Anglo American PLC's (LSE:AAL) interim results next Thursday are expected to show stronger copper profitability offset by weaker iron ore pricing and losses from businesses being prepared for sale.
The miner's second-quarter production update this week was broadly reassuring, with copper and iron ore output around 1% ahead of expectations, according to Deutsche Bank.
UBS, which retained a 'buy' rating and 4,600p price target, warned that first-half EBITDA could undershoot the $3.9 billion consensus. Analyst Myles Allsop forecasts $3.6 billion.
Copper should provide the main bright spot after Anglo cut its unit-cost guidance by around 15% to 145 cents per pound, helped by stronger by-product credits and improved treatment charges.
Production of 173,000 tonnes met expectations, while output guidance remained at 700,000-760,000 tonnes.
Concerns had centred on Collahuasi following the temporary suspension of its desalination plant. However, Deutsche analyst Liam Fitzpatrick said this week's update indicates the mine performed in line with expectations and remained on course for a grade-driven recovery in 2027.
UBS expects lower copper costs to be offset by weaker realised iron ore prices, reflecting higher freight charges and the redirection of cargoes from Bahrain to China.
Steelmaking coal and De Beers are also expected to have been EBITDA-negative during the first half.
Anglo recently agreed to sell its Australian coal operations to Dhilmar for up to $3.88 billion, while discussions over the disposal of De Beers are "progressing".
Investors are also likely to look for confirmation that Anglo's merger with Teck Resources remains on track for completion between September and March.
