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Q2 2021 Production Report

20 July, 2021

Anglo American plc Production Report for the second quarter ended 30 June 2021.

Mark Cutifani, Chief Executive of Anglo American, said: “We have delivered a solid operational performance supported by comprehensive Covid-19 measures to help safeguard the lives and livelihoods of our workforce and host communities. We have generally maintained operating levels at approximately 95%(1) of normal capacity and, as a consequence, production increased by 20%⁽²⁾ compared to Q2 of last year, with planned higher rough diamond production at De Beers, as well as strong plant performance at our Los Bronces copper operation in Chile and higher throughput at our Mogalakwena platinum group metals mine in South Africa.
"We also successfully completed the demerger of our thermal coal operations in South Africa and announced the sale of our minority interest in Cerrejón in Colombia, marking the last stage of our transition from thermal coal operations, ahead of schedule. Our portfolio and growth investments are increasingly focused on those future-enabling metals and minerals that are critical to decarbonising energy and transport and to meeting consumers’ growing needs, from luxury to everyday."

Q2 highlights

Completed the demerger of the South Africa thermal coal operations.
Announced the sale of our 33% interest in the Cerrejón thermal coal mine, subject to regulatory approvals.
Rough diamond production increased by 134%, reflecting planned higher production in response to the ongoing consumer demand recovery.
Platinum Group Metals (PGMs) production increased by 59%, with Mogalakwena production increasing by 11%, reflecting the relatively lower impact of Covid-19 lockdowns compared to Q2 2020. Strong refined output reflected stable performance from the ACP Phase A unit.
Iron ore production increased by 6%, driven primarily by Kumba, reflecting the lower impact of Covid-19 lockdowns compared to Q2 2020.
Copper production increased by 2% due to strong plant performance at Los Bronces.
At our longwall metallurgical coal operations, mining restarted at Moranbah at the beginning of June and development work at Grosvenor continues to progress, with restart expected towards the end of the year.

Production	Q2 2021	Q2 2020	% vs. Q2 2020	H1 2021	H1 2020	% vs. H1 2020
Diamonds (Mct)⁽³⁾	8.2	3.5	134%	15.4	11.3	37%
Copper (kt)⁽⁴⁾	170	167	2%	330	314	5%
Platinum group metals (koz)⁽⁵⁾	1,058	665	59%	2,079	1,620	28%
Iron ore (Mt)⁽⁶⁾	15.7	14.8	6%	31.9	30.8	3%
Metallurgical coal (Mt)	3.0	4.0	(25)%	6.2	7.8	(20)%
Nickel (kt)⁽⁷⁾	10.6	10.8	(2)%	20.7	21.7	(5)%
Manganese ore (kt)	941	796	18%	1,845	1,639	13%
Thermal coal (Mt)⁽⁸⁾	4.3	4.4	(1)%	9.3	10.5	(12)%

^{(1) Production capacity excludes Moranbah and Grosvenor.}
^{(2) Copper equivalent production is normalised to reflect the demerger of the South Africa thermal coal operations and the closure of the manganese alloy operations and excludes the impact of the Grosvenor suspension and announced sale of Cerrejón. Including the impact of Grosvenor and Cerrejón, copper equivalent production increased by 20% compared to Q2 2020.}
^{(3) De Beers Group production is on a 100% basis, except for the Gahcho Kué joint venture which is on an attributable 51% basis.}
^{(4) Contained metal basis. Reflects copper production from the Copper business unit only (excludes copper production from the Platinum Group Metals business unit).}
^{(5) Produced ounces of metal in concentrate. 5E+Au (platinum, palladium, rhodium, ruthenium and iridium plus gold). Reflects own mine production and purchase of concentrate.}
^{(6) Wet basis.}
^{(7) Reflects nickel production from the Nickel business unit only (excludes nickel production from the Platinum Group Metals business unit).}
^{(8) Reflects export primary production, secondary production sold into export markets and production sold domestically at export parity pricing from South Africa until the demerger of the South Africa thermal coal operations effective on 4 June 2021, and attributable export production (33.3%) from Colombia (Cerrejón).}

PRODUCTION OUTLOOK SUMMARY

2021 production guidance is summarised as follows:

	2021 production guidance⁽¹⁾
Diamonds⁽²⁾	32-33 Mct (previously 32-34 Mct)
Copper⁽³⁾	650-680 kt (previously 640-680 kt)
Platinum Group Metals⁽⁴⁾	4.2-4.4 Moz (previously 4.2-4.6 Moz)
Iron ore⁽⁵⁾	64.5-66.5 Mt (previously 64.5-67.5 Mt)
Metallurgical coal⁽⁶⁾	14-16 Mt
Nickel⁽⁷⁾	42-44 kt

