Anglo American Releases Q3 Results, Reporting Lower Copper and Diamond Output

Anglo American (LSE:AAL,OTCQX:AAUKF) shared its third quarter results on Thursday (October 24), reporting declines for copper and diamond output, as well as for other commodities in its portfolio.

The multinational mining corporation’s copper output decreased 13 percent year-on-year due to lower recoveries and necessary maintenance at major sites, while diamond production, which is managed by the firm's De Beers subsidiary, saw a 25 percent drop year-on-year on the back of weak demand, particularly from the Chinese market.

In total, Anglo produced 181,000 metric tons of copper in Q3, with diamond output of 5.6 million carats.

Despite the decrease, Anglo is upholding its annual copper guidance of 730,000 to 790,000 metric tons.

The company said its third quarter diamond production was lower in response to a slowdown in global demand, with reduced consumer spending in luxury sectors worldwide affecting buying.

De Beers is now considering further output adjustments to address overstocking issues affecting the midstream diamond market, which is the section of the supply chain responsible for processing and distribution.

In May, Anglo announced its intention to offload De Beers as part of restructuring efforts. No update was shared in its Q3 results, but Chief Executive Duncan Wanblad said in September that the plan was still in place.

The firm is looking to shift its focus to metals integral to renewable energy technologies, including copper.

The restructuring comes after Anglo fended off a takeover bid from BHP (ASX:BHP,LSE:BHP,NYSE:BHP) earlier this year. It defended its position with plans to prioritize copper and iron ore, while looking to exit several other business areas, including its steelmaking coal assets in Australia and its platinum-group metals operations in South Africa.

Anglo's platinum-group metals output declined in Q3 as well, sinking 10 percent year-on-year to come in at 922,000 ounces. The miner said the decrease is in line with its 2024 guidance and reflects expected production levels.

The company’s steelmaking coal segment faced setbacks following a fire at the Grosvenor mine in Queensland, Australia. The incident led to a 6 percent decrease in production year-on-year, with output expectations for 2024 adjusted to 14 million to 15.5 million metric tons, down from an initial 15 million 17 million metric tons.

Anglo is in the midst of reviewing final bids for the sale of its steelmaking coal unit, with an agreement expected to be executed in the coming months. The demerger of its platinum-group metals division is anticipated in mid-2025.

Iron ore production increased 2 percent year-on-year to reach 15.7 million metric tons, driven by stable operations in South Africa and Brazil. Anglo's nickel output rose 6 percent from the year-ago period.

It also produced 406,000 metric tons of manganese ore, a fall of 60 percent-year-on-year.

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Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.