1H 2011 results presentation - Anglo American Platinum/media/... · KEY FEATURES •Sadly eight...
32
ANGLO AMERICAN PLATINUM LIMITED 2011 Interim Results 25 July 2011 Mogalakwena Central Pit
Transcript of 1H 2011 results presentation - Anglo American Platinum/media/... · KEY FEATURES •Sadly eight...
ANGLO AMERICAN PLATINUM LIMITED2011 Interim Results25 July 2011
Mogalakwena Central Pit
DISCLAIMER: CERTAIN FORWARD-LOOKING STATEMENTS
Certain statements made in this presentation constitute forward-looking statements. Forward-looking statements are typically identified by the use of forward-looking terminology such as 'believes', 'expects', 'may', 'will', 'could', 'should', 'intends', 'estimates', 'plans', 'assumes' or 'anticipates' or the negative thereof or other variations thereon or comparable terminology, or by discussions of, e.g. future plans, present or futureevents, or strategy that involve risks and uncertainties. Such forward-looking statements are subject to a number of risks and uncertainties, many of which are beyond the Company's control and all of which are based on the Company's current beliefs and expectations about future events. Such statements are based on current expectations and, by their nature, are subject to a number of risks and uncertainties that could cause actual results and performance to differ materially from any expected future results or performance, expressed or implied, by the forward-looking statement. No assurance can be given that such future results will be achieved; actual events or results may differ materially as a result of risks and uncertainties facing the Company and its subsidiaries. The forward-looking statements contained in this presentation speak only as of the date of this presentation and the Company undertakes no duty to, and will not necessarily, update any of them in light of new information or future events, except to the extent required by applicable law or regulation.
AGENDA
• Overview of 1H 2011, review of safety, markets and operations
– Neville Nicolau, CEO
• Review of financial performance
– Bongani Nqwababa, Finance Director
• Outlook
– Neville Nicolau, CEO
• Question and answer session
OVERVIEW OF 1H 2011
• Neville Nicolau, CEO
KEY FEATURES
• Sadly eight employees lost their lives in the first half of 2011
• Operating free cash flow increased by 159% to R4,745 million compared to 1H 2010
• Headline earnings up 26% to R3,233 million on the back of strong operational flexibility and solid PGM prices
• Interim dividend of R1.3 billion, R5.00 per share
• Refined platinum production up 17% year-on-year to 1.17 million ounces
• Cash operating costs up 13% year-on-year to R12,991 per equivalent refined platinum ounce
SAFETY
25
18
14
8 8
0.00
5.00
10.00
15.00
20.00
25.00
30.00
2007 2008 2009 2010 1H 2011
25
18
14
8 8
0.00
5.00
10.00
15.00
20.00
25.00
30.00
2007 2008 2009 2010 1H 2011
1.96
1.64
1.431.32
1.201.12
1.33
0.00
0.50
1.00
1.50
2.00
2.50
1H 2008 2H 2008 1H 2009 2H 2009 1H 2010 2H 2010 1H 2011
1.96
1.64
1.431.32
1.201.12
1.33
0.00
0.50
1.00
1.50
2.00
2.50
