6-K 1 goldfields_results.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 August 2019
Commission File Number: 001-31318
GOLD FIELDS LIMITED
(Translation of registrant’s name into English)
150 Helen Road.
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
US$49 million
cash inflow
from operating activities*
1,083
million ounces of
attributable gold production
US$1,106
per ounce of
All-in costs
Gruyere commissioned
Successful debt refinancing
Group returns to cash flow positive after a
two-year reinvestment period
US$88 million realised from disposal of
non-core investments
Net debt reduced
On track to achieve guidance
Note: *Cash flow from operating activities less net capital expenditure, environmental payments and finance lease payments.
JOHANNESBURG. 15 August 2019:
Gold Fields Limited (NYSE & JSE: GFI) today announced profit
attributable to owners of the parent for the six months to 30 June 2019 of US$71m (US$0.09 per share).
This compared with losses of US$367m (US$0.45 per share) for the six months to 30 June 2018.
Normalised profit of US$126m for the six months to 30 June 2019 compared with US$43m for the
six months to 30 June 2018.
An interim dividend of 60 SA cents per share (gross) is payable on 9 September 2019.
Statement by Nick Holland,
Chief Executive Officer
of Gold Fields
Safety is our first value
It is with deep sadness that we have to
report that Maria Ramela, an employee at
South Deep, lost her life in a mining
incident on 2 June 2019. The 38-year old
trackless crew leader was fatally injured
after being struck by a rock ejected from
the rockface following a series of four
seismic events in close proximity and
quick succession.
In addition, three serious injuries were
reported for H1 2019, compared with two
in H1 2018. These incidents serve as a
stark reminder that our focus on safety
has to be relentless. In this regard, in
2017 our Executive team initiated a
Safety Leadership Group, which is
chaired by Stuart Mathews, Executive
Vice President Australia. One of the key
strategic objectives of this group, is to
develop a culture of safety leadership
within the organisation and firmly embed
safety management through systems,
behaviour and leadership.
A workshop was held in July 2019, where
a dedicated safety leadership training
package called Courageous Safety
Leadership was launched. The training
will be rolled out across the organisation
and will be standard for all new
employees. We will also be extending our
Australian behaviour-based programme,
Vital Behaviours, to entrench safe
behaviours and choices within every
activity across the entire business.
Turning net cash flow positive in H1
2019
We are pleased to report that after a two-
year reinvestment period (2017 and
2018), Gold Fields turned net cash flow
positive in H1 2019, earlier than originally
anticipated, generating US$49m for the
six month period (after taking into account
all costs in the business including debt
service costs and all project capex),
which compares to the net cash outflow of
US$79m in H1 2018. We expect the
Group’s cash generating ability to
increase in H2 2019 and into 2020 as the
project capex reduces and contribution
from the new projects increases.
Gold Fields 2019 H1 RESULTS
2
Looking at the core operations (excluding project spending on
Gruyere), the group generated net cash flow of US$198m in H1
2019 compared with US$128m generated in Q2 2019.
As reported in Q1 2019, Gold Fields adopted the new lease
accounting standard (IFRS 16) on 1 January 2019, which has
impacted the reporting of net debt and the net debt to EBITDA
ratio. On the new classification, the net debt balance at the end
of June 2019 was US$1.79bn, with a net debt to EBITDA ratio of
1.59x. Using the old classification (pre-IFRS 16), the net debt
balance at the end of June 2019 was US$1.50bn, which is an
improvement on that reported at the end of December 2018 of
US$1.61bn. The net debt to EBITDA also improved over the six
month period to 1.36x at the end of H1 2019 from 1.45x at the
end of FY 2018.
As reported in the recent trading statement, attributable gold
equivalent production for the six months ended 30 June 2019
increased by 9% YoY to 1,083koz (H1 2018: 994koz), mainly
due to the inclusion of the contribution from Asanko in H1 2019.
On 14 November 2018, the World Gold Council (WGC)
published an update to its guidance on the interpretation of all-in
sustaining costs (AISC) and all-in costs (AIC). Gold Fields has
adopted the revision prospectively from 1 January 2019. Based
on the revised WGC guidance, AISC for the Group is US$891/oz
for H1 2019. On the previous interpretation, AISC for the period
was US$973/oz (H1 2018: US$965/oz), marginally higher YoY.
Whilst cognisant that Gold Fields has been funding two major
projects (Damang and Gruyere) over the past two years, AIC for
H1 2019 was 5% lower YoY at US$1,106/oz (H1 2018:
US$1,169/oz) as project capital started to decrease. AIC
reporting was not affected by the revised WGC guidance.
Normalised earnings for the six months ended June 2019 were
US$126m or US$0.15 per share, compared with US$43m or
US$0.05 per share in for the six months ended June 2018.
In line with our dividend policy of paying out between 25% and
35% of normalised profit as dividends, we have declared an
interim dividend of 60 SA cents per share, which compared with
the 2018 interim dividend of 20 SA cents per share.
Update on projects
Gruyere
Gruyere reached the milestone of pouring first gold just post the
close of the June 2019 quarter, with three dore gold bars totalling
1,139oz being produced from the Carbon-in-Leach (CIL) and
elution circuits. With delivery of first gold, focus shifted to
commissioning of the final components of the processing plant,
in particular the ball mill was completed and brought into
production in July - August.
Mining activity has delivered 2.5 million tonnes of ore mined
year-to-date and is ahead of plan. Ore delivery comprised
1.3 million tonnes of ore at a grade of 1.04g/t for 43koz, and a
further 1.2 million tonnes of low grade at 0.61g/t for 22koz
(100% basis). Low grade ore has been used for initial plant feed
during commissioning, final construction and sheeting of the
Run-of-Mine stockpile platform, reclaim stockpile, and
planned building of low grade stockpiles for the longer term.
Practical completion (plant running uninterrupted for 96 hours)
was achieved on 10 August and the ramp-up to steady state is
progressing well.
As previously announced, production for FY 2019 is now
expected to be between 75koz to 100koz (100% basis), while
the Final Forecast Capital Cost estimate remains unchanged at
A$621m (100% basis).
AIC for FY 2019 is expected to be A$4,450/oz (previously
A$3,178/oz), based on gold sold (associated with the upper end
of production guidance) and assuming commercial levels of
production are achieved at the end of Q3 2019.
Damang
Damang put in another solid performance during H1 2019,
beating plan on both production and costs, and is on track to
meet full year guidance of 218koz. The mine produced 112koz
during the first half (Q2 2019: 55koz) at AISC of US$652/oz
(Q2 2019: US$673/oz), based on the original WGC interpretation,
and AIC of US$1,061/oz (Q2 2019: US$1,097/oz).
Encouragingly, Damang generated free cash after all capital for
H1 2019.
At the end of the June 2019 quarter, and 30 months into the
Damang Reinvestment Project (DRP), total material mined
amounted to 103Mt, 19% ahead of the project schedule. Gold
produced during the same period was 436koz, 27% above the
DRP ounces of 344koz. The project capital spent to date is
US$320m versus the original DRP budget to-date of US$275m,
largely driven by the additional capital waste tonnes mined,
which has generated additional production and got the project
ahead of schedule.
Salares Norte
The focus at Salares Norte during H1 2019 was responding to
queries related to the Environmental Impact Assessment (EIA)
as well as progressing detailed engineering, which was at 33%
completed at the end of the period. We expect the EIA to be
granted within the next 12 months.
District exploration continued at Horizonte, a concession near
the proposed processing plant site, with further encouraging
results.
Regional performance in H1 2019
Australia
Gold production for the Australia region for the six months ended
June 2019 was 2% lower YoY at 435koz from 442koz in H1
2018, due to lower production at all operations. AISC (based on
the original WGC interpretation) and AIC for the region
(excluding Gruyere) increased by 26% YoY to A$1,465/oz
(US$1,035/oz) from A$1,166/oz (US$900/oz). The increase in
AIC during the period was mainly due to the net gold-in-process
movement at St Ives of US$42m (reflects the change from a
build-up in the previous year to a drawdown in the current year
of stockpiled ore) and the extraordinary one-off capital of
US$22m at Agnew that related to the construction of the new
accommodation village. The GIP build-up at St Ives in 2018
related to mining significantly more material in the open pits than
what could be processed (due to capacity and blending
constraints) and in line with the mining plan that was optimised
given that the Invincible open pit is nearing completion.
Based on the revised WGC interpretation guidance, AISC for the
Australia region was A$1,191/oz (US$841/oz) for H1 2019. The
region remains on track to meet cost and production guidance
provided in February 2019.
Net cash inflow from the region for the six months ended June
2019, excluding the US$65m spent on Gruyere, was US$92m
(compared with US$86m in H1 2018).
During the six months ended June 2019, A$44m of the
exploration budget was spent, with 190,512 metres drilled during
3
Gold Fields 2019 H1 RESULTS
the period. The Invincible complex at St Ives continues to grow
laterally and at depth and is expected to be a key ore source for
years to come. At Agnew, drilling at Waroonga North continued
to yield positive results with indications of being open laterally
and at depth. Similarly, Redeemer along with Barren Lands are
emerging as likely new ore sources for the future. Resource and
reserve delineation is underway and is expected to be completed
by the next declaration, early in 2020.
On the back of the increased prospectivity at Agnew, Gold Fields
has invested in two key projects at the mine:
·
The construction of a new accommodation village, which
was completed during H1 2019, at a total cost of A$40m
(US$28m) which is expected to be recouped within five years
through lower operating costs; and
·
Gold Fields and global energy group EDL announced a
A$112m investment in a world-leading energy microgrid
combining wind, solar, gas and battery storage. The
microgrid will be owned and operated by EDL, which will
recoup its investment via a 10-year electricity supply
agreement with Agnew. This will provide incremental power
supply beyond the base at a lower cost.
Granny Smith has materially increased resources (4x) and
reserves (3x) since acquisition. The mine is now operating at a
depth approaching 1.2 kilometres. As mining is getting deeper
there has been changing geotechnical conditions and risk as well
as increased haulage distances to surface. Mineral reserves
have been defined to Zone 135 level at a depth of approximately
1.4 kilometres and exploration has defined mineralisation
extending to a potential Zone 150 level at a depth of up to
1.9 kilometres. The mine has committed to an in-depth mining
method and haulage study which is expected to be completed
over the next 18 months, including a possible shaft haulage
option, to set up the mine for the longer term and realise the full
value potential of the existing and future mineral resources.
West Africa
Attributable gold production at the West African operations
(including Asanko), increased by 25% to 400koz in H1 2019 from
319koz in H1 2018 due to the inclusion of 55koz (45% basis)
from Asanko for the six months ended 30 June 2019 as well as
increased production at Tarkwa and Damang.
AISC (based on the original WGC interpretation) and AIC for the
region (including Asanko) decreased 10% YoY to US$1,007/oz
from US$1,114/oz due to higher gold sold, lower sustaining
capital and lower expenditure on the Damang reinvestment
project. Capex for the Damang reinvestment project was
US$46m for the six months ended June 2019, compared with
US$66m for the six months ended June 2018. The AISC for the
Ghana region (which excludes the project capex for Damang)
decreased 3% YoY to US$892/oz.
The region (excluding Asanko) generated net cash inflow of
US$72m for H1 2019 from an outflow of US$2m for the six
months to June 2018.
South America
Attributable equivalent gold production at Cerro Corona
increased 14% YoY to 156koz from 137koz in H1 2018 mainly
due to mining of higher grade areas, in line with the mining
sequence. AISC (based on the original WGC interpretation) and
AIC decreased by 5% YoY to US$698 per equivalent ounce from
US$737 per equivalent ounce in H1 2018, due to higher
equivalent ounces sold, partially offset by higher capital
expenditure and higher cost of sales before amortisation and
depreciation. Based on the revised WGC interpretation, AISC
was US$684/oz for H1 2019. The mine generated net cash flow
of US$52m, compared to US$41m for the six months ended
June 2018.
South Deep
After an expected slow start in Q1 2019 following the
restructuring at the end of 2018, South Deep continued to make
positive progress on most of the performance metrics during the
second quarter. Gold production increased by 67% to 1,782kg
(57koz) in the June quarter from 1,069kg (34koz) in the March
quarter and production performance was in line with
expectations, supporting production guidance for the year.
Destress mining increased by 63% to 6,310 square metres in the
June quarter from 3,881 square metres in the March quarter.
This improvement was due to enhanced operational
performance and an increase in the number of destress cuts
available. Longhole stoping increased by 34% to 137,500 tonnes
from 102,500 tonnes.
AISC (based on the original WGC interpretation) and AIC
decreased by 34% to R590,492/kg (US$1,275/oz) in the June
quarter from R900,408/kg (US$1,992/oz) in the March quarter,
mainly due to higher gold sold and lower sustaining capex.
Encouragingly, net cash flow for the quarter was a positive
R71m.
For the six months to 30 June 2019, production at South Deep
decreased by 5% YoY to 2,851kg (92koz) from 3,003kg (97koz)
for the six months ended June 2018. Underground reef yield
increased by 24% YoY to 6.5g/t mainly due to loading of
previously mined ore in higher grade areas which was
inaccessible due to ramp rehabilitation work and higher grade
ore mined from the proximal portion of the orebody (the proximal
section of the orebody is generally associated with higher in-situ
grade), in line with the geotechnical mining sequence.
As part of the restructuring in 2018, the mobile underground
production fleet was rationalised. The drill rig fleet was reduced
by 29% from 21 rigs to 15 rigs. Coupled with the reduced fleet
and in line with the productivity interventions introduced, the
average metres per rig (development and destress) have
increased by 49% YoY to 55 metres per rig per month for the six
months ending June 2019 from 37 metres per rig per month for
the six months ending June 2018. Similarly, there was a
significant increase in stoping tonnes per rig (long hole stoping
and benching) to 10,253 tonnes per rig per month in H1 2019
from 5,518 tonnes per rig per month in H1 2018.
AISC (based on the original WGC interpretation) and AIC for the
six months ended June 2019 decreased 2% YoY to R698,982/kg
(US$1,529/oz) (H1 2018: R715,373/kg or US$1,816/oz). Net
cash outflow for the six months ended 30 June 2019 was R238m
(US$17m) compared to an outflow of R656m (US$54m) in H1
2018.
The focus at South Deep remains on optimising the entire value
chain to open, mine and fill voids as efficiently as possible along
with enabling factors around fleet management, training and
coaching, all underpinned by a commitment to safety and health.
Successful debt refinancing
New bonds issued
On 9 May 2019 Gold Fields successfully concluded the raising
of two new bonds – a US$500m 5-year bond with a coupon of
5.125% and a US$500m 10-year bond with a coupon of 6.125%
– raising a total of US$1 billion at an average coupon of 5.625%.
The proceeds of the bond raising were used to repay amounts
outstanding under the US$1,290m Credit Facilities Agreement
Gold Fields 2019 H1 RESULTS
4
and to buyback US$250m of the outstanding 2020 notes at
102% of par.
US$1,200 million revolving credit facility
On 25 July 2019, Gold Fields Orogen Holding (BVI) Limited and
Gold Fields Ghana Holdings (BVI) Limited entered into a
US$1,200 million revolving credit facilities agreement, with a
syndicate of international banks and financial institutions. The
new facilities which became effective on the same day comprise
two tranches:
· US$600m 3+1+1 (upfront extension option subject to bank
consent) year revolving credit facility (RCF) – at a margin of
1.45% over Libor; and
· US$600m 5+1+1 (upfront extension option subject to bank
consent) year revolving credit facility (RCF) – at a margin of
1.70% over Libor.
Gold Fields was upgraded to Baa3 by Moody’s on 26 June 2018
and the new transaction allowed the Company to align the
documentation to Investment Grade terms and conditions. Gold
Fields has also adopted IFRS 16 and improved its financial
covenants to accommodate the treatment of operating leases as
follows:
· Net Debt to EBITDA covenant has moved from 2.5 times to
3.5 times; and
· Consolidated EBITDA to Consolidated Net Finance Charges
covenant has been reduced from 5 times to 4 times
The purpose of the new facilities is:
· to refinance the US$1,290m credit facilities agreement dated
6 June 2016;
· to repay the Gold Fields bonds maturing in 2020; and
· to fund general corporate and working capital requirements
of the Gold Fields group.
Sale of non-core assets
During H1 2019, in-line with its key strategic objective of paying
down its debt, Gold Fields sold its shareholdings in two of its non-
core investments, Maverix Metals and Red 5, for combined
proceeds of US$88m, which were used to retire debt. Both
positions were sold at a significant premium to the look-through
acquisition costs.
2019 outlook and guidance – unchanged
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 based on
the original WGC interpretation. 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$1,394/oz).
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.
Post H1 2019 events
Tarkwa-Damang road
On 9 July 2019, Gold Fields officially commissioned the
reconstructed 33km road in Ghana’s Western Region linking the
Tarkwa and Damang mines. The asphalt road, which cost
approximately GHS145m (US$27m) and has a life span of over
20 years, cuts travel times by more than half and reduces safety
risks significantly. It also serves several communities along the
road and is expected to ease transportation of people, goods and
services as well as boost economic activities. Ghanaian
contractors undertook the construction, with the Ghana Highway
Authority responsible for managing and maintaining the road. It
is the largest-ever public infrastructure project funded by Gold
Fields and a notable example of our philosophy of shared value
working in practice.
Silicosis settlement
On 26 July 2019, the Johannesburg High Court approved the
R5.2bn settlement of the silicosis and tuberculosis class action
suit between the Occupational Lung Disease Working Group –
representing Gold Fields, African Rainbow Minerals, Anglo
American SA, AngloGold Ashanti, Harmony and Sibanye
Stillwater – and lawyers representing affected mineworkers.
After a mandatory three-month period, during which potential
beneficiaries can opt out of the settlement agreement, the
settlement funds will be used to establish the Thiamiso Trust.
The trust will track and trace class members, process all
submitted claims, including the undertaking of benefit medical
examinations, and pay benefits to eligible claimants. Gold Fields
has provided R384m for its share of the settlement cost.
Asanko update
Asanko and Gold Fields have agreed to a way forward on a
revised life of mine plan. The updated Mineral Resources and
Reserves are expected to be released in Q1 2020 and will be
based on the following key assumptions:
· Mine plan based on the open pit mineral reserves at Esaase
and Nkran (reflecting Cut 2 with stripping now nearing
completion and a further Cut 3 pushback) as well as mineral
resources from satellite pits at Akwasiso, Adubiaso, Abore
and Asuadai;
· Production based on the existing processing plant and
infrastructure treating 5.4 million tonnes per annum of ore;
· Targeting a remaining life of mine of 8-10 years with gold
production of 225koz to 250koz per year;
· Ore will continue to be transported from the Esaase pit to the
processing facility via road trucks. The existing 27km haul
road will be upgraded as required to support higher haulage
rates in the future;
· Significant capital expenditure is expected to be limited to the
relocation of the Tetrem village (commencing in Q3 2019),
an upgrade to the Esaase ore haul road (anticipated in
2022), waste stripping of Nkran Cut 3 and ongoing Tailing
Storage Facility capital.
In addition, the JV partners are progressing an updated
exploration strategy over the entire land package.
Nick Holland
Chief Executive Officer
15 August 2019
STOCK DATA FOR THE 6 MONTHS ENDED 30 JUNE 2019
Number of shares in issue
NYSE – (GFI)
– at 30 June 2019
828,632,707
Range – Quarter
US$3.61 – US$5.57
– average for the six months
826,499,428
Average Volume – six months
6,495,354 shares/day
Free Float
100 per cent
JSE LIMITED – (GFI)
ADR Ratio
1:1
Range – Quarter
ZAR50.83 – ZAR84.11
Bloomberg/Reuters GFISJ/GFLJ.J
Average Volume – six months
2,626,012 shares/day
5
Gold Fields 2019 H1 RESULTS
Key Statistics
United States Dollars
Quarter
Six months ended
Figures in millions unless otherwise stated
June
2019
March
2019
June
2018
June
2019
June
2018
Gold produced*
oz (000)
541
542 504
1,083
994
Tonnes milled/treated
000
9,037
8,879 8,314
17,915
16,686
Revenue (excluding Asanko)
US$/oz
1,297
1,300 1,297
1,298
1,306
Cost of sales before gold inventory
change and amortisation and
depreciation (excluding Asanko)
US$/tonne
42
41 42
42
42
All-in sustaining costs
#
(original interpretation)
US$/oz
985
963 973
973
965
All-in sustaining costs (revised
interpretation guidance – WGC)
US$/oz
910
871 -
891 -
Total all-in cost
#
US$/oz
1,132
1,080 1,187
1,106
1,169
Net debt (pre IFRS 16)
US$m
1,498
1,614 1,393
1,498
1,393
Net debt to EBITDA ratio
(pre IFRS 16)
1.36
1.07
Net debt (IFRS 16 impact included)
US$m
1,794
1,913 -
1,794 -
Net debt to EBITDA ratio
(IFRS 16 impact included)
1.59 -
Cash flow from operating activities**
US$
49
(79)
Profit/(loss)
US$m
70.5
(366.6)
Profit/(loss)
US c.p.s.
9
(45)
Headline earnings
US$m
39.9
66.7
Headline earnings
US c.p.s.
5
8
Normalised profit US$m
126.2
42.8
Normalised profit
US c.p.s.
15
5
* 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 31 and 32.
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 2019 H1 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.
7
Gold Fields 2019 H1 RESULTS
Results for the Group
Safety
It is with deep sadness that we have to report that Maria Ramela,
an employee at South Deep, lost her life in a mining incident on
2 June 2019. The 38-year old trackless crew leader was fatally
injured after being struck by a rock ejected from the rockface
following a series of four seismic events in quick succession.
As a result the Group’s fatal injury frequency rate regressed from
0.00 for the six months ended 30 June 2018 to 0.04 for the six
months ended 30 June 2019. The total recordable injury frequency
rate (TRIFR) for the Group regressed by 3 per cent from 2.10 for
the six months ended 30 June 2018 to 2.17 for the six months
ended 30 June 2019. Three serious injuries were reported for the
six months ended 30 June 2019, compared with two serious injuries
for the six months ended 30 June 2018.
These incidents serve as a stark reminder that our focus on safety
has to be relentless. In this regard, in 2017 a Safety Leadership
Group was initiated by our Executive Committee, now chaired by
Stuart Mathews, Executive Vice President Australia. This group has
developed the following strategic objectives:
· Develop a culture of safety leadership within the organisation
and firmly embed safety management as a line management
responsibility;
· Provide appropriate mechanisms to engage employees on
safety and equip them with the necessary skills to achieve safe
outcomes consistently; and
· Ensure the deployment of fit for purpose management systems
that are aligned to a Critical Control Management approach and
are certified to the ISO 45001 standard.
A follow-up workshop was held during the second half of 2019
where a dedicated safety leadership training package in support of
these objectives will be launched. The training will be rolled out
across the organisation from the Board of Directors to operational
staff and will be standard for all new employees. We will also be
extending our Australian behaviour-based programme, Vital
Behaviours, to entrench safe behaviours and choices within every
activity across the entire business.
Six months
Year
Safety
H1
2019
H2
2018
H1
2018
2018
2017
Fatalities 1
1 0
1 3
Serious Injuries
3
15 2
17 26
TRIFR
1
2.17
1.52 2.10 1.83 2.42
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 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.
Environmental
No Level 3 – 5 environmental incidents were reported for the six
months ended 30 June 2019 compared with two for the six months
ended 30 June 2018.
On 7 June 2019, Gold Fields responded to a request from the
Church of England Pensions Board and the Swedish Council on
Ethics for information on mining companies’ tailings storage
facilities (TSFs). A report on Gold Fields’ 34 tailings facilities (of
which two are managed by joint ventures) was submitted to the
institutions and published on our website. Gold Fields manages the
safety of its TSFs through, amongst others, compliance with the
International Council on Mining and Metals’ (ICMM) Tailings
Governance Position Statement.
Fresh water withdrawal was 7.67 gigalitres for the six months ended
30 June 2019 compared with 8.12 gigalitres for the six months
ended 30 June 2018 mainly due to a decrease in water withdrawal
at Damang and Tarkwa as a result of increased recycling/reuse at
both operations. Water recycled/reused was 68 per cent of total
water usage for the six months ended 30 June 2019, above the
annual ICMM-recommended target of 60 per cent, compared with
61 per cent for the six months ended 30 June 2018.
Group energy spend was US$145 million (21 per cent of operating
costs) for the six months ended 30 June 2019 compared with
US$131 million (19 per cent of operating costs) for the six months
ended 30 June 2018, driven by higher global oil prices and rising
electricity tariffs – notably by 13 per cent for South Deep. Net
realised gains from the oil price hedges totalled US$4.3 million for
the six months ended 30 June 2019. For the six months ended
30 June 2019 energy savings of 223 terajoules were achieved
(43 per cent of the 2019 target of 523 terajoules).
CO
2
scope 1 and 2 emissions were 0.68 million tonnes for the six
months ended 30 June 2019 compared with 0.70 million tonnes for
the six months ended 30 June 2018, with CO
2
intensity
commensurately lower at 0.64 tonnes per ounce produced
compared with 0.68 tonnes per ounce for the six months ended
30 June 2018.
Installation of the underground pipelines to transport natural gas to
Damang and Tarkwa was completed during the quarter and first
gas was received by the mines’ power plants in June 2019. Piped
gas is inherently safer than road transportation of gas.
At the Granny Smith and Agnew mines in Australia, construction
has begun on microgrid power systems, which include a
combination of gas, solar renewable energy and battery storage.
Commissioning is expected in the September quarter 2019 for
Agnew and in the December quarter 2019 for Granny Smith (solar).
Agnew’s microgrid will be strengthened with the addition of five
wind turbines to be commissioned in 2020, funded by the Australian
government.
Gold Fields is the first JSE-listed mining company to support the
recommendations of the Task Force on Climate-related Financial
Disclosures (TCFD), and plans to submit its first TCFD baseline in
the September quarter 2019. The TCFD was established by the
Financial Stability Board at the request of the G20 Group of
Nations. The TCFD report will replace the annual submission on
climate change under the Carbon Disclosure Project (CDP).
Gold Fields 2019 H1 RESULTS
8
Six months
Year
Environmental
H1
2019
H2
2018
H1
2018
2018
2017
Environmental
Incidents Level 3
- 1 1
2 2
Water
Recycled/Reused
(% of total)
68
69 63
66 57
Fresh Water
Withdrawal (GL)
1
7.67
6.35
8.12
14.47
14.83
Energy Consumption
(TJ)
5,845
5,761
5,867
11,628
12,178
Energy Intensity
(GJ/ounce)
5.48
5.58
5.70
5.64
5.46
CO
2
Emissions
(million tonnes)
2
0.68
0.67
0.70
1.37
1.47
CO
2
Emissions
(tonnes/ounces)
0.64
0.65
0.68
0.66
0.66
¹ Relates to operations only.
² CO
2
emissions comprise Scope 1 and 2 emissions
3
.
³ Scope 1 emissions arise directly from sources managed by the Company. Scope 2 are
indirect emissions generated in the production of electricity used by the Company.
Social
Gold Fields continues to focus on maximising in-country and host
community economic impact. The Group’s value distribution to
national economies was US$1.26 billion for the six months ended
30 June 2019 compared with US$1.40 billion for the six months
ended 30 June 2018. Gold Fields procurement from in-country
suppliers, excluding corporate procurement spend, was
US$866 million for the six months ended 30 June 2019 (96 per cent
of total procurement).
Gold Fields aims to sustain the value delivered to host communities
through employment, procurement and social investments. Group
host community employment was 9,563 employees – 57 per cent
of the workforce for the six months ended 30 June 2019 (Year end
2018: 9,188 host community employees, or 56 per cent of
workforce). Group host community procurement spend for the six
months ended 30 June 2019 was US$311 million – 35 per cent of
total spend compared with 22 per cent spend for the six months
ended 30 June 2018. The increase was mainly due to a widening
of the host community definition at South Deep.
