AngloGold Ashanti was looking to cut costs after a 25 percent decline in the gold price this year, CEO Srinivasan Venkatakrishnan said in a statement on the company’s website.
“While we remain positive on the prospects for the gold price in the long term, we’ve taken the decision to prepare our business for a volatile gold-price environment, where we believe there may be downside risk in the medium term.”
He said the company would prioritise cash flow and returns over production levels in the uncertain gold market. At the beginning of the year, the company began reviewing its organisational design, and was now ready to implement the recommendations.
The changes would help remove duplication and waste, and create a cleaner leadership structure. This meant 40 percent of non-mining managerial jobs would be cut from the company’s international operations.
Company spokesman Alan Fine said there were around 2000 such jobs in total, and that around 800, would be eliminated. He could not say how many of the job losses would be at AngloGold Ashanti’s South African operations.
Venkatakrishnan said: “At each step in this cost rationalisation process, we’ve taken care to ensure we retain core skills and keep our key long term options intact, at a reasonable cost.”
The company would also narrow the focus of its exploration programme, and withdraw from more than a dozen countries to focus on its operations in Colombia, Tropicana, in Australia, and Siguiri, in Guinea.
It would continue to advance its underground technology in South Africa. Overall, AngloGold Ashanti planned to increase its overhead savings to US482 million (about R4.7 billion).
Last month, it was reported that AngloGold was reducing the head-count at its Johannesburg head office, and other offices in Africa, from 1000 to 220.