AngloGold puts Mali mine on sale
ANGLOGOLD Ashanti says 942 employees have accepted voluntary separations. Bloomberg
Newly appointed chief executive Kelvin Dushnisky said yesterday that the group and IamGold, which collectively own an 82percent interest in Sadiola, had initiated a process to identify third parties that could be interested in acquiring their collective interests in the Mali mine. “The process is at a very preliminary stage and there is no certainty of its outcome,” Dushnisky said.
The proposed Sadiola sale follows moves by the group to reduce operations in South Africa to 13percent of total production last year after selling Moab Khotsong mine to Harmony Gold for $300million.
The group also sold the Kopanang mine to Hong Kong-headquartered Chinese capital management company Heaven-Sent Sunshine Investment Company for R100m.
Ian Cruickshanks, the chief economist at the South African Institute of Race Relations, said the sale of the local assets signalled that the future of the mining sector was not in South Africa.
“The sale supported the negative bearish outlook for the economy as a whole and it means more jobs will be lost,” he said.
AngloGold plans to cut 2000 jobs in South Africa. Yesterday, the group said that forced job losses had been mitigated by the sale of some assets, including healthcare facilities and rail networks, resulting in forced retrenchments of around 200 people. It said 942 employees accepted voluntary separations.
AngloGold said its output fell 15percent to 851000 ounces for the quarter ended in September, compared to the third quarter of 2017, mainly due to the sale of assets in South Africa.
“AngloGold Ashanti remains on track to at least meet full-year guidance on all metrics, costs are trending towards the lower end of the guided range and production at the upper end, while capital expenditure guidance has been revised downwards,” the company said.
Capital expenditure dropped 35percent to $163m (R2.33billion) in the quarter from $251m recorded during the corresponding period last year. “This decrease was largely due to planned lower capital expenditure across the portfolio,” it said.
Net debt declined by 15percent to $1.749bn from $2.063bn last year. Free cash flow generation – a measure of a company’s liquidity, was $34m in the period compared to the $88m of the third quarter last year, due mainly to the lower gold price and higher working capital.
AngloGold shares rose 3.99percent on the JSE yesterday to close at R146.67.
BUSINESS REPORT
Source: iol.co.za