Interim Results - Part 2
ANGLO AMERICAN PLC
8 September 1999
Part 2
Consolidated profit and loss account
Unaudited Note 6 months
US$ million ended
30.6.99
Group and share of turnover of associates and 2 10,529
joint ventures
Less: share of joint ventures' turnover (698)
Less: share of associates' turnover (2,682)
Group turnover 7,149
Operating costs (6,475)
Exploration expenditure 4 (62)
Group operating profit 612
Share of operating profits in joint ventures 91
Share of operating profits in associates 290
Total operating profit before exceptional items 2 993
Exceptional items 8 49
Profit on ordinary activities before interest 1,042
Investment income 426
Interest expense (323)
Profit on ordinary activities before taxation 1,145
Tax on profit on ordinary activities 5 (226)
Profit on ordinary activities after taxation 919
Equity minority interests (359)
Profit for the period 560
Dividends paid and proposed (164)
Retained profit for the period 396
Profit before exceptional items 3,8 514
Earnings per share (US$):
Profit for the period 1.47
Profit before exceptional items 1.35
Dividend per ordinary share (US cents) 42
Number of ordinary shares (millions) 380(1)
Consolidated profit and loss account (continued)
Unaudited 6 months Year
US$ million ended ended
30.6.98 31.12.98
pro forma pro
forma
Group and share of turnover of associates and 11,155 20,660
joint ventures
Less: share of joint ventures' turnover (561) (1,087)
Less: share of associates' turnover (3,110) (5,270)
Group turnover 7,484 14,303
Operating costs (6,635) (12,870)
Exploration expenditure (71) (137)
Group operating profit 778 1,296
Share of operating profits in joint ventures 68 113
Share of operating profits in associates 355 563
Total operating profit before exceptional 1,201 1,972
items
Exceptional items (155) 165
Profit on ordinary activities before interest 1,046 2,137
Investment income 502 1,012
Interest expense (302) (747)
Profit on ordinary activities before taxation 1,246 2,402
Tax on profit on ordinary activities (368) (555)
Profit on ordinary activities after taxation 878 1,847
Equity minority interests (337) (571)
Profit for the period 541 1,276
Dividends paid and proposed (161) (483)
Retained profit for the period 380 793
Profit before exceptional items 689 1,107
Earnings per share (US$):
Profit for the period 1.44 3.38
Profit before exceptional items 1.83 2.94
Dividend per ordinary share (US cents) 41 124
Number of ordinary shares (millions) 377 377
(1)Represents issued share capital (407.6 million) less shares in ESOP trust
(18 million) weighted for the average number of treasury shares held until
placed in market on 24 May 1999 (10 million).
Consolidated balance sheet
Unaudited As at As at
US$ million 30.6.99 31.12.98
pro forma
Fixed assets
Intangible assets 1,257 1,151
Tangible assets 10,703 10,318
Investments in joint ventures and 5,466 5,852
associates
Other financial assets 1,953 1,408
19,379 18,729
Current assets
Stocks 1,612 1,958
Debtors 2,306 2,142
Current asset investments 2,661 3,029
Cash at bank and in hand 1,309 1,192
Short term borrowings (857) (1,170)
Other current liabilities (2,401) (2,984)
4,630 4,167
Total assets less current liabilities 24,009 22,896
Long term liabilities (3,812) (3,788)
Provisions (1,626) (1,533)
Equity minority interest (3,037) (3,230)
Net Assets 15,534 14,345
Capital and reserves
Share capital and premium 2,033 1,169
Reserves 8,317 8,388
Profit and loss account 5,184 4,788
Total shareholders' funds (all equity) 15,534 14,345
Consolidated cash flow statement
Unaudited 30.6.99
US$ million
Note
Net cash flow from operating activities 9 605
