South32 shares drop as company reveals cyclone damage toll at NT mine

South32 (ASX:S32) has announced it’s pulling guidance for manganese production at its mine in northeast NT following heavy storm damage.

The stock is down over -3% in the second hour of Wednesday trades, even as the materials sector slides into the green.

The Groote Eyelandt manganese project was suspended on Monday when the company first announced major damage to a wharf.

On Monday the company implied guidance may come under pressure due to the damage. On Wednesday, that’s been confirmed.

“We are withdrawing guidance for Australia Manganese and will provide a further update in our March 2024 Quarterly Report,” the company wrote on Wednesday.

“As weather conditions have eased on the Eylandt, access to key infrastructure has been restored to enable an initial assessment of impact.”

The impact may be worse than previously anticipated.

Mining pits are flooded and there’s been damage to both the wharf used for exports as well as a major haul road bridge.

That bridge connects the northern pits to the manganese processing plant – which can’t now be accessed safely by truck and which can’t then send processed ore for export until all repairs are made.

“Alternative shipping arrangements are also being evaluated,” the company wrote on Wednesday.

S32 last traded at $3.02/sh.