6-K 1 gld.htm
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
Report of Foreign Private Issuer
Pursuant to Rules 13a-16 or 15d-16 under
the Securities Exchange Act of 1934
Dated 15 February 2019
Commission File Number: 001-31318
GOLD FIELDS LIMITED
(Translation of registrant’s name into English)
150 Helen Rd.
Sandown, Sandton 2196
South Africa
(Address of principal executive offices)
Indicate by check mark whether the registrant files or will file annual reports under cover
Form 20-F or Form 40-F.
Form 20-F
Form 40-F
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by
Regulation S-T Rule 101(b)(1): _____
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by
Regulation S-T Rule 101(b)(7): _____
Salient features
2.036
million ounces of
Attributable gold production
Gruyere 89% complete. First
ore through the crusher in
Q1 2019
AISC and AIC below original
guidance
US$981
per ounce
All-in sustaining costs
Restructuring of South Deep
complete
Damang life extension project
ahead of plan
US$1,173
per ounce
All-in costs
Production ahead of revised
guidance (9 November 2018)
and within 4% of original
guidance (excluding Asanko)
Positive Salares Norte feasibility
completed
JOHANNESBURG. 15 February 2019:
Gold Fields Limited (NYSE & JSE: GFI) announced normalised profit
from continuing operations of US$27 million for the year ended December 2018 compared with normalised
profit of US$154 million for the year ended December 2017.
A final dividend number 89 of 20 SA cents per share (gross) is payable on 18 March 2019, giving a total
dividend for the year ended December 2018 of 40 SA cents per share (gross).
Statement by Nick Holland,
Chief Executive Officer
of Gold Fields
2018 in review
2018 marked the second year of the
reinvestment programme embarked on by
Gold Fields at the end of 2016. The key
driver of the reinvestment plan was to
ensure that our portfolio of mines continues
to generate cash sustainably into the
foreseeable future, by lowering group all-in
costs and extending the average mine life.
Having spent total project capital of
US$502m over the past two years, primarily
on Damang and Gruyere, Gold Fields is now
on track to ensure that our international
operations will be producing over 2Moz a
year for the next decade. This milestone is
expected to be reached for the first time in
2019 as Damang grows production;
Gruyere commences production and our
Asanko JV contributes for the full year.
Gold Fields is expected to increase
production by 4% to 7% in 2019.
The longer-term future of the Group also
looks positive as we continue to invest in
near-mine exploration at our Australian
mines, which yet again enabled us to put
back into reserves what was depleted last
year and add beyond that. A positive
feasibility study for the Salares Norte
project has been completed and a maiden
reserve of 3.5Moz has been declared.
While South Deep had a difficult year, the
large scale restructuring completed at the
end of 2018, places the mine on an
improved footing from which to gradually
build-up production, having removed over
R800m out of our cost base and R400m of
capital expenditure with a significantly
reduced footprint.
During 2018, we have seen a continued
improvement in our health and safety
performance as stringent safety culture and
standards become entrenched at our
operations and projects. Gold Fields’ Total
Recordable Injury Frequency Rate (TRIFR)
fell below two recordable injuries per million
hours worked for the first time in 2018, a
24% YoY improvement and the lowest level
ever recorded for the Group. However, we
still recorded one fatality last year (three in
2017), which served as a tragic reminder
that we have lots more work to do to
eliminate all fatalities and further reduce
injuries.
Attributable gold equivalent production for
2018 was 2.04Moz (FY17: 2.16Moz),
exceeding revised guidance of 2.00Moz.
2018
MEDIA
RELEASE
REVIEWED RESULTS
Year ended 31 December 2018
Gold Fields 2018 RESULTS
2
All-in sustaining costs (AISC) and all-in costs (AIC) were US$981/oz
(FY17: US$955/oz) and US$1,173/oz (FY17: US$1,088/oz),
respectively, both below the lower end of the guidance range
provided in February 2018 – AISC: US$990-1,010/oz and AIC:
US$1,190-1,210/oz. All operations, apart from South Deep,
exceeded guidance for the year, once again highlighting the quality
of the portfolio, with these operations being higher on production
and lower on costs.
Headline earnings for 2018 were US$61m or US$0.07 per share
(2017: US$210m or US$0.26 per share). Net loss for the year was
US$348m or US$0.42 per share (2017: US$19m or US$0.02 per
share). Normalised profit for the year was US$27m or US$0.03 per
share (2017: US$154m or US$0.19 per share).
In line with our dividend policy of paying out 25% to 35% of net
earnings as dividends, we declared a final dividend of 20 SA cents
per share. This takes the total dividend for the year to 40 SA cents
per share (FY 2017: 90 SA cents per share).
As expected, 2018 was another higher capital expenditure year, with
a total of US$814m spent in the year given that 2018 was the peak
year of capital spend on new projects. As a result, the net cash
outflow for the year was US$132m, compared to US$2m in 2017.
Mine cash flow for the year, which excludes project capital, was
US$334m, compared to US$441m in 2017.
Largely on the back of the net cash outflow for the year and the
US$165m payment for the acquisition of the 45% in Asanko Gold
Mine, the net debt at 31 December 2018 increased to US$1,612m,
compared to US$1,303m at the end of FY 2017. This implies a net
debt to adjusted EBITDA of 1.45x, compared to 1.03x at the end of
December 2017 and well within our covenant of 2.5x. This increase
was anticipated, given the significant spend on projects in 2018,
however, we expect the net debt to adjusted EBITDA ratio to reduce
in 2019.
Despite the heavy capital expenditure over the past two years, Gold
Fields balance sheet remains in a comfortable position. As the group
continuously reviews its funding and maturity profile, it is considering
opportunities to access the US$ international bond markets primarily
to refinance its debt facilities – including potentially the US$1bn
4.875% 144A/RegS bond maturing in October 2020.
Update on the projects
Damang Reinvestment project
The reinvestment project, which commenced on 23 December 2016,
continued to track well against plan during 2018. Total tonnes mined
were 45.9Mt (2017: 39.7Mt) in 2018 vs. the project schedule of
41.5Mt, driven by a good performance by both of the contractors
(BCM and E&P). Gold produced of 180.8koz (2017: 143.6koz) was
13% higher than guidance of 160.0koz, underpinned by high-grade
material from the Amoanda pit, while AIC of US$1,506/oz (2017:
US$1,827/oz) was below guidance of US$1,520/oz. Project capital
of US$125m was spent during 2018, on top of the US$115m spent
during 2017.
The project is on track to begin sourcing higher-grade ore from the
Saddle area of the DPCB early in 2019 and then reach the reef
horizon of the main pit in early 2020. The Amoanda pit has been the
main ore source during the cutback of the main Damang pit, with
positive grade reconciliation from Amoanda being a key driver to the
outperformance of the project over the past 24 months.
The Far East Tailings Storage Facility (FETSF), which will provide
cost effective life of mine tailings capacity of 44Mt, was
commissioned during Q4 2017, on time and within budget.
Decommissioning of the East Tailings Storage Facility (ETSF)
commenced during Q1 2018, and was completed during 2018, with
all tailings now being deposited on the FETSF.
Gruyere
During 2018, the JV partners announced a slight delay to project
completion and an increase in the final forecast capital (FFC) cost
estimate. First gold is now expected to be poured during the June
2019 quarter (previously the March 2019 quarter) whilst the FCC
estimate is A$621m, a 17% increase from the previous FCC estimate
of A$532m.
As at end-December 2018, engineering was largely complete, whilst
construction progress was 86.7% vs. budget of 86.4%, with all major
equipment and materials for effective construction already delivered
to site. During 2018, civil works on the tailings storage facility and
installation of the tailings decant recovery pipelines were completed
and the power station was fully commissioned. All civil and concrete
works for the process plant were completed by year-end, with
structural steel, plate steel and tankage nearing completion. Post
year-end, the remaining work focused on piping, electrical and
instrumentation and delivery of plant systems for commissioning of
the plant which is expected during Q2 2019.
Mining contractor, Downer EDI, began mobilising their workforce
during Q1 2018 to begin construction of the mining infrastructure.
Mining activities commenced in November 2018, focusing on
completing the pre-strip and second stage ROM pad development.
First ore was mined and crushed post year-end.
During 2018, A$306m (US$230m) (100% basis) was spent on the
project, bringing the cumulative costs incurred as at end-December
2018 to A$492m (US$374m). The remaining project capital of
A$129m (US$97m) (100% basis) has been budgeted for 2019, the
majority of which will be spent during the first half of the year.
First gold is forecast for Q2 2019 with production of 59koz (Gold
Fields 50% share) forecast for the year. A relatively quick ramp up
is anticipated, with steady state run rate expected by year-end.
Salares Norte
The feasibility study for the project was completed and peer
reviewed during 2018. The key elements of the feasibility study
include:
· Initial 11.5-year life of mine
· Annual throughput of 2mt
· Life of mine production of 4.0Moz gold equivalent which will be
front-end loaded
· Annual production of 355koz gold equivalent over life of mine
(annual production of 450koz for first 7 years)
· AISC of US$545 per gold equivalent ounce (AISC of US$465/oz
for first 7 years)
· Project capital of US$850m (+/-5%)
· IRR of 25% at US$1,300/oz gold price with a 2.2 year payback
period, from commencement of first production
· NPV is US$654m (discount rate 7.5%) from full notice to proceed
· Strip ratio 13.9 (including pre-strip) and 11.7 (excluding pre-strip)
In December 2018, Gold Fields updated the project's Mineral
Resources and Reserves, reporting a total Mineral Resource of
25.6Mt of gold at a grade of 4.76g/t to give 3.9Moz, and 43.7Moz of
silver at an average grade of 53.1g/t. More pertinently, a maiden
Reserve has been declared with 3.5Moz of gold (21.1Mt at 5.1g/t)
and 39.3Moz of silver at 57.9g/t.
The project envisages open pit operations with a processing plant
that includes both CIP and Merrill Crowe processes, due to the high
silver content. In addition, given the scarcity of water in the area, dry
stack tailings are expected to be used.
3
Gold Fields 2018 RESULTS
The Environmental Impact Assessment (EIA) was accepted for
review on 11 July 2018. Gold Fields anticipates the EIA review to take
18 – 24 months to complete. Given the declaration of the maiden
reserve together with the positive results of the feasibility study,
management is confident that the project will be developed.
However there is sufficient time to consider funding options and
whether or not to bring in a partner to develop the asset.
Regional performance in FY 2018
Australia
Gold Fields’ Australian operations delivered another strong
operational performance in 2018. Gold production at 886koz was
better than full year guidance of 865koz, with Granny Smith, St Ives
and Agnew all outperforming both production and cost guidance.
Production was 5% lower than in 2017 (935koz), which included
three quarters of production from Darlot. AIC for the region was 4%
higher YoY at A$1,262/oz (FY17: A$1,210/oz) but marginally higher
in US$ terms at US$926/oz (FY17: US$948/oz). The region had
another strong year of cash generation, with net cash inflow of
US$194m (FY17: US$189m), excluding Gruyere capital.
In an important development for Agnew, Gold Fields made the
decision to invest in a new camp (we previously rented rooms from
BHP Billiton in Leinster 26 km away from site) and hybrid power
station on site. The first buildings for the camp arrived on 15
December 2018 and construction commenced in January 2019.
Commissioning of 450 rooms and the central facilities is targeted for
May 2019. The new power station will entail a combination of gas,
solar and wind power generation. Commissioning of the gas and
solar components is scheduled for June 2019, with wind generation
to follow in Q1 2020.
West Africa
Attributable gold production from the West Africa region, which
includes Asanko Gold Mine’s (AGM) contribution from 1 August
2018, increased 6% to 680koz (FY17: 639koz). Excluding the AGM
contribution, attributable production would have decreased by 1%
to 635koz, however this was 4% ahead of guidance for the year.
Damang materially outperformed guidance of 160koz, producing
181koz due to continued outperformance from the Amoanda pit. AIC
for the region decreased by 2% to US$1,098/oz (FY17:
US$1,119/oz), and beat guidance of US$1,100/oz. The good cost
performance was mainly due to lower net operating costs and lower
sustaining capital expenditure, partially offset by lower gold sold and
higher project capital at Damang. Despite the increase in project
capital at Damang (US$125m in FY18 vs. US$115m in FY17), the
region generated net cash flow of US$24m (FY17: US$64m).
During the year, Tarkwa transitioned from owner mining to contractor
mining in an attempt to address cost inflation in the region. The
mining contract was demarcated into two zones and awarded to two
local contractors: BCM for Zone 1 (Pepe, Mantraim, Atuabo and
Teberebe Pits) and E&P for Zone 2 (Akontansi and Kottraverchy Pits).
BCM mobilised and started operations in Zone 1 on 24 March 2018,
with E&P following in the Zone 2 area on 7 April 2018. As part of the
tender process, the contractors undertook to purchase all fleet from
Gold Fields, which largely covered the retrenchment costs incurred
through the process.
South America
Cerro Corona in Peru had another solid year in 2018, with attributable
gold-equivalent production of 313koz (2017: 305koz). This was 12%
higher than the gold-equivalent production guidance for the year of
280koz, underpinned by the higher copper price ratio and higher
copper production due to a higher copper head grade as a result of
higher grade areas mined. AISC and AIC were US$282/oz in 2018
compared to US$203/oz in 2017 and, on a gold equivalent basis,
US$699/oz in 2018 (2017: US$673/oz). The increase in AISC and
AIC was primarily due to lower by-product credits, lower gold sold
and higher cost of sales before amortisation and depreciation. Both
AISC and AIC comfortably beat guidance for the year of US$585/oz
and, on a gold equivalent basis US$810/oz. On the back of the
strong operating performance, Cerro Corona generated net cash
flow of US$114m (FY17: US$117m).
South Africa
South Deep got off to a tough start in 2018, with production in Q1
2018 impacted by a slow build up after the seasonal holidays, two
labour restructuring processes that took place at the end of 2017
and during Q1 2018, and a change in the underground working shift
arrangements implemented in an attempt to increase productivity. In
addition, low mobile equipment reliability, the intersection of active
geological features (faults and dykes) in the high-grade corridor 3
and poor ground conditions in the even higher grade composites (far
western part of the orebody) slowed production rates. Production
was further impacted by a 22-day DMR related safety stoppage
during April 2018. As a result of these factors, guidance for the mine
was downgraded to 7,600kg (244koz) with the release of our Q1
2018 production update on 25 April 2018, from the original guidance
of 10,000kg (321koz).
Despite the two restructuring processes, South Deep continued to
face a number of organisational and structural challenges that
directly affected performance during Q2 2018, with production
during the quarter only marginally higher than Q1 2018 at 1,518kg
(49koz). As a result, on 14 August 2018, Gold Fields announced a
material restructuring of the mine, to right-size the cost base to
match existing levels of output.
As part of the restructuring, Gold Fields served a Section 189 notice
to its trade unions (the NUM and UASA) on 14 August 2018. The
consultation period ended on 31 October 2018 and Gold Fields
formally served the NUM and UASA with a list of employees that
were to be given notice of termination as per the Section 189
process. The majority union (NUM) embarked on a strike on 2
November 2018 which lasted six weeks. The NUM eventually
suspended the strike on 18 December 2018 and signed a settlement
agreement. Through the restructuring, a total of 1,092 permanent
employees exited the business, of which 904 were retrenched, 183
opted for voluntary separation packages and five resigned. Gold
Fields also reduced its underground fleet through the restructuring,
with the aim of decongesting the working areas. In this regard, the
number of Cat 1 machines was reduced by 33% from 98 to 66 (drill
rigs, loaders and trucks).
Given the slow start to the year together with the impacts of the strike
with very little production in Q4 2018, South Deep’s production
decreased 44% YoY to 4,885kg (157koz) and was 36% below
revised guidance of 7,600kg (244koz). AIC of R854,049/kg were also
significantly higher than expected (guidance: R540,000/kg)
underpinned by the significantly lower amount of gold sold during
the year. The mine recorded a net cash outflow of R1,891m
(US$141m) which includes R148m in retrenchment payments.
In the wake of the restructuring, which has seen our employee
workforce fall by 38% from 3,983 to 2,460 and the number of
contractors from 2,294 to 1,725, we are in a position to significantly
reduce South Deep’s pre-restructuring cash-burn during 2019. We
expect to build-up gradually to a sustainable production profile from
this restructured position. The key enablers for sustainable
improvements at South Deep are:
· Accelerate backfill placement
· More robust and timely ground support
· Improved drill and blast to improve stope design and reduce
· underbreak and overbreak
· Improved fleet availability and utilisation
· Flatter organisational structure
Gold Fields 2018 RESULTS
4
· Rigorous performance management linked to line of sight
performance
· Improved stakeholder management, including government,
unions and surrounding communities.
Asanko JV
In March 2018, Gold Fields entered into an agreement to form a
50:50 incorporated joint venture (JV) with Asanko Gold. In the deal
which went unconditional on 31 July 2018, Gold Fields acquired a
50% stake in Asanko Gold Ghana’s 90% interest in the Asanko Gold
Mine (AGM), associated properties and exploration rights in Ghana.
While Asanko remains operators of the asset, a JV committee has
been established in which Gold Fields actively contributes from a
geotechnical, modelling and planning perspective.
The purchase consideration included an upfront payment of
US$165m and a deferred payment of US$20m payable on the earlier
of an agreed Esaase development milestone or 31 December 2019.
In addition, Gold Fields purchased 9.9% of Asanko Gold’s issued
equity through a private placement for a total consideration on
US$17.6m.
During 2018, AGM produced 223koz (100% basis) at an AISC of
US$1,069/oz and AIC of US$1,175/oz. Guidance for 2019 is
225,000oz to 245,000oz (100% basis) at AISC of US$1,040/oz to
US$1,060/oz and AIC of US$1,090/oz to US$1,110/oz. Included in
the guidance is first production from oxide material from the Esaase
deposit which will be trucked to the processing plant.
Mineral Reserves
Gold Fields has increased its focus on growing its Reserve base
outside of South Africa. During 2018, there were some significant
developments in this regard, including:
· A maiden gold equivalent reserve of 4.0Moz was declared at
Salares Norte in Chile
· There was a 0.3Moz (4% YoY) increase in the Australian region’s
reserves, net of depletion. Notably, this includes an 11% YoY
increase in St Ives’ reserves net of depletion
· There was a net decrease of 4.6Moz at South Deep due to
geotechnical re-design, adjusted loss factors and an increased
cut-off grade
As at end-2018, 20.5Moz of Gold Fields’ Reserves (excluding Gold
Fields’ 45% interest in the Asanko Gold Mine) were outside South
Africa, representing 41% of the Group’s Reserve base.
Managed
Attributable
December 2018
Gold equivalent resources
Moz
140.5
108.2
Gold equivalent reserves
Moz
54.0
50.3
December 2017
Gold equivalent resources
Moz
148.6
115.6
Gold equivalent reserves
Moz
54.9
50.8
Metal prices used for equivalent ounces:
Gold US$1,200/oz
Copper US$2.8/lb
Silver US$17.50/oz
The metallurgical recovery rate has not been applied to the conversion
Eskom power crisis
We note that Eskom is in a crisis, placing the whole country at risk.
While there is no silver bullet, we want security of supply restored,
especially for the mining industry. South Deep is currently operating
below capacity, which does provide the mine with some flexibility on
power usage. We have short, medium and long-term strategies in
place to mitigate the risk, including, scheduling of activities,
additional off-grid power and longer term renewables. We continue
to engage through industrial associations to provide assistance
where possible.
2019 outlook and guidance
2019 is set to be an important year for Gold Fields, with the Damang
project approaching completion and Gruyere commencing
production. In addition, Asanko will contribute for a full year for the
first time since acquisition. This will allow the Group to increase
production by 4 – 7% in 2019. This also means that our capital
expenditure will fall quite aggressively through 2019 and the amount
of project capex reduces. The year will however, be one of two
halves, with both production and cash flow being weighted to 2H
2019.
For 2019, Gold Fields has undertaken certain gold price hedging, in
order to secure short-term cash flow and protect the balance sheet
from the volatility of the gold price as we complete our investment
phase and ramp up the projects.
Attributable equivalent gold production for the Group for 2019 is
expected to be between 2.13Moz and 2.18Moz. AISC is expected
to be between US$980/oz and US$995/oz. AIC is planned to be
between US$1,075/oz and US$1,095/oz. These expectations
assume exchange rates of R/US$:13.80 and A$/US$:0.75.
Production for South Deep is expected to be 6,000kg (193koz), with
AIC of R610,000/kg (US$1,372/oz).
Capital expenditure for the Group is planned at US$633m.
Sustaining capital expenditure for the Group is planned at US$490m
and growth capital expenditure is planned at US$143m. The
US$143m growth capital expenditure comprises US$69m for
Damang and A$99m (US$74m) for Gruyere. Expenditure on Salares
Norte is expected to be US$57m in 2019. The capital expenditure
above excludes the Group’s share of Asanko’s total capital
expenditure of US$25m for 2019.
N.J. Holland
Chief Executive Officer
15 February 2019
STOCK DATA FOR THE YEAR ENDED 31 DECEMBER 2018
Number of shares in issue
NYSE – (GFI)
– at 31 December 2018
821,532,707
Range – Year
US$2.43 – US$3.56
– average for the year
821,532,707
Average Volume – year
4,519,927 shares/day
Free Float
100 per cent
JSE LIMITED – (GFI)
ADR Ratio
1:1
Range – Year
ZAR32.90 – ZAR56.49
Bloomberg/Reuters
GFISJ/GFLJ.J
Average Volume – year
2,263,467 shares/day
Gold Fields 2018 RESULTS
5
Key Statistics
United States Dollars
Quarter
Year ended
Figures are in millions unless otherwise stated
December
2018
September
2018
December
2017
2018
2017
Gold produced attributable* oz
(000)
509
533
546
2,036
2,160
Continuing operations
509
533
546
2,036
2,121
Discontinued operations
−
−
−
−
39
Tonnes milled/treated
000
8,571
8,878
8,450
34,110
34,492
Continuing operations
8,571
8,878
8,450
34,110
34,154
Discontinued operations
−
−
−
−
338
Revenue US$/oz
1,212
1,184
1,275
1,251
1,255
Continuing operations
1,212
1,184
1,275
1,251
1,255
Discontinued operations
−
−
−
−
1,252
Cost of sales before gold inventory
change and amortisation and
depreciation
US$/tonne
43
41
43
42
43
Continuing operations
43
41
43
42
42
Discontinued operations
−
−
−
−
137
All-in sustaining costs
#
US$/oz
1,016
977
959
981
955
Continuing operations
1,016
977
959
981
945
Discontinued operations
−
−
−
−
1,432
Total all-in cost
#
US$/oz
1,213
1,140
1,115
1,173
1,088
Continuing operations
1,213
1,140
1,115
1,173
1,081
Discontinued operations
−
−
−
−
1,432
Net debt
US$m
1,612
1,564
1,303
1,612
1,303
Net debt to EBITDA ratio
1.45
1.03
Cash flow from operating activities**
US$
(132)
(2)
Continuing operations
(132)
(2)
Discontinued operations
−
−
(Loss)/profit
US$m
(348.2)
(18.7)
Continuing operations
(348.2)
(31.8)
Discontinued operations
−
13.1
(Loss)/profit
US c.p.s.
(42)
(2)
Continuing operations
(42)
(4)
Discontinued operations
−
2
Headline earnings/(loss)
US$m
60.6
209.9
Continuing operations
60.6
212.3
Discontinued operations
−
(2.4)
Headline earnings
US c.p.s.
7
26
Continuing operations
7
26
Discontinued operations
−
−
Normalised profit/(loss)
US$m
26.9
153.8
Continuing operations
26.9
157.3
Discontinued operations
−
(3.5)
Normalised profit
US c.p.s.
3
19
Continuing operations
3
19
Discontinued operations
−
−
* Gold produced in this table is attributable and includes Gold Fields share of 45 per cent in Asanko.
** Cash flow from operating activities (net of tax) less net capital expenditure, environmental payments and finance lease payments.
#
Refer to page 30 and 31.
All operations are wholly owned except for Tarkwa and Damang in Ghana (90.0 per cent), Cerro Corona in Peru (99.5 per cent) and Asanko JV (45 per cent equity share).
Gold produced (and sold) throughout this report includes copper gold equivalents of approximately 7 per cent of Group production.
Figures may not add as they are rounded independently.
Gold Fields 2018 RESULTS
6
Certain forward looking statements
This report contains forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, or the
Securities Act, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended, or the Exchange Act, with respect to Gold Fields’
financial condition, results of operations, business strategies, operating efficiencies, competitive position, growth opportunities for existing
services, plans and objectives of management, markets for stock and other matters. Such forward-looking statements can be identified by
the use of forward-looking terminology, including the terms "believes", "estimates", "plans", "anticipates", "aims", "continues", "expects",
"hopes", "may", "will", "would" or "could" or, in each case, their negative or other various or comparable terminology.
These forward-looking statements, including, among others, those relating to the future business prospects, revenues and income of Gold
Fields, wherever they may occur in this report, are necessarily estimates reflecting the best judgment of the senior management of Gold
Fields and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the
forward-looking statements. As a consequence, these forward-looking statements should be considered in light of various important factors,
including those set forth in this report. Important factors that could cause actual results to differ materially from estimates or projections
contained in the forward-looking statements include, without limitation:
· overall economic and business conditions in South Africa, Ghana, Australia, Peru and elsewhere;
· changes in assumptions underlying Gold Fields’ mineral reserve estimates;
· the ability of the Group to achieve anticipated efficiencies and other cost savings in connection with past and future acquisitions or joint
ventures;
· the ability of the Group to achieve anticipated efficiencies and other cost savings as a result of measures such as retrenchments;
the ability of the Group to achieve anticipated production cost estimates at existing operations, projects or joint ventures as outlined in
this report or as otherwise disclosed;
· the success of the Group’s business strategy, development activities and other initiatives;
· the ability of the Group to comply with requirements that it operate in a sustainable manner and provide benefits to affected
communities;
· decreases in the market price of gold or copper;
· the occurrence of hazards associated with underground and surface gold mining or contagious diseases at Gold Fields’ operations,
projects or joint ventures;
· the occurrence of work stoppages related to health and safety incidents at Gold Fields’ operations, projects or joint ventures;
· the Group’s loss of senior management or inability to hire or retain employees;
· fluctuations in exchange rates, currency devaluations and other macro-economic monetary policies;
· ongoing or future labour disruptions and industrial actions at Gold Fields’ operations, projects or joint ventures;
· power cost increases as well as power stoppages, fluctuations and usage constraints;
· supply chain shortages and increases in the prices of production imports;
· the ability to manage and maintain access to current and future sources of liquidity, capital and credit, including the terms and conditions
of Gold Fields’ facilities and Gold Fields’ overall cost of funding;
· the adequacy of the Group’s insurance coverage;
· the manner, amount and timing of capital expenditures made by Gold Fields on both existing and new mines, mining projects,
exploration project or other initiatives;
· changes in relevant government regulations, particularly labour, environmental, tax, royalty, health and safety, water, regulations and
potential new legislation affecting Gold Fields’ mining and mineral rights;
· fraud, bribery or corruption at Gold Fields’ operations, projects or joint ventures that leads to censure, penalties or negative reputational
impacts; and
· political instability in South Africa, Ghana, Peru or regionally in Africa or South America.
Gold Fields undertakes no obligation to update publicly or release any revisions to these forward-looking statements to reflect events or
circumstances after the date of this report or to reflect the occurrence of unanticipated events.
Gold Fields 2018 RESULTS
7
Results for the Group
Safety
Sadly, South Deep recorded a fatality during October 2018 which
was a machine related incident. This is the first fatality South Deep
has recorded since February 2017 and was also the only fatality
reported for the Group in 2018. The Group’s fatality injury
frequency rate improved from 0.05 in 2017 to 0.02 in 2018. The
total recordable injury frequency rate (TRIFR) for the Group
1
improved by 24 per cent from 2.42 in 2017 to 1.83 in 2018, the best
achieved by the Group.
The strategy of the Group will focus on eliminating fatalities and
serious injuries. In addition, an increased focus is being put on
leading indicators to take safety to the next level, including
increased visible leadership, reporting and close out of hazards
and full roll out of critical control management through design,
engineering and procedural control, as well as behaviour change.
The CEO, executives and senior managers from all regions met in
October 2018 to develop a group-wide safety strategy. While the
details are being fine-tuned, it was agreed that the strategy’s pillars
should be: safety leadership, safe behaviour and systems and
processes. The forum agreed that implementing a courageous
safety leadership programme would refocus and strengthen our
safety efforts and complement existing programmes. Stuart
Matthews, our Group Head of Australia, will be responsible for
leading this global effort to finalise and guide the strategy’s group-
wide rollout.
