South32 posted a 2 percent rise in first quarter copper production on Monday, helped by mining higher grade ore as planned, but the result came in slightly below market expectations and the shares fell. Payable copper production from the company’s 45 percent share of the Sierra Gorda mine in Chile was 18,700 tonnes for the quarter ended September 30, up from 18,300 tonnes a year earlier and below the 19,200 tonne Visible Alpha consensus reported by Reuters. Payable copper equivalent production at Sierra Gorda was 22,400 tonnes, up 11 percent on the June quarter as higher grades offset temporary wet weather. South32 shares closed 2.59 percent lower at 4.51 Australian dollars in Sydney.
Full year guidance was maintained across all operations, including Sierra Gorda payable copper equivalent guidance of 91,800 tonnes and Cannington zinc equivalent guidance of 290,000 tonnes for the year to June 2027. Sierra Gorda has begun work on a fourth grinding line expected to lift processing capacity by about 25 percent, and paid a record quarterly distribution, reported at 153 million US dollars by Reuters coverage. South32 ended the quarter with net cash of 297 million US dollars.
The weak point was Cannington, the Queensland silver, lead and zinc mine, where payable zinc equivalent production fell 27 percent from the June quarter to 59,200 tonnes. A temporary reduction in paste backfill availability delayed access to planned stopes, and the mine processed lower grade stockpiles to keep the mill fed. The company expects paste system upgrades to support higher mining rates over the rest of the year.
Elsewhere in the portfolio, Australia Manganese saleable production rose 15 percent quarter on quarter to 902,000 wet metric tonnes as conditions improved after the wet season, and Worsley Alumina production rose 2 percent to 966,000 tonnes. At the Hermosa project in Arizona, both shafts are expected to reach the primary production level in the December quarter. Shareholders approved the sale of the aluminium value chain assets to Alcoa on October 15, a transaction still on track to complete in the second half of the 2027 financial year, which will leave South32 as an upstream base metals business built around copper and zinc.