Longer term Mick Davis remains optimistic

Very discrete nature, Mick Davis, Xstrata pattern, did not become a master in business communication. He gave a beautiful demo yesterday to drag to the second plan the dizzying fall in the operational efficiency of its company in 2009 through activity in the medium term prospects that he did not hesitate to characterize as "very promising". His presentation of the annual accounts of the number five world of mines has nonetheless pointed the fact that if "is obvious to the gradual recovery of the real economy, structural problems remain: the debt of consumers; the reforms of the banking system; "growing national debt and unemployment."

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Longer term, Mick Davis remains optimistic. "Secular demand for raw materials remains strong", he summed up. It is supported both by China and the other major countries in the process of industrialization, urbanization and industrialization based on a strong growth of natural resources as well as reforms Chinese to increase domestic consumption. This is why Xstrata has not spared the development of its activities, including during the recession.

The Group has acted in two times. First, early 2009 was entirely dedicated to the shed in order through the decline in production, the reduction of the train of life, refinancing of the debt and the appeal to the market to bail out unions. Debt has thus been compressed by 23 to $ 12.3 billion end of 2009, while deadlines were spreading, the first speaker to mid-2011. The ratio of net debt increased from 40 to 26 with the successful show, beginning of 2009, new share subscription rights to lift $ 3.7 billion net of the acquisition of Prodeco at Glencore (its shareholder of reference with 35 of the capital) for $ 2 billion. As immediately available cash, they were at the end of the fiscal year to $ 6.3 billion including lines of credit. At the time, Xstrata returned to the payment of dividends from may of this year.

Decrease in net sales

From an operational point of view, Xstrata has made in the first months of 2009 a removal "unprecedented" in its history, which ended, by adding a hunting unnecessary spending, by net actual savings of more than $ 500 million.

However, all of the measures taken have not avoided the group suffered a net decline of its annual turnover (-16, to $ 23.5 billion) and profit attributable to shareholders (-41, to $ 2.77 billion). According to analysts, the profits from its activities in the copper and coal were nevertheless better than expected. These two divisions accounted for 41 and 43 of the overall operational result respectively. The disappointment came from the branches nickel and alloys, whose respective Ebitda melted nearly half and 98. Conversely, Xstrata Zinc has almost doubled its operating income by virtue of a decline of 25 of the average cash cost.

For the suite, Mick Davis has developed the new strategy of the group, which will mainly focus on organic growth. The failure of the mega-merger with Vale first and Anglo American then led the mining company to refocus on capital expenditures (14 billion already provided for in the next three years). Sometimes criticized due to its high cost of development, the major project in the Koniambo nickel in New Caledonia, was vigorously defended yesterday by Mick Davis himself. It will start running first half of 2012. Yesterday, the action of Xstrata listed in London took 3.56.