(Correcting fourth-quarter output for Anglo American Platinum.)

Anglo American PLC on Thursday reported mixed production performance in 2023 as iron ore battled against rail constraints in South Africa and platinum operations faced persistent inflationary pressures, while copper volumes in Peru were robust.

The London-based miner said copper production rose 24% to 826,000 tonnes in 2023 from 664,000 tonnes in 2022. But output was down 6% in the fourth quarter to 230,000 tonnes from 244,000 tonnes. It said its Quellaveco mine in Peru delivered its strongest quarter yet of 93,700 tonnes of copper.

Annual platinum group metal production fell 5% to 3.8 million from 4.0 million, while output in the fourth quarter declined 6% to 932,000 ounces from 990,000 ounces.

In a separate filing, Anglo American Platinum Ltd, in which Anglo American holds 80% interest, said on Thursday total refined production inched down 1% to 4.42 million ounces in 2023 from 4.45 million ounces in 2022. For the fourth quarter, output rose 21% to 1.4 million ounces from 1.1 million ounces.

Anglo American Platinum also said it expects earnings per share to plunge to a range of between 3,836 rand cents and 5,697 cents in 2023, from 18,667 cents in 2022, due to a slump in revenue as a result of a 35% lower realised PGM basket price relative to 2022.

Headline EPS is seen between 4,216 cents and 6,077 cents, down sharply from 18,542 cents.

The platinum producer said continued inflationary pressures and exchange rate volatility had also led to higher mining and processing costs.

Turning to iron ore, Anglo American said full-year production edged 1% higher to 59.9 million tonnes from 59.3 million tonnes. Output for the fourth quarter dropped 12% to 13.8 million tonnes from 15.7 million tonnes, despite strong performane in Brazil.

Minas-Rio in Brazil delivered its highest ever quarterly volume of 6.6 million tonnes of premium high-grade iron ore, Anglo American said.

Kumba Iron Ore Ltd, another subsidiary in which Anglo American owns 70% stake, said separately iron ore production declined 5.3% to 35.7 million tones in 2023 from 37.7 million tonnes, in line with its revised guidance of 35 million tonnes and 36 million tonnes. For the fourth quarter, output slumped 38% to 9.9 million tonnes from 7.2 million tonnes.

‘Following the completion of the annual logistics maintenance shutdown by Transnet in October 2023, rail performance challenges continued to place significant pressure on our value chain. Ore railed to Saldanha Bay Port decreased by 19% in Q4 2023 compared to Q3 2023, resulting in on-mine stockpiles increasing to unsustainable levels,’ Kumba Chief Executive Officer Mpumi Zikalala said.

Anglo Amerian said steelmaking coal production was up 7.0% to 16.0 million tonnes in 2023 from 15.0 million tonnes in 2022. Output for the fourth quarter was 4.8 million tonnes, up 2% from 4.6 million tonnes.

Diamond production fell 8% to 31.9 million carats in 2023 from 34.6 million carats in 2022. Output was 3% lower at 7.9 million carats in the fourth quarter from 8.2 million carats.

Nickel production on an annual basis rose slightly 1% to 40,000 tonnes from 39,800 tonnes, while fourth-quarter output improved 9% to 11,100 tonnes from 10,200 tonnes.

Annually, manganese ore production fell 2% to 3.67 million tonnes from 3.74 million tonnes. Output for the fourth quarter declined 14% to 848,000 tonnes from 984,000 tonnes.

Anglo American Chief Executive Duncan Wanblad said the company’s fourth-quarter production was in line with its expectations and in line with the third quarter.

Looking ahead, Wanblad said the group’s ‘deliberate’ prioritisation of value over volume is designed to improve profit margins and shareholder returns.

For 2024, PGM production is guided to between 3.3 million ounces and 3.7 million ounces.

Copper production is seen between 730,000 tonnes and 790,000 tonnes.

Iron ore output is projected to be between 58 million tonnes and 68 million tonnes, and steelmaking coal is likely to rise to between 15 million and 17 million tonnes.

Diamond production is seen slowing to between 29 million carats and 32 million carats. Nickel is expected at between 36,000 tonnes and 38,000 tonnes.

Shares in Anglo American were up 1.7% to 1,783.60 pence each in London early Thursday. In Johannesburg, they were up 1.3% to R 428.12 each. Anglo American Platinum shares were down 6.6% at R 723.33. Kumba shares were up 1.7% at R 559.45.

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