Glencore, one of the world’s largest commodity traders, is considering leaving the London Stock Exchange. The company’s shares have dropped by 7%, and its earnings have dipped. Glencore’s profits have fallen for two years in a row.
Lower coal prices have hurt the company’s bottom line. Glencore’s net debt has also risen more than analysts expected. The company worries about keeping its operations going in the current economic conditions.
Glencore might move its primary listing to the New York Stock Exchange. This could help the company attract more investors and improve its financial situation. Glencore has announced a $1 billion share buyback program despite lower earnings.
Glencore considers New York listing
The company plans to return $2.2 billion to shareholders through cash distributions and buybacks. This shows that Glencore is confident in its financial position, even though its operating profit has fallen.
Glencore’s adjusted earnings before interest, tax, depreciation, and amortization (EBITDA) fell to $14.4 billion in 2024, down from $17.1 billion in 2023. The company’s adjusted earnings before interest and tax (EBIT) fell by a third. Lower average energy coal prices are the main reason for this decline.
Glencore CEO Gary Nagle said, “Operationally, 2024 was a strong year for Glencore. Our Industrial assets delivered full-year production numbers within their original guidance ranges, and the addition of EVR’s steelmaking coal volumes from July 2024 resulted in a 4 percent growth in copper-equivalent volumes year-over-year.”
Glencore’s capital expenditure has increased, but its net debt remains low at $3.7 billion. This could allow the company to take big strategic actions.
There have been rumors that Glencore might consider merging with mining rival Rio Tinto. This could help the companies navigate the energy transition and secure access to metals needed for renewable energy.
