Ashanti Goldfields Company Limited interim results - period ending 31 March 1996.ACCRA Accra (əkrä`, ăk`rə), city (1984 pop. 867,459), capital of Ghana, a port on the Gulf of Guinea. It is Ghana's largest city and its administrative, communications, and economic center. , Ghana--(BUSINESS WIRE)--June 11, 1996--Ashanti Goldfields n. 1. A small slender woolly annual (Lasthenia chrysostoma) with very narrow opposite leaves and branches bearing solitary golden-yellow flower heads; it grows from Southwestern Oregon to Baja California and Arizona; - it is often cultivated. Co. Ltd. (NYSE NYSE See: New York Stock Exchange : ASL ASL - Algebraic Specification Language ) today announced interim results for the six months ended March 31, 1996. Highlights of the release are as follows: -- Group gold production for the first six months amounted to 490,138 ounces and represented a 5.5% increase over the comparable period for the previous financial year. This included 38,880 ounces from the operations of Cluff in the period since January January: see month. 1996, of which 25,264 ounces were from the Zimbabwe Zimbabwe, ruined city, Zimbabwe Zimbabwe (zĭmbäb`wā) [Bantu,=stone houses], ruined city, SE Zimbabwe, near Fort Victoria. It was discovered by European explorers c. operations (mainly the Freda-Rebecca mine) and 13,616 ounces were from the Ayanfuri mine in Ghana Ghana, country, Africa Ghana, officially Republic of Ghana, republic (2005 est. pop. 21,030,000), 92,099 sq mi (238,536 sq km), W Africa, on the Gulf of Guinea, an arm of the Atlantic Ocean. The capital and largest city is Accra. . -- During the first six months, there was a net increase in the underground resource of 4.4 million tonnes, with a gold content of 1.05 million ounces. -- Group turnover was US$224.4 million versus US$192.5 million in 1995. -- Group profit after tax was US$46.5 million, 3% lower than the first half of the previous financial year. -- Earnings per share were US$0.53 (1995: US$0.57) -- Ashanti's hedging programme realized an average gold price equivalent to US$448 per ounce ounce, in zoology ounce, in zoology: see leopard. ounce, unit of measurement ounce: see English units of measurement. . This was US$54 per ounce higher than the spot price, which averaged US$394 per ounce over the six months period. -- Cash operating costs operating costs npl → gastos mpl operacionales for the group averaged US$234 per ounce, up from $US208 per ounce in the previous full year. -- The board has declared an interim dividend of US$0.125 per share (1995: US$0.125) to be paid on 11 September September: see month. 1996 to shareholders on the register on 28 August 1996. -- The board has decided to change the company's financial year end to 31 December December: see month. to bring it in line with its peer group of international mining companies. Ashanti's current financial year will, therefore, be extended by three months to 31 December 1996 and the results for the 15 months to that date will be announced in March 1997. "1996 is set to become a milestone year for Ashanti Ashanti (äshän`tē) or Asante (äsän`tē), historic and modern administrative region, central Ghana, W Africa. The region is the source of much of Ghana's cocoa. , a year in which it will have been transformed from a gold producer with a single mine in Ghana to a group with several operating mines, major development projects and an exploration portfolio that includes land positions on each of the most promising gold mineralization Mineralization The process by which the body uses minerals to build bone structure. Mentioned in: Rickets mineralization, n the bioprecipitation of an inorganic substance. belts of sub-Saharan sub-Sa·har·an adj. Of, relating to, or situated in the region of Africa south of the Sahara. Adj. 1. sub-Saharan - of or relating to or situated in the region south of the Sahara Desert Africa," said Sam E. Jonah Sam E Jonah (KBE) is the Executive Chairman of Jonah Capital, a private equity fund based in Johannesburg, South Africa. Mr Jonah was previously President of AngloGold Ashanti and shared the strategic leadership of the company with its CEO, Bobby Godsell. , chief executive. For additional information, please call Allan Allan can refer to:
