Anglo American PLC has unveiled a comprehensive plan to expedite the delivery of its strategy, aiming to unlock significant value from its portfolio and enhance shareholder returns. The company plans to simplify its portfolio by focusing on world-class assets in copper, premium iron ore, and crop nutrients. This includes retaining 100% future-enabling portfolio, with 54% copper production, in products that support the energy transition, improving global living standards, and food security.
The strategic changes involve divesting from certain assets, such as Steelmaking Coal, exploring options for Nickel, demerging Anglo American Platinum, and divesting or demerging De Beers. The company aims to deliver sustainable incremental value creation through a step change in operational performance and cost reduction. This will result in a high-quality financial profile, with an EBITDA margin increase to 46% from 31% on a 2023 pro forma basis, and $1.7 billion lower cost of new portfolio configuration.
Duncan Wanblad, Chief Executive of Anglo American, emphasized that these actions represent the most radical changes to the company in decades. He highlighted that these decisions are aimed at positioning Anglo American to capitalize on the outstanding resource endowment opportunities within its portfolio, particularly in South America and Southern Africa. The company is also mindful of the impacts of these changes on its employees and aims to implement the portfolio changes in a respectful manner, ensuring support for host communities and countries.
This strategic shift is expected to accelerate the recognition of value inherent in Anglo American's business for many years and provide undiluted and differentiated participation for its shareholders in major structural demand trends. The company's focus on operational excellence, portfolio simplification, and growth is set to bring the value of its copper and iron ore assets to the forefront, marking a major new phase in executing its strategy.