14th Feb 2014 08:09
LONDON (Alliance News) - Anglo American PLC Friday said it swung to a pretax profit in 2013 as improved production and weakening producer currencies helped company finances.
The major mining company posted a pretax profit of USD1.70 billion for the twelve months ended December 31, 2013, compared from a pretax loss of USD171 million the previous year.
The company said its group revenues including associates and joint ventures increased 0.8% to USD33.06 billion from USD32.79 billion in 2012, as increased production rates and weaker currencies where it incurs costs offset generally lower commodity prices across the company's portfolio of assets.
Anglo American said its underlying operating profit, which is presented before special items and re-measurements, increased 5.9% to USD6.62 billion from USD6.25 billion the previous year, which the company attributed mainly to operational improvements in copper, metallurgical coal and diamonds in the second half of the year and a sharp fall in the price of the South African rand in the final quarter.
The company said it made USD6.26 billion in capital expenditure during 2013, compared from USD6.03 billion in 2012, and its guidance is maintained at USD7.0 billion to USD7.5 billion in expenditure for 2014, with reductions expected in 2015 and 2016.
Anglo American maintained its final dividend at 53 US cents per share, bringing total dividends in 2013 to 85 US cents per share, also the same as in 2012.
However, the company's underlying earnings, which are after special items and re-measurements, fell 6.6% to USD2.67 billion from USD2.86 billion as lower profits attributable to non-controlling interests, which represented a greater portion of profit than in 2012, and higher amounts of taxation hit the company.
Anglo American also announced the deaths of 14 employees and contractors during the year, including six deaths at the company's platinum operations due to falls and moving machinery incidents and a geological event at the company's Amapa floating dock in Brazil, where four people died and two are still missing.
The company said that it did manage to reduce the amount of time it lost due to injuries by 16% during the period compared from 2012 and said it remains focused on achieving zero-harm in the workplace.
On Tuesday, Anglo announced good results from its subsidiary Kumba Iron Ore Ltd's operations for the full year, including a 4.6% increase in its headline earnings to USD1.60 billion for the year from USD1.53 billion the previous year.
The company said on Tuesday that, after a set of adjustments, including depreciation of some assets and corporate cost allocations, the contribution of cash to Anglo American from Kumba also will be up, at USD1.11 billion from USD1.04 billion the previous year.
Kumba Iron Ore controls Anglo American's 69.7% owned major producing Sishen, Thabazimbi and Kolomela mines in South Africa.
In January, the company said it increased production in its fourth quarter for all of its major metals and its exploration and evaluation expenditure for the fourth quarter 2013 totalled USD166 million, a 19% decrease on the previous year, while its total expenditure for 2013 equalled USD533 million, a decrease of 27% on the previous year.
Anglo American said in January that its Kumba Iron Ore Production in South Africa increased by 25% to 11.3 million tonnes in the three months ending 2013, compared from the previous year, mainly due to a strike in the fourth quarter of 2012 which slowed operations.
The company added Friday that its Minas-Rio 26.5 million tonnes per year iron ore mine in Brazil is now 84% complete, and first ore on ship is expected by the end of 2014 with capital expenditure at site on track at USD8.8 billion.
Finally, Anglo American said that it expects the world economy to strengthen in 2014 and 2015 as it emerges from the global financial crisis, and, with major growth expected in China, the company should continue its development, with more improvements to operational processes and performance expected mainly in 2015 and 2016.
Anglo American shares were up 1.5% at 1,556.50 pence after the open Friday.
By Tom McIvor; [email protected]; @TomMcIvor1
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