Anglo American Axes 19,000 Jobs

2008 net earnings fell 29%

Global mining giant Anglo American said on Feb. 20 it will cut 19,000 jobs this year after posting a 29% fall in 2008 net earnings -- the latest victim in a worldwide slump in demand for raw materials. The cuts, amounting to 10% of the company's global workforce, are part of a drive to save $2 billion a year between now and 2011.

The group said it was reacting to sharp falls in commodity prices brought on by a contraction in the global economy and that its net earnings had fallen to $5.2 billion.

The job cuts include the 10,000 announced last week by Anglo Platinum, the world's biggest platinum producer which is 77% owned by Anglo American.

"As we begin 2009, the economic outlook remains weak, with limited visibility and we are continuing to experience volatility and downward pressure on commodity prices," chief executive Cynthia Carroll said. "Against this backdrop, we have acted decisively to position the group through the downturn, including pulling back planned production growth, reducing the size of our workforce by 19,000 by the end of 2009 in line with our revised production and growth plans and further cost cutting."

Anglo American's revenues fell 7.6% to $32.964 billion last year, while the group added that it had suspended shareholder dividend payments and will not give a dividend for 2008.

The group had already announced in December that it would reduce its 2009 investment program by half to $4.5 billion because of global economic uncertainty and weak metal prices.

Carroll, who has headed the Anglo-South African firm since March 2007, added that the group was upbeat despite the uncertain economic climate. "Despite the current economic environment, we have confidence in the fundamentals and long term outlook for our core commodities," she said.

Anglo American is a diversified enterprise, producing platinum, coal and base metals such as copper, zinc and nickel. It also has a 45% stake in De Beers, the world's largest diamond company.

It is the largest mining company in South Africa and generates about two thirds of its earnings there.

Copyright Agence France-Presse, 2009

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