Anglo American to Sell De Beers for $1B, JSE: ANG Share Price Rallies on Strong Copper Results Ahead of Teck Merger
Anglo American shares extended their uptrend after stronger first-half earnings and cash generation highlighted the benefits of its copper-focused strategy, although much of the positive news may already be reflected in the stock price.
Anglo American shares extended their uptrend after stronger first-half earnings and cash generation highlighted the benefits of its copper-focused strategy, although much of the positive news may already be reflected in the stock price.
Copper Leads Profit Growth
Anglo American’s simplified portfolio generated $4.1 billion in EBITDA, an increase of 31% from the previous year. The EBITDA margin reached 46%, while underlying earnings increased 60% to $1 billion.
Around 70% of portfolio EBITDA came from copper, highlighting the metal’s growing importance to the company’s investment case.
Revenue increased 22%, while copper production reached 344,000 tonnes during the first half. Anglo American remains on track to achieve its full-year production target of between 700,000 and 760,000 tonnes.
The company’s commodity-price basket increased 22%, primarily because of stronger copper prices, while iron ore prices were slightly weaker.
Cash Generation Improves as Debt Falls
The stronger earnings performance also supported cash generation.
Net debt declined to $8.2 billion from $8.6 billion at the end of last year, while net debt-to-EBITDA stood at approximately one times.
Cash flow from operations reached $3.5 billion, generating around $1.2 billion in sustaining attributable free cash flow.
Anglo American declared a dividend of $0.23 per share, consistent with its 40% payout policy.
However, management warned that working capital requirements, cash taxes and distributions to minority shareholders are likely to increase during the second half, potentially reducing some of the benefit from the strong first-half cash position.
Anglo American Shares Rise as Copper Drives Strong First-Half Results
Anglo American shares gained 2.9%, extending their recent uptrend after the mining group reported stronger first-half earnings and cash generation. Higher copper prices, improved by-product credits and tighter cost control helped offset inflationary pressures and supported the company’s simplified portfolio.
The results provide early evidence that Anglo American’s strategy of concentrating on copper and premium iron ore is beginning to deliver financial benefits. However, after the recent share-price strength, investors may question how much of the improvement is already priced into the stock.
Cost Control Provides Additional Support
Operating costs across the simplified portfolio increased by approximately $600 million to $4.8 billion, reflecting inflation, foreign exchange movements, fuel and freight expenses, and higher activity at several operations.
Despite these pressures, copper unit costs fell 12% to $1.36 per pound, helped by stronger by-product credits and treatment and refining charge effects.
By-product credits increased to $600 million from $300 million a year earlier, supported by stronger molybdenum and silver revenues from operations in Chile and Peru.
Anglo American also reduced its 2026 capital expenditure guidance for the continuing portfolio by $400 million to approximately $3.2 billion.
Copper Expansion Provides Longer-Term Potential
Several major projects could further increase Anglo American’s copper production.
At Quellaveco, the company has completed plant debottlenecking and expects processing capacity to approach 150,000 tonnes per day, although water availability remains a key constraint.
Anglo American also received final regulatory approval for a joint mine plan involving Los Bronces and Codelco’s neighboring Andina operation. The project could add approximately 120,000 tonnes of annual copper production, split equally between the partners.
The company is also evaluating the potential integration of Collahuasi and Quebrada Blanca, which could eventually add around 175,000 tonnes of annual copper production, although the project remains at an early stage.
Asset Sales and Teck Merger Remain Key Catalysts
Anglo American continues reshaping its portfolio through asset sales.
The company agreed to sell its steelmaking coal business to Dhilmar for up to $3.9 billion, while its nickel business is being sold to MMG for up to $500 million.
For De Beers, management is pursuing a trade sale rather than an initial public offering because current market conditions are considered unfavorable for a listing.
Meanwhile, preparations for the proposed merger with Teck are advancing. Integration teams have been established, with both companies preparing for potential listings in New York and Toronto. The final major regulatory approval remains with China’s State Administration for Market Regulation.
Outlook
Anglo American’s latest results demonstrate that the shift toward copper is beginning to strengthen earnings, cash generation and the overall quality of its portfolio.
However, the 2.9% share-price gain also reflects how strongly investors have already responded to the copper story. Higher copper prices, lower debt, asset disposals and the potential Teck merger provide significant catalysts, but expectations are now elevated.
The company must continue delivering production growth, controlling costs and executing its restructuring strategy to justify further upside. For now, the fundamentals are improving, but investors may need increasingly stronger results to push Anglo American shares materially higher from current levels.
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