(IN BRIEF) Anglo American reported its interim financial results for the first half of 2023, showing a 41% decrease in underlying EBITDA, largely due to weaker product prices. Despite macro headwinds, the company is on track to achieve its full-year production guidance, with a focus on safety, operational stability, and cost control. The Quellaveco project is ramping up strongly, and the company aims to produce 310-350 kt of copper in 2023. Anglo American is committed to capital discipline and reducing capital expenditure by $0.3 billion in 2023. Net debt increased to $8.8 billion, but the company maintains a strong balance sheet to support value-adding organic growth. The proposed dividend for H1 2023 is $0.55 per share, consistent with its 40% payout policy.
(PRESS RELEASE) LONDON, 28-Jul-2023 — /EuropaWire/ — Duncan Wanblad, Chief Executive of Anglo American, said: “Anglo American’s portfolio quality, product and geographic diversification together with strong organic growth optionality over the next decade provide positive differentiation and position our business to capitalise on highly attractive structural supply and demand trends. Our unwavering focus is on driving consistent, competitive performance across our operations – which starts with the safety and health of our employees.
“We have made further progress on safety, with our overall injury rates decreasing markedly in the first half. However, I am sad to report that we lost one colleague in a machinery incident at our Kumba business in February. None of us will rest until we achieve and sustain zero harm at Anglo American.
“Macro headwinds – principally, weaker prices for our products and input cost inflation – certainly weighed on our first half financial performance. We are on track to deliver on our full year production guidance, which includes a significant anticipated step-up in volumes in the second half. Our focus on operational stability and cost control are our key margin levers and we also expect to deliver annual efficiencies of $0.5 billion from across our full range of business support activities.
“Underlying EBITDA of $5.1 billion at a 41% Mining EBITDA margin* reflects a 19% lower product basket price and a 1% unit cost increase, partially offset by a 10% volume increase compared with the first half of 2022. Our commitment to capital discipline and to a strong balance sheet makes us more resilient to the external environment and supports our range of options for value-adding organic growth. As we drive greater effectiveness across our organisation, so we are also ensuring capital efficiency, with an expected $0.3 billion reduction in growth capital expenditure guidance in the current year. Net debt increasing to $8.8 billion, less than 1 x annualised underlying EBITDA, reflects the growth investments we are making through the cycle in line with our belief in the strong long term fundamentals. Our $0.7 billion proposed dividend for H1 2023 of $0.55 per share is in line with our 40% payout policy.
“There is no doubt that while the nearer term macro picture presents challenges, the longer term demand outlook for future-enabling metals and minerals is ever more compelling. As most major economies accelerate their decarbonisation programmes and as the global population grows by up to 2 billion people over the next 25 years, with an associated need for higher living standards, our objective is to grow the value of our business into that demand.”
|Six months ended
US$ million, unless otherwise stated
|30 June 2023||30 June 2022||Change|
|Mining EBITDA margin*||41%||52%|
|Attributable free cash flow*||(466)||1,564||(130)%|
|Profit attributable to equity shareholders of the Company||1,262||3,680||(66)%|
|Basic underlying earnings per share* ($)||1.38||3.11||(56)%|
|Basic earnings per share ($)||1.04||3.03||(66)%|
|Interim dividend per share ($)||0.55||1.24||(56)%|
|Group attributable ROCE*||18%||36%|
Terms with this symbol * are defined as Alternative Performance Measures (APMs). For more information, refer to page 77 of the results PDF.
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SOURCE: Anglo American