[PPT] - 2008 Annual Results Presentation Neville Nicolau Bongani Nqwababa PowerPoint Presentation

SLIDE 1

1 2008 Annual results

2008 Annual Results Presentation

Neville Nicolau Bongani Nqwababa 9 February 2009

SLIDE 2

2 2008 Annual results

2008 Highlights

Noticeable improvement in safety
Record headline earnings of R13.3 billion, up 8%
2.39 million refined platinum ounces in line with mid year forecast
2.22 million ounces sold
Unit operating costs per equivalent refined platinum ounce up 35.6%
New mining right conversions, ESOP in place
Global economic impacts addressed

SLIDE 3

3 2008 Annual results

Safety

Safety is our first value Zero is possible

SLIDE 4

4 2008 Annual results

Managed operations injury frequency rate down (LTIFR 2.03 to 1.74)
Increased safety excellence – 34 sites achieved 1 million fatality free shifts up from 11
Anglo Group “Safety Way” management system

Significant operational safety achievements

Union: 6.6 million fatality free shifts and

10 million fall of ground fatality free shifts

Lebowa: 2 million fatality free shifts
Mortimer Smelter: 3 years and 8 months LTI free
Rustenburg Mine: 6 million fall of ground

fatality free shifts

Safety

2.03 1.82 2.05 1.8 1.52 LTI / 200 000 hours 2007 Q1 2008 Q2 2008 Q3 2008 Q4 2008

SLIDE 5

5 2008 Annual results

Operations performance

1194

Equivalent refined platinum production from operations

2,000 2,100 2,200 2,300 2,400 2,500 2,600 2,700

2007 KPM Mod Mar AS RS Mog BRPM Leb US Mot Tw ick WLTR Other purchases 2008

000's oz

2,471 83 18 9 (121) (60) 25 (19) (20) (2) 2,465 5 (8) 84

Flood event
Safety issues
Turffontein closure
Safety issues
Labour issues
Mainly purchases

from Eland Platinum

SLIDE 6

6 2008 Annual results

Major challenges in 2008

Challenges Remedial Action Amandelbult flooding Returned to full production – dewatered in 8 weeks Electricity supply constraints 90% adequate for 2.39m refined ounces Turffontein rehabilitation Completed on schedule Mogalakwena concentrator Availability returned – North commissioning Smelter run-out incidents Downtime minimised – 2.39m refined ounces Safety stoppages Safety improvement plan rolled-out Input cost inflation >> CPI Manage supply chain – quick reductions

SLIDE 7

7 2008 Annual results

Short term action

2009 – 2.4 million ounces in line with near term demand
Cost management to reduce operating costs
Achieve supply chain benefits quickly
Focus on productivity improvements
Reduce number of contract employees
Employee retrenchment avoidance measures
Freeze all non-critical appointments
No overtime
Re-skilling and re-deployment
Debt management in place
Respond to change on an ongoing basis

SLIDE 8

8 2008 Annual results

Financial overview Bongani Nqwababa

SLIDE 9

9 2008 Annual results

Financial performance

Year ended 31 Dec R million 2008 2007 Change Net sales revenue 50,765 46,616 9% Gross profit on metal sales 17,083 19,097 11% Gross profit margin (%) 33.7% 41.0% 18% Effective tax rate % 23,4% 34,4% 32% Headline earnings 13,292 12,325 8% Headline earnings per share (cents) 5,609 5,239 7% Capital expenditure 14,388 10,653 35% Net debt (13,459) (4,086) 229% Full year ordinary dividends (cents) 3,500 5,200 33%

SLIDE 10

10 2008 Annual results

Headline earnings

Headline earnings increased by 8%

12,325 13,292 4,975 3,713 (35) (405) (293) (1,693) (5,221) (2,055) 1,981 5,000 7,000 9,000 11,000 13,000 15,000 17,000 19,000 21,000 23,000 25,000

2007 Price Exchange Tax Sales volume Cost Inflation Associates & minorities Amortisation Interest 2008

R million

SLIDE 11

11 2008 Annual results

13,292 12,325 3,713 4,975 1,981 (2,055) (5,221) (1,693) (293) (405) (35) 5,000 7,000 9,000 11,000 13,000 15,000 17,000 19,000 21,000 23,000 25,000

2007 Price Exchange Tax Sales volume Cost Inflation Associates & minorities Amortisation Interest 2008

R million

Headline earnings - price variance

Exchange rate weaker: Ave 2008 – R8.08/$1 Ave 2007 – R7.04/$1 Pt $ price up 20.6% Rh $ price up 19.1% Ni $ price down 42.5%

SLIDE 12

12 2008 Annual results

Platinum basket price

Market price movement from 2007 to 2009

5,000

10,000 15,000 20,000 25,000 30,000 35,000 40,000 R and basket price per Pt ounce 2007 H1 2008 H2 2008 2009

R20,780 $2,906 R24,798 $3,040 R29,848 $3,813 R20,215 $2,268

SLIDE 13

13 2008 Annual results

Tax variance

Reduced taxation contributed to increased headline earnings

5,779 6,656 (462) 4,470

518

321 96

4,470

(518) 3,000 3,500 4,000 4,500 5,000 5,500 6,000 6,500 7,000 2007 STC election on AA plc dividend Lower SA tax rate Lower SA STC tax rate of 10% Other 2008

R m illion

(329) (877)

SLIDE 14

14 2008 Annual results

12,325 13,292 4,975 3,713 (35) (405) (293) (1,693) (5,221) (2,055) 1,981 5,000 7,000 9,000 11,000 13,000 15,000 17,000 19,000 21,000 23,000 25,000

