South32 Ltd said on Monday market conditions had improved as it entered the second half of its financial year after delivering mixed production performance in the first six months.

Shares in South32 dropped 0.9% to R 40.15 on Monday morning in Johannesburg, and were down 1.6% to 164.40 pence in London.

The Perth-based diversified mining group said copper production dropped 17% to 31.6 million tonnes for the six six months that ended December 31 from 37.9 million tonnes a year earlier. For the second quarter, output declined 17% to 15.6 million tonnes from 18.9 million tonnes in the same quarter a year before. But production was down 2.5% from 16.0 million tonnes in the first quarter.

Alumina production eased 1% to 2.57 million tonnes from 2.61 million tonnes. Output fell 5.3% to 1.28 million tonnes on an annual basis in the second quarter from 1.35 million tonnes. On-quarter, production edged down 0.7% from 1.29 million tonnes.

In the first half, aluminium production rose slightly 1% to 575,000 tonnes from 568,000 tonnes. Output in the second quarter was down 0.7% to 287,000 tonnes on-year from 289,000 tonnes, while fell marginally 0.3% from 288,000 tonnes quarter-on-quarter.

Metallurgical coal production slumped 35% to 1.78 million tonnes from 2.75 million tonnes. Annually, production for the second quarter halved to 744,000 tonnes from 1.48 million tonnes. On the quarter, decreased 29% from 1.04 million tonnes.

Manganese ore production in the first six months was 5% lower at 2.79 million wet tonnes from 2.94 million wet tonnes. Output declined 14% to 1.27 million wet tonnes year-on-year from 1.47 million wet tonnes, while quarterly production fell 16% from 1.52 million wet tonnes.

Silver production in the first six months rose 20% to 5.81 million ounces from 6.99 million ounces. In the second quarter, output jumped 18% to 3.62 million ounces on-year from 3.06 million ounces, and was 7% higher at 3.37 million ounces.

First-half nickel production declined 10% to 18,300 tonnes from 20,400 tonnes. For the second quarter, annual output was flat 10,000 tonnes versus 10,800 tonnes, while production rose 20% from 8,300 on quarter.

Lead production was up 12% to 58,800 tonnes in the first half from 52,400 tonnes.In the second quarter, output was up 8.9% to 30,300 tonnes from 27,800 tonnes, and rose 6% on-quarter from 28,500 tonnes.

Zinc output over first half fell 5% to 29,000 tonnes from 30,400 tonnes. Second-quarter production declined 3.6% to 15,800 tonnes annually from 16,400 tonnes. quarterly, production grew 20% from 13,200 tonnes.

South32 expects operating unit costs to be in line or below for the 2024 guidance.

‘As we enter the second half, strengthening market conditions for many of our commodities, our planned 7% production growth and ongoing cost management focus, position us well to capture higher margins,’ Chief Executive Officer Graham Kerr said.

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