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AngloGold Limited - Report to shareholders for the quarter and nine months ended
30 September 2003
AngloGold Limited
Registration No. 1944/017354/06
Incorporated in the Republic of South Africa
ISIN: ZAE000043485
Share codes:
JSE: ANG
LSE: 79 LK
NYSE: AU
ASX: AGG
Euronext Paris: VA FP
Euronext Brussels: ANG BB
Report to shareholders for the quarter and nine months ended
30 September 2003
Group results for the quarter ...
- Adjusted headline earnings1 increase by 2% to $67m
- Adjusted operating profit2 down by 3% to $136m
- Total cash costs increase by 6% to $237/oz impacted by strong local
currencies and wage increases in South Africa
- Gold production (on a comparable basis3) increases marginally to 1.39Moz
- Good performances at Great Noligwa, Kopanang and Geita - Problems persist at
Cerro Vanguardia and CC&V, which are being addressed
- Received gold price4 up by 3% to $364/oz
- Ashanti board unanimously recommends revised AngloGold offer and Government
of Ghana indicates support for the AngloGold/Ashanti merger
Quarter ended 9 months ended
Sept June Sept Sept
2003 2003 2003 2002
Rand/Metric
Gold
Produced kg / oz (000) 43,240 44,613 131,457 136,543
Price received4 R/kg / $/oz 86,619 87,983 88,852 103,567
Total cash costs R/kg / $/oz 56,311 55,502 55,966 54,242
Total
production
costs R/kg / $/oz 65,502 65,654 65,891 68,270
Operating profitR / $ million 1,304 1,094 3,607 5,026
Adjusted
operating
profit2 R / $ million 1,004 1,082 3,303 5,205
Net profit R / $ million 729 444 1,721 2,489
Headline
earnings R / $ million 674 513 1,794 2,899
Adjusted
headline
earnings1 R / $ million 497 516 1,628 2,996
Capital
expenditure R / $ million 661 538 1,687 1,962
Earnings per
ordinary share
Basic cents/share 327 199 773 1,123
Diluted cents/share 326 199 769 1,116
Headline cents/share 303 230 805 1,307
Adjusted
headline
earnings1 cents/share 223 232 731 1,351
Dividends cents/share 375 675
Quarter ended 9 months ended
Sept June Sept Sept
2003 2003 2003 2002
Dollar/Imperial
Gold
Produced kg / oz (000) 1,390 1,434 4,226 4,390
Price received4 R/kg / $/oz 364 354 354 299
Total cash costs R/kg / $/oz 237 223 223 157
Total production costs R/kg / $/oz 275 264 263 197
Operating profit R / $ million 176 142 463 466
Adjusted operating
profit2 R / $ million 136 140 422 483
Net profit R / $ million 97 57 219 231
Headline earnings R / $ million 90 66 228 268
Adjusted headline
earnings1 R / $ million 67 66 207 277
Capital expenditure R / $ million 88 69 216 182
Earnings per ordinary
share
Basic cents/share 44 26 98 104
Diluted cents/share 43 26 98 104
Headline cents/share 40 30 102 121
Adjusted headline
earnings1 cents/share 30 30 93 125
Dividends cents/share 51 64
Note
1. Headline earnings before unrealised non-hedge derivatives and
marked-to-market of debt financial instruments
2. Operating profit excluding unrealised non-hedge derivatives
3. Prior quarter production includes 56,000oz from Jerritt Canyon, which was
sold with effect from 30 June 2003. Reported production is not comparable
4. Price received includes realised non-hedge derivatives
$ represents US dollar, unless otherwise stated
Letter from Chairman and CEO
Dear Shareholder
The decision this week by the Government of Ghana to
support AngloGold"s proposed merger with Ashanti Goldfields is a significant
step towards completion of this transaction.
AngloGold has now secured the support of the Ashanti board
and its two largest shareholders, the Government of Ghana
and Lonmin. Although a further period of three to six months
will be required for the completion of the merger, AngloGold"s
management has already been planning the successful
integration of the companies. In this regard, the fiscal and
regulatory undertakings that the Government of Ghana has confirmed that it
would give, will allow us to lay the foundations
for the Obuasi Deep Project, lengthening the life of mine by
more than 20 years at current production rates or higher.
Obuasi represents possibly the longest life gold orebody in the world.
The merger creates a combination of some of the best gold
assets and mining talent on the African continent, with a spread of long-life,
low-cost operations and reserves around
the world. AngloGold"s management will be greatly
strengthened by the talented Ashanti management team.
When the transaction is complete, AngloGold Ashanti will be
ready to show how a thoroughly African company can be a world leader in its
sector. This is very good news for AngloGold and Ashanti shareholders, the
governments and people of both Ghana and South Africa, the employees of both
companies and their communities.
AngloGold has produced a solid set of financial results for the
September quarter which are similar to those for the second
quarter this year, despite the 4% strengthening of the rand and higher wage
costs in South Africa. Cash operating costs on the South African mines only
increased by 2% in local currency terms. Operating profit, adjusted to exclude
unrealised gains on non-hedge derivatives, decreased marginally to $136
million. Despite this reduction, headline earnings, similarly adjusted,
increased slightly to $67 million, mainly as a result of lower corporate
administration costs.
The quarter saw good operating performances from Geita, Sadiola, Kopanang and
Great Noligwa, all of which reported higher gold production and lower unit
total cash costs. Grades on the South African operations and the underground
operations as a whole increased by some 4%, while those on the open-pit mines
decreased by some 4%, largely as a consequence of the anticipated and
significant grade decline at Morila.
We expect that the operating problems at Cerro Vanguardia in
Argentina, which resulted in a 16% decline in production over
the quarter, will be overcome with the commissioning there this
month of a material scrubber. At Cripple Creek & Victor,
difficulties with the haul truck fleet and the crusher have been
resolved and those associated with the heap leach continue to
receive management attention.
Although total cash costs were well controlled in local currency
terms, the continued strength of these currencies against the
dollar led to a 6% increase in dollar-denominated costs, to
$237 per ounce. A $10 per ounce increase in the received gold
price, which was again this quarter higher than the gold spot price,
ameliorated the effect of reduced production and
stronger operating currencies.
We will continue to give shareholders a clear picture of the
value creation they can expect from both AngloGold"s existing
operations and from our merger with Ashanti in the months
that lie ahead.
