Document RaNwwo1nR7Ra9rg98ozDRxoXB

FILE NAME Cape Asbestos CAPE DATE 0000 DOC CAPE185 DOCUMENT DESCRIPTION Consolidated Profit and Loss Account - Charter Consolidated Ltd. & Subsidiaries Legal - Tibbs Case Exhibit 83 6369 a it 411009 411009 + 33 194 | 981 eed extraordinary Hon extraordinary ileia cents 218 2940 2940 286 86992 ~ 31720 31720 Oly ( 1298 3172.76 3172.76 R000'S 172 202 202 84 148 207.930 207.930 Investment investments investments a CES anisins written and provision 8976 R47946-1 89897 76 86 976 8976 R47946-1 000 rectors valuation R28 PIZTBR 1976 39 30000 30000 a: Castro depositar research and transport equipmciy equipmciy 408 220.605 04.195 04.195 529 1953 [rrr 11 406 315439 232 158,367 5 226 247 825 112 612 11.956 124-568 263165 2 nbc 3 ST Mpg , research and equipmen |S aye y shameimlders before Posbate Scents Scents 1976 Year ended 31.82 ROQO'S 100513 100513 05 056 111 111 241 610 36411 w. * 40021 1-581 4.197 14.679 y 679110 836 Hs 2946 22 504 ~ )63-760 286 & 656 eB .63.474 * Notice members year end Financial staemnts Annual financial statements published Annual general a vanes] See 1 ordinary shares interim interiin report # . - final and provisional preference preference staternen cs ; : .March 31 July August fovember declared fovember declared of alan declared = June paid July aern - i - declared declared wy paid August - declaci declaci - December paid February : 3G ANNUAL GENERAL MEETING : ; Notice is hereby given that the sixty annual general meeting of members of Anglo American Corporation South Africa Limited will be held at 44 Main Street Johannesburg on Friday August 1978 11h00 the following business oo Bo Se a months To receive and consider the annual financial statements in the fifteen 0 March 311978 311978 respect of sa To elect directors accordance with of the provisions the Cor- poration's articles of association 2 oe To consider and deemed fit to pass with or without modifi- cation the following resolution an ordinary resolution namely That directors be and they are hereby authorised representing 4 allot issue all or portion a of the 9 650 000 unissued redeemable cumulative preference shares 2.5 cents each in the capital of the Corporation and after providing the allotment and issue ofthe ordinary terms of the share incentive scheme the share option schenie shares which shall have been set aside for allotment in substitution for shares Rand Selection Corporation Limited arising on conversion : of bonds of 1000 each > 92 the Rand Selection US million 6 per cent convertible loan 1986 all or any portion of remaining 13.732-254 ordinary unissued any shares of 10 cents each in the capital of the Corporation at such time times to such person or persons company or companies and upon such terms and conditions as they may determine ii To arrangements on such terms conditions as they may deem fit for the subscription by underwriters of OSS b shares offered way rights issues but not taken + the persons entitled thereto and up : kt We eh b any shares resulting from the consolidation of any fractional @ entitlements in respect any shares issued in pursuance of shares a rights issue provided that any rights such which on can be sold paid form The Johannesburg and London Stock Exchanges during the period which they - quoted such stock exchanges may be sold by the underwriters and the net proceeds of sale of rights |. shall be paid to the Corporation 002. oa os and o The head office United Kingdom transfer registers and the register of members ofthe Corporation will closed from to August 1978 both days inclusive : August . : ae to Holders ofwarrants bearer who wish proxy ga vote at attend in person or any general meeting of the Corporation must with comply the regulations ofthe Corporation under which share warrants bearie ssur ed . are member entitled ad attend and vote at the meeting entitled to appoint proxy to attend speak and vote his stead A not be member ofthe Corporation proxy need 27% By order of the board JT GOLDFINCH Managing Secretary July 25 1978 Registered Office : 44 Main Street Johannesburg ANGLO AMERICAN CORPORATION OF SOUTH AFRICA LIMITED Containing Containing the fifteen months ended March 31 0 7 GroujaGroudjadmimnistiyanciicspty Directed deviciu^ Annualiitoneal stateistnateinchtschstatteincshts oD financial financial statistics statistics Interests of the Group Subsidiaries resolitudes 103 Directors shareholdings 103 enstag verlig windsock windsock The Corporation it's relationship to the Group and to its major associates Anglo Americap Corporation mining industrial and investment esti iatedat approximately R5 400 January 1977 the Corporation merger with Kand Selection groupof international companies aies companies whose overall size million With effect from considerably enlarged through Corporation mining Buance houses have traditionally operated the group system whereby the parem house tot oply abiipisters ongames ongames that are not necessa ilysubsidiaries but provides them with hill technical also services services and is able by aid standing members of the thoup development De Consolidated though not groupto ipdusty than audited annual Section Section Interests in the year a brict pages 16:44 of subsidiaries us statutory The Ghomps Ghomps structure Solalined significani sharchoffing sharchoffing sharchoffing the hart shows the rearonships between between the Corporation and investient companies of the Group and the Anglo American Group and his two t^ ng^sodates ^sodates De and Charter The figies printed each circle show the percentage interest interst in that company for associate for example company held wight Chatter which in turn has six per anishci Group compancoympany Corporation holds 36 per American and- 20 Rescentes Corporation Minorca Minorca The businofeAnsglso American American Congioration is to investin -companies many of which it administers and develops In mining the Anglo Anglican and Gu^...upits associates have important interesis in the production of gold and mamium diamonds copper and nickel coal platinum tin and wolfiam The Group'sjndustrial -and heavy heavy engineeritongconstriction iron jndustrial me lead zinc manganese inf^rests making constriction motor vehicles paper a i textiles chemicals drilling foods wehactories wehactories wehactories and foodstuffs The principal commercial interests are banking computer services Southern Southern and travel insurance and property Group's investments are held mainly through the specialised companies identified in the chait such as Anglo American Gold Rivestiment Rivestiment Company Anglo American Investment Trust the diamond mining and marketing investments and Anglo American Industrial Corporation The majority of the mining interests are consolidated iij Anglo American Coal Corporation Minorco based in Bermuda participates the Group's international mining and industrial interests while on geographical basis there are Anglo American Corporation of Canada Amcan Anglo American youporation Rhodesia Zambia Copper Investments Australian Angio American and Anglo American Corporation do Brasil The valuations given the chart calculated as at March 31 1978 Anglo American Corporation has had only two Chairmen the founder Sir Ernest Oppenheimer from 1917 1957 and the pr^'sent Chairman his son Mr Harry Oppenheimer This has brought a continu ofipotliycy to the activities of the Corporation whose aims are to earn profits for its shareholders but do so in such a way as jo make a real and lasting contribution to the welfare of the areas and countries where it operates : are began The Corporation's roots firmly planted in Africa where it began its interests there both in mining and in wide range of industries are continuing to grow But its resources are also being applied internationally in mining and related fields through Minorco Charter and Amean Geological exploration similarly has become world The Group associates are involved in prospecting programmes in Abica in North and South America in Australia and in Europe The Corporation's original capital 1917 was f.million f.million which avas faised from British American and South African sources -- hence title Anglo American Corporation of South Africa The present capital capital and reserves exceed R860 million the Corporation's investments investments at March 31,1978 were valued at R2 269 million ao illustrate the scaloef its mining operations in 1977 the Group was responsible for over 37 per cent of South Africa's gold output equivalent to about 27 cent of world production excluding communist countries for 33 cent of South Africa's coal and 40 per cent of uranium The copper mines Which the Group is interested accounted for 13 per cent of world production in 1977 Following the merger Anglo American Corporation with Rand Selection registered ordinary shareholders increased by 8 000 to more than 24 000 while bearer centificates in issue increased increased 7 000 to nearly 45.000 The majoritoyf the share capital is held in South Africa with most of the balance held in the United Kingdom and other European countries * BEERS CONSOLIDATED MINES 0 oS Value we Market of capital equity equity 2. ANGLO AMERICAN GOLD INVESTMENT of Market value equity capital R610 266 000 ANGLO AMERICAN INDUSTRIAL CORPORATION Market value of equity capital R228 327 000 ANGLO AMERICAN COAL CORPORATION Market value of equity capital R199 677 000 ANGLO AMERICAN AMERICAN CORPORATION DO BRASIL in Investnet AUSTRALIAN ANGLO AMERICAN ANGLO AMERICAN PROPERTIES Market voling capital R13 280 000 ANGLO AMERICAN CORPORATION RHODESIA Equity shareholders interesti MINERALS AND RESOURCES CORPORATION CORPORATION CORPORATION Market value of equity capital US5T1331.000 US5T1331.000 ZAMBIA COPPER INVESTMENTS Marker of valor equity capital USS 18 021 000 The year in brief As from danuary 1-1977 Rand Selection Selection Corporation was merged into Anglo AmericaAnmerican Cormation to form a mining finance house of very great strength strength The merge was accompanied by change in Corporation'Corpsoration's year end month period to March per share were 89,0 cents special comprised a special 31. Net opuy earnings for the 15 were 195 million whije varnings totalling 43,25 cents a share cents an interitu dividend dividend of 12 12 cents and a final dividend of gents share the Corporation's of Share the its associates undistributed prolits fourits investments whicritor whicritor account mouths to March March 1978 approxiesately approxiesately after aduisting for crossholdings would be Muang.compared 132 cents share for end Blbumonds Copper Coal Platinum Other mining Industrial Finance Property Oil and gas : beeee of Value investments Percentage 1978 43 19 1976 34 16 tee 1 ee) nee=e, 17 7qd Investment income Percentage 1978 1976 30 34 32 .20 .20 ' 8 5 i ! 15 would number of shareshasres effectively effectively have been approximately 70 cents approximately 112 cents a share period was made under in investments Soci^'t^' BRSD . R1 997 geographical locanon the corporation's underlying investments of given and prituary sourcsource e dired investfifients and the chapanies in which is analyses for 1978 consolidatural Rand Selection for the first higher normal dinceringests Mishrican Angles L The valueat the assocated finance companies and property companies finance mdustrial by Corporation was approximately RI 7000 total of value these administered administered The value the direct interests 1978 while the estimated coniganies was abou R3 700 milli^n finance companies in non administered administered administered companies amounted to R1 900 million This beings the value of the direct intereosf t thse Corporation andits associated associated finance finance companiniae bosut R3 600 million the overall size the Groups being the aggregate value value of the administered companies and the direct interests non- administered companies to about RS 600 million INVESTMENT COMPANIES The principaladministered principaladministered investmem companies include Anglo American Gold Investment TruDany Amgold Anglo American Investment TruDany TruDany American Industrial Industrial Corporation Amic and Angin . Coal Corporation Aincoal Despite an improved gold declined by 377 per cent to R45.2 price Amgold's investment income million as result increased working costs and capital expenditure incurred by the gold mines Nei carnings for 1977 were raillion less at 11.5 million and the Geographical South Africa South West Africa Rest of Africa south of equator North America Elsewhere : attributable outside 100 13500 13500 shareholders in subsidiary companies dividend was reduced by 15 cents^ocents^o 165 cents a share Auamint's gamings for the year ended 31-1978 rose R64,6 million and the dividend increased by 46 per cent to 600 cents a share reflecting the further improved earnings of De Beers Consolidated . Mines Amie was affected by depressed economy and by the sharp drop in the markets for timber and related products Net equity earnings declined by 5.5 per cent to R40,6 million and earnings per share by nine cems to 151,1 cents for the year ended December 31 1977 However in view of the increased carnings achieved by the main subsidiaries Boari International and Scaw Metals and the improved outlook for the timber sector the dividend was increased by five cents to 70 cents a share Aincual experienced another highly successful year with net -earnings improving by 68 per cent to R47,3 million and the dividend increasing by 50 cent to 60 cents a share the year ended December 31 1977 GOLD URANIUM Although the tonnage increased by 5,7 per cent lower recovery grades resulted in further decline in Group gold production by 3,1 per cent to 262,408 kilograms Despite lower production and 14,6 per increase in unit costs working profit improved by 12,3 per cent to R433.9 million because of the higher average selling price of R4 082 a kilogramor about 146 an ounce Taxation State's shares of profits absorbed R160,2 million or 36.9 per cent Two new gold and uranium ventures East Rand Gold and Uranium Unlisted general Book value Investment income income warniwarninngs wgarnisngs pet share 1978 Sterim of 8,25 a cents sharer March 31 1978 ' R000's 85819 85819 713779 713779 1996 731 121796 121796 272 296 179 195 036 89,9 cents 99 132 45.25 cents 222 964 December 31 1976 ' ROOD'S 469 692 411.009 411.009 221 114 679 059 87 181 85.992 85.992 65,3 cents 465 33 cents 131 300 December 31 1975 ROOO'S 447 802 353 997 842 164 968 235 246 81194 81194 428 64,1 cents 43.449 43.449 cents 131 672300 672300 Elandstand gold mine & well and expected to come Production of by the Group's during the period ahead of schedule increased by 32.9 per DIAMONDS Sales of rough geny Organisation Organisation increased increased by 33 per Mines record of 2 073 million De Beers Consolidated diftiated consolidated its consolidated net carnings in R623 million more than million equivalem to deterrad Share in another extremely successful year The diamond account rose by R500 million to R751 million heciuse of * higher volume of sales and the price increases in September September 1976 March 1977 and to lesser extent December 1977. record total A dividend of 52,5 cents a share 1976 35 cents paid Total mine output output increased increased the 1976 level by 1-262 1-262 000 carats FL8 level million COAL Higher export and domestic price responsible for improveinem of nearly nearly 50 to carnings carnings Group collieries collieries R73,7 million 30,6 per c^mjo 259 million Anu ^al'snew expected to prodfice its list coal at the end of within budget increase increase were mainly per cent in the pre Amc^'al tinover tinover rose by Kleinkopje mine is 1978 with the total cost the capital of R109 million coal exports at R24 diamonds as South Africa's third largest in 1977 coal tanks and gold and largest contrcointribbutor uctontroiburtor to export export turnover OTHER : Depressed copper prices during the year continued to from the Group's copper interests While the London MiemtpaalirExecarhnainngges price has recently recently recovered slightly prospects for a material increase during the next months are not encouraging Nehanga Consolidated Copper Mines and Roan Consolidated Mines are incurring substantial losses with operations.continuing operations.continuing to be bampered by shortages ofskilled staff of components and closure of the Benguela railway outlet to Lobito by the : Hudson Bay Mining and Smelting reported consolidated 4,1 million earnings of 4,1 excluding an extraordinary gain of CS52,6 million from the sale of potash assets in Saskatchewan Earnings which adversely affected by weak metal fertilizer markets nonethweelerses; improved in 1977 largely because Hudbay's petroleum subsidiaries Francana Oil & Gas and , Canadian Merrill benefited from increased production and higher product prices Two new base metal were brought inte production the Flin Snow Lake mines area INDUSTRY Highveld Steel and Vanadium Corporation again reported improved results for the year to June 30 1977. Net equity earnings rose by R4.8 million to R20,7 million with earnings per share increasing by 12 per cent to 30,6 cents The successful commissioning of plate mill enabled Highveld to enter a new sector of the local market as a second supplier Notwithstanding difficulties theinternational steelmarket Highveld ma^-inainedsatisfactory exports Despite difficult trading conditions and adverse foreign movements Boart international increased currency R17.5 million in 1977 earnings by 6.7 per cent to . milSlciaown Metals increased earnings for 1977 by 10,6 per cent to R16 . Consolidated net earnings of Mandi Paper Company its subsidiary South African Board Mills major Limited rose by R1.9 million to R10.2 million despite reduced local demand for cent surcharge newsprint a 15 per on imported raw materials and generally adverse trading conditions Directorate CHAIRMAN HF * Oppenheimer DEPUTY CHAIRMEN Sir Keth Acute KBE British GWH GWH Relly DIRECTORS WG * Bousfred JN Clarke British " Di Za de Beer MP A Filieredge * OBL GC Fletcher MC HR Fraser British CJ Griffith EP Gush MB Hofmeyr | JA Holmes British Nidigon GLangionty DG British* NFOpenheimer NFOppenheimer British Sir Philip Oppenheimei British BW Pain British Sir Albert Robinson British G Stopford Sackville British 1 Ogilvie Thompson GH GH Waddell W Wilson Executive director ALTERNATE DIRECTORS DEM GM Atmore B.E Bullett British GA Smith British HK Davies Dr H Dyer WJH^'fa DB Toffe FJA Howard 3 JohnsonBritish British Johnstone MW King OP Koevon P.JR Leyden British DE MacIver JL Mackenzie A McKerron CDM Melville Dr LG Murray MC O'Dowd W Stephenson British JD Taylor Canadian VI Webber British A Wilson Group administration a v CHAIRMAN'S OFFICE Ogilvie Thempson GH Waddell GC DB Hoffe A Holmes Dd MW King Chier ACCOUNTANT ACCOUNTANT GC Legna ID Favior Manpower Resotices Office VONALH LANDS T Mann ND Mongan FJWorth FJWorth SENIOR MEDICAL CONSULMANE CONSULMANE JLC Whitcombe MEDICAL CONSER PANE Technical Technical Oiltee DIRECTOR A Holmes DAPETY TECHNICAL TECHNICAL TECHNICAL DMG MAtmore DIRECTORS DIRECTORS 2. Johnson DE Machver 91 PMackenzie D Muir 31 Stephensi CHIEF CHIEF CONSETTING CONSETTING METALLURGIST AD Deschar Deschar CONSIGLING DR Yetton ARCHITE ARCHITE CONSULTING W OPERATING DIVISIONS Enam International International ~ S CHAIRMAN 6C Fletcher MANAGING DIRECTO Hi Davies Chat AIRMAN AIRMAN WG Bousted MANAGING DIRECTOR TA Braithwaite Braithwaite DEPUTY MANAGING D'Rankin DIRECTOR CONSULTING CONSULTING ENGINEERS CONSULTING CONSULTING GEOLOGIST Dr DAM DAM Smith CONSULTING MECHANICAL AND PLECTRICAL ENGINEERS HM HM Kinghorn GO Painell CONSULTING CONSULTING METALLURGIST METALLURGIST HS Schwartz ENERGY CONSULTANT R1 Cohen FINANCIAL DIRECTOR JAB Nichols MARKETING AND SALES DIRECTOR D Ritson PERSONNEL CONSULTANTCONSULTANT DB Wiggill Commerce and Industry CHAIRMAN CJ Grillith MANAGER OP Koevor Diamond Services CHAIRMAN # J Ogilvie Thompson MANAGERS Dr B Dyer PJR Leyden A Wilson CONSULTING ENGINEERS AK Chant SF Gandar JC Martens CONSULTING GEOLOGIST Dr G Murray CONSULTING MECHANICAL AND ELECTRICAL ELECTRICAL ENGINEERS TA MacKinnon KJ KJ Trueman CONSULTING METALLURGISTS JF.Slabbert JF.Slabbert FINANCIAL DIRECTOR LA Lincoln PERSONNEL CN Cross CONSULTANT Food and Agriculture CHAIRMAN Wefer Wefer nN a Gold and Bronium CHAIRMAN DA Herage CONSULGET ^ I I ON GISG TS Dr PJ Pienaa Dr AM Smith Property CHAIRMAN GB Wadell ; REGIONAL OFFICES ; AAusttrraalliiaa Brazil CHAIRMAN MANAGING DIRE PCB Bundl FOR Canada CHAIRMAN HR Fraser PRESIDENT EP Gush INANCIAL DIRECTOR DIRECTOR | AAM M Doll : Rhodesia Chiat va . 6. o Carey Carey Smith 4 MANAGERS BB Bullet 16 de Zwaan RJ Helley CONSULTING ENGINELR 11 Pictorius CONSULTING OGIST Elymari Elymari TONUETING TONNUETING MECHANICAL ELECTRICAL ENGINEER ENGINEER ENGINEER JH Moll AND PJ Mostert United Kingdom HONDON COMMITTEE ; MB Holmeyr Chairman Sir Philip Philip Oppenheimer BW Pain 3 Richardson G Stopford Sackville CONSULTING ENGINEERS JV Cleasby South HJ Stucke 2 CONSULTING CONSULTING D LF Osten GEOLOGIST GEOLGIST CONMETING MECHANICA ANLD BIFCERICAL ENGINEERS A W Purkiss 5 Sheet CONSUETING METALLURGIST RM RM Chaston : Zambia MANAGING DIRECTOR W1 Webber TECHNICAL TECHNICAL DIRECTOR MW Stephenson CONSULTING MP O'Connor CONSULTING GEOLOGIST . Dr PV Freeman CONSULTING MECHANICAL AND : ELECTRICAL ENGINEER AGV Pearce CONSULTING METALLURGISTS METALLURGISTS B Barlin JD Parker " a Directors review ye # * , Finance and Investment Investment 11 Gold uranium Diamonds 22 Coal 26 Other mining 28 Industry and commerce 32 . Directors review ' Finance and investment extraordinary charge of R33.5 million was made against profits in respect of the investments in Soci^'t^M'ini^rede Fungurume Rand Selection merger completed The period period under under ever faced by South one of most dificult SMTF and Botswana 2ST Limited BRST Although the Corporation and Rand Selection Corporation in their 1976 financial years provided a total of R30 million against their investments in SMTF it was considered prudent as base metal prices have shown no evidence of payments Therefore continued to affect confidence capital and although country'scountry's ability to adopt policies that As a result there was a large net surplus was achieved in the balance current account the coffurain critical critcal coffurain reserves remained low and on policy Inflationary in Sustained Sustained recovery recovery and has been made with the alterna tive of smaller scale project project to make a further provision of R10,4 million against this investment so that the book value has been provided against in full The Shaba province of Za^flre in which the SMIF ogchudy is located was invaded by Government forces inin May 1978 and the town of Kolwezi was recaptured with the aid of French and Belgian troops < abating and in consequence there was measures real domestic that had spending been 1977 of the restrictive restrictive monetary and fiscal introduced the previous year The effect on was severe ani virtually all sectors of the economy were exposed to exceptional strains that were widely reflected in lowe profits and rising unemploymen These conditions to seine mitigated by the outstanding outstanding agricultural agricultural season the good performance t fhe gold price performance of non particularly in exports and the firming of 1977. By the end of the some hoplying that the declining hich aims seletively seletively further iimproved mproved by stimulate the economy the CircumstancCirecumsstances the Corposition's with the previous Corposition's results were satisfactory satisfactory are mnot eaningful because the Selection Corporation Limited BRST recenly reported that agreement had been reached between the principal shareholders the Botswana Government and the principal project lenders for the organisation of the financial the structure and sales arrangements of BCL Limited operator of copper proj^^tat Phikwe in Botswana in which BRST holds an 85 per cent interest The major effects of this organisation will be to reduce BCL's interest burden and improve cash flows by as accelerating receipt of sales proceeds as well removing the obligation to produce sulphur part of the Phase I requirements Although production levels increased substantially during the second half 1977 the prices of nickel and copper remained depressed and BRST recorded a foss before extraordinary charges of P3,7 million of sound P35.4 million for the year ended December 31 1977. In the light of these factors it has been considered to make a full provisi^nprovisi^n as an extraordinary item , of R25,9 million against the investment in 1977 to form a BRST as a March 31 1978 house of consid^'rable- strength strength and status in The marker value of listed investments at March 31 1978 was ee simplification of the structung of the Cor- R1 996,7 million an excess of R1 282,9 million over the book value of also offered the benefits obrationalisation obrationalisation R713,8 million The directors valuation of unlisted investments at the merger merger was accompanied year end was R272.3 million endend the March 31 on which The value of the direct interests of fit asserse the entity Anglo American Corporation and exceded its associated finance companies listed on page 12 in the mining The comments comments artofion relate the finance industrial and property companies administered by the | Statement and balafuge to consolidated Inconie Corporation was approximately 700 million at March 31 1978 and Statement companies Net county camnings of the Corporation and hs subsidiaries month period to March 31 1978 were while the estimated total value of these administered about R3 was R195 million 1976 while earnings million The value ofthe direct interests of the Corpora the effective muumber of shares earnings per share based on and its associated finance companies in administered in isste during the period under under review companies amounted to RJ 900 million This were 89,9 cents 1976 65,3 cents General investment income direct interests of the brings the value of the amined to R213 million 1976 R million and Corporation and its associated finance com- j net income from fees interest and after sources after deducting administration panies to about R3 600 million and the overall size of the Group being the aggregate values of the administered expenses and interest R37.9 R37.9 million 1976 R19.2 million interests in companies and the direct administered Trading profits of companies which became subsidiaries as a result of companies to about R5 600 million the merger amounted to % million The surplus on realisation of was announced on March 31 1978 that in order to finance Tongoing commitments the Corporation had made general investments afnointed to RT8.4 million 1976 R2 raise arrangements to Prospecting costs for the million 15 months amounted in R15,2 million 1976 R40 million at 10,5 cem by means of private placing of cumulative redeemable preference shares The shares which will R25 million taxation absorbed R17 million i : R4,6 million Ordinary Ordinary dividends totalling 45.25 cents a share were declared to the not carry conversion rights will have an average average life of about eight years 7 month pering compared with Anglo American Gold Tivestment Company Limited Amgold December 31 1976 earned net profits of R41.5 million in 1977 R3.9 million less than the v previous year Despite an improvement in the price of gold the sharp hast Rand OB L COMPANIES NET ASSET VALUES PROFITS EARNINGS AND DIVIDENDS OF THE MAJOR GROUP FINANCE Leyte 197778 Bullion 1976 anillian R195.3R1395.33 K473 R863 kis? OSES MLT FHSS RS42 KALA 06 Rele 1788127 8584.2 R44.1 6.9 17980.2 POTTS CODES 89.09 2013 40383,5 3116,0 189.1 sit 0-43,3 173 05 1976 cents 65.3 120.0 on RH4167 206,7 60,0 4382 7 US Dividends per ordinary share cents 1976 cents 33,0 60,0 40,0 _ C--fl3,5 40,0 50 3,57 165.0 180.0 70,0 65,0 600,0 410.0 USM2,0 2,0 ~~ March dh 1978 etfectietfecvtivelyeetfectilvely eytfectively in issau issau dinog the fifteen months standsonijn accounting for effectively controlled controlled companies following following 19 and the Haniton Company shares has ingan ingan be used reduce which holds United United and invest compacompanies nies becanic becanic the Corporation as a resuth of the book company the comings of American Industrial Corporation Corporation Limited Amickyere affected the continuing economic recession Net equity carnings fell by 5,5 per cent to R40,6 R40,6 million for the year ended December 31 1977 and earnings earnings per share share decreased from 160 cents to 151,1 cents because of the sharp decline in the markets for for timber and related products Since the year end discussions discussions have taken among producers in these industries which should result in return to profitability in the current veor In view that and together with the excellent results from Amic's major subsidi^ ries Boart international international Limited and Scaw MetalsMetals Limited and the improved income from its portfolio investments investments the final dividend was increased by five cents Total dividend for the year of 70 cents a share making significant The Corporation's investiment in the life assurance industry is held through Anglo American American Insurance Holdings Limited AATH which comprises African Eagle Life Assurance Society Limited Guarantee Life Assurance Rhodesia and Company Limited Southampton Assurance Company of Rhodesia Limited The rationalisation rationalisation prograimeintroduced since the Corporation Corporation control of the acquired companies assurance companies is now beginning to take effect Over the past 18 months AATH has successfully revised its new - business product range particularly with introduction of specialised products for Guarantee Life and an innovative pensions investiment vehicle which has been adopted by African Eagle Life Total assets of AAIH at March 31 1978 amounted to R717,3 million Compared with R650,8 million 181 months ago Premium income eet nevr,cate Directors Directors review US dollar growth has been same period satisfactory and reached 1974 million over the Anglo American Coal Cooperation Limited in Limited Anicoab reported a 50 improvement ended December 31 millich ions and group prejas profits to R74,7 million for the year Goal sales increased by 11 per cent to 25,7 turnover turnover at 259 million was 30,6 p^r ~ ent higher than in 1976. During the veau ^ lay equalisation policy was adopted by the coal mining subsidiary companies for major capital expenditure progiomes An An amount equivalent to the tax benefit arising from from income the projects major capital expenditure during and is then credited to incolle over voncerned R17 the year is set aside the estimated lives of was provided for tas equalisation during the year which which milion together with normal taxation R76 million resulted in a total tax charge for the year of R24.6 14 14 million Attribu^flable equity earnings R47,3 million with restated 1976 compared carnings carnings calculated on the same basis of R28,2 million and the annual dividend was increased increased by per cent to 60 cents a share Johannesburg The Corporation has 41 per cent interest in Con- solidated Investment Company Limited OCDOCD which holds a wide- portfolio of mining and industrial investments and which derives the major portion its revenue from from gold and diamond interests and platinum Hirough Limited which it adniinisters The Rustenburg Rustenburg Platinum Holdings gold and uranium producer The Randfontein Estates Gold Mining Company Witwatersrand Limited operated very satisfactorily and increased net earnings by 28 cent to R48 million in the year ended December 31 per was made on its million expansion 1977. Good progress programme initiated in Directors review 1977 December 22 1977 carbandiquaintenance basis Net SA BALANCE OF PAYMENTS PAYMENTS PAYMENTS PAYMENTS Expons and imports, the Corpora, in reased by 1978 Income taken profits on realisation profits of asbestos market profits hom Chanicals Chiversion of investments at market market fulllion to 287 million eceived in the Corperation Limitest was its holding ai reduced od Patim which hend International He finesian with 6,9 Hatuordinary losses amoamited to 34! share premium and million respectively respectively other investiments million related to in frend International amendincols to the production International has 17 per cent production Sharing interest with nwned nwned off agency and production No income was received by Minorco from 99,9 per cent interest in Zambia Copper Investments Limited ZCH ZCT's principal investNhanga are in Nhanga Nhanga Consolidated Consolidated Copper Mines Limited ( NCCM Consolidated Consolidated Mines Limted Limited READ and BRSI As result the xb, Continuing depressed state the Copper market both NCCM and Directors operating at a loss and the being reamed reamed in be 30 BRST possibility of dividend payments appears remote US million iniited Amican reported Decmber December 31 1977 > C83,9 millions or 50,39 offer extraordinary of 23,8 million of CS2.39 a share extraordinary gain arose die realisanen by associated edgpany Limited Saskatchewan Earrings benefited from against Investments lower exploratin expendiumes and increased profits Gas Limited decline in net interest securities trading Anican's including listed investments net asset CS93.1 to CS93.1 hover of cost or directors American Corporation Risia Limited Anglo American Corporation Minorco portfolio Net earnings increased from million in the to June 30 3977 processing chambanking interests flygt cement Colliers Rhodesian Nickel Mining Corporation now managed by Anglo Rhodesian Allows and Hippo Hippo Valley Existes in cinus agricultate forestry and timber pupperry mer do Brasil Limitada Ambrass holds a group of small Technical and operational Vello S.A. which operates a Horizonte in Minas Gerais improvemnts improvements well ended Jamian 31 1978 anda programme for gold substantial explotation Geulogia e also continuicnontignuing with Jacobina amriterions conglomerates in Bahia side have identified if is not these low tomatim tomatim Creserves can be viably mined prospective gold prices and the extent the higher grade tonnages indicated is curently currently being investigated The Corporation has a Australian Anglo American Limited which as conducting an extensive ^'xplo^fla prospecting programme Zealand and Fiji Australian cut interest in subsidiary Muild for Anglo deposits in Australia American holds 80 per Proprietary Limited Limited which recently operated Western Australia The mine nine at Nullagine in operations carly in 1978 follow- Gold and uranium Strong industrial demand continued The market price of gold during 1977 increased satisfactorily from a Jow in January of 129,40.to high in of November 168,15 168,15 closing in December at 164,95 and averaging 147,72 for the year an increase of 183 cent Since then the trend has continued with gold reaching a high of 190 at the afternoon fix on March 8 1978 reviewing the gold market the past 15 months ought to be considered in two phases the first from January to September when the price ose to and remained the 140- 150 level and the second from October to March wheff the price rose significantly In the first phase an equilibrium between industrial demand for gold and supply resulted in relative price stability with very little investment or speculation evident the second the impact of growing American interest in gold as an investment commodity particularly in the ligh the weakening dollar and the depressed state of Wall Street began to take effect A measure of this interest which affected other world markets was the during November traded volume on the New York Commodity Exchange when options totalling 18,49 million ounces were ; Since the end of the period under review there have been three funlier developments which will influence the market The United States Treasury announced that it planned to resume selling gold at the rate of 300 ounces a month for at least a six month peri^din attempt to balance the substantial imports of gold Into the United States first of these auctions was held on May 23 when the gold on offer auction was readily absorbed into the market The results of the with an average price of 180,38 can be considered be very Satisfactory Then India announced its plan to sell 70 tons of gold apparently Confiscated from smugglers to its internal market over a month period commencing in May The sales to date appear to have had diule impact as the Indian market is very restricted with reaching prices that are in no way related to those of the main centres very gold gold Finally the International Monetary Fund IMF announced that it was reducing its monthly auctions by an amount of 55 000 ounces from 525 000 470 000 ounces a month It is generally believed the reduction is accommodate those developing countries who under the terms of the IMF auctions can make competitive bids for gold Certain central banks can now deal bullion following the ratification of the revised IMF articles . Two of these developments have brought more gold on to the market while another has lessened the amount available Provided the strong industrial demand of the first quarter of the year continues the market should have little difficulty difficulty in absorbing the new supply Supplies of gold to the market during 1977 appear to have increased by approximately 10 per cent over the previous previous year to total of about 600 tons with South Africa the major supplier of 698,4 which which . oo foe + . ' P . . 4 : p Directors review tons and 14 tops Sold lower than in it expected Russia comminues be sitong first quarter 1978 when Lo69 million coins were sold beinagproximately approximately half the total sales made during 1977. Apart from industrial demand and official coin sales there was also speculativ^' buyinbugying particularly the latter part of 1977 and early 1978 though there there always a possibility that this gold may return to the market and so be a disruptive element be met met proportion of purposes It is strength and Though it had been hoped that the second amendment to the IMF articles would be rattled in 1977 this only took place early in April 1978. Consequently the South African Government revalued its gold holdings as at the end of March 1978 on April [ to 163 of, 162 3,7 27 the average of the last 10 London gold fixes less 10 cent and adjust the valite of its reserves end of each month on the same same basis This has two benefits the mines the clause under - the Mo^ambique Mo^ambique Convention whereby the mines had to remit their employees the official deferred price deferred pay in gold will fall away to the Mo^ambiqueGovernment at and the mines will now receive a market price for all their gold immediately it is sold to the : Reserve Bank Kitigemands record levels 10,8 cen As result South Africa's gold the last quarter compared with year Sales Continued be THE SOUTH AFRICAN GOLD MINING INDUSTRY The industry produced 697 013 kilograms of gold in 1977 which was 12099 kilograms or 17 per cent less than in 1976. Although average covery grade improyed fractionally from 9.21 grams to 9,22 grams on prodiction declined because tonnage milled decreased by 1.7 million totis to 74.5 million tons The average average gold price received in increased from the 1976 price of R3 367 a kilogram to R4 084 kilogram equivalent to approximately 146 an ounce 1976 121 While Harmony Gold Mining Company Limited no longer publishes its gold working cosis and prolits separately in the rest of the industry unit costs increased on average by R4,29 or 21,9 per cent to R23,84 ^ ton filled Working profits however rose R165,6 million or 18,6 perky , to 0544 0544 million while taxation and State's share of profits for the year absorbed an estimated R495.7 million of this profit for per cent compared with 44.3 cent in 1976 Capital expenditure on producing mines was R430.3 million as compared with R374,5 million in 1976. Dividend declarations totalled R338.7 million RT0.6 million more than for 1976 LABOUR . Labour relations were satisfactory during the month period Wage increases were less than previous years because of a national policy of restraint in an inflationary era The major issue among white employees concerned working hours Following negotiations for a day week the shift fortnight introduced in 1977 has been in operation for more than a year and its impact on production will be the subject of a second report by the Franzsen Commission to be submitted to the of Minist Lae bor ur and of Mines Initial experience by the mines is that there have been production losses and cost increases The supply of black labour which increasingly is from sources closer to the mines was better than in many previous years because of improved recruiting arrangements wage increases and continuing attention to living conditions The construction of houses for more . : ie " 17 i : t is i i t : a $ 7 . : i RUPE Bin bteea Directors review expansion of milling capacity Inflation has now boosted estimate to R20 million and will will be necessary unds probably during 1979 to complete the necessary to raise further further project Sinking delayed about two months by an accident the shaft on October October During Geduld 1977 the amalgamation of the lease areas of Free State Freddies Freddies was approved retrospectively retrospectively October 1976 In relinquishing its 50 per cent interest in Freddies Holdings LimitedLimited received 440.000 440.000 new shares in Free State profit Caphah anwounted to Of 10 a million teus ar ploduction over sudphuric acid and began in ploduction urbe problems loster than a Group an were encountered causing ipated and making necessary ammiinients for the end of September 10 on the performance continue Saaiplaas the maju estimated estimated belee the endof 1978 developinent developinent concertis the new fee at RS1 Directors Directors review KRUGERRAND SALES underground the No. char lperations lperations lperations of wilde was anllion is expected the end of the material shaft at Elandsrand Gold Mining Company Limited had been sunk to 1.933 metres while the reventilation reventilation reached its final depth of 2 195 melies on January 5 this year addition during 4079 metres of station R45.4 development and 162 metres of orepass raiseboring were completed the materials shalt complex and 1610 metres of station developr^-cat developr^-cat completed at the tock ventilation shaft Net expenditure on mining mining assets during the year amounted to R45.4 million and is estimated at schedule and an million in the current year The mine is well ahead of underwritten rights offer to members of Elandsrand was made in June 1978 raise approximately the estimated capital expenditure required to production ts mid 1979 R77 million to finance bring the mine ^finto At Vaal Reels Exploration and Mining Company Limited it was desided that operating management should have this greater responsibility very large complex where expenditure on working costs amounts to about R200 million a year and senior Corporation officials seconded to the company in operating management positions Ther There will be further changes during during 1978 to ensure effective use of the company's human resources resources and to provide greater decision- mine level The North and South amining divisions have beci Amalgamated Amalgamated into one and Nos 1and 2 shafts South are now identified as Nos 8 and 9 shafts respectively Faulting and uncertain Values continued the South lease area causing additional lower grade one to mined in Extensions to the present the East North lease to fill milling capacity and West uranium plants and the construction of the new South amanium plan~- have begun Commis- sioning dates have beeir advanced considerably to take advantage of the continuing strength of the uranium and is expand now planned expand treatment treatment plant capacity 40 000 tons a month in the second half 1979 a year sooner than scheduled The collar of No. shaft is complete and the concrete headgear constructed height With sinking now plained start in September shalt is expected to be commissioned ji 1983 hustel accommodate accommodate 6.000 6.000 men is continuing Buikling to its 1978. of the final The new At Western Deep Levels Limited an underground fire broke out in June 1977 in one of the highest grade areas of the mine making it necessary to expand production from lower grade sections Work is -continuing on the tentiary vertical systents at both Nos 2 and 3. shafts allow mining operations below the 100 level to expand However the high stress associated with such depths emailing costly support of haulages is restricting the rate of advance The new hostel complex is now filly occupied and older hostels are being upgraded Construction his started new village for senior black married employees and their families which is be shared with Elandsrand Gold Mining Company Last Rand Gold and Uranium Company Limited ( Ergo produced its first uranium on February 25 1978 only two years after the decision to ahead with the project to recover gold and uranium and to produce sulphuric acid from old slimes danis The million project is shortly expected achieve its planned reclamation rate of 1,5 million tons of slimes a month Initially annual production should be about Directors review 000 000 dirars small high on the production during year consisting quality semIS kilograms sulphuric acid of which treatment precesses gold 200 tons of uranium 000 tons will be required In July last year made and 000 tons of required for higo's own an offer of 16 million negotiations until talks with Government on various aspects of the project are concluded and the feasibility study has been reviewed sides at R3,50 share of which 250,000 250,000 shares were firm certain subscriptions subscriptions by certain companies and financial institutions When the offer closed on July 20 apaplications plications totalling R286 million had been received a record for a South African share issue and the 3.750 shares offered the public were eighteeth and half times subscribed subscribed Since the inception from the issue issue equity of the company the net proceeds capital amounted to R114.8 million availmillion with the balance of Hinds for Erge's capital expenditure being provided by revolving credit facilities and short term borrowings borrowings In November received the Rand Daily Mail's Mail's Business Achievement Award for 1977 in recognition recognition of its pioneering technik.al accomplishments accomplishments and SAFETY The reportable accident rate per thousand employees per annum in service on the gold itines of the Group fell by 1,58 from 45,05 to 43,47 while the fatality rate remained virtually static at 1,29 The Group Chairman's Safety Shield was won by Free State Geduld for the second time while the of ChambMe inr es Millionaire Shield was won by Vaal Reefs North for the fifth time This major award which is presented to mine on completing a million consecutive fatality shifts was also won by Freddies for the second time shortly before its amalgamation with Free State Geduld Its contribution to the The South Africants terminated undergroun recover gold from intention to do so developm^'m Africants the South Alican economy All Company Limited which undergroun ne end of 1976. continued continued to rock dumps in the East Rand grea and the as long is paptitable Meanwhile Meanwhile initial The detailed operating results of gold mines administered by Anglo American Corporation and these in which the Group holds a significant interest are given on pages 84 88 , have been obtained of the two exploratory south and south intersected walkings The reef was but the stades have beein Diamonds disappointing expected during Holes Holes holes and further results whether to embark on further Sales reach a new record -East Daggafontein underground mining mining its gold treatment able items Substantial arrangements entered imo in able assets However similar bulk of such assers have now subsequently made subsequently plant equipment equipment to self equipment and salvage- salvage- income was received from certain royalty 1977 , as wellashoin wellashoin the disposal of sales results are not expected to recur as the Sales of rough gem and industrial diamonds by the Central Selling Organisation CSO during 1977 reached new record of USS2 073 million of 803 million an increase of 33 per cent compared with the previous year Prices raised an overall 8.75 per cent in 1976 were father increased by 15 per cem March 1977 and by 17 per cent December The market which had been characterised during most of 1976 by demand particularly for the smaller sizes and the cheaper qualities of large diamonds strengthened further over the During 197 -couise of the year By the end of 1977 an imprecedented demand had developed developed for all qualities of goods despite the price increases the Although sale to the cutting centres of more car^tsthan ever before Primarily construction this was because of excellent trading conditions for diamond jewellery programmes programmes for mulear the uncertainy the retail level particularly in the United States of uranium supplies fromfrom and Australia lent support the response to the CSO's seen partly in- market as did the United insistence that world wide advertising efforts However during conditions of sale should apply to ajanium ajanium the latter part of the year a measure of speculative trading in the Group gold mines have been well placed placed to take advantage of the sutting centres and of general investment interest in diamonds as a stote of value also began to influence overall demand In the first Strong oranium market with production rising by 32,9 per cein to months of 1978 when the 533 tons the increase being largely hom the JMS At Vaal Reefs the effect of the December increase could not yet have filtered through to the retail stores this resulted in premiums well increase in teatment capacity from 335.000 335.000 tons to 720,000 tons a in excess of the CSO Jhonth is now expected to come into operation the second half prices being paid for rough diamonds in the 1979.The detailed of secondary markets At the same time it became apparent that the bank feasibility study and the pilot testwork for The credit which was being used to finance in the Atikander Lease Limited pproject roject were completed during 1977. 197. There some of it based cutting centres during is however concern over the on ruling premium prices was reaching proportions L continuing inflation of capital and which in the event of any market dow turn working costs This could affect the viability of the mine which unlike liquidity problems To could cause severe other South mines would not counteract this situation and to enable the African produce uranian as by- product of gold As result it has been decided to delay a decision on producers to benefit from the premiums being paid the CSO in March This year introduced ^ variable the establishment of a mine an surcharge to the normal list prices of decison temporarily to suspend sales diamonds it offers for sale The surcharge at rate to be determined at yaie cia i achievert achievert Purchasing and Subsidiary Judong from other received rose R16 million R55 million Consolidated million share of R368 million profits which which had higher higher than risen by Roft during 1977 ashae 1976 35 cents and a mul of R312 transferred to reserves The blue at million R221 million while to 3502 million 1976 and AfiaNamibia Botswana Beek gong in South Africa and Testhe amounted Cotapared with 345 921 carars in 1976 increase amounting about 12 per cent were except rapa than 1976. The new where where this recovery recovery Lethakane Lethakane mine Beers Bowena Mining Company was commissioned at the end of protisceprotdisced 34345 5 981 ca a yduring the year The Leiseng Leiseng Lesotho also maghed maghed till production during the year Production hoan the Kimberley Division cent from Namaqualand by per cein Division from and from Consolistated Diamond reagi level level level i shares the Years expendinite programmes were progress within the initiated Beers group which with others recently initiated will bring about substantial increas increase in productive capacity Construction work at the Koingnaas ming in Nainaqualand is nearing completion and production at the hate of approximately 500 000 carats a year is expected to start in the middle of 1978. The small Langhoogte mine ako in Namaqualand Namaqualand will start producing af the rate of some 60.000 60.000 KIDDIAMOND KIDDIAMOND fa 4a. Directors reviel mine from 2,35 million to the ended 19718978 while production to increase by about 25 cent when gravels to the Kimberlite pipe has been teached with the development of an important important new the county where a major Nalahan sediments to depth of 30 to 50 i 500 into commercial production in 1982 3.5 million v^/rnsa year rising to'six important progress was made toms of racial discrimination within group A comprehensive programme of mines in South Africa and Soutli West resulted all in the taces introduction in being introduction of an integrated integrated wage the Kimberley Division the limited to those whom an provide contioning employment Agieemene has authorites authorities fou the establishment of financially schemes for black employees in Kimberley AL.COM AL.COM the families of the first Ovambo be housed at Oranjemund arrived during the nagin facilities throughout the group's mines avotu and improved Following the introduction of a fives week for mining sector in the Kimberley Division in tirse an angementswere extended to artisans on the mines in December 1977 and were introduced for the sectoral sectoral Premier in February 1978 anticipation constitutional constitutional and ppolitcalolitical political changes in South West office of CDM wavinoved wavinoved from Kimberley to the De Beeis Diamond Research Laboratory during the year Attention continued to be efficiencies of mine recovery plants and to improved recovery methods and in March new small plant plant was comunissioned at Finschi mine the handlinogf sizes of concentrates concentrates response to the trend towards greater use of diamonds in industrial processes a variety of new synthetic was developed SPAFOOs SPAFOOs for use in specialised sawing and Jiffing applications has been added to the range of synthetic produced by De Beets The application testing of another of products SY DITE Uinting tools is being pursued The production of CDAL an elongated diamond grit particle for use in Gesin bond dinding wheels hegan at Springs in the Transvaal and an equally resin bond grit for the dry grinding of carbide.called carbide.called CDA M Bo shows considerable commercial promise De Beers group are given on pages 88 25 Exports build up through Richards Richards Richards well with the first coal expected to be produced as the end of 1978 1978 and the total cost remaining within the of R109 million in 1976 money When the mine in full production in 1983 it will provide the two million tons a year of apots which Ancoal has been granted firm Government Government Authority under the Phase 2 export programme In total Amcoal was granted provisional MOIN Amcoal the propose best provisional permission to export live million tons a year for 20 will this be emitled to export three million tons'a tons'a year ! Phase Saprogramme and is accordingly investigating which produce the additional coal Commission Escop Escop in Group coffieries to the indicised by 14 million Electricty Supply tons because of the build at Kriel which supplies the K iel K iel power station underground mine produced 2,7 million tons in 1977 and to the planned annual rate of four million tons during stream diversion for the opencast mine was successfullsuc eys ful y early in 1978 and coaling commrienced in the second a power station will ultimately + nse 8,5 million million tonosf fram the undergrouanndd opencast mines SOUTH AFRICAN MH oaditysh depressed Ani Hite top while anones Group collieries tonition tonition mocased 1976 owing Working leg containing containing them Group's major goal isopony Lifed ( Amicoult ap 31 cent 1976 1976 were attention is being Chaal Corpora pugress in 1977 million 50 per cent cashained the substantial Terios . programine RISE RISE million in presem devlopment Aminal's new Kleinkope mine is 26 Directors Directors ReAHON docess ramp deft the Middelplaats Middelplaats Manganese Manganese Initialdeliveries this R47 million 1979 most which will be for export Annot Colliery iltan expected consumption with Transval Transvaal Coal owners owners owners to Escom has had to full stockpiles stockpiles and lower lower progress has been spebeassptebeast intake collieries Bank and improved washing operated vields of 4,4 million Association exports of of 8.6 million reported manginaly lower trading conditions in the coke Colliery Limited improved improved earnings earnings following successful enerations group expou fieu Limited isop operations operations is being billion a stoning tous reserves for al coal Other mining Copper price prospects not encouraging through Prices in the world copper market declined steadily 1977 and the tits quarter of 1978 reflecting the absence of any significant recovery recovery in the coomonties of major trading nations and the existence of record surplus stocks At the beginning of 1977 the London Metal Exchange improving gLMB copper price was 795 ton or 61 US cents a pound briefly in March 1977 to over 900 mainly because of an expected mid year strike over wage negotiations in the American copper mining industry Settlement Settlement of the dispute was reached without any significant stoppages and prices on the LME and in the United States returned to their downward trend stocks By the end of 1977 the LME price stood at 666 while LME increased during the 12 months from 603 000 tons to 641.000 641.000 tons and total western world stocks increased more than two million tons In the first quaiter of 1978 the price declined further reaching a low point of fold in February and at March 31 the price had risen 4.696 2 top again to equivalent to 60 US pound LME stocks at that date Totalled 575 000 tons the next blycky in Transvaat goal hicrests in the Group will notwithstanding notwithstanding dittion loup participation in the are good prospects for particularly of power station in Rhodesia chal year ended while toke August sales at previous year the 11 1977-3 ook ! ions Collier company Fiiited to the 119 pd cent to 197.0 197.090 j^ns were marginally less than in the 85147 000 to 216216 million egits la share Although satisfactory satisfactory the lower sales level piovided for supply pricing Shortfall on protits amonaging during the current year ifa price were to be implemented porarily suspended and thigComp Increase the price all customers fell short of the with the Goverment for the terms terms of the agreement the million would be recovered increase increase of more than 20 per cent agreement hoifever has been tein- agreed thigComp to a 10 per cent and dose and sho Prospects of an improvement in the copper market during the next montis are not encouraging There are indications of worth- 3 a while increase in world consumption so aby alleviation must come from a reduction of Supply Although countries affiliated to the Inter- national Council at Copper Exporting Countries Cipec failed to 1977 agr^'^i'n December on round cutbacks in production Zambia February Za^flre azad Perni in 1978 joinly announced reduce by 15 per their proposals to supply of copper as soon as possible Shortly therealier Zambia announced a 15 cutback per cent force majeure on contracted deliveries of copper until December 1978. 