Glencore returns to profit, capping turnaround | daily-sun.com

Glencore returns to profit, capping turnaround

    23rd February, 2017 10:04:16 printer

ZURICH: Mining giant Glencore Thursday reported a swing back into profit, completing a dramatic turnaround driven by aggressive cost-cutting and helped by rising commodities prices.


The Switzerland-based company posted a 2016 profit of $1.4 billion (1.3 billion euros), compared to a staggering $5 billion loss the year prior.


When commodity prices nosedived in 2015, investors turned on Glencore amid concerns that the company's towering debt, which had hit $30 billion, could prove unsustainable with the value of its assets in decline.


Chief executive Ivan Glasenberg, seen as a maverick in the mining world, acted boldly to get debt under control.


He scrapped dividends, sold assets and reined in production in a campaign that trimmed debt to $15.5 billion, according to Thursday's results.


That strategy combined with "increasingly favourable fundamentals" in the commodities market has fuelled a much rosier outlook for Glencore's shareholders, Glasenberg said in a statement.


The company was weighing a special 2017 payout to reward investors who stuck with Glencore during darker days, Glasenberg said on a conference call, according to the Bloomberg news agency.


Shares were trading at 333.50 pence on the London exchange in mid-morning, a rise of 2.4 percent.

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