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ANGLOGOLD ASHANTI LIMITED - AngloGold Posts Strong Q1 Cost, Production Performance; Net Debt Falls

Release Date: 08/05/2018 07:06
Code(s): ANG ANG013     PDF:  
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AngloGold Posts Strong Q1 Cost, Production Performance; Net Debt Falls

AngloGold Ashanti Limited
(Incorporated in the Republic of South Africa)
Reg. No. 1944/017354/06
ISIN. ZAE000043485 – JSE share code: ANG
CUSIP: 035128206 – NYSE share code: AU
JSE Bond Company Code - BIANG
(“AngloGold Ashanti” or the “Company”)


8 May 2018

NEWS RELEASE

AngloGold Posts Strong Q1 Cost, Production Performance; Net Debt Falls

(JOHANNESBURG – PRESS RELEASE) – AngloGold Ashanti posted a strong first-quarter
performance, with lower debt and improvements in both production and all-in sustaining
costs, driving wider margins and stronger cash flows. The Australian operations were the
standout performers.

Production of 824,000oz at all-in sustaining cost of $1,029/oz in the three months through 31
March, compared with 830,000oz at AISC of $1,060/oz in the first quarter of last year.
Production was little changed despite TauTona undergoing orderly closure and the sales of
Moab Khotsong and Kopanang concluding a month before the end of the quarter. Looking
only at retained operations (operations excluding closed and sold operations), production
rose 6% to 773,000oz at an AISC of $1,002/oz, representing a margin of 25% to the gold
price received for the period.

“Our hard work in restructuring the business to focus on portfolio quality is starting to bear
fruit as our operations are demonstrating strong, consistent results,” Chief Executive
Officer Srinivasan Venkatakrishnan, said. “The core portfolio is performing well, the
balance sheet is solid, our projects are on schedule and we see good potential for further
efficiencies in both our International and South African Operations.”

AngloGold Ashanti has restructured its portfolio to focus on higher-margin, longer-life assets,
while investing in a series of brownfield projects with strong return profiles. The company
has focused on tight cost control and disciplined capital allocation across its portfolio, which
now has about 87% of production from its International Operations.
With roughly a quarter of the full year’s guided production delivered in the seasonally weak
first quarter, AngloGold Ashanti remains on track to meet its annual production, cost and
capital guidance.

Production at the International Operations increased 5% year-on-year to 666,000oz, with
AISC improving further to $950/oz from $963/oz in the first quarter of last year, as the
continued focus on operating efficiencies gains momentum. Standout performers include
Sunrise Dam in Australia which recorded a 54% increase in production, and Tropicana,
Kibali, Iduapriem and Serra Grande.

In South Africa, the smaller and more focused footprint delivered an encouraging
performance as production from Mponeng increased 29%, while rand-denominated all-in
sustaining costs fell 14%. Restructuring of the asset portfolio in South Africa is still underway
to ensure that both the on- and off-mine cost structures are appropriate for the size of the
smaller production base in the country.

BALANCE SHEET
Cash generation from retained operations remained strong despite the smaller asset base,
with adjusted earnings before interest, tax, depreciation and amortisation (adjusted EBITDA)
rising 21%, from $316m to $382m.

The Company further improved its balance sheet after applying asset-sale proceeds to
reduce South Africa debt. Net Debt to adjusted EBITDA improved to 1.14 times, down from
1.35 times at the end of 2017. Net Debt at 31 March was $1.77bn, compared with $2.05bn
at the end of March last year.


SAFETY UPDATE
Regrettably, two fatalities were recorded during the quarter. South Africa region suffered
one fatality following a tramming accident at Moab Khotsong, and an electricity-related
fatality occurred in Brazil. These incidents are a reminder of the importance of adhering to
our safety standards.

The group All-Injury Frequency Rate, the broadest measure of workplace safety, was 6.35
injuries per million hours worked for the period, down 28% from the first quarter of last year
demonstrating improvement for the fourth consecutive quarter. Sadiola and Geita passed the
quarter without a single injury, demonstrating the potential possible when there is strong
oversight and compliance to world-class standards.

Despite these setbacks, the Company remains focused on this critical area of our business
and concerted efforts are underway to not only understand the cause of each of these
incidents, but also the root cause of other high potential incidents that could have resulted in
fatalities.

