news release - glencore · 2019-11-27 · news release baar, 9 may 2012 ims & first quarter...

NEWS RELEASE

Baar, 9 May 2012

IMS & First Quarter 2012 Production ReportKEY HIGHLIGHTS

• Glencore’smarketingoperationshavecontinuedtotraderobustly• Majorgrowthprojectsremainoverallonscheduleandwithinbudget• Kazzincgoldproductionup24%yearonyearwithrecoveryratescontinuingtoimprove• Katangacoppermetalup2%yearonyear,withcathodeproductionup24%yearonyearandagreementreachedwiththeDRC’sSociétéNationaled’Electricité(SNEL)toprovideprogressiveincreaseinpoweravailability

• Mutandacopperproductionup46%yearonyear,producingatanannualisedrateof78,000 tonnesatendofMarchandPhase IIfrontendmechanicallycompletedinJanuary2012

• Prodecoownproductionup10%yearonyearaspartofthecurrentprojecttodeliverannualisedproductionof21milliontonnesbyQ42013

• IncreasingownershipofOptimumCoalaspartofawiderconsortium.OptimumaddssignificantresourceandminelifetoGlencore’scoaloperationsinSouthAfrica

• Asengoilproductionaheadofscheduleat60,000 bbls/dayandAlenfieldonscheduleandbudgetforfirstproductioninlate2013• MergerofequalswithXstratalaunched7 February2012withcompletionexpectedQ3 2012• AcquisitionofViterralaunched20 March2012withcompletionexpectedQ3 2012• Successfulrenewalandincreaseof$ 12.8 billionrevolvingcreditfacilitiesvalidatestheconservativefundingstructurewhichsup-

portsGlencore’smarketingoperations• Suchrefinance,togetherwithEuroandSterlingbondissuancesinApril,hasboostedanalreadyrobustcommittedliquidityposi-tionbymorethan$ 3 billion

Glencorehastradedwellacrossallsegmentsofitsbusinessin2012.Physicaldemandforcommoditiesremainsbroadlyhealthyacrosstheglobe,althoughpreciseconditionsvarybylocation.USdemandhascontinuedtostrengtheninareassuchasauto-mobilesandaerospace,whileEuropeanconditionsremaingenerallyweaker.OverallChinesedemandcontinuestobehealthy.Itremainsourviewthatavailableglobalinventoriesaregenerallylow,bothonexchangesandwithinsupplychains.

Wecontinuetobeencouragedbyourprogress indevelopingthegrowthprojectswithinour industrialassetbase.Glencore’sgrowthisbrownfieldwithattendantshortleadtimesandlowlevelsofcapitalintensity.Thefewshort-termchallengesarebeingaddressedandoveralltheprojectsremainontrackbothintermsoftimeandbudget.

The proposedmergerwith Xstratawill, if successful, provide immediate synergy benefits including removing the constraintswhichthecurrentownershipstructureimposes.Togetherwehavequantifiedthemeasurablepre-taxsynergiesasbeingatleast$ 500 millionin2013.Inaddition,bothpartiesseematerialscopeforportfoliooptimisationtodrivemoreefficientcapitalallocationacrossthecombinedentity.

TheViterratransactionisGlencore’sfirstmajorinvestmentintheNorthAmericanagriculturalsectorandreflectsthecompany’sstrongbeliefintheimportanceandfuturepotentialoftheCanadianandAustraliangrainmarkets.

Glencorewillannouncehalf-yearresultson21 August2012.

Forfurtherinformationpleasecontact:

Investors & analysts Media Finsbury (Media)PaulSmith SimonBuerk GuyLammingt:+41(0)41 7092487 t:+41(0)41 7092679 DorothyBurwelle:[email protected] e:[email protected] t:+44(0)20 7251 3801

ElisaMorniroli CharlesWatenphult:+41(0)41 7092818 t:+41(0)41 7092462e:[email protected] e:[email protected] website:www.glencore.com

