Glencore scraps $2,6bn dividend after first-half loss
Glencore became the first major mining company to scrap its dividend, saying on Thursday the economic outlook was too uncertain because of the coronavirus pandemic and that it would prioritise cutting debt instead.
The mining and commodities trading company said its net debt jumped 12 percent in the first six months of the year to $19,7 billion and that it was booking a $3,2 billion charge, mainly due to the broader economic fallout on its businesses from the pandemic.
While its trading division’s record $2 billion first-half operating profit helped boost overall adjusted earnings, the hefty charges meant Glencore ended up posting a net loss of $2.6 billion — the same amount it had been due to pay in dividends.
The record trading performance, mainly thanks to oil markets, came at the expense of higher net debt as Glencore used more working capital as a one-off in the exceptional Covid-19 circumstances to buy and store large amounts of cheap crude. — Reuters