Anglo American plc

07/18/2019 | Press release | Distributed by Public on 07/18/2019 00:14

Anglo American Q2 2019 Production Report

Anglo American plc

Production Report for the second quarter ended 30 June 2019

Mark Cutifani, Chief Executive of Anglo American,said: 'Production is up 2%(1) for the quarter, due to the successful ramp-up at Minas-Rio and strong performance at Metallurgical Coal following the longwall moves and plant upgrade work in Q1. Kumba Iron Ore continues to improve following Q1 production challenges. De Beers, in view of prevailing market conditions, will continue to produce to demand for the year. We remain broadly on track overall to deliver this full year's production targets, with an increase to Minas-Rio guidance offsetting two reductions at De Beers and Kumba Iron Ore.'

Highlights

· De Beers' diamond production decreased by 14% to 7.7 million carats in the quarter, as we continue to produce to market demand and as Venetia transitions from open pit to underground.

· Copper production increased by 1% to 159,100 tonnes due to strong performance at Los Bronces and Collahuasi.

· Platinum production increased by 3%(2) to 520,300 ounces and palladium decreased by 1%(2) to 347,200 ounces, due to a change in mix of production from each operation.

· Kumba's iron ore production decreased by 9% to 10.5 million tonnes due to plant maintenance.

· Minas-Rio's iron ore production was 5.9 million tonnes as its strong ramp-up continues ahead of schedule.

· Metallurgical coal production increased by 11% to 5.8 million tonnes due to generally stronger performance and the completion of Q1 longwall moves.

· Thermal coal production decreased by 8% to 6.6 million tonnes primarily due to local drought conditions at Cerrejón.

Production Summary

Q2 2019

Q2 2018

% vs. Q2 2018

H1 2019

H1 2018

% vs. H1 2018

Diamonds (Mct)(3)

7.7

9.0

(14)%

15.6

17.5

(11)%

Copper (kt)(4)

159

158

1%

320

313

2%

Platinum (koz)(5)

520

508(2)

3%

992

1,006(2)

(1)%

Palladium (koz)(5)

347

350(2)

(1)%

674

699(2)

(4)%

Iron ore - Kumba (Mt)

10.5

11.6

(9)%

20.1

22.4

(11)%

Iron ore - Minas-Rio (Mt)(6)

5.9

0.1

n/a

10.8

3.2

n/a

Metallurgical coal (Mt)

5.8

5.3

11%

10.0

10.8

(7)%

Thermal coal (Mt)(7)

6.6

7.2

(8)%

13.2

14.0

(5)%

Nickel (kt)(8)

9.8

10.8

(9)%

19.6

19.4

1%

Manganese ore (kt)

826

866

(5)%

1,700

1,747

(3)%

(1) Copper equivalent production is normalised to reflect closure of Voorspoed (De Beers) and Sibanye-Stillwater Rustenburg material that has transitioned to a tolling arrangement (Platinum Group Metals). Excluding the impact of Minas-Rio, Group copper equivalent production is down 4% in the quarter.

(2) Normalised for the transition of Sibanye-Stillwater Rustenburg material from purchased concentrate to a tolling arrangement.

(3) De Beers production is on a 100% basis, except for the Gahcho Kué joint venture which is on an attributable 51% basis.

(4) Contained metal basis. Reflects copper production from the Copper business unit only (excludes copper production from the Platinum Group Metals business unit).

(5) Produced ounces of metal in concentrate. Reflects own mine production and purchases.

(6) Wet basis.

(7) Reflects export production from South Africa and attributable export production from Colombia.

(8) Reflects nickel production from the Nickel business unit only (excludes nickel production from the Platinum Group Metals business unit).

DE BEERS

De Beers(1) (000 carats)

Q2

2019

Q2

2018

Q2 2019

vs.

Q2 2018

Q1 2019

Q2 2019 vs.

Q1 2019

H1 2019

H1 2018

H1 2019 vs.

H1 2018

Botswana (Debswana)

5,718

6,279

(9)%

5,950

(4)%

11,668

12,087

(3)%

Namibia (Namdeb Holdings)

335

515

(35)%

483

(31)%

818

1,044

(22)%

South Africa (DBCM)

571

1,018

(44)%

382

49%

953

2,111

(55)%

Canada

1,075

1,185

(9)%

1,037

4%

2,112

2,253

(6)%

Total carats recovered

7,699

8,997

(14)%

7,852

(2)%

15,551

17,495

(11)%

Rough diamond production decreased by 14% to 7.7 million carats driven by reductions in Botswana (Debswana) and South Africa (DBCM). Production guidance has been revised downwards to ~31 million carats, in response to weaker trading conditions.

Botswana (Debswana) production decreased by 9% to 5.7 million carats. This was driven by a decrease at Orapa(2) of 23% to 2.5 million carats following a planned plant shut down brought forward from H2 2019, which impacted production in late Q1 and early Q2. Production at Jwaneng increased by 7% to 3.2 million carats, driven by an increase in tonnes treated.

Namibia (Namdeb Holdings) production decreased by 35% to 0.3 million carats, driven by Elizabeth Bay transitioning onto care and maintenance in Q4 2018 and planned maintenance for the Mafuta crawler vessel.

South Africa (DBCM) production decreased by 44% to 0.6 million carats due to lower mined volumes at Venetia as it approaches the transition from open pit to underground. In addition, Voorspoed production came to an end as it was placed onto care and maintenance in Q4 2018 in preparation for closure.

Canada production decreased by 9% to 1.1 million carats due to planned lower grades at Gahcho Kué. Victor production decreased by 4% to 0.2 million carats as it reached the end of its life during Q2 2019.

Rough diamond sales were 9.0 million carats (8.3 million carats on a consolidated basis)(3) from three sales cycles compared with 10.0 million carats (9.4 million carats on a consolidated basis)(3) from the same number of sales cycles in Q2 2018. Demand for rough diamonds remains subdued as a result of challenges in the midstream with higher polished inventories, and caution due to macro-economic uncertainty, including the US - China trade tensions.

