REG-Anglogold Ld: Report for the quarter & nine months ended 30.09.09
Report to shareholders
for the quarter and nine months ended 30 September 2009
Group results for the quarter….
Adjusted headlines earnings, normalised to exclude hedge buybacks, at $163m.
Gold production rises 5% to 1.187Moz, following fewer safety interruptions.
Uranium production rises 10% to 366,000 pounds.
Total cash costs of $534/oz provide solid operating margin despite sharply
stronger operating currencies.
Vaal River operations improve following management intervention.
Geita and Ghana operations continue to deliver on turnaround strategy.
South America delivers 9% growth in production, limits cost increases, despite
currency strength.
Major hedge restructuring completed before recent gold price rally; committed
ounces now less than annual production at 4.3Moz.
Events post quarter-end….
Annual guidance reviewed to 4.55Moz - 4.6Moz to factor in lower South African
production, following shaft incident at TauTona.
Joint venture formed with De Beers to explore for marine gold deposits.
Acquisition concluded for the purchase of 35% stake in Moto Gold Project.
Quarter Nine months Quarter Nine months
ended ended ended ended ended ended ended ended
Sep Jun Sep Sep Sep Jun Sep Sep
2009 2009 2009 2008 2009 2009 2009 2008
SA rand / Metric US dollar / Imperial
Operating
review
Gold
Produced - kg / oz(000) 36,925 35,050 106,282 115,530 1,187 1,127 3,417 3,714
Price
received - R/kg / $/oz 61,095 241,505 185,498 100,660 261 897 653 416
Price
received
excluding
hedge
buyback
costs - R/kg / $/oz 225,388 241,505 245,364 174,646 906 897 888 707
Total cash
costs - R/kg / $/oz 133,274 127,956 134,192 111,540 534 472 485 451
Total
production
costs - R/kg / $/oz 166,355 161,909 169,536 142,586 667 598 612 576
Financial
review
Gross (loss)
profit - Rm / $m (8,872) 3,051 (4,718) (1,248) (1,116) 387 (618) 204
Gross (loss)
profit
adjusted for
the (loss)
gain on
unrealised
non-hedge
derivatives
and other
commodity
contracts - Rm / $m (4,110) 2,511 1,165 (4,187) (510) 305 74 (509)
Adjusted
gross profit
excluding
hedge
buyback
costs - Rm / $m 2,205 2,511 7,480 3,831 287 305 871 501
(Loss)
profit
attributable
to equity
shareholders - Rm / $m (8,245) 2,304 (5,940) (4,236) (1,042) 299 (743) (179)
Headline
(loss)
earnings - Rm / $m (8,068) 1,631 (6,437) (4,891) (1,018) 215 (803) (263)
Headline
(loss)
earnings
adjusted for
the (loss)
gain on
unrealised
non-hedge
derivatives
and other
commodity
contracts
and fair
value
adjustments
on
convertible
bond - Rm / $m (4,757) 1,359 (1,917) (7,019) (596) 167 (279) (880)
Capital
expenditure - Rm / $m 1,842 2,228 6,451 6,911 232 261 734 899
(Loss)
profit per
ordinary
share - cents/share
Basic (2,286) 642 (1,653) (1,393) (289) 83 (207) (59)
Diluted (2,286) 641 (1,653) (1,393) (289) 83 (207) (59)
Headline (2,237) 455 (1,791) (1,609) (282) 60 (223) (87)
Headline
(loss)
earnings
adjusted for
the (loss)
gain on
unrealised
non-hedge
derivatives
and other
commodity
contracts
and fair
value
adjustments
on
convertible
bond - cents/share (1,319) 379 (533) (2,309) (165) 47 (78) (289)
$ represents US dollar, unless Rounding of figures may result in
otherwise stated. computational discrepancies.
Operations at a glance
for the quarter ended 30 September 2009
Adjusted gross
profit (loss)
excluding hedge
Production Total cash costs buyback costs
% % $m
oz (000) Variance 1 $/oz Variance 1 $m Variance 1
SOUTHERN AFRICA 483 7 525 18 118 (25)
South Africa
Great Noligwa 42 8 916 29 (7) (6)
Kopanang 92 39 442 (1) 27 12
Moab Khotsong 62 32 478 10 8 3
Tau Lekoa 31 11 797 6 3 -
Surface Operations 40 (5) 406 27 21 (3)
Mponeng 125 (11) 375 23 60 (19)
Savuka 1 (92) 9,847 1,342 (11) (11)
TauTona 74 21 501 14 15 (2)
Namibia
Navachab 16 23 615 (15) 3 1
CONTINENTAL AFRICA 391 1 615 9 82 4
Ghana
Iduapriem 52 11 493 (7) 16 1
Obuasi 92 (9) 671 14 8 (2)
Guinea
Siguiri - Attributable 85% 79 (1) 500 11 26 11
Mali
Morila - Attributable 40% 2 32 (6) 559 9 11 (2)
Sadiola - Attributable 38% 2 32 (9) 532 9 10 (6)
Yatela - Attributable 40% 2 22 (12) 219 (43) 14 1
Tanzania
Geita 83 32 883 1 (8) -
Minorities, exploration and other 5 1
AUSTRALIA 102 9 655 28 11 (17)
Sunrise Dam 102 9 647 29 12 (17)
Exploration and other (1) -
SOUTH AMERICA 157 9 349 7 87 20
Argentina
Cerro Vanguardia - Attributable 92.50% 47 (8) 336 (2) 29 11
Brazil
AngloGold Ashanti Brasil Mineração 90 23 333 16 41 6
Serra Grande - Attributable 50% 20 - 445 9 7 -
Minorities, exploration and other 10 3
NORTH AMERICA 54 4 406 12 21 (2)
United States
Cripple Creek & Victor 54 4 394 12 22 (2)
Other (1) -
OTHER 2 (6)
Sub-total 1,187 5 534 13 321 (26)
Less equity accounted investments (35) 7
AngloGold Ashanti 287 (18)
1 Variance September 2009 quarter on June 2009 quarter - increase (decrease).
2 Equity accounted investments.
Rounding of figures may result in computational discrepancies.
Financial and Operating Report
OVERVIEW FOR THE QUARTER
SAFETY
Safety remained AngloGold Ashanti's highest priority, with management's efforts
focused on recovering from a poor performance in the second quarter. Four
miners tragically lost their lives during the quarter in two separate accidents
at Mponeng and one each at TauTona and Great Noligwa. The rigorous
implementation of existing safety protocols and targeted interventions at the
Vaal River operations helped lower the number of fatalities by half. However,
much work still needs to be done to eliminate these accidents altogether. The
12% decline in the lost time injury frequency rate in the first nine months of
this year is an encouraging achievement and testament to our drive toward
continued improvements to safety on our operations.
The strategy of analysing and providing intensive support to teams with the
poorest safety performance on the company's South African operations is
continuing. In addition to this short-term intervention, AngloGold Ashanti
remains committed to the implementation early next year of its Safety
Transformation blueprint, which is aimed at achieving the next quantum
improvement in safety performance. Sadiola, Yatela, Geita and Navachab reported
no lost-time injuries during the quarter.
Thirty full and eighteen partial production shifts were lost at the company's
South African mines during the quarter due to safety related stoppages.
Government inspectors and AngloGold Ashanti's mine managers continue to apply
safety regulations more aggressively than in the past, with a commensurate
impact on gold production. Post quarter-end, AngloGold Ashanti's management
initiated a stoppage at TauTona to conduct a shaft inspection after a length of
steel fell down a shaft at the mine. A decision was subsequently taken to
suspend all operations at the mine pending a thorough inspection of all
steelwork along the full length of the shaft systems, to prevent a recurrence
of this incident. TauTona could potentially be closed until the end of this
year while this remedial action is completed. The impact of this interruption
will affect full-year production and has resulted in a revision of our annual
guidance.
OPERATING REVIEW
Production rose 5% from the previous quarter to 1.187Moz, broadly in line with
the guidance of 1.2Moz. Total cash costs rose 13% to $534/oz. Given the
average exchange rate of R7.77/$, this is within AngloGold Ashanti's quarterly
guidance issued in July.
Stronger operating currencies in key regions continued to erode the benefit of
a stronger bullion price. The Brazilian real gained 10% on average against the
US dollar during the quarter compared with a 9% strengthening in both the
Australian dollar and South African rand. This lowered the gold price in those
currencies and pushed dollar-denominated costs higher, placing pressure on
operating margins.
The third quarter also saw winter power tariffs compounded by the introduction
of a 31.3% annual power-price increase in South Africa. Eskom Holdings Limited,
the state-owned utility, has announced that it will petition the National
Energy Regulator to raise prices annually by a further 45% until 2012 to fund
the construction of new power generation capacity. Should Eskom's request be
granted, pressure will be placed on the cost structure of AngloGold Ashanti's
South African operations which currently account for 40% of annual production.
Southern African operations produced 483,000oz in the three months ending
September at a total cash cost of $525/oz, compared with 450,000oz at $444/oz
in the previous quarter. Fewer safety stoppages helped increase production from
the Vaal River region. Costs were impacted by the higher electricity prices,
the stronger rand and the introduction of higher labour costs following the
wage settlement reached during the previous quarter. Among the West Wits
operations, Mponeng's output declined after stoppages related to the two
accidents at the mine, while Savuka's production was halted as work continued
to repair underground infrastructure damaged by the seismic event that occurred
in May.
Continental Africa's production was largely unchanged at 391,000oz, while total
cash costs rose 9% to $615/oz. The operational turnaround at Geita continued
under the new management team where production increased by 32%, mainly as a
result of higher grades. Costs at the operation were in line with the planned
increase in fleet maintenance and the initial costs related to the rollout of
AngloGold Ashanti's business improvement initiatives.
In Ghana, operational improvements continued with Iduapriem registering an 11%
increase in gold production after last quarter's mill maintenance. Improved
grade management at Obuasi limited the production decline caused by heavy rains
and flooding, to 9%. Lower grades at Sadiola and fewer tons processed at
Yatela, lowered production from Mali, which was in line with mine plans.
The South American operations continued to build on their turnaround success of
the past year. Production rose by 9% to 157,000oz at a total cash cost of $349/
oz. In Argentina, Cerro Vanguardia mitigated the impact of a planned drop in
gold production with higher realised prices for its silver by-product. Higher
tonnes treated and improved grades helped boost output at AngloGold Ashanti
Brasil Mineração.
In the United States, Cripple Creek & Victor reported a 4% increase in
production due to pad phase timing while total costs rose 12%. In Australia,
production rose by 9% from the previous quarter due to increased tonnage and
yield.
FINANCIAL AND CORPORATE REVIEW
Adjusted headline earnings, excluding the cost of the hedge buybacks concluded
during the quarter, were US$163m, which was broadly in line with last quarter's
record adjusted headline earnings of $167m. The adjusted headline loss for the
quarter, after taking into account the cost of the hedge buybacks, was $596m,
or 165 US cents per share.
The realised gold price for the quarter was $261/oz, following the
restructuring of the hedge book which was done at a cost of $797m. The realised
price would have been $906/oz, a 6% discount to the average spot price for the
period, were it not for this cost. Management has targeted an average 7%
discount to spot gold prices over the remainder of the life of the hedge book
at a gold price of $950/oz in real terms and assumed production profile of 5Moz
a year.
The accelerated buyback of certain gold derivative positions, along with normal
deliveries into contracts, reduced the total committed ounces in the hedge book
to 4.3Moz at the end of the quarter, from 5.19Moz at the end of June and is
expected to reach 4.1Moz at year end. Thereafter, the hedge book is expected to
diminish by about 800,000oz per year through to 2014, by which time it will be
largely depleted. Following the recent buybacks, the fair value of the entire
hedge book is now included in the financial statements.
