Shares in Anglo American were down 7.26 per cent at 300.15p per share today, in the wake of what the miner described as a “dramatic” overhaul to its strategy yesterday.
A rout in global commodity prices has helped send the company’s shares down around 75 per cent since the beginning of this year. This has heaped pressure on mining companies' credit ratings and dividends, leading to a number of business restructurings.
Recognising the gravity of the situation, Anglo yesterday suspended its dividend for the second half of 2015 and next year, announced plans to shrink its workforce around 60 per cent and consolidate its business from six to three units. Its shares closed around 12 per cent lower yesterday.
"Anglo American outlined an essentially unchanged strategy, but one which it hopes to deliver with heightened urgency given weak commodity markets,” Nick Hatch, analyst at Canaccord Genuity, said.
The focus remains on cost control, debt reduction, portfolio optimisation and restructuring. The only new development was the suspension of the company's dividend, a move that we had anticipated.”