Parker caps Anglo’s sell-off

by: Mark Robinson and Emma Powell, Investors Chronicle

Shares in Anglo American have risen 84 per cent base-to-apex within the past 12 months, a reflection of improved commodity pricing combined with cumulative rationalisation measures.

Earlier this year, it was announced that the miner’s chairman, Sir John Parker, had decided to call it a day after an eight-year tenure in which he oversaw the sale of numerous assets deemed surplus to requirements, the latest of which — an 88.2 per cent interest in the Drayton thermal coal mine in New South Wales — was announced this month.

Not all of the sales met with universal shareholder approval, but no one pretends that it has been plain sailing for Sir John since he came on board, particularly given the weakness in underlying markets through 2014-16.

But prices for speciality metals and bulks, most notably iron ore, strengthened considerably through last year. The consequent rise in cash flows, along with the asset sales, enabled the embattled commodities giant to reduce net debt as a proportion of shareholder funds by around two-fifths since the end of 2015. So he leaves the group, if not in rude health, then certainly in better trim than he probably might have thought possible 18 months ago.

Shares in London Stock Exchange rocketed following the announcement of its proposed merger with Deutsche Börse in February last year. Despite the deal finally falling through this April on competition grounds, very little of these gains have fallen out of the share price. Now chief executive Xavier Rolet has sold shares in the group worth £1.8m.

Even without completing the deal, London Stock Exchange looks in pretty good shape. Income from continuing operations was up almost a fifth during the first four months of the year at £459m; information and post-trade services have led the way in terms of revenue growth.

Global clearing business LCH increased revenue by almost a third during this period, thanks to growth in over-the-counter clearing of derivatives contracts through its SwapClear platform. Meanwhile, demand has remained high for information services, with sales up 9 per cent on a like-for-like basis during the first four months of the year. This is largely due to the popularity of FTSE Russell indices.