Gold mining major AngloGold Ashanti increased production by 17% and decreased production costs by 22% in the first quarter of this year, according to a press statement that also revealed the company’s adjusted headline earnings to be $119-million, or 29c a share.

AngloGold Ashanti CEO Srinivasan Venkatakrishnan (Venkat) points out that these numbers beat first-quarter production and cost guidance as operating performance and cost initiatives continue to reposition the business.

“Our operators have delivered another strong performance and we continue to manage costs aggressively. There’s still plenty of work to do, but with a strong team intact, a good foundation, and some significant wins under our belt, we remain focused on continuing to deliver positive results to our shareholders under tough market conditions,” he explains.

The company’s first-quarter production of 1.06-million ounces, at a total cash cost of $770/oz, was the strongest first-quarter performance in four years, compared with a production and cost guidance of between 950 000 oz and one-million ounces, at a total cash cost of between $800/oz and $850/oz.

Meanwhile, AngloGold Ashanti’s all-in sus-taining cost, which includes sustaining capital expenditure (capex), as well as corporate and exploration costs, declined by 22% to $993/oz.

“The 17% rise in production year-on-year and 22% decline in costs were aided by the continued ramp-up of the new, low-cost Kibali and Tropicana mines, together with ongoing efficiency improvements across the company,” explains Venkat.

The company co-owns Kibali gold mine, in the Democratic Republic of Congo (DRC), with gold major Randgold Resources and DRC government entity Sokimo. AngloGold Ashanti also co-owns the Tropicana mine in Western Australia with base metals and gold junior the Independent Group.

“AngloGold Ashanti has taken decisive steps to adapt to the sharp decline in the gold price and more volatile market conditions over the last 18 months. In this period, corporate and exploration costs have more than halved and the company is on track to realise its target of $500-million in yearly operating cost savings by the end of 2014,” states the company, adding that capex has been further rationalised.

AngloGold Ashanti maintains that none of these actions have compromised the long-term outlook of the business. The gold miner continues to invest in the expansion of its Cripple Creek & Victor mine in the US, extend the life of its Mponeng mine in South Africa, and support a focused, high-quality project and exploration portfolio. The miner also recorded the best first-quarter all-injury frequency rate in 2014, which stood at an average of 7.76.

Meanwhile, AngloGold Ashanti has imple- mented a range of interventions at its Obuasi mine, in Ghana, to address historic underper-formance and high cost structures. The company, however, highlights that substantial additional work is required to establish a sustainable future for the mine.

“We have now developed a good working partnership with the government of Ghana, the Ghana mineworkers union and other key stake-holders to address the challenges facing Obuasi.

“We must do all we can to stop the current cash outflows at Obuasi and define a sustainable future – and we appreciate the support of our partners in taking the decisive action necessary to achieve this,” explains Venkat.