1 Total Recordable Injury Frequency rate (TRIFR). (TRIFR) = (Fatalities + Lost Time
Injuries
2
+ Restricted Work Injuries
3
+ Medically Treated Injuries
4
) x 1,000,000/ number
of man-hours worked.
2 A Lost Time Injury (LTI) is a work-related injury resulting in the employee or contractor
being unable to attend work for a period of one or more days after the day of the injury.
The employee or contractor is unable to perform any functions.
3 A Restricted Work Injury (RWI) is a work-related injury sustained by an employee or
contractor which results in the employee or contractor being unable to perform one or
more of their routine functions for a full working day, from the day after the injury
occurred. The employee or contractor can still perform some of his duties.
4 A Medically Treated Injury (MTI) is a work-related injury sustained by an employee or
contractor which does not incapacitate that employee and who, after having received
medical treatment, is deemed fit to immediately resume his/her normal duties on the
next calendar day, immediately following the treatment/re-treatment.
For the year ended 31 December 2018
compared with year ended 31 December
2017
Revenue
Attributable equivalent gold production decreased by 6 per cent
from 2.160 million ounces in 2017 to 2.036 million ounces in 2018,
almost exclusively due to the decline in production at South Deep.
Gold production at South Deep in South Africa, decreased by 44
per cent from 8,748 kilograms (281,300 ounces) to 4,885 kilograms
(157,100 ounces).
Attributable gold production at the West African operations
increased by 6 per cent from 639,000 ounces in 2017 to 679,700
ounces in 2018 due to higher production at Damang as well as the
inclusion of 44,500 ounces from Asanko for the five months ending
December 2018. This was partially offset by lower production at
Tarkwa. Attributable equivalent gold production at Cerro Corona
in Peru increased by 2 per cent from 305,200 ounces in 2017 to
312,500 ounces in 2018. Gold production at the Australian
operations decreased by 5 per cent from 934,600 ounces in 2017
to 886,400 ounces in 2018 due to marginally lower production at
Agnew and Granny Smith, partially offset by higher production at
St Ives but mainly due to the exclusion of Darlot in 2018. The
934,600 ounces in 2017, included 39,200 ounces for nine months
only at the discontinued operation, Darlot.
At the South Africa region, production at South Deep decreased
by 44 per cent from 8,748 kilograms (281,300 ounces) in 2017 to
4,885 kilograms (157,100 ounces) in 2018 due to decreased
volumes and grades. This was mainly due to the industrial action,
the restructuring process as well as the fatal accident, further
exacerbated by poor ground conditions in the high grade areas of
the mine.
At the West Africa region, managed gold production at Tarkwa
decreased by 7 per cent from 566,400 ounces in 2017 to 524,900
ounces in 2018 mainly due to lower volumes mined in line with the
2018 planned strategy to reduce mining and optimise margins and
cash flow. At Damang, managed gold production increased by 26
per cent from 143,600 ounces in 2017 to 180,800 ounces in 2018
mainly due to higher head grade and yield. Production at Asanko
amounted to 44,500 ounces for the 5 months ended December
2018.
At the South America region, total managed gold equivalent
production at Cerro Corona increased by 2 per cent from 306,700
ounces in 2017 to 314,100 ounces in 2018 mainly due to the higher
copper price relative to the gold price (price factor) and higher
copper production as a result of higher copper head grade.
At the Australia region, St Ives’ gold production increased by 1 per
cent from 363,900 ounces in 2017 to 366,900 ounces in 2018. At
Agnew, gold production decreased by 1 per cent from 241,200
ounces in 2017 to 239,100 ounces in 2018 mainly due to
decreased ore processed. At Granny Smith, gold production
decreased by 3 per cent from 290,300 ounces in 2017 to 280,400
ounces in 2018 due to lower grades mined. In 2017, gold
production at Darlot amounted to 39,200 ounces for the nine
months to September 2017.
The average US dollar gold price achieved by the Group decreased
marginally from US$1,255 per equivalent ounce in 2017 to
US$1,251 per equivalent ounce in 2018. The average rand gold
price decreased by 1 per cent from R538,344 per kilogram to
R531,253 per kilogram. The average Australian dollar gold price
increased by 3 per cent from A$1,640 per ounce to A$1,694 per
ounce. The average US dollar gold price for the Ghanaian
operations (including Asanko) increased by 1 per cent from
US$1,255 per ounce in 2017 to US$1,265 per ounce in 2018. The
average equivalent US dollar gold price, net of treatment and
refining charges, for Cerro Corona decreased by 6 per cent from
US$1,252 per equivalent ounce in 2017 to US$1,174 per
equivalent ounce in 2018. The average US dollar/Rand exchange
rate strengthened by 1 per cent from R13.33 in 2017 to R13.20 in
2018. The average Australian/US dollar exchange rate weakened
by 3 per cent from A$1.00 = US$0.77 in 2017 to A$1.00 = US$0.75
in 2018.
Revenue decreased by 7 per cent from US$2,762 million in 2017
to US$2,578 million in 2018 due to the lower ounces sold.
Cost of sales before amortisation and depreciation
Cost of sales before amortisation and depreciation increased by 1
per cent from US$1,357 million in 2017 to US$1,375 million in
2018.
At the South Africa region, at South Deep, cost of sales before
amortisation and depreciation decreased by 12 per cent from
R4,062 million (US$305 million) in 2017 to R3,586 million (US$272
million) in 2018 mainly due to lower production as a result of
Gold Fields 2018 RESULTS
8
industrial action, lower expenditure on consumables, contractors,
labour and utility costs, partially offset by a R127 million (US$10
million) gold inventory charge to cost in 2018 compared with a
credit to cost of R21 million (US$2 million) in 2017.
At the West Africa region, cost of sales before amortisation and
depreciation increased by 10 per cent from US$428 million in 2017
to US$471 million in 2018. At Tarkwa, cost of sales before
amortisation and depreciation, increased by 1 per cent from
US$306 million to US$309 million due to a gold-in-process charge
to cost, partially offset by lower mining costs in line with lower
operational tonnes mined. The US$10 million gold-in-process
charge to costs in 2018 compared with a credit to costs of US$42
million in 2017. In 2017, higher volumes were mined and
stockpiled. At Damang, cost of sales before amortisation and
depreciation, increased by 2 per cent from US$122 million in 2017
to US$124 million in 2018 mainly due to higher operating tonnes
mined, partially offset by a gold-in-process credit to costs of
US$19 million in 2018 compared with a charge to costs of US$1
million in 2017. Cost of sales before amortisation and depreciation
at Asanko amounted to US$37 million in 2018.
At the South America region, at Cerro Corona, cost of sales before
amortisation and depreciation increased marginally from US$154
million in 2017 to US$155 million in 2018 mainly due to higher
tonnes mined in 2018.
At the Australia region, cost of sales before amortisation and
depreciation increased by 13 per cent from A$613 million (US$469
million) in 2017 to A$690 million (US$516 million) in 2018. At St
Ives, cost of sales before amortisation and depreciation, increased
by 20 per cent from A$207 million (US$159 million) in 2017 to
A$249 million (US$186 million) in 2018 mainly due to increased
underground mining cost as a result of increased ore tonnes
mined, less cheaper open pit tonnes mined, increased processing
maintenance cost and a lower gold inventory credit to costs.
At Agnew, cost of sales before amortisation and depreciation,
increased by 10 per cent from A$197 million (US$150 million) in
2017 to A$216 million (US$162 million) in 2018 mainly due to
increased mining cost and a gold-in-process charge to cost of A$2
million (US$2 million) in 2018 compared with a credit to costs of
A$6 million (US$5 million) in 2017. At Granny Smith, cost of sales
before amortisation and depreciation, increased by 7 per cent from
A$210 million (US$160 million) in 2017 to A$225 million (US$168
million) in 2018 mainly due to increased mining cost as a result of
mining deeper zones.
Amortisation and depreciation
Amortisation and depreciation for the Group decreased by 11 per
cent from US$748 million in 2017 to US$668 million in 2018. This
decrease was mainly due to the increase in reserves at Cerro
Corona in line with the life extension and at South Deep due to
lower production.
Other
Net interest expense for the Group increased by 6 per cent from
US$63 million in 2017 to US$67 million in 2018. Interest expense
of US$92 million was partially offset by interest income of US$8
million and interest capitalised of US$17 million. In 2017 interest
expense of US$92 million was partially offset by interest income of
US$6 million and interest capitalised of US$23 million.
The share of equity accounted losses increased from US$1 million
in 2017 to US$13 million in 2018 mainly due to the US$12 million
write-off of deferred costs and other non-recoverable amounts at
Far Southeast project (FSE) as well as a loss of US$1 million related
to the Group’s share of equity accounted loss on Asanko.
The gain on foreign exchange of US$6 million in 2018 compared
with a loss of US$4 million in 2017. These gains and losses on
foreign exchange related to the conversion of offshore cash
holdings into their functional currencies.
The gain on financial instruments decreased by 38 per cent from
US$34 million 2017 to US$21 million 2018. In 2018, the US$21
million comprised US$17 million on hedges and US$4 million on
the mark to market on warrants. The US$17 million included
US$54 million realised gains, partially offset by US$37 million
unrealised losses. The gold hedge gains are analysed as follows:
at the Australian operations (a loss of US$5 million/A$5 million), the
Ghanaian operations (a gain of US$22 million) and South Deep (a
loss of US$3 million/R43 million). It also included realised and
unrealised gains and losses on the oil hedges taken out at the
Ghanaian and Australian operations (a gain of US$2 million and
US$1 million/A$2 million, respectively), as well as the copper
hedge taken out at Cerro Corona (gain of US$9 million). In
addition, a currency hedge taken out at the Australian operations
resulted in a loss of US$9 million (A$12 million).
Share-based payments for the Group increased by 41 per cent
from US$27 million in 2017 to US$38 million in 2018 and related to
the current valuation of the share scheme and changes in its
composition. Long-term employee benefits decreased by 80 per
cent from US$5 million to US$1 million due to the current valuation
of the plan.
Other costs for the Group increased by 25 per cent from US$44
million to US$55 million.
Exploration and project costs
Exploration and project costs decreased by 5 per cent from
US$110 million in 2017 to US$104 million in 2018 mainly due a
decrease in the write-off of brownfields exploration costs at the
Australian operations from A$64 million (US$48 million) in 2017 to
A$51 million (US$38 million) in 2018, partially offset by an increase
in expenditure at Salares Norte from US$53 million in 2017 to
US$61 million in 2018. The write-off of brownfields exploration is
a non-cash item. The balance of US$5 million mainly related to
various exploration office costs.
Non-recurring items
Non-recurring expenses of US$633 million in 2018 compared with
US$224 million in 2017.
The non-recurring expenses for 2018 included:
·
impairment of R6.471 billion (US$482 million) in respect of the
South Deep cash-generating unit. The after tax impairment
was R4.819 billion (US$359 million). The impairment was
recognised in June 2018 and given that impairment indicators
still existed at 31 December 2018, a further impairment
assessment was performed.
There were no further impairments at 31 December 2018 using the
following assumptions:
·
Gold price of R525,000 per kilogram for 2019 and
R550,000 per kilogram thereafter;
·
Reserve ounces used in discounted cash flow of 32.4
million ounces;
·
Resource price of US$17 per ounce at a Rand/US dollar
exchange rate of R14.63;
·
Resource ounces of 24.5 million ounces;
·
Life of mine 75 years; and
·
Nominal discount rate of 13.5 per cent.
·
·
restructuring costs at Tarkwa (US$89 million) with the
transition to contractor mining;
restructuring costs at Damang (US$14 million);
9
Gold Fields 2018 RESULTS
·
·
·
·
·
·
restructuring costs at South Deep (US$11 million/R148
million);
losses on the sale of mining fleet and heavy machinery
equipment and inventory at Tarkwa as part of the transition to
contractor mining, amounted to US$38 million and US$9
million, respectively;
silicosis provision adjustment (US$5 million/R60 million);
loss on sale of APP (US$15 million);
impairment of FSE of US$37 million. The impairment of FSE
was based on the fair value less cost of disposal of the
investment which was directly derived from the market value
of Lepanto Consolidated Mining Company; and
Gain on the acquisition of Asanko Gold mine of US$52 million.
The non-recurring expenses in 2017 included mainly:
Cash generating unit impairment of R3.495 billion (US$278
million) at South Deep. The impairment calculation is based
on the 2017 life of mine plan using the following assumptions:
·
Gold price decreased from a long-term R600,000 per
kilogram to R525,000 per kilogram;
·
Resource price decreased from R842 per ounce to R216
per ounce due to a decrease in the dollar price per ounce
from US$60 per ounce to US$17 per ounce and a stronger
Rand/Dollar exchange rate from R14.03 to R12.58. This
was partially offset by an increase in resource ounces of
3.8 million ounces from 25.2 million ounces to 29.0 million
ounces;
·
Life of mine: 77 years; and
·
Discount rate: 13.5 per cent nominal.
The above assumptions do not affect the steady state production
target of circa 500,000 ounces by 2022.
Silicosis provision raised (US$30 million);
Write-off of parked fleet at Tarkwa (US$7 million);
Retrenchment costs (US$9 million) mainly at Tarkwa (US$5
million), South Deep (US$2 million) and Damang (US$2 million);
Write-off of Damang assets (US$3 million); and
Impairment of investments (US$4 million).
This was partially offset by:
Reversal of cash-generating unit impairment: gross US$53
million, tax US$15 million, net US$38 million at Cerro Corona.
The impairment calculation is based on the 2017 life of mine
plan using the following assumptions:
·
Gold price 2018: US$1,200 per ounce, 2019 onwards:
US$1,300 per ounce;
·
Copper price 2018: US$2.50 per pound, 2019 onwards:
US$2.80 per pound;
·
Resource price: US$41 per ounce;
·
Life of mine: 13 years; and
·
Discount rate: 4.8 per cent.
The reversal of the impairment is due to a higher net present value
as a result of the completion of a pre-feasibility study in 2017
extending the life of mine from 2023 to 2030 by optimising the
tailings density and increasing tailings capacity by using in-pit
tailings after mining activities end.
·
·
·
Reversal of the APP impairment (US$39 million);
Profit on the sale of Darlot (US$24 million/A$31 million); and
Lower rehabilitation provisions of US$13 million mainly at St
Ives due to a new mine closure plan (A$15 million/US$11
million).
Royalties
Government royalties for the Group increased marginally from
US$62 million in 2017 to US$63 million in 2018.
Taxation
The taxation credit for the Group of US$66 million in 2018
compared with a charge of US$173 million in 2017. Normal
taxation decreased from US$205 million to US$146 million. The
deferred tax credit of US$212 million in 2018 compared with
US$32 million in 2017.
The significant deferred tax credit arose due to the taxation credit
of R1.652 billion (US$123 million) on the impairment of South
Deep. In addition, as a result of the settlement of the South Deep
tax dispute, Gold Fields has recognised an additional R2.708
billion (US$205 million) of capital allowances with a tax effect of
R812 million (US$62 million).
Discontinued operation – Darlot
The net loss in 2017 from the discontinued operation, Darlot, net
of tax of US$13 million was a result of revenue of A$64 million
(US$49 million), cost of sales before amortisation and depreciation
of A$62 million (US$47 million) with the balance relating to other
costs. The revenue of A$64 million (US$49 million) related to
39,200 ounces sold at a gold price of A$1,637 per ounce
(US$1,252 per ounce).
Loss/profit
Net loss attributable to owners of the parent of US$348 million or
US$0.42 per share in 2018 compared with a loss US$19 million or
US$0.02 per share in 2017.
Headline earnings attributable to owners of the parent of US$61
million or US$0.07 per share in 2018 compared with headline
earnings of US$210 million or US$0.26 per share in 2017.
Normalised profit of US$27 million or US$0.03 per share in 2018
compared with US$154 million or US$0.19 per share in 2017.
Normalised profit
Normalised profit reconciliation for the Group is calculated as
follows:
Year ended
Dec
2018
Dec
2017
Loss from continuing operations
(348.2)
(18.7)
Non-recurring items
633.1
200.4
Tax effect of non-recurring items
(171.1)
10.7
Non-controlling interest effect of non-
recurring items
(10.1)
(0.9)
(Gain)/loss on foreign exchange
(6.4)
3.7
Tax effect of (gain)/loss on foreign exchange
0.6
(1.1)
Gain on financial instruments
(21.0)
(34.8)
Tax effect of gain on financial instruments
5.7
10.9
Non-controlling interest effect of gain on
financial instruments
1.6
0.6
South Deep tax settlement
(61.5)
–
Other tax adjustments
4.2
(17.0)
Normalised profit
26.9
153.8
Normalised profit is considered an important measure by Gold Fields of the profit realised
by the Group in the ordinary course of operations. In addition, it forms the basis of the
dividend pay-out policy. Non-IFRS measures such as normalised results are considered
as pro forma financial information as per the JSE Listing Requirements. The pro forma
financial information is the responsibility of the Group’s Board of Directors and is
presented for illustration purposes only and because of its nature, normalised profit
should not be considered as a representation of earnings.
This pro forma financial information has been reported on by KPMG Inc. in terms of ISAE
3420 and their unmodified report is available for inspection on the Gold Fields website
(www.goldfields.com).
Gold Fields 2018 RESULTS
10
Cash flow
Cash inflow from operating activities of US$613 million in 2018
compared with US$832 million in 2017, a 26 per cent decrease due
to lower gold sold and higher restructuring costs.
Dividends paid/advanced of US$55 million in 2018 compared with
US$69 million in 2017. Dividends paid to owners of the parent
decreased from US$63 million in 2017 to US$46 million in 2018.
Dividends paid to non-controlling interest holders of US$10 million
in 2018 compared with US$6 million in 2017.
Cash outflow from investing activities decreased from US$909
million in 2017 to US$896 million in 2018 due to a decrease in
sustaining capital expenditure mainly at South Deep, Tarkwa and
St Ives, partially offset by an increase in growth capital expenditure
at Gruyere, Damang and South Deep. Capital expenditure
decreased from US$834 million in 2017 to US$814 million in 2018
due to lower sustaining capital expenditure as planned. Growth
expenditure of US$125 million was incurred on the Damang
reinvestment project and A$180 million (US$134 million) was
incurred on Gruyere. In accordance with the Joint Venture
agreement entered into at the time of acquisition, Gold Fields will
fund up to 10 per cent of the cost overrun, excluding scope
changes and force majeure costs. The Gruyere overruns of 10 per
cent will be funded in 2019. This compared with growth
expenditure of US$115 million on the Damang reinvestment
project and A$106 million (US$81 million) on Gruyere. Proceeds
on disposal of assets of US$79 million in 2018 compared with
US$23 million in 2017 and related to disposal of assets as part of
the conversion to contractor mining at Tarkwa in 2018 and
Damang in 2017. Purchase of investments of US$19 million in
2018 compared with US$80 million in 2017. In 2018, it related
mainly to the purchase of shares in Asanko.
Purchase of Asanko of US$165 million related to the Joint Venture
transaction with Asanko Gold (Asanko) which was completed on
31 July 2018. Gold Fields acquired a 50 per cent stake in Asanko’s
90 per cent interest in the Asanko Gold mine in Ghana.
Proceeds on disposal of assets held for sale of US$40 million in
2018 related to the sale of APP.
Cash outflow from operating activities less net capital expenditure,
environmental payments and finance lease payments of US$132
million in 2018 compared with an outflow of US$2 million in 2017.
The US$132 million outflow in 2018 comprised: US$191 million net
cash generated by the seven mining operations (after royalties,
taxes, capital expenditure and environmental payments), less
US$77 million of net interest paid, US$77 million for exploration
mainly at Salares Norte (this excludes any mine based brownfields
exploration which is included in the US$191 million above),
US$163 million (AS$218 million) at Gruyere [capital expenditure of
US$134 million (A$180 million) and an investment into working
capital of US$29 million (A$38 million), mainly due to timing of cash
calls from the EPC contractor], as well as US$6 million on non-
mine based costs. Included in the US$191 million above is
US$125 million capital expenditure on the Damang reinvestment
project and US$18 million on South Deep growth capital
expenditure. If these two amounts are excluded, then the mining
operations generated US$334 million in net cash. Adding back the
negative US$141 million for South Deep, the core international
operations generated US$475 million.
The US$2 million outflow in 2017 comprised: US$309 million net
cash generated by the seven mining operations (after royalties,
taxes, capital expenditure and environmental payments), less
US$72 million of net interest paid, US$58 million for exploration
mainly at Salares Norte (this excludes any mine based brownfields
exploration which is included in the US$309 million above),
US$141 million (A$184 million) at Gruyere [capital expenditure of
US$81 million (A$106 million) and an investment into working
capital of US$60 million (A$78 million), mainly due to cash calls on
the balance of the deferred payment balance and stamp duty], as
well as US$40 million on non-mine based costs. Included in the
US$309 million above is US$115 million capital expenditure on the
Damang reinvestment project and US$17 million on South Deep
growth capital expenditure. If these two amounts are excluded,
then the mining operations generated US$441 million.
In the South Africa region at South Deep, capital expenditure
decreased from R1,099 million (US$82 million) in 2017 to R770
million (US$58 million) in 2018 mainly due to lower expenditure on
fleet and surface infrastructure.
At the West Africa region, (excluding Asanko), capital expenditure
decreased from US$313 million to US$295 million. At Tarkwa,
capital expenditure decreased from US$181 million to US$156
million due to lower capital waste stripping and lower fleet
expenditure as a consequence of the revised optimised life of mine
plan and the conversion from owner mining to contractor mining.
Capital expenditure at Damang increased from US$132 million to
US$139 million mainly due to higher expenditure on the Damang
reinvestment project (US$125 million).
Capital expenditure at Asanko amounted to US$13 million for the
5 months ended December 2018. The Asanko capital expenditure
is not included in the Group capital expenditure.
In the South America region at Cerro Corona, capital expenditure
decreased from US$34 million to US$33 million mainly due to
lower expenditure on the construction of the tailings dam and
waste storage facilities.
At the Australia region, capital expenditure decreased from A$414
million (US$317 million) in 2017 to A$373 million (US$279 million)
in 2018. At St Ives, capital expenditure decreased from A$204
million (US$156 million) in 2017 to A$170 million (US$127 million)
in 2018 due to lower expenditure at the open pits following
completion of activities at Invincible open pit stage 5. At Agnew,
capital expenditure increased from A$96 million (US$74 million) in
2017 to A$98 million (US$73 million) in 2018. At Granny Smith,
capital expenditure decreased from A$114 million (US$87 million)
in 2017 to A$105 million (US$79 million) in 2018 due to completion
of the VR8 ventilation shaft in 2017.
Capital expenditure at the discontinued operation, Darlot,
amounted to A$9 million (US$7 million) in 2017.
Net cash inflow from financing activities of US$257 million in 2018
compared with US$84 million in 2017. The inflow in 2018 related
to a drawdown of US$692 million, partially offset by the repayment
of US$432 million on offshore and local loans and US$3 million
from finance lease payments. The inflow in 2017 related to a
drawdown of US$780 million, partially offset by the repayment of
US$696 million on offshore and local loans.
The net cash outflow for the Group of US$72 million in 2018
compared with US$62 million in 2017. The cash balance of
US$400 million in 2018 compared with US$479 million in 2017.
All-in sustaining and total all-in cost
The Group all-in sustaining costs increased by 3 per cent from
US$955 per ounce in 2017 to US$981 per ounce in 2018 mainly
due to lower gold sold, partially offset by lower cost of sales before
amortisation and depreciation and lower sustaining capital
expenditure. Total all-in cost increased by 8 per cent from
11
Gold Fields 2018 RESULTS
US$1,088 per ounce in 2017 to US$1,173 per ounce in 2018 for
the same reasons as for all-in sustaining costs and due to higher
non-sustaining capital expenditure and higher exploration,
feasibility and evaluation costs.
In the South Africa region, at South Deep, all-in sustaining costs
increased by 41 per cent from R574,406 per kilogram (US$1,340
per ounce) to R807,688 per kilogram (US$1,903 per ounce) mainly
due to lower gold sold, partially offset by lower cost of sales before
amortisation and depreciation and lower sustaining capital
expenditure. The total all-in cost increased by 42 per cent from
R600,109 per kilogram (US$1,400 per ounce) to R854,049 per
kilogram (US$2,012 per ounce) due to the same reasons as for all-
in sustaining costs as well as higher non-sustaining capital
expenditure.
At the West Africa region, all-in sustaining costs decreased by 3
per cent from US$958 per ounce in 2017 to US$926 per ounce in
2018 mainly due to higher gold sold and lower sustaining capital
expenditure, partially offset by higher cost of sales before
amortisation and depreciation. Results for Asanko were included
for 5 months in 2018. Total all-in cost decreased by 2 per cent
from US$1,119 per ounce in 2017 to US$1,098 per ounce in 2018
due to the same reasons as for all-in sustaining costs and higher
non-sustaining capital expenditure of US$125 million on the
Damang reinvestment project and US$5 million at Asanko.
At the South America region, all-in sustaining costs and total all-in
cost increased by 39 per cent from US$203 per ounce to US$282
per ounce mainly due to lower gold sold, lower by-product credits,
and higher cost of sales before amortisation and depreciation,
partially offset by lower capital expenditure. All-in sustaining costs
and total all-in cost per equivalent ounce increased by 4 per cent
from US$673 per equivalent ounce to US$699 per equivalent
ounce mainly due to the same reasons as above as well as lower
equivalent ounces sold.
At the Australia region, all-in sustaining costs and total all-in cost
increased by 4 per cent from A$1,210 per ounce (US$926 per
ounce) in 2017 to A$1,262 per ounce (US$943 per ounce) in 2018
mainly due to higher cost of sales before amortisation and
depreciation and lower gold sold, partially offset by lower capital
expenditure.
Statement of financial position
Net debt (borrowings plus the current portion of borrowings less
cash and cash equivalents) increased from US$1,303 million for
the year ended December 2017 to US$1,612 million for the year
ended December 2018.
Net debt/adjusted EBITDA
The net debt/adjusted EBITDA ratio of 1.45 at 31 December 2018
compared with 1.03 at the end of the financial year ended 31
December 2017.
Adjusted EBITDA
Adjusted EBITDA for calculating net debt/EBITDA is based on the
previous 12 months earnings, which is determined as follows in
US$ million:
Reconciliation between revenue less cost of sales before
amortisation and depreciation and adjusted EBITDA for the
year ended:
Dec
2018
Dec
2017
Revenue
2,578
2,762
Cost of sales before amortisation
and depreciation
(1,375)
(1,357)
Environmental rehabilitation interest
12
12
Exploration and project costs
(104)
(110)
Other
1
(43)
Adjusted EBITDA
1,112
1,264
Non-IFRS measures such as adjusted EBITDA are considered as pro forma financial
information as per the JSE Listing Requirements. The pro forma financial information is
the responsibility of the Group’s Board of Directors and is presented for illustration
purposes only and because of its nature, adjusted EBITDA should not be considered a
representation of earnings. Adjusted EBITDA is required to be determined in terms of
the loan and revolving credit facilities agreements to evaluate compliance with
covenants.
This pro forma financial information has been reported on by KPMG Inc. in terms of ISAE
3420 and their unmodified report is available for inspection on the Gold Fields website
(www.goldfields.com).
Free Cash flow margin
The free cash flow (FCF) margin is revenue less cash outflow
divided by revenue expressed as a percentage. The FCF for the
Group for the year ended 2018 is calculated as follows:
US$’m
US$/oz
Revenue*
2,406.6
1,266
Less: Cash outflow
(2,032.6)
(1,069)
AIC
(2,228.3)
(1,172)
Adjusted for
Share-based payments
(non-cash)
37.5
20
Long-term employee benefits
(non-cash)
1.1
1
Exploration, feasibility and evaluation
costs outside of existing operations
78.2
41
Non-sustaining capital expenditure
(Damang Reinvestment and Gruyere)
272.1
143
Revenue hedge
41.7
22
LTIP payment
(17.8)
(9)
Tax paid (excluding royalties which is
included in AIC above)
(217.1)
(114)
Free cash flow**
374.0
197
FCF margin
16%
Gold sold only – 000’ounces
1,900.5
* Revenue from income statement at US$2,577.8 million less revenue from by-products
in AIC at US$171.2 million equals US$2,406.6 million.
** Free cash flow does not agree with cash flows from operating activities less capital
expenditure in the statement of cash flows on page 26 mainly due to working capital
adjustments and non-recurring items included in the statement of cash flows.
Non-IFRS measures such as free cash flow margin are considered as pro forma financial
information as per the JSE Listing Requirements. The pro forma financial information is
the responsibility of the Group’s Board of Directors and is presented for illustration
purposes only and because of its nature, free cash flow margin should not be considered
a representation of earnings. The free cash flow margin is used as a key metric in the
determination of the long-term incentive plan.
