Final Results - Year Ended 31 Dec 1999, Part 1
Anglo American PLC
22 March 2000
Part 1
ANGLO AMERICAN PLC REPORTS FIRST FULL YEAR RESULTS
* Headline profit* increased by 13% to US$1,308 million;
* Profit for the financial year of US$1,552 million (1998 pro forma: US$1,252
million);
* Total operating profit before exceptional items increased by 14% to US$2,142
million;
* Significant progress in strategic initiatives:
- Acquisitions: Skorpion/Reunion Mining (US$82 million), Amcor Fibre Packaging
(US$240 million), 23% of Anaconda Nickel (US$170 million), 40% of Australian
Manganese (US$159 million), Acacia Resources (US$443 million);
- Acquisition of Tarmac for US$1.9 billion, completed in March 2000;
- Increase of interest in Anglo American Platinum to 50.3% (US$270 million),
purchase of 1.9 million AngloGold shares (US$100 million; current stake
50.4%);
- Significant disposals of non-core assets: Terra's distribution business
(US$452 million), AECI's interest in Polifin (US$345 million), part of stake
in SA Breweries (US$159 million) as well as the reduction early in 2000 of
interests in McCarthy and Samcor;
* Final dividend of 108 US cents per ordinary share recommended - giving a
total dividend for the year of 150 US cents per ordinary share - an increase
of 21% over 1998 pro forma estimate.
HIGHLIGHTS TO 31 DECEMBER 1999
1999 1998 Change
(US$ million except per share amounts) pro forma
Total operating profit before exceptional items 2,142 1,879 14%
Profit for the financial year 1,552 1,252 24%
Headline profit *for the financial year 1,308 1,159 13%
Earnings per share (US$) 4.03 3.32 21%
Headline profit per share (US$) 3.40 3.07 11%
Total dividend for the year (US cents per 150 124 21%
ordinary share)
* - See note 6 for the basis of calculation of headline profits
Commenting on the results, Julian Ogilvie Thompson, chairman and chief
executive of Anglo American said: 'Anglo American plc's maiden set of full
year results were very pleasing, with total operating profit before
exceptional items increasing by 14%. The good operating performance by all
divisions took place against a background of strong platinum, diamond and, in
the fourth quarter, base metals markets and strengthening steel and pulp
markets. The US$1.9 billion acquisition of Tarmac in March 2000 was a major
highlight, and makes Anglo Industrial Minerals the largest producer of
aggregates and coated stone in the UK. The outlook for commodities in the
year ahead is positive with the US economy continuing to grow strongly while
Europe generally shows positive signs of recovery.'
For further information, please contact:
London
Nick von Schirnding Misha Nagelmackers
+ 44 171 698 8540 (w) + 44 171 698 8567 (w)
+ 44 7818 438 274 9 (mob)
Johannesburg
Michael Spicer Anne Dunn
+ 27 11 638 3870 (w) + 27 11 638 4730 (w)
+ 27 83 227 1319 (mob) + 27 82 448 2684 (mob)
AA plc website: www.angloamerican.co.uk
Anglo American plc is a leading mining and natural resources company with its
primary listing in London and secondary listings in Johannesburg and
Switzerland.
Anglo American's mining assets include interests in AngloGold, the world's
largest gold producer, Anglo Platinum, the world's largest primary producer of
platinum, De Beers, the world's largest producer and marketer by value of gem
diamonds, Anglo Coal, one of the world's largest private sector coal producers
as well as a substantial spread of base metal operations and projects. Anglo
American also has significant interests in industrial minerals, ferrous metals
and forest products and packaging activities.
FULL YEAR 1999 FINANCIAL RESULTS
Basis of preparation
Anglo American plc was listed in May 1999 following the acquisition of Anglo
American Corporation of South Africa Limited (AAC) and Minorco Societe Anonyme
(Minorco). In order to provide shareholders with a proper basis for
comparison, the 1999 financial statements for Anglo American have been
compared with pro forma financial statements for the year ended 1998. These
pro forma financial statements have been prepared to reflect the restructuring
of AAC and Minorco as if these restructuring transactions had occurred at the
beginning of 1998.
