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Q3 2023 Production Report

24 October, 2023

Production Report for the third quarter ended 30 September 2023

Duncan Wanblad, Chief Executive of Anglo American, said: “Production in the third quarter overall was consistent with the same period in 2022. A 42% increase in copper production as Quellaveco's contribution ramps up was offset primarily by De Beers, as Venetia transitions to underground operations, and by performance at Moranbah and the Grosvenor ramp-up at the underground Steelmaking Coal operations.

"Our focus is on delivering our full year production guidance in line with a planned stronger second half of the year. Our production volumes increased by 4%(1) quarter-on-quarter, reflecting a step-up from our Steelmaking Coal operations driven by Aquila and at Grosvenor following the Q2 longwall move, operational improvements in the PGMs business and a progressive increase in volumes from Quellaveco. This was partially offset by planned maintenance programs at some operations and a planned reduction from Venetia, which continues to transition to underground operations. Copper production from Chile decreased due to ongoing ore hardness and an electrical substation fire at Los Bronces, resulting in a minor revision to guidance for our Chile operations. We are on track to deliver our full year guidance across all other products."

Q3 2023 highlights

  • Copper production increased by 42%, reflecting the progressive increase in production from Quellaveco in Peru, while production from our operations in Chile decreased by 4%.
  • Production from our Platinum Group Metals (PGMs) operations was broadly flat despite planned mining in a lower grade area at Mogalakwena.
  • Iron ore production decreased by 4%, principally driven by planned plant maintenance at Minas-Rio.
  • Nickel production decreased by 7%, mainly reflecting the impact of lower grades.
  • Steelmaking coal production decreased by 21%, reflecting challenging strata conditions at Moranbah and the ramp-up of Grosvenor during July following the longwall move in Q2.
  • Rough diamond production decreased by 23%, primarily due to the planned reduction as Venetia transitions to underground operations.
Production Q3 2023 Q3 2022 % vs. Q3 2022 YTD 2023 YTD 2022 % vs. YTD 2022
Copper (kt)(2) 209 147 42% 596 420 42%
Nickel (kt)(3) 9.3 10.0 (7)% 28.9 29.6 (2)%
Platinum group metals (koz)(4) 1,030 1,046 (2)% 2,874 3,034 (5)%
Diamonds (Mct)(5) 7.4 9.6 (23)% 23.9 26.5 (10)%
Iron ore (Mt)(6) 15.4 16.1 (4)% 46.1 43.6 6%
Steelmaking coal (Mt) 4.4 5.5 (21)% 11.2 10.4 9%
Manganese ore (kt) 1,012 973 4% 2,823 2,756 2%

(1) Total production across Anglo American’s products is calculated on a copper equivalent basis, including the equity share of De Beers’ production and using long-term consensus parameters. Copper equivalent production decreased by 1% compared to Q3 2022.
(2) Contained metal basis. Reflects copper production from the Copper operations in Chile and Peru only (excludes copper production from the Platinum Group Metals business).
(3) Reflects nickel production from the Nickel operations in Brazil only (excludes 5.4 kt of Q3 2023 nickel production from the Platinum Group Metals business).
(4) Produced ounces of metal in concentrate. 5E+Au (platinum, palladium, rhodium, ruthenium and iridium plus gold). Reflects own mined production and purchase of concentrate.
(5)De Beers Group production is on a 100% basis, except for the Gahcho Kué joint operation which is on an attributable 51% basis.
(6)Wet basis.

Production and unit cost guidance summary

  2023 production guidance 2023 unit cost guidance(1)
Copper(2) 830-870 kt
(previously 840-930 kt)
c.166 c/lb
Nickel(3) 38–40 kt c.560 c/lb
Platinum Group Metals(4) 3.6–4.0 Moz c.$1,000/oz
Diamonds(5) 30–33 Mct c.$75/ct
Iron Ore(6) 57–61 Mt c.$39/t
Steelmaking Coal(7) 16–19 Mt c.$105/t

