Wrap Text
NEWS RELEASE
CORPORATE COMMUNICATIONS DEPARTMENT
12TH FLOOR, 11 DIAGONAL STREET
JOHANNESBURG 2001
TELEPHONE: (+27 11) 637-6379
FAX: (+27 11) 637 6399/6400
29 OCTOBER 1999
REPORT FOR THE QUARTER ENDED 30 SEPTEMBER 1999
HIGHLIGHTS
* DESPITE
- 5% DROP IN THE AVERAGE DOLLAR GOLD SPOT PRICE
- 6% DROP IN THE AVERAGE RAND SPOT PRICE
HEADLINE EARNINGS RISE 4% TO R525 MILLION ($86 MILLION)
* SADIOLA - PRODUCTION UP 15%; CASH COSTS DOWN 14% TO $88/OZ
* SOUTH AFRICAN MINES - PRODUCTION UP 2%; LABOUR PRODUCTIVITY UP 3%
* SOUTH AMERICAN MINES - PRODUCTION UP 4%; CASH COSTS DOWN 3%
* NORTH AMERICAN MINES - PRODUCTION UP 45%; CASH COSTS DOWN 3%
* 17.5% RETURN ON SHAREHOLDERS' EQUITY (17% LAST QUARTER)
* 14.8% RETURN ON CAPITAL EMPLOYED (14.5% LAST QUARTER)
QUARTER ENDED NINE MONTHS ENDED
SEPT. JUNE SEPT. SEPT.
1999 1999 1999 1998
RAND/METRIC
PREPARED IN ACCORDANCE WITH INTERNATIONAL ACCOUNTING STANDARDS
GOLD
PRODUCED - KG - OZ(000) 55 337 53 438 162 487 155 435
REVENUE - R/KG - $/OZ SOLD 61 754 61 841 61 489 57 951
CASH COSTS - R/KG - $/OZ
PRODUCED 40 823 41 314 40 936 39 798
TOTAL PRODUCTION COSTS - R/KG
- $/OZ PRODUCED 46 714 46 968 46 716 46 060
OPERATING PROFIT - RM - $M 837 800 2 417 1 782
NET CAPITAL EXPENDITURE- RM
- $M 327 306 885 298
ATTRIBUTABLE PROFIT - RM- $M 493 1 018 2 122 1 237
ATTRIBUTABLE EARNINGS - CENTS
PER SHARE 504 1 040 2 168 1 264
HEADLINE EARNINGS - CENTS PER
SHARE 537 519 2 029 1 047
HEADLINE EARNINGS BEFORE
DEFERRED TAX ADJUSTMENT -
CENTS PER SHARE 537 519 1 559 1 047
DIVIDENDS - CENTS PER SHARE - - 900 750
QUARTER ENDED NINE MONTHS ENDED
SEPT. JUNE SEPT. SEPT.
1999 1999 1999 1998
PREPARED IN ACCORDANCE WITH INTERNATIONAL ACCOUNTING STANDARDS
DOLLAR/IMPERIAL
GOLD
PRODUCED - KG - OZ(000) 1 779 1 717 5 224 4 998
REVENUE - R/KG - $/OZ SOLD 316 314 313 334
CASH COSTS - R/KG - $/OZ
PRODUCED 209 210 209 229
TOTAL PRODUCTION COSTS - R/KG
- $/OZ PRODUCED 239 239 238 271
OPERATING PROFIT - RM - $M 138 131 396 326
NET CAPITAL EXPENDITURE - RM
- $M 54 50 145 56
ATTRIBUTABLE PROFIT - RM - $M 81 166 348 236
ATTRIBUTABLE EARNINGS - CENTS
PER SHARE 83 170 356 241
HEADLINE EARNINGS - CENTS PER
SHARE 88 85 333 193
HEADLINE EARNINGS BEFORE
DEFERRED TAX ADJUSTMENT -
CENTS PER SHARE 88 85 256 193
DIVIDENDS - CENTS PER SHARE - - 149 127
LETTER FROM THE CHAIRMAN AND THE CHIEF EXECUTIVE OFFICER
THE THIRD QUARTER OF 1999 HAS BEEN ONE OF THE MOST CHALLENGING IN LIVING
MEMORY. THE GOLD PRICE HAS BEEN AT TWO-DECADE LOWS. IN DOLLAR TERMS, THE
AVERAGE SPOT PRICE, AT $259, WAS 5% LOWER THAN THE PREVIOUS QUARTER. THE RAND
STRENGTHENED AGAINST THE DOLLAR OVER THE QUARTER, SO THAT THE SPOT PRICE IN
RAND TERMS WAS 6% LOWER. IN THIS GLOOMY MARKET CIRCUMSTANCE, ANGLOGOLD HAS
PRODUCED IMPROVED HEADLINE EARNINGS OF R525 MILLION, OR $86 MILLION. THIS
REPRESENTS A RETURN ON SHAREHOLDERS' EQUITY OF 17.5% (17% LAST QUARTER) AND
14.8% ON CAPITAL EMPLOYED (14.5% LAST QUARTER).
