South32 Ltd.

Overview Key strengths Key risks Diversified commodity portfolio across multiple countries. Smaller scale than larger, diversified peers such as BHP Group Ltd. and Glencore PLC. Has repositioned portfolio away from thermal coal to base metals. Cyclical and capital-intensive mining industry. Balance sheet flexibility. A debt-to-EBITDA ratio of below 1.0x (in our estimation) provides resilience to volatile commodity prices. Like its peers, South32 has a recent history of competing for opportunistic acquisitions of quality assets in lower-risk jurisdictions. This will enable the company to manage inherent cyclical volatility in the industry and is a key consideration for our ?BBB+? long-term issuer credit rating. South32 has adopted prudent initiatives to manage the pandemic-induced volatile commodity environment. These include suspending the company's share

...South32 Ltd.'s commitment to a conservative capital structure and low leverage supports a robust balance sheet. This will enable the company to manage inherent cyclical volatility in the industry and is a key consideration for our `###+' long-term issuer credit rating. South32 has adopted prudent initiatives to manage the pandemic-induced volatile commodity environment. These include suspending the company's share buyback program and deferring noncritical capital expenditure (capex). The company has also taken advantage of favorable prices arising from the pandemic recovery to build substantial cash levels. This has enabled it to make...

Full Report