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ANG
ANANO
ANG - Anglogold Ashanti Limited - Report to shareholders for the quarter and six
months ended 30 June 2011 Group results for the quarter....
ANGLOGOLD ASHANTI LIMITED
Registration No. 1944/017354/06
Incorporated in the Republic of South Africa
Share codes:
ISIN: ZAE000043485
JSE: ANG
LSE: AGD
NYSE: AU
ASX: AGG
GhSE (Shares): AGA
GhSE (GhDS): AAD
Euronext Paris: VA
Euronext Brussels: ANG
JSE Sponsor: UBS
Report to shareholders for the quarter and six months ended 30 June 2011
Group results for the quarter....
- Adjusted headline earnings rise 68% to record $342m, or 89 US cents per share.
- Interim dividend rises 38% to 90 South African cents per share, or 44% to 13
US cents per ADS.
- Total cash costs at $705/oz, well within guidance; production up 5% to
1.086Moz.
- Operating improvements and gold price drive cash flow from operations 24%
higher to $635m.
- Free cash flow at $207m after capex, finance costs and tax; net debt lowered
to $866m.
- Continental Africa posts output growth and 14% cost reduction; Obuasi and
Geita improve.
- South African production up 7%, shows good cost control despite currency gain
and increased power tariff.
- Uranium production of 338klbs and silver production of 642koz.
- Americas region grows production 6%, keeps costs flat in challenging
inflationary environment.
- Cerro Vanguardia`s output gains 7%; total cash costs drop 39%, the lowest in
the group at $264/oz.
- Brownfield exploration campaigns in Argentina, Brazil and Australia return
high grade intersections.
Quarter
ended ended ended
Jun Mar Jun
2011 2011 2010
SA rand / Metric
Operating review
Gold
Produced - kg / oz (000) 33,776 32,303 35,011
Price received - R/kg / $/oz 328,951 312,261 265,806
Total cash costs - R/kg / $/oz 153,441 158,707 149,365
Total production costs - R/kg / $/oz 199,541 200,632 183,891
Financial review
Adjusted gross profit - Rm / $m 4,268 3,464 2,723
Profit (loss) attributable
to equity
shareholders - Rm / $m 3,195 1,658 (1,360)
- cents/share 829 430 (371)
Adjusted headline earnings - Rm / $m 2,317 1,415 980
- cents/share 601 367 267
Cash flow from operating
activities - Rm / $m 4,298 3,607 2,963
Capital expenditure - Rm / $m 2,342 1,740 1,703
Six months
ended ended
Jun Jun
2011 2010
SA rand / Metric
Operating review
Gold
Produced - kg / oz (000) 66,079 68,586
Price received - R/kg / $/oz 320,702 255,564
Total cash costs - R/kg / $/oz 156,015 149,397
Total production costs - R/kg / $/oz 200,075 187,065
Financial review
Adjusted gross profit - Rm / $m 7,732 4,360
Profit (loss) attributable to equity
shareholders - Rm / $m 4,854 (210)
- cents/share 1,259 (57)
Adjusted headline earnings - Rm / $m 3,733 1,442
- cents/share 968 393
Cash flow from operating activities - Rm / $m 7,905 4,289
Capital expenditure - Rm / $m 4,082 2,986
Quarter
ended ended ended
Jun Mar Jun
2011 2011 2010
US dollar / Imperial
Operating review
Gold
Produced - kg / oz (000) 1,086 1,039 1,126
Price received - R/kg / $/oz 1,510 1,391 1,095
Total cash costs - R/kg / $/oz 705 706 617
Total production costs - R/kg / $/oz 916 893 759
Financial review
Adjusted gross profit - Rm / $m 629 497 359
Profit (loss) attributable to
equity
shareholders - Rm / $m 470 241 (187)
- cents/share 122 62 (51)
Adjusted headline earnings - Rm / $m 342 203 129
- cents/share 89 53 35
Cash flow from operating
activities - Rm / $m 635 513 386
Capital expenditure - Rm / $m 346 249 226
Six months
ended ended
Jun Jun
2011 2010
US dollar / Imperial
Operating review
Gold
Produced - kg / oz (000) 2,124 2,205
Price received - R/kg / $/oz 1,451 1,056
Total cash costs - R/kg / $/oz 705 618
Total production costs - R/kg / $/oz 905 774
Financial review
Adjusted gross profit - Rm / $m 1,126 578
Profit (loss) attributable to equity
shareholders - Rm / $m 711 (30)
- cents/share 184 (8)
Adjusted headline earnings - Rm / $m 544 190
- cents/share 141 52
Cash flow from operating activities - Rm / $m 1,148 566
Capital expenditure - Rm / $m 594 397
$ represents US dollar, unless otherwise stated.
Rounding of figures may result in computational discrepancies.
Operations at a glance
for the quarter ended 30 June 2011
Production Total cash costs
oz (000 % Variance 1 $/oz % Variance 1
SOUTH AFRICA 431 7 688 8
Great Noligwa 27 23 1,071 (11)
Kopanang 83 4 684 16
Moab Khotsong 75 10 663 13
Mponeng 127 8 566 10
Savuka 12 9 876 5
TauTona 60 11 848 (1)
Surface Operations 48 - 588 9
CONTINENTAL AFRICA 377 4 705 (14)
Ghana
Iduapriem 44 (21) 891 25
Obuasi 83 19 732 (28)
Guinea
Siguiri - Attributable 85% 66 2 801 19
Mali
Morila - Attributable 40% 2 25 14 826 (1)
Sadiola - Attributable 41%
2 33 10 687 (2)
Yatela - Attributable 40% 2 6 (14) 1,280 (8)
Namibia
Navachab 14 (18) 1,202 26
Tanzania
Geita 107 14 441 (46)
Non-controlling interests,
exploration
and other
AUSTRALASIA 61 (15) 1,595 38
Australia
Sunrise Dam 61 (15) 1,516 40
Exploration and other
AMERICAS 216 6 487 1
Argentina
Cerro Vanguardia -
Attributable 92.50% 48 7 264 (39)
Brazil
AngloGold Ashanti Mineracao 84 - 493 11
Serra Grande -
Attributable 50% 14 (18) 881 24
United States of America
Cripple Creek & Victor 70 23 546 11
Non-controlling interests,
exploration
and other
OTHER
Sub-total 1,086 5 705 -
Equity accounted
investments included above
AngloGold Ashanti
Adjusted
gross profit (loss)
$m $m Variance 1
SOUTH AFRICA 264 54
Great Noligwa 6 8
Kopanang 48 8
Moab Khotsong 37 8
Mponeng 102 15
Savuka 7 1
TauTona 21 10
Surface Operations 43 3
CONTINENTAL AFRICA 244 81
Ghana
Iduapriem 18 (6)
Obuasi 49 35
Guinea
Siguiri - Attributable 85% 43 (2)
Mali
Morila - Attributable 40% 2 16 5
Sadiola - Attributable 41% 2 25 5
Yatela - Attributable 40% 2 1 1
Namibia
Navachab 2 (4)
Tanzania
Geita 83 47
Non-controlling interests, exploration
and other 8 1
AUSTRALASIA (10) (15)
Australia
Sunrise Dam (5) (16)
Exploration and other (5) -
AMERICAS 151 (5)
Argentina
Cerro Vanguardia - Attributable 92.50% 48 16
Brazil
AngloGold Ashanti Mineracao 47 (19)
Serra Grande - Attributable 50% (3) (9)
United States of America
Cripple Creek & Victor 59 17
Non-controlling interests, exploration
and other - (10)
OTHER 21 28
Sub-total 670 143
Equity accounted investments included above (41) (10)
AngloGold Ashanti 629 132
1 Variance June 2011 quarter on March 2011 quarter - increase (decrease).
2 Equity accounted joint ventures.
Rounding of figures may result in computational discrepancies.
Financial and Operating Report
OVERVIEW FOR THE QUARTER
FINANCIAL AND CORPORATE REVIEW
Operating production and cost performances in South Africa, Continental Africa
and the Americas, along with full exposure to the record gold price drove marked
improvements in earnings and cash flow generation during the second quarter.
Adjusted headline earnings surged by 68% to a record $342m, or 89 US cents a
share in the three months to 30 June, compared with $203m, or 53 US cents the
previous quarter.
Net profit attributable to equity shareholders rose from $241m recorded in the
first quarter to $470m for the second quarter. This increase was on the back of
improved earnings and fair value gains on the two convertible bonds.
Cash generated from operating activities improved by 24%, to $635m during the
period under review. Free cash flow, after all capital expenditure, finance
costs and tax, was $207m. These robust inflows helped further strengthen the
group`s balance sheet. Net debt (excluding the mandatory convertible bond) was
further reduced to $866m at the end of the quarter, from $1.1bn at the end of
March. About two-thirds of AngloGold Ashanti`s targeted capital expenditure for
the year of $1.6bn will be spent over the remainder of the year, with a
commensurate impact on net debt in the second half.
Given the improved cash flow, the board has declared a dividend of 90 South
African cents per share, an increase of 38% over the corresponding period last
year. The increase is largely in line with the improvement in the gold price
over the period and reflects AngloGold Ashanti`s desire to improve returns to
shareholders while retaining the capacity to fund its growth projects.
OPERATING RESULTS
Production and total cash costs for the three months to 30 June 2011, a period
impacted by 5 public holidays and a local government election in South Africa,
were broadly in line with guidance at 1.086Moz at $705/oz, compared with
1.039Moz at $706/oz the previous quarter. Guidance for the second quarter was
1.09Moz at a total cash cost of $760/oz.
The cost performance was bolstered by improved production and efficiencies at
key assets, greater by-product credits and stockpiling of ore during the
shutdown and repair of the SAG mill at Geita during the quarter. Continental
Africa delivered good production gains coupled with a 14% drop in total cash
costs, while South Africa and the Americas showed rising production and good
cost control at key assets. Australia continued to face challenges following the
first quarter`s flooding, as wet weather hampered recovery efforts. Group total
cash costs were marginally better than the previous quarter despite increased
power tariffs in South Africa.
SAFETY
Tragically, three fatalities occurred during the quarter in separate incidents
following a seismic event at Mponeng, surface accident at the Cuiaba mine in
Brazil and at an exploration site in Eritrea. Continued focus on mitigating
risks in the workplace, through visible leadership at each operation and
implementation of the Safety Transformation component of Project ONE, remains a
priority for each member of the company. AngloGold Ashanti`s fatality frequency
rate has improved by 73% since 2007 and is some 60% better than its local peer
group. The company`s all injury frequency rate of 10 injuries per million hours
worked was the lowest in AngloGold Ashanti`s history, indicating that efforts
toward effecting a comprehensive change in attitude toward safety across every
level in the group are gaining traction. South Africa and Continental Africa
fared especially well in this regard during the quarter. There remains, as
always, room for further improvement.
OPERATING REVIEW
The South African operations produced 431,000oz at a total cash cost of $688/oz
in the second quarter of 2011, compared with 401,000oz at a total cash cost of
$637/oz in the previous quarter. The increase in production resulted from
continued operational improvements following the seasonally slow first quarter.
The increase in total cash costs was contained to 8%, despite a stronger rand,
winter electricity tariffs and higher royalties triggered by the rising gold
price. At the West Wits operations, production from Mponeng, the company`s
largest mine, increased by 8% to 127,000oz after temperature constraints and
safety related production stoppages which hampered operations in the first
quarter, were addressed. Neighbouring TauTona experienced yield improvements
following a release of tons locked up in the VCR shaft area and achieved higher
volumes mined.
These factors together afforded a 11% increase in gold production to 60,000oz,
at a total cash cost of $848/oz. At the Vaal River operations, production at
Moab Khotsong increased by 10% to 75,000oz, after operational constraints
related to high temperatures and compressed air, which affected the previous
quarter, were addressed. Kopanang managed a 4% increase in production to
83,000oz following fewer safety related stoppages, which led to improved area
mined and tons milled. Total cash costs, however, increased by 16% to $684/oz
due to winter electricity tariffs and royalties. Great Noligwa was another
beneficiary of fewer safety- related interruptions as well as a resolution to
ore pass blockages that impacted the previous quarter. The mine posted a 23%
increase in production to 27,000oz. Surface Operations production remained at
48,000oz, however total cash costs increased 9% to $588/oz.
The Continental Africa operations produced 377,000oz at a total cash cost of
$705/oz in the second quarter of 2011, compared with 363,000oz at a total cash
cost of $819/oz the previous quarter. In Ghana, Obuasi staged a strong operating
performance with a 19% increase in production to 83,000oz and a 28% improvement
in total cash costs to $732/oz. The improvement stemmed principally from
improved availability of underground equipment, a successful drive to improve
consistency in plant operations and access to higher grade blocks. Iduapriem,
where the plant underwent a scheduled maintenance shutdown, posted a planned 21%
decline in output to 44,000oz and a resultant increase in total cash costs to
$891/oz. Notwithstanding a shutdown to repair and upgrade one of the ends on the
SAG mill, Geita, in Tanzania, benefited from higher grades mined at the
Nyankanga and Geita Hill pits. Production at the mine rose 14% to 107,000oz,
while total cash costs dropped 46% to $441/oz. In Mali, improved grades and
throughput pushed production from Sadiola 10% higher to 33,000oz, while total
cash costs improved marginally to $687/oz. Morila`s production rose 14% to
25,000oz as higher grades were processed from stockpiles. In Guinea, Siguiri`s
production increased marginally to 66,000oz, but increased royalties following
the higher gold price, along with rising fuel prices and use of consumables
drove total cash costs 19% higher to $801/oz. Navachab, in Namibia, continued to
face challenges related to its DMS plant, compounded by lower recovered grades
and tonnages. Production fell 18% to 14,000oz and total cash costs rose 26% to
$1,202/oz.
The Americas operations produced 216,000oz at a total cash cost of $487/oz in
the second quarter of 2011, compared with 203,000oz at a total cash cost of
$480/oz in the previous quarter. In Argentina, Cerro Vanguardia delivered
another strong performance with higher grades driving a 7% rise in production to
48,000oz. Higher silver prices helped push total cash costs 39% lower to
$264/oz, again the lowest for the group. In Brazil, Serra Grande faced dilution
issues and lower recoveries due to challenges experienced with filtration. Both
issues have been addressed. Production fell 18% to 14,000oz, while total cash
costs rose 24% to $881/oz. At AngloGold Ashanti Corrego do Sitio Mineracao
(AngloGold Ashanti Mineracao), production was unchanged at 84,000oz, as higher
tonnages offset lower grades. A better performance from the underground fleet at
Cuiaba offset the effects of lower grade, a stronger real and general cost
inflation in Brazil. Total cash costs rose 11% to $493/oz. In the US, Cripple
Creek & Victor`s production increased by 23% to 70,000oz as ore was placed on
newer sections of the pad, closer to the liner. Total cash costs rose 11% to
$546/oz, due mainly to higher diesel prices and mining costs.
Australasia produced 61,000oz at a total cash cost of $1,595/oz in the second
quarter of 2011, compared with 72,000oz at a total cash cost of $1,153/oz the
previous quarter. This quarter`s figure includes a non-cash deferred stripping
charge of $93/oz. The pit-wall slippage at Sunrise Dam, together with the
continued impact of the previous quarter`s flood, severely affected all aspects
of the operation. Mining in the open pit was suspended during the quarter while
dewatering the underground mine remained a priority. Additional support work
required for the switchback to the main access ramp was also undertaken during
the quarter, extending the period needed to remediate the operation.