Jordan, officially Hashemite Kingdom of Jordan, kingdom (2005 est. pop. 5,760,000), 35,637 sq mi (92,300 sq km), SW Asia. It borders on Israel and the West Bank in the west, on Syria in the north, on Iraq in the northeast, and on Saudi at (212) 309-0613. -0- ASHANTI GOLDFIELDS COMPANY LIMITED INTERIM RESULTS - PERIOD ENDING 31 MARCH 1996 "1996 is set to become a milestone year for Ashanti, a year in which it will have been transformed from a gold producer with a single mine in Ghana to a group with several operating mines, major development projects and an exploration portfolio that includes land positions on each of the most promising gold mineralisation belts of sub-Saharan Africa." Sam (1) (Security Accounts Manager) The part of Windows NT that manages the database of usernames, passwords and permissions. A SAM resides in each server as well as in each domain controller. See PDC and trust relationship. E Jonah Jonah (jō`nə), prophetic book of the Bible. It tells the story of a prophet called by God to preach repentance to the city of Nineveh. According to the Second Book of Kings, Jonah lived during the reign (c.786 B.C.–c.746 B.C. Chief Executive Highlights -- Acquisition of Cluff Resources Plc -- Acquisition of International Gold Resources Corporation and GLAMCO in final stages -- Proposed merger with Golden Shamrock shamrock, a plant with leaves composed of three leaflets. According to legend it was used by St. Patrick in explaining the doctrine of the Trinity; it is now used as the emblem of Ireland. An artificial or real shamrock leaf is customarily worn on St. Patrick's Day. Mines -- Group gold production up 5.5% -- Net increase of one million ounces in underground resources at Obuasi Obuasi (ōbwä`sē), town (1984 pop. 60,617), S central Ghana. Highly concentrated gold ore is mined, and there are gold-extraction plants. Gold was mined in Obuasi by indigenous peoples as early as the 17th cent. -- Earnings per share US$0.53 (1995: US$0.57) -- Interim dividend US$0.125 (1995: US$0.125) Overview The first six months of the current year have been a period of rapid corporate development, such that 1996 is set to become a milestone year for Ashanti, a year in which it will have been transformed from a gold producer with a single mine in Ghana - albeit a spectacular one - to a group with several operating mines, major development projects and an exploration portfolio that includes land positions on each of the most promising gold mineralisation belts of sub-Saharan Africa. This significant broadening of our geographical and operational horizons had its genesis 18 months ago when the Board determined that, in addition to developing the Obuasi mine, Ashanti could also create substantial shareholder value by applying its core skills and financial strengths to other gold mining projects and companies in Africa. We identified Cluff Resources Plc, a UK company, International Gold Resources Corporation (IGR IGR insect growth regulator. ), a Canadian Canadian (kənā`dēən), river, 906 mi (1,458 km) long, rising in NE New Mexico. and flowing E across N Texas and central Oklahoma into the Arkansas River in E Oklahoma. company, and Golden Shamrock Mines (GSM (Global System for Mobile Communications) A digital cellular phone technology based on TDMA that is the predominant system in Europe, but also used worldwide. Developed in the 1980s, GSM was first deployed in seven European countries in 1992. ) of Australia as
adj. 1. Possessing, exerting, or displaying energy. See Synonyms at active. 2. Of or relating to energy. [Greek energ to agree terms. The acquisition of Cluff Resources, whose operations include current production at Freda-Rebecca in Zimbabwe and Ayanfuri in Ghana as well as the exciting Geita prospect in Tanzania Tanzania (tăn'zənē`ə, –zăn`ēə, Swahili tänzänē`ä), officially United Republic of Tanzania, republic (2005 est. pop. , was completed in January 1996. The acquisition of IGR with its right to earn a 45% interest in the Bibiani Bibiani is a town in Ghana. It is the capital of Bibiani Anhwiaso Bekwai district. project in Ghana, where 2.6 million ounces of measured and indicated resources have been identified, moved into its final stages in June June: see month. when its shareholders voted in favour of the proposal. The proposed merger with GSM, which has the support of its board, is currently proceeding towards a vote by its shareholders in August. GSM's assets include a producing gold mine at Iduapriem in Ghana and an open pit development project at Siguiri in neighbouring Guinea Guinea, archaic term for Africa's west coast Guinea (gĭn`ē), an archaic term for the west coast of Africa. In its widest sense it has been applied to the region from Angola to Senegal. . Negotiations have been successfully concluded to acquire GLAMCO which holds the mining rights to the Bibiani project. When the transactions are completed it will give us 90% of the project, with the remaining 10% held by the Ghana government. Bringing to fruition fru·i·tion n. 1. Realization of something desired or worked for; accomplishment: labor finally coming to fruition. 2. Enjoyment derived from use or possession. 