AngloGold Limited
Registration No. 1944/017354/06
Incorporated in the Republic of South Africa
Code: ANG ISIN: ZAE000014601
Report to Shareholders
Group results for the quarter and nine months ended 30 September 2002
* Headline earnings1 up 16% ($14m) to $101m or 91 US cents per share
* Operating profit2 up 7% to $174m and net profit up $2m to $81m
* Total cash costs down 2% to $158/oz, despite increased labour costs in
South Africa and the consequences of seismicity at Great Noligwa
* Gold production up 11% quarter-on-quarter to 1.6Moz, assisted by a
substantial rise in production at Morila resulting from a short-term improvement
in grade and the increased stake in Cerro Vanguardia
* The Geita reserve increases by 24% to 4.8Moz (attributable) following a
successful drilling programme
* Further reduction in the hedge book, despite the additional forward contracts
acquired with the increased stake in Cerro Vanguardia. The rate of decline in
the book slows, as expected
* Return on equity and capital employed of 23% and 17% respectively
Quarter Quarter 9 mths 9 mths
ended ended ended ended
Sept 02 Jun 02 Sept 02 Sept 01
Dollar/Imperial
Gold
Produced - oz (000)/kg 1,587 1,426 4,390 5,264
Price received2 - $/oz /R/kg 305 305 299 290
Total cash costs - $/oz /R/kg 158 161 157 184
Total production costs
- $/oz /R/kg 202 201 197 220
Operating profit - $/R million 161 124 404 369
Operating profit
including realised
non-hedge derivatives
- $/R million 174 162 483 376
Net profit - $/R million 81 79 231 159
Headline earnings - $/R million 88 87 268 186
Headline earnings
before unrealised
non-hedge derivatives
- $/R million 101 87 277 198
Capital expenditure
- $/R million 64 67 182 217
Net earnings (basic)
- cents per share 73 71 208 149
Headline earnings - cents per share 79 79 242 174
Headline earnings
before unrealised
non-hedge derivatives
- cents per share 91 79 250 185
Dividends - cents per share 133 85
Quarter Quarter 9 mths 9 mths
ended ended ended ended
Sept 02 Jun 02 Sept 02 Sept 01
Rand/Metric
Gold
Produced - oz (000)/kg 49,358 44,369 136,543 163,732
Price received2 - $/oz /R/kg 102,267 102,498 103,567 75,378
Total cash costs - $/oz /R/ 52,751 54,177 54,242 47,887
Total production costs
- $/oz /R/kg 67,637 67,645 68,270 57,164
Operating profit - $/R million 1,687 1,304 4,350 2,995
Operating profit
including realised
non-hedge derivatives
- $/R million 1,822 1,687 5,205 3,045
Net profit - $/R million 850 828 2,489 1,285
Headline earnings - $/R million 925 903 2,899 1,504
Headline earnings
before unrealised
non-hedge derivatives
- $/R million 1,062 905 2,996 1,611
Capital expenditure
- $/R million 665 709 1,962 1,755
Net earnings (basic)
- cents per share 767 748 2,245 1,200
Headline earnings - cents per share 834 815 2,615 1,405
Headline earnings
before unrealised
non-hedge derivatives
- cents per share 958 817 2,702 1,504
Dividends - cents per share 1,350 700
1 Headline earnings before unrealised non-hedge derivatives
2 Operating profit and price received includes realised non-hedge derivatives
$ represents US dollar, unless otherwise stated
Letter from Chairman and CEO
Dear Shareholder
AngloGold has produced a good set of results for the third quarter of 2002.
The latest consensus view of the analysts covering the South African and global
gold equity markets has been that rising costs in South Africa over the quarter
would have a serious impact on producers` results in this country. However, the
wide diversity of AngloGold`s operations has had the effect of offsetting the
impact of inflation and reduced grades, allowing the company to deliver an 11%
increase in gold production, a 16% improvement in headline earnings and a 2%
decrease in total cash costs. Although the South African operations overall did
suffer from increasing costs and a slower mining rate at Great Noligwa following
the seismic damage of the second quarter, this was partially compensated for by
the good performance of other South African mines. At Morila, gold production
was dramatically higher as mining intersected a localised area of very high
grade in the open pit.
Management`s determination to improve safety in the company`s operations has
been increased with pleasing results. The company`s lost time injury frequency
rate (LTIFR) per million hours worked for this quarter stands at 8.4 (or 1.7 per
200,000 hours worked). Although much work remains to be done to further improve
this performance, this measure is within range of our benchmark Ontario
underground metalliferous mines` LTIFR of 6.5 and better than the comparable
figure for Australian mines of 9.
