Australian metals miner South32 noted in a quarterly filing that its production of aluminium and other minerals were on par with expectations, but it saw an impact on working capital thanks to an inventory build-up due to shipping delays.
The fourth quarter of 2022 had South32 meeting production forecasts of aluminium, coal, and copper while edging slightly the production expectations of manganese ore.
“While production was inline, sales were impacted, leading to weaker-than-expected cash generation,” noted Barrenjoy analyst Glyn Lawcock in remarks about South32’s results.
However, a lag in shipments at the year’s close cost the firm about US$100 million in working capital. South32 said in a statement that its aluminium sales bore the brunt of the impact.
“This impact is most acute in our aluminium value chain in Southern Africa due to ongoing shipping delays.”
South32 said production in 2023 would be off by about one quarter in Brazil thanks to a delay in its in-country aluminium smelter’s delay in ramping up production until last fall.
The firm also relayed news of the two fatalities at its Mozal Aluminium plant in November.
Despite the challenges last year, South32 predicted operating unit costs for the front half of 2023 at or below already-forecast levels at most plants.
Based in Perth, Western Australia, South32 began in 2015 as a spin-off of BHP Billiton. The firm operates mines in Australia, South America, and South Africa, and markets bauxite, alumina, aluminium, copper, silver, lead, zinc, nickel, metallurgical coal, and manganese.
