| Thu 4 Nov 2010, 8:00 | | GFI - Gold Fields Limited - Preliminary results for quarter ended |
|
GFI
GOGOF
GFI - Gold Fields Limited - Preliminary results for quarter ended
30 September 2010
Gold Fields Limited
Incorporated in the Republic of South Africa
Registration number 1968/004880/06
Share code: GFI
Issuer code: GOGOF
ISIN - ZAE 000018123
PRELIMINARY RESULTS FOR QUARTER ENDED 30 SEPTEMBER 2010
Operations tracking guidance
JOHANNESBURG. 4 November 2010, Gold Fields Limited (NYSE & JSE: GFI) today
announced net earnings excluding gains and losses on foreign exchange,
exceptional items and share of gain or loss of associates after taxation for
the September 2010 quarter of R1,016 million compared with earnings of R945
million and R625 million in the June 2010 and the September 2009 quarters
respectively. In US dollar terms net earnings excluding gains and losses on
foreign exchange, exceptional items and share of gain or loss of associates
after taxation for the September 2010 quarter were US$138 million, compared
with earnings of US$125 million and US$80 million for the June 2010 and
September 2009 quarters respectively.
September 2010 quarter salient features:
- US$1 billion bond completed post quarter end;
- Group attributable gold production up to 908,000 ounces;
- Total cash cost down from R166,215 per kilogram (US$688 per ounce) to
R164,898 per kilogram (US$697 per ounce);
- NCE margin maintained at 18 per cent;
- South Deep new order mining right executed;
- Three BEE transactions approved by shareholders;
- Option agreement for 60 per cent interest in the undeveloped gold-copper
Far Southeast deposit in the Philippines signed;
- Business process re-engineering across the Group commenced.
Statement by Nick Holland, Chief Executive Officer of Gold Fields:
"Gold Fields maintained the recent improvement in its production performance
by raising attributable gold production to 908koz in the September 2010
quarter from 898koz in the June 2010 quarter. This is the highest quarterly
production since Q3 F2008. Despite seasonally higher electricity charges in
South Africa, as well as the implementation of the second year of the two
year wage agreement with trade unions in South Africa, sound cost controls
enabled us to maintain an NCE margin of 18 per cent being the margin
generated by the business after all operating costs, capital expenditure
(growth and sustaining) and brownfields exploration. Efforts will continue to
improve our NCE margin over the next 12 to 18 months, once the initial
results of our business process re-engineering across the Group are realised.
While maintaining the emphasis on safety improvements, Gold Fields remains on
track to achieve the production and cost guidance for the full year that was
provided on 6 August 2010.
We have made considerable advances in our growth strategy through the
purchase of an option on the undeveloped gold-copper Far Southeast (FSE)
deposit in the Philippines. The agreement will allow us to conduct a major
drilling programme and feasibility study on FSE over the next 18 months. If
successful the FSE acquisition will significantly advance our target of
achieving 1 million ounces for the Australasia region, either in production
or in development, by 2015. Gold Fields now has exciting growth projects in
each of the regions in which it operates. In addition to the FSE project for
the Australasia region, we have the South Deep project in South Africa, the
Yanfolila project in Mali (West Africa region) and the Chucapaca project in
Peru (South America region). We are also doing new metallurgical tests, using
a new process on the 12 million ounce APP project in Finland, and early
indications are encouraging. All of these projects are progressing rapidly
and put us on track towards achieving our target of 5 million ounces, either
in production or development, by 2015.
This growth strategy is supported by a strong balance sheet, which has been
further bolstered with the successful issue of a US$1 billion, 10-year bond
at a coupon of 4.875 per cent. The order book was more than two times
oversubscribed and the interest rate achieved was the lowest by a South
African corporate in the international US dollar bond market. The bond
significantly improves our liquidity and maturity profiles without increasing
debt levels. The funds raised will be utilised to restructure our existing
debt and we are now well placed to pursue the growth opportunities mentioned
above.
During our annual results presentation in August, I announced a comprehensive
Business Process Re-engineering (BPR) exercise at Driefontein, Kloof and
Beatrix, Tarkwa and St Ives, aimed at increasing the NCE margin at each of
these mines to at least 20 per cent. Significant progress was made during the
past quarter. As a first step, we have implemented a wide-ranging
restructuring of the South Africa region, led by the merger of the
Driefontein and Kloof operational and management structures. Details of the
restructuring are contained in this report. We have also made significant
progress at our Tarkwa mine in Ghana and St Ives in Australia.
During the June quarter Gold Fields executed the new order mining right for
South Deep and the finalisation of the terms of the three empowerment
transactions. The deals, which include an Employee Share Option plan for
10.75 per cent of GFIMSA, a broad-based transaction for 10 per cent of South
Deep and a broad-based Black Economic Empowerment (BEE) transaction for 1 per
cent of GFIMSA, excluding South Deep, will enable us to achieve our 2014
mining charter ownership target and are expected to be completed by the end
of December 2010."
Stock data
Number of shares in issue
- at end September 2010 706,236,170
- average for the quarter 706,090,891
Free Float 100 per cent
ADR Ratio 1:1
Bloomberg / Reuters GFISJ / GFLJ.J
JSE Limited - (GFI)
Range - Quarter ZAR94.90 - ZAR111.99
Average Volume - Quarter 2,350,999 shares / day
NYSE - (GFI)
Range - Quarter US$12.50 - US$15.34
Average Volume - Quarter 4,020,429 shares / day
SOUTH AFRICAN RAND
Quarter
Key statistics
September June September
2009 2010 2010
Gold produced* 28,165 27,929 28,232
kg
Total cash cost 147,343 166,215 164,898 R/kg
Notional cash expenditure 207,754 235,223 238,348 R/kg
Tonnes milled/treated 13,559 14,863 14,510 000
Revenue 241,164 287,454 289,329 R/kg
Operating costs 343 343 357 R/tonne
Operating profit 2,787 3,738 3,921 Rm
Operating margin 38 42 43 per cent
NCE margin 14 18 18 per cent
1,007 900 701 Rm
Net earnings
143 128 99 SA c.p.s.
452 1,039 699 Rm
Headline earnings
64 147 99 SA c.p.s.
Net earnings excluding gains
and losses
625 945 1,016 Rm
on foreign exchange, financial
instruments, exceptional items and
89 134 144 SA c.p.s.
share of gain/(loss) of associates
after taxation
UNITED STATES DOLLARS
Quarter
Key statistics
September June September
2010 2010 2009
Gold produced* oz (000) 908 898 906
Total cash cost $/oz 697 688 586
Notional cash expenditure $/oz 1,007 974 826
Tonnes milled/treated 000 14,510 14,863 13,559
Revenue $/oz 1,223 1,191 959
Operating costs $/tonne 48 46 44
Operating profit $m 533 496 356
Operating margin per cent 43 42 38
NCE margin per cent 18 18 14
$m 95 120 129
Net earnings
US c.p.s. 13 17 18
$m 95 138 58
Headline earnings
US c.p.s. 13 20 8
Net earnings excluding gains
and losses
$m 138 125 80
on foreign exchange, financial
instruments, exceptional
items and US c.p.s. 20 18 11
share of gain/(loss) of
associates after taxation
* All of the key statistics given above are managed figures, except for gold
produced which is attributable equivalent production.
All operations are wholly owned except for Tarkwa and Damang in Ghana (71.1
per cent) and Cerro Corona in Peru (80.7 per cent).
Gold produced (and sales) throughout this report includes copper gold
equivalents of approximately 6 per cent.
Certain forward looking statements
Certain statements in this document constitute "forward looking statements"
within the meaning of Section 27A of the US Securities Act of 1933 and
Section 21E of the US Securities Exchange Act of 1934.
Such forward looking statements involve known and unknown risks,
uncertainties and other important factors that could cause the actual
results, performance or achievements of the company to be materially
different from the future results, performance or achievements expressed or
implied by such forward looking statements. Such risks, uncertainties and
other important factors include among others: economic, business and
political conditions in South Africa, Ghana, Australia, Peru and elsewhere;
the ability to achieve anticipated efficiencies and other cost savings in
connection with past and future acquisitions, exploration and development
activities; decreases in the market price of gold and/or copper; hazards
associated with underground and surface gold mining; labour disruptions;
availability terms and deployment of capital or credit; changes in government
regulations, particularly environmental regulations; and new legislation
affecting mining and mineral rights; changes in exchange rates; currency
devaluations; inflation and other macro-economic factors, industrial action,
temporary stoppages of mines for safety and unplanned maintenance reasons;
and the impact of the AIDS crisis in South Africa. These forward looking
statements speak only as of the date of this document.
The company 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 document or to reflect the occurrence of
unanticipated events.
Health and safety
We regret to report that six fatalities occurred at the South Africa region
during the quarter and one fatality at the West Africa region.
In comparison with the previous quarter, the Group`s fatal injury frequency
rate regressed from 0.07 to 0.18. The lost time injury frequency rate
improved by 6 per cent from 4.62 to 4.33 and the serious injury frequency
rate regressed by 10 per cent from 2.30 to 2.54. The days lost injury
frequency rate improved by 4 per cent from 206 to 197.
Extensive management audits have been conducted in order to determine areas
for improvement in our current working practices. In addition the Safety
department has been reorganised to (i) strengthen the focus on facilitating
audits to test for compliance with procedures and (ii) build competencies
among supervisors and crews. Lastly, a mobilisation and engagement programme
is being piloted at Kloof 4 shaft to assist supervisors to become more
effective in aligning teams to deliver a safe quality daily blast.
Financial review
Quarter ended 30 September 2010 compared with quarter
ended 30 June 2010
Revenue
Attributable gold production increased by 1 per cent from 898,000 ounces in
the June quarter to 908,000 ounces in the September quarter. At the South
African operations, production increased from 488,000 ounces to 497,000
ounces. Attributable gold production at the West African operations decreased
by 6 per cent from 183,000 ounces to 172,000 ounces. Attributable equivalent
gold production at the South American operation increased by 10 per cent from
78,000 ounces to 86,000 ounces. At the Australian operations, gold production
increased by 3 per cent from 149,000 ounces to 153,000 ounces.
At the South African operations, gold production in the September quarter at
Driefontein, Beatrix and South Deep was 4 per cent, 12 per cent and 1 per
cent higher than the June quarter at 6,017 kilograms, 3,202 kilograms and
2,198 kilograms. This was mainly due to increased underground volumes at
Beatrix and South Deep and higher grades at Driefontein and Beatrix. At
Kloof, production decreased by 8 per cent from 4,369 kilograms to 4,041
kilograms due to lower volumes from underground following two fatal accidents
at 4 shaft.
At the West African operations, managed gold production at Tarkwa decreased
by 7 per cent to 185,500 ounces for the quarter mainly due to decreased heap
leach throughput and a slightly lower head grade. At Damang, gold production
was similar at 56,500 ounces.
In South America, production at Cerro Corona increased by 10 per cent from
96,500 equivalent ounces in the June quarter to 105,800 equivalent ounces in
the September quarter. This increase was due to an increase in ore processed
and higher metal recoveries.
At the Australian operations, Agnew`s gold production increased by 11 per
cent to 35,300 ounces due to increased stope availability and an increase in
grade from the high grade Kim south ore body following rehabilitation work in
the previous quarter. At St Ives, gold production was similar at 117,900
ounces.
The average quarterly US dollar gold price achieved increased from US$1,191
per ounce in the June quarter to US$1,223 per ounce in the September quarter.
The average rand/US dollar exchange rate at R7.36 was 2 per cent stronger
than the June quarter, while the rand/Australian dollar at R6.59 was
marginally stronger than the R6.66 recorded in the June quarter. The rand
gold price increased from R287,454 per kilogram to R289,329 per kilogram. The
Australian dollar gold price was unchanged at A$1,359 per ounce.
Revenue increased from R8,803 million (US$1,169 million) in the June quarter
to R9,053 million (US$1,230 million) in the September quarter due to the
increased production and the higher gold price received.
Operating costs
Net operating costs increased from R5,065 million (US$673 million) in the
June quarter to R5,132 million (US$697 million) in the September quarter.
Total cash cost decreased from R166,215 per kilogram (US$688 per ounce) to
R164,898 per kilogram (US$697 per ounce). This decrease was due to higher
production.
At the South African operations, operating costs increased by 6 per cent from
R2,905 million (US$386 million) to R3,075 million (US$418 million) mainly due
to annual wage increases of 7.5 per cent and the increased production. Total
cash cost at the South African operations increased by 4 per cent from
R187,770 per kilogram (US$778 per ounce) to R195,627 per kilogram (US$827 per
ounce).
At the West African operations, operating costs including gold-in- process
movements, decreased by 5 per cent from US$151 million (R1,140 million) in
the June quarter to US$143 million (R1,051 million) in the September quarter.
Tarkwa and Damang`s costs decreased by US$6 million and US$3 million
respectively due to lower tonnes mined and processed, partly offset by
increased power costs. Total cash cost at the West African operations
decreased from US$623 per ounce in the June quarter to US$616 per ounce in
the September quarter due to the lower operating costs.
At Cerro Corona in South America, operating costs including gold- in-process
movements amounted to US$39 million (R290 million), which was US$7 million
more than the June quarter mainly due to increased accrual for statutory
workers participation and increased freight costs. Total cash cost at Cerro
Corona decreased from US$369 per ounce in the June quarter to US$354 per
ounce in the September quarter due to higher production.
At the Australian operations, operating costs including gold-in- process
movements decreased from A$117 million (R779 million) to A$109 million (R716
million). At St Ives, net operating costs decreased by A$5 million to A$84
million (R552 million) mainly due to lower maintenance costs and lower
volumes. At Agnew, operating costs were A$3 million lower than the previous
quarter at A$25 million (R164 million) due to the build-up of gold-in-
process. Total cash cost for the region decreased by 6 per cent from US$703
per ounce (A$792 per ounce) to US$658 per ounce (A$735 per ounce).
Operating margin
The net effect of the changes in revenue and costs, after taking into account
gold-in-process movements, was a 5 per cent increase in operating profit from
R3,738 million (US$496 million) in the June quarter to R3,921 million (US$533
million) in the September quarter in line with the higher production and the
higher gold prices achieved. The Group operating margin was 43 per cent
compared with 42 per cent in the June quarter. The margin at the South
African operations decreased from 34 per cent to 31 per cent. At the West
African operations the margin increased from 51 per cent to 52 per cent. At
Cerro Corona in South America the margin increased from 68 per cent to 72 per
cent, while at the Australian operations the margin increased from 42 per
cent to 48 per cent.
Amortisation
Amortisation increased from R1,368 million (US$182 million) in the June
quarter to R1,443 million (US$196 million) in the September quarter in line
with the higher production. At the South African operations amortisation
increased from R661 million (US$88 million) to R716 million (US$97 million).
This was mainly due to the increase in production at all the operations,
except Kloof.
At the West African operations, amortisation decreased from US$39 million
(R293 million) to US$35 million (R254 million). This decrease was mainly at
Tarkwa in line with the lower production. At the South America operation,
amortisation was similar at US$15 million (R110 million). At the Australian
operations amortisation increased from A$40 million (R266 million) to AS$50
million (R327 million) mainly due to changes in the production mix combined
with a small increase in production for the region.
Other
Net interest paid of R70 million (US$10 million) in the September quarter
compares with net interest paid of R33 million (US$4 million) in the June
quarter. In the September quarter interest paid of R120 million (US$16
million) was partly offset by interest received of R35 million (US$4 million)
and interest capitalised of R15 million (US$2 million). This compares with
interest paid of R146 million (US$19 million), partly offset by interest
received of R90 million (US$12 million) and interest capitalised of R23
million (US$3 million) in the June quarter. The lower interest received in
the September quarter was due to a change in the mix between onshore and
offshore cash balances.
The share of loss of associates after taxation of R218 million (US$30
million) in the September quarter compares with a gain of R86 million (US$11
million) in the June quarter. The September quarter includes R236 million
(US$32 million) relating to a translation loss as a result of Rusoro applying
hyper inflationary accounting to its investments in Venezuela partly offset
by R18 million (US$2 million) gains from the Group`s 35 per cent interest in
Rand Refinery. As a result of the loss above, the investment in Rusoro has
been written down to nil. In the June quarter R68 million (US$9 million)
related to a translation gain as a result of Rusoro applying hyper
inflationary accounting to its investments in Venezuela, and R18 million
(US$2 million) related to gains from Rand Refinery.
The loss on foreign exchange of R11 million (US$2 million) in the September
quarter compares with a gain of R6 million (US$1 million) in the June
quarter. These exchange differences relate to the conversion of offshore cash
holdings into their functional currencies.
The loss on financial instruments of R3 million (US$1 million) in the
September quarter, compares with a gain of R19 million (US$2 million) in the
June quarter. The September quarter includes losses on outstanding US$/ZAR
and A$/ZAR forward cover contracts. The gain in the June quarter included
realised gains of R13 million (US$2 million) on the Cerro Corona copper
financial instruments and a R6 million (US$1 million) gain on US$/ZAR forward
cover contracts taken out. Refer to page 15 of this report for more detail.
Share based payments of R119 million (US$16 million) was R73 million (US$10
million) higher than the June quarter`s R46 million (US$6 million) due to
year-end forfeitures in the June quarter.
Other costs decreased from R120 million (US$16 million) in the June quarter
to R24 million (US$3 million) in the September quarter. This decrease was
mainly due to lower bank facility fees at the South African operations and a
decrease in research and development expenditure. The September quarter
included sponsorships to the University of Johannesburg, while the June
quarter included sponsorships to the University of the Witwatersrand.
Exploration
Exploration expenditure decreased from R186 million (US$25 million) in the
June quarter to R124 million (US$17 million) in the September quarter due to
a decrease in activity during the rainy season and timing of expenditure.
Refer to the Exploration and Corporate Development section of this report for
more detail of exploration activities.
Exceptional items
The exceptional loss in the September quarter of R138 million (US$19 million)
was as a result of voluntary separation packages of R118 million (US$16
million) and costs incurred of R24 million (US$3 million) on business process
re-engineering at the South African, Ghanaian and Australian operations
partly offset by profit on the sale of assets and investments of R4 million
(US$0.5 million). The exceptional loss in the June quarter of R144 million
(US$19 million) was mainly as a result of an impairment on our investment in
Rusoro of R197 million (US$26 million), partly offset by a profit on the
disposal of the remaining Eldorado shares of R49 million (US$6 million).