PROJECTS
AngloGold Ashanti incurred capital expenditure of $346m during the quarter, of
which $126m was spent on growth projects. Of the growth-related capital, $61m
was spent in the Americas, $30m was spent in Continental Africa, $16m in
Australasia and $19m in South Africa.
The team at the Corrego do Sitio project, in Brazil, continued to make swift
progress, despite stiff competition for skilled engineering personnel in Brazil.
Full production for the first phase of the project, estimated at 140,000oz a
year, remained on schedule for 2013. Drainage for the stockpiles at the site was
completed, water treatment piping installed and tested and civil engineering
work for the crushing and milling circuit finished. Installation of the SAG,
primary-ball and regrind mills was also finished and the lining of the autoclave
and the conditioning tank completed. Commissioning of the milling and flotation
areas will get underway during the third quarter. Work on the Sao Bento plant
also continued during the quarter, with key equipment refurbished, including the
existent flotation cells and warehouse and laboratory facilities. In the mining
area, ore production reached 40,800 tons during the quarter.
At the Tropicana Gold Project (AngloGold Ashanti 70% and manager) and
Independence Group NL (30%) construction works focused predominantly on the
220km long site access road during the quarter. Although heavy rain in June
caused work to be suspended for 11 days, the road remains on schedule to be
completed in the fourth quarter.
During the second quarter, the open pit mining contract was finalised and
awarded to Macmahon Holdings Ltd.
Procurement negotiations are underway on the long lead-time major equipment
packages and detailed engineering design is on track for completion ahead of the
start of processing plant construction in the second quarter of 2012.
Recruitment of the Tropicana Gold Mine management team has been completed.
The Mineral Resource and Ore Reserve at Tropicana was updated as at 30 June 2011
to reflect recent increases in the gold price and changes to the resource model
through increased drill density in the Havana South and Boston Shaker zones. The
Ore Reserve increased by 540,000 ounces to 56.4 Mt grading 2.16g/t Au containing
3.91Moz of gold whilst the Measured, Indicated and Inferred Resource estimate
increased slightly to 78.6Mt grading 2.12g/t Au for 5.36Moz of gold.
The increased Ore Reserve was primarily due to the inclusion of the Boston
Shaker pit, which added 243,000oz, and conversion of Inferred Resources into
Indicated status at Havana South, which added a further 257,000oz Au. Although
drilling activities on the mining leases during the quarter were constrained by
rain, three multi- purpose RC rigs are on site, with drilling predominantly
focused on Havana Deeps.
Shallow drilling has been completed in the Swizzler area (between the Tropicana
and Havana pits) where there is potential for the two pits to merge. Better RC
drill results from Swizzler included: TFRC3531 15m at 3.6g/t Au from 98m; TFRC
3560 16m @ 3.8g/t Au from 127m TFRC3562 5.0m at 5.2g/t Au from 139m. Limited
diamond drilling was completed down dip of Swizzler and one hole (TFD421)
returned an encouraging 6m @ 19.2g/t Au from 255m. A follow up programme of
RC/Diamond drilling has commenced to assess the Swizzler Deeps area.
A pre-feasibility study, including substantial drilling programmes, is being
carried out to evaluate open pit and underground mining options of the Havana
Deeps mineralisation. A total of 20,600m of RC and diamond drilling was
completed in the quarter. Only limited assays have been returned to date with a
best result of 14m @ 6.5g/t Au from 421m in HDD077.
At the Kibali joint venture, in the Democratic Republic of the Congo, work
commenced in July on the relocation of the inhabitants of 14 villages affected
by the development of the mine, which remains on track to yield first production
in 2014. Kokiza, as the new settlement is called, will ultimately comprise more
than 3,500 houses accommodating about 15,000 people, a Catholic Church complex
and other places of worship, schools, seven medical centres, five public market
places and a government office. Transport infrastructure built to serve the town
will consist of 50km of primary roads in addition to the 20km of secondary roads
already constructed. Randgold Resources, which also owns a 45% stake in the
project, is Kibali`s operator and project manager. The expected date to complete
the Kibali project feasibility study is Quarter 4 2011.
The feasibility study for the Mongbwalu project, in which AngloGold Ashanti owns
a 86.22% stake, and is also in the DRC, is currently undergoing an optimization
by the Business and Technical Development team. The project is expected to be
submitted to the board for approval later this year.
EXPLORATION
Total exploration expenditure during the second quarter, inclusive of
expenditure at equity accounted joint ventures, was $82m ($32m on brownfield,
$27m on greenfield and $23m on pre-feasibility studies), compared with $71m the
previous quarter ($26m on brownfield, $25m on greenfield and $20m on pre-
feasibility studies).
The following are highlights from the company`s exploration activities during
the quarter. More detail on AngloGold Ashanti`s exploration programme can be
found at www.anglogoldashanti.com.
Greenfield exploration activities were undertaken in six regions (Australia,
Americas, Pacific, Sub-Saharan Africa and the Middle East & North Africa) during
Q2 2011. A total of 60,453 metres of diamond, RC and AC drilling was completed
at existing priority targets and used to delineate new targets in Australia,
Colombia, Argentina, Guinea, Gabon, the DRC, Egypt, Ethiopia, Brazil and the
Solomon Islands.
In Australia, at the Tropicana JV (AngloGold Ashanti 70%, Independence Group
30%), exploration continued during the second quarter following up significant
results from previous work. Significant results were received from aircore
drilling during the quarter for several prospects including Iceberg, 35km south
of Tropicana, where 20m @ 0.99g/t Au was intersected from 32m, including 8.0m @
2.19g/t Au from 40m. At Margarita, 10km SW of Tropicana, results included 1m at
1.76g/t Au from 45m. At Ninja, 15km WSW of Tropicana - Havana, results included
2m at 1.01g/t Au.
Brownfield drilling on the Vogue discovery, beneath the current workings at
Sunrise Dam has continued, yielding positive results. Drilling confirms a broad
zone of significant mineralisation beneath current workings at depths ranging
from 600m to 800m. Bulked intercepts across the entire zone include: 166m @
4.7g/t Au and 229m @ 5.1g/t Au.
Greenfields exploration in the Americas during the second quarter of 2011
continued focusing on early stage exploration in Colombia, Canada, USA, Brazil
and Argentina. In Colombia exploration programmes were undertaken in four
separate regions. A 3,000m diamond drilling programme and sampling and mapping
was completed at the Nuevo Chaquiro prospect around Quebradona. Elsewhere,
mapping and sampling programmes were undertaken at the La Llanada, La Vega and
Anaima-Tocha Belt. Geophysical programmes included the commencement of regional
airborne magnetic and radiometric surveys, utilising two helicopter borne
systems.
In Brazil, drilling commenced at the Falcao Project, a joint venture with
Horizonte Minerals. Regional geochemical sampling programmes were undertaken
over the Santana JV area and Juruena project areas. In Argentina exploration
drilling started at El Volcan on targets defined by earlier drill programmes.
In the Solomon Islands, exploration activities continued at the Kele and Mase
Joint Ventures with XDM Resources, while tenement applications associated with
two additional Joint Venture agreements covering the New Georgia and Vangunu
project areas progressed. At Mase, diamond drilling was restarted during May
with a total of 247m completed during the quarter. At Kele diamond drilling
continued with 1,370m completed during the quarter. Here, mechanical cutting and
sampling of 4.52km of trenches focussed in the Tango West, Konga and Kukumbokulu
prospect areas.
In Sub-Saharan Africa, project generation work is ongoing and new conceptual
targets to guide longer term strategies in Africa have been developed.
In the Democratic Republic of the Congo, regional exploration continued on
Ashanti Goldfields Kilo (AGK) 5,487km2 Kilo project. Greenfield exploration
activities continued in six projects Lodjo, Issuru, Dala, Alosi Camp 3, Mont Tsi
and Petsi. Five diamond holes were drilled at Mont Tsi and drilling has
commenced at Issuru to the north of the Mongbwalu project area. Drilling will
recommence at Mont Tsi after the completion of a ground geophysical survey.
In Gabon, drilling continued at La Mboumi West and Central on the Ndjole
licence, a joint venture with Dome Ventures, Renewal applications have been
completed for the Ndjole & Mevang JV licences. Geochemical soil sampling and
mapping continues over La Mboumi as well as AGA`s Eteke North (Ogooue licence).
In Guinea, regional exploration work, including soil sampling and drilling
programmes on Blocks 2, 3 and 4 in the Siguiri Mine region. A total of 7,360
geochemical soil samples were collected. Encouraging gold in soil geochemical
anomalies were revealed by this work.
Additional resource delineation and definition drilling was completed at Saraya
in late June. A total of 2,969m of diamond and 3,646m of RC drilling was
completed. Assay results from infill drilling include apparent thickness
intercepts of 18m @ 5.4g/t Au from 80m, 9m @ 4.91g/t Au from146m and 14m @
1.9g/t Au from 190 in SARC277 and: 14m @ 1.25g/t Au from 110m in SARCDD007.
Delineation and infill drilling commenced at Kounkoun, located in Block 3, where
twelve holes totalling 2,346m were completed during the quarter, while assay
results from this work are pending.
Greenfields exploration in the Middle East & North Africa region is being
undertaken by Thani Ashanti; a 50:50 Strategic Alliance between AngloGold
Ashanti and Thani Investments. Exploration during Q2 involved diamond drilling
at the Hutite prospect, located on the Hodine licence in Egypt. Here 3,043m of
diamond drilling was completed during the quarter and results include: 3m @
4.83g/t Au from 55m, 5m @ 4.61g/t Au from 152m and 5m @ 1.42g/t Au from 163m in
HUD004. Most significant results returned this quarter are from the 1,000m long
Central Zone, where mineralisation has been intersected in all seven holes
drilled to date.
In Eritrea, follow-up stream sediment geochemistry and mapping is in progress
over the targets identified from the 10,000 line km airborne EM, magnetic and
radiometric survey at the Kerkasha and Akordat North exploration licences.
The Afar JV with Stratex International has commenced diamond drilling at the
Megenta project in Ethiopia. As part of this agreement, Thani Ashanti has a
minimum exploration commitment of $1m, and can earn 51% interest in the licences
by spending $3m. Results from the upper portion of the first hole contain
several
0.5g/t Au results and some >1g/t Au intercepts from narrow veins. The
results are consistent with the envisaged mineralisation model. AngloGold
Ashanti increased its stake in Stratex International to an interest of
approximately 11.2% through a $5m private placement, meeting the SARB investment
requirements of a minimum of 10%.
Twenty four exploration licence applications were submitted in Saudi Arabia. The
applications form a contiguous block of 2,356km2.
OUTLOOK
Operations were impacted during the first half of the year by a number of
factors, which would in themselves have led annual production to the lower end
of initial guidance of 4.55Moz to 4.75Moz. These include flooding at Sunrise
Dam, the decision to stop mining the shaft pillar at TauTona for safety reasons,
drought at Cripple Creek & Victor which impacted optimal functioning of the
leach pad and lower-than-anticipated grades at Siguiri.
As a result of the operational impacts as outlined above and the strike in South
Africa at the end of July, the year guidance is being revised to around 4.45Moz.
The lower production, along with higher fuel prices and stronger local operating
currencies in Brazil and South Africa result in total cash cost guidance of
$725/oz-$740/oz, This assumes an oil price of $114/barrel and average exchange
rate of R6.83/$ and equivalent Australian dollar and Brazilian real rates.
Third quarter production is expected to be around 1.11Moz at a total cash cost
of $775/oz. This assumes an oil price of $115/barrel and average exchange rate
of R6.75/$ and equivalent Australian dollar and Brazilian real rates.
Review of the Gold Market
Gold price movement and investment markets
Gold price data
During April, the gold price continued to benefit from ongoing economic
uncertainty in Europe and the United States, receiving an additional boost from
the threat to the triple A credit rating of the United States. Bullion traded to
an intraday high of $1,575/oz at the start of May. However this momentum was not
sustained and after a brief correction, the price traded sideways for the
balance of the quarter. Many of the factors that drove gold in the first month
of the quarter persisted as the European debt crisis worsened. Domestic politics
and brinkmanship in the United States saw the debt ceiling impasse adding yet
more uncertainty to global financial markets, adding to the metal`s tailwind.
Although the latter is likely to be resolved, the ongoing sovereign solvency
turmoil in Europe should underpin the gold price going forward. Despite the
modest 4.5% increase in the average gold price in the quarter under review, the
increase marks the 10th consecutive quarter of growth and represents gold`s
longest winning streak since the 1920s.
Investment demand
ETF holdings for the quarter remained fairly stagnant with net investment for
the quarter at around 1.2Moz, growth of less than 2% from its opening position.
In contrast, during the second quarter of last year when similar concerns over
sovereign risk were escalating, ETF holdings grew by around 9Moz. Not
surprisingly, most of the growth can be attributed to European ETFs. The COMEX
net long position posted a high of 30.5Mozs in the second quarter, which
unsurprisingly coincided with the run in the gold price. Global estimated bar
and coin demand from the December 2010 quarter to the June 2011 quarter stands
at 1,396 tons, a 49% increased year-on-year; most of the growth is driven by
European investors. While ETFs have received alot of press in recent times it is
worth noting that the bar and coin market is three times the size of the ETF
market. In China, investment demand slowed from the extreme highs of the first
quarter, but still recorded year-on-year estimated growth approaching double
digits. Outlook for the rest of the year remains good as inflationary pressures
continue to weigh on the Chinese economy. Fears over inflation similarly
underpin the continuation of India`s record gold demand. In the second quarter
of 2010, 154 tons were imported, while in the first two months of this quarter,
192 tons flowed into India. Some 75% of this gold will be destined for the
jewellery market.
Official sector
While the ETF markets failed to register growth, the official sector has been
relatively active. In the first half of the year central banks bought about 151
tons. Mexico added some 100 tons, significantly increasing its holding from
previous levels of 6.9 tons. Russia and Thailand were other notable buyers,
further consolidating the trend of developing economies diversifying their
central bank holdings. Sales under the third Central Bank Agreement for the
current year to date are virtually zero as central banks expand their gold
reserves.
Jewellery sales
As mentioned, India`s storming 2011 continued in the second quarter and the
jewellery market remained buoyant. Unlike in 2010, consumers now appear
accustomed to higher gold prices and many expect it to continue to rise through
the year as fuel, food and fast-moving consumer goods show no sign of ending
their upward price trajectory. Indian consumers were not perturbed by gold price
volatility in the quarter under review as relative Rupee gold price stability
helped ameliorate the situation. Unlike their Indian counterparts, Chinese
consumers did exhibit discomfort with the relatively volatile gold price. The
second quarter is traditionally a slower quarter in China and the three months
through June were no different, although year- on-year jewellery demand still
registered an increase (which may have stretched to double digits). One factor
that may have dampened gold purchases was a new drive by commercial banks to
attract liquidity by increasing the one-month interest rate for deposits to 7%,
while the annual deposit rate is in the region of 3.5%. In the United States,
the strategically vital high-end gold market continued to show signs of strength
with an estimated growth of 15%. High-end gold brands continue to outperform
lower- and mid-end gold plays as the high price of gold continues to gnaw away
at gold content in cheaper jewellery. At JCK, the major trade show held in June,
most attendees were more upbeat than last year as the industry builds off a
stronger, more sustainable base.