During the quarter, AngloGold Ashanti raised equity, to fund its 50% stake in
Moto Goldmines Limited. This share sale was part of the company's strategy to
pay for a large gold resource with long-term development potential, with
longer-term financing, while maintaining balance-sheet flexibility.
EXPLORATION
Total exploration spending during the quarter was $55m, an increase of 28% over
the previous quarter. Expenditure increased in Colombia, where activity is
gearing up in anticipation of the conclusion of public appeals related to
exploration permits awarded during the previous quarter. Regional exploration
in Canada and Australia, as well as the initiation of the feasibility study on
the Tropicana project also contributed to the increase in spending. Subsequent
to the end of the third quarter, AngloGold Ashanti concluded an agreement to
cooperate with De Beers, one of the world's largest marine miners, in the
search for gold ore bodies on the ocean floor.
OUTLOOK
AngloGold Ashanti has revised its annual guidance to 4.55 to 4.6Moz, reflecting
the lower South African production. Full-year 2009 total cash costs are
expected to be between $515/oz and $530/oz assuming an average exchange rate of
between R7.00/$ and R7.50/$ during the fourth quarter. Production in the fourth
quarter is estimated at 1.160Moz at a total cash cost of $590/oz assuming an
exchange rate of R7.50/$.
Fourth quarter adjusted headline earnings could be, as in previous years,
distorted by year-end accounting adjustments (these could include amongst
others, the reassessment of asset useful lives, rehabilitation, current and
deferred tax and inventory provisions).
Notes:
All references to price received includes realised non-hedge derivatives.
In the case of joint venture and operations with minority holdings, all
production and financial results are attributable to AngloGold Ashanti.
Rounding of figures may result in computational discrepancies.
Review of the Gold Market
Gold price movement and investment markets
Gold price data
The third quarter continued the trend of strong gold prices experienced
throughout the year, averaging $959/oz, or 4% higher than the average for the
prior three-month period. Gold traded above the psychological $1,000/oz level
for seven consecutive days and averaged $997/oz for the final month of the
quarter.
Bullion's fortunes once again closely tracked those of the US dollar, with both
range bound during the period. This is a typical feature of financial markets
during the third quarter due to the summer holiday period in North America and
Europe. However, the general theme of accumulation of risk assets continued
through this quiet period as global stock markets continued their rally.
During July and August, investment demand as demonstrated by major ETF holdings
saw a net sale of 0.77Moz. The COMEX position was stable at around 21Moz net
long for the same period. This all changed abruptly at the beginning of
September, however, with a $50/oz rally despite little change in the US dollar.
The surge attracted a flurry of speculative investors as the COMEX net long
position leapt to an unprecedented level of 29Moz, eclipsing the previous
record of 27Moz. The subsequent increase to 31Moz helped sustain the period of
successive closes above $1,000/oz.
The quarter concluded with another G20 meeting. The statement from the
Pittsburgh meeting was reassuring as delegates concluded that recovery efforts
of various governments are proving effective and that recovery has taken hold.
The market, however, requires clarity on how governments are planning to
neutralize liquidity provided through various quantitative easing programmes.
Until there is clarity, confidence will remain fragile.
Official sector activity
The third Central Bank Agreement, signed on 7 August, was implemented on 27
September and stipulated a reduced annual sales quota from 500 to 400 tonnes a
year. Analysts are sceptical that the full allotment will be sold given that
1,883 tonnes were sold under the second agreement, which is 117 tonnes less
than the volume sold under the first agreement.
The IMF Executive Board in September approved the sale of 403 tonnes of gold,
which it had initially flagged to the market in the first quarter of this year.
The IMF is not a signatory to the third Central Bank agreement, but has
stressed that the sale will not disrupt the market. It would not be surprising
to see an off-market transaction concluded as part of the process.
Producer hedging
Gold producers were once again actively de-hedging during the quarter. After
AngloGold Ashanti announced its own restructuring programme at the end of July,
Gold Fields unwound the royalty agreement on its Australian operation in early
September. In the same month, Barrick announced its intention to unwind its
project sales hedge book.
Currencies
The Rand continued to strengthen against the US dollar particularly during
September. The strength coincided with the increase in the price of gold and
other commodity producing currencies and heightened optimism of a major
telecommunications deal and the resulting inflow of hard currency to South
Africa. The Rand strengthened on average by 8% against the US dollar over the
quarter, but gave up some of these gains when talks around the mobile phone
deal were abandoned.
The Australian dollar averaged 8% stronger against the dollar over this quarter
on the back of higher gold and commodity prices, but also as a consequence of
the effective manner in which the Australian government is perceived to have
managed its economy throughout the financial crisis. Swift action in cutting
interest rates at the start of the crisis has seen Australia weather the storm
relatively well and the outlook for its economy looks robust.
The Brazilian real has been one of the best performing emerging market
currencies against the US dollar, strengthening 24% since the start of the
year. In the quarter under review, it strengthened 10%.
Physical demand
Jewellery sales
Almost all of the world's key markets for physical gold continue to be
depressed by the effects of the global financial crisis. China is the only
major market to buck the trend.
India's gold market remains under pressure after 20% gains over the past year
in the Rupee-denominated gold price. Between June and September, gold jewellery
consumption fell 22% compared with the same period a year earlier. Spurred by
the financial crisis, urban consumers are entrusting cash to bank deposits,
which are up 32% over 2008 levels. News is somewhat more positive in most rural
areas where gold demand remains relatively stable and in some regions shows
modest growth. Thus far, scrap activity during the third quarter has been
slight as the market appears to be anticipating further gold price increases.
The impact of the global recession on China's gold market remains milder than
in all other major economies. Domestic consumption is resilient and the
psychological reaction to the crisis remains markedly more bullish than in
other markets. Demand for traditional 24 carat gold jewellery continues to grow
year on year, albeit it at a modest level while offtake of 18 carat gold
jewellery remains flat. This shows the investment case for pure gold jewellery
continues to hold sway with the Chinese consumer.
The US gold jewellery market has continued its quarter-on-quarter decline as
jewellery still leads the list of discretionary spend items to be cut during
the recession. Primary value gold jewellery sales in the first half were down
12% year-on-year. While the rate of decline is decreasing, the second half of
last year was particularly weak as the crisis unfolded in the US. Major players
through the retail value chain continue to close outlets or file for bankruptcy
protection. Closures and forced consolidation may help the jewellery industry
recover more quickly and remain stronger once the recession ends.
The jewellery sector in the Middle East remains under pressure in the third
quarter. Egypt, which had been bucking negative trends in the first half of the
year saw an 8-10% decrease in third-quarter jewellery sales compared with a
particularly strong quarter a year earlier. Matters are worse in the Kingdom of
Saudi Arabia (KSA) with a 25-30% drop in demand in the third quarter. Gold
price volatility caused consumers who tend to time their purchases on their
view of the price, to delay purchases. In the United Arab Emirates, an
anticipated third quarter recovery did not materialise with jewellery tonnage
down 20-23%. With its heavy reliance on tourism and local expatriate
consumption, the UAE continues to bear the full brunt of the financial crisis
in the Middle East. The gold market in Turkey shows a glimmer of hope with
exchange rates stabilizing and the stock market posting gains.
Investment market
The negative data on gold jewellery consumption have been mitigated somewhat by
further good news on investment demand. Global investment activity for gold
remains strong and the market has stayed buoyant despite rising prices. In
India, investment purchases are on the rise in major cities, while in the
Middle East bar and coin sales in the gulf, excluding UAE and KSA, are up 7%.
In Turkey, new-coin minting is up to 11 tonnes in July and August and the third
quarter will show growth quarter on quarter, though levels will not match those
of the same period last year. The US market continues to experience robust
investment demand with bar, coin and ETF demand still rising.
Hedge position
As at 30 September 2009, the net delta hedge position was 3.93Moz or 122t (at
30 June 2009: 4.41Moz or 137t), representing a further reduction of 0.48Moz for
the quarter. The total commitments of the hedge book as at 30 September 2009
was 4.3Moz or 134t, a reduction of 0.89Moz from the position as at 30 June
2009.
The marked-to-market value of all hedge transactions making up the hedge
positions was a negative $1.84bn (negative R13.83bn), decreasing by $0.47bn
(R4.01bn) over the quarter. This value was based on a gold price of $1,006/oz,
exchange rates of R7.51/$ and A$/$0.88 and the prevailing market interest rates
and volatilities at that date.
As at 28 October 2009, the marked-to-market value of the hedge book was a
negative $1.94bn (negative R15bn), based on a gold price of $1,036.80/oz and
exchange rates of R7.73/$ and A$/$0.91 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, nor of future impact on the revenue of the company. The
valuation represents the theoretical cost of buying all hedge contracts at the
time of valuation, at market prices and rates available at the time.
During the quarter, deals to the value of $797m were accelerated and closed out
in July 2009 which included deals that were designated as normal sale exempted
and previously held off balance sheet. Of these, $580m was cash settled and a
further $217m was also incurred in accelerating the cash settlement of existing
non-hedge derivative contracts. The cash settlement of the former resulted in
the remaining normal sale exempted designated contracts having to be
re-designated as non-hedge derivatives and recorded on the balance sheet at
fair value with changes in fair value accounted for in the income statement.
During July 2009 the impact of the related re-designation of normal sales
exempted contracts after the buyback of $797m on the financial statements is an
increase in non-hedge derivative liabilities of $558m.
The following table indicates the group's commodity hedge position at 30
September 2009
Year 2009 2010 2011 2012 2013 2014-2015 Total
US DOLLAR
GOLD
Forward Amount 7,963 * 60,000 122,500 119,500 91,500 156,321
contracts (oz) (245,142)
US$/oz ** $753 $227 $418 $477 $510 $370
($5,228)
Put Amount 150,000 235,860 148,000 85,500 60,500 60,500 740,360
options (oz)
sold
US$/oz $762 $747 $623 $538 $440 $450 $652
Call Amount 250,000 1,025,380 776,800 811,420 574,120 709,470 4,147,190
options (oz)
sold
US$/oz $888 $602 $554 $635 $601 $606 $617
A DOLLAR
GOLD
Forward Amount 40,000 100,000 140,000
contracts (oz)
A$/oz A$595 A$706 A$674
Call Amount 40,000 100,000 140,000
options (oz)
purchased
A$/oz A$694 A$712 A$707
*** Total Delta (234,658) (701,340) (769,538) (843,700) (642,021) (734,171) (3,925,428)
net gold: (oz)
Committed (257,963) (780,238) (836,800) (933,920) (693,620) (800,970) (4,303,511)
(oz)
* Represents a net long position resulting from both forward sales and
purchases.
** Represents a net short position and net short US Dollars resulting from
both forward sales and purchases for the period.
*** The Delta of the hedge position indicated above is the equivalent gold
position that would have the same marked-to-market sensitivity for a small
change in the gold price. This is calculated using the Black-Scholes option
formula with the ruling market prices, interest rates and volatilities as at
30 September 2009.
Rounding of figures may result in computational discrepancies.