Russell Edey Bobby Godsell
Chairman Chief Executive Officer
30 October 2003
Operations at a glance
for the quarter ended 30 September 2003
Price received1 Production Total cash costs
% % %
$/oz Variance oz Variance $/oz Variance
** (000) ** **
Great Noligwa 384 5 217 11 219 2
TauTona 358 170 6 198 6
Morila* 350 4 80 (16) 109 16
Kopanang 385 6 132 15 261 (3)
Mponeng 358 130 2 248 6
Geita* 334 9 88 42 188 (18)
Cripple Creek & Victor 363 6 66 (15) 217 15
Morro Velho 355 (1) 59 7 146 2
Sadiola* 373 7 42 8 195 (8)
Sunrise Dam 357 (2) 85 1 242 (1)
Cerro Vanguardia* 320 (7) 41 (16) 173 14
Tau Lekoa 385 6 79 (4) 317 17
Serra Grande* 354 (1) 24 109 5
Yatela* 358 3 20 (33) 250 26
Union Reefs 360 (1) 23 (18) 240 3
Navachab 360 4 18 (14) 303 38
Ergo 361 3 45 (8) 408 16
Savuka 358 44 (17) 487 27
Other 27 (68)
AngloGold Group 364 3 1,390 (3) 237 6
% %
Variance Variance
$m ** $m **
Great Noligwa 37 28 35 30
TauTona 27 25
Morila* 19 (17) 14 (18)
Kopanang 16 45 14 56
Mponeng 15 (6) 10 (17)
Geita* 12 140 9 243
Cripple Creek & Victor 12 (14) 3
Morro Velho 12 9
Sadiola* 8 33 5 67
Sunrise Dam 8 (33) 3 (50)
Cerro Vanguardia* 7 (42) 2 (67)
Tau Lekoa 5 (29) 4 (33)
Serra Grande* 5 (29) 4 (8)
Yatela* 3 (25) 1 (90)
Union Reefs 2 (33) 2 (33)
Navachab (100) (100)
Ergo (3) 200 (3) 200
Savuka (8) 700 (8) 300
Other (9) (57) 7 40
AngloGold Group 168 136 (3)
1. Price received includes realised non-hedge derivatives
2. Operating profit excluding unrealised non-hedge derivatives
* Attributable
**Variance September 2003 quarter on June 2003 quarter Increase (decrease)
Review of the gold market
The gold market saw yet another volatile and active quarter with a price range
of over $50/oz and a closing price of $385/oz almost $40/oz higher than for
the opening price for the quarter. The average price of $363/oz was $16/oz
higher than the average for the previous quarter. Currency markets also
remained volatile, with the US dollar gaining strongly against the Euro for
much of the quarter only to end the period close to its lows of $1.19 to the
Euro, and fully 10% weaker against the yen. The rand also benefited from the
weaker dollar, touching R6.85 to the dollar during the quarter.
Gold price drivers
The gold price rallied again during the quarter in spite of the strong recovery
in the US dollar against the Euro during July and August, and in spite of
rallies in important equity markets. Also, physical demand for gold remained
depressed and provided no help for the price.
The driver behind the price was overwhelmingly new and growing investor
interest in gold, reflected in buying on the New York Commodity Exchange
(Comex). The quarter saw repeatedly higher levels of net long open positions on
the Comex, reaching a twenty year high of some 17.1Moz or 532t net long in
early September, pushing the gold price to its high of $393/oz for the quarter.
The new levels of interest were driven by a number of factors, including
concerns about global economic recovery, and scepticism about US recovery in
particular. Most analysts also see the US dollar as still overvalued, and the
US currency weakened sharply again during the last month of the quarter.
Many investors in gold now justify their interest in the metal as appropriate
to a range of economic circumstances, good both in the case of a weaker dollar
(stronger US growth and exports, some danger of inflation, and strong gold and
commodity prices) and of a stronger dollar (dampener on US recovery, threat of
deflation, weaker equity markets and gold holding valuable as a defensive
measure).
This investor interest could be sustained over a number of economic
circumstances, and several analysts have recently published higher spot gold
price forecasts for next year.
Investment
The appearance of new investors in gold has been the critical
incremental factor in this market, and the rising gold price over the
past eighteen months has been driven by investment and speculative demand
for gold. Although volatile, this demand essentially fills the gap caused
by falling jewellery demand in the face of higher spot gold prices. The
net long positions of investors on the Comex have been primary drivers of
the gold price over the past two years.
The past year has also seen the emergence of new gold investment products in
the form of exchange traded gold funds. The first of these has been the
Australian instrument launched by Gold Bullion Limited, but further such
investment products are under consideration elsewhere. These products provide
both institutional and private investors with the opportunity to invest in a
traded instrument whose sole underlying asset is physical gold. These products,
if successful could add a new category of demand for gold, and would help to
sustain a healthier price environment.
Physical
The physical market for gold continues to reflect the negative impact of higher
spot prices. Supply is up, and demand is down.
On the supply side, gold mine production for the first half of 2003 increased
by 2% against 2002, whilst scrap gold for sale increased sharply by 26% year on
year, at 513t in the first half of 2003. Net mine supply onto the market,
however, was reduced by over 300t of gold producer hedge reductions. Net
central bank sales were slightly higher than in 2002 at 290t for the first six
months of 2003. By contrast, global gold demand for jewellery was down in most
areas, with a fall overall of some 4% in gold offtake for jewellery worldwide.
Central bank
The September meetings of the IMF saw the first public comment about a renewal
of the 1999 Washington Agreement on official gold sales and lending. The
subject will be considered by the central banks concerned early in 2004, and
comments seem to imply that renewal is a matter of detail, not of principle. In
any extended agreement, the Swiss National Bank would wish to sell a further
130t to complete its original sales target of 1,300t (or approximately half of
its reserves in 1999 when the decision to sell was taken). The Bundesbank has
also expressed an interest in selling 400 to 600t of its current holdings of
3.440t (second only in the world to the US holdings of 8.135t). It seems likely
that the form and extent of the renewal will be orderly and will not negatively
impact the gold market.
Set against any gold sales programme of a renewed Washington Agreement, the
quarter saw news of official sector interest in increasing gold holdings as
well.
Liberalisation of the gold market in China has opened up a measure of debate on
gold"s possible role in that economy. The quarter saw comment by the Bank of
China indicating that it was reasonable that gold should make up a larger
percentage of the State"s foreign exchange reserves. In addition, a survey
indicated Chinese consumer willingness to consider gold in the arena of private
savings. Support was also voiced during the quarter by the Russian central bank
for a level of gold reserves higher than their current official gold holdings.
In the current global economic environment, with American trade and budget
deficits likely to endure for some time, and most analysts and commentators
forecasting further US dollar weakness against both the Euro and major Asian
currencies, the comments from China and Russia seem to reflect a diffidence
about further growth in official US dollar reserves, and a willingness to
reconsider gold as an important reserve asset.
Currency
Although the US dollar recovered steadily against the Euro from early June,
reaching its strongest point of $1.075 to the Euro in August, the recovery was
not sustained. During September, the US currency fell back again close to its
weakest point of $1.19 to the Euro. An important element in the weakening of
the dollar was Japan"s retreat from the strategy of the past year of buying
dollars to keep the Japanese currency relatively weak against the dollar.
During this third quarter, the yen was allowed to strengthen by fully 10%
against the dollar, from an opening exchange rate of y120/$ to its current
level of y108/$. The return of US dollar weakness to the market was given some
official context at the meeting of the G7 Finance Ministers in Dubai in late
September, where members of the G7 stated their position that exchange rates
should reflect economic fundamentals, and that greater flexibility in exchange
rates is desirable for major countries as a means of promoting effective
adjustments reflecting market realities in the international financial system.
This public position by the G7 was viewed as a recognition of the need for
further US dollar weakness.
The rand remains strong, disproportionately so by comparison with the weakening
of the US dollar against the Euro. The most important single factor here is
almost certainly the large interest rate spread in favour of the rand against
all major currencies, and the resultant carry trade in rand-denominated
instruments. This trade is likely to endure until South African interest rates
reduce sufficiently to discourage such funds, or until some other circumstance
changes to the disadvantage of the local currency. Until this does, local gold
producers along with many other sectors of the South African economy will
suffer from lower income derived from USdollar-denominated product, and from
higher production costs expressed in US dollars.
Hedge position
As at 30 September 2003, the group had outstanding, the following
forward-pricing commitments against future production. The total net delta
tonnage of the hedge on this date was 8.66Moz or 269.5t (at 30 June 2003:
8.73Moz or 271.5t).
The marked-to-market value of all hedge transactions making
up the hedge positions was a negative $447m (negative
R3.1bn) as at 30 September 2003 (as at 30 June 2003:
negative $179.3m negative R1.35bn). These values were
based on a gold price of $383.50/oz, exchange rates of
R/$6.95 and A$/$0.6850 and the prevailing market interest rates and
volatilities at the time.