Mineral Resource and Ore Reserve
Mineral Resources and Ore Reserves are reported in accordance with the minimum
standards described by the Australasian Code for Reporting of Exploration
Results, Mineral Resources and Ore Reserves (JORC Code, 2004 Edition), and also
conform to the standards set out in the South African Code for the Reporting of
Exploration Results, Mineral Resources and Mineral Reserves (The SAMREC Code,
2007 edition). Mineral Resources are inclusive of the Ore Reserve component
unless otherwise stated.
Introduction
In January 2011, given the continued rally in the gold price, AngloGold Ashanti
committed to publishing its updated Mineral Resource and Ore Reserves using a
price higher than the $850/oz that was used to determine the 2010 Ore Reserve.
MINERAL RESOURCE
The total Mineral Resource increased from 220.0Moz in December 2010 to 232.6Moz
in June 2011. A six month increase of 15.7Moz occurred before the subtraction of
depletion and an increase of 12.6Moz after the subtraction of depletion. It
should be noted that changes in economic assumptions from December 2010 to June
2011 resulted in the Mineral Resource increasing by 14.8Moz whilst exploration
and modelling resulted in an increase of 4.8Moz. The remaining decrease of
3.9Moz resulted from various other factors. Depletions from the Mineral Resource
for the six months totalled 3.1Moz.
MINERAL RESOURCE Moz
Mineral Resource as at 31 December 2010 220.0
Reductions
Siguiri Due to revision of modelling procedures (0.3)
Other Total of non significant changes (1.5)
Additions
Iduapriem Increase in Mineral Resource price 1.2
Geita Combined effect of price and estimation 1.9
La Colosa Due primarily to exploration success 3.8
Obuasi Increase in Mineral Resource price 5.9
Other Total of non significant changes 1.6
Mineral Resource as at 30 June 2011 232.6
Rounding of numbers may results in computational discrepancies
Mineral Resources have been estimated at a gold price of $1,600/oz (2010:
$1,100/oz).
ORE RESERVE
The AngloGold Ashanti Ore Reserve increased from 71.2Moz in December 2010 to
74.0Moz in June 2011. A six month increase of 5.4Moz occurred before the
subtraction of 2.6Moz for depletion, resulting in an increase of 2.9Moz after
the subtraction of depletion. It should be noted that changes in the economic
assumptions from December 2010 to June 2011 resulted in the Ore Reserve
increasing by 2.3Moz while exploration and modelling resulted in a further
increase of 1.1Moz. The remaining increase of 2.0Moz resulted from various other
factors.
Ore Reserve Moz
Ore Reserve as at 31 December 2010 71.2
Reductions
Other Total non-significant changes (0.9)
Additions
Navachab Improved Ore Reserve price 0.5
Obuasi Improved Ore Reserve price 0.6
Cripple Creek and Victor Additional area added to Mine Life Extension Two 0.9
Geita Improved Ore Reserve price 1.0
Other Total non-significant changes 0.7
Ore Reserve as at 30 June 2011 74.0
Rounding of numbers may result in computational discrepancies
Ore reserves have been calculated using a gold price of $1,100/oz (2010:
$850/oz).
By-products
Several by-products are recovered as a result of the processing of gold Ore
Reserves. These include 21,233t of uranium oxide from the South African
operations, 440,270t of sulphur from Brazil and 37.6Moz of silver from
Argentina.
Competent persons
The information in this report relating to exploration results, Mineral
Resources and Ore Reserves is based on information compiled by the Competent
Persons. The Competent Persons consent to the inclusion of Exploration Results,
Mineral Resource and Ore Reserve information in this report, in the form and
context in which it appears.
During the past decade, the company has developed and implemented a rigorous
system of internal and external reviews of Exploration Results, Mineral
Resources or Ore Reserves. A documented chain of responsibility exists from the
Competent Persons at the operations to the company`s Mineral Resource and Ore
Reserve Steering Committee.
Accordingly, the Chairman of the Mineral Resource and Ore Reserve Steering
Committee, VA Chamberlain, MSc (Mining Engineering), BSc (Hons) (Geology),
MGSSA, FAusIMM, assumes responsibility for the Mineral Resource and Ore Reserve
processes for AngloGold Ashanti and is satisfied that the Competent Persons have
fulfilled their responsibilities.
* A detailed breakdown of Mineral Resource and Ore Reserve and backup detail is
provided on the AngloGold Ashanti website (www.anglogoldashanti.com).
MINERAL RESOURCE BY COUNTRY (ATTRIBUTABLE) INCLUSIVE OF ORE RESERVE
Contained Contained
Category Tonnes Grade gold gold
million g/t tonnes Moz
as at 30 June 2011
South Africa Measured 24.54 15.16 371.99 11.96
Indicated 731.24 2.83 2,069.76 66.54
Inferred 40.82 13.81 563.55 18.12
Total 796.60 3.77 3,005.29 96.62
Democratic
Republic of the
Congo Measured - - - -
Indicated 60.85 3.70 224.89 7.23
Inferred 30.02 3.29 98.90 3.18
Total 90.87 3.56 323.79 10.41
Ghana Measured 93.99 4.81 452.50 14.55
Indicated 99.93 3.57 357.24 11.49
Inferred 143.40 3.45 494.20 15.89
Total 337.31 3.87 1,303.94 41.92
Guinea Measured 39.30 0.62 24.45 0.79
Indicated 118.24 0.73 86.11 2.77
Inferred 63.87 0.80 51.40 1.65
Total 221.42 0.73 161.95 5.21
Mali Measured 13.68 1.33 18.15 0.58
Indicated 62.86 1.57 98.67 3.17
Inferred 19.38 1.53 29.67 0.95
Total 95.92 1.53 146.50 4.71
Namibia Measured 18.19 0.77 13.93 0.45
Indicated 102.35 1.22 125.18 4.02
Inferred 16.68 1.15 19.26 0.62
Total 137.22 1.15 158.38 5.09
Tanzania Measured - - - -
Indicated 110.35 2.82 311.36 10.01
Inferred 33.43 2.98 99.65 3.20
Total 143.78 2.86 411.01 13.21
Australia Measured 36.51 1.71 62.41 2.01
Indicated 45.73 2.56 116.91 3.76
Inferred 9.26 4.22 39.05 1.26
Total 91.50 2.39 218.37 7.02
Argentina Measured 11.66 1.68 19.59 0.63
Indicated 21.70 3.84 83.36 2.68
Inferred 11.03 3.12 34.40 1.11
Total 44.39 3.09 137.35 4.42
Brazil Measured 10.81 6.22 67.25 2.16
Indicated 15.66 6.15 96.25 3.09
Inferred 32.57 6.66 216.77 6.97
Total 59.03 6.44 380.27 12.23
Colombia Measured - - - -
Indicated 15.78 0.93 14.75 0.47
Inferred 537.93 0.98 525.02 16.88
Total 553.71 0.97 539.77 17.35
United States Measured 286.41 0.79 227.22 7.31
Indicated 227.22 0.69 157.13 5.05
Inferred 100.67 0.65 64.98 2.09
Total 614.30 0.73 449.33 14.45
Total Measured 535.09 2.35 1,257.49 40.43
Indicated 1,611.92 2.32 3,741.61 120.30
Inferred 1,039.06 2.15 2,236.84 71.92
Total 3,186.07 2.27 7,235.95 232.64
Rounding of figures may result in computational discrepancies.
MINERAL RESOURCE BY COUNTRY (ATTRIBUTABLE) EXCLUSIVE OF ORE RESERVE
Contained Contained
Category Tonnes Grade gold gold
as at 30 June 2011 million g/t tonnes Moz
South Africa Measured 7.45 19.60 145.91 4.69
Indicated 546.22 1.69 925.05 29.74
Inferred 19.64 18.69 367.04 11.80
Total 573.31 2.51 1,437.99 46.23
Democratic
Republic of the
Congo Measured - - - -
Indicated 27.41 3.07 84.20 2.71
Inferred 30.02 3.29 98.90 3.18
Total 57.43 3.19 183.10 5.89
Ghana Measured 28.28 3.89 109.90 3.53
Indicated 69.92 3.89 272.22 8.75
Inferred 109.78 4.02 441.30 14.19
Total 207.99 3.96 823.42 26.47
Guinea Measured 0.83 0.54 0.45 0.01
Indicated 42.39 0.74 31.22 1.00
Inferred 41.25 0.87 35.73 1.15
Total 84.47 0.80 67.39 2.17
Mali Measured 4.69 0.75 3.52 0.11
Indicated 31.17 1.26 39.35 1.27
Inferred 18.60 1.56 29.05 0.93
Total 54.46 1.32 71.92 2.31
Namibia Measured 6.88 0.53 3.65 0.12
Indicated 44.56 1.12 50.11 1.61
Inferred 16.68 1.15 19.26 0.62
Total 68.13 1.07 73.02 2.35
Tanzania Measured - - - -
Indicated 53.48 2.76 147.65 4.75
Inferred 33.43 2.98 99.65 3.20
Total 86.91 2.85 247.31 7.95
Australia Measured 3.33 0.76 2.52 0.08
Indicated 16.54 2.46 40.64 1.31
Inferred 9.26 4.22 39.05 1.26
Total 29.13 2.82 82.21 2.64
Argentina Measured 2.24 2.67 5.98 0.19
Indicated 17.73 2.25 39.88 1.28
Inferred 11.03 3.12 34.40 1.11
Total 30.99 2.59 80.27 2.58
Brazil Measured 3.27 7.01 22.94 0.74
Indicated 7.11 6.18 43.89 1.41
Inferred 28.32 6.83 193.44 6.22
Total 38.70 6.72 260.27 8.37
Colombia Measured - - - -
Indicated 15.78 0.93 14.75 0.47
Inferred 537.93 0.98 525.02 16.88
Total 553.71 0.97 539.77 17.35
United States Measured 116.49 0.74 86.77 2.79
Indicated 136.46 0.67 91.61 2.95
Inferred 100.67 0.65 64.98 2.09
Total 353.62 0.69 243.36 7.82
Total Measured 173.47 2.20 381.63 12.27
Indicated 1,008.76 1.77 1,780.57 57.25
Inferred 956.62 2.04 1,947.81 62.62
Total 2,138.85 1.92 4,110.02 132.14
Rounding of figures may result in computational discrepancies.
ORE RESERVE BY COUNTRY (ATTRIBUTABLE)
Contained Contained
Category Tonnes Grade gold gold
as at 30 June 2011 million g/t tonnes Moz
South Africa Proved 10.18 8.21 83.56 2.69
Probable 188.06 4.44 835.84 26.87
Total 198.24 4.64 919.40 29.56
Democratic Republic
of the Congo Proved - - - -
Probable 33.44 4.21 140.69 4.52
Total 33.44 4.21 140.69 4.52
Ghana Proved 41.77 3.23 134.74 4.33
Probable 53.17 4.47 237.74 7.64
Total 94.94 3.92 372.47 11.98
Guinea Proved 37.84 0.62 23.39 0.75
Probable 74.21 0.69 51.53 1.66
Total 112.05 0.67 74.92 2.41
Mali Proved 4.43 2.21 9.78 0.31
Probable 42.85 1.59 68.25 2.19
Total 47.27 1.65 78.03 2.51
Namibia Proved 11.30 0.78 8.84 0.28
Probable 57.79 1.12 64.57 2.08
Total 69.10 1.06 73.41 2.36
Tanzania Proved - - - -
Probable 56.87 2.86 162.92 5.24
Total 56.87 2.86 162.92 5.24
Australia Proved 33.18 1.80 59.89 1.93
Probable 29.19 2.61 76.27 2.45
Total 62.37 2.18 136.16 4.38
Argentina Proved 10.53 1.39 14.69 0.47
Probable 9.21 4.88 44.94 1.45
Total 19.74 3.02 59.63 1.92
Brazil Proved 7.03 5.43 38.15 1.23
Probable 7.85 5.26 41.27 1.33
Total 14.88 5.34 79.41 2.55
United States Proved 169.92 0.83 140.46 4.52
Probable 90.76 0.72 65.52 2.11
Total 260.68 0.79 205.98 6.62
Total Proved 326.17 1.57 513.49 16.51
Probable 643.41 2.78 1,789.53 57.53
Total 969.58 2.38 2,303.02 74.04
Rounding of figures may result in computational discrepancies.
Group income statement
Quarter Quarter
ended ended
June March
2011 2011
SA Rand million Notes Reviewed Unaudited
Revenue 2 11,547 10,402
Gold income 10,680 9,934
Cost of sales 3 (6,412) (6,469)
(Loss) gain on non-hedge derivatives and other
commodity contracts 4 (14) 11
Gross profit (loss) 4,254 3,476
Corporate administration, marketing and other
expenses (449) (465)
Exploration costs (429) (397)
Other operating expenses 5 (53) (88)
Special items 6 197 11
Operating profit (loss) 3,520 2,537
Interest received 73 55
Exchange (loss) gain (34) 4
Fair value adjustment on option component of
convertible bonds 499 90
Finance costs and unwinding of obligations 7 (342) (341)
Fair value adjustment on mandatory convertible
bonds 442 139
Share of equity accounted investments` profit 139 81
Profit (loss) before taxation 4,297 2,565
Taxation 8 (1,013) (864)
Profit (loss) for the period 3,284 1,701
Allocated as follows:
Equity shareholders 3,195 1,658
Non-controlling interests 89 43
3,284 1,701
Basic earnings (loss) per ordinary share (cents) 1 829 430
Diluted earnings (loss) per ordinary share (cents) 2 826 429
Quarter Six months Six months
ended ended ended
June June June
2010 2011 2010
SA Rand million Unaudited Reviewed Unaudited
Revenue 9,918 21,948 18,371
Gold income 9,625 20,614 17,847
Cost of sales (6,099) (12,882) (12,159)
(Loss) gain on non-hedge derivatives
and other
commodity contracts (3,625) (3) (3,566)
Gross profit (loss) (99) 7,729 2,122
Corporate administration, marketing
and other
expenses (392) (913) (694)
Exploration costs (391) (826) (668)
Other operating expenses (15) (141) (71)
Special items (89) 208 (262)
Operating profit (loss) (986) 6,057 427
Interest received 70 128 134
Exchange (loss) gain (1) (30) 36
Fair value adjustment on option
component of
convertible bonds 129 589 485
Finance costs and unwinding of
obligations (323) (683) (561)
Fair value adjustment on mandatory
convertible
bonds - 581 -
Share of equity accounted investments`
profit 89 220 253
Profit (loss) before taxation (1,022) 6,862 774
Taxation (264) (1,877) (822)
Profit (loss) for the period (1,286) 4,985 (48)
Allocated as follows:
Equity shareholders (1,360) 4,854 (210)
Non-controlling interests 74 131 162
(1,286) 4,985 (48)
Basic earnings (loss) per ordinary
share (cents) 1 (371) 1,259 (57)
Diluted earnings (loss) per ordinary
share (cents) 2 (371) 1,255 (57)
1 Calculated on the basic weighted average number of ordinary shares.
2 Calculated on the diluted weighted average number of ordinary shares.
Rounding of figures may result in computational discrepancies.
