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AGL
ANAAL
AGL - Anglo American plc - Half year financial report for the six months ended
30 June 2011
Anglo American plc
Incorporated in the United Kingdom
(Registration number: 3564138)
Short name: Anglo
Share code: AGL
ISIN number: GB00B1XZS820
HALF YEAR FINANCIAL REPORT for the six months ended 30 June 2011
Anglo American announces 45% increase in half year core operating profit to
$5.9 billion
Financial highlights for the six months ended 30 June 2011
- Group operating profit(1) of $6.0 billion ($5.9 billion from core
operations(2), up 45%)
- Underlying earnings(3) of $3.1 billion and underlying EPS of $2.58, up 40%
- Profit attributable to equity shareholders(4) of $4.0 billion, up 93%
- Net debt(5) of $6.8 billion at 30 June 2011
Operational performance and strategic delivery
- Kumba sales levels maintained to take advantage of record export iron ore
prices, despite Q1 rains
- Metallurgical Coal production recovered strongly from severe flooding to
benefit from record pricing, while export Thermal Coal production increased by
5% in South Africa
- Nickel production enhanced by successful delivery of Barro Alto project
- Platinum refined production increased 17% to 1.2 million ounces
- $1.3 billion of benefit from asset optimisation and supply chain, having
already exceeded $2 billion target in 2010
- Divestment programme of non-core businesses largely complete
- $3.3 billion of cumulative announced proceeds(6)
- Tarmac and Lafarge UK joint venture progressing through regulatory process
Production growth already being delivered
- Barro Alto 41 ktpa(7) nickel project - delivered on schedule; ramp-up under
way
- Los Bronces 278 ktpa(8) copper expansion - on schedule for Q4 2011
- Kolomela 9 Mtpa iron ore project - 94% complete and on schedule to produce 4-
5 Mt in 2012; hot commissioning to take place during H2 2011
- Minas-Rio 26.5 Mtpa iron ore project - on track for first ore on ship in H2
2013
- $66 billion of unapproved projects across core commodities provides growth
optionality for the long term
Safety
- Continued drive towards zero harm to address disappointing safety
performance
- Ten lives lost in first six months
Dividend
- Interim dividend increased by 12% to $0.28 per share
HIGHLIGHTS
6 months 6 months
ended ended
30 June 2011 30 June 2010 Change
US$ million, except per share amounts
Group revenue including associates (9) 18,294 15,015 22%
Operating profit including associates
before special items and remeasurements
- core operations (1)(2) 5,923 4,071 45%
Operating profit including associates
before special items and remeasurements (1) 6,024 4,361 38%
Underlying earnings (3) 3,120 2,212 41%
EBITDA (10) 7,112 5,414 31%
Net cash inflows from operating activities 3,986 2,686 48%
Profit before tax (4) 6,571 3,903 68%
Profit for the financial period
attributable to equity shareholders (4) 3,988 2,061 93%
Earnings per share (US$):
Basic earnings per share (4) 3.30 1.71 93%
Underlying earnings per share (3) 2.58 1.84 40%
Dividend per share 0.28 0.25 12%
(1) Operating profit includes attributable share of associates` operating
profit (before attributable share of associates` interest, tax and non-
controlling interests) and is before special items and remeasurements, unless
otherwise stated. See notes 2 and 3 to the Condensed financial statements. For
the definition of special items and remeasurements see note 4 to the Condensed
financial statements.
(2) Operations considered core to the Group are Iron Ore and Manganese (Kumba
Iron Ore, Iron Ore Brazil and Samancor), Metallurgical Coal, Thermal Coal,
Copper, Nickel, Platinum, Diamonds, Exploration and Corporate Activities. See
the Financial review of Group results section for a reconciliation of
operating profit from core operations to Group operating profit.
(3) See note 9 to the Condensed financial statements for basis of calculation
of underlying earnings.
(4) Stated after special items and remeasurements.
(5) Net debt includes related hedges and net debt in disposals groups. See
note 12 to the Condensed financial statements.
(6) Consideration on a debt and cash free basis, as announced.
(7) Additional capacity over first five years.
(8) Additional capacity over first three years.
(9) Includes the Group`s attributable share of associates` revenue of $3,057
million (six months ended 30 June 2010: $2,425 million). See note 2 to the
Condensed financial statements.
(10) Earnings before interest, tax, depreciation and amortisation (EBITDA) is
operating profit before special items, remeasurements, depreciation and
amortisation in subsidiaries and joint ventures and includes the attributable
share of EBITDA of associates. See note 5 to the Condensed financial
statements.
Cynthia Carroll, Chief Executive, said: "Anglo American`s strong financial
performance in the first half is reflective of the operational and business
improvement foundations put in place over the last three years which have
enabled us to capture the maximum benefit of increased commodity prices.
Furthermore, our commitment to sustain investment in our growth projects
through the downturn is now paying dividends; that new production is already
coming on stream and will drive very substantial incremental cash flows as the
projects ramp up from this year onwards. For the first six months, we have
reported a 45% increase in operating profit from our core businesses,
generating $5.9 billion, with EBITDA of $7.1 billion, and underlying earnings
of $3.1 billion. All of our core segments reported an increase in operating
profit.
We have achieved asset optimisation and procurement benefits of $1.3 billion
from our core businesses during the first six months of the year, having
already exceeded our full year 2011 target of $2 billion of benefits during
2010. As we have seen across many major mining regions, there were also a
number of factors that negatively affected performance, including weather
conditions in Australia and South Africa, further dollar weakness, input cost
pressures and lower ore grades. However, I am pleased to report that where we
are able to mitigate against these factors, we have done so and we expect a
stronger second half to the year to build upon the momentum of the second
quarter. Our post-flood production recovery plan for our Metallurgical Coal
business in Australia and the firmly embedded practices of our global supply
chain have shown particular success, to name just two examples.
Anglo American`s delivery of substantial near term production growth in
nickel, copper and iron ore at attractive cash cost positions, clearly sets us
apart. We are now in a position to take full advantage of the robust demand
environment as we deliver some of the lowest capital intensity and operating
cost volumes to fundamentally attractive markets. Our four major projects have
all made excellent progress, Barro Alto began production on schedule in March
and will more than double our Nickel business` production when it reaches full
capacity in 2012. In the fourth quarter of this year, the expansion of our Los
Bronces copper operation will begin production on schedule, more than doubling
the mine`s production over the first three years to 490,000 tonnes per year
and will have highly attractive cash operating costs.
Looking to the first half of next year, 2012, the 9 million tonnes per year
Kolomela iron ore project in South Africa will ramp-up production, again with
a very competitive cost position. The development progress of Kolomela has
been outstanding, it is 94% complete and certain elements of the plant are
already being handed over for commissioning. We have also extended the life of
the mine by eight years, now giving us a 28-year life of mine. In Brazil, our
26.5 million tonnes per year Minas-Rio iron ore project continues to make good
progress, with civil works for the beneficiation plant and construction works
for the tailings dam all getting under way since March. The project is on
track to deliver first ore on ship in the second half of 2013 at a first
quartile cost position and we have begun the pre-feasibility work for the
project`s very significant expansion potential to 80-90 million tonnes per
year.
Looking further out, our $66 billion pipeline of unapproved projects presents
tremendous opportunities and optionality from our world class resource base,
which itself has been significantly increased due to our many exploration
successes. However, while we expect to approve a number of major projects over
the next 12 months, including Quellaveco (copper) and Grosvenor (metallurgical
coal), we are not immune from the industry-wide challenges in delivering new
supply to the market.
I have always made it clear that safety is my absolute priority and I am
saddened by the disappointing safety performance in the first half of this
year, following five years of consistent safety improvement. Ten employees
lost their lives in work related incidents and there is another such incident
under investigation. Furthermore, our lost time injury rates have plateaued
following a long period of significant and sustained improvements. While
there are a great many examples of continued safety excellence across our
businesses, most notably in Copper, we have taken swift action to review,
refocus and reprioritise our safety related initiatives to ensure we continue
to move towards zero harm.
The economic outlook remains robust for the mining industry and in particular
for Anglo American`s well balanced and diversified portfolio. While there
undoubtedly remain a number of headwinds affecting the global economy in the
near term, the long term healthy demand growth from the major emerging
economies, together with widespread supply constraints, continues to support
highly attractive market dynamics."
Review of the six months ended 30 June 2011
Financial results
Anglo American`s underlying earnings for the first half of 2011 were $3.1
billion, 41% higher than the same period in 2010, with an operating profit of
$6.0 billion, up 38% from $4.4 billion. Robust demand and disruption to supply
resulted in higher prices across the Group`s portfolio of commodities. Copper
reached a nominal record of 460 c/lb during February, while the iron ore
market saw record quarterly contract and index prices. A record metallurgical
coal price settlement was concluded for the second quarter at $330/t for high
quality hard coking coal, reflecting reduced availability of supply. Export
thermal prices also increased significantly, with export prices FOB South
Africa up 39% compared with the first half of 2010.
Iron Ore and Manganese recorded an operating profit of $2,507 million, 54%
higher than the corresponding period in 2010. This was supported by strong
iron ore prices, which increased by 56% at Kumba Iron Ore (Kumba), offsetting
the impact of higher costs as a result of increased waste removal activity,
the stronger rand, and lower operating profits from the Manganese operations.
Kumba generated an operating profit of $2,437 million, 66% higher than in the
same period during 2010.
Metallurgical Coal delivered an operating profit of $491 million, an 87%
increase on the first half of 2010, primarily due to the impact of higher
realised export prices driven by weather induced supply constraints,
offsetting the impact of a 22% decrease in export metallurgical sales and a
stronger Australian dollar. Recovery actions initiated in the first quarter
resulted
in export metallurgical coal sales increasing by 79% in the second quarter
compared to the first quarter.
Thermal Coal`s operating profit of $521 million was 48% higher than the
equivalent period in 2010 as a result of stronger realised prices more than
offsetting the impact of lower railings to the Richards Bay Coal Terminal
following derailments in the first quarter, and an extended maintenance
shutdown between May and June. Cerrejon provided a strong financial
performance, driven by higher export prices into the Atlantic markets.
Copper delivered an operating profit of $1,401 million, 18% higher than the
first half of 2010, underpinned by a record average realised copper price.
Sales volumes were 12% lower than the same period in 2010 owing to lower
production as a result of anticipated lower grades and rain disruption, and
the impact of the Patache port closure throughout the first half of the year.
Nickel reported an operating profit of $93 million, 37% higher than the
equivalent period in 2010, principally as a result of a 21% increase in sales
volumes from Codemin and Loma de Niquel and a higher nickel price.
Platinum generated an operating profit of $542 million, 30% higher than the
corresponding period in 2010, driven by a 13% increase in sales volume and a
15% increase in the overall average realised basket price.
Diamonds recorded an attributable operating profit of $450 million, 72% higher
than the first half of 2010, reflecting record rough diamond prices with
production in line with the first half of 2010.
Other Mining and Industrial`s operating profit was $101 million, 65% lower,
attributable to the sale of Scaw International, the Skorpion Zinc mine and
Tarmac European businesses in 2010, and the Lisheen and Black Mountain Zinc
operations in 2011. The businesses that Anglo American has decided to retain
(Peace River Coal, Copebras and Catalao), delivered a 118% increase in
operating profit, driven by higher demand and prices for fertiliser products,
and higher metallurgical coal prices and sales volumes. This was offset by
Tarmac`s operating loss of $22 million, compared to an operating profit of $29
million in the first half of 2010, following rising input costs and difficult
market conditions as well as the sale of its European businesses. Operating
profit in the Scaw South Africa business was 15% lower due to difficult
trading conditions in the Rolled Products operation.
Production
Production across the Group`s operations was negatively affected by
significant increases in rainfall relative to the same period in 2010. At
Kumba`s Sishen mine in South Africa, production from the Dense Medium
Separation plant was down 16%, driven by the impact of feedstock availability
constraints owing to rain restricting activity in the pit and wet feedstock
causing blockages in the plant. Jig plant production was 2% lower than the
first half of 2010, but the plant achieved a run rate in excess of design
capacity during the second quarter, which offset the shortfall of the first
quarter. Kumba`s Sishen Mine saw an 18% increase in production during the
second quarter of 2011 as operations recovered from the rain-disrupted first
quarter. In Australia, the Group`s Metallurgical Coal operations were affected
by the widespread flooding. Metallurgical coal production was down 19% versus
the first half of 2010, but in the second quarter increased by 77% against the
first quarter.
Production of export thermal coal from South Africa increased by 5%, driven by
the ramp up at Zibulo. The first half production for both Cerrejon and
Australian thermal coal has been reduced by heavy rainfall, with production
down by 3% and 17% respectively. Copper production was 8% lower than the first
half of 2010 owing to the impact of heavy rains at Collahuasi, lower grades, a
temporary failure in the return solutions pipeline at Los Bronces, and lower
throughput and recoveries at El Soldado. Nickel production from the Nickel
Business Unit in South America was 26% higher than the same period in 2010,
driven by higher production at Loma de Niquel and delivery of the Barro Alto
project, while nickel output from Platinum`s South African mines increased by
12%.
Equivalent refined platinum production decreased by 3% from first half of
2010, as a result of safety related stoppages, both regulated and self-
imposed. Platinum refined production was 17% higher than the first half of
2010.
Production at De Beers was in line with the first half of 2010.
Capital structure
Net debt, including related hedges, of $6,794 million was $590 million lower
than at 31 December 2010, and $4,136 million lower than at 30 June 2010.
Cash flows from operations of $5,233 million funded capital investment of
$2,328 million (net of related derivatives) principally in the Group`s core
assets, including combined investment of $1,083 million in the Los Bronces,
Barro Alto, Minas-Rio and Kolomela growth projects during the first six months
of the year. The disposal of the remaining Zinc businesses in February 2011
resulted in a net cash inflow of $499 million.
Dividends
An interim dividend of 28 US cents per share has been declared.
Significant project growth already being delivered
Anglo American has a clear strategy of deploying its capital in those
commodities with strong fundamentals and the most attractive risk-return
profiles that deliver long term, through-the-cycle returns for its
shareholders.
Anglo American has developed a portfolio of world class operating assets and
development projects with the benefits of scale, expansion potential and
attractive cost position.
The Group`s pipeline of projects spans its core commodities and is expected to
deliver organic production growth of 35% by 2014 from approved projects alone.
Beyond the near term, Anglo American has a world class pipeline of projects
across its selected commodities and is progressing towards approval decisions
in relation to the development of two further high quality growth projects -
the 225 ktpa Quellaveco copper project in Peru and the 4.3 Mtpa Grosvenor
metallurgical coal project in Australia. Submission to the Board for approval
is expected for the Quellaveco project once the necessary water permits have
been obtained and for the Grosvenor project in 2012. Together with a number of
other medium and longer term projects, Anglo American has the potential to
double production over the next decade through its $85 billion pipeline of
more than 100 projects.
Anglo American`s project management systems and processes ensure close
collaboration between the Group`s technical and project teams to execute
projects effectively. The four largest near term strategic growth projects are
all well placed on their respective industry cost curves, have long resource
lives and the first of those projects has already entered production.
Barro Alto - delivered
The Barro Alto nickel project in Brazil, a greenfield nickel project approved
for development in December 2006, delivered its first metal in March 2011.
Barro Alto is ramping up towards full production capacity, which it is
expected to reach in the second half of 2012. This project makes use of a
proven technology and will produce an average of 36 ktpa of nickel in full
production (41 ktpa over the first five years), more than doubling production
from Anglo American`s Nickel business, with a competitive cost position in the
lower half of the cost curve.
Los Bronces - on track
The Los Bronces copper expansion project in Chile is 97% complete and is on
schedule for first production in the fourth quarter of 2011. Production at Los
Bronces is scheduled to more than double (increase by 278 ktpa) to 490 ktpa
over the first three years of full production following project completion and
to average 400 ktpa over the first 10 years. At peak production levels, Los
Bronces is expected to be the fifth largest producing copper mine in the
world, with highly attractive cash operating costs, reserves and resources
that support a mine life of over 30 years and with further expansion
potential.
Kolomela - on track
Kumba`s Kolomela project in South Africa is well advanced and overall project
progress reached 94% by 30 June 2011. With construction substantially
complete, various systems of the plant have been handed over for cold
commissioning. Hot commissioning of the plant is anticipated to commence
during the third quarter of 2011. During the process, ore will be fed through
the plant, resulting in work in progress stock and some saleable product being
produced in 2011. Significant progress has been made by Transnet, with the
construction of the direct rail link from the mine to the Sishen-Saldahna iron
ore export channel likely to be finalised by the fourth quarter of 2011.
Kolomela is situated 80 km to the south of Kumba`s world class Sishen mine
and, when full production is achieved in 2013, will produce 9 Mtpa of high
quality seaborne iron ore, with further potential for expansion. Kolomela`s
life of mine has been extended by eight years to 28 years since the initial
investment decision was made in 2008.
Minas-Rio - on track
The Minas-Rio iron ore project in Brazil continues to make progress and is
expected to produce 26.5 Mtpa of iron ore in its first phase. The award of the
second part of the mine, beneficiation plant and tailings dam installation
licence (LI part 2) in December 2010, being the primary installation licence,
enabled the start of the civil works for the beneficiation plant and tailings
dam construction in March 2011, after the rainy season. This licence followed
the award of the mining permit in August 2010. During the first half of 2011,
licence and permit receipts continued, including securing the Mineral Easement
and progressing land access, though there are still a number of other licenses
and permits to be secured. At the beneficiation plant, 73% of earthworks are
complete and 15% of the civil works have been concluded. The project remains
on track to deliver first ore on ship during the second half of 2013.
Divestment programme largely complete
Anglo American`s programme to divest of its non-core businesses is largely
complete. Scaw South Africa, the remaining extent of the Scaw Metals Group, is
the last such business to be sold and that sales process is under way. During
2010, Anglo American announced the sale of a number of businesses for a total
consideration of $3.3 billion on a debt and cash free basis, completed in a
manner and on a timetable to maximise value to Anglo American`s shareholders.
On 18 February 2011, Anglo American and Lafarge announced their agreement to
combine their cement, aggregates, ready-mixed concrete, asphalt and
contracting businesses in the United Kingdom; Tarmac, Lafarge Cement UK,
Lafarge Aggregates and Concrete UK. The 50:50 joint venture will create a
leading UK construction materials company, with a portfolio of high quality
assets drawing on the complementary geographical distribution of operations
and assets, the skills of two experienced management teams and a portfolio of
well-known and innovative brands. This transaction is progressing through the
regulatory clearance processes.
As part of Anglo American`s strategy to grow its Metallurgical Coal business,
Anglo American has decided to retain, invest in and grow the Peace River Coal
asset in British Columbia. Peace River Coal will be managed as part of Anglo
American`s Metallurgical Coal business.
Anglo American has decided to retain its Copebras phosphates business in
Brazil and will further assess its potential for additional investment.
Outlook
Anglo American believes that demand for commodities remains healthy, driven by
the resources intensive growth in the emerging economies, particularly in
China and India. However, the unfolding of sovereign debt crises in Europe and
the United States, and policy tightening in the major emerging economies is
expected to generate short-term volatility. In spite of that volatility,
prices for commodities are expected to be robust as widespread supply
constraints and the challenges producers face in bringing new supply into
production will lead to tighter market fundamentals.
Costs will continue to be impacted by strong producer currencies and
increasing prices for key inputs.
For further information, please contact:
Media Investors
UK UK
James Wyatt-Tilby Leng Lau
Tel: +44 (0)20 7968 8759 Tel: +44 (0)20 7968 8540
Emily Blyth Caroline Metcalfe
Tel: +44 (0)20 7968 8481 Tel: +44 (0)20 7968 2192
South Africa Leisha Wemyss
Pranill Ramchander Tel: +44 (0)20 7968 8607
Tel: +27 (0)11 638 2592
Anglo American plc is one of the world`s largest mining companies, is
headquartered in the UK and listed on the London and Johannesburg stock
exchanges. Anglo American`s portfolio of mining businesses spans precious
metals and minerals - in which it is a global leader in both platinum and
diamonds; base metals - copper and nickel; and bulk commodities - iron ore,
metallurgical coal and thermal coal. Anglo American is committed to the
highest standards of safety and responsibility across all its businesses and
geographies and to making a sustainable difference in the development of the
communities around its operations. The company`s mining operations and
extensive pipeline of growth projects are located in southern Africa, South
America, Australia, North America and Asia.
Webcast of presentation:
A live webcast of the results presentation, starting at 9.00am UK time on 29
July, can be accessed through the Anglo American website at
www.angloamerican.com.
Note: Throughout this results announcement, `$` denotes United States dollars
and `cents` refers to United States cents; operating profit includes
attributable share of associates` operating profit and is before special items
and remeasurements, unless otherwise stated; special items and remeasurements
are defined in note 4 to the Condensed financial statements. Underlying
earnings unless otherwise stated are calculated as set out in note 9 to the
Condensed financial statements. Earnings before interest, tax, depreciation
and amortisation (EBITDA) is operating profit before special items and
remeasurements, depreciation and amortisation in subsidiaries and joint
ventures and includes attributable share of EBITDA of associates. EBITDA is
reconciled to `Total profit from operations and associates` and to `Cash
flows from operations` in note 5 to the Condensed financial statements.
Tonnes are metric tons, `Mt` denotes million tonnes and `kt` denotes thousand
tonnes unless otherwise stated.
Forward-looking statements
This announcement includes forward-looking statements. All statements other
than statements of historical facts included in this announcement, including,
without limitation, those regarding Anglo American`s financial position,
business and acquisition strategy, plans and objectives of management for
future operations (including development plans and objectives relating to
Anglo American`s products, production forecasts and reserve and resource
positions), are forward-looking statements. Such forward-looking statements
involve known and unknown risks, uncertainties and other factors which may
cause the actual results, performance or achievements of Anglo American, or
industry results, to be materially different from any future results,
performance or achievements expressed or implied by such forward-looking
statements.
Such forward-looking statements are based on numerous assumptions regarding
Anglo American`s present and future business strategies and the environment in
which Anglo American will operate in the future. Important factors that could
cause Anglo American`s actual results, performance or achievements to differ
materially from those in the forward-looking statements include, among others,
levels of actual production during any period, levels of global demand and
commodity market prices, mineral resource exploration and development
capabilities, recovery rates and other operational capabilities, the
availability of mining and processing equipment, the ability to produce and
transport products profitably, the impact of foreign currency exchange rates
on market prices and operating costs, the availability of sufficient credit,
the effects of inflation, political uncertainty and economic conditions in
relevant areas of the world, the actions of competitors, activities by
governmental authorities such as changes in taxation or safety, health,
environmental or other types of regulation in the countries where Anglo
American operates, conflicts over land and resource ownership rights and such
other risk factors identified in Anglo American`s most recent Annual Report.
Forward-looking statements should, therefore, be construed in light of such
risk factors and undue reliance should not be placed on forward-looking
statements. These forward-looking statements speak only as of the date of this
announcement. Anglo American expressly disclaims any obligation or undertaking
(except as required by applicable law, the City Code on Takeovers and Mergers
(the "Takeover Code"), the UK Listing Rules, the Disclosure and Transparency
Rules of the Financial Services Authority, the Listings Requirements of the
securities exchange of the JSE Limited in South Africa, the SWX Swiss
Exchange, the Botswana Stock Exchange and the Namibian Stock Exchange and any
other applicable regulations) to release publicly any updates or revisions to
any forward-looking statement contained herein to reflect any change in Anglo
American`s expectations with regard thereto or any change in events,
conditions or circumstances on which any such statement is based.
Nothing in this announcement should be interpreted to mean that future
earnings per share of Anglo American will necessarily match or exceed its
historical published earnings per share.
Certain statistical and other information about Anglo American included in
this announcement is sourced from publicly available third party sources. As
such it presents the views of those third parties, but may not necessarily
correspond to the views held by Anglo American.
Financial review of Group results
Group operating profit for the first half of 2011 was $6,024 million, with
operating profit from core operations of $5,923 million, 45% higher than the
first half of 2010.
6 months 6 months
Operating profit ended ended
$ million 30 June 2011 30 June 2010
Iron Ore and Manganese 2,507 1,628
Metallurgical Coal 491 263
Thermal Coal 521 351
Copper 1,401 1,185
Nickel 93 68
Platinum 542 418
Diamonds 450 261
Exploration (46) (57)
Corporate Activities and Unallocated costs (36) (46)
Operating profit including associates before
special items and
remeasurements - core operations 5,923 4,071
Other Mining and Industrial 101 290
Operating profit including associates before
special items and remeasurements 6,024 4,361
Underlying earnings - core operations (1) 3,058 1,994
(1) See note 3 to the Condensed financial statements
This improvement in operating profit was primarily driven by increases in
realised prices of commodities. These included a 70% rise in achieved
Australian export metallurgical coal prices, a 56% increase in achieved FOB
iron ore prices, a 48% increase in realised South African export thermal
coal prices, a 37% improvement in realised copper prices, and a 12% increase
in platinum prices. Production across the Group`s operations was negatively
affected by heavy rainfall and flooding, adversely affecting operating
profit. Lower production volumes and mining cost pressures affecting the
industry resulted in higher unit costs of production across the Group.
The Group`s results are influenced by a variety of currencies owing to the
geographic diversity of the Group. For the first half of 2011, there was a
negative exchange variance in operating profit of $527 million compared to
the first half of 2010. The Group results were affected negatively by the
weakening of the US dollar versus the South African rand, Chilean peso,
Brazilian real, and Australian dollar relative to the first half of 2010.
