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ANGLOGOLD ASHANTI LIMITED - AngloGold Ashanti Says First-Half Costs, Earnings, Cash Flow Improve

Release Date: 20/08/2018 07:07
Code(s): ANG ANG013     PDF:  
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AngloGold Ashanti Says First-Half Costs, Earnings, Cash Flow Improve

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”)

20 August 2018


AngloGold Ashanti Says First-Half Costs, Earnings, Cash Flow Improve

(PRESS RELEASE) – AngloGold Ashanti said today that a strong production and cost
performance in the first half of this year, as inward investment started to bear fruit, helped
deliver a strong earnings result and allowed the Company to forecast production for 2018 at
the top end of its guided range, and costs at the bottom end.

The Company continued to deliver on its strategy to improve free cash flow and returns by
focusing on improving margins and reinvesting in high-return projects in its existing portfolio.
Productivity rates, up 58% since 2012, continued to improve as the effects of portfolio
restructuring became evident, the brownfields investments started to yield returns, and its
operational efficiency initiatives gained traction.

“We continued to improve our portfolio, strengthen our balance sheet and increase
productivity, all of which are the cornerstones of our strategy to improve free cash flow and
returns over the long term,” outgoing Chief Executive Officer Srinivasan Venkatakrishnan said.
“The business is in good shape - production is strong, costs are improving and our pipeline is
well stocked with options.”

On 1 September 2018, Kelvin Dushnisky, the current President of Barrick Gold Corporation,
will assume the CEO role at the Company.

Adjusted headline earnings were $85m, or 21 US Dollar cents per share, for the first six
months of 2018 versus a loss of $93m, or 23 US Dollar cents per share in the first half of 2017.
Increases in adjusted headline earnings were due mainly to the improved operating
performance and the higher gold price.

Free cash flow improved by $110m to an outflow of $51m in the first six months of 2018 versus
an outflow of $161m in the first six months of last year. Positive free cash flow of $19m was
recorded during the second quarter of 2018.
The Company’s balance sheet also continued to improve, with debt falling, ample liquidity of
around $2 billion, and no near-dated bond maturities. Net debt declined by 17% year-on-year
to $1.786bn at 30 June 2018, from $2.151bn at the same time last year. The ratio of Net debt
to Adjusted EBITDA at 30 June 2018 was 1.12 times, compared to 1.56 times at 30 June
2017, well below the covenant ratio of 3.5 times which applies under the revolving credit

Operating Performance

Total production for the group, including those operations either sold earlier this year or closed
during 2017, was 1.629Moz at a total cash cost of $823/oz for the six months ended 30 June
2018, compared to 1.748Moz at a total cash cost of $796/oz in the first six months of 2017.
All-in sustaining costs (AISC) for this set of assets fell 5% to $1,020/oz, versus $1,071/oz in
the first half of 2017.

The International Operations posted another strong performance, achieving a 4% year-on-
year reduction in AISC to $948/oz during the first half of 2018, from $988/oz during the first
half of 2017. This was alongside a 4% increase in production to 1.372Moz, from 1.313Moz.

The sale of the Vaal River underground mines was completed at the end of February 2018,
and the proceeds were immediately applied to reduce debt and further improve balance sheet
flexibility. Brownfields projects remained on track and on budget. The ratification of investment
agreements by Ghana’s Parliament in June 2018 allows for the redevelopment of the high-
grade Obuasi Gold Mine to commence in earnest.

Safety Performance

It is with great sadness that we report three fatalities in the first half of 2018. The South Africa
region suffered two fatal accidents. At Moab Khotsong a tramming accident caused one fatality
and at Mponeng a mechanical loader operator was fatally injured in a seismic fall of ground.
In Brazil there was one fatality following an electricity-related incident. AngloGold Ashanti
remains committed to establishing and adhering to the best safety practices in the industry.
The group’s All-Injury Frequency Rate, the broadest measure of workplace safety, was 5.6
injuries per million hours worked for the six months ended 30 June 2018, down 31% from the
first half of last year and was the lowest level in the Company’s history.



JSE Sponsor: Deutsche Securities (SA) Proprietary Limited



Chris Nthite                    +27 11 637 6388/+27 83 301 2481

Stewart Bailey                   +27 81 032 2563 / +27 11 637 6031

General inquiries                                           

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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 and forecasts 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 report on Form 20-F for the year ended 31 December 2017, which was filed with the United States
Securities and Exchange Commission (“SEC”). 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.
The financial information contained in this news release has not been reviewed or reported on by the Company’s external auditors.

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 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.



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