Anglo American Plc · LSE:AAL
Anglo American — De Beers — Corporate Update (November 2016)
18 slides from Anglo American's corporate update, November 2016
Slide 1: De Beers in Botswana Site Visit – November 2016
DE BEERS IN BOTSWANA SITE VISIT – NOVEMBER 2016
Slide 2: Partnership between Botswana and De Beers is mutually beneficial
PARTNERSHIP BETWEEN BOTSWANA AND DE BEERS IS MUTUALLY BENEFICIAL The De Beers Group of Companies 1 1
Slide 3: Last three years saw strongest diamond jewellery demand ever
CUMULATIVELY, THE LAST THREE YEARS HAVE SEEN THE STRONGEST DIAMOND JEWELLERY DEMAND EVER, DESPITE SOME WEAKER CONDITIONS IN H2 2015 GLOBAL TOTAL 2009-2015 CAGR 4% The De Beers Group of Companies 2 2 Source: The Diamond Insight Report 2016, De Beers
Slide 4: Consolidated rough diamond sales to Q3 2016 up 39%
CONSOLIDATED ROUGH DIAMOND SALES TO Q3 2016 UP 39% (AFTER A WEAK H2 2015) 700 Cycle 3 600 666 Cycle 4 Cycle 7 Cycle 2 636 639 617 Cycle 5 Cycle 1 564 500 545 Cycle 6 528 Cycle 8 494 Cycle 9 400 470 (P) 300 Cycle 10 200 (2015) 248 100 0 US$ million H1 2016: 3,028 The De Beers Group of Companies H2 20
Slide 5: Our five key areas of focus
OUR FIVE KEY AREAS OF FOCUS 1 Enduring partnerships 2 Implementation of the operating model to optimise cost and productivity 3 Innovation across the pipeline 4 Tailored consumer propositions 5 Attractive portfolio – profitable growth options The De Beers Group of Companies 4 4
Slide 6: The right people in the right places doing the right things
THE RIGHT PEOPLE IN THE RIGHT PLACES DOING THE RIGHT THINGS The De Beers Group of Companies 5 5
Slide 7: Your visit: GSS and Jwaneng are unique and valuable assets
YOUR VISIT: GSS AND JWANENG ARE UNIQUE AND VALUABLE ASSETS Global Sightholder Sales Debswana: Jwaneng Mine Key facts Key takeaways Key facts Key takeaways • Relocated from London to • World’s leading rough • Originally incorporated as De • Jwaneng is the world’s Gaborone in 2013 diamond facility Bee
Slide 8: Appendix
APPENDIX The De Beers Group of Companies 7
Slide 9: Company overview
COMPANY OVERVIEW Anglo American 85% Government of the Republic of Botswana 15% De Beers Operations Rough diamond sales Brands/retail Exploration Production Mining Supermaterials Debswana Namdeb Element Six Global Auction Sales Forevermark De Beers Global Canada South Africa Diamond Holdings Technolo
Slide 10: Schematic flow of diamonds around the group
SCHEMATIC FLOW OF DIAMONDS AROUND THE GROUP Unaggregated goods De Sightholder Global Beers Global Sightholder Sales and Auction Sales Sales 15% ODC1 85% 85% Namdia2 15% Trading Sightholder DTC Botswana Namibia DTC Sales South Africa Mountain 90% SDT3 100% Province4 / 51% 10% 49% Mining Debswana Namd
Slide 11: Group structure from an accounting perspective
GROUP STRUCTURE FROM AN ACCOUNTING PERSPECTIVE Upstream 100% 100% 19.2% 50% De Beers Canada1 De Beers Debswana3 Namdeb Holdings4 Consolidated Mines (DBCM)2 Midstream 100% 100% 50% 50% De Beers Global De Beers Auction Sales Partner Diamond Trading Companies4 Sightholder Sales Downstream and Element S
Slide 12: Diamond mining operations and carats recovered
DIAMOND MINING OPERATIONS AND CARATS RECOVERED L E D F N A B G M C I J H K Canada Botswana Namibia South Africa 100% owned Debswana Namdeb Holdings De Beers Consolidated Established 1998 50/50 joint venture 50/50 joint venture Mines (DBCM) Gahcho Kué 51% joint venture with the Government with the Go
Slide 13: Diamond resource and reserve estimates as at 31 December 2015
DIAMOND RESOURCE AND RESERVE ESTIMATES AS AT 31 DECEMBER 2015 Selected De Beers Assets % De Beers Classification EXCLUSIVE Diamond Reserve Estimates Ownership Diamond Resource Estimates as at 31 December 2015 as at 31 December 2015 Tonnes Carats Grade1 BCO1 Treated Saleable Recovered BCO LOM years (
Slide 14: Diamond resource and reserve estimates: explanatory notes
DIAMOND RESOURCE AND RESERVE ESTIMATES AS AT 31 DECEMBER 2015: EXPLANATORY NOTES Unless otherwise stated, tonnage is quoted as dry metric tonnes. Estimates of Diamond Reserve tonnes reflect the tonnage to be treated. Reported Diamond Reserves/Resources are based on a Bottom Cut Off (BCO) which refer
Slide 15: Margins and sales
MARGINS AND SALES 2016 H1 Margin analysis by mine ($/ct) EBIT $m 519 585 Midstream 182 370 279 163 Upstream 519 Margin Cost 146 114 Other (27) (89) 240 207 122 64 Downstream H1 2016 & E6 24 50 Debswana Namdeb South Canada Carats sold by De Beers (‘000) Overall average realised price Holdings Africa
Slide 16: Financial overview
FINANCIAL OVERVIEW Income statement Group stock (US$bn) US$bn H1 H2 FY H1 2015 2015 2015 2016 FY 2015 1.5 Revenue 3.0 1.7 4.7 3.3 of which, rough diamonds 2.7 1.4 4.1 3.1 H1 2016 1.0 Underlying EBIT 0.6 0.0 0.6 0.6 Stock is low at June 2016 and is expected to increase. Margin % 20% 0% 13% 18% EBITDA
Slide 17: Price index and production
PRICE INDEX AND PRODUCTION Index prices down 6% in H1 2016… Carats recovered (‘000) 32,605 160 2014 2015 2016 28,692 December FY 8,366 7,050 155 232 150 +7% -15% September YTD 24,239 21,642 19,588 145 2014 2015 2016 140 Carats sold (‘000)1 135 34,426 JV sales 1,696 130 December FY 7,505 24,010 -6% 2
Slide 18: Debswana contribution to EBIT, production and capex
DEBSWANA CONTRIBUTION TO EBIT, PRODUCTION AND CAPEX EBIT contribution from Debswana is significant Carats recovered (‘000) EBIT Build-up 2016 H1 ($m) Contribution 13,315 to revenue (116) Other 2,803 20% 40% 182 519 Debswana 10,512 80% 60% DB Other 249 H1 2016 585 Capex ($m) 240 Debswana 270 Other 19