Towards the beginning of this document, reference has been made to core
operations. Operations considered core to the Group are Iron Ore and Manganese
(Kumba Iron Ore, Iron Ore Brazil and Samancor), Metallurgical Coal, Thermal
Coal, Copper, Nickel, Platinum, and Diamonds. During the first half of 2011
the Group decided to retain the Peace River Coal, Catalao and Copebras assets
(Other Mining and Industrial segment). These retained assets delivered a
combined increase in operating profit of 118% compared with the same period of
the prior year. This was driven by operational improvements at Peace River
Coal and an increase in sales volumes and prices at Copebras owing to high
demand for fertilisers.
Group underlying earnings were $3,120 million, a 41% increase on 2010. Group
underlying earnings per share were $2.58 compared with $1.84 in the first half
of 2010.
Reconciliation of profit for the period to 6 months 6 months
Underlying earnings ended ended
$ million 30 June 2011 30 June 2010
Profit for the financial period attributable to
equity shareholders of the Company 3,988 2,061
Operating special items 25 104
Operating remeasurements (336) 41
Net (profit)/loss on disposals (423) 88
Financing special items - 13
Financing remeasurements (49) (154)
Special items and remeasurements tax (136) 56
Non-controlling interests on special items and
remeasurements 51 3
Underlying earnings 3,120 2,212
Underlying earnings per share ($) 2.58 1.84
6 months 6 months
Summary income statement ended ended
$ million 30 June 2011 30 June 2010
Operating profit from subsidiaries and joint
ventures before
special items and remeasurements 5,180 3,715
Operating special items (25) (93)
Operating remeasurements 328 (33)
Operating profit from subsidiaries and joint ventures 5,483 3,589
Net profit/(loss) on disposals 417 (92)
Share of net income from associates (see
reconciliation below) 605 384
Total profit from operations and associates 6,505 3,881
Net finance income/(costs) before remeasurements 20 (130)
Financing remeasurements 46 152
Profit before tax 6,571 3,903
Income tax expense (1,556) (1,216)
Profit for the financial period 5,015 2,687
Non-controlling interests (1,027) (626)
Profit for the financial period attributable to
equity shareholders of the Company 3,988 2,061
Basic earnings per share ($) 3.30 1.71
Group operating profit including associates
before special items and remeasurements(1) 6,024 4,361
Operating profit from associates before special
items and remeasurements 844 646
Operating special items and remeasurements 8 (19)
Net profit on disposals 6 4
Net finance costs (before special items and
remeasurements) (26) (56)
Financing special items and remeasurements 3 (11)
Income tax expense (after special items and
remeasurements) (221) (171)
Non-controlling interests (after special items
and remeasurements) (9) (9)
Share of net income from associates 605 384
(1) Operating profit before special items and remeasurements from subsidiaries
and joint ventures was $5,180 million (six months ended 30 June 2010: $3,715
million) and the attributable share from associates was $844 million (six
months ended 30 June 2010: $646 million). For special items and
remeasurements, see note 4 to the Condensed financial statements.
Special items and remeasurements
6 months ended 30 June 2011
Subsidiaries
and joint
ventures Associates Total
$ million
Operating special items (25) - (25)
Operating remeasurements 328 8 336
Operating special items and remeasurements 303 8 311
Net profit on disposals 417 6 423
Financing special items - - -
Financing remeasurements 46 3 49
Special items and remeasurements tax 140 (4) 136
6 months ended 30 June 2010
Subsidiaries
and joint
ventures Associates Total
$ million
Operating special items (93) (11) (104)
Operating remeasurements (33) (8) (41)
Operating special items and remeasurements (126) (19) (145)
Net profit on disposals (92) 4 (88)
Financing special items - (13) (13)
Financing remeasurements 152 2 154
Special items and
remeasurements tax (57) 1 (56)
Operating special items and remeasurements, including associates, amounted to
a gain of $311 million, principally in respect of non-hedge derivatives of
capital expenditure in Iron Ore Brazil (IOB). Derivatives which have been
realised during the period resulted in a net operating remeasurement gain
since their inception of $224 million.
Net profit on disposals of $423 million, including associates, principally
relates to the $397 million profit on the Group`s disposal of its 100%
interest in the Lisheen zinc mine and its 74% interest in Black Mountain
Mining (Proprietary) Limited, which holds 100% of the Black Mountain mine and
the Gamsberg project.
These disposals were completed in February 2011 and resulted in a net cash
inflow of $499 million.
Financing remeasurements, including associates, reflect a net gain of $49
million relating to gains on embedded and non-hedge derivatives and other
remeasurements.
Special items and remeasurements tax, including associates, amounted to a
credit of $136 million relating to a credit for one-off tax items of $154
million, a tax remeasurement credit of $126 million and a tax charge on
special items and remeasurements of $144 million. One-off tax items
principally relate to the recognition of deferred tax assets in IOB originally
written off as part of the impairment charges which related to the Amapa iron
ore system in 2009, and a capital gains tax refund which related to a prior
year disposal.
Net finance income
Net finance income, before remeasurements, excluding associates, was $20
million (compared to a charge of $130 million in the six months ended 30 June
2010). This was primarily due to increased interest income on investments and
an increase in interest capitalised.
Tax 6 months ended 30 June 2011
Associates`
tax and
Before special non-
$ million items and controlling Including
(unless otherwise stated) remeasurements interests associates
Profit before tax 5,793 225 6,018
Tax (1,696) (217) (1,913)
Profit for the financial period 4,097 8 4,105
Effective tax rate
including associates (%) 31.8
6 months ended 30 June 2010
Associates`
tax and
Before special non-
$ million items and controlling Including
(unless otherwise stated) remeasurements interests associates
Profit before tax 3,991 184 4,175
Tax (1,159) (172) (1,331)
Profit for the financial period 2,832 12 2,844
Effective tax rate
including associates (%) 31.9
IAS 1 (Revised) Presentation of Financial Statements requires income from
associates to be presented net of tax on the face of the income statement.
Associates` tax is therefore not included within the Group`s income tax
expense. Associates` tax included within `Share of net income from associates`
for the six months ended 30 June 2011 is $221 million. Excluding special items
and remeasurements, this becomes $217 million.
The effective rate of tax before special items and remeasurements including
attributable share of associates` tax for the six months ended 30 June 2011
was 31.8%. This was in line with the equivalent effective rate of 31.9% in the
six months ended 30 June 2010. In future periods it is expected that the
effective tax rate, including associates` tax, will remain above the United
Kingdom statutory tax rate.
Balance sheet
Equity attributable to equity shareholders of the Company was $37,697 million
at 30 June 2011, up on the $34,239 million at 31 December 2010, mainly due to
the profit for the period of $3,988 million. Investments in associates were
$401 million higher than at 31 December 2010, principally as a result of a
significant improvement in earnings at De Beers. Property, plant and equipment
increased by $1,623 million compared to 31 December 2010, due to the ongoing
progress of projects during the half year. There were no assets classified as
held for sale at 30 June 2011 (compared to assets, net of associated
liabilities, of $188 million at 31 December 2010) due to the sale of the
remaining Zinc assets during the period. An increase of $865 million in
inventories and current trade and other receivables was driven by the impact
of higher commodity prices and a weaker dollar during the first half of 2011.
Cash flow
Net cash inflows from operating activities were $3,986 million compared with
$2,686 million in the six months ended 30 June 2010. EBITDA was $7,112
million, an increase of 31% from $5,414 million in the prior period,
reflecting strong prices across the Group`s core commodities.
Net cash used in investing activities was $1,682 million compared with $2,397
million in the six months ended 30 June 2010. Purchases of property, plant and
equipment, net of related derivative cash flows, amounted to $2,328 million,
an increase of $335 million, reflecting major spend on the Group`s strategic
growth projects. In the first half of 2011, proceeds from disposals,
principally of the Group`s remaining Zinc portfolio (net of cash and cash
equivalents disposed) were $505 million (proceeds from disposals six months
ended 30 June 2010: $160 million).
Net cash used in financing activities was $1,909 million compared with $616
million in the six months ended 30 June 2010. During the period the Group paid
the 2010 final dividend of $495 million to shareholders, and an additional
$461 million in dividends to non-controlling interests compared with the same
period in 2010.
Liquidity and funding
Net debt, including related hedges, was $6,794 million, a decrease of $590
million from $7,384 million at 31 December 2010. The decrease in net debt
reflects strong operating cash flows.
Net debt at 30 June 2011 comprised $13,558 million of debt, partly offset by
$6,805 million of cash and cash equivalents, and the current position of
derivative liabilities related to net debt of $41 million. Net debt to total
capital (1) at 30 June 2011 was 14.0%, compared with 16.3% at 31 December
2010.
At 30 June 2011, the Group had undrawn bank facilities of $9.0 billion.
The Group`s forecasts and projections, taking account of reasonably possible
changes in trading performance, indicate the Group`s ability to operate within
the level of its current facilities for the foreseeable future.
(1) Net debt to total capital is calculated as net debt divided by total
capital. Total capital is net assets excluding net debt.
Group corporate cost allocation
Corporate costs which are considered to be value adding to the business units
are allocated to each business unit and costs reported externally as Group
corporate costs only comprise costs associated with parental or direct
shareholder related activities.
Dividends
An interim dividend of 28 US cents per share has been declared.
Related party transactions
Related party transactions are disclosed in note 16 to the Condensed financial
statements.
Principal risks and uncertainties
Anglo American is exposed to a variety of risks and uncertainties which may
have a financial, operational or reputational impact on the Group and which
may also impact the achievement of social, economic and environmental
objectives.
The principal risks and uncertainties facing the Group at the year end were
set out in detail in the Operating and financial review section of the Annual
Report 2010, and remain appropriate in 2011. Key headline risks relate to the
following:
- Commodity prices
- Liquidity risk
- Counterparty risk
- Currency risk
- Inflation
- Health and safety
- Environment
- Exploration
- Political, legal and regulatory
- Climate change
- Supply risk
- Reserves and resources
- Operational performance and project delivery
- Event risk
- Employees
- Contractors
- Business integrity
- Joint ventures
- Acquisitions and divestments
- Infrastructure
- Community relations
The Group is exposed to changes in the economic environment, as with any other
business.
Details of any key risks and uncertainties specific to the period are covered
in the Operations review section.
The Annual Report 2010 is available on the Group`s website
www.angloamerican.com.
Operations review for the six months ended 30 June 2011
In the operations review on the following pages, operating profit includes the
attributable share of associates` operating profit and is before special items
and remeasurements unless otherwise stated. Capital expenditure relates to
cash expenditure on property, plant and equipment (net of related
derivatives).
IRON ORE AND MANGANESE
6 months 6 months
$ million ended ended
(unless otherwise stated) 30 June 2011 30 June 2010
Operating profit 2,507 1,628
Kumba Iron Ore 2,437 1,470
Iron Ore Brazil (36) (51)
Samancor 106 209
EBITDA 2,611 1,711
Net operating assets 12,877 10,679
Capital expenditure 595 467
Share of Group operating profit 42% 37%
Share of Group net operating assets 28% 27%
Operating profit before special items and remeasurements increased by 54% from
$1,628 million to $2,507 million, principally due to strong export prices,
with a year-on-year weighted average price increase of 56% in export iron ore
for Kumba offsetting lower export sales volumes and the impact of stronger
exchange rates.
Markets
Total world crude steel production continued to grow and reached 760 Mt for
the first six months of 2011, up from 717 Mt in 2010, a 6% increase. China`s
crude steel production during the first six months of 2011 increased 9% year-
on-year to 352 Mt despite monetary tightening policies. Crude steel production
in Japan has remained flat year-on-year, in spite of production disruptions
caused by the earthquake and tsunami in March. Global seaborne iron ore
imports rose by 5% year-on-year to 515 Mt, driven mainly by an 11% increase in
demand in China. With adverse weather and logistics constraints impacting
seaborne iron ore supply, the market has remained tight, which incentivised
Chinese steel mills to source domestically produced iron ore. While Chinese
domestic iron ore production increased, the average implied grade continued to
fall.
Iron ore index prices peaked during the first quarter and, although retreating
from these levels, have remained high, underpinned by high cost Chinese
domestic iron ore production. On average, realised quarterly contract and
index prices were aligned for the first half of 2011.
Despite global steel production rebounding above pre-Financial Crisis levels,
prices for manganese ores have been held in check at the current levels on the
back of an even stronger response in supply growth and a build up of port
inventories in China that approached the 4.0 Mt level before dropping back to
3.6 Mt at the end of June. Alloy conversion capacity continued to grow through
the year, placing additional pressure on margins for all alloys, with some
higher cost producers eventually idling capacity to cut losses.
Operating performance
Kumba Iron Ore
Total tonnes mined at Sishen mine increased by 6% from 72.1 Mt in 2010 to 76.7
Mt, of which waste mined was 51.8 Mt, an increase of 12% over the first six
months of 2010. This planned increase in mining activity was negatively
affected by wet pit conditions resulting from excessive rainfall. As a result
of the wet pit conditions, run of mine material supplied to the Dense Media
Separation plant reduced, causing total production at Sishen Mine to decrease
by 12% from 21.1 Mt in 2010 to 18.6 Mt. Production from the Dense Media
Separation plant decreased by 2.4 Mt to 12.3 Mt, which was also reduced by
maintenance downtime and wet feedstock causing blockages in the plant. The jig
plant achieved a run rate in excess of design capacity during the second
quarter which offset the shortfall of the first quarter. The contribution by
the jig plant to Sishen mine`s production decreased to 6.3 Mt in the period
(30 June 2010: 6.4 Mt).
Total sales volumes for Kumba were maintained at approximately 22.0 Mt for the
six months (2010: 21.9 Mt). Export sales volumes from Sishen Mine for the
first six months decreased by 0.4 Mt to 18.4 Mt. Kumba`s export sales volumes
to China increased by 1.9 Mt to 12.7 Mt which represented 69% of total export
volumes for the six months, compared with 57% in the prior period. This was
driven by a 1.1 Mt reduction in export sales to Japan as a result of the
earthquake and tsunami and the rescheduling of vessels from June 2011 to
July 2011. 2.8 Mt of stock was used to supplement the lower production from
the mine.
Iron Ore Brazil
Iron Ore Brazil generated an operating loss of $36 million, largely reflecting
the pre-operational state of the Minas-Rio project.
The Amapa operation contributed an operating profit of $45 million for the
period, compared with an operating loss of $7 million in the first half of
2010, reflecting a strong production performance and continued cost
containment during a period of elevated prices. Production totalled 2.33 Mt in
the period, a 26% increase, including 939,000 tonnes of higher priced pellet
feed, a 37% increase.
Samancor
Operating profit of $106 million is $103 million lower than the prior period,
driven mainly by lower prices and stronger local currencies.
Mine shutdowns in South Africa following the fatality in February 2011
resulted in lower production volumes in South Africa. In addition, production
was lower at Gemco in Australia due to concentrator downtime as well as
conveyor slippages, mainly due to unusually heavy rainfall. Ore production of
3.1 Mt (100% basis) is 8% lower than the prior year and alloy production of
362,000 tonnes (100% basis) is marginally lower than the prior year.
In 2010, high pricing drove a stimulation of domestic Chinese production which
resulted in a stockpile build up. In 2011, the ore sales price has softened
by 11% and, consequently, production levels have fallen and stockpiles have
started to reduce.
Projects
The development of the 9 Mtpa Kolomela Mine continues and overall project
progress reached 94%. Construction is substantially complete and various
systems of the plant have been handed over for cold commissioning. Transnet
has made significant progress in the construction of the direct rail link
from the mine to the Sishen-Saldanha iron export channel. Hot commissioning
of the plant is expected to start during the third quarter of 2011. During
the process, ore will be fed through the plant, resulting in work in process
stock and some saleable product being produced during 2011.
For the six months ended 30 June 2011, 15.3 Mt of material was mined at
Kolomela at a cost of $73 million, bringing the total waste mined as part of
the mine`s development since 2008 to 37.3 Mt (Total cost - 2008 to 2010: $189
million). 600,000 tonnes of ore has been mined and stockpiled for the
commissioning of the plant. The life of mine has been extended by eight years
to 28 years since the initial investment decision. At this stage of the
project, it is anticipated that the mine will be ramped up to produce 4 Mt to
5 Mt during 2012 and to produce at design capacity of 9 Mtpa in 2013.
At the 26.5 Mtpa Minas-Rio iron ore project, civil works commenced, on
schedule, at the beneficiation plant during March. Construction is under way
for the tailings dam and earthworks continue in order to support the
continuation of civil works (including the completion of earthworks associated
with the primary crusher). The pipeline element of the project is continuing,
with 25% of pipeline construction completed. At the port, offshore works have
continued, with the final piles of the iron ore pier driven in June and the
access bridge and tug boat pier completed, while onshore civil works have
continued in line with the schedule during the period.
Anglo American continues to work closely with the state and federal
authorities towards the receipt of all relevant licences and permits. The
project remains on target to deliver first ore on ship in the second half of
2013. During the first half of 2011, licence and permit receipts continued,
including securing the Mineral Easement and progressing land access, though
there are still a number of other licences and permits to be secured in
relation to the pipeline and the beneficiation plant during the remaining
period of project development.
Pre-feasibility studies for the second phase of the Minas-Rio iron ore project
commenced during 2011 and, while ongoing, these studies, together with the
current resource statement (total resource volume (measured, indicated and
inferred)) of 5.8 billion tonnes, support the expansion of the project.
The second expansion of the GEMCO operation in the Northern Territory of
Australia was recently approved. This follows the successful completion of
the GEMCO Expansion Phase 1 (GEEP1) project in January 2010.
The $279 million GEEP2 project (Anglo American`s 40% share $112 million) will
increase GEMCO`s beneficiated product capacity from 4.2 Mtpa to 4.8 Mtpa
through the introduction of a dense media circuit by- pass facility. The
project is expected to be completed in late 2013. The expansion will also
address infrastructure constraints by increasing road and port capacity to 5.9
Mtpa, creating 1.1 Mtpa of latent capacity for future expansions.
The first phase expansion confirmed GEMCO`s status as the world`s largest and
lowest cost producer of manganese ore. This second expansion will further
enhance GEMCO`s competitive advantages and create additional options for
growth.
At the Hotazel Manganese mines, the central block development project at
Wessels will increase production by between 0.5 Mtpa to 1.5 Mtpa. This will be
completed in 2013 and is expected to require approximately $43 million (on a
100% basis) of investment to complete.
The High Carbon Ferro Manganese furnace M14 at the Metalloys smelter in
Meyerton, South Africa will add an additional 75,000 tonnes per annum capacity
to the smelter at a cost of $90 million (on a 100% basis) and will take two
years to complete.
Outlook
Kumba Iron Ore
Chinese crude steel production is expected to increase by around 8% from 2010
levels. World steel production, however, is expected to ease back in the
coming months owing to stock cycle turns, with global crude steel production
anticipated to increase by about 6%. Crude steel production during the second
half of the year is seasonally lower than the first half. This is expected to
put modest downward pressure on iron ore prices in the final quarter of 2011.
Kumba has implemented focused plans to recover the majority of the first
half`s production shortfall by the end of 2011. Waste mining at Sishen Mine is
anticipated to increase as pit conditions that hampered mining during the
first six months subside. Export sales for 2011 are expected to remain in line
with 2010 levels.
Samancor
Prices have held steady at current levels ($5.30/dmtu CIF China), as port
inventories have declined in nine out of the last 10 weeks - however they
remain well above normal levels as the market moves into the traditionally
slower summer months. Alloy markets remain mixed with Asian markets below
$1,200/t for silico manganese and high carbon ferro manganese, while the US
market is slightly firmer at the $1,250/t to $1,275/t range. Latent capacity,
power costs and strong competition from exports in Korea and India in
particular may impact prices achieved for Samancor`s products over the
remainder of the year.
METALLURGICAL COAL
6 months 6 months
$ million ended ended
(unless otherwise stated) 30 June 2011 30 June 2010
Operating profit 491 263
EBITDA 663 416
Net operating assets 4,263 3,172
Capital expenditure 206 21
Share of Group operating profit 8% 6%
Share of Group net operating assets 9% 8%
Metallurgical Coal generated an operating profit of $491 million, an 87%
increase, primarily due to higher realised export prices, which more than
offset the impact of heavy rain and a strong Australian dollar. Production at
the Queensland operations was affected by heavy rainfall and subsequent
flooding in late 2010 and in the first quarter of 2011. In June 2011,
production returned to normal operating levels as a result of proactive
recovery actions put in place in the first quarter with previously announced
force majeure declarations removed from the Queensland export operations.
Insurance claims are currently being prepared but recoveries are not expected
to be significant in the context of the Group`s results.
Markets
6 months 6 months
ended ended
Anglo American weighted average achieved FOB 30 June 2011 30 June 2010
sales prices
($/tonne)
Australian export metallurgical coal 251 148
Australian export thermal coal 103 83
Australian domestic thermal coal 35 29
6 months 6 months
ended ended
Attributable sales volumes 30 June 2011 30 June 2010
(`000 tonnes)
Australian export metallurgical coal 5,737 7,345
Australian export thermal coal 2,547 3,182
Australian domestic thermal coal 3,759 4,267
The market experienced a shortage of metallurgical coal in the first quarter
due to supply disruptions resulting from the severe flooding in Queensland.
Metallurgical coal sales decreased by 22% from 7.3 Mt to 5.7 Mt. The shortages
resulted in record quarterly price settlements in the second quarter across
all metallurgical coal products, with Metallurgical Coal being the first
producer to settle quarterly pricing arrangements. Early engagement with
customers allowed the business to effectively manage the impacts of the
floods.
Global steel production continued to grow, but developed economies are still
producing at below pre- recession levels with steel prices being supported by
escalated raw material costs rather than a recovery in steel demand.
Operating performance
6 months 6 months
ended ended
Attributable production 30 June 2011 30 June 2010
(`000 tonnes)
Export metallurgical coal 5,699 7,080
Thermal coal 6,090 7,320
Saleable production across all coal products decreased by 18%. Export
metallurgical coal production decreased by 19% to 5.7 Mt and thermal coal
production decreased by 17% to 6.1 Mt, both owing to the weather. The recovery
actions initiated in the first quarter resulted in export metallurgical coal
sales increasing by 79% in the second quarter compared to the first quarter.
Projects
Studies continue at the greenfield projects of Grosvenor, Moranbah South,
Dartbrook and Drayton South in order to meet expectations of growing demand
for both metallurgical and thermal coal. It is expected that a Board approval
decision in relation to the development of the 4.3 Mtpa Grosvenor
metallurgical coal project in Australia will be taken within the next 12
months.
Outlook
Production volumes are expected to increase in the second half of the year as
operations return to normal levels of activity and the recovery initiatives
deliver some of the lost volumes. Significant progress has been made in
embedding longwall productivity improvement. A comprehensive programme to
reduce the impact of rain on the open cut operations ahead of the next wet
season has been implemented.
The global market outlook for hard coking coal remains strong, driven by
continued demand from India and China. A gradual price decline from record
levels is expected in the second half of 2011 as Australian metallurgical coal
supply recovers from the disruptions in the early part of the year. A
continued focus on longwall productivity and asset optimisation programmes is
expected to increase production in 2012.
THERMAL COAL
6 months 6 months
$ million ended ended
(unless otherwise stated) 30 June 2011 30 June 2010
Operating profit 521 351
South Africa 319 220
Colombia 212 143
Projects and corporate (10) (12)
EBITDA 611 433
Net operating assets 2,080 1,740
Capital expenditure 31 140
Share of Group operating profit 9% 8%
Share of Group net operating assets 5% 4%
Thermal Coal generated an operating profit of $521 million, a 48% increase on
the equivalent period of 2010, driven by higher export thermal coal prices for
both South African and Colombian coal. Profits have been put under pressure by
the strong rand, lower South African export sales volumes, and above inflation
cost increases.
Markets
6 months 6 months
ended ended
Anglo American weighted average achieved FOB 30 June 2011 30 June 2010
sales prices
($/tonne)
South Africa export thermal coal 120 81
South Africa domestic thermal coal 26 23
Colombia export thermal coal 101 68
6 months 6 months
ended ended
Attributable sales volumes 30 June 2011 30 June 2010
(`000 tonnes)
South Africa export thermal coal(1) 6,781 7,689
South Africa domestic thermal coal(1) (2) 2,602 2,613
Colombia export thermal coal 5,000 5,026
(1) Includes the capitalised sales from Zibulo mine, which is currently not in
commercial production
(2) Includes domestic metallurgical coal of 172 kt (six months ended 30 June
2010: 219 kt)
The first half of 2011 saw strong growth in US thermal coal exports to around
15 Mt, more than double the same period last year, driven by diminished
domestic requirements and the attraction of strong export prices,
predominantly into Europe. South African thermal coal exports were 0.9 Mt
lower, mainly owing to poor performance by Transnet adversely affecting
railings to the Richards Bay Coal Terminal (RBCT). Indonesian exports
continued to increase during the first half of 2011 to satisfy both Chinese
demand and increased imports of low calorific value thermal coal into India.
Strong market fundamentals resulted in South African (RBCT) and Australian
(Newcastle) FOB prices averaging $121 per tonne and $124 per tonne
respectively for the period, an increase of approximately $30 per tonne (33%)
over the same period in 2010.
Operating performance
6 months 6 months
ended ended
Attributable production 30 June 2011 30 June 2010
(`000 tonnes)
RSA thermal coal (1) (2) 10,507 10,135
RSA Eskom coal (2) 17,058 16,487
Colombian export thermal coal 5,147 5,318
(1) Includes domestic metallurgical coal of 163 kt (six months ended 30 June
2010: 222 kt)
(2) Includes the capitalised production from Zibulo mine, which is currently
not in commercial production
South Africa
Operating profit from South African sourced coal increased by 45% to $319
million, driven by higher export thermal coal prices. Production for the first
half of the year increased by 4% to 27.6 Mt. The ramp-up of Zibulo has
proceeded well with some sections opening ahead of schedule; however, these
gains have been partly offset by geological issues at some of the underground
operations and heavy rainfall at the opencast operations. Costs were impacted
by above-inflation increases in labour, power and fuel, as well as additional
stock management costs resulting from an increase in stock levels at the
operations following train derailments during the first quarter, as well as
the 20-day extended maintenance stoppage during May and June 2011 on the
railway line to RBCT. Export sales volumes were also similarly affected.
