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Anglo American plunges into $1.5-bn net loss in 2012

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(Globalpost/GlobalPost)

Miner Anglo American on Friday posted an annual net loss of $1.49 billion (1.11 billion euros) after taking a $4.6-million hit on the value of its Minas-Rio iron-ore project in Brazil and platinum assets.

The loss after taxation compared with a net profit of $6.17 billion in 2011, Anglo said in a results statement.

That was Anglo American's first net loss in more than a decade as the London-listed miner was also hurt by a sharp fall in global commodity prices.

The dire news comes one day after its Anglo-Australian rival Rio Tinto posted a 2012 net loss of $2.99 billion due to hefty writedowns on its Mozambique coal and aluminium businesses.

That marked Rio's first net loss since becoming a dual-listed company in 1995 and was also due to a dip in commodity markets.

Anglo added on Friday that its operational profit, stripping out exceptional items such as the impairment charge, dived 44 percent to $6.16 billion. That was broadly in line with analysts' expectations. Group sales meanwhile fell 5.9 percent to $28.8 billion.

And the company also hiked its full-year shareholder dividend by 15 percent to $0.53 per share, citing confidence in the underlying business.

"As a result of markedly weaker commodity prices, ongoing cost pressures and an operating loss in our platinum business, Anglo American reported an underlying operating profit of $6.2 billion, a 44-percent decrease," said outgoing Anglo chief excecutive Cynthia Carroll.

Anglo had already revealed late last month that it would take a $4.0-billion hit on the value of its Minas-Rio iron-ore mining project in Brazil owing to delays that have sent costs soaring.

"We recorded impairments totalling $4.6 billion (post-tax) in relation to Minas-Rio and a number of platinum projects that are uneconomical, which is disappointing," added Carroll.

"In platinum, we completed our review in January 2013 and have put forward proposals to create a sustainable, competitive and profitable platinum business.

"We, of course, regret the potential impact on jobs and communities and have designed an extensive social plan to more than offset any such impact."

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http://www.globalpost.com/dispatch/news/afp/130215/anglo-american-plunges-15-bn-net-loss-2012-0