Glencore Plc said electric vehicles and batteries will unlock future demand for metals as the company positions itself for growth after a business turnaround in the past two years.
While the commodity trader and miner reported slightly lower-than-expected earnings, it continued to cut debt and cited “significantly better commodity prices” behind profit growth.
“The potential large-scale roll out of electric vehicles and energy storage systems looks set to unlock material new sources of demand for enabling underlying commodities, including copper, cobalt, zinc and nickel,” Chief Executive Officer Ivan Glasenberg said in a statement.
Glasenberg has turned around the business from a 2015 crisis, when investors dumped shares on concern debt was too high to weather a prolonged downturn in commodities. Debt levels are now much lower thanks to asset sales, cost cuts and rebounding metals prices.
Adjusted Ebitda for the first half was $6.74 billion. That compares with analyst estimates for $6.80 billion. The company’s marketing division reported adjusted Ebit that rose 13 percent to $1.4 billion, citing “improving fundamentals” for the company’s core commodities.