11 will however take soine tinte before the effects ofthese decisions be gauged including the disruptions of can supplies of copper resulting from the invasion in May 1978 of the Shaba province of Za^flreby anti- Government forces The main difficulties surrounding the Group's Zambian gemain investments unchanged The effects of lower prices and increased Choanvseollieddatt edo position where the two mining companies Nchacnosgtas Copper Mines Limited NCCM and Roan Consolidated Mines Limited RCM a brief ate incurring return to profitability in 1976/77 substantial losses operations have been hindered of by severe shortages skilled staff to a lesser shortages components components through lack of foreign extent by of closure of the exchange With the continued Benguela railway outlet to Lobito Zambia's mining industry has had to rely heavily on the congested port of Dar Salaam leading at times to a build of copper stocks export Liquidity is a serious problem and the awaiting substantial companies are receiving temporary loans from the Bank of Zambia NCCM produced 407978 tons of finished compared with with 226 tons the copper during previous year RCM's 250 509 tons against 289 960 ions in 1976 output 1977 was Diretors Diretors review holds principaplrincipal asset the nes Limited reported consolidated w the year ended Holdings Limited which of Rustenburg Platinum profits after tax of 84.6 84.6 million an interim dividend 2.5 Hudbay's canings Contributions to tax operating profit for the Year were 3.1 per cent from base metals 33.2 per cent front fertilizers and chemicals 62.4 cent from oil and gas and 1,3 per Sent from industry wo new mines were brought into production at the earnings in 1977 did no allow company's base metal operation in the Flin Snow Lake area in : i profitsgare not comparable with the profits outhern Manitoba and work was started on new 26 million L the company in 1976 as the basis of concentrator near Snow Lake had two respects respects which had the effect Hudbay's oil and gas investments represented by its 61.9 per cent achieved Rustenburg group companies achieved slightly interest in Canadian Merrill and its 54.9 per cent interest in Francana a Sgust 11 1977 difficult marker conditions than in the previous conditions with the price of in which in turn owns 56,8 per cent of Trend International Limited all reported higher net earnings flowing from higher product prices Stop ounce September 1976 aud increased production and improved access to markets Canadian These unduly low prices Merrill's net earnings for the year to June 1977 were 3.6 million or capital and working costs CS1.72 a share compared with with C million or CS0,99 a share in 1976 position In addition and in the six to DecemDeb cee mbr er 1977 net earnings at CS1.7 million z in production of between 10 and The capital expenditure or 80.70 80.70 a share were marginally marginally higher than in the corresponding period in 1976 before an extraordinary gain of 349 000 in 1976 was also reduced Francana had consolidated net earnings in 1977 of CS9,9 million or C production Coincided with a sliare comparogwith a joss includinagn extraordinary item million or CS2.53 a share in 1976. All three companies market market price rose restocking restocking by from about 170 an 220 be the erad of jammary 1978 and toa Rustenburg was able to raise its own continued their explotation and development development programmes in 1977 with Hancana making a significant heavy oil and gas discovery in Saskatchewa and Canadian Merrill expanding materially its gas Reserves in Colorado price for platinum US 8740 on June S. Its progresively from palladian price January 25 to 1570 an ounce ounce Negotiations place to redress the losses that the company incurring on platingoy sales of the automotive automotive industry and steps have been initiated to bring level of production close to the current level sales Rustenburg's six months to February no interim dividend was Terra Chemicals Kent interest 19761976 carttings a a Chemicals International Inc. in which Hudbay has 50,5 per carned USSS million or 1,27 a share compared with carttings of 12 million or 2,03 a share This decline was caused mainly by weak fertilizer prices in the United States together with the rising price of natural gas the principal raw material for the production of gend's nitrogen pr^ducts The new ammonia plant in Oklahoma in which Terra lias a 25 per interest is now in full Hudson Bay consolidated consolidated carnings reported million on 050444 million ES3,20 extraordinary gain sale of Hudbay's polasta figures for 1976 wei~ y before extraordinary charges of CS1 Pb millions or include include HalbaHalbay's ysh'ars ed earnings tran eqquins basis of effectively controlled include 2.3 millionnepiesemingountcalised translation into Canadian The consolidated results lenses which are accounted for controlled companies The results also millionnepiesemingountcalised exchange gains on the of United States subsidiaries accounts H^...dbay passed its pavuier's pavuier's and the total distribution third- and tounili quarterly dividend for 1977 amounted to 60 cents a share coipared coiipared with 80 cents in 1976. The improvenient in 1977 earnings before extraordinary items stemmied stemmied largely from the better subsidiaries Francona Oil Gas Limited and Canufian increased production and Merrill Limited which benefited from higher product prices This was offset to extent by the contiming weakness in micial and fertilizer markets which together with increased | costs adversely affected production and nearby upgrading plant in which Terra has a 65 per cent interest is the final stages of construction and is expected to begii production early in 1978. Terra's planned expansion to the south and south west progressed finrther through the acquisition of most of the assets of Riverside Chemical Company which has blending and distribution centres focated mainly in the southern states of the USA Inspiration Consolidated Copper Company recorded a loss for the year ended December 31 1977 of USSTLE USSTLE million compared with a profit of 126.000 for 1976. The main factors responsible for this loss were weak copper prices low demand and a strike during July and August Dividends the year were reduced by 30 cents 20 cents share Deliveries of copper were marginally higher than the previous year at 90,9 million pounds but this was more than offset by the fall in the average price from 6948 cents a pound in 1976 to 66,84 cents in 1977 when the entire US copper industry experienced one of its worst years since the early 1930s with demand for domestic copper dropping substantially and lower copper being imported The competitive position of US producers was further weakened by costly wage seulements in 1977 The equity earnings of The Messina Transvaal Development Company Limited fell sharply from R13,9 million in the previous year 30 Directors review world economic South Africa which the The Messina group's industrial industrial subsidiaries financial Phikwe in Botswana significam interest though was was this decrease prevailing adversely affected stain mine an Selebi which the Group has Himited ) RSD was nickel and an operating closed during puposes A record following six expected to continue at the to increase increase are int your The conduded on March To this Investment Investment section of adversely affected by the prevailing low demand for and arket price of zinc Betal Finland Wolfiam Limited reported a r^'cord pre profit of 4.5 million to 1977 compared with 2,6 million in the previous year This increase was mainly a result of firm woltram prices which more than offset a decline in the volume of concentrate produced and sold by the Portuguese operating company Swaziland Iron Ore Development Company Limited continued to supply medium grade ore to certain Japanese steel mills The company i] = SELECTED Copper woe METAL PRICES ON OPEN MARKETS Es ; because million million the previous previous year of the company's company's heavy loam old nickel market absorbing R million com dividend was indebtedness and the final dividend of 000. Disidends for share and absorbed Jomplex geology of apost Chemical LimitLimted ed Limited posed development of the Kingdom which is and its associates and The increased ise of continuous continuous Carying potasis horizontal digmented knowledge allowed more of around onningeperations ProdProi diictii on hc astrevei rfly ro even rfly 50 000 of tons product ^ mon vent interest and Anglo American Corpora Tara its Exploratism Exploratism and Development subsidiary Tara Mines operates Navan the Republic of if name was USS154 million 1842 Ireland The capitcaolst it has a designed capacity produce 500 000 short tons and zinc concentiates a year to 2.5 million tons of ore Production Production started in June 1977 and although labour untest delayed des clopment programme in production in 1978 proceeding satisfactorily satisfactorily However Kaja Directors review western corner only the increased price gold prompted herther investigation \ tons annually and loading company Although the ore reserve in December 1977. Heaunent of the result of poor railway and port services services continues accumulated Manganese Fimited mine in the never never production constricticoonstrniction constriction of performance subsumon Propietar Industry Industry and commerce #Cost pressure hardly reduced 32 sectors the company pro economic cuts domestic expenditure foodstufffosdstuf s Durable consumer goods were affected to an even greater extent with car sales in particular falling below the depressed levelosf the previous years Investment activity declined drastically because industrialists in virtually all areas found themselves with growing excess capacity and #because public sector investment spending was reduced sharply -partly to conform with Government policy and partly as result of a number of major projects having reached completion In these circumstances should reflect it was hardly surprising that manufacturing output the largest decline experienced in more than three decades decades However some relief to this generally adverse environment was provided by an exceptional agricultural season reasonably favourable results in the mining sector and to lesser extent continued spending some public sector projects Certain industries notably those producing chemicals and various work anetal products and to some extem the demand for contract benefited from these developments In sumf^ instances exports also maintained , volumes particularly sales of processed and semi- puicessed reflected reflected reflcted iron and steel Elsewhere the drop in domestic Elsewhere however output more accurately demand with manufacturers of electrical machinery and appliances transport equipment and timber being noteworthy examples wages Despite slack demand demand and slower rate of increase in average cost pressures were hardly reduced mainly because of con- tinned increases in administered prices This was clearly reflected in d^'pressedaverage prolit levels and in the growing number of unem- ployed a problem of extremely serious proportions The urgent need l tgrowth to combat the problem of unemployment in particular h^s prompted gradual only moderate relaxation of policy measures the absence of further s^...njlar steps which hinge on balance of paymems developmeats only a marginal improvement in industrial and commercial activity can be expected The investments of the Corporation and its associated finance compaines in industry and commerce cover a wide range of activities including iton sieel alloys chemicals and explosives civil engineerand construction drilling tools refractory and other structural clay pproducts roducts textiles plastics paerboard paperboard paperboard timber including wattle including extract for the feather Industrial equipment agricultural products and foodstuffs motor vehicles and components rail loco- motives and coaches shipping forwarding and clearing and computer . sentives The Group has a wide spread of industrial interests in South Africa both directly and through its investments in Amic De Beers Industrial Corporation Limited Debincor and Mainstraat Beleggings 1965 Eiendoms Beperk Debinc^r holds a substantial interest in AECI Limited the major chemicals and explosives manufacturer The Group's Limited investments in Highveld and through Amic In Steel Scaw and Vanadium Corporation Metals Limited and Boart International Limited are complemented by its joint interest with the Federaly Mynbou Mining group in Mainstraat which also h^lds several major investments in the steel and heavy engineering Directors review sector He G Rhodesia through in Zambia Zambia though IRON STEELAND ENGINEERING Highveld reported improved industrial interests in : Limitedaa nnd d as weli impous 4 This encourageencdouraged industialised in haver world and protectioniprostecttionist South Africa Juvement in the of plate mill section the beal domestic reductioat reductioat prescar anuncial anuncial bullitanis Directors review action action action Union principal construction drilling division of the scant Amic rationalised overseas expan results in where where a depressed state The well particularly in In Austalia where Board's rorganised acceptable profits were trading conditions aurency aurency movements movements R16 million in 1976 not in PROFILE OF EXPORTS reduced anders the satisfactory lesel activity and Although there te holled sted exports an acceptable level of grinding media depressed state of the constriction constriction and lalattest est demand for polled steel price prices competitive decidcitdecyidcity de rte contands but recently announced essential services and com Although Stewarts & have 14.7 per his by op pericent pericent 1937. Equity comings Louth of South Africa Limited and increased Railways received a R60 passenger osadies osadies 87 the milioander in November over placed by acontatives acontatives ordinary sharehshareolds olders of a subsidiary of Arncoal increased slightly 311977. 311977. This increase Covesland Covesland Roof Tiles Pipes Limited which operate in the building sector Increased exports of chromite andalusite and refractories Together with improved | efficiencies resulted in nei operating incont^'of the refractories and mining divisi^ns improving by 38.6 per cent over the 1976 figures No significant upturn is expected in 1978 and resufl ortths is group should be similar to 1977 CIVIL AND ENGINEERING ENGINEERING CONSTRUCTION Equity the ETA Limited group for the ended March 31 1977 were 85,4 million compared with R5,2 million the previous financial year Earnings Earnings were 4 cents a share as against 40 cents Work in haid at March 31 1977 was valued at R271 million compared with million the previous year The dividend was maintained at 18.5 cents share For the six months to September 1977 equity cathings were R3.2 million compared with R3,1 million for the same period in 1976 Earnings were 26 cents a share as against 23 cents Work in hand at Septemfic 30 1977 was valued at R298 million is expected that results for the 12 months ended March 31 4978 will be similar to thoofste he previous financial year TIMBER AND ALLIED INTERST INTERESTS . Mondi Paper Company Limited the equity capital of which is held by the Group Debincor and JCI and manufactures markets a wide variety of 35 Directors review groundwood groundwood , finishingdadlity finishingdadlity consolidated major subsidiary , South African Merchank paer speed machines ant earnings of Mondi Mills Mills Limited rose from This increase was achieved achieved South Africa the raw materials and Siderably comings were R10,2 expected that the the current Industries Limited had an Safb and its two and Peak carnings trofe lower saga cand of new from with penetration although profits some the company's endoms R392 ka the profit of R2,5 million This com resulted in discussions discussions ink Limited Abob enthief.chipboard enthieff.chipboard MOTOR AND TRANSPORT TRANSPORT Sigma Motor Corporation Corporation mading quar in penetration December December the the wy market ever . SigmapiprovSigmaepiprodved its 14 per cent in months of LE light commercial cent 1976 Livision's perfor loss was higher Begotiations mainly expenditure weakened the market pi ision the Equipment and Truck pi ision operates This division Galant market expected organised and results are expected to improve significantly significantly the introduction of two winning cars the Colt and Mazda 323 Sigma is in a sound position to improve its share and to maintain its positiongas a major force in the motor industry McCartl~-y Group Limited is the largest retail motor organisation in South Africa comprising various companies marketing particular vehicle franchises for specific areas The group's unit sales of new year cats and commercial vehicles declined by 30 ended June 30 1977 yet tepresented 12.1 per cent Republic Highly competitive trading conditions per cent for the of total sales in reduced gross unii margins and this together with the drop in volume was responsible for the decline of R2,3 million in ner equity earnings to R16 million for year : The activities of the Freight Services Holdings Limited_group Limited_group include clearing and forwarding buying and confirming ships agency and the servicing servicing of ships a compr^'hensivetravel service and wany ancillary services related to moving moving goods and people both nationally and = internationally internationally As anticipated the downturn in imports continued during 1977 but by reacting timeously to market and economic conditions the group increased earnings to R4,6 million The group's interest in South African Container Depots Proprietary which operates the sole ctistonis entranchised container depot in South Africa is expected to contribute considerably EXPLOSIVES i Limited achieved an increase in group sales of R157,8 R157,8 million in or 36,5 per cent to R590,2 million while not equity earnings 18.5 per cent to R37,2 million The results of South African Nyi nSpinnets Spinnets Proprietary Limited which became wholly owned subsidiary on January ( 1977 are included in the above figures for The higher profits were largely the result of the improved performance particularly in The second half Modder- the year of the company's based armonia plani at fontein Where following the resolutionarmoniaof technical problems otput otput and efficiencies jose significantly TheLt volume of sales in the Republic of South Africa was only slightlyhigher in 1977 than in 1976 but the level of business activity improved most sectoofrts he company's operations during the second half of year The R230- joint million Coalplex project a undertaking in which AECI has a 60 per cent interest and Sentrachem Limited per cent was- commissioned during 1977. The plant is producing polyvinyl chloride PVC carbi^ acetylene chlorine and caustic soda The production cost of colupares favourably with the cost of producing this material from imported oil Notwithstanding the lower than expected d^'mandfor Coalpka products as result of depressed conditionsin The South African ecol^flomythe project which is based on coal has exceptional long potential : a The Chemical Holdings Limited group manufactures and markets wide range of formulated and other chemicals for industrial Directors TONEW turnover turnover rose by cent The Tongaat Group Limited's net equity earnings for the year ended March were R10.2 milhon an increase of 20.7 per cent over the previous year This eighth consecutive profit increase was a consider- achievement achievement the face of difficult trading conditions in most of the sectors which that group Operates Despite record production recovete the division's net contribution was lower as was 4 ah materials division division while the foods and feeds again increased increased profits The new Aplement which came into force on January 1 poticularly favourable for South Africa but the industry greater stability will allord Finited which conducts extensive meat and dairy basiness in thi^ Republic and in Swaziland again made February 28 1977. Earnings per creased Har from 193.6 cents while dividends were i 14 cents the 56 cents is anticipated anticipated that the results for financial year will show further improvement improvement with increasing esports liet Swaziland particularly h^pelut other season was beset growers and processors with difficulties for RFF of deciduous fruit in the Cape Excessive Jains and a highly unseasonal lack of redited size and quality of peachi and pear crops and depresed state of principal export markets selling tease Margins were further reduced by a continuing operating costs The unfavourable weather also affected grape crop and the company's new winery suffered from teething problems which however have now been resolved Fortunately international market for puid fruit juice concentrates was ceptionally strong Although the juice plan made significant contribution contribution to incoine REFF incurred a loss of R186 000 the year to the die Group a successful law 1974 TWO cashew processing companies Movila S.A.R.L. S.A.R.L. and its subsidiary Antenes ve in 1977. Despite severe shortages of materials and despite yields and quality levels the two companies camed profits bar were unable to resume dividend exchange control regulations Projeistave fimited mandactures various industrial textiles rubber and other industries and spins Colton and synitione vars and the mote demand demand for As a result of the economic recession in general industry in paniculaz i lf^"re i lf^"re was substantial dedine the company's products including those of its subsidiary Dnion Cotton Mills Proprietary Limited which operates a Vandengind Vandengind weaving plant in coffequence coffequence consolidated net eamings year ended June 30 1977 declined by 25 per cent 16 R1,5 Science Pioprietary Limited a leading supplier of and equipment the South African data processing + its earnings in 1977. Increased recognition of Directors review Computer Sciences resulting marketing company company and a strong emphasis year'syear's residis and the company owned owned services viroug months ended September 30 19761.976. In view of the company's overall financial position ne dividend has been declared for the is mourlis Sotec has now concluded its extensive building programme started in 496 with the completion of Life Centie in the new Stock Braamfontely Exchange area Total House in and the remodelled and espangal Killarney Mall all in Johannesburg and Shell House in Cape Town During the period under review Wesbank House was sold and arrangements between between Sanlam and the Sorec group in relation to The Sa^-so group companies were terminated Although the shop and office markets in all major centres in South Alrigh are heavily oversupplied 96 per cem of the 775 square indres of shops and 84 per cent of the 380 291 square metres of offices managed by Agglo American Propzity Services for the Group were let at competitive competitive rentals with reasonable tental growth assured through the negotiation satisfactory escalation rates for all leases concluded In the short term the property groups'will groups'will not reflect substantial increases in profits as long as interest rates remain high rentals and land selling prices continue to be eroded suplus space is available ^fin - all area the market and costs continue to rise property companies administered within the Group and those which the Group holds a givention ping 1000 Limited Creative Haited Amapupureported Amapupureported R16540 R16540 compared Terrased additional defennnes The ' not eatings Corporation Corporation Computation Proprietary | Exploration and research owns midis idends livaers it industrial township land Marina da famadevelopment over alle previous previous you with year The owned difficili and operates the Carlton Centre com Carlton Hotel a major Carlton 30 June and for R14 March molded molded with R2 milhoa for the Emphasis on search for uranium continues Exploration for a wide range of base metals and uranium continued in South Africa South West Namibia and in many other parts of the world with a significant proportion of total prospecting expendituirne southern Africa devoted to the search for uranium Results from investigation of secondary uranium deposit in the north western Cape have been encomaging and further drilling and metalltagical work is proceeding while in the Karoo the joint investigation foruranium with Empresa Nacional del Uranio S.A. the Spanish nuclear fuel company continues the Namib Desert near Swakopmund South West Namibia large but low grade secondary uranium d^'positsare being examined in conjunction with Minatome Omitaramines and Union Corporation Limited Several base metal prospects were examined and drilled at a number of places in the Transvaal Cape Province and South West Namibia Initial indications in some cases have been sufficiently promising warrant f^...rther examination and a new copper discovery in southern South West AfricaNamibia is of particular interest In June 1977 the Corporation entered into an agreement with Newmont Mining Corporation and OokiepCopper Company Limited to acquire 45 cent interest the Gamsberg lead deposit As result of feasibility study the partners decided not to develop the 41 Directors gold seath of the Canarieries mine at lacobina in the state of Bahia Brazil s ss far ' . x 2 three billion tous option by main comphases consolidation Einmalavourazbilnec market market geological and metallurgical werk on companies within properties and Bee State yielded obtained Significan obtained in various reels south laahe drilling will have to ber the potential the area west the Vaal Reefs mine for maniom north klerksdorp klerksdorp infications to warani warani continuing to resurm esue me in block soutiotf dues were obtained wiled in disclose disclose any accade has resulted reserve additional an paachased white he nights to further parth prince and field with historicallheyld mine billion totas continued to be on previously dhaoveted expansion into new Meas Ambras Ambras is conducting substantial explotation for gold and base metals though Unigen Geologia e Minera^^So.A. Thiscompany is caise continuing with feasibility studies of the Jacobin~ auriferous conglomerates in the state of Bahia Although substantiaftonnages substantiaftonnages of goki goki ore have been identified is not yet possible to determine who hen these low- to medium reserve can be economically at prospective gold prices and the extent of indicated higher higher minedtonnages is now being investigated investigated Charter Consolidated Limited has continued prospecting pro- grammes in Ireland Spain and France mainly for base metal and fungsich minerals which Charter has been awarded a in the U.K. North Sea a group of companies in slightly more than an eight per cent interest has round licence over two adjacent blocks in the Moray Firth region One block has also been retained from the fourth round licence held by group which Charter has ^ 25 per cent interest Charter also participates in the exploration programmes of Australian Anglo American and Ambras foiut exploration in Canada between between Anglo American Corporation 64 Canada Limited and Hudson Bay Exploration and Development certain Company imited Quched and in Bay continued in British Columbia Yuken Ontario aranim prospect arch in Saskatchewan byploration expl^ted to own account in Manitoba the south westent westent United States Frend Esploration Limitest continued and the Frated States Canadian Canadian drilling both in Canada oil exploration in Indonesia Merrill Finuted participated in und GasLimited was invaded was image of heavy SandancheGD SandancheGD SandancheGD oil and was Explorativan CompanieCompsanies in Group has Southern Africa maintained Australia Papia New dishtier dishtier of Western adivifies Fimited was active Kimberley copper deposit thailand Other prospects Australia Rid Hun Austi38 Linned investigated Zealand Duing 1977 CRA CRA pointed by Lasmania Consolidated Australian Australian Anglo Ameucan Premsad investigating the Namosi perplivapeyrplivay copper Teverse chalation equipment out during the year with encouraging results Early CRA exercised their option to can their respective telests of the join venture and a second phase of work which includes includes Maited Other Unvestigations Exploration in Fiji located located base metal metallurgical and engineering mineralisation Anglo Padilic mineralisation which is engineering Padilic being Inaher investigated investigated In Brazil Anglo American de Brasil Timmada RESEARCH The American Research Laboratories in concentfald concentfald en gold and gramines were contined on manium reckers and signifikant pronatiated on various aspects # the Joint Metallurgical Scheme MS in Hie Orange Free State Ergo the East Rand ability and A considerable amount amount of work was also de -^o e n amenfeasibility resting of Afrikander Lease ores the field of amanium extraction substantial work has be n alsobeen carried out non Witwaterstand Witwaterstand series ares all cases the amenability of these to one or iiore of the wide range of extraction extraction processes developed over the years has been demonstrated Antention has also been paid to large scale plant resting of the use activated carbon in gold and uranium circuits with considerable s^"ccess sparticularly for gold recovery Hie Corporation holds certain relevant patents and arrange- ments are in hand for the manufacture of the carbour materials through The Natal Tam- ExtractCompany Limited Furth~i pregress has been made in the production process of supergrade magnesium oxide and patent protection has been obtained Advantages Advantages include the ability to process low grade materials as well as to provide substantially improved environmental conditions compared other processes in use Some work has been carried out on the extraction of metal values from undersea manganes^nodules Directors review and also the of ungsten from grade ores number of other base metal programmes has continued particularly particularly on Southern African with es work also being undertaken for overseas overseas mines including those in Australia Brazil and North America This is in addition continuing in addition to the continuing effon on behalf of our operatioperatioons ns iin n Rhodesia and Botswana Botswana Botswana As was to be expected som problams occurred in the Electronics Laboratory fire detection systems aher term exposule da operating conditions conditions These were rectified and should not recur A use the use the Muk Becon Muk I detector detector for dust moniteung e developed for use with the tire detectors are now being extended to other mining activities activities where rapid and accurate and transmission of information is essential enable enable corrective action to be taken Areas where where progress made include tans undergrounal chilled water control machine water circuits and underground pumps Work is continuing conjunction with the Cogincil Cogincil Cogincil for Scientific and Industrial Research and ABCH blasting improvement the development of controlled successful would result in productivity productivity productivity productivity sequential significan Perhaps Perhaps the most the improvement ling mits now important sich elopment during the year has been standardisation of maximum demand controlIndustries as well With the rapid hosed upon muavinman ich partly sheathing ad this continual majer Jull operational operations operations is of considerable| success is achieved achieved in this field colaboration particularly with with the Chamber of Group's mining research facilities have entbits solve particular particular mine problems Raise boring now become Preliminary research indicated the economic feasibility of waste stowing in mined stopes is possible that this may prove to be the most promising method of counteracting problems arising from increasing depth and lateral spread of worked areas as mining proceeds The only afternative afternative to minimise the increasing increasing pressures would be to leave substantic areas umined which would adversely affect operations During the year waste filling has been proved be technically feasible but severe severe wear of components has been experienced and this will have be considerably reduced to improve the economics of hydraulic filling with the fine process tailings tailings Another method using residues has also been demonstrated on a small scale and intermediate scale testing has started underground underground Effective use of either one or both of these techniques would have a major impact on stoping operations as well as substantially improying improying the underground environment The use of continuous miners for the mining of coal increased during the year Associated research on optimising and modifying the design of these machines for local conditons continued at the Chamber of Mines Progress was made in the research programme the disposal of ash into previously mined areas It is now apparent that these fingthods will allow the mining of limited additional tonnages tonnages of coal ^fin thick seam conditions : conditions where previous mining only extracted part the seam The development of a circuit to raw coal the Landau and Bank which includes the experimental circuit er^'ctedat the Fuel Research of recovery additional low coal beneficiate the -0,5mm fraction of collieries is in progress This work treatment of material at pilot Institute may ultimately allow the at these two collieries Finther Finther details details of the principal prospecting companies administered within the Anglo American Corporation Group are given on page 102 June 54978 54978 Annual financial statements _ for the fifteen months ended March 31 1978 a : statements statements appear = The annual financial statements which appear on pages 46 to 74 74 were approved by the board of directors on June 23 1978 and are signed its behalf > : Directors report 46 Consolidarebalance Consolidarebalance sheet 50 Consolizate statement 51 Balarice sheet 52 ~ - Income statement 53 : Notetso the financial statements 54 Source and application of funds saz ENE O3 we Directors Directors HF Oppenheimer Keith Acuti GW4 Rdly JT Geldfinch Managbig Stectary GC Leeman Chic Accountant Auditors report _ Directors report members Corporation American Corporation South Africa Limited financial our examined statements opinion the annual 46 pages statements and group annual group : 71 on our exambiation the reports of the subsidiaries not audited by usy the financial manner required the Companies position of the Corporation of the Group at results of their oppiations for the fifteen The directors have pleasure in submitting the annual financial statements of the Corporation together with the consolidated annual of financial statements of the Corporation and its subsidiaries In terms of the merger arrangements with the Rand Selection Corporation were Lund Rand Selection group the financial year endbos th groups changed to March 31. The financial statenients accordingly cover the liiteen months from January i 1977 to March 31 1978 MERGER MERGER WITH RAND SELECTION ; A Wholly The merger arrangements provided for Rand Selection to a of become Wholly owned subsidiary the Corporation bythe Rand Selection ordinary shares held by shareholdecrasnco elt lah tioenrththee Corporation and its subsidiaries and the issue to such shareholders of 200 ordinary shares in the Corporation for every 100 Rand Selection shares held envisaged A prerequisite the merger was that Rand Selection would make a tights offer to raise RS4 500 000 to repay its short borrowings a from the Corporation and to provide for commitments Accordingly 562 Rand Selection ordinary shares of 50 cents each were offered at a price of 800 cents a share Rand Selection shareholders in the ratio of 25 new shares for every 100 shares held The rights was so ananiged that subscribers for Rand Selection shares received fully ordinary shares the Corporation in the ratio of the merger terms stated above Subscriptions received for approximately 52 cent the shares offered and the balance was taken by De Beers Sonsolidated Mines Limited which theailler : underwrote : : e 2 oo Members were informed in press announcement published on May 4.1977 the Supreme Court of South Africa had granted an Order on May 3 1977 confirming the reduction of the Selection to give effect capital of Rand the merger the Corporation with Rand Selection - oa . . Roo : FINANCIAL CONSOLIDATED STATEMENTS STATEMENTS The comments that follow balance a relate the consolidated balance sheet and the consolidated income statement of the Corporation and its Subsidiaries The results of Rand Selection and its subsidiaries and other companies which by virtue of the merger became sub- sidiaries are included in these financial 1977 that bring the effective date statements from January 1 of the merger with Rand Selec- He Accordingly the figures in the finangal statements are nut Comparable CAPITAL At Janitary [ 1977 the authorised - 140 000 000 capital was R20 000 in ordinary shares cents each 1243 250 six per cent cumulative prefer^"nce shares of Ri cach and R4 758 cumulative preferred stock In 750 six cent cumulative on terms of specialzzesolution specialzzesolution registered May 1977 the authorised capital was increased from R20 000 to R30 000 000 by the creation of 100 000 000 new ordinary 000 40 cents each oa shares of ordinary At January 197 1977 the issued capital as R17 931 280consisting of = i Directors report 4 Shares of 40 cents and cancellation of the 34 828 shares in 69 999 656 ordinary shares in the Corporation were shareholders in Raid Selection other than shares credited Selection rights subsidiaries and as fully paid offer 24 125 076 of the were isnedto the : Corporation's SubSubscribers scribers to the share incentive scheme 114 500 ordinary shares granted to the directors in terms of section 221 of the Companies and Act 1973 as amended These general authorities remain valid only until the next annual general meeting which is to be held on August 48 1978 members will be asked at that meeting to consider an ordinary resolution placing the remaining unissued ordinary and preference shares under the control of the directors The full text of the proposed resolution is set out in the notice convening the annual general meeting . terms incentive further salaried employinggit At 500 shares available 1978 there issue in terms of the scheme + to optioorn digsgy shares held senior members the fifteen months under review leaving ^ options outstanding at Match 31 1978. No options options | issued capital was R27 203 consisting of shares of cents each fully paid and-and- to 10.5 per cent by means of a private placing of of ongoing redeemable preference shares having an average life of the finanfincanciinn g g ongoing commitments Details were compained in circular members dated June 1 a general meetiofntghe Orporation which was held 1978. At inceting members approved resolutions in of which the Corporation's unissued preference stare capital of RAND SELECTION USS20 167 000 HALF PER CENT CONVERTIBLE LOAN 1986 In February 1971 Rand Selection raised a half per cen 1 USS30 000 000 R21-288 R21-288 000 loan represented by 30 000 bearer bonds of USS1 Prior to the merger with Rand Selection bond- holders had the right at any time until January 1986 to convert their bonds into ordinary shares in the capital of Rand Selection at a 1,40 price of RIL.75 share calculated at fixed exchange exchange rate R1 to 1.40 As part of the merger arrangements agreed to the modification of the conversion rights attaching to their bonds so that the bonds are now Convertible imo ordinary shares in the ; Corporation instead of shares Rand Selection at a price of R5,875 a share calculated at the same fixed exchange rate of RT to There were no bond conversions during subsequent to the fifteen- ordinarymouth accounting period 7 and there accordingly.20 167 bonds outstanilttig at the date of this report To satisfy the conversion rights respect of these unconverted bonds 2451 914 of the Corporation's ordinary shares are being held in reserve : r was subdivided into 49 650 000 cumulative preference shares 2.5 cents each and placed of the directors Articles of Association were amenited to redesignate the cumulative preference shares chantifative preference shares and provision provision was was made for the dividend rate terms of redemption of the preference shares to the directors or by the Corporation in general alue of issue It intended to issue 000 000 of these on July 1 1978 at pre^mumof 97,5 cents a share that Corporation's issued capital will increase by share premium by R39 million It not imended to which it is anticipated yearly instalments comuniencing preferenpcereference shares will SHARE PREMIUM : ; At January I 1977 share premium account stood at R202 000. { In respct May 1977-91-124 1977-91-124 772 shares a premium of > R267 907 000 in respect of the merger with Rand Selection increased the share premium account to R268 109 000. terms of special resolution passed by members April 1977 and Order ofthe Supreme Court of South Africa both of which were registered registered by the Registrar of Companies on May 1977 the share premium by transfer account was eliminated the of R268 000 non- distributable reserve Since then 114300 114300 incentive scheme shares mentioned above have been issued at ruling market prices The resulting premium was applied in writing off share issue experises of amounting to R470 000. On the isue redeemable preference shares ^n issue of the 40 million cumulative f^ly 1 1978 a premium R39 million will accrue to the Corporation , : directors to allow respect of flie share option and share in substitution for conversion of bonds of ordinary 000 half rsited rssited redeemable INVESTMENTS Fa, subsidiaries During the fifteen months under review the book value of the general fy.tments fy.tments held the Corporation Corporation and its subsidiaries increased R30887000 R308 70 0 R30887000 to R835 574 000 of which listed investments increased by R362 000 and unlisted investments increased by R7117000 R7117000 The market value oflisted general investments at March 1978 was 996.737000 31 95000 996.737000 and exceeded the book value by RI 282 compared with an ex a expenditure daimed The Group incurred 1976 has 1976 been adjusted Objection to the being lodged and payment period unda beeni^lade to March 31 progesti 1978 has been provided on the applied assumpti^-ar that the revised basis of assessi^fljent will be However is intruded that an objection will i lodged Extraordinary item . : Due to unsettled political conditions in Central Africa together countic difficulties experienced by Za^flre and the lov : financing an possible to conclude satisfactory copperproject in Za^flreand work was therefore suspended suspended inin January 1976.Corporation and Rand Selection in 19761976 consequently made provisions of R20 000000 and 10 000 020 respectively against the copper price value of their investments in SMTF During 1977 the remained depressed and it was not possible to raise satisfactory terms for this project further provision has therefore b^,enmade against that book value has bren prycided the Group's investment against full As reported the Directors review year considered by the principal shareholders and = the principal project fenders natial Botswana RST Limited BRST and its 85 the per proposals were being Botswana Government restructuring of ce subsidiary BCL which operates the copper me at Selebi- Selebi- TheCorporation and subsidiaries have a 12 provide per cent interest in BRST as well an obligation to the finances required to meet certain ar angements undertakings given to lenders to BCL restructuring arrangements Mere concluded on March 16. 1978. Further details a net 20,2 completion arrangements of these arrangements are given in the Directors review on page 11. The need 4pse alia for project project restructuring the restructuring involves significant changecshanges in these . arrangements to and those of the BBootstwsawnaana requirements the principal project lenders Sovernment In these circumstances and reflected the second interim report of the Corporation published 1978 the directors have considered if prudent to as in full an extraordinary charge R25 907 000 against the Group's investment in BRST al March 31 1978 a Consequent upon the restructuring arrangements the completion undertakings in respect of phase one of the project have been met Work is progressing on phase two which on its completion will enable undertakings to be met It considered that invested terms of the restructuring restructuring arrangenients will The recovered over the medium and also is a reasonra eabsolnaeble achievinga reasonable return investiment Buller Oppenkamer Corporation Corporation's diffector during the period Corporation's Corporation's Corporation's Affields cost lesyamount's R1996751000 197R61996751000 1976 R1996751000 1976 R934221 296 011976 011976 BROGH provision 104 469 692 4.759 174-151 BO GISS 63.008 63.008 287 050 10401 17.030 ot 2081 H 8 2081 | 7006:40 380 33.194 33.194 981 JO1175 JO1175 before Group profit before levation Laxadigy a: ce shareholders before Extraordinary 39,9 197663,3 cents 31.3.787 ROOO'S ended 33.12.76 R000'S 87481 49 736 Ry 053 4 647 pos 2940 5,7 a. 16.884 16.884 05 a CORPORATION OF SOUTH uy Share premium Jovestment in subsidiary subsidiary companies Shares al cost lesasmounts provision accrued invesumes invesumes invesumes invesumes invesumes invesumes amounts amounts market value 23908125390815 others less Bigs Office research and transport a Notes 31.3.78 R000'S 296 ; 586.760 57.339 185 242 393.695 393.695 578937 578937 31.12.76 RO00's 172 _ 202 84 148 > 207.930 305 452 .4.759 310 60038 60038 -12438 -12438 33.074 33.074 408 729 220 605 64 195 693.529 1119531 359 163.983 18912 296 527 1296 330 statement statement statement statement Investment fcome from Incline fom Surplus laxation oo oy. e feeb eee ele : eine eee Fordinary shareholders before extraordinary item 08 00.0000 Retained protir before Morandipan nem extradinary item es MS. wes popata pre sitlen tp tesy 31.3.78 ROOD'S 570 100 513 65.056 65.056 Year ended 31.12.76 2 ROOD'S 36411 021 2946 504 25 450 14.679 14.679 791 791 70 405 132116 ; f - 8891 3381 3.104 44.980 44.980 66-261 63.760 63.760 . 286 a s 121,656 a : x 63.474 465 Danapploquialted print the directors permanent provision for such hesuments permanent diminution of the group diminution in predominantly income value of an inggament flowing profits . in term holdings Where nordial effomstances . relating the development land and buildings the capital cost of the development forming part ze generaly written down a u generally maintained a book cost to nominal value o 7 Where exploitation is not Tg and leasing assets is included in the income statement in proportion to the instalgients stores are valued love of cost and pet realisable includeca proportion overheads realisable value Cost is determined mainly the average average cost basis the year i exchange contracts expressed in South African currency ar nsactions and conversions other than those relating to insurance are b information accordate with consolidated the Companies listed life listed insurance insurance financial Statemeius in respect of subsidiary life insurance companies in Companies 1973 amended relating to insurance companies in particulars investments investments The disclosed investments disclosed basis of valuation of these investments is stated yxpenditure yxpenditure yxpenditure uansiers to separajdy disclosed in the consolidated balance balance sheep and movements thereon are not : : . . 7 after rasters , stated after rasters to contingency reserve individual items of income and equited to be disclosed in terms the Act are not separately stated deserve may : : * research equipment the year is presided presided a straight basis over the periods of the leases againsnfreehold land buildings depreciated on sqaight line of diminishing value bases to reducetheir book values cent cuffulative percent 31.12.76 R000'S 1.000 241 30'000 22/296 of 10 cents each and 1 250 six per cumulative million ordinary ordinary shares were placed at senior alterabers of the staff as the the disposal followsz of the directors acting through { Trustees . the disposal of directors but when the scheme was discontinued during shares which were transferred the share incentive scheme at that - retirement the option hilder whichever is earlier Balance al 31.12.76 500 157800 Lapsed Sturing Sturing period 500 31 Exercised during 2 peribd oo 500 7" Balance at 313.78 175.000 175.000 147.300 500 4.000 Ja oo 141500 141500 disposal of directors and 786 000 were transferred from share available for issue under the scheme Of these shares 114 500 were under scheme At mustees of the share incentive - March 3;1 1978 995.000 995.000 incentive Rand Selection Corporation scheme ROOD'S 202 feo 267.907 268 579 5701 268 109 ie reserve the distributable subsidiaries auquined minority interest during the period auributable Group ROOD'S 89 214 268 109 4.885 221 5.106 5.106 319 158 280 757 365819 as follows Toial Group 7 General Unap- reserve propriated % Currency reserve ( December 31 976 respect of previous year's taxation . R000'S 367 104 ROOG'S 959 Ae 293 _ ce. profit R000's 15 976 1 298 R000's 4169 . from Adjustment chancg hane gess exchange exchange during during attributable to the Corporation's minority interest oo . rates -- 12 191 2 : . 48.849 48.849 742 : 878 311 . 15.744 138 : Retained profit after extraordinary iten a0 62441 oe 62.441 62.441 - loss arising from changes in exchange rates o, 505 period | eat) 106 69.919 75.025 449014 449014 17527 a Swiss francs Group Rand equivalents 31.3.78 R000'S 31.12.76 7 R000'S 8556 40 870 14311 30.000 60038 9.282 9.282 20016 redeetm he full loans outlier years 1978 in 1981 fi. o cancellation annum cent per annum the market andis repayable cancellation repayable by November 10 15 1987 subject the undertaking francs 500 000 of the loaf at prices 1983 1986. The Corporation has the an ual any interest payilen payilen 2 date at premium of2.0 per cent reducing by 0,5 per cent thereafter and thereafter par The servicing and repayment of the loan are covered by forward the Corporation and RSC ip a loan raised by an associated associated company S annum and are repayable in instalments on June 1 in each of the years $ 1.802.000 1.802.000 1054.000 1054.000 March38 1997 has the may annum and is repayable at par in instalments of $ 000 on March 1 in 000 March 1 1982 and 8 000 000 March in each of the years| 1983 to certain circumstances make repayment earlier : 6,5 interest at the rate of per of the Corporation a cent per annuni Holders have the until January 1986 to price R5,875 per share and calculated calculated at an exchange exchange rate of R1 afpar on March 1 1986. However RSC may on giving no less than 101 per 1980 reand ducing by 0,5 per cent each subsequent March to 100 p on shates of the Corporation on The Johannesburg Stock Exchange on each ofthe prior the day on which notice of redemption is first publisheids at least 150 per has been or on the occasion occasion next payment due in respect of the loan will be compelled by law to African taxes The conditions of issue of the require that any such taxes shall be borne by RSC timeand ber any price in the open market any price not exceeding cent plus by purchased RSC may he reissued or surrendered for cancellation The interest and exchange contracts with the South African Reserve Bank 7 interest 10 interest the rate of percent per annumand will be redeemed 15 equal annual commencing on March 25 1983 with the final redemption on : so it to purchase debentures of such price may deem fit Any debentures purchased will be cancelled and fist be applied in reducing the next redemption or redemptions is represented represented per cent registered insecuted notes which are repayable repayable at par on March 31 purchased purchased or redeemed in with the note conditions 1982 certain the land and buildings shown in note 10. No further having book value of RT 000 and bears interest at the rate or6 25 15 000 until December 22.1984 22.1984 and the remaining balance of G S 1978 exceeded the corly instalmeinmstalsmems of 553 000. The load is & actuarial valuation of labilnies under insurance policies and and companies ahnuntedi^ahnuntedi^ R92 231 000 at March 31.1978 December 31.1976 31.1976 596,000 ansurance group and R68 596,000 December 31. 1976 R63 008 060 in other their the antibutable the outside shareholders of the insurance subsidiaries interest 1976 R3 342 000 in excess of market value and directors Valuation of listed and form part the insurance invesimiems a book value of R7 000 secured by pledge and cession of leasing assets and Q the hypothecation of land and buildings 255.000 255.000 + 2 Oe buildings movables book debts Q certain internal investiment portfolios relating to linked contracts have been r^'demptiqui valicalter valicalter public Cand Delgentures and other joan stocks and treasury deposit allowing US are for shown the consolidated balance sheet on the following bases : Bp all all debenture stocks and including fixed interest including dated fixed interest stocks including Loe R000's R000's at reflected amounts related to 00 : amicpated los es where applicable and consist of the following es ; stocks vs . 228 : oo : vel bs : eee AE Lene eb eth OF 14,760 14,760 Loi .6-299 31.3.78 R0R00000's'sFE : . me of the tellected cost on aniints based oni eriodic valuations consist of . a0 , mS buil anddbui ildin ngsgs Listed equities and opr^>^ns O00 os swe : an Boas oes : to lawn een yee Seok 249 1-493 0 do property owning companieasre reflected reflected ai cost revalued valuations of the ective equities after deducting a provision for Plant machinery Mingratrigus Mingratrigus motor equipment Fo Mey motor vehicles and equipment at cost acculated depreciation and amounus written ot : Office search written olf and amounts written off ROOO'S 31.3.78 Costoi valuation valuation 31.00.76 ggregate depreciation ggregate depreciation depreciation and Book value 31.12.76 amounis written off e R000's RO00'S os R000's 34365 34365 recoupments recoupments recoupments and amounts off vis . * ~ 40178 fi 11453 is open for inspection at the registered office of the Corporation by members or their duly authorised are shown subsidiary above group cost or aliation aliation Otlier fixed assets are shown above companies no adjustment has been made on consolidation the and acquisition of subsidiaries = : : at cost or valuation per the 10'401 is leasing of assets The assets are leased for periods of between wo : 3 2aa9 1093 Varga currencies in respectof company has with The Diamond ; The Corporation's obligation has however - guaranteed as to 50 per cent by a subsidiary we Group Ba 311276 o 3.78 311276- R000's R000's > and repayment of foreign to Highveld Steel and Corporation Limited of USS20 000 O00 1976 DM100 DM100 000 000 0001 The servicing and repayment of the loan is forvand exchange contracts with the South African 33.12.76 RODY'SRODY'S ciquivalent Government Soe Which were counter guaranteed guaranteed : ; 5.799 Bee eee cee 960 22 068 123657 18891 guaranteed guaranteed guaranted to aass : a + : an bese . Corporation shown in iv above inchide a loan advanced to gold nibning companies commitmentsobligation tras been fully guaranteed in respect : ab 2 670 pte PAY 68 032 41 884 {ae ded 26 148 whereby the which finance may Corporation and another to undertake provide or procure 37,5 per cent required of be required required to complete Phase wo the BCL project equivalent Limited in an aggregate amount of the January 1.978 to 1.1978 Decembe3r1-1983 31-1983 of R10 500 000 for pollution control control Limited equivalent of R43 884 000 which may be required by BCL deficiencies equivalent arisingduring toner casti deficiencies deficiencies ofall kinds other than deficiencies the period from projector control of pollution assumed by a subsidiary to the extent of 18 per cent and 46 per cent by associated cipe from subaliaris Group Investment income General investments 31.3.78 31.12.76 R000's ROOD'S 179980 179980 020 213 179 87 181 31.3.78 R000's 31.12.76 R000's 28H 4448 25-729 Group included the previous previous practice employed over many years in respect of certain expenditure year 1976. Objection to the assessment raised by the tax authorities is being lodged under protest The unappropriated profit of the Corporation and of the Grayp 298 000 being the additional tax incurred provided provided on the assumption that the revised basis of assessment will be applied Protirofler profits taxation of the Corporation and the hay group , after taking into account the following expenditure Group 31.3.78 31.12.76 ROOO'S R000's 3932 52 its subsidiary companies 31.3.78 RODO'S : 110 1.989 90 1 346 87 are Vapital of the Corporation Corporation 964 shares issuing is uing issuing fiffeta mantly to , capital Deceper 31 197 t se 537 shares However the earnings per 31 1978 as calculated follows eee eee deal share have based on the 3 Shares 31-725.300 69.999 69.999 656 21. Dividends Na 97 of three cent declared June 1977 |, cent declared December 1977 On cents per share declared May 3 1977 12 cents per share declared November 24 197743976 197743976 share per share declared declared declared declared June 5 1978 1976 25 cents el ED Oc Provision against investment in Za^flre ve eeet Provision Provision against investment in Botswana Botswana Limited .. 6)... reliefned Less Fax reliefned respect of proportion investment .. 31.3.78 R000'S 143 143 286 | 16 642 749 55 741 99 132 31.12.76 R000's 143 143 286 534 32931 43 465 Group 31.3.78 12.76 R000's 10363 10363 ROOD's 20 000 25 907 ~ 270 2.807 20.000 oo 33 463 463 20.020 0.000 Source Source and application of funds statement FOR THE MONTHS ENDED MARCH 1978 Source of funds outside shareholders interest loan^ investmeras and less net adjustments arising Group 1978 Year 1976 2000's R000's 93 865 Proceeds from shares issued Loans from associate companies and others _ mineral ~~ Pinpetty rights and equipment o.... ae 589 Creditors provisions oo ee ee os 29 232 cost of shares in loans and amounts due Application of funds Investment subsidiary in cost of subsidiary companies investments acquired less cost of Propery mineral rights and equipment companieansd others companies and others imerest subsidiary as at March 31 1978 subsidiaries acquired during the 48 140 1621 171 = 1917 56677 15.518 99418 99418 9 162 58044 112/200 .90 3.496 647 43.751 43.751 _ 9467 247.592 230562 5. 704616 704616 240 857 ROOO'S ' RODO'S 210 122 88452.996 386 442 others others capital Se insurance ve . deen ee ieee ee etd anae Lecaes 108 420 456767 456767 1098 347 Subsidiaries which the Corporation Issued share capital share capital ROOD'S R000's 6-43 3.045 3.045 117057 117057 28 616 ROODK Book value Shares holding company 31.3.78 31.12.76 ROOD'S ROUD'S ROUD'S oprietary Limited pylene eapeeltesprietarch Choe rene na Fs oriciary Linized United kastmentsProprietary United Limited United Issued share capital Interest share capital Dict Indirect 31.1276 31.1276 : Book value of holding company Shares Loans 31.12.76 31.3.78 31.12.76 31.12.76 R000's ROOO'S R000's Spiti Brancin Holdings Prop geet Proprii PlzaPopolym PlzaPopolym Propriciary Buttal .,. opria Papety ompany ad ProtaryLinked Gold Mines ra koetan koetan #Svato hunited Prospectingdiervices Proprietary Interest in share capital 31.3.78 31.12 Book value of holding company Shares 319.78 Loans 319.78 31.12.76 31.3.78 31.3.78 31.12.76 31.12.76 ROOD'S ROOD'S RODO'S R000's 651278 651278 651278 6512788 6512788 5 Fagle Holdings andalusianaal Proprietary Holdings Limited Limited Limited Toped 20 760 760 Luxembourg Essured share capital 31.3.78 33.12.76 RSUno's NSYS Interest in share capital ' Direct Indirect Indirect 31.12.70 1.3.76 31.1276 31.1276 Book value of holding company Shares Lians 31.3.78 31.12.76 31.3.78 31.12.76 ROOD ROOO RODO'S R000'sR0 0's US500'S inefica is ene SOGON KID'S Issued share capital Interest in share capital Ditect 31.3.78 31.2.76 31.12.317.126.76 51.3.78 33.78 31.32.76 31.32.76 KOONES KOONES KOOOS wy > Book value of holding company Shares Leans 31.3.78 31.12.76 31.3.78 31.32.76 ROGJ'S ROOO'S RODO S R000'S Aapki Antica Antica strada strada i Lind incrporated in the United Kingdom Marketary Marketary bam Sales Li Incorporated Incorporated in Ca^-ada Asselda Asselda CSDORS westman westman AG PH000S PH000S 29.000 100 100 SSE. Incorporated in Holy Incorporated in Swaziland share capital Indirect Book value of holding company 31.3.78 . 31.3.78 Share 31.3.78 31.12.76 Loans 31.3.78 31.12.76 R000'S R000'S ROVO'S R000's R000's EDQO'S . 35 Tg mF ar a _ 428 . : : a wo 208 A ys. He a 4 | 729 89-232 605 | 367 Schedule of general investments AT MARCH 31 1978 ListeLidsted Mining finance Copper and other mining Alter Lease Units held Group MarketMarket value KC00'S 31.3.78 31.3.78 31.12.76 31.12.76 31.3.78 31.32.76 1485981 870 550 144 494 2900016 2900016 347 364 Corporation Units held Market value ROOF'S 113.78 31.12.76 31.3.78 158 044 950 260 181 992 131 962 90 1 166 13.894 33 683 500 806 153 105 269 892 239 380 7 236992 100 077 90.000 6.794 3597 50 111 598 4 824 104 802 41509 41509 349 133749 15-206 74556 260 505 089 000 90.000 90.000 361478 - 161478 % x 649 112 649-112 13.778 86 aie 907 435 10033 235 226 2339 16 100 7366 505 931 3391815 3391815 J.467 663 10967 10033 235 226 2339 372 6.465 293 116 66.440 No 7366 7366 33.805 33.805 637931 191815 191815 1467.63 1467.663 967 .18 346 Pag 84127 25 600 593.060 593.060 593 060 941 1-4691 8389 825 42 839 162 654 , 42.839 6176 176 16.001 990 370 325 4145 467 874 Bios valtation Roads 7 71276 Luts . Corporation Directors valuation ROS 31.3.78 11.12.76 11.12.76 on) 7550 Hi O89 560 50.000 SUrUuy) 315 oF? RO 5 986, aS 2 199 2.362 112-18 112-18 2.000 Darding DardinCg ompany Corporation Directors valuation valuation 31.12.76 7550_ 3.09 10.029 500 a . 50.000 50.000 ~ 50 000 315 657 800 Company a . : _ 706060 50.000 50.000 1379 . 1.260 1.260 . io fan. 150 69.500 69.500 496 000 italustal os and commercial Corporation Units held Directors valuation 31.3.78 31.12.76 31.12.76 Roop's 31.3 31.12.76 10326 0575 Associates Associates Barbie and as ociates re Beperk 0, ae Zinchem Zinchem Property McCarthy Investitients Housing Company Cer ae 5 718401 718401 1005/240 1005/240 19 370 25.000 } 370 25.000 25.000 1 . ae 820 156 99562 99562 730 365.000 365.000 820 156 Ff 99 562 730 365.000 365.000 : 610983 610983 983 , : : 17927 17927 3.120 3.120 1038 859 111 192 60 785 : : . 2021 293 bs 3.479 2094 168059 168059 ae 124 1876 876 a 50 50 = 425 000 624 000 050 425.000 425.000 480.000 217 500 2366 1.040 | 28798 39530 39530 Statistics FOR THE issued ordinaty capital and RESERVES RESERVES 469 692 Investments Book value Market RO00'S 262 200 688 610 > 927 Equity carnings after taxation R000's Equity carnings : per : share Dividend per ordinary share2 cents 11 16 40970 1102/2801 f t i 85992 2-269 0278 | 195036 195036 Mach commering March 31 1978 cent shares for purposes of comparison comparison shareholdere interest in surplus of market value old upside shareholders shareholders interest in of markme arkt et value and directors Total ordinary dividend R000's 18775 20771 22069 24 674 31176 38100 38100 449 43465 132 , hectares same rate the dragline mouth out areas at the Group's opencast coal Amcoal's Annet mine near Middelburg in the tsilhouened in the background disturbs surface land creating comprehensive huge heaps which are contoured programme is being followed to rehabilitate American Corporation Corporation Group and its associates direct interesis in wide range of financiai mining industrial prospecting insurance and oiler companies Particulars are given in of those companies in which the Group and associates significant interests Principal inance and investment companies 79 Principal operating companies Gold and unanium 84 O21 { 196 Other mining 90 Oil and gas 93 Industry and commerce 95 Property 100 Insurance banking and general investment 100 Prospecting Prospecting 102 me ea ifo1 otae oe Anglo Amera dh sarporation sarporatGroiup Goronup American Limited Ama Ama Cost Corporation Corporation i Anglo American Gold Investment Company Limited Amgold i Geup equity 47.83 cent and Avfersitciatnem major shareholdings in i mming companies exploration in Australia t ; ROOPS ROOD'S Issued capital ' of 2192012 2192012 ordinary shares Reach i 21952 Share prenant prenant and reserveresserves 141 709 i ATHE SIGORIJOS > Anglo Ameticam Ametic Ameta icam m Compriation Compriation de Brasil Limitada Ambras . . x Anglo American Canada Canada LiLimmiitteedd Corporation Ainean Ainean TSE TT wb the Atlan The Shareholdings of Angold and company Orange Free State Investment December FE 1977 were its subsidiary Trust Limited Shares centage . Gold producing Bietd | interest Blyvomitzicht Gold Mining . Sheet 33.9 33.9 541.4m 3333..33 33 van intawak OESEESESS cig EN I te intawak intawak compte compte compte Cesedidate Care Cesedidate dosified Buffelsfontein Gold Limited Company Company Buffelsfontein Company Tinited Mining Dehaal Dehaal Gold Lnkted DodsonteiGonld Company Limited has Dricontein Gold Mining Company Limited Fast Rand Gold and Graniton Company Listed old Mining Limited Elsining Gold Mining Gempatis Diudited Pree State Geduld Mines Limited 1ee State Saarplaas Saarplaas Gold Mining 1635000 22187520218750 2218750 5.468 690 701 888 063 509 000 000 425 306 1.351 500 2112650 6:81 20,17 8.68 4 7.1 11,12 20,00 22.70 4,47 20.24 Company Limited Harpiony Gold Mining Company Lamited Lamited Hanebstfonei Hanebeestfontein Gold Mining Company Limited 5.403 667 737 1737 700 19.23 7 2,79 Mines Limited 102 600 Khoo Gold Fimited Mining Company 2413467 2413467 L tama sd ted servers servers Seeo's why 199 AN SOROS SOROS Loraine Gold Mines Limite President Gold Mining Limited Stern Gold Mining Kempen Limited St. Helena Gold Mines Limited Vaal Reefs Exploration and 2297 000 2808 2808 000 004 500 185 1885 000 20,00 20.63 14.58 yee Rhodesian currency a wad Mining Company Limited Veriterspod Veriterspod Gold Mining Company jamiel Gold Mining Company D^,,nited Gold West Drietomeit Maing Company Limited 3.106.400 3.106.400 33.500 33.500 33.500 230000d 230000d 2000 134 16.35 99 14.20 79 i z i t : 5 ' Fi } t : i i ij i H : i ! z i Anglo American IndustrialIndustrial Jamited Amick port eastern Transvaal 306 ton steelcolumn and the effective responsible responsible for handling this and other Sasol Sasol of discharge delivery at the Secunda construction construction construction site ech engineering and tekster inda ties Consolidated Metallurgical Industrialunive Smited Smited Timber and paper and ma Holdings i industr industr 1426 206 avr) 300000 300000 700 700 1976 RAIDE'S 50719 5057017919 56 08G Shares held Mondi Papa Company Limted Limited Sappi Limited Property Isipingo Property imited Investments Investments Food and produce Africam Products Limited OKKids OKKids Limited Sectvelde hans Limited Hie Tongaat Group Limited Textiles Industex Proprietary Limited Romates Limted Limited Limited Motor and transport McCarthy Group Limited McCarthy Main Heldings Limited Sigma Motor Corporation Corporation Proprietary united 15 320 120 300.000 300.000 500 323.500 323.500 250.000 48.500 48.500 1031 250 1273217 1273217 751900 2059 940 500 7013330 7013330 Percentage interest 39,79 1,05 25,00 8,76 50,00 21,62 6.32 12.13 25,00 8,05 Anglo American Investment Trust Limited Anamin 40.34 11000000 Loe 1250 Cae ht hoe 1:16 AAC Group equity interest - 52,16 52,16 percent percent An investment company with with shareholdings De Beers Consolidated Mines Limited and and certain diamond Ar^dding companies ended March 31.1978 Issured capital ordinary shares - 10 000 of each . six per cumulative preference shates 500 000 of R2 each Distributable Distributable reserves ined Investments Investments o Listed - ALCOSE ALCOSE . Market value Unlisted + Al coal valuavalution t valiuaotin on earnings Dividends paid -- ordinary investments at March 1978 RO00'S 1977 ROGO'S 5.000 5.000 5.000 5.000 228 5.000 48 8948 411 520 46411 398 3451 11 656 92 347 634 60000 31 1978 960 47943 47943 123 41000 41000 were as 13.10 pot Abrasive Abrasive tant Sales Limited Nshares Nshares 19.30 Anglo Americ^n Corporation industrial Limited 1.16 1.16 2626 in Bras Consolidated Mines inted detered shares deterred shares Diamond Purchasing and Trading Company Proprietaryi Limited The Diamond Trading Company 0 181.8.001 1 Proprietary Limited Industrial Distributors 1946 5.350 5.350 Limated ordinary shares 303.00.000 53.34 live > per cent cumulative participating preference shares Industrial Cirit Distributors Shannon Limited Shares held 600 590 625 44.862 44.862 330 461 500000 330.000 150.000 150.000 28000000 Petcentage interest 12,00 2,20 26,37 18.47 50,00 13,20 30,00 5,55 Anglo American Properties Limited Amaprop 6 . Pe L . os po . - : ; aerE Pe we on . Pity e * Minerals Resources Mlinorcor n 82 . be a my copa a Administered outside the Anglo American Corporation Corporation Group Charter Consolidated Limited AM Group equity interest . Charter is United Kingdom mining finance company operating internationally with diamonds copper rim and wolfram interests in gold platinum potash industrial interests These minerals and important include a majority holding in industrial Cape Industries wholly owned subsidiaries Elastic Rail Spike Sadia Holdings Limited Refrigeration Limited a manufacturer of bar the which which was acquiredin August 1977 merker alne of listed investments and valuation unlisted investments the net calue at March 3/1978 3/1978amounted to 287 604 000 54 000.The followingis an indication of geographical location of its assers and revemte subsidiaries into account its direct interests and also where Perionage its major indirectindrect interests Assets Percentage 1000'S 1000'S of assets Percentage of revenue Pobed Kingdom 98/899 98/899 27.0 32,5 Rest of Europe 30.929 30.929 8,4 8.0 North 4 9.7 . 