* First-quarter EBITDA down 16 percent to $314 million
* First-quarter output down 3.6 pct, sticks to 2017 forecast
* Shares under pressure
(Adds output, debt, capex, shares)
JOHANNESBURG, May 8 Africa's biggest gold miner
AngloGold Ashanti reported a 16 percent drop in
first-quarter profit on Monday following a decline in South
African production, sending its shares down nearly 5 percent.
AngloGold said adjusted earnings before interest, tax,
depreciation and amortization (EBITDA) came in at $314 million
in the first three months of 2017, down from $378 million in the
same period a year earlier.
"South Africa had a difficult production quarter as an added
focus on a safe start-up contributed to an unusually slow
ramp-up after the year-end break," AngloGold said in a
Shares in AngloGold, which competes with Harmony
and Gold Fields, dropped as much as 4.7 percent after
the market opened. By 0705 GMT, the stock had pared losses to
trade 2 percent lower at 147.54 rand.
AngloGold is in talks with unions about cutting some 800
jobs in South Africa, a country whose vast resources come with
the risk of volatile labour relations, rising costs, regulatory
disruptions and dizzying shaft depths.
"We are reviewing our South African operations to restore
their margin and ensure they recover from a difficult start to
the year," AngloGold Chief Executive Srinivasan Venkatakrishnan
said, without giving further details.
The ongoing review comes some two years after AngloGold,
which operates in eight other countries including Brazil and
Ghana, shelved plans to isolate its local mines by spinning off
its international assets into a new London-listed entity that it
had hoped would have attracted a higher investor rating.
Output from its domestic mines, which contribute roughly a
quarter of the company's annual gold production, has been
declining in recent years due to regulatory disruptions related
Overall output fell 3.6 percent to 830,000 ounces in the
quarter but the company stuck to its full-year production
forecast of 3.6 million ounces to 3.75 million ounces.
AngloGold said its net debt edged down 3.6 percent during
the quarter to $2.05 billion, putting the ratio of its net debt
to EBITDA at 1.38 times, well below the 3.5 times level agreed
The company plans to spend as much as $1 billion to revamp
and extend the lives of its high-return mines, it said.
(Reporting by Tiisetso Motsoeneng; editing by David Clarke)