At the Mining Investment Forum in Denver, Colorado, earlier this month,
AngloGold made the point that the gold companies that are going to attract the
attention of investors looking for good returns are likely to be those which can
produce sound results and which have a realistic growth strategy to allow them
to take advantage of the stronger market for our product. In this report, there
is a summary of AngloGold`s immediate and longer-term growth opportunities.
Management anticipates that the projects envisaged here could yield an
additional 16.5 million ounces of gold, adding to the lives of existing
operations and supplementing the 15 million ounces expected from the current
five organic growth projects under way or recently completed. The company will
keep shareholders informed of the details of these prospective projects as they
progress further.
When the South African Government`s Socio-Economic Empowerment Charter for
the mining industry was unveiled earlier this month, we said that we believed
that it succeeded in establishing the right balance between this country`s
political imperatives and the need for a growing, profitable mining industry to
capitalise on South Africa`s wealth potential. We believe that the market`s
response to the Charter has vindicated this view and we are committed to
achieving the Charter`s objectives. There will be continuing uncertainty
however, until both the scorecard and the related Money Bill have been finalised
and made public.
The Company will be holding a shareholders` meeting on 5 December 2002 to
vote on a number of resolutions. One of these involves the adoption of a new
Memorandum and Articles of Association to bring the Company in line with the
amended Companies Act and various regulatory and corporate governance
requirements. We are also proposing a two for one split of our ordinary shares
and an offer to buy back or top up odd lots of shares. A circular setting out
the details of these resolutions will be sent to shareholders early in November.
Russell Edey Bobby Godsell
Chairman Chief Executive Officer
30 October 2002
Continuing the growth story
Approved capital projects
AngloGold currently has the five capital projects listed below in
development. Two of these projects (Sunrise Dam in Australia and Cripple Creek
and Victor in the USA) are now complete, with the other three (Mponeng, TauTona
and Moab Khotsong in South Africa) on track for completion on time and within
budget. Together, these five projects will yield some 15 million additional
ounces of gold production over their lives.
Incremental Capex Cash Cost Life of Mine
ounces Total Remaining
Sunrise Dam 2.1Moz A$96m Nil $175/oz + 5 years to
Australia 2009
Mponeng 3.0Moz R1.3bn R485m $158/oz + 5 years to
South Africa 2012
Tau Tona 2.7Moz R460m R330m $139/oz + 6 years to
South Africa 2013
CC&V 2.8Moz $194m $73m $176/oz + 4 years to
North America 2013
Moab Khotsong 4.5Moz R3.8bn R1.1bn $102/oz 2015
South Africa
Growth opportunities in South Africa
In South Africa, the dramatically higher rand price of gold has contributed
to a further 11 million additional ounces of gold to reserves, resulting in the
possible development of six deep-level mining projects, currently being studied.
Project Additional gold production
TauTona: VCR shaft pillar and 66 level, area "A" 0.3Moz
TauTona: CLR 120-125 level and 116 level (east of Bank Dyke) 1.4Moz
Tau Lekoa: above 900 level 0.2Moz
Moab Khotsong phase 2: below 101 level 4.6Moz
Mponeng VCR: 120-125 level 1.3Moz
Mponeng lower-grade VCR and CLR 3.2Moz
Opportunities elsewhere
In addition, AngloGold is studying the feasibility of two other ventures:
which are outlined in the table below, and have the capacity to add another 5.5
million ounces of gold to AngloGold`s production base.
Project Additional gold production
CuiabX expansion, Brazil 1.9Moz
Boddington expansion, Western Australia 3.6Moz attributable
Review of the gold market
At $314/oz, the average spot price of gold for the quarter was slightly
higher than that for the previous quarter. The market remained volatile with a
price trading range of some $26 for the period. Whilst the price moved upwards
steadily from early August, and closed around the high of $327.50 for the
quarter, the market corrected in October, with the price falling to $310/oz.
This move repeated the pattern of the past six months, where buying on the New
York Comex has driven the spot price. Buying has largely disappeared above a net
long position of approximately 10Moz on the exchange, and profit taking has
followed. The exchange is now net long some 4Moz, providing the opportunity for
fresh buying when circumstances become favourable.
The dollar has traded within a narrow range against the euro for most of the
quarter, with little impact on the gold price. Instead, gold buying was driven
by sustained losses in the equity markets, and by renewed international
political tension. Whilst the conflicts between Israel and Palestine and between
India and Pakistan now seem to be factored into the gold price, these concerns
have been supplemented by the danger of war in Iraq as a risk driving investor
interest in gold.