37.9 1,5 474 $ " < eS . ended March 31 1978 capital Issued capital 104 837 397states of 25p each and 256 500 shares Ip paup and reggives reggives indebtedned 4reggives taxation 1978 God's | 6000'S 212 181 150 202 190519 190519 + 06-4 9524511 3 Valised Ai cost Directors vakantiona 133943 210 673 380 138 519 196412 57.450 380 277 +7505 +7505 All are amounts expressed in United Kingdom 1978. Charter's principal investments were as follows currency compoiatiodno Brasil Lipitada Corporation of Canada Limited Corporation Corporation of South Africa Limited t Finland Finland Wolfram Limited Botswana RST Limited Cape fadustries Limited Cleveland jimited jimited Potash Corporation Malaysia Mining Corporation Berhad Minerals and Resources Corporation Limited 5,9 10,0 15,0 48.2 4.5 { 37,5 28,6 20,0 . , a z 1 } i fot FA i : H : ; b a H ne ! : : i ai on 3 ; JohannesbuJohannnesgbung Consolidated Investment Investment Company Limited JCD AAC Group Paper Company Limited inked Breweries Limited ' Souls Africed invited minginan Finance J taking fisted Standard Propetiva Downtown Downtown Downtown mineral processing indietrial indietrial indietrial finacial Isday's Proprictares Place Holdings Investments Proprietary Proprietary Limited industments 170399 170399 000 165 set : 2 cant * + * a a ee . : i : . : . - 7 Diamond abariig abariig Western Platinum Rocky bung Platinum Holdings Limited 2 Musaal Diamonds nat Chal a a aga The Natal 1080 | , a Antifiony Antifiony GayolidatMeudrchison Murchison as 8 Anestesia Anestesia Anestesia Anestesia jase EMAnT estesia LoS atiectinen = westerS #profdet #profdet path to tas State's shares loses e Consolidated profit Alter tax Miori interes Profit attributable ta -Defined dividends De Beers Jading Linuited Bopriciary Linuited mmpany Limited 5 it Quoine Gasolidated Limited Gasolidated Gasolidated ) Industries Limited 2 Limited ) 2 Mining Finalice \ Her blate Development lavestment \ % ge YY . Proprietan Proprietan Holdings Proprietan Limited Limited Publishing Company Limited ~ Company Limited Fimber Linutyd fi . 5 83 , : Principal operating companies Gold and uranium ORANGE STATE MINES ~ geoadg Administered by es the Corporation LOKAINE Area held under p espect GEDULD STERN HOLDINGS KLERKSDORP MINES AREA Corporation Producing Producingmins cov BUFFELSFONTEIN HARTEBEESHONTEIN Vaal Reets Explotaion Explotation and Mming Compan^'Limited AAC Gucapleguas interest 9.event RU SON O2S PODYPLA DAKOOL 7-572800 30041 ? 29 8740794 8740794 Ron 241 000 R1803 R1803 R1803 RH 74300Y 74300Y 12 70 0 1227000 822525.000 R20 822525.000 QUODO in Moted 1983 December 31 gratis per t Administered by the the L Corporation Producing mines Admaustered in Admaustered AdmauAsdmautstereed rAdemausdtered in East ue Drietombes Gold Mining Company pie pe Beet biter adh aa le pet eat " ned Faxation and State's 1976 831 874.000 874.000 R21 000 ending lune 30 1978 grans per toti DOO OGO Kloof Gold Mining Company Limited AAC Groupeqqan Groupeqqan interest 4.1 4.1 per cent June to bs 1976 capital giron giron shares of Blokh Tens Billed R30 K30 240.000 139000 139000 11,2 protit Limiteal Working R27.40 R22,70 111000 | 239-000 239-00 239-0 000 profit 000 021.000 021.000 R14 213.000 213.000 expenditure for the year ended June 30 West Briefontein Gold Mining Company Limited etated fone to pu Issued capital 14082 14082 T60 shares 1970 grams cost periton periton mufled Working prodit 23,7 000 890 000 R14082 R14082 000 246 246 000 21,5 R18.31 & 628 R152 000 587 000 Flannel PRI capital expenditure expenditure PRI sue 000 879 145 000 R39 450 000 by the R92 678 000 847175.000 847175.000 847175.000 ended tune 30 Zandpan Gold Mining Company Limited AW Gapopity Gapopity interest ? # anain basuess is celestine sp Hartebeestfontein Limited per cent the holding a Gold 19,6 per Mining of results which appear 1977 7 R000 1970 Roo's 1020 1069 EAST RAND AND EVANDER Administered by Anglo Americari Corporation East Daggatonicin Mines Limited 11.11 11.11 RAND AND EVANDER MINES other other Administered by muning muning muning house financ^ financ^ financ^ house houses Workellstar Workellstar Minesuted Minesuted : the Corporation Corporation Group De Bebra , Pataspati Bultfontein and mines Wesselton the bin mine north west of Namaqualand pivisio the range Free State is comently muining alluvial alluvial Atex Kleinzer Dreyers Pan Komnennas and Langhoogte nathanm shortly De Beers absin operates nathanm the sansvaal sansvaal Copsondated Copsondated Diamond Mures of South Phe medicarus medicarus along the southern portion the a leading producer of dopricdoptrictaaix dioprixctaix tatsu la full Proprietarye Urapa and saputant new cHR leur southern vous to be bronghi Dyigion Dyigion Progniciaty safe De Been sburg sburg * : ral Balgias Collieries tplate anthracite other mo wholly- Impatt supply tiestod et units euch sales Ins comodidated prodit alta R7515.000 Year ended June 50 1976 000 000 R2 258 R1 080 000 _ ji A-TERADQ vy } my LESOTHO : Natal Coal ANC Groupe Exploration quilts telest Company Limited 31.83 percent the chosate 199 the company's the collingy in October business confined the receipt of The apreether proding burninous coul trade allocation fo collienes Natal in Mooikrantz area Collieries Funted The exploit exhausted exhaus exhtaue std ed Lighteen in 1980 TORRES ended December 2201 Year ended Tube 9261 Roda's 5845 200 200 Swaziland 529240 134 000 FAH 529 230 123.000 1-31-4000 1-31-4000 Swaziland currency the Viljoenskroon and produces Anthracite Colliery finted : Wr aanena 9461 9461 000 900000 1361 000 R129 R450000 89 : . Piss pare weary, & Colieries Other Group Callieries : ESM Develing Colery ee Trans Natal Coal Corporation Corporation Limited kionjol codblesses Witbank theup Colliery Limited opary interest 44.17 the compan Sy district district of the 197 R12576 R12576 862 DAY 000 R12576 000 10 068 000 TK13 223 R3510 R3510 : Other mining in i Administered within the Corporation A : | Anglo Ame eanCorporation Group i : Muldelplaas Manganese Louited THE ZAMBIAN COPPERBELT Copper Mines ' Divisions Divisions 1975 Peo 1976 Poop 5 > 3 shares Zambia Copper Investments Limited com an the form of B dine skates Ju KODO'S 1979 K"GO's . : : a . : . Doe : . . * : Bee nome Na ee , : . . se . pote a Mas z . at . : ors aa : tee * . . Inspiration Consolidated Company dec hee : x : Le fies es bins sap conden ky 8018 : pulative prefrenc 153070 Njon som uhmbative pretesence 0187 ON KORD shates penium and resrives bats tinished 570 636 187 905 119732 427830 385414 JOHN AvelineAveline procesis procesis pet ton revenue 425931 486 201 K1072 K768 506 327 320 . 34492 4864 amounts are expressed in Zambian currency a wee roe . wes . 5 . : ; . fo west Sage * vay ba pines re a bot . fe hog ey Juftir Roan Consolidated Mines Limited The company Bansha Chibuluma Topbeh operates copper mines at Mutulia Chibuluma and Chambishi on the Zambian HH kalengwa the North Western Province in coppe at and refinery Ndola Zambian government holds 51 per vent of the company's issued etdinary share capital the tint of shares Zamibia Copper Investments Limited cent of the equity this form of B fat : : 15-461684 15-461684 15-46184 1977 Kono's 198 K000's 6 843 99417 99417 163658 163658 61 843 50.417 50.417 147 604 pe Lot . , 7 : . . . : moat .. . : : 5 . . ; poe 7 a ie : . 5 5 ; ; : : : ; i . po ; : : " - ; oo * , Hos. 7 Ses ; : a : : : vets . : : 4 os fon be yy : Nihanga Vesofistated a. a phots per int STEP STEP 8806 L evetna 309 369 326 536 ) Konji Konji 20855 292 aptem Zambian suitency Platinum Holdings Limited RPH hidds Platinem 1997per cent the cathe issued Share capital of Mines Fanted which operates the Taustaaf and is the producer of platmann Other copper platia well nickel and in portant portant contiators contiators to total are 10 September 1977 the entire issued capital Proprietary Thanted was acquited the spread of the company's ue aa Tested 1975 1976 Rono's 5.0002 12300 12300 12.300 7 i , : : ; : : t i ; i : r : : : i i : H Hy i i : : log ... 1976 and gas Sammam i : a t ' 4 Rv quae .app 4580 990 Administered outside the Anglo American Corporation Group Canadian Merrill Ltd The company production States o19 per is involved in the exploration for and and gas in Canada and the United cent of the equity is held by Hudson Bay . Luria bo dae Los Mines Launited hai stockstock 137 Suites no par valte shareholders 1977 5000'S 6.99 13 409 16331 1976 5000's 6.692 9613 10552 Hemisi All amounts are expressed in 3.555 Canadian currency currency 1987 tude banels voxtal ave ige gas million cop average 241 QXE 225 000 614 11-800 32 9.500 16 Francana Oil & Gas Lid The Company engaged in the exploration bit and the and natural gas in Canada and a 56 per cent interest in Trend Imerational Angin American Corporation of Canada and unison Bay Mining and Smelting Co hold fatcrests of 28 29 tinely in Fran^ana per cent and 5401 p" 1977 5000's 1976 5000's 4 : Lo x equity operating revenue extraordinary usstatter 37 140 18 827 63836 63836 9.907 37 140 38920 38920 53237 1994 amounts arexpressed arexpressed inCandion North America only bateli 9907 1816 1816 xuency 13.000 2037 95.000 95.000 2061 7043 8.1 a i 2 864 000 which is Trend International Limited Trendi whole duned absidian primary head in the 6 a . fi + - Oo 2 : oa a a . PI interest - 49,67 cent as shate transfer secretaries the Anglo American Corporation Group associates At December 31 1977 Hanster secreiaties to 80 companies company acted Eastern Transvaal Timber Company Proprietary Limited of company which 15 000 hectares land in th Waterval Boven and Barberton districts of the cimber growing operations company's company's plantations is undertaken Dwelmients fimited Highveld Sleet and Vanadium Corporation AAC Group equity interest '26,39 per cent operates an iron steel complex at Withu,, k the Transvaal The full requirements of both the steelworks and the Vantra fivision which produces vanadium pentoxide are Highweld's Mapochs mine at Roossenekal Hansalloys Proprietary Limited Highcld's requirements of ferro an exporter of manganese 1977 ended June 30 2 : KBOO's 1976 ROOD'S on : State preiniuanmd loans and provision 4M 191909 191909 7 740 10158 No 30.294 54.897 128353 15.908 2391 . Hippo Valley Estates Limited piedicis The company produces sugar citrus and related piedicis Rhodesia Year ended 1977 5000'S 1976 5000's Reserves 1976 1976 includes premium 1976 includes taxationpian joje 21965 12.066 12.066 12784 7987 24.069 . 15025 3.983 + All amounts are expressed in Rhodesian 6781 3.302 LTA Limited largest building and civil of Africa The activities interested cover the full engineering spectrum from small projects turnkey projects the complete design engineering and construction of plant and buildings and also indus trialised building the manufacture of prefabricated and reinforcing building componentansd < 5 Kd y 95 2 i : ii t A i . % i H > + on . Be tygen Estondi 2 Estondi Estondi Paper Paper Company Company tarnited Estondi eae Boon Shant Sinkers Proprietary Lunited DMetest percent to sphin j , poplar and phormium The principigeration principgeration is the production production of tanning extract bark and three factories operated to this are products produced in 1977 included By 288 approximately of 50 bark and 000 tons of timber 152 000 tons sugdi cane 000 tons of of Natal Toaning or the year ended December 4 R2.25 million 1977 were K1,87 million for the previous previous year compared with Motos Corporation Corporation Proprietary Limited the : state cent Soude of as Alta diseprictave result k toa. te . bundertakes capes Hirose bundertakes ities Hirose : tuctin hela Division comm of Signa and products products " 64pm beray What wine ai Vereniging Vereeniging Refractories Limited AAC Group interest 1.73 per cent Vereeniging Refractories a subsidiary of Anglo Anglo American Coal Corporation Limited maniactures e gende variety of refractory bricks and materials for the alloy and other industries where heat is company manufactures building bricks Stalten pre stressed beams lintels and floor systemes systemes involved and associated associated companies are involved in the arantifochure arantifochure of concrete toot tiles and vitrified clay pipes and fittings for house drainage and sewers while others tuine raw materials used by the group The main works situated at Vereeniging $ ended December 31 1977 1979 Issued capital ordinsa harer s shy ares -50000 00 of 50 cents each 000 2500 cammlative edeemable preference sharbs 000 each Distallimable r^'serves Hong and deterred shabilities 1000 21048 1976 ROOD'S . 10057 10057 1000 : cee oy rad ak whakak Langhof largest nie pations pations in South stamills Dividends paid - ordinary Administered outside the Anglo American Corporation Group AECI Limited Though its in Debico Amic has an effective interest 10,5 cent in AECE ow produces group produces mining explosives and accessories ^ wide industrial Maicfontem Its main Sasolburg factories are situated Somersei West and Umbeginw~ ZUmbeginwA~ZA Coalples the company's based chemical complex commissioned in 1977. The project which 60/40 with Semrachem Limited pri~ ucespolyand a range of chemical products Canine Linted 1977 RAGLES 1976 RODO'S yor Corporationimited Dorman Fong Vanderbijl Vanderbijl Corporationimited of Cpation gering enginering group created united Africa engineering is 3o pet cem held and Sted iggestment were R135 million 197799976 197799976 R112 million : & Chemicals Corporation PMC PMC the opera opera ords minerals of uncalle uncalle bucating Freight Services Holdings Limited operates in United include South States Africa Europe the United of America and Australia forwarding baving the servicing servicing service group has a controlling interesS.tA. in sole Contantes Depobroprietary Depobroprietary Depobroprietary Limited which is the chitanchised container handling depot in South Antetican industrial comparare interest 40.34 per cent in company Limited has Gallo Africa Limited AAC Gnap equity interest -10.09 per cent and its associated companies ate engaged manufacture and distribution seconds and tapes music publishing and the distribution of television sets consumer electronic products audio- and visual exquipmeontht er related Year ended fune 1977 Issued capital dinary shares 25 of fully paid cents eat eat 25 182 700 cents each partly paid | six per cent cumulative -- preference shares 1 150 000 of R2 each premium and 976 RoQo's Long and deletdee letd ed taxation Fixed Unlisted investments Book value Directors valuation Equity carnings Dividends paid ordinary * Excluding not profit of Rock Rock on sale of investment Hall Longmore and Company Proprietary Limited AAC Grou i equity interest 4.32 per cent The company and its owned subsidiary manufcture Contractors Proprietary Limited engaged in the manufacture and distribution of Hallare steel pipes pipe fittings and other heavy steel produ^s in construction of pipelines Two other subsidiaries mamulactate and mammatic tools distribute drilling equipr^ ent and a Industex Proprietary Limited company manufactures various industrial textiles for the tre rubber other manufacturing industries spins cotton and synthetic yarns A wholly subsidiary Union Caton Milfs Proprietary Limited and weaving plant which of towelling products and cent Industex Industex J.L. Clark and Company Limited AM Group equity interest - 12.50 per ve The and subsidiaries suppliers of wide Hh airconditioning TT During engeration engeration and the company became Mecan Bimtek GroupBimtek Bimtek 4 . wae . , } Dinitel 245 per cent 4 ! + orporation i Inpack Products i cent interest in Rod's Rood's Je dee Ditectos vah Ditectos Eqquis catu werdinars ID 760 4085 The Union Steel Corporation tal South Africa Limited Uscor XAC Gromp equity interest - 2,9 per cent Us^'eownes steel works at Vereniging where where it puiduces led drawn longed and vase steel products as well as and Shuminium Shuminium conductors conductors and the whrdly whrdly and salsidiary factuces factuces Veldmaster Proprietary Limited di diss es ae nd os ther eartenghaging engaging subsidiary Usto Aliutum Con transmission Associated Copper rod and December 31 1977 operates an alumininay and Conductor plant at companies inanufacture du saved merchants s : ff 1976 Dued capital sday hates 010 at eventshates prgfcient YS R2 vach ich shares 125 00 Preferera B sharesshares ) ayy Distributalis toiv~ s bans Totem deferal and ROOMS 14505 20 14 35 250 230 2541 28811 250 24 177 332 28 100 10 5180 Ty 3596 1 i $ i . Tiger Oats and National Milling Company Limited AAU Giompeats Giompeats interest interest 4.74 percent percent invent holding comviny with asociated companies operating i l food feed agricultural fishing and pharmaceutical main activities activities are in hade wheat for Bully muiling the baking BS the anomdacture anomdacture of grocery products animal feed of ciggs broiler Union Curage Proquietarei Curage and Wagon Company a Lanted interests completed buildings are as tafet entre cape FawaFawa Percentage interest Cronie Photoria Photoria loliannesburg Audio Atuerkan Huperties Cani09 Lei b Medinip oan 100 : B Kenilwadi Proprictanky a ; . Centre Cope Tow at wordt wordt Shygsanuripet Johannesburg * tabannesburg Mall fohannesburg fohannesburg Johannesburg Pretoria Sandton City Sandion Centre Town Cape Shel Shell Town . Hoense Cape Town- 111 Panely Commissioner Street fobaturesbug fobaturesbug Airican Late Centres with alterests depuiends and Administered outside the Anglo American Corporation Group Main Place Holdings Limited AAC Group equity interest 27,95 cent Main Place administered by tobannesburg Consolidated company company owned owned subsidiary companies which own wd land west of the Magistrates Count the financial district of Hohannesburg is being held for latine development The Beunt Administered within the Anglo American Corporation Group African Eagle Lile Assurance Society Limited finterest 75,00 per cent company compacnompyany is one of the larges assitanice 4221 : South offering offering a comprehensive flexibde r^/nge Past Past Consoinated Consoinated Consoinated Consoinated oo Ligutad Mainstraat Beleggings f lifcents cach 1977 1676 . RODO'S ROOD'S pricinior each 43 730 3 750 517 312 150 260 503 Hokings Fanted ordinary Admanistered outside the Anglo American Corporation Group . service fighat soundiern soundiern Contenci Contenci trade finance fordia fordia development and com supplemented by banking bite insinance 1976 Barlow Rand Limited NAcaitonghenpally NAcaitonghenpally a asociate C.T. Bowring Bowring and Associates Associates Holdings South African Limited AAC Group eqquits interest 50.00 per cen various subsidiaries and associated companies company conducts insurance broking operations in Republic of South Alia South West Africa and Issted ordinary ordinary shares RI each 000 A class cumulativecumlative prefetener shares - of RI cach 16 class non cumulative preference Shares - 2 of 81 each Share premit,,and reserves Equity.camnings Equity.camnings Dividends paid -ordinary preference 1977 Rood's 2 1976 R000'S 50 50 .R2 . . K2 49 1084 980 226 RZ K2 388 878 790 226 Gold Fieldy of South Africa Limited equity interest - 3,31 per cent A mining Substantial companies companies finance and exploration company with holdings in gold and uranium mining Base ninetal industrial and property Year ended June 30 1977 1976 Isstred capital 301 ordinary of shares cents each Share premium and reserves lovestments RODO'S R000's 4075 146 137 4075 4142 787 POINT - a Book value Market value Unlisted . 142919 391898 391898 113531 448 546 Book value Directors Directors Equity valuation : 5832 12448 12448 21733 17932 5318 900 694 15.263 15.263 1976 Boon's AAC Group equity This investment interest interest - 19,00 cent which a subsidiary of was formed in 1963 bAnglo Coporation and Federale Mynbou It has a shareholding General Limited Mining and Finance 101 Nullack Nas at we q ; we ae * . i * a : we . . . Tanganik Concessions Service Naministered within the Anglo American American Corporation Group Prospecting Prospecting : Prospecting : ProspectingProspecting development development development located in Welkom . Angle A , Shaye Be carers . set " Sabri t tis Latel Pr hau ra Anglo Americar Corporation Botswana Services Proprictaavi Proprictavi Limited Botswana gregsgasible for the Amerkan comporation domiciled in touse an office building company West End administration of administration the De Bees gtomp and operates ito in Lafayette onsned onsned Property Company . : oe ts ' jeed Bo at i wd American Prospecting Prospecting DAanithad Services Services ny oa Thats ves Munscargh Munscargh Surveys Limited } Anglo American Property Services Proprietaryi Limited AA Gequity Gequity interest Jed per cen company administrative associated provides teclical management and services to property companies within with the Anglo American Corporation Corporation Mine ServiSc ere vics es O.F.Si Pioprietary Limited The company suppites stores and Diaterials to gold mming kompanies in the Orange Free State and the Fralisvaal associated with the Anglo American CosporaBort Group Pulspecting Pulspecting Ventures Limited abur Housoef South Attl Statutory and other information Special resolutions passed by subsidiary companies of Change na NG awd Amendments of Association Association o Boei Botic Botic 4 / WE Hefraeyt . 2 PER Leven Madve 11. Mackenze Beneficial 10000 100 cate cate 130000 00061 31400 2028 15.000 30.000 30.000 00001 000 30.000 700 15.000 ! . 300 317100 DEARIO 15,000 000 15000 15000 2000 15000 ad 15.000 15.000 50000 15.000 15.000 15.000 Non bene ficial Option tb acquire 5.000 100 petty 100 7900 7.000 1000 100 4.500 100 2.000 100 000 8000 10 000 9.000 9000 000 1000 u Son 500 Paks 000 100 001 100 2.000 Leno 4000 100 100 100 hes hou 5.000 1.000 7000 McKention B McKention CDM CDM Melville Melville D & Max DG Nichdson O'POW 11 Oppelteniei Oppelteniei 7 19000 19000 151488 151488 15.000 15.000 201 30-000 15.000 18333268 18333268 18333268 finchades 565-351 565-351 Registered 100 ~ - 100 000 - 5.000 0000 2600 7 0 4 Philip Oppenheimer Pam : GWH Sa Roltisou MW Stegtheipon 1.6 Striplane Sackville + Lavior gille gille Thompson 1.200 47.199 47.199 ** 430 - 50.000 : 15.000 00011 1 200 | 00 1000 100 18.000 18.000 9000 1000 14.0 14.000 FindIndes FindIndes 000 registered 1500 1500 - 15.000 11.060 11.060 30 90 10000 12380 7.000 01 000 Coperation of The directius directius taunth is not aware the interes interes extem if helt nder a share incentiveincetive scheme th" 103 5 css oo . HEAD OFFICE PO Box Telex 7167 Telephone Blendete Blendete Building SPECT Telex 3348 SPECT BA Telephone Betsalane House af ?! Brazil Anglo American 538-2000 Rhodesia 70 Jainese a crue Central Salisbury C.4 ' Telex 4113 Telephone 70446170461 a Managing Managing Secretary Rhodesian G EBain United Kingdom 40 Holborn Viaduct Telex 27529 London ECIP TAL , England Telephone 3531545 . - Tondon Secretary DS Booth aa Zambia Anglo American Corporation Central Africa Limited 74 Independence . Tel . ZA 41190 Telephone 3000 Secretary M Casey pidiary . SHARE TRANSFER SECRETARIES olidated Share Registrais limited * Marshall Street Johannesburg 2001 ONE Box 61051 Marshalltown 2107 2107 Charter Consolidated Limited PO Tae R Anglo 4 28 PO Box Telepline 3622192 , Senior Vice President . and General Counsel R. Charter France S.A 9 Rue de Vienus Telex 28030 Telephone 5223484 Secretary RS Robertson w . Luxembourg Anglia Finated . : Telephone 4016 Secretary Secretary Lade logiga logiga Liston NARI reports companies Members of the Corporatioit wish Corporatioit Who Who wish receive copies the annual reports and accommis of quoted companies associated with the Corporation Corporation may obtain upon application the i Managing Secretary or in London Secretary Secretary the ! Corporation Changes Changes of address should be notified to the f ANGLO AMERICAN CORPORATION OF SOUTH AFRICA LIMITED Incorporatedin the Republoifc +. Company Registration No. ofSouth Africa 0530906 | 61st Annual Report Containing the financial statements inin respectReportthe fifteenmonths ended March 31 1978 2 Introduction . The year in 4 brief ' Directorate 6 Group administration 7 Directors review 9 - Annual financial statements 45 year financial statistics 75 Interests of the Group 77 Subsidiaries resolutions Directors shareholdings 103 ee ec a verlang Aandeelhouers wat Afrikaanse vertaling van hierdie verslag 4 am met die oordragsekretarisse oordragsekretarisse in verbinding te tree word versock : Introduction j wy The Corporation its relationship to the Group and to it's major associates Anglo American Corporation is the head of an international group of mining industrial and investment companies whose overall size is estimated at approximately R5 600 million With effect from January I . 1977 the Corporation was considerably enlarged through * a merger with Rand Selection Corporation The mining finance houses in South Africa have traditionally operated the group system whereby the parent house not only administers companies that are not necessarily subsidiaries but also -provides them with a full range of administrative technical services and is able by virtue of its financial strength and standing to De assist them finding capital for expansion and development Beers Consolidated Mines and Charter Consolidated Consolidated though not members of the Group draw upon the Corporation's technical 4 services an hi It has therefore become customary for term group to have ~ wider meaning in the South African mining industry than its statutory definition of parent company and its subsidiaries and it is in this wider sense that it is used in this introduction introduction in The year in brief onon pages 4 and 5 and in the Directors review on pages 9 to 44 However in the audited annual financial statements on pages 45:40 74 and in the section Interests of the Group on pages 77 to 102 the term is useidn its statutory sense to refer to the Corporation and its subsidiaries wee ~ which is The Group's structure is outlined in the chart which shows the significant shareholding relationships between the Corporation and the principal finance and investinent companies of the Group and i between . the Anglo American Group and its two major associates De =, 7 Beers and Charter The figures printed outside each circle show the percentage interest in that company held by another Group or associate for example Anglo American company Corporation holds 36 per cent of Charter which turn has cent of Anglo American and 20 per cent ofMinerals and Resources Corporation Minorco The business of Anglo American Corporation is to invest in production ~. companies many ofwhich administers and develops In mining the _, Anglo American Group and its associates have important interests in the of gold and uranium diamonds copper and nickel coal platinum tin potash asbestos iron ore lead zinc manganese and wolfrain The Group's industrial interests range from and heavy engineering to construction motor vehicles pampear kanid ng textiles chemicals drilling tools refractories and foodstuffs The principal commercial interests are banking computer services in southern Africa freight and travel insurance and property The Group's investments are held mainly through the specialised companies identified in the chart such as American Gold Investment Company Anglo American Investment Trust for the marketing diamond mining and investments and Anglo American Industrial Corporation The majority of the coal mining interests are consolidated in Anglo American Coal Corporation Minorco based in Bermuda participates in the Group's international mining and industrial interests while on a geographical basis there are Anglo American Corporation of Canada Amcan Anglo American Corporation Rhodesia Zambia Copper Investments Australian Anglo American Anglo American Corporation do Brasil The valuations given the chart are calculated as at March 1978 Anglo American Corporation has had only two Chairmen the founder Sir Ernest Oppenheimer from 1917 1957 and the present , Chairman his son Mr Harry Oppenheimer This has brought a continuity of policy the activities of the Corporation whose aims - to earn profits for its shareholders but to do so in such "' way a the make real and lasting contribution to the welfare of areas and countries where it operates e Africa 5 The Corporation's roots are firmly planted Africa where began of its interests there both in mining and in a wide indusitndrusitreiess are continuing to grow But its resources are also being applied | internationally in mining and related fields through Minorco Charter and Amcan Geological exploration similarly has become The Group and associates are involved in prospecting programmes in- Africa in North and South America in Australia and in Europe The Corporation's original ; in raised capital ; 1917 was million which was raised from British American and South African African sources hence the title Anglo American Corporation of South The present Africa presnt capital and reserves exceed R860 million and the Corporation's 4 investments at March 31 1978 were valued R2 269 million To illustrate the scale its mining operations 1977 the Group Africa's was responsible for over 37 per cent of South Africa's gold output equivalent to about 27 per cent of world production ( excluding communist countries for 33 per cent South Africa's and coal and per cent ofits uranium copper mines in which the Group accounted is interested for 13 per cent of world production in 1977 Following the merger of Anglo American Corporation Rand Selection registered ordinary shareholders increased by 8 000 more to than 24 000 while bearer certificates in issue increased by 7.000 nearly 45 000. The majority of the share capital held in South Africa with most of the balance held in the United Kingdom and other 7 European countries . >> ANGLO > AMERICAN INDUSTRIAL CORPORATION Market value of capital 228327 327 000 - CORPORATION ee Market value of cy equity capital Boec ANGLO | BH AMERICAN cee --0 PROPERTIES Market value of ee yoling capital A R13 000 eR EE AUSTRALIAN ANGLO |. AMERICAN ZAMBIA COPPER ~~ AMERICAN CORPORATION Q INVESTMENTS shareholders RHODESIA <: Market value of terestt Equity shareholders : * equity capital 000 _ interest | USS18 021 000 aS, AS12 ee * R 487 Market values and equity shareholders interests are as at March 31 1978 Underlying net asset value As from January 1 1977 Rand Selection Corporation was merged into Anglo American Corporation to form a mining finance house very great strength The merger was accompanied by a change in the Corporation's year end to March 31. Net equity earnings for the month period to March 31 1978 were R195 million while earnings per share were 89,9 cents Dividends totalling 45,25 cents a share comprised a special dividend of 8,25 cents an interim dividend 12 cents a and final dividend of25 cents a share If Corporation's of share the undistributed profits fromits investments in which it or its associates directly or indirectly holds 20 per cent or more of the equity or which are administered within the Anglo American Group were taken into account the estimated total earnings for the 15 months to March 31 1978 adjusting for crossholdings would be aafter approximately 178 centsshare compared with 132 cents a share for the months to December 31 1976. Earnings for the month periodto March 1978 based the number of shares effectively in issue during the period would have been approximately 70 cents share the underlying earnings approximately 142 cents a share charge of R33,5 million the month period was made under extraordinary items in respect of the Group's investmenis in Soci^'t^' Fungurume Mini^rede SMTF and Botswana RST BRST INVESTMENTS INVESTMENTS 2 . The value the Corporation's Corporation's listed general investments R1 997 million at the year end An analysis by primary source and geographical location of the Corporation's direct investments the underlying investmeints nvestments of the holding companies in which it is interested is given opposite The analyses 1978 and 1976 are not comparablein view of the consolidation of Rand Selection for the first time the change in the financial year and the higher than normal ' flow of income in the quarter to March 31 each year The value ofthe direct interests of Anglo American Corporation and its associated the +- finance companies listed on page 12in mining finance industrial andproperty companies administered by the Corporation was ~ approximately 700 million at March 1978 while the estimated - total value of these administeredcompanies was about R3 700 million of The value the direct interests of the Corporation and its associated finance companies in non administered companies amounted to R1.900 million This brings the value of the direct interests of the Corporation and its associated finance companies to about R3 600 million and the overall size of the Group being the aggregate value of the administered companies and the direct interests in non- administered companies to about million By prime source Value of investments Percentage 1978 1976 43 34 19 16 6 17 Other mining Industrial Finance 7 Property .... Oil and gas 100 100 Geographical South Africa South West Namibia . . . Rest of Africa south of the equator ., of seen North America ../f......06.. Elsewhere : : a) Investment income ' Percentage 1978 30 1976 32 32 8 1 8 100 100 70 70 8 6 Excluding intereists nterests attributable to outside shareholders shareholders shareholders in subsidiary companies dividend was reduced Anamint's earnings by 15 cents to 165 cents a share | for the year ended March 31 1978 rose to R64,6 million and the dividend increased by 46 per cent cents a share reflecting the further improved earnings of De Beers Consolidated * Mines ; Amic was affected by the depressed economy and by the sharp drop in the markets for timber related products Net equity earnings declined by 5.5 per cent to R40,6 million and earnings per share by nine cents to 151,1 cents for the year ended December 1977 However in view of the increased earnings achieved by the main subsidiaries Boart International and Scaw Metals and the improved outlook for the timberthe dividend was increased by five cents to 70 cents a share Amcoal experienced another highly successful year with net earnings improving 68 per cent to R47,3 million the dividend increasing by 50 per cent to 60 cents a sharefor the year ended December 31 1977 INVESTMENT COMPANIES : : The principal administered investment companies include Anglo American Gold Investment Company Amgold Anglo American Investment Trust Anamint Anglo American Industrial Corporation Amic and Anglo American Coal Corporation Amcoal improved Despite an gold price Amgold's investment income declined by 3,7 per cent to R45,2 million as a result of increased working costs and expenditure incurred by the gold mines Net earnings for 1977 were R3,8 million less at R41,5 million and the 5,7 GOLD AND URANIUM Although the tonnage milled increased by 5,7 per cent lower recovery grades resultedin further decline in Group gold production by 3,1 cent to 262 408 kilograms Despite lower production and a 14,6 per cent increase in unit costs working profit profit improved by 12,3 per cent to R433,9 million because of the higher average selling price of R4 082 a kilogram or about 146 an ounce Taxation and State's share of profits absorbed R160,2 million or 36,9 per cent Two new gold and uranium ventures East Rand Gold and Uranium vant x 4 i - a . , Ny e a * 3 , od 9 , uo ka 4 We \ ft : i . : FEATURES OF THE CONSOLIDATED FINANCIAL STATEMENTS Issued ordinary capital and reserves *.2. _Listed general investments . nS 0.200. vee. ee. ee value eo Market value " .2 2. ee eee eee lle cece ae eueeebeeces a eet ee easly eee e ete Unlisted general investments Book value 2.02 a.) Directors valuation Investment income - general investments ; co *: Equity earnings ns during effectively per share 1978 based on 217 068 082 shares in issue the fifteen months MO ......... eee cee eee Q eee Dividends on ordinary ce cc0 shares02.00 c .0 e 0 e . share per share 1978 includes a special interim of 8,25 cents a 8 Number of issued ordinary shares 9 z yw B Marc3h1 1978 R000's 319 0 . 713 779 1996 731 121 796 * 296 * 179 036 89,9 cents 99 132 45,25 cents 222 964 532 Decembe3r1 1976 R000's * 469 692 December 1975 R000's 447 802 . 411.009 934 221 353 857 997 842 4 679 164 968 3 168 059 . 181 235 246 94 992 oF 65,3 cents D# : 43 465 428 : 64,1 cents 43 449 33 cents 33 cents 131 725 300 131 672 300 By io bol nt re oo 1 Company afid the Joint Metallurgical Scheme initiated by the Group's commissioning period a Orange Free State mines began during the price has recently recovered slightly prospects for material increase during the next 12 months * under review The Elandsrand gold mine is well ahead of schedule are not encouraging -% _ Nchanga Consolidated Copper Mines and Roan Consolidated : Mines and is expected to come production in 1979 a" i Production uranium from Group gold mines increased are incurring substantial losses with operations continuing to be . by 32,9 per hampered by shortages of skilled staff of components and the 5 cent to 1533 tons Pe > closure of the Benguela railway outlet to : Lobito 0 : te , - iz _ Hudson Bay Mining and Smelting reported consolidated earnings of ' DIAMONDS re ee CS4,4 million excluding an extraordinary 52, 526 ,6 million from industrial diamonds of Sales of rough gem and by the Central Selling the sale of its potash assets in Saskatchewan Earnings which were =." Organisation increased by 33 cent during 1977 to reach a new a, metal record of 073 De Beers Mines adversely affected by weak and fertilizer markets nonetheless more to eey. . million ~~ Consolidated than improved 1977 largely because Hudbay's petroleum subsidiaries = its doubled consolidated earnings to R623 million equivalent to * Francana Oil & Gas and Canadian Merrill benefited from product 172,7 a deferred share another extremely successful year The production and higher increased prices Two new base metal mines e net diamond higher account rose by R300 million to R751 million because of - were brought into production the Flin Snow cE erie! the higher volume of sales and the price increases in Lake area tay! September 1976 bk ' March and to a lesser extent December 1977. A record total \ INDUSTRY . of 52,5 35 Highveld Steel Vanadium Corporation dividend one cents a share 1976 cents was paid Total mine and again reported improved mnt 1 262 output increased from 1976 level 000 carats to 11,8 iy million > oe. results for the year to June 30 1977. Net equity earnings rose by R4,8 os A V2ee8:% million to R20,7 million with earnings per share increasing by 12 per ae COAL : cent to 30,6 cents The successful commissioning ofa plate mill me of tee nie H with enabled Highveld enter new sector of the local market as a second Higher export earnings and a domestic price increase were mainly supplier Notwithstanding difficulties in the international steel responsible for improvement nearly 50 per cent the tax market Highveld maintained we earnings of Group collieries to R73,7 million Amcoal satisfactory exports fe 30,6 per cent to R259 million turnover rose by Despite difficult trading conditions and adverse foreign currency Amcoal's new Kleinkopje mine is movements Boart International increased earnings by 6,7 cent to ; expected to produce its first coal at the end of 1978 the total cost R17,5 million in 1977 per with R16,1 4 remaining within the capital budget of R109 million ~ feta : Scaw Metals increased earnings for 1977 by 10,6 cent to j: With coal exports R248,5 million in 1977 coal ranks after gold and million : per R16,1 . ce , diamonds South Africa's third largest contributor to export turnover OTHER MINING . - Depressed copper prices during the year continued to impair earnings from the Group's copper interests the London Metal Exchange ne Consolidated net earnings of Mondi Paper Company and its major subsidiary South African Board Mills Limited rose by R1,9 million to R10,2 million despite a reduced local demand for newsprint a 15 per cent surcharge on imported raw materials and generally adverse trading conditions : Ethen u & 2 Motry eo . eee name i . 3 | wncetmemngaie CHAIRMAN HF HF Oppenheimer DEPUTY CHAIRMEN Sir Keith Acun British GWHGWH Relly DIRECTORS WG Boustred = JN Clarke British Dr ZJ de Beer MP DA Etheredge OBE " GC Fletcher MC HR Fraser British CJ Griffith EP Gush M Hofmeyr JA Holmes British G Langton DG Nicholson British NF NF Oppenheimer : Sir Philip Oppenheimer British BW BW Pain British . Sir Albert Robinson British' LG Stopford Sackville British JOgilvie JOgilvie Thompson GH Waddell a WD Wilson ~ Executive director Qendeee ALTERNATE DIRECTORS a se Dr * GM Atniore * BE Bullett British ije GA Smith British ea H K Davies -- a ape Dr B Dyer woe WJ Hefer ood = Lee Hoffe FJA Howard ha . JD Johnson British A Johnstone MW MW King O'P.Koevort O'P.Koevort 2 PJR PJR Leyden British - DE Maclver : JLP Mackenzie A McKerron CD Melville Dr LG Murray MC O'Dowd MW MW Stephenson British JD JD Taylor Canadian VI VI Webber British , A Wilson 2 \ % ze fe ' oO tt + . CHAIRMAN'S CHAIRMAN'S OFFICE OPERATING OPERATING COMMITTEE GWH Relly Chairman JOgilvie JOgilvie Thompson GH GH Waddell MANAGEMENT N Clarke DrJ Beer JF JF Drysdale Se . = : G Fletcher D Hoffe fe tao: oO : : JA Holmes DG Nicholson Sy MCO'Dowd MCO'Dowd os C,HIEF PERSONNEL CONSULTANT E N Cathrine os ook ECONOMIC CONSULTANT ABDickman GROUP COMPUTER CONSULTANT : M Cowley : ? _ MANAGING SECRETARY 5 Goldfinch aie Peg PUBLIC RELATIONS CONSULTANTCONSULTANT BRBR Mortimer - Finance Office ia DIRECTOR JN JN Clarke : MANAGERS JMP Desmidt | Johnstone MW King CHIEF ACCOUNTANT ae Leeman International ordination Office MANAGER oe : JDTaylor ~ Manpower Resources Office ore MANAGER JF Drysdale = PERSONNEL CONSULTANTS CWH du Toit TG Mann EN D.Morgan| Worth SENIOR MEDICAL CONSULTANT DrJ LC Whitcombe MEDICAL CONSULTANT ~ Dr Laing Technical Ollice : DIRECTOR JA JA Holmes DEPUTY TECHNICAL DIRECTORS .. Dr M M Atmore JD JD Johnson : > DE Maclver " : JLP Mackenzie Dr LG Murray M W Stephenson METALLURGIST CHIEF CONSULTING METALLURGIST D Deuchar : CONSULTING ARCHITECT DR DRYetton CONSULTING CONSULTING CIVIL ENGINEER DW DW Standish " . CONSULTING ELECTRICAL ENGINEER HM Brown : 3 CONSULTING GEOLOGIST Dr FWD Cornwall . ' MINING VALUATION CONSULTANT HM MacLeod . : HEAD OF TECHNICAL SERVICES ery : > J Dyer Oo RESEARCH DIRECTOR : James ue are? : ~ OPERATING DIVISIONS Boart International CHAIRMAN . -* Fletcher MANAGING DIRECTOR H K Davies CoalCoCaolal CHAIRMAN WG Boustred MANAGING DIRECTOR TAJ TAJ Braithwaite DEPUTY MANAGING DIRECTOR D Rankin ' CONSULTING ENGINEERS F Chilton P. Coetser JD Flint DF DF Rogans CONSULTING GEOLOGIST DAM DAM Smith D a CONSULTING MECHANICAL AND ELECTRICAL ENGINEERS JM Kinghorn GO Parnell . CONSULTING METALLURGIST HS Schwartz ENERGY CONSULTANT RL Cohen . FINANCIAL DIRECTOR . JAB JAB Nichols SALES AND MARKETING SALES DIRECTOR o ~ DJ Ritson PERSONNEL CONSULTANT - DB Wiggill oo Le Commerce and Industry = CHAIRMAN CJ Griffith MANAGER O P.Koevort " = a Diamond Services | CHAIRMAN JOgilvie JOgilvieThompson Q MANAGERS Dr H.B Dyer Leyden A Wilson : : : : > CONSULTING CONSULTING A K Chant - ENGINEERS SF SF Gandar T Jones = : . JC Martens CONSULTING GEOLOGIST Dr G Murray CONSULTING MECHANICAL AND ELECTRICAL ENGINEERS .. 3 LAMacKinnon KJ KJ Trueman CONSULTING METALLURGISTS G Schwartz' JF JF Slabbert FINANCIAL DIRECTOR " L Lincoln PERSONNEL CONSULTANT CN Cross Food and Agriculture CHAIRMAN WJ WJ H^'f^'r 4 ae) Gold and Uranium CHAIRMAN D Etheredge MANAGING DIRECTOR AND CHIEF EXECUTIVE G Langton ae : boos lee , DEPUTY MANAGING Lawrie oo MS McCrum DIRECTORS : GY Nisbet G'S Young - 4 BY - CONSULTING ENGINEERS FJ Bayley . L Hewitt _ i Pa D M. Rood E Schmid b ET Wilson CONSULTING GEOLOGIST (3~ Dr Pienaar CONSULTING Mechanical and ELECTRICAL ENGINEERS - Glover 7 G Griesel KN Love CONSULTING METALLURGISTS R Pendreigh WT WT Ruhmer FINANCIAL DIRECTOR * GM Holford MARKETING DIRECTOR NF Oppenheimer > . PERSONNEL CONSULTANT SW der Colf : ' Heavy Industry . _ CHAIRMAN W Boustred = nal =. Insurance . CHAIRMAN _ GWH Relly * EXECUTIVE CHIEF . . _ Nicholson _ New Mining Business | . CHAIRMAN 4 AB McKerron ae CONSULTING ENGINEER __ NJ Keys CONSULTING GEOLOGISTS 4 Dr P Pienaar Dr A Smith = ae) Property CHAIRMAN GH Waddell MANAGING DIRECTOR CDM Melville REGIONAL OFFICES Australia . : EXPLORATION MANAGER 8 RJA Kernick at 6 fi Botswana Botswana MANAGER ND A Hardie Brazil CHAIRMAN Dr E MAF Ferreira r's Pen MANAGING DIRECTOR - ; PCD Burnell i ; : Canada _ * CHAIRMAN HR Fraser PRESIDENT Push FINANCIAL DIRECTOR M Doull : Rhodesia . CHIEF EXECUTIVE GA Smith vy ' MANAGERS E Bullett de Zwaan RJ Hedley CONSULTING ENGINEER TL Pretorius : ~ CONSULTING GEOLOGIST _ E Hyman 8 . . ; a CONSULTING MECHANICAL AND ELECTRICAL ENGINEER JH Moll CONSULTING METALLUrgist PJ Mostert & United Kingdom 3 LONDON COMMITTEE M Hofmeyr Chairman Sir Philip Oppenheimer W Pain JG Richardson LG Stopford Sackville CONSULTING ENGINEERS JV Cleasby A Smith HJ St^...cke CONSULTING GEOLOGIST GEOLOGIST CONSULTING GEOLOGIST ~ Dr Osten CONSULTING MECHANICAL AND ~ ELECTRICAL ENGINEERS MECHANICAL A W Purkiss S Sheer . CONSULTING METALLURGIST IR Chaston . Zambia j Zambia if MANAGING DIRECTOR VI ; Webber 5 TECHNICAL DIRECTOR - MW.Stephenson MW.Stephenson CONSULTING ENGINEER MP MP O'Connor ')CONSULTING GEOLOGIST Dr PV Freeman . CONSULTING MECHANICAL AND ELECTRICAL | : A GV Pearce oe * CONSULTING METALLURGISTS B Barlin JD Parker , . wy 2 ; S 4 ao Oo *. ai g # ie oe: 3 am &. 2 tod 5, onl a Directors review a 4 oo a a .. Finance andinvestment 11 2. Gold and uranium 16 Diamonds 22 oe Sng hoe oa ; Coal 26 . Other mining 28 ~ Industry and commerce32 Property 41 5 : aa . . Exploration and research 41 & & The Chairman H Mr F Oppenheimer and the Minister ofMineral Resources Government and Water Affairs Dr G Chicpe at the official signing ofthe agreement : between DeBeers and the Botswana . to proceed with the developmentdevelopment ofa new diamond mine atJwanengin southern Botswana i Finance and investment extraordinary charge of R33.5 million was made against profits respect of the investments in Soci^'t^M' ini^reFungurume Rand Selection SMTF Botswana RST Limited BRST Although the Corporation andRand Selection Corporationin their financial years provided merger completed Oe a total of R30 million against their investments in SMTF it way Theperiod undoubtedly the difficult most The under review was one of considered prudent as base metal have shown evidence of ever faced by South African business Anxieties ia concerning political prices no sustained recovery and little progress has been made with the alterna- ginh ? developments in southern Africa continued * affect confidence : tive of a smaller scale project to makea further provision of R10.4 particularly country's overseas the ability to adopt policies that million against this investment so that the book value been aL. would foster stability and growth As result there was a large net provided against full The Shaba province of Za^flre in which the orebody surplus outflow of capital and although a was achieved in the balance SMTF is is located invaded by Government forces edie the of payments on current account foreignreserves remained low and May 1978 the town of was in with the aid of Inflationary Kolwezi recaptured litle therefore remained a critical constraint on policy French and Belgian troops . been reached abating agreement ~ pressures showed little sign of andin consequence there was a 0 BRSTrecently reported that had gre tightening _ further earlyin 1977 of therestrictive monetary and fiscal the principal shareholders the Botswana between and the Government principal measures that had been introduced the previous year The effect on project lenders fortheorganisation of the financial a virtually real domestic spending was severe and all sectors of the structure and sales arrangements of BCL Limited operator of the economy were exposed to exceptional strains that were widely reflected lower copper project at Selebi Phikwe in Botswana in which BRST in profits and rising unemployment conditions holds an 85 per cent The major effects this re interest burden organisation - were to some extent mitigated by the outstanding agricultural season will be to reduce BCL's interest and improve flows by accelerating the good performance of gold mining exports and the firming of receipt receipt of sales proceeds as well as removing the requirements half thegold price particularlyin the second of 1977. By the end of the obligation to produce sulphur as part Phase 1 j year some business cycle indicators were implying that the declining * Although production levels increased substantially during second cane of phase had ended prospect that was further improved by the half 1977 the prices of nickel and copper remained depressed and 1978/79 Budget whichaims selectively to stimulate the economy BRST gD In circumstances recorded a loss before extraordinary charges of P3,7 million of , these gt the Corporation'sCorporation's results weresatisfactory million the ended December 1977 the light of Comparisons Oo 2 factors full 7 with the previous year are not meaningful because reflect the the these it has been considered sound to make a provision as figures consolidation Rand Selection Corporation Limited an extraordinary item of R25,9 - the investment in * abe BRST March million into AngloAmerican Corporation from January t 1977 to form - at 31 1978 2. against value a single mining finance houses considerable strength and status in Themarket of listed investments at March 1978 million gyre world capital markets The simplification simplification of the structure the Cor- Ri 996,7 was an excess of 282,9 million over the book value of 996,7 poration its subsidiaries also offered the benefits of rationalisation valuation end the which became manifest million The directors of unlisted investments at valuation during the year The merger was accompanied year was R272,3 million = is March of Anglo Corporation by change the Corporation's year to 31 on which The value of the and 1978 the combined assets of entity R2 296 its associated American exceeded companies million finance listed on page the mining | > = - finance | and property companies administered by the that industrial The comments follow relate to the consolidated - income Corporation was approximately RI 700 million at March 31 1978 statement balance sheet of the Corporation and its subsidiaries while the estimated total value of these administered companies was equity Net earnings for the month period to March 31 1978 were about 700 million The value of the direct interests of the Corpora R195 million 1976 R86 million whileearnings pershare based on tion and its associated finance companies in administered of the effective number sharesin issue during the period under review companies amounted to RI 900 million This brings the value of the under were 89,9 cents 1976 65,3 cents General investmentincome direct interests of the Corporation and its associated finance com- amounted to R213,2 million 1976 R87,2 million and net income panies to about R3 600 million and the overall size of the Group being from fees interest and other sources after deducting administration the aggregate values of the administered administered companies and direct expenses and interest paid was R37,9 million 1976 R19,2 million interests in administered companies to about million profits Trading of companies which became subsidiaries as result of was announced March1978 that in order to finance the merger amounted to R9,6 million The surplus on realisation of ongoing commitments the Corporation had made general > investments amounted to R18,1 million 1976 R2 million raise R40 million at 10,5 cent means of a _ arrangpelmaecnitnsg toof private Prospecting costs for the 15 months amounted million 1976 cumulative redeemable preference shares The shares which will not R9,5 million taxation absorbed R17 million1976 R4,6 million carry conversionrights will have average life of about eight years Company Ordinary dividends totalling 45,25 cents a share were declared for the Anglo American Gold InvestmentCompany Limited Amgold ~ month period compared with 33 cents a share the year ended December 31.1976 earned netprofits of R41,5 million in 1977 R3.9 million less than previous year Despite an improvement the price of gold the sharp . n The central plant complex at Ergo near Springs on the East Rand with the South African Land & Exploration mine in the background background During November 1977 Ergo received the Rand Daily Mail's business -, achievement award in recognition of its outstanding contribution the development of the South African economy Financial year ended Net asset value based on consolidated consolidated balance sheet fh Consolidated tax profit loss after and outside interests e Equity earnings per ordinary share Dividends per ordinary shore ; we Anglo American Anglo American Coal Corporation 1977/78 1976 1977/78 March 31.1978 ' .. December 1977 million million million 296,62 R195,33 R167,8 > R153,02 R47.3 1976 ; 1977/78 cents 89,94 201.3 1976 cents 65.3 120,0 1977/78 cents 45,253 60,0 1976 cents 33,0 40,0 Anglo American Corporation of Canada December 1977 Anglo American Corporation Rhodesia ee June 1977 CS93.16 RS68,46 Anglo American Gold Investment . : December 31 1977 Anglo American Industrial Corporation .. December 1977 Anglo Investment Trust ...... March 31 1978 R749,7 R332,72 R617,62 Minerals and Resources Corporation ..... June USS408,66 CS93,46 2 78,96 e R632,72 R301,92 3.3 RS4 1,7 RS4,2 R41,5 R40,6 R451,8 R451,8 487,5 R64,6 USS 12,7 Zambia Copper Investments .........6. June 30 1977 239,66 . USS270,26 USS1,2 . : 33,5 6,0 .189.1 151,1 643,3 io ~14.67 206.7 160,0 438,2 a US 43,5 5,0 .165.0 C 40,040,0 3,57 3,57 3,57 180,0 70,0 65,0 600,0 410,0 12,0 ~ 2,0 -- Notes 1 Following the acquisition Rand Selection Corporation Limited the results of the Corporation include for first time the operations of the RRandand Selection Group and .52,2 per cent of the operations the of down table : Anglo American Investiment Trust detailed further 31 * 2 period ended March 1978 * Based on of numbse harr es effectively in issue during the fifteen months Excludes equity accounting for effectively controlled companies Listed investments at market value and unlisted investments at book value Adjusted a to show effect of capitalisation during 1977 Dividends share compared with 180 cents the previous year The market value of listed investments increased by 24,1 per cent R760,8 million reflecting higher share prices the acquisition of further Elandsrand GoldMining Company Limited following| the rights by that company in January 1977 and folwing the capitalisationofloans to East Rand Gold and Uranium Company Limited which resultedin 20 per cent interest in that company Angold hasarranged to raise R25 million also 10,5 per cent by a private placing of redeemable cumulative preference shares having an average life of about four years The funds will be used to reduce short- term borrowings and to finance new investment commitments Anglo American Investnient Trust Limited Anamint which holds 26,37 per cent of De Beers Consolidated Mines Limited invest- ments in various unquoted diamond trading companies became a 52,16 per cent held subsidiary of the Corporation as result of the merger with Rand Selection Corporation Equity carnings the year ended March 31 1978 were R64,6 million compared with R44 million in the previous year The total dividend increased by 46 per cent to 600 cents a share At the year end the book value of Anamint's investments was R58,1 million compared with market and directors valuations totalling R612,5 million In common with many other industrial companies the carnings of Anglo American Industrial Corporation Limited Amic were affected by the continuing economic recession equity earnings fell by 5,5 per cent to R40,6 million for the year ended December 1977 and earnings per share decreased from 160 cents 151,1 cents because of the sharp decline in the markets for timber and related products Since the year end discussions have taken place among producers these industries which should result in a return to profitability in the current year In view of that and together with the excellent results from Amic's major subsidiaries Boart International Limited and Scaw Metals Limited and the improved income from its portfolio investments the final dividend was increased by five cents making a total dividend for the year of 70 cents a share The Corporation's significant investment in the life assurance industry is held through Anglo American InsuranceasurancHe oldings Limited AAIH which comprises African Eagle . Life Assurance Society Limited Guarantee - Life Assurance : Company | Limited and Southampton | Assurance Company of Rhodesia Limited The rationalisation programme introduced since the Corporation acquired control of the assurance companies is now beginning to take effect Over the past 18 months AATH has successfully revised its new business product range particularly with 'the introduction . of specialised products for Guarantee Life and an innovative pensions investment vehicle which has been adopted by African Eagle Life Total assets of AAIH at March 31 1978 amounted to R717,3 million compared with R650,8 million months ago Premium income 12 SS N 8 a Rane AG Seer bee rte Sere oes Directors review Sterling weighted average (a Deutschemark US dollar {Devalution} Swiss franc 22 eptember growth has been satisfactory and reached R147,4 million over the same period Anglo American Coal Corporation Limited Amcoal reported 50 per cent improvement in pre profits R74,7 million for the year ended December 1977. Coal sales increased by 11 per cent to 25,7 million tons and group turnover at R259 million was 30,6 per cent higher in 1976. During the year a tax equalisation policy was adopted by the coal mining subsidiary companies for major capital expenditure programmes An amount equivalent to the tax benefit arising from major capital expenditure during the year is set aside from income and is then credited to income over the estimated lives the projects concerned Thus R17 million was provided for tax equalisation during the year which together with normal taxation of R7,6 million resulted in a total tax charge for the year of R24,6 et 14 million Attributable equity earnings were R47,3 million compared with restated 1976 earnings calculated the same basis of R28,2 million and the annual dividend was increased by 50 per cent to 60 cents a share : The Corporation has per cent interest in Johannesburg Consolidated Investment Company Limited JCI which holds wide- spread portfolio of mining and industrial investments and which derives the major portion of its revenue from gold and diamond interests and platinum through Rustenburg Platinum Holdings Limited which it administers The gold and uranium producer The Randfontein Estates Gold Mining Company Witwatersrand Limited operated very satisfactorily and increased net earnings 28 per cent to R48 million in the year ended December 31-1977 Good progress was made on its million expansion programme initiated in Directors review 9 . a . 