This pro forma financial information has been reported on by KPMG Inc. in terms of ISAE
3420 and their unmodified report is available for inspection on the Gold Fields website
(www.goldfields.com).
The FCF margin of 16 per cent in 2018 at a gold price of US$1,252
per ounce compared with 16 per cent in 2017 at a gold price of
US$1,259 per ounce. The FCF margin for 2018 meets the Group’s
target of a 15 per cent FCF margin at a gold price of US$1,300 per
ounce.
Gold Fields 2018 RESULTS
12
Continuing operations
South Africa region
South Deep Project
Year ended
Dec
2018
Dec
2017
Gold produced
000’oz
157.1
281.3
kg
4,885
8,748
Gold sold
000’oz
167.8
281.8
kg
5,220
8,766
Yield – underground reef
g/t
5.85
5.87
AISC
R/kg
807,688
574,406
US$/oz
1,903
1,340
AIC
R/kg
854,049
600,109
US$/oz
2,012
1,400
Regrettably, a tragic accident occurred on 12 October 2018 fatally
injuring Mr. Ananias Mosololi. The mine was issued with a Section
54 instruction, halting mobile machinery and secondly to conduct
an investigation. A partial upliftment was issued on 18 October
2018 with a full upliftment on 31 October 2018. 18 days of
production was either lost or significantly impacted. The fatality
occurred shortly after the mine had achieved 2 million fatality free
shifts following 18 months of being fatality free.
South Deep embarked on a restructuring process on 14 August
2018 as reported in the September quarter. The prescribed
consultation process was concluded on 28 October 2018
culminating in the retrenchment of 1,092 permanent employee’s
and 420 contractors. The majority union, the NUM, obtained a
certificate of non-resolution from the CCMA and issued a notice of
intended industrial action on 31 October 2018. The protected
industrial action commenced on 2 November 2018 and lasted 6
weeks. Employees participating in the industrial action blocked all
roads to the mine, limiting access and the ability to continue with
any mining operations. Production was therefore suspended and
essential services continued on an intermittent basis when access
was possible. Negotiations with all levels of the union (branch,
regional and national) concluded on 18 December 2018 with the
signing of a new agreement that ended the industrial action. The
mine gradually resumed operations from 15 December 2018. The
process had a profound impact on production with the operations
suspended for 41 days with a preceding “go slow” and acts of
sabotage as from the announcement of restructuring. It took an
additional 8 days to start-up the underground sections post 15
December 2018.
Gold production decreased by 44 per cent from 8,748 kilograms
(281,248 ounces) in 2017 to 4,885 kilograms (157,043 ounces) in
2018 due to decreased volumes. In addition to the above-
mentioned incidences, production in 2018 was impacted by
extensive rehabilitation work in the main access ramps during the
year as well as a management restructuring process conducted in
the March 2018 quarter. Production was also impacted by
geotechnical constraints (associated with the previous low profile
destress cuts which were converted to high profile crush pillar
design) and exacerbated by geological features in front of these
cuts (Fargo 2 fault in corridor 4 and the Gray ghost dyke on corridor
3). These pillars were deteriorating faster than anticipated, causing
seismicity and increasingly difficult stoping and backfilling
conditions. A faster stoping sequence was designed to manage
the deteriorating ground conditions. To enable mining to progress
in corridor 3, a bracket pillar was designed around the Grey ghost
dyke. Destress is planned to commence on the opposite side of
the pillar, but in the process 92,000 ounces of gold reserves were
sterilised. Geotechnical conditions are expected to improve once
we transition away from the low profile cuts and old pillar design.
Total underground tonnes mined decreased by 35 per cent from
1.61 million tonnes in 2017 to 1.04 million tonnes in 2018.
Underground ore tonnes mined decreased by 41 per cent from
1.42 million tonnes in 2017 to 0.84 million tonnes in 2018.
Underground reef grade increased by 3 per cent from 5.89 grams
per tonne to 6.04 grams per tonne in 2018. Underground waste
mined increased by 6 per cent from 188,670 tonnes to 200,492
tonnes as a result of increased footwall infrastructure, capital
waste development and development to establish infrastructure
for new destress cuts. Gold mined from underground decreased
by 40 per cent from 8,364 kilograms (268,900 ounces) to 5,048
kilograms (162,300 ounces). Underground grade mined (ore and
waste) decreased by 6 per cent from 5.20 grams per tonne in 2017
to 4.87 grams per tonne in 2018 as a result of ore tonnes mined as
a percentage of total tonnes mined decreasing from 88 per cent to
81 per cent.
Total tonnes milled decreased by 37 per cent from 2.08 million
tonnes in 2017 to 1.32 million tonnes in 2018. Underground ore
tonnes milled decreased by 44 per cent from 1.48 million tonnes in
2017 to 0.83 million tonnes in 2018. Underground waste milled
increased by 27 per cent from 165,000 tonnes to 210,000 tonnes.
Surface tailings material treated decreased by 35 per cent from
433,408 tonnes to 281,607 tonnes. Underground reef yield
decreased slightly from 5.87 grams per tonne to 5.85 grams per
tonne.
Development decreased by 27 per cent from 6,897 metres in 2017
to 5,047 metres in 2018. New mine capital development (phase
one, sub 95 level) increased by 1 per cent from 976 metres in 2017
to 988 metres in 2018. Capital footwall development on 100 level
and below was suspended during the restructuring process in the
September quarter, as it was ahead of schedule. On reef-plane
stope access development and destress cut access development
decreased by 31 per cent from 5,921 metres in 2017 to 4,059
metres in 2018 due to the suspension of development activities in
87 1W and 2W in the September quarter. The suspension of
activities in the section formed part of the restructuring process.
Destress attributable square metres mined decreased by 44 per
cent from 33,419 square metres in 2017 to 18,793 square metres
in 2018 due to the implementation of a new support standard and
related backlog catch-up together with negotiation of geological
features as well as a result of the industrial action from the
restructuring process.
Longhole stoping volume mined decreased by 40 per cent from
766,857 tonnes in 2017 to 463,348 tonnes in 2018 mainly due to
the backfill leakages in the stopes, restructuring, as well as the
industrial action.
The current mine (95 level and above) contributed 55 per cent of
the ore tonnes in 2018, while the new mine (North of Wrench)
contributed 45 per cent.
The mine implemented six key focus areas through a business
improvement framework to drive improved performance and a
number of supporting initiatives and projects are being initiated.
The six focus areas are:
· Enabling Visible Felt Leadership (PVFL);
· Reinvigorating our leadership system;
· Improving face time;
· Effective face time
· Enabling logistics; and
· Implementing of innovation and technology.
These initiatives have started to yield positive results, notably, a 45
per cent improvement in total recordable injury rates as well as a
reduction on the lost time injuries. In addition, there has been a
13
Gold Fields 2018 RESULTS
marginal and steady improvement in the reliability of equipment
(high profile rigs in particular), improvement in the shaft schedule
arrangements and improvements in excavation quality and face
advance.
Cost of sales before amortisation and depreciation, decreased by
12 per cent from R4,062 million (US$305 million) in 2017 to R3,586
million (US$272 million) in 2018. The decrease was mainly due to
lower production exacerbated by the industrial action in the
December quarter. Cost of sales before gold inventory change and
amortisation and depreciation decreased by 15 per cent from
R4,083 million (US$306 million) in 2017 to R3,459 million (US$262
million) in 2018 due to the industrial action in November and
December 2018. The re-setting of the fixed cost base through the
restructuring that amounted to R148 million (paid as separation
packages) is planned to realise savings of ~R600 million in 2018
terms on the labour bill in 2019 (If the restructuring did not take
place, the labour bill for 2019 would have been R1.9 billion against
the current plan of R1.3 billion). Consumable costs decreased as
a result of tighter cost management through the implementation of
bills of material on mining consumables and standards and norms
on metallurgical plant consumables. Contractor costs decreased
as a result of the completion of the artisan training by various
business partners in 2017. Labour costs decreased due to the
restructuring in 2018, control around overtime and fixed
allowances and lower bonuses paid as a result of lower production.
Utilities were lower year on year as a result of lower production and
lower consumption during the strike period in the December 2018
quarter. This was partially offset by a gold inventory charge to cost
of R127 million (US$10 million) in 2018 compared with a gold
inventory credit to cost of R21 million (US$2 million) in 2017.
Capital expenditure decreased by 30 per cent from R1,099 million
(US$82 million) in 2017 to R770 million (US$58 million) in 2018.
Sustaining capital expenditure decreased by 40 per cent from
R874 million (US$66 million) in 2017 to R528 million (US$40 million)
in 2018 mainly due to lower spend on fleet, and surface
infrastructure. Non-sustaining capital expenditure increased by 8
per cent from R225 million (US$17 million) to R242 million (US$18
million) due to higher expenditure on new mine development
infrastructure and more metres developed compared to 2017.
All-in sustaining costs increased by 41 per cent from R574,406 per
kilogram (US$1,340 per ounce) in 2017 to R807,688 per kilogram
(US$1,903 per ounce) in 2018 mainly due to lower gold sold,
partially offset by lower sustaining capital expenditure and lower
cost of sales before amortisation and depreciation.
Total all-in cost increased by 42 per cent from R600,109 per
kilogram (US$1,400 per ounce) in 2017 to R854,049 per kilogram
(US$2,012 per ounce) in 2018 due to the same reasons as for all-
in sustaining costs as well as higher non-sustaining capital
expenditure.
Guidance
The estimate for calendar 2019 is as follows:
· Gold produced ~ 6,000 kilograms (193,000 ounces) of which
99,615 ounces of gold were hedged at an average price of
R616,581 per kilogram
· Destress square metres ~ 30,000 square meters
· Development metres ~ 6,182 meters
· Sustaining capital expenditure ~ R490 million (US$36 million),
reduction of R280 million (US$21 million) compared with 2018;
· Non-sustaining capital expenditure ~ Rnil (US$nil)
· Cost of sales before amortisation and depreciation ~ R3.2
billion (US$238 million), reduction of R600 million (US$75 million)
compared with 2018, which includes a planned labour
bill decrease of ~ R400 million (US$30 million)
· All-in sustaining costs ~ R610,000 per kilogram (US$1,394 per ounce)
· Total all-in cost ~ R610,000 per kilogram (US$1,394 per ounce)
West Africa region
Ghana
Tarkwa
Year
ended
Dec
2018
Dec
2017
Gold produced
000’oz
524.9
566.4
Gold sold
000’oz
524.9
566.4
Yield
g/t
1.18
1.30
AISC and AIC
US$/oz
951
940
As planned, gold production decreased by 7 per cent from 566,400
ounces in 2017 to 524,900 ounces in 2018 due to lower volumes
and lower grades mined.
Total tonnes mined, including capital stripping, decreased by 14
per cent from 103.8 million tonnes in 2017 to 89.6 million tonnes in
2018. Ore tonnes mined decreased by 15 per cent from 16.7
million tonnes to 14.2 million tonnes. Operational waste tonnes
mined decreased by 30 per cent from 35.5 million tonnes to 25.0
million tonnes and capital waste tonnes mined decreased by 2 per
cent from 51.6 million tonnes to 50.4 million tonnes. The decrease
was mainly due to change in strategy to reduce mining volume
from 100 million tonnes per annum to 85 million tonnes per annum
and the focus on capital waste strip. Head grade mined decreased
by 5 per cent from 1.32 grams per tonne to 1.26 grams per tonne.
Gold mined decreased by 20 per cent from 711,000 ounces to
572,100 ounces. The overall reduction of total mined tonnes,
capital stripping, ore tonnes mined and head grade mined was
mainly due to a change in strategy to reduce mining volumes from
100 million tonnes per annum to 85 million tonnes per annum in
line with the 2018 plan. This will sustain a long term cost effective
production profile of around 500,000 ounces per year for the next
decade and likely beyond with further possible extension to
existing pits. The strip ratio increased from 5.2 to 5.3.
The CIL plant throughput increased by 2 per cent from 13.5 million
tonnes in 2017 to 13.8 million tonnes in 2018 due to increased
plant availability. Realised yield from the CIL plant decreased by 9
per cent from 1.30 grams per tonne to 1.18 grams per tonne due
to lower head grade mined and processing of 2.4 million tonnes of
stockpiles at 0.73 grams per tonne. This compared with 1.2 million
tonnes of stockpiles processed in 2017 at a grade of 0.76 grams
per tonne. Medium grade stockpiles were processed in 2018,
while stockpiling lower grade material mined.
Cost of sales before amortisation and depreciation, increased by
1 per cent from US$306 million in 2017 to US$309 million in 2018
due to a gold-in-process charge to cost, partially offset by lower
mining costs in line with lower operational tonnes mined. The
US$10 million gold-in-process charge to costs in 2018 compared
with a credit to costs of US$42 million in 2017. In 2017, higher
volumes were mined and stockpiled compared to 2018.
Capital expenditure decreased by 14 per cent from US$181 million
to US$156 million mainly due to lower expenditure on capital waste
stripping and mining fleet. Mining fleet expenditure including
componentisation was US$4 million in 2018 compared with US$33
million in 2017. This was mainly due to transitioning to contract
mining and the transfer of the mining fleet to the mining contractors.
Gold Fields 2018 RESULTS
14
All-in sustaining costs and total all-in cost increased by 1 per cent
from US$940 per ounce in 2017 to US$951 per ounce in 2018 due
to higher cost of sales before amortisation and depreciation and
lower gold sold, partially offset by lower capital expenditure.
Guidance
The estimate for calendar 2019 is as follows:
· Gold produced ~ 514,000 ounces. The lower gold is in line
with the revised life of mine plan
· Capital expenditure ~ US$113 million
· All-in sustaining costs ~ US$949 per ounce
· Total all-in cost ~ US$949 per ounce
Damang
Year
ended
Dec
2018
Dec
2017
Gold produced
000’oz
180.8
143.6
Gold sold
000’oz
180.8
143.6
Yield
g/t
1.34
0.97
AISC
US$/oz
813
1,027
AIC
US$/oz
1,506
1,827
Gold production increased by 26 per cent from 143,600 ounces in
2017 to 180,800 ounces in 2018 mainly due to higher head grade
and yield.
Total tonnes mined, including capital stripping, increased by 16 per
cent from 39.7 million tonnes in 2017 (25.7 million tonnes from
Amoanda and other satellite pits and 14.0 million tonnes from the
Damang Pit Cut Back (DPCB) to 45.9 million tonnes in 2018 (15.2
million tonnes from Amoanda and other satellite pits and 30.7
million tonnes from the DPCB) due to improved operational
performance from the contractors’ mining fleet and improved
mining efficiencies.
Ore tonnes mined increased by 36 per cent from 3.3 million tonnes
to 4.5 million tonnes mainly from Amoanda pit area where the ore
zones are exposed. Operational waste tonnes mined increased by
47 per cent from 5.3 million tonnes to 7.8 million tonnes mainly as
a result of mining capital waste tonnes in 2017, to align with the new
mining strategy. Capital waste tones mined increased by 8 per
cent from 31.1 million tonnes in 2017 to 33.6 million tonnes in 2018
mainly due to higher volumes mined from the DPCB pits which are
in the early stages of the current cutback. Head grade mined
increased by 46 per cent from 1.15 grams per tonne in 2017 to 1.68
grams per tonne in 2018 due to high grade ore mined from
the Amoanda pits. Gold mined increased by 97 per cent from 122,700
ounces to 242,300 ounces. The strip ratio decreased from 10.9
to 9.2 due to exposed ore surfaces mined at the Amoanda pit.
Tonnes processed decreased by 8 per cent from 4.59 million
tonnes in 2017 to 4.21 million tonnes in 2018 due to lower plant
overall equipment availability as a result of a planned 16 day
shutdown to replace the SAG mill shell. Yield increased by 38 per
cent from 0.97 grams per tonne to 1.34 grams per tonne due to
higher feed grade. In 2018, 3.38 million tonnes of fresh ore and
oxides were milled at an average grade of 1.67 grams per tonne
and 0.83 million tonnes of stockpiles were milled at an average
grade of 0.74 grams per tonne. This compared with 2.83 million
tonnes of fresh ore and oxides that was milled at an average grade
of 1.16 grams per tonne and 1.76 million tonnes of stockpiles that
was milled at an average grade of 0.68 grams per tonne in 2017.
The stockpiles at 31 December 2018 consisted of the ROM
stockpile of 0.8 million tonnes at a grade of 1.30 grams per tonne
and a crushed ore stockpile of 0.2 million tonnes at a grade of 1.59
grams per tonne.
Cost of sales before amortisation and depreciation, increased by
2 per cent from US$122 million in 2017 to US$124 million in 2018
mainly due to higher operating tonnes mined, partially offset by a
gold-in-process credit to costs of US$19 million in 2018 compared
with a charge to costs of US$1 million in 2017.
Capital expenditure increased by 5 per cent from US$132 million
to US$139 million.
Sustaining capital expenditure decreased by 18 per cent from
US$17 million in 2017 to US$14 million in 2018, mainly due to the
pre-development work on the Damang reinvestment project in
2017. Non-sustaining capital expenditure increased by 9 per cent
from US$115 million to US$125 million mainly due to higher capital
waste mined (34 million tonnes mined in 2018 compared with 31
million tonnes mined in 2017).
All-in sustaining cost decreased by 21 per cent from US$1,027 per
ounce in 2017 to US$813 per ounce in 2018 due to higher gold
sold and lower sustaining capital expenditure, partially offset by
higher cost of sales before amortisation and depreciation.
Total all-in cost decreased by 18 per cent from US$1,827 per
ounce in 2017 to US$1,506 per ounce in 2018 due to the same
reasons as for all-in sustaining cost, partially offset by increased
non-sustaining capital expenditure.
Guidance
The estimate for calendar 2019 is as follows:
· Gold produced ~ 218,000 ounces
· Sustaining capital expenditure ~ US$6 million
· Growth capital expenditure ~ US$69 million
· All-in sustaining costs ~ US$786 per ounce
· Total all-in cost ~ US$1,100 per ounce
Asanko (Equity accounted Joint Venture)
Dec
2018
Dec
2017
5 months ended
Gold produced
000’oz
98.9
–
Gold sold
000’oz
102.1
–
Yield
g/t
1.50
–
AISC
US$/oz
1,069
–
AIC
US$/oz
1,175
–
All figures in table 100 per cent basis
Gold production for the five months ended December 2018 was
98,900 ounces.
Total tonnes mined for the five months ended December 2018
were 16.9 million tonnes. Ore tonnes mined were 2.5 million
tonnes. Head grade mined was 1.48 grams per tonne.
Total waste tonnes mined was 14.3 million tonnes. The strip ratio
was 5.7 for the five months ended December 2018.
The plant throughput was 2.1 million tonnes for the five months
ended December 2018 and yield was 1.50 grams per tonne.
Cost of sales before amortisation and depreciation for the five
months ended December 2018 was US$83 million.
Sustaining capital expenditure for the five months ended
December 2018 was US$18 million. Non-sustaining capital
expenditure amounted to US$11 million and included construction
of the haul road and other expenditure related to the Esaase
project, which commenced production in early 2019.
15
Gold Fields 2018 RESULTS
All-in sustaining costs and total all-in cost for the five months
ended December 2018 was US$1,069 per ounce and US$1,175
per ounce, respectively.
Gold Fields’ 45 per cent share of gold produced and gold sold for
the 5 months ending December 2018 amounted to 44,500 ounces
and 45,900 ounces, respectively. Gold Fields share of cost of
sales before amortisation and depreciation amounted to US$37
million and that of sustaining capital expenditure and non-
sustaining capital expenditure amounted to US$8 million and US$5
million, respectively. The above translates to a US$1 million loss
related to the Group’s share of equity accounted losses.
Guidance
The estimate for calendar 2019 is as follows:
· Gold produced ~ 225,000 ounces to 245,000 ounces
· Sustaining capital expenditure ~ US$7 million
· Growth capital expenditure ~ US$18 million
· All-in sustaining costs ~ US$1,040 per ounce to US$1,060
per ounce
· Total all-in cost ~ US$1,130 per ounce to US$1,150 per
ounce
· Gold Fields share of production ~ 101,000 ounces to
110,000 ounces
The large Western pushback at the Nkran pit will result in the strip
ratio and mining costs remaining elevated during 2019. However,
the strip levels at Nkran normalise in 2020, at which point the
higher-grade production from the shallow Esaase oxides will be
ramping up, having a material positive impact on unit costs. In
addition, Gold Fields is working with our JV partners on a cost
optimisation exercise which is expected to result in further cost
reductions. We will provide updated near-term guidance on costs
when we release the updated life of mine plan in H2 2019. Which
update will take account of the longer term potential of the Esaase
project which is expected to become the centre of gravity for the
operation.
South America region
Peru
Cerro Corona
Year
ended
Dec
2018
Dec
2017
Gold produced
000’oz
149.9
159.0
Copper produced
tonnes
32,000
30,200
Total equivalent gold produced
000’eq oz
314.1
306.7
Total equivalent gold sold
000’eq oz
299.1
313.8
Yield
– gold
g/t
0.73
0.76
– copper
per cent
0.50
0.46
– combined
eq g/t
1.47
1.40
AISC and AIC
US$/oz
282
203
AISC and AIC
US$/eq oz
699
673
Gold price*
US$/oz
1,271
1,255
Copper price*
US$/t
6,547
6,131
*
Average daily spot price for the period used to calculate total equivalent gold ounces
produced.
Gold production decreased by 6 per cent from 159,000 ounces in
2017 to 149,900 ounces in 2018. Copper production increased by
6 per cent from 30,200 tonnes to 32,000 tonnes. Equivalent gold
production increased by 2 per cent from 306,700 ounces to
314,100 ounces. The increase in equivalent gold production was
due to the higher copper price ratio as well as higher copper
production due to higher copper head grade. Gold head grade
decreased by 2 per cent from 1.08 grams per tonne to 1.06 grams
per tonne and copper head grade increased by 8 per cent from
0.52 per cent to 0.56 per cent.
Gold recoveries decreased by 3 per cent from 70.4 per cent to 68.1
per cent with ore processed from the south zone of the pit with a
higher clay content, typically with different metallurgical behaviour.
.
Copper recoveries decreased by 1 per cent from 88.9 per cent to
88.0 per cent. Gold yield decreased by 4 per cent from 0.76 grams
per tonne to 0.73 grams per tonne. Copper yield increased by 9
per cent from 0.46 per cent to 0.50 per cent.
In 2018, concentrate with a payable content of 141,041 ounces of
gold was sold at an average price of US$1,254 per ounce and
30,742 tonnes of copper was sold at an average price of US$5,767
per tonne, net of treatment and refining charges. This compared
with 164,715 ounces of gold that was sold at an average price of
US$1,261 per ounce and 30,377 tonnes of copper that was sold at
an average price of US$5,546 per tonne, net of treatment and
refining charges in 2017. Total equivalent gold sales decreased by
5 per cent from 313,800 ounces in 2017 to 299,100 ounces in 2018
due to lower gold produced and higher concentrate stock on hand
in December 2018.
Total tonnes mined increased by 38 per cent from 15.75 million
tonnes in 2017 to 21.78 million tonnes in 2018 in line with the mining
squence and life extensio plan. Ore mined decreased by
3 per cent from 7.09 million tonnes to 6.85 million tonnes. Waste
tonnes mined increased by 72 per cent from 8.66 million tonnes to
14.93 million tonnes. The strip ratio increased from 1.22 to 2.18 as
a result of the increased waste mined in 2018.
Ore processed decreased by 2 per cent from 6.80 million tonnes
in 2017 to 6.64 million tonnes in 2018 mainly due to lower plant
throughput (802 tonnes per hour in 2018 versus 815 tonnes per
hour in 2017) and lower utilisation due to harder ore.
Cost of sales before amortisation and depreciation, increased
marginally from US$154 million in 2017 to US$155 million in 2018.
The higher cost was due to higher mining expenditure as a result of
increased tonnes mined in 2018, partially offset by a US$6 million
credit to costs of concentrate inventory in 2018 compared with a
US$3 million charge to costs in 2017
Capital expenditure decreased by 3 per cent from US$34 million
to US$33 million due to lower expenditure on the tailings dam and
waste storage facilities.
All-in sustaining costs and total all-in cost increased by 39 per cent
from US$203 per ounce in 2017 to US$282 per ounce in 2018,
mainly due to lower by-product credits, lower gold sold and higher
cost of sales before amortisation and depreciation. All-in
sustaining costs and total all-in costs per equivalent ounce
increased by 4 per cent from US$673 per equivalent ounce to
US$699 per equivalent ounce mainly due to the same reasons as
above and lower equivalent ounces sold.
Guidance
The estimate for calendar 2019 is as follows:
· Gold equivalents produced ~ 291,000 ounces
· Gold only produced ~ 153,000 ounces
· Copper tonnes produced ~ 27,684 tonnes
· Capital expenditure ~ US$55 million
· Copper price ~ US$2.70 per pound
· Gold price ~ US$1,200 per ounce
· All-in sustaining costs ~ US$802 per equivalent ounce
· Total all-in cost ~ US$802 per equivalent ounce
· All-in sustaining costs ~ US$566 per ounce
· Total all-in cost ~ US$566 per ounce
For purposesof
calculating equivalent ounces
Gold Fields 2018 RESULTS
16
The decrease in copper tonnes produced is due to lower copper
head grades based on mining sequence.
The increase in capital expenditure is due to construction of the
waste storage facilities (WSF) as part of the 2030 Lom expansion.
Australia region
St Ives
Year
ended
Dec
2018
Dec
2017
Gold produced
000’oz
366.9
363.9
Gold sold
000’oz
367.0
363.9
Yield
– underground
g/t
3.85
3.92
– surface
g/t
2.42
2.56
– combined
g/t
2.69
2.70
AISC and AIC
A$/oz
1,207
1,198
US$/oz
902
916
Gold production increased by 1 per cent from 363,900 ounces in
2017 to 366,900 ounces in 2018.
Total tonnes mined decreased by 49 per cent from 42.63 million
tonnes in 2017 to 21.67 million tonnes in 2018. Gold mined
decreased by 6 per cent from 438,500 ounces to 412,000 ounces.
At the underground operations, ore mined increased by 90 per cent
from 0.48 million tonnes in 2017 to 0.91 million tonnes in 2018 due
to the commissioning of the new Invincible underground mine
during 2018. The grade mined decreased by 1 per cent from 4.13
grams per tonne to 4.08 grams per tonne and contained gold
mined from underground increased by 86 per cent from 64,200
ounces in 2017 to 119,400 ounces in 2018.
At the open pits total ore tonnes mined decreased by 15 per cent
from 3.98 million tonnes in 2017 to 3.40 million tonnes in 2018 as
a result of the completion of mining activities at the Invincible open
pit stage 5 in September 2018. Grade mined decreased by 8 per
cent from 2.92 grams per tonne to 2.68 grams per tonne with lower
grade areas of the Neptune pit mined in 2018. Contained gold
mined from the open pits decreased by 22 per cent from 374,300
ounces in 2017 to 292,600 ounces in 2018.
Operational waste tonnes mined decreased by 35 per cent from
9.03 million tonnes in 2017 to 5.84 million tonnes in 2018. Capital
waste tonnes mined decreased by 60 per cent from 29.12 million
tonnes to 11.52 million tonnes. The decrease in waste tonnes
mined was as a result of the pre-strip being completed at Invincible
mine. The strip ratio decreased from 9.6 to 5.1.
At the consolidated St Ives mine, ounces mined decreased by 6
per cent from 438,500 ounces in 2017 to 412,000 ounces in 2018.
In 2018, Neptune high-grade oxide material stockpiled amounted
to 47,700 ounces (763,100 tonnes at 1.94 grams per tonne),
Invincible amounted to 100 ounces (2,000 tonnes at 1.94 grams
per tonne) and A5 amounted to 7,900 ounces (174,000 tonnes at
1.41 grams per tonne). This compared with stockpiles of 45,600
ounces (711,000 tonnes at 1.99 grams per tonne) at Neptune,
Invincible of 7,800 ounces (109 tonnes at 2.21 grams per tonne)
and A5 of 7,900 ounces (174,000 tonnes at 1.46 grams per tonne)
Currently, Lefroy mill can only sustain a 25 per cent oxide material
blend, thus constraining the processing of Neptune ore.
Throughput at the Lefroy mill increased by 1 per cent from 4.20
million tonnes in 2017 to 4.25 million tonnes in 2018. Yield
decreased marginally from 2.70 grams per tonne to 2.69 grams per
tonne. Gold production from the Lefroy mill increased by 1 per
cent from 363,900 ounces in 2017 to 366,900 ounces in 2018.