The negative impact on the physical market for gold of price volatility and
higher spot prices, has been felt throughout this year. Physical demand has also
not been helped by a fragile world economy. The important Indian market has
responded particularly badly to these circumstances, with offtake for the first
half of 2002 down by between 40% and 50% on the same period last year. Globally,
jewellery offtake looks to be some 16% down in the first half of 2002, and
industrial offtake 5-6% down. Compounding this unfavourable move, higher prices
have also triggered dishoarding, and a sharp rise in scrap sales which could
increase by as much as 30% to over 800t of sales this year. However, late
September and early October have seen a return of stronger demand from India,
driven in part by seasonal circumstances, and the last quarter of the year
should also see good demand for gold for jewellery fabrication in the developed
market.
During the quarter under review, the company, on a delta basis, absorbed a
further 331,000oz or 10t of hedge contracts in its acquisition of an additional
46.25% of Cerro Vanguardia. Notwithstanding this additional short position, the
net hedge position at the end of September was 10.4Moz (326.6t), slightly down
from the position at the end of the previous quarter. By the fourth week of
October, this position had fallen to some 10.1Moz or 314t with a net marked to
market value of negative $341m.
Kelvin Williams
Marketing Director
Hedging overview
In the process of delivering consistent financial returns to its
shareholders, AngloGold manages its revenue risk through an actively directed
forward sales program, while simultaneously seeking to ensure that the company
still derives a measure of significant benefit in the event that the spot gold
price should rise.
The Board has given management a mandate is to sell forward no more than 50%
of five years` production, spread over a ten year period. AngloGold has seldom
been close to this limit, and then mainly through acquisitions and debt
financing of new assets where the terms of loans have required that a portion of
production from these assets is sold forward. With reduced operational risk and
a more positive outlook on the gold market, for the past five quarters the
company has steadily reduced its hedge book. The current net level of cover is
equivalent to some 30% of five years` production.
AngloGold`s forward sales contracts over the next ten years are summarised in
the following table and graph. For a more detailed description of the hedge
book, please refer to the table mentioned under "Hedge Position" in this report.
(See press for table.)
Total
Rand Gold US$ Gold A$ Gold Total Kilograms Total Ounces
kg Sold kg Sold kg Sold Sold Sold
12 Month ending
2002 336 3,774 1,703 5,140 165,268
2003 21,499 25,567 12,064 59,129 1,901,052
2004 16,018 26,126 5,443 47,587 1,529,960
2005 14,367 33,202 4,900 52,468 1,686,899
2006 9,837 26,752 5,558 42,147 1,355,064
2007 - 2011 17,377 88,038 11,691 117,105 3,765,014
Total 78,761kg 203,459kg 41,358kg 323,578kg 10,403,258oz
HEDGE POSITION AT 30 SEPTEMBER 2002
As at 30 September 2002, the group had outstanding, the following forward-
pricing commitments against future production. The total net delta tonnage of
the hedge on this date was 10.40Moz or 323.6t (at 30 June 2002: 10.53Moz or
327.5t).
The marked-to-market value of all hedge transactions making up the hedge
positions was a negative R4.65bn (negative $442.3m) as at 30 September 2002 (at
30 June 2002: negative R4.38bn - negative $422.81m). These values were based on
a gold price of $322.75 per ounce, exchange rates of R/$10.51 and A$/$0.54 and
the prevailing market interest rates and volatilities at the time.
As at 29 October 2002, the marked-to-market value of the hedge book was a
negative R3.42bn (negative $341.06m) based on a gold price of $315.5/oz and
exchange rates of R/$10.04 and A$/$0.557 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 cost of buying all hedge contracts at the time of
valuation, at market prices and rates available at that time.