GOLD PRODUCTION AT 1.8 MILLION OUNCES IMPROVED BY 4%, CASH COSTS REDUCED
MARGINALLY FROM $210 TO $209, AND TOTAL COSTS WERE MAINTAINED AT LAST QUARTER'S
LEVEL OF $239. LABOUR PRODUCTIVITY, AS MEASURED IN GRAMS OF GOLD PRODUCED,
IMPROVED FROM 209 IN THE LAST QUARTER TO 220 THIS QUARTER. OF ALL THE
OPERATIONS, SADIOLA HAS HAD AN EXCEPTIONAL QUARTER, PRODUCING AT LEVELS ABOVE
MANAGEMENT'S ONGOING EXPECTATIONS. THE SOUTH AMERICAN MINES HAVE PERFORMED
PARTICULARLY WELL. PRODUCTION INCREASED AT THE SOUTH AFRICAN OPERATIONS,
THOUGH MATJHABENG MINE'S IMPORTANT ELAND SHAFT, DAMAGED IN AN EARTHQUAKE IN
APRIL, ONLY RESUMED PRODUCTION IN EARLY OCTOBER.
THE GAS EXPLOSION AT MPONENG MINE IS A SOURCE OF BOTH GREAT SADNESS AND CONCERN
TO MANAGEMENT. EVERY EFFORT TO LEARN FROM THIS EVENT, AND INDEED, TO ENHANCE
THE QUALITY OF SAFETY AT WORK IS BEING MADE. IN THIS REGARD IT IS PLEASING TO
NOTE THE SAFETY ACHIEVEMENTS OF MOAB KHOTSONG, GREAT NOLIGWA AND TAU LEKOA.
TWO ISSUES HAVE PROFOUNDLY CHANGED SENTIMENT IN GOLD MARKETS. DURING
SEPTEMBER, THE INTERNATIONAL MONETARY FUND DECIDED TO AVOID GOLD SALES AS A
MEANS OF FINANCING DEBT RELIEF. ON 26 SEPTEMBER, EUROPEAN BANKS, INCLUDING
BRITAIN AND SWITZERLAND, ANNOUNCED THAT THEIR GOLD SALES WOULD BE LIMITED TO NO
MORE THAN 2 000 TONNES OVER THE NEXT FIVE YEARS. THIS HAS LAID TO REST THE
NOTION THAT MOST CENTRAL BANKS WERE ABOUT TO SELL MOST OF THEIR GOLD RESERVES.
BOTH THE SPOT PRICE, AND THE LEASE RATES AT WHICH GOLD CAN BE BORROWED, HAVE
MOVED UP DRAMATICALLY.
WHEN WE ANNOUNCED OUR SECOND QUARTER RESULTS WE EXPRESSED THE VIEW THAT GOLD
WAS OVERSOLD, AND INDICATED WE WOULD NOT BE SELLING FORWARD IN THIS MARKET.
THE DETAILS OF OUR HEDGE BOOK ARE SET OUT AS USUAL, AND WE CONTINUE TO BELIEVE
THAT A MEASURE OF PRICE SECURITY IS A WAY OF OPTIMISING OUR OPERATIONS AND THE
VALUE THEY GENERATE FOR OUR SHAREHOLDERS.
WE ARE MAKING AN OFFER TO ACQUIRE 100% OF THE EQUITY OF ACACIA RESOURCES, ONE
OF AUSTRALIA'S MOST SUCCESSFUL GOLD COMPANIES. COMBINED WITH THE NOW
SUBSTANTIAL NORTH AND SOUTH AMERICAN AND AFRICAN PRODUCTION, WE BELIEVE THAT
ACACIA'S GOLD PRODUCTION, GOOD EXPLORATION TRACK RECORD AND MANAGEMENT
COMPETENCIES, WILL CREATE A GLOBAL GOLD COMPANY OF CHOICE.
ANGLOGOLD HAS BEEN ABLE TO ACHIEVE COMPETITIVE RATES OF RETURN FOR OUR
SHAREHOLDERS IN THE GLOOMIEST OF GOLD MARKETS. SHOULD THE GOLD PRICE REMAIN
WHERE IT IS NOW, AND BARRING ANY MAJOR OPERATIONAL PROBLEMS, WE ANTICIPATE A
SATISFACTORY FOURTH QUARTER WITH THE OUTLOOK FOR THE YEAR BEING 7 MILLION
OUNCES OF PRODUCTION AT A CASH COST OF $209 PER OUNCE. ASSUMING A REALISED
GOLD PRICE OF $314 PER OUNCE (AT CURRENT EXCHANGE RATES) THIS SHOULD YIELD NET
EARNINGS OF AROUND R2.6 BILLION WITH HEADLINE EARNINGS BEFORE THE DEFERRED TAX
RATE ADJUSTMENT OF AROUND R2.1 BILLION. IN EARLY 2000, THE COMPANY INTENDS TO
RELEASE A MORE DETAILED STRATEGY, WITH TARGETED ACHIEVEMENTS FOR THE NEXT THREE
YEARS, PARTICULARLY IN THE AREAS OF IMPROVING LABOUR PRODUCTIVITY AND CASH AND
TOTAL COST PERFORMANCE.
NICKY OPPENHEIMER BOBBY GODSELL
CHAIRMAN CHIEF EXECUTIVE OFFICER
28 OCTOBER 1999
GOLD MARKET
THE END OF THE THIRD QUARTER SAW A SHARP IMPROVEMENT IN THE GOLD MARKET,
REFLECTED IN A VERY WELCOME INCREASE IN THE GOLD PRICE. THIS CHANGE CAME AFTER
A QUARTER DURING WHICH THE MARKET REMAINED UNDER PRESSURE FROM NEGATIVE
SENTIMENT AND FEARS OF CONTINUED OFFICIAL SECTOR GOLD SALES. THE GOLD PRICE
SLIPPED TO A 20-YEAR LOW OF $251 PER OUNCE, AND THE AVERAGE SPOT PRICE OF $259
PER OUNCE FOR THE QUARTER COMPARED UNFAVOURABLY WITH THE AVERAGE OF $273 DURING
THE PREVIOUS QUARTER. HOWEVER, BY MID-SEPTEMBER, THE MARKET HAD CONSOLIDATED
AROUND A PRICE OF $255, AND FEARS OF FURTHER DOWNSIDE PRICE MOVEMENT WERE BEING
REPLACED BY MORE POSITIVE VIEWS ON GOLD. SUBSEQUENT EVENTS CAPITALISED ON THIS
FIRMER SENTIMENT AND THE IMPROVED CIRCUMSTANCES IN THE MARKET HAVE CARRIED OVER
INTO OCTOBER.
