#124 AUGUST 2023 EIII ΙΙΙΞ SOUTH 32 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 2023 FULL YEAR FINANCIAL RESULTS PRESENTATION South32 Limited (ASX, LSE, JSE: S32; ADR: SOUHY) (South32) will hold a conference call at 8.30am Australian Western Standard Time to discuss the attached 2023 full year financial results presentation materials, the details of which are as follows: Conference ID: Please pre-register for this call at link. A presentation is attached. Following the conference call a recording will be available on the South32 website (https://www.south32.net/investors/presentations-speeches). Separately a video presentation by South32 Chief Executive Officer, Graham Kerr, will be made available on the South32 website (https://www.south32.net/news-media/latest-news). About us South32 is a globally diversified mining and metals company. Our purpose is to make a difference by developing natural resources, improving people's lives now and for generations to come. We are trusted by our owners and partners to realise the potential of their resources. We produce commodities including bauxite, alumina, aluminium, copper, silver, lead, zinc, nickel, metallurgical coal and manganese from our operations in Australia, Southern Africa and South America. With a focus on growing our base metals exposure, we also have two development options in North America and several partnerships with junior explorers around the world. Investor Relations Ben Baker T +61 8 9324 9363 M +61 403 763 086 E [email protected] Media Relations Jamie Macdonald T +61 8 9324 9000 M +61 408 925 140 E [email protected] +61 8 9324 9000 Miles Godfrey T M E +61 415 325 906 [email protected] Further information on South32 can be found at www.south32.net. Approved for release to the market by Graham Kerr, Chief Executive Officer JSE Sponsor: The Standard Bank of South Africa Limited 24 August 2023 Registered Office Level 35 108 St Georges Terrace Perth WA 6000 Australia ABN 84 093 732 597 Registered in Australia#2Pending#3Pending#4Pending#5Pending#6Pending#7Pending#8Pending#9Pending#10DELIVERING ON OUR STRATEGY Notes: a. We are reshaping our portfolio to focus on commodities critical for a low-carbon future Underlying revenue by commodity(a) South32 at demerger¹4 32% 33% 11% 18% FY23 6% 7% 16% 8% 5% 7% 7% 45% base metals including aluminium value chain 71% base metals including aluminium value chain Aluminium value chain Copper Nickel Manganese ore Zinc-lead-silver Metallurgical coal South Africa Energy Coal and manganese alloys (exited) 50% Presented on a proportional consolidation basis. Excludes third party product revenue and Group and unallocated costs. Doubled our low-carbon aluminium capacity Added Sierra Gorda copper to our portfolio Allocated excess capital generated by Illawarra Metallurgical Coal to grow our base metals portfolio and deliver record shareholder returns Advanced multiple development options in critical minerals at our Hermosa project Progressed greenfield exploration options in highly prospective regions SLIDE 9 SOUTH32#11Pending#12Pending#13Pending#14INCLUSION AND DIVERSITY Building an inclusive and diverse workforce to unlock the full potential of our people Women on our Board Total employees who are women19 44.4% FY22: 37.5% FY21: 37.5% 20.2% FY22: 19.2% FY21: 18.4% Women on our Lead Team Women in Senior Leadership Women in Operational leadership20,(a) Black People 21 in South Africa in management roles²² Total employees in South Africa who are Black People21 50.0% FY22: 37.5% FY21: 44.4% 30.3% FY22: 32.1% FY21: 29.6% 28.7% FY22: 20.4% FY21: 18.3% 55.3% FY22: 61.9% FY21: 52.4% 86.9% FY22: 86.1% FY21: 85.7% Notes: a. Commencing FY23 the definition of Operational Lead Team was expanded to include functional leaders based at operations. SAFE ミミ SOUTH32 SLIDE 13 SOUTH32#15Pending#16Pending#17Pending#18Pending#19Pending#20Pending#21Pending#22Pending#23Pending#24Pending#25Pending#26Pending#27Pending#28Pending#29Pending#30Pending#31Pending#32Pending#33Pending#34Pending#35Pending#36MARKETS OUTLOOK ME SOUTH32#37Pending#38ALUMINA MARKET III SOUTH32 Higher bauxite costs are challenging margins at less efficient refineries, with ~50% of global supply currently loss-making Inducement cost projects expected to be built outside of China due to declining bauxite self-sufficiency and environmental policy Alumina cost curve (CY22 and CY23e)(a) (US$/t) 600 500 400 300 200 100 Spot price US$345/t(b) with ~50% of global supply loss-making Chinese domestic alumina production (Mt) 80 CY22 cost curve China - domestic bauxite Middle East & Africa China - imported bauxite Americas ■Europe Other 60 60 Sources: Alumina cost curve (CRU). Chinese domestic alumina production (CRU). Notes: a. b. Illustrates business costs which represent cash costs net of premiums (normalised to FOB Australia price). Spot price as of 21 August 2023. 