Glencore Raises Shareholder Returns; Commodity Prices Boosted 1st Half Profit -- Update

By Jaime Llinares Taboada

Glencore PLC said Thursday that it will increase 2021 shareholder returns to $2.8 billion, as higher commodity prices boosted profit and free cash flow in the first half of the year.

The natural-resources major said that it will pay a $530 million special cash distribution in September--equivalent to $0.04 a share--and launch a $650 million share buyback to be completed by the release of its full-year results next year.

The company made a net profit of $1.28 billion in the six months to June, swinging from a $2.60 billion net loss a year earlier.

Adjusted earnings before interest, taxes, depreciation and amortization jumped 79% to a new record of $8.65 billion in the period, the company said.

Revenue rose 32% to $93.81 billion.

"Following Covid-19's severe global impacts in early 2020, the subsequent economic recovery has seen prices of most of our commodities surging to multi-year highs amid accelerating demand and lingering supply constraints," Chief Executive Gary Nagle said.

Glencore's marketing business performed well in this environment and achieved adjusted earnings before interest and tax of $1.8 billion, Mr. Nagle said. However, this was 11% lower than a year earlier, when the division benefited from exceptional oil trading conditions.

The adjusted Ebitda for the industrial business more than doubled to $6.6 billion, benefiting from strong metals prices and expanded mining margins, he said.

Net debt as at June 30 was $10.62 billion, down from $15.84 billion at the end of 2020, and approaching the low end of Glencore's $10 billion-$16 billion target range.

Write to Jaime Llinares Taboada at [e-mail]; @JaimeLlinaresT

(END) Dow Jones Newswires

August 05, 2021 03:00 ET (07:00 GMT)

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