains/(losses) on pension and medical schemes | 15 | ||
Income tax (expense)/benefit recognised within other comprehensive income | ( | ( | |
Total items that will not be reclassified to the Consolidated income statement | ( | ( | |
Total other comprehensive income/(loss) | ( | ||
Total comprehensive income/(loss) | ( | ( | |
| Attributable to: | |||
Equity holders of South32 Limited | ( | ( | |
Non-controlling interests |
The accompanying notes form part of the consolidated financial statements.
Consolidated statement of comprehensive income
for the year ended 30 June 2024
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
111
SOUTH 32 ANNUAL REPORT 2024
US$M Note | FY24 | FY23 | |
| ASSETS | |||
| Current assets | |||
Cash and cash equivalents | 16 | ||
Trade and other receivables | 9 | ||
Other financial assets | 19 | ||
Inventories | 10 | ||
Current tax assets | |||
Other assets | |||
Assets held for sale | 30 | ||
Total current assets | |||
| Non-current assets | |||
Trade and other receivables | 9 | ||
Other financial assets | 19 | ||
Inventories | 10 | ||
Property, plant and equipment | 11 | ||
Intangible assets | 12 | ||
Equity accounted investments | 25 | ||
Deferred tax assets | 6 | ||
Other assets | |||
Total non-current assets | |||
Total assets | |||
| LIABILITIES | |||
| Current liabilities | |||
Trade and other payables | 14 | ||
Interest bearing liabilities | 17 | ||
Current tax payables | |||
Provisions | 15 | ||
Deferred income | |||
Liabilities directly associated with assets held for sale | 30 | ||
Total current liabilities | |||
| Non-current liabilities | |||
Trade and other payables | 14 | ||
Interest bearing liabilities | 17 | ||
Other financial liabilities | 19 | ||
Deferred tax liabilities | 6 | ||
Provisions | 15 | ||
Deferred income | |||
Total non-current liabilities | |||
Total liabilities | |||
Net assets | |||
| EQUITY | |||
Share capital | 20 | ||
Treasury shares | 20 | ( | ( |
Reserves | ( | ( | |
Accumulated losses | ( | ( | |
Total equity attributable to equity holders of South32 Limited | |||
Non-controlling interests | ( | ||
Total equity |
The accompanying notes form part of the consolidated financial statements.
Consolidated balance sheet
as at 30 June 2024
112
SOUTH 32 ANNUAL REPORT 2024
| FY23 | |||
US$M | Note | FY24 | Restated (1) |
| Operating activities | |||
Profit/(loss) before tax from continuing operations | ( | ( | |
Profit/(loss) before tax from a discontinued operation | 30 | ||
| Adjustments for: | |||
Significant items | ( | ||
Depreciation and amortisation expense | |||
Net impairment loss/(reversal) of financial assets | |||
Net impairment loss/(reversal) of non-financial assets | |||
Employee share awards expense | |||
Net finance (income)/costs | ( | ||
Share of (profit)/loss of equity accounted investments | ( | ||
| (Gains)/losses on derivative instruments, contingent consideration and other investments | |||
measured at fair value through profit or loss (FVTPL) | ( | ( | |
Other non-cash or non-operating items | ( | ||
| Changes in assets and liabilities: | |||
Trade and other receivables | ( | ||
Inventories | ( | ||
Trade and other payables | ( | ( | |
Provisions and other liabilities | |||
Cash generated from operations | |||
Interest received | |||
Interest paid | ( | ( | |
Income tax paid | ( | ( | |
Dividends received | |||
Dividends received from equity accounted investments | |||
Net cash flows from operating activities | |||
| Investing activities | |||
Purchase of property, plant and equipment | ( | ( | |
Exploration expenditure | ( | ( | |
Exploration expenditure expensed and included in operating cash flows | |||
Purchase of intangible assets | ( | ( | |
Proceeds from sale of intangible assets | |||
Investment in financial assets | ( | ( | |
Proceeds from financial assets | |||
Payments for the acquisition of subsidiaries and joint operations, net of their cash | ( | ( | |
Proceeds from the disposal of subsidiaries and joint operations, net of their cash | 30 | ||
Investments in equity accounted investments | ( | ||
Net cash flows from investing activities | ( | ( | |
| Financing activities | |||
Proceeds from interest bearing liabilities | |||
Repayment of interest bearing liabilities | ( | ( | |
Purchase of shares by Employee Share Ownership Plan (ESOP) Trusts | ( | ( | |
Share buy-back | ( | ( | |
Dividends paid | 7 | ( | ( |
Contributions from non-controlling interests | |||
Net cash flows from financing activities | ( | ( | |
Net decrease in cash and cash equivalents | ( | ( | |
Cash and cash equivalents, net of overdrafts, at the beginning of the year | |||
Effect of foreign exchange rate changes on cash and cash equivalents | ( | ||
Cash and cash equivalents, net of overdrafts, at the end of the year | 16 |
(1) Refer to note 30Assets and liabilities held for sale and discontinued operations.
The accompanying notes form part of the consolidated financial statements.
Consolidated cash flow statement
for the year ended 30 June 2024
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
113
SOUTH 32 ANNUAL REPORT 2024
Attributable to equity holders of South32 Limited
| Financial | Employee | Non- | |||||||
| Share | Treasury | assets | share awards | Other | Accumulated | controlling | Total | ||
| US$M | capital | shares | reserve (1) | reserve (2) | reserves (3) | losses | Total | interests (4) | equity |
Balance as at1July 2023 | ( | ( | ( | ( | ( | ||||
Profit/(loss) for the year | ( | ( | ( | ( | |||||
Other comprehensive income/(loss) | ( | ( | ( | ||||||
Total comprehensive income/(loss) | ( | ( | ( | ( | |||||
| Transactions with owners: | |||||||||
Dividends | ( | ( | ( | ||||||
Shares bought back and cancelled | ( | ( | ( | ||||||
Employee share entitlements for unvested awards, net of tax | |||||||||
Employee share awards vested and lapsed, net of tax | ( | ( | ( | ( | |||||
Purchase of shares by ESOP Trusts | ( | ( | ( | ||||||
Equity issued to holders of non- controlling interest | |||||||||
Acquisition of subsidiary with non- controlling interest | |||||||||
Balance as at30June 2024 | ( | ( | ( | ( | |||||
Balance as at1July 2022 | ( | ( | ( | ( | |||||
Profit/(loss) for the year | ( | ( | ( | ||||||
Other comprehensive income/(loss) | ( | ||||||||
Total comprehensive income/(loss) | ( | ( | ( | ( | |||||
| Transactions with owners: | |||||||||
Dividends | ( | ( | ( | ||||||
Shares bought back and cancelled | ( | ( | ( | ||||||
Employee share entitlements for unvested awards, net of tax | |||||||||
Employee share awards vested and lapsed, net of tax | ( | ( | ( | ||||||
Purchase of shares by ESOP Trusts | ( | ( | ( | ||||||
Balance as at30June 2023 | ( | ( | ( | ( | ( |
(1) Represents the fair value movement in financial assets 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 demerger of the Group in 2015.
(4) Primarily relates to the minority shareholder (49.9 per cent) of Minera Sud Argentina S.A. (MSA), which holds the Chita Valley copper porphyry exploration project in Argentina.
The Group acquired a 50.1 per cent interest in MSA in April 2024.
The accompanying notes form part of the consolidated financial statements.
Consolidated statement of changes in equity
for the year ended 30 June 2024
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| Key estimates, assumptions and judgements | |
Recognition of deferred taxes | note 6 |
Uncertain tax matters | note 6 |
Useful economic lives of assets | note 11 |
Impairment of non-financial assets | note 13 |
Closure and rehabilitation provisions | note 15 |
Expected credit loss on credit-impaired financial assets | note 19 |
Notes to financial statements – Basis of preparation
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
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2. Basis of preparation continued
(c)
Key estimates, assumptions and judgements continued
Notes to financial statements – Basis of preparation continued
116
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2. Basis of preparation continued
(c)
Key estimates, assumptions and judgements continued
3. New standards and interpretations
(a) New accounting standards and interpretations effective from 1 July 2023
The following new accounting standards and interpretations have been published and are effective for the year ended 30 June 2024:
– Amendments to AASB 7, AASB 101, AASB 108 and AASB 134 – Disclosure of Accounting Policies and Definition of Accounting
Estimates; and
– Amendments to AASB 1 and AASB 112 – Deferred Tax related to Assets and Liabilities arising from a Single Transaction.
The Group has reviewed these amendments and concluded that none have a material impact on the Group.
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Notes to financial statements – Results for the year
This section focuses on the financial performance of the Group, covering both profitability and the resulting return to shareholders via
earnings per share.
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 | 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 |
Cerro Matoso | Integrated laterite ferronickel mine and smelting complex in Colombia |
Illawarra Metallurgical Coal (1) | Metallurgical coal mines in Australia |
Australia Manganese | Manganese ore mine in Australia |
South Africa Manganese | Manganese ore mines in South Africa |
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4. Segment information continued
(b) Segment results continued
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
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Notes to financial statements – Results for the year continued
4. Segment information continued
(b) Segment results
continued
| FY24 | Worsley | Brazil | Hillside | Mozal | |
| US$M | Alumina | Brazil Alumina | Aluminium | Aluminium | Aluminium |
Revenue from customers | 1,355 | 483 | 242 | 1,717 | 812 |
Other revenue (3) | 1 | 1 | – | 3 | – |
Total underlying revenue | 1,356 | 484 | 242 | 1,720 | 812 |
| Comprising: | |||||
Group production | 717 | 343 | 242 | 1,720 | 812 |
Third party products and services (4) | – | – | – | – | – |
Inter-segment revenue | 639 | 141 | – | – | – |
Total underlying revenue | 1,356 | 484 | 242 | 1,720 | 812 |
Underlying EBITDA | 324 | 40 | (115) | 197 | 39 |
Underlying depreciation and amortisation | (193) | (51) | (6) | (67) | (69) |
Underlying EBIT | 131 | (11) | (121) | 130 | (30) |
| Comprising: | |||||
Group production | 131 | 19 | (121) | 130 | (30) |
Exploration expensed | – | – | – | – | – |
Third party products and services (4) | – | – | – | – | – |
Share of profit/(loss) of equity accounted investments | – | (30) | – | – | – |
Underlying EBIT | 131 | (11) | (121) | 130 | (30) |
| Underlying net finance costs | |||||
| Underlying income tax (expense)/benefit | |||||
| Underlying royalty related tax (expense)/benefit | |||||
| Underlying earnings | |||||
Total adjustments to profit/(loss) (5) | |||||
| Profit/(loss) for the year | |||||
Underlying exploration expenditure | – | – | – | – | – |
Underlying capital expenditure (6) | 106 | 80 | 8 | 40 | 23 |
Underlying equity accounted investments | – | 20 | – | – | – |
Total underlying assets (7) | 3,009 | 898 | 119 | 1,100 | 663 |
Total underlying liabilities (7) | 1,196 | 162 | 51 | 295 | 165 |
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| Discontinued | |||||||||
| Continuing operations | operation | ||||||||
| Group | |||||||||
| Group and | underlying | ||||||||
| unallocated | results from | Illawarra | Group | ||||||
| Australia | South Africa | items/ | continuing | Metallurgical | underlying | ||||
Sierra Gorda (1) | Cannington | Hermosa | Cerro Matoso | Manganese (1) | Manganese (1) | eliminations | operations (1) | Coal (2) | results (1) |
632 | 611 | – | 562 | 447 | 337 | (391) | 6,807 | 1,469 | 8,276 |
15 | 20 | – | (6) | (11) | 6 | (1) | 28 | (8) | 20 |
647 | 631 | – | 556 | 436 | 343 | (392) | 6,835 | 1,461 | 8,296 |
647 | 631 | – | 556 | 436 | 343 | – | 6,447 | 1,224 | 7,671 |
– | – | – | – | – | – | 388 | 388 | 237 | 625 |
– | – | – | – | – | – | (780) | – | – | – |
647 | 631 | – | 556 | 436 | 343 | (392) | 6,835 | 1,461 | 8,296 |
275 | 289 | (24) | 96 | 182 | 65 | (88) | 1,280 | 522 | 1,802 |
(132) | (83) | (4) | (61) | (121) | (20) | (28) | (835) | (81) | (916) |
143 | 206 | (28) | 35 | 61 | 45 | (116) | 445 | 441 | 886 |
143 | 212 | (28) | 38 | 61 | 45 | (96) | 504 | 419 | 923 |
– | (6) | – | (3) | – | – | (27) | (36) | (5) | (41) |
– | – | – | – | – | – | 7 | 7 | 28 | 35 |
– | – | – | – | – | – | – | (30) | (1) | (31) |
143 | 206 | (28) | 35 | 61 | 45 | (116) | 445 | 441 | 886 |
(239) | (10) | (249) | |||||||
(92) | (131) | (223) | |||||||
(36) | – | (36) | |||||||
78 | 300 | 378 | |||||||
(718) | 135 | (583) | |||||||
(640) | 435 | (205) | |||||||
13 | 9 | 24 | 3 | 1 | – | 29 | 79 | 10 | 89 |
207 | 38 | 372 | 34 | 65 | 43 | 1 | 1,017 | 340 | 1,357 |
– | – | – | – | – | – | – | 20 | 6 | 26 |
1,878 | 569 | 1,571 | 334 | 596 | 390 | 2,325 | 13,452 | 1,794 | 15,246 |
214 | 419 | 136 | 243 | 430 | 190 | 2,216 | 5,717 | 558 | 6,275 |
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Notes to financial statements – Results for the year continued
4. Segment information
continued
(b) Segment results continued
FY23 Restated (1) | Worsley | Brazil | Hillside | Mozal | |
| US$M | Alumina | Brazil Alumina | Aluminium | Aluminium | Aluminium |
Revenue from customers | 1,364 | 456 | 166 | 1,822 | 888 |
Other revenue (3) | (1) | – | – | 1 | (2) |
Total underlying revenue | 1,363 | 456 | 166 | 1,823 | 886 |
| Comprising: | |||||
Group production | 642 | 395 | 166 | 1,823 | 886 |
Third party products and services (4) | – | – | – | – | – |
Inter-segment revenue | 721 | 61 | – | – | – |
Total underlying revenue | 1,363 | 456 | 166 | 1,823 | 886 |
Underlying EBITDA | 251 | 7 | (129) | 257 | 108 |
Underlying depreciation and amortisation | (183) | (52) | (7) | (66) | (52) |
Underlying EBIT | 68 | (45) | (136) | 191 | 56 |
| Comprising: | |||||
Group production | 68 | (51) | (136) | 191 | 56 |
Exploration expensed | – | – | – | – | – |
Third party products and services (4) | – | – | – | – | – |
Share of profit/(loss) of equity accounted investments | – | 6 | – | – | – |
Underlying EBIT | 68 | (45) | (136) | 191 | 56 |
| Underlying net finance costs | |||||
| Underlying income tax (expense)/benefit | |||||
| Underlying royalty related tax (expense)/benefit | |||||
| Underlying earnings | |||||
Total adjustments to profit/(loss) (5) | |||||
| Profit/(loss) for the year | |||||
Underlying exploration expenditure | – | – | – | – | – |
Underlying capital expenditure (6) | 82 | 58 | 9 | 18 | 17 |
Underlying equity accounted investments | – | 51 | – | – | – |
Total underlying assets (7) | 3,578 | 880 | 91 | 1,156 | 778 |
Total underlying liabilities (7) | 1,121 | 142 | 63 | 311 | 200 |
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| Discontinued | |||||||||
| Continuing operations | operation | ||||||||
| Group | |||||||||
| Group and | underlying | ||||||||
| unallocated | results from | Illawarra | Group | ||||||
| Australia | South Africa | items/ | continuing | Metallurgical | underlying | ||||
Sierra Gorda (2) | Cannington | Hermosa | Cerro Matoso | Manganese (2) | Manganese (2) | eliminations | operations (2) | Coal (1) | results (2) |
682 | 554 | – | 698 | 720 | 369 | (381) | 7,338 | 1,809 | 9,147 |
2 | (12) | – | – | (32) | (25) | (2) | (71) | (26) | (97) |
684 | 542 | – | 698 | 688 | 344 | (383) | 7,267 | 1,783 | 9,050 |
684 | 542 | – | 698 | 688 | 344 | – | 6,868 | 1,643 | 8,511 |
– | – | – | – | – | – | 399 | 399 | 140 | 539 |
– | – | – | – | – | – | (782) | – | – | – |
684 | 542 | – | 698 | 688 | 344 | (383) | 7,267 | 1,783 | 9,050 |
358 | 213 | (15) | 246 | 369 | 66 | (52) | 1,679 | 855 | 2,534 |
(141) | (71) | (4) | (57) | (103) | (21) | (20) | (777) | (141) | (918) |
217 | 142 | (19) | 189 | 266 | 45 | (72) | 902 | 714 | 1,616 |
221 | 148 | (19) | 191 | 266 | 46 | (42) | 939 | 707 | 1,646 |
(4) | (6) | – | (2) | – | (1) | (42) | (55) | (9) | (64) |
– | – | – | – | – | – | 12 | 12 | 11 | 23 |
– | – | – | – | – | – | – | 6 | 5 | 11 |
217 | 142 | (19) | 189 | 266 | 45 | (72) | 902 | 714 | 1,616 |
(182) | (6) | (188) | |||||||
(246) | (211) | (457) | |||||||
(55) | – | (55) | |||||||
419 | 497 | 916 | |||||||
(1,037) | (52) | (1,089) | |||||||
(618) | 445 | (173) | |||||||
7 | 8 | 20 | 2 | 1 | 1 | 51 | 90 | 17 | 107 |
196 | 61 | 256 | 38 | 58 | 25 | 3 | 821 | 248 | 1,069 |
– | – | – | – | – | – | – | 51 | 7 | 58 |
1,811 | 575 | 1,095 | 581 | 660 | 326 | 2,564 | 14,095 | 1,420 | 15,515 |
223 | 403 | 96 | 218 | 421 | 183 | 2,240 | 5,621 | 519 | 6,140 |
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
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Notes to financial statements – Results for the year continued
4. Segment informationcontinued
(b) Segment results continued
| FY24 | Continuing | Discontinued | |
| US$M | operations | operation (1) | Total |
Underlying EBIT | 445 | 441 | 886 |
Significant items (2) | (50) | – | (50) |
Joint venture adjustments (3)(4) | (284) | – | (284) |
Exchange rate gains/(losses) on restatement of monetary items (5) | (24) | – | (24) |
Net impairment (loss)/reversal of financial assets (5)(6) | (29) | – | (29) |
Net impairment (loss)/reversal of non-financial assets (5)(7) | (801) | 197 | (604) |
Gains/(losses) on non-trading derivative instruments, contingent consideration and other investments measured at FVTPL (5) | 8 | – | 8 |
Profit/(loss) from operations | (735) | 638 | (97) |
Underlying net finance costs | (239) | (10) | (249) |
Joint venture adjustments (3)(4) | 220 | – | 220 |
Exchange rate variations on net debt | 8 | – | 8 |
Net finance income/(costs) | (11) | (10) | (21) |
Underlying income tax (expense)/benefit | (92) | (131) | (223) |
Underlying royalty related tax (expense)/benefit | (36) | – | (36) |
Tax effect of significant items (2) | 15 | – | 15 |
Joint venture adjustments relating to income tax expense (3)(4) | 21 | – | 21 |
Joint venture adjustments relating to royalty related tax expense (3)(4) | 36 | – | 36 |
Tax effect of other adjustments to derive Underlying EBIT | 180 | (58) | 122 |
Tax effect of other adjustments to derive Underlying net finance costs | (2) | – | (2) |
Exchange rate variations on tax balances | (16) | (4) | (20) |
Income tax (expense)/benefit | 106 | (193) | (87) |
Underlying earnings | 78 | 300 | 378 |
Total adjustments to profit/(loss) | (718) | 135 | (583) |
Profit/(loss) for the year | (640) | 435 | (205) |
| Underlying earnings attributable to: | |||
Equity holders of South32 Limited | 80 | 300 | 380 |
Non-controlling interests | (2) | – | (2) |
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SOUTH 32 ANNUAL REPORT 2024
4. Segment information continued
(b) Segment results continued
(i) Underlying results reconciliation continued
FY23 Restated (1) | Continuing | Discontinued | |
| US$M | operations | operation (1) | Total |
Underlying EBIT | 902 | 714 | 1,616 |
Significant items (2) | 237 | (51) | 186 |
Joint venture adjustments (3)(4) | (291) | – | (291) |
Exchange rate gains/(losses) on restatement of monetary items (5) | 61 | 1 | 62 |
Net impairment (loss)/reversal of financial assets (5)(6) | (71) | – | (71) |
Net impairment (loss)/reversal of non-financial assets (5)(7) | (1,300) | – | (1,300) |
Gains/(losses) on non-trading derivative instruments, contingent consideration and other investments measured at FVTPL (5) | (4) | – | (4) |
Profit/(loss) from operations | (466) | 664 | 198 |
Underlying net finance costs | (182) | (6) | (188) |
Joint venture adjustments (3)(4) | 195 | – | 195 |
Exchange rate variations on net debt | 9 | (1) | 8 |
Net finance income/(costs) | 22 | (7) | 15 |
Underlying income tax (expense)/benefit | (246) | (211) | (457) |
Underlying royalty related tax (expense)/benefit | (55) | – | (55) |
Tax effect of significant items (2) | (39) | 16 | (23) |
Joint venture adjustments relating to income tax expense (3)(4) | 96 | – | 96 |
Joint venture adjustments relating to royalty related tax expense (3)(4) | 55 | – | 55 |
Tax effect of other adjustments to derive Underlying EBIT | (2) | (1) | (3) |
Tax effect of other adjustments to derive Underlying net finance costs | (3) | – | (3) |
Exchange rate variations on tax balances | 20 | (16) | 4 |
Income tax (expense)/benefit | (174) | (212) | (386) |
Underlying earnings | 419 | 497 | 916 |
Total adjustments to profit/(loss) | (1,037) | (52) | (1,089) |
Profit/(loss) for the year | (618) | 445 | (173) |
| Underlying earnings attributable to: | |||
Equity holders of South32 Limited | 419 | 497 | 916 |
Non-controlling interests | – | – | – |
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SOUTH 32 ANNUAL REPORT 2024
Notes to financial statements – Results for the year continued
4. Segment information continued
(b) Segment results continued
(i) Underlying results reconciliationcontinued
| Group | Discontinued | Group | ||
| FY24 | underlying | Joint venture | operation | statutory |
| US$M | results | adjustments | adjustments (1) | results |
Total revenue | 8,296 | (1,356) | (1,461) | 5,479 |
Depreciation and amortisation | 916 | (273) | (81) | 562 |
Share of profit/(loss) of equity accounted investments | (31) | (29) | 1 | (59) |
Exploration expenditure (2) | 89 | (14) | – | 75 |
Capital expenditure (2) | 1,357 | (315) | – | 1,042 |
Equity accounted investments | 26 | 376 | (6) | 396 |
Total assets | 15,246 | (1,001) | – | 14,245 |
Total liabilities | 6,275 | (1,001) | – | 5,274 |
| Group | Discontinued | Group | ||
FY23 Restated (1) | underlying | Joint venture | operation | statutory |
| US$M | results | adjustments | adjustments (1) | results |
Total revenue | 9,050 | (1,621) | (1,783) | 5,646 |
Depreciation and amortisation | 918 | (265) | (141) | 512 |
Share of profit/(loss) of equity accounted investments | 11 | 235 | (5) | 241 |
Exploration expenditure (2) | 107 | (9) | – | 98 |
Capital expenditure (2) | 1,069 | (279) | – | 790 |
Equity accounted investments | 58 | 441 | – | 499 |
Total assets | 15,515 | (951) | – | 14,564 |
Total liabilities | 6,140 | (951) | – | 5,189 |
| FY24 | |||
US$M | Gross | Tax | Net |
Tropical Cyclone Megan impacts | (50) | 15 | (35) |
Total significant items | (50) | 15 | (35) |
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SOUTH 32 ANNUAL REPORT 2024
4. Segment informationcontinued
(b) Segment results continued
(ii) Significant itemscontinued
| FY23 | |||
US$M | Gross | Tax | Net |
Disposal of royalties | 189 | (56) | 133 |
Assets write-off | (51) | 16 | (35) |
Tax adjustments relating to the Sierra Gorda acquisition | – | 17 | 17 |
Vendor indemnity relating to the Sierra Gorda acquisition | 48 | – | 48 |
Total significant items | 186 | (23) | 163 |
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4. Segment informationcontinued
Revenue from external customers | Non-current assets | |||
| FY23 | ||||
| US$M | FY24 | Restated (1) | FY24 | FY23 |
Australia | 359 | 263 | 3,350 | 5,239 |
Brazil | 112 | 192 | 797 | 765 |
China | 622 | 695 | – | – |
Italy | 330 | 338 | – | – |
Japan | 304 | 313 | – | – |
Middle East | 319 | 269 | – | – |
Netherlands (2) | 948 | 1,056 | 1,769 | 1,604 |
South Africa | 392 | 495 | 868 | 882 |
South Korea | 299 | 249 | – | – |
United States of America | 397 | 419 | 1,661 | 1,193 |
Rest of Africa | 283 | 346 | 435 | 488 |
Rest of Asia | 319 | 386 | 79 | 100 |
Rest of Europe | 458 | 321 | 8 | 1 |
Rest of North America | 244 | 234 | 2 | 1 |
Rest of Oceania | 93 | 70 | – | – |
Rest of South America | – | – | 307 | 544 |
Unallocated assets (3) | – | – | 570 | 508 |
Total | 5,479 | 5,646 | 9,846 | 11,325 |
| FY23 | |||
US$M | Note | FY24 | Restated (1) |
Changes in inventories of finished goods and work in progress | 49 | (49) | |
Raw materials and consumables used | 2,426 | 2,592 | |
Wages, salaries and redundancies | 554 | 527 | |
Pension and other post-retirement obligations | 51 | 51 | |
External services (including transportation) | 909 | 873 | |
Third party commodity purchases | 436 | 471 | |
Depreciation and amortisation | 562 | 512 | |
Exchange rate (gains)/losses on restatement of monetary items | 24 | (61) | |
(Gains)/losses on derivative instruments, contingent consideration and other investments measured at FVTPL | (3) | (6) | |
Government and other royalties paid and payable | 142 | 179 | |
Exploration expenditure incurred and expensed | 36 | 50 | |
Net impairment loss/(reversal) of financial assets | 19 | 29 | 71 |
Net impairment loss/(reversal) of non-financial assets | 13 | 801 | 1,300 |
Short-term, low-value and variable lease rentals | 58 | 50 | |
All other operating expenses | 189 | 136 | |
Total | 6,263 | 6,696 |
Notes to financial statements – Results for the year continued
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SOUTH 32 ANNUAL REPORT 2024
6. Tax
(a) Income tax expense
| FY23 | ||
US$M | FY24 | Restated (1) |
Current income tax (expense)/benefit | (213) | (476) |
Deferred income tax (expense)/benefit | 126 | 90 |
Total income tax (expense)/benefit | (87) | (386) |
| Income tax (expense)/benefit attributable to: | ||
Continuing operations | 106 | (174) |
Discontinued operation (1) | (193) | (212) |
Total income tax (expense)/benefit | (87) | (386) |
(1) Refer to note 30 Assets and liabilities held for sale and discontinued operations.
