Anglo American plc (“Anglo American” yesterday provided an update to investors and analysts on the Group’s sustained operational and financial performance improvements and outlook.
The briefing will cover guidance for the current and next three financial years, including in relation to capital expenditure and production volumes, and a progress update on Anglo American’s organic growth projects.
Mark Cutifani, Chief Executive of Anglo American, said: “We are building on the complete transformation of both the quality of our portfolio and our performance over the last six years. Anglo American is now amongst the very best in terms of our overall cost curve position as a result of fundamental operating changes, the technical and product marketing expertise we have applied, and the wholesale upgrade of our portfolio. We will continue to upgrade our asset portfolio over time and we see our progress continuing on all fronts as we also bring a number of high quality growth projects online during the next three years, delivering 20-25% production growth by 2023.”
Continued performance improvement during 2019 and confident outlook:
- 2019 unit costs expected to reduce by 5%;
- 2019 total production volumes to again increase;
- 2020 production expected to increase by 3%, with cost inflation largely absorbed by productivity and cost improvements;
- expect to meet $3-4 billion target of incremental annual EBITDA between 2017 and 2022.
Stephen Pearce, Finance Director of Anglo American, added: “We are disciplined in investing to deliver value-adding growth – focused on quality production volumes, margins and returns. As we also progress our share buyback of up to $1 billion, our net debt is naturally increasing, albeit well within our tolerance of <1.5x EBITDA. In the last three years, we have restored a resilient balance sheet, substantially reducing net debt and returning $4.2 billion to our shareholders.
Mark Cutifani concluded: “We expect our next step change in performance to come from a combination of:
- our P101 programme that is achieving new levels of industry best-practice equipment performance across our operations;
- volume growth from existing and new operations, such as Quellaveco; and
the deployment of our FutureSmart Mining™ approach to technology, digitalisation and sustainability. It is this approach that will transform how we discover, mine, process and market our products and how our stakeholders experience our business – environmentally and socially.”
He went on to add that, “Anglo American’s portfolio spans the high quality products that are aligned to the demographic and macro trends of a fast growing and urbanising global population in a cleaner, more electrified and connected world. Combined with our multi-stakeholder mindset to create a sustainable business in all dimensions, we believe we are well set to keep delivering.”