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Friday, July 29, 2011

Anglo American Plc half profit rose 41 percent

Anglo American Plc half profit rose 41 percent : Anglo American Plc, part-owner of the world's biggest platinum and diamond producers, said first- half profit rose 41 percent, missing estimates, as it confronts "very strong headwinds" on costs.

Underlying earnings climbed to $3.1 billion, or $2.58 a share, from $2.2 billion, or $1.84 a share, a year earlier, Anglo said today in a statement. That compares with the $2.63-a- share mean estimate of eight analysts surveyed by Bloomberg News and Anglo's consensus of $2.59.

The benefit of rising metal prices, up 65 percent in the past two years on the LMEX London Metals Index, has been eroded by energy and labor costs. In South Africa, where power prices climbed 26 percent this year, workers are on strike to demand pay increases of more than 10 percent. Anglo copper sales fell 12 percent as rain curbed output across the southern hemisphere.

Anglo's announcement of a 28 cent-a-share dividend today is "disappointing," Peter Davey, head of mining research at SBG Securities, said by phone from London. He said he expected a payment closer to 40 cents. "The performance is a bit disappointing as well, especially in copper." Bloomberg's dividend estimate was for 29 cents.

The second half should be "stronger," Chief Executive Officer Cynthia Carroll told investors in London today. Anglo has raised the price outlook for all the materials it produces, she said.
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