Colombia
At Cerrejon, operating profit of $212 million was 48% higher. This performance
was principally due to higher thermal coal prices in the European and American
markets arising from a gradual recovery in demand, underpinned by supply
constraints following the extreme rainfall experienced globally in the fourth
quarter of 2010. Production was negatively affected by the increase in rain
related stoppages during the period, but this impact was mitigated by mining
efficiencies and scheduling resulting in production being only 3% lower than
the first six months of 2010.
Projects
The 6.6 Mtpa Zibulo project in South Africa produced its first coal in the
third quarter of 2009. Full production is expected to be achieved during the
fourth quarter of 2012.
The New Largo Coal Project, which is currently in feasibility stage, has two
main elements: a conveyor which will run from an existing coal plant to an
Eskom power station and a new opencast mine. The operation is planned to mine
domestic thermal coal and Thermal Coal is currently negotiating a coal supply
agreement with Eskom for delivery into its Kusile power station. Feasibility
studies commenced in August 2010 and are expected to be completed by the third
quarter of 2011, for the conveyor and the first quarter of 2012 for the mine.
Anglo American Board approval is anticipated to be sought by the third quarter
2012. First coal on conveyor is expected in the fourth quarter of 2013 and
first coal from the mine is planned for 2015. The current life of mine is
approximately 50 years.
The Cerrejon P500 Phase1 expansion project, to increase production at Cerrejon
by 8 Mtpa, is targeting final approval from its shareholders in the third
quarter of 2011. First coal is targeted during the fourth quarter in 2013 and
the project is expected to achieve full production at the end of 2015.
Outlook
The thermal coal market is expected to be tighter in the second half of 2011
as increased supply from Indonesia, Australia and Americas is not expected to
satisfy stronger seaborne demand. The Asian markets are likely to remain
strong particularly in India and China. In addition, Japanese demand is
expected to recover following the earthquake and tsunami. In Germany, thermal
coal is expected to be a substitute for nuclear power generation, which has
been reduced in response to the Fukushima disaster.
COPPER
6 months 6 months
$ million ended ended
(unless otherwise stated) 30 June 2011 30 June 2010
Operating profit 1,401 1,185
EBITDA 1,527 1,312
Net operating assets 7,050 5,152
Capital expenditure 831 601
Share of Group operating profit 23% 27%
Share of Group net operating assets 15% 13%
Copper generated an operating profit of $1,401 million, an increase of 18%,
underpinned by a record average copper price. This benefit was partially
offset by a weaker US dollar, which had a material impact on Chilean peso
denominated input costs, and higher power and fuel related costs. The decision
to incur additional logistics costs at Collahuasi to maximise sales whilst the
Patache port shiploader was being repaired also had an impact on unit costs.
Markets
6 months 6 months
ended ended
30 June 2011 30 June 2010
Average market prices (c/lb) 426 323
Average realised prices (c/lb) 422 308
Copper prices increased strongly during the first two months of the year to a
new nominal record high of 460 c/lb, reflecting expectations of improving
global economic conditions. Despite these positive signs, the global economic
recovery began to lose momentum during the second quarter, as higher oil
prices and the impact of the Japanese earthquake curtailed global
manufacturing activity. An intensification of the sovereign debt crisis in
Europe, further tightening of monetary policy in China and other emerging
economies and concerns over the end of quantitative easing in the US, all
contributed to downward pressure on many commodity prices.
The copper price ended the half year period at 422 c/lb despite such
pressures, with the realised price averaging 422 c/lb over the first six
months, a 37% increase compared with the same period in 2010. The negative
provisional price adjustment of $36 million was 69% lower than the first half
of 2010.
Operating performance
6 months 6 months
ended ended
30 June 2011 30 June 2010
Attributable copper production (tonnes) 289,100 315,500
Total copper production of 289,100 tonnes was 8% lower than the same period in
2010.
Attributable production from Collahuasi was 12% lower at 103,200 tonnes,
principally due to abnormally high rainfall in the first quarter, which
affected throughput and also resulted in mining areas with lower than
anticipated grades. Los Bronces` production was 9% lower at 101,700 tonnes,
also due to anticipated lower grades and a temporary failure in a return-
solutions pipeline impacting cathode production, partly offset by higher
throughput as a result of asset optimisation and more favourable ore
characteristics. El Soldado`s production was 11% lower at 17,900 tonnes due to
lower throughput and recoveries, although partly offset by the implementation
of an asset optimisation project which allows additional copper to be
recovered by processing slag from the Chagres smelter. Mantos Blancos`
production was 2% lower at 36,100 tonnes as a result of lower grades.
Mantoverde`s production was 2% higher than prior year at 30,200 tonnes owing
to significantly higher throughput, partially offset by lower grades.
The impact on sales volumes at Collahuasi resulting from the December 2010
shiploader failure at the Patache port was largely negated by the successful
implementation of a contingency plan that included shipping copper concentrate
via the Arica, Iquique and Antofagasta ports. Remaining stocks of concentrate
are expected to be sold in the second half with the shiploader now repaired
and in use.
Projects
Construction of the $2.8 billion Los Bronces expansion project continues to
progress and remains on schedule for first production in the fourth quarter of
2011. Production at Los Bronces is scheduled to increase to 490 ktpa over the
first three years of full production following project completion and to
average 400 ktpa over the first 10 years. Despite the current industry-wide
cost pressures, Los Bronces is expected to have highly attractive cash
operating costs, and reserves and resources that support a mine life of more
than 30 years, with further expansion potential.
At Collahuasi, an expansion project to increase concentrator plant capacity to
150,000 tonnes of ore per day, an annual average production increment of
19,000 tonnes per year of copper over the estimated life of mine, will be
commissioned in the third quarter of 2011 and a further project to increase
throughput to 160,000 tonnes of ore per day, an annual average production
increment of 20,000 tonnes per year of copper over the estimated life of mine,
in the first half of 2013 was recently approved. A pre-feasibility study has
also recently commenced to evaluate the next phases of expansion at
Collahuasi, with options to ultimately increase annual production to at least
1 Mt of copper.
In Peru, Anglo American is focusing on obtaining the necessary water permits
for the Quellaveco project to progress to Board approval for the construction.
Also in Peru, early-stage work continues at the Michiquillay project. Drilling
relating to the geological exploration programme will restart once discussions
with the local communities have been completed. It is currently envisaged that
the project will move to the pre-feasibility stage following the completion of
drilling analysis and ore body modelling.
Activity at the Pebble project in Alaska continues with the focus on
completing a pre-feasibility study by late 2012. An environmental baseline
document and a project update will be released in the second half of 2011.
Ongoing efforts include an independent scientific review of the project`s
Environmental Baseline Studies facilitated by the Keystone Center.
Outlook
Operational improvements and the scheduled commissioning of the Los Bronces
expansion project in the fourth quarter are expected to lead to marginally
higher full year production levels compared with 2010. Copper production is
expected to increase significantly in 2012 as the Los Bronces expansion
project ramps up towards full capacity.
Industry wide input cost pressures are expected to remain tight in the short
term, particularly in relation to power and fuel related costs, although these
will be partially mitigated by the increased production from the expanded Los
Bronces operation.
Ongoing market concerns arising from uncertainties over the near-term outlook
for the global economy may lead to relatively pronounced short-term volatility
in commodity prices, including copper. However, the medium-to long-term
fundamentals for copper remain strong, predominantly driven by robust demand
from the emerging economies and the lack of new supply.
NICKEL
6 months 6 months
$ million ended ended
(unless otherwise stated) 30 June 2011 30 June 2010
Operating profit 93 68
EBITDA 106 81
Net operating assets 2,526 1,988
Capital expenditure 177 223
Share of Group operating profit 2% 2%
Share of Group net operating assets 5% 5%
Nickel generated an operating profit of $93 million, a 37% increase, driven by
21% higher sales volumes from Codemin and Loma de Niquel and a higher nickel
price. Operating profit was net of $11 million project costs, a $10 million
increase compared with the same period in 2010.
Markets
6 months 6 months
ended ended
30 June 2011 30 June 2010
Average market prices (c/lb) 1,159 962
Average realised prices (c/lb) 1,105 969
The average nickel market price was 20% higher than for the same period in
2010, supported by growth in the stainless steel industry. Nickel demand
growth was not matched by growth in industry supply which was affected by
delays to a number of projects.
During the first half of 2011, LME nickel stocks decreased by 22% from a high
of 137,766 tonnes on 14 January, to 107,148 tonnes on 30 June, indicative of
the underlying physical demand for nickel. After a strong beginning to the
year, however, nickel prices moved downwards in the second quarter, which may
be attributed to uncertainty around the European economy, softer summer
demand, the arrival of production from new projects, including Barro Alto, to
the market and an increase in nickel pig iron production in China.
Operating performance
6 months 6 months
ended ended
30 June 2011 30 June 2010
Attributable nickel production (tonnes) 12,700 10,100
Nickel production increased by 26% to 12,700 tonnes owing to higher output at
Loma de Niquel and delivery of the Barro Alto project.
In the first half of the year there were two additional months of production
from Loma de Niquel`s Electric Furnace 2, which had been restarted from March
2010, while the power rationing imposed by the Venezuelan government in the
first half of 2010 did not apply in the first half of 2011. However, in June,
the Venezuelan government announced that power rationing would be imposed in
the second half of 2011. The Loma de Niquel operation is pursuing a mitigation
process and has hired on-site generators.
The newly commissioned Barro Alto operation produced 1,100 tonnes during the
first half and is expected to produce around 12,000 tonnes to 14,000 tonnes in
2011.
Production levels at Codemin were in line with 2010.
Projects
First metal from the Barro Alto ferronickel project was produced on schedule
in March 2011. The new nickel plant is expected to reach full production
capacity in the second half of 2012. Barro Alto will have a competitive cost
position and is expected to produce an average of 36 ktpa of nickel at full
production, and 41 ktpa during the first five years.
Outlook
Production of nickel during the second half of the year is expected to be
significantly higher, reflecting the ramp-up of Barro Alto. In Venezuela,
production will be affected by power rationing, despite mitigation measures.
In the short-to mid-term, nickel prices will be heavily influenced by the
successful delivery of new projects, some of which are using unproven
processing technology, as well as the introduction to the market of physically
backed Exchange Traded Funds (ETFs). The long term outlook for nickel,
however, remains positive, underpinned by stainless steel demand growth,
estimated at more than 5% per annum, driven by industrialisation and
urbanisation in emerging economies.
PLATINUM
6 months 6 months
$ million ended ended
(unless otherwise stated) 30 June 2011 30 June 2010
Operating profit 542 418
EBITDA 931 785
Net operating assets 13,258 12,169
Capital expenditure 410 431
Share of Group operating profit 9% 10%
Share of Group net operating assets 29% 31%
Platinum recorded an operating profit of $542 million, a 30% increase,
primarily due to higher sales volumes during a period of robust pricing.
Sales volumes of refined platinum and the overall average realised basket
price increased by 13% and 15% respectively, the benefits of which were
partially offset by a stronger rand on average. Cash operating costs per
equivalent refined platinum ounce increased by 13% compared with the first
half of 2010.
Markets
The average dollar realised price for platinum was $1,782 per ounce for the
period, a 12% increase compared with $1,593 per ounce in the comparable
period. The average realised prices for palladium and rhodium sales were $775
per ounce (six months ended June 2010: $462) and $2,266 per ounce (six months
ended June 2010: $2,600) respectively. The average realised price on nickel
sales was $11.55 per pound (six months ended June 2010: $9.52). The overall
average realised dollar basket price was 15% higher at $2,927 per platinum
ounce sold.
Anglo American Platinum (Platinum) maintains its view that the platinum market
will remain in balance in 2011 owing to continued recovery in the autocatalyst
and industrial segments and the sustained strength of the jewellery segment,
particularly in China. Platinum expects primary supply to improve from 2010
levels, implying underlying growth in demand markets. Primary supply growth
will be challenged by safety-related and other labour issues.
Autocatalysts
Global vehicle production in 2011 is expected to reach in excess of 75 million
vehicles, implying a 3% growth from 2010 levels. The earthquake in Japan
resulted in supply disruption for the Japanese auto manufacturers, with
estimates that the disaster resulted in a worldwide production loss of
approximately 2.8 million vehicles. Most of this loss is expected to be
recovered by the second quarter of 2012. Sales volumes across all major
markets, with the exception of Japan, have been higher in the period compared
with 2010 levels. This trend is expected to continue as the market continues
to recover towards pre-crisis levels.
Industrial
Following the recovery from the previous year, demand from the industrial
sector is expected to remain strong in the near to medium term. Demand for PGM-
related consumer goods, including electronics, packaging and other chemicals,
continues to show strong growth, particularly in Asian markets. The fuel cell
industry continues to develop in a commercial capacity, with significant fuel
cell unit growth in the stationary power sector, driven by demand in
residential units and off-grid mobile base stations.
Jewellery
The platinum jewellery market benefited from relative price stability and
higher gold prices. The developed jewellery markets have remained healthy,
with some regional variation on performance. Jewellery purchases in China have
increased by almost 20% in the first half of 2011 compared with the same
period in 2010. The Indian jewellery market development programme continues to
show success.
Investment
Overall platinum holdings in ETFs have increased by approximately 15% in the
first half of 2011. Net long speculative positions have declined by 36% over
the same period, exhibiting a lack of general confidence in the markets.
Despite this reduction, the platinum price remains resilient and has been
supported above $1,700 per ounce.
Operating performance
Equivalent refined platinum production (equivalent ounces are mined ounces
expressed as refined ounces) from the mines managed by Platinum and its joint
venture partners for the first half of 2011 was 1.16 million ounces, a slight
decrease of 3% when compared to the first half of 2010.
Wholly owned mines produced 763,100 equivalent refined platinum ounces, an
increase of 2% compared with the first half of 2010. The majority of this
increase was from Mogalakwena, Unki and Thembelani. Unki was delivered
successfully, on schedule and within budget in January 2011 and contributed
22,400 additional equivalent refined platinum ounces. In addition, Mogalakwena
open-pit mine continued to perform strongly providing Platinum with a flexible
production source. This was however, partly offset by lower volumes from
Bathopele, Khuseleka and Union mines.
Refined platinum production of 1.2 million ounces for the first half of 2011
represents an increase of 17% in comparison with the same period in 2010.
Eight employees lost their lives during the period and Platinum extends its
sincere condolences to their families, friends and colleagues. Platinum had 33
safety stoppages in the first half of 2011 compared to 17 in the first half of
2010, which was in line with the rest of the industry. Platinum is continuing
to work with Government and Labour towards zero harm.
Projects
Capital expenditure for the first half of 2011, excluding capitalised
interest, amounted to $410 million, of which $223 million was spent on
projects, $138 million on stay-in-business capital and $49 million on waste
stripping at Mogalakwena Mine.
Project capital expenditure for the first half of 2011 was mostly spent on the
Thembelani 2 shaft replacement project ($36 million), the Mortimer Furnace
Upgrade ($35 million), the Twickenham Platinum Mine project ($34 million), the
base metal refinery 33,000 tonnes nickel expansion project ($32 million), the
Unki Platinum mine project ($18 million), and the Khuseleka ore replacement
project ($13 million).
The Unki Platinum Mine Project was handed over to operations in January 2011
and is expected to reach steady state production of 120,000 tonnes milled per
month about a year ahead of schedule. The Base Metal Refinery 33,000 tonnes
nickel expansion project has produced first metal in line with expectations.
It is expected to reach steady state by the end of the year, as planned.
Outlook
Platinum is expecting a stronger second half for the year and maintained an
expected refined production target of 2.6 million ounces of platinum for 2011.
This implies production volume of 1.4 million ounces of platinum in the second
half of 2011 given that we produced 1.2 million ounces in the first half.
Platinum maintains a relentless focus on mitigating industry-wide cost
pressures by improving productivity, increasing efficiency and managing supply
chain and procurement costs, benefiting from Anglo American`s global
initiatives. These initiatives are expected to improve unit costs in the
second half of the year.
Platinum`s project ranking and prioritisation to focus on less capital
intensive projects in the near term, is expected to reduce capital expenditure
for 2011 from $1.16 billion to $1.1 billion, excluding capitalised interest.
DIAMONDS
6 months 6 months
$ million ended ended
(unless otherwise stated) 30 June 2011 30 June 2010
Share of associate`s operating profit 450 261
EBITDA 517 340
Group`s associate investment in De Beers (1) 2,234 1,783
Share of Group operating profit 7% 6%
(1) Excludes shareholder loans of $315 million (30 June 2010: $367 million)
Anglo American`s record share of operating profit from De Beers of $450
million, an increase of 72%, reflected the impact of significant price growth
during the first half of 2011.
Markets
Sales during the period were driven mainly by continued growth mainly in the
Middle East and Asian retail markets and their impact on rough price growth.
Sales of rough diamonds by the Diamond Trading Company (DTC) in the first half
of 2011 were $3.5 billion (including those through joint ventures), a 33%
increase compared with 2010, driven by price growth of approximately 35%. This
is the highest ever sales figure recorded by De Beers for the first half of
the year since privatisation, buoyed by continued retail demand from the
Indian and Chinese consumer markets and stronger than expected demand in
American.
Forevermark (a diamond brand owned by the De Beers Group) continues its
expansion into core retail markets of China, Hong Kong and Japan and has
recently launched in India, Singapore and the Caribbean. The Forevermark brand
is now available from a small number of stores in the US, with further
expansion planned later this year. During the first half of the year, De Beers
Diamond Jewellers (De Beers` joint venture with LVMH) announced the strategic
launch of the brand in China with the opening of its first mainland China
store in Beijing, its first store in Kazakhstan in Almaty and a new store in
Dubai at Dubai Mall. The company will continue its expansion in 2011 with the
opening of further stores in mainland China, a second store in Hong Kong.
Operating performance
De Beers has continued to focus on efficiency improvements and on maintaining
a lower sustainable level of overhead base, which has resulted in a favourable
impact on earnings. In the first six months of 2011, De Beers` production
totalled 15.53 million carats, in line with the first half of 2010, reflecting
the impact of maintenance and asset management difficulties and, to an extent,
excessive rainfall in southern Africa.
Element Six recorded a good first half performance in respect of both sales
and profitability, with robust demand across its product ranges. Operating
performance was impacted by, inter alia, operating challenges and a weak US
dollar, but Element Six is well positioned for the remainder of the year.
Commitment to safety remains De Beers` most important priority. There have
been three loss of life incidents at De Beers during the first half - two at
Namdeb and one at Debswana. Sincere condolences are expressed to the families
of those concerned. Comprehensive safety reviews are being carried out at all
De Beers operations.
Projects and restructuring
Debswana`s Jwaneng mine Cut-8 extension project is progressing satisfactorily,
on schedule and on budget. De Beers Canada recently completed a six month
optimisation study on the Snap Lake Mine to more economically extract this
complicated, but promising ore body that has a forecast 20-year life-of-mine.
Disposals of assets have continued in the period, and in January, De Beers
Consolidated Mines (DBCM) announced that it had entered into an agreement with
Petra Diamonds to sell Finsch mine as a going concern for a consideration of
R1.425 billion ($210 million), plus assumption of rehabilitation liabilities.
In May, DBCM announced that it had entered into an agreement to sell
Namaqualand Mines to Trans Hex in a transaction valued at R225 million. This
completes the De Beers asset disposal programme.
In May, De Beers and the Government of the Republic of Namibia (GRN) announced
a new agreement which will allow GRN to increase its effective shareholding in
De Beers Marine Namibia from 15% to 50% through the establishment of a new
50:50 joint venture holding company. This will not change marketing
arrangements and all diamond production from Namdeb will continue to be
sorted, valued and marketed exclusively by the DTC together with Namibia
Diamond Trading Company, which is also a 50:50 joint venture between the GRN
and De Beers.
Outlook
Despite the ongoing turmoil with the global economy, De Beers is encouraged by
the continued strong growth in price and demand during the first six months of
2011 is highly encouraging. De Beers is confident that the exceptional growth
in retail markets in India and Asia will continue to drive demand for
diamonds. Reports from the recent Jewelers` Circular Keystone (JCK) tradeshow
indicate that the all important Christmas season in the US and Diwali are
expected to be strong.
OTHER MINING AND INDUSTRIAL
6 months 6 months
$ million ended ended
(unless otherwise stated) 30 June 2011 30 June 2010
Operating profit 101 290
Tarmac (22) 29
Scaw Metals 27 83
Copebras 54 12
Catalao 21 28
Peace River Coal 10 (1)
Zinc 20 150
Other (9) (11)
EBITDA 210 427
Net operating assets 4,048 4,213
Capital expenditure 72 104
Share of Group operating profit 2% 7%
Share of Group net operating assets 9% 11%
Tarmac
Tarmac reported an operating loss of $22 million, compared to a profit of $29
million in the first half of 2010. However, on a directly comparable basis,
taking into consideration the impact of European businesses that were sold in
2010, Tarmac`s operating profit showed a reduction of $38 million. Tarmac`s
directly comparable EBITDA performance was 45% lower.
Quarry materials
The UK Quarry Materials business experienced strong first-half volumes, as
severe weather conditions towards the end of 2010 generated significant carry-
over of demand, particularly asphalt volumes on major trunk road schemes, and
on Local Authority schemes. Concrete volumes decreased due to difficult
trading conditions arising from the implementation of various government
austerity measures. The high cost of oil, its impact on input costs, and the
recovery of such costs through price increases remain the key challenges for
the business.
The 2011 outlook in the UK is characterised by impending government spending
cuts, rising cost inflation and fragile private sector recovery.
Building products
Housing, retail and commercial markets have all experienced a decline,
affecting all products. Volumes have suffered as a result of the general
market decline and a more competitive pricing environment, where customers and
competitors have become more focussed on price and less on other value
drivers. The Precast Solutions business, which supplies the commercial market,
is in the process of closure.
Cost reduction initiatives continue to be high on the agenda.
Although a number of initiatives are in progress to improve performance, the
short term market outlook remains difficult.
Scaw Metals
The sale of the Moly-Cop and AltaSteel operations of the Scaw Metals Group was
completed on 31 December 2010.
Scaw Metals generated an operating profit of $27 million, a 67% decrease,
largely as a result of the above disposal. Strong performances were recorded
by the Grinding Media and Wire Rod Product operations, which benefited from
improved demand from mining and offshore customers as well as a turnaround in
business performance, partly offset by the difficult trading conditions in the
Rolled Products operation. Weak demand within the construction sector has
resulted in selling prices not fully reflecting rapidly rising input costs,
resulting in reduced margins. However, a strong focus by management on cost
saving initiatives in all operations and sales to downstream businesses has
mitigated the effects of weak margins to some extent.
Total production of steel products was 356,300 tonnes.
Copebras
Copebras generated a $54 million operating profit, a 350% increase on the
previous period. Sales volumes of low analysis fertilisers and DCP (animal
feed supplement) increased, largely as a result of a very strong Brazilian
`mini crop` which generated unusually high demand for fertiliser products in
the period. The strong performance was partially offset by increased input
costs, particularly from the key non-controllable elements of sulphur, ammonia
and energy and the strength of the Brazilian real.
Domestic soybean and grain industries continue to drive local demand and the
outlook for the product markets continues to be positive, with international
benchmark fertiliser products prices expected to remain strong for the balance
of 2011. The fundamentals for soft commodities remain positive for the medium
term, characterised by the continuing high demand for grains worldwide that is
underpinning an anticipated strong demand for fertilisers.
The Goias 2 project presents an opportunity for future expansion.
Catalao
Catalao generated an operating profit of $21 million, a 25% decrease. Sales of
niobium were 7% lower, mostly attributable to the lower metallurgical recovery
of niobium resulting from the treatment of refractory oxide ore remnants,
ahead of the planned transition to unweathered ore in 2013. Lower sales
volumes were partially offset by higher niobium prices and the market
continues to show steady growth in both demand and price, particularly in the
high strength, low alloy steel sector. The longer term market outlook remains
strong.
Following the positive results of a drilling campaign in 2010, design and
engineering work has commenced on the project for the treatment of unweathered
ore. This is expected to increase production volumes substantially, with
commissioning expected to start in late 2013.
Peace River Coal
Peace River Coal delivered export sales of 515,300 tonnes of hard coking coal,
a 26% increase over the total coal sales tonnes in the equivalent prior year
period, partly driven by operational improvements and shipping timing
differences.
