London - Commodities group Glencore Xstrata expects at least $2-billion of synergies for next year, beating initial guidance of $500-million at the time of the takeover of miner Xstrata, and hinting at further savings ahead.
“A significant portion of the synergies are in overhead costs at head and regional offices. We are only just starting to comprehensively look at the combined mining and metallurgical operations,” Glencore Xstrata Chief Executive Ivan Glasenberg said in a statement on Tuesday.
Glencore Xstrata said it would reduce capital expenditure by $3.5-billion by 2015 and hold spending to sustain operations at the lower end of previous guidance.
Greenfield projects inherited from Xstrata - mines to be built from scratch, long unpopular with Glencore - have been “deprioritised” with both scope and cost being brought down.
Glencore is due to hold a day of investor presentations on Tuesday, beginning at 07h15 GMT. - Reuters