ii view: Glencore announces dividend surprise

Full-year results to 31 December

• Adjusted profit down 6% to $13.51 billion
• Net debt flat at $11.17 billion
• Ordinary dividend of $0.10 per share
• Special dividend of $0.07 per share

Chief executive Gary Nagle said:

"We remain focused on delivering on our 2026 priorities, achieving our operational targets and derisking and successfully progressing our organic production growth options, all with the objective of supporting long-term value creation for shareholders.”

• Our Services: SIPP Account | Stocks & Shares ISA | See all Investment Accounts

ii round-up:

Diversified miner Glencore (LSE:GLEN) today detailed bigger than expected shareholder returns, with annual 2025 profits slightly better than City forecasts.

An ordinary dividend of $0.10 per share was also accompanied by an unexpected special dividend of $0.07 per share, making for a total return of $2 billion. The payment is to be made to eligible shareholders in two equal instalments of $0.085 per share during June and September. 

A more than 40% gain in the price of copper in 2025 was countered by a 14% fall in coal prices, helping leave adjusted profits down 6% at $13.51 billion. Analysts had forecast profits of $13.3 billion. 

Shares in the FTSE 100 company rose 3% in UK trading having come into these latest results up 15% over last year. The FTSE 100 index rose by just over a fifth in 2025, while fellow diversified miner Rio Tinto Ordinary Shares (LSE:RIO) climbed by just over a quarter. 

Glencore is both a producer and trader of more than 60 different commodities. The Swiss headquartered company previously abandoned merger talks with rival Rio Tinto.

Glencore plans to become one of the world's largest copper producers over the next decade. A production target of 1 million tonnes by 2028 climbs to 1.6 million tonnes by 2035. That’s up from 2025’s 852,000 tonnes. Copper currently generates around a quarter of Glencore profits.

Steel making coal output during 2025 rose 63% to 32.5 million tonnes (mt) with energy coal production staying almost flat at 98 mt. Coal accounts for a further quarter of Glencore profits. 

Group year-end net debt of $11.7 billion remained little changed year-over-year although came in below City estimates for a rise to $11.7 billion. 

In a separate announcement, Glencore flagged an agreement for land access with partner Gécamines at the Katanga copper mine in in the Democratic Republic of Congo, furthering its copper ambitions. 

Broker Morgan Stanley reiterated its ‘overweight’ stance on the shares post the results. A first quarter 2026 production update is scheduled for 30 April. 

ii view:

Started in 1974 and merging with Xstrata in 2013, Glencore today employs over 140,000 staff and contractors globally. Mining operations generated most profits during this latest year at just under three-quarters with Marketing or trading most of the balance of just under a quarter. Other group commodities include Cobalt, Nickel, Zinc and Vanadium all used in battery production as well as Aluminium.

For investors, Glencore’s involvement in coal production may deter some new investors given coal’s part in climate change. A trade deal between the world’s two biggest economies, the US and China, has yet to be agreed. Exposure to political instability in countries of operation such as the Democratic Republic of the Congo warrants consideration, while an estimated share price-to-net asset value above the three-year average may suggest the shares are not obviously cheap. 

• Where to invest in Q1 2026? Four experts have their say
• BP hits skids as share buybacks scrapped
• Why fund managers are ‘uber-bullish’ despite AI concerns

To the upside, exposure to energy transition metals such as copper, cobalt and zinc, used in batteries, offers exposure to energy transition. The trading or marketing business provides diversity not seen at other miners, with US tariff uncertainties possibly buoying volumes. An arguable backtracking on global climate change aspirations may leave its involvement in energy coal looking more sensible, while a ratio of net debt to adjusted profits (EBITDA) of 0.83 times as of late December points to relatively robust balance sheet.

In all, and despite ongoing risks, Glencore’s diversity of operations and a consensus analyst estimate of fair value above 535p per share look to offer grounds for continued optimism.  

Positives: 

• Diversity of commodities and operations
• $25.3 billion of announced shareholder returns since 2021

Negatives:

• Uncertain economic outlook
• The weather can hinder production

The average rating of stock market analysts:

Buy