| First Quarter 2012 | 2

Metals and MineralsProduction data

thousand¹

Usingfeedfromownsources

Usingfeedfromthirdparty

sourcesQ1 2012

Total



sourcesQ1 2011

TotalOwnfeed

change

KazzincZincmetal MT 61.8 12.9 74.7 58.4 15.9 74.3 6%Leadmetal² MT 9.5 12.5 22.0 9.0 17.8 26.8 6%Coppermetal ³ MT 13.6 0.6 14.2 11.4 0.5 11.9 19%Gold toz 107 18 125 86 8 94 24%Silver toz 928 3 702 4 630 1 250 702 1 952 – 26%KatangaCoppermetal³ MT 18.7 – 18.7 18.4 – 18.4 2%Cobalt MT 0.59 – 0.59 0.64 – 0.64 – 8%MutandaCoppermetal³ MT 16.6 – 16.6 11.4 – 11.4 46%Cobalt4 MT 1.72 – 1.72 1.55 – 1.55 11%MopaniCoppermetal³ MT 22.7 25.8 48.5 24.5 25.3 49.8 – 7%Cobalt4 MT 0.04 0.08 0.12 0.23 0.05 0.28 – 83%Other Zinc (Los Quenuales, Sinchi Wayra, AR Zinc, Portovesme)Zincmetal MT 11.9 21.3 33.2 14.8 23.2 38.0 – 20%Zincoxide DMT 9.8 – 9.8 9.1 – 9.1 8%Zincconcentrates DMT 97.7 – 97.7 118.8 – 118.8 – 18%Leadmetal MT 2.5 – 2.5 2.5 – 2.5 0%Leadconcentrates DMT 14.6 – 14.6 15.9 – 15.9 – 8%Tinconcentrates DMT 1.38 – 1.38 0.88 – 0.88 57%Silvermetal toz 164 – 164 148 – 148 11%Silverinconcentrates toz 1 693 – 1 693 2 175 – 2 175 – 22%Other Copper (Cobar, Pasar, Punitaqui, Sable)Coppermetal MT – 15.9 15.9 – 42.0 42.0 n.m.Copperconcentrates DMT 47.8 0.1 47.9 36.5 – 36.5 31%Cobalt MT – 0.17 0.17 – – – n.m.Silverinconcentrates toz 314 – 314 131 – 131 140%Alumina/Aluminium (Sherwin)Alumina MT – 304 304 – 367 367 n.m.Nickel/Cobalt (Murrin Murrin)Nickelmetal MT 6.26 0.20 6.46 7.19 0.28 7.47 – 13%Cobalt MT 0.46 0.01 0.47 0.47 0.02 0.49 – 2%

Total Zinc contained MT 129.9 34.2 164.1 140.3 39.1 179.4 – 7%Total Copper contained MT 84.5 42.4 126.9 76.1 67.8 143.9 11%Total Lead contained MT 20.6 12.5 33.1 20.1 17.8 37.9 2%Total Tin contained MT 0.65 – 0.65 0.41 – 0.41 59%Gold (incl. Gold equivalents) 5 toz 168 89 257 172 24 196 – 2%Total Alumina MT – 304 304 – 367 367 n.m.Total Nickel MT 6.26 0.20 6.46 7.19 0.28 7.47 – 13%Total Cobalt MT 2.81 0.26 3.07 2.89 0.07 2.96 – 3%

1Productionis includedona100%basis.ControlledindustrialassetsonlywiththeexceptionofMutanda(40%owned)whereGlencorehasoperationalcontrol.

2Leadmetalincludesleadcontainedinleadconcentrates.3Coppermetalincludescoppercontainedincopperconcentratesandblistercopper.4Cobaltcontainedinconcentratesandhydroxide.5Mostimportantly,Kazzincgoldproductionincreased24%,althoughoverallreportedgoldproductionwasdown2%duetolowersilvercontentinzincconcentrateandadecreaseinthegold/silverconversionratio.Thisratio,basedonaverageprices,decreasedfrom1/43.42inQ1 2011to1/51.77inQ1 2012.Takingaconstantratiototalgoldproductionincludingsilverasgoldequivalentwouldhaveincreasedbyapproximately5%.


Selected average commodity prices

Q1 2012 Q1 2011 Change

S&PGSCIIndustrialMetalsIndex 406 477 – 15%

LME(cash)zincprice($/t) 2 028 2 394 – 15%

LME(cash)copperprice($/t) 8 327 9 633 – 14%

LME(cash)leadprice($/t) 2 092 2 602 – 20%

Goldprice($/oz) 1 691 1 388 22%

MetalBulletinaluminaprice($/t) 317 391 – 19%

LME(cash)aluminiumprice($/t) 2 181 2 506 – 13%

LME(cash)nickelprice($/t) 19 639 26 907 – 27%

MetalBulletincobaltprice99.3%($/lb) 14.6 18.4 – 21%

Ironore(Platts62%CFRNorthChina)price($/DMT) 143 180 – 20%

MARKETING

FlatpricesandphysicalpremiaforourcoremetalsweregenerallyhealthyduringQ1 2012although, insomemetals,thelatter

movedinoppositedirectionsinOECDversusChinesemarkets,reflectingdifferingshort-terminventoryconditions.

OPERATIONAL HIGHLIGHTS

Kazzinc (Glencore interest: 50.7%)

• Zincandleadproductionfromownsourcesincreasedby6%overthecomparableperiodin2011.

• Copperproductionfromownsourcesincreasedby19%overQ1 2011,followingthesuccessfulcompletionoftheNewMetallurgy

projectincludingthecoppersmelter/refineryinH2 2011.

• Totalsilverproductionincreasedsubstantiallyoverthecomparableprioryearperiod,mainlyrelatingtotheprocessingofsilver-

richthirdpartyore.Own-sourcedsilverproductiondecreased26%duringthesameperiod.

