1 Q 3 AngloGold Ashanti Results for the third quarter ended 30 September 2010 3 Building’s safety procedure In case of an emergency... A siren will sound and information will be broadcast over the public will be broadcast over the public address system. Move quickly to the nearest exit points, which are on both sides of the auditorium and at the back right hand corner. Pl th t th k 2 Please gather at the open car park behind Turbine Hall where safety wardens will advise of any additional procedures.
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1
Q3AngloGold Ashanti Results for the third quarter ended 30 September 2010
Q3
Building’s safety procedure
In case of an emergency... A siren will sound and information
will be broadcast over the publicwill be broadcast over the publicaddress system.
Move quickly to the nearest exitpoints, which are on both sides ofthe auditorium and at the backright hand corner.
Pl th t th k
2
Please gather at the open car parkbehind Turbine Hall where safetywardens will advise of anyadditional procedures.
2
Overview – Mark Cutifani, CEO
Agenda
Tropicana – Graham Ehm, EVP Australia
South Africa – Robbie Lazare, EVP South Africa
Exploration - Tony O’Neill, EVP Business Development
3
Financials – Srinivasan Venkatakrishnan, CFO
Conclusion – Mark Cutifani, CEO
Disclaimer
Certain statements made in this communication, including, without limitation, those concerning the economic outlook forthe gold mining industry, expectations regarding gold prices, production, cash costs and other operating results, growthprospects and outlook of AngloGold Ashanti’s operations, individually or in the aggregate, including the completion andcommencement of commercial operations of certain of AngloGold Ashanti’s exploration and production projects, thecompletion of announced mergers and acquisitions transactions, AngloGold Ashanti’s liquidity and capital resources, andexpenditure and the outcome and consequences of any litigation proceedings and AngloGold Ashanti’s Project Oneperformance targets , contain certain forward-looking statements regarding AngloGold Ashanti’s operations, economic
f d fi i l diti Alth h A l G ld A h ti b li th t th t ti fl t d i h f dperformance and financial condition. 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 otherfactors, changes in economic and market conditions, success of business and operating initiatives, changes in theregulatory environment and other government actions including environmental approvals and actions, fluctuations in goldprices and exchange rates, and business and operational risk management. For a discussion of certain of these factors,refer to AngloGold Ashanti's annual report for the year ended 31 December 2009, which was distributed to shareholderson 30 March 2010. The company’s annual report on Form 20-F, was filed with the Securities and Exchange Commissionin the United States on April 19, 2010 and as amended on May 18, 2010. AngloGold Ashanti undertakes no obligation toupdate publicly or release any revisions to these forward-looking statements to reflect events or circumstances aftertoday’s date or to reflect the occurrence of unanticipated events. All subsequent written or oral forward-lookingt t t tt ib t bl t A l G ld A h ti ti it b h lf lifi d b th ti t t t
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statements attributable to AngloGold Ashanti or any person acting on its behalf are qualified by the cautionary statementsherein.
This communication contains certain “Non-GAAP” financial measures. AngloGold Ashanti utilises certain Non-GAAPperformance measures and ratios in managing its business. Non-GAAP financial measures should be viewed in additionto, and not as an alternative for, the reported operating results or cash flow from operations or any other measures ofperformance prepared in accordance with IFRS. In addition, the presentation of these measures may not be comparableto similarly titled measures other companies may use.
AngloGold Ashanti posts information that is important to investors on the main page of its website atwww.anglogoldashanti.com and under the “Investors” tab on the main page. This information is updatedregularly. Investors should visit this website to obtain important information about AngloGold Ashanti.
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Third quarter overview
A strong operational quarter…
Adjusted headline earnings* more than doubled to $303m.
Production of 1.162Moz at a total cash cost of $643/oz, ahead of guidance.
Capital raising completed; proceeds earmarked for hedge elimination.
South Africa shows strong recovery in production volumes as interventions gain traction.
Geita continues turnaround progress, delivering 15% cost reduction to $705/oz.
CC&V continues on strong recovery path.
Exploration program yields positive results in Tropicana belt, Baffin Island and Egypt.
Uranium production 389 000lbs on the back of continued improvement in recoveries; inventories of 1 39Mlbs
Uranium production 389,000lbs on the back of continued improvement in recoveries; inventories of 1.39Mlbs.
Post quarter-end…
Hedge book eliminated Oct. 7 at average $1,300/oz; gives full exposure to gold price, widens margins.
Tropicana feasibility study completed; AngloGold Ashanti’s board approves project development.
*excluding hedge buy-back costs
Safety performanceProgress being made to mitigate first-half challenges…
Three fatalities recorded in South Africa, one in Mali.
Group fatality injury frequency rateper million hours worked
0.21
All accident frequency rate 6.4% lower than 2009.
South Africa posted 1.6m fatality free shifts.
