Anglo American Plc · LSE:AAL
Anglo American — Anglo American Platinum — Corporate Update (November 2016)
25 slides from Anglo American's corporate update, Nov 23, 2016
Slide 1: Anglo American Site Visit – Platinum Business Overview and Update
PLATINUM ANGLO AMERICAN SITE VISIT PLATINUM BUSINESS OVERVIEW AND UPDATE 23 NOVEMBER 2016 Mogalakwena mine – North pit haul truck and drill rigs
Slide 2: Cautionary Statement
CAUTIONARY STATEMENT Disclaimer: This presentation has been prepared for Anglo American Platinum Limited and the entities in the Anglo American Platinum group (“Anglo American Platinum”) and comprises the written materials/slides for a presentation concerning Anglo American Platinum. By attending th
Slide 3: Agenda
PLATINUM AGENDA • 07:00 – Business overview and update from Chris Griffith, CEO of Platinum • 07:45 – Q&A • 08:00 – Presentation on Mogalakwena mine from GM Richard Cox • 08:45 – Q&A • 09:00 – Depart for Mogalakwena mine • 10:00 – Arrive at Mogalakwena – Safety briefing and visual & simulation exper
Slide 4: What to Expect from the Visit
WHAT TO EXPECT FROM THE VISIT Our Assets, Our Business Processes and Innovation support People driving competitive advantage An unparalleled resource in the platinum industry in terms of A world class geology and accessibility resource A long life asset with significant scalability potential sup
Slide 5: Platinum Business – Map of Operations
PLATINUM BUSINESS – MAP OF OPERATIONS 5
Slide 6: Platinum Business Overview
PLATINUM BUSINESS OVERVIEW Assets Reserves Inclusive (4E Moz) Resources (4E Moz) Mogalakwena 116.0 286.4 Focus is on highest Amandelbult* 12.2 122.5 quality assets Leading Unki 5.1 32.5 Mechanised or position mechanisation BRPM* (33% attributable) 5.4 23.2 potential (23,000 employees) Mototolo 1
Slide 7: Platinum Leadership Team
PLATINUM LEADERSHIP TEAM World class and experienced leadership team Chris Griffith CEO Dean Pelser Gordon Smith Ian Botha Gary Humphries Indresen Pillay Mining Technical Finance Director Processing Safety & Projects Seara Mkhabela Vishnu Pillay Andrew Hinkly Lorato Mogaki Corporate Affairs JVs & No
Slide 8: Safety
SAFETY Strong focus on critical controls to ensure safety performance on all measures improves Lost time injury frequency rate per (200,000 hours) Tragically 7 fatalities YTD 2016 Lost time injury frequency rate has Normalised for strike improved 35% from 2012, to 0.75 1.15 1.05 0.83 2016 YTD 0.
Slide 9: Platinum Strategic Objectives
PLATINUM STRATEGIC OBJECTIVES Our value driven strategy is built around three key deliverables 1 Portfolio repositioning ambition Assets positioned in the first half of the cost curve At least 70% mechanised mining A more highly skilled work force Safer operations Less complex organisation
Slide 10: Business Update
BUSINESS UPDATE Portfolio progress; positive industrial relations engagement; challenges at Waterval smelter 1 Rustenburg sale completed Portfolio Amandelbult long-dated resource disposal announced repositioning Pandora disposal announced 2 Constructive and collaborative negotiation process
Slide 11: Portfolio Repositioning
PORTFOLIO REPOSITIONING 11
Slide 12: Portfolio Repositioning
PORTFOLIO REPOSITIONING Our focus remains on repositioning to generate long term value through the cycle Anglo American Platinum retained portfolio Core attributes Retained assets Optionality - projects • For now – high value, capital light, • Mogalakwena short payback Leading industry position •
Slide 13: Portfolio Transition to Date
PORTFOLIO TRANSITION TO DATE Repositioning of the portfolio making progress Restructuring since 2013… …now repositioning the …and rightsizing the overhead portfolio… R billion Reshaped Rustenburg 5.4 Non-core Assets (0.6) Rustenburg (0.4) Restructured Union Achieved Pandora in H1 2016 (0.7) Simp
Slide 14: Beneficial Financial Impact of Rustenburg Exit
BENEFICIAL FINANCIAL IMPACT OF RUSTENBURG EXIT The Rustenburg disposal is earnings, cashflow and ROCE accretive for AAP EBIT (Rbn) Cashflow (Rbn) ROCE (%) +R900m +R900m +4% 3.6 12% 3.0 2.7 2.1 8% 1H 2016 Pro-forma 1H 2016 Pro-forma 1H 2016 Pro-forma Ex Rustenburg Ex Rustenburg Ex Rustenburg Headcoun
Slide 15: Exit of 42.5% Stake in Pandora
EXIT OF 42.5% STAKE IN PANDORA Another major milestone completed in the repositioning of the portfolio Platinum ounces from Baobab (‘000) (1) Transaction summary Signed a sale and purchase agreement to dispose of a 42.5% stake in Pandora mine to JV partner Lonmin plc on 10 November 2016 12.3 Pro
Slide 16: Amandelbult Sale of Mineral Resources
AMANDELBULT SALE OF MINERAL RESOURCES The sale of resources outside of mine plan releases further capital Transaction summary Amandelbult On 11 October announced disposal of 2015 Amandelbult overview mineral resources within the Amandelbult Reserves 4E (Moz) 12.2 mining right and surface propertie
Slide 17: Operational Excellence
OPERATIONAL EXCELLENCE 17
Slide 18: Focus on Operational Excellence
FOCUS ON OPERATIONAL EXCELLENCE Ensure all assets are optimised to improve cash flow generation and returns Mogalakwena Amandelbult Platinum production (’000 ounces) Platinum production (’000 ounces) +31% +18% c.400 c.450 393 438 375 381 373 341 Strike 305 impacted 219 2012 2013 2014 2015 2016F 2012
Slide 19: Focus on Operational Excellence
FOCUS ON OPERATIONAL EXCELLENCE Ensure all assets are optimised to improve cash flow generation and returns Process Stay in business capex Base Metal production (‘000 tonnes) Rand billion (16)% +100% 3.9 40 3.6 3.0 32 2.5 26 20 2012 2013 2014 2015 2012 2013 2014 2015 Delivering optimal utilisation
Slide 20: Market Development, Innovation and Sustainability
MARKET DEVELOPMENT, INNOVATION AND SUSTAINABILITY 20
Slide 21: Develop Market for PGMs & Prepare for the Future
DEVELOP MARKET FOR PGMS & PREPARE FOR THE FUTURE Focussed investment in key areas to ensure a successful future • Automotive – fuel cell market development, Market hydrogen infrastructure development through PGM Investment Fund Development • Jewellery – PGI(1) focus on China and India • Investment –
Slide 22: Outlook
OUTLOOK 22
Slide 23: Outlook for 2016
OUTLOOK FOR 2016 2016 guidance remains in place (1) Platinum production expected to be towards the upper end of guidance of 2.3 to 2.4 million ounces (metal in concentrate) Unit cash cost guidance unchanged at between R19,250 – R19,750 per platinum ounce Direct overhead / indirect savings of R
Slide 24: Conclusion
CONCLUSION 1 Significant portfolio change in the current year to Repositioning Our enhance overall industry positioning Portfolio Rustenburg sale completed, with Amandelbult resource disposal and Pandora disposal announced 2 Operating model roll out is driving operational Driving improvements
Slide 25: Platinum Q&A
PLATINUM Real Mining. Real People. Real Difference.
Anglo American Platinum — Corporate Update (November 2016) on 6ix