Anglogold Ashanti
“’ launching a cost
-cutting drive
 
Johannesburg, South Africa — MININGREVIEW.COM — 18 February 2010 – Kumba Iron Ore “’ the world’s fourth largest supplier of sea-borne iron ore “’ has reported a dip in full-year headline earnings, but says production and export sales are up, and output will rise further in 2010.

Kumba, which is Africa’s biggest producer of iron ore, said in its latest results statement published here that basic headline earnings per share for the year to 31December 2009 had dipped to R21.82 from R23.02 in 2008, hit by a stronger rand against the U.S. dollar.

The company went on to say that it had produced 41.9 million tonnes of the steel-making ingredient last year, up from the 36.7 million tonnes it had produced in 2008. Export sales had increased 37% to 34.2 million tonnes.

“Kumba is committed to a further increase in production volumes during 2010, with the continued ramp-up of the Jig plant,” the company said in the statement.

Kumba’s domestic sales will depend on the off-take from ArcelorMittal, while analysts expect Chinese demand for iron ore to grow by at least 5% this year, the statement said.

“Although global steel demand is expected to return to growth in 2010, this is likely to be moderate, and the sustainability of increase in demand outside of China remains uncertain,” it added.

Kumba said its operating profit had remained highly sensitive to the rand/dollar exchange rate. The South African currency had risen around 20% since the start of 2009.