Anglo American posted preliminary results for 2015. Group underlying EBIT were $2.2 billion, a 55% decrease.
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This is due to sharply weaker commodity prices ($4.2 billion underlying EBIT impact), partially offset by weaker producer country currencies ($1.8 billion underlying EBIT benefit) and incremental cost reductions.
CEO Mark Cutifani said: “The global economic environment and its impact on prices have presented the industry with significant challenges during 2015.
“Against the strong headwinds of a 24% decrease in the basket price of our products for the year as a whole, our ongoing intense focus on operational costs and productivity delivered a $1.3 billion EBIT benefit in the year, providing some mitigation.
“Overall, our copper equivalent unit costs reduced by a further 16% in US dollar terms, representing a 27% total reduction since 2012.
“Our portfolio transformation is well on track, from c.65 assets in 2013 to 45 today. We completed or announced $2.1 billion of disposals in 2015, including from the sale of our 50% interest in Lafarge Tarmac and the Norte copper assets in Chile, while also agreeing the sale of the Rustenburg platinum operations and two non-core coal assets in Australia, which we expect to complete during 2016.
“Together with operational and cost improvements, significant capex reductions and making the tough decisions with some of our more marginal assets, we have been able to maintain our net debt and liquidity levels at $12.9 billion and $14.8 billion respectively, despite our $4 billion of capital commitments for 2015 and the $2.4 billion net EBIT erosion from lower prices and weaker producer country exchange rates.
“We have made significant progress, albeit in an environment that has been deteriorating at a faster pace.
“Today we are announcing detailed and wide-ranging measures to sustainably improve cash flows and materially reduce net debt, while focusing on our most competitive assets to create the new Anglo American, positioned to deliver robust profitability and cash flows through the cycle.†■