Anglo American plc notification
27 July, 2007
De Beers Société Anonyme (“DBSA”) today reported underlying earnings for the six months ended 30 June 2007 of US$324 million.
Anglo American plc (“AA plc”) arrives at its underlying earnings in respect of De Beers by accounting for the interests arising from the ordinary shares and the 10% preference shares it holds.
AA plc will therefore report underlying earnings of US$156 million for the six months ended 30 June 2007 from its investment in De Beers, as reconciled in the table below:
| US$ million | 6 months ended 30.6.2007 |
|---|---|
| De Beers underlying earnings (100%) | 324 |
| Difference in IAS 19 accounting policy | 2 |
| De Beers underlying earnings – AA plc basis (100%) | 326 |
| AA plc's 45% ordinary share interest | 147 |
| Income from preference shares | 9 |
| AA plc underlying earnings | 156 |
In the six months ended 30 June 2007, AA plc received a total of US$32 million in distributions from De Beers, consisting of a US$23 million final dividend on ordinary shares relating to FY 2006, and a US$9 million dividend representing the second payment on preference shares for 2006.
Underlying Earnings
Underlying Earnings is net profit attributable to equity shareholders, adjusted for the effect of special items and remeasurements, and any related tax and minority interests. Special items are those items of financial performance which are material by nature or amount and should therefore be separately presented. These principally relate to impairment and significant closure costs, exceptional legal provisions and profit or loss on disposals. Remeasurements include (i) adjustments to ensure that the unrealised gains or losses on non-hedge derivative instruments are recorded in underlying earnings in the same period as the underlying transaction against which these instruments provide an economic, but not formally designated, hedge and (ii) foreign currency gains and losses arising on the retranslation of dollar denominated De Beers preference shares held by a rand functional currency subsidiary of the Group.
The above figures are unaudited.