South32 : 2019 Annual General Meeting Speeches

24 October 2019	South32 Limited
	(Incorporated in Australia under the Corporations Act 2001
	(Cth))
	(ACN 093 732 597)
	ASX / LSE / JSE Share Code: S32 ADR: SOUHY
	ISIN: AU000000S320
	south32.net
	2019 ANNUAL GENERAL MEETING SPEECHES

In accordance with ASX Listing Rule 3.13, South32 Limited (ASX, LSE, JSE: S32; ADR: SOUHY) (South32) today releases the addresses to shareholders to be given by the Chair and Chief Executive Officer at South32 Limited's Annual General Meeting in Perth.

An audio webcast will be available via a link on our website at: https://www.south32.net/investors-media/annual-general-meetings

Nicole Duncan

Chief Legal Officer and Company Secretary

About South32

South32 is a globally diversified mining and metals company. We produce bauxite, alumina, aluminium, energy and metallurgical coal, manganese, nickel, silver, lead and zinc at our operations in Australia, Southern Africa and South America. We also have a high grade zinc, lead and silver development option in North America and several partnerships with junior explorers with a focus on base metals. Our purpose is to make a difference by developing natural resources, improving people's lives now and for generations to come, and to be trusted by our owners and partners to realise the potential of their resources.

Further Information
Investor Relations
Alex Volante	Tom Gallop
T	[phone]	T	+61	8 9324 9030
M	[phone]	M	+61	439 353 948
E	[e-mail]	E	[e-mail]
Media Relations
James Clothier	Jenny White
T	[phone]	T	+44	20 7798 1773
M	[phone]	M	+44	7900 046 758
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Further information on South32 can be found at www.south32.net.

JSE Sponsor: UBS South Africa (Pty) Ltd

24 October 2019

Registered Office Level 35 108 St Georges Terrace Perth WA 6000 Australia
ABN 84 093 732 597 Registered in Australia	1

SOUTH32 LIMITED

2019 Annual General Meeting

24 October 2019

Speeches by Karen Wood, Chair and

Graham Kerr, Chief Executive Officer

Karen Wood, Chair

Good morning ladies and gentlemen, and welcome to South32's 2019 Annual General Meeting.

My name is Karen Wood and it is my pleasure to chair today's meeting.

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I confirm that a quorum is present, and now formally declare the meeting open.

All members of the South32 Board are here today.

On my far left, Non-Executive Directors Frank Cooper, Xiaoling Liu, Keith Rumble and Futhi Mtoba.

Next to me on my left is Graham Kerr, our Chief Executive and Managing Director.

From my far right are non-executive directors Xolani Mkhwanazi and Wayne Osborn.

And Nicole Duncan our Company Secretary who also serves as the company's Chief People and Legal Officer.

During the past year our inaugural Chair David Crawford retired after many years of distinguished service to our industry.

He was the first Chair of South32 and the importance of the role he played cannot be over-estimated.

He worked hard to ensure that South32 was set up for success from the beginning.

That included ensuring it started life with a robust balance sheet; which is critical to a cyclical business like ours.

He also worked hard with Graham and the Board to develop the company's purpose and strategy as well as its core values of Care, Trust, Togetherness and Excellence.

I know I speak for many when I say that we are in his debt and on behalf of all shareholders and the thousands of South32 people, I thank him for his service.

Our Lead Team are in attendance today and are seated in the front row.

We have with us our Chief Financial Officer, Katie Tovich, Chief Commercial Officer, Peter Finnimore, Chief Commercial Officer elect, Brendan Harris, Chief Operating Officers, Mike Fraser and Paul Harvey, Chief Sustainability Officer, Rowena Smith, Chief Technology Officer, Vanessa Torres and Chief Development Officer, Simon Collins.

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All members of the Board, Lead Team and other members of South32 look forward to the opportunity to meet with you after the formalities.

Also in attendance today is Denise McComish representing the Company's auditors KPMG.

This is Denise's last meeting as Auditor and I want to take this opportunity to thank her for her service.

Tim Heughan from Computershare will oversee the polling process.

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During the year the Board visited several of our operations and offices around the world.

Those visits are an important part of our work. They help us see first-hand the issues that our operations face and give us the opportunity to better understand the surrounding communities who play such an important part in our success.

The visits also provide a means by which we can test the culture of South32. Our culture is reflected in the way we work and these visits give us the opportunity to see this in practice, very often in locations far removed from our offices.

One thing that is clear to me from those visits is that the values we have established are well understood and that our people - wherever they are located - work hard each day to entrench them in everything they do.