As at 30 October 2003, the marked-to-market value of the
hedge book was a negative $432.2m (negative R2.9bn),
based on a gold price of $386.4/oz and exchange rates of
R/$6.86 and A$/$0.7053 and the prevailing market interest
rates and volatilities at the time.
These marked-to-market valuations are in no way predictive of
the future value of the hedge position or of future impact on the
revenue of the company. The valuation represents the cost of
buying all hedge contracts at the time of valuation, at market
prices and rates available at the time.
Year 2003 2004 2005 2006
DOLLAR GOLD
Forward
contracts Amount (kg) 18,374 26,576 19,862
$ per oz $315 $324 $333
Put options
purchased Amount (kg) 1,016 5,772 2,624 4,918
$ per oz $405 $382 $363 $363
*Delta (kg) 737 2,555 920 1,587
Put options
sold Amount (kg) 6,532 13,997 2,799 4,354
$ per oz $351 $341 $345 $339
*Delta (kg) 440 3,136 715 1,036
Call options
purchased Amount (kg) 7,268 2,189
$ per oz $343 $328
*Delta (kg) 6,996 1,863
Call options
sold Amount (kg) 10,939 12,361 18,227 16,547
$ per oz $378 $363 $338 $346
*Delta (kg) 5,820 8,367 13,966 12,245
RAND GOLD
Forward
contracts Amount (kg) 1,450 8,426 9,078 4,500
Rand per kg R43,860 R87,523 R116,891 R96,436
Put options
purchased Amount (kg) 1,875 1,875 1,875
Rand per kg R93,602 R93,602 R93,602
*Delta (kg) 1,329 590 459
Put options
sold Amount (kg) 1,866
Rand per kg R89,266
*Delta (kg) 1,692
Call options
purchased Amount (kg) 632
Rand per kg R75,428
*Delta (kg) 632
Call options
sold Amount (kg) 8,091 2,813 4,687 4,688
Rand per kg R93,689 R129,715 R131,944 R132,647
*Delta (kg) 825 94 1,457 1,794
Year 2007 2008-2012 Total
DOLLAR GOLD
Forward contracts Amount (kg) 18,974 25,878 109,664
$ per oz $337 $355 $334
Put options purchased Amount (kg) 728 15,058
$ per oz $292 $369
*Delta (kg) 80 5,879
Put options sold Amount (kg) 27,682
$ per oz $343
*Delta (kg) 5,327
Call options purchased Amount (kg) 9,457
$ per oz $340
*Delta (kg) 8,859
Call options sold Amount (kg) 14,308 54,245 126,627
$ per oz $336 $363 $356
*Delta (kg) 11,122 41,435 92,955
RAND GOLD
Forward contracts Amount (kg) 4,541 3,732 31,728
Rand per kg R114,915 R119,580 R102,886
Put options purchased Amount (kg) 5,625
Rand per kg R93,602
*Delta (kg) 2,378
Put options sold Amount (kg) 1,866
Rand per kg R89,266
*Delta (kg) 1,692
Call options purchased Amount (kg) 632
Rand per kg R75,428
*Delta (kg) 632
Call options sold Amount (kg) 2,986 11,944 35,209
Rand per kg R173,119 R209,288 R152,798
*Delta (kg) 493 2,733 7,396
Year 2003 2004 2005 2006
A DOLLAR
GOLD
Forward
contracts Amount (kg) 6,771 5,443 6,221 9,331
A$ per oz A$503 A$531 A$685 A$655
Put
options
purchased Amount (kg)
A$ per oz
*Delta (kg)
Put
options
sold Amount (kg)
A$ per oz
*Delta (kg)
Call
options
purchased Amount (kg) 5,443 3,110 6,221
A$ per oz A$637 A$724 A$673
*Delta (kg) 1,623 877 2,988
Call
options
sold Amount (kg) 4,666
A$ per oz A$675
*Delta (kg) 299
Total net
gold: Delta (kg) 5,848 38,260 57,216 45,754
Delta (oz) 188,004 1,230,090 1,839,506 1,471,034
Year 2007 2008-2012 Total
A DOLLAR GOLD
Forward contracts Amount (kg) 8,398 13,343 49,507
A$ per oz A$623 A$635 A$614
Put options purchased Amount (kg)
A$ per oz
*Delta (kg)
Put options sold Amount (kg)
A$ per oz
*Delta (kg)
Call options purchasedAmount (kg) 3,732 11,197 29,703
A$ per oz A$668 A$702 A$682
*Delta (kg) 1,964 6,365 13,817
Call options sold Amount (kg) 4,666
A$ per oz A$675
*Delta (kg) 299
Total net gold: Delta (kg) 41,644 80,756 269,478
Delta (oz) 1,338,896 2,596,393 8,663,924
The following table indicates the group"s currency hedge position at
30 September 2003
Year 2003 2004 2005 2006
RAND DOLLAR (000)
Forward contracts Amount ($)
Rand per $
Put options purchased Amount ($)
Rand per $
*Delta ($)
Put options sold Amount ($)
Rand per $
*Delta ($)
Call options purchased Amount ($)
Rand per $
*Delta ($)
Call options sold Amount (kg) 10,000
Rand per $ R7.55
*Delta ($) 5
A DOLLAR (000)
Forward contracts Amount ($) 29,428 29,275 10,847
A$er $ A$0.59 A$0.59 A$0.51
Put options purchased Amount ($) 10,000
A$er $ A$0.63
*Delta ($) 6,175
Put options sold Amount ($) 10,000
A$er $ A$0.68
*Delta ($) 4,114
Call options purchased Amount ($)
A$er $
*Delta ($)
Call options sold Amount (kg) 20,000
A$er $ A$0.60
*Delta ($) 5,676
Year 2007 2008-2012 Total
RAND DOLLAR (000)
Forward contracts Amount ($)
Rand per $
Put options purchased Amount ($)
Rand per $
*Delta ($)
Put options sold Amount ($)
Rand per $
*Delta ($)
Call options purchased Amount ($)
Rand per $
*Delta ($)
Call options sold Amount (kg) 10,000
Rand per $ R7.55
*Delta ($) 5
A DOLLAR (000)
Forward contracts Amount ($) 69,550
A$er $ A$0.58
Put options purchased Amount ($) 10,000
A$er $ A$0.63
*Delta ($) 6,175
Put options sold Amount ($) 10,000
A$er $ A$0.68
*Delta ($) 4,114
Call options purchased Amount ($)
A$er $
*Delta ($)
Call options sold Amount (kg) 20,000
A$er $ A$0.60
*Delta ($) 5,676
*The Delta position indicated above reflects the nominal amount of the option
multiplied by the mathematical probability of the option being exercised. This
is calculated using the Black-Scholes option formula with the ruling market
prices, interest rates and volatilities as at 30 September 2003.
