BHP spin-off South32 aims to cut group costs by 25 per cent this financial year, as part of a broader target to strip costs amid a slump in commodities prices.
The company has maintained production guidance for all its mining operations, but expects capital expenditure to decline more than the previously targeted nine per cent, on account of continued weakness in the Australian and South African currencies.
On Thursday, the miner said it had lifted production in the September quarter, helped by strong performance at its Australian operations but constrained by continuing problems in South Africa.
"We are making excellent progress as we seek to optimise our operations, reduce costs and sustainably de-capitalise the business," chief executive Graham Kerr said.
"We continue to take decisive action to maximise financial performance, rather than volume."
South32, which listed earlier this year after demerger from mining giant BHP Billiton, had announced in August it would strip out $US350 million ($A485.20 million) in costs by the end of its 2018 financial year.
It is now finalising an in-depth review of "all functional support" to deliver a 25 per cent reduction in FY 2016 group costs.
The mining group also said alumina production in the three months to September rose 10 per cent from a year ago to 1.36 million tonnes, helped by a bounce back from maintenance at its Worsley plant in Western Australia.
However, aluminium metal production fell seven per cent to 244,000 tonnes as the company suspended some production in South Africa on the back of weak market conditions and problems with electricity supply.
Thermal coal output rose 2.00 per cent to 8.698 million tonnes, while record production at Illawarra helped boost metallurgical coal output by 13 per cent to 2.079 million tonnes.
Manganese ore production rose six per cent because of higher plant availability in Australia, but the troubles at its South African operations meant the alloy production was down 36 per cent to 65,000 tonnes.
The company announced in July it was suspending capacity at its South African manganese smelter due to challenging market conditions.
It expects to complete a review of its South African manganese business by the end of December.
South32 shares gained 4.5 cents, or 3.1 per cent, to $1.495.
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