Taxation
Taxation for the quarter amounted to R849 million (US$115 million) compared
with R865 million (US$115 million) in the June quarter.The tax expense
includes normal and deferred taxation at all operations,together with
government royalties.
Earnings
Net profit attributable to ordinary shareholders amounted to R701 million
(US$95 million) or 99 SA cents per share (US$0.13 per share), compared with
R900 million (US$120 million) or 128 SA cents per share (US$0.17 per share)
in the June quarter.
Headline earnings i.e. earnings less the after tax effect of asset sales,
impairments and the sale of investments, amounted to R699 million (US$95
million) or 99 SA cents per share (US$0.13 per share), compared with earnings
of R1,039 million (US$138 million) or 147 SA cents per share (US$0.20 per
share) in the June quarter.
Earnings excluding exceptional items as well as gains and losses on foreign
exchange, financial instruments and gains or losses of associates after
taxation amounted to R1,016 million (US$138 million) or 144 SA cents per
share (US$0.20 per share), compared with earnings of R945 million (US$125
million) or 134 SA cents per share (US$0.18 per share) reported in the June
quarter.
Cash flow
Cash inflow from operating activities for the quarter amounted to R2,251
million (US$308 million), compared with R3,650 million (US$482 million) in
the June quarter. This quarter on quarter decrease of R1.4 billion (US$174
million) was mainly due to movements in working capital. The investment into
working capital of R753 million (US$102 million) in the September quarter is
expected to be significantly less in the December quarter.
In the September quarter dividends paid to ordinary shareholders amounted to
R494 million (US$67 million). No dividends were paid to ordinary shareholders
in the June quarter. In the June quarter R175 million (US$23 million) was
paid to non controlling interest holders at Tarkwa and Damang.
Capital expenditure increased from R2,157 million (US$287 million) in the
June quarter to R2,225 million (US$302 million) in the September quarter.
At the South African operations, capital expenditure increased from R1,236
million (US$164 million) in the June quarter to R1,317 million (US$179
million) in the September quarter mainly due to increased capital expenditure
at South Deep. Capital expenditure at South Deep amounted to R492 million
(US$ 67 million) in the September quarter compared with R399 million (US$53
milion) in the June quarter, with the majority of the expenditure on
development and the ventilation shaft deepening and
infrastructure.Expenditure on ore reserve development (ORD) was similar at
R493 million (US$66 million). Driefontein`s ORD increased from R184 million
to R215 million, Kloof`s ORD decreased from R198 million to R180 million and
Beatrix`s ORD decreased from R113 million to R98 million quarter on quarter.
At the West African operations, capital expenditure increased from US$53
million to US$74 million due to increased expenditure on capital waste
removal at Teberebie and Pepe, new mining equipment and expenditure on mining
fleet at Damang as a consequence of the impending change from contract to
owner mining. In South America, at Cerro Corona, capital expenditure
decreased from US$14 million to US$11 million due to timing of work.
At the Australian operations, capital expenditure decreased from A$61 million
to A$42 million for the quarter. At Agnew, capital expenditure decreased from
A$26 million to A$11 million due to the acquisition of fleet in the June
quarter due to the conversion from contract mining to owner mining. St Ives
decreased from A$35 million to A$31 million due to less development
expenditure required this quarter on the Athena project.
Purchase of investments of R23 million (US$3 million) mainly relates to a
secured equipment loan made to one of our mining contractors at St Ives.
Net cash inflow from financing activities in the September quarter amounted
to R1,189 million (US$169 million). Loans received in the September quarter
amounted to R4.0 billion (US$557 million). This relates to the issue of
commercial paper of R1.8 billion (US$248 million), Cerro Corona non-recourse
term loan of R1.4 billion (US$200 million), an additional R492 million (US$70
million) draw down on an offshore facility and R290 million (US$39 million)
working capital loans. Loans repaid amounted to R2.8 billion (US$390
million), consisting primarily of R2.1 billion (US$290 million) refinancing
of the South African commercial paper programme and final repayment of the
project finance facility at Cerro Corona of R705 million (US$100 million).
Net cash inflow for the September quarter at R717 million (US$107 million)
compared with R918 million (US$131 million) in the June quarter. After
accounting for a negative translation adjustment of R194 million (positive
US$6 million) on offshore cash balances, the net cash inflow for the
September quarter was R523 million (US$113 million). The cash balance at the
end of September was R4,313 million (US$614 million) compared with R3,791
million (US$501 million) at the end of June.
Notional cash expenditure (NCE)
Notional cash expenditure is defined as operating costs (including general
and administration) plus capital expenditure, which includes brownfields
exploration, and is reported on a per kilogram and per ounce basis - refer to
the detailed table on page 24 of this report.
NCE per ounce determines how much free cash flow is generated in order to pay
taxation, interest, greenfields exploration and dividends.
The NCE for the Group for the September quarter amounted to R238,348 per
kilogram (US$1,007 per ounce) compared with R235,223 per kilogram (US$974 per
ounce) in the June quarter. The NCE margin for the Group of 18 per cent was
similar to the June quarter.
At the South African operations, NCE increased from R272,669 per kilogram
(US$1,129 per ounce) to R284,118 per kilogram (US$1,201 per ounce). The NCE
margin of 1 per cent in the September quarter compares with 6 per cent in the
June quarter. This decrease was due to the increase in operating cost and
capital expenditure, partially offset by the increase in production. The
overall NCE margin is impacted by the ongoing funding of the South Deep
growth project by the balance of the operations in the South Africa region.
At the West African operations, NCE increased from US$795 per ounce to US$883
per ounce and the NCE margin decreased from 34 per cent to 28 per cent due to
the lower production and increased capital expenditure.
At the South American operation, NCE improved by 9 per cent from US$502 per
ounce in the June quarter to US$456 per ounce in the September quarter due to
the increased production together with a reduction in capital expenditure.
The NCE margin improved from 54 per cent to 64 per cent. At the Australian
operations NCE improved from US$1,080 per ounce (A$1,217 per ounce) in the
June quarter to US$951 per ounce (A$1,062 per ounce) in the September quarter
resulting in an increase in NCE margin from 10 per cent to 22 per cent due to
increased production and lower capital expenditure.
Balance sheet (Investments and net debt)
Investments decreased from R1,036 million (US$137 million) at 30 June 2010 to
R885 million (US$126 million) at 30 September 2010 mainly due to the write-
down of Rusoro.
Net debt (long-term loans plus current portion of long-term loans less cash
and deposits) increased marginally from R4,697 million (US$620 million) in
the June quarter to R5,076 million (US$722 million) in the September quarter.
Detailed and operational review
South Africa region
Cost and revenue optimisation initiatives
During financial 2008, the South Africa region reviewed the suite of projects
under Project 500 and identified the following for implementation over two to
three years. Progress on these projects is set out below.
Project 1M
Project 1M is a productivity initiative that aims to improve quality mining
volumes by increasing the face advance by between 5 and 10 per cent per annum
based on financial year 2009 actuals.
This should be achieved through the following key improvement initiatives:
- drilling and blasting practices to improve advance per blast;
- support, cleaning and sweeping practices to improve blasting frequency;
- mining cycle, labour availability and training; and
- improved pay face availability.
Average face advance improved marginally from 6.7 metres to 6.8 metres in the
September quarter. Safety related production interruptions, extraction rate
limits required for management of seismic risk, limitations on the face time
available and unplanned crew moves, which are mainly necessitated by seismic
damage or loss of grade, continue to remain the major factors that inhibit
improvements in face advance. Project 1M remains focused on identifying and
addressing the key constraints that affect stope team productivity on a shaft
by shaft basis and improving flexibility to counter some of these issues.
Project 2M
Project 2M is a technology initiative aimed at mechanising all flat- end
development (i.e. development on the horizontal plane) at the long-life
shafts of Driefontein, Kloof and Beatrix. South Deep is excluded as it is
already a fully mechanised mine. The aim of the project is to improve safety
and productivity, reduce development costs and increase ore reserve
flexibility through higher monthly advance rates.
For the September quarter, 67.1 per cent of flat-end metres were advanced by
mechanised means at the long life shafts at Driefontein, Kloof and Beatrix
compared with 66.8 per cent in the June quarter.
Three additional rigs are being put into service during the December quarter
to mechanise ends that are currently being mined conventionally. Constraints
that are inhibiting the rigs from achieving their potential advance rates are
being addressed by optimising maintenance arrangements, implementing electro-
hydraulic loaders, re-training drill rig operators and reviewing operating
practices and logistics especially on the cleaning cycle.
Project 3M (Business process re-engineering)
Refer to page 10 of this report for the background to this initiative and an
overview of post quarter-end developments.
Project 4M
Project 4M focuses on the Mine Health and Safety Council (MHSC) milestones
agreed to on 15 June 2003 at a tripartite health and safety summit,
comprising representatives from Government, organised labour and mining
companies. The focus is on achieving occupational health and safety targets
and milestones over a 10- year period. The commitment was driven by the need
to achieve greater improvements in occupational health and safety in the
mining industry.
One of the milestone targets is that no machine or piece of equipment may
generate a sound pressure level in excess of 110 dB (A) after December 2013.
In order to achieve this target the company is focusing on reducing the noise
at source. Good progress has been made and by the end of the quarter 97 per
cent of equipment measured was below 110 dB (A).
Silicosis remains one of the biggest health risks associated with the gold
mining industry. In order to meet the silicosis targets the company has
several interventions in place, which include:
- the upgrading of tip filters by replacing complete unit installations or
the installation of additional first stage pre- filtration systems to
increase dust filtration efficiency and to remove larger particles of dust
before it enters the primary dust filtration unit;
- the use of foggers to trap dust particles liberated from tipping points
before dust enters the main air stream;
- footwall treatment to bind dust on the footwall and prevent it from being
liberated into the intake air ways; and
- installation of tip doors. The tip doors are installed into the tipping
points and remain closed when no tipping is taking place, thus reducing dust
from entering the intake airways. The tip doors are spring loaded hence they
are self-closing after tipping is completed.
Progress to date on the above initiatives is an implementation rate of 50 per
cent, 83 per cent, 100 per cent and 65 per cent respectively across the South
African operations. This progress should enable the Group to meet its
targets.
Of the individual gravimetric dust sample measurements taken during the June
quarter 97 per cent were below the occupational exposure limit of 0.1
milligrams per cubic metre, thus meeting the target of not less than 95 per
cent of individual samples below the occupational exposure limit of 0.1
milligrams per cubic metre.Progress against all interventions is monitored
monthly and reviewed quarterly.
South Africa region
Driefontein
September 2010 June 2010
Gold produced - kg 6,017 5,783
- 000`oz 193.5 185.9
Yield - underground - g/t 6.8 6.1
- combined - g/t 4.0 3.6
Total cash cost - R/kg 171,780 175,584
- US$/oz 726 727
Notional cash expenditure - R/kg 229,666 233,910
- US$/oz 971 969
NCE margin - % 20 19
Gold production increased from 5,783 kilograms (185,900 ounces) in the June
quarter to 6,017 kilograms (193,500 ounces) in the September quarter.
Underground tonnes milled decreased from 841,000 tonnes in the June quarter
to 793,000 tonnes in the September quarter due to a decrease in milling width
as a result of a reduction in stope width to improve mining quality.
Production throughout the quarter was also affected by a lack of flexibility
at 2 and 4 shafts, a fire at 4 shaft and the impact of safety related
stoppages particularly at 4 and 5 shafts. Underground yield increased from
6.1 grams
per tonne to 6.8 grams per tonne due to an increase in the mine call factor,
a decrease in development waste milled and a general improvement in average
mining grades at 1, 4 and 8 shafts.
Surface tonnes milled decreased from 753,000 tonnes to 728,000 tonnes and
surface yield remained at 0.9 grams per tonne.
Main development increased by 11 per cent for the quarter and on- reef
development increased by 3 per cent. The average development value increased
from 1,592 centimeter grams per tonne in the June quarter to 1,872 centimeter
grams per tonne in the September quarter, due to an improvement in the values
at 1, 4 and 5 shafts.
Operating costs increased from R1,019 million (US$135 million) to R1,038
million (US$141 million). This increase was mainly due to annual wage
increases effective from July and higher stores consumption. Cost increases
have been partially offset by a decrease in employees in service. Total cash
cost decreased from R175,584 per kilogram (US$727 per ounce) to R171,780 per
kilogram (US$726 per ounce).
Operating profit increased from R656 million (US$87 million) in the June
quarter to R696 million (US$95 million) in the September quarter mainly due
to the higher production.
Capital expenditure increased from R334 million (US$44 million) to R344
million (US$47million) in the September quarter due to increased capitalised
development and housing upgrades, partially offset by reduced spending on new
technology and technical projects.
Notional cash expenditure decreased from R233,910 per kilogram (US$969 per
ounce) to R229,666 per kilogram (US$971 per ounce) as a result of the higher
gold production.
Kloof
September 2010 June 2010
Gold produced - kg 4,041 4,369
- 000`oz 129.9 140.5
Yield - underground - g/t 6.4 6.5
- combined - g/t 3.7 3.8
Total cash cost - R/kg 219,277 196,201
- US$/oz 927 813
Notional cash expenditure - R/kg 308,488 274,319
- US$/oz 1,304 1,136
NCE margin - % (7) 5
Gold production decreased from 4,369 kilograms (140,500 ounces) in the June
quarter to 4,041 kilograms (129,900 ounces) in the September quarter.
Underground tonnes milled decreased from 599,000 tonnes to 577,000 tonnes
with a decrease in yield from 6.5 grams per tonne to 6.4 grams per tonne.
Safety stoppages following two fatalities at 4 shaft on 18 and 20 August
respectively, severely affected production. Surface tonnes milled decreased
from 558,000 tonnes to 529,000 tonnes, while the yield reduced from 0.9 grams
per tonne to 0.6 grams per tonne.
Main development decreased by 18 per cent and on-reef development decreased
by 9 per cent largely as a result of the safety stoppages. The average
development value decreased from 2,378 centimetre grams per tonne in the June
quarter to 2,288 centimetre grams per tonne in the September quarter.
Operating costs increased from R883 million (US$117 million) in the June
quarter to R911 million (US$124 million) in the September quarter. The
increase in operating costs was largely as a result of the annual wage
increase and a decrease in ore reserve development capitalised. Total cash
cost increased from R196,201 per kilogram (US$813 per ounce) to R219,277 per
kilogram (US$927 per ounce) due to higher operating cost and lower gold
production.
Operating profit decreased from R380 million (US$50 million) in the June
quarter to R252 million (US$34 million) in the September quarter.
Capital expenditure increased from R316 million (US$42 million) to R336
million (US$46 million) in the September quarter.
Notional cash expenditure increased from R274,319 per kilogram (US$1,136 per
ounce) to R308,488 per kilogram (US$1,304 per ounce) due to the lower gold
production, increased cost and increased capital expenditure.
Beatrix
September 2010 June 2010
Gold produced - kg 3,202 2,856
- 000`oz 102.9 91.8
Yield - underground - g/t 4.5 4.1
- combined - g/t 3.4 4.0
Total cash cost - R/kg 191,599 189,216
- US$/oz 810 784
Notional cash expenditure - R/kg 241,037 260,049
- US$/oz 1,019 1,077
NCE margin - % 16 10
Gold production increased from 2,856 kilograms (91,800 ounces) in the June
quarter to 3,202 kilograms (102,900 ounces) in the September quarter.
Underground tonnes milled decreased from 697,000 tonnes to 686,000 tonnes
offset by the yield which increased from 4.1 grams per tonne to 4.5 grams per
tonne. Surface gold increased from 18 kilograms to 126 kilograms as a result
of milling 251,000 tonnes of surface mineralised waste this quarter compared
with 20,000 tonnes in the June quarter. The increase in the gold price and
available milling capacity at No 2 plant warrants the processing of surface
ore of which 5.7 million tonnes of stockpiles are available at an average
grade of more than 0.4 grams per tonne and at a cost of less than R200,000
per kilogram.
Main development decreased from 7,990 metres in the June quarter to 6,486
metres in the September quarter in line with the mine plan. The on-reef
development increased from 1,537 metres to 1,850 metres and the average main
development value decreased from 997 centimetre grams per tonne in the March
quarter to 961 centimetre grams per tonne in the June quarter, mainly due to
the value variability of the zones being developed.
Operating costs increased from R555 million (US$74 million) in the June
quarter to R627 million (US$85 million) in the September quarter. This
increase was mainly due to the increased expenditure on renewals and
replacements, a decrease in ore reserve development capitalised and
additional surface ore transported from the West section to the No. 1 plant.
Total cash cost increased marginally from R189,216 per kilogram (US$784 per
ounce) in the June quarter to R191,599 per kilogram (US$810 per ounce) in the
September quarter.
Operating profit increased from R271 million (US$36 million) in the June
quarter to R294 million (US$40 million) in the September quarter due to the
increased gold production.
Capital expenditure decreased from R188 million (US$25 million) in the June
quarter to R145 million (US$20 million) in the September quarter with the
majority spent on infrastructure upgrades and ore reserve development.
Notional cash expenditure decreased from R260,049 per kilogram (US$1,077 per
ounce) in the June quarter to R241,037 per kilogram (US$1,019 per ounce) in
the September quarter due to the increased production.
South Deep project
September 2010 June 2010
Gold produced - kg 2,198 2,176
- 000`oz 70.7 70.0
Yield - underground - g/t 5.9 6.3
- combined - g/t 4.4 4.7
Total cash cost - R/kg 223,294 201,333
- US$/oz 944 834
Notional cash expenditure - R/kg 451,137 388,925
- US$/oz 1,907 1,611
NCE margin - % (57) (34)
Gold production at South Deep increased from 2,176 kilograms (70,000 ounces)
in the June quarter to 2,198 kilograms (70,700 ounces) in the September
quarter, due to improved underground mining volumes. Production for both
August and September was at record levels of 142,000 reef tonnes broken per
month with increased production from long hole stoping and benching.
Underground ore processed increased from 345,000 tonnes in the June quarter
to 370,000 tonnes in the September quarter. Total tonnes milled, which
included 20,000 tonnes of surface sources and 105,000 tonnes of off reef
development, increased by 7 per cent from 463,000 tonnes in the June quarter
to 495,000 tonnes in the September quarter. Reef yield decreased from 6.3
grams per tonne in the June quarter to 5.9 grams per tonne in the September
quarter, primarily due to lower grades in the 87 1 West and 2 West projects
and the mining mix.