GROUP INCOME STATEMENT
Quarter ended
September June
2003 2003
SA Rand million Notes Unaudited Unaudited
3,735 3,907
Gold income 2 (2,821) (2,932)
Cost of sales 914 975
Non-hedge derivatives 390 119
1,304 1,094
Operating profit
Corporate administration and other
expenses (46) (82)
Market development costs (29) (25)
Exploration costs (68) (72)
Interest receivable 56 63
Other net expense (31) (66)
Finance costs (77) (71)
Marked-to-market of debt financial
instruments 7 -
Abnormal item - settlement of claim - -
1,116 841
Profit before exceptional items
Amortisation of goodwill (54) (56)
Impairment of mining assets (252) (95)
(Loss) profit on disposal of assets - 56
Profit on disposal of investments 280 -
Termination of retirement benefit plans - -
1,090 746
Profit on ordinary activities before
taxation
Taxation 3 (334) (266)
756 480
Profit on ordinary activities after
taxation
Minority interests (27) (36)
729 444
Net profit
Adjusted operating profit
The operating profit has been adjusted by
the
following to arrive at adjusted operating
profit:
Operating profit 1,304 1,094
300 12
Unrealised non-hedge derivatives
Adjusted operating profit 1,004 1,082
Headline earnings
The net profit has been adjusted by the
following to
arrive at headline earnings:
Net profit 729 444
Amortisation of goodwill 54 56
Impairment of mining assets 252 95
Loss (profit) on disposal of assets - (56)
Profit on disposal of investments (280) -
Termination of retirement benefit plans - -
Taxation on exceptional items (81) (26)
674 513
Headline earnings
Unrealised non-hedge derivatives and
marked-to- (307) (12)
market of debt financial instruments
Deferred tax on unrealised non-hedge
derivatives 130 15
497 516
Adjusted headline earnings
Earnings per ordinary share (cents)
- Basic 327 199
- Diluted 326 199
- Headline 303 230
- Adjusted headline 223 232
Interim dividends
- Rm
- cents per share
Nine months ended
September September
2003 2002
SA Rand million Unaudited Unaudited
11,580 13,558
Gold income (8,638) (9,208)
Cost of sales 2,942 4,350
Non-hedge derivatives 665 676
3,607 5,026
Operating profit
Corporate administration and other expenses (213) (185)
Market development costs (94) (134)
Exploration costs (215) (233)
Interest receivable 191 288
Other net expense (130) (54)
Finance costs (217) (364)
Marked-to-market of debt financial instruments 7 -
Abnormal item - settlement of claim - (102)
2,936 4,242
Profit before exceptional items
Amortisation of goodwill (168) (226)
Impairment of mining assets (347) -
(Loss) profit on disposal of assets 56 (139)
Profit on disposal of investments 280 -
Termination of retirement benefit plans - 2
2,757 3,879
Profit on ordinary activities before taxation
Taxation (938) (1,284)
1,819 2,595
Profit on ordinary activities after taxation
Minority interests (98) (106)
1,721 2,489
Net profit
Adjusted operating profit
The operating profit has been adjusted by the
following to arrive at adjusted operating
profit:
Operating profit 3,607 5,026
304 (179)
Unrealised non-hedge derivatives
Adjusted operating profit 3,303 5,205
Headline earnings
The net profit has been adjusted by the
following to
arrive at headline earnings:
Net profit 1,721 2,489
Amortisation of goodwill 168 226
Impairment of mining assets 347 -
Loss (profit) on disposal of assets (56) 139
Profit on disposal of investments (280) -
Termination of retirement benefit plans - (2)
Taxation on exceptional items (106) 47
1,794 2,899
Headline earnings
Unrealised non-hedge derivatives and
marked-to- (311) 179
market of debt financial instruments
Deferred tax on unrealised non-hedge
derivatives 145 (82)
1,628 2,996
Adjusted headline earnings
Earnings per ordinary share (cents)
- Basic 773 1,123
- Diluted 769 1,116
- Headline 805 1,307
- Adjusted headline 731 1,351
Interim dividends
- Rm 837 1,506
- cents per share 375 675
The results have been prepared in accordance with International Financial
Reporting Standards (IFRS)
GROUP INCOME STATEMENT
Quarter ended
September June
2003 2003
US Dollar million Notes Unaudited Unaudited
505 505
Gold income
2 (381) (380)
Cost of sales
124 125
Non-hedge derivatives 52 17
176 142
Operating profit
Corporate administration and other
expenses (6) (11)
Market development costs (4) (3)
Exploration costs (9) (9)
Interest receivable 8 9
Other net expense (4) (11)
Finance costs (11) (9)
Marked-to-market of debt financial
instruments 1 -
Abnormal item - settlement of claim - -
151 108
Profit before exceptional items
Amortisation of goodwill (7) (7)
Impairment of mining assets (35) (12)
(Loss) profit on disposal of assets - 7
Profit on disposal of investments 38 -
Termination of retirement benefit plans - -
147 96
Profit on ordinary activities before
taxation
Taxation 3 (46) (34)
101 62
Profit on ordinary activities after
taxation
Minority interests (4) (5)
97 57
Net profit
Adjusted operating profit
The operating profit has been adjusted by
the
following to arrive at adjusted operating
profit:
Operating profit 176 142
40 2
Unrealised non-hedge derivatives
Adjusted operating profit 136 140
Headline earnings
The net profit has been adjusted by the
following to
arrive at headline earnings:
Net profit 97 57
Amortisation of goodwill 7 7
Impairment of mining assets 35 12
Loss (profit) on disposal of assets - (7)
Profit on disposal of investments (38) -
Termination of retirement benefit plans - -
Taxation on exceptional items (11) (3)
90 66
Headline earnings
Unrealised non-hedge derivatives and
marked-to-
(41) (2)
market of debt financial instruments
Deferred tax on unrealised non-hedge
derivatives 18 2
67 66
Adjusted headline earnings
Earnings per ordinary share (cents)
- Basic 44 26
- Diluted 43 26
- Headline 40 30
- Adjusted headline 30 30
Interim dividends 1
- $m
- cents per share
Nine months ended
September September
2003 2002
US Dollar million Unaudited Unaudited
1,482 1,260
Gold income
(1,107) (856)
Cost of sales
375 404
Non-hedge derivatives 88 62
463 466
Operating profit
Corporate administration and other expenses (27) (17)
Market development costs (12) (12)
Exploration costs (28) (22)
Interest receivable 24 27
Other net expense (17) (5)
Finance costs (28) (34)
Marked-to-market of debt financial instruments 1 -
Abnormal item - settlement of claim - (10)
376 393
Profit before exceptional items
Amortisation of goodwill (21) (21)
Impairment of mining assets (47) -
(Loss) profit on disposal of assets 7 (12)
Profit on disposal of investments 38 -
Termination of retirement benefit plans - -
353 360
Profit on ordinary activities before taxation
Taxation (122) (119)
231 241
Profit on ordinary activities after taxation
Minority interests (12) (10)
219 231
Net profit
Adjusted operating profit
The operating profit has been adjusted by the
following to arrive at adjusted operating profit:
Operating profit 463 466
41 (17)
Unrealised non-hedge derivatives
Adjusted operating profit 422 483
Headline earnings
The net profit has been adjusted by the following to
arrive at headline earnings:
Net profit 219 231
Amortisation of goodwill 21 21
Impairment of mining assets 47 -
Loss (profit) on disposal of assets (7) 12
Profit on disposal of investments (38) -
Termination of retirement benefit plans - -
Taxation on exceptional items (14) 4
228 268