This is particularly true of the focus on safety, which remains at the heart of all we do.

That work is never finished but I am proud to say that our year on year performance improved in 2019.

In our view the most important example of our value of Care is that everyone goes home safe and well.

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The 2019 Financial Year was another busy and successful year for South32.

We continued to focus on creating long-term value for our shareholders by maintaining financial discipline and delivering on our strategy.

These things are not achieved without the continued dedication, hard work and support from our entire workforce and I want to take the opportunity to thank each and every member.

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We continued to reshape and improve our portfolio, and completed the acquisition of Arizona Mining during the year, adding the Hermosa project.

This is one of the most exciting base metals projects in the industry.

We also acquired a 50 per cent interest in the Eagle Downs Metallurgical Coal project in Queensland and progressed the divestment of South Africa Energy Coal.

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Graham will talk more about our portfolio shortly.

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The 2019 Financial Year was marked by strong overall operating performance. This delivered:

• Underlying earnings before interest, tax and depreciation of 2.2 billion US dollars;
• Free cash flow of 1 billion US dollars; and
• A net cash balance of 504 million US dollars.

We returned US938 million dollars to shareholders during the reporting period. This included US366 million dollars which was returned to shareholders as part of our ongoing capital management program.

Of the capital returned, dividends in respect of the year totalled US9.6 cents per share (or 13.7 cents in Australian dollar terms), including a fully franked final dividend of US2.8 cents per share and a special dividend of US1.7 cents per share.

We also increased our capital management program by US250 million dollars to US1.25 billion dollars in total - reflecting our disciplined approach to capital management and the positive outlook for our business.

These decisions were taken consistent with our capital management framework which is designed to:

• maintain safe and reliable operations and an investment grade credit rating;
• distribute a minimum of 40% of Underlying earnings as ordinary dividends; and
• assess competition for excess capital - such as investment in the business, acquisitions, greenfield exploration, share buy-backs, and special dividends.

Over the past four years, we have delivered a total shareholder return of 84 per cent, which has exceeded both the sector index and the Morgan Stanley Capital International world index.

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In January we were deeply saddened by the tailings dam failure at Brumadinho in Brazil, a site owned by resource company Vale.

The result was a significant loss of life and immense environmental damage; consequences that have deeply impacted all who work in this industry.

We are determined to play our part in making sure these tragic events don't happen again and to that end have supported the work of the International Council on Mining and Metals to develop an international standard for safe tailings management.

In June we released our Tailings Storage Facilities Management Report, in line with the Investor Mining and Tailings Safety Initiative, that details our approach.

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Our Purpose makes it clear that we aim to make a difference by developing natural resources and, as a result, make people's lives better now and for generations to come.

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We cannot do that unless we create value through social and environmental leadership at the same time as we deliver returns to shareholders.

An example of this is the way in which we are addressing the impact of climate change including changing weather patterns, increased regulation, shifts in technology and the growing expectation from the community at large and our shareholders that we will play our part.

This is a journey we have been on for some time.

In September we published the third of our reports called Our Approach to Climate Change.

This report meets the recommendations of the Task Force on Climate-related Financial Disclosures and outlines three areas of focus.

The first, is the climate change opportunity - which outlines how we aim to manage our portfolio in a way that ensures our products remain in demand and resilient, including by providing raw materials that support action on climate change.

Many of our commodities will have an important role to play as we shift towards a low carbon economy.

Silver, for example, is used in solar panels, nickel in stainless steel, and aluminium is becoming an increasingly popular choice for sustainable buildings.

The second, is how we work towards climate resilience for our communities and our operations, and the third, is how we reduce emissions to support the transition to net zero carbon emissions by 2050.

We have set targets and goals and we report against these annually. We also align remuneration outcomes to those targets and goals.

Our decarbonisation plans are aligned with the Paris Agreement, and our long-term goal of net zero emissions from our operations by 2050 reflects this commitment.

Overall, we remain on-track to achieve our 2021 Financial Year Scope 1 target to maintain emissions at or below our baseline set in the 2015 Financial Year.

By working to avoid andmanage climate change risks, as well as taking advantage of the opportunities we have, we can meet our Purpose by creating a more prosperous future for our business, society and future generations.

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These goals are not mutually exclusive. Beyond safe and financially successful operations we must also focus on the lives of the people surrounding them, working together to create healthier, stronger and more resilient communities.

If we do this well it means not only meeting the aspirations in our Purpose but also creating a legacy for generations to come.

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