Dividends from associates and joint ventures 120
Returns on investment and servicing of finance (289)
(a)
Taxation (148)
Capital expenditure 7 (604)
Financial investment (b) 247
Disposals / (acquisitions) 94
Equity dividends paid (130)
Cash outflow before use of liquid resources (105)
and financing
Management of liquid resources (c) 368
Financing (126)
Increase in cash in the period 137
Reconciliation of net cash flow to movement in
net debt
Increase in cash in the period 137
Cash inflow / (outflow) from change in debt 257
Cash (outflow) / inflow from change in liquid (368)
resources
Change in net debt resulting from cash flows 26
Loans, finance leases and current asset (51)
investments acquired with subsidiary
Other non-cash items 21
Translation differences 42
Movement in net debt in the period 38
Net debt at beginning of the period (737)
Net debt at end of period 10 (699)
Consolidated cash flow statement (continued)
Unaudited 6 Year
US$ million months ended
ended 31.12.98
30.6.98 pro
pro forma
forma
Net cash flow from operating activities 973 2,092
Dividends from associates and joint 202 341
ventures
Returns on investment and servicing of (216) (625)
finance (a)
Taxation (107) (388)
Capital expenditure (617) (1,425)
Financial investment (b) 174 391
Disposals / (acquisitions) (189) (208)
Equity dividends paid (359) (517)
Cash outflow before use of liquid resources (139) (339)
and financing
Management of liquid resources (c) (127) (356)
Financing 975 781
Increase in cash in the period 709 86
Reconciliation of net cash flow to movement
in net debt
Increase in cash in the period 709 86
Cash inflow / (outflow) from change in debt (968) (749)
Cash (outflow) / inflow from change in 127 356
liquid resources
Change in net debt resulting from cash (132) (307)
flows
Loans, finance leases and current asset - (354)
investments acquired with subsidiary
Other non-cash items - (16)
Translation differences 7 (43)
Movement in net debt in the period (125) (720)
Net debt at beginning of the period (17) (17)
Net debt at end of period (142) (737)
(a)Interest payable and receivable, dividend income from cost accounted
investments and dividend payments to minorities
(b)Disposal and acquisition of other financial assets included in fixed assets
(c)Cash flows in respect of current asset investments included in current
assets
Consolidated statement of total recognised gains and losses
Unaudited Note 6 months
US$ million ended
30.6.99
Profit for the period 560
Currency translation differences on foreign (71)
currency net investments
Total recognised gains and losses relating 489
to the period
Consolidated statement of total recognised gains and losses (continued)
Unaudited Year 31.12.98
US$ million ended pro
30.6.98 forma
pro
forma
Profit for the period 541 1,276
Currency translation differences on foreign (1,273) (1,257)
currency net investments
Total recognised gains and losses relating (732) 19
to the period
Combined statement of movements in shareholders' funds and movements on
reserves
Unaudited Share Other Profit Total
US$ million capital reserves and
and loss
premium account
At 1 January 1998 - pro 1,169 9,645 3,995 14,809
forma
Profit for the period - - 1,276 1,276
Dividends paid and proposed - - (483) (483)
Currency adjustments - (1,257) - (1,257)
At 31 December 1998 - pro 1,169 8,388 4,788 14,345
forma
Shares issued to Executive 864 - - 864
Share Option Scheme
Profit for the period - - 560 560
Dividends paid and proposed - - (164) (164)
Currency adjustments - (71) - (71)
At 30 June 1999 2,033 8,317 5,184 15,534
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.