(b) Reconciliation of prima facie tax expense to income tax expense
| FY23 | ||
US$M | FY24 | Restated (1) |
Profit/(loss) before tax from continuing operations | (746) | (444) |
Profit/(loss) before tax from a discontinued operation | 628 | 657 |
Deduct: Share of profit/(loss) of equity accounted investments included in continuing operations | (59) | 241 |
Deduct: Share of profit/(loss) of equity accounted investments included in a discontinued operation | (1) | 5 |
Profit/(loss) subject to tax | (58) | (33) |
Income tax on profit/(loss) calculated at 30 per cent | 18 | 10 |
Tax rate differential on non-Australian income | 4 | 1 |
Exchange variations and other translation adjustments | (20) | 4 |
Withholding tax on distributed earnings | – | (36) |
Derecognition of future tax benefits (2) | (14) | (55) |
Non-deductible impairment charges (2) | (77) | (333) |
Colombian royalty expense | 23 | (24) |
Tax adjustments relating to the Sierra Gorda acquisition (3) | – | 31 |
Prior year adjustments | (10) | 4 |
Other | (11) | 12 |
Total income tax (expense)/benefit | (87) | (386) |
(1) Refer to note 30 Assets and liabilities held for sale and discontinued operations.
(2) FY24 primarily relates to the impairment of Cerro Matoso, which resulted in the Group derecognising US$38 million of deferred tax assets and incurring US$38 million of non-
deductible tax expenses. FY23 primarily relates to the impairment of the Taylor Deposit at Hermosa, which resulted in the Group derecognising US$53 million of deferred tax
assets and incurring US$315 million of non-deductible tax expenses. Refer to note 13 Impairment of non-financial assets.
(3) Refer to note 4(b)(ii) Significant items.
Profit/(loss) from equity accounted investments has been taxed in companies other than South32 Limited, being the companies whose
results are disclosed as equity accounted investments in the consolidated financial statements. Refer to note 25 Equity accounted
investments for further details of the Group’s equity accounted investments.
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6. Taxcontinued
| Deferred tax (charged)/credited | ||||||
| to the Consolidated income | ||||||
Deferred tax assets | Deferred tax liabilities | statement (1) | ||||
| US$M | FY24 | FY23 | FY24 (1) | FY23 | FY24 | FY23 |
| Type of temporary difference | ||||||
Depreciation | 96 | 253 | 103 | 261 | 1 | 2 |
Employee benefits | 45 | 49 | (21) | (12) | 5 | 1 |
Closure and rehabilitation | 251 | 234 | (56) | (59) | 14 | 34 |
Other provisions | 14 | – | (3) | (13) | 4 | – |
Deferred charges | – | (52) | 83 | – | (31) | 8 |
| Non tax-depreciable fair value adjustments, revaluations | ||||||
and mineral rights | (8) | (95) | 2 | 11 | 96 | – |
Tax-effected losses | 94 | 15 | – | (54) | 25 | 57 |
Brazil deferral incentive (2) | – | – | 61 | 70 | 9 | (6) |
Leases | 20 | (1) | (2) | (1) | 22 | (1) |
Other | (31) | (13) | 9 | 7 | (19) | (5) |
Total | 481 | 390 | 176 | 210 | 126 | 90 |
US$M | FY24 | FY23 |
| Unrecognised deferred tax assets | ||
Tax-effected losses (1) | 61 | 58 |
Mineral rights | 617 | 617 |
Impairment of investments in subsidiaries | 1,233 | 949 |
Closure and rehabilitation | 99 | 48 |
Depreciable assets | 70 | 32 |
Other temporary differences | 6 | 1 |
Total unrecognised deferred tax assets | 2,086 | 1,705 |
| Unrecognised deferred tax liabilities | ||
Taxable temporary differences associated with investments and undistributed earnings in subsidiaries | 36 | 33 |
Total unrecognised deferred tax liabilities | 36 | 33 |
Notes to financial statements – Results for the year continued
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SOUTH 32 ANNUAL REPORT 2024
6. Taxcontinued
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7. Dividends
US$M | FY24 | FY23 |
Prior year final dividend (1) | 145 | 646 |
Prior year special dividend | – | 138 |
Interim dividend (2) | 18 | 223 |
Total dividends declared and paid during the year | 163 | 1,007 |
(1) On 24 August 2023, the Directors resolved to pay a fully franked final dividend of US 3.2 cents per share (US$145 million) in respect of the 2023 financial year. The dividends were
paid on 12 October 2023.
(2) On 15 February 2024, the Directors resolved to pay a fully franked interim dividend of US 0.4 cents per share (US$18 million) in respect of the 2024 financial half year. The
dividends were paid on 4 April 2024.
Franking account
US$M | FY24 | FY23 |
Franking credits at the beginning of the financial year | 538 | 678 |
Credits arising from tax paid/payable by South32 Limited (1) | 137 | 243 |
Credits arising from receipt of franked dividends | 32 | 68 |
Utilisation of credits arising from the payment of franked dividends | (72) | (426) |
Exchange rate variations | – | (25) |
Total franking credits available at the end of the financial year (2) | 635 | 538 |
(1) Includes the Australia FY24 income tax liability of US$19 million.
(2) The payment of the final franked FY24 dividend declared after 30 June 2024 will decrease the franking account balance by US$60 million. Refer to note 31 Subsequent events.
| Profit/(loss) attributable to equity holders | FY23 | |
US$M | FY24 | Restated (1) |
Continuing operations | (638) | (618) |
Discontinued operation (1) | 435 | 445 |
Profit/(loss) attributable to equity holders of South32 Limited (basic) | (203) | (173) |
Profit/(loss) attributable to equity holders of South32 Limited (diluted) | (203) | (173) |
| Weighted average number of shares | ||
Million | FY24 | FY23 |
Basic earnings/(loss) per share denominator (1) | 4,519 | 4,572 |
Diluted earnings/(loss) per share denominator (2) | 4,519 | 4,572 |
| Earnings/(loss) per share | FY23 | |
US cents | FY24 | Restated (1) |
| Continuing operations | ||
Basic earnings/(loss) per share | (14.1) | (13.5) |
Diluted earnings/(loss) per share | (14.1) | (13.5) |
| Attributable to ordinary equity holders of South32 Limited | ||
Basic earnings/(loss) per share | (4.5) | (3.8) |
Diluted earnings/(loss) per share | (4.5) | (3.8) |
Notes to financial statements – Results for the year continued
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SOUTH 32 ANNUAL REPORT 2024
This section shows the assets used to generate the Group’s trading performance and the liabilities incurred. Assets and liabilities
relating to the Group’s financing activities are addressed in the capital structure and financing section, notes 16 to 20.
US$M | FY24 | FY23 |
| Current | ||
Trade receivables | 398 | 395 |
Loans to equity accounted investments (1)(2) | 73 | 114 |
Other receivables | 163 | 269 |
Total current trade and other receivables (3) | 634 | 778 |
| Non-current | ||
Loans to equity accounted investments (1)(2) | 1,933 | 1,790 |
Other receivables | 150 | 133 |
Total non-current trade and other receivables (3) | 2,083 | 1,923 |
US$M | FY24 | FY23 |
| Current | ||
Raw materials and consumables | 484 | 519 |
Work in progress | 299 | 333 |
Finished goods | 202 | 250 |
Total current inventories | 985 | 1,102 |
| Non-current | ||
Raw materials and consumables | 41 | 57 |
Work in progress | 22 | 25 |
Total non-current inventories | 63 | 82 |
Notes to financial statements – Operating assets and liabilities
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Notes to financial statements – Operating assets and liabilities continued
Land and buildings | Plant and equipment | Exploration | ||||||
| FY24 | Right-of-use | Owned | Right-of-use | Owned | Other mineral | Assets under | and | |
| US$M | assets | assets | assets | assets | assets (1) | construction | evaluation | Total |
| Cost | ||||||||
At the beginning of the year | 43 | 2,413 | 1,051 | 13,408 | 4,470 | 1,235 | 245 | 22,865 |
Additions | 2 | – | 72 | 51 | – | 901 | 53 | 1,079 |
| Foreign exchange | ||||||||
movements in closure and rehabilitation provisions (2) | – | – | – | (11) | – | – | – | (11) |
Disposals | (2) | – | – | (50) | (54) | (21) | – | (127) |
Reclassified as held for sale (3) | (6) | (125) | (29) | (2,093) | (1,187) | (477) | (38) | (3,955) |
Transfers and other movements | – | 55 | – | 337 | 102 | (314) | (180) | – |
At the end of the year | 37 | 2,343 | 1,094 | 11,642 | 3,331 | 1,324 | 80 | 19,851 |
| Accumulated depreciation | ||||||||
| and impairments | ||||||||
At the beginning of the year | 18 | 1,516 | 380 | 9,533 | 3,053 | 170 | 145 | 14,815 |
Depreciation (4) | 7 | 77 | 67 | 417 | 69 | – | – | 637 |
Net impairments (5) | – | 61 | 53 | 233 | 225 | (4) | – | 568 |
Disposals | (2) | – | – | (48) | (54) | – | – | (104) |
Reclassified as held for sale (3) | (4) | (72) | (19) | (1,638) | (775) | (47) | (13) | (2,568) |
Transfers and other movements | – | – | – | – | – | 132 | (132) | – |
At the end of the year | 19 | 1,582 | 481 | 8,497 | 2,518 | 251 | – | 13,348 |
| Net book value at the end | ||||||||
of the year | 18 | 761 | 613 | 3,145 | 813 | 1,073 | 80 | 6,503 |
Land and buildings | Plant and equipment | Exploration | ||||||
| FY23 | Right-of-use | Owned | Right-of-use | Owned | Other mineral | Assets under | and | |
| US$M | assets | assets | assets | assets | assets (1) | construction | evaluation | Total |
| Cost | ||||||||
At the beginning of the year | 37 | 2,352 | 943 | 13,204 | 4,547 | 815 | 212 | 22,110 |
Additions | 6 | – | 91 | 133 | – | 815 | 84 | 1,129 |
| Foreign exchange | ||||||||
movements in closure and rehabilitation provisions (2) | – | – | – | (68) | – | – | – | (68) |
Disposals | – | (3) | – | (112) | (140) | – | (51) | (306) |
Transfers and other movements | – | 64 | 17 | 251 | 63 | (395) | – | – |
At the end of the year | 43 | 2,413 | 1,051 | 13,408 | 4,470 | 1,235 | 245 | 22,865 |
| Accumulated depreciation | ||||||||
| and impairments | ||||||||
At the beginning of the year | 15 | 1,438 | 316 | 9,239 | 2,050 | 51 | 13 | 13,122 |
Depreciation (3) | 3 | 78 | 64 | 402 | 94 | – | – | 641 |
Net impairments (4) | – | – | – | – | 1,049 | 119 | 132 | 1,300 |
Disposals | – | – | – | (108) | (140) | – | – | (248) |
At the end of the year | 18 | 1,516 | 380 | 9,533 | 3,053 | 170 | 145 | 14,815 |
| Net book value at the end | ||||||||
of the year | 25 | 897 | 671 | 3,875 | 1,417 | 1,065 | 100 | 8,050 |
134
SOUTH 32 ANNUAL REPORT 2024
11. Property, plant and equipmentcontinued
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
135
SOUTH 32 ANNUAL REPORT 2024
Notes to financial statements – Operating assets and liabilities continued
11.
Property, plant and equipment continued
Category | Useful life |
Buildings | 25 to 40 years straight-line |
Land | not depreciated |
Plant and equipment | 3 to 30 years straight-line |
ROU assets | based on the shorter of the useful life or the lease term (straight-line) |
Mineral rights | based on Ore Reserves on a units of production basis |
Capitalised exploration, evaluation and development expenditure | based on Ore Reserves on a units of production basis |
136
SOUTH 32 ANNUAL REPORT 2024
| FY24 | Other | ||
US$M | Goodwill | intangibles | Total |
| Cost | |||
At the beginning of the year | 139 | 328 | 467 |
Exchange rate variations taken to reserves | – | 1 | 1 |
Additions | – | 4 | 4 |
Acquisition of a subsidiary (1) | – | 20 | 20 |
Reclassified as held for sale (2) | – | (1) | (1) |
At the end of the year | 139 | 352 | 491 |
| Accumulated amortisation and impairments | |||
At the beginning of the year | – | 225 | 225 |
Amortisation | – | 10 | 10 |
Net impairments (3) | – | 36 | 36 |
Reclassified as held for sale (2) | – | (1) | (1) |
At the end of the year | – | 270 | 270 |
Net book value at the end of the year | 139 | 82 | 221 |
| FY23 | Other | ||
US$M | Goodwill | intangibles | Total |
| Cost | |||
At the beginning of the year | 139 | 284 | 423 |
Additions | – | 69 | 69 |
Disposals | – | (25) | (25) |
At the end of the year | 139 | 328 | 467 |
| Accumulated amortisation and impairments | |||
At the beginning of the year | – | 237 | 237 |
Amortisation | – | 13 | 13 |
Disposals | – | (25) | (25) |
At the end of the year | – | 225 | 225 |
Net book value at the end of the year | 139 | 103 | 242 |
Category | Useful life |
Software and licences | 5 years |
Contract based intangible assets | up to 35 years |
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
137
SOUTH 32 ANNUAL REPORT 2024
US$M | Note | FY24 | FY23 |
| Impairment | |||
Property, plant and equipment (1)(2) | 11 | 729 | 1,300 |
ROU assets (1) | 11 | 53 | – |
Intangible assets (1) | 12 | 36 | – |
| Impairment reversal | |||
Property, plant and equipment (3) | 11 | (214) | – |
Total net impairment | 604 | 1,300 |
FY24 | Assumptions used |
Alumina price (US$/t) | 395 to 480 |
Foreign exchange rates (AU$ to US$) | 0.67 to 0.75 |
Notes to financial statements – Operating assets and liabilities continued
138
SOUTH 32 ANNUAL REPORT 2024
13. Impairment of non-financial assetscontinued
(a) Impairments and impairment reversals - 30 June 2024continued
Worsley Alumina continued
Costs of production – Estimated costs of production are based on management's planning processes, which include assumptions on
forecast operating, energy and raw materials expenditures.
The following table illustrates the sensitivity of the recoverable amount of Worsley Alumina to a reasonable possible change in the
aforementioned assumptions. Owing to the complexity of the relationships between each key assumption, the analysis was performed
for each assumption individually (all other assumptions held constant).
| Change in key | Impact on recoverable amount (US$M) | ||
FY24 | assumption | Favourable | Unfavourable |
Alumina price (US$/t) | 10% | 1,215 | (1,215) |
Foreign exchange rates (AU$ to US$) | 10% | 855 | (855) |
Costs of production | 10% | 855 | (855) |
Discount rate | 100 basis points | 110 | (100) |
Regulatory approvals – The life of operation plan which informed the production profile includes the assumption that Worsley Alumina
will be able to obtain the necessary future regulatory approvals required to continue operating to plan. This includes the Group's
expectation that the Worsley Mine Development Project will secure environmental approval based on conditions that are reasonable,
aligned with existing legislation and scientifically based.
Mineral Resource estimation – The Mineral Resource estimate of Worsley Alumina is reported in accordance with the JORC Code, and
the ASX Listing Rules (Chapter 5): Additional reporting on mining and oil and gas production and exploration activities. Refer to the
Mineral Resources and Ore Reserves section of note 2(c) for further information on these estimates.
Cerro Matoso
During FY24, the Group commenced a strategic review of Cerro Matoso to evaluate options to enhance the operation’s competitive
position. During this review, the Group identified an impairment indicator for the Cerro Matoso CGU and recognised a resulting
impairment of US$264 million. The recoverable amount of Cerro Matoso was determined as US$54 million based on its FVLCD.
The impairment reflects structural changes observed in the nickel market which are expected to continue to place pressure on nickel
prices and discounts for the Group’s ferronickel product. Furthermore, the impairment reflects a decision of the Group to limit further
capital investment into the region in the light of the uncertainty created by recent tax law increases and the increased frequency of tax
audits.
Cerro Matoso, which is also an operating segment, consists of an integrated laterite ferronickel mine and smelting complex in Colombia.
The impairment of US$264 million includes US$228 million of property, plant and equipment and US$36 million of intangible assets. The
impairment of property, plant and equipment includes US$45 million recognised in land and buildings, US$154 million recognised in
plant and equipment and US$29 million recognised in other mineral assets.
The fair value measurement was categorised as a Level 3 fair value based on the inputs in the discounted cash flow valuation model
(refer to note 19 Financial assets and financial liabilities), and was determined using a real US$ post tax discount rate of 7 per cent with
a country risk premium of 2 per cent. The recoverable amount was informed by a production profile and costs based on management’s
planning processes. The key assumptions used in the determination of the FVLCD were:
– Ferronickel price;
– Foreign exchange rates; and
– Mineral Resource estimation.
Ferronickel price and foreign exchange rates – The ferronickel price, in real terms, and exchange rates used in the FVLCD
determinations were within the following ranges:
FY24 | Assumptions used | |
Ferronickel price (US$/lb) | 6.30 to 7.00 | |
Foreign exchange rates (US$ to COP) | 4,180 to | 4,295 |
The following table illustrates the sensitivity of the recoverable amount of Cerro Matoso to a reasonable possible change in the
aforementioned assumptions. Owing to the complexity of the relationships between each key assumption, the analysis was performed
for each assumption individually (all other assumptions held constant).
| Change in key | Impact on recoverable amount (US$M) | ||
FY24 | assumption | Favourable | Unfavourable |
Ferronickel price (US$/lb) | 10% | 140 | (165) |
Foreign exchange rates (US$ to COP) | 10% | 70 | (95) |
Mineral Resource estimation – The Mineral Resource estimate of Cerro Matoso is reported in accordance with the JORC Code, and the
ASX Listing Rules (Chapter 5): Additional reporting on mining and oil and gas production and exploration activities. Refer to the Mineral
Resources and Ore Reserves section of note 2(c) for further information on these estimates.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
139
SOUTH 32 ANNUAL REPORT 2024
13. Impairment of non-financial assetscontinued
(a) Impairments and impairment reversals - 30 June 2024continued
Illawarra Metallurgical Coal
In February 2024, the Group announced its decision to enter into a binding agreement to sell Illawarra Metallurgical Coal and reclassified
the disposal group as held for sale.
The recoverable amount of the Illawarra Metallurgical Coal disposal group was assessed and as a result a US$197 million impairment
reversal of property, plant and equipment was recognised. The impairment reversal includes US$14 million of land and buildings,
US$97 million of plant and equipment and US$86 million of other mineral assets.
The recoverable amount of US$1,236 million was determined using the FVLCD methodology, informed by the consideration expected to
be received, less costs of disposal, inclusive of the fair value of contingent price-linked consideration determined to be US$115 million.
Refer to note 30 Assets and liabilities held for sale and discontinued operations for further details.
The fair value of the contingent price-linked consideration is categorised as a Level 3 fair value based on the inputs used in the valuation
(refer to note 19 Financial assets and financial liabilities), including metallurgical coal prices within a range of US$190/t to US$225/t and
a real US$ post tax discount rate of 7 per cent. The following table illustrates the sensitivity of this fair value to a reasonable possible
change in the metallurgical coal price assumption.
| Change in key | Impact on recoverable amount (US$M) | ||
FY24 | assumption | Favourable | Unfavourable |
Metallurgical coal price (US$/t) | 10% | 150 | (115) |
As at 30 June 2024, the recoverable amount approximates the carrying value of the disposal group held for sale.
Eagle Downs Metallurgical Coal
In February 2024, the Group announced its decision to enter into a binding agreement to sell its 50 per cent interest in Eagle Downs
Metallurgical Coal and reclassified the disposal group as held for sale.
The recoverable amount of the Group's interest in Eagle Downs Metallurgical Coal was assessed and as a result a US$17 million
impairment reversal of property, plant and equipment was recognised. The impairment reversal includes US$13 million of other mineral
assets and US$4 million of assets under construction.
The recoverable amount of US$16 million was determined using the FVLCD methodology, informed by the consideration expected
to be received, less costs of disposal, inclusive of the fair value of contingent price-linked consideration. The contingent price-linked
consideration was valued at nil based on the Group’s assessment of development risk which is a prerequisite for the contingent
payment and price-linked royalty to be applied. Refer to note 30 Assets and liabilities held for sale and discontinued operations for
further details.
As at 30 June 2024, the recoverable amount approximates the carrying value of the disposal group held for sale.
