South32 Shares Rise on Strong December Quarter Production

Highlights:

• Strong Production Growth: South32 Ltd (ASX: S32) reported a 3% increase in aluminium output to 306,000 tonnes and a 9% rise in copper production to 19,100 tonnes for the December quarter, exceeding market expectations.
• Cannington Mine Performance: The Cannington mine delivered a 56% surge in zinc production, along with strong silver and lead outputs, highlighting operational excellence.
• Positive Market Response: At the time of writing, South32 shares rose 3.4% to $3.63, supported by UBS reaffirming its "buy" rating and a $4 price target.

Production Beats Expectations

South32 Ltd (ASX: S32) saw its shares climb 3.4% to $3.63 at the time of writing, following robust production results for the December quarter. The company's aluminium and copper output exceeded market expectations by 6% and 11%, respectively. Aluminium production increased by 3% quarter-on-quarter to 306,000 tonnes, while copper output rose 9% to 19,100 tonnes, according to analysts at UBS.

Cannington Mine’s Impressive Performance

South32’s Cannington mine recorded a 56% surge in payable zinc production during the quarter. This significant boost was accompanied by strong outputs of silver and lead, further highlighting the mine's operational excellence.

Analyst Commentary and Share Performance

UBS analyst Lachlan Shaw praised South32's operational strength across most assets but noted challenges in managing working capital and costs. The investment bank reaffirmed its “buy” rating on South32 shares, maintaining a price target of $4.

Market Response

At the time of writing, South32 shares were trading at $3.63, reflecting a 3.4% increase. The company's production performance and positive outlook continue to draw investor interest, solidifying its position as a key player in the mining sector.

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