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London - Anglo American's new boss will lay out his stall on Friday after four months in the job and while investors are not counting on a quick fix, they are betting his plans will include cost cuts, more disciplined spending and potential asset sales.
Anglo, the smallest of the major diversified miners, has underperformed its peers, most recently battling labour unrest in South Africa, where it generates half its earnings, and multi-billion dollar cost overruns in Brazil.
Investors piling into BHP Billiton, Rio Tinto and Anglo in 2006 would have made more than one and a half times their money at BHP and seen returns of 65% at Rio. But they would have lost money at Anglo - a negative total return of around 16%, according to Reuters data.
Anglo posted its first loss in a decade in 2012, a year of hefty writedowns and CEO departures across the industry. According to Citi, last year Anglo's return on equity, a measure of profitability, hit its lowest level since the 1930s.
So while the market may not be preparing for what some analysts called a "big bang" menu of asset splits or a radical and frequently debated platinum spin-off - all are demanding change from boss Mark Cutifani, an Australian former miner and engineer who joined from bullion producer AngloGold.
"People talk about Anglo pulling a rabbit out of a hat and I wonder if that is overly optimistic given the challenges (Anglo) faces. Even if Mr Cutifani can make progress it will take time," said analyst Chris LaFemina at Jefferies.
Some problems date back years, including those at its Anglo American Platinum (Amplats) arm which sank to a loss last year after a wave of violent strikes in South Africa. The miner is now pushing through production and job cuts.
Amplats is seen as pivotal to Anglo's recovery: it contributed $92m to Anglo's underlying earnings in the first half, compared to $850m in the first half of 2008.
But also vying for the top of Cutifani's to-do list will be Anglo's $8.8bn Brazilian iron ore project, Minas Rio, dogged by cost overruns and delays.
"(Cutifani) will focus on where Anglo has been weak - project delivery, capital discipline, cost control, productivity - setting out his stall for the sort of thing he thinks Anglo ought to be able to do," said analyst Des Kilalea at RBC Capital Markets in London.
"(Former CEO) Cynthia Carroll did quite a lot, but Anglo has been a work in progress for about 10 years. It has never really broken free from the mistakes it made historically."
Anglo, compelled to reinvest in South Africa during the Apartheid era because of exchange controls, was once a sprawling conglomerate whose assets spanned gold, diamond and other mines, as well as paper mills, steel, banking and real estate.
To-do
Analysts who have long berated the company for poor spending decisions, have said they expect clarity on cost savings.
At Anglo's annual shareholder meeting in April, Cutifani attributed industry woes to a "lack of capital discipline, a lack of focus on returns and incapacity to translate good intent into business results".
Anglo currently spends around $900m a year developing long-dated projects like the Pebble copper deposit in Alaska, according to an example provided by Cutifani and cited by analysts, who say that level of spending on projects that may not see the light of day is unsustainable.
Morgan Stanley estimates lower spending here and overhead cuts could deliver at least $500m of annual savings.
That could help protect Anglo's dividend, as would balance sheet-boosting divestments and stake sales.
Across the sector, miners have been putting assets up for sale to focus on core operations, and Cutifani is set to highlight potential divestments, partial and whole, though detailed timeframes and targets are not expected.
Anglo said in February it could consider a sale of a stake in Minas Rio, and could add to that.
Credit Suisse analysts estimate $3-$6bn of asset and stake sales, including shares of Minas Rio, Australian coal projects and a 40% holding in Samancor, the world's largest produer of seaborne manganese ore.
They also pointed to further, less likely options that could bump up proceeds to more than $11bn - including a share in diamond arm De Beers, which Anglo took control of in 2012.
Cutifani, an enthusiast for technology, is expected to push softer points like technological innovation at Anglo, along with better marketing and operational improvements.
Management changes are seen as a given, though they could follow over the coming months as Cutifani cements his power base. Inspiring investors, may take longer.
"My view on Anglo is that it is too late to change the long term direction of the group," said one top 20 investor. "A decade ago, (Cutifani) could have made a big difference."