(b) Impairments - 30 June 2023
Hermosa – Taylor Deposit
In August 2018, the Group completed its acquisition of the Hermosa project located in the United States. The Hermosa project
comprises the zinc-lead-silver sulphide deposit (Taylor Deposit), the manganese-zinc-silver oxide deposit (Clark Deposit) and a land
package with the potential for further polymetallic and copper mineralisation (Land Package). In FY23, the Group advanced the
feasibility study for the Taylor Deposit, completed a pre-feasibility selection study for the Clark Deposit and announced that the US
Federal Permitting Improvement Steering Council, an independent federal agency, had confirmed the Hermosa project as the first
mining project added to the FAST-41 process. Since acquisition, the fair value of the Taylor Deposit had been negatively impacted by
delayed first production as a result of COVID-19 related restrictions and significant dewatering requirements, as well as capital cost
escalation in line with industry-wide inflation.
Study work completed in FY23 confirmed that the Taylor Deposit and the Clark Deposit can be developed independently. As a result,
the Group identified three separate areas of interest within the Hermosa project: the Taylor Deposit, the Clark Deposit and the Regional
Land Package. On separation into three separate areas of interest, the Group allocated the carrying value of the previous single
Hermosa area of interest to each of the newly identified and separate areas of interest.
As a result of the study work, the Group identified an impairment indicator for the Taylor Deposit and recognised a resulting impairment
of property, plant and equipment of US$1,300 million in FY23. The impairment of US$1,300 million includes US$1,049 million recognised
in other mineral assets, US$119 million recognised in assets under construction and US$132 million recognised in exploration and
evaluation. The recoverable amount of the Taylor Deposit was determined as US$482 million based on its FVLCD.
The fair value measurement was categorised as a Level 3 fair value based on the inputs in the discounted cash flow valuation model
(refer to note 19 Financial assets and financial liabilities). The recoverable amount was informed by inputs from the feasibility study in
progress for the Taylor Deposit, including the expected technical performance of the deposit as well as expected capital and operating
costs for the life of the operation. Refer to the Key estimates, assumptions and judgements section of this note for further details on the
key assumptions and sensitivities related to the recoverable amount of the Taylor deposit.
Notes to financial statements – Operating assets and liabilities continued
140
SOUTH 32 ANNUAL REPORT 2024
13. Impairment of non-financial assetscontinued
(c) Impairment test for CGUs containing goodwill
The carrying amount of goodwill has been allocated to the following CGU:
US$M | Note | FY24 | FY23 |
Hillside Aluminium | 139 | 139 | |
Total goodwill | 12 | 139 | 139 |
The goodwill arose from the acquisition of Alusaf in Hillside Aluminium (Pty) Ltd and has been allocated to the Hillside Aluminium CGU
which comprises the Hillside aluminium smelter. The recoverable amount of the Hillside Aluminium CGU was determined based on a
FVLCD calculation, using a real US$ post tax discount rate of 7 per cent (FY23: 7 per cent), and a country risk premium of 2 per cent
(FY23: 2 per cent) applied to discount future cash flows expressed in real terms, and was categorised as a Level 3 fair value based
on the inputs in the valuation technique (refer to note 19 Financial assets and financial liabilities). The key assumptions used in the
determination of FVLCD were:
– Aluminium and alumina prices;
– Foreign exchange rates;
– Production volumes;
– Carbon pricing and timing; and
– Discount rate.
Aluminium and alumina prices, and foreign exchange rates – The ranges of aluminium prices, alumina prices and exchange rates, in real
terms, used in the FVLCD determinations, along with the sensitivity of the recoverable amount of Hillside Aluminium to a reasonable
possible change in these assumptions, based on unfavourably changing these assumptions by 10 per cent whilst holding all other
variables constant, are shown in the table below:
| Impact on recoverable | |||
FY24 | Assumptions used | amount (US$M) | |
Alumina price (US$/t) | 395 to 480 | (220) | |
Aluminium price (US$/t) | 2,495 to | 2,575 | (665) |
Foreign exchange rates (US$ to ZAR) | 17.2 to 18.6 | (310) |
Production volumes – Estimated production volumes are based on the life of the smelter as determined by management as part of its
long-term planning process. Production volumes are influenced by production input costs such as electricity prices, jurisdiction-based
carbon pricing, and the selling price of aluminium.
Carbon pricing and timing – In determining the FVLCD, the current jurisdiction enacted carbon price, in real terms, of ZAR209 to ZAR454
per tonne CO2-e (FY23: ZAR186 to ZAR474 per tonne CO2-e) was applied for the life of operation for Scope 1 and 2 emissions, net of
operation specific abatement allowances.
The impairment test for the Hillside Aluminium CGU indicated that no impairment was required. At 30 June 2024 the carrying value
approximates its recoverable amount. As such any material long-term unfavourable change in the aforementioned key assumptions
could lead to the carrying value exceeding the recoverable amount. The relationships between each key assumption are complex, such
that a change in one may cause a change in several other inputs.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
141
SOUTH 32 ANNUAL REPORT 2024
13. Impairment of non-financial assetscontinued
| The key estimates and assumptions used in the assessment of impairment indicators are as follows: | |
Future production | Life of operation plans based on Mineral Resource and Ore Reserve estimates, economic life of |
| smelters and refineries and, in certain cases, Exploration Targets and expansion projects, including | |
| future cost of production. Refer to note 2(c) Key estimates, assumptions and judgements for further | |
| details regarding Mineral Resources and Ore Reserves as sources of estimation uncertainty. | |
| Commodity prices | Short-term price assumptions are based on an assessment of market signposts including observed |
| and market traded | prices such as forwards, futures and reported transactions. Long-term price estimates are typically |
| consumables | developed based on the demand and supply drivers of a commodity, refer to note 2(c) Key estimates, |
| assumptions and judgements for further details regarding our base case commodity price outlook. | |
Exchange rates | Short-term exchange rate estimates are guided primarily by spot or forward exchange rates. Longer |
| term estimates are based on an assessment of available market data and economic indicators. | |
Discount rates | Risk-adjusted cost of capital appropriate to the resource. |
Regulatory approvals | Life of operation plans include assumptions associated with the successful application, and timing |
| thereof, of ongoing and future regulatory approvals. | |
Carbon prices | Actual enacted schemes less allowable abatements, where applicable, and a long-term base case |
| estimate of US$67 per tonne CO2-e (real) applied to all Scope 1 and 2 emissions from FY40 onwards. |
Notes to financial statements – Operating assets and liabilities continued
142
SOUTH 32 ANNUAL REPORT 2024
13. Impairment of non-financial assetscontinued
Key estimates, assumptions and judgements continued
Long-run commodity prices in real terms | Assumptions used | |||
| Zinc, lead and silver prices | Zinc (US$/t) | 2,820 to | 3,240 | |
| Lead (US$/t) | 2,095 to | 2,190 | ||
| Silver (US$/oz) | 21 to 29 | |||
| The discounted cash flow calculations include an estimate of pre-production capital to support | ||||
| Pre-production capital | the development of the Taylor Deposit to its nameplate capacity of up to 4.3 million tonnes | |||
| expenditure | per annum. Key inputs including steel, cement and electrical components are subject to | |||
| uncertainties, including industry-wide inflation. | ||||
| The Mineral Resource estimate of the Taylor Deposit is reported in accordance with the JORC | ||||
| Mineral Resource estimation | Code, and the ASX Listing Rules (Chapter 5): Additional reporting on mining and oil and gas | |||
| production and exploration activities. Refer to the Mineral Resources and Ore Reserves section | ||||
| of note 2(c) for further information on these estimates. | ||||
| Development and construction continues to progress at the Taylor Deposit following the final | ||||
| investment decision in February 2024. The addition of the Hermosa project to the FAST-41 | ||||
| Development approvals | process has reduced the expected timing of Federal environmental approvals and permits | |||
| by approximately two years. A Record of Decision (RoD) to permit surface disturbance | ||||
| and additional tailings storage on unpatented land will require completion of the National | ||||
| Environmental Policy Act process with the United States Forest Service. | ||||
| Discount rate | A real US$ post tax discount rate of 7 per cent was applied to discount future cash flows | |||
| expressed in real terms. | ||||
| Change in key | Impact on recoverable amount (US$M) | ||
| FY24 | assumption | Favourable | Unfavourable |
| Zinc prices | 10% | 310 | (310) |
| Lead prices | 10% | 260 | (260) |
| Silver prices | 10% | 140 | (140) |
| Pre-production capital expenditure | 10% | 195 | (195) |
| Discount rate | 100 basis points | 360 | (305) |
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
143
SOUTH 32 ANNUAL REPORT 2024
13. Impairment of non-financial assetscontinued
Key estimates, assumptions and judgements continued
US$M | FY24 | FY23 |
| Current | ||
Trade creditors | 665 | 854 |
Other creditors | 140 | 131 |
Total current trade and other payables | 805 | 985 |
| Non-current | ||
Trade creditors | – | 18 |
Other creditors | 1 | 1 |
Total non-current trade and other payables | 1 | 19 |
US$M | FY24 | FY23 |
| Current | ||
Employee benefits | 159 | 177 |
Closure and rehabilitation | 9 | 7 |
Other | 11 | 10 |
Total current provisions | 179 | 194 |
| Non-current | ||
Employee benefits | 7 | 6 |
Closure and rehabilitation | 1,858 | 1,931 |
Post-retirement employee benefits | 30 | 33 |
Other | 9 | 16 |
Total non-current provisions | 1,904 | 1,986 |
Notes to financial statements – Operating assets and liabilities continued
144
SOUTH 32 ANNUAL REPORT 2024
15. Provisionscontinued
| Post- | |||||
| retirement | |||||
| FY24 | Employee | Closure and | employee | ||
| US$M | benefits | rehabilitation | benefits | Other | Total |
At the beginning of the year | 183 | 1,938 | 33 | 26 | 2,180 |
| Charge/(credit) to the Consolidated income statement: | |||||
Underlying | 156 | 12 | 3 | 3 | 174 |
Discounting (1) | – | 132 | – | – | 132 |
Change in discount rate | – | (3) | – | – | (3) |
Net interest expense | – | – | 2 | – | 2 |
Released during the year | (15) | (2) | – | – | (17) |
Amounts capitalised for change in costs and estimates | – | 68 | – | – | 68 |
Amounts capitalised for change in discount rate | – | (17) | – | – | (17) |
Foreign exchange amounts capitalised | – | (11) | – | – | (11) |
Amounts taken to retained earnings | – | – | (4) | – | (4) |
Utilisation | (132) | (15) | (4) | (7) | (158) |
Reclassified as held for sale (2) | (26) | (235) | – | (2) | (263) |
At the end of the year | 166 | 1,867 | 30 | 20 | 2,083 |
| Post- | |||||
| retirement | |||||
| FY23 | Employee | Closure and | employee | ||
| US$M | benefits | rehabilitation | benefits | Other | Total |
At the beginning of the year | 175 | 1,793 | 34 | 19 | 2,021 |
| Charge/(credit) to the Consolidated income statement: | |||||
Underlying | 167 | 16 | 5 | 7 | 195 |
Discounting (1) | – | 91 | – | – | 91 |
Net interest expense | – | – | 3 | – | 3 |
Exchange rate variations | (7) | (15) | (3) | 1 | (24) |
Released during the year | (1) | (7) | – | – | (8) |
Amounts capitalised for change in costs and estimates | – | 149 | – | – | 149 |
Amounts capitalised for change in discount rate | – | (16) | – | – | (16) |
Foreign exchange amounts capitalised | – | (68) | – | – | (68) |
Amounts taken to retained earnings | – | – | (3) | – | (3) |
Utilisation | (151) | (5) | (3) | (1) | (160) |
At the end of the year | 183 | 1,938 | 33 | 26 | 2,180 |
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15. Provisionscontinued
(b) Closure and rehabilitationcontinued
Notes to financial statements – Operating assets and liabilities continued
146
SOUTH 32 ANNUAL REPORT 2024
This section outlines how the Group manages its capital and related financing activities.
US$M | FY24 | FY23 |
Cash | 663 | 611 |
Short-term deposits | 179 | 647 |
Cash and cash equivalents (1)(2) | 842 | 1,258 |
US$M | FY24 | FY23 |
| Current | ||
Lease liabilities | 58 | 51 |
Unsecured loans from equity accounted investments (1) | 138 | 287 |
Unsecured other | 27 | 27 |
Total current interest bearing liabilities | 223 | 365 |
| Non-current | ||
Lease liabilities | 614 | 623 |
Senior unsecured notes | 692 | 690 |
Unsecured other | 37 | 63 |
Total non-current interest bearing liabilities | 1,343 | 1,376 |
| Other interest | Total interest | ||
| FY24 | Lease | bearing | bearing |
| US$M | liabilities | liabilities | liabilities |
At the beginning of the year | 674 | 1,067 | 1,741 |
| Cash movements: | |||
Proceeds from interest bearing liabilities | – | 200 | 200 |
Repayment of interest bearing liabilities (1) | (54) | (355) | (409) |
Interest paid | (53) | (59) | (112) |
| Non-cash movements: | |||
Interest expense | 53 | 59 | 112 |
Net increase/(decrease) of interest bearing liabilities | 72 | – | 72 |
Reclassified as held for sale (2) | (20) | – | (20) |
Exchange rate variations | – | (18) | (18) |
At the end of the year | 672 | 894 | 1,566 |
Notes to financial statements – Capital structure and financing
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17. Interest bearing liabilities continued
| Other interest | Total interest | ||
| FY23 | Lease | bearing | bearing |
| US$M | liabilities | liabilities | liabilities |
At the beginning of the year | 650 | 1,177 | 1,827 |
| Cash movements: | |||
Repayment of interest bearing liabilities | (46) | (87) | (133) |
Interest paid | (52) | (57) | (109) |
| Non-cash movements: | |||
Interest expense | 52 | 59 | 111 |
Net increase/(decrease) of interest bearing liabilities (1) | 93 | (41) | 52 |
Exchange rate variations | (23) | 16 | (7) |
At the end of the year | 674 | 1,067 | 1,741 |
| FY23 | ||
US$M | FY24 | Restated (1) |
| Finance income | ||
Interest on loans to equity accounted investments | 178 | 160 |
Other interest income | 44 | 60 |
Total finance income | 222 | 220 |
| Finance costs | ||
Interest on borrowings | (65) | (68) |
Interest on lease liabilities | (52) | (52) |
Discounting on provisions and other liabilities | (125) | (84) |
Change in discount rate on closure and rehabilitation provisions | 3 | – |
Net interest expense on post-retirement employee benefits | (2) | (3) |
Exchange rate variations on net debt | 8 | 9 |
Total finance costs | (233) | (198) |
Net finance income/(costs) | (11) | 22 |
Notes to financial statements – Capital structure and financing continued
148
SOUTH 32 ANNUAL REPORT 2024
| FY24 | Designated as | ||||
US$M | Note | Held at FVTPL | FVOCI | Amortised cost | Total |
| Financial assets | |||||
| Cash and cash equivalents | 16 | – | – | 842 | 842 |
Trade and other receivables (1) | 9 | 120 | – | 403 | 523 |
| Other financial assets: | |||||
Derivative contracts | 1 | – | – | 1 | |
Total current financial assets | 121 | – | 1,245 | 1,366 | |
Trade and other receivables (1) | 9 | – | – | 1,951 | 1,951 |
| Other financial assets: | |||||
Investments in equity instruments designated as FVOCI | – | 89 | – | 89 | |
Total non-current financial assets | – | 89 | 1,951 | 2,040 | |
Total financial assets | 121 | 89 | 3,196 | 3,406 | |
| Financial liabilities | |||||
Trade and other payables (2) | 14 | 3 | – | 782 | 785 |
| Interest bearing liabilities | 17 | – | – | 223 | 223 |
Total current financial liabilities | 3 | – | 1,005 | 1,008 | |
| Interest bearing liabilities | 17 | – | – | 1,343 | 1,343 |
| Other financial liabilities: | |||||
Contingent consideration payable | 17 | – | – | 17 | |
Total non-current financial liabilities (2) | 17 | – | 1,343 | 1,360 | |
Total financial liabilities | 20 | – | 2,348 | 2,368 |
| FY23 | Designated as | ||||
US$M | Note | Held at FVTPL | FVOCI | Amortised cost | Total |
| Financial assets | |||||
Cash and cash equivalents | 16 | – | – | 1,258 | 1,258 |
Trade and other receivables (1) | 9 | 105 | – | 532 | 637 |
| Other financial assets: | |||||
Derivative contracts | 1 | – | – | 1 | |
Total current financial assets | 106 | – | 1,790 | 1,896 | |
Trade and other receivables (1) | 9 | – | – | 1,802 | 1,802 |
| Other financial assets: | |||||
Investments in equity instruments designated as FVOCI | – | 108 | – | 108 | |
Contingent consideration receivable | 10 | – | – | 10 | |
Total non-current financial assets | 10 | 108 | 1,802 | 1,920 | |
Total financial assets | 116 | 108 | 3,592 | 3,816 | |
| Financial liabilities | |||||
Trade and other payables (2) | 14 | 6 | – | 962 | 968 |
Interest bearing liabilities | 17 | – | – | 365 | 365 |
Total current financial liabilities | 6 | – | 1,327 | 1,333 | |
Trade and other payables (2) | 14 | – | – | 18 | 18 |
Interest bearing liabilities | 17 | – | – | 1,376 | 1,376 |
| Other financial liabilities: | |||||
Contingent consideration payable | 37 | – | – | 37 | |
Total non-current financial liabilities | 37 | – | 1,394 | 1,431 | |
Total financial liabilities | 43 | – | 2,721 | 2,764 |
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19. Financial assets and financial liabilitiescontinued
| FY24 | ||||
US$M | Level 1 | Level 2 | Level 3 | Total |
| Financial assets and liabilities | ||||
Trade and other receivables | – | 120 | – | 120 |
Trade and other payables | – | (3) | – | (3) |
Derivative contract assets | 1 | – | – | 1 |
Investments in equity instruments designated as FVOCI | 80 | – | 9 | 89 |
Contingent consideration payable | – | – | (17) | (17) |
Total | 81 | 117 | (8) | 190 |
| FY23 | ||||
US$M | Level 1 | Level 2 | Level 3 | Total |
| Financial assets and liabilities | ||||
Trade and other receivables | – | 105 | – | 105 |
Trade and other payables | – | (6) | – | (6) |
Derivative contract assets | 1 | – | – | 1 |
Investments in equity instruments designated as FVOCI | 101 | – | 7 | 108 |
Contingent consideration receivable | – | – | 10 | 10 |
Contingent consideration payable | – | – | (37) | (37) |
Total | 102 | 99 | (20) | 181 |
US$M | FY24 | FY23 |
At the beginning of the year | (20) | (45) |
Addition of financial assets | 1 | 15 |
Reclassification of financial asset from level 3 to level 2 (1) | – | (39) |
Unrealised gains recognised in the Consolidated income statement (2) | 10 | 47 |
Unrealised gains recognised in the Consolidated statement of comprehensive income (3) | 1 | 2 |
At the end of the year | (8) | (20) |
Notes to financial statements – Capital structure and financing continued
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SOUTH 32 ANNUAL REPORT 2024
19. Financial assets and financial liabilitiescontinued
US$M | FY24 | FY23 |
| Financial assets | ||
Cash and cash equivalents | 788 | 1,218 |
Trade and other receivables | 28 | 153 |
| Financial liabilities | ||
Interest bearing liabilities | (138) | (286) |
Net exposure | 678 | 1,085 |
| Impact on profit/(loss) after tax | ||
| US$M | FY24 | FY23 |
Increase of 100 basis points | 5 | 8 |
Decrease of 100 basis points | (5) | (8) |
US$M | FY24 | FY23 |
Australian dollar | (779) | (946) |
Brazilian real | (52) | (103) |
Colombian peso | (8) | (70) |
South African rand | 16 | 74 |
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SOUTH 32 ANNUAL REPORT 2024
19. Financial assets and financial liabilitiescontinued
(b) Financial risk management objectives and policiescontinued
(i) Market risk continued
Foreign currency risk continued
| Impact on profit/(loss) after tax | ||
FY24 | FY23 | |
10% strengthening in Australian dollar | (55) | (67) |
10% strengthening in Brazilian real | (5) | (10) |
10% strengthening in Colombian peso | (1) | (7) |
10% strengthening in South African rand | 2 | 7 |
| FY24 | |||
US$M | Available | Used | Unused |
Revolving credit facility (1) | 1,400 | – | 1,400 |
Notes to financial statements – Capital structure and financing continued
152
SOUTH 32 ANNUAL REPORT 2024
19. Financial assets and financial liabilitiescontinued
(b) Financial risk management objectives and policiescontinued
(ii) Liquidity riskcontinued
| On demand | |||||
| FY24 | Carrying | or less than 1 | More than 5 | ||
| US$M | amount | Total | year | 1 to 5 years | years |
Trade and other payables (1) | 785 | 785 | 784 | 1 | – |
Senior unsecured notes | 692 | 944 | 30 | 122 | 792 |
Lease liabilities | 672 | 1,104 | 111 | 337 | 656 |
Other interest bearing liabilities | 202 | 205 | 165 | 40 | – |
Other financial liabilities - contingent consideration payable | 17 | 22 | – | 22 | – |
Total | 2,368 | 3,060 | 1,090 | 522 | 1,448 |
| On demand | |||||
| FY23 | Carrying | or less than 1 | More than 5 | ||
| US$M | amount | Total | year | 1 to 5 years | years |
Trade and other payables (1) | 986 | 986 | 968 | – | 18 |
Senior unsecured notes | 690 | 974 | 30 | 122 | 822 |
Lease liabilities | 674 | 1,148 | 102 | 331 | 715 |
Other interest bearing liabilities | 377 | 383 | 315 | 68 | – |
Other financial liabilities - contingent consideration payable | 37 | 48 | – | 48 | – |
Total | 2,764 | 3,539 | 1,415 | 569 | 1,555 |
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
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SOUTH 32 ANNUAL REPORT 2024
19. Financial assets and financial liabilitiescontinued
(b) Financial risk management objectives and policiescontinued
(iii) Credit risk continued
Shareholder loan receivable from Sierra Gorda continued
US$M | FY24 | FY23 |
At the beginning of the year | 1,711 | 1,648 |
Interest accrued | 159 | 148 |
Net impairment | (29) | (71) |
Repayment of accrued interest | (27) | (14) |
At the end of the year | 1,814 | 1,711 |
| FY24 | Impact on profit/(loss) after tax | |||
| US$M | Face value | Carrying value | Favourable | Unfavourable |
| Trade and other receivables | ||||
Loans to equity accounted investments | 2,283 | 1,814 | 79 | (129) |
FY24 | FY23 | |||
Shares | US$M | Shares | US$M | |
| Share capital | ||||
At the beginning of the year | 4,545,413,695 | 13,251 | 4,628,431,584 | 13,469 |
Shares bought back and cancelled | (16,155,127) | (35) | (83,017,889) | (218) |
At the end of the year | 4,529,258,568 | 13,216 | 4,545,413,695 | 13,251 |
| Treasury shares | ||||
At the beginning of the year | (17,263,473) | (51) | (11,467,507) | (32) |
Purchase of shares by ESOP Trusts | (4,345,048) | (11) | (11,676,773) | (33) |
Employee share awards vested | 5,921,057 | 19 | 5,880,807 | 14 |
At the end of the year | (15,687,464) | (43) | (17,263,473) | (51) |
Notes to financial statements – Capital structure and financing continued
154
SOUTH 32 ANNUAL REPORT 2024
US$'000 | FY24 | FY23 |
| Fees payable to the Group's auditor for assurance services | ||
Audit and review of financial statements | 4,446 | 4,207 |
Other assurance services (1) | 823 | 705 |
Total auditor’s remuneration | 5,269 | 4,912 |
22. Employee share ownership plans
At 30 June 2024, the Group had the following employee share ownership plans:
Awards granted to lead team members (1) | |
Long-term Incentive Plan (2) | FY21, FY22, FY23, FY24 |
Deferred Short-Term Incentive Plan (3) | FY22, FY23 |
Executive Transitional Award Plan (2) | FY22, FY24 |
Management Share Plan (4) | FY21 |
(1) Awards granted on 4 December 2020, 6 December 2021, 8 December 2022 and 4 December 2023.