The unaudited financial statements for the quarter ended on 30 June 2011 have
been prepared by the corporate accounting staff of AngloGold Ashanti Limited
headed by Mr John Edwin Staples, the Group`s Chief Financial Accounting Officer.
This process was supervised by Mr Srinivasan Venkatakrishnan, the Group`s Chief
Financial Officer. These financial statements were reviewed (but not audited) by
Ernst & Young, the Group`s statutory auditors and approved by the Board of
AngloGold Ashanti Limited. Ernst & Young issued an unqualified review opinion
which can be inspected at the registered offices of AngloGold Ashanti Limited.
Group income statement
Quarter Quarter
ended ended
June March
2011 2011
US Dollar million Notes Reviewed Unaudited
Revenue 2 1,704 1,489
Gold income 1,576 1,422
Cost of sales 3 (947) (926)
(Loss) gain on non-hedge derivatives and other
commodity contracts 4 (2) 2
Gross profit (loss) 627 498
Corporate administration, marketing and other
expenses (66) (66)
Exploration costs (63) (57)
Other operating expenses 5 (8) (13)
Special items 6 29 1
Operating profit (loss) 519 363
Interest received 11 8
Exchange (loss) gain (6) -
Fair value adjustment on option component of
convertible bonds 73 15
Finance costs and unwinding of obligations 7 (50) (49)
Fair value adjustment on mandatory convertible
bonds 64 22
Share of equity accounted investments` profit 21 12
Profit (loss) before taxation 632 371
Taxation 8 (149) (123)
Profit (loss) for the period 483 248
Allocated as follows:
Equity shareholders 470 241
Non-controlling interests 13 7
483 248
Basic earnings (loss) per ordinary share (cents)1 122 62
Diluted earnings (loss) per ordinary share (cents)2 122 62
Quarter Six months Six months
ended ended ended
June June June
2010 2011 2010
US Dollar million Unaudited Reviewed Unaudited
Revenue 1,314 3,194 2,440
Gold income 1,275 2,998 2,370
Cost of sales (810) (1,873) (1,617)
(Loss) gain on non-hedge derivatives
and other
commodity contracts (486) - (473)
Gross profit (loss) (21) 1,125 280
Corporate administration, marketing
and other expenses (51) (132) (91)
Exploration costs (52) (120) (89)
Other operating expenses (2) (21) (10)
Special items (12) 30 (35)
Operating profit (loss) (138) 882 55
Interest received 9 19 18
Exchange (loss) gain - (5) 5
Fair value adjustment on option
component of
convertible bonds 17 88 64
Finance costs and unwinding of
obligations (43) (99) (75)
Fair value adjustment on mandatory
convertible bonds - 87 -
Share of equity accounted investments`
profit 11 32 33
Profit (loss) before taxation (144) 1,004 100
Taxation (33) (273) (109)
Profit (loss) for the period (177) 731 (9)
Allocated as follows:
Equity shareholders (187) 711 (30)
Non-controlling interests 10 20 21
(177) 731 (9)
Basic earnings (loss) per ordinary
share (cents)1 (51) 184 (8)
Diluted earnings (loss) per ordinary
share (cents)2 (51) 184 (8)
1 Calculated on the basic weighted average number of ordinary shares.
2 Calculated on the diluted weighted average number of ordinary shares.
Rounding of figures may result in computational discrepancies.
Group statement of comprehensive income
Quarter Quarter Quarter
ended ended ended
June March June
2011 2011 2010
SA Rand million Reviewed Unaudited Unaudited
Profit (loss) for the period 3,284 1,701 (1,286)
Exchange differences on translation of
foreign operations 23 474 373
Share of equity accounted investments` other
comprehensive expense (3) (2) (4)
Net gain on cash flow hedges - - 1
Net loss on cash flow hedges removed from
equity and reported in gold income - - -
Realised gain on hedges of capital items 1 1 1
Deferred taxation thereon (1) - -
- 1 2
Net (loss) gain on available-for-sale
financial assets (189) (11) 144
Release on disposal and impairment of
available-for-sale financial assets 16 - (41)
Deferred taxation thereon - - 12
(173) (11) 115
Other comprehensive (expense) income
for the period net of tax (153) 462 486
Total comprehensive income (expense)
for the period net of tax 3,131 2,163 (800)
Allocated as follows:
Equity shareholders 3,042 2,120 (874)
Non-controlling interests 89 43 74
3,131 2,163 (800)
Six months Six months
ended ended
June June
2011 2010
SA Rand million Reviewed Unaudited
Profit (loss) for the period 4,985 (48)
Exchange differences on translation of foreign operations 497 93
Share of equity accounted investments` other
comprehensive expense (5) (4)
Net gain on cash flow hedges - -
Net loss on cash flow hedges removed from
equity and reported in gold income - 279
Realised gain on hedges of capital items 2 2
Deferred taxation thereon (1) (98)
1 183
Net (loss) gain on available-for-sale financial assets (200) 99
Release on disposal and impairment of
available-for-sale financial assets 16 (41)
Deferred taxation thereon - 13
(184) 71
Other comprehensive (expense) income
for the period net of tax 309 343
Total comprehensive income (expense)
for the period net of tax 5,294 295
Allocated as follows:
Equity shareholders 5,163 133
Non-controlling interests 131 162
5,294 295
Rounding of figures may result in computational discrepancies.
Group statement of comprehensive income
Quarter Quarter Quarter
ended ended ended
June March June
2011 2011 2010
US Dollar million Reviewed Unaudited Unaudited
Profit (loss) for the period 483 248 (177)
Exchange differences on translation of
foreign operations 25 (48) (84)
Share of equity accounted investments` other
comprehensive expense (1) - (1)
Net gain on cash flow hedges - - -
Net loss on cash flow hedges removed from
equity and reported in gold income - - -
Realised gain on hedges of capital items - - -
Deferred taxation thereon - - -
- - -
Net (loss) gain on available-for-sale
financial assets (27) (2) 20
Release on disposal and impairment of
available-for-sale financial assets 2 - (6)
Deferred taxation thereon - - 2
(25) (2) 16
Other comprehensive expense
for the period net of tax (1) (50) (69)
Total comprehensive income (expense)
for the period net of tax 482 198 (246)
Allocated as follows:
Equity shareholders 469 191 (256)
Non-controlling interests 13 7 10
482 198 (246)
Six months Six months
ended ended
June June
2011 2010
US Dollar million Reviewed Unaudited
Profit (loss) for the period 731 (9)
Exchange differences on translation of foreign
operations (23) (62)
Share of equity accounted investments` other
comprehensive expense (1) (1)
Net gain on cash flow hedges - -
Net loss on cash flow hedges removed from
equity and reported in gold income - 37
Realised gain on hedges of capital items - -
Deferred taxation thereon - (13)
- 24
Net (loss) gain on available-for-sale financial assets (29) 14
Release on disposal and impairment of
available-for-sale financial assets 2 (6)
Deferred taxation thereon - 2
(27) 10
Other comprehensive expense
for the period net of tax (51) (29)
Total comprehensive income (expense)
for the period net of tax 680 (38)
Allocated as follows:
Equity shareholders 660 (59)
Non-controlling interests 20 21
680 (38)
Rounding of figures may result in computational discrepancies.
Group statement of financial position
As at As at
June March
2011 2011
SA Rand million Note Reviewed Unaudited
ASSETS
Non-current assets
Tangible assets 42,256 41,488
Intangible assets 1,357 1,325
Investments in associates and equity accounted
joint ventures 4,451 4,337
Other investments 1,521 1,677
Inventories 2,820 2,453
Trade and other receivables 1,060 1,099
Derivatives - -
Deferred taxation 142 87
Cash restricted for use 172 131
Other non-current assets 68 68
53,847 52,665
Current assets
Inventories 6,295 6,082
Trade and other receivables 1,923 1,878
Derivatives - 17
Current portion of other non-current assets 23 27
Cash restricted for use 207 123
Cash and cash equivalents 5,656 4,187
14,104 12,314
Non-current assets held for sale 12 10
14,116 12,324
TOTAL ASSETS 67,963 64,989
EQUITY AND LIABILITIES
Share capital and premium 11 45,824 45,742
Retained earnings and other reserves (14,500) (17,641)
Non-controlling interests 923 874
Total equity 32,247 28,975
Non-current liabilities
Borrowings 16,514 16,991
Environmental rehabilitation and other
provisions 4,294 4,025
Provision for pension and post-retirement
benefits 1,274 1,268
Trade, other payables and deferred income 131 112
Derivatives 596 1,093
Deferred taxation 7,073 6,428
29,882 29,917
Current liabilities
Current portion of borrowings 204 312
Trade, other payables and deferred income 4,732 4,645
Derivatives - -
Taxation 898 1,140
5,834 6,097
Non-current liabilities held for sale - -
5,834 6,097
Total liabilities 35,716 36,014
TOTAL EQUITY AND LIABILITIES 67,963 64,989
As at As at
December June
2010 2010
SA Rand million Audited Unaudited
ASSETS
Non-current assets
Tangible assets 40,600 43,625
Intangible assets 1,277 1,272
Investments in associates and equity accounted joint
ventures 4,087 4,559
Other investments 1,555 1,512
Inventories 2,268 2,422
Trade and other receivables 1,000 1,022
Derivatives - 19
Deferred taxation 131 28
Cash restricted for use 214 345
Other non-current assets 59 102
51,191 54,906
Current assets
Inventories 5,848 6,061
Trade and other receivables 1,625 1,595
Derivatives 6 1,148
Current portion of other non-current assets 4 2
Cash restricted for use 69 106
Cash and cash equivalents 3,776 6,607
11,328 15,519
Non-current assets held for sale 110 653
11,438 16,172
TOTAL ASSETS 62,629 71,078
EQUITY AND LIABILITIES
Share capital and premium 45,678 40,057
Retained earnings and other reserves (19,470) (18,414)
Non-controlling interests 815 939
Total equity 27,023 22,582
Non-current liabilities
Borrowings 16,877 12,556
Environmental rehabilitation and other provisions 3,873 3,459
Provision for pension and post-retirement benefits 1,258 1,189
Trade, other payables and deferred income 110 150
Derivatives 1,158 852
Deferred taxation 5,910 5,200
29,186 23,406
Current liabilities
Current portion of borrowings 886 185
Trade, other payables and deferred income 4,630 4,065
Derivatives - 19,646
Taxation 882 1,134
6,398 25,030
Non-current liabilities held for sale 22 60
6,420 25,090
Total liabilities 35,606 48,496
TOTAL EQUITY AND LIABILITIES 62,629 71,078
Rounding of figures may result in computational discrepancies.
Group statement of financial position
As at As at
June March
2011 2011
US Dollar million Note Reviewed Unaudited
ASSETS
Non-current assets
Tangible assets 6,271 6,132
Intangible assets 201 196
Investments in associates and equity accounted
joint ventures 661 641
Other investments 226 248
Inventories 419 363
Trade and other receivables 157 162
Derivatives - -
Deferred taxation 21 13
Cash restricted for use 25 19
Other non-current assets 10 10
7,991 7,784
Current assets
Inventories 934 899
Trade and other receivables 286 277
Derivatives - 3
Current portion of other non-current assets 3 4
Cash restricted for use 31 18
Cash and cash equivalents 839 619
2,093 1,820
Non-current assets held for sale 2 2
2,095 1,822
TOTAL ASSETS 10,086 9,606
EQUITY AND LIABILITIES
Share capital and premium 11 6,648 6,637
Retained earnings and other reserves (2,000) (2,483)
Non-controlling interests 137 129
Total equity 4,785 4,283
Non-current liabilities
Borrowings 2,451 2,511
Environmental rehabilitation and other
provisions 637 595
Provision for pension and post-retirement
benefits 189 187
Trade, other payables and deferred income 20 16
Derivatives 88 162
Deferred taxation 1,050 950
4,435 4,421
Current liabilities
Current portion of borrowings 30 46
Trade, other payables and deferred income 703 687
Derivatives - -
Taxation 133 169
866 902
Non-current liabilities held for sale - -
866 902
Total liabilities 5,301 5,323
TOTAL EQUITY AND LIABILITIES 10,086 9,606
As at As at
December June
2010 2010
US Dollar million Audited Unaudited
ASSETS
Non-current assets
Tangible assets 6,180 5,718
Intangible assets 194 167
Investments in associates and equity accounted joint
ventures 622 598
Other investments 237 198
Inventories 345 317
Trade and other receivables 152 134
Derivatives - 2
Deferred taxation 20 4
Cash restricted for use 33 45
Other non-current assets 9 13
7,792 7,196
Current assets
Inventories 890 794
Trade and other receivables 247 209
Derivatives 1 150
Current portion of other non-current assets 1 -
Cash restricted for use 10 14
Cash and cash equivalents 575 866
1,724 2,033
Non-current assets held for sale 16 86
1,740 2,119
TOTAL ASSETS 9,532 9,315
EQUITY AND LIABILITIES
Share capital and premium 6,627 5,834
Retained earnings and other reserves (2,638) (2,998)
Non-controlling interests 124 123
Total equity 4,113 2,959
Non-current liabilities
Borrowings 2,569 1,646
Environmental rehabilitation and other provisions 589 453
Provision for pension and post-retirement benefits 191 156
Trade, other payables and deferred income 17 20
Derivatives 176 112
Deferred taxation 900 681
4,442 3,068
Current liabilities
Current portion of borrowings 135 24
Trade, other payables and deferred income 705 533
Derivatives - 2,575
Taxation 134 148
974 3,280
Non-current liabilities held for sale 3 8
977 3,288
Total liabilities 5,419 6,356
TOTAL EQUITY AND LIABILITIES 9,532 9,315
Rounding of figures may result in computational discrepancies.
