Binding bids for SA Energy Coal expected by end-June, says South32
The diversified miner will remain invested in SA through its manganese and aluminium smelting operations
Plans to sell-off South African Energy Coal are progressing and binding bids for the business are expected in the first half of the year, global diversified mining company South32 said in a quarterly report on Thursday.
The company announced its intention to sell off the coal division in late 2017, with the aim of transforming the shareholding of the company, in line with its commitment to economic transformation. A majority black-owned South African Energy Coal is expected to open up more opportunities for the company.
Once the coal division is spun off, South32 will still remain invested in SA through its South Africa Manganese operation and its Hillside Aluminium smelter. South32 itself was formed from a spin-off of BHP Billiton assets in 2015.
In a quarterly report for the three months ended December 2018, released on Thursday, the company reported strong production for the period. Guidance for the full-year, which ends in June, remains unchanged — with the exception of its Illawarra Metallurgical Coal operation in Australia where production is up 7% on the company’s previous estimate.
South32 noted premium ore production from South Africa Manganese, which offset a decline in fine-grained secondary products. It also maintained saleable aluminum production “despite an increase in the frequency of load-shedding events” at its Hillside Aluminium and Mozal Aluminium smelters during the December 2018 half year.
A lift in commodities prices also boosted the company.
“As we have benefited from strong prices for our core commodities we have continued to return cash to shareholders,” said South32 CEO Graham Kerr. “In the December 2018 half-year we distributed $316m in dividends and allocated$167m to our on-market share buy-back.”
The company also announced changes to its leadership team on Thursday. Katie Tovich will replace Brendan Harris as CFO. Harris will take over from Peter Finnimore as chief marketing officer.