Anglo American laying off up to 20% of its staff as investors press for further savings
Global miner Anglo American (LON:AAL) is said to be about to announce the dismissal of between 5% and 20% percent of its employees at all of its head offices as investors demand more actions to pull the company through the commodities slump.
According to sources quoted by Reuters, the miner is likely to announce the cuts while publishing its first-half results at the end of the month.
Anglo, which employs over 150,000 staff globally, is undergoing a major restructuring aimed to improve its balance sheet. The plan has included cutting jobs and putting assets up for sale, from copper mines in Chile to Australian coal assets and its platinum business in South Africa.
But unlike its peers, the group has not introduced major cuts to capital expenditure, at least not in 2014, and its net debt is not expected to peak until later this year at up to $14 billion.
When Cutifani took over as chief executive in 2013, he criticized a culture of missed targets and underperformance. More than two years on, the former boss at AngloGold Ashanti, has improved Anglo’s operating capability, but the company’s value is still in the pits.
Currently, the group is worth a bit over US$20 billion (£13.12) after its stock has fallen almost 23% so far this year. And while investors have been being somehow patient with the firm’s lack of progress on promised asset sales, they are now demanding further initiatives to adjust to a commodity price rout that has hit profits. In particular, they want more effort put into cutting expenses and improving productivity.
“A sense of urgency seems to be lacking. More of that would be desirable … You can’t hang on to something forever when everybody knows it’s an unwanted asset,” Ian Woodley, portfolio manager at Old Mutual, a shareholder in Anglo American and Amplats, told Reuters Thursday. “They are quite good at promises. Delivery tends to be slower than you would be happy with.”