San Francisco Frontiers - Asset writedowns push Glencore into $1.6 bn loss for 2024

The $1.6 billion net loss for fiscal year 2024 compared to a net profit of nearly $4.3 billion the previous year, the company said in a statement.

The group took charges to write down the value in its accounts of its coal operations in South Africa, and the Koniambo nickel mine in New Caledonia.

Excluding such exceptional items, the company said it would have posted a net profit of $3.7 billion.

Chief executive Gary Nagle said "operationally, 2024 was a strong year for Glencore" with its industrial mining operations meeting their performance targets.

Adjusted operational earnings from these operations came in at $10.6 billion, a drop of 20 percent from 2023, which the company said was "primarily driven by lower energy coal prices".

While mining rivals Rio Tinto or Anglo American have pulled out of coal mining, Glencore boosted its involvement in this market by buying Elk Valley Resources (EVR) from Canada's Teck Resources for $7 billion last year.

Glencore's commodities trading business generated adjusted operational earnings of $3.2 billion, an eight percent drop from 2023 due to the "progressive normalisation of energy markets from the severe disruption and extreme volatilities seen in 2022/23".

That disruption and extreme volatility in energy markets driven by Russia's invasion of Ukraine helped Glencore post a record profit of $34.1 billion, allowing it to return $7.1 to shareholders in dividends.

Despite the net loss Glencore plans to distribute $2.2 billion to its shareholders via dividends and share buybacks.

The group said it expects to receive in the coming months $1 billion in cash from the sale of its stake in Canadian grain handling company Viterra to Bunge, plus shares in the US-Swiss agribusiness.

F.Young--SFF