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Anglo American (OTCQX:AAUKF) (OTCQX:NGLOY) is downgraded Thursday at RBC Capital to Sector Perform from Outperform, saying the fire incident at the Grosvenor coal mine in Australia likely will hurt earnings and delay the sale of its coal division, removing one of its key near-term catalysts from its investment case.
RBC said it expects a 12-month stoppage at the Grosvenor mine and $500M repair cost, and believes potential buyers of Anglo’s (OTCQX:AAUKF) (OTCQX:NGLOY) coal business will wait for more clarity on the incident or a discounted premium.
With the steelmaking coal mine likely offline for much of 2025, the bank lowered its production forecast to 13.8M metric tons compared to prior guidance of 17M-19M tons.
“We see [Anglo’s] outlook more balanced in the near term as the sale of the met coal division gets more complicated,” RBC analysts wrote in the downgrade, adding that since it is the second major incident at Grosvenor since it started operations in 2015-16, it could cause an additional headwind to achieving a full price.
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