3. four sets of merger and acquisition negotiations more or less simultaneously and in three continents has inevitably consumed con·sume v. con·sumed, con·sum·ing, con·sumes v.tr. 1. To take in as food; eat or drink up. See Synonyms at eat. 2. a. senior management time. However, we have now almost completed what we set out to achieve and we are not actively seeking any further major acquisitions. The focus now is to devote our management resources to realising the full potential of Obuasi, and developing and integrating the new companies. We are putting in place the management resources necessary to maintain a high level of expertise and efficiency across Obuasi and the new properties. We are delighted that we have successfully integrated Cluff's operational management into the Group and with the progress made in adding value to the former Cluff operations through the acceleration of exploration, financial and operational synergies. The growth of our gold exploration portfolio in Africa, which was the other major strategic decision of the Board 18 months ago, has reached a stage which gives Ashanti shareholders an interest in Africa's most promising gold fields Gold Fields Limited is one of the world’s largest unhedged producers of gold, providing investors with maximum leverage to the gold price. The company was formed in 1998 with the amalgamation of the gold assets of Gold Fields of South Africa Limited and Gencor Limited. . We have now prioritised our exploration efforts around four advanced projects, while maintaining activity on several others which are at a more grass roots grass roots pl.n. (used with a sing. or pl. verb) 1. People or society at a local level rather than at the center of major political activity. Often used with the. 2. The groundwork or source of something. stage. Results The earnings for the six months to 31 March 1996 at US$46.5 million, were close to the levels of the previous year despite the increased mining costs, exploration costs and Group administration costs. Increased revenues from gold hedging helped to offset a rise in cash operating costs at Obuasi that mainly reflected lower than planned grades. The successful issue of 51/2% Exchangeable Guaranteed Notes, which raised US$250 million shortly after Ashanti's listing on the New York Stock Exchange New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. in February, ensures that the Group has the financial strength to develop the Bibiani and Siguiri projects and to maintain an active exploration effort while maximising the potential from Obuasi and its other producing gold mines. In addition to the New York Stock Exchange listing, Ashanti has also listed on the Toronto and Zimbabwe stock exchanges The Zimbabwe Stock Exchange, or ZSE, is a small but active stock exchange in Africa. It has been open to foreign investment since 1993. It has about a dozen members and over 65 listed securities. and is planning a listing on the Australian Stock Exchange Australian Stock Exchange (ASX) Australia's major securities market, formed when the six state stock exchanges (Adelaide, Brisbane, Hobart, Melbourne, Perth, and Sydney stock exchanges) were merged in 1987. in connection with the proposed merger with GSM. The Board has declared an interim dividend of US$0.125 per share (1995: US$0.125) to be paid on 11 September 1996 to shareholders on the register on 28 August 1996. Review of Operations Group gold production for the first six months amounted to 490,138 ounces and represented a 5.5% increase over the comparable period for the previous financial year. This included 38,880 ounces from the operations of Cluff in the period since January 1996, of which 25,264 ounces were from the Zimbabwe operations (mainly the Freda-Rebecca mine) and 13,616 ounces were from the Ayanfuri mine in Ghana. Operations in Ghana Obuasi Underground mining Continued progress was achieved in the phased expansion of underground mining. The production rate in the second quarter was an annualised 1.8 million tonnes per annum Per annum Yearly. (tpa), a 28% increase from an annualised 1.4 million tpa in last year's second quarter, and in line with the plan to reach 3.5 million tpa by the end of the decade. However, delays occurred in bringing some of the new mechanised Adj. 1. mechanised - using vehicles; "motorized warfare" mechanized, motorized mobile - moving or capable of moving readily (especially from place to place); "a mobile missile system"; "the tongue is...the most mobile articulator" 2. mining blocks into production in the central section. This required the Company to draw upon material from lower grade sources. The operational balance and flexibility of underground operations Underground Operations is a Toronto-based independent punk rock record label. Operated by Mark Spicoluk, former Closet Monster member, this label is one of the most cutting edge independent labels in Canada. at Obuasi have been enhanced. Projects such as the acceleration of the North Ramp development, the establishment of the Cote d'Or decline, the Timber Shaft shaft (shaft) a long slender part, such as the diaphysis of a long bone. shaft n. 1. An elongated rodlike structure, such as the midsection of a long bone. 2. rehabilitation rehabilitation: see physical therapy. and the upgrading of the Sansu Shaft facility to hoist hoist: see winch. ore, have provided access to more areas of the orebody. A project has been completed that will allow surface ore to be introduced to the Pompora