Ivan Glasenberg. Picture: BLOOMBERG
Ivan Glasenberg. Picture: BLOOMBERG

Glencore grew its interim revenue by 8% to $108.6bn and its after-tax profit by 15% to $2.6bn in the six months to end-June.

CEO Ivan Glasenberg attributed the strong earnings growth to the resources group’s diversified business model and commodity mix.

Wednesday morning’s interim results statement did not include an interim dividend declaration. This was expected as Glencore announced a $2.85bn distribution to shareholders in February, half of which has been paid with the other half to be paid in September. Rather than paying additional dividends, Glencore has opted for a $1bn share buyback programme.

Glencore is the last of the major miners to report its half-year earnings for 2018.

“Cash generation remains strong, with funds from operations up 8% to $5.6bn and our balance sheet healthy, with net debt of $9bn,” Glasenberg said. Net debt came in better than expected, down 16% from $10.6bn reported in mid-2017. Earnings per share grew to $0.19 from $0.17.

Industrial assets and the mining business, performed strongly. This was underpinned by higher prices and the highly competitive cost positions of the Glencore asset base. Glencore’s marketing business provided a strong performance reflecting generally supportive physical market conditions and favourable fundamentals for key commodities.

Its performance was dragged down by agricultural products which underperformed due to weak crop results in Argentina and Australia and continued industry margin pressures. Given some seasonality and the low base, Glencore said it expect a significantly improved performance from the agricultural business in the second half of the year.

Glasenberg said broader market conditions were likely to remain volatile. “We remain focused on creating value for shareholders through the disciplined allocation of long-term capital.”