Anglo American PLC (LON:AAL) has returned to the dividend list six months earlier than expected and reported that its net debt has fallen to US$6.2bn, below a year-end target of US$7bn as it reported robust interim results.
The FTSE 100-listed miner posted a 68% jump in underlying earnings (EBITDA) for the six months to June 30 to US$4.1bn, up from US$2.5bn a year earlier and in line with analyst consensus forecasts.
READ: Anglo American says platinum arm to contribute substantially less to first half results
The resumed dividend payment for the first half was set at 48 US cents per share, equal to 40% of the group’s first half underlying earnings, and it said that level would be its dividend policy target going forwards.
In the results statement, Anglo American’s chief executive Mark Cutifani said the benefits of the group’s "relentless focus on driving efficiency" had resulted in "a step-change in operational performance and profitability".
He added: "Looking forward, our focus will continue to be on improving operational performance and converting production and improving costs into consistent cash flow generation, while maintaining strict capital allocation discipline.”
Cutifani concluded: “We are now in a position to consider value accretive growth options and capital returns from within our sUBStantial undeveloped mineral endowment."
Shares rise by over 3%
In early morning trade, Anglo American shares rose by over 3%, or 37.5p to 1,232.5p.
In an initial note to clients, analysts at UBS said: “We see H1 as encouraging due to FCF/deleveraging & dividend.
“However, we are still concerned Anglo is vulnerable to negative spot price momentum/SA headwinds.”
UBS reiterated a ‘neutral’ rating and 1,050p price target on Anglo American.
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