^{(1) Subject to the extent of further Covid-19 related disruption.}
^{(2) Subject to trading conditions and on a 100% basis except for the Gahcho Kué joint venture, which is on an attributable 51% basis.}
^{(3) Copper business unit only. On a contained-metal basis.}
^{(4) 5E + gold produced metal in concentrate ounces. Includes own mined production (~65%) and purchased concentrate volumes (~35%). The split of metals differs for own mined and purchased concentrate, refer to FY2019 results presentation slide 30 for indicative split of own mined volumes. FY2021 metal in concentrate production is expected to be 1.9-2.0 million ounces of platinum, 1.35-1.40 million ounces of palladium and 0.95-1.0 million ounces of other PGMs and gold.}
^{(5) Wet basis.}
^{(6) Excludes thermal coal production in Australia.}
^{(7) Nickel business unit only.}

REALISED PRICES

	H1 2021	H1 2020	H1 2021 vs H1 2020
De Beers
Consolidated average realised price ($/ct)⁽¹⁾	135	119	13%
Average price index⁽²⁾	109	109	0%
Copper (USc/lb)⁽³⁾	460	250	84%
Platinum Group Metals
Platinum (US$/oz)	1,170	857	37%
Palladium (US$/oz)	2,641	2,141	23%
Rhodium (US$/oz)	24,377	8,985	171%
Basket price (US$/PGM oz)⁽⁴⁾	2,884	1,956	47%
Iron Ore – FOB prices⁽⁵⁾	210	90	133%
Kumba Export (US$/wmt)⁽⁶⁾	216	91	137%
Minas-Rio (US$/wmt)⁽⁷⁾	200	88	127%
Metallurgical Coal
HCC (US$/t)⁽⁸⁾	117	123	(5)%
PCI (US$/t)⁽⁸⁾	103	98	5%
Nickel (USc/lb)	721	502	44%
Thermal Coal
Australia (US$/t)⁽⁸⁾	87	58	50%
South Africa - Export (US$/t)⁽⁹⁾	77	61	26%
Colombia (US$/t)	65	46	41%

^{(1) Consolidated average realised price based on 100% selling value post-aggregation.}
^{(2) Average of the De Beers price index for the Sights within the 6-month period. The De Beers price index is relative to 100 as at December 2006. While the average H1 price index remained broadly flat year-on-year, the closing index increased by 14% compared to the start of 2021.}
^{(3) The realised price for Copper excludes third party sales volumes.}
^{(4) Price for a basket of goods per PGM oz. The dollar basket price is the net sales revenue from all metals (PGMs, base metals and other metals), excluding trading, per 5E + gold sold ounces (own mined and purchased concentrate).}
^{(5) Average realised total iron ore price is a weighted average of the Kumba and Minas-Rio realised prices. The comparative has been restated as Kumba previously reported on a dry basis.}
^{(6) Average realised export basket price (FOB Saldanha) (wet basis as product is shipped with ~1.6% moisture). The comparative has been restated as Kumba previously reported on a dry basis. The realised prices differ to Kumba's standalone results due to sales to other Group companies. Average realised export basket price (FOB Saldanha) on a dry basis is $220/t (H1 2020: $93/t) and this was higher than the dry 62% Fe benchmark price of $166/t (FOB South Africa, adjusted for freight).}
^{(7) Average realised export basket price (FOB Açu) (wet basis as product is shipped with ~9% moisture).}
^{(8) Weighted average coal sales price achieved at managed operations.}
^{(9) Weighted average export thermal coal price achieved until the demerger of the South Africa thermal coal operations effective on 4 June 2021.}

NOTES

This Production Report for the quarter ended 30 June 2021 is unaudited.
Production figures are sometimes more precise than the rounded numbers shown in this Production Report.
Copper equivalent production shows changes in underlying production volume. It is calculated by expressing each product’s volume as revenue, subsequently converting the revenue into copper equivalent units by dividing by the copper price (per tonne). Long-term forecast prices are used, in order that period-on-period comparisons exclude any impact for movements in price.
Please refer to page 18 for information on forward-looking statements.

In this document, references to “Anglo American”, the “Anglo American Group”, the “Group”, “we”, “us”, and “our” are to refer to either Anglo American plc and its subsidiaries and/or those who work for them generally, or where it is not necessary to refer to a particular entity, entities or persons. The use of those generic terms herein is for convenience only, and is in no way indicative of how the Anglo American Group or any entity within it is structured, managed or controlled. Anglo American subsidiaries, and their management, are responsible for their own day-to-day operations, including but not limited to securing and maintaining all relevant licences and permits, operational adaptation and implementation of Group policies, management, training and any applicable local grievance mechanisms. Anglo American produces group-wide policies and procedures to ensure best uniform practices and standardisation across the Anglo American Group but is not responsible for the day to day implementation of such policies. Such policies and procedures constitute prescribed minimum standards only. Group operating subsidiaries are responsible for adapting those policies and procedures to reflect local conditions where appropriate, and for implementation, oversight and monitoring within their specific businesses.

