Mining giant Anglo American reported plummeting profits as it released its results for the first half of the year on Friday.
The group — which rejected a merger proposal from rival Xstrata last month — said underlying earnings slumped by almost 70% in the first half of the year as the global meltdown took its toll on demand for commodities.
Pre-tax profits slumped to $3,63-billion from $6,47-billion on revenues of $11,1-billion, a decline of 38%.
Underlying earnings brought even worse news as they reflected a decline to $1,1-billion from $3,48-billion.
It did not announce a dividend for the first half of the year.
However, Anglo American ‘s CEO, Cynthia Carroll, pointed out the group was on track to achieve more than $1-billion in cost savings for 2009.
”We are also ahead of plan towards our global headcount reduction, with a reduction of 15 405 already achieved out of a total reduction of 19 000 planned for the year.”
Looking ahead, Carroll said that ”after a rate of market decline that has been unprecedented”, she expected demand to remain soft in the near term until OECD (Organisation for Cooperation and Development) countries began to recover materially.
”China continues to grow strongly and is key to demand, particularly for iron ore, copper and platinum.
”While we have seen some recovery in metals prices, macro economic indicators are mixed and the economic outlook remains uncertain in the near term; however, the fundamentals for the medium to longer term remain highly attractive,” Carroll said. — Sapa