2. Turnover and operating profit before exceptional items
Turnover
6 6 months Year
months ended ended
ended 31.12.98
30.6.99 30.6.98 pro
pro forma
forma
30.6.99 30.6.98 31.12.98
pro pro
forma forma
By business segment
Gold 1,113 1,301 2,650
Platinum 636 652 1,250
Diamonds 1,062 790 1,543
Coal 400 430 912
Base metals 523 404 794
Industrial minerals 488 511 1,073
Ferrous metals 649 808 1,631
Forest products 1,200 1,079 2,282
Industries 4,458 5,180 8,525
Financial services - - -
Exploration - - -
Rationalisation costs - - -
Corporate activities and - -
technical services -
10,529 11,155 20,660
Operating profit before
exceptional items
6 6 months Year
months ended ended
ended 30.6.98 31.12.98
30.6.99 pro pro forma
forma
By business segment
(continued)
Gold 239 271 502
Platinum 207 189 331
Diamonds 89 94 148
Coal 65 91 166
Base metals 57 44 86
Industrial minerals 48 67 95
Ferrous metals 46 80 158
Forest products 113 129 232
Industries 209 288 357
Financial services 66 60 120
Exploration (62) (71) (137)
Rationalisation costs (32) _ _
Corporate activities and (52) (41) (86)
technical services
993 1,201 1,972
By geographical segment (by origin)
Turnover
6 months 6 Year
ended months ended
30.6.99 ended 31.12.98
30.6.98 pro
pro forma
forma
South Africa 5,376 6,373 12,423
Rest of Africa 994 694 1,376
Europe 1,273 1,212 2,302
North America 1,878 2,168 3,422
South America 433 370 737
Australia and Asia 575 338 400
10,529 11,155 20,660
By geographical segment (by origin)(continued)
Operating profit before
exceptional items
6 6 months Year ended
months ended 31.12.98
ended 30.6.98 pro forma
30.6.99 pro forma
South Africa 744 868 1,482
Rest of Africa 43 40 75
Europe 82 125 263
North America 25 150 135
South America 79 24 26
Australia and Asia 20 (6) (9)
993 1,201 1,972
By geographical segment (by destination)
Turnover Operating profit
before
exceptional
items
6 6 Year
months months ended
ended ended 31.12.9
30.6.9 30.6.9 8
9 8 pro
pro forma
forma
South Africa 4,280 5,319 10,081
Rest of Africa 184 157 301
Europe 2,774 2,410 4,642
North America 2,285 2,659 4,119
South America 238 199 375
Australia and 768 411 1,142
Asia
10,529 11,155 20,660
3. Profit before exceptional items (A)
By business segment Operating Net investment
profit income
before
exceptional
items
Gold 239 40
Platinum 207 10
Diamonds 89 (8)
Coal 65 -
Base metals 57 (31)
Industrial minerals 48 2
Ferrous metals 46 (22)
Forest products 113 (25)
Industries 209 (16)
Financial services 66 9
De Beers investments (1) - 140
Exploration (62) -
Rationalisation costs (32) -
Corporate activities and (52) 4
technical services
Profit before exceptional 993 103
items
Exceptional items 49 -
Profit for the period 1,042 103
(1)Represents De Beers share of Anglo American plc earnings for the 6 months
to 30 June 1999.
3. Profit before exceptional items (A) (continued)
30.6.99
By business segment Equity Profit
Tax minority before
interests exceptional
items
Gold (48) (105) 126
Platinum (55) (89) 73
Diamonds (31) (9) 41
Coal (28) - 37
Base metals (6) (5) 15
Industrial minerals (18) - 32
Ferrous metals 3 - 27
Forest products (11) (2) 75
Industries (24) (83) 86
Financial services (22) (1) 52
De Beers investments (1) (32) (42) 66
Exploration - 8 (54)
Rationalisation costs - - (32)
Corporate activities and 18 - (30)
technical services
Profit before exceptional items (254) (328) 514
Exceptional items 28 (31) 46
Profit for the period (226) (359) 560
(1)Represents De Beers share of Anglo American plc earnings for the 6 months
to 30 June 1999.
3. Profit before exceptional items (continued)(B)
30.6.98
By business segment - pro forma
Operating Net
profit investment
before income
exceptiona
l items
Gold 271 29
Platinum 189 17
Diamonds 94 32
Coal 91 -
Base metals 44 (8)
Industrial minerals 67 4
Ferrous metals 80 (27)
Forest products 129 (21)
Industries 288 (34)
