Driving change, defining our future

While the mining industry continues to face considerable external pressures, we have responded decisively to materially strengthen our balance sheet. We will redefine our portfolio by focusing on diamonds, platinum group metals and copper.

Focus the portfolio

DRIVING CHANGE

$2.1
billion
Disposal transactions completed or announced in 2015.

In light of the commodity price environment, we have ceased, or are ceasing, production at a number of operations.

We have agreed the sale of Platinum’s Rustenburg operations and sold Copper’s Norte assets.

Focus the portfolio

DEFINING OUR FUTURE

We are focusing on De Beers, PGMs and Copper, and our disposals target for non-core assets in 2016 is $3-4 billion.

We are moving to a materially streamlined core portfolio of 16 assets, including Mogalakwena, Platinum’s top-priority asset and the world’s biggest open pit platinum mine.

In 2015, Mogalakwena commanded the highest rand basket price in Platinum’s portfolio at ZAR32,850 per platinum ounce. It also generated significant operating free cash flow, while keeping cash operating margins at 50%, despite weaker prices.

Focus on delivery

DRIVING CHANGE

$1.3
billion
of cost and productivity improvements in 2015.

There has been a 27% reduction in copper equivalent unit costs in US dollar terms since 2012. There has been a 33% capex reduction in 2015, to $4.0 billion. The dividend has been suspended and will resume with a payout ratio-based policy when appropriate.

Focus on delivery

DEFINING OUR FUTURE

Net debt is expected to be less than $10 billion by the end of 2016. Capex is expected to be less than $3.0 billion.

$1.9 billion of cost and productivity improvements is expected in 2016. At Los Bronces, a world class copper asset in Chile, we continue to roll out our Operating Model. Improvements through implementation of the Operating Model are expected to yield an additional 15,000 tonnes of copper a year by 2017, with an 11% lower processing cost per tonne.

Develop core business processes

DRIVING CHANGE

$100
million
avoided energy costs in 2015 driven by eco2man and business improvement projects.

Underlying EBIT improvement of around $400 million has been achieved since 2013 from marketing activities. In 2015, 78% of Los Bronces’ water requirement was met by re-used/recycled water.

Develop core business processes

DEFINING OUR FUTURE

9 multi-horizon initiatives to come out of our Open Forum events focused on finding safer, more efficient, environmentally friendly and sustainable ways to unlock mineral value.

Our focus is on securing adequate supplies of energy and water and using those resources more efficiently. In the long term, however, we must find viable alternatives for traditional sources of energy and reduce our reliance on ‘new’ water to near zero.

By focusing on understanding the needs of customers and leveraging Anglo American’s industry-leading position, our Marketing business unlocked value across our range of PGMs in 2015.

Create a high performance culture

DRIVING CHANGE

25% Female managers across the group.

A diverse workforce brings greater diversity of thought to tackle the challenges we face. We continually develop our workforce so that we will have this diversity among our leaders of the future. By year end, women made up 18% of our overall workforce (2014: 16%) and 25% of managers (2014: 24%).

Create a high performance culture

DEFINING OUR FUTURE

50,000 Headcount reduction from 128,000 to 50,000 as the portfolio restructure is completed.

We expect that the future rightsizing of our corporate support structures will lead to a reduction of indirect roles from the current 11,500 to less than 5,000. The changes to central support costs alone are expected to contribute $250 million of cost savings in the medium term.

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Real Mining. Real People. Real Difference.