The following table indicates the group's currency hedge position at 30
September 2009
Year 2009 2010 2011 2012 2013 2014-2015 Total
RAND DOLLAR (000)
Put options purchased Amount ($) 40,000 40,000
US$/R R11.35 R11.35
Put options sold Amount ($) 40,000 40,000
US$/R R9.59 R9.59
Call options sold Amount ($) 40,000 40,000
US$/R R12.94 R12.94
A DOLLAR (000)
Forward contracts Amount ($) 20,000 20,000
A$/US$ A$0.64 A$0.64
BRAZILIAN REAL (000)
Forward contracts Amount ($) 19,500 19,500
US$/BRL BRL2.07 BRL2.07
Fair value of derivative analysis by accounting designation at 30 September
2009
Figures in millions Cash flow hedge Non-hedge Total
accounted accounted
US Dollar
Commodity option contracts - (1,613) (1,613)
Foreign exchange option contracts - 9 9
Forward sale commodity contracts (47) (213) (260)
Forward foreign exchange contracts - 11 11
Interest rate swaps - (17) (17)
Total hedging contracts (47) (1,823) (1,870)
Option component of convertible bond - (166) (166)
Total derivatives (47) (1,989) (2,036)
Credit risk adjustment - (145) (145)
Total derivatives - before credit risk (47) (2,134) (2,181)
adjustment
Rounding of figures may result in computational discrepancies.
Exploration
Total exploration expenditure during the third quarter, inclusive of
expenditure at equity accounted joint ventures, was $55m ($24m brownfields,
$31m greenfields), compared with $43m ($23m brownfields, $20m greenfields) the
previous quarter.
GREENFIELD EXPLORATION
Greenfield exploration was undertaken in Australia, the Americas, China,
Southeast Asia, Sub-Saharan Africa, Russia, the DRC and the Middle East & North
Africa. A total of 56,970 metres of diamond, reverse circulation (RC) and
aircore (AC) drilling was completed at existing priority targets and was used
to delineate new targets in Australia and Canada.
In Australia, on the Tropicana Joint Venture, (AngloGold Ashanti 70%,
Independence Group 30%) the commencement of the feasibility study was approved
by the partners in July.
RC and diamond drilling was focused around the Tropicana-Havana resource area.
Significant results were returned from RC drilling on the near surface, western
edge of the project including 23m @ 4.1g/t Au from 62m and 19m @ 11.6g/t Au
from 39m. These results are consistent with previous drilling in the area and
improve the confidence in the resource estimate.
At Havana South, drilling identified extensions to the existing resource with
intercepts including 16m @ 5.57g/t from 204m, 22m @ 12.5g/t Au from 176m and
13m @ 5.86g/t Au from 255m. Drilling in this area has now been completed with a
resource estimate in progress.
To the east of Havana, a single diamond drillhole, 450m down-plunge from the
resource, intersected 21m @ 2.67g/t Au from 535m. This hole demonstrates the
continuation of the mineralisation down dip. Further drilling will be required
to define the continuity of higher-grade mineralized shoots that may be
amenable to underground mining.
The Public Environmental Review (PER) environmental impact assessment document
was released to the public on 28 September for an eight-week review period. The
project team has an active stakeholder engagement approach to address areas of
potential public concern.
During the quarter: 925 AC holes were drilled for 36,035m; 140 RC holes for
15,547m; and 22 diamond holes for 3,161m. Auger sampling continued with 9,360
samples collected across areas along the Tropicana-Havana trend.
Surface geochemical sampling and an airborne magnetic-radiometric survey over
the 10,600km2 Viking project, located southwest of the Tropicana JV, commenced
in September.
AngloGold Ashanti completed the purchase of the interests and rights of Anglo
American Exploration Australia in the 830km2 Saxby JV with Falcon Minerals
Limited in northwest Queensland. Gravity and airborne magnetic-radiometric
surveying were completed and infill SQUID electromagnetic surveying commenced
in the September quarter.
In Colombia, Phase I and Phase II Greenfield exploration was completed by
AngloGold Ashanti and by joint venture partners B2Gold Corporation, Mineros
S.A. and Glencore International. No drilling was undertaken by AngloGold
Ashanti or its JV partners during the quarter. At the wholly owned La Colosa
project, drill preparation work is in progress and further resource and
step-out drilling, as part of ongoing pre-feasibility study, will commence in
2010.
A total of 2,843 surface samples were collected during the quarter over the
Colombian tenements. The total area under exploration in Colombia at the end of
the quarter was 24,862km2.
Work in the remainder of the Americas focused on target-generation
opportunities, reviews and the negotiation of potential strategic alliances and
joint ventures in Brazil, the US and Canada. An exploration alliance was signed
with Horizonte Minerals for exploration in specific areas of Brazil. In Canada,
two diamond holes were drilled at the Kinskuch Lake Project near Stewart B.C.
In north-eastern Canada, the company entered into a joint venture agreement
with Commander Resources. Under the agreement, AngloGold Ashanti can earn a 51%
participating interest in Commander's Baffin Island Gold Project by funding
$20m in exploration expenditures and by completing a $1.2m private placement in
the shares of Commander. Exploration in areas covered under the terms of the
Laurentian Goldfields joint venture was undertaken with a number of areas
identified for Phase 1 follow-up.
In China, a limited trenching programme at the Jinchanggou Project in Gansu was
completed to confirm the strike extent of a new zone of gold mineralisation. An
infill soil programme across the Jinchanggou tenements was designed to identify
similar high-grade zones and is scheduled to start in mid October.
In Southeast Asia, project generation activities and evaluation of
opportunities are ongoing in a number of areas in the region, where specific
opportunities are under negotiation.
In Russia, AngloGold Ashanti and Polymetal are in the process of divesting a
number of properties held by the jointly owned Zoloto Taigi JV Company.
In Sub-Saharan Africa, project generation work has identified a number of
specific exploration opportunities that are currently under negotiation. In the
Democratic Republic of the Congo, all drill holes from the Mongbwalu resource
have been re-logged and the resource re-modelled in preparation for a
pre-feasibility study based on an underground mining scenario. Infill drilling
will commence early in the fourth quarter.
In the Middle East & North Africa, the strategic alliance between AngloGold
Ashanti and Thani Investments has continued to generate exploration targets
over specific regions of the highly prospective Arabian Nubian Shield.
BROWNFIELDS EXPLORATION
In South Africa, surface drilling continued in the Project Zaaiplaats area.
MMB5 is continuing to drill deflection 5, which is designed to intersect the
Vaal Reef along the Jersey Fault cut-off. Progress was slowed in weak rock
formations, but by the end of the quarter drilling had advanced from 2,874m to
3,295m. MZA9 continued drilling a long deflection but technical issues have
hampered progress and the first reef intersection is only expected in December
2009. A long deflection has commenced from MGR6 and the hole is currently at a
depth of 1,856m. The Vaal Reef is expected to be intersected in May 2010.
Progress on MGR8 was also slow due to weak rock formations. The hole is
currently at 3,071m and a reef intersection is anticipated in November 2009.
At Obuasi in Ghana, exploration drilling below 50L has been halted due to
flooding. Pumping is underway and drilling is scheduled to recommence in
November 2009. Drilling above 50L was delayed due to poor ventilation and the
year to date drilling programme is behind budget.
In Argentina, at Cerro Vanguardia, the exploration programme was completed in
September. Mineral Resource models were completed for the Cuncuna and Verónica
veins, whilst geological work continues in the Volcán area. Aeromagnetic data
will be collected in November.
In Australia, at Sunrise Dam, drilling continued to infill and extend both
surface and underground lodes. An RC drill programme to test the SSZ crown
pillar below the North Wall Cut Back has commenced. This will fill gaps within
the resource block model and provide additional and immediate high-grade
opportunities to advance the mining of the open pit area. Drilling to test the
down-plunge extensions of the Cosmo lode has commenced and the zone, where the
Cosmo and Astro structures interact, is being re-evaluated. Opportunities have
also been identified for open-pittable satellite targets, which will remain the
focus of exploration, together with the known underground targets.
In Brazil, at the Córrego do Sítio Sulphide Project, drilling continued with
6,531m being drilled from surface, 5,109m drilled from underground and 1,371m
of underground development. At the Lamego project, 5,531m of surface drilling
and 1,135m of underground development were completed. At Serra Grande drilling
focused on the Fiuca and Pequizão targets and a total of 8,673m were drilled
during the quarter. During October drilling with the Devidrill system will
start. The system operates from a single location and is expected to save
drilling meters and reduce the environmental damage by restricting drill site
clearance.
At Siguiri in Guinea, infill drilling was focused at Sintroko South Extension,
Kami and Kosise. Aircore drilling at Sintroko North and Tubani was done to
assess the potential between the Tubani and Bidini pits. Drilling of fresh
rock targets resumed from the bottom of the northern section of the Bidini
pit.
At Geita in Tanzania, exploration activities focused on three activities:
Ground Geophysical Surveys, core re-logging programme of the Central Thrust
Ramp ore zones and the infill drilling programme for Nyankanga Cut 7 and Geita
Hill. Approval for GGM Special Mining License (SML) enlargement was received
from the Ministry of Energy and Minerals (MEM) on the 24th of September 2009,
whereby Katoma, Nyamonge East, Katoma East and Geita Hill PL's are included in
GGM SML 45/99, for an addition of 196km2. Also, approval of time extension for
Geita West, Kukuluma and Nyankumbu Prospective Licences was granted by the MEM.
This approval grants Geita 18 additional months to complete exploration works
and bring potential targets to pre-feasibility level, as defined by Tanzania
Mine Act.
At the FE4 pit at Sadiola in Mali, the mineralisation has been extended along
strike between the pits and appears to be controlled by NE trending structures.
Geological modeling is currently being undertaken. An airborne magnetic survey
was completed in September. Preliminary images from this detailed geophysical
survey have already identified several previously unidentified structural
trends. It is expected that detailed investigation will identify priority
targets.
At Yatela, approval has been given to allow 27,000m of drilling at the Yatela
Main Pit, Yatela Extensions and Alamoutala projects. This programme will meet
the expectations of the initial drill programme as well as delineate further
areas to allow AMS to continue mining post December 2009. At Alamoutala, 4,710m
of RC drilling was completed in September. A total of 7,000m of drilling is
planned and will be completed by the end of October.
At Navachab in Namibia, off mine exploration drilling was carried out in the
Gecko valley, whilst on mine exploration drilling was conducted in the NP2 FW
vein extension and North Pit 2 plunge extension areas.
At Cripple Creek & Victor in the United States, resource extension drilling
continued during the quarter. Studies continue to quantify the potential high
grade Mineral Resource. Metallurgical testing of high grade material is
underway and further metallurgical test drilling has been planned.
