AngloGold 104 percent rise net profits in 4th quarter - 500 Beiträge pro Seite

[sum098]

AngloGold reports 104 percent rise in net profits for fourth quarter

1/31/2002 7:59:00 AM

JOHANNESBURG, South Africa, Jan 31, 2002 (AP WorldStream via COMTEX) -- AngloGold Ltd., the world`s largest gold producer, reported a 104 percent rise in net profits to 895 million rand (dlrs 78.5 million) in the fourth quarter ending Dec. 31, the company announced Thursday.

This compares with net profits of 439 million rand (dlrs 47 million) in the third quarter ending Sept. 30.

Net profits for the year were 2.18 billion rand (dlrs 191 million), up from 1.12 billion rand (dlrs 140 million) in 2000.

The increase in profits came as the value of the rand plunged 40 percent in 2001 against the dollar, the currency in which gold sales take place. The currency fell 20 percent in the fourth quarter.

Fourth-quarter headline earnings per share rose 97 percent to 9.06 rand (dlrs .79) a share from 4.59 rand (dlrs .40) a share the previous quarter.

The earnings were slightly weaker than expected.

AngloGold`s chairman and chief executive Bobby Godsell said that while production fell 4 percent, costs were well contained in local currency terms.

Godsell confirmed the company had reduced its overall hedging position during the quarter to reduce its exposure to the rand`s weakness.

Godsell also said AngloGold`s decision to withdraw from the bid for Australia`s Normandy Mining Ltd. was based on sound business logic.

AngloGold is 53.3 percent owned by Anglo American PLC.

[Friseuse]

Der Rand steigt schon wieder, damit sinken auch die Gewinne.

[hbbbh]

ja nun -- die grosse Frage ist eben wie es mit dem Gold- bzw- auch Silberpreis weitergeht. Steigt der POG dann macht eine Erholung des Rands bei Südafrika-Minenwerten wohl wenig aus. Seitwärtsbewegung und ein härterer Rand sprächen für einen Verkauf der Südafrika-Minenwerte, die ja in letzter Zeit ganz gut gelaufen sind.

Frage ... wessen Kristallkugel ist die beste ???

[sum098]

DJ. AngloGold Cuts Hedge Book By 19% In `01, More To Come >AU

1/31/2002 12:44:00 PM

LONDON, Jan 31, 2002 (ODJ via COMTEX) -- (Dow Jones)--South African-based gold producer AngloGold Ltd. (AU) said Thursday that it is looking to unwind further its controversial hedge book in order to take better advantage of market fundamentals.

"We will not add any gold hedges at this stage," said Kelvin Williams, AngloGold`s marketing director, in a conference call.

The company unwound hedges worth 3.4 million ounces, or 105 metric tons, in 2001, in response to the dramatic collapse of the South African rand and a broad upswing in the price of gold, Williams said.

That strategy will continue into 2002 so long as conditions remain favorable, he added.

Hedging is a controversial practice whereby mining companies can lock in guaranteed prices for their future production, principally by selling output forward in contracts to third parties. The advantage is that it gives mining companies greater certainty over future revenue and locked-in prices typically are above reigning spot prices. But critics say the exercise artificially depresses spot prices and hampers upward movement.

AngloGold is one of the industry`s biggest proponents of hedging and has improved consistently its earnings as the gold price wilted over the past decade.

But a turnaround in the gold price - to an average of the low $280s an ounce from the low $270s - and a 40% decline in the rand in 2001, forced AngloGold to cut its hedging exposure.

Its hedge book, or the amount of ounces committed for forward sale, shrank by almost 19% as a result of unwinding in 2001. Currently, Anglogold has 453 tons of gold hedged.

With the outlook for the gold price being "robust," AngloGold needed "less (income) protection" offered by hedging, Williams said.

AngloGold Chairman and Chief Executive Bobby Godsell said he didn`t expect the rand to repeat its woeful performance against major currencies in 2002.

Instead, he forecast an annual depreciation of closer to 5%-6% based on purchasing power parity, though initially the currency would appreciate toward ZAR11 to the dollar, from a current rate closer to ZAR11.50.

AngloGold is still the world`s biggest gold producer, but is expected to be leapfrogged by Denver-based Newmont Mining Corp. (NEM) after it completes a A$4.5 billion acquisition of Australia`s Normandy Mining Ltd. (A.NDY), possibly as early as next month

[gholzbauer]

Noch ein bißchen was zum Schmökern für`s Wochenende:


http://www.miningweekly.co.za/?show=18263

Godsell spurns value-diluting deals


The last quarter of the 2001 financial year for South Africa’s largest gold producer was dominated by the unsuccessful bid for Australian miner Normandy, as well as the sudden and significant depreciation of the rand.
At the company’s quarterly and 2001 year-end results AngloGold chairperson and CEO Bobby Godsell said that the disappointment of the Normandy bid is strongly tempered by a total commitment to only doing deals which grow, rather than dilute, the present and future value of the company.