• GoldproductionfromownsourcesforQ1 2012increased24%overQ1 2011,reflectingtheimprovementsinrecoveryratesfol-

lowingthepreviouslyreportedoperatingissuesatthegrindingstageoftherefiningprocess.Recoveryrateshaveimproved

quarteronquarterandcontinuedincreasesinproductionlevelsareexpectedduringtheremainderof2012.

• Asreportedpreviously,GlencoreagreedtoincreaseitsstakeinKazzincfrom50.7%to93.0%foratotaltransactionconsideration

of$ 3.2 billion(consistingoftheissuanceof$ 1 billionofGlencoresharesatitsIPOpriceand$ 2.2 billionincash).Glencoreand

thesellerarestilltargetinganagreedQ3 2012completiondateforthistransaction.

Katanga (Glencore interest: 75.2%)

• DuringQ1 2012Katangaproduced18,749 tonnesoftotalcontainedcopper,anincreaseof2%overthecomparableperiodin

2011whiletotalcoppermetalproducedincreased24%.Copperproductionwasimpactedbylowerthanexpectedfeedofcon-

centrateduetothemillingandpowerissuesnotedbelow.

• Totaloremined(KTOundergroundandKOVopenpitmines)duringQ1 2012was1.2 milliontonnes,anincreaseof17%overthe

comparableperiodin2011,whichatagradeof3.56%resultedincontainedcopperinoreminedof43,797 tonnes.

• DewateringoftheKomotoEastPitisnearingcompletion,allowingformoreefficientandcosteffectivewastemanagementand

thepotentialdevelopmentoftheresourceusingundergroundminingmethods.

• TotaloremilledatKamotoduringQ1 2012was1.0 milliontonnes,anincreaseof13%overQ1 2011.Thevolumeoforemilledwas

impactedbyatrunnionfailureontheCM3mill,whichresultedinthemillnotbeingavailableforthemajorityofthequarter.

Areplacementisonsiteandisexpectedtobeoperatingbymid-May.

• Productionwasalso impactedbygeneralpowerdisruptions in theDRC. Improvements in infrastructure (seebelow)areex-

pectedtoimprovethereliabilityandstabilityofelectricitysuppliesgoingforward.


• AgreementshavebeenconcludedwithSNEL, theDRC’snationalelectricityutilityandengineeringcontractors, to refurbish

powergenerating,transmissionanddistributionsystems(PowerProject)thatwouldprovideforaprogressiveincreaseinpower

availabilityforMutanda,KatangaandKansukito450 megawatts,bytheendof2015.Fundingof$ 283.5 millionforthePower

Projectwillcommencefromthesecondquarterof2012andcontinueuntiltheendof2015.KatangawillfundthePowerProject

butwillbereimbursed$ 94.5 millioneachbyMutandaandKansuki,suchthatitsfundingcontributionwillalsobe$ 94.5 million.

$ 261.8 millionoftheamountwillbereimbursedbySNELthroughcreditstopowerbillspayablebythethreeoperations.

• Followingtheapprovalofthe$ 635 millionUpdatedPhaseIVExpansionprojectinQ3 2011,Katangaexpectsthefirstcopper

cathodeproductionthroughthenewSXplantsandconvertedcopperelectro-winningfacilityduringQ3 2012.Mechanicalcom-

pletionoftheUpdatedPhase IVExpansionisexpectedinQ3 2013.

Forfurtherinformationpleasevisitwww.katangamining.com

Mutanda (Glencore interest: 40.0%)

MutandaisaccountedforasanassociateunderGlencore’soperationalcontrol.

• Forthefirstthreemonths,totalcopperproduction,includingbothcathodesandcopperinconcentrate,was16,575 tonnes,a

46%increasecomparedwiththecorrespondingperiodof2011.Thisincreasewasinlinewiththecontinuedexpansionofthe

MutandaHydrometallurgicalplantandnotably,coppercathodeproductionof15,561 tonneswasthreetimesthatofQ1 2011.

• Cobaltproductionincreased11%yearonyearto1,721 tonnesincludingbothcobaltinhydroxideandcobaltinconcentrate.

• ThePhaseIIplantfrontend(milling,leachingandCCDcircuit)wasmechanicallycompletedinJanuary2012andhasbeenin

operationsinceFebruary2012.This,alongwiththealreadycommissionedEW2andEW3tankhouseshasincreasedtheoverall

plantcapacityto60,000 tonnesperannumofcoppercathodesatdesignfeedgrades.

• Throughtheuseofhigherfeedgrades,theheapleachcircuitandthePhaseIISXandEW4plantcommissionedinDecember2011,

Mutanda,attheendofMarch,wasproducingatanannualisedrateof78,000 tonnes.