Group operating results
Quarter ended Nine months
ended
Sep Jun Sep Sep Sep
2009 2009 2008 2009 2008
Unaudited
Rand / Metric
OPERATING RESULTS
UNDERGROUND OPERATIONS
Milled - 000 / - 000 tons 3,090 2,912 3,178 9,035 9,108
tonnes
Yield - g/t / - oz/t 6.41 6.33 6.84 6.32 6.95
Gold produced - kg / - oz (000) 19,816 18,424 21,737 57,097 63,346
SURFACE AND DUMP RECLAMATION
Treated - 000 / - 000 tons 3,102 3,345 3,078 9,710 8,779
tonnes
Yield - g/t / - oz/t 0.49 0.49 0.40 0.52 0.42
Gold produced - kg / - oz (000) 1,527 1,653 1,229 5,005 3,647
OPEN-PIT OPERATIONS
Mined - 000 / - 000 tons 37,408 43,894 44,777 126,654 135,667
tonnes
Treated - 000 / - 000 tons 6,713 6,487 6,318 18,937 18,813
tonnes
Stripping ratio - t (mined total - 6.08 6.35 6.24 5.92 5.44
mined ore) / t mined
ore
Yield - g/t / - oz/t 1.95 1.92 2.15 1.95 2.16
Gold in ore - kg / - oz (000) 8,604 8,231 4,089 24,586 28,766
Gold produced - kg / - oz (000) 13,077 12,430 13,573 36,913 40,691
HEAP LEACH OPERATIONS
Mined - 000 / - 000 tons 14,605 14,489 13,475 42,976 41,042
tonnes
Placed 1 - 000 / - 000 tons 4,409 5,195 6,026 15,209 17,602
tonnes
Stripping ratio - t (mined total - 2.52 1.67 1.38 1.85 1.42
mined ore) / t mined
ore
Yield 2 - g/t / - oz/t 0.60 0.71 0.56 0.63 0.62
Gold placed 3 - kg / - oz (000) 2,667 3,692 3,376 9,579 10,918
Gold produced - kg / - oz (000) 2,505 2,543 2,797 7,267 7,846
TOTAL
Gold produced - kg / - oz (000) 36,925 35,050 39,336 106,282 115,530
Gold sold - kg / - oz (000) 38,435 34,459 40,902 105,478 116,704
Price received - R/kg / -$/oz - sold 61,095 241,505 160,127 185,498 100,660
Price received - R/kg / -$/oz - sold 225,388 241,505 160,127 245,364 174,646
normalised for
accelerated
settlement of
non-hedge
derivatives
Total cash costs - R/kg / -$/oz - 133,274 127,956 121,440 134,192 111,540
produced
Total production - R/kg / -$/oz - 166,355 161,909 152,945 169,536 142,586
costs produced
PRODUCTIVITY PER EMPLOYEE
Target - g / - 328 313 346 312 330
oz
Actual - g / - 301 289 321 293 314
oz
CAPITAL - Rm / - 1,842 2,228 2,623 6,451 6,911
EXPENDITURE $m
1 Tonnes (tons) placed on to leach
pad.
2 Gold placed / tonnes
(tons) placed.
3 Gold placed into leach pad
inventory.
Rounding of figures may result in computational
discrepancies.
Group operating results
Quarter ended Nine
months
ended
Sep Jun Sep Sep Sep
2009 2009 2008 2009 2008
Unaudited
Dollar /
Imperial
OPERATING RESULTS
UNDERGROUND OPERATIONS
Milled - 000 / - 000 tons 3,406 3,210 3,503 9,959 10,040
tonnes
Yield - g/t / - oz/t 0.187 0.185 0.200 0.184 0.203
Gold produced - kg / - oz (000) 637 592 699 1,836 2,037
SURFACE AND DUMP RECLAMATION
Treated - 000 / - 000 tons 3,419 3,687 3,393 10,703 9,677
tonnes
Yield - g/t / - oz/t 0.014 0.014 0.012 0.015 0.012
Gold produced - kg / - oz (000) 49 53 40 161 117
OPEN-PIT OPERATIONS
Mined - 000 / - 000 tons 41,235 48,385 49,358 139,612 149,547
tonnes
Treated - 000 / - 000 tons 7,400 7,151 6,964 20,874 20,738
tonnes
Stripping ratio - t (mined total - 6.08 6.35 6.24 5.92 5.44
mined ore) / t mined
ore
Yield - g/t / - oz/t 0.057 0.056 0.063 0.057 0.063
Gold in ore - kg / - oz (000) 277 265 131 790 925
Gold produced - kg / - oz (000) 420 400 436 1,187 1,308
HEAP LEACH OPERATIONS
Mined - 000 / - 000 tons 16,099 15,971 14,854 47,373 45,241
tonnes
Placed 1 - 000 / - 000 tons 4,860 5,727 6,642 16,766 19,402
tonnes
Stripping ratio - t (mined total - 2.52 1.67 1.38 1.85 1.42
mined ore) / t mined
ore
Yield 2 - g/t / - oz/t 0.018 0.021 0.016 0.018 0.018
Gold placed 3 - kg / - oz (000) 86 119 109 308 351
Gold produced - kg / - oz (000) 81 82 90 233 252
TOTAL
Gold produced - kg / - oz (000) 1,187 1,127 1,265 3,417 3,714
Gold sold - kg / - oz (000) 1,236 1,108 1,315 3,391 3,752
Price received - R/kg / - $/oz - sold 261 897 644 653 416
Price received - R/kg / - $/oz - sold 906 897 644 888 707
normalised for
accelerated
settlement of
non-hedge
derivatives
Total cash - R/kg / - $/oz - 534 472 486 485 451
costs produced
Total - R/kg / - $/oz - 667 598 612 612 576
production produced
costs
PRODUCTIVITY PER EMPLOYEE
Target - g / - 10.56 10.08 11.12 10.02 10.60
oz
Actual - g / - 9.68 9.30 10.32 9.41 10.10
oz
CAPITAL - Rm / - 232 261 338 734 899
EXPENDITURE $m
1 Tonnes (tons) placed on to leach pad.
2 Gold placed / tonnes (tons)
placed.
3 Gold placed into leach pad inventory.
Group income
statement
Quarter Quarter Quarter Nine Nine
months months
ended ended ended ended ended
September June September September September
2009 2009 2008 2009 2008
SA Rand million Notes Unaudited Unaudited Unaudited Unaudited Unaudited
Revenue 2 8,806 6,817 7,205 22,447 22,019
Gold income 8,512 6,481 6,851 21,511 21,258
Cost of sales 3 (6,168) (5,212) (6,148) (17,001) (15,630)
(Loss) gain on 4 (11,216) 1,783 148 (9,228) (6,875)
non-hedge
derivatives and
other commodity
contracts
Gross (loss) (8,872) 3,051 851 (4,718) (1,248)
profit
Corporate (264) (300) (255) (916) (727)
administration
and other
expenses
Market (24) (25) (25) (77) (73)
development
costs
Exploration (311) (243) (205) (776) (739)
costs
Other operating 5 (36) (51) (73) (137) (89)
expenses
Operating 6 (231) 739 121 448 476
special items
Operating (9,738) 3,171 415 (6,176) (2,400)
(loss) profit
Interest 121 92 248 311 429
received
Exchange gain 25 285 51 326 25
Fair value adjustment (123) - (183) 183
on option component (60)
of convertible bond
Finance costs (305) (322) (235) (879) (701)
and unwinding
of obligations
Share of equity 175 160 (98) 558 (796)
accounted
investments'
profit (loss)
(Loss) profit (9,782) 3,263 381 (6,043) (3,261)
before taxation
Taxation 7 1,650 (915) (577) 351 (900)
(Loss) profit (8,132) 2,348 (196) (5,692) (4,161)
after taxation
from continuing
operations
Discontinued
operations
Profit from - - 6 - 194
discontinued
operations
(Loss) profit (8,132) 2,348 (190) (5,692) (3,968)
for the period
Allocated as
follows:
Equity (8,245) 2,304 (247) (5,940) (4,236)
shareholders
Minority 113 44 57 248 268
interest
(8,132) 2,348 (190) (5,692) (3,968)
Basic (loss)
profit per
ordinary share
(cents) 1
(Loss) profit (2,286) 642 (73) (1,653) (1,457)
from continuing
operations
Profit from - - 2 - 64
discontinued
operations
(Loss) profit (2,286) 642 (71) (1,653) (1,393)
Diluted (loss)
profit per
ordinary share
(cents) 2
(Loss) profit (2,286) 641 (73) (1,653) (1,457)
from continuing
operations
Profit from - - 2 - 64
discontinued
operations
(Loss) profit (2,286) 641 (71) (1,653) (1,393)
1 Calculated on the basic weighted
average number of ordinary shares.
2 Calculated on the diluted weighted
average number of ordinary shares.
Rounding of
figures may
result in
computational
discrepancies.
Group income
statement
Quarter Quarter Quarter Nine Nine
months months
ended ended ended ended ended
September June September September September
2009 2009 2008 2009 2008
US Dollar Notes Unaudited Unaudited Unaudited Unaudited Unaudited
million
Revenue 2 1,140 814 930 2,642 2,859
Gold income 1,101 773 885 2,533 2,761
Cost of sales 3 (796) (617) (790) (1,981) (2,029)
(Loss) gain on 4 (1,421) 231 92 (1,170) (528)
non-hedge
derivatives
and other
commodity
contracts
Gross (loss) (1,116) 387 186 (618) 204
profit
Corporate (34) (36) (33) (105) (94)
administration
and other
expenses
Market (3) (3) (3) (9) (9)
development
costs
Exploration (40) (29) (26) (91) (96)
costs
Other 5 (5) (6) (9) (16) (11)
operating
expenses
Operating 6 (31) 92 16 55 62
special items
Operating (1,229) 406 130 (784) 55
(loss) profit
Interest 16 11 32 36 56
received
Exchange gain 3 36 6 40 3
Fair value (15) - (24) 24
adjustment on option (9)
component of
convertible bond
Finance costs (39) (39) (30) (103) (91)
and unwinding
of obligations
Share of 22 19 (12) 64 (100)
equity
accounted
investments'
profit (loss)
(Loss) profit (1,236) 418 126 (771) (53)
before
taxation
Taxation 7 209 (113) (69) 57 (115)
(Loss) profit (1,027) 304 57 (714) (169)
after taxation
from
continuing
operations
Discontinued
operations
Profit from - - 1 - 24
discontinued
operations
(Loss) profit (1,027) 304 58 (714) (144)
for the period
Allocated as
follows:
Equity (1,042) 299 51 (743) (179)
shareholders
Minority 15 5 7 29 35
interest
(1,027) 304 58 (714) (144)
Basic (loss)
profit per
ordinary share
(cents) 1
(Loss) profit (289) 83 15 (207) (67)
from
continuing
operations
Profit from - - - - 8
discontinued
operations
(Loss) profit (289) 83 15 (207) (59)
Diluted (loss)
profit per
ordinary share
(cents) 2
(Loss) profit (289) 83 15 (207) (67)
from
continuing
operations
Profit from - - - - 8
discontinued
operations
(Loss) profit (289) 83 15 (207) (59)
1 Calculated on the basic weighted
average number of ordinary shares.
2 Calculated on the diluted weighted
average number of ordinary shares.
Rounding of
figures may
result in
computational
discrepancies.
Group statement of
comprehensive income
Quarter Quarter Quarter Nine Nine
months months
ended ended ended ended ended
September June September September September
2009 2009 2008 2009 2008
SA Rand million Unaudited Unaudited Unaudited Unaudited Unaudited
(Loss) profit for the period (8,132) 2,348 (190) (5,692) (3,968)
Exchange differences on 336 (2,401) 424 (1,889) 4,597
translation of foreign
operations
Net loss on cash flow hedges 122 322 396 974 1,413
reported in gold sales
Net (loss) gain on cash flow (142) 321 141 8 (622)
hedges
Hedge ineffectiveness on (18) 7 (1) 25 (3)
cash flow hedges
Realised (losses) gains on (35) 36 - (14) -
hedges of capital items
Deferred taxation thereon 17 (176) (132) (250) (196)
(56) 510 404 743 592
Net gain (loss) on available 100 (47) (14) 136 (81)
for sale financial assets
Release on disposal of - - (2) - (8)
available for sale financial
assets
Deferred taxation thereon (4) (1) 7 (8) 23
96 (48) (9) 128 (66)
Actuarial loss recognised - - (193) - (193)
Deferred taxation thereon - - 69 - 66
- - (124) - (127)
Other comprehensive income 376 (1,939) 695 (1,018) 4,996
(expense) for the period net
of tax
Total comprehensive (expense) (7,756) 409 505 (6,710) 1,028
income for the period net of
tax
Allocated as follows:
Equity shareholders (7,869) 361 424 (6,968) 729
Minority interest 113 48 81 258 299
(7,756) 409 505 (6,710) 1,028
Rounding of figures may result in computational
discrepancies.