Gold Fields invested US$13.1 million in socio-economic
development (SED) projects in our host communities for the six
months ended 30 June 2019, compared with US$10.1 million for
the six months ended 30 June 2018. The investments are funded
through Gold Fields’ foundations, trusts and operations. In July,
after three years of construction, the 33 kilometre tarred Tarkwa-
Damang road was opened. At US$27 million this is Gold Fields’
largest-ever SED project.
The Board approved a Sexual Harassment Policy and a Group
Diversity and Inclusion strategy in 2019. The percentage of women
in Gold Fields’ workforce was 20 per cent at the end of H1 2019,
compared with 19 per cent at end-2018. Of the 20 per cent, just
over half work in core mining activities. Training spend for the six
months ended 30 June 2019 was US$7.8 million compared with
US$14 million for FY 2018.
Six months
Year
Social
H1
2019
H2
2018
H1
2018
2018
2017
Host Community
procurement
(% of total)
35
1
27
22
27
2
45
Host Community
workforce
(% of total)
57
1
56
43
56
40
Socio-Economic
Development
Spending ($m)
13.1
15.6
10.1
25.7
17.4
Women in Workforce
(%)
20
19
19
19
16
¹ Includes Gruyere.
² 2018 performance is aligned with the Group's host community definition where
communities are those living within an operation's direct area of influence. 2017 number
has not been restated.
For the six months ended 30 June 2019
compared with the six months ended
30 June 2018
Revenue
Attributable equivalent gold production, (including Asanko)
increased by 9 per cent from 994,000 ounces for the six months
ended 30 June 2018 to 1,082,500 ounces for the six months ended
30 June 2019. Attributable equivalent gold production at Asanko
for the six months ended 30 June 2019 was 55,100 ounces.
Revenue from Asanko is not included in Group revenue as Asanko
results are equity accounted.
Gold production at South Deep in South Africa, decreased by 5 per
cent from 3,003 kilograms (96,500 ounces) for the six months
ended for the six months ended 30 June 2018 to 2,851 kilograms
(91,700 ounces) for the six months ended 30 June 2019.
Attributable gold production at the West African operations
(including Asanko), increased by 25 per cent from 318,500 ounces
for the six months ended 30 June 2018 to 399,500 ounces for the
six months ended 30 June 2019 due to increased production at
Tarkwa and Damang, as well as the inclusion of 55,100 ounces
(45 per cent basis) from Asanko for the six months ended 30 June
2019. Production at Asanko (not included in revenue) amounted to
55,100 ounces (45 per cent basis) for the six months ended
30 June 2019 compared to no ounces included for Asanko for the six
months ended 30 June 2018. Asanko was acquired by Gold Fields
in H2 of 2018.
Attributable equivalent gold production at Cerro Corona in Peru
increased by 14 per cent from 136,900 ounces for the six months
ended 30 June 2018 to 156,400 ounces for the six months ended
30 June 2019.
Gold production at the Australian operations decreased by 2 per
cent from 442,400 ounces for the six months ended 30 June 2018
to 434,900 ounces for the six months ended 30 June 2019 mainly
due to lower production at all the Australian operations.
At the South Africa region, production at South Deep decreased by
5 per cent from 3,003 kilograms (96,500 ounces) for the six months
ended 30 June 2018 to 2,851 kilograms (91,700 ounces) for the six
months ended 30 June 2019 the decrease was due to a slow
production build-up period experienced post the restructuring to
reorganise operations in the December quarter 2018. Gold sold
decreased by 13 per cent from 3,240 kilograms (104,200 ounces)
to 2,804 kilograms (90,100 ounces).
9
Gold Fields 2019 H1 RESULTS
At the West Africa region, managed gold production at Tarkwa
increased by 2 per cent from 264,400 ounces for the six months
ended 30 June 2018 to 270,900 ounces for the six months ended
30 June 2019 mainly due to higher head grade and recovery. At
Damang, managed gold production increased by 25 per cent from
89,500 ounces for the six months ended 30 June 2018 to 111,800
ounces for the six months ended 30 June 2019 mainly due to higher
head grade and higher volumes processed. Gold produced and
gold sold are the same for both Tarkwa and Damang. Production
at Asanko amounted to 55,100 ounces (45 per cent basis) for the
six months ended 30 June 2019 compared to no ounces included
for Asanko for the six months ended 30 June 2018. Asanko was
acquired by Gold Fields in H2 of 2018.
At the South America region, total managed gold equivalent
production at Cerro Corona increased by 14 per cent from 137,600
ounces for the six months ended 30 June 2018 to 157,100 ounces
for the six months ended 30 June 2019 mainly due to mining of
higher grade areas in line with the mining sequence. Gold
equivalent ounces sold increased by 19 per cent from 131,700
ounces to 156,400 ounces.
At the Australia region, St Ives’ gold production decreased by 1 per
cent from 189,800 ounces for the six months ended 30 June 2018
to 187,600 ounces for the six months ended 30 June 2019. Gold
sold decreased by 4 per cent from 190,200 ounces to 183,200
ounces. At Agnew, gold production decreased by 2 per cent from
115,400 ounces for the six months ended 30 June 2018 to 113,300
ounces for the six months ended 30 June 2019. Gold sold
decreased by 1 per cent from 116,900 ounces to 115,400 ounces.
At Granny Smith, gold production decreased by 2 per cent from
137,200 ounces for the six months ended 30 June 2018 to 134,000
ounces for the six months ended 30 June 2019 due to decreased
tonnes mined and processed. Gold sold decreased by 2 per cent
from 137,300 ounces to 133,900 ounces.
The average US dollar gold price achieved by the Group (excluding
Asanko) decreased by 1 per cent from US$1,306 per equivalent
ounce for the six months ended 30 June 2018 to US$1,298 per
equivalent ounce for the six months ended 30 June 2019. The
average rand gold price increased by 16 per cent from R518,504
per kilogram to R600,601 per kilogram. The average Australian
dollar gold price increased by 8 per cent from A$1,707 per ounce
to A$1,843 per ounce. The average US dollar gold price for the
Ghanaian operations (excluding Asanko) decreased by 1 per cent
from US$1,318 per ounce for the six months ended 30 June 2018
to US$1,304 per ounce for the six months ended 30 June 2019.
The average equivalent US dollar gold price, net of treatment and
refining charges, for Cerro Corona increased by 3 per cent from
US$1,228 per equivalent ounce for the six months ended 30 June
2018 to US$1,268 per equivalent ounce for the six months ended
30 June 2019. The average US dollar/Rand exchange rate
weakened by 16 per cent from R12.25 for the six months ended
30 June 2018 to R14.22 for the six months ended 30 June 2019.
The average Australian/US dollar exchange rate weakened by
8 per cent from A$1.00 = US$0.77 to A$1.00 = US$0.71.
Gold equivalent ounces sold (excluding Asanko), increased by
3 per cent from 1.03 million ounces to 1.06 million ounces.
Revenue increased by 2 per cent from US$1,351 million for the six
months ended 30 June 2018 to US$1,379 million for the six months
ended 30 June 2019 due to the higher gold sold, partially offset by
lower gold price.
Cost of sales before amortisation and depreciation
Cost of sales before amortisation and depreciation increased by
1 per cent from US$688 million for the six months ended 30 June
2018 to US$695 million for the six months ended 30 June 2019.
At the South Africa region, at South Deep, cost of sales before
amortisation and depreciation decreased by 11 per cent from
R1,882 million (US$154 million) for the six months ended 30 June
2018 to R1,669 million (US$117 million) for the six months ended
30 June 2019 due to lower production and lower payroll costs due
to restructuring in 2018, lower expenditure on consumables and a
gold inventory credit of R17 million (US$1 million) for the six months
ended 30 June 2019 compared with a charge of R36 million
(US$3 million) for the six months ended 30 June 2018.
At the West Africa region, (excluding Asanko), cost of sales before
amortisation and depreciation increased by 1 per cent from US$213
million for the six months ended 30 June 2018 to US$216 million
for the six months ended 30 June 2019 mainly due to higher
operational tonnes mined, partially offset by a higher gold-in-
process credit of US$13 million compared with gold-in-process
charge of US$11 million for the six months ended 30 June 2018 at
Tarkwa. The net gold-in-process movement at Tarkwa was
US$24 million.
At the South America region, at Cerro Corona, cost of sales before
amortisation and depreciation increased by 4 per cent from
US$78 million for the six months ended 30 June 2018 to US$81
million for the six months ended 30 June 2019 due to higher workers
participation in line with higher revenue and profit.
At the Australia region, cost of sales before amortisation and
depreciation increased by 26 per cent from A$316 million (US$244
million) for the six months ended 30 June 2018 to A$397 million
(US$280 million) for the six months ended 30 June 2019 mainly due
to a higher gold inventory charge to cost at St Ives of A$20 million
(US$14 million) for the six months ended 30 June 2019 compared
with a credit to cost of A$36 million (US$28 million) for the six
months ended 30 June 2018, resulting in a net movement of A$56
million (US$42 million).
Amortisation and depreciation
Amortisation and depreciation for the Group decreased by 16 per
cent from US$347 million for the six months ended 30 June 2018
to US$292 million for the six months ended 30 June 2019. The
US$55 million decrease in amortisation was due to lower
amortisation of US$39 million in local currencies and the exchange
rate effect of US$16 million on translation into US dollars at a 16
per cent weaker rand and an 8 per cent weaker Australian dollar.
The lower amortisation in local currencies mainly related to a
decrease at St Ives of A$52 million (US$44 million) due to higher
ounces mined in the six months ended 30 June 2018 compared
with the six months ended 30 June 2019.
Other
Net interest expense for the Group decreased by 6 per cent from
US$33 million for the six months ended 30 June 2018 to
US$31 million for the six months ended 30 June 2019. Interest
expense of US$51 million, partially offset by interest income of
US$3 million and interest capitalised of US$17 million for the six months
ended 30 June 2019 compared with interest expense of US$44 million,
partially offset by interest income of US$4 million and interest
capitalised of US$7 million for the six months ended 30 June 2018.
The share of results of equity accounted investees after taxation
decreased from US$6 million for the six months ended 30 June
2018 to US$1 million for the six months ended 30 June 2019 due
to sundry asset write-offs at Far Southeast project (FSE) for the six
months ended June 2018. The impact of the equity accounted
earnings of Asanko for the six months ended 30 June 2019 was
US$nil million due to Asanko breaking even for the six months
ended 30 June 2019.
Gold Fields 2019 H1 RESULTS
10
The gain on foreign exchange of US$3 million for the six months
ended 30 June 2018 compared with US$nil million for the six
months ended 30 June 2019 and related to the conversion of
offshore cash holdings into their functional currencies.
The loss on financial instruments of US$109 million for the six
months ended 30 June 2019 comprises a loss on hedges of
US$114 million and a gain on valuation of shares and options of
US$5 million. The loss on hedges of US$114 million includes
realised gains/losses and the mark to market of the gold hedges
taken out at the Australian operations (a loss of A$137 million
/US$97 million), the Ghanaian operations (a loss of US$8 million)
and South Deep (a loss of R132 million/US$10 million), the
oil hedges taken out at the Ghanaian and Australian operations (a
gain of US$3 million and A$4 million/US$3 million, respectively) and
the currency hedge taken out at the Australian operations (loss of
A$7 million/US$5 million). The loss on the hedges included in
financial instruments comprised US$6 million realised losses and
US$108 million unrealised losses.
The gain on valuation of shares and options of US$5 million
comprises a gain of US$2 million on the valuation of the Maverix
options and US$3 million on the valuation of the Maverix shares
prior to their disposal.
This compared with a gain on financial instruments of US$24 million
for the six months ended 30 June 2018, which included realised
gains/losses and the mark to market of the gold hedges taken out
at the Australian operations (a gain of A$1 million/US$1 million), the
Ghanaian operations (a gain of US$10 million) and South Deep (a
loss of US$1 million/R14 million), the oil hedges taken out at the
Ghanaian and Australian operations (a gain of US$7 million and
A$5 million/US$4 million, respectively), as well as the copper hedge
taken out at Cerro Corona (gain of US$4 million). In addition, a
currency hedge taken out at the Australian operations resulted in a
loss of US$1 million (A$1 million).
Share-based payments for the Group decreased from US$20
million to US$11 million and related to the current valuation of the
share scheme. The long-term incentive plan increased from
US$1 million to US$6 million due to the current valuation of the plan.
Other costs for the Group increased from US$30 million to
US$36 million and mainly related to increased community spend
in Peru.
Exploration expenses
Exploration expenses decreased by 21 per cent from US$56 million
for the six months ended 30 June 2018 to US$44 million for the six
months ended 30 June 2019 mainly due to decreased costs at
Salares Norte as we await the EIA approval on the project.
Non-recurring items
Non-recurring income of US$19 million for the six months ended 30
June 2019 compared with expenses of US$661 million for the six
months ended 30 June 2018.
Non-recurring income of US$19 million for the six months ended 30
June 2019 mainly includes:
· profit on sale of Maverix holding of US$15 million;
· reversal of impairment of FSE of US$10 million; and
· loss on the repurchase of 2020 bond of US$5 million.
Non-recurring expenses of US$661 million for the six months ended
30 June 2018 mainly included:
· impairment of R6.471 billion (US$482 million). The after tax
impairment is R4.819 billion (US$359 million) in respect of the
South Deep cash-generating unit. The impairment calculation
is based on the 2018 life of mine plan using the following
assumptions:
o
Gold price of R525,000 per kilogram;
o
Resource price of US$17 per ounce at a Rand/Dollar
exchange rate of R13.44;
o
Resource ounces of 29.0 million ounces;
o
Life of mine: 77 years; and
o
Discount rate: 13.5 per cent nominal.
The impairment is due to a deferral of production. The
underperformance of the mine in 2018 and the resultant knock-
on impact has necessitated a further impairment of South
Deep. For the purpose of the impairment calculation, we have
used a number equivalent to extrapolating the six months
ended 30 June 2018 production for 2019 of 6,100 kilogram (196
kilogram per ounce). The carrying value after impairment is
R20.7 billion (US$1.5 billion). The information underlying the
impairment calculation may be subject to further adjustments in
the future. These adjustments could be as a result of further
information becoming available to management during Gold
Fields’ production planning processes.
· restructuring costs at Tarkwa (US$81 million) with the transition
to contractor mining;
· restructuring costs at Damang (US$15 million);
· restructuring costs at South Deep (US$4 million/R53 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; and
· impairment of FSE amounted to US$20 million and other losses
on the sale of assets amounted to US$16 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.
Royalties
Government royalties for the Group increased by 3 per cent from
US$33 million for the six months ended 30 June 2018 to
US$34 million for the six months ended 30 June 2019 in line with
higher revenue.
Taxation
The taxation charge for the Group of US$62 million for the six
months ended 30 June 2019 compared with a credit of US$129
million for the six months ended 30 June 2018. Normal taxation
increased by 12 per cent from US$74 million for the six months
ended 30 June 2018 to US$83 million for the six months ended 30
June 2019. The deferred tax credit of US$21 million for the six
months ended 30 June 2019 compared with US$201 million for the
six months ended 30 June 2018. The significant deferred tax credit
for the six months ended 30 June 2018, arose due to the taxation
credit of R1.652 billion (US$123 million) on the impairment of South
Deep, as well as the settlement of the South Deep tax dispute with
SARS. GFIJVH has recognised an additional R2,338 million
(US$191 million) of capital allowance with a tax effect on this
amount of R701 million (US$57 million).
Profit/(loss)
Net profit attributable to owners of the parent for the Group of
US$71 million or US$0.09 per share for the six months ended 30
June 2019 compared with net loss of US$367 million or US$0.45
per share for the six months ended 30 June 2018.
Headline earnings attributable to owners of the parent for the Group
of US$40 million or US$0.05 per share for the six months ended 30
June 2019 compared with headline earnings of US$67 million or
US$0.08 per share for the six months ended 30 June 2018.
Normalised profit for the Group of US$126 million or US$0.15 per
share for the six months ended 30 June 2019 compared with
US$43 million or US$0.05 per share for the six months ended 30
June 2018.
11
Gold Fields 2019 H1 RESULTS
Normalised profit
Normalised profit reconciliation for the Group is calculated as
follows:
Six months ended
June
2019
June
2018
Profit/(loss) for the period
70.5
(366.6)
Non-recurring items
(19.0)
661.2
Tax effect of non-recurring items
(0.1)
(166.6)
Non-controlling interest effect of non-recurring
items -
(9.7)
Loss/(gain) on foreign exchange
0.1
(2.8)
Tax effect of loss/(gain) on foreign exchange
-
0.1
Loss/(gain) on financial instruments
109.4
(23.9)
Tax effect of loss/(gain) on financial
instruments
(34.2)
7.2
Non-controlling interest effect of loss/(gain) on
financial instruments
(0.5)
1.1
South Deep tax settlement -
(57.2)
Profit excluding gains and losses on foreign
exchange, financial instruments and non-
recurring items after taxation and non-
controlling interest effect
126.2
42.8
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.
Cash flow
Cash inflow from operating activities of US$426 million for the six
months ended 30 June 2019 compared with US$263 million for the
six months ended 30 June 2018. The increase of 62 per cent was
mainly due to an increase in the line item “profit before royalties, tax
and non-recurring items”. In addition, royalties and taxation paid
decreased from US$169 million to US$99 million. This was partially
offset by an investment into working capital of US$25 million
compared with a release of working capital of US$6 million in 2018.
Dividends paid of US$12 million for the six months ended 30 June
2019 compared with US$35 million for the six months ended 30
June 2018 and comprised dividends paid to owners of the parent
related to the final dividends paid for 2017 and 2018, respectively.
Cash outflow from investing activities of US$277 million for the six
months ended 30 June 2019 compared with US$320 million for the
six months ended 30 June 2018. Capital expenditure decreased
from US$411 million to US$356 million.
Sustaining capital expenditure (excluding Asanko), decreased by 3
per cent from US$254 million to US$246 million, while non-
sustaining capital expenditure (excluding Asanko) decreased by 29
per cent from US$157 million to US$111 million. At South Deep,
growth expenditure decreased from R149 million (US$12 million) to
Rnil million (US$nil million). Growth expenditure on the
reinvestment plan at Damang decreased from US$66 million to
US$46 million and at Gruyere it decreased from US$66 million
(A$86 million) to US$65 million (A$92 million), respectively.
Cash inflow from operating activities less net capital expenditure,
environmental payments and finance lease payments of US$49
million for the six months ended 30 June 2019 compared with an
outflow US$79 million for the six months ended 30 June 2018
mainly due to lower taxation paid, higher inflow from operating
activities and lower capital expenditure as planned.
In the South Africa region at South Deep, capital expenditure
decreased by 34 per cent from R379 million (US$31 million) for the
six months ended 30 June 2018 to R250 million (US$18 million) for
the six months ended 30 June 2019 due to temporary suspension
of new mine development in 2019.
At the West Africa region, (excluding Asanko), capital expenditure
decreased by 24 per cent from US$156 million to US$118 million.
At Tarkwa, capital expenditure decreased by 19 per cent from
US$84 million to US$68 million due to lower capital waste stripping
in line with the operational plan. Capital expenditure at Damang
decreased by 32 per cent from US$73 million to US$50 million and
included US$46 million spent on the Damang re-investment project
for the six months ended 30 June 2019. Capital expenditure at
Asanko on a 100 per cent basis amounted to US$36 million for the
six months ended 30 June 2019 and US$nil million for the six
months ended 30 June 2018 (prior to acquisition). The Asanko
capital expenditure is not included in the Group capital expenditure.
At the South America region at Cerro Corona, capital expenditure
increased by 60 per cent from US$10 million to US$16 million
mainly due to the beginning of the infrastructure reallocation
activities related to the extension of the life of mine to 2030.
At the Australia region, capital expenditure increased by 12 per cent
from A$174 million (US$134 million) for the six months ended 30
June 2018 to A$195 million (US$138 million) for the six months
ended 30 June 2019. At St Ives, capital expenditure decreased by
3 per cent from A$74 million (US$57 million) to A$72 million (US$51
million). At Agnew, capital expenditure increased by 70 per cent
from A$46 million (US$35 million) to A$78 million (US$55 million)
due to expenditure on the new accommodation village. At Granny
Smith, capital expenditure decreased by 15 per cent from A$54
million (US$42 million) for the six months ended 30 June 2018 to
A$46 million (US$33 million) for the six months ended 30 June 2019
due to a reduction in capital development and exploration cost.
Proceeds on disposal of capital equipment of US$1 million for the
six months ended 30 June 2019 compared with US$77 million for
the six months ended 30 June 2018. The proceeds in 2018 related
to Tarkwa’s sale of fleet to the contractor as part of the conversion
to contractor mining.
Purchase of investments of US$6 million for the six months ended
30 June 2019 related to Gold Fields subscription to a 16.1 per cent
share interest in Chakana Copper Corporation. This compared with
purchase of investments of US$18 million related to Gold Fields
subscription to a 9.9 per cent share interest in Asanko Gold by way
of a private placement of 22,354,657 Asanko shares for the six
months ended 30 June 2018.
Proceeds on the sale of Maverix amounted to US$67 million for the
six months ended 30 June 2019 and related to the sale of the
Group’s 19.9 per cent holding in Toronto-listed gold and royalty
streaming company Maverix.
Proceeds on disposal of assets held for sale for the six months
ended 30 June 2018 comprised US$40 million cash and royalty (2
per cent NSR (net smelter return)) on all metals and related to the
disposal of APP.
Proceeds on disposal of investments for the six months ended 30
June 2019 amounted to US$21 million and related to the sale of
247 million shares (19.9 per cent holding) in ASX-listed Company
Red 5.
Environmental payments decreased from US$8 million for the six
months ended 30 June 2018 to US$4 million for the six months
ended 30 June 2019.
The US$49 million cash flow from operating activities less net
capital expenditure and environmental payments and finance lease
Gold Fields 2019 H1 RESULTS
12
payments for the six months ended 30 June 2019 comprised:
US$198 million net cash generated by the seven mining operations
(after royalties, taxes, capital expenditure and environmental
payments), less US$39 million of net interest paid, US$37 million at
Salares Norte on exploration, US$65 million (A$92 million) at
Gruyere with US$65 million (A$92 million) on capital expenditure
and US$nil million (A$nil million) on working capital, as well as
US$8 million on non-mine based costs mainly due to working
capital movements. Included in the US$198 million above is US$46
million capital expenditure on the Damang reinvestment project.
The US$79 million outflow from operating activities less net capital
expenditure and environmental payments and finance lease
payments for the six months ended 30 June 2018 comprised:
US$71 million net cash generated by the seven mining operations
(after royalties, taxes, capital expenditure and environmental
payments), less US$18 million of net interest paid, US$35 million at
Salares Norte on exploration, US$79 million (A$103 million) at
Gruyere with US$66 million (A$86 million) on capital expenditure
and US$13 million (A$17 million) on working capital, as well as
US$18 million on non-mine based costs mainly due to working
capital movements. Included in the US$71 million above is US$66
million capital expenditure on the Damang reinvestment project and
US$12 million on South Deep growth capital expenditure.
Net cash flow from financing activities of US$nil million for the six
months ended 30 June 2019 compared with US$115 million for the
six months ended 30 June 2018. The inflow for the six months
ended 30 June 2019 related to a drawdown of US$1,521 million,
partially offset by the repayment of US$1,503 million on offshore
and local loans and payment of finance lease liabilities of US$17
million. The inflow for the six months ended 30 June 2018 related
to a drawdown of US$358 million, partially offset by the repayment
of US$243 million on offshore and local loans.
The net cash inflow for the Group of US$137 million for the six
months ended 30 June 2019 compared with an inflow of US$24
million for the six months ended 30 June 2018. After accounting for
a negative translation adjustment of US$2 million on non-US dollar
cash balances, the cash inflow for the six months ended 30 June
2019 was US$135 million. The cash balance at 30 June 2019 of
US$535 million compared with US$498 million at 30 June 2018.
All-in sustaining and total all-in cost
The Group all-in sustaining costs increased by 1 per cent from
US$965 per ounce for the six months ended 30 June 2018 to
US$973 per ounce for the six months ended 30 June 2019 mainly
due to higher sustaining capital expenditure and higher cost of
sales before amortisation and depreciation partially offset by higher
gold sold.
On 14 November 2018 the World Gold Council published an update
to its guidance note on the interpretation of all-in sustaining and all-
in costs. The note provided additional clarity on what constitutes
growth capital expenditure. Gold Fields has considered the new
guidance note to ensure the interpretation of the guidelines is
consistent with the additional guidance now available and has
adopted it prospectively from 1 January 2019. Based on the
revised World Gold Council interpretation guidance, all-in
sustaining costs for the Group are US$891 per ounce for the six
months ended 30 June 2019. One of the benefits of adopting the
new standard is closer alignment of our cost reporting with existing
practices in our sector.
All-in sustaining cost revised reconciliation
US$/oz
Total Group
AISC per ounce of gold sold
(original WGC interpretation)
Year to date
2019 973
Development and infrastructure capital
reclassified from sustaining to non-
sustaining
#
Year to date
2019 (58)
Exploration expenditure reclassified from
sustaining to non-sustaining
Year to date
2019 (24)
AISC per ounce of gold sold
(revised WGC interpretation)
Year to date
2019 891
#
Comprising mainly Agnew accommodation village, Granny Smith Zone 110 and 120
lateral development and infrastructure and St Ives Invincible South development and
infrastructure.
Total all-in cost decreased by 5 per cent from US$1,169 per ounce
for the six months ended 30 June 2018 to US$1,106 per ounce for
the six months ended 30 June 2019 due to higher gold sold, lower
non-sustaining capital expenditure and lower exploration costs,
partially offset by higher cost of sales before amortisation and
depreciation and higher sustaining capital expenditure.
In the South Africa region, at South Deep, all-in sustaining costs
increased by 4 per cent from R669,306 per kilogram (US$1,699 per
ounce) for the six months ended 30 June 2018 to R698,982 per
kilogram (US$1,529 per ounce) for the six months ended 30 June
2019 mainly due to lower gold sold, partially offset by lower cost of
sales before amortisation and depreciation and lower sustaining
capital expenditure.
Based on the revised World Gold Council interpretation guidance,
all-in sustaining costs for the South Africa region are R698,982 per
kilogram (US$1,529 per ounce) for the six months ended 30 June
2019 i.e. no change.
Total all-in cost decreased by 2 per cent from R715,373 per
kilogram (US$1,816 per ounce) for the six months ended 30 June
2018 to R698,982 per kilogram (US$1,529 per ounce) due to the
same reasons as for all-in sustaining costs as well as nil spend on
non-sustaining capital expenditure for the six months ended 30
June 2019.
At the West Africa region, all-in sustaining costs decreased by 3 per
cent from US$924 per ounce for the six months ended 30 June
2018 to US$892 per ounce for the six months ended 30 June 2019
mainly due to higher gold sold and lower sustaining capital
expenditure, partially offset by higher cost of sales before
amortisation and depreciation. Asanko all-in sustaining costs at
US$1,155 per ounce is included for the six months ended 30 June
2019.
Based on the revised World Gold Council interpretation guidance,
all-in sustaining costs for the West Africa region are US$892 per
ounce for the six months ended 30 June 2019. Total all-in cost
decreased by 10 per cent from US$1,114 per ounce for the six
months ended 30 June 2018 to US$1,007 per ounce for the six
months ended 30 June 2019 due to the same reasons as for all-in
sustaining costs, as well as lower non-sustaining capital
expenditure at the Damang reinvestment project.
