| Thu 11 Nov 2010, 8:01 | | ANG - AngloGold Ashanti Limited - Anglogold Ashanti profit more than doubles as |
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ANG - AngloGold Ashanti Limited - Anglogold Ashanti profit more than doubles as
production tops guidance
AngloGold Ashanti Limited
Incorporated in the Republic of South Africa
Registration Number: 1944/017354/06)
ISIN Number:ZAE000043485
JSE Share Code: ANG
("AngloGold Ashanti/Company")
ANGLOGOLD ASHANTI PROFIT MORE THAN DOUBLES AS PRODUCTION TOPS GUIDANCE
(JOHANNESBURG) - AngloGold Ashanti, the gold producer which eliminated the
industry`s largest hedge position during October, more than doubled adjusted
headline earnings* to $303m after production from its mines in South Africa and
Australia increased and gold prices climbed to a record.
"Our operations are performing well and there`s a strong tailwind from the
gold price," Chief Executive Officer Mark Cutifani said. "With the hedge book
out of the way we can now capture the full gold price, which has the potential
to further boost margins and increase cash flow."
Production was 1.162Moz at a total cash cost of $643/oz in the three months
to 30 September, compared with production the previous quarter of 1.13Moz at
$617/oz, and guidance of 1.15Moz at $645/oz. This result was achieved despite
winter power tariff increases and stronger than anticipated currencies in South
Africa, Brazil and Argentina.
The South African operations delivered another outstanding performance with a
7% increase in production to 478,000oz, while total cash costs rose 6% to
$594/oz. Sunrise Dam in Australia posted a 7% growth in production to 93,000oz
and the Geita mine in Tanzania increased output by 3% to 93,000oz, while
reducing costs by 15% to $705/oz.
Adjusted headline earnings* were $303 million or 82 US cents a share in the
third quarter, from $129 million, or 35 US cents a share the previous quarter.
AngloGold Ashanti is saddened and disappointed at the fatal injuries to four
employees during the quarter - three in South Africa and one in Mali. The
company, which has reduced its average fatality rate by 65% since 2007 and
improved overall workplace safety by 45%, is continuing to implement the second
phase of its safety improvement strategy to continue towards its goal of
eliminating all safety incidents.
The company completed an accelerated buy-back of its outstanding hedge
positions on 7 October at a cost of $2.64bn and an average price of $1,300/oz.
The removal of the hedge book allows the company to sell its gold at market
prices, allowing it to better fund the pipeline of organic growth projects which
are expected to add about 1Moz to current production over the next five years,
through total project capital expenditure of about $2.5bn.
AngloGold Ashanti`s board this week approved the development of the 3.3Moz
Tropicana gold project in Australia, a joint venture with Independence Group
which owns a 30% stake. The project (100%), expected to pour its first gold in
2013, will require capital expenditure of $710m to $760m and will have annual
production of 470,000oz to 490,000oz in the first three years.
"Tropicana is the first of AngloGold Ashanti`s major gold discoveries to move
into production," Cutifani said. "It`s gratifying to be developing our own
projects at a time when so many majors are forced to pay huge premiums to fill
their project pipelines."
Fourth-quarter production is anticipated to be 1.14Moz at a total cash cost
of $640/oz, assuming an exchange rate of R7.25 to the dollar and $675/oz
assuming an exchange rate of R6.75 to the dollar.
Following resumption of exploration at the La Colosa deposit in Colombia,
initial drill intercepts have returned encouraging grades, including 74m@ 1.9g/t
and 85m@3.3g/t in `hornfels-style` mineralization in schist material adjacent to
the porphyry deposit. The company will conduct further work to better understand
the significance of the results.
*Excludes cost of accelerated hedge buy back
ENDS
11 November 2010
JSE Sponsor - UBS
Contacts
Tel: E-mail:
Alan Fine (Media) +27 11 637 6383 afine@AngloGoldAshanti.com
Stewart Bailey(Investor) +1 2128364303 sbailey@anglogoldashanti.com
or +27 82 330 9628
Certain statements made in this communication, including, without limitation,
those concerning the economic outlook for the gold mining industry, expectations
regarding gold prices, production, cash costs and other operating results,
growth prospects and outlook of AngloGold Ashanti`s operations, individually or
in the aggregate, including the completion and commencement of commercial
operations of certain of AngloGold Ashanti`s exploration and production
projects, the completion of announced mergers and acquisitions transactions,
AngloGold Ashanti`s liquidity and capital resources, and expenditure and the
outcome and consequences of any litigation proceedings or environmental issues,
contain certain forward-looking statements regarding AngloGold Ashanti`s
operations, economic performance and financial condition. Although AngloGold
Ashanti believes that the expectations reflected in such forward-looking
statements are reasonable, no assurance can be given that such expectations will
prove to have been correct. Accordingly, results could differ materially from
those set out in the forward-looking statements as a result of, among other
factors, changes in economic and market conditions, success of business and
operating initiatives, changes in the regulatory environment and other
government actions including environmental approvals and actions, fluctuations
in gold prices and exchange rates, and business and operational risk management.
For a discussion of certain of these factors, refer to AngloGold Ashanti`s
annual report for the year ended 31 December 2009, which was distributed to
shareholders on 30 March 2010. The company`s annual report on Form 20-F, was
filed with the Securities and Exchange Commission in the United States on April
19, 2010 and as amended on May 18, 2010. AngloGold Ashanti undertakes no
obligation to update publicly or release any revisions to these forward-looking
statements to reflect events or circumstances after today`s date or to reflect
the occurrence of unanticipated events. All subsequent written or oral forward-
looking statements attributable to AngloGold Ashanti or any person acting on its
behalf are qualified by the cautionary statements herein.
AngloGold Ashanti posts information that is important to investors on the main
page of its website at www.anglogoldashanti.com and under the "Investors" tab on
the main page. This information is updated regularly. Investors should visit
this website to obtain important information about AngloGold Ashanti.
Date: 11/11/2010 08:01:00 Produced by the JSE SENS Department.
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