(2) Awards subject to performance and service conditions.
(3) Awards subject to service conditions only.
(4) During FY21, Jason Economidis, as acting Chief Operating Officer, participated in the Management Share Plan and not the Long-Term Incentive Plan.
Awards granted to eligible employees (1) | |||
Management Share Plan (2) | FY21, FY22, FY23, FY24 | ||
AllShare Plan (3) | 2021, | 2022, | 2023 |
(1) Awards granted on 4 December 2020, 7 December 2020, 6 May 2021, 6 December 2021, 9 May 2022, 8 December 2022, 15 May 2023, 4 December 2023 and 7 May 2024.
(2) Awards subject to performance and service conditions.
(3) Awards subject to service conditions only.
All awards take the form of rights to receive one share in South32 Limited for each right granted, subject to performance and/or service
conditions being met. Performance conditions include total shareholder return relative to peer groups and, for FY23 and FY24 Long-
Term Incentive Plan and Management Share Plan awards, climate change and portfolio management performance hurdles. Further
information on the vesting conditions of performance rights granted in FY24 is disclosed in the Remuneration Report. A portion of the
2021, 2022 and 2023 AllShare Plan awards (participants located in Colombia and Mozambique) take the form of rights to receive a cash
payment equivalent to the value of South32 Limited shares at the time of payment. Employees in Africa are granted rights on the JSE
and all other employees are granted rights on the ASX.
Awards do not confer any dividend or voting rights until they convert into shares at vesting. In addition, the awards do not confer any
rights to participate in a share issue, however, there is discretion under the plans to adjust the awards in response to a variation in
South32 Limited’s share capital.
The AllShare JSE plan is eligible to receive a payment equal to the dividend amount that would have been earned on the underlying
shares awarded to those participants (Dividend Equivalent Payment). The Dividend Equivalent Payment is made to participants once the
underlying shares are issued or transferred to them. No Dividend Equivalent Payment is made in respect of awards that have lapsed or
have been forfeited. No other awards are eligible for a Dividend Equivalent Payment.
Notes to financial statements – Other notes
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
155
SOUTH 32 ANNUAL REPORT 2024
22. Employee share ownership planscontinued
Notes to financial statements – Other notes continued
156
SOUTH 32 ANNUAL REPORT 2024
22. Employee share ownership planscontinued
| Risk-free | ||||||
| interest rate | ||||||
| Fair value at | Share price at | based on | ||||
| grant date | grant date | Expected | Expected life | government | ||
| FY24 | (US$) | (US$) | volatility (%) | (in years) | bonds (%) | |
| Recurring plans | ||||||
FY24 Long-Term Incentive Plan | 1.03 | 2.08 | 30 | 4 | 4.14 | |
FY23 Deferred Short-Term Incentive Plan | 1.92 | 2.08 | 30 | 2 | 4.36 | |
FY24 Management Share Plan - Retention rights | 1.80 - 1.81 | 2.07 - 2.08 | 30 | 3 | 4.25 - 8.26 | |
FY24 Management Share Plan - Performance rights | 1.03 - 1.04 | 2.07 - 2.08 | 30 | 4 | 4.14 - 8.38 | |
2023 | AllShare Plan | 1.92 - 2.07 | 2.07 - 2.08 | 30 | 3 - 4 | 4.36 - 8.26 |
| Transitional plan | ||||||
FY24 Executive Transitional Award Plan | 0.80 | 2.08 | 30 | 3 | 4.25 |
| Risk-free | ||||||
| interest rate | ||||||
| Fair value at | Share price at | based on | ||||
| grant date | grant date | Expected | Expected life | government | ||
| FY23 | (US$) | (US$) | volatility (%) | (in years) | bonds (%) | |
| Recurring plans | ||||||
FY23 Long-Term Incentive Plan | 1.74 | 2.76 | 35 | 4 | 3.14 | |
FY22 Deferred Short-Term Incentive Plan | 2.68 | 2.76 | 35 | 2 | 3.09 | |
FY23 Management Share Plan - Retention rights | 2.59 - 2.63 | 2.76 - 2.85 | 35 | 3 | 3.12 - 8.32 | |
FY23 Management Share Plan - Performance rights | 1.74 - 1.77 | 2.76 - 2.85 | 35 | 4 | 3.14 - 8.85 | |
2022 | AllShare Plan | 2.68 - 2.90 | 2.76 - 2.85 | 35 | 2 - 3 | 3.09 - 8.32 |
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
157
SOUTH 32 ANNUAL REPORT 2024
22. Employee share ownership planscontinued
(d) Reconciliation of outstanding share awards
None of the awards listed below have an exercise price or are exercisable at 30 June 2024.
| Rights at | Granted | Forfeited | Lapsed | ||||
| FY24 | beginning of | during the | Vested during | during the | during the | Rights at end | |
| Number of rights | the year | year | the year | year | year | of the year | |
| Recurring plans | |||||||
FY20 Long-Term Incentive Plan | 4,333,282 | – | – | – | (4,333,282) | – | |
FY21 Long-Term Incentive Plan | 6,283,436 | – | – | – | – | 6,283,436 | |
FY22 Long-Term Incentive Plan | 3,430,278 | – | – | – | – | 3,430,278 | |
FY23 Long-Term Incentive Plan | 2,494,503 | – | – | – | – | 2,494,503 | |
FY24 Long-Term Incentive Plan | – | 3,129,136 | – | – | – | 3,129,136 | |
FY21 Deferred Short-Term Incentive Plan | 728,990 | – | (728,990) | – | – | – | |
FY22 Deferred Short-Term Incentive Plan | 949,257 | – | – | – | – | 949,257 | |
FY23 Deferred Short-Term Incentive Plan | – | 1,082,738 | – | – | – | 1,082,738 | |
FY20 Management Share Plan - Performance Rights | 4,900,613 | – | – | (19,558) | (4,881,055) | – | |
FY21 Management Share Plan - Retention Rights (1) | 2,481,374 | 12,376 | (2,468,943) | (24,807) | – | – | |
FY21 Management Share Plan - Performance Rights (1) | 6,935,622 | 168,061 | – | (490,803) | – | 6,612,880 | |
FY22 Management Share Plan - Retention Rights (1) | 2,031,578 | 78,771 | (226,952) | (185,816) | – | 1,697,581 | |
FY22 Management Share Plan - Performance Rights (1) | 3,308,316 | 131,867 | – | (364,786) | – | 3,075,397 | |
FY23 Management Share Plan - Retention Rights (1) | 1,829,892 | 53,434 | (59,969) | (182,357) | – | 1,641,000 | |
FY23 Management Share Plan - Performance Rights (1) | 3,072,258 | 89,578 | – | (331,234) | – | 2,830,602 | |
FY24 Management Share Plan - Retention Rights | – | 2,416,246 | (24,117) | (195,834) | – | 2,196,295 | |
FY24 Management Share Plan - Performance Rights | – | 4,050,195 | – | (338,256) | – | 3,711,939 | |
2020 | AllShare Plan (1) | 2,287,200 | 7,200 | (2,276,000) | (18,400) | – | – |
2021 | AllShare Plan (1) | 3,987,720 | 7,420 | (2,423,690) | (78,440) | – | 1,493,010 |
2022 | AllShare Plan (1) | 4,416,880 | 7,800 | (69,680) | (241,800) | – | 4,113,200 |
2023 | AllShare Plan | – | 5,671,200 | (42,600) | (182,400) | – | 5,446,200 |
| Transitional plans | |||||||
FY21 Executive Transitional Award Plan | 154,702 | – | (154,702) | – | – | – | |
FY22 Executive Transitional Award Plan | 195,128 | – | – | – | – | 195,128 | |
FY24 Executive Transitional Award Plan | – | 85,559 | – | – | – | 85,559 | |
FY20 Management Transitional Award Plan | 74,918 | – | – | – | (74,918) | – | |
Total awards | 53,895,947 | 16,991,581 | (8,475,643) | (2,654,491) | (9,289,255) | 50,468,139 |
(1) Retrospective grants related to prior year plans.
US$M | FY24 | FY23 |
Actual or potential litigation | 342 | 519 |
Total contingent liabilities | 342 | 519 |
Actual or potential litigation | 102 | 143 |
Total contingent assets | 102 | 143 |
Notes to financial statements – Other notes continued
158
SOUTH 32 ANNUAL REPORT 2024
| Country of | Effective interest % | |||
| Material subsidiaries | incorporation | Principal activity | FY24 | FY23 |
African Metals (Pty) Ltd | South Africa | Investment holding company | 100 | 100 |
Cerro Matoso S.A. | Colombia | Integrated laterite ferronickel mining and | 99.9 | 99.9 |
| smelting complex | ||||
Dendrobium Coal Pty Ltd (1) | Australia | Metallurgical coal mine | 100 | 100 |
Endeavour Coal Pty Limited (1) | Australia | Metallurgical coal mine | 100 | 100 |
Hillside Aluminium (Pty) Ltd | South Africa | Aluminium smelter | 100 | 100 |
Illawarra Coal Holdings Pty Ltd (1) | Australia | Investment holding company | 100 | 100 |
Illawarra Services Proprietary Limited (1) | Australia | Coal washery, rail and road transportation | 100 | 100 |
South32 Aluminium (Holdings) Pty Ltd | Australia | Investment holding company | 100 | 100 |
South32 Aluminium (RAA) Pty Ltd | Australia | Interest in a joint operation | 100 | 100 |
South32 Aluminium (Worsley) Pty Ltd | Australia | Interest in a joint operation | 100 | 100 |
South32 Cannington Proprietary Limited | Australia | Silver, lead and zinc mine | 100 | 100 |
South32 Eagle Downs Pty Ltd (1) | Australia | Interest in a joint operation | 100 | 100 |
South32 Finance 1 B.V. | Netherlands | Financing company | 100 | 100 |
South32 Finance 2 B.V. | Netherlands | Financing company | 100 | 100 |
South32 Group Operations Pty Ltd | Australia | Administrative, management and support | 100 | 100 |
| services | ||||
South32 Hermosa Inc. | United States | Base metals exploration and development project | 100 | 100 |
South32 Investment 1 B.V. | Netherlands | Interest in a joint operation | 100 | 100 |
South32 Marketing Pte. Ltd. | Singapore | Sales, marketing and distribution | 100 | 100 |
South32 Minerals SA | Brazil | Interest in a joint operation | 100 | 100 |
South32 SA Investments Limited | United Kingdom | Investment holding company | 100 | 100 |
South32 Sierra Gorda SpA | Chile | Investment holding company | 100 | 100 |
South32 Treasury Limited | Australia | Financing company | 100 | 100 |
South32 USA Exploration Inc. | United States | Exploration | 100 | 100 |
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SOUTH 32 ANNUAL REPORT 2024
| Ownership interest % | ||||
Material joint ventures | Country of incorporation | Principal activity | FY24 | FY23 |
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 |
US$M | FY24 | FY23 |
At the beginning of the year | 499 | 470 |
Share of profit/(loss) (1) | (60) | 246 |
Share of other comprehensive income | – | 6 |
Dividends received | (90) | (223) |
Investments | 53 | – |
Reclassified as held for sale (2) | (6) | – |
At the end of the year | 396 | 499 |
| Carrying amount of equity accounted investments | ||
US$M | FY24 | FY23 |
Australia Manganese | 29 | 95 |
South Africa Manganese | 189 | 173 |
Manganese Marketing | 64 | 72 |
Sierra Gorda | 94 | 101 |
Individually immaterial (1) | 20 | 58 |
Total | 396 | 499 |
| Share of profit/(loss) of equity accounted investments | FY23 | |
US$M | FY24 | Restated (1) |
Australia Manganese | (44) | 120 |
South Africa Manganese | 15 | 36 |
Manganese Marketing | 6 | 8 |
Sierra Gorda | (6) | 71 |
Individually immaterial (2) | (30) | 6 |
Total | (59) | 241 |
Notes to financial statements – Other notes continued
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SOUTH 32 ANNUAL REPORT 2024
25. Equity accounted investmentscontinued
| Joint ventures | ||||
| FY24 | Australia | South Africa | Manganese | |
| US$M | Manganese (1) | Manganese (1) | Marketing | Sierra Gorda |
| Reconciliation of the carrying amount of equity accounted investments | ||||
Current assets | 271 | 255 | 125 | 584 |
Non-current assets | 792 | 567 | 67 | 4,688 |
Current liabilities | (118) | (129) | (86) | (769) |
Non-current liabilities | (897) | (268) | – | (4,295) |
Net assets - 100% | 48 | 425 | 106 | 208 |
Net assets - the Group's share | 29 | 189 | 64 | 94 |
Carrying amount of equity accounted investments | 29 | 189 | 64 | 94 |
| Reconciliation of share of profit/(loss) of equity accounted investments | ||||
Revenue - 100% | 649 | 515 | 1,318 | 1,438 |
Profit/(loss) after tax - 100% | (73) | 27 | 10 | (13) |
Profit/(loss) after tax - the Group's share | (44) | 15 | 6 | (6) |
Share of profit/(loss) of equity accounted investments | (44) | 15 | 6 | (6) |
| Other balances of equity accounted investments presented on a 100% basis | ||||
Cash and cash equivalents (2) | – | 43 | – | 160 |
Current financial liabilities (excluding trade and other payables and provisions) | (9) | (29) | – | (426) |
Non-current financial liabilities (excluding trade and other payables and provisions) | (290) | (9) | – | (4,156) |
Depreciation and amortisation | (195) | (32) | (5) | (294) |
Interest income | 5 | 5 | 5 | 6 |
Interest expense | (58) | (36) | – | (421) |
Income tax (expense)/benefit (excluding royalty related tax) | 6 | (14) | (3) | 1 |
Royalty related tax (expense)/benefit | (19) | – | – | (19) |
| Joint ventures | ||||
| FY23 | Australia | South Africa | Manganese | |
| US$M | Manganese (1) | Manganese (1) | Marketing | Sierra Gorda |
| Reconciliation of the carrying amount of equity accounted investments | ||||
Current assets | 351 | 231 | 187 | 590 |
Non-current assets | 837 | 514 | 75 | 4,437 |
Current liabilities | (235) | (94) | (141) | (322) |
Non-current liabilities | (794) | (255) | – | (4,481) |
Net assets - 100% | 159 | 396 | 121 | 224 |
Net assets - the Group's share | 95 | 173 | 72 | 101 |
Carrying amount of equity accounted investments | 95 | 173 | 72 | 101 |
| Reconciliation of share of profit/(loss) of equity accounted investments | ||||
Revenue - 100% | 1,028 | 512 | 1,706 | 1,521 |
Profit/(loss) after tax - 100% | 200 | 64 | 13 | 158 |
Profit/(loss) after tax - the Group's share | 120 | 36 | 8 | 71 |
Share of profit/(loss) of equity accounted investments | 120 | 36 | 8 | 71 |
| Other balances of equity accounted investments presented on a 100% basis | ||||
Cash and cash equivalents (2) | – | 32 | – | 180 |
Current financial liabilities (excluding trade and other payables and provisions) | (9) | – | – | (23) |
Non-current financial liabilities (excluding trade and other payables and provisions) | (263) | (8) | – | (4,331) |
Depreciation and amortisation | (167) | (32) | (5) | (314) |
Interest income | 4 | 9 | 4 | 3 |
Interest expense | (39) | (11) | – | (385) |
Income tax (expense)/benefit (excluding royalty related tax) | (127) | (37) | (3) | (62) |
Royalty related tax (expense)/benefit | (72) | – | – | (27) |
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SOUTH 32 ANNUAL REPORT 2024
| Material joint | Country of | Effective Interest % | ||
| operations | operation | Principal activity | FY24 | FY23 |
Ambler Metals | United States | Base metals exploration and development options | 50 | 50 |
Brazil Alumina | Brazil | Integrated bauxite mine and alumina refinery | 36 | 36 |
Brazil Aluminium | Brazil | Aluminium smelter | 40 | 40 |
Eagle Downs Metallurgical Coal (1) | Australia | Metallurgical coal exploration and development option | 50 | 50 |
Mozal Aluminium (2) | Mozambique | Aluminium smelter | 63.7 | 63.7 |
Worsley Alumina (2) | Australia | Integrated bauxite mine and alumina refinery | 86 | 86 |
27. Key management personnel
(a) Key management personnel compensation
US$’000 | FY24 | FY23 |
Short-term employee benefits | 6,460 | 5,419 |
Post-employment benefits | 146 | 128 |
Other long-term benefits | 277 | 276 |
Share-based payments | 4,087 | 4,246 |
Total | 10,970 | 10,069 |
(b) Transactions with key management personnel
There were no transactions with key management personnel during the year ended 30 June 2024 (FY23: US$nil).
(c) Loans to key management personnel
There were no loans with any key management personnel as at 30 June 2024 (FY23: US$nil).
(d) Transactions with key management personnel related entities
There were no transactions with entities controlled or jointly controlled by key management personnel and there were no outstanding
amounts with those entities as at 30 June 2024 (FY23: US$nil).
Notes to financial statements – Other notes continued
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SOUTH 32 ANNUAL REPORT 2024
| Transactions with related parties | Joint ventures | Associates (1) | ||
| US$’000 | FY24 | FY23 | FY24 | FY23 |
Sales of goods and services | 228,277 | 271,141 | 4,294 | 3,863 |
Purchases of goods and services (2) | 50,873 | 531 | 189,348 | 163,096 |
Interest income | 178,435 | 160,288 | – | – |
Dividend income | 90,000 | 223,468 | – | – |
Interest expense | 12,022 | 14,977 | – | – |
Increase/(decrease) in short-term financing arrangements | (177,478) | (47,726) | – | – |
Increase/(decrease) in loans with related parties | 114,482 | 113,587 | (6,838) | (9,117) |
| Outstanding balances with related parties | Joint ventures | Associates (1) | ||
| US$’000 | FY24 | FY23 | FY24 | FY23 |
Trade and sundry amounts owing to related parties (2) | 52,776 | 928 | 28,939 | 18,393 |
Other amounts owing to related parties (3) | 137,891 | 286,804 | – | – |
Other amounts owing from related parties (4) | 28,565 | – | – | – |
Trade and sundry amounts owing from related parties | 29,127 | 29,993 | 380 | 312 |
Loan amounts owing from related parties (5)(6)(7) | 1,978,235 | 1,863,753 | 33,464 | 40,302 |
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SOUTH 32 ANNUAL REPORT 2024
29. Parent entity information
(a) Summary financial information
The individual financial statements for the parent entity, South32 Limited, show the following aggregate amounts:
US$M | FY24 | FY23 |
| Result of parent entity | ||
Profit/(loss) after tax for the year | (163) | (995) |
Total comprehensive income/(loss) | (163) | (995) |
| Financial position of parent entity at year end | ||
Current assets | 375 | 445 |
Current liabilities | (402) | (1,375) |
Total assets | 12,303 | 12,056 |
Total liabilities | (1,982) | (1,383) |
Net assets | 10,321 | 10,673 |
| Total equity of the parent entity | ||
Share capital | 13,216 | 13,251 |
Treasury shares | (39) | (47) |
Other reserves | 38 | 32 |
Profit reserve (1) | 3,653 | 3,816 |
Accumulated losses | (6,547) | (6,379) |
Total equity | 10,321 | 10,673 |
(1) Prior year profits, net of dividends paid, have been appropriated to a profit reserve for future dividend payments.
(b) Parent company guarantees
The parent entity and South32 SA Investments Ltd have jointly and severally, fully and unconditionally guaranteed the payment of the
principal and premium, if any, and interest, including certain additional amounts that may be payable in respect of the US$700 million
of unsecured notes issued by South32 Treasury Ltd, a 100 per cent owned finance subsidiary of the parent entity, refer to note 17
Interest bearing liabilities. The parent entity and South32 SA Investments Ltd have guaranteed the payment of such amounts when they
become due and payable, whether on an interest payment date, at the stated maturity of the notes, by declaration or acceleration, call
for redemption or otherwise.
The parent entity has also guaranteed a US commercial paper program and a Group revolving credit facility of US$1,400 million. Both
the US commercial paper program and the revolving credit facility are undrawn as at 30 June 2024, refer to note 19 Financial assets and
financial liabilities for further details.
The parent entity is party to a Deed of Support with the effect that the Company guarantees debts in respect of South32 Group
Operations Pty Ltd.
Notes to financial statements – Other notes continued
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SOUTH 32 ANNUAL REPORT 2024
US$M | FY24 |
| Assets held for sale | |
Illawarra Metallurgical Coal | 1,794 |
Eagle Downs Metallurgical Coal | 31 |
Total assets held for sale | 1,825 |
| Liabilities directly associated with assets held for sale | |
Illawarra Metallurgical Coal | 558 |
Eagle Downs Metallurgical Coal | 15 |
Total liabilities directly associated with assets held for sale | 573 |
US$M | FY24 | FY23 |
| Revenue: | ||
Group production | 1,224 | 1,643 |
Third party products and services | 237 | 140 |
1,461 | 1,783 | |
Other income | 10 | 2 |
Expenses excluding finance costs | (832) | (1,126) |
Share of profit/(loss) of equity accounted investments | (1) | 5 |
Profit/(loss) from a discontinued operation | 638 | 664 |
Finance income | 2 | 2 |
Finance costs | (12) | (9) |
Net finance income/(costs) | (10) | (7) |
Profit/(loss) before tax from a discontinued operation | 628 | 657 |
Income tax (expense)/benefit | (193) | (212) |
Profit/(loss) for the year from a discontinued operation | 435 | 445 |
Total comprehensive income/(loss) from a discontinued operation attributable to the equity holders of South32 Limited | 435 | 445 |
Basic earnings/(loss) per share (cents) | 9.6 | 9.7 |
Diluted earnings/(loss) per share (cents) | 9.6 | 9.7 |
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Notes to financial statements – Other notes continued
30. Assets and liabilities held for sale and discontinued operationscontinued
Illawarra Metallurgical Coal continued
US$M | FY24 | FY23 |
Net cash flows from operating activities | 358 | 654 |
Net cash flows from investment activities | (345) | (257) |
Net cash flows from financing activities | (5) | (6) |
US$M | FY24 |
| Assets | |
Trade and other receivables | 164 |
Inventories | 109 |
Property, plant and equipment | 1,502 |
Equity accounted investments | 6 |
Other assets | 13 |
Total assets held for sale | 1,794 |
| Liabilities | |
Trade and other payables | 249 |
Interest bearing liabilities | 30 |
Provisions | 268 |
Deferred tax liabilities | 11 |
Total liabilities directly associated with assets held for sale | 558 |
Net assets of disposal group classified as held for sale | 1,236 |
US$M | FY24 |
| Assets | |
Property, plant and equipment | 31 |
Total assets held for sale | 31 |
| Liabilities | |
Interest bearing liabilities | 8 |
Provisions | 7 |
Total liabilities directly associated with assets held for sale | 15 |
Net assets of disposal group classified as held for sale | 16 |
166
SOUTH 32 ANNUAL REPORT 2024
31. Subsequent events
Capital management
On 29 August 2024, the Directors resolved to pay a fully-franked final dividend of US 3.1 cents per share (US$140 million) in respect of
the 2024 financial year. The dividends will be paid on 17 October 2024. The dividends have not been provided for in the consolidated
financial statements and will be recognised in the 2025 financial year.
On 29 August 2024, the Directors resolved to allocate US$200 million to its on-market share buy-back program, commencing from the
completion of the sale of Illawarra Metallurgical Coal and to be returned to shareholders by 12 September 2025.
No other matters or circumstances have arisen since the end of the year that have significantly affected, or may significantly affect, the
operations, results of operations or state of affairs of the Group in subsequent accounting periods.
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SOUTH 32 ANNUAL REPORT 2024
The following table provides a list of all entities included in the Group's consolidated financial statements, prepared in accordance with
the requirements of Section 295(3A) of the Corporations Act. The ownership interest is only disclosed for those entities which are a body
corporate, representing the direct and indirect percentage share capital owned by the Company.
