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2019 Interim Results

25 July, 2019

Sustained business performance delivers 19% increase in underlying EBITDA to $5.5 billion

Mark Cutifani, Chief Executive of Anglo American, said: “We are building on the improvements we have embedded across our business and benefiting from our diversification as stronger prices for certain products more than offset price weaknesses elsewhere, generating a 19% increase in underlying EBITDA to $5.5 billion and a 22% ROCE. The strength of our balance sheet and disciplined capital allocation support our investment in highly attractive organic growth while delivering a 27% dividend increase, in line with our 40% payout ratio, and our intention to return up to $1 billion through a share buyback.

“Our determination to reach and sustain zero harm is our most pressing challenge. No degree of financial performance is worth a life, however, and in the first six months of 2019, regrettably three of our colleagues died in workplace safety incidents, two of which were vehicle related. Two additional fatal transport incidents in Chile in late June and early July caused the loss of ten of our colleagues and are being urgently investigated. The safety of our people ‒ at work or travelling to and from home ‒ is paramount and we have instructed additional wide ranging measures, including with all those who provide transport services to us.

“Our focus on efficiency and productivity, driven by our Operating Model implementation, is continuing to deliver improvements. Compared to 2012, our productivity(1) per employee more than doubled, driving a 16 point increase in Mining EBITDA margin(2) to 46% and placing us amongst the very best in the industry. We expect our targeted cost and volume benefit for 2019 ‒ adjusted to $0.4 billion to reflect our decision to pull back production at De Beers ‒ to come through in the second half of the year, building upon the $4.6 billion of annual underlying EBITDA improvement delivered since 2012. And looking ahead, we are committed to delivering the additional $3-4 billion annual underlying EBITDA run-rate improvement by 2022, relative to 2017.

“Anglo American is a resilient and highly competitive business with a clear asset-led strategy. Our focus is on unlocking the very significant additional potential that we see within the business ‒ and to do it safely and responsibly. Our world class portfolio benefits from a range of high margin, high return, fast payback organic growth options, sequenced over time, particularly in those products that will supply a cleaner, more electrified world and that satisfy the consumer led demands of a fast-growing global middle class.”

Financial highlights – six months ended 30 June 2019

  • Generated underlying EBITDA* of $5.5 billion, a 19% increase, and $1.3 billion of attributable free cash flow*
  • Delivered profit attributable to equity shareholders of $1.9 billion, a 46% increase
  • Net debt* increased to $3.4 billion following adoption of IFRS 16. Net debt of 0.3x underlying EBITDA
  • Targeting full year 2019 cost and volume improvements of $0.4 billion ‒ adjusted for De Beers production
  • Increased interim dividend of $0.62 per share, equal to 40% of first half underlying earnings*
  • Share buyback ‒ intention to return up to $1 billion
Six months ended
US$ million, unless otherwise stated
30 June 2019 30 June 2018 Change
Revenue 14,772 13,698 8%
Underlying EBITDA* 5,451 4,577 19%
Mining EBITDA margin* 46% 41%  
Attributable free cash flow* 1,325 1,606 (17)%
Profit attributable to equity shareholders of the Company 1,883 1,290 46%
Underlying earnings per share* ($) 1.58 1.23 28%
Earnings per share ($) 1.48 1.02 45%
Dividend per share ($) 0.62 0.49 27%
Group attributable ROCE* 22% 19%  

(1) Productivity indexed to 2012 benchmark.
(2) The Mining EBITDA margin is derived from the Group’s Underlying EBITDA as a percentage of Group Revenue, adjusted to exclude certain items to better reflect the performance of the Group’s mining business. The Mining EBITDA margin reflects Debswana accounting treatment as a 50/50 joint operation, excludes third-party sales, purchases and trading and excludes Platinum Group Metals' purchase of concentrate.

Terms with this symbol * are defined as Alternative Performance Measures (APMs). For more information on the APMs used by the Group, including definitions, please refer to page 61.

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 Robert Greenberg
Email: [email protected] Email: [email protected]
Tel: +44 (0)20 7968 8891 Tel: +44 (0)20 7968 2124
South Africa Emma Waterworth
Pranill Ramchander Email: [email protected]
Email: [email protected] Tel: +44 (0)20 7968 8574
Tel: +27 (0)11 638 2592  
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 mining operations and undeveloped resources provides the metals and minerals that enable a cleaner, more electrified world and that meet the fast growing consumer-driven demands of the world’s developed and maturing economies. With our people at the heart of our business, we use innovative practices and the latest technologies to discover new resources and mine, process, move and market our products to our customers around the world – safely, responsibly and sustainably.

As a responsible miner – of diamonds (through De Beers), copper, platinum group metals, iron ore, coal and nickel – we are the custodians of what are precious natural resources. We work together with our business partners and diverse stakeholders to unlock the sustainable value that those resources represent for our shareholders, the communities and countries in which we operate, and for society as a whole. Anglo American is re-imagining mining to improve people’s lives.

www.angloamerican.com

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