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Can AngloGold Ashanti Maintain Its Strong Free Cash Flow Growth?
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Key Takeaways
AU's Q1 free cash flow soared 7x to $407M, fueled by higher gold prices and stronger sales volumes.
Gold output rose with the Sukari Mine acquisition and improved performance at Siguiri and Tropicana.
AU's adjusted net debt dropped 60% YoY, and 2025 EPS is projected to grow 125.8% to $4.99.
AngloGold Ashanti plc (AU - Free Report) delivered an impressive seven-fold increase in free cash flow to $407 million in the first quarter of 2025. The jump in free cash flow was primarily attributed to higher gold prices, which added $544 million, while increased volumes accounted for a further $246 million.
Gold production and sales from managed operations were bolstered by the first-time contribution from the recently acquired Sukari Gold Mine in Egypt and solid output improvements at both Siguiri and Tropicana.
Net cash inflow from operating activities was $725 million in the quarter, marking a 188% increase year over year from $252 million. This strong performance was primarily driven by a on higher prices and sales volumes. However, some of these gains were offset by higher volume-related operating costs, reduced dividends from joint ventures and increased tax payments.
After accounting for capital expenditure, loan repayments from Kibali and dividends paid to non-controlling shareholders, AngloGold Ashanti generated a free cash inflow of $403 million. The company closed the quarter with approximately $3.0 billion in liquidity, including $1.5 billion in cash and cash equivalents. Adjusted net debt fell 60% year over year to $525 million, with the adjusted net debt-to-EBITDA ratio improving to 0.15x from 0.86x. AngloGold Ashanti remains focused on maintaining a strong and flexible balance sheet.
In 2024, the company had also demonstrated strong performance with free cash flow reaching $942 million, up 764% from 2023, primarily due to favorable gold pricing. For 2025, AngloGold Ashanti projects gold production of 2.9-3.225 million ounces, indicating 9–21% growth over the prior year. Higher production, combined with the rally in gold prices this year as well as the company’s efforts to lower costs, is expected to drive further gains in cash flow this year.
Newmont Corporation (NEM - Free Report) achieved a record first-quarter free cash flow of $1.2 billion, marking a significant turnaround from a negative $74 million in the same period a year ago. This substantial improvement came on the back of Newmont's enhanced operational efficiency and the strength of its Tier 1 portfolio. Strong free cash flow positions Newmont to strengthen its balance sheet and pursue strategic growth investments.
Barrick Mining Corporation (B - Free Report) reported a free cash flow of $375 million for the first quarter, a nearly 12-fold year-over-year rise. The surge reflects Barrick’s higher operating cash flows driven by an uptick in realized gold and copper prices. Barrick reduced net debt by 5% during the quarter, leveraging healthy free cash flow generation.
AU’s Price Performance, Valuations & Estimates
AngloGold Ashanti’s stock has skyrocketed 125% year to date, outperforming the Zacks Mining – Gold industry’s 54.2% growth. During this time, the Basic Materials sector has risen 13.6% and the S&P 500 has rallied 6.8%.
AU is currently trading at a forward 12-month earnings multiple of 10.49X, a discount to the industry average of 12.46X. The stock has a Value Score of B.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for AngloGold Ashanti’s 2025 sales is $8.85 billion, indicating 52.8% year-over-year growth. The consensus mark for the year’s earnings is $4.99 per share, indicating year-over-year growth of 125.8%.
The Zacks Consensus Estimate for 2026 sales implies 2.3% year-over-year growth. The same for earnings indicates a decline of 1.3%.
EPS estimates for 2025 and 2026 have been trending north over the past 60 days, as seen in the chart below.
Image: Bigstock
Can AngloGold Ashanti Maintain Its Strong Free Cash Flow Growth?
Key Takeaways
AngloGold Ashanti plc (AU - Free Report) delivered an impressive seven-fold increase in free cash flow to $407 million in the first quarter of 2025. The jump in free cash flow was primarily attributed to higher gold prices, which added $544 million, while increased volumes accounted for a further $246 million.
Gold production and sales from managed operations were bolstered by the first-time contribution from the recently acquired Sukari Gold Mine in Egypt and solid output improvements at both Siguiri and Tropicana.
Net cash inflow from operating activities was $725 million in the quarter, marking a 188% increase year over year from $252 million. This strong performance was primarily driven by a on higher prices and sales volumes. However, some of these gains were offset by higher volume-related operating costs, reduced dividends from joint ventures and increased tax payments.
After accounting for capital expenditure, loan repayments from Kibali and dividends paid to non-controlling shareholders, AngloGold Ashanti generated a free cash inflow of $403 million. The company closed the quarter with approximately $3.0 billion in liquidity, including $1.5 billion in cash and cash equivalents. Adjusted net debt fell 60% year over year to $525 million, with the adjusted net debt-to-EBITDA ratio improving to 0.15x from 0.86x. AngloGold Ashanti remains focused on maintaining a strong and flexible balance sheet.
In 2024, the company had also demonstrated strong performance with free cash flow reaching $942 million, up 764% from 2023, primarily due to favorable gold pricing. For 2025, AngloGold Ashanti projects gold production of 2.9-3.225 million ounces, indicating 9–21% growth over the prior year. Higher production, combined with the rally in gold prices this year as well as the company’s efforts to lower costs, is expected to drive further gains in cash flow this year.
Newmont Corporation (NEM - Free Report) achieved a record first-quarter free cash flow of $1.2 billion, marking a significant turnaround from a negative $74 million in the same period a year ago. This substantial improvement came on the back of Newmont's enhanced operational efficiency and the strength of its Tier 1 portfolio. Strong free cash flow positions Newmont to strengthen its balance sheet and pursue strategic growth investments.
Barrick Mining Corporation (B - Free Report) reported a free cash flow of $375 million for the first quarter, a nearly 12-fold year-over-year rise. The surge reflects Barrick’s higher operating cash flows driven by an uptick in realized gold and copper prices. Barrick reduced net debt by 5% during the quarter, leveraging healthy free cash flow generation.
AU’s Price Performance, Valuations & Estimates
AngloGold Ashanti’s stock has skyrocketed 125% year to date, outperforming the Zacks Mining – Gold industry’s 54.2% growth. During this time, the Basic Materials sector has risen 13.6% and the S&P 500 has rallied 6.8%.
AU is currently trading at a forward 12-month earnings multiple of 10.49X, a discount to the industry average of 12.46X. The stock has a Value Score of B.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for AngloGold Ashanti’s 2025 sales is $8.85 billion, indicating 52.8% year-over-year growth. The consensus mark for the year’s earnings is $4.99 per share, indicating year-over-year growth of 125.8%.
The Zacks Consensus Estimate for 2026 sales implies 2.3% year-over-year growth. The same for earnings indicates a decline of 1.3%.
EPS estimates for 2025 and 2026 have been trending north over the past 60 days, as seen in the chart below.
Image Source: Zacks Investment Research
AU currently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.