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Anglo American doubles FY'17 profit to US$3.17 billion

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Anglo American doubles FY'17 profit to US$3.17 billion

TOP NEWS

Anglo American doubles FY'17 profit to US$3.17B

Anglo American Plc's full-year 2017 profit attributable to shareholders increased 99% to US$3.17 billion, or US$2.48 per basic share, from US$1.59 billion, or US$1.24 per share, in 2016, as revenue improved to US$26.24 billion from US$21.38 billion. The company's board proposed a final dividend of 54 U.S. cents per share, bringing total dividends paid for 2017 to US$1.02 per share, compared to no dividends paid to shareholders in 2016.

Burkina Faso eyes new developer for world's biggest manganese deposit

The government of Burkina Faso is seeking a new partner for the development of the Tambao manganese mine, which is valued at US$1 billion, after its partnership with Pan African Minerals Ltd. fell through, Bloomberg News reported. Mining Minister Oumarou Idani attributed the failed partnership to a "breakdown of confidence," while a Pan African executive refused to comment on the matter due to an ongoing court case. The company is seeking up to US$4 billion in damages from Burkina Faso after it was ordered to stop Tambao's production in 2015.

Newmont Q4'17 loss deepens, FY loss narrows

Newmont Mining Corp.'s net loss rose to US$527 million in the fourth quarter of 2017 from US$344 million a year ago, while its loss for the full year narrowed to US$98 million from US$627 million in 2016. The company attributed the improved annual results to higher gold output and prices, among other factors.

DIVERSIFIED

* BHP Billiton Group CEO Andrew Mackenzie said the company will not move its Singapore marketing hub even if Australia cuts its corporate taxes, noting the Singapore office's strategic location, Reuters reported. The office has been questioned by Australia's tax office, claiming the mining giant is minimizing tax payments by using the Singapore hub to sell mostly Australian products.

* Chad agreed to restructure more than US$1 billion in debt with Glencore Plc, extending the loan's maturity to 12 years with the country receiving a two-year grace period, Bloomberg News reported. Under the revised agreement, the interest rate is also reduced to the benchmark London Interbank Offered Rate plus 2%, compared to LIBOR plus 7.5% previously. Glencore will guarantee the oil supply for the country's local refining requirements over the contract's duration, according to the report.

* Meanwhile, Glencore said it has not been paying royalties to Israeli billionaire Dan Gertler since he was sanctioned by the U.S. government, the Financial Times reported. According to the report, Glencore owes about US$200 million in royalties from its mines in the Democratic Republic of the Congo to Gertler-affiliated companies over the next two years. The company added that it has yet to figure out a way to fulfill its obligation.

BASE METALS

* Nyrstar NV swung to a €47 million net profit in 2017, thanks to a €126 million impairment reversal, compared to a €414 million loss in 2016, which included a €266 million impairment loss. Underlying EBITDA rose 5% year on year to €205 million, underpinned by higher zinc prices and increased production, among others.

* Cobalt has been the standout commodity over the past 12 months, and analysts at the RIU Explorers Conference in Fremantle, Western Australia, believe that it will continue to attract risk capital with more floats expected on the ASX in 2018. Despite the major need for cobalt, Patersons Securities' senior resources analyst Simon Tonkin warned Australian investors that while some of Australia's cobalt players have significant value in their share prices, "investors should be cautious because cobalt can sometimes be difficult to recover."

* Southern Copper Corp., which won an auction to develop the Michiquillay copper mine in Peru, estimates a capital investment of about US$2.5 billion for the project. Michiquillay is expected to produce 225,000 tons of copper per year for an initial mine life of more than 25 years, and production is expected to begin in 2025.

* KAZ Minerals PLC's net profit for 2017 jumped to US$447 million from US$177 million in 2016. Revenue more than doubled over 2016 to US$1.66 billion, while operating profit rose to US$715 million from US$218 million. The copper miner expects to produce between 270,000 and 300,000 tonnes in 2018 as a result of higher throughput, offset by slightly lower average copper grades.

* OZ Minerals Ltd.'s net profit for full year 2017 jumped 114% year over year to A$231.1 million driven by a strong operational performance that allowed the company to take advantage of improved copper prices. OZ Minerals' revenue climbed 24% to A$1.02 billion.

