Change of name and restructuring
The company changed its name from Vaal Reefs Exploration and Mining Company Limited to AngloGold Limited with effect from 30 March 1998 in preparation for being used as the vehicle for merging the gold interests of Anglo American Corporation of South Africa Limited (AAC) and companies associated with it into a single, independently managed, focused, global gold company.

On 4 June 1998, AngloGold shareholders in general meeting approved, inter alia, an arrangement whereby the company would acquire:

the entire issued share capitals of

? East Rand Gold and Uranium Company Limited,

? Eastvaal Gold Holdings Limited,

? Elandsrand Gold Mining Company Limited,

? Free State Consolidated Gold Mines Limited,

? H J Joel Gold Mining Company Limited,

? Southvaal Holdings Limited, and

? Western Deep Levels Limited

(the participating companies) in terms of Schemes of Arrangement
under Section 311 of the South African Companies Act to be concluded
between each of the participating companies and their respective members;

from AAC and certain of its subsidiaries and associates their gold mineral rights
and various share interests; and

cession of the service agreements held by AAC in respect of the participating
companies and other companies forming part of the merger transaction,

in return for the issue, credited as fully paid, of 78 204 908 ordinary shares of 50 cents each in the company:

? to the former members of the participating companies and cash
in respect of any fractional entitlements,

? to the vendors of the gold mineral rights and share interests, and

? to AAC in respect of the cession of service agreements.

Shareholders of the participating companies overwhelmingly approved the Schemes at subsequent meetings also held on 4 June 1998.

The Schemes in terms of which:

? existing shareholders of the participating companies were to
receive new shares in the company, in previously announced ratios, and

? the participating companies were to become wholly-owned subsidiaries
of the company,

were sanctioned by the High Court of South Africa (Witwatersrand Local Division) on 23 June 1998. All necessary documents, other than the documents relating to Eastvaal, were registered by the Registrar of Companies on 26 June 1998.

With all conditions precedent having been fulfilled, the Schemes, other than the Eastvaal Scheme, became operative on 29 June 1998. The listings of the participating companies, other than Eastvaal, on the Johannesburg Stock Exchange and, where applicable, the stock exchanges in London and Paris were terminated at the close of trading on 26 June 1998. The existing share certificates of those companies, other than Eastvaal, ceased to be of any value after 26 June 1998, other than for their entitlement upon their surrender to receive consideration in terms of the Schemes.

In the case of Eastvaal, the relevant documents were registered by the Registrar of Companies on 10 July 1998. Consequently, the Eastvaal Scheme became operative with effect from 13 July 1998. The listing of Eastvaal was terminated at the close of business on 10 July 1998 and the Eastvaal share certificates ceased to be of any value after that date, other than for the entitlement of Eastvaal members upon surrender to receive Eastvaal's consideration in terms of the Scheme.

AngloGold is a subsidiary of AAC, which holds a 50,95 per cent interest.

The method adopted for the combination of the participating companies on the formation of AngloGold is the uniting of interest method for accounting for mergers in terms of International Accounting Standard No. 22 ? Business Combinations. The 1997 comparative figures constitute the aggregation of the audited financial statements of the participating companies for the year ended 31 December 1997 as if the group had been in existence since 1 January 1997.

Events subsequent to the balance sheet

Acquisition
At a general meeting of the company held on 3 February 1999, shareholders approved the acquisition by the company of the gold interests of Minorco for a consideration of $550 million. The consideration will be funded by a three-year $350 million term loan facility, concluded with a syndication of banks on 12 February 1999, and cash from the company's own resources. All conditions precedent relating to the acquisition and funding arrangements are expected to be completed during the second half of March 1999, when the acquisition will become effective from 1 January 1999. Full details relating to the acquisition were contained in a circular to members dated 12 January 1999.

Driefontein Consolidated Limited
In an announcement dated 21 July 1998 it was disclosed that the company and Gold Fields Limited, as major shareholders of Driefontein Consolidated Limited, had concluded a joint venture agreement on the ownership and management of Driefontein. The terms of the agreement provided, inter alia, for an offer to be made to the minority shareholders of Driefontein which, if successful, would result in Driefontein being delisted and ownership shared 60:40 between Gold Fields and the company. However, subsequently, on 18 February 1999, it was announced, inter alia, that the company would dispose of its entire interest of 21,5 per cent, comprising 43 809 572 shares of 50 cents each, in Driefontein to Gold Fields for a consideration of R30 per share totalling R1 314 million. The purchase price is to be settled by way of R714 million in cash and a loan, on commercial terms, amounting to R600 million from the company, repayable in full within nine months from the date on which the transaction is approved by the shareholders of Gold Fields. In addition, as part of the arrangement, the company's holding company, AAC, will acquire Gold Fields' holding of 1 968 769 shares in the company, thereby increasing AAC's investment in AngloGold to 52,96 per cent.

Taxation
In his recent budget speech the Minister of Finance announced a reduction in the company tax rate from 35 per cent to 30 per cent. After taking into account Secondary Tax on Companies (STC) of 12,5 per cent, this reduces the total tax rate from 42 per cent to 38 per cent. The same reduction is reflected in the gold mining tax formula which changes from Y=51?255/x (where x is the profit to revenue ratio) to Y=46-230/x. The effect of this is that the tax payable would decrease by 9,8 per cent in the case of mining income and 9,5 per cent for non-mining income. With the marginal tax rate in respect of costs and capital expenditure dropping from 51 to 46 per cent, there will be a smaller tax benefit on initial capital expenditure on new projects, which is likely to result in the cash required for capital expenditure being 5 per cent higher.

Nature of business
AngloGold Limited is the world's largest gold producer with mining operations being conducted in three countries in Africa, as well as on the continents of North and South America, and gold exploration interests being pursued worldwide.

Fuller details regarding the company's activities during the year under review appear on pages 8 to 12.

Share capital

Authorised capital
In terms of a special resolution passed by shareholders at a general meeting held on 12 March 1998, and registered on 13 March 1998, the number of authorised ordinary shares was increased to 200 000 000 by the creation of 180 000 000 additional ordinary shares of 50 cents each.

There was no change in the authorised 2 000 000 A redeemable preference shares of 50 cents each and the 5 000 000 B redeemable preference shares of 1 cent each.