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Gold Fields profit falls on lower South Africa output - Reuters Africa

Wednesday, 14 February 2018

JOHANNESBURG (Reuters) - Gold Fields Ltd said on Wednesday its full-year profit fell 4 percent, with production from its last South African asset South Deep falling below guidance.

Diluted headline earnings per share (HEPS) from continuing operations fell to $0.24 for 2017 from $0.25 in the previous year, but in line with what was flagged to the market.

HEPS is the main profit measure used in South Africa that strips out certain one-off items.

Gold Fields unveiled a new plan last year to make its mechanized South Deep mine, which has presented operational challenges in an unforgiving geology 3 kms (2 miles) beneath the surface, profitable with a production target of 500,000 ounces in 2022.

The company said it had incurred a 3.5 billion rand ($293.5 million) goodwill impairment due to the slow start of the rebase plan over the year at South Deep and a reduction in the gold price and resource price assumptions used in the life of mine model.

Production at Gold Fields’s South Deep mine for the year was 11 percent below original guidance at 281,000 ounces, compared with 290,000 ounces in the previous year.

“South Deep was unable to recover from the tough Q1 2017 which was impacted by two fatalities and three falls of ground in the high grade corridors,” the company said.

Gold Fields, which also operates in Ghana and Peru, declared a final dividend of 0.50 rand ($0.04) per share, taking the total dividend for the year to 0.90 rand ($0.08) per share compared with 1.10 rand per share($0.09)in the previous period.


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