Paladin’s Fission Uranium takeover delayed by Canada security review
The takeover has faced several hurdles, including a delayed shareholder vote in August and opposition from Fission’s largest investor.
We are going to sell one, two … around 15 assets.
Anglo American (LON:AAL) announced Friday it lost $3 billion during the first half of 2015 and that it would cut 53,000 jobs in the coming years, as a deep rout in commodity prices continue to add strain to battered miners everywhere.
Chief Executive Mark Cutifani said in a presentation to investors that the company is also considering further asset sales as a way of deepening cost cuts. Additionally, the miner will slash about 35% of its total workforce over the next several years, including positions in operations it plans to sell.
The job cuts include the expected loss of 6,000 jobs at overhead operations, including 4,000 jobs in corporate-office operations. The overhead cuts should result in $500 million in cost savings, Cutifani said while announcing the firm was taking a one-time charge of $3.5 billion, including $2.9 billion from a write-down on the value of its massive Minas-Rio iron ore project in Brazil.
However, Anglo maintained its interim dividend of 32 cents per share, something that was under scrutiny since its Kumba Iron Ore unit passed on its own dividend a few days ago.
“Pretty tough” market
The $2.9 billion impairment on Minas-Rio, acquired in 2007, comes just months after a $3.5bn write-down of its value. There was also a $4bn charge in 2013.
The company, which reported half-year profit before tax of $1.9 billion, or 36% less than in the same period last year, said it didn’t expect the commodity price rout to be so dramatic.
“It is a pretty tough market,” said Cutifani, “and in all likelihood the next six months are going to be even tougher.”
Anglo’s operating profits from iron ore more than halved in the period; diamonds dropped 25%; and copper was down 77%.
None of the big diversified miners has suffered as much as Anglo. The stock is trading at its lowest in more than a decade, closing down 3.5% in London Friday.
Mark Cutifani delivering a speech at Mining Indaba 2013, via YouTube.
11 Comments
John
more and more of chapter 11 on the minors will put strong floor on Gold price and others, price can’t go lower than the cost
ExPat
I would not be too sure about that, because there is so much gold already above the ground, and fewer parties that see value in holding it. There certainly are too many precious metals mining companies, and the industry needs to have companies fail, be acquired and merge.
Restless Boomers
You could be wrong, as with fracking, we’ve seen the cost of production fall due to more rapid deployment of state of the art technologies, plus significant price concessions from contractors and suppliers who don’t want to lose any more business than necessary.
It’s a dog eat dog deflationary, beggar thy neighbor world right now, and we’re betting it’s going to get a lot worse before it’s over.
Bottom line, there’s a good chance gold is going further down the rabbit hole than many currently believe possible. Nevertheless, we believe gold is a great long term investment, that is, if you can keep the government from grabbing it or taxing it to death.
Rob Rohena
Tough news for a lot of people in the mining world. A story that would be interesting is to look at how much money companies like Anglo American have spent on brand named hydraulic tools from Hytorc, Enerpac, and others. And then, look at the options which could have saved them over 50%, while not compromising quality.
Pieter van der Watt
My question is this: when everybody was riding on the waves of prosperity, what were the financial fundi`s forecast
for Iron Ore consumption globally and what were they measuring it against? The depth of their finger inside their noses or maybe the part sticking out?
groeg
Gold:Are we at Peak Gold?I think so.With gold Prices receeding for 4 years, many Gold mines will Close.Which means, that less and less Gold will come to the markets.If this is correct, Prices may increase anew.They must increase inspite of Manipulation.
CBob
It’s not my fault…but we need to fire 53,000 employees. Current management is destroying lives with such bad decisions and management still keeps their jobs!
SANJAY SINGH
Stories remain same in last two decades and everyone take
easiest actions. Neither country work on taxes & royalties nor company share
profitability during tough market…..It’s all about money rest all are useless.
Nitish Dobhal
as a graduate student, having dedicated important 5 years of life to the industry, these news are utterly discomforting!
Mike Failla
Sound to me like management needs to fire itself for not doing its due diligence.
paul
Without question this is one of the most incompetent and mis-managed mining giants in the world. The correct solution would be to fire all the pompous and totally clueless management idiots that created this mess not the average blue collar joe.