Anglo American Share Price Falls on Mixed Q2 Output Results

on Jul 19, 2013
Updated: Oct 17, 2019
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iNVEZZ.com Friday, July 19th: Anglo American’s (LON:AAL) share price took a dip at the opening bell in London today, as investors stepped up selling after the globally diversified miner yesterday reported mixed production results.

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Anglo American’s copper, platinum and diamond output increased year on year in the second quarter of 2013, while production of iron ore, coal and nickel declined. Through its 69.7-percent shareholding in the South African supplier of seaborne iron ore, Kumba Iron Ore, Anglo saw iron ore production from Kumba’s three mines in the country fall by one percent year-on-year to 11.3 million tonnes due to lower output from its Sishen mine operations, which continue to recover from an illegal strike in the fourth quarter of last year.

The drop in Anglo’s second-quarter iron ore output is in contrast with the performance of mining giants BHP Billiton (LON:BHP) (https://invezz.com/news/commodities/4067-bhp-billiton-share-price-rises-on-strong-output-results) and Rio Tinto (LON:RIO), Rio Tinto Share Price Jumps on Upbeat Output Data, which have reported increases of 17 and seven percent respectively in iron ore output over the same period on the back of expansion of their operations in Western Australia. Yet, Anglo outperformed the other two in terms of increase in copper production, reporting a 14 percent rise to 182,900 tonnes, beating analysts’ forecasts. The increase was based on a 13-percent annual growth in output from its Chilean Los Bronces mine and a 25-percent rise at the Chilean Collahuasi mine, in which it owns a 44 percent stake.

Among other commodities, Anglo’s production of coking coal used in steelmaking fell nine percent to 4.4 million tonnes. Output of thermal coal from South Africa declined five percent to four million tonnes and from Colombia fell three percent to three million tonnes. Nickel production slumped 22 percent to 8,500 tonnes, whereas equivalent refined platinum production rose two percent to 594,000 ounces. Second-quarter diamond production was up 10 percent at 7.9 million carats, largely reflecting favourable ore grades at Orapa and Jwaneng, offset by lower production from Venetia following flooding in January.

**Challenges for CEO Cutifani**
!m[](/uploads/story/4149/thumbs/pic1_inline.png)The mixed second-quarter output data underlines the challenges facing Anglo American’s new Chief Executive Officer Mark Cutifani, as he prepares to unveil his strategy for the underperforming mining group. The CEO is expected next week to give his first public presentation outlining how he intends to tackle the issues facing Anglo, including industrial unrest in loss-making South African platinum mines and huge cost overruns at a large Brazilian iron ore project.

According to the average estimate of four analysts surveyed by Bloomberg News, Anglo American may report a 31 percent plunge in underlying profit to $1.17 billion when it releases interim results for the first half of the year on July 26.
**The Anglo American share price was 1.16 percent down at 1,361.50p as of 09:22 BST today. The stock, which has lost almost 29 percent of its value in the year to date, hit a day’s low of 1,352.00p earlier in today’s trading session in London.**

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