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Avgold Limited -
Avgold Limited
(Incorporated in the Republic of South Africa)
Registration Number: 1990/007025/06
Share code AVG
ISIN ZAE000012175
("Avgold" or "the Company")
Reviewed Results FOR THE QUARTER AND YEAR ENDED 30 JUNE 2003
Avgold share price (cents)
Quarter ended Year ended
30 June ended 30 June
2003 2003
High: 815 1280
Low: 730 610
Average: 786 847
Period end: 765 765
Source: Reuters
SAFETY AND HEALTH
An employee tragically lost his life in an accident at ETC"s Fairview mine in
March 2003. The Board extended their sincere condolences to the bereaved family
and friends. The Board of Directors is pleased to announce that during the year
Target achieved its third Department of Minerals and Energy (DME) 1 000
Fatality Free Production Shifts Award. The injury frequency rate was 7,97 lost
day cases per million man-hours worked in the June 2003 quarter and 11,52 lost
day cases per million man- hours worked for the year ended June 2003. The lost
day injury frequency rate per million man-hours worked for Avgold is as follows:
Quarter ended Year ended
30 June 31 March 31 Dec 30 Sept 30 June 30 June
2003 2003 2002 2002 2003 2002
ETC 8,16 6,06 20,02 15,84 12,26 8,90
TARGET 7,80 5,67 8,83 21,31 10,95 10,90
Avgold 7,97 5,85 13,61 19,15 11,52 10,10
ANNUAL HIGHLIGHTS
* TOTAL GOLD SOLD UP 185 PER CENT TO 382 500 OUNCES
* CASH COSTS REDUCED BY 12 PER CENT TO R56 503 PER KILOGRAM
* OPERATING CASHFLOW INCREASED BY 274 PER CENT TO R215 MILLION
* ETC DIVISION SOLD FOR R255 MILLION
* SYNDICATED LOANS REPAID IN FULL; GEARING REDUCED TO 5,6 PER CENT
* HEDGE BOOK RESTRUCTURED
SALIENT FEATURES - SALES AND COSTS
Quarter ended Year ended
June March June June
2003 2003 2003 2002
Avgold total:
Revenue received - Rand per
kilogram 83 390 85 036 83 891 86 794
- US$ per ounce 309 310 305 306
Average spot price - Rand per
kilogram 86 740 95 874 97 266 93 541
- US$ per ounce 346 354 334 288
Cash cost - Rand per
kilogram 56 508 53 386 56 503 64 277
- US$ per ounce 225 197 193 198
Total gold sales - kilograms 2 623 3 267 11 899 4 179
- ounces 84 335 105 021 382 561 134 348
Target:
Cash cost - Rand per
kilogram 50 060 47 723 51 327 52 992
- US$ per ounce 199 176 175 156
Total gold sales - kilograms 2 048 2 583 9 155 1 374
- ounces 65 855 83 045 294 339 44 167
ETC:
Cash cost - Rand per
kilogram 79 488 74 786 73 774 69 805
- US$ per ounce 317 276 252 215
Total gold sales - kilograms 575 683 2 744 2 805
- ounces 18 479 21 975 88 221 90 181
OVERVIEW
The commissioning of the Target mine in May 2002 has fundamentally changed the
profile of Avgold. The 2003 annual results are therefore not comparable to the
2002 results. The June 2003 quarter results reflect the ETC division"s
contribution to Avgold until 15 June 2003, the effective date of the sale of the
ETC division to a Metorex Limited ("Metorex") subsidiary.The rand gold hedge
book was converted to dollar gold commodity hedges during June 2003 (refer to
hedging note on page 3).
AVGOLD: Quarter ended 30 June 2003
Avgold"s revenue decreased to R219,1 million (31 March 2003: R278,0 million)
during the quarter due to the deterioration of mining conditions in the massive
stopes at Target, requiring the re-design and re-scheduling of these stopes,
with a resultant short-term negative impact on gold production. ETC"s revenue
for the quarter decreased by R10,7 million due to lower grades. Headline
earnings before unrealised non-hedge derivatives declined to R2,2 million
(R41,2 million). A foreign exchange gain of R0,6 million was recorded in the
June quarter, a decline from the previous quarter"s R14,1 million.