1H 2008 2H 2008 1H 2009 2H 2009 1H 2010 2H 2010 1H 2011
• LTIFR up 11% from 1.20 in 1H 2010 to 1.33 in 1H 2011
• Regrettably, 8 fatalities during 1H 2011
• Achieving ‘zero harm’ remains a key strategic objective
• Significant safety achievements during the 1H 2011
– Modikwa Mine: > 8 million fatality free shifts– Khuseleka mine: > 3.5 million fatality free
shifts– Tumela Mine: 1.4 million fatality free shifts– Mogalakwena: 1 million fatality free shifts– Precious metal refinery – 21 fatality free
years
INCREASE IN FATALITIES IS REGRETTABLE, JOURNEY TO Z ERO HARM STILL INTACT
Lost-time injury frequency rate: down 32% since 1H 2008
Number of fatalities: down 68% since 2007
REVIEW OF MARKETS
500
700
900
1100
1300
1500
1700
1900
2100
2300
Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11
US
$/oz
Pt price Average Pt price - 1H 2007 Average Pt price - 1H 2008
Average Pt price - 1H 2009 Average Pt price - 1H 2010 Average Pt price - 1H 2011
500
700
900
1100
1300
1500
1700
1900
2100
2300
Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11
US
$/oz
Pt price Average Pt price - 1H 2007 Average Pt price - 1H 2008
Average Pt price - 1H 2009 Average Pt price - 1H 2010 Average Pt price - 1H 2011
10,000
12,000
14,000
16,000
18,000
20,000
22,000
24,000
Feb-09 Jun-09 Oct-09 Feb-10 Jun-10 Oct-10 Feb-11 Jun-11
Ran
d pe
r pl
atin
um o
unce
ZAR basket price Average basket price - 1H 2010 Average basket price - 1H 2011
`
10,000
12,000
14,000
16,000
18,000
20,000
22,000
24,000
Feb-09 Jun-09 Oct-09 Feb-10 Jun-10 Oct-10 Feb-11 Jun-11
Ran
d pe
r pl
atin
um o
unce
ZAR basket price Average basket price - 1H 2010 Average basket price - 1H 2011
`
• Average platinum price increased 12% to US$1,782/oz in 1H 2011 compared to 1H 2010
• Realised average rand platinum basket price increased to R20,194, +5% year-on-year
REALISED BASKET PRICE CONTINUES TO IMPROVE DESPITE STRENGTHENING RAND
Source: Johnson Matthey and Anglo American Platinum
Spot platinum price and annual averages
Anglo American Platinum’s realised basket price
Year-on-year changes in commodity prices
US$ prices Rand prices
Platinum 12% 2%
Palladium 68% 53%
Rhodium -13% -19%
Gold 23% 10%
Nickel 21% 11%
Copper 39% 27%
Basket price 15% 5%
-6
-4
-2
0
2
4
6
8
10
2000
Q1
2000
Q4
2001
Q3
2002
Q2
2003
Q1
2003
Q4
2004
Q3
2005
Q2
2006
Q1
2006
Q4
2007
Q3
2008
Q2
2009
Q1
2009
Q4
2010
Q3
2011
Q2
2012
Q1
2012
Q4
% c
hang
e
World Advanced economies Emerging economies-6
-4
-2
0
2
4
6
8
10
2000
Q1
2000
Q4
2001
Q3
2002
Q2
2003
Q1
2003
Q4
2004
Q3
2005
Q2
2006
Q1
2006
Q4
2007
Q3
2008
Q2
2009
Q1
2009
Q4
2010
Q3
2011
Q2
2012
Q1
2012
Q4
% c
hang
e
World Advanced economies Emerging economies
0
5
10
15
20
25
30
35
40
45
50
2007 2008 2009 2010 2011 2012 2013
No
of v
ehic
les
per
regi
on
0
10
20
30
40
50
60
70
80
90
100
Tot
al n
umbe
r of
veh
icle
s
EU China Japan NA ROW Total
0
5
10
15
20
25
30
35
40
45
50
2007 2008 2009 2010 2011 2012 2013
No
of v
ehic
les
per
regi
on
0
10
20
30
40
50
60
70
80
90
100
Tot
al n
umbe
r of
veh
icle
s
EU China Japan NA ROW Total
AUTOCATALYST DEMAND TO REMAIN SOLID