Group statement of
comprehensive income
Quarter Quarter Quarter Nine Nine
months months
ended ended ended ended ended
September June September September September
2009 2009 2008 2009 2008
US Dollar million Unaudited Unaudited Unaudited Unaudited Unaudited
(Loss) profit for the period (1,027) 304 58 (714) (144)
Exchange differences on 76 290 (218) 350 (294)
translation of foreign
operations
Net loss on cash flow hedges 19 39 51 112 184
reported in gold sales
Net (loss) gain on cash flow (15) 33 19 1 (81)
hedges
Hedge ineffectiveness on (2) 2 - 3 -
cash flow hedges
Realised (losses) gains on (4) 4 - (2) -
hedges of capital items
Deferred taxation thereon 1 (24) (16) (32) (24)
(1) 54 54 82 79
Net gain (loss) on available 12 (4) (2) 16 (11)
for sale financial assets
Release on disposal of - - - - (1)
available for sale financial
assets
Deferred taxation thereon (1) - - (1) 2
11 (4) (2) 15 (10)
Actuarial loss recognised - - (25) - (25)
Deferred taxation thereon - - 9 - 9
- - (16) - (16)
Other comprehensive income 86 340 (182) 447 (241)
(expense) for the period net
of tax
Total comprehensive (expense) (941) 644 (124) (267) (385)
income for the period net of
tax
Allocated as follows:
Equity shareholders (956) 639 (135) (297) (424)
Minority interest 15 5 11 30 39
(941) 644 (124) (267) (385)
Rounding of figures may result in computational
discrepancies.
Group statement of financial
position
As at As at As at As at
September June December September
2009 2009 2008 2008
SA Rand million Note Unaudited Unaudited Unaudited Unaudited
ASSETS
Non-current assets
Tangible assets 37,416 37,111 41,081 55,085
Intangible assets 1,315 1,264 1,403 3,287
Investments in associates and equity 1,890 1,805 2,814 2,846
accounted joint ventures
Other investments 961 820 625 663
Inventories 2,550 2,432 2,710 2,389
Trade and other receivables 766 696 585 531
Derivatives - 15 - -
Deferred taxation 487 390 475 111
Other non-current assets 30 31 32 88
45,415 44,564 49,725 65,000
Current assets
Inventories 4,997 5,212 5,663 5,342
Trade and other receivables 3,586 3,534 2,076 2,076
Derivatives 2,900 3,551 5,386 3,851
Current portion of other 2 2 2 2
non-current assets
Cash restricted for use 501 487 415 499
Cash and cash equivalents 8,328 17,768 5,438 4,585
20,314 30,554 18,980 16,355
Non-current assets held for sale 642 669 7,497 10
20,956 31,223 26,477 16,365
TOTAL ASSETS 66,371 75,787 76,202 81,365
EQUITY AND LIABILITIES
Share capital and premium 10 39,759 37,547 37,336 36,525
Retained earnings and other (21,601) (13,570) (14,380) (6,579)
reserves
Minority interests 848 792 790 655
Total equity 19,006 24,768 23,746 30,601
Non-current liabilities
Borrowings 12,512 12,857 8,224 6,865
Environmental rehabilitation and 3,530 3,492 3,860 3,805
other provisions
Provision for pension and 1,280 1,279 1,293 1,257
post-retirement benefits
Trade, other payables and deferred 107 111 99 72
income
Derivatives 1,249 1,215 235 313
Deferred taxation 4,272 6,032 5,838 8,170
22,950 24,986 19,549 20,483
Current liabilities
Current portion of borrowings 1,867 7,846 10,046 8,581
Trade, other payables and deferred 4,449 4,014 4,946 4,857
income
Derivatives 16,954 13,011 16,426 15,998
Taxation 1,079 1,098 1,033 846
24,349 25,969 32,451 30,282
Non-current liabilities held for 66 64 456 -
sale
24,415 26,033 32,907 30,282
Total liabilities 47,365 51,019 52,456 50,764
TOTAL EQUITY AND LIABILITIES 66,371 75,787 76,202 81,365
Net asset value - cents per share 5,195 6,916 6,643 8,628
Rounding of figures may result in computational
discrepancies.
Group statement of financial
position
As at As at As at As at
September June December September
2009 2009 2008 2008
Restated
US Dollar million Note Unaudited Unaudited Unaudited Unaudited
ASSETS
Non-current assets
Tangible assets 4,980 4,813 4,345 6,663
Intangible assets 175 164 148 398
Investments in associates and equity 252 234 298 344
accounted joint ventures
Other investments 128 106 66 80
Inventories 339 315 287 289
Trade and other receivables 102 90 62 64
Derivatives - 2 - -
Deferred taxation 65 51 50 13
Other non-current assets 4 4 3 11
6,045 5,780 5,259 7,863
Current assets
Inventories 665 676 599 646
Trade and other receivables 477 458 220 251
Derivatives 386 461 570 466
Current portion of other - - - -
non-current assets
Cash restricted for use 67 63 44 60
Cash and cash equivalents 1,108 2,305 575 555
2,703 3,963 2,008 1,978
Non-current assets held for sale 85 87 793 1
2,788 4,050 2,801 1,979
TOTAL ASSETS 8,833 9,830 8,060 9,842
EQUITY AND LIABILITIES
Share capital and premium 10 5,794 5,508 5,485 5,403
Retained earnings and other (3,378) (2,398) (3,057) (1,781)
reserves
Minority interests 113 103 83 79
Total equity 2,529 3,212 2,511 3,702
Non-current liabilities
Borrowings 1,665 1,668 870 830
Environmental rehabilitation and 470 453 408 460
other provisions
Provision for pension and 170 166 137 152
post-retirement benefits
Trade, other payables and deferred 14 14 11 9
income
Derivatives 166 158 25 38
Deferred taxation 569 782 617 988
3,054 3,241 2,068 2,478
Current liabilities
Current portion of borrowings 249 1,018 1,063 1,038
Trade, other payables and deferred 592 521 524 587
income
Derivatives 2,256 1,687 1,737 1,935
Taxation 144 142 109 102
3,241 3,368 3,433 3,663
Non-current liabilities held for 9 8 48 -
sale
3,250 3,376 3,481 3,663
Total liabilities 6,304 6,617 5,549 6,140
TOTAL EQUITY AND LIABILITIES 8,833 9,830 8,060 9,842
Net asset value - cents per share 691 897 702 1,044
Rounding of figures may result in computational
discrepancies.
Group statement of cashflows
Quarter Quarter Quarter Nine Nine
months months
ended ended ended ended ended
September June September September September
2009 2009 2008 2009 2008
SA Rand million Unaudited Unaudited Unaudited Unaudited Unaudited
Cash flows from operating
activities
Receipts from customers 8,545 6,928 6,818 21,877 21,345
Payments to suppliers and (6,147) (5,135) (6,193) (15,008) (18,218)
employees
Cash generated from 2,398 1,793 625 6,869 3,127
operations
Cash generated (utilised) by - - 9 - (7)
discontinued operations
Dividend received from equity 21 421 141 615 483
accounted investments
Taxation paid (234) (340) (129) (998) (902)
Cash utilised for hedge (6,315) - (7,755) (6,315) (8,504)
buyback costs
Net cash (outflow) inflow (4,130) 1,874 (7,108) 171 (5,804)
from operating activities
Cash flows from investing
activities
Capital expenditure (1,836) (2,189) (2,615) (6,413) (6,881)
Proceeds from disposal of 43 7,156 25 7,216 268
tangible assets
Proceeds from disposal of - - 1 - 79
assets of discontinued
operations
Other investments acquired (328) (33) (228) (521) (572)
Associates acquired - (9) (3) (9) (3)
Proceeds on disposal of - - (13) - 383
associate
Associates' loans advanced - - (36) - (35)
Associates' loans repaid - 3 2 3 32
Proceeds from disposal of 258 60 214 484 526
investments
(Increase) decrease in cash (16) 10 24 (110) (144)
restricted for use
Interest received 129 88 256 316 440
Loans advanced - (1) - (1) (3)
Repayment of loans advanced 1 1 1 2 2
Net cash (outflow) inflow (1,749) 5,086 (2,372) 967 (5,907)
from investing activities
Cash flows from financing
activities
Proceeds from issue of share 2,215 15 13,494 2,345 13,580
capital
Share issue expenses (34) (6) (410) (45) (410)
Proceeds from borrowings 6,709 7,092 2,305 24,739 5,412
Repayment of borrowings (12,957) (1,003) (4,402) (24,095) (4,589)
Finance costs paid (110) (245) (242) (766) (522)
Advanced proceeds from rights - - (6) - -
offer
Dividends paid (253) - (254) (431) (455)
Net cash (outflow) inflow (4,430) 5,853 10,486 1,747 13,016
from financing activities
Net (decrease) increase in (10,309) 12,813 1,005 2,885 1,306
cash and cash equivalents
Translation 869 (919) (81) 5 33
Cash and cash equivalents at 17,768 5,874 3,661 5,438 3,246
beginning of period
Cash and cash equivalents at 8,328 17,768 4,585 8,328 4,585
end of period
Cash generated from
operations
(Loss) profit before taxation (9,782) 3,263 381 (6,043) (3,261)
Adjusted for:
Movement on non-hedge 11,041 (525) (821) 12,136 4,215
derivatives and other
commodity contracts
Amortisation of tangible 1,107 1,095 1,111 3,463 3,233
assets
Finance costs and unwinding 305 322 235 879 701
of obligations
Environmental, rehabilitation 33 (27) 54 22 113
and other expenditure
Operating special items 231 (733) (121) (441) (476)
Amortisation of intangible 4 4 4 14 11
assets
Deferred stripping (96) (263) (124) (671) (278)
Fair value adjustment on 60 123 - 183 (183)
option components of
convertible bond
Interest receivable (121) (92) (248) (311) (429)
Share of equity accounted (175) (160) 98 (558) 796
investments' (profit) loss
Other non-cash movements 23 (285) 295 (179) 412
Movements in working capital (232) (928) (238) (1,625) (1,727)
2,398 1,793 625 6,869 3,127
Movements in working capital
Decrease (increase) in 104 1,153 (310) 817 (2,427)
inventories
(Increase) decrease in trade (125) 131 (241) (332) (753)
and other receivables
(Decrease) increase in trade (211) (2,212) 312 (2,110) 1,452
and other payables
(232) (928) (238) (1,625) (1,727)
Rounding of figures may result in computational
discrepancies.
