Glencore to cap coal production as full year earnings rise
Miner responds to investor pressure on climate change
Company unveils $2bn share buyback
Glencore said full year adjusted earnings increased 8% to $15.8bn as it announced plans for a $2bn share buyback and a cap on coal production in response to pressure for action on climate change.
Describing the period as “challenging”, the said the buyback program would run until the end of 2019 and be topped up if commodity prices remained robust.
Adjusted earnings before interest and tax were $9.14bn compared with $8.55bn a year earlier and below forecasts of $9.89bn.
Glencore said it would cap thermal and metallurgical coal at around current guidance levels of 145m tonnes a year and restrict acquisitions.
“We recognise climate change science as set out by the United Nations Intergovernmental Panel on Climate Change,” the company said.
“To deliver a strong investment case to our shareholders, we must invest in assets that will be resilient to regulatory, physical and operational risks related to climate change.”
The company wrote down $600m on its Mutanda mine in the Democratic Republic of Congo and said it would halve copper production at the operation this year to 100,000 tonnes.
Glencore has faced difficulties in the country after the government implemented a new mining code that increased taxes and royalties.