• TheoptimisationofthePhase II(mill,leach,CCD,SXandEW4tankhouse)plantandtheassociatedcobaltcircuitremainson

tracktobecompletedbytheendofQ2 2012andQ4 2012respectively.ThiswillresultinMutanda’shydrometallurgicalcomplex

beingcapableofproducing110,000 tonnesperannumofcoppercathodesand23,000 tonnesperannumofcobaltinhydroxide

atdesignfeedgrades.

• Mutandafinishedcommissioningofthe390 tonnesperdaysulphuricacidand73 tonnesperdaySO2plantinFebruaryandasof

theendofMarchwasproducingsulphuricacidatdesigncapacity.

• Glencoreholdsa50%interestinKansukiInvestmentsSprlwhichinturnholdsa75%interestinKansukiSprl,theownerofthe

Kansukiconcession,therebygivingGlencoreaneffectiveinterestof37.5%.Kansukiisa185 squarekilometrecopperandco-

baltpre-developmentprojectwhichborderstheMutandaconcession.Atotalof$ 199 millionofcapitalexpenditureformine

andplantdevelopmenthasbeencommittedofwhich$ 130 millionhasbeenspent.ExplorationoftheKansukiconcessionis

ongoing.DiscussionswithrespecttoapotentialcombinationoftheMutandaandKansukioperationscontinuewithaviewto

ultimatelyobtainamajoritystakeinthemergedentity.

Mopani (Glencore interest: 73.1%)

• Totalcontainedcopperinorehoistedandminedwas13%lowerthaninQ1 2011mainlyduetothetemporarysuspensionofthe

MufuliraWestoperationsbyZEMAcoupledwithrelativelylowloaderavailabilitythroughouttheperiod.Aftermeetingswith

variousstakeholdersandsomeequipmentmodifications,operationsrecommencedatMufuliraWeston19 April2012.Totalcon-

tainedcopperinconcentrateforQ1 2012was5%lowerthanQ1 2011duetoreducedoredeliveriesfrommining.Coppermetal

fromownsourcesthereforedecreasedinQ1 2012by7%.Lowerreceiptsandgradesofthirdpartypurchasedmaterialresulted

intotalcoppercathodeproductiondecreasinginQ1 2012by3%comparedtotheequivalentperiodin2011.

• FinishedcobaltproductionfromownsourcesforQ1 2012was83%belowthecomparable2011periodduetore-alignmentof

NkanaConcentratoroperationstoproducemorecopperconcentrateinlinewiththecobaltroasterbeingputoncareandmain-

tenance(since27 September2011)toimproveoverallemissionsperformance.

Other Zinc (Los Quenuales, Sinchi Wayra, AR Zinc, Portovesme)

• Zincmetalfromownsourceswasdown20%duetotheplannedshutdownattheARZincsmelter;zincconcentratesfromown

sourceswasdown18%principallyreflectinglowergradesatSinchiWayraandLosQuenuales.

• Silverinconcentrateswasdown22%duetothelowerproductiongradesnotedabove.

• AtPortovesme,asolventextractionplantiscurrentlyinconstructionandexpectedtostartproductioninDecember2012,which

willenableittouseallthezincoxideitproducesinthezincmetalproductionprocess.


Other Copper (Cobar, Pasar, Punitaqui, Sable)

• Coppermetalforthefirstquarterof2012wassignificantlylowerthanQ1 2011asaresultofcathodeproductionstoppage,fol-

lowingafireatPasar.Productionisexpectedtorestartbythemiddleof2012followingthecompletionofrepairstothesite.

Copperconcentrateproductionwasup31%.

• TheshaftextensionprojectatCobarisontracktobecompletedduring2013.

Alumina/Aluminium

Sherwin Alumina (Glencore interest: 100%)

• AluminaproductioninQ1 2012was304,000 tonnes,a17%reductioncomparedto367,000 tonnesachievedinthecomparable

prioryearperiod.Thereductionrelatestoaplannedcalcineroverhaulshutdownandsomeunplanneddisruptions,including

availabilityissueswithpowersupply,theconveyorbeltandthefeed-line.

Ferroalloys/Nickel/Cobalt/Iron Ore

Murrin Murrin (Glencore interest: 100%)

• Q1 2012nickelproductionwas6,458 tonnes,areductionof14%againstthecomparableperiodin2011.Theshortfallrelates

mainlytotheplannedacidplantshutdownwhichwasbroughtforwardfromMay2012.


Energy ProductsProduction data

thousandMT1 OwnBuy-inCoal

Q1 2012Total Own

Buy-inCoal

Q1 2011Total

Own production

change

Thermal coal

Prodeco 4 239 58 4 297 3 842 23 3 865 10%

Shanduka(Export) 106 – 106 93 – 93 14%

Shanduka(Domestic) 1 235 320 1 555 1 242 83 1 325 – 1%

Total 5 580 378 5 958 5 176 106 5 282 8%

thousandbblsQ1 2012

TotalQ1 2011

Total Change

Oil 1

BlockI 5 281 – n.m.

