Standard & Poor Positively Rerates AngloGold Ashanti

Ghana Stock Exchange - listed gold miner AngloGold Ashanti on Monday welcomed the move by global ratings agency Standard & Poor’s (S&P) to affirm its BB+ long-term corporate credit rating despite the weak gold price.

S&P had previously put AngloGold on "CreditWatch Negative" after revising down its forecasts for the gold price this year and the next. It has now affirmed the rating and removed the company from CreditWatch, but the rating outlook remains negative because the company’s earnings are highly sensitive to the gold price.

That means the rating could be lowered within the next six to 12 months if gold prices fall below its forecasts. "While there remains an ‘ outlook negative’ on the rating, it’s worth noting that S&P have taken a pretty conservative view on the gold price, seeing it at $1,250/oz this year (it’s averaged $1,291/oz so far in 2014) and falling to $1,200/oz in 2015," AngloGold vice-president of investor relations Stewart Bailey said.

AngloGold’s bonds in the secondary market were looking strong, with its seven-year $1.25bn bond trading well above par at 109c on the dollar. Mr Bailey doubted whether S&P’s latest move would affect the ability of institutions to invest in AngloGold’s debt as it was an affirmation of the current rating. AngloGold’s bonds were rated investment grade by Moody’s, Mr Bailey added.

S&P said the reason for reaffirming the rating was that AngloGold’s cost-cutting, more favourable exchange rates and management’s ability to reduce capital spending partly offset the weaker gold price environment. But there was only a margin of $200-$250/oz between S&P’s gold price expectation and AngloGold’s all-in sustaining costs, before taking interest and taxes into account. AngloGold also needs to spend about $1bn on growth projects over the next two years.

"Any further cost-cutting programmes, especially any that involve shutting down mines if needed, or turning around loss-making mines, will require some lead time," S&P said. "This will, in our view, expose AngloGold to a mismatch between the spot prices and the company's cost structure." S&P could revise AngloGold’s rating outlook to "stable" if it raised its gold price assumptions or AngloGold was able to keep costs significantly below the forecast gold price.

AngloGold Ashanti has 20 mining operations, of which Obuasi and Iduapriem mines are located in Ghana.

About AngloGold Ashanti AngloGold Ashanti is a global gold mining company and the world’s third largest gold producer. Headquartered in Johannesburg, South Africa, AngloGold Ashanti has 20 operations on four continents and one of the gold industry’s most successful exploration teams which work across both the established and new gold producing regions of the world. This includes land positions in Colombia, Guinea and Australia, among others. AngloGold Ashanti employed 61,242 people, including contractors, in 2011 and produced 4.33Moz of gold, generating $6.6bn in gold income. Capital expenditure in 2011 amounted to $1.5bn. As at 31 December 2011, AngloGold Ashanti’s Ore Reserve totalled 75.6Moz. The primary listing of the company’s ordinary shares is on the JSE Limited (JSE). Its ordinary shares are also listed on stock exchanges in London and Ghana, as well as being quoted in New York in the form of American Depositary Shares (ADSs), in Australia, in the form of CHESS Depositary Interests (CDIs) and in Ghana, in the form of Ghanaian Depositary Shares (GhDSs)

Media Contact: John Owusu Tel: +233 244 322 026 E-mail: john.owusu@AngloGoldAshanti.com

ENDS

Certain statements made in this communication, other than statements of historical fact, including, without limitation, those concerning the economic outlook for the gold mining industry, expectations regarding gold prices, production, cash costs and other operating results, return on shareholders’ equity, productivity improvements, growth prospects and outlook of AngloGold Ashanti’s operations, individually or in the aggregate, including the achievement of project milestones, the completion and commencement of commercial operations of certain of AngloGold Ashanti’s exploration and production projects and the completion of acquisitions and dispositions, AngloGold Ashanti’s liquidity and capital resources and capital expenditures and the outcome and consequence of any potential or pending litigation or regulatory proceedings or environmental issues, are forward-looking statements or forecasts regarding AngloGold Ashanti’s operations, economic performance and financial condition. These forward-looking statements or forecasts involve known and unknown risks, uncertainties and other factors that may cause AngloGold Ashanti’s actual results, performance or achievements to differ materially from the anticipated results, performance or achievements expressed or implied in these forward-looking statements. Although AngloGold Ashanti believes that the expectations reflected in such forward-looking statements and forecasts are reasonable, no assurance can be given that such expectations will prove to have been correct. Accordingly, results could differ materially from those set out in the forward-looking statements as a result of, among other factors, changes in economic, social, political and market conditions, success of business and operating initiatives, changes in the regulatory environment and other government actions including environmental approvals, fluctuations in gold prices and exchange rates, and business and operational risk management. For a discussion of certain of these and other factors, refer to AngloGold Ashanti's annual report for the year ended 31 December 2011, which was distributed to shareholders on 4 April 2012, the company’s 2011 annual report on Form 20-F, which was filed with the Securities and Exchange Commission in the United States on 23 April 2012 and the prospectus supplement to the company’s prospectus dated 17 July 2012 that was filed with the Securities and Exchange Commission on 25 July 2012. These factors are not necessarily all of the important factors that could cause AngloGold Ashanti’s actual results to differ materially from those expressed in any forward-looking statements. Other unknown or unpredictable factors could also have material adverse effects on future results. Consequently, stakeholders are cautioned not to place undue reliance on forward-looking statements. AngloGold Ashanti undertakes no obligation to update publicly or release any revisions to these forward-looking statements to reflect events or circumstances after today’s date or to reflect the occurrence of unanticipated events, except to the extent required by applicable law. All subsequent written or oral forward-looking statements attributable to AngloGold Ashanti or any person acting on its behalf are qualified by the cautionary statements herein.

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