AngloGold full year results reveal reduction in gold production

Shares in global gold producer AngloGold Ashanti fell slightly on Wednesday after the company published results showing a reduction in gold production for the year ending December 2012.

Shares in global gold producer AngloGold Ashanti fell slightly on Wednesday after the company published results showing a reduction in gold production for the year ending December 2012.

The volume of gold produced in the full year was 3.99m ounces compared to 4.33m ounces in the preceding year.

However, the price received for each ounce of gold rose to $1,664 compared to $1,574 per ounce in 2011.

Geographical BreakdownA geographical breakdown of the countries where AngloGold produces gold showed that the company's operations in Continental Africa generated the highest proportion of the yellow metal - representing almost half of all gold production with 43.8%, while operations in Australasia produced the smallest proportion of overall gold production, representing 6.4%.

A total of 376,000 ounces of gold was produced in Continental Africa, 10% less than the volume generated in the preceding year.

Some 171,000 ounces was produced in South Africa, 57% less than the volume produced in the prededing year.

55,000 ounces was generated in Australasia, 13% lower than in the preceding year and 258,000 ounces were produced in the Americas, 10% more than in the previous year.

The company posted earnings before interest, tax, depreciation and amortisation (EBITDA) of $2.4bn, down from $3.01bn in the previous year.

A full year dividend of 300 South African Cents per share was recorded while a quarterly dividend of 50 South african cents per share was given.

Decisive action takenTony O'Neill, Joint Interim Executive Officer, commented: "We've moved decisively to ensure that we continue a strong recovery from a difficult end to last year."

Srinivasan Venkatakrishnan, Joint Interim Chief Executive Officer, said: "We're creating a leaner business and placing an absolute focus on costs, capital efficiency and driving returns to shareholders".

He added: "We have also been proactive and obtained a term facility to backstop, if required the convertible bond maturing in May 2014 to remove refinancing risk."

Gold production in 2013 is estimated at between 4.1m ounces and 4.4m ounces, the company said

Analysts' comments: Investec viewThe Investec Global Natural Resources Research Team described the results as: "A reasonable result, given the strike issues in the fourth quarter. Like most companies in the sector now, AGD[Anglogold Ashanti] intends focusing on margins and returns, rather than production growth.

"Outgoing Chief Executive Officer, Mark Cutifani, states AGD delivers the best returns on capital amongst the gold majors."

Angold Ashanti' share price was down 4% to 1,800p at 08:09 on Wednesday.

MF

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