The H1 2019 average realised rough diamond price decreased by 7% to $151/carat (H1 2018: $162/carat), which was driven by a 4% reduction in the average rough price index and a change in the sales mix in response to weaker conditions.

Full Year Guidance

Production guidance(1) is revised to ~31 million carats, the lower end of the previous range (31-33 million carats), in response to weaker trading conditions experienced in the period.

(1) De Beers Group production is on a 100% basis, except for the Gahcho Kué joint venture which is on an attributable 51% basis.

(2) Orapa constitutes the Orapa Regime which includes Orapa, Letlhakane and Damtshaa.

(3) Consolidated sales volumes exclude De Beers Group's JV partners' 50% proportionate share of sales to entities outside De Beers Group from Diamond Trading Company Botswana and the Namibia Diamond Trading Company, which are included in total sales volume (100% basis).

De Beers(1)

Q2

2019

Q1

2019

Q4

2018

Q3

2018

Q2

2018

Q2 2019 vs.

Q1 2019

Q2 2019

vs.

Q2 2018

H1 2019

H1 2018

H1 2019

vs.

H1 2018

Carats recovered (000 carats)

100% basis (unless stated)

Jwaneng

3,223

3,336

2,744

3,143

3,025

(3)%

7%

6,559

6,009

9%

Orapa(2)

2,495

2,614

3,602

2,556

3,254

(5)%

(23)%

5,109

6,078

(16)%

Botswana (Debswana)

5,718

5,950

6,346

5,699

6,279

(4)%

(9)%

11,668

12,087

(3)%

Debmarine Namibia

245

364

400

322

349

(33)%

(30)%

609

714

(15)%

Namdeb (land operations)

90

119

105

138

166

(24)%

(46)%

209

330

(37)%

Namibia (Namdeb Holdings)

335

483

505

460

515

(31)%

(35)%

818

1,044

(22)%

Venetia

571

382

1,141

1,178

922

49%

(38)%

953

1,931

(51)%

Voorspoed

-

-

93

159

96

n/a

(100)%

-

180

(100)%

South Africa (DBCM)

571

382

1,234

1,337

1,018

49%

(44)%

953

2,111

(55)%

Gahcho Kué (51% basis)

883

808

789

927

985

9%

(10)%

1,691

1,822

(7)%

Victor

192

229

254

251

200

(16)%

(4)%

421

431

(2)%

Canada

1,075

1,037

1,043

1,178

1,185

4%

(9)%

2,112

2,253

(6)%

Total carats recovered

7,699

7,852

9,128

8,674

8,997

(2)%

(14)%

15,551

17,495

(11)%

Sales volumes

Total sales volume (100)% (Mct)(3)

9.0

7.5

9.9

5.0

10.0

20%

(10)%

16.5

18.8

(12)%

Consolidated sales volume (Mct)(3)

8.3

7.2

9.3

4.6

9.4

15%

(12)%

15.5

17.8

(13)%

Number of Sights (sales cycles)

3

2

3

2

3

5

5

(1) De Beers Group production is on a 100% basis, except for the Gahcho Kué joint venture which is on an attributable 51% basis.

(2) Orapa constitutes the Orapa Regime which includes Orapa, Letlhakane and Damtshaa.

(3) Consolidated sales volumes exclude De Beers Group's JV partners' 50% proportionate share of sales to entities outside De Beers Group from Diamond Trading Company Botswana and the Namibia Diamond Trading Company, which are included in total sales volume (100% basis).

COPPER

Copper(1) (tonnes)

Q2

2019

Q2

2018

Q2 2019

vs.

Q2 2018

Q1

2019

Q2 2019 vs.

Q1 2019

H1 2019

H1 2018

H1 2019 vs.

H1 2018

Los Bronces

91,200

89,700

2%

91,700

(1)%

182,900

174,700

5%

Collahuasi (44% share)

54,700

54,700

0%

57,300

(5)%

112,000

115,300

(3)%

El Soldado

13,200

13,600

(3)%

12,100

9%

25,300

22,900

10%

Total Copper

159,100

158,000

1%

161,100

(1)%

320,200

312,900

2%

(1) Copper production shown on a contained metal basis. Reflects copper production from the Copper business unit only (excludes copper production from the Platinum Group Metals business unit).

Copper production increased to 159,100 tonnes, reflecting strong performance at both Los Bronces and Collahuasi.

Production from Los Bronces increased by 2% to 91,200 tonnes, driven by planned higher grades (0.81% vs. 0.76%). The operation has experienced a reduction in water availability and storage due to the ongoing drought affecting Chile's central region, with the first half of 2019 being one of the driest autumns ever recorded. While production losses are expected to be largely mitigated for 2019, low precipitation levels over the Chilean winter and spring remain a risk for 2020.

At Collahuasi, attributable production was in line with Q2 2018 at 54,700 tonnes with planned lower grades (1.21% vs. 1.34%) offset by a strong plant performance. The planned three month shut down, to replace a stator motor at the second ball mill on Line 3 (Line 3 has two ball mills and is responsible for 60% of plant throughput), was completed successfully at the end of June.

H1 2019 sales volumes were 307,300 tonnes, at an average realised price of 280c/lb ($6,173/t), in line with the average LME price.

Full Year Guidance

Production guidance is unchanged at 630,000-660,000 tonnes.

Copper(1)

Q2 2019

Q1 2019

Q4 2018

Q3 2018

Q2 2018

Q2 2019

vs.

Q1 2019

Q2 2019

vs.

Q2 2018

H1 2019

H1 2018

H1 2019

vs.