CONDENSED FINANCIAL STATEMENTS
for the six months ended 30 June 2011
Consolidated income statement
for the six months ended 30 June 2011
6 months ended 30.06.11
Before Special
special items and
items and remeasure-
remeasure- ments
US$ million Note ments (note 4) Total
Group revenue 2 15,237 - 15,237
Total operating costs (10,057) 303 (9,754)
Operating profit from
subsidiaries and joint ventures 2 5,180 303 5,483
Net profit/(loss) on disposals 4 - 417 417
Share of net income from
associates 2 593 12 605
Total profit from operations
and associates 5,773 732 6,505
Investment income 340 - 340
Interest expense (348) - (348)
Other financing gains/(losses) 28 46 74
Net finance income/(costs) 7 20 46 66
Profit before tax 5,793 778 6,571
Income tax expense 8 (1,696) 140 (1,556)
Profit for the financial period 4,097 918 5,015
Attributable to:
Non-controlling interests 977 50 1,027
Equity shareholders of the Company 3,120 868 3,988
Earnings per share (US$)
Basic 9 2.58 0.72 3.30
Diluted 9 2.47 0.68 3.15
6 months ended 30.06.10
Before Special
special items and
items and remeasure-
remeasure- ments
US$ million ments (note 4) Total
Group revenue 12,590 - 12,590
Total operating costs (8,875) (126) (9,001)
Operating profit from subsidiaries and
joint ventures 3,715 (126) 3,589
Net profit/(loss) on disposals - (92) (92)
Share of net income from associates 406 (22) 384
Total profit from operations and associates 4,121 (240) 3,881
Investment income 273 - 273
Interest expense (403) - (403)
Other financing gains/(losses) - 152 152
Net finance income/(costs) (130) 152 22
Profit before tax 3,991 (88) 3,903
Income tax expense (1,159) (57) (1,216)
Profit for the financial period 2,832 (145) 2,687
Attributable to:
Non-controlling interests 620 6 626
Equity shareholders of the Company 2,212 (151) 2,061
Earnings per share (US$)
Basic 1.84 (0.13) 1.71
Diluted 1.76 (0.11) 1.65
Year ended 31.12.10
Before Special
special items and
items and remeasure-
remeasure- ments
US$ million ments (note 4) Total
Group revenue 27,960 - 27,960
Total operating costs (19,452) 158 (19,294)
Operating profit from subsidiaries and
joint ventures 8,508 158 8,666
Net profit/(loss) on disposals - 1,579 1,579
Share of net income from associates 845 (23) 822
Total profit from operations and associates 9,353 1,714 11,067
Investment income 568 - 568
Interest expense (801) - (801)
Other financing gains/(losses) (11) 105 94
Net finance income/(costs) (244) 105 (139)
Profit before tax 9,109 1,819 10,928
Income tax expense (2,699) (110) (2,809)
Profit for the financial period 6,410 1,709 8,119
Attributable to:
Non-controlling interests 1,434 141 1,575
Equity shareholders of the Company 4,976 1,568 6,544
Earnings per share (US$)
Basic 4.13 1.30 5.43
Diluted 3.96 1.22 5.18
Consolidated statement of comprehensive income
for the six months ended 30 June 2011
6 months ended 6 months ended Year ended
US$ million 30.06.11 30.06.10 31.12.10
Profit for the financial period 5,015 2,687 8,119
Net gain on revaluation of
available for sale investments 237 54 316
Net loss on cash flow hedges (64) (78) (14)
Net exchange (loss)/gain on
translation of foreign
operations (including associates) (283) (891) 2,431
Actuarial net (loss)/gain on
post employment benefit schemes (18) (59) 131
Share of associates` net
expense recognised directly in equity (5) (3) (50)
Tax on items recognised
directly in equity (48) 63 (149)
Net (expense)/income
recognised directly in equity (181) (914) 2,665
Transferred to income
statement: sale of available
for sale investments (11) - -
Transferred to income
statement: cash flow hedges 2 2 4
Transferred to initial
carrying amount of hedged
items: cash flow hedges 35 31 20
Transferred to income
statement: exchange
differences on disposal of
foreign operations 42 3 (40)
Share of associates` net
income transferred from equity - - (8)
Tax on items transferred from equity (12) (4) 1
Total transferred from equity 56 32 (23)
Total comprehensive income
for the financial period 4,890 1,805 10,761
Attributable to:
Non-controlling interests 921 545 1,885
Equity shareholders of the Company 3,969 1,260 8,876
Consolidated balance sheet
as at 30 June 2011
US$ million Note 30.06.11 30.06.10 31.12.10
Intangible assets 2,341 2,551 2,316
Property, plant and equipment 41,433 34,703 39,810
Environmental rehabilitation
trusts 385 299 379
Investments in associates 5,301 4,027 4,900
Financial asset investments 3,555 2,918 3,220
Trade and other receivables 340 264 321
Deferred tax assets 534 285 389
Other financial assets
(derivatives) 509 511 465
Other non-current assets 191 103 178
Total non-current assets 54,589 45,661 51,978
Inventories 3,770 3,368 3,604
Trade and other receivables 4,430 3,745 3,731
Current tax assets 270 147 235
Other financial assets
(derivatives) 488 204 377
Cash and cash equivalents 12b 6,805 2,868 6,401
Total current assets 15,763 10,332 14,348
Assets classified as held for
sale 14 - 1,146 330
Total assets 70,352 57,139 66,656
Trade and other payables (5,068) (4,169) (4,950)
Short term borrowings 11,12b (1,061) (3,121) (1,535)
Provisions for liabilities and
charges (318) (224) (446)
Current tax liabilities (749) (536) (871)
Other financial liabilities
(derivatives) (57) (114) (80)
Total current liabilities (7,253) (8,164) (7,882)
Medium and long term borrowings 11,12b (12,497) (10,076) (11,904)
Retirement benefit obligations (566) (705) (591)
Deferred tax liabilities (6,059) (4,989) (5,641)
Other financial liabilities
(derivatives) (508) (1,065) (755)
Provisions for liabilities and
charges (1,747) (1,488) (1,666)
Other non-current liabilities (83) (113) (104)
Total non-current liabilities (21,460) (18,436) (20,661)
Liabilities directly associated
with assets classified as held
for sale 14 - (342) (142)
Total liabilities (28,713) (26,942) (28,685)
Net assets 41,639 30,197 37,971
Equity
Called-up share capital 10 738 738 738
Share premium account 2,714 2,713 2,713
Other reserves 3,548 587 3,642
Retained earnings 30,697 23,324 27,146
Equity attributable to equity
shareholders of the Company 37,697 27,362 34,239
Non-controlling interests 3,942 2,835 3,732
Total equity 41,639 30,197 37,971
The Condensed financial statements of Anglo American plc, registered number
3564138, were approved by the Board of directors on 28 July 2011 and signed on
its behalf by:
Cynthia Carroll Rene Medori
Chief executive Finance director
Consolidated cash flow statement
for the six months ended 30 June 2011
6 months ended 6 months ended Year ended
US$ million Note 30.06.11 30.06.10 31.12.10
Cash flows from
operations 12a 5,233 3,729 9,924
Dividends from
associates 165 72 255
Dividends from
financial asset
investments 32 15 30
Income tax paid (1,444) (1,130) (2,482)
Net cash inflows
from operating
activities 3,986 2,686 7,727
Cash flows from
investing activities
Purchase of
property, plant and
equipment 2 (2,595) (2,065) (5,280)
Cash flows from
derivatives related
to capital
expenditure 2 267 72 286
Investments in
associates (1) (23) (504) (519)
Purchase of
financial asset investments (2) (123) (134)
Net (advance)/repayment
of loans granted (24) (75) 18
Interest received
and other investment income 169 102 235
Disposal of
subsidiaries, net of
cash and cash
equivalents disposed 13 486 130 2,539
Sale of interests in
joint ventures 13 19 30 256
Repayment of
capitalised loans by
associates 2 28 33
Proceeds from disposal
of property, plant and
equipment 33 10 64
Other investing activities (14) (2) 32
Net cash used in
investing activities (1,682) (2,397) (2,470)
Cash flows from
financing activities
Interest paid (424) (425) (837)
Cash flows from
derivatives related
to financing activities 53 238 217
Dividends paid to
Company shareholders (495) - (302)
Dividends paid to
non-controlling interests (686) (225) (617)
Repayment of short
term borrowings (691) (634) (2,338)
Net receipt/(repayment)
of medium and long
term borrowings 457 (79) 1,194
Movements in non-controlling
interests 7 589 356
Sale of shares under
employee share schemes 14 11 42
Purchase of shares
by subsidiaries for
employee share schemes (2) (132) (91) (106)
Other financing
activities (12) - (9)
Net cash used in
financing activities (1,909) (616) (2,400)
Net increase/(decrease)
in cash and cash
equivalents 395 (327) 2,857
Cash and cash
equivalents at start
of period 12c 6,460 3,319 3,319
Cash movements in
the period 395 (327) 2,857
Effects of changes
in foreign exchange rates (50) (36) 284
Cash and cash
equivalents at end
of period 12c 6,805 2,956 6,460
(1) Includes $450 million cash paid, in the six months ended 30 June 2010 and
the year ended 31 December 2010, to subscribe to the Group`s share of De
Beers` rights issue.
(2) Includes purchase of Kumba Iron Ore Limited and Anglo American Platinum
Limited shares for their respective employee share schemes.
Consolidated statement of changes in equity
for the six months ended 30 June 2011
Share- Cumulative
Total based translation
share Retained payment adjustment
capital (1) earnings reserve reserve
US$ million
Balance at 1 January 2010 3,451 21,291 401 (551)
Total comprehensive income - 2,015 - (763)
Dividends paid to
non-controlling interests - - - -
Issue of shares to
non-controlling interests - 90 - -
Consolidation by De Beers
of non-controlling interest - (128) - -
Equity settled
share-based payment schemes - 53 (24) -
Other - 3 (7) -
Balance at 30 June 2010 3,451 23,324 370 (1,314)
Total comprehensive income - 4,580 - 2,767
Dividends paid - (302) - -
Dividends paid to
non-controlling interests - - - -
Issue of shares to
non-controlling interests - - - -
Changes in ownership
interest in subsidiaries - (471) - 21
Equity settled
share-based payment schemes - 11 110 -
Other - 4 (4) -
Balance at 31 December 2010 3,451 27,146 476 1,474
Total comprehensive income - 3,969 - (167)
Dividends paid - (495) - -
Dividends paid to
non-controlling interests - - - -
Issue of shares to
non-controlling interests - - - -
Equity settled
share-based payment schemes - 77 (88) -
Other 1 - (6) -
Balance at 30 June 2011 3,452 30,697 382 1,307
Total equity
attributable
to equity
Fair value shareholders Non-
and other of the controlling Total
reserves Company interests equity
US$ million
Balance at 1 January 2010 1,529 26,121 1,948 28,069
Total comprehensive income 8 1,260 545 1,805
Dividends paid to
non-controlling interests - - (225) (225)
Issue of shares to
non-controlling interests - 90 570 660
Consolidation by De
Beers of non-controlling
interest - (128) - (128)
Equity settled
share-based payment schemes - 29 2 31
Other (6) (10) (5) (15)
Balance at 30 June 2010 1,531 27,362 2,835 30,197
Total comprehensive income 269 7,616 1,340 8,956
Dividends paid - (302) - (302)
Dividends paid to
non-controlling interests - - (392) (392)
Issue of shares to
non-controlling interests - - 2 2
Changes in ownership
interest in subsidiaries (107) (557) (112) (669)
Equity settled
share-based payment schemes - 121 11 132
Other (1) (1) 48 47
Balance at 31 December
2010 1,692 34,239 3,732 37,971
Total comprehensive income 167 3,969 921 4,890
Dividends paid - (495) - (495)
Dividends paid to
non-controlling interests - - (664) (664)
Issue of shares to
non-controlling interests - - 7 7
Equity settled
share-based payment
schemes - (11) (12) (23)
Other - (5) (42) (47)
Balance at 30 June 2011 1,859 37,697 3,942 41,639
(1) Total share capital comprises called-up share capital of $738 million (30
June 2010: $738 million; 31 December 2010: $738 million) and the share premium
account of $2,714 million (30 June 2010: $2,713 million; 31 December 2010:
$2,713 million).
Dividends
6 months ended 6 months ended Year ended
30.06.11 30.06.10 31.12.10
Proposed ordinary dividend
per share (US cents) 28 25 40
Proposed ordinary dividend
(US$ million) 339 302 483
Ordinary dividends paid
during the period per share (US cents) 40 - 25
Ordinary dividends paid
during the period (US$ million) 495 - 302
Notes to the Condensed financial statements
1. Basis of preparation
The Condensed financial statements for the six month period ended 30 June 2011
have been prepared in accordance with International Accounting Standard (IAS)
34 Interim Financial Reporting and the requirements of the Disclosure and
Transparency Rules (DTR) of the Financial Services Authority (FSA) in the
United Kingdom as applicable to interim financial reporting.
The Condensed financial statements represent a `condensed set of financial
statements` as referred to in the DTR issued by the FSA. Accordingly, they do
not include all of the information required for a full annual financial report
and are to be read in conjunction with the Group`s financial statements for
the year ended 31 December 2010, which were prepared in accordance with
International Financial Reporting Standards (IFRS) adopted for use by the
European Union. The financial information for the year ended 31 December 2010
does not constitute statutory accounts as defined in sections 435 (1) and (2)
of the Companies Act 2006. This information was derived from the statutory
accounts for the year ended 31 December 2010, a copy of which has been
delivered to the Registrar of Companies. The auditor`s report on those
accounts was unqualified, did not include a reference to any matters to
which the auditors drew attention by way of emphasis of matter and did not
contain a statement under sections 498 (2) or (3) of the Companies Act 2006.
Accounting policies
The Condensed financial statements have been prepared under the historical
cost convention as modified by the revaluation of pension assets and
liabilities and certain financial instruments.
The accounting policies applied are consistent with those adopted and
disclosed in the Group`s financial statements for the year ended 31 December
2010, with the exception of certain amendments to accounting standards or new
interpretations issued by the International Accounting Standards Board, which
were applicable from 1 January 2011. These have not had a material impact on
the Group.
Going concern
The financial position of the Group, its cash flows, liquidity position and
borrowing facilities are set out in the Financial review of Group results on
pages 11 to 15. The Group`s net debt at 30 June 2011 was $6.8 billion
(including related hedges) (31 December 2010: $7.4 billion) representing a
gearing level of 14.0% (31 December 2010: 16.3%). Further analysis of net debt
is set out in note 12 and details of borrowings and facilities are set out in
note 11.
The directors have considered the Group`s cash flow forecasts for the period
to 31 December 2012. The Board is satisfied that the Group`s forecasts and
projections, taking account of reasonably possible changes in trading
performance show that the Group will be able to operate within the level of
its current facilities for the foreseeable future. For this reason the Group
continues to adopt the going concern basis in preparing the Condensed
financial statements.
Non-GAAP measures
Investors should consider non-GAAP financial measures in addition to, and not
as a substitute for or as superior to, measures of financial performance
reported in accordance with IFRS. The IFRS results reflect all items that
affect reported performance and therefore it is important to consider the IFRS
measures alongside the non-GAAP measures. Reconciliations of key non-GAAP data
to directly comparable IFRS financial measures are presented in notes 2, 5 and
9 to the Condensed financial statements.
2. Segmental information
The Group`s segments are aligned to the structure of business units based
around core commodities. Each business unit has a management team that is
accountable to the Chief executive. The Kumba Iron Ore, Iron Ore Brazil and
Samancor business units have been aggregated as the Iron Ore and Manganese
segment on the basis of the ultimate product produced (ferrous metals).
Assets originally identified for divestment as part of the restructuring
programme announced in October 2009, are managed as a separate business unit,
Other Mining and Industrial, and accordingly presented as a separate segment.
In 2011 the Group decided to retain Catalao, Copebras and Peace River Coal. As
these businesses continued to be managed within the Other Mining and
Industrial business unit during the six month period, they are presented
within Other Mining and Industrial in the segmental analysis.
The Group`s Executive Committee evaluates the financial performance of the
Group and its segments principally with reference to operating profit before
special items and remeasurements which includes the Group`s attributable share
of associates` operating profit before special items and remeasurements.
Segments predominantly derive revenue as follows - Iron Ore and Manganese:
iron ore, manganese ore and alloys; Metallurgical Coal: metallurgical coal;
Thermal
Coal: thermal coal; Copper and Nickel: base metals; Platinum: platinum group
metals; Diamonds: rough and polished diamonds and diamond jewellery; and
Other Mining and Industrial: heavy building materials, steel products,
phosphates, ferroniobium and, until February 2011, zinc.
The Exploration segment includes the cost of the Group`s exploration
activities across all segments, excluding Diamonds.
The segment results are stated after elimination of inter-segment transactions
and include an allocation of corporate costs.
Analysis by segment
Revenue and operating profit
Revenue (1)
6 months ended 6 months ended Year ended
US$ million 30.06.11 30.06.10 31.12.10
Iron Ore and Manganese 4,196 3,005 6,612
Metallurgical Coal 1,812 1,444 3,377
Thermal Coal 1,693 1,317 2,866
Copper 2,609 2,142 4,877
Nickel 293 209 426
Platinum 3,760 2,870 6,602
Diamonds 1,750 1,340 2,644
Other Mining and Industrial 2,179 2,686 5,520
Exploration - - -
Corporate Activities and
Unallocated Costs 2 2 5
Segment measure 18,294 15,015 32,929
Reconciliation:
Less: Associates (3,057) (2,425) (4,969)
Operating special items and
remeasurements - - -
Statutory measure 15,237 12,590 27,960
Operating profit/(loss) (2)
6 months ended 6 months ended Year ended
US$ million 30.06.11 30.06.10 31.12.10
Iron Ore and Manganese 2,507 1,628 3,681
Metallurgical Coal 491 263 783
Thermal Coal 521 351 710
Copper 1,401 1,185 2,817
Nickel 93 68 96
Platinum 542 418 837
Diamonds 450 261 495
Other Mining and Industrial 101 290 661
Exploration (46) (57) (136)
Corporate Activities and
Unallocated Costs (36) (46) (181)
Segment measure 6,024 4,361 9,763
Reconciliation:
Less: Associates (844) (646) (1,255)
Operating special items and
remeasurements 303 (126) 158
Statutory measure 5,483 3,589 8,666
(1) Segment revenue includes the Group`s attributable share of associates`
revenue. This is reconciled to Group revenue from subsidiaries and joint
ventures as presented in the Consolidated income statement.
(2) Segment operating profit is revenue less operating costs before special
items and remeasurements, and includes the Group`s attributable share of
associates` operating profit. This is reconciled to operating profit from
subsidiaries and joint ventures after special items and remeasurements as
presented in the Consolidated income statement.
Associates` revenue and operating profit
Associates` revenue
6 months ended 6 months ended Year ended
30.06.11 30.06.10 31.12.10
US$ million
Iron Ore and
Manganese 491 505 983
Metallurgical Coal 172 103 258
Thermal Coal 507 344 761
Platinum 136 91 237
Diamonds 1,750 1,340 2,644
Other Mining and
Industrial 1 42 86
3,057 2,425 4,969
Reconciliation:
Associates` net
finance costs
Associates` income
tax expense
Associates`
non-controlling
interests
Share of net income
from associates
(before special
items and
remeasurements)
Associates` special
items and
remeasurements
Associates` special
items and
remeasurements tax
Associates`
non-controlling
interests on
special items and
remeasurements
Share of net income
from associates
Associates` operating profit/(loss) (1)
6 months ended 6 months ended Year ended
30.06.11 30.06.10 31.12.10
US$ million
Iron Ore and Manganese 106 209 382
Metallurgical Coal 115 49 122
Thermal Coal 212 143 308
Platinum (39) (19) (59)
Diamonds 450 261 495
Other Mining and Industrial - 3 7
844 646 1,255
Reconciliation:
Associates` net finance costs (26) (56) (88)
Associates` income tax expense (217) (172) (313)
Associates` non-controlling interests (8) (12) (9)
Share of net income from associates
(before special items and
remeasurements) 593 406 845
Associates` special items and
remeasurements 17 (26) (22)
Associates` special items and
remeasurements tax (4) 1 (2)
Associates` non-controlling
interests on special items and
remeasurements (1) 3 1
Share of net income from associates 605 384 822
(1) Associates` operating profit is the Group`s attributable share of
associates` revenue less operating costs before special items and
remeasurements.
Non-cash items
Significant non-cash items included within operating profit before special
items and remeasurements are as follows:
Depreciation and amortisation (1)
6 months ended 6 months ended Year ended
30.06.11 30.06.10 31.12.10
US$ million
Iron Ore and Manganese 89 66 142
Metallurgical Coal 165 148 322
Thermal Coal 65 58 113
Copper 126 127 269
26
Nickel 13 13
Platinum 364 358 750
Other Mining and Industrial 109 137 251
Exploration - - -
Corporate Activities and
Unallocated Costs 18 12 46
(3) (3) (3)
949 919 1,919
Other non-cash expenses (2)
6 months ended 6 months ended Year ended
30.06.11 30.06.10 31.12.10
US$ million
Iron Ore and Manganese 63 38 90
Metallurgical Coal 39 2 75
Thermal Coal 13 14 40
Copper 49 43 97
Nickel 2 2 23
Platinum 36 56 57
Other Mining and Industrial 3 19 16
Exploration 1 2 4
Corporate Activities and
Unallocated Costs 24 30 61
230 206 463
(1) The Group`s attributable share of depreciation and amortisation in
associates is $139 million (six months ended 30 June 2010: $134 million; year
ended 31 December 2010: $301 million) and is split by segment as follows: Iron
Ore and Manganese $15 million (six months ended 30 June 2010: $17 million;
year ended 31 December 2010: $33 million), Metallurgical Coal $7 million (six
months ended 30 June 2010: $5 million; year ended 31 December 2010: $11
million), Thermal Coal $25 million (six months ended 30 June 2010: $24
million; year ended 31 December 2010: $49 million), Platinum $25 million (six
months ended
30 June 2010: $9 million; year ended 31 December 2010: $37 million) and
Diamonds $67 million (six months ended 30 June 2010: $79 million; year ended
31 December 2010: $171 million).
(2) Other non-cash expenses include equity settled share-based payment charges
and amounts included in operating costs in respect of provisions, excluding
amounts recorded within special items.
(3) In addition $42 million (six months ended 30 June 2010: $36 million; year
ended 31 December 2010: $97 million) of accelerated depreciation has been
recorded within operating special items (see note 4).
Capital expenditure and net debt
Capital expenditure (1)
6 months ended 6 months ended Year ended
US$ million 30.06.11 30.06.10 31.12.10
Iron Ore and Manganese 595 467 1,195
Metallurgical Coal 206 21 217
Thermal Coal 31 140 274
Copper 831 601 1,530
Nickel 177 223 525
Platinum 410 431 1,011
Other Mining and Industrial 72 104 224
Exploration - - -
Corporate Activities and
Unallocated Costs 6 6 18
2,328 1,993 4,994
Reconciliation:
Remove: Cash flows from
derivatives relating
to capital expenditure 267 72 286
Purchase of property, plant
and equipment 2,595 2,065 5,280
Interest capitalised 152 113 247
Non-cash movements (3) 30 5 305
Property, plant and equipment
additions (4) 2,777 2,183 5,832
Amounts related to disposal groups (2) (19) (46)
2,775 2,164 5,786
Net debt (2)
US$ million 30.06.11 30.06.10 31.12.10
Iron Ore and Manganese 689 246 89
Metallurgical Coal (601) (42) (615)
Thermal Coal 28 74 (50)
Copper (562) (396) (243)
Nickel 547 481 561
Platinum (77) (53) (65)
Other Mining and Industrial 437 394 365
Exploration (2) (1) (2)
Corporate Activities and Unallocated
Costs 6,335 10,315 7,403
6,794 11,018 7,443
Reconciliation:
Remove: Cash flows from derivatives
relating to capital expenditure
Purchase of property, plant and equipment
Interest capitalised
Non-cash movements (3)
Property, plant and equipment additions (4)
Amounts related to disposal groups - (88) (59)
6,794 10,930 7,384
(1) Capital expenditure is segmented on a cash basis and is reconciled to
balance sheet additions. Cash capital expenditure includes cash flows on
related derivatives.
(2) Segment net debt includes related hedges and excludes net debt in disposal
groups. For a reconciliation of net debt to the balance sheet see note 12b.
(3) Includes movements on capital expenditure accruals, movements relating to
deferred stripping and the impact of realised cash flow hedges.
(4) Capital expenditure on an accruals basis is split by segment as follows:
Iron Ore and Manganese $859 million (30 June 2010: $503 million; 31 December
2010: $1,536 million), Metallurgical Coal $186 million (30 June 2010: $57
million; 31 December 2010: $297 million), Thermal Coal $37 million (30 June
2010: $140 million; 31 December 2010: $297 million), Copper $975 million (30
June 2010: $700 million; 31 December 2010: $1,820 million), Nickel $201
million (30 June 2010: $272 million; 31 December 2010: $602 million), Platinum
$445 million (30 June 2010: $417 million; 31 December 2010: $1,043 million),
Other
Mining and Industrial $68 million (30 June 2010: $88 million; 31 December
2010: $216 million), Exploration nil (30 June 2010: nil; 31 December 2010:
$1 million) and Corporate Activities and Unallocated Costs $6 million (30
June 2010: $6 million; 31 December 2010: $20 million).
