Mining giant Glencore has decided not to pursue plans to relocate its primary stock market listing from London to New York. This announcement comes alongside a significant cost-cutting initiative aimed at reducing expenses by approximately $1 billion over the next few years. The decision marks a notable shift for the Swiss-based company, which is also one of Australia’s largest coal producers, with extensive operations in New South Wales and Queensland.
In a statement accompanying its half-year results, Glencore indicated that the analysis revealed that a move to New York would not provide better value for shareholders. This decision is a relief for the London Stock Market, which has been facing challenges in retaining major listings. Gary Nagle, CEO of Glencore, emphasized the thorough research conducted regarding the potential relocation. He stated, “A move in our primary listing … would not be value accretive for Glencore at this stage, having done that thorough analysis, and therefore we keep it on a watching brief, but will remain listed in London for the moment.”
As part of the broader strategy to enhance financial performance, Glencore announced plans to implement job cuts affecting its global workforce of approximately 150,000. The company aims to achieve over half of the targeted cost reductions by the end of 2023, with the full goal set for completion by the end of 2026. These savings are expected to arise from streamlining operations across various sectors, including energy, consumables, contractors, maintenance, and administrative functions.
The need for cost-cutting measures is underscored by Glencore’s recent financial performance. The company reported a 14 percent decline in underlying earnings, totaling $5.43 billion. In a more concerning trend, net losses nearly tripled to $655 million, compared to $233 million the previous year. This downturn has led analysts to suggest that a relisting in New York might revitalize investor interest.
Despite these suggestions, Nagle attributed the company’s share price decline, which has fallen 26 percent over the past year, to lower coal prices rather than a lack of confidence in its strategy. The company remains focused on adapting to market conditions while ensuring shareholder value remains a priority.
As Glencore navigates these challenges, the commitment to its London listing and the operational restructuring reflect its strategy to stabilize its financial outlook in an evolving global market.
