South32 Limited

I will now hand over to Matt Daley, CEO. Please go ahead.

Thanks, Kayleigh, and good morning, everyone. Thanks for joining us today as we discuss our financial results for FY26, my first to South32 CEO. And of course, on the call today, we have Sandy, our Chief Financial Officer. So it's an exciting time for our business with our positive operating performance and repositioning to base metals driving strong financial results. a clear pathway to substantial value accretive growth in copper and zinc, with 55% production growth expected from projects under construction or approved, and a pipeline of growth and life extension options beyond this that can drive further value and returns for our shareholders. Before I run through our financial results, I do want to talk about safety. The most important measure of our success as a company is the safety of our people. And in FY26, we did not live up to the standards we set ourselves. The death of our colleague Simon Mukwarami in an incident at Worsley Illumina in March 2026 had a profound impact on everyone at South32, particularly our team at Worsley. Simon's family, friends and colleagues very much remain in our thoughts. We've taken steps to further enhance awareness of Worsley's existing procedures and controls for working at heights, and we continue to look at opportunities to design tasks in a way that eliminates or reduces fall from high risks. As South32's CEO, I'm unwavering in my commitment to a workplace free from fatalities. Turning back to our financial results, our base metals business drove strong earnings and cash flow with strong operating performance enabling us to capture the benefit of commodity price tailwinds, while active cost management mitigated the impact of industry-wide inflationary pressures. Group underlying EBITDA increased by 28% to US $2.5 billion and underlying earnings increased by 55% to $1 billion. Group cash flow from operations increased by $352 million to $610 million after investing approximately $700 million to grow future base metals production from Hermosa. Our balance sheet remains strong with net cash of $283 million after returning $327 million to our shareholders during the period. Reflecting our strong financial performance and disciplined approach to capital allocation, the Board has today resolved to pay a fully franked ordinary dividend of $0.054 per share or $242 million in respect of the June 2026 half year. We've also extending our capital management program to September 2027, with $209 million remaining to be returned to shareholders. On the 1st of July, we announced the sale of our aluminium value chain assets to Okowa for an enterprise value of up to $5.6 billion, plus the assumption of related rehabilitation provisions of over $1 billion. The transaction will unlock significant value for our shareholders and repositioned South32 as the leading base metals company on the ASX. We've got high margin assets in tier one jurisdictions, a transformational growth pipeline, and a strong balance sheet to deliver this growth and shareholder returns. We're working with our COA and the stakeholders to satisfy the conditions to the transaction and expect completion within the second half of FY27. Now looking forward to FY27, We're progressing a pipeline of projects under construction, approved and in study phase that are expected to substantially grow our popper and zinc production. At Sierra Gorda, this week we announced a 61% increase in the ore reserve to 1.1 billion tonnes, an extension of the initial reserve life by approximately five years to 19 years. This highlights the scale, the quality, and the long life ore body at Sierra Gorda, which is still open at depth. Sierra Gorda is expected to deliver production growth of 5% in FY27 and a further 2% in FY28, supported by higher planned copper grades. And beyond this, the recently approved fourth grinding line project is expected to increase production by approximately 30% from FY31. At Cunnington, we've upgraded expected ore process with the inclusion of lower grade stockpile material to utilise available plant capacity. Life extension work from both underground and open pit sources is continuing with the open pit development option offering the potential for further ore feed and life extension. At Hermosa, we are focused on delivering our large scale long life paler zinc lead silver project. The sinking of the ventilation shaft is advancing in line with our recent project update. and key processing infrastructure such as the primary and secondary mills and flotation cells have now all been installed. Once completed, Taylor is expected to deliver attractive financial returns for decades to come and support further growth phases at Hermosa. These include peak, where exploration study work is continuing to support the potential for a future copper production within an integrated development with Taylor. We're also progressing an exciting portfolio of exploration options and base metals. AMBLA metals boast district scale exploration potential in Alaska's unexplored and highly prospective AMBLA mining district, where summer field season work is underway, following progress on permitting and stakeholder support for the AMBLA access road. This paves the way to unlock value from AMBLA's high grade copper and zinc options. So in closing, Our operations are performing well. We're generating strong cash flow to underpin our base metals growth and shareholder returns. The sale of our aluminium value chain business will reposition South32 as a much simpler, higher margin business with a strong balance sheet and peer-leading growth, making South32 a leading base metals exposure for investors. I'm going to pause there and happy to take any questions.

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