The principal adjustments in 1998 comprise:
- The full consolidation of Minorco;
- The acquisition of an additional interest in Samancor;
- The purchase of the minority interest in Amcoal;
- The purchase of the minority interest in Amic;
- The disposal of Minorco's gold interests and their acquisition by AngloGold;
- The disposal of the Group's interest in Engelhard Corporation;
- The purchase of the minorities in Anamint and Amgold;
- The treatment of Terra as an associate.
The effects of the Anamint and Amgold purchases which occurred in May 1999 and
the reclassification of Terra were not reflected in the unaudited pro forma
combined financial information contained in the Anglo American Prospectus
issued in April 1999.
Results for 1999
Turnover, including share of associates and joint ventures, fell by US$136
million to US$19,245 million. This decrease was primarily due to the impact of
the disposal in 1999 by AngloGold of its interest in Driefontein and, in the
second half of the year, by Terra of its distribution business and by AECI of
its associate Polifin. This decline was offset by increased revenues from base
metals and diamonds. The breakdown of turnover including the share of
associates and joint ventures is set out below:
Analysis of turnover by business division, US$ million:
1999 1998
Gold 2,235 2,650
Platinum 1,428 1,250
Diamonds 1,809 1,543
Coal 787 912
Base Metals 1,163 760
Industrial Minerals 1,008 1,073
Ferrous Metals 1,457 1,665
Forest Products 2,464 2,282
Industries 6,894 7,246
19,245 19,381
Total operating profit before exceptional items increased from US$1,879
million (including US$101 million from joint ventures and US$581 million from
associates) to US$2,142 million (including US$245 million from joint ventures
and US$592 million from associates). Acquisitions and disposals in 1999
contributed a net operating profit of US$26 million and therefore underlying
operating profit increased by US$237 million.
The factors contributing to this US$237 million increase were a US$400 million
currency gain arising principally from the strength of the US dollar relative
to the South African rand and higher contributions from De Beers and FirstRand
(US$137 million). These positive factors were offset by the net impact of
lower prices (US$109 million), lower sales (US$98 million) and higher costs
(US$75 million) and other items (US$18 million). The higher costs represent an
increase of less than 1% over 1998, significantly below the overall rate of
cost inflation.
The breakdown of operating profit, including Anglo American's share of joint
ventures and associates, is set out below:
Analysis of total operating profit before exceptional items by business
division, US$ million
1999 1998
Gold 452 489
Platinum 480 331
Diamonds 245 148
Coal 114 166
Base Metals 174 86
Industrial Minerals 118 95
Ferrous Metals 75 164
Forest Products 272 232
Industries 358 318
Financial Services 138 98
Exploration (138) (137)
Amortisation of goodwill (25) (21)
Corporate activities
Recurring (108) (98)
Non-recurring (13) 8
2,142 1,879
The increase in costs in corporate activities is primarily the result of the
impact of a number of non-recurring items and the establishment of the London
office. Exploration expenditure of US$138 million was unchanged from 1998 but
with an increasing emphasis on activities in base metals. The goodwill
generated on the restructuring of the group is being amortised on a straight-
line basis over 20 years.
The depreciation charge in 1999 (excluding joint ventures and associates)
remained broadly similar to 1998 at US$640 million. Total goodwill
amortisation at US$96 million was also in line with 1998.
The analysis by business division is as follows:
Analysis of depreciation by business division, US$ million
1999 1998
Gold 175 177
Platinum 57 51
Coal 35 43
Base Metals 91 53
Industrial Minerals 67 68
Ferrous Metals 27 40
Forest Products 57 50
Industries 119 129
Other 12 17
640 628
Investment income net of interest payable fell from US$332 million to US$265
million. This was the result of lower rand interest rates, the weakening of
the rand versus the US dollar and the impact of the disposal of non-core
investments on the level of dividend income.
