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Glencore - profits soar with higher commodity prices

Glencore's full year net profit rose to $5.0bn, from a loss of $1.9bn last year.

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Glencore's full year net profit rose to $5.0bn, from a loss of $1.9bn last year. The increase reflects higher commodity prices. Underlying cash profits (EBITDA) grew 84% to $21.3bn.

Net debt has been reduced to $6.0bn, down from $15.8bn last year. As a result, management has recommended a dividend of $0.26 per share and a $550m share buyback.

The shares rose 4.4% following the announcement.

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Full Year Results

Marketing delivered record results due to increased levels of market volatility, cash profits rose 13% to $4.2bn. In Metals and minerals, operating profits grew 50% as nearly all departments rose double digits. Strong performance from coal couldn't offset a drop in oil relative to a bumper prior year, which meant operating profits from Energy fell 21%.

Cash profits in the Industrial division grew 118% to $17.1bn, with growth across both Metals and minerals and Energy products. That reflected higher commodity prices, as the recovery of global demand and supply challenges drove prices higher. Cooper, cobalt, ferrochrome, nickel and coal were the strongest performers.

As of 31 December 2021, the ratio of net debt to underlying cash profits stood at 0.28 times.

Glencore key facts

All ratios are sourced from Refinitiv. Please remember yields are variable and not a reliable indicator of future income. Keep in mind key figures shouldn't be looked at on their own - it's important to understand the big picture.

This article is original Hargreaves Lansdown content, published by Hargreaves Lansdown. It was correct as at the date of publication, and our views may have changed since then. Unless otherwise stated estimates, including prospective yields, are a consensus of analyst forecasts provided by Refinitiv. These estimates are not a reliable indicator of future performance. Yields are variable and not guaranteed. Investments rise and fall in value so investors could make a loss.

This article is not advice or a recommendation to buy, sell or hold any investment. No view is given on the present or future value or price of any investment, and investors should form their own view on any proposed investment. This article has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is considered a marketing communication. Non-independent research is not subject to FCA rules prohibiting dealing ahead of research, however HL has put controls in place (including dealing restrictions, physical and information barriers) to manage potential conflicts of interest presented by such dealing. Please see our full non-independent research disclosure for more information.

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Written by
Matt-Britzman
Matt Britzman
Equity Analyst

Matt is an Equity Analyst on the share research team, providing up-to-date research and analysis on individual companies and wider sectors.

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Article history
Published: 15th February 2022