1976. The Otjihase copper project undertaken by JCI came into production during a period of low base metal prices and has incurred substantial losses As a result it was announced on December 1977 that the mine had been placed on a maintenance basis Net earnings of JCI in financial year ended June 30 1977 increased by R800 000 to R27 million against an extraordinary charge of | i : = = Imports ou and Merchandsi ervsice es R12 million made in respect ofthe Otjihase investment The total dividend was maintained at 170 cents a share Net earnings for the months to December 1977 increased increased by 22 per cent to R15,8 million and unchanged interim dividend 40 cents a share was paid ae = : . The equity earnings of Charter Consolidated Limited the Corpora- tion's United Kingdom mining finance associate increased by 6,2 million to 25,4 million in the year to March 31 1978. Income from investments improved by 2,5 million and advantage was taken of improved stock market conditions to increase profits on realisation pr^fits of investments by 3,4 million to 5,8 million Trading of industrial subsidiaries declined marginally to 18,1 compared with 18,9 million for the previous year Reduced profits from Cape Industries Limited resulting dowandtowuntrurnn in the asbestos market * were partially offset by the inclusion of five months profits from the acquired subsidiary M.K. Refrigeration Limited while in addition the Elastic Rail Spike and groups more than than maintained their profits Extraordinary charges of 21,7 million BRST included provisions of 7,5 million and 6 million respectively , against Charter's investments in Cleveland Potash Limited and and a provision of 8,2 million to reflect the net effect of conversion of ee zB 31 currencies Charter's net asset value including investments at market BSS and directors valuations increased 14,1 million to 287,6 million : at March 1978 : at Capital lows Bas!; Long Short 25 As 1976 the major source of dividend income received in the by year to June 30 1977 Minerals and Resources Corporation Limited * Minorco a Bermuda investment company was its holding in Engelhard Minerals & Chemicals Corporation EMC Dividend income at 13,9 million was 26 per cent cent higher than in 1976 while after profits before extraordinary losses for the year ended June 1977 amounted to 12,7 million compared with 6,9 34,1 million the previous year Extraordinary losses amounted to 34,1 million which were covered by transfers from share premium and capital reserves of 26 million and 8,1 million respectively A reduced valuation of Minorco's Australian and other investments Outflow Sy sae Gold ant foreibnexchangereser valued an oz March SEPEES Gold = at R29.55 to end 1978 accounted for 8,1 million ofthe loss and USS26 million related to the writedown of Minorco's investment in Trend International Limited following material amendments to the production contract in which Trend International has a 27 per cent interest with Pertamina the Indonesian owned oil agency and production difficulties No income was received by Minorco from its 49.9 per cent interest in Zambia Copper Investments Limited ZCI ZCI's principal investments are in Nchanga Consolidated Copper Mines Limited NCCM Roan Consolidated Mines Limited RCM and BRST As result of the continuing depressed state of the copper market both NCCM and Directors review RCM are operating at a loss and the possibility of dividend payments being resumed the forseeable future appears remote During the year to June 30 1977 ZCI provided US million against its Gold and uranium investment in BRST Anglo American Corporation of Canada Limited Amcan reported Strong industrial demand continued consolidated earnings for the year ended December 31 1977 of CS3,9 million or CS0,39 a share and net earnings after an extraordinary gain of 23,8 million or CS2,39 a share The extraordinary gain arose from the realisation by an associated company Hudson Mining and Smelting Co. Limited of its potash assets in Saskatchewan The market price of gold during 1977 increased satisfactorily from a low in January 129,40 to a high in November of168,15 closing ^fin December at 164,95 and averaging 147,72 for the year an increase of 18,4 per cent Since then the trend has continued with gold reaching a high of 190 at the afternoon fix on March 8 1978 diversified i i Earnings benefited from the substantial reduction in provision against 9 In reviewing the gold market the past 15 months ought to be i investments lower exploration expenditures and the increased profits considered in two phases the first from January to September when of associated companies particularly Francana Oil & Gas Limited the price rose to and remained at the 140 150 level and the These improvements were partly offset by a decline in net interest second from October March when the price rose significantly In the received and in profits from securities trading Amcan's net asset first phase an equilibrium between industrial demand for gold and value at December 31 1977 including listed investments at market supply resulted in relative price stability with very little investment or value and unlisted investments at lower of cost or directors valuation speculation evident In the second the impact of growing American decreased slightly to 93,1 million interest in gold as an investment commodity particularly in the light Anglo American Corporation Rhodesia Limited Amrho holds the of the weakening dollar and the depressed state of Wall Street began Rhodesian interests of Anglo American Corporation Minorco and to take effect measure of interest which affected other world Charter in a portfolio Net earnings increased from markets was the volume the New York RS4,2 million to 4,5 million the financial year to June 1977 Commodity Exchange during November when options totalling 18,49 million ounces were Amrho has major investments in Wankie Colliery Rhodesian Nickel traded * . Technical under ttohree programme - Corporation Shangani Mining Corporation now managed by Anglo Since the end of the period review there have American Corporation Rhodesian Alloys and Hippo Valley Estates further developments which will influence the market The United in addition to interests in citrus agriculture forestry and timber States Treasury announced that it planned to resume selling at processing cement flour milling rolling stock hire property mer- rate of 300 000 ounces a month for at least month period in chant banking and investment finance * attempt to balance the substantial imports of gold into United Anglo American Corporation do Brasil Limitada Ambras holds a State The first of these auctions was held on May 23 when the gold 49 per cent interest Minera^^Moorro Velho S.A. which operates a on offer was readily absorbed into the market The results of the group of small gold mines near Belo Horizonte in Minas Gerais auction with an average price of 180,38 can be considered be very and operational improvements as well as higher gold prices satisfactory - the mine's profits in the year ended January 1978 and a Then India announced its plan to sell tons was paid Ambras is undertaking a substantial exploration gold apparently confiscated smugglers to its internal market over a month of for gold and base metals in various parts Brazil through period commencing May The sales to date appear to have had Unigeo Geologia e Minera^^oS.A. which is also continuing with very little impact as the Indian market is very restricted with gold feasibility studies of the Jacobina auriferous conglomerates in Bahia reaching prices that are no way related to those of the main 3 Although substantial tonnages of gold ore have been identified it is not centres gold yet possible to determine whether these low- to medium reserves can be viably mined at prospective gold prices and the extent of the higher grade tonnages indicated is currently being investigated The Corporation has a 36,7 per cent equity interest in Australian Anglo American Limited which is conducting an extensive exploration and prospecting programme for mineral deposits in Australia New Zealand and Fiji Australian Anglo American holds 80 per cent interest in a subsidiary Mulga Mines Proprietary Limited which until recently operated a small antimony mine at Nullagine in Western Australia The mine ceased operations early 1978 follow- : ing substantial losses that were incurred Further details ofthe principal finance and investment companies in which the Group holds significant interest are given on pages 79 to 83 Finally the International Monetary Fund IMF announced that it was reducing its monthly auctions by an amount of 55,000 ounces is generally from 525 000 to 470 000 ounces month It believed the reduction is to accommodate those developing countries under the terms of the IMF auctions can make competitive bids for gold Certain central banks can now deal bullion following the ratification of the revised IMF articles Two of these developments have brought more gold on to the market while another has lessened the amount available Provided the strong industrial demand of the first quarter of the year continues the market should have little difficulty in absorbing the new supply Supplies of gold to the market during 1977 appear have increased by approximately 10 per cent over the previous year to a total of about 1600 tons with South Africa the major supplier of 698,4 tons which Directors review comprised the industry's total production of 697 tons and 1,4 tons sold strong in the first quarter of 1978 when 1,669 million coins were sold out reserves South Africa's production 1,7 per cent lower than in being approximately half the total sales made during 1977. Apart from 1976 represented the lowest figure for 16 years although it is expected that production should increase again in 1978. Russia continues to be industrial demand and official coin sales there was also speculative buying particularly in the latter part of 1977 and early 1978 though the second major supplier followed by theIMF whose auctions there is always a possibility that this gold may return to the market contributed 188 tons or more than 10 per cent of the total supply and so be a disruptive element Considering the disruption these Sales caused when they first took Though it had been hoped that the second amendment to the IMF place in 1976 it is important to note that were the auctions to be be be discontinued now the market would seriously of physical e gold In fact current industrial demand for gold can no longer be met articles would ratified in 1977 this only took place early in April 1978. Consequently the South African Government revalued its gold holdings as at the end of March 1978 on April 11 to price of 163,27 out of western world production and a substantial proportion of being the average of the last 10 London gold fixes less 10 per cent and official and Russian sales are being used for industrial purposes It is will adjust the value of its reserves the end of each month on the this situation which gives the gold market its inherent strength and stability and results in rising gold price when industrial demandis supplemented by investment and speculative demand Industrial demand continued sustaining the growth shown during the second half of 1976. A contributor to this strong demand which the higher prices did not abate was the weakening dollar which made same basis This has two benefits for the mines the clause under the Mo^ambique Convention whereby the mines had to remit their employees deferred pay in gold to the Mo^ambiqueGovernment at the official price will fall away and the mines will now : receive a market price for all their gold immediately is sold to the Bank gold comparatively cheap manufacturers paying f^r example in Deutschemarks Swiss francs and the yen There has been one THE SOUTH AFRICAN GOLD MINING INDUSTRY significant shift in industrial demand in that sales the Far East have declined compared with 1976 but this has been more than compensated by increased demandin the United States Krugerrands also had good year and sales at 3.331 million were 10,8 cent ahead of 1976 though still below the 1975 record levels As a result of the increased interest in gold 26 per cent of South Africa's gold production was sold as Krugerrands in the last quarter compared with an average of per cent for the whole year Sales continued to be The industry produced 697 013 kilograms of gold in 1977 which was 099 kilograms or 1,7 cent less thanin 1976. Although average recovery grade improved fractionally from grams to 9,22 grams a ton production declined because tonnage milled decreased by 1,7 million tons to 74,5 million tons The average gold price received in 1977 increased from the 1976 price of 367 a kilogram to R4 084 kilogram equivalent to approximately 146 ounce 1976 5121 While Harmony Gold Mining Company Limited no longer publishes its gold working costs and profits separately in the rest of the industry unit costs increased on average by R4,29 or 21.9 per cent to R23,84 a ton milled Working profits however rose by R165,6 million or 18,6 per cent to RI 054,4 million while taxation and State's share of official sales Communist sales production Demand Net Netprivate purchases Official coins Fabrication profit profits for the year absorbed an estimated R495,7 million of this or 47 per cent compared with 44,3 cent in 1976 Capital expenditure on producing mines was R430,3 million as compared with R374,5 millionin 1976. Dividend declarations totalled 1976 R338,7 million R10,6 million more than for LABOUR satisfactory Labour relations were satisfactory during the month period Wage increases were less than inin previous years because of a national policy of restraint in an inflationary era The major issue among white employees concerned working hours Following negotiations for a day week the shift fortnight introduced in 1977 has been in operation for more than a year and its impact on production will be the subject a second report by the Franzsen Commission to be submitted to the Minister of Labour and of Mines Initial experience by the mines is that there have been production losses and cost increases The supply of black labour which increasingly is from sources closer to the mines was better in many previous years because of improved recruiting arrangements increases and continuing attention to living conditions The construction houses for more 17 Shaft sinking crew going on shift at the Free State Geduld No. 5 shafi where full sinking operations commenced at the end of February 1978 o "6 Directors review 5 senior black employees is now well under way this together with other developments in recruiting should result in time in a more stable labour force even though the majority remains migrants The majority of South Africans appears appreciate that changes are necessary in the entire field of industrial relations employment practices and labour utilisation Understandably these changes meet with resistance from some of our white employees and we have accordingly assured them of their job security and have embarked on intensive courses to encourage a changed attitude towards industrial relations and labour issues ainied at allowing mines to make more effective use of all workers In this connection the report of the Wiehahn Commission due in the second half of this year is of considerable importance o including the expansion of milling capacity Inflation has now boosted this estimate to R120 million and it will necessary to raise further funds probably during 1979 to complete the project Sinking operations were delayed about two months an accident in the shaft on October 7 During 1977 the amalgamation of the lease areas of Free State Geduld and Freddies was approved retrospectively to October 1976 In consideration for relinquishing its 50 per cent interest in Freddies Western Holdings Limited received 440 000 new shares in Free State THE GROUP'S MINES Gold production by the eight producing mines administered by Anglo American Corporation declined by 8 449 kilograms or 3,1 per cent to 262 408 kilograms Lower recovery grades were recorded at all mines RAC eee Total working revenue Total working costs except Free State Saaiplaas Gold Mining Company Limited and Welkom Gold Mining Company Limited which showed increases At Free State Geduld Mines Limited the grade mwaarsgisnuabl- stantially diluted by the lower grade of ore produced from Freddies Consolidated Mines Limited following the amalgamation oftheir two lease areas Although the Group's milled tonnage rose 5.7 per or 1416 000 tons 26 275 000 tons there was a further inflatiocnenotf 5 unit costs which rose R3,08 or 14.6 per cent to R24,25 ton milled > a ' spite of lower production working revenue increased by 17,4 per cent to R 071,2 million as result of the higher average price r^'ceived , I i of 082 a kilogram or about 146 an ounce 1976 121 The working profit of the Group's mines showed an improvement of R47,4 million per cent to R433,9 million Taxation and State's share White labour charges Electricity and wate ren t, of profits absorbed R160,2 million which was R2,2 million more than in 1976 and equivalent to 36,9 cent working profit Capital expenditure mining assets by these producing amounted to R174,5 compared with R173,4 million 1976. Of the 1977 ERY Stores vce of total R39,5 million 1976 R51,6 million was incurred respect the Joint Metallurgical Scheme JMS undertaken by the Group's s Orange Free State mines Dividends paid totalled R112,9 million compared with R118,6 million 1976 : Group ore reserves are currently estimated at 54,7 million tons at a of R3 pay limit based on a gold price 300 kilogram 7% Commissioning of the JMS to recover uranium sulphuric acid and gold from current gold plant tailings deposited slimes began in March 1977. Several technical problems were encountered causing 1977 production to be lower than anticipated and making it necessary 10. buy material from a Group company to meet commitments for uranium sales in 1978. Uranium production the end of September was 207 tons and in the December quarter 106 tons If the g encouraging improvements in the metallurgical performance continue as planned the JMS will achieve full potential before the end of 1978 G At Free State Saaiplaas the major development concerns the new No. 3 shaft which was estimated in 1974 to cost RS1 million f . Ray Se a \ Directors review 2 WA SS t 1 Geduld giving an effective 4,2 per cent beneficial interest in the merged mining operation scale sinking has commenced Free State Geduld's No. 5 shaft where the headgear is complete. At Western the year Holdings mining operations continued normally during At President Steyn Gold Mining Company Limited underground fires in August 1977 and a slow production build up at the No. 4 shafi caused both grade and tonnage milled to be lower than forecast for the year ended September 30 1977. Results for the year include the Video Mining Company Limited lease area where development only was undertaken until October 1977 when stoping operations started President Steyn will continue to reflect consolidated results of the two companies in its published accounts 7 At President Brand Gold Mining Company Limited total capital expenditure was R35.7 million This included expenditure of R29,7 million on account of the JMS the after cost of which was financed by loans Further expenditure of R28 million is expected during 1978 including R16,5 million for the JMS Improved results for 1977 by Welkom Gold Mining Company Limited were largely the result of the new mining policy of extracting pillars in worked areas where grades are generally better than those being exposed in newly developed areas By the end of 1977 the material shati at Elandsrand Gold Mining Company Limited had been sunk to 1933 metres while the ventilation shaft reached its final depth of 195. metres on January 5 this year In addition during 1977 079 metres of station development and 162 metres of orepass raiseboring were completed at the materials shaft complex and 1610 metres of station development completed at the ventilation shaft Net expenditure on mining assets during the year amounted to R45,4 million and is estimated af R78 million in the current year The mine is well ahead of schedule and an underwritten rights offer to members of Elandsrand was madein June 1978 to raise approximately R77 million to finance the estimated capital expenditure required bringbring the mine into productionin 1979 to 4 At Vaal Reefs Exploration and Mining Company Limited it was responsiblity decided that operating management should have greater responsibility at this very large complex where expenditure on working amounts to about R200 million a year and senior Corporation officials were seconded were the company in operating management positions be further changes during 1978 to ensure more effective use will of the company's human resources and to provide greater decision- and making mine level The North South mining divisions have been ahalgamated into one and Nos and 2 shafts South are now identified Nos 8 and 9 shafts respectively Faulting and uncertain values continued in the South area causing additional lower grade ore be mined the North lease to fill milling capacity Extensions the present East and West uranium plants and construction of the new South ^...raniumplant have begun Commissioning dates have been advanced considerably to take advantage of the continuing strength of the uranium market and it is now planned expand treatment plant capacity to 720 000 tons month in the second half 1979 a year sooner than scheduled The collar No. 9 shaft is complete and the concrete headgear constructed to its final height with sinking now planned to start September 1978. The shaft is expected De commissioned in 1983. Building the new hostel to accommodate 6,000 6,000 men is continuing At Western Deep Levels Limitedan underground fire broke out in June 1977 one of the highest grade areas of the mine making it necessary to expand production from lower grade sections Work is continuing on the tertiary vertical shaft systems at both Nos 2 and 3 shafts to allow mining operations below the 100 level to expand However the high stress associated with such entailing costly a support of haulages is restricting the rate advance The new hostel complex is now occupied and older hostels are being upgraded Construction has started the new village for senior black married employeesand their families which is to be shared with Elandsrand Gold Mining Company East Rand Gold and Uranium Company Limited Ergo produced its the first uranium on February 25 1978 only two years decis dei cio sin on to ' go ahead with the project to recover gold and uranium and to produce sulphuric acid from old slimes dams The million project is shortly expected to achieveits planned reclamation rate of 1,5 million tons of slimes a month Initially annual production should be about ' a. , Dire Gots fe cew Directors review Construction of the crushing plant at De Bers Koingnaas mine the Namaqualand coast The mine comes into production during July 1978 and will build up to a rate of 500,000 carats a year consisting mainly of small high qualitygems 7000 7000 kilograms of gold 200 tons of uranium and 000 tons of negotiations untalks with Government on various aspects aspects sulphuric acid of which70.000 tons will required for Ergo's own project are concluded July treatment processes In last year Ergo made an offer of 16 million \ss ' shares R3,50 R3,50 a share of which 250 shares were firm } and the feasibility study has been reviewed oa a subscriptions by certain companies and institutions When employees the offerclosed on July 29 applications totalling R286 million had The reportable accident rate per thousand per annum in service on the mines of the Group fell by 1,58 1,58from 45,05 to 43,47 been received a record for a South African share issue and the 3 750 000 shares offered the public were eighteen half times subscribed Since the inception of the company the net proceeds avail- while thefatality rate remained virtually static 1,29 The Group Chairman'sChairman's Safety Shield was won won by Free State Geduld for the second time while the Chamber of Mines Millionaire Shield was won by Vaal able from the issue of equity capital amounted to R114,8 million with Reefs North for the fifth time This major award which is presented to the balance of funds for Ergo's capital expenditure being provided by mine on completing a million consecutive fatality was revolving credit facilities and short borrowings In November also won by Freddies for the second time shortly before its Ergo received the Rand Daily Mail's Business Achievement Award for amalgamation with Free State Geduld . . Pe 1977 in recognition of its pioneering technical accomplishments and its contribution to the development of the South African economy Company The South African Land & Exploration Limited which terminated underground mining at the end of 1976 continued to of recover gold from waste rock dumps in the East Rand area and the . intention is to do so for long as it is profitable Meanwhile initial The detailed operating results of gold American Corporation and those in which aa interest are given on pages 84 to minesininistered the Group exploratory- results have been obtained from the first of the two boreholes south and south of the workings The reef was intersected at depth of 3065 metres but the crades have been further _ disappointing Drilling is continuing in bolles bolles expected during 1978 will determine whether to embark on further holes a, East Daggafomein Mines Limited terminated underground mining in November 1976 and arrangements were subsequently made to sell |: its gold treatment plant and all other plant equipment and salvage- able items Substantial income was received 3 from certain royalty arrangements entered into 1977 as well as from the disposal of sale- such now ableassets However similar results are not expected to recur as the bulk of assets have now been realised & URANIUM G During 1977 the uranium price remained firm at 1976 levels Although the world recession led to a downward revision of proposed _, construction programmes nuclear power stations the uncertainty a of uraniumsupplies from Canada and Australia lent support to the stringent ': market as did the United States insistence that more conditions of sale should apply to uranium Group gold mines have been well placed to take advantage of the strong uranium market with production rising by 32.9 per cent to 1533 tons the increase being largely from the JMS At Vaal Reefs the increase in treatment capacity from 335.000 335.000 tons 720 000 tons a month is now expected to come into operation in the second of & 1979. detailed feasibility study and the testwork for The during Afrikander Lease Limited project were completed is however concern over the continuing inflation 1977. There of capital and Diamonds bs ae Sales new record Sales of rough gem and industrial diamonds by the Central Selling Organisation CSO during 1977 reached new record of US 073 million or KT803 million an increase of cent compared with the previous year Prices raised by an overall 8,75 per cent 1976 were further increased by 15 per cent March 1977 by 17 per cent in December The market which had been characterised during most of 1976 by demand particularly for the smaller sizes and the cheaper qualities of large diamonds strengthened further over the course of the year By the end of 1977 an unprecedented demand had developed for all qualities of goods despite the price increases the sale to the cutting centres of more carats than ever before Primarily this was because of excellent trading conditions for diamond jewellery at the retail level particularly in the United States seen partly in response to the CSO's world advertising efforts However during the latter part of the year a measure speculative trading in the cutting centres and of general investment interest in diamonds as a store of value also began to influence overall demand In the first months of 1978 when the effect the Decemberincrease could not yet have filtered through to the retail stores this resultedin premiums wellin excess of the CSO prices being paid for rough diamonds in the secondary markets At the same time it became apparent that the bank credit which was being used finance stocks in the cutting centres some of it based ruling premium prices was reaching proportions which in the event of any market downturn could cause severe working costs This could affect the viability of the mine which unlike liquidity problems To counteract this situation and to enable the other South African mines would not produce uranium as a byproduct of gold As a result it has been decided to delay a decision on <. the establishment of a mine and temporarily to suspend - sales producers to benefit from the premiums being paid the CSOin March this year introduced a variable surcharge surchargteo the normal list prices of diamonds it offers sale The surcharge at rate to be determined at 22 y : 4 wd a EF of ie a 3 y,, serescia Directors review De Beers mine Dutoitspan mine Bultfontein mine Wesselton mine " Finsch mine Kimberley Division total Namaqualand mines Premier mine Premier mine .... Consolidated Diamond Diamond Letseng mine: Metric tons treated 1977 1976 Carats recovered 1977 1936 725 497 792 806 1 042 240 1948 1948 348 3 639 640 3712694 3712694 ] 861 225 4 066 711 7.074.403 7.074.4037.074.403 14 899 997 680 000 800 634 1068 1068 671 717 109 1948 268 454 315 6 113 963 143 329 729 528 817 425 799 409 789 11 645 948 3 857 654 574 895 12 879 152 240 1 162 752 4 2010307 2001 217 * 22 688 121 522 153 399 216 560 261 2 202 778 354 044 3 608 145 026 905 833 278 1693 994 _ Carats per 100 metric tons 1977 1976 15,71 14,15 31,64 27,14 66,65 11,04 3,34 15,18 14,35 30,14 28,76 63,76 9,68 os 26,62 27,88 13,15 _ 3 565 1.087 310 211 428 985 _ 38 386 634 010 345 981 $ 808 195 2 383.599 a4 545 921 Cost per metric ton 1977 1976 R R 4,68 3,84 4.53 . 3.67 4,78 . 3,45 4,34 3,73 2,85 2,16 2,92 2,63 5.27 . 3,36 3,53 2,36 4,46 a Pula 2.48 _ the time of each sale will continue to be applied until reasonable relationship has been restored between the market price of rough diamonds and the retail prices of polished diamonds Sales of industrial diamonds both natural and synthetic also established a record 1977. High demand levels continued throughout the year particularly for drilling diamonds and the coarser natural and synthetic grits favourable The outlook for the current year remains The consolidated net profit after attributable to De Beers Consolidated Mines Limited more than doubled from R309 million in 1976 to R623 million equivalent to 172.7 cents deferred share 1976 85,2 cents after allowing for dividends on the preference capital The net diamond account rose by R300 million R751 million because of the higher volume of sales and the price increases in September 1976 March 1977 and to a lesser extent December 1977. This improvement was achieved despiteTrading the fact that results of The Diamond Purchasing and Trading Company Proprietary Limited which ceased to be subsidiary during the year were no longer consolidated Income from other sources notably unlisted investments and interest received rose by R84 million to R192 millioannd expenditure rose by R16 million to R55 million Consolidated profit before tax at R888 million was R368 million higher than in 1976. Tax and the State's share profits which had risen by million in 1976 rose further during 1977 from R183 million to R255 million A record level of dividends was paid on the De Beers deferred shares for the year amounting to 52,5 cents a share 1976 35 cents and total of R312 million 1976 R164 million was transferred to reserves The value at cost diamond stocks decreased by R7 million R221 million while net current assets rose R159 million to R502 million Production by the mines of the De Beers group in South Africa South West Namibia Botswana and Lesotho amounted to 808 195 carats in 1977 compared with 545.921 carats 1976 Contributions to this increase amounting to about 12 per cent were made by all the mines of the group except Orapa where the recovery grade was marginally lower than 1976. new Letlhakane which is also owned by De Beers Botswana Mining Company Proprietary Limited Debswana was commissioned at the end of 1976 and produced 345 981 carats during the year The Letseng Terai in Lesotho also reached full production during the year and produced 22 688 carats Production from the Kimberley Division mines rose by nine percent percent from Namaqualand by 13 per cent from Consolidated . the Premier mine by 10 per cent and from Mines CDM by 18 per cent Diamond Major capital expenditure programmes were in progress within the De Beers group which with others recently initiated will bring about a substantial increase in productive capacity Construction work at the Koingnaas mine in Namaqualand is nearing completion and production at the rate of approximately 500,000 carats a year is expected to start in the middle of 1978. The small Langhoogte mine also in Namaqualand will start producing at the rate of some 60 000 24 carats a year at about thesame time Design Design work has commenced for a new plant at Tweepad just north of Dreyers Pan so that productio i levels can be maintained when towards the end of 1980 it becomesbecomes necessary to treat the lower grade ore in this area At Finsch mine north of Kimberley major modifications to the treatment plant are being planned which will increase diamond output within nearly a abwouot years from the present level of 2,5 million carats year to 3,5 million carats Government approval has been received for new lease arrangements for the Premier mine near Pretoria enabling expenditure on capital works to be financed by De Beers At Premier with workis proceeding with the developmentdevelopment of mining operations below thegabbro sill Production from below the sill is due to start in 1979 andwill considerably extend life of the mineWork is proceeding a scheme to treat certain of the older dumps in and around Kimberley the effect of which will be to extend the life of the Kimberley operations to approximately 20 years Deliveries of dump material to the central treatment plant will start early in 1979. In expected of Orapa Botswana work in hand on the expansion is to increase the rate of production of that mine from 2,35 million to approximately 4.5 million carats by the end of 1978 while production from Letlhakane is expected to increase by about 25 per cent when mining moves from the surrounding gravels to the Kimberlite pipe towards the end of 1979. Agreement has been reached with the development Government of Botswana for the of an important new mine at Jwaneng in the south of the country where a major kimberlite pipe overlain by Kalahari sediments to a depth of 30 50 metres was discovered by De Beers1973. The mine to be developed and operated by Debswana in which the Government has a 50 per cent interest is dueto be brought into commercial productionin a 1982 an initial rate of approximately 3,5 million carats year rising million carats in the 1980s ~ In the sphere of industrial relations important progress was made towards the of elimination all forms of racial discrimination within the control of the De Beers group A comprehensive programme of job evaluation on the mines in South Africa and South West Namibia has resultedin the introduction of an integrated wage scale for employees of allraces In the Kimberley Division the employment of migrants is now being limited to those to whom an obligation exists to provide continuing employment Agreement has been reached with the authorities for the establishment of financially assisted home ownership schemes for black employeesin Kimberley and at Koffiefontein At CDM the families of the first Ovambo married employees to be housed at Oranjemund arrived during the year Selection and training facilities throughout the group's mines a were expanded and improved Following the introduction of five- day working week for the mining sector in the Kimberley Division in November 1976 these arrangements were extended to artisans on the Kimberley mines in December 1977 and were introduced for the mining sector at Premier in February 1978 In anticipation of constitutional and political changesinSouth West Namibia the head office of CDM was moved from Kimberley to Windhoek - The scope of work of the De Beers Diamond Research Laboratory expanded significantly during the year Attention continued to be devoted to bettering the efficiencies of mine recovery plants and to developing improved recovery methods and in March a new separation plant was commissioned at Finsch mine for the handling of small sizes concentrates In response the trend towards . greater- use of diamonds in industrial processes a variety of new synthetic products was developed SDA100S for use in specialised sawing and drilling applications has been added to the range of synthetic diamonds produced by De Beers application testing of another new line of products SYNDITE cutting tools is being pursued The production of CDA an elongated diamond grit particle for use in resin bond grinding wheels began at Springsthe Transvaal and an equally novel resin bond grit for dry grinding of carbide promise called CDA also shows considerable commercial Further details of companies in the De Beers group are given on pages 88 % and r Directors review The first of two 3.00 3.000 Bucyrus Erie draglines at Ameoal's Kriel min^' in the eastern Transvaal When fully operational the draglines will move 23 million cubic metres of overburden annually } / Coal Exports build up through Richards Bay The South African coal mining industry recorded significant growth in 1977 despite worsening economic conditions worldwide However while the world market for steam coa continues to show signs of underlying firmness there has been a weakening in overseas demand for metallurgical coal and in the domestic market for bituminous coal The build of exports through Richards Bay has progressed satisfactorily reaching the planned annual rate for Phase 1 of 12 million tons in the last quarter of 1977. The value of South Africa's coal exports 1977 amounted to R248,5 million placing coal third in export turnover after gold and diamonds The coal terminal is to expected to operate at capacity during 1978 and Phase 2 of the export progranine will start late in 1978 when the terminal's capacity will be progressively increased by eight million tons to 20 million tons a year Furthermore the coal industry Government the Railways and the Richards Bay Coal Terminal Company Proprietary Limited are now examining the feasibilitya Phase 3 programme of exports involving an estimated additional 20 million tons year The industry has been advised that the first priority Phase would be the fulfilment of outstanding export authorities granted to Phase 2 exporters Prospectively these developments could increase the already valuable contribution that coal exports are making to the country's balance of payments to approximately R1 000 million by the mid 1980s Theadditional capacity necessary to meet domestic demand was provided by the industry following the significant increase in the domestic coal price in 1976 However the current reduced demand caused by mild winter full stockpiles and depressed deprsed economy has resulted in some surplus capacity Although this is disappointing the industry is now well placed to meet increased demand and avoid the periodic shortages that were experienced : before : - Total sales by the South African industry in 1977 rose by 10.4 per cent from 77 to 85 million tons while sales by adinistered collieries increased by 10,5 per cent 28,4 million tons equival^ntto : 33 per cent ofthe total Total operating profits before tax of Group collieries increased significantly to R73,7 million from R49,1 million in 1976 owing mainly to the domestic price increase and export earnings Working cost increases of 19.5 per cent while lower than in 1976 were nevertheless higher than budgeted and continuing attention is being devoted to containing them The Group's major coal company Anglo American Coal Corpora- tion Limited Amcoal again made considerable progress in 1977 with turnover up 31 per cent to R259 million and group earnings up 68 per cent to R47 million Dividends were increased by 50 per cent to 60 cents a share and even so were constrained by the substantial remaining capital expenditure programme of R181 million in present money terms The development of Amcoal's new Kleinkopje mine is proceeding well with the first coal expected to be produced as planned at the end of 1978 and the total cost remaining within the original estimate of 109 million in 1976 money When the mine is in full production in 1983 it will provide the two million tons a year of exports for which Amcoal has been granted firm Government authority under the 2 Phase export programme In total Amcoal was granted provisional permission to export five million a tons year for 20 years Amcoal will thus be entitled to export three million tons a year in the proposed Phase 3 programme and is accordingly investigating the best source from which to producthee additional coal The supply of coal by Group collieries to the Electricity Supply Commission Escom in 1977 increased by 1,4 million tons mainly because of the build at Kriel which supplies the Kriel power station The underground mine produced 2.7 million in 1977 and will build up to the planned annual rate of four million tons during 1978. The stream diversion for the opencast mine was successfully commissioned early in 1978 and coaling commenced in the second quarter The power station will ultimately.consume 8.5 million tons of coal a year from the underground and opencast mines 26 Directors review The vertical shaft and access ramp left at the Middelplaats Manganese mine in the Sishen area of the northern Cape Initial deliveries from this R47 million development are due by the end of March 1979 most of which will be for export Arnot Colliery the Group's biggest supplier to Escom has had to reduce its open^as~-mine output because of full stockpiles and lower than expected consumption Meanwhile significant progress has been Other mining made with surface restoration the Arnot opencast mine The two Transvaal export collieries Bank and Landau operated Copper price prospects not encouraging well through 1977 both achieving improved washing plant yields of low and power station coals Together they supplied 4.4 million tons of the Transvaal Coal Owners Association exports of8.6 million tons in 1977 = reported Prices in the world copper market declined steadily through 1977 and in the first quarter of 1978 reflecting the absence of any significant recovery in the economies of major trading nations and the existence of record surplus stocks At the beginning of 1977 the London Metal In Natal Vryheid Coronation Limited reported marginally lower earnings in 1977 as a result of difficult trading conditions in the coke market Conversely the Natal Anthracite Colliery Limited group reported substantially improved earnings following successful export sales and profitable dump recovery operations Increased mining difficulties in remnant reserve areas and problems Exchange LME copper price was 795 a ton or US cents a pound improvingbriefly in March 1977 to over 900 mainly because of an expected year strike over wage negotiations in the American copper mining Industry Settlement of the dispute was reached without any significant stoppages and prices on the LME and in the United States returned to their downward trend associated with hand mining meant another difficult year for the Group collieries supplying blend coking coal to The South African Iron and Steel Industrial Corporation Limited Iscor The possibility of mechanising certain of these operations is being discussed with Iscor but the short lives remaining may make mechanisation uneconomical The Group is in an extremely strong position as to coal reserves for it already controls more than six billion mine tons of coal By the end of 1977 the LME price stood at 666 while LME stocks increased during the 12 months from 603 000 tons 10 641 000 tons and total western world stocks increased to more than two million tons In the first quarter of 1978 the price declined further reaching a low point of 611 in February and at March 31 the price had risen again to a 696 a ton equivalent to 60 cents pound LME stocks at that date . totalled 575.000 tons reserves and is making satisfactory progress in its prospecting Prospects of an improvement in the coppercoppermarket during the next programme which has as its main objective over the next four years 12 months are not encouraging There are no indications of a worth- the acquisition and consolidation of coal blocks in the Transvaal totalling a further three billion tons Q GrGrooupup In the short term the spread of coal interests in the will enable substantial profits to be earned notwithstanding difficult while increase in world consumption so any alleviation must come from reduction of supply Although countries affiliated to the International Council of Copper Exporting Countries Cipec failed to agree in December 1977 on round cutbacks in production Zambia trading conditions In the longer term Group participation the Za^flre and Peru in February 1978 jointly announced proposals to ~ export trade is expected to grow and there are good prospects for reduce by 15 per cent their supply of copper as soon as possible increasing sales to the domestic market particularly of power station coal Shortly thereafter Zambia announced a 15 per cent force majeure cutback on contracted deliveries of copper until December 1978. It In Rhodesia coal sales Wankie Colliery Company Limited for the will however take some time before the effects of these decisions can year ended August 1977 fell by 11,9 per cent to 2 197 000 tons marginally while coke sales at 194 000 tons were less than in the previous year Net earnings declined by 147 000 to RS2,6 milliionn and the dividend was maintained at 7,5 cents Although sales the circumstances trading results were satisfactory the lower be gauged including the disruptions of supplies of copper i resulting from the invasion in May 1978 of the Shaba province of Za^flreby anti- Government forces The main difficulties surrounding the Group's Zambian investments remain unchanged The effects of lower prices and increased costs meant that profits on sales to Rhodesian customers fell short of the level provided for the agreement with the Government for the have led to position where the two mining companies Nchanga Consolidated Copper Mines Limited NCCM and Roan Consolidated supply pricing of coal and coke In terms of the agreement the shortfall on profits amounting to RS2,1 million would be recovered Mines Limited RCM after a brief return to profitability in 1976/77 are incurring substantial losses while operations have been hindered during the current year if a price increase of more than cent were to be implemented The agreement however has been tem porarily suspended and the company has agreed to a 10 per cent increase in the price of all its products by severe shortages of skilled staff and to a lesser extent by shortages of components through lack of foreign exchange With the continued closure of the Benguela railway outlet to Lobito Zambia's mining industry has had to rely heavily on the congested port of Dar Further detailosf coal mines administered within the Group and those in which the Group holds a significant interest are given on pages 89 and 90 Salaam leading at times to a build of copper stocks awaiting export Liquidity is a serious problem and the companies are receiving substantial temporary loans from the Bank of Zambia NCCM produced compared with 421 250 509 tons against 407 tons of finished copper during 226 tons the previous year RCM's output 289 960 tons in 1976 1977 was Directors review In South Africa Rustenburg Platinum Holdings Limited which holds as its principal asset the entire equity of Rustenburg Platinum Mines Limited reported consolidated profits after tax of R4,6 million for the year ended August 31 1977. While an interim dividend of 2,5 cents a share was declared the reduced earnings in 1977 did not allow profits a final dividend The 1977 profits are not comparable with the of R44,1 million reported by the company in 1976 as the basis of accounting was changed in two respects both of which had the effect of reducing profits Rustenburg group companies achieved slightly higher in the year to August 1977 than in the previous financial year despite difficult market conditions with the price of platinum fluctuating between 160 an ounce in September 1976 and S152 an ounce in August 1977. These unduly low prices combined with the effects of inflation on capital and working costs adversely affected the company's financial position In addition market conditions dictated a cut in production of between 10 and 20 per cent as from November 1 1977. The capital expenditure programme for the current financial year was also reduced by R7,5 million iQ R15 million The cutback in production coincided with a in reduction supplies of platinum and palladium from Russia as well as considerable speculative activity and evidence of restocking by Several users The free market price rose from about 170 an ounce in November 1977 to 220 by the end of January 1978 and to peak in May of 252 Rustenburg was therefore able to raise its own price for platinum progressively from 205 an ounce on January 25 to 240 on June 8. Its palladium price was raised to 70 ounce Negotiations are taking place to redress the losses that the company is incurring on platinum to the automotive industry and steps have been initiated to bring the level of production closer to the current level of sales Rustenburg's net earnings for the six months to February 28 1978 fell by R1,4 million to R400 000 and no interim dividend was , declared , : Hudson Bay Mining and Smelting Co. Limited Hudbay reported consolidated earnings the year ended December 31-1977 of CS4,4 million or CS0,44 a share excluding an extraordinary gain of CS52,6 million or CS5,20 a share arising from the sale of Hudbay's potash assets in Saskatchewan The corresponding figures for 1976 were earnings of CS2,8 million or CS0,28 a share before extraordinary charges of CS11 million or 1,10 a share The consolidated results _ include Hudbay's share of earnings and losses which are accounted for on an equity basis of effectively controlled companies The results also include 2,3 million representing unrealised exchange gains on the translation into Canadian dollars of United States subsidiaries accounts Hudbay passed its third and fourth quarterly dividend payments and the total distribution for 1977 amounted to 60 cents a share compared with 80 cents in 1976. The improvement 1977 earnings before extraordinary items stemmed largely from the better performances of Hudbay's petroleum subsidiaries Francana Oil & Gas Limited and Canadian Merrill Limited which benefited from increased production and higher product prices This was offset to some extent by the continuing weakness in metal and fertilizer markets which together with increased costs adversely affected Hudbay's earnings Contributions to pre operating profit for the year were 3,1 per cent from base metals 33,2 per cent from fertilizers and chemicals 62,4 per cent from oil and gas and 1,3 per cent from industry Two new mines were brought into production at the company's base metal operation in the Flin Snow Lake area in northern Manitoba and work was started on new 26 million concentrator near Snow Lake Hudbay's oil and gas investments represented by its 61,9 per cent interest in Canadian Merrill and its 54,9 per cent interest in Francana which in turn owns 56,8 per cent of Trend International Limited all reported higher net earnings flowing from higher product prices increased production and improved access to markets Canadian Merrill's net earnings for the year to June 1977 were 3,6 million er 1.72 a share compared with CS2 million or CS0,99 a share in 1976 sand the six months to December 1977 net earnings at CS1,7 million or CS0,70 a share were marginally higher than in the corresponding period in 1973 before an extraordinary gain of CS349 000 in 1976 Francana consolidated net earnings in 1977 of 9,9 million or CS1,27 share compared with a loss including an extraordinary item of CS18,1 million or CS2,33 a share in 1976. All three companies continued their exploration and development programmes in 1977 with Francana making a significant heavy and gas discovery in Saskatchewan and Canadian Merrill expanding materially its gas reserves in Colorado 7 Terra Chemicals International Inc. in which Hudbay has a 50,5 per cent interest carned US million or 1,27 a share compared with 1976 earnings of 12 million or 2,03 a share This decline was caused mainly by weak fertilizer prices in the United States together with the rising price of natural gas the principal raw material the production of Terra's nitrogen products The new ammonia plan~- Oklahoma in which Terra has a 25 per cent interest is now in full a production and a nearby ^"pgradingplant in which Terra has 65 per cent interest is in the final stages of construction and is expected to begin production early in 1978. Terra's planned expansion the south and south west progressed progressed further through the acquisition of most of the assets of Riverside Chemical Company which has blending and distribution centres located mainly in the southern states of the USA Inspiration Consolidated Copper Company recorded a loss for the year ended December 31 1977 of 11,1 million compared with a profit of 126 000 for 1976. The main factors responsible for this loss were weak copper prices low demand a strike during July and August Dividends for the year were reduced by 30 cents to 20 cents a share Deliveries of copper were marginally higher than the previous year at 90,9 million pounds but this was more offset by the fall in the average price from 69.48 cents a pound in 1976 to 66,84 cents in 1977 when the entire US copper industry experienced one of its worst years since the early 1930s with demand for domestic copper dropping substantially lower copper being imported The competitive position of US producers further weakened by costly wage settlements in 1977 The equity earnings of The Messina Transvaal Development Company Limited fell sharply from R13,9 million in the previous year 30 Directors review SE ag teh ae ed rl ent ON ene gncie et t ; : 4 we! ne ee ee Oe eat nota to R6,2 million for the year ended September 1977. This decrease decrease was largely the result of low world copper prices and prevailing economic conditions in South Africa which adversely affected certain of the Messina group's industrial subsidiaries The financial performance of the copper mine at SelebiPhikwe in Botswana operated by BCL Limited in which the Group Group has a significant interest through Botswana RST Limited BRST was seriously affected by the decline the price of nickel and an operating loss of P3.88 million was incurred during 1977. The net loss attributable to BRST shareholders amounted to P38.54 million after charging interest payable of P27,8 million and taking into account exchange gains other expenditure and extraordinary items Production at SelebiPhikwe fell slightly from 32 506 tons in 1976 to 772 tons 1977 mainly because the smelter the company's plant was closed during the first half the year for routine maintenance purposes A record level of 307 tons was however achieved for the following sixmonth period Production during 1978 is expected to continue at the higher level although inflationary pressures are likely to increase operating costs Furthermore nickel and copper prices are not expected to increase significantly during the current year The financial and sales restructuring of BCL was concluded on March 16 1978 and is dealt with in the Finance and Investment section of this report The consolidated Limited for the year net profit of Rhodesian ended March 31 1978 was Nickel RS2,3 : Corporation million com pared with 3,6 million previous year The dividend was passed because of the company's heavy loan indebtedness and the present depressed state of the world nickel market A final dividend of three cents a share was declared absorbing RS720 000. Dividends for the previous year amounted to seven cents a share and absorbed RS1,7 million The complex geology of the deposit impeded development of the Cleveland Potash Limited mine in the United Kingdom which is jointly owned by Charter Consolidated Limited and its associates and Imperial Chemical Industries Limited The increased use ofcontinuous mining machinery the mine has resulted in improvements in roof conditions and the rate of advance and remaining technical difficulties are associated mainly with a varying potash seam and near- seam strata However the use of long horizontal drilling which probes ahead of current workings has greatly augmented knowledge about the nature and extent of the ore reserves and has allowed more effective planning of future mining operations Production has recently reached a level of around 30 000 tons ofproduct a month Charter has a 10,8 per cent interest and Anglo American Corporation a 3,4 per cent interest in Tara Exploration and Development Company Limited which through subsidiary Mines operates a zine mine at Navan in the Republic of Ireland capital cost of the mine was US million 81,2 million and it has a designed capacity to produce 500 000 short tons of lead and zinc concentrates a year from 2,5 million of ore Production started in June 1977 and although labour unrest delayed the mine development programme in 1977 production in 1978 is proceeding satisfactorily However Tara will be adversely affected by the prevailing low demand for and market pricoef zinc ~ Beral Tin and Wolfram Limited reported a record tax profit of 4,5 million for 1977 compared with 2,6 million in the previous the year This increase was mainly result of firm wolfram prices which more than offset a decline in volume of concentrate produced and sold by the Portuguese operating company Swaziland Iron Ore Development Company Limited continued to supply medium ore to certain Japanese steel mills The company Directors review A Boart dril ingdrilling rig on top of slimes dam provides an unusual sight at the President Brand gold mine in the Orange Free State Although prospecting the early 1960s indicated that the reef in this area the western corner the mine's lease was of marginalinterest only the increased price ofgold has prompted further investigation was unable to meet its term contract for the supply of two million dry long tons annually as continuing difficulty was encountered with railway and loading facilities the port of Maputo However the company operated profitably and maintained dividend payments Although the ore reserve was depleted and mining operations ceased in December 1977 treatment of the large stockpile accumulated as a result of poor railway and port services continues Taking the current rate of despatches into account all operations at the mine are expected to cease during 1980 Construction of the Middelplaats Manganese Limited mine in the western Cape is progressing satisfactorily and production is expected to commence in incline service service ramp has 1979 However construction fallen behind schedule although of the it has reached a point more than 450 metres from the portal The plant construction contract has been awarded housing and offices are being constructed and site establishment has started A. nine kilometre railway line to carry 100 truck trains is being constructed from the mine to Mamathwane Station Zinchem and Industrial Mineral Resources Proprietary Limited Zimro leader in the industrial base mineral and zinc chemical fields reported 28,2 per cent increase in net earnings for the year ended December 31 1977. As previously reported the problems experienced the Hudson Mining Company Proprietary andalusite mine have been overcome andthat has * Limited company has contributed substantially to Zimro's profit growth Depressed trading ~ conditions in the European foundry industry have adversely affected the performance of G. W. Industrial Chemical Supplies Proprietary Limited This company which markets chrome sands from its operation in Vlissingen Holland has been affected by interruptions in severe competition and the threat of product substitution During the year & W. Base and Industrial Minerals Proprietary Limited acquired the total issued share capital of Foundres Proprietary Limited a company manufacturing and selling foundry requisites complementary the company's present product . range Further details of mines administered within the Anglo American Corporation Group and those in which the Group holds a significant interest are given on pages 90 93 Industry commerce Cost pressure hardly reduced The industrial commercial and construction sectors of the economy were more seriously affected than others by the poor economic circumstances of 1977. Policy measures designed to curb domestic demand had marked effect on private consumption expenditure with sales volumes declining in all categories including foodstuffs Durable consumer goods were affected to an even greater extent with car sales in particular falling below the depressed levels of the previous year because industrialists Investment activity declined drastically in exces virtually all areas found themselves with growing excess capacity and because public sector investment spending was reduced sharply - partly to conform with Government policy and partly as a result of a number of major projects having reached completion In these circumstances it was hardly surprising that manufacturing output three should reflect the largest decline experienced in more than decades However some relief to this generally environment was provided by an exceptional agricultural season reasonably favourable results in the mining sector and a to lesser extent continued spending on some public sector projects Certain industries - notably those producing chemicals and various metal products - and to some extent the demand for contract work benefited from these developments In some instances exports aiso maintained volumes particularly in sales of processed semi- processed iron and steel Elsewhere however output more accurately reflected the drop domestic demand . with manufacturers of electrical machinery and appliances transport equipment and timber being notewortheyxamples y Despite slack demand and a slower rate of increase in average wages cost pressures were hardly reduced mainly because of continued increases in administered prices This was clearly reflected in depressed average profit levels and the growing number of unem- ployed a problem of extremely serious proportions The urgent need for growth to combat the problem of unemployment in particular has prompted a gradual but only moderate relaxation of policy measures In the absence of further similar steps which hinge on balance of payments developments only a marginal improvement in industrial and commercial activity can be expected The investments the Corporation and its associated finance companies in industry and commerce cover a widerange of activities including iron steel alloys chemicals and explosives civil engineering and construction drilling tools refractory and other structural clay products textiles plastics paperboard timber including wattle extract for the leather industry agricultural products and foodstuffs industrial equipment motor vehicles and components rail loco- computer motives and coaches shipping forwardingforwarding and clearing and services The Group has wide spread of industrial interests in South Africa both directly and through its investments in Amic De Beers Industrial Industrial Beleggings Corporation Limited Debincor and Mainstraat Eiendoms Beperk Debincor a substantial holds Limited the major chemicals and explosives interest in manufacCtourrpoerration Group's investments in Highveld Steel and Vanadium AECI The Limited and through Amic in Metals Limited and Boart by joint International Limited are complemented interest with the = Federale Mynbou group Mainstraat which also holds several major investments in the steel and heavy engineering 32 npaemicpe rayh pe _ wee Directors review a 2 _ i 6 4 sector The Group indirectly has other important industrial interests in Rhodesia through Anglo American Corporation Rhodesia Limited and in Zambia through Zamanglo Industrial Corporation Limited as well as a significant holding in Barlow Rand Limited . 