Outlook*
Full- year guidance remains unchanged as follows:

     -      Production is estimated to be between 3.325Moz and 3.450Moz;
     -      Total cash costs are between $770/oz and $830/oz; and
     -      AISC between $990/oz and $1,060/oz, assuming average exchange rates against
            the US dollar of 12.79ZAR (Rand), 3.20BRL (Brazil Real), 0.78AUD (Aus$) and
            19.61ARS (Argentina Peso), with the Brent Crude oil price at $62/bbl average for the
            year. Capital expenditure is anticipated to be between $800m and $920m.

ENDS
Johannesburg

JSE Sponsor: Deutsche Securities (SA) Proprietary Limited

 * Both production and cost estimates assume no labour or other interruptions, or changes to asset portfolio and/or operating mines and have not been reviewed by
 our external auditors. Other unknown or unpredictable factors could also have material adverse effects on our future results and no assurance can be given that any
 expectations expressed by AngloGold Ashanti will prove to have been correct. Please r e fe r to the Risk Factors section in AngloGold Ashanti’s annual report
 on Form 20-F for the year ended31 December 2017, filed with the United States Securities and Exchange Commission.




CONTACTS
Media

Chris Nthite                                                +27 11 637 6388/+27 83 301 2481                                cnthite@anglogoldashanti.com

Stewart Bailey                                              +27 81 032 2563 / +27 11 637 6031                              sbailey@anglogoldashanti.com

General inquiries                                                                                                           media@anglogoldashanti.com

Investors

Stewart Bailey                                              +27 81 032 2563 / +27 11 637 6031                              sbailey@anglogoldashanti.com

Sabrina Brockman                                            +1 646 880 4526/ +1 646 379 2555                              sbrockman@anglogoldashanti.com

Fundisa Mgidi                                               +27 11 6376763 / +27 82 821 5322                                fmgidi@anglogoldashanti.com


Certain statements contained in this document, other than statements of historical fact, including, without limitation, those concerning the economic outlook for the gold mining
industry, expectations regarding gold prices, production, total cash costs, all-in sustaining costs, all-in costs, cost savings and other operating results, productivity improvements,
growth prospects and outlook of AngloGold Ashanti’s operations, individually or in the aggregate, including the achievement of project milestones, commencement and completion
of commercial operations of certain of AngloGold Ashanti’s exploration and production projects and the completion of acquisitions, dispositions or joint venture transactions,
AngloGold Ashanti’s liquidity and capital resources and capital expenditures and the outcome and consequence of any potential or pending litigation or regulatory proceedings or
environmental health and safety issues, are forward-looking statements regarding AngloGold Ashanti’s operations, economic performance and financial condition. These forward-
looking statements or forecasts involve known and unknown risks, uncertainties and other factors that may cause AngloGold Ashanti’s actual results, performance or
achievements to differ materially from the anticipated results, performance or achievements expressed or implied in these forward-looking statements. Although AngloGold
Ashanti believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been
correct. Accordingly, results could differ materially from those set out in the forward-looking statements as a result of, among other factors, changes in economic, social and
political and market conditions, the success of business and operating initiatives, changes in the regulatory environment and other government actions, including environmental
approvals, fluctuations in gold prices and exchange rates, the outcome of pending or future litigation proceedings, and business and operational risk management. For a discussion
of such risk factors, refer to AngloGold Ashanti’s annual reports on Form 20-F filed with the United States Securities and Exchange Commission. These factors are not necessarily
all of the important factors that could cause AngloGold Ashanti’s actual results to differ materially from those expressed in any forward-looking statements. Other unknown or
unpredictable factors could also have material adverse effects on future results. Consequently, readers are cautioned not to place undue reliance on forward-looking statements.
AngloGold Ashanti undertakes no obligation to update publicly or release any revisions to these forward-looking statements to reflect events or circumstances after the date
hereof or to reflect the occurrence of unanticipated events, except to the extent required by applicable law. All subsequent written or oral forward-looking statements attributable
to AngloGold Ashanti or any person acting on its behalf are qualified by the cautionary statements herein.

Non-GAAP financial measures
This communication may contain certain “Non-GAAP” financial measures. AngloGold Ashanti utilises certain Non-GAAP performance measures and ratios in managing
its business. Non- GAAP financial measures should be viewed in addition to, and not as an alternative for, the reported operating results or cash flow from operations or
any other measures of performance prepared in accordance with IFRS. In addition, the presentation of these measures may not be comparable to similarly titled measures
other companies may use. AngloGold Ashanti posts information that is important to investors on the main page of its website at www.anglogoldashanti.com and under
the “Investors” tab on the main page. This information is updated regularly. Investors should visit this website to obtain important information about AngloGold Ashanti.

Website: www.anglogoldashanti.com

Date: 08/05/2018 07:06:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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