Attributable gold production up 4 per cent and total cash costs maintained at below R65,000 per kilogram
28 April 2005
JOHANNESBURG. 28 April 2005 – Gold Fields Limited (NYSE & JSE: GFI) today announced March 2005 quarter net earnings excluding gains and losses on financial instruments and foreign debt and exceptional items of R128 million up 28 per cent, compared with R100 million in the December 2004 quarter. In US dollar terms the March 2005 quarter equivalent was US$21 million compared with US$16 million in the December 2004 quarter.
March 2005 quarter salient features:
Attributable gold production increased 4 per cent to 1.09 million ounces quarter on quarter, in line with the previous guidance. The increase at the international operations was 17 per cent;
Costs were again well controlled, with total cash costs flat at R64,957 per kilogram (US$340 per ounce);
Operating profit of R537 million (US$90 million) was achieved for the March quarter;
Normalised earnings up 28 per cent to R128 million;
Gold Fields continued its vigorous defence against Harmony’s hostile and ill conceived take-over attempt.
Ian Cockerill,
Chief Executive Officer of Gold Fields said:
“This is a challenging time for the South African gold mining industry and I am delighted with the way all of our employees have responded magnificently to the twin challenges of the difficult operating environment and the continuing saga of the hostile Harmony offer. I am pleased to report that the Gold Fields team around the world has once again delivered in line with its promises, with a strong operational performance across the Group.
A creditable 4 per cent increase in total attributable gold production was mostly offset by the lower rand gold price received during the quarter, resulting in a marginal increase in revenue. Rand per kilogram costs were well contained with Group costs flat at R64,957 per kilogram and net earnings, excluding gains and losses on financial instruments and foreign debt and exceptional items, increasing by 28 per cent quarter on quarter.
The Group’s ongoing focus on inward investment has paid dividends, as international production has increased by 17 per cent with the completion of the growth projects at St Ives and Tarkwa. Further benefits are expected at these operations as internal efficiencies are maximised and