At the South America region, all-in sustaining costs and total all-in
cost increased by 47 per cent from US$197 per ounce for the six
months ended 30 June 2018 to US$290 per ounce for the six
months ended 30 June 2019 mainly due to higher capital
expenditure and higher cost of sales before amortisation and
depreciation, partially offset by higher gold sold. All-in sustaining
costs and total all-in cost per equivalent ounce decreased by 5 per
cent from US$737 per equivalent ounce for the six months ended
30 June 2018 to US$698 per equivalent ounce for the six months
ended 30 June 2019 due to higher equivalent ounces sold, partially
offset by higher capital expenditure and higher cost of sales before
amortisation and depreciation.
13
Gold Fields 2019 H1 RESULTS
Based on the revised World Gold Council interpretation guidance,
all-in sustaining costs for the South America region are US$264 per
ounce and US$684 per equivalent ounce for the six months ended
30 June 2019.
At the Australia region excluding the Gruyere project, all-in
sustaining costs and total all-in costs increased by 26 per cent from
A$1,166 per ounce (US$900 per ounce) for the six months ended
30 June 2018 to A$1,465 per ounce (US$1,035 per ounce) for the
six months ended 30 June 2019 mainly due to lower gold sold,
higher cost of sales before amortisation and depreciation due to a
gold-in-process charge to cost of A$22 million (US$16 million) for
the six months ended 30 June 2019 compared with a gold-in-
process credit to cost of A$31 million (US$24 million) for the six
months ended 30 June 2018 and higher capital expenditure mainly
relating to A$31 million (US$22 million) on the Agnew
accommodation village.
Based on the revised World Gold Council interpretation guidance,
all-in sustaining costs for the Australia region are A$1,191 per
ounce (US$841 per ounce) for the six months ended 30 June 2019.
Statement of financial position
Net debt (borrowings plus the current portion of borrowings and
finance lease liabilities less cash and cash equivalents) increased
from US$1,612 million for the six months ended 31 December 2018
to US$1,794 million for the six months ended 30 June 2019.
Net debt excluding the effect of IFRS 16 is US$1,498 million at 30
June 2019 compared with US$1,393 million at 30 June 2018.
The difference between the two methods of calculating net debt is
the long and short term portion of lease liabilities identified as part
of IFRS 16, comprising mainly the Genser power purchase
agreement, Granny Smith power plant and Gruyere power plant
and gas pipeline.
Net debt/EBITDA
The net debt/EBITDA ratio of 1.59 at 30 June 2019 compared with
1.07 at 30 June 2018. The ratio above includes the effect of
adoption of IFRS 16 which marginally increased cost of sales
before amortisation and depreciation and substantially increased
the net debt due to the inclusion of lease liabilities.
The net debt/EBITDA ratio (excluding the effect of IFRS 16) of 1.36
at 30 June 2019 compared with 1.07 at 30 June 2018.
EBITDA
Adjusted EBITDA for calculating net debt/EBITDA is based on the
previous 12 months profit and takes into account the adoption of
IFRS 16, which is determined as follows in US$ million:
Reconciliation between operating profit and adjusted
EBITDA for the 6 months ended:
US$’m
June
2019
June
2018
Revenue
1,379
1,351
Cost of sales before amortisation and
depreciation
(695)
(688)
Environmental rehabilitation interest
6
6
Exploration and project costs
(44)
(56)
Other costs
(33)
(7)
613
606
Reconciliation between operating profit and adjusted
EBITDA for the 12 months ended:
US$’m
June
2019
June
2018
Adjusted EBITDA for 6 months
January to June
613
606
Adjusted EBITDA for 6 months
July to December
517
701
Adjusted EBITDA for 12 months
July to June
1,130
1,307
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.
Adjusted EBITDA excluding the effect of IFRS 16 is US$1,104
million for the 12 months ended 30 June 2019.
The difference between the two methods of calculating adjusted
EBITDA is a net reduction in operating costs relating to contracts
identified as leases under IFRS 16.
Free cash flow margin
The free cash flow (FCF) margin is revenue less cash outflow
divided by revenue expressed as a percentage.
The FCF for the Group for the six months ended 30 June 2019 is
calculated as follows:
US$’m
US$/oz
Revenue*
1,291.4
1,309
Less: Cash outflow
(1,010.9)
(1,025)
AIC
(1,084.5)
(1,099)
Adjusted for:
Share-based payments (non-cash)
11.2
11
Long-term incentive plan (non-cash)
5.8
6
Revenue hedge
(10.7)
(11)
Exploration, feasibility and evaluation
costs outside of existing operations
22.8
23
Non-sustaining capital expenditure
(Damang reinvestment and Gruyere)
110.6
112
Tax paid (excluding royalties which is
included in AIC above)
(66.1)
(67)
Free cash flow**
280.5
284
FCF margin
22%
Gold sold only – 000’ounces
986.6
* Revenue from income statement at US$1,378.5 million less revenue from by-products
in AIC at US$87.1 million equals US$1,291.4 million.
** Free cash flow does not agree with cash flows from operating activities less capital
expenditure in the statement of cash flows on page 27 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.
The FCF margin of 22 per cent for the six months ended 30 June
2019 at a gold price of US$1,298 per ounce compared with 17 per
cent for the six months ended 30 June 2018 at a gold price of
US$1,306 per ounce.
The higher FCF margin for the six months ended 30 June 2019 was
mainly due to higher revenue and lower tax paid.
South Africa region
South Deep
Six months ended
June
2019
June
2018
Gold produced
000’oz
91.7
96.5
kg
2,851
3,003
Gold Fields 2019 H1 RESULTS
14
Gold sold
000’oz
90.1
104.2
kg
2,804
3,240
Yield – underground reef
g/t
6.50
5.24
AISC – original interpretation
R/kg
698,982
669,306
US$/oz
1,529
1,699
AISC – revised interpretation
guidance (WGC November
2018) R/kg
698,982
US$/oz
1,529
AIC R/kg
698,982
715,373
US$/oz
1,529
1,816
Regrettably, a seismic related face ejection resulted in fatally
injuring Mrs. Maria Ramela on 2 June 2019. In conjunction with the
DMR, the Mine is conducting investigations into the accident in
order to implement measures to mitigate the impact of similar
events reoccurring. Face support (mesh) has been implemented as
an immediate mitigation measure.
The mine finalised the restructuring in the December quarter 2018,
this entailed suspending operations in lower grade and high cost
areas and reducing the total number of mining equipment deployed
as reported previously. A planned production build-up period was
followed post the restructuring to re-organise operations, therefore
total volume mined was expected to reduce, impacting most of the
mining measures.
Gold production decreased by 5 per cent from 3,003 kilograms
(96,500 ounces) for the six months ended 30 June 2018 to 2,851
kilograms (91,700 ounces) for the six months ended 30 June 2019.
Total underground tonnes mined decreased by 25 per cent from
639,000 tonnes for the six months ended 30 June 2018 to 482,000
tonnes for the six months ended 30 June 2019. The average reef
grade mined increased by 1 per cent from 6.18 grams per tonne to
6.27 grams per tonne due to greater portion of mining in the higher
grade proximal areas and suspending mining activities in the lower
grade loss making northern portions of current mine as part of the
restructuring project.
Total tonnes milled decreased by 33 per cent from 0.80 million
tonnes to 0.54 million tonnes, mainly due to less tonnes mined as
a result of the reasons above. Underground reef tonnes milled
decreased by 23 per cent from 0.57 million tonnes for the six
months ended 30 June 2018 to 0.44 million tonnes for the six
months ended 30 June 2019. Total tonnes milled for the six months
ended 30 June 2019 included 43,900 tonnes of underground waste
mined and 61,000 tonnes of surface tailings material compared with
92,000 tonnes of underground waste mined and 139,000 tonnes of
surface tailings material for the six months ended 30 June 2018.
Total waste mined reduced as a result of suspending growth capital
and associated waste development together with low grade areas
in the northern portion of the current mine area, as part of the
restructuring, which included proportionally more waste
development. The treatment of surface tailing material was halted
in the June quarter 2019 to increase underground backfill
availability, by sending TSF material directly to the backfill plant and
bypassing the treatment plant. In addition, the suspension of
surface treatment was required to facilitate modifications to the
processing plant, which will enable separating treatment of surface
tailings and underground ore, this will increase the mine’s capacity
to treat surface tailings material and thereby increasing the capacity
to manufacture backfill. Underground reef yield increased by 24
per cent from 5.24 grams per tonne for the six months ended 30
June 2018 to 6.50 grams per tonne for the six months ended 30
June 2019. Reef yield improved in the six months ended 30 June
2019 due to a higher mine call factor in the higher grade proximal
areas mined.
Development decreased by 33 per cent from 3,406 metres for the
six months ended 30 June 2018 to 2,272 metres for the six months
ended 30 June 2019. New mine capital development (NMD)
(phase one, sub 95 level) decreased by 100 per cent from 828
metres to nil metres due to suspending growth capital development
and re-allocation of resources to secondary support and backfill, in
line with the restructuring strategy. Development in the current
mine areas in 95 level and above decreased by 57 per cent from
1,670 metres to 719 metres, resulting from mining resources being
allocated to develop the North of Wrench mine and suspension of
mining activities in the northern portions of current mine.
Consequently, reef horizon development North of Wrench
increased by 71 per cent from 908 metres to 1,553 metres.
Longhole stoping volume mined increased by 2 per cent from
236,000 tonnes for the six months ended 30 June 2018 to 240,000
tonnes for the six months ended 30 June 2019 mainly due to
improved backfill and secondary support performance, improving
stope availability and turnaround.
Destress mining decreased by 22 per cent from 13,114 square
metres for the six months ended 30 June 2018 to 10,191 square
metres for the six months ended 30 June 2019 mainly due to
reduced number of active cuts in the March quarter 2019,
production build-up post the restructuring and inclusion of shotcrete
in the support requirements, which increases the mining cycle.
The current mine contributed 9 per cent less ore tonnes at 49 per
cent of total tonnes for the six months ended 30 June 2019. The
decrease in current mine tonnes is also due to the cessation of
mining in low grade areas as part of the restructuring. North of
Wrench increased by 9 per cent and contributed 51 per cent of total
ore tonnes mined for the six months ended June 2019 in line with
the strategy to build up North of Wrench.
Cost of sales before amortisation and depreciation, decreased by
11 per cent from R1,882 million (US$154 million) for the six months
ended 30 June 2018 to R1,669 million (US$117 million) for the six
months ended 30 June 2019. The decrease was mainly due to
lower production, lower expenditure on consumable and payroll
costs and by a gold inventory credit of R17 million (US$1 million)
for the six months ended 30 June 2019 compared with a charge of
R36 million (US$3 million) for the six months ended 30 June 2018.
The net gold-in-process credit movement was R53 million (US$4
million).
Capital expenditure decreased by 34 per cent from R379 million
(US$31 million) for the six months ended 30 June 2018 to R250
million (US$18 million) for the six months ended 30 June 2019, as
explained below.
Sustaining capital expenditure increased by 9 per cent from R230
million (US$19 million) for the six months ended 30 June 2018 to
R250 million (US$18 million) for the six months ended 30 June
2019 mainly due to higher expenditure on surface infrastructure for
the plant. Non-sustaining capital expenditure decreased by 100 per
cent from R149 million (US$12 million) to nil million. This decrease
was mainly due to the temporary suspension of growth capital in
2019.
All-in sustaining costs increased by 4 per cent from R669,306 per
kilogram (US$1,699 per ounce) for the six months ended 30 June
2018 ) to R698,982 per kilogram (US$1,529 per ounce) for the six
months ended 30 June 2019 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 decreased by 2 per cent from R715,373 per
kilogram (US$1,816 per ounce) for the six months ended 30 June
2018 to R698,982 per kilogram (US$1,529 per ounce) for the six
15
Gold Fields 2019 H1 RESULTS
months ended 30 June 2019 due to the same reasons as for all-in-
sustaining costs as well as a decrease in non-sustaining capital
expenditure to Rnil million (US$nil million).
In September 2018, the support standard was changed which
resulted in a 63 per cent increase in the number of bolts that need
to be installed in the development and destress areas, which
resulted in a 70 per cent increase in support cost when comparing
the six months ended 30 June 2019 and six months ended 30 June
2018. The support cost includes the contractors cost associated
with the installation of support material.
The implementation of shotcreting in the development and destress
areas was also implemented in the latter part of 2018, which
resulted in further increases on support cost when comparing the
six months ended 30 June 2019 and six months ended 30 June
2018. In December 2018, the contractor crews working on NMD
were deployed to the backlog support and backfill activities to
reduce backlog and improve stope turnover. This resulted in
additional expenditure when comparing the six months ended 30
June 2019 and the six months ended 30 June 2018. The enhanced
support protocol should be beneficial in the medium to long term by
reducing relatively expensive rehabilitation.
The restructuring process initiated during 2018 was aimed at
improving operational efficiency. Even though production output
reduced from the previous period, resources deployed was reduced
in a larger ratio, improving the unit cost and profitability of the
operation. The build-up period, in the March quarter 2019, post the
restructuring and related industrial action masked this effect to
some extent.
West Africa region
Ghana
Tarkwa
Six months ended
June
2019
June
2018
Gold produced
000’oz
270.9
264.4
Gold sold
000’oz
270.9
264.4
Yield g/t
1.22
1.19
AISC – original interpretation
US$/oz
940
954
AISC – revised interpretation
guidance (WGC November
2018) US$/oz
940 -
AIC US$/oz
940
954
Gold production increased by 2 per cent from 264,400 ounces for
the six months ended 30 June 2018 to 270,900 ounces for the six
months ended 30 June 2019 mainly due to higher yield in line with
the plan.
Total tonnes mined, including capital stripping, increased by 7 per
cent from 45.2 million tonnes for the six months ended 30 June
2018 to 48.5 million tonnes for the six months ended 30 June 2019
due to improved contractor fleet performance. Ore tonnes mined
increased by 19 per cent from 6.7 million tonnes to 8.0 million
tonnes. Operational waste tonnes mined increased by 91 per cent
from 10.8 million tonnes to 20.6 million tonnes due to higher
operational waste stripping required to expose ore in line with the
2019 plan. Capital waste tonnes mined decreased by 28 per cent
from 27.7 million tonnes to 19.9 million tonnes in line with the 2019
plan. Grade mined decreased by 3 per cent from 1.29 grams per
tonne to 1.24 grams per tonne in line with the 2019 plan. The strip
ratio decreased from 5.7 to 5.1.
The CIL plant throughput increased marginally from 6.88 million
tonnes for the six months ended 30 June 2018 to 6.89 million
tonnes for the six months ended 30 June 2019. Realised yield from
the CIL plant increased by 3 per cent from 1.19 grams per tonne to
1.22 grams per tonne due to higher grade ore fed from mining and
stockpiles and improved plant recovery which increased from 96.6
per cent to 97.3 per cent.
Cost of sales before amortisation and depreciation, increased by 5
per cent from US$150 million for the six months ended 30 June
2018 to US$157 million for the six months ended 30 June 2019 as
a result of higher operational tonnes mined, partially offset by a
higher gold-in-process credit. The six months ended 30 June 2019
resulted in a US$13 million build-up of stockpiles compared with a
drawdown of US$11 million for the six months ended 30 June 2018.
At the end of June 2019, 5.6 million tonnes at 0.90 grams per tonne
remained on the ROM stockpile and 6.0 million tonnes at 0.64
grams per tonne on the low grade stockpile. At the end of June
2018, 4.8 million tonnes at 0.86 grams per tonne remained on the
ROM stockpile and 4.3 million at 0.64 grams per tonne on the low-
grade stockpile.
Capital expenditure decreased by 19 per cent from US$84 million
to US$68 million mainly due to lower capital waste stripping and
increased operational waste mined.
All-in sustaining costs and total all-in cost decreased by 1 per cent
from US$954 per ounce for the six months ended 30 June 2018 to
US$940 per ounce for the six months ended 30 June 2019 due to
higher gold sold and lower capital expenditure, partially offset by
higher cost of sales before amortisation and depreciation.
Damang
Six months ended
June
2019
June
2018
Gold produced
000’oz
111.8
89.5
Gold sold
000’oz
111.8
89.5
Yield g/t
1.50
1.29
AISC – original interpretation
US$/oz
652
829
AISC – revised interpretation
guidance (WGC November
2018) US$/oz
652 -
AIC US$/oz
1,061
1,585
Gold production increased by 25 per cent from 89,500 ounces for
the six months ended 30 June 2018 to 111,800 ounces for the six
months ended 30 June 2019 mainly due to higher head grade and
higher volumes processed.
Total tonnes mined, including capital stripping, decreased by 28 per
cent from 23.9 million tonnes for the six months ended 30 June
2018 to 17.1 million tonnes for the six months ended 30 June 2019
in line with the 2019 operational plan as the Amoanda pit comes to
completion.
Ore tonnes mined increased by 50 per cent from 1.8 million tonnes
to 2.7 million tonnes. Operational waste tonnes mined decreased
by 21 per cent from 3.4 million tonnes to 2.7 million tonnes as a
result of the Amoanda pit getting deeper with its associated
operational constraints. Total capital waste tonnes decreased by
37 per cent from 18.7 million tonnes to 11.7 million tonnes. Capital
waste of 11.7 million tonnes was mined at the Damang DPCB
complex for the six months ended 30 June 2019. This compared
with 4.4 million tonnes mined at the Amoanda pit and 14.3 million
tonnes at the Damang complex for the six months ended 30 June
2018, comprising 12.4 million tonnes from DPCB and 1.9 million
tonnes from the Saddle area.
Head grade mined decreased by 12 per cent from 1.79 grams per
tonne to 1.58 grams per tonne due to lower grade ore mined from
Saddle pit. The strip ratio decreased from 12.7 to 5.4 in line with
the 2019 operational plan.
Gold Fields 2019 H1 RESULTS
16
Tonnes processed increased by 7 per cent from 2.16 million tonnes
for the six months ended 30 June 2018 to 2.32 million tonnes for
the six months ended 30 June 2019 as a result of higher plant
overall equipment effectiveness and optimisation work carried out
at the crushing circuit. Yield increased by 16 per cent from 1.29
grams per tonne to 1.50 grams per tonne due to higher mined grade
material treated from Amoanda pit. For the six months ended 30
June 2019, tonnes milled were sourced as follow: 1.92 million
tonnes at 1.66 grams per tonne from the pits, 0.40 million tonnes at
1.78 grams per tonne from stockpiles. This compared with 1.52
million tonnes at 1.75 grams per tonne from the pits, 0.64 million
tonnes at 0.63 grams per tonne from stockpiles for the six months
ended 30 June 2018. The increase in yield notwithstanding the
lower head grade mined is due to the processing of higher grade
stockpiles previously mined at Amoanda pit.
Cost of sales before amortisation and depreciation, decreased by 6
per cent from US$63 million to US$59 million due to a gold-in-
process credit to cost of US$7 million for the six months ended 30
June 2019, compared with US$5 million for the six months ended
30 June 2018, as well as lower cost.
Capital expenditure decreased by 32 per cent from US$73 million
to US$50 million, with US$45 million spent on capital waste
stripping.
Sustaining capital expenditure decreased by 43 per cent from US$7
million to US$4 million due to the expenditure incurred on the SAG
mill shell replacement in the six months ended 30 June 2018. Non-
sustaining capital expenditure decreased by 30 per cent from
US$66 million to US$46 million mainly due to lower capital waste
tonnes mined.
All-in sustaining costs decreased by 21 per cent from US$829 per
ounce for the six months ended 30 June 2018 to US$652 per ounce
for the six months ended 30 June 2019 due to higher gold sold,
lower cost of sales before amortisation and depreciation and lower
sustaining capital.
All-in costs decreased by 33 per cent from US$1,585 per ounce for
the six months ended 30 June 2018 to US$1,061 per ounce for the
six months ended 30 June 2019 due to the same reasons above,
as well as lower non-sustaining capital expenditure.
At the end of the June 2019 quarter, and 30 months into the
Damang Reinvestment Project (DRP), total material mined
amounted to 103 million tonnes, 19 per cent ahead of the project
schedule. Gold produced during the same period was 436,185
ounces, 27 per cent above the DRP ounces of 344,332. The project
capital spent to date is US$320 million versus the original DRP
budget to date of US$275 million, largely driven by the additional
capital waste tonnes mined.
Asanko (Equity accounted Joint Venture)
June
2019
Gold produced
000’oz
122.5
Gold sold
000’oz
119.8
Yield g/t
1.47
AISC – original interpretation
US$/oz
1,155
AISC – revised interpretation guidance
(WGC November 2018)
US$/oz
1,155
AIC US$/oz
1,235
All figures in table 100 per cent basis
.
Gold production was 122,500 ounces for the six months ended 30
June 2019. The following statistics are also shown for the six
months ended 30 June 2019.
Total tonnes mined were 16.9 million tonnes. Ore tonnes mined
were 2.6 million tonnes. Head grade mined was 1.48 grams per
tonne.
Total waste tonnes mined were 14.3 million tonnes. The strip ratio
was 5.6.
The plant throughput was 2.6 million tonnes. Yield was 1.47 grams
per tonne.
Cost of sales before amortisation and depreciation was US$94
million.
Total capital expenditure was US$36 million.
Sustaining capital expenditure was US$28 million and included
deferred stripping of US$23 million. Non-sustaining capital
expenditure was US$8 million and related to the Esaase business
readiness and Tetrem relocation.
Gold Fields’ 45 per cent share of gold produced and gold sold
amounted to 55,100 ounces and 53,900 ounces for the six months
ended 30 June 2019, respectively. Gold Fields’ share of cost of
sales before amortisation and depreciation was US$42 million for
the six months ended 30 June 2019. Gold Fields’ share of
sustaining capital expenditure was US$13 million for the six months
ended 30 June 2019. Gold Fields’ share in non-sustaining capital
expenditure for the six months ended 30 June 2019 was US$3
million.
All-in sustaining costs and total all-in cost of US$1,155 per ounce
and US$1,235 per ounce for the six months ended 30 June 2019.
South America region
Peru
Cerro Corona
Six months ended
June
2019
June
2018
Gold produced
000’oz
80.8
60.8
Copper produced
tonnes
16,122
14,678
Total equivalent gold produced
000’eq oz
157.1
137.6
Total equivalent gold sold
000’eq oz
156.4
131.7
Yield
– gold
g/t
0.78
0.59
– copper
per
cent
0.50
0.46
– combined
eq g/t
1.46
1.29
AISC – original interpretation
US$/oz
290
197
17
Gold Fields 2019 H1 RESULTS
AISC
US$/eq oz
698
737
AISC – revised interpretation
guidance (WGC November
2018) US$/oz
264
–
US$/eq oz
684
–
AIC US$/oz
290
197
AIC
US$/eq oz
698
737
Gold price*
US$/oz
1,301
1,321
Copper price*
US$/t
6,165
6,929
*
Average daily spot price for the period used to calculate total equivalent gold ounces
produced.
Gold production increased by 33 per cent from 60,800 ounces for
the six months ended 30 June 2018 to 80,800 ounces for the six
months ended 30 June 2019. Copper production increased by 10
per cent from 14,678 tonnes to 16,122 tonnes. Gold and copper
production increased mainly due to mining of higher grade areas in
line with the mining sequence. Equivalent gold production
increased by 14 per cent from 137,600 ounces to 157,100 ounces.
Gold head grade increased from 0.85 grams per tonne to 1.18
grams per tonne and copper head grade increased from 0.52 per
cent to 0.56 per cent. Gold recoveries decreased from 69.5 per
cent to 66.5 per cent. Copper recoveries increased from 87.6 per
cent to 89.3 per cent mainly due to higher head grade processed.
As a result of the above, gold yield increased from 0.59 grams per
tonne to 0.78 grams per tonne and copper yield increased from 0.46
per cent to 0.50 per cent.
For the six months ended 30 June 2019, concentrate with a payable
content of 81,313 ounces of gold was sold at an average price of
US$1,294 per ounce and 15,869 tonnes of copper was sold at an
average price of US$5,444 per tonne, net of treatment and refining
charges. This compared with 56,567 ounces of gold that was sold
at an average price of US$1,310 per ounce and 14,181 tonnes of
copper that was sold at an average price of US$6,217 per tonne,
net of treatment and refining charges, for the six months ended 30
June 2018. Total equivalent gold sales increased by 19 per cent
from 131,700 ounces for the six months ended 30 June 2018 to
156,400 ounces for the six months ended 30 June 2019 mainly due
to higher gold sold resulting from higher gold production as
explained above.
Total tonnes mined decreased by 2 per cent from 11.09 million
tonnes for the six months ended 30 June 2018 to 10.82 million
tonnes for the six months ended 30 June 2019 in line with the mine
sequencing. Ore mined increased by 12 per cent from 3.29 million
tonnes to 3.68 million tonnes. Waste tonnes mined decreased by
8 per cent from 7.80 million tonnes to 7.14 million tonnes mainly
due to the new mine sequence resulting from the extension of the
life of mine to 2030. The strip ratio decreased from 2.37 to 1.94 as
a result of additional ore mined.
Ore processed increased by 1 per cent from 3.33 million tonnes for
the six months ended 30 June 2018 to 3.35 million tonnes for the
six months ended 30 June 2019 mainly due to higher plant
throughput (820 tonnes per hour for the six months ended 30 June
2019 versus 799 tonnes per hour for the six months ended 30 June
2018) resulting from initiatives implemented in drilling and blasting
activities to reduce the impact of ore hardness.
Cost of sales before amortisation and depreciation, increased by 4
per cent from US$78 million for the six months ended 30 June 2018
to US$81 million for the six months ended 30 June 2019. The
higher cost was mainly due to higher workers participation resulting
from higher revenues and profit for the six months ended 30 June
2019.
Capital expenditure increased by 60 per cent from US$10 million to
US$16 million mainly due to increased expenditure on the TSF
construction as well as the commencement of the infrastructure
relocation activities related to the expansion of the life of mine until
2030. This included relocation of roads, mine offices and the
explosive storage facility.
All-in sustaining costs and total all-in cost increased by 47 per cent
from US$197 per ounce for the six months ended 30 June 2018 to
US$290 per ounce for the six months ended 30 June 2019. This
was mainly due to higher capital expenditure and higher cost of
sales before amortisation and depreciation, partially offset by higher
gold sold.
All-in sustaining costs and total all-in costs per equivalent ounce
decreased by 5 per cent from US$737 per equivalent ounce to
US$698 per equivalent ounce due to higher equivalent ounces sold,
partially offset by higher capital expenditure and higher cost of sales
before amortisation and depreciation.
Australia region
St Ives
Six months ended
June
2019
June
2018
Gold produced
000’oz
187.6
189.8
Gold sold
000’oz
183.2
190.2
Yield
– underground
g/t
3.91
4.16
– surface
g/t
1.99
2.61
– combined
g/t
2.59
2.82
AISC – original interpretation
A$/oz
1,427
988
US$/oz
1,008
763
AISC – revised interpretation
guidance (WGC November
2018) A$/oz
1,217
–
US$/oz
859
–
AIC A$/oz
1,427
988
US$/oz
1,008
763
Gold production decreased by 1 per cent from 189,800 ounces for
the six months ended 30 June 2018 to 187,600 ounces for the six
months ended 30 June 2019.
Total tonnes mined decreased by 39 per cent from 13.3 million
tonnes for the six months ended 30 June 2018 to 8.1 million tonnes
for the six months ended 30 June 2019 as ore tonnes mined have
been brought into line with mill capacity and strip ratios have
reduced.
At the underground operations, ore mined increased by 110 per
cent from 0.31 million tonnes for the six months ended 30 June
2018 to 0.65 million tonnes for the six months ended 30 June 2019.
