Anglo American Plc plans to buy back up to $1 billion of shares after the diversified miner reaped bumper profits from its iron ore business, more than offsetting declines in diamond and copper.
Anglo is the first to report earnings among the handful of giant miners that produce iron ore and investors have been preparing for big windfalls. The steelmaking ingredient surged to the highest in more than five years after a deadly Brazilian dam collapse and operational setbacks in Australian caused a supply shock.
The buyback represents a shift for Anglo, which has been focused on repairing its bruised balance sheet and investing in growth while the world’s biggest producers handed massive amounts of money back to shareholders in recent years. The company’s net debt stands at $3.4 billion.
Cutifani said that after paying more than $3 billion in dividends since restarting the payments in 2017, and investing in growth, the buyback was a way of rewarding shareholders who wanted a different kind of return.
“For us it’s not about a short-term sugar rush,” Cutifani said. “It’s about getting the balance right and creating the world’s best mining business over the short, medium and long term.”
For the rest of this article: https://www.bloomberg.com/news/articles/2019-07-25/anglo-plans-1-billion-buyback-after-bumper-iron-ore-profits