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Q3 2024 Production Report

24 October, 2024

Production Report for the third quarter ended 30 September 2024

Duncan Wanblad, Chief Executive of Anglo American, said: “Our consistent focus on operational excellence continues to deliver stable production in line with our expectations. Our Minas-Rio iron ore operation in Brazil achieved a second successive record quarter while the reshaping of our copper operations continues to progress, with the older of the two Los Bronces plants placed on care and maintenance. Ongoing stability at the PGM processing assets allows us to increase full year refined PGM production guidance to 3.7–3.9 million ounces1, and strong operational performance at Nickel increases production guidance to 38,000-39,000 tonnes1, lowering the unit cost guidance to c.530 c/lb1. All other production and unit cost2 guidance is unchanged.

"Our accelerated portfolio simplification to unlock the inherent value in Anglo American is well under way. The PGMs demerger is on track to complete by the middle of 2025. Our Steelmaking Coal sale process continues to see significant competition for this world-class set of assets, with a final round of bidders in place, and we expect to announce execution of a sale agreement in the coming months. We are also encouraged by recent imagery that shows that the fire damage in the underground area of the Grosvenor mine appears limited, further supporting the sale process.

"As previously announced, we reduced rough diamond production from De Beers in response to market conditions. The diamond market remains challenging as the midstream continues to hold higher than normal levels of inventory and the expectation remains for a protracted recovery. As a result and together with our partners, we will continue to assess the options to reduce production going forward.

"We are making excellent progress with our portfolio simplification to create an exciting and differentiated investment proposition focused on our world-class copper, premium iron ore and crop nutrients assets - all future-enabling products. This highly cash generative and much higher margin portfolio will offer greater resilience through cycles with the benefit of significant high quality and well sequenced growth options, including a clear path to increase annual copper production to more than one million tonnes by the early 2030's."

 Q3 2024 highlights

  • Copper production is on track to meet full year guidance, decreasing 13% in the quarter as expected versus the comparative period, due to the planned closure of the smaller and more costly Los Bronces plant, partially offset by higher grades at El Soldado. Production at Quellaveco in Peru is expected to increase in the fourth quarter as grades and recoveries improve.
  • In Iron Ore, production was 2% higher as Minas-Rio achieved a record third quarter performance, reflecting enhanced operational stability, partially offset by a planned decrease at Kumba to align with third-party logistics constraints. In October, the Brazilian anti-trust regulator approved the Serpentina transaction with Vale, and this is on track to close in the fourth quarter.
  • Steelmaking coal production decreased by 6%, primarily driven by the cessation of mining at Grosvenor following the underground fire in June 2024. Excluding the impacts of Grosvenor, steelmaking coal production increased by 3%, reflecting higher production from the Dawson open cut operation and Moranbah longwall operation.
  • Production from our Platinum Group Metals (PGMs) operations decreased 10% versus the comparative period, primarily reflecting the expected lower metal in concentrate production in line with 2024 guidance. On a quarter-on-quarter basis, production was flat.
  • Nickel production increased by 6% largely due to operational improvements at Barro Alto.
  • Rough diamond production decreased by 25%, reflecting a production response to the prolonged period of lower demand, higher than normal levels of inventory in the midstream and a continued focus on managing working capital.
Production Q3 2024 Q3 2023 % vs. Q3 2023 YTD 2024 YTD 2023 % vs. YTD 2023
Copper (kt)(3) 181 209 (13)% 575 596 (4)%
Iron ore (Mt)(4) 15.7 15.4 2% 46.5 46.1 1%
Platinum group metals (koz)(5) 922 1,030 (10)% 2,677 2,874 (7)%
Diamonds (Mct)(6) 5.6 7.4 (25)% 18.9 23.9 (21)%
Steelmaking coal (Mt) 4.1 4.4 (6)% 12.1 11.2 8%
Nickel (kt)(7) 9.9 9.3 6% 29.4 28.9 2%
Manganese ore (kt) 406 1,012 (60)% 1,545 2,823 (45)%

