Anglo American has reported its first annual loss since listing in London more than a decade ago, as chief executive Cynthia Carroll prepares to exit the mining group.
Hit by falling commodity prices and $4.6 billion of writedowns, mainly on its troubled Minas-Rio iron ore project in Brazil, the company swung from a $10.8 billion pre-tax profit in 2011 to a loss of $239 million last year.
Anglo American’s fall follows similarly gloomy results from rival Rio Tinto, which on Thursday reported its biggest loss to date, weighed down by $14.4 billion of impairments and the drop in commodity prices.
Presenting her final set of results before stepping down in April, Ms Carroll said lower commodity prices had knocked $3.9 billion from Anglo’s operating profit, which fell 44 per cent year-on-year to $6.2 billion. The group’s full-year figures were also hit by $1 billion of wage inflation.
“The mining industry continues to face significant hurdles, and the impact of these, coupled with our own company-specific challenges, affected our performance in 2012,” she said. “Prices for all the commodities that we produce were down sharply.
“While we are clearly disappointed with the writedown on the [Minas-Rio] project, we remain confident of the quality, size and expansion potential of what is one of the world’s largest undeveloped resources.”
Anglo American took $4.6 billion in impairments for the year to December 31st, including the Brazil writedown and additional impairments at its South African platinum assets.
Anglo American listed in London in 1999 and Ms Carroll took over as chief executive eight years later. She will be replaced by Mark Cutifani, chief executive of AngloGold Ashanti, the South African gold producer.
The mining sector endured a tumultuous 2012, beset with industrial action, as well as cuts to investments and the shelving of projects. – Copyright The Financial Times Limited 2013
