Glencore has reported a mixed bag of financial results for the first half of 2024 as the mining and metals giant grapples with market normalisation, commodity price fluctuations, and ongoing concerns about demand from China. It has also decided to retain its coal business, rolling back on plans to sell the unit.
Glencore’s Adjusted EBITDA plummeted by 33% to $6.3 billion, with the company’s coal operations accounting for a $2.7 billion reduction in earnings due to substantial falls in key thermal coal pricing benchmarks.
While net income attributable to equity holders before significant items stood at $1.5 billion, the company actually reported a net loss of $233 million after accounting for $1.7 billion in significant items, including around $1 billion in impairment charges.
The Marketing Adjusted EBIT, a key indicator of the company’s trading performance, fell by 16% to $1.5 billion. This decline was partially offset by a strong showing in the metals sector, highlighting the diverse nature of Glencore’s operations.
In a surprise move, Glencore’s board has decided to retain its coal and carbon steel materials business following extensive shareholder consultation. This decision aims to enhance the company’s cash-generating capacity and fund opportunities in transition metals.
“Critically, we have also clarified the immediate future of our coal and carbon steel materials business,” said Glencore’s Chief Executive Officer, Gary Nagle.
“Following completion of the acquisition of EVR in early July, we undertook an extensive consultation with shareholders and based on the outcome of that process and the Group’s own analysis, Glencore’s Board, considering both risk and opportunity scenarios, endorsed the retention, rather than demerger, of the coal and carbon steel materials business, as currently providing the optimal pathway for demonstrable and realisable value creation for Glencore shareholders.”