This article first appeared on GuruFocus.
Adjusted EBITDA: $10.1 billion for the first half of 2026.
Adjusted Industrial EBITDA: $6.5 billion, driven by strong metals and minerals and energy/steelmaking coal contributions.
Adjusted Marketing EBIT: $3.3 billion, a near-record first-half result, driven by disrupted energy and freight markets.
Net Income: $4.4 billion for the half.
Funds from Operations: $8.1 billion, up 158% year-over-year.
Net Debt: $10.2 billion, a reduction of $1 billion from the start of the year.
Shareholder Returns: Declared a top-up shareholder return of $1.5 billion, comprising $1 billion in cash and $0.5 billion in buybacks.
Industrial EBITDA Bridge: Positive price movements of $3.8 billion, offset by negative cost variances of $1.1 billion and negative currency impacts of $0.4 billion.
Copper Business EBITDA: Increased from $1.1 billion to $3.0 billion year-over-year.
African Copper EBITDA: Increased from $0.1 billion to over $1 billion.
Copper Production (Africa): Increased by 55,000 tons to 138,000 tons, up 66%.
Industrial Oil EBITDA: Increased from $164 million to $432 million.
Industrial CapEx: $3.9 billion in the first half, up from $3.4 billion.
CapEx Guidance: Increased by 5% on average over 3 years to $6.8 billion, reflecting inflationary pressures.
Steelmaking Coal Realized Price: $2,069 per ton, up 24%.
Energy Coal Realized Price: $93.9 per ton, up 90%.
Release Date: August 05, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
Glencore PLC (GLCNF) delivered a strong first half with adjusted EBITDA of $10.1 billion, driven by a near-record marketing performance of $3.3 billion and a 72% increase in industrial EBITDA to $6.5 billion.
The company’s copper growth portfolio is advancing well, with the Alumbrera restart ahead of schedule (first production expected in late 2027) and the KCC land package secured, underpinning the path to 1 million tons of annual copper production by 2028.
Glencore PLC (GLCNF) announced a $1.5 billion top-up shareholder return, including a $1 billion cash distribution and a $500 million buyback, reflecting strong cash generation and confidence in the business.
The company plans a secondary listing on the Australian Stock Exchange (ASX) in October 2026, aiming for ASX 200 inclusion within 12 months, which is expected to unlock significant demand from Australian super funds and improve its valuation multiple.
Marketing performance was exceptionally strong, with a near-record $3.3 billion EBIT, driven by disrupted energy and freight markets creating significant arbitrage and trading opportunities, particularly in oil and gas.
The company maintained its full-year production guidance and delivered within guidance for the first half, with strong volume growth in copper, particularly from African operations, which saw EBITDA surge from $0.1 billion to over $1 billion.
Glencore PLC (GLCNF) is progressing its strategic partnership with Orion Critical Minerals for its DRC operations, which could bring the US as a strategic shareholder and potentially unlock further value.
The company’s balance sheet remains strong with net debt of $10.2 billion, and it generated $8.1 billion in funds from operations, a 158% increase year-on-year.
Glencore PLC (GLCNF) is actively managing its portfolio, having sold non-core assets like the Kidd mine and Lady Loretta, which also released significant rehabilitation provisions.
The company sees a positive long-term outlook for thermal coal, with increased recognition of energy reliability and a potential step-up in base demand, which could support higher long-term coal prices.
Negative Points
Glencore PLC (GLCNF) reported a tragic safety regression, with the loss of four colleagues in two incidents, highlighting a critical area of concern that the company is urgently addressing.
The company faced significant cost pressures, including a $1.1 billion negative cost variance, driven by higher diesel, sulfur, and sulfuric acid prices, exacerbated by Middle East conflict and supply chain disruptions.
The company’s copper unit costs are expected to be higher than previous guidance, with transitory impacts from fuel, sulfur, and sulfuric acid costs, as well as a non-cash increase from processing cobalt in solution rather than final hydroxide form.
Marketing EBIT for the first half was exceptionally high at $3.3 billion, but the company’s indicative full-year guidance suggests a significant slowdown in the second half, implying a potential normalization of trading conditions.
The company’s zinc business saw a decline in volume, primarily due to lower gold byproduct production from its Kazakhstan operations, with expectations of a recovery only in the second half.
Glencore PLC (GLCNF) faces uncertainty around the potential US copper tariffs, which could lead to a pullback in copper prices once announced, as the market has already priced in front-running demand.
The company’s net debt increased to $10.2 billion, partly due to a $1.9 billion increase in non-RMI working capital, including margin calls and physical forward transactions, which could unwind or persist depending on market conditions.
The company’s capital expenditure guidance has been raised by 5% over three years to reflect inflationary pressures, which could impact future cash flows and returns.
The company’s steelmaking coal production is tracking lighter than expected in the first half, with a reliance on a stronger second half to meet full-year guidance.
The company’s marketing EBIT margin for metals and minerals was at a five-year low of 1.8%, which, while not a focus, indicates lower profitability relative to revenue in that segment.
