RIO Rio Tinto Plc

LONDON—Glencore PLC swung to a net loss of nearly $5 billion last year on tumbling raw-material prices and promised to sell more assets than originally planned this year to further shore up the mining and commodity-trading group's finances.

The Swiss-based company, which reported a net loss of $4.96 billion compared with net profit of $2.3 billion in 2014, said on Tuesday that net debt dropped 15% to $25.9 billion at the end-December compared with a year earlier.

Management is now aiming to sell $4 billion to $5 billion in assets this year, up from a previous target of $3 billion to $4 billion, the company said.

This includes plans to sell a minority stake in its agricultural-products business in the second quarter and expectations it will receive final bids for at least one of two copper mines, Cobar in Australia and Lomas Bayas in Chile.

Glencore said it has set itself a new target for reducing net debt, aiming for $17 billion to $18 billion this year compared with its previous debt goal of $18 billion to $19 billion by the end of 2016.

The world's third-largest diversified miner by market value had announced an accelerated debt-reduction plan as recently as December. Glencore's net debt stood at $29.6 billion at June 30.

The company's shares have rallied 47% since this year's start after raising proceeds from further asset disposals, cutting costs and refinancing a chunk of debt. Glencore's emergency action has reflected similar drastic measures by the world's other big mining groups, including the likes of BHP Billiton PLC, Freeport McMoRan Inc., Rio Tinto PLC, and Vale SA. They have reduced or suspended dividends, scaled back capital spending, and sought buyers for noncore assets as metals and oil prices have collapsed.

Glencore's shares however have more than halved over the past year due to the continued commodities price rout and concerns that the company would struggle to pay down debt.

The company's bottom line took a beating last year from exceptional charges of $6.31 billion, including impairments of $1.42 billion on its New Calendonia Koniambo nickel operations, $1.03 billion on its oil assets in Chad, and a $1.03 billion loss on South Africa's Optimum Coal operations. The business was sold after filing for bankruptcy protection last year.

Excluding the exceptional items, Glencore's underlying net profit fell 69% to $1.34 billion last year, beating analysts' expectations of $743 million according to a FactSet poll of 19 analysts.

Revenue fell 23% to $170 billion on lower commodities prices and cutbacks in the group's copper, nickel and coal output.

Write to Alex MacDonald at alex.macdonald@wsj.com

(END) Dow Jones Newswires

March 01, 2016 03:45 ET (08:45 GMT)

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