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Anglo American PLC on Thursday reported a mostly weaker production performance for the first half of 2022, with declines in copper, platinum group metals and iron ore output.
For the six months ended June 30, the miner posted a 17% drop in copper output to 273,000 tonnes from 330,000 tonnes the same period a year before, driven by planned lower grades from the Los Bronces and El Soldado mines in Chile.
For 2022 as a whole, Anglo American's copper guidance remained between 660,000 and 750,000 tonnes.
Steelmaking coal production fell 22% year-on-year to 4.8 million tonnes from 6.2 million tonnes, as a result of the planned end of production at the Grasstree operation in Australia in January and record unseasonal rainfall in May at the open pit operations.
Due to the prospect of further unseasonal wet weather, Anglo has lowered its coal guidance to between 15 and 17 million tonnes, from 17 and 19 million tonnes.
Total PGM output for the first half of 2022 dropped 4.3% to 1.99 million ounces from 2.08 million ounces, driven by lower production from the Mogalakwena mine in Limpopo, South Africa.
Anglo American Platinum Ltd, a Johannesburg-listed subsidiary of Anglo American, has kept its PGM guidance range between 3.9 million to 4.3 million ounces, subject to potential Eskom loadshedding and Covid-related disruption.
In addition, for the six months ended June 30, Amplats expects basic and headline earnings to come between R 23 billion and R 28 billion, around £1.12 billion and £1.36 billion. This would be between 40% to 50% below R 46.4 billion achieved a year prior, as a result of a lower rand basket price and a decline in sales volumes.
Iron ore production from Minas-Rio in Brazil decreased 15% to 9.8 million tonnes from 11.5 million tonnes, mainly as a result of 20 days of planned maintenance carried out in the second quarter.
Guidance for Minas-Rio's output in 2022 remained unchanged at 22 million tonnes to 24 million tonnes.
Kumba Iron Ore Ltd, a Johannesburg-listed subsidiary of Anglo American, posted a 13% fall in iron ore output to 17.8 million tonnes from 20.4 million tonnes, as a safety intervention led to a decline from the Kolomela mine.
Sales volumes meanwhile remained flat at 19.6 million tonnes. Kumba's production guidance for 2022 remains at 38 million tonnes to 40 million tonnes.
Financially, for the first half of 2022, Kumba expects headline earnings to come between R 10.87 billion and R 12.03 billion, a 48% to 53% decline from R 23.34 billion a year before.
Basic earnings are set to range from R 10.83 billion and R 11.99 billion, marking a 49% to 54% fall from R 23.35 billion, as a result of lower average realised FOB export iron ore prices.
For Anglo American, only diamond production from the De Beers business achieved a positive result, rising 10% to 16.9 million carats from 15.4 million carats, driven by a jump from the Benguela Gem in Namibia since the early delivery of a new diamond recovery vessel.
Anglo American's guidance for diamond output for the year was increased to between 32 and 34 million carats, from prior guidance of 30 million carats to 33 million.
‘Our production performance started to pick up in the second quarter of 2022, with operational momentum and our focus on asset resilience positioning us well for a stronger second half of the year. Full year production guidance is unchanged for PGMs, copper and iron ore, increased for diamonds and decreased for steelmaking coal due to longwall ramp-up timing,’ said Chief Executive Duncan Wanblad.
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