Q & A Highlights
Q: Can you provide an update on the potential sale of a 40% stake in your DRC copper and cobalt operations to Orion Critical Minerals, and is the $9 billion valuation mentioned in the non-binding MOU a locked-in number?A: Gary Nagle (CEO) confirmed that progress is being made with Orion, though due diligence has been slower than hoped due to travel restrictions related to Ebola. He emphasized that the valuation in the MOU was an indicative range, not a locked-in number, and will be subject to commercial discussions after due diligence. The final terms will consider market conditions, the outlook for copper and cobalt, and the strategic benefit of having a US partner in the DRC.
Q: You announced a $1.5 billion top-up shareholder return, partly funded by the value of your Bunge stake. What does it take for the remaining $2 billion of surplus capital to be returned to shareholders?A: Steven Kalmin (CFO) explained that the $2 billion is “up for grabs” but will only be distributed as the Bunge stake is monetized in a value-accretive way. He noted that the current 40% payout ratio is conservative, and as the asset is sold down over time, the remaining value will be considered for distribution. He also clarified that the $10 billion net debt cap is not fixed forever and could be adjusted if the business grows significantly.
Q: Why is the metals and minerals marketing EBIT margin at 1.8%, the lowest in five years, despite a strong absolute performance?A: Steven Kalmin (CFO) stated that the margin percentage is not a metric the company focuses on for its marketing business. He explained that in a higher price environment, the derived margin percentage naturally shrinks because the revenue line inflates, but the absolute dollars of gross income and dollar-per-ton metrics are what matter. He noted that the metals business is performing near record levels in absolute terms.
Q: Can you provide more detail on the copper growth projects, specifically the leaching restart at Koniambo and the timing for the Antapaccay projects?A: Gary Nagle (CEO) said the leaching project at Koniambo is ahead of schedule, with first cathode expected by the end of this year, though volumes will be small initially. On Antapaccay, he emphasized that having both the Coroccohuayco and Quechua deposits provides maximum optionality. The company may delay one project by 6-12 months if it delivers better value, but this is not the base case. He stressed that the goal is to bring on value for shareholders, not just tons.
Q: With the ASX secondary listing, will you be able to pay franked dividends, and how does this impact the value proposition compared to a potential coal spin-off?A: Gary Nagle (CEO) confirmed that the ASX listing is a pure secondary listing, so no franking credits will be attached to dividends. He also stated that a coal spin-off is not being contemplated, as shareholders are comfortable with the current portfolio. The ASX listing is driven by reverse inquiry from Australian super funds that are restricted from investing in offshore lines, and the company aims for ASX 200 inclusion within 12 months and ASX 100 thereafter.
Q: How is the $1 billion cost-out program tracking, and how much of the cost increases seen in H1 are external versus controllable?A: Steven Kalmin (CFO) said the cost-out program is 80-90% complete and has been permanently embedded in the business. The cost increases in H1 were largely external, driven by higher diesel, sulfur, and sulfuric acid prices due to Middle East conflict disruptions. He noted that these external factors are expected to be transient, and once they reverse, the permanent cost savings will be more visible.
Q: Given the tight copper concentrate market, what is Glencore’s view on the potential shift away from long-term benchmark TC/RCs to more spot-based pricing?A: Gary Nagle (CEO) said it makes sense for the market to move away from long-term benchmarks given the increased volatility and spot trading, citing examples like chrome and Newcastle coal where benchmarks have fallen away. He views this as beneficial for Glencore, given its dual role as a producer and major marketer, allowing it to capitalize on volatility in TC/RC differentials.
Q: Why haven’t thermal coal prices responded more aggressively to the energy crisis, and what is the longer-term outlook for demand?A: Gary Nagle (CEO) explained that unlike 2022, when Europe was the driver of coal demand, this crisis is Asia-focused. Europe has more LNG import capacity now, so the demand pull is less extreme. However, he noted that two energy crises in four years have sharpened the resolve of utilities to maintain coal fleets as a backup, which could lead to a step-up in base demand and higher long-term coal prices.
Q: Are you seeing similar portfolio management opportunities as your peers, such as selling non-core assets or monetizing infrastructure?A: Gary Nagle (CEO) said the company went through an extensive divestment program of non-core assets 3-4 years ago, so there isn’t a long tail of assets to sell. However, he confirmed that the company is looking at infrastructure assets, such as the diesel plant at Koniambo and water treatment plants at EVR, for potential sale-and-leaseback or similar structures, but only if they make economic sense.
Q: Can you provide an update on the EVR steelmaking coal business, which appears to be underperforming its medium-term targets?A: Xavier Wagner (COO) said the company remains committed to its medium and long-term trajectory for EVR. He highlighted the FRX project as key to improving performance, with permitting progressing well. He acknowledged short-term issues around geotechnical, water, and seasonality challenges, but said the underlying fundamentals are improving and the company is confident in hitting its targets.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.