Financial services 60 7
De Beers investments (1) - 182
Exploration (71) -
Corporate activities and technical (41) 19
services
Profit before exceptional items 1,201 200
Exceptional items (155) -
Profit for the period 1,046 200
Represents De Beers share of Anglo American plc earnings for the 6 months to
30 June 1998.
3. Profit before exceptional items (continued)(B) (continued)
30.6.98
By business segment - pro forma Equity Profit
Tax minority before
interest exceptiona
s l items
Gold (65) (115) 120
Platinum (64) (81) 61
Diamonds (34) (10) 82
Coal (44) - 47
Base metals (7) (6) 23
Industrial minerals (12) (3) 56
Ferrous metals (6) (17) 30
Forest products (15) (4) 89
Industries (79) (73) 102
Financial services (21) (1) 45
De Beers investments (1) (48) (42) 92
Exploration - 10 (61)
Corporate activities and 25 - 3
technical services
Profit before exceptional items (370) (342) 689
Exceptional items 2 5 (148)
Profit for the period (368) (337) 541
Represents De Beers share of Anglo American plc earnings for the 6 months to
30 June 1998.
3. Profit before exceptional items (continued) (C)
31.12.98
By business segment - pro forma Operating Net
profit investmen
before t income
exceptional
items
Gold 502 76
Platinum 331 41
Diamonds 148 17
Coal 166 -
Base metals 86 (9)
Industrial minerals 95 11
Ferrous metals 158 (41)
Forest products 232 (73)
Industries 357 (48)
Financial services 120 6
De Beers investments (1) - 289
Exploration (137) -
Corporate activities and technical (86) (4)
services
Profit before exceptional items 1,972 265
Exceptional items 165 -
Profit for the period 2,137 265
(1)Represents De Beers share of Anglo American plc earnings for the 12 months
to 31 December 1998.
3. Profit before exceptional items (continued) (c) (Continued)
31.12.98
By business segment - pro forma Equity Profit
Tax minority before
interest exceptiona
s l items
Gold (132 (193) 253
)
Platinum (87) (160) 125
Diamonds (62) (16) 87
Coal (80) - 86
Base metals 3 (10) 70
Industrial minerals (9) (5) 92
Ferrous metals (17) (21) 79
Forest products (37) - 122
Industries (49) (114) 146
Financial services (43) (4) 79
De Beers investments (1) (71) (70) 148
Exploration - 21 (116)
Corporate activities and 24 2 (64)
technical services
Profit before exceptional items (560) (570) 1,107
Exceptional items 5 (1) 169
Profit for the period (555) (571) 1,276
(1)Represents De Beers share of Anglo American plc earnings for the 12 months
to 31 December 1998.
4. Exploration expenditure
6 months Year ended
30.6.99 ended 31.12.98
30.6.98 pro forma
pro forma
Gold 21 30 62
Coal - - 1
Base metals 41 41 74
62 71 137
5. Tax on profit on ordinary activities
6 months Year ended
30.6.99 ended 31.12.98
30.6.98 pro forma
pro forma
Tax payable in 11 10 22
the UK
Share of 100 124 225
associates tax
Foreign tax 115 234 308
payable
226 368 555
6. Net operating assets
As at As at
30.6.99 31.12.98
pro forma
By business segment
Gold 2,939 2,617
Platinum 1,373 1,147
Coal 754 811
Base metals 1,426 1,402
Industrial minerals 1,190 1,308
Ferrous metals 747 746
Forest products 1,326 1,102
Industries 3,464 3,465
Financial services (21) (5)
Corporate activities 588 143
13,786 12,736
By geographical segment
South Africa 8,303 8,186
Rest of Africa 233 57
Europe 2,189 1,583
North America 1,779 1,762
South America 1,203 1,046
Asia 79 102
13,786 12,736
Net operating assets consist of tangible and intangible fixed assets
(excluding investments in joint ventures and associates), stocks and debtors
less non-interest bearing current liabilities.
