Glencore shares jump 8% as miner sets 2015 debt reduction target

Glencore’s share price gained as much as 8% on Wednesday November 4 as the miner-trader said it expects to cut its net debt to $25 billion by the end of 2015.

Since announcing its debt restructuring plans in September, Glencore has raised $2.5 billion from a share issue, saved $2.4 billion from the suspension of its 2015 final distribution and 2016 interim distribution, and raised $900 million from its first precious metals streaming transaction. 

The company has also begun the process to sell its stake in the Lomas Bayas and Cobar copper operations, it said today.

The Barr, Switzerland-based company aims to cut its net debt to about $25 billion by the end of 2015, a drop of 18% from $30.5 billion at the end of 2014. 

It is targeting a further reduction in net debt to the low $20 billions by the end of 2016.

In its third-quarter production report, Glencore also confirmed that its full-year marketing adjusted earnings, before interest and tax guidance, are between $2.5 billion and $2.6 billion, supported by a stronger contribution from its metals, minerals and agricultural divisions.

The miner’s available committed liquidity increased to $13.8 billion in the third quarter, compared with $10.5 billion at the end of June.

The increase was the result of raising $1.7 billion in net capital, cash generation from is operations, and the release of readily marketable inventories in the third quarter.

At the time of writing, shares in Glencore were trading at 127.3p, up 6.57% from Tuesday’s closing price.

Charlotte Radford 
charlotte.radford@metalbulletin.com
Twitter: @CRadford_MB