Glencore has released its 2023 full-year financial results with an outlook of expansion in 2024.
Net income for the company fell 65 per cent in 2023 to $6.7 billion ($10.2 billion), with cash generated by operating activities standing at $15.1 billion ($23 billion).
Glencore reported an adjusted earnings before interest, taxes, depreciation, and amortisation (EBITDA) of $US17.1 billion ($26.13 billion), a 50 per cent drop on the previous year.
But Glencore chief executive officer Gary Nagle is looking beyond the drop to the bigger picture.
“Aided by healthy operational cash generation, after funding $5.6 billion of net capex and $10.1 billion of shareholder returns, the 2023 year-end net debt outturn was contained to $4.9 billion vs $0.1 billion in 2022,” he said.
“This distribution… must be contextualised by the significant announcement in November 2023 that we had entered into a binding agreement with Teck Resources to acquire a 77 per cent effective interest in its steelmaking coal business, Elk Valley Resources (EVR) for $6.93 billion in cash.”
Nagle said Elk Valley offers world-class assets, expected to meaningfully complement Glencore’s existing thermal and steelmaking coal production in Australia, Colombia, and South Africa.
“EVR also supports the transition as an input into steel production needed for certain renewable energy infrastructure,” Nagle said.
“As the world moves towards a low-carbon economy, we remain focused on supporting the energy needs of today whilst investing in our transition commodities portfolio.”
In 2023, Glencore acquired a 30 per cent stake in Alunorte and a 45 per cent stake in Mineracao Rio do Norte S.A, allowing the company to secure low carbon, cost effective alumina.
The company also acquired the remaining 56 per cent of the Argentinian MARA copper project, as well as locking in the New Range copper-nickel joint venture with Teck Resources in Minnesota, US.
The additions, along with a near doubling of the Chilean El Pachon’s resource, added more than five billion tonnes to its copper resource inventory for the year.
“While we continue to remain focused on operating safely, responsibly and ethically and creating sustainable long-term value for all our stakeholders, the strength of our diversified business model, across industrial and marketing, focusing on metals and energy, has again in 2023 proved itself adept in a range of market conditions,” Nagle said.
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