SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
For the month of June 2003.
ASHANTI GOLDFIELDS COMPANY LIMITED
(Translation of Registrant's Name Into English)
Gold House, Patrice Lumumba Road
Roman Ridge, P.O. Box 2665
Accra, Ghana
(Address of Principal Executive Offices)
(Indicate by check mark whether the registrant files or will file
annual reports under cover of Form 20-F or Form 40-F.)
Form 20-F X Form 40-F___
(Indicate by check mark whether the registrant by furnishing the
information contained in this form is also thereby furnishing the information to
the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of
1934.)
Yes ___ No X
(If "Yes" is marked, indicate below the file number assigned to the
registrant in connection with Rule 12g3-2(b): 82-_____.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Date: June 17, 2003 ASHANTI GOLDFIELDS COMPANY LIMITED
By: /s/ Ernest Abankroh
---------------------
Name: Ernest Abankroh
Title: Company Secretary
[ASHANTI GOLDFIELDS LOGO]
P R E S S R E L E A S E
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FOR IMMEDIATE RELEASE 17 JUNE 2003
FIRST QUARTER REPORT 2003
EARNINGS IMPACTED BY LOWER PRODUCTION AND HIGHER CASH OPERATING COSTS
Overview
First quarter production of 380,929 ounces was 7% lower than last year's
409,384 ounces primarily due to a delay in commissioning of the plant expansion
at Iduapriem/Teberebie, lower mined grades as waste stripping to access higher
grade ore continued at Geita and lower grades and recovery at Obuasi and
Bibiani.
Total cash operating costs rose from US$190 per ounce to US$224 per ounce. This
was as a result of lower gold production, the impact of fuel prices, one off
costs associated with the clean up of the Bibiani pit wall slip, lower grades
during the period of the Geita Nyankanga pit cut-back and interim crushing and
mill feed arrangements at Iduapriem which necessitated a higher than normal
amount of ore re-handling.
Earnings for the quarter of US$6.8 million were 59% lower than the US$16.5
million recorded in 2002. Earnings per share were US$0.05 (2002: US$0.15). The
reduced earnings were due to lower production and higher cash operating costs,
partially mitigated by higher spot prices. The realised gold price of US$338 per
ounce was lower than the average spot price of US$351 per ounce, due to
commitments in the Ashanti and Geita hedge books.
Group gross and net debt levels were broadly unchanged during the quarter at
US$255.9 million and US$215.0 million respectively.
Higher spot prices and gold volatility helped Ashanti to effect some
restructurings to its hedge book during the quarter. These restructurings have
improved the average committed price per ounce over the life of the Ashanti
hedge book by US$11, from US$346 to US$357.
Drilling at Obuasi below 50 Level continued to yield encouraging results with
significant drill intercepts of principally quartz, with visible gold. These
intercepts included 11.1 metres at 30.1g/t; 7.4 metres at 29.8g/t and 5.8 metres
at 32.4g/t respectively between 54 level and 59 level.
o Quarter's earnings of US$6.8 million, 59% lower than first quarter of 2002
o Total gold production of 380,929 ounces, 7% lower than last year
o Cash operating cost of US$224 per ounce, up US$34 per ounce on last year
o Ashanti hedge book restructured further
o Exploration at Obuasi and Geita continues to yield encouraging results
3 months to 3 months to 12 months to
HIGHLIGHTS 31 Mar 03 31 Mar 02 31 Dec 02
--------------------------------------------------------------------------------
FINANCIAL (US$m)
Total turnover 128.9 136.9 552.2
Total EBITDA 31.3 47.4 162.7
Operating Profit 11.7 24.3 74.3
Profit before tax 7.0 18.3 51.7
Earnings 6.8 16.5 56.2
Earnings per share (US$) 0.05 0.15 0.47
--------------------------------------------------------------------------------
GOLD PRODUCTION (ounces)
--------------------------------------------------------------------------------
Total 380,929 409,384 1,621,919
Attributable 363,341 391,836 1,553,745
--------------------------------------------------------------------------------
GOLD PRICE (US$ per ounce)
--------------------------------------------------------------------------------
Realised by Ashanti 338 334 340
Spot price 351 301 312
--------------------------------------------------------------------------------
TOTAL PRODUCTION COSTS BEFORE EXCEPTIONAL ITEMS (US$ per ounce)
--------------------------------------------------------------------------------
Cash operating costs 224 190 199
Royalties 11 8 9
Depreciation and amoritisation 51 56 54
--------------------------------------------------------------------------------
Total 286 254 262
--------------------------------------------------------------------------------
OPERATIONS REVIEW [ASHANTI LOGO]
GHANA
OBUASI
Obuasi's gold production for the quarter was 131,918 ounces approximately 2,000
ounces ahead of target, but 8,178 ounces below the 140,096 ounces achieved in
the first quarter of 2002. The decrease in production was due to the lower feed
grade, 6.99 g/t compared to 8.01 g/t, and lower metallurgical recovery, 84.6%
compared to 87.0%, at the Sulphide Treatment Plant (STP). At US$205 per ounce,
the cash operating cost for the quarter was on target but represented an 8%
increase on the US$189 per ounce achieved in the first quarter of 2002.
Mining. Underground production of 583,000 tonnes was lower than the 591,000
tonnes reported in the first quarter of 2002 while the head grade at 7.05 g/t is
a decrease on the 7.50 g/t reported for the same prior period. The reduction in
grade was expected with a higher tonnage mined from the lower grade bulk mining
open stopes scheduled for the period. The tonnage reduction was due to lower
than plan mining fleet equipment availability in February. During the quarter
further initiatives were undertaken to enhance grade control procedures and to
upgrade the mine and processing plant feed tonnage/grade reconciliation systems.
Underground infrastructure. Development continued on 50 level BSVS shaft whilst
procurement of the steelwork was progressed in preparation for equipping, which
is scheduled to commence in the fourth quarter. Raiseboring of the 300
ventilation shaft was completed and civil work for conventional sinking of the
collar area commenced.
Surface Mining. Open pit production from the Homase deposit was 172,000 tonnes
grading 2.65 g/t during the quarter. The ore was trucked to the Oxide Treatment
Plant (OTP) at Obuasi and blended with reclaimed heap leach tailings.
Processing. Throughput at STP was 580,000 tonnes, similar to the 582,000 tonnes
treated in the corresponding period of last year. The head grade decreased to
6.99 g/t from 8.01 g/t and recovery decreased to 84.6% from 87.0%. This resulted
in gold production being 110,235 ounces compared to 130,246 ounces in the first
quarter of 2002. Plant throughput was affected by a damaged mill pinion on the
SAG mill which necessitated operating the mill at a reduced feed rate. The mill
pinion will be changed and the girth gear turned at the end of the second
quarter. An additional SAG mill which was relocated to STP from Pompora
Treatment Plant (PTP) was successfully re-commissioned during the first quarter
and will provide security of capacity and production flexibility. Gold
production at OTP was 10,997 ounces. The Tailings Treatment Plant produced
10,686 ounces in the first quarter compared to 9,496 ounces for the
corresponding period in 2002. Tailings throughput increased to 500,000 tonnes
compared with the previous year's 440,000 tonnes and recovery increased to 31%
from 30%.
