AngloGold Ashanti, which yesterday reported a 3% September 2023 quarter on quarter increase in gold production, will pay R4.5 billion in South African taxes after it moved its head office and primary listing from South Africa to the US.
The gold mining giant completed its head-office restructuring and migration from the JSE in September. It, however, said yesterday that it “remains committed to the Johannesburg Stock Exchange (JSE) and A2X Markets (A2X) in South Africa (SA) and the Ghana Stock Exchange (GhSE) in Ghana, on each of which it has maintained secondary” listings.
However, the shift from SA to the US has attracted hefty tax payments in SA and in Australia. The total sum of these tax payments amounted to $286 million.
In South Africa, AngloGold Ashanti will pay dividend withholding tax of about R4.18bn, in addition to a securities transfer tax of R351 million.
These tax amounts were calculated based on market prices on 22 September 2023 at a closing share price of $18.15, shares in issue of 419 685792 and the company’s market capitalisation on the NYSE of $7.6 billion (R144bn).
This came as AngloGold Ashanti has been actively seeking to enhance cost-efficiency and extend the life of its mines. Migration of its primary listing to the NYSE is geared to enhance access to the world's largest capital market and improved positioning alongside the gold industry's most highly valued companies, it said.
In the quarter period to end September 2023, AngloGold Ashanti recorded a 3% increase in gold production to 673 000 ounces compared to the previous June quarter. This has been attributed to “higher ore tonnes processed partly offset by lower” grades.
However, production for the nine month period to September 2023 at 1.909 million ounces is lower compared to the 1.971 million ounces produced in the same period last year, attributable to production challenges at the Siguiri mine in Guinea where about 29 000 ounces of gold were lost. The suspension of waste deposition at the Cuiabá mine in Brazil also resulted in the loss of about 5 000 ounces of gold after occasioning a transition to gold-in-concentrate production.
“Gold production has improved in the third quarter of 2023 and is expected to step up again over the remainder of the year, in line with our guidance,” AngloGold Ashanti CEO Alberto Calderon said.
He added that the company was working to enhance its competitiveness against its peers, with increased focus on decarbonisation of operations.
Progress with the decarbonisation programme has been registered at the Geita site, in Tanzania, as well as at the Tropicana site in Western Australia. AngloGold Ashanti was now preparing to connect the mine site to the Tanzania grid, “which has a high percentage of its power mix from renewable” energy sources. At Tropicana, project works have commenced for the construction of a 62MW wind and solar facility.
Calderon said during an online results briefing that the company was sticking to its production guidance for the full year outlook.
The company has previously said that it is targeting production of at least 2.4 million ounces of gold this year. Production is now set to be weighted in the second half, with fourth quarter production “expected to be the strongest out of all the quarters” this year.
“We are holding to the guidance we issued in February. All guidances. This will require another step up in up production in fourth quarter,” he said.
Gold production is expected to be second half weighted, with fourth quarter gold production expected to be the strongest out of all the quarters this year.
In terms of capital projects, phase 3 of the Obuasi Redevelopment Project, relating mainly to dewatering and refurbishing existing infrastructure to improve overall mining flexibility and access to the higher-grade Block 11 area in future years, reached 82% overall completion during the period under review.
AngloGold Ashanti has also received a cash payment of $20m after agreeing to sell its 50% indirect interest in the Gramalote Project to B2Gold Corp for a total consideration of up to $60m. The transaction closed on 29 September 2023, and payment of the balance is dependent on project construction and production milestones.