Entity name Legal structure Country of incorporation
Country of tax
residency
Ownership
interest %
(1)
African Metals (Pty) Ltd Body Corporate South Africa South Africa 100
Aluminium Beneficiation Initiative (NPC) Body Corporate South Africa South Africa 50
Aluminium Management Company of Mozambique (Pty)
Limited
Body Corporate South Africa South Africa 66
Ambler Metals LLC Body Corporate United States United States 50
Bare Trusts
(2)
Trust N/A Australia N/A
BHP Billiton Aluminium South Africa Trust Trust N/A South Africa N/A
BHP Billiton Community Development Trust Trust N/A South Africa N/A
BHP Billiton Community Support Trust Trust N/A South Africa N/A
BHP Billiton Education Trust Trust N/A South Africa N/A
Billiton Insurance Mutual Trust Trust N/A South Africa N/A
Cerro Matoso S.A. Body Corporate Colombia Colombia 99.9
Conicol BVI Limited Body Corporate British Virgin Islands Australia 100
Dendrobium Coal Pty Ltd Body Corporate Australia Australia 100
Dendrobium Community Enhancement Program Trust N/A Australia N/A
Dendrobium Community Enhancement Program Pty
Ltd
(3)
Body Corporate Australia Australia 100
Eagle Downs Coal Management Pty Ltd Body Corporate Australia Australia 100
Endeavour Coal Pty Limited Body Corporate Australia Australia 100
Fundación cerro matoso Body Corporate Colombia Colombia 100
Fundación educativa de montelíbano Body Corporate Colombia Colombia 100
Fundación panzenú Body Corporate Colombia Colombia 100
Gengro (Pty) Ltd Body Corporate South Africa South Africa 100
Hillside Aluminium (Pty) Ltd Body Corporate South Africa South Africa 100
Illawarra Coal Community Partnerships Program Trust N/A Australia N/A
Illawarra Coal Community Partnerships Programme Pty
Limited
(3)
Body Corporate Australia Australia 100
Illawarra Coal Holdings Pty Ltd Body Corporate Australia Australia 100
Illawarra Services Proprietary Limited Body Corporate Australia Australia 100
Micawber 501 (Proprietary) Limited Body Corporate South Africa South Africa 100
Minera Sud Argentina S.A. Body Corporate Argentina Argentina 50.1
Mozal Community Development Trust Trust N/A Mozambique N/A
Mozal SA Body Corporate Mozambique Mozambique 63.7
South32 (BMSA) Pty Ltd Body Corporate Australia Australia 100
South32 (BVI) Limited Body Corporate British Virgin Islands Australia 100
South32 Africa (Pty) Ltd Body Corporate South Africa South Africa 100
South32 Aluminium (Holdings) Pty Ltd Body Corporate Australia Australia 100
South32 Aluminium (RAA) Pty Ltd
(4)
Body Corporate Australia Australia 100
South32 Aluminium (Worsley) Pty Ltd
(4)
Body Corporate Australia Australia 100
South32 Aluminium SA (Pty) Ltd Body Corporate South Africa South Africa 100
South32 Americas Inc. Body Corporate United States United States 100
South32 Argentina Holdings Pty Ltd Body Corporate Australia Australia 100
South32 Arizona (Holdings) Pty Ltd Body Corporate Australia Australia 100
South32 Australia Investment 3 Pty Ltd Body Corporate Australia Australia 100
South32 Base Metals Ireland Limited Body Corporate Ireland Ireland 100
South32 Canada Inc. Body Corporate Canada Canada 100
South32 Cannington Proprietary Limited Body Corporate Australia Australia 100
South32 Chile Copper Holdings Pty Ltd Body Corporate Australia Australia 100
South32 Eagle Downs Pty Ltd Body Corporate Australia Australia 100
South32 Energy SAS ESP Body Corporate Colombia Colombia 100
South32 Exploracion S.A.S. Body Corporate Colombia Colombia 100
Consolidated entity disclosure statement
as at 30 June 2024
168
SOUTH 32 ANNUAL REPORT 2024
Entity name Legal structure Country of incorporation
Country of tax
residency
Ownership
interest %
(1)
South32 Finance 1 B.V. Body Corporate Netherlands Netherlands 100
South32 Finance 2 B.V. Body Corporate Netherlands Netherlands 100
South32 Finance South Africa Limited Body Corporate British Virgin Islands United Kingdom 100
South32 Freight Australia Pty Ltd Body Corporate Australia Australia 100
South32 Gas S.A.S. E.S.P. Body Corporate Colombia Colombia 100
South32 Group (BVI) Limited Body Corporate British Virgin Islands Australia 100
South32 Group Operations Pty Ltd Body Corporate Australia Australia 100
South32 Hermosa Inc. Body Corporate United States United States 100
South32 Holding 1 SpA Body Corporate Chile Chile 100
South32 Holding 2 SpA Body Corporate Chile Chile 100
South32 International Investment Holdings Proprietary
Limited
Body Corporate Australia Australia 100
South32 International Investment Proprietary Limited Body Corporate Australia Australia 100
South32 Investment 1 B.V.
(5)
Body Corporate Netherlands Netherlands 100
South32 Jersey Limited Body Corporate Jersey Australia 100
South32 Limited Body Corporate Australia Australia 100
South32 Limited Employee Incentive Plans Trust Trust N/A Australia N/A
South32 Marketing Pte. Ltd. Body Corporate Singapore Singapore 100
South32 Minerals SA Body Corporate Brazil Brazil 100
South32 North America Projects ULC Body Corporate Canada Canada 100
South32 Properties (Pty) Ltd Body Corporate South Africa South Africa 100
South32 Royalty Investments Pty Ltd Body Corporate Australia Australia 100
South32 SA Finance (Pty) Ltd Body Corporate South Africa South Africa 100
South32 SA Holdings Ltd Body Corporate South Africa South Africa 100
South32 SA Investments Limited Body Corporate United Kingdom United Kingdom 100
South32 SA Ltd Body Corporate South Africa South Africa 100
South32 SA Manganese Holdings (Pty) Ltd Body Corporate South Africa South Africa 100
South32 Sierra Gorda SpA Body Corporate Chile Chile 100
South32 South African AllShare Trust Trust N/A South Africa N/A
South32 Sweden Exploration AB Body Corporate Sweden Sweden 100
South32 Treasury (USA) Limited Body Corporate Australia Australia 100
South32 Treasury Limited Body Corporate Australia Australia 100
South32 USA Exploration Inc.
(6)
Body Corporate United States United States 100
South32 Worsley Alumina Pty Ltd Body Corporate Australia Australia 86
Southern Abatis Pte Ltd Body Corporate Singapore Australia 100
Taragon Valley Pty Limited Body Corporate Australia Australia 100
(1) The ownership interest percentage has been rounded to one decimal place.
(2) Bare trusts represent a series of trust deeds that were established to hold assets on behalf of a subsidiary within the Group.
(3) Trustee of a trust which is consolidated in the consolidated financial statements.
(4) Participant in the South32 Worsley Alumina Pty Ltd joint operation which is included in the consolidated financial statements.
(5) Participant in the Mozal SA and Aluminium Management Company of Mozambique (Pty) Limited joint operations which are included in the consolidated financial statements.
(6) Participant in the Ambler Metals LLC joint operation which is included in the consolidated financial statements.
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SOUTH 32 ANNUAL REPORT 2024
Directors’ declaration
In accordance with a resolution of the Directors of the Company, we state that:
1. In the opinion of the Directors:
(a) The consolidated financial statements and notes that are set out on pages 110 to 167 of the Annual Report are in accordance
with the Corporations Act, including:
(i) Giving a true and fair view of the Group’s financial position as at 30June 2024 and of its performance for the year ended on
that date; and
(ii) Complying with Australian Accounting Standards and Corporations Regulations 2001.
(b) The consolidated entity disclosure statement set out on pages 168 to 169 of the Annual Report, as required by Section 295(3A)
of the Corporations Act, is true and correct.
(c) There are reasonable grounds to believe that the Company will be able to pay its debts as and when they become due and
payable.
4. The Directors have been given the declarations required by Section 295A of the Corporations Act from the Chief Executive Officer
and Chief Financial Officer for the year ended 30June 2024.
5. The Directors draw attention to note 2 to the financial statements on page 115which includes a statement of compliance with
International Financial Reporting Standards Accounting Standards.
Signed in accordance with a resolution of the Board of Directors.
Karen Wood
Chair
Graham Kerr
Chief Executive Officer and Managing Director
Dated 29August 2024
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SOUTH 32 ANNUAL REPORT 2024
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.
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 audit of South32 Limited for the financial year ended
30 June 2024 there have been:
i. no contraventions of the auditor independence requirements as set out in the Corporations Act 2001 in relation to the audit; and
ii. no contraventions of any applicable code of professional conduct in relation to the audit.
KPMG Graham Hogg
Partner
Perth
29 August 2024
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SOUTH 32 ANNUAL REPORT 2024
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 report
To the shareholders of South32 Limited
Report on the audit of the Financial Report
Opinion
We have audited the Financial Report of South32 Limited (the
Company).
In our opinion, the accompanying Financial Report of the Company
gives a true and fair view, including of the Group’s financial position
as at 30 June 2024 and of its financial performance for the year then
ended, in accordance with the Corporations Act 2001, in compliance
with Australian Accounting Standards and the Corporations
Regulations 2001.
The Financial Report comprises:
• Consolidated balance sheet as at 30 June 2024;
• Consolidated income statement, Consolidated statement of
comprehensive income, Consolidated statement of changes in
equity, and Consolidated cash flow statement for the year then
ended;
• Consolidated entity disclosure statement and accompanying basis
of preparation as at 30 June 2024;
• Notes, including material accounting policies; and
• Directors’ Declaration.
The Group consists of the Company and the entities it controlled at
the year end or from time to time during the financial year.
Basis for opinion
We conducted our audit in accordance with Australian Auditing Standards and International Standards on Auditing. We believe that the
audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit of the Financial Report
section of our report.
We are independent of the Group in accordance with the Corporations Act 2001 and the ethical requirements of the Accounting
Professional and Ethical Standards Board’s APES 110 Code of Ethics for Professional Accountants (including Independence Standards) (the
Code) that are relevant to our audit of the Financial Report in Australia. We have fulfilled our other ethical responsibilities in accordance with
these requirements.
Key Audit Matters
The Key Audit Matters we identified are:
• Asset valuation;
• Closure and rehabilitation provision; and
• Sale of Illawarra Metallurgical Coal.
Key Audit Matters are those matters that, in our professional
judgement, were of most significance in our audit of the Financial
Report of the current period.
These matters were addressed in the context of our audit of the
Financial Report as a whole, and in forming our opinion thereon, and
we do not provide a separate opinion on these matters.
172
SOUTH 32 ANNUAL REPORT 2024
Independent Auditor’s Report
Asset valuation (Property, plant & equipment US$6,503m, Intangible assets US$221m, Equity accounted
investments US$396m, and Net impairment of non-financial assets from continuing operations US$801m)
Refer to Note 13 Impairment of non-financial assets and Note 5 Expenses excluding finance costs to the Financial Report
The key audit matter How the matter was addressed in our audit
The assessment of the existence of impairment or reversal indicators
and the Group’s impairment testing of Cash Generating Units (CGU)
and Areas of Interest (AOI), where required, was a key audit matter. This
is due to the size of property, plant and equipment, intangible assets
and equity accounted investments, and the sensitivity of valuations to
certain assumptions.
The Group had previously impaired the carrying value of several CGUs
to equate to their recoverable amount, as required by accounting
standards. Combined with the volatility in both commodity and foreign
exchange markets, this increases the sensitivity of the current carrying
values of these CGUs to potential impairment or reversal.
The Group has recorded an impairment charge of $554m (pre-tax) in
the Worsley Alumina CGU and of $264m (pre-tax) in the Cerro Matoso
CGU resulting from identification of an impairment indicator.
This further increased our audit effort in this key audit area.
The Group uses discounted cash flow (DCF) models to perform their
assessment of impairment or reversal indicators and fair value less
cost of disposal for impairment testing, where required.
The Group’s models use life of operation and project plans, approved
budgets, and a range of external sources as inputs to the assumptions.
Modelling using forward-looking assumptions tends to be prone to
greater risk for potential bias, error and inconsistent application. These
conditions necessitate additional scrutiny by us to address the
objectivity of inputs and their consistent application.
We focused on the significant forward-looking assumptions the Group
applied in their models, including:
• Forecast commodity prices and foreign exchange rates – the
current economic climate has resulted in significant volatility in
forecast commodity prices across the Group. The Group’s models
are sensitive to small changes in these price assumptions, as well
as changes to foreign exchange rates.
• Forecast operating cash flows, production volumes, capital
expenditure and reserve and resource estimates – these are
determined by the Group based on historical performance
adjusted for expected changes or plans for development,
including consideration of regulatory approvals. This drives
additional audit effort specific to the feasibility of the forecasts
and consistency with the Group’s strategy.
• Discount rates – these are complicated in nature and vary
according to the conditions and environment the CGUs are subject
to from time to time.
• Carbon price – the Group incorporates carbon price assumptions
in its modelling based on enacted local schemes and assumptions
of longer-term pricing and timing in the jurisdictions they operate
and transact in.
We involved valuation specialists to supplement our senior audit team
members in assessing this key audit matter.
Our procedures included:
• We considered the appropriateness of the fair value less cost
of disposal method applied by the Group to perform the annual
test for impairment against the requirements of the accounting
standards.
• On a sample basis, we assessed the integrity and consistency
of the models used for impairment testing and assessment of
impairment or reversal indicators, including the accuracy of the
underlying formulas and consistency of modelling to the prior year.
• We assessed the Group’s view of the indicators leading to
impairment testing for the Worsley Alumina and Cerro Matoso
CGUs. We recalculated the impairment charge and compared to
the amounts recognised.
• We compared the forecast operating cash flows, production
volumes, capital expenditure and reserve and resource estimates
contained in the models to the life of operation plans incorporated
in the approved budgets and study estimates incorporated in
project plans. We assessed the accuracy of the Group’s previous
forecasts to assist with this assessment.
• We considered the sensitivity of the models by varying key
assumptions, such as forecast commodity prices, foreign
exchange rates, costs of production and discount rates, within
a reasonably possible range. We did this to identify those CGUs
at higher risk of impairment or reversal and to focus our further
procedures.
• We assessed the scope, objectivity, and competence of the
Group’s internal experts responsible for preparation of key
resource and reserve estimates and compared these estimates to
those incorporated in the life of operation and project plans where
applicable.
• We assessed the preparation of key resource and reserve
estimates against key requirements of the JORC code, including
testing controls over the appointment of Competent Person and
assessed declarations made.
• We challenged the Group’s significant forecast operating cash
flow, capital expenditure and production volume assumptions.
We compared key events to the Board approved plan and
strategy. We applied increased scepticism to forecasts in the
areas where previous forecasts were not achieved. We compared
key forecast expenditure to published studies of industry
trends and expectations and considered differences for the
Group’s operations. We used our knowledge of the Group, their
past performance, business and customers, and our industry
experience.
• Working with our valuation specialists, and considering the risk
factors specific to the Group, we compared the discount rates to
publicly available market data. We also compared forecast foreign
exchange rates to published views of market commentators.
• Working with our valuation specialists, and considering the risk
factors specific to the Group, we compared forecast commodity
prices to published views of market commentators on future
trends.
• We involved our sustainability specialists and inquired of key
members of the Group’s climate team on their progress of
climate-related strategy. We compared those areas identified by
the Group having an impact on asset valuation to our knowledge
of their industry and business. We tested key climate-related
assumptions incorporated into the financial modelling of carbon
pricing assumptions against locally enacted country specific
schemes and longer term published industry views.
• We assessed the disclosures in the Financial Report using
our understanding obtained from our testing and against the
requirements of the accounting standards.
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SOUTH 32 ANNUAL REPORT 2024
Independent Auditor’s Report
Closure and rehabilitation provision (US$1,938m)
Refer to Note 15 Provisions to the Financial Report.
The key audit matter How the matter was addressed in our audit
Closure and rehabilitation provisioning was a key audit matter due
to the size of the provision and the judgement involved in
determining the provision estimates across multiple sites the Group
operates.
Closure and rehabilitation activities are governed by Group policies
based on legal and regulatory requirements, which differ across the
multiple jurisdictions.
We focused on the following assumptions the Group applied in
determining the provisions using their closure and rehabilitation
plans:
• Nature and extent of activities required at sites, including the
magnitude of disturbance and possible contamination, which are
inherently challenging to assess.
• Timing of when closure and rehabilitation will take place, which
increases estimation uncertainty given the unique nature of each
site and long timeframes involved.
• Forecast cost estimates incorporating historical experience, which
may not be a reliable predictor of such costs particularly in an
inflationary economy, and risk adjustments. The Group engages
external experts periodically to assist in their determination of
these estimates.
• Economic assumptions, including country specific discount rates,
which are complicated in nature.
Our procedures included:
• We compared the basis for recognition and measurement of
the closure and rehabilitation provision for consistency with
environmental and regulatory requirements and criteria in the
accounting standards.
• We evaluated the methodology applied by the Company’s expert
in determining the nature and extent of closure and rehabilitation
activities by comparison to industry practice.
• We evaluated key assumptions used in the closure and
rehabilitation provision, relevant to the jurisdictions of the sites the
Group operates, by:
– Comparing the nature and extent of activities costed to a
sample of the Group’s closure and rehabilitation plans and
relevant regulatory requirements.
– Comparing the timing of closure and rehabilitation activities
to the Group’s resources and reserve estimates and the
expected production profile contained in the life of operation
plans.
– Assessing the scope, objectivity and competence of the
Group’s internal and external experts to provide closure and
rehabilitation cost estimates.
– Comparing a sample of cost estimates of the activities,
incorporating allowance for uncertainties, to historical
experience and underlying documentation, the Group’s
external expert estimates, and our knowledge of the Group
and its industry.
– Working with our valuation specialists, comparing country
specific discount rate assumptions to market observable
data, including risk free rates.
• We assessed the disclosures in the Financial Report using our
understanding obtained from our testing against the requirements
of the accounting standard.
174
SOUTH 32 ANNUAL REPORT 2024
Independent Auditor’s Report
Sale of Illawarra Metallurgical Coal (US$1,794m assets and US$558m liabilities and Impairment reversal
of non-financial assets from discontinued operations US$197m)
Refer to Note 30 Assets and liabilities held for sale and a discontinued operation to the Financial Report and Note 13 Impairment of
non-financial assets
The key audit matter How the matter was addressed in our audit
In February 2024, the Group announced an agreement to sell its
shareholding in Illawarra Metallurgical Coal (IMC).
Several regulatory and third-party approvals needed to be satisfied
prior to completion of the sale. As at balance date these had yet to
be satisfied.
The financial results of IMC are presented as a discontinued
operation and its assets and liabilities are presented as held for sale
in the Financial Report.
The sale is considered a key audit matter due to the:
• Financial significance of IMC to the Group.
• Judgement applied by the Group in the identification of the
disposal group held for sale and the presentation of its results as a
discontinued operation.
• Judgement involved in determining the impairment reversal
recognised related to the cash generating unit.
• Judgement to determine the value of the deferred and contingent
consideration.
Our procedures included:
• We examined the relevant transaction documents to understand
the terms and conditions of the sale.
• We obtained an understanding of the process for identifying net
assets expected to be disposed of. This included walk-through
of the process with the Group’s respective business and finance
teams to check our understanding of the approach and procedures
adopted.
• We assessed the Group’s classification of assets and liabilities
recognised as Assets Held for Sale by reconciling balances
to underlying records, inspecting required adjustments as
stipulated within the share sale agreement and comparing to the
requirements of the accounting standards.
• We assessed the Group’s view of the transaction as an indicator
leading to impairment reversal testing for the IMC CGU. We
recalculated the impairment reversal charge and compared to the
amounts recognised.
• We tested key inputs and forward-looking assumptions used in
the determination of the fair value of the deferred and contingent
consideration to management’s production plan and forecast
commodity prices to published views of market commentators.
• Using our tax specialists, we evaluated the associated tax
implications against the requirements of the tax legislation.
• We assessed the integrity and accuracy of the calculated profit
from the discontinued operation, including impairment reversal of
non-financial assets, against the amount recorded and disclosed by
the Group.
• We assessed the disclosures in the Financial Report using our
understanding obtained from our testing against the requirements
of the accounting standard.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
175
SOUTH 32 ANNUAL REPORT 2024
Independent Auditor’s Report
Other Information
Other Information is financial and non-financial information in South32’s annual report which is provided in addition to the Financial Report
and the Auditor’s Report. The Directors are responsible for the Other Information.
Our opinion on the Financial Report does not cover the Other Information and, accordingly, we do not express an audit opinion or any form of
assurance conclusion thereon, with the exception of the Remuneration Report and our related assurance opinion.
In connection with our audit of the Financial Report, our responsibility is to read the Other Information. In doing so, we consider whether the
Other Information is materially inconsistent with the Financial Report or our knowledge obtained in the audit, or otherwise appears to be
materially misstated.
We are required to report if we conclude that there is a material misstatement of this Other Information, and based on the work we have
performed on the Other Information that we obtained prior to the date of this Auditor’s Report we have nothing to report.
Responsibilities of the Directors for the Financial Report
The Directors are responsible for:
• Preparing the Financial Report in accordance with the Corporations Act 2001, including giving a true and fair view of the financial position and
performance of the Group, and in compliance with Australian Accounting Standards and the Corporations Regulations 2001;
• Implementing necessary internal control to enable the preparation of a Financial Report in accordance with the Corporations Act 2001,
including giving a true and fair view of the financial position and performance of the Group, and that is free from material misstatement,
whether due to fraud or error; and
• Assessing the Group and Company’s ability to continue as a going concern and whether the use of the going concern basis of accounting is
appropriate. This includes disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless
they either intend to liquidate the Group and Company or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the Financial Report
Our objective is:
• To obtain reasonable assurance about whether the Financial Report as a whole is free from material misstatement, whether due to fraud or
error; and
• To issue an Auditor’s Report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with Australian Auditing
Standards and International Standards on Auditing will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error. They are considered material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the basis of the Financial Report.
A further description of our responsibilities for the audit of the Financial Report is located at the Auditing and Assurance Standards Board
website at: https://www.auasb.gov.au/admin/file/content102/c3/ar1_2020.pdf. This description forms part of our Auditor’s Report. These
responsibilities also apply to our audit performed in accordance with International Standards on Auditing.
Report on the Remuneration Report
Opinion
In our opinion, the Remuneration report of South32 Limited for the
year ended 30 June 2024, complies with Section 300A of the
Corporations Act 2001.
Directors’ responsibilities
The Directors of the Company are responsible for the preparation and
presentation of the Remuneration report in accordance with Section
300A of the Corporations Act 2001.
Our responsibilities
We have audited the Remuneration Report included in pages 87 to 108
of the Directors’ report for the year ended 30 June 2024.
Our responsibility is to express an opinion on the Remuneration report,
based on our audit conducted in accordance with Australian Auditing
Standards.
KPMG Graham Hogg
Partner
Perth
29 August 2024
176
SOUTH 32 ANNUAL REPORT 2024
As required by Chapter 5 of the
Australian Securities Exchange (ASX)
Listing Rules, we report Mineral
Resources and Ore Reserves (including
Coal Resources and Coal Reserves) in
accordance with the 2012 Edition of
the Australasian Code for Reporting of
Exploration Results, Mineral Resources
and Ore Reserves (JORC Code).
In this report, information relating to
Mineral Resources and Ore Reserves
is based on, and fairly represents,
information and supporting
documentation prepared by our
Competent Persons listed on page 179.
A Competent Person is defined in the
JORC Code. They must have a minimum
of five years of relevant experience in the
style of mineralisation or type of deposit
under consideration and the activity
being undertaken. Each of our Competent
Persons involved in the preparation of
information relating to Mineral Resources
and Ore Reserves in this report meet
those requirements.
