Glencore plc (GLEN) Ordinary Shares USD0.01
HL comment (5 August 2021)
Glencore reported a first half profit of $1.3bn, compared with a $2.6bn loss last year.
As a result, the board is proposing a special dividend of $530m, equal to $0.04 per share, and a $650m share buyback scheme. This is addition to the $0.12 per share dividend already announced for this year.
The shares rose 1.1% following the announcement.
Full Year Results
Cash profits in the Marketing division fell from $2.2bn to $2.0bn as declines in Energy Products offset improvements in Metals & Minerals. Cash profits decline from $1.4bn to $875m in Energy Products partly reflects an exceptionally strong year in 2020, when a volatile oil price created opportunities. Cash profits from Metals & Minerals rose from $852m to $1.2bn, largely due to improving market fundamentals.
Industrial cash profits rose from $2.6bn to $6.6bn, mainly due to increased commodity prices, especially copper, cobalt, zinc, silver, ferrochrome, nickel and coal. African copper assets made a strong contribution as the Katanga mine is now operating at a steady state. The improvement mainly came in the Metals & Minerals division, where cash profits rose from $2.2bn to $5.9bn. In Energy Products, cash profits rose from $742m to $1.1bn. Industrial capital spending was broadly flat at $1.8bn.
Including readily marketable inventories, net debt fell during the second half from $15.8bn to $10.6bn. Excluding these inventories, net debt fell from $35.4bn to $31.9bn. Free cash flow for the first half was $4.0bn, compared with a $1.7bn outflow last year.
Glencore key facts
- Price/Book ratio: 1.01
- 10 year average Price/Book ratio: 0.98
- Prospective dividend yield (next 12 months): 5.3%
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. 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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