Operating profit declined to R13,1 million (R47,2 million) mainly due to the
decline in gold production at both Target and ETC.
Cash costs increased 6 per cent to R56 508/kg (R53 386/kg) in rand terms. This
equates to a 14 per cent increase in US dollar terms to US$225/oz (US$197/oz),
reflecting the strengthening of the rand. The decrease in ore milled to 320 811
tonnes (328 795 tonnes) and decline in yield to 8,18g/t (9,93g/t) resulted in
total gold sold during the quarter reducing to 2 623kg (3 267kg).
Avgold signed a sale of business agreement with Metorex on 14 February 2003,
whereby a subsidiary of Metorex was to acquire Avgold"s ETC assets for R300
million (including company housing with an estimated value of R12 million).
However, following the strengthening of the rand against the US dollar and the
decline in the gold price, the Metorex board of directors recommended that the
ETC sale agreement be renegotiated.Avgold accepted a revised offer of R255
million (excluding company housing) for its ETC assets on 14 April 2003.The ETC
sale was concluded on 15 June 2003 and an exceptional book profit of R7,1
million was realised.
Capital expenditure was R33,8 million (R31,9 million).The exceptional item of
R7,1 million refers to the book profit on the sale of ETC.
AVGOLD: year ended 30 June 2003
Target"s first full set of annual operating results are reflected in this
period. Avgold achieved a much increased revenue of R999,5 million (30 June
2002: R363,8 million). Headline earnings before unrealised non-hedge derivatives
was R122,5 million (R36,4 million), which equates to 18 cents (5 cents) a share.
After accounting for unrealised non-hedge derivatives, headline earnings equates
to R19,8 million.Avgold recorded an operating profit of R109,9 million (R17,3
million).Total gold sold during the period was 11 899kg (4 179kg) at a yield of
8,57g/t (8,56g/t), including 697kg from the old Loraine mine"s cleanup. Cash
costs were R56 503/kg (R64 277/kg) or US$193/oz (US$198/oz).
Target"s life of mine plan was updated during the year.The new life of mine is
18 years, compared to the previous life of 13 years. The revised proven and
probable underground reserves included in the life of mine plan have increased
from 2,52Moz to 3,86Moz.
Capital expenditure declined significantly to R122,9 million (R437,5 million).
TARGET: Quarter ended 30 June 2003
Ore milled declined to 242 549 tonnes (249 417 tonnes) due to the above-
mentioned difficulties with large rocks and dilution in the massive open stopes
during the month of May.The decline in ore milled, coupled with the fall in
yield to 8,44g/t (10,36g/t), saw total gold sold decrease to 2 048kg (2
583kg). Cash costs increased to R50 060/kg (R47 723/kg), or US$199/oz
(US$176/oz). Capital expenditure was R28,4 million (R25,7 million).
TARGET: year ended 30 June 2003
During the year Target milled 1 068 376 tonnes of ore at a yield of 8,57g/t.
Total gold sold amounted to 9 155kg, of which 697kg was from the old Loraine
mine"s cleanup. The cash cost was R51 327/kg, or US$175/oz. Capital expenditure
decreased significantly to R100,5 million (R404,8 million).
ETC: Quarter to 15 June 2003
The figures for this period are not comparable as the ETC division is only
accounted for up to 15 June 2003.The Sheba, New Consort and Fairview mines
milled 78 262 tonnes (79 378 tonnes) of ore at an average yield of 7,34g/t
(8,61g/t). Cash costs increased to R79 488/kg (R74 786/kg) or US$317/oz
(US$276/oz). Gold sold declined to 575kg (683kg). Capital expenditure was R1,9
million (R2,1 million).