(1) Unit costs exclude royalties and depreciation and include direct support costs only. FX rates used for Q4 2023 costs: ~900 CLP:USD, ~3.9 PEN:USD, ~5.0 BRL:USD, ~19 ZAR:USD, ~1.6 AUD:USD (previously ~800 CLP:USD, ~3.7 PEN:USD, ~4.8 BRL:USD, ~18 ZAR:USD, ~1.5 AUD:USD).
(2) Copper business only. On a contained-metal basis. Total copper production is the sum of Chile and Peru: Chile: c.520 kt (previously 530-580 kt) and Peru: 310-350 kt. Unit cost for Chile: c.205 c/lb and Peru: c.100 c/lb.
(3) Nickel operations in Brazil only. The Group also produces approximately 20 kt of nickel on an annual basis as a co-product from the PGM operations.
(4) 5E + gold produced metal in concentrate ounces. Includes own mined production (~65%) and purchased concentrate volumes (~35%). The split of metals differs for own mined and purchased concentrate, refer to FY2022 results presentation slide 42 for indicative split of own mined volumes. 2023 metal in concentrate production is expected to be 1.6–1.8 Moz of platinum, 1.2–1.3 Moz of palladium and 0.8–0.9 Moz of other PGMs and gold. 5E + gold refined production is expected to be 3.6–4.0 Moz, subject to the impact of Eskom load-curtailment. Unit cost is per own mined 5E + gold PGMs metal in concentrate ounce.
(5) Production on a 100% basis, except for the Gahcho Kué joint operation, which is on an attributable 51% basis. Venetia continues to transition to underground operations. Unit cost is based on De Beers' share of production.
(6) Wet basis. Total iron ore is the sum of operations at Kumba in South Africa and Minas-Rio in Brazil. Kumba: 35–37 Mt and Minas-Rio: 22–24 Mt. Kumba production is subject to the third-party rail and port performance. Unit cost for Kumba: c.$43/t and Minas-Rio: c.$33/t.
(7) Production excludes thermal coal by-product. FOB unit cost comprises managed operations and excludes royalties and study costs.

Realised prices

  Q3 YTD 2023 Q3 YTD 2022 Q3 YTD 2023 vs Q3 YTD 2022
Copper (USc/lb)(1) 387 377 3 %
Copper Chile (USc/lb)(2) 388 377 3 %
Copper Peru (USc/lb) 386 341 13 %
Nickel (US$/lb) 8.29 10.68 (22) %
Platinum Group Metals
Platinum (US$/oz)(3) 981 937 5 %
Palladium (US$/oz)(3) 1,437 2,107 (32) %
Rhodium (US$/oz)(3) 7,366 16,139 (54) %
Basket price (US$/PGM oz)(4) 1,766 2,627 (33) %
Iron Ore – FOB prices(5) 108 115 (6) %
Kumba Export (US$/wmt)(6) 110 115 (4) %
Minas-Rio (US$/wmt)(7) 106 114 (7) %
Steelmaking Coal – HCC (US$/t)(8) 264 324 (19) %
Steelmaking Coal – PCI (US$/t)(8) 215 279 (23) %

(1) Average realised total copper price is a weighted average of the Copper Chile and Copper Peru realised prices.
(2) Realised price for Copper Chile excludes third-party sales volumes.
(3) Realised price excludes trading.
(4) Price for a basket of goods per PGM oz. The dollar basket price is the net sales revenue from all metals sold (PGMs, base metals and other metals) excluding trading, per PGM 5E + gold ounces sold (own mined and purchased concentrate) excluding trading.
(5) Average realised total iron ore price is a weighted average of the Kumba and Minas-Rio realised prices.
(6) Average realised export basket price (FOB Saldanha) (wet basis as product is shipped with ~1.6% moisture). The realised prices could differ to Kumba's stand-alone results due to sales to other Group companies. Average realised export basket price (FOB Saldanha) on a dry basis is $112/t (Q3 YTD 2022: $117/t), higher than the dry 62% Fe benchmark price of $102/t (FOB South Africa, adjusted for freight).
(7) Average realised export basket price (FOB Açu) (wet basis as product is shipped with ~9% moisture).
(8) Weighted average coal sales price achieved at managed operations. Australian thermal coal by-product for Q3 YTD 2023, decreased by 50% to $156/t (Q3 YTD 2022: $309/t).

Notes

  • This Production Report for the third quarter ended 30 September 2023 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, and includes the equity share of De Beers’ production. It is calculated by expressing each product’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 16 for information on forward-looking statements.