H2 2018

Los Bronces mine(2)

Ore mined

17,302,500

15,678,600

12,675,800

13,019,000

17,837,300

10%

(3)%

32,981,100

33,512,600

(2)%

Ore processed - Sulphide

11,813,600

12,070,800

12,669,900

13,089,300

12,346,700

(2)%

(4)%

23,884,400

24,823,800

(4)%

Ore grade processed -

Sulphide (% TCu)(3)

0.81

0.80

0.81

0.76

0.76

1%

7%

0.81

0.73

11%

Production - Copper cathode

9,300

9,600

10,200

10,300

10,000

(3)%

(7)%

18,900

18,500

2%

Production - Copper in concentrate

81,900

82,100

88,800

85,500

79,700

(0)%

3%

164,000

156,200

5%

Total production

91,200

91,700

99,000

95,800

89,700

(1)%

2%

182,900

174,700

5%

Collahuasi 100% basis

(Anglo American share 44)%

Ore mined

23,698,300

15,642,800

14,781,300

13,791,400

11,454,400

51%

107%

39,341,100

23,313,700

69%

Ore processed - Sulphide

11,626,100

13,299,600

13,638,400

12,332,800

10,605,100

(13)%

10%

24,925,700

23,499,300

6%

Ore grade processed -

Sulphide (% TCu)(3)

1.21

1.16

1.28

1.33

1.34

4%

(10)%

1.18

1.29

(9)%

Production - copper in concentrate

124,400

130,200

157,400

139,700

124,500

(4)%

0%

254,600

262,100

(3)%

Anglo American's share of copper production for Collahuasi(4)

54,700

57,300

69,200

61,500

54,700

(5)%

0%

112,000

115,300

(3)%

El Soldado mine(2)

Ore mined

3,017,800

3,089,000

3,233,900

3,361,000

2,905,800

(2)%

4%

6,106,800

5,018,300

22%

Ore processed - Sulphide

1,861,900

1,809,900

1,951,600

2,036,000

1,825,000

3%

2%

3,671,800

3,610,600

2%

Ore grade processed -

Sulphide (% TCu)(3)

0.92

0.84

0.94

0.87

0.90

10%

2%

0.88

0.79

12%

Production - copper in concentrate

13,200

12,100

15,300

14,500

13,600

9%

(3)%

25,300

22,900

10%

Chagres Smelter(2)

Ore smelted

32,100

30,300

30,900

37,700

39,300

6%

(18)%

62,400

74,000

(16)%

Production

31,200

29,500

30,100

36,900

38,400

6%

(19)%

60,700

72,200

(16)%

Total copper production(5)

159,100

161,100

183,500

171,800

158,000

(1)%

1%

320,200

312,900

2%

Total payable copper production

153,100

155,000

177,100

165,700

152,600

(1)%

0%

308,100

301,700

2%

Total sales volumes

165,400

141,900

205,800

159,900

174,400

17%

(5)%

307,300

306,000

0%

Total payable sales volumes

159,100

136,500

198,400

154,200

168,400

17%

(6)%

295,600

295,100

0%

Third party sales(6)

88,800

53,400

50,400

51,800

40,700

66%

118%

142,200

71,500

99%

(1) Excludes copper production from the Platinum Group Metals business unit. Units shown are tonnes unless stated otherwise.

(2) Anglo American ownership interest of Los Bronces, El Soldado and the Chagres Smelter is 50.1%. Production is stated at 100% as Anglo American consolidates these operations.

(3) TCu = total copper.

(4) Anglo American's share of Collahuasi production is 44%.

(5) Total copper production includes Anglo American's 44% interest in Collahuasi.

(6) Relates to sales of copper not produced by Anglo American operations.

PLATINUM GROUP METALS (PGMs)

Platinum (000 oz)(1)

Q2

2019

Q2

2018

Q2 2019

vs.

Q2 2018

Q1

2019

Q2 2019 vs.

Q1 2019

H1 2019

H1 2018

H1 2019 vs.

H1 2018

Metal in concentrate production(2)

520.3

507.5

3%

471.9

10%

992.2

1,005.6

(1)%

Own mined(3)

342.8

340.2

1%

321.9

6%

664.7

683.2

(3)%

Purchase of concentrate (POC)(2)(4)

177.5

167.3

6%

150.0

18%

327.5

322.4

2%

POC now under tolling arrangement(5)

-

112.1

(100)%

-

n/a

-

227.8

(100)%

Palladium (000 oz)(1)

Metal in concentrate production(2)

347.2

349.8

(1)%

326.6

6%

673.8

698.9

(4)%

Own mined(3)

260.5

260.8

0%

250.9

4%

511.4

528.3

(3)%

Purchase of concentrate (POC)(2)(4)

86.7

89.0

(3)%

75.7

14%

162.4

170.6

(5)%

POC now under tolling arrangement(5)

-

56.2

(100)%

-

n/a

-

114.3

(100)%

Refined production

Platinum

000 oz(1)(6)

590.9

572.7

3%

411.7

44%

1,002.6

1,075.3

(7)%

Palladium

000 oz(1)(6)

428.2

366.7

17%

293.6

46%

721.8

686.5

5%

Rhodium

000 oz(1)(6)

84.1

73.8

14%

52.0

62%

136.1

136.3

0%

Gold

000 oz(1)(6)

21.3

27.3

(22)%

24.0

(11)%

45.3

50.2

(10)%

Nickel

t(6)

5,600

5,700

(2)%

4,200

33%

9,800

10,800

(9)%

Copper

t(6)

3,500

4,000

(13)%

3,200

9%

6,700

7,200

(7)%

Tolled material

Platinum

000 oz(1)

97.9

-

n/a

-

n/a

97.9

-

n/a

Palladium

000 oz(1)

49.1

-

n/a

-

n/a

49.1

-

n/a

(1) Ounces refer to troy ounces.

(2) Excluding purchase of concentrate volumes now treated under tolling arrangement.

(3) Includes managed operations and 50% of joint venture production.

(4) Includes 50% of joint venture production, and the purchase of concentrate from associates (BRPM prior to its disposal) and third parties.

(5) Comparative periods include purchase of concentrate volumes now under tolling arrangement.

(6) Refined production excludes toll material but includes in comparative periods material now transitioned to tolling.

Platinum production increased by 3% to 520,300 ounces while palladium production decreased by 1% to 347,200 ounces: both numbers exclude the impact of the transition of Sibanye-Stillwater Rustenburg material to a tolling arrangement in 2019.

Own mined production

Own mined platinum production increased by 1% to 342,800 ounces and palladium production is in line with Q2 2018 at 260,500 ounces.