ETC: Year to 15 June 2003
Ore milled rose to 320 388 tonnes, compared to the previous year"s 315 523
tonnes.The decline in yield to 8,56g/t from 8,89g/t resulted in the total amount
of gold sold decreasing to 2 744kg (2 805kg). Cash costs increased to R73 774/kg
(R69 805/kg), or US$252/oz (US$215/oz).
Capital expenditure declined to R10,9 million (R17,5 million).
Northern Free State
The surface exploration drilling in the Paradise area (immediately north of
Target mine), was completed during the quarter.This together with additional
underground exploration drilling resulted in 5,66Moz being upgraded from the
Inferred to Indicated Resource category.
Mineral Resources
Target Extension (Including Sun)
2002 2003
Indicated (Moz) 18,83 24,49
Inferred (Moz) 42,62 35,13
Total (Moz) 61,45 59,62
The pre-feasibility study on a mine design, which considers various options, is
continuing. The completed design and report will be presented to the Board by 30
September 2003.
HEDGING
As at 30 June 2003, Avgold"s hedge book represented 72 per cent of forecast gold
production to June 2006 and had a mark-to-market value of a negative R192
million. This was calculated at a gold price of US$346,15/oz and an exchange
rate of US$1,00:ZAR7,510. The hedges are un-margined and Avgold is maintaining
its policy of not using derivative instruments for speculative purposes.
During June the rand gold hedge book was restructured in terms of the company"s
hedging policy into dollar gold commodity hedges. One of the conditions
precedent of the syndicate banks in providing a R700 million loan funding
facility to Avgold in January 2001 for the completion of Target, was that
repayment security was required in the form of rand gold hedges. The conversion
of these rand gold hedges was achieved by the purchase of rand/US$ forward
exchange contracts ("FEC"s").
These FEC"s have been fair valued based upon the year-end exchange rate. In
terms of the rigid structural rules of the generally accepted accounting
statement on financial instruments AC133, this results in a R102 million charge
(Non- hedged derivative) to the income statement during this quarter. This
amount is included in the overall mark-to-market value of the hedge book and
represents the unrealised present value of potential future losses of revenue,
which may arise as a result of the purchase of the FEC contracts. This
accounting does not achieve matching of income and expenditure and does not
represent the commodity-based nature of the Avgold hedge book. Earnings are
significantly distorted as a result and do not present an accurate economic
picture of the company"s results during the reporting period.
Subsequent changes to exchange rates will result in adjustments to the income
statement thereby creating further variability in earnings.
The hedge book at 30 June 2003, after the restructuring is as follows:
June June June
Period ending 2004 2005 2006
Dollar forward
sales contracts
Quantity sold kg 9 162 9 137 4 403
oz 294 579 293 762 141 545
US$/oz 313 316 323
TRANSLATION INTO US DOLLARS
To assist international investors, a translation of convenience into United
States dollars is provided for in the income statements, balance sheets and cash
flow statements. These translations are based on average rates of exchange for
income statement and cash flow statement items and those ruling at period end
for the balance sheet items.
The following rand/US dollar exchange rates were used to prepare the financial
results:
Year Year
Quarter ended ended ended
June June March June June
2003 2002 2003 2003 2002
Average rate for the period 7,81 10,60 8,42 9,12 10,09
Spot rate at end of period 7,51 10,25 8,00 7,51 10,25
SHAREHOLDING
Shareholders should note that an announcement was made on 16 July 2003
indicating that Anglo American Plc has sold its entire Avgold shareholding,
which equated to an 11,5% stake, to Harmony Gold Mines Company Limited, subject
to the completion of certain formalities.
CHANGE OF DIRECTORS
Messrs D N Murray, D N Campbell and G J Robbertze have resigned from the Board
with effect from 1 July 2003 and Messrs W A Nairn and V P Uren resigned with
effect from 21 July 2003.
Avgold is pleased to announce the appointment of Mr Michael Arnold as financial
director of the Company with effect from 1 July 2003, succeeding Mr D N
Campbell. The Board is being restructured and the two vacant positions will be
filled in due course by independent non-executive directors.
