LONDON (Reuters) – Glencore (GLEN.L) reported a 32% drop in first-half core profit on Wednesday, sending its shares to their lowest since late 2016, while a fall in cobalt prices prompted it to halt output for two years at the world’s biggest mine of the battery material.
Adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) were $5.58 billion for the six months ended June 30 against $8.18 billion a year earlier.
The company’s shares were trading nearly 2% lower by 1139 GMT, recovering slightly from losses that took them to their weakest since October 2016. Chief Executive Ivan Glasenberg blamed “a challenging economic backdrop for our commodity mix” and setbacks during the ramp-up of operations in Africa.
Glencore stands apart from other diversified miners because of its high-profile trading division and an appetite for risk that in the past has appealed to investors.
It initially rebounded strongly from the commodity crash of 2015-16. But cobalt, which was meant to be part of Glencore’s strategic advantage as the world switches to electrification, has become a liability.
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