At the Invincible underground mine ore production increased from
0.13 million tonnes to 0.48 million tonnes, following steady state
production levels reached by mid-2018. Ore production from
Hamlet underground mine decreased from 0.19 million tonnes to
0.04 million tonnes, with the mine reaching the end of its life. The
remainder of underground ore was sourced from remnant mining at
Cave Rocks. Total underground grade mined decreased by 11 per
cent from 4.53 grams per tonne to 4.05 grams per tonne mainly due
to the grade of ore mined from Invincible underground being lower
than the grade of ore mined at Hamlet during the six months ended
June 2018.
Operational waste tonnes mined from the underground operations
decreased by 22 per cent from 0.23 million tonnes for the six
months ended 30 June 2018 to 0.18 million tonnes for the six
months ended 30 June 2019. Capital waste tonnes mined
increased by 1,300 per cent from 0.02 million tonnes to 0.28 million
tonnes. The decrease in operational waste and increase in capital
waste reflect the increased mining activity at Invincible underground
mine.
Gold Fields 2019 H1 RESULTS
18
At the open pit operations, total ore tonnes mined decreased by 33
per cent from 2.56 million tonnes for the six months ended 30 June
2018 to 1.72 million tonnes for the six months ended 30 June 2019.
Ore tonnes mined from Invincible pit decreased by 54 per cent from
1.54 million tonnes to 0.71 million tonnes. Ore tonnes mined from
Neptune pit remained similar at 1.01 million tonnes for the six
months ended 30 June 2019. Grade mined decreased by 41 per
cent from 2.90 grams per tonne to 1.70 grams per tonne due to the
mining of higher grade areas in the Neptune pit during the six
months ended 30 June 2018 and the conclusion of high grade
mining from the Invincible pit during 2018.
Operational waste tonnes mined from the open pit operations
decreased by 55 per cent from 4.25 million tonnes for the six
months ended 30 June 2018 to 1.90 million tonnes for the six
months ended 30 June 2019. Capital waste tonnes mined
decreased by 43 per cent from 6.0 million tonnes to 3.4 million
tonnes. The strip ratio decreased from 4.0 to 3.1. Total open pit
material movement decreased by 45 per cent from 12.8 million
tonnes for the six months ended 30 June 2018 to 7.0 million tonnes
for the six months ended 30 June 2019, with the Invincible pit
becoming deeper and subsequently having a smaller area to mine
and mining operations at Neptune pit scaled down to reduce ore
tonnes mined to mill capacity.
At the consolidated St Ives mine, ounces mined decreased by 37
per cent from 283,500 ounces for the six months ended 30 June
2018 to 177,600 ounces for the six months ended 30 June 2019.
Underground gold mined increased by 84 per cent from 45,600
ounces for the six months ended 30 June 2018 to 84,000 ounces
for the six months ended 30 June 2019. Open pit gold mined
decreased by 61 per cent from 237,900 ounces for the six months
ended 30 June 2018 to 93,600 ounces for the six months ended 30
June 2019, reflecting reduced ore tonnes mined at lower grades.
By 30 June 2019, Neptune high-grade oxide material stockpiled
amounted to 26,300 ounces (663,000 tonnes at 1.23 grams per
tonne), Invincible amounted to 13,500 ounces (191,900 tonnes at
2.91 grams per tonne) and A5 amounted to 7,900 ounces (174,000
tonnes at 1.46 grams per tonne). This compared with the 30 June
2018, Neptune high-grade oxide material stockpiled amounted to
77,600 ounces (1,142,000 tonnes at 2.34 grams per tonne),
Invincible amounted to 44,500 ounces (375,000 tonnes at 2.81
grams per tonne) and A5 amounted to 7,900 ounces (174,000
tonnes at 1.46 grams per tonne).
Throughput at the Lefroy mill increased by 8 per cent from 2.09
million tonnes for the six months ended 30 June 2018 to 2.25 million
tonnes for the six months ended 30 June 2019. Yield decreased
by 8 per cent from 2.82 grams per tonne to 2.59 grams per tonne
due to the lower grade ore mined and processed.
Cost of sales before amortisation and depreciation, increased by 70
per cent from A$102 million (US$78 million) for the six months
ended 30 June 2018 to A$173 million (US$122 million) for the six
months ended 30 June 2019. The higher cost of sales before
amortisation and depreciation was mainly due to increased
underground mining costs associated with the ramp-up of ore
production at Invincible underground of A$16 million (US$11
million) and a gold inventory charge of A$20 million (US$14 million)
for the six months ended 30 June 2019 compared with a gold
inventory credit of A$36 million (US$28 million) for the six months
ended 30 June 2018. The net gold-in-process movement was A$56
million (US$42 million). The gold inventory movement reflects the
change from a build-up in 2018 to a drawdown of ore stockpiles in
2019.
Capital expenditure decreased by 3 per cent from A$74 million
(US$57 million) for the six months ended 30 June 2018 to A$72
million (US$51 million) for the six months ended 30 June 2019.
All-in cost increased by 44 per cent from A$988 per ounce (US$763
per ounce) for the six months ended 30 June 2018 to A$1,427 per
ounce (US$1,008 per ounce) for the six months ended 30 June
2019 mainly due to higher cost of sales before amortisation and
depreciation and lower gold sold, partially offset by lower capital
expenditure.
Agnew
Six months ended
June
2019
June
2018
Gold produced
000’oz
113.3
115.4
Gold sold
000’oz
115.4
116.9
Yield
g/t
6.02
6.11
AISC – original interpretation
A$/oz
1,753
1,393
US$/oz
1,238
1,075
AISC – revised interpretation
guidance (WGC November
2018) A$/oz
1,337
–
US$/oz
944
–
AIC A$/oz
1,753
1,393
US$/oz
1,238
1,075
Gold production decreased by 2 per cent from 115,400 ounces for
the six months ended 30 June 2018 to 113,300 ounces for the six
months ended 30 June 2019.
Ore mined from underground decreased by 4 per cent from 616,600
tonnes for the six months ended 30 June 2018 to 590,700 tonnes
for the six months ended 30 June 2019 with reduced production
from the New Holland mine. Head grade mined decreased by 1 per
cent from 6.26 grams per tonne to 6.21 grams per tonne. In the six
months ended 30 June 2019 117,900 ounces were mined and
sourced as follows: 82,500 ounces from Waroonga (328,300
tonnes at 7.8 grams per tonne) and 35,400 ounces from New
Holland (262,400 tonnes at 4.2 grams per tonne). This compared
with 124,000 ounces mined and sourced as follows: 87,400 ounces
from Waroonga (315,000 tonnes at 8.6 grams per tonne) and
36,600 ounces from New Holland (301,000 tonnes at 3.8 grams per
tonne) in the six months ended 30 June 2018.
Operational waste tonnes mined from the underground operations
decreased by 17 per cent from 0.12 million tonnes for the six
months ended 30 June 2018 to 0.10 million tonnes for the six
months ended 30 June 2019. Capital waste tonnes mined
increased by 11 per cent from 0.27 million tonnes to 0.30 million
tonnes.
Tonnes processed decreased marginally from 587,800 tonnes for
the six months ended 30 June 2018 to 585,600 tonnes for the six
months ended 30 June 2019. The combined yield decreased by 1
per cent from 6.11 grams per tonne to 6.02 grams per tonne in line
with the decrease in head grade mined for the six months ended 30
June 2019.
Cost of sales before amortisation and depreciation, increased by 5
per cent from A$110 million (US$85 million) for the six months
ended 30 June 2018 to A$116 million (US$82 million) for the six
months ended 30 June 2019 mainly due to increased mining cost
at Waroonga, associated with mining at deeper levels in the mine.
The gold-in-process charge to cost of A$3 million (US$2 million) for
the six months ended 30 June 2019 compared with a charge to cost
of A$5 million (US$4 million) for the six months ended 30 June
2018.
19
Gold Fields 2019 H1 RESULTS
Capital expenditure increased by 70 per cent from A$46 million
(US$35 million) for the six months ended 30 June 2018 to A$78
million (US$55 million) for the six months ended 30 June 2019.
Capital expenditure was higher due to A$32 million (US$22 million)
expenditure on a new accommodation village in the six months
ended June 2019. In total A$40 million (US$28 million) has been
spent on the construction of the village and will result in an annual
estimated cost saving of A$10 million (US$7 million). The village
will also reduce commuting time for the Agnew workforce by 40
minutes per day.
All-in cost increased by 26 per cent from A$1,393 per ounce
(US$1,075 per ounce) for the six months ended 30 June 2018 to
A$1,753 per ounce (US$1,238 per ounce) for the six months ended
30 June 2019 due to higher cost of sales before amortisation
depreciation and higher expenditure on the constructing the Agnew
accommodation village.
Granny Smith
Six months ended
June
2019
June
2018
Gold produced
000’oz
134.0
137.2
Gold sold
000’oz
133.9
137.3
Yield
g/t
5.10
5.11
AISC – original interpretation
A$/oz
1,268
1,219
US$/oz
895
942
AISC – revised interpretation
guidance (WGC November
2018) A$/oz
1,029
–
US$/oz
727
–
AIC A$/oz
1,268
1,219
US$/oz
895
942
Gold production decreased by 2 per cent from 137,200 ounces for
the six months ended 30 June 2018 to 134,000 ounces for the six
months ended 30 June 2019 due to decreased tonnes mined and
processed.
Ore mined from underground decreased by 1 per cent from 832,300
tonnes to 824,000 tonnes. Head grade mined decreased
marginally from 5.47 grams per tonne for the six months ended
June 2018 to 5.45 grams per tonne for the six months ended June
2019. Gold mined decreased by 1 per cent from 146,300 ounces
for the six months ended 30 June 2018 to 144,500 ounces for the
six months ended 30 June 2019.
Operational waste tonnes mined from the underground operations
increased by 100 per cent from 0.03 million tonnes for the six
months ended 30 June 2018 to 0.06 million tonnes for the six
months ended 30 June 2019. Capital waste tonnes mined
decreased by 14 per cent from 0.28 million tonnes to 0.24 million
tonnes.
Tonnes processed decreased by 2 per cent from 835,700 tonnes
for the six months ended 30 June 2018 to 818,000 tonnes for the
six months ended 30 June 2019 due to the reduction in ore mined
and timing of the campaign milling in the respective periods. Yield
for the six months ended June 2019 at 5.10 grams per tonne
compared to yield of 5.11 grams per tonne for the six months ended
June 2018.
Cost of sales before amortisation and depreciation, increased by 3
per cent from A$105 million (US$81 million) to A$108 million
(US$76 million) due to increased ore development cost of A$3
million (US$2 million) associated with accessing stopes in the lower
levels of the Wallaby mine. Mining cost will remain at a higher level,
with increased material being sourced from Z110 and Z120, the
deepest parts of the mine. The higher cost is associated with longer
haul and travel distances, increased percentage of ground support
requirements and increased tonnes of paste backfill. A gold
inventory credit of A$1 million (US$1 million) for the six months
ended 30 June 2019 compared with a charge of A$nil million
(US$nil million) for the six months ended 30 June 2018.
Capital expenditure decreased by 15 per cent from A$54 million
(US$42 million) for the six months ended 30 June 2018 to A$46
million (US$33 million) for the six months ended 30 June 2019. The
decrease in capital expenditure was primarily due to a reduction in
capital development cost of A$4 million (US$3 million) and a
reduction in exploration costs of A$2 million (US$2 million).
All-in cost increased by 4 per cent from A$1,219 per ounce
(US$942 per ounce) for the six months ended 30 June 2018 to
A$1,268 per ounce (US$895 per ounce) for the six months ended
30 June 2019 mainly due to higher cost of sales before amortisation
and depreciation and lower gold sold, partially offset by lower
capital expenditure.
Gruyere
First gold was poured over the weekend of 29 and 30 June 2019.
The gold was produced from the carbon-in-leach (CIL) and elution
circuits.
With the delivery of first gold, the focus then turned to
commissioning of the final components of the process plant,
particularly the gravity gold circuit and ball mill, which were
completed in July 2019. During the initial stages of ramp up, lower
grade stockpiled ore is being processed to reduce gold losses
associated with lower recoveries anticipated as the plant operations
are stabilised.
Commencement of the operation of the ball mill marked the start of
an anticipated ramp up period of six to seven months. Gruyere is
expected to attain commercial production mid way through the
ramp up period.
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.
Mining activity has delivered 2.5 million tonnes of ore mined
year-to-date and is ahead of plan. Ore delivery comprised 1.3
million tonnes of ore at a grade of 1.04 grams per tonne for
43,000 ounces, and a further 1.2 million tonnes of low grade at
0.61 grams per tonne for 22,000 ounces
(100 per cent basis).
Corporate
New bonds issued – US$1 billion raised
On 9 May 2019 Gold Fields successfully concluded the raising of
two new bonds – a US$500 million 5-year bond with a coupon of
5.125 per cent and a US$500 million 10-year bond with a coupon
of 6.125 per cent – raising a total of US$1 billion at an average
coupon of 5.625 per cent. The final combined book for the bond
issues was in excess of US$3 billion, an oversubscription by three
times.
The proceeds of the raising were used to repay amounts
outstanding under the US$1,290 million Credit Facilities Agreement
and repurchase of a portion of the 2020 bond.
Gold Fields 2019 H1 RESULTS
20
In conjunction with the issuance, and as part of the use of proceeds,
Gold Fields announced a tender offer for up to US$250 million of
the outstanding 4.875 per cent 2020 bonds at a price of 102 per
cent.
On 27 May 2019 Gold Fields announced the successful buyback of
US$250 million of the outstanding 2020 notes at 102 per cent of par
as compared with a premium of 101.73 per cent of par at the close
of business on 24 May 2019.
The remainder of the 2020 notes (US$600 million), due in October
2020, is expected to be repaid from a combination of available cash
and bank debt facilities.
US$1,200 million revolving credit facility
On 25 July 2019, Gold Fields Orogen Holding (BVI) Limited and
Gold Fields Ghana Holdings (BVI) Limited entered into a US$1,200
million revolving credit facilities agreement, with a syndicate of
international banks and financial institutions. The new facilities
which became effective on the same day comprise two tranches:
· US$600 million 3+1+1 (upfront extension option subject to bank
consent) year revolving credit facility (RCF) – at a margin of
1.45 per cent over Libor; and
· US$600 million 5+1+1 (upfront extension option subject to bank
consent) year revolving credit facility (RCF) – at a margin of
1.70 per cent over Libor.
Gold Fields was upgraded to Baa3 by Moody’s on 26 June 2018
and the new transaction allowed the Company to align the
documentation to Investment Grade terms and conditions. Gold
Fields has also adopted IFRS 16 and improved its financial
covenants to accommodate the treatment of operating leases as
follows:
· Net Debt to EBITDA covenant has moved from 2.5 times to
3.5 times; and
· Consolidated EBITDA to Consolidated Net Finance Charges
covenant has been reduced from 5 times to 4 times.
The purpose of the new facilities is:
· to refinance the US$1,290 million credit facilities agreement
dated 6 June 2016;
· to repay the Gold Fields bonds maturing in 2020; and
· to fund general corporate and working capital requirements of
the Gold Fields group.
The successful completion of the new bonds, as well as the
buyback and refinancing of the syndicated bank debt, helps Gold
Fields achieve one of its key financial objectives for 2019 of
extending the maturity of its debt profile.
Sale of non-core investments to pay down debt
On 6 June 2019 and in line with its key strategic objective of paying
down its debt, Gold Fields sold its shareholdings in two of its non-
core investments, Maverix Metals and Red 5, for combined
proceeds of US$88 million. Both positions were sold at a significant
premium to the look-through acquisition costs.
Gold Fields completed the sale of its 19.9 per cent shareholding in
Toronto-listed gold and royalty streaming company Maverix. The
sale of the shares – processed through a series of private market
transactions over the past four weeks – raised C$91.4 million
(US$67 million).
Gold Fields retains 4.125 million Maverix warrants, equivalent to a
3.68 per cent interest in the company on a partially-diluted basis.
Gold Fields sold the bulk of its royalty portfolio to Maverix in
December 2016 in return for the 19.9 per cent shareholding.
In April 2019, Gold Fields sold its 247 million shares in ASX-listed
mining company Red 5 – equivalent to 19.9 per cent of its total
shareholding – at A$0.12 per share for a total consideration of
A$29.6 million (US$21 million). Gold Fields had acquired the stake
at A$0.05 per share in October 2017 when it sold its Darlot gold
mine in Western Australia to Red 5.
Agnew mine to be powered by renewables in industry-
leading project
On 19 June 2019 Gold Fields’ Agnew gold mine in Western
Australia became one of Australia’s first mining operations to be
predominantly powered by renewable and low-carbon energy.
Gold Fields and global energy group EDL announced an A$112
million investment in a world-leading energy microgrid combining
wind, solar, gas and battery storage. The microgrid will be owned
and operated by EDL, which will recoup its investment via a 10-year
electricity supply agreement with Agnew.
The project, has the backing of the Australian Government with the
Australian Renewable Energy Agency (ARENA) contributing a
recoupable A$13.5 million to its construction, which will be
recouped over a period of 15 years once the assets are amortised
in full.
The Agnew microgrid is initially forecast to provide 55 – 60 per cent
of the mine’s energy needs, with potential to meet almost all energy
requirements at certain times. The Agnew microgrid will consist of:
· Five wind turbines which will deliver 18MW of power;
· A 10,000-panel solar farm contributing 4MW;
· A 4MWh battery energy storage system (BESS); and
· A 16MW gas engine power station to underpin supply when
required.
The hybrid microgrid at Agnew follows the announcement of a
microgrid at Gold Fields’ Granny Smith mine, featuring 20,000 solar
panels and a 1MWh battery system planned for completion in the
December quarter 2019.
Cash dividend
In line with the Company’s dividend policy to pay out a dividend of
between 25 and 35 per cent of its profit, the Board has approved
and declared an interim dividend number 90 of 60 SA cents per
ordinary share (gross) in respect of the six months ended 30 June
2019. This translates to 28 per cent of normalised profit. The
interim 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 60 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 48 SA cents per ordinary
share for shareholders liable to pay the dividends tax;
· Gold Fields currently has 828,632,707 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:
· Interim dividend number 90: 60 SA cents per share
· Last date to trade cum-dividend: Tuesday, 3 September 2019
· Sterling and US dollar conversion date: Wednesday,
4 September 2019
· Shares commence trading ex-dividend: Wednesday,
4 September 2019
· Record date: Friday, 6 September 2019
· Payment of dividend: Monday, 9 September 2019
21
Gold Fields 2019 H1 RESULTS
Share certificates may not be dematerialised or rematerialised
between: Wednesday, 4 September 2019 and: Friday,
6 September 2019, both dates inclusive.
Mining charter
Engagements between the Department of Mineral Resources and
Energy (DMRE) and the Minerals Council South Africa in respect of
Mining Charter III are continuing. The Minerals Council has sought
a resolution to a number of provisions in Mining Charter III that the
industry cannot support since it was gazetted in September 2018.
While some talks had been held with the DMRE, these were not
finalised at the time the statutory 180-day deadline. As a result, the
Minerals Council lodged an application for a review of certain
elements of Mining Charter III.
The focus of the review application is on the failure to recognise the
continuing consequences of previous transactions in respect of
renewals and transfers of rights, and for the DMRE to explain the
targets set for local content in terms of the procurement element.
The High Court is expected to hear the application later this year.
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 (based on the original WGC interpretation) 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.
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 2019 H1 RESULTS
22
Basis of preparation
The unaudited condensed consolidated interim financial statements
are prepared in accordance with International Financial Reporting
Standard, (IAS) 34 Interim Financial Reporting, the SAICA Financial
Reporting Guides as issued by the Accounting Practices Committee
and Financial Pronouncements as issued by Financial Reporting
Standards Council and the requirements of the Companies Act of
South Africa.
The accounting policies applied in the preparation of these interim
financial statements are in terms of International Financial
Reporting Standards and are consistent with those applied in the
previous annual financial statements except for the adoption of
IFRS 16 Leases (IFRS 16).
Changes in significant accounting policies
The Group applied IFRS 16 initially on 1 January 2019, using the
modified retrospective approach. The Group recognised lease
liabilities in relation to leases which had previously been classified
as ‘operating leases’ under the principles of IAS 17 Leases. These
liabilities were measured at the present value of the remaining lease
payments, discounted using the interest rate implicit in the lease or
the lessee’s incremental borrowing rate as of 1 January 2019. This
resulted in an additional lease liability of US$210 million. The Group
elected to recognise the right-of-use assets at an amount equal to
the lease liability at 1 January 2019; and the Group applied the
following practical expedients for IFRS 16:
· Leases for which the underlying asset is of low value; and
· Short term leases.
For leases previously classified as finance leases the entity
recognised the carrying amount of the lease asset and lease liability
immediately before transition as the carrying amount of the right of
use asset and the lease liability at the date of initial application.
The key judgements applied by the Group in applying IFRS 16,
included the following:
· Assessing whether an arrangement contains a lease;
· Determining the discount rate; and
· Determining the non-lease components of an
arrangement that will be separated.
The Group recognised right-of-use assets and lease liabilities for its
operating leases for the following material contracts:
· Power Purchase Agreements (PPAs);
· Rental of gas pipelines;
· Ore haulage and site services;
· Transportation contracts
· Mining equipment hire; and
· Property rentals.
The adoption of IFRS 16 affected all segments in the Group.
US$’m
Operating lease commitments
657.4
Reconciled as follows:
Non-lease elements
1
(356.8)
Discounting
(91.0)
Lease liability
209.6
1
The operating lease commitments consist mainly of power purchase agreements
entered into at Tarkwa, Damang, Granny Smith and Gruyere. Included in these
amounts are payments for non-lease elements of the arrangement.
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 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.
On 26 July 2019, a full bench of the High Court of South Africa
(Gauteng Local Division, Johannesburg) (the “Court”) approved the
settlement of the silicosis and tuberculosis class action by
sanctioning the Settlement Agreement and making it an order of
court.
One further step that needs to be taken before the commencement
of the operations of the Trust which will administer claims and
payments to eligible claimants, is that class members need to be
given the opportunity to opt out of the settlement. This is because
the agreement acknowledges that no individual can be forced to
forego his or her right to pursue litigation should he or she so
choose.
Once the opt out period is over and the Settlement Agreement
becomes effective, the Tshiamiso Trust will then commence and the
real work of implementing the settlement agreement will begin. This
will include the Trust tracking and tracing class members,
processing all submitted claims, including the undertaking of benefit
medical examinations and the payment of benefits to eligible
claimants.
Benefits provided for in the agreement and other details can be
found at https://www.silicosissettlement.co.za/about.
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 30 June 2019, the provision for Gold
Fields’ share of the settlement of the class action claims and related
costs amounts to US$27 million (R384 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$30 million (R390 million). The decrease is due to a change in
the timing of expected cash flows.
The ultimate outcome of this matter remains uncertain, with a
possible failure to fulfil all the suspensive conditions. The provision
is consequently subject to adjustment in the future.
23
Gold Fields 2019 H1 RESULTS
Segment reporting
The net profit/(loss) (excluding Asanko) per the income statement
reconciles to the net profit/(loss) in the segmental operating and
financial results as follows:
2019
US$’m
Net profit
78.7
– Operating segments
187.6
– Corporate and projects
(108.9)
2018
US$’m
Net loss
(369.2)
– Operating segments
(68.6)
– Corporate and projects
(300.6)
Nick Holland
Chief Executive Officer
15 August 2019
24
Gold Fields 2019 H1 RESULTS
The financial statements are presented on a condensed consolidated basis
INCOME STATEMENT
United States Dollars
Six months ended
Figures in millions unless otherwise stated
June
2019
June
2018
Revenue
1,378.5
1,350.7
Cost of sales
(986.4)
(1,034.8)
Cost of sales before amortisation and depreciation
(694.5)
(687.9)
– Cost of sales before gold inventory change and amortisation and depreciation
(700.1)
(703.0)
– Gold inventory change
5.6
15.1
– Amortisation and depreciation
(291.9)
(346.9)
Interest expense, net
(30.9)
(33.2)
Share of results of equity accounted investees, net of taxation
(0.5)
(6.0)
(Loss)/gain on foreign exchange
(0.1)
2.8
(Loss)/gain on financial instruments
(109.4)
23.9
Share-based payments
(11.2)
(20.3)
Long-term incentive plan
(5.8)
(1.3)
Other costs, net
(35.9)
(29.6)
Exploration expenses
(43.5)
(56.1)
Profit before royalties, taxation and non-recurring items
154.8
196.1
Non-recurring items
19.0
(661.2)
Profit/(loss) before royalties and taxation
173.8
(465.1)
Royalties
(33.6)
(33.3)
Profit/(loss) before taxation
140.2
(498.4)
Mining and income taxation
(61.5)
129.2
– Normal taxation
(82.9)
(73.9)
– Deferred taxation
21.4
203.1
Profit/(loss) for the period
78.7
(369.2)
Attributable to:
– Owners of the parent
70.5
(366.6)
– Non-controlling interest
8.2
(2.6)
Non-recurring items:
Profit on disposal of Maverix
14.6
–
Profit/(loss) on disposal of assets
0.1
(53.1)
Restructuring costs
(0.3)
(100.3)
Reversal of FSE impairment
9.6
–
Loss on buy-back of bond
(5.0)
–
Silicosis provision adjusted
–
3.0
Impairment of South Deep
–
(481.5)
Impairment of investments and assets
–
(20.0)
Loss on disposal of inventory
–
(8.9)
Other
–
(0.4)
Total non-recurring items
19.0
(661.2)
Taxation on items above
0.1
166.6
Non-recurring items after tax
19.1
(494.6)
Profit/(loss) attributable to owners of the parent
70.5
(366.6)
Profit/(loss) per share (cents) attributable to owners of the parent
9
(45)
Diluted profit/(loss) per share (cents) attributable to owners of the parent
8
(44)
Headline earnings attributable to owners of the parent
39.9
66.7
Headline earnings per share (cents) attributable to owners of the parent
5
8
Diluted headline earnings per share (cents) attributable to owners of the parent
5
8
Profit excluding gains and losses on foreign exchange, financial instruments and non-recurring items after
taxation and non-controlling interest
126.2
42.8
Profit per share excluding gains and losses on foreign exchange, financial instruments and non-recurring items
after taxation and non-controlling interest (cents)
15
5
US dollar/South African rand conversion rate
14.22
12.25
US dollar/Australian dollar conversion rate
0.71
0.77
Gold equivalent sold – managed
eq oz (000)
1,062
1,034
Gold
equivalent
price
received
US$/eq oz
1,298
1,306
Figures may not add as they are rounded independently.
The consolidated financial statements for the six months ended 30 June 2019 have been prepared by the corporate accounting staff of Gold Fields Limited headed by
Tzvet Ilarionova, the Group Financial Controller. This process was supervised by Paul Schmidt, the Group Chief Financial Officer.
25
Gold Fields 2019 H1 RESULTS
STATEMENT OF COMPREHENSIVE INCOME
United States Dollars
Six months ended
Figures in millions unless otherwise stated
June
2019
June
2018
Profit/(loss) for the period
78.7
(369.2)
Other comprehensive income, net of tax
39.7
(158.9)
Equity investments at FVOCI – net change in fair value *
31.1
8.8
Taxation on above item *
(8.2)
(1.5)
Foreign currency translation adjustments
#
16.8
(166.2)
Total comprehensive income for the period
118.4
(528.1)
Attributable to:
– Owners of the parent
110.2
(525.5)
– Non-controlling interest
8.2
(2.6)
118.4
(528.1)
* Items that will not be reclassified to profit or loss.
#
Item can be subsequently reclassified to profit or loss.
