AngloGold aims for higher production


AngloGold aims for higher production

Published Date: 2021-02-23 | Source: Stephen Gunnion | Author: Stephen Gunnion

AngloGold aims for higher production

The gold mining company has more than quadrupled its annual dividend as it benefitted from a higher gold price and a more efficient portfolio.

AngloGold Ashanti plans to boost production by as much as 18% over the year five years as it ramps up its Obuasi mine in Ghana and benefits from incremental improvements from existing gold mines. And, if it gets approval from its board later this year, new production from projects in Colombia could add to that.

The gold mining company reported a 7% decline in gold output to 3.05-million ounces last year after it sold its remaining SA gold assets to Harmony Gold Mining and after production was impacted by Covid-19 lockdown restrictions. It aims to grow annual production to between 3.2-million and 3.6-million ounces by 2025. Its Obuasi Redevelopment Project in Ghana continued its ramp-up, delivering 127,000 ounces of production despite delays in receiving equipment and in the arrival of critical skills for the project as a result of lockdowns in various jurisdictions during the year.

A sharp rise in the gold price more than compensated for the dip in production, with basic earnings for the year to end-December increasing to $953 million, or 227 US cents per share, from a $12 million loss in 2019. Headline earnings grew to $1 billion, or 238c per share, from $379 million previously. All-in sustaining costs for the year increased by 6.1% to $1,059 an ounce. It increased its full-year dividend by 327% to R7.05 per share. In US dollars, the dividend rose more than fivefold, to 48c from 9c in 2009.

It said its performance was underpinned by a strong year at its Geita mine, while steady performances at Kibali, Iduapriem, Siguiri, Sunrise Dam, and AGA Mineração helped offset declines in production at Tropicana, Cerro Vanguardia and Serra Grande.

Stronger cash flows helped it reduce adjusted net debt for continuing operations by 62% to $597 million. Since 2013, it said it had used surplus cash generated by its mines and the proceeds from the sale of assets in the US, SA and Mali, to reduce net debt by more than 80%, to the lowest levels in a decade.

AngloGold has guided for production of between 2.7-million and 2.9-million ounces this year at all-in sustaining costs of between $1,130 and $1,230 an ounce.

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