(1) Refined PGM production was previously 3.3-3.7 million ounces. Nickel production was previously 36,000-38,000 tonnes and the unit cost was c.550 c/lb.
(2) FX rates in 2024 unit cost guidance: c.850 CLP:USD, c.3.7 PEN:USD, c.5.0 BRL:USD, c.19 ZAR:USD, c.1.5 AUD:USD.
(3) Contained metal basis. Reflects copper production from the Copper operations in Chile and Peru only (excludes copper production from the Platinum Group Metals business).
(4) Wet basis.
(5) Produced ounces of metal in concentrate. 5E + gold (platinum, palladium, rhodium, ruthenium and iridium plus gold). Reflects own mined production and purchase of concentrate.
(6) Production is on a 100% basis, except for the Gahcho Kué joint operation which is on an attributable 51% basis.
(7) Reflects nickel production from the Nickel operations in Brazil only (excludes 7.4 kt of Q3 2024 nickel production from the Platinum Group Metals business).

Production and unit cost guidance summary

  2024 production guidance 2024 unit cost guidance(1)
Copper(2) 730–790 kt c.157 c/lb
Iron Ore(3) 58–62 Mt c.$37/t
Platinum Group Metals(4) 3.3–3.7 Moz c.$920/oz
Diamonds(5) 23-26 Mct c.$95/ct
Steelmaking Coal(6) 14-15.5 Mt c.$130-140/t
Nickel(7) 38–39 kt
(previously 36-38 kt)
c.530 c/lb
(previously c.550 c/lb)

(1) Unit costs exclude royalties and depreciation and include direct support costs only. 2024 unit cost guidance was set at: c.850 CLP:USD, c.3.7 PEN:USD, c.5.0 BRL:USD, c.19 ZAR:USD, c.1.5 AUD:USD.
(2) Copper business only. On a contained-metal basis. Total copper production is the sum of Chile and Peru: Chile: 430–460 kt and Peru: 300–330 kt. 2024 unit cost guidance for Chile: c.190 c/lb and Peru: c.110 c/lb. The copper unit costs are impacted by FX rates and pricing of by-products, such as molybdenum. Production in Chile is weighted to the first half of the year due to the planned closure of the Los Bronces plant at the end of July; production is also subject to water availability. Production in Peru is weighted to the second half of the year as a higher grade area of the mine is accessed.
(3) 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: 23–25 Mt. Kumba production is subject to third-party rail and port availability and performance. 2024 unit cost guidance for Kumba: c.$38/t and Minas-Rio: c.$35/t.
(4) 5E + gold produced metal in concentrate (M&C) ounces. Includes own mined production and purchased concentrate (POC) volumes. M&C production by source is expected to be own mined of 2.1–2.3 million ounces and purchase of concentrate of 1.2–1.4 million ounces. The average M&C split by metal is Platinum: c.45%, Palladium: c.35% and Other: c.20%. Refined production (5E + gold) is revised up to 3.7–3.9 million ounces (previously 3.3–3.7 million ounces) reflecting the benefit of no Eskom load-curtailment this year and good stability at the processing assets which has enabled a release of built-up work-in-progress inventory. Production remains subject to the impact of Eskom load-curtailment. Unit cost is per own mined 5E + gold PGMs metal in concentrate ounce.
(5) Production is on a 100% basis, except for the Gahcho Kué joint operation which is on an attributable 51% basis. As the midstream continues to hold higher than normal levels of inventory and the expectation for a recovery remains protracted, De Beers is actively assessing options with our partners to reduce production going forward. Unit cost is based on De Beers’ share of production.
(6) Production excludes thermal coal by-product. FOB unit cost comprises managed operations and excludes royalties. A planned longwall move at Moranbah is taking place during Q4 2024. A walk-on/walk-off longwall move at Aquila, that will have a minimal production impact, started initial commissioning in late Q3 and will occur during mid-Q4 2024.
(7) Nickel operations in Brazil only. The Group also produces approximately 20 kt of nickel on an annual basis from the PGM operations. Nickel production has been revised up reflecting strong operational performance and consequently, unit costs have been revised down.