40 40 20 20 Imported bauxite ༔ ༔ ༔ ༔ ༔ རྞྞ རྞྞ ༔ ༔ རྞྞ ༔ སྦྱི Henan & Shanxi - Domestic Bauxite Henan & Shanxi - Imported Bauxite Shandong - Imported Bauxite ■Southwest China - Domestic Bauxite ■Southwest China - Imported Bauxite Inner Mongolia - Imported Bauxite Domestic bauxite#39Pending#40Pending#41Pending#42BATTERY-GRADE MANGANESE MARKET Committed government policies are expected to underpin a near six-fold increase in North American NEV penetration levels by 2030 We expect manganese-rich battery chemistries to capture ~30% of the market by 2030, and >50% by 2040 NEV (passenger car and commercial vehicle) penetration rates (a)(b)(c)(d) Manganese-rich cathodes provide substantial cost, performance and sustainable sourcing benefits Electric vehicle battery chemistries Active cathode materials, % by mass 50% NEV penetration in North America by 2030 100% 2021 2022 2023 2024 2025 2030 2040 2050 North America NEV Penetration Rate ROW NEV Penetration Rate LFP NCM-622 LMFP NMx III SOUTH32 Co 18% Fe 60% Mn 65% Mn 17% Mn 69% Ni 54% Fe 18% P 33% Ni 25% P 10% Li 11% Li 7% Li 7% Li 6% Battery chemistry for a standard NCM-622 battery contains ~17% Mn by mass while contributing <1% to cost (e) The future adoption of manganese-rich chemistries is increasingly supported by cathode producers and OEM public announcements of their next generation battery chemistry strategies Sources: NEV (passenger car and commercial vehicle) penetration rates (South32 analysis). Electric vehicle battery chemistries (Bloomberg NEF, Esource and other publicly available information). Notes: a. NEV includes plug-in hybrids, battery EVs and hydrogen fuel-cell passenger cars. b. NEV penetration is calculated as NEV production divided by total automobile production. C. Passenger car and commercial vehicles include commercial trucks/SUVS. d. North America refers to US, Canada and Mexico. e. Based on prices as at the end of 2022. SLIDE 41#43HARD COKING COAL MARKET Easing supply constraints post La-Nina and weaker than expected recovery in Chinese steel demand have weighed on prices Hard coking coal price and arbitrage (US$/t) 700 Seasonal India restocking and potential Australian supply constraints due to rail logistics bottlenecks expected to provide near-term price support III SOUTH32 Growing demand and tighter supply of premium HCC (a) to provide long term price support for high grade product Premium HCC as % of Global Seaborne HCC supply is decreasing (%) 100% 600 500 400 300 200 100 Aug-19 Feb-20 Aug-20 Feb-21 Aug-21 Feb-22 -Prem Low Vol HCC FOB Australia سا Aug-22 Feb-23 Aug-23 Prem Low Vol HCC CFR China 80% 60% 40% 20% 2022 2030e 2040e Premium HCC HCC Sources: Hard coking coal price and arbitrage (Platts, South32 Analysis). Premium HCC as % of Global Seaborne HCC supply is decreasing (CRU, South32 analysis). Notes: a. Premium hard coking coal (HCC) is classified as CSR (coke strength after reaction) greater than 65. SLIDE 42#44Pending#45Pending#46ALUMINIUM SMELTER COST BREAKDOWN Smelter raw material input prices have started to moderate from elevated levels across the industry Hillside Aluminium - Operating unit costs (US$/t) Mozal Aluminium - Operating unit costs (US$/t) H1 FY23 H2 FY23 H1 FY23 17% 14% 19% 25% 3% 4% 1% 21% 26% 3% 2% I US$2,276/t I US$2,092/t 2% US$2,237/t 1 Electricity Raw materials 53% 10 HoH impact on costs (US$/t) 55% 55% 74 H2 FY23 21% 23% 3% US$2,433/t 3% | I HoH impact on costs (US$/t) 13 8 50% (5) (21) (12) Pot relining (45) Labour Other(a) Pitch ATF Coke (62) Electricity Alumina I Electricity Pitch ATF Coke Alumina Notes: a. Other primarily relates to inventory movements and freight. SLIDE 45 SOUTH32#47Pending#48Pending#49Pending#50Pending#51FOOTNOTES 1. Refer to market release "Hermosa Project Non-Cash Impairment" dated 24 July 2023. 2. 3. 4. 456 6. 7. 8. 9. III SOUTH32 Refer to market release "South32 unlocks up to US$200M in value from non-core royalty sale" dated 12 July 2022. The sales price included US$103M in cash payments, US$82M of Ecora Resources PLC (formerly known as Anglo Pacific Group PLC) shares issued on completion and contingent payments of up to US$15M. The cash payment comprises US$48M paid on completion, and US$55M payable in six equal quarterly instalments over the 18 months from completion (US$28M will be received across FY24). The contingent payment is triggered if the West Musgrave project achieves commercial production, and throughput and commodity price-related conditions are met prior to an agreed expiry date. In August 2023, the Chilean Mining Tax reforms became fully enacted and are effective from 1 January 2024. As part of the Group's acquisition of Sierra Gorda during FY22, the Group has the right to claim an indemnity from the vendors for any mining tax changes enacted prior to December 2025. As the Mining Tax reforms have become law, the Group has recognised other income of US$48 million and a corresponding receivable of US$48 million from the vendors in relation to the indemnity. Refer to market release "Dendrobium Next Domain Update" dated 23 August 2022. Metrics describing health, safety, environment, people and community related performance in this presentation apply to 'operated