* Hudbay Minerals Inc. posted a net profit of US$99.7 million and US$163.9 million for the fourth quarter and full-year 2017, respectively, swinging from year-ago net losses of US$47.3 million and US$35.2 million.

PRECIOUS METALS

* Sibanye Gold Ltd. canceled a dividend payment for 2017 after the company swung to a net loss of 4.44 billion South African rand from earnings of 3.47 billion rand in 2016. The company booked 4.41 billion rand in impairment losses in 2017, compared to 1.38 billion rand in 2016.

* IAMGOLD Corp.'s net loss attributable to shareholders in the fourth quarter of 2017 widened to US$17.7 million, from a net loss of US$5.3 million in the year-ago quarter, mainly due to a US$30.3 million tax charge in the quarter. For the full year, net earnings attributable to shareholders surged to US$501.6 million, from net earnings in 2016 of US$52.6 million, mainly due to US$524.1 million of impairment reversals at the Cote gold project in Ontario and the Rosebel mine in Suriname.

* Alamos Gold Inc. narrowed its net loss in the fourth quarter of 2017 to US$4.7 million from US$20.6 million a year ago, helping the company swing to a full-year profit of US$26.6 million from a US$17.9 million loss in 2016.

* Macquarie Group Ltd. denied allegations that some of its brokers and advisers inflated the stock price of Cleveland Mining Co. Ltd. through false or misleading statements to sell cheaply purchased stocks at a higher price, Bloomberg News reported, citing Greg Ward, Macquarie's head of banking. Macquarie said it had been threatened with a class-action lawsuit over the matter but no case has been filed yet.

* OceanaGold Corp. posted record net profit of US$88.6 million and US$171.7 million in the fourth quarter and full-year 2017, respectively, as a result of record full-year output. The company's revenue reached record highs of US$246.1 million in the fourth quarter and US$724.4 million for full year 2017.

* New Dimension Resources Ltd. struck a deal to acquire the advanced-stage Las Calandrias, Los Cisnes and Sierra Blanca gold-silver projects in Argentina's Santa Cruz province from Sandstorm Gold Ltd.

* Hochschild Mining Plc is looking to diversify into other metals, including copper, zinc and minerals linked to electronics and batteries, but assured that gold and silver will remain its top priority for the foreseeable future, Reuters reported, citing CEO Ignacio Bustamante.

* Bulletin Resources Ltd., through its unit Gekogold Pty. Ltd., signed a heads of agreement with Coolgardie Minerals Ltd. to gain a royalty from gold production and a 30% profit share from the sale of minerals from the Geko gold project in Western Australia after Coolgardie earns the first A$9 million in profit, at no cost to Bulletin, to settle a legal dispute between the two companies and immediately start mining activities at Geko.

* Primary Gold Ltd. shares jumped over 28% on the ASX on Feb. 21 after the company agreed to a conditional takeover offer from China Hanking Holdings Ltd., which already has about an 8.4% stake in the company.

* Carbine Resources Ltd. decided to minimize expenditure at its Mount Morgan gold-copper project in Queensland, Australia, after an economic review estimated all-in sustaining costs to increase to A$862/oz, from A$549/oz estimated in the December 2016 feasibility study.

* Genesis Minerals Ltd. posted a 55% jump in contained gold at its Ulysses deposit in Western Australia, with the average grade increasing 31% compared to the previous estimate completed May 2017. Ulysses now hosts measured, indicated and inferred resources totaling 3.3 million tonnes at an average 3.0 g/t of gold for 320,700 ounces.

BULK COMMODITIES

* Hundreds of members of South Africa's National Union of Mineworkers started a strike Feb. 21 at the Optimum coal mine, owned by the Gupta family, amid concerns over the operation's viability, Reuters reported. A union spokesman said workers are worried over wages after several banks cut all ties with the Guptas due to reputational risk. An earlier report indicated the operation could be closed over failing to operate a water desalination plant in the community, violating license terms.

