Anglogold Ashanti Plc · NYSE:AU
Anglogold Ashanti — IPO Roadshow (September 2014)
37 slides from Anglogold Ashanti's IPO roadshow presentation, Sep 10, 2014
Slide 1: Investor presentation September 2014
Investor presentation September 2014 AngloGoldAshanti
Slide 2: Disclaimer
Disclaimer This document includes “forward-looking information” within the meaning of Section 27A of the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended. All statements other than statements of historical fact are, or may be deemed to be, forward-looking statements
Slide 3: Agenda
Agenda Restructuring and recapitalisation to unlock value Building from a strong platform Revitalising a South African mining champion Creating Newco – a leading London listed gold company Conclusions Appendix
Slide 4: Restructuring and recapitalisation to unlock and realise full potential
Restructuring and recapitalisation to unlock and realise full potential Transformational South African regulatory approval to restructure AngloGold Ashanti into two focused companies1 "Newco" An independently managed, international gold company holding the company's existing assets outside South Afr
Slide 5: Proposed transaction
Proposed transaction Subject to shareholder approval and certain other consents Newco to hold all assets outside South Africa Premium listing of Newco on LSE, inward listing on JSE and ADRs listed on NYSE Partial demerger of 35% of Newco to AngloGold Ashanti shareholders AngloGold Ashanti to initial
Slide 6: Portfolio overview
Portfolio overview Asset portfolios within and outside South Africa have increasingly different strategic drivers... South African assets Non-South African assets Asset characteristics Geographically concentrated portfolio Mature, predominantly deep level Labour intensive Established world-class inf
Slide 7: Two businesses with independent scale, capability and focus
Two businesses with independent scale, capability and focus AngloGold Ashanti Newco Newco Primary listing / Other1 JSE / NYSE LSE / JSE, NYSE Domicile South Africa UK Index inclusion JSE FTSE UK Series 2013 Operational metrics* Reserves2 (Moz) 30.9 37.0 2013 Production (Moz) 1.3 2.8 2013 Total Cash
Slide 8: Clear, independent strategies for value delivery
Clear, independent strategies for value delivery AngloGold Ashanti Rationalisation of operating infrastructure Seven individual operations consolidated to three operating hubs (West Wits, Vaal River, Surface) First phase of consolidation under way (i.e. Moab Khotsong and Great Noligwa) with addition
Slide 9: Two independent and experienced Boards and management teams
Two independent and experienced Boards and management teams AngloGold Ashanti Transitional Services Structure Newco Board Chair: Sipho Pityana CEO: Srinivasan Venkatakrishnan CFO: Christine Ramon COO Mike O'Hare Non-Executive Directors Existing Board to remain in place with the exception of Michael
Slide 10: Agenda
Agenda Restructuring and recapitalisation to unlock value Building from a strong platform Revitalising a South African mining champion Creating Newco – a leading London listed gold company Conclusions Appendix
Slide 11: Proven track record of delivery
Proven track record of delivery Progress has been made in achieving outlined strategic objectives despite tough headwinds Significant cost savings and capital discipline Overhead and exploration costs down 74% 1H 2014 vs. 2H 2012 AISC improved 20% y-o-y since H1 2013 Targeted capex reduction by 31%
Slide 12: Safety performance
Safety performance We have achieved a step-change improvement in safety performance All injury frequency rate (AIFR) per million hours 12.23 11.44 9.84 8.50 7.59 6.79 45% Q2 2009 Q2 2010 Q2 2011 Q2 2012 Q2 2013 Q2 2014 Fatalities H1 H2 16 9 6 4 9 9 18 5 9 11 6 9 5 3 2007 2008 2009 2010 2011 2012 201
Slide 13: Operating performance
Operating performance Despite a significant decline in the gold price, free cash flow is positive... Particulars Q2 2013 Q2 2014 Improved Q2'14 vs Q2'13? H1 2013 H1 2014 Improved H1'14 vs H1'13? Gold price received ($/oz) 1,421 1,289 -9% 1,529 1,289 -16% Gold production (kozs) 935 1,098 17% 1,834 2,
Slide 14: Cost reduction
Cost reduction Significant overhead savings have been realised and maintained... 209 144 136 97 78 55 54 Total decrease of 74% 124 79 79 55 41 30 33 85 65 57 42 37 25 20 Q4 2012 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Corporate and marketing costs $m Exploration and evaluation costs $m
Slide 15: Capital structure
Capital structure Leverage has increased due to falling gold price, despite strong operating performance Evolution of leverage vs. gold price and market capitalization 15,000 10,000 5,000 0 0.2 0.8 1.9 1.7 2,000 1,500 1,000 500 0 Dec-11 6 Dec-12 6 Dec-13 Jun-14 US$m Gross debt 4 1,728 2,995 3,911 3,
Slide 16: Agenda
Agenda Restructuring and recapitalisation to unlock value Building from a strong platform Revitalising a South African mining champion Creating Newco – a leading London listed gold company Conclusions Appendix
Slide 17: AngloGold Ashanti: Leading South African focused miner
AngloGold Ashanti: Leading South African focused miner High quality, long life assets Proven leadership focused on growing long-term shareholder value Experienced management team able to focus on maximising the potential of the South African asset base World class reserve base with fully invested in
Slide 18: A rationalised, 'hub-based' operating framework
A rationalised, 'hub-based' operating framework Infrastructure consolidation underpins a potential step change in the cost base going forward Fundamentally restructure cost base by consolidating infrastructure into three hubs - West Wits, Vaal River and Surface Operations Rationalisation of corporat
Slide 19: Meaningful asset optimisation opportunities