2007 Price Exchange Tax Sales volume Cost Inflation Associates & minorities Amortisation Interest 2008

R million

Headline Earnings - volume and cost variance

Pt – R2.0bn Rh – R1.3bn Other – R1.9bn Metal Purch. R2.2bn Labour R511m Process material R343m Positive stock movement kof (R1.8bn)

SLIDE 15

15 2008 Annual results

Operating unit costs

26.6% 6.5% 35.6% 2.9% 0.4% 0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%

CPI & escalation Efficiency improvements Mogalakwena Grade & Recovery R / Eq refined Pt oz

% Increase

CPI = 11.4% Labour = 2.3% Commodities = 4.4% Contractors = 3.1% Sundries = 2.9% Utilities = 2.5% Higher UG2 Increased volumes offset by grade & recovery reductions

SLIDE 16

16 2008 Annual results

2008 operating margins

A S 4, 1 %

0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50% 55% 60%

239

478 717 956 1,195 1,434 1,673 1,912 2,151 2,390 Refined production ('000) Operating margin % MDK 29% BRPM 46% MAR 12% MOT 53% RS 36% MOG 29% WLTR 43% AS 56% LPM 32% US 50% Purchased Metal 11% KPM 58%

Group average excluding purchased metal: 44% Group average including purchased metal: 37%

SLIDE 17

17 2008 Annual results

Net debt

(4,086)

(13,459) (14,237) (1,665) 1,759 19,243 (14,388) (20,000) (15,000) (10,000) (5,000) 5,000 10,000 15,000 20,000 Dec 2007 Net debt Cash from

perations

Tax & interest Dividends Capex Sale of Investments Other Dec 2008 Net debt

R million

85

SLIDE 18

18 2008 Annual results

Balance sheet highlights

Year ended 31 Dec R million 2008 2007 Change PPE & CWIP 46,571 36,258 28% Inventories 10,064 6,370 58% Trade & other receivables 3,941 4,246

8%

Deferred tax 11,101 8,748 27% Trade & other payables 4,956 4,105 21% Net debt 13,459 4,086 229%

Long term borrowings

10,313 2,713 280%

Short term borrowings

5,507 4,962 11%

Cash & cash equivalents

2,870 4,079 30%

Other borrowings

509 490 4%

SLIDE 19

19 2008 Annual results

Capital management

Interim dividend of R35.00 declared per ordinary share
No final ordinary dividend
1.6 dividend cover for the full year (2007: 1.0)
Year end net debt of R13.5 billion (2007: R4.1bn)
Long term debt R10.3 billion (2007: R2.7bn)
Committed debt facilities of R26 billion (2007: R16bn)

SLIDE 20

20 2008 Annual results

Markets and outlook Neville Nicolau

SLIDE 21

21 2008 Annual results

Platinum market - price

12,500 15,000 17,500 20,000 22,500 25,000 27,500 30,000 32,500 35,000 Rand basket price per Pt ounce 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000 2,200 2,400 $ Pt spot market price Rand basket price $ Pt spot price

2007 2009 H1 2008 H2 2008

SLIDE 22

22 2008 Annual results

Speculative investment

Massive long liquidation – downside overcorrection – 2009 sentiment up

NET POSITION OF PLATINUM SPECULATORS

200,000 400,000 600,000 800,000 1,000,000 1,200,000 1,400,000 1,600,000 700 800 900 1000 1100 1200 1300 1400 1500 1600 1700 1800 1900 2000 2100 2200 2300

NYMEX Tocom EFTS Price (oz ') ($/oz ) Apr '07 Dec '08 Dec '07 ETFs

SLIDE 23

23 2008 Annual results

Platinum market - strong fundamentals

Vehicle volumes down
North America sales down 18% from

2007 to 2008

Total sales down 2% from 2007 to 2008

500 1,000 1,500 2,000 2,500 J a n 7 F e b M a r A p r M a y J u n e J u l y A u g S e p O c t N

v

D e c J a n 8 F e b M a r A p r M a y J u n J u l A u g S e p O c t N

v

D e c SGE 6 month ave Average JM base price

Shanghai Gold Exchange – Platinum volumes

But positive response from jewellery and

investment

Investment bar sales in Japan up 400%

2006 2007 2008 Rest of world 16.5 18.9 19.6 China 7.3 9.0 9.8 North America 14.2 13.4 11.0 Japan 10.7 10.7 10.8 Europe 20.1 21.2 20.5 Vehicle sales (million )

SLIDE 24

24 2008 Annual results

Platinum market - supply down

2008 supply / demand deficit over full year
2009 South African production declining or flat
Impact of capex and workforce reductions on future production

South Africa 5,295 5,032 4,710 Rest of world 1,535 1,530 1,368 TOTAL 6,830 6,562 6,078 Platinum Supply - Anglo Platinum estimates 2006 2007 2008

SLIDE 25

25 2008 Annual results

Safe profitable platinum

Long term initiatives
Values & Culture launch completed
Restructuring of large mines into smaller units
Changing safety, labour & technical environment
Long term projects continued in 2008
Entire project suite schedule extended
Strategy
Adapting to the short term
Long term strategy remains unchanged

SLIDE 26

26 2008 Annual results

Summary

Short term strategy in place
Production at 2.4m oz in 2009
Cost management and cost reduction in place
Debt funding in place
Anglo Platinum will respond on an ongoing basis to industry challenges
Should economic conditions deteriorate we will take appropriate action
A balanced market in 2009 – sentiment improved
Safety is our first value