Anglo American to Cut 19,000 Jobs

Updated from 3:24 a.m. EST

LONDON -- Mining company Anglo American PLC (AAUK Quote) plans to cut 19,000 jobs this year and suspend dividend payments after reporting a 29% drop in 2008 profit.

The company said it hoped to cut the jobs -- 10% of its managed work force --through layoffs, natural attrition and scaling back contractor arrangements.

The move comes as market conditions deteriorated dramatically in the second half of 2008, the company said. Of the $5.2 billion it earned in 2008, $4.3 billion came in the first half. In 2007 it earned $7.3 billion.

"The breadth and severity of the global economic downturn and its impact on growth rates in key sectors and economies are difficult to overstate," said CEO Cynthia Carroll.

"From global automotive production to construction activity in emerging markets, there was a marked contrast between the first and second halves of 2008, when commodity prices fell sharply. As we begin 2009, the economic outlook remains weak, with limited visibility and we are continuing to experience volatility and downward pressure on commodity prices," the CEO said.

The company had announced previously that it was slashing capital expenditure this year by more than half to $4.5 billion.

Operating profit in the base metals division -- including copper, nickel and zinc --were down 42% in 2008, the company said. Base metals contributed 45% of Anglo American's operating profit in 2007. Operating profit for platinum declined 17%.

Revenue in 2008 fell 7.6% to $32.9 billion.