• Global vehicle production to increase by 3% to over 75 million units in 2011
– All markets expected to grow significantly, except Japan
• Japanese earthquake had short term impact on vehicle markets
– No adjustment to our PGMs delivery schedules
– Recovery expected by 2Q 2012
• In Europe, the diesel proportion of production continues to increase
– German vehicle production continues to grow due to robust exports and domestic demand
• Gross platinum demand in the autocatalyst segment is expected to grow further in 2011
IMF’s regional GDP forecasts
Global Insights worldwide vehicle production foreca sts
Source: IMF and IHS Global Insights
0
500
1000
1500
2000
2500
Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11
US
$/oz
0.0
0.5
1.0
1.5
2.0
2.5
Pt:A
ura
tio
Pt Price Gold Price Pt/Au ratio
0
500
1000
1500
2000
2500
Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11
US
$/oz
0.0
0.5
1.0
1.5
2.0
2.5
Pt:A
ura
tio
Pt Price Gold Price Pt/Au ratio
0
20
40
60
80
100
120
140
Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11
Kg
('000
)
SGE Total Sales (oz) Monthly Average - 2008 (oz)Monthly Average - 2009 (oz) Monthly Average - 2010 (oz)Monthly Average - 1H 2011 (oz)
0
20
40
60
80
100
120
140
Jan-08 May-08 Sep-08 Jan-09 May-09 Sep-09 Jan-10 May-10 Sep-10 Jan-11 May-11
Kg
('000
)
SGE Total Sales (oz) Monthly Average - 2008 (oz)Monthly Average - 2009 (oz) Monthly Average - 2010 (oz)Monthly Average - 1H 2011 (oz)
• Chinese jewellery sales up significantly in 1H 2011 compared to 1H 2010
• Chinese jewellers take advantage of the reduced volatility in metal pricing
• Higher gold price benefits demand for platinum jewellery
• Indian jewellery development program continues to show growth
• Hallmarking figures in the UK down on 1H 2010 levels
• Palladium jewellery demand declined in Chinese market
– Recently launched market development efforts in the US may underpin demand growth
PLATINUM JEWELLERY DEMAND BENEFITS FROM FAVOURABLE MARKET CONDITIONS
Source: Johnson Matthey. Shanghai Gold Exchange (SGE) purchases includes both industrial and jewellery purchase. * Jewellery made approx 70% of total SGE purchases in 1H 2011
Gold and Platinum Price comparison
Monthly platinum SGE purchases
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1,600,000
Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11
Cum
ulat
ive
hold
ings
(oz
)
ETFS-London ETFS-Aus ETFS-US ZKB JB iShares Source
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1,600,000
Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11
Cum
ulat
ive
hold
ings
(oz
)
ETFS-London ETFS-Aus ETFS-US ZKB JB iShares Source
• Total platinum ETF holdings increased 14% to reach a record 1.41 million ounces by end June 2011
• Net long speculative positions declined by 36% in 1H 2011
– Exhibiting a lack of general confidence in the world commodity markets
• Total palladium ETF holdings decreased by 1% to 2.2 million ounces by end June 2011
Palladium ETF positions
Platinum ETF positions
INVESTMENT DEMAND REFLECTS POSITIVELY ON THE OUTLOO K
Source: ZBK, ETF Securities, Julius Baer and Renaissance BJM