Cost of sales before amortisation and depreciation, increased by
20 per cent from A$207 million (US$159 million) in 2017 to A$249
million (US$186 million) in 2018. The higher cost of sales before
amortisation and depreciation was due to increased underground
mining cost as a result of increased ore tonnes mined at Invincible
underground mine (A$18 million/US$14 million) and as a result of
the loss of economies of scale at the open pits due to the large
decrease in mining volumes as Invincible stage 5 moved to
completion (completed at end of September 2018), as well as
lower volumes from Neptune, increased processing maintenance
cost (A$4 million/US$3 million) and a lower gold inventory credit to
costs (A$20 million/US$15 million) in 2018 compared with A$38
million (US$29 million) in 2017.
Capital expenditure decreased by 17 per cent from A$204 million
(US$156 million) in 2017 to A$170 million (US$127 million) in 2018
mainly due to lower capital development in the open pits following
completion of mining activities at Invincible open pit stage 5 (A$54
million/US$41 million), partially offset by increased capital
development at the new Invincible underground mine (A$25
million/US$19 million).
All-in sustaining costs and total all-in cost increased by 1 per cent
from A$1,198 per ounce (US$916 per ounce) in 2017 to A$1,207
per ounce (US$902 per ounce) in 2018 due to higher cost of sales
before amortisation and depreciation, partially offset by higher
gold sold and lower capital expenditure.
Guidance
The estimate for calendar 2019 is as follows:
· Gold produced ~ 362,000 ounces
· Capital expenditure ~ A$156 million (US$117 million)
· All-in sustaining costs ~ A$1,342 per ounce (US$1,007 per
ounce)
· Total all-in cost ~ A$1,342 per ounce (US$1,007 per ounce)
The increase in all-in sustaining and total all-in costs is due to a
forecast increase of A$59 million (US$44 million) in cost of sales
before amortisation and depreciation, partially offset by a A$14
million (US$10 million) decrease in capital expenditure.
The increased costs is as a result of a forecasted increase in mining
costs of A$29 million (US$22 million) as underground mining
activity is planned to increase from 0.9 million tonnes to 1.3 million
tonnes. In addition, a drawdown of gold-in-process of A$6 million
(US$5 million) is forecast for 2019 as open pit mining activity
decreases. This compared with a A$20 million (US$15 million)
build-up of gold-in-process in 2018.
The decreased capital expenditure is due to a decrease in pre-
strip, partially offset by increased underground capital
development.
Agnew
Year
ended
Dec
2018
Dec
2017
Gold produced
000’oz
239.1
241.2
Gold sold
000’oz
238.5
241.2
Yield
g/t
6.31
6.08
AISC and AIC
A$/oz
1,374
1,276
US$/oz
1,026
977
Gold production decreased by 1 per cent from 241,200 ounces in
2017 to 239,100 ounces in 2018.
Ore mined from underground increased by 4 per cent from 1.17
million tonnes in 2017 to 1.22 million tonnes in 2018. Head grade
17
Gold Fields 2018 RESULTS
mined decreased by 3 per cent from 6.72 grams per tonne to 6.49
grams per tonne due to lower grade from New Holland (3.96 grams
per tonne in 2018 to 4.78 grams per tonne in 2017). Gold mined
decreased marginally from 253,800 ounces to 253,700 ounces. At
Waroonga, ore tonnes mined decreased from 633,500 tonnes in
2017 to 622,400 tonnes in 2018. Grade mined increased from 8.38
grams per tonne to 8.90 grams per tonne and gold mined
increased from 170,700 ounces to 178,100 ounces. At New
Holland, ore tonnes mined increased from 540,700 tonnes in 2017
to 593,400 tonnes in 2018. Grade mined decreased by 17 per cent
from 4.78 grams per tonne to 3.96 grams per tonne and gold mined
decreased from 83,100 ounces to 75,600 ounces.
Tonnes processed decreased by 5 per cent from 1.24 million
tonnes in 2017 to 1.18 million tonnes in 2018 due to a lower
throughput rate in 2018 as a result of downtime to perform major
repairs to the crusher. The combined yield increased by 4 per cent
from 6.08 grams per tonne to 6.31 grams per tonne tonne due to the
processing of higher grade stockpiles in 2018, mined but not
processed in 2017.
Cost of sales before amortisation and depreciation, increased by
10 per cent from A$197 million (US$150 million) in 2017 to A$216
million (US$162 million) in 2018 mainly due to increased mining
cost at Waroonga (A$8 million/US$6 million) as a result of
increased ground support and paste fill and a gold-in-process
charge to costs of A$2 million (US$2 million) in 2018 compared
with a credit to costs of A$6 million (US$5 million) in 2017.
Capital expenditure increased by 2 per cent from A$96 million
(US$74 million) in 2017 to A$98 million (US$73 million) in 2018.
All-in sustaining costs and total all-in cost increased by 8 per cent
from A$1,276 per ounce (US$977 per ounce) in 2017 to A$1,374
per ounce (US$1,026 per ounce) in 2018 due to higher cost of sales
before amortisation and depreciation, higher capital expenditure
and lower gold sold.
Guidance
The estimate for calendar 2019 is as follows:
· Gold produced ~ 221,000 ounces
· Capital expenditure ~ A$98 million (US$74 million)
· All-in sustaining costs ~ A$1,538 per ounce (US$1,154 per
ounce)
· Total all-in cost ~ A$1,538 per ounce (US$1,154 per ounce)
Gold sold is forecast to decrease by 8 per cent due to a 13 per
cent decrease in grade mined from 6.49 grams per tonne to 5.62
grams per tonne, due to reducing grades in the FBH area, partially
offset by a 7 per cent increase in ore tonnes mined. The increased
tonnes mined contributed a A$12 million (US$9 million) increase in
cost of sales before amortisation and depreciation, when added to
the decreased gold sales it results in an additional A$164 per
ounce to all-in sustaining and total all-in costs.
Granny Smith
Year
ended
Dec
2018
Dec
2017
Gold produced
000’oz
280.4
290.3
Gold sold
000’oz
280.5
290.3
Yield
g/t
4.90
5.23
AISC and AIC
A$/oz
1,239
1,171
US$/oz
925
896
Gold production decreased by 3 per cent from 290,300 ounces in
2017 to 280,400 ounces in 2018 due to lower grades mined and
processed.
Ore mined from underground increased by 4 per cent from 1.70
million tonnes to 1.76 million tonnes. Head grade mined
decreased by 5 per cent from 5.50 grams per tonne in 2017 to 5.25
grams per tonne in 2018. Gold mined from underground
decreased by 2 per cent from 300,700 ounces to 296,000 ounces.
Tonnes processed increased by 3 per cent from 1.73 million tonnes
to 1.78 million tonnes. The yield decreased by 6 per cent from 5.23
grams per tonne to 4.90 grams per tonne due to lower grades
mined.
Cost of sales before amortisation and depreciation, increased by
7 per cent from A$210 million (US$160 million) in 2017 to A$225
million (US$168 million) in 2018 mainly due to increased mining
cost (A$15 million/US$12 million) due to the increased ore tonnes
mined from the deeper zones and an 18 per cent increase in ore
development in 2018.
Capital expenditure decreased by 8 per cent from A$114 million
(US$87 million) in 2017 to A$105 million (US$79 million) in 2018
due to the completion of the VR8 ventilation shaft in 2017. The
majority of capital expenditure related to development and
infrastructure at the Wallaby mine, exploration and the
development of a paste plant and associated infrastructure.
All-in sustaining costs and total all-in cost increased by 6 per cent
from A$1,171 per ounce (US$896 per ounce) in 2017 to A$1,239
per ounce (US$925 per ounce) in 2018 mainly due to higher cost
of sales before amortisation and depreciation and lower gold sold,
partially offset by lower capital expenditure.
Guidance
The estimate for calendar 2019 is as follows:
· Gold produced ~ 260,000 ounces
· Capital expenditure ~ A$107 million (US$80 million)
· All-in sustaining costs ~ A$1,370 per ounce (US$1,028 per
ounce)
· Total all-in cost ~ A$1,370 per ounce (US$1,028 per ounce)
The increase in all-in sustaining and total all-in costs is due to a
20,400 ounce decrease in gold sold and a A$10 million (US$7
million) increase in mining costs. The decrease in ounces is due to
a seismic event in the December 2018 quarter which impacted
access to higher grade mining areas in 2019. The lower production
was due to additional barrier pillars now defined in the mine plan
combined with reduced mining rates in parts of the Z100 area as a
consequence of localised geotechnical conditions. Mining costs
increased due to greater haulage distances and the addition of
paste fill as mining depth increases.
Gruyere
First gold remains scheduled for the June 2019 quarter, in line with
the guidance issued in April 2018. The final forecast capital (FFC)
cost estimate remains at A$621 million (level of accuracy range +
2 per cent/-2 per cent) as reported by the joint venture partners on
30 July 2018.
In accordance with the Joint Venture agreement entered into at the
time of the acquisition, Gold Fields will fund up to 10 per cent of
costs overruns, excluding scope changes and force majeure costs.
This translates to approximately A$51 million. Consequently, Gold
Fields share of the FFC is A$337 million with A$246 million having
been incurred up to the end of December 2018. As at end
December 2018, overall project engineering and construction was
97.2 per cent and 88.7 per cent complete, respectively, with EPC
construction (process plant and associated infrastructure) 85.1 per
cent complete.
Gold Fields 2018 RESULTS
18
We believe that the long-life, low-cost nature of Gruyere will
improve the Gold Fields portfolio.
Guidance
The estimate for calendar 2019 is as follows:
· Gold produced ~ 118,000 ounces (100 per cent basis)
· Gold Fields share of production ~ 59,000 ounces
· Sustaining capital expenditure ~ A$13 million (US$9 million)
#
· Growth capital expenditure ~ A$99 million (US$74 million)
#
· All-in sustaining costs ~ A$1,088 per ounce (US$816 per
#
ounce)
· Total all-in cost ~ A$3,178 per ounce (US$2,384 per ounce)
#
#
Gold Fields share only
Corporate
Cash dividend
In line with the Company’s dividend policy, the Board has
approved and declared a final dividend number 89 of 20 SA cents
per ordinary share (gross) in respect of the year ended 31
December 2018. The final dividend will be subject to the Dividend
Withholding Tax of 20 per cent. In accordance with paragraphs
11.17(a) (i) and 11.17(c) of the JSE Listings Requirements, the
following additional information is disclosed:
· The dividend has been declared out of income reserves;
· The gross local dividend amount is 20 SA cents per ordinary
share for shareholders exempt from dividends tax;
· The Dividend Withholding Tax of 20 per cent (twenty per
centum) will be applicable to this dividend;
· The net local dividend amount is 16.000 SA cents per ordinary
share for shareholders liable to pay the dividends tax;
· Gold Fields currently has 821,532,707 ordinary shares in issue;
and
· Gold Fields’ income tax number is 9160035607.
Shareholders are advised of the following dates in respect of the
final dividend:
· Final dividend number 89: 20 SA cents per share
· Last date to trade cum-dividend: Tuesday, 12 March 2019
· Sterling and US dollar conversion date: Wednesday, 13 March
2019
· Shares commence trading ex-dividend: Wednesday, 13 March
2019
· Record date: Friday, 15 March 2019
· Payment of dividend: Monday, 18 March 2019
Share certificates may not be dematerialised or rematerialised
between Wednesday 13 March 2019 and Friday 15 March 2019,
both dates inclusive.
Ghana
The Ghana Chamber of Mines received a letter from the
Government of Ghana dated 31 July 2018 indicating that the
Government intended to exercise its right of pre-emption regarding
minerals “raised, won and obtained in Ghana and from any area
covered by territorial waters, the exclusive economic zone or the
continental shelf and products derived from the refining or
treatment of these minerals” in accordance with section 7 of the
Minerals and Mining Act, 2006 (Act 703). In this regard, the letter
stated that the Government intended to purchase up to 30 per cent
of gold mined in Ghana from all mining companies and requested
the Chamber to inform its members, including Gold Fields, of the
Government’s decision and be prepared to engage with the
Ministry to finalise measures to ensure implementation by 1
November 2018. The Chamber on behalf of its Members has
engaged and will continue to do so to obtain further information on
this decision.
In a meeting on 8 January 2019 with representatives of the
Chamber, the Minister of Lands and Natural Resources indicated
that Government would collaborate with mining companies to
determine ways of adding value to Ghana’s mineral resources in a
mutually beneficial way. The joint committee set up to achieve this
common goal would commence work once the terms of reference
had been finalised. The Chamber representatives pointed out that
letters like the one issued on pre-emptive rights sent the wrong
signals about Ghana and that it was better for Government to work
collaboratively with the industry to adopt the best and most
acceptable way to add value. We are yet to hear from the
Ministry/Government.
Mining charter
On 27 September 2018, the Minister of Mineral Resources,
published the Broad-Based Socio-Economic Empowerment
Charter (2018 Mining Charter). On 19 December 2018, the
Implementation Guidelines were published together with a
Gazetted amendment to the 2018 Mining Charter.
The Minerals Council recognises that 2018 Mining Charter is an
improvement on previous draft versions in 2017 however there are
still certain matters including renewals that require more
engagements with the Minister. We trust that the 2018 Mining
Charter will promote a sustainable mining industry that will be
supported by investment, growth, transformation and value
creation.
Gold Fields continues to support the collaborative and consultative
process of engagement with the Minister, the Department of
Minerals and Resources and other stakeholders through the
Minerals Council.
Outlook for 2019
Attributable equivalent gold production for the Group for 2019 is
expected to be between 2.13 million ounces and 2.18 million
ounces. AISC is expected to be between US$980 per ounce and
US$995 per ounce. AIC is planned to be between US$1,075 per
ounce and US$1,095 per ounce. These expectations assume
exchange rates of R/US$:13.80 and A$/US$:0.75.
Capital expenditure for the Group is planned at US$633 million.
Sustaining capital expenditure for the Group is planned at US$490
million and growth capital expenditure is planned at US$143
million. The US$143 million growth capital expenditure comprises
US$69 million for Damang and A$99 million (US$74 million) as per
above for Gruyere. Expenditure on Salares Norte is expected to
be US$57 million in 2019. The capital expenditure above excludes
the Group’s share of Asanko’s total capital expenditure of US$25
million for 2019.
The above is subject to safety performance which limits the impact
of safety-related stoppages and the forward looking statement on
page 6.
Gold Fields 2018 RESULTS
19
Reviewed preliminary condensed consolidated
financial statements
Notes to the condensed consolidated financial
statements
Basis of preparation
The condensed consolidated financial statements are prepared in
accordance with the requirements of the JSE Limited Listings
Requirements for preliminary reports and the requirements of the
Companies Act of South Africa. The Listings Requirements require
preliminary reports to be prepared in accordance with the
framework concepts and the measurement and recognition
requirements of International Financial Reporting Standards (IFRS)
and the SAICA Financial Reporting Guides as issued by the
Accounting Practices Committee and Financial Pronouncements
as issued by Financial Reporting Standards Council and to also,
as a minimum, contain the information required by IAS 34 Interim
Financial Reporting.
These condensed consolidated financial statements were
authorised by the Board of Directors for issue on 15 February 2019.
The accounting policies applied in the preparation of the
condensed consolidated financial statements are in terms of IFRS
and are consistent with those applied in the previous consolidated
annual financial statements except for the adoption of IFRS 9 Financial
Instruments (IFRS 9) and IFRS 15 Revenue from Contracts with
Customers (IFRS 15).
Auditor’s review
The condensed consolidated financial statements of Gold Fields
Limited for the year ended 31 December 2018 have been reviewed
by the company’s auditor, KPMG Inc.
The auditor’s report does not necessarily report on all of the
information contained in this media release. Shareholders are
therefore advised that in order to obtain a full understanding of the
nature of the auditor’s engagement they should refer to page 43 of
the media release for a copy of the auditor’s report.
Changes in significant accounting policies
The group adopted IFRS 15 and IFRS 9 with effect from 1 January
2018.
IFRS 15
This IFRS introduces a new revenue recognition model for
contracts with customers and establishes a comprehensive
framework for determining whether, how much and when revenue
is recognise
The Group assessed the impact of adopting IFRS 15 and
determined the impact as follows:
·
·
Revenue will be recognised when the customer takes control
of the gold, copper and silver. The timing of recognition of
revenue will no longer be when risks and rewards of ownership
pass to the customer; and
The change in timing of revenue recognition will result in
revenue at the South African and Australian operations being
recognised on settlement date (date when control passes) and
not contract date (previous date when risks and rewards of
ownership passed). There is no change to the revenue
recognition at any of the other operations given that the date
of control is the same date as when risks and rewards of
ownership pass. The change in timing of revenue recognition
for the South African and Australian operations is that revenue
will be recognised approximately two days later than it was
previously recognised.
The Group has adopted IFRS 15 using the cumulative effect
method (without practical expedients), with the effect of initially
applying this standard at the date of initial application (i.e. 1
January 2018). Accordingly, the information presented for prior
periods has not been restated. The impact on opening retained
earnings has been disclosed in the statement of changes in equity
(this had no impact on the non-controlling interest).
There was no material impact on the Group’s income statement
and statements of financial position and cash flows for the year
ended 31 December 2018.
IFRS 9
This IFRS sets out requirements for recognising and measuring
financial assets, financial liabilities and some contracts to buy or
sell non-financial items. This standard replaces IAS 39 Financial
Instruments: Recognition and Measurement.
This IFRS contains a new classification and measurement
approach for financial assets that reflects the business model in
which the assets are managed and their cash flow characteristics.
The three principal classification categories for financial assets are:
amortised cost, fair value through profit or loss (FVTPL) and fair
value through other comprehensive income (FVOCI).
The new classification does not have a significant impact on the
Group accounting for financial assets. The Group’s available-for-
sale financial assets will be designated as FVOCI.
Given the historically low risk of impairment in respect of
receivables and the nature of receivables, the change from the
“incurred loss” model to the “expected credit loss” model did not
have a material impact on the measurement of financial assets.
There was no material impact on the Group’s income statement
and statements of financial position and cash flows for the year
ended 31 December 2018.
Credit facilities successfully refinanced
R1,500 million Nedbank revolving credit facility
On 13 April 2018, Gold Fields Operations Limited and GFI Joint
Venture Holdings (Proprietary) Limited entered into a R1,500
million revolving credit facility with Nedbank Limited which became
available on 8 May 2018. The purpose of this facility was to fund (i)
capital expenditure of the Gold Fields group, and (ii) general
corporate and working capital requirements of the Gold Fields
group. The final maturity date of this facility is five years from the
financial close date, namely 8 May 2023.
US$100 million Senior Secured revolving credit facility
On 12 June 2017, Gold Fields Ghana Limited and Abosso
Goldfields Limited (as Borrowers) entered into a US$100 million
senior secured revolving credit facility with the Standard Bank of
South Africa Limited (acting through its Isle of Man branch) (as
Original Lender and Agent) and Stanbic Ghana Limited (as Security
Agent) which became available on 17 July 2017. The purpose of
this facility was (i) to refinance the outstanding balance of US$45
million under the US$70 million senior secured revolving credit
facility (which matured on 17 July 2017); (ii) to finance working
capital requirements; (iii) for general corporate purposes; and (iv)
for capital expenditure purposes of each borrower. The final
maturity date of this facility is three years from the financial close
date, namely 17 July 2020. On 22 March 2018, the Borrowers, the
Original Lender and the Security Agent entered into an Amendment
and Restatement Agreement to release any and all security
interests created in favour of the Security Agent (the Security). The
effective date of the release of the Security was 22 March 2018.
Gold Fields 2018 RESULTS
20
On 23 November 2018, Gold Fields Ghana Limited and Abosso
Goldfields Limited and The Standard Bank of South Africa Limited
(acting through its Isle of Man branch) entered into the Fifth
Amendment and Restatement Agreement which further amended
the facility agreement. The effective date of the Fifth Amendment
and Restatement Agreement was 30 November 2018. The final
maturity date is the date falling three years after the effective date,
namely 30 November 2021.
US$1,290 million term loan and revolving credit facilities
·
·
US$360 million facility extension (Facility B). On 29 June 2018,
the termination date of 96.18 per cent of the total commitment
under the US$360 million revolving credit facility (i.e.
US$346.25 million) was extended by one year from 6 June
2020 to 6 June 2021.
US$380 million facility extension (Facility A). On 8 November
2018, the termination date of the US$380 million term loan was
extended by one year from 6 June 2019 to 6 June 2020.
Non-recurring items
Asset impairments and write-offs
Asset impairments and write-offs recognised by the Group during
2018 include:
South Deep
·
impairment of R6.471 billion (US$482 million) in respect of the
South Deep cash-generating unit. The after tax impairment
was R4.819 billion (US$359 million). The impairment was
recognised in June 2018, firstly allocated against goodwill and
then against other assets, and given that impairment indicators
still existed at 31 December 2018, a further impairment
assessment was performed.
There were no further impairments at 31 December 2018 using the
following assumptions:
·
·
·
·
·
Gold price of R525,000 per kilogram for 2019 and R550,000
per kilogram thereafter;
Resource price of US$17 per ounce at a Rand/US dollar
exchange rate of R14.63;
Resource ounces of 24.5 million ounces;
Life of mine 75 years; and
Nominal discount rate of 13.5 per cent.
Impairment of investments and assets
The impairment of US$39 million related mainly to the impairment
of FSE which was based on the fair value less cost of disposal of
the investment which was directly derived from the market value
of Lepanto Consolidated Mining Company.
Loss on sale of inventory and assets
The loss on sale of inventory and assets related to the sale of
mining fleet and heavy machinery equipment and inventory at
Tarkwa as part of the transition to contractor mining and amounted
to US$9 million and US$38 million, respectively.
Restructuring costs
The restructuring costs of US$114 million comprised restructuring
costs at Tarkwa of US$89 million with the transition to contractor
mining as well as restructuring costs at Damang and South Deep
of US$14 million and US$11 million, respectively.
Acquisition of a 45 per cent interest in Asanko
On 29 March 2018, the Group entered into certain definitive
agreements (the JV Transaction) with Asanko Gold Inc. (Asanko)
pursuant to which, among other things:
·
·
·
Gold Fields and Asanko will each own a 45 per cent interest in
Asanko Gold Ghana Limited (AGGL), the Asanko subsidiary
that currently owns the Asanko Gold Mine, with the
Government of Ghana continuing to retain a 10 per cent free-
carried interest in AGGL (the Joint Arrangement);
Gold Fields and Asanko will each own a 50 per cent interest in
Adansi Gold Company Ghana Limited (Adansi Ghana), the
Asanko subsidiary that currently owns a number of the
Company’s exploration licenses; and
Gold Fields and Asanko will each acquire a 50 per cent interest
in a newly formed entity (Shika Group Finance Limited (JV
Finco)).
On 20 June 2018, Gold Fields and Asanko received approval of the
JV Transaction from the Ghanaian Minister of Lands and Natural
Resources and the JV Transaction closed on 31 July 2018 once all
conditions precedent were met.
In consideration for its interests in the Joint Arrangement, Gold
Fields:
·
·
contributed US$165.0 million, representing its initial US$164.9
million redeemable share investment in JV Finco, as well as its
initial US$0.1 million equity investments in AGGL, Adansi
Ghana and JV Finco, respectively; and
will contribute an additional US$20.0 million redeemable share
investment to JV Finco based on an agreed Esaase
development milestone, but in any event no later than 31
December 2019.
Recognition and measurement
Gold Fields and Asanko have joint control as each party has 50 per
cent of the voting rights. The Asanko transaction is structured as
a separate vehicle and the Group has a residual interest in the net
assets of Asanko. Accordingly, the Group has classified its interest
in Asanko as a joint venture.
Fair value measured on a provisional basis
The fair value of identifiable net assets acquired has been
performed on a provisional basis, pending completion of review
and sign off of the life of mine model, including the Reserves and
Resources, by the Group Competent Person. Any changes to the
acquisition life of mine model and/or Reserves and Resources
could result in a material change to the cash flows used to
determine the fair value of the identifiable net assets acquired.
If new information is obtained within one year from the date of
acquisition about facts and circumstances that existed at the date
of acquisition and adjustments are required to be made to the
provisional fair values of the identifiable net assets, or if any
additional provisions that existed at the date of acquisition are
identified, then the accounting for the acquisition will be revised.
21
Gold Fields 2018 RESULTS
Consideration transferred
The following table summarises the acquisition date fair value of
the consideration transferred:
2018
US$’m
Cash for Asanko redeemable preference shares and equity
165.0
Total consideration paid
165.0
Gain on acquisition of Asanko
The gain on acquisition was determined as follows:
2018
US$’m
Total fair value of assets acquired
216.8
Consideration transferred
(165.0)
Gain on acquisition
3
51.8
·
The redeemable preference shares have the following conditions:
− Redeemable at the option of the issuer; and
− Non-interest bearing.
The redeemable preference shares were recognised as an investment in an equity
financial instrument measured at fair value. The key assumptions used to determine
the fair value of the redeemable preference shares of US$129.9 million at acquisition
were as follows:
Par value of the preference shares
US$/m
165.0
Market related interest rate
7,85 per cent
Expected redemption period
5 years
·
The key assumptions used to determine the fair value of the net identifiable assets
acquired were as follows:
US$ gold price – 2018 to 2019
US$/oz
1,200
US$ gold price – 2020 onwards
US$/oz
1,300
Discount rate
10.27 per cent
Life of mine
12 years
·
The excess of the fair value of the identifiable net assets acquired over the
consideration is recognised immediately in profit or loss as a gain on acquisition.
Silicosis and tuberculosis class and individual actions
As previously reported, the Gold Working Group (comprising
African Rainbow Minerals, Anglo American SA, AngloGold Ashanti,
Gold Fields, Harmony and Sibanye-Stillwater) (the “GWG Parties”)
concluded a settlement agreement (the “Settlement Agreement”)
with the attorneys representing claimants in the silicosis and
tuberculosis class action litigation on 3 May 2018. The Settlement
Agreement provides meaningful compensation to all eligible
workers suffering from silicosis and/or tuberculosis who worked in
the GWG Parties’ mines from 12 March 1965 to the effective date
of the Settlement Agreement.
The Settlement Agreement is subject to certain suspensive
conditions, including that an unconditional order of court,
sanctioning the Settlement Agreement to make the Settlement
Agreement an order of court, is obtained from the High Court of
South Africa (Gauteng Local Division, Johannesburg) (the “Court”).
The first stage of the Court approval application comprised an ex
parte application which was heard on 13 December 2018.
Following this hearing, the Court issued an order setting out how
members of the settling classes and other interested parties
should be informed of the proposed settlement and how they may
make representations to the Court regarding the settlement,
should they wish.
The second stage of the approval application makes provision for
members of the settling classes and interested parties to make
submissions to the Court, if they so wish, on the settlement. The
hearing of the second stage of the approval application will take
place from 29 to 31 May 2019. Should there be no notifications of
objections to the settlement, this hearing will take place on 3 April
2019.
If and when the Court has approved the settlement, there will then
be a period in which members of the settling classes may indicate
whether they wish to opt out of the settlement. The Settlement
Agreement provides that any member of the settlement classes
who doesn’t opt out is automatically eligible to submit a claim.
In terms of the settlement, a settlement trust will be constituted. A
website (www.SilicosisSettlement.co.za) and a Facebook page
(www.facebook.com/silicosissettlement) were established where
miners, ex-miners or their dependants can register an interest in
making a claim from the settlement trust once it is established, and
learn more about the settlement.
Provision raised
Gold Fields has provided for the estimated cost of the above
settlement based on actuarial assessments and the provisions of
the Settlement Agreement. At 31 December 2018, the provision for
Gold Fields’ share of the settlement of the class action claims and
related costs amounts to US$25 million (R368 million). The nominal
value of this provision is US$35 million (R507 million).
This provision compares to the initial amount raised in June 2017
of US$30 million (R390 million). The decrease is due to a change
in the timing of expected cash flows.
The ultimate outcome of this matter remains uncertain, with a
possible failure to fulfil all the suspensive conditions, including the
Settlement Agreement being approved by the Court. The provision
is consequently subject to adjustment in the future.
South Deep tax dispute
During the September 2014 quarter, the South African Revenue
Service (SARS) issued a Finalisation of Audit Letter stating that
SARS has disallowed GFI Joint Venture Holdings (Pty) Ltd’s
(GFIJVH) additional capital allowance claim.
The Group objected to SARS’ decision and vigorously defended
its position. After no resolution was achieved during a Tax Court
sitting in 2017, GFIJVH appealed to the High Court.
The Group announced that on 30 May 2018 GFIJVH and SARS
entered into a confidential settlement agreement (as provided for
in the Tax Administration Act) in full and final settlement of this
matter. As a result of the settlement GFIJVH has recognised an
additional R2,708 million (US$185 million) of capital allowances
with a tax effect on this amount of R785 million (US$54 million).