Project ONE rollout in South Africa accelerates, with emphasis on safety improvements.
All accident frequency rateper million hours worked
0.09 0.090.11
2007 2008 2009 2010YTD
6...underlying trends remain positive.
Focus on incidents related to equipment installation.
Long-term improvement in safety trend intact.
27.85
22.95
18.56 17.38
2007 2008 2009 2010YTD
4
Operational overview: Americas
ProductionQ3 2010, koz
Q3 production largely flat at 218,000oz at a total cash cost of $433/oz.
Operational cash flow $339m year-to-date.
Another strong production and cost performance…
Cerro Vanguardia continues as lowest-cost producer at $374/oz; underground feasibility scheduled for completion by year-end.
Cripple Creek & Victor output down to 56,000oz as planned after strong first-half. MLE Project yields first gold in January, a year ahead of schedule. Feasibility for MLE2/high-grade mill under way.
Operational free cash flowYTD 2010, contribution to group $m
7
Brasil Mineração output up 19% to 93,000oz at $415/oz on release of plant lock-up.
Córrego do Sítio Project on schedule.
...with growth projects running to schedule.
Operational overview: Continental AfricaGeita’s progress points to strong regional potential…
Production climbs to 373,000oz at a total cash cost of $725/oz.
Operational cash flow $318m year to date32%
ProductionQ3 2010, koz
Operational cash flow $318m year-to-date.
Navachab production up 28% on better recovered grade after DMS commissioning.
Geita’s strong trend continues as grade improves – production up 3% to 93,000oz, while total cash costs fall 15% to $705/oz.
Iduapriem production continues rebound, up 14% as tonnages recover after Q1 stoppage.
32%
Operational free cash flowYTD 2010, contribution to group $m
8…while focus is now on realising similar gains at Obuasi.
% g Q pp g
Obuasi continues to present challenges with respect to underground development; new task team appointed to increase pace for turnaround project.
5
Operational overview: Australasia
Q3 production climbs to 93,000oz at a total cash cost of $1,064/oz (includes $289/oz non-cash deferred stripping charge and ore stockpiles).
An operating region with a long-term future…
ProductionQ3 2010, koz
Output increase arises from greater proportion of higher-grade underground ore milled.
Cash flow increases year-to-date to $91m.
Project ONE rollout advanced; mining rates and productivity improving.
Long-term underground potential continues to
Operational free cash flowYTD 2010, contribution to group $m
9
g g pdevelop; feasibility study on underground sub-level cave operation planned for 2011.
Tropicana feasibility study completed; AngloGold Ashanti approves development.
...as greenfield and brownfield exploration yields more ounces.
TropicanaTropicana has developed into a tier-one asset…
Project metrics (100% basis)
Capital expenditure A$725m – A$775m (US$745-US$765 million*)
Please click below for Tropicana JV video(note that the video has no sound)
1111
Q3 production climbs to 478,000oz at a total cash cost of $594/oz.
Top operational cash flow contributor at $377m
Operational overview: South Africa
Operational improvement interventions gaining good traction…
ProductionQ3 2010, koz
Top operational cash flow contributor at $377m year-to-date.
Project ONE rollout out across operations; productivity up 13%.
Moab Khotsong production up 19% as improved safety performance boosts volumes.
TauTona production up 15% on higher yields.
Operational free cash flowYTD 2010, contribution to group $m
Surface operation production up 33% on lift from resin recoveries and Kopanang gold plant.
Savuka infrastructure on care-and-maintenance; ore body will now be accessed from Mponeng.
12…resulting in strong cash flow generation.
7
South Africa strategy
In February, we set our sites on three horizons…
Horizon Two Horizon Three1 Horizon One
Engage and fix
2
Optimise Design Future
3
Design new organisation
Value stream redesign
Optimise assets Asset integration
Technology platform roadmap
Socio-economic development plan
Engage with stakeholders
Fix production and costs
Address safety stoppages
Horizon Three
ving
s Horizon Two
13...to secure AngloGold Ashanti’s long-term future in the industry.
Cos
t sa
Time to financial realisation
Horizon One
Horizon One – Key focus areasWe focused on doing the basics right…
Horizon One
1 Horizon One
Engage and fix
Stabilise operations
& grow
Engage with stakeholders
Fix production and costs
Address safety stoppages
Development meters
Costs control
Stope face advance
14…to build the foundation for a sustained turnaround.
& grow cash flow.
Development meters
Backlog vamping
Face length availability
8
South Africa – Operational gainsFocusing on getting the basics right…
Backlog vampingkg
Focus on vamping has yielded results that can be sustained over a protracted period.
394.8 401.3
522.8
599.8
Managers are measured on their success in reclaiming gold from old mining areas.
The downward trend in stope-face advance has been reversed by getting basics right.
Focusing on seamless resourcing, specifically for the most productive 20% of work crews, is yielding early results.
