All job levels affected, says AngloGold on latest cuts | Fin24
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All job levels affected, says AngloGold on latest cuts

May 23 2018 16:21
Tehillah Niselow

Johannesburg - AngloGold Ashanti [JSE:ANG] has made "the difficult decision" to restructure the company to support a smaller footprint in South Africa, it said in a statement on Wednesday.

"AngloGold Ashanti has reduced its production in South Africa by about 50%, through the sale of the Kopanang and Moab Khotsong Mines in February, and the closure of the TauTona mine announced late last year," the statement said. 

The restructuring process will affect all employee levels, including the South African executive committee and senior management. 

"South African operations continue to face a multiplicity of challenges, including increasing depth and distance from central infrastructure, declining production profiles, and cost escalations that have continued to outpace both inflation and the gold price. In addition, the margins are negatively affected by a much stronger exchange rate," AngloGold Ashanti explained.

The company promised the consultation process with the trade unions would be aimed at ensuring the remaining assets - which employ approximately 8 200 people - remained viable. 

Fin24 earlier reported that mining unions received notices from AngloGold Ashanti regarding the retrenchment of 2 000 workers in all job categories and levels. This followed the 2017 announcement of over 9 000 job cuts, some of which were averted through the sale of the Kopanong Mine to Harmony Gold [JSE:HAR], transfers and voluntary severance packages.

The Association of Mineworkers and Construction Union (AMCU) attributed the envisaged job cuts to decreases in the gold price since 2016, as well as ore body depletion, increasing depths to mine, lower-grade gold ore, increased electricity and labour costs, declining production and the increased cost of borrowing.

The National Union of Mineworkers (NUM) said they would engage AngloGold Ashanti to try to prevent the retrenchments, while AMCU vowed to try preventing job cuts by working with its rivals. 

"We call on all trade unions to form a united front to save jobs in the mining sector," they said. 

AngloGold Ashanti's shares were trading at R101.13 by at 15:11 on Wednesday on the JSE, down by 1.05%.

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