(Reuters) - Anglo American Plc on Thursday posted better-than-expected underlying core earnings, driven by higher prices of several commodities, strong volumes and lower costs.
Anglo, which was among the miners hardest hit by the 2015-16 commodities price crash, has since made one of the strongest recoveries by shedding assets and improving its balance sheet.
Average market prices for the company's basket of commodities and products rose 4 percent, boosting underlying core earnings by $900 million (690.61 million pounds), Anglo said.
A 3 percent rise in metallurgical coal prices and a 14 percent rise in thermal coal prices bolstered results. Coal is the largest contributor to the company's profit, making up more than a third of the total.
Earnings from copper, which makes up about 20 percent of the company's core profit, also rose 23 percent, boosted by a 15 percent rise in production and a 9 percent fall in unit costs.
The company, which also mines diamonds, iron ore and nickel, said it expects 2019 costs and volumes to improve by $500 million, and added that it was on track to deliver $3 billion to $4 billion annual EBITDA improvement by 2022, relative to 2017.
Underlying earnings before interest, tax, depreciation and amortisation rose to $9.16 billion from $8.82 billion, a year earlier. The figure beat analysts' average estimate of $8.7 billion, according to Refinitiv IBES data.
The results follow BHP Group, which posted a drop in first-half 2019 profit, hurt by rising costs. Glencore on Wednesday said weaker cobalt prices dented earnings at its trading division, but strength in other commodities helped the company to post an 8 percent jump in core profit and announce a share buyback programme worth up to $3 billion.
Anglo shares have outperformed its peers, driven in part by its prospects for copper, a metal playing a major role in electric vehicle technology.
(Reporting by Arathy S Nair and Samantha Machado in Bengaluru; Editing by Bernard Orr)