Development increased by 22 per cent for the September quarter from 2,449
metres to 2,982 metres. The new mine capital development in phase 1, sub 95
level, increased by 14 per cent for the September quarter from 821 metres to
935 metres. Development in the current mine areas above 95 level increased by
30 per cent for the September quarter from 1,369 metres to 1,774 metres. The
increase in development was primarily due to an increase in drill rig
availability and utilisation, as well as improved rock handling at Twin
shaft. Raiseboring increased from 259 metres in the June quarter to 273
metres in the September quarter.
Operating costs increased from R448 million (US$60 million) in the June
quarter to R499 million (US$68 million) in the September quarter. This
increase was mainly due to the increase in underground ore production, annual
wage increases, higher electricity costs and increased expenditure as per the
planned project build-up. The total cash cost increased by 11 per cent from
R201,333 per kilogram (US$834 per ounce) in the June quarter to R223,294 per
kilogram (US$944 per ounce) in the September quarter.
Operating profit decreased from R184 million (US$24 million) in the June
quarter to R134 million (US$18 million) in the September quarter due to the
higher operating costs.
Capital expenditure increased by 23 per cent from R399 million (US$53
million) in the June quarter to R492 million (US$67 million) in the September
quarter in line with the project plan. The major capital expenditure was on
development, the ventilation shaft deepening and infrastructure, and
construction of the new tailings dam facility.
Notional cash expenditure increased by 16 per cent from R388,925 per kilogram
(US$1,611 per ounce) in the June quarter to R451,137 per kilogram (US$1,907
per ounce) in the September quarter due to higher capital expenditure and
operating costs.
South Deep will continue to focus on delivering to the planned development
metres, completing the Twin shaft infrastructure and the new tailings dam and
increasing production, as per the build-up plan.
West Africa region
Ghana
Tarkwa
September 2010 June 2010
Gold produced - 000`oz 185.5 200.2
Yield - heap leach - g/t 0.5 0.6
- CIL plant - g/t 1.5 1.5
- combined - g/t 1.0 1.0
Total cash cost - US$/oz 601 599
Notional cash expenditure - US$/oz 885 771
NCE margin - % 28 36
Gold production decreased from 200,200 ounces in the June quarter to 185,500
ounces in the September quarter. The lower production was as a result of
decreased heap leach throughput, decreased heap leach head grade and reduced
plant availability due to scheduled mill relining.
Total tonnes mined, including capital stripping, decreased from 34.9 million
tonnes in the June quarter to 34.2 million tonnes in the September quarter.
Ore mined decreased from 5.8 million tonnes to 5.2 million tonnes, largely
due to reduced feed required for the North heap leach and CIL plant as a
consequence of the harder ore restricting throughput. Mined grade of 1.23
grams per tonne in the September quarter was marginally lower than the 1.24
grams per tonne in the June quarter. The strip ratio increased from 5.03 in
the June quarter to 5.54 in the September quarter.
The total feed to the CIL plant decreased by 6 per cent from 2.97 million
tonnes in the June quarter to 2.79 million tonnes in the September quarter
mainly due to a major relining on the SAG and Ball mill. Yield from the CIL
plant was similar to the previous quarter at 1.45 grams per tonne. The CIL
plant produced 133,900 ounces in the September quarter compared with 137,500
ounces in the June quarter, a decrease of 3 per cent quarter on quarter.
Total feed to the North heap leach decreased by 12 per cent from 2.37 million
tonnes in the June quarter to 2.08 million tonnes in the September quarter.
North heap leach yield for the quarter was 0.61 grams per tonne, a decrease
of 0.05 grams per tonne against the previous quarter. The "High Pressure
Grinding Roller" (HPGR) unit at the South heap leach processed 0.88 million
tonnes, an increase of 5 per cent on the 0.84 million tonnes achieved in the
June quarter. The average yield of 0.39 grams per tonne from HPGR production
represented a decrease of 0.06 grams per tonne against the June quarter. The
heap leach section produced 51,600 ounces, 18 per cent less than the previous
quarter. The shortfall was attributable to increased ore hardness, resulting
in lower volumes of processed feed and lower recoveries. The crushing circuit
at the North heap leach is planned to be upgraded to sustain and improve the
throughput for more competent ore.
Operating costs, including gold-in-process movements, decreased from US$113
million (R854 million) in the June quarter to US$108 million (R791 million)
in the September quarter. The decrease was mainly as a result of the lower
tonnes mined and processed, partially offset by increased power costs. Total
cash cost was similar at US$601 per ounce.
Operating profit decreased from US$125 million (R945 million) in the June
quarter to US$119 million (R879 million) in the September quarter due to
lower production.
Capital expenditure increased from US$41 million (R309 million) in the June
quarter to US$61 million (R448 million) in the September quarter, with new
mining equipment, the tailings dam expansion and pre-stripping at the
Teberebie and Pepe cutbacks being the major items.
Notional cash expenditure increased from US$771 per ounce to US$885 per
ounce, reflecting the decreased gold production and increased capital
expenditure, partially offset by the decreased operating cost.
Damang
September 2010 June 2010
Gold produced - 000`oz 56.5 56.8
Yield - g/t 1.4 1.3
Total cash cost - US$/oz 666 704
Notional cash expenditure - US$/oz 879 881
NCE margin - % 28 26
Gold production decreased marginally from 56,800 ounces in the June quarter
to 56,500 ounces in the September quarter.
Total tonnes mined, including capital stripping at 3.8 million tonnes in the
September quarter was slightly higher than the 3.4 million tonnes achieved in
the June quarter. Ore mined was similar at 1.1 million tonnes and the strip
ratio achieved was 2.51 compared with the June quarter`s 1.96.
Tonnes processed at 1.2 million tonnes was slightly lower than the 1.3
million tonnes in the June quarter mainly due to milling more fresh high
grade ore.
Operating costs, including gold-in-process movements decreased from US$38
million (R286 million) in the June quarter to US$35 million (R260 million) in
the September quarter mainly due to lower tonnes mined and processed,
partially offset by increased power costs. Total cash cost decreased from
US$704 per ounce to US$666 per ounce.
Operating profit increased from US$30 million (R225 million) in the June
quarter to US$34 million (R252 million) in the September quarter. This was
due to the higher gold price received and the reduction in operating costs.
Capital expenditure increased from US$12 million (R87 million) in the June
quarter to US$13 million (R97 million) in the September quarter, with the
majority of the spend being on exploration and the owner mining project.
Notional cash expenditure decreased from US$881 per ounce in the June quarter
to US$879 per ounce in the September quarter, mainly as a result of the lower
operating cost.
South America region
Peru
Cerro Corona
September June
2010 2010
Gold produced - 000`oz 45.9 33.7
Copper produced - tonnes 10,250 10,500
Total equivalent gold produced - 000` eq oz 105.8 96.5
Total equivalent gold sold - 000` eq oz 113.7 90.2
Yield - gold - g/t 0.9 0.7
- copper - per cent 0.66 0.74
- combined - g/t 2.0 2.0
- US$/eq oz 354 369
Total cash cost
Notional cash expenditure - US$/eq oz 456 502
NCE margin - % 64 54
Gold price * - US$/oz 1,222 1,184
Copper price * - US$/t 7,141 7,090
NCE margin -% 64 54
* Average spot price used to calculate total equivalent gold produced
Gold produced increased from 33,700 ounces in the June quarter to 45,900
ounces in the September quarter and copper produced decreased from 10,500
tonnes to 10,250 tonnes. During the September quarter concentrate with
payable content of 48,400 ounces of gold was sold at an average gold price of
US$1,234 per ounce and 11,000 tonnes of copper were sold at an average copper
price of US$6,648 per tonne, net of treatment and refining charges.
Total tonnes mined decreased from 3.28 million tonnes in the June quarter to
3.15 million tonnes in the September quarter, reflecting lower waste mining.
Ore mined at 1.63 million tonnes was 9 per cent higher than the 1.49 million
tonnes in the June quarter resulting in a strip ratio of 0.94 compared with
1.2 in the June quarter.
The higher gold production compared with the June quarter was mainly due to
an increase of 8 per cent in ore processed, from 1.49 million tonnes in the
June quarter to 1.61 million tonnes in the September quarter and an increase
in metal recoveries, from 62 per cent in the June quarter to 67 per cent in
the September quarter for gold, and from 81 per cent to 85 per cent for
copper; partially offset by a reduction in copper head grade, from 0.91 per
cent in the June quarter to 0.78 per cent in the September quarter. Gold head
grade increased from 1.18 grams per tonne to 1.38 grams per tonne. The
increase in ore tonnes processed reflects a record throughput of 807 tonnes
per hour for the September quarter.
Gold yield for the September quarter was 0.9 grams per tonne, compared with
0.7 grams per tonne in the June quarter and copper yield was 0.66 per cent
compared with 0.74 per cent in the June quarter.
Operating costs, including gold-in-process movements, increased from US$32
million (R242 million) in the June quarter to US$39 million (R290 million) in
the September quarter. This was mainly due to an increase in the accrual for
statutory workers legal participation in line with the higher profit and a
gold-in-process charge to cost compared with a credit to cost in the June
quarter. Total cash cost was US$354 per equivalent ounce sold for the
September quarter compared with US$369 per equivalent ounce sold in the June
quarter, mainly reflecting the effect of higher equivalent ounces sold, which
offset the impact of the increase in operating costs.
Operating profit increased from US$67 million (R505 million) in the June
quarter to US$103 million (R758 million) in the September quarter, reflecting
the higher metal production and sales, together with tight cost controls.
Capital expenditure for the September quarter was US$11 million (R82
million), compared with US$14 million (R108 million) in the June quarter. The
lower expenditure during the September quarter was due to the timing of
expenditure.
Notional cash expenditure for the September quarter at US$456 per equivalent
ounce compares with US$502 per equivalent ounce in the June quarter, the
decrease being a result of the higher equivalent ounces produced and the
lower capital expenditure.
Australasia region
Australia
St Ives
September 2010 June 2010
Gold produced - 000`oz 117.9 117.5
Yield - heap leach - g/t 0.5 0.5
- milling - g/t 2.8 2.7
- combined - g/t 2.2 2.1
Total cash cost - A$/oz 744 780
- US$/oz 666 692
Notional cash expenditure - A$/oz 1,061 1,106
- US$/oz 950 981
NCE margin - % 22 19
Gold produced increased from 117,500 ounces in the June quarter to 117,900
ounces in the September quarter.
At the open pit operations total tonnes mined decreased from 8.71 million
tonnes in the June quarter to 5.00 million tonnes in the September quarter.
Total ore tonnes mined decreased from 1.72 million tonnes of ore mined to
1.20 million tonnes due to the utilisation of stockpiles. Grade increased
from 1.38 grams per tonne to 1.76 grams per tonne. The average strip ratio,
including capital waste, reduced from 4.3 in the June quarter to 3.3 in the
September quarter.
At the underground operations, ore mined increased from 387,600 tonnes at 5.1
grams per tonne in the June quarter to 418,600 tonnes at 5.2 grams per tonne
in the September quarter. The increased ore tonnes were predominantly due to
a build-up in production at the Naiad operation (an extension of Belleisle).
Gold produced from the Lefroy mill increased from 109,700 ounces to 110,400
ounces, due to an increase in head grade from 2.97 grams per tonne in the
June quarter to 3.10 grams per tonne in the September quarter. Production
from the heap leach facility at 7,500 ounces was 4 per cent lower than the
June quarter, due to maintenance of the secondary crusher.
Operating costs, including gold-in-process movements, decreased from A$89
million (R597 million) in the June quarter to A$84 million (R552 million) in
the September quarter. The decrease in costs was primarily due to a gold-in-
process credit associated with higher gold inventory at the end of the
quarter. Total cash cost decreased from A$780 per ounce (US$692 per ounce) to
A$744 per ounce (US$666 per ounce) as a result of the lower cost.
Operating profit increased from A$70 million (R470 million) to A$77 million
(R504 million), due to the lower costs.
Capital expenditure decreased from A$35 million (R232 million) to A$31
million (R203 million). Capital expenditure at Athena decreased from A$13
million in the June quarter to A$10 million in the September quarter due to a
decrease in capital development in line with the planned build-up. This
project is expected to have first stope ore produced in December 2010, on
schedule, with full production at this new mine in the third quarter of
calendar 2011.
Notional cash expenditure decreased from A$1,106 per ounce (US$981 per ounce)
in the June quarter to A$1,061 per ounce (US$950 per ounce) in the September
quarter, mainly due to lower capital expenditure.
Agnew
September 2010 June 2010
Gold produced - 000`oz 35.3 31.7
Yield - g/t 5.3 5.4
Total cash cost - A$/oz 706 838
- US$/oz 632 743
Notional cash expenditure - A$/oz 1,065 1,632
- US$/oz 954 1,447
NCE margin - % 22 (22)
Gold production increased from 31,700 ounces in the June quarter to 35,300
ounces in the September quarter. This increase was due to the implementation
of the revised mine plan at Kim which has alleviated previous access
restrictions and increased stope availability towards the latter half of the
quarter. Stope availability improved as rehabilitation of areas characterised
by poor ground conditions was systematically completed following stope
failures towards the end of the previous quarter.
Ore mined from underground increased from 134,000 tonnes at a head grade of
6.6 grams per tonne in the June quarter to 145,000 tonnes at a head grade of
8.8 grams per tonne in the September quarter. The grade increase was due to
renewed access to the high grade southern areas of the Kim South ore body.
Tonnes processed increased from 184,000 tonnes in the June quarter to 209,000
tonnes in the September quarter, with a marginal decrease in yield from 5.4
grams per tonne to 5.3 grams per tonne. Due to underground ore not being
sufficient to fill the total mill capacity, the resultant spare processing
capacity was used to treat 64,000 tonnes of lower grade material from surface
stockpiles.
Operating costs, including gold-in-process movements, decreased from A$27
million (R182 million) in the June quarter to A$25 million (R164 million) in
the September quarter, which included A$2 million credit to costs
attributable to a build-up of gold inventory. Total cash cost per ounce
decreased from A$838 per ounce (US$743 per ounce) to A$706 per ounce (US$632
per ounce) due to the increased production.
Operating profit increased from A$15 million (R101 million) in the June
quarter to A$23 million (R153 million) in the September quarter. This was
mainly due to the increased production.
Capital expenditure decreased from A$26 million (R176 million) in the June
quarter to A$11 million (R73 million) in the September quarter. The
acquisition of mining fleet to commence owner mining accounted for A$13
million of the capital expenditure for the June quarter.
Notional cash expenditure decreased from A$1,632 per ounce (US$1,447 per
ounce) in the June quarter to A$1,065 per ounce (US$954 per ounce) in the
September quarter due to the decrease in capital expenditure and increased
production.
Quarter ended 30 September 2010 compared
with quarter ended 30 September 2009
Group attributable gold production increased marginally from 906,000 ounces
for the quarter ended September 2009 to 908,000 ounces for the quarter ended
September 2010.
At the South African operations gold production decreased from 527,000 ounces
to 497,000 ounces. Driefontein`s gold production increased by 2 per cent from
189,500 ounces to 193,500 ounces due to an increase in volumes mined. At
Kloof, gold production decreased by 20 per cent from 161,500 ounces to
129,900 ounces mainly due to lower volumes and a lower Mine Call Factor. At
Beatrix, gold production decreased by 7 per cent from 110,500 ounces to
102,900 ounces due to lower mining volumes. South Deep`s gold production
increased by 8 per cent from 65,300 ounces to 70,700 ounces in line with the
build-up to plan.
At the West African operations total managed gold production increased from
226,500 ounces for the quarter ended September 2009 to 242,000 ounces for the
quarter ended September 2010. At Damang, gold production increased by 10 per
cent from 51,400 ounces to 56,500 ounces mainly due to the re-build of the
primary crusher in September 2009. Tarkwa`s production increased by 6 per
cent from 175,100 ounces to 185,500 ounces mainly due to an increase in CIL
throughput.
In South America, gold equivalent production at Cerro Corona increased from
88,500 ounces in the September 2009 quarter to 105,800 ounces in the
September 2010 quarter due to increased concentrate production and higher
copper prices relative to gold prices received in the September 2010 quarter.
At the Australasian operations, gold production increased by 5 per cent from
146,200 ounces in the September 2009 quarter to 153,200 ounces in the
September 2010 quarter. St Ives increased by 18 per cent from 100,300 ounces
to 117,900 ounces mainly due to increased tonnes processed at a higher head
grade. Production at Agnew decreased by 23 per cent from 45,900 ounces to
35,300 ounces, mainly due to the limited stope availability at Kim South.
Revenue increased by 22 per cent from R7,416 million (US$948 million) to
R9,053 million (US$1,230 million). The 20 per cent higher average gold price
at R289,329 per kilogram (US$1,223 per ounce) compares with R241,164 per
kilogram (US$959 per ounce) achieved for the quarter ended September 2009.
The Rand strengthened from US$1 = R7.82 to US$1 = R7.36 or 6 per cent, while
the Rand/Australian dollar weakened by 2 per cent from A$1 = R6.49 to R6.59.
Operating costs, including gold-in-process movements, increased from R4,629
million (US$592 million) to R5,132 million (US$697 million). The increase in
costs was mainly due to annual wage increases at all the operations, an
increase in electricity costs at the South African and Ghanaian operations
due to tariff increases and the increase in processing the South heap leach
at Tarkwa. At Cerro Corona, the increase in costs was due to the production
build- up and increased statutory workers participation in profit because of
the increase in earnings. Total cash cost for the Group increased from
R147,343 per kilogram (US$586 per ounce) to R164,898 per kilogram (US$697 per
ounce) due to the increase in costs and the introduction of royalties in
South Africa together with an increase in the royalty charge in Ghana from 3
to 5 per cent of revenue.
At the South African operations operating costs increased by 12 per cent from
R2,768 million (US$354 million) for the September 2009 quarter to R3,075
million (US$418 million) for the September 2010 quarter. This was due to
above inflation annual wage increases, a 25 per cent increase in electricity
costs and normal inflationary increases in stores and contractors, partially
offset by the cost saving initiatives implemented during the year. Total cash
cost at the South African operations increased from R162,553 per kilogram to
R195,627 per kilogram as a result of the increase in costs, the introduction
of the royalty and the 6 per cent lower production.