Group statement of cash flows
Quarter Quarter Quarter
ended ended ended
June March June
2011 2011 2010
SA Rand million Reviewed Unaudited Unaudited
Cash flows from operating activities
Receipts from customers 11,127 10,123 10,030
Payments to suppliers and employees (6,286) (6,596) (6,992)
Cash generated from operations 4,841 3,527 3,038
Dividends received from equity accounted
investments 94 203 488
Taxation received 492 157 -
Taxation paid (1,129) (280) (563)
Net cash inflow from operating activities 4,298 3,607 2,963
Cash flows from investing activities
Capital expenditure (2,186) (1,635) (1,600)
Proceeds from disposal of tangible assets 45 12 4
Other investments acquired (209) (215) (127)
Acquisition of associates and equity
accounted joint ventures (171) (166) (99)
Proceeds on disposal of associate - - -
Loans advanced to associates and equity
accounted joint ventures (16) - (6)
Proceeds from disposal of subsidiary - 62 -
Cash in subsidiary disposed - (77) -
Proceeds from disposal of investments 186 105 127
(Increase) decrease in cash restricted
for use (123) 31 36
Interest received 68 54 56
Loans advanced - - (1)
Repayment of loans advanced 4 - -
Net cash outflow from investing activities (2,402) (1,829) (1,610)
Cash flows from financing activities
Proceeds from issue of share capital 2 5 26
Share issue expenses (2) - -
Proceeds from borrowings 39 - 7,383
Repayment of borrowings (21) (1,080) (7,263)
Finance costs paid (386) (122) (301)
Dividends paid (72) (306) (182)
Net cash outflow from financing activities (440) (1,503) (337)
Net increase (decrease) in cash and cash
equivalents 1,456 275 1,016
Translation 13 63 245
Cash and cash equivalents at beginning of
period 4,187 3,849 5,346
Cash and cash equivalents at end of period 5,656 4,187 6,607
Cash generated from operations
Profit (loss) before taxation 4,297 2,565 (1,022)
Adjusted for:
Movement on non-hedge derivatives and
other commodity contracts 14 (11) 2,878
Amortisation of tangible assets 1,274 1,294 1,173
Finance costs and unwinding of obligations 342 341 323
Environmental, rehabilitation and other
expenditure 237 1 (18)
Special items 93 45 86
Amortisation of intangible assets 4 4 4
Deferred stripping 40 141 324
Fair value adjustment on option component
of convertible bonds (499) (90) (129)
Fair value adjustment on mandatory
convertible bonds (442) (139) -
Interest received (73) (55) (70)
Share of equity accounted investments`
profit (139) (81) (89)
Other non-cash movements 94 43 9
Movements in working capital (401) (531) (431)
4,841 3,527 3,038
Movements in working capital
Increase in inventories (587) (354) (775)
Increase in trade and other receivables (91) (497) (199)
Increase (decrease) in trade and other
payables 277 320 543
(401) (531) (431)
Six months Six months
ended ended
June June
2011 2010
SA Rand million Reviewed Unaudited
Cash flows from operating activities
Receipts from customers 21,250 18,196
Payments to suppliers and employees (12,882) (13,632)
Cash generated from operations 8,368 4,564
Dividends received from equity accounted investments 297 605
Taxation received 649 -
Taxation paid (1,409) (880)
Net cash inflow from operating activities 7,905 4,289
Cash flows from investing activities
Capital expenditure (3,821) (2,867)
Proceeds from disposal of tangible assets 57 20
Other investments acquired (424) (248)
Acquisition of associates and equity accounted joint
ventures (337) (171)
Proceeds on disposal of associate - 4
Loans advanced to associates and equity accounted
joint ventures (16) (23)
Proceeds from disposal of subsidiary 62 -
Cash in subsidiary disposed (77) -
Proceeds from disposal of investments 291 181
(Increase) decrease in cash restricted for use (92) 33
Interest received 122 116
Loans advanced - (37)
Repayment of loans advanced 4 1
Net cash outflow from investing activities (4,231) (2,991)
Cash flows from financing activities
Proceeds from issue of share capital 7 29
Share issue expenses (2) -
Proceeds from borrowings 4040 7,647,647
Repayment of borrowings (1,101) (9,905)
Finance costs paid (508) (376)
Dividends paid (378) (443)
Net cash outflow from financing activities (1,942) (3,048)
Net increase (decrease) in cash and cash equivalents 1,732 (1,750)
Translation 75 181
Cash and cash equivalents at beginning of period 3,849 8,176
Cash and cash equivalents at end of period 5,656 6,607
Cash generated from operations
Profit (loss) before taxation 6,862 774
Adjusted for:
Movement on non-hedge derivatives and other
commodity contracts 3 2,206
Amortisation of tangible assets 2,568 2,440
Finance costs and unwinding of obligations 683 561
Environmental, rehabilitation and other expenditure 237 13
Special items 139 255
Amortisation of intangible assets 8 7
Deferred stripping 181 528
Fair value adjustment on option component of
convertible bonds (589) (485)
Fair value adjustment on mandatory convertible bonds (581) -
Interest received (128) (134)
Share of equity accounted investments` profit (220) (253)
Other non-cash movements 137 31
Movements in working capital (932) (1,379)
8,368 4,564
Movements in working capital
Increase in inventories (941) (872)
Increase in trade and other receivables (589) (501)
Increase (decrease) in trade and other payables 598 (6)
(932) (1,379)
Rounding of figures may result in computational discrepancies.
Group statement of cash flows
Quarter Quarter Quarter
ended ended ended
June March June
2011 2011 2010
US Dollar million Reviewed Unaudited Unaudited
Cash flow s from operating activities
Receipts from customers 1,641 1,451 1,332
Payments to suppliers and employees (926) (950) (934)
Cash generated from operations 715 501 398
Dividends received from equity accounted
investments 14 30 63
Taxation received 73 22 -
Taxation paid (167) (40) (75)
Net cash inflow from operating activities 635 513 386
Cash flows from investing activities
Capital expenditure (323) (234) (212)
Proceeds from disposal of tangible assets 7 2 1
Other investments acquired (31) (31) (17)
Acquisition of associates and equity
accounted joint ventures (25) (24) (13)
Proceeds on disposal of associate - - -
Loans advanced to associates and equity
accounted joint ventures (2) - (1)
Proceeds from disposal of subsidiary - 9 -
Cash in subsidiary disposed - (11) -
Proceeds from disposal of investments 27 15 17
(Increase) decrease in cash restricted
for use (18) 5 5
Interest received 10 8 7
Loans advanced - - -
Repayment of loans advanced 1 - -
Net cash outflow from investing activities (354) (261) (213)
Cash flow s from financing activities
Proceeds from issue of share capital - 1 3
Share issue expenses - - -
Proceeds from borrowings 6 - 995
Repayment of borrowings (3) (152) (963)
Finance costs paid (57) (18) (40)
Dividends paid (11) (43) (24)
Net cash outflow from financing activities (65) (212) (29)
Net increase (decrease) in cash and cash
equivalents 216 40 144
Translation 4 (7) (11)
Cash and cash equivalents at beginning of
period 619 586 733
Cash and cash equivalents at end of period 839 619 866
Cash generated from operations
Profit (loss) before taxation 632 371 (144)
Adjusted for:
Movement on non-hedge derivatives and
other commodity contracts 2 (2) 387
Amortisation of tangible assets 188 185 156
Finance costs and unwinding of obligations 50 49 43
Environmental, rehabilitation and other
expenditure 35 - (2)
Special items 14 7 11
Amortisation of intangible assets 1 1 -
Deferred stripping 6 20 43
Fair value adjustment on option component
of convertible bonds (73) (15) (17)
Fair value adjustment on mandatory
convertible bonds (64) (22) -
Interest received (11) (8) (9)
Share of equity accounted investments`
profit (21) (12) (11)
Other non-cash movements 14 7 1
Movements in working capital (58) (80) (60)
Movements in working capital 715 501 398
Increase in inventories (92) (17) (55)
Increase in trade and other receivables (15) (66) (17)
Increase (decrease) in trade and other
payables 49 3 12
(58) (80) (60)
Six months Six months
ended ended
June June
2011 2010
US Dollar million Reviewed Unaudited
Cash flow s from operating activities
Receipts from customers 3,092 2,418
Payments to suppliers and employees (1,876) (1,814)
Cash generated from operations 1,216 604
Dividends received from equity accounted investments 44 79
Taxation received 95 -
Taxation paid (207) (117)
Net cash inflow from operating activities 1,148 566
Cash flows from investing activities
Capital expenditure (556) (381)
Proceeds from disposal of tangible assets 8 3
Other investments acquired (62) (33)
Acquisition of associates and equity accounted joint
ventures (49) (23)
Proceeds on disposal of associate - 1
Loans advanced to associates and equity accounted
joint ventures (2) (3)
Proceeds from disposal of subsidiary 9 -
Cash in subsidiary disposed (11) -
Proceeds from disposal of investments 42 24
(Increase) decrease in cash restricted for use (13) 4
Interest received 18 15
Loans advanced - (5)
Repayment of loans advanced 1 -
Net cash outflow from investing activities (615) (398)
Cash flow s from financing activities
Proceeds from issue of share capital 1 4
Share issue expenses - -
Proceeds from borrowings 6 1,029
Repayment of borrowings (155) (1,315)
Finance costs paid (75) (50)
Dividends paid (54) (59)
Net cash outflow from financing activities (277) (391)
Net increase (decrease) in cash and cash equivalents 256 (223)
Translation (3) (11)
Cash and cash equivalents at beginning of period 586 1,100
Cash and cash equivalents at end of period 839 866
Cash generated from operations
Profit (loss) before taxation 1,004 100
Adjusted for:
Movement on non-hedge derivatives and other
commodity contracts - 293
Amortisation of tangible assets 373 324
Finance costs and unwinding of obligations 99 75
Environmental, rehabilitation and other expenditure 35 2
Special items 21 34
Amortisation of intangible assets 1 1
Deferred stripping 26 70
Fair value adjustment on option component of
convertible bonds (88) (64)
Fair value adjustment on mandatory convertible bonds (87) -
Interest received (19) (18)
Share of equity accounted investments` profit (32) (33)
Other non-cash movements 22 4
Movements in working capital (139) (184)
Movements in working capital 1,216 604
Increase in inventories (109) (88)
Increase in trade and other receivables (81) (61)
Increase (decrease) in trade and other payables 51 (35)
(139) (184)
Rounding of figures may result in computational discrepancies.
Group statement of changes in equity
Equity holders of the parent
Share Cash
capital Other flow
and capital Retained hedge
SA Rand million premium reserves earnings reserve
39,834
Balance at 31 December 2009 1,194 (25,739) (174)
(Loss) profit for the period (210)
Other comprehensive (expense) income (4) 183
Total comprehensive (expense)
income - (4) (210) 183
Shares issued 223
Share-based payment for share awards
net of exercised 4
Dividends paid (255)
Dividends of subsidiaries
Transfers to other reserves 26 (26)
Translation 9 (39)
Balance at 30 June 2010 40,057 1,229 (26,243) (17)
Balance at 31 December 2010 45,678 1,275 (25,437) (15)
Profit for the period 4,854
Other comprehensive (expense) income (5) 1
Total comprehensive (expense) income - (5) 4,854 1
Shares issued 148
Share issue expenses (2)
Share-based payment for share awards
net of exercised 127
Dividends paid (306)
Dividends of subsidiaries
Translation 6 (35) 1
Balance at 30 June 2011 45,824 1,403 (20,924) (13)
US Dollar million
Balance at 31 December 2009 5,805 161 (2,744) (23)
(Loss) profit for the period (30)
Other comprehensive (expense) income (1) 24
Total comprehensive (expense) income - (1) (30) 24
Shares issued 29
Share-based payment for share awards
net of exercised
Dividends paid (34)
Dividends of subsidiaries
Transfers to other reserves 3 (3)
Translation (2) 2
Balance at 30 June 2010 5,834 161 (2,806) (2)
Balance at 31 December 2010 6,627 194 (2,750) (2)
Profit for the period 711
Other comprehensive expense (1)
Total comprehensive (expense) income - (1) 711 -
Shares issued 21
Share-based payment for share awards
net of exercised 19
Dividends paid (43)
Dividends of subsidiaries
Translation (4) 5
Balance at 30 June 2011 6,648 208 (2,077) (2)
Equity holders of the parent
Available Foreign
for Actuarial currency
sale (losses) translation
SA Rand million reserve gains reserve
Balance at 31 December 2009 414 (285) 6,314
(Loss) profit for the period
Other comprehensive (expense) income 71 93
Total comprehensive (expense) income 71 - 93
Shares issued
Share-based payment for share awards
net of exercised
Dividends paid
Dividends of subsidiaries
Transfers to other reserves
Translation 10
Balance at 30 June 2010 495 (285) 6,407
Balance at 31 December 2010 568 (409) 4,548
Profit for the period
Other comprehensive (expense) income (184) 497
Total comprehensive (expense) income (184) - 497
Shares issued
Share issue expenses
Share-based payment for share awards
net of exercised
Dividends paid
Dividends of subsidiaries
Translation 15 (1)
Balance at 30 June 2011 399 (410) 5,045
US Dollar million
Balance at 31 December 2009 56 (38) (317)
(Loss) profit for the period
Other comprehensive (expense) income 10 (62)
Total comprehensive (expense) income 10 - (62)
Shares issued
Share-based payment for share awards
net of exercised
Dividends paid
Dividends of subsidiaries
Transfers to other reserves
Translation (1) 1
Balance at 30 June 2010 65 (37) (379)
Balance at 31 December 2010 86 (62) (104)
Profit for the period
Other comprehensive expense (27) (23)
Total comprehensive (expense) income (27) - (23)
Shares issued
Share-based payment for share awards
net of exercised
Dividends paid
Dividends of subsidiaries
Translation 1
Balance at 30 June 2011 59 (61) (127)
Non-
controlling Total
SA Rand million Total interests equity
Balance at 31 December 2009 21,558 966 22,524
(Loss) profit for the period (210) 162 (48)
Other comprehensive (expense) income 343 343
Total comprehensive (expense) income 133 162 295
Shares issued 223 223
Share-based payment for share awards
net of exercised 4 4
Dividends paid (255) (255)
Dividends of subsidiaries - (209) (209)
Transfers to other reserves - -
Translation (20) 20 -
Balance at 30 June 2010 21,643 939 22,582
Balance at 31 December 2010 26,208 815 27,023
Profit for the period 4,854 131 4,985
Other comprehensive (expense) income 309 309
Total comprehensive (expense) income 5,163 131 5,294
Shares issued 148 148
Share issue expenses (2) (2)
Share-based payment for share awards
net of exercised 127 127
Dividends paid (306) (306)
Dividends of subsidiaries - (37) (37)
Translation (14) 14 -
Balance at 30 June 2011 31,324 923 32,247
US Dollar million
Balance at 31 December 2009 2,900 130 3,030
(Loss) profit for the period (30) 21 (9)
Other comprehensive (expense) income (29) (29)
Total comprehensive (expense) income (59) 21 (38)
Shares issued 29 29
Share-based payment for share awards
net of exercised - -
Dividends paid (34) (34)
Dividends of subsidiaries - (28) (28)
Transfers to other reserves - -
Translation - -
Balance at 30 June 2010 2,836 123 2,959
Balance at 31 December 2010 3,989 124 4,113
Profit for the period 711 20 731
Other comprehensive expense (51) (51)
Total comprehensive (expense) income 660 20 680
Shares issued 21 21
Share-based payment for share awards
net of exercised 19 19
Dividends paid (43) (43)
Dividends of subsidiaries - (5) (5)
Translation 2 (2) -
Balance at 30 June 2011 4,648 137 4,785
Rounding of figures may result in computational discrepancies.
Segmental reporting
for the quarter and six months ended 30 June 2011
AngloGold Ashanti`s operating segments are being reported based on the financial
information provided to the Chief Executive Officer and the Executive Management
team, collectively identified as the Chief Operating Decision Maker ("CODM").
Individual members of the Executive Management team are responsible for
geographic regions of the business.