Stope face advanceMetres
8.0
*quarterly averages
261.8
2008* 2009* 2010 Q1 2010 Q2 2010 Q3
15...is yielding early results in producing areas.
Project ONE scheduling and planning attributes lend themselves to improving stope-face advance.
6.6
6.8
7.0
7.2
7.4
7.6
7.8
2007 2008 2009 2010 YTD
The early focus on improving flexibility and controlling costs…
Development metersMetres (‘000)
Development has been stabilized at a higher level.
5
6
7
8
South Africa – Operational gains
Excluding project metres
Mechanized techniques used in project areas now being employed in some conventional production areas.
All operations besides Kopanang are ahead of budget on development.
P d ti i i t t i t lli
ORD SIBC WC Waste WC Reef Planned
0
1
2
3
4
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep Oct
Nov
Dec
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sep Oct
Nov
Dec
2009 2010
Total cash costR/kg
16...is paying dividends.
Production gains important in controlling unit costs.
Costs in South Africa now under control.
R/kg
151,186
135,419139,350
Q1 2010 Q2 2010 Q3 2010(Incl. labour increase/winter power tariffs)
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South Africa – Project ONE case studyThe impact of Project ONE has been felt in the plant…Mponeng – Leach cyanide concentration South Africa – Mponeng – Daily stoping m2 – 2010
1,000
1,200
1,400
1,600
200
250
South Africa – Daily cyanide consumption (g/t)
April Jun Jul Sep Oct NovMay
400
600
800
200
0
Project ONE rolled out across all South Africa operations.
April May Jun Jul Aug Oct
150
100
50
2010
450
500
17…and has seen a promising start in the mines.
p
Early results encouraging in underground mining areas.
Project ONE team support to ensure improvements are sustained.
May Jun Jul Aug Sep Oct
150
200
250
300
350
400
450
2010
South Africa – The results so farOur operating interventions result in real benefits…
Gold production and cash flowKg and Rand
14 85914000
16000
1200
1400
Gol
d pr
oduc
tion C
ash flow
13,91914,859
11,949
4000
6000
8000
10000
12000
14000
400
600
800
1000
1200
18...and will be made sustainable with Project ONE design.
0
2000
4000
Q1 2010 Q2 2010 Q3 2010
0
200
Production Cash flow
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Exploration pipelineWe’re moving our key prospects through the pipeline...
Pathway to value – Concept to resource definition
Create the value platform Crystallise the value
Havana DeepsBoston Shaker
Tumbleweed, Black Dragon, Dragonfly Tropicana Region
La Colosa Regional, Salvajina, Quebradona, Rio Dulce
Vulu, Tango
Malrok, Kanosak
L Mb li
Mase / Kele JV
Baffin Island
Ndj l
Superior JV
New Georgia JVSolomon Islands
Colombia Regional
HutiteHodineEgypt
Me angGabon Regional
Arctic Canada
19...to add ounce to inventory and ultimately, to the production profile.
Exploration focus – Australia and South East Asia We have the 600km Tropicana belt nailed down…
Dominant 24,000km2 position in Tropicana belt along 600km strike. Strong initial results at Havana Deeps includes 13m @ 6.11g/t from 417m; at Boston Shaker 22m @ 4.38g/t from 247m.
Saxby JV in Queensland shows early promise
Applied for 13,780km2 of copper and gold mineralisation south of Telfer.
Solomon Island position of 1,900km2 across West Georgia and Vanguna islands, targeting epithermal and copper-gold porphry mineralisation; promising early results include [email protected]/t true width and 3m @ 10.2g/t trench.
20
Hutite deposit in Egypt returns encouraging gold showings from pre-WWII mine site.
Gabon exploration team has collected 15,000 soil samples and has commenced drilling at Lamboumi Central project.
...now looking for new frontiers in Australia and Solomon Islands.
11
Exploration focus – Africa and Americas Colombia is the cornerstone of our Americas effort…
Greenfields exploration drilling increased 19% to 98,000m during the quarter., g q
La Colosa drilling resumed following hiatus.
La Colosa initial drilling returns intercepts of 74m@ 1.9g/t and [email protected]/t. in Hornfels-style mineralisation. Further investigation underway.
Kanosak in Baffin Island returned promising grades, including:
– 9m @ 2.26g/t Au in the upper strata.
21...with interesting initial results from the Arctic.
– 1m @ 22.5g/t Au a vein in the deeper layer assaying.
Financial results for the quarter Production and costs ahead of guidance...
Gold production up 3% to 1.162Moz; 1% ahead of guidance.
Gold price discount of 6 9% for received* price of $1 141/oz; better than guidance of 8% to 10% Gold price discount of 6.9% for received price of $1,141/oz; better than guidance of 8% to 10%.
Total cash costs of $643/oz; $2/oz better than guidance despite negative currency impact of $15/oz.