STATEMENT OF FINANCIAL POSITION
United States Dollars
Figures in millions unless otherwise stated
June
2019
December
2018
Non-current assets
5,480.4
5,183.2
Property, plant and equipment
4,569.7
4,259.2
Other non-current assets
200.4
194.1
Equity accounted investees
186.9
225.1
Investments
252.6
235.3
Deferred taxation
270.8
269.5
Current assets
1,035.4
921.1
Other current assets
500.6
521.4
Cash and cash equivalents
534.8
399.7
Total assets
6,515.8
6,104.3
Total equity
2,825.0
2,706.9
Non-current liabilities
3,045.9
2,781.9
Deferred taxation
433.1
454.9
Borrowings
2,033.0
1,925.3
Environmental rehabilitation provisions
287.5
289.6
Lease liabilities
253.8
80.1
Long-term incentive plan
7.9
2.1
Other long-term provisions
30.6
29.9
Current liabilities
644.9
615.5
Other current liabilities
602.9
520.7
Current portion of borrowings
–
86.3
Current portion of lease liabilities
42.0
8.5
Total equity and liabilities
6,515.8
6,104.3
US dollar/South African rand conversion rate
14.33
14.63
US dollar/Australian dollar conversion rate
0.69
0.70
Net debt (borrowings net of cash and cash equivalents)
1,498.2
1,611.9
Net debt (borrowings and lease liabilities net of cash and cash equivalents)
1,794.0
–
Gold Fields 2019 H1 RESULTS
26
STATEMENT OF CHANGES IN EQUITY
United States Dollars
Figures in millions unless otherwise stated
Stated
capital
Other
reserves
Retained
earnings
Non-controlling
interest
Total
equity
Balance at 31 December 2018
3,622.5
(2,110.3)
1,073.9
120.8
2,706.9
Total comprehensive income
–
39.7
70.5
8.2
118.4
Profit for the period
–
–
70.5
8.2
78.7
Other comprehensive income
–
39.7
–
–
39.7
Dividends declared
–
–
(11.5)
–
(11.5)
Share-based payments
–
11.2
–
–
11.2
Balance as at 30 June 2019
3,622.5
(2,059.4)
1,132.9
129.0
2,825.0
United States Dollars
Figures in millions unless otherwise stated
Stated
capital
Other
reserves
Retained
earnings
Non-controlling
interest
Total
equity
Balance at 31 December 2017
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
–
(158.9)
(366.6)
(2.6)
(528.1)
Loss for the period
–
–
(366.6)
(2.6)
(369.2)
Other comprehensive income
–
(158.9)
–
–
(158.9)
Dividends declared
–
–
(34.7)
–
(34.7)
Share-based payments
–
20.3
–
–
20.3
Balance as at 30 June 2018
3,622.5
(1,956.4)
1,066.3
124.6
2,857.0
DEBT MATURITY LADDER
United States Dollars
Figures in millions unless otherwise stated
31 Dec
2019
31 Dec
2020
31 Dec
2021
31 Dec
2023
31 Dec
2024
31 Dec
2029
Total
Uncommitted loan facilities
Rand million
1,650.0
–
–
–
–
–
1,650.0
US dollar million
–
–
–
–
–
–
–
Rand debt translated to dollar
115.1
–
–
–
–
–
115.1
Total (US$’m)
115.1
–
–
–
–
–
115.1
Committed loan facilities
US dollar million
–
898.4
1,010.0
–
496.0
496.0
2,900.4
Rand million
–
1,000.0
–
1,500.0
–
–
2,500.0
A$ million
–
–
500.0
–
–
–
500.0
Rand debt translated to dollar
–
69.8
–
104.7
–
–
174.5
A$ debt translated to dollar
–
–
346.5
–
–
–
346.5
Total (US$’m)
–
968.2
1,356.5
104.7
496.0
496.0
3,421.4
Total (US$’m) – Uncommitted and committed
loan facilities
115.1
968.2
1,356.5
104.7
496.0
496.0
3,536.5
Utilisation – Uncommitted loan facilities
Rand million
–
–
–
–
–
–
–
US dollar million
–
–
–
–
–
–
–
Rand debt translated to dollar
–
–
–
–
–
–
–
Total (US$’m)
–
–
–
–
–
–
–
Utilisation – Committed loan facilities
(including
US$
bond)
US dollar million
–
684.2
45.0
–
496.0
496.0
1,721.2
Rand million
–
–
–
–
–
–
–
A$ million
–
–
450.0
–
–
–
450.0
Rand debt translated to dollar
–
–
–
–
–
–
–
A$ debt translated to dollar
–
–
311.8
–
–
–
311.8
Total (US$’m)
–
684.2
356.8
–
496.0
496.0
2,033.0
Total (US$’m) – Utilisation – Uncommitted
and committed loan facilities
–
684.2
356.8
–
496.0
496.0
2,033.0
Exchange rate: US$1 = R14.33 and US$1 = A$0.69 being the closing rates at 30 June 2019.
27
Gold Fields 2019 H1 RESULTS
STATEMENT OF CASH FLOWS
United States Dollars
Six months ended
Figures in millions unless otherwise stated
June
2019
June
2018
Cash flows from operating activities
425.7
262.9
Profit before royalties, tax and non-recurring items
154.8
196.1
Non-recurring items
19.0
(661.2)
Amortisation and depreciation
291.9
346.9
Other non-cash items
#
85.7
563.5
South Deep BEE dividend
(1.4)
(1.7)
Payment of long-term incentive plan
–
(17.8)
Change in working capital
(25.2)
5.9
Royalties and taxation paid
(99.1)
(168.8)
Dividends paid
(11.5)
(34.7)
Owners of the parent
(11.5)
(34.7)
Cash flows from investing activities
(277.4)
(319.6)
Capital expenditure – additions
(356.3)
(410.8)
Proceeds on disposal of property, plant and equipment
0.9
76.6
Purchase of investments
(6.0)
(17.6)
Proceeds on disposal of Maverix
66.8
–
Proceeds on disposal of assets held for sale
–
40.0
Proceeds on disposal of investments
20.9
–
Contributions to environmental trust funds
(3.7)
(7.8)
Cash flows from financing activities
0.3
115.1
Loans received
1,520.7
358.1
Loans repaid
(1,503.2)
(243.0)
Payment of lease liabilities
(17.2)
–
Net cash inflow
137.1
23.7
Translation adjustment
(2.0)
(4.6)
Cash and cash equivalent at beginning of the period
399.7
479.0
Cash and cash equivalent at end of the period
534.8
498.1
Cash flow from operating activities less net capital expenditure and environmental payments and
lease payments
49.4
(79.1)
#
Other non-cash items for six months ended June 2018 include impairment of South Deep (US$481.5 million) and impairment of investments and assets (US$20.0 million).
RECONCILIATION OF HEADLINE EARNINGS
United States Dollars
Six months ended
Figures in millions unless otherwise stated
June
2019
June
2018
Net profit/(loss)
70.5
(366.6)
(Profit)/loss on disposal of assets
(0.1)
53.1
Taxation effect on disposal of assets
–
(12.1)
Non-controlling effect on disposal of assets
–
(2.6)
Profit on disposal of Maverix
(33.8)
–
Impairment of South Deep
–
481.5
Reversal of FSE impairment
(9.6)
–
Impairment of investments and assets and other non-recurring items
18.5
43.3
Taxation on impairment of assets and other non-recurring items
(5.6)
(129.9)
Headline earnings
39.9
66.7
Headline earnings per share – cents
5
8
Based on headline earnings as given above divided by 826,085,128 (June 2018 – 820,614,217) being the
weighted average number of ordinary shares in issue.
Gold Fields 2019 H1 RESULTS
28
HEDGING/DERIVATIVES
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 based on 50 per cent of usage over the specified period. 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$49.8 per barrel.
In June 2019 fixed price ICE Gasoil cash settled swap transactions were entered into for a total of 123.2 million litres of diesel for the period January 2020 to
December 2022 based on 50 per cent of usage over the specified period. The average swap price is US$575 per metric tonne (equivalent to US$75.8 per
barrel). At the time of the transactions, the average Brent swap equivalent over the tenor was US$59.2 per barrel.
At the reporting date, the mark to market value on the hedge was positive US$3 million with a realised gain of US$3 million for the six months ended 30 June
2019.
Ghana – Gold hedge
In June 2019, a total of 275,000 ounces of the expected production for 2020 for the Ghanaian region was hedged for the period January 2020 to December
2020 using cash settled zero-cost collars (175,000 ounces) and average rate forwards (100,000 ounces). The average strike prices are US$1,364 per ounce
on the floor and US$1,449 per ounce on the cap. The average strike price on the forwards is US$1,382 per ounce.
At the reporting date, the mark to market value on the hedge was negative US$8 million.
Subsequent to 30 June 2019, 100,000 ounces of the expected production for the Ghanaian region was hedged for the period January 2020 to December
2020 using cash settled zero cost collars. The average strike prices are US$1,400 per ounce on the floor and US$1,557 per ounce on the cap.
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 based on 50 per cent of usage over the specified period. The average swap price is US$61.2 per barrel. At the
time of the transactions, the average Brent swap equivalent over the tenor was US$49.9 per barrel.
In June 2019 fixed price Singapore 10ppm Gasoil cash settled swap transactions were entered into for a total of 75.0 million litres of diesel for the period
January 2020 to December 2022 based on 50 per cent of usage over the specified period. The average swap price is US$74.0 per barrel. At the time of the
transactions, the average Brent swap equivalent over the tenor was US$57.4 per barrel.
At the reporting date, the mark to market value on the hedge was positive A$4 million (US$3 million) with a realised gain of A$2 million (US$2 million) for the
six months ended 30 June 2019.
Australia – Gold hedge
In December 2018, a total of 456,000 ounces of the expected production for the Australian region was hedged for the period January 2019 to December 2019
using cash settled zero cost collars (173,000 ounces) and average rate forwards (283,000 ounces). The average strike prices are A$1,751 per ounce on the
floor and A$1,800 per ounce on the cap. The average strike on the forwards is A$1,751 per ounce.
In January 2019, a total of 456,000 ounces of the expected production for the Australian region was hedged for the period January 2019 to December 2019
using cash settled zero cost collars. The average strike prices are A$1,800 per ounce on the floor and A$1,869 per ounce on the cap.
In June 2019, a total of 480,000 ounces of the expected production for 2020 for the Australian region was hedged for the period January 2020 to December
2020 using cash settled zero cost collars (270,000 ounces) and average rate forwards (210,000 ounces). The average strike prices are A$1,933 per ounce
on the floor and A$2,014 on the cap. The average strike price on the forwards is A$1,957 per ounce.
At the reporting date, the mark to market value on the hedges was negative A$141 million (US$98 million) with a realised loss of A$14 million (US$10 million)
for the six months ended 30 June 2019.
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$13 million (US$9 million) with a realised loss of A$7 million (US$5 million) for
the six months ended 30 June 2019.
South Africa – Gold hedge
Between October 2018 and January 2019 cash settled average rate forwards were entered into for a total of 112,613 ounces for the period June 2019 to
December 2019 at an average strike rate of R617,000 per kilogram.
In June 2019, a total of 200,000 ounces of the expected production for 2020 for South Deep was hedged for the period January 2020 to December 2020
using cash settled zero cost collars (100,000 ounces) and average rate forwards (100,000 ounces). The average strike price is R660,000 per kilogram on
the floor and R727,000 per kilogram on the cap. The average strike price is R681,400 per kilogram on the forwards.
At the reporting date, the mark to market value on the hedge was negative R161 million (US$11 million) with a R5 million (US$nil million) realised gain for the
six months ended 30 June 2019.
* Do not qualify for hedge accounting and are accounted for as derivative financial instruments in the income statement.
#
Asian swop 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).
29
Gold Fields 2019 H1 RESULTS
SEGMENTAL OPERATING AND FINANCIAL RESULTS
United States Dollars
Figures in millions
unless otherwise stated
Total
Mine
Operations
Including
Equity
Accounted
Joint Venture
Total
Mine
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
Six months to June 2019
17,915
16,746
540
10,372
6,886
2,317
1,169
3,348
Ore milled/treated ^
Six months to Dec 2018
17,424
16,480
520
9,900
6,907
2,049
944
3,314
(000 tonnes)
Six months to June 2018
16,686
16,686
800
9,040
6,884
2,156
–
3,330
Yield ^
Six months to June 2019
1.9
2.0
5.3
1.3
1.2
1.5
1.5
1.5
(grams per tonne)
Six months to Dec 2018
1.9
1.9
3.6
1.2
1.2
1.4
1.5
1.7
Six months to June 2018
1.9
1.9
3.8
1.2
1.2
1.3
–
1.3
Gold produced
Six months to June 2019
1,121.5
1,066.3
91.7
437.8
270.9
111.8
55.1
157.1
(000 managed equivalent ounces)
Six months to Dec 2018
1,077.4
1,032.8
60.6
396.3
260.5
91.3
44.5
176.5
Six months to June 2018
1,030.4
1,030.4
96.5
353.9
264.4
89.5
–
137.6
Gold sold
Six months to June 2019
1,115.7
1,061.8
90.1
436.6
270.9
111.8
53.9
156.4
(000 managed equivalent ounces)
Six months to Dec 2018
1,070.5
1,024.6
63.6
397.7
260.5
91.3
45.9
167.4
Six months to June 2018
1,034.0
1,034.0
104.2
353.9
264.4
89.5
–
131.7
Gold price received
Six months to June 2019
1,297
1,298
1,314
1,300
1,304
1,303
1,275
1,268
(dollar per equivalent ounce)
Six months to Dec 2018
1,198
1,198
1,148
1,218
1,222
1,219
1,196
1,131
Six months to June 2018
1,306
1,306
1,316
1,318
1,318
1,315
–
1,228
Cost of sales before gold inventory
Six months to June 2019
41
42
219
27
25
28
36
24
change and amortisation and
Six months to Dec 2018
42
42
214
28
23
37
44
25
depreciation (dollar per tonne)
Six months to June 2018
42
42
188
23
20
32
–
23
All-in-sustaining costs
Six months to June 2019
960
949
1,529
892
940
652
1,155
290
(dollar per ounce) original
Six months to Dec 2018
987
983
2,239
927
948
796
1,069
340
interpretation
Six months to June 2018
954
954
1,699
924
954
829
–
197
All-in-sustaining costs
Six months to June 2019
877
862
1,529
892
940
652
1,155
264
(dollar per ounce) revised
interpretation
Total all-in-cost
Six months to June 2019
1,070
#
1,061
#
1,529
1,007
940
1,061
1,235
290
(dollar per ounce)
Six months to Dec 2018
1,126
#
1,123
#
2,335
1,084
948
1,428
1,175
340
Six months to June 2018
1,106
#
1,106
#
1,816
1,114
954
1,585
–
197
Financial Results ($ millions)
Revenue
Six months to June 2019
1,447.4
1,378.7
118.4
567.7
353.4
145.6
68.7
198.3
Six months to Dec 2018
1,282.0
1,227.1
73.0
484.5
318.3
111.3
54.9
189.4
Six months to June 2018
1,350.7
1,350.7
137.1
466.3
348.6
117.7
–
161.6
Cost of sales before
Six months to June 2019
(736.9)
(694.8)
(117.4)
(258.1)
(157.2)
(58.8)
(42.1)
(81.1)
amortisation and depreciation
Six months to Dec 2018
(724.5)
(687.1)
(118.1)
(257.7)
(158.6)
(61.7)
(37.4)
(77.2)
Six months to June 2018
(688.1)
(688.1)
(153.6)
(212.9)
(150.2)
(62.7)
–
(77.6)
Cost of sales before gold inventory
Six months to June 2019
(743.0)
(700.3)
(118.5)
(278.4)
(170.3)
(65.5)
(42.6)
(81.2)
change and amortisation and
Six months to Dec 2018
(729.8)
(688.2)
(111.3)
(276.9)
(159.8)
(75.5)
(41.6)
(82.9)
depreciation
Six months to June 2018
(703.2)
(703.2)
(150.7)
(206.9)
(138.9)
(68.0)
–
(77.4)
– Gold inventory change
Six months to June 2019
6.1
5.6
1.2
20.3
13.1
6.8
0.5
–
Six months to Dec 2018
5.3
1.1
(6.7)
19.3
1.2
13.8
4.2
5.6
Six months to June 2018
15.1
15.1
(2.9)
(6.1)
(11.3)
5.3
–
(0.1)
Amortisation of mining assets
Six months to June 2019
(305.0)
(287.0)
(16.8)
(138.6)
(90.7)
(29.8)
(18.1)
(46.0)
Six months to Dec 2018
(335.4)
(319.8)
(21.0)
(153.4)
(83.2)
(54.7)
(15.5)
(48.7)
Six months to June 2018
(344.9)
(344.9)
(27.9)
(130.3)
(85.1)
(45.2)
–
(33.1)
Other expenses
Six months to June 2019
(97.9)
(93.5)
(17.3)
(31.6)
(16.6)
(10.6)
(4.4)
(10.8)
Six months to Dec 2018
(26.4)
(26.1)
(9.1)
(4.0)
(0.1)
(3.5)
(0.3)
(4.6)
Six months to June 2018
(36.5)
(36.5)
(10.4)
5.4
5.8
(0.4)
–
(3.8)
Profit/(loss) before royalties
Six months to June 2019
307.5
303.4
(33.1)
139.4
88.9
46.4
4.1
60.4
and taxation
Six months to Dec 2018
195.9
194.3
(75.2)
69.5
76.4
(8.6)
1.7
58.7
Six months to June 2018
281.1
281.1
(54.8)
128.4
119.0
9.4
–
47.3
Royalties, mining and
Six months to June 2019
(119.9)
(115.6)
9.0
(60.1)
(37.2)
(18.5)
(4.3)
(16.1)
income taxation
Six months to Dec 2018
(83.7)
(81.0)
12.0
(5.3)
(13.5)
10.9
(2.8)
(36.6)
Six months to June 2018
53.2
53.2
149.8
(12.1)
(6.0)
(6.1)
–
(24.9)
– Normal taxation
Six months to June 2019
(51.4)
(51.4)
–
(27.5)
(27.5)
–
–
(27.6)
Six months to Dec 2018
(133.1)
(133.1)
–
(15.3)
(15.3)
–
–
(28.3)
Six months to June 2018
(28.3)
(28.3)
–
(4.3)
(4.3)
–
–
(23.8)
– Royalties
Six months to June 2019
(37.1)
(33.6)
(0.6)
(19.7)
(11.5)
(4.7)
(3.5)
(2.7)
Six months to Dec 2018
(32.0)
(29.2)
(0.4)
(15.7)
(9.6)
(3.3)
(2.8)
(2.5)
Six months to June 2018
(33.3)
(33.3)
(0.6)
(15.6)
(11.6)
(4.0)
–
(2.6)
– Deferred taxation
Six months to June 2019
(31.4)
(30.5)
9.6
(12.9)
1.7
(13.8)
(0.8)
14.2
Six months to Dec 2018
81.4
81.4
12.3
25.7
11.5
14.2
–
(5.9)
Six months to June 2018
114.8
114.8
150.4
7.8
9.9
(2.1)
–
1.6
Profit/(loss) before non-
Six months to June 2019
187.6
187.8
(24.1)
79.4
51.7
27.9
(0.2)
44.3
recurring items
Six months to Dec 2018
112.1
113.1
(63.3)
64.2
62.9
2.3
(1.1)
22.1
Six months to June 2018
334.3
334.3
95.0
116.4
113.0
3.3
–
22.4
Non-recurring items
Six months to June 2019
(0.2)
(0.2)
(0.1)
0.1
0.1
–
–
–
Six months to Dec 2018
(4.9)
(4.9)
3.3
(6.7)
(7.4)
0.7
–
(2.0)
Six months to June 2018
(402.9)
(402.9)
(259.8)
(143.0)
(128.4)
(14.6)
–
–
Net profit/(loss)
Six months to June 2019
187.4
187.6
(24.2)
79.5
51.8
27.9
(0.2)
44.3
Six months to Dec 2018
107.3
108.2
(59.9)
57.5
55.5
2.9
(1.1)
20.2
Six months to June 2018
(68.6)
(68.6)
(164.8)
(26.6)
(15.4)
(11.2)
–
22.4
Capital expenditure
Six months to June 2019
(370.8)
#
(354.8)
#
(17.6)
(134.1)
(68.3)
(49.7)
(16.0)
(16.4)
Six months to Dec 2018
(414.7)
#
(401.9)
#
(27.4)
(151.1)
(72.5)
(65.8)
(12.8)
(23.3)
Six months to June 2018
(397.4)
#
(397.4)
#
(30.9)
(156.3)
(83.6)
(72.7)
–
(9.9)
The average US dollar/Rand exchange rates for the six months were US$1 = R14.22 for June 2019 and US$1 = R12.25 for June 2018.
The average Australian/US dollar exchange rates for the six months were A$1 = US$0.71 for June 2019 and A$1 = US$0.77 for June 2018.
Figures may not add as they are rounded independently.
* Equity accounted Joint Venture comparatives for the six months to December 2018 represent only five months since acquisition.
#
Includes non-sustaining capital expenditure for Gruyere mine project of US$64.9 million (A$91.9 million) for June 2019, US$68.2 million (A$94.1 million) for December 2018
and US$66.2 million (A$85.7 million) for June 2018, respectively.
^ Excludes Gruyere physicals.
Gold Fields 2019 H1 RESULTS
30
SEGMENTAL OPERATING AND FINANCIAL RESULTS
United States Dollars
Australian Dollars
South
African Rand
Figures in millions
unless otherwise stated
Australia
Region
Australia
Region
1
South Africa
Region
2
Continuing
Continuing
Total
St Ives
Agnew
Granny
Smith
Total
St Ives
Agnew
Granny
Smith
South
Deep
Operating Results
Ore milled/treated (000 tonnes) ^
Six months to June 2019
3,655
2,251
586
818
3,655
2,251
586
818
540
Six months to Dec 2018
3,690
2,158
590
942
3,690
2,158
590
942
548
Six months to June 2018
3,517
2,093
588
836
3,517
2,093
588
836
800
Yield (grams per tonne) ^
Six months to June 2019
3.6
2.6
6.0
5.1
3.6
2.6
6.0
5.1
5.3
Six months to Dec 2018
3.7
2.6
6.5
4.7
3.7
2.6
6.5
4.7
3.6
Six months to June 2018
3.9
2.8
6.1
5.1
3.9
2.8
6.1
5.1
3.8
Gold produced (000 managed
Six months to June 2019
434.9
187.6
113.3
134.0
434.9
187.6
113.3
134.0
2,851
equivalent ounces)
Six months to Dec 2018
444.0
177.1
123.7
143.2
444.0
177.1
123.7
143.2
1,882
Six months to June 2018
442.4
189.8
115.4
137.2
442.4
189.8
115.4
137.2
3,003
Gold sold (000 managed
Six months to June 2019
432.5
183.2
115.4
133.9
432.5
183.2
115.4
133.9
2,804
equivalent ounces)
Six months to Dec 2018
441.6
176.8
121.6
143.2
441.6
176.8
121.6
143.2
1,980
Six months to June 2018
444.3
190.2
116.9
137.3
444.3
190.2
116.9
137.3
3,240
Gold price received (dollar per
Six months to June 2019
1,302
1,299
1,304
1,303
1,843
1,840
1,846
1,845
600,601
equivalent ounce)
Six months to Dec 2018
1,212
1,210
1,211
1,214
1,681
1,683
1,677
1,681
552,020
Six months to June 2018
1,318
1,318
1,316
1,320
1,707
1,707
1,704
1,709
518,504
Cost of sales before gold inventory
Six months to June 2019
71
48
136
94
101
68
192
133
3,119
change and amortisation and
Six months to Dec 2018
70
44
133
91
97
61
184
129
2,943
depreciation (dollar per tonne)
Six months to June 2018
76
51
138
97
99
66
179
125
2,308
All-in sustaining costs
Six months to June 2019
1,035
1,008
1,238
895
1,465
1,427
1,753
1,268
698,982
(dollar per ounce) original
Six months to Dec 2018
986
1,052
979
910
1,369
1,461
1,360
1,264
1,080,999
interpretation
Six months to June 2018
900
763
1,075
942
1,166
988
1,393
1,219
669,306
All-in sustaining costs
Six months to June 2019
841
859
944
727
1,191
1,217
1,337
1,029
698,982
(dollar per ounce) revised
interpretation
Total all-in-cost
Six months to June 2019
1,185
#
1,008
1,238
895
1,677
#
1,427
1,753
1,268
698,982
(dollar per ounce)
Six months to Dec 2018
1,140
#
1,052
979
910
1,571
#
1,461
1,360
1,264
1,034,155
Six months to June 2018
1,050
#
763
1,075
942
1,360
#
988
1,393
1,219
715,373
Financial Results ($ millions)
Revenue
Six months to June 2019
562.9
238.0
150.5
174.5
797.0
337.0
213.1
247.0
1,683.9
Six months to Dec 2018
535.1
214.0
147.3
173.8
742.1
297.5
203.9
240.7
1,093.0
Six months to June 2018
585.7
250.7
153.8
181.2
758.4
324.6
199.2
234.6
1,679.9
Cost of sales before
Six months to June 2019
(280.3)
(122.4)
(81.6)
(76.3)
(396.9)
(173.3)
(115.5)
(108.1)
(1,668.8)
amortisation
Six months to Dec 2018
(271.5)
(107.5)
(76.8)
(87.2)
(374.2)
(147.4)
(106.5)
(120.3)
(1,703.7)
and depreciation
Six months to June 2018
(244.0)
(78.4)
(84.7)
(80.9)
(316.0)
(101.5)
(109.7)
(104.8)
(1,882.1)
Cost of sales before gold
Six months to June 2019
(264.9)
(108.2)
(79.6)
(77.1)
(375.0)
(153.2)
(112.7)
(109.1)
(1,685.3)
inventory change and
Six months to Dec 2018
(258.7)
(94.9)
(78.5)
(85.3)
(358.1)
(131.6)
(108.7)
(117.7)
(1,612.6)
amortisation and depreciation
Six months to June 2018
(268.2)
(106.0)
(81.2)
(81.0)
(347.3)
(137.3)
(105.2)
(104.9)
(1,846.1)
– Gold inventory
Six months to June 2019
(15.5)
(14.2)
(2.0)
0.7
(21.9)
(20.1)
(2.8)
1.0
16.5
change
Six months to Dec 2018
(12.8)
(12.8)
1.8
(1.8)
(16.1)
(15.8)
2.2
(2.6)
(91.1)
Six months to June 2018
24.2
27.7
(3.5)
–
31.3
35.8
(4.5)
0.1
(36.0)
Amortisation of mining
Six months to June 2019
(103.7)
(146.9)
(238.6)
assets
Six months to Dec 2018
(112.1)
(156.8)
(304.2)
Six months to June 2018
(153.7)
(199.0)
(341.8)
Other expenses
Six months to June 2019
(38.2)
(54.1)
(246.5)
Six months to Dec 2018
(8.8)
(13.1)
(129.9)
Six months to June 2018
(27.7)
(35.8)
(127.5)
Profit/(loss) before
Six months to June 2019
140.7
199.2
(470.0)
royalties and taxation
Six months to Dec 2018
142.7
198.1
(1,044.9)
Six months to June 2018
160.3
207.6
(671.5)
Royalties, mining and
Six months to June 2019
(52.7)
(74.6)
127.7
income taxation
Six months to Dec 2018
(53.6)
(74.3)
224.1
Six months to June 2018
(59.6)
(77.2)
1,928.4
– Normal taxation
Six months to June 2019
3.6
5.2
–
Six months to Dec 2018
(89.4)
(119.6)
–
Six months to June 2018
(0.2)
(0.3)
–
– Royalties
Six months to June 2019
(14.1)
(20.0)
(8.4)
Six months to Dec 2018
(13.5)
(18.7)
(5.4)
Six months to June 2018
(14.4)
(18.7)
(7.6)
– Deferred taxation
Six months to June 2019
(42.2)
(59.8)
136.1
Six months to Dec 2018
49.3
64.0
229.5
Six months to June 2018
(45.0)
(58.2)
1,936.0
Profit/(loss) before
Six months to June 2019
88.0
124.6
(342.3)
non-recurring items
Six months to Dec 2018
89.1
123.8
(820.7)
Six months to June 2018
100.7
130.3
1,256.9
Non-recurring items
Six months to June 2019
(0.2)
(0.3)
(1.2)
Six months to Dec 2018
0.5
0.6
41.8
Six months to June 2018
(0.2)
(0.2)
(3,487.2)
Net profit/(loss)
Six months to June 2019
87.8
124.3
(343.5)
Six months to Dec 2018
89.7
124.4
(778.9)
Six months to June 2018
100.5
130.1
(2,230.3)
Capital expenditure
Six months to June 2019
(202.8)
#
(50.7)
(54.7)
(32.5)
(287.2)
#
(71.8)
(77.5)
(46.0)
(250.0)
Six months to Dec 2018
(213.0)
#
(70.2)
(37.4)
(37.2)
(293.7)
#
(96.5)
(51.6)
(51.6)
(391.1)
Six months to June 2018
(200.1)
#
(57.0)
(35.4)
(41.6)
(259.3)
#
(73.8)
(45.9)
(53.8)
(378.8)
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.