The tax charge for the year was US$481 million which included a net US$18
million credit in respect of exceptional items. Excluding the impact of
exceptional items, the tax charge for the year represented an effective tax
rate of 21% compared with 26% in the previous year. The decline in the rate
was primarily due to the impact of the reduction in the South African
corporate tax rate from 35% to 30%, and high capital expenditure reducing the
amount of current tax payable.
Exceptional items contributed a net profit of US$410 million compared with
US$165 million in 1998. The gains in 1999 arose primarily from the sale of
AngloGold's interest in Driefontein, the sale of Polifin by AECI and the sale
of part of Anglo American's interest in South African Breweries and other non-
core investments. These gains were partly offset by the loss incurred by Terra
in disposing of its distribution business and restructuring costs in AECI.
The profit for the period at US$1,552 million was US$300 million or 24% higher
than in 1998. Headline profit at US$1,308 million, which excludes the impact
of exceptional items and adjusts for the amortisation of goodwill, was US$149
million higher than in 1998. An analysis by business division is set out
below:
Analysis of headline profit by business division, US$ million
1999 1998
Gold 210 261
Platinum 200 133
Diamonds 162 87
Coal 79 102
Base Metals 97 62
Industrial Minerals 116 106
Ferrous Metals 67 100
Forest Products 199 125
Industries 82 98
Financial Services 112 79
De Beers investments 151 148
Exploration (112) (116)
Corporate activities (55) (26)
1,308 1,159
Earnings per share at 403 US cents were 71 US cents higher than in 1998.
Headline profit per share at 340 US cents in 1999 was 11% higher than in 1998.
Cash flow
The following table summarises the major elements of Anglo American's cash
flow:
Cash flow analysis, US$ million
1999 1998
Group operating profit 1,305 1,197
Depreciation and amortisation 736 717
Movement in working capital (268) (128)
Other non cash items 77 73
Net cash inflow from operating activities 1,850 1,859
Taxation (273) (395)
Net interest and dividend income 245 253
Disposal of fixed assets 84 161
Available cash flow 1,906 1,878
Dividends paid - company and minorities (656) (877)
Net acquisitions and disposals (134) 114
Capital expenditure (1,251) (1,441)
Other 415 (378)
Movement in net funds/(debt) 280 (704)
Net (debt)/funds at start of the year (199) 505
Net funds/(debt) at end of the year 81 (199)
Net cash flow from operations at US$1,850 million, was little changed from the
previous year's level of US$1,859 million. Anglo American's continued
expansion programme resulted in capital expenditure of US$1,251 million.
Fixed asset disposals contributed US$84 million.
Significant acquisitions during 1999 included the purchase of the Skorpion
project (Reunion Mining) in Namibia, the increase in the interests in Anglo
Platinum and AngloGold and Forest Products' purchase of Amcor and Kohler.
Capital expenditure
An analysis by business division is set out below:
Analysis of capital expenditure by business division, US$ million
1999 1998
Gold 223 235
Platinum 239 252
Coal 26 32
Base Metals 257 329
Industrial Minerals 70 85
Ferrous Metals 47 52
Forest Products 181 165
Industries 175 256
Other 33 35
1,251 1,441
Dividends
A final dividend of 108 US cents per ordinary share has been recommended by
the Board, making a total for the year of 150 US cents per ordinary share. In
the cash flow the total equity dividend paid by Anglo American in 1999 of
US$276 million represents the final dividends paid by AAC and Minorco in the
first quarter of 1999 and the interim dividend of 42 US cents per ordinary
share paid by Anglo American in respect of 1999. This compares with a combined
dividend payment by AAC and Minorco in 1998 of US$517 million. The board
intends in future years to pay approximately one third of the annual dividend
at the interim stage.