Total 5 281 – n.m.

1Ona100%basis.Glencore’sownershipinterestintheAsengfieldis23.75%.


Q1 2012 Q1 2011 Change

S&PGSCIEnergyIndex 353 326 8%

API2($/t) 101 123 – 18%

API4($/t) 105 121 – 13%

Prodecorealisedprice($/t)1 98 91 8%

Shandukarealisedexportprice($/t) 95 103 – 8%

Shandukarealiseddomesticprice($/t) 42 43 – 2%

Oilprice–Brent($/bbl) 118 106 12%

1Asof31 March2012,24 milliontonneshadbeensoldforwardatanaveragepriceof$ 92pertonne.

MARKETING

Fundamentalsintheoilmarketimprovedduringthequarter,withstrongerrefiningmarginsandamorebenigncurveshape.

Asexpected,Glencore’swetfreightheadwindcontinuestodecrease.

GlobalthermalcoalmarketsexperiencedincreasedpressureanddisruptionfromtheboominshalegasproductionintheUS.

ThishaslargelymanifesteditselfintheformofincreasedsupplyofUSexportsintotheAtlanticmarket,whichinturnhashadsome

knock-oneffectonothercoalmarkets,withpricesgenerally3–4%weakerinQ1 2012versusQ4 2011.Itshouldhoweverbenoted

thattheworldwidecoalburnrateisatrecordlevels,includingEurope.WeexpecttoseematerialreductionsinUSthermalcoal

productionifUSdomesticgaspricesremainatcurrentlowlevels.



Prodeco (Glencore interest: 100%)

• OwncoalproductioninQ1 2012was4.2 milliontonnes,anincreaseof10%comparedto3.8 milliontonnesinQ1 2011,despite

theoccurrenceofexceptionallyheavyrains.Theweatherconditionshadanimpactonsalesvolumesduetothestrongwinds

prevailingattheProdecoportwithsomecorrespondingincreaseintransportcosts.

• Expansionplansremainonscheduletodeliverannualisedproductionof21 milliontonnesbyQ4 2013andthenewdirectloading

port(PuertoNuevo)isontracktobecommissionedinQ1 2013.

Shanduka (Glencore interest: 70.0%)

• Totalsaleableowncoalproductionforthefirstquarterof2012wasinlinewiththecorresponding2011period,withaslightin-

creaseinhighermarginexportproduction.

• GlencorehasenteredintoanagreementtoreduceitsinterestinShandukaCoalto49.99%inexchangeforacashconsideration

toGlencoreofZAR 368 millionandourpartnercontributingits30%shareholdingofKangraCoalintoShandukaCoal.Kangra

CoalistheowneroftheSavmoreCollieryintheErmelocoalfieldsofSouthAfrica,withacurrentannualproductioncapacityof

3 milliontonnesofsaleablecoal.CompletionisexpectedinQ2 2012.

Optimum (Glencore interest: 59.7%)

• GlencorehasincreaseditseffectiveownershipinOptimumCoalfrom31.2%to59.7%aspartofaconsortiumwithCyrilRamaphosa,

a prominentSouthAfricanbusinessmanwhoisGlencore’slocalBlackEconomicEmpowermentpartner.OptimumCoaladds

significantcoalresourceandminelifetoGlencore’scoaloperationsinSouthAfrica.IncompliancewiththetermsoftheSouth

AfricanCompaniesActandthetakeoverregulationspromulgatedunderthatAct,theconsortiumisintheprocessofmakinga

mandatoryofferatapriceofZAR 38persharetoallremainingshareholders.TheofferwillconcludeinJune 2012andcouldresult

intheconsortiumincreasingitseffectiveshareholdingfrom67.8%toapotential73.4%(dependingonacceptances)ofwhich

Glencore’seffectiveinterestcouldincreasefrom59.7%toapotential64.7%.

Oil Exploration & Production (Glencore interest: Block I: 23.75%/Block O: 25.0%)

• CurrentproductionattheAsengfield(BlockI)inEquatorialGuineaisattheplannedplateaurateofaround60,000 barrelsper

daygross.TheAlenfield(Block O)developmentinEquatorialGuinearemainsonbudgetandscheduleforfirstproductionin

late2013atanexpectedrateof37,500 barrelsperday.


Agricultural ProductsProduction data

thousandMT Q1 2012 Q1 2011 Change

Farming 248 27 819%

Oilseedcrushing 439 350 25%

Oilseedcrushinglongtermtollagreement 114 0 n.m.

Biodiesel 157 135 16%

Ricemilling 80 46 74%

Wheatmilling 265 84 215%

Sugarcaneprocessing 0 0 n.m.

