South Africa's AngloGold reports Q2 loss - CNBC Africa

South Africa's AngloGold reports Q2 loss

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The world's third-largest bullion producer said it would revert to a bi-annual payout of the dividends.

The South Africa-based miner with global operations posted an adjusted headline loss of 35 U.S. cents in the April to June period compared to earnings of 29 U.S cents in the previous three months.

It blamed the scrapping of its quarterly dividend payments on the volatile environment and said it would review its dividend policy at the year end with a view to returning money to shareholders twice a year.

Production for the three months to June 30 was 935,000oz at a total cash cost of $898/oz, compared to 899,000oz at $894/oz the previous quarter, and to AngloGold Ashanti’s guidance of 900,000oz to 950,000oz at total cash costs of $900/oz to $950/oz.

[DATA ANG:AngloGold Ashanti] said the result was aided by improvements from mines in Continental Africa region, as well as from Serra Grande in Brazil.

The gold price has traded significantly lower this year, with current levels of around $1,290/oz considerably weaker than about $1,600/oz recorded at the end of 2012.

AngloGold Ashanti posted an adjusted headline loss of $135m during the quarter, which included the impact of the reduced gold price during the quarter and the consequential write-down of ore stockpiles, necessitated by the lower bullion price, as well as retrenchment costs.

The overhead expenditure accounted for $752m in 2012, and is expected to decline to between $270m and $315m next year.

“We have adopted a decisive, two-pronged response to this weaker gold price environment, focused on revenue enhancement and improving efficiencies by addressing costs at a number of levels. Our two important new mines are expected to contribute approximately 550,000oz to 600,000oz of new annual production next year at below our current average cost, improving the group’s cash cost and cash flow profile,” said Srinivasan Venkatakrishnan,  Chief Executive Officer, AngloGold Ashanti.

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