THE MARKET WAS HELPED IN THE FIRST INSTANCE BY GROWING EVIDENCE THAT THE
INTERNATIONAL MONETARY FUND WOULD FAIL IN ITS PROPOSAL TO SELL SOME 10 MILLION
OUNCES OF ITS TOTAL GOLD HOLDINGS OF 100 MILLION OUNCES AS PART OF A DEBT
RELIEF PACKAGE FOR HEAVILY INDEBTED POOR COUNTRIES. THIS LED THE FUND TO SEEK
OTHER MEANS OF FINANCING WHICH WOULD NOT REQUIRE THE SALE OF GOLD HOLDINGS, AND
BY SEPTEMBER ALTERNATIVE PROPOSALS HAD BEEN TABLED WHICH WOULD AVOID THE SALE
OF GOLD. THIS NEWS CAME IN TIME TO REASSURE THE MARKET FOR THE SECOND BANK OF
ENGLAND GOLD AUCTION ON 21 SEPTEMBER 1999. AS A RESULT, THE MARKET FIRMED
AROUND THE TIME OF THE AUCTION, AND SOME MARKET PARTICIPANTS WITH SHORT
POSITIONS USED THE AUCTION AS AN OPPORTUNITY TO BUY BACK THEIR SHORT POSITIONS.
HOWEVER, THE SINGLE DETERMINING EVENT FOR THE MARKET DURING THE PAST QUARTER
WAS THE ANNOUNCEMENT ON THE NIGHT OF SUNDAY, 26 SEPTEMBER 1999 BY THE MEMBERS
OF THE EUROPEAN CENTRAL BANK, SUPPORTED BY THE CENTRAL BANKS OF BRITAIN AND
SWITZERLAND, OF A CEILING OF 2 000 TONNES OF GOLD SALES BY THAT GROUP OVER THE
NEXT FIVE YEARS. THIS INCLUDES ALL SALES OF GOLD ALREADY ANNOUNCED
(SPECIFICALLY THOSE BY THE UNITED KINGDOM AND SWITZERLAND). THE ANNOUNCEMENT
ALSO INDICATED THAT THOSE BANKS WOULD NOT INCREASE THEIR LENDING OF GOLD INTO
THE MARKET DURING THIS PERIOD. IT HAS SINCE BEEN ESTABLISHED THAT THE UNITED
STATES FEDERAL RESERVE AND THE BANK OF JAPAN WILL SUBSCRIBE TO THIS CAPPING OF
GOLD SALES WITHIN THE SAME LIMITS ANNOUNCED. THE POSITIVE EFFECT ON THE MARKET
WAS IMMEDIATE, AND THE PRICE MOVED UP WITHIN LESS THAN A WEEK BY SOME $80 PER
OUNCE, TOUCHING $340 PER OUNCE EARLY IN OCTOBER OR OVER 30% ABOVE THE LOW FOR
THE THIRD QUARTER.
THE EXTENT OF THE PRICE RISE HAS BEEN INCREASED BY UNCERTAINTY IN THE MARKET AS
TO THE CREDIT POSITIONS OF A NUMBER OF GOLD MINING COMPANIES WITH LARGE HEDGE
POSITIONS IN PROPORTION TO THEIR PRODUCTION. THE MARKET REMAINS VOLATILE TODAY
AT AROUND $300 PER OUNCE, AS IT REFLECTS THE UNCERTAINTY OVER WHETHER OR NOT
PRODUCERS ARE LIKELY TO BUY BACK PARTS OF THEIR FORWARD PRICE EXPOSURES.
THE CENTRAL BANK ANNOUNCEMENT SHOULD BE SEEN IN THE CONTEXT OF A DIALOGUE
BETWEEN LEADING INDIVIDUALS IN THE OFFICIAL SECTOR AND MAJOR GOLD PRODUCERS
STRETCHING BACK SOME TWO YEARS. THE ANNOUNCEMENT REFLECTS THE DEEP CONCERN
AMONGST MANY IN THE OFFICIAL SECTORS OVER NEGATIVE SPECULATION ABOUT OFFICIAL
GOLD SALES WHICH HAS PREVAILED IN THE GOLD MARKET IN RECENT YEARS, AND A DESIRE
TO ELIMINATE THAT DISTORTION FROM THE GOLD MARKET. IN ESSENCE, THE
ANNOUNCEMENT MIRRORS WHAT ANGLOGOLD HAS BELIEVED FOR SOME TIME, THAT OFFICIAL
SECTOR HOLDERS OF GOLD WOULD ALWAYS BE RESPONSIBLE SELLERS IN OUR MARKET, AND
THAT NO AVALANCHE OF OFFICIAL GOLD WOULD OVERWHELM THIS MARKET.