Year 2002 2003 2004 2005 2006 2007-2011 Total
DOLLAR GOLD
Forward Contracts
Amount (kg) 18,875 24,699 23,183 17,828 46,420 131,005
$ per oz $313 $312 $321 $326 $348 $328
Put Options Purchased
Amount (kg) 1,276 5,808 2,662 757 563 728 11,794
$ per oz $368 $352 $390 $291 $291 $292 $352
*Delta (kg) 945 3,605 1,871 178 126 155 6,880
Put Options Sold
Amount (kg) 14,307 12,752 8,087 35,146
$ per oz $317 $307 $339 $318
*Delta (kg) 4,146 3,930 3,859 11,935
Call Options Purchased
Amount (kg) 2,518 4,555 572 7,645
$ per oz $358 $351 $360 $354
*Delta (kg) 512 1,536 199 2,247
Call Options Sold
Amount (kg) 13,894 16,653 6,998 16,286 14,615 68,356 136,802
$ per oz $327 $331 $333 $322 $329 $358 $343
*Delta (kg) 7,487 8,553 3,614 9,841 8,798 41,463 79,756
RAND GOLD
Forward Contracts
Amount (kg) 2,129 17,359 12,476 11,255 6,335 8,274 53,569
Rand per kg R100,163 R84,309 R98,531 R123,852 R120,898 R117,021 R104,679
Put Options Purchased
Amount (kg) 2,283 1,875 1,875 1,875 1,875 9,783
Rand per kg R90,079 R93,603 R93,603 R93,603 R93,603 R92,780
*Delta (kg) 20 101 59 23 14 217
Put Options Sold
Amount (kg) 1,866 1,866
Rand per kg R108,204 R108,204
*Delta (kg) 622 622
Call Options Purchased
Amount (kg) 500 500
Rand per kg R81,751 R81,751
*Delta (kg) 500 500
Call Options Sold
Amount (kg) 2,916 4,687 4,688 4,687 4,688 14,930 36,596
Rand per kg R88,617 R99,370 R115,285 R131,945 R132,648 R202,056 R150,880
*Delta (kg) 2,895 4,039 3,483 3,089 3,488 9,103 26,097
AUS DOLLAR (A$) GOLD
Forward Contracts
Amount (kg) 1,717 12,286 5,443 6,221 9,331 22,395 57,393
A$ per oz A$653 A$520 A$535 A$657 A$628 A$602 A$590
Call Options Purchased
Amount (kg) 4,354 3,888 3,110 6,221 15,863 33,436
A$ per oz A$715 A$701 A$724 A$673 A$692 A$696
*Delta (kg) 116 1,170 1,321 3,773 10,704 17,084
Call Options Sold
Amount (kg) 1,555 3,110 4,665
A$ per oz A$599 A$700 A$666
*Delta (kg) 841 948 1,789
Put Options Sold
Amount (kg) 3,421 3,421
A$ per oz A$566 A$566
*Delta (kg) 739 739
Total Net Gold:
Delta (kg) 5,140 59,129 47,587 52,468 42,147 117,105 323,578
Delta (oz) 165,268 1,901,049 1,529,958 1,686,897 1,355,063 3,765,009 10,403,244
RAND DOLLAR (000)
Forward Contracts
Amount ($) 53,556 53,556
Rand / $ R11.09 R11.09
Put Options Purchased
Amount ($)
Rand per $
*Delta ($)
Put Options Sold
Amount ($) 10,000 10,000
Rand per $ R10.50 R10.50
*Delta ($) 4,067 4,067
Call Options Purchased
Amount ($)
Rand per $
*Delta ($)
Call Options Sold
Amount ($) 10,000 10,000
Rand per $ R10.80 R10.80
*Delta ($) 2,889 2,889
AUS DOLLAR (000)
Forward Contracts
Amount ($) 16,548 29,428 15,970 10,847 72,793
$ per A$ A$0.66 A$0.59 A$0.64 A$0.51 A$0.61
*The delta position indicated reflects the nominal amount of the option
multiplied by the mathematical probability of the option being exercised. This
is calculated using the Black and Scholes option formula with the ruling market
prices, interest rates and volatilities as at 30 September 2002.
Operations at a glance - Diversified risk
EBITDA Operating profit Total cash costs Production
$m % Variance $m % Variance $/oz % Variance oz (000) % Variance
Morila* 42 282 31 343 49 (55) 171 185
Great
Noligwa 33 (23) 31 (26) 136 20 210 (10)
TauTona 28 22 26 18 131 (3) 168 14
Mponeng 18 50 10 43 170 (8) 137 30
Sunrise
Dam 17 (6) 12 (8) 170 1 105 3
Kopanang 15 (6) 13 (13) 178 14 129 4
Cripple Creek
& Victor* 12 20 - - 184 (5) 57 19
Geita* 11 22 7 17 167 (1) 82 6
Morro
Velho 11 10 8 14 122 (12) 54 6
Tau Lekoa 7 (13) 5 (17) 201 5 77 1
Cerro
Vanguardia*7 75 7 75 103 (6) 51 76
Sadiola* 5 (38) 2 (50) 172 19 40 (9)
Serra
Grande* 5 (17) 4 - 90 (17) 24 -
Ergo 4 (50) 4 (43) 196 9 62 (5)
Yatela* 4 33 3 50 174 (2) 30 36
Navachab 4 33 4 33 141 (14) 23 15
Jerritt
Canyon* 3 (50) (2) (100) 271 22 57 (14)
Union Reefs 3 50 2 100 205 (8) 29 (9)
Savuka 2 (67) 1 (80) 265 28 57 (20)
* Attributable
NOTES
The results included herein for the quarter and nine months ended
30 September 2002, which are unaudited, have been prepared using the accounting
policies which are in accordance with the standards issued by the International
Accounting Standards Board and the South African Institute of Chartered
Accountants. The Group`s accounting policies are consistent with those applied
in the previous periods. Where appropriate, comparative figures have been
restated.