Segment assets and liabilities
The following balance sheet segment measures are provided for information:
Segment assets (1)
US$ million 30.06.11 30.06.10 31.12.10
Iron Ore and Manganese 13,451 11,073 12,333
Metallurgical Coal 5,353 4,020 4,711
Thermal Coal 2,864 2,395 2,897
Copper 8,112 5,938 7,300
Nickel 2,630 2,096 2,443
Platinum 14,408 13,131 14,701
Other Mining and Industrial 4,898 5,332 4,596
Exploration 4 4 3
Corporate Activities and Unallocated
Costs 405 278 402
Other assets and liabilities 52,125 44,267 49,386
Investments in associates (3) 5,301 4,027 4,900
Financial asset investments 3,555 2,918 3,220
Deferred tax assets/(liabilities) 534 285 389
Other financial assets/(liabilities) -
derivatives 997 715 842
Cash and cash equivalents 6,805 2,868 6,401
Other non-operating assets/(liabilities) 1,035 2,059 1,518
Borrowings - - -
Other provisions - - -
Net assets 70,352 57,139 66,656
Segment liabilities (2)
US$ million 30.06.11 30.06.10 31.12.10
Iron Ore and Manganese (574) (394) (632)
Metallurgical Coal (1,090) (848) (793)
Thermal Coal (784) (655) (786)
Copper (1,062) (786) (1,009)
Nickel (104) (108) (109)
Platinum (1,150) (962) (1,223)
Other Mining and Industrial (850) (1,119) (789)
Exploration (6) (1) (12)
Corporate Activities and Unallocated
Costs (363) (254) (377)
Other assets and liabilities (5,983) (5,127) (5,730)
Investments in associates (3) - - -
Financial asset investments - - -
Deferred tax assets/(liabilities) (6,059) (4,989) (5,641)
Other financial assets/(liabilities) -
derivatives (565) (1,179) (835)
Cash and cash equivalents - - -
Other non-operating assets/(liabilities) (1,841) (1,844) (2,233)
Borrowings (13,558) (13,197) (13,439)
Other provisions (707) (606) (807)
Net assets (28,713) (26,942) (28,685)
Net segment assets/(liabilities)
US$ million 30.06.11 30.06.10 31.12.10
Iron Ore and Manganese 12,877 10,679 11,701
Metallurgical Coal 4,263 3,172 3,918
Thermal Coal 2,080 1,740 2,111
Copper 7,050 5,152 6,291
Nickel 2,526 1,988 2,334
Platinum 13,258 12,169 13,478
Other Mining and Industrial 4,048 4,213 3,807
Exploration (2) 3 (9)
Corporate Activities and Unallocated
Costs 42 24 25
Other assets and liabilities 46,142 39,140 43,656
Investments in associates (3) 5,301 4,027 4,900
Financial asset investments 3,555 2,918 3,220
Deferred tax assets/(liabilities) (5,525) (4,704) (5,252)
Other financial assets/(liabilities) -
derivatives 432 (464) 7
Cash and cash equivalents 6,805 2,868 6,401
Other non-operating assets/(liabilities) (806) 215 (715)
Borrowings (13,558) (13,197) (13,439)
Other provisions (707) (606) (807)
Net assets 41,639 30,197 37,971
(1) Segment assets at 30 June 2011 are operating assets and consist of
intangible assets of $2,341 million (30 June 2010: $2,551 million; 31 December
2010: $2,316 million), property, plant and equipment of $41,433 million (30
June 2010: $34,703 million; 31 December 2010: $39,810 million), biological
assets of $4 million (30 June 2010: $3 million; 31 December 2010: $2 million),
environmental rehabilitation trusts of $385 million (30 June 2010: $299
million; 31 December 2010: $379 million), retirement benefit assets of $127
million (30 June 2010: $41 million; 31 December 2010: $112 million),
inventories of $3,770 million (30 June 2010: $3,368 million; 31 December
2010: $3,604 million) and operating receivables of $4,065 million (30 June
2010: $3,302 million; 31 December 2010: $3,163 million).
(2) Segment liabilities at 30 June 2011 are operating liabilities and consist
of non-interest bearing current liabilities of $4,059 million (30 June 2010:
$3,316 million; 31 December 2010: $3,834 million), restoration and
decommissioning provisions of $1,358 million (30 June 2010: $1,106 million;
31 December 2010: $1,305 million) and retirement benefit obligations of
$566 million (30 June 2010: $705 million; 31 December 2010: $591 million).
(3) Investments in associates are split by segment as follows: Iron Ore and
Manganese $925 million (30 June 2010: $813 million; 31 December 2010: $880
million), Metallurgical Coal $284 million (30 June 2010: $156 million; 31
December 2010: $223 million), Thermal Coal $837 million (30 June 2010: $740
million; 31 December 2010: $749 million), Platinum $1,021 million (30 June
2010: $516 million; 31 December 2010: $1,112 million), Diamonds $2,234 million
(30 June 2010: $1,783 million; 31 December 2010: $1,936 million) and Other
Mining and Industrial nil (30 June 2010: $19 million; 31 December 2010: nil).
Revenue by product
The Group`s analysis of segment revenue by product (including attributable
share of revenue from associates) is as follows:
6 months ended 6 months ended Year ended
30.06.11 30.06.10 31.12.10
US$ million
Iron ore 3,535 2,282 5,234
Manganese ore and alloys 491 505 983
Metallurgical coal 1,497 1,128 2,711
Thermal coal 2,136 1,721 3,707
Copper 2,536 2,085 4,782
Nickel 567 414 824
Platinum 2,251 1,706 4,053
Palladium 561 278 697
Rhodium 395 367 782
Diamonds 1,750 1,340 2,644
Heavy building materials 1,197 1,254 2,376
Steel products 483 760 1,568
Zinc 37 291 584
Other 858 884 1,984
18,294 15,015 32,929
Geographical analysis
Revenue by destination and non-current segment assets by location
The Group`s geographical analysis of segment revenue (including attributable
share of revenue from associates) allocated based on the country in which the
customer is located, and non-current segment assets, allocated based on the
country in which the assets are located, is as follows:
Revenue
6 months ended 6 months ended (2) Year ended
US$ million 30.06.11 30.06.10 31.12.10
South Africa 1,799 1,571 3,307
Other Africa 321 246 502
Brazil 571 496 1,135
Chile 1,143 799 1,940
Other South America 38 106 207
North America 1,040 858 1,805
Australia 200 226 474
China 3,109 2,398 5,075
India 1,084 924 2,021
Japan 2,381 1,805 4,198
Other Asia 1,624 1,358 2,818
United Kingdom (Anglo
American plc`s country of
domicile) 1,952 1,592 3,980
Other Europe 3,032 2,636 5,467
18,294 15,015 32,929
Non-current segment assets (1)
US$ million 30.06.11 30.06.10 31.12.10
South Africa 17,194 14,807 17,389
Other Africa 390 309 373
Brazil 11,957 10,208 11,159
Chile 6,358 4,763 5,628
Other South America 645 602 589
North America 569 709 540
Australia 4,219 3,293 4,022
China 5 4 5
India - - -
Japan - - -
Other Asia 38 45 42
United Kingdom (Anglo American plc`s
country of domicile) 2,348 2,455 2,331
Other Europe 51 59 48
43,774 37,254 42,126
(1) Non-current segment assets are non-current operating assets and consist of
intangible assets and property, plant and equipment.
(2) Comparatives have been reclassified to align with current presentation.
Revenue and operating profit by origin
Segment revenue and operating profit before special items and remeasurements
by origin (including attributable share of revenue and operating profit from
associates) has been provided for information:
Revenue
6 months ended 6 months ended Year ended
US$ million 30.06.11 30.06.10 31.12.10
South Africa 9,099 6,849 15,711
Other Africa 1,440 1,216 2,329
South America 3,956 3,280 7,492
North America 271 329 679
Australia and Asia 2,319 2,006 4,141
Europe 1,209 1,335 2,577
18,294 15,015 32,929
Operating profit/(loss) before special items and remeasurements
6 months ended 6 months ended Year ended
US$ million 30.06.11 30.06.10 31.12.10
South Africa 3,322 2,190 5,001
Other Africa 371 265 501
South America 1,777 1,452 3,416
North America 72 47 14
Australia and Asia 603 429 911
Europe (121) (22) (80)
6,024 4,361 9,763
Segment assets and liabilities by location
The Group`s geographical analysis of segment assets and liabilities, allocated
based on where assets and liabilities are located, has been provided for
information:
Segment assets (1)
US$ million 30.06.11 30.06.10 31.12.10
South Africa 20,746 18,495 21,294
Other Africa 393 314 377
South America 20,632 16,920 18,982
North America 640 865 611
Australia and Asia 6,014 4,140 4,849
Europe 3,700 3,533 3,273
52,125 44,267 49,386
Segment liabilities
US$ million 30.06.11 30.06.10 31.12.10
South Africa (2,717) (2,186) (2,815)
Other Africa (37) (34) (26)
South America (1,396) (1,115) (1,384)
North America (46) (117) (38)
(1,158) (888) (851)
Australia and Asia
Europe (629) (787) (616)
(5,983) (5,127) (5,730)
Net segment assets
US$ million 30.06.11 30.06.10 31.12.10
South Africa 18,029 16,309 18,479
Other Africa 356 280 351
South America 19,236 15,805 17,598
North America 594 748 573
4,856 3,252 3,998
Australia and Asia
Europe 3,071 2,746 2,657
46,142 39,140 43,656
(1) Investments in associates of $5,301 million (30 June 2010: $4,027 million;
31 December 2010: $4,900 million) are not included in segment assets. The
geographical distribution of these investments, based on the location of the
underlying assets, is as follows: South Africa $2,233 million (30 June 2010:
$1,868 million; 31 December 2010: $2,334 million), Other Africa $1,043 million
(30 June 2010: $1,030 million; 31 December 2010: $1,220 million), South
America $817 million (30 June 2010: $722 million; 31 December 2010: $729
million), North America $342 million (30 June 2010: $422 million; 31 December
2010: $376 million), Australia and Asia $788 million (30 June 2010: $470
million; 31 December 2010: $698 million) and Europe $78 million (30 June 2010:
$(485) million; 31 December 2010: $(457) million).
3. Operating profit and underlying earnings by segment
The following tables analyse operating profit (including attributable share of
associates` operating profit) for the financial period by segment and
reconciles it to underlying earnings by segment. Underlying earnings is an
alternative earnings measure which the directors consider to be a useful
additional measure of the Group`s performance. Underlying earnings is profit
for the financial period attributable to equity shareholders of the Company
before special items and remeasurements and is therefore presented after non-
controlling interests. A reconciliation from `Profit for the financial period
attributable to equity shareholders of the Company` to `Underlying earnings
for the financial period` is provided in note 9.
Operating Operating Operating
profit/(loss) before profit/(loss) after special items and
special items and special items and remeasurements
US$ million remeasurements (1) remeasurements (note 4)
Iron Ore and
Manganese 2,507 2,792 (285)
Metallurgical Coal 491 491 -
Thermal Coal 521 519 2
Copper 1,401 1,406 (5)
Nickel 93 89 4
Platinum 542 563 (21)
Diamonds 450 458 (8)
Exploration (46) (46) -
Corporate
Activities and
Unallocated Costs (36) (38) 2
Core operations 5,923 6,234 (311)
Other
Mining and Industrial 101 101 -
6,024 6,335 (311)
6 months ended 30.06.11
Net interest, tax
and non-
controlling Underlying
US$ million interests earnings
Iron Ore and Manganese (1,605) 902
Metallurgical Coal (140) 351
Thermal Coal (136) 385
Copper (559) 842
Nickel (35) 58
Platinum (257) 285
Diamonds (151) 299
Exploration 1 (45)
Corporate Activities and Unallocated Costs 17 (19)
Core operations (2,865) 3,058
Other Mining and Industrial (39) 62
(2,904) 3,120
Operating Operating Operating
profit/(loss) before profit/(loss) after special items and
special items and special items and remeasurements
US$ million remeasurements (1) remeasurements (note 4)
Iron Ore
and Manganese 1,628 1,623 5
Metallurgical Coal 263 281 (18)
Thermal Coal 351 350 1
Copper 1,185 1,154 31
Nickel 68 31 37
Platinum 418 393 25
Diamonds 261 242 19
Exploration (57) (57) -
Corporate
Activities
and Unallocated
Costs (46) (47) 1
Core operations 4,071 3,970 101
Other
Mining and Industrial 290 246 44
4,361 4,216 145
6 months ended 30.06.10
Net interest, tax
and non-
controlling Underlying
US$ million interests earnings
Iron Ore and Manganese (1,014) 614
Metallurgical Coal (86) 177
Thermal Coal (93) 258
Copper (479) 706
Nickel (4) 64
Platinum (196) 222
Diamonds (113) 148
Exploration 2 (55)
Corporate Activities and Unallocated Costs (94) (140)
Core operations (2,077) 1,994
Other Mining and Industrial (72) 218
(2,149) 2,212
Operating Operating Operating
profit/(loss) before profit/(loss) after special items and
special items and special items and remeasurements
remeasurements (1) remeasurements (note 4)
US$ million
Iron Ore
and Manganese 3,681 4,037 (356)
Metallurgical Coal 783 806 (23)
Thermal Coal 710 708 2
Copper 2,817 2,832 (15)
Nickel 96 45 51
Platinum 837 765 72
Diamonds 495 466 29
Exploration (136) (136) -
Corporate
Activities
and Unallocated
Costs (181) (192) 11
Core operations 9,102 9,331 (229)
Other
Mining and Industrial 661 561 100
9,763 9,892 (129)
Year ended 31.12.10
Net interest, tax
and non-
controlling Underlying
interests earnings
US$ million
Iron Ore and Manganese (2,258) 1,423
Metallurgical Coal (198) 585
Thermal Coal (198) 512
Copper (1,096) 1,721
Nickel (21) 75
Platinum (412) 425
Diamonds (193) 302
Exploration 8 (128)
Corporate Activities and Unallocated Costs (280) (461)
Core operations (4,648) 4,454
Other Mining and Industrial (139) 522
(4,787) 4,976
(1) Operating profit includes attributable share of associates` operating
profit which is reconciled to `Share of net income from associates` in note 2.
Underlying earnings by origin
6 months ended 6 months ended Year ended
30.06.11 30.06.10 31.12.10
US$ million
South Africa 1,503 989 2,218
Other Africa 246 191 350
South America 1,110 910 2,154
North America 57 32 (12)
Australia and Asia 456 288 668
Europe (252) (198) (402)
3,120 2,212 4,976
4. Special items and remeasurements
Special items are those items of financial performance that the Group believes
should be separately disclosed on the face of the income statement to assist
in the understanding of the underlying financial performance achieved by the
Group. Such items are material by nature or amount to the period`s results and
require separate disclosure in accordance with IAS 1 (Revised) Presentation of
Financial Statements paragraph 97. Special items that relate to the operating
performance of the Group are classified as operating special items and include
impairment charges and reversals and other exceptional items, including
restructuring costs. Non-operating special items include profits and losses on
disposals of investments and businesses as well as certain adjustments
relating to business combinations.
Remeasurements comprise other items which the Group believes should be
reported separately to aid an understanding of the underlying financial
performance of the Group. This category includes:
- unrealised gains and losses on `non-hedge` derivative instruments open at
the period end (in respect of future transactions) and the reversal of the
historical marked to market value of such instruments settled in the period.
Where the underlying transaction is recorded in the income statement, the
realised gains or losses are recorded in underlying earnings in the same
period as the underlying transaction for which such instruments provide an
economic, but not formally designated, hedge. If the underlying transaction is
recorded in the balance sheet, e.g. capital expenditure, the realised
amount remains in remeasurements on settlement of the derivative. Such
amounts are classified in the income statement as operating when the
underlying exposure is in respect of the operating performance of the Group
and otherwise as financing.
- foreign exchange impact arising in US dollar functional currency entities
where tax calculations are generated based on local currency financial
information and hence deferred tax is susceptible to currency fluctuations.
Such amounts are included within income tax expense.
6 months ended 30.06.11
Subsidiaries
and joint
US$ million ventures Associates (2) Total
Impairment and related charges (15) - (15)
Restructuring costs (10) - (10)
Operating special items (25) - (25)
Operating remeasurements 328 8 336
Operating special items and
remeasurements 303 8 311
Disposal of Lisheen and
Black Mountain 397 - 397
Disposal of Moly-Cop and
AltaSteel - - -
Gain on Bafokeng-Rasimone
Platinum mine transaction - - -
Disposal of undeveloped coal
assets - - -
Disposal of Skorpion - - -
Disposals of Tarmac businesses - - -
Other 20 6 26
Net profit/(loss) on disposals (3) 417 6 423
Financing special items - - -
Financing remeasurements 46 3 49
Total special items and
remeasurements before tax
and non-controlling interests 766 17 783
Special items and remeasurements tax 140 (4) 136
Non-controlling interests on special
items and remeasurements (50) (1) (51)
Net total special items and
remeasurements attributable
to equity shareholders of the Company 856 12 868
6 months ended 30.06.10 (1)
Subsidiaries
and joint
US$ million ventures Associates (2) Total
Impairment and related charges (32) (11) (43)
Restructuring costs (61) - (61)
Operating special items (93) (11) (104)
Operating remeasurements (33) (8) (41)
Operating special items and
remeasurements (126) (19) (145)
Disposal of Lisheen and
Black Mountain - - -
Disposal of Moly-Cop and
AltaSteel - - -
Gain on Bafokeng-Rasimone
Platinum mine transaction - - -
Disposal of undeveloped coal assets - - -
Disposal of Skorpion - - -
Disposals of Tarmac businesses (81) - (81)
Other (11) 4 (7)
Net profit/(loss) on disposals (3) (92) 4 (88)
Financing special items - (13) (13)
Financing remeasurements 152 2 154
Total special items and
remeasurements before tax
and non-controlling interests (66) (26) (92)
Special items and remeasurements tax (57) 1 (56)
Non-controlling interests on special
items and remeasurements (6) 3 (3)
Net total special items and
remeasurements attributable
to equity shareholders of the Company (129) (22) (151)
Year ended 31.12.10
Subsidiaries
and joint
US$ million ventures Associates (2) Total
Impairment and related charges (107) (15) (122)
Restructuring costs (121) (10) (131)
Operating special items (228) (25) (253)
Operating remeasurements 386 (4) 382
Operating special items and
remeasurements 158 (29) 129
Disposal of Lisheen and
Black Mountain - - -
Disposal of Moly-Cop and
AltaSteel 555 - 555
Gain on Bafokeng-Rasimone
Platinum mine transaction 546 - 546
Disposal of undeveloped coal assets 505 - 505
Disposal of Skorpion 244 - 244
Disposals of Tarmac businesses (294) - (294)
Other 23 19 42
Net profit/(loss) on disposals (3) 1,579 19 1,598
Financing special items - (13) (13)
Financing remeasurements 105 1 106
Total special items and
remeasurements before tax
and non-controlling interests 1,842 (22) 1,820
Special items and remeasurements tax (110) (2) (112)
Non-controlling interests on special
items and remeasurements (141) 1 (140)
Net total special items and
remeasurements attributable
to equity shareholders of the Company 1,591 (23) 1,568
(1) Presentation of special items and remeasurements has been simplified.
Comparatives have been reclassified to align with current presentation.
(2) Relates to the Diamonds segment.
(3) Of this, $397 million (six months ended 30 June 2010: $25 million; year
ended 31 December 2010: $1,246 million) relates to disposals of subsidiaries
and consolidated businesses and nil (six months ended 30 June 2010: nil; year
ended 31 December 2010: $440 million) relates to fair value gains on retained
investments (see note 13).
Subsidiaries` and joint ventures` special items and remeasurements
Operating special items
Impairment and related charges of $15 million in the six months ended 30 June
2011 (six months ended 30 June 2010: $32 million; year ended 31 December 2010:
$107 million) principally relate to accelerated depreciation of $42 million
(six months ended 30 June 2010: $36 million; year ended 31 December 2010: $97
million), mainly arising at Loma de Niquel, partially offset by the reversal
of a provision recorded as part of a previous impairment. The accelerated
depreciation charge at Loma de Niquel has arisen due to ongoing uncertainty
over the renewal of three concessions that expire in 2012 and over the
restoration of 13 concessions that have been cancelled.
Restructuring costs principally relate to retrenchment and consultancy costs
within the Platinum segment (2010: Other Mining and Industrial and Platinum
segments).
Operating remeasurements
Operating remeasurements reflect a net gain of $328 million (six months ended
30 June 2010: loss of $33 million; year ended 31 December 2010: gain of $386
million) principally in respect of non-hedge derivatives of capital
expenditure in Iron Ore Brazil. Derivatives which have been realised during
the period resulted in a net operating remeasurement gain since their
inception of $224 million (six months ended 30 June 2010: gain of $69 million;
year ended 31 December 2010: gain of $255 million).
Profit on disposals
In February 2011 the Group completed the disposal of its 100% interest in the
Lisheen zinc mine (Lisheen) and its 74% interest in Black Mountain Mining
(Proprietary) Limited (Black Mountain), which holds 100% of the Black Mountain
mine and the Gamsberg project, resulting in a net cash inflow of $499 million,
generating a profit on disposal of $397 million. Lisheen and Black Mountain
were included in the Other Mining and Industrial segment.
Financing remeasurements
Financing remeasurements reflect a net gain of $46 million (six months ended
30 June 2010: gain of $152 million; year ended 31 December 2010: gain of $105
million) and relate to an embedded interest rate derivative, non-hedge
derivatives of debt and other financing remeasurements.
Special items and remeasurements tax
Special items and remeasurements tax amounted to a credit of $140 million (six
months ended 30 June 2010: charge of $57 million; year ended 31 December 2010:
charge of $110 million). This relates to a credit for one-off tax items of
$154 million (six months ended 30 June 2010: nil; year ended 31 December 2010:
nil), a tax remeasurement credit of $126 million (six months ended 30 June
2010: charge of $62 million; year ended 31 December 2010: credit of $122
million) and a tax charge on special items and remeasurements of $140 million
(six months ended 30 June 2010: credit of $5 million; year ended 31 December
2010: charge of $232 million).
One-off tax items principally relate to the recognition of deferred tax assets
in Iron Ore Brazil which were originally written off as part of the impairment
charges related to the Amapa iron ore system in 2009, and a capital gains tax
refund related to a prior year disposal.
5. EBITDA
Earnings before interest, tax, depreciation and amortisation (EBITDA) is
operating profit before special items and remeasurements, depreciation and
amortisation in subsidiaries and joint ventures and includes attributable
share of EBITDA of associates.
6 months ended 6 months ended Year ended
US$ million 30.06.11 30.06.10 31.12.10
By segment
Iron Ore and Manganese 2,611 1,711 3,856
Metallurgical Coal 663 416 1,116
Thermal Coal 611 433 872
Copper 1,527 1,312 3,086
Nickel 106 81 122
Platinum 931 785 1,624
Diamonds 517 340 666
Other Mining and Industrial 210 427 912
Exploration (46) (57) (136)
Corporate Activities and
Unallocated Costs (18) (34) (135)
EBITDA 7,112 5,414 11,983
EBITDA is reconciled to operating profit, including attributable share of
associates, before special items and remeasurements and to `Total profit from
operations and associates` as follows:
6 months ended 6 months ended Year ended
US$ million 30.06.11 30.06.10 31.12.10
Total profit from operations
and associates 6,505 3,881 11,067
Operating special items and
remeasurements (including associates) (311) 145 (129)
Net (profit)/loss on
disposals (including associates) (423) 88 (1,598)
Associates` financing special
items and remeasurements (3) 11 12
Share of associates` interest, tax
and non-controlling interests 256 236 411
Operating profit, including
associates, before special
items and remeasurements 6,024 4,361 9,763
Depreciation and
amortisation: subsidiaries
and joint ventures 949 919 1,919
Depreciation and
amortisation: associates 139 134 301
EBITDA 7,112 5,414 11,983
EBITDA is reconciled to `Cash
flows from operations` as
follows:
6 months ended 6 months ended Year ended
US$ million 30.06.11 30.06.10 31.12.10
EBITDA 7,112 5,414 11,983
Share of operating profit of
associates before special
items and remeasurements (844) (646) (1,255)
Cash element of operating
special items (31) (44) (94)
Share of associates`
depreciation and amortisation (139) (134) (301)
Share-based payment charges 115 103 219
Provisions (116) 59 (37)
Increase in inventories (176) (386) (309)
Increase in operating
receivables (725) (671) (587)
Increase in operating payables 119 140 516
Deferred stripping (78) (100) (196)
Other adjustments (4) (6) (15)
Cash flows from operations 5,233 3,729 9,924
6. Exploration expenditure
6 months ended 6 months ended Year ended
US$ million 30.06.11 30.06.10 31.12.10
By commodity
Iron ore 1 3 14
Metallurgical coal 1 3 3
Thermal coal 4 9 21
Copper 10 8 19
Nickel 9 10 27
Platinum group metals 2 4 11
Zinc - 3 3
Central exploration activities 19 17 38
7. Net finance income/(costs)
Finance costs and exchange gains/(losses) are presented net of hedges for
respective interest bearing and foreign currency borrowings.
The weighted average capitalisation rate applied to qualifying capital
expenditure was 4.4% (six months ended 30 June 2010: 5.5%; year ended 31
December 2010: 4.8%).