Net cash
At the end of the year Anglo American held net funds of US$81 million. This
comprised US$3,618 million of cash and current asset investments offset by
US$3,537 million of total debt.
The US$633 million proceeds from the sale of 12.6 million Anglo American
shares in May were used to reduce sterling borrowings. A US$750 million
syndicated loan facility, which will mature in 2004, was arranged later in the
year to fund future acquisitions. This facility will be used to help finance
the acquisition of Tarmac. The financial completion of the Collahuasi project
in November resulted in US$449 million of debt no longer being recourse to
Anglo American.
Exchange rates used in preparing the accounts
Against the US dollar 1999 1998
Average
South African rand 6.09 5.48
Pound sterling 0.62 0.60
Euro 0.94 0.90
Year end
South African rand 6.15 5.88
Pound sterling 0.62 0.60
Euro 0.99 0.86
Y2K
The systems and contingency plans that were put in place to counter the year
2000 computer problem ('Y2K') were effective and there was no impact on the
Group during the millennium changeover. Anglo American has spent US$36 million
on the programme and does not envisage any significant expenditure in the
future. Ongoing scrutiny of potential Y2K impacts will be maintained until all
processing cycles have been completed. Opportunities were taken to improve
existing IT facilities in various businesses and to improve asset management
and business continuity planning.
DIVISIONAL HIGHLIGHTS
Gold
Turnover: US$ 2,235 million
Total operating profit before exceptional items: US$452 million
Headline profit: US$210 million
Net operating assets: US$2,990 million
Share of headline profit: 16%
The Gold division, consisting primarily of the Group's 50.4% interest in the
independently managed AngloGold, contributed US$452 million to total operating
profit before exceptional items for 1999 - a decrease of 8%. This reduction
was as a result of lower realised gold prices (averaging US$314 per ounce
during the year against US$330 per ounce for 1998) and lower production (down
6% to 6.9 million ounces - principally as a result of AngloGold's gold
production in South Africa decreasing by 10% to 5.7 million ounces). US
production totalled 485,000 ounces. South American operations exceeded
expectations by producing 426,000 ounces including 151,000 ounces from Cerro
Vanguardia in its first full year of production.
Platinum
Turnover: US$1,428 million
Total operating profit before exceptional items: US$480 million:
Headline profit: US$200 million
Net operating assets: US$1,519 million
Share of headline profit: 15%
The Platinum division, principally consisting of the Group's 50.3% interest in
Amplats reported total operating profit before exceptional items of US$480
million, 45% higher than in 1998, mainly because of higher palladium, rhodium
and nickel prices and greater platinum and palladium sales volumes. Increases
in rand costs were largely offset by the weakening of the South African
currency against the US dollar. In 1999 Amplats has reduced both the
operating cost and cash costs per platinum equivalent unit by 11%. In
December 1999 Amplats announced the development of a 162,000 ounce per year
mine at Maandagshoek at a capital cost of some US$200 million.
Diamonds
Turnover: US$1,809 million
Total operating profit before exceptional items: US$245 million
Headline profit: US$162 million
Net operating assets: US$131 million
Share of headline profit: 12%
Anglo American's diamond interests are represented by its 32.2% shareholding
in the independently managed De Beers group which, with its partners, is the
largest producer by value of gem diamonds in the world. De Beers sorts, values
and markets nearly 60% of the world's rough diamonds.
Anglo American's share of De Beers' total operating profit before exceptional
items for 1999 increased by 66% to US$245 million from US$148 million in 1998.
The improved performance resulted from strong global demand for diamonds in
the retail markets and a successful millennium marketing campaign.