At the West African operations, operating costs including gold-in- process
movements increased from US$115 million to US$143 million. This was mainly
due to the increase in production and the increase in power costs. At the
South American operation, operating costs at Cerro Corona increased from
US$31 million in the September 2009 quarter to US$39 million in the September
2010 quarter in line with increased production and increased statutory
workers participation.
At the Australasian operations operating costs including gold-in- process
movements were similar at A$109 million.
Operating profit increased from R2,787 million (US$356 million) to R3,921
million (US$533 million).
The exceptional loss in the September 2010 quarter of R138 million (US$19
million) compared with a gain of R667 million (US$85 million) in the
September 2009 quarter. The loss in the September 2010 quarter was as a
result of voluntary separation packages of R118 million (US$16 million) and
costs incurred of R20 million (US$3 million) on business process re-
engineering at the South African, Ghanaian and Australian operations. The
gain in the September 2009 quarter was mainly as a result of a R447 million
(US$57 million) profit on the sale of our stake in Sino Gold, a R282 million
(US$37 million) profit on the sale of our Eldorado shares, partially offset
by a R57 million (US$7 million) impairment of sundry offshore exploration
investments.
After accounting for the sundry items and taxation, net earnings amounted to
R701 million (US$95 million), compared with R1,007 million (US$129 million)
for the quarter ended September 2009.
Earnings excluding exceptional items, gains and losses on foreign exchange,
financial instruments and losses of associates after taxation amounted to
R1,016 million (US$138 million) for the quarter ended September 2010 compared
with R625 million (US$80 million) for the quarter ended September 2009.
Post quarter-end developments
Business Process Re-engineering
Kloof and Driefontein
Earlier in the year, Business Process Re-engineering (BPR) initiatives
commenced at Driefontein, Kloof and Beatrix in South Africa, Tarkwa in Ghana
and St Ives in Australia. The BPR involves a review of the mines` underlying
organisational structures as well as the operational production processes
from the stope to the mill. The objective is to introduce a new business
blueprint, together with an appropriate organisational structure, which will
support sustainable gold output at a NCE margin of 20 per cent over the next
12 to 18 months.
As a first step in the review of the operations in the South Africa region we
have implemented restructuring at Driefontein and Kloof, whose senior
management structures have been merged in an effort to improve operational
and financial efficiencies and ensure long-term sustainability.
The details of the new Kloof/Driefontein complex restructuring include:
The Kloof and Driefontein executive offices and the regional office will be
combined into a new management team with the primary role of servicing the
new Kloof/Driefontein complex, but which also has governance oversight across
the South Africa region. The team will be based at the combined mine complex
and the regional office at Constantia will be closed by early December.
Kloof and Driefontein shafts and plants have been clustered into six
operating units each with its own Senior Manager responsible for safe
production as well as ensuring an appropriate cost and manpower base for each
operating unit. This will reduce the layers of management and increase the
span of control. The new operating units are:
- Driefontein 1 and 5 shafts
- Driefontein 2 and 4 shafts
- Driefontein 6, 7, 8 and 10 shafts
- Kloof 3 and 4 shafts
- Kloof Main, 7, 8 and 10 shafts,
- Reef and waste plants.
One of the key benefits of the new structure is that accountability,
responsibility and line of sight is devolved to a lower level.
- The operating units will be supported by site operations that provide
common services across the units.
- In addition, a strategic management office has been established and will
identify and implement cost reductions and revenue enhancing opportunities.
The aim is to reduce the rate of cost increases and improve the NCE margin.
- Financial reporting of the new Kloof/Driefontein complex will commence in
the quarter ending December 2010.
The South Africa region will now consist of three operations, namely the
Kloof/Driefontein complex, Beatrix and South Deep. The organisational design
of Beatrix, because of its geographic location, and South Deep, because of
its mechanised mining method are being reviewed in order to ensure that they
are fit for purpose in the new structure.
We have, over the last two years, conducted extensive preparatory work in
order to improve and sustain the South Africa region. The introduction of
NCE served as the starting point followed by an overview of the region`s
safety procedures and infrastructure, both of which have resulted in safer
and more sustainable operations. The restructuring of Kloof and Driefontein
is a natural progression to ensuring the sustainability of the region and we
are confident that this structure is the most optimal. With quality ore
bodies, existing infrastructure and good people, the South Africa region has
been and will continue to be the bedrock of Gold Fields.
Tarkwa
Re-engineering is focused on cost reductions from improved contractor
management and improved consumable usage. Initiatives include owner
maintenance to complement the savings and productivity improvements already
achieved since the move to owner mining.
St Ives
Re-engineering is focused on productivity improvements and cost reductions
across all areas. This programme will continue during 2011.
Exploration and corporate development
Exploration and corporate development
Exploration activity during the September quarter focused on four advanced
drilling and three initial drilling projects in Peru, Mali, Canada, Finland,
Kyrgyzstan, Australia and the Philippines, as well as near mine exploration
at St Ives, Agnew and Damang. Target generation work continued on five other
greenfields exploration projects, where initial drilling is expected to
commence in the December quarter. In addition, Gold Fields signed option
agreements in September 2010 to acquire a total of 60 per cent interest in
the undeveloped gold-copper Far Southeast deposit in the Philippines during
the next 18 months.
Advanced drilling projects
At the Chucapaca project in Peru (Gold Fields 51 per cent), drilling re-
commenced in July 2010 with six drills currently on site. Two more rigs are
expected to be added in the December quarter to accelerate completion of the
drilling required for the pre-feasibility study ("PFS") which is to be
completed during the September 2011 quarter. Other elements of the PFS,
including metallurgical, hydrogeology, geotechnical and waste rock
characterisation studies, are underway. This study is planned to be completed
in parallel with the resource delineation drilling.
At the Yanfolila project in southern Mali (Gold Fields 95 per cent), drilling
has been limited during the rainy season but is planned to ramp up to five
rigs in the December quarter. Assay results from the previously completed
resource definition drilling at Komana East and West continue to show
encouraging gold grades. Positive assay results have also been returned from
initial drilling at the Gonka, Sanioumale and the Badogo-Malikila satellite
targets located to the south and southeast of Komana and follow-up drilling
programmes are planned for these areas. Preliminary metallurgical tests on
core samples of the transitional and sulphide mineralisation from Komana East
indicate that direct cyanidation can achieve acceptable recoveries with low
cyanide consumption. Samples of the oxide mineralisation have yet to be
tested, however, recovery issues are not expected.
At the Talas project in Kyrgyzstan (Gold Fields 60 per cent), the mineral
resource estimate was finalised. Field activities have been suspended until
uncertainty surrounding the election of a new parliament is resolved.
At the Arctic Platinum project in Finland (Gold Fields 100 per cent), bench-
scale flotation and hydrometallurgical testing is ongoing. A drilling
programme to obtain sufficient material for pilot plant-scale tests is in the
planning stage and will commence in the December quarter. The pilot plant
test work will take up to nine months to complete after delivery of the
samples. Potential flowsheet and design updates will be made once the pilot
plant testing has been completed. Environmental baseline studies are in
progress over the Suhanko and Suhanko extension areas.
Initial drilling projects
At the East Lachlan joint ventures in New South Wales, Australia, where Gold
Fields has earned into an 80 per cent interest in two porphyry Au-Cu project
areas (Wellington North and Cowal East) and is earning into 80 per cent on
another two projects (including the Myall joint venture) with Clancy
Exploration Ltd (ASX: "CLY"), rains in August 2010 forced the suspension of
fieldwork. Drilling will continue in the December quarter. Encouraging assay
results from previous drilling at the Myall joint venture have returned
additional wide but relatively low grade copper intersections. Analysis of
the drilling results has identified a compelling Cu-Au target immediately
North West of these intercepts.
At the Batangas joint ventures in the Philippines, where Gold Fields can earn
up to a 75 per cent interest in three joint ventures with Mindoro Resources
Ltd. (TSX.V: "MIO"), two diamond holes tested the Ulupong epithermal Au-Cu
target with indifferent results; leading to a downgrading of this target.
Reconnaissance geological mapping at the El Paso project has identified a new
porphyry target with malachite-azurite staining along fractures and
chalcopyrite- covellite-bornite disseminations.
Drilling resumed with two diamond drills in early July 2010 at the Woodjam
project in British Columbia, Canada, where Gold Fields can earn up to a 70
per cent interest in two separate joint ventures with the Woodjam Partners
(Fjordland Exploration Inc. (TSX.V:"FEX") and Cariboo Rose Resources (TSX.V:
"CRB")). During the quarter, drilling has focused on the Southeast, Takom,
Deerhorn and Corner Lake porphyry Cu-Au target areas. Step-out drilling is
currently in progress to find the limits of mineralisation on the northwest
side of the Southeast Zone and the south side of the Deerhorn target.
Drilling is also planned to test geophysical targets to the east of the
Megabucks zone.
Near mine exploration
St Ives
Assay results from the initial Athena underground infill drilling returned
positive results during July 2010. The first level of development was
completed during August 2010 with positive reconciliation to the model. This,
coupled with the recent drilling results, provides confidence for the near
term development of this new mine. Infill drilling at Hamlet to upgrade the
Inferred Resource to Indicated status was completed during October 2010.
Results from the deep drilling at Yorrick are demonstrating additional high
grade shoots about 100 metres deeper than previously defined.
Agnew
Directional drilling of Main Lode North was completed on the 9750mRL level.
Assay results indicate variable but generally moderate grades and wide widths
of mineralisation, which suggest that Main Lode North may be amenable to a
bulk mining method (e.g. sub-level caving) or a combination of bulk and
selective mining methods. A study is planned to evaluate the optimum mining
method to extract this resource.
Damang
Drilling of the Damang Deeps phase 1 extensional target completed two holes,
with both intersecting the full suite of favourable lithologies. Typical
Damang-style hydrothermal mineralisation was intersected in the dolerite
units. Assays for this drilling are still pending. Infill drilling continued
at Juno, Rex and Greater Amoanda with positive results being returned from
Juno during September 2010. At the Amoanda North extension, scout drilling
intersected the north plunging extension of the ore body adding a further 120
metre of strike to the north of the modeled resource. Initial assays received
are positive.
Cerro Corona
There has been no activity on the Consolidada de Hualgayoc joint venture (50
per cent Gold Fields) since exploration was suspended in 2009 due to
community issues. A follow-up drilling programme is being designed for the
newly acquired Sylvita Concession to the immediate north of the Cerro Corona
pit.
Corporate
Moody`s assigns investment grade credit rating
Moody`s Investor Services ("Moody`s") assigned Gold Fields a first-time
`Baa3` senior unsecured issuer rating on 17 September 2010. This investment
grade rating comes with a stable outlook.
Moody`s said that the rating reflected Gold Fields` position as the world`s
fourth-largest gold producer as well as the Group`s very sizeable reserve
base and industry-leading reserve life in excess of 20 years. The stable
outlook was based on the expectation that Gold Fields would maintain healthy
operating margins and a conservative financial profile.
In addition, Standard & Poor`s Rating Services (S&P) has maintained an
investment grade rating on Gold Fields of `BBB-` with a stable outlook, since
March 2009.
Option agreement in Philippines
On 20 September 2010 Gold Fields announced that it has entered into option
agreements with Lepanto Consolidated Mining Company (Lepanto), a company
listed in the Philippines, and Liberty Express Assets (Liberty), a private
holding company, to acquire a 60 per cent interest in the undeveloped gold-
copper Far Southeast (FSE) deposit in the Philippines.
The agreements provide Gold Fields with an 18 month option on FSE, during
which time a major drilling programme will be conducted as part of a
feasibility study on FSE. Gold Fields was required to pay US$10 million in
option fees to Lepanto and US$44 million as a non-refundable down-payment to
Liberty upon signing of the option agreements, which payments have been made
since the closure of this reporting period. Should Gold Fields, after a 12-
month period, decide to proceed with the option, a further non- refundable
down-payment of US$66 million will be payable to Liberty, with the final
payment of US$220 million payable on 20 March 2012 should Gold Fields
exercise the option. The total pre- agreed acquisition price for a 60 per
cent interest in FSE is US$340 million inclusive of all of the above down-
payments and the option fee.
Debut US$1 billion bond closure
A 10-year US$1 billion bond offer to international investors was successfully
completed on 7 October 2010. This transaction was executed on 30 September
2010, where the final order book was more than two times oversubscribed from
high quality accounts. The final coupon of 4.875 per cent per annum is the
lowest US$ rate achieved by a South African corporate in the international US
dollar bond market.
Paul Schmidt, Chief Financial Officer, said: "The 10 year tenor of this bond
will fit nicely with our long term quality assets without increasing the
Group`s debt position. We will have more than US$1.3 billion of committed
bank facilities available after the net proceeds of the bond have been used
to refinance some bank facilities and commercial paper notes in issue. The
bond significantly strengthens our liquidity and debt maturity profile".
New housing complex
On 1 October 2010 a new employee housing project was opened in the Glenharvie
community near Kloof as part of Gold Fields` R550 million, five year housing
programme of which R280 million has been spent to date. The new Grootkloof
complex, representing an investment of R25 million, will offer housing
accommodation to an additional 100 Kloof employees and their families.
The complex is an integral part of our continuing programme to renovate
housing, construct new family homes and upgrade and de-densify our high-
density accommodation. Significant progress has been made in this regard. At
present, room density in the hostels is just over two per room, from eight
per room in 2006. Around 21,000 employees are accommodated by Gold Fields in
high-density accommodation. The Employee Housing programme is part of Gold
Fields` total wellbeing programme called "24 Hours in the Life of a Gold
Fields Employee". This programme is designed to improve every facet of the
health and well-being of employees, and addresses the key issues of safe
production, healthcare, nutrition, accommodation, sport and recreation as
well as education and training.
South Deep new order mining right executed
On 5 August 2010 Gold Fields announced that the Department of Mineral
Resources (DMR) of South Africa had executed the new order mining right for
South Deep.
BEE transaction approved
The terms of three empowerment transactions have been finalised and will
enable us to achieve our 2014 Black Economic Empowerment (BEE) ownership
targets. These deals include an Employee Share Option plan for 10.75 per cent
of GFIMSA, a broad-based BEE transaction for 10 per cent of South Deep and a
broad-based BEE transaction for 1 per cent of GFIMSA, excluding South Deep.
The BEE circular has been posted to shareholders and is also available on the
company`s website.
Changes in leadership
After more than 25 years of outstanding service to Gold Fields, Vishnu
Pillay, Executive Vice President and Head of the South Africa region,
announced his retirement from Gold Fields at the beginning of October. He
will leave the company by the end of December 2010. Vishnu has been a key
architect of the significant improvement in safety in South Africa over the
past few years, as well as the restructuring of the region.
Tim Roland, Vice President Technical - South Africa, is currently acting as
Executive Vice President and Head of the South Africa region.
Outlook
The guidance for the year ended 30 June 2011, is maintained with attributable
equivalent gold production estimated at between 3.5 million ounces and 3.8
million ounces. Total cash cost is estimated at between US$650 per ounce
(R157,000 per kilogram) and US$690 per ounce (R166,000 per kilogram).
Notional cash expenditure (NCE) per ounce/kilogram, defined as operating
costs plus capital expenditure divided by gold production, is estimated at
between US$925 per ounce (R223,000 per kilogram) and US$975 per ounce
(R235,000 per kilogram). This estimate is based on an exchange rate of
R/US$7.50 and US$/A$0.88. The above is subject to the forward looking
statement on page 1 and 27.
The estimated financial information has not been reviewed and reported on by
the Gold Fields` auditors in accordance with Section 8.40 (a) of the Listing
Requirements of the JSE Limited.
Change in year-end
Gold Fields is in the process of changing its financial year-end from June to
December to align the Group reporting with peers in the gold mining industry.
This will result in a six month reporting period ending 31 December 2010,
followed by the new financial year ending 31 December 2011.
Basis of accounting
The condensed consolidated preliminary financial information is prepared in
accordance with IAS 34 Interim Financial Reporting. The accounting policies
and disclosure requirements used in the preparation of this report are
consistent with those applied in the previous financial year except for the
adoption of applicable revised and/or new standards issued by the
International Accounting Standards Board.
