Interim Management Statement

RNS Number : 5898K

Anglo American PLC

22 April 2010

 



News Release

22 April 2010

Anglo American plc Interim Management Statement Production Report for the first quarter ended 31 March 2010

Overview

·     Iron ore production increased by 23% to 12.3 million tonnes as Sishen's jig plant continues to ramp up to full production

·     Platinum refined production increased by 11% to 447,000 ounces, on track to meet full year target of 2.5 million ounces, with upside flexibility to meet market demand

o  Unit costs on track to remain flat vs. 2009

o  Further labour productivity increase; improved by 17% since Q1 2009

·     Copper production increased by 7% to 161,000 tonnes, due to higher grades and recoveries at Los Bronces and higher grades and throughput at Collahuasi

·     Nickel⁽¹⁾ production increased by 7% to 4,800 tonnes

·     Metallurgical coal production increased by 32% to 3.6 million tonnes

·     Thermal coal production decreased by 2% to 19.2 million tonnes

·     Diamond production increased to 7 million carats to meet strengthening market demand

·     Major divestment programme progressing well

o  Zinc sale process well advanced and highly competitive

o  Tarmac Polish Concrete Products sale completed and Tarmac European Aggregates sale agreed, for an aggregate consideration of approximately $400 million

·     Anglo Platinum and De Beers rights issues successfully completed, supported by Anglo American. Strong demand for $1.7 billion Anglo Platinum rights issue, with minority shareholders over-subscribing by almost 3 times.

Results for the half year to 30 June 2010 will be announced on 30 July 2010.

This report forms Anglo American plc's Interim Management Statement for the purpose of the UK Listing Authority's Disclosure and Transparency Rules.

⁽¹⁾ Nickel production from the Nickel Business Unit.

Q1 2010 Production Summary by Business Unit

Platinum		Q1	Q1	Q1 2010	Q4	Q1 2010
		2010	2009	vs.	2009	vs.
				Q1 2009		Q4 2009
Refined
Platinum	000 oz	447	404	11%	766	-42%
Palladium	000 oz	247	235	5%	426	-42%
Rhodium	000 oz	62	74	-16%	94	-34%
Nickel	t	4,400	3,300	33%	5,300	-17%
Equivalent refined
Platinum	000 oz	595	613	-3%	604	-1%

Platinum - Refined production increased by 11% to 446,700 ounces. Processing performance was in line with expectations during the quarter, with the planned Polokwane Smelter furnace re-build completed successfully, ahead of schedule. Anglo Platinum continues to target full year production of 2.5 million ounces of refined platinum and retains the flexibility to increase that level to meet market demand.

Equivalent refined platinum ounces from mining and purchase activities were 594,700 ounces for the quarter. Production in Q1 2009 included some 31,000 equivalent refined platinum ounces from higher cost operations that were placed on care and maintenance during Q2 and Q3 2009.

Palladium, Rhodium & Nickel - Refined production of palladium and nickel increased by 5% and 33% respectively, whilst rhodium decreased by 16%. The increases vary due to a different source mix from operations and different pipeline processing times per metal.

Copper		Q1	Q1	Q1 2010	Q4	Q1 2010
		2010	2009	vs.	2009	vs.
				Q1 2009		Q4 2009
Copper	t	160,800	150,500	7%	185,900	-14%

Copper - Production increased by 7% to 160,800 tonnes. Collahuasi benefited from improved grades and higher throughput levels. Production at Los Bronces increased as a result of higher grades and recovery. These increases were partially offset by lower production at Mantos Blancos, primarily due to a conveyor belt failure.

Production decreased by 14% compared to Q4 2009, principally due to lower ore grades at Los Bronces and Collahuasi. At Collahuasi, lower throughput as a result of high clay content and scheduled mill stoppages also impacted production.

Nickel		Q1	Q1	Q1 2010	Q4	Q1 2010
		2010	2009	vs.	2009	vs.
				Q1 2009		Q4 2009
Nickel	t	4,800	4,500	7%	4,900	-2%

Nickel - Production increased by 7% compared to Q1 2009, when production was impacted by maintenance stoppages at the Codemin reduction furnace and by the temporary suspension of operations at Loma de Níquel following the expiration of the slag deposition permit.

