Glencore loses about $1.78 billion in value after reporting H1 results

Glencore PLC (LON: GLEN) says its profit declined in the first six months of this year as energy markets weakened and resulted in lower commodity prices.

Glencore reports a 50% hit to adjusted EBITDA

The multinational also blamed inflation and limited economic growth (globally) for weakness in H1. Still, Gary Nagle – the Chief Executive of Glencore said in the press release today:

The strength of our diversified business model across industrial and marketing, focusing on metals and energy, has again proved itself adept in a range of market conditions.

Nonetheless, the London-listed firm ended the first half with $4.57 billion of net profit – down sharply from $12.09 billion last year. Its adjusted EBITDA also tanked 50% year-on-year to $9.40 billion.

The annualised decline was broadly expected – but what disappointed investors was that the figure came in even shorter of the consensus. For that reason, the mining stock lost over 3.0% this morning which translated to a $1.78 billion hit to the company’s valuation.

Glencore PLC remains constructive on the future

Note that Glencore still remains positive for the remainder of this year and expects moderating inflation as well as strength in China to serve as catalysts in H2.  

We look to the future confident that we have right pathway to succeed in net-zero economy and create sustainable long-term value for all stakeholders.

Glencore PLC confirmed on Tuesday that it has raised the total shareholder returns for 2023 to about $9.3 billion, including $1.2 billion worth of share repurchase and about $1.0 billion in special cash distribution.

As of the end of June, the commodity trading and mining company had $1.54 billion in net debt on the balance sheet versus $75 million only at the start of 2023.