Richest Australians see their pickings fall
Published by MAC on 2011-12-12Source: Business Spectator, Herald Sun
And mine safety record shames entire industry.
How the mighty have fallen!
According to a survey last week, billions of dollars have been wiped off the bank accounts of Australia's richest individuals - especially those who profit from the mining industry.
Nonetheless, they're far from being completely down, Down-Under.
Gina Rinehart clings on as Australia's richest woman (and the richest woman in global mining), despite her personal wealth reducing by around A$1.6 billion over the past six months.
Glencore's Ivan Glasenberg still has an A$6.6 billion share of the London-listed giant commodities trader/mining company, although it's fallen in value by over 25% since May.
Australian mining magnates, Andrew Forrest, Clive Palmer and Chris Wallinen, have all seen their fortunes diminish as commodity prices have taken a bear run.
But resist, if you can, shedding any tears for these "A-Little- Bit-Less-Super-Rich".
As the country's Herald Sun newspaper reminds us, "accidental" deaths among Australian mineworkers have actually increased over the past two years.
Now that's an index of real suffering in the industry.
For previous article on MAC: London Calling on Richest Brits (not forgetting their Ozzie counterparts)
Rich Pickings: Tracing Rinehart's commodity rout
By James Thomson
Business Spectator
9 December 2011
Falling iron ore prices have failed to prevent Gina Rinehart from retaining top spot on SmartCompany's special end-of-year rich list.
While the iron ore empress has seen her fortune fall below the magical $10 billion mark, Rinehart remains Australia's richest person, with an estimated fortune of $8.5 billion.
That means her fortune has dropped by around $1.8 billion since the publication of BRW's Rich 200 edition in May, but she isn't the biggest loser for the year.
That title goes to Glencore chief executive Ivan Glasenberg, who has been on an incredible wealth roller-coaster.
He emerged from the float of the commodities trading giant with a fortune of about $9 billion, and was listed on the BRW list with a fortune of $8.8 billion in May. But a 27 per cent fall in the value of Glencore shares has seen the value of his holding fall to $6.6 billion, down a whopping $2.6 billion.
In total, the 15 billionaires at the top of the BRW list have seen their value fall by a total of $7.9 billion, from $67.2 billion on May 26 to $59.3 billion based on current estimates.
That's a fall of 11.8 per cent, which is actually markedly worse than the 8.1 per cent fall in the benchmark ASX 200 index over the same period.
Here's how the end-of-year rich list stands. BRW's Rich 200 valuations from May have been used as a base and have then been adjusted for share price movements. These are estimates only.
1. Gina Rinehart - $8.5 billion
Given Rinehart's fortune is tied to that of her joint venture partner Rio Tinto, so the big miner's share price provides a handy proxy for Rinehart's very private fortune. Recent falls in commodity prices have taken a toll.
2. Ivan Glasenberg - $6.2 billion
The 27 per cent fall in Glencore's share price since listing in May has eaten into its CEO's fortune. As with Rinehart, falling commodity prices have played a big part.
3. Anthony Pratt - $5.4 billion
The Pratt family's interests are diverse, but packaging giant and rival Amcor provides a reasonable proxy. Its shares are up slightly since May and so is Pratt's estimate.
4. Andrew Forrest - $4.7 billion
Twiggy's fortune has followed the iron ore price down, with $1.48 billion of his wealth eroding since the BRW Rich 200.
5. Frank Lowy - $4.7 billon
Frank Lowy's stakes in Westfield's various companies have fallen by about $200 million to just over $2 billion, accounting for the small fall in his wealth.
6. Clive Palmer - $4.6 billion
Getting a line on Palmer's mainly undeveloped coal interests isn't easy. We've used a 9 per cent drop in the price of Queensland coal as a guide, meaning a $450 million fall in his fortune.
7. Harry Triguboff - $4.3 billion
Sydney apartment prices are steady (not bad in the current property market) and so is Harry's fortune.
8. James Packer - $3.9 billion
Moderate falls in the value of shares in Crown and Consolidated Media account for a slight fall in Packer's wealth.
9. John Gandel - $3.5 billion
Property magnate John Gandel has seen his fortune increase slightly along with the value of shares in CFS Retail Trust.
10. Chris Wallin - $2.8 billion
As with Palmer, a 9 per cent fall in the coal price has taken a small chunk off Wallin's fortune.
11. Len Buckeridge - $2.7 billion
The Perth building billionaire's fortune is hard to line up. We've used fellow building company Brickworks as a company and its shares have risen slightly since May.
12. Kerry Stokes - $2.2 billion
About $350 million has been sliced off the fortune of Kerry Stokes, which probably isn't bad given the turmoil in the media sector.
13. David Hains - $2.1 billion
Low-profile investor David Hains is another one that is hard to line up. Given many of his investments are overseas, we've used the MSCI World Index as a proxy. It has fallen about 11 per cent.
14. Kerr Neilsen - $1.9 billion
Platinum Asset Management chief Kerr Neilsen has seen the value of his fortune fall slightly, in line with a moderate share price fall.
15. Angela Bennett & Michael Wright - $1.8 billion
As with Rinehart, Rio Tinto provides the best proxy for the wealth of this brother and sister combination.