BORROWINGS
The loans raised from a syndicate of banks to fund the completion of Target were
repaid in full on 30 June 2003.This was achieved by utilising existing cash
resources which included the proceeds from the sale of ETC and sourcing the
balance by draw down from a R200 million unsecured general term banking facility
concluded with Standard Corporate and Merchant Bank. Net borrowings at the year-
end were all rand denominated and have reduced to R134 million from R566 million
in June 2002. The gearing of the Company equates to 5,6 percent.
DIVIDEND POLICY
After meeting our obligations for debt servicing and capital replacement we
intend to distribute surplus cash in the form of dividend, although there can be
no assurance that dividends will be paid in the future or as to the particular
amounts that will be paid from year to year. The payments of future dividends
will depend upon the Board"s ongoing assessment of our earnings, financial
condition, including our cash needs, future earnings prospects and other
factors.
PROSPECTS
Avgold will improve operational efficiencies and consistency of gold production
to enhance cashflow. The current process of defining mineral resources to the
north of Target has been completed. The mine design pre-feasibility studies will
be completed and reported upon by the end of the quarter ending September 2003.
Avgold will continue to manage the hedge book, however earnings will be effected
by future fluctuations in the Rand/US$ exchange rate.
ACCOUNTING POLICIES
The accounting policies used are in accordance with South African Statements of
Generally Accepted Accounting Practice and are consistent with those applied in
the previous financial year.
REVIEWED RESULTS
The financial results for the year ended 30 June 2003 have been reviewed by KPMG
Inc and the review opinion is available for inspection at the Company"s
registered office.
On behalf of the Board of Directors
Chairman
R P Menell
Managing Director
J C Steenkamp
Directors: R P Menell (Chairman), J C Steenkamp+ (Managing), M Arnold+,
J J Geldenhuys, A N Lewis+, G S Potgieter+
+ Executive directors
Company secretary: S E Sather
Johannesburg
23 July 2003
INCOME STATEMENT - Rand thousand
Unaudited Reviewed Audited
Quarter ended Year ended Year ended
June June March June June
2003 2002 2003 2003 2002
Revenue 219 097 170 762 278 020 999 480 363 802
- gold revenue 218 738 169 669 277 770 998 217 362 709
- by-products 359 1 093 250 1 263 1 093
Costs and
expenses 205 990 175 833 230 785 889 560 346 468
- gold operating 148 574 122 712 174 636 673 344 265 137
- retrenchments - 4 747 - - 4 747
- amortisation 46 577 39 064 48 291 186 900 57 389
- administration
and general 10 839 9 310 7 858 29 316 19 195
Operating
profit/(loss) 13 107 (5 071) 47 235 109 920 17 334
Investment
income 3 333 1 982 3 073 12 987 2 147
Finance cost 13 811 8 419 15 008 57 946 8 419
Foreign
exchange gain 559 30 335 14 111 66 745 30 335
Unrealised
non-hedge
derivatives (102 715) - - (102 715) -
Income/(loss)
before
exceptional
item (99 527) 18 827 49 411 28 991 41 397
Exceptional
items 7 085 - - 7 085 -
Income/(loss)
before taxation (92 442) 18 827 49 411 36 076 41 397
Taxation 1 000 5 000 8 207 9 207 5 000
Net
earnings/(loss)