N.J. Holland
Chief Executive Officer
4 November 2010
Income statement
International Financial Reporting Standards Basis
Figures are in millions unless otherwise stated
Quarter
September June September
SOUTH AFRICAN RAND 2010 2010 2009
Revenue 9,052.8 8,802.7 7,415.8
Operating costs, net (5,132.0) (5,064.7) (4,628.6)
- Operating costs (5,173.4) (5,102.5) (4,644.1)
- Gold inventory change 41.4 37.8 15.5
Operating profit 3,920.8 3,738.0 2,787.2
Amortisation and depreciation (1,442.5) (1,368.2) (1,173.8)
Net operating profit 2,478.3 2,369.8 1,613.4
Net interest paid (69.6) (33.4) (49.2)
Share of (loss)/gain of associates after
taxation (217.6) 86.2 (15.8)
(Loss)/gain on foreign exchange (11.1) 6.0 (62.7)
(Loss)/gain on financial instruments (2.6) 19.1 (131.8)
Share-based payments (119.0) (46.1) (120.1)
Other (23.7) (119.9) (5.4)
Exploration (123.5) (185.5) (132.8)
Profit before taxation and exceptional
items 1,911.2 2,096.2 1,095.6
Exceptional (loss)/gain (138.3) (144.1) 666.8
Profit before taxation 1,772.9 1,952.1 1,762.4
Mining and income taxation (849.0) (864.5) (638.1)
- Normal taxation (459.2) (339.6) (332.5)
- Royalties (217.5) (220.8) (97.5)
- Deferred taxation (172.3) (304.1) (208.1)
Net profit 923.9 1,087.6 1,124.3
Attributable to:
- Owners of the parent 700.9 899.9 1,007.2
- Non-controlling interest 223.0 187.7 117.1
Exceptional items:
Profit on sale of investments 1.0 63.8 728.7
Profit on sale of assets 2.7 0.5 1.0
Restructuring costs (142.0) (11.8) (5.8)
Impairment of investments - (196.6) (57.1)
Total exceptional items (138.3) (144.1) 666.8
Taxation 50.0 (7.0) (114.6)
Net exceptional items after taxation and
non-controlling interest (88.3) (151.1) 552.2
Net earnings 700.9 899.9 1,007.2
Net earnings per share (cents) 99 128 143
Diluted earnings per share (cents) 98 125 141
Headline earnings 698.5 1,039.1 451.6
Headline earnings per share (cents) 99 147 64
Net earnings excluding gains and losses
on foreign exchange, financial
instruments, exceptional 1,016.3 945.4 624.8
items and share of gain/(loss) of
associates after taxation
Net earnings per share excluding gains
and losses on foreign exchange,
financial instruments, 144 134 89
exceptional items and share of
gain/(loss) of associates after taxation
(cents)
Gold sold - managed kg 31,289 30,623 30,750
Gold price received R/kg 289,329 287,454 241,164
Total cash cost R/kg 164,898 166,215 147,343
Statement of comprehensive income
International Financial Reporting Standards Basis
Figures are in millions unless otherwise stated
Quarter
September June September
SOUTH AFRICAN RAND 2010 2010 2009
Net profit for the quarter 923.9 1,087.6 1,124.3
Other comprehensive (expenses)/income, net
of tax (620.0) 170.4 (953.2)
Marked to market valuation of listed
investments 41.8 19.4 (197.3)
Currency translation adjustments and other (671.4) 155.8 (846.2)
Share of equity investee`s other
comprehensive income 7.0 (2.4) 11.7
Deferred taxation on marked to market
valuation of listed investments 2.6 (2.4) 78.6
Total comprehensive income for the quarter 303.9 1,258.0 171.1
Attributable to:
- Owners of the parent 82.5 1,066.1 78.7
- Non-controlling interest 221.4 191.9 92.4
303.9 1,258.0 171.1
Income statement
International Financial Reporting Standards Basis
Figures are in millions unless otherwise stated
Quarter
September June September
UNITED STATES DOLLARS
2010 2010 2009
Revenue 1,230.0 1,169.2 948.3
Operating costs, net (697.3) (673.1) (591.9)
- Operating costs (702.9) (678.1) (593.9)
- Gold inventory change 5.6 5.0 2.0
Operating profit 532.7 496.1 356.4
Amortisation and depreciation (196.0) (181.7) (150.1)
Net operating profit 336.7 314.4 206.3
Net interest paid (9.5) (4.4) (6.3)
Share of (loss)/gain of associates after
taxation (29.6) 11.4 (2.0)
(Loss)/gain on foreign exchange (1.5) 0.8 (8.0)
(Loss)/gain on financial instruments (0.4) 2.4 (16.9)
Share-based payments (16.2) (6.3) (15.4)
Other (3.1) (15.9) (0.7)
Exploration (16.7) (24.7) (17.0)
Profit before taxation and exceptional
items 259.7 277.7 140.0
Exceptional (loss)/gain (18.8) (18.6) 85.3
Profit before taxation 240.9 259.1 225.3
Mining and income taxation (115.4) (114.7) (81.6)
- Normal taxation (62.4) (45.1) (42.5)
- Royalties (29.6) (29.2) (12.5)
- Deferred taxation (23.4) (40.4) (26.6)
Net profit 125.5 144.4 143.7
Attributable to:
- Owners of the parents 95.2 119.5 128.7
- Non-controlling interest 30.3 24.9 15.0
Exceptional items:
Profit on sale of investments 0.1 8.8 93.2
Profit on sale of assets 0.4 - 0.1
Restructuring costs (19.3) (1.6) (0.7)
Gain on financial instrument - 0.1 -
Impairment of investments - (25.9) (7.3)
Total exceptional items (18.8) (18.6) 85.3
Taxation 6.8 (1.0) (14.7)
Net exceptional items after taxation and
non-controlling interest (12.0) (19.6) 70.6
Net earnings 95.2 119.5 128.7
Net earnings per share (cents) 13 17 18
Diluted earnings per share (cents) 13 17 18
Headline earnings 94.8 137.8 57.7
Headline earnings per share (cents) 13 20 8
Net earnings excluding gains and losses on
foreign exchange, financial instruments,
exceptional
items and share of gain/(loss) of 138.1 125.4 79.9
associates after taxation
Net earnings per share excluding gains and
losses on foreign exchange, financial
instruments, exceptional items and share
of gain/(loss) of associates after
taxation (cents) 20 18 11
South African rand/United States dollar
conversion rate 7.36 7.51 7.82
South African rand/Australian dollar
conversion rate 6.59 6.66 6.49
Gold sold - managed oz (000) 1,006 985 989
Gold price received US$/oz 1,223 1,191 959
Total cash cost US$/oz 697 688 586
Statement of comprehensive income
International Financial Reporting Standards Basis
Figures are in millions unless otherwise stated
Quarter
September June September
UNITED STATES DOLLARS
2010 2010 2009
Net profit for the quarter 125.5 144.4 143.7
Other comprehensive income/(expenses), net
of tax 376.8 (154.0) 372.8
Marked to market valuation of listed
investments 5.7 2.5 (25.3)
Currency translation adjustments and other 369.7 (155.9) 386.5
Share of equity investee`s other
comprehensive income 1.0 (0.3) 1.5
Deferred taxation on marked to market
valuation of listed investments 0.4 (0.3) 10.1
Total comprehensive income/(loss) for the
quarter 502.3 (9.6) 516.5
Attributable to:
- Owners of the parent 442.4 (23.5) 474.8
- Non-controlling interest 59.9 13.9 41.7
502.3 (9.6) 516.5
Reconciliation of headline earnings with net earnings
International Financial Reporting Standards Basis
Figures are in millions unless otherwise stated
SOUTH AFRICAN RAND UNITED STATES DOLLARS
September June September June
2010 2010 2010 2010
Net earnings 700.9 899.9 95.2 119.5
Profit on sale of investments (1.0) (63.8) (0.1) (8.8)
Taxation effect on sale of
investments 0.3 6.9 - 1.2
Profit on sale of assets (2.7) (0.5) (0.4) -
Taxation effect on sale of assets 1.0 - 0.1 -
Impairment of investments - 196.6 - 25.9
Headline earnings 698.5 1,039.1 94.8 137.8
Headline earnings per share - cents 99 147 13 20
Based on headline earnings as
given above divided by
706,090,891 (June 2010 -
705,826,038) being the weighted
average number of ordinary
shares in issue.
Statement of financial position
International Financial Reporting Standards Basis
Figures are in millions unless otherwise stated
SOUTH AFRICAN RAND UNITED STATES DOLLARS
September June September June
2010 2010 2010 2010
Property, plant and equipment 52,741.2 52,813.4 7,502.3 6,976.7
Goodwill 4,458.9 4,458.9 634.3 589.0
Non-current assets 1,028.9 1,012.5 146.4 133.8
Investments 885.4 1,035.9 125.9 136.8
Current assets 10,073.6 9,019.5 1,432.9 1,191.5
- Other current assets 5,760.4 5,229.0 819.4 690.8
- Cash and deposits 4,313.2 3,790.5 613.5 500.7
Total assets 69,188.0 68,340.2 9,841.8 9,027.8
Shareholders` equity 45,393.2 45,448.9 6,457.0 6,003.8
Deferred taxation 7,214.6 7,142.7 1,026.3 943.6
Long-term loans 4,639.8 3,255.1 660.0 430.0
Environmental rehabilitation
provisions 2,305.5 2,295.5 328.0 303.2
Post-retirement health care
provisions 22.1 22.1 3.1 2.9
Current liabilities 9,612.8 10,175.9 1,367.4 1,344.3
- Other current liabilities 4,863.3 4,943.9 691.8 653.2
- Current portion of
long-term loans 4,749.5 5,232.0 675.6 691.1
Total equity and liabilities 69,188.0 68,340.2 9,841.8 9,027.8
South African rand/US dollar
conversion rate 7.03 7.57
South African rand/Australian
dollar conversion rate 6.71 6.57
Net debt 5,076.1 4,696.6 722.1 620.4
Hedging / Derivatives
The Group`s policy is to remain unhedged to the gold price. However, hedges
are sometimes undertaken on a project specific basis 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.
South Africa forward cover contracts*
South African rand forward cover contracts were taken out to cover
commitments of the South African operations in various currencies.
Outstanding at the end of September 2010 were the following contracts:
- US$/ZAR - US$3 million in total, with a negative marked to market value of
US$0.2 million
- A$/ZAR - A$4 million in total, with a negative marked to market value of
US$0.1 million
* Do not qualify for hedge accounting and will be accounted for as derivative
financial instruments in the income statement.
Condensed statement of changes in equity
International Financial Reporting Standards Basis
Figures are in millions unless otherwise stated
SOUTH AFRICAN RAND
SEPTEMBER 2010 QUARTER
Share capital and Other Retained
premium reserves earnings
Balance as at 30 June 2010 31,522.4 (1,470.0) 12,590.5
Total comprehensive
(expenses)/income - (618.4) 700.9
Profit for the quarter - - 700.9
Other comprehensive expenses - (618.4) -
Dividends paid - - (494.4)
Share-based payments - 119.0 -
Exercise of employee share options 15.8 - -
Balance as at 30 September 2010 31,538.2 (1,969.4) 12,797.0
Non-controlling Total
interest equity
Balance as at 30 June 2010 2,806.0 45,448.9
Total comprehensive (expenses)/income 221.4 303.9
Profit for the quarter 223.0 923.9
Other comprehensive expenses (1.6) (620.0)
Dividends paid - (494.4)
Share-based payments - 119.0
Exercise of employee share options - 15.8
Balance as at 30 September 2010 3,027.4 45,393.2
UNITED STATES DOLLARS
SEPTEMBER 2010 QUARTER
Share capital Other Retained
and premium reserves earnings
Balance as at 30 June 2010 4,597.3 (682.9) 1,718.7
Total comprehensive income - 347.2 95.2
Profit for the quarter - - 95.2
Other comprehensive income - 347.2 -
Dividends paid - - (67.4)
Share-based payments - 16.2 -
Exercise of employee share options 2.1 - -
Balance as at 30 September 2010 4,599.4 (319.5) 1,746.5
Non-controlling Total
interest equity
Balance as at 30 June 2010 370.7 6,003.8
Total comprehensive income 59.9 502.3
Profit for the quarter 30.3 125.5
Other comprehensive income 29.6 376.8
Dividends paid - (67.4)
Share-based payments - 16.2
Exercise of employee share options - 2.1
Balance as at 30 September 2010 430.6 6,457.0
SOUTH AFRICAN RAND
SEPTEMBER 2009 QUARTER
Share capital and Other Retained
premium reserves earnings
Balance as at 30 June 2009 31,465.6 (1,135.7) 9,876.2
Total comprehensive
(expenses)/income - (928.5) 1,007.2
Profit for the quarter - - 1,007.2
Other comprehensive expenses - (928.5) -
Dividends paid - - (564.1)
Share-based payments - 120.1 -
Transactions with minority
interest - - -
Exercise of employee share options 13.2 - -
Balance as at 30 September 2009 31,478.8 (1,944.1) 10,319.3
Non-controlling Total
interest equity
Balance as at 30 June 2009 2,463.3 42,669.4
Total comprehensive (expenses)/income 92.4 171.1
Profit for the quarter 117.1 1,124.3
Other comprehensive expenses (24.7) (953.2)
Dividends paid - (564.1)
Share-based payments -
120.1
Transactions with minority interest 56.3 56.3
Exercise of employee share options - 13.2
Balance as at 30 September 2009 2,612.0 42,466.0
UNITED STATES DOLLARS
SEPTEMBER 2009 QUARTER
Share capital and Other Retained
premium reserves earnings
Balance as at 30 June 2009 4,589.9 (959.2) 1,357.7
Total comprehensive income - 346.1 128.7
Profit for the quarter - - 128.7
Other comprehensive income - 346.1 -
Dividends paid - - (72.6)
Share-based payments - 15.4 -
Transactions with minority interest - - -
Exercise of employee share options 1.7 - -
Balance as at 30 September 2009 4,591.6 (597.7) 1,413.8
Non-controlling Total
interest equity
Balance as at 30 June 2009 305.6 5,294.0
Total comprehensive income 41.7 516.5
Profit for the quarter 15.0 143.7
Other comprehensive income 26.7 372.8
Dividends paid - (72.6)
Share-based payments -
15.4
Transactions with minority interest 7.1 7.1
Exercise of employee share options - 1.7
Balance as at 30 September 2009 354.4 5,762.1
Statement of cash flows
International Financial Reporting Standards Basis
Figures are in millions unless otherwise stated
SOUTH AFRICAN RAND Quarter
September June September
2010 2010 2009
Cash flows from operating activities 2,250.7 3,649.7 1,263.0
Profit before tax and exceptional items 1,911.2 2,096.2 1,095.6
Exceptional items (138.3) (144.1) 666.8
Amortisation and depreciation 1,442.5 1,368.2 1,173.8
Change in working capital (753.2) 767.0 (506.6)
Taxation paid (623.3) (545.5) (704.6)
Other non-cash items 411.8 107.9 (462.0)
Dividends paid (494.4) (175.2) (564.1)
Ordinary shareholders (494.4) - (564.1)
Non-controlling interest holders - (175.2) -
Cash flows from investing activities (2,228.0) (1,890.2) (1,781.9)
Capital expenditure - additions (2,225.4) (2,156.9) (1,746.3)
Capital expenditure - proceeds on disposal 28.7 2.4 3.0
Purchase of subsidiaries - - (301.1)
Royalty termination - - (1,998.9)
Purchase of investments (22.5) (3.6) 3.8
Proceeds on the disposal of investments 1.0 339.8 2,266.3
Environmental and post-retirement health
care payments (9.8) (71.9) (8.7)
Cash flows from financing activities 1,188.8 (665.9) 644.0
Loans received 4,013.1 2,444.1 3,369.4
Loans repaid (2,840.1) (3,001.0) (2,738.6)
Non-controlling interest holders loans repaid - (116.4) -
Shares issued 15.8 7.4 13.2
Net cash inflow/(outflow) 717.1 918.4 (439.0)
Translation adjustment (194.4) 47.2 (87.1)
Cash at beginning of period 3,790.5 2,824.9 2,803.9
Cash at end of period 4,313.2 3,790.5 2,277.8
*Cash flow before financing activities
and dividend payments 22.7 1,759.5 (518.9)
UNITED STATES DOLLARS
Quarter
September June September
2010 2010 2009
Cash flows from operating activities 308.0 482.1 165.3
Profit before tax and exceptional items 259.7 277.7 140.0
Exceptional items (18.8) (18.6) 85.3
Amortisation and depreciation 196.0 181.7 150.1
Change in working capital (102.3) 100.9 (64.8)
Taxation paid (82.6) (73.6) (86.2)
Other non-cash items 56.0 14.0 (59.1)
Dividends paid (67.4) (23.1) (72.6)
Ordinary shareholders (67.4) - (72.6)
Non-controlling interest holders - (23.1) -
Cash flows from investing activities (302.8) (239.7) (219.0)
Capital expenditure - additions (302.4) (286.5) (223.3)
Capital expenditure - proceeds on disposal 3.9 0.3 0.4
Purchase of subsidiaries - - (37.7)
Royalty termination - - (257.1)
Purchase of investments (3.1) (0.4) 0.5
Proceeds on the disposal of investments 0.1 56.4 299.4
Environmental and post-retirement health
care payments (1.3) (9.5) (1.2)
Cash flows from financing activities 169.4 (88.0) 68.2
Loans received 557.4 322.9 433.0
Loans repaid (390.1) (396.5) (366.5)
Non-controlling interest holders loans repaid - (15.4) -
Shares issued 2.1 1.0 1.7
Net cash inflow/(outflow) 107.2 131.3 (58.1)
Translation adjustment 5.6 (14.9) 19.3
Cash at beginning of period 500.7 384.3 347.9
Cash at end of period 613.5 500.7 309.1
*Cash flow before financing activities
and dividend payments 5.2 242.4 (53.7)
*Cash flow before financing activities is defined as the sum of cash flows
from operating activities and cash flows from investing activities.
Debt maturity ladder
Figures are in millions unless otherwise stated
31 Dec 2010 31 Dec 2011 31 Dec
2012
Loan facilities
(including preference shares and
commercial paper)
Rand million 5,415.7 739.8 1,500.0
US dollar million 10.0 540.0 40.0
Dollar debt translated to rand 70.3 3,796.2 281.2
Total (R`m) 5,486.0 4,536.0 1,781.2
Utilisation - Loan facilities
(including preference shares and
commercial paper)
Rand million 2,993.5 1,474.8 -
US dollar million 10.0 540.0 40.0
Dollar debt translated to rand 70.3 3,796.2 281.2
Total (R`m) 3,063.8 5,271.0 281.2
Long-term loans per balance sheet (R`m)
Current portion of long-term loans
per balance sheet (R`m)
Total loans per balance sheet (R`m)
1 Jan 2013
to
31 Dec 2015 Total
Loan facilities
(including preference shares and commercial paper)
Rand million 1,500.0 9,155.5
US dollar million 560.0 1,150.0
Dollar debt translated to rand 3,936.8 8,084.5
Total (R`m) 5,436.8 17,240.0
Utilisation - Loan facilities
(including preference shares and commercial paper)
Rand million - 4,468.3
US dollar million 110.0 700.0
Dollar debt translated to rand 773.3 4,921.0
Total (R`m) 773.3 9,389.3
Long-term loans per balance sheet (R`m) 4,639.8
Current portion of long-term loans per balance sheet (R`m) 4,749.5
Total loans per balance sheet (R`m) 9,389.3
Exchange rate: US$1 = R7.03 being the closing rate at the end of the
September 2010 quarter.
Pro forma debt maturity ladder reflecting US$1 billion bond issue
On 7 October 2010, Orogen Holdings (BVI) Limited, a wholly owned subsidiary
of Gold Fields, issued 10 year, US$1 billion of notes (the "Notes") due 7
October 2020 (the "Bond"). The Notes are unsecured and unsubordinated, and
are fully and unconditionally guaranteed by Gold Fields and certain of its
subsidiaries. The Notes will attract interest at a fixed rate of 4.875 per
cent per annum.
The Group intends to use the net proceeds of the Bond (net of issuance costs
and issue discount) to repay certain existing bank facilities and commercial
paper notes in issue and for general corporate purposes. The Bond
significantly strengthens the liquidity and debt maturity profile.
The table below presents the Group`s indebtedness as at 30 September 2010,
adjusted to show the effect of the issue of the Bond and the application of
the net proceeds thereof as discussed above, as if the Bond and repayment of
indebtedness had been completed as at 30 September 2010. The debt maturity
table below has been prepared for illustrative purposes only and, because of
its nature, the table discloses a hypothetical situation and does not,
therefore, represent the Group`s actual financial position or results.