6 months ended 6 months ended Year ended
US$ million 30.06.11 30.06.10 31.12.10
Investment income
Interest and other financial income 220 159 342
Expected return on defined
benefit arrangement assets 100 104 205
Dividend income from
financial asset investments 32 15 30
352 278 577
Less: Interest capitalised (12) (5) (9)
Total investment income 340 273 568
Interest expense
Interest and other finance expense (305) (314) (632)
Interest payable on
convertible bond (34) (34) (68)
Unwinding of discount on
convertible bond (34) (31) (65)
Interest cost on defined
benefit arrangements (103) (112) (219)
Unwinding of discount
relating to provisions and
other non-current liabilities (36) (30) (73)
(512) (521) (1,057)
Less: Interest capitalised 164 118 256
Total interest expense (348) (403) (801)
Other financing gains/(losses)
Net foreign exchange gains 32 20 17
Net fair value gains/(losses)
on fair value hedges 1 3 (7)
Other net fair value losses (5) (23) (21)
Total other financing gains/(losses) 28 - (11)
Net finance income/(costs)
before remeasurements 20 (130) (244)
Remeasurements
Net gain on embedded and
non-hedge derivatives 22 128 72
Foreign exchange gain/(loss)
on De Beers preference shares - 3 (9)
Other remeasurements 24 21 42
Total remeasurements 46 152 105
Net finance income/(costs)
after remeasurements 66 22 (139)
8. Income tax expense
a) Analysis of charge for the period
6 months ended 6 months ended Year ended
US$ million 30.06.11 30.06.10 31.12.10
United Kingdom corporation
tax at 26.5% (2010: 28%) 8 19 24
South Africa tax 721 473 1,199
Other overseas tax 608 625 1,333
Prior year adjustments (61) (26) (7)
Current tax 1,276 1,091 2,549
Deferred tax 420 68 150
Income tax expense before
special items and remeasurements 1,696 1,159 2,699
Special items and
remeasurements tax (140) 57 110
Income tax expense 1,556 1,216 2,809
b) Factors affecting tax charge for the period
The effective tax rate for the period of 23.7% (six months ended 30 June 2010:
31.2%; year ended 31 December 2010: 25.7%) is lower (six months ended 30 June
2010: higher; year ended 31 December 2010: lower) than the applicable weighted
average statutory rate of corporation tax in the United Kingdom of 26.5% (six
months ended 30 June 2010: 28%; year ended 31 December 2010: 28%). The
reconciling items are:
6 months ended 6 months ended Year ended
US$ million 30.06.11 30.06.10 31.12.10
Profit on ordinary activities
before tax 6,571 3,903 10,928
Less: Share of net income
from associates (605) (384) (822)
Group profit on ordinary
activities before tax 5,966 3,519 10,106
Tax on profit on ordinary
activities calculated at
United Kingdom corporation
tax rate of 26.5% (2010: 28%) 1,581 985 2,830
Tax effects of:
Special items and remeasurements (343) 75 (406)
Items not taxable/deductible
for tax purposes
Exploration expenditure 10 10 13
Non-deductible/taxable net
foreign exchange loss/(gain) 6 5 (3)
Non-taxable/deductible net
interest (income)/expense (19) (4) 2
Other non-deductible expenses 72 62 125
Other non-taxable income (27) (19) (40)
Temporary difference adjustments
Movements in tax losses (5) (7) (50)
Enhanced tax depreciation - - (41)
Other temporary differences (13) 15 (69)
Other adjustments
Secondary tax on companies
and dividend withholding taxes 328 265 657
Effect of differences between
local and United Kingdom rates (1) (139) (218)
Prior year adjustments to current tax (61) (26) (7)
Other adjustments 28 (6) 16
Income tax expense 1,556 1,216 2,809
IAS 1 (Revised) requires income from associates to be presented net of tax on
the face of the income statement. Associates` tax is therefore not included
within the Group`s income tax expense. Associates` tax included within `Share
of net income from associates` for the six months ended 30 June 2011 is $221
million (six months ended 30 June 2010: $171 million; year ended 31 December
2010: $315 million). Excluding special items and remeasurements this becomes
$217 million (six months ended 30 June 2010: $172 million; year ended 31
December 2010: $313 million).
The effective rate of tax before special items and remeasurements including
attributable share of associates` tax for the six months ended 30 June 2011
was 31.8%. This was in line with the equivalent effective rate of 31.9% in the
six months ended 30 June 2010 and in the year ended 31 December 2010. In
future periods it is expected that the effective tax rate, including
associates` tax, will remain above the United Kingdom statutory tax rate.
9. Earnings per share
6 months ended 6 months ended Year ended
US$ 30.06.11 30.06.10 31.12.10
Profit for the financial
period attributable to equity
shareholders of the Company
Basic earnings per share 3.30 1.71 5.43
Diluted earnings per share 3.15 1.65 5.18
Headline earnings for the
financial period (1)
Basic earnings per share 2.96 1.74 4.27
Diluted earnings per share 2.84 1.68 4.09
Underlying earnings for the
financial period (1)
Basic earnings per share 2.58 1.84 4.13
Diluted earnings per share 2.47 1.76 3.96
(1) Basic and diluted earnings per share are shown based on headline earnings,
a Johannesburg Stock Exchange (JSE Limited) defined performance measure, and
underlying earnings, which the directors consider to be a useful additional
measure of the Group`s performance. Both earnings measures are further
explained below.
The calculation of basic and diluted earnings per share is based on the
following data:
6 months ended 6 months ended Year ended
US$ million (unless otherwise
stated) 30.06.11 30.06.10 31.12.10
Earnings
Basic earnings, being profit
for the financial period
attributable to equity
shareholders of the Company 3,988 2,061 6,544
Effect of dilutive potential
ordinary shares
Interest payable on
convertible bond (net of tax) 25 24 49
Unwinding of discount on
convertible bond (net of tax) 25 22 47
Diluted earnings 4,038 2,107 6,640
Number of shares (million)
Basic number of ordinary
shares outstanding (1) 1,209 1,205 1,206
Effect of dilutive potential
ordinary shares (2)
Share options and awards 10 14 14
Convertible bond 62 61 61
Diluted number of ordinary
shares outstanding (1) 1,281 1,280 1,281
(1) Basic and diluted number of ordinary shares outstanding represent the
weighted average for the period. The average number of ordinary shares in
issue excludes shares held by employee benefit trusts and Anglo American plc
shares held by Group companies.
(2) Diluted earnings per share is calculated by adjusting the weighted average
number of ordinary shares in issue on the assumption of conversion of all
potentially dilutive ordinary shares.
In the six months ended 30 June 2011 there were 188,733 share options (six
months ended 30 June 2010: nil; year ended 31 December 2010: nil) which were
potentially dilutive but were not included in the calculation of diluted
earnings per share because they were anti-dilutive.
The Group has $1.7 billion of senior convertible notes in issue (see note 11).
The impact of the potential conversion of these notes has been included in
diluted earnings and the diluted number of ordinary shares outstanding.
Underlying earnings is presented after non-controlling interests and excludes
special items and remeasurements (see note 4). Underlying earnings is distinct
from `Headline earnings`, which is a JSE Limited defined performance measure.
The calculation of basic and diluted earnings per share, based on headline and
underlying earnings, uses the following earnings data:
6 months ended 6 months ended Year ended
US$ million 30.06.11 30.06.10 31.12.10
Profit for the financial
period attributable to equity
shareholders of the Company 3,988 2,061 6,544
Operating special items - 7 14
Operating special items - tax - 1 -
Operating special items -
non-controlling interests - (2) (3)
Net (profit)/loss on disposals (423) 2 (1,684)
Net (profit)/loss on
disposals - tax 40 4 123
Net (profit)/loss on
disposals - non-controlling interests 2 12 138
Financing special items - 13 13
Tax special items (24) - -
Headline earnings for the
financial period 3,583 2,098 5,145
Operating special items (1) 25 97 239
Operating remeasurements (336) 41 (382)
Net loss on disposals (2) - 86 86
Financing remeasurements (49) (154) (106)
Special items and
remeasurements tax (3) (152) 51 (11)
Non-controlling interests on
special items and
remeasurements 49 (7) 5
Underlying earnings for the
financial period 3,120 2,212 4,976
(1) Includes restructuring costs, accelerated depreciation and related
charges.
(2) Includes amounts related to the Anglo American Inyosi Coal black economic
empowerment transaction.
(3) Includes certain tax special items.
10. Called-up share capital
30.06.11
Number of shares US$ million Number of shares
Called-up, allotted
and fully paid:
5% cumulative
preference shares
of GBP1 each 50,000 -
50,000
Ordinary shares of
54 86/91 US cents each 1,342,964,288 738 1,342,929,799
30.06.10 31.12.10
US$ million Number of shares US$ million
Called-up, allotted
and fully paid:
5% cumulative
preference shares of GBP1 each - 50,000
-
Ordinary shares of
54 86/91 US cents each 738 1,342,932,714 738
738 738
In the six months ended 30 June 2011 2,317 ordinary shares of 54 86/91 US
cents each were allotted to certain non- executive directors by subscription
of their after tax directors` fees (six months ended 30 June 2010: 2,661
ordinary shares; year ended 31 December 2010: 5,576 ordinary shares).
In addition, 29,257 ordinary shares of 54 86/91 US cents each were allotted
upon the conversion of Anglo American plc convertible bonds due 2014 (30 June
2010: nil; 31 December 2010: nil), see note 11.
In the event of winding up, the holders of the cumulative preference shares
will be entitled to the repayment of a sum equal to the nominal capital paid
up, or credited as paid up, on the cumulative preference shares held by them
and any accrued dividend, whether such dividend has been earned or declared or
not, calculated up to the date of the winding up.
11. Financial liabilities analysis
An analysis of borrowings, as presented on the Consolidated balance sheet, is
set out below:
30.06.11
Due within Due after
US$ million one year one year Total
Secured
Bank loans and overdrafts 59 362 421
Obligations under finance leases 3 3 6
62 365 427
Unsecured
Bank loans and overdrafts 743 1,972 2,715
Bonds issued under EMTN programme 100 4,501 4,601
US bonds - 3,300 3,300
Convertible bond (1) - 1,467 1,467
Commercial paper - - -
Other loans 156 892 1,048
999 12,132 13,131
Total 1,061 12,497 13,558
30.06.10
Due within Due after
US$ million one year one year Total
Secured
Bank loans and overdrafts 36 398 434
Obligations under finance leases 7 7 14
43 405 448
Unsecured
Bank loans and overdrafts 2,394 1,374 3,768
Bonds issued under EMTN programme 513 4,028 4,541
US bonds - 2,051 2,051
Convertible bond (1) - 1,400 1,400
Commercial paper 50 - 50
Other loans 121 818 939
3,078 9,671 12,749
Total 3,121 10,076 13,197
31.12.10
Due within Due after
US$ million one year one year Total
Secured
Bank loans and overdrafts 57 404 461
Obligations under finance leases 5 5 10
62 409 471
Unsecured
Bank loans and overdrafts 1,276 1,536 2,812
Bonds issued under EMTN programme 62 4,346 4,408
US bonds - 3,249 3,249
Convertible bond (1) - 1,434 1,434
Commercial paper - - -
Other loans 135 930 1,065
1,473 11,495 12,968
Total 1,535 11,904 13,439
(1) The debt component of the convertible bond includes cumulative unwinding
of discount of $138 million (six months ended 30 June 2010: $70 million; year
ended 31 December 2010: $104 million) and the effect of conversions during
the period of $1 million (six months ended 30 June 2010: nil; year ended
31 December 2010: nil).
The Group had the following undrawn committed borrowing facilities at the
period end:
US$ million 30.06.11 30.06.10 31.12.10
Expiry date
Within one year (1) 2,072 4,442 3,781
Greater than one year, less than two years 1,907 2,942 12
Greater than two years, less than five years 4,904 2,052 7,269
Greater than five years 88 54 58
8,971 9,490 11,120
(1) Includes undrawn rand facilities equivalent to $1.7 billion (30 June 2010:
$1.5 billion; 31 December 2010: $1.7 billion) in respect of a series of
facilities with 364 day maturities which roll automatically on a daily basis,
unless notice is served.
Convertible bond
In April 2009 the Group issued $1.7 billion of 4% senior convertible notes
(the Notes) which, at the holders` election, could be exchanged for ordinary
shares of Anglo American plc at a conversion price of GBP18.6370. The Group
will have the option to call the Notes after three years from the date of
issuance subject to certain conditions and, unless the Notes are redeemed,
converted or cancelled, they will mature in 2014. Following the 2010 final
dividend declaration and in accordance with the terms and conditions of the
Notes, the conversion price was adjusted to GBP18.3600 with effect from 13
April 2011.
On issuance of the Notes, the fair values of the debt and equity conversion
feature were $1,330 million and $355 million respectively. The equity
conversion feature is presented in equity within `Fair value and other
reserves`.
Derivative financial liabilities - Anglo American Sur
Anglo American inherited a 1978 agreement with Enami, a wholly owned Chilean
state controlled minerals company, when it acquired Anglo American Sur in
2002. In 2008 this agreement was transferred by Enami to Codelco, the Chilean
state copper company. Anglo American Sur is wholly owned by the Group and owns
the Los Bronces and El Soldado copper mines and the Chagres smelter. The
agreement grants Codelco the right, subject to certain conditions and
limitations, to acquire up to a 49% non-controlling interest in Anglo American
Sur. The right to exercise the option is restricted to a window that occurs
once every three years in the month of January until January 2027, with the
next window in January 2012. The calculations of the price at which Codelco
can exercise its rights are complex and confidential but do, inter alia, take
account of company profitability over a five year period.
Under IAS 39 Financial Instruments: Recognition and Measurement, the fair
valuation of the option is required to be performed from the perspective of a
market participant in an arm`s length transaction and does not take into
account specific factors relevant to any individual counterparty. In
particular, the IAS 39 valuation does not incorporate any capital gains tax
payable by the Group on exercise of the option to Codelco`s shareholder, the
Chilean government. The option`s fair value is calculated as the difference
between the estimated fair value of the underlying assets to which the option
relates and the estimated option price. The estimated fair value of the
underlying assets may vary significantly based on a market participant`s
assumptions at any point in time, including, inter alia, commodity prices,
foreign exchange rates and discount rates. In addition, the option price must
be estimated based on current assumptions about inputs that cannot be
finalised in advance of the option window and are subject to significant
fluctuations. Given the sensitivity of the calculation to the assumptions
made, differing assumptions result in a wide range of potential values for
the option. Notwithstanding this wide range, based on valuations determined
using assumptions considered within a reasonable range, it has been concluded
that the option has insufficient value, as determined by the applicable
accounting standard, to warrant recognition on the balance sheet at 30 June
2011.
12. Consolidated cash flow analysis
a) Reconciliation of profit
before tax to cash flows from operations
6 months ended 6 months ended Year ended
US$ million 30.06.11 30.06.10 31.12.10
Profit before tax 6,571 3,903 10,928
Depreciation and amortisation 949 919 1,919
Share-based payment charges 115 103 219
Net (profit)/loss on disposals (417) 92 (1,579)
Operating and financing
remeasurements (374) (119) (491)
Non-cash element of operating
special items (6) 49 134
Net finance (income)/costs
before remeasurements (20) 130 244
Share of net income from
associates (605) (384) (822)
(116) 59 (37)
Provisions
Increase in inventories (176) (386) (309)
Increase in operating
receivables (725) (671) (587)
Increase in operating payables 119 140 516
Deferred stripping (78) (100) (196)
Other adjustments (4) (6) (15)
Cash flows from operations 5,233 3,729 9,924
b) Reconciliation of net debt classifications to the balance sheet
Cash and cash equivalents (1)
US$ million 30.06.11 30.06.10 31.12.10
Balance sheet 6,805 2,868 6,401
Balance sheet - trade and
other receivables (2) - - -
Balance sheet - disposal
groups (3) - 99 59
Bank overdrafts - (2) -
Bank overdrafts - disposal groups (3) - (9) -
Net debt classifications 6,805 2,956 6,460
Short term borrowings
US$ million 30.06.11 30.06.10 31.12.10
Balance sheet (1,061) (3,121) (1,535)
Balance sheet - trade and
other receivables (2) - - -
Balance sheet - disposal
groups (3) - (1) -
Bank overdrafts - 2 -
Bank overdrafts - disposal
groups (3) - - -
Net debt classifications (1,061) (3,120) (1,535)
Medium and long term borrowings
US$ million 30.06.11 30.06.10 31.12.10
Balance sheet (12,497) (10,076) (11,904)
Balance sheet - trade and
other receivables (2) - - -
Balance sheet - disposal
groups (3) - (1) -
Bank overdrafts - - -
Bank overdrafts - disposal
groups (3) - - -
Net debt classifications (12,497) (10,077) (11,904)
Current financial asset investments
US$ million 30.06.11 30.06.10 31.12.10
Balance sheet - - -
Balance sheet - trade and
other receivables (2) - 6 -
Balance sheet - disposal
groups (3) - - -
Bank overdrafts - - -
Bank overdrafts - disposal
groups (3) - - -
Net debt classifications - 6 -
(1) `Short term borrowings` on the balance sheet include overdrafts which are
included within cash and cash equivalents in determining net debt.
(2) Current financial asset investments of $6 million at 30 June 2010 have
been reclassified on the balance sheet to other receivables.
(3) Disposal group balances are shown within `Assets classified as held for
sale` and `Liabilities directly associated with assets classified as held for
sale` on the balance sheet.
c) Movement in net debt
Cash and Debt due Debt due Current
cash within after financial asset
equivalents (1) one year one year investments
US$ million
Balance at 1
January 2010 3,319 (1,498) (12,819) 3
Cash flow (327) 634 79 3
Unwinding of
discount on
convertible bond - - (31) -
Disposal of
business - - 1 -
Reclassifications - (2,310) 2,310 -
Movement in fair value - 8 (266) -
Other non-cash
movements - - (8) -
Currency
movements (36) 46 657 -
Balance at 30
June 2010 2,956 (3,120) (10,077) 6
Cash flow 3,184 1,704 (1,273) (10)
Unwinding of
discount on
convertible bond - - (34) -
Disposal of
business - 1 1 -
Reclassifications - (49) 49 -
Movement in fair value - (14) 86 -
Other non-cash
movements - - (3) 3
Currency movements 320 (57) (653) 1
Balance at 31
December 2010 6,460 (1,535) (11,904) -
Cash flow 395 691 (457) -
Unwinding of
discount on
convertible bond - - (34) -
Reclassifications - (187) 187 -
Movement in fair value - - (10) -
Other non-cash movements - (10) (11) -
Currency movements (50) (20) (268) -
Balance at 30
June 2011 6,805 (1,061) (12,497) -
Net debt Net debt
excluding including
hedges Hedges (2) hedges
US$ million
Balance at 1 January 2010 (10,995) (285) (11,280)
Cash flow 389 (238) 151
Unwinding of discount on convertible bond (31) - (31)
Disposal of business 1 - 1
Reclassifications - - -
Movement in fair value (258) (172) (430)
Other non-cash movements (8) - (8)
Currency movements 667 - 667
Balance at 30 June 2010 (10,235) (695) (10,930)
Cash flow 3,605 21 3,626
Unwinding of discount on convertible bond (34) - (34)
Disposal of business 2 - 2
Reclassifications - - -
Movement in fair value 72 267 339
Other non-cash movements - - -
Currency movements (389) 2 (387)
Balance at 31 December 2010 (6,979) (405) (7,384)
Cash flow 629 (53) 576
Unwinding of discount on convertible bond (34) - (34)
Reclassifications - - -
Movement in fair value (10) 418 408
Other non-cash movements (21) - (21)
Currency movements (338) (1) (339)
Balance at 30 June 2011 (6,753) (41) (6,794)
(1) The Group operates in certain countries where the existence of exchange
controls may restrict the use of certain cash balances (principally South
Africa and Venezuela). These restrictions are not expected to have a material
effect on the Group`s ability to meet its ongoing obligations.
(2) Derivative instruments that provide an economic hedge of assets and
liabilities in net debt are included above to reflect the true net debt
position of the Group at the period end. These consist of net current
derivative assets of $91 million (30 June 2010: $37 million net liabilities;
31 December 2010: $2 million net assets) and net non-current derivative
liabilities of $132 million (30 June 2010: $658 million net liabilities; 31
December 2010: $407 million net liabilities) which are classified within
`Other financial assets (derivatives)` and `Other financial liabilities
(derivatives)` on the balance sheet.
13. Disposals
6 months ended 6 months ended Year ended
US$ million 30.06.11 30.06.10 31.12.10
Net assets disposed
Property, plant and equipment 110 125 1,443
Other non-current assets 53 61 658
Current assets 431 123 852
Current liabilities (39) (45) (240)
Non-current liabilities (100) (23) (412)
Net assets 455 241 2,301
Non-controlling interests (42) - (14)
Group`s share of net assets
immediately prior to disposal 413 241 2,287
Fair value adjustment to
retained investments - - 440
Less: Retained investments - - (826)
Net assets disposed 413 241 1,901
Cumulative translation
differences recycled from reserves 42 (3) (40)
Net profit on disposals (see note 4) 397 25 1,246
Net sale proceeds 852 263 3,107
Net cash and cash equivalents
disposed (356) (20) (280)
Non-cash/deferred
consideration - (83) (83)
Accrued transaction costs and
similar items 3 - 51
Net cash inflow from disposals (1) 499 160 2,795
(1) In addition, in the six months ended 30 June 2011, there was a net cash
inflow of $6 million in respect of disposals in 2010 resulting in a total net
cash inflow from disposals of $505 million. Of this a net cash inflow of $486
million (six months ended 30 June 2010: $130 million; year ended 31 December
2010: $2,539 million) related to disposals of subsidiaries and $19 million
(six months ended 30 June 2010: $30 million; year ended 31 December 2010: $256
million) related to the sale of interests in joint ventures.
Disposals in the six months ended 30 June 2011
Disposals of subsidiaries during the six months ended 30 June 2011 related to
the disposal of Lisheen and a 74% interest in Black Mountain (the Group`s
remaining zinc operating assets) in the Other Mining and Industrial segment.
The Group announced the sale of its zinc portfolio to Vedanta Resources plc on
10 May 2010, for a total consideration of $1,338 million on an attributable
debt and cash free basis. Due to the regulatory approval and competition
clearance processes, separate completion dates were expected for each of the
businesses within the zinc portfolio. Following regulatory approval from the
relevant authorities, the completion of the sale of Lisheen and Black Mountain
took place in February 2011 for a combined net cash inflow of $499 million.
Disposals in 2010
Disposals of subsidiaries and joint ventures during 2010 mainly related to
disposals in the Other Mining and Industrial, Platinum and Metallurgical Coal
segments.
Disposals in the Other Mining and Industrial segment related to Moly-Cop and
AltaSteel, the Skorpion zinc mine and Tarmac European businesses. Disposals in
the Platinum segment mainly related to the Bafokeng-Rasimone Platinum mine
transaction and disposals in the Metallurgical Coal segment mainly related to
undeveloped coal assets.
14. Disposal groups and non-current assets held for sale
There were no assets or liabilities in disposal groups or non-current assets
classified as held for sale at 30 June 2011.
The following assets and liabilities relating to disposal groups were
classified as held for sale at 30 June 2010 and 31 December 2010.
(1) (2)
US$ million 30.06.10 31.12.10
Intangible assets 16 4
Property, plant and equipment 761 117
Other non-current assets 53 49
Total non-current assets 830 170
Inventories 110 26
Trade and other receivables 107 75
Cash and cash equivalents 99 59
Total current assets 316 160
Total assets 1,146 330
Trade and other payables (111) (40)
Short term borrowings (10) -
Provisions for liabilities and charges (4) -
Total current liabilities (125) (40)
Deferred tax liabilities (66) (23)
Provisions for liabilities and charges (140) (72)
Other non-current liabilities (11) (7)
Total non-current liabilities (217) (102)
Total liabilities (342) (142)
Net assets 804 188
(1) Relates principally to the Group`s portfolio of zinc assets (comprising
Skorpion, Lisheen and a 74% interest in Black Mountain) and certain of
Tarmac`s European businesses. These assets were included in the Other Mining
and Industrial segment.
(2) Relates to the Group`s portfolio of zinc assets for which disposal
transactions had not completed at 31 December 2010 (Lisheen and a 74% interest
in Black Mountain).
15. Contingent liabilities
The Group is subject to various claims which arise in the ordinary course of
business. Additionally, and as set out in the 2007 demerger agreement, Anglo
American and the Mondi Group have agreed to indemnify each other, subject to
certain limitations, against certain liabilities. Having taken appropriate
legal advice, the Group believes that the likelihood of a material liability
arising is remote.
At 30 June 2011 the Group and its subsidiaries had provided aggregate amounts
of $992 million (30 June 2010: $757 million; 31 December 2010: $813 million)
of loans and performance guarantees to banks and other third parties
primarily in respect of environmental restoration and decommissioning
obligations.
No contingent liabilities were secured on the assets of the Group at 30 June
2011, 30 June 2010 or 31 December 2010.
Other
Kumba Iron Ore (Kumba)
Sishen Supply Agreement arbitration
Kumba`s Sishen Iron Ore Company (SIOC) notified ArcelorMittal South Africa
Limited (ArcelorMittal) on 5 February 2010, that it was no longer entitled to
receive 6.25 Mtpa of iron ore contract mined by SIOC at cost plus 3% from
Sishen Mine, as a result of the fact that ArcelorMittal had failed to convert
its old order mining rights. This contract mining agreement, concluded in
2001, was premised on ArcelorMittal owning an undivided 21.4% interest in the
mineral rights of Sishen Mine. As a result of ArcelorMittal`s failure to
convert its old order mining right, the contract mining agreement
automatically lapsed and became inoperative in its entirety as of 1 May 2009.
As a result, a dispute arose between SIOC and ArcelorMittal, which SIOC has
referred to arbitration. Both parties have exchanged their respective
pleadings, and the arbitration panel has been appointed.
SIOC and ArcelorMittal reached an interim pricing arrangement in respect of
the supply of iron ore to ArcelorMittal from the Sishen Mine. This arrangement
will endure until 31 July 2011. In view of the fact that the arbitration
proceedings between the two companies is anticipated to take place in the
first half of 2012, SIOC and ArcelorMittal have now agreed to an addendum to
the current interim supply agreement which extends the terms and conditions of
the current interim agreement to allow sufficient time for the arbitration
process to be finalised. The new interim pricing agreement, which is on the
same terms and conditions as the first interim pricing agreement, will
commence on 1 August 2011 and endure to 31 July 2012.
21.4% undivided share of the Sishen Mine mineral rights
After ArcelorMittal failed to convert its old order rights, SIOC applied for
the residual 21.4% mining right previously held by ArcelorMittal and its
application was accepted by the Department of Mineral Resources (DMR) on 4 May
2009. A competing application for a prospecting right over the same area was
also accepted by the DMR. SIOC objected to this acceptance. Notwithstanding
this objection, a prospecting right over the 21.4% interest was granted by the
DMR to Imperial Crown Trading 289 (Pty) Limited (ICT). SIOC initiated a review
application in the North Gauteng High Court on 21 May 2010 in relation to the
decision of the DMR to grant a prospecting right to ICT. This review
application is enrolled for determination in the High Court on 15 August 2011.
SIOC initiated an application on 14 December 2010 to interdict ICT from
applying for a mining right in respect of the Sishen Mine and the DMR from
accepting an application from ICT or granting such 21.4% mining right to ICT
pending the final determination of the review application. This interdict
application is currently pending.