Exploration. Underground exploration yielded good results with three
intersections from the 131 crosscut on 50 level: 30.1 g/t over 11.0 metres, 29.8
g/t over 7.4 metres and 32.4 g/t over 5.8 metres at 54 level, 57 level and 59
level horizons respectively. In the south section of the mine drilling from 41
level provided 13.6 g/t over 6.4 metres and from 38 level intersections included
23.5 g/t over 9.4 metres and 26.0 g/t over 6.0 metres. In the north of the mine
an intersection from 12 level was made on a previously undeveloped shoot on the
Ashanti reef showing 98.0 g/t over 4.7 metres. Surface drilling of the north
extension of mineralisation at the Homase deposit was completed and the resource
model is currently being finalised.
IDUAPRIEM/TEBEREBIE
First quarter gold production at Iduapriem was 47,246 ounces, slightly below the
47,844 ounces produced in the first quarter last year. The mill and leach tank
component of the Carbon-in-Leach (CIL) plant expansion was largely completed
during the quarter with outstanding work relating to new carbon screens.
Integrating the new mill, classification and leach tank circuits with the
original plant and balancing the circuits to provide optimum recovery provided a
series of unanticipated challenges resulting in metallurgical recovery for the
quarter being below expectation. Progress is being made in these areas and
completion testing is ongoing. The overland conveyor and primary crushing
section of the upgrade will be commissioned in two phases during the second and
third quarters respectively. The cash operating costs were US$260 per ounce
compared to US$193 per ounce for the corresponding quarter last year. The high
cost reflects the higher tonnage milled and the low recovery achieved during the
period as well as high ore re-handle costs associated with the temporary
crushing and mill feed arrangements being utilised whilst the overland conveyor
and primary crusher elements of the upgrade project are being implemented.
Relative to the same quarter last year, gold production from the heap leach
operation reduced from 9,553 ounces to 6,459 ounces because of lower recovery
associated with harder less permeable feed material and lower tonnage
throughput.
BIBIANI
Bibiani produced 51,271 ounces at a cash operating cost of US$234 per ounce from
processing 610,000 tonnes of ore at 3.35 g/t. Production for the corresponding
period in 2002 was 59,806 ounces at US$186 per ounce from 577,000 tonnes at 3.90
g/t. Metallurgical recovery reduced to 80.3% from 82.2% relative to the first
quarter of 2002 due to the more refractory nature of the ores being processed.
The lower grade and metallurgical recovery resulted in the lower gold
production.
The increase in the cash operating cost reflects the lower gold production, the
increased depth of the pit and the clean up work on the footwall slip which
occurred in October 2002.
Good progress was made on the underground decline access and the portal has now
been fully established for accelerated development and exploration activities.
The first deep
2 Ashanti Goldfields, First Quarter 2003
OPERATIONS REVIEW [ASHANTI LOGO]
exploration hole, drilled to a depth of 1,060 metres, intersected the shear
zone but mineralisation was low grade, 1.9 metres at 1.8 g/t. The second hole
was at 800 metres depth at the end of the quarter. These holes are targeted to
intersect the mineralised zone at depths well below the deepest underground
workings.
Recent metallurgical test work aimed at improving recovery from the refractory
component of the ore has indicated that a flotation process with concentrate
regrind and intense cyanide leaching will enhance the economics of processing
these ores. The possibility of utilising redundant plant from the Obuasi PTP
for this purpose is being investigated.
GUINEA
SIGUIRI (85% OWNED)
Siguiri gold production of 70,011 ounces was similar to the 69,142 ounces
achieved in the first quarter of 2002. Stacked tonnage increased to 2.48
million tonnes from 2.39 million tonnes whilst the feed grade declined to 1.16
g/t from 1.23 g/t. Low excavator availability affected mining operations
resulting in a loss of production flexibility and access to higher grade
material scheduled for mining. A fire which started in the ventilation system
caused extensive damage to the assay control operations in the pits and the
ability to mine at planned grades during the quarter. The laboratory has been
repaired and was back to full capacity by the end of April. The cash operating
costs increased to US$239 per ounce form US%228 per ounce, reflecting increased
mined volumes and higher fuel prices.
Engineering design, procurement, site mobilisation and civil preparation work
for the new CIP plant progressed throughout the first quarter. However, Ashanti
has, by mutual agreement with the contractor, terminated the Siguiri CIP lump
sum contract due to irreconcilable differences. Ashanti is reviewing the
situation and assessing alternative options, which will impact on project
timetable and costs.
ZIMBABWE
FREDA-REBECCA
Freda-Rebecca gold production for the quarter was 16,945 ounces compared with
23,086 ounces in the first quarter of 2002. Despite an increase in mill
throughput to 344,000 tonnes form 283,000 tonnes, gold production decreased
because of the lower feed grade and metallurgical recovery. Blasthold drilling
operations were impacted by a lack of foreign exchange to procure drill spares
resulting in low underground ore production and the need to feed the pant with
a high tonnage of low grade surface stockpile material. Alternative supply
positions are being investigated and a plan has been drawn up to replenish the
drilled reserve during the second quarter During this period the shortfall in
underground production tonnage will be replaced by low grade open pit ore and
further draw down of the medium/low grade surface stockpiles. Negotiations with
the central bank and suppliers have taken place but the release of hard
currency is slow and could impact in the production recovery plan. the lower
gold production and inflationary pressures in Zimbabwe are reflected in the
increase in cash operating costs for the quarter to US$266 per ounce form
US$226 per ounce for the same period last year.
TANZANIA
GEITA (50% OWNED)
Gold production at Geita was 127,077 ounces compared with 138,819 ounces
produced in the first quarter of 2002. Plant throughput for the quarter was 1.4
million tonnes at 3.10 g/t compared to 1.2 million at 4.00 g/t for the
corresponding period last year. Mining activities were concentrated on the
Nyankanga cut 3 waste strip in order to access higher grade ore early in the
third quarter. The upgrade of the crushing circuit was successfully
commissioned during the first quarter and initial results indicate that the
targeted upgrade milling capacity of 5.5 million tonnes per year will be
achieved. Cash operating costs rose US$203 per ounce from US$146 per ounce
largely as a result of lower grades and production.
Summary of production and cash operating costs per ounce.