6 Fi ios i i a . F ay) KB ve bp ie) 4 o Q IRON STEEL AND ENGINEERING Highveld again reported improved results for the financial year to June 1977 with increased tonnages of hot metal steel blocks and vanadium slag produced Consolidated profit for the year before taxation deduction minority interests was R33,1 million in against R28 million 1975/76 These results are not strictly comparable Transalloys because 1976/77 includes for the first time the R4,6 million pre profit of Proprietary Limited which became a subsidiary in July 1976. After providing for deferred deferred tax and outside share- holders interests equity earnings were R20,7 million against R15,9 million in the previous year and earnings per share increased by 12 31 per cent to 30,6 cents Net income for the half year ended December 31 1977 amounted to R9,8 million which was at the same level as the corresponding period in 1976 : a During 1977 the steel industries of the major industrialised countries continued to run well below capacity because of lower demand and substantial imports of steel from third world and communist bloc countries This encouraged strong protectionist l^bbiesin Europe and North America which restricted South Africa's steel exports to the EuropeanEuropean Economic Community and Canada during Meanwhile current moves in the United States over trigger prices must affect South Africa's steel exports to this market in the year ahead Despite this Highveld maintained a satisfactory level of exports and the plant ran at capacity throughout the year While it appears that the downturn in local demand for steel may have levelled off there is unlikely to be any significant improvement in the foreseeable future The successful commissioning commissioning of a plate mill in August enabled Highveld to participate in new sector of the local market as a second supplier resulting in an increase domestic sales of Highveld's products with a corresponding reduction in exports of steel semis The domestic steel price increase effective from January 1 1978 will help meet increased costs that have occurred since the previous increase in December 1976 but is still insufficient to restore profit margins to former levels Demand for vanadium weakened considerably and only one of eight roasting units the Vantra division is in operation This reduced output coupled with other producers cutbacks should correct the demand imbalance The world alloy industry is also suffering from capacity and Transalloys export sales of manganese alloys were adversely affected only two of five furnaces having been in operation for most of the period under review The commissioning of Highveld's plate mill and its eighth pre- reduction kiln completes the major part its million flat product expansion programme Although financial forecasting is difficult in present conditions Highveld expects during the second half of the financial year to maintain profit margins achieved in the six months ended December 31 1977 34 - d i , a rs ie > 5 Directors review Sy During 1977 Boart a owned subsidiary of Amic rationalised and consolidated its operations following a further overseas exp^nsion in 1976. The tungsten carbide division had excellent results in r^' southern Africa offsetting setbacks in Canada and Europe where base metal and construction industries are in a depressed state The diamond drilling division performed extremely well particularly in "el Boart's the United States and South Africa In Australia where operations been completely reorganised acceptable profits were of earned in the latter half 1977. In spite of difficult trading conditions and the adverse effects of substantial foreign currency movements . Boart's after tax profits rose by 6,7 cent from R16,4 million in 1976 * to R17,5 million a further record Although conditions are not expected to improve significantly Boart predicts an increase in earnings for 1978 A Equity earnings of the Scaw group for 1977 increased by 10,6 per cent to R16 lanillion an excellent performance achieved in difficult market conditions throughout the year Despite reduced orders the iron and steel foundries maintained a satisfactory level of activity and ' sales of grinding media were similar to those of 1976. Although there was no improvement in the local demand for rolled steel exports increased The foundries expect to maintain an acceptable level of production for most of 1978 while the outlook for grinding media appears sound In view of the depressed state of the gonstruction and building industry no material improvement in domestic demand for crolled steel is foreseen in 1978. However the latest rolled steel price _ increase will offset some of the higher costs experienced since the previous increase Every effort is being made to contain costs and maintain selling prices competitive levels but announced |, price increases for electricity and other essential services and com- modities indicate a continuing upward pressure Although it appears that 1978 will be a difficult year is anticipated that Scaw's earnings and should be similar to those of 1977 Increased exports of chromite andalusite : improved efficiencies net International Pipe & Steel Investiments South Africa refractories together with resulted in > Limited IPSA in which Proprietary operating income of the refractories and mining divisions improving Group and Debin^>cor have 14,7 per by 38.6 per cent over the 1976 figres No significant upturn is to cent interest increased its consolidated profit after by 0,9 per cent expected in 1978 results for this group should be similar 1977 to R11,9 million for the year to September 1977 Equity earnings of IPSA's two subsidiaries Stewarts & Lloyds of South Africa Limited CIVIL AND ENGINEERING CONSTRUCTION Oa and Dorman Long Vanderbijl Corporation Limited decreased by 21.7 per cent to R7,9 million and increased by 20,8 per cent to R13,5 Equay 2 earnings of the LTA Limited group for the year ended March 31 1977 were million million respectively : Proprietary Wal compared with R5,2 million the previous | Union Carriage and Wagon Company Proprietary Limited year Earnings were 41 cents share as against 40 cents Wal Wal hand at March 3 1977 was valued at R271 million compared ao principal builder ofelectric locomotives and passenger coaches for the with R224 million the previous year The dividend was maintained at- -South African Railways received a million order in N^vemberfor 18,5 cents a share For the to - 586 suburban coaches the biggest single order ever placed the Railways The company also builds industrial locomotives and its six months September equity earnings were R3,2 million compared with R3,1 million the same 23 subsidiary Unionmod Buildings Proprietary Limited period in 1976. Earnings were 26 cents a share inst cents fabricated modular structures produces pre- Work in hand at September 30 1977 was valued at R298 million Net income attributable to expected that the results the months ended March 31-1978 will ordinary shareholders of Vereeniging | be similar to those of the previous financial year Refractories Limited a subsidiary of Amcoal increased slightly to I R3,3 million for the year ended December 31 1977 increase was despite substantial losses incurred by Coverland Roofs Tiles Proprietary Limited and Vitro Clay Pipes Limited which operate in TIMBER AND ALLIED INTERESTS : Mondi Paper Company Limited the equity capital of which is held by the | Group Debincor JCI manufactures and markets a wide Q Directors review . of valve hall at the in the Drakensbery Pumped Storage Scheme venture between LTA and Shaft Sinkers will produce additional electriciftoyr the national grid during peak periods = 0 paper and paper products The plant located at Merebank Durban comprises a groundwood mill three high speed paper machines and a paper finishing facility The consolidated tax earnings of Mondi and its major subsidiary South African Board Mills Limited rose from achieved R14,9 million 1976 to R17 million This increase was despite a reduced demand for newsprint in South Africa the imposition of a 15 per cent surcharge on imported raw materials and generally adverse trading conditions Although exports of newsprint remained high throughout 1977 low world prices reduced profits con- siderably Consolidated net equity carnings for 1977 were R10,2 million compared with R8,3 million in 1976. It is expected that the Mondi earnings of the year group will improve further during the current The deteriorating market for sawn timber during 1977 an had an adverse effect on S.A. Forest Investments Limited Safi and its two major subsidiaries Acme Timber Industries Limited and Peak Timbers Limited The sawmills of its subsidiaries operated below capacity and al much reduced selling prices Despite adverse trading conditions the Safi group able to increase its market penetration although profits d^'clinedsubstantially Losses were incurred in sonic of the company's other operations notably M.V. Houtprodukte Eiendoms Beperk which resulted in the Safi group incurring loss R392 000 in the ended year in 1976 December 31 1977 compared with a profit of R2,3 million : x The Natal Tanning Extract Company Limited increased its operating earnings from its production of wattle bark extract However lower sugar cane earnings interest charges arising from the funding of new afforestation areas and higher taxation reduced equity earnings from R2,3 million to R1,9 millionin 1977 products Faced with greatly reduced demand for board Bruynzeel Plywoods Limited Bruply experienced a difficult year This com- bined with severe price cutting and increasing costs resulted in a R2,4 millionj^" 1977 compared with a profit R1,4 millionin of 1976.In view of urplus capacity the industry discussions took place with the Associated Associated Associated FurnitureCompanies Limited Afcol group erger and agreementsagreements reached forthe of their chipboardinterests Bruply with those of Theresulting rationalisation should benefit and stabilise stabilise the chipboard industry in South Africa : i MOTOR AND TRANSPORT Sigma Motor Corporation Proprietary Limited completed its first full trading year as manufacturer what has been described as the worst sales year since the 1960s Despite this Sigma improved its Benetration in the passenger car market to over 14 per cent in December 1977 giving an overalloverall market share for 12 months of '11 its per cent Sigma also improved position in the commercial light market and increased its market share there from per cent 1976 tegjust over 1 per cent Despite the Automotive Division's perfor mance being better than expected Sigma's overall loss was higher ihan , anticipated at the time of the merger negotiations mainly because the cutbacckutback inin Government expenditure weakened the market in which the Equipment and Truck Division operates This division been organised and results are expected to improve significantly in 1978. With the introduction of two winning cars the Colt Galant and Mazda 323 Sigma is in a sound position to improve its market share and to maintain its position as major force in the motor industry McCarthy Group Limited is the largest retail motor organisation in South Africa comprising various companies marketing particular vehicle franchises for specific areas The group's unit sales of new passenger cars and commercial vehicles declined by 30 per cent for the year ended June 30 1977 represented 12,1 per cent of total sales in the Republic Highly competitive trading conditions reduced gross equity profit margins and this together with the drop in unit largely responsible the decline of R2,3 million in n^'t to R1,6 million for the year volume was earnings The activities of the Freight Services Holdings Limited group include clearing and forwarding buying and confirming ships agency and the servicing of ships comprehensive travel service and many ancillary services related to moving goods and people both nationally and internationally As anticipated the downturn in imports continued during 1977 but by reacting timeously to market and economic conditions thegroup increased netearnings to R4,6 million The group's interest in South African Container Depots Proprietary Limited which operates the sole customs enfranchised container handling depot in South Africa is expected to contribute considerably to 1978 earnings & CHEMICALS AND EXPLOSIVES e AECI achieved an increase in group sales of R157,8 millionin 1977 or 36,5 per cent to R590,2 million while equity earnings rose by 18,5 cent to R37,2 million The results of South African Nylon Spinners Proprietary Limited which became a whollyowned subsidiary on January 1 1977 are included in the above figures for the first time The higher profits were largely the result of the greatly improved performance particularly the second half of the year the company's based ammonia plantat Modder- fontein where following the resolution of technical plant problems output and efficiencies rose significantly The total came of sales in the Republic of South Africa was only slightly higher in 1977 than in 1976 but the level of business activity improved in most sectors of the company's operations during the second half of the year The R230- million Coalplex project a joint venture undertaking in which AECI hagja 60 per cent interest and Sentrachem Limited 40cent was commissioned during 1977. The plamis producing polyvinyl chloride acetylene PVC carbide chlorine and caustic soda The production cost of PVC compares favourably with the cost of producing this material from imported oil Notwithstanding the lower than expected demand for Coalplex products as result of depressed conditions in has the South African economy the project which is based on coal exceptional long potential The Chemical Holdings Limited group manufactures and marketsa wide range of formulated and other chemicals for industrial .36 Directors review Coverland Roof Tiles an associate of Vereeniging Refractories is supplying concrete roof tiles for approxim10a0t00ehloymes at Mitchell's ' Plain low housing development project near Cape Town applications In the year to June 30 1977 turnover rose by 36 per cent to R30,6 million while earnings in the face of sharply increased competition increased by 14,7 per cent to R1,1 million Dividends increased by 1,5 cents to 18 cents a share #FOOD After two seasons of lower production the 1977 South African maize crop rose to 9,7 million tons the third highest annual total on record with estimated domestic consumption virtually unchanged 5.8 million tons and exports significantly increased Earnings from maize exports of 2,6 million tons are expected to amount to R225 million for the year to April 1978 as against R165 million from exports of 1.5 million tons in 1977 Soetvelde Farms Limited benefited from improved climatic conditions and increased revenue from^> maize its biggest crop with consolidated profit after tax for the year to September 30 1977 increasing to R666 000. The results of the livestock division also improved particularly at the Vereeniging feedlot which is very satisfactory considering the overall weakness of the meat industry throughout this period Soetvelde recently widened significantly the scope of its operations to include fresh vegetables and fruit and improved its profit potential through the acquisition of Dewhurst Fresh Foods Limited minority interest is the largest processor purposes in South Africa producing starches glucose and various maize syrups at Germiston and Meyerton in the Transvaal and at Bellvillein the Cape the year to September 1977 earnings rose by 23 per cent to R3.2 million and dividends were increased by19 per cent to cents a share Pap, The Tongaat Group Limited's net equity earnings for the year ended March 31 1977 were R10,2 million an increase of 20,7 per cent over the previous year This eighth consecutive profit increase was a consider able achievement in the face of difficult trading conditionsin most of the sectors in whichthat group operates Despite record production and recoveries the sugar division's net contribution was lower as was that of the building materials division while the foods and feeds division and the textile division again increased profits The new International Sugar Agreement which came into force on January 1 1978 is not particularly favourable for South Africa but the industry welcomes the greater stability it will afford OKK Foods Limited which conducis an extensive meat and dairy products business in the Republic and in Swaziland again made record profits during the year ended February 28 1977. Earnings per share rose from 124,9 cents to 193,6 cents while dividends were in- creased from 44 cents to 56 cents It is anticipated that the results for subsequent financial year will show a further improvement with prospects of increasing exports from Swaziland particularly hopeful As expected the 1977 season was beset with difficulties for RFF Limited and other growers and processors of deciduous fruit in the western Cape Exces ive Excessive rains and a highly unseasonallack of sunshine reduced the size and quality peach and pear crops and because of the depressed state of principal export markets selling prices did not increase Margins were further reduced by continuing escalation in operating costs The unfavourable weather also affected the grape crop and the company's new winery suffered from teething problemis which however have now been resolved Fortunately the international for pure fruit juice concentrates was exceptionally strong Although the juice plant made a significant contribution to income RFF incurred a loss of R186 000 in the year September 1977 In Mo^ambiqu~ the two cashew _ processing companies administered by the Group Mocita S.A.R.E. and its subsidiary Antenes i S.A.R.I had a successful year in 1977. Despite severe shortages of ' power packing and raw materials and despite yields and quality i remaining below 1974 levels the two companies earned profits equivalent to R1,6 million but were unable to resume dividend i i payments in view of continuing exchange control regulations i i SUNDRY Industex Proprietary Limited manufactures various industrial textiles for the tyre rubber and other industries and spins cotton and synthetic yarns As result of the economic recession in general and in the motor industry in particular there was a substantial decline in demand for the company's products including those of its subsidiary Union Cotton Mills Proprietary Limited which operates a yarn dyeing and weaving plant In consequence consolidated net earnings for the year ended June 30 1977 declined by 25 per cent to R1,5 million . Computer Sciences Proprietary Limited a leading supplier of computer services and equipment to the South African data processing market improved its earnings in 1977. Increased recognition of AnglAomerican completed the Group's Group's Shell Housein Durban which whichwas completed during 1977 is 80 per cem occupied Directors review 1 Computer Sciences as a marketing.company marketing.company resulting froma higher level of customer service and a strong emphasis on staff development contributed to the year's year's results and the company has become major force the computer and services industry Anmercosa Computer Services Proprietary Limited wholly- wholly- Group associated consultancy owned subsidiary of the Corporation provides computer services to the and its companies Further details of the principal industrial and commercial companies within the Anglo AmericaAnmerican Corporation Group and thosein which the Group 15 months ended September 30 1976. In view of the company's overail financial position no dividend has been declared for the 18 months Sorce has now concluded its extensive building programme started in 1969 with the completion of Life Centre in the new Stock Exchange area Total House in Braamfontein and the remodelled and expanded Killarney Mall aliln Johannesburg and Shell House in Cape Town perthi e po erid od under review Wesbank House was sold and arrangements between Sanlam and the Sorec group in relation to the Sanso group of companies were terminated Although the shop and office markets in all major centres in South Africa are heavily oversupplied 96 per cent of the 775 square metres of shops and 84 per cent of the 380 291 square metres of offices managed Anglo American Property Services for the Group were let at competitive rentals reasonable rental growth assured through the negotiation of satisfactory escalation rates for all leases concluded Carlton Centre improves profit fH ; In the short term the property groups will not reflect substantial increases in profits as long as interest rates remain high rentals and land selling prices continue to be eroded surplus space is availablein all areas of the market and costs continue to rise Group's The American property interests managed by Anglo city Property } Services Proprietary Limited include central shop and office Ww Further details of the principal property companies administered within the shopping i complexes complexes suburban centres and residential commercial Anglo American Corporation Group and those in which the Group holds a i and industrial township township land The investments are held mainly significant interest are given on page 100 . through Anglo American Properties Limited Amaprop the property t owning subsidiaries of the African Eagle Life Assurance Society Limitedincluding Soree Limited Anglo Anierican Coal Corporation Limited African Townships Mining and Finance Corporation Limited Creative Homes Limited Kenilworth Centre Proprietary Limited Marina da Gaima Limited and Carlton Centre Limited Amaprop reported a loss the months ended March 1978 of R655 000 compared with loss of R206 000 the previous year This Exploration and research Emphasis on search for uranium continues increased loss is largely because ofa R475 000 reduction in dividends _ Exploration for a wide range of base metals and uranium continued in received from Isipingo Property Investments Limited the owners of Prospecton Industrial Township Demand for industrial township land at a low ebb and any improvement will depend on a general upturn South Africa South West Namibia andin many other parts of the world with a significant proportion of total prospecting expenditure in southern Africa devoted to the search for uranium in the economy Land sales at the Marina da Gama development in Muizenberg Cape Town have increased over the previous year with the prospect of further sales in the current year The owned Cabana Beach resort hotel maintained its earnings in difficult trading market The Group and associates have ^ per cent interest in Carlton Centre Limited which owns and operates the Carlton Centre com- prising a storey office tower the storey Carlton Hotel a major Results from an investigation ofa secondary uranium deposit in the western Cape liave been encouraging and Grilling and metallurgical work is proceeding while in the Karoo the joint investigation for uranium with Empresa Nacional del Uranio S.A. the Spanish nuclear company continues In the Namiby Desert near Swakopmund South West Namibia large but grade conjunction secondary uranium deposits are being examined in conjunction Minatome Omitaramines and Corporation Limited with ; shopping centre covered parking for 2,000 cars and an ice rink Carlton Centre Limited made an after profit for the year ended June 30 1977 of R952 000 - including a R74 000 profit on the repurchase of its comp=acor mpe ard ed with R782 000 for the previous year and for the six months ended December 31 1977 earnings amounted to R1,4 million including a profit of R617000 R617000 realised on the purchase of additional debentures The net earnings of Sorec Limited the 18 months ended March Several base metal prospects were examined and drilled at number of places in the Transvaal Cape Province and South West Namibia Initial indications in some cases have been sufficiently #promising to warrant further examination a and new copper discoveryin southern South West Africa Namibia is of particular interest In June 1977 the Corporation entered into an agreement with | Newmont Mining Corporation O'okiep Copper Company Limited to acquire 45 per cent interest in the Gamsberg lead deposit As yom a 31 amounted to .1,2 million compared with R2 million for the a result of feasibility study the partners decided not to develop the 41 Directors review Prospect drillfoir gnolgd south of the Ca^-avieriesmine at Jacobina in the state of Bahia Brazil property immediately because of the unfavourable zine market market was decided however to continue geological and metallurgical work on the deposit pending an improvement in the market In addition to exploration by the gold mining companies within mining lease areas drilling continued on adjacent properties and elsewhere In the Dankbaarheid block adjoining Free State Saaiplaas the drilling programme is virtually complete and has yielded interesting results which will be assessed during 1978. Significant uranium and gold values are still being obtainedin various reefs south of the Orange Free State goldfields but further drilling will have to be undertaken to judg~ more clearly the potential of the area In general the results of drilling south and south west of the Vaal Reefs general mine of have been disappointing Exploration for uranium north Klerksdorp has yielded sufficiently favourable indications to warrant continuing with the current programme Drillingis to resume in a block south of the Western Areas mine where encouraging values were obtained during 1976. Prospectingin other areas has so far failed to discloasney significant results The coal exploration programme over the past decade has resulted in the Group attaining an extremely strong position coal reserve holdings During this period rights to about 2,5 billion additional run mine tons in large viable coalfields have been purchased while the forward exploration programine aims to acquire rights to a further three billion much of which is already partly proven and held under option by Group companies Together with historically coalfields total reserves of the Group should exceed nine billion tons by 1981. The main emphasis during the year continuedto lie on the further consolidation of Group holdings in previously previously discovered coalfields eastern Transvaal the south east of the as well an expansion into new areas province The programme involved the acquisition of coal rights going drilling and reserve evaluations > Exploration has also been carried out on behalf of the coal mining i in companies their mining areas In Natal search has been for further grade anthracite reserves The Group has maintained its exploration activities beyond softhern AfricaAustralian Anglo American Limited was active in Australia Papua New Guinea New Zealand and Fiji the Kimberley : of Western Australia extensions to theSally Malay nickel and copper deposit are being sought as well additional mineral zones in the area Other prospects are being investigated in Tasmania mainland Australia and in New Zealand During 1977 Consolidated Zinc Rio Tinto Australia Limited CRA joined the Amax Australian Anglo American Preussag joint venture which is investigating the Namosi porphyry copper deposit in Fiji A drilling programme using reverse circulation equipment was carried out during the year with encouraging results Early 1978 Preussag and exercised their option earn their respective interests in the joint venture and a second phase of work which includes metallurgical and engineering investigations has started Other exploration through Anglo Pacific Exploration in Fiji located base metal mineralisation which is being further investigated : In Brazil Anglo American Corporation do Brasil Limitada Ambras is conducting substantial exploration for gold and base metals through Unigeo Geologia e Minera^^So.A. This company is also continuing with feasibility studies of the Jacobina auriferous conglomeratesin the state of Bahia Although substantial tonnages of gold ore have been identified is not yet possible to determine whether these low- to medium reserves can be econoinically higher mined at prospective gold prices and the extent of indicated grade tonnages is now being investigated Charter Consolidated Limited has continued prospecting pro- grammes in Ireland Spain and France mainly for base metal and tungsten minerals In U.K. North Sea a group of companies in which Charter has slightly more than an eight per cent interest has been awarded a fifth round licence over two adjacen^>blocks in the Moray Firth region One block has also been retained from the fourth round licence held by a group in which Charter has a 25 per cent interest Charter also participates in the exploration programmes of Australian Anglo American and Ambras Joint exploration in Canada between Anglo American Corporation of Canada Limited and Hudson Bay Exploration and Development Company Limited continued in British Columbia Yukon Ontario Quebec and in certain prospect areas in Saskatchewan Hudson Bay Exploration explored for its own account Manitoba Saskatchewan and the western United States Trend Exploration Limited continued oil exploration in Indonesia and in the United States Canadian Merrill Limited participated in active drilling both in Canada and in the United States Francana Oil andGas Limited was involved in drilling in Canada and a discovery Tangleflags was made of heavy oil and in theTangleflags Saskatchewan y ok fieldin central , RESEARCH The conetrad Anglo American Research Laboratories in Metallurgical JMS and Metallurgical Scheme considerable East work Rand A inin the Orange Free State amount of testing was also Lease Ergo on the has nori Witwatersrand series ores In all cases theamenability of these to one more of the wide range of extraction processes developed over the years has been demonstrated Attention has also been paid scale plant testing of the use of activated carbon in gold and uranium circuits with consid^'rable success particularly for gold recovery The Corporation holds certain relevant relevant patents and arrange- ments are in hand for the manufacture the carbon materials of through The Natal Tanning Extract Company Limited Further progress has been made in the production process of super- grade magnesium oxide and patent protection has been obtained Advantages include the ability to process grade materials as well as 40 provide substantially improved environmental conditions compared with other processes in use Some work has been carried out on the extraction of metal values from undersea manganese nodules : . G Directors review and also on the recovery of tungsten from grade ores A number of 3 other base metal testing programmes has continued particularly on southern African ores with work also Preliminary research indicated the economic feasibility of waste stowing in mined stopes It is possible that this being undertaken overseas overseas the most may prove to be mines including those in Australia Brazil North America This is promising method of counteracting problems arising from in addition to the continuing effort on behalf of increasing depth and lateral spread of worked areas Rhodesia and in Botswana our operations in mining proceeds The only alternative to minimise the as * Aswas to be expected some problems pressures would be to leave substantial areas unmined whiicnhcreasing occurred in the Electronics Laboratory fire detection systems after term exposure to would adversely affect operations During the year waste filling has been proved to be technically feasible but operating conditions These were rectified and should new development not recur A been been experienced and this will have severe wear of components has being studied is the use of the Becon Mark II to be considerably reduced to monitoring detector for dust improve the economics of the process Another method using The techniques of telemetering developed for use with hydraulic filling with fine tailings residues has also been detectors are now being extended to other mining the fire demonstrated on a small scale and intermediate scale testing has rapid accurate activities where and * monitoring transmission of information is essential to enable corrective action to be started underground Effective use of either one or both of these techniques would have a major impact on has been made taken Areas where progress include fans underground chilled water v control asubstantially improving the underground setnovpiirngonompeernattions as well The use of continuous machine water circuits and underground pumps Work is miners for the mining of coal increased in conjunction with the Council for Scientific and Industrialcontinuing during the year Associated research on optimising and modifying the and AECI Limited on the development of Research design of these machines for local conditons continued at the Chamber blasting devices which if controlled sequential of Mines Progress was made in the research successful : would result in a significant disposal of ash into programme on the improvement in productivity these previously mined areas It is now apparent that Perhaps most important development during the has been methods will allow the mining of limited additional tonnages of the improvement and standardisation of maximum demyaeanrd coal in thick seam conditions where previous mining only extracted- ling units now being used noi only in our control- part of the seam e a well With the rapid increase in the mines but in industries as The development of circuit to beneficiate the based upon maximum price of power which is partly demand the limitation or smoothing of this -0,5mm fraction of raw coal at the Landau and Bank collieries in which includes the experimental progress This work demand without adversely affecting operations is of considerable circuit erected the Fuel treatment of material at a pilot economic importance and success is being achieved in this field Research Institute may ultimately allow the of the mining field collaboration particularly with the Chamber recovery ofadditional low coal at these two collieries Mines is continuing while the Group's mining research facilities have continued their efforts to solve particular mine ^ Further details of the principal prospecting companies administered major development problems Raise boring the Anglo American Corporation Group are within activity in previous years has now become a Group given on page 102 fully operational production process June 23 1978 hs See os The annualfinancial statements appear on pages 46 to 74 were . oog approved a by the board of directorsdirectors oon n June 231978 and are signed US on itsbehalf a al8 Directors report46 7 3 . Consolidated balance sheet So a income Consolidated incomestatement 51 51 Balance sheet 52 ee ~ Income statement 53 ome statements 54 Notes to the financial a Statement | Source and application Subsidiaries - 64 of funds Statement 63 eS 71 General investment 71 Directors 8 60 HF Oppenheimer - : ; Keith Acutt GWH '.JT JT Goldfinch Managing Secretary GC Leeman ChiefAccountant we rn SS fe, the members Anglo American Corporation of South Africa Limited sseutbsidiariesfinancial examination the We have examined the annual statements and group annual financial statements out on pages 46 74 and ooo. our opinion based our the reports 6f the Bev auditors those not audited us the financial statements fairly present manner required by the Compani Act the financial position of the Corporation and the Group at March 1978 and the results of their operations for fifteen months ended on that date - Aa ts es i Chartered oa AIKEN & CARTER GOLDBY COMPTON & MACKELVIE Chartered Accountants S.A. The directors pleasure in submitting the annual financial statements of the Corporation together with the consolidated annual .. financial statements of the Corporation and its subsidiaries terms of the merger arrangements with the Rand Selection Corporation Limited Rand Selection group the financial year ends both groups were changed to March The financial statements accordingly cover the fifteen months from January 1 1977 March 31.1978 ' . .-* 5 : MERGER WITH RAND SELECTION * The merger arrangements provided for Rand Selection to become a wholly subsidiary the Corporation by the cancellation of the Rand Selection shares held by shareholders other than the ee to Corporation and its subsidiaries and the issue such shareholders of in 200 ordinary shares the Corporation for every Rand Selection Selection shares held ore ane : ee A prerequisite for the merger was Rand Selection would make rights offer to raise 500.000 to repay its short borrowings from the Corporation to provide for envisagedenvisaged commitments gach Accordingly 10 562 538 Rand Selection ordinary shares of 50 cents were a offered at price of 800 cent shas re to Rand Selection shareholders the ratio of 25 newshares for every 100 shares The rights offer was so arranged that subscribers for Rand Selection in shares received paid ordinary the poration the for ratio of the merger terms stated above Subscriptions were received of approximately 52 per cent the shares offered and the balance was taken up by De Beers Consolidated Mines Limited which underwrote Members 2 were informed in press announcement published on an May 1977 that the Supreme Court of South Africa granted , Order on May 1977 confirming the reductoif othne capital of Rand : Selection give effect the merger of the Corporation with Rand CONSOLIDATED FINANCIAL STATEMENTS The comments that follow relate to the consolidated sheet statement balance and the consolidated income the Corporatiaondn its subsidiaries The results of Selection and its subsidiaries and other companies which by virtue of the merger also became sub- are sidiaries included in these financial ef ective statements from January 1 Rand 1977 that being the effective date of the merger with Selec tion Accordingly the: figures in the financial statements Rand arenot comparable se _ caer aie CAPITAL 000 Al January 1-1977 The authorised capital was R20 in 140 000 000 ordinary shares 10 cents each 1241 1241 250 six in six cent oo was cumulative preference shares of RT each and 758.750 six cumulative preferred stock In terms special resolution per cent on May 1977 the authorised authorised capital registered increased from to R30 000 000 by the creation 100 R20 000 000 : / 000 000 new ordinary shares of 10 cents each : : re Me of At January 1-1977 issued capital R17 280 consisting - 4 re) nO Pot ; canes 725 ordinary 300 shares of 10 cents cach granted to the directors in terms of section # fully and Companies paid 750 six per cent cumulative preferred stock 221 of the yf Act 1973 as amended These general authorities remain min consideration for the cancellation of their 34 999 828 shares in until the next annual general meeting is valid orily shares Rand Selection 69 999 656 ordinary in the Corporation were which 18 1978 and members will be asked that be held on August issued the formershareholders Corporation and its : in Rand Selection other than the ordinary resolution placing the at remaining meeting to consider an unissued ordinary subsidiaries and 21 125 076 the Corporation's ordinary shares credited as fully issued preference shares under the control of the directors The full text of the were the Rand Selection rights offer paid the subscribers proposed resolution is set out in the notice convening convening the annual 500 general shares In terms of the share incentive scheme114 114 ordinary meeting SELECTION were issued at ruling market prices to senior employees including RAND US 167 000 AND A HALF directors holdingbalnce salaried employment March CENT remained 31 1978 there - CONVERTIBLE LOAN 1986 SIX shares a balance of 387 500 * available for issue in terms the In February 1971 Rand Selection raised a six PER half 7 cent and share incentive scheme per ordinary A further 46.000 options shares held senior members US 000.000 R21 288 000 loan represented by 30 000 bearer bonds of staff lapsed * during the fifteen by months review , - of US 1000 each Prior to the mergerRaRnd and Selection bond- until March balance 463 800 options outstandingat 1978.leaving a -holders had the right at time January 31 1986 to convert capital or been exercised since March 1978 > options their bonds into ordinary shares in in the of Rand Selection at a March price share At 31 1978 the issued capital was R27 203 of R11,75 a calculated at fixed exchangerate of RI to consisting 222 964 532 ordinary shares of 10 cents each fully paid of USS1,40 As part of the arrangements bondholders agreed to six and R4 758 750 per cent cumulative preferred stock the modification of the conversion rightsattaching bonds attaching their bonds so, 10,5 1978 Corporation announced that it oO that the are now convertible proposed to shareCorporation instead of shares Rand into ordinary shares the R40 million raise cumulative 10,5 10,5 cent by means of a placing of having private cumulative redeemablepreference shares an average life of in Selection ata price R5,875R5,875 a share calculated at same fixed exchange exchange of R1 US 1,40 Therewere bond commitments financing for the purpose ongoing conversions during duringor subsequent to the fifteen- Details month accounting period there issue were contained in circular to members 1978 dated June 1 and were accordingly 20 167 bonds outstanding at the date of this report To conversion Corporation conveninga general meeting of Corporation whichwhich was held respect these unconverted satisfy the rights : 23 1978. At that meeting members approved resolutions in in ordinary bonds 2 451-914 ofthe > shares being Corporation's which the Corporation's Corporation's unissued preference capital of ordinary are heldin reserve ' shares SHARE 24de 1 250 in of R cacliwas divided into 49 650 000 PREMIUM ; mable account stood R202 000 under the ccounmturollatoifvteheprdeiferreecntcoersshtahreesArotif2c,l5esceonftsAsesaocchiaatnidopnlwaecreed At January 1977 the share premiumpremium at 91 amended redesignate thecumulative preference shares as MR2a6y7R267 1970700 732 shares were issued at premium of redeemable cumulative cumulative preference sharesshares andprovision wasmade for 907 in respect of the merger with Rand Selection This dividend the rate and terms redemption of the preference shares to increased the share premium account to R268 109 000. In terms ofa resolution isue be directors or by the Corporation in general special of the passed by members on April 25 1977 and Order issue It intended to issue 40 000 of these Registrar shares on July 1 1978 at premium of cents share Supreme Court of South Africa both of whichwere registered by the of Companies onMay 1977 the share preraium account which willmean that Corporation's issued capital increase by was eliminated the transfer of R268 169 000 non- distributable premium R39 million It not intended to listing for these shares which anticipated reserve Since then 114.500 Incentive scheme shares mentioned above have been issued atruling market prices The ; resulting premium was equal halfyearly instalments applied in writing off share expenses commencing amounting to R470 000 theissue of the 40 - million cumulative preference 1978 premium shares remaining be 650 000 will : redeemable preference shares on July a of R39 ordinary shares were unissued March Corporation Of the 17 035 468 whichwere at 31 : million will accrue to the the INVESTMENTS 1978 specific authority has beengranted to the directors to allot and aye under Issue up to 300 shares in respect of the share option and share During the fifteen months review incentive schemes 2451 2451 shares substitution for ordinary investments held the Corporation as sharesRand Selectionarising conversion of bonds US 000 * R309 000 R835-575 000 of unlisted each representing the | Rand SefectionSefection USS20 167.000 167.000 sixhalf to by R302 770 000 and which investments increased investments increased per cent convertible loan 1986. The balance of 732 254 unissued unissued : by 117000 117000 The marketmarket value listed general investments March 31 1978 was ordinary shares together with 9.650 000 unissued redeemable cumulative R1 996 731 000 and exceeded the book value by RI 282 952 000 preference authorities excess end The shares subject are the of general compared with an ofR5212000 R5212000 R5210 R5212000 at the 1976. a th oreay es . owgenral general per : unlisted investments were valuedat 123,6 centabove the Taxation ti : Secretary book value R121 000 compared with valuation last year The for Inland Revenue has changed the previous practice _ yc which was 46,546,5 cent above then book value substantialsubstantial : employedover many years in respect of certain expenditure claimed investments largely increasein held = reflects the merger with Rand as adeduction tax in the financial year 1976 Group unappropriated profit brought forward from 1976 been adjusted : subsidCiOarMyPANIES which under paapypmleinetdW=w report 7 SUBSIDIARY - me : Corporation by RI 298 000 being the additional tax incurred Objectionto the = raised the authorities and * Details companies in the Corporation has a direct assessment by tax is being lodged has been under protest indiret indiret interest interest given on pages 64 70. Particulars of special of the additional tax Taxation for the period to March 31,1978 31,1978 has been provided otn he : ; . passed by these companies during the the review assumption that the revised basis of assessment will be : objection page 103 of this : it is intended that an However will be lodged fe oe 0 resolutionsAPPROPRIATIONS Extraordinary Central : which flow income of the enlarged group is higher in the quarter to each year the results for the months under review clude two March quarters are enhanced accordingly No Sur accrued to the Group from the lifeinsurance operation during March The fifteen months ended R241 copper taxation for the period was was dealt as follows ' woe Group profit after 651 1976 R89 218 000 and 15 Months 12 Montlis : During 31 March ended ended . & March December in 1978 ~ 1976 R000's 651~ satisfactory 241,651 R000's 89-218 - item Due to the unsettled politicalcocnditons onditions in Africa together with theeconomic difficulties experienced by Za^flre and the low -o.- .~ copper price it was not possible to concludesatisfactory financing arrangements for the Soci^'t^M'ini^rede Fungurume SMTF project in Za^flreand work was therefore suspendedin January 1976. The Corporation and Rand in Selectionin1976 consequently made 5 provisions of 000 R20 000 and R10 000 respectively against the value of theirinvestments SMTF 1977 the copper price remained depressed and was not possible - to raise finance on terms for this projectfurther provision ofR10 363.000 : 363.000 | therefore been madeagainst the Group's investment investmentin SMTF so : thatthe bookvaluehas been provided against full in year Unappropriated Unappropriated profit 552 025 17527 principal project lenders for the financial restructuringof subsidiaries Limited BRST and its 85 per cent subsidiary BCL whichThe operates the coppernickel mine at SelebiThe Corporation and its BRST as well as an obligation to provide a net 20,2 thefinances required ' to meet certain _ completion given to lenders to BCL The restructuring arrangements undertakings were concluded on March 161978. Further details of these : arrangements are given in the Directors review on page 11. The need completion for restructuring arose inter alia from the technical requirements under the original financifng inancing arrangements for the project and the restructuring involves significant significant changes in these -; .. arrangementsmeet the requirements the principal project lenders and those of the Botswana Government In these circumstances and as reflected second interim report the Corporation published on February 1978 the directors have considered it prudent to Group's 907,000 completion 16 950 39 477. provide in full as extraordinary charge R25 907,000 Group's investment in BRST at March 31 1978 against the ~ Consequent upon upon the restructuring arrangements the y * : undertakings in respect of phase one of the project have been met Work is progressing of phase two which on its completion will enable the remaining undertakings to be met It is considered . 23 S01: further capital investedterms of the restructuring arrangements reasonable reasonable investment prospect achieving that of be recovered over the n'edium and also that there is 13-976 ; a return on DIVIDENDS declared A special dividend No. 82 of 8.25 cents ashare was declared on May 3. 1977. 1977. An interim dividend No. cents final share 19768 t forthcomingannual general meeting In addition a A Etheredge CJ L Griffith Langton F ~ D Wilson and SirAlbertRobinson : en There service granted contracts by the subsidiaries of . Corporation or any its . Corporation : to any directors of > the ; ge = es) ale . Consolidated balance sheet . AT MARCH 31.1978 31.1978 OR 7 7 7 Dy ue : ; * ANGLO AMERICAN CORPORATION OF SOUTHSOUTHAFRICA LIMITED AND ITS SUBSIDIARY COMPANIES aed ee we a SES : Tt JOT Notes 31.3.78 Ordinary shares .2. : Share premium 2.0. a distributable yy ; Distributable reserves 200. Ordinary shareholdersequity Preferred stock an 296 ee 365 819 .470 204 eB 13.172 Pr eh 202 <2 214 367104 319 4759 a 469 692 759 25 863 078 166 541 456.767 92-23192-231 419 139 =5 2-220 474 4548 "60.038... . ad go Shareholders for dividends . Bank overdrafts 62 651 SE 55.741 or 11 268 2 2 129 660 marketvalueR1996731 000 1976 R934-221 R934-221 000 provision directors valuation R272 296 000 1976 R168 059 000 a 8.2088.208 o. 640 J 335101 335101 949 443 636. 2129 31.3.78 .R000's ' Year ended 31.12.76 R000's = 181 49.736: 2.001 : 918 attributable the March 31 1978 Balance sheet ATMARCH 1978 Lay ? ANGLO AMERICAN CORPORATION OF SOUTH AFRICA LIMITED ' ' Notes 80 31.3.78 We : 31.12.76 2 "= R000's 172 $ 202 84 148 207 930 .185.242 = 393 695 Office research transport equipment . Income statement : - a. : FOR THE FIFTEEN MON MON HS ENDED MARCH 31 1978- deducting Income Income from subsidiaries interestfees othersources after nistration ; on officeresearch and transportequipment tostaff pension funds Unappropriated profit March 1978 investments Where predominantly unlisted listed and of the group are predominantly ini come ncomeearning longterm holdings in the opinionof the directors a permanem diminution thevalue an investmentflowing from norvmaal circumstances os has occurred provision fosr uch diminutionischarged against current profits ( ) Expenditure Expenditure including interest where applicable relating to the development insurance investments investmentsinvestments is capitalised and included : ofland and buildings formingformingpart ofthe foreseeable future rights Mineral Mineral expenditure down in the and certain development development expenditure expenditure expenditure iswritten to a nominal Income in respect of instalment debtors and leasing " Deferred taxation a (=" Deferred taxation is providedprovided arthearthe current rate normal tax ( The excess the book values of leasing assets over their tax values {Taxation allowances relating valuteoswnship township propertydebtors shares were placed incentiveincentive scheme for senior members of the staff - Exercised . distributable reserve ng ae a Theincrease in the nondistributable reserve arises as followsfollows a Corporation at oj. 148 Balance December 31.1976 2. 109 oe268 ol Transfer from share premium see note ).. & , acquired attributable d3istributable reserves ofof subsidiariessubsidiaries the Corporation'sCorporation's former minority interest during the period T@ransfer per income statement : Other items Less Share and issue issue merger expenses : -'s" Adjustment opening balance changesin s Adjustmentinsurance subsidiary Group R000's o 214 268.109 -> 365 819 s Group ra Generalpropriated Unap Currei ncy reserve propriated Lie = 367 1042 3 ( : 1298 . : os Adjustment arising arising from changes in exchange rates ( 1.191 Reserves of subsidiaries acquired during 7 the periodattributable to the Corporation'sCorporation's 62.441 595 69.919 470 204 449 014 Registered unsecured rand debentures Registered unsecured notes ). Lifeinsiurancensurance insurance subsidiaries ) Mortgage loan . : . ar oe i . i ae Loandis participated asfollows ae, > et Rand Rand Selection Corporation Limited RSC . . Others Bea, wes : 31.3.78 31.3.78 R000's 31.12.76 31.12.76 R000's ~ 9533 142 : poe 19 282 9 874 AS 18815 | 016 ; Details of the individual individual loans are follows o ; , : ba Swiss francs 000 000 * * . . a repayable by ees The loan interest the rate of 5.75 per cent per and annum is is a Bae! November November 15.1987 subject to the undertaking ~- that the Corporation will if possible purchasein the markerfor cancellation up to Swiss francs 7.500 000 the loanat prices . not exceeding par each of the four 60 day periods prior to November 15 in the years1983 to 1986. The Corporation has the loans c and Dollar These participations are Corporation RSC by participations the These arethe: as of : and raised loan raised cee Qo an associated company instalments each theyears per repayable in The loans bear interest the : rate of6.966.96 cent per annum and are in 1978 80 1982 as follows Lge : AngloAmerican Corporation June on in : : : * 802 000 Rand Selection Corporation 1.054 000 F) S2856 000 6 repayable 000 ) US 47.000 000 : cd The loan bears interest at the rate of 7,75,5 per centper annum and isis : ot atpar in of instalments 500 onMarch lin 5 years each of the years 1979 to 1981 inclusive 2 500 000 on March 1 1982 58 000 000 March in eachof the Corporation earlier 1987 inclusive The may in certain circumstances make repayment 000 1983to US 167 ' RSChasbeen or theoccasion of next payment dueinrespect of the loan will be anySouth African taxesThe conditions ofissuethe loanrequire thatanysuch taxes shall shallbe 5 redeemed equal willbe 15 in in annual redemption 1983 with the final redemption : cancelled r atsuch priceas itmaydeem fit Any debentures debentures so purchased will and thepurmchase Such cancelled debentures shall firstbe applied iin n reducing the nextredemption or redemptions - : secured by mortgage over land and a buildings having a book value of R1.214 000 and bears interiest nterest interest attherate of 6,265,265,25 per cent per annum It is in repayable yearly instalments of R5 000 until December 22 1984 and the remaining balance 000 8 8 the annum yearly Theloan bears interest at rate of 9.5 per cent per annum andis repayablein half covered by forward exchange contract ; : instalments of 55 000. The loan is mo . insurance Life insuri ance nsurance furids of liabilities " Thelifeinsurance funds at March 1978 exceeded the amount of the actuarial valuation valuation contracts date and surpluses = at that include additional ineir nner reserves and unallocated Fay Soe under insurance insurance policies and @ n 31-1976 : in subsidiary companies amounted toR92-23-1 R92-23-1 000 at March 1978December 31-1976 R63 : 008 000 made up of R23 000 in the insurance group and R68 596 000 December 1976 R63 008 000 in other excess 7 companiesAt March1978 there was also attributable to thien shareholdersthe nonn oninsurance subsidiaries subsidiaries their interest .+ valuations of listed and i As market values values values and directors valuations are not disclosed in in respect of investments which form part the is ae* corresponding figure is not computed in respect of the outside shareholders inin the insurance SSubsidaries ubsidiaries 1 redeemable public authorityauthoritystocks debenture stocks and all dated fixed interest stocks including - preference shares whichare normally held toredemption aarere reflectedat amounts related toto oO coup Fixed ye PR 5 ne Me 31.3.78 31.12.76 Cost deprciaton Aggregate valuation depreciation and wey amounts > written off ". - Book value 31.3.78 * oe, a Cost or | Aggregate valuation depreciation and . : . 5 amounis written off : Book- . value 31.12.76 : .R000's =... R000's : 751 a: R000's R000's '.R000's R000's . . - LF 9318 9318 . : ~ -. 159 187 852 1210 38 762 4397 Furniture motorvehiclesand equipmentat cost less accumulated depreciation and amounts guaranteewith others to a diamond mining company inrespect which thatcompany has Limited respect Corporation 20 Vanadium Limited of US 20,000,000 The servicing contraacntds South covered by forward exchange Highveld Highveld Steel and +: US 000 000 1976 DM100 000 000 repaymentof the loan with the African oo . Hni ES . nee Corporation ae 31.12.76 31.3.78 ; R000's R000's 7145 579 566 | 17186 12557 4629 : 7 " 10 766 6.900 6.900 oo 3.866 iii - Guarantees with another to certain lenders to BCL Limited to the extent of the equivalent of Which amount has been guaranteed as to a A guarantee with another of loan to the Government of the eee Republic of Botswana equivalent to vee e eee cere terete Which amount has been guaranteed as to .:.. completion undertakings Which were guaranteed as to Group we 31.3.78 31.12.76 R000's R000'S os. | 7145 ~ 495 63 055 37 166 eet guarantees iv Other Ege. eee Pee a Seeveee Which have guaranteed to : : Ley ne 68.100 ie | 42 670 25-430 18 89 032 41884 41884 : 148 . b given by the Corporation shoinwinv above include an 1976 000 080 000 guarantee in respect of loan advancegodld mining companies an amount of R34 080 000 1976 R34 The Corporation's obligation has been guaranteed eg in b There are commitinents respect of : pS ech . ) BCL Limited . Corporation Undertakings wherebywhereby and another undertake undertake provide or procure 37,5 per cent of of pollution control aggregate a any finance may be required to complete Phase two of the BCL project equivalent R10 500 000 for : b required by BCL Limited up to an amount of the equivalent ; expenditure during the period January 1978 December 31 1983 @ : during up to an aggregate amount of the equivalent of R43 884 000 which may be required by BCL Limited the period . opis kinds other than deficiencies arising from oS a of all March 1978 to December 1981 to meet cash deficiencies aceleration of indebtedness or =! , : . incurred for the completion of the project or pollution incurred of the control couuitments been assumed by subsidiary companies or ( Undertakings to subscribe procure subscriptions subsidaries authorised acquire subsidiaries iii In respect of capital expenditure authorised authorised by the boards in and make loans other concerns subsidiaries but not contracted for amounting Listed 2. Unlisted 2. +. 8 Group ee oe Investment income ~ General . investments 31.3.78 R000's ' 179 31.12.76 R000's 4 281 YP 448 100513 25.729 _ 17. Taxation Corporation 31.12.76 31.3.78 R000's 1.412 R000's - 7 5917 ?- South African . 1100 Foreign 4. ; ; 2512 11 2.501 . a 7367 x boat adjustment in respect a : ; of previous period x . Group 31.3.78 31.3.78 31.12.76 R000's -. R000's 10 502 2002 2002 . 3.923 2760 425 205 4.770 123 647 . fh - : 2807 2807 .7367 oo, . os , FeeJ en 807 BAS 220 44647 647 Secretary has The for Inland Revenue changed the previous practice employed over many , in respect ofcertain expenditure by claimed as a deduction tax in the financial 1976. Objection to the assessment raised the tax authoritiesis being lodged of ~ and payment of the additional has been made under protest The unappropriated profit of the Corporation and the Group a brought forward from 1976 has been adjusted by 298 000 being the additional tax incurred However assumption for / Taxation the period to March 31.1978 has been provided on the it it is intended that objection will lodged that the revised basis of applied assessment will ei Beg 18. Profit after taxation following : Theprofits the Corporation and thegroup have ~ taking Corporation ae : been arrived arrived at after ; Cot into account the 6 following expenditure ane Group =: 31.3.78 R000's eo 129 : SS professional Administration ee Audit fees fees sees ae ae 1 31.12.76 31.3.78 oF ; R000's 31.12.76 R000's 4 3.932 : 1521 2 WO 593 144 leasing Depreciation Depreciation ofplantmachinery motor vehicles furniture and equipment - 973 : assets ad es pe Lh 6054 z ee Leasing charges - ee , .. 2.400 remuneration Directors a WEE 7 : a . - oie Ls payable Theaggregate amount the Corporation's Corporation's directors and alternate directors by the Corporation and its subsidiary : companies is as follows aan : a wy oe ve a : ees : an : Oe companies 31.3.78 31.12.76 . RO00's oo R000's : S58 Se 110 94 21.879 EON 1.252 1.346 .90 .87 The issued ordinary share capital Corporation in of the is 222.964 222.964 532 shares However the earnings per share have been . on based the number of fiten ordinary fifteen March effective sharsehares months ordinary capital December Issued Sharesissued in issue during the | at 311976 311976 o to ve . 1978 calculated as follows . ; : : : : ) "2 Shares 2 131 725 300 . : : Selection Corporation In respect the acquisition of Rand with effect from January 1 1977 " In of the rightsissue the Rand Selection Corporation shareholders in May 1977 125 076 Meee ae) respect ordinary ordinary ; sharesin Anglo American Corporation reduced during the fifteen months to March 31 1978 inin proportion the period the shares were in issue : . 2 _ 69 999 656 Ce 228 626 Interms of the share incentive scheme : : Le ae OR 114 5 082 > 068 21. Dividends ae On preferred stock : . declared No. 96 of three per cent cent June1977 No. of three per Corporation oe " . 31:12:76 31.3.78 . b ; Less Tax relief claimed in respect of proportion investment . Lay 31.3.78 3.1.12.76 2 R000's R000's | 143 143 fa .143 6 1431 10.534 10.534 32.931 : e 7 E a oes Corporation : - . oo soy : Year 1976 wa 1978 ee : R000's "te. RO00's oe s ot : |. crue Source funds | Poe shareholders 132 116 =). Profit before taxation and outside interest ne against adjustments from o 6.99 9.627 Add Provision investme. nts and loans loans less net : arising dS 141 743 . 276712 * 136 876 * 128.702 ~ 0s Creditors taxation taxation and provisions Investment Decir n ce ost a shasree s "7 . - Net decrease iinn loans and amounts due a oe of funds Application vestment in subsidiary shares Increase in cost of loans Net decreasein e companies and amounis amounis due amounis * Cost ofgeneralinvestmentsacquired less costcost of investments sold . Property mineral rights and equipment- pes Loans to associated companies and others Loans from associated companies and others Repaymenotf loan capital net Outside shareholders interest interest in subsidiary : Taxation Dividends .. _ Creditors taxation and provisions Debtors cash . 22 3. 2, Net investment insubsidiaries acquiredduring the period see below . t : Explanatory nnoteote tosource of funds statement January 1977 1 . Net investment iin n subsidiariesacquired during the periodJanuary . ~ Investment net loans to these subsidiaries at , Reserves attributable to the Corporation's former minority interest ; Net assets at March 1978 of subsidiaries acquired acquired during the period : Represented by General investments ~. investments Lifeinsurance Fixed assets .. - Leasing assets 35 Instalment debtorslessdeferred income Loans ~ associated companies and others Stocks stores and workin -. progress Debtors and cash eehed . Loan capital Lifeinsurance funds funds . _. Outside shareholders interest ~ companies - Loans associated Deferred taxation Jo. ..:. overdrafts provisions Creditors taxation and provisions Bank . : Ah. ~ Group = 1978 > Year 1976 R000's : R000's . vee 258 a Spavpee 93 865 8 aad 3.056 . 0 , 205 261.734 - 712 070 207 938 a ey Ae 589 232 en 00a 141 991 - 704.616 -240 857 > 2, . 420 456.767 456.767 055 * 11018 2-220 9! 