Coal
Turnover: US$787 million
Total operating profit before exceptional items: US$114 million
Headline profit: US$79 million
Net operating assets: US$708 million
Share of headline profit: 6%
Anglo Coal's total operating profit before exceptional items for the year
decreased by 31% from US$166 million to US$114 million. Earnings from
collieries supplying Eskom, the South African power utility, were 5% lower and
earnings from the South African trade collieries decreased by 38% owing mainly
to lower prices in the export markets. Total production of 61.8 million
tonnes was 2.0 million tonnes higher than 1998. The trade collieries' total
sales for the year increased by 2% over 1998 to 19.6 million tonnes.
Production at Carbones del Cerrejon in Colombia was reduced from a total of 3
million tonnes per annum in 1998 to 1 million tonnes in 1999 owing to the high
cost of haulage by road. Access by rail to the port of Puerto Bolivar from
May 1999 resulted in transportation cost savings. In January 2000, Anglo Coal
increased its interest in Carbones del Cerrejon to 50% with the purchase of
half of Rio Tinto's 33% interest.
Base Metals
Turnover: US$1,163 million
Total operating profit before exceptional items: US$174 million
Headline profit: US$97 million
Net operating assets: US$1,606 million
Share of headline profit: 7%
Anglo Base Metals' total operating profit before exceptional items of US$174
million more than doubled from 1998, mainly because of the first full year's
contribution from Collahuasi and Black Mountain.
Copper
Combined copper output from Mantos Blancos' two operations in Chile was a
record 151,600 tonnes of copper of which 106,700 tonnes was in cathode copper
and the balance high-grade concentrates. Attributable production from the
Collahuasi open-pit copper mine in Chile was 168,600 tonnes of copper
contained in concentrates and 22,600 tonnes of copper in cathodes.
Attributable production from Palabora Mining in South Africa was 31,000 tonnes
of copper in concentrate.
Nickel
The Codemin nickel operation in Brazil produced 6,500 tonnes of nickel
contained in ferro-nickel. The Tati nickel mine in Botswana produced 3,700
attributable tonnes of nickel and 1,300 attributable tonnes of copper by
product.
Zinc
The Hudson Bay operation in Canada produced 82,800 tonnes of zinc metal and
50,300 tonnes of copper cathode. The Black Mountain mine in South Africa
produced 31,200 tonnes of zinc and 73,800 tonnes of lead.
Analysis of total operating profit before exceptional items
US$
million
Collahuasi 96
Mantos Blancos 27
Hudson Bay 6
Other 45
174
Industrial Minerals
Turnover: US$1,008 million
Total operating profit before exceptional items: US$118 million
Headline profit: US$116 million
Net operating assets: US$1,184 million
Share of headline profit: 9%
Anglo Industrial Minerals' operating profit before exceptional items was
US$118 million in 1999, an increase of US$23 million over 1998. 1998 included
non-recurring charges of US$41 million. The underlying contribution of the
division fell by US$18 million as a result of a fall of US$11 million in the
European construction materials operations and a fall of US$7 million at
Cleveland Potash, which suffered from flooding during the first half of the
year. The European operations were affected by a change in accounting policy
in respect of the depletion of mineral reserves in order to comply fully with
UK GAAP's FRS 15. The cost of reserves is now written off over the full life
of the operations rather than over the last 20 years, which was previous
policy.
An increased contribution from the STTP and fertiliser operations of Copebras
offset the loss of income from the sale of the carbon black operations in
1998. The depreciation of the Brazilian real in January 1999 gave Copebras a
very competitive position compared with imported products and enabled it to
increase sales volumes. Copebras' operating profit was further boosted by
productivity gains leading to reduced fixed costs and lower usage of raw
materials.
Analysis of total operating profit before exceptional items
US$
million
United Kingdom 84
Europe 9
South America 25
118
Ferrous Metals
Turnover: US$1,457 million
Total operating profit before exceptional items: US$75 million
Headline profit: US$67 million
Net operating assets: US$470 million
Share of headline profit: 5%
Anglo Ferrous Metals' total operating profit before exceptional items
decreased by 54% to US$75 million mainly owing to the poor results of Highveld
Steel and Columbus - a consequence of low vanadium prices and weak steel
demand. Likewise, manganese demand was affected by the poor steel market and
weakened during the year leading to an oversupply of manganese alloys.
