South32 Refinery Worsley Alumina WA Australia
Multi-listed South32 intends to return an additional US$500 million to shareholders, equating to 4.5% of the group’s current market capitalisation.

This capital management programme, which complements South32’s dividend policy, will initially take the form of an on-market share buy-back in Australia.

“The combination of our operating leverage, strong balance sheet and simple capital management framework is designed to maximise returns and reward shareholders as financial performance improves. This announcement demonstrates our disciplined approach to capital management and our confidence in the group’s cash generating capacity,” says South32 chairman, David Crawford.

“Our net cash balance continues to build giving us the financial strength and flexibility to invest in our existing operations, pursue opportunities where we can create value and return excess capital to shareholders,” states South32 CEO, Graham Kerr.

“The $500 million capital management programme meaningfully increases shareholder returns and follows the recent announcement of our $192 million interim dividend,” he continues.

The timing and number of shares purchased under the on-market share buy-back will be contingent upon the prevailing share price and market conditions. The on-market share buy-back is not subject to shareholder approval and will be funded from existing cash reserves.

The announcement of buy-back lodged on the ASX and voluntarily disclosed on the JSE and LSE has been submitted to the National Storage Mechanism and will shortly be available for inspection at:

The $500 million capital management programme is expected to be completed over a 12 month period and all alternatives will continue to be assessed to ensure this capital is returned in an efficient manner.

Feature image credit: South32

(South32’s alumina refinery at Worsley in Western Australia)