for the period (93 442) 13 827 41 204 26 869 36 397
Headline
earnings/(loss) (100 527) 13 827 41 204 19 784 36 397
Headline
earnings before
unrealised
non-hedge
derivatives 2 188 13 827 41 204 122 499 36 397
Headline
earnings/(loss)
per share
(cents) (15) 2 6 3 5
Headline
earnings per
share before
unrealised
non-hedge
derivatives
(cents) - 2 6 18 5
Earnings/(loss)
per share
(cents) (14) 2 6 4 5
Weighted number
of shares in
issue (million) 676 672 675 674 670
Reconciliation
of earnings and
Headline
earnings
Net earnings
per income
statement (93 442) 13 827 41 204 26 869 36 397
Exceptional
items (7 085) - - (7 085) -
(100 527) 13 827 41 204 19 784 36 397
BALANCE SHEET - Rand thousand
Reviewed Audited
30 June 30 June
2003 2002
ASSETS
Non-current assets 2 569 795 2 931 207
Fixed assets 2 543 841 2 883 336
Investments 25 954 47 871
Current assets 84 382 208 742
Inventories 46 407 44 761
Trade and other receivables 37 214 55 171
Deposits and cash 761 108 810
Total assets 2 654 177 3 139 949
EQUITY AND LIABILITIES
Capital and reserves
Share capital 6 765 6 729
Share premium 2 219 900 2 206 385
Reserves 43 827 16 958
Total shareholders" equity 2 270 492 2 230 072
Non-current liabilities 144 639 630 105
Long-term loans - 548 072
Derivative instruments 102 715 -
Long-term provisions 41 924 82 033
Current liabilities 239 046 279 772
Trade and other payables 104 126 153 343
Short-term borrowings 134 920 126 429
Total equity and liabilities 2 654 177 3 139 949
CASH FLOW STATEMENT - Rand thousand
Unaudited Reviewed Audited
Quarter ended Year ended Year ended
June March June June
2003 2003 2003 2002
Cash generated
from/(utilised by)
operations
Operating profit 13 107 47 235 109 920 17 334
Non-cash items and
adjustments
Amortisation and
depreciation 46 577 48 291 186 900 57 389
Provisions (5 263) 524 (5 546) 7 788
54 421 96 050 291 274 82 511
Retrenchment payments - - - (5 873)
Payments to
environmental trust fun d 3 926 - 3 926 (4 151)
Investment income 3 333 3 073 12 987 2 147
Finance charges (13 811) (15 008) (57 946) (8 419)
47 869 84 115 250 241 66 215
Cash provided
by/(reinvested in)
working capital
Inventories (15 910) 8 300 (18 351) (11 514)
Payables and provisions 3 426 641 (30 390) 10 155
Receivables 11 446 1 088 13 577 (7 303)
Net cash generated from
operating activities 46 831 94 144 215 077 57 553
Cash utilised in
investment activities
Fixed assets acquired (33 846) (32 583) (125 014) (345 645)
Investments acquired (5) (478) (483) (1 124)
Fixed assets sold 199 713 2 689 5 531
Business sold 251 817 - 251 817 -
218 165 (32 348) 129 009 (341 238)
Cash provided by
financing activities
Net increase in
shareholders" funding 3 922 1 719 13 551 22 868
Leased assets (380) (363) (1 434) (1 634)
(Decrease)/increase in
long-term loans (327 920) (48 269) (376 189) 191 952
(Decrease)/increase in
overdrafts and
short-term borrowings (74 096) (5 904) (76 224) 123 402
(398 474) (52 817) (440 296) 336 588
(Decrease)/increase in
cash balances (133 478) 8 979 (96 210) 52 903
Cash and cash
equivalents at beginning
of period 133 813 133 387 108 810 55 907
Translation adjustment 426 (8 553) (11 839)
Cash and cash
equivalents at end of
period 761 133 813 761 108 810
STATEMENT OF SHAREHOLDERS" EQUITY Rand thousand