Headline earnings
Unrealised non-hedge derivatives and marked-to-
(42) 17
market of debt financial instruments
Deferred tax on unrealised non-hedge derivatives 21 (8)
207 277
Adjusted headline earnings
Earnings per ordinary share (cents)
- Basic 98 104
- Diluted 98 104
- Headline 102 121
- Adjusted headline 93 125
Interim dividends 1
- $m 113 142
- cents per share 51 64
1 Dividends are translated at actual rates on date of payment
The results have been prepared in accordance with International Financial
Reporting Standards (IFRS)
GROUP BALANCE SHEET
As at As at As at As at
September June December September
2003 2003 2002 2002
SA Rand million Unaudited Unaudited Audited Unaudited
ASSETS
Non-current assets
Mining assets 17,711 18,283 19,555 21,845
Goodwill 2,735 2,980 3,210 4,012
Investments in associates 151 155 165 154
Other investments 174 219 197 201
AngloGold Environmental
Rehabilitation Trust 297 292 275 238
Other non-current assets 551 565 466 505
Derivatives 563 592 549 867
22,182 23,086 24,417 27,822
Current assets
Inventories 1,781 1,778 1,848 2,200
Trade and other
receivables 1,316 1,523 2,190 2,464
Cash and cash equivalents 3,765 2,330 3,544 3,645
Current portion of other
non-current assets 62 67 3 4
Derivatives 2,762 1,954 1,996 1,561
9,686 7,652 9,581 9,874
TOTAL ASSETS 31,868 30,738 33,998 37,696
EQUITY AND LIABILITIES
Equity
10,784 12,146 12,375 12,804
Shareholders" equity
Minority interests 257 304 347 402
11,041 12,450 12,722 13,206
Non-current liabilities
Borrowings 5,758 4,122 7,219 9,106
Provisions 1,744 1,798 2,008 2,118
Deferred taxation 4,011 3,953 3,445 2,977
Derivatives 1,647 1,200 2,028 3,479
13,160 11,073 14,700 17,680
Current liabilities
Current portion of
borrowings 2,264 2,547 719 990
Trade and other payables 2,049 2,181 2,145 2,470
Taxation 267 193 1,124 1,331
Derivatives 3,087 2,294 2,588 2,019
7,667 7,215 6,576 6,810
TOTAL EQUITY AND
LIABILITIES 31,868 30,738 33,998 37,696
The results have been prepared in accordance with International Financial
Reporting Standards (IFRS)
GROUP BALANCE SHEET
As at As at As at As at
September June December September
2003 2003 2002 2002
US Dollar million Unaudited Unaudited Audited Unaudited
ASSETS
Non-current assets
Mining assets 2,552 2,443 2,280 2,071
Goodwill 394 398 374 380
Investments in associates 22 21 19 15
Other investments 25 29 23 19
AngloGold Environmental
Rehabilitation Trust 43 39 32 23
Other non-current assets 79 75 55 48
Derivatives 81 79 64 82
3,196 3,084 2,847 2,638
Current assets
Inventories 257 238 216 209
Trade and other
receivables 190 203 255 234
Cash and cash equivalents 542 311 413 346
Current portion of other
non-current assets 9 9 - -
Derivatives 398 261 233 148
1,396 1,022 1,117 937
4,592 4,106 3,964 3,575
TOTAL ASSETS
EQUITY AND LIABILITIES
Equity
1,555 1,622 1,443 1,216
Shareholders" equity
Minority interests 37 41 40 38
1,592 1,663 1,483 1,254
Non-current liabilities
Borrowings 830 551 842 863
Provisions 251 240 234 201
Deferred taxation 578 528 402 282
Derivatives 237 160 236 330
1,896 1,479 1,714 1,676
Current liabilities
Current portion of
borrowings 326 340 84 94
Trade and other payables 295 291 250 234
Taxation 38 26 131 126
Derivatives 445 307 302 191
1,104 964 767 645
TOTAL EQUITY
AND LIABILITIES 4,592 4,106 3,964 3,575
The results have been prepared in accordance with International Financial
Reporting Standards (IFRS)
GROUP CASH FLOW STATEMENT
Quarter ended Nine months ended
September June September September
2003 2003 2003 2002
SA Rand million Unaudited Unaudited Unaudited Unaudited
Cash flows from
operating activities
Cash generated from
operations 1,043 1,106 3,626 6,150
Interest received 46 53 161 258
Environmental and other
expenditure (41) (33) (125) (105)
Dividends received from
associates - - 9 19
Finance costs (67) (58) (211) (333)
Recoupment tax
received: Free State
assets - 681 681 -
Recoupment tax paid:
Free State assets - (681) (681) -
Taxation paid (51) (547) (677) (932)
Net cash inflow from
operating activities 930 521 2,783 5,057
Cash flows from
investing activities
Capital expenditure (661) (538) (1,687) (1,962)
Proceeds from disposal
of mining assets 5 14 18 -
Net proceeds from
disposal of mines - - - 1,554
Proceeds - - - 1,819
Contractual obligations - - - (265)
Investments acquired - (3) (3) (356)
Proceeds from disposal
of investments 351 - 351 1,834
Acquisition of
subsidiary - - - (979)
Disposal of subsidiary - 8 8 -
Loans advanced (2) (6) (10) (49)
Repayment of loans
advanced 14 7 22 151
Net cash (outflow)
inflow from investing
activities (293) (518) (1,301) 193
Cash flows from
financing activities
Proceeds from issue of
share capital 21 3 41 89
Share issue expenses (1) (1) (2) (116)
Proceeds from borrowings 2,182 75 2,330 8,520
Repayment of borrowings (366) (305) (780) (9,339)
Dividends paid (882) (38) (2,442) (2,792)
Net cash inflow
(outflow) from
financing activities 954 (266) (853) (3,638)
Net increase (decrease)
in cash and cash
equivalents 1,591 (263) 629 1,612
Translation (156) (93) (408) (251)
Opening cash and cash
equivalents 2,330 2,686 3,544 2,284
Closing cash and cash
equivalents 3,765 2,330 3,765 3,645
Cash generated from
operations
Profit on ordinary
activities before
taxation 1,090 746 2,757 3,879
Adjusted for:
Non-cash movements (97) (15) (189) (147)
Amortisation of mining
assets 391 444 1,284 1,908
Interest receivable (56) (63) (191) (288)
Other net income (3) 26 87 (12)
Finance costs 77 71 217 364
Movement on non-hedge
derivatives (337) (26) (351) 179
Amortisation of goodwill 54 56 168 226
Impairment of mining
assets 252 95 347 -
Loss (profit) on
disposal of assets - (56) (56) 86
Termination of
retirement benefit
plans - - - (2)
Profit on disposal of
investments (280) - (280) -
Movement in working
capital (48) (172) (167) (43)
1,043 1,106 3,626 6,150
Movement in working
capital:
Decrease (increase) in
trade and other
receivables 207 (99) 192 240
(Increase) decrease in
inventories (1) 26 54 (253)
Decrease in trade and
other payables (254) (99) (413) (30)
(48) (172) (167) (43)
The results have been prepared in accordance with International Financial
Reporting Standards (IFRS)
GROUP CASH FLOW STATEMENT
Quarter ended Nine months ended
September June September September
2003 2003 2003 2002
US Dollar million Unaudited Unaudited Unaudited Unaudited
Cash flows from
operating activities
Cash generated from
operations 145 130 457 570
Interest received 6 7 20 24
Environmental and other
expenditure (5) (4) (15) (10)
Dividends received from
associates - - 1 2
Finance costs (9) (8) (27) (31)
Recoupment tax
received: Free State
assets - 91 91 -
Recoupment tax paid:
Free State assets - (91) (91) -
Taxation paid (11) (62) (83) (86)
Net cash inflow from
operating activities 126 63 353 469
Cash flows from
investing activities
Capital expenditure (88) (69) (216) (182)
Proceeds from disposal
of mining assets 1 2 3 -
Net proceeds from
disposal of mines - - - 141
Proceeds - - - 164
Contractual obligations - - - (23)
Investments acquired - - - (33)
Proceeds from disposal
of investments 45 - 45 159
Acquisition of
subsidiary - - - (97)
Disposal of subsidiary - 1 1 -
Loans advanced - (1) (1) (5)
Repayment of loans
advanced 1 1 2 14
Net cash (outflow)
inflow from investing
activities (41) (66) (166) (3)
