As he unveiled a staggering loss of $5.6-billion (U.S.) in his company’s latest results, Anglo American chief executive Mark Cutifani couldn’t resist a few bitter potshots at the grandiose expansion dreams of the global mining industry.
“This industry has destroyed value again and again,” he told his audience of investment analysts in a blunt and scathing commentary on Tuesday. “We spent money on stupid things.”
Minutes earlier, Mr. Cutifani and his executives had been forced to defend Anglo American from questions about its latest credit downgrade. Embarrassingly, the company’s credit rating has just been pushing into “junk” status in a new assessment by Moody’s Investor Service this week, and the analysts wanted to know why.
Huge losses, a credit rating in junk territory, and a denunciation of the habits of its own industry: the barrage of bad news was a new low in the 99-year history of a giant business empire that was once the world’s dominant mining company.
Mr. Cutifani is convinced he can turn around Anglo American by getting rid of two-thirds of its assets and exiting from its less essential businesses in countries like South Africa and Brazil, especially in the coal and iron-ore sectors.
In his answers to the analysts on Tuesday, he insisted that Anglo is entering a new era of “capital discipline” with a focus on a core business of its most promising assets: diamonds, platinum and copper.
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