Reviewed Audited
Ordinary share Year ended Year ended
capital and Retained June June
premium income 2003 2002
Changes in
shareholders" equity
Balance at beginning
of period 2 213 114 16 958 2 230 072 2 170 808
Share options exercised 13 584 - 13 584 22 867
Expenses written off
against share premium (33) - (33) -
Net earnings for the
period - 26 869 26 869 36 397
Balance at end of
period 2 226 665 43 827 2 270 492 2 230 072
INCOME STATEMENT - US dollar thousand
Quarter ended Year ended Year ended
June June March June June
2003 2002 2003 2003 2002
Revenue 28 053 16 115 33 019 109 592 36 060
gold revenue 28 007 16 012 32 989 109 454 35 952
by-products 46 103 30 138 108
Costs and expenses 26 375 16 593 27 409 97 539 34 342
gold operating 19 023 11 580 20 741 73 832 26 280
retrenchments - 448 - - 470
amortisation 5 964 3 686 5 735 20 493 5 689
administration and
general 1 388 879 933 3 214 1 903
Operating
profit/(loss) 1 678 (478) 5 610 12 053 1 718
Investment income 427 187 365 1 424 213
Finance cost 1 768 795 1 783 6 354 835
Foreign exchange gain 72 2 863 1 676 7 319 3 007
Unrealised non-hedge
derivatives (11 263) - - (11 263) -
Income/(loss) before
exceptional item (10 854) 1 777 5 868 3 179 4 103
Exceptional items 777 777
Income/(loss) before
taxation (10 077) 1 777 5 868 3 956 4 103
Taxation 133 472 1 026 1 010 495
Net earnings/(loss)
for the period (10 210) 1 305 4 842 2 946 3 608
Headline/(loss)
earnings (10 987) 1 305 4 842 2 169 3 608
Headline earnings
before unrealised
non-hedge
derivatives 275 1 305 4 842 13 432 3 608
Headline
earnings/(loss) per
share (cents) (2) - - - 1
Headline earnings
per share before
unrealised non-hedge
derivatives (cents) - - - 2 1
Earnings/(loss) per
share (cents) (2) - - - 1
Weighted number of
shares in issue
(million) 676 672 675 674 670
Reconciliation of
earnings and
Headline earnings
Net earnings per
income statement (10 210) 1 305 4 842 2 946 3 608
Exceptional items (777) - - (777) -
(10 987) 1 305 4 842 2 169 3 608
BALANCE SHEET - US dollar thousand
30 June 30 June
2003 2002
ASSETS
Non-current assets 342 183 285 971
Fixed assets 338 727 281 301
Investments 3 456 4 670
Current assets 11 236 20 365
Inventories 6 180 4 367
Trade and other receivables 4 955 5 382
Deposits and cash 101 10 616
Total assets 353 419 306 336
EQUITY AND LIABILITIES
Capital and reserves
Share capital 901 656
Share premium 299 343 217 773
Reserves 2 085 (861)
Total shareholders" equity 302 329 217 568
Non-current liabilities 19 259 61 474
Long-term loans - 53 471
Derivative instruments 13 677 -
Long-term provisions 5 582 8 003
Current liabilities 31 831 27 294
Trade and other payables 13 865 14 960
Short-term borrowings 17 966 12 334
Total equity and liabilities 353 419 306 336
CASH FLOW STATEMENT - US dollar thousand
Quarter ended Year ended Year ended
June March June June
2003 2003 2003 2002
Cash generated
from/(utilised by)
operations
Operating profit 1 678 5 610 12 053 1 718
Non-cash items and
adjustments:
Amortisation and depreciation 5 964 5 735 20 493 5 689
Provisions (674) 63 (608) 772
6 968 11 408 31 938 8 179
Retrenchment payments - - - (582)
Payments to environmental
trust fund 503 - 430 (411)
Investment income 427 365 1 424 213
Finance charges (1 768) (1 783) (6 354) (835)