Chrome ore production in Samancor reduced by 6%. Productivity improvements to
reduce unit costs continued. South African manganese production incurred
higher production costs resulting from the restart of one of Samancor's
furnaces in the second half of 1999.
Forest Products
Turnover: US$2,464 million
Total operating profit before exceptional items: US$272 million
Headline profit: US$199 million
Net operating assets: US$1,348 million
Share of headline profit: 15%
Anglo Forest Products' total operating profit before exceptional items of
US$272 million was 17% higher than in 1998, mainly as a result of further cost
savings, higher pulp prices in the second half of the year and the inclusion
of Amcor Fibre Packaging Europe, acquired during the year. As a result, Mondi
Europe's operating profit increased to US$124 million. Mondi South Africa's
operating profit rose slightly to US$136 million. Mondi has a 12%
shareholding and a 28% voting participation in Aracruz in Brazil, which
contributed operating profit for the year of US$12 million compared to a loss
of US$5 million in 1998.
Industries
Turnover: US$6,894 million
Total operating profit before exceptional items: US$358 million
Headline profit: US$82 million
Net operating assets: US$2,137 million
Share of headline profit: 6%
Anglo Industries showed an improvement in total operating profit before
exceptional items of 13% to US$358 million in 1999 despite a fall in turnover.
Results included a disappointing performance from Terra Industries, which
continued to suffer from depressed nitrogen markets. The inclusion of Tongaat-
Hulett as a subsidiary for the first full year contributed US$41 million to
the division's total operating profit before exceptional items.
As a result of the continued refocusing of investment on mining and natural
resources, profits on the sale of businesses lifted the net profit of the
division.
Progress was achieved in further disposals during the year, including Terra
selling its distribution business in May for US$452 million, AECI its 40%
interest in Polifin in August for US$345 million, the sale of part of the
division's holding in South African Breweries in November 1999 and in early
2000 a reduction of its holdings in McCarthy Retail from 28% to 11% and in
Samcor from 45% to 10%.
Analysis of total operating profit before exceptional items
US$
million
Tongaat-Hulett* 121
AECI 95
LTA 40
Other 102
358
*Includes the Group's contribution from the Hulamin Aluminium Joint Venture.
Financial Services
Total operating profit before exceptional items: US$138 million
Headline profit: US$112 million
Share of headline profit: 9%
Financial Services contributed US$138 million to total operating profit before
exceptional items, an increase of 41% over 1998. This is primarily as a
result of the increased contribution from FirstRand, which benefited from
better margins and restructuring.
Consolidated Profit and Loss Account
pro forma
(unaudited)
US$ million Note 1999 1998
Group and share of turnover of joint ventures 2 19,245 19,381
and associates
Less: Joint ventures' turnover 2 (1,720) (1,219)
Associates' turnover 2 (5,947) (6,543)
Group turnover - subsidiaries 2 11,578 11,619
Operating costs (10,273) (10,422)
Group operating profit - subsidiaries 2 1,305 1,197
Share of operating profit of joint ventures 2 245 101
Share of operating profit of associates 2 592 581
Total operating profit before exceptional 2 2,142 1,879
items
Profit on disposal of fixed assets 7 489 165
Costs of fundamental reorganisation by AECI 7 (79) -
Profit on ordinary activities before interest 3 2,552 2,044
Investment income 869 1,045
Interest payable (604) (713)
Profit on ordinary activities before taxation 2,817 2,376
Tax on profit on ordinary activities 5 (481) (570)
Profit on ordinary activities after taxation 2,336 1,806
Equity minority interests (784) (554)
Profit for the financial year 3 1,552 1,252
Equity dividends to shareholders - Paid and (585) (483)
proposed
Retained profit for the financial year 967 769
Headline profit for the financial year 3 1,308 1,159
Basic earnings per share (US$):
Profit for the financial year 4.03 3.32
Headline profit for the financial year 3.40 3.07
Diluted earnings per share (US$):
Profit for the financial year 3.98 3.29
Headline profit for the financial year 3.35 3.05
Dividend per share (US cents): 150 124
Basic number of shares outstanding (million) 385 377
Diluted number of shares outstanding (million) 390 380
Turnover and operating profit in respect of acquisitions and disposals in 1999
were not material.
