Performance against strategic objectives
STRONG momentum maintained
in the drive to achieve our five strategic objectives
Improve portfolio quality
The gold price continued to decline in 2014. Focus on improving the quality of the portfolio was sustained, while maintaining cash flows and improving returns remained priorities. Production increased for the second consecutive year, due in large part to Tropicana and Kibali each having had their first full year of production. In line with our aim to simplify our portfolio and focus on quality ounces, the closure of Yatela was progressed, Navachab was sold, the CC&V expansion project was advanced, and operations at Obuasi in Ghana were significantly downscaled while a feasibility study is conducted on its future viability. A maiden Mineral Resource for the Nuevo Chaquiro deposit in Colombia was announced.
Focus on people, safety
People are the business, whether they be employees, host communities or other stakeholders affected by our activities. Our aim to drive sustainable cash flow improvements through our operations depends on our ability to operate safely, to operate with the cooperation and consent of our host communities and governments, and to remain careful stewards of the environment notwithstanding the invasive nature of mining. With these fundamental points guiding us at all times, we recorded the best ever safety performance in AngloGold Ashanti’s history while also posting a record environmental performance, measured by the number of reportable incidents logged during the year. Furthermore, achieving our business objectives enables us to contribute to local socio-economic development, albeit at a lower level in 2014, reflecting deterioration in market conditions. While we're immensely proud of the progress we have made in core sustainability areas, we remain mindful of the fact that there is no room for complacency as we seek to achieve our ultimate goal of zero harm in the workplace and minimising our impact on the environment.
Maintain long-term optionality
Again, the tight rein on capital expenditure continued. Following exits from non-core jurisdictions, exploration focused on more prospective areas in Australia, Colombia and Guinea. In addition to the savings achieved in 2013, additional savings were realised in 2014.
Optimise overhead, costs and capital expenditure
Costs improved significantly across every metric during 2014, the result of continued focus on all expenditures and disciplined allocation of capital. All-in sustaining costs, which capture direct operating costs and sustaining capital, as well as corporate overheads and exploration, fell 13% to $1,026/oz in 2014 compared with $1,174/oz in 2013. All-in costs, which also include capital expenditure on projects, dropped 22% over the same period, to $1,148/oz from $1,466/oz the previous year.
Ensure financial flexibility
Our prudent approach to managing the balance sheet and reducing exposure to financial risk yielded positive results. Self-help measures were implemented to enable deleveraging and to increase covenant headroom. The debt maturity profile was extended, maintaining good liquidity from multiple sources.