AngloGold Cuts Jobs, Restructures Top Team After Profit Falls

(Bloomberg) -- AngloGold Ashanti Ltd. trimmed jobs and is reviewing its assets after full-year profits declined amid rising costs and the temporary halt of operations at a key African mine.  

The Johannesburg-based company cut 215 support roles across its global business as part of a cost-saving reorganization, it said in a statement. It has also begun a full review of the potential of all of its assets. Net income slumped 35% to $622 million because of an accident last year at the Obuasi mine in Ghana and higher costs partly linked to the restructuring, it said. 

Chief Executive Officer Alberto Calderon is also re-jigging top management, with the aim of turning the company around within two years.   

“With the full asset potential, we should start seeing results in 2024,” he said in an interview. That’s “pretty quick for a mining company.” 

AngloGold lagged peers in the past year after the halt to output at Obuasi, where it had been ramping up production following $545 million of investment. The gold miner’s review won’t result in any “major reshuffling” of assets, though the company may decide there are some worth selling, Calderon said. “That will be more the exception than the rule,” he added. 

New Hires

AngloGold cut jobs across all of its operations and also announced that Sicelo Ntuli, the chief operations officer for Africa, is leaving the company. It also hired Terry Briggs as chief development officer, the second hire from Newmont Corp, after Marcelo Godoy joined as chief technology officer last year. Chief Financial Officer Christine Ramos, who previously led the company during its search for a permanent CEO, is retiring.

The changes would blend “a mixture of very seasoned experienced gold people with the seasoned operators we have here” and may help the company close the valuation gap it has with peers, Calderon said.

AngloGold’s output fell 12% to about 2.47 million ounces, while expenses surged 31% to $1,355 an ounce. The miner is forecasting output of 2.55 million to 2.8 million ounces of gold this year as Obuasi gradually ramps up. AngloGold declared a final dividend of 14 cents a share, raising the full-year payout to 20 cents.

What Bloomberg Intelligence Says:

“AngloGold hitting its 2022 all-in sustaining cash cost guidance of $1,295-$1,425 an ounce of gold would mark an early win for CEO Alberto Calderon’s new business strategy and senior leadership. The senior gold miner is one of a few to anticipate flat unit cash costs vs. 2021 despite inflationary pressure. This reflects the company’s turnaround potential, but also mirrors its slack 2021 operating performance.”

--Grant Sporre and Emmanuel Munjeri, BI metals analysts

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