Quarter ended
Jun Mar Jun
2011 2011 2010
Reviewed Unaudited Unaudited
SA Rand million
Gold income
South Africa 4,432 3,910 3,842
Continental Africa 3,918 3,805 3,378
Australasia 629 674 847
Americas 2,335 2,119 2,168
11,313 10,508 10,235
Equity accounted investments
included above (633) (574) (610)
10,680 9,934 9,625
Six months ended
Jun Jun
2011 2010
Reviewed Unaudited
Gold income
South Africa 8,342 6,925
Continental Africa 7,722 6,460
Australasia 1,303 1,691
Americas 4,454 4,047
21,821 19,123
Equity accounted investments
included above (1,207) (1,276)
20,614 17,847
Quarter ended
Jun Mar Jun
2011 2011 2010
Reviewed Unaudited Unaudited
US Dollar million
Gold income
South Africa 654 560 509
Continental Africa 578 545 448
Australasia 93 97 113
Americas 344 303 287
1,669 1,505 1,356
Equity accounted investments included above (93) (82) (81)
1,576 1,422 1,275
Six months ended
Jun Jun
2011 2010
Reviewed Unaudited
Gold income
South Africa 1,214 919
Continental Africa 1,123 858
Australasia 189 225
Americas 647 537
3,173 2,540
Equity accounted investments included above (175) (169)
2,998 2,370
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Reviewed Unaudited Unaudited Reviewed Unaudited
SA Rand million
Gross profit (loss)
South Africa 1,787 1,469 (14) 3,255 783
Continental
Africa 1,658 1,132 (433) 2,790 382
Australasia (71) 37 76 (34) 53
Americas 1,008 1,101 436 2,110 1,345
Corporate and
other 149 (49) 89 100 129
4,531 3,690 154 8,221 2,692
Equity accounted
investments
included above (278) (214) (253) (491) (570)
4,254 3,476 (99) 7,729 2,122
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Reviewed Unaudited Unaudited Reviewed Unaudited
US Dollar million
Gross profit (loss)
South Africa 264 210 (4) 474 104
Continental
Africa 245 163 (61) 407 50
Australasia (10) 5 10 (5) 7
Americas 149 158 56 306 178
Corporate and
other 21 (7) 11 14 17
668 529 13 1,196 356
Equity accounted
investments
included above (41) (31) (34) (71) (76)
627 498 (21) 1,125 280
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Unaudited Unaudited Unaudited Unaudited Unaudited
SA Rand million
Adjusted gross profit
(loss) excluding hedge
buy-back
costs (1)
South Africa 1,787 1,469 1,168 3,255 1,555
Continental
Africa 1,655 1,132 768 2,787 1,549
Australasia (71) 37 1 (34) (24)
Americas 1,025 1,090 950 2,115 1,721
Corporate
and other 149 (49) 88 100 129
4,545 3,678 2,975 8,223 4,930
Equity accounted
investments
included above (278) (214) (253) (491) (570)
4,268 3,464 2,723 7,732 4,360
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Unaudited Unaudited Unaudited Unaudited Unaudited
US Dollar million
Adjusted gross profit
(loss) excluding
hedge buy-back
costs (1)
South Africa 264 210 154 474 205
Continental
Africa 244 163 102 407 206
Australasia (10) 5 - (5) (3)
Americas 151 156 126 307 228
Corporate
and other 21 (7) 11 14 17
670 527 393 1,197 653
Equity accounted
investments
included above (41) (31) (34) (71) (76)
629 497 359 1,126 578
(1) Refer to note B "Non-GAAP disclosure" for definition.
Rounding of figures may result in computational discrepancies.
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Unaudited Unaudited Unaudited Unaudited Unaudited
kg
Gold production (1)
South Africa 13,415 12,466 13,919 25,881 25,867
Continental
Africa 11,740 11,287 11,525 23,027 23,168
Australasia 1,888 2,244 2,692 4,132 6,244
Americas 6,733 6,306 6,876 13,039 13,306
33,776 32,303 35,011 66,079 68,586
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Unaudited Unaudited Unaudited Unaudited Unaudited
oz (000)
Gold production (1)
South Africa 431 401 447 832 832
Continental
Africa 377 363 371 740 745
Australasia 61 72 87 133 201
Americas 216 203 221 419 428
1,086 1,039 1,126 2,124 2,205
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Unaudited Unaudited Unaudited Unaudited Unaudited
SA Rand million
Capital expenditure
South Africa 786 663 746 1,449 1,356
Continental
Africa 710 436 380 1,146 584
Australasia 130 75 81 205 146
Americas 709 551 491 1,260 884
Corporate
and other 7 14 5 22 16
2,342 1,740 1,703 4,082 2,986
Equity accounted
investments
included above (156) (105) (102) (261) (118)
2,186 1,635 1,600 3,821 2,867
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Unaudited Unaudited Unaudited Unaudited Unaudited
US Dollar million
Capital expenditure
South Africa 116 95 99 211 180
Continental
Africa 105 62 50 167 78
Australasia 19 11 11 30 19
Americas 105 79 65 183 117
Corporate
and other 1 2 1 3 2
346 249 226 594 397
Equity accounted
investments
included above (23) (15) (14) (38) (16)
323 234 212 556 381
As at As at As at As at
Jun Mar Dec Jun
2011 2011 2010 2010
Reviewed Unaudited Audited Unaudited
SA Rand million
Total assets
South Africa 15,989 16,275 16,226 17,080
Continental Africa 27,486 26,682 26,060 29,671
Australasia 3,830 4,000 3,644 3,374
Americas 15,172 14,656 13,855 14,939
Corporate and other 6,030 3,917 3,384 6,565
68,507 65,530 63,169 71,629
Equity accounted investments
included above (544) (541) (540) (551)
67,963 64,989 62,629 71,078
As at As at As at As at
Jun Mar Dec Jun
2011 2011 2010 2010
Reviewed Unaudited Audited Unaudited
US Dollar million
Total assets
South Africa 2,373 2,406 2,469 2,238
Continental Africa 4,079 3,944 3,966 3,889
Australasia 568 591 555 442
Americas 2,252 2,166 2,109 1,958
Corporate and other 895 579 515 860
10,167 9,686 9,614 9,387
Equity accounted investments
included above (81) (80) (82) (72)
10,086 9,606 9,532 9,315
(1) Gold production includes equity accounted investments.
Rounding of figures may result in computational discrepancies.
Notes
for the quarter and six months ended 30 June 2011
1. Basis of preparation
The financial statements in this quarterly report have been prepared in
accordance with the historic cost convention except for certain financial
instruments which are stated at fair value. The group`s accounting policies used
in the preparation of these financial statements are consistent with those used
in the annual financial statements for the year ended 31 December 2010.
The financial statements of AngloGold Ashanti Limited have been prepared in
compliance with IAS34 , JSE Listings Requirements and in the manner required by
the South African Companies Act, 2008 for the preparation of financial
information of the group for the quarter and six months ended 30 June 2011.
2. Revenue
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Reviewed Unaudited Unaudited Reviewed Unaudited
SA Rand million
Gold income 10,680 9,934 9,625 20,614 17,847
By-products
(note 3) 458 356 223 814 390
Royalties received 336 57 - 393 -
Interest received 73 55 70 128 134
11,547 10,402 9,918 21,948 18,371
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Reviewed Unaudited Unaudited Reviewed Unaudited
US Dollar million
Gold income 1,576 1,422 1,275 2,998 2,370
By-products (note 3) 67 51 29 118 52
Royalties received 50 8 - 57 -
Interest received 11 8 9 20 18
1,704 1,489 1,314 3,194 2,440
3. Cost of sales
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Reviewed Unaudited Unaudited Reviewed Unaudited
SA Rand million
Cash operating
costs (4,972) (5,107) (4,969) (10,079) (9,743)
Insurance
reimbursement - - 85 - 85
By-products
revenue (note2) 458 356 223 814 390
(4,514) (4,751) (4,661) (9,265) (9,268)
Royalties (321) (276) (246) (597) (435)
Other cash costs (48) (50) (48) (98) (85)
Total cash costs(4,883) (5,077) (4,955) (9,960) (9,787)
Retrenchment costs (20) (28) (26) (47) (78)
Rehabilitation
and other
non-cash costs (349) (68) (36) (417) (122)
Production costs(5,251) (5,173) (5,017) (10,425) (9,987)
Amortisation
of tangible
assets (1,274) (1,294) (1,173) (2,568) (2,440)
Amortisation of
intangible assets (4) (4) (4) (8) (7)
Total production
costs (6,529) (6,471) (6,193) (13,001) (12,435)
Inventory change 117 2 94 119 275
(6,412) (6,469) (6,099) (12,882) (12,159)
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Reviewed Unaudited Unaudited Reviewed Unaudited
US Dollar million
Cash operating
costs (733) (730) (659) (1,464) (1,296)
Insurance
reimbursement - - 11 - 11
By-products
revenue (note2) 67 51 29 118 52
(666) (679) (619) (1,346) (1,233)
Royalties (47) (40) (32) (87) (58)
Other cash costs (7) (7) (7) (14) (11)
Total cash costs (721) (726) (658) (1,447) (1,302)
Retrenchment costs (3) (4) (4) (7) (10)
Rehabilitation
and other
non-cash costs (52) (10) (5) (61) (16)
Production costs (775) (740) (666) (1,515) (1,329)
Amortisation of
tangible assets (188) (185) (156) (373) (324)
Amortisation of
intangible assets (1) (1) - (1) (1)
Total production
costs (964) (925) (822) (1,889) (1,654)
Inventory change 17 (1) 13 16 37
(947) (926) (810) (1,873) (1,617)
4. (Loss) gain on non-hedge derivatives and other commodity contracts
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Reviewed Unaudited Unaudited Reviewed Unaudited
SA Rand million
Loss on realised
non-hedge
derivatives - - (803) - (1,327)
(Loss) gain on
unrealised non-hedge
derivatives (14) 11 (2,822) (3) (2,239)
(14) 11 (3,625) (3) (3,566)
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Reviewed Unaudited Unaudited Reviewed Unaudited
US Dollar million
Loss on realised
non-hedge
derivatives - - (107) - (176)
(Loss) gain on
unrealised non-hedge
derivatives (2) 2 (380) - (297)
(2) 2 (486) - (473)
Rounding of figures may result in computational discrepancies.
5. Other operating expenses
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Reviewed Unaudited Unaudited Reviewed Unaudited
SA Rand million
Pension and medical
defined benefit
provisions (26) (26) (24) (51) (48)
Claims filed by
former employees
in respect of
loss of employment,
work-related accident
injuries and diseases,
governmental fiscal
claims and care and
maintenance of
old tailings
operations (27) (62) 9 (90) (23)
(53) (88) (15) (141) (71)
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Reviewed Unaudited Unaudited Reviewed Unaudited
US Dollar million
Pension and medical
defined benefit
provisions (4) (4) (3) (8) (7)
Claims filed
by former employees
in respect of
loss of employment,
work-related
accident injuries and
diseases, governmental
fiscal claims and care
and maintenance of
old tailings
operations (4) (9) 1 (13) (3)
(8) (13) (2) (21) (10)
6. Special items
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Reviewed Unaudited Unaudited Reviewed Unaudited
SA Rand million
Indirect tax
expenses and
legal claims (32) (35) (35) (67) (79)
Net impairments
of tangible assets
(note 9) (66) (7) (62) (72) (143)
Black Economic
Empowerment
transaction
modification
costs for
Izingwe (Pty) Ltd (44) - - (44) -
Impairment of other
receivables (3) (7) (19) (10) (52)
Contractor
termination
costs at Geita
Gold Mining
Limited - - (4) - (8)
Insurance
claim recovery - - 10 - 10
Royalties
received (1) 336 57 - 393 -
Net profit
(loss) on disposal
and derecognition
of land, mineral
rights, tangible
assets and
exploration
properties
(note 9) 18 (11) (24) 7 (35)
Impairment of
investment
(note 9) (12) - - (12) -
Profit on
disposal of
investments
(note 9) - - 45 - 45
Profit on
disposal of
subsidiary
ISS International
Limited (note 9) - 14 - 14 -
197 11 (89) 208 (262)
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Reviewed Unaudited Unaudited Reviewed Unaudited
US Dollar million
Indirect tax
expenses and
legal claims (5) (5) (5) (10) (11)
Net impairments of
tangible assets
(note 9) (10) (1) (8) (11) (19)
Black Economic
Empowerment
transaction
modification costs
for Izingwe (Pty)
Ltd (7) - - (7) -
Impairment of
other
receivables - (1) (2) (1) (7)
Contractor
termination
costs at Geita
Gold Mining
Limited - - - - (1)
Insurance
claim recovery - - 1 - 1
Royalties
received (1) 50 8 - 58 -
Net profit (loss)
on disposal and
derecognition
of land, mineral
rights, tangible
assets and
exploration
properties (note 9) 3 (2) (3) 1 (5)
Impairment of
investment (note 9) (2) - - (2) -
Profit on disposal
of investments
(note 9) - - 6 - 6
Profit on disposal
of subsidiary
ISS International
Limited (note 9) - 2 - 2 -
29 1 (12) 30 (35)
(1) The June 2011 quarter includes the sale of the Ayanfuri royalty to Franco
Nevada Corporation for a pre-taxation amount of R237m, $35m.
7. Finance costs and unwinding of obligations
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Reviewed Unaudited Unaudited Reviewed Unaudited
SA Rand million
Finance costs (250) (248) (245) (498) (386)
Unwinding of
obligations,
accretion of
convertible
bonds and other
discounts (92) (93) (78) (185) (175)
(342) (341) (323) (683) (561)
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Reviewed Unaudited Unaudited Reviewed Unaudited
US Dollar million
Finance costs (37) (36) (33) (72) (52)
Unwinding of
obligations,
accretion of
convertible
bonds and other
discounts (14) (13) (10) (27) (23)
(50) (49) (43) (99) (75)
8. Taxation
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Reviewed Unaudited Unaudited Reviewed Unaudited
SA Rand million
South African
taxation
Mining tax - - (84) - (84)
Non-mining tax (27) (10) (35) (37) (130)
Under
provision
prior year (49) (5) (12) (54) (23)
Deferred
taxation
Temporary
differences (470) (403) (122) (873) (14)
Unrealised
non-hedge
derivatives
and other
commodity
contracts - - 420 - 260
Change in estimated
deferred tax rate - - (22) - 7
(546) (418) 146 (964) 16
Foreign
taxation
Normal taxation (351) (367) (315) (718) (652)
Over (under)
provision
prior year 2 - (60) 2 (58)
Deferred
taxation
Temporary
differences (118) (79) (13) (198) (105)
Unrealised
non-hedge
derivatives
and other
commodity
contracts - - (23) - (23)
(467) (446) (410) (913) (838)
(1,013) (864) (264) (1,877) (822)
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Reviewed Unaudited Unaudited Reviewed Unaudited
US Dollar million
South African
taxation
Mining tax - - (11) - (11)
Non-mining tax (4) (1) (5) (5) (17)
Under provision
prior year (7) (1) (2) (8) (3)
Deferred taxation
Temporary
differences (69) (58) (15) (127) (1)
Unrealised
non-hedge
derivatives
and other
commodity
contracts - - 56 - 34
Change in
estimated
deferred tax rate - - (3) - 1
(80) (60) 21 (140) 3
Foreign taxation
Normal taxation (52) (52) (42) (104) (87)
Over (under)
provision
prior year - - (8) - (8)
Deferred taxation
Temporary
differences (17) (11) (1) (29) (14)
Unrealised
non-hedge
derivatives
and other
commodity contracts - - (3) - (3)
(69) (63) (54) (133) (112)
(149) (123) (33) (273) (109)
Rounding of figures may result in computational discrepancies.
