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South32 half-year profit vaults higher on strong commodity prices
February 15, 2017 / 11:15 PM / 8 months ago

South32 half-year profit vaults higher on strong commodity prices

SYDNEY (Reuters) - Stronger coal and manganese prices lifted half-year underlying earnings from continuing operations at Australia’s South32 (S32.AX) 18-fold to $479 million (384.37 million pounds) from a year earlier, beating market expectations.

A sign adorns the building where Australian miner South32 has their office in Perth, Western Australia, November 19, 2015. REUTERS/David Gray

The miner, built around a group of unwanted assets spun-off by BHP Billiton (BLT.L) (BHP.AX), also declared its first interim dividend of 3.6 U.S. cents a share.

“The disciplined application of our strategy and stronger commodity prices underpinned a significant improvement in financial performance,” Chief Executive Graham Kerr said in a statement.

South32’s share price has more than doubled over the past year, aided by the timely acquisition of a metallurgical coal mine in Australia from Peabody Energy BTUUQ.PK.

The miner also enjoyed surging manganese and metallurgical coal prices - up 300 percent and 200 percent respectively in 2016 - but prices are now in decline.

So far this year, manganese is down 41 percent from its 2016 peak, while metallurgical coal is off 47 percent.

Reporting by James Regan; Editing by Richard Pullin

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