Had the company’s figures not been hit by $1.7 billion in non-cash impairment related charges the result would have been quite different.

It generated underlying earnings before interest, tax, depreciation and amortisation of $1.1 billion in FY 16 for an operating margin of 21.5%.

The company recorded free cash flow – excluding equity accounted investments – of $597 million and finished the fiscal with $312 million in the bank. That came despite a 21% reduction in the average realised price for South32’s commodities.

It also recorded record annual production at Australia Manganese, Worsley Alumina, Brazil Alumina, Mozal Alumina and Cannington and “robust performance” at its other sites.

There was a $386 million reduction in controllable costs and a $306 million cut to capital expenditure.

The Appin Area 9 project at the Illawarra metallurgical coal business and the Premium Concentrate Ore project at Australia Manganese were completed ahead of schedule and below budget.

“We set five production records and achieved guidance for the majority of our upstream operations, generated controllable cost savings of $386 million and reduced capital expenditure by $306 million,” Kerr said.

“We will continue to unlock the potential of our portfolio, identify opportunities and pursue investments where we see value but will not compromise our strong balance sheet and investment grade credit rating.

“Looking to FY17 we have maintained production guidance for the majority of our upstream operations and will stretch performance to meet cost targets.

“Our functions are lean with corporate costs now half the level envisaged at the time of listing.”