AngloGold Ashanti's Widening Net Loss Beats Forecasts
February 22 2016 - 3:30AM
Dow Jones News
JOHANNESBURG—AngloGold Ashanti Ltd. reported a loss of $70
million in 2015, compared with a loss of $39 million a year
earlier, beating expectations as the company continued to focus on
reducing debt and improving margins even as gold prices continued
to fall.
Analysts had forecast a 2015 loss of 23 cents a share, compared
with the actual loss of 20 cents a share, according to Thomson One.
The Johannesburg-based mining company reported an 18% drop in
revenue to $4.17 billion, beating expectations for a 25% slide from
2014.
The company reported a profit of 16 cents a share for the fourth
quarter of 2015, handily beating expectations for earnings of 5
cents a share and up from a loss of 14 cents a share in the three
months ended Dec. 31, 2014, as AngloGold benefited from a weaker
rand and lower oil prices.
As miners have had to dig ever deeper to reach South Africa's
gold deposits, massive cost increases including labor and
electricity have hit profitability as gold prices have tumbled in
the global market. AngloGold has been aided by better margins in
its international operations, which now account for 75% of the
group's production.
Still, the company has cut overhead expenditure by more than
two-thirds since the end of 2012 to combat gold prices, which are
down more than 35% from 2011 highs above $1,900 an ounce. The
company received an average price of $1,158 an ounce in 2015, down
8.4% from $1,264 in 2014.
AngloGold's net debt fell by 30% to $2.19 billion in the 12
months ended Dec. 31 from 2014, achieving the company's stated goal
of reducing debt by $1 billion during the current downturn in gold
prices. A joint venture to develop and operate the company's Obuasi
mine in Ghana with Randgold Resources Ltd. that could have helped
reduce that debt further fell through in December.
"It's still a high grade, long life asset," Srinivasan
Venkatakrishnan, the company's chief executive told reporters
Monday. "We are still confident in getting a joint venture partner
in the mine." He added that the company is working with the
government to complete a feasibility study as soon as possible.
AngloGold produced 3,830,000 ounces of gold from continuing
operations during the 12 months ended Dec. 31, down 9.3% from a
year earlier. Still, all-in sustaining costs dropped 11% from 2014
to $910 an ounce.
AngloGold's shares are currently trading up 60% year-to-date on
the Johannesburg Stock Exchange, boosted by a 15% rise in the gold
price to above $1,200 an ounce.
Write to Alexandra Wexler at alexandra.wexler@wsj.com
(END) Dow Jones Newswires
February 22, 2016 03:15 ET (08:15 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
AngloGold Ashanti (NYSE:AU)
Historical Stock Chart
From Aug 2024 to Sep 2024
AngloGold Ashanti (NYSE:AU)
Historical Stock Chart
From Sep 2023 to Sep 2024