The DMR informed SIOC on 12 January 2011 that ICT had applied for a 21.4%
mining right over Sishen Mine on 9 December 2010, and that the DMR had
accepted this application on 23 December 2010. The DMR`s acceptance of the
application means that the mining right application will now be evaluated
according to the detailed process stipulated in the Mineral Resources &
Petroleum Development Act 2004 before a decision is made as to whether or not
to grant the mining right.
SIOC does not believe that it was lawful for the DMR to have accepted ICT`s
application pending the High Court Review initiated in May 2010, and has
formally objected to, and appealed against, the DMR`s acceptance of ICT`s
mining right application. SIOC`s interdict application to prevent the DMR from
considering ICT`s mining rights application until the finalisation of the
review proceedings is currently enrolled for determination on 15 August 2011.
In addition, SIOC has challenged the DMR`s decision of 25 January 2011 to
reject SIOC`s May 2009 application to be granted the residual 21.4% mining
right by lodging an appeal. No decision on this appeal has been received to
date. Finally, on 26 January 2011, SIOC lodged a new application for the
21.4% mining right.
On 4 February 2011, SIOC successfully made an application to join
ArcelorMittal as a respondent in the review process. The joinder application
was granted by the High Court on 6 June 2011, and ArcelorMittal has submitted
affidavits to the Court.
SIOC will continue to take the necessary steps to protect its shareholders`
interests in this regard.
Anglo American South Africa Limited (AASA)
AASA, a wholly owned subsidiary of the Company, is a defendant in 24 separate
lawsuits, each one on behalf of a former mineworker (or his dependents or
survivors) who allegedly contracted silicosis working for gold mining
companies in which AASA was a shareholder and to which AASA provided various
technical and administrative services. The aggregate amount of the 24 claims
is less than $5 million, although if these claims are determined adversely to
AASA, there are a substantial number of additional former mineworkers (or
their dependents or survivors) who may seek to bring similar claims. The first
trials of these claims are not expected before 2013.
16. Related party transactions
The Group has a related party relationship with its subsidiaries, joint
ventures and associates.
The Company and its subsidiaries, in the ordinary course of business, enter
into various sales, purchase and service transactions with joint ventures and
associates and others in which the Group has a material interest. These
transactions are under terms that are no less favourable than those arranged
with third parties. These transactions are not considered to be significant.
At 30 June 2011 the Group had provided loans to joint ventures of $331 million
(30 June 2010: $284 million; 31 December 2010: $319 million). These loans are
included in financial asset investments. Amounts payable to joint ventures at
30 June 2011 were $43 million (30 June 2010: nil; 31 December 2010: $59
million).
Dividends received from associates during the six months ended 30 June 2011
totalled $165 million (six months ended 30 June 2010: $72 million; year ended
31 December 2010: $255 million), as disclosed in the Consolidated cash flow
statement.
In addition to the investments in associates disclosed on the Consolidated
balance sheet, the Group had provided loans to associates at 30 June 2011 of
$621 million (30 June 2010: $481 million; 31 December 2010: $531 million).
These are included in financial asset investments.
At 30 June 2011 the directors of the Company and their immediate relatives
controlled 0.1% (30 June 2010: 2.6%; 31 December 2010: 2.5%) of the voting
shares of the Company.
Related party transactions with De Beers
As previously reported on, the Group has in prior financial periods entered
into various transactions with DB Investments SA and De Beers SA (together De
Beers) which were considered to be related party transactions for the purposes
of the United Kingdom Listing Authority Listing Rules as a result of the
interest in De Beers held by Central Holdings Limited and certain of its
subsidiaries in which Mr N. F. Oppenheimer, a director of the Company at the
time of these transactions, had a relevant interest for the purpose of the
rules. The related party transactions entered into and which continue to be
relevant in the current financial period are detailed below.
The Group has advanced various loans to De Beers and at 30 June 2011 the
amount of outstanding loans owed by De Beers (and included in the loans to
associates amount disclosed above) was $315 million (30 June 2010: $367
million; 31 December 2010: $358 million). These loans are subordinated in
favour of third party lenders and include:
- dividend reinvestment loans of $133 million (30 June 2010: $142 million; 31
December 2010: $133 million) advanced during 2008 and 2009. These loans were
interest free for two years from the date of advance and subsequently became
interest bearing in line with market rates at the date of the initial
reinvestment; and
- a further shareholder loan of $182 million (30 June 2010: $225 million; 31
December 2010: $225 million) advanced in 2009. This loan was interest free for
two years after which it reverted to a rate of interest equal to LIBOR plus
700 basis points until April 2016 and then, provided all interest payments are
up to date, reduces to LIBOR plus 300 basis points. During the period, De
Beers repaid $45 million of this loan, including accrued interest of $2
million.
In December 2010 De Beers redeemed all of its outstanding 10% non-cumulative
redeemable preference shares held by the Group. At 30 June 2010 the Group held
$88 million of these preference shares.
17. Events occurring after the period end
With the exception of the declaration of the 2011 interim dividend, there have
been no material reportable events since 30 June 2011.
Responsibility statement
We confirm that to the best of our knowledge:
(a) the Condensed financial statements have been prepared in accordance with
IAS 34 Interim Financial Reporting, and give a true and fair view of the
assets, liabilities, financial position and profit of the undertakings
included in the consolidation as a whole;
(b) the Half year financial report includes a fair review of the information
required by DTR 4.2.7 R (being an indication of important events that have
occurred during the first six months of the financial year, and their impact
on the Half year financial report, and a description of the principal risks
and uncertainties for the remaining six months of the financial year); and
(c) the Half year financial report includes a fair review of the information
required by DTR 4.2.8 R (being disclosure of related party transactions that
have taken place in the first six months of the current financial year and
that have materially affected the financial position or the performance of the
Group during that period and any changes in the related party transactions
described in the last annual report that could have a material effect on the
financial position or performance of the Group in the first six months of the
current financial year).
By order of the Board
Cynthia Carroll Rene Medori
Chief executive Finance director
INDEPENDENT REVIEW REPORT TO ANGLO AMERICAN PLC
We have been engaged by the Company to review the Condensed financial
statements in the Half year financial report for the six months ended 30 June
2011 which comprise the Consolidated income statement, the Consolidated
statement of comprehensive income, the Consolidated balance sheet, the
Consolidated cash flow statement, the Consolidated statement of changes in
equity and related notes 1 to 17. We have read the other information contained
in the Half year financial report and considered whether it contains any
apparent misstatements or material inconsistencies with the information in the
Condensed financial statements.
This report is made solely to the Company in accordance with International
Standard on Review Engagements (UK and Ireland) 2410 Review of Interim
Financial Information Performed by the Independent Auditor of the Entity
issued by the Auditing Practices Board. Our work has been undertaken so that
we might state to the Company those matters we are required to state to them
in an independent review report and for no other purpose. To the fullest
extent permitted by law, we do not accept or assume responsibility to anyone
other than the Company, for our review work, for this report, or for the
conclusions we have formed.
Directors` responsibilities
The Half year financial report is the responsibility of, and has been approved
by, the directors. The directors are responsible for preparing the Half year
financial report in accordance with the Disclosure and Transparency Rules of
the United Kingdom`s Financial Services Authority.
As disclosed in note 1, the annual financial statements of the Group are
prepared in accordance with IFRSs as adopted by the European Union. The
Condensed financial statements included in this Half year financial report
have been prepared in accordance with International Accounting Standard 34,
Interim Financial Reporting (IAS 34), as adopted by the European Union.
Our responsibility
Our responsibility is to express to the Company a conclusion on the Condensed
financial statements in the Half year financial report based on our review.
Scope of Review
We conducted our review in accordance with International Standard on Review
Engagements (UK and Ireland) 2410 Review of Interim Financial Information
Performed by the Independent Auditor of the Entity issued by the Auditing
Practices Board for use in the United Kingdom. A review of interim financial
information consists of making inquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other review
procedures. A review is substantially less in scope than an audit conducted in
accordance with International Standards on Auditing (UK and Ireland) and
consequently does not enable us to obtain assurance that we would become aware
of all significant matters that might be identified in an audit. Accordingly,
we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to
believe that the Condensed financial statements in the Half year financial
report for the six months ended 30 June 2011 are not prepared, in all material
respects, in accordance with IAS 34 as adopted by the European Union and the
Disclosure and Transparency Rules of the United Kingdom`s Financial Services
Authority.
Deloitte LLP
Chartered Accountants and Statutory Auditor
London, United Kingdom
28 July 2011
Production statistics
The figures below include the entire output of consolidated entities and the
Group`s attributable share of joint ventures, joint arrangements and
associates where applicable, except for Collahuasi in the Copper segment and
De Beers which are quoted on a 100% basis.
6 months ended 6 months ended Year ended
30.06.11 30.06.10 31.12.10
Iron Ore and Manganese
segment (tonnes)
Kumba Iron Ore
Lump 11,784,300 13,214,000 25,922,300
Fines 7,369,600 8,721,400 17,462,600
Amapa
Sinter feed 641,600 682,000 2,136,900
Pellet feed 1,683,400 1,170,000 1,892,500
Total iron ore production 21,478,900 23,787,400 47,414,300
Samancor (1)
Manganese ore 1,256,700 1,372,400 2,952,800
Manganese alloys (2) 144,900 155,600 312,000
Coal (tonnes)
Metallurgical Coal segment
Australia
Metallurgical 5,699,000 7,079,500 14,701,800
Thermal 6,089,800 7,320,000 14,460,500
Total Metallurgical Coal
segment coal production 11,788,800 14,399,500 29,162,300
Thermal Coal segment
South Africa
Metallurgical 163,300 221,800 436,500
Thermal 10,343,700 9,913,300 21,612,000
Eskom 17,057,600 16,487,300 36,403,400
Colombia 27,564,600 26,622,400 58,451,900
Thermal 5,147,200 5,317,800 10,060,100
Total Thermal Coal segment
coal production 32,711,800 31,940,200 68,512,000
Other Mining and Industrial
segment
Canada
Metallurgical 415,100 401,400 868,000
South America
Thermal - 262,900 441,400
Total Other Mining and
Industrial segment coal
production 415,100 664,300 1,309,400
Total coal production 44,915,700 47,004,000 98,983,700
Coal (tonnes)
Metallurgical Coal segment
Australia
Callide 3,657,700 4,377,900 8,515,600
Drayton 1,808,500 2,202,900 4,206,000
Capcoal 2,017,800 2,797,700 5,460,300
Jellinbah East 844,400 979,500 1,792,500
Moranbah North 1,711,800 1,727,400 3,937,800
Dawson Complex 1,227,300 1,505,900 3,584,400
Foxleigh 521,300 808,200 1,665,700
Total Metallurgical Coal
segment coal production 11,788,800 14,399,500 29,162,300
Thermal Coal segment
South Africa
Greenside 1,444,700 1,655,100 3,425,000
Goedehoop 2,702,100 2,890,300 6,026,200
Isibonelo 2,131,900 2,040,400 4,569,100
Kriel 3,942,500 4,519,400 9,526,100
Kleinkopje 2,136,000 2,108,000 4,423,600
Landau 1,929,000 1,955,000 4,085,800
New Denmark 2,331,600 2,267,200 5,051,600
New Vaal 8,503,800 7,629,800 17,235,300
Mafube 1,109,700 1,097,000 2,447,700
Zibulo (3) 1,333,300 460,200 1,661,500
Colombia 27,564,600 26,622,400 58,451,900
Carbones del Cerrejon 5,147,200 5,317,800 10,060,100
Total Thermal Coal segment
coal production 32,711,800 31,940,200 68,512,000
(1) Saleable production.
(2) Production includes Medium Carbon Ferro Manganese.
(3) Zibulo is currently not in commercial production and therefore all revenue
and related costs associated with 1,333 kt (six months ended 30 June 2010: 460
kt; year ended 31 December 2010: 1,662 kt) of production have been
capitalised. The 1,333 kt includes Eskom coal of 397 kt (six months ended
30 June 2010: 262 kt; year ended 31 December 2010: 765 kt) and export thermal
coal production of 936 kt (six months ended 30 June 2010: 198 kt; year ended
31 December 2010: 897 kt).
6 months ended
30.06.11
Coal (tonnes) (continued)
Other Mining and Industrial segment
Canada
Peace River Coal 415,100
South America
Carbones del Guasare (1) -
Total Other Mining and Industrial segment coal production 415,100
Total coal production 44,915,700
Total coal production by commodity (tonnes)
Metallurgical
South Africa 163,300
Australia 5,699,000
Canada 415,100
Total metallurgical coal production 6,277,400
Thermal
South Africa - Thermal 10,343,700
South Africa - Eskom 17,057,600
Australia 6,089,800
South America 5,147,200
38,638,300
Total thermal coal production
Total coal production 44,915,700
Copper segment
Collahuasi
100% basis
(Anglo American share 44%)
Ore mined tonnes 23,224,200
Ore processed
Oxide tonnes 3,686,900
Sulphide tonnes 24,387,700
Ore grade
processed Oxide % Cu 0.5
Sulphide % Cu 1.0
ProductionCopper concentrate dry metric tonnes 801,600
Copper cathode tonnes 18,000
Copper in concentrate tonnes 216,500
Total
copper
production for
Collahuasi tonnes 234,500
Anglo
American`s share
of copper
production
for
Collahuasi tonnes 103,200
Anglo American
Sur
Los
Bronces mine
Ore mined tonnes 11,709,300
Marginal ore mined tonnes 17,884,700
Las
Tortolas
concentra
tor Ore processed tonnes 10,539,200
Ore grade processed % Cu 0.9
Average recovery % 86.3
ProductionCopper concentrate dry metric tonnes 300,000
Copper cathode tonnes 18,100
Copper in sulphate tonnes 1,700
Copper in concentrate tonnes 81,900
Total tonnes 101,700
El
Soldado
mine
Ore mined Open pit - ore mined tonnes 4,508,600
Open pit - marginal ore mined tonnes -
Underground (sulphide) tonnes -
Total tonnes 4,508,600
Ore
processed Oxide tonnes 912,600
Sulphide tonnes 3,470,800
Ore grade
processed Oxide % Cu 0.7
Sulphide % Cu 0.7
dry metric tonnes 70,100
ProductionCopper concentrate
Copper cathode tonnes 2,500
Copper in concentrate tonnes 15,400
Total tonnes 17,900
6 months ended
30.06.10
Coal (tonnes) (continued)
Other
Mining and Industrial
segment
Canada
Peace River
Coal 401,400
South America
Carbones del Guasare (1) 262,900
Total
Other
Mining and
Industrial segment coal
production 664,300
Totalcoal
production 47,004,000
Total
coal
production by
commodity
(tonnes)
Metallurgical
South
Africa 221,800
Australia 7,079,500
Canada 401,400
Total
metallurgical
coal
production 7,702,700
Thermal
South Africa - Thermal 9,913,300
South Africa - Eskom 16,487,300
Australia 7,320,000
South America 5,580,700
39,301,300
Total
thermal coal
production
Total
coal
production 47,004,000
Copper
segment
Collahuasi
100%
basis
(AngloAmerican
share 44%)
Ore mined tonnes 47,222,700
Ore
process
ed Oxide tonnes 3,387,300
Sulphide tonnes 24,412,600
Ore
grade
process
ed Oxide % Cu 0.5
Sulphide % Cu 1.1
ProductionCopper concentrate dry metric tonnes 949,800
Copper cathode tonnes 19,900
Copper in concentrate tonnes 246,900
Total
copper
production for
Collahuasi tonnes 266,800
Anglo American`s
share of copper
production for
Collahuasi tonnes 117,400
Anglo American Sur Los
Bronces mine
Ore mined tonnes 9,608,200
Marginal ore mined tonnes 21,744,400
Las
Tortolas
concent
rator Ore processed tonnes 9,423,300
Ore grade processed % Cu 1.1
Average recovery % 87.8
ProductionCopper concentrate dry metric tonnes 296,600
Copper cathode tonnes 22,000
Copper in sulphate tonnes 2,100
Copper in concentrate tonnes 87,100
Total tonnes 111,200
El
Soldado
mine
Ore
mined Open pit - ore mined tonnes 2,507,500
Open pit - marginal ore mined tonnes 101,900
Underground (sulphide) tonnes 681,900
Total tonnes 3,291,300
Ore
process
ed Oxide tonnes 770,600
Sulphide tonnes 3,638,700
Ore
grade
processed Oxide % Cu 0.7
Sulphide % Cu 0.6
dry metric tonnes 91,600
ProductionCopper concentrate
Copper cathode tonnes 2,100
Copper in concentrate tonnes 18,100
Total tonnes 20,200
Year ended
31.12.10
Coal (tonnes)
(continued)
Other Mining and
Industrial
segment
Canada
Peace River
Coal 868,000
South America
Carbones
del Guasare (1) 441,400
Total Other
Mining and
Industrial
segment coal
production 1,309,400
Total coal
production 98,983,700
Total coal
production
by commodity
(tonnes)
Metallurgical
South Africa 436,500
Australia 14,701,800
Canada 868,000
Total
metallurgic
al coal
production 16,006,300
Thermal
South
Africa -
Thermal 21,612,000
South
Africa -
Eskom 36,403,400
Australia 14,460,500
South
America 10,501,500
82,977,400
Total thermal coal
production
Total coal
production 98,983,700
Copper segment
Collahuasi
100% basis
(Anglo American
share 44%)
Ore mined tonnes 84,060,000
Ore
processed Oxide tonnes 7,226,800
Sulphide tonnes 49,119,900
Ore grade
processed Oxide % Cu 0.5
Sulphide % Cu 1.1
Production Copper concentrate dry metric tonnes 1,789,300
Copper cathode tonnes 38,800
Copper in concentrate tonnes 465,200
Total
copper
production
for
Collahuasi tonnes 504,000
Anglo
American`s
share of
copper
production
for
Collahuasi tonnes 221,800
Anglo
American
Sur
Los Bronces
mine
Ore mined tonnes 20,021,600
Marginal
ore mined tonnes 43,266,400
Las
Tortolas
concentratorOre processed tonnes 18,909,400
Ore grade processed % Cu 1.0
Average recovery % 88.2
Production Copper concentrate dry metric tonnes 598,300
Copper cathode tonnes 42,600
Copper in sulphate tonnes 4,100
Copper in concentrate tonnes 174,700
Total tonnes 221,400
El Soldado
mine
Ore mined Open pit - ore mined tonnes 4,890,400
Open pit - marginal ore mined tonnes 101,900
Underground (sulphide) tonnes 1,390,200
Total tonnes 6,382,500
Ore
processed Oxide tonnes 1,532,200
Sulphide tonnes 7,176,100
Ore grade
processed Oxide % Cu 0.7
Sulphide % Cu 0.6
dry metric tonnes 174,000
Production Copper concentrate
Copper cathode tonnes 4,700
Copper in concentrate tonnes 35,700
Total tonnes 40,400
(1) At 31 December 2010 Carbones del Guasare had ceased to be an associate of
the Group.
6 months ended
30.06.11
Copper
segment
(continued)
Anglo
American
Sur
(continued)
Chagres
Smelter
Copper concentrate smelted tonnes 66,700
Production Copper blister/anode tonnes 64,300
Acid tonnes 232,700
Total
copper
production
for Anglo
American
Sur (1) tonnes 119,600
Anglo
American
Norte
Mantos
Blancos
mine
Ore
processed Oxide tonnes 2,203,700
Sulphide tonnes 1,997,300
Marginal ore mined tonnes 2,513,600
Ore grade
processed Oxide % Cu (soluble) 0.5
Sulphide % Cu (insoluble) 1.1
Marginal ore % Cu (soluble) 0.2
Production Copper concentrate dry metric tonnes 62,300
Copper cathode tonnes 16,500
Copper in concentrate tonnes 19,600
Total tonnes 36,100
Mantoverde
mine
Ore
processed Oxide tonnes 4,815,100
Marginal ore tonnes 3,957,200
Ore grade
processed Oxide % Cu (soluble) 0.7
Marginal ore % Cu (soluble) 0.3
Production Copper cathode tonnes 30,200
Total
copper
production
for Anglo
American
Norte (1) tonnes 66,300
Total
Copper
segment
copper
production (1) tonnes 289,100
Platinum
copper
production tonnes 6,800
Black
Mountain
copper
production tonnes 300
Total
attributab
le copper
production (1) tonnes 296,200
Nickel
segment
Codemin
Ore mined (2) tonnes 216,700
Ore
processed tonnes 270,900
Ore grade
processed % Ni 1.9
Production tonnes 4,600
Loma de
Niquel
Ore mined tonnes 679,800
Ore
processed tonnes 525,500
Ore grade
processed % Ni 1.5
Production tonnes 7,000
Barro Alto (3)
Ore mined tonnes 618,200
Ore
processed tonnes 93,000
Ore grade
processed % Ni 1.9
Production tonnes 1,100
Total
Nickel
segment
nickel
production tonnes 12,700
Platinum
nickel
production tonnes 10,300
Total
attributab
le nickel
production tonnes 23,000
Platinum
segment (4)
Platinum troy ounces 1,173,600
troy ounces 662,000
Palladium
Rhodium troy ounces 165,600
troy ounces 2,001,200
Nickel (5) tonnes 10,300
Copper (5) tonnes 6,800
Gold troy ounces 60,000
Equivalent
refined
platinum troy ounces 1,160,100
6 months ended
30.06.10
Copper
segment
(continued)
Anglo
American
Sur (continued)
Chagres
Smelter
Copper concentrate smelted tonnes 69,400
Production Copper blister/anode tonnes 67,600
Acid tonnes 224,900
Total
copper
production
for Anglo
American
Sur (1) tonnes 131,400
Anglo
American
Norte
Mantos
Blancos
mine
Ore
processed Oxide tonnes 2,185,100
Sulphide tonnes 1,749,400
Marginal ore mined tonnes 2,649,700
Ore grade
processed Oxide % Cu (soluble) 0.6
Sulphide % Cu (insoluble) 1.1
Marginal ore % Cu (soluble) 0.2
Production Copper concentrate dry metric tonnes 53,800
Copper cathode tonnes 19,300
Copper in concentrate tonnes 17,700
Total tonnes 37,000
Mantoverde
mine
Ore
processed Oxide tonnes 4,474,200
Marginal ore tonnes 2,559,000
Ore grade
processed Oxide % Cu (soluble) 0.7
Marginal ore % Cu (soluble) 0.3
Production Copper cathode tonnes 29,700
Total
copper
production
for Anglo
American
Norte (1) tonnes 66,700
Total
Copper
segment
copper
production (1) tonnes 315,500
Platinum
copper
production tonnes 5,600
Black
Mountain
copper
production tonnes 1,000
Total
attributab
le copper
production (1) tonnes
322,100
Nickel
segment
Codemin
Ore mined (2) tonnes 336,600
Ore
processed tonnes 262,900
Ore grade
processed % Ni 1.9
Production tonnes 4,600
Loma de
Niquel
Ore mined tonnes 382,500
Ore
processed tonnes 356,100
Ore grade
processed % Ni 1.6
Production tonnes 5,500
Barro Alto (3)
Ore mined tonnes 121,800
Ore
processed tonnes -
Ore grade
processed % Ni -
Production tonnes -
Total
Nickel
segment
nickel
production tonnes 10,100
Platinum
nickel
production tonnes 9,200
Total
attributable nickel
production tonnes 19,300
Platinum
segment (4)
Platinum troy ounces 1,000,500
troy ounces 541,400
Palladium
Rhodium troy ounces 128,900
troy ounces 1,670,800
Nickel (5) tonnes 9,200
Copper (5) tonnes 5,600
Gold troy ounces 38,900
Equivalent
refined
platinum troy ounces 1,195,700
Year ended
31.12.10
Copper segment
(continued)
Anglo American
Sur
(continued)
Chagres Smelter
Copper concentrate smelted tonnes 142,100
Production Copper blister/anode tonnes 137,900
Acid tonnes 466,700
Total copper
production for
Anglo American
Sur (1) tonnes 261,800
Anglo American
Norte
Mantos Blancos
mine
Ore processed Oxide tonnes 4,380,900
Sulphide tonnes 3,924,700
Marginal ore mined tonnes 5,628,900
Ore grade
processed Oxide % Cu (soluble) 0.6
Sulphide % Cu (insoluble) 1.1
Marginal ore % Cu (soluble) 0.2
Production Copper concentrate dry metric tonnes 119,300
Copper cathode tonnes 39,100
Copper in concentrate tonnes 39,500
Total tonnes 78,600
Mantoverde mine
Ore processed Oxide tonnes 9,223,200
Marginal ore tonnes 5,237,000
Ore grade
processed Oxide % Cu (soluble) 0.7
Marginal ore % Cu (soluble) 0.3
Production Copper cathode tonnes 61,100
Total copper
production for
Anglo American
Norte (1) tonnes 139,700
Total Copper
segment copper
production (1) tonnes 623,300
Platinum
copper
production tonnes 10,900
Black Mountain
copper
production tonnes 2,500
Total
attributable
copper
production (1) tonnes
636,700
Nickel segment
Codemin 493,900
Ore mined (2) tonnes
Ore processed tonnes 488,300
Ore grade
processed % Ni 1.9
Production tonnes 8,500
Loma de Niquel
Ore mined tonnes 714,200
Ore processed tonnes 798,000
Ore grade
processed % Ni 1.6
Production tonnes 11,700
Barro Alto (3)
Ore mined tonnes 723,600
Ore processed tonnes -
Ore grade
processed % Ni -
Production tonnes -
Total Nickel
segment nickel
production tonnes 20,200
Platinum
nickel
production tonnes 18,500
Total
attributable
nickel
production tonnes 38,700
Platinum
segment (4)
Platinum troy ounces 2,569,900
troy ounces 1,448,500
Palladium
Rhodium troy ounces 328,900
troy ounces 4,347,300
Nickel (5) tonnes 18,500
Copper (5) tonnes 10,900
Gold troy ounces 81,300
Equivalent
refined
platinum troy ounces 2,484,000
(1) Includes total concentrate, cathode and copper in sulphate production.