Realised prices

  Q3 YTD 2024 Q3 YTD 2023 Q3 YTD 2024 vs. Q3 YTD 2023
Copper (USc/lb)(1) 421 387 9 %
Copper Chile (USc/lb)(2) 426 388 10 %
Copper Peru (USc/lb) 414 386 7 %
Iron Ore – FOB prices(3) 90 108 (17) %
Kumba Export (US$/wmt)(4) 94 110 (15) %
Minas-Rio (US$/wmt)(5) 85 106 (20) %
Platinum Group Metals
Platinum (US$/oz)(6) 959 981 (2) %
Palladium (US$/oz)(6) 1,013 1,437 (30) %
Rhodium (US$/oz)(6) 4,649 7,366 (37) %
Basket price (US$/PGM oz)(7) 1,455 1,766 (18) %
Diamonds
Consolidated average realised price (US$/ct)(8) 160 154 4 %
Average price index(9) 109 133 (18) %
Steelmaking Coal – HCC (US$/t)(10) 253 264 (4) %
Steelmaking Coal – PCI (US$/t)(10) 187 215 (13) %
Nickel (US$/lb)(11) 6.93 8.29 (16) %

(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) Average realised total iron ore price is a weighted average of the Kumba and Minas-Rio realised prices.
(4) 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 $96/t (Q3 YTD 2023: $112/t), higher than the dry 62% Fe benchmark price of $92/t (FOB South Africa, adjusted for freight).
(5) Average realised export basket price (FOB Açu) (wet basis as product is shipped with ~9% moisture).
(6) Realised price excludes trading.
(7) 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.
(8) Consolidated average realised price based on 100% selling value post-aggregation.
(9) Average of the De Beers price index for the Sights within the period. The De Beers price index is relative to 100 as at December 2006.
(10) Weighted average coal sales price achieved at managed operations. The average realised price for thermal coal by-product for Q3 YTD 2024, decreased by 24% to $118/t (Q3 YTD 2023: $156/t).
(11) Nickel realised price reflects the market discount for ferronickel (the product produced by the Nickel business).

Notes

  • This Production Report for the third quarter ended 30 September 2024 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 17 for information on forward-looking statements.

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For further information, please contact:

Media Investors
UK UK
James Wyatt-Tilby Tyler Broda
Email: [email protected] Email: [email protected]
Tel: +44 (0)20 7968 8759 Tel: +44 (0)20 7968 1470
Marcelo Esquivel Michelle West-Russell
Email: [email protected] Email: [email protected]
Tel: +44 (0)20 7968 8891 Tel: +44 (0)20 7968 1494
Rebecca Meeson-Frizelle Asanda Malimba
Email: [email protected] Email: [email protected]
Tel: +44 (0)20 7968 1374 Tel: +44 (0)20 7968 8480
South Africa
Nevashnee Naicker
Email: [email protected]
Tel: +27 (0)11 638 3189

Notes to editors:

Anglo American is a leading global mining company focused on the responsible production of copper, premium iron ore and crop nutrients – future-enabling products that are essential for decarbonising the global economy, improving living standards, and food security. Our portfolio of world-class operations and outstanding resource endowments offers value-accretive growth potential across all three businesses, positioning us to deliver into structurally attractive major demand growth trends.

Our integrated approach to sustainability and innovation drives our decision-making across the value chain, from how we discover new resources to how we mine, process, move and market our products to our customers – safely, efficiently and responsibly. Our Sustainable Mining Plan commits us to a series of stretching goals over different time horizons to ensure we contribute to a healthy environment, create thriving communities and build trust as a corporate leader. We work together with our business partners and diverse stakeholders to unlock enduring value from precious natural resources for our shareholders, for the benefit of the communities and countries in which we operate, and for society as a whole. Anglo American is re-imagining mining to improve people’s lives.

Anglo American is currently implementing a number of major structural changes to unlock the inherent value in its portfolio and thereby accelerate delivery of its strategic priorities of Operational excellence, Portfolio simplification, and Growth. This portfolio transformation will focus Anglo American on its world-class resource asset base in copper, premium iron ore and crop nutrients, once the sale of our steelmaking coal and nickel businesses, the demerger of our PGMs business (Anglo American Platinum), and the separation of our iconic diamond business (De Beers) have been completed.

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 document, 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 product 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 document. 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 Guidance 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 document 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 document 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.

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