Treatment Plant (PTP (1) See peer-to-peer. (2) (Picture Transfer Protocol) An ISO standard for transferring photos from a digital camera to a computer or photo printer. ) via the surface conveyor Conveyor A horizontal, inclined, declined, or vertical machine for moving or transporting bulk materials, packages, or objects in a path predetermined by the design of the device and having points of loading and discharge fixed or selective. system. This will allow the underground transport systems to be rationalised further. Other major projects designed to achieve capacity increases are being progressed. Construction of the Stonewall stone·wall v. stone·walled, stone·wall·ing, stone·walls v.intr. 1. Informal a. Shaft, which will be able to hoist 1.2 million tpa from the southern section of the mine, is scheduled for completion in 1997. We are also increasing the capacity of the Eaton Turner Shaft, which is scheduled to be closed for that purpose in the near future. These initiatives complement the 41-level rail haulage now under development and scheduled for completion in early 1998. Hydrafill and rockfill projects, designed to provide fill material for the underground mine, are to be commissioned within six months to improve operating efficiencies. Surface mining The six month period saw the rapid depletion depletion n. when a natural resource (particularly oil) is being used up. The annual amount of depletion may, ironically, provide a tax deduction for the company exploiting the resource because if the resource they are exploiting runs out, they will no longer be able of the oxide oxide, chemical compound containing oxygen and one other chemical element. Oxides are widely and abundantly distributed in nature. Water is the oxide of hydrogen. Silicon dioxide is the major component of sand and quartz. areas at Obuasi. The Company is currently reappraising all areas not yet mined in order to extend the life of the Oxide Treatment Plant (OTP (1) (One Time Programmable) Refers to programming content or logic into chips such as EPROMs and EEPROMs, which cannot be reversed. See antifuse. (2) (One Time P ). Production shortfalls were encountered in the first six months. These were mainly due to the higher than anticipated proportion of transition ore from the Anyinam pit, and to transition/sulphide grades that were lower than planned. Because the metallurgical met·al·lur·gy n. 1. The science that deals with procedures used in extracting metals from their ores, purifying and alloying metals, and creating useful objects from metals. 2. recoveries from transition ore (72%) are substantially lower than sulphide sulphide: see sulfide. ore (81%) these have a compound effect on gold production. The transition ore is now substantially mined and, therefore, this problem should not recur. B oxide resources in the open cuts are almost exhausted and, in future, the OTP will be fed by increasing percentages of transition material,which is more economic than processing it through the STP STP or standard temperature and pressure, standard conditions for measurement of the properties of matter. The standard temperature is the freezing point of pure water, 0°C; or 273.15°K;. . The Tailings Tailings (also known as tailings pile, tails, leach residue, or slickens[1]) are the materials left over[2] after the process of separating the valuable fraction from the worthless fraction of an ore. Treatment Plant and the Heap In programming, it refers to a common pool of memory that is available to the program. The management of the heap is either done by the applications themselves, allocating and deallocating memory as required, or by the operating system or other system program. 1. Leach facility both fulfilled ful·fill also ful·fil tr.v. ful·filled, ful·fill·ing, ful·fills also ful·fils 1. To bring into actuality; effect: fulfilled their promises. 2. expectations. The capacity of the STP at Obuasi is being further increased to meet future requirements of underground production. In addition to the STP expansion to 240,000 tonnes per month, the PTP is now being expanded to 135,000 tonnes per month by early 1997. Ore reserve delineation During the first six months, there was a net increase in the underground resource of 4.4 million tonnes, with a gold content of 1.05 million ounces. We are confident that in the medium term there wiRebecca mine has the resource potential to support an expansion beyond the basic plan of 90,000 tonnes per month from its underground mining operations. An interim technical consolidation of the plant process to improve recoveries further is being engineered. Exploration continued to define further the Freda-Rebecca mineralised shears shears cutting instruments for the removal of wool—sheep shears, or for trimming the hooves of sheep and goats—hoof shears. hoof shears a rugged pair of shears like secateurs but with sharp-pointed blades. . Trenching has been undertaken at the Pen- Kimberley claims near the