6 130 9 990 27 438 6 564
Cash provided by/(reinvested
in) working capital
Inventories (2 037) 986 (2 012) (1 141)
Payables and provisions 439 76 (3 332) 1 007
Receivables 1 465 129 1 489 (724)
Net cash generated from
operating activities 5 997 11 181 23 583 5 706
Cash utilised in investment
activities
Fixed assets acquired (4 334) (3 870) (13 708) (34 260)
Investments acquired (1) (57) (53) (112)
Fixed assets sold 26 85 295 548
Business sold 32 243 - 27 612 -
27 934 (3 842) 14 146 (33 824)
Cash provided by financing
activities
Net increase in
shareholders" funding 502 204 1 486 2 267
Leased assets (49) (43) (157) (162)
(Decrease)/increase in
long-term loans (41 987) (5 733) (41 249) 19 026
(Decrease)/increase in
overdrafts and short-term
borrowings (9 487) (701) (8 358) 12 232
(51 021) (6 273) (48 278) 33 363
(Decrease)/increase in cash
balances (17 090) 1 066 (10 549) 5 245
Cash and cash equivalents at
beginning of period 16 727 15 420 10 616 6 919
Translation adjustment 464 241 34 (1 548)
Cash and cash equivalents at
end of period 101 16 727 101 10 616
STATEMENT OF SHAREHOLDERS" EQUITY - US dollar thousand
Retained
Ordinary share income/ Year ended Year ended
capital and (accumulated June June
premium loss) 2003 2002
Changes in
shareholders"
equity
Balance at
beginning of
period 218 429 (861) 217 568 268 664
Share options
exercised 1 489 - 1 489 2 267
Expenses
written off
against share
premium (4) - (4) -
Net earnings
for the
period - 2 946 2 946 3 608
Translation
adjustment 80 330 - 80 330 (56 971)
Balance at
end of period 300 244 2 085 302 329 217 568
OPERATING RESULTS
AVGOLD TOTAL
Quarter ended Year ended Year ended
June June March June June
2003 2002 2003 2003 2002
Metric
Ore milled tonnes 320 811 243 867 328 795 1 388 764 488 023
Gold sold kg 2 623 2 068 3 267 11 899 4 179
Yield g/t 8,18 8,48 9,93 8,57 8,56
Cash cost R/kg 56 508 59 251 53 386 56 503 64 277
Non-cash cost R/kg 21 885 25 266 17 189 18 150 18 375
Total cost R/kg 78 393 84 517 70 575 74 653 82 652
Capital expenditure
R000"s 33 825 42 129 31 870 122 905 437 514
Imperial
Ore milled tons 353 630 268 815 362 431 1 530 835 537 948
Gold sold oz 84 334 66 472 105 021 382 561 134 348
Yield oz/t 0,24 0,25 0,29 0,25 0,25
Cash cost US$/oz 225 174 197 193 198
Non-cash cost US$/oz 87 74 63 62 57
Total cost US$/oz 312 248 260 255 255
Capital
expenditure US$000"s 4 331 3 976 3 785 13 476 43 495
TARGET TOTAL
Metric
Ore milled tonnes 242 549 172 500* 249 417 1 068 376 172 500
Gold sold kg 2 048 1 374* 2 583 9 155 1 374
Yield g/t 8,44 7,96* 10,36 8,57 7,96
Cash cost R/kg 50 060 52 992* 47 723 51 327 52 992
Non-cash cost R/kg 21 188 26 594* 16 342 17 900 26 594
Total cost R/kg 71 248 79 586* 64 065 69 227 79 586
Capital
expenditure R000"s 28 427 35 080 25 657 100 539 404 754
Development
results:
Advanced m 1 713 1 893 1 809 7 431 5 933
Reef development m 1 045 695 1 374 5 308 2 561
Sampled m 243 398 513 1 866 1 377
Channel width cm 479 409 428 1 818 1 757
Channel value g/t 3,32 4,38 9,79 6,76 6,31
cm.g/t 1 590 1 791 4 191 12 298 11 083
Imperial
Ore milled tons 267 362 190 147* 274 932 1 177 671 190 147
Gold sold oz 65 855 44 167* 83 045 294 339 44 167
Yield oz/t 0,25 0,23* 0,30 0,25 0,23
Cash cost US$/oz 199 156* 176 175 156