Mogalakwena platinum production decreased by 4% to 127,900 ounces and palladium production by 4% to 139,500 ounces primarily due to mining through a higher waste area, as well as a decrease in concentrator throughput and recoveries.

Amandelbult platinum production is in line with the same period in the prior year at 116,600 ounces, while palladium production increased by 3% to 53,700 ounces. The development and ramp-up of the Dishaba section continues, resulting in an 18% improvement compared to Q1 2019.

Unki platinum production increased by 11% to 23,100 ounces and palladium by 14% to 20,900 ounces due to improved underground mining efficiencies as well as improved concentrator throughput, mill run-time and higher recoveries.

On a 100% basis, Mototolo platinum production decreased by 32% to 23,000 ounces and palladium production by 33% to 14,000 ounces due to two weeks of unprotected industrial action (impact of 4,000 platinum ounces and 2,500 palladium ounces) and lower grades. Furthermore, Q2 2018 included additional production treated at Bokoni.

Joint venture platinum production, excluding Mototolo, decreased by 1% to 104,400 ounces (of which 52,200 ounces was own mined production and 52,200 ounces was purchased concentrate) and palladium production decreased by 6% to 64,800 ounces (of which 32,400 ounces was own mined production and 32,400 ounces was purchased concentrate). This was driven by safety stoppages at Modikwa, partly offset by increased production at Kroondal. Including Mototolo, joint venture platinum production decreased by 25% and palladium production decreased by 28%, due to the acquisition of the remaining 50% of Mototolo in November 2018, after which it ceased to be a joint venture.

Purchase of concentrate

Purchase of platinum in concentrate increased by 6% to 177,500 ounces and palladium decreased by 3% to 86,700 ounces due to higher production at Bafokeng-Rasimone Platinum Mine and Union, offset by lower production from joint ventures as outlined above.

Refined production and sales volumes

Refined platinum production1 increased by 20% to 559,000 ounces and refined palladium production1 increased by 31% to 410,800 ounces. The increase was driven by improved operational performance at the converter plant.

Platinum sales volumes1 increased by 8% to 557,800 ounces and palladium sales volumes1 increased by 31% to 451,300, in line with refined production.

Full Year Guidance

Production guidance (metal in concentrate) remains unchanged at 2.0-2.1 million ounces of platinum and 1.3-1.4 million ounces of palladium.

(1) Does not include tolled volumes. Also excluding concentrate purchased from Sibanye-Stillwater.

Platinum

Q2

2019

Q1

2019

Q4

2018

Q3

2018

Q2

2018

Q2 2019 vs. Q1 2019

Q2 2019

vs.

Q2 2018

H1 2019

H1 2018

H1 2019 vs.

H1 2018

Produced platinum

(000 oz)(1)

520.3

471.9

485.4

529.5

507.5

10%

3%

992.2

1,005.6

(1)%

Own mined

342.8

321.9

307.5

332.9

340.2

6%

1%

664.7

683.2

(3)%

Mogalakwena

127.9

130.4

108.4

113.9

133.4

(2)%

(4)%

258.3

272.9

(5)%

Amandelbult

116.6

98.5

96.5

126.0

116.3

18%

0%

215.1

220.2

(2)%

Unki

23.1

19.3

22.0

22.4

20.9

20%

11%

42.4

41.4

2%

Mototolo(2)

23.0

26.8

17.5

-

-

(14)%

n/a

49.8

-

n/a

Joint ventures(2)

52.2

46.9

63.1

70.6

69.6

11%

(25)%

99.1

137.1

(28)%

Union

-

-

-

-

-

n/a

n/a

-

11.6

(100)%

Purchase of concentrate(3)

177.5

150.0

177.9

196.6

167.3

18%

6%

327.5

322.4

2%

Joint ventures(2)

52.2

46.9

63.1

70.6

69.6

11%

(25)%

99.1

137.1

(28)%

Associates(4)

-

-

46.9

66.7

54.3

n/a

(100)%

-

106.5

(100)%

Third parties(3)

125.3

103.1

67.9

59.3

43.4

22%

189%

228.4

78.7

190%

POC now under tolling arrangements(5)

-

-

116.9

119.5

112.1

n/a

(100)%

-

227.8

(100)%

Palladium

Produced palladium

(000 oz)(1)

347.2

326.6

328.5

351.4

349.8

6%

(1)%

673.8

698.9

(4)%

Own mined

260.5

250.9

234.8

250.2

260.8

4%

0%

511.4

528.3

(3)%

Mogalakwena

139.5

141.5

118.2

127.1

145.1

(1)%

(4)%

281.0

295.5

(5)%

Amandelbult

53.7

44.9

44.9

57.3

52.2

20%

3%

98.6

102.9

(4)%

Unki

20.9

17.0

19.6

19.7

18.4

23%

14%

37.9

36.2

5%

Mototolo(2)

14.0

16.3

10.9

-

-

(14)%

n/a

30.3

-

n/a

Joint ventures(2)

32.4

31.2

41.2

46.1

45.1

4%

(28)%

63.6

88.5

(28)%

Union

-

-

-

-

-

n/a

n/a

-

5.2

(100)%

Purchase of concentrate(3)

86.7

75.7

93.7

101.2

89.0

15%

(3)%

162.4

170.6

(5)%

Joint ventures(2)

32.4

31.2

41.2

46.1

45.1

4%

(28)%

63.6

88.5

(28)%

Associates(4)

-

-

19.3

27.2

22.0

n/a

(100)%

-

43.8

(100)%

Third parties(3)

54.3

44.5

33.2

27.9

21.9

22%

148%

98.8

38.3

158%

POC now under tolling arrangements(5)

-

-

58.1

59.4

56.2

n/a

(100)%

-

114.3

(100)%

Refined production

Platinum (000 oz)(1)(6)

590.9

411.7

770.9

556.2

572.7

44%

3%

1,002.6

1,075.3

(7)%

Palladium (000 oz)(1)(6)

428.2

293.6

493.8

321.5

366.7

46%

17%

721.8

686.5

5%

Rhodium (000 oz)(1)(6)

84.1

52.0

91.3

65.2

73.8

62%

14%

136.1

136.3

0%

Gold (000 oz)(1)(6)