LOOKING FORWARD, OUR MARKET REMAINS VOLATILE, AND WE SHOULD EXPECT CONTINUED
INTEREST IN, AND SUPPORT FOR THE METAL. THERE IS A DEGREE OF UNCERTAINTY
AMONGST MARKET PARTICIPANTS AND A DEGREE OF DISORDER, PARTICULARLY IN THE GOLD
LEASING MARKET. HOWEVER, WE BELIEVE THAT THIS HAS BEEN CAUSED AT LEAST IN PART
BY SOME MISMANAGEMENT OF POSITIONS IN THIS MARKET, AND, ASSUMING THAT OFFICIAL
GOLD LENDING CONTINUES AT AROUND CURRENT LEVELS, THE MARKET SHOULD RETURN TO A
MORE ORDERLY STATE ONCE CURRENT PROBLEMS HAVE BEEN RESOLVED BY THESE AFFECTED
PARTICIPANTS. SHOULD OFFICIAL LENDERS OF GOLD MATERIALLY REDUCE THE AMOUNTS OF
GOLD THAT THEY ARE PREPARED TO LEND TO THIS MARKET, THIS WOULD BRING ABOUT A
QUITE DIFFERENT SITUATION AND IS LIKELY TO LEAD TO FURTHER SHARP RISES IN THE
GOLD PRICE.
ANGLOGOLD'S OPEN HEDGE POSITION AT THE END OF THE THIRD QUARTER IS SUMMARISED
BELOW. WE BELIEVE THAT IT WAS A CORRECT DECISION ON THE PART OF ANGLOGOLD TO
REMAIN OUT OF THE MARKET DURING MUCH OF THIS PAST QUARTER, AS WE BELIEVED THAT
THE PRICE HAD BEEN UNDULY DEPRESSED BY UNJUSTIFIED NEGATIVE SENTIMENT TOWARDS
GOLD. IT IS WORTH NOTING THAT THE COMPANY HAS REMOVED ALL EXPOSURE TO GOLD
LENDING RATES THROUGH TO EARLY 2000. THEREAFTER, WE HAVE ONLY LIMITED EXPOSURE
TO GOLD LENDING RATES, AND THE OVERWHELMING MAJORITY OF THE FORWARD POSITIONS
ARE BASED ON THE FIXED FORWARD PRICES. THIS HAS CONTRIBUTED SUBSTANTIALLY TO
THE STABILITY OF OUR HEDGE POSITION DURING THE CURRENT VOLATILE GOLD PRICES.
AS AT 30 SEPTEMBER 1999, THE COMPANY HAD OUTSTANDING THE FOLLOWING NET FORWARD
PRICING COMMITMENTS AGAINST FUTURE PRODUCTION. A PORTION OF THESE SALES
CONSISTS OF US DOLLAR-PRICED CONTRACTS WHICH HAVE BEEN CONVERTED TO RAND PRICES
AT AVERAGE ANNUAL FORWARD RAND VALUES BASED ON A SPOT RAND/DOLLAR EXCHANGE RATE
OF R6.00 AVAILABLE ON 30 SEPTEMBER 1999. THE PERCENTAGE OF THE SALES PRICED IN
US DOLLARS IS SHOWN BELOW:
FORWARD FORWARD % OF
KG PRICE PER OZ PRICE PER POSITIONS
SOLD KG SOLD SOLD OZ SOLD PRICED IN
R 000 R US$
3 MNTHS ENDING
31 DEC 1999 49 589 61 516 1 594 317 22
12 MNTHS ENDING
31 DEC 2000 93 808 66 425 3 016 331 59
2001 80 978 73 365 2 604 343 58
2002 67 177 79 850 2 160 345 52
2003 37 910 85 613 1 219 342 74
2004 24 627 91 598 792 337 81
JAN 2005 - JUN 2009 74 536 120 967 2 396 359 76
THE AGGREGATE OF US DOLLAR-PRICED CONTRACTS OVER THE FULL DURATION OF THE HEDGE
IS 59%.
THE NET PRESENT VALUE OF ALL HEDGE TRANSACTIONS MAKING UP THE HEDGE POSITIONS
IN THE ABOVE TABLE WAS R624 MILLION ($104 MILLION) AS AT 30 SEPTEMBER 1999. THE
VALUE WAS BASED ON A GOLD PRICE OF $301 PER OUNCE, AN EXCHANGE RATE OF R/$6.00
AND THE PREVAILING MARKET INTEREST RATES AND VOLATILITIES AT THE TIME.
AS AT 27 OCTOBER 1999, THE NET PRESENT VALUE OF THE HEDGE BOOK WAS R840 MILLION
($140 MILLION), BASED ON A GOLD PRICE OF $292.1 PER OUNCE, AN EXCHANGE RATE OF
R/$6.15 AND THE PREVAILING MARKET INTEREST RATES AND VOLATILITIES AT THE TIME.
CERTAIN FORWARD-LOOKING STATEMENTS
CERTAIN STATEMENTS CONTAINED IN THIS DOCUMENT, INCLUDING WITHOUT LIMITATION,
THOSE CONCERNING: (I) THE ECONOMIC OUTLOOK FOR THE GOLD MINING INDUSTRY, (II)
EXPECTATIONS REGARDING GOLD PRICES AND PRODUCTION, (III) THE COMPLETION AND
COMMENCEMENT OF COMMERCIAL OPERATIONS OF CERTAIN OF THE COMPANY'S EXPLORATION
AND PRODUCTION PROJECTS, AND (IV) THE COMPANY'S LIQUIDITY AND CAPITAL RESOURCES
AND EXPENDITURE, CONTAIN CERTAIN FORWARD-LOOKING STATEMENTS CONCERNING THE
COMPANY'S OPERATIONS, ECONOMIC PERFORMANCE AND FINANCIAL CONDITION. ALTHOUGH
THE COMPANY 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, (I) CHANGES IN ECONOMIC AND MARKET CONDITIONS, (II) SUCCESS OF
BUSINESS AND OPERATING INITIATIVES, (III) CHANGES IN THE REGULATORY ENVIRONMENT
AND OTHER GOVERNMENT ACTIONS, (IV) FLUCTUATIONS IN GOLD PRICES AND EXCHANGE
RATES, AND (V) BUSINESS AND OPERATIONAL RISK MANAGEMENT.
