Anglo American Faces Earnings Miss Despite Lower Copper Costs

Anglo American's upcoming earnings report is expected to show a mixed performance despite lower copper costs. According to Deutsche Bank, the miner's second-quarter production update was broadly reassuring, with copper and iron ore output around 1% ahead of expectations.

The main bright spot for Anglo American will be its copper business, which should benefit from stronger by-product credits and improved treatment charges. The company has cut its unit-cost guidance by around 15% to 145 cents per pound, while production of 173,000 tonnes met expectations.

However, weaker realised iron ore prices are expected to offset the lower costs, reflecting higher freight charges and the redirection of cargoes from Bahrain to China. Steelmaking coal and De Beers are also expected to have been EBITDA-negative during the first half.