Total 1 303 642 103%


Q1 2012 Q1 2011 Change

S&PGSCIAgricultureIndex 436 531 – 18%

CBOTcornno.2price(US¢/bu) 641 670 – 4%

ICEcottonprice(US¢/lb) 93 108 – 49%

CBOTsoyabeans(US¢/bu) 1 272 1 379 – 8%

NYMEXsugar#11price(US¢/lb) 25 31 – 19%

CBOTwheatprice(US¢/bu) 643 787 – 18%

MARKETING

MarketconditionswerebroadlypositiveinGlencore’scoregrainsandoilseedsmarketsduringQ1 2012.Ourrestructuredcotton

operationsdeliveredtheexpectedlevelofmodestprofitability,despiterenewedandwellpublicisedvolatilityduringthequarter.

Themarginenvironmentforbothoilseedprocessingandbiodieselproductionremainschallenging.


Oilseed crushing

•Processedvolumesincreasedby25%inQ1 2012,versusthecomparable2011period,reflectingtheadditionalprocessingvol-

umesfromthetwonewplantsUsti(CzechRepublic)andBodaczów(Poland)whichstartedoperationsduringthequarter.

AnewplantinHungaryisexpectedtostartprocessinginQ2 2012,whilethelarge-scaleTimbuessoyabeanfacilityinArgentina

isscheduledtobecompletedbytheendofQ2 2012.

Viterra (pending completion)

•On20 March2012GlencoreandViterraannouncedthat,subjecttocertainconditions,Glencorehadagreedtoacquireallofthe

issuedandoutstandingsharesofViterraforCAD 16.25pershareincashbywayofacourt-approvedplanofarrangementunder

Canadianlaw.ThisvaluesViterra’sequityatapproximatelyCAD 6.1 billiononafullydilutedbasis.InconnectionwiththeViterra

Offer,GlencorehasagreedtosellcertainofViterra’sassetstoAgriumandRichardson.TheViterradirectorshaveunanimously

recommendedthetransactionwithViterrashareholderssettovoteonthetransactionon29 May2012.Subjecttoobtainingthe

necessaryregulatoryapprovals,thetransactionisexpectedtocloseduringQ3 2012.TheViterraOfferisaseparatetransaction

totheproposedGlencoreXstratamergerofequalsandisnotconditionalonthemergerbecomingeffective.


•Viterraisavertically-integratedglobalagriculturalbusinessheadquarteredinCanada.ItiscurrentlylistedontheTorontoStock

ExchangeanditssharesarealsolistedandtradedintheformofCHESSDepositaryInterestsontheAustralianSecuritiesEx-

change.Forthe12 monthsended31 October2011,ViterrareportedgrossassetsofapproximatelyCAD 7.0 billionandadjusted

EBITDAofCAD 702 million(adjustedEBITDAbeingearningsbeforefinancingexpenses,taxes,goodwillimpairment,amortisa-

tion,(gain)/lossondisposalofassets,integrationexpensesandnetforeignexchangegain/(loss)onacquisition).

•ViterrahassignificantoperationsacrossWesternCanadaandAustralia,withadditionalfacilitiesintheUnitedStates,NewZea-

landandChina.Viterra’sprincipalbusinessactivitiescomprisethreesectors:grainhandlingandmarketing;agriproducts;and

processing.

CorporateBALANCE SHEET/CAPITAL RESOURCES/LIQUIDITY

• Committedliquidityheadroomasat31 March2012wasinexcessof$ 6.5 billion,atsimilarlevelsto31 December2011.Thiswas

boostedinApril,followingbondissuancesandincreasedbanklinesaspartofabroaderrefinancing,discussedbelow.Thereare

nomaterialrefinancingsinthenext12months.

• InApril2012GlencoreissuedEUR 1,250 million5.25%bondsmaturingin2018andGBP 300 million5.5%bondsmaturingin2022,

totalling$ 2.15 billionequivalent.

• InApril 2012Glencore signed revolving credit facilities totalling $ 12.8 billion,which renewedGlencore’s existing revolving

creditfacilities.Thefacilitiescomprise:1) a$ 4,435 million14 monthrevolvingcreditfacilitywitha10 monthterm-outoptionand

10 monthextensionoption,thatrefinancedGlencore’sexisting$ 3,535 million364-dayrevolvingcreditfacilitymaturinginMay2012,

i.e.anincreaseof$ 900 millionand2)anamountof$ 8,030 millionoftheexisting$ 8,370 million3-yearrevolvingcreditfacilityhas

beenextendedforafurtheryeartoMay2015.Separately,Glencoresigneda$ 3.1 billionsyndicatedloanbackingtheproposed

mergerwithXstrata,afterraising$ 11 billioninsyndicationfrom31 banks,ascale-backexceeding70%.

• Glencorecontinuestoexpectreceiptofallrelevantregulatoryapprovalstoenablecompletionoftheproposedmergerwith

Xstratainthethirdquarterof2012,aspreviouslyannounced.Documentationrelatingtothemergerisnowanticipatedtobe

distributedtoeachcompany’sshareholdersbytheendofMay2012.Respectiveshareholdermeetingstoapprovethemerger

areexpectedtobeconvenedinearlyJuly2012.