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11
Cum
ulat
ive
hold
ings
(oz
)
ETFS-London ETFS-Aus ETFS-US ZKB JB iShares Source
0
500,000
1,000,000
1,500,000
2,000,000
2,500,000
Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11
Cum
ulat
ive
hold
ings
(oz
)
ETFS-London ETFS-Aus ETFS-US ZKB JB iShares Source
• Shipments of fuel cells continue to grow substantially
• Predominantly in niche transport and stationary applications
• Global fuel cell spend forecast to increase by 11% annually to $10.2 billion in 2015
– And then nearly double to $19.0 billion in 2020
• Major automakers committed to early commercialisation of light duty fuel cell vehicles by 2015
• Electric power generation-related fuel cell sales continue to grow at a brisk pace through 2020 due to:
– Relatively low barriers of entry and;
– Much greater fuel efficiency compared to conventional power generation methods
The different applications of fuel cells
FUEL CELL TECHNOLOGIES AT THE TIPPING POINT OF COMMERCIALISATION
Source: Display Search
OPERATIONAL REVIEW
1,000
1,050
1,100
1,150
1,200
1,250
1,300
1,196 12 -43 -4 1,161
1.0% -3.6% -0.3% -2.9%
1H 2010 Own mines JVs Purchases 1H 2011E
quiv
alen
t ref
ined
pla
tinum
oun
ces
('000
)
1,000
1,050
1,100
1,150
1,200
1,250
1,300
1,196 12 -43 -4 1,161
1.0% -3.6% -0.3% -2.9%
1H 2010 Own mines JVs Purchases 1H 2011E
quiv
alen
t ref
ined
pla
tinum
oun
ces
('000
)
REFINED PRODUCTION AND SALES VOLUMES UP STRONGLY
• Higher sales volumes of refined platinum delivered at a time of strong metal prices
• Refined platinum production up 17% to 1.17 moz in 1H 2011
• Equivalent refined platinum production down 3% to 1.16 moz in 1H 2011
• Wholly own mines’ platinum production increased by 2% to 763 koz in 1H 2011
• Mogalakwena continued to perform strongly providing a truly unique and flexible production source
• Refined production and sales volume target for 2011 is unchanged at 2.6 moz
Equivalent refined platinum production
452
491
454 452 454
488 491
100
200
300
400
500
600
1H 2008 2H 2008 1H 2009 2H 2009 1H 2010 2H 2010 1H 2011
R/t
452
491
454 452 454
488 491
100
200
300
400
500
600
1H 2008 2H 2008 1H 2009 2H 2009 1H 2010 2H 2010 1H 2011
R/t
COST MANAGEMENT INITIATIVES TO INTENSIFY
Cash operating cost per equivalent refined Pt oz
Cash on-mine cost per tonne milled
• Cash operating costs per equivalent refined platinum ounce increased by 13% to R12,991 in 1H 2011
– Impact of inflation: 4.3%
– Impact of costs above inflation: 4.5%
– Impact of volume: 4.2%
• Cash on-mine cost per tonne up 8% to R491 in 1H 2011
• 2H 2011 unit cost target remains unchanged at around R12,000 per equivalent refined platinum ounce
• Revising our 2011 unit cost target to between R12,400 and R12,600 to reflect challenges experienced in 1H 2011
10,594
11,517
10,775
11,736 11,49311,945
12,991
12,000
2,000
4,000
6,000
8,000
10,000
12,000
14,000
1H 2008 2H 2008 1H 2009 2H 2009 1H 2010 2H 2010 1H 2011 2H 2011F
R/o
z
10,594
11,517
10,594
11,517
10,775
11,736 11,49311,945
12,991
12,000
2,000
4,000
6,000
8,000
10,000
12,000
14,000
