Company news: South32
South32 also released its quarterly report for period ending Jun-16. In summary, production was meeting or exceeding FY-16 guidance at the majority of operations and energy coal was ~3% lower than guidance.
Pleasingly, restructuring at five operations previously announced by the company - including Worsley Alumina, Illawarra Metalurgical Coal, Australia and South Africa Manganese, and Cerra Matoso - have been completed. Therefore, production costs for these operations are on track to be reduced to the FY-17 guidance levels.
The company is also potentially becoming involved in a Copper-Nickel-Platinum opportunity in Northern Canada, after signing an option agreement. Given South32's strong balance sheet (no net debt), we welcome the pursuit of financially sound acquisitions and developments at this stage of the cycle.