FREDA- TOTAL/
OBUASI IDUAPRIEM BIBIANI SIGUIRI REBECCA GEITA AVERAGE
____________________________________________________________________________________________________________________________________
3 months to 31 March 2003
Production (ounces) 131,918 47,246 51,271 70,011 16,945 63,538 380,929
Cost per ounce (US$) 205 260 234 239 266 203 224
____________________________________________________________________________________________________________________________________
3 months to 31 March 2002
Production (ounces) 140,096 47,844 59,806 69,142 23,086 69,410 409,384
Cost per ounce (US$) 189 193 186 228 226 146 190
____________________________________________________________________________________________________________________________________
12 months to 31 December 2002
Production (ounces) 537,219 185,199 242,432 269,292 99,255 289,522 1,621,919
Cost per ounce (US$) 198 232 180 230 214 163 199
____________________________________________________________________________________________________________________________________
ASHANTI GOLDFIELDS, FIRST QUARTER 2003 3
ASHANTI LETTERHEAD
OPERATIONS REVIEW
OUTLOOK
As announced on 26 March 2003, Ashanti anticipates its second quarter production
to be in the region of 375,000 ounces. This is due to the delay in commissioning
the expansion at Iduapriem/Teberebie and the ongoing Nyankanga pit cut-back at
Geita. Damage to the SAG mill pinion at Obuasi, lower mined and stacked grades
at Siguiri and power outages in Ghana could further impact production during the
second quarter. Following completion of the Nyankanga pit cut-back at Geita,
replacement of the damaged mill pinion at Obuasi, both anticipated in July, and
commissioning of the second phase of the crusher and overland conveyor component
of the Iduapriem/Teberebie expansion towards the end of the third quarter,
production levels are planned to increase during the second half of the year in
order to meet the 2003 production target of approximately 1.6 million ounces.
As also announced on 26 March 2003, rising fuel prices, increases in power cost
and wages, depreciation of the US dollar in which our revenues are denominated,
the appreciation in currencies of countries from which we source our major
inputs and rising costs of reagents will impact adversely on our cash operating
costs this year. We are taking steps to minimise this impact but it is still
likely that cash operating costs will increase by approximately 10% this year.
The reduced production level anticipated for the second quarter will also have a
consequential adverse impact on our unit cash operating costs for the second
quarter as compared to the annualised level.
EXPLORATION
EAST AFRICA
TANZANIA
GEITA
During the quarter exploration drilling continued at Nyankanga West and East,
Star and Comet and at Geita Hill. At Nyankanga, step out drilling testing strike
and depth extensions both east and west of the current resource continued. A
high grade intersection of 20 metres grading 15.3 g/t was intersected in
borehole NYDD0097 at 190 metres, some 300 metres west along strike from the main
Nyankanga ore body. At Star and Comet, hole SCDD002, one of two holes drilled
targeting the projected high grade fold nose mineralisation at depth,
intersected 9 metres grading 19.5 g/t from 267 metres down the hole.
TANZANIA REGIONAL
Stream sediment sampling continued on the Kigosi reconnaissance licence in the
south western part of the Lake Victoria Goldfields.
D.R.CONGO
Continued unrest in the Mongbwalu area precluded the commencement of exploration
activities during the quarter on the Kilo gold project. It is hoped the
stationing of United Nations personnel and the withdrawal of Ugandan and
Rwandese troops will bring stability to the area.
WEST AFRICA
BURKINO FASO
The Youga Exploitation Permit was ratified by the Government on 8 April 2003.
COTE D'IVOIRE
Some progress was made towards resolving the stalemate between the Government
and rebel forces during the quarter but no resumption of exploration activities
was undertaken.
GUINEA
Exploration drilling, concentrated on the area surrounding the Bidini, Eureka
Hill, Sanu Tinti and Tubani pits, defined several small resources in both
laterite and saprolite. Several intersections from the Kalamagna Prospect,
including 57 metres grading 1.21 g/t from surface, 34 metres at 1.56 g/t from 27
metres and 16 metres of 2.06 g/t from 52 metres were made during the quarter.
MALI
Broad spaced reconnaissance pits were used to test the regolith profile in the
M'pebougoula JV Exploration Authorisation that abuts the southern limit of the
Morila Exploitation Permit. Auger drilling and geophysical surveying of these
areas is in progress. Similar work as commenced on the Bala and Ngolopene
Authorisations north of the inactive Syama Mine.
Initial pits dug in the Koumantou Exploration Authorisation suggest that only
the eastern portion of permit is prospective for gold. Geochemical sampling and
mapping is in progress.
SOUTHERN AFRICA
SOUTH AFRICA
Application for the prospecting licence on the M'phatlele's Location PGM project
was submitted during the quarter.
4 Ashanti Goldfields, First Quarter 2003
PRODUCTION [ASHANTI LOGO]
3 months to 3 months to 12 months to
31 March 2003 31 March 2002 31 Dec 2002
------------- ------------- ------------
Obuasi
Underground Mining
Ore ('000 tonnes)............................ 583 591 2,423
Grade (g/t).................................. 7.05 7.50 7.48
------------- ------------- ------------
SURFACE MINING
Ore ('000 tonnes)............................ 172 -- 368
Grade (g/t).................................. 2.65 -- 2.71
Waste Mined ('000 tonnes).................... 872 -- 2,165
Strip Ratio.................................. 5.1 -- 5.8
------------- ------------- ------------
SULPHIDE TREATMENT PLANT
Ore processed ('000 tonnes).................. 580 582 2,352
Head grade (g/t)............................. 6.99 8.01 7.35
Recovery (%)................................. 84.6 87.0 84.8
Gold produced (ounces)....................... 110,235 130,426 471,359
------------- ------------- ------------
POMPORA TREATMENT PLANT CLEAN UP
Gold produced (ounces)....................... -- 174 195
------------- ------------- ------------
OXIDE TREATMENT PLANT
Ore Processed ('000 tonnes).................. 228 -- 435
Head grade (g/t)............................. 1.80 -- 2.06
Recovery (%)................................. 81.8 -- 81.2
Gold produced (ounces)....................... 10,997 -- 23,390
------------- ------------- ------------
TAILINGS TREATMENT PLANT
Ore processed ('000 tonnes).................. 500 440 1,840
Head grade (g/t)............................. 2.15 2.23 2.29
Recovery (%)................................. 31.0 30.0 31.2
Gold produced (ounces)....................... 10,686 9,496 42,275
------------- ------------- ------------
OBUASI TOTAL PROCESSED
Ore processed ('000 tonnes)................. 1,309 1,022 4,627
Head grade (g/t)............................ 4.24 5.52 4.48
Recovery (%)................................ 74.1 77.2 74.8