#
Includes non-sustaining capital expenditure for Gruyere mine project of US$64.9 million (A$91.9 million) for June 2019, US$68.2 million (A$94.1 million) for December 2018
and US$66.2 million (A$85.7 million) for June 2018, respectively.
^ Excludes Gruyere physicals.
31
Gold Fields 2019 H1 RESULTS
ALL-IN COSTS (Original interpretation)
World Gold Council Industry Standard
United States Dollars
Figures 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
Six months to June 2019
(742.9) (742.9)
(700.3) (118.5) (278.4) (170.3) (65.5) (42.6) (81.2)
inventory change and
Six months to Dec 2018
(729.4)
(730.0)
(688.4)
(111.3)
(276.9)
(159.8)
(75.5)
(41.6)
(82.9)
amortisation and depreciation Six months to June 2018
(703.0)
(703.2)
(703.2)
(150.7)
(206.9)
(138.9)
(68.0)
–
(77.4)
Gold inventory change
Six months to June 2019
6.1
6.1
5.6
1.2
20.3
13.1
6.8
0.5
–
Six months to Dec 2018
5.3
5.3
1.1 (6.7) 19.3 1.2 13.8 4.2
5.6
Six months to June 2018
15.1
15.1
15.1 (2.9) (6.1) (11.3) 5.3
–
(0.1)
Royalties
Six months to June 2019
(37.1)
(37.1)
(33.6)
(0.6) (19.7) (11.5) (4.7) (3.5)
(2.7)
Six months to Dec 2018
(32.0) (32.0)
(29.2)
(0.4) (15.7) (9.6) (3.3) (2.8)
(2.5)
Six months to June 2018
(33.3) (33.3)
(33.3)
(0.6) (15.6) (11.6) (4.0)
–
(2.6)
Realised gains/(losses) on
Six months to June 2019
4.5 4.5
4.5
–
2.9 2.1 0.8
–
–
commodity cost hedges
Six months to Dec 2018
7.4 7.4
7.4
–
4.4 3.3 1.1
–
–
Six months to June 2018
4.8 4.8
4.8
–
3.2 2.2 1.0
–
–
Community/social
Six months to June 2019
(12.6) (12.6)
(12.5)
(1.1) (9.3) (8.5) (0.7) (0.1)
(2.2)
responsibility costs
Six months to Dec 2018
(8.4) (8.4)
(8.4) (0.2) (4.3) (4.1) (0.2)
–
(4.0)
Six months to June 2018
(6.2)
(6.2)
(6.2)
(1.1)
(2.8) (2.6) (0.2)
–
(2.3)
Non-cash remuneration –
Six months to June 2019
(11.2) (6.4)
(6.4) (0.5) (2.6) (1.7) (0.9)
–
(1.1)
share-based payments
Six months to Dec 2018
(17.2) (12.5)
(12.5)
(2.1)
(4.4)
(3.3) (1.1)
–
(1.6)
Six months to June 2018
(20.3) (14.6)
(14.6)
(2.6) (4.4) (3.4) (1.0)
–
(2.7)
Cash remuneration
Six months to June 2019
(5.8) (4.2)
(4.2) (0.7) (1.0) (0.7) (0.3)
–
(0.6)
(long-term incentive plan)
Six months to Dec 2018
0.3 –
–
(0.5) 0.2 0.2 –
–
0.1
Six months to June 2018
(1.3) (1.3)
(1.3) (0.4) (0.4) (0.2) (0.2)
–
0.3
Other
Six months to June 2019
(2.5) (1.6)
(1.6)
–
– – – –
(1.6)
Six months to Dec 2018
(5.2) (1.5)
(1.5)
–
(1.0)
–
– (1.0)
(0.5)
Six months to June 2018
(4.8) (0.6)
(0.6)
–
– – – –
(0.6)
By-product credits
Six months to June 2019
87.3
87.3
87.1
0.1
1.1 0.9 0.1 0.2
85.6
Six months to Dec 2018
84.7 84.7
84.5
0.1 0.8 0.5 0.2 0.2
83.3
Six months to June 2018
86.7 86.7
86.7
0.2 0.2 0.2 –
–
85.9
Rehabilitation amortisation
Six months to June 2019
(10.2)
(10.0)
(9.9)
(0.1)
(2.9) (2.0) (0.7) (0.2)
(3.0)
and interest
Six months to Dec 2018
(9.0) (9.0)
(8.8) (0.1)
(3.4)
(2.7) (0.6) (0.2)
(2.0)
Six months to June 2018
(9.1) (9.1)
(9.1) (0.1) (3.6) (2.8) (0.7)
–
(1.7)
Sustaining capital expenditure Six months to June 2019
(258.3)
(256.7)
(244.2)
(17.6)
(84.8) (68.3) (4.0) (12.5)
#
(16.4)
Six months to Dec 2018
(278.2) (276.9)
(269.0)
(21.3) (87.4) (72.5) (6.9) (7.9)
(23.3)
Six months to June 2018
(253.7) (252.7)
(252.7)
(18.7) (90.2) (83.6) (6.6)
–
(9.9)
Lease payments
Six months to June 2019
(29.9)
(24.5)
(20.6)
(0.1)
(15.2) (7.6) (3.6) (3.9)
(0.4)
Six months to Dec 2018
(2.3) (2.3)
(2.3)
–
– – – –
(0.9)
Six months to June 2018
–
–
–
–
– – – –
–
All-in sustaining costs
Six months to June 2019
(1,012.8)
(998.4)
(936.2)
(137.8)
(389.7) (254.6) (72.8) (62.2)
(23.6)
Six months to Dec 2018
(983.8) (975.0)
(925.8) (142.4) (368.5) (246.9) (72.7) (49.1) (28.7)
Six months to June 2018
(925.1) (914.6)
(914.6) (177.0) (326.5) (252.0) (74.3)
– (11.1)
Exploration, feasibility
Six months to June 2019
(24.1)
(0.8)
–
–
(0.8)
–
– (0.8)
–
and evaluation costs
Six months to Dec 2018
(39.0) 1.2
1.2
–
1.1
– 1.1
–
0.1
Six months to June 2018
(39.2) (1.6)
(1.6)
–
(1.5)
– (1.5)
–
(0.1)
Non-sustaining capital
Six months to June 2019
(114.1)
(49.2)
(45.7)
–
(49.2) –
(45.7)
(3.5)
–
expenditure
Six months to Dec 2018
(138.2) (69.9)
(65.0)
(6.1) (63.8)
(58.9) (4.9)
–
Six months to June 2018
(157.1) (78.3)
(78.3) (12.2) (66.1)
– (66.1)
–
–
Total all-in cost
Six months to June 2019
(1,151.0)
(1,048.5)
(981.9) (137.8) (439.7)
(254.6) (118.6) (66.5)
(23.6)
Six months to Dec 2018
(1,161.2) (1,043.7)
(989.7)
(148.5)
(431.2) (246.9) (130.4) (54.0)
(28.7)
Six months to June 2018
(1,121.4) (994.4)
(994.4) (189.2) (394.1) (252.0) (141.9)
– (11.1)
Total all-in sustaining cost
Six months to June 2019
(1,012.8)
(998.4)
(936.2)
(137.8)
(389.7) (254.6) (72.8) (62.2)
(23.6)
Six months to Dec 2018
(983.8) (975.0)
(925.8) (142.4)
(368.5)
(246.9) (72.7) (49.1)
(28.7)
Six months to June 2018
(925.1) (914.6)
(914.6) (177.0) (326.5) (252.0) (74.3)
– (11.1)
Gold only ounces sold
Six months to June 2019
1,040.5
1,040.5
986.6
90.1
436.6 270.9 111.8 53.9
81.3
– (000 ounces)
Six months to Dec 2018
987.5 987.5
941.6
63.6 397.7 260.5 91.3 45.9
84.4
Six months to June 2018
958.9 958.9
958.9 104.2 353.9 264.4 89.5
–
56.6
AISC per ounce of gold sold Six months to June 2019
973
960
949
1,529
892 940 652
1,155
290
US$/oz
Six months to Dec 2018
996 987
983 2,239 927 948 796 1,069
340
Six months to June 2018
965 954
954 1,699
924
954 829
–
197
Total all-in cost
Six months to June 2019
(1,151.0)
(1,048.5)
(981.9) (137.8) (439.7)
(254.6) (118.6) (66.5)
(23.6)
Six months to Dec 2018
(1,161.2) (1,043.7)
(989.7)
(148.5)
(431.2) (246.9) (130.4) (54.0)
(28.7)
Six months to June 2018
(1,121.4) (994.4)
(994.4) (189.2) (394.1) (252.0) (141.9)
– (11.1)
Gold only ounces sold
Six months to June 2019
1,040.5
1,040.5
986.6
90.1
436.6 270.9 111.8 53.9
81.3
– (000 ounces)
Six months to Dec 2018
987.5 987.5
941.6
63.6 397.7 260.5 91.3 45.9
84.4
Six months to June 2018
958.9 958.9
958.9 104.2 353.9 264.4 89.5
–
56.6
AIC per ounce of gold sold Six months to June 2019
1,106
1,008
995
1,529
1,007 940
1,061
1,235
290
US$/oz
Six months to Dec 2018
1,176 1,057
1,051 2,335 1,084
948 1,428 1,175
340
Six months to June 2018
1,169 1,037
1,037 1,816 1,114
954 1,585
–
197
#
Includes Gold Fields 45 per cent share of deferred stripping of US$23.4 for the six months ended 30 June 2019
Gold Fields 2019 H1 RESULTS
32
ALL-IN COSTS (Original interpretation)
World Gold Council Industry Standard
United States Dollars
Figures in millions
unless otherwise stated
Total
Australia
Region
Corporate
and
projects
Australia
St Ives
Agnew
Granny
Smith
Cost of sales before gold
Six months to June 2019
(264.9)
(108.2)
(79.6)
(77.1)
–
inventory change and
Six months to Dec 2018
(258.7)
(94.9)
(78.5)
(85.3)
0.4
amortisation and depreciation
Six months to June 2018
(268.2)
(106.0)
(81.2)
(81.0)
0.2
Gold inventory change
Six months to June 2019
(15.5)
(14.2)
(2.0)
0.7
–
Six months to Dec 2018
(12.8)
(12.8)
1.8
(1.8)
–
Six months to June 2018
24.2
27.7
(3.5)
–
–
Royalties
Six months to June 2019
(14.1)
(6.2)
(3.6)
(4.4)
–
Six months to Dec 2018
(13.5)
(5.4)
(3.7)
(4.3)
–
Six months to June 2018
(14.4)
(6.2)
(3.7)
(4.5)
–
Realised gains/losses on
Six months to June 2019
1.6
1.0
0.3
0.3
–
commodity cost hedges
Six months to Dec 2018
3.0
2.0
0.5
0.5
–
Six months to June 2018
1.6
0.9
0.4
0.3
–
Community/social
Six months to June 2019
–
–
–
–
–
responsibility costs
Six months to Dec 2018
–
–
–
–
–
Six months to June 2018
–
–
–
–
–
Non-cash remuneration –
Six months to June 2019
(2.2)
(0.8)
(0.6)
(0.8)
(4.8)
share-based payments
Six months to Dec 2018
(4.4)
(1.6)
(1.2)
(1.5)
(4.9)
Six months to June 2018
(4.9)
(1.9)
(1.4)
(1.6)
(5.7)
Cash remuneration
Six months to June 2019
(2.0)
(0.8)
(0.6)
(0.6)
(1.6)
(long-term incentive plan)
Six months to Dec 2018
0.2
0.1
0.1
0.1
0.3
Six months to June 2018
(1.0)
(0.5)
(0.2)
(0.4)
0.1
Other
Six months to June 2019
–
–
–
–
(0.9)
Six months to Dec 2018
–
–
–
–
(3.7)
Six months to June 2018
–
–
–
–
(4.2)
By-product credits
Six months to June 2019
0.5
0.3
0.1
0.1
–
Six months to Dec 2018
0.5
0.3
0.2
–
–
Six months to June 2018
0.4
0.2
0.1
0.1
–
Rehabilitation amortisation
Six months to June 2019
(4.1)
(2.1)
(1.2)
(0.8)
(0.2)
and interest
Six months to Dec 2018
(3.4)
(2.1)
(0.7)
(0.6)
–
Six months to June 2018
(3.8)
(2.3)
(0.8)
(0.7)
–
Sustaining capital expenditure
Six months to June 2019
(137.9)
(50.7)
(54.7)
(32.5)
(1.5)
Six months to Dec 2018
(144.9)
(70.2)
(37.4)
(37.2)
(1.3)
Six months to June 2018
(133.9)
(57.0)
(35.4)
(41.6)
(0.9)
Lease payments
Six months to June 2019
(8.8)
(2.9)
(1.1)
(4.8)
(5.3)
Six months to Dec 2018
(1.4)
(1.4)
–
–
–
Six months to June 2018
–
–
–
–
–
All-in sustaining costs
Six months to June 2019
(447.4)
(184.6)
(142.9)
(119.9)
(14.4)
Six months to Dec 2018
(435.3)
(185.9)
(119.1)
(130.3)
(9.1)
Six months to June 2018
(400.0)
(145.1)
(125.6)
(129.3)
(10.5)
Exploration, feasibility
Six months to June 2019
–
–
–
–
(23.3)
and evaluation costs
Six months to Dec 2018
–
–
–
–
(40.2)
Six months to June 2018
–
–
–
–
(37.6)
Non-sustaining capital
Six months to June 2019
–
–
–
–
(64.9)
expenditure
Six months to Dec 2018
–
–
–
–
(68.3)
Six months to June 2018
–
–
–
–
(78.8)
Total all-in cost
Six months to June 2019
(447.4)
(184.6)
(142.9)
(119.9)
(102.5)
Six months to Dec 2018
(435.3)
(185.9)
(119.1)
(130.3)
(117.7)
Six months to June 2018
(400.0)
(145.1)
(125.6)
(129.3)
(126.9)
Total all-in sustaining cost
Six months to June 2019
(447.4)
(184.6)
(142.9)
(119.9)
(14.4)
Six months to Dec 2018
(435.3)
(185.9)
(119.1)
(130.3)
(9.1)
Six months to June 2018
(400.0)
(145.1)
(125.6)
(129.3)
(10.5)
Gold only ounces sold
Six months to June 2019
432.5
183.2
115.4
133.9
–
– (000 ounces)
Six months to Dec 2018
441.6
176.8
121.6
143.2
–
Six months to June 2018
444.3
190.2
116.9
137.3
–
AISC per ounce of gold sold
Six months to June 2019
1,035
1,008
1,238
895
–
US$/oz
Six months to Dec 2018
986
1,052
979
910
–
Six months to June 2018
900
763
1,075
942
–
Total all-in cost
Six months to June 2019
(447.4)
(184.6)
(142.9)
(119.9)
(102.5)
Six months to Dec 2018
(435.3)
(185.9)
(119.1)
(130.3)
(117.7)
Six months to June 2018
(400.0)
(145.1)
(125.6)
(129.3)
(126.9)
Gold only ounces sold
Six months to June 2019
432.5
183.2
115.4
133.9
–
– (000 ounces)
Six months to Dec 2018
441.6
176.8
121.6
143.2
–
Six months to June 2018
444.3
190.2
116.9
137.3
–
AIC per ounce of gold sold
Six months to June 2019
1,035
1,008
1,238
895
–
US$/oz
Six months to Dec 2018
986
1,052
979
910
–
Six months to June 2018
900
763
1,075
942
–
33
Gold Fields 2019 H1 RESULTS
ALL-IN SUSTAINING COSTS AND ALL-IN COSTS GROSS OF BY-PRODUCT
CREDITS PER EQUIVALENT OUNCE OF GOLD SOLD (Original
interpretation)
World Gold Council Industry Standard
United States Dollars
Figures in millions
unless otherwise stated
Total
Group
Including
Equity
Accounted
Joint
Venture
Total
Mine
Operations
Including
Equity
Accounted
Joint Venture
Total
Mine
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
Six months to June 2019
(1,012.8)
(998.4)
(936.2)
(137.8)
(389.7)
(254.6)
(72.8)
(62.2)
(23.6)
(per table on page 31)
Six months to Dec 2018
(983.8)
(975.0)
(925.8)
(142.4)
(368.5)
(246.9)
(72.7)
(49.1)
(28.7)
Six months to June 2018
(925.1)
(914.6)
(914.6)
(177.0)
(326.5)
(252.0)
(74.3)
–
(11.1)
Add back by-product
Six months to June 2019
(87.3)
(87.3)
(87.1)
(0.1)
(1.1)
(0.9)
(0.1)
(0.2)
(85.6)
credits
Six months to Dec 2018
(84.7)
(84.7)
(84.5)
(0.1)
(0.8)
(0.5)
(0.2)
(0.2)
(83.3)
Six months to June 2018
(86.7)
(86.7)
(86.7)
(0.2)
(0.2)
(0.2)
–
–
(85.9)
All-in sustaining costs
Six months to June 2019
(1,100.1)
(1,085.7)
(1,023.3)
(138.0)
(390.8)
(255.4)
(72.9)
(62.4)
(109.2)
gross of by-product
Six months to Dec 2018
(1,068.4)
(1,059.7)
(1,010.3)
(142.5)
(369.3)
(247.3)
(72.8)
(49.3)
(112.0)
credits
Six months to June 2018
(1,011.9)
(1,001.3)
(1,001.3)
(177.2)
(326.7)
(252.3)
(74.3)
–
(97.0)
Gold equivalent
Six months to June 2019
1,115.7
1,115.7
1,061.8
90.1
436.6
270.9
111.8
53.9
156.4
ounces sold
Six months to Dec 2018
1,070.5
1,070.5
1,024.6
63.6
397.7
260.5
91.3
45.9
167.4
Six months to June 2018
1,034.0
1,034.0
1,034.0
104.2
353.9
264.4
89.5
–
131.7
AISC gross of by-product Six months to June 2019
986
973
964
1,530
895
943
652
1,158
698
credits per equivalent
Six months to Dec 2018
998
990
986
2,241
929
950
797
1,073
669
ounce of gold – US$/eq oz Six months to June 2018
979
968
968
1,701
923
954
829
–
737
All-in costs
Six months to June 2019
(1,151.0)
(1,048.5)
(981.9)
(137.8)
(439.7)
(254.6)
(118.6)
(66.5)
(23.6)
(per table on page 31)
Six months to Dec 2018
(1,161.2)
(1,043.7)
(989.9)
(148.5)
(431.2)
(246.9)
(130.4)
(54.0)
(28.7)
Six months to June 2018
(1,121.4)
(994.4)
(994.4)
(189.2)
(394.1)
(252.0)
(141.9)
–
(11.1)
Add back by-product
Six months to June 2019
(87.3)
(87.3)
(87.1)
(0.1)
(1.1)
(0.9)
(0.1)
(0.2)
(85.6)
credits
Six months to Dec 2018
(84.7)
(84.7)
(84.5)
(0.1)
(0.8)
(0.5)
(0.2)
(0.2)
(83.3)
Six months to June 2018
(86.7)
(86.7)
(86.7)
(0.2)
(0.2)
(0.2)
–
–
(85.9)
All-in costs gross of
Six months to June 2019
(1,238.3)
(1,135.8)
(1,069.0)
(138.0)
(440.8)
(255.4)
(118.6)
(66.7)
(109.1)
by-product credits
Six months to Dec 2018
(1,245.9)
(1,128.4)
(1,074.2)
(148.6)
(432.0)
(247.3)
(130.6)
(54.2)
(111.9)
Six months to June 2018
(1,208.1)
(1,081.1)
(1,081.1)
(189.4)
(394.3)
(252.3)
(141.9)
–
(97.0)
Gold equivalent
Six months to June 2019
1,115.7
1,115.7
1,061.8
90.1
436.6
270.9
111.8
53.9
156.4
ounces sold
Six months to Dec 2018
1,070.5
1,070.5
1,024.6
63.6
397.7
260.4
91.3
45.9
167.4
Six months to June 2018
1,034.0
1,034.0
1,034.0
104.2
353.9
264.4
89.5
–
131.7
AIC gross of by-product Six months to June 2019
1,110
1,018
1,007
1,530
1,010
943
1,061
1,238
698
credits per equivalent
Six months to Dec 2018
1,164
1,054
1,048
2,337
1,086
950
1,431
1,179
669
ounce of gold – US$/eq oz Six months to June 2018
1,168
1,168
1,046
1,818
1,114
954
1,585
–
737
United States Dollars
Figures in millions
unless otherwise stated
Total
Australia
Region
Corporate
and
projects
Australia
St Ives
Agnew
Granny
Smith
All-in sustaining costs
Six months to June 2019
(447.4)
(184.6)
(142.9)
(119.9)
(14.4)
(per table on page 32)
Six months to Dec 2018
(435.3)
(185.9)
(119.1)
(130.3)
(9.1)
Six months to June 2018
(400.0)
(145.1)
(125.6)
(129.3)
(10.5)
Add back by-product credits Six months to June 2019
(0.5)
(0.3)
(0.1)
(0.1)
–
Six months to Dec 2018
(0.5)
(0.3)
(0.2)
–
–
Six months to June 2018
(0.4)
(0.2)
(0.1)
(0.1)
–
All-in sustaining costs gross Six months to June 2019
(447.9)
(184.9)
(143.0)
(120.0)
(14.4)
of by-product credits
Six months to Dec 2018
(435.7)
(186.2)
(119.3)
(130.3)
(9.1)
Six months to June 2018
(400.4)
(145.3)
(125.7)
(129.4)
(10.5)
Gold equivalent ounces sold Six months to June 2019
432.5
183.2
115.4
133.9
–
Six months to Dec 2018
441.6
176.8
121.6
143.2
–
Six months to June 2018
444.3
190.2
116.9
137.3
–
AISC gross of by-product Six months to June 2019
1,036
1,009
1,239
896
–
credits per equivalent
Six months to Dec 2018
987
1,053
981
910
–
ounce of gold – US$/eq oz
Six months to June 2018
901
764
1,076
942
–
All-in costs
Six months to June 2019
(447.4)
(184.6)
(142.9)
(119.9)
(102.5)
(per table on page 32)
Six months to Dec 2018
(435.3)
(185.9)
(119.3)
(130.3)
(117.7)
Six months to June 2018
(400.0)
(145.1)
(125.6)
(129.3)
(126.9)
Add back by-product
Six months to June 2019
(0.5)
(0.3)
(0.1)
(0.1)
–
credits
Six months to Dec 2018
(0.5)
(0.3)
(0.2)
–
–
Six months to June 2018
(0.4)
(0.2)
(0.1)
(0.1)
–
All-in costs gross of
Six months to June 2019
(447.9)
(184.9)
(143.0)
(119.9)
(102.5)
by-product credits
Six months to Dec 2018
(435.7)
(186.2)
(119.3)
(130.3)
(117.9)
Six months to June 2018
(400.4)
(145.3)
(125.7)
(129.4)
(126.9)
Gold equivalent ounces sold Six months to June 2019
432.5
183.2
115.4
133.9
–
Six months to Dec 2018
441.6
176.8
121.6
143.2
–
Six months to June 2018
444.3
190.2
116.9
137.3
–
AIC gross of by-product
Six months to June 2019
1,036
1,009
1,239
896
–
credits per equivalent
Six months to Dec 2018
987
1,053
981
910
–
ounce of gold – US$/eq oz
Six months to June 2018
901
764
1,076
942
–
Gold Fields 2019 H1 RESULTS
34
35
Gold Fields 2019 H1 RESULTS
UNDERGROUND AND SURFACE
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
South
Africa
Region
West
Africa
Region
South
America
Region
Australia
Region
Ghana
Peru
Australia
South
Deep
Total
Tarkwa
Damang
Asanko
45%
Cerro
Corona
Total
St Ives
Agnew
Granny
Smith
Gruyere
50%
Tonnes mined (000 tonnes)
– underground Six months to June 2019
2,490
2,490
430
–
–
–
–
–
2,060
646
591
824
–
ore
Six months to Dec 2018
2,460
2,460
339
–
–
–
–
–
2,121
598
599
923
–
Six months to June 2018
2,259
2,259
497
–
–
–
–
–
1,762
313
617
832
–
– underground Six months to June 2019
1,212
1,212
52
–
–
–
–
–
1,160
464
398
298
–
waste
Six months to Dec 2018
888
888
59
–
–
–
–
–
829
219
353
257
–
Six months to June 2018
1,087
1,087
142
–
–
–
–
–
945
248
386
311
–
– surface ore
Six months to June 2019
18,491
17,339
–
11,862
8,013
2,697
1,152
3,681
2,948
1,718
–
–
1,230
Six months to Dec 2018
15,759
114,618
–
11,358
7,473
2,744
1,14
3,560
841
841
–
–
–
Six months to June 2018
14,303
14,303
–
8,454
6,703
1,751
–
3,294
2,555
2,555
–
–
–
– total
Six months to June 2019
22,193
21,041
482
11,862
8,013
2,697
1,152
3,681
6,168
2,828
989
1,122
1,230
Six months to Dec 2018
19,106
17,965
397
11,358
7,473
2,744
1,141
3,560
3,791
1,658
952
1,180
–
Six months to June 2018
17,646
17,646
639
8,454
6,703
1,751
–
3,294
5,262
3,116
1,003
1,143
–
Grade mined (grams per tonne)
– underground Six months to June 2019
5.4
5.4
6.3
–
–
–
–
–
5.2
4.0
6.2
5.5
–
ore
Six months to Dec 2018
5.3
5.3
6.0
–
–
–
–
–
5.2
3.8
6.7
5.0
–
Six months to June 2018
5.9
5.9
6.2
–
–
–
–
–
5.6
4.5
6.3
5.5
–
– surface ore
Six months to June 2019
1.3
1.3
–
1.3
1.2
1.6
1.5
1.1
1.3
1.7
–
–
0.8
Six months to Dec 2018
1.4
1.3
–
1.3
1.2
1.6
1.5
1.2
2.0
2.0
–
–
–
Six months to June 2018
1.6
1.6
–
1.4
1.3
1.8
–
0.9
2.9
2.9
–
–
–
– total
Six months to June 2019
1.8
1.8
5.6
1.3
1.2
1.6
1.5
1.1
2.9
2.3
6.2
5.5
0.8
Six months to Dec 2018
1.9
1.9
5.2
1.3
1.2
1.6
1.5
1.2
4.3
2.8
6.7
5.0
–
Six months to June 2018
2.2
2.2
5.0
1.4
1.3
1.8
–
0.9
4.0
3.1
6.3
5.5
–
Gold mined (000 ounces)
– underground Six months to June 2019
433.0
433.0
86.6
–
–
–
–
–
346.4
84.0
117.9
144.5
–
ore
Six months to Dec 2018
416.8
416.8
63.6
–
–
–
–
–
353.2
73.8
129.7
149.7
–
Six months to June 2018
414.6
414.6
98.7
–
–
–
–
–
315.9
45.6
124.0
146.3
–
– surface ore
Six months to June 2019
769.2
714.3
–
512.7
320.9
136.9
54.8
130.5
125.9
93.6
–
–
32.3
Six months to Dec 2018
687.8
633.8
1.0
489.1
293.6
141.5
54.0
143.0
54.7
54.7
–
–
–
Six months to June 2018
708.4
708.4
0.3
379.4
278.5
100.8
–
90.8
237.9
237.9
–
–
–
– total
Six months to June 2019
1,202.2
1,147.3
86.6
512.7
320.9
136.9
54.8
130.5
472.3
177.6
117.9
144.5
32.3
Six months to Dec 2018
1,104.5
1,050.5
64.6
489.7
293.6
141.5
54.0
143.0
407.9
128.5
129.7
149.7
–
Six months to June 2018
1,123.1
1,123.1
99.0
379.4
278.5
100.8
–
90.8
553.8
283.5
124.0
146.3
–
Ore milled/treated (000 tonnes)
– underground Six months to June 2019
2,546
2,546
435
–
–
–
–
–
2,110
707
586
818
–
ore
Six months to Dec 2018
2,284
2,284
259
–
–
–
–
–
2,025
493
590
942
–
Six months to June 2018
2,280
2,280
569
–
–
–
–
–
1,711
288
588
836
–
– underground Six months to June 2019
44
44
44
–
–
–
–
–
–
–
–
–
–
waste
Six months to Dec 2018
118
118
118
–
–
–
–
–
–
–
–
–
–
Six months to June 2018
92
92
92
–
–
–
–
–
–
–
–
–
–
– surface ore
Six months to June 2019
15,384
14,214
61
10,372
6,886
2,317
1,169
3,348
1,602
1,544
–
–
58
Six months to Dec 2018
15,021
14,079
143
9,900
6,907
2,049
944
3,314
1,663
1,663
–
–
–
Six months to June 2018
14,314
14,314
139
9,040
6,884
2,156
–
3,330
1,806
1,806
–
–
–
– total
Six months to June 2019
17,973
16,804
540
10,372
6,886
2,317
1,169
3,348
3,713
2,251
586
818
58
Six months to Dec 2018
17,424
16,480
520
9,900
6,907
2,049
944
3,314
3,690
2,158
590
942
–
Six months to June 2018
16,686
16,686
800
9,040
6,884
2,156
–
3,330
3,517
2,093
588
836
–
Yield (grams per tonne)
– underground Six months to June 2019
5.2
5.2
6.5
–
–
–
–
–
5.0
3.9
6.0
5.1
–
ore
Six months to Dec 2018
5.0
2.9
7.2
–
–
–
–
–
2.4
3.7
0.7
4.7
–
Six months to June 2018
6.1
6.1
5.2
–
–
–
–
–
6.9
4.2
6.1
9.9
–
– surface ore
Six months to June 2019
1.4
1.4
0.3
1.3
1.2
1.5
1.5
1.5
1.9
2.0
–
–
–
Six months to Dec 2018
1.4
1.5
0.2
1.3
1.2
1.4
1.5
1.7
2.2
2.2
–
–
–
Six months to June 2018
1.4
1.4
0.1
1.2
1.2
1.3
–
1.3
2.6
2.6
–
–
–
– combined
Six months to June 2019
1.9
2.0
5.3
1.3
1.2
1.5
1.5
1.5
3.6
2.6
6.0
5.1
–
Six months to Dec 2018
1.9
1.9
3.6
1.3
1.2
1.4
1.5
1.7
3.7
2.6
6.5
4.7
–
Six months to June 2018
1.9
1.9
3.8
1.2
1.2
1.3
–
1.3
3.9
2.8
6.1
5.1
–
Gold produced (000 ounces)
– underground Six months to June 2019
427.2
427.2
91.0
–
–
–
–
–
336.2
88.9
113.3
134.0
–
ore
Six months to Dec 2018
385.0
385.0
59.9
–
–
–
–
–
325.2
58.2
123.7
143.2
–
Six months to June 2018
387.1
387.1
95.9
–
–
–
–
–
291.1
38.5
115.4
137.2
–
– surface ore
Six months to June 2019
694.2
639.1
0.6
437.8
270.9
111.8
55.1
157.1
98.7
98.7
–
–
–
Six months to Dec 2018
692.4
647.9
0.7
396.3
260.5
91.3
44.5
176.5
118.9
118.9
–
–
–
Six months to June 2018
643.4
643.4
0.6
353.9
264.4
89.5
–
137.6
151.3
151.3
–
–
–
– total
Six months to June 2019
1,121.5
1,066.3
91.7
437.8
270.9
111.8
55.1
157.1
434.9
134.0
187.6
113.3
–
Six months to Dec 2018
1,077.4
1,032.9
60.6
396.3
260.5
91.3
44.5
176.5
444.0
177.1
123.7
143.2
–
Six months to June 2018
1,030.4
1,030.4
96.5
353.9
264.4
89.5
–
137.6
442.4
189.8
115.4
137.2
–
Cost of sales before gold inventory
change and amortisation and
depreciation (dollar per tonne)
– underground Six months to June 2019
130
130
247
–
–
–
–
–
104
88
136
94
–
Six months to Dec 2018
128
128
313
–
–
–
–
–
93
50
130
93
–
Six months to June 2018
151
151
228
–
–
–
–
–
113
107
138
97
–
– surface
Six months to June 2019
26
26
4
27
25
28
36
24
30
30
–
–
–
Six months to Dec 2018
28
28
1
26
23
30
44
23
50
50
–
–
–
Six months to June 2018
25
25
1
23
20
32
–
23
42
42
–
–
–
– total
Six months to June 2019
41
42
219
27
25
36
24
71
48
136
94
–
Six months to Dec 2018
42
42
214
28
23
37
44
25
70
44
133
91
–
Six months to June 2018
42
42
188
23
20
32
–
23
76
51
138
97
–
36
Gold Fields 2018 H1 RESULTS
Review of Operations
Quarter ended 30 June 2019 compared
with quarter ended 31 March 2019
South Africa region
South Deep
June
2019
March
2019
Gold produced
000’oz
57.3
34.3
kg
1,782
1,069
Gold sold
000’oz
58.6
31.6
kg
1,822
982
Yield – underground reef
g/t
6.60
6.34
AISC– original interpretation
R/kg
590,492
900,408
US$/oz
1,275
1,992
AISC – revised interpretation
guidance (WGC November
2018) R/kg
590,492
900,408
US$/oz
1,275
1,992
AIC
R/kg
590,492
900,408
US$/oz
1,275
1,992
Regrettably, on 2 June 2019 a seismic related face ejection
resulted in fatally injuring Mrs. Maria Ramela. In conjunction with
the DMR, the mine has conducted investigations into the accident
in order to implement measures to reduce the risk of similar events
reoccurring. Face support (mesh) has been implemented as an
immediate measure.