Iron Ore and Manganese		Q1	Q1	Q1 2010	Q4	Q1 2010
		2010	2009	vs.	2009	vs.
				Q1 2009		Q4 2009
Iron ore	000 t	12,328	9,992	23%	12,407	-1%
Manganese ore	000 t	684	293	133%	615	11%
Manganese alloys	000 t	68	42	62%	52	31%

Iron ore - Total production increased by 23% to 12.3Mt and was flat compared to Q4 2009.  Sishen Mine's production increased by 0.3Mt compared to Q4 2009 to 11.0Mt. The 3.3Mt produced by the jig plant accounted for 30% of Sishen Mine's production.

Production from the jig plant increased by 7% or 0.2Mt compared to Q4 2009.  The ramp up of the jig plant to produce 12.5-13Mt during 2010 continues as planned.

Production from Thabazimbi Mine decreased by 23% compared to Q4 2009, to 0.5Mt.

Demand for iron ore continues to recover in Europe, Japan and Korea which coupled with continued strong demand from China, resulted in Kumba's export sales in the quarter of 9.3Mt, an increase of 21% on Q4 2009.  

Manganese ore - Production increased by 133% as market conditions continued to recover during the quarter. Samancor is operating at close to full capacity.

Manganese alloys - Production increased by 62% as market conditions continued to recover during the quarter.

Metallurgical Coal		Q1	Q1	Q1 2010	Q4	Q1 2010
		2010	2009	vs.	2009	vs.
				Q1 2009		Q4 2009
Production
Export metallurgical	000 t	3,282	2,315	42%	3,806	-14%
Thermal	000 t	3,350	3,212	4%	3,487	-4%
Weighted average achieved FOB prices
Export metallurgical	US$/t	131	203	-35%	123	7%
Export thermal	US$/t	79	84	-6%	67	18%
Domestic thermal	US$/t	31	23	35%	30	3%
Attributable sales volumes
Export metallurgical	000 t	3,258	1,877	74%	3,285	-1%
Export thermal	000 t	1,317	1,458	-10%	1,614	-18%
Domestic thermal	000 t	1,949	2,017	-3%	2,222	-12%

Metallurgical Coal - Production of metallurgical coal from Anglo American's Australian operations increased by 42%, in response to strengthening market demand. Sales volumes benefited from preparations that were made in Q4 2009 as cyclonic rain conditions struck Queensland in Q1 2010.

The business unit increased production of thermal coal from mines in Australia by 4%, again in response to increasing market demand.

Thermal Coal		Q1	Q1	Q1 2010	Q4	Q1 2010
		2010	2009	vs.	2009	vs.
				Q1 2009		Q4 2009
Production
Thermal	000 t	7,460	7,729	-3%	7,785	-4%
Eskom	000 t	8,170	8,438	-3%	8,448	-3%
Metallurgical	000 t	111	220	-50%	131	-15%
Weighted average achieved FOB prices
RSA export thermal	US$/t	78	65	20%	66	18%
RSA domestic thermal	US$/t	18	17	6%	21	-14%
South American export thermal	US$/t	69	82	-16%	70	-1%
Attributable sales volumes
RSA export thermal	000 t	3,932	3,947	0%	4,206	-7%
RSA domestic thermal	000 t	1,190	1,642	-28%	1,448	-18%
South American export thermal	000 t	2,425	2,409	1%	2,735	-11%

Thermal Coal - Production of thermal coal, from the Group's South African and Colombian operations, was marginally lower than the Q1 2009 performance, due to above average rainfall in South Africa that hampered open-cast operations.

Diamonds		Q1	Q1	Q1 2010	Q4	Q1 2010
		2010	2009	vs.	2009	vs.
				Q1 2009		Q4 2009
Total	000 carats	7,012	1,082	548%	10,124	-31%

Diamonds - Production increased to 7 million carats in the first quarter of 2010 as the market continued to improve. Sales in Q1 2010 were nearly three times higher than the same period of 2009. This followed re-stocking in the pipeline in the first quarter, improving US consumer confidence and strong growth continuing in China and India.

Production is significantly ahead of Q1 2009, during which production was scaled back across all mines in response to weak market sentiment.

Relative to Q4 2009, heavy seasonal rainfall in Southern Africa imposed operational challenges, whilst production at De Beers' Canadian operations was favourable.

Production summary

The figures below include the entire output of consolidated entities and the Group's share of joint ventures, joint arrangements and associates where applicable, except for De Beers which is quoted on a 100% basis.