Cash flows from
financing activities
Proceeds from issue of
share capital 3 - 6 8
Share issue expenses - - - (11)
Proceeds from borrowings 296 9 314 789
Repayment of borrowings (48) (38) (100) (865)
Dividends paid (119) (5) (309) (257)
Net cash inflow
(outflow) from
financing activities 132 (34) (89) (336)
Net increase (decrease)
in cash and cash
equivalents 217 (37) 98 130
Translation 14 8 31 25
Opening cash and cash
equivalents 311 340 413 191
Closing cash and cash
equivalents 542 311 542 346
Cash generated from
operations
Profit on ordinary
activities before
taxation 147 96 353 360
Adjusted for:
Non-cash movements (13) (2) (25) (14)
Amortisation of mining
assets 53 57 164 178
Interest receivable (8) (9) (24) (27)
Other net income (2) 4 11 (1)
Finance costs 11 9 28 34
Movement on non-hedge
derivatives (45) (3) (47) 17
Amortisation of goodwill 7 7 21 21
Impairment of mining
assets 35 12 47 -
Loss (profit) on
disposal of assets - (7) (7) 8
Termination of
retirement benefit
plans - - - -
Profit on disposal of
investments (38) - (38) -
Movement in working
capital (2) (34) (26) (6)
145 130 457 570
Movement in working
capital:
Decrease (increase) in
trade and other
receivables 14 (28) (25) 2
(Increase) decrease in
inventories (19) (9) (43) (46)
Decrease in trade and
other payables 3 3 42 38
(2) (34) (26) (6)
The results have been prepared in accordance with International Financial
Reporting Standards (IFRS)
STATEMENT OF CHANGES IN SHAREHOLDERS" EQUITY
Ordinary
share Non - Foreign
capital and distributable currency
premium reserves translation
SA Rand million
Balance at 31 December 2001 8,140 143 2,999
Movements on other
comprehensive income
Net profit
Dividends paid
Ordinary shares issued 1,397
Transfer from
non-distributable reserves (6)
Translation (870)
Balance at 30 September 2002 9,537 137 2,129
Balance at 31 December 2002 9,607 138 360
Movements on other
comprehensive income
Net profit
Dividends paid
Ordinary shares issued 39
Transfer from
non-distributable reserves -
Translation (1,138)
Balance at 30 September 2003 9,646 138 (778)
Other
comprehensive Retained
income earnings Total
SA Rand million
Balance at 31 December 2001 (1,057) 3,132 13,357
Movements on other comprehensive
income (829) (829)
Net profit 2,489 2,489
Dividends paid (2,728) (2,728)
Ordinary shares issued 1,397
Transfer from non-distributable
reserves 6 -
Translation (12) - (882)
Balance at 30 September 2002 (1,898) 2,899 12,804
Balance at 31 December 2002 (1,583) 3,853 12,375
Movements on other comprehensive
income (69) (69)
Net profit 1,721 1,721
Dividends paid (2,337) (2,337)
Ordinary shares issued 39
Transfer from non-distributable
reserves - -
Translation 193 - (945)
Balance at 30 September 2003 (1,459) 3,237 10,784
Ordinary
share Non - Foreign
capital and distributable currency
premium reserves translation
US Dollar million
Balance at 31 December 2001 681 12 250
Movements on other
comprehensive income
Net profit
Dividends paid
Ordinary shares issued 129
Transfer from
non-distributable reserves (1)
Translation 94 2 (46)
Balance at 30 September 2002 904 13 204
Balance at 31 December 2002 1,120 16 43
Movements on other
comprehensive income
Net profit
Dividends paid
Ordinary shares issued 5
Transfer from
non-distributable reserves -
Translation 265 5 (155)
Balance at 30 September 2003 1,390 21 (112)
Other
comprehensive Retained
income earnings Total
US Dollar million
Balance at 31 December 2001 (88) 262 1,117
Movements on other comprehensive income (69) (69)
Net profit 231 231
Dividends paid (251) (251)
Ordinary shares issued 129
Transfer from non-distributable
reserves 1 -
Translation (23) 32 59
Balance at 30 September 2002 (180) 275 1,216
Balance at 31 December 2002 (185) 449 1,443
Movements on other comprehensive income (2) (2)
Net profit 219 219
Dividends paid (296) (296)
Ordinary shares issued 5
Transfer from non-distributable
reserves - -
Translation (23) 94 186
Balance at 30 September 2003 (210) 466 1,555
The results have been prepared in accordance with International Financial
Reporting Standards (IFRS)
Notes
1. Basis of preparation
The financial statements have been prepared in accordance with the historic
cost convention, except for certain financial instruments, which have been
stated at fair value. The group"s accounting policies used in the preparation
of the interim financial statements are consistent with those used in the
annual financial statements for the year ended 31 December 2002.
The summarised group financial statements have been prepared in accordance
with International Financial Reporting Standards (IFRS) and South African
Generally Accepted Accounting Practices (SA GAAP), in compliance with the
Listings Requirements of the JSE Securities Exchange South Africa (JSE) and
in the manner required by the South African Companies Act, 1973 for the
preparation of interim financial information. Accordingly, the financial
statements do not include all the information and disclosures required by
IFRS, SA GAAP and in the manner required by the South African Companies Act,
1973 for annual consolidated financial statements.
2. Cost of sales
Rm (unaudited)
Quarter ended Nine months ended
Sept June Sept Sept
2003 2003 2003 2002
Cash operating costs 2,395 2,429 7,202 7,305
Other cash costs 60 63 193 201
Total cash costs 2,455 2,492 7,395 7,506
Retrenchment costs 7 2 13 30
Rehabilitiation and other non-
cash costs 17 25 65 46
Production costs 2,479 2,519 7,473 7,582
Amortisation of mining assets 391 444 1,284 1,908
Total production costs 2,870 2,963 8,757 9,490
Inventory change (49) (31) (119) (282)
2,821 2,932 8,638 9,208
$m (unaudited)
Quarter ended Nine months ended
Sept June Sept Sept
2003 2003 2003 2002
Cash operating costs 324 314 923 679
Other cash costs 8 9 25 18
Total cash costs 332 323 948 697
Retrenchment costs 1 1 2 3
Rehabilitiation and other non-
cash costs 2 3 8 4
Production costs 335 327 958 704
Amortisation of mining assets 53 57 164 178
Total production costs 388 384 1,122 882
Inventory change (7) (4) (15) (26)
381 380 1,107 856
3. Taxation
Rm (unaudited)
Quarter ended Nine months ended
Sept June Sept Sept
2003 2003 2003 2002
Normal taxation 93 151 489 1,104
Deferred taxation 192 126 410 262
Deferred tax on unrealised
non-hedge derivatives 130 15 145 (82)
Taxation on abnormal item (47)
Taxation on exceptional items (81) (26) (106) 47
334 266 938 1,284
$m (unaudited)
Quarter ended Nine months ended
Sept June Sept Sept
2003 2003 2003 2002
Normal taxation 13 20 61 107
Deferred taxation 26 15 54 21
Deferred tax on unrealised
non-hedge derivatives 18 2 21 (8)
Taxation on abnormal item (5)
Taxation on exceptional items (11) (3) (14) 4
46 34 122 119
4. Shares
30 Sept 2003 30 June 2003 30 Sept 2002
Shares in issue:
Ordinary shares 222,946,842 222,785,154 222,278,426
A redeemable preference
shares 2,000,000 2,000,000 2,000,000
B redeemable preference
shares 778,896 778,896 778,896
Weighted average number of
ordinary shares for the
year:
Basic 222,772,159 222,737,513 221,736,404
Diluted 223,817,500 223,437,590 223,024,350
During the quarter, 161,688 ordinary shares were allotted in terms of the
AngloGold Share Incentive Scheme. All the preference shares are held by a
wholly-owned subsidiary company.
