AngloGold Posts Q3 Adjusted EBITDA Of $400 Mln; Beats Q3 Forecast

(RTTNews) - AngloGold Ashanti's (AU) costs and production for the third quarter beat guidance, helping the firm to generate free cash flow and reduce debt as fundamental operating and safety improvements continued to gain traction across the business. Also, the company narrowed its production outlook for the year to the top end of the initial guidance range and lowered its capital expenditure forecast.

Production was 1.128Moz at a total cash cost of $820/oz for the quarter to September 30, compared to 1.043Moz at a total cash cost of $809/oz in the corresponding period of last year. Guidance for the quarter was for 1.06Moz - 1.09Moz at $850/oz - $890/oz.

The strong performance in the first nine months of 2014 helped AngloGold Ashanti tighten the production outlook for 2014 to 4.35Moz-$4.45Moz, at the top end of initial of guidance 4.2Moz - 4.5Moz. This improvement comes despite the sale of the Navachab mine in Namibia in May, losses caused by the earthquake in South Africa, and the transition of the Obuasi Mine to limited operating state by the year-end.

Forecast capital expenditure, initially set at $1.35 billion - $1.45 billion, has been lowered to $1.25 billion - $1.35 billion, due to savings at the loss-making Obuasi mine. The forecast for all-in sustaining costs has been kept at $1,025/oz - $1,075/oz.

Adjusted Earnings Before Interest Depreciation and Amortisation or EBITDA increased to $400 million from $327 million in the third quarter of 2013, reflecting an improvement in the adjusted EBITDA margin from 24% a year ago, to the current 31%.