Gold Fields 2018 RESULTS
22
Segment reporting
The net (loss)/profit per the income statement reconciles to the net
(loss)/profit in the segmental operating and financial results as
follows:
2018
US$’m
Net loss
(344.8)
– Operating segments
38.7
– Corporate and projects
(383.5)
2017
US$’m
Net loss
(7.7)
– Operating segments
398.5
– Corporate and projects
(406.2)
Additional notes include
·
·
·
Debt maturity ladder on page 25;
Reconciliation of headline earnings with net loss on page 26;
and
Hedging/derivatives on page 27.
N.J. Holland
Chief Executive Officer
15 February 2019
23
Gold Fields 2018 RESULTS
The preliminary financial statements are presented on a condensed consolidated basis
INCOME STATEMENT
United States Dollars
Year
ended
Figures are in millions unless otherwise stated
December
2018
(Reviewed)
December
2017
(Audited)
Revenue
2,577.8
2,761.8
Cost of sales
(2,043.0)
(2,105.1)
Cost of sales before amortisation and depreciation
(1,374.6)
(1,357.0)
– Cost of sales before gold inventory change and amortisation and depreciation
(1,390.8)
(1,426.5)
– Gold inventory change
16.2
69.5
– Amortisation and depreciation
(668.4)
(748.1)
Net interest expense
(66.5)
(62.7)
Share of results of equity accounted investees after taxation
(13.1)
(1.3)
Gain/(loss) on foreign exchange
6.4
(3.5)
Gain on financial instruments
21.0
34.4
Share-based payments
(37.5)
(26.8)
Long-term incentive plan
(1.1)
(5.0)
Other costs, net
(54.9)
(43.7)
Exploration and project expenses
(104.2)
(109.8)
Profit before royalties, taxation and non-recurring items
284.9
438.3
Non-recurring items
(633.1)
(223.9)
(Loss)/profit before royalties and taxation
(348.2)
214.4
Royalties
(62.5)
(62.0)
(Loss)/profit before taxation
(410.7)
152.4
Mining and income taxation
65.9
(173.2)
– Normal taxation
(145.7)
(204.7)
– Deferred taxation
211.6
31.5
Loss from continuing operations
(344.8)
(20.8)
Profit from discontinued operations, net of tax
–
13.1
Loss for the year
(344.8)
(7.7)
Attributable to:
– Owners of the parent
(348.2)
(18.7)
– Non-controlling interest
3.4
11.0
Non-recurring items:
Loss on sale of inventory
(8.9)
–
(Loss)/profit on sale of assets
(51.6)
4.0
Restructuring costs
(113.9)
(9.2)
Silicosis provision adjusted/(raised)
4.5
(30.2)
Impairment of South Deep
(481.5)
(277.8)
Reversal of impairments
–
92.4
Impairment of investments and assets
(38.8)
(14.8)
Gain on acquisition of Asanko
51.8
–
Other
5.3
11.7
Total non-recurring items
(633.1)
(223.9)
Taxation on items above
171.1
(3.7)
Non-recurring deferred taxation items (non-cash)
61.5
6.2
Net non-recurring items after tax
(400.5)
(221.4)
Loss from continuing operations attributable to owners of the parent
(348.2)
(31.8)
Loss per share (cents) from continuing operations attributable to owners of the parent
(42)
(4)
Diluted loss per share (cents) from continuing operations attributable to owners of the parent
(42)
(4)
Profit from discontinued operations attributable to owners of the parent
–
13.1
Profit per share (cents) from discontinued operations attributable to owners of the parent
–
2
Diluted profit per share (cents) from discontinued operations
–
2
Headline earnings from continuing operations attributable to owners of the parent
60.6
212.3
Headline earnings per share (cents) from continuing operations attributable to owners of the parent
7
26
Diluted headline earnings per share (cents) from continuing operations attributable to owners of the parent
7
26
Headline loss from discontinued operations attributable to owners of the parent
–
(2.4)
Diluted headline loss per share (cents) from discontinued operations attributable to owners of the parent
–
–
Profit excluding gains and losses on foreign exchange, financial instruments and non-recurring items after
taxation and non-controlling interest – continuing operations
26.9
157.3
Profit per share excluding gains and losses on foreign exchange, financial instruments and non-recurring
items after taxation and non-controlling interest (cents) – continuing operations
3
19
Loss excluding gains and losses on foreign exchange, financial instruments and non-recurring items after
taxation and non-controlling interest – discontinued operations
–
(3.5)
Loss per share excluding gains and losses on foreign exchange, financial instruments and non-recurring
items after taxation and non-controlling interest (cents) – discontinued operations
–
–
US dollar/South African rand conversion rate
13.20
13.33
US dollar/Australian dollar conversion rate
0.75
0.77
Gold equivalent produced – managed continuing operations
eq oz (000)
2,063
2,193
Gold equivalent produced – managed discontinued operation
eq oz (000)
–
39
Gold equivalent price received
US$/eq oz
1,251
1,255
Figures may not add as they are rounded independently.
The condensed consolidated financial statements have been prepared by the corporate accounting staff of Gold Fields Limited headed by Tzvet Ilarionova, the Group's Financial
Controller. This process was supervised by Paul Schmidt, the Group's Chief Financial Officer.
Gold Fields 2018 RESULTS
24
STATEMENT OF COMPREHENSIVE INCOME
United States Dollars
Year
ended
Figures are in millions unless otherwise stated
December
2018
(Reviewed)
December
2017
(Audited)
Net loss
(344.8)
(7.7)
Other comprehensive income, net of tax
(330.0)
279.2
Equity investments at FVOCI – net change in fair value*
(8.2)
–
Deferred taxation on above item*
4.0
–
Available for sale financial assets - net change in fair value
#
–
(0.7)
Foreign currency translation adjustments
#
(325.8)
279.9
Total comprehensive income
(674.8)
271.5
Attributable to:
– Owners of the parent
(678.2)
260.5
– Non-controlling interest
3.4
11.0
(674.8)
271.5
* Items that will not be reclassified to the income statement.
#
Item can be subsequently reclassified to the income statement.
STATEMENT OF FINANCIAL POSITION
United States Dollars
Figures are in millions unless otherwise stated
December
2018
(Reviewed)
December
2017
(Audited)
Non-current assets
5,183.2
5,505.7
Property, plant and equipment
4,259.2
4,892.9
Goodwill
–
76.6
Other non-current assets
194.1
188.3
Equity accounted investments
225.1
171.3
Investments
235.3
104.6
Deferred taxation
269.5
72.0
Current assets
921.1
1,114.4
– Other current assets
521.4
595.4
– Cash and cash equivalents
399.7
479.0
– Assets held for sale
–
40.0
Total assets
6,104.3
6,620.1
Total equity
2,706.9
3,403.0
Non-current liabilities
2,781.9
2,363.1
Deferred taxation
454.9
453.9
Borrowings
1,925.3
1,587.9
Environmental rehabilitation provisions
289.6
281.5
Finance lease liability
80.1
–
Long-term employee benefits
2.1
–
Other long-term provisions
29.9
39.8
Current liabilities
615.5
854.0
– Other current liabilities
520.7
660.4
– Current portion of borrowings
86.3
193.6
– Current portion of finance lease liability
8.5
–
Total equity and liabilities
6,104.3
6,620.1
US dollar/South African rand conversion rate
14.63
12.58
US dollar/Australian dollar conversion rate
0.70
`
0.77
Net debt (borrowings net of cash and cash equivalents)
1,611.9
1,302.5
25
Gold Fields 2018 RESULTS
STATEMENT OF CHANGES IN EQUITY
United States Dollars
Figures are in millions unless otherwise stated
Share capital
and premium
Other
reserves
Retained
earnings
Non-controlling
interest
Total
equity
Balance at 31 December 2017 (Audited)
3,622.5
(1,817.8)
1,471.1
127.2
3,403.0
Adjustment on initial application of IFRS I5 (net of tax)
–
–
(3.5)
–
(3.5)
Adjusted balance at 1 January 2018
3,622.5
(1,817.8)
1,467.6
127.2
3,399.5
Total comprehensive income
–
(330.0)
(348.2)
3.4
(674.8)
(Loss)/profit for the year
–
–
(348.2)
3.4
(344.8)
Other comprehensive income
–
(330.0)
–
–
(330.0)
Dividends declared
–
–
(45.5)
(9.8)
(55.3)
Share-based payments continuing operations
–
37.5
–
–
37.5
Balance as at 31 December 2018 (Reviewed)
3,622.5
(2,110.3)
1,073.9
120.8
2,706.9
United States Dollars
Figures are in millions unless otherwise stated
Share capital
and premium
Other
reserves
Retained
earnings
Non-controlling
interest
Total
equity
Balance at 31 December 2016 restated (Audited)
3,622.5
(2,124.4)
1,552.6
122.6
3,173.3
Total comprehensive income
–
279.2
(18.7)
11.0
271.5
(Loss)/profit for the year
–
–
(18.7)
11.0
(7.7)
Other comprehensive income
–
279.2
–
–
279.2
Dividends declared
–
–
(62.8)
(6.4)
(69.2)
Share-based payments continuing operations
–
26.8
–
–
26.8
Share-based payments discontinued operation
–
0.6
–
–
0.6
Balance as at 31 December 2017 (Audited)
3,622.5
(1,817.8)
1,471.1
127.2
3,403.0
DEBT MATURITY LADDER (REVIEWED)
United States Dollars
Figures are in millions unless otherwise stated
31 Dec 2018
31 Dec 2019
1 Jan 2020 to
31 Dec 2025
Total
Uncommitted loan facilities
Rand million
1,650.0
–
–
1,650.0
Rand debt translated to dollar
112.8
–
–
112.8
Total (US$’m)
112.8
–
–
112.8
Committed loan facilities
US dollar million
–
–
2,537.0
2,537.0
Rand million
–
–
2,500.0
2,500.0
A$ million
–
–
500.0
500.0
Rand debt translated to dollar
–
–
170.9
170.9
A$ debt translated to dollar
–
–
351.7
351.7
Total (US$’m)
–
–
3,059.6
3,059.6
Total (US$’m) – Uncommitted and committed loan facilities
112.8
–
3,059.6
3,172.4
Utilisation – Uncommitted loan facilities
Rand million
1,263.0
–
–
1,263.0
Rand debt translated to dollar
86.3
–
–
86.3
Total (US$’m)
86.3
–
–
86.3
Utilisation – Committed loan facilities (including US$ bond)
US dollar million
–
–
1,560.9
1,560.9
Rand million
–
–
700.0
700.0
A$ million
–
–
450.0
450.0
Rand debt translated to dollar
–
–
47.9
47.9
A$ debt translated to dollar
–
–
316.5
316.5
Total (US$’m)
–
–
1,925.3
1,925.3
Total (US$’m) – Utilisation – Uncommitted and committed loan facilities
86.3
–
1,925.3
2,011.6
Exchange rate: US$1 = R14.63 and US$1 = A$0.70 being the closing rates for year ended December 2018.
Gold Fields 2018 RESULTS
26
STATEMENT OF CASH FLOWS
United States Dollars
Year
ended
Figures are in millions unless otherwise stated
December
2018
(Reviewed)
December
2017
(Audited)
Cash flows from operating activities
613.1
831.6
Profit before royalties, tax and non-recurring items
284.9
438.3
Non-recurring items
(633.1)
(223.9)
Amortisation and depreciation
668.4
748.1
Other non-cash items
#
611.4
250.2
South Deep BEE dividend
(1.7)
(1.5)
Payment of long-term incentive plan
(17.8)
(11.5)
Change in working capital
(16.3)
(69.4)
Royalties and taxation paid
(282.7)
(305.5)
Cash generated by continuing operations
613.1
824.8
Cash generated by discontinued operations
–
6.8
Dividends paid
(55.3)
(69.2)
Owners of the parent
(45.5)
(62.8)
Non-controlling interest holders
(9.8)
(6.4)
Cash flows from investing activities
(886.8)
(908.6)
Capital expenditure – additions
(814.2)
(833.6)
Proceeds on disposal of property, plant and equipment
78.9
23.2
Purchase of investments
(19.3)
(80.1)
Purchase of Asanko
(165.0)
–
Proceeds on disposal of assets held for sale
40.0
–
Proceeds on disposal of investments
0.5
–
Proceeds on disposal of Darlot
–
5.4
Contributions to environmental trust funds
(7.7)
(16.7)
Cash utilised in continuing operations
(886.8)
(901.8)
Cash utilised in discontinued operations
–
(6.8)
Cash flows from financing activities
257.3
84.2
Loans received
691.7
779.7
Loans repaid
(431.9)
(695.5)
Payment of finance lease liability
(2.5)
–
Cash generated by continuing operations
257.3
84.2
Cash generated by discontinued operations
–
–
Net cash outflow
(71.7)
(62.0)
Net cash outflow from continuing operations
(71.7)
(62.0)
Net cash inflow from discontinued operations
–
–
Translation adjustment
(7.6)
14.3
Cash at beginning of year
479.0
526.7
Cash at end of year
399.7
479.0
Cash flow for continuing operations from operating activities less net capital expenditure,
environmental payments and finance lease payments
(132.4)
(2.3)
#
Includes impairment of South Deep (US$481.5 million), impairment of investments and assets (US$38.8 million), gain on acquisition of Asanko (US$51.8 million) and loss on disposal of
assets (US$51.6 million).
RECONCILIATION OF HEADLINE EARNINGS WITH NET LOSS
United States Dollars
Year
ended
Figures are in millions unless otherwise stated
December
2018
(Reviewed)
December
2017
(Audited)
Net loss from continuing operations
(348.2)
(31.8)
Loss/(profit) on sale of assets
51.6
(4.0)
Taxation effect on sale of assets
(12.0)
1.2
Reversal of impairment
–
(92.4)
Impairment of South Deep
481.5
277.8
Gain on acquisition of Asanko
(51.8)
–
Impairment of investments and assets and other
72.5
66.3
Taxation on impairment of South Deep and investments and assets
(130.4)
(4.3)
Non-controlling interest effect on impairment of investments and assets
(2.6)
(0.5)
Headline earnings from continuing operations
60.6
212.3
Headline earnings per share – cents
7
26
Based on headline earnings as given above divided by 821,532,707 (December 2017 – 820,611,806) being
the weighted average number of ordinary shares in issue.
27
Gold Fields 2018 RESULTS
HEDGING/DERIVATIVES (REVIEWED)
The Group’s policy is to remain unhedged to the gold price. However, hedges are sometimes undertaken as follows:
· to protect cash flows at times of significant expenditure;
· for specific debt servicing requirements; and
· to safeguard the viability of higher cost operations.
Gold Fields may from time to time establish currency financial instruments to protect underlying cash flows.
Derivative instruments*
Ghana – Oil hedge
In May 2017 and June 2017 fixed price ICE Gasoil cash settled swap transactions were entered into for a total of 125.8 million litres of diesel for the period
June 2017 to December 2019. The average swap price is US$457 per metric tonne (equivalent to US$61.4 per barrel). At the time of the transactions, the
average Brent swap equivalent over the tenor was US$49.80 per barrel.
At the reporting date, the mark to market value on the hedge was positive US$3.0 million with a realised gain of US$7.5 million.
Ghana – Gold hedge
In January 2018 and April 2018, a total of 488,900 ounces of the expected production for the Ghanaian region was hedged for the period January 2018 to
December 2018 using zero-cost collars. The average strike prices are US$1,300 per ounce on the floor and US$1,418 per ounce on the cap.
At the reporting date, the mark to market value on the hedge was positive US$2.4 million with a realised gain of US$19.6 million.
Australia – Oil hedge
In May 2017 and June 2017 fixed price Singapore 10ppm Gasoil cash settled swap transactions were entered into, for a total of 77.5 million litres of diesel
for the period June 2017 to December 2019. The average swap price is US$61.15 per barrel. At the time of the transactions, the average Brent swap
equivalent over the tenor was US$49.92 per barrel.
At the reporting date, the mark to market value on the hedge was positive A$2.5 million (US$1.7 million) with a realised gain of A$6.2 million (US$4.6 million).
Australia – Gold hedge
In February 2018, Asian swaps
#
were entered into for the period June 2018 to December 2018 for a total of 221,000 ounces of gold. The average strike price
on the swaps was A$1,714 per ounce.
In March 2018, zero cost collars were entered into for the period April 2018 to December 2018 for a total of 452,800 ounces of gold. The average strike
prices are A$1,703 per ounce on the floor and US$1,767 per ounce on the cap.
The realised gain on the above Asian swaps and zero cost collars was A$11.3 million (US$8.4 million).
In December 2018, additional Asian swaps were entered into for the period January 2019 to December 2019 for a notional 283,000 ounces of gold at an
average strike price of A$1,751 per ounce.
At the reporting date, the mark to market value on the above hedges was negative A$11.9 million (US$8.4 million).
In December 2018, additional zero cost collars were executed for the period January 2019 to December 2019 for a notional 173,000 ounces of gold with a
strike price on the floor at A$1,720 per ounce and the strike price on the cap at A$1,789 per ounce.
At the reporting date, the mark to market value on the hedge was negative A$5.5 million (US$3.9 million).
Subsequent to year end, additional zero cost collars were executed for the period January 2019 to December 2019 for a notional 456,000 ounces of gold
with a strike price on the floor at A$1,800 per ounce and the strike price on the cap at A$1,869 per ounce.
In summary, the zero cost collars taken out for Australia for 2019 are for 629,000 ounces of gold in total with a strike price on the floor at A$1,778
per ounce and a strike price on the cap at A$1,847 per ounce and Asian swaps of 283,000 ounces of gold with an average strike price of A$1,751
per ounce.
Australia – Foreign exchange hedge
In May 2018, AUD/USD average rate forwards were entered into for a total notional US$96 million for the period January 2019 to December 2019 at an
average strike price of 0.7517.
In June 2018, further hedges were taken out for a total notional US$60 million for the same period as above (January 2019 to December 2019) at an average
strike of 0.7330.
In September 2018, further hedges were taken out for a total notional US$100 million for the same period as above (January 2019 to December 2019) at an
average strike of 0.7182.
In October 2018, further hedges were taken out for the period January 2019 to December 2019 for a notional US$60 million at an average strike of 0.7075.
In December 2018, further hedges were taken out for the period January 2019 to December 2019 for a notional US$50 million at an average strike of 0.715.
At the reporting date, the mark to market value on the hedge was negative A$12.3 million (US$8.7 million).
South Africa – Gold hedge
In November 2017, a zero cost collar was entered into for the period January 2018 to December 2018 for 63,996 ounces of gold. The strike prices were
R600,000 per kilogram on the floor and R665,621 per kilogram on the cap.
At the reporting date, the mark to market value on the hedge was positive R5.3 million (US$0.4 million) with a realised gain of R117.2 million (US$8.9 million).
In October 2018 and November 2018, average rate forwards were entered into for the period September 2019 to December 2019 for a total of 69,543
ounces at an average strike price of R615,103 per kilogram.
At the reporting date, the mark to market value was negative R28.6 million (US$2.0 million).
Subsequent to year end, additional rate forwards were taken out for a further 30,072 ounces at an average strike price of R620,000 per kilogram.
In summary, the rate forwards taken out for South Deep for 2019 are for 99,615 ounces of gold in total at an average strike price of R616,581 per
kilogram.
Peru – Copper hedge
In November 2017, zero-cost collars were entered into for the period January 2018 to December 2018. A total volume of 29,400 tonnes was hedged, at an
average floor price of US$6,600 per tonne and an average cap price of US$7,431 per tonne.
At the reporting date the mark to market value on the hedges was positive US$1.2 million, with a realised gain of US$4.8 million.
* Do not qualify for hedge accounting and are accounted for as derivative financial instruments in the income statement.
#
Asian swap is an option where the payoff is determined by the average monthly gold price over the option period.
All these derivative financial instruments are measured at fair value using available market contract values for each trading date’s settlement volume (Level 2).
Gold Fields 2018 RESULTS
28
SEGMENTAL OPERATING AND FINANCIAL RESULTS
United States Dollars
Figures are in millions
unless otherwise stated
Total
Mine
Operations
Including
Equity
Accounted
Joint
Venture
Total
Mine
Operations
Excluding
Equity
Accounted
Joint
Venture
Total
Mine
Continuing
Operations
Excluding
Equity
Accounted
Joint
Venture
South
Africa
Region
West Africa
Region
South
America
Region
Ghana
Peru
South
Deep
Total
Tarkwa
Damang
Asanko*
45%
Cerro
Corona
Operating Results (Unreviewed)
Ore milled/treated
Year 2018
Year 2017
34,110
33,166
33,166
1,320
18,940
13,791
4,205
944
6,644
(000 tonnes)
34,492
34,492
34,154
2,081
18,117
13,527
4,590
–
6,796
Yield
Year 2018
Year 2017
2.0
2.0
2.0
3.7
1.2
1.2
1.3
1.5
1.5
(grams per tonne)
2.0
2.0
2.0
4.2
1.2
1.3
1.0
–
1.4
Gold produced
Year 2018
Year 2017
2,107.8
2,063.2
2,063.2
157.1
750.2
524.9
180.8
44.5
314.1
(000 managed equivalent ounces)
2,232.5
2,232.5
2,193.3
281.3
710.0
566.4
143.6
–
306.7
Gold sold
Year 2018
Year 2017
2,104.5
2,058.6
2,058.6
167.8
751.6
524.9
180.8
45.9
299.1
(000 managed equivalent ounces)
2,240.2
2,240.2
2,201.1
281.8
710.0
566.4
143.6
–
313.8
Gold price received
Year 2018
Year 2017
1,251
1,252
1,252
1,252
1,265
1,271
1,266
1,196
1,174
(dollar per equivalent ounce)
1,255
1,255
1,255
1,256
1,255
1,255
1,255
–
1,252
Cost of sales before gold inventory change
and amortisation and depreciation
Year 2018
Year 2017
42
42
42
199
26
22
34
44
24
(dollar per tonne)
43
43
42
147
26
26
26
–
22
All-in-sustaining costs
Year 2018
Year 2017
971
968
968
1,903
926
951
813
1,069
282
(dollar per ounce)
945
945
936
1,340
958
940
1,027
–
203
Total all-in-cost
Year 2018
Year 2017
1,047
1,044
1,044
2,012
1,098
951
1,506
1,175
282
(dollar per ounce)
1,008
1,008
1,000
1,400
1,119
940
1,827
–
203
Financial Results ($ millions) (Reviewed)
Revenue
Year 2018
Year 2017
#
2,632.7
`
2,577.8
2,577.8
210.1
950.8
666.9
229.0
54.9
351.0
2,810.8
2,810.8
2,761.8
354.1
891.1
710.8
180.3
–
392.9
Cost of sales before
Year 2018
Year 2017
#
(1,412.6)
(1,375.2)
(1,375.2)
(271.7)
(470.6)
(308.8)
(124.4)
(37.4)
(154.8)
amortisation and depreciation
(1,403.8)
(1,403.8)
(1,356.6)
(304.7)
(428.2)
(306.0)
(122.2)
–
(154.3)
Cost of sales before gold inventory
Year 2018
Year 2017
#
(1,433.0)
(1,391.4)
(1,391.4)
(262.0)
(483.8)
(298.7)
(143.5)
(41.6)
(160.3)
change and amortisation and depreciation
(1,472.4)
(1,472.4)
(1,426.1)
(306.3)
(469.4)
(348.0)
(121.2)
–
(151.2)
– Gold inventory change
Year 2018
Year 2017
#
20.4
16.2
16.2
(9.6)
13.2
(10.1)
19.1
4.2
5.5
68.6
68.6
69.5
1.5
41.1
42.0
(0.9)
–
(3.1)
Amortisation of mining assets
Year 2018
Year 2017
#
(680.3)
(664.7)
(664.7)
(48.9)
(283.7)
(168.3)
(99.9)
(15.5)
(81.8)
(748.9)
(748.9)
(745.4)
(74.2)
(242.3)
(220.0)
(22.3)
–
(130.9)
Other expenses
Year 2018
Year 2017
#
(62.9)
(62.6)
(62.6)
(19.5)
1.4
5.7
(3.9)
(0.3)
(8.4)
(91.6)
(91.6)
(89.5)
(7.8)
(16.3)
(9.2)
(7.1)
–
(21.6)
Profit/(loss) before royalties
Year 2018
Year 2017
#
477.0
475.4
475.4
(130.0)
197.9
195.4
0.8
1.7
106.0
and taxation
566.6
566.6
570.3
(32.7)
204.3
175.6
28.7
–
86.2
Royalties, mining and
Year2018
Year 2018
#
(30.5)
(27.8)
(27.8)
161.8
(17.4)
(19.5)
4.8
(2.8)
(61.5)
income taxation
(240.9)
(240.9)
(234.2)
9.1
(82.7)
(80.3)
(2.4)
–
(41.4)
– Normal taxation
Year 2018
Year 2017
#
(161.4)
(161.4)
(161.4)
–
(19.6)
(19.6)
–
–
(52.1)
(209.6)
(209.6)
(207.3)
–
(58.0)
(58.0)
–
–
(50.8)
– Royalties
Year 2018
Year 2017
#
(65.3)
(62.5)
(62.5)
(1.0)
(31.3)
(21.2)
(7.3)
(2.8)
(5.1)
(63.1)
(63.1)
(62.0)
(1.8)
(27.1)
(21.7)
(5.5)
–
(5.3)
– Deferred taxation
Year 2018
Year 2017
#
196.2
196.2
196.2
162.7
33.5
21.4
12.1
–
(4.3)
31.7
31.7
35.0
10.9
2.5
(0.6)
3.1
–
14.7
Profit/(loss) before non-
Year 2018
Year 2017
#
446.4
447.4
447.4
31.7
180.6
175.9
5.6
(1.1)
44.5
recurring items
325.6
325.6
336.0
(23.4)
121.6
95.4
26.3
–
44.9
Non-recurring items
Year 2018
Year 2017
#
(407.8)
(407.8)
(407.8)
(256.5)
(149.7)
(135.8)
(13.9)
–
(2.0)
72.8
72.8
49.3
(1.8)
(15.9)
(10.0)
(5.9)
–
52.6
Net (loss)/profit
Year 2018
Year 2017
#
38.7
39.6
39.6
(224.7)
30.9
40.1
(8.3)
(1.1)
42.6
398.5
398.5
385.4
(25.3)
105.8
85.4
20.4
–
97.4
Year 2018
Year 2017
#
(677.7)
(664.9)
(664.9)
(58.3)
(307.4)
(156.1)
(138.5)
(12.8)
(33.2)
(752.7)
(752.7)
(745.9)
(82.4)
(312.8)
(180.6)
(132.1)
–
(34.0)
The average US dollar/Rand exchange rates were US$1 = R13.20 for 2018 and US$1 = R13.33 for 2017.
The average Australian/US dollar exchange rates were A$1 = US$0.75 for 2018 and A$1 = US$0.77 for 2017.
Figures may not add as they are rounded independently.
#
Reviewed.
* Equity accounted Joint Venture.
