Thursday 25 July 2019 11:29 am

Anglo American kicks off $1bn share buyback as earnings jump

The sun sets over an oil platform waiting to be towed out into the Gulf of Mexico at Port Fourchon in Louisiana, on May 4, 2010. The world will remain heavily reliant on fossil fuels for the next 40 years, Shell’s chief executive said, as a massive US oil spill cast a cloud over the industry. Despite the upsurge in alternative sources, fossil fuels, including oil, natural gas and coal, will remain the dominant source for meeting increasing world energy demand until at least 2050, said chief executive Peter Voser. “Energy demand will double between now and 2050. We have currently roughly 80 percent of fossil resources delivering the energy demand today. We still see this at around 60 percent by 2050,” said the chief executive of the Anglo-Dutch energy giant. His comments come as rival BP is under intense pressure over an oil spill from a platform in the Gulf of Mexico, which has given US authorities pause for thought over future drilling plans. AFP PHOTO/Mark RALSTON (Photo credit should read MARK RALSTON/AFP/Getty Images)

Anglo American put a smile on the face of investors this morning after posting a better-than-expected rise in earnings and launching a $1bn ($800m) buyback.

The mining giant raised its dividend payout by almost 30 per cent after underlying earnings before interest, tax, depreciation and amortisation (Ebitda) rose 19 per cent to $5.45bn in the first half of 2019.

Strong prices for iron ore and the platinum group metals boosted the firm’s performance in the six months to June, despite a fall in values for coal, copper and nickel.

The firm trumped a company-compiled consensus of analyst expectations that expected Ebitda would hit $5.16bn during the period.

Chief Executive Mark Cutifani said: “With a strong balance sheet in place, we then consider the appropriate balance of options for any discretionary capital, in terms of growth investments and additional returns.”

He added: “Today’s announcement of a share buyback programme demonstrates our applied discipline and the board’s confidence in the business.”

Shares in the British multinational mining company, which is based in Johannesburg, rose 1.5 per cent in morning trading.