Annual Results 2010
18 February, 2011
Anglo American announces EBITDA of $12.0 billion and doubles operating profit to $9.8 billion
Financial results driven by strong operational performance and higher prices
- Group operating profit(1) of $9.8 billion ($9.1 billion from core operations(2))
- Underlying earnings(3) of $5.0 billion and underlying earnings per share of $4.13, a 93% increase
- Profit attributable to equity shareholders of $6.5 billion
- Net debt(4) reduced to $7.4 billion at 31 December 2010
Operational excellence and strategic delivery
- $3.0 billion ($2.5 billion from core operations) benefit delivered from asset optimisation and procurement programmes, exceeding target of $2 billion(5) by the end of 2011:
- Asset optimisation: $1.8 billion (from core operations), including one-off benefits
- Procurement: $0.7 billion (from core operations)
- Strong productivity performances:
- Kumba mining productivity up 11%
- Metallurgical Coal export mine productivity up 48% since 2008
- Platinum business transformed – cash operating costs controlled below inflation, labour productivity increased by 23% since 2008 and production target exceeded at 2.6 million ounces
- $3.3 billion of announced proceeds(6) from divestments of non-core businesses, including:
- $1.3 billion from sale of zinc business
- $0.9 billion from sale of Moly-Cop and AltaSteel
- Tarmac and Lafarge to combine UK businesses to create a leading UK construction materials company
Near-term volume growth of 50% (7) by 2015 driven by several major projects
- Barro Alto 36 ktpa nickel project – first production in March 2011, on schedule
- Los Bronces 200 ktpa copper expansion on schedule for first production in Q4 2011
- Kolomela 9 Mtpa iron ore project 81% complete, on schedule for first production by end Q2 2012
- Minas-Rio 26.5 Mtpa iron ore project – significant progress made, with major licences awarded and long-term port tariff agreement secured
$70 billion project pipeline with potential to double production (7) over next decade
- Two major new projects to be approved: Quellaveco (225 ktpa copper) and
Grosvenor (4.3 Mtpa metallurgical coal) - Expect to approve $16 billion of projects over next 3 years
Safety performance
- Number of fatalities reduced by 68% since early 2007
- Lost time injury rates reduced by 51% since early 2007
- Drive for zero harm stepped up
Dividend
- Final dividend of $0.40 per share, bringing total dividends for the year to $0.65 per share
| HIGHLIGHTS US$ million, unless otherwise stated |
Year ended 31 Dec 2010 |
Year ended 31 Dec 2009 |
Change |
|---|---|---|---|
| Group revenue including associates(8) | 32,929 | 24,637 | 34% |
| Operating profit including associates before special items and remeasurements – core operations(1)(2) | 9,102 | 4,451 | 104% |
| Operating profit including associates before special items and remeasurements(1) | 9,763 | 4,957 | 97% |
| Underlying earnings(3) | 4,976 | 2,569 | 94% |
| EBITDA(9) | 11,983 | 6,930 | 73% |
| Net cash inflows from operating activities | 7,727 | 4,087 | 89% |
| Profit before tax(10) | 10,928 | 4,029 | 171% |
| Profit for the financial year attributable to equity shareholders(10) | 6,544 | 2,425 | 170% |
| Earnings per share (US$): | |||
| Basic earnings per share (10) | 5.43 | 2.02 | 169% |
| Underlying earnings per share(3) | 4.13 | 2.14 | 93% |
(1) Operating profit includes attributable share of associates’ operating profit (before attributable share of associates’ interest, tax and non-controlling interests) and is before special items and remeasurements, unless otherwise stated, see notes 3 and 4 to the Condensed financial statements. For the definition of special items and remeasurements see note 5 to the Condensed financial statements.
(2) Operations considered core to the Group are Platinum, Diamonds, Copper, Nickel, Iron Ore and Manganese (Kumba Iron Ore, Iron Ore Brazil and Samancor), Metallurgical Coal, Thermal Coal, Exploration and Corporate Activities. See page 11 in the Financial review of Group results section for a reconciliation of operating profit from core operations to Group operating profit.
(3) See note 10 to the Condensed financial statements for basis of calculation of underlying earnings.
(4) Net debt includes related hedges and net debt in disposals groups. In 2010 net debt has been updated to include related hedges, being derivative instruments that provide an economic hedge of assets and liabilities included in net debt. The comparative has been adjusted accordingly. See note 13 to the Condensed financial statements.
(5) $1bn of sustainable AO benefits from core businesses and $1bn of procurement benefits from core businesses.
(6) Consideration on a debt and cash free basis, as announced.
(7) 2009 production base line for production growth information.
(8) Includes the Group’s attributable share of associates’ revenue of $4,969 million (2009: $3,779 million). See note 3 to the Condensed financial statements.
(9) Earnings before interest, tax, depreciation and amortisation (EBITDA) is operating profit before special items, remeasurements, depreciation and amortisation in subsidiaries and joint ventures and includes attributable share of EBITDA of associates. See note 6 to the Condensed financial statements.
(10) Stated after special items and remeasurements.