The mine continued its recovery after the December quarter 2018
industrial action and improvements process started to deliver. The
mine consequently realised advances in performance measures.
Gold production increased by 67 per cent from 1,069 kilograms
(34,353 ounces) in the March quarter to 1,782 kilograms (57,306
ounces) in the June quarter and production performance was in
line with plan supporting production guidance for the year.
Total underground tonnes mined increased by 28 per cent from
211,600 tonnes in the March quarter to 270,100 tonnes in the June
quarter. Ore tonnes mined increased by 44 per cent from 176,000
tonnes to 253,700 tonnes, while underground waste mined
decreased by 54 per cent from 35,600 tonnes to 16,400 tonnes.
Underground reef grade mined increased by 1 per cent from 6.24
grams per tonne to 6.29 grams per tonne due to a greater portion
of mining in the higher grade proximal areas. Total gold mined from
underground increased by 45 per cent from 1,099 kilograms
(35,300 ounces) in the March quarter to 1,596 kilograms (51,300
ounces) in the June quarter.
Total tonnes milled increased by 9 per cent from 258,800 tonnes in
the March quarter to 281,500 tonnes in the June quarter.
Underground reef tonnes milled increased by 62 per cent from
166,000 tonnes in the March quarter to 269,000 tonnes in the June
quarter. Reef yield increased by 4 per cent from 6.34 grams per
tonne to 6.60 grams per tonne following the mining grade
improvement as described above. The proportional variance
between the increase in reef grade mined and reef yield, can
partially be attributed to the loading and processing of previously
mined ore at a higher grade than the average mined in this period.
Surface tailings material treated decreased by 98 per cent from
59,600 tonnes to 1,400 tonnes mainly due to the treatment of
surface tailing material being halted to increase the backfill
availability by sending tailings directly to backfill plant.
Gold recovered from underground amounted to 1,777 kilograms
(57,133 ounces). In addition, 5 kilograms (174 ounces) were
recovered from the treatment of surface material.
Destress mining increased by 63 per cent from 3,881 square
metres in the March quarter to 6,310 square metres in the June
quarter. This improvement was due to enhanced operational
performance and an increase in the number of destress cuts
available. Application of shotcrete in the destress cuts has
improved conditions and in time will reduce support rehabilitation
requirements.
Longhole stoping increased by 34 per cent from 102,500 tonnes to
137,500 tonnes. Development decreased by 1 per cent from 1,139
metres in the March quarter to 1,133 metres in the June quarter.
Development in the current mine areas decreased by 43 per cent
from 458 metres in the March quarter to 261 metres in the June
quarter due to mining resources being allocated to develop the
North of Wrench, in line with the increased focus on North of
Wrench and the need to access new cuts required to sustain
production in 2020 and beyond. Development North of Wrench
increased by 28 per cent from 681 metres in the March quarter to
872 metres in the June quarter in line with the strategy to build up
North of Wrench.
The current mine contributed 45 per cent of the total ore tonnes in
the June quarter compared with 55 per cent of the total ore tonnes
in the March quarter. The North of Wrench contributed 55 per cent
of the total ore tonnes in the June quarter compared with 45 per
cent in the March quarter. The tonnage contribution from longhole
stoping increased by 3 per cent from 48 per cent in the March
quarter to 51 per cent in the June quarter.
Cost of sales before amortisation and depreciation increased by 27
per cent from R734 million (US$52 million) to R935 million (US$65
million). Cost of sales before gold inventory change and
amortisation and depreciation increased by 14 per cent from R788
million (US$56 million) in the March quarter to R898 million (US$62
million) in the June quarter mainly due to higher salaries and wages
due to annual increases awarded in March 2019, increased utilities
and contractors and consumable costs in the June quarter due to
increased production. This was compounded by a gold-in-process
charge to cost of R37 million (US$3 million) in the June quarter
compared with a credit of R54 million (US$4 million) in the March
quarter. The net gold-in-process movement was R91 million (US$7
million).
Capital expenditure decreased by 9 per cent from R131 million
(US$9 million) in the March quarter to R119 million (US$8 million)
in the June quarter.
Sustaining capital expenditure decreased by 9 per cent from R131
million (US$9 million) in the March quarter to R119 million (US$8
million) in the June quarter due to a decrease in major component
and rebuild costs for the mine’s fleet. No growth capital
expenditure was incurred for the March and June 2019 quarters in
line with the operational plan.
All-in sustaining costs and all-in costs decreased by 34 per cent
from R900,408 per kilogram (US$1,992 per ounce) in the March
quarter to R590,492 per kilogram (US$1,275 per ounce) in the
June quarter mainly due to higher gold sold, lower sustaining
capital expenditure, partially offset by higher cost of sales before
amortisation and depreciation.
37
Gold Fields 2019 H1 RESULTS
West Africa region
Ghana
Tarkwa
June
2019
March
2019
Gold produced
000’oz
134.2
136.7
Gold sold
000’oz
134.2
136.7
Yield
g/t
1.21
1.23
AISC – original interpretation
US$/oz
958
922
AISC – revised interpretation
guidance (WGC November
2018)
US$/oz
958
922
AIC
US$/oz
958
922
Gold production decreased by 2 per cent from 136,700 ounces in
the March quarter to 134,200 ounces in the June quarter mainly
due lower head grade processed.
Total tonnes mined, including capital waste stripping, decreased by
6 per cent from 25.0 million tonnes in the March quarter to 23.4
million tonnes in the June quarter. Ore tonnes mined decreased
by 2 per cent from 4.1 million tonnes to 4.0 million tonnes.
Operational waste tonnes mined increased by 28 per cent from 9.0
million tonnes to 11.5 million tonnes due to higher operational
waste stripping required to expose ore in line with the mining plan.
Capital waste tonnes mined decreased by 32 per cent from 11.9
million tonnes to 7.9 million tonnes. Mined grade increased by 1
per cent from 1.24 grams per tonne to 1.25 grams per tonne. Gold
mined decreased by 2 per cent from 161,900 ounces to 159,000
ounces as a result of decreased ore tonnes mined. The strip ratio
decreased from 5.2 to 4.9.
The CIL plant throughput was similar at 3.4 million tonnes
.
Yield
decreased by 2 per cent from 1.23 grams per tonne to 1.21 grams
per tonne mainly due to lower grade feed.
Cost of sales before amortisation and depreciation increased by 23
per cent from US$71 million to US$87 million mainly due to 28 per
cent higher operational tonnes mined and a lower gold-in-process
credit to cost of US$5 million in the June quarter compared with a
credit to cost of US$9 million in the March quarter.
Capital expenditure decreased by 23 per cent from US$39 million
to US$30 million due to lower capital waste stripping.
All-in sustaining costs and total all-in cost increased by 4 per cent
from US$922 per ounce in the March quarter to US$958 per ounce
in the June quarter due to lower gold sold and higher cost of sales
before amortisation and depreciation partially offset by lower
capital expenditure.
Damang
June
2019
March
2019
Gold produced
000’oz
54.6
57.2
Gold sold
000’oz
54.6
57.2
Yield
g/t
1.46
1.54
AISC – original interpretation
US$/oz
673
633
AISC – revised interpretation
guidance (WGC November
2018)
US$/oz
673
633
AIC
US$/oz
1,097
1,027
Gold production decreased by 5 per cent from 57,200 ounces in
the March quarter to 54,600 ounces in the June quarter mainly due
to lower yield.
Total tonnes mined, including capital stripping, decreased by 3 per
cent from 8.7 million tonnes in the March quarter to 8.4 million
tonnes in the June quarter due to the reduction in the planned
tonnes for 2019, in line with the mining sequence, as the Amoanda
pit comes to completion.
Ore tonnes mined, decreased by 1 per cent from 1.36 million
tonnes in the March quarter to 1.34 million tonnes in the June
quarter. Total waste tonnes mined decreased by 3 per cent from
7.3 million tonnes to 7.1 million tonnes due to the Amoanda pit
getting deeper and the associated operational constraints, grade
control drilling in the Saddle pit and less capital waste mined at
DPCB in line with the plan. Capital waste tonnes included in total
waste tonnes decreased by 2 per cent from 5.9 million tonnes to
5.8 million tonnes in line with the operational plan. Operational
waste tonnes mined decreased by 7 per cent from 1.4 million
tonnes to 1.3 million tonnes due to the Amoanda pit getting deeper
and the associated operational constraints and grade control
drilling in the Saddle pit. In the June quarter total tonnes mined at
Amoanda pit were 0.8 million tonnes, at Saddle 1.3 million tonnes
and at DPCB 6.3 million tonnes.
Head grade mined decreased by 1 per cent from 1.59 grams per
tonne to 1.57 grams per tonne due to lower grade material mined
from Saddle pit, in accordance with the mining sequence. Gold
mined decreased by 3 per cent from 69,400 ounces to 67,500
ounces. The strip ratio decreased from 5.4 to 5.3 due to lower strip
ratio areas at the Saddle and Amoanda pits.
Tonnes processed increased by 2 per cent from 1.15 million tonnes
in the March quarter to 1.17 million tonnes in the June quarter due
to higher plant overall equipment effectiveness. Yield decreased
by 5 per cent from 1.54 grams per tonne to 1.46 grams per tonne
due to lower feed grade. In the June quarter, tonnes milled were
sourced as follows: 0.96 million tonnes at 1.68 grams per tonne
from the pits and 0.21 million tonnes at 1.53 grams per tonne from
stockpiles. This compared with 0.96 million tonnes at 1.65 grams
per tonne from the pits and 0.19 million tonnes at 2.07 grams per
tonne from high grade stockpiles in the March quarter.
Cost of sales before amortisation and depreciation increased by 7
per cent from US$28 million in the March quarter to US$30 million
in the June quarter, mainly due to a lower gold-in-process credit.
Capital expenditure was similar at US$25 million.
Sustaining capital expenditure was similar at US$2 million. Non-
sustaining capital expenditure was similar at US$23 million.
All-in sustaining costs increased by 6 per cent from US$633 per
ounce in the March quarter to US$673 per ounce in the June
quarter mainly due to lower gold sold and higher cost of sales
before amortisation and depreciation.
All-in costs increased by 7 per cent from US$1,027 per ounce in
the March quarter to US$1,097 per ounce in the June quarter due
to the same reasons above.
At the end of the June 2019 quarter, and 30 months into the
Damang Reinvestment Project (DRP), total material mined
amounted to 103 million tonnes, 19 per cent ahead of the project
schedule. Gold produced during the same period was 436,185
ounces, 27 per cent above the DRP ounces of 344,332. The
project capital spent to date is US$320 million versus the original
DRP budget to date of US$275 million, largely driven by the
additional capital waste tonnes mined.
Gold Fields 2019 H1 RESULTS
38
Asanko (Equity accounted Joint Venture)
June
2019
March
2019
Gold produced
000’oz
62.1
60.4
Gold sold
000’oz
66.3
53.4
Yield
g/t
1.39
1.47
AISC – original interpretation
US$/oz
1,180
1,123
AISC – revised interpretation
guidance (WGC November
2018)
US$/oz
1,180
1,123
AIC
US$/oz
1,247
1,219
Gold production increased by 3 per cent from 60,400 ounces in the
March quarter to 62,100 ounces in the June quarter.
Total tonnes mined increased by 10 per cent from 8.1 million
tonnes in the March quarter to 8.9 million tonnes in the June
quarter. Ore tonnes mined decreased by 27 per cent from 1.5
million tonnes in the March quarter to 1.1 million tonnes in the June
quarter. Head grade mined increased by 8 per cent from 1.43
grams per tonne in the March quarter to 1.55 grams per tonne in
the June quarter.
Total waste tonnes mined increased by 18 per cent from 6.6 million
tonnes in the March quarter to 7.8 million tonnes in the June
quarter. The strip ratio increased by 68 per cent from 4.4 in the
March quarter to 7.4 in the June quarter. The increase in strip ratio
and waste tonnes mined in the June quarter was due to the final
stages of waste mining from the Cut 2 pushback at Nkran, which is
expected to be complete in the September quarter 2019.
The plant throughput increased by 17 per cent from 1.2 million
tonnes to 1.4 million tonnes. Yield decreased by 5 per cent from
1.47 grams per tonne in the March quarter to 1.39 grams per tonne
in the June quarter. In the June quarter total tonnes processed
exceeded the ore tonnes mined and therefore 12 per cent of the
total tonnes processed (167,000 tonnes) were fed from the ROM
stockpile at an average grade of 0.9 grams per tonne resulting in
the 5 per cent yield decrease. In the March quarter, the majority of
the tonnes processed were fed from the ore tonnes mined.
Gold Fields’ 45 per cent share of gold produced and gold sold
amounted to 27,900 ounces and 29,900 ounces for the June
quarter, respectively and 27,200 ounces and 24,000 ounces for the
March quarter.
Cost of sales before amortisation and depreciation increased by 2
per cent from US$46 million in the March quarter to US$47 million
in the June quarter.
Capital expenditure increased from US$8 million in the March
quarter to US$28 million in the June quarter and included deferred
stripping of US$3 million and US$20 million, respectively. Capital
expenditure increased by US$20 million due to an increase in
deferred stripping as a result of the Cut 2 pushback at Nkran and
US$4 million spent on TSF lift 4.
Sustaining capital increased from US$4 million in the March quarter
to US$24 million in the June quarter. Non-sustaining capital was
similar at US$4 million.
Gold Fields share of cost of sales before amortisation and
depreciation was similar at US$21 million. Gold Fields share of
sustaining capital increased by 450 per cent from US$2 million in
the March quarter to US$11 million in the June quarter. Gold Fields
share of non-sustaining capital was similar at US$2 million.
All-in sustaining costs increased by 5 per cent from US$1,123 per
ounce in the March quarter to US$1,180 per ounce in the June
quarter mainly due to higher sustaining capital expenditure and
higher cost of sales before amortisation and depreciation, partially
offset by higher gold sold.
All-in costs increased by 2 per cent from US$1,219 per ounce in
the March quarter to US$1,247 per ounce in the June quarter due
to the same reasons above.
South America region
Peru
Cerro Corona
June
2019
March
2019
Gold produced
000’oz
40.9
39.9
Copper produced
tonnes
8,357
7,764
Total equivalent gold produced
000’eq oz
80.3
76.8
Total equivalent gold sold
000’eq oz
76.9
79.6
Yield
– gold
g/t
0.80
0.76
– copper
per
cent
0.53
0.48
– combined
eq g/t
1.51
1.41
AISC – original interpretation
US$/oz
381
203
AISC
US$/eq oz
719
677
AISC – revised interpretation
guidance (WGC November
2018)
US$/oz
364
168
US$/eq oz
710
659
AIC
US$/oz
381
203
AIC
US$/eq oz
719
677
Gold price*
US$/oz
1,301
1,301
Copper price*
US$/t
6,146
6,184
*
Average daily spot price for the period used to calculate total equivalent gold ounces
produced.
Gold production increased by 3 per cent from 39,900 ounces in the
March quarter to 40,900 ounces in the June quarter due to higher
grades mined and processed, partially offset by lower recovery.
Copper production increased by 8 per cent from 7,764 tonnes to
8,357 tonnes due to higher grade mined and processed.
Equivalent gold production increased by 5 per cent from 76,800
ounces to 80,300 ounces mainly due to higher grade processed in
line with the mining sequence.
Gold head grade increased by 8 per cent from 1.13 grams per
tonne to 1.22 grams per tonne and gold recoveries decreased from
67.3 per cent to 65.7 per cent, in line with the mining sequence.
Copper head grade increased by 9 per cent from 0.54 per cent to
0.59 per cent in line with the mining sequence and copper
recoveries increased from 89.0 per cent to 89.5 per cent. As a
result of the above, gold yield increased by 5 per cent from 0.76
grams per tonne to 0.80 grams per tonne. Copper yield increased
by 10 per cent from 0.48 per cent to 0.53 per cent.
In the June quarter, concentrate with a payable content of 39,901
ounces of gold was sold at an average price of US$1,292 per
ounce and 8,017 tonnes of copper was sold at an average price of
US$5,289 per tonne, net of treatment and refining charges. This
compared with 41,413 ounces of gold that was sold at an average
price of US$1,296 per ounce and 7,852 tonnes of copper that was
sold at an average price of US$5,604 per tonne, net of treatment
and refining charges, in the March quarter.
Total tonnes mined increased by 1 per cent from 5.37 million
tonnes in the March quarter to 5.45 million tonnes in the June
quarter mainly due to higher waste mined in line with the mining
sequence and higher efficiency of the new mining contractor. Ore
mined decreased by 8 per cent from 1.92 million tonnes to 1.76
million tonnes. Operational waste tonnes mined increased by 7 per
39
Gold Fields 2019 H1 RESULTS
cent from 3.45 million tonnes to 3.69 million tonnes in line with the
mining plan. The strip ratio increased from 1.80 to 2.10.
Ore processed decreased by 3 per cent from 1.70 million tonnes to
1.65 million tonnes due to lower plant throughput in the June
quarter (817 tonnes per hour in the June quarter versus 823 tonnes
per hour in the March quarter), due to ore characteristics. Plant
utilisation decreased from 94.4 per cent in the March quarter to
92.6 per cent in the June quarter due to the planned plant
maintenance schedule.
Cost of sales before amortisation and depreciation decreased by 7
per cent from US$42 million to US$39 million mainly due to a US$1
million gold-in-process credit to cost in the June quarter compared
with US$1 million charge to cost in the March quarter.
Capital expenditure increased by 43 per cent from US$7 million to
US$10 million due to an increase in construction activities at the
tailings dam and waste storage facilities after the rainy season.
All-in cost per gold ounce increased by 88 per cent from US$203
per ounce in the March quarter to US$381 per ounce in the June
quarter mainly due to higher capital expenditure, lower by-product
credit due to lower copper price received and lower gold sold,
partially offset by lower cost of sales before amortisation and
depreciation. All-in cost per equivalent ounce increased by 6 per
cent from US$677 per equivalent ounce to US$719 per equivalent
ounce due to higher capital expenditure and lower equivalent
ounces sold, partially offset by lower cost of sales before
amortisation and depreciation.
Australia region
St Ives
June
2019
March
2019
Gold produced
000’oz
84.6
103.0
Gold sold
000’oz
90.2
92.9
Yield
– underground
g/t
3.44
4.34
– surface
g/t
1.80
2.19
– combined
g/t
2.28
2.92
AISC – original interpretation
A$/oz
1,468
1,387
US$/oz
1,029
988
AISC – revised interpretation
guidance (WGC November
2018)
A$/oz
1,245
1,189
US$/oz
873
846
AIC
A$/oz
1,468
1,387
US$/oz
1,029
988
Gold production, decreased by 18 per cent from 103,000 ounces
in the March quarter to 84,600 ounces in the June quarter due to
lower grade of ore processed.
Total ore tonnes mined increased by 18 per cent from 1.1 million
tonnes in the March quarter to 1.3 million tonnes in the June
quarter.
Total underground ore tonnes mined decreased by 7 per cent from
334,500 tonnes in the March quarter to 311,200 tonnes in the June
quarter. Gold mined from underground operations decreased by
23 per cent from 47,500 ounces in the March quarter to 36,500
ounces in the June quarter.
At the Hamlet underground operation, mining of the main ore body
is decelerating with mine activities to be concluded by the end of
2019. Simultaneously the Hamlet North ore body is being
developed with first ore expected during the March quarter 2020.
Ore tonnes mined at Hamlet decreased by 35 per cent from 25,700
tonnes in the March quarter to 16,700 tonnes in the June quarter.
Head grade decreased by 5 per cent from 3.09 grams per tonne to
2.93 grams per tonne due to mine sequence and resultant gold
mined decreased by 38 per cent from 2,600 ounces to 1,600
ounces.
Ore tonnes mined at the Invincible underground complex in the
June quarter at 243,900 tonnes was similar to the 244,800 tonnes
mined in the March quarter. Head grade mined decreased by 26
per cent from 5.05 grams per tonne in the June quarter to 3.76
grams per tonne in the March quarter. In the June quarter ore was
sourced from lower grade Drake and Fenton development zones
compared with ore that was sourced from high grade stopes in the
Drake zone in the March quarter. During the second half of 2019
ore will be sourced from high grade Fenton zone stopes. Resultant
gold mined from Invincible underground decreased by 26 per cent
from 39,700 ounces in the March quarter to 29,500 ounces in the
June quarter.
