Glencore Lifts Dividend 8%
LONDON -- GlencoreInternational (ISE: GLEN.L) held steady at 354 pence in early London dealing after the commodities trader published its half-year results.
The FTSE 100 (UKX) member reported six-month revenues up 17% at 108 billion pounds and adjusted operating profits down 24% at 2.508 billion pounds.
Glencore described the performance as "respectable" in light of the "challenging backdrop" of lower commodity prices and the "softening growth outlooks" of many economies.
Within Glencore's trading division, progress was limited by lower volatility across oil and coal markets, weak oil freight prices, and generally fewer arbitrage opportunities. Meanwhile, production profits were hurt by the prices of nickel, zinc, and copper falling 28%, 15%, and 14%, respectively.
Reported earnings slumped 42% to $0.33 per share, while net debt increased 12% to $14 billion.
The dividend was lifted 8% to $0.054 per share, which Glencore said reflected its confidence in the diversification of the firm's operations, the prospects of future production and its balance-sheet strength.
Glencore Chief Executive Ivan Glasenberg said:
Glencore has continued to deliver strong financial results supported by a solid performance in marketing. The improvement on the second half of 2011 is particularly pleasing. This demonstrates the strength of Glencore's capital-efficient volume growth and diversified business model, underpinned by the strong relationships we have with our customers, suppliers, and finance providers.
Looking forward, we neither anticipate nor assume any material improvement in overall market or economic conditions in the near term. We will continue to diligently look to our own growth pipeline and end markets to maximize performance for our shareholders.
At present, Glencore's 12-month earnings are running at around $0.48, or 30 pence, per share. The company's P/E could therefore be less than 12.
However, that rating is not as low as others in the commodity sector. Indeed, plenty of big-name mining shares exhibit single-digit P/Es right now and some of the more promising operators in the sector are covered in a special Motley Fool report.
"The market's top sectors" highlights the mining industry and two other sectors with favorable prospects for 2012 and beyond. The report contains various share ideas and company analysis and can be delivered to your inbox within minutes.
Are you looking to profit from this uncertain economy? "Ten Steps To Making A Million In The Market" is the very latest Motley Fool guide to help Britain invest. Better. We urge you to read the report today -- it's free.
Further Motley Fool investment opportunities:
The article Glencore Lifts Dividend 8% originally appeared on Fool.com.Maynard does not own any share mentioned in this article. The Motley Fool has a disclosure policy. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. Try any of our Foolish newsletter services free for 30 days.
Copyright © 1995 - 2012 The Motley Fool, LLC. All rights reserved. The Motley Fool has a disclosure policy.