With Xstrata shareholders reportedly not happy with the terms of Glencore's merger offer, the share price seems to have ignored the miner's decent full-year results also announced this morning.
Xstrata's revenue rose 11% to $33,877m in the 12 months ended December 31st 2011, up from $30,499m the year before.
Total earnings before interest, tax depreciation and amortisation (excluding exception items) rose by 12% to a record $11,648m, while operating profits increased 10% to $8.4bn, helped by increased volumes, cost savings and high commodity prices.
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Chief Executive Officer Mick Davis said that the group made $391m in cost savings in 2011, which helped offset the weakness in the US dollar against local currencies and consumer price inflation and mining sector-specific inflation.
"Our coal business accounted for the majority of the savings, primarily due to increased volumes from low cost operations, in particular from the early start-up of the low-cost Mangoola mine which resulted in $230m of unit cost savings and productivity improvements at the open cut mines in New South Wales," he explained.
The miner raised its final dividend to 27 cents per share, taking its full-year dividend to 40 cents per share, up 60% on 2010.
"While the global macroeconomic outlook for 2012 remains uncertain and demand in Western markets is likely to continue to be influenced by concerns about the European sovereign debt crisis and lower growth, China is again likely to drive consumption growth," Xstrata said.
"We expect Chinese demand to grow strongly as the government relaxes its policies aimed at cooling the economy and controlling inflation."
BC
-
What happens if you can’t pay your tax bill, and what is "Time to Pay"?Millions are due to file their tax return this Friday as the self-assessment deadline closes. Though the nightmare is not over until you pay the taxman what you owe - or face a penalty. But what happens if you can't afford to pay HMRC your tax bill, and what is "Time to Pay"?
-
What does Rachel Reeves’s plan for growth mean for UK investors?Rachel Reeves says she is going “further and faster” to kickstart the UK economy, but investors are unlikely to be persuaded