Gold produced (ounces)...................... 131,918 140,096 537,219
------------- ------------- ------------
DISTRIBUTION OF OBUASI PRODUCTION (OUNCES)
Obuasi underground.......................... 110,235 130,600 471,554
Obuasi surface.............................. 10,997 -- 23,390
Obuasi tailings............................. 10,686 9,496 42,275
Obuasi Total................................ 131,918 140,096 537,219
------------- ------------- ------------
Iduapriem
MINING
Ore ('000 tonnes)........................... 886 940 4,393
Grade (g/t)................................. 1.74 1.60 1.66
Waste mined ('000 tonnes)................... 3,474 4,128 15,019
Strip ratio................................. 3.9 4.5 3.4
------------- ------------- ------------
CIL PLANT
Ore processed ('000 tonnes)................. 844 656 2,625
Head grade (g/t)............................ 1.69 2.00 1.96
Recovery (%)................................ 89.4 94.4 89.3
Gold produced (ounces)...................... 40,787 38,291 147,726
------------- ------------- ------------
HEAP LEACH
Ore stacked ('000 tonnes)................... 306 355 1,127
Head grade (g/t)............................ 1.14 1.10 1.13
Recovery (%)................................ 57.9 76.1 91.3
Gold produced (ounces)...................... 6,459 9,553 37,473
Total Gold Produced (ounces)................ 47,246 47,844 185,199
------------- ------------- ------------
Ashanti Goldfields, First Quarter 2003 5
PRODUCTION [ASHANTI LOGO]
3 Months to 3 Months to 12 Months to
31 March 2003 31 March 2002 31 Dec 2002
--------------------------------------------------------------------------------------------------
BIBIANI
MINING
Ore ('000 tonnes) 661 344 2,608
Grade (g/t) 3.51 3.70 3.53
Waste mined ('000 tonnes) 2,128 3,004 11,054
Strip ratio 3.2 8.7 4.2
--------------------------------------------------------------------------------------------------
CIL PLANT
Ore processed ('000 tonnes) 610 577 2,566
Head grade (g/t) 3.35 3.90 3.72
Recovery (%) 80.3 82.2 79.0
Gold produced (ounces) 51,271 59,806 242,432
--------------------------------------------------------------------------------------------------
SIGUIRI
MINING
Ore ('000 tonnes) 2,533 1,913 9,464
Grade (g/t) 1.16 1.23 1.19
Waste mined ('000 tonnes) 2,277 2,230 8,404
Strip ratio 0.9 1.2 0.9
--------------------------------------------------------------------------------------------------
HEAP LEACH
Ore stacked ('000 tonnes) 2,476 2,390 9,462
Head grade (g/t) 1.07 1.16 1.16
Recovery (%) 82.2 77.5 76.3
Gold produced (ounces) 70,011 69,142 269,292
--------------------------------------------------------------------------------------------------
FREDA-REBECCA
UNDERGROUND MINING
Ore ('000 tonnes) 168 262 1,077
Grade (g/t) 2.61 3.83 2.99
--------------------------------------------------------------------------------------------------
SURFACE MINING
Ore ('000 tonnes) 18 44 110
Grade (g/t) 1.9 2.19 2.26
--------------------------------------------------------------------------------------------------
CIL PLANT
Ore processed ('000 tonnes) 344 283 1,155
Head grade (g/t) 1.92 3.36 3.22
Recovery (%) 79.7 75.6 82.2
Gold produced (ounces) 16,945 23,086 98,255
--------------------------------------------------------------------------------------------------
GEITA
MINING
Ore ('000 tonnes) 1,037 1,192 5,399
Grade (g/t) 3.03 3.30 3.52
Waste mined ('000 tonnes) 11,426 5,550 39,729
Strip ratio 11.0 4.7 7.4
--------------------------------------------------------------------------------------------------
CIL PLANT
Ore processed ('000 tonnes) 1,397 1,198 4,979
Head grade (g/t) 3.10 4.00 3.92
Recovery (%) 92.0 92.1 92.3
Gold produced (ounces) 127,077 138,819 579,043
Ashanti's 50% share (ounces) 63,538 69,410 289,522
--------------------------------------------------------------------------------------------------
GROUP SUMMARY (OUNCES)
Managed gold production 317,391 339,974 1,332,397
Geita JV 50% 63,538 69,410 289,522
Total production 380,929 409,384 1,621,919
Less minority interests 17,589 17,548 68,174
--------------------------------------------------------------------------------------------------
Total Attributable (ounces) 363,341 391,836 1,553,745
--------------------------------------------------------------------------------------------------
6 Ashanti Goldfields, First Quarter 2003
FINANCIAL REVIEW [ASHANTI LOGO]
Earnings
Earnings for the first quarter were US$6.8 million, down US$9.7 million
on the corresponding period last year. The reduction in earnings was due to
lower production and higher cash operating costs offset partially by higher spot
prices. Earnings per share were US$0.05 (2002: US$0.15).
Revenue
Gold production for the quarter of 380,929 ounces (2002: 409,384 ounces)
generated spot revenue of US$133.6 million (2002: US$123.4 million), equivalent
to US$351 per ounce (2002: US$301 per ounce). Total hedging income for the
quarter was negative US$4.7 million, comprising deferred hedging income of
US$3.2 million and net cash payments on maturing hedging contracts, due to the
high spot prices during the quarter, of US$7.9 million. Total revenue for the
quarter was US$128.9 million (2002: US$136.9 million), equivalent to US$338 per
ounce (2002: US$334 per ounce).
Hedging
Higher spot prices and gold volatility levels since 31 December 2002 allowed
Ashanti to make the following principal changes to its hedge book during the
quarter:
- 660,000 ounces of bought call options with strike prices greater than US$430
per ounce were re-struck lower to 232,652 ounces of bought call options with
strike prices of US$320 per ounce and US$330 per ounce;
- Protected ounces were increased by 50,400 with strike prices of US$354 per
ounce and US$375 per ounce; and
- 401,000 ounces of sold call options were re-struck lower to match 682,400
ounces of bought put options, thereby converting the put and call options
into forward sales. Value generated through this restructure was used to
purchase a further 232,666 ounces of call options with a strike price of
US$330 per ounce.
Although the total number of bought call ounces has been reduced, the above
restructurings have the following advantages:
- Owing to the lower strike prices, the cashflow effect from the new bought
call structure is comparably beneficial to Ashanti up to gold prices of
approximately US$500 per ounce with respect to these contracts;
- The bought call options now have strike prices and value dates that match
individual sold call options or forward sales;
- Converting bought put and sold call options into forward sales simplifies the
management of the hedge book;
- The number of protected ounces has increased by 50,400 at favourable strike
prices;
- The average committed price over the life of the book has improved by US$11
per ounce from US$346 per ounce to US$357 per ounce; and
- Commitments for 2003 have been reduced allowing more participation in higher
spot prices: as at 31 March 2003 commitments stood at 879,072 ounces, which
is a reduction of 420,582 ounces (32%) as compared to the position as at 31
December 2002 of 1,299,654 ounces.