* The Finnish Financial Supervisory Authority ordered Afarak Group Plc COO Danko Koncar to launch a takeover bid for the company at a minimum of €40 million and imposed a conditional fine to ensure Koncar's compliance. Koncar must launch a mandatory bid within a month of the order or pay a €40 million conditional fine plus €10 million for each full month of delay.

* A spokeswoman for Adani Enterprises Ltd.'s Australian unit said the company will consider selling a minority stake in its Carmichael coal project in Queensland after suffering several setbacks in securing financing. According to Bloomberg News, the spokeswoman did not disclose further details.

* Glencore Plc CEO Ivan Glasenberg disputed concerns that a proposed deal to acquire a 49% stake in Yancoal Australia Ltd.'s Hunter Valley Operations will lead to an excessive consolidation of coal supply as a regulatory approval from the Japan Fair Trade Commission remains the last hurdle to close the deal, The Australian Financial Review reported.

* Alumina Ltd. hiked its final dividend for 2017 by 200% year over year to 9.3 U.S. cents apiece after swinging to a net profit of US$339.8 million for full year 2017 from a year-ago net loss of US$30.2 million. This brings the company's total 2017 dividend to 13.5 cents, up 125% year over year.

* Kaiser Aluminum Corp. swung to a fourth-quarter 2017 net loss of US$15 million, or 90 U.S. cents per share, from a net income of US$25 million, or US$1.37 per share, in the same period of 2016, due to an incremental US$37 million noncash tax expense related to the revised U.S. tax legislation. For full year 2017, the company recorded a net income of US$45 million, or US$2.63 per share, down from US$92 million, or US$5.09 per share, in 2016.

* Fortescue Metals Group Ltd. launched an offer to purchase for cash up to US$1.40 billion aggregate principal amount of its 9.750% senior secured notes due 2022.

* Chinese steelmakers are forecast to gradually ramp up output at its mills in the coming months as the country's supply curbs in the winter months are set to expire, Bloomberg News reported, citing BHP Billiton Group Chief Commercial Officer Arnoud Balhuizen.

* Wesfarmers Ltd. said it is continuing the strategic review of its remaining coal asset, a 40% interest in the Bengalla mine in New South Wales, Australia, and plans to complete the sale of its Curragh coal mine in Queensland in the second half, Mining Weekly reported.

SPECIALTY

* The Portuguese government is demanding a meeting with Spain to discuss the latter's plan to open a uranium mine near the Portuguese border, Xinhua News Agency reported, citing Joao Matos Fernandes, Portugal's environment minister. Fernandes said Portugal has made several information requests that have been ignored or insufficiently addressed.

* Triton Minerals Ltd. will acquire full ownership of Grafex Ltda. and its graphite assets in Mozambique after entering into an agreement to acquire Gregory James Sheffield's 20% interest in the company for US$1.5 million.

INDUSTRY NEWS

* Mining floats on the ASX are set to surge to levels not seen in 20 years, with the window wide open for capital raisings and miners jumping at the chance with about A$360 million in raisings already underway, analysts said. Patersons Securities' senior resources analyst Simon Tonkin predicted between 30 to 60 new floats in 2018 after IPOs soared from seven in 2016 to 25 in 2017. "Investors are looking for the next big commodity. Cobalt has been the latest one, but there are others like vanadium, as risk capital has returned to the small-cap space," Tonkin said at the RIU Explorers Conference in Fremantle, Western Australia.

* Minas Gerais, the southeastern Brazilian state hosting most mining operations in the country, continues to battle a severe yellow fever outbreak that led authorities to declare a state of emergency in January. Mining operations in the area have so far not been affected, companies including Vale SA, Kinross Gold Corp., AMG Advanced Metallurgical Group NV, Nexa Resources SA and Alcoa Corp. told S&P Global Market Intelligence. However, many introduced protective measures.

* Citigroup, a major lender to mining companies and commodity traders, created a new position to manage its corporate banking activities in natural resources across Europe, the Middle East and Africa, the Financial Times reported. The lender tapped Marie-Christine Olive for the role.

The Daily Dose is updated as of 7 a.m. ET and scans news sources published in Chinese, English, Indonesian, Malay, Portuguese, Russian, Spanish, Thai and Ukrainian. Some external links may require a subscription.