29
Gold Fields 2018 RESULTS
SEGMENTAL OPERATING AND FINANCIAL RESULTS
United States Dollars
Australian Dollars
South
African
Rand
United States
Dollars
Australian
Dollars
Figures are in millions
unless otherwise
stated
Australia
Region
Australia
Region
1
South Africa
Region
2
Australia
Region
Australia
Region
Continuing
Continuing
Discontinued
Discontinued
Total
St Ives
Agnew/
Lawlers
Granny
Smith
Total
St Ives
Agnew/
Lawlers
Granny
Smith
South
Deep
Darlot
Darlot
Operating Results (Unreviewed)
Ore milled/treated(000 tonnes)
Year 2018
Year 2017
7,207
4,251
1,178
1,778
7,207
4,251
1,178
1,778
1,348
–
–
7,159
4,198
1,235
1,726
7,159
4,198
1,235
1,726
2,081
338
338
Yield (grams per tonne)
Year 2018
Year 2017
3.8
2.7
6.3
4.9
3.8
2.7
6.3
4.9
3.6
–
–
3.9
2.7
8.8
7.6
3.9
2.7
8.8
7.6
4.2
3.6
3.6
Gold produced (000 managed
Year 2018
Year 2017
886.4
366.9
239.1
280.4
886.4
366.9
239.1
280.4
4,885
–
–
equivalent ounces)
895.4
363.9
241.2
290.3
895.4
363.9
241.2
290.3
8,748
39.2
39.2
Gold sold (000 managed
Year 2018
Year 2017
885.9
367.0
238.5
280.5
885.9
367.0
238.5
280.5
5,220
–
–
equivalent ounces)
895.4
363.9
241.2
290.3
895.4
363.9
241.2
290.3
8,766
39.2
39.2
Gold price received (dollar per
Year 2018
Year 2017
1,265
1,266
1,263
1,266
1,694
1,695
1,690
1,694
531,253
–
–
equivalent ounce)
1,255
1,257
1,254
1,253
1,640
1,642
1,639
1,638
538,344
1,252
1,637
Cost of sales before gold
inventory change and
amortisation and depreciation
Year 2018
Year 2017
73
47
136
94
98
63
182
125
2,564
–
–
(dollar per tonne)
70
45
125
91
91
58
164
119
1,962
137
179
All-in sustaining costs
Year 2018
Year 2017
943
902
1,026
925
1,262
1,207
1,374
1,239
807,688
–
–
(dollar per ounce)
926
916
977
896
1,210
1,198
1,276
1,171
574,406
1,432
1,874
Total all-in-cost
Year 2018
Year 2017
943
902
1,026
925
1,262
1,207
1,374
1,239
854,049
–
–
(dollar per ounce)
926
916
977
896
1,210
1,198
1,276
1,171
600,109
1,432
1,874
Financial Results ($ millions) (Reviewed)
Revenue
Year 2018
Year 2017
#
1,120.8
464.7
301.1
355.0
1,500.5
622.1
403.1
475.3
2,772.9
–
–
1,123.7
457.3
302.6
363.8
1,468.5
597.6
395.4
475.5
4,719.8
49.0
64.1
Cost of sales before amortisation
and depreciation
Year 2018
Year 2017
#
(515.5)
(185.9)
(161.5)
(168.1)
(690.2)
(248.9)
(216.2)
(225.1)
(3,585.8)
–
–
(469.4)
(158.6)
(150.4)
(160.3)
(613.4)
(207.3)
(196.6)
(209.5)
(4,061.9)
(47.1)
(61.7)
Cost of sales before gold
inventory change and
Year 2018
Year 2017
#
(526.9)
(200.9)
(159.7)
(166.3)
(705.4)
(268.9)
(213.9)
(222.6)
(3,458.7)
–
–
amortisation and depreciation
(499.3)
(187.6)
(154.9)
(156.8)
(652.5)
(245.2)
(202.5)
(204.9)
(4,082.5)
(46.3)
(60.5)
– Gold inventory
Year 2018
Year 2017
#
11.4
14.9
(1.7)
(1.8)
15.2
20.0
(2.3)
(2.5)
(127.1)
–
–
change
29.9
29.0
4.5
(3.6)
39.1
37.9
5.9
(4.7)
20.6
(0.9)
(1.1)
Amortisation of mining
Year 2018
Year 2017
#
(265.8)
(355.8)
(646.0)
–
–
assets
(298.1)
(388.2)
(989.2)
(3.5)
(4.2)
Other expenses
Year 2018
Year 2017
#
(36.5)
(48.9)
(257.4)
–
–
(43.8)
(57.2)
(104.2)
(2.1)
(3.0)
Profit/(loss) before
Year 2018
Year 2017
#
303.0
405.7
(1,716.4)
–
–
royalties and taxation
312.4
409.6
(435.5)
(3.7)
(4.7)
Royalties, mining and
Year 2018
Year 2017
#
(113.2)
(151.5)
2,152.5
–
–
income taxation
(119.3)
(156.2)
121.1
(6.7)
(9.0)
– Normal taxation
Year 2018
Year 2017
#
(89.6)
(119.9)
–
–
–
(98.4)
(128.6)
–
(2.3)
(3.0)
– Royalties
Year 2018
Year 2017
#
(27.9)
(37.4)
(13.0)
–
–
(27.8)
(36.3)
(23.6)
(1.1)
(1.5)
– Deferred taxation
Year 2018
Year 2017
#
4.3
5.8
2,165.5
–
–
6.9
8.6
144.8
(3.3)
(4.5)
Profit/(loss) before
Year 2018
Year 2017
#
189.8
254.1
436.2
–
–
non-recurring items
193.1
253.4
(314.2)
(10.4)
(14.7)
Non-recurring items
Year 2018
Year 2017
#
0.3
0.4
(3,445.4)
–
–
14.4
18.7
(23.5)
23.5
30.8
Net profit/(loss)
Year 2018
Year 2017
#
190.2
254.5
(3,009.2)
–
–
207.5
272.1
(337.8)
13.1
17.1
Capital expenditure
Year 2018
Year 2017
#
(278.7)
(127.2)
(72.8)
(78.8)
(373.2)
(170.3)
(97.5)
(105.4)
(769.9)
–
–
(156.2)
(127.2)
(73.7)
(87.0)
(414.1)
(204.1)
(96.2)
(113.8)
(1,098.8)
(6.8)
(8.9)
As a significant portion of the acquisition price was allocated to tenements on endowment ounces and also as the Australian operations are entitled to transfer and then off-set tax
losses from one company to another, it is not meaningful to split the income statement below operating profit.
1
For Australia, all financial numbers are in Australian dollar.
2
For South Africa, all financial numbers are in Rand and Rand per kilogram.
Figures may not add as they are rounded independently.
#
Reviewed.
30
ALL-IN COSTS (UNREVIEWED)
World Gold Council Industry Standard
United States Dollars
Figures are in millions
unless otherwise stated
Total
Group
Including
Equity
Accounted
Joint Venture
Total
Mine
Operations
Excluding
Equity
Accounted
Joint Venture
Total
Mine
Continuing
Operations
Excluding
Equity
Accounted
Joint Venture
South Africa
Region
West Africa
Region
South
America
Region
Ghana
Peru
South
Deep
Total
Tarkwa
Damang
Asanko
Cerro
Corona
Cost of sales before gold
Year 2018
Year 2017
(1,432.4)
(1,391.4)
(1,391.4)
(262.0)
(483.8)
(298.7)
(143.5)
(41.6)
(160.3)
inventory change and
(1,472.8)
(1,472.8)
(1,426.5)
(306.3)
(469.4)
(348.0)
(121.3)
–
(151.2)
amortisation and depreciation
Gold inventory change
Year 2018
Year 2017
20.4
16.2
16.2
(9.6)
13.2
(10.1)
19.1
4.2
5.5
68.6
68.6
69.5
1.5
41.1
42.0
(0.9)
–
(3.1)
Royalties
Year 2018
Year 2017
(65.2)
(62.5)
(62.5)
(1.0)
(31.3)
(21.2)
(7.3)
(2.8)
(5.1)
(63.1)
(63.1)
(62.0)
(1.8)
(27.1)
(21.7)
(5.5)
–
(5.3)
Realised gains/losses on
Year 2018
Year 2017
12.2
12.2
12.2
–
7.6
5.5
2.1
–
–
commodity cost hedges
1.3
1.3
1.3
–
0.8
0.8
–
–
–
Community/social
Year 2018
Year 2017
(14.6)
(14.6)
(14.6)
(1.3)
(7.1)
(6.7)
(0.4)
–
(6.3)
responsibility costs
(20.2)
(20.2)
(20.2)
(2.0)
(11.5)
(11.1)
(0.4)
–
(6.7)
Non-cash remuneration –
Year 2018
Year 2017
(37.5)
(26.9)
(26.9)
(4.7)
(8.8)
(6.7)
(2.1)
–
(4.3)
share-based payments
(27.4)
(19.8)
(26.8)
(3.5)
(6.1) )
(4.8)
(1.3)
–
(3.6)
Cash remuneration
Year 2018
Year 2017
(1.1)
(1.6)
(1.6)
(0.9)
(0.2)
–
(0.2)
–
0.4
(long-term incentive plan)
(5.1)
(4.6)
(5.0)
(0.5)
(1.4)
(1.1)
(0.3)
–
(0.7)
Other
Year 2018
Year 2017
(10.0)
(1.1)
(1.1)
–
(1.0)
–
–
(1.0)
(1.1)
(10.8)
(1.0)
(10.8)
–
–
–
–
–
(1.0)
By-product credits
Year 2018
Year 2017
171.4
171.2
171.2
0.3
1.0
0.7
0.2
0.2
169.2
178.7
178.7
178.6
0.6
(0.8)
(0.9)
0.1
–
177.8
Rehabilitation amortisation
Year 2018
Year 2017
(18.1)
(17.9)
(17.9)
(0.2)
(7.0)
(5.5)
(1.3)
(0.2)
(3.7)
and interest
(23.0)
(23.0)
(22.6)
(0.2)
(7.7)
(7.0)
(0.7)
–
(5.8)
Sustaining capital expenditure
Year 2018
Year 2017
(531.5)
(521.6)
(521.6)
(40.0)
(177.6)
(156.1)
(13.5)
(7.9)
(33.2)
(623.9)
(621.0)
(614.2)
(65.5)
(197.8)
(180.6)
(17.2)
–
(34.0)
Lease payments
Year 2018
Year 2017
(2.3)
(2.3)
(2.3)
–
–
–
–
–
(0.9)
–
–
–
–
–
–
–
–
–
All-in sustaining costs
Year 2018
Year 2017
(1,908.9)
(1,840.3)
(1,840.3)
(319.4)
(695.0)
(498.9)
(147.0)
(49.1)
(39.8)
(1,997.8)
(1,976.5)
(1,938.9)
(377.7)
(679.8)
(532.4)
(147.5)
–
(33.5)
Exploration, feasibility
Year 2018
Year 2017
(78.2)
(0.4)
(0.4)
–
(0.4)
–
(0.4)
–
–
and evaluation costs
(59.9)
–
(59.9)
–
–
–
–
–
–
Non-sustaining capital
Year 2018
Year 2017
(295.3)
(143.3)
(143.3)
(18.3)
(129.9)
(125.0)
–
(4.9)
–
expenditure
(216.5)
(131.8)
(219.3)
(16.9)
(114.9)
–
(114.9)
–
–
Total all-in cost
Year 2018
Year 2017
(2,282.3)
(1,983.9)
(1,983.9)
(337.7)
(825.3)
(498.9)
(272.3)
(54.0)
(39.8)
(2,274.2)
(2,110.3)
(2,218.1)
(394.6)
(794.7)
(532.4)
(262.4)
–
(33.5)
Total all-in sustaining cost
Year 2018
Year 2017
(1,908.9)
(1,840.3)
(1,840.3)
(319.4)
(695.0)
(498.9)
(147.0)
(49.1)
(39.8)
(1,997.8)
(1,976.5)
(1,938.9)
(377.7)
(679.8)
(532.4)
(147.5)
–
(33.5)
Gold only ounces sold
Year 2018
Year 2017
1,946.4
1,900.5
1,900.5
167.8
751.6
524.9
`
180.8
45.9
141.0
– (000 ounces)
2,091.1
2,091.1
2,051.9
281.8
710.0
566.4
143.6
–
164.7
AISC per ounce of gold sold
Year 2018
Year 2017
981
968
968
1,903
926
951
813
1,069
282
US$/oz
955
945
945
1,340
958
940
1,027
–
203
Total all-in cost
Year 2018
Year 2017
(2,282.3)
(1,983.9)
(1,983.9)
(337.7)
(825.3)
(498.9)
(272.3)
(54.0)
(39.8)
(2,274.2)
(2,110.3)
(2,218.1)
(394.6)
(794.7)
(532.4)
(262.4)
–
(33.5)
Gold only ounces sold
– (000 ounces)
Year 2018
Year 2017
1,946.4
1,900.5
1,900.5
167.8
751.6
524.9
180.8
45.9
141.0
2,091.1
2,091.1
2,051.9
281.8
710.0
566.4
143.6
–
164.7
AIC per ounce of gold sold
US$/oz
Year 2018
Year 2017
1,173
1,044
1,044
2,012
1,098
951
1,506
1,175
282
1,088
1,009
1,081
1,400
1,119
940
1,827
–
203
31
Gold Fields 2018 RESULTS
ALL-IN COSTS (UNREVIEWED)
World Gold Council Industry Standard
United States Dollars
Figures are in millions
unless otherwise stated
Total
Continuing
Operations
Australia
Region
Corporate
and
projects
Australia
Region
Continuing
Discontinued
St Ives
Agnew/
Lawlers
Granny
Smith
Darlot
Cost of sales before gold
Year 2018
Year 2017
(526.9)
(200.9)
(159.7)
(166.3)
0.6
–
inventory change and
(499.3)
(187.6)
(154.9)
(156.8)
(0.4)
(46.3)
amortisation and depreciation
Gold inventory change
Year 2018
Year 2017
11.4
14.9
(1.7)
(1.8)
–
–
29.9
29.0
4.5
(3.6)
–
(0.9)
Royalties
Year 2018
Year 2017
(27.9)
(11.6)
(7.4)
(8.8)
–
–
(27.9)
(11.1)
(7.6)
(9.0)
–
(1.1)
Realised gains/losses on
Year 2018
Year 2017
4.6
2.9
0.9
0.8
–
–
commodity cost hedges
0.4
0.3
0.1
0.1
–
–
Community/social
Year 2018
Year 2017
–
–
–
–
–
–
responsibility costs
–
–
–
–
–
–
Non-cash remuneration –
Year 2018
Year 2017
(9.3)
(3.5)
(2.6)
(3.1)
(10.6)
–
share-based payments
(5.9)
(2.2)
(1.7)
(2.1)
(7.7)
(0.6)
Cash remuneration
Year 2018
Year 2017
(0.8)
(0.4)
(0.1)
(0.3)
0.5
–
(long-term incentive plan)
(1.9)
(0.7)
(0.5)
(0.7)
(0.5)
(0.1)
Other
Year 2018
Year 2017
–
–
–
–
(7.9)
–
–
–
–
–
(9.8)
–
By-product credits
Year 2018
Year 2017
0.9
0.5
0.3
0.1
–
–
1.0
0.6
0.3
0.1
–
0.1
Rehabilitation amortisation
Year 2018
Year 2017
(7.2)
(4.4)
(1.5)
(1.3)
–
–
and interest
(8.8)
(5.5)
(2.1)
(1.2)
–
(0.4)
Sustaining capital expenditure
Year 2018
Year 2017
(278.7)
(127.2)
(72.8)
(78.8)
(2.2)
–
(316.9)
(156.2)
(73.7)
(87.0)
(2.8)
(6.8)
Lease payments
Year 2018
Year 2017
(1.4)
(1.4)
–
–
–
–
–
–
–
–
–
–
All-in sustaining costs
Year 2018
Year 2017
(835.3)
(331.0)
(244.7)
(259.6)
(19.6)
–
(829.4)
(333.5)
(235.7)
(260.1)
(21.2)
(56.1)
Exploration, feasibility
Year 2018
Year 2017
–
–
–
–
(77.8)
–
and evaluation costs
–
–
–
–
(59.9)
–
Non-sustaining capital
Year 2018
Year 2017
–
–
–
–
(147.1)
–
expenditure
–
–
–
–
(84.7)
–
Total all-in cost
Year 2018
Year 2017
(835.3)
(331.0)
(244.7)
(259.6)
(244.6)
–
(829.4)
`
(333.5)
(235.7)
(260.1)
(165.8)
(56.1)
Total all-in sustaining cost
Year 2018
Year 2017
(835.3)
(331.0)
(244.7)
(259.6)
(19.6)
–
(829.4)
(333.5)
(235.7)
(260.1)
(21.2)
(56.1)
Gold only ounces sold
Year 2018
Year 2017
885.9
367.0
238.5
280.5
–
–
– (000 ounces)
895.4
363.9
241.2
290.3
–
39.2
AISC per ounce of gold sold
Year 2018
Year 2017
943
902
1,026
925
–
–
US$/oz
926
916
977
896
–
1,432
Total all-in cost
Year 2018
Year 2017
(835.3)
(331.0)
(244.7)
(259.6)
(244.6)
–
(829.4)
(333.5)
(235.7)
(260.1)
(165.8)
(56.1)
Gold only ounces sold
– (000 ounces)
Year 2018
Year 2017
885.9
367.0
238.5
280.5
–
–
895.4
363.9
241.2
290.3
–
39.2
AIC per ounce of gold sold
US$/oz
Year 2018
Year 2017
943
902
1,026
925
–
–
926
916
977
896
–
1,432
Gold Fields 2018 RESULTS
32
ALL-IN SUSTAINING COSTS AND ALL-IN COSTS GROSS OF BY-PRODUCT
CREDITS PER EQUIVALENT OUNCE OF GOLD SOLD (UNREVIEWED)
World Gold Council Industry Standard
United States Dollars
Figures are in millions
unless otherwise stated
Total
Mine
Operations
Including
Equity
Accounted
Joint Venture
Total
Mine
Operations
Excluding
Equity
Accounted
Joint Venture
Total
Mine
Continuing
Operations
Excluding
Equity
Accounted
Joint Venture
South Africa
Region
West Africa
Region
South
America
Region
Ghana
Peru
South
Deep
Total
Tarkwa
Damang
Asanko
Cerro
Corona
All-in sustaining costs
Year 2018
Year 2017
(1,908.9)
(1,840.3)
(1,840.3)
(319.4)
(695.0)
(498.9)
(147.0)
(49.1)
(39.8)
(per table on page 30)
(1,997.8)
(1,997.8)
(1,938.9)
(377.7)
(679.8)
(532.4)
(147.5)
–
(33.5)
Add back by-product credits
Year 2018
Year 2017
(171.4)
(171.2)
(171.2)
(0.3)
(1.0)
(0.7)
(0.2)
(0.2)
(169.2)
(178.7)
(178.7)
(178.6)
(0.6)
0.8
0.9
(0.1)
–
(177.8)
All-in sustaining costs gross
Year 2018
Year 2017
(2,080.3)
(2,011.6)
(2,011.6)
(319.7)
(696.0)
(499.6)
(147.1)
(49.3)
(209.0)
of by-product credits
(2,176.5)
(2,176.5)
(2,117.5)
(378.3)
(679.1)
(531.5)
(147.6)
–
(211.3)
Gold equivalent ounces sold
Year 2018
Year 2017
2,104.5
2,058.6
2,058.6
167.8
751.6
524.9
180.8
45.9
299.1
2,240.2
2,240.2
2,201.1
281.8
710.0
566.4
143.6
–
313.8
AISC gross of by-product
Year 2018
Year 2017
988
977
977
1,905
926
952
812
1,073
699
credits per equivalent ounce
972
972
962
1,342
956
938
1,028
–
673
of gold – US$/eq oz
All-in costs
Year 2018
Year 2017
(2,282.3)
(1,983.9)
(1,983.9)
(337.7)
(825.3)
(498.9) (272.3)
(54.0)
(39.8)
(per table on page 30)
(2,274.2)
(2,274.2)
(2,218.1)
(394.6)
(794.7)
(532.4)
(262.4)
–
(33.5)
Add back by-product credits
Year 2018
Year 2017
(171.4)
(171.2)
(171.2)
(0.3)
(1.0)
(0.7)
(0.2)
(0.2)
(169.2)
(178.7)
(178.7)
(178.6)
(0.6)
0.8
0.9 (0.1)
–
(177.8)
All-in costs gross of
Year 2018
Year 2017
(2,453.7)
(2,155.2)
(2,155.2)
(338.0)
(826.3)
(499.6)
(272.5)
(54.2)
(208.9)
by-product credits
(2,452.9)
(2,452.9)
(2,396.7)
(395.2)
(794.0)
(531.5)
(262.5)
–
(211.3)
Gold equivalent ounces sold
Year 2018
Year 2017
2,104.5
2,058.6
2,058.6
167.8
751.6
524.9
180.8
45.9
299.1
2,240.2
2,240.2
2,201.1
281.8
710.0
566.4
143.6
–
313.8
AIC gross of by-product
Year 2018
Year 2017
1,166
1,047
1,047
2,014
1,099
952
1,506
1,179
699
credits per equivalent ounce
1,095
1,095
1,089
1,402
1,118
938
1,828
–
673
of gold – US$/eq oz
United States Dollars
Figures are in millions
unless otherwise stated
Total
Continuing
Operations
Australia
Region
Corporate
and
projects
Australia
Region
Continuing
Discontinued
St Ives
Agnew/
Lawlers
Granny
Smith
Darlot
All-in sustaining costs
Year 2018
Year 2017
(835.3)
(331.0)
(244.7)
(259.6)
(19.6)
–
(per table on page 31)
(829.4)
(333.5)
(235.7)
(260.1)
(21.2)
(56.1)
Add back by-product credits
Year 2018
Year 2017
(0.9)
(0.5)
(0.3)
(0.1)
–
–
(1.0)
(0.6)
(0.3)
(0.1)
–
(0.1)
All-in sustaining costs gross
Year 2018
Year 2017
(836.1)
(331.5)
(245.0)
(259.7)
(19.6)
–
of by-product credits
(830.4)
(334.1)
(236.0)
(260.3)
(21.2)
(56.2)
Gold equivalent ounces sold
Year 2018
Year 2017
885.9
367.0
238.5
280.5
–
–
895.4
363.9
241.2
290.3
–
39.2
AISC gross of by-product
Year 2018
Year 2017
944
903
1,027
926
–
–
credits per equivalent ounce
927
918
978
897
–
1,435
of gold – US$/eq oz
All-in costs
Year 2018
Year 2017
(835.3)
(331.0)
(244.7)
(259.6)
(244.6)
–
(per table on page 31)
(829.4)
(333.5)
(235.7)
(260.1)
(165.8)
(56.1)
Add back by-product credits
Year 2018
Year 2017
(0.9)
(0.5)
(0.3)
(0.1)
–
–
(1.0)
(0.6)
(0.3)
(0.1)
–
(0.1)
All-in costs gross of
Year 2018
Year 2017
(836.1)
(331.5)
(245.0)
(259.7)
(244.6)
–
by-product credits
(830.4)
(334.1)
(236.0)
(260.3)
(165.8)
(56.2)
Gold equivalent ounces sold
Year 2018
Year 2017
885.9
367.0
238.5
280.5
–
–
895.4
363.9
241.2
290.3
–
39.2
AIC gross of by-product
Year 2018
Year 2017
944
903
1,027
926
–
–
credits per equivalent ounce
927
918
978
897
–
1,435
of gold – US$/eq oz
33
Gold Fields 2018 RESULTS
UNDERGROUND AND SURFACE (UNREVIEWED)
United States Dollars
Imperial
ounces with
metric
tonnes and
grade
Total
Mine
Operations
Including
Equity
Accounted
Joint
Venture
Total
Mine
Operations
Excluding
Equity
Accounted
Joint
Venture
Total
Mine
Continuing
Operations
Excluding
Equity
Accounted
Joint
Venture
South
Africa
Region
West
Africa
Region
South
America
Region
Australia
Region
Ghana
Peru
Continuing
Discontinued
South
Deep
Total
Tarkwa
Damang
Asanko
45%
Cerro
Corona
Total
St Ives
Agnew/
Lawlers
Granny
Smith
Darlot
Tonnes mined (000 tonnes)*
– underground
Year 2018
Year 2017
4,719
4,719
4,719
836
–
–
–
–
–
3,883
911
1,216
1,755
–
ore
5,108
5,108
4,775
1,421
–
–
–
–
–
3,355
484
1,174
1,699
333
– underground
Year 2018
Year 2017
201
201
201
201
–
–
–
–
–
–
–
–
–
–
waste
189
189
189
189
–
–
–
–
–
–
–
–
–
–
– surface ore
Year 2018
Year 2017
30,062
28,921
28,921
–
19,812
14,176
4,495
1,141
6,854
3,396
3,396
–
–
–
31,099
31,099
31,099
–
20,032
16,703
3,329
–
7,085
3,982
3,981
–
–
–
– total
Year 2018
Year 2017
34,981
33,840
33,840
1,036
19,812
14,176
4,495
1,141
6,854
7,279
4,307
1,216
1,755
–
36,396
36,396
36,063
1,610
20,032
16,703
3,329
–
7,085
7,338
4,465
1,174
1,699
333
Grade mined (grams per tonne)
– underground
Year 2018
Year 2017
5.7
5.7
5.7
6.0
–
–
–
–
–
5.4
4.1
6.5
5.2
–
ore
5.8
5.8
6.0
6.1
–
–
–
–
–
5.7
4.1
6.7
5.5
3.7
– surface ore
Year 2018
Year 2017
1.5
1.5
1.5
–
1.3
1.4
1.3
1.5
1.4
2.7
2.7
–
–
–
1.5
1.5
1.5
–
1.3
1.3
1.1
–
1.1
2.9
2.9
–
–
–
– total
Year 2018
Year 2017
2.1
2.1
2.1
4.9
1.3
1.4
1.3
1.5
1.4
4.1
3.0
6.5
5.2
–
2.1
2.1
2.1
5.4
1.3
1.3
1.1
–
1.1
4.2
3.1
6.7
5.5
3.7
Gold mined (000 ounces)*
– underground
Year 2018
Year 2017
831.4
831.4
831.4
162.3
–
–
–
–
–
669.1
119.4
253.7
296.0
–
ore
927.3
927.3
887.6
268.9
–
–
–
–
–
618.7
64.2
253.8
300.7
39.7
– surface ore
Year 2018
Year 2017
1,396.2
1,342.1
1,342.1
1.3
839.1
572.1
242.3
54.0
233.8
292.6
292.6
–
–
–
1,454.2
1,454.2
1,454.2
–
833.7
711.0
122.7
–
246.3
374.3
374.3
–
–
–
– total
Year 2018
Year 2017
2,227.6
2,173.7
2,173.7
163.6
839.1
572.1
242.3
54.0
233.8
961.9
412.0
253.7
296.0
–
2,381.4
2,381.4
2,381.4
268.9
833.7
711.0
122.7
–
246.3
993.0
438.5
253.8
300.7
39.7
Ore milled/treated (000 tonnes)
– total milled
Year 2018
Year 2017
4,654
4,654
4,654
828
–
–
–
–
–
3,731
781
1,178
1,778
–
5,201
5,201
4,863
1,483
–
–
–
–
–
3,380
419
1,235
1,726
338
– underground
Year 2018
Year 2017
210
210
210
210
– ;
– ;
– ;
– ;
–
–
–
–
–
–
waste
165
165
165
165
–
–
–
–
–
–
–
–
–
–
– surface ore
Year 2018
Year 2017
29,335
28,393
28,393
282
18,383
13,791
4,205
944
6,644
3,469
3,469
–
–
–
29,126
29,126
29,126
433
18,117
13,527
4,590
–
6,796
3,779
3,779
–
–
–
– total milled
Year 2018
Year 2017
34,110
33,166
33,166
1,320
18,383
13,791
4,205
944
6,644
7,207
4,251
1,178
1,778
–
34,492
34,492
34,154
2,081
18,117
13,527
4,590
–
6,796
7,159
4,198
1,235
1,726
338
Yield (grams per tonne)
– underground
Year 2018
Year 2017
5.2
5.2
5.2
5.9
–
–
–
–
–
5.1
3.9
6.3
4.9
–
ore
6.1
6.1
6.3
5.9
–
–
–
–
–
7.2
3.9
8.8
7.6
3.6
– surface ore
Year 2018
Year 2017
1.3
1.5
1.5
0.1
1.3
1.2
1.3
1.5
1.5
2.4
2.4
–
–
–
1.5
1.5
1.5
0.1
1.2
1.3
1.0
–
1.4
2.7
2.5
–
–
–
– combined
Year 2018
Year 2017
2.0
2.0
2.0
3.7
1.3
1.2
1.3
1.5
1.5
3.8
2.7
6.3
4.9
–
2.0
2.0
2.0
4.2
1.2
1.3
1.0
–
1.4
3.9
2.7
8.8
7.6
3.6
Gold produced (000 ounces)
– underground
Year 2018
Year 2017
772.1
604.8
604.8
155.8
–
–
–
–
–
449.0
96.7
239.1
280.5
–
ore
760.9
760.9
721.8
280.0
–
–
–
–
–
441.8
49.1
241.2
290.3
39.2
– surface ore
Year 2018
Year 2017
1,335.8
1,291.3
1,291.3
1.3
749.9
524.9
180.8
44.5
314.1
270.2
270.2
–
–
–
1,471.6
1,471.6
1,471
1.2
710.0
566.4
143.6
–
306.7
453.6
314.8
–
–
–
– total
Year 2018
Year 2017
2,107.8
2,063.3
2,063.3
157.1
749.9
524.9
180.8
44.5
314.1
886.4
366.9
239.1
280.5
–
2,232.5
2,232.5
2,193
281.3
710.0
566.4
143.6
–
306.7
895.4
363.9
241.2
290.3
39.2
Cost of sales before gold inventory
change and amortisation and depreciation
(dollar per tonne)
– underground
Year 2018
Year 2017
147
147
147
271
–
–
–
–
–
104
80
136
94
–
129
129
132
185
–
–
–
–
–
100
64
125
91
137
– surface
Year 2018
Year 2017
26
25
25
1
26
22
34
44
24
40
40
–
; –
–
27
27
27
2
26
26 ;
26
–
22
43
43
–
–
–
– total
Year 2018
Year 2017
42
42
42
199
26
22
34
44
24
73
47
136
94
–
43
43
42
147
26
26
26
–
22
70
45
125
91
137
Gold Fields 2018 RESULTS
34
Review of Operations (Unreviewed)
Quarter ended 31 December 2018
compared with quarter ended
30 September 2018
South Africa region
South Deep Project
Dec
2018
Sept
2018
Gold produced
000’oz
11.0
49.5
kg
343
1,539
Gold sold
000’oz
16.3
47.3
kg
508
1,472
Yield – underground reef
g/t
5.30
5.63
AISC
R/kg
1,834,112
758,304
US$/oz
3,906
1,663
AIC
R/kg
1,881,395
804,998
US$/oz
3,986
1,764
Regrettably, a tragic accident occurred on 12 October 2018 fatally
injuring Mr. Ananias Mosololi. The mine was issued with a Section
54 instruction, halting mobile machinery and secondly to conduct
an investigation. A partial upliftment was issued on 18 October
2018 with a full upliftment on 31 October 2018. 18 days of
production was either lost or significantly impacted.