QUERIES:
IN SOUTH AFRICA:
JAMES DUNCAN
TELEPHONE: +27 11 637 6147
FAX: +27 11 637 6399/6400
MOBILE : 27 82 892 8052
IN THE UNITED KINGDOM:
ALEX BUCK
TELEPHONE: +44 171 849 5630
FAX: +44 171 849 6137
MOBILE :+44 793 2740452
IN THE UNITED STATES OF AMERICA:
STEVE LENAHAN
TELEPHONE: +1 917 368 8075
FAX: +1 917 368 8077
MOBILE : +27 83 308 2200
CHARLES CARTER
TOLL-FREE: 800 417 9255
TELEPHONE: +1 303 843 9255
FAX: +1 303 694 4969
FOR THE FULL REPORT ON THE QUARTER VISIT THE ANGLOGOLD WEBSITE:
WWW.ANGLOGOLD.COM
GROUP BALANCE SHEET
PREPARED IN ACCORDANCE WITH INTERNATIONAL ACCOUNTING STANDARDS
SEPT. 98 JUNE 99 SEPT. 99
US DOLLAR MILLION SA RAND MILLION
ASSETS
NON-CURRENT ASSETS
1 958.7 2 435.3 2 458.4 MINING ASSETS 14 768.4 14 699.1 11 562.4
- 144.6 138.1 GOODWILL 829.6 872.8 -
120.4 10.9 10.9 INVESTMENTS 65.6 65.4 710.8
84.3 58.8 59.4 LONG-TERM LOANS -
UNSECURED 357.0 354.9 497.4
2 163.4 2 649.6 2 666.8 16 020.6 15 992.2 12 770.6
CURRENT ASSETS
149.7 173.1 167.3 INVENTORIES 1 005.1 1 045.0 883.5
140.2 165.7 191.2 TRADE AND OTHER
RECEIVABLES 1 148.9 1 000.3 827.8
- 21.2 21.2 CURRENT PORTION OF
LOANS ADVANCED 127.1 127.7 -
178.5 484.3 470.8 CASH AND CASH
QUIVALENTS 2 828.3 2 923.0 1 053.7
468.4 844.3 850.5 5 109.4 5 096.0 2 765.0
2 631.8 3 493.9 3 517.3 TOTAL ASSETS 21 130.0 21 088.2 15 535.6
EQUITY AND LIABILITIES
CAPITAL AND RESERVES
901.6 872.9 878.9 SHARE CAPITAL AND
PREMIUM 5 279.8 5 268.8 5 322.3
19.6 25.7 26.0 NON-DISTRIBUTABLE
RESERVE 156.3 155.0 115.9
290.3 364.1 450.2 RETAINED EARNINGS 2 704.7 2 197.6 1 713.7
1 211.5 1 262.7 1 355.1 SHAREHOLDERS'
EQUITY 8 140.8 7 621.4 7 151.9
- 28.2 26.3 MINORITY INTERESTS 158.0 170.2 -
1 211.5 1 290.9 1 381.4 8 298.8 7 791.6 7 151.9
NON-CURRENT LIABILITIES
185.5 714.3 704.5 BORROWINGS 4 232.6 4 311.3 1 095.0
- 16.6 15.8 DEBENTURES 95.1 99.9 -
202.1 293.4 290.2 OTHER LONG-TERM
LIABILITIES 1 743.1 1 771.0 1 192.9
714.4 664.8 667.6 DEFERRED TAXATION 4 010.5 4 012.3 4 217.2
1 102.0 1 689.1 1 678.1 10 081.3 10 194.5 6 505.1
CURRENT LIABILITIES
240.4 218.9 281.0 TRADE AND OTHER
PAYABLES 1 687.8 1 321.5 1 418.6
- 94.0 107.9 CURRENT PORTION OF
BORROWINGS 648.0 567.3 -
77.9 55.1 68.9 TAXATION 414.1 332.5 460.0
- 145.9 - DIVIDENDS - 880.8 -
318.3 513.9 457.8 2 749.9 3 102.1 1 878.6
2 631.8 3 493.9 3 517.3 TOTAL EQUITY AND
LIABILITIES 21 130.0 21 088.2 15 535.6
GROUP CASH FLOW STATEMENT
PREPARED IN ACCORDANCE WITH INTERNATIONAL ACCOUNTING STANDARDS
9 MONTHS 9 MONTHS QUARTER QUARTER 9 MONTHS 9 MONTHS
ENDED ENDED ENDED ENDED ENDED ENDED
SEPT. SEPT. SEPT. SEPT. SEPT. SEPT.
