Anglo American Plc reports portfolio simplification and growth progress well on track

Anglo American plc (LON:AAL) has announced its preliminary results 2024.

Strong operational and cost performance – portfolio simplification and growth progress well on track

•    Sale of steelmaking coal and nickel businesses agreed – to generate up to $5.3 billion in gross cash proceeds

•    Underlying EBITDA* of $8.5 billion – EBITDA margin* stable at 30%, despite 10% lower prices and challenging rough diamond trading conditions, supported by flat unit costs and other major cost efficiencies

•    $1.3 billion run rate cost savings achieved in 2024, ahead of schedule

•    Focus on cash conversion* delivers sustaining attributable free cash flow* of $1.7 billion, (2023: $0.1 billion)

•    Loss attributable to equity shareholders of $3.1 billion – recognising net impairments of $3.8 billion

•    Net debt* flat at $10.6 billion – at 1.3x EBITDA, prior to receipt of further divestment proceeds during 2025

•    $0.8 billion total dividends for FY 2024, equal to $0.64 per share, consistent with our 40% payout policy

Duncan Wanblad, Chief Executive of Anglo American, said: “We are fast transforming Anglo American into a far higher margin and more valuable mining company focused on exceptional copper, premium iron ore and crop nutrients assets and significant growth optionality. 2024 saw us transform our performance, with strong operational and cost delivery, $1.3 billion of costs removed on a run rate basis in 2024 with a further $0.5 billion to come by the end of 2025, and major progress with our portfolio simplification.

“Safety is our number one value and first priority, and we continue to make progress towards our goal of zero harm, recording our lowest-ever injury rate in 2024. However, I am sorry to report the loss of three colleagues in the year following two accidents underground in South Africa. We extend our heartfelt condolences to their families, friends and colleagues. We are unconditional in our commitment to safety and working to ensure that every colleague returns home safely each day.

“Group underlying EBITDA of $8.5 billion reflects 10% lower prices and unit costs held flat, demonstrating our focus on operational stability and cost discipline to keep our EBITDA margin stable at 30% (2023: 31%). Far stronger cash conversion enabled us to maintain net debt flat at $10.6 billion, equal to 1.3x underlying EBITDA.

“We are making excellent progress with our portfolio simplification. We have agreed the sale of our steelmaking coal business for up to $4.8 billion in gross cash proceeds and have this week agreed the sale of our nickel business for cash consideration of up to $500 million. The demerger of Anglo American Platinum (AAP) is expected in June and we intend to retain a 19.9% interest in AAP to help manage flowback post demerger and which we expect to exit responsibly over time. All of the above will deliver a step-change in our balance sheet flexibility.

“The work to separate De Beers is well under way, with action taken to strengthen cash flow in the near term and position De Beers for long-term success and value realisation. Given prevailing diamond market conditions, we have reduced our carrying value of De Beers by $2.9 billion.

“In terms of growth, we are progressing our considerable pipeline of high quality options across our portfolio. This is well-sequenced and largely brownfield growth that makes best use of our proven technical and sustainability capabilities, our project delivery track record and our reputation as a responsible mining company.

 “We have moved at pace to set up Anglo American as a highly attractive and differentiated value proposition for the long term, offering strong cash generation to support sustainable shareholder returns and the capabilities and longstanding relationship networks to deliver our full value and growth potential.”

Terms with this symbol * are defined as Alternative Performance Measures (APMs). For more information, refer to page 92.