Glencore plc

Ladies and gentlemen, thank you for standing by and welcome to the Glencore Interview Results 2022 webcast and conference call. At this time, all participants are in list and only mode. After the speaker presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 1 and 1 on your telephone keyboard. I must advise you that this conference is being recorded today, the 4th of August 2022. I would now like to end the conference over to Mr. Martin Fewings, Head of Investor Relations. Please go ahead, sir.

Good morning. Thank you for joining our half-year 2022 results call. I'm joined today by our CEO, Gary Nagel, and our CFO, Stephen Kalman. I will now hand the call over to Gary.

Hi, good morning, and those who aren't in Europe or in South Africa, good afternoon, good evening, wherever it is in the world you are. Thanks for joining us. We'll move straight into the presentation and start off with our 2022 half-year scorecard. As you would have noted from our release this morning, on the financial side, a record half-year result for our group, an adjusted EBITDA print of just short of $19 billion. On the industrial side, that's $15 billion with the largest proportion coming from coal and a record in our marketing business within an adjusted EBIT of $3.7 billion as we foreshadowed a few weeks ago in our release. On the balance sheet side, net debt down to just $2.3 billion at the end of June. allowing us to return significant amounts of money to our shareholders. And we are declaring today a top-up shareholder return of $4.5 billion. That's made up of $3 billion in barbacks and $1.45 billion in cash returns to our shareholders. And that is consistent with our capital returns policy that we've outlined in previous presentations and that you'll find at the back of this presentation. That $4.5 billion return to shareholders brings our total 2022 return to shareholders to $8.5 billion, which is an exceptional achievement. On the industrial side, as I mentioned, the real standout this time around has been coal. You'll remember a year ago, the first half of last year, coal's earnings were less than $1 billion, but with the energy crisis and the requirements the world needs for stable base-dode energy, Coal prices have surged. We've also obviously taken over the remaining share of Cerrojon in the early part of January this year, and that's helped underpin this big increase in adjusted EBITDA for our industrial business. Obviously, on the negative side, we do see some headwinds on the inflationary side, as all our peers do and as the market does, and we continue our processes and programs to try to contain those costs, but certainly there are some headwinds on the inflationary side in our mining and processing business. EBITDA margins have remained very healthy, with metals EBITDA margins remaining consistent year on year, and our coal margins, obviously with a higher coal price, have been exceptionally strong. On the marketing side, a record performance for the first half. And in fact, as we've mentioned earlier, we've exceeded our full 12-month guarded range of $2.2 to $3.2 billion EBIT with a $3.7 billion achievement in the first six months of this year. And really, it's underpinned by exceptionally strong energy trading performance across the board, which has contributed to this strong performance. Moving over to our ESG scorecard, on the environmental side, we are taking significant steps in progressing our decarbonization pathway. Just some examples, we have locked in a number of renewable purchase power agreements, two significant ones, one for Antipakai and a second one at our Kazakhstan operations, which will greatly reduce our scope two emissions in our business. We've also entered into a multi-year supply collaboration with General Motors for Cobalt, assisting them in their transition to growing an electric vehicle fleet business. And as we also announced earlier in the half, we've partnered with Lifecycle, which is a recycling company promoting the circularity in battery raw material supply chains, and that we believe is a large step in our continued growth in our recycling business. On the social side, we are very upset to report that we've had two fatalities year to date. These fatalities, we believe, are preventable, and it is our job and our responsibility to eliminate all fatalities in our business, and we continue to work every day and ensure it's our number one priority within this business to eliminate all harm, not just fatalities, but all harm in this business, and it's work that will continue nonstop. On the governance side, earlier this year, we announced the fact that we had resolved our investigations by the Department of Justice, the UKSFO, and the Brazilian authorities. That was announced in April this year. And if you look at that in the context of who we are as a company, our strength is not just because of our results. The foundation of our lasting success has been the culture and our people and the way we operate as a company. It's important to understand from our perspective as a board and as a management team that this kind of conduct has no place in Glencoe today. We will learn from this conduct and we will improve this business going forward. Ethics, compliance, and sustainability must be the forefront of every decision we make in this company, and they will be. And I've been clear with the management team and with all our employees around the world that we make that a cornerstone of our business. We have a world-class ethics and compliance program, and I truly believe it's world-class. And this is something that promotes good business but stops dead in its tracks any idea of something that is unacceptable in our business. We have put this behind us. We move forward as a transparent and responsible and ethical operator and we hope to be able to provide continued great returns to our shareholders and all our stakeholders on the basis of being this responsible and ethical operator. With that, I'll turn it over to Steve to talk through the financial performance for the first half.