There were no significant changes to lease rate swap ounces or the Geita hedge
book, apart from maturing contracts.
At the quarter end Ashanti had 4.8 million ounces of protection at an average
price of US$359 per ounce with commitments of 6.6 million ounces. The
mark-to-market valuation of the hedge book at quarter end was negative US$93.2
million based on a spot price of US$336 per ounce. Ashanti's share of the
mark-to-market valuation of the Geita hedge book was negative US$36.3 million.
Cash Operating Costs
Total cash operating costs rose from US$190 to US$224 per ounce. This was as a
result of lower gold production, the impact of increased fuel prices, one off
costs associated with the clean up of the Bibiani pit wall slip, the Geita
Nyankanga pit cut-back and interim crushing and mill feed arrangements at
Iduapriem which necessitated a higher than normal amount of ore re-handling.
Profit
Operating profit for the quarter, including Geita, was US$11.7 million (2002:
US$24.3 million). Exploration expenditure was US$0.3 million lower than last
year at US$0.7 million while corporate administration costs were up US$1.4
million on last year at US$6.0 million. Depreciation at US$19.6 million was
down from US$23.1 million last year due to lower production.
Net interest payable for the quarter was US$4.7 million, down US$1.3 million on
last year due to lower debt levels and interest rates.
Cash Flows and Balance Sheet
Cash inflow from operating activities was US$16.8 million (2002: US$23.2
million). Net interest payments were US$2.4 million, US$5.6 million lower than
last year. Capital expenditure was US$17.1 million (2002: US$14.9 million) and
includes expenditure of US$7.7 million at Obuasi, US$4.8 million in respect of
the CIP project at Siguiri and US$2.5 million on the plant expansion at
Iduapriem/Teberebie.
A further US$3.6 million was raised from the exercise of warrants. Of the total
19,835,001 warrants issued in January 2000, 15,155,031 warrants have been
exercised and 4,679,970 warrants remained outstanding as at 31 March 2003.
Gross and net debt at quarter end were US$255.9 million and US$215.0 million
respectively, broadly unchanged from previous year end.
Other Matters subsequent to 31 March 2003
The boards of Ashanti and AngloGold Limited ("AngloGold") are in discussions
regarding a proposed merger of the two companies at a ratio of 26 AngloGold
shares for every 100 Ashanti ordinary shares or global depositary securities.
These discussions and the related discussions with certain stakeholders may or
may not lead to a proposal being made for the entire issued share capital of
Ashanti. As Ashanti announced on 13 June 2003, the Government of Ghana is to
hold consultations and take appropriate professional advice in considering the
proposed merger. In view of these discussions, the proposed rights issue has
been delayed. If the proposed merger is formally announced, it is not Ashanti's
intention to proceed with the rights issue.
On 30 May 2003 a further 2,183,144 warrants were exercised at US$3 per warrant
raising US$6.5 million. As a result the stated capital now stands at 130.8
million shares (31 December 2002: 127.5 million shares) and 2.5 million
warrants remain outstanding.
Ashanti Goldfields, First Quarter 2003
7
[ASHANTI LOGO]
GROUP PROFIT AND LOSS ACCOUNT
Unaudited
3 months to 31 Mar 2003 3 months to 31 Mar 2002 12 months to
Interest in Interest in 31 Dec 2002
Group joint venture Total Group joint venture Total Total
Note US$m US$m US$m US$m US$m US$m US$m
-----------------------------------------------------------------------------------------------------------------------------------
TURNOVER 2 109.6 19.3 128.9 116.9 20.0 136.9 552.2
------ ----- ------ ----- ----- ------ ------
Cash operating costs 2 (72.5) (12.9) (85.4) (67.8) (10.1) (77.9) (323.1)
Other costs (7.4) (0.8) (8.2) (6.4) (0.8) (7.2) (31.6)
Exceptional cost -- -- -- (1.0) -- (1.0) (32.3)
Royalties (3.4) (0.6) (4.0) (2.8) (0.6) (3.4) (14.6)
Depreciation and amortisation (17.3) (2.3) (19.6) (20.0) (3.1) (23.1) (88.4)
------ ----- ------ ----- ----- ------ ------
TOTAL COSTS 3 (100.6) (16.6) (117.2) (98.0) (14.6) (112.6) (490.0)
------ ----- ------ ----- ----- ------ ------
Other income -- -- -- -- -- -- 12.1
OPERATING PROFIT 2 9.0 2.7 11.7 18.9 5.4 24.3 62.2
===== ====== ===== ======
Share of operating profit of joint venture 2.7 5.4 --
------ ----- ------
TOTAL OPERATING PROFIT 11.7 24.3 74.3
NET INTEREST PAYABLE: group (3.6) (4.9) (17.5)
joint venture (1.1) (1.1) (5.1)
------ ----- ------
PROFIT BEFORE TAXATION 7.0 18.3 51.7
Taxation: group -- (1.8) (3.0)
joint venture -- -- 6.7
------ ----- ------
PROFIT AFTER TAXATION 7.0 16.5 55.4
Minority interests (0.2) -- 0.8
------ ----- ------
PROFIT ATTRIBUTABLE TO SHAREHOLDERS 6.8 16.5 56.2
Dividends -- -- --
------ ----- ------
RETAINED PROFIT FOR THE PERIOD 6.8 16.5 56.2
====== ===== ======
EARNINGS PER SHARE (US$) 0.05 0.15 0.47
====== ===== ======
8 Ashanti Goldfish, First Quarter 2003
GROUP BALANCE SHEET [ASHANTI LOGO]
Unaudited
AS AT 31 MAR 2003 AS AT AS AT
INTEREST IN 31 MAR 2002 31 DEC 2002
GROUP JOINT VENTURE TOTAL GROUP GROUP
US$m US$m US$m US$m US$m
------------------------------------------------------------------------------------------------------------------------------------
FIXED ASSETS
Intangible assets 16.0 54.0 74.0 18.0 17.3
Tangible assets 598.3 106.0 704.3 607.8 602.7
Investments
-Geita joint venture 92.8 (92.8) - 86.2 91.2
-Loans to joint venture and
other investments 32.3 - 32.3 32.6 32.6
------- -------- ------- -------
739.4 806.6 744.6 743.8
------- -------- ------- -------
CURRENT ASSETS
Stocks 73.7 10.0 83.7 71.6 76.6
Debtors due within one year 10.7 21.6 32.3 19.8 14.0
Debtors due after more than
one year 12.4 - 12.4 - 8.8
Cash 40.9 14.4 55.3 42.9 41.3
------- ------ -------- ------- -------
137.7 46.0 183.7 134.3 140.7
------- ------ -------- ------- -------
CREDITORS: AMOUNTS FALLING DUE
WITHIN ONE YEAR
Creditors (123.2) (18.8) (142.0) (137.5) (131.1)
Borrowings (2.3) (10.8) (13.1) (279.8) (2.7)
------- ------ -------- ------- -------
(125.5) (29.6) (155.1) (417.3) (133.8)