9. Headline earnings (loss)
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Reviewed Unaudited Unaudited Reviewed Unaudited
SA Rand million
The profit (loss)
attributable to
equity shareholders
has been adjusted by
the following to
arrive atheadline
earnings (loss):
Profit (loss)
attributable
to equity
shareholders 3,195 1,658 (1,360) 4,854 (210)
Net impairments
of tangible assets
(note 6) 66 7 62 72 143
Net (profit)
loss on disposal
and derecognition
of land, mineral
rights, tangible
assets and
exploration
properties
(note 6) (18) 11 24 (7) 35
Impairment of
investment
(note 6) 12 - - 12 -
Profit on
disposal of
subsidiary
ISS International
Limited (note 6) - (14) - (14) -
Profit on disposal
of investments
(note 6) - - (45) - (45)
Impairment of
investment in
associates
and joint ventures 15 - 15 15 35
Taxation on
items above -
current portion 6 - 3 7 3
Taxation on
items above -
deferred portion (32) (6) (14) (38) (35)
3,244 1,656 (1,315) 4,900 (74)
Headline earnings
(loss) per ordinary
share (cents) (1) 841 429 (359) 1,271 (20)
Diluted headline
earnings (loss) per
ordinary share
(cents) (2) 839 428 (359) 1,267 (20)
Quarter ended Six months ended
Jun Mar Jun Jun Jun
2011 2011 2010 2011 2010
Reviewed Unaudited Unaudited Reviewed Unaudited
US Dollar million
The profit (loss)
attributable toe quity
shareholders has
been adjusted by
the following to
arrive at headline
earnings (loss):
Profit (loss)
attributable to
equity
shareholders 470 241 (187) 711 (30)
Net impairments
of tangible assets
(note 6) 10 1 8 11 19
Net (profit)
loss on disposal
and derecognition
of land, mineral
rights, tangible
assets and exploration
properties (note 6) (3) 2 3 (1) 5
Impairment of
investment
(note 6) 2 - - 2 -
Profit on
disposal of
subsidiary
ISS International
Limited (note 6) - (2) - (2) -
Profit on
disposal of
investments
(note 6) - - (6) - (6)
Impairment of
investment in
associates
and joint
ventures 2 - 2 2 5
Taxation on
items above -
current portion 1 - - 1 -
Taxation on
items above -
deferred portion (5) (1) (2) (6) (5)
477 241 (181) 718 (12)
Headline earnings
(loss per ordinary
share (cents) (1) 124 62 (49) 186 (3)
Diluted headline
earnings (loss)
per ordinary share
(cents) (2) 123 62 (49) 186 (3)
(1) Calculated on the basic weighted average number of ordinary shares.
(2) Calculated on the diluted weighted average number of ordinary shares.
10. Number of shares
Quarter ended
Jun Mar Jun
2011 2011 2010
Reviewed Unaudited Unaudited
Authorised number of shares:
Ordinary shares of 25 SA cents
each 600,000,000 600,000,000 600,000,000
E ordinary shares of 25 SA cents
each 4,280,000 4,280,000 4,280,000
A redeemable preference shares of
50 SA cents each 2,000,000 2,000,000 2,000,000
B redeemable preference shares of
1 SA cent each 5,000,000 5,000,000 5,000,000
Issued and fully paid number of
shares:
Ordinary shares in issue 381,573,111 381,403,955 362,752,860
E ordinary shares in issue 3,444,060 2,774,290 3,005,932
Total ordinary shares: 385,017,171 384,178,245 365,758,792
A redeemable preference shares 2,000,000 2,000,000 2,000,000
B redeemable preference shares 778,896 778,896 778,896
In calculating the basic and
diluted number of ordinary shares
outstanding for the period, the
following were taken into
consideration:
Ordinary shares 381,480,773 381,272,542 362,530,946
E ordinary shares 2,665,595 2,782,784 3,235,727
Fully vested options 1,435,811 1,587,017 1,017,064
Weighted average number of shares 385,582,179 385,642,343 366,783,737
Dilutive potential of share options 1,109,716 834,453 -
Diluted number of ordinary
shares (1) 386,691,895 386,476,796 366,783,737
Six months ended
Jun Jun
2011 2010
Reviewed Unaudited
Authorised number of shares:
Ordinary shares of 25 SA cents each 600,000,000 600,000,000
E ordinary shares of 25 SA cents each 4,280,000 4,280,000
A redeemable preference shares of 50 SA cents each 2,000,000 2,000,000
B redeemable preference shares of 1 SA cent each 5,000,000 5,000,000
Issued and fully paid number of shares:
Ordinary shares in issue 381,573,111 362,752,860
E ordinary shares in issue 3,444,060 3,005,932
Total ordinary shares: 385,017,171 365,758,792
A redeemable preference shares 2,000,000 2,000,000
B redeemable preference shares 778,896 778,896
In calculating the basic and diluted number of
ordinary shares
outstanding for the period, the following were
taken into consideration:
Ordinary shares 381,377,232 362,413,862
E ordinary shares 2,723,866 3,483,676
Fully vested options 1,517,717 1,063,772
Weighted average number of shares 385,618,815 366,961,310
Dilutive potential of share options 1,125,147 -
Diluted number of ordinary shares (1) 386,743,962 366,961,310
(1) The basic and diluted number of ordinary shares is the same for the quarter
and six months ended June 2010 as the effects of shares for performance related
options are anti-dilutive.
11. Share capital and premium
As at
Jun Mar Dec Jun
2011 2011 2010 2010
Reviewed Unaudited Audited Unaudited
SA Rand million
Balance at beginning of period 46,343 46,343 40,662 40,662
Ordinary shares issued 156 61 5,771 210
E ordinary shares cancelled (13) (3) (90) (64)
Sub-total 46,486 46,401 46,343 40,808
Redeemable preference shares
held within the group (313) (313) (313) (313)
Ordinary shares held within
the group (149) (136) (139) (199)
E ordinary shares held within
the group (200) (210) (213) (239)
Balance at end of period 45,824 45,742 45,678 40,057
As at
Jun Mar Dec Jun
2011 2011 2010 2010
Reviewed Unaudited Audited Unaudited
US Dollar million
Balance at beginning of period 6,734 6,734 5,935 5,935
Ordinary shares issued 22 9 812 28
E ordinary shares cancelled (2) (1) (13) (9)
Sub-total 6,754 6,742 6,734 5,954
Redeemable preference shares
held within the group (53) (53) (53) (53)
Ordinary shares held within
the group (23) (21) (22) (31)
E ordinary shares held within
the group (30) (31) (32) (36)
Balance at end of period 6,648 6,637 6,627 5,834
Rounding of figures may result in computational discrepancies.
12. Exchange rates
Jun Mar Dec Jun
2011 2011 2010 2010
Unaudited Unaudited Unaudited Unaudited
ZAR/USD average for the
year to date 6.89 6.99 7.30 7.52
ZAR/USD average for the
quarter 6.78 6.99 6.88 7.54
ZAR/USD closing 6.74 6.77 6.57 7.63
ZAR/AUD average for the
year to date 7.11 7.03 6.71 6.71
ZAR/AUD average for the
quarter 7.20 7.03 6.80 6.65
ZAR/AUD closing 7.23 6.99 6.70 6.38
BRL/USD average for the
year to date 1.63 1.67 1.76 1.80
BRL/USD average for the
quarter 1.60 1.67 1.70 1.79
BRL/USD closing 1.56 1.63 1.67 1.80
ARS/USD average for the
year to date 4.04 4.01 3.91 3.87
ARS/USD average for the
quarter 4.08 4.01 3.96 3.90
ARS/USD closing 4.11 4.05 3.97 3.93
13. Capital commitments
Jun Mar Dec Jun
2011 2011 2010 2010
Reviewed Unaudited Audited Unaudited
SA Rand million
Orders placed and outstanding
on capital contracts at the
prevailing rate of exchange (1) 2,719 1,852 1,156 1,809
Jun Mar Dec Jun
2011 2011 2010 2010
Reviewed Unaudited Audited Unaudited
US Dollar million
Orders placed and outstanding
on capital contracts at the
prevailing rate of exchange (1) 403 274 176 237
(1) Includes capital commitments relating to equity accounted joint ventures.
Liquidity and capital resources
To service the above capital commitments and other operational requirements, the
group is dependent on existing cash resources, cash generated from operations
and borrowing facilities.
Cash generated from operations is subject to operational, market and other
risks. Distributions from operations may be subject to foreign investment,
exchange control laws and regulations and the quantity of foreign exchange
available in offshore countries. In addition, distributions from joint ventures
are subject to the relevant board approval.
The credit facilities and other finance arrangements contain financial covenants
and other similar undertakings. To the extent that external borrowings are
required, the group`s covenant performance indicates that existing financing
facilities will be available to meet the above commitments. To the extent that
any of the financing facilities mature in the near future, the group believes
that sufficient measures are in place to ensure that these facilities can be
refinanced.
14. Contingencies
AngloGold Ashanti`s material contingent liabilities and assets at 30 June 2011
are detailed below:
Contingencies and guarantees SA Rand million US Dollar million
Contingent liabilities
Groundwater pollution (1) - -
Deep groundwater pollution - South Africa (2) - -
Sales tax on gold deliveries - Brazil (3) 687 102
Other tax disputes - Brazil (4) 282 42
Indirect taxes - Ghana (5) 82 12
ODMWA litigation (6) - -
Contingent assets
Royalty - Boddington Gold Mine (7) - -
Royalty - Tau Lekoa Gold Mine (8) - -
Financial Guarantees
Oro Group (Pty) Limited (9) 100 15
1,151 171
AngloGold Ashanti is subject to contingencies pursuant to environmental laws and
regulations that may in future require the group to take corrective action as
follows:
(1) Groundwater pollution - AngloGold Ashanti has identified groundwater
contamination plumes at certain of its operations, which have occurred primarily
as a result of seepage from mine residue stockpiles. Numerous scientific,
technical and legal studies have been undertaken to assist in determining the
magnitude of the contamination and to find sustainable remediation solutions.
The group has instituted processes to reduce future potential seepage and it has
been demonstrated that Monitored Natural Attenuation (MNA) by the existing
environment will contribute to improvement in some instances. Furthermore,
literature reviews, field trials and base line modelling techniques suggest, but
are not yet proven, that the use of phyto-technologies can address the soil and
groundwater contamination. Subject to the completion of trials and the
technology being a proven remediation technique, no reliable estimate can be
made for the obligation.
(2) Deep groundwater pollution - The company has identified a flooding and
future pollution risk posed by deep groundwater in the Klerksdorp and Far West
Rand gold fields. Various studies have been undertaken by AngloGold Ashanti
since 1999. Due to the interconnected nature of mining operations, any proposed
solution needs to be a combined one supported by all the mines located in these
gold fields. As a result the Department of Mineral Resources and affected mining
companies are now involved in the development of a "Regional Mine Closure
Strategy". In view of the limitation of current information for the accurate
estimation of a liability, no reliable estimate can be made for the obligation.
(3) Sales tax on gold deliveries - Mineracao Serra Grande S.A. (MSG), received
two tax assessments from the State of Goias related to payments of sales taxes
on gold deliveries for export. AngloGold Ashanti C rrego do Sit o Mineracao S.A.
manages the operation and its attributable share of the first assessment is
approximately $63m, R425m. The company`s attributable share of the second
assessment is approximately $39m, R262m. In November 2006 the administrative
council`s second chamber ruled in favour of MSG and fully cancelled the tax
liability related to the first period. In July 2011, the administrative
council`s second chamber ruled in favour of MSG and fully cancelled the tax
liability related to the second period. The State of Goias has appealed to the
full board of the State of Goias tax administrative council. The company
believes both assessments are in violation of federal legislation on sales
taxes.
(4) Other tax disputes - MSG received a tax assessment in October 2003 from the
State of Minas Gerais related to sales taxes on gold. The tax administrators
rejected the company`s appeal against the assessment. The company is now
appealing the dismissal of the case. The company`s attributable share of the
assessment is approximately $11m, R72m.
AngloGold Ashanti subsidiaries in Brazil are involved in various disputes with
tax authorities. These disputes involve federal tax assessments including income
tax, royalties, social contributions and annual property tax. The amount
involved is approximately $31m, R210m.
(5) Indirect taxes - AngloGold Ashanti (Ghana) Limited received a tax assessment
for $12m, R82m during September 2009 in respect of 2006, 2007 and 2008 tax
years, following an audit by the tax authorities related to indirect taxes on
various items. Management is of the opinion that the indirect taxes are not
payable and the company has lodged an objection.
(6) Occupational Diseases in Mines and Works Act (ODMWA) litigation - The case
of Mr Thembekile Mankayi was heard in the High Court of South Africa in June
2008, and an appeal heard in the Supreme Court of Appeals in 2010. In both
instances judgement was awarded in favour of AngloGold Ashanti Limited. A
further appeal that was lodged by Mr Mankayi was heard in the Constitutional
Court in 2010. Judgement in the Constitutional Court was handed down on 3 March
2011.
Following the judgement, Mr Mankayi`s executor may proceed with his case in the
High Court. This will comprise, amongst others, providing evidence showing that
Mr Mankayi contracted silicosis as a result of negligent conduct on the part of
AngloGold Ashanti.
The company will defend the case and any subsequent claims on their merits.
Should other individuals or groups lodge similar claims, these too would be
defended by the company and adjudicated by the Courts on their merits. In view
of the limitation of current information for the accurate estimation of a
possible liability, no reliable estimate can be made for this possible
obligation.
(7) Royalty - As a result of the sale of the interest in the Boddington Gold
Mine joint venture during 2009, the group is entitled to receive a royalty on
any gold recovered or produced by the Boddington Gold Mine, where the gold price
is in excess of Boddington Gold Mine`s cash cost plus $600/oz. The royalty
commenced on 1 July 2010 and is capped at a total amount of $100m, R674m.
Royalties of $7m, R45m were received during the quarter. Total royalties of
$17m, R124m have been received to date.
(8) Royalty - As a result of the sale of the interest in the Tau Lekoa Gold Mine
during 2010, the group is entitled to receive a royalty on the production of a
total of 1.5Moz ounces by the Tau Lekoa Gold Mine and in the event that the
average monthly rand price of gold exceeds R180,000/kg (subject to inflation
adjustment). Where the average monthly rand price of gold does not exceed
R180,000/kg (subject to inflation adjustment), the ounces produced in that
quarter do not count towards the total 1.5Moz upon which the royalty is payable.
The royalty will be determined at 3% of the net revenue (being gross revenue
less State royalties) generated by the Tau Lekoa assets. Royalties of $1m, R7m
were received during the quarter.
(9) Provision of surety - The company has provided sureties in favour of a
lender on a gold loan facility with its affiliate Oro Group (Pty) Limited and
one of its subsidiaries to a maximum value of $15m, R100m. The suretyship
agreements have a termination notice period of 90 days.
15. Concentration of risk
There is a concentration of risk in respect of recoverable value added tax and
fuel duties from the Tanzanian government:
- Recoverable value added tax due from the Tanzanian government amounts to $46m,
R310m at 30 June 2011 (31 March 2011: $47m, R317m). The last audited value added
tax return was for the period ended 31 October 2010 and at the reporting date
the audited amount was $47m, R317m. The outstanding amounts at Geita have been
discounted to their present value at a rate of 7.82%.