AppendixMETALS AND MINERALS

Production data

thousand1



sourcesQ1 2012

Total



sourcesQ4 2011

TotalOwnfeed

change

KazzincZincmetal MT 61.8 12.9 74.7 61.4 14.6 76.0 1%Leadmetal2 MT 9.5 12.5 22.0 8.3 14.2 22.5 14%Coppermetal3 MT 13.6 0.6 14.2 9.2 0.8 10.0 48%Gold toz 107 18 125 92 10 102 16%Silver toz 928 3 702 4 630 727 2 221 2 948 28%KatangaCoppermetal3 MT 18.7 – 18.7 24.2 – 24.2 – 23%Cobalt4 MT 0.59 – 0.59 0.54 – 0.54 9%

MutandaCoppermetal3 MT 16.6 – 16.6 17.6 – 17.6 – 6%Cobalt4 MT 1.72 – 1.72 2.03 – 2.03 – 15%MopaniCoppermetal3 MT 22.7 25.8 48.5 27.8 22.9 50.7 – 18%Cobalt4 MT 0.04 0.08 0.12 0.05 0.07 0.12 – 20%Other Zinc (Los Quenuales, Sinchi Wayra, AR Zinc, Portovesme)Zincmetal MT 11.9 21.3 33.2 15.0 22.9 37.9 – 21%Zincoxide DMT 9.8 – 9.8 4.5 – 4.5 118%Zincconcentrates DMT 97.7 – 97.7 99.9 – 99.9 – 2%Leadmetal MT 2.5 – 2.5 2.9 – 2.9 – 14%Leadconcentrates DMT 14.6 – 14.6 14.7 – 14.7 – 1%Tinconcentrates DMT 1.38 – 1.38 1.39 – 1.39 – 1%Silvermetal toz 164 – 164 177 – 177 – 7%Silverinconcentrates toz 1 693 – 1 693 1 926 – 1 926 – 12%Other Copper (Cobar, Pasar, Punitaqui, Sable)Coppermetal MT – 15.9 15.9 – 42.7 42.7 n.m.Copperconcentrates DMT 47.8 0.1 47.9 57.2 – 57.2 – 16%Cobalt MT – 0.17 0.17 – 0.16 0.16 n.m.Silverinconcentrates toz 314 – 314 334 – 334 – 6%Alumina/Aluminium (Sherwin)Alumina MT – 304 304 – 355 355 n.m.Nickel/Cobalt (Murrin Murrin)Nickelmetal MT 6.26 0.20 6.46 7.38 0.42 7.80 – 15%Cobalt MT 0.46 0.01 0.47 0.57 0.02 0.59 – 19%

Total Zinc contained MT 129.9 34.2 164.1 130.4 37.4 167.8 0%Total Copper contained MT 84.5 42.4 126.9 94.2 66.4 160.6 – 10%Total Lead contained MT 20.6 12.5 33.1 19.9 14.3 34.2 4%Total Tin contained MT 0.65 – 0.65 0.70 – 0.70 – 7%Gold (incl. Gold equivalents) 5 toz 168 89 257 152 52 204 11%Total Alumina MT – 304 304 – 355 355 n.m.Total Nickel MT 6.26 0.20 6.46 7.38 0.42 7.80 – 15%Total Cobalt MT 2.81 0.26 3.07 3.19 0.25 3.44 – 12%

1Productionis includedona100%basis.ControlledindustrialassetsonlywiththeexceptionofMutanda(40%owned)whereGlencorehasoperationalcontrol.

2Leadmetalincludesleadcontainedinleadconcentrates.3Coppermetalincludescoppercontainedincopperconcentratesandblistercopper.4Cobaltcontainedinconcentratesandhydroxide.5Gold/Silverconversionratioof1/51.77and1/52.86forQ1 2012andQ4 2011respectivelybasedonaverageprices.



Q1 2012 Q4 2011 Change

S&PGSCIIndustrialMetalsIndex 406 376 8%

LME(cash)zincprice($/t) 2 028 1 906 6%

LME(cash)copperprice($/t) 8 327 7 512 11%

LME(cash)leadprice($/t) 2 092 1 993 5%

Goldprice($/oz) 1 691 1 683 0%

MetalBulletinaluminaprice($/t) 317 329 – 4%

LME(cash)aluminiumprice($/t) 2 181 2 096 4%

LME(cash)nickelprice($/t) 19 639 18 380 7%

MetalBulletincobaltprice99.3%($/lb) 14.6 14.2 3%

Ironore(Platts62%CFRNorthChina)price($/DMT) 143 142 1%

ENERGY PRODUCTS

thousandMT1 OwnBuy-inCoal

Q1 2012Total Own

Buy-inCoal

Q4 2011Total

Own production

change

Thermal coal

Prodeco 4 239 58 4 297 3 674 39 3 713 15%

Shanduka(Export) 106 – 106 175 – 175 – 39%

Shanduka(Domestic) 1 235 320 1 555 1 408 281 1 689 – 12%

Total 5 580 378 5 958 5 257 320 5 577 6%

thousandbblsQ1 2012

TotalQ4 2011

Total %Change

Oil 1

BlockI 5 281 2 785 90%

Total 5 281 2 785 90%

1Ona100%basis.Glencore’sownershipinterestintheAsengfieldis23.75%.


