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[VIDEO] PwC's 2015 mine report: The Gloves Are Off

The title of PwCs latest report -- The Gloves Are Off – is a reflection of the current state of the mining industry where the fight for value and ...

Admin
|Jul 6|magazine6 min read

The title of PwC’s latest report -- The Gloves Are Off – is a reflection of the current state of the mining industry where the fight for value and free cash flow has descended into an all-out brawl.

“The general outlook for the global metals and mining market remains subdued due to the combination of a slower rate of global economic growth, particularly in emerging markets, and signs of an oversupply of several commodities, most notably iron ore and coal,” said the report.

• Related content: Fading away: South Africa's mining industry falls out of top 40 mining list

“Lower crude oil prices and a stronger US dollar are proving beneficial for miners by helping to lower operating costs. The uneven global economic recovery and divergent monetary policies continue to create uncertainty around medium-term supply and demand across the mining industry.”

In this short video, PwC's WA Mining Partners discuss the issues raised in the Mine report in an Australian context including the deals environment, tax transparency and the outlook for our local industry.

The 12th annual report, which reviews the top trends in the global mining industry, includes a detailed financial analysis of the Top 40 mining companies globally by market capitalization. According to the report, the top 40 senior producers lost $156 billion during 2014 while the pace of mergers and acquisitions (M&A) came to a screeching halt. Key findings in the report include:

• Overall market values plummet $156 billion in 2014

• Free cash flow increased to $24 billion; but net profit down 9 percent

• Government intervention, shareholder activism, internal industry conflict on the rise

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