SOURCE: AngloGold Ashanti

May 06, 2008 02:33 ET

AngloGold Ashanti Results for the First Quarter 2008

JOHANNESBURG, SOUTH AFRICA--(Marketwire - May 6, 2008) - AngloGold Ashanti (NYSE: AU) Results for the First Quarter Ended 31 March 2008.

AngloGold Ashanti reported adjusted headline earnings of $105m for the first quarter of 2008, significantly higher than the previous quarter, due to the improved gold price, tax credits and the absence of accounting adjustments that negatively affected earnings in the fourth quarter of 2007.

Operational performance saw first quarter production at 1.2Moz, 9% higher than previous guidance provided in February 2008, primarily due to the excellent work undertaken by the South African operations to mitigate the negative impact of the Eskom power situation. Total cash costs for the company were consequently lower at $430/oz for the quarter, significantly better than guidance of $467/oz.

Safety performance showed a marked improvement, with the lowest ever first quarter fatality rate achieved, and a reduction of 80% in fatality rates since the launch of the company's 'Safety is our first value' campaign in November 2007.

AngloGold Ashanti separately announced a proposed fully underwritten rights issue to raise approximately $1.6 billion.

During the quarter, AngloGold Ashanti reduced its hedge commitments from 11.28Moz to 10.03Moz, as it delivered into maturing contracts and additional hedge buy-backs that were effected. The net delta hedge position reduced by 1.13Moz to 9.26Moz as at 31 March 2008.

The company also announced the addition of 12.9Moz of inferred resources at its 100% owned La Colosa project in Colombia. This is the first significant gold porphyry discovery in the Colombian Andes, where AngloGold Ashanti has a first mover advantage with a land position of some 37,500km(2), with significant potential to increase the resource at La Colosa and at other projects in Colombia.

This new discovery is in addition to the 6.95Moz attributable of JORC Inferred and Indicated Resources declared by AngloGold Ashanti on 31 December 2007, as generated by greenfields exploration programmes during the year. At year end the company published attributable mineral resources of 207.6Moz.

In respect of 2008 production guidance, the company increased its gold production outlook to a range of 4.9Moz and 5.1Moz, up from prior guidance of 4.8Moz to 5.0Moz. Total cash costs are expected to be in a range of $440/oz and $460/oz, based on the following exchange rate assumptions: R/$7.88, A$/$0.91, BRL/$1.71 and Argentinean peso/$ 3.16.

Commenting on the quarter, CEO Mark Cutifani said, "In this quarter we delivered on our commitments across all key measures in the business. From improving production and managing costs, to reducing our hedge book and bringing to account a significant new gold discovery, I am confident that we are starting to drive value back into the business. We are also starting to see the benefits of a concerted new approach to safety. This must remain our key focus and it's an area where we still have much work to do."

Cutifani added that he was "particularly pleased with the work the South African operational team has done, together with Eskom and organised labour, to manage through the power issue. We are seeing improved efficiencies and safer work practices, using less power, which speaks to successfully working the problem together."

The full quarterly report can be found on the AngloGold Ashanti website at

Certain statements made during this communication, including, without
limitation, those concerning the economic outlook for the gold mining
industry, expectations regarding gold prices, production, cash costs and
other operating results, growth prospects and the outlook of AngloGold
Ashanti's operations including the completion and commencement of
commercial operations of certain of AngloGold Ashanti's exploration and
production projects, and its liquidity and capital resources and
expenditure, 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 2007, which was distributed to
shareholders on 31 March 2008.  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.

In connection with the proposed merger transaction involving AngloGold
Ashanti and Golden Cycle Gold Corporation, AngloGold Ashanti has filed with
the SEC a registration statement on Form F-4 and GCGC will mail a proxy
statement/prospectus to its stockholders, and each will be filing other
documents regarding the proposed transaction with the U.S. Securities and
statement/prospectus will be mailed to GCGC's stockholders. Stockholders
will be able to obtain a free copy of the proxy statement/prospectus, as
well as other filings containing information about AngloGold Ashanti and
GCGC, without charge, at the SEC's Internet site (
Copies of the proxy statement/prospectus and the filings with the SEC that
will be incorporated by reference in the proxy statement/prospectus can
also be obtained, without charge, by directing a request to AngloGold
Ashanti, 76 Jeppe Street, Newtown, Johannesburg, 2001 (PO Box 62117,
Marshalltown, 2107) South Africa, Attention: Investor Relations, +27 11 637
6385, or to Golden Cycle Gold Corporation, 1515 S. Tejon, Suite 201,
Colorado Springs, CO 80906, Attention: Chief Executive Officer, (719) 471-

Contact Information

  • Contacts

    South Africa
    Charles Carter (Investor Relations)
    Tel. +27 (0) 11 637-6385
    Mobile: +27 (0) 82 330 5373
    E-mail: Email Contact

    Himesh Persotam (Investor Relations)
    Tel: +27 (0) 11 637-6647
    Mobile: +27 (0) 82 339 3890
    E-mail: Email Contact

    Alan Fine (Media)
    Tel: +27 (0) 11 637-6383
    Mobile: +27 (0) 83 250 0757
    E-mail: Email Contact

    Joanne Jones (Media)
    Tel: +27 (0) 11 637- 6813
    Mobile: +27 (0) 82 896 0306
    E-mail: Email Contact

    North America
    Dan Gagnier (Sard Verbinnen & Co)
    Tel: +1-212-687-8080
    Mobile: +1 646-342-8087
    E-mail: Email Contact

    UK and Europe
    Rachel Hirst (Hogarth Partnership Ltd)
    Tel: +44-207-357 9477
    E-mail: Email Contact

    Nick Denton (Hogarth Partnership Ltd)
    Tel: +44-207-357 9477
    Email: Email Contact