Duncan Wanblad, CEO of Anglo American plc (GB:AAL), is determined to fight the current challenges impacting the mining industry. Macro headwinds, including geopolitical issues, have led to a huge decline in demand for platinum group metals (PGMs) and a steep drop in commodity prices. Despite pressure to sell assets, Wanblad is confident about leading the company through the ongoing headwinds more efficiently than any activist investor, he claimed at the African Mining Indaba in Cape Town on Monday.
The African Mining Indaba is an annual conference that brings together industry experts and professionals to provide key insights about the mining industry.
Wanblad is facing immense scrutiny due to the significant decline in the AAL share price since he assumed the role of the company’s CEO in April 2022. Macro challenges have made matters worse, with AAL shares down over 45% in the past year.
FTSE 100-listed Anglo American is the world’s largest platinum producer. It also mines diamonds, copper, nickel, iron ore, and steelmaking coal.
Anglo American CEO Dismisses Activist Pressure
The challenges in the commodity market have not spared even the toughest of miners. As a means to circumvent the issues, Anglo American announced massive production cuts and a reduction in capital spending by $1.8 billion through 2026. The sluggish demand is aggravated by rising costs and operational challenges at Anglo American’s South African businesses.
Some analysts believe that Anglo American is a potential takeover or merger candidate. Even so, Wanblad is confident that he has the maximum experience and is the best person to steer the company through the muddy waters rather than any other activist investor. Wanblad does not want to make any hasty decisions of selling off underperforming assets due to short-term issues.
That said, Wanblad does not see any immediate recovery in the PGM sector. He also cautioned of job cuts in the PGM business at the South African units. Meanwhile, Anglo American is seeking new copper mining sites in African countries, including the Democratic Republic of Congo (DRC). The new sites will have to fulfil two important criteria, the site should be economically viable and meet the company’s environmental, social, and governance (ESG) standards, Wanblad added.
Is Anglo American a Good Stock to Buy?
On TipRanks, AAL stock has a Moderate Buy consensus rating based on seven Buys versus six Holds. The Anglo American plc share price target of 2,416.69p implies 32.9% upside potential from current levels.
