Mineweb: Anglo American through the ages – by Ciaran Ryan (Money Web.com – June 13, 2019)


It launched South Africa’s industrial age to support its mining activities, but since 2012 has halved the number of its assets. Where to now?

When the EFF’s Julius Malema talks of white minority capital, he is referring of course to Johann Rupert and the Oppenheimers for the most part. These are the families that helped build South Africa and, for better or worse, guided its political discourse in a direction favourable to their business interests.

Anglo American founder Ernest Oppenheimer would be hard put to recognise the group he founded in 1917. By the 1980s it accounted for a staggering 25% of SA’s GDP and owned an estimated 60% of the JSE – the result of an international embargo that forced SA companies to reinvest profits locally, turning the JSE into an incestuous and distended bubble.

The group that built its castle on diamonds and gold in southern Africa is now a very different animal. Since 2012, it has halved its number of assets, but now delivers 30% more product from each retained asset.

That doesn’t mean it is a smaller group. The repurposing of Anglo into a more profitable machine translates into a group that delivers 10% more physical product in aggregate across the portfolio at a 26% lower unit cost (in nominal terms) than in 2012. It’s also doubled the productivity per employee.

There wasn’t a corner of the economy Anglo hadn’t conquered

That’s a long way from where Anglo was in the 1980s. Back then, there wasn’t a corner of the economy that Anglo hadn’t conquered. Think of FNB, Scaw Metals, Highveld Steel, De Beers Diamonds, AECI, paper producer Mondi, Boart International and the British South Africa Company with its mining and agricultural operations across the sub-continent.

For the rest of this article: https://www.moneyweb.co.za/mineweb/anglo-american-through-the-ages/