Q1 2012 Q4 2011 Change

S&PGSCIEnergyIndex 353 326 8%

API2($/t) 101 115 – 12%

API4($/t) 105 107 – 2%

Prodecorealisedprice($/t) 98 95 3%

Shandukarealisedexportprice($/t) 95 109 – 13%

Shandukarealiseddomesticprice($/t) 42 41 2%

Oilprice–Brent($/bbl) 118 109 9%


AGRICULTURAL PRODUCTS

Production data

thousandMT Q1 2012 Q4 2011 Change

Farming 248 226 10%

Oilseedcrushing 439 538 – 18%

Oilseedcrushinglongtermtollagreement 114 238 – 52%

Biodiesel 157 147 7%

Ricemilling 80 84 – 5%

Wheatmilling 265 725 – 63%

Sugarcaneprocessing 0 205 – 100%

Total 1 303 2 163 – 40%


Q1 2012 Q4 2011 Change

S&PGSCIAgricultureIndex 436 430 2%

CBOTcornno.2price(US¢/bu) 641 620 3%

ICEcottonprice(US¢/lb) 92.7 95.4 – 3%

CBOTsoyabeans(US¢/bu) 1 272 1 175 8%

NYMEXsugar#11price(US¢/lb) 24.6 24.7 – 1%

CBOTwheatprice(US¢/bu) 643 615 5%


Forwardlookingstatements

Thisdocumentcontainsstatementsthatare,ormaybedeemedtobe,“forwardlookingstatements”.Theseforwardlookingstatementsmaybeidentified by the use of forward looking terminology, including the terms “believes”, “estimates”, “plans”, “projects”, “anticipates”, “will”,“could”,or“should”orineachcase,theirnegativeorothervariationsthereonorcomparableterminology,orbydiscussionsofstrategy,plans,objectives,goals,futureeventsorintentions.Theseforwardlookingstatementsincludeallmattersthatarenothistoricalfactsandinclude,butarenotlimitedto,statementsregardingGlencore’sbeliefs,opinionsorcurrentexpectationsconcerning,amongotherthings,thebusiness,financialcondition,resultsofoperations,prospects,strategiesandplansofGlencore.

Bytheirnature,forwardlookingstatementsinvolveknownandunknownrisksanduncertainties,manyofwhicharebeyondGlencore’scontrol.Forwardlookingstatementsarenotguaranteesoffutureperformanceandmayandoftendodiffermateriallyfromactualresults.Importantfac-torsthatcouldcausetheseuncertaintiesinclude,butarenotlimitedto,thosediscussedunder“Principalrisksanduncertainties”insection 1.7ofGlencore’sAnnualReport2011.

Noassurancecanbegiventhatsuchfutureresultswillbeachieved;actualeventsorresultsmaydiffermateriallyasaresultofrisksanduncer-taintiesfacingGlencore.Suchrisksanduncertaintiescouldcauseactualresultstovarymateriallyfromthefutureresultsindicated,expressedorimpliedinsuchforwardlookingstatements.

Forwardlookingstatementsspeakonlyasofthedateofthisdocument.Otherthaninaccordancewithitslegalorregulatoryobligations(in-cludingundertheUKListingRulesandtheDisclosureandTransparencyRulesoftheFinancialServicesAuthorityandtheRulesGoverningtheListingofSecuritiesontheStockExchangeofHongKongLimited),GlencoreisnotunderanyobligationandGlencoreanditsaffiliatesexpresslydisclaimanyintentionorobligationtoupdateorreviseanyforwardlookingstatements,whetherasaresultofnewinformation,futureeventsorotherwise.

NostatementinthisdocumentisintendedasaprofitforecastoraprofitestimateandnostatementinthisdocumentshouldbeinterpretedtomeanthatearningsperGlencoreshareforthecurrentorfuturefinancialyearswouldnecessarilymatchorexceedthehistoricalpublishedearningsperGlencoreshare.

Thisdocumentdoesnotconstituteorformpartofanyofferorinvitationtosellorissue,oranysolicitationofanyoffertopurchaseorsubscribeforanysecurities.Themakingofthisdocumentdoesnotconstitutearecommendationregardinganysecurities.

news release - glencore · 2019-11-27 · news release baar, 9 may 2012 ims & first quarter...

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