Figures are in millions unless otherwise stated
31 Dec 2010 31 Dec 2011 31 Dec
2012
Pro forma: Loan facilities
(including US$ bond, preference
shares and commercial paper)
Rand million 2,123.7 739.8 1,500.0
US dollar million 10.0 540.0 40.0
Dollar debt translated to rand 70.3 3,796.2 281.2
Total (R`m) 2,194.0 4,536.0 1,781.2
Pro forma :Utilisation- Loan facilities
(including US$ bond, preference
shares and commercial paper)
Rand million 304.9 739.8 -
US dollar million 10.0 40.0 40.0
Dollar debt translated to rand 70.3 281.2 281.2
Total (R`m) 375.2 1,021.0 281.2
Pro forma long-term loans per
balance sheet (R`m)
Pro forma current portion of
long-term loans per balance sheet (R`m)
Total loans per balance sheet (R`m)
1 Jan 2013
to
31 Dec 2020 Total
Pro forma: Loan facilities
(including US$ bond, preference shares and commercial
paper)
Rand million 1,500.0 5,863.5
US dollar million 1,547.0 2,137.0
Dollar debt translated to rand 10,875.4 15,023.1
Total (R`m) 12,375.4 20,886.6
Pro forma :Utilisation- Loan facilities
(including US$ bond, preference shares and commercial
paper)
Rand million - 1,044.7
US dollar million 1,097.0 1,187.0
Dollar debt translated to rand 7,711.9 8,344.6
Total (R`m) 7,711.9 9,389.3
Pro forma long-term loans per balance sheet (R`m) 8,063.4
Pro forma current portion of long-term loans per
balance sheet (R`m) 1,325.9
Total loans per balance sheet (R`m) 9,389.3
Exchange rate: US$1 = R7.03 being the closing rate at the end of the
September 2010 quarter.
Operating and financial results
SOUTH AFRICAN RAND South Africa Region
Total
Mine
Operations Total Driefontein
Kloof
Operating Results
Ore milled/treated
(000 tonnes)
September 2010 14,510 4,059 1,521 1,106
June 2010 14,863 3,931 1,594 1,157
Yield (grams per tonne)
September 2010 2.1 3.8 4.0 3.7
June 2010 2.1 3.9 3.6 3.8
Gold produced (kilograms)
September 2010 31,042 15,458 6,017 4,041
June 2010 30,818 15,184 5,783 4,369
Gold sold (kilograms)
September 2010 31,289 15,458 6,017 4,041
June 2010 30,623 15,184 5,783 4,369
Gold price received
(Rand per kilogram)
September 2010 289,329 287,929 288,150 287,800
June 2010 287,454 289,482 289,538 289,082
Total cash cost
(Rand per kilogram)
September 2010 164,898 195,627 171,780 219,277
June 2010 166,215 187,770 175,584 196,201
Notional cash expenditure
(Rand per kilogram)
September 2010 238,348 284,118 229,666 308,488
June 2010 235,223 272,669 233,910 274,319
Operating costs
(Rand per tonne)
September 2010 357 758 682 823
June 2010 343 739 639 763
Financial Results
(Rand million)
Revenue
September 2010 9,052.8 4,450.8 1,733.8 1,163.0
June 2010 8,802.7 4,395.5 1,674.4 1,263.0
Operating costs, net
September 2010 (5,132.0) (3,075.1) (1,038.0) (910.7)
June 2010 (5,064.7) (2,904.5) (1,018.8) (882.9)
- Operating costs
September 2010 (5,173.4) (3,075.1) (1,038.0) (910.7)
June 2010 (5,102.5) (2,904.5) (1,018.8) (882.9)
- Gold inventory change
September 2010 41.4 - - -
June 2010 37.8 - - -
Operating profit
September 2010 3,920.8 1,375.7 695.8 252.3
June 2010 3,738.0 1,491.0 655.6 380.1
Amortisation of
mining assets
September 2010 (1,406.8) (715.5) (220.3) (223.1)
June 2010 (1,328.4) (660.8) (190.0) (209.5)
Net operating profit
September 2010 2,514.0 660.2 475.5 29.2
June 2010 2,409.6 830.2 465.6 170.6
Other expenses
September 2010 (244.1) (136.2) (23.5) (41.6)
June 2010 (220.9) (140.4) (28.5) (46.6)
Profit/(loss)
before taxation
September 2010 2,269.9 524.0 452.0 (12.4)
June 2010 2,188.7 689.8 437.1
124.0
Mining and income taxation
September 2010 (802.6) (152.8) (127.6) 28.0
June 2010 (879.3) (277.3) (167.2) (54.2)
- Normal taxation
September 2010 (411.5) (31.9) (44.0) 13.1
June 2010 (346.8) (88.2) (83.9) (3.2)
- Royalties
September 2010 (217.6) (46.4) (32.8) (5.8)
June 2010 (220.7) (48.3) (34.3) (6.8)
- Deferred taxation
September 2010 (173.5) (74.5) (50.8) 20.7
June 2010 (311.8) (140.8) (49.0) (44.2)
Profit/(loss) before
exceptional items
September 2010 1,467.3 371.2 324.4 15.6
June 2010 1,309.4 412.5 269.9 69.8
Exceptional items
September 2010 (121.3) (111.2) (35.9) (51.8)
June 2010 (9.2) (9.1) (0.9)
(2.6)
Net profit/(loss)
September 2010 1,346.0 260.0 288.5 (36.2)
June 2010 1,300.2 403.4 269.0 67.2
September 2010 1,427.6 329.0 310.8 (4.1)
Net profit/(loss)
excluding gains
and losses on
foreign exchange,
financial instruments and
June 2010 1,303.4 411.1 269.4 68.7
exceptional items
Capital
expenditure
September 2010 (2,219.5) (1,316.8) (343.9) (335.9)
June 2010 (2,146.6) (1,235.7) (333.9) (315.6)
South Africa Region
Beatrix South Deep
Operating Results
Ore milled/treated
(000 tonnes)
September 2010 937 495
June 2010 717 463
Yield (grams per tonne)
September 2010 3.4 4.4
June 2010 4.0 4.7
Gold produced (kilograms)
September 2010 3,202 2,198
June 2010 2,856 2,176
Gold sold (kilograms)
September 2010 3,202 2,198
June 2010 2,856 2,176
Gold price received (Rand per kilogram)
September 2010 287,633 287,989
June 2010 289,391 290,257
Total cash cost
(Rand per kilogram)
September 2010 191,599 223,294
June 2010 189,216 201,333
Notional cash
expenditure
(Rand per kilogram)
September 2010 241,037 451,137
June 2010 260,049 388,925
Operating costs
(Rand per tonne)
September 2010 669 1,008
June 2010 774 967
Financial Results
(Rand million)
Revenue
September 2010 921.0 633.0
June 2010 826.5 631.6
Operating costs,
net
September 2010 (627.2) (499.2)
June 2010 (555.2) (447.6)
- Operating costs
September 2010 (627.2) (499.2)
June 2010 (555.2) (447.6)
- Gold inventory
change
September 2010 - -
June 2010 - -
Operating profit
September 2010 293.8 133.8
June 2010 271.3 184.0
Amortisation of
mining assets
September 2010 (141.3) (130.8)
June 2010 (136.8) (124.5)
Net operating
profit
September 2010 152.5 3.0
June 2010 134.5 59.5
Other expenses
September 2010 (16.2) (54.9)
June 2010 (9.7) (55.6)
Profit/(loss)
before taxation
September 2010 136.3 (51.9)
June 2010 124.8 3.9
Mining and income
taxation
September 2010 (72.2) 19.0
June 2010 (50.9) (5.0)
- Normal
taxation
September 2010 (1.0) -
June 2010 (1.1) -
- Royalties
September 2010 (4.6) (3.2)
June 2010 (4.1) (3.1)
- Deferred
taxation
September 2010 (66.6) 22.2
June 2010 (45.7) (1.9)
Profit/(loss)
before exceptional items
September 2010 64.1 (32.9)
June 2010 73.9 (1.1)
Exceptional items
September 2010 (23.0) (0.5)
June 2010 (2.5) (3.1)
Net profit/(loss)
September 2010 41.1 (33.4)
June 2010 71.4 (4.2)
September 2010 55.4 (33.1)
Net profit/(loss)excluding gains
and losses on foreign exchange,
financial instruments and
June 2010 75.3 (2.3)
exceptional items
Capital expenditure
September 2010 (144.6) (492.4)
June 2010 (187.5) (398.7)
Operating and financial results
SOUTH AFRICAN RAND
South
West Africa Region America
Region
Peru
Ghana Cerro
Total Tarkwa Damang Corona
Operating Results
Ore milled/treated
(000 tonnes)
September 2010 6,987 5,750 1,237 1,607
June 2010 7,517 6,192 1,325 1,485
Yield (grams per tonne)
September 2010 1.1 1.0 1.4 2.0
June 2010 1.1 1.0 1.3 2.0
Gold produced
(kilograms)
September 2010 7,527 5,769 1,758 3,291
June 2010 7,993 6,226 1,767 3,001
Gold sold (kilograms)
September 2010 7,527 5,769 1,758 3,538
June 2010 7,993 6,226 1,767 2,806
Gold price received
(Rand per kilogram)
September 2010 289,783 289,461 290,842 296,269
June 2010 288,953 288,853 289,304 266,358
Total cash cost
(Rand per kilogram)
September 2010 145,769 142,156 157,622 83,691
June 2010 150,307 144,748 169,892 89,202
Notional cash
expenditure
(Rand per kilogram)
September 2010 209,061 209,378 208,020 107,900
June 2010 192,068 186,219 212,677 121,326
Operating costs
(Rand per tonne)
September 2010 147 132 217 170
June 2010 152 137 218 172
Financial Results
(Rand million)
Revenue
September 2010 2,181.2 1,669.9 511.3 1,048.2
June 2010 2,309.6 1,798.4 511.2 747.4
Operating costs, net
September 2010 (1,051.2) (791.4) (259.8) (289.9)
June 2010 (1,139.5) (853.7) (285.8)
(242.0)
- Operating costs
September 2010 (1,028.7) (759.8) (268.9) (273.1)
June 2010 (1,140.1) (850.9) (289.2) (256.1)
- Gold inventory
change
September 2010 (22.5) (31.6) 9.1 (16.8)
June 2010 0.6 (2.8) 3.4 14.1
Operating profit
September 2010 1,130.0 878.5 251.5 758.3
June 2010 1,170.1 944.7 225.4
505.4
Amortisation of
mining assets
September 2010 (254.4) (220.2) (34.2) (110.2)
June 2010 (292.7) (252.0) (40.7) (109.2)
Net operating profit
September 2010 875.6 658.3 217.3 648.1
June 2010 877.4 692.7 184.7 396.2
Other expenses
September 2010 (24.1) (18.2) (5.9) (63.5)
June 2010 (34.9) (27.9) (7.0) (36.4)
Profit before
taxation
September 2010 851.5 640.1 211.4 584.6
June 2010 842.5 664.8 177.7 359.8
Mining and income
taxation
September 2010 (327.8) (248.4) (79.4) (206.5)
June 2010 (330.1) (258.7) (71.4) (156.2)
- Normal taxation
September 2010 (213.1) (172.8) (40.3) (166.5)
June 2010 (189.9) (132.9) (57.0) (64.3)
- Royalties
September 2010 (109.1) (83.5) (25.6) (28.4)
June 2010 (115.9) (90.1) (25.8) (20.9)
- Deferred
taxation
September 2010 (5.6) 7.9 (13.5) (11.6)
June 2010 (24.3) (35.7) 11.4 (71.0)
Profit before
exceptional items
September 2010 523.7 391.7 132.0 378.1
June 2010 512.4 406.1 106.3 203.6
Exceptional items
September 2010 (1.5) (1.5) - -
June 2010 - - - (0.1)
Net profit
September 2010 522.2 390.2 132.0 378.1
June 2010 512.4 406.1 106.3 203.5
September 2010 525.2 393.2 132.0 378.1
Net profit excluding
gains and losses on
foreign exchange, financial
instruments and
June 2010 513.6 407.3 106.3 194.6
exceptional items
Capital expenditure
September 2010 (544.9) (448.1) (96.8) (82.0)
June 2010 (395.1) (308.5) (86.6) (108.0)
Australasia Region #
Australia
Total St Ives Agnew
Operating Results
Ore milled/treated
(000 tonnes)
September 2010 1,857 1,648 209
June 2010 1,930 1,746 184
Yield (grams per tonne)
September 2010 2.6 2.2 5.3
June 2010 2.4 2.1 5.4
Gold produced
(kilograms)
September 2010 4,766 3,668 1,098
June 2010 4,640 3,654 986
Gold sold (kilograms)
September 2010 4,766 3,668 1,098
June 2010 4,640 3,654 986
Gold price received
(Rand per kilogram)
September 2010 287,998 287,759 288,798
June 2010 290,991 291,927 287,525
Total cash cost
(Rand per kilogram)
September 2010 155,728 157,579 149,545
June 2010 169,655 167,022 179,412
Notional cash
expenditure
(Rand per kilogram)
September 2010 224,990 224,782 225,683
June 2010 260,690 236,754 349,391
Operating costs
(Rand per tonne)
September 2010 429 377 836
June 2010 415 363 916
Financial Results
(Rand million)
Revenue
September 2010 1,372.6 1,055.5 317.1
June 2010 1,350.2 1,066.7 283.5
Operating costs, net
September 2010 (715.8) (551.6) (164.2)
June 2010 (778.7) (596.5) (182.2)
- Operating costs
September 2010 (796.5) (621.7) (174.8)
June 2010 (801.8) (633.2) (168.6)
- Gold inventory
change
September 2010 80.7 70.1 10.6
June 2010 23.1 36.7 (13.6)
Operating profit
September 2010 656.8 503.9 152.9
June 2010 571.5 470.2 101.3
Amortisation of
mining assets
September 2010 (326.7)
June 2010 (265.7)
Net operating profit
September 2010 330.1
June 2010 305.8
Other expenses
September 2010 (20.3)
June 2010 (9.2)
Profit before
taxation
September 2010 309.8
June 2010 296.6
Mining and income
taxation
September 2010 (115.5)
June 2010 (115.7)
- Normal taxation
September 2010 -
June 2010 (4.4)
- Royalties
September 2010 (33.7)
June 2010 (35.6)
- Deferred
taxation
September 2010 (81.8)
June 2010 (75.7)
Profit before
exceptional items
September 2010 194.3
June 2010 180.9
Exceptional items
September 2010 (8.6)
June 2010 -
Net profit
September 2010 185.7
June 2010 180.9
September 2010 195.3
Net profit excluding
gains and losses on
foreign exchange,
financial
instruments and
June 2010 184.1
exceptional items
Capital expenditure
September 2010 (275.8) (202.8) (73.0)
June 2010 (407.8) (231.9) (175.9)
# As a significant portion of the acquisition price was allocated to
tenements of St Ives and Agnew based on endowment ounces and also as these
two 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.
Operating and financial results
UNITED STATES DOLLARS South Africa Region
Total
Mine
Operations Total
Driefontein
Operating Results
Ore milled/treated
(000 tonnes)
September 2010 14,510 4,059 1,521
June 2010 14,863 3,931 1,594
Yield (ounces per
tonne)
September 2010 0.069 0.122 0.127
June 2010 0.067 0.124 0.117
Gold produced
(000 ounces)
September 2010 998.0 497.0 193.5
June 2010 990.8 488.2 185.9
Gold sold (000 ounces)
September 2010 1,006.0 497.0 193.5
June 2010 984.6 488.2 185.9
Gold price received
(dollars per ounce)
September 2010 1,223 1,217 1,218
June 2010 1,191 1,199 1,199
Total cash cost
(dollars per ounce)
September 2010 697 827 726
June 2010 688 778 727
Notional cash
expenditure
(dollars per ounce)
September 2010 1,006 1,201 971
June 2010 974 1,129 969
Operating costs
(dollars per tonne)
September 2010 48 103 93
June 2010 46 98 85
Financial Results
($ million)
Revenue
September 2010 1,230.0 604.7 235.6
June 2010 1,169.2 583.9 222.3
Operating costs, net
September 2010 (697.3) (417.8) (141.0)
June 2010 (673.1) (386.1) (135.4)
- Operating costs
September 2010 (702.9) (417.8) (141.0)
June 2010 (678.1) (386.1) (135.4)
- Gold inventory
change
September 2010 5.6 - -
June 2010 5.0 - -
Operating profit
September 2010 532.7 186.9 94.5
June 2010 496.1 197.8 86.9
Amortisation of
mining assets
September 2010 (191.1) (97.2) (29.9)
June 2010 (176.3) (87.7) (25.2)
Net operating profit
September 2010 341.6 89.7 64.6
June 2010 320.0 110.1 61.7
Other expenses
September 2010 (33.2) (18.5) (3.2)
June 2010 (29.1) (18.5) (3.7)
Profit/(loss) before
taxation
September 2010 308.4 71.2 61.4
June 2010 290.8 91.6 58.0
Mining and income
taxation
September 2010 (109.0) (20.8) (17.3)
June 2010 (115.1) (36.7) (22.2)
- Normal taxation
September 2010 (55.9) (4.3) (6.0)
June 2010 (46.0) (11.7) (11.1)
- Royalties
September 2010 (29.6) (6.3) (4.5)
June 2010 (28.8) (6.4) (4.6)
- Deferred taxation
September 2010 (23.6) (10.1) (6.9)
June 2010 (40.3) (18.6) (6.5)
Profit/(loss) before
exceptional items
September 2010 199.4 50.4 44.1
June 2010 175.6 54.9 35.8
Exceptional items
September 2010 (16.5) (15.1) (4.9)
June 2010 (1.2) (1.2) (0.1)
Net profit/(loss)
September 2010 182.9 35.3 39.2
June 2010 174.4 53.7 35.7
Net profit/(loss)
excluding gains and losses on
foreign exchange,
financial instruments and
exceptional items
September 2010 194.0 44.7 42.2
June 2010 170.6 54.5 35.8
Capital expenditure
September 2010 (301.6) (178.9) (46.7)
June 2010 (285.2) (164.2) (44.3)
South Africa Region
Kloof Beatrix South Deep
Operating Results
Ore milled/treated
(000 tonnes)
September 2010 1,106 937 495
June 2010 1,157 717 463
Yield (ounces per
tonne)
September 2010 0.117 0.110 0.143
June 2010 0.121 0.128 0.151
Gold produced
(000 ounces)
September 2010 129.9 102.9 70.7
June 2010 140.5 91.8 70.0
Gold sold (000 ounces)
September 2010 129.9 102.9 70.7
June 2010 140.5 91.8 70.0
Gold price received
(dollars per ounce)
September 2010 1,216 1,216 1,217
June 2010 1,197 1,199 1,202
Total cash cost
(dollars per ounce)
September 2010 927 810 944
June 2010 813 784 834
Notional cash
expenditure
(dollars per ounce)
September 2010 1,304 1,019 1,907
June 2010 1,136 1,077 1,611
Operating costs
(dollars per tonne)
September 2010 112 91 137
June 2010 102 103 129
Financial Results
($ million)
Revenue
September 2010 158.0 125.1 86.0
June 2010 167.8 109.9 83.9
Operating costs, net
September 2010 (123.7) (85.2) (67.8)
June 2010 (117.4) (73.8) (59.5)
- Operating costs
September 2010 (123.7) (85.2) (67.8)
June 2010 (117.4) (73.8) (59.5)
- Gold inventory
change
September 2010 - - -
June 2010 - - -
Operating profit
September 2010 34.3 39.9 18.2
June 2010 50.4 36.1 24.4
Amortisation of
mining assets
September 2010 (30.3) (19.2) (17.8)
June 2010 (27.8) (18.2) (16.5)
Net operating profit
September 2010 4.0 20.7 0.4
June 2010 22.6 17.9 7.9
Other expenses
September 2010 (5.7) (2.2) (7.5)
June 2010 (6.1) (1.3) (7.4)
Profit/(loss) before
taxation
September 2010 (1.7) 18.5 (7.1)
June 2010 16.5 16.6 0.5
Mining and income
taxation
September 2010 3.8 (9.8) 2.6
June 2010 (7.1) (6.8) (0.6)
- Normal taxation
September 2010 1.8 (0.1) -
June 2010 (0.4) (0.2) -
- Royalties
September 2010 (0.8) (0.6) (0.4)
June 2010 (0.9) (0.5) (0.4)
- Deferred taxation
September 2010 2.8 (9.0) 3.0
June 2010 (5.8) (6.1) (0.2)
Profit/(loss) before
exceptional items
September 2010 2.1 8.7 (4.5)
June 2010 9.4 9.8 (0.1)
Exceptional items
September 2010 (7.0) (3.1) (0.1)
June 2010 (0.3) (0.3) (0.4)
Net profit/(loss)
September 2010 (4.9) 5.6 (4.5)
June 2010 9.1 9.5 (0.5)
Net profit/(loss)
excluding gains and losses on
foreign exchange,
financial instruments and
exceptional items
September 2010 (0.6) 7.5 (4.5)
June 2010 9.1 10.0 (0.4)
Capital expenditure
September 2010 (45.6) (19.6) (66.9)
June 2010 (42.0) (24.9) (53.0)
Average exchange rates were US$1 = R7.36 and US$1 = R7.51 for the September
and June 2010 quarters respectively.