In this document, references to “Anglo American”, the “Anglo American Group”, the “Group”, “we”, “us”, and “our” are to refer to either Anglo American plc and its subsidiaries and/or those who work for them generally, or where it is not necessary to refer to a particular entity, entities or persons. The use of those generic terms herein is for convenience only, and is in no way indicative of how the Anglo American Group or any entity within it is structured, managed or controlled. Anglo American subsidiaries, and their management, are responsible for their own day-to-day operations, including but not limited to securing and maintaining all relevant licences and permits, operational adaptation and implementation of Group policies, management, training and any applicable local grievance mechanisms. Anglo American produces Group-wide policies and procedures to ensure best uniform practices and standardisation across the Anglo American Group but is not responsible for the day to day implementation of such policies. Such policies and procedures constitute prescribed minimum standards only. Group operating subsidiaries are responsible for adapting those policies and procedures to reflect local conditions where appropriate, and for implementation, oversight and monitoring within their specific businesses.

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Media Investors
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Rebecca Meeson-Frizelle Juliet Newth
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South Africa Michelle Jarman
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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 operations, with a broad range of future development options, provides many of the future-enabling metals and minerals for a cleaner, greener, more sustainable world and that meet the fast growing every day demands of billions of consumers. With our people at the heart of our business, we use innovative practices and the latest technologies to discover new resources and to mine, process, move and market our products to our customers – safely and sustainably.

As a responsible producer of copper, nickel, platinum group metals, diamonds (through De Beers), and premium quality iron ore and steelmaking coal – with crop nutrients in development – we are committed to being carbon neutral across our operations by 2040. More broadly, our Sustainable Mining Plan commits us to a series of stretching goals to ensure we work towards a healthy environment, creating thriving communities and building trust as a corporate leader. We work together with our business partners and diverse stakeholders to unlock enduring value from precious natural resources for the benefit of the communities and countries in which we operate, for society as a whole, and for our shareholders. Anglo American is re-imagining mining to improve people’s lives.

www.angloamerican.com

Forward-looking statements and third-party information:

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, prospects and projects (including development plans and objectives relating to Anglo American’s products, production forecasts and Ore Reserve and Mineral Resource positions) and sustainability performance related (including environmental, social and governance) goals, ambitions, targets, visions, milestones and aspirations, 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, unanticipated downturns in business relationships with customers or their purchases from Anglo American, mineral resource exploration and project development capabilities and delivery, recovery rates and other operational capabilities, safety, health or environmental incidents, the effects of global pandemics and outbreaks of infectious diseases, the impact of attacks from third parties on our information systems, natural catastrophes or adverse geological conditions, climate change and extreme weather events, the outcome of litigation or regulatory proceedings, the availability of mining and processing equipment, the ability to obtain key inputs in a timely manner, the ability to produce and transport products profitably, the availability of necessary infrastructure (including transportation) services, the development, efficacy and adoption of new or competing technology, challenges in realising resource estimates or discovering new economic mineralisation, the impact of foreign currency exchange rates on market prices and operating costs, the availability of sufficient credit, liquidity and counterparty risks, the effects of inflation, terrorism, war, conflict, political or civil unrest, uncertainty, tensions and disputes and economic and financial conditions around the world, evolving societal and stakeholder requirements and expectations, shortages of skilled employees, unexpected difficulties relating to acquisitions or divestitures, competitive pressures and the actions of competitors, activities by courts, regulators and governmental authorities such as in relation to permitting or forcing closure of mines and ceasing of operations or maintenance of Anglo American’s assets 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.

These forward-looking statements speak only as of the date of this announcement. Anglo American expressly disclaims any obligation or undertaking (except as required by applicable law, the City Code on Takeovers and Mergers, the UK Listing Rules, the Disclosure and Transparency Rules of the Financial Conduct Authority, the Listings Requirements of the securities exchange of the JSE Limited in South Africa, the SIX Swiss Exchange, the Botswana Stock Exchange and the Namibian Stock Exchange and any other applicable regulations) to release publicly any updates or revisions to any forward-looking statement contained herein to reflect any change in Anglo American’s expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

Nothing in this announcement should be interpreted to mean that future earnings per share of Anglo American will necessarily match or exceed its historical published earnings per share. Certain statistical and other information included in this announcement is sourced from third-party sources (including, but not limited to, externally conducted studies and trials). As such it has not been independently verified and presents the views of those third parties, but may not necessarily correspond to the views held by Anglo American and Anglo American expressly disclaims any responsibility for, or liability in respect of, such information.