AA builds operational momentum for next phase of value-driven growth
Anglo American is providing an update on its performance during 2022 and capital expenditure and production guidance for the next three financial years.
Duncan Wanblad, Chief Executive of Anglo American, said: “This year has seen us focus on our immediate priorities of safety and restoring normal operational disciplines given the pandemic related disruptions of the last few years. In 2022, these have been added to by geopolitically-led economic volatility, and extreme weather and other localised disruptions at our operations.
“As we have built operational momentum in the second half, we have also moderated our near term production growth plans with a clear priority to deliver a stable platform from which to build strengthened and repeatable performance. This allows us to invest in increased ore reserve flexibility and systematically implement our P101 best practice programme of equipment and process performance. We have also taken the opportunity to re-phase certain of our growth investments to ensure optimal sequencing for long term value creation in the current high inflationary and dynamic external environment.
“Anglo American offers a highly differentiated investment proposition, founded upon our high quality diversified portfolio of future-enabling products and our depth of growth optionality, underpinned by our operating model and track record of innovation. Together, these position us strongly for the structurally attractive longer term, notwithstanding current market volatility. Our unwavering focus is on driving safe, consistent performance across our operations, delivering value-adding growth and progressing towards our full suite of sustainability ambitions – including our 2040 carbon neutral operations commitment.”
Anglo American to continue its improvement and growth momentum:
2022
- Production down by c.3%: Quellaveco copper ramp-up and strong diamond production, offset by ore grades in Chile and lower production from Kumba and PGMs
- Unit costs up c.16%: above CPI inflation and some production decreases
- Capex of c.$5.7 billion: lower due to supply chain disruptions, people availability and FX
- Year-end working capital build of $2.0 – 2.5 billion, subject to pricing: inventories expected to partially unwind in 2023
2023
- Production expected to increase by 5%(1) as Quellaveco ramps up
- Unit costs expected to increase by c.3%(2): inflation expected to moderate; and the benefit of Quellaveco
- Capex forecast of $6.0 – 6.5 billion, including $0.8 billion for Woodsmith
- Expected review of Woodsmith year-end carrying value for accounting purposes
2024
- Production expected to increase by 5%(1): led by copper, iron ore and steelmaking coal
- Capex forecast of $5.5 – 6.0 billion
2025
- Production expected to be in line with 2024
- Capex forecast of $5.0 – 5.5 billion