Group statement of cashflows
Quarter Quarter Quarter Nine Nine
months months
ended ended ended ended ended
September June September September September
2009 2009 2008 2009 2008
Restated
US Dollar million Unaudited Unaudited Unaudited Unaudited Unaudited
Cash flows from operating
activities
Receipts from customers 1,104 811 884 2,561 2,781
Payments to suppliers and (741) (575) (765) (1,694) (2,359)
employees
Cash generated from 363 236 119 867 422
operations
Cash generated (utilised) by - - 1 - (1)
discontinued operations
Dividend received from equity 5 59 15 82 58
accounted investments
Taxation paid (32) (40) (16) (115) (117)
Cash utilised for hedge (797) - (1,018) (797) (1,112)
buyback costs
Net cash (outflow) inflow (461) 255 (899) 37 (750)
from operating activities
Cash flows from investing
activities
Capital expenditure (239) (257) (337) (737) (895)
Proceeds from disposal of 5 893 3 900 35
tangible assets
Proceeds from disposal of - - - - 10
assets of discontinued
operations
Other investments acquired (39) (5) (29) (60) (74)
Associates acquired - (1) 1 (1) 1
Proceeds on disposal of - - - - 50
associate
Associates' loans advanced - - (5) - (4)
Associates' loans repaid - - - - 4
Proceeds from disposal of 31 8 28 56 68
investments
(Increase) decrease in cash (2) 1 3 (11) (19)
restricted for use
Interest received 17 11 33 37 57
Loans advanced - - - - -
Repayment of loans advanced - - - - -
Net cash (outflow) inflow (227) 650 (303) 184 (768)
from investing activities
Cash flows from financing
activities
Proceeds from issue of share 287 3 1,710 301 1,722
capital
Share issue expenses (5) (1) (54) (6) (54)
Proceeds from borrowings 784 856 298 2,745 704
Repayment of borrowings (1,573) (111) (573) (2,708) (597)
Finance costs paid (16) (31) (31) (88) (68)
Advanced proceeds from rights - - (1) - -
offer
Dividends paid (32) - (33) (50) (58)
Net cash (outflow) inflow (555) 716 1,317 194 1,649
from financing activities
Net (decrease) increase in (1,243) 1,621 114 415 131
cash and cash equivalents
Translation 46 71 (27) 118 (54)
Cash and cash equivalents at 2,305 613 467 575 477
beginning of period
Cash and cash equivalents at 1,108 2,305 555 1,108 555
end of period
Cash generated from
operations
(Loss) profit before taxation (1,236) 418 126 (771) (53)
Adjusted for:
Movement on non-hedge 1,398 (81) (178) 1,481 187
derivatives and other
commodity contracts
Amortisation of tangible 143 130 143 400 420
assets
Finance costs and unwinding 39 39 30 103 91
of obligations
Environmental, rehabilitation 5 (3) 7 3 14
and other expenditure
Operating special items 31 (92) (16) (54) (62)
Amortisation of intangible 1 1 - 2 1
assets
Deferred stripping (13) (31) (16) (75) (36)
Fair value adjustment on 9 15 - 24 (24)
option components of
convertible bond
Interest receivable (16) (11) (32) (36) (56)
Share of equity accounted (22) (19) 12 (64) 100
investments' (profit) loss
Other non-cash movements 3 (36) 37 (24) 51
Movements in working capital 21 (94) 5 (122) (211)
363 236 119 867 422
Movements in working capital
(Increase) decrease in (12) (74) 14 (120) (150)
inventories
Increase in trade and other (25) (44) (17) (100) (56)
receivables
Increase (decrease) in trade 58 24 7 98 (6)
and other payables
21 (94) 5 (122) (211)
Rounding of figures may result in computational
discrepancies.
Group
statement of
changes in
equity
Cash Available Foreign
Share Other flow for Actuarial currency
capital capital Retained hedge sale (losses) translation Minority Total
&
SA Rand premium reserves earnings reserve reserve gains reserve Total interests equity
million
Balance at 22,371 714 (5,524) (1,634) 59 (108) 326 16,204 429 16,633
December 2007
(Loss) profit (4,236) (4,236) 268 (3,968)
for the
period
Comprehensive 561 (66) (127) 4,597 4,965 31 4,996
income
(expense)
Total - - (4,236) 561 (66) (127) 4,597 729 299 1,028
comprehensive
(expense)
income
Shares issued 14,154 14,154 14,154
Share-based 161 161 161
payment for
share awards
Dividends (324) (324) (324)
paid
Dividends of - (131) (131)
subsidiaries
Transfers to 12 (12) - -
other
reserves
Acquisition (853) (853) 6 (847)
of minority
interest
Translation (5) (122) 2 (125) 52 (73)
Balance at 36,525 882 (10,949) (1,195) (7) (233) 4,923 29,946 655 30,601
September
2008
Balance at 37,336 799 (22,879) (1,008) (18) (347) 9,073 22,956 790 23,746
December 2008
(Loss) profit (5,940) (5,940) 248 (5,692)
for the
period
Comprehensive 733 128 (1,889) (1,028) 10 (1,018)
income
(expense)
Total - - (5,940) 733 128 - (1,889) (6,968) 258 (6,710)
comprehensive
(expense)
income
Shares issued 2,423 2,423 2,423
Share-based 120 120 120
payment for
share awards
Dividends (392) (392) (392)
paid
Dividends of - (43) (43)
subsidiaries
Translation (23) 43 (3) 2 19 (157) (138)
Balance at 39,759 896 (29,211) (232) 107 (345) 7,184 18,158 848 19,006
September
2009
US Dollar
million
Balance at 3,608 105 (1,020) (240) 9 (16) (67) 2,379 63 2,442
December 2007
(Loss) profit (179) (179) 35 (144)
for the
period
Comprehensive 75 (10) (16) (294) (245) 4 (241)
income
(expense)
Total - - (179) 75 (10) (16) (294) (424) 39 (385)
comprehensive
(expense)
income
Shares issued 1,795 1,795 1,795
Share-based 21 21 21
payment for
share awards
Dividends (41) (41) (41)
paid
Dividends of - (17) (17)
subsidiaries
Transfers to 1 (1) - -
other
reserves
Acquisition (111) (111) 1 (110)
of minority
interest
Translation (20) 20 4 4 (7) (3)
Balance at 5,403 107 (1,352) (145) (1) (28) (361) 3,623 79 3,702
September
2008 -
restated
Balance at 5,485 85 (2,368) (107) (2) (37) (628) 2,428 83 2,511
December 2008
(Loss) profit (743) (743) 29 (714)
for the
period
Comprehensive 81 15 350 446 1 447
income
Total - - (743) 81 15 - 350 (297) 30 (267)
comprehensive
(expense)
income
Shares issued 309 309 309
Share-based 14 14 14
payment for
share awards
Dividends (45) (45) (45)
paid
Dividends of - (5) (5)
subsidiaries
Translation 20 (5) 1 (9) 7 5 12
Balance at 5,794 119 (3,156) (31) 14 (46) (278) ,416 113 2,529
September
2009
Rounding of figures may result in
computational discrepancies.
Notes
for the quarter and nine months ended 30 September 2009
1. Basis of preparation
The financial statements in this quarterly report have been prepared
in accordance with the historic cost convention except for certain financial
instruments which are stated at fair value. Except for the change in accounting
policy described in note 15, the group's accounting policies used in the
preparation of these financial statements are consistent with those used in the
annual financial statements for the year ended 31 December 2008 and revised
International Financial Reporting Standards (IFRS) which are effective 1
January 2009, where applicable, with the only significant changes arising from
IAS1 (revised) - "Presentation of Financial Statements" and IFRS8 "Operating
Segments". As a result of the revision of IAS1, a Statement of comprehensive
income, which discloses non owner changes in equity, and a statement of changes
in equity are presented. The effects of the adoption of IFRS8 are disclosed in
Segmental reporting.
The financial statements of AngloGold Ashanti Limited have been
prepared in compliance with IAS34, JSE Listings Requirements and in the manner
required by the South African Companies Act, 1973 for the preparation of
financial information of the group for the quarter and nine months ended 30
September 2009.
2. Revenue
Quarter ended Nine months ended Quarter ended Nine months ended
Sep Jun Sep Sep Sep Sep Jun Sep Sep Sep
2009 2009 2008 2009 2008 2009 2009 2008 2009 2008
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
SA Rand million US Dollar million
Gold income 8,512 6,481 6,851 21,511 21,258 1,101 773 885 2,533 2,761
By-products
(note 3) 173 244 106 625 332 23 30 14 73 43
Interest
received 121 92 248 311 429 16 11 32 36 56
8,806 6,817 7,205 22,447 22,019 1,140 814 930 2,642 2,859
3. Cost of sales
Quarter ended Nine months ended Quarter ended Nine months ended
Sep Jun Sep Sep Sep Sep Jun Sep Sep Sep
2009 2009 2008 2009 2008 2009 2009 2008 2009 2008
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
SA Rand million US Dollar million
Cash
operating
costs (4,719) (4,280) (4,540) (13,628) (11,916) (608) (507) (584) (1,583) (1,548)
By-products
revenue
(note 2) 173 244 106 625 332 23 30 14 73 43
By-products
cash operating
costs (74) (105) (57) (275) (221) (10) (13) (8) (32) (29)
(4,620) (4,141) (4,491) (13,278) (11,805) (595) (490) (578) (1,542) (1,534)
Other cash
costs (222) (182) (177) (611) (538) (29) (22) (23) (71) (70)
Total cash
costs (4,842) (4,323) (4,668) (13,888) (12,343) (624) (512) (601) (1,613) (1,604)
Retrenchment
costs (17) (40) (14) (71) (56) (2) (5) (2) (8) (7)
Rehabilitation
and other non-cash
costs (96) (32) (102) (187) (221) (12) (4) (13) (22) (28)
Production
costs (4,955) (4,395) (4,784) (14,147) (12,620) (638) (521) (616) (1,643) (1,639)
Amortisation of
tangible
assets (1,107) (1,095) (1,111) (3,463) (3,233) (143) (130) (143) (400) (420)
Amortisation
of intangible
assets (4) (4) (4) (14) (11) (1) (1) - (2) (1)
Total
production
costs (6,066) (5,495) (5,899) (17,624) (15,864) (781) (652) (759) (2,045) (2,060)
Inventory
change (102) 282 (249) 622 234 (14) 34 (32) 65 31
(6,168) (5,212) (6,148) (17,001) (15,630) (796) (617) (790) (1,981) (2,029)
Rounding of figures may result in computational discrepancies.
4. (Loss) gain on non-hedge derivatives and other commodity contracts
Quarter ended Nine months ended Quarter ended Nine months ended
Sep Jun Sep Sep Sep Sep Jun Sep Sep Sep
2009 2009 2008 2009 2008 2009 2009 2008 2009 2008
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
SA Rand million US Dollar million
(Loss) gain on
realised
non-hedge
derivatives (139) 1,243 (519) 2,970 (1,797) (19) 149 (66) 319 (230)
Realised loss
on other
commodity
contracts - - - - (253) - - - - (32)
Loss on hedge
buyback costs (6,315) - - (6,315) (7,765) (797) - - (797) (979)
(Loss) gain on
unrealised
non-hedge
derivatives (4,762) 540 666 (5,883) 2,876 (606) 82 158 (692) 705
Unrealised gain
on other
commodity
physical
borrowings - - 1 - 26 - - - - 3
Provision
reversed for
gain on future
deliveries of
other
commodities - - - - 37 - - - - 5
(11,216) 1,783 148 (9,228) (6,875) (1,421) 231 92 (1,170) (528)
5. Other operating expenses
Quarter ended Nine months ended Quarter ended Nine months ended
Sep Jun Sep Sep Sep Sep Jun Sep Sep Sep
2009 2009 2008 2009 2008 2009 2009 2008 2009 2008
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
SA Rand million US Dollar million
Pension and
medical defined
benefit
provisions (24) (24) (24) (73) (72) (3) (3) (3) (9) (9)
Claims filed by
former employees
in respect of
loss of
employment,
work- related
accident
injuries and
diseases,
governmental
fiscal claims
and costs of old
tailings
operations (11) (24) (49) (62) (17) (2) (3) (6) (7) (2)
Miscellaneous (1) (3) - (2) - - - - - -
(36) (51) (73) (137) (89) (5) (6) (9) (16) (11)
6. Operating special items
Quarter ended Nine months ended Quarter ended Nine months ended
Sep Jun Sep Sep Sep Sep Jun Sep Sep Sep
2009 2009 2008 2009 2008 2009 2009 2008 2009 2008
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
SA Rand million US Dollar million
Reimbursement of
indirect tax
expenses 11 12 1 21 77 1 2 - 3 10
Siguiri royalty
payment
calculation
dispute with the
Guinean
Administration - - - - (27) - - - - (4)
ESOP and BEE
costs resulting
from rights
offer - - - - (76) - - - - (10)
Impairment of
tangible assets
(note 8) (94) - (3) (94) (7) (13) - - (13) (1)
Recovery of loan - - 34 - 34 - - 4 - 4
Recovery (loss)
on consignment
stock 7 (116) - (109) - 1 (15) - (14) -
Provision for
bad debt -
Pamodzi Gold - (3) - (65) - - - - (6) -
(Loss) profit on
disposal and
abandonment of
land, mineral
rights, tangible
assets and
exploration
properties (note
8) (156) 839 82 689 457 (21) 105 11 84 60
Insurance claim
recovery (note
8) - 7 - 7 - - 1 - 1 -
(Loss) profit on
disposal of
investment in
associate (note
8) - - (12) - 18 - - (2) - 2
Nufcor Uranium
Trust
contributions by
other members
(note 8) - - 19 - - - - 3 - -
(231) 739 121 448 476 (31) 92 16 55 62
Rounding of figures may result in computational discrepancies.
