The South32 Ltd (ASX: S32) share price has started the week in a positive fashion.
In morning trade the mining giant’s shares are up almost 3% to $2.17.
Why is the South32 share price pushing higher?
Investors have been buying South32’s shares on Monday following the release of its first quarter update this morning.
For the quarter, the company achieved alumina production of 1,315kt, aluminium production of 248kt, manganese ore production of 1,461kt, and metallurgical coal production of 1,651kt.
As a comparison, a note out of Goldman Sachs reveals that it was expecting production of 1,328kt, 248kt, 1,302kt, and 1,650kt, respectively. While this means it alumina production fell slightly short of expectations, its manganese made up for this with significantly better than forecast production.
This ultimately led to South32 delivering a US$70 million increase in its net cash position over the three months to US$368 million. This was despite a build in working capital as commodity markets improved.
Share buy-back to resume.
Pleasingly for shareholders, this strong operating performance and the further strengthening of its financial position, has allowed South32 to lift its on-market share buy-back suspension.
Its US$1.43 billion capital management program is 92% complete with US$121 million remaining to be returned to shareholders.
South32’s CEO, Graham Kerr, was very pleased with the quarter, particularly given the challenges it faces from operating in the current environment.
He commented: “Despite the health crisis, we have maintained annual production guidance at all operations. We delivered a 19 per cent increase in manganese ore production and a 22 per cent increase in metallurgical coal production.”
“With another quarter of strong operating performance behind us and the further strengthening of our financial position, we have lifted the suspension of our on-market share buy-back. Our capital management program has US$121 million remaining and recommencing our buy-back will deliver immediate value to our shareholders,” Mr Kerr concluded.
Forget what just happened. We think this stock could be Australia’s next MONSTER IPO…
One little-known Australian IPO has doubled in value since January, and renowned Australian Moonshot stock picker Anirban Mahanti sees a potential millionaire-maker in waiting…
Because ‘Doc’ Mahanti believes this fast-growing company has all the hallmarks of genuine Moonshot potential, forget ‘buy now pay later’, this stock could be the next hot stock on the ASX.
See how you can find out the name of this stock
Returns as of 6th October 2020
More reading
- 5 things to watch on the ASX 200 next week
- 2 ASX shares looking dirt-cheap today
- New Chinese government threat leaves these ASX mining stocks on tenterhooks
- ASX shares Tesla (NASDAQ:TSLA) needs to survive
- EcoGraf (ASX:EGR) shares up 72% in a week
Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
The post South32 (ASX:S32) share price up 3% on solid Q1 update appeared first on Motley Fool Australia.
from Motley Fool Australia https://ift.tt/3jbglOM
Leave a Reply