Glencore (GLEN) H1 2024 earnings summary

Executive summary

• Adjusted EBITDA for H1 2024 was $6.3bn, down 33% year-over-year, mainly due to lower coal prices and reduced industrial earnings.

• The acquisition of EVR, a leading steelmaking coal producer, was completed in July, supporting future production, copper-equivalent growth, and segment transformation.

• Board decided to retain coal and carbon steel business after shareholder consultation, supporting cash generation and transition metals investment.

• ESG progress included over 90% shareholder support for the Climate Action Transition Plan and resolution of all outstanding government investigations.

• Net income before significant items was $1.5bn, a 65% decrease; reported net income was negative $0.2bn, with a net loss attributable to equity holders of $233m after $1.7bn in significant items.

Financial highlights

• Revenue rose 9% year-over-year to $117.1bn; Adjusted EBITDA down 33% to $6.3bn; Adjusted EBIT down 55% to $2.85bn.

• Industrial Adjusted EBITDA fell 39% to $4.5bn, mainly from a $2.7bn lower coal contribution due to a 36% drop in Newcastle coal prices.

• Marketing EBIT reached $1.5bn, annualizing to $3bn, at the top end of guidance, driven by metals trading.

• Net funding reduced by $1.7bn to $29.4bn; net debt down to $3.6bn from $4.9bn at end-2023.

• Spot annualised free cash flow generation, including EVR, estimated at $6.1bn.

Outlook and guidance

• 2024 full-year production guidance (ex-EVR) maintained; H2 expected to be stronger due to EVR and higher copper, zinc, and nickel output.

• Steelmaking coal guidance for 2024 raised to 19-21Mt, including c.12Mt from EVR; thermal coal guidance unchanged at 98-106Mt.

• CapEx guidance for the base business remains at $5.7bn per annum for 2024–2026, with up to $400m earmarked for Argentinian copper projects.

• Marketing EBIT guidance maintained at $3–$3.5bn for the year, with potential upside from EVR synergies.

• Modest deleveraging required to reach $10bn net debt cap, supporting potential top-up shareholder returns in February 2025.