Non-cash cost US$/oz 85 78* 60 61 78
Total cost US$/oz 284 234* 237 236 234
Capital
expenditure US$000"s 3 640 3 310 3 047 11 024 40 119
*Note: Results for May 2002 and June 2002
ETC TOTAL
Metric
Ore milled tonnes 78 262 71 367 79 378 320 388 315 523
Gold sold kg 575 694 683 2 744 2 805
Yield g/t 7,34 9,72 8,61 8,56 8,89
Cash cost R/kg 79 488 71 646 74 786 73 774 69 805
Non-cash cost R/kg 9 935 19 134 9 784 9 185 11 919
Total cost R/kg 89 423 90 780 84 570 82 959 81 724
Capital expenditureR000"s 1 861 2 824 2 057 10 866 17 482
Development results:
Advanced m 1 793 1 653 1 718 7 246 7 909
Reef development m 492 265 530 1 938 1 872
Sampled m 367 235 440 1 724 2 010
Channel width cm 195 204 162 197 223
Channel value g/t 7,1 5,9 3,1 7,0 3,8
cm.g/t 1 384 1 204 509 1 388 854
Imperial
Ore milled tons 86 268 78 668 87 498 353 164 347 801
Gold sold oz 18 479 22 305 21 975 88 221 90 181
Yield oz/t 0,21 0,28 0,25 0,25 0,26
Cash cost US$/oz 317 210 276 252 215
Non-cash cost US$/oz 40 56 36 31 37
Total cost US$/oz 356 266 312 283 252
Capital expenditureUS$000"s 238 266 244 1 191 1 733
PRODUCTION COST RECONCILIATION
AVGOLD TOTAL - Rand thousand
Quarter ended
Year ended Year ended
June June March June June
2003 2002 2003 2003 2002
Gold operating
costs per income
statement 148 574 122 712 174 636 673 344 265 137
Add: Revenue from
closed operations - 884 - - 4 551
Less: Revenue from
by-products (359) (1 093) (250) (1 263) (1 093)
Cash costs 148 215 122 503 174 386 672 081 268 595
Add:
Retrenchments - 4 747 - - 4 747
Amortisation and
depreciation 46 577 39 064 48 291 186 900 57 389
Administration and
general 10 839 9 310 7 858 29 316 19 195
Less: Revenue
from
closed
operations - (884) - - (4 551)
Non-cash costs 57 416 52 237 56 149 216 216 76 780
Total cost 205 631 174 740 230 535 888 297 345 375
Gold sold kg 2 623 2 068 3 267 11 899 4 179
Production cost:
Cash cost R/kg 56 508 59 251 53 386 56 503 64 277
Non-cash cost R/kg 21 885 25 266 17 189 18 150 18 375
Total operating
cost R/kg 78 393 84 517 70 575 74 653 82 652
Gold price
realised R/kg 83 390 82 054 85 036 83 891 86 794
AVGOLD TOTAL - US dollar thousand
Year ended Year ended
June June March June June
2003 2002 2003 2003 2002
Gold operating costs
per income statement 19 024 11 580 20 741 73 832 26 280
Add: Revenue from
closed operations 83 451
Less: Revenue from
by-products (46) (103) (30) (139) (108)
Cash costs 18 978 11 560 20 711 73 693 26 623
Add:
Retrenchments 448 471
Amortisation and
depreciation 5 964 3 686 5 735 20 493 5 689
Administration and
general 1 388 879 933 3 215 1 903
Less: Revenue
from closed
operations (83) (451)
Non-cash costs 7 352 4 930 6 669 23 708 7 612
Total cost 26 329 16 490 27 379 97 401 34 235
Gold sold oz 84 334 66 472 105 021 382 560 134 348
Production cost:
Cash cost US$/oz 225 174 197 193 198
Non-cash cost US$/oz 87 74 63 62 57
Total operating
cost US$/oz 312 248 260 255 255
Gold price
realised US$/oz 309 305 310 305 306
CONTACT DETAILS:
EBRAHIM TAKOLIA
Direct line: (+27 11) 634-0333
Fax: (+27 11) 634-0278
Mobile: 083 291 3384
e-mail: ebrahimt@avmin.co.za
AVGOLD LIMITED
www.avgold.co.za
Date: 23/07/2003 12:00:33 PM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
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