Pandemic coronavirus has not had a significant impact on the world’s largest mining companies. According to PwC, total revenue and EBITDA of the 40 largest players in this sector for the year will be reduced by 6%. Companies hand plays even a decline in oil prices, as spending on energy represents a quarter of direct costs. At the same time reducing capital investments leaves companies the opportunity to keep the dividends at about the level of 2019.Pandemic COVID-19 had little impact on the world mining companies, the PWC study seen by Kommersant. If in 2019 the total EBITDA of the 40 largest companies in the industry accounted for $168 billion in 2020, the authors expect a slight decrease of 6%. EBITDA margins will remain at 2019 24%. In evaluating PwC, the total revenue reduced by 6.3%, to $649 billion, and consolidated net profit by 16.4%, to $51 billion Given all this, at PwC, believe that the leading mining companies is quite strong and stable position to cope with the economic uncertainty caused by the COVID-19. The top 40 companies in the sector entered the Russian ALROSA, Norilsk Nickel, Polyus and Polymetal.Reduction of capex allows mining companies to free up cash flow to pay dividends if they deem it appropriate, according to a study by PWC. On hand to mining companies also plays a fall in oil prices that occurred due to the decrease in consumption caused by the pandemic. In a new study by Deloitte on trends in the mining industry (in stock at “b”) indicates that the energy amount to 20-25% of direct costs in the sector.During a pandemic, the capitalization of the 40 global mining companies fell by $146 billion to $752 billion. Despite this, the sector is not expected large transactions due to the high economic uncertainty and practical limits on the visits. In 2019 the total amount of the largest (of more than $1 billion) of mergers and acquisitions in the industry totaled $19.2 billion, most of which were transactions in gold mining. This year the volume of transactions unlikely to reach the same level, but in the current environment for mining companies have the opportunity to benefit from small acquisitions in local markets, the report said PWC.PWC listed Russian companies, the most unstable situation in ALROSA. In terms of coronavirus sales of the company dropped significantly and even by the end of may, when the market improved somewhat, is still seven times lower than last year. The diamond production volume in January—April amounted to 43.1% for the same period of 2019. The Russian government intends to support the holding company experienced in the 2008 crisis way — the purchase of diamonds in Gohran, but the decision�� is still pending. As for “Norilsk Nickel”, the company increasingly can affect not pandemic, and the possible long term damage from the accident at TPP-3 under the Norilsk. Probably these expenses, and possible additional investments in improving the safety of its facilities will affect the amount of dividends.Thus, low diversification of suppliers are faced with the problem when he closed the border. Transition to localization of supply chains and conducting small transactions in local markets may be the long-term consequence of the pandemic, consider in PWC, noting that some companies, such as Anglo American, BHP and Norilsk Nickel is expected to support domestic suppliers and customers.Eugene Zainullin