1998 1999 1999 1999 1999 1998
US DOLLAR MILLION SA RAND MILLION
CASH FLOWS FROM OPERATING ACTIVITIES
328.3 486.6 206.7 CASH GENERATED
FROM OPERATIONS 1 256.6 2 964.4 1 816.3
22.9 46.6 16.0 INTEREST RECEIVED 97.6 284.8 124.7
(3.7) (35.3) (15.5) INTEREST PAID (94.1) (215.7) (19.1)
7.4 5.8 0.1 DIVIDENDS RECEIVED 0.4 35.2 38.0
(275.1) (273.5) (144.7) DIVIDENDS PAID (880.8) (1 663.6) (1 411.1)
(58.9) (83.0) (15.2) MINING AND NORMAL
TAXATION PAID (92.2) (505.1) (302.3)
20.9 147.2 47.4 NET CASH INFLOW
FROM OPERATING
ACTIVITIES 287.5 900.0 246.5
CASH FLOWS FROM INVESTING ACTIVITIES
(134.8) (145.5) (53.6) PURCHASE OF MINING
ASSETS (326.5) (884.9) (691.4)
76.6 - - PROCEEDS FROM SALE
OF MINING ASSETS - - 393.0
7.4 1.3 - INVESTMENTS
ACQUIRED 0.1 7.9 (24.6)
- (471.9) (4.9) NET ACQUISITION OF
SUBSIDIARIES (30.0) (2 870.5) -
7.4 216.4 - PROCEEDS FROM SALE
OF INVESTMENTS - 1 316.5 37.9
(43.4) (399.7) (58.5) NET CASH OUTFLOW
FROM INVESTING
ACTIVITIES (356.4) (2 431.0) (285.1)
CASH FLOWS FROM FINANCING ACTIVITIES
- 2.4 1.9 PROCEEDS FROM ISSUE
OF SHARE CAPITAL 11.7 14.6 -
(5.7) (0.4) (0.1) FORMATION AND SHARE
ISSUE EXPENSES (0.7) (2.5) (29.3)
8.9 517.0 2.8 PROCEEDS FROM
BORROWINGS 16.9 3 144.5 45.8
(11.3) (46.2) (14.0) REPAYMENT OF
BORROWINGS (85.0) (281.1) (58.0)
- 15.6 0.6 REPAYMENT ON LOANS
ADVANCED 3.9 94.6 -
(8.1) 488.4 (8.8) NET CASH (OUTFLOW)/
INFLOW FROM FINANCING
ACTIVITIES (53.2) 2 970.1 (41.5)
(30.6) 235.9 19.9) NET (DECREASE)INCREASE
IN CASH AND CASH
EQUIVALENTS (122.1) 1 439.1 (80.1)
(30.0) (19.7) 6.4 TRANSLATION
ADJUSTMENT 27.4 (108.1) (30.7)
239.1 254.6 484.3 OPENING CASH AND
CASH EQUIVALENTS 2 923.0 1 497.3 1 164.5
178.5 470.8 470.8 CLOSING CASH AND
CASH EQUIVALENTS 2 828.3 2 828.3 1 053.7
NOTE TO THE CASH FLOW STATEMENT
CASH GENERATED FROM OPERATIONS
306.3 350.5 115.6 PROFIT ON ORDINARY
ACTIVITIES BEFORE
TAXATION 703.4 2 134.7 1 606.1
ADJUSTED FOR:
110.7 137.7 46.6 AMORTISATION OF
MINING ASSETS 283.3 840.3 598.9
0.1 5.1 2.7 NON-CASH MOVEMENTS 16.2 31.3 12.9
10.8 - - LOSS ON SALE OF
MINING ASSETS - - 117.2
(42.0) (7.1) - INCOME FROM
ASSOCIATES - (43.3) (216.5)
(22.9) (46.6) (16.0) INTEREST RECEIVED (97.6) (284.8) (124.7)
(2.3) (0.4) (0.1) DIVIDENDS RECEIVED (0.4) (2.4) (11.7)
3.7 35.3 15.5 INTEREST PAID 94.1 215.7 19.1
(36.1) 12.1 42.4 MOVEMENT IN WORKING
CAPITAL 257.6 72.9 (185.0)
328.3 486.6 206.7 1 256.6 2 964.4 1 816.3
THE FOLLOWING ANALYSES THE MOVEMENT IN WORKING CAPITAL:
14.8 10.3 6.6 DECREASE IN
INVENTORIES 39.9 62.4 75.7
(35.4) (4.6) (24.4) INCREASE IN TRADE
AND OTHER
RECEIVABLES (148.6) (28.2) (181.4)
(15.5) 6.4 60.2 INCREASE/(DECREASE)
IN TRADE AND OTHER
PAYABLES 366.3 38.7 (79.3)
(36.1) 12.1 42.4 257.6 72.9 (185.0)
GROUP OPERATING RESULTS
PREPARED IN ACCORDANCE WITH INTERNATIONAL ACCOUNTING STANDARDS
STATISTICS ARE SHOWN IN METRIC UNITS AND FINANCIAL FIGURES IN SOUTH AFRICAN
RAND.
