October 23, 2018 / 7:48 AM / 21 days ago

Anglo American reports 1 percent rise in third-quarter output

RLONDON (Reuters) - Anglo American on Tuesday reported lower diamond, coking coal and iron ore volumes in the third quarter, linked to planned outages, but its overall output rose 1 percent on the year, boosted by a 17-percent increase in copper production.

FILE PHOTO: The Anglo American logo is seen in Rusternburg October 5, 2015. REUTERS/Siphiwe Sibeko/File Photo

Other major miners reporting this month - BHP and Rio Tinto - have signaled lower output in copper, a mineral expected to be in high demand from increased electrification.

Anglo American said its copper production had been helped by an overall increase in productivity as each employee has been 5 percent more productive this year than in 2017.

“We maintain relentless discipline on controllable costs. Strong operational performance at our Copper assets delivered a 17 percent increase in production,” Mark Cutifani said in a statement.

Thermal coal also rose by 13 percent, while coking coal, used in steel production, fell 3 percent.

Platinum and palladium production also increased by 4 percent and 1 percent respectively in the third quarter to Sept. 30.

Anglo adjusted full-year platinum production guidance to 2.45-2.50 million ounces from 2.40-2.45 million ounces and palladium to 1.55-1.60 million ounces, from 1.50-1.60 million ounces.

It left guidance for other metals unchanged.

Declines in output of coking coal, as well as iron ore (down 9 percent) and diamonds (five percent lower) were the result of an expected fall in the quality of ore mined and planned maintenance and upgrading work, the company said.

The results discounted the impact of ongoing outages at the Minas-Rio iron ore project in Brazil, which has been halted since leaks in March.

Pipeline inspection work was on track and the replacement of a 4 km (2.5 mile) section of the pipeline, Anglo American said, reiterating previous comment.

The work is expected to be completed in the fourth quarter and after that operations will restart, subject to clearance from the Brazilian authorities.

Analysts Bernstein in a note said the copper result was “comfortably above” estimates and Tuesday’s results did not change its “outperform” view of the stock.

However, Anglo American’s shares, which so far this year have outperformed its peers, fell around 2 percent by 0735 GMT.

Reporting by Barbara Lewis; Editing by Susan Fenton and Andrew Heavens

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