------- ------ -------- ------- -------
NET CURRENT ASSETS/(LIABILITIES) 12.2 16.4 28.6 (283.0) 6.9
TOTAL ASSETS LESS CURRENT
LIABILITIES 751.6 835.2 461.6 750.7
CREDITORS: AMOUNTS FALLING DUE
AFTER MORE THAN ONE YEAR
Creditors (15.0) (39.9) (54.9) (50.4) (24.0)
Borrowings (253.6) (40.6) (294.2) (34.3) (254.2)
Provisions for liabilities
and charges (24.9) (3.1) (28.0) (20.1) (25.0)
------- -------- ------- -------
458.1 458.1 356.8 447.5
======= ======== ======= =======
CAPITAL AND RESERVES
Stated capital 591.8 545.2 588.2
Reserves (135.1) (190.4) (141.9)
------- ------- -------
EQUITY SHAREHOLDERS' FUNDS 456.7 354.8 446.3
Equity minority interests 1.4 2.0 1.2
------- ------- -------
458.1 356.8 447.5
======= ======= =======
Ashanti Goldfields, First Quarter 2003 9
GROUP CASH FLOW STATEMENT [ASHANTI LOGO]
Unaudited
3 months to 3 months to 12 months to
31 Mar 2003 31 Mar 2002 31 Dec 2002
US$m US$m US$m
--------------------------------------------------------------------------------------------------------------------------
Cash inflow from operating activities 16.8 23.2 95.2
--------------------------------------------------------------------------------------------------------------------------
Returns on investments and servicing of finance
Interest received 0.1 0.1 0.8
Interest paid (2.5) (8.1) (19.6)
--------------------------------------------------------------------------------------------------------------------------
Net cash outflow from returns on investments and service of finance (2.4) (8.0) (18.8)
--------------------------------------------------------------------------------------------------------------------------
Taxation
Corporate tax paid - (0.6) (2.0)
--------------------------------------------------------------------------------------------------------------------------
Capital expenditure and financial investments
Purchase of tangible fixed assets (17.1) (14.9) (64.5)
--------------------------------------------------------------------------------------------------------------------------
Net cash outflow from capital expenditure and financial investment (17.1) (14.9) (64.5)
--------------------------------------------------------------------------------------------------------------------------
Cash (outflow)/inflow before use of liquid resources and financing (2.7) (0.3) 9.9
Management of liquid resources 6.0 6.7 6.0
--------------------------------------------------------------------------------------------------------------------------
Cash inflow before financing 3.3 6.4 15.9
Financing
Loans drawn down - - 265.0
Loan repayments (0.9) (9.6) (326.0)
Issue of shares 3.6 - 41.8
--------------------------------------------------------------------------------------------------------------------------
Net cash inflow/(outflow) from financing 2.7 (9.6) (19.2)
--------------------------------------------------------------------------------------------------------------------------
Increase/(decrease) in cash 6.0 (3.2) (3.3)
--------------------------------------------------------------------------------------------------------------------------
Reconciliation of net cash flow to movement in net debt
Increase/(decrease) in cash 6.0 (3.2) (3.3)
Decrease in liquid resources (6.0) (6.7) (6.0)
--------------------------------------------------------------------------------------------------------------------------
- (9.9) (9.3)
Cash outflow from decrease in debt 0.9 9.6 61.0
Other (0.3) (0.2) 3.4
--------------------------------------------------------------------------------------------------------------------------
Movement in net debt 0.6 (0.5) 55.1
Net debt at beginning of period (215.6) (270.7) (270.7)
--------------------------------------------------------------------------------------------------------------------------
Net debt at end of period (215.0) (217.2) (215.6)
--------------------------------------------------------------------------------------------------------------------------
10 Ashanti Goldfields, First Quarter 2003
NOTES TO THE FINANCIAL INFORMATION (ASHIANTI LOGO)
1. Basis of Preparation
The unaudited results for the three months ended 31 March 2003 have been
prepared in accordance with the accounting policies set out in the Annual Report
and Accounts for the year ended 31 December 2002.
2. Operating Profit Analysis by Business Area
3 MONTHS TO 31 MARCH 2003
IDUA- FREDA- HEDGING EXPLORA- CORP.
OBUASI PRIEM BIBIANI SIGUIRI REBECCA INCOME TION ADMIN GROUP GEITA TOTAL
------------------------------------------------------------------------------------------------------------------------------------
Production ounces 131,918 47,246 51,271 70,011 16,945 -- -- -- 317,391 63,538 380,929
------------------------------------------------------------------------------------------------------------------------------------
US$million
Revenue-spot 46.3 16.5 18.0 24.6 5.9 -- -- -- 111.3 22.3 133.6
-hedging -- -- -- -- -- (1.7) -- -- (1.7) (3.0) (4.7)
------------------------------------------------------------------------------------------------------------------------------------
46.3 16.5 18.0 24.6 5.9 (1.7) -- -- 109.6 19.3 128.9
Operating costs (27.0) (12.3) (12.0) (16.7) (4.5) -- -- -- (72.5) (12.9) (85.4)
Other costs -- (0.3) (0.1) (0.3) -- -- (0.7) (6.0) (7.4) (0.8) (8.2)
Royalties (1.6) (0.5) (0.5) (0.8) -- -- -- -- (3.4) (0.6) (4.0)
------------------------------------------------------------------------------------------------------------------------------------
EBITDA 17.7 3.4 5.4 6.8 1.4 (1.7) (0.7) (6.0) 26.3 5.0 31.3
Depreciation and
amortisation (7.9) (1.3) (2.3) (4.0) (1.5) -- -- (0.3) (17.3) (2.3) (19.6)
------------------------------------------------------------------------------------------------------------------------------------
OPERATING
PROFIT 31.3.2003 9.8 2.1 3.1 2.8 (0.1) (1.7) (0.7) (6.3) 9.0 2.7 11.7
31.3.2002 4.5 3.4 2.7 (0.9) 2.3 13.8 (1.0) (5.9) 18.9 5.4 24.3
------------------------------------------------------------------------------------------------------------------------------------
3 MONTHS TO MARCH 31, 2002
IDUA- FREDA- HEDGING EXPLORA- CORP.