1. During the quarter, 20,600 ordinary shares were allotted in terms of the
AngloGold Share Incentive Scheme, 1,225 ordinary shares were allotted in terms
of the Acacia Employee Option Plan and 19 ordinary shares were allotted in terms
of the Normandy offer.
2. Orders placed and outstanding on capital contracts as at 30 September 2002
totalled R1,067m (30 June 2002: R990m), equivalent to $101m (30 June 2002: $95m)
at the rate of exchange ruling on that date.
3. Although AngloGold holds a 66.7% interest in Cripple Creek & Victor Gold
Mining Company Limited, it is currently entitled to receive 100% of the cash
flow from the operation until a loan, extended to the joint venture by AngloGold
North America Inc., is repaid.
4. Dividend
Interim Dividend No. 92 of 1,350 South African cents per ordinary share was paid
to registered shareholders on 30 August 2002, while a dividend of 24.3405
Australian cents per CHESS Depositary Interest (CDI) was paid on the same day.
Each CDI represents one-tenth of an ordinary share. A dividend was paid to
holders of American Depositary Receipts (ADRs) on 10 September 2002 at a rate of
63.81 US cents per American Depositary Share (ADS). Each ADS represents one-
half of an ordinary share.
5. The board of directors is proposing the adoption of a new Memorandum and
Articles of Association. In addition, it is proposed that an odd-lot offer be
made to shareholders and that each ordinary share be sub-divided into two
ordinary shares. An announcement in this regard will be published shortly and a
circular, which provides full details and includes notice of a general meeting
to be held on 5 December 2002 to approve the aforementioned, will be posted to
shareholders, together with the quarterly report, on or about 8 November 2002.
6. This report contains a summary of the results of AngloGold`s operations. A
detailed report appears on the Internet at www.anglogold.com 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 R M GODSELL
Chairman Chief Executive Officer
30 October 2002
GROUP INCOME STATEMENT
Quarter Quarter Nine months Nine months
ended ended ended ended
September June September September
SA Rand million 2002 2002 2002 2001
Gold income 5,015 4,252 13,558 12,521
Gold sales 5,069 5,069 3,553 3,710
Realised gain (loss) on
hedging instruments - - - -
Unrealised gain (loss) on
hedging activities - - - -
Cost of sales (3,328) (2,948) (9,208) (9,526)
Cash operating costs 2,569 2,359 7,305 7,722
Other cash costs 84 60 201 181
Total cash costs 2,653 2,419 7,506 7,903
Retrenchment costs 5 11 30 153
Rehabilitation and other
non-cash costs 20 11 46 69
Production costs 2,678 2,441 7,582 8,125
Amortisation of mining assets 733 598 1,908 1,346
Total production costs 3,411 3,039 9,490 9,471
Inventory change (83) (91) (282) 55
Operating profit 1,687 1,304 4,350 2,995
Realised non-hedge derivative gain 135 383 855 50
Operating profit including
realised non-hedge derivatives 1,822 1,687 5,205 3,045
Corporate administration
and other expenses (72) (59) (185) (147)
Market development costs (46) (44) (134) (94)
Exploration costs (90) (73) (233) (152)
Interest receivable 84 111 288 114
Other net (expense) income (41) 2 (54) 4
Finance costs (105) (127) (364) (465)
Unrealised non-hedge
derivative (loss) gain (256) 5 (179) (173)
Abnormal item - settlement
of legal claim - (102) (102) -
Profit before exceptional items 1,296 1,400 4,242 2,132
Amortisation of goodwill (73) (72) (226) (170)
Debt written-off - - - (21)
Impairment of mining assets - - - (3)
Loss on disposal of assets (2) (5) (139) (31)
Termination of retirement
benefit plans - 2 2 -
Profit on ordinary activities
before taxation 1,221 1,325 3,879 1,907
Taxation (328) (464) (1,284) (573)
Normal and deferred taxation (447) (504) (1,366) (645)
Deferred tax on unrealized
non-hedge derivatives 119 (7) 82 66
Taxation on abnormal item - 47 47 -
Taxation on exceptional items - - (47) 6
Profit on ordinary activities
after taxation 893 861 2,595 1,334
Minority interest (43) (33) (106) (49)
Net profit 850 828 2,489 1,285
Headline earnings
The net profit has been adjusted
by the following to
arrive at headline earnings:
Net profit 850 828 2,489 1,285
Amortisation of goodwill 73 72 226 170
Debt written-off - - - 21
Impairment of mining assets - - - 3
Loss on disposal of assets 2 5 139 31
Termination of retirement benefit plans - (2) (2) -
Taxation on exceptional items - - 47 (6)
Headline earnings 925 903 2,899 1,504
Unrealised non-hedge
derivative loss (gain) 256 (5) 179 173
Deferred tax on unrealized
non-hedge derivatives (119) 7 (82) (66)
Headline earnings before
unrealised non-hedge derivatives 1,062 905 2,996 1,611
Earnings per ordinary share - cents
- Basic 767 748 2,245 1,200
- Headline 834 815 2,615 1,405
- Headline before unrealised
non-hedge derivatives 958 817 2,702 1,504
Dividends declared
- Rm 1,506 751
- cents per share 1,350 700
The results are unaudited and prepared in accordance with International
Accounting Standards.
