IGO to record impairment against nickel assets in strategy shift
IGO has been undertaking a strategic review in an attempt to revaluate its resources.
Anglo American (LON: AAL) has chosen its South African iron ore unit to begin with planned corporate and head office jobs cuts, citing challenges in moving sufficient volumes to ports due to rail constraints.
Kumba Iron Ore sent notices on Wednesday to 183 employees, the majority of whom work at its head office, Livhuwani Mammburu, spokesperson for National Union of Mineworkers said. He noted the layoffs could be pared back to about 141 workers if the restructuring plan is successful.
The decision comes as Anglo American reported in July a more than 40% fall in underlying earnings for the first six months of the year to $5.1 billion. Kumba’s profit in the period fell by 17% due to the rail challenges and softer prices. As a result, Anglo cut its dividend in half to $700 million from the same period in 2022.
The company also consolidated its production businesses into two regions – The Americas and Africa- Australia. Chief executive officer Duncan Wanblad announced some management changes at the time, continuing with an overhaul of the company’s leadership he began when taking the helm last year.
“As we progress through 2023, market conditions have weakened and we are still not meeting many of our internal performance targets, creating greater urgency for achieving organizational effectiveness and to reduce our business support costs,” Wednesday’s letter said, according to Bloomberg News.
The miner cited a “significant increase in roles and associated costs in the corporate center and the business head offices” as another powerful reason for the retrenchments.
Anglo American added the job cuts were tied to its plans to simplify the company’s structure, but noted it expected “very little impact on its operations.”
The consultation process with staff is expected to end on Oct. 17 and terminations may occur then, it said.
Those terminated will have the opportunity to apply for voluntary severance packages, or early retirement if they are older than 55.
(With files from Bloomberg, Reuters)
