UPDATE 1-AngloGold’s profits dip, sees unchanged output in Q2

* Q1 adj headline EPS falls to 17 US cts v 62 US cts in Q4

* Q1 gold output at 1.08 mln oz v 1.182 mln oz in Q4

* Q2 production forecast at 1.079 mln oz

* Hedge book slashed by 350,000 oz to 3.55 mln oz

(Adds CEO, details)

JOHANNESBURG, May 7 (BestGrowthStock) – AngloGold Ashanti (ANGJ.J: ),
the world’s 3rd-largest listed gold miner, posted first quarter
earnings below market consensus due to low output in South
Africa and forecast unchanged production in the second quarter.

AngloGold, which has around 20 operations across four
continents, said production fell due to the Christmas break and
safety stoppages and reported adjusted headline earnings of 17
U.S. cents from 62 U.S. cents in the December quarter.

The company said its fourth quarter earnings had also been
boosted by a one-off $65 million foreign exchange gain.

Market consensus for an adjusted headline earnings of 20
U.S. cents per share. [ID:nLDE64315Z]

South African gold producers, which sell their gold in
dollars and pay their costs in rand, saw little benefit from the
metal’s price, which has rescued them even when output has been
low, because the gain on the gold price was muted.

A strong performance from its mines in Tanzania and the
Americas helped offset the lower production from South Africa.

“Our operations in Brazil and Argentina had another strong
quarter and the turnaround progress in the U.S. and Tanzania was
very encouraging,” Chief Executive Officer Mark Cutifani said.

“We’ve got an incredible slate of new projects in the
Americas, Africa and Australasia. Our focus is squarely on
developing the potential that exists within our portfolio.”

Africa’s top three gold producers – AngloGold, Gold Fields
(GFIJ.J: ) and Harmony Gold Mining Co. (HARJ.J: ) — were expected
by analysts to post weaker March quarter earnings largely due to
lower production and rising costs against a marginal rise in the
dollar and rand price of bullion.

Gold Fields reported lower earnings and production, Harmony
reports on Monday. [ID:nWEA0770]

AngloGold, which is the biggest gold producer in Africa,
said it slashed its forward sales by a further 350,000 ounces
during the quarter, leaving total commitments of 3.55 million
ounces by end March. The hedge book would be slashed by a
further 280,000 ounces by the end of the year, the group said.

For the current quarter, the companies are facing higher
costs due to increased power tariffs and a new royalty payment
that will pile onto their cost base. [ID:nWEB0627]
[ID:nLDE61N0HE]

Investing

(Reporting by James Macharia)

UPDATE 1-AngloGold’s profits dip, sees unchanged output in Q2