- Recoverable fuel duties from the Tanzanian government amounts to $71m, R478m
at 30 June 2011 (31 March 2011: $67m, R451m). Fuel duty claims are required to
be submitted after consumption of the related fuel and are subject to
authorisation by the Customs and Excise authorities. Claims for the refund of
fuel duties amounting to $53m, R357m have been lodged with the Customs and
Excise authorities which are still outstanding, whilst claims for a refund of
$18m, R121m have not yet been submitted. The amounts outstanding have been
discounted to their present value at a rate of 7.82%.
16. Borrowings
AngloGold Ashanti`s borrowings are interest bearing.
17. Announcements
Restructuring of the Black Economic Empowerment Share Ownership transaction: On
14 April 2011 AngloGold Ashanti announced the proposed restructure of the Black
Economic Empowerment transaction (BEE transaction). Shareholders in general
meeting approved the restructure on 11 May 2011, by the requisite majority.
Sale of mining area to Blyvooruitzicht Gold Mining Company: On 14 July 2011,
AngloGold Ashanti confirmed that it had offered to sell to Blyvooruitzicht Gold
Mining Company, a South African incorporated company, some 390,000 square metres
of its neighbouring Savuka mining area, for a consideration of R35 million. The
area offered for sale was not within the company`s current mine plan. The sale
is subject to the finalisation of a binding agreement and the securing of the
necessary regulatory approvals.
Acquisition of an interest in First Uranium: On 22 July 2011, AngloGold Ashanti
announced that it had entered into an agreement to acquire 47,065,916 shares (or
approximately 19.79%) in First Uranium Corporation (First Uranium), a Canadian
incorporated company, from Village Main Reef Limited (Village), a South African
incorporated company, at a price of CAD0.60 per share. In addition, Village have
granted to AngloGold Ashanti, lock-up rights and rights of first refusal for its
remaining approximate 5.7% stake in First Uranium and its holding of
approximately R392.8 million convertible bonds issued by First Uranium.
18. Dividend
The directors declared Interim Dividend No. 110 of 90 (Interim Dividend No. 108:
65) South African cents per ordinary share for the six months ended 30 June
2011. In compliance with the requirements of Strate, given the company`s primary
listing on the JSE Limited, the salient dates for payment of the dividend are as
follows:
To holders of ordinary shares and to holders of CHESS Depositary Interests
(CDIs) Each CDI represents one-fifth of an ordinary share.
2011
Currency conversion date for UK pounds, Australian dollars
and Ghanaian cedis Thursday, 25 August
Last date to trade ordinary shares cum dividend Friday, 26 August
Last date to register transfers of certificated securities
cum dividend Friday, 26 August
Ordinary shares trade ex dividend Monday, 29 August
Record date Friday, 2 September
Payment date Friday, 9 September
On the payment date, dividends due to holders of certificated securities on the
South African and United Kingdom share registers will be electronically
transferred to shareholders` bank accounts. Given the increasing incidences of
fraud with respect to cheque payments, the company has ceased the payment of
dividends by way of cheque.
Shareholders are requested to notify the relevant share registrars with banking
details to enable future dividends to be paid via electronic funds transfer.
Refer to the back cover for share registrar details.
Dividends in respect of dematerialised shareholdings will be credited to
shareholders` accounts with the relevant CSDP or broker.
To comply with further requirements of Strate, between Monday, 29 August 2011
and Friday, 2 September 2011, both days inclusive, no transfers between the
South African, United Kingdom, Australian and Ghana share registers will be
permitted and no ordinary shares pertaining to the South African share register
may be dematerialised or rematerialised.
To holders of American Depositary Shares
Each American Depositary Share (ADS) represents one
ordinary share.
2011
Ex dividend on New York Stock Exchange Wednesday, 31 August
Record date Friday, 2 September
Approximate date for currency conversion Friday, 9 September
Approximate payment date of dividend Monday, 19 September
Assuming an exchange rate of R6.7437/$, the dividend payable per ADS is
equivalent to 13.3458 US cents. This compares with the interim dividend of
9.0034 US cents per ADS paid on 20 September 2010. However the actual rate of
payment will depend on the exchange rate on the date for currency conversion.
To holders of Ghanaian Depositary Shares (GhDSs)
100 GhDSs represent one ordinary share.
2011
Last date to trade and to register GhDSs cum dividend Friday, 26 August
GhDSs trade ex dividend Monday, 29 August
Record date Friday, 2 September
Approximate payment date of dividend Monday, 12 September
Assuming an exchange rate of R1/Cents (USD)0.2243, the dividend payable per
share is equivalent to 0.2018 cedis. This compares with the interim dividend of
0.1266 cedis per share paid on 13 September 2010. However, the actual rate of
payment will depend on the exchange rate on the date for currency conversion. In
Ghana, the authorities have determined that dividends payable to residents on
the Ghana share register be subject to a final withholding tax at a rate of 8%.
In addition, directors declared Dividend No. E10 of 45 South African cents per E
ordinary share, payable to employees participating in the Bokamoso ESOP and
Izingwe Holdings (Proprietary) Limited. These dividends will be paid on Friday,
9 September 2011.
19. Detailed report
This report contains a summary of the results of AngloGold Ashanti`s operations.
A detailed report appears on the internet and is obtainable in printed format
from the investor relations contacts, whose details, along with the website
address, appear at the end of this report.
By order of the Board
T T MBOWENI M CUTIFANI
Chairman Chief Executive Officer
2 August 2011
Shareholders` notice board
IMPORTANT NOTICE TO SHAREHOLDERS
DISTRIBUTION OF QUARTERLY AND ANNUAL REPORTS
On 1 May 2011, the South African Companies Act, 71 of 2008 came into effect. In
line with this Act, companies are no longer obliged to print and post certain
material - such as quarterly and annual reports - to shareholders, unless
shareholders specifically request to receive documents in a printed format.
AngloGold Ashanti recognises that the majority of its shareholders would prefer
that:
- Timely information be available on the company`s website or by e-mail;
- The company be prudent in the publication and postage of material in line with
its cost reduction initiatives; and
- Scarce natural and man-made resources are used responsibly. By reducing the
printing and postage of reports, we will use less paper, ink, energy and water,
and we will reduce our carbon emissions.
By way of this notice, AngloGold Ashanti advises that shareholders wishing to
receive information from the company in the future should indicate their
preference. AngloGold Ashanti will continue to provide information in printed
format to any shareholder that elects to receive the same.
- I would like to receive printed information by post.
- I would like to receive information by email at the following email address:
...................................................(No email will exceed 1Mb.)
- I will access the information on the company`s website. Please send an e-mail
alert to me, notifying me when new information is available on the website, at
the above e-mail address
Please fax, post or e-mail your response to:
Fax number: +27 11 637 6677
E-mail address: companysecretary@anglogoldashanti.com
Postal address: Company Secretary, P O Box 62117,
Marshalltown, 2107, South Africa
Alternatively, you may fill this information in online at:
http://www.rair.co.za/clients/aga/aga-site/shareholder-notice.htm.
The registration form will be available on the website from 22 August 2011.
Should you not make an election, you will no longer receive any reports from
AngloGold Ashanti.
Dematerialised shareholders, who do not wish to receive copies of reports,
should advise their CSD Participant or Stockbroker to amend their records
accordingly.
PAYMENT OF DIVIDENDS BY WAY OF CHEQUE
Given the increasing incidences of fraud with respect to cheque payments, the
company will ceased the payment of dividends by way of cheque. If you have not
already lodged a bank mandate form, you are requested to notify the relevant
share registrars with banking details to enable future dividends to be paid via
electronic funds transfer. Refer to the back cover for share registrar details.
If you have not already completed a bank mandate form and lodged this with the
share registrar of if you do not do so, you will receive no further dividends
from the company until such time as a completed bank mandated form is so lodged.
CHANGE OF DETAILS
Shareholders are reminded that the onus is on them to keep the company, through
its nominated share registrars, or through the relevant CSDPs or Brokers,
apprised of any change in their postal address and personal particulars.
Similarly, where shareholders receive dividend payments electronically (EFT),
they should ensure that the banking details which the share registrars and/or
CSDPs have on file are correct.
Administrative information
ANGLOGOLD ASHANTI LIMITED
Registration No. 1944/017354/06
Incorporated in the Republic of South Africa
Share codes:
ISIN: ZAE000043485
JSE: ANG
LSE: AGD
NYSE: AU
ASX: AGG
GhSE (Shares): AGA
GhSE (GhDS): AAD
Euronext Paris: VA
Euronext Brussels: ANG
JSE Sponsor: UBS
Auditors: Ernst & Young Inc.
Offices
Registered and Corporate
76 Jeppe Street
Newtown 2001
(PO Box 62117, Marshalltown 2107)
South Africa
Telephone: +27 11 637 6000
Fax: +27 11 637 6624
Australia
Level 13, St Martins Tower
44 St George`s Terrace
Perth, WA 6000
(PO Box Z5046, Perth WA 6831)
Australia
Telephone: +61 8 9425 4602
Fax: +61 8 9425 4662
Ghana
Gold House
Patrice Lumumba Road
(PO Box 2665)
Accra
Ghana
Telephone: +233 303 772190
Fax: +233 303 778155
United Kingdom Secretaries
St James`s Corporate Services Limited
6 St James`s Place
London SW1A 1NP
England
Telephone: +44 20 7499 3916
Fax: +44 20 7491 1989
E-mail: jane.kirton@corpserv.co.uk
Directors
Executive
M Cutifani
(Chief Executive Officer)
S Venkatakrishnan * (Chief Financial Officer)
Non-Executive
T T Mboweni (Chairman)
F B Arisman #
R Gasant
W A Nairn
Prof L W Nkuhlu
F Ohene-Kena +
S M Pityana
* British # American
Australian South African
+ Ghanaian
Officers
Company Secretary: Ms L Eatwell
Investor Relations Contacts
South Africa
Michael Bedford
Telephone: +27 11 637 6273
Mobile: +27 82 374 8820
E-mail: mbedford@AngloGoldAshanti.com
United States
Stewart Bailey
Telephone: +1-212-836-4303
Mobile: +1-646-717-3978
E-mail: sbailey@AngloGoldAshanti.com
General E-mail enquiries
investors@AngloGoldAshanti.com
AngloGold Ashanti website
http://www.AngloGoldAshanti.com
Company secretarial E-mail
Companysecretary@AngloGoldAshanti.com
AngloGold Ashanti posts information that is important to investors on the main
page of its website at www.anglogoldashanti.com and under the "Investors" tab on
the main page. This information is updated regularly. Investors should
visit this website to obtain important information about AngloGold Ashanti.
Share Registrars
South Africa
Computershare Investor Services (Pty)
Limited
Ground Floor, 70 Marshall Street
Johannesburg 2001
(PO Box 61051, Marshalltown 2107)
South Africa
Telephone: 0861 100 950 (in SA)
Fax: +27 11 688 5218
web.queries@computershare.co.za
United Kingdom
Computershare Investor Services PLC
The Pavilions
Bridgwater Road
Bristol BS99 7NH
England
Telephone: +44 870 702 0000
Fax: +44 870 703 6119
Australia
Computershare Investor Services Pty
Limited
Level 2, 45 St George`s Terrace
Perth, WA 6000
(GPO Box D182 Perth, WA 6840)
Australia
Telephone: +61 8 9323 2000
Telephone: 1300 55 2949 (in Australia)
Fax: +61 8 9323 2033
Ghana
NTHC Limited
Martco House
Off Kwame Nkrumah Avenue
PO Box K1A 9563 Airport
Accra
Ghana
Telephone: +233 303 229664
Fax: +233 303 229975
ADR Depositary
The Bank of New York Mellon ("BoNY")
BNY Shareowner Services
PO Box 358016
Pittsburgh, PA 15252-8016
United States of America
Telephone: +1 800 522 6645 (Toll free in
USA) or +1 201 680 6578 (outside USA)
E-mail: shrrelations@mellon.com
Website:
www.bnymellon.com.com\shareowner
Global BuyDIRECTSM
BoNY maintains a direct share purchase
and dividend reinvestment plan for
ANGLOGOLD ASHANTI.
Telephone: +1-888-BNY-ADRS
PUBLISHED BY ANGLOGOLD ASHANTI
PRINTED BY INCE (PTY) LIMITED
Certain statements made in this communication, including, without limitation,
those concerning the economic outlook for the gol d mining industry,
expectations regarding gold prices, production, cash costs and other operating
results, growth prospects and outlook of AngloGold Ashanti`s operations,
individually or in the aggregate, including the completion and commencement of
commercial operations of certain of AngloGold Ashanti`s exploration and
production projects and the completion of announced mergers and acquisitions
transactions, AngloGold Ashanti`s liquidity, capital resources and capital
expenditure and the outcome and consequences of any litigation or regulatory
proceedings or environmental issues, contain certain forward-looking statements
regarding AngloGold Ashanti`s operations, economic performance and financial
condition. Although AngloGold Ashanti believes that the expectations reflected
in such forward-looking statements are reasonable, no assurance can be given
that such expectations will prove to have been correct. Accordingly, results
could differ materially from those set out in the forward-looking statements as
a result of, among other factors, changes in economic and market conditions,
success of business and operating initiatives, chang es in the regulatory
environment and other government actions including environmental approvals and
actions, fluctuations in gold prices and exchange rates, and business and
operational risk management. For a discussion of certain of these and other
factors, refer to AngloGold Ashanti`s annual report for the year ended 31
December 2010, which was distributed to shareholders on 29 March 2011 and the
company`s 2010 annual report on Form 20- F, which was filed with the Securities
and Exchange Commission in the United States on May 31, 2011. These factors are
not necessarily all of the important factors that could cause AngloGold
Ashanti`s actual results to differ materially from those expressed in any
forward-looking statements. Other unknown or unpredictable factors could also
have material adverse effects on future results. AngloGold Ashanti undertakes no
obligation to update publicly or release any revisions to these forward-looking
statements to reflect events or circumstances after today`s date or to reflect
the occurrence of unanticipated events. All subsequent written or oral forward-
looking statements attributable to AngloGold Ashanti or any person acting on its
behalf are qualified by the cautionary statements herein.
This communication contains certain "Non-GAAP" financial measures. AngloGold
Ashanti utilises certain Non-GAAP performance measures and ratios in managing
its business. Non-GAAP financial measures should be viewed in addition to, and
not as an alternative for, the reported operating results or cash flow from
opera tions or any other measures of performance prepared in accordance with
IFRS. In addition, the presentation of these measures may not be comparable to
similarly titled measures other companies may use.
AngloGold Ashanti posts information that is important to investors on the main
page of its website at www.anglogoldashanti.com and under the "Investors" tab on
the main page. This information is updated regularly. Investors should visit
this website to obtain important information about AngloGold Ashanti.
Date: 04/08/2011 07:55:00 Produced by the JSE SENS Department.
The SENS service is an information dissemination service administered by the
JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or
implicitly, represent, warrant or in any way guarantee the truth, accuracy or
completeness of the information published on SENS. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
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