1H 2008 2H 2008 1H 2009 2H 2009 1H 2010 2H 2010 1H 2011 2H 2011F
R/o
z
63% OF ANGLO AMERICAN PLATINUM’S PRODUCTION IN LOWE R HALF OF THE INDUSTRY COST CURVE AT THE END 2010
Source: Source: Based on Interim results released (or Annual results as the case might be) and annualised (where necessary) to represent a full year view. The graph depicts the Pt Price required per Pt oz to breakeven based on Operating costs and total capex. Operating costs: On and Off mine Costs net-off with by-product revenues. (Pd Rh Au Ni Cu). Twickenham and Unki Mine are not shown as they are still in project phase.
RS
The
mbe
lani
Min
e
RS
Khu
sele
kaM
ine
RS
Kho
man
ani
Min
e
RS
Sip
hum
elel
eM
ine
AS
Dis
haba
Min
e
Uni
on M
ine
Mog
alak
wen
aM
ine
RS
Bat
hope
leM
ine
AS
Tum
ela
Min
e
5,000,000
$ 0
$ 200
$ 400
$ 600
$ 800
$ 1,000
$ 1,200
$ 1,400
$ 1,600
$ 1,800
$ 2,000
2,500,000
$ 2,200
3,500,000
$ 2,600
4,000,000 4,500,000
$ 1,
611
Ave
rage
Pt P
rice
$ 2,400
2,000,0001,500,0001,000,000500,000 3,000,000
Q1 Q2 Q3 Q4
Own Mines JV Mines Competitor Mines
RS
The
mbe
lani
Min
e
RS
Khu
sele
kaM
ine
RS
Kho
man
ani
Min
e
RS
Sip
hum
elel
eM
ine
AS
Dis
haba
Min
e
Uni
on M
ine
Mog
alak
wen
aM
ine
RS
Bat
hope
leM
ine
AS
Tum
ela
Min
e
5,000,000
$ 0
$ 200
$ 400
$ 600
$ 800
$ 1,000
$ 1,200
$ 1,400
$ 1,600
$ 1,800
$ 2,000
2,500,000
$ 2,200
3,500,000
$ 2,600
4,000,000 4,500,000
$ 1,
611
Ave
rage
Pt P
rice
$ 2,400
2,000,0001,500,0001,000,000500,000 3,000,000
Q1 Q2 Q3 Q4Q1 Q2 Q3 Q4
Own Mines JV Mines Competitor Mines
RS
The
mbe
lani
Min
e
RS
Khu
sele
kaM
ine
RS
Kho
man
ani
Min
e
RS
Sip
hum
elel
eM
ine
AS
Dis
haba
Min
e
Uni
on M
ine
Mog
alak
wen
aM
ine
RS
Bat
hope
leM
ine
AS
Tum
ela
Min
e
5,000,000
$ 0
$ 200
$ 400
$ 600
$ 800
$ 1,000
$ 1,200
$ 1,400
$ 1,600
$ 1,800
$ 2,000
2,500,000
$ 2,200
3,500,000
$ 2,600
4,000,000 4,500,000
$ 1,
611
Ave
rage
Pt P
rice
$ 2,400
2,000,0001,500,0001,000,000500,000 3,000,000
Q1 Q2 Q3 Q4Q1 Q2 Q3 Q4
Own Mines JV Mines Competitor Mines
RS
The
mbe
lani
Min
e
RS
Khu
sele
kaM
ine
RS
Kho
man
ani
Min
e
RS
Sip
hum
elel
eM
ine
AS
Dis
haba
Min
e
Uni
on M
ine
Mog
alak
wen
aM
ine
RS
Bat
hope
leM
ine
AS
Tum
ela
Min
e
5,000,000
$ 0
$ 200
$ 400
$ 600
$ 800
$ 1,000
$ 1,200
$ 1,400
$ 1,600
$ 1,800
$ 2,000
2,500,000
$ 2,200
3,500,000
$ 2,600
4,000,000 4,500,000
$ 1,
611
Ave
rage
Pt P
rice
$ 2,400
2,000,0001,500,0001,000,000500,000 3,000,000
Q1 Q2 Q3 Q4Q1 Q2 Q3 Q4
Own Mines JV Mines Competitor Mines
IMPROVEMENT IN LABOUR PRODUCTIVITY TO CONTINUE DESPITE A MINOR SETBACK IN 1H 2011
• Labour productivity declined by 18% to 5.88m2 in 1H 2011
• Remedial actions to improve safety and labour productivity
– Implement safety strategies to improve workplace conditions
– Increase development and equipping to improve flexibility
– Focus on people management and wellness to ensure full strength and effective teams
• 2H 2011 labour productivity target is unchanged at 7.3m2
• Revising our 2011 target to 6.6m2 to reflect lower than expected labour productivity in 1H 2011
Labour productivity profile
5.515.86
6.29 6.46
7.15 6.98
5.88
7.30
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
