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Glencore, the world's largest globally diversified natural resource company, posted that its shares plummeted on February 21, according to Reuters.
The company have reported an earnings slump for 2023 amid lower commodity prices and cut the dividend paid to investors to acquire a 77% stake in Teck Resources' metallurgical coal business.
Glencore's adjusted earnings before interest, taxes, depreciation and amortization (EBITDA) dropped sharply to $17.1 billion from $34.1 billion last year, matching analysts' consensus estimates.
Shares of London-listed Glencore declined 2.2% at 12:34 GMT in the wake of falling over 6% earlier.
The $1.6 billion payout released by the Swiss-based commodities giant on February 21 does not include a new buyback scheme that ends this month, nor does it include a special dividend.
Glencore's dividend paid to shareholders this year came in at 13 cents per share, much lower from 34 cents last year. The dividend cut was used to pay for its $6.9 billion acquisition of Canadian miner Teck's unit.
The acquisition deal will complete by the third quarter of this year, which is likely to add 20 million tonnes of steelmaking coal capacity per annum to Glencore's portfolio. The company plans to spin off its thermal and metallurgical coal business after the deal.
Glencore chief executive Gary Nagle noted that the business will generate considerable, helping restart top-up returns in the future, despite no returns at the moment. Glencore will continue seeking shareholders' inputs on the spinoff once the acquisition is completed.
Jefferies analysts expected Glencore shares to outperform again as the deal would generate large capital returns.
In addition, Glencore plans to lift copper production to boost earnings. The company will start deploying capital to its two brownfield projects in Argentina, CFO Steven Kalmin said.
Glencore will sell its stake in Koniambo Nickel SAS in New Caledonia to stop ongoing losses caused by over 40% price drops in nickel last year, and suspend production at its operating plant for six months while searching for a new investor.
(Writing by yan.sun Editing by Alex Guo)
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