Anglo American confirms 2021 guidance and value accretive 35% growth over next decade

2021-12-14T06:30:38+00:00 December 14th, 2021|News|

Anglo American plc provided updates to the investment community on its strong operational and financial performance during 2021 and its sector-leading growth on Friday 10 November. This update included the latest guidance for the current and next three financial years in relation to capital expenditure and production volumes, and a progress update on Anglo American’s growth projects.

Mark Cutifani, Chief Executive of Anglo American, said, “Covid-19 has continued to pose challenges in 2021 particularly in those countries where vaccination uptake has been lower. We have kept our focus on keeping our employees and communities safe and encouraging vaccination at the earliest possible opportunity. We need to continue being prudent with this virus and we will continue putting the safety and health of our employees first.

“Anglo American is a resilient and agile business that is set to deliver 35% growth over the next decade at an attractive 50% margin. We are also increasing our near-term performance improvement target to USD3.5 – USD4.5-billion by 2023, as we accelerate the delivery of our P101 and technology programmes, while also bringing growth projects onstream. First and foremost is our Quellaveco project in Peru in mid-2022, where we have also increased early copper production plans to create additional value.

“We are clear that climate change is the defining challenge of our time, and we have a crucial role to play in supporting the transition to a low carbon economy by producing many of the metals and minerals that enable decarbonised energy and transport. Of course, we are also moving at pace to reduce our own emissions and have committed to operate carbon neutral mines by 2040, while having an ambition to reduce our scope 3 emissions by 50% in that same timeframe.”

 Anglo American maintained a strong performance during 2021 and expects further improvement in 2022, with highlights being:

  • 2021 production up 7%: strong PGMs performance and higher rough diamond demand;
  • 2021 unit costs up 10% (1)above CPI inflation and some production slowdowns;
  • 2021 capex of USD5.2-billion: lower due to Covid delays and supply chain disruptions;
  • 2022 unit costs expected to increase by 4%;
  • 2022 forecast capex of USD6.2 – 6.7-billion, reflecting 2021 deferrals and Woodsmith project addition.

Stephen Pearce, Finance Director of Anglo American, commented, “Our balanced approach is supporting sequenced investment in value accretive growth and considerable long term business improvement, alongside attractive shareholder returns. We have delivered USD10.3-billion in cash returns to our shareholders since 2017 and USD4-billion in H2 2021 alone. Our ongoing investment in the business also supports our emissions reduction objectives and we therefore expect our normal cycle of capital investment to continue to fund the majority of our operational decarbonisation projects.”

Mark Cutifani added, “Anglo American offers an increasingly differentiated investment proposition centred around sustainable performance and high quality, responsible growth. Combined with our integrated approach to technology in pursuit of the safer and more sustainable supply of materials essential to the energy transition and growing consumer demand patterns, we are well positioned to meet the expectations of our full breadth of stakeholders across society.”

(1) 2021 unit costs up 10% on a FX neutral basis; increase of 16% including FX.

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