Newly appointed Anglo American chief executive Mark Cutifani has gone back to the drawing board, adopting a strategy that is diametrically opposed to that of his predecessor, Cynthia Carroll, in a bid to bring returns to disgruntled shareholders.
Whereas Carroll spent her tenure looking for new, and as it turns out expensive, acquisitions, Cutifani plans to cut $3.5-billion in costs by 2016 to increase the return on capital employed to 15% from the 8% it is at present.
He plans to do this by improving efficiency and reviewing operations, which he started in April when he took up his new position.
Cutifani will report back next month on Anglo American's progress and he has already shown his resolve by selling the group's holdings in a Brazilian iron ore project and the Pebble Limited copper project in Alaska, which has been dogged by protests over its impact on the environment.
The markets did not react immediately after Cutifani's presentation of the company's interim results in London in July.
It appears from conversations with analysts that they are waiting to see whether he is going to deliver on his promises and on the outstanding 90 projects he is reviewing.
Profits down
The company reported in July that group operating profits were down 15% at R3.3-billion. However, he said at the presentation that, "adjusting those earnings for price movements and foreign exchange movements, our underlying performance is about 10% better than we were at this time last year, so there has been an improvement."
Frank approach to getting Anglo assets in gear
So what has Mark Cutifani, Anglo American's chief executive, accomplished in his first few months?
He has been praised, particularly by the financial press, for his frankness about some of the challenges facing the company, with foreign media reporting that he informed analysts at the July presentation in London that "we need to get our arses into gear".
One mining expert said the company Cutifani inherited was in a "shambles".
This is considered an overstatement by some, but the former AngloGold Ashanti chief executive is credited with turning around that struggling company in a short time by winding down a loss-making hedge book.
He has certainly been presented with an enormous challenge. He said the review of the group's 95 operations and projects was well under way and should be completed by November.
In late September, Anglo American said it was satisfied with progress on the Minas-Rio iron ore terminal and expects the first exports to begin in late 2014.
A number of delays
The project has seen a number of delays. It will have an initial capacity to mine and ship 26.5-million tonnes of ore.
Cutifani, who started in April, had said that he felt there was a greater need for Anglo American to explore its commercial potential.
In May, it was announced that the group was to open sales hubs in London and Singapore to "strengthen their relationship with customers in Asia and Europe".
The company said it was bringing together the commercial activities of its current locations where the businesses are based, namely Australia, South Africa and Brazil, among others.
Although thermal coal is handled in London, a team in Australia is handling most of the coking coal market.
The bulk of South Africa's coal exports go to Asia. Cutifani has said that Anglo is not considering a wholesale sell-off of assets.
"We have a very strong platform of assets to work from, the quality of those assets surprised me on the upside.
"It's not about making wholesale or radical changes at the operating level but about introducing a much more disciplined approach to planning and execution and delivery of the objectives we have."