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For further information, please contact:

Media	Investors
UK	UK
James Wyatt-Tilby	Paul Galloway
Email: [email protected]	Email: [email protected]
Tel: +44 (0)20 7968 8759	Tel: +44 (0)20 7968 8718

Marcelo Esquivel	Emma Waterworth
Email: [email protected]	Email: [email protected]
Tel: +44 (0)20 7968 8891	Tel: +44 (0)20 7968 8574

Katie Ryall	Michelle Jarman
Email: [email protected]	Email: [email protected]
Tel: +44 (0)20 7968 8935	Tel: +44 (0)20 7968 1494

South Africa
Nevashnee Naicker
Email: [email protected]
Tel: +27 (0)71 164 5719

Sibusiso Tshabalala
Email: [email protected]
Tel: +27 (0)11 638 2175

Notes to editors:

Anglo American is a leading global mining company and our products are the essential ingredients in almost every aspect of modern life. Our portfolio of world-class competitive operations, with a broad range of future development options, provides many of the future-enabling metals and minerals for a cleaner, greener, more sustainable world and that meet the fast growing every day demands of billions of consumers. With our people at the heart of our business, we use innovative practices and the latest technologies to discover new resources and to mine, process, move and market our products to our customers – safely and sustainably.

As a responsible producer of diamonds (through De Beers), copper, platinum group metals, premium quality iron ore and metallurgical coal for steelmaking, and nickel – with crop nutrients in development – we are committed to being carbon neutral across our operations by 2040. More broadly, our Sustainable Mining Plan commits us to a series of stretching goals to ensure we work towards a healthy environment, creating thriving communities and building trust as a corporate leader. We work together with our business partners and diverse stakeholders to unlock enduring value from precious natural resources for the benefit of the communities and countries in which we operate, for society as a whole, and for our shareholders. Anglo American is re-imagining mining to improve people’s lives.

Forward-looking statements and third-party information:

This announcement includes forward-looking statements. All statements other than statements of historical facts included in this announcement, including, without limitation, those regarding Anglo American’s financial position, business, acquisition and divestment strategy, dividend policy, plans and objectives of management for future operations (including development plans and objectives relating to Anglo American’s products, production forecasts and Ore Reserves and Mineral Resource estimates) and environmental, social and corporate governance goals and aspirations, are forward-looking statements. By their nature, such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Anglo American, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.

Such forward-looking statements are based on numerous assumptions regarding Anglo American’s present and future business strategies and the environment in which Anglo American will operate in the future. Important factors that could cause Anglo American’s actual results, performance or achievements to differ materially from those in the forward-looking statements include, among others, levels of actual production during any period, levels of global demand and commodity market prices, mineral resource exploration and development capabilities, recovery rates and other operational capabilities, safety, health or environmental incidents, the effects of global pandemics and outbreaks of infectious diseases, the outcome of litigation or regulatory proceedings, the availability of mining and processing equipment, the ability to produce and transport products profitably, the availability of transportation infrastructure, the impact of foreign currency exchange rates on market prices and operating costs, the availability of sufficient credit, the effects of inflation, political uncertainty and economic conditions in relevant areas of the world, the actions of competitors, activities by courts, regulators and governmental authorities such as in relation to permitting or forcing closure of mines and ceasing of operations or maintenance of Anglo American's assets and changes in taxation or safety, health, environmental or other types of regulation in the countries where Anglo American operates, conflicts over land and resource ownership rights and such other risk factors identified in Anglo American’s most recent Annual Report. Forward-looking statements should, therefore, be construed in light of such risk factors and undue reliance should not be placed on forward-looking statements.

These forward-looking statements speak only as of the date of this announcement. Anglo American expressly disclaims any obligation or undertaking (except as required by applicable law, the City Code on Takeovers and Mergers, the UK Listing Rules, the Disclosure and Transparency Rules of the Financial Conduct Authority, the Listings Requirements of the securities exchange of the JSE Limited in South Africa, the SIX Swiss Exchange, the Botswana Stock Exchange and the Namibian Stock Exchange and any other applicable regulations) to release publicly any updates or revisions to any forward-looking statement contained herein to reflect any change in Anglo American’s expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. Nothing in this announcement should be interpreted to mean that future earnings per share of Anglo American will necessarily match or exceed its historical published earnings per share.

Certain statistical and other information about Anglo American included in this announcement is sourced from publicly available third-party sources. As such, it has not been independently verified and presents the views of those third parties, though these may not necessarily correspond to the views held by Anglo American and Anglo American expressly disclaims any responsibility for, or liability in respect of, such information.

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