Quarter Quarter Nine months Nine months
ended ended ended ended
September June September September
US Dollar million 2002 2002 2002 2001
Gold income 481 406 1 260 1 548
Gold sales 5 069 5 069 3 553 3 710
Realised gain on hedging
instruments - - - -
Unrealised loss on hedging activities - - - -
Cost of sales ( 320) ( 282) ( 856) (1 179)
Cash operating costs 247 226 679 956
Other cash costs 8 6 18 23
Total cash costs 255 232 697 979
Retrenchment costs 1 1 3 19
Rehabilitation and
other non-cash costs 2 1 4 8
Production costs 258 234 704 1 006
Amortisation of mining assets 70 57 178 167
Total production costs 328 291 882 1 173
Inventory change ( 8) ( 9) ( 26) 6
Operating profit 161 124 404 369
Realised non-hedge derivative gain 13 38 79 7
Operating profit including
realised non-hedge derivatives 174 162 483 376
Corporate administration
and other expenses ( 7) ( 7) ( 17) ( 18)
Market development costs ( 4) ( 4) ( 12) ( 12)
Exploration costs ( 9) ( 7) ( 22) ( 19)
Interest receivable 8 11 27 14
Other net (expense) income ( 4) 1 ( 5) -
Finance costs ( 10) ( 12) ( 34) ( 58)
Unrealised non-hedge
derivative (loss) gain ( 24) 1 ( 17) ( 19)
Abnormal item - settlement
of legal claim - ( 10) ( 10) -
Profit before exceptional items 124 135 393 264
Amortisation of goodwill ( 7) ( 7) ( 21) ( 21)
Debt written-off - - - ( 3)
Impairment of mining assets - - - -
Loss on disposal of assets - ( 1) ( 12) ( 4)
Termination of retirement benefit plans - - - -
Profit on ordinary activities
before taxation 117 127 360 236
Taxation ( 32) ( 44) ( 119) ( 71)
Normal and deferred taxation ( 43) ( 48) ( 128) ( 79)
Deferred tax on unrealized
non-hedge derivatives 11 ( 1) 8 7
Taxation on abnormal item - 5 5 -
Taxation on exceptional items - - ( 4) 1
Profit on ordinary activities
after taxation 85 83 241 165
Minority interest ( 4) ( 4) ( 10) ( 6)
Net profit 81 79 231 159
Headline earnings
The net profit has been adjusted
by the following to
arrive at headline earnings:
Net profit 81 79 231 159
Amortisation of goodwill 7 7 21 21
Debt written-off - - - 3
Impairment of mining assets - - - -
Loss on disposal of assets - 1 12 4
Termination of retirement benefit plans - - - -
Taxation on exceptional items - - 4 ( 1)
Headline earnings 88 87 268 186
Unrealised non-hedge
derivative loss (gain) 24 ( 1) 17 19
Deferred tax on unrealized
non-hedge derivatives ( 11) 1 ( 8) ( 7)
Headline earnings before
unrealised non-hedge derivatives 101 87 277 198
Earnings per ordinary share - cents
- Basic 73 71 208 149
- Headline 79 79 242 174
- Headline before unrealised
non-hedge derivatives 91 79 250 185
Dividends declared
- $m 148 91
- cents per share 133 85
The results are unaudited and prepared in accordance with International
Accounting Standards.