8.00
1H 2008 2H 2008 1H 2009 2H 2009 1H 2010 2H 2010 1H 2011 2H 2011F
Squ
are
met
res
5.515.86
6.29 6.46
7.15 6.98
5.88
7.30
0.00
1.00
2.00
3.00
4.00
5.00
6.00
7.00
8.00
1H 2008 2H 2008 1H 2009 2H 2009 1H 2010 2H 2010 1H 2011 2H 2011F
Squ
are
met
res
3.23.33.43.43.3
3.2 3.1
80
7775
74
78 7877
1.0
1.5
2.0
2.5
3.0
3.5
4.0
1H 2008 2H 2008 1H 2009 2H 2009 1H 2010 2H 2010 1H 2011
g/t
65
67
69
71
73
75
77
79
81
%
Built up head grade (4E) UG2 tonnes milled to total Merensky and UG2
3.23.33.43.43.3
3.2 3.1
80
7775
74
78 7877
1.0
1.5
2.0
2.5
3.0
3.5
4.0
1H 2008 2H 2008 1H 2009 2H 2009 1H 2010 2H 2010 1H 2011
g/t
65
67
69
71
73
75
77
79
81
%
Built up head grade (4E) UG2 tonnes milled to total Merensky and UG2
2.6
2.93.0
2.52.5
2.7
2.9
1.8
2.0
2.2
2.4
2.6
2.8
3.0
3.2
1H 2008 2H 2008 1H 2009 2H 2009 1H 2010 2H 2010 1H 2011
g/t
2.6
2.93.0
2.52.5
2.7
2.9
1.8
2.0
2.2
2.4
2.6
2.8
3.0
3.2
1H 2008 2H 2008 1H 2009 2H 2009 1H 2010 2H 2010 1H 2011
g/t
GRADES SET TO IMPROVE FURTHER IN 2011
• Group built-up head grade increased slightly
– Despite an increase in the processing of low grade surface stockpiles
– Mogalakwena was key contributor to the improvement in head grade
• Built-up head grade expected to improveslightly in 2H 2011
• Mogalakwena’s built-up head grade increased by 15% to 2.9 g/t due to:
– Deepening of the new North pit
– Selective mining of high grade ore benches
Mogalakwena mine’s built-up (4E) head grade
Group built-up head grade vs. UG2%
REVIEW OF FINANCIAL PERFORMANCE
• Bongani Nqwababa, Finance Director
RESUMPTION OF INTERIM DIVIDEND TESTIMONY TO IMPROVED FINANCIAL PERFORMANCE
R million 1H 2011 1H 2010 Change
Basket price per Pt oz ($) 2,927 2,540 15% �
Basket price per Pt oz (R) 20,194 19,165 5% �
Net sales revenue 24,805 20,783 19% �
EBITDA 6,700 5,834 15% �
Operating profit 4,752 3,777 26% �
Headline earnings 3,233 2,559 26% �
Headline earnings per share (cents) 1,236 1,028 20% �
Ordinary dividends 1,306 – 100% �
Ordinary dividends per share (cents) 500 – 100% �
Operating free cash flow 4,745 1,831 159% �
Capital expenditure (excl. interest capitalised) 2,828 2,840 - -
Net debt 4,350 8,245 47% �
HEADLINE EARNINGS UP STRONGLY DUE TO METAL PRICE RECOVERY AND HIGHER SALES VOLUME
0
1,000
2,000
3,000
4,000
5,000
6,000
2,559 2,624 -1,555 -288 1,874 -113 -1,957 -12 111 -68 58 3,233
H1 2010 Price Exchange Inflation Sales volume Costs Stock movement
Depreciation Net interest Associates Other H1 2011
Rm
COST MANAGEMENT A CHALLENGE AND OPERATING MARGINS BENEFITED FROM STRONG PRICES
1 Cash operating costs comprise on-mine, smelting and refining costs
R million 1H 2011 1H 2010 Change
Cash operating costs 1 11,827 10,855 9% �
Other costs 1,221 1,139 7% �
Purchase of metals and leasing activities 4,355 4,846 10% �
Depreciation and waste stripping 2,159 2,152 0% �
Cost of sales 20,038 16,817 19% �
Margins 2 1H 2011 2H 2010 Change
Gross profit margin 19% 16% 19% �
Headline earnings margin 13% 9% 44% �
2 Margins are compared to 2H 2010 for better comparability following labour wage increases in 2H 2010 and pipeline build up in 1H 2010.