5. Capital commitments:
Orders placed and outstanding on capital contracts at the prevailing rate of
exchange on that date:
Rm
30 Sept 30 June 31 Dec 30 Sept
2003 2003 2002 2002
864 1,123 918 1,067
$m
30 Sept 30 June 31 Dec 30 Sept
2003 2003 2002 2002
118 150 107 101
6. Exchange rates
30 Sept 30 June 31 Dec 30 Sept
2003 2003 2002 2002
Rand/US dollar average year to
date 7.82 8.03 10.48 10.79
Rand/US dollar average quarterly 7.40 7.73 9.62 10.42
Rand/US dollar closing 6.94 7.48 8.58 10.55
7. Interest
Although AngloGold holds a 66.7% interest in Cripple Creek & Victor Gold Mining
Company Limited, it is currently entitled to receive 100% of the cash flow from
the operation until the loan, extended to the joint venture by AngloGold North
America Inc., is repaid.
8. Bond
AngloGold launched a senior unsecured, five year, R2 billion bond on 21 August
2003 at a spread of 118 basis points to the South African R194 government bond
at a fixed semi-annual coupon of 10.5%. The Bond was listed on the Bond
Exchange of South Africa under the code "AG01" on 28 August 2003 and has a
maturity date of 28 August 2008. Coupons are payable on 28 August and 28
February. This debut bond issue was placed with a wide spread of domestic
institutional investors.
9.Announcements: Since 1 July 2003, AngloGold made the following announcements:
9.1 Further to the announcements made by AngloGold on 16 May 2003 and 13 June
2003, AngloGold and Ashanti Goldfields Company Limited issued a joint
announcement on 4 August 2003, which detailed the proposed merger of the two
companies. The Transaction Agreement which was signed by both parties outlined
the terms and structure of the merger. In essence, the merger, which would be
effected by means of a scheme of arrangement between Ashanti and its
shareholders, proposed that AngloGold offer to Ashanti shareholders, 26
AngloGold shares for every 100 Ashanti ordinary shares and global depositary
securities. This announcement was followed by further cautionary announcements
on 22 September 2003, in which AngloGold advised that it was awaiting a
response from the Government of Ghana, a substantial shareholder and regulator
of Ashanti, on whether it would support the merger, and on 23 September 2003 in
which AngloGold advised that it had reached agreement with Ashanti to extend
the Transaction Agreement to 31 October 2003, or such later date as may be
agreed by Ashanti and AngloGold.On 15 October 2003 it was announced that
AngloGold had increased its offer to 29 AngloGold ordinary shares for every 100
Ashanti ordinary shares and global depositary securities and that the board of
Ashanti had resolved to recommend the proposed merger to its shareholders.
Lonmin Plc, which holds 27.6% of Ashanti"s issued share capital, has undertaken
to vote its shares in favour of the merger. The merger is conditional on the
support of the Government of Ghana as shareholder and regulator of Ashanti, the
approval of the scheme of arrangement and its confirmation by the High Court of
Ghana and certain other regulatory approvals and third party consents, as
detailed in the 4 August 2003 announcement. On 29 October 2003 it was announced
that the Government of Ghana supported AngloGold"s proposed merger with
Ashanti. On 30 October 2003, AngloGold announced the principal terms of
commitments with the Government of Ghana.
9.2 On 18 September 2003 AngloGold and Gold Fields Limited jointly announced
that agreement had been reached on the sale by Gold Fields of a portion of
the Driefontein mining area to AngloGold for a cash consideration of R315
million.
Copies of the detailed announcements may be accessed from the AngloGold website
on www.anglogold.com.
10. Dividends: Interim dividend No. 94 of 375 South African cents or 31.964 UK
pence per share was paid to registered shareholders on 29 August 2003,
while a dividend of 15.7425 Australian cents per CHESS Depositary Interest
(CDI) was paid on the same day. Each CDI represents one-fifth of an
ordinary share. A dividend was paid to holders of American Depositary
Receipts (ADRs) on 9 September 2003 at a rate of 50.73 US cents per
American Depositary Share (ADS). Each ADS represents one ordinary share.
11. The group financial statements for the quarter and nine months ended 30
September 2003 were authorised for issue in accordance with a resolution of
the directors passed on 30 October 2003. AngloGold is a limited liability
company incorporated in the Republic of South Africa.
12. This report contains a summary of the results of AngloGold"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
Russell Edey Bobby Godsell
Chairman Chief Executive Officer
30 October 2003
Exploration
AngloGold"s exploration activities are focused on discovering long-life,
low-cost orebodies, utilising multi-disciplinary teams and appropriate
state-of-the-art exploration techniques and technology.
During the quarter
Exploration continued to yield encouraging results from several projects the
satellite oxide exploration programme at Sadiola and deeper mineralisation
extensions at Sunrise Dam in particular.
Regional exploration overview
1. In Mali drilling for satellite oxide resources at Sadiola continued to yield
positive results. Reverse Circulation (RC) results at the FE3 Southern
Extension included: 22m at 8.90g/t from 68m in AFE3S-115 and 44m at 3.71g/t
from 36m in AFE3S-114. Resource delineation drilling of the Western Lobe at
FE4 continued during the quarter and the deposit still appears to be
open-ended to the south-west and west of the current pit position. RC
results included: 32m at 2.58g/t from 142m in AFE4-387 and 10m at 2.04g/t
from 38m in AFE4-383.
Phase VI of the hard sulphides diamond drilling programme at Sadiola is 73%
complete.
2. Encouraging results continue to be received from a first pass Rotary
Airblast (RAB) drilling campaign at the Garalo greenfields prospect, some
100km south-west of Morila. These will be followed by an RC drilling programme
after the rainy season in the fourth quarter.
3. At Geita in Tanzania, exploration drilling was completed at Nyankanga West
and East and restarted at Geita Hill.Follow-up diamond drilling of a high-grade
zone at Nyankanga West intersected further high-grade mineralisation in
drillhole NYDD0147. Results included 4m at 190.20g/t from 189m and 13m at
66.20g/t from 184m. Results of infill down-dip drilling of the north-eastern
side of the Geita Hill pit included: 7m at 7.00g/t from 316m in GHDD-127 and 6m
at 6.31g/t from 316m in GHDD-129.
4. Drilling at the Navachab expansion project in Namibia was completed. The
pre-feasibility study is scheduled for completion in the fourth quarter and,
if the results are positive, a feasibility study will take place in 2004.
5. In North America, exploration continued at Cripple Creek, where over 21,500m
of drilling was completed to define new mineralisation at the Wild Horse
Extension (WHEX) project and to test targets proximal to the current reserve
areas. In addition, drill testing for deep, high-grade mineralisation in the
district continued. Encouraging results were obtained and additional
drilling has been scheduled for the fourth quarter.
6. In Alaska exploration continued on greenfields projects within the Tintina
Gold Belt where geophysical surveying, geochemical sampling and
approximately 2,000m of drilling was completed on three projects.
Encouraging results were obtained and will be the focus of follow-up
exploration.
7. In Canada, exploration at the Red Lake Joint Venture was devoted to the
Rivard area where geochemical sampling and over 1,600m of drilling was
conducted in the quarter.Results of three years of exploration suggest that the
western portion of the Red Lake Greenstone Belt is more prospective.