Remnant mining of lower levels at the Cave Rocks underground
mine continued in the June quarter, with 50,600 tonnes mined at
3.35 grams per tonne yielding 5,400 ounces, compared to 64,000
tonnes mined at 2.53 grams per tonne yielding 5,200 ounces in the
March quarter. The crown pillar extraction of Cave Rocks is
planned for the second half of 2019, and is forecast to deliver
203,000 tonnes of ore at 3.5 grams per tonne yielding 22,800
ounces.
Total tonnes mined at the open pits, decreased by 6 per cent from
3.6 million tonnes in the March quarter to 3.4 million tonnes in the
June quarter.
At the open pit operations, ore tonnes mined increased by 25 per
cent from 0.8 million tonnes in the March quarter to 1.0 million
tonnes in the June quarter. Ore was sourced from Neptune and
Invincible open pits in the June quarter.
Grade mined from open pits, decreased by 3 per cent from 1.73
grams per tonne to 1.67 grams per tonne reflecting the lower grade
ore mined from Neptune pit in the June quarter. Gold mined from
the open pits increased by 24 per cent from 41,800 ounces to
51,900 ounces. In the June quarter, tonnes mined were sourced
as follows: 0.6 million tonnes at 1.32 grams per tonne from Neptune
and 0.4 million tonnes at 2.16 grams per tonne from Invincible.
This compared with 0.5 million tonnes at 1.48 grams per tonne from
Neptune and 0.3 million tonnes at 2.09 grams per tonne from
Invincible in the March quarter.
Operational waste tonnes mined decreased by 27 per cent from
1.1 million tonnes in the March quarter to 0.8 million tonnes in the
June quarter and capital waste tonnes mined decreased by 6 per
cent from 1.7 million tonnes to 1.6 million tonnes with lower waste
mining at Neptune stage 5. The strip ratio decreased from 3.8 to
2.5 with lower waste mining at Neptune.
Ounces mined at the total St Ives complex decreased by 1 per cent
from 89,300 ounces in the March quarter to 88,300 ounces in the
June quarter. At the end of the June quarter, stockpiled Neptune
high-grade oxide material amounted to 26,300 ounces (663,200
tonnes at 1.23 grams per tonne), Invincible amounted to 13,500
ounces (191,900 tonnes at 2.91 grams per tonne) and A5
amounted to 7,900 ounces (174,000 tonnes at 1.46 grams per
tonne). This compared with Neptune high-grade oxide material
that amounted to 27,300 ounces (563,000 tonnes at 1.51 grams
per tonne), Invincible that amounted to 5,400 ounces (93,000
tonnes at 1.79 grams per tonne) and A5 that amounted to 7,800
ounces (174,000 tonnes at 1.41 grams per tonne) at the end of the
March quarter. Currently, Lefroy mill can only sustain a 25 per cent
Gold Fields 2019 H1 RESULTS
40
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 increased by 5 per cent from 1.10
million tonnes in the March quarter to 1.15 million tonnes in the
June quarter. Yield decreased by 22 per cent from 2.92 grams per
tonne to 2.28 grams per tonne due to an increased proportion of
lower grade stockpiled material processed.
Cost of sales before amortisation and depreciation was similar at
A$87 million (US$62 million). The gold inventory charge to cost of
A$7 million (US$5 million) in the June quarter compared with a
charge to cost of A$13 million (US$10 million) in the March quarter.
Capital expenditure increased by 6 per cent from A$35 million
(US$25 million) to A$37 million (US$26 million) due to higher
infrastructure spend at the Invincible underground mine in the June
quarter.
All-in cost increased by 6 per cent from A$1,387 per ounce
(US$988 per ounce) in the March quarter to A$1,468 per ounce
(US$1,029 per ounce) in the June quarter due to higher capital
expenditure and lower gold sold.
Agnew
June
2019
March
2019
Gold produced
000’oz
56.4
56.9
Gold sold
000’oz
56.4
59.0
Yield
g/t
5.75
6.30
AISC – original interpretation
A$/oz
1,747
1,760
US$/oz
1,224
1,253
AISC – revised interpretation
guidance (WGC November
2018)
A$/oz
1,402
1,275
US$/oz
983
907
AIC
A$/oz
1,747
1,760
US$/oz
1,224
1,253
Gold production decreased by 1 per cent from 56,900 ounces in
the March quarter to 56,400 ounces in the June quarter mainly due
to lower grades processed.
Ore mined from underground increased by 3 per cent from 291,700
tonnes in the March quarter to 299,100 tonnes in the June quarter.
Head grade mined increased by 6 per cent from 6.04 grams per
tonnes to 6.38 grams per tonne due to higher grade stopes mined
in the Bengal area at Waroonga. Gold mined increased by 8 per
cent from 56,600 ounces in the March quarter to 61,300 ounces in
the June quarter. In the June quarter tonnes mined were sourced
as follows: 168,200 tonnes at 8.2 grams per tonne from Waroonga
and 130,900 tonnes at 4.0 grams per tonne from New Holland.
This compared with 160,200 tonnes at 7.4 grams per tonne from
Waroonga and 131,500 tonnes at 4.4 grams per tonne from New
Holland in the March quarter.
Tonnes processed increased by 8 per cent from 281,000 tonnes in
the March quarter to 304,600 tonnes in the June quarter. The
combined yield decreased by 9 per cent from 6.30 grams per tonne
to 5.75 grams per tonne due to high grade ore mined at Waroonga
in June 2019, only processed late in July 2019.
Cost of sales before amortisation and depreciation decreased by 5
per cent from A$59 million (US$42 million) in the March quarter to
A$56 million (US$39 million) in the June quarter. The decrease
was due to a gold inventory credit to costs of A$2 million (US$2
million) in the June quarter compared with a charge of A$5 million
(US$4 million) in the March quarter, partially offset by higher mining
cost of A$2 million (US$1 million) due to increased ore mined at
Waroonga and increased processing cost of A$1 million (US$1
million) due to increased ore processed in the June quarter.
Capital expenditure decreased by 8 per cent from A$40 million
(US$29 million) to A$37 million (US$26 million) mainly due to lower
expenditure on the new accommodation village in the June quarter
amounting to A$13 million (US$9 million) compared with A$18
million (US$13 million) in the March quarter.
All-in cost decreased by 1 per cent from A$1,760 per ounce
(US$1,253 per ounce) in the March quarter to A$1,747 per ounce
(US$1,225 per ounce) in the June quarter due to lower cost of sales
before amortisation and depreciation and lower capital
expenditure, partially offset by lower gold sold.
Granny Smith
June
2019
March
2019
Gold produced
000’oz
64.7
69.3
Gold sold
000’oz
64.8
69.1
Yield
g/t
4.79
5.42
AISC – original interpretation
A$/oz
1,335
1,204
US$/oz
936
857
AISC – revised interpretation
guidance (WGC November
2018)
A$/oz
1,085
977
US$/oz
760
695
AIC
A$/oz
1,335
1,204
US$/oz
936
857
Gold production decreased by 7 per cent from 69,300 ounces in
the March quarter to 64,700 ounces in the June quarter mainly due
to lower grades processed.
Ore mined from underground increased by 7 per cent from 398,400
tonnes to 425,600 tonnes due to increased ore development in the
June quarter resulting in increased flexibility and availability of
production stoping fronts. Head grade mined decreased by 10 per
cent from 5.76 grams per tonne in the March quarter to 5.16 grams
per tonne in the June quarter in line with the mining sequence. As
a result, overall ounces mined decreased by 4 per cent from 73,800
ounces in the March quarter to 70,700 ounces in the June quarter.
Tonnes processed increased by 5 per cent from 398,100 tonnes in
the March quarter to 419,900 tonnes in the June quarter due to
increased ore availability. The yield decreased by 12 per cent from
5.42 grams per tonne to 4.79 grams per tonne due to lower head
grade mined.
Cost of sales before amortisation and depreciation decreased by 4
per cent from A$55 million (US$39 million) in the March quarter to
A$53 million (US$38 million) in the June quarter.
Capital expenditure increased by 19 per cent from A$21 million
(US$15 million) in the March quarter to A$25 million (US$17
million) in the June quarter due to expenditure on underground
ventilation and paste fill infrastructure of A$2 million (US$2 million),
and increased exploration expenditure of A$2 million (US$1
million).
All-in cost increased by 11 per cent from A$1,204 per ounce
(US$857 per ounce) in the March quarter to A$1,335 per ounce
(US$936 per ounce) in the June quarter due to increased capital
expenditure and lower gold sold, partially offset by lower cost of
sales before amortisation and depreciation.
Gruyere
41
Gold Fields 2019 H1 RESULTS
First gold was poured over the weekend of 29 and 30 June 2019.
The gold was produced from the carbon-in-leach (CIL) and elution
circuits.
With the delivery of first gold, the focus then turned to
commissioning of the final components of the process plant,
particularly the gravity gold circuit and ball mill, which were
completed in July 2019. During the initial stages of ramp up, lower
grade stockpiled ore is being processed to reduce gold losses
associated with lower recoveries anticipated as the plant
operations are stabilised.
Commencement of the operation of the ball mill marked the start of
an anticipated ramp up period of six to seven months. Gruyere is
expected to attain commercial production mid way through the
ramp up period.
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 of A$621 million is A$337 million.
Mining activity continues to schedule with 1.7 million tonnes of ore
at a grade of 0.84 grams per tonne for 46,000 ounces mined in the
June quarter. This compared with 0.8 million tonnes of ore at a
grade of 0.76 grams per tonne for 18,600 ounces mined in the
March quarter. (100 per cent basis).
This resulted in 2.5 million tonnes of ore at a grade of 0.82 grams
per tonne for 64,500 ounces having been mined and stockpiled to
date. (100 per cent basis).
Gold Fields 2019 H1 RESULTS
42
SALIENT FEATURE AND COST BENCHMARKS
Figures in millions
unless otherwise stated
Total
Mine
Operations
Including
Equity
accounted
Joint Venture
Total
Mine
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
June 2019
9,037
8,418
282
5,227
3,441
1,167
619
1,652
Ore milled/treated°
March 2019
8,878
8,328
259
5,146
3,445
1,150
551
1,696
(000 tonnes)
June 2018
8,314
8,314
393
4,524
3,473
1,051
–
1,665
Yield
June 2019
1.9
1.9
6.3
1.3
1.2
1.5
1.4
1.5
(grams per tonne)
March 2019
2.0
2.0
4.1
1.3
1.2
1.5
1.5
1.4
June
2018
2.0
2.0
3.9
1.3
1.2
1.6
–
1.3
Gold produced
June 2019
559.9
532.0
57.3
216.8
134.2
54.6
27.9
80.3
(000 managed equivalent ounces)
March 2019
561.5
534.2
34.3
221.1
136.7
57.2
27.2
76.8
June
2018
523.2
523.2
48.8
186.7
133.1
53.5
–
69.0
Gold sold
June 2019
565.6
535.7
58.6
218.7
134.2
54.6
29.9
76.9
(000 managed equivalent ounces)
March 2019
550.1
526.1
31.6
217.9
136.7
57.2
24.0
79.6
June
2018
522.9
522.9
50.3
186.7
133.1
53.5
–
66.5
Cost of sales before amortisation
June 2019
(379.5)
(358.1)
(65.1)
(138.2)
(86.5)
(30.3)
(21.4)
(38.7)
and depreciation
March 2019
(357.4)
(336.7)
(52.3)
(119.9)
(70.7)
(28.4)
(20.8)
(42.4)
(million)
June 2018
(347.7)
(347.7)
(74.4)
(107.5)
(73.5)
(34.0)
–
(39.6)
Cost of sales before gold inventory
June 2019
42
42
222
27
26
28
32
24
change and amortisation and
March 2019
41
41
217
27
23
29
42
25
depreciation (dollar per tonne)
June 2018
42
42
187
23
19
37
–
23
Sustaining capital
June 2019
(129.5)
(118.4)
(8.3)
(42.3)
(29.7)
(1.5)
(11.0)
&
(9.5)
(million) original interpretation
March 2019
(127.3)
(125.8)
(9.3)
(42.6)
(38.6)
(2.5)
(1.5)
(6.9)
June
2018
(134.4)
(134.4)
(10.6)
(48.0)
(44.4)
(3.6)
–
–
–
(7.0)
Non-sustaining capital
June 2019
(66.3)^
(64.7)^
–
(24.9)
–
(23.2)
#
(1.7)
(million) original interpretation
March 2019
(47.8)^
(46.0)^
–
(24.4)
–
(22.5)
#
(1.8)
June
2018
(39.7)
(39.7)
(7.4)
(32.4)
–
–
(32.4)
#
Total capital expenditure
June 2019
(195.8)^
(183.1)^
(8.3)
(67.2)
(29.7)
(24.7)
(12.7)
(9.5)
(million)
March 2019
(175.1)^
(171.8)^
(9.3)
(66.9)
(38.6)
(25.0)
(3.3)
(6.9)
June
2018
(174.2)
(174.2)
(18.0)
(80.4)
(44.4)
(36.0)
(7.0)
All-in-sustaining costs
June 2019
970
958
1,275
917
958
673
1,180
381
(dollar per ounce) original
March 2019
946
939
1,992
869
922
633
1,123
203
interpretation
June 2018
969
969
1,736
897
955
746
–
316
All-in-sustaining costs
June 2019
895
878
1,275
917
958
673
1,180
364
(dollar per ounce) revised
March 2019
858
845
1,992
869
922
633
1,123
168
interpretation
Total all-in-cost
June 2019
1,096
1,087
1,275
1,032
958
1,097
1,247
381
(dollar per ounce)
March 2019
1,040
1,034
1,992
983
922
1,027
1,219
203
June
2018
1,051
1,051
1,882
1,069
955
1,347
–
316
United States Dollars
Australian Dollars
South African
Rand
Australia
Region
Australia
Region
South Africa
Region
Australia
Australia
Total
St Ives
Agnew
Granny
Smith
Total
St Ives
Agnew
Granny
Smith
South
Deep
Operating Results
June 2019
1,877
1,152
305
420
1,877
1,152 305 420
282
Ore milled/treated
March 2019
1,778
1,099
281
398
1,778 1,099 281 398
259
(000 tonnes)
June 2018
1,732
1,020
305
407
1,732 1,020 305 407
393
Yield
June 2019
3.3
2.3
5.8
4.8
3.3 2.3 5.8 4.8
6.3
(grams per tonne)
March 2019
4.0
2.9
6.3
5.4
4.0 2.9 6.3 5.4
4.1
June 2018
3.9
2.9
5.8
5.2
3.9 2.9 5.8 5.2
3.9
Gold produced
June 2019
205.6
84.6
56.4
64.7
205.6 84.6 56.4 64.7
1,782
(000 managed equivalent ounces)
March 2019
229.2
103.0
56.9
69.3
229.2 103.0 56.9 69.3
1,069
2June 018
218.8
94.6
56.8
67.4
218.8 94.6 56.8 67.4
1,518
Gold sold
June 2019
211.5
90.2
56.5
64.8
211.5 90.2 56.5 64.8
1,822
(000 managed equivalent ounces)
March 2019
221.0
92.9
59.0
69.1
221.0 92.9 59.0 69.1
982
June 2018
219.4
95.1
56.9
67.4
219.4 95.1 56.9 67.4
1,565
Cost of sales before amortisation
June 2019
(137.5)
(60.7)
(39.3)
(37.5)
(196.2) (86.7) (56.1) (53.4)
(934.7)
and depreciation
March 2019
(142.9)
(61.7)
(42.3)
(38.9)
(200.7) (86.7) (59.4) (54.6)
(734.1)
(million)
June 2018
(126.2)
(48.0)
(37.4)
(40.8)
(166.3) (62.9) (49.6) (53.8)
(930.6)
Cost of sales before gold inventory
June 2019
70 49
135 90
99 69 192 129
3,189
change and amortisation and
March 2019
73 47
137 98
103 67 193 138
3,044
depreciation (dollar per tonne)
June 2018
77 53
127 99
101 70 168 130
2,336
Sustaining capital
June 2019
(69.4) (25.9) (26.2) (17.3)
(99.0) (36.9) (37.4) (24.7)
(119.2)
(million)
March 2019
(68.5) (24.9) (28.5) (15.1)
(96.3) (34.9) (40.1) (21.3)
(130.8)
(original interpretation)
June 2018
(68.7) (26.9) (19.1) (22.8)
(90.8) (35.5) (25.2) (30.0)
(131.8)
Non-sustaining capital
June 2019
(41.5)^
– – –
– – –
– – –
–
–
(59.0)^
(million)
March 2019
(23.5)^
– – –
(33.0)^
(original interpretation)
June 2018
– – – –
– – – –
(91.4)
Total capital expenditure
June 2019
(110.9) ^ (25.9) (26.2) (17.4)
(158.0) ^ (36.9) (37.4) (24.7)
(119.2)
(million)
March 2019
(92.0) ^ (24.9) (28.5) (15.1)
(129.3) ^ (34.9) (40.1) (21.3)
(130.8)
June 2018
(68.7) (26.9) (19.1) (22.8)
(90.8) (35.5) (25.2) (30.0)
(223.2)
All-in-sustaining costs
June 2019
1,052
1,029
1,224
936
1,502 1,468 1,747 1,335
590,492
(dollar per ounce) original
March 2019
1,031
988
1,253
857
1,449 1,387 1,760 1,204
900,408
Interpretation
June 2018
940
839
1,044
995
1,240 1,103 1,383 1,311
697,450
All-in-sustaining costs
June 2019
868
873
983
760
1,238 1,245 1,402 1,085
590,492
(dollar per ounce) revised
March 2019
815
846
907
695
1,145 1,189 1,275 977
900,408
interpretation
Total all-in-cost
June 2019
1,249
1,029
1,224
936
1,781 1,468 1,747 1,335
590,492
(dollar per ounce)
March 2019
1,138
988
1,253
857
1,598 1,387 1,760 1,204
900,408
June 2018
940
839
1,044
995
1,240 1,103 1,383 1,311
755,930
Average exchange rates were US$1 = R14.40, US$1 = R14.04 and US$1 = R12.49 for the June 2019, March 2019 and June 2018 quarters, respectively.
The Australian/US dollar exchange rates were A$1 = US$0.70, A$1 = US$0.71 and A$1 = US$0.76 for the June 2019, March 2019 and June 2018 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.
&
Includes Gold Fields 45 per cent share of deferred stripping of US$20.5 million and US$2.9 million for the June 2019 and March 2019 quarters, respectively.
^ Includes non-sustaining capital expenditure for Gruyere Gold mine project of US$23.5 million (A$33.0 million) for March 2019 and US$41.5 million (A$59.0 million) for June 2019
° Excludes Gruyere physicals.
43
Gold Fields 2019 H1 RESULTS
UNDERGROUND AND SURFACE
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
Australia
South
Deep
Total Tarkwa Damang
Asanko
45%
Cerro
Corona
Total St Ives Agnew
Granny
Smith
Gruyere
50%
Tonnes mined
June 2019
1,290
254
–
–
–
–
–
1,036 311 299 426
–
(000 tonnes)* March
2019
1,201
176
– – – –
–
1,025 335 292 398
–
– underground ore
June 2018
1,171
242
–
–
–
–
–
929 182 324 424
–
June 2019
623
16
–
–
–
–
–
607 217 214 175
–
– underground waste
March 2019
589
36
–
–
–
–
–
553 246 184 122
–
June
2018
600
84
– – – –
–
516 141 216 159
–
June 2019
9,341
–
5,766 3,951 1,340 475
1,760
1,815 966
–
– 849
– surface ore
March 2019
9,151
–
6,097 4,062 1,358 677
1,921
1,133 752
– – 381
June 2018
6,722
–
4,183 3,139 1,044
–
1,619
920 920
– –
–
June 2019
11,254
270
5,766 3,951 1,340 475
1,760
3,458 1,494 513 601 849
– total
March 2019
10,941
212
6,097 4,062 1,358 677
1,921
2,711 1,333 476 520 381
June 2018
8,493
326
4,183 3,139 1,044
–
1,619
2,365 1,243 540 583
–
Grade mined
June 2019
5.3
6.3
–
–
–
–
–
5.1 3.6 6.4 5.2 –
(grams per tonne)
March 2019
5.5
6.2
–
–
–
–
–
5.4 4.4 6.0 5.8 –
– underground ore
June 2018
5.8
6.5
– – – –
–
5.4 4.7 6.0 5.2 –
June 2019
–
–
–
–
–
–
–
–
–
–
–
–
– underground waste
March 2019
–
–
– – – –
–
– – – – –
June
2018
–
–
– – – –
–
– – – – –
June 2019
1.3
–
1.3 1.3 1.6 1.6
1.2
1.3 1.7 –
– 0.8
– surface ore
March 2019
1.3
–
1.3 1.2 1.6 1.4
1.0
1.4 1.7 – – 0.8
June 2018
1.9
–
1.5 1.3 2.0 –
0.9
5.1 5.1 –
–
–
June 2019
1.8
5.9
1.3 1.3 1.6 1.6
1.2
2.7 2.2 6.4 5.2 0.8
– total
March 2019
1.8
5.2
1.3 1.2 1.6 1.4
1.0
3.3 2.6 6.0 5.8 0.8
June 2018
2.5
4.8
1.5 1.3 2.0 –
0.9
5.3 5.1 6.0 5.2 –
Gold mined
June 2019
219.8
51.3
–
–
–
–
–
168.5 36.5 61.3 70.7
–
(000 ounces)*
March 2019
213.2
35.3
– – – –
–
177.9 47.5 56.6 73.8
–
– underground ore
June 2018
211.7
50.4
– – – –
–
161.3 27.3 62.6 71.3
–
June 2019
–
–
–
–
–
–
–
–
–
–
–
–
– underground waste
March 2019
–
–
– – – –
–
– – – – –
June
2018
–
–
–
–
–
–
–
–
–
–
–
–
June 2019
391.5
–
250.2 159.0 67.5 23.7
66.4
74.9 51.9
–
– 23.0
– surface ore
March 2019
377.7
–
262.4 161.9 69.4 31.1
64.2
51.1 41.8
–
– S9.3
June 2018
396.6
0.3
198.5 132.5 66.1
–
46.2
151.5 151.5
–
–
–
June 2019
611.2
51.3
250.2 159.0 67.5 23.7
66.4
243.3 88.3 61.3 70.7 23.0
– total
March 2019
590.9
35.3
262.4 161.9 69.4 31.1
64.2
229.0 89.3 56.6 73.8 9.3
June 2018
608.2
50.7
198.5 132.5 66.1
–
46.2
312.8 178.9 62.6 71.3
–
Ore milled/treated
June 2019
1,331
269
–
–
–
–
–
1,062 338 305 420
–
(000 tonnes)
March 2019
1,214
166
– – – –
–
1,048 369 281 398
–
– underground ore
June 2018
1,170
258
–
–
–
–
–
912 201 305 406
–
June 2019
11
11
–
–
–
–
–
–
–
–
–
–
– underground waste
March 2019
33
33
–
–
–
–
–
–
–
–
–
–
June
2018
60
60
– – – –
–
– – – – –
June 2019
7,753
1
5,227 3,441 1,167 619
1,652
873 815
–
– 58
– surface ore
March 2019
7,632
60
5,146 3,445 1,150 551
1,696
730 730
– –
–
June 2018
7,083
75
4,524 3,473 1,051
–
1,665
819 819
– –
–
June 2019
9,095
282
5,227 3,441 1,167 619
1,652
1,935 1,152 305 420
58
– total
March 2019
8,878
259
5,146 3,445 1,150 551
1,696
1,778 1,099 281 398
–
June 2018
8,314
393
4,524 3,473 1,051
–
1,665
1,731 1,020 305 407
–
Yield
June 2019
5.0
6.6
–
–
–
–
–
4.6 3.4 5.8 4.8 –
(Grams per tonne)
March 2019
5.4
6.3
–
–
–
–
–
5.3 4.3 6.3 5.4 –
– underground ore
June 2018
5.1
5.8
– – – –
–
5.2 4.6 5.8 5.2 –
June 2019
–
–
–
–
–
–
–
–
–
–
–
–
– underground waste
March 2019
–
–
– – – –
–
– – – – –
June
2018
–
–
–
–
–
–
–
–
–
–
–
–
June 2019
1.4
4.0
1.3 1.2 1.5 1.4
1.5
1.7 1.8 –
–
–
– surface ore
March 2019
1.4
0.2
1.3 1.2 1.5 1.5
1.4
2.2 2.2 –
–
–
June 2018
1.4
0.1
1.3 1.2 1.6 –
1.3
3.9 2.5 –
–
–
June 2019
1.9
6.3
1.3 1.2 1.5 1.4
1.5
3.3 2.3 5.8 4.8 –
– combined
March 2019
2.0
4.1
1.3 1.2 1.5 1.5
1.4
4.0 2.9 6.3 5.4 –
June 2018
2.0
3.9
1.3 1.2 1.6 –
1.3
3.9 2.9 5.8 5.2 –
Gold produced
June 2019
215.5
57.1
–
–
–
–
–
158.4 37.3 56.4 64.7
–
(000 ounces)
March 2019
211.7
33.9
– – – –
–
177.8 51.6 56.9 69.3
–
– underground ore
June 2018
202.4
48.5
–
–
–
–
–
153.9 29.7 56.8 67.4
–
June 2019
–
–
–
–
–
–
–
–
–
–
–
–
– underground waste
March 2019
–
–
–
–
–
–
–
–
–
–
–
–
June
2018
–
–
–
–
–
–
–
–
–
–
–
–
June 2019
344.4
0.2
216.7 134.2 54.6 27.9
80.3
47.2 47.2
–
–
–
– surface ore
March 2019
349.7
0.4
221.1 136.7 57.2 27.2
76.8
51.4 51.4
–
–
–
June 2018
320.8
0.3
186.7 133.1 53.5
–
69.0
64.9 64.9
–
–
–
June 2019
559.9
57.3
216.7 134.2 54.6 27.9
80.3
205.6 84.6 56.4 64.7
–
– total
March 2019
561.5
34.3
221.1 136.7 57.2 27.2
76.8
229.2 103.0 56.9 69.3
–
June 2018
523.2
48.8
186.7 133.1 53.5
–
69.0
218.8 94.6 56.8 67.4
–
Cost of sales before gold
inventory change and
amortisation and
depreciation
June 2019
130
222
–
–
–
–
–
106 98 135 90 –
(dollar per tonne)
March 2019
131
281
– – – –
–
102 78 137 98 –
– underground
June 2018
146
231
– – – –
–
105 85 127 99 –
June 2019
26
71
27 26 28 32
24
26 28 – – –
– surface
March 2019
27
3
27 23 29 42
25
32 32 – – –
June 2018
25
1
23 19 37 –
23
45 45 – – –
June 2019
42
222
27 26 28 32
24
70 49 135 90 –
– total
March 2019
41
217
27 23 29 42
25
73 47 137 98 –
June 2018
42
187
23 19 37 –
23
77 53 127 99 –
* Excludes surface material at South Deep.
Gold Fields 2019 H1 RESULTS
44
ADMINISTRATION AND CORPORATE INFORMATION
Corporate Secretary
Taryn Harmse
Tel: +27 11 562 9719
Fax: +27 11 562 9829
e-mail: taryn.harmse@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
45
Gold Fields 2019 H1 RESULTS
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 its behalf by the undersigned, thereunto duly authorised.
GOLD FIELDS LIMITED
Dated: 15 August 2019
By:
/s/ Nicholas J. Holland
Name:
Nicholas J. Holland
Title:
Chief Executive Officer