Glencore Plc, the world’s biggest commodity trader, improved its earnings forecast for its trading division after coal and zinc prices rallied to the highest in at least four years.
Earnings before interest and tax will be $2.5 billion to $2.7 billion for this year, Baar, Switzerland-based Glencore said in a third-quarter production statement Thursday. That’s a slight improvement on its previous estimate of $2.4 billion to $2.7 billion. The company didn’t give a reason for the revised forecast.
“This reflects improved trading conditions within the coal division,” Credit Suisse Group AG analysts led by Liam Fitzpatrick wrote in a note. Billionaire Chief Executive Officer Ivan Glasenberg has been turning around the business after a troubled 2015 which saw investors dump the stock on concerns its debt was too high to weather a prolonged downturn in commodities.
That prompted the firm to suspend its dividend, rein in spending and sell $2.5 billion of new shares. Glencore’s rebound this year has made it the second-best performer in the U.K.’s benchmark stock index.
The company has largely completed its plan to sell $4 billion to $5 billion of assets this year and will meet its net debt target of as low as $16.5 billion by the end of the year, according to UBS Group AG.
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