Freda-Rebecca mine and drilling of the target has commenced. Exploration Ashanti consolidated its exploration activities with the signing of a number of licences during the period. Ashanti is now active in ten African countries, with the main thrusts of exploration being in Tanzania, Guinea, Senegal and Niger. In West Africa West Africa A region of western Africa between the Sahara Desert and the Gulf of Guinea. It was largely controlled by colonial powers until the 20th century. West African adj. & n. , much of the exploration is being undertaken as part of a joint venture alliance agreement with the Canadian mining company, AGEM/IAMGOLD. Tanzania Ashanti's activities in Tanzania centre on Geita, previously East Africa's largest gold mine, where some 900,000 ounces were produced before its closure in 1966. Exploration is being focused on the 4km long banded ironstone ironstone a natural ore which may contain significant amounts of fluorine and cause fluorosis in cattle grazing pastures in the vicinity of a factory which calcines the ore. formation pally pal·ly adj. pal·li·er, pal·li·est Informal Friendly; chummy. pally Adjective [-lier, -liest] Informal on friendly terms Adj. from gold bullion Gold bullion Investment-grade, pure gold, which may be smelted into gold coins or gold bars. sales. Ashanti's hedging programme realised an average gold price equivalent to US$448 per ounce. This was US$54 per ounce higher than the spot price, which averaged US$394 per ounce over the six months period. The Group's hedging programme aims to provide a high floor price for Group gold production, while maximising the possibility for the Company to benefit from movements in the gold price above that floor. Consistent with these objectives, Ashanti adjusts its overall hedge position to respond to market developments. In late 1995, the gold market experienced a period of backwardation Backwardation The theory that says futures prices will tend to rise over the life of a contract. Therefore the near-term contracts trade at a higher price than the longer-term contracts. Notes: This is the opposite of "contango. which caused several of Ashanti's long-dated forward positions to move substantially into profit. Ashanti realised profits by closing out these positions, which contributed towards the high realised gold price during the period under review. Subsequently, the Company replaced the contracts with new forward positions during and after the rally in the gold price in early 1996. At 31 March 1996, Ashanti's forward sales forward sales npl → ventas fpl a término book stood at about 4.1 million ounces, at an average contracted price of US$432 per ounce. Most of these contracts (3.5 million ounces) are spot deferred sales, with final maturities of up to ten years, which give flexibility to defer de·fer 1 v. de·ferred, de·fer·ring, de·fers v.tr. 1. To put off; postpone. 2. To postpone the induction of (one eligible for the military draft). v.intr. delivery in order to benefit from surges in the gold price. In addition, Ashanti had sold outstanding call option contracts covering about 1.1 million ounces that expire expire /ex·pire/ (ek-spi´er) 1. to exhale. 2. to die. ex·pire v. 1. To breathe one's last breath; die. 2. To exhale. over the next five years at an average strike price of US$459 per ounce. The total hedging positions of 5.4 million ounces represent less than 25% of Ashanti's reserve position of about 22 million ounces. Costs Cash operating costs for the Group averaged US$234 per ounce, up from US$208 per ounce in the previous full year. The Obuasi underground operation's cash costs were US$225 per ounce, up from US$202 per ounce in the previous full year. Significant productivity gains were made, which reduced mining costs per tonne tonne measure of weight or mass; 1 tonne=1000 kg. See also ton. by 10% year-on-year. These were outweighed by a 22% reduction in grade, due to the delays in bringing mechanised blocks into production. Obuasi's surface mining operations registered a sharp rise in cash costs, from US$224 per ounce in the previous full year to US$258 per ounce, which was the single largest cause of the overall rise in costs for the Group. The surface mine has moved onto a higher cost level, as the low-cost oxide ores (which will be fully depleted de·plete tr.v. de·plet·ed, de·plet·ing, de·pletes To decrease the fullness of; use up or empty out. [Latin d by the end of 1996) have given way to harder and refractory refractory Material that is not deformed or damaged by high temperatures, used to make crucibles, incinerators, insulation, and furnaces, particularly metallurgical furnaces. sulphide ores which are more expensive to mine and to treat. The rise in costs was increased by the unanticipated presence, in the first six months, of transition ore with markedly lower grades and recoveries. Other contributory con·trib·u·to·ry adj. 1. Of, relating to, or involving contribution. 