GROUP BALANCE SHEET
Sept June Sept Sept June Sept
2002 2002 2001 2002 2002 2001
SA Rand million US Dollar million
ASSETS
Non-current assets
21,845 20,382 20,737 Mining assets 2,071 1,965 2,297
4,012 4,093 3,244 Goodwill 380 395 359
154 171 149 Investments in associates 15 17 16
201 178 65 Other investments 19 17 7
238 227 365 AngloGold Environmental 23 22 40
Rehabilitation Trust
505 492 195 Other non-current assets 48 47 22
26,955 25,543 24,755 2,556 2,463 2,741
Current assets
3,645 3,508 1,537 Cash and cash equivalents 346 338 170
2,428 2,801 2,249 Financial derivatives 230 270 249
2,464 2,575 1,447 Trade and other receivables 234 248 160
2,200 1,975 1,648 Inventories 209 190 183
4 4 169 Current portion of - - 19
other non-current assets
10,741 10,863 7,050 1,019 1,046 781
37,696 36,406 31,805 Total assets 3,575 3,509 3,522
EQUITY AND LIABILITIES
12,804 13,498 10,649 Shareholders` equity 1,216 1,300 1,178
402 317 263 Minority interests 38 31 29
13,206 13,815 10,912 1,254 1,331 1,207
Non-current liabilities
9,106 7,595 3,416 Borrowings 863 732 378
2,118 2,053 2,190 Provisions 201 198 243
2,977 2,919 3,431 Deferred taxation 282 282 380
14,201 12,567 9,037 1,346 1,212 1,001
Current liabilities
5,498 5,489 3,278 Financial derivatives 521 529 363
2,470 2,339 2,352 Trade and other payables 234 225 261
990 1,174 5,660 Current portion of borrowings 94 113 627
1,331 1,022 566 Taxation 126 99 63
10,289 10,024 11,856 975 966 1,314
37,696 36,406 31,805 Total equity and liabilities 3,575 3,509 3,522
The results are unaudited and prepared in accordance with International
Accounting Standards.
GROUP CASH FLOW STATEMENT
Nine Nine
Quarter Quarter months Quarter Quarter months
ended ended ended ended ended ended
Sept June Sept Sept June Sept
2002 2002 2002 2002 2002 2002
SA Rand million US Dollar million
Cash flows from operating
activities
2,664 1,399 6,150 Cash generated from operations 266 129 570
74 95 258 Interest received 7 9 24
(27) (35) (105) Environmental contributions (3) (3) (10)
and expenditure
19 - 19 Dividends received from associates 2 - 2
(108) (109) (333) Finance costs (10) (11) (31)
(48) (815) (932) Mining and normal taxation paid (6) (74) (86)
(1,569) - 2,792) Dividends paid (148) - (257)
1,005 535 2,265 Net cash inflow from 108 50 212
operating activities
Cash flows from
investing activities
(665) (709) (1,962) Capital expenditure (64) (67) (182)
- 1,554 1,554 Net proceeds from - 141 141
disposal of mines
- 1,819 1,819 Proceeds - 164 164
- (265) (265) Contractual obligations - (23) (23)
- (88) (356) Investments acquired - (9) (33)
5 3 1,834 Proceeds from sale of investments - - 159
(979) - (979) Acquisition of subsidiary (97) - (97)
(2) (4) (49) Loans advanced - - (5)
- 131 151 Repayment of loans advanced - 12 14
(1,641) 887 193 Net cash (outflow) inflow (161) 77 (3)
from investing activities
Cash flows from
financing activities
5 16 89 Proceeds from issue - 2 8
of share capital
(3) (3) (116) Share issue expenses - (1) (11)
2,536 1,522 8,520 Proceeds from borrowings 245 158 789
(1,755) (3,109) (9,339) Repayment of borrowings (175) (301) (865)
783 (1,574) (846) Net cash inflow (outflow) 70 (142) (79)
from financing activities
147 (152) 1,612 Net increase (decrease) 17 (15) 130
in cash and cash equivalents
(10) (134) (251) Translation (9) 19 25
3,508 3,794 2,284 Opening cash and cash equivalents 338 334 191
3,645 3,508 3,645 Closing cash and cash equivalents 346 338 346
The results are unaudited and prepared in accordance with International
Accounting Standards.