35 157 268 ~ Subsidiaries Corporation inin which the - has direct or indirectinterest 2 AT MARCH 31 1978 . in Africa Incorporated in South 2 Finance and iinvestmnent vestment a Investment Company Limited AfricanAfrican Eagle Property Holdings Limited Gold and Base Metal Holdings Limited African Loans and InvestmentsLimited =ordinary = preference Anglo American Insurance Holdings Limited Anglo American InvestmentInvestment Trust Limited -ordinary -ordinary -preference -preference Angloswazi Investments Limited Anseld Holdings Limited Limited .. Century Plaza Holdings Proprietary Limited Charybdis Investments Proprietary . Control Logic Holdings Limited Coriander Holdings Limited Courser Holdings Limited Proprietary Investments Corporation Egret Investments Limited ; Limited Electro Chemical Industries Limited Engelhard Enterprises of Institutional Investment Holdings Proprietary Institutional Investments Limited Limited Holdings Marjoram Limited ' Methwick Holdings Limited Issued share capital . Interest holding company in share capital Book value of company Direct Indirect *- . Shares . 31.3.78 . 31.12.76 : 3.78 R000's . .R000's 31.12.76 31.3.% 78 31.12.76 31.12.76 < 31.3-.307080 31.12.76 R000's .31.3.78 R000's - 31.12.76 - : R000's ost . 588-61222 100 100 58-612 222 222 58 -612 2 - 5.00 5.005.0 5.00 588-61222 eal 588-61222 ec PELE wen 588-61222 588-61222 eae 588-61222 c=} eS ae 33 312 10 | 100 129 129 117 057 we Own Pan Home African Proprietary Finance Proprietary Mineral Proprietary Limited | Proprietary ProvincialAcceptance Corporation Corporation Rand American Investments Limited Proprietary Limited Eagle Sorec Properties Proprietary Limited + Sorec Eagle Properties Rissik Street Proprietary Sorec Properties Brits ' Limited Proprietary Sorec Properties Proprietary Limited South African Waterkant Street Mines Selection Limited Limited : South African Townships Mining and Limited Thaton Limited Townstate Nominees Nominal amount . wus 764 849 ae Proprietary Limited Wanderers : Property Holdings P Western Ultra Deep Levels LimitedLimited Limited Life assurance ee, : Assurance Assurance Society Limited Guarantee Life Assurance Company Limited Institutional Life Brokers Proprietary | imited capital capital -31.3.78 31.12.76 R000's R000's Interest in share capital Direct . Indirect 31.3.78 31.12.76 % 31.3.78 31.12.76 % - Book value of holding company ~ Shares Loans . 31.3.78 31.12.76 31.3.78 12.76 R000's R000's 1 R000's Property administration oy 3 American PropertyServices Proprietary Limited . Proprietary Jacobs African Eagle Properties Proprietary Limited . African Life Centre Johannesburg Proprietary Limited African Life Pretoria Proprietary Limited Anmercosa Land and Estates Limited Barbara Investments Investments Proprietary Limited and S. Beherens Building Proprietary Limited Street Properties Proprietary : Limited Benparry Investments Proprietary Limited Limited * Street Properties Proprietary Limited Braamfontein Centre Proprietary Limited Bryanston Hobart Shopping Centre Proprietary Century Plaza Proprietary Limited Crescent Developments Proprietary N Delphin Investments Proprietary Limited ee Braamfontein Limited Proprietary Doris Court ProprietaryLimited Proprietary Eleventh Stage Investments Proprietary Esray Investments Proprietary Limited Buildings Proprietary Limited Limited Field North Proprietary Limited FirstStage Investments Investments Proprietary Limited Proprietary 124 Investments Proprietary LimitedPropietary Investiment Company Proprietary Gower Properties ProprietaryLimited : Griffin Properties Limited - Guarantee LifeProperties Southdale Proprietary Limited Propietary Highrise Holdings Proprietary Limited Ivanel Properties Proprietary Limited Limited 2 Ives Investments Proprietary Limited Limited Jasmin Enterprises ProprietaryLimted Jobacs Proprietary Limited +. fae Kenilworth Centre Proprietary Kersauer Properties( Proprietary ~ Killarney Centre Proprietary Limited Killarney Developments East Proprietary Limited Heights Kreza Proprietary Proprietary Limited Lanaria Properties Properties Proprietary Limited CELE PEPE PEPE E PERTI Za 2 Issued share capital Interest 31.3.78 31.12.76 31.12.76 31.3.7381.12.76 31.3.78 + R000's R000's v Direct in share capital - Indirect - 31.3.78 31.12.76 Book value of holding company -Shares Loans 3.78 31.12.76 31.3 12.76 R000's R000's R000's | R000's ' 2 Proprietary Limited LowerbergProperties Proprietary Limited LynbethStrand Street Properties Proprietary : Markort Properties Proprietary Limited MbulwaEstate Proprietary Limited Miron Investments Proprietary Limited Naoj Properties Proprietary Limited Ninth Stage Properties Town Proprietary " Ninth Stage Properties Johannesburg Proprietary Limited PatgefInvestments Proprietary Limited Proprietary P.H.B. InvestmentsInvestments Limited P.LG. Investments Proprietary Limited Properties Proprietary Limited Developments Proprietary Limited Sanso Properties Pretoria LimitedProprietary Sanso Properties Riebeeck Street Proprietary . Limited . Sorec Properties Sorec Properties Proprietary Limited Braamfontein Proprietary Proprietary Limited Limited Sorec Properties KrugersdorpProprietaryLimited Spicc Properties Port Elizabeth Proprietary Limited Limted Limited Stiemond Properties Properties ProprietaryLimited... Sydvil Properties Proprietary Limited Sydray Investments Proprietary Limited Talas Properties Proprietary Limited Talas Properties Primrose Proprietary Limited Properties Springs ( Proprietary Limited Company Vanderbijlpark Proprietary Limited . Five Three Treveson Properties 7 SevenJohannesburg Johan esburg Proprietary :. Properties Proprietary Limited ped Transport Investments Proprietary Limited Virawal Properties Proprietary Limited = Vogelux Proprietary Limited Voorwaarts Elendonis Beperk . Proprietary Limited Westander Westander Properties Proprietary Limited Westcom Properties Proprietary Limited- Zaaiwater Proprietary Proprietary Limited . we CO 8 EN ee Nib is ee ee ee Oe 2.500 2.50 ae ee eae ee en Beal as ee 200 200 20 ELA SUE] EEE EE EPP Maistre x J} PE PELE Titlefreehold rights holding holding Johannesburg Johanesburg Estate Company Proprietary Prospecting Prospecting Anglo American Nominal amount wee 56 : 60 | .224  ~ Issued share capital in Interest share capital . . 31.3.78 : 31.12.76 Direct 31.3.78 31.12.76 > Indirect 31.3.78 31.12.76 . % % % % R000's R000's Anglo American Prospecting Company South Limited Anglo American Prospecting Services Proprietary Limited 22.7 TEINTEL Anterra Minerals Proprietary Limited Dinal Investments Proprietary Limited Dunnock Investments Proprietary Limited : Jeannette Gold Mines Limited . : THE TEINTEL LE LA Roy Braakfontein Colliery Limited EB * . . . se = 8, ge 7839 oF we ls THE Warbler Investments Proprietary Limited - Manufacturing and marketing Foundrex Proprietary Limited G. W. Industrial and Chemical Kaolin Proprietary Limited ... Proprietary S.A. Oxides and Barytes Mills Wheel Weights Proprietary Limited Proprietary Zinchem Limited : 5 WPit rhe Ld brid Sands Clapham Chrome Proprietary Limited == G. W Base Industrial Minerals Proprietary G. W. Silica Proprietary Limited Hudson Mining Company Proprietary Limited Lager Mining Company Proprietary Limited Limted . Ocean Bentonite Company Proprietary Limited Oxides Proprietary LimitedPropietary bd African Hawk Eagle Holdings Andalusite Transvaal Proprietary Booted Eagle Holdings Limited Calliope Holdings Limited |, Ferrobar Holdings Limited Martial Eagle Holdings Limited viel . Taybard Holdings Limited Limestone Anthracitei Mining rights holding fens Langkrans Proprietary Limited : Deposits Proprietary Limited Syndicate Coal Coal Syndicate Proprietary Limited Book value of company Shares * Loans 31.3.78 31.12.76 31.3.78 31.12.76 R000's . R000's - R000's .: . PEAREVI Pibels? Prestin Proprietary Limited <. ~ Sorec Investments Proprietary Limited 4 Teastall Investments Limited Townsview Estates Limited + Appraised Limited Mining Holdings Private Blue Private Limited Skies Consolidated Mines Holdings Rhodesia Jamieson New Rhodesia Investments Linuited Limited Limited Rhodes Investments Limited 5 Varied Investiments Services American Corporation Limited Services Limited Life assurance Southampton Assurance ~ 000's | R5000's = by 20 : 20 1028- . a ." 5 000 100 2 2 te 20 1028 1028 5.000 _ : 22 22 ) Private Properties Salisbury Sanso Salisbury Limited see 7, Talas Properties of Rhodesia Private Limited Talas Properties of Rhodesia Salisbury Private Limited Neil Chrone New Middleridge LimitedLimited Rhochronie Limited Southridge Limited Valley Valley Exploration and Issued share capital Interest share capital . Book value of holding company ; - Direct 31.3.78 company 31.3.78 31.12.76 31.3.78 31.12.76 Indirect 31.12.76 2 31.3.78 . 31.3.78 31.12.76 . Shares 31.3.78 31.12.76 31.12.76 Q % R000's R000's * 31.12.76 : RS000's RS000's Los os Lighthouse Investments Limited Orlop Investments Limited 5 FF000's 1000 | 100 Angborne Investiments Investiments Ausrand | Proprietary Limited Lydenburg Holdings Limited Pionsjudged Investments Limited iA Issued share capital . on 31.3.78 31.12.76 : poet! K000's K000's Indirect Interest in share capital * Direct Indirect Book value of holding company Shares : Loans - . 31.3.78 31.12.76 % . 31.3.78 % : 31.12.76 | 31.3.78 31.12.76 - 31.3.78 -: % volt R000's . R000's wo R000's 31.12.76 R000's ol 2.500 * AS000's AS000's 563 BD5000's BDS000's Incorporated * in Italy . Marketing Anmercosa Sales Italia Italia S.P.A.S.P.A.S.P.A. Swaziland Industries Industries Proprietary Limited in Incorporated in Lesotho Managerial Managerial services Anglo American Lesotho Services Company Proprietary Proprietary Limited Incorporated in Botswana oe Issued share capital ao 3.1.3.78 31.12.76 * Lire 000's Lire 000's * Interest in Direct 31.3.78 31.12.76 share capital Indirect 31.12.76 31.3.78 % Book value of holding company Shares Loans 31.3.78 31.12.76 31.3.78 31.12.76 R000's R000's R000's R000's E000's MininMg ining Morupule Col iery Aggregate after tax profits and lossesattributable to Anglo Corporation American of subsidiaries South AfricaLimited fromits subsidiaries amount to : : investments ~ Schedule of general : _ MARCH 1978 ~! } i ^' } ' . e : aed an g . i | . i r - . fo 2 *o Listed " an Mining finance inveistment nvestment . Company Limited American Gold Anglo Investment > Limited Botswana R.S.T. Charter Consolidated Limited Company General Mining and Finance Corporation Limited . Gold Fields of Souili Africa Limitedse Company Company Johannesburg Consolidated Investment Limited Metals and Investment Corporation Limited : Minerals and Resources Corporation Limited Rand Selection Corporation Limited Investments Limited . Mines East Rand Goldand Uranium Company Limted * Grootvlei Proprietary Mines Limited Kinross Mines LimitedLimted Leslie Gold Mines Limited The South African Land & Exploration Deelkraal Gold Mining Company Limited East Driefontein Gold Mining Company Limited Elandsrand Gold Mining Company Limited -Elsburg Mining Company Limited- Hartebeestfontein Gold Mining Company Limited Limited Kloof GoldMining Company Limited Southval Holdings Limited Reefs Exploration and Mining Areas Gold Mining Company Limited 2.4 = Western Deep Levels Limited ZandpanGold Mining Company : Free State Geduld Mines Limited Limited 4 Free State Saaiplaas Gold Mining Company Limited Loraine Gold Mines Limited President Brand Gold Mining Company Limited President Steyn Gold Mining Company Limited St. Helena Gold Mining CompanyLimited Messina The Transvaal Rhodesian Nickel Shangani : Mining Corporation Limited Tanganyika Concessions Limited Company Limited Exploration and DevelopmentDevelopment Copper Investments Limited Platinum LydenburgLydenburg PlatinumLimited Rustenburg Holdings Limited Limited Group Group : *) Corporation Units held Market value ROOO'S 31.3.78 : 31.12.76 , 31.3.78 31.12.76 B . 489 581350581350581350 ' - = 494 498,905 - 2166 171 445291 445291 870 144 1.444 114 1155 37 555 32 591x 77.275 126 Units held s Market value . 13.78 13.78 31.12.76 R000's : 31.3.78 12.76 Dees 158 044 181.992 181.992 -5-214 035 1444 114 174 997 444 114 -144 950 131.962 ~~ os 260 155 To eT ee Ie 77 569 010 49 395 - 360822 360822 2009 10618 198 22 .7397 3.490 59 199 3.490 59.199 1214 20 1.166 84 1214 2.900 036 1176 347 989 300.000 300.000 50 702 5.370 588 600 145.974 os ae ee gd aac + 215 21.610 706 : se 7.250 324 000 484 582 41.807 47 123 : 1.260 145.974 145.974 145.974 26 145.974 5181-957 145.974 5181-957 oe 11-578 894 33.683 33.683 oe 806 153 105 269 892 2. 496 15 158 158 000 * 323 268 54 628 380 992 - 100 077 316 238 377 6794 359 50 Fo 250 983 800 614 573 311556 967 100 984 +: 926 812078 812078 2876-224 389 720 25 565 7.487 343 13.781 1264 1264 1.309 504 .85 392 1.088 655 23 .19 838 : 772 651 987 484 333 33 805 33 805 889 4 15 156 7 250 So 2346 356 98 2 508.723 _ 565 246 20.133 854 663 1436 366 7174 7 18 792 438 045 40 803 784 537 -4615 .2794 920 3.804 98 98 7447 : ve 2 505 089 54,000 54,000 1614780 1614780 649 112 : 112 372 16 100 849 10033 226 339 3721 6.465 293 366 7.366 33 805 1637.931 191815 me 226.650 4.546 .479 894 74 431 2.978 2005 180.333 173 26 233 2005 592 ne 919 1081 826 620 326 267 7577 = 518 6.102 285 170 14.157 109 258 135 593 060 234 a 342-072 593.060 2.998 162 1466933 8187.258 2.600.533 2.600.533 1 498 114 220.410 996 233 Days 000 649.805 649.805 16.001 16.001 980 941 142 9191 49192 1 7 5 535 1014 Banut 1.008 2116 150 32370 325 045 370 er 5284-97000 8.389 : 839 42 3.703 252 7 889.350 42-839 402 : : : 1,265 oo = ~ 1974 305 _ = = 7 6467 8556 =) : mee ee 4.974 305 8.556 a : i. . ea . " fe : for. 6 . . ; Coal Corporation Anglo American Coal Apex Mines LimitedColieries Limited Natal Ammonium Collieries Natal Anthracite Colliery Limited > Natal Coal Exploration Company Trans Coal Corporation Limited Vierfontein Colliery Limited ....... Vryheid Coronation Limited _ Witbank Colliery Limited 7 Shares 13.5 1979/82 notes : Zuinguin Natal Collieries Limited . . . wee wee . . Units held | 31.3.78 | - Group 2 Market value R000's 3102.76 31.3.73 31.12.76 1 008 11 408 218 325 041 96.970 86485 1 687 778 = 644 .10 800 - 1427 691 1.491 301 pF 660 7810 389 -- 305 - 604 626 305 604 | 2020 . -162 3312 30.000 30.000 R43 200 7673 875 30.000 30.000 200 457 583 -.: 1145 901 55 670 27 90 | 6.708 418 138 1388 1180 4.850 oe : 327 OP oe 1-190 Corporation Units held Market value . R000's 31.3.78 31.12.76 31.3.78 31.12.76 231736 1637 Saal Sed - _ = > : 231736 TOF _ _ -_ 1985 1970 z 15 _ - - _ 1761 1 761 _ - _ > _ _- . ~ Ate Boy _ _ = > _ ' i? General finance & f First Union General Investment Investment Trust ordinary . - preference New Central Witwatersrand . commercial Industrial and AECI Limited ' . : Anglo American Industrial Barlowy Rand LimitedLimited Boumat Limited 2. Chemical Holdings Limited ordinary unsecured notes Cullinan Holdings Limited ies Investments Vanadium ',Edgars Consolidated Investments Gallo Africa Limited Vandium Highveld Steel Limited Corporation Limited Huletts Corporation Limited Company .-.2 a Johnson Matthey Company Limited LTA Limited weve McCarthy Group Limited Limited Pomatex .. Limited Russell Holdings : . ordinary preference & * Lloyds of South Africa Limited Television and Electrical Holdings The TongaatGroup Limited ..... _- Tiger Oats and National Milling Company Africa The Union SteelCorporation of South 4 Limited Vereeniging Refractories Limited . LHS 4462 Lo Al 3.874 . ind . 874 6918-774 _ 874 221 100 441 800 190 928 | 588 . _ = | 1 ~ ue . ke : 944 187 198 913 532 087 944 944 524 2087 1.898 12411030 12411030 : 494 1.529 1529 13.000 8 620 420 | 38.900 ; : 079 705 R770 675 287-156 .30 861 Loe , ah 212 65 1674 1674 R581 728 ." 886 544.277 107 918 R126 544 ow . : 107 918 . R126 238 109 7557 wt 157 126 2115 000 > 2,100 002 =), | 2855 2855 Poe Se ee 11 11 = 470.155299 470.155299 145 221 290 299 145 299.145 299.145 2 875 027'. 1008 851 000 529 008 550 667 813 1987 .. . 5'551 18'794 . 6578 6 578 713 fib. 667 * .3.920 081 6469 653 081 653 081 633 3.158 424 500 100 000 757 500 se 990 637 100 oe 728-721 * 728 Qo Sis _ + 2 11 210 200 000 os 205 66 142 me 932 362 626 683 1.585 940 182.225 200 491 2.557050 841 6393 : 3 86.400 1-764 355.494 43 200 139 216 | 069 146 104 800 0 ee OT ae ce : DUE BT Anglo American Properties Properties 2 -ordinary Ue --preference Saree Limited BarclaysBarclays National Bank Limited |. Nedbank and Syfreis - UAL Holdings Rhodesian Acceptances Holdings . Limited Standard Bank Investment Investment Corporation Limited Sundry . . stock loan City Johannesburg 6,5 % 1997 stock Rand Mines Limited : Rhodesminori%a 1978/81 stock Other minor holdings Total market value 790A 8441 4.869 483 549 751 425 880 16 384 664 = * 7 314 876 7028 =a 62016 62016 ; = 745 449 755 7 1499 722 2.935.764 | 958 0 3374 1381 000 250 000 68000 > 620 - 488 800 039 6.226 176 753 7490 .5.343 2369 551 = 2.094 727 . _ need . oe _ ope 000 : : R187 500 R592 500 _ aan 1043 13 R187 500 R407 E100 . | = 116 391 536 101 257 ~ 82 373 1996 731 934 221 wos R187 500 ao _ Now a subsidiary of the Corporation Unlisted Units held Group Y > Directors valuation R000's 31.3.78 31.12.76 31.3.78 31.12.76 . Mining ffinanceinance and investment a ~ Anglo American Corporation of Canada Limited . . . 3051 Corporation Anglo American Rhodesia Australian Anglo Am^ricanLimited Limited . * BCL LimitedAnglo preference ... Company Investments LimitedBeperk . Hollardstraat Beleggings Beperk . Johannesburg Consolidated Investment Investment - preference ele Osprey Investments Limited Limited Overseas and Rhodesian Investment Peregrine Investments Limited Company Limited 2 854 400 ~ 250 . wae _ .980 000 tee . we : Swan Investments Limited . . Sward Investments Limited . Western Ultra Deep Levels Limited 5 esas 051 290 | 830 3 800 000 - . 947 656 -632 671 5 000 000 040 175 500 000 4 040 175 12 693 315 744 500 770 .. 255 . . Corporation Units held Directors valuation R000's 31.3.78 31.12.76 31.3.78 31.12.76 _ _ 990 7550 7550 a 099 500 _ . 000 Diamonds Abrasive Grit Sales Limited Cymberline Proprietary Limited - variable rate cumulative - preference #2... The Diamond Purchasing and Trading Trading Company Proprietary , Limited - Trading The Diamond Company Proprietary Limited Industrial Distributors 1946 Proprietary Limited 2) ordinary yo... : aan = participating preference : Industrial Grit Distributors Sharon vee eine . 39.000 39.000 756 t 500 000 : 330.000 150,000 150,000 . : s+ 000 _ Copper and other mining ClevelandCleveland Potash . Limited ordinary = preference . noe - oa . . -10 -10 loan stock .: . Camsberg Zinc Corporation Limited : Messina Rhodesia Investments Limited - Rhodesian Alloys LimitedD'Anglade s Societe de Miniere D'Anglade . Swaziland Iron Ore Development Company Limited TsumebTsumeb Corporation Limited 6 : me . Blinkpan Koolmyne Beperk . ; : Natal Coal Syndicate Proprietary General finance ue . - Achem Investments Limited . tine. Astron Investments Limited * Compagnie Holding Franco Africaine Coriander Holdings Limited Courser Holdings Limited Electro Chemical Industries Limited Engelliard Enterprises of Southern Africa Africa Limited . Epoch Investments Limited oe : ; a * 920 oo eo) 875 000 555 000 000 000 334 _ : on ne : 458,583 305-722 1 2.266 663 151 wo . 000 . 1176 we 95 000 S Jn 000 eo ~ 700 000 000 1379 : . mo fee : Be oe . . . . ; ; . . .25 768 : : . wo : . . 250 000 000 = 250 000 _ . | 000 ; B'.non voilig Mean Investments Limited .. > Nave Investments Limited Pamelia Trawlers Limited :. Park Holdings Limited .. < Pleach Investments Limited Smade Holdings Proprietary Limited Grand Societe Financiere Louis Zinc Products Limited . : : bees 250 250 | ~ . 100 100 100 2 250 _ _ 500 5.986 . an : ein 4 199 370 . . 223 000 260 - 372 ao . a foe ee : 5 "+ 1 1-81 227 1111111-881 50 1111111-881 1111111-881 . 362 11248 : 150 eon . 500 - oo . 496 2000 _ 500 - _ 217 553 " Now a subsidiary of the Corporation i i H Industrial and commercial : > Anmersales A.G. : Bentworth Trust Europa Cardium Holdings Limited .. . J.L. Clark Company Limited .. Clay Products Limited 6. S 0. - Computer Sciences Proprietary Limited Metallurgical . Consolidated -+ -shares -shares Industries Limited -convertible -convertible loan stock :. < vv Consolidated Share Registrars Limited : Conway Johnson Limited C.T. Bowring and Associates Holdings South Africa Limited Units held Group Directors valuation R000's R000's 31.3.78 | 31.12.76 31.3.78 31.12.76 152 498 _~ 5.000 5.000 114 282 500 826 334 40 333 3 386 76 187 500 = '. 1875 000 R576 922 476 = 19 370 370 98 400 65 600 25.000 25.000 2 25.000 2 Corporation Units held DirectoRrOOsDv'asluation 31.3.781 31.3.781 31.12.76 31.3.78 31,12.76 10326 575 76 31 - preference - : Eastern Transvaal Timber Proprietary Limited |. - 5.A. Limited ) Hall Longmore and Company Proprietary Limited ~ Illings Proprietary Limited preference 2... International Pipe and Steel Investments 5.A. Proprietary Limited Kiln Products Limited .. - McCarthy Main Holdings Limited - + Mainstraat Beleggings 1965 Eiendoms Beperk Middelburg Steel and Alloys Proprietary Limited | Mimbula Fitula Holdings LimitedPropietary Mondi Paper Company Limited = . preference RFF RFF Limited : -ordinary Proprietary -preference Shaft Sinkers Limited Sigma Motor Corporation Limited Proprietary SoetveldeFarms Limited WagoWagonn Union Carriage and Company . Mineral Proprietary Limited Industrial Zinchem and : Limited Company Proprietary Limited Resources Limited 37281 ; 750 147 17.000 281 1 7 750 98 16819 4019 694 746 764 274 99 562 500 1000 500 - 595 . 000 365.000 636 . 000 -: 941 10 000 .8 959.958 10 000 000 718 464 : 005 000 670 - 1-709 776 1 470 170 670 162 2 500 546,907 1157 000 192 590 McCarthy Limited Amaprop McCarthy Investments wav Limited - ~ Anglo American O.F.S. Housing Company Limited Anglo American Properties Limited - deferred . Carlton Centre LimitedLimited Creative Homes Limited Denn^'hofCourt Proprietary Limited Kenilworth Centre Proprietary Limited , Main Place Holdings Limited Marina Gama Limited >: 294 196 ' 637.500 637-500 3339 2.520 386 839 3339 +14 183 3339 3339 545 840 505 352 we 40 = ! 559 553 368 5.512 3.675 17.927 13.120 12 279 820 99 562 -730 000 610 983 859 1.038 859 1.038 859 111.192 111.192 111 192 60 785 196 615 196 615-131 865 992 000 368 FL553 - 368 2021 293 ay Banking Aspella Investments LimitedCompany Limited Bahamas International Trust Company - votingvoting = voting Developnient * Central Reserves Proprietary Commonwealth Developnient Proprietary Limited Finance Company ~ Industrial Finance Corporation of South Africa Limited - National Finance Corporation of South Africa Limited . . The Discount House of South Africa ordinaryprefrence Limited = preference 6558 474 6534 5'454 > coe 350 50 tea 124 1876 | 124 1.876 124 876 124 1.876 50 525 Lyte 437 .> . 000 50 241 502 000 50 425 000 ' 000 150 050 425.000 425.000 480 000 81 81 + 500 108-750 217 217.500 217.500 108 750 Sundry Ansa Petroleum Beperk i2.......0. Edesa Soci^'t^A'nonyme Holding A.G. -Lucas Block Minerals Limited Other minor holdings 2.2.0.6... Total directors valuation 1802 1802 200 100 . 201 800 100 3.479 272 296 059 ~ 800 100 366 1.040 Now a subsidiary ofthe Corporation Statistics " from the consolidated financial statements FOR THE TEN YEARS TO1978 : * ie ie of Number -<' issued | |.) Issued ordinary ordinary ~ shares capital and . reserves . > ..- 4. Investments ; = Book value - - Market value Equity . earning : after . taxation Equity carnings per share2 | Dividend per ordinary_ share2 a 2 Total ordinary .' dividend : ROOO's 400 |. 245.536 | R000's -262-299 R000's | 355 ~ R000's 32728 - cents 25,2 cents 4 14 , R000's ; ' 18175 ||, 400 | 261.82601.8606 . 1174 o} 1384 | 36224 ' 27,9 16 : 129.820 400 ; 279 727 _ 3354 610 | 38692 fo |. 29,8 16 | 20771 fe 2077 329 400 300 805 ~ 858,200 858,200 |. 322 658 91889 300 | 434 }946 |g 378 262 094 40970 - 31,5 age | 22069 379 fey 34,9 P19 - 24674 353 730 ] 468 | 1231 359 57.954 44,6 44,6 | 24 31176 397-215 |ote. 710 | 1276 603 57,4 460 fo 29.0. do 38.100 447.803 447.803 | os 518.825 | 1.233 5 84428 1 33 Os 43 449 469.692 525.688 S fe 525.688 * 102-280 102-280 " ; 858 3195 ops 835 575" =| 2.269 85.992 | 1950366 65,3 | "> 89,96 eR unlisted value ; it was changedtoMarch31commencing March 31 1978 on June 13 1969 of R1 shares into cent shares for purposes of comparison ' investments book investments investments at K and outside shareholders interest in surplus of market value listed investments comparable AngloRand earnings with previousyears owing to the merger of Selection Corporation Limited and the inclusion companiescompanies H virtue ofMtahrecmherger beca;me subsidiaries of American Corporation Equity are are for the 15 months companies January 1977to 31 1978 : . | ache oe ee er i f Se Shet Lenes ete pt ee tea ensoe tee woe oe GY Overleaf The restoration of mined areas at the Group's opencast coal operations is a high priority At Amcoal's Arnot mine near Middelburg in the Transvaal the dragline silhouetted in the background disturbs surface land at rate of six hectares a month creating huge spoil heaps which are contoured at the same rate A comprehensive programme is being followed to rehabilitate the soil in these contoured areas and to introduce pasturage Sar G Interests of the Group The Anglo American Corporation Group and its asociates associates have direct and indirect interests in a wide range of financial mining industrial prospecting insurance and other companies Particulars are given in section of those companies in which the Group associates = hold significant interests Principal finance and investment companies 79 : Principal operating companies Gold and uranium 84 Diamonds 88 Coal 89 Other mining 90 Oil and gas 93 Industry and commerce 95 Property 100 Insurance banking and general investment 100 Prospecting 102 Service 102 Een x 48 77 Principal finance and investment companies In this section of the report the Anglo American Corporation AAC Group equity interest reflects reflects the interest of the Corporation and its subsidiaries in each company In many cases additional interests are held by finance and investment companies associated with the AAC Group Dy Administered within the Anglo American Corporation Group Anglo American Coal Corporation Limited Amcoal De Beers and Charter Consolidated groups These include both direct and indirect investments in copper zinc gold silver cadmium fertilizers agricultural chemicals crude oil and natural gas production and prospecting operations Year ended December 31 1977 1977 1976 Anglo American Gold Investment Company Limited Amgold ve AAC Group equity interest 47,83 per cent An investment company with major shareholdings in African gold and uranium mining companies and in gold mining and exploration in Australia AAC Group equity interest 48,56 cent 5000's 5000's Amcoal holds the major coal investments of the Anglo American Corporation Group It is one of the largest coal mining groups in the world with investments in the Issued capital stock 545 of 929 shares consiting no par ' shares and 3 931 931 Year ended December 1977 1977 1976 ROOD'S R000's 2 South African coal industry through its 12 principal subsidiary companies involved in coal mining the marketing marketing of coal on both the domestic and export markets and related activities A 51 per cent interest is a also held in Vereeniging Refractories Limited major pro- ducer of refractories and allied products in South Africa Amicoal also owns property mineral and coal rightsin the Transvaal and Orange Free State and participates in the coal prospecting programme of the Anglo American Corporation Group through its wholly subsidiary Amcoal Exploration and Finance Limited Year ended December 1977 B shares 609 Total shareholders equity Investments Listed - gy Book value Market value Equity value Market valuie Unlisted Book value Equity value 085 445 101 085 133231 _ . 660 372 255 2 896 9 831 83 276 387 807 662 2 1327 1327 Issued capital 952 012 ordinary shares of RI each Share premium and reserves Investments Listed - At cost less ai^-ounts written off Market value Unlisted - At cost less amounts written off . . 952 146.709 952 141423 184 760811 147 839 340 340 1977 1976 Earnings before extraordinary Directors valuation * 5 289 4455 R000's ROOU'S items 1976 loss 3913 5.934 Th ROOU'S Issued capital Loans 4955 836 23 491 438 shares of 50 cents Earnings after extraordinary Equity earnings 507 366 items 1976 loss 771 721 each || 746 746 Dividends paid 221 514 Dividends paid 4319 3.972 Reserves 845 846 The shareholdings of Amgold and its subsidiary = company , Long and medium loans 59317 46 776 All amounts are expressed in Canadian currency company Orange Free State Investment Trust Limited 2 Fixed mining and net township At December 31 1977 Amcan's principal investments at December 31 1977 were assels 259 997 were as follows Per Investments Listed Book value 3 Market value Unlisted- UnlistedBook value Directors valuation - Equity earnings Dividends paid 860 1463 3811 4.391 295 095 G 860 488 4582 5138 188 396 Direct percentage Ambay Services Limited Francana Oil & Gas Ltd ownership 50,00 28,29 Smelting Hudson Bay Mining and Lytton Minerals Limited Co. Limited Tombill Mines Limited 36,60 33,94 50.66 Whitehorse Copper Mines Limited Gold producing Blyvooruitzicht Gold Mining Company Limited , Buffelsfontein Gold Mining oat Company Limited Deelkraal Gold Mining Company Limited Shares held 1.635.000 1.635.000 218 5 468 690 | centage interest 6.81 20,17 8.68 As_restated As_restated . provision after taking taking into account_tax_equalisation account_tax_equalisation account_tax_equalisation venture - 33,33 Doornfontein Gold Mining Company Limited 701 888 7,14 Details of Amcoal's principal interests on appear page 89 of this report Anglo American Corporation Rhodesia Limited Amrho , East Driefontein Gold Mining Company LimitedEast Rand Gold and Uranium 6.063 G 11,12 Anglo American Corporation do Brasil Limitada Ambras as ociates Anglo American Corporation and effective 60 per cent interest in Ambras business other than gold and diamonds and a 68 per cent interest in its gold business the remaining interests in these fields being split as to eighths Minerals and Resources Corporation Limitedand eighths Charter Con* solidated Limited Ambras was formed in 1973 to hold the Group's interests in Brazil with the purposes of seeking investments particularly in mining prospecting for and developing mineral deposits and providing to associated companies investing in or trading with Brazil In 1975 the company acquired a 49 per cent interest in Minera^^oMorro which owns a group of producing gold mines in the state of Minas Gerais its associate Unigen Geologia e investigation investigation Bahia and is continuing with its depth of the Jacobina gold prospect in the State of its widespread prospecting programme throughout Brazil AAC Group equity interest 16,60 per cent other Amrho in conjunction with certain Group companies holds the Rhodesian Rhodesian interests Anglo American Corporation Corporation Limited and Charter Consolidated Limited groups and has widely diversified portfolio of Rhodesian investments Its major investments include coal nickel and copper mining iron citrus chrome and allied engineering industries general agriculture forestry and timber processing cement flour milling rolling stock hire property merchant and investment finance In addition Amirho has a substantial participation in the Corsi poration's prospecting programme in Rhodesia Year ended June 30 1977 1977 1976 Issued Issued capital 1 28 354 606 shares of each Share premium and reserves Unsecured loans 5000's 355 195 400 5000's 7089 555 4.800 Investments Listed Company Limited Elandsrand Gold Mining Company Limited 000 11 425 366 Elsburg Gold Mining Company Limited 1351 Free State Geduld Mines Limited 112 Free State Saaiplaas Gold Mining Company Limited Harmony Gold Mining Company Limited 5.403 667 4 737.000 Hartebeestfontein Gold Mining Company Limited ]737-700 = Company Kinross Mines Limited Company Kloof Gold Mining Company Limited ff 102 600 413 467 Loraine Gold Mines Limited 297 000 President Brand Gold Mining Company Limited President Steyn Gold Mining Company Limited St. Helena Gold Mines Limited 2 808 000 3 004 500 1885 000 Vaal Reefs Exploration and Mining Company Limited 3 490 20,00 22.70 4,47 20,24 19,23 2,74 15,52 0,57 : 7,98 14,03 20,00 20,63 19.58 16.35 Anglo American Corporation of Canada Limited Amcan AAC Group equity interest 29,5 cent Book value Market value Unlisteadt book value Equity earnings 19 567 425 772 537 17735 17735 37.970 33.779 153 Venterspost Gold Mining Company Limited Welkom Gold Mining Company Limited 33.500 33.500 2 300 000 0,66 18,78 Amean was established to consolidate the major part of Dividends paid 1418 992 West Driefontein Gold Mining i the Canadian assets of the American Corporation All amounts are expressed in Rhodesian currency Company Limited 000 134 14.20 } oa) 79 One of the two largest and heaviest loads ever to be transported by road in South Africa a 57 metre 306 ton steel column en route between eel the new Natal port of Richards Bay Richards and the Sasol H project at Secunda Secunda em ie in the eastern Transvaal Spearheaded by Freight Services Services ProjectsProjects various companies in the Freight Services group in which Amic has an effective 40 per cent interest are responsible for handling this and other Sasol 11 equipmefrnotm the ports of discharge to delivery at the Secunda construction site Shares held interest Investments 1977 R000's 1976 RO00's Shares held Per- centage interest Western Areas Gold Mining Company Limited Western Deep Levels Limited Western Holdings Limited Winkelhaak Mines Limited Zandpan Gold Limited Mining Company 1016 500 3 309 290 569 460 10.000 10.000 1718 250 2.52 13,24 20,94 0.08 13.20 Listed- ListedBook value Market value Unlisted- Unlisted- Book value 50 324 65 152 47315 314 592 719 56 080 45 892 53 578 42.949 Mondi Paper Company Limited Sappi Limited Property Isipingo Property Investments Limited Food and produce 15 320 300 000 500 39.79 1,05 25.00 Financial Ellaton Gold Mining Company Limited 59 000 7,49 Dividends paid 18 804 Principal wholly subsidiary companies at December 31 1977 17 370 African Products Limited OKK Foods Limited SoetveldeFarms Limited Limited 323 500 250 000 648 500 8,76 50.00 21,62 2 Gold Fields of South Africa Boart International Limited The Tongaat Group Limited 031 250 6.32 Limited Southvaal Holdings Limited Western Ultra Deep Levels Limited 1776 733 461 202 434 400 10,90 13,31 28,96 ' Bruynzeel Plywoods Limited equity capital only Orange Free State Land and Estate Company- Proprietary Limited Textiles Proprietary Limited Romatex Limited 273 217 751 900 37,45 37,45 2,87 Witwatersrand Deep Limited 35 227 2,18 S.A. Forest Investments Limited equity capital only Motor and transport am Property Carlton Centre Limited Scaw Metals Limited . McCarthy Group Limited McCarthy Holdings Limited 2059 940 500 12,13 25,00 ~ ordinary -81 -81 per cent fully paid first mortgage convertible debentures 1979/96 000 1 000 000 * 0.18 The principal investments of the Amic group at December 31 1977 were Shares Percentage Sigma Motor Corporation Proprietary Limited 7013 330 38,05 Anglo American Investment Trust Limited Prospecting Anglo American Corporation B do Brasil Limitada A and quotas Australian Anglo American Searches Limited . 17217414 020 20,00 20,00 Building and allied industries LTA Limited Freight and travel travel Freight Services Holdings held interest 674 716 37,98 Anamint AAC Group equityinterest 52.16 per cent An investment company with shareholdings in Beers Consolidated Mines trading companies Limited i and certain diamond Boskop Areas West Wits Limited Goldridge Gold Mining Company 7 200 2,40 Limited directly and through Redbury Holdings Limited 026 266 40,34 Year ended March 1978 1978 1977 Limited 200 12.00 Iron steel engineering and R000's R000's Warbler Investments Proprietary Limited Other 800 20,00 related industries Consolidated Metallurgical Industries Limited 250 10,00 Issued capital ordinary shares of 50c each 10 000 000 cumlative 5.000 5.000 Anglo De Beers Forest Services Lesotho Limited Cape Verde Proprietary Limited City of Welkom local registered stock 1995 11 per cent Jeannette Gold Mines Limited , ordinary - RI convertible notes Meadow Investments Limited Mulga Mines Proprietary Limited The Afrikander Lease Limited The South African Land & Exploration Company Limited Unisel Gold Mines Limited 20 per cent interest in gold activities 2 10 R500 1963 1963 002 972 000 100 1000 028 298 . 1058 496 882 500 Anglo American Industrial Corporation Limited Amic Amic AAC Group equity interest 46,2 per cent 28,57 110.00 25.04 22,73 20,00 15,28 16,04 3.15 Hall Longmore and Company Proprietary Limited Highveld Steel and Vanadium Corporation Limited International Pipe and Steel Investments S.A. Proprietary Limited C shares J.L. Clark and Company Limited 1965 Mainstraat Beleggings Beleggings Eiendoms Beperk O Middelburg Steel and Alloys Proprietary Limited Lloyds Stewarts & Limited of SouthAfrica Union Carriage and Wagon Company Limited The Union Steel Corporation of South Africa Limited Vereeniging Refractories Limited Zinchem arid Industrial Mineral 61 493 050 757 426 180 001 228 590 907 864 649 189 492 3 800 000 786 000 1,79 8.11 six cent cumulative preference shares - 500 000 of R2 each Distributable reserves 5 000 5,000 53-228 894 5,33 20,00 12,50 13,10 15,72 At cost Market value /* Unlisted - At cost Directors valuation Equity earnings Dividends paid- paid- ordinary Anamint's investments at follows March Abrasive Grit Sales Limited A shares 46411 520 123 46411 398 345 656 92343 64.634 60.000 60.000 6960 47943 47943 44 123 41000 31 1978 were as Shares held Petcentage interest 600 12.00 Amic was formed to consolidate the industrial holdings of the Anglo American Corporation Group Amic's subsidiaries operate in the fields of mining tools equipment and contracting services engineering forestry saw milling Amic also holds a large portfolio of investments undertakings complementary to those of its subsidiaries and in industries involved in paper and packaging freight and travel chemicals construction food and produce motors and transport and textiles Year ended December 31 1977 1977 1976 Issued capital 26 861 947 ordinary shares of R1 each R000's R000's 862 845 Resources Proprietary Limited Industrial finance Barlow Rand Limited De Beers Industrial Corporation Limited Mining tools equipment and contracting services Mimbula Fitula Holdings Limited Shaft Sinkers Proprietary Limited . Smith Boart Proprietary Limited Timber and paper 200 000 1177 3 625 000 750.000 750.000 300.000 300.000 750 000 19.30 1,16 26,36 18,03 5,00 50,00 Anglo American Industrial Corporation Limited De Beers Consolidated Mines Limited deferred shares The Diamond Purchasing and TLriamditiendg Company Proprietary ) The Diamond Trading Company Proprietary Limited 7, Industrial Distributors 1946 Limited -ordinary -ordinary shares five cen cumulative participating preference shares 590 625 94 862 330 461 756 500 000 330000 330000 150 000 2.20 26,37 18,47 50,00 13,20 30.00 Share premium and reserves Long and medium loans 002 147 050 179 Cardium Holdings Limited includes 636 014014 indirect 334 33.34 Industrial Grit Distributors Shannon Limited 28.000 15,55 e Anglo American Properties Limited Amaprop 1977 1976 AAC Group equity interest 48,9 per cent Camaprop is a property finance company with a diversified spread of investments both as to type and Share premium and reserves Loans 5000's 687 5.486 5000's 250 847 12 206 parking geographical location It has interests in centre office shopping complexes hotels medical suites and residential and holiday apartment blocks nvestments I Listed Book cust 228 356 229 555 township- addition it has land holdings township- developments in the Transvaal Natal and the Cape Market value Unlisted less amounts 313.291 363 203 Province Year ended March 31 1978 197 1977 written off Loans less amounis written off Equity earnings 879 81 969 10934= 425 720 6944 R000's RO00's Transfers from reserves net 714 1595 Issued capital ordinary shares - 20 810 608 of 50 cents each 10405 10404 10404 Dividends paid 829 350 Issued capital is expressed in Bermudian currency and other amounts in United States currency deferred ordinary shares 10 668 000 of 50 cents each seven cent cumulative 334 334 Consisted of 31 668 of BD each ordinary shares 1,40 A and 910 618 ordinary shares of BDS1,40 BDS1,40 each The A ordinary shares were converted to ordinary shares on convertible redeemable October 16 1976 preference shares - 31 422 783 50 50 cents each Share premium and reserves Long loans Fixed assets - 571 12.490 47 126 87 678 713 12462 12462 522 : 87.998 Township properties and debtors 809 1942 Loss attributable to ordinary shareholders 655 206 Accumulated loss 716 03-1 Details of Amaprop's interests mity be found on page 100 of this report ae its The major investments of Minorco and June 30 1977 were subsidiaries at . Engelhard Minerals & Chemicals Corporation Inspiration Consolidated Copper Company Trend International Limited Company7 Zambia Copper Investments Limited interest 29.00 14.96 43,15 49,98 Zambia Copper Investments Limited ZC1 AAC Group equity interest 0.80 cent ZCL domiciled in Bermuda a finance and investment Australian Anglo American Limited AAC Group equity interest 36,7 per cent The purpose of this company is to establish mining activities in Australia and neighbouring regions now primarily through its exploration effort Active programmes are being conducted throughout Australia in Fiji and in New Zealand Through its subsidiary Mulga Mines Proprietary Limited Australian Anglo American has a beneficial interest of approximately 78 per cent in the Blue Spec Gold and Antimony Mine in Western Australia which has incurred significant working losses since production commenced during 1976. Although the mine had surplus achieved a small operating surplusin the current period za decision to cease operations was made early in 1978 and realisation of the mine's is virtually complete Australian Anglo American administers Australian American Prospecting Limited Australian Anglo American Searches Limited and Australian Anglo American Ventures Limited company with substantial investments the copper and industries Minorco in which the Anglo American Corporation Group lias a 40 per cent interest holds 49.98per cent of the equity of ZCI 7 Year ended June 30 1977 . Tos SU00's 1976 5000's restated Issued capital ordinary shares 122 559 866 of 24 | Bermudian cents each deferred shares Cot oe 414 414 50 000 of 24 Bermudian cents each Share premium and reserves reserves - Market value 34 364 985 Year ended June 30 1977 Issued capital AS 18 000 000 in shares 50 cents each at Unlisted cost Loss 1976 profit Dividends paid 173 403 ~ ~ 5 779 _ Minerals and Resources CorporationCorporation Limited Minorco extraordinaryitems Zambia Kwacha devaluation 3 957 000 Provision against investment iii and loans AAC Group equity interest 39,91 per cent to Botswana RST - Limited 20 000 000 Minorco domiciled in Bermuda is a finance and investment company with substantial investments in expressed Issued capital is in Bermudian currency and all other amounts in United States currency metals international commodity trading industry copper = - The major investments of ZCI and its subsidiaries at mining base metals and oil exploration and production June 30 1977 were Nchanga Consolidated Copper Mines Year ended June 30 1977 Limited 49,00 per cent interest Roan Consolidated 1977 1976 Mines Limited 12.25 per cent interest and Botswana RST se 5000's S000's Limited 11,75 cent interest Issued capital ordinary shares 73 579 517 of BD 1,40 each 103 011 103 011 deferred shares 8 572 of BDS1.40 each -12 12 Charter Consolidated Limited AAC Group equity interest 35.82 per cent Charter is a United Kingdom mining finance company operating internationally with interests in gold diamonds copper tin and wolfram platinum potash and other minerals and important industrial interests These include a majority holding in Cape Industries Limited owned subsidiaries Elastic Rail Spike Company Limited and Heatrae Holdings Limited K. and M. Refrigeration Limited miami^>factofurbaerr cooling equipment which was acquired in August 1977 Based on the market value of listed investments and the directors valuation unijsted investments the net asset value at March 1978 amounted to 287 604 000 1977 C273 544 000 The following is an indication of the geographical location of its assets and revenue taking into account its direct interests pos ible possible , its major indirect interests and also where * ASSCIS 000's United Kingdom Rest of Europe North and . South America 98 899 30929 55 043 South Africa 136 904 Zambia Rest of Africa Percentage of assets 27,0 Percentage of revenue 100,0 1977 000's 104 837 397 shares of 25p each fully paid and 286 500 shares of 25p cach Ip paid up Share premiumi aind reserves term indebtedness and 26212 181 150 202 190519 58064 511 Investments Listed- Listed- At cost _ ~ Market value 133 943 478 519 196412 " Unlisted At cost 67357450 67357450 67357450 Directors valuation 380 -56 380 Equity earnings 4 435 277 Dividends paid 703 7.865 7.865 * Restated to reflect change in basis of accounting for deferred taxation All are amounts expressed in United Kingdom currency At March 31 1978 Charter's principal direct and indirect investments were as follows Percentage held . Anglo American Corporation do Brasil Limitada Anglo American Corporation of Canada Limited Anglo American Corporation ofSouth Africa Limited 12,0 24,8 5.9 Limited Anglo American Investment Trust Limited Australian Anglo American Limited Beralt Tin and Wolfram : . Botswana RST Limited 10,0 15.0 48.2 4.5 Cape Industries Limited 66,9 ; Cleveland Potash Limited Malaysia Mining 37,5 28,6 Minerals and Resources Corporation Limited 20,0 Rustenburg Platinum Holdings Limited Selection Trust Limited Soci^'t^' Mini^re de Fungurume Union Corporation Limited Percentage held De Beers Consolidated Mines Limited De Beers AAC Group equity interest 30,37 per cem The principal activities and interests of De Beers are the produce mining of natural diamonds the manufacune of synthetic diamond the marketing of diamonds produced by the group and by other producers and a portfolio of investments outside the diamond industry Details of the group's operations may be found on pages this report Year ended December 1977 o ey 88 and 89 of 19771977 1976 capital Issued capital 40 per cent cumulative preference R5 each less 481- of shares 000 shares held by subsidiary companies eight per cent cumulative second preference shares 2866 929 af R each ROOO's RODO'S 3.978 2867 3978 2.867 deferred shares 359 789 042 : of live cents each 17 989 17989 Reserves 401945 067 term liabilities 886 41443 Minority interests 070 107 3001 539 477 Diamond mining and trading assets Diamonds on hand Mining companies < 170,527 824 962 181 783 26 690 200 a Book value Market value Unlisted fe Book value valuation |G Directors valuation Long loans Net current assets Other 325 489 088 612446 342308 342308 540 ) 993 130 01 153 218 425 77 846 206 940 100 803 75 285 1539 477 Diamond account Interest and dividend income 75 155 169 079 22470 451 543 6241 13833 13833 67 771 3 997 other charges Amounts written off investments surplus realisation of investments 35 227 6313 3146 3146 Consolidated profit before tax Taxation and State's share of profits under mining leases 888 107 519916 519916 254 618 182 915 Consolidated profit after taxMinority interest 633 489 10 174 337-001 485 Profit attributable to De Beers Deferred dividends over deducting After companies excess of cost book value of netassets 623 315 308 516 889 926 of shares in subsidiary at dates ofacquisition Johannesburg Consolidated Investment Company Limited JCI A" GCroup equity interest 40,81 per cent JCI is a mining finance company with substantial investments in gold platinum diamonds coal and other minerals and in mining finance companies property and financial investment The valuation of the company's assets taking valuations investments at market valuations and other assets at directors totalled R360,3 million at June 30 1977. Of this total 65.5 per cent was represented by investments in mining and mineral processing and 33,7 financial cent by JCI's interests in industrial property investments and Year ended December 1977 Percentage held Mondi Paper Company Limited 14 Steelbrite Limited 5+ Limited The South African Breweries Limited 18 Toyota South Africa Limited 15 Finance Standard Bank Investment Corporation Limited Property Downtown Real Estate Corporation Limited ~ J.HEIsaacs J.HEIsaacs Propietary Limited Main Place Holdings Milpark Investments Liijiited Limited Liijiited Proprietary Issued capital Ordinary shares - 7 105 600 of R2 each - 8.25 cent cumulative redeemable p eferenceshares. - 000 of R1 each Share premium and reserves Long loans and deferred taxation 1977 R000's 1976 2, RODO'S 211 10.000 200 - 165 961 426129413 426129413 426129413 Investments Listed Book value Market value 147 462 225 357 040 267 811 Unlisted Book value Directors valuation earnings Dividends paid 30 886 60454 030 12'080 849 . 47912 47912 26 206 080 against After extraordinary item provision former subsidiary R12 000 000 investmem in At June 30 1977 the principal investments of the JCI group were as follows Golil Percentage Percentage 2 held % Elsburg Gold Mining Mining Company Limited Limited The Randfontein Estates Gold Witwatersrand Limited Mining Company Western Areas Gold Mining Company Limited Platinum Rustenburg Platinum Holdings Limited Nickel Shangani Mining Corporation Limited Diamonds ' Limited De Beers Consolidated Mines Limited Coal Tavistock Collieries LimitedLimited TheNatal Cambrian Collieries Limited , Antimony Consolidated Murchison Limited Copper Otjihase Mining Company Proprietary Limited Palabora Mining Company Limited Feitochrome Consolidated Metallurgical Industries Limited Mining Finance Free State Development Development and Investment Corporation Limited Industry Andcor Holdings Proprietary Limited Argus Printing and Publishing Company Limited Johnson Matthey & Company Limited Lenning Holdings Limited Louw's Creek Timber Limited Testing of the Huris project Human Resources Information for the Gold and Uranium division centre at Welkomin the Orange first Free State The first phase of the system which will eventually be line to all the Group's gold mines will go into use at Vaal Reefs later this year Gold and uranium bearing Notes- Notes- 1979 redeemable and convertible ORANGE FREE STATE President Brand Gold Mining Company 11.1 AAC Group equity interest - 11.1 cent Year Year ended September 30 1977 1977 Limited Limited Administered by Issued capital 040 000 units of stock Anglo American Corporation Free State Geduld Mines Limited AAC Group equity interest - 2,17 cent Year ended September 30 1977 1977 1976 Issued capital 10 440 000 shares of 50 cents cach R5 220 000 R5 000 000 Tons milled 3.436.000 2 000 Yield - grams Cost per ion milled Working profit Joint Metallurgical Scheme share of profit Taxation and State's 12.89 R21,35 R92 000 R280 000 16.38 R19,91 R73 332000 332000 _ share of profit R29 223 000 R38 319 000 Dividends paid With effect from October R24 000 ~ R20 000 000 1 1976 the mining lease of Freddies Consolidated Mines Limited was amalgamated with that of Free State Geduld and accordingly the 1977 figures relate to the combined operation and are not comparable with the 1976 figures Previously Free State Geduld held 50 per cent of the share capital of Freddies The remaining half interest was relinquished by Western Holdings Limited in consideration for 440 000 shares in Geduld and Freddies is now a owned subsidiarythe company Planned production for the year ending September 30 1978 Tonnage 3 000 Grade 12 grams per ion 000,000 Planned capital expenditureR35 cludes an amount of R2 000 000 000,000 which spent on ex- the metallurgical complex 50 cents each R7 020 000 Tons milled Yield - grams Cost per milled 3.093.000 3.093.000 10,56 R22.12 2-19627.09080 19,56 Working profit Joint Metallurgical Scheme share of profit Taxation and State's R54 064 000 R192.000 R192.000 R70 700 000 = = shate of profit Dividends paid R6 757 000 R18 252 000 R22 000 R23 868 000 Includes 499-500 1976 506 600 tons treated on the company's behalf on cost plus service charge basis by Free State Saaiplaus Gold Mining Company LimitedLimited Planned production the year ending September 30 1978 Tonnage 3 000 which includes 540 000 tons i to be treated by Free State Saaiplaas Grade 9,8 grams | per ton Planned capital expenditure R10 500 000. In i addition an amount of R16 500 000 is to be spent the metallurgical complex President Steyn Gold Mining Company Limited AAC Group equity interest 15,98 per cent Year ended September 30 1977 Issued capital 566 400 shares of 1977 ~ 1976 50 cents each R7 283 000 R7 000 000 Tons milled 3 100 000 593 000 , Yield ~ grams Cost per ton milled Working prolit Joint Metallurgical 8.65 R23.86 R26 277 000 10.52 R22,21 R32 965 000 Scheme shareof profit R621 000 . _ Taxation and State's Free State Saaiplaas Gold Mining Company Limited AAC Group equity interest 16,18 Subsidiary of President Brand Year ended September 30 1977 per cent Gold Mining Company 1977 1976 Issued capital ~ 28 000 shares : R1 R1 each* Tous milled R28 100 000 1 234 000 R28 100 000 1.193.000 1.193.000 Yield - grams Cost per ton milled 3,63 R19,03 .3,26 R15.71 Working loss - gold Uranium profit Joint Metallurgical Scheme share ofprofit R6 000 R4 716.000 R2 173 000 R5 001 000 R128 000 _ Relates mainly to a spot sale made prior to production under the Joint M^'tallurgicalScheme Planned production for the year ending September 30 1978 Tonnage 1 200 Grade 3.8 grams per ion ^ ir addition the company will 45,000 tons of ore a month from President Brand on a cost plus service charge basis Planned capital expenditure R12 000 000 which includes an amount of R11 200 000 to be the mine's new No. 3 shaft system which is reach full operating capacity by 1981 Jeannette Gold Mines Limited AAC Group equity equity interest - 56,45 cent 2 ended March 1978 Issued capild R7 839 000in shares shares of R1 each The company suspended mining op^'rations towards the end of 1955 before coming into production Early in 1974 in view of the increased price of gold * the company began an exploratory drilling programmie to supplement existing data in order to provide sufficient information for an assessment to be made on the viability of opening the mine The programme was completed in November 1977. In all four new holes were drilled three old holes were opened from which deflections were drilled With the exception of a few isolated results which were very good the results were generally poor or only average and an assessment of the results is in progress In order to finance the completion of the drilling programme the company raised additional funds early in -1976 of R603 000 by means ofa rights offer to members for cash at p^rof RI units of transferable unsecured sharoef profit Dividends paid _ 857 000 R523 000 R6 300 000 for Planned production the year ending September 30 1978 Tonnage 3400 Grade 8.0 grams per ton Planned capital expenditure R19 000 000 per which anamount excludes complex of 000 000 be spent on the metallurgial The alive results relate to the company and its wholly subsidiary Video Gold Mining Company Limited which owns the mineral rights on the farm Viden and which President President Steyn mines on behalf of the company from its No.4 shaft Welkom Gold Mining Company Limited AAC Group equity interest 10,95 per cent Year ended September 30 1977 1973 Issued capital 2500 12 shares of ach R6 125 000 1976 R6 125 000 183 000 2 101 000 Cost per ton milled Working profit Taxation and State's 6,36 R20.21 R7 777 000 R926 000 6,28 R18,40 R6 085 000 R389 000 Dividends paid R4 R1837.000 R1837.000 84 Planned production for the Tommage 000 Grade 6.3 expenditure R3 500 000 September 30 grams per t^ne Western Holdings Limited AAC Group equity interest - 6.40 per cem Year ended September September 1977 capital nt Issued capital 1977 : 1976 .7 496 376 of shares 50 cents each Toris milled Yield - grams Cost per ton milled Working profit Joint Metallurgical Scheme share R3.748 R3.748 000 * 3.093.000 3.093.000 11,77 R19,74 R74 389 000 R534.000 R534.000 R3 748 000 2974000 2974000 12.70 R17.54 R75 000 us Taxation and State's share of profit Dividends paid 48 000 990 000 R50 228 000 R23R23 239 000 Duritnhegyear the company relinquishietds 50 per cen interest in Freddies Consolidated Mines Limited in consideration for 000 new shares in Free State Geduld Min~ s Limited In consequence the company is now the beneficial holder of 4.2 per cent of Free State Geduld year Planned production for the ending 1978 Tonnage 3 100000 Grade 14,0 Planned capital expenditure R6 500 000 September 30 grams p~ r to i Anglo American Corporation Group Orange Free State mines Joini Metallurgical Schenie The six mines administered by the Corporation in the Orange Free State Free State Geduld Steyn Free State Saaiplaas President Brand President Steyn Welkom and Western Holdings are involved in major metallurgical scheme which produces uranium sulphuric acid and additional gold from current tailings and reclaimed slimes of these mines The recovery of the uranium from slimes began in pyrite in concentrate July 1977 Year ended September 30 1977 Flotation plams - slime treade tod ns Uranium plant slime treated tons concentrate treated tons uranium oxide produced kg Acid plan acid produced tonsi Gold plant calcine treated tons gold produced k^ Profit March and that from 4767 000 913.000 913.000 + 000 206 845 137 668 34.522 Vib R3 800 000 Administered by other mining finance houses Harmony Gold Mining Company Limited > ended June 1977 1977 1976 Issued capital 26 884 650 shares of 50 cents each R13 442 000 R13 442 000 Tons milled 6 163.000 163.000 5512000 5512000 5512000 Yield - granis Cost per ton milled 5.25 R17,02 Working profit gold uranium pyrite and acid Taxation and State's 422 000 share of profit Dividends paid R3 440.000 RG 000 During the 1975 and 1976 financial years allthe of assets the wholly subsidiaries Merriespruit Orange Virginia Free State Gold Mining Company Limited and Orange Free State Gold Mining Company Limited were acquired by the company Loraine Gold Mines Limited AAC Group equity interest - 3,79 per cem Year ended September 30 1977 . 1977 1976 Issued capital 16 366 986 shares of RI each Tons milled : : R16 367.000 367.000 1.234.000 R16 067 000 1123 000 Yield - grams Cost per ton milled Working loss Profit - uranium oxide and pyrite 6.7 R27.25 R1936 000 R221 000 61,6 R28.00 455 000 R147 000 The company has an assessed loss for taxation purposes estimated at R30 000 at September 1977 and remains classified as an assisted mine in terms of the Gold Mines Assistance Act 1968 | Planned production the year ending September 30 1978 Tommage 1 000 Grade 6,5 grams per fon Planned capital expenditure R1 100 000 St Helena Gold Mines Limited AAC Group equity interest - 0.46 per cent Year ended September 30 1977 1976 Issued capital 625 000 shareosf Ri cach R9 625 000 R9 625.000 Tons milled 2.090 2 000 Yield - grams Cost per ton milled Working profit R41 10.21 R17,60 136000 11,53 R13,43 R59 284 000 Taxation and State's share of profir Dividends paid R17 000 RTI 069 000 R26 216 000 R16 362 000 In terms of an agreement entered into in 1974 with Unisel Gold Mines Limited The company is continuing the establishment of the Unisel mine which the company will develop and operate on behalf of Unisel 85 and will provide certain housing facilities railway facilities and the reduction works capacity to handle the ore from the new mine St Helena will recover a remuneration based on capital expenditure incurred and on tonnage milled once the new mine comes into production in 1979 The company's new reduction works has been operating satisfactorily since March 1977 and the new smelt house was commissioned early in 1978 Unisel Gold Mines .. Limited Year ended September 30 1977 Issued capital R23 136 000 in 28 000 000 shares of no par value The company was incorporated in 1972 and during a the year took cession of mining lease over a portion of the farm Jurgens Hof in the Ventersburg district of the Orange Free State An agreement was entered into ^fin 1974 with St Helena Gold Mines Limited under which St Helena is to develop and operate the new mine on ., the farm Jurgens Hof behalf Unisel During 1977 shaft sinking was completed to a final depth of 1977 metres Trial stoping operations are planned to begin in the first quarter of 1979 and full production to be reached in November 1979 FAR WEST RAND AND KLERKSDORP Administered by Anglo American Corporation Elandsrand Gold Mining Company Limited AAC Group equity interest - 49,99 cent The company was incorporated in 1974 and is establishing a new gold mine in the Oberholzer and Potchefstroom districts of the Transvaal The mining 2 lease covers an area of 619 hectares By the end of December 1977 the materials had been sunk to depth of 1933 metres ventilation shaft reached its final depth metres on January 5 1978. The mine is well materials shalt and the of 195 ahead schedule and is now expected to come into production 1979 compared with the previous forecast of early amounted 1980. Net expenditure from the inception of the company to the end of 1977 amounted to 198,6 million Net expenditure for 1977 R45,4 million and is estimated at R78,0 million for 1978 Year ended December 31 1977 1977 1976 Vaal Reefs of a certain uranium consumer loan and any capital directors expenditure incurred within the area which the of Vaal Reefs decide should be offset against such profit Since the consumer loan received by Vaal Reefs to finance the residual amount required for capital expenditure on the new South uranium plant after taking taxation into account the level of profit available in 1977 for distribution to Vaal Reefs shareholders was equal to that which would have been achieved without the capital outlay on the new uranium plant However in order that the royalty paid to Southvaal Holdings in 1977 should likewise be unaffected the directors of Vaal Reefs decided that capital expenditure on the uranium plant in the South lease area would not offset against working profit derived from the area and consequently no deduction was made for the purpose of determining the royalty The principle that expenditure on the new South uranium plant should not affect the royalty payment to |. the company will continue to be applied as far as possible However in respect of the repayment of the uranium consumer loan over the years 1981 to 1983 appropriations will be made from Vaal Reefs available profits profit during this period period and concurrently equal amounts will be deducted from profits derived from the South lease area in determining the royalty Year ended December 31 1977 1977 ROOO'S 1976 : ROOO'S Issued capital 50 322 825 shares of 20 cents each Capital reserve Mining assets ROOD'S e 10.065 110 233 98 645 R000's 4.473 56117 250 Issued capital 000 000 shares of 50 cents each Distributable reserve Profit after taxation Dividends paid 13.000 59 184 5.460 13.000 335 5.13 1560 In February 1977 the company raised R61 000 by a means of rights issue to members of 20 cents each at R2,20 share of 27 957 125 shares The Afrikander Lease Limited AAC Group equity interest - 44,57 per cem Southvaal Holdings Limited AAC Group equity interest - 9.65 cent Vaal Reefs Exploration and Mining Company Limited mines an area south of the Vaal River in terms of an arrangement under which Southvaal Holdings is paid a royalty equal to 55 percent percent of the profit from gold and uranium before deducting interest and loan repayments due to Soutlivaal Holdings repayments by The company owns freehold rights and mineral rights over uranium areas in the Klerksdorp district of the Transvaal A detailed feasibility study and pilot plant testwork to determine if viable uranium mine could be established was concluded in the latter half of 1977 There is however concern about certain inflationary factors which could affect the viability of the mine which is unlike other South African mines that produce uranium as a product with substantial gold output As a result it has been decided to delay a decision on the establishmem of a mine and temporarily to suspend sales negotiations until talks with the Government on various aspects of the project are concluded and a general reviofetw he feasibility study has taken place Vaal Reels Exploration and Mining . Company Limited AAC Group equity interest 9.76 per cent Year ended December 31 1977 1977 1976 Issued capital 000 shares of 50 cents each Tons milled Yield - grams Cost per ton juilled R9 500.000 500.000 165 000 8.95 R26,75 0 R9 500 000 6.572.000 6.572.000 10.04 K23,29 profit -gold R74 079 000 R66 241 000 -uranium and sulphuric acid R17 018 000 R11 745 000 Royally payment to Southvaat Holdings Limited R8 462 000 R227,000 R227,000 Taxation and State's share of profit R14 250 000 R22 525 000 Dividends paid R21 000 R20 900 000 is The uranium treatment plant capacity of the mine is being expanded to 720000 tons a month which is planned to be reached in the second half of 1979 Sinking of the new No. 9 shaft is scheduled to start in September 1978 and commissioning expected in 1983 Planned production for the year ending December 31 1978 Tonnage 200 Grade 9,0 grams per ton Planned capital expenditure R72 000 000 a Western Deep Levels Limited AAC Group equity interest - 28.7 per cent Year ended December 31 1977 1977 1976 Issued capital * 25 000 000 shares of each Tons milled R50 000 2977 000 R50 000 2941 Yield - grams Cost per ton milled 14,61 R29,48 15,14 R24,70 Working profit = gold i uranium }: Taxation and State's R88 930 000 R3 249 000 R76-366 R76-366 000 719 000 share of profi Dividends paid R45 000 R38 000 R20 625 000 R22 000 : Planned production for the year ending December 31 1978 Tonnage 3.00.00 3.000.000 Grade 14.4 grams per ton Planned capital expenditure R26 000 000 Administered by other mining finance houses The company was incorporated in 1974 and is establishing a gold mine in the Klerksdorp area the Transvaal to the south of the Western Deep Levels Limited mine and adjoining the Elandsrand Gold Mining Company Limited mine The viability of the mine has been based solely on the Ventersdorp Contact Reef VCR which it is estimated will provide 45 million tons of ore at a mean yield of 10.4 granis ton The Elsburg Reels slightly below the VCR and lower in yield substantial additional at little additional cost The uranium content of the VCR and Elsburg Reefs may be of valuien the fiture although this contribution to income was ignored in the feasibility study 2 reached The Nos and shafts have and the provision of the necessary progressing favourably with a in 1980 view their final ancillary depths to trial milling East Driefontein Gold Mining Company Limited AAC Group equity interest 5.28 percent Year ended December 31 1977 1977 1976 Issued capital 510 shares of 1977 1976 Taxation and State's share of profit Dividends declared R20 000 R15 000 R31 874 000 K21 000 Planned production for the year ending June 30 1978 Tonnage 2 900 000 Grade 11,0 grams per ton Planned capital expenditure R15 000 000 Kloof Gold Mining Company Limited AAC Group equity interest - 0,11 cent Year ended June 30 1977 976% Issued capital 30240 000 shares RI each Tons milled R30 240 000 527 000 R30 240 000 1391000 1391000 Yield ~ grams Cost per ton milled Working profit Taxation and State's R25 12,4 11,2 R27,40 R22,70 111000R24 111000R24 111000R24 259 000 . share of profit Dividends paid Planned capital 1978 was R14,1 expenditure million R6 294 000 072 for the year 021 000 _R14000 endedJune 30 Blyvooruitzicht Gold Mining Company : Year ended June 1977 Limited capital Issued capital shares 000 000 of 25 cents each 1977 . RG 000 000 1976 R6 000 000 Tons milled 000 1945.000 Yield grams _ Cost per ton milled 12,48 R25,53 12,79 R19,60 RI each Tons milled Yield - grams Cost per ton milled Working profit Taxation and State's share of profit Dividends paid R54 000 2.096 2.096 000 23,3 R25,08 R145 914 000 R83 304 000 R42.518000 R42.518000 R54 000 1771000 1771000 R21,21 R21,21 R82 214R21,21000 R28 181 000 840 883 000 West Driefontein Gold Mining Company Limited Year ended June 30 1977 Issued capital 082160 082160 shares of R1 each Tons milled 7 1977 1976 * R14 2223000 2223000 R14R14 082 000 -2 646 000 Working profit - gold Working profit 1976 loss uranium R32 620 000 R759 000 . R50 000 . R222 000 Elsburg Gold Mining Company Limited AAC Group equity interest 7.98 per cent Yield - grams Cost per ton milled Working profit 23,7 R25 21,5 R18,81 R18,81 Taxation and State's Year ended December 1977 -gold -gold R131357 R131357 000 R152 000 share of profit R9 000 R24 000 1977 1976 uranium and acid R3.890.000 R3.890.000 R3.890.000 587 000 _ Dividends paid R11 000 R18 000 000 ROOD'S R000'S Taxation and State's ~ . 