7. Capital expenditure
6 months 6 months Year ended
ended ended 31.12.98
30.6.99 30.6.98 pro forma
pro forma
By business segment
Gold 92 106 235
Platinum 103 109 251
Coal 7 12 33
Base metals 144 143 370
Industrial minerals 35 46 85
Ferrous metals 23 20 53
Forest products 59 62 86
Industries 130 110 279
Corporate activities 11 9 33
Capital expenditure 604 617 1,425
8. Profit before exceptional items
6 6 months Year
months ended ended
ended 30.6.98 31.12.9
30.6.99 pro 8
forma pro
forma
Profit for the period 560 541 1,276
Adjustment for exceptional
(gains) / losses:
Disposal of interest in (89) - -
Driefontein
Disposal of the Copebras carbon - - (124)
black business
Disposal by Terra of 67 - -
distribution business
Disposal of interest in Lonrho - 96 96
Disposal of other non-core (27) 59 (137)
assets
Exceptional items (49) 155 (165)
Taxation (28) (2) (5)
Minority interest 31 (5) 1
Profit before exceptional items 514 689 1,107
9. Reconciliation of group operating profit to net cash flow from operating
activities
6 6 months Year
months ended ended
ended 30.6.98 31.12.98
30.6.99 pro pro
forma forma
Group operating profit per the 612 778 1,296
accounts
Depreciation and amortisation 402 387 774
charges
Decrease / (increase) in stock 107 (64) 61
Increase in debtors (473) (656) (485)
(Decrease) / increase in (156) 441 429
creditors
Other non-cash items 113 87 17
Net cash flow from operating 605 973 2,092
activities
10. Analysis of net debt
Acquisition
At s excluding
01.01.98 Cash cash &
pro flow overdrafts
forma
Cash at bank and in hand 1,180 709 -
Debt due after one year (3,349) (414) -
Debt due within one year (621) (554) -
(3,970) (968) -
Current asset investments 2,773 127 -
Total (17) (132) -
At Acquisition
01.07.98 s excluding
pro Cash cash &
forma flow overdrafts
Cash at bank and in hand 1,777 (623) -
Debt due after one year (3,572) 216 (354)
Debt due within one year (1,157) 3 -
(4,729) 219 (354)
Current asset investments 2,810 229 -
Total (142) (175) (354)
Acquisition
At s excluding
01.01.99 Cash cash &
pro flow overdrafts
forma
Cash at bank and in hand 1,192 137 -
Debt due after one year (3,788) (58) (51)
Debt due within one year (1,170) 315 -
(4,958) 257 (51)
Current asset investments 3,029 (368) -
Total (737) 26 (51)
10. Analysis of net debt (continued)
Other Exchange At 30.06.98
non- movement pro forma
cash s
changes
Cash at bank and in hand 24 (136) 1,777
Debt due after one year (4) 195 (3,572)
Debt due within one year (20) 38 (1,157)
(24) 233 (4,729)
Current asset investments - (90) 2,810
Total - 7 (142)
Other Exchange At 31.12.98
non- movement pro forma
cash s
changes
Cash at bank and in hand 34 4 1,192
Debt due after one year (14) (64) (3,788)
Debt due within one year (21) 5 (1,170)
(35) (59) (4,958)
Current asset investments (15) 5 3,029
Total (16) (50) (737)
Other Exchange
non- movements At 30.06.99
cash
changes
Cash at bank and in hand 1 (21) 1,309
Debt due after one year 20 65 (3,812)
Debt due within one year (15) 13 (857)
5 78 (4,669)
Current asset investments 15 (15) 2,661
Total 21 42 (699)
11.Reconciliation of pro forma 1998 profit disclosed in prospectus to pro
forma comparatives in the interim report
31.12.98
Operating
profit Net
before Exceptional investment
exceptional items income
items
Per prospectus 2,016 149 43
Acquisition of
minorities:
Anglo American Gold - - -
Investment Co. Ltd
Anglo American - - -
Investment Trust Ltd
Adjustments and
reallocations:
De Beers diamonds (23) (3) (38)
De Beers investments (57) 19 260
Other adjustments and 36 - -
reclassifications
Per interim report 1,972 165 265
11.Reconciliation of pro forma 1998 profit disclosed in prospectus to pro
forma comparatives in the interim report (continued)
31.12.98
Tax on Equity
profit on minority Profit
ordinary interests for the
activities year
Per prospectus (441) (618) 1,149
Acquisition of
minorities:
Anglo American Gold - 49 49
Investment Co. Ltd
Anglo American - 53 53
Investment Trust Ltd
Adjustments and
reallocations:
De Beers diamonds (11) 26 (49)
De Beers investments (62) (77) 83
Other adjustments and (41) (4) (9)
reclassifications
Per interim report (555) (571) 1,276
interim dividend
An interim dividend on the company's ordinary share capital in respect of the
six months to 30 June 1999 will be payable as follows:
Amount 42 US cents per ordinary
share (see notes)
Currency conversion date Friday, 3 September 1999
Ex-dividend on the London and Monday, 20 September 1999
Johannesburg Stock Exchanges
from the commencement of
trading on
Record date Friday, 24 September 1999
Dividend warrants posted Thursday, 21 October 1999
Payment date of dividend Friday, 22 October 1999
Notes:
Shareholders on the United Kingdom register of members with an address in the
United Kingdom will be paid in pounds sterling, unless they elect for payment
in US dollars, and those shareholders with an address elsewhere will be paid
in US dollars, unless they elect for payment in pounds sterling, provided all
such elections are received by the UK Registrar by Friday, 24 September 1999.
