South32 Ltd said on Thursday it is optimistic about its future now that it has undergone a ‘major transformation’ to become a diversified mining group.

Speaking to South32’s annual general meeting on Thursday, Chair Karen Wood said the Perth-based mining house has identified and executed opportunities to ‘reshape’ its business.

‘The changes we have made to date - and the investments we are continuing to make in our portfolio - are expected to support significant production growth,’ Wood told shareholders in a hybrid meeting.

South32, she said, continues to be excited by its Hermosa project in the US state of Arizona, which presents a ‘significant’ opportunity for decades to come.

Hermosa consists of the Taylor zinc-lead-silver deposit, Clark zinc-lead-silver deposit, and a regional exploration land package.

At the AGM, Chief Executive Graham Kerr said South32 continues to see substantial opportunity to unlock additional value at Hermosa. Kerr said this optionality is not included in the impairment assessment.

Back in August, with the release of its annual results, South32 said it had taken a $1.30 billion impairment charge related to Hermosa project for the financial year that ended June 30, compared to just $145 million the year before.

Kerr on Thursday said South32 continues to invest to discover its next generation of base metals mines. It has more than 25 exploration programmes underway in targeted regions including Alaska, Argentina and Australia.

Kerr said portfolio improvements at South32 are expected to deliver further growth in commodities critical for a low-carbon future.

The mining group expects Sierra Gorda in Chile to increase its future copper production, as a result of the plant de-bottlenecking project and it has advanced studies for the fourth grinding line expansion, which could lift copper throughput by 15% to 20%.

In the recently completed financial year, revenue fell by 20% to $7.43 billion from $9.27 billion, as a result of lower commodity prices. Underlying earnings before interest, tax, depreciation and amortisation slumped by 47% to $2.53 billion from $4.76 billion, reflecting lower commodity prices.

South32 slashed its final dividend to 3.2 US cents from 14.5 cents, dragging the total payout for the year down to 8.1 cents from 22.7 cents.

On Monday this week, South32 had reported that production at its operations was mixed as it battled against mounting inflationary pressures, forcing the miner into a scramble to keep costs under control. It left annual production guidance for the 2024 financial year unchanged across all operations.

Alumina production at Worsley is guided at 4.00 million tonnes in financial 2024, up from 3.83 million in financial 2023. The financial 2025 forecast also is for 4.00 million tonnes. In 2022, output was 3.99 million tonnes.

Brazil Alumina production is estimated at 1.40 million tonnes in 2024 and 1.42 million in 2025, up from 1.26 million in 2023. Production was 1.29 million tonnes in 2022.

Hillside aluminium production rose to 719,000 tonnes in 2023 from 714,000 in 2022. Output is forecast to be 720,000 tonnes in both 2024 and 2025. Mozal aluminium output climbed to 345,000 tonnes in 2023 from 278,000 in 2022. It is guided to rise to 365,000 tonnes in 2024 and 372,000 in 2025.

Payable copper production is expected to drop to 67,000 tonnes in 2024 before rising to 71,000 in 2025, South32 said. Copper output was 70,700 tonnes in 2023, up sharply from 25,300 in 2022.

Total coal production was 6.52 million tonnes in 2023, slightly higher than 6.50 million in 2022. Output is expected to amount to 5.00 million tonnes in both 2024 and 2025.

Metallurgical coal production is likely to drop from 5.49 million tonnes in 2023 to an estimated 4.40 million in 2024 and 4.70 million in 2025, South32 said. In 2022, production was 5.71 million tonnes.

Manganese ore production is estimated at 2.0 million wet tonnes in 2024. Output rose to 2.1 million wet tonnes in 2023 from 2.0 million in 2022.

Shares in South32 were up 0.4% to R 39.57 on Thursday morning in Johannesburg, and were up 0.7% to 171.20 pence in London. The stock had closed down 0.3% at A$3.24 in Sydney.

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