7. Taxation
Quarter ended Nine months ended Quarter ended Nine months ended
Sep Jun Sep Sep Sep Sep Jun Sep Sep Sep
2009 2009 2008 2009 2008 2009 2009 2008 2009 2008
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
SA Rand million US Dollar million
South
African
taxation
Mining tax 14 (108) - (93) - 2 (13) - (11) (1)
Non-mining
tax 77 (126) (21) (79) (67) 10 (15) (3) (9) (10)
Under
provision
prior year (12) (13) (10) (40) (61) (2) (2) (1) (5) (8)
Deferred
taxation:
Temporary
differences (44) 12 (252) (355) 607 (6) 2 (33) (36) 75
Unrealised
non-hedge
derivatives
and other
commodity
contracts 1,317 (238) 4 1,247 (742) 167 (30) 5 154 (90)
Change in
statutory
tax rate - - - - 69 - - - - 9
1,353 (473) (279) 680 (193) 171 (58) (32) 93 (24)
Foreign
taxation
Normal
taxation (262) (379) (84) (777) (420) (34) (46) (11) (93) (56)
(Under)
over
provision
prior year (27) (3) 5 (41) 41 (4) - 1 (5) 6
Deferred
taxation:
Temporary
differences 393 (155) (207) 190 (224) 51 (21) (26) 25 (29)
Unrealised
non-hedge
derivatives
and other
commodity
contracts 193 94 (12) 299 (104) 24 12 (1) 38 (13)
297 (442) (298) (329) (707) 38 (55) (37) (36) (92)
1,650 (915) (577) 351 (900) 209 (113) (69) 57 (115)
8. Headline (loss) earnings
Quarter ended Nine months ended Quarter ended Nine months ended
Sep Jun Sep Sep Sep Sep Jun Sep Sep Sep
2009 2009 2008 2009 2008 2009 2009 2008 2009 2008
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
SA Rand million US Dollar million
The (loss)
profit
attributable
to equity
shareholders
has been
adjusted by
the following
to arrive at
headline
(loss)
earnings:
(Loss) profit
attributable
to equity
shareholders (8,245) 2,304 (247) (5,940) (4,236) (1,042) 299 51 (743) (179)
Impairment of
tangible
assets (note
6) 94 - 3 94 7 13 - - 13 1
Loss (profit)
on disposal
and
abandonment
of land,
mineral
rights,
tangible
assets and
exploration
properties
(note 6) 156 (839) (82) (689) (457) 21 (105) (11) (84) (60)
Nufcor
Uranium Trust
contributions
by other
members (note
6) - - (19) - - - - (3) - -
Insurance
claim
recovery
(note 6) - (7) - (7) - - (1) - (1) -
Loss (profit)
on disposal
of investment
in associate
(note 6) - - 12 - (18) - - 2 - (2)
Profit on
disposal of
discontinued
assets - - (1) - (218) - - - - (27)
Impairment of
investment in
associates (2) 3 21 3 35 - - 3 - 4
Profit on
disposal of
assets in
associate - - - - (23) - - - - (3)
Taxation on
items above -
current
portion (48) 201 2 156 7 (6) 26 - 19 1
Taxation on
items above -
deferred
portion (22) (32) 13 (54) 17 (3) (4) 2 (7) 2
Discontinued
operations
taxation on
items above - - - - (6) - - - - (1)
(8,068) 1,631 (298) (6,437) (4,891) (1,018) 215 44 (803) (263)
Cents per
share (1)
Headline
(loss)
earnings (2,237) 455 (86) (1,791) (1,609) (282) 60 13 (223) (87)
(1)Calculated on the basic weighted average number of ordinary shares.
Rounding of figures may result in computational discrepancies.
9. Number of shares
Quarter ended Nine months ended
Sep Jun Sep Sep Sep
2009 2009 2008 2009 2008
Unaudited Unaudited Unaudited Unaudited Unaudited
Authorised number of shares:
Ordinary shares of
25 SA cents each 600,000,000 600,000,000 400,000,000 600,000,000 400,000,000
E ordinary shares of
25 SA cents each 4,280,000 4,280,000 4,280,000 4,280,000 4,280,000
A redeemable preference
shares of 50 SA cents each 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000
B redeemable preference
shares of 1 SA cent each 5,000,000 5,000,000 5,000,000 5,000,000 5,000,000
Issued and fully paid number of shares:
Ordinary shares in issue 362,003,085 354,241,602 350,677,750 362,003,085 350,677,750
E ordinary shares in issue 3,832,568 3,879,290 4,002,887 3,832,568 4,002,887
Total ordinary shares: 365,835,653 358,120,892 354,680,637 365,835,653 354,680,637
A redeemable preference shares 2,000,000 2,000,000 2,000,000 2,000,000 2,000,000
B redeemable preference shares 778,896 778,896 778,896 778,896 778,896
In calculating the diluted number of ordinary shares outstanding for the
period, the following were taken into consideration:
Ordinary shares 356,194,586 354,198,056 342,692,446 354,685,548 299,550,334
E ordinary shares 3,848,172 3,896,280 4,018,901 3,894,634 4,068,636
Fully vested options 622,613 551,521 405,584 774,457 418,312
Weighted average number
of shares 360,665,371 358,645,857 347,116,931 359,354,639 304,037,282
Dilutive potential of
share options - 897,098 786,816 - -
Diluted number of
ordinary shares (1) 360,665,371 359,542,955 347,903,747 359,354,639 304,037,282
(1) The basic and diluted number of ordinary shares is the same for the quarter
ended September 2009, nine months ended September 2009 and nine months ended
September 2008 as the effects of shares for performance related options are
anti-dilutive.
10. Share capital and premium
As at As at
Sep Jun Dec Sep Sep Jun Dec Sep
2009 2009 2008 2008 2009 2009 2008 2008
Restated (1)
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
SA Rand million US Dollar million
Balance at
beginning
of period 38,248 38,248 23,324 23,324 5,625 5,625 3,752 3,752
Ordinary
shares
issued 2,409 202 14,946 14,139 308 22 1,875 1,794
E ordinary
shares
cancelled (17) (11) (22) (17) (2) (1) (3) (2)
Sub-total 40,640 38,439 38,248 37,446 5,931 5,645 5,625 5,543
Redeemable
preference
shares
held
within the
group (313) (313) (313) (313) (53) (53) (53) (53)
Ordinary
shares
held
within the
group (259) (264) (273) (278) (38) (38) (40) (40)
E ordinary
shares
held
within
group (309) (315) (326) (330) (45) (46) (47) (47)
Balance at
end of
period 39,759 37,547 37,336 36,525 5,794 5,508 5,485 5,403
(1) During 2009, the group changed its accounting policy to account for equity
using historical rates of exchange. The effect of the change has been
calculated retrospectively.
11. Exchange rates
Sep Jun Dec Sep
2009 2009 2008 2008
Unaudited Unaudited Unaudited Unaudited
ZAR/USD average for the year to date 8.70 9.18 8.25 7.69
ZAR/USD average for the quarter 7.77 8.40 9.92 7.77
ZAR/USD closing 7.51 7.71 9.46 8.27
ZAR/AUD average for the year to date 6.48 6.49 6.93 7.02
ZAR/AUD average for the quarter 6.47 6.42 6.67 6.86
ZAR/AUD closing 6.62 6.21 6.57 6.66
BRL/USD average for the year to date 2.08 2.20 1.84 1.69
BRL/USD average for the quarter 1.87 2.07 2.28 1.67
BRL/USD closing 1.77 1.96 2.34 1.93
ARS/USD average for the year to date 3.70 3.63 3.16 3.11
ARS/USD average for the quarter 3.83 3.73 3.33 3.04
ARS/USD closing 3.84 3.80 3.45 3.12
Rounding of figures may result in computational discrepancies.
12. Capital commitments
Sep Jun Dec Sep Sep Jun Dec Sep
2009 2009 2008 2008 2009 2009 2008 2008
Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited Unaudited
SARandmillion USDollarmillion
Orders
placed and
outstanding
on capital
contracts
at the
prevailing
rate of
exchange
(1) 1,096 1,333 775 2,292 146 173 82 277
(1) Includes capital commitments relating to equity accounted joint ventures
Liquidity and capital resources:
To service the above capital commitments and other operational requirements,
the group is dependent on existing cash resources, cash generated from
operations and borrowing facilities.
Cash generated from operations is subject to operational, market and other
risks. Distributions from operations may be subject to foreign investment and
exchange control laws and regulations and the quantity of foreign exchange
available in offshore countries. In addition, distributions from joint ventures
are subject to the relevant board approval.
The credit facilities and other financing arrangements contain financial
covenants and other similar undertakings. To the extent that external
borrowings are required, the groups covenant performance indicates that
existing financing facilities will be available to meet the above commitments.
To the extent that any of the financing facilities mature in the near future,
the group believes that these facilities can be refinanced.
13. Contingent liabilities
AngloGold Ashanti's material contingent liabilities at 30 September
2009 are detailed below:
Guarantees and contingencies (millions) SA rand US dollar
Contingent liabilities
Groundwater pollution - South Africa (1) - -
Deep groundwater pollution - South Africa (2) - -
Sales tax on gold deliveries - Brazil (3) 624 83
Other tax disputes - Brazil (4) 128 17
Withholding taxes - Ghana (5) 49 6
Financial Guarantees
Oro Group (Pty) Ltd (6) 100 13
901 119
AngloGold Ashanti is subject to contingencies pursuant to
environmental laws and regulations that may in future require the Group to take
corrective action as follows:
Groundwater pollution - South Africa - AngloGold Ashanti has identified
groundwater contamination plumes at its Vaal River and West Wits operations,
which have occurred primarily as a result of seepage from mine residue
stockpiles. Numerous scientific, technical and legal studies have been
undertaken since 2002 to assist in determining the magnitude of the
contamination and to find sustainable remediation solutions. The company has
instituted processes to reduce future potential seepage and it has been
demonstrated that Monitored Natural Attenuation (MNA) by the existing
environment will contribute to improvement in some instances. Furthermore,
literature reviews, field trials and base line modelling techniques suggest,
but are not yet proven, that the use of phyto-technologies can address the soil
and groundwater contamination at all South African operations. Subject to the
completion of trials and the technology being a proven remediation technique,
no reliable estimate can be made for the obligation at this time.