The Australian dollar exchange rates were A$1 = R6.59 and A$1 = R6.66 for the
September 2010 and June 2010 quarters respectively.
Operating and financial results
UNITED STATES DOLLARS
South
West Africa Region America
Region
Peru
Ghana
Cerro
Total Tarkwa Damang Corona
Operating Results
Ore milled/treated
(000 tonnes)
September 2010 6,987 5,750 1,237 1,607
June 2010 7,517 6,192 1,325 1,485
Yield (ounces per
tonne)
September 2010 0.035 0.032 0.046 0.066
June 2010 0.034 0.032 0.043 0.065
Gold produced (000
ounces)
September 2010 242.0 185.5 56.5 105.8
June 2010 257.0 200.2 56.8 96.5
Gold sold (000 ounces)
September 2010 242.0 185.5 56.5 113.7
June 2010 257.0 200.2 56.8 90.2
Gold price received
(dollars per ounce)
September 2010 1,225 1,223 1,229 1,252
June 2010 1,197 1,196 1,198 1,103
Total cash cost
(dollars per ounce)
September 2010 616 601 666 354
June 2010 623 599 704 369
Notional cash
expenditure
(dollars per ounce)
September 2010 883 885 879 456
June 2010 795 771 881 502
Operating costs
(dollars per tonne)
September 2010 20 18 30 23
June 2010 20 18 29 23
Financial Results
($ million)
Revenue
September 2010 296.4 226.9 69.5 142.4
June 2010 306.6 238.7 67.9 99.4
Operating costs, net
September 2010 (142.8) (107.5) (35.3) (39.4)
June 2010 (151.3) (113.3) (38.0) (32.2)
- Operating costs
September 2010 (139.8) (103.2) (36.5) (37.1)
June 2010 (151.4) (113.0) (38.4) (34.1)
- Gold inventory
change
September 2010 (3.1) (4.3) 1.2 (2.3)
June 2010 0.1 (0.3) 0.4 1.9
Operating profit
September 2010 153.5 119.4 34.2 103.0
June 2010 155.3 125.4 29.9 67.2
Amortisation of
mining
assets
September 2010 (34.6) (29.9) (4.6) (15.0)
June 2010 (38.9) (33.5) (5.4) (14.5)
Net operating profit
September 2010 119.0 89.4 29.5 88.1
June 2010 116.4 91.9 24.5 52.7
Other expenses
September 2010 (3.3) (2.5) (0.8) (8.6)
June 2010 (4.6) (3.7) (0.9) (4.9)
Profit before
taxation
September 2010 115.7 87.0 28.7 79.4
June 2010 111.9 88.2 23.7 47.8
Mining and income
taxation
September 2010 (44.5) (33.8) (10.8) (28.1)
June 2010 (43.9) (34.3) (9.6) (20.7)
- Normal taxation
September 2010 (29.0) (23.5) (5.5) (22.6)
June 2010 (25.2) (17.6) (7.6) (8.6)
- Royalties
September 2010 (14.8) (11.3) (3.5) (3.9)
June 2010 (15.5) (12.0) (3.5) (2.7)
- Deferred
taxation
September 2010 (0.8) 1.1 (1.8) (1.6)
June 2010 (3.2) (4.7) 1.5 (9.4)
Profit before
exceptional items
September 2010 71.2 53.2 17.9 51.4
June 2010 67.9 53.9 14.0 27.1
Exceptional items
September 2010 (0.2) (0.2) - -
June 2010 - - - -
Net profit
September 2010 71.0 53.0 17.9 51.4
June 2010 67.9 53.9 14.0 27.1
Net profit
excluding gains
and losses on
foreign
exchange, financial
instruments and
exceptional items
September 2010 71.4 53.4 17.9 51.4
June 2010 68.2 54.1 14.1 25.9
Capital expenditure
September 2010 (74.0) (60.9) (13.2) (11.1)
June 2010 (52.5) (41.0) (11.5) (14.4)
Australasia Region
Australia #
Total St Ives Agnew
Operating Results
Ore milled/treated
(000 tonnes)
September 2010 1,857 1,648 209
June 2010 1,930 1,746 184
Yield (ounces per
tonne)
September 2010 0.083 0.072 0.169
June 2010 0.077 0.067 0.172
Gold produced (000
ounces)
September 2010 153.2 117.9 35.3
June 2010 149.2 117.5 31.7
Gold sold (000 ounces)
September 2010 153.2 117.9 35.3
June 2010 149.2 117.5 31.7
Gold price received
(dollars per ounce)
September 2010 1,217 1,216 1,220
June 2010 1,205 1,209 1,191
Total cash cost
(dollars per ounce)
September 2010 658 666 632
June 2010 703 692 743
Notional cash
expenditure
(dollars per ounce)
September 2010 951 950 954
June 2010 1,080 981 1,447
Operating costs
(dollars per tonne)
September 2010 58 51 114
June 2010 55 48 122
Financial Results
($ million)
Revenue
September 2010 186.5 143.4 43.1
June 2010 179.3 141.6 37.7
Operating costs, net
September 2010 (97.3) (74.9) (22.3)
June 2010 (103.4) (79.2) (24.2)
- Operating costs
September 2010 (108.2) (84.5) (23.8)
June 2010 (106.5) (84.1) (22.4)
- Gold inventory
change
September 2010 11.0 9.5 1.4
June 2010 3.1 4.9 (1.8)
Operating profit
September 2010 89.2 68.5 20.8
June 2010 75.9 62.4 13.5
Amortisation of
mining
assets
September 2010 (44.4)
June 2010 (35.3)
Net operating profit
September 2010 44.9
June 2010 40.6
Other expenses
September 2010 (2.8)
June 2010 (1.1)
Profit before
taxation
September 2010 42.1
June 2010 39.6
Mining and income
taxation
September 2010 (15.7)
June 2010 (13.9)
- Normal taxation
September 2010 -
June 2010 (0.6)
- Royalties
September 2010 (4.6)
June 2010 (4.2)
- Deferred
taxation
September 2010 (11.1)
June 2010 (9.1)
Profit before
exceptional items
September 2010 26.4
June 2010 25.6
Exceptional items
September 2010 (1.2)
June 2010 -
Net profit
September 2010 25.2
June 2010 25.6
Net profit
excluding gains
and losses on
foreign
exchange, financial
instruments and
exceptional items
September 2010 26.5
June 2010 22.0
Capital expenditure
September 2010 (37.5) (27.6) (9.9)
June 2010 (54.1) (30.8) (23.3)
AUSTRALIAN DOLLARS
Australasia Region #
Total St Ives Agnew
Operating Results
Ore milled/treated
(000 tonnes)
September 2010 1,857 1,648 209
June 2010 1,930 1,746 184
Yield (ounces per
tonne)
September 2010 0.083 0.072 0.169
June 2010 0.077 0.067 0.172
Gold produced (000
ounces)
September 2010 153.2 117.9 35.3
June 2010 149.2 117.5 31.7
Gold sold (000 ounces)
September 2010 153.2 117.9 35.3
June 2010 149.2 117.5 31.7
Gold price received
(dollars per ounce)
September 2010 1,359 1,358 1,363
June 2010 1,359 1,363 1,343
Total cash cost
(dollars per ounce)
September 2010 735 744 706
June 2010 792 780 838
Notional cash
expenditure
(dollars per ounce)
September 2010 1,062 1,061 1,065
June 2010 1,217 1,106 1,632
Operating costs
(dollars per tonne)
September 2010 65 57 127
June 2010 62 54 138
Financial Results
($ million)
Revenue
September 2010 208.3 160.2 48.1
June 2010 202.1 159.7 42.5
Operating costs, net
September 2010 (108.6) (83.7) (24.9)
June 2010 (116.6) (89.3) (27.3)
- Operating costs
September 2010 (120.9) (94.3) (26.5)
June 2010 (120.1) (94.8) (25.3)
- Gold inventory
change
September 2010 12.2 10.6 1.6
June 2010 3.5 5.5 (2.0)
Operating profit
September 2010 99.7 76.5 23.2
June 2010 85.5 70.4 15.2
Amortisation of
mining
assets
September 2010 (49.6)
June 2010 (39.8)
Net operating profit
September 2010 50.1
June 2010 45.7
Other expenses
September 2010 (3.1)
June 2010 (1.4)
Profit before
taxation
September 2010 47.0
June 2010 44.3
Mining and income
taxation
September 2010 (17.5)
June 2010 (17.3)
- Normal taxation
September 2010 -
June 2010 (0.7)
- Royalties
September 2010 (5.1)
June 2010 (5.3)
- Deferred
taxation
September 2010 (12.4)
June 2010 (11.3)
Profit before
exceptional items
September 2010 29.5
June 2010 27.0
Exceptional items
September 2010 (1.3)
June 2010 -
Net profit
September 2010 28.2
June 2010 27.0
Net profit
excluding gains
and losses on
foreign
exchange, financial
instruments and
exceptional items
September 2010 29.6
June 2010 28.3
Capital expenditure
September 2010 (41.9) (30.8) (11.1)
June 2010 (61.0) (34.7) (26.3)
# As a significant portion of the acquisition price was allocated to
tenements of St Ives and Agnew on endowment ounces and also as these two
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.
Figures may not add as they are rounded independently.
Total cash cost
Gold Industry Standards Basis
Figures are in South African rand millions unless otherwise stated
South Africa Region
Total
Mine
Operations Total Driefontein Kloof
Operating costs (1)
Sept 2010 (5,173.4) (3,075.1) (1,038.0) (910.7)
June 2010 (5,102.5) (2,904.5) (1,018.8) (882.9)
Gold-in-process and
inventory change*
Sept 2010 25.3 - - -
June 2010 19.6 - - -
Less:
Rehabilitation costs
Sept 2010 (28.6) (23.4) (9.3) (7.4)
June 2010 (30.4) (22.2) (8.9) (6.9)
Production taxes
Sept 2010 (8.4) (8.4) (2.0) (3.5)
June 2010 4.5 4.5 (0.9) 7.8
General and admin
Sept 2010 (177.6) (74.1) (27.9) (23.0)
June 2010 (183.2) (79.5) (28.8) (25.6)
Cash operating costs
Sept 2010 (4,933.5) (2,969.2) (998.8) (876.8)
June 2010 (4,873.8) (2,807.3) (980.2) (858.2)
Plus:
Production taxes
Sept 2010 (8.4) (8.4) (2.0) (3.5)
June 2010 4.5 4.5 (0.9) 7.8
Royalties
Sept 2010 (217.6) (46.4) (32.8) (5.8)
June 2010 (220.7) (48.3) (34.3) (6.8)
TOTAL CASH COST (2)
Sept 2010 (5,159.5) (3,024.0) (1,033.6) (886.1)
June 2010 (5,090.0) (2,851.1) (1,015.4) (857.2)
Plus:
Amortisation*
Sept 2010 (1,390.7) (715.5) (220.3) (223.1)
June 2010 (1,310.2) (660.8) (190.0) (209.5)
Rehabilitation
Sept 2010 (28.6) (23.4) (9.3) (7.4)
June 2010 (30.4) (22.2) (8.9) (6.9)
TOTAL PRODUCTION
COST (3)
Sept 2010 (6,578.8) (3,762.9) (1,263.2) (1,116.6)
June 2010 (6,430.6) (3,534.1) (1,214.3) (1,073.6)
Gold sold
- thousand ounces
Sept 2010 1,006.0 497.0 193.5 129.9
June 2010 984.6 488.2 185.9 140.5
TOTAL CASH COST
- US$/oz
Sept 2010 697 827 726 927
June 2010 688 778 727 813
TOTAL CASH COST
- R/kg
Sept 2010 164,898 195,627 171,780 219,277
June 2010 166,215 187,770 175,584 196,201
TOTAL PRODUCTION
COST - US$/oz
Sept 2010 889 1,029 887 1,168
June 2010 870 964 870 1,018
TOTAL PRODUCTION
COST - R/kg
Sept 2010 210,259 243,427 209,939 276,318
June 2010 213,163 244,231 221,096 257,954
West Africa Region
South Ghana
Beatrix Deep Total Tarkwa Damang
Operating costs (1)
Sept 2010 (627.2) (499.2) (1,028.7) (759.8) (268.9)
June 2010 (555.2) (447.6) (1,140.1) (850.9) (289.2)
Gold-in-process and
inventory change*
Sept 2010 - - (22.1) (30.1) 8.0
June 2010 - - (6.5) (9.8) 3.3
Less:
Rehabilitation
costs
Sept 2010 (4.4) (2.3) (1.3) (1.1) (0.2)
June 2010 (4.0) (2.4) (2.3) (1.8) (0.5)
Production taxes
Sept 2010 (1.3) (1.6) - - -
June 2010 (1.0) (1.4) - - -
General and admin
Sept 2010 (13.9) (9.3) (61.4) (52.2) (9.2)
June 2010 (14.9) (10.2) (58.8) (47.8) (11.0)
Cash operating
costs
Sept 2010 (607.6) (486.0) (988.1) (736.6) (251.5)
June 2010 (535.3) (433.6) (1,085.5) (811.1) (274.4)
Plus:
Production taxes
Sept 2010 (1.3) (1.6) - - -
June 2010 (1.0) (1.4) - - -
Royalties
Sept 2010 (4.6) (3.2) (109.1) (83.5) (25.6)
June 2010 (4.1) (3.1) (115.9) (90.1) (25.8)
TOTAL CASH COST (2)
Sept 2010 (613.5) (490.8) (1,097.2) (820.1) (277.1)
June 2010 (540.4) (438.1) (1,201.4) (901.2) (300.2)
Plus:
Amortisation*
Sept 2010 (141.3) (130.8) (254.8) (221.7) (33.1)
June 2010 (136.8) (124.5) (285.6) (245.0) (40.6)
Rehabilitation
Sept 2010 (4.4) (2.3) (1.3) (1.1) (0.2)
June 2010 (4.0) (2.4) (2.3) (1.8) (0.5)
TOTAL PRODUCTION
COST (3)
Sept 2010 (759.2) (623.9) (1,353.3) (1,042.9) (310.4)
June 2010 (681.2) (565.0) (1,489.3) (1,148.0) (341.3)
Gold sold
- thousand ounces
Sept 2010 102.9 70.7 242.0 185.5 56.5
June 2010 91.8 70.0 257.0 200.2 56.8
TOTAL CASH COST
- US$/oz
Sept 2010 810 944 616 601 666
June 2010 784 834 623 599 704
TOTAL CASH COST
- R/kg
Sept 2010 191,599 223,294 145,769 142,156 157,622
June 2010 189,216 201,333 150,307 144,748 169,892
TOTAL PRODUCTION
COST - US$/oz
Sept 2010 1,002 1,200 760 764 746
June 2010 988 1,075 772 764 800
TOTAL PRODUCTION
COST - R/kg
Sept 2010 237,102 283,849 179,793 180,777 176,564
June 2010 250,420 270,037 178,469 177,594 181,551
South Australasia Region
America
Region
Peru Australia
Cerro
Corona Total St Ives Agnew
Operating costs (1)
Sept 2010 (273.1) (796.5) (621.7) (174.8)
June 2010 (256.1) (801.8) (633.2) (168.6)
Gold-in-process and
inventory change*
Sept 2010 (11.9) 59.3 51.4 7.9
June 2010 9.2 16.9 26.9 (10.0)
Less:
Rehabilitation costs
Sept 2010 (9.0) (3.0) (2.5) (0.5)
June 2010 (3.0) (2.9) (2.3) (0.6)
Production taxes
Sept 2010 - - - -
June 2010 - - - -
General and admin
Sept 2010 (16.4) (25.7) (15.5) (10.2)
June 2010 (14.5) (30.4) (21.5) (8.9)
Cash operating costs
Sept 2010 (267.7) (708.5) (552.3) (156.2)
June 2010 (229.4) (751.6) (582.5) (169.1)
Plus:
Production taxes
Sept 2010 - - - -
June 2010 - - - -
Royalties
Sept 2010 (28.4) (33.7) (25.7) (8.0)
June 2010 (20.9) (35.6) (27.8) (7.8)
TOTAL CASH COST (2)
Sept 2010 (296.1) (742.2) (578.0) (164.2)
June 2010 (250.3) (787.2) (610.3) (176.9)
Plus:
Amortisation*
Sept 2010 (115.1) (305.3)
June 2010 (104.3) (259.5)
Rehabilitation
Sept 2010 (0.9) (3.0)
June 2010 (3.0) (2.9)
TOTAL PRODUCTION
COST (3)
Sept 2010 (412.1) (1,050.5)
June 2010 (357.6) (1,049.6)
Gold sold
- thousand ounces
Sept 2010 113.7 153.2 117.9 35.3
June 2010 90.2 149.2 117.5 31.7
TOTAL CASH COST
- US$/oz
Sept 2010 354 658 666 632
June 2010 369 703 692 743
TOTAL CASH COST
- R/kg
Sept 2010 83,691 155,728 157,579 149,545
June 2010 89,202 169,655 167,022 179,412
TOTAL PRODUCTION
COST - US$/oz
Sept 2010 492 931
June 2010 528 937
TOTAL PRODUCTION
COST - R/kg
Sept 2010 116,478 220,415
June 2010 124,982 224,591
DEFINITIONS
Total cash cost and Total production cost are calculated in accordance with
the Gold Institute Industry standard.