ISSUED CAPITAL: 97 923 249 ORDINARY SHARES OF 50 CENTS EACH
2 000 000 A REDEEMABLE PREFERENCE SHARES
778 896 B REDEEMABLE PREFERENCE SHARES
ALL THE PREFERENCE SHARES ARE HELD BY A WHOLLY OWNED SUBSIDIARY COMPANY
QUARTER QUARTER NINE MONTHS
ENDED ENDED ENDED ENDED
SEPTEMBER JUNE
1999 1999 1999 1998
GOLD
UNDERGROUND OPERATIONS
TONNES MILLED - 000 - REEF 5 247 5 309 15 943 16 871
- WASTE 155 142 467 168
- TOTAL 5 401 5 451 16 409 17 039
YIELD - G/T - REEF 8.46 8.26 8.32 8.12
- WASTE 0.83 1.13 0.87 0.99
- AVERAGE 8.24 8.07 8.11 8.05
GOLD PRODUCED - KG - REEF 44 371 43 848 132 625 137 062
- WASTE 128 160 408 166
- TOTAL 44 499 44 008 133 033 137 228
PRODUCTIVITY
G/EMPLOYEE - TARGET 225 220 222 169
- ACTUAL 220 209 212 174
SURFACE AND DUMP RECLAMATION
TONNES TREATED - 000 13 451 13 929 41 203 43 206
YIELD - G/T 0.31 0.29 0.29 0.30
GOLD PRODUCED - KG 4 113 4 091 12 045 12 859
OPEN-PIT OPERATIONS
TONNES MINED - 000 12 399 12 113 36 683 5 320
STRIPPING RATIO - T(MINED-TREATED)
/T TREATED 2.30 2.59 2.50 1.53
TONNES TREATED - 000 3 756 3 372 10 478 2 100
YIELD - G/T 1.79 1.58 1.66 2.55
GOLD PRODUCED - KG 6 725 5 339 17 410 5 348
TOTAL
GOLD PRODUCED - KG 55 337 53 438 162 487 155 435
REVENUE - R/KG SOLD - (EXCLUDING
ACCELERATED HEDGE) 61 589 61 590 61 294 55 900
- (INCLUDING ACCELERATED
HEDGE) 61 754 61 841 61 489 57 951
CASH COSTS - R/KG PRODUCED 40 823 41 314 40 936 39 798
TOTAL PRODUCTION COSTS - R/KG
PRODUCED 46 714 46 968 46 716 46 060
GROUP OPERATING RESULTS
PREPARED IN ACCORDANCE WITH INTERNATIONAL ACCOUNTING STANDARDS
STATISTICS ARE SHOWN IN IMPERIAL UNITS AND FINANCIAL FIGURES IN US DOLLARS.
ISSUED CAPITAL: 2 000 000 A REDEEMABLE PREFERENCE SHARES
778 896 B REDEEMABLE PREFERENCE SHARES
ALL THE PREFERENCE SHARES ARE HELD BY A WHOLLY OWNED SUBSIDIARY COMPANY
1999 1999 1999 1998
GOLD
UNDERGROUND OPERATIONS
TONS MILLED - 000 - REEF 5 784 5 851 17 574 18 597
- WASTE 171 155 514 186
- TOTAL 5 955 6 006 18 088 18 783
YIELD - OZ/T - REEF 0.247 0.241 0.243 0.237
- WASTE 0.024 0.033 0.025 0.029
- AVERAGE 0.240 0.235 0.236 0.235
GOLD PRODUCED - OZ 000 -
REEF 1 426 1 410 4 264 4 406
- WASTE 4 5 13 5
- TOTAL 1 430 1 415 4 277 4 411
PRODUCTIVITY
OZ/EMPLOYEE - TARGET 7.24 7.08 7.13 5.43
- ACTUAL 7.07 6.71 6.81 5.59
SURFACE AND DUMP RECLAMATION
TONS TREATED - 000 14 828 15 355 45 419 47 627
YIELD - OZ/T 0.009 0.009 0.009 0.009
GOLD PRODUCED - OZ 000 133 130 387 414
OPEN-PIT OPERATIONS
TONS MINED - 000 13 667 13 353 40 435 5 864
STRIPPING RATIO - T(MINED-TREATED)
/T TREATED 2.30 2.59 2.50 1.53
TONS TREATED - 000 4 140 3 717 11 550 2 315
YIELD - OZ/T 0.052 0.046 0.048 0.074
GOLD PRODUCED - OZ 000 216 172 560 173
TOTAL
GOLD PRODUCED - OZ 000 1 779 1 717 5 224 4 998
REVENUE - $/OZ SOLD - (EXCLUDING
ACCELERATED HEDGE) 315 313 312 321
- (INCLUDING ACCELERATED
HEDGE) 316 314 313 334
CASH COSTS - $/OUNCE PRODUCED 209 210 209 229
TOTAL PRODUCTION COSTS - $/OUNCE
PRODUCED 239 239 238 271
RAND/US DOLLAR AVERAGE EXCHANGE
RATE 6.09 6.13 6.10 5.40
GROUP FINANCIAL RESULTS
PREPARED IN ACCORDANCE WITH INTERNATIONAL ACCOUNTING STANDARDS
SA RAND MILLION
1999 1999 1999 1998
TURNOVER 3 558.0 3 427.1 10 374.2 9 208.5
GOLD REVENUE 3 452.7 3 339.0 10 109.1 9 036.6
NORMAL 3 443.5 3 325.6 10 077.3 8 716.9
ACCELERATED HEDGE 9.2 13.4 31.8 319.7
COST OF SALES 2 615.4 2 538.7 7 691.7 7 255.1
CASH COSTS 2 283.7 2 229.4 6 715.8 6 186.0
RETRENCHMENT COSTS 9.1 13.4 31.7 319.8
REHABILITATION AND OTHER NON
CASH COSTS 38.1 24.6 88.7 54.5
PRODUCTION COSTS 2 330.9 2 267.4 6 836.2 6 560.3
AMORTISATION OF MINING ASSETS 283.3 273.3 840.3 598.9