2. Helping to bring about a result. 3. Subject to an impost or levy. n. pl. factors to the cost increase were a marked rise in cyanide cyanide (sī`ənīd'), chemical compound containing the cyano group, -CN. Cyanides are salts or esters of hydrogen cyanide (hydrocyanic acid, HCN) formed by replacing the hydrogen with a metal (e.g., sodium or potassium) or a radical (e.g. costs, and the build-up build·up also build-up n. 1. The act or process of amassing or increasing: a military buildup; a buildup of tension during the strike. 2. of ore stockpiles for processing in later time periods. The transition ore is now substantially mined out and this problem will not recur. The tailings retreatment operation at Obuasi had cash costs of US$111 per ounce. The average cash costs of the Freda-Rebecca and Ayanfuri mines were US$224 per ounce. Depreciation Depreciation increased to US$34.4 million (1995: US$25.8 million), mainly because, under the unit of production method of depreciation, the steady depletion of the surface ore reserves at Obuasi led to an acceleration of the write-off Write-Off A reduction in the value of an asset or earnings by the amount of an expense or loss. Companies are able to write off certain expenses that are required to run the business, or have been incurred in the operation of the business and detract from retained revenues. of surface mining assets. Profit Operating profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. of US$50.3 million (1995: US$52.7 million) is analysed by business areas in Note 3 to the accounts. Obuasi operations generated operating profit of just over US$59 million, about the same level as in the prior year. The increase in the realised gold price offset the increase in cash costs and in deapproximately ten and six weeks earlier respectively, in relation to the end of the first and second half of the financial year, than at present. The final dividend for the current year will be payable in April 1997. Outlook During the rest of the financial period to 31 December 1996 the Group will focus on concluding the proposed merger with GSM and completion, and consolidating the acquisitions of Cluff, IGR and GLAMCO to enhance shareholder value. Sam E Jonah Chief Executive -0- Consolidated Profit and Loss Account
6 months 6 months 12 months
to to to
31 March 31 March 30 Sept
1996 1995 1995
million million million
US$ US$ US$
Notes (unaudited) (unaudited)
-----------------------------------------------------------------------
Turnover 1 224.4 192.5 387.7
-----------------------------------------------------------------------
Operating costs 2 (134.3) (108.7) (213.6) Royalties (5.4) (5.3) (11.5) Depreciation, amortisation and depletion (34.4) (25.8) (50.0) ----------------------------------------------------------------------- Total costs (174.1) (139.8) (275.1) ----------------------------------------------------------------------- Operating profit 3 50.3 52.7 112.6 Share of earnings of associated undertakings 1.4 0.6 2.0 --------------------------------------------------------------------- Profit on ordinary activities before interest 51.7 53.3 114.6 Commissions on issue of shares - - (2.0) Deferred loan fees written off (0.4) - (2.8) Interest receivable 4.4 2.8 4.9 Interest payable (8.8) (4.4) (8.5) --------------------------------------------------------------------- Profit on ordinary activities before taxation 46.9 51.7 106.2 Taxation (0.3) (3.0) (0.4) --------------------------------------------------------------------- Profit on ordinary activities after taxation 46.6 48.7 105.8 Minority interest (0.1) (0.6) 0.1 --------------------------------------------------------------------- Profit attributable to shareholders 46.5 48.1 105.9 Dividends 4 (12.0) (10.5) (32.6) --------------------------------------------------------------------- Retained profit for the period 34.5 37.6 73.3 --------------------------------------------------------------------- Earnings per share (US$) 0.53 0.57 1.22 Dividends per share (US$) 0.125 0.125 0.375 --------------------------------------------------------------------- There were no discontinued operations during the period Weighted average number of issued shares (millions) 87.8 83.9 86.9 -0- Consolidated Balance Sheet
As at As at As at
31 March 31 March 30 Sept
1996 1995 1995
US$ million US$ million US$ million
(unaudited) (unaudited)
---------------------------------------------------------------------
Fixed assets Fixed property, plant and equipment 740.4 558.0 638.1 Investments in associated undertakings 5.8 4.7 6.1 ---------------------------------------------------------------------
746.2 562.7 644.2
---------------------------------------------------------------------
Current assets Stocks/inventories 75.8 68.7 81.2 Debtors/receivables 53.1 26.0 27.5 Cash 110.9 53.2 128.3 ---------------------------------------------------------------------
239.8 147.9 237.0
---------------------------------------------------------------------