NOTES TO THE CASH FLOW STATEMENT
Nine Nine
Quarter Quarter months Quarter Quarter months
ended ended ended ended ended ended
Sept June Sept Sept June Sept
2002 2002 2002 2002 2002 2002
SA Rand million US Dollar million
Cash generated from operations
1,221 1,325 3,879 Profit on ordinary activities 117 127 360
before taxation
Adjusted for:
12 (104) (147) Non-cash movements 1 (10) (14)
(102) 102 - Abnormal item (10) 10 -
733 598 1,908 Amortisation of mining assets 70 57 178
(84) (111) (288) Interest receivable (8) (11) (27)
(1) (9) (12) Other net income - (1) (1)
105 127 364 Finance costs 10 12 34
230 47 179 Movement on non-hedge derivatives 22 5 17
73 72 226 Amortisation of goodwill 7 7 21
- - - Debt written off - - -
- - - Impairment of mining assets - - -
- - - Impairment reversal of - - -
investments
2 5 86 Loss on disposal of assets - 1 8
- (2) (2) Termination of retirement - - -
benefit plans
475 (651) (43) Movement in working capital 57 (68) (6)
2,664 1,399 6,150 266 129 570
Movement in working capital:
425 158 240 Decrease (increase) in trade 44 (4) 2
and other receivables
(155) (51) (253) Increase in inventories (11) (21) (46)
205 (758) (30) Increase (decrease) in trade 24 (43) 38
and other payables
475 (651) (43) 57 (68) (6)
STATEMENT OF CHANGES IN SHAREHOLDERS` EQUITY
Ordinary Non - Foreign Other Retained Total
share distri- currency compre- earnings
capital and butable translation hensive
premium reserves income
US Dollar million
Balance at
31 December 2001 681 12 250 (88) 262 1,117
Movement
on other
comprehensive
income (92) - (92)
Net profit 231 231
Dividends paid (254) (254)
Ordinary
shares issued 129 129
Transfer from
non-distributable
reserves (1) 1 -
Translation 94 2 (46) 35 85
Balance at
30 September 2002 904 13 204 (180) 275 1,216
SA Rand million
Balance at
31 December 2001 8,140 143 2,999 (1,057) 3,132 13,357
Movement
on other
comprehensive
income (841) (841)
Net profit 2,489 2,489
Dividends paid (2,728) (2,728)
Ordinary
shares issued 1,397 1,397
Transfer from
non-distributable
reserves (6) 6 -
Translation (870) - (870)
Balance at
30 September 2002 9,537 137 2,129 (1,898) 2,899 12,804
The results are unaudited and prepared in accordance with International
Accounting Standards.
Minerals Legislation - AngloGold well placed to implement charter
The finalisation of the Socio-Economic Empowerment Charter on 9 October 2002
helped restore a reasonable degree of certainty to an industry which had been
under severe pressure for much of the quarter. AngloGold fully supports the
notion that the mining industry, and the wider economy, here to find ways of
dealing with the legacy of the country`s history. All that is required is that
these efforts are carried out in a manner that ensures economic development and
growth.
AngloGold believes that the 15%, or R100bn (US$10bn), five-year empowerment
target agreed between government and the industry can realistically be met. The
same applies to the ten-year 26% target. The company awaits with interest the
finalisation of the charter`s adjunct "scorecard".
This scorecard is intended to set out exactly how each applicant company`s
overall empowerment status is to be calculated as part of their applications for
new order mineral rights. In addition to ownership questions, it will include
objectives for the industry covering human resource development, employment
equity in the appointment of managerial staff, mining community and rural
development, housing conditions, the contribution of black-owned companies in
the supply of goods and services to the industry.
AngloGold is well placed to meet the charter`s targets in each of these
categories. On the ownership question, the company has completed a number of
asset sales in the past four years which have shown how it is possible to craft
viable transactions which expand empowerment with no significant loss of value
and which will be credited by the charter. Those assets, owned by ARMgold,
produced 267,000oz of gold in the third quarter of this year, while AngloGold`s
South African operations produced 864,000oz. The charter provides for this
method of measuring empowerment in ownership terms.
The company is also energetically pursuing inquiries into forms of broad-
based equity ownership, including employee share ownership and empowerment unit
trusts.
For AngloGold`s full response to the charter visit www.anglogold.com
This quarter you will notice our quarterly report looks different. We have
taken on board your comments about both content and layout and have incorporated
these into this new-look document. We would like to hear your comments on the
"new style" report - please contact us at investors@anglogold.com or by
telephone on +27 11 637 6317.
Administrative information
Contacts
South Africa
Steve Lenahan
Telephone: +27 11 637 6248
Fax: +27 11 637 6247
E-mail: slenahan@anglogold.com
Peta Baldwin
Telephone: +27 11 637 6647
Fax: +27 11 637 6399
E-mail: pbaldwin@anglogold.com
Europe
Tomasz Nadrowski
Telephone: +41 22 718 3312
Fax: +41 22 718 3334
E-mail: tnadrowski@anglogold.com
Alex Buck
Telephone: +44 20 7664 8712
Fax: +44 20 7664 8711
E-mail: abuck@anglogold.com |