AngloGold Ashanti's CEO Discusses Q4 2011 Results - Earnings Call Transcript

AngloGold Ashanti (AU)

Q4 2011 Earnings Call

February 15, 2012 9:00 am ET

Executives

Stewart Bailey -

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Mark Cutifani - Chief Executive Officer, Executive Director, Chairman of Executive Committee, Member of Safety, Health & Sustainable Development Committee, Member of Investment Committee, Member of Risk & Information Integrity Committee, Member of Party Political Donations Committee and Member of Transformation & Human Resources Development Committee

Srinivasan Venkatakrishnan - Chief Financial Officer and Member of Finance Committee

Analysts

Sabrina Grandchamps - HSBC, Research Division

Presentation

Operator

Good day, and welcome to the AngloGold Ashanti Q4 2011 Results Conference Call. [Operator Instructions] Please also note that this conference is being recorded. I would now like to turn the conference over to Mr. Stewart Bailey. Please go ahead, sir.

Stewart Bailey

Thanks, Dylan. And everybody, good morning and welcome to the presentation by AngloGold Ashanti's Executive Team of our results for the quarter ended -- quarter and full year ended 31st of December 2011.

The presentation format will be as usual: Mark Cutifani will review the company's performance over the quarter, Venkat will then contextualize the financials and Mark will conclude by highlighting key projects and exploration progress before taking your questions.

We do have members of our executive team present, and we're also joined by Frank Arisman, a nonexecutive director on the board.

As usual, well read the Safe Harbor statement. Certain statements made in this communication, including, without limitation, those concerning the economic outlook for the gold mining industry, expectations regarding gold prices, production, cash costs and other operating results, growth prospects and outlook of AngloGold Ashanti's operations, individually or in the aggregate, including the completion and commencement of commercial operations of certain of AngloGold Ashanti's exploration and production targets and the completion of announced mergers and acquisition transactions, AngloGold Ashanti's liquidity, capital resources and capital expenditure and the outcome and consequences of any litigation or regulatory proceedings or environmental issues, contain certain forward-looking statements regarding AngloGold Ashanti's operations, economic performance and financial condition.

Although AngloGold Ashanti believes that the expectations reflected in such forward-looking statements are reasonable, no assurance can be given that such expectations will prove to have been correct. Accordingly, results could differ materially from those set out in the forward-looking statements as a result of, among other factors, changes in the economic and market conditions, success of business and operating initiatives, changes in the regulatory environment and other government actions, including environmental approval and actions, fluctuations in gold prices and exchange rates and business and operational risk management.

[Audio Gap]

of certain of these and other factors, refer to AngloGold Ashanti's annual report for the year ended 31st of December 2010, which was distributed to shareholders on 29 March 2011, and the company's 2010 annual report on Form 20-F, filed with the SEC in the U.S. on May 31, 2011.

These factors are not necessarily all of the important factors that could cause AngloGold Ashanti's actual results to differ materially from those expressed in any forward-looking statements. Other unknown or unpredictable factors could also have material adverse effects on future results. AngloGold Ashanti undertakes no obligation to update publicly or release any revisions to these forward-looking statements to reflect events or circumstances after today's date or to reflect the occurrence of an unanticipated event.

All subsequent written or oral forward-looking statements attributable to AngloGold Ashanti or any person acting on its behalf are qualified by the cautionary statements herein.

The communications -- this communication contains certain non-GAAP financial measures. AngloGold Ashanti uses certain non-GAAP financial measures and ratios in managing its business.

Non-GAAP financial measures should be viewed in addition to and not as an alternative for the reported operating results or cash flow from operations or any other measures of performance prepared in accordance with IFRS. In addition, the presentation of these measures may not be comparable to similarly titled measures other companies may use.

AngloGold Ashanti posts information important to investors on the main page of its website, www.anglogoldashanti.com, and under the investors tab on the main page. This information is updated regularly. Investors should visit the website to obtain important information about AngloGold Ashanti. And with that, I'll hand over to Mark Cutifani. Mark?

Mark Cutifani

Thanks very much, Stewart. Ladies and gentlemen, I will start with a couple of comments on the gold price. Certainly, since the pullback in the gold price late last year, we've certainly had a much more positive start to 2012 with the price up a healthy 10% since the beginning of January. We believe the fundamentals for a strong gold price remain intact. Inflation across many of the key emerging markets is a reality. The euro crisis continues to rage across the continent, and the Fed has created certainly near-0 interest rates for the foreseeable future.

The long-term resolution to the expanded U.S. balance sheet, however, is a little less obvious. And while demand remains robust from investors and consumers alike, the industry is finding it tough as ever to respond to record price levels, notwithstanding AngloGold Ashanti's very prominent pipeline or great pipeline that will kick in over the next 2 years.

Consistent with gold's revitalized value proposition in our uncertain world, we believe the AngloGold story is one of a revitalized business, leveraging value for shareholders over both the short and the long-term by -- and through 3 key areas: firstly, growing the size and quality of our resource base; second, improving margins and returns on investment; and third, by providing a clear pathway to value growth for shareholders both in terms of capital and cash flow appreciation direct to our shareholders.

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