Mining giant whose shares soared 400pc in 16 months

SHARES at commodities giant Glencore have soared almost 400pc in 16 months as it notched up an 18pc rise in profits.

The world’s largest diversified commodities trader said it made £8bn last year, sending shares up 1.72pc, or 5.6p, to 331.35p.

It marks a major turnaround for the company, which only restored its dividend this year after nearly being destroyed by debt in 2015. Shares have risen 316pc since lows of 68p in September 2015.

Chief executive Ivan Glasenberg, 60, said shareholders could now be in line for a further reward, with extra cash available for deals or dividends. He said: ‘We could do many things. We could give our long-suffering shareholders a generous gift of a special dividend. That would not be a bad thing to do.’

In 2015 Glencore was forced to raise £1.6bn by issuing new shares as it struggled with debt and a slowdown in China.

But it has since been selling assets and has been boosted by rising prices for its products, leading to yesterday’s announcement that debt had fallen by £11bn, to £12bn.

In December it announced it would restart its dividend, dishing out £800m before launching a new dividend policy next year.

That will see investors share a minimum £800m from its trading division plus a further dividend from its mining arm worth at least 25pc of cash flow.

Glencore follows other miners in recovering during 2016, with BHP Billiton, Rio Tinto and Anglo American all returning to profit. Rising commodity prices have helped, but it has also been reining in expenses.

The Switzerland-based company, which floated in 2011 and then took over rival Xstrata, produces more than 90 commodities from around 150 mining and metals sites.

Glasenberg, who was paid £1.5m in 2015, said: ‘Glencore has never been so well positioned as it is today.

‘As we look forward, increasingly favourable fundamentals provide the potential to create significant long-term value for Glencore shareholders.’

The results beat market expectations. Bernstein analysts said while revenue was still uncertain due to volatility in commodity prices, Glencore was committed to paying down debts, adding: ‘The results were solid and we applaud the company’s supply discipline again.’

In an update yesterday, the company said 16 people died in its mines in 2016, which it said was unacceptable.