South Deep embarked on a restructuring process as reported in
the September quarter. The prescribed consultation process was
concluded on 28 October 2018 culminating in the retrenchment of
1,092 permanent employee’s and 420 contractors. The majority
union, the NUM, obtained a certificate of non-resolution from the
CCMA and issued a notice of intended industrial action on 31
October 2018. The protected industrial action commenced on 2
November 2018 and lasted 6 weeks. Employees participating in
the industrial action blocked all roads to the mine, limiting access
and the ability to continue with any mining operations. Production
was therefore suspended and essential services continued
intermittently when access was possible. Negotiations with all
levels of the union (branch, regional and national) concluded on 18
December 2018 with the signing of a new agreement that ended
the industrial action. The mine resumed operations gradually from
15 December 2018. The process had a profound impact on
production with the operations suspended for 41 days with a
preceding “go slow” and acts of sabotage. It took an additional 8
days to start-up the underground sections post 15 December
2018.
Gold production subsequently decreased by 78 per cent from
1,539 kilograms (49,489 ounces) in the September quarter to 343
kilograms (11,019 ounces) in the December quarter.
Total underground tonnes mined decreased by 75 per cent from
319,000 tonnes in the September quarter to 79,000 tonnes in the
December quarter. Ore tonnes mined decreased by 78 per cent
from 277,000 tonnes to 62,000 tonnes, while underground waste
mined decreased by 60 per cent from 42,000 tonnes to 17,000
tonnes. Access development in the reef areas decreased by 76
per cent from 48,800 tonnes to 11,800 tonnes. It was constrained
by continued ground support and rehabilitation requirements.
Underground reef grade mined decreased by 24 per cent from
6.14 grams per tonne to 4.67 grams per tonne due to a decrease
in stoping grade from 7.11 grams per tonne in the September
quarter to 4.78 grams per tonne in the December quarter as a
result of loading the remainder of the broken stoping volume from
the suspended lower grade 87 1W area. Total gold mined from
underground decreased by 84 per cent from 1,697 kilograms
(54,600 ounces) in the September quarter to 280 kilograms (9,000
ounces) in the December quarter, in line with volumes and grade.
Total tonnes milled decreased by 59 per cent from 387,000 tonnes
in the September quarter to 159,000 tonnes in the December
quarter. Reef yield decreased 6 per cent from 5.63 grams per
tonne to 5.30 grams per tonne in line with the lower reef grade.
Surface tailings material treated decreased by 4 per cent from
73,000 tonnes to 70,000 tonnes.
Gold recovered from underground amounted to 333 kilograms
(10,700 ounces) and included 53 kilograms (1,700 ounces)
released from gold-in-process. In addition, 10 kilograms (320
ounces) were recovered from the treatment of surface material.
Destress mining decreased by 70 per cent from 4,356 square
metres in the September quarter to 1,323 square metres in the
December quarter partly due to a new destress support design
implemented in October 2018. In addition to the normal tendon
and mesh support the design includes for shotcrete to be applied
on the side walls over the mesh. This design will improve support
effectiveness, excavation durability, reduce support rehabilitation
cycles and reduce rock burst risk. Implementing the new design
and catching up with the backlog of ground support in previously
mined excavations, impacted destress progress negatively.
However, the benefits of the new support protocols are expected
to be significant.
Longhole stoping decreased by 84 per cent from 188,300 tonnes
to 29,700 tonnes. Development decreased by 62 per cent from
1,190 metres in the September quarter to 452 metres in the
December quarter. Development in the current mine areas
decreased by 58 per cent from 518 metres in the September
quarter to 217 metres in the December quarter. Development
North of Wrench decreased by 54 per cent from 512 metres in the
September quarter to 235 metres in the December quarter. New
mine capital development on 100 level was suspended from the
end of July 2018 as this activity was ahead of schedule and crews
were re-allocated. New mine development amounted to 160
meters in the September quarter and to nil meters in the December
quarter.
The current mine contributed 69 per cent of the total ore tonnes in
the December quarter compared with 53 per cent in the
September quarter with the balance from North of Wrench. The
decrease in the North of Wrench contribution was mainly due to
lower destress performance as discussed above. The tonnage
contribution from longhole stoping decreased by 14 per cent from
59 per cent in the September quarter to 45 per cent in the
December quarter due to lower stope availability.
Cost of sales before amortisation and depreciation decreased by
19 per cent from R941 million (US$66 million) to R763 million
(US$52 million). Cost of sales before gold inventory change and
amortisation and depreciation decreased from R975 million
(US$69 million) in the September quarter to R638 million (US$43
million) in the December quarter mainly due to lower salaries and
wages, contractors and consumable costs in the December
quarter due to the industrial action. This was partially offset by a
gold-in-process charge to cost of R125 million (US$9 million) in
the December quarter compared with a credit to cost of R34
million (US$3 million) due to the drawdown of stockpiles in the
December quarter.
35
Gold Fields 2018 RESULTS
Capital expenditure decreased by 17 per cent from R214 million
(US$15 million) in the September quarter to R177 million (US$12
million) in the December quarter.
Sustaining capital expenditure increased by 5 per cent from R146
million (US$10 million) in the September quarter to R153 million
(US$11 million) in the December quarter due to an increase in
major component and rebuild costs for the mine’s fleet. Non-
sustaining capital expenditure decreased by 65 per cent from R69
million (US$5 million) to R24 million (US$1 million) due to the
suspension of the new mine development.
All-in sustaining costs increased by 142 per cent from R758,304
per kilogram (US$1,663 per ounce) in the September quarter to
R1,834,112 per kilogram (US$3,906 per ounce) in the December
quarter mainly due to lower gold sold and higher sustaining capital
expenditure, partially offset by lower cost of sales before
amortisation and depreciation.
Total all-in cost increased by 134 per cent from R804,998 per
kilogram (US$1,764 per ounce) in the September quarter to
R1,881,395 per kilogram (US$3,986 per ounce) in the December
quarter due to the same reasons as for all-in sustaining costs,
partially offset by lower non-sustaining capital expenditure.
West Africa region
Ghana
Tarkwa
Dec
2018
Sept
2018
Gold produced
000’oz
134.0
126.5
Gold sold
000’oz
134.0
126.5
Yield g/t
1.21
1.14
AISC and AIC
US$/oz
924
972
Gold production increased by 6 per cent from 126,500 ounces in
the September quarter to 134,000 ounces in the December quarter
mainly due to higher yield.
Total tonnes mined, including capital waste stripping, increased
by 2 per cent from 22.0 million tonnes in the September quarter to
22.5 million tonnes in the December quarter. Ore tonnes mined
increased by 14 per cent from 3.5 million tonnes to 4.0 million
tonnes due to increased mining volumes at Pepe and Akontansi
pits in line with the mining plan.
Operational waste tonnes mined increased by 12 per cent from 6.7
million tonnes to 7.5 million tonnes due to accelerated mining at
Akontansi and Pepe pits to expose ore. Capital waste tonnes
mined decreased by 7 per cent from 11.8 million tonnes to 11.0
million tonnes. Mined grade increased by 2 per cent from 1.21
grams per tonne to 1.23 grams per tonne. Gold mined increased
by 15 per cent from 136,400 ounces to 157,200 ounces as a result
of increased ore tonnes mined. The strip ratio decreased from 5.3
to 4.7.
The CIL plant throughput was similar at 3.5 million tonnes Yield
increased by 6 per cent from 1.14 grams per tonne to 1.21 grams
per tonne mainly due to higher grade ore mined and processed.
Cost of sales before amortisation and depreciation, increased by
9 per cent from US$76 million to US$83 million mainly due to
increased operational tonnes mined, partially offset by a gold-in-
process credit to costs of US$4 million in the December quarter
compared with a charge to costs of US$3 million in the September
quarter.
Capital expenditure decreased by 11 per cent from US$38 million
to US$34 million due to lower capital stripping.
All-in sustaining costs and total all-in cost decreased by 5 per cent
from US$972 per ounce in the September quarter to US$924 per
ounce in the December quarter due to higher gold sold and lower
capital expenditure, partially offset by increased cost of sales
before amortisation and depreciation.
Damang
Dec
2018
Sept
2018
Gold produced
000’oz
40.0
51.3
Gold sold
000’oz
40.0
51.3
Yield
g/t
1.28
1.55
AISC
US$/oz
937
682
AIC US$/oz
1,601
1,288
Gold production decreased by 22 per cent from 51,300 ounces in
the September quarter to 40,000 ounces in the December quarter
mainly due to lower head grade and tonnes processed as a
consequence of a planned 16 day plant shutdown to replace the
SAG mill shell.
Total tonnes mined, including capital stripping, decreased by 7 per
cent from 11.4 million tonnes in the September quarter to 10.6
million tonnes in the December quarter mainly due to space
constraints at the Amoanda pit given its level of maturity, which
was factored in to the operational plan.
Ore tonnes mined increased by 8 per cent from 1.32 million tonnes
in the September quarter to 1.43 million tonnes in the December
quarter mainly from Amoanda pit area where the ore zones are
exposed. Total waste tonnes mined decreased by 9 per cent from
10.1 million tonnes to 9.2 million tonnes in line with the operational
plan. Capital waste tonnes included in total waste tonnes
decreased by 16 per cent from 8.1 million tonnes to 6.8 million
tonnes due to lower stripping volumes from the Amoanda and
Saddle pits which are at the later stages of the current cutback.
Operational waste tonnes mined increased by 20 per cent from 2.0
million tonnes to 2.4 million tonnes also in line with the operational
plan. In the December quarter total tonnes mined at Amoanda pit
were 2.4 million tonnes and at DPCB were 8.2 million tonnes.
Head grade mined decreased by 13 per cent from 1.72 grams per
tonne to 1.50 grams per tonne due to lower grade mined at the
south of Amoanda pit. Gold mined decreased by 5 per cent from
72,700 ounces to 68,800 ounces. The strip ratio decreased from
7.7 to 6.4 due to exposed ore surfaces mined at the Amoanda pit.
Tonnes processed decreased by 10 per cent from 1.08 million
tonnes in the September quarter to 0.97 million tonnes in the
December quarter due to lower plant overall equipment availability
as a result of a planned shutdown to replace the SAG mill shell.
Yield decreased by 17 per cent from 1.55 grams per tonne to 1.28
grams per tonne due to lower feed grade mined as a consequence
of an increase in stockpiled tonnes processed. The SAG mill shell
replacement was completed ahead of schedule during December,
by which time the target of 2018 has been achieved. The strategic
decision was taken to feed additional tonnes from low grade
stockpile in order not to jeopardise the 2019 plan, which required
a high-grade stockpile as per the 2019 plan. In the December
quarter, tonnes milled were sourced as follows: 0.84 million tonnes
at 1.44 grams per tonne from the pits and 0.13 million tonnes at
1.03 grams per tonne from stockpiles. This compared with 1.02
million tonnes at 1.75 grams per tonne from the pits and 0.06
Gold Fields 2018 RESULTS
36
million tonnes at 1.07 grams per tonne from stockpiles in the
September quarter.
Cost of sales before amortisation and depreciation, increased by
14 per cent from US$29 million to US$33 million mainly due to
higher operating tonnes mined.
Capital expenditure decreased by 11 per cent from US$35 million
in the September quarter to US$31 million in the December
quarter as a result of lower capital waste tonnes mined.
Sustaining capital expenditure decreased by 25 per cent from
US$4 million to US$3 million. Non-sustaining capital expenditure
decreased by 10 per cent from US$31 million to US$28 million
mainly due to lower capital waste mined (6.8 million tonnes in the
December quarter compared with 8.1 million tonnes mined in the
September quarter).
All-in sustaining costs increased by 37 per cent from US$682 per
ounce in the September quarter to US$937 per ounce in the
December quarter mainly due to lower gold sold and higher cost
of sales before amortisation and depreciation, partially offset by
lower sustaining capital expenditure.
All-in costs increased by 24 per cent from US$1,288 per ounce in
the September quarter to US$1,601 per ounce in the December
quarter due to the same reasons above, partially offset by lower
non-sustaining capital expenditure.
At the end of the December 2018 quarter, and 24 months into the
Damang Reinvestment Project (DRP), total material mined
amounted to 86 million tonnes, 23 per cent ahead of the project
schedule. Gold produced during the same period was 324,300
ounces, 38 per cent above the DRP ounces of 235,574. The new
SAG mill shell has been installed successfully. The project capital
spent to date is US$271 million versus the original DRP budget of
US$228 million.
Asanko (Equity accounted Joint Venture)
Dec
2018
Sept
2018
3 months
ended
2 months
ended
Gold produced
000’oz
59.8
39.1
Gold sold
000’oz
61.8
40.3
Yield
g/t
1.46
1.54
AISC
US$/oz
1,105
1,018
AIC
US$/oz
1,266
1,039
Gold production of 59,800 ounces for the three months ended
December 2018 compared with 39,100 ounces for the two months
ended September 2018.
Total tonnes mined of 9.7 million tonnes for the three months
ended December 2018 compared with 7.1 million tonnes for the
two months ended September 2018. Ore tonnes mined of 1.4
million tonnes for the three months ended December 2018
compared with 1.2 million tonnes for the two months ended
September 2018. Head grade mined of 1.51 grams per tonne for
the three months ended December 2018 compared with 1.64
grams per tonne for the two months ended September 2018.
Total waste tonnes mined of 8.4 million tonnes for the three
months ended December 2018 compared with 6.0 million tonnes
for the two months ended September 2018. The strip ratio of 6.1
for the three months ended December 2018 compared with 5.1 for
the two months ended September 2018.
The plant throughput of 1.2 million tonnes for the three months
ended December 2018 compared with 0.9 million tonnes for the
two months ended September 2018. Yield of 1.46 grams per
tonne for the three months ended December 2018 compared with
1.54 grams per tonne for two months ended September 2018.
Cost of sales before amortisation and depreciation of US$53
million for the three months ended December 2018 compared with
US$30 million for the two months ended September 2018 in line
with the increase in production.
Sustaining capital expenditure for the three months ended
December 2018 was US$10 million and non-sustaining capital
expenditure was US$10 million mainly due to expenditure on the
haul road and other expenditure related to the Esaase project.
This compared with US$8 million and US$1 million for the two
months ended September 2018 for sustaining and non-sustaining
capital expenditure, respectively.
Gold Fields’ 45 per cent share of gold produced and gold sold
amounted to 26,900 ounces and 27,800 ounces for the three
months ended December 2018, respectively and 17,600 ounces
and 18,100 ounces, respectively, for the two months ended
September 2018. Gold Fields share of cost of sales before
amortisation and depreciation was US$24 million for the three
months ended December 2018 and US$14 million for the two
months ended September 2018. Gold Fields share in sustaining
capital expenditure for the three months ended December 2018
was US$5 million and US$4 million for the two months ended
September 2018. Our share in non-sustaining capital expenditure
for the three months ended December 2018 was US$5 million and
US$nil for the two months ended September 2018.
South America region
Cerro Corona
Dec
2018
Sept
2018
Gold produced
000’oz
48.4
40.7
Copper produced
tonnes
8,849
8,437
Total equivalent gold produced
000’eq oz
93.2
83.2
Total equivalent gold sold
000’eq oz
87.4
80.0
Yield
– gold
g/t
0.98
0.77
– copper
per cent
0.58
0.51
– combined
eq g/t
1.81
1.51
AISC and AIC
US$/oz
252
443
AISC and AIC
US$/eq oz
649
691
Gold price*
US$/oz
1,223
1,218
Copper price*
US$/t
6,189
6,139
*
Average daily spot price for the period used to calculate total equivalent gold ounces
produced.
All-in sustaining costs and total all-in for the three months ended
December 2018 of US$1,105 per ounce and US$1,266 per ounce
compared with US$1,018 per ounce and US$1,039 per ounce for
the two months ended September 2018, respectively.
Gold production increased by 19 per cent from 40,700 ounces in
the September quarter to 48,400 ounces in the December quarter
due to higher grades mined and processed. Copper production
increased by 5 per cent from 8,437 tonnes to 8,849 tonnes due to
higher grade mined and processed. Equivalent gold production
increased by 12 per cent from 83,200 ounces to 93,200 ounces
mainly due to higher grade processed in line with the mining
sequence.
37
Gold Fields 2018 RESULTS
Gold head grade increased by 18 per cent from 1.14 grams per
tonne to 1.35 grams per tonne and gold recoveries increased from
66.1 per cent to 68.3 per cent, in line with the mining sequence.
Copper head grade increased by 3 per cent from 0.58 per cent to
0.60 per cent and copper recoveries increased from 86.2 per cent
to 90.3 per cent. Gold yield increased by 27 per cent from 0.77
grams per tonne to 0.98 grams per tonne due to higher head grade
and recovery. Copper yield increased by 14 per cent from 0.51
per cent to 0.58 per cent due to higher head grade and recovery.
In the December quarter, concentrate with a payable content of
45,494 ounces of gold was sold at an average price of US$1,227
per ounce and 8,369 tonnes of copper was sold at an average
price of US$5,426 per tonne, net of treatment and refining
charges. This compared with 38,980 ounces of gold that was sold
at an average price of US$1,206 per ounce and 8,191 tonnes of
copper that was sold at an average price of US$5,335 per tonne,
net of treatment and refining charges, in the September quarter.
Total tonnes mined decreased by 3 per cent from 5.44 million
tonnes in the September quarter to 5.25 million tonnes in the
December quarter mainly due to lower waste mined in line with the
mining sequence. Ore mined increased by 5 per cent from 1.74
million tonnes to 1.82 million tonnes. Operational waste tonnes
mined decreased by 7 per cent from 3.70 million tonnes to 3.43
million tonnes in line with the mining plan. The strip ratio
decreased from 2.12 to 1.89.
Ore processed decreased by 6 per cent from 1.71 million tonnes
to 1.60 million tonnes due to lower plant utilisation as a result of
the planned plant shutdown in the December quarter.
Cost of sales before amortisation and depreciation, decreased by
3 per cent from US$39 million to US$38 million mainly due to a
US$5 million gold-in-process credit to cost in the December
quarter compared with US$1 million in the September quarter as
a result of an increase in stockpiles.
Capital expenditure increased by 18 per cent from US$11 million
to US$13 million due to an increase in construction activities at the
tailings dam and reallocation of infrastructure related to expansion
to 2030.
All-in sustaining costs and total all-in cost per gold ounce
decreased by 43 per cent from US$443 per ounce in the
September quarter to US$252 per ounce in the December quarter
mainly due to higher by-product credits and increased gold sold,
partially offset by increased capital expenditure. All-in sustaining
costs and total all-in cost per equivalent ounce decreased by 6 per
cent from US$691 per equivalent ounce to US$649 per equivalent
ounce due to the same reasons as above, as well as higher gold
equivalent ounces sold.
Australia region
St Ives
Dec
2018
Sept
2018
Gold produced
000’oz
87.9
89.2
Gold sold
000’oz
87.9
88.9
Yield
– underground
g/t
3.63
3.74
– surface
g/t
2.13
2.31
– combined
g/t
2.53
2.58
AISC and AIC
A$/oz
1,533
1,355
US$/oz
1,109
993
Gold production, decreased by 1 per cent from 89,200 ounces in
the September quarter to 87,900 ounces in the December quarter.
Total ore tonnes mined decreased by 25 per cent from 0.8 tonnes
in the September quarter to 0.6 million tonnes in the December
quarter.
Total underground ore tonnes mined increased by 17 per cent
from 275,300 tonnes in the September quarter to 323,200 tonnes
in the December quarter.
At the Hamlet underground operation, ore tonnes mined
decreased by 11 per cent from 83,300 tonnes in the September
quarter to 73,800 tonnes in the December quarter. Head grade
increased by 10 per cent from 3.41 grams per tonne to 3.76 grams
per tonne with higher grade stopes mined during the December
quarter as per the mining schedule. Gold mined from Hamlet
underground decreased by 2 per cent from 9,100 ounces to 8,900
ounces.
Operations at the Invincible underground mine continued to grow.
Ore tonnes mined increased by 30 per cent from 192,000 tonnes
in the September quarter to 249,400 tonnes in the December
quarter. Head grade mined decreased by 10 per cent from 4.16
grams per tonne to 3.76 grams per tonne due to development
carried out in December quarter in lower grade areas of the mine,
resulting in a decrease in grades from development ore. Gold
mined from Invincible underground increased by 17 per cent from
25,700 ounces to 30,100 ounces.
Total tonnes mined at the open pits, decreased by 30 per cent
from 4.7 million tonnes in the September quarter to 3.3 million
tonnes in the December quarter.
At the open pit operations, ore tonnes mined decreased by 50 per
cent from 0.6 million tonnes in the September quarter to 0.3 million
tonnes in the December quarter with Neptune open pit the only
source of ore, following the completion of mining activities at the
Invincible open pit stage 5 in the September quarter.
Grade mined from open pits, decreased by 40 per cent from 2.35
grams per tonne to 1.40 grams per tonne reflecting the lower
grade ore mined from Neptune and no high grade ore delivered from
Invinsible following the completion of stage 5. Gold mined
from the open pits decreased by 69 per cent from 41,600 ounces
to 13,100 ounces. In the December quarter, tonnes mined were
sourced as follows: 0.3 million tonnes at 1.40 grams per tonne
from Neptune and nil from Invincible. This compared with 0.3
million tonnes at 3.28 grams per tonne from Invincible and 0.3
million tonnes at 1.15 grams per tonne from Neptune in the
September quarter.
Operational waste tonnes mined decreased by 55 per cent from
1.1 million tonnes in the September quarter to 0.5 million tonnes
in the December quarter and capital waste tonnes mined
Gold Fields 2018 RESULTS
38
decreased by 17 per cent from 3.0 million tonnes to 2.5 million
tonnes. The decrease in waste tonnes mined was due to the
completion of Invincible stage 5 with the mining fleet utilised at
Neptune open pit and also performing rehabilitation works at
historic waste rock dumps. Total material movements at the open
pits decreased by 30 per cent from 4.7 million tonnes to 3.3 million
tonnes. The strip ratio increased from 7.4 to 10.6 driven by pre-
strip activity at Neptune.
Ounces mined at the total St Ives complex decreased by 32 per
cent from 76,500 ounces in the September quarter to 52,200
ounces in the December quarter due to a 50 per cent reduction in
ore tonnes mined at the open pits with the completion of mining
activities at Invincible open pit stage 5. At the end of the
December quarter, stockpiled Neptune high-grade oxide material
amounted to 47,700 ounces (763,100 tonnes at 1.94 grams per
tonne), Invincible amounted to 100 ounces (2,000 tonnes at 1.94
grams per tonne) and A5 amounted to 7,900 ounces (174,000
tonnes at 1.41 grams per tonne). This compared with Neptune
high-grade oxide material which amounted to 65,300 ounces
(997,700 tonnes at 1.57 grams per tonne), Invincible amounted to
32,200 ounces (227,200 tonnes at 2.55 grams per tonne) and A5
amounted to 7,900 ounces (174,000 tonnes at 1.46 grams per
tonne), at the end of the September quarter. Currently, Lefroy mill
can only sustain a 25 per cent oxide material blend. The excess
Neptune oxide material is stockpiled and fed to the mill so as to
maintain the optimum blend.
Throughput at the Lefroy mill was similar at 1.08 million tonnes.
Yield decreased by 2 per cent from 2.58 grams per tonne to 2.53
grams per tonne due to lower grades mined.
Cost of sales before amortisation and depreciation, increased by
28 per cent from A$65 million (US$48 million) to A$83 million
(US$60 million). The increase was due to a gold inventory charge
to costs of A$16 million (US$12 million) in the December quarter
compared with A$nil (US$nil) in the September quarter.
Capital expenditure decreased by 6 per cent from A$50 million
(US$36 million) to A$47 million (US$34 million) due to lower capital
development at Hamlet underground. Capital expenditure at
Hamlet of A$nil (US$nil) in the December quarter compared with
A$3 million (US$2 million) in the September quarter.
All-in sustaining costs and total all-in cost increased by 13 per cent
from A$1,355 per ounce (US$993 per ounce) in the September
quarter to A$1,533 per ounce (US$1,109 per ounce) in the
December quarter due to higher cost of sales before amortisation
and depreciation and lower gold sold, partially offset by lower
capital expenditure.
Agnew
Dec
2018
Sept
2018
Gold produced
000’oz
62.4
61.3
Gold sold
000’oz
60.2
61.4
Yield
g/t
6.93
6.15
AISC and AIC
A$/oz
1,413
1,300
US$/oz
1,013
945
Gold production increased by 2 per cent from 61,300 ounces in
the September quarter to 62,400 ounces in the December quarter
mainly due to higher grades mined and processed.
Ore mined from underground decreased by 1 per cent from
301,800 tonnes in the September quarter to 297,400 tonnes in the
December quarter. Head grade mined decreased by 7 per cent
from 6.97 grams per tonnes to 6.49 grams per tonne mainly due
to a decrease in ore mined from Waroonga’s high grade Bengal
area in the December quarter. Gold mined decreased by 8 per
cent from 67,700 ounces to 62,000 ounces due to lower grades
mined. In the December quarter tonnes mined were sourced as
follows: 153,800 tonnes at 8.2 grams per tonne from Waroonga
and 143,600 tonnes at 4.6 grams per tonne from New Holland.
This compared with 153,200 tonnes at 10.2 grams per tonne from
Waroonga and 148,600 tonnes at 3.7 grams per tonne from New
Holland in the September quarter.
Tonnes processed decreased by 10 per cent from 310,400 tonnes
in the September quarter to 279,800 tonnes in the December
quarter due to planned mill maintenance and unplanned jaw
crusher maintenance in the December quarter The combined
yield increased by 13 per cent from 6.15 grams per tonne to 6.93
grams per tonne due to the processing of high grade stockpiled
material sourced from Waroonga's Bengal area in the September
quarter, and the processing of a historic New Holland stockpile
which returned a positive grade reconciliation.
.
Cost of sales before amortisation and depreciation, increased by
6 per cent from A$52 million (US$38 million) in the September
quarter to A$55 million (US$39 million) in the December quarter
mainly due to an increase in mining costs at Waroonga (A$3
million/US$2 million) as a result of increased ore development in
the December quarter and mill maintenance cost (A$1
million/US$1 million) following the mill and crusher maintenance
shutdown in the December quarter.
Capital expenditure increased by 13 per cent from A$24 million
(US$18 million) to A$27 million (US$20 million) mainly due to
increased expenditure on a new accommodation village in the
December quarter.
All-in sustaining costs and total all-in cost increased by 9 per cent
from A$1,300 per ounce (US$945 per ounce) in the September
quarter to A$1,413 per ounce (US$1,013 per ounce) in the
December quarter due to higher cost of sales before amortisation
and depreciation and higher capital expenditure as well as lower
gold sold.
Granny Smith
Dec
2018
Sept
2018
Gold produced
000’oz
71.0
72.1
Gold sold
000’oz
71.2
71.8
Yield
g/t
4.77
4.68
AISC and AIC
A$/oz
1,204
1,311
US$/oz
862
957
Gold production decreased by 2 per cent from 72,100 ounces in
the September quarter to 71,000 ounces in the December quarter
mainly due to lower tonnes processed.
Ore mined from underground increased marginally from 460,800
tonnes to 461,900 tonnes. Head grade mined increased by 4 per
cent from 4.94 grams per tonne in the September quarter to 5.15
grams per tonne in the December quarter in line with the
geotechnical sequencing. As a result, overall ounces mined
increased by 5 per cent from 73,200 ounces in the September
quarter to 76,500 ounces in the December quarter.
Tonnes processed decreased by 3 per cent from 478,700 tonnes
in the September quarter to 464,000 tonnes in the December
quarter due to timing of milling campaigns quarter on quarter. The
39
Gold Fields 2018 RESULTS
yield increased by 2 per cent from 4.68 grams per tonne to 4.77
grams per tonne due to higher head grade mined.
Cost of sales before amortisation and depreciation, increased by
2 per cent from A$60 million (US$44 million) in the September
quarter to A$61 million (US$44 million) in the December quarter
mainly due to a A$1 million (US$1 million) increase in mining costs
as a result of increased ore mined.