Each of our Competent Persons have
given consent to the inclusion of the
information relating to Mineral Resources
and Ore Reserves in this report in the
form and context in which it appears and
have approved the inclusion of the Mineral
Resources and Ore Reserves statement
as a whole in this report. You can find
more details on each of their professional
affiliations, employer and areas of
accountability on page 179. Unless we
state otherwise, all Competent Persons
listed are full-time employees at South32,
or at one of our related entities.
We report Mineral Resources and Ore
Reserves in 100 per cent terms and
represent estimates as at 30 June
2024, except for Eagle Downs. The Coal
Resource for Eagle Downs is provided as
at 12 August 2024, to align with the date
on which completion of the sale occurred.
A comparison between 30 June 2024
and 12 August 2024 (for Eagle Downs)
is provided on page 186. South32 notes
that the Coal Resources for Eagle Downs
are provided as at 12 August 2024 and
therefore include a portion of FY25.
Accordingly, there will be no further
update provided on the Coal Resources
for Eagle Downs in the FY25 Annual
Report. Our Mineral Resource estimations
include Measured and Indicated Mineral
Resources which, after the application of
all modifying factors, and development of
a mine plan, have been classified as Ore
Reserves.
We report all quantities as dry metric
tonnes, unless stated otherwise.
At a glance - Resources and Reserves (as at 30 June 2024)
Operations, development projects and options
Total Ore/Coal
Reserve (Mt)
Reserve Life
Years
(1)
Total Mineral/
Coal Resource
(Mt)
Worsley Alumina 199 12 1,080
Brazil Alumina (MRN) 41 3.6 503
Sierra Gorda 782 16 1,870
Cannington 11 5.0 80
Hermosa
Taylor 65 19 153
Clark 55
Peake 3.3
Ambler
Arctic 43
Bornite 148
Cerro Matoso 29 8.0 300
Australia Manganese 52 5.0 138
South Africa Manganese
(2)
93 46 200
Illawarra Metallurgical Coal
(2)(3)
97 21 1,170
Eagle Downs
(4)
-
(1) Scheduled extraction period in years for the total Ore Reserves in the approved Life of Operation Plan.
(2) Reserve life for South Africa Manganese and Illawarra Metallurgical Coal is reported as the life of scheduled Coal/
Ore Reserves for Wessels and Bulli respectively. The Reserve life for each of the remaining operations is stated in
the detailed disclosures that follow.
(3) Coal Reserves in this table are presented as Marketable Coal Reserves. Process recoveries are reported in the
detailed disclosures that follow for each coal operation.
(4) Coal Resources estimate reported as at 12 August 2024.
It is important to note that Mineral
Resources and Ore Reserves are
estimations, not precise calculations.
We have rounded tonnes and grade
information to reflect the relative
uncertainty of the estimate, which is why
minor computational differences may be
present in the totals.
Our long-range forecasts are the basis for
the commodity prices and exchange rates
used to estimate the economic viability
of Ore Reserves. Our planning processes
consider the impacts of climate change
on our Ore Reserves estimates, including
assessments of operating costs and the
impact of extreme weather events on the
expectation of economic extraction.
Our Ore Reserves are within existing
permitted mining tenements. Our mineral
leases are of sufficient duration, or
convey a legal right to renew the tenure,
to enable all Ore Reserves on the leased
properties to be mined in accordance
with the current production schedules.
These Ore Reserves may include areas
where additional regulatory approvals
are required, and we expect that such
approvals will be obtained within the
timeframe needed for the current
production schedule.Our expectation is
that while future approval conditions may
be more onerous than current operating
conditions, they would be reasonable,
scientifically based and aligned with
prevailing legislation.
Our governance arrangements
and internal controls
We have internal standards and
governance arrangements that cover
regulatory requirements for public
reporting. To facilitate correct and
accurate public reporting with respect to
Mineral Resources and Ore Reserves, our
governance processes are managed by
the Resource and Reserve Governance
function in coordination with the Company
Secretariat function.
Our comprehensive review and audit
program is aimed at assuring our Mineral
Resource and Ore Reserve estimates. This
includes:
– Annual review of Mineral Resources and
Ore Reserves declarations and reports;
– Annual review of reconciliation
performance metrics for operating
mines;
– Periodic internal mine planning and Ore
Reserve audits; and
– Independent audits of Exploration
Results, Mineral Resources or Ore
Reserves that are new or have
materially changed.
In FY24, we undertook four independent
assurance audits of Mineral Resource or
Ore Reserve estimates and two internal
mine planning and Ore Reserve assurance
audits. The frequency and scope of
the audits are generally a function of
the perceived risks and uncertainties
associated with a particular Mineral
Resource and Ore Reserve.
The accompanying tables, on pages 180
to 186, outline our Mineral/Coal Resources
and Ore/Coal Reserves holdings.
Resources and Reserves continued
178
SOUTH 32 ANNUAL REPORT 2024
Our exploration, research and
development
Our operations carry out exploration,
research and development necessary
to support our activities. Our brownfield
exploration activities target the
delineation and categorisation of mineral
deposits connected or adjacent to our
existing operations. Our greenfield
exploration activities focus on the
discovery and delineation of opportunities
outside of our operational footprint, with a
bias to base metals.
During FY24 we continued to expand
our global exploration footprint. We
funded greenfield exploration in
Australia, Argentina, Ireland, Canada
and the United States of America. Our
exploration expenditure for FY24 was
US$89 million (FY23: US$107 million) of
which US$36 million related to brownfield
and US$53 million related to greenfield
(FY23: US$36 million and US$71 million
respectively).
Competent Persons
Mineral Resources
Worsley Alumina: P Soodi Shoar, MAusIMM
Brazil Alumina:
Mineração Rio Do Norte (MRN): R Aglinskas, MAusIMM, employed by MRN
Sierra Gorda: O Cortez, MAusIMM, employed by Sierra Gorda S.C.M.;
Ian Glacken, FAusIMM (CP), employed by Snowden Optiro
Cannington: S Bowman, MAusIMM
Hermosa:
Taylor, Clark and Peake: P Garretson, MAusIMM
Ambler Metals Joint Venture:
Arctic: M Job, FAusIMM, employed by Cube Consulting
Bornite: S Khosrowshahi, MAusIMM (CP), employed by WSP
T Fouet, MAusIMM (CP)
Cerro Matoso: Ian Glacken, FAusIMM (CP), employed by Snowden Optiro
Australia Manganese:
Groote Eylandt Mining Company (GEMCO): J Harvey, MAusIMM
South Africa Manganese:
Wessels and Mamatwan: J Harvey, MAusIMM
Ore Reserves
Worsley Alumina: U Sandilands, MAusIMM
Brazil Alumina:
MRN: L Diniz Costa, MAusIMM, employed by LHD Mineral Consultancy
Sierra Gorda: Paola Villagran, Registered member of Chilean Mining Commission.,
employed by Sierra Gorda S.C.M.
Cannington: R Muller, MAusIMM
Hermosa:
Taylor: P Garretson, MAusIMM
Cerro Matoso: N Monterroza, MAusIMM
Australia Manganese:
GEMCO: C Dekker, MAusIMM
South Africa Manganese:
Wessels and Mamatwan: D Takalani, SAIMM, employed by Consulting Evolution
Mining
Coal Resources
Illawarra Metallurgical Coal:
Bulli and Wongawilli: M Krejci, MAusIMM
Eagle Downs: M Blaik, MAusIMM, employed by JB Mining Services
Coal Reserves
Illawarra Metallurgical Coal:
Bulli and Wongawilli: M Rose, MAusIMM
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
179
SOUTH 32 ANNUAL REPORT 2024
Accompanying tables
Alumina
Mineral Resources
As at 30 June 2024 As at 30 June 2023
Measured Mineral Resources Indicated Mineral Resources Inferred Mineral Resources Total Mineral Resources
South32
Interest Total Mineral Resources
Deposit
(1)
Material Type Mt % A.Al
2
O
3
% R.SiO
2
Mt % A.Al
2
O
3
% R.SiO
2
Mt % A.Al
2
O
3
% R.SiO
2
Mt % A.Al
2
O
3
% R.SiO
2
% Mt % A. Al
2
O
3
% R.SiO
2
Worsley Laterite 287 28.6 1.6 412 29.1 2.1 377 28.4 2.1 1,080 28.7 1.9 86 1,100 28.6 1.9
MRN
(2)(3)
MRN Washed 465 47.4 5.3 3.6 48.9 2.5 34 47.3 5.2 503 47.4 5.2 33 448 49.6 4.2
Ore Reserves
As at 30 June 2024 As at 30 June 2023
Proved Ore Reserves Probable Ore Reserves Total Ore Reserves Reserve Life
South32
Interest Total Ore Reserves Reserve Life
Deposit
(1)(6)
Ore Type Mt % A.Al
2
O
3
% R.SiO
2
Mt % A.Al
2
O
3
% R.SiO
2
Mt % A.Al
2
O
3
% R.SiO
2
Years % Mt % A.Al
2
O
3
% R.SiO
2
Years
Worsley
(4)(7)
Laterite 168 28.2 1.6 31 28.0 1.6 199 28.2 1.6 12 86 217 28.1 1.6 13
MRN
(2)(5)
MRN Washed 38 48.9 4.9 2.9 49.0 4.9 41 48.9 4.9 3.6 33 39 48.7 4.8 4.0
(1) Cut-off grade
Mineral Resources Ore Reserves
Worsley Variable ranging from 22-25% A.Al
2
O
3
, ≤3% R.SiO
2
for mineralised material and
≥28% A.Al
2
O
3
, ≤3-5% R.SiO
2
for blend material and ≥1m thickness
Variable ranging from 22.5-29% A.Al
2
O
3
, <3-5% R.SiO
2
and variable thickness ≥1-2m
MRN A.Al
2
O
3
≥35% and mass recovery ≥50%, for all reported plateaus Economic cut-off of US$>0 (considering revenue and all cost assumptions); and R.SiO
2
<6.5%.
(2) MRN Washed tonnes and grades represent the expected product based on forecast beneficiation yield.
(3) Change in Mineral Resource estimate following review of mineralised envelope.
(4) Ore delivered to Worsley alumina refinery.
(5) Ore delivered to Alumar alumina refinery.
(6) Metallurgical recovery:
Worsley 92.9%
Alumar 91.0%
(7) On 8 July 2024, the Western Australian Environmental Protection Authority (EPA) published its recommendation that the Worsley Mine Development Project may be implemented, subject to conditions. Worsley Alumina considers that several of the
recommended conditions go beyond reasonable measures for managing environmental risks of the proposal based on scientific assessment and decades of operating experience and have lodged an appeal in relation to the EPA assessment report.
The Competent Person does not foresee any material change to the reported Ore Reserves based on a preliminary assessment of the conditions recommended in the EPA assessment report. The EPA assessment report is available to view on https://
www.epa.wa.gov.au/
Resources and Reserves continued
180
SOUTH 32 ANNUAL REPORT 2024
Base Metals
Mineral Resources
As at 30 June 2024 As at 30 June 2023
Measured Mineral Resources Indicated Mineral Resources Inferred Mineral Resources Total Mineral Resources
South32
Interest Total Mineral Resources
Deposit
(1)
Material Type Mt % TCu g/t Au % Mo Mt % TCu g/t Au % Mo Mt % TCu g/t Au % Mo Mt % TCu g/t Au % Mo % Mt % TCu g/t Au % Mo
Sierra Gorda
(2)
OC Sulphide 377 0.40 0.07 0.025 534 0.34 0.06 0.013 906 0.37 0.06 0.013 1,820 0.36 0.06 0.016 45 1,890 0.36 0.06 0.016
Stockpile 51 0.28 0.05 0.013 51 0.28 0.05 0.013 - - - -
As at 30 June 2024 As at 30 June 2023
Measured Mineral Resources Indicated Mineral Resources Inferred Mineral Resources Total Mineral Resources
South32
Interest Total Mineral Resources
Deposit
(1)
Material Type Mt g/t Ag % Pb % Zn Mt g/t Ag % Pb % Zn Mt g/t Ag % Pb % Zn Mt g/t Ag % Pb % Zn % Mt g/t Ag % Pb % Zn
Cannington
(3)
UG Sulphide 40 165 4.81 2.91 9.8 95 2.80 2.84 3.1 57 2.08 2.52 53 146 4.27 2.88 100 48 155 4.44 2.94
OC Sulphide 20 113 3.45 2.28 4.9 58 2.22 2.00 1.7 55 2.04 1.48 27 99 3.13 2.18 25 90 2.94 2.14
Ore Reserves
As at 30 June 2024 As at 30 June 2023
Proved Ore Reserves Probable Ore Reserves Total Ore Reserves Reserve Life
South32
Interest Total Mineral Resources Reserve Life
Deposit
(1)(4)(5)(6)
Material Type Mt % TCu g/t Au % Mo Mt % TCu g/t Au % Mo Mt % TCu g/t Au % Mo Years % Mt % TCu g/t Au % Mo Years
Sierra Gorda OC Sulphide 344 0.41 0.07 0.025 387 0.37 0.06 0.014 731 0.39 0.06 0.020 16 45 - - - - -
Stockpile 51 0.28 0.05 0.013 51 0.28 0.05 0.013 - - - -
As at 30 June 2024 As at 30 June 2023
Proved Ore Reserves Probable Ore Reserves Total Ore Reserves Reserve Life
South32
Interest Total Ore Reserves Reserve Life
Deposit
(1)(4)(6)
Ore Type Mt g/t Ag % Pb % Zn Mt g/t Ag % Pb % Zn Mt g/t Ag % Pb % Zn Years % Mt g/t Ag % Pb % Zn Years
Cannington UG Sulphide 9.6 189 5.60 3.30 1.5 257 6.35 2.32 11 198 5.70 3.17 5.0 100 15 183 5.33 3.02 6.0
(1) Cut-off grade
Mineral Resources Ore Reserves
Cannington Net smelter return in A$/t Net smelter return in A$/t
UG Sulphide 130 145
OC Sulphide 58
Sierra Gorda Net smelter return in US$/t
OC Sulphide >0 >0
Stockpile No cut-off grade applied No cut-off grade applied
(2) First time reporting of Mineral Resources estimate of sulphide stockpiles.
(3) Change to Mineral Resource due to updated model methodology, price protocol and mine optimisation.
(4) Ore delivered to process plant.
(5) First time reporting of Ore Reserve estimate.
(6) Metallurgical recoveries:
Cannington 85.8% Ag, 87.6% Pb and 83% Zn
Sierra Gorda 83% TCu, 54% Mo and 47% Au
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
181
SOUTH 32 ANNUAL REPORT 2024
Base Metals continued
Mineral Resources
As at 30 June 2024 As at 30 June 2023
Measured Mineral Resources Indicated Mineral Resources Inferred Mineral Resources Total Mineral Resources
South32
Interest Total Mineral Resources
Deposit
(1)
Material Type Mt % Zn % Pb % Mn g/t Ag Mt % Zn % Pb % Mn g/t Ag Mt % Zn % Pb % Mn g/t Ag Mt % Zn % Pb % Mn g/t Ag % Mt % Zn % Pb % Mn g/t Ag
Hermosa 100
Taylor UG Sulphide 41 4.22 4.25 67 83 3.38 3.91 76 28 2.96 2.97 93 153 3.53 3.83 77 153 3.53 3.83 77
Clark UG Oxide 0.4 1.77 8.11 56 35 2.40 9.49 58 20 1.61 8.33 115 55 2.11 9.07 78 55 2.11 9.07 78
As at 30 June 2024 As at 30 June 2023
Measured Mineral Resources Indicated Mineral Resources Inferred Mineral Resources Total Mineral Resources
South32
Interest Total Mineral Resources
Deposit
(1)
Material Type Mt % Cu % Zn % Pb g/t Ag Mt % Cu % Zn % Pb g/t Ag Mt % Cu % Zn % Pb g/t Ag Mt % Cu % Zn % Pb g/t Ag % Mt % Cu % Zn % Pb g/t Ag
Hermosa 100
Peake UG Sulphide 3.3 1.64 0.32 0.61 49 3.3 1.64 0.32 0.61 49 3.3 1.64 0.32 0.61 49
As at 30 June 2024 As at 30 June 2023
Measured Mineral Resources Indicated Mineral Resources Inferred Mineral Resources Total Mineral Resources
South32
Interest Total Mineral Resources
Deposit
(1)
Material Type Mt % Cu % Zn % Pb g/t Ag g/t Au Mt % Cu % Zn % Pb g/t Ag g/t Au Mt % Cu % Zn % Pb g/t Ag g/t Au Mt % Cu % Zn % Pb g/t Ag g/t Au % Mt % Cu % Zn % Pb g/t Ag g/t Au
Ambler 50
Arctic
(2)
OC Sulphide 24 3.14 4.35 0.77 49 0.62 15 2.84 4.46 0.84 46 0.60 3.7 1.84 3.24 0.70 39 0.40 43 2.93 4.30 0.79 47 0.59 37 3.06 4.30 0.77 47 0.60
Bornite OC Sulphide 40 1.06 38 1.03 78 1.04 78 1.04
UG Sulphide 70 2.29 70 2.29 70 2.29
Ore Reserves
As at 30 June 2024 As at 30 June 2023
Proved Ore Reserves Probable Ore Reserves Total Ore Reserves Reserve life
South32
Interest Total Mineral Resources Reserve life
Deposit
(1)(3)(4)
Material Type Mt % Zn % Pb g/t Ag Mt % Zn % Pb g/t Ag Mt % Zn % Pb g/t Ag Years % Mt % Zn % Pb g/t Ag Years
Hermosa
Taylor UG Sulphide 65 4.35 4.90 82 65 4.35 4.90 82 19 100 - - - - -
(1) Cut-off grade
Mineral Resources Ore Reserves
Net smelter return in US$/t Net smelter return in US$/t
Taylor UG Sulphide 80 90
Clark UG Oxide 175
Peake UG Sulphide 80
Arctic OC Sulphide 62
Bornite
OC Sulphide 0.5% Cu
UG Sulphide 1.5% Cu
(2) Change to Mineral Resource due to additional drilling.
(3) First time reporting of Ore Reserve estimate - refer to market release "Final investment approval to develop Hermosa's Taylor deposit" dated 15 Feb 2024.
(4) Metallurgical recoveries: 85% to 92% for Pb in Pb concentrate; 75% to 92% for Zn in Zn concentrate; 52% to 83% for Ag in Pb concentrate; and 7% to 11% for Ag in Zn concentrate.
Resources and Reserves continued
182
SOUTH 32 ANNUAL REPORT 2024
Nickel
Mineral Resources
As at 30 June 2024 As at 30 June 2023
Measured Mineral Resources Indicated Mineral Resources Inferred Mineral Resources Total Mineral Resources
South32
Interest Total Mineral Resources
Deposit
(1)
Material Type Mt % Ni Mt % Ni Mt % Ni Mt % Ni % Mt % Ni
Cerro Matoso Laterite 116 0.9 129 0.8 9.0 0.8 254 0.9 99.9 263 0.9
Stockpile 18 1.0 28 0.8 46 0.9 53 0.9
Ore Reserves
As at 30 June 2024 As at 30 June 2023
Proved Ore Reserves Probable Ore Reserves Total Ore Reserves Reserve Life
South32
Interest Total Ore Reserves Reserve Life
Deposit
(1)(2)(3)
Ore Type Mt % Ni Mt % Ni Mt % Ni Years % Mt % Ni Years
Cerro Matoso Laterite 13 1.1 2.8 1.1 16 1.1 8.0 99.9 17 1.2 9.0
Stockpile 8.1 1.1 5.1 0.9 13 1.0 16 1.0
(1) Cut-off grade
Mineral Resources Ore Reserves
Laterite 0.6% Ni 0.6% Ni
Stockpile 0.6% Ni 0.6% Ni
(2) Ore delivered to process plant.
(3) Global recovery: 80%
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
183
SOUTH 32 ANNUAL REPORT 2024
Manganese
Mineral Resources
As at 30 June 2024 As at 30 June 2023
Measured Mineral Resources Indicated Mineral Resources Inferred Mineral Resources Total Mineral Resources
South32
Interest Total Mineral Resources
Deposit
(1)
Material Type Mt % Mn % Yield Mt % Mn % Yield Mt % Mn % Yield Mt % Mn % Yield % Mt % Mn % Yield
Australia Manganese 60
GEMCO ROM
(2)
66 44.8 47 39 41.0 47 21 44.3 45 126 43.5 47 127 43.6 47
Sands
(3)
12 19.8 12 19.8 13 20.0
Mt % Mn % Fe Mt % Mn % Fe Mt % Mn % Fe Mt % Mn % Fe Mt % Mn % Fe
South Africa Manganese
(3)
44.4
Wessels Lower Body 26 42.8 12.5 13 43.9 16.3 3.5 45.2 15.1 43 43.3 13.9 46 43.4 13.6
Upper Body 6.9 41.9 17.6 70 41.0 18.8 12 40.7 21.5 89 41.0 19.1 88 41.0 19.0
Mamatwan M, C, N Zones 38 36.8 4.5 5.8 36.9 4.7 - - - 44 36.8 4.6 47 36.8 4.5
X Zone 2.9 36.4 4.6 0.1 36.0 5.1 - - - 3.0 36.4 4.6 3.2 36.7 4.6
Top Cut (balance I&O) 18 29.6 5.8 2.7 29.9 5.9 - - - 21 29.6 5.8 17 29.7 6.1
Ore Reserves
As at 30 June 2024 As at 30 June 2023
Proved Ore Reserves Probable Ore Reserves Total Ore Reserves Reserve Life
South32
Interest Total Ore Reserves Reserve Life
Deposit
(1)(7)
Ore Type Mt % Mn % Yield Mt % Mn % Yield Mt % Mn % Yield Years % Mt % Mn % Yield Years
Australia Manganese 60
GEMCO
(4)(5)
ROM 20 43.2 58 26 41.4 54 46 42.2 56 5.0 42 42.6 56 4.7
Sands 6.1 40.0 20 6.1 40.0 20 7.0 40.0 22
Mt % Mn % Fe Mt % Mn % Fe Mt % Mn % Fe Mt % Mn % Fe
South Africa Manganese
(6)
44.4
Wessels Lower Body 6.0 43.2 10.4 7.2 44.1 17.6 13 43.7 14.3 46 15 43.9 13.8 41
Upper Body 3.9 42.1 17.6 39 41.2 18.7 43 41.3 18.6 43 41.2 18.6
Mamatwan M, C, N Zones 23 36.0 4.4 14 36.2 4.6 37 36.1 4.5 13 41 36.6 4.6 13
(1) Cut-off grade
Mineral Resources Ore Reserves
GEMCO ROM ≥35% Mn washed product. ≥36% average Mn washed product per ore mining block.
Sands No cut-off grade applied. No cut-off grade applied.
Wessels ≥37.5% M n ≥ 37.5% Mn
Mamatwan M, C, N Zones No cut-off grade applied. No cut-off grade applied.
X Zone ≥35% Mn
Top Cut (balance I&O) ≥28% Mn
(2) Mineral Resource tonnes are stated as in situ, manganese grades are stated as per washed ore samples and should be read together with their respective mass recovery expressed as yield.
(3) Mineral Resource tonnes and grades are stated as in-situ.
(4) Ore Reserve tonnes are stated as delivered to process plant, manganese grades are stated as expected product and should be read together with their respective mass yields.
(5) Change to Ore Reserve due to change in assumptions to optimise ore recovery above cut-off parameters.
(6) Ore delivered to process plant.
(7) Metallurgical/Plant recoveries:
GEMCO See yield in Ore Reserves Table.
