Glencore declares $7.1 billion payout to shareholders after record 2022 By Reuters

LONDON (Reuters) -Glencore announced a payout of $7.1 billion to its investors on Wednesday, including a $1.5 billion share buyback, as strong oil and coal prices helped it post a record 2022 profit.

In preliminary 2022 results, the miner and trader said it cut net debt to $75 million at the end of the year from $6 billion at the end of 2021.

Its adjusted earnings before interest, tax, depreciation and amortisation (EBITDA) rose 60% to a record $34.1 billion, smashing a previous best of $21.3 billion a year earlier, in line with analysts’ estimates.

“The global pandemic, recovery from it and years of underinvestment, followed by conflict in Europe, exposed pre-existing vulnerabilities in energy security and supply chains, underpinning the generally high and volatile 2022 commodity price environment, which enabled the Group to generate record profitability for the year,” CEO Gary Nagle said.

Profit on metals and fossil fuels trading hit a record $6.4 billion in 2022, up 73%, though analysts see a repeat of that performance this year or next as unlikely.

Prices of thermal coal, the most polluting fossil fuel, for example, are around currently half the all-time high they reached last year, as mild weather has softened demand.

“COVID, supply chain disruptions and the power crisis in Asia/Europe has created exceptional opportunities for Marketing,” UBS analysts said in a note.

“We see potential for Marketing EBIT to remain above long-term normal levels over the next 2 years but the extreme dislocations seen in 2020-22 seem unlikely.”