Meaningful asset optimisation opportunities A number of opportunities to improve productivity… Implementation of mine productivity opportunities Intend to implement optimised shift arrangements at Mponeng B120 project to improve productivity and achieve quicker access to higher-grade areas Once prov
Slide 20: Technology could unlock long term potential
Technology could unlock long term potential Restructure will facilitate a more intense focus on achieving commercial application… Context SA Operations have narrow, high-grade tabular ore bodies 40% of gold left behind in pillars, another 30% lost in mining process Reef then diluted by >200% by mini
Slide 21: Agenda
Agenda Restructuring and recapitalisation to unlock value Building from a strong platform Revitalising a South African mining champion Creating Newco – a leading London listed gold company Conclusions Appendix
Slide 22: Newco: Disciplined global gold miner with compelling growth potential
Newco: Disciplined global gold miner with compelling growth potential Experienced management team focused on unlocking value potential from the portfolio Management team familiar with assets and geographies High quality, globally diversified portfolio of production and development assets Attractive
Slide 23: Continued project delivery
Continued project delivery Previous investment in key projects to continue enhancing the cash flow profile of business Kibali, Tropicana and CC&V MLE2 project anticipated to deliver significant production and overall cost benefits… Kibali: Kibali continues to make strong progress towards completion
Slide 24: Accelerated resolution of Obuasi
Accelerated resolution of Obuasi Decisive action now taken to correct underperformance at Obuasi… Decisive intervention to reduce cash outflow Retrenchment process well advanced with support from union; mine moving to care and maintenance by end 2014 New employment on fixed-term contract basis Cash
Slide 25: Unlocking the potential of Colombia
Unlocking the potential of Colombia Colombian portfolio includes large scale, world class, Tier I resource potential… World's largest greenfield projects 1,2 Target annual production kozpa La Colosa Gramalote Colombia has potential to be the largest new gold producing region globally Newco’s Colombi
Slide 26: Agenda
Agenda Restructuring and recapitalisation to unlock value Building from a strong platform Revitalising a South African mining champion Creating Newco – a leading London listed gold company Conclusions Appendix
Slide 27: Restructuring and recapitalisation to unlock and realise full potential
Restructuring and recapitalisation to unlock and realise full potential Transformational South African regulatory approval to restructure AngloGold Ashanti into two focused companies 1 “Newco” An independently managed, international gold company holding the company's existing assets outside South Af
Slide 28: Agenda
Agenda Restructuring and recapitalisation to unlock value Building from a strong platform Revitalising a South African mining champion Creating Newco – a leading London listed gold company Conclusions Appendix
Slide 29: Non-GAAP disclosure
Non-GAAP disclosure From time to time AngloGold Ashanti Limited may publicly disclose certain "Non-GAAP" financial measures in the course of its financial presentations, earnings releases, earnings conference calls and otherwise. The group uses certain Non-GAAP performance measures and ratios in man
Slide 30: Non-GAAP disclosure
Non-GAAP disclosure From time to time AngloGold Ashanti Limited may publicly disclose certain "Non-GAAP" financial measures in the course of its financial presentations, earnings releases, earnings conference calls and otherwise. The group uses certain Non-GAAP performance measures and ratios in man
Slide 31: Non-GAAP disclosure
Non-GAAP disclosure From time to time AngloGold Ashanti Limited may publicly disclose certain "Non-GAAP" financial measures in the course of its financial presentations, earnings releases, earnings conference calls and otherwise. The group uses certain Non-GAAP performance measures and ratios in man
Slide 32: Non-GAAP disclosure
Non-GAAP disclosure From time to time AngloGold Ashanti Limited may publicly disclose certain "Non-GAAP" financial measures in the course of its financial presentations, earnings releases, earnings conference calls and otherwise. The group uses certain Non-GAAP performance measures and ratios in man
Slide 33: Non-GAAP disclosure
Non-GAAP disclosure From time to time AngloGold Ashanti Limited may publicly disclose certain "Non- GAAP" financial measures in the course of its financial presentations, earnings releases, earnings conference calls and otherwise. The group uses certain Non-GAAP performance measures and ratios in ma
Slide 34: Non-GAAP disclosure
Non-GAAP disclosure From time to time AngloGold Ashanti Limited may publicly disclose certain "Non- GAAP" financial measures in the course of its financial presentations, earnings releases, earnings conference calls and otherwise. The group uses certain Non-GAAP performance measures and ratios in ma
Slide 35: Non-GAAP disclosure
Non-GAAP disclosure From time to time AngloGold Ashanti Limited may publicly disclose certain "Non- GAAP" financial measures in the course of its financial presentations, earnings releases, earnings conference calls and otherwise. The group uses certain Non-GAAP performance measures and ratios in ma
Slide 36: Non-GAAP disclosure
Non-GAAP disclosure From time to time AngloGold Ashanti Limited may publicly disclose certain Non-GAAP financial measures in the course of its financial presentations, earnings releases, earnings conference calls and otherwise. The group uses certain Non-GAAP performance measures and ratios in manag
Slide 37: Non-GAAP disclosure
Non-GAAP disclosure From time to time AngloGold Ashanti Limited may publicly disclose certain Non-GAAP financial measures in the course of its financial presentations, earnings releases, earnings conference calls and otherwise. The group uses certain Non-GAAP performance measures and ratios in manag