Wessels 97%
Mamatwan 93%
Resources and Reserves continued
184
SOUTH 32 ANNUAL REPORT 2024
Metallurgical Coal
Coal Resources
As at 30 June 2024 As at 30 June 2023
Measured Coal Resources Indicated Coal Resources Inferred Coal Resources Total Coal Resources
South32
Interest Total Coal Resources
Deposit
(1)
Mining
Method Coal Type Mt % Ash % VM % S Mt % Ash % VM % S Mt % Ash % VM % S Mt % Ash % VM % S % Mt % Ash % VM % S
Illawarra Metallurgical Coal
(2)
100
Bulli UG Met/Th 173 11.4 24.0 0.36 281 12.3 23.6 0.35 303 13.4 23.0 0.35 757 12.5 23.4 0.36 769 12.5 23.5 0.36
Wongawilli UG Met/Th 60 29.1 23.2 0.59 224 29.8 22.2 0.57 129 30.1 22.4 0.57 413 29.8 22.4 0.57 419 29.8 22.2 0.57
Eagle Downs
(3)
UG Met 759 29.4 15.0 0.46 201 28.7 14.7 0.48 183 30.0 14.8 0.47 1,140 29.4 14.9 0.47 50 1,140 29.4 14.9 0.47
Coal Reserves
As at 30 June 2024 As at 30 June 2023
Proved
Coal
Reserves
Probable
Coal
Reserves
Total
Coal
Reserves
Proved Marketable
Coal Reserves
Probable Marketable
Coal Reserves
Total Marketable
Coal Reserves
Reserve
Life
South32
Interest
Total Marketable
Coal Reserves
Reserve
Life
Deposit
(1)(4)(5)(6)
Mining
Method
Coal
Type Mt Mt Mt Mt % Ash % VM % S Mt % Ash % VM % S Mt % Ash % VM % S Years % Mt % Ash % VM % S Years
Illawarra Metallurgical Coal 100
Bulli UG Met 14 89 103 11 8.9 24.2 0.36 75 8.9 24.7 0.35 86 8.9 24.6 0.35 21 88 8.9 24.6 0.35 23
Wongawilli UG Met/Th 8.0 6.9 15 8.0 8.9
UG Met 3.9 10.8 23.1 0.58 3.4 10.8 22.8 0.59 7.3 10.8 23.0 0.59 6.9 10.8 23.1 0.58
UG Th 2.0 28.0 1.7 28.0 3.7 28.0 3.7 28.0
(1) Cut-off grade
Coal Resources Coal Reserves
No seam thickness cut-off applied, minimum thickness is economic. No seam thickness cut-off applied, minimum thickness within the mine layout is economic.
(2) Coal Resource tonnes are reported on an in-situ moisture basis, Ash is reported as raw, VM and S are reported as potential product on air-dried basis.
(3) Coal Resource tonnes are reported on an in-situ moisture basis, Ash, VM and S reported as raw.
(4) Total Coal Reserves are at the moisture content when mined (6% Bulli, 8% Wongawilli), Total Marketable Coal Reserves are the tonnes of coal available at moisture content (8.5% Bulli, 15% Wongawilli Met, 6% Wongawilli Th) and air-dried qualities after the
beneficiation of the Total Coal Reserves.
(5) Coal delivered to wash plant.
(6) Process recoveries:
Bulli 84%
Wongawilli 73%
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
185
SOUTH 32 ANNUAL REPORT 2024
Metallurgical Coal
Coal Resources
As at 12 August 2024
(1)
As at 30 June 2024
Measured Coal Resources Indicated Coal Resources Inferred Coal Resources Total Coal Resources
South32
Interest Total Coal Resources
Deposit
Mining
Method Coal Type Mt % Ash % VM % S Mt % Ash % VM % S Mt % Ash % VM % S Mt % Ash % VM % S % Mt % Ash % VM % S
Eagle Downs
(2)
UG Met - - - - - - - - - - - - - - - - - 1,140 29.4 14.9 0.47
(1) Coal Resource estimate for and Eagle Downs will not be included in FY25 Annual Report.
(2) Eagle Downs Assests divested from South32 on 12 August 2024
Resources and Reserves continued
186
SOUTH 32 ANNUAL REPORT 2024
Shareholder information
Voting rights for shares
South32 Limited ordinary shares carry voting rights of one vote per share.
Shareholders may hold a beneficial entitlement to South32 Limited dematerialised ordinary shares, United Kingdom (UK) Depositary
Interests and American Depositary Shares (ADS) through the Central Securities Depositories of Strate (Strate), CREST and the
Depository Trust Company, respectively. Each share held dematerialised in Strate, or as a Depositary Interest held in CREST, entitles the
holder to one vote. Each ADS is represented by five ordinary shares, with ADS voting managed by South32 Limited’s ADS Depositary.
Substantial shareholders
The following table shows the substantial shareholders who, together with their associates, hold five per cent or more of the voting
rights in South32 Limited, as notified to South32 Limited under the Corporations Act, as at 31 July 2024.
Name Date notice received Number of shares in notice Percentage of capital in notice
BlackRock Group 8 December 2021 318,403,413 6.84
State Street Corporation 3 May 2024 273,738,762 6.04
Vanguard Group 31 January 2024 276,360,221 6.102
Distribution of shareholdings and number of shareholders
The following table shows the distribution of South32 Limited shareholders by size of shareholding and number of shareholders and
shares as at 31 July 2024.
Size of holding Number of shareholders Number of shares Percentage of capital
1 – 1,000 114,068 54,483,348 1.20
1,001 – 5,000 83,599 205,536,540 4.54
5,001 – 10,000 25,099 18 4 ,467,9 94 4.07
10,001 – 100,000 23,448 541,314,432 11.95
100,001 and over 789 3,543,456,254 78.23
Total 247,003 4,529,258,568 100.00
Distribution of rights holdings and number of rights holders
The following table shows the distribution of rights holders in South32 Limited by size of rights holding and number of rights holders and
rights as at 31 July 2024.
Size of holding Number of rights holders Number of rights Percentage of rights on issue
0 - 1,000 1,000 599,680 1.26
1,001 - 5,000 6,090 7,853,775 16.48
5,001 - 10,000 7 52,572 0.11
10,001 - 100,000 103 5,252,446 11.02
100,001 and over 68 33,890,232 71.13
Total 7,268 47,6 4 8 ,705 100.00
188
SOUTH 32 ANNUAL REPORT 2024
Twenty largest shareholders in South32 Limited
The following table sets out the 20 largest shareholders of ordinary shares listed on the South32 Limited share register and the details
of their shareholding as at 31 July 2024.
Name Number of fully paid shares Percentage of capital
1 HSBC Custody Nominees (Australia) Limited 1,136,707,884 25.10
2 J P Morgan Nominees Australia Pty Limited 918,427,450 20.28
3 Citicorp Nominees Pty Ltd 421, 3 47,684 9.30
4 South Africa Control A/C\C 316,660,868 6.99
5 BNP Paribas Nominees Pty Ltd <Agency Lending A/C> 110,014,206 2.43
6 Citicorp Nominees Pty Limited <Citibank Ny Adr Dep A/C> 82,102,155 1.81
7 National Nominees Limited 76,428,547 1.69
8 Computershare Clearing Pty Ltd <Ccnl Di A/C> 55,416,224 1.22
9 BNP Paribas Noms Pty Ltd 47,816,948 1.06
10 HSBC Custody Nominees (Australia) Limited <Nt-Comnwlth Super Corp A/C> 32,689,685 0.72
11 Citicorp Nominees Pty Limited <Colonial First State Inv A/C> 19,813,190 0.44
12 BNP Paribas Nominees Pty Ltd <Hub24 Custodial Serv Ltd> 16,740,792 0.37
13 Cpu Share Plans Pty Ltd <S32 Asp Unallocated A/C> 14,936,429 0.33
14 BNP Paribas Nominees Pty Ltd <Clearstream> 9,483,433 0.21
15 Netwealth Investments Limited <Wrap Services A/C> 9,142,788 0.20
16 HSBC Custody Nominees (Australia) Limited 8,114,733 0.18
17 HSBC Custody Nominees (Australia) Limited - A/C 2 7,163,555 0.16
18 UBS Nominees Pty Ltd 6,503,121 0.14
19 Prudential Nominees Pty Ltd 6,000,000 0.13
20 Merrill Lynch (Australia) Nominees Pty Limited 5,913,643 0.13
Total 3,301,423,335 72.89
Restricted and escrowed
securities
As at 31 July 2024, South32 Limited does
not have any restricted securities or
securities subject to voluntary escrow on
issue.
Shareholders with less than a
marketable parcel
As at 31 July 2024, there were 12,793
shareholders on the Australian South32
Limited register holding less than a
marketable parcel (A$500) based on the
closing market price of A$$3.07.
On-market purchases of South32
Limited securities for employee
incentive plans
The Group purchased South32 Limited
ordinary shares on-market through the
Company’s employee share plan trusts
for the purposes of the South32 Equity
Incentive Plans.
During FY24, 4,300,000 shares were
purchased on-market for the Australian
ESOP Trust. The average price at which the
shares were purchased was A$3.39.
No shares were purchased for the South
African ESOP Trust during FY24.
In addition, 45,048 shares were purchased
on-market and immediately distributed
to Canadian based employees on vesting
of rights. The average price at which the
shares were purchased was A$3.47.
(1) Numbers in this section are subject to rounding.
Dividend policy
Our dividend policy is determined by the
Board at its discretion. Our priorities for
cash flow are to maintain safe and reliable
operations and an investment grade credit
rating through the cycle.
Our current dividend policy is that South32
Limited intends to distribute a minimum
of 40 per cent of Underlying earnings as
ordinary dividends to our shareholders
following each six-month reporting period.
South32 Limited intends to distribute
dividends with the maximum practicable
franking credits for the purposes of the
Australian dividend imputation system.
Dividend determination and
payment
Our dividends are determined in United
States (US) dollars.
Dividends for shareholders of South32
Limited on the Australian register are
paid by direct credit into shareholders’
nominated bank account in Australian
dollars, UK pounds sterling, New Zealand
dollars or US dollars, provided direct credit
details and currency election information
is submitted no later than close of
business on the dividend record date as
stated in the relevant Australian Securities
Exchange (ASX) announcement.
Dividends for shareholders of South32
Limited on the South African branch
register and UK Depositary Interest
holders are paid by direct credit in South
African rand and UK pounds sterling,
respectively.
Refer to the Investors section at
www.south32.net for further information
about dividends.
Capital management program
(1)
In February 2024, to manage our financial
position and retain the right balance of
flexibility, efficiency and prudence, we
cancelled our on-market share buy-back,
which was due to expire on 1 March
2024. The on-market share buy-back
was initially announced on 27 March 2017
and purchasing commenced on 19 April
2017. Between the commencement of
purchasing under the on-market share
buy-back on 19 April 2017 and 30 June
2024, South32 Limited purchased a total
of 794.5 million shares, which represented
15 per cent of share capital at the
commencement of the program. The
total consideration paid for the shares
bought back up to 30 June 2024 was
US$1.7 billion.
During the year ended 30 June 2024,
South32 Limited purchased 16 million
shares under the on-market share buy-
back, which represented two per cent
of share capital at the beginning of the
financial year. Total consideration paid
for these shares was US$35 million. The
shares have no par value. The shares
purchased by South32 Limited under the
on-market share buy-back have been
cancelled.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
189
SOUTH 32 ANNUAL REPORT 2024
Shareholder information continued
As at 30 June 2024, we have returned a
total of US$2.3 billion to our shareholders
under our capital management
program, comprising US$1.7 billion
via our on-market share buy-back and
special dividends of US$154 million
(paid in 2018), US$85 million (paid in
2019), US$53.5 million (paid in 2020),
US$93 million (paid in 2021) and
US$139 million (paid in 2022).
On 29 August 2024, we announced our
intention to allocate US$200 million
through our ongoing capital management
program, to be returned to shareholders
via an on-market share buy-back,
commencing from completion of the
sale of Illawarra Metallurgical Coal.
This will take returns under our capital
management program to US$2.5 billion,
with the US$200 million increase in the
program to be returned to shareholders
by 12 September 2025.
Annual General Meeting (AGM)
Our 2024 AGM is scheduled to be held on
Thursday 24 October 2024 at 12.00pm
(midday) Australian Western Standard
Time as a hybrid meeting, providing
shareholders with the opportunity
to attend physically or online. If it
becomes necessary or appropriate to
make alternative or supplementary
arrangements, we will provide an update.
Further details regarding the AGM will be
made available in September 2024, and
shareholders are encouraged to monitor
securities exchange releases and
www.south32.net for information and
updates.
Addresses delivered at the AGM, together
with the results of voting, will be provided
to all stock exchanges where we are listed
and will be available at www.south32.net.
Stock exchanges
As at 31 July 2024, South32 Limited has a
primary listing on the ASX, a secondary
listing on the Johannesburg Stock
Exchange and is admitted to listing in the
equity shares (international commercial
companies secondary listing) category of
the Official List in the UK and its ordinary
shares are traded on the London Stock
Exchange. South32 Limited also has a
Level 1 American Depositary Receipts
(ADR) program, which trades in the US
over-the-counter market.
Shareholder enquiries
Shareholders can access their current
holding details as well as their transaction
history, view dividend statements and
payments made, download statements
and documents, change their address,
update their communication preferences
and banking details, and check their tax
details online via Computershare’s Investor
Centre at www.computershare.com.
Alternatively, refer to the following
contacts:
Share registries
Australia
Computershare Investor Services Pty
Limited
Yarra Falls 452 Johnston Street
Abbotsford Victoria 3067
Australia
Telephone (Australia): 1800 019 953
Telephone (International): +61 3 9415 4169
Facsimile: +61 3 9473 2500
South Africa
Computershare Investor Services (Pty)
Limited
Rosebank Towers, 15 Biermann Avenue
Rosebank 2196
South Africa
Telephone: +27 11 373 0033
Facsimile: +27 11 688 5217
Email enquiries:
web.queries@computershare.co.za
Holders of shares dematerialised into
Strate should contact their Central
Securities Depository Participant or
stockbroker.
United Kingdom
Computershare Investor Services PLC
The Pavilions, Bridgwater Road
Bristol BS99 6ZZ
United Kingdom
Telephone: +44 370 873 5884
Facsimile: +44 370 703 6101
Email enquiries:
web.queries@computershare.co.uk
ADR
ADR holders should deal directly with
Citibank Shareholder Services.
Citibank Shareholder Services
PO Box 43077 Providence
Rhode Island 02940-3077
Telephone: +1 877 248 4237
(+1-877-CITIADR) (toll-free within US)
+1 781 575 4555 (outside of US)
Facsimile: +1 201 324 3284
Email enquiries:
citibank@shareholders-online.com
Website: www.citi.com/dr
Branches
In accordance with DTR 4.1.11R(5), South32
Limited, through various subsidiaries,
has established branches in different
jurisdictions in which the business
operates.
Registered office
South32 Limited’s Registered Office is
Information regarding South32’s other
office locations is included in the
Corporate directory on page 199.
Electronic communications
Shareholders are encouraged to
access all South32 communications
electronically. Shareholders that wish to
receive electronic communications can
update their preferences online or by
contacting the relevant Computershare
Investor Centre. Refer to the Investors
section at www.south32.net for further
details on how to receive shareholder
communications.
190
SOUTH 32 ANNUAL REPORT 2024
Glossary of terms and abbreviations
AASB
Australian Accounting Standards Board.
Adjusted return on invested capital
(ROIC)
Calculated as Underlying EBIT, adjusted
for uncontrollable and one-off impacts in
the current financial year, less the discount
on rehabilitation provisions included in net
finance cost, tax effected by the Group’s
prior period Underlying effective tax
rate (ETR) including our material equity
accounted investments on a proportional
consolidated basis, divided by the sum of
fixed assets (excluding any rehabilitation
assets, the impairment reversal of Brazil
Aluminium, and unproductive capital) and
inventories. Underlying EBIT is adjusted
by excluding the current period impacts
of foreign currency on revenue and cost,
and commodity prices on revenue and
associated price-linked costs, less the
discount on rehabilitation provisions
included in net finance cost, and tax
effected by the Group’s prior period
Underlying effective tax rate.
AGM
Annual General Meeting.
Alumina
Aluminium oxide (Al₂O₃). Alumina is
produced from bauxite in the Bayer
refining process. It’s then converted
(reduced) in an electrolysis cell to produce
aluminium metal.
American Depositary Receipts (ADR)
An ADR is a security that represents
shares of non-U.S. companies that are
held by a U.S. depositary bank outside the
United States.
AO
Officer of the Order of Australia.
Ash
Inorganic material remaining after
combustion of coal.
ASX
ASX Limited or Australian Securities
Exchange.
ASX Listing Rules
The rules governing the listing of an entity
and the quotation of its securities on the
ASX.
ASX Listing Rules (Chapter 5)
This chapter of the ASX Listing Rules sets
out additional reporting and disclosure
requirements for mining entities, oil and
gas entities, and other entities reporting
on mining and oil and gas activities.
Australian Securities and Investments
Commission (ASIC)
The independent Australian Government
body that is Australia’s integrated
corporate, markets, financial services and
consumer credit regulator.
Baseline water stress
The ratio of total annual water withdrawals
to total available renewable surface and
groundwater supplies, accounting for
upstream consumptive use. Higher values
indicate more competition among users.
The values and definition of baseline water
stress have been derived from World
Resources Institute (WRI) Aqueduct 4.0:
Updated Decision-Relevant Global Water.
Bauxite
Principal commercial ore of aluminium.
B-BBEE
Broad-Based Black Economic
Empowerment.
Beneficiation
The process of physically separating
ore from gangue to produce a mineral
concentrate prior to subsequent
processing.
BHP
BHP, formerly known as BHP Billiton, is
the group of companies headed by, and
including, BHP Group Ltd and BHP Group
plc.
Biodiversity
Refers to the variety of life on Earth – the
different animals, plants and micro-
organisms, their genetic diversity and the
ecosystems of which they are a part.
Black People
As defined in the Broad-Based Black
Economic Empowerment Amendment
Act 2013 (South Africa), a generic term
meaning Africans, Coloureds and Indians
who are citizens of the Republic of South
Africa by birth or descent; or who become
citizens of the Republic of South Africa by
naturalisation before 27 April 1994 or on
or after 27 April 1994 and who would have
been entitled to acquire citizenship by
naturalisation prior to that date.
Board
The Board of Directors of South32 Limited.
Brownfield
An exploration or development project
located within an existing mineral
province, which can share infrastructure
and management with an existing
operation.
Catchment
The area of land from which all surface
runoff and subsurface water flows
through a sequence of streams, rivers,
aquifers and lakes into the sea or another
outlet at a single river mouth, estuary,
or delta. Catchments include associated
groundwater areas and might include
portions of waterbodies (such as lakes
or rivers). In different parts of the world,
catchments are also referred to as
‘watersheds’ or ‘basins’ (or sub-basins).
CCAP
Climate Change Action Plan prepared in
FY2022 which can be found in our 2022
Sustainable Development Report available
at www.south32.net.
CEO
Chief Executive Officer.
CFO
Chief Financial Officer.
Coal Reserve
The same meaning as Ore Reserve, but
specifically concerning coal.
Coal Resource
The same meaning as Mineral Resource,
but specifically concerning coal.
CO
2
-e
Carbon dioxide equivalent.
Coking coal
Used in the manufacture of coke, which is
used in the steelmaking process by virtue
of its carbonisation properties. Coking
coal is a form of, and may also be referred
to as, metallurgical coal.
Competent Person
A minerals industry professional who is
a Member or Fellow of The Australasian
Institute of Mining and Metallurgy, or of the
Australian Institute of Geoscientists, or of
a ‘Recognised Professional Organisation’,
as included in a list available on the JORC
and ASX websites. These organisations
have enforceable disciplinary processes,
including the powers to suspend or expel
a member. A Competent Person must
have a minimum of five years’ relevant
experience in the style of mineralisation or
type of deposit under consideration and in
the activity that the person is undertaking
(JORC Code).
Contextual water target
A contextual water target is a specific
timebound target that is set to deliver
an intended outcome based on the
environmental and social context of the
local catchment.
Contractor
A contractor is an employee of a company
contracted by the employer to do work
on its behalf and under its control with
respect to location, work practices and
application of health and safety standards.
COO
Chief Operating Officer.
Copper equivalent production
Copper equivalent production is
calculated by accumulating revenue using
average realised prices for all operations
and dividing by the average realised price
of copper.
Corporations Act
Corporations Act 2001 (Cth).
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
191
SOUTH 32 ANNUAL REPORT 2024
Cost, Insurance, and Freight (CIF)
A contractual term defining
responsibilities and division of cost and
risk between buyer and seller, in which
the seller is responsible for clearing the
goods for export and bears the cost of
freight and insurance to the named port
of destination. The buyer assumes all risks
and costs for unloading the goods and
clearing the goods for import. Risk passes
from seller to buyer once the goods are on
board the vessel at the port of shipment.
COVID-19
Coronavirus disease (COVID-19) is an
infectious disease caused by the SARS-
CoV-2 virus.
CTO
Chief Technical Officer.
Cut-off grade
The lowest grade, or quality, of mineralised
material that qualifies as economically
mineable and available in a given deposit.
It may be defined on the basis of economic
evaluation, or on physical or chemical
attributes that define an acceptable
product specification (JORC Code).
CYXXX
Refers to the calendar year ending
31 December 20XX, where XX is the two-
digit number for the year.
Decarbonisation
Avoiding or reducing the greenhouse gas
emissions associated with an activity.
Demerger
The separation of assets from BHP
effected in May 2015 to create a separate
entity South32 Limited, listed on the ASX,
LSE and JSE.
Dewatering
Dewatering is the interception and
removal of water from operational areas.
DTR
UK Financial Conduct Authority’s
Disclosure Guidance and Transparency
Rules. A reference to DTR followed by a
number is a specific rule under the DTR.
EBIT
Earnings before interest and tax.
EBITDA
Earnings before interest, tax, depreciation
and amortisation.
Effective tax rate (ETR)
Income tax expense/benefit divided by
profit/loss subject to tax.
Employee
Any person in full-time, part-time or casual
employment engaged by South32 on a
temporary or permanent basis pursuant
to a contract of service.
Employee Share Ownership Plan (ESOP)
Trusts
The trusts which purchase and hold
South32 Limited shares for the purpose
of the South32 Equity Incentive Plans.
South32 has an Australian ESOP Trust and
South African ESOP Trust.
Energy coal
Used as a fuel source in electrical power
generation, cement manufacture and
various industrial applications. Energy coal
may also be referred to as steaming or
thermal coal.
Environmental incident
Any event with an impact to land,
biodiversity, ecosystem services, water
resources or air.
ESG
Environmental, social and governance.
EthicsPoint
A 24/7 confidential reporting hotline that is
serviced by an independent provider.
Executive KMP
Lead Team members who are classified
as K M P.
Exploration Results
Exploration Results include data and
information generated by mineral
exploration programs that might be of use
to investors but which do not form part of
a declaration of Mineral Resources or Ore
Reserves (JORC Code).
Exploration Target
An Exploration Target is a statement or
estimate of the exploration potential of
a mineral deposit in a defined geological
setting where the statement or estimate,
quoted as a range of tonnes and range of
grade (or quality), relates to mineralisation
for which there has been insufficient
exploration to estimate a Mineral
Resource.
External Auditor
KPMG.
Fatality
A health or safety event where an injury or
occupational illness has caused the death
of one or more person(s).
FAusIMM
Fellow of the Australasian Institute of
Mining and Metallurgy.
FAusIMM (CP)
Fellow of the Australasian Institute
of Mining and Metallurgy. Accredited
Chartered Professional status of members
of the AusIMM. These members have
undergone an assessment of their
competencies, which are maintained
through continuing professional
development activities.
Flotation
A method of selectively recovering
minerals from finely ground ore using a
froth created in water by specific reagents.
In the flotation process, certain mineral
particles are induced to float by becoming
attached to bubbles of froth and the
unwanted mineral particles sink.
Free cash flow
Free cash flow represents operating cash
flows including distributions received from
equity accounted investments, and after
interest (paid)/received, tax (paid)/received
and capital expenditure.
Free On Board (FOB)
A contractual term defining
responsibilities and division of cost and
risk between buyer and seller, in which the
seller is responsible for clearing the goods
for export and loading them on board the
vessel at the named port of shipment.
The buyer assumes all risks and costs for
goods from this moment forward Including
the cost of freight and insurance.
FX
Foreign exchange.
FYXX
Refers to the financial year ending 30 June
20XX, where XX is the two-digit number
for the year.
