Interim Results 2013
26 July, 2013
Anglo American announces underlying EBITDA(1) of $4.7 billion and underlying operating profit(2) of $3.3 billion for the half year
Financial results impacted by weaker prices, partially offset by exchange gains and improved production
- Group underlying operating profit of $3.3 billion, a 15% decrease
- Underlying earnings(3) of $1.3 billion, underlying EPS of $0.98
- Profit attributable to equity shareholders(4) of $0.4 billion
- Net debt(5) of $9.8 billion at 30 June 2013
- Attributable ROCE(6) of 11%
Safety
- Eight employees and contractors lost their lives, and a further two remain missing, in work related incidents. Our safety programmes continue to drive for zero harm, focusing on operational risk management and learning from incidents
Disciplined capital allocation
- Interim dividend maintained at 32 US cents per share, reflecting the Board’s commitment to maintaining an investment grade rating and to providing a base dividend, which will be maintained or increased through the cycle
- 2013 capital expenditure reduced by $1.0 billion reflecting deferrals of spending in light of current market environment and more stringent capital allocation framework
Cash flow uplift of $1.3 billion p.a. targeted by 2016, with further potential to drive attributable(6) ROCE in excess of 15% target
- New business process model to drive clear accountability and a step change in operational performance and project execution
- Commercial and marketing overlay target of $500 million p.a. (including $100 million from supply chain)
- Organisational structure and overhead savings of $500 million p.a. targeted
- Rigorous capital allocation focused on value realisation – $300 million p.a. targeted savings from early stage project studies
- Achieving the right balance between value adding growth and shareholder returns
Operational performance
- Solid operational performance and strategic focus on margin preservation partially offset substantially lower commodity prices and the impact of industrial action
- Kumba Iron Ore – continued strong performance at Kolomela offset the impact of Sishen strike and higher waste stripping
- Metallurgical Coal – improved productivity and cost reduction initiatives drove an 18% decrease in unit costs at the Australian export operations partially offsetting a 21% decline in export metallurgical coal prices
- Copper – improved efficiency and recovery in production from Los Bronces and Collahuasi resulted in a 7% increase in production, helping to achieve broadly flat unit costs, despite the high mining inflation environment
- Platinum – restructuring proposals consultation process concluded with the South African Department of Mineral Resources (DMR), and the section 189 Labour Relations Act process resumed on 10 June 2013
Project update
- Minas-Rio 26.5 Mtpa iron ore pellet feed (wet tonnes) (Brazil) – progress in line with plan; FOOS end of 2014
- Grosvenor 5.0 Mtpa Metallurgical Coal (Australia) – capital costs of $1.95 billion, an increase of $0.25 billion primarily due to geotechnical changes; longwall production end of 2016
HIGHLIGHTS |
6 months ended 30 June 2013 |
6 months ended 30 June 2012(8) |
Change |
---|---|---|---|
Group revenue including associates and joint ventures(7) | 16,193 | 16,408 | (1)% |
Operating profit including associates and joint ventures before special items and remeasurements (2) |
3,262 | 3,826 | (15)% |
Underlying earnings(3) | 1,250 | 1,738 | (28)% |
Underlying EBITDA(1) | 4,709 | 5,067 | (7)% |
Net cash inflows from operating activities | 3,167 | 2,665 | 19% |
Profit before tax(4) | 1,994 | 3,035 | (34)% |
Profit for the financial period attributable to equity shareholders(4) | 403 | 1,254 | (68)% |
Earnings per share (US$): | |||
Basic earnings per share(4) | 0.31 | 1.02 | (70)% |
Underlying earnings per share(3) | 0.98 | 1.41 | (30)% |
Dividend per share | 0.32 | 0.32 | - |
Attributable ROCE(6) | 11% | 14% | (3)% |
(1) Underlying earnings before interest, tax, depreciation and amortisation (underlying EBITDA) is operating profit before special items and remeasurements, depreciation and amortisation in subsidiaries and joint operations and includes attributable share of underlying EBITDA of associates and joint ventures. See note 2 to the Condensed financial statements.
(2) Underlying operating profit includes attributable share of associates’ and joint ventures’ operating profit (before attributable share of associates’ and joint ventures’ interest, tax and non-controlling interests) and is before special items and remeasurements, unless otherwise stated. See note 2 to the Condensed financial statements. For the definition of special items and remeasurements see note 4 to the Condensed financial statements.
(3) See notes 3 and 8 to the Condensed financial statements for basis of calculation of underlying earnings.
(4) Stated after special items and remeasurements. See note 4 to the Condensed financial statements.
(5) Net debt includes related hedges and net debt in disposal groups. See note 11 to the Condensed financial statements.
(6) Attributable ROCE is the annualised underlying operating profit on adjusted capital employed attributable to equity shareholders of Anglo American, and therefore excludes the portion of the annualised underlying operating profit and capital employed attributable to non-controlling interests in operations where Anglo American has control but does not hold 100% of the equity. Adjusted capital employed is the average of net assets excluding net debt and financial asset investments, adjusted for remeasurements of a previously held equity interest as a result of business combination and impairments incurred in the current year.
(7) Includes the Group’s attributable share of associates’ and joint ventures’ revenue of $1,788 million (six months ended 30 June 2012: $2,772 million). See note 2 to the Condensed financial statements.
(8) Certain balances related to 2012 have been restated to reflect the adoption of new accounting pronouncements. See note 1 to the Condensed financial statements.
View full PDF of this press release (1.24MB, link opens in a new window)