000 * Includes revenue of R1 061 from 281 kilograms of gold Issued capital share of profit R79 000 R92 000 sold from clean operations at the old reduction works 30 203 000 stock tinits by Dividends paid R39.430.000 R47.175 000 < ye Capital ended expenditure for the current financial year is estimated at R10,5 million and will incurred mainly of R1 each Dividends paid 30 203 2.552 203 0945 Planned capital expenditure for the year ended June 30 1978 was 500 000 Ren ot preparations for increased the western section of the nine production from the The company owns 48.7 per cent of the equity of Western Areas Gold Mining Company Limited salient features of which are as follows Zandpan Gold Mining Company Limited Buffelsfontein Gold Mining Company Limited Group equity interest - 8,79 per cent Issued capital 40 306 950 in stock 1977 1976 AAC Group equity interest 9,13 cent The company's main business is the holding of 19,6 per cent investment in Hartebeestfontein Gold Mining Year ended June 30 1977 Sake Issued capital 11 000 000 shares of 1977 1976 BY units of RI each Tous milled Yield - grams Cost per ton milled R40 000 579 6,0 R21.56 R40 307 000 3.585 6,37 R17,22 Company Limited the operating resuoflwt hicsh appear earlier this section Year ended June 30 1977 . spe 1977 1976 R1 each Tons milled Yield - grams R11 000 000 3.199.000 3.199.000 9,15 RI1 000 000 000 9.31 Working Working profit R15 047 000 RI 584 000 R5 240 000 R16 383 000 R2 056000 046 000 Issued capital 13 020 285 shares of R000's ROOO'S Cost ton milled Working prolit gold Net profit - uranium pyrite and acid R24.20 R25 000 R9 502 000 R21,46 R21,46 R36 000 R5 482 000 Hartebeestfontein Gold Mining Company Limited R1 each Dividends paid 13.020 864 020 4.069 _ Taxation and lease payments : R15.058 000 R20 Dividends paid R14 000 | R13 000 Planned capital expenditure for the financial year ended . June 1978 was R18 300 000 Deelkraal Gold Mining Company Limited AAC Group equity interest 1.56 cent Year ended December 31 1977 Isued capital R12 600 000 in each 63 000 shares of 20 AAC Group equity interest Year ended June 30 1977 Issued capital R1 1 000 shares of R1 each Tons milled Yield grams ton milled Working prolit - uranium and pyrite 7,42 cent 1977 . 1976 R11 200 2 830 11,3 R25,91 'RIF 200-000 000 FL4 R22,03 R37 735 000 R4 424 000 -R53 938 000 R3 108 000 EAST RAND AND EVANDER Administered by Anglo American Corporation East Daggafontein Mines Limited AAC Group equity interest 13,31 cent Year ended December 31 1977 fe Underground operations at the company's mine were terminated in November 1976 and subsequent activities have been confined to clean operations and the salvage and sale of plant and equipment The company has negotiated the sale of its gold recovery plant and in terms of the agreement will receive a share of the income from the sale of gold recovered by the buyer from the surface area of the mine and from material brought in from outside sources Two tributing agreements providing for royalty payments to the company have been concluded in the first instance limited underground mining operations in a defined area are permitted with a view to recovering recovering small patches of residual which could not be profitably mined by the company prior to the cessation of underground operations In the second case the mine tributing agreement provides for neighbouring to mine an area of 12 hectares within the company's mining lease area East Rand Gold and Uranium Company Limited Ergo AAC Group equity interest Year ended March 1978 38,81 per cent Ergo has established a treatment plant in the Springs atea for the purpose of recovering recovering gold uranium and on sulphuric acid from old mining slimes dams the East Rand The company began production in February 1978 with the recovery of the first uranium Sulphuric acid production started in March and the first bar of gold bullion was produced in April Initial annual production will be approximately 7000 7000 kilograms of gold 200 ions of uranium oxide and 000 tons of sulphuric acid of which about 000 tons will be for sale and the balance will be used by the company The issued capital is R20 000 000 40 000 000 shares of 50 cents each Administered by other mining finance houses The South African Land & Exploration Company Limited AAC Group equity interest 18.95 cent Year ended December 1977 Issued capital 1977 6 600 000 shares of 35 cents each Tons milled from dumps Yield ton The previous year's op^'rationsare the 1976 figures have therefore been R2 000 897 000 2 1,82 not comparable and omitted vicinity Notwithstanding that underground mining operations ceased at the end of 1976 recovery of gold from clean and treatment of waste rock dumps in the vicinity realised gold revenue of R6,7 million for the year ended December 31 1977. Revenue of R2,9 million from the of capictapaitlal items salvaged equipment and scrap plus sundry revenue of R761 000 brought the mine's total of income for the year to R10,4 inillion After deductions R6,9 million for operating and salvage costs and estimated taxation of R831 000 the company company recorded a surplus of R2,7 million for Prospecting expenditure the year totalled R462 000 and drilling of the two surface exploration boreholes in the area to the south and south of the mine workings is continuing The total drilling expenditure to December 1977 amounted to R576 000 which is being financed from'she proceeds of the rights issue made towards the end of 1976 It estimated that a further amount of some R400 000 will be spent to complete this phase of the drilling programme and a decision regarding further boreholes dependent on the results of the currem drilling drilling phase they become known so : Winkelhaak Mines Limited AAC Group equity interest Year ended September 307977 - 8,20 per cent 307977 Issued capital 12 000 000 shares of R1 each Tons milled Yield - grams Cost per ton milled Working profit ! Taxation and lease consideration Dividends paid 1977 R12 000 025 000 . 7,85 R13.13 R32 000 R21 782 000 R10 320 000 1976 R12 000 000 2015.000 2015.000 7.65 RII R30 R20 000 R9 120.000 Diamonds Administered outside the Anglo American Corporation Group De Beers Consolidated Mines Limited De Beers AAC Group equity interest 30.37 per cent found Financial details of De Beers may be found on page 83 of this report unless Principal interests at December 31 1977 all wholly- owned subsidiaorthi ere wis se indicated 88 ' The Kimberley Division of De Beers operates the De Beers Dutoitspan Bultfomein and Wesselton inin~ s at Kimberley the Finsch mine north of Kimberley and the Koffiefomein mine in the Orange Free State The Namaqualand Division is currently mining alluvial deposits on the farmis Annex Kleinzee and Dreyers Pan Production from the new Koingnaas and Langhoogte operates mines will commence shortly De Beers also Premier mine at Cullinan in the Transvaal the The Consolidated Diamond Mines of South West Africa Proprietary Limited carries on open alluvial mining operations along the southern portion of the coast of South West Africa and is a leading producer of gem diamonds De Beers Lesotho Mining Company Proprietary Limited 75 per cent owned operates the Letseng Terai diamond mine in Lesotho which reached full production in September 1977 4 De Beers Botswana Mining Company Proprietary Limited 50 per cent owned operates the Orapa and Letlhakane mines in Botswana An important new mine is shortly to be developed at Jwaneng in southern Botswaria and will take about four years to be brought into production 5 De Beers Industrial Diamond Division Proprietary Limited is the outlet for the sale of De Beers natural diamond drilling materials and boart It is in addition the management company implementing the policy of the industrial diamond division and administers the De Beers Diamond Research Laboratory 6 The Diamond Corporation Proprietary Limited and its subsidiaries contract with various producers who are not members of The Diamond Producers Association Association for the purchase of their production The corporation has built up large financial resources which facilitate the holding Trade of stocks of diamonds thereby stabilising the 7 De Beers Industrial Corporation Limited 160,93 per cent owned is an industrial finance and investmen 4 = A wholly Limted subsidiary Balgray anthracite Collieries_ Proprietary Limited mines lower grade anthracite in the district of Utrecht Natal The other two wholly- owned subsidiaries Carnarvon and Impati supply anthracite from their existing dumps * Eighteen months ended Year ended December 31 June 30 1977 1976 Issued capital 000 000 stock of units 50 cents each Co^lsales ~ tons Consolidated profit R2 000 000 1 488 000 R2 000 727 000 alier.taxation R7 513 000 R2 000 Dividends paid R2 680 000 R1.080 Includes sales by the owned subsidiaries Balgray Carnarvon and impati Natal Coal Exploration Company Limited AAC Group equity interest 33,83 cent With the closure of the company's colliery in October 1968 the company's business is confined to the receipt of royalty income from 1 The lease of its bituminous coal trade allocation to ee. three other producing collieries in Natal 2 The lease of its coal reserves in the Mooikrantz Ti ^oThe Natal Cambrian Collieries Limited The exploit- able reserves are expected to be exhausted by 1980 Eighteen months ended Yeai ended company whose main asset is a direct and indirect interest of 39,98 cent in the issued ordinary share capital of AECI Limited It also has a direct interest of 9,16 cent in Mondi Paper Company Limited De Beers Consolidated Mines Limited and its subsidiaries hold 33,14 cent of the issued ordinary share capital Anglo American Corporation of South Africa Limited and also have substantial direct interests in other mining finance investment companies as well in gold and uranium diamond copper and other base metals coal industrial and commercial banking and property companies Coal The principal companies in the group are as follows fall owned subsidiaries unless otherwise indicated mining and related activities Amalgamated Collieries of South Africa Limited Amcoal Exploration and Finance Limited Anglo Power Collieries Proprietary Limited Blesbok Colliery Limited . The Coronation Collieries Limited New Largo Colliery Limited South African Coal Estates Witbank Limited Springbok Colliery Limited Springfield Collieries Limited Transvaal Coal Corporation Limited Vryheld Coronation Limited 65 per cent held Witbank Coal Holdings Limited Industrial Vereeniging Refractories Limited 51 cent held Issued capital 000 000 shares of 50 cents each Net profit Dividends paid December 31 1977 R000'S 2.500 311 313 June 30 1976 R000's 2.500 2 209 200 Swaziland Collieries Limited : The company operates ^ colliery at Mpaka Swaziland Year ended March 1978 Issued capital 1264 1264 620 shares of 1978 1977 E2 each ~ Coal sales - tons E2 529 240 134.000 134.000 E2 529 240 Net profit E311000 E311000 Administered within the Anglo American Corporation Group Anglo American Coal Corporation Limited Amcoal AAC Group equity interest - 48,56 per cent Financial details of the Amcoal group are given on page 79 . Group coal and coke sales comprise the following 1976 Tons Tons Escom 15 608 000 447 000 Iscor 755 000 1985 000 Transvaal Coal Owners Association TCOA Other 7514 25.000 25.000 5.889 5.889 000 891 000 25 702 000 212000 212000 Morupule Colliery Proprietary Limited AAC Group equity interest 53,0 cent The company operates &@ mine near Palapye ^fin Botswana The bulk the coal produced is sold to the Botswana Power Corporation and BCL Limited Fifteen months ne ended Year ended Issued capital 100 shares of PI each March 31 119978 78 P100 December 31 119976 76 P100 Coal sales ~ tons Net profit 357.000 357.000 PI 157000 226.000 P539 000 Financial amounts are expressed in Botswana currency Natal Anthracite Colliery Limited AAC Group equity interest 41,1 cent The company operates a colliery near Vryheid Natal which produces grade low phosphorus anthracite amounts are expressed in Swaziland currency Vierfontein Colliery Limited AAC Group equity interest 7,64 per cent The company operates a colliery in the Viljoenskroon district of the Orange Free contract State and produces bituminous coal for sale under contract to the Electricity Supply Commission's Vierfontein Power Station Eighteen months ended Year ended December 31 June 30 1977 1976 Issued capital 000 000 shares of ' cents each Coal sales = tons Profil after taxation R2 000 000 1946 000 R560 000 R2 000 000 361000 361000 R429 000 Dividends paid R480 000 R340 89 Wankie Colliery Company Limited The company mines coal and produces coke Rhodesia Year ended August 1977 Issued capital 1977 1976 25 333 488 of shares $ each 25 333.000 333.000 25 333 000 Consolidated profit after taxation Dividends paid Eighteen months ended December 31 1977 R672 000 R560 000 . Year ended June 301 1976 R431 000 R336000 Sales Goaltons Goaltons Goaltons 2197-00 2197-000 496 000 Sales by the owned subsidiary company Indimeni Coal Mines Limited Coke - tons 194.000 194.000 211 000 Tar - litres 595 000 7 804 000 Profit taxation Dividends paid Investments Listed At cost 2 643 000 900 000 . $ 790 000 * 1.900.000 1.900.000 045 000 $ 080 000 Administered outside the Anglo American Corporation Group Market value 755 000 S774 000 Apex Mines Limited Unlisted 000 Other loans 5294 000 52 558 000 224.000 S3 are . amounts expressed in Rhodesian currency AAC Group equity interest 4.44 per cent The company operates a colliery in the Witbank district the Transvaal Zuinguin Natal Collieries Limited AAC Group equity interest - 48.13 per cent The owned subsidiary tudumeni Coal Mines Limited operates a colliery near Dundee Natal and produces coking coal for supply to the South African Iron Steel Industrial Corporation Limited Iscor Eighteen months Year ended ended December 31 June 30 Issued capital 1400 000 shares of 50 cents cach Coking coal sales tous 1977 R700.000 R700.000 .552.000 .552.000 1976 R700 365 000 Year ended December 31 1977 capital Issued capital ordinary shares 1950 000 1977 950 5 per cent redeemable cumulative preference shares - 000 of R2 each 80 000 Coal - sales tons Net 2 101 000 R5 633 000 Dividends Dividends paid ordinary R692 000 1976 R1.950.000 R1.950.000 R180 000 1873 R6083 R6083 000 R692 000 Blinkpan Koolmyne Beperk AAC Group equity interest - 17,50 cent This company which is part of the Trans Coal Corporation Limited group operates two mines in the Middelburg district of the Transvaal Blinkpan Colliery which supplies coal to Escom's Kornati power station and the recently established Haasfontein Colliery which was developed to supply a portion of the coal export requirements arising from the contract between the TCOA and the Japanese steel mills During the year ended June 30 1977 sales of Haasfontein coal contributed 854 000 tons towards total of sales 3 569 000 tons by the company Ss Trans Coal Corporation Limited The company operates a group of collieries Transvaal and Natal the = Year ended June 30 1977 Issued capital 50 760 000 shares of 50 cents each ~ Coal sales Net profit tons Dividends paid 1977 1976 R25 380 000 20 481 000 R19 107000 107000 RS 037 000 R2 000 17955.000 RIO 000 R4018 R4018 000 Witbank Colliery Limited AAC Group equity interest interst - 0.47 cent Through a owned subsidiary operates five collieries in the Witbank Transvaal Year ended September 30 1977 the company district of the St Issued capital 6 288 280 ordinary 1977 1976 shares of R2 each Coal sales tons Consolidated profit after taxation Dividends paid R12 000 6.862'000 6.862'000 R12 000 6.068 000 R34 000 R3 333 000 R14 000 R354.000 R354.000 recurring After deducting R131000 R131000 in respect of non recurring transactions ' : Other mining Administered within the . Anglo American Corporation Group Middelplaats Manganese Limited In 1969 the company acquired the mineral remaining extent of the farm Middelplaats situated in the Sishen area of the northern Cape manganese belt ' Drilling on the property indicated reserves of manganese ore in excess of 52 million tons at grade of approximately 38 cent manganese and four per cent Hon . Following detailed leasibility report the mine is with the presently under construction sinking the rock shati and incline services ramp Site preparation for the construction of the plant has begun and the establishment of housing for employees is continuing The deposit will be mined by underground mechanical methods and is planned that production will begin in 1979 The estimated capital cost of the project is R47 million Rhodesian Nickel Corporation Limited AAC Group equity interest - 34,11 cent The company owns the entire issued share capitals of Trojan Nickel Mine Limited and Madziwa Mines Limited whose nickel mines are situated in the Binduga Filabusi and Shanya districts of Rhodesia company's other wholly subsidiary Bindura Smelting and Refining Company Limited which is situated next to the Trojan Nickel Mine at Bitdura fom produce refined nickel nickel concentiates received from the company's three nickel mines and also from Shangani Mining Corporation Limited's mine 100 kilometres north of Bulawayo Copper is also produced as a product of the relining process Year ended March 1978 1978 1977 5000's 5000's Issued capital 000 shares of 50 cents each : 12000 12.000 12.000 Unsecured loans . Equity earnings Dividends paid 928 2.275 720 17485 599 680 amounts are expressed in Rhodesian currency eben OLA DIVISION nVIS{O! Ny Shangani Mining Corporation Limited AAC Group equity interest - 12.50 cent The company operates a nickel mine at Shangani about 100 kilometres north of Bulawayo in Rhodesia Mining operations operations started in the first quarter of 1976 and during the year ended June 30 1977 tonnage milled amounted to 1219 000 tons One is refined by the Bindura Smelting and Refining Company Limited Swaziland Iron Ore Development Company Limited . Woe perfem AAC Group equity equity interest - 59,4 perfem perfem for The company is currently tulfilling contract for the supply of million dry long tons medium ore to Japanese steel mills Railage loading facility problems at Maputo during the period review resulted in the company failing to meet its contractual delivery target of two million tons a year However the company operated at profit and dividends were declared , In December 1977. mining operations ceased as a result ore resrves reserves being depleted and presently the is Company treating a large accumulated stockpile Ar current delivery rates all operations at the mine are expected to end during 1980 Zinchem & Industrial Mineral Resources Proprietary Limited AAC Group equity interest 76,42 cent The company through its major subsidiaries G. & W. Base and Industrial Minerals Proprietary G. Limited & W. Industrial and Chemical Supplies Proprietary Limited and Hudson Mining Company Proprietary Limited is engaged in the mining processing and marketing of wide range of industrial minerals minerals number of industries including the foundry refractory paint rubber plastic oil drilling chemical ceramic glass agricultural and pharmaceutical industries It has a number of mining operations in various parts of the country and its main processing plant is situated at Wadeville Germiston G. W. Industrial and Chemical Supplies also exports chrome sand to Europe and operates drying and bagging plant at Vlis^ngen in Holland from which the product is distributed throughout Europe Another subsidiary Zinchem Proprietary Limited produces zinc dust for the gold mines and the paint industry and zinc oxide for use in the subber paini ceramic pharmaceutical agricultural and chemical industries us Administered outside the " Anglo American Corporation Group * Botswana RST Limited AAC Group equity interest 12.05 cent The company of which the Group and associates directly and indirectly hold nearly 30 per cent has an interest of 85 per cent in BCL Limited company conducting a nickel and copper mining operation at Phikwe in Botswana The remaining 15 per cent interest in BCL is held by the Government of Botswana The Phikwe project is being undertaken in two phases The first phase completed in 1977 involved the facilties construction of the mining and ancillary facilties Phikwe the smelting and concentrating facilities for the entire project and the mining shaft at Selebi The second phase comprising the development of the underground be mine at Selebi is expected to completed in 1979 Processing problems are being resolved in all sections of BCL's operations and during the second half of 1977 production of copper maite reached a further record of 19 307 tons Year ended December 1977 . 1977 P000's P000's Issued capital shares 979 282 shareosf P2 Long loans Mining assets and other each capitalised expenditure Production of copper mattesales tons Total sales revenue Net loss 3 35.959 278 964 35.959 227913 056 '204 182 30772 68 540 35 082 32.506 64.041 64.041 913 All amounts are expressed in Botswana currency Cleveland Potash Limited AAC Group equity interest - 12.50 per cent The company operates a potash mine and an associated processing plant in the Cleveland area of north England The introduction of continuous mining machines which began in 1977 and the adaptation of conventional mining techniques to deal with the difficult geological conditions have produced improved results A further sum of 18 million was made available by shareholders to the company during the year to meet expenditure required for the build of production Year ended December 31 1977 1977 1976 Issued capital ordinary shares - 7 000 000 E000's 6000's 1977 1976 Year ended December 1977 A ordinary shares Zambia Copper Investments Limited 1977 1976 C000's > : 1 Issued 10 capital of : of each 000's 7.000 7000 Issued capital stock shares no 1977 5000's 5000's 1976 5000's 5000's holds the remaining 49 per shares ordinary . Year ended March 31 1977 cent in the form of B 1977 1976 10 per cent redeemable par value 247 x K000'sK000's K000'sK00's participating preference Total shareholders equity 254 826 Issued capital : shares of each : 000 500 Investments in other ' A ordinary shares - 64 373 152 : 1 Share premium 123 companies 927 530 of K2 each 746 128 746 i All amounts expressed in United Kingdom currency Gross revenue from sale of B ordinary shares - 61 848 715 . are products less freight and of K2 each 698 123 698 Mining Smelting Hudson Bay Mining and Smelting Co. Limited Hudbay expenses 346 343647 five per cent redeemable selling . Net earnings after taxation cumulative preference shares before extraordinary items 4413 2819 - 153 970 of K2 each 308 416 i Hudbay a Canadian company is a diversified resource- Net earnings loss after 5 per cent redeemable in oriented organisation with Canadian and international extraordinary items 56.990 8279 8279 cumulative preference shares 636 operations and investments in the fields of mining and Dividends paid 6.061 8018 - 050 of K2 each 570 636 metallurgy fertilizers and chemicals and oil and gas amounts are expressed Canadian currency Share premium and reserves 348 905 2 Anglo American Corporation of Canada Limited in Long loans 579 732 which the Anglo American Corporation Group has a Inspiration Consolidated Copper . . 29,5 per cent interest has in turn a direct and indirect Company ICC 810 414 approximataeprolximay Lake Manifromtoba per all of sales copper interest of 38,13 per cent in Hudbay ICC is an integrated American American natural resources com- 425 386 Hudbay primarily produces copper and zinc from ore pany Its principal business is the production and sale Average proceeds per ton K1072 K768 mined in the Flin : of from its operations which includes mines Total revenmu etae ls 506 320 tely kilometres area approximately 650 kilometres of Winnipeg smelter refinery rod fabricating and sulphuric acid Net profit 34.492 864 north west resrves are : ! Production of ore from these mines totalled 182 1822 000 plants in the state of Arizona It has substantial reserves All amounts expressed in Zambian currency tons in 1977 1976 1 563 000 tons and metal produc- of copper ore ICC also smelts bearing materials tion from all sources was as follows for other producers and owns and operates a silver mine Roan Consolidated Mines Limited : 1977 1976 in Montana : 000's 000's At December 31 1977. Hudbay and Minorco had The company operates Chambishi mines the Zambian :i 550 interests of 23.42 and 15,62 per per cent respectively in ICC Luanshya Chibuluma and Chambishi on the Zambian pounds of Western Copperbelt Refined copper poundpousnds 363 550 Copperbelt In June 1978 the two companies announced that they at Kalengwa in Kalengwa Kalengwa the North Western Province Province Refined zine Ndola Zambia and copper : 820 860 proposed to make an offer for all of the shares ICC not of a refinery at the pounds of Cadmium government 51 the of 219 283 already held by them H^...dbay and Minorco have pooled The Zambian holds cent per cent the ordinary form Selenium pounds 135 120 issued their ICC interests in a owned US company which company's share capital in of Copper Limited 74 Investments Gold ounces , 66 will also become the holder of all shares acquired as a A ordinary shares Zambia Silver ounces 322 221 holds 12.25 per cent of the equity in the form of B pounds Lead . 915 695 result ofthe offer ordinary shares Year ended December 311977 311977 Proven reserves of copper ore in the company's mines in the Flin Snow Lake area at December 31 1977 totalled 17511 17511 100 t^nsassaying copper 2,75 Issued common stock S 292 184 shares of 1977 1976 Year ended June 30 1977 1977 KOOO'S 1976 - K000's < : . * at : 0.036 cent zinc 2,7 per cent gold 0.036 ounces per ton silver 51 each i 0.53 ounces per ton Number of shares : Since 1970 Hudbay has diversified into other outstanding S3 292 000 | S3 292 000 3 269 984 3.269 984 Issued capital A ordinary shares - 15 460 684 of K4 each 61843 843 manufctures resources and geographic areas the most important of Total shareholders B ordinary 14 854 382 which are equity 101 387 000 5113 183 000 of K4 each 417 417 : i ; 1. A 50.5 per cent interest in Terra Chemicals Deliveries of copper Share premium and reserv~ s 163 658 147 664 : : International Inc. which manufactures chemical pounds .90.873.000 .90.873.000 90.593.000 90.593.000 Long liabilities 77.737 172 192 it a corporation in S91 procpreoceds eds currency : : ! fertilizers and feed ingredients at Port Neal Iowa and Revenue S95 000 S91 000 Production of finished ! distributes these and allied agricultural products in Net loss 1976 earnings ST1 000 S126 copper tonS 444 994 the United States Dividends paid on Copper sales tons 446 271431 A 54,9 per cem interest in Francana Oil & Gas Ltd common stock 654 000 635 Average per ton K 118 K806 3 3 which is engaged in the exploration for and All amounts expressed in United States currency Total sales revenue 309 369 226 536 } : production of crude oil and natural gas Canada and . Net profit 1976 1985 in 20.855 292 oO : . i which in turn has 56,8 per cent interest in Trend Kiln Limited All amountsamounts amounts aarre e expressed expressed in ZambZian ambiZambaian n currency : Kiln Products Limited International Limited a corporation engaged pri- : minartihley Uinnittheed pSrtoadteusctainodn oifntcerrundaetiooinlalineIxnpdloonreastiiaonanfodr TAhAeCcGormopuapneyquwithyicinhteirsesat m-e4m1b,e8r5 poefr ctheentGold Fields of Rustenburg PlatPlaitinunm um HoldiHoldings ngs LiLimmitiedted RPH :: % oil and gas interest Canadian Merrill Canada 3. 61,9 per cent interest in Canadian Merrill which is engaged principally in oil and gas duction in and the United States Consolidated Ltd pro- 4. A 23,4 per cent interest in Inspiration Consolidated Copper Company which is primarily engaged in the production and sale of copper from its Arizona properties interest in Whitehorse Mines 5. A 41,2 per cent interest in Whitehorse Copper Mines Limited which produces copper concentrates from a mine at Whitehorse in the Yukon Hudbay South Africa Limited group operates kiln at the Berg Aukas mine Grootfontein in South Africa It produces zinc oxides from zine silicate concentrates and bearing residues purchased from its wholly subsidiary The South West Africa Company Limted The zinc oxide production is sold to a South African zine -refining company within the Gold Fields group eN Nchanga Consolidated Copper Mines Limited The company operates a copper mine a refinery and AAC Group equity interest - 19,97 per ceni The company holds the entire issued share capital of Rustenburg Platinum Mines Limted Limited which operates three major platinum mines in the Transvaal and is the world's largest primary producer of platinum Other platinum group metals as well as nickel and copper are important contributors to total revenue In September 1977 the entire issued capital of Atok Platinum Mines Proprietary Limited was acquired which has increased the spread of the company's platinum mining operations t 1 . ui ra announced in June 1978 that it was making an offer for all the outstanding Whitehorse shares which it did already own During 1977 the company's Sylvie Division potash mine and refinery was sold to the province Potash Corporation of Saskatchewan for 143 million centralised services division at Kitwe and copper mines at Chingola and Chililabombwe on the Zambian Copperbelt A lead and zinc mine is in operation at Kabwe some 200 kilometres south of the Copperbelt The Zambian government holds 51 per cent of Nchanga's issued ordinary share capital in the form of YeaYear r ended AugAuguust st 1977 capital Issued capital of 123 440 625 shares 10 cents each 1977 R000'S 1976 R000's 12 300 300 92 Share premium and reserves Fixed loans 1977 R000's 000 49 400 1976 R000'S 248.000 248.000 65 600 Year ended September 30 1977 Issued capital 991 660 stock units of 1977 1976 Oil and gas 50 cents each fully paid R5 496.000 496 000 recoupments Unlisted investments Equity earnings Dividends paid 271 800 400 4600 3.100 400 * 100 36.900 12.300 Profits declared for 1977 are not comparable with those of 1976. Two major changes took place in the basis of accounting in respect of the method of valuing stocks and charging capital expenditure to current costs of production S.A. Manganese Amcor Limited Samancor Samancor is engaged in the mining of manganese ore at four mines in the western Cape Province The company has two chrome mines and a third is planned to begin production in 1978. Smaller mines in the group produce silica dolomite and serpentine Samancor is also involved in the production of fertiliser phosphorus and phosphoric acid alloys and chrome and chrome at plants in the Transvaal Year ended December 1977 Issued capital Ordinary shares 27 727 500 of 20 cents each fully paid 131 700 of 20 cents each two cents paid 10 per cent cumulative redeemable preference shares ~ 000 000 of RI each premium and reserves Shareterm liabilities and deferred taxation Investments Unlisted - 1977 R000's 1976 R000'S 7.000 152.160 7.000 133 450 420 16.695 16.695 000 shares of 50 cents each one cent paid premium Share reserves and Long loans Production of finished copper tons Average price per ton Equity earnings Dividends paid Excludes exceptional loss R323.000 R323.000 R3 000 u R3 000 R100 000 R101 459 000 K26 925.000 R15 992000 992000 37736 41.289 41.289 RT 104 110 R6 172.000 172.000 R3 000 R13 868 000 R4 946 000 of R3 297 1976 profit Tsumeb Corporation Limited AAC Group equity interest - 2,38 cent Thecompany is engagedin the mining and treatment of copper lead zinc cadpzium and silver in South West Africa Year ended December 31 1977 1977 1976 Issued capital 000 000 shares of 50 cents each R000's 2000 2000 R000's 2.000 Distributable reserve term loan and taxation and fixed Inventories : Metal sales Net profit Production 27 229 22 264 46446 945 2212 017 277 174 71 160 Copper - tons Lead - tons Zinc ~ tons Cadmium - Kilograms Silver - grams 827 34 446 141 88 076 43 668 19 498 34 655 1770 117-878 35 080 940 Administered outside the Anglo American Corporation Group Canadian Merrill Lid The company is involved in the exploration for and production of oil and gas in Canada and the United States 61,9 per cent of the equity is held by Hudson Bay Mining and Smelting Co. Limited Year ended June 30 1977 capital stock Issued of 137 shares no par value Total shareholders equity Gross operating revenue Net income after extraordinary items 1977 5000's 6.993 13469 16 331 555 1976 5000's 6 692 9613 552 1987 amounts are expressed in Canadian currency Production Crude oil barrels total 241000 - daily average Natural gas million cu ft - total 660 11 800 - daily average .32 Francana Oil & Gas Ltd is The company engaged in the exploration for and the production of crude oil and natural gas in Canada and Anglo has a 56,8 per cent interest in Trend International Limited Anglo American Corporation of Canada Limited and Hudson Bay Mining and Smelting Co. Limited hold interests of 28,29 per cent and 54,9154,91 per cent respectively in Francana Year ended December 31 1977 Book value 377 4377 1977 1976 Directors valuation Other 8612 25 002 309 20 987 Whitehorse Copper Mines Limited The company operates mine ^/ndmill at Whitehorse in Issued capital stock 000's 5000's Equity earnings Dividends paid - ordinary 523 015 613 994 the Yukon on behal offa joint venture in which it has a thirds interest and which produces copper gold and concentrate form Almost all of the company's- 7 793 752 common shares of no par value Total shareholders equity 37 1400 48 827 37 140 38.920 income derived from the joint venture All con- Gross operating revenue 63.836 63.836 237 Tara Exploration and Development centrates produced are sold to Hudson Bay Mining Net earnings before extraordinary Company Limited and Sinelting Co. Limited which has a 41,2 per cent item 1976 9.907 1.994 AAC Group equity interest 3,41 per cent The company in which Charter Consolidated Limited Limited has a 10,8 per cent interest operates a zine mine at Navan in the Republic Ireland through its subsidiary Tara Mines Limited The mine and concentrator are interest in the company Anglo American Corporation of Canada Limited holds the remaining third interest in the joint venture In June 1978. Hudbay announced that was making an offer for all the outstanding Whitehouse shares which it did not already own Net earnings loss after extraordinary item 9907 18136 All amounts are expressedin Canadian currency Production North America Crude oil barrels 18136 designed to produce 000 short tons of zinc concentrates from 2.5 million tons of ore a year Year ended December 1977 . 1977 1976 - total ~ daily average 743 000 2037 000 1904 Production started in June 1977 and although labour inrest delayed the mine development programme in first . 1977 productionin the satisfactorily quarter of 1978 proceeded Issued capital 3 392 502 1976 3 shares of no parvalue Total shareholders 386 102 S000's 7238 7238 11 623 mae The Messina Transvaal Development Company Limited | Shaofrjoe int venture revenue Net income after extraordinary item 496 103 5000's 227 11510 1979 558 gas cu millmii llio onn ft - total - daily average Oil and gas land gross acres North -total area holdings America Production and land figures given below 402 9.3 943 8.1 840 2 864 000 exclude Trend which is AAC Group equity interest - 13.35 cent The company mines copper in the northern Transvaal Production Copper - pounds 000 24 364 000 Trend International Limited Trend Recrat and in Rhodesia and has interests inequipment property motor vehicle manufacturing earth moving equipment container manufacturing and finance companies Gold - ounces Silver - ounces 2.4.000 250 19.000 19.000 000 All amounts are expressed in Canadian currency Trend through its wholly subsidiary Trend Exploration Limited is engaged primarily in the production of crude oil in Indonesia through a joint 93 ain Be venture forared to explore for and develop hydrocarbon reserves the Salawati Basin of Irian Jaya Trend has a 27 cent interest in and acts venture which holds a concession as operator of the joint concession awarded in October 1970 for ter ofm 30 years years The joint venture operates operates under a production sharing contract with Pertamina the National Oil Company of Indonesia Hl In 1976 the production sharing contract with Perta- mina modified The amendments which became effective on January 1 1978 increase the Indonesian Indonesian Government's share of after profits from 65 per cent to 85 per cent and require ccapital apital costs be amortised over a period of years instead of during the yearyear in which they are incurred In addition addition contractors were were required to make special payments to the Indonesian Govern- iment with respect special payments by Trend have been 1977 earnings after 1976 54 900 000 to 1977 and 1976 production The of 143.000 143.000 1976 58 000 charged to revenue and reduced minority interest by 1787 000 Trend also holds producing oil and gas properties in the United States and Canada Canada and conducis an extensive prospecting prospecting program inmthe ese Year ended December 31 1977 and alwoad 1977 1976 5000'S 5000's Issued capital stock 147 838 common shares of BDS24 each 548 3548 Total shareholders equity Gross revenue 52 654 53 802 48 502 48 110 Net earnings loss after extraordinary item All amounts are expressed 1165 70979 in United States currency Production Crude barrels Indonesian production sharing |. contract total millions . - daily average Trend's share total millions - daily average North America - total ~ daily average gas millio min ll io nc ci ifi North America America America - toral . daily average 28,5 78.000 2.8 428 000 173 .766 .2.1 27,7 75 700 2,6 7123 358.000 358.000 982 626 1,7 Oil and gas land holdings total area North America total area overseas 19960 2414 248 Industry and commerce Administered within the Anglo American Corporation Group Boart International Limited Boait a owned subsidiary of Anglo American Industrial Corporation Limited is through its sub- sidiaries and associates engaged in the manufacture and marketing of all types of diamond and tungsten carbide tipped drilling tools and in surface and underground contract drilling and the provision of certain ranges all mining equipment and mining services to major mining countries Boart has also established itself as a supplier of a wide range of lungsten carbide and diamond products to industry particularly in southern Africa and Australia During 1976 Boart completed the reconstruction of its overseas holdings and 1977 was a year of rationalisation and reconstruction major acquisitions No durin yeg ar the The consolidated profit interests taxation and minority of the Boart interests shareholders were made after interests R17.50 million for the year to December 1977 compared with R16,41 million the previous year Bruynzeel Plywoods Limited Bruply Brup ya subsidiary of Amic together with its associate companies manufactures veieers plywood blockboard chipboard vencered vencered chiploard doors sawn timber mouldings laminated beams wooden trusses and gumi- poles Year ended December 1977 1977 ROOD'S 1976 R000'S Issued capital ordinary shares - 6749 6749 71 of0 50 cents each fully paid 000 50 50 cents each one cent paid 5,5 per cent cumulative preference shares 000 of R2 each Shaje premium and reserves Loans Net loss income attributable ) do ordinary shareholders Dividends paid preference . : 3.375 2 400 14012 5 697 2424 . 22 = : 3.375 2 . * .400 16442 4033 1421 1421 22 Clay Products Limited AAC Group equity interest'- 15,41 per cent The company operates a factory near Bulawayo Rhodesia producing a wide range of refractory and = earthenware products Year ended March 31 1977 . . 1977 1976 Issued capital 399 000 shares of each 5000's 798 5000's . 798 Reserves 372 Deferred taxation . 390 Fixed assets 686 1.773 Equity earnings 165 . Dividends paid te 100 amounts are expressed in Rhodesian currency 182 100 Computer Sciences Proprietary Limited AAC Group equity interest 21,49 per cent : The company formerly Computer Sciences Sigina - Proprietary Limited offers a wide range of computer - services services through two bureaux A systems development and support service is also provided The company's computer hardware division provides services throught products which include Datapoint Dat^ 100 ITT * Courier Univa~ V series Texas Texas Instruments Comten Consolidated Share Registrars Limited AAC Group equity interesThe company operates 49,67 cent as share transfer secretaries principally to the Anglo American Corporation Group and associates At December 1977 the company acted as transfer secretaries to 80 companies Eastern Transvaal Timber Company Proprietary Limited The company which owns 15 000 hectares of land in the Carolina Waterval Boven and Barberton districts of the Transvaal is engaged in timber growing operations Management of the company's plantationsis undertaken by S.A. Forest Investments Limited : Corporation Highveld Steel and Vanadium Limited AAC Group equity interest 26,39 cent , Highveld an iron steel and vanadium complex in the Transvaal The full ore requirements of both the steelworks and the Vantra division which produces vanadium pentoxide are supplied by Highveld's Mapochs mine at Roossenekal Highveld's subsidiary is major supplier of Proprietary Limited Highveld's Highveld's requirements of ferro- alloys andis an exporter of manganese alloys = Year ended June 30 1977 Heels 1976 R000's : Issued capital 67 770 shares F R1 each * 721 58 186 Share and premium . 27 242 294 provison for deferred taxation Fixed assets co 347 191909 191909 54.8979 54.8979 128 053 Equity earnings Dividends paid = 20.740 158 15 908 7394 Hippo Valley Estates Limited The company produces sugar in Rhodesia Year ended March 1977 2 * citrus and related : oy 1977 5000's products 4 Issued capital 23964 600 shares of Si each ba : 23.965 23.965 7987 Reserves 1976 includes share premium Loans 1976includes deferred taxation Loss profit after taxation 12.066 12.066 12.066 12 784 = . 983 24 069 . 025 = 6 781 Dividends paid _ 302 4 All amounts are expressed in Rhodesian currency Ps bos LTA Limited : Q AAC Group equity interest 31,29 cent The LTA group is one of the largest building and civil engineering groups in southern Africa The activities of the companies in which it interested cover the full building and civil engineering spectrum from small works through to major projects turnkey projects involving the complete design engineering and construction of plant and buildings and also indus trialised buildings the manufacture of prefabricated and building componenatnsd steel reinforcing . com 4 ia we Year ended March 31 1977 Issued capital ordinary shares 12 527 840 of R1 each fully paid 173 50 of0 RI each live cents paid Executive Share 1977 ROOD'S 528 . Wwe 1976 > RODO'S 310 Shaft Sinkers Proprietary AAC Group equity interest 50 cent Shaft Sinkers and its wholly subsidiaries an integrated design and construction service to the mining and civil engineering industries for shaft sinking tunnelling raiseboring and underground excavations Net profits of the group before tax for the nine months ended March 31 1978 were R2 810 000 compared with R2 278 000 for the year ended June 30 1977 under pine gumi poplar sugar cane and phormium The principal operation is the production of tanning extract from wattle bark and are threefactories operated for this purpose products produced in 1977 included approximately 000 tons of timber 000 tons of tons wale bark and 152 000 of sugar cane Net earnings of Natal Tanning for the year ended Decembe3r1 1977 were R1,87 million compared with R2,25 million for the previous year an : yt i i : is i i oy aa a : Incentive Scheme 10 per cent cumulative convertible redeemable pr^'f^'rencsehares - 46 769 of R each Share premium and reserves Long term and deferred liabilities Equity earnings Dividends ordinary oe preference ys 9 . 2 a 47 9 we 52 19053 8726 12 222 407 o 2319 5 680 226 280 268 Mondi Paper Company Limited % AAC Group equity interest 36.65 per cent a. The company operates a paper mill at Merebank \ Durban comprising groundwood mill three high he speed paper machines and a paper finishing The department The company's 260 000 tons produces paperard and felt base paper and Mils operates a sugar mill at Mille Mille in Natal It holds 49 per~ entof the equity of Balamundi S.A. Proprietary Limited which felt base paper for conversion int^ floor felts coverings roofing and dampcourse The companies of the Bowater Associated Industries group which are subsidiaries of Mondi market a wide x range of paper products and manufacture waxed containers and Mondi's equity earnings for the year to December 31 compared 1977 amounted to R10,19 million - millionin 1976 with R8,25 ORFF Lifnited |. ee Sigma Motor Corporation Proprietary Limited AAC Group equity interest 37.00 cent 7 Sigma formed in the second half of 1976 as a result of the merger of Chrysler South Africa Proprietary Limited and Hings Proprietary Limited and is held as to approximately 75 per cent by Group companies and Amic and the balance by Chrysler Corporation of the United States The company markets the Mazda Mitsu bishi and Chrysler range of passenger vehicles wide variety of Mazda and Chrysier light products vehicles The Equipment andTruck markets Komatsu Hitachi Ameise and Mack A sulisidiary undertakes the finanocf ivehnicgle hitepurchase andleasing transactions Soetvelde Limited AAC Group equity interest -49,90 -49,90 per cent . company The was formed in 1969 to consolidate and develop the farming interests of the Anglo American Corporation and De Beers groups in large areas of the Transvaal Orange State northern Cape Its operations include the growing of maize wheat potatoes and other dryland crops and the breeding and fattening of cattle pigs and sheep The company also supplies fresh fruit and vegetables mainly to mining Through its wholly industry Limited Estibsidiary Fresh Foods . Debshan- Vereeniging Refractories Limited AAC Group equity interest 1,73 cent is Vereeniging Refractories a subsidiary of manufctres Anglo American Coal Corporation Limited manufactures a wide variety of refractory bricks materials for the steel alloy and other industries wliere heat is company utilised The also stresed also manufactures buildinbrigcks beams lintels and floor systems Subsidiary and associated companies are involved in the manufacture of concrete rootfiles and vitrified clay pipes and fittings for house drainage and sewers while others mine raw materials used by the group The main works is situated at Vereeniging Year ended December 31 1977 1977 1976 2 R000's R000's Issued capital ordinary shares 5.000 cents each 5.5 per cent cumulative 5.000000 of * . 2.500 redeemable preference shares 500 000 of R2 each 1000 1000 2500 . Be 1000 . Distributable reserves 21048 19 100 Long deferred liabilities . Book value of fixed assets Net current 505 22421 9.089 5.290 5.290 22.164 8.609 Equity earnings Dividends paid ordinary 3.335 , 1 500 3259 500 Rhodesia Dawn Orchards Limited another wholly- owned subsidiary produces tomatoes a range of vegetables and tropical fruits under irrigation the Lowveld ofthe northern Transvaal ah Administered outside the American Corporation Group AAC Group equity interest 37,89 per its extensiveestate in the Groot Drakenstein Valley deciduous fruit for sale on the South African and esport S.A. Forest Investments Limited American The company is a subsidiary of Anglo Industrial Corporation Limited which owns allof equity capital AECI Limited Through its holding in Debincor Amic has an effective interest of percent in AECI markets its own factory It also S.A. Forest Investments group is the largest mining explosives and a accessories produces wine and grapes and pure fruit juice integrated forestry and sawmilling operation in South of plastics heavy chemicals for industrial table wf concentrates concentrates - Africa with extensive timber plantations and and agricultural use vinyl products animal feedstuffs sawmills a His winery completed in 1976 Boschendal factory estate wines under the name name has developed a major rm : piggery and dairy a: , project is a 6 a in the eastern through subsidiaries Transvaal and Natal It is also engage the manufacture of and laminated timber products The Coripany holds through Forest Industries and and Veneers Limited approximately 96 per cent the equity and synthetic fibres Its main factories are situated at Modderfontein Sasolburg Somerset West and Umbogintwini Coalplex the company's based chemical complex se was commissioned in 1977. The which 60/40 Scaw Metals plantations oe Limited of Peak Timbers Limited which owns timber and operates sawmills sawmillsin Swaziland joint venture with Sentrachem Limited produces polyvinyi chloride and a range of chemical products = The company is owned subsidiary subsidiary of Anglo The consolidated loss after taxation of the S.A. Forest at Sasolburg American Industrial Corporation Lind Lind The three major fields in which it operates are ferrous and non- ferrous castings rolled steel products the merchant bar range and grinding media for the mining and Investments group was- R392 000. for the year ended ft December 31 1977 compared with a profit of R2,28 millfi orotn he pr^viouysear Year ended December 31 1977 Issued capital 1977 RODO'S 1976 RO00'S a freight cement industries The cast ferrous railroad components such as include wheels and hogie castings The company also has investments in The Natal Tanning Extract Company Limited| Cardium Holdings Limited in which the Anglo Cordinary shares - 148 336 585 RI each 148 300 5,5 per cent cumulative 137.400 137.400 Corporation Limited 83 Scaw Highveld Steel and Vanadium 4 and American Corporation Group has a 50 per cent interest preference shares 3 000 000 er Ciaster Private Limited holds per cent the capital of Natal Tamming of R2 each 6.000 6.000 6.000 Scaw Equity earnings of the Metals group of The owns or controls 72.000 hectares of Reserves 197 200 163 600 company companies for the year ended December 31 1977 was wattle R16,05 million compared with R14,52 million ^fin1976 forest land in the eastern which is planted mainly to Transvaal and Natal with smaller areas term loans Book value of fixed 202 000 700 191 400 296 200 1977 R000's Unlisted investments Book value 900 Directors valuation 45 000 Equity earnings . Dividends paid - ordinary 37 200 700 AECI's major investments include Proprietary Duropenta Proprietary Duropenta Holdings Limited Prolux Paint Holdings Proprietary Limited Rand Carbide Limited South African Nylon Spinners Proprietary Limited Trionif Fertiliser Proprietary Limited Coalplex Project 1976 R000's 900 63.000 63.000 31.400 21 200 Percentage interest 100 100 68 100 49 60 " completed at total cost of R55,5 million The operation which has a designed annual capacity of 120 000 tons of charge chrome was commissioned in the first half of 1977 w per Cullinan Hadings Limited AAC Group equity interest - 26,37 per tan Cullinan has separate trading and manufacturing divisions engaged in the production of refractories activties electrical and Industrial porcelain products building The bricks and brick panels activities of various subsidiary companies companies include mining and marketing of minerals used mainly in the refractory and other heavy clay and ceramic industries township and property development and the design and marketing of electrical transmission line systems Freight Services Holdings Limited The group operates in South Africa Europe the United Kingdom the United States of America and Australia Its activities include clearing forwarding buying confirming stevedoring ships agency and the servicing of ships and a comprehensive travel service In addition the group has a controlling interest in S.A. Proprietary Container Depots Limited which is the sole customs enfranchised container handling depot in South Africa Anglo American Industrial Corporation Limited an interest of 40,34 per cent in the company has Gallo Africa Limited AAC Group equity interest -10,09 per cen The company its associated associated companies are engaged in the manufacture and distribution of gramophone African Products Limited 31 At December 31 1977 Anglo American Industrial Corporation Limited had an interest of 8.8 per cent in` this company which produces maize starches cornflour dextrins dextrose glucose and other maize products at Germiston Transvaal and owns Maize Products Limited of Meyerton Transvaal and Glucose and Starch Products Limited of Bellville Cape Province Year ended June 30 1977 1977 R000's Issued capital ordinary shares - 019 983 of cents each # 5.5 per cent cumulative preference shares 500 000 of R2 each * Share premium and reserves 4010 1000 13.000 13.000 1976 RO00's 4010 1000 515 records and tapes music publishing and the distribution of television consumer electronic products audio- visual equipment and other related activities Year ended June 1977 Issued capital ordinary shares- shares- 4 658 00of0 25 cems each fully paid 1977 * R000's , 165 1976 R000's 1154 Year ended September 30 1977 . 1977 R000's 1976 R000's Long and deferred liabilities fixed Book value of 10 165 20 206 812 .15.504 162 700 25 25 cents each partly paid six per cent cumulative 17 - 17 : Issued capital 694 ordinary shares of Reach Share premium . reserves term loans and deferred earnings Dividends paid 3.695 3.695 11 427 S 1 442 215 589 . : 3.677 9775 1588 2611 1324 Interests in associated companies fa Investments and loans Equity earnings ~ Dividends paid ordinary 1236 -1898 -1898 2323 042 2320 863 760 1042 Dorman Long Vanderbijl Corporation Limited Dorbyl preference shares 000 of R2 cach 2 Share premium and reserves Long loans and deferred taxation Fixed assets Unlisted investments Book value 300 5 232 4 600 377 554 7 300 4755 4675 472 2067 AAC Groupwo = Dorbyl a steel fabricating and engineering group created Directors valuation 2252 2.067 Chemical Holdings Limited Limited by tile amalgamation of Dorman Long Africa Limited Equity earnings 21 639 738 equity interest - 34,78 per cent and Vanderbijl Engineering Corporation Limited is the foremost heavy steel engineering group in South Africa Dividends paid ordinary 419 Excluding net profit of444 000 ei sale ofinvestment The companies the Chemical Holdings group Its major plants are engaged in rolling stock and i manufacture and market an important range of locomotive construction ship building and ship repair industrial chemical products They also provide expert and mechanical and structural engineering Hall Longmore and Company Proprietary service on the uses of the chemicals and their applica- Equity earnings of Dorbyl which is a 56 per cent held Limited tion in particular industrial fields The products cover a subsidiary of International Pipe and Steel Investments AAC Group equity interest -4,32 -4,32 per cent range of industrial activity including inter alia South Africa Proprietary Liniited were R13.5 million a The and its wholly subsidiary Hall dispersants for the control of oil slicks laundry and drycleaning chemicals for the paper industry for the year to September 1977 1976 1,2 million company Longinore Contractors Proprietary Limited are in the manufacture and distribution of steel detergents and extreme pressure pressure lubricants engaged fittings and other heavy steel products and in Year ended June 30 1977 Engelhard Minerals & Chemicals Corporation ; pipes pipe the construction of pipelines Two other subsidiaries 1977 1976 EMC Corporation : manufacture and distribute drilling equipment and R000's ROOO'S Minorco has 29 per cent interest in EMC the opera- pneumatic tools < Issued capital 104 617 shares R1 R1 vach Share premium and 2 + reserves Loans and convertible notes Equity earnings Dividends paid ~ 105 295 2444 131 559 3.067 *- 701 2703 986 506 Consolidated Metallurgical Industries Limited , : CMI AAC Group equity interest - 15 cent = CMI is administered administered by Johannesburg Consolidated Investment Company Limited It was incorporated in 1975 principally to produce and market charge chrome Structural erection and plant assembly at the company's site at Lydenburg in the eastern Transvaal was tions of which embrace the marketing of ores minerals and metals the mining and processing of metallic minerals and the refining processing and fabricating of precious metals Year ended December 1977 1977 1976 5000's 5000's . Issued capital stock |. 31 common shares 31 821 - S1 each S1 Total shareholders equity Long liabilities Net earnings 000 . 821 683 849 125 161 122 568 31 693 600 330 103.091 124 865 Net earnings per common share - primary ' 3.88 fully diktited 3,72 Dividends paid - common shares 37 948 All amounts expressed in United States 3,99 53.80 988 currency Industex Proprietary Limited The company manufactures various industrial for the tyre rubber and other manufacturing industries spins cotton and synthetic yarns A wholly owned subsidiary subsidiary Union Cotton operates a yarn dyeing Mills Proprietary Limited and weaving plant which manufactures wide range of towelling products and bedspreads Amic holds 37.4 per cent of Industex J.L. Clark and Company Limited AAC Group equity interest - 12,70 per cent a The company and its subsidiaries are suppliers of wide range of heating airconditioning refrigeration and industrial equipment During 1977 the company became a leading supplier of solar water heating'equipment : rn .97 iy geen Pas McCarthy Group Limited AAC Group equity interest - 18,59 per cent The group South Africa marketing areas is the largest retail motor organisation in and comprises various companies each particular vehicle franchises for specified interests The group has extensive property the main are leased to certain of which in trading and operates administrative divisi^ns It also a computer bureau and has subsidiary companies which undertake motor insurance braking the financing of vehicle hire- purchase and leasing transactions and the importation and distribution of motorcycles and industrial engines Year ended June 30 1977 1977 1976 R000's RO00's Issued capital ordinary shares 16 987 415 of 50 cents each 5,5 per cent cumulative - 150 preference shares of R2 each 000 Share premiumvand Long liabilities eserves Equity earnings Dividends paid- ordinary = = 8494 a 8494 300 24 199 321 1.550 1019-29 300 : 3.863 3.863 1444 Middelburg Steel and Alloys Proprietary Limited AAC Group equity interest 8,01 per cent The company which is part of the Barlow Rand Limiteds group owns entire issued share capital of The , Southern Cross Steel Company Proprietary Limited Ste l Southern subsidiaries produce and market steel steel and chromium Equity earnings of Middelburg Steel for the year ended September 30 1977 were R10,5 million 1976 R9.0 million OKK Foods Limited = The company in which the Anglo American Corporation Limited group has a 50 per cent interest is engaged in the manufacture cold storage and marketing of meat and dairy produce in the western Transvaal Orange Free State and western Cape Province Romatex Limited AAC Group equity interest 1,81 cent Romatex is the holding company of an with interests in the production of a large industrial group range of floor coverings and carpet components jute and plastic materials for the packaging and textile industries ropes and cordage knitting yarns components for the motor industry fabrics for the clothing industry and footwear Year ended March 31 1978 1978 1977 Issued capital ordinary shares - 23 499 353 of R1 each R000's 3 23.499 R000's 23.499 5,4 cent redeemable cumulative preference shares 000 000 of R1 each > six per cent redeemable cumulatipvreeference shares 500 000 of RA each Share premium and reserves Long liabilities and deferred taxation Fixed assets Investments and loans _ . 