South32 share price storms higher on strong half year result

The South32 Ltd (ASX:S32) share price has stormed higher after the release of a strong half year result and positive outlook for the second half…

| More on:
a woman

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The South32 Ltd (ASX: S32) share price has been a strong performer on Thursday following the release of its half year results.

In morning trade the mining giant's shares are up 4% o $3.82.

What happened in the first half?

For the six months ended December 31, South32 posted revenue of US$3,811 million and profit after tax of US$635 million. This was a 9% and 17% increase, respectively, on the prior corresponding period.

Record production at the Australia Manganese operation, strong operating performances across the board, and higher commodity prices were the key drivers of the company's profit growth.

Earnings per share came in at 12.5 U.S. cents for the half, up 19% on the first half of last year.

The strong performance allowed the South32 board to increase its ordinary dividend by 19% to 5.1 U.S. cents per share and declare a special dividend of 1.7 U.S. cents per share.

What's next?

The strong first half means that management has retained its production guidance for all its operations with the exception of Illawarra Metallurgical Coal. This operation has seen its full year production guidance increase by 7%.

Management also advised that it has lowered its unit cost guidance after maintaining operating discipline and benefiting from a stronger U.S. dollar.

South32's CEO, Graham Kerr, said: "We are well positioned for the second half of the year, with a net cash balance of US$678M and an improving outlook for production and costs. This strong position has allowed us to return US$511M to shareholders in respect of the period with today's declaration of a US$258M fully franked interim dividend and an US$86M fully franked special dividend."

Should you invest?

I thought this was a strong result from South32 and I can't say I'm surprised to see its shares push higher today. And with commodity prices looking favourable right now, I think the second half could be equally strong.

This could make it a great option in the resources sector along with BHP Group Ltd (ASX: BHP) and Rio Tinto Limited (ASX: RIO).

No tickers found. You need to add tickers and save as draft before fetching disclosure

More on Share Gainers

a young woman looks happily at her phone in one hand with a selection of shopping bags in her other hand.
BNPL shares

Up 87% since April, why the Zip share price can keep flying higher into 2026

A leading fund manager expects more outsized gains from Zip shares ahead.

Read more »

Person pretends to types on laptop drawn in sand.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a miserly session for investors today.

Read more »

Happy coal miner.
Share Gainers

Up 75% this week, why is this ASX All Ords stock rocketing again today?

Investors are piling into this ASX 300 stock on Wednesday. But why?

Read more »

A young woman smiles as she rides a zip line high above the trees.
Share Gainers

Here are the top 10 ASX 200 shares today

It was a bountiful session for investors this hump day.

Read more »

Man looking happy and excited as he looks at his mobile phone.
Share Gainers

Why Coronado, DroneShield, Lovisa, and Mayne Pharma shares are racing higher today

These shares are having a good time on hump day. But why?

Read more »

Man pointing at a blue rising share price graph.
Share Gainers

Guess which ASX 300 stock just rocketed 43% on big news!

Investors are piling into this ASX 300 stock on Wednesday. But why?

Read more »

Three friends leaping in the air in joy with a dog on the ground.
Share Gainers

Can May's top 3 performing ASX 50 stocks repeat in June?

These three blue chip stocks led the pack in the month of May. Do brokers think they can back it…

Read more »

The silhouettes of ten people holding hands with their arms raised against the sky, as the sun rises or sets in the background.
Share Gainers

Here are the top 10 ASX 200 shares today

The ASX was back to the races this Tuesday.

Read more »