Capital expenditure decreased by 27 per cent from A$30 million
(US$22 million) to A$22 million (US$15 million). The lower
expenditure was due to lower mine capital development
expenditure of A$3 million (US$2 million) with focus on ore
development, lower exploration cost (A$3 million/US$2 million)
and lower infrastructure expenditure following final payments for
the new paste plant in the September quarter (A$3 million/US$2
million).
All-in sustaining costs and total all-in cost decreased by 8 per cent
from A$1,311 per ounce (US$957 per ounce) to A$1,204 per ounce
(US$862 per ounce) due to lower capital expenditure, partially
offset by increased cost of sales before amortisation and
depreciation and lower gold sold.
Gold Fields Dec 2018 RESULTS
40
SALIENT FEATURE AND COST BENCHMARKS (UNREVIEWED)
Figures are in millions
unless otherwise stated
United States Dollars
Total
Mine
Operations
Including
Equity
accounted
Joint Venture
Total
Mine
Operations
Excluding
Equity
accounted
Joint Venture
Total
Mine
Continuing
Operations
Excluding
Equity
accounted
Joint Venture
South Africa
Region
West Africa
Region
South
America
Region
Ghana
Peru
South
Deep
Total
Tarkwa
Damang
Asanko*
45%
Cerro
Corona
Ore milled/treated
Dec 2018
8,571
8,014
8,014
159
4,986
3,457
972
557
1,602
(000 tonnes)
Sept 2018
8,878
8,491
8,491
387
4,914
3,450
1,077
387
1,712
Dec 2017
8,450
8,450
8,609
557
4,479
3,307
1,172
−
1,659
Yield
Dec 2018
1.8
1.8
1.8
2.1
1.2
1.2
1.3
1.5
1.8
(grams per tonne)
Sept 2018
2.0
2.0
2.0
4.0
1.2
1.1
1.6
1.4
1.5
Dec 2017
2.1
2.1
2.1
4.5
1.2
1.3
0.9
−
1.5
Gold produced
Dec 2018
526.5
499.6
499.6
11.0
200.9
134.0
40.0
26.9
93.2
(000 managed equivalent ounces)
Sept 2018
550.7
533.1
533.1
49.5
195.5
126.5
51.3
17.6
83.2
Dec 2017
564.1
564.1
570.1
80.8
174.3
139.8
34.5
−
80.0
Gold sold
Dec 2018
524.9
497.1
497.1
16.3
201.9
134.0
40.0
27.8
87.4
(000 managed equivalent ounces)
Sept 2018
545.6
527.5
527.5
47.3
195.9
126.5
51.3
18.1
80.0
Dec 2017
572.0
572.0
570.3
80.4
174.3
139.8
34.5
−
88.2
Cost of sales before amortisation
Dec 2018
(372.3)
(348.4)
(348.4)
(52.0)
(139.1)
(82.6)
(32.6)
(23.9)
(38.4)
and depreciation
Sept 2018
(352.2)
(338.7)
(338.7)
(66.1)
(118.6)
(76.0)
(29.1)
(13.5)
(38.9)
(million)
Dec 2017
(353.3)
(353.1)
(325.4)
(75.0)
(105.5)
(72.3)
(33.2)
−
(45.2)
Cost of sales before gold inventory
Dec 2018
43
43
43
267
30
25
40
46
27
change and amortisation and
Sept 2018
41
41
41
178
26
21
34
41
23
depreciation (dollar per tonne)
Dec 2017
43
43
42
128
27
27
27
−
25
Sustaining capital
Dec 2018
(134.2)
(129.8)
(129.8)
(10.8)
(42.1)
(34.2)
(3.4)
(4.4)
(12.6)
(million)
Dec 2018
(142.5)
(139.0)
( (139.0)
(10.5)
(45.3)
(38.3)
(3.5)
(3.5)
(10.7)
Dec 2017
(178.2)
(178.2)
(149.6)
(22.3)
(41.8)
(41.8)
(3.3)
−
(11.5)
Non-sustaining capital
Dec 2018
(33.5)
(29.0)
(29.0)
(1.3)
(32.2)
#
–
(27.7)
#
(4.5)
(million)
Dec 2018
(36.3)
(35.9)
(35.9)
(4.8)
(31.5)
#
−
(31.1)
#
(0.4)
−
Dec 2017
(36.1)
(36.1)
(38.6)
(8.1)
(28.0)
#
−
(28.0)
#
−
−
Total capital expenditure
Dec 2018
(167.7)
(158.8)
(158.8)
(12.1)
(74.2)
(34.2)
(31.1)
(8.9)
(12.6)
(million)
Dec 2018
(178.8)
(174.9)
(174.9)
(15.3)
(76.8)
(38.3)
(34.6)
(3.9)
(10.7)
Dec 2017
(214.3)
(214.3)
(188.0)
(30.4)
(69.8)
(41.8)
(28.0)
−
(11.5)
All-in-sustaining costs
Dec 2018
1,009
1,003
1,003
3,906
951
924
937
1,105
252
(dollar per ounce)
Sept 2018
966
960
960
1,663
900
972
682
1,018
443
Dec 2017
945
945
945
1,209
895
871
991
−
209
Total all-in-cost
Dec 2018
1,076
1,064
1,064
3,986
1,105
924
1,601
1,266
252
(dollar per ounce)
Sept 2018
1,038
1,034
1,034
1,764
1,061
972
1,288
1,039
443
Dec 2017
1,013
1,013
1,310
1,310
1,055
871
1,802
−
209
United States Dollars
Australian Dollars
South African
Rand
United States
Dollars
Australian
Dollars
Australia
Region
Australia
Region
South Africa
Region
Australia
Region
Australia
Region
Continuing
Continuing
Discontinued
Discontinued
Total
St Ives
Agnew/
Lawlers
Granny
Smith
Total
St Ives
Agnew/
Lawlers
Granny
Smith
South
Deep
Darlot
Darlot
Operating Results
Ore milled/treated
Dec 2018
1,824
1,081
280
463
1,824
1,081
280
463
159
–
–
(000 tonnes)
Sept 2018
1,866
1,077
310
479
1,866
1,077
310
479
387
–
–
Dec 2017
1,755
1,040
296
419
1,755
1,040
296
419
557
–
–
Yield
Dec 2018
3.8
2.5
6.9
4.8
3.8
2.5
6.9
4.8
2.1
–
–
(grams per tonne)
Sept 2018
3.7
2.6
6.2
4.7
3.7
2.6
6.2
4.7
4.0
–
–
Dec 2017
4.1
2.7
6.7
5.6
4.1
2.7
6.7
5.6
4.5
–
–
Gold produced
Dec 2018
221.3
87.9 0
62.4
71.0
221.3
87.9
62.4
71.0
343
–
–
(000 managed
Sept 2018
222.6
89.2
61.3
72.1
222.6
89.2
61.3
72.1
1,539
–
–
equivalent ounces)
Dec 2017
229.1
90.3
63.9
74.8
229.1
90.3
63.9
74.8
2,512
–
–
Gold sold
Dec 2018
219.3
87.9
60.2
71.2
219.3
87.9
60.2
71.2
508
–
–
(000 managed
Sept 2018
222.1
88.9
61.4
71.8
222.1
88.9
61.4
71.8
1,472
–
–
equivalent ounces)
Dec 2017
229.1
90.3
63.9
74.8
229.1
90.3
63.9
74.8
2,500
–
–
Cost of sales before
Dec 2018
(142.8)
(60.1)
(39.2)
(43.5)
(198.1)
(82.8)
(54.7)
(60.6)
(762.7)
–
–
amortisation and
Sept 2018
(128.6)
(47.5)
(37.6)
(43.6)
(176.1)
(64.6)
(51.8)
(59.7)
(941.0)
–
–
depreciation (million)
Dec 2017
(127.3)
(43.2)
(40.3)
(43.9)
(165.7)
(56.2)
(52.4)
(57.0)
(1,026.9)
(0.2)
(0.3)
Cost of sales before gold
inventory change and
amortisation and
Dec 2018
73
45
146
94
101
62
203
130
4,797
–
–
depreciation
Dec 2018
68
43
122
87
93
60
168
120
2,494
–
–
(dollar per tonne)
Dec 2017
76
51
137
97
99
66
178
126
1,748
–
–
Sustaining capital
Dec 2018
(68.7)
(33.8)
(19.7)
(15.3)
(95.9)
(46.9)
(27.4)
(21.6)
(152.7)
–
–
(million)
Dec 2018
(76.0)
(36.4)
(17.7)
(21.9)
(103.9)
(49.6)
(24.2)
(30.0)
(145.7)
–
–
Dec 2017
(102.6)
(46.9)
(23.3)
(32.4)
(133.5)
(61.0)
(30.3)
(42.2)
(303.5)
–
–
Non-sustaining capital
Dec 2018
−
−
−
−
−
−
−
−
(24.0)
−
−
(million)
Dec 2018
–
–
–
–
–
–
–
–
(68.7)
–
–
Dec 2017
−
−
−
−
−
−
−
−
(55.2)
−
−
Total capital
Dec 2018
(68.7)
(33.8)
(19.7)
(15.3)
(95.9)
(46.9)
(27.4)
(21.6)
(176.7)
–
–
expenditure
Dec 2018
(76.0)
(36.4)
(17.7)
(21.9)
(103.9)
(49.6)
(24.2)
(30.0)
(214.4)
–
–
(million)
Dec 2017
(102.6)
(46.9)
(23.3)
(32.4)
(133.5)
(61.0)
(30.3)
(42.2)
(412.2)
−
−
All-in-sustaining costs
Dec 2018
1,003
1,109
1,013
862
1,393
1,533
1,413
1,204
1,834,112
–
–
(dollar per ounce)
Sept 2018
969
993
945
957
1,325
1,355
1,300
1,311
758,304
–
–
Dec 2017
1,040
1,035
1,029
1,054
1,350
1,351
1,336
1,370
532,573
–
–
Total all-in-cost
Dec 2018
1,003
1,109
1,013
862
1,393
1,533
1,413
1,204
1,881,395
–
–
(dollar per ounce)
Sept 2018
969
993
945
957
1,325
1,355
1,300
1,311
804,998
–
–
Dec 2017
1,040
1,035
1,029
1,054
1,350
1,351
1,336
1,370
576,043
–
–
Average exchange rates were US$1 = R14.27, US$1 = R14.03 and US$1 = R13.69 for the December Dec 2018, September Dec 2018 and December Dec 2017 quarters, respectively.
The Australian/US dollar exchange rates were A$1 = US$0.72, A$1 = US$0.73 and A$1 = US$0.77 for the December Dec 2018, September Dec 2018 and December Dec 2017 quarters, respectively.
Figures may not add as they are rounded independently.
#
Relates to non-sustaining capital expenditure for Damang re-investment project
.
* Equity accounted Joint Venture
41
Gold Fields 2018 RESULTS
UNDERGROUND AND SURFACE (UNREVIEWED)
United States Dollars
Imperial ounces with metric
tonnes and grade
Total Mine
Operations
Including
Equity
accounted
Joint
Venture
South
Africa
Region
West
Africa
Region
South
America
Region
Australia
Region
Ghana
Peru
Continuing
South
Deep
Total
Tarkwa Damang
Asanko
#
45%
Cerro
Corona
Total
St Ives
Agnew/
Lawlers
Granny
Smith
Tonnes mined
Dec 2018
1,144
62
–
–
–
–
–
1,082
323
297
462
(000 tonnes)*
Sept 2018
1,314
277
–
–
–
–
–
1,037
275
302
461
– underground ore
Dec 2017
1,154
336
–
–
–
–
–
818
97
313
408
Dec 2018
17
17
–
–
–
–
–
–
–
–
–
– underground waste
Sept 2018
42
42
–
–
–
–
–
–
–
–
–
Dec 2017
58
58
–
–
–
–
–
–
–
–
–
Dec 2018
8,113
–
6,005
3,963
1,427
616
1,819
289
289
–
–
– surface ore
Sept 2018
7,645
–
5,352
3,511
1,317
525
1,741
552
552
–
–
Dec 2017
7,761
–
4,992
4,240
752
–
1,753
1,016
1,016
–
–
Dec 2018
9,274
79
6,005
3,963
1,427
616
1,819
1,371
611
297
462
– total
Sept 2018
9,000
319
5,352
3,511
1,317
525
1,741
1,589
827
302
461
Dec 2017
8,973
394
4,992
4,240
752
–
1,753
1,834
1,113
313
408
Grade mined
Dec 2018
5.2
4.7
–
–
–
–
–
5.1
3.8
6.5
5.2
(grams per tonne)
Sept 2018
5.6
6.1
–
–
–
–
–
5.3
3.9
7.0
4.9
– underground ore
Dec 2017
5.9
6.2
–
–
–
–
–
5.6
3.7
6.2
5.6
Dec 2018
–
–
–
–
–
–
–
–
–
–
–
– underground waste
Sept 2018
–
–
–
–
–
–
–
–
–
–
–
Dec 2017
–
–
–
–
–
–
–
–
–
–
–
Dec 2018
1.4
–
1.2
1.2
1.5
1.5
1.4
1.4
1.4
–
–
– surface ore
Sept 2018
1.4
–
1.4
1.2
1.7
1.5
1.1
2.3
2.3
–
–
Dec 2017
1.5
–
1.3
1.3
1.1
–
1.1
3.0
3.0
–
–
Dec 2018
1.9
3.8
1.2
1.2
1.5
1.5
1.4
4.3
2.7
6.5
5.2
– total
Sept 2018
2.0
5.3
1.4
1.2
1.7
1.5
1.1
4.3
2.9
7.0
4.9
Dec 2017
2.1
5.3
1.3
1.3
1.1
–
1.1
4.2
3.1
6.2
5.6
Gold mined
Dec 2018
186.6
9.0
–
–
–
–
–
177.6
39.1
62.0
76.5
(000 ounces)*
Sept 2018
230.2
54.6
–
–
–
–
–
175.6
34.8
67.7
73.2
– underground ore
Dec 2017
210.9
64.5
–
–
–
–
–
146.4
11.4
62.2
72.8
Dec 2018
–
–
–
–
–
–
–
–
–
–
–
– underground waste
Sept 2018
–
–
–
–
–
–
–
–
–
–
–
Dec 2017
–
–
–
–
–
–
–
–
–
–
–
Dec 2018
347.6
0.3
255.3
157.2
68.8
29.3
79.0
13.1
13.1
–
–
– surface ore
Sept 2018
339.6
0.4
233.7
136.4
72.7
24.7
64.0
41.6
41.6
–
–
Dec 2017
362.2
–
202.4
176.7
25.7
–
60.6
99.2
99.2
–
–
Dec 2018
534.2
9.3
255.3
157.2
68.8
29.3
79.0
190.7
52.2
62.0
76.5
– total
Sept 2018
569.9
54.9
233.7
136.4
72.7
24.7
64.0
217.3
76.5
67.7
73.2
Dec 2017
573.1
64.5
202.4
176.7
25.7
–
60.6
245.6
110.6
62.2
72.8
Ore milled/treated
Dec 2018
1,096
63
–
–
–
–
–
1,033
289
280
463
(000 tonnes)* ^
Sept 2018
1,264
271
–
–
–
–
–
993
204
310
479
– underground ore
Dec 2017
1,169
414
–
–
–
–
–
755
40
296
419
Dec 2018
26
26
–
–
–
–
–
–
–
–
–
– underground waste ^
Sept 2018
42
43
–
–
–
–
–
–
–
–
–
Dec 2017
39
39
–
–
–
–
–
–
–
–
–
Dec 2018
7,449
70
4,986
3,457
972
557
1,602
792
792
–
–
– surface ore
Sept 2018
7,572
73
4,914
3,450
1,077
387
1,712
873
873
–
–
Dec 2017
7,242
104
4,479
3,307
1,172
–
1,659
1,000
1,000
–
–
Dec 2018
8,571
159
4,986
3,457
972
557
1,602
1,825
1,081
280
463
– total
Sept 2018
8,878
387
4,914
3,450
1,077
387
1,712
1,866
1,077
310
479
Dec 2017
8,450
557
4,479
3,307
1,172
–
1,659
1,755
1,040
296
419
Yield
Dec 2018
5.1
5.3
–
–
–
–
–
5.0
3.6
7.0
4.9
(Grams per tonne)
Sept 2018
4.9
5.6
–
–
–
–
–
4.9
3.7
6.2
4.7
– underground ore
Dec 2017
5.7
6.0
–
–
–
–
–
5.9
2.9
6.8
5.5
Dec 2018
–
–
–
–
–
–
–
–
–
–
–
– underground waste
Sept 2018
–
–
–
–
–
–
–
–
–
–
–
Dec 2017
–
–
–
–
–
–
–
–
–
–
–
Dec 2018
1.3
0.1
1.2
1.2
1.3
1.5
1.8
2.1
2.1
–
–
– surface ore
Sept 2018
1.5
0.1
1.2
1.1
1.6
1.4
1.5
2.3
2.3
–
–
Dec 2017
1.5
0.1
1.2
1.3
0.9
–
1.5
2.7
2.7
–
–
Dec 2018
1.8
2.1
1.2
1.2
1.3
1.5
1.8
3.8
2.5
6.9
4.8
– combined
Sept 2018
2.0
4.0
1.2
1.1
1.6
1.4
1.5
3.7
2.6
6.2
4.7
Dec 2017
2.1
4.5
1.2
1.3
0.9
–
1.5
4.1
2.7
6.7
5.6
Gold produced
Dec 2018
177.7
10.7
–
–
–
–
–
167.0
33.6
62.4
71.0
(000 ounces)*
Sept 2018
207.1
49.2
–
–
–
–
–
157.9
24.5
61.3
72.1
– underground ore
Dec 2017
222.9
80.5
–
–
–
–
–
142.4
3.7
63.9
74.8
Dec 2018
–
–
–
–
–
–
–
–
–
–
–
– underground waste
Sept 2018
–
–
–
–
–
–
–
–
–
–
–
Dec 2017
–
–
–
–
–
–
–
–
–
–
–
Dec 2018
348.8
0.3
200.9
134.0
40.0
26.9
93.2
54.3
54.3
–
–
– surface ore
Sept 2018
343.8
0.3
195.5
126.5
51.3
17.6
83.2
64.7
64.7
–
–
Dec 2017
341.3
0.3
174.3
139.8
34.5
–
80.0
86.6
86.6
–
–
Dec 2018
526.5
11.0
200.9
134.0
40.0
26.9
93.2
221.3
87.9
62.4
71.0
– total
Sept 2018
550.7
49.5
195.5
126.5
51.3
17.6
83.2
222.6
89.2
61.3
72.1
Dec 2017
564.4
80.8
174.3
139.8
34.5
–
80.0
229.1
90.3
63.9
74.8
Cost of sales before gold
inventory change and
amortisation and
depreciation
(dollar per tonne)
Dec 2018
132
476
–
–
–
–
–
99
`
64
146
94
Sept 2018
131
221
–
–
–
–
–
30
30
122
87
– underground
Dec 2017
132
156
–
–
–
–
–
110
53
137
97
Dec 2018
30
3
30
25
40
46
27
37
37
–
–
– surface
Sept 2018
26
2
26
21
34
41
23
47
47
–
–
Dec 2017
29
3
27
27
27
–
25
50
50
–
–
Dec 2018
43
267
30
25
40
46
27
73
45
146
94
– total
Sept 2018
41
178
26
21
34
41
23
68
43
122
87
Dec 2017
43
128
27
27
27
–
25
76
51
137
97
* Excludes surface material at South Deep.
#
Includes only 45 per cent of Asanko (Equity accounted Joint Venture).
^ Reef and ore milled were adjusted.
Gold Fields 2018 RESULTS
42
ADMINISTRATION AND CORPORATE INFORMATION
Corporate Secretary
Lucy Mokoka
Tel: +27 11 562 9719
Fax: +27 11 562 9829
e-mail: lucy.mokoka@goldfields.com
Registered office
Johannesburg
Gold Fields Limited
150 Helen Road
Sandown
Sandton
2196
Postnet Suite 252
Private Bag X30500
Houghton
2041
Tel: +27 11 562 9700
Fax: +27 11 562 9829
Office of the United Kingdom secretaries
London
St James’s Corporate Services Limited
Suite 31, Second Floor
107 Cheapside
London
EC2V 6DN
United Kingdom
Tel: +44 20 7796 8644
Fax: +44 20 7796 8645
e-mail: general@corpserv.co.uk
American depository receipts transfer agent
Shareholder correspondence should be mailed to:
BNY Mellon Shareowner Services
P O Box 30170
College Station, TX 77842-3170
Overnight correspondence should be sent to:
BNY Mellon Shareowner Services
211 Quality Circle, Suite 210
College Station, TX 77845
e-mail: shrrelations@cpushareownerservices.com
Phone numbers
Tel: 888 269 2377 Domestic
Tel: 201 680 6825 Foreign
Sponsor
J.P. Morgan Equities South Africa (Pty) Ltd
Gold Fields Limited
Incorporated in the Republic of South Africa
Registration number 1968/004880/06
Share code: GFI
Issuer code: GOGOF
ISIN – ZAE 000018123
Investor enquiries
Avishkar Nagaser
Tel: +27 11 562 9775
Mobile: +27 82 312 8692
e-mail: avishkar.nagaser@goldfields.com
Thomas Mengel
Tel: +27 11 562 9849
Mobile: +27 72 493 5170
e-mail: thomas.mengel@goldfields.com
Media enquiries
Sven Lunsche
Tel: +27 11 562 9763
Mobile: +27 83 260 9279
e-mail: sven.lunsche@goldfields.com
Transfer secretaries
South Africa
Computershare Investor Services (Proprietary) Limited
Rosebank Towers
15 Biermann Avenue
Rosebank
Johannesburg
2196
P O Box 61051
Marshalltown
2107
Tel: +27 11 370 5000
Fax: +27 11 688 5248
United Kingdom
Link Asset Services
The Registry
34 Beckenham Road
Beckenham
Kent BR3 4TU
England
Tel: 0871 664 0300
Calls cost 12p per minute plus your phone company's access
charge.
If you are outside the United Kingdom,
please call +44 371 664 0300.
Calls outside the United Kingdom will be charged at the applicable
international rate.
The helpline is open between 9:00am – 5:30pm. Monday to Friday
excluding public holidays in England and Wales.
e-mail:enquires@linkgroup.co.uk
Website
WWW.GOLDFIELDS.COM
Listings
JSE / NYSE / GFI
SWX: GOLI
CA Carolus°
(Chair)
RP Menell° (Deputy Chair) NJ Holland*
· (Chief Executive Officer)
PA Schmidt ·
(Chief Financial Officer)
A Andani
#
° PJ Bacchus° TP Goodlace° C Lettonˆ° P Mahanyele-Dabengwa · SP Reidˆ° YGH Suleman°
ˆ Australian * British
#
Ghanaian
° Independent Director · Non-independent Director
43
Gold Fields 2018 H1 RESULTS
INDEPENDENT AUDITOR’S REVIEW REPORT ON CONDENSED CONSOLIDATED
FINANCIAL STATEMENTS
To the shareholders of Gold Fields Limited
We have reviewed the condensed consolidated financial
statements of Gold Fields Limited, contained in the
accompanying preliminary report, which comprise the
condensed consolidated statement of financial position as at 31
December 2018 and the condensed consolidated income
statement and the condensed consolidated statements of
comprehensive income, changes in equity and cash flows for the
year then ended, and selected explanatory notes, and the
segmental financial results as set out on pages 19 – 29.
Directors’ Responsibility for the Condensed Consolidated
Financial Statements
The directors are responsible for the preparation and
presentation of these condensed consolidated financial
statements in accordance with the requirements of the JSE
Limited Listings Requirements for preliminary reports, as set out
in the “Basis for preparation” note to the financial statements,
and the requirements of the Companies Act of South Africa, and
for such internal control as the directors determine is necessary
to enable the preparation of financial statements that are free
from material misstatement, whether due to fraud or error.
Auditor’s Responsibility
Our responsibility is to express a conclusion on these financial
statements. We conducted our review in accordance with
International Standard on Review Engagements (ISRE) 2410,
which applies to a review of historical information performed by
the independent auditor of the entity. ISRE 2410 requires us to
conclude whether anything has come to our attention that
causes us to believe that the financial statements are not
prepared in all material respects in accordance with the
applicable financial reporting framework. This standard also
requires us to comply with relevant ethical requirements.
A review of financial statements in accordance with ISRE 2410 is
a limited assurance engagement. We perform procedures,
primarily consisting of making inquiries of management and
others within the entity, as appropriate, and applying analytical
procedures, and evaluate the evidence obtained.
The procedures performed in a review are substantially less than
those performed in an audit conducted in accordance with
International Standards on Auditing. Accordingly, we do not
express an audit opinion on these financial statements.
Conclusion
Based on our review, nothing has come to our attention that
causes us to believe that the condensed consolidated financial
statements of Gold Fields Limited for the year ended 31
December 2018 are not prepared, in all material respects, in
accordance with the requirements of the JSE Limited Listings
Requirements for preliminary reports, as set out in the “Basis for
preparation” note to the financial statements, and the
requirements of the Companies Act of South Africa.
KPMG Inc.
Registered Auditor
Per Mandy Watson
Chartered Accountant (SA)
Registered Auditor
Director
15 February 2019
85 Empire Road
Parktown
South Africa
Gold Fields 2018 RESULTS
44
Certain forward looking statements
This report contains forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, or the
Securities Act, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended, or the Exchange Act, with respect to Gold Fields’
financial condition, results of operations, business strategies, operating efficiencies, competitive position, growth opportunities for existing
services, plans and objectives of management, markets for stock and other matters. Such forward-looking statements can be identified by
the use of forward-looking terminology, including the terms "believes", "estimates", "plans", "anticipates", "aims", "continues", "expects",
"hopes", "may", "will", "would" or "could" or, in each case, their negative or other various or comparable terminology.
These forward-looking statements, including, among others, those relating to the future business prospects, revenues and income of Gold
Fields, wherever they may occur in this report, are necessarily estimates reflecting the best judgment of the senior management of Gold
Fields and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the
forward-looking statements. As a consequence, these forward-looking statements should be considered in light of various important factors,
including those set forth in this report. Important factors that could cause actual results to differ materially from estimates or projections
contained in the forward-looking statements include, without limitation:
· overall economic and business conditions in South Africa, Ghana, Australia, Peru and elsewhere;
· changes in assumptions underlying Gold Fields’ mineral reserve estimates;
· the ability of the Group to achieve anticipated efficiencies and other cost savings in connection with past and future acquisitions or joint
ventures;
· the ability of the Group to achieve anticipated efficiencies and other cost savings as a result of measures such as retrenchments;
· the ability of the Group to achieve anticipated production cost estimates at existing operations, projects or joint ventures as outlined in
this report or as otherwise disclosed;
· the success of the Group’s business strategy, development activities and other initiatives;
· the ability of the Group to comply with requirements that it operate in a sustainable manner and provide benefits to affected
communities;
· decreases in the market price of gold or copper;
· the occurrence of hazards associated with underground and surface gold mining or contagious diseases at Gold Fields’ operations,
projects or joint ventures;
· the occurrence of work stoppages related to health and safety incidents at Gold Fields’ operations, projects or joint ventures;
· the Group’s loss of senior management or inability to hire or retain employees;
· fluctuations in exchange rates, currency devaluations and other macro-economic monetary policies;
· ongoing or future labour disruptions and industrial actions at Gold Fields’ operations, projects or joint ventures;
· power cost increases as well as power stoppages, fluctuations and usage constraints;
· supply chain shortages and increases in the prices of production imports;
· the ability to manage and maintain access to current and future sources of liquidity, capital and credit, including the terms and conditions
of Gold Fields’ facilities and Gold Fields’ overall cost of funding;
· the adequacy of the Group’s insurance coverage;
· the manner, amount and timing of capital expenditures made by Gold Fields on both existing and new mines, mining projects,
exploration project or other initiatives;
· changes in relevant government regulations, particularly labour, environmental, tax, royalty, health and safety, water, regulations and
potential new legislation affecting Gold Fields’ mining and mineral rights;
· fraud, bribery or corruption at Gold Fields’ operations, projects or joint ventures that leads to censure, penalties or negative reputational
· impacts; and
· political instability in South Africa, Ghana, Peru or regionally in Africa or South America.
Gold Fields undertakes no obligation to update publicly or release any revisions to these forward-looking statements to reflect events or
circumstances after the date of this report or to reflect the occurrence of unanticipated events.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused
this report to be signed on behalf by the undersigned, thereunto duly authorised.
GOLD FIELDS LIMITED
Dated: 15 February 2019
By:
/s/ Nicholas J. Holland
Name:
Nicholas J. Holland
Title:
Chief Executive Officer