Davis Index: Market Intelligence for the Global Metals and Recycled Materials Markets

Glencore reported its first annual loss since 2015, because of weakness in commodity prices and global pressures. However, the company plans to focus on developing and ramping up its operations across all its locations in 2020, according to Ivan Glasenberg, chief executive officer, Glencore.


The global miner’s 2019 net loss of $404mn resulted from extended uncertainties between the US and China’s trade negotiations, declining prices in its key commodities and some operational challenges faced while ramping up and developing its assets, Glasenberg said. 


The low EBITDA was also attributable to $2.8bn in charges relating to the miner’s Colombian coal mine, Chad oil fields, and African copper and cobalt operations, the company said. The charges included close to $1bn in relation to two Colombian coal operations that faced lower coal prices in Europe resulting from decreased prices for natural gas.


The company’s copper and cobalt operations in Katanga met its production targets in the second half of 2019 despite the challenges associated with its ramp up and development earlier in the year.


Encouragingly, Glencore’s marketing business was in line with its 2018 performance. The business segment reported an adjusted EBIT of $2.4bn in 2019, due to strong oil performance and a stronger metals’ input during the second half which helped offset its challenges related to the metals business in the first half of the year.


The company reported an adjusted EBITDA of $11.6bn, a 26pc decline from $15.8bn in 2018, but above the projections at $11.25bn. Adjusted EBIT was reported at $4.2bn, down 55pc from $9.1bn in 2018.


Glencore’s cash generated by operating activities before working capital changes was down 22pc to $10.3bn from $13.2bn in 2018.

The miner also reported it had made progress on its commitments to a low carbon economy transition. The miner is now targeting a 30pc reduction in absolute scope 3 emissions by 2035 by natural reduction of its oil and coal supply.

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