21.3

24.0

27.9

27.4

27.3

(11)%

(22)%

45.3

50.2

(10)%

Nickel (tonnes)(6)

5,600

4,200

6,700

5,600

5,700

33%

(2)%

9,800

10,800

(9)%

Copper (tonnes)(6)

3,500

3,200

4,200

2,900

4,000

9%

(13)%

6,700

7,200

(7)%

Tolled material

Platinum (000 oz)(1)

97.9

-

-

-

-

n/a

n/a

97.9

-

n/a

Palladium (000 oz)(1)

49.1

-

-

-

-

n/a

n/a

49.1

-

n/a

Platinum sales volumes

(000 oz)(1)(8)

595.2

414.2

776.9

530.1

636.4

44%

(6)%

1,009.4

1,117.1

(10)%

Palladium sales volumes

(000 oz)(1)(8)

475.9

292.1

455.3

324.3

405.3

63%

17%

768.0

733.5

5%

Platinum 3rd party sales volumes (000 oz)(1)(9)

13.0

5.0

1.5

26.9

45.8

160%

(72)%

18.0

65.6

(73)%

Palladium 3rd party sales volumes (000 oz)(1)(9)

81.0

58.7

16.5

55.0

45.0

38%

80%

139.7

53.0

164%

4E head grade (g/t milled)(7)

3.55

3.58

3.38

3.58

3.60

(1)%

(1)%

3.57

3.52

1%

(1) Ounces refer to troy ounces.

(2) The joint venture operations are Modikwa and Kroondal. Platinum owns 50% of these operations, which is presented under 'Own mined' production, and purchases the remaining 50% of production, which is presented under 'Purchase of concentrate'. Mototolo is 100% owned from 1 November 2018.

(3) Excluding purchase of concentrate volumes now treated under tolling arrangement.

(4) 33% interest in BRPM until its sale effective 11 December 2018.

(5) Comparative periods include purchase of concentrate volumes now under tolling arrangement.

(6) Refined production excludes tolled material.

(7) 4E: the grade measured as the combined content of: platinum, palladium, rhodium and gold, excludes tolled material.

(8) Sales from own mined and purchased concentrate, excludes refined metal purchased from third parties.

(9) Relates to sales of metal not produced by Anglo American operations.

IRON ORE

Iron Ore (000 t)

Q2

2019

Q2

2018

Q2 2019

vs.

Q2 2018

Q1

2019

Q2 2019

vs.

Q1 2019

H1 2019

H1 2018

H1 2019

vs.

H1 2018

Kumba

10,544

11,572

(9)%

9,516

11%

20,060

22,427

(11)%

Minas-Rio(1)

5,915

106

n/a

4,910

20%

10,825

3,155

n/a

(1) Wet basis.

Kumba - Production decreased by 9% to 10.5 million tonnes as a result of reductions at both Sishen and Kolomela due to unscheduled plant maintenance. Subsequent improvements in plant stability resulted in an 11% increase in production in Q2 2019 compared with Q1 2019.

Sishen's production decreased by 8% to 7.3 million tonnes due to unscheduled plant maintenance, while waste movement decreased as planned by 6% to 41.8 million tonnes. Kolomela's production decreased by 11% to 3.2 million tonnes, due to extended maintenance at the dense media separation plant, while waste movement increased as planned by 38% to 18.1 million tonnes.

Total sales remained broadly flat at 10.5 million tonnes, with a 2% increase in export sales to 9.8 million tonnes due toan improvement in rail performance, partially offset by the impact on shipments of poor weather conditions in June. Finished stock at 30 June 2019 was 4.5 million tonnes, slightly higher compared with 4.2 million tonnes at 31 March 2019.

In the first half of 2019 the ratio of lump to fines in Kumba product was 68:32.

Minas-Rio- Production of 5.9 million tonnes was driven by a strong operational performance that reflects the optimisation work undertaken during 2018 while operations were suspended, and access to higher grade ore in the Step 3 mining area.

Construction of a tailings dam lift is under way and is expected to be complete in Q3 2019. The conversion of the installation licence to an operating licence for this lift is expected by year-end, subject to approval by the Minas Gerais state government in Brazil.

Full Year Guidance

Production guidance for Kumba has been revised to 42-43 million tonnes (previously 43-44 million tonnes) due to unscheduled plant maintenance in the first six months of the year.

Minas-Rio production guidance for 2019 is increased to 19-21 million tonnes (previously 18-20 million tonnes) based on the strong performance in the first six months of the year.

Iron Ore (tonnes)

Q2

2019

Q1

2019

Q4

2018

Q3

2018

Q2

2018

Q2 2019 vs.

Q1 2019

Q2 2019

vs.

Q2 2018

H1 2019

H1 2018

H1 2019

vs.

H1 2018

Kumba production

10,544,000

9,516,300

10,170,200

10,508,400

11,572,000

11%

(9)%

20,060,400

22,427,000

(11)%

Lump

7,111,400

6,544,600

6,878,600

7,159,800

7,889,600

9%

(10)%

13,656,100

15,133,100

(10)%

Fines

3,432,600

2,971,700

3,291,600

3,348,600

3,682,400

16%

(7)%

6,404,300

7,293,900

(12)%

Kumba production by mine

Sishen

7,310,400

6,446,600

6,960,500

7,030,600

7,930,300

13%

(8)%

13,757,000

15,254,900

(10)%

Kolomela

3,233,600

3,069,700

3,209,700

3,477,800

3,641,700

5%

(11)%

6,303,300

7,172,100

(12)%

Kumba sales volumes

Export iron ore

9,755,600

10,130,600

10,723,200

9,736,700

9,560,100

(4)%

2%

19,886,200

19,505,800

2%

Domestic iron ore

716,300

748,000

868,200

755,600

781,900

(4)%

(8)%

1,464,300

1,667,300

(12)%

Minas-Rio production

Pellet feed (wet basis)

5,915,500

4,909,700

226,700

-

105,800

20%

n/a

10,825,200

3,155,200

n/a

Minas-Rio sales volumes

Export - pellet feed (wet basis)

6,590,400

4,031,400

-

-

320,800

63%

n/a

10,621,800

3,216,800

n/a

COAL

Coal(1) (000 t)

Q2

2019

Q2

2018

Q2 2019

vs.