(1) Operating costs - All gold mining related costs before
amortisation/depreciation, changes in gold inventory, taxation and
exceptional items.
(2) Total cash cost - Operating costs less off-mine costs, which include
general and administration costs, as detailed in the table above.
(3) Total production cost - Total cash cost plus amortisation/depreciation
and rehabilitation provisions, as detailed in the table above.
* Adjusted for amortisation/depreciation (non-cash item) excluded from gold-
in-process change.
Average exchange rates were US$1 = R7.36 and US$1 = R7.51 for the September
2010 and the June 2010 quarters respectively.
Capital expenditure
Figures are in South African rand millions unless otherwise stated
South Africa Region
Total
Mine
Operations Total Driefontein Kloof
Beatrix
Sustaining
capital
September 2010 (1,602.5) (796.1) (315.6) (335.9) (144.6)
June 2010 (1,609.7) (799.3) (296.2) (315.6) (187.5)
Project
capital
September 2010 (492.4) (492.4) - - -
June 2010 (398.7) (398.7) - - -
Uranium
capital
September 2010 (28.3) (28.3) (28.3) - -
June 2010 (37.7) (37.7) (37.7) - -
Brownfields
exploration
September 2010 (96.3) - - - -
June 2010 (100.5) - - - -
Total capital
expenditure
September 2010 (2,219.5) (1,316.8) (343.9) (335.9) (144.6)
June 2010 (2,146.6) (1,235.7) (333.9) (315.6) (187.5)
West Africa Region
South Ghana
Deep Total Tarkwa Damang
Sustaining capital
September 2010 - (519.7) (448.1) (71.6)
June 2010 - (369.3) (308.5) (60.8)
Project capital
September 2010 (492.4) - - -
June 2010 (398.7) - - -
Uranium capital
September 2010 - - - -
June 2010 - - - -
Brownfields
exploration
September 2010 - (25.2) - (25.2)
June 2010 - (25.8) - (25.8)
Total capital
expenditure
September 2010 (492.4) (544.9) (448.1) (96.8)
June 2010 (398.7) (395.1) (308.5) (86.6)
South Australasia Region
America
Region Australia
Peru
Cerro St
Corona Total Ives Agnew
Sustaining capital
September 2010 (82.0) (204.7) (148.6) (56.1)
June 2010 (108.0) (333.1) (184.2) (148.9)
Project capital
September 2010 - - - -
June 2010 - - - -
Uranium capital
September 2010 - - - -
June 2010 - - - -
Brownfields
exploration
September 2010 - (71.1) (54.2) (16.9)
June 2010 - (74.7) (47.7) (27.0)
Total capital
expenditure
September 2010 (82.0) (275.8) (202.8) (73.0)
June 2010 (108.0) (407.8) (231.9) (175.9)
Notional cash expenditure##
Figures are in South African rand millions unless otherwise stated
South Africa Region
Total Total Driefontein Kloof Beatrix
Operating costs
September 2010 (5,173.4) (3,075.1) (1,038.0) (910.7) (627.2)
June 2010 (5,102.5) (2,904.5) (1,018.8) (882.9) (555.2)
Capital
expenditure
September 2010 (2,225.4) (1,316.8) (343.9) (335.9) (144.6)
June 2010 (2,156.9) (1,235.7) (333.9) (315.6) (187.5)
Notional cash
expenditure
- R/kg
September 2010 238,348 284,118 229,666 308,488 241,037
June 2010 235,223 272,669 233,910 274,319 260,049
Notional cash
expenditure
- US$/oz
September 2010 1,007 1,201 971 1,304 1,019
June 2010 974 1,129 969 1,136 1,077
West Africa Region
South Ghana
Deep Total Tarkwa Damang
Operating costs
September 2010 (499.2) (1,028.7) (759.8) (268.9)
June 2010 (447.6) (1,140.1) (850.9) (289.2)
Capital
September 2010 (492.4) (544.9) (448.1) (96.8)
expenditure
June 2010 (398.7) (395.1) (308.5) (86.6)
Notional cash
expenditure
- R/kg
September 2010 451,137 209,061 209,378 208,020
June 2010 388,925 192,068 186,219 212,677
Notional cash
expenditure
- US$/oz
September 2010 1,907 883 885 879
June 2010 1,611 795 771 881
South Australasia Region
America
Region
Peru Australia
Cerro St
Corona Total Ives Agnew Corporate
Operating costs
September 2010 (273.1) (796.5) (621.7) (174.8) -
June 2010 (256.1) (801.8) (633.2) (168.6) -
Capital
September 2010 (82.0) (275.8) (202.8) (73.0) (5.9)
expenditure
June 2010 (108.0) (407.8) (231.9) (175.9) (10.3)
Notional cash
expenditure
- R/kg
September 2010 107,900 224,990 224,782 225,683 -
June 2010 121,326 260,690 236,754 349,391 -
Notional cash
expenditure
- US$/oz
September 2010 456 951 950 954 -
June 2010 502 1,080 981 1,447 -
## Notional cash expenditure (NCE) per kilogram (ounce) = operating costs
plus capital expenditure divided by gold produced.
Underground and surface
South African rand and metric units
South Africa Region
Total
Mine
Operating Results Operations Total Driefontein Kloof Beatrix
Ore milled/treated
(000 tonne)
- underground
September 2010 3,086 2,531 793 577 686
June 2010 3,144 2,580 841 599 697
- surface
September 2010 11,424 1,528 728 529 251
June 2010 11,719 1,351 753 558 20
- total
September 2010 14,510 4,059 1,521 1,106 937
June 2010 14,863 3,931 1,594 1,157 717
Yield (grams
per tonne)
- underground
September 2010 5.6 5.7 6.8 6.4 4.5
June 2010 5.4 5.4 6.1 6.5 4.1
- surface
September 2010 1.2 0.7 0.9 0.6 0.5
June 2010 1.2 0.9 0.9 0.9 0.9
- combined
September 2010 2.1 3.8 4.0 3.7 3.4
June 2010 2.1 3.9 3.6 3.8 4.0
Gold produced
(kilograms)
- underground
September 2010 17,359 14,335 5,357 3,714 3,076
June 2010 16,929 14,034 5,142 3,887 2,838
- surface
September 2010 13,683 1,123 660 327 126
June 2010 13,889 1,150 641 482 18
- total
September 2010 31,042 15,458 6,017 4,041 3,202
June 2010 30,818 15,184 5,783 4,369 2,856
Operating costs
(Rand per tonne)
- underground
September 2010 1,091 1,160 1,202 1,512 892
June 2010 1,046 1,083 1,129 1,408 796
- surface
September 2010 158 91 116 72 62
June 2010 155 82 92 70 10
- total
September 2010 357 758 682 823 669
June 2010 343 739 639 763 774
West Africa Region
South Ghana
Operating Results Deep# Total Tarkwa Damang
Ore milled/treated
(000 tonne)
- underground
September 2010 475 - - -
June 2010 443 - - -
- surface
September 2010 20 6,987 5,750 1,237
June 2010 20 7,517 6,192 1,325
- total
September 2010 495 6,987 5,750 1,237
June 2010 463 7,517 6,192 1,325
Yield (grams
per tonne)
- underground
September 2010 5.9 - - -
June 2010 6.3 - - -
- surface
September 2010 0.5 1.1 1.0 1.4
June 2010 0.5 1.1 1.0 1.3
- combined
September 2010 4.4 1.1 1.0 1.4
June 2010 4.7 1.1 1.0 1.3
Gold produced
(kilograms)
- underground
September 2010 2,188 - - -
June 2010 2,167 - - -
- surface
September 2010 10 7,527 5,769 1,758
June 2010 9 7,993 6,226 1,767
- total
September 2010 2,198 7,527 5,769 1,758
June 2010 2,176 7,993 6,226 1,767
Operating costs
(Rand per tonne)
- underground
September 2010 1,050 - - -
June 2010 1,008 - - -
- surface
September 2010 30 147 132 217
June 2010 60 152 137 218
- total
September 2010 1,008 147 132 217
June 2010 967 152 137 218
South Australasia Region
America
Region
Peru
Cerro Australia
Operating Results Corona Total St Ives Agnew
Ore milled/treated
(000 tonne)
- underground
September 2010 - 555 410 145
June 2010 - 564 405 159
- surface
September 2010 1,607 1,302 1,238 64
June 2010 1,485 1,366 1,341 25
- total
September 2010 1,607 1,857 1,648 209
June 2010 1,485 1,930 1,746 184
Yield (grams
per tonne)
- underground
September 2010 - 5.4 4.7 7.4
June 2010 - 5.1 4.8 6.0
- surface
September 2010 2.0 1.3 1.4 0.3
June 2010 2.0 1.3 1.3 1.5
- combined
September 2010 2.0 2.6 2.2 5.3
June 2010 2.0 2.4 2.1 5.4
Gold produced
(kilograms)
- underground
September 2010 - 3,024 1,945 1,079
June 2010 - 2,895 1,946 949
- surface
September 2010 3,291 1,742 1,723 19
June 2010 3,001 1,745 1,708 37
- total
September 2010 3,291 4,766 3,668 1,098
June 2010 3,001 4,640 3,654 986
Operating costs
(Rand per tonne)
- underground
September 2010 - 778 639 1,172
June 2010 - 874 814 1,030
- surface
September 2010 170 280 291 77
June 2010 172 226 226 196
- total
September 2010 170 429 377 836
June 2010 172 415 363 916
# September quarter includes 105,000 tonnes (June quarter 98,000 tonnes) of
waste processed from underground. In order to show the yield based on ore
mined, the calculation of the yield at South Deep only, excludes the
underground waste.
Development results
Development values represent the actual results of sampling and no allowance
has been made for any adjustments which may be necessary when estimating ore
reserves. All figures below exclude shaft sinking metres.
Driefontein September 2010 quarter
Reef Carbon Leader Main VCR
Advanced (m) 5,213 417 1,501
Advanced on reef (m) 797 35 151
Sampled (m) 663 81 69
Channel width (cm) 59 33 89
Average value - (g/t) 34.7 19.4 18.3
- (cm.g/t) 2,048 641 1,631
June 2010 quarter
Reef Carbon Leader Main VCR
Advanced (m) 4,418 648 1,349
Advanced on reef (m) 608 172 173
Sampled (m) 558 114 108
Channel width (cm) 100 42 79
Average value - (g/t) 18.9 8.8 17.4
- (cm.g/t) 1,884 372 1,369
Kloof September 2010 quarter
Reef Kloof Main VCR
Advanced (m) 123 627 4,074
Advanced on reef (m) 2 243 752
Sampled (m) 3 296 705
Channel width (cm) 195 79 109
Average value - (g/t) 11.2 12.0 26.1
- (cm.g/t) 2,184 943 2,853
June 2010 quarter
Reef Kloof Main VCR
Advanced (m) 241 1,022 4,600
Advanced on reef (m) 13 231 848
Sampled (m) 22 243 711
Channel width (cm) 145 69 99
Average value - (g/t) 7.7 13.9 29.2
- (cm.g/t) 1,118 953 2,904
Beatrix September 2010 quarter
Reef Beatrix Kalkoenkrans
Advanced (m) 4,779 1,707
Advanced on reef (m) 1,554 296
Sampled (m) 1,593 285
Channel width (cm) 111 92
Average value - (g/t) 7.9 15.3
- (cm.g/t) 881 1,409
June 2010 quarter
Reef Beatrix Kalkoenkrans
Advanced (m) 5,839 2,151
Advanced on reef (m) 1,153 384
Sampled (m) 1,062 366
Channel width (cm) 98 96
Average value - (g/t) 7.7 17.2
- (cm.g/t) 748 1,643
South Deep September 2010 quarter June 2010 quarter
Reef Elsburgs 1,2 Elsburgs 1,2
Main Advanced (m) 2,982 2,449
- Main above 95 level (m) 1,774 1,369
- Main below 95 level (m) 1,208 1,080
Advanced on reef (m) 1,664 1,280
Average value (g/t) 5.6 4.4
1) Trackless development in the Elsburg reefs is evaluated by means of the
resource model.
2) Full channel width not fully exposed in development, hence not reported.
Administration and corporate information
Corporate Secretary
Cain Farrel
Tel: (+27)(11) 562 9742
Fax: (+27)(11) 562 9829
e-mail: cain.farrel@goldfields.co.za
Registered Offices
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
6 St James`s Place
London SW1A 1NP
United Kingdom
Tel: (+44)(20) 7499 3916
Fax: (+44)(20) 7491 1989
American Depository Receipts Transfer
Agent
Bank of New York Mellon
BNY Mellon Shareowner Services
PO Box 358516
Pittsburgh, PA15252-8516
US toll-free telephone: (1)(888) 269 2377
Tel: (+1) 201 680 6825
e-mail: shrrelations@bnymellon.com
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
Willie Jacobsz
Tel: (+508) 839 1188
Mobile: (+857) 241 7127
e-mail: willie.jacobsz@gfexpl.com
Nikki Catrakilis-Wagner
Tel: (+2711) 562 9706
Mobile: (+27) 83 309 6720
e-mail: nikki.catrakilis-wagner@goldfields.co.za
Media Enquiries
Sven Lunsche
Tel: (+2711) 562 9763
Mobile: (+27) 83 260 9279
e-mail: sven.lunsche@goldfields.co.za
Transfer Secretaries
South Africa
Computershare Investor Services
(Proprietary) Limited
Ground Floor
70 Marshall Street
Johannesburg, 2001
PO Box 61051
Marshalltown, 2107
Tel: (+27)(11) 370 5000
Fax: (+27)(11) 688 5248
United Kingdom
Capita Registrars
The Registry
34 Beckenham Road
Beckenham
Kent BR3 4TU
England
Tel: 0871 664 0300 (calls cost 10p a minute
plus network extras, lines are open
8.30am-5.30pm Mon-Fri) or
(from overseas) +44 20 8639 3399
Fax: +44 20 8658 3430
e-mail: ssd@capitaregistrars.com
Website
http://www.goldfields.co.za
Listings
JSE / NYSE / NASDAQ Dubai: GFI
NYX: GFLB
SWX: GOLI
Certain forward looking statements
Certain statements in this document constitute "forward looking statements"
within the meaning of Section 27A of the US Securities Act of 1933 and
Section 21E of the US Securities Exchange Act of 1934.
Such forward looking statements involve known and unknown risks,
uncertainties and other important factors that could cause the actual
results, performance or achievements of the company to be materially
different from the future results, performance or achievements expressed or
implied by such forward looking statements. Such risks, uncertainties and
other important factors include among others: economic, business and
political conditions in South Africa, Ghana, Australia, Peru and elsewhere;
the ability to achieve anticipated efficiencies and other cost savings in
connection with past and future acquisitions, exploration and development
activities; decreases in the market price of gold and/or copper; hazards
associated with underground and surface gold mining; labour disruptions;
availability terms and deployment of capital or credit; changes in government
regulations, particularly environmental regulations; and new legislation
affecting mining and mineral rights; changes in exchange rates; currency
devaluations; inflation and other macro- economic factors, industrial action,
temporary stoppages of mines for safety and unplanned maintenance reasons;
and the impact of the AIDS crisis in South Africa. These forward looking
statements speak only as of the date of this document.
The company 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 document or to reflect the occurrence of
unanticipated events.
Directors
M A Ramphele (Chair) K Ansah #
N J Holland *- (Chief Executive Officer) CA Carolus
PA Schmidt - (Chief Financial Officer) R Danino **
A R Hill D M J Ncube
R P Menell R L Pennant-Rea *
D N Murray C I von Christierson
G M Wilson
* British # Ghanaian Canadian
** Peruvian Independent Director - Non-independent Director
www.goldfields.co.za
Sponsor:
J.P. Morgan Equities Limited
Date: 04/11/2010 08:00:03 Produced by the JSE SENS Department.
The SENS service is an information dissemination service administered by the
JSE Limited (`JSE`). The JSE does not, whether expressly, tacitly or
implicitly, represent, warrant or in any way guarantee the truth, accuracy or
completeness of the information published on SENS. The JSE, their officers,
employees and agents accept no liability for (or in respect of) any direct,
indirect, incidental or consequential loss or damage of any kind or nature,
howsoever arising, from the use of SENS or the use of, or reliance on,
information disseminated through SENS.