OBUASI AYANFURI PRIEM BIBIANI SIGUIRI REBECCA INCOME TION ADMIN GROUP GEITA TOTAL
------------------------------------------------------------------------------------------------------------------------------------
Production ounces 140,096 -- 47,844 59,806 69,142 23,086 -- -- -- 339,974 69,410 409,384
------------------------------------------------------------------------------------------------------------------------------------
US$million
Revenue-spot 41.1 -- 14.1 17.6 20.2 10.1 -- -- 103.1 20.3 123.4
-hedging -- -- -- -- -- -- 13.8 -- -- 13.8 (0.3) 13.5
------------------------------------------------------------------------------------------------------------------------------------
41.1 -- 14.1 17.6 20.2 10.1 13.8 -- -- 116.9 20.0 136.9
Operating costs (26.5) -- (9.2) (11.1) (15.8) (5.2) -- -- -- (67.8) (10.1) (77.9)
Other costs -- -- (0.2) (0.1) (0.5) -- -- (1.0) (4.6) (6.4) (0.8) (7.2)
Refinancing and
restructuring costs -- -- -- -- -- -- -- -- (1.0) (1.0) -- (1.0)
Royalties (1.2) -- (0.4) (0.5) (0.7) -- -- -- -- (2.8) (0.6) (3.4)
------------------------------------------------------------------------------------------------------------------------------------
EBITDA 13.4 -- 4.3 5.9 3.2 4.9 13.8 (1.0) (5.6) 38.9 8.5 47.4
Depreciation and
amortisation (8.9) -- (0.9) (3.2) (4.1) (2.6) -- -- (0.3) (20.0) (3.1) (23.1)
------------------------------------------------------------------------------------------------------------------------------------
OPERATING
PROFIT 31.3.2002 4.5 -- 3.4 2.7 (0.9) 2.3 13.8 (1.0) (5.9) 18.9 5.4 24.3
31.3.2001 (1.7) 0.l 0.2 2.4 (4.4) (0.5) 23.6 (1.6) (5.5) 12.6 4.4 17.0
------------------------------------------------------------------------------------------------------------------------------------
3 MONTHS TO 3 MONTHS TO
31 MARCH 31 MARCH
2003 2002
US$m US$m
3. RECONCILIATION OF TOTAL COSTS ----------- -----------
---------------------------------------------------------------------------------------------
CASH OPERATING COSTS
Obuasi 27.0 26.5
Iduapriem 12.3 9.2
Bibiani 12.0 11.1
Siguiri 16.7 15.8
Freda-Rebecca 4.5 5.2
Geita (50%) 12.9 10.1
---------------------------------------------------------------------------------------------
TOTAL CASH OPERATING COSTS 85.4 77.9
Corporate administration costs 6.0 4.6
Exploration costs 0.7 0.1
Other costs 1.5 1.6
Royalties 4.0 3.4
Depreciation and amortisation 19.6 23.1
Exceptional costs -- 1.0
---------------------------------------------------------------------------------------------
TOTAL COSTS 117.2 112.6
---------------------------------------------------------------------------------------------
Ashanti Goldfields, First Quarter 2003 11
HEDGING COMMITMENTS
[ASHANTI LOGO]
The table below shows all forward and option positions that Ashanti had as at
31 March 2003:
2003 2004 2005 2006 2007 2008 2009 2010
--------------------------------------------------------------------------------------------------------------------------
FORWARD SALES
(ounces) 628,997 657,992 648,996 538,000 451,200 358,325 413,450 383,450
(US$/ounce) 345 355 352 359 360 370 362 366
--------------------------------------------------------------------------------------------------------------------------
CALLS:
Sold (ounces) 378,025 496,180 498,728 210,256 291,076 260,535 70,970 28,250
(US$/ounce) 341 341 350 366 363 365 368 350
--------------------------------------------------------------------------------------------------------------------------
Bought (ounces) 127,950 101,880 134,000 49,432 125,396 - - -
(US$/ounce) 348 359 352 370 370 - - -
--------------------------------------------------------------------------------------------------------------------------
Subtotal (ounces) 250,075 394,300 364,728 160,824 165,680 260,535 70,970 28,250
--------------------------------------------------------------------------------------------------------------------------
SUMMARY:
Protected (ounces) 628,997 657,992 648,996 538,000 451,200 358,325 413,450 383,450
--------------------------------------------------------------------------------------------------------------------------
COMMITTED (ounces) 879,072 1,052,292 1,013,724 698,824 616,880 618,860 484,420 411,700
--------------------------------------------------------------------------------------------------------------------------
Total committed ounces as a
percentage of total forecast
production (excluding Geita
production for the period of
the project finance, 2003-2007)
--------------------------------------------------------------------------------------------------------------------------
Lease Rate Swap (ounces) 2,367,000 2,587,000 2,251,000 1,915,000 1,579,000 1,318,000 982,000 646,000
--------------------------------------------------------------------------------------------------------------------------
Deferred Hedging Income (US$m) 10 11
--------------------------------------------------------------------------------------------------------------------------
2011 2012 2013 Totals
-------------------------------------------------------------------------
FORWARD SALES
(ounces) 268,250 215,313 186,500 4,750,473
(US$/ounce) 367 374 365 359
------------------------------------------------------------------------
CALLS:
Sold (ounces) 84,250 77,188 28,000 2,423,458
(US$/ounce) 384 387 401 355
------------------------------------------------------------------------
Bought (ounces) - - - 538,658
(US$/ounce) - - - 358
------------------------------------------------------------------------
Subtotal (ounces) 84,250 77,188 28,000 1,884,800
------------------------------------------------------------------------
SUMMARY:
Protected (ounces) 268,250 215,313 186,500 4,750,473
------------------------------------------------------------------------
COMMITTED (ounces) 352,500 292,500 214,500 6,635,272
------------------------------------------------------------------------
Total committed ounces as a 50%
percentage of total forecast
production (excluding Geita
production for the period of
the project finance, 2003-2007)
------------------------------------------------------------------------
Lease Rate Swap (ounces) 310,000 130,000 -
------------------------------------------------------------------------
Deferred Hedging Income (US$m) 21
------------------------------------------------------------------------
Forward Sales:
A total of 4.75 million ounces have been sold forward at an average price of
US$359 per ounce.
Call Options:
Ashanti has sold 2.42 million ounces of call options at an average strike price
of US$355 per ounce. As a partial offset, Ashanti has bought 0.54 million
ounces of call options at an average strike price of US$358 per ounce.
Gold Lease Rate Swaps:
As of 31 March 2003, a maximum of 2.59 million ounces of Ashanti's hedged
production will be exposed to the floating 3 month lease rate at any one time.
The lease rate swaps can be broken down into the following types (under all of
these contracts Ashanti receives a certain lease rate income, which can be
regarded as compensation for the lease rate exposure that Ashanti takes on).
Volume (ozs) Fixed Rate Description
-----------------------------------------------------------------------------------------------------------------------------------
2,412,000 1.80% Ashanti pays a quarterly floating rate and receives a quarterly weighted average fixed rate of 1.80%.