Q2 2018

Q1

2019

Q2 2019 vs.

Q1 2019

H1 2019

H1 2018

Q1 2019

vs.

Q4 2018

Metallurgical Coal (Australia)

5,844

5,262

11%

4,156

41%

10,000

10,801

(7)%

Export Thermal Coal (Australia)

245

290

(15)%

339

(28)%

584

499

17%

Export Thermal Coal (South Africa)(2)

4,575

4,440

3%

4,417

4%

8,992

8,767

3%

Export Thermal Coal (Colombia)

2,017

2,762

(27)%

2,199

(8)%

4,216

5,206

(19)%

Domestic Thermal Coal

(South Africa)

2,624

2,780

(6)%

2,290

15%

4,914

7,750

(37)%

(1) Anglo American's attributable share of production.

(2) Includes export primary production, secondary production sold into export markets and production sold domestically at export parity pricing.

Metallurgical Coal - Export metallurgical coal production increased by 11% to 5.8 million tonnes, due to a larger impact from longwall moves in Q2 2018 and an additional shovel at the Capcoal open cut operation. Longwall moves in the second half of 2019 are not expected to impact production materially.

In the second quarter, the ratio of hard coking coal production to PCI/semi-soft coking coal was approximately 85:15 (first half: 82:18, lower due to longwall moves at hard coking coal operations).

Thermal Coal South Africa- Export thermal coal production increased by 3% to 4.6 million tonnes, with solid operational performance across the portfolio offsetting planned decreases in production from sections approaching end of life at Khwezela and Goedehoop.

Domestic thermal coal production decreased by 6% to 2.6 million tonnes as coal from mineral residue deposits became less economic at prevailing prices.

Thermal Coal Colombia- Attributable export thermal coal production from Cerrejón decreased by 27% to 2.0 million tonnesdue to dust management restrictions.

The weighted average realised price in the first half for export thermal coal from South Africa and Colombia was $63/t, 9% lower than the weighted average quoted FOB price from South Africa and Colombia due to weaker market conditions and discounts on lower energy content coal.

Full Year Guidance

Production guidance for metallurgical coal is unchanged at 22-24 million tonnes.

Production guidance for export thermal coal is unchanged at 26-28 million tonnes.

Coal, by product (tonnes)(1)

Q2

2019

Q1

2019

Q4

2018

Q3

2018

Q2

2018

Q2 2019 vs.

Q1 2019

Q2 2019

vs.

Q2 2018

H1 2019

H1 2018

H1 2019

vs.

H1 2018

Metallurgical Coal (Australia)

5,843,500

4,156,200

5,647,100

5,382,300

5,261,900

41%

11%

9,999,700

10,801,100

(7)%

Hard Coking Coal

4,958,600

3,265,100

4,864,600

4,545,800

4,534,800

52%

9%

8,223,700

9,388,100

(12)%

PCI / SSCC

884,900

891,100

782,500

836,500

727,100

(1)%

22%

1,776,000

1,413,000

26%

Thermal Coal

9,460,700

9,245,000

10,613,700

10,816,800

10,271,300

2%

(8)%

18,705,600

22,221,600

(16)%

Export (Australia)

245,200

338,500

427,600

455,100

289,900

(28)%

(15)%

583,700

498,600

17%

Export (South Africa)(2)

4,575,000

4,417,000

4,537,100

5,054,400

4,439,600

4%

3%

8,991,900

8,767,100

3%

Export (Colombia)(3)

2,016,900

2,199,300

2,356,500

2,657,600

2,761,500

(8)%

(27)%

4,216,200

5,205,800

(19)%

Domestic (South Africa)

2,623,600

2,290,200

3,292,500

2,649,700

2,780,300

15%

(6)%

4,913,800

7,750,100

(37)%

Total coal production

15,304,200

13,401,200

16,260,800

16,199,100

15,533,200

14%

(1)%

28,705,300

33,022,700

(13)%

Sales volumes

Metallurgical Coal (Australia)

5,987,300

3,921,700

5,812,700

5,442,800

5,094,500

53%

18%

9,909,000

10,727,400

(8)%

Hard Coking Coal

4,944,300

3,290,600

5,064,200

4,834,100

4,402,800

50%

12%

8,234,900

9,288,300

(11)%

PCI / SSCC

1,043,000

631,100

748,500

608,700

691,700

65%

51%

1,674,100

1,439,100

16%

Thermal Coal

12,046,300

12,265,900

13,700,800

11,782,900

12,904,300

(2)%

(7)%

24,312,400

27,132,100

(10)%

Export (Australia)

270,900

451,200

582,200

331,600

357,800

(40)%

(24)%

722,100

651,600

11%

Export (South Africa)(2)

4,932,400

4,262,800

5,918,700

3,679,600

4,092,700

16%

21%

9,195,200

8,708,400

6%

Export (Colombia)(3)

2,244,800

2,199,600

2,297,200

2,589,100

2,762,900

2%

(19)%

4,444,500

5,243,100

(15)%

Domestic (South Africa)

2,016,700

2,402,800

1,947,500

3,305,800

3,146,500

(16)%

(36)%

4,419,500

7,857,500

(44)%

Third party sales

2,581,500

2,949,500

2,955,200

1,876,800

2,544,400

(12)%

1%

5,531,100

4,671,500

18%

(1) Anglo American's attributable share of production.

(2) Includes export primary production, secondary production sold into export markets and production sold domestically at export parity pricing.

(3) Anglo American's attributable share of Cerrejón production is 33.3%.

Coal, by operation (tonnes)(1)

Q2

2019

Q1

2019

Q4

2018

Q3

2018

Q2

2018

Q2 2019 vs.

Q1 2019

Q2 2019

vs.

Q2 2018

H1 2019

H1 2018

H1 2019

vs.