Creditors: amounts falling due within one year Current portion of long term loans (19.7) (22.4) (2.4) Trade and other creditors/payables (36.8) (31.6) (50.4) Dividends (12.0) (10.5) (22.5) Accruals and deferred income (54.7) (20.4) (21.7) ---------------------------------------------------------------------
(123.2) (84.9) (97.0)
---------------------------------------------------------------------
-0-
Consolidated Cash Flow Statement
6 months 6 months 12 months
to to to
31 March 31 March 30 Sept
1996 1995 1995
US$ million US$ million US$ million
(unaudited) (unaudited)
------------------------------------------------------------------------
Net cash inflow from operating activities 88.4 57.8 145.4 ------------------------------------------------------------------------ Returns on investments and servicing of finance Interest received 3.5 2.8 4.9 Interest paid (9.1) (4.4) (7.1) Interest paid on finance leases (1.6) - - Dividends from associated undertakings 0.2 - 0.3 Dividends paid (19.2) (21.0) (31.1) ------------------------------------------------------------------------ Net cash outflow from returns on investments and servicing of finance (26.2) (22.6) (33.0) ------------------------------------------------------------------------ Taxation Corporate tax paid 0.0 (2.5) (2.5) ------------------------------------------------------------------------ Investing activities Purchase of property, plant and equipment (76.9) (63.1) (176.9) Proceeds from sale of fixed assets 0.2 - 2.5 Net cash outflow on purchase of subsidiary and associated companies (81.8) (1.1) 0.0 -------------------------------------------------------------
1 Turnover
6 months 6 months 12 months
to to to
31 March 31 March 30 Sept
1996 1995 1995
US$ US$ US$
million million million
Bullion revenue 193.2 177.5 357.8
Gain on hedging
transactions 26.4 6.7 26.7
Silver - - 0.3
Non-gold mining
activities
(net of intra group sales) 4.8 8.3 2.9
----------------------------------------------------------------------
224.4 192.5 387.7
----------------------------------------------------------------------
2 Operating costs a) Analysis by business group
6 months 6 months 12 months 12 months
to to to to
31 March 31 March 30 Sept 30 Sept
1996 1996 1995 1995
US$ Cost/ US$ Cost/
million ounce million ounce
Gold mining - cash operating costs 114.8 234 194.2 208 Gold mining - corporate administration 10.5 22 18.0 19 Adjustment 3.2 - - - ----------------------------------------------------------------------- Sub-total 128.5 256 212.2 227 Exploration expenses written off 3.6 - - - Non-gold mining activities 2.2 - 4.2 - Environmental provision - - (2.8) - ----------------------------------------------------------------------- Total 134.3 256 213.6 227 ----------------------------------------------------------------------- The adjustments of US$3.2 million comprise: 1) An adjustment in respect of an overstatement of foreign exchange gains recorded in 1994/95 and 2) Write offs in respect of insurance claims which had been credited to the 1994/95 Group Profit and Loss account. b) Analysis by ore source
Underground Tailings Surface Cluff Total
Ounces
180,533 36,331 234,394 38,880 490,138
Weighted
Cost breakdown Average
(US$ per ounce)
Mining 129 - 128 108 117
Treatment 72 87 106 62 91
Production
overheads 24 24 24 54 26
-----------------------------------------------------------------------
Total cash
operating costs 225 111 258 224 234
-----------------------------------------------------------------------
3 Operating profit analysis by business area
Obuasi Cluff AEL Corp Non Total
admin gold
Production ozs 451,258 38,880 - - - 490,138
-----------------------------------------------------------------------
Revenue US$m - spot 177.8 15.4 - - - 193.2
Revenue US$m - hedging 26.4 - - - - 26.4
Revenue US$m - other - - - - 4.8 4.8
-----------------------------------------------------------------------
204.2 15.4 - - 4.8 224.4
Costs 109.3 8.7 3.6 10.5 2.2 134.3
Royalties 5.2 0.2 - - - 5.4
Depreciation 30.4 3.0 - - 1.0 34.4
-----------------------------------------------------------------------
Operating profit March 1996 59.3 3.5 (3.6) (10.5) 1.6 50.3 Operating profit March 1995 59.1 - - (7.9) 1.5 52.7 ----------------------------------------------------------------------- 4 Dividend The interim dividend for 1996 is based on the anticipated number of ordinary shares which will be in issue on the record date of 28 August 1996 following the completion of acquisitions currently taking place with the exception of GSM, whose shareholders will not be eligible for this dividend. 5 Commitments and gold hedging
As at 31 March 1996, Ashanti had entered into forward sale contracts
covering 4.1 million ounces at an average price of US$432 per ounce,
of which 2.5 million ounces were spot deferred sales at an average
price of US$439 per ounce. Contracts totalling 761,500 ounces are
scheduled for delivery in the year ending 31 December 1996 at an
average price of US$419 per ounce.
