JOHANNESBURG — AngloGold Ashanti, the world’s third-largest gold producer, reported a worse-than-expected drop in fourth-quarter earnings on Wednesday, hit by higher costs and a slightly lower gold price.
The group’s adjusted headline earnings per share for October-December fell 35% to 76 US cents per share, from 118 cents in the previous quarter.
The results were well below the average estimate of 109,4 cents in a poll of five analysts by Reuters. Its share price opened 0,54% lower, underperforming a 0,50% rise in Johannesburg’s benchmark index.
The company said it was hit by higher cash costs, higher levels of unsold gold and the impact of a $105 million provision related to environmental costs.
The average dollar gold price during the quarter was down marginally to $1,684 per ounce.
But weakness in the South African currency meant in rand terms the average price during the October-December quarter was up 12% to a record 438 000 rand/kg.
AngloGold gets about 40% of its output from its home base so this helps its bottom line, but not to the same extent as smaller rivals such as Harmony Gold which rely on South Africa for a far higher percentage of their output.
The miner said for 2012 it expected gold production of 4,3 to 4,4 million ounces, virtually uchanged from the 4,33 million ounces it recorded last year.
It declared a fourth-quarter dividend of 200 South African cents a share, more than double the third-quarter payout of 90 cents. The full-year dividend of 380 cents compares with the 2010 full-year dividend of 145 cents.
“We will continue to look to grow the dividend where appropriate,” chief executive Mark Cutifani said on a media call after the announcement. He also said he saw the gold price poking through $2 000 an ounce this year.
Spot gold edged up slightly to $1 726 an ounce in early trade on Wednesday.