(2) Represents ore mined at Barro Alto for processing at Codemin.
(3) Barro Alto is currently not in commercial production and therefore all
revenue and related costs associated with 1,100 tonnes (six months ended 30
June 2010: nil; year ended 31 December 2010: nil) of production have been
capitalised.
(4) See the published results of Anglo American Platinum Limited for further
analysis of production information.
(5) Also disclosed within total attributable nickel and copper production.
6 months ended
30.06.11
Diamonds segment (De
Beers) (diamonds
recovered - carats)
100% basis (Anglo
American share 45%)
Debswana 11,320,000
Namdeb 599,000
De Beers Consolidated
Mines 2,798,000
Canada 817,000
Total diamonds
production for De
Beers 15,534,000
Anglo American`s
share of diamonds
production for De
Beers 6,990,000
Other Mining and
Industrial segment
(1)
Tarmac
Aggregates tonnes 22,076,100
Lime products tonnes 624,900
Concrete m3 1,691,000
Scaw Metals
South Africa Steel
Products tonnes 356,300
International Steel
Products (2) tonnes -
Copebras
Phosphates tonnes 501,500
Niobium
Catalao
Ore mined tonnes 335,700
Ore processed tonnes 434,200
Ore grade processed Kg Nb/tonne 7.4
Production tonnes 1,800
Zinc and lead
Skorpion (3)
Ore mined tonnes -
Ore processed tonnes -
Ore grade processed Zinc % Zn -
Production Zinc tonnes -
Lisheen (3)
Ore mined tonnes 152,800
Ore processed tonnes 156,200
Ore grade processed Zinc % Zn 13.4
Lead % Pb 2.7
Production Zinc in concentrate tonnes 19,200
Lead in concentrate tonnes 2,900
Black Mountain (3)
Ore mined tonnes 132,800
Ore processed tonnes 126,200
Ore grade processed Zinc % Zn 3.4
Lead % Pb 4.5
Copper % Cu 0.4
Production Zinc in concentrate tonnes 3,300
Lead in concentrate tonnes 5,400
Copper in concentrate tonnes 300
Total attributable
zinc production tonnes 22,500
Total attributable
lead production tonnes 8,300
6 months ended
30.06.10
Diamonds segment (De
Beers) (diamonds
recovered - carats)
100% basis (Anglo
American share 45%)
Debswana 10,267,000
Namdeb 794,000
De Beers Consolidated
Mines 3,589,000
Canada 782,000
Total diamonds
production for De
Beers 15,432,000
Anglo American`s
share of diamonds
production for De
Beers 6,944,000
Other Mining and
Industrial segment
(1)
Tarmac
Aggregates tonnes 33,527,600
Lime products tonnes 628,600
Concrete m3 1,761,500
Scaw Metals
South Africa Steel
Products tonnes 379,000
International Steel
Products (2) tonnes 378,800
Copebras
Phosphates tonnes 471,100
Niobium
Catalao
Ore mined tonnes 809,100
Ore processed tonnes 451,600
Ore grade processed Kg Nb/tonne 6.0
Production tonnes 1,900
Zinc and lead
Skorpion (3)
Ore mined tonnes 811,300
Ore processed tonnes 739,200
Ore grade processed Zinc % Zn 11.4
Production Zinc tonnes 75,700
Lisheen (3)
Ore mined tonnes 765,300
Ore processed tonnes 790,300
Ore grade processed Zinc % Zn 12.2
Lead % Pb 1.6
Production Zinc in concentrate tonnes 87,300
Lead in concentrate tonnes 8,200
Black Mountain (3)
Ore mined tonnes 641,500
Ore processed tonnes 598,100
Ore grade processed Zinc % Zn 3.3
Lead % Pb 4.2
Copper % Cu 0.3
Production Zinc in concentrate tonnes 15,700
Lead in concentrate tonnes 22,600
Copper in concentrate tonnes 1,000
Total attributable
zinc production tonnes 178,700
Total attributable
lead production tonnes 30,800
Year ended
31.12.10
Diamonds segment (De
Beers) (diamonds
recovered - carats)
100% basis (Anglo
American share 45%)
Debswana 22,218,000
Namdeb 1,472,000
De Beers Consolidated
Mines 7,556,000
Canada 1,751,000
Total diamonds production
for De Beers 32,997,000
Anglo American`s share of
diamonds production for
De Beers 14,849,000
Other Mining and
Industrial segment (1)
Tarmac
Aggregates tonnes 58,875,600
Lime products tonnes 1,255,900
Concrete m3 3,305,800
Scaw Metals
South Africa Steel
Products tonnes 710,000
International Steel
Products (2) tonnes 794,200
Copebras
Phosphates tonnes 1,002,000
Niobium
Catalao
Ore mined tonnes 1,209,400
Ore processed tonnes 909,300
Ore grade processed Kg Nb/tonne 6.6
Production tonnes 4,000
Zinc and lead
Skorpion (3)
Ore mined tonnes 1,412,600
Ore processed tonnes 1,358,000
Ore grade processed Zinc % Zn 11.2
Production Zinc tonnes 138,500
Lisheen (3)
Ore mined tonnes 1,531,700
Ore processed tonnes 1,587,600
Ore grade processed Zinc % Zn 12.2
Lead % Pb 1.9
Production Zinc in concentrate tonnes 175,100
Lead in concentrate tonnes 20,600
Black Mountain (3)
Ore mined tonnes 1,415,500
Ore processed tonnes 1,378,600
Ore grade processed Zinc % Zn 3.3
Lead % Pb 4.2
Copper % Cu 0.3
Production Zinc in concentrate tonnes 36,100
Lead in concentrate tonnes 50,600
Copper in concentrate tonnes 2,500
Total attributable zinc
production tonnes 349,700
Total attributable lead
production tonnes 71,200
(1) Production for Coal Americas is included in the Coal production section.
(2) Relates to production from Moly-Cop and AltaSteel. The Group sold its
interests in Moly-Cop and AltaSteel in December 2010.
(3) The Group sold its interest in Skorpion in December 2010 and its interests
in Lisheen and Black Mountain in February 2011.
Quarterly production statistics
30.06.11 31.03.11 31.12.10 30.09.10
Iron Ore and Manganese
segment (tonnes)
Iron ore 11,534,100 9,944,800 11,807,700 11,819,200
Manganese ore (1) 716,100 540,600 731,600 848,800
Manganese alloys (1) (2) 76,100 68,800 76,800 79,600
Metallurgical Coal
segment (tonnes)
Metallurgical 3,642,700 2,056,300 3,651,300 3,971,000
Thermal 3,087,500 3,002,300 3,727,500 3,413,000
Thermal Coal segment
(tonnes) (3)
Metallurgical 83,800 79,500 103,000 111,700
Thermal 7,802,100 7,688,800 8,200,700 8,240,300
Eskom 8,782,600 8,275,000 9,484,800 10,431,300
Copper segment
(tonnes) (4) 150,300 138,800 154,400 153,400
Nickel segment
(tonnes) (5)(6) 6,600 6,100 4,400 5,700
Platinum segment
Platinum (troy ounces) 640,700 532,900 872,400 697,000
Palladium (troy ounces) 373,800 288,200 502,600 404,500
Rhodium (troy ounces) 79,900 85,700 111,400 88,600
Nickel (tonnes) 5,500 4,800 5,000 4,300
Equivalent refined
platinum
(troy ounces) 592,500 567,600 640,100 648,300
Diamonds segment (De
Beers)
(diamonds recovered -
carats)
100% basis (Anglo
American share 45%)
Diamonds 8,138,000 7,396,000 8,532,000 9,033,000
Other Mining and
Industrial
segment (tonnes) (7)
South Africa Steel
Products 183,100 173,200 151,000 180,000
Metallurgical coal 306,700 108,400 240,200 226,400
Zinc (8) - 22,500 77,300 93,700
Lead (8) - 8,300 18,200 22,200
Coal production by commodity
(tonnes) (3)
Metallurgical 4,033,200 2,244,200 3,994,500 4,309,100
Thermal 10,889,600 10,691,100 11,928,200 11,653,300
Eskom 8,782,600 8,275,000 9,484,800 10,431,300
Quarter ended % Change (Quarter ended)
30.06.11 v 30.06.11 v
30.06.10 31.03.11 30.06.10
Iron Ore and Manganese segment (tonnes)
Iron ore 11,458,700 16% 1%
Manganese ore (1) 688,400 32% 4%
Manganese alloys (1) (2) 87,200 11% (13)%
Metallurgical Coal segment (tonnes)
Metallurgical 3,797,900 77% (4)%
Thermal 3,970,200 3% (22)%
Thermal Coal segment (tonnes) (3)
Metallurgical 110,400 5% (24)%
Thermal 7,813,000 1% -
Eskom 8,275,300 6% 6%
Copper segment (tonnes) (4) 154,700 8% (3)%
Nickel segment (tonnes) (5)(6) 5,300 8% 25%
Platinum segment
Platinum (troy ounces) 553,800 20% 16%
Palladium (troy ounces) 294,400 30% 27%
Rhodium (troy ounces) 67,300 (7)% 19%
Nickel (tonnes) 4,800 15% 15%
Equivalent refined platinum
(troy ounces) 601,000 4% (1)%
Diamonds segment (De Beers)
(diamonds recovered - carats)
100% basis (Anglo American share 45%)
Diamonds 8,420,000 10% (3)%
Other Mining and Industrial
segment (tonnes) (7)
South Africa Steel Products 197,000 6% (7)%
Metallurgical coal 206,700 183% 48%
Zinc (8) 91,000 - -
Lead (8) 15,400 - -
Coal production by commodity
(tonnes) (3)
Metallurgical 4,115,000 80% (2)%
Thermal 11,783,200 2% (8)%
Eskom 8,275,300 6% 6%
(1) Saleable production.
(2) Production includes Medium Carbon Ferro Manganese.
(3) Includes Zibulo which is currently not in commercial production and
therefore all revenue and related costs associated with 1,333 kt (six months
ended 30 June 2010: 460 kt; year ended 31 December 2010: 1,662 kt) of
production have been capitalised. The 1,333 kt includes Eskom coal of 397 kt
(six months ended 30 June 2010: 262 kt; year ended 31 December 2010: 765 kt)
and export thermal coal production of 936 kt (six months ended 30 June 2010:
198 kt; year ended 31 December 2010: 897 kt).
(4) Excludes Platinum and Black Mountain mine copper production.
(5) Excludes Platinum nickel production.
(6) Includes Barro Alto which is currently not in commercial production and
therefore all revenue and related costs associated with 1,100 tonnes (six
months ended 30 June 2010: nil; year ended 31 December 2010: nil) of
production have been capitalised.
(7) Excludes Tarmac, Copebras and Catalao.
(8) Zinc and lead production related to the Group`s portfolio of zinc assets,
the sales of which completed in December 2010, in respect of Skorpion, and
February 2011, in respect of Lisheen and Black Mountain.
Exchange rates and
commodity prices
US$ exchange rates 30.06.11 30.06.10 31.12.10
Period end spot prices
Rand 6.78 7.65 6.60
Sterling 0.62 0.67 0.64
Euro 0.69 0.82 0.75
Australian dollar 0.93 1.18 0.98
Chilean peso 469 547 468
Brazilian real 1.56 1.80 1.66
Average prices for the
period
Rand 6.90 7.53 7.32
Sterling 0.62 0.66 0.65
Euro 0.71 0.75 0.75
Australian dollar 0.97 1.12 1.09
Chilean peso 475 525 510
Brazilian real 1.63 1.80 1.76
Commodity prices 30.06.11 30.06.10 31.12.10
Period end spot prices
Iron ore (FOB Australia) (1) US$/tonne 162 125 163
Hard coking coal (FOB
Australia) (2) US$/tonne 330 200 209
Thermal coal (FOB South
Africa) (3) US$/tonne 118 92 129
Thermal coal (FOB
Australia) (3) US$/tonne 120 96 126
Copper (4) US cents/lb 422 295 442
Nickel (4) US cents/lb 1,048 881 1,132
Platinum (5) US$/oz 1,730 1,533 1,755
Palladium (5) US$/oz 762 455 797
Rhodium (5) US$/oz 2,000 2,500 2,425
Average market prices for
the period
Iron ore (FOB Australia) (1) US$/tonne 171 135 136
Hard coking coal (FOB
Australia) (6) US$/tonne 278 165 191
Thermal coal (FOB South
Africa) (3) US$/tonne 121 87 92
Thermal coal (FOB
Australia) (3) US$/tonne 124 97 99
Copper (4) US cents/lb 426 323 342
Nickel (4) US cents/lb 1,159 962 989
Platinum (5) US$/oz 1,792 1,602 1,610
Palladium (5) US$/oz 779 471 527
Rhodium (5) US$/oz 2,304 2,631 2,453
(1) Source: Platts.
(2) Source: 30 June 2011 and 30 June 2010 represent the quarter two
benchmarks; 31 December 2010 represents the quarter four benchmark.
(3) Source: McCloskey.
(4) Source: LME daily prices.
(5) Source: Johnson Matthey.
(6) Source: Six months ended June 2011 represent the average price of the
quarter one and quarter two benchmarks. Six months ended June 2010 and year
ended December 2010 represent the quarterly benchmark, with quarter one 2010
being the final quarter of the annual settlement for JFY 2009-2010.
Summary by business operation
Revenue (1)
6 months 6 months Year
ended ended ended
US$ million 30.06.11 30.06.10 31.12.10
Iron Ore and Manganese 4,196 3,005 6,612
Kumba Iron Ore 3,498 2,375 5,310
Iron Ore Brazil 207 125 319
Samancor 491 505 983
Metallurgical Coal 1,812 1,444 3,377
Australia 1,812 1,444 3,377
Projects and corporate - - -
Thermal Coal 1,693 1,317 2,866
South Africa 1,186 973 2,105
Colombia 507 344 761
Projects and corporate - - -
Copper 2,609 2,142 4,877
Anglo American Sur 1,071 941 2,075
Anglo American Norte 614 477 1,073
Collahuasi 924 724 1,729
Projects and corporate - - -
Nickel 293 209 426
Codemin 108 107 195
Loma de Niquel 185 102 231
Projects and corporate - - -
Platinum 3,760 2,870 6,602
Diamonds 1,750 1,340 2,644
Other Mining and
Industrial 2,179 2,686 5,520
Tarmac (4) 1,197 1,254 2,376
Scaw Metals (5) 483 767 1,579
Copebras 259 165 461
Catalao 69 70 152
Coal Americas 130 90 179
Lisheen (6) 36 116 265
Black Mountain (6) 5 54 197
Skorpion (6) - 170 311
Projects and corporate - - -
Exploration - - -
Corporate Activities
and Unallocated Costs 2 2 5
18,294 15,015 32,929
EBITDA (2)
6 months 6 months Year
ended ended ended
US$ million 30.06.11 30.06.10 31.12.10
Iron Ore and Manganese 2,611 1,711 3,856
Kumba Iron Ore 2,511 1,526 3,514
Iron Ore Brazil (20) (40) (73)
Samancor 120 225 415
Metallurgical Coal 663 416 1,116
Australia 674 427 1,147
Projects and corporate (11) (11) (31)
Thermal Coal 611 433 872
South Africa 384 277 539
Colombia 237 168 358
Projects and corporate (10) (12) (25)
Copper 1,527 1,312 3,086
Anglo American Sur 596 560 1,263
Anglo American Norte 373 293 661
Collahuasi 625 512 1,276
Projects and corporate (67) (53) (114)
Nickel 106 81 122
Codemin 51 61 83
Loma de Niquel 79 36 82
Projects and corporate (24) (16) (43)
Platinum 931 785 1,624
Diamonds 517 340 666
Other Mining and
Industrial 210 427 912
Tarmac (4) 47 101 188
Scaw Metals (5) 44 104 213
Copebras 66 22 104
Catalao 22 31 71
Coal Americas 20 9 18
Lisheen (6) 17 55 114
Black Mountain (6) 3 15 73
Skorpion (6) - 101 154
Projects and corporate (9) (11) (23)
Exploration (46) (57) (136)
Corporate Activities
and Unallocated Costs (18) (34) (135)
7,112 5,414 11,983
Operating profit/(loss) (3)
6 months 6 months Year
ended ended ended
US$ million 30.06.11 30.06.10 31.12.10
Iron Ore and Manganese 2,507 1,628 3,681
Kumba Iron Ore 2,437 1,470 3,396
Iron Ore Brazil (36) (51) (97)
Samancor 106 209 382
Metallurgical Coal 491 263 783
Australia 502 274 814
Projects and corporate (11) (11) (31)
Thermal Coal 521 351 710
South Africa 319 220 426
Colombia 212 143 309
Projects and corporate (10) (12) (25)
Copper 1,401 1,185 2,817
Anglo American Sur 532 494 1,125
Anglo American Norte 355 272 624
Collahuasi 581 472 1,186
Projects and corporate (67) (53) (118)
Nickel 93 68 96
Codemin 49 57 76
Loma de Niquel 69 26 65
Projects and corporate (25) (15) (45)
Platinum 542 418 837
Diamonds 450 261 495
Other Mining and
Industrial 101 290 661
Tarmac (4) (22) 29 48
Scaw Metals (5) 27 83 170
Copebras 54 12 81
Catalao 21 28 67
Coal Americas 10 (1) (3)
Lisheen (6) 17 54 114
Black Mountain (6) 3 15 73
Skorpion (6) - 81 134
Projects and corporate (9) (11) (23)
Exploration (46) (57) (136)
Corporate Activities
and Unallocated Costs (36) (46) (181)
6,024 4,361 9,763
Underlying earnings
6 months 6 months Year
ended ended ended
US$ million 30.06.11 30.06.10 31.12.10
Iron Ore and Manganese 902 614 1,423
Kumba Iron Ore 824 520 1,210
Iron Ore Brazil (24) (42) (77)
Samancor 102 136 290
Metallurgical Coal 351 177 585
Australia 362 188 616
Projects and corporate (11) (11) (31)
Thermal Coal 385 258 512
South Africa 249 167 314
Colombia 146 103 223
Projects and corporate (10) (12) (25)
Copper 842 706 1,721
Anglo American Sur 318 302 685
Anglo American Norte 219 170 419
Collahuasi 374 287 738
Projects and corporate (69) (53) (121)
Nickel 58 64 75
Codemin 32 41 48
Loma de Niquel 37 32 55
Projects and corporate (11) (9) (28)
Platinum 285 222 425
Diamonds 299 148 302
Other Mining and
Industrial 62 218 522
Tarmac (4) (25) 25 67
Scaw Metals (5) 18 52 119
Copebras 43 5 48
Catalao 13 17 38
Coal Americas 7 1 1
Lisheen (6) 14 47 99
Black Mountain (6) 1 11 47
Skorpion (6) - 79 133
Projects and corporate (9) (19) (30)
Exploration (45) (55) (128)
Corporate Activities
and Unallocated Costs (19) (140) (461)
3,120 2,212 4,976
(1) Revenue includes the Group`s attributable share of revenue of joint
ventures and associates. Revenue for copper and zinc operations is shown after
deduction of treatment and refining charges (TC/RCs).
(2) Earnings before interest, tax, depreciation and amortisation (EBITDA) is
operating profit before special items, remeasurements, depreciation and
amortisation in subsidiaries and joint ventures and includes attributable
share of EBITDA of associates.
(3) Operating profit includes operating profit before special items and
remeasurements from subsidiaries and joint ventures and attributable share of
operating profit (before interest, tax, non- controlling interests, special
items and remeasurements) of associates.
(4) In the first half of 2010 Tarmac sold its Polish and French and Belgian
concrete products businesses and in the second half of 2010, the majority of
its European Aggregates businesses.
(5) Included Moly-Cop and AltaSteel, which were disposed of in December 2010.
(6) Skorpion, Lisheen and Black Mountain comprised the Group`s portfolio of
operating zinc assets. The Group sold its interest in Skorpion in December
2010 and its interests in Lisheen and Black Mountain in February 2011. See
Disposals note 13.
Reconciliation of subsidiaries` and associate`s reported earnings to the
underlying earnings included in the Condensed financial statements
for the six months ended 30 June 2011
Only key reported lines are reconciled
Kumba Iron Ore Limited
6 months ended 6 months ended Year ended
US$ million 30.06.11 30.06.10 31.12.10
IFRS headline earnings (US$
equivalent of published) 1,319 864 1,964
Exploration - 3 9
Other adjustments 1 - 1
1,320 867 1,974
Non-controlling interests (459) (325) (710)
Elimination of intercompany interest (12) 1 2
Depreciation on assets fair
valued on acquisition (net of tax) (5) (4) (9)
Corporate cost allocation (20) (19) (47)
Contribution to Anglo
American plc underlying earnings 824 520 1,210
Anglo American Platinum Limited
6 months ended 6 months ended Year ended
US$ million 30.06.11 30.06.10 31.12.10
IFRS headline earnings (US$
equivalent of published) 469 340 674
Exploration Operating and financing
remeasurements (net of tax) (51) (17) (21)
Restructuring costs included
in headline earnings (net of
tax) 6 11 28
Other adjustments 2 (3) (1)
428 335 691
Non-controlling interests (87) (68) (140)
Elimination of intercompany interest (1) 26 29
Depreciation on assets fair
valued on acquisition (net of tax) (30) (47) (102)
(25) (24) (53)
Corporate cost allocation
Contribution to Anglo
American plc underlying earnings 285 222 425
De Beers Societe Anonyme
6 months ended 6 months ended Year ended
US$ million 30.06.11 30.06.10 31.12.10
De Beers underlying earnings (100%) 666 304 598
Difference in IAS 19 accounting policy (1) 14 53
De Beers underlying earnings
- Anglo American plc basis (100%) 665 318 651
Anglo American plc`s 45%
ordinary share interest 299 143 293
Income from preference shares - 8 9
Other adjustments - (3) -
Contribution to Anglo
American plc underlying earnings 299 148 302
ANGLO AMERICAN plc
(Incorporated in England and Wales - Registered number 3564138)
(the Company)
Notice of Interim Dividend
(Dividend No. 22)
Notice is hereby given that an interim dividend on the Company`s ordinary
share capital in respect of the year to 31 December 2011 will be paid as
follows:
Amount (United States currency) 28 cents per ordinary share (note 1)
Amount (South African currency) R1.8598 per ordinary share
Last day to effect removal of shares
between the UK and SA registers Thursday 28 July 2011
Last day to trade on the JSE Limited
(JSE) to qualify for dividend Friday 12 August 2011
Ex-dividend on the JSE from the
commencement of trading on Monday 15 August 2011 (note 2)
Ex-dividend on the London Stock Exchange
from the commencement of trading on Wednesday 17 August 2011
Record date (applicable to both the
United Kingdom principal register and
South
African branch register) Friday 19 August 2011
Last day for receipt of US$:GBP/ currency
elections by the UK Registrars (note 1) Wednesday 24 August 2011
Last day for receipt of Dividend
Reinvestment Plan (DRIP) mandate forms by
the UK
Registrars (notes 3, 4 and 5) Wednesday 24 August 2011
Currency conversion US$:GBP/ rates
announced on Friday 2 September 2011
Removal of shares between the UK and SA
registers permissible from Friday 2 September 2011
Last day for receipt of DRIP mandate
forms by Central Securities Depository
Participants (CSDPs) (notes 3, 4 and 5) Friday 2 September 2011
Last day for receipt of DRIP mandate
forms by the South African Transfer
Secretaries (notes 3, 4 and 5) Monday 5 September 2011
Dividend warrants posted Wednesday 14 September 2011
Payment date of dividend Thursday 15 September 2011
Notes
1. Shareholders on the United Kingdom register of members with an address in
the United Kingdom will be paid in pounds sterling and those with an address
in a country in the European Union which has adopted the euro, will be paid in
euros. Such shareholders may, however, elect to be paid their dividends in US
dollars provided the UK Registrars receive such election by Wednesday 24
August 2011. Shareholders with an address elsewhere will be paid in US dollars
except those registered on the South African branch register who will be paid
in South African rand.
2. Dematerialisation and rematerialisation of registered share certificates in
South Africa will not be effected by CSDPs during the period from Monday 15
August 2011 to Friday 19 August 2011 (both days inclusive).
3. Those shareholders who already participate in the DRIP need not complete a
DRIP mandate form for each dividend as such forms provide an ongoing authority
to participate in the DRIP until cancelled in writing. Shareholders who wish
to participate in the DRIP should obtain a mandate form from the UK
Registrars, the South African Transfer Secretaries or, in the case of those
who hold their shares through the STRATE system, their CSDP.
4. In terms of the DRIP, and subject to the purchase of shares in the open
market, share certificates/CREST notifications are expected to be mailed and
CSDP investor accounts credited/updated on Wednesday 21 September 2011 in the
UK and Friday 23 September 2011 in South Africa. CREST accounts will be
credited on Wednesday 21 September 2011.
5. Copies of the terms and conditions of the DRIP are available from the UK
Registrars or the South African Transfer Secretaries.
Registered office
20 Carlton House Terrace
London
SW1Y 5AN
England
UK Registrars
Equiniti
Aspect House
Spencer Road
Lancing
West Sussex
BN99 6DA
England
South African Transfer Secretaries
Link Market Services South Africa (Pty) Limited
11 Diagonal Street
Johannesburg 2001
South Africa
(PO Box 4844, Johannesburg 2000)
29 July 2011
Sponsor: UBS South Africa (Pty) Ltd
Date: 29/07/2011 08:00:06 Produced by the JSE SENS Department.
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