Proving the old stock market adage that it’s better to travel than arrive, shares in Glencore PLC lost 2% of their value in opening salvos – even after reporting record annual earnings and a massive cash hand back.
After an 18% appreciation in the value of the stock in past year, the mining and commodities trading house would have had to spectacularly outperform to move the stock market needle higher, analysts reckon.
Instead, it matched expectations with underlying earnings (EBITDA) of US$34bn for the 12 months ended 31 December 2022.
That figure was up about a third on 2021's benchmark and was driven by the performance of the coal business, which won’t win it too many fans among the environmental lobby.
With that it coupled news of a US$7.1bn cash return, while it also revealed it had eaten into its debt pile, reducing it to a comparatively paltry US$75mln from over US$6bn a year earlier.
Looking ahead, Glencore chief executive Gary Nagle said: "High inflation rates and associated tighter monetary conditions present some risk to the economic outlook in 2023.
“China's reopening, however, together with a continued global focus on energy security and decarbonisation/electrification, mean that demand for many of our commodities is likely to remain healthy, while supply constraints persist and inventories remain relatively low.”