Glencore 1H losses and debt widen as trading and mining profits fall

Glencore

Glencore 1H losses and debt increased on weak prices and lower output. The group cited US trade policy shifts and Middle East risk. Glencore 1H losses and debt also reflected an $859mn Cerrejon impairment.

Markets, prices, and earnings drivers

Commodity markets looked well supplied in the half. Therefore benchmark coal and crude prices dropped sharply. Industrial Ebitda fell 17pc on lower coal prices and weaker copper production. Marketing Ebitda decreased 6.5pc as trading margins narrowed. Management warned the full effects of geopolitics are still coming.

Balance sheet and cost actions

Glencore’s net debt rose 30pc to $14.5bn at 30 June. The rise followed lower funds from operations and higher interest costs. Net finance costs increased 19pc as rates stayed elevated. However, Glencore guided debt to “meaningfully reduce” by year end. The firm identified $1bn in recurring industrial cost savings by 2026.

Profits, impairments, and outlook

An $859mn impairment at Cerrejon deepened the reported loss to $665mn. Last year’s first half loss was $233mn, underscoring the swing. Meanwhile, copper production fell, adding pressure to industrial earnings. As a result, Glencore 1H losses and debt remain a central focus. Management will prioritize cash discipline and capital allocation. Investors will watch working capital unwind and price momentum.

The Metalnomist Commentary

Glencore’s diversified model helps, but softer coal and copper can overwhelm marketing resilience. Watch diesel spreads, copper TCRCs, and coal curves for recovery signs. Execution on the $1bn cost program and faster working capital release could stabilize leverage.