The equivalent of the dividend in sterling will be 26.082 pence per ordinary
share based on an exchange rate of US$1 = £0.6210.
Shareholders on the South African branch register will be paid in South
African Rand, at R2.5325 per ordinary share based on an exchange rate of US$1
= R6.0297.
Production statistics
Production
statistics (1)
Production statistics for the six 1999 1998
months ended 30 June
AngloGold (gold in ounces)
South Africa 2,895,000 3,252,000
North and South America 433,000 411,000(2)
Rest of World 117,000 115,000
3,445,000 3,778,000
Anglo Platinum (troy ounces)
Platinum 928,000 958,000
Palladium 464,000 481,000
Rhodium 76,000 90,000
Nickel (tonnes) 9,000 10,000
Anglo Coal (tonnes)
Eskom 20,900,000 17,500,000
Trade 9,600,000 9,100,000
Cerrejon 200,000 600,000
30,700,000 27,200,000
Anglo Base Metals
Copper (tonnes)
Collahuasi 96,000 -
Mantos Blancos 76,000 68,000
Hudson Bay 22,000 24,000
Other 18,000 16,000
212,000 108,000
Zinc (tonnes)
Hudson Bay 44,000 47,000
Black Mountain 16,000 -
60,000 47,000
Lead (tonnes)
Black Mountain 38,000 -
38,000 -
Nickel (tonnes)
Codemin 3,300 3,500
Bindura 4,700 4,900
Tati 1,500 1,300
9,500 9,700
Namakwa Sands (tonnes)
Chloride slag 42,000 26,000
Sulphate slag 6,000 7,000
Pig iron 23,000 17,000
Zircon 39,000 18,000
Rutile 7,000 3,000
(1)Includes entire output of consolidated entities and the group's share of
joint ventures where applicable.
(2)Production in 1998 relates to Minorco's gold operations.
Production statistics
Production
statistics (1)
Production statistics for the six 1999 1998
months ended 30 June (continued)
Anglo Industrial Minerals
(tonnes)
Aggregates 14,200,000 14,900,000
Coated Stone 900,000 900,000
Concrete products 1,300,000 1,100,000
Cement 150,000 145,000
Potash 430,000 500,000
Sodium tripolyphosphate 41,000 32,000
Phosphates 190,000 210,000
Anglo Forest Products (tonnes)
South Africa
Pulp 187,000 164,000
Graphic papers 151,000 151,000
Packaging papers 239,000 266,000
Corrugated board (000 m2) 46,000 22,000
Lumber (000 m3) 183,000 234,000
Wood chips 473,000 504,000
Mining timber 69,000 134,000
Europe
Pulp 69,000 70,000
Graphic papers 274,000 261,000
Packaging papers 168,000 160,000
Corrugated board (000 m2) 293,000 14,000
Paper sacks (000 units) 315,000 317,000
Brazil
Pulp 73,000 71,000
(1)Includes entire output of consolidated entities and the group's share of
joint ventures where applicable.