operations' which include our controlled entities and South32-operated joint arrangements. Incidents are included where South32 controls the work location or controls the work activity. Since FY20 we have disclosed fatalities that occur as part of activities associated with our operations, where we seek to influence safety performance, but which occur in locations where we do not have operational control. In FY21, an employee from a company contracted by Cerro Matoso lost their life while carrying out road paving activities on the public road between the municipality of Planeta Rica and our Q&P Project. In FY23, an employee from a company contracted by our South Africa Manganese operation lost their life in an offsite road trucking accident. Total Recordable Injury Frequency (TRIF): (Sum of recordable injuries x 1,000,000) + exposure hours. Lost Time Injury Frequency (LTIF): (Sum of lost time injuries x 1,000,000) + exposure hours. Total recordable illness frequency (TRILF): (Sum of recordable illnesses x1,000,000) + exposure hours. TRIF, LTIF and TRILF are stated in units of per million hours worked for employees and contractors. We adopt the United States Government Occupational Safety and Health Administration and the International Council on Mining and Metals guidelines for the recording and reporting of occupational injuries. In FY22 an additional two illnesses have been recorded and restated, and one additional illness was reported and restated in FY21. The nature of illnesses can result in prolonged diagnosis. Total significant hazards frequency (per 1,000,000 hours worked). A hazard is something that has the potential to cause harm, ill health or injury, or damage to property, plant, or the environment. 10. FY23 growth in copper equivalent production at our aluminium (Brazil Aluminium, Hillside Aluminium and Mozal Aluminium) and base metals (Sierra Gorda, Cannington and Cerro Matoso) operations, compared to FY22. Copper equivalent production was calculated using FY22 realised prices for all operations (except for Brazil Aluminium which is based on FY22 average index prices for aluminium). Refers to aluminium produced using renewable power. 11. 12. Operating margin comprises Underlying EBITDA excluding third party product EBITDA, divided by Underlying revenue excluding third party product revenue. 13. 14. Free cash flow represents cash generated from operations, including net distributions from EAIS, and after capital expenditure, net interest and income taxes paid. South32 demerged in FY15. Normalised revenue based on FY23 average realised prices at all our operations except for South Africa Energy Coal (SAEC), Tasmanian Electro Metallurgical Company (TEMCO) and Metalloys. For these exceptions, the normalised revenue is based on the average index prices for FY23 except for SAEC's domestic energy coal, which is calculated based on R550/t using a USD:ZAR exchange rate of 17.66. South Africa Manganese ore has been restated to 54.6%. 15. Group FY22, FY23, and FY24e copper equivalent production was calculated using FY23 realised prices for all operations. 16. Community investment consists of direct investment, in-kind support and administrative costs. In FY23, our total community investment comprises of US$0.6M in-kind support, US$2.5M administrative costs, and US$24.6M in direct investments (including enterprise development). 17. Local procurement is the direct purchase of goods and services within the local communities in which South32 operates. Suppliers are deemed as local based on their proximity to our local communities, including boundaries defined by local government areas, provinces and states. 18. Goal is defined as an aspiration to deliver an outcome for which we have not identified a pathway for delivery, but for which efforts will be pursued towards achieving that outcome, subject to certain assumptions or conditions. 19. "Women" are defined as employee headcount with a sex of "Female". 20. Operations Leadership Team is defined as all members of an Operations Lead Team. Functional membership is limited to one per function and must be site based. 21. Generic term meaning Africans, Coloureds and Indians who are citizens of the Republic of South Africa by birth or descent; or who became citizens of the Republic of South Africa by naturalisation before 27 April 1994 or on or after 27 April 1994 and who would have been entitled to acquire citizenship by naturalisation prior to that date, as defined in the Broad-Based Black Economic Empowerment Amendment Act 2013 (South Africa). 22. Management roles are leaders with an identified job grading, based on the requirements of their role and salary, including executives and senior management. 23. Target is defined as an intended outcome in relation to which we have identified one or more pathways for delivery of that outcome, subject to certain assumptions or conditions. 