Deep groundwater pollution - South Africa - AngloGold Ashanti has identified a
flooding and future pollution risk posed by deep groundwater in the Klerksdorp
and Far West Rand gold fields. Various studies have been undertaken by
AngloGold Ashanti since 1999. However, due to the interconnected nature of
mining operations, any proposed solution needs to be a combined one that is
supported by all the mines located in these gold fields. Toward this the
Department of Mineral Resources and affected mining companies are now involved
in the development of a "Regional Mine Closure Strategy". Nevertheless, in view
of the limitation of current information for the accurate estimation of a
liability, no reliable estimate can be made for the obligation at this time.
Sales tax on gold deliveries - Brazil - Mineração Serra Grande S.A. (MSG),
received two tax assessments from the State of Goiás related to payments of
sales taxes on gold deliveries for export. The MSG operation is co-owned with
Kinross Gold Corporation. AngloGold Ashanti Brasil Mineração Ltda. manages the
operation and its attributable share of the first assessment is approximately
$46m. In November 2006 the administrative council's second chamber ruled in
favour of MSG and fully cancelled the tax liability related to the first
period. The State of Goiás has appealed to the full board of the State of
Goiás tax administrative council. The second assessment was issued by the
State of Goiás in October 2006 on the same grounds as the first one, and the
attributable share of the assessment is approximately $28m. The company
believes both assessments are in violation of Federal legislation on sales
taxes.
MSG received a tax assessment in October 2003 from the State of Minas Gerais
related to sales taxes on gold. The tax administrators rejected the company's
appeal against the assessment. The company is now appealing the dismissal of
the case. The company's attributable share of the assessment is approximately
$9m.
AngloGold subsidiaries in Brazil are involved in various disputes with tax
authorities. These disputes involve federal tax assessments including income
tax, royalties, social contributions and annual property tax. The amount
involved is approximately $17m.
Withholding Taxes - Ghana - AngloGold Ashanti (Ghana) Limited received a tax
assessment for $6m during September 2009 following an audit by the tax
authorities related to indirect taxes on various items. Management is of the
opinion that the indirect taxes are not payable and the company has lodged an
objection.
Provision of surety - South Africa - AngloGold Ashanti has provided sureties in
favour of a lender on a gold loan facility with its affiliate Oro Africa (Pty)
Ltd and one of its subsidiaries to a maximum value of R100m ($13m). The
suretyship agreements have a termination notice period of 90 days.
14. Concentration of risk
There is a concentration of risk in respect of reimbursable value
added tax and fuel duties from the Tanzanian government:
Reimbursable value added tax due from the Tanzanian government amounts to $25m
at 30 September 2009 (30 June 2009: $17m). The last audited value added tax
return was for the period ended 31 August 2009 and at the balance sheet date
was $21m. The outstanding amounts at Geita have been discounted to their
present value at a rate of 7.8%.
Reimbursable fuel duties from the Tanzanian government amounts to $48m at
30 September 2009 (30 June 2009: $44m). Fuel duty claims are required to be
submitted after consumption of the related fuel and are subject to
authorisation by the Customs and Excise authorities. Claims for refund of fuel
duties amounting to $43m have been lodged with the Customs and Excise
authorities, whilst claims for refund of $5m have not yet been lodged. The
outstanding amounts have been discounted to their present value at a rate of
7.8%.
15. Change in accounting policy
In terms of IAS 21 "The Effects of Changes in Foreign Exchange Rates",
the group has previously presented equity at the closing rate of exchange.
During the current year the group changed its accounting policy to account for
equity using historical rates of exchange. Management's judgement is that the
change in accounting policy will provide more relevant and reliable information
when the group is compared to its gold mining peers, as they report their
equity at historical rates of exchange. The effects of the change in
accounting policy have been calculated retrospectively and are as follows as at
31 December 2008 and 2007:
Share capital and premium - US Dollar million 2008 2007
Previously at closing rate 3,425 3,292
Restated at historical rate 3,752 3,713
Impact on translation 327 421
16. Borrowings
AngloGold Ashanti's borrowings are interest bearing.
17. Post balance sheet events
After close of business on 15 October 2009, South African time, the
Canadian Courts in British Columbia, approved the scheme of arrangement wherein
Moto Goldmines Limited became a wholly owned subsidiary of a joint venture
between AngloGold Ashanti Limited and Randgold Resources Limited. When any
remaining conditions precedent have been fulfilled, AngloGold Ashanti will
equity account the results of the joint venture.
18. Announcements
On 31 August 2009, AngloGold Ashanti announced the launch of an equity offering
to fund its proposed 50% acquisition of Moto Goldmines Limited. This was
followed by an announcement on 1 September 2009 detailing the placing of
7,624,162 AngloGold Ashanti ordinary shares at an issue price of $37.25 per
American Depositary Share (ADR)) (or R288.32 per ordinary share) which price
represented an approximate 3% discount to the closing price of an AngloGold
Ashanti ADR on the NYSE on 31 August 2009. The offering closed on 8 September
2009 and total proceeds of some $284 million was received.
On 5 October 2009, AngloGold Ashanti Limited and the De Beers Group of
Companies announced the formation of a joint venture to explore for, and
ultimately mine, gold and other minerals and metals, excluding diamonds, on
marine deposits located in, or adjacent to, the area between the high water
mark and the edge of the continental shelf on a worldwide basis.
Pursuant to its announcement of 5 August 2009, AngloGold Ashanti Limited
announced on 15 October 2009 that it had acquired a 50% interest in Moto
Goldmines Limited in a back-to-back joint venture agreement entered into with
Randgold Resources Limited following the acquisition by Randgold of the entire
issued share capital of Moto.
19. Dividend
Interim Dividend No. 106 of 60 South African cents of approximately
4.54 UK pence or approximately 0.10956 cedis per share was paid to registered
shareholders on 28 August 2009, while a dividend of 1.7916 Australian cents per
CHESS Depositary Interest (CDI) was paid on the same day. On 31 August 2009, a
dividend of 0.0010956 cedis per Ghanaian Depositary Share (GhDS) was paid to
holders thereof. Each CDI represents one-fifth of an ordinary share, and 100
GhDSs represents one ordinary share. A dividend was paid to holders of American
Depositary Receipts (ADRs) on 8 September 2009 at a rate of 7.6553 US cents per
American Depositary Share (ADS). Each ADS represents one ordinary share.
In addition, directors declared interim Dividend No. E6 of 30 South
African cents per E ordinary share, payable to employees participating in the
Bokamoso ESOP and Izingwe Holdings (Proprietary) Limited. These dividends were
paid on 28 August 2009.
20. Detailed report
This report contains a summary of the results of AngloGold Ashanti'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
R P EDEY M CUTIFANI
Chairman Chief Executive Officer
30 October 2009
Administrative information
AngloGold Ashanti Limited
Registration No. 1944/017354/06
Incorporated in the Republic of South Africa
Share codes:
ISIN: ZAE000043485
JSE: ANG
LSE: AGD
NYSE: AU
ASX: AGG
GhSE (Shares): AGA
GhSE (GhDS): AAD
Euronext Paris: VA
Euronext Brussels: ANG
JSE Sponsor: UBS
Auditors: Ernst & Young Inc
Offices
Registered and Corporate
76 Jeppe Street
Newtown 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 4602
Fax: +61 8 9425 4662
Ghana
Gold House
Patrice Lumumba Road
(PO Box 2665)
Accra
Ghana
Telephone: +233 21 772190
Fax: +233 21 778155
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
E-mail: jane.kirton@corpserv.co.uk
Directors
Executive
M Cutifani ~ (Chief Executive Officer)
S Venkatakrishnan * (Chief Financial Officer)
Non-Executive
R P Edey * (Chairman)
Dr T J Motlatsi (Deputy Chairman)
F B Arisman #
W A Nairn
Prof W L Nkuhlu
S M Pityana
* British # American
~ Australian South African
Officers
Company Secretary: Ms L Eatwell
Investor Relations Contacts
South Africa
Sicelo Ntuli
Telephone: +27 11 637 6339
Fax: +27 11 637 6400
E-mail: sntuli@AngloGoldAshanti.com
United States
Stewart Bailey
Telephone: +1-212-836-4303
Mobile: +1-646-717-3978
E-mail: sbailey@AngloGoldAshanti.com
General E-mail enquiries
investors@AngloGoldAshanti.com
AngloGold Ashanti website
http://www.AngloGoldAshanti.com
Company secretarial E-mail
Companysecretary@AngoGoldAshanti.com
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.
PRINTED BY INCE (PTY) LIMITED
Share Registrars
South Africa
Computershare Investor Services (Pty) Limited
Ground Floor, 70 Marshall Street
Johannesburg 2001
(PO Box 61051, Marshalltown 2107)
South Africa
Telephone: 0861 100 950 (in SA)
Fax: +27 11 688 5218
web.queries@computershare.co.za
United Kingdom
Computershare Investor Services PLC
The Pavilions
Bridgwater Road
Bristol BS99 7NH
England
Telephone: +44 870 702 0000
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 2949 (in Australia)
Fax: +61 8 9323 2033
Ghana
NTHC Limited
Martco House
Off Kwame Nkrumah Avenue
PO Box K1A 9563 Airport
Accra
Ghana
Telephone: +233 21 229664
Fax: +233 21 229975
ADR Depositary
The Bank of New York Mellon ("BoNY")
BNY Shareowner Services
PO Box 358016
Pittsburgh, PA 15252-8016
United States of America
Telephone: +1 800 522 6645 (Toll free in USA) or +1 201 680 6578 (outside USA)
E-mail: shrrelations@mellon.com
Website: www.bnymellon.com.com\shareowner
Global BuyDIRECTSM
BoNY maintains a direct share purchase and dividend reinvestment plan for
AngloGold Ashanti.
Telephone: +1-888-BNY-ADRS
Certain statements made in this communication, including, without limitation,
those concerning AngloGold Ashanti's strategy to reduce its gold hedging
position including the extent and effects of the reduction, the economic
outlook for the gold mining industry, expectations regarding gold prices,
production, cash costs and other operating results, growth prospects and
outlook of AngloGold Ashanti's operations, individually or in the aggregate,
including the completion and commencement of commercial operations of certain
of AngloGold Ashanti's exploration and production projects and completion of
acquisitions and dispositions, AngloGold Ashanti's liquidity and capital
resources, and expenditure and the outcome and consequences of any pending
litigation proceedings, contain certain forward-looking statements regarding
AngloGold Ashanti's operations, economic performance 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 other factors, changes in economic and market conditions, success of
business and operating initiatives, changes in the regulatory environment and
other government actions, fluctuations in gold prices and exchange rates, and
business and operational risk management. For a discussion of such factors,
refer to AngloGold Ashanti's annual report for the year ended 31 December 2008,
which was distributed to shareholders on 27 March 2009 and the company's annual
report on Form 20-F, filed with the Securities and Exchange Commission in the
United States on May 5, 2009 and amended on May 6, 2009. AngloGold Ashanti
undertakes no obligation to update publicly or release any revisions to these
forward-looking statements to reflect events or circumstances after today's
date or to reflect the occurrence of unanticipated events. 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. AngloGold Ashanti posts information that is important to investors on
the main page of its website at www.anglgoldashanti.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.
END
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