JOHANNESBURG, May 19 /CNW/ - Gold Fields Limited (NYSE & JSE: GFI) today
announced net earnings for the March 2011 quarter of R1,100 million
compared with a loss of R777 million in the December 2010 quarter and
earnings of R316 million in the March 2010 quarter. In US dollar terms
net earnings for the March 2011 quarter were US$158 million, compared
with a loss of US$106 million in the December 2010 quarter and earnings
of US$44 million in the March 2010 quarter.
March 2011 quarter salient features:
Group attributable gold production 830,000 ounces, 5 per cent higher
than corresponding quarter last year;
Total cash cost up 4 per cent to R168,455 per kilogram (US$751 per
ounce) in line with corresponding quarter last year;
Net operating costs reduced for the third successive quarter;
NCE margin up 1 percentage point to 21 per cent; and
Process of acquiring minorities in Peru completed and Ghana commenced.
Statement by Nick Holland, Chief Executive Officer of Gold Fields:
"Gold production of 830,000 ounces in the March 2011 quarter was 5 per
cent higher than the corresponding quarter a year ago (793,000 ounces).
The fall of 8 per cent from the previous quarter was due to the
traditional Christmas break in South Africa.
Sound cost control in all Regions has resulted in net operating costs
decreasing from R5,015 million (US$724 million) in the December quarter
to R4,878 million (US$699 million) in the March quarter as operations
continue to benefit from business process re-engineering (BPR).This is
the third quarter in a row that net operating costs have been reduced.
Despite the relatively high fixed cost nature of the business, total
cash cost increased quarter on quarter by only 4 per cent from R161,894
per kilogram (US$728 per ounce) to R168,455 per kilogram (US$751 per
ounce) despite lower production in the March quarter compared with the
December quarter. Cost containment allowed Gold Fields to increase its
NCE margin to 21 per cent. Our intention is to position the Group to
generate sustainable margins at a range of long-term gold prices.
Safety remains Gold Fields' single most important operational and
sustainability issue. This is embodied in our promise that "if we
cannot mine safely, we will not mine". To this end, we deeply regret
the five fatalities reported this quarter. Despite a significant
reduction in fatalities over the past three years, we have not shown an
improvement over the last three quarters. Subsequently we are applying
even greater rigour to our safety initiatives, centred mainly around
strategies to engineer out risks, increased focus on compliance to
standards and behavioural change.
Our growth strategy continues apace. Resource definition drilling
continues at the Chucapaca project in Peru, with twelve drills
currently on site. Drilling results demonstrate strong grade and
structural continuity within the current resource model, and suggest
that mineralisation is still open to the west. In parallel, work is
ongoing on collecting data for the feasibility study, including
metallurgical test work and the environmental impact assessment (EIA).
A substantial community engagement and socio-economic programme is
underway in the Chucapaca project area.
In the Philippines, exploration at the Far South East project is ramping
up with five underground diamond drill rigs operating. Three more rigs
are expected to be commissioned during the June 2011 quarter.
The metallurgical drilling programme at the Arctic Platinum project in
Finland was completed. Two 50 tonne ore samples are now available for
pilot plant flotation, which is scheduled to start in the June 2011
quarter and completed in the September 2011 quarter.
At the Yanfolila project in southern Mali, an inferred Mineral Resource
of 740,000 gold equivalent ounces was declared as at December 2010. The
resource delineation drilling programme is continuing and we expect
further meaningful increases in our resource position during 2011. In
addition, a scoping study is planned for later in the year.
Due to the progress we have made on these projects we are well
positioned to achieve our goal of the Group having a profile of 5
million ounces per annum either in production or in development by
At the end of the March quarter, Gold Fields Corona (BVI) Limited, a
wholly owned subsidiary of Gold Fields Limited made a voluntary
purchase offer to acquire the outstanding common voting shares and
investment shares of Gold Fields La Cima that were not already owned.
The offer closed on 15 April 2011 with a high percentage take-up
bringing our effective economic shareholding in La Cima (Cerro Corona)
to 98.5 per cent from 80.7 per cent. This transaction was partially
financed by a draw-down of existing debt facilities.
We have also entered into a binding agreement with IAMGOLD Corporation
to acquire its 18.9 per cent minority stake in our Tarkwa and Damang
mines in Ghana, for a cash consideration of US$667 million. The
completion of the proposed acquisition, which is subject to certain
conditions precedent being met, including Gold Fields shareholders
approval, is expected by 31 July 2011.
These transactions are low risk acquisitions in line with our strategy
of increasing our offshore exposure and acquiring 100 per cent of our
operating assets where possible.
We have published our Integrated Annual Report for the six months to 31
December 2010. This marks an important change for Gold Fields, as it
represents our first attempt at 'integrated' reporting, blending our
operational, sustainability and financial performance. The integrated
report provides a holistic understanding of Gold Fields performance,
risks and opportunities and exciting long-term prospects. I encourage
you to read the report."
The full results are available on the Gold Fields website: http://www.goldfields.co.za
Notes to editors
About Gold Fields
Gold Fields is one of the world's largest unhedged producers of gold
with attributable annualised production of 3.6 million gold equivalent
ounces from eight operating mines in Australia, Ghana, Peru and South
Africa. Gold Fields also has an extensive and diverse global growth
pipeline with four major projects in resource development and
feasibility, with construction decisions expected in the next 18 to 24
months. Gold Fields has total attributable gold equivalent Mineral
Reserves of 76.7 million ounces and Mineral Resources of 225.4 million
ounces. Gold Fields is listed on the JSE Limited (primary listing), the
New York Stock Exchange (NYSE), NASDAQ Dubai Limited, Euronext in
Brussels (NYX) and the Swiss Exchange (SWX).
SOURCE Gold Fields Limited
For further information:
Enquiries: Investor Enquiries: Zakira Amra, Tel +27-11-562-9775, Mobile +27(0)79-694-0267, email Zakira.Amra@goldfields.co.za ; Nikki Catrakilis-Wagner, Tel +27-11-562-9706, Mobile +27(0)83-309-6720, email Nikki.Catrakilis-Wagner@goldfields.co.za ; Willie Jacobsz, Tel +508-839-1188, Mobile +857-241-7127, email Willie.Jacobsz@gfexpl.com ; Media Enquiries: Sven Lunsche, Tel +27-11-562-9763, Mobile +27(0)83-260-9279, email Sven.Lunsche@goldfields.co.za