Consolidated balance sheet
pro forma
(unaudited)
US$ million 1999 1998
Fixed assets
Intangible assets 1,585 1,377
Tangible assets 9,512 8,576
Investments in joint ventures: 1,564 1,409
Share of gross assets 3,394 3,287
Share of gross liabilities (1,830) (1,878)
Investments in associates 5,338 5,632
Other financial assets 1,489 1,395
19,488 18,389
Current assets
Stocks 1,431 1,507
Debtors 2,060 1,863
Current asset investments 2,315 3,206
Cash at bank and in hand 1,303 1,088
7,109 7,664
Short term borrowings (999) (1,239)
Other current liabilities (2,611) (2,426)
Net current assets 3,499 3,999
Total assets less current liabilities 22,987 22,388
Long term liabilities (2,538) (3,254)
Provisions (1,324) (1,414)
Equity minority interests (2,951) (2,704)
Net assets 16,174 15,016
Capital and reserves
Called up share capital 204 195
Share premium account 1,815 958
Merger reserve 2,424 2,424
Other reserves 1,047 1,059
Profit and loss account 10,684 10,380
Total shareholders' funds (all equity) 16,174 15,016
Consolidated cash flow statement
pro forma
(unaudited)
US$ million Note 1999 1998
Net cash inflow from operating activities 8 1,850 1,859
Expenditure relating to fundamental reorganisation of (46) -
AECI
Dividends from joint ventures and associates 209 341
Returns on investments and servicing of finance
Interest received and other financial income 388 321
Interest paid (402) (493)
Dividends received from fixed asset investments 50 84
Dividends paid to minority shareholders (380) (360)
Net cash outflow from returns on investments and (344) (448)
servicing of finance
Taxation
UK corporation tax (10) (5)
Overseas tax (263) (390)
Taxes paid (273) (395)
Capital expenditure and financial investment
Payments for fixed assets (1,251) (1,441)
Proceeds from the sale of fixed assets 84 161
Payments for other financial assets (1) (45) (146)
Proceeds from the sale of other financial assets (1) 534 445
Net cash outflow for capital expenditure and financial (678) (981)
investment
Acquisitions and disposals
Acquisition of subsidiaries (889) (477)
Disposal of subsidiaries 103 266
Investment in associates (429) (240)
Sale of interests in associates 592 266
Net cash outflow from acquisitions and disposals (623) (185)
Equity dividends paid to Anglo American shareholders (276) (517)
Cash outflow before use of liquid resources and (181) (326)
financing
Management of liquid resources (2) 912 (518)
Financing 8 (403) 934
Increase in cash in the year 328 90
(1) Disposal and acquisition of other financial assets included in fixed
assets.
(2) Cash flows in respect of current asset investments included in current
assets.
Consolidated statement of total recognised gains and losses
pro forma
(unaudited)
US$ million 1999 1998
Profit for the financial year 1,552 1,252
Joint ventures 135 48
Associates 565 492
Currency translation differences on foreign currency net (549) (1,257)
investments
Total recognised gains/(losses) for the financial year 1,003 (5)
NOTES TO FINANCIAL INFORMATION
1. Accounting policies
The financial information has been prepared in accordance with generally
accepted accounting principles in the UK. The accounting policies applied in
preparing the financial information are consistent with those adopted and
disclosed in the Accountants' Report on the Company included in Part IV of the
Listing Prospectus.