24. South Africa Manganese ore has been reported as a 54.6% interest (previously 60%) reflecting our Metalloys manganese alloy smelter (60% interest) having been placed on care and maintenance, and aligning with our interest in Hotazel Manganese Mines (HMM). South32 has a 44.4% ownership interest in HMM. 26% of HMM is owned by a B-BBEE consortium comprising Ntsimbintle Mining (9%), NCAB Resources (7%), Iziko Mining (5%) and HMM Education Trust (5%). The interests owned by NCAB Resources, Iziko Mining and HMM Education Trust were acquired using vendor finance with the loans repayable via distributions attributable to these parties, pro rata to their share in HMM. Until these loans are repaid, South32's interest in HMM is accounted at 54.6%. 25. Other includes cost savings associated with the Metalloys manganese alloy smelter having been placed on care and maintenance, partially offset by lower profitability from our additional interest in Mozal Aluminium and costs related to the closed Bayside Aluminium smelter. 26. Other primarily relates to Underlying depreciation and amortisation, Underlying other income, Underlying third party products and services, and Underlying share of profit/(loss) of non-material EAI. 27. Underlying net finance costs and Underlying income tax expense are actual FY23 results, not year-on-year variances. 28. Other includes cost savings associated with the Metalloys manganese alloy smelter having been placed on care and maintenance, partially offset by costs related to the closed Bayside Aluminium smelter. SLIDE 50#52Pending#53Pending#54Pending#55Pending#56Pending#57Pending#58Annexure 2: Material Assumptions to support Production Target for Clark deposit Criteria Mineral Resource estimate as a basis for the production target Study status Cut-off parameters Mining factors or assumptions Commentary • • 69% Indicated and 31% Inferred Mineral Resources support a mine life of 70 years (Table 3). The Mineral Resource estimate was declared as part of South32's Annual Report published on 9 September 2022 and is available to view on www.south32.net. South32 confirms that the inclusion of 31% tonnage from Inferred Mineral Resources is not the determining factor of the project viability. The project forecasts a positive financial performance when using 69% tonnage from Indicated Mineral Resources. South32 is therefore satisfied that the use of Inferred Mineral Resources in the determination of the Production Target is reasonable. A selection phase of the pre-feasibility study has been completed for the Clark Deposit in compliance with the Association for the Advancement of cost engineering (AACE) International Class 5 estimate standard within an accuracy range of +/- 35%. A technically achievable and economically viable mine plan has been determined by the study team. Material modifying factors have been considered and are included in this section of the report. Clark is a polymetallic deposit which uses an equivalent Net Smelter Return (NSR) value as a grade descriptor. NSR considers the remaining gross value of the in-situ revenue generating elements once processing recoveries, royalties, concentrate transport, refining costs and other deductions have been considered. The elements of economic interest used for cut-off determination include manganese (Mn), silver (Ag)and zinc (Zn). The cut-off strategy employed at Clark is to optimise the NPV of the operation. An NSR cut-off grade of US$160/tonne was used in the development of mineable stope shapes. Primary access to the orebody will be through a single decline. Ventilation raises will be established to provide ventilation to the working areas. Paste backfill will be produced in a surface backfill plant and distributed underground via a backfill reticulation system. The mining method applied is longhole open stoping with paste backfill. This is the preferred mining method based on a combination of productivity, cost, resource recovery and risk of surface subsidence. The mining dilution is applied based on rock dilution or fill dilution dependent on the location of the stope being mined. Dilution factors are applied on a stope-by- stope basis using incremental dilution widths applied to the stope geometry Geotechnical recommendations based on deposit geology have been used to develop the stope shape dimensions. Due to the continuous nature of the orebody the mining recovery factor in primary stopes is 105% to account for overbreak into ore in the adjacent secondary stopes. The mining recovery factor in the secondary stopes is 85%. Inferred Mineral Resources are incorporated into the stope designs and contribute to the overall weighted grades and NSR of the stope. Inferred Mineral Resources contribute approximately 31% of the total planned tonnes. A risk assessment was completed to understand the incremental value contributed by addition of Inferred Resources and to confirm project viability without considering revenue from Inferred Resources. The proposed mining method with modifying factors applied supports a single- stage ramp-up to a life of mine average of 0.6Mt per annum. 57#59Pending#60Pending#61Pending