Highlights

  • Underlying earnings increased 16% to USD 435 million, while underlying revenue rose 4% to USD 4.008 billion.
  • Key projects advanced: Hermosa construction progressed, Cannington underground ore reserves increased 28%, and Sierra Gorda studies for future expansion continued.
  • Fully-franked interim dividend announced at US 3.9 cents per share, with a capital management program raised to USD 2.6 billion.

South32 Ltd (ASX:S32) reported its half-year results for H1 FY26, showing a 16% increase in underlying earnings to USD 435 million and announcing a fully-franked interim dividend of US 3.9 cents per share. Despite a slight decline in revenue from continuing operations, the company highlighted growth across its base and precious metals portfolio and advanced key mining projects, including Hermosa and Cannington.

Revenue Slightly Down, Underlying Profit Climbs

South32 recorded revenue from continuing operations of USD 2.809 billion, down 3% from USD 2.884 billion in H1 FY25. The decline reflected divestments of Illawarra Metallurgical Coal and Cerro Matoso, classified as discontinued operations.

However, underlying revenue rose 4% to USD 4.008 billion, while underlying earnings attributable to members grew 16% to USD 435 million. Profit after tax attributable to members increased 29% to USD 464 million, demonstrating the impact of higher base and precious metals prices.

Net tangible assets per share increased to USD 2.02, up from USD 1.93 in June 2025, providing additional capital flexibility.

Base Metals and Project Developments Drive Growth

South32 highlighted ongoing progress in key mining operations. At Hermosa, construction continued on the large-scale Taylor zinc-lead-silver project, with exploration yielding positive results from the Peake copper deposit.

Cannington reported a 28% increase in underground ore reserves, with further potential identified for both underground and open-pit expansion. Sierra Gorda advanced studies for a fourth grinding line and exploration at Catabela Northeast, underlining opportunities to extend mine life.

Mozal Aluminium will move to care and maintenance in March 2026 due to electricity supply constraints, with management working closely with stakeholders on the transition.

Capital Management and Dividend

South32 confirmed an unchanged FY26 capital expenditure guidance of USD 1.4 billion, with USD 750 million allocated to Hermosa growth projects. Expenditure for Environmental, Asset, and Infrastructure (EAIs) projects rose slightly to USD 325 million, primarily for Sierra Gorda and manganese operations in Australia and South Africa.

The company announced a fully-franked interim dividend of US 3.9 cents per share, equivalent to USD 175 million, with a record date of 6 March 2026 and payment date of 2 April 2026. The capital management program has been increased to USD 2.6 billion, with USD 209 million remaining for shareholder returns.

Outlook

South32 maintains FY26 production and operating cost guidance across its operated businesses. Focus remains on growing base metals production, completing Hermosa development, and extending the life of existing assets, while maintaining safe and reliable operations.

Despite a slight decline in reported revenue, South32’s underlying earnings and strategic project developments indicate growth momentum. The combination of dividends, capital management initiatives, and ongoing mining expansions positions the company to maintain operational and financial progress into the second half of FY26.

FAQ

  1. What was South32’s underlying earnings for H1 FY26?
    Underlying earnings rose 16% to USD 435 million.
  2. What dividend did South32 declare?
    The company announced a fully-franked interim dividend of US 3.9 cents per share.
  3. Which projects are driving South32’s growth?
    Key growth drivers include Hermosa (Taylor zinc-lead-silver), Cannington (ore reserve expansion), and Sierra Gorda (future copper production studies).