Accordingly, AngloGold has arranged with its partner Rubicon, to dissolve the
Joint Venture and rationalise the tenement portfolio to leave AngloGold holding
100% of the western area at Rivard.
8. In South America ongoing diamond drilling of the Cachorro Bravo orebody at
Crrego do Stio in Brazil has confirmed flat, north-plunging, sulphide
mineralisation over a down-plunge length of 800m, to a vertical depth of
350m. Intersections ranged in grade between 4.00g/t and 13.00g/t over
widths of 2m to 4m. The exploration ramp has intersected the 4m
thick, well-developed, main ore zone at its anticipated position
and assay results are pending. All intersection lengths closely
approximate to true widths.
9. At the Crixs Mine in Brazil, diamond drilling of the upper Forquilha Sul ore
zone has confirmed continuity of mineralisation over a strike length of
approximately 200m and a down-plunge length of 300m at an approximate
vertical depth of 350m. This ore zone, which overlies the principal Mina III
orebody, has been intercepted in 8 diamond holes, spaced approximately 50m
both along strike and downdip, yielded grades varying between 3.00g/t and
7.50g/t over widths of 3 to 10m. The mineralisation has been closed off
up-plunge but is still open down-plunge. All intersection lengths are
closely approximate to true widths.
10. At Cerro Vanguardia in Argentina, drilling continued to define depth and
strike extensions of the Loma del Muerto, Loma Sur, Paula and Mangas Sur
veins for possible future open-pit and underground resources.
11. In Peru, regional greenfields exploration was focused on further
reconnaissance and property-scale investigation in different areas of the
Peruvian Andean region. At La Rescatada the present diamond drilling
programme has been extended to year-end to drill test three oxide targets
and conduct metallurgical test work in order to reach a decision point by
year-end.
12. In Australia drilling at Sunrise Dam has largely focused on deep drilling
within and beneath the Sunrise Shear. The Sunrise Shear mineralisation was
extended approximately 200m to the northwest on the down-dip extension of
the underground resource. The Dolly Lode was intersected at a drilled depth
of 1,071m (6m at 5.92g/t in CD827W2), approximately 400m beneath previous
drill intercepts, indicating extensions of the structure at depth.
Additional narrow, high-grade mineralisation was intersected in the Dolly
Hanging Wall Lodes, including 3m at 19.43g/t from 704m (CD827). Shallow
mineralisation was again intersected immediately west of the pit in the
previously defined Mako and Duckpond areas and could indicate potential for
a small high-grade pod of saprolite mineralisation. Furthermore, a new zone
of mineralisation has been identified immediately to the west of the
current pit design with an intersection of 6m at 5.15g/t from 153m (CRC101)
and 2m at 41.31g/t from 61m (CRC104). Further drilling is required to
understand the geometry and extent of this zone.
13. In South Africa two diamond drill holes G49 and G51 are in progress at
Goedgenoeg to the west of Tau Lekoa.Diamond drill hole G50 was completed during
the quarter and intersected the Ventersdorp Contact Reef at a depth of 2,227m,
yielding a mean borehole value of 22.08g/t over 18.52cm for 409cmg/t. The five
deflection values varied between 83.60g/t over 16.91cm for 1,414cmg/t to 0.26
g/t over 11.88cm for 3cmg/t (corrected width).
Note:
Unless otherwise stated, all intercepts are at drilled widths and
drilled depths.
Administrative Information
AngloGold Limited
Registration No. 1944/017354/06
Incorporated in the Republic of South Africa
ISIN: ZAE000043485
Share codes:
JSE: ANG
LSE: 79 LK
NYSE: AU
ASX: AGG
Euronext Paris: VA FP
Euronext Brussels: ANG BB
JSE Sponsor: UBS
Auditors: Ernst & Young
Contacts
South Africa
Steve Lenahan
Telephone: +27 11 637 6248
Fax: +27 11 637 6400
E-mail: slenahan@anglogold.com
Peta Baldwin
Telephone: +27 11 637 6647
Fax: +27 11 637 6399
E-mail: pbaldwin@anglogold.com
Europe/Asia
Tomasz Nadrowski
Telephone: +1 212 750 7999
Fax: +1 212 750 5626
E-mail: tnadrowski@anglogold.com
United States of America
Charles Carter
Telephone: (800) 417 9255 (toll free in USA
and Canada) or +1 212 750 7999
Fax: +1 212 750 5626
E-mail: cecarter@anglogold.com
Australia
Andrea Maxey
Telephone: + 61 8 9425 4604
Fax: + 61 8 9425 4662
E-mail: amaxey@anglogold.com.au
General E-mail enquiries
investors@anglogold.com
AngloGold website
http://www.anglogold.com
Directors
Executive
R M Godsell (Chief Executive Officer)
J G Best
D L Hodgson
K H Williams
Non-Executive
R P Edey* (Chairman)
Dr T J Motlatsi (Deputy Chairman)
F B Arisman#
Mrs E le R Bradley
C B Brayshaw
A W Lea (Alternate: P G Whitcutt)
W A Nairn (Alternate: A H Calver*)
J Ogilvie Thompson (Alternate: D D Barber)
N F Oppenheimer
A J Trahar
* British #American
Offices
Registered and Corporate
Managing Secretary
Ms Y Z Simelane
Company Secretary
C R Bull
11 Diagonal Street
Johannesburg 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 4604
Fax: +61 8 9425 4662
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
Share Registrars
South Africa
Computershare Limited
Ground Floor, 70 Marshall Street
Johannesburg 2001
(PO Box 61051, Marshalltown 2107)
South Africa
Telephone: +27 11 370 7700
Fax: +27 11 688 7722
United Kingdom
Computershare Investor Services PLC
PO Box 82
The Pavilions
Bridgwater Road
Bristol BS99 7NH
England
Telephone: +44 870 702 0001
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 7010 (in Australia)
Fax: +61 8 9323 2033
ADR Depositary
The Bank of New York
101 Barclay Street
22nd Floor
New York, NY 10286
United States of America
Telephone: +1 888 269 2377
Fax: +1 212 571 3050/3052
Global BuyDIRECT SM
The Bank of New York maintains a direct
share purchase and dividend reinvestment
plan for AngloGold. For additional
information, please visit The Bank of New
York"s website at www.globalbuydirect.com
or call Shareholder Relations Department at
1-888-BNY-ADRS or write to:
The Bank of New York
Church Street Station
PO Box 11258
New York, NY 10286-1258
United States of America
Fax: +1 302 738 7210
Certain forward-looking statements
Certain statements contained in this
document including, without limitation, those concerning the economic outlook
for the gold mining industry, expectations regarding gold prices and
production, the completion and commencement of commercial operations of certain
of AngloGold"s exploration and production projects, and its liquidity and
capital resources and expenditure, contain certain forward-looking statements
regarding AngloGold"s operations, economic performance and financial condition.
Although AngloGold believes that the expectations reflected in such
forward-looking statements are reasonable, no assurance can be given that such
expectations will prove to have been correct. Accordingly, results could differ
materially from those set out in the forward-looking statements as a result of,
among other factors, changes in economic and market conditions, success of
business and operating initiatives, changes in the regulatory environment and
other government action, fluctuations in gold prices and exchange rates, and
business and operational risk management. For a discussion of such factors,
refer to the annual report on Form 20-F for the year ended 31 December 2002,
which was filed with the Securities and Exchange Commission on 7 April 2003.
Date: 31/10/2003 08:00:43 AM Supplied by www.sharenet.co.za
Produced by the JSE SENS Department
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