Worker deaths haunt our big miners
The mining boom is making a handful of Australians fabulously wealthy.
But too many workers are being killed in the process.
By Alan Howe
Herald Sun (Australia)
5 December 2011
IT is a two-speed economy, we are told.
There are the miners - open-cut hares - making fortunes daily as China and India build their futures using Australian iron ore and coal.
Then there are the rest of us, mostly a burden apparently, moving tortoise-like towards uncertain futures and, as we discovered at the weekend, negotiating hardship packages with the banks to avoid defaulting on our mortgages.
Australia used to ride on the sheep's back; now it's ships we depend on, moving hundreds of thousands of tonnes of our country northwards every day.
It is surely an irony then that the mining industry's public face, the Minerals Council of Australia, the shopfront for the richest and fastest growing industry in the land, including, of course, the biggest Australian, BHP, is our slowest Australian.
It has not always been that way. It got to its feet quick smart last year when Kevin Rudd's proposed Mining Super Profits Tax threatened to spread their wealth around.
Minerals Council front man Mitch Hooke became a household name as a deceptive multi-million dollar television, radio and newspaper campaign against the tax explained to us all that our superannuation was imperilled because Rudd's tax would slice the nation off at its knees.
In fact, the big miners' share prices were going through the roof. The Minerals Council chose not to advertise that.
The tax was announced on May 2 last year. Just 53 days - and more than $17 million later - the Minerals Council had their man. Rudd was deposed and the super profits tax plan axed.
Phew. That wasn't even close.
Of course, $17 million to these players is pin money.
Andrew Forrest's Fortescue Metals Group announced profits up 76 per cent this year to more than $1 billion, and he insists he's a small miner. In a way he is.
Rio Tinto's first-half profits were at a record $7.8 billion. Xstrata clocked in with half-yearly operating profits up 31 per cent to $4.25 billion.
BHP Billiton achieved an Australian record profit this year, but next year it expects to do better and report a $24 billion result.
The smaller boys, the so-called mid-tier miners, saw combined profits soar from $38 million last year to $2.4 billion.
It might be dust, danger, noise and grime at the coalface, but the gilded celebrities of mining do rather well: BRW's rich list has Lang Hancock's daughter Gina Rinehart as the wealthiest Australian with $10.31 billion; Twiggy Forrest comes in third with $6.18 billion; Clive Palmer is fifth with more than $5 billion; but poor and not so old Chris Wallin, a former public servant who now controls QCoal, can manage only double figures - he's the 10th richest Australian with just $3.1 billion.
The miners, and the organisation that represents many of them, the Minerals Council, makes quite a song and dance about their noble commitment to the safety of the Australian men and women who work at our mines.
The council's website states boldly that "in recognition of the fact that no minerals fatality, injury or disease is acceptable, the Minerals Council decided in 1996 to take a leadership role on safety and health".
That sounds like excellent news. And there's more: "The council made safety and health its top priority, agreed on a statement of vision and beliefs, safety awareness definition and established the Safety and Health Committee."
Its vision is of a minerals industry "free of fatalities, injuries and diseases".
But the safety of the industry's employees has long been a problem. Ian Ashby would know. He is the president of the iron ore division of BHP and he has been reported as saying his company's safety performance was "abysmal", while warning of widespread complacency among miners.
The Minerals Council's website does not report Ashby's comments. But that might be because they are too recent. Ashby only said that a couple of years ago after his company had experienced five deaths in nine months.
While the slowest Australian - almost certainly the best-funded and most powerful industry group in the land - is keen to talk up safety, the most recent figures on its otherwise comprehensive website covering injuries and fatalities at mines date back to 2007-2008.
I wonder why that is so.
Here might be a clue: That was the best year on record for Australian mining. Just four employees were killed. Fourteen had been killed the year before.
Surely that's good news. Perhaps. The bad news is that the following year deaths at Australian mines quadrupled.
But those humiliating and deeply disturbing statistics, years after they were compiled, are yet to make it to the Minerals Council website. Funny that.
According to Safe Work Australia there were another eight deaths at mines in the last financial year, including the Christmas Eve death of a contract worker at Fortescue's Cloudbreak mine in the Pilbara.
And the new financial year got off to a bad start with the death of Brent Glew, 27, a Rio Tinto employee.
Weeks before, Sean McBride, a 28-year-old Irishman, was killed at a Rio site.
Days later, just-married Jordan Marriott-Statham was killed working for BHP.
But you'll be hard-pressed to find these figures on the Minerals Council website. Its health and safety stats are about four years out of date, notwithstanding that it carries press releases there from a just a few days ago.
Might these important announcements concern mine safety or the deaths of miners' employees and contractors?
Or what the Minerals Council's wealthy members plan to do to reduce deaths and injuries at Australia's mine sites?
No, the most recent posting is a whinge about Victorian mining companies being "still mired in red tape".
It was another miner, the late businessman Tiny Rowland, who was described by Conservative British Prime Minister Edward Heath as "the unpleasant and unacceptable face of capitalism".
Perhaps that title now goes to the Minerals Council of Australia.