Finance > Profit-loss

AngloGold receives Q3 Australia kicker

AngloGold Ashanti’s (SJ:ANG) Australian mines made an above average contribution to its group output in the September quarter, a three-month period when the company produced almost a million ounces of gold.

Haydn Black*

Finance > Profit-loss

AngloGold receives Q3 Australia kicker

AngloGold Ashanti’s (SJ:ANG) Australian mines made an above average contribution to its group output in the September quarter, a three-month period when the company produced almost a million ounces of gold.

Haydn Black*

AngloGold receives Q3 Australia kicker

The Tropicana mine’s output rose 15% during the quarter due to plant de-bottlenecking

The miner poured 997,000oz of the precious yellow metal during the quarter, up 11% from the same time in 2016 and 9% higher than the previous three-month period, with Tropicana and Sunrise Dam proving to punch above their weight in the local gold space.

The Australia region produced around 14% of AngloGold's total production - 143,000oz - with the 18% surge in local production attributed to higher mill throughput, increased grades and metallurgical recoveries. 

Tropicana's production increased by 15% during the quarter due to plant de-bottlenecking.

It produced 80,000oz for AngloGold's 70% share, while Sunrise Dam yielded 63,000oz, up 24%, with strong production anticipated in the last quarter as high-grade stopes are mined in the Cosmo ore zone. 

While all-in sustaining costs at Sunrise Dam exceeded the company's average of US$1,071 per ounce, at $1,254, Tropicana's AISC were just $951/oz.

Spending is set to climb in the December quarter at both operations as the miner develops the fines pulping project in the processing plant and expansion of the village to support the proposed Long Island development at Tropicana, and implements the recovery enhancement project and a wall raise on the tailings facility at Sunrise Dam.

The Australian unit delivered a combined gross profit of $41 million towards the global gross $205 million.

Overall the Johannesburg-based company generated free cash of $88 million despite its reinvestment programme and a flat gold price, and it remains on track to meet its full-year guidance of production between 3.6-3.75Moz at an AISC of $1,050-$1,100/oz.

Globally, the company continues to shift its focus from its traditional South Africa base, selling or shuttering high cost or non-core operations, with South African output expected to fall to 13% of total production.

Meanwhile, Tanzania's new mining code continues to pose issues, and AngloGold argued that changes to taxes and levies are costing it around $60 million per annum.

It has commenced arbitration proceedings to solve the impasse.

AngloGold's ASX-listed shares recently traded at A$2.50 (US$1.90), having peaked at A$3.29 earlier in the year. 

*Haydn Black is a reporter at MiningNews.net

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