Contracts totalling 950,500 ounces as at the end of March are short
term one-month rolling spot deferred contracts which are intended to
be scheduled for delivery in the years 1999 to 2001, once the gold
forward rate improves. The Company currently receives the benefit of
high short term contango. As of 24 May 1996, 298,000 ounces of these
contracts had been scheduled over the years 1991 to 2001 at an
average price of US$473 per ounce.
As a measure of protection against downward movement in the gold
price, Ashanti had at 31 March 1996, purchased put options enabling
the Company to sell 160,000 ounces at a minimum price of US$433 per
ounce. In addition, the Company had sold call option contracts for
1.1 million ounces at an average strike price of US$459 per ounce.
These call option quantities are within the limit of 20% of projected
annual production from 1997 to 1999 and 25% of projected annual
production from the years 2000 to 2003.
The total volume covered by forward sales and put and call options
was 5.4 million ounces.
This represents about 25% of Ashanti's reserve position of over 22
million ounces, leaving the Company with substantial unhedged gold
reserves.
-0-
In total, the Group's commitments for future sales of bullion arising from its hedging transactions mature as follows:
1997- Total/
1996 2005 Weighted
Average
Spot deferreds:
Amount hedged (000's ounces) 722 1,782 2,503
Average price (US$/ounce) 419 448 439
Short term spot deferred:
Amount hedged (000's ounces) 950 - 950
Average price (US$/ounce) 403 - 403
Fixed forwards:
Amount hedged (000's ounces) 40 590 630
Average price (US$/ounce) 424 452 450
Sub total 1,712 2,372 4,083
Put options purchased:
Amount hedged (000's ounces) 40 120 160
Average price (US$/ounce) 433 433 433
Call options written:
Amount hedged (000's ounces) 70 1,074 1,144
Average price (US$/ounce) 437 460 459
Grand total (000's ounces) 1,712 3,675 5,387
(i) Spot deferred contracts have been classified according to the intended date of maturity. (ii) Options have been allocated to the periods in which they expire. (iii) Short term spot deferred contracts roll with one month's maturity and the designated final maturities had not yet been scheduled as at 31 March 1996. -0- To the members of Ashanti Goldfields Company Limited We have carried out a limited review of the financial information contained in the consolidated profit and loss account for the six months ended 31 March 1996 and the consolidated balance sheet as at that date. Our review consisted principally of obtaining an understanding of the processes involved in preparing the information, applying analytical procedures where appropriate and making enquiries of management responsible for financial and accounting matters. It was substantially less in scope than an audit in accordance with International Accounting Standards, the objective of which is to express an opinion on the truth and fairness of the accounts as a whole, and accordingly we do not express such an opinion. In our opinion, the six months' financial information has been prepared with due care using accounting policies consistent with those adopted by the Company in its accounts for the year ended 30 September 1995 and we are not aware of any material modifications that should be made to the six months' financial information as presented. -0- Deloitte & Touche Pannell Kerr Forster Accra, Ghana Accra, Ghana 11 June 1996 11 June 1996 CONTACT: Press Enquiries: Ashanti Goldfields Company Limited John Grice Sir John Grice (6 October 1850 – 27 February 1935) was an Australian business man and company director. Grice was son of Richard Grice, a Melbourne merchant, was born at Melbourne. , Company Secretary, 233-21-774977 James Anaman, Corporate Affairs Manager, 233-21-778178 Corine Gaisie, Corporate Relations Manager, 171-256-9938 or Shandwick Consultants (London) John Goold, 171-329-0096 or Golin/Harris (New York New York, state, United States New York, Middle Atlantic state of the United States. It is bordered by Vermont, Massachusetts, Connecticut, and the Atlantic Ocean (E), New Jersey and Pennsylvania (S), Lakes Erie and Ontario and the Canadian province of ) Allan Jordan, 212-697-9191 or Continental Communications (Toronto) Allan Reynolds, 416/964-6444 |
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