However, the unsuccessful Normany bid has left many observers wondering where AngloGold will turn to in order to achieve growth.

Godsell stated that managements objective was to grow the company into the global-gold investments of choice and to offer its shareholders thoroughly competitive returns against investments in any category and he presented a combination of six growth strategies.

Firstly, by driving the company down the cost curve.

Through a combination of dramatic changes to the asset base, productivity improvements and movements in currency, cash costs have improved from $250 an ounce in the March quarter of 1998 to $159 an ounce in the December quarter of 2001.

The sale of the Free State assets will reduce this even further.

The second avenue of growth will be organic.

There are five significant projects under way that will contribute 15-million low-cost ounces to the group over the life of the projects.

Brownfield exploration will provide for additional growth.

In the last two years AngloGold has generated five-million reserve ounces through brownfield exploration at a discovery cost of below $10 an ounce, which is internationally competitive.

The fourth growth path is based on highly-focused greenfelds exploration where 13-million new production ounces, with discovery cost of below $30 an ounce, have been targeted between now and 2015.

Godsell suggests that, in the next few years, AngloGold will do the same for exploration as it has already done for productivity in the past.

“Targets have been set giving investors and analysts a chance to measure our exploration activities and performance,” Godsell stated.

He identifies acquisitions as the fifth avenue of growth.

Since 1998 the company has acquired assets which produced 2,3-million low-cost ounces for the year under review and contributed 37% to operating profit and 57% of cash earnings.

“We will energetically continue to pursue acquisitions of orebodies as well as companies where they will add value to AngloGold,” assures Godsell.

The final avenue for growth is the least developed, but holds enormous promise.

“As important as value-adding consolidation may be in the mining of gold, so too is consolidation of downstream sectors,” states Godsell.

Gold jewellery, from refining though to retail is fragmented, undercapitalised and in many areas wasteful and inefficient.

Anglo has two modest investments downstream from which a great deal has been learnt about bullion trading, manufacturing and retail.

Again, Godsell commits Anglo Gold to investment opportunities of scale where compelling commercial strategies are presented.

In summary to the financial results AngloGold’s strong first three quarters of 2001 created a tough base for quarter four.

Nearly half of the company’s earnings come from outside South Africa and are therefore unaffected by the rand:dollar exchange rate.

Seen in this light the improved earning and returns in the fourth quarter represent an impressive performance.

Meanwhile, Reuters reported that tight cost controls and a slumping local currency helped it to increase profits for the last three months of 2001 and the year as a whole.

Johannesburg-based AngloGold said headline earnings before unrealised hedging activities rose 45% to R924-million in the fourth quarter from R637-million in the third quarter to end-September.

Headline earnings for 2001 improved to R2,5-billion in 2001 from R1,8-billion the year before.

Headline earnings strip out exceptional items and their tax effects.

Analysts said the results were ahead of expectations.

“My initial thought is that these are excellent results, especially on the cost side, with cash costs going sub-$160/oz.

This puts it in the competitive park of North American producers,” said UBS Warburg analyst Leon Esterhuizen.

Godsell said he was pleased with the fourth quarter performance.

While gold output fell four per cent to 53,471 kg – due mainly to poor production from North America and two mines in South Africa – costs were contained in local currency terms and fell sharply in dollar terms.

“With the 20% fall of the rand over the quarter, dollar-denominated total cash costs were dramatically reduced by $17 an ounce to $159 an ounce,” Godsell said in a statement.

He said cost controls and the weaker rand fuelled a 43% jump in fourth quarter operating profit to R1,6-billion, and a 41% gain to R4,6-billion in 2001.

AngloGold forecast gold output of 5,8-million ounces in 2002, down from nearly seven-million ounces last year.

It forecast cash costs of $154 an ounce this year, compared to $178 an ounce in 2001.

Capital expenditure in 2002 was forecast at $268-million, down from $298-million a year earlier.

AngloGold, which has sold forward part of its South African production in rand-denominated contracts for many years, said the sharp drop in the rand required active management of that portion of the hedge book priced in rands.

“Clearly the extent of these rand-priced contracts has limited the extent of the benefit derived by AngloGold from the significantly lower rand:dollar exchange rate,” Godsell said.

AngloGold said its hedge book was now less exposed to further declines in the local currency and, going forward, management intends to continue to reduce the rand component of its forward contracts.

Warrick Lace

[Schalom_qed]

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