Status of financial information
The financial information set out herein does not constitute the Company's
statutory accounts for the year ended 31 December 1999 but is derived from
those accounts which were approved by the board of directors on 21 March 2000.
These will be delivered to the Registrar of Companies following the Annual
General Meeting convened for 16 May 2000. The auditors have reported on those
accounts; their report was unqualified and did not contain statements under
section 237(2) or (3) of the Companies Act 1985.
2. Segmental information
Turnover Operating Net operating
profit assets(1)
Pro forma pro forma pro forma
(unaudited) (unaudited) (unaudited)
US$ million 1999 1998 1999 1998 1999 1998
By business segment
Group subsidiaries
Gold 2,102 2,486 404 428 2,990 2,634
Platinum 1,428 1,250 480 331 1,519 1,159
Diamonds - - (7) - 131 143
Coal 731 874 121 176 708 773
Base Metals 740 657 49 50 1,606 1,292
Industrial Minerals 988 1,072 116 95 1,184 1,243
Ferrous Metals 839 1,174 40 121 470 500
Forest Products 1,307 1,061 149 141 1,348 934
Industries 3,443 3,045 222 120 2,137 2,157
Financial Services - - 19 (15) - (5)
Exploration - - (138) (137) - -
Corporate activities - - (150) (113) 441 370
11,578 11,619 1,305 1,197 12,534 11,200
Joint ventures
Gold 108 7 44 1
Coal 43 - 5 -
Base Metals 307 - 95 -
Industrial Minerals 20 - 2 -
Ferrous Metals 149 132 (12) (12)
Forest Products 1,093 1,080 111 112
1,720 1,219 245 101
Associates
Gold 25 157 4 60
Diamonds 1,809 1,543 252 148
Coal 13 38 (12) (10)
Base Metals 116 103 30 36
Industrial Minerals - 1 - -
Ferrous Metals 469 359 47 55
Forest Products 64 141 12 (21)
Industries 3,451 4,201 136 198
Financial Services - - 119 113
Corporate activities - - 4 2
5,947 6,543 592 581
19,245 19,381 2,142 1,879
(1) Net operating assets consist of tangible and intangible assets (excluding
investments in joint ventures and associates), stocks and debtors less non-
interest bearing current liabilities.
2.Segmental information continued
Turnover Operating Net operating
profit assets
pro forma pro forma pro forma
(unaudited) (unaudited) (unaudited)
US$ million 1999 1998 1999 1998 1999 1998
By geographical segment (by origin)
Group subsidiaries:
South Africa 8,258 8,710 1,173 1,077 8,039 7,984
Rest of Africa 259 197 (30) 17 150 65
Europe 1,442 1,223 50 18 1,864 1,569
North America 708 725 7 63 502 443
South America 614 694 114 35 1,431 1,097
Australia and Asia 297 70 (9) (13) 548 42
Joint ventures:
South Africa 192 132 (7) (6)
Rest of Africa 64 - 35 -
Europe 1,113 1,080 113 105
South America 351 7 104 2
Associates:
South Africa 3,108 4,072 388 432
Rest of Africa 1,075 893 163 102
Europe 123 170 13 15
North America 797 1,103 9 33
South America 88 69 2 (6)
Australia and Asia 756 236 17 5
19,245 19,381 2,142 1,879 12,534 11,200
By geographical segment (by destination)
Turnover
pro forma (unaudited)
1999 1998
Group subsidiaries
South Africa 5,522 6,372
Rest of Africa 462 410
Europe 2,632 2,016
North America 1,441 1,612
South America 497 387
Australia and Asia 1,024 822
Joint ventures
South Africa 87 37
Rest of Africa 86 19
Europe 1,176 1,047
North America 111 46
South America 75 10
Australia and Asia 185 60
Associates
South Africa 1,906 2,517
Rest of Africa 52 8
Europe 562 606
North America 1,871 2,372
South America 51 9
Australia and Asia 1,505 1,031
19,245 19,381
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