TOTAL PRODUCTION COSTS 2 614.2 2 540.7 7 676.5 7 159.2
INVENTORY CHANGE 1.2 (2.0) 15.2 95.9
OPERATING PROFIT 837.3 800.3 2 417.4 1 781.5
CORPORATE ADMINISTRATION AND
OTHER EXPENSES 66.3 63.7 194.2 226.2
RESEARCH AND DEVELOPMENT 11.4 10.9 29.8 13.7
EXPLORATION COSTS 60.1 57.0 173.5 152.1
PROFIT FROM OPERATIONS 699.5 668.7 2 019.9 1 389.5
INTEREST PAID 94.1 92.8 215.7 19.1
INTEREST RECEIVABLE 97.6 109.3 284.8 124.7
INCOME FROM ASSOCIATES - - 43.3 216.5
DIVIDENDS RECEIVED 0.4 0.6 2.4 11.7
LOSS ON SALE OF MINING ASSETS - - - (117.2)
PROFIT ON ORDINARY ACTIVITIES
BEFORE TAXATION 703.4 685.8 2 134.7 1 606.1
TAXATION 172.7 176.6 131.2 369.4
NORMAL TAXATION 173.8 155.5 560.0 660.7
DEFERRED TAXATION - CURRENT (1.1) 21.1 31.1 (291.3)
- RATE CHANGE - - (459.9) -
PROFIT ON ORDINARY ACTIVITIES
AFTER TAXATION 530.7 509.2 2 003.5 1 236.7
PROFIT ON SALE OF ASSOCIATE - 543.2 543.2 -
GOODWILL WRITTEN OFF 32.0 33.1 406.8 -
MINORITY INTEREST 5.5 1.8 17.7 -
PROFIT ATTRIBUTABLE TO ORDINARY
SHAREHOLDERS 493.2 1 017.5 2 122.2 1 236.7
ATTRIBUTABLE EARNINGS - CENTS
PER SHARE 504 1 040 2 168 1 264
HEADLINE EARNINGS - RM 525.2 507.4 1 985.8 1 024.3
- CENTS PER SHARE 537 519 2 029 1 047
HEADLINE EARNINGS BEFORE DEFERRED TAX
RATE ADJUSTMENT - RM 525.2 507.4 1 525.9 1 024.3
- CENTS PER SHARE 537 519 1 559 1 047
DIVIDENDS - RM - - 880.8 729.3
- CENTS PER SHARE - - 900 750
CAPITAL EXPENDITURE - MINING
DIRECT 303.1 268.8 801.0 664.5
- OTHER 23.4 37.2 83.9 26.9
- RECOUPMENTS - - - (393.0)
NET CAPITAL EXPENDITURE 326.5 306.0 884.9 298.4
GROUP FINANCIAL RESULTS
PREPARED IN ACCORDANCE WITH INTERNATIONAL ACCOUNTING STANDARDS
US DOLLAR MILLION
1999 1999 1999 1998
TURNOVER 584.7 559.5 1 699.6 1 705.9
GOLD REVENUE 567.3 545.1 1 656.1 1 673.4
NORMAL 565.8 542.9 1 650.9 1 610.1
ACCELERATED HEDGE 1.5 2.2 5.2 63.3
COST OF SALES 429.7 414.4 1 260.2 1 347.5
CASH COSTS 375.3 363.9 1 100.4 1 145.7
RETRENCHMENT COSTS 1.5 2.2 5.2 63.2
REHABILITATION AND OTHER NON
CASH COSTS 6.1 4.0 14.4 8.8
PRODUCTION COSTS 382.9 370.1 1 120.0 1 217.7
AMORTISATION OF MINING ASSETS 46.6 44.6 137.7 110.7
TOTAL PRODUCTION COSTS 429.5 414.7 1 257.7 1 328.4
INVENTORY CHANGE 0.2 (0.3) 2.5 19.1
OPERATING PROFIT 137.6 130.7 395.9 325.9
CORPORATE ADMINISTRATION AND
OTHER EXPENSES 10.8 10.3 30.9 42.0
RESEARCH AND DEVELOPMENT 1.9 1.8 4.9 2.4
EXPLORATION COSTS 9.9 9.3 28.4 27.9
PROFIT FROM OPERATIONS 115.0 109.3 331.7 253.6
INTEREST PAID 15.5 15.2 35.3 3.7
INTEREST RECEIVABLE 16.0 17.8 46.6 22.9
INCOME FROM ASSOCIATES - - 7.1 42.0
DIVIDENDS RECEIVED 0.1 0.1 0.4 2.3
LOSS ON SALE OF MINING ASSETS - - - (10.8)
PROFIT ON ORDINARY ACTIVITIES
BEFORE TAXATION 115.6 112.0 350.5 306.3
TAXATION 28.4 28.9 21.5 70.7
NORMAL TAXATION 28.5 25.4 91.7 120.2
DEFERRED TAXATION - CURRENT (0.1) 3.5 5.2 (49.5)
- RATE CHANGE - - (75.4) -
PROFIT ON ORDINARY ACTIVITIES
AFTER TAXATION 87.2 83.1 329.0 235.6
PROFIT ON SALE OF ASSOCIATE - 88.7 88.7 -
GOODWILL WRITTEN OFF 5.3 5.4 66.7 -
MINORITY INTEREST 0.9 0.3 2.9 -
PROFIT ATTRIBUTABLE TO ORDINARY
SHAREHOLDERS 81.0 166.1 348.1 235.6
ATTRIBUTABLE EARNINGS - CENTS
PER SHARE 83 170 356 241
HEADLINE EARNINGS - $M 86.3 82.8 326.1 188.7
- CENTS PER SHARE 88 85 333 193
HEADLINE EARNINGS BEFORE
DEFERRED TAX RATE ADJUSTMENT
- $M 86.3 82.8 250.7 188.7
- CENTS PER SHARE 88 85 256 193
DIVIDENDS - $M - - 145.9 123.5
- CENTS PER SHARE - - 149 127
CAPITAL EXPENDITURE - MINING
DIRECT 49.9 43.8 131.3 122.5
- OTHER 3.8 6.1 13.7 5.0
- RECOUPMENTS - - - (71.4)
NET CAPITAL EXPENDITURE 53.7 49.9 145.0 56.1
ENDS
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