Glencore’s (GLEN) financial statements are far from opaque; quite the opposite, in fact. But you get some idea of the number of moving parts in the business from the $9.6bn (£7.2bn) on the balance sheet given over to physical forwards, swaps and various other forms of derivatives.
Shareholders in the FTSE 100 group will be pleased with its progress in the first half of the year, a period characterised by volatility and increased risk in global energy markets due to events in the Middle East – fertile ground for Glencore.
Supplies of oil, refined products and liquefied natural gas were constrained from the end of February following the commencement of military action by the US and Israel against Iran. The shortfalls, and consequent rerouting, of other industrial inputs, such as fertilisers, industrial metals and chemicals, duly followed.
With arbitrage the order of the day, it was not altogether surprising that Glencore saw a 142 per cent increase in adjusted trading profit on its marketing activities.
The disruption to trade flows wasn’t wholly favourable where the group’s industrial segment was concerned, even though underlying commodity prices were generally on the rise. Mines and extractive industries rely on diesel and other consumables, so events in the Strait of Hormuz weren’t ideal from that perspective. But even though the segment had to cope with higher operating costs, it still booked adjusted cash profits of $6.5bn – a 72 per cent increase on the prior quarter.
All this fed through to an 86 per cent increase in group cash profits to $10.1bn, while net income attributable to equity holders came in at $4.4bn, against a loss of $508mn in the first half of 2025. The group anticipates cash profits of about $19.7bn for the full year on the back of rising metallurgical coal demand.
Additions to receivables and inventories resulted in increased working capital demands and constrained net operating cash flow, but the strengthening commercial performance underpinned an increased distribution, together with a new $500mn share buyback to be completed by February 2027.
FactSet consensus gives earnings per share of 42.9¢, rising to 45¢ in 2027.
Following the abandonment of the touted Rio Tinto (RIO) merger, Glencore revealed that it is preparing to seek a secondary listing in Australia – another sign that the centre of gravity for mining stocks has moved down under.
Valuations for Glencore are problematic because trailing price/earnings can be unreliable for commodity traders due to the cyclical nature of their activities. However, its enterprise value/cash profit (earnings before interest, tax, depreciation and amortisation) multiple of 6.2 suggests the market is up to speed based on historical reference points. Hold.
Last IC view: Buy, 503p, 18 Feb 2026
GLENCORE (GLEN) ORD PRICE:568pMARKET VALUE:£66.7bnTOUCH:567-568p12-MONTH HIGH:707pLOW: 275pDIVIDEND YIELD:1.3%PE RATIO:17NET ASSET VALUE:355¢NET DEBT:113%Half-year to 30 JunTurnover ($bn)Pre-tax profit ($bn)Earnings per share (¢)Dividend per share (¢))2025117-1.13-5.05.020261744.8937.08.5% change+49–+70Ex-div:27 AugPayment:18 Sep£1 = $1.34