24th Feb 2022 08:45
(Alliance News) - Anglo American PLC on Thursday more than tripled its annual payout, as profit for 2021 more than doubled on the back of strong demand and a considerable rise in commodity prices.
Shares in Anglo American were down 0.6% at 3,510.00 pence on Thursday morning in London, while Johannesburg shares were down 0.9% at ZAR720.56.
The miner posted underlying earnings before interest, tax, depreciation and amortisation of USD20.63 billion, more than doubled from USD9.80 billion in 2020.
This was on revenue that grew 63% to USD41.55 billion from USD25.45 billion, restated from USD30.90 billion to account for a change in Anglo American's accounting policy from a gross presentation to a net basis.
The revenue figure however fell short of consensus expectations of USD42.26 billion in revenue.
Operationally, copper production was essentially unchanged at 647,200 tonnes from 647,400 tonnes in 2020, while iron ore production increased by 3.4% to 63.8 million tonnes from 61.7 million tonnes, as easing Covid restrictions allowed for a rise in output from Kumba Iron Ore, despite unplanned maintenance at Minas-Rio.
De Beers rough diamond production rose 29% in 2021 to 32.3 million carats from 25.1 million as demand recovered from the effect of the pandemic in 2020, while metallurgical coal output declined 11% to 14.9 million tonnes due to the suspension of longwall operations at Grosvenor.
Also driving the rise in profit was commodity price rises, with the blended realised price for iron ore up 41% year-on-year to USD157 per tonne, allowing underlying Ebitda for iron ore to jump 51% to USD6.87 billion.
The average realised copper price grew 52% to 453 US cents per pound from 299 cents a year before, due to a recovery in economic activity and a surge in demand from China, Europe and the US.
The average price for diamonds rose 10% to USD146 per carat from USD133 in 2020 on positive market sentiment.
Anglo American declared a final ordinary dividend of USD1.18 per share, and a special payout of 50 US cents. This brings the total payout for 2021 to USD4.99, up sharply from USD1.00 in 2020.
Looking ahead, Anglo American guided for De Beers diamond output in 2022 to be between 30 million and 33 million carats.
Copper production in Chile is set to range from 560,000 tonnes to 600,000, and output from Quellaveco in Peru has been revised downwards to between 100,000 and 150,000 tonnes.
Meanwhile in iron ore, guidance for Kumba Iron Ore in 2022 is between 39 million tonnes and 41 million tonnes, while Minas-Rio expects iron ore production to range from 24 million to 26 million tonnes.
Financially, Anglo American anticipates capital expenditure to be between USD6.1 billion and USD6.6 billion in 2022. Capital expenditure for 2021 increased 26% to USD5.19 billion from USD4.13 billion in 2020.
"In a year of two distinct halves, we recorded strong demand and prices for many products as economies recouped lost ground, spurred by government stimulus. Copper and [platinum group metals] - essential to the global decarbonisation imperative - and premium quality iron ore for greener steelmaking, supported by an improving market for diamonds, all contributed to a record financial performance, generating underlying Ebitda of USD20.6 billion," said Chief Executive Mark Cutifani.
"Through our integrated technology and sustainability programme, we are well positioned to run the business safely and sustainably, further enhance our competitive position and - disciplined with our capital - deliver value-adding growth as a foundation for future returns," Cutifani added.
By Dayo Laniyan; [email protected]
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