H1 2018

Metallurgical Coal (Australia)

5,843,500

4,156,200

5,647,100

5,382,300

5,261,900

41%

11%

9,999,700

10,801,100

(7)%

Moranbah North

1,603,200

239,500

2,485,200

1,275,800

1,064,300

569%

51%

1,842,700

3,001,000

(39)%

Grosvenor

1,032,500

1,333,200

356,100

1,239,800

1,342,000

(23)%

(23)%

2,365,700

2,167,600

9%

Capcoal (incl. Grasstree)

1,738,900

1,213,600

1,357,800

1,564,700

1,324,200

43%

31%

2,952,500

2,720,200

9%

Dawson

774,000

633,300

666,100

478,700

714,100

22%

8%

1,407,300

1,248,600

13%

Jellinbah

694,900

736,600

781,900

823,300

817,300

(6)%

(15)%

1,431,500

1,663,600

(14)%

Thermal Coal (Australia)

245,200

338,500

427,600

455,100

289,900

(28)%

(15)%

583,700

498,600

17%

Capcoal

63,700

64,000

81,000

71,600

66,000

-

(3)%

127,700

131,500

(3)%

Dawson

145,200

263,300

320,500

357,700

193,400

(45)%

(25)%

408,500

307,900

33%

Jellinbah

36,300

11,200

26,100

25,800

30,500

224%

19%

47,500

59,200

(20)%

Total Australia production

6,088,700

4,494,700

6,074,700

5,837,400

5,551,800

35%

10%

10,583,400

11,299,700

(6)%

Thermal (South Africa)(2)

Goedehoop

1,678,500

1,457,700

1,590,700

1,527,000

1,185,900

15%

42%

3,136,100

2,323,900

35%

Greenside

1,186,700

993,300

1,202,300

1,264,300

941,500

19%

26%

2,180,000

1,985,100

10%

Zibulo

1,394,600

1,319,600

1,681,500

1,468,700

1,553,500

6%

(10)%

2,714,100

3,226,600

(16)%

Khwezela

1,463,300

1,333,800

1,522,000

1,468,800

1,297,200

10%

13%

2,797,100

2,541,200

10%

Mafube

443,900

431,800

464,200

402,700

172,100

3%

158%

875,700

277,700

215%

Other(3)

-

-

-

604,100

1,076,700

n/a

(100)%

-

1,076,700

(100)%

Eskom-tied operations(4)

-

-

-

-

-

n/a

n/a

-

2,825,500

(100)%

Isibonelo

1,031,600

1,171,000

1,368,900

968,500

993,000

(12)%

4%

2,202,700

2,260,500

(3)%

Total South Africa production

7,198,600

6,707,200

7,829,600

7,704,100

7,219,900

7%

0%

13,905,700

16,517,200

(16)%

Colombia (Cerrejón)(5)

2,016,900

2,199,300

2,356,500

2,657,600

2,761,500

(8)%

(27)%

4,216,200

5,205,800

(19)%

Total Coal production

15,304,200

13,401,200

16,260,800

16,199,100

15,533,200

14%

(1)%

28,705,300

33,022,700

(13)%

(1) Anglo American's attributable share of production.

(2) Export and domestic production; the Eskom-tied operations and Isibonelo produce exclusively domestic volumes.

(3) Other production comes from the recovery of saleable product from mineral residue deposits.

(4) The sale of the Eskom-tied operations was completed on 1 March 2018.

(5) Anglo American's attributable share of Cerrejón production is 33.3%.

NICKEL

Nickel (tonnes)

Q2

2019

Q2

2018

Q2 2019

vs.

Q2 2018

Q1

2019

Q2 2019 vs.

Q1 2019

H1 2019

H1 2018

H1 2019

vs.

H1 2018

Nickel

9,800

10,800

(9)%

9,800

0%

19,600

19,400

1%

Nickel production decreased by 9% due to the timing of annual planned maintenance.

Full Year Guidance

Production guidance is unchanged at 42,000-44,000 tonnes.

Nickel(1)

Q2

2019

Q1

2019

Q4

2018

Q3

2018

Q2

2018

Q2 2019 vs.

Q1 2019

Q2 2019

vs.

Q2 2018

H1 2019

H1 2018

H1 2019

vs.

H1 2018

Barro Alto

Ore mined

1,365,400

888,000

816,500

1,640,400

1,208,800

54%

13%

2,253,400

2,210,300

2%

Ore processed

519,000

525,400

607,300

620,900

588,200

(1)%

(12)%

1,044,500

1,035,900

1%

Ore grade processed - %Ni

1.67

1.67

1.74

1.73

1.67

0%

0%

1.67

1.67

0%

Production

7,600

7,700

9,100

9,400

8,600

(1)%

(12)%

15,200

15,100

1%

Codemin

Ore mined

39,000

-

8,400

-

-

100%

100%

39,000

-

100%

Ore processed

148,900

139,900

150,600

139,100

150,600

6%

(1)%

288,800

291,800

(1)%

Ore grade processed - %Ni

1.62

1.62

1.68

1.69

1.62

0%

0%

1.62

1.64

(1)%

Production

2,300

2,100

2,300

2,100

2,200

10%

5%

4,400

4,300

2%

Total Nickel segment nickel production

9,800

9,800

11,400

11,500

10,800

-

(9)%

19,600

19,400

1%

Sales volumes

8,800

9,800

12,600

10,400

10,800

(10)%

(19)%

18,600

20,100

(7)%

(1) Excludes nickel production from the PGMs business unit.

MANGANESE

Manganese (000 t)

Q2

2019

Q2

2018

Q2 2019

vs.

Q2 2018

Q1 2019

Q2 2019 vs.

Q1 2019

H1 2019

H1 2018

H1 2019

vs.

H1 2018

Manganese ore(1)

826

866

(5)%

874

(5)%

1,700

1,747

(3)%

Manganese alloys(1)(2)

41

43

(4)%

35

17%

76

84

(9)%

(1) Saleable production.

(2) Production includes medium carbon ferro-manganese.

Manganese ore production decreased by 5% to 826,100 tonnes.

Manganese alloy production decreased by 4% to 41,200 tonnes.