-----------------------------------------------------------------------------------------------------------------------------------
360,000 2.00% Ashanti pays a quarterly floating rate and receives a fixed amount of dollars at maturity. The
quarterly amount is rolled until maturity of each forward contract. The fixed amount for each
contract is calculated using the formula:
Volume*YearsToMaturity*302*2.00%. The next rate set is in 2004.
-----------------------------------------------------------------------------------------------------------------------------------
TOTAL
2,772,000
-----------------------------------------------------------------------------------------------------------------------------------
Marked-to-market valuations:
On 31 March 2003, the portfolio had a negative
marked-to-market value of US$93.2 million. This valuation was based on a spot
price of US$336 and the then prevailing applicable US interest rates, gold
forward rates, volatilities and guidelines provided by the Risk Management
Committee of the Board. The delta at that time was 5.5 million ounces. This
implies that a US$1 increase in the price of gold would have a US$5.5 million
negative impact (approximate) on the marked-to-market valuation of the hedge
book. Movements in US interest rates, gold lease rates, volatilities and time
will also have a sizeable impact on the marked-to-market. All these variables
can change significantly over short time periods and can consequently
materially affect the marked-to-market valuation.
The approximate breakdown by type of the marked-to-market valuation at 31 March
2003 was as follows:
US$m
Forward Contracts (32.7)
European Call options (net sold) (64.2)
Lease rate swaps 3.7
-----
(93.2)
12 Ashanti Goldfields, First Quarter 2003
[ASHANTI LOGO]
HEDGING COMMITMENTS
Geita Hedging
The table below shows Ashanti's portion of hedging commitments for Geita as at
31 March 2003. This represents half of Geita's hedge commitments.
2003 2004 2005 2006 2007 Total
---------------------------------------------------------------------------------------
Forward Sales (ounces) 141,270 195,558 174,828 94,576 120,938 727,170
(US$/ounce) 286 289 294 296 298 292
---------------------------------------------------------------------------------------
Puts:
Bought (ounces) 18,715 25,586 24,350 18,115 23,390 110,156
(US$/ounce) 291 291 291 291 292 291
---------------------------------------------------------------------------------------
Summary:
Protected (ounces) 159,985 221,144 199,178 112,691 144,328 837,326
---------------------------------------------------------------------------------------
Committed (ounces) 141,270 195,558 174,828 24,576 120,938 727,170
---------------------------------------------------------------------------------------
Lease Rate Swap 156,301 116,774 76,301 41,420 -- --
---------------------------------------------------------------------------------------
Marked-to-market valuation:
On 31 March 2003, the Geita portfolio had a negative marked-to-market value of
US$72.5 million (Ashanti's portion: negative US$36.25 million). This valuation
was based on a spot price of US$336 per ounce and the then prevailing US
interest rates, gold forward rates, volatilities and guidelines provided by the
Risk Management Committee of the Board.
Ashanti Goldfields, First Quarter 2003 13
FORWARD LOOKING STATEMENTS [ASHANTI LOGO]
This report contains a number of statements relating to plans, forecasts and
future results of Ashanti Goldfields Company Limited ("Ashanti") that are
considered "forward looking statements" as defined in the Private Securities
Litigation Reform Act 1995 of the United States of America including but not
limited to those related to future working capital, future production levels,
operating costs and plans for diversification. Ashanti may also make written or
oral forward-looking statements in its presentations, periodic reports and
filings with the various regulatory authorities, in its annual report to
shareholders, in its offering circulars and prospectuses, in press releases and
other written materials and in oral statements made by its officers, directors
or employees to third parties. These forward looking statements include
statements about our beliefs, hopes, projections and expectations, and may
include statements regarding future plans, objectives or goals, anticipated
production output, the anticipated productive life of mines, projected
cashflows, debt levels, and marked-to-market values of and cashflows from the
hedgebook.
Such statements are based on current plans, information, intentions, estimates
and projections and certain external factors which may be beyond the control of
Ashanti and, therefore, undue reliance should not be placed on them. These
statements are subject to risks and uncertainties that could cause actual
occurrences to differ materially from the forward looking statements, such as
the risks that Ashanti may not be able to achieve the levels of production and
operating costs it has projected. Additional risk factors affecting Ashanti are
set out in Ashanti's filing with the US Securities and Exchange Commission.
Ashanti can give no assurances that such results, including the actual
production or commencement dates, construction completion dates, costs or
projection output or anticipated life of the projects and mines, projected
cashflows, debt levels, and marked-to-market values of and cashflows from the
hedgebook, will not differ materially from the forward seeking statements
contained in this report. Such forward looking statements are not guarantees of
future performance and involve known and unknown risks, uncertainties and other
factors collectively referred to as "Risk Factors," many of which are beyond the
control of Ashanti, which may cause actual results to differ materially from
those expressed in the statements contained in this report. These Risk Factors
include leverage, gold price volatility, changes in interest rates, hedging
operations, reserves estimates, exploration and development, mining, yearly
output, power supply, Ghanaian political risks, environmental regulation, labour
relations, general political risks, control by principal shareholders, Ghanaian
statutory provisions, dividend flows and litigation. For example, future
revenues from projects or mines described herein will be based in part upon the
market price of gold, which may vary significantly from current levels. Such
variations, if materially adverse, may impact the timing or feasibility of the
developments of a particular project or the expansion of specified mines.
Other factors that may affect the actual construction or production
commencement dates, costs or production output and anticipated lives of mines
include the ability to produce profitably and transport gold extracted
therefrom to applicable markets, the impact of foreign currency exchange rates,
the impact of any increase in the costs of inputs, and activities by
governmental authorities where such projects or mines are being explored or
developed, including increases in taxes, changes in environmental and other
regulations and political uncertainty. Likewise the cashflows from and
marked-to-market values of the hedgebook can be affected by, inter alia, gold
price volatility, US interest rates, gold lease rates and active management of
the hedgebook.
Forward looking statements speak only as of the date they are made, and except
as required by law, or unless required to do so by the Listing Rules of the UK
Listing Authority, Ashanti undertakes no obligation to update publicly any of
them in light of new information or future events.
14 Ashanti Goldfields, First Quarter 2003
ENQUIRIES [ASHANTI LOGO]
ASHANTI GOLDFIELDS COMPANY LIMITED
KWEKU AWOTWI
MD Responsible for Public Affairs Tel: (+233) 21 772331
ERNEST ABANKROH
Company Secretary Tel: (+233) 21 774977
CORINNE GAISIE
UK Representative Tel: (+44) 20 7256 9938
GOLIN HARRIS
Allan Jordan
Federico Brigatti Tel: (+1-212) 697 9191
website: www.ashantigold.com
Ashanti Goldfields, First Quarter 2003 15