						% Change
						Q1 2010		Q1 2010
	Q1	Q4	Q3	Q2	Q1	vs.		vs.
	2010	2009	2009	2009	2009	Q4 2009		Q1 2009
Platinum
Platinum (troy ounces)	446,700	766,000	629,200	652,400	404,000	-42%		11%
Palladium (troy ounces)	247,000	426,300	337,500	361,600	235,100	-42%		5%
Rhodium (troy ounces)	61,600	93,900	92,100	90,100	73,800	-34%		-16%
Nickel (tonnes)	4,400	5,300	5,500	5,400	3,300	-17%		33%
Equivalent refined
Platinum (troy ounces)(1)	594,700	603,900	616,500	630,400	613,400	-1%		-3%
Diamonds (De Beers) (diamonds recovered - 000 carats)
Diamonds	7,012	10,124	7,885	5,509	1,082	-31%		548%
Copper (tonnes)	160,800	185,900	168,100	165,300	150,500	-14%		7%
Nickel (tonnes)	4,800	4,900	4,900	5,600	4,500	-2%		7%
Iron Ore and Manganese (tonnes)
Iron ore	12,328,000	12,407,200	11,861,000	10,336,000	9,992,000	-1%		23%
Manganese ore(2)	684,000	615,000	462,000	200,000	293,000	11%		133%
Manganese alloys(2)	68,100	52,000	25,000	10,000	42,000	31%		62%
Metallurgical Coal (tonnes)
Metallurgical	3,281,600	3,805,500	3,147,800	3,354,000	2,315,300	-14%		42%
Thermal	3,349,800	3,487,400	3,614,300	3,738,600	3,211,500	-4%		4%
Thermal Coal (tonnes)(3)
Thermal	7,460,000	7,785,400	8,431,600	8,429,300	7,729,200	-4%		-3%
Eskom	8,170,100	8,448,400	10,400,200	8,938,400	8,438,100	-3%		-3%
Metallurgical	111,400	130,500	224,300	172,300	220,000	-15%		-50%
Other Mining and Industrial (tonnes)
Metallurgical coal	194,700	149,900	164,900	152,600	177,900	30%		9%
Thermal coal	173,000	310,200	214,500	169,000	130,000	-44%		33%
Zinc	87,700	86,500	94,000	87,100	82,800	1%		6%
Lead	15,400	18,900	18,400	16,400	14,600	-19%		5%
South Africa Steel Products	182,000	167,000	183,000	164,000	179,000	9%		2%
International Steel Products	190,000	177,000	164,000	158,000	195,000	7%		-3%
Coal production by commodity (tonnes)
Metallurgical	3,587,700	4,085,900	3,537,000	3,678,900	2,713,200	-12%		32%
Thermal	10,982,800	11,583,000	12,260,400	12,336,900	11,070,700	-5%		-1%
Eskom	8,170,100	8,448,400	10,400,200	8,938,400	8,438,100	-3%		-3%

⁽¹⁾ Equivalent refined platinum production.

⁽²⁾ Saleable production.

⁽³⁾ Zibulo (previously Zondagsfontein) is currently not in commercial production and therefore all revenue and related costs associated with 134,000 tonnes (119,000 tonnes in Q4 2009) of production in Q1 2010 have been capitalised.

As production figures are sometimes more precise than the rounded numbers shown in this report, small differences may arise throughout the report between the summation of quarters and the year-to-date totals. The percentage change will reflect the percentage change in the rounded production figures shown in this report.

Due to the portfolio and management structure changes announced in October 2009, the Business Units have changed from those reported at 31 March 2009, 30 June 2009 and 30 September 2009. Comparatives have been reclassified to align with current presentation.

Forward looking statements:

This Interim Management Statement contains certain forward looking statements which involve risk and uncertainty because they relate to events and depend on circumstances that occur in the future.  There are a number of factors that could cause actual results or developments to differ materially from those expressed or implied by these forward looking statements. 

For further information, please contact:

United Kingdom

James Wyatt-Tilby, Media Relations

Tel: [phone]

Caroline Metcalfe, Investor Relations

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Leisha Wemyss, Investor Relations

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South Africa

Anna Mulholland, Investor Relations

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Pranill Ramchander, Media Relations

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Notes to Editors:

Anglo American plc is one of the world's largest mining companies, is headquartered in the UK and listed on the London and Johannesburg stock exchanges. Its portfolio of mining businesses spans precious metals and minerals - in which it is a global leader in both platinum and diamonds; base metals - copper and nickel; and bulk commodities - iron ore, metallurgical coal and thermal coal. Anglo American is committed to the highest standards of safety and responsibility across all its businesses and geographies and to making a sustainable difference in the development of the communities around its operations. The company's mining operations and extensive pipeline of growth projects are located in southern Africa, South America, Australia, North America and Asia.

www.angloamerican.co.uk

 

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