Manganese (tonnes)

Q2

2019

Q1

2019

Q4

2018

Q3

2018

Q2

2018

Q2 2019 vs.

Q1 2019

Q2 2019

vs.

Q2 2018

H1 2019

H1 2018

H1 2019

vs.

H1 2018

Samancor

Manganese ore(1)

826,100

874,000

971,900

887,600

866,200

(5)%

(5)%

1,700,100

1,747,000

(3)%

Manganese alloys(1)(2)

41,200

35,200

38,000

34,800

42,800

17%

(4)%

76,400

84,000

(9)%

Samancor sales volumes

Manganese ore

958,400

843,400

959,800

840,400

910,100

14%

5%

1,801,800

1,734,300

(4)%

Manganese alloys

44,800

30,100

44,000

30,400

48,400

49%

(7)%

75,000

86,700

(13)%

(1) Saleable production.

(2) Production includes medium carbon ferro-manganese.

EXPLORATION AND EVALUATION

Exploration and evaluation expenditure was unchanged at $70 million. Exploration expenditure increased by 15% to $31 million driven by increased spend in De Beers and Metallurgical Coal. Evaluation expenditure decreased by 13% to $39 million driven by reduced spend in PGMs and Diamonds.

CORPORATE ACTIVITY AND OTHER ITEMS

As previously reported, the Copper business gave notice to terminate a long-term power supply contract. This resulted in a one-off negative impact of $179 million in special items. This is expected to result in improved cost performance in the medium and long term and support a transition to renewable sources of power.

REALISED PRICES SUMMARY

Average realised prices

H1 2019

H2 2018

H1 2018

FY 2018

H1 2019

vs.

H1 2018

H1 2019

vs.

H2 2018

De Beers

Total sales volumes (100)% (Mct)(1)

16.5

14.9

18.8

33.7

(12)%

11%

Consolidated sales volumes

(Mct)(1)

15.5

13.9

17.8

31.7

(13)%

12%

Consolidated average realised price ($/ct)(2)

151

182

162

171

(7)%

(17)%

Average price index(3)

118

122

123

123

(4)%

(3)%

PGMs

Platinum (US$/oz)

831

816

932

871

(11)%

2%

Palladium (US$/oz)

1,400

1,051

1,005

1,029

39%

33%

Rhodium (US$/oz)

2,840

2,429

1,938

2,204

47%

17%

Basket price (US$/Pt oz)

2,685

2,135

2,318

2,219

16%

26%

Copper (USc/lb)(4)

280

268

297

283

(6)%

4%

Iron Ore - FOB prices

Kumba Export (US$/dmt)(5)

108

76

69

72

57%

42%

Minas-Rio (US$/wmt)(6)

92

-

70

70

31%

n/a

Coal

Australia

Metallurgical - HCC (US$/t)(7)

195

191

198

194

(2)%

2%

Metallurgical - PCI (US$/t)(7)

123

128

129

128

(5)%

(4)%

Thermal - Export (US$/t)

88

105

99

103

(11)%

(16)%

South Africa

Thermal - Export (US$/t)(8)

64

87

88

87

(27)%

(26)%

Thermal - Domestic (US$/t, FOR)(9)

15

18

20

19

(25)%

(17)%

Colombia

Thermal - Export (US$/t)

62

87

79

83

(22)%

(29)%

Nickel (USc/lb)

563

541

632

588

(11)%

4%

(1) Consolidated sales volumes exclude De Beers' JV partners' 50% proportionate share of sales to entities outside De Beers from the Diamond Trading Company Botswana and the Namibia Diamond Trading Company, which are included in total sales volume (100% basis).

(2) Consolidated average realised price based on 100% selling value post-aggregation.

(3) Average of the De Beers price index for the Sights within the six-month period. The De Beers price index is relative to 100 as at December 2006.

(4) The realised price for Copper excludes third party sales volumes.

(5) Average realised export basket price (FOB Saldanha).

(6) Average realised export basket price (FOB Açu) (wet basis).

(7) Weighted average metallurgical coal sales price achieved.

(8) Weighted average export thermal coal price achieved. Excludes third party sales.

(9) Weighted average domestic thermal coal price achieved on all domestic thermal coal sales.

NOTES

· This Production Report for the quarter ended 30 June 2019 is unaudited.

· Production figures are sometimes more precise than the rounded numbers shown in this Production Report.

· Copper equivalent production shows changes in underlying production volume. It is calculated by expressing each commodity's volume as revenue, subsequently converting the revenue into copper equivalent units by dividing by the copper price (per tonne). Long-term forecast prices are used, in order that period-on-period comparisons exclude any impact for movements in price.

· Please refer to page 15 for information on forward-looking statements.

For further information, please contact:

Forward-looking statements:

This announcement includes forward-looking statements. All statements other than statements of historical facts included in this announcement, including, without limitation, those regarding Anglo American's financial position, business, acquisition and divestment strategy, dividend policy, plans and objectives of management for future operations (including development plans and objectives relating to Anglo American's products, production forecasts and Ore Reserves and Mineral Resources), are forward-looking statements. By their nature, such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Anglo American, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.

Such forward-looking statements are based on numerous assumptions regarding Anglo American's present and future business strategies and the environment in which Anglo American will operate in the future. Important factors that could cause Anglo American's actual results, performance or achievements to differ materially from those in the forward-looking statements include, among others, levels of actual production during any period, levels of global demand and commodity market prices, mineral resource exploration and development capabilities, recovery rates and other operational capabilities, the availability of mining and processing equipment, the ability to produce and transport products profitably, the availability of transportation infrastructure, the impact of foreign currency exchange rates on market prices and operating costs, the availability of sufficient credit, the effects of inflation, political uncertainty and economic conditions in relevant areas of the world, the actions of competitors, activities by governmental authorities such as permitting and changes in taxation or safety, health, environmental or other types of regulation in the countries where Anglo American operates, conflicts over land and resource ownership rights and such other risk factors identified in Anglo American's most recent Annual Report. Forward-looking statements should, therefore, be construed in light of such risk factors and undue reliance should not be placed on forward-looking statements.

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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, nickel and manganese - 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.

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