822 11339 11339 51 634 4.073 000 250 935 14 824 53 622 3819 Dividends paid ordinary 3.995 3055 Stewarts & Lloyds of South Africa Limited AAC Group equity interest - 4,09 per cent The company is a 52 per cent held subsidiary of International Pipe and Steel Investments South Africa Proprietary Limited The Stewarts & Lloyds comprises over 30 operating subsidiary companies a total sales volume of more than R200 million The business of the group consists of the manufacture and distribution of welded and seamless steel tube rect- angular hollow sections tubular steel structures pip~ fittings and joints copper plastic and Bundyweld tubes centrifugal pumps valves sluice gates diesel engines irrigation equipmien~fl malleable and grey iron castings and mild alloy steels air conditioning and refrigera- tion con^>ponents and parts mining machinery and ~ ventilation equipment a Year ended September 30 1977 Issued capital ordinary shares - 22 790 533 of 50 cents each per cent first cumulative preference shares - 000 of R2 each Share premium net and reserves Long borrowings cas Fixed assets 7 Unlisted investments at book value - Equity earnings Dividenpdaisd- paid- ordinary 1977 ROOD'S 11 395 600 68 306 30.906 30.906 28 169 99 LF 877 874 1976 R000's 255 600 62 500 30581 24.993 99 122 827 Terra Chemicals International Inc. Bay The company 50,5 per cent owned by Hudson Mining and Smelting Company Limited manufactures nitrogen fertilizers nitrogen feed ingredients at its plant in Iowa in the United States It also has part ownership in manufacturing facilities in Oklahoma which produce ammonia nitrogen fertilizer fertilizer solutions _ and urea liquor and is a distributor of these Company agricultural products During 1977 Terr^purchased of the assets of Riverside Chemical mulator of agricultural chemicals and allied crop protection chemicals ferilizers and other farm : supply products Year ended December December 31 1977 1977 1976 Issued capital stock common shares - 5 305 302 5000's 5000's 1976 5 298 936 of S1 each preferred shares 169 256 1976 169 377 of 100 each 16926 16.938 Total shareholders Gross revenue equity 66 328 109 540 63778 103 346 Net earnings Dividends paid comnion shares 7971 242 11994 11994 3974 All are amounts expressed in United States currency The Tongaat Group Limited AAC Grotip equity interest - 17.85 per cen The company is a major producer within theSouth African sugar industry andis the holding company of an diversified group Its interests include the production and distribution of building materials textiles animal feeds bakery products poultry products mushrooms and electrical and electronic engineering The group's investments include a 24.5 interest in and 50 cent comtrol of Huletts Limited a 28 per cent interest in Hypack Products Proprietary Limited and a 14 per cent interest in _ Gypsum Industries Limited Year ended March 31 1978 1978 1977 . Issued capital ordinary shares - 16 304 R 320 each fully paid 360 000 of R1 each five R000's R000's 16331 16.304 16.304 fernts paid A+ 6,5 per centredeemable cumulative preference shares 000 of R1 each Shate premium and reserves . Long loans reserves Book value of fixed assets 17 ~ 1485 104 765 41415 41415 377 18 650 9714 9714 27-108 27-108 351 Investments at valuation Associated companies Listed 11.092 616 11 102 637 Market value 6887 4637 Unlisted 1175 072 Directors valuation 1175 1072 Equity earnings Dividends paid ordinary 10 760 4085 201 3913 The Union Steel Corporation of South Africa Limited Usco AAC Group equity - interest 2,009 per cem Usco was steel works at Vereeniging whereit produces rolled drawn forged and cast steel products as well as copper and aluminiuin conductors and wite Its wholly- owned Veldmaster Proprietary Limited manufactures agricultural discs and other earth engaging paris A wholly owned subsidiary Usco Aluminium Cor- poration Proprietary Limited operates aluminium electrical transinission cable and conducior plant at Richards Bay Associated companies manufacture aluminium and copper rod and operate as steel nierchants Year ended December 1977 1977 1976 ROOD'S ROOD'S Issued capital ordinary shares 29 010 000 50 of cents each preferent A shares - 125.000 125.000 R2 R2 each preferent B shares - 125 000 of R2 each 14 505 250 250 505 250 : 250 Distributable reserves 811 477 Long loans and deferred taxation 332 21 100 Equity earnings Dividends paid - ordinary 1041 725 5.480 5.480 59t Tiger Oats and National Milling Milling Company Limited Group Tiger TsiugbesridiaryOats equity interest 1,74 per cent is an investment holding company with and associated companies operating in various branches of the food feed agricultural fishing and pharmaceutical industries Its main activities are in maize wheat oats and barley industry edible oil extraction milling the baking the manufacture of margarine and varietoyf grocery products animal teed and pet food production the production of eggs broiler chickens and dairy products bulk handling and ship- ping the manufacture and distribution of pharina- 99 oe a 3 i i > = = | ceutical and allied products and in addition Oceana group of fishing companies can ed the processing thereof into fish oil as well as the processing pelagic fish earnings for the year ended December 31 R22.38 million 1976 R18,83 million through the fishing and 1977 were Uni^nCarriage and Wagon Company Proprietary Limited AAC Group equity interest - 2,79 per cent The company is passenger coaches African Railways the biggest single supplier of railway and electric focomotives to the South and produces rolling stock for sale to other railway authorities and private operators in southern Africa Union Carriage also supplies industrial diesel electric and diesel hydraulic locomotives During the year ended 30 1977 the South African Railways requested extensions in deliveries on contracts which adversely affected profits although the company was left with a reasonable work load Through a subsidiary Unionmod Buildings Proprietary Limited the company has diversified into the manufacture of factory modular bW uildings business district of Johannesburg The Centre is one of the largest commercial building developments in the world and comprises a storey office tower the 30- storey international Carlton Hotel two department stores approximately 170 retail shops and restaurants an international ice rink and covered parking for facilities 2000 2000 cars The Carlton Hotel in which the company has an 89 per cent interest is managed by Western International Hotels of Seattle Year ended June 30 1977 ; issued capital 28 380 332 ordinary shares 50 cents each Share premium Loan capital 8 cent first mortgage convertible debentures 1979/96 . fully paid 81 cent first mortgage nonconvenible debentures 1979/96 fully paid 7 per cent second mortgage debentures 1977/2001 1977 R000's 190 26 33659 58 1976 -R000'S 14 184 139 34.000 - Unlisted investments Equity earnings Dividends paid 18 Months ended 15 Months ended March 31 September 30 1978 1977 ROOD'S RO00's 48.956 48.956 68 908 1187 - 1972 1426 Sorec's major interests follows in completed buildings are as Percentage interest African Eagle Life Centre Cape Town African Eagle Life Centre Krugersdorp African Eagle Life Centre Port Elizabethi African Eagle Life Centre Pretoria Braamfontein Centre Johannesburg formerly Total Centre Checkers Store Benoni Civic Total House Johannesburg Civic Towers House Johannesburg Coca factory Durban Damelin Centre Johannesburg Field North Johannesburg 100 100 100 30 100 100 30 18898282 100 18898282 18898282 9 Property : Administered within the Anglo American Corporation GroupGroup Group Anglo American O.F.S. Housing Company Limited AAC Group equity interest 15.00 cent The company provides housing in the Orange Free State for employees of associated companies At December 31 1977 the cost stands houses flats and hostels owned by the company amounied R27,87 million Anglo American Properties Limited Amaprop - AAC Group equity interest - 48,9 cent . Financial details of Amaprop may be found on page 82 of this report The company's major property interests incompleted property developments are as follows Percentage . interest Amcor House Johannesburg Brickhill Road Parkade Durban Cabana Beach Umhlanga Rocks Carlton Centre Johannesburg 100,00 100,00 100,00 29.90 fully paid : Unsecured loans Operating profit Equity earnings . Surplus arising from purchase and cancellation of cent debentures . _ Accumulated loss 600 13288 6.000 878 10.000 130 6373 782 7.1 627 7079 Kenilworth Centre Proprietary Limited AAC Group equity interest 81,43 cent The company operates a regional shopping complex in the southern subou f Cr apeb Tos wn centre Orange Free State Land and Estate Company Proprietary Limited OFSLE OFSLE which is a wholly subsidiary of Anglo American Industrial Corporation Limited owns 11.000 11.000 hectares of land in the Orange Free State and western Transvaal well as the rights to a proportion of licences and mining lease remals over an area of approximately 19 000 hectares The compala so n owy ns 19 trading sites in the same areas and is participating in the development of residential townships the Welkom and Allanridge areas of the Orange Free State OFSLE has interests in O.K.K. Foods Limited 50 per cent and Soetvelde Farms Limited 19 per cent a SorgSorege Limited Limited Gardens Centre Cape Town Highpoint Hillbrow Johannesburg Highrise Johannesburg . His Majesty's Majesty's Johannesburg- Killarney Mall Johannesburg Life Centre Johannesburg Lloyds Building Johannesburg . Opera Plaza Pretoria Sandton City Sandton x Sanso Centre Cape Town Shell House Cape Town Sunnypark 111 Pretoria Commissioner Street Johannesburg Johannesburg formerly African Life Centre 18898282 18898282 18898282 18898282 18898282 18898282 18898282 18898282 20 70 25 51 15 Administered outside the Anglo American Corporation Group Main Place Holdings Limited [ AAC Group equity interest - 27,95 per cent Main Place administered by Johannesburg Consolidated Investment Company Limited is the holding company of 15 wholly subsidiary companies which own 4.53 hectares of land west of the Magistrates Court adjacent to the financial district of Johannesburg The land is being held for future development Devonshire Hotel and Devonshire House AAC Group equity interest - 55 cent Johannesburg Durban 100,00 54,05 Sorec is a property investment company with interests and Durban Bay House and Edura Johannesburg 100,00 mainly in prime shop and office developments Insurance banking Finsbury township Randfontein 100,00 sububan shopping complexes in South Africa * 2 La Lucia township Natal 55,00 18 Months 15 Months general investment Prospecton Industrial township Durban 50,00 ended ended ee Marina da Gama Muizenberg 50,00 March 31 September 30 Muckleneuk and Welgelegen Pretoria 100,00 1978 1977 Provincial House and Durdoc Centre Durban 51:40 RO00's 1000's Administered within the Transvaal House Pretoria Umhlanga Beach Mews Umhlanga Rocks 320 West Street Durban 100,00 100,00 100,00 Issued capital ordinary shares - 21 of R1 each 938,695 21939 21.939 Anglo American Corporation Group ordinary deferred D shares 558 560 of R1 each 558 . 558 African Eagle Life Assurance Society Limited Carlton Centre Limited AAC Group equity interest 49,98 per cent The company owns the Carlton Centre the central Share premium and reserves : Loans Fixed assets 39_939 agit. 38819 56 860 60 464 AAC Group equity interest - 75,00 per cent is The company one of the largest South Africa offering a comprehensive assurance assurance groups in comprehensive flexible range of 100 xP ih at : linked life assurance plans African Eagle Life is also a leading underwriter and innovator in the group pensions market Operations of the group extend throughout South Africa Rhodesia and South West a Distributable reserves Listed investfients 1977 ROOO'S 795 1976 R000's 2 79 N : 272 of 10 cents each one cemt paid 1977 RO00's RO00's 43 1976 R000's 43 Africa and include the marketing of industrial life At COST 1693 1675 six per cent cumulative preference business densely in i in the more populated areas Market value life companies are Guarantee Life Assur- Equity earnings 506 295 4.798 303 = 375 000 of R2 each Share premium and reserves 750 517 750 312 150 As urance ance Company Limited and Southampton Company of Rhodesia Limited Guarantee Assurance Life con- Dividends paid 291 300 Long term liabilities and deferred taxation 227 142616 142616 centrates on providing sophisticated services in the field of life assurance exclusively through brokers It offers 3 wide range of life assurance products including Western Ultra Deep Levels Limited AAC Group equity interest 60,23 cent Book value of fixed assets of Excess of market value listed investments and of directors 457 260 those linked to property equity fixed interest cash and managed portfolios Southampton Life full range of life and pensions products in Rhodesia The company is the holder of mineral rights over an area of 613 hectares comprising portions of various farms in the Potchefstroom district of the Transvaal Of these valuation of unlisted investmens over book value Equity carnings 690 145 50545 72818 A wholly subsidiary Eagle Property rights 2 104 hectares are included in the mining lease Dividends paid ordinary 543 329 Holdings Limited deals in property investment and area of Elandsrand Gold Mining Company Limited development African Gold and Base Metal Holdings Limited The company holds shares in East Driefontein Gold Mining Company Limited Western Deep Levels Limited and Elandsrand Gold Mining Company Limited C.T. Bowring and Associates Holdings South Africa Limited AAC Group equity interest 50,00 per cent Fok i i i t 4 a ^' 1 5 AAC Group equity interest 100 per cent The company holds mineral rights over number of in a farms South Africa It also majmoajr or interest in The Afrikander Lease Limited and throughits owned subsidiary Pintail Investments Limited it has an interest in Rustenburg Platinum Holdings Limited Anglo American Rhodesian Development ~ Corporation Limited The company's main source of income is the leasing to the Rhodesia Railways under term agreements of rolling stock originally purchased for 15.5 million In addition it administers as independently operating divisions divisions the Mazoe Citrus estates near Salisbury and substantial forestry estates in the Eastern Highlands First Consolidated Holdings Proprietary Limited AAC Group equity interest 100 cent The principal activity of the company is the provision of instalment credit facilities and medium finance A Administered outside the Anglo American Corporation Group Barclays National Bank Limited Barclays AAC Group equity interest 12.67 per cent Barclays througthrohugh provides a comprehensive throughout approximately 1000 offices banking servicesouthern Africa The main function of Barclays is commercial including international trade finance foreign dealings business development and suplemnted com- imesubsridiarcies ial intelligence These services are supplemented by in merchant banking hire and pension pension schemes Year ended September 30 1977 Issued capital 53 234 011 ordinary shares of R each 1977- ROOO'S R000's 234 234 Through various subsidiaries and associated companies thecompany conductsinsurance broking operations in the Republic of South Africa South West Africa and Swaziland Year ended December 1977 capital Issued capital ordinary shares - 50 000 of RI each A class cumulative preference shares - 2 of R1 vach B class cumulative preference shares - 2 of RI Shaprreeference cachipremium and r^'serves Equity earnings Dividends paid - ordinary -preference -preference 1977 ROOD'S 1976 ROOO'S .50 50 - R2 & R2 .491 1084 980 226 R2 R2 388 878 790 220 NO Gold Fields of South Africa Limited 4 subsidiary company First Consolidated Leasing and . Reserves 174 962 AAC Group equity interest 3,31 per cent , :4 of mFoinvanacbe lCeorapsosreattsion Limited specialises leasing Total assets Equity carnings Dividends paid 5 974-4639 974-4639 974-4639 A mining finance and exploration company with 33 708 760 substantial holdings in gold and uranium mining a 12.244 10114 companies base mineral industrial and property Mainstraat Beleggings 1965 Eiendoms Beperk AAC Group equity interest 30,00 per cent Mainstraat was formed by Anglo American Corporation Mynbou and the Federale investing Mynbou Mining group for the purpose of investing principally in the fields of engineering and" heavy industry The company has Bard Discount House Limited The company is a registered discount house incorporated in Rhodesia Profit after tax for the year ended August 31 1977 was KS355 000 1976 RS312 000 companies Year ended June 30 1977 ' Issued capital 16 301 477 ordinary shareosf 25 cents each 1977 R000's 1976 R000's 4.075 4075 interests in Highveld Steel and Vanadium Corporation Barlow Rand Limited Share premium and reserves 146 787 Limited Hall Longmore and Company Proprietary Limited International Pipe and Steel Investments South Africa Proprietary Limited Stewarts & Lloyds of South Africa Limited Union Carriage and Wagon Company Proprietary Limited and Unionmod Buildings Pro+ prietary Limited New Central Witwatersrand NCW Witwatersrand Areas ? Limited 25.01 AAC Group equity interest - 8.42 per ceni A South African mining and industrial finance and investment company which heads a group comprising a large number of subsidiary and administered associate companies operating throughout southern Africa the United Kingdom and the continent of Europe The principal interests and activities of the group include primary and secondary manufacturing mining and exploration property investment and the distribu- Investments Listed - Book value Market value Unlisted - Book value Directors valuation Equity earnings - Dividends paid 919 898 531 448 546 5832 5832 448 21733 17932 5318 900 694 '262 of a AAC Group equity interest - 25.01 per cent administered NCW is an investment company byby Anglo American Its main interests are in mining tion and merchandising diverse range of products to all sectors in the various economies it serves Year ended September 30 1977 1977 ' 1976 Hollandstraat Beleggings Beperk AAC Group equity interest 49,00 per cent Corporation finance and mining companies A C F . + ; Year ended June 30 1977 it \ wo capital i shares- Issued 1977 RDOO'S 1976 R000's Issued capital ordinary 102 367 306 shares- 10 cents each R000's R000's This investment company which is subsidiary of Federale Mynbou Beperk was formed in 1963 Anglo American Corporation and Federale Mynbou has a substantial shareholding in General Mining and Finance 50cms yy of 1 766 396 shares of cms each 833 833 fully paid 10 236 132 Corporation Limited ; 101 : * a tte 5 >. ee a eT ee me Se < International Pipe and Steel Investments t= South Africa Proprietary Limited IPSA AAC Group equity interest 5,70 per cent PSA is thej holding company for two subsidiaries Dorman Long Vanderbijl Corporation Limited Dorbyb in which it has a 56 per cent interest and Stewarts & Lloyds of South Africa Limited in which it has a 52 per cent interest Details of Dorbyl and Stewarts & Lloyds on appear pages 97 and 99 respectively of this report call loans from banks building societies and mining houses for subsequent investment in range of domestic short securities and contributes to making active marketsin the securities whichit invests Equity earnings for the year ended December 31 1977 were R1,56 million compared with R1,36 million the previous year Nedbank and Syfrets Holdings Limited AAC Group equity interest - 1,75 per cent The company a holding company operating through a number of subsidiaries which cover the whole spectrum of banking and financial services Year ended September 30 1977 : | Issued capital : 85 860 shares of R1 each 1977 ROOO'S 1976 R000's fully paid of 4417 shares R1 each partly paid j premium Share Total and reserves 85 860 85 860 85 92 642 2849 619 5 77.232 2546 632 Equity earnings Dividends paid \ 591 15.455 355 167 if Standard Bank Investment Corporation Limited Stanbic AAC Group equity interest 0,47 per cent Prospecting Administered within the Anglo American Corporation Group Anglo American Prospecting Company Limited AAC Group equity inter^'st - 95,00 per cent The company is engaged in the financing of prospecting ventures countries outside South Africa Anglo American Prospecting Company South Limited AAC Group equity interest 95,25 cent The company entered into an agreement in 1975 with Aquitaine S.W.A. and Canso Oil and Gas fic for the purpose of prospecting for oil off the west coast of South Africa Through a number range wholly whollyowned subsidiaries Stanbic offers Anglo American Prospecting Services fields of comercial chase and block investment participation niortgagefacilities ment and mortgage and facilitiesinsurance services Year ended March 1977 H 1977 i R000's Issued capital invest- 1976 R000's Proprietary Limited AAC Group equity interest 95,00 cent The company engaged in prospecting operations Africa behalf of associated and other companies in South and South West Africa Minsearch Surveys Limited ordinary shares - 52 721 297 of RI each ; ah 721 029 Hudson Bay Mining and Smelting Co. Limited and its associates have 70 per cent interest in this company 61 per cent first cumulative preference shares - 8 000 000 of RI each F 8.000 with the balance owned by Barringer Research Limited was formed in 1974 to undertake the developinent of * 8.000 Barringer's Ainrace airborne geochemical survey Share premium premium and distributable reserves L Total assets earnigs earnigs Equity earnings Dividends paid ordinary i ; 123 683 153913 524 . 862 103.033 103.033 3910 927 131 Tanganyika Concessions Limited AAC Group equity interest 3.19 cent The company which is incorporated in the United Kingdom interests in holding company with its principal * Union Mini^reS.A a mining and explora- tion company operating in various parts of the world andthe Benguela Railway Company which ow^"sthe linking Angola Za^flre and Zambia Other system Prospecting Ventures Limited This c^mp^nwyhich is registered in Rhodesia carries out prospecting operations in that country on behalf of the Corporation Corporation and associated associated companies Swakop Exploration Proprietary Limited The company holds a prospecting grant over 28.000 landin South West Africa where prospecting source material is being carried out significant interests include 59 per cent of Elbar Indus- trial Limited which deals mainly in the manufacture distribution and of agricultural machinery and 50 per Oil and Gas Limited which is involved in explorationfor oil and gas in the North Sea i : The Discount House of South Africa Limited AAC Group ^'quityinterest 20,70 per.com As a registered discount house , the company negotiates Service Administered within the Anglo American Corporation Group Anmercosa Computer Services Limited AAC Group equity interest 100 per cent The company has branches in Johannesburg and Welkom It provides a bureau and software development and support service from its offices located in Welkom The gold mines associated with the Anglo American Corporation Group the major users of these services In Johannesburg computer consultancy services and support are provided to Group users including technical data processing for the Coal Division Anglo American Corporation Botswana Services Proprietary Limited AAC Group equity interest - 100 per cent administration The company is responsible for the the American Anglo Corporation and De Beers group companies domiciled in Botswana and operates from Botsalano House an office building in Gaborone owned by an associated company West Proprietary Limited End Property Company Anglo American Property Services Proprietary Limited AAC Group equity interest - 100 per cent The company provides technical management and administrative services to poup^'rty companies within and associated with the Anglo American Corporation- Group ae Mine Services O.F.S. Proprietary Limited supplies The company stores and materials to gold mining companies the Orange Free State and the Transvaal associated the Anglo American Corpora tion Group . 102 agnd i Special resolutions passed by subsidiary companies Change of name . Africin Hawk Eagle Holdings Listed from African Hawk Eagle Proprietar Booted Eagle Holdings Limited Limited from Booted Eagle Proprietary Limited Ferrobar Holdings Limited from Ferrobar investments Limited Limited Martial Eagle Holdings Limited from Acme Project Purlined Holdings from Purlined International Civil Contractors Limited Taybard Holdings Linified from Taybard Investments Limited 3 Oe Conversion from private to public company African Hawk Anseld Holdings Booted Eagle Holdings Limited Control Logic Holdings Limited Engelhard Enterprises of Southern Africa Limited Eurango Limited Properties Limited ana! Martial Eagle Holdings Limited American Rand Investments Limited financial year end to March 31 Change Anglo American Investment Trust Limited Bermuda ._ Anglux Limited S.A. aN . Anseld Canada Limited \ Axalux Holdings Limited # Capstan Holdings Limited Cello Securities Limited < < Crucible S.A. Flagstaff Holdings Limited Gallic Holdings B.V. Georgic Holdings N.V. Keystone Holdings Holdings Limited Lighthouse Investments Limited S.^ . Jolding S.A. Orlop investments Limited Osier Holdings Limited Park Holdings Limited Pinion Holdings Limited Rand Luxembourg Limited S.A . A cara Amendments to Articles of Association Anglo American Base Metal Holdings W.A Proprietary Limited Anglo American Property Investments Limited Anseld Holdings Limited a Bay Passage Investments Limited Earangle Limited Exchange Buildings Proprietary Limited Kaffrarian Metal Holdings Proprietary Limited Rand Selection Corporation Limited South African Mines Selection Limited South African Townships Mining and Finance Corporation Limited Change in capital structure African Hawk Eagle Holdings Limited Anglux Limited S.A. Anseld Canada Limited Anseld Holdings Limited Cello Holdings Limited Securities Limited Coriander Holdings Limited Egret Investments Limited Engelhard Enterprises of Southern Africa Limited Eurango Limited Lodestone Holdings Limited L.S. Properties Limited Marjorain Holdings Limited Eagle Martial Holdings Limited Oriole Investments Limited Pintail Investments Limited Purlined Holdings Limited Rand American Investments Investments Limited Rand Luxembourg Limited S.A. Rand Selection Corporation Limited Randsel Investments Limited Rhochar H^ldingsLimited Thaton Limited Amendments to Memorandum of Association African Hawk Eagle Holdings Limited 5 Bay Passage Investments Limited Booted Eagle Holdings Limited Ferrobar Holdings Limited Martial Eagle Holdings Limited Adoption of new Articles of Association African Hawk Eagle Holdings Limited Booted Eagle Holdings Ferrobar Holdings Natal Coal Syndicate Proprietary Proprietary Roy Braakfontein Colliery Limited Shareholdings The interests of the present directors and alternate directors in the shares of the Corporation at March 31 1978 appearing in the register of the interests of the directors in the shares of the Corporation are set out below There have been no changes between that dat^' and June 23 1978 Non- Option bene Beneficial to Directors Beneficial ficial acquire Sir Keith Acum SN 42 609 Dr M Atmore WG Boustred 000 30.000 30.000 100 100 6.000 9.000 9.000 Directors BE Bullett GA Smith JN Clarke HK Davies Dr ZJ de Beer Dr B Dyer Etheredge CJ Grillith EP Gush WJ Hefer DB Hoffe MB Hofmeyr JA Holmes FJA FJA Howard JD Johnson A Johnstone W King OP OP Koevont Koevont PJR PJR Leyden DE Maciver JLP Mackenzie AB McKerron CDM Melville Dr LG Munsh DG Nicholson O'Dowd HF Oppenheimer NF Oppenheimer Sir Philip Oppenheimer W Pain GW II Relly Sir Alben Robinson MW Stephenson LG Stopford Sackville JD J Ogilvie Thompson GH Waddell VI Webber A Wilson WD Wilson Beneficial 10.000 15.000 15.000 Option to acquire -- 5.000 _ 1000 30.000 30.000 15.000 100 1.000 7.000 400 028 100 4.000 000 30.000 30.000 1.000 7.000 8.000 4.500 10.000 30000 30000 100 ~ 30.000 30.000 1000 100 9.000 9.000 9.000 700 150001-000 150001-000 000 1.000 300 6.500 7.500 30.000 3.600 3.600 30.000 30.000 15.000 15.000 15.000 15.000 1.000 : 100 100 10.000 2.000 - 3.000 15.000 100 4.000 2.000 15.000 100 _ 54 15.000 30.000 100 100 5.000 15.000 000 _ 100 3.000 7000 15.000 500 10087 a 15.000 15.000 100 5.000 6.000 15.000 = 6.000 200 30.000 15.000 18 333 268 includes 565 350 100 7.000 1.000 4.500 ~ registered 18 333 268 _ _ includes 100 registered 3.200 1000 _ 195 430 _ .100 ~ 30.000 1000 18.000 18.000 15.000 15.000 - . 1.000 100 = 9.000 _ 15.000 30.000 > 1.000 14.000 18 333 268 _ _ includes 000 registered 15.000 15.000 7.000 000 41.060 000 10.000 10.000 2380 2380 The Corporation is not aware of the extent any the directors family interests i Shares Indrecopanial Indrecopanial ole beneficiary HEAD OFFICE 44 Main Street Johannesburg 2001 PO Box 61587 Marshalltown 2107 Telex 7167 Telephone 838-8111 Managing Secretary JT JT Goldfinch OFFICES Australia Australian Anglo American Limited 500 Collins Street Melbourne Telex 30728 Telephone 622141 SecretaryJE JE Clark Bermuda Anglo American Investment Trust Bermuda Limited Belvedere Building Pitts Bay Road Pembroke Telex 3348 SPECT BA Telephone 51255 Secretary D F Ellis Botswana |. Anglo American Corporation Botswana Services Proprietary Limited Botsalano House The Mall Gaborone Telex 410BD Telephone 2202 Secretary A V Waterston Brazil 1 Anglo American American Corporation do Brasil Limitada Araujo Porto Alegre 36-20000 de Janeiro R.J. ZC00 Telex 2121723 AACB BR Telephone 2446355 ' Secretary N Lima y Canada Anglo American Corporation of Canada Limited PO Box 28 Dominion Centre Toronto Ontario M5K 1B8 Telex 6524372 Telephone 3622192 Senior President - Administration _ Secretary Secretary and General Counsel K Taylor QC France Charter France S.A. 9 Rue de Vienne Paris 8e Telex 280406 Telephone 5225484 Secretary RS Robertson Luxembourg Anglux Limited S.A. 50 Route D'Esch BP 459 Telex 2234 Telephone 40161 Secretary D. P.Paton Portugal Anglo American Corporation de Portugal S.A.R.L. 244 Avenida Da Liberdade Lisbon Telex 18316 Telephone 561126 Secretary A Viera De Castro 104 Rhodesia 70 Jameson Avenue Central Salisbury C.4 Telex 4113 Telephone 704461 Managing Secretary Rhodesia G T Bain United Kingdom 40 Holborn Viaduct London EC1P 1AJ England Telex 27529 Telephone 3531545 London Secretary D Booth Zambia " Anglo American Corporation Central Africa Limited 74 Independence Avenue Lusaka Telex 41190 Telephone 53000 Secretary M Casey-Casey- SHARE TRANSFER SECRETARIES Consolidated Share Registrars Limited 62 Marshall Street Johannesburg 2001 PO Box 61051 Marshalltown 2107 Charter Consolidated Limited PO Box 102 Charter House gy! AD Park Street Ashford ; Fes Kem TN24 8EQ England einen ny a Members of the Corporation who wish to receive copies of the annual reports and accounts of quoted companies associated with theCorporation may obtain them upon application to the Managing Secretary or to the Loudon Secretaroyf the Corporation Changes of address should be notified to the Corporation's transfer secretaries Printed by Honors Printers Johannesburg Statement by the Chairman Mr HF Oppenheimer A a od To be read in conjunction with the Corporation's annual report for 1978 The accounts for the fifteen months ending March 31 reflect for the first time the effects of the merger with Rand Selection Corporation which became effective from January 1 1977. The figures are therefore not comparable with those in the last report and accounts which dealt with the year 1976. The net equity earnings for the period under review amounted to R195 million or 89,9 cents a share If account were taken of the Corporation's share of the undistributed profits of those companies in which it or its associates directly or indirectly hold 20 per cent or more of the capital or which are administered in the Group the declared and underlying carnings for the fifteen months would total about 178 cents a share Ordinary dividends totalled 25 cents a share which is equal to 50 per cent of the declared earnings or 25 per cent of the declared and underlying earnings 0 in A special charge of R33,5 million has been made in respect of our investments in Soci^'t^'Mini^rede Tenke Fungurume SMTF and Botswana RST BRST which means that these investments up to March 31 have been provided for in full The large losses incurred BRST have been due partly to very low metal pric partly the subidary unforeseen technical difficulties mining subsidiary BCL Good technical progress wa last year and production has consequently increas Nevertheless the mine will not be able to operate economically until nickel prices improve and at pres~ m profits on a scale to justify our large past investment cannot be foreseen The financial structure and sales arrangements of BCL have recently been reorganised the following negotiations between the principal Share- holders the Government of Botswana and the major lenders I am confident that the term viability of the project has been enhanced by this restructuring which will effectively reduce the company's debt burden and improve its cash flow The situation ^fin respect of the SMTF deposit in the Shaba province of Za^flre somewhat This is a large grade copper orebody which work had be suspended early in 1976. While its prospects are again being examined it obvious that in addition to very real improvement in the copper market major econ^micchanges and the establishment of peace and stability in Shaba would be necessary before any largescale development of the mine could be considered the circumstances we_regarded we_regarded it as essential to make full provision against our investment though naturally we hope that the time will come when it will be possible on some new basis to turn this considerable mining opportunity to account 4 The exceptional difficulties being experienced by the South African economy which I discussed in my last statement.continued statement.continued to be felt throughout the period under review Inflationary conditions and pressure on the balance of payments resulted early in 1977 in the a application of still more restrictive monetary policy This was successful in bringing about a surplus on current account but this advantage was offset by a large outflow of -capital mainly attributable to political anxieties In these circumstances the economy stagnated and unemployment a took on worrying proportions state of affairs that further reduced the confidence of foreign investors and multiplied the problems of the Treasury and Reserve Towards the end of 1977. however a slightly better Bank became evident due in the main to a very good trend Cagricultural season improved mineral exports and the higher price of gold Accordingly the Minister of Finance was able this year's budget to provide some cautious stimulation the economy and there is now reason to believe that the recessionary phase has come to an end This is time feel when some boldness is called for on This The part of the government and monetary authorities and insofar as it becomes possible the private business sector also Though thebeginning of recovery is now perceptible it is still a delicaf^' plant and we must be careful not to sinother it before is properly established by continuing to apply a restrictive policy after the need for it has gone Risks to the balance of payments are course involved but the risks of economic stagnation and further unemployment seem me to be greater still a More than once the Prime Minister has said in Parlia ment that the thing he would fear most in South Africa would be scale unemployment particularly of blacks The Prime Minister's concern certainly fully justified justified in the particular circumstances of South Africa effects of a low growth rate over an extended period would be likely to take the form not so much of massive unemployment in the towns as of massive under- employment in Spandau of the impoverished University of r^"ral areas Witwaersnd Professor the Witwatersrand Witwatersrand has recently estimated that the p^rcapita income of blacks in the homelands is less than half the average for blacks in Soweto With a black population growth of about 2,6 per 7 cent a year it plain that if the modern sector of the economy does not grow at a rate sufficient to absorb new entrants to the labour market the pressure of popula- likely in rural areas is judged to be less to semployment social unrest than massive unemployment in the cities If boycott did in the long run produce change in tion dependent on subsistence economy in rural areas would become very serious indeed While the average real per capita income of blacks in urban areas has risen rapidly since 1970 there is unquestionably serious poverty at the lower end of the scale For social reasons therefore it must be unacceptable even if it were technically possible - to reverse the trend towards more capital- intensive industry in order to prpovaidye larger numbers at lower rates of employment for On the contrary human considerations make it dneocessary becomes economically possible as and when it so to raise minimum wages to conform with the standards of the more pro- gressive and prosperous firmswhowho have accepted the Minimum Living Level as their guide Thisis by no means an easy thing to do all circumstances and certainly it would not benefit anyone to raise wages further if the South Africa it could only be violent change induced by the sufferings that it would have inflicted on black people It is difficult to believe that any end could justify such means and particularly so when the opposite policy of stimulating economic growth must bring about major improvements in the opportunities conditions of employ- ment and wages of the black workers Such developments would almost certainly also lead to the more rapid elimination of racial discrimination particularly in the highly sensitive areas of education security of tenure and in regard to the harsh restrictions that exist on the move- ment of black workers ss is my belief however that the efforts of those advocat ing an economic boycott on moral grounds have played and play only a minor part reducing the level of overseas investment If overseas investors have been effect were to close mines and factories and add materially to the number of unemployed However there comes unwilling to put money into SouthAfrica it is not generally speaking for moral reasons but because of their a stage in the development of any country at which the trend towards a more intensive economy is appraisal of the instability to which they would be exposed by political factors This anxiety was sparked off by the 4 | * necessary and irreversible and the possibilities of sustaining economic growth on a wage intensive basis become exhausted Africais certainly in that stage events in Soweto in 1976 and it was powerfully reinforced by the strong world reaction to the Biko affair to the banning of the leading black newspaper and the detention All these considerations point to the conclusion that massive unemployment or employment will not be avoided and social stability will be at risk unless the South of number of important people last October Obviously too political anxieties are going to have a much more decisive effect at time when the economy is in a period of African economy can resume a rapid rate of growth The material and human resources for growth on an adequate scale are certainly there bin they cannot be turned to account unless the necessary investment capital is made recession There can be little doubt that in the circumstances of the last two years the government's cautious and restrictive fiscal and monetary policies were right and unavoidable If persisted in too long however they could available This cannot be found in full from local sources and the country's greatest need is therefore a renewed inflow of investment funds on a large scale from overseas result in our economy being structured structured that a surplus on current account was secured not just as a temporary expedient but on permanent basis by restricting domestic It is just because prosperity and stability are at this juncture so dependent investment from abroadabroad thai many individuals and groups wlio disapprove of the country's official race policy b^'lieve that an economic boycott - only it could be m^deeffective - would force South Africa change that policy radically I have little doubt that in practice the immediate effect of any such boycott would not be to cause the government to change course but to tighten control over the flow of blacks from rural areas to the towns for the reason that under- spending and therefore the growth of the economy to an extremely low level We have now as 1 believe.moved believe.moved believe.moved to stage in which economic policy can and should be directed primarily not to consolidation and survival survival but to growth consolidation and prosperity expanding economy would in itself be an encouragement to overseas investors and by reducing unemploymem it would lessen the risk of social unrest and allay anxieties about our political situation Naturally such policy decisions cannot precise calculation and in their nature be matter of human judgement which is in- 5 i : : : . , , : | . : : ; < . : . . evitably fallible is involved There comes a time however when excessive caution is not the safe but the dangerous course and I am convinced that we should now seek to strengthen the balance of payments not by the negative measures we have been using but more positively by > devising specific of encouraging foreign investment over and above the normal attractions that a stable and growing economy offers the investor While the expansion of the economy so as to provide job opportunities and improve the standard of living depends in the first place on a higher level of investment it would be quite impossible to achieve if industrial relations were not on sound basis This whole field is now under consideration by the Wichahn commission whose report is expected later this year One of the most important questions with which the commission must be concerned is that of black trade unionism Trade unions are an integral part of the free enterprise system in South Africa and throughout the West Those of us who are committed to the extension of this system should see the inclusion of black workers in the trade union movement as a healthy and desirable development Black trade unions are of course not forbidden by law their membership has been -increasing to a considerable extent and like the economy as a whole their growth will be stimulated by a higher level of investment However black trade unions are * recognised in terms of the industrial conciliation act and the government has far preferred to support the establishment of work and liaison committees Though these committees certainly served a useful purpose 1 remain of the opinion that they can only be an interim expedient Whatever their merits may be in the long run it is going to be quite impossible to persuade the black workers that collective bargaining which is accepted as an essential part of industrial organisation around the world and is regarded as right and necessary for white workers in South Africa should not be applicable to black workers And no form of labour organisation which is not in accordance with the wishes of the workers themselves is going to function satisfactorily As and when black trade- unions emerge which are properly conducted and reason- _ ably representative we should certainly be prepared to recognise not and negotiate with them even though they may be recognised in terms of the legisla- in tion There have been other encouraging developments in the labour field in addition to the appointinent of the Wichalm commission Earlier this year the Minister of Labour withdrew or suspended determinations affecting most of the ^ccupationsstill subject administratively to job reservation Recently too in terms of an agreement negotiated by the National Industrial Council for the fron and Steel Industry a body which is representative of 400.000 workers of all races job reservatiohnass been scrapped and training opportunities opened up to all so that in this very important industry it is now possible to promote workers and offer them terms of employi^-ent that are in no way connected with race Progress is being made EP iy GOLD AND URANIUM The strength of the gold market in face of the additional arising from the United States auctions is encouraging The trend is the more welcome because costs are continuing to rise an average rate for Group mines about 15 per cent above last year While this primarily inflation the result of the general it is aggravatebdy the increasing distance of working faces from the shafts leading to more extensive travelling haulage and service requirements and older mines by the difficult con- ditions encountered in extracting remnants Considerable ceffort is being devoted to the problems of improving productivity in these circumstances In capital costs the rate of escalationis lower than has been for some years dug the keen competition for heavy engineering busi- ness Nevertheless the increase cominues to be matter of concern in relation to the very large sums- sums- totalling some gold R2 billion - thatthe industryis investing in new produc tion facilities If and uranium prices stabilise at present levels 1 believe that capital expenditure will fall from the beginning of the1980s when the mining eward industry will start to reap its fact the first of the new mines will shortly start producing and a year from now there should three new m^fines- Unisel Deelkraal and Elandsrand - in their early months of production When the decision to establish Elandsrand was taken 1974 was scheduled to operrin 1981 am pleased say that determined leadership and technological innovation have brought the date forward by two years Ergo has come into operation this year and should in full production by the end of 1978 The uranium market has remained firm during the last year The suspension of contracts by the Canadian = i oe government and the still uncertain position of uranium production in Australia have narrowed the sources on which consumers can call and South Africa which has a level This was attributable principally to the continued growth in demand for diamond jewellery but also to a new and unhealthy element of speculative trading reputation for meeting its contractual obligations has reflected in the substantial premiums over the CSO's benefited In the last 18 months South African producers selling prices that were being paid in the secondary have been able to sell large quantities of material on market quite unrelated to basic consumer demand The medium- and term contracts many ofthese contracts established policy of the CSO is to set its selling prices at provided consumer finance so greatly casing the impact level that it believes can be maintained on a terin on shareholders of the costs of new production facilities Production fromgold mines in the Anglo American Group quickly is being being stepped up and the position is not far off when of Group will be supplying half of the uranium producedin the country = basis and to raise them when it is satisfied that a new ~ level is justified in relation to retail demand To discourage speculation and in the meantime enable the producers to benefit from the prevailing premiums the CSO announced in March 1978 that at the time of each sight it would Labour relations during the year have been generally peaceful with the exception of the recent unrest at ? one shaft of President We have made further progress- inform its customers of surcharge to be added to the basic p ice until a sounder relationship had been restored between the market prices of rough and the prices of in implementing the Group's policy of improving the polished diamonds at retail level I am glad to say that in black earnings earnings living conditions and productivity of our employees O| ur aim is the elimination of race as a factorin determining wages conditions ofemployment large measure this has been achieved and that has been possible to reduce the amount of the surcharge from the 40 per cent imposed at the March sight to 10 cent in July For two years now the industry hasbeen able to maintain The imposition of the surcharge was accompanied by somes somes * its black labour force at full strength has become reduction in the volume of diamonds offered to the less dependent on foreign foreign workers However we are still market As a result the CSO's sales in the first half of 1973 not satisfied that our systems of manpower planning as at R1,064 R1,064 million though 24 per cent higher than in the ; sophisticated and flexible as they need to be to provide second half of 1977 were slightly lower in volu^flnewhen management with the best in manning efficiency and waccount is taken of the increase in prices last December assure the migrantwhois prepared to plan his work cycle The net attributable profits of the De Beers group m^re- that he will be employed throughout the highest level of than doubled during 1977 R623 million and the total ' skill andcarning power our desire to achieve a more stable labour force we are planning to reduce the ~ proportion of migrants by providing more of our senior = workers = as we now permitted to with family accommodation in mine villages or nearby townships Indeed major housing programmes are in hand for all the Group's mines good progress is being made We , shall not however be able to move as far and as fast we would like to do in all such matters affecting the welfare deferred dividend was raised by 50 per cent to 52,5 cents deferred share The group is carrying through the largest expansion programme in its history opening new mines and extending existing ones in South Africa and Botswana Ahogether the De Beers group has never been more active and innovative isnotvatirveesses have their and though the years ahead will no doubt and strains I feel s^...rethat it can face the future with confidence of our employees unless we can concurrently achievea real and sustainedsustained improvement in productivity DIAMONDS Diamond sales by the Central Selling Organisation in 1977 which was a record breaking year for De Beers all respects increased by 33 per cent compared with 1976. By end of the year in spite of two major price increases demand for all qualities of goods was at an unprecedented COAL Exports of South African coal through Richards Bay built up steadily in 1977 and by the last quarter the terminal was operating at its planned throughput of 12 million tons a year Export sales ^fin 1977 amounted to R248 million ' placing coal third behind gold and diamonds foreign - currency earnings This is a remarkable achievement reflecting great credit on the industry industry and the authorities and one that has contributed materiallyto the improve-  ment in the balance of payments Our own collieries produced some five million tons for export last year and this firm Highveld's vanadium slag has remained despite the generally weak vanadium market though the was an important factor in their progress Amcoal the Vantra division producing vanadium pentoxide operated Group's principal coal company achieved satisfactory only one of its eight roasting units during the year Scaw growth increasing turnover by 31 per cent to R259 million _ and earnings by 68 per cent to R47 million Construction at Amcoal's new Kleinkopje mine progressing well and production will start planned toward the end of this year to supply the local market and fulfil the Amcoal Metals achieved further growth in a difficult year increasing its equity earnings by 10,6 cent to R16 million in 1977. Little improvement can be expected in domestic demand for rolled steel this year though the outlook for fegndries and grinding media appears entitlement in Phase 2 of the export programme beginning in 1979. Notwithstanding some problems in the home and export markets am confident that the Group's coal interests with their wide spread of business and very large satisfactory International raised its after profits the carbide division tungsten excellent year by 6,7 In per cent to a new record of R17.5 million last recsion results in recession recesion in the coal reserves will continue to earn substantial are exceptionally well placed to participate in expansion of the trade profits the further base metal and construction industries Canada and Europe and extremely diamond well drilling division performed in Boart's earnings INDUSTRY F Although trading conditions in the home and overseas markets were even more difficult than in 1976 our Sigma Motor Corporation which had its first full year of operation in 1977 has made a promising start Though sales for the industry as a whole fell by more than 15 industrial interests generally made further progress during the year Highveld Steel and Vanadium Corporation substantially improved its equity carnings to R20,7 million in the year to June 30 1977 and was able maintain first earnings in the half of the new financial year The plate mill commissioned in August 1977 has madea substantial contribution theseresults enabling Highveld to enter a new sector of the local market increase its domestic sales and diminish the need to export steel semis Its subsidiary Transalloys brought a new silico- manganese smelter on stream in June 1977 and in January 1978 having converted an existing smelter started the production of silicon for Highveld Faced by pro- per cent compared with 1976 Sigma almost doubled its share of the passenger car market over year and significantly increased its share of the light commercial vehicle market Several new models were introduced and found a ready acceptance by the publicSince the company was formed in November 1976 the work force its Pretoria plant has increased by 77 cent to 2570. In July 1978 Sigma following its policy of rationalising the _ manufacture of highquality vehicles one South African company backed by the resources of our Corporation and the technology of international motor companies acquired the right to manufacture and distribute Peugeot and Leyland passenger vehicles in South Africa Further it ectionist measures against steel imports in some of its agreed to merge its heavy commercial vehicle and major markets Highveld has successfully diversified its overseas sales and with the improvement in world steel prices that those measures part have brought about has very creditably managed to maintain export earnings The steel industry's costs have been rising more rapidly than the administered prices of its products in the home market with the result that profit margins are being squeezed This is in contrast to the experience the three major industries coal electricity and the railways on which it largely depends where the controlled prices have been sufficient not only to working costs but contribute income for capital requirements Demand for specialised equipment interests with those of Leyland South Africa new company in which Signia would hold 51 per cent As a result the production of passenger cars will be concentrated in the Pretoria plant and of commercial vehicles at the Leyland facilities the Cape These moves Sigma the largest motor group in South Africa Our timber interests which are held mainly through S.A. Forest Investments have suffered from a falling volume of sales and prices Industry sales of sawn timber declined by over 23 per cent in 1977 continuing the adverse trend which startedin 1974 and price cutting has 5 resulted Every effort is being made to increase operating efficiency still further but this will not in itself restore identify new investments in the natural resource area and has recently taken two major initiatives to consolidate its profitability Mondi Paper Company and its subsidiary position in the North American base metals industry S.A. Board Mills did well to improve equity carnings by It has made jointly with Minerals and Resources 23 cent to R10,2 million in 1977 despite low prices for some products - particularly of newsprint in overseas markets - and the decling in newsprint consumption in South Africa To enable Mondi to manufacture a range of fi e papers presently imported at an annual cost to the e country some R14 million it is installing a second super- Corporation Minorco a tender offer 33 a share for all the shares in Inspiration Consolidated Copper not already owned by them Although Inspiration a loss of 11,1 million in mainly as a result of weak metal prices and a prolonged strike at the mine its substantial or^reserve and development potential leave it should calendar machine which the end the year be in production toward well placed to benefit from an upturn in copper prices and a revival ofinterest in the US base metals industry Hudson INTERNATIONAL OPERATIONS Base metals generally and copper nickel and zine in Bay has also tendered for the outstanding shares in formerly Whitehorse Copper Minesin which it per cent interest held 41,2 particular remained in supply during 1977. The resurgence in demand that had been hoped for failed to materialise as the recovery in the US economy faltered and fourd little response the other major developed Minorco by participating in the bid for full ownership ownership of Inspiration has made an important step towards the fuller realisation of its role as an international resources company addition to its interest in Inspiration economies Prices continued their downward drift accentuated by the increase in stocks and theaggressive competition for market share It is difficult be sanguine short about the prospects the term Although there are signs that the major producers for example copper are coming to accept the need fordiscipline in restricting production it must be remembered that their sensitivity to Minorco's major investments include a 29 per cent holding in Engelhard Minerals & Chemicals EMC EMC a successful year in 1977 its earnings 122,6 million being only marginally less than record profits of the previous year The Philipp Brothers division was again the foremost contributor although the Minerals and Chemicals and Engelhard Industries divisions both impaired market forces has been by the tendency for governments to become more involved in the control natural resources The dilemma of these governments ! achieved record profit levels The depressed state of the metals and commodities markets has inevitably strained the earnings capacity the Philipp Brothers division but todaiyn balancingthe conflicting requirements of price stability on the one hand and sufficient foreign exchang^ on the other cannot be resolved without substantial assistance from the developed countries and the various its resilience in diversifying successfully successfully into new trading areas encouraging for the futures Minorco's copper interests in Zambia which held indirectly through its 49 per cent holding in Zambia Copper Investments had a international agencies a Hudson Bay Mining & Smelting H^...dbayin which difficult year Both Nehanga Consolidated Copper Mines and Roan Consolidated Mines are incurring substantial Anglo American Corporation of Canada holds 38 per cent losses as result of low prices transport problems and the performed creditably in the difficult environment of 1977 Consolidated earnings before extraordinary items rose by 1,6 million to CS4,4 million the improved performance of the petroleum subsidiaries offsetting the rather disappointing results of the Canadian metals division and Terra Chemicals While the CS144 million that Hudbay i received from the sale of its potash mine to the constraints imposed on the efficient production . and distribution of copper by the critical shortage of foreign exchange The earnings before extraordinary items of our United Kingdom associate Charter Consolidated increased by 32 cent to million the year to March 1978 Significantly increased investment income and profits on Saskatchewan government has been eroded somewhat by realisations of investments more than offset the slight the need to finance ongoing capital expenditure and reduction in the contribution from the industrial sub- adverse cash flows the company is continuing its efforts to sidiaries Charter expanded its industrial activities during 6 the year by acquiring M.K. Refrigeration a manufacturing group that complenients Charter's existing interests in 49 per cent interest dividend payments have been re- is continuing continuing continuing if establish susmed umed Work establish to see if we can a continuing , catering and refrigeration and broadens its base f^rfuture viable gold mine on the Jacobina prospect in Bahia and investment in British industry Cape Industries manufac and contracting divisions performed successfully successfully in 1977 but their increased earnings were insufficient to ' offset the sharp decline in profits from number of other base metal projects are being actively fol- lowed up In this way and perhaps with acquisitions from * time to time we hope build up our position in Brazil Cleveland Potash made considerable progress the problems that have beset it nevertheless DIRECTORATE am pleased to record that on May 1977 Mr G WH 5 productioj remains disappointing and a sustained and Relly who has been chairman since its inception of the #concerted effort will be needed if the mine is to achieve operating Committee of the board was appointed join production targets In view of the continuing difficulties deputy chairman of the Corporation Mr G Langton while at Cleveland Potash and the escalation of development costs Charter wrote off 7,5 million againstis investment remaining on the board relinquished his appointment as technical director on January 1 1978 to assume the position in the company and in wrote off 7,7 million of managing director and chief executive in the gold and addition against investmentin Botswana in uranium division He was succeeded as technical director and Soci^'t^' Sy Mini^reTenke Fungurume by Mr JA Holmes Mr Holmes and Mr J N Clarke the Horizonteimproved In Brazil production has gold mines in Bello at the Morro Velho which our Group holds a director responsible for our finance office were appointed to the board's executive committee on January | 1978 Dg . : ' 44 Main Street Johannesburg July 26.1978 pot : Go : my 2 Chairman