by Investec Switzerland. Glencore Plc shareholders showing up for the miner’s annual meeting on Thursday can take comfort in the stock’s best ever start to a year. Less so the loss of about half the company’s value since they met 12 months ago and more than 70 percent since a billion initial public offering in 2011. Such wild share swings highlight both the opportunities from billionaire Chief Executive Officer Ivan Glasenberg’s plans to cut net debt by as much as billion, and the risks from weak demand for the commodities it produces. Zug viewed from the lake – © Denis Linine | Dreamstime.com “A general gradual recovery in commodity prices would be a positive for Glencore. But you need a strong recovery to get back to the 2011 levels and that’s unlikely for now.” Investors will gather in the Theater-Casino of the sleepy Swiss lakeside city of Zug five years to the day since Glencore’s IPO in London. Those who stuck with the company have faced near unrelenting losses as commodity prices slumped. The offering, which made billionaires of Glasenberg and some company trading chiefs, took place in a commodity bull market. Since then copper and oil prices have sunk by half, and in September Glencore tumbled 38 percent, its worst month ever.
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Glencore Plc shareholders showing up for the miner’s annual meeting on Thursday can take comfort in the stock’s best ever start to a year. Less so the loss of about half the company’s value since they met 12 months ago and more than 70 percent since a $10 billion initial public offering in 2011. Such wild share swings highlight both the opportunities from billionaire Chief Executive Officer Ivan Glasenberg’s plans to cut net debt by as much as $9 billion, and the risks from weak demand for the commodities it produces.
Zug viewed from the lake – © Denis Linine | Dreamstime.com
“A general gradual recovery in commodity prices would be a positive for Glencore. But you need a strong recovery to get back to the 2011 levels and that’s unlikely for now.” Investors will gather in the Theater-Casino of the sleepy Swiss lakeside city of Zug five years to the day since Glencore’s IPO in London. Those who stuck with the company have faced near unrelenting losses as commodity prices slumped. The offering, which made billionaires of Glasenberg and some company trading chiefs, took place in a commodity bull market. Since then copper and oil prices have sunk by half, and in September Glencore tumbled 38 percent, its worst month ever. While raw materials have rebounded from lows this year, the outlook for metals prices remains bearish, Goldman Sachs Group Inc. said in a report on May 17.
By Agnieszka de Sousa (Bloomberg)