Anglo American set for commodity slump-triggered charge
Anglo American (LON:AAL) warned Wednesday it will likely write down the value of some of its main iron ore and coal mining assets on last year's results, becoming the first major miner to openly accept the toll that slumping commodity prices are taking on the global mining sector.
The company, which reports its full-year results next month, didn’t provide further details of the upcoming financial hit. However, the warning is in line with other large companies gloomy forecasts, including those of Freeport-McMoRan (NYSE:FCX), Caterpillar (NYSE:CAT) and — most recently — Glencore (LON:GLEN).
Delivering its fourth quarter results, Anglo provided almost no surprises. Coal and iron ore output increased, while copper production dropped.
Anglo’s platinum unit Amplats, which is the world’s biggest producer of the metal, produced 14% more (593,900 ounces) in the last quarter of 2014 as operations returned to normal following a five-month strike by the largest union that ended in June. Annual output was 1.84 million equivalent platinum ounces.
Last month, the company’s chief financial officer, Rene Medori, flagged potential write-downs to Anglo’s Brazilian Minas Rio iron ore operations and metallurgical coal assets, such as its Canadian Peace River mine.