Glencore Xstrata has announced a 9% drop in EBITDA to US$ 6 billion – the higher end of expectations – as the company’s earnings became the latest of the big mining companies to suffer from weak commodity prices.
Writedown of Xstrata assets
The company also announced a US$ 7.6 billion writedown of assets acquired with Xstrata but did not break down the impairment. It blamed the writedown, the latest in a long line to hit the mining industry this year, on “the broader negative mining industry environment/sentiment which prevailed during H1 2013 and the heightened risks associated with greenfield and large scale expansion projects”.
Coal earnings down on weak prices
Earnings from coal were down 32% on the same period last year to US$ 1.383 billion, despite a 4% rise in production. This included a 34% drop in Australian metallurgical coal revenues and a 48% drop in revenues from the Cerrejon mine in Colombia, which was hit by industrial action earlier this year.
Edited from various sources by Jonathan Rowland