CONTINUOUS FOCUS ON COST MANAGEMENT
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
11,493 490 465 265 278 12,991
4.3% 4.0% 2.3% 2.2%
H1 2010 Inflation Production Utilities Other operating costs
H1 2011
Ran
d p
er e
quiv
alen
t ref
ined
Pt o
unce
STRONG OPERATING FREE CASH FLOW ALLOWING FOR DIVIDEND PAYMENT OUT OF OPERATING ACTIVITIES
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
1,831 4,531 -1,721 104 4,745
H1 2010 Cash receipts from customers Cash paid to suppliers and employees
SIB capex H1 2011
Ope
ratin
g fre
e ca
shflo
w (R
m)
Asset Optimisation:Main contributing projects
● Smelter capacity improvements and increased utilisation● Rustenburg central services labour savings● Siphumelele 3 care and maintenance● Rustenburg concentrator recovery projects● Union concentrator cost savings
Supply Chain:Main contributing projects
● Mogalakwena Cat Fleet Disposal ● Explosives – AEL shocktubes ● Steel balls and grinding media contracts● Shell Asset Infrastructure upgrade● Resource allocation tool (labour initiative) ● Reduction in tyre inventory at Mogalakwena
CONTINUED DELIVERY FROM ASSET OPTIMISATION AND SUPPLY CHAIN
*Including joint ventures, intercompany transactions and working capital
OUTLOOK
• Outlook
– Neville Nicolau, CEO
• Question and answer session
2H 2011 OUTLOOK CONTINUES TO BE POSITIVE
• Platinum market to remain in balance
• Platinum price to average at least US$1,800 per ounce
– Current Rand basket price is inadequate to incentivise sustainable investment to secure future supply
• Refined production and sales volume target for 2011 remains unchanged at 2.6 moz of platinum
• 2H 2011 unit cash cost is unchanged at around R12,000 per equivalent refined platinum ounce
– Revising our 2011 unit cost target to between R12,400 and R12,600 to reflect higher than expected unit cost in 1H 2011
• 2H 2011 labour productivity target is unchanged at 7.3m2
– Revising our 2011 target to 6.6m2 to reflect lower than expected labour productivity in 1H 2011
• Revising our CAPEX target for 2011 from R8 billion to R7.3 billion
• CAPEX: Projects: R3.8 billion, SIB: R3.0 billion, Waste-stripping R0.5 billion
• Reflects positively on the effectiveness of our improved project ranking and prioritization model
BEYOND 2011: UG2 MINING IN RUSTENBURG PROVIDES US W ITH AN OPPORTUNITY TO LEVERAGE OFF OUR ASSET BASE
Surface outcrop decline shaft access
First generationvertical shaft
Second and third generation shafts
Merensky reef4-6 g/t, narrow width
‘Short’ distance betweenreefs 40 – 100m
UG2 reef3-5 g/t, wide, high
Chrome
Anglo Platinum ‘typical’ Impala Platinum ‘typical’
Brownfields projectCo-extraction
Average Depth 0 – 1200m
mined outreef
Southern African
BushveldPlatinum mining
Surface outcrop decline shaft access
First generationvertical shaft
Second and third generation shafts
Merensky reef4-6 g/t, narrow width
‘Short’ distance betweenreefs 40 – 100m
UG2 reef3-5 g/t, wide, high
Chrome
Anglo Platinum ‘typical’ Impala Platinum ‘typical’
Brownfields projectCo-extraction
Average Depth 0 – 1200m
mined outreef
Southern African
BushveldPlatinum mining
Anglo American Platinum“typical”
BEYOND 2011: OTHER OPPORTUNITIES
Rationale
Source: * Commercial Strategy and Fact Base 2009
Options
• Only true pen pit platinum mine and one of the most profitable • Improved our capacity to process the very difficult Platreef ore• This is a relatively low cost, low risk project with a massive orebody
• Low cost mine with second largest LOM (~73yrs) after Mogalakwena• Lower capital intensity• Working with Government to resolve the Mining Rights issues
• Rustenburg mines currently under-utilising hoisting capacity• 80% of remaining platinum reserves in Rustenburg are UG2• Rustenburg UG2 is shallower and less capital intensive• Lower operating cost to offset negative impact of lower grade
• Have an extensive and undeveloped footprint on the Eastern Limb• Value creation through development of the Eastern Limb projects• Projects that will help us grow and match our resource base of around 50%
• Have multiple deep shaft opportunities, mainly on the Western Limb• Can be developed with good incentive prices Western Limb life extension• Today’s economics render these as marginal
Rustenburg Mines UG2
Optimisation
Optimise Mogalakwena
Potential
Unki Potential
Eastern Limb Option
Deep Shaft Projects
1
2
3
4
5
OUR STRATEGY
Our strategy is to maximise value by understanding and developing the market for platinum group metals, to expand our pro duction into that
opportunity and to conduct our business safely,cost-effectively and competitively
Safe, Profitable Platinum
THANK YOU