Gearing
The ratio of (net debt/(cash)) to (net debt/
(cash)) plus net assets.
GEMCO
Groote Eylandt Mining Company.
Global Reporting Initiative (GRI)
GRI is an international independent
organisation that has established an
international framework and standards for
sustainability reporting. South32 prepares
our Group-level annual Sustainable
Development Report in accordance
with the GRI Sustainability Reporting
Standards.
Goal
The use of this term in the context of
climate change in this report means
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.
Grade
Any physical or chemical measurement
of the characteristics of the material of
interest in samples or product (JORC
Code).
Glossary of terms and abbreviations continued
192
SOUTH 32 ANNUAL REPORT 2024
Greenfield
An exploration or development project
that refers to a new venture or operation,
without any association or proximity to a
current operation.
Greenhouse gas (GHG) emissions
For our reporting purposes, GHG
emissions are the combined
anthropogenic emissions of carbon
dioxide (CO
2
), methane (CH4), nitrous
oxide (N2O), perfluorocarbons (PFCs)
and sulphur hexafluoride (SF6). They are
measured in carbon dioxide equivalent
(CO
2
-e). Hydrofluorocarbons (HFCs) GHG
emissions are currently not relevant for
our reporting purposes.
– Scope 1 emissions - GHG emissions
from our own operations, including the
electricity we generate at our sites.
– Scope 2 emissions - Indirect GHG
emissions from the generation of
purchased electricity.
– Scope 3 emissions - GHG emissions in
the value chain.
HY1 FYXX
Refers to the 6 months starting on 1 July
20XX and ending on 31 December 20XX,
where XX is the two-digit number for the
year.
HY2 FYXX
Refers to the 6 months starting on
1 January 20XX and ending on 30 June
20XX, where XX is the two-digit number
for the year.
HMM
Hotazel Manganese Mines.
ICMM
ICMM, previously referred to as the
International Council on Mining and
Metals, is an international organisation
that leads through collaboration to
enhance the contribution of mining and
metals to sustainable development. As
a corporate member, South32 commits
to implementing and reporting on the
ICMM Mining Principles, Performance
Expectations and mandatory
requirements set out in the Position
Statements, which define environmental,
social and governance requirements.
IMC
Illawarra Metallurgical Coal.
Indicated Mineral Resource
That part of a Mineral Resource for which
quantity, grade (or quality), densities,
shape and physical characteristics are
estimated with sufficient confidence.
This allows the application of Modifying
Factors in sufficient detail to support mine
planning and evaluation of the economic
viability of the deposit (JORC Code).
Indigenous, Traditional and Tribal
Peoples
We use the defined term ‘Indigenous,
Traditional and Tribal Peoples’ as per the
We use the defined term ‘Indigenous,
Traditional and Tribal Peoples’ as per the
definition and guidance set out in the
Indigenous and Tribal Peoples Convention,
1989 (No. 169). We use this term inclusively
to encompass the diversity of worldwide
Indigenous, Traditional and Tribal Peoples,
including but not limited First Nations,
Native Americans, Traditional Owners,
Aboriginal and Torres Strait Islander
Peoples and other land connected
communities. We recognise that no single
definition can fully capture the diversity of
Indigenous, Traditional and Tribal Peoples.
Inferred Mineral Resources
That part of a Mineral Resource for
which quantity and grade (or quality)
are estimated on the basis of limited
geological evidence and sampling.
Geological evidence is sufficient to imply
but not verify geological and grade (or
quality) continuity (JORC Code).
Injury
An occupational injury occurs during a
single work shift or a single exposure
to an agent(s) causing an acute toxic
effect, which can be identified by time
and place resulting from direct contact
with an object following an instantaneous
event. Examples include cut, puncture,
laceration, abrasion, fracture, bruise,
contusion, chipping tooth, amputation,
insect bite, electrocution, or a thermal,
chemical, electrical or radiation burn.
Sprain and strain injuries to muscles joints
connective tissue are classified as injuries
when they result from a slip, trip, fall or
other similar accidents.
International Financial Reporting
Standards (IFRS)
Accounting standards as issued by the
IASB (International Accounting Standards
Board).
JORC
Joint Ore Reserves Committee comprising
representatives of The Australasian
Institute of Mining and Metallurgy
(AusIMM), Australian Institute of
Geoscientists (AIG) and Minerals Council
of Australia (MCA) as well as the Australian
Securities Exchange (ASX), the Financial
Services Institute of Australasia (FinSIA)
and the accounting profession.
JORC Code
The Australasian Code for reporting of
Exploration Results, Mineral Resources
and Ore Reserves 2012 Edition prepared
by the JORC.
JSE
Johannesburg Stock Exchange.
Just transition
The concept of a just transition reflects the
imperative of managing the social impacts,
risks and opportunities of the transition
to a low-carbon world. It is an approach to
decarbonisation that seeks to centre the
interests of those that are most affected
by it, including workers, communities, and
suppliers of goods and services.
KMP
Key management personnel are people
who have authority and responsibility for
planning, directing and controlling the
activities of South32 either directly or
indirectly.
Laterite
A residual soil or deposit formed by the
leaching of silica from rocks under specific
climatic conditions.
Leaching
The process by which a soluble metal can
be economically recovered from minerals
in ore by dissolution.
Lead Team
All Chief positions within South32.
Life of Operation Plan
The combination of an Optimised Base
Plan and incremental opportunities
available to the operation for maximising
value. Mining related terms continued
Marketable Coal Reserves Represents
beneficiated or otherwise enhanced
coal product where modifications due to
mining, dilution and processing have been
considered (JORC Code).
LME
London Metal Exchange.
Local procurement
Local procurement is the direct purchase
of goods and services within the local
communities in which South32 operates.
Suppliers are deemed as local based on
their proximity to our local communities,
including boundaries defined by local
government areas, provinces and states.
Lost time injury
The sum of work-related (fatalities
+ injuries that caused permanent
impairment >30 per cent of body + lost
time injuries). Lost time injuries include
injuries that result in one or more lost work
day after the day of the event.
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.
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SOUTH 32 ANNUAL REPORT 2024
Low-carbon
Refers to 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.
Low-carbon aluminium
Aluminium produced in a process that
results in less than 4t CO
2
-e Scope 1 and
Scope 2 GHG emissions per tonne of
aluminium.
LSE
London Stock Exchange.
LTI
Long-term incentive.
Management roles
Leadership positions filled by employees,
identified either by job grading (Level 13 or
higher) or by the requirements associated
with their role.
Margin on third party products
Comprises Underlying EBIT on third
party products and services, divided
by underlying revenue on third party
products and services.
Marketable Coal Reserves
Represents beneficiated or otherwise
enhanced coal product where
modifications due to mining, dilution and
processing have been considered (JORC
Code).
Material Health Exposures
Material health exposures include
potential exposure to carcinogens and
airborne contaminants.
Material sustainability topic
Topic that reflects a reporting
organisation’s significant economic,
environmental, and social impacts or that
substantively influences the assessments
and decisions of stakeholders.
MAusIMM
Member of the Australasian Institute of
Mining and Metallurgy.
MAusIMM (CP)
Accredited Chartered Professional
status of members of the AusIMM.
These members have undergone an
assessment of their competencies,
which are maintained through continuing
professional development activities.
Measured Mineral Resource
That part of a Mineral Resource for which
quantity, grade (or quality), densities,
shape and physical characteristics are
estimated with confidence sufficient to
allow the application of Modifying Factors
to support detailed mine planning and
final evaluation of the economic viability of
the deposit (JORC Code).
Metallurgical coal
A broader term than coking coal that
includes all coals used in steelmaking,
such as coal used for the pulverised coal
injection process.
Mineral Resource
A concentration or occurrence of solid
material of economic interest in or on
the Earth’s crust in such form, grade
(or quality), and quantity that there
are reasonable prospects for eventual
economic extraction. The location,
quantity, grade (or quality), continuity
and other geological characteristics of a
Mineral Resource are known, estimated
or interpreted from specific geological
evidence and knowledge, including
sampling. Mineral Resources are sub-
divided, in order of increasing geological
confidence, into Inferred, Indicated and
Measured categories (JORC Code).
Mineralisation
Any single mineral or combination of
minerals occurring in a mass, or deposit, of
economic interest (JORC Code).
Modern slavery
The term modern slavery is used to
describe situations where coercion,
threats or deception are used to exploit
victims and undermine or deprive them
of their freedom. As defined by the
Australian Modern Slavery Act 2018 (Cth)
modern slavery include eight types of
serious exploitation: trafficking in persons;
slavery; servitude; forced marriage;
forced labour; debt bondage; deceptive
recruiting for labour or services; and the
worst forms of child labour. The worst
forms of child labour means situations
where children are subjected to slavery or
similar practices, or engaged in hazardous
work.
Modifying Factors
Considerations used to convert
Mineral Resources to Ore Reserves.
These include, but are not restricted
to, mining, processing, metallurgical,
infrastructure, economic, marketing, legal,
environmental, social and governmental
factors (JORC Code).
MRN
Mineração Rio do Norte.
Nature positive
A high-level goal and concept describing
a future state of nature (e.g., biodiversity,
ecosystem services and natural capital)
that is greater than the current state.
Net cash
Comprises cash and cash equivalents
less interest-bearing liabilities.Net debt
Comprises interest bearing liabilities less
cash and cash equivalents.
Net operating assets
Represents operating assets net of
operating 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.
Net zero
Net zero greenhouse gas emissions are
reached when anthropogenic emissions of
greenhouse gases to the atmosphere are
balanced by anthropogenic removals over
a specified period.
No net loss
The impacts on biodiversity caused as a
result of a development project/activities
are balanced (so that no net loss remains)
by rigorous application of the mitigation
hierarchy:
– Avoid
– Minimise and mitigate negative
impacts;
– Rehabilitate or restore affected areas;
and
– Offset the residual impacts.
Non-operated joint ventures
Operations which are not wholly owned
by South32 Limited or its subsidiaries and
for which South32 does not manage the
operation, being Brazil Alumina, Brazil
Aluminium, Sierra Gorda S.C.M, Ambler
Metals, Mineração Rio do Norte S.A (MRN)
and Port Kembla Coal Terminal (PKCT).
Details of South32's ownership interest
can be found on page 56 to 66 of this
report, except for Ambler Metals in which
a 50 per cent interest is held and PKCT in
which a 16.67 per cent interest is held.
Net smelter return
An estimate of revenue derived from
the sale of products and concentrates
following the application of metallurgical
recoveries and deducting transport costs,
treatment and refining charges, penalties
and royalties. For Sierra Gorda, mining
cost is also included in the calculation.
Glossary of terms and abbreviations continued
194
SOUTH 32 ANNUAL REPORT 2024
Occupational Exposure Limit (OEL)
The concentration of a substance or
agent, exposure to which, according to
current knowledge, should not cause
adverse health effects nor cause undue
discomfort to nearly all workers.
Occupational illness
An occupational illness is any abnormal
condition or disorder, other than one
resulting from an occupational injury,
caused or aggravated by exposures to
factors associated with employment.
It includes acute or chronic illnesses
or diseases which may be caused by
inhalation, absorption, ingestion, or direct
contact.
Operated joint ventures
Operations which are not wholly owned
by South32 Limited or its subsidiaries and
for which South32 manages the operation,
being, Australia Manganese, South Africa
Manganese, Mozal Aluminium, Eagle
Downs Metallurgical Coal and Chita Valley.
Details of South32's ownership interest
can be found on page 56 to 66 of this
report, except for Chita Valley in which a
50.1 per cent interest is held.
Operational GHG emissions
Scope 1 and 2 GHG emissions from our
operated assets.
Operational Leadership Team
All General Managers and Managers
reporting to Vice President Operations
including Functional Managers such as
Human Resources, Finance and Supply,
etc. (limited to one per function).
Ore Reserve
The economically mineable part of a
Measured and/or Indicated Mineral
Resource. It includes diluting materials and
allowances for losses, which may occur
when the material is mined or extracted
and is defined by studies at Prefeasibility
or Feasibility level as appropriate that
include application of Modifying Factors.
Such studies demonstrate that, at the time
of reporting, extraction could reasonably
be justified (JORC Code).
Our people
As defined in our Code of Business
Conduct, our people includes South32
Directors, executive management,
employees and contractor staff.
Paris Agreement
A legally binding international treaty on
climate change that aims to bring all
nations into a common cause to undertake
ambitious efforts to combat climate
change and adapt to its effects, with
enhanced support to assist developing
countries to do so.
Payable copper equivalent production
(kt)
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$24.8/
oz) have been used for FY24, FY25e and
FY26e. FY23 realised prices for copper
(US$3.51/lb), molybdenum (US$21.28/lb),
gold (US$1,821/oz) and silver (US$21.9/oz)
have been used for FY23 and FY24.
Payable zinc equivalent (kt)
Calculated by aggregating revenues from
payable silver, lead and zinc, and dividing
the total Revenue by the price of zinc.
FY24 realised prices for zinc (US$2,230/t),
lead (US$2,002/t) and silver (US$24.8/
oz) have been used for FY24, FY25e
and FY26e. FY23 realised prices for zinc
(US$2,151/t), lead (US$1,919/t) and silver
(US$21.1/oz) have been used for FY23 and
FY24.
Probable Ore Reserve
The economically mineable part of an
Indicated and, in some circumstances,
a Measured Mineral Resource. The
confidence in the Modifying Factors
applying to a Probable Ore Reserve is
lower than that applying to a Proved Ore
Reserve (JORC Code).
Proved Ore Reserve
The economically mineable part of a
Measured Mineral Resource. A Proved
Ore Reserve implies a high degree of
confidence in the Modifying Factors (JORC
Code).
Recordable Illnesses
The sum of work-related (fatalities
+ illnesses that caused permanent
impairment >30 per cent of body + lost
time illnesses + restricted work illnesses +
medical treatment illnesses)
Recordable injuries
The sum of work-related (fatalities
+ injuries that caused permanent
impairment >30 per cent of body + lost
time injuries + restricted work injuries +
medical treatment injuries).
Reserve Life
The scheduled extraction period in years
for the Total Ore Reserves in the approved
Life of Operation Plan.
Return on invested capital (ROIC)
Calculated as Underlying EBIT less the
discount on rehabilitation provisions
included in 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 impairment reversal of Brazil
Aluminium, and unproductive capital) and
inventories
ROM (Run of Mine product)
Product mined in the course of regular
mining activities.
RPO (Recognised Professional
Organisation)
Accredited organisations to which
Competent Persons must belong for
the purpose of preparing reports on
Exploration Results, Mineral Resources
and Ore Reserves for submission to
the ASX (if they are not members of
the AusIMM or AIG). Chilean Mining
Commission is one of the RPO. (JORC
Code)
SAEC
South Africa Energy Coal.
SAIMM
Member of the Southern African Institute
of Mining and Metallurgy.
‘Safety guarantee’
Our ‘safety guarantee’ is our internal
approach to creating a sense of chronic
unease to enhance our safety culture.
Every day, we ask our people to reflect on
whether they can guarantee both their
safety and that of their colleagues when
executing their role. If the answer is no,
then the challenge is to stop and ask
what would need to be done differently to
provide that guarantee.
Sands
Tailings produced as a by-product during
beneficiation of ore.
Scope 1 emissions
GHG emissions from our own operations,
including the electricity we generate at
our sites.
Scope 2 emissions
Indirect GHG emissions from the
generation of purchased electricity.
Scope 3 emissions
All other indirect GHG emissions not
included in Scope 2 emissions that occur
in our value chain.
Senior Leadership Team
Presidents and Vice Presidents reporting
to members of the South32 Lead Team
and the Company Secretary.
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SOUTH 32 ANNUAL REPORT 2024
Significant hazards 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.
SMMEs
Small, medium and micro enterprises.
Social investment
Contributions made to support
communities where we operate or have an
interest. Our contributions to community
programs comprise direct investment
(including Enterprise Development), in-
kind support and administrative costs.
South32 Equity Incentive Plan
An equity incentive plan that allows the
Board to make offers to employees to
acquire securities in South32 Limited and
to otherwise incentivise employees.
South32, South32 Group or Group
Refers to South32 Limited and its
subsidiaries and operated joint ventures,
unless otherwise stated.
Stockpile (SP)
An accumulation of ore or mineral built
up when demand slackens or when
the treatment plant or beneficiation
equipment is incomplete or temporarily
unable to process the mine output; any
heap of material formed to create a buffer
for loading or other purposes, or material
dug and piled for future use.
STI
Short-term incentive.
Supply chain
The global network of suppliers
that support South32’s operations,
development options and exploration
programs through the flow of goods,
services and information.
Sustainability, sustainable development,
sustainably, sustainable
Our approach to sustainability aims
to balance environmental, social and
economic considerations in a way
that creates enduring value for our
stakeholders. We recognise that in
many cases these considerations will
be interdependent or may compete or
conflict with each other. In delivering
our strategy we aim to understand and
balance the environmental, social and
economic impacts of our business in a
way that seeks to create value overall.
References to sustainability (including
sustainable development and sustainably)
in the suite or other disclosures do not
mean that there will be no adverse impact,
or an absolute outcome, in any one area.
Tailings
The left-over materials that remain after
the target mineral is extracted from ore.
Target
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.
TSF
Tailings Storage Facility
Taskforce on Climate-Related Financial
Disclosures (TCFD)
The TCFD developed a framework for
climate-related financial disclosures,
including a set of recommended
disclosures structured around the four
recommendation pillars of governance,
strategy, risk management, and metrics
and targets. The TCFD was disbanded
in October 2023 and the International
Sustainability Standards Board will
monitor progress on the state of climate-
related financial disclosures by companies.
Taskforce on Nature-Related Financial
Disclosures (TNFD)
The TNFD has developed a framework for
nature-related disclosures, including a set
of disclosure recommendations structured
around the four recommendation pillars
of governance, strategy, risk and impact
management, and metrics and targets.
TEMCO
Tasmanian Electro Metallurgical Company
Total Mineral Resources
The sum of Inferred Mineral Resources,
Indicated Mineral Resources and
Measured Mineral Resources.
Total Ore Reserves
The sum of Proved Ore Reserves and
Probable Ore Reserves.
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.
Total Recordable Illness Frequency
(TRILF)
(The sum of recordable illnesses
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.
Total Shareholder Return (TSR)
TSR measures the return delivered
to shareholders over a certain period
through the change in share price and
any dividends paid. It is a measure used
to compare our performance to that of
relevant peer groups under the LTI.
Transformation
A national strategy in South Africa aimed
at attaining national unity, promoting
reconciliation through negotiated
settlement and non-racism.
TSX
Toronto Stock Exchange.
Underlying earnings
Underlying earnings is profit after tax
and earnings adjustment items. Earnings
adjustments represent items that don’t
reflect our underlying operations. We
believe that Underlying earnings provides
useful information, but shouldn’t be
considered as an indication of, or an
alternative to, profit or attributable profit
as an indicator of operating performance.
Underlying earnings attributable to
members
Underlying earnings attributable to
members is profit after tax attributable to
members and earnings adjustment items.
Earnings adjustments represent items that
don’t reflect our underlying operations.
We believe that Underlying earnings
provides useful information, but shouldn’t
be considered as an indication of, or an
alternative to, profit or attributable profit
as an indicator of operating performance.
Underlying EBIT
Underlying EBIT is profit before net
finance costs, tax and after any earnings
adjustment items, impacting profit.
The underlying information reflects
the Group’s interest in material equity
accounted joint ventures and is presented
on a proportional consolidation basis. It
is not an IFRS measure of profitability,
financial performance or liquidity and
may be defined and used in differing
ways by different entities. We believe
that Underlying EBIT provides useful
information, but should not be considered
as an indication of, or alternative to, profit
or attributable profit as an indicator of
operating performance.
Underlying EBIT margin
Comprises Underlying EBIT excluding third
party product EBIT, divided by underlying
revenue excluding third party product
revenue.
Underlying EBITDA
Underlying EBIT before underlying
depreciation and amortisation.
Glossary of terms and abbreviations continued
196
SOUTH 32 ANNUAL REPORT 2024
Underlying effective tax rate (ETR)
Underlying income tax expense, including
royalty related tax, divided by Underlying
profit subject to tax.
UG
Underground working in which the working
area is below the surface of the earth.
UN SDGs
United Nations Sustainable Development
Goals.
Water scarcity
Water scarcity refers to the lack of
sufficient available water to meet the water
usage demands of the region. This can be
from the lack of physical water and the lack
of financial means to gain access to water.
Water use efficiency
Water use efficiency is calculated as the
total water recycled and reused divided by
the sum of total water recycled and reused
and total operational inputs/withdrawal.
Yield
The percentage of material of interest
that is extracted during mining and/
or processing. A measure of mining or
processing efficiency (JORC Code). When
used in reference to the Mineral Resource
estimate yield refers to the sample mass
recovery following beneficiation.
Terms used in resources and
reserves
A.Al₂O₃
available alumina
Ag
Silver
Au
Gold
Cu/TCu
Copper/ total copper
Fe
iron
Met
metallurgical coal
Mn
manganese
Mo
molybdenum
Ni
nickel
OC
open-cut/open-pit/opencast
Pb
lead
R.SiO₂
reactive silica
S
sulphur
Th
thermal coal
VM
Volatile Matter
Zn
zinc
Units of measure
%
percentage or per cent
A$/t
Australian dollars per tonne
CuEq
copper equivalent
dmtu
dry metric tonne unit
g/t
grams per tonne
ha
hectare
Kcal/kg
thousand calories per kilogram
kdmt
thousand dry metric tonne
kL
kilolitre
km
kilometre
koz
thousand ounces
ktpa
kilotonnes per annum
kt
kilotonnes (metric)
kW
kilowatt
kwmt
thousand wet metric tonnes
lb
pound
ML
megalitre
m
metre
Moz
million ounces
Mt
million metric tonnes
Mtpa
Million metric tonnes per annum
Mwmt
million wet metric tonnes
MW
megawatt
oz
ounce
t
Metric tonne
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SOUTH 32 ANNUAL REPORT 2024
tpa
Metric tonnes per annum
tpd
Metric tonnes per day
tph
Metric tonnes per hour
US$B
US dollars in billions
US$/lb
US dollars per pound
US$M
US dollars in millions
US$/oz
US dollars per ounce
US$/t
US dollars per tonne
Glossary of terms and abbreviations continued
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SOUTH 32 ANNUAL REPORT 2024
Corporate directory
Group Headquarters
108 St Georges Terrace
Perth WA 6000
Australia
Telephone: +61 8 9324 9000
Facsimile: +61 8 9324 9200
Email: Company.Secretary@south32.net
South Africa Office
39 Melrose Boulevard
Melrose Arch
Melrose, Johannesburg 2076
South Africa
Telephone: +27 11 376 2000
Singapore Marketing Office
16 Collyer Quay
#18-00, Collyer Quay Centre
Singapore 049318
Singapore
Telephone: +65 6679 2600
London Marketing Office
Nova North
11 Bressenden Place
London SW1E 5BY
United Kingdom
Telephone: +44 20 7798 1700
North America Office
1066 West Hastings Street
Vancouver V6E 3X1
British Colombia
Canada
Telephone: +1 604 915 5680
Share Registrars and Transfer Offices
Contact details for the Company’s share registries in Australia,
South Africa and the United Kingdom are included on page 190.
Information about the American Depositary Receipts Depositary,
Transfer Agent and Registrar can also be found on page 190.
Printed copies of this Annual Report will only be posted to
those shareholders who have requested a printed copy. Other
shareholders are notified when the Annual Report becomes
available and given details of where to access it electronically.
OPERATING AND FINANCIAL REVIEW GOVERNANCE FINANCIAL REPORT RESOURCES AND RESERVES INFORMATION
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SOUTH 32 ANNUAL REPORT 2024
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SOUTH 32 ANNUAL REPORT 2024
This Annual Report is printed on paper that is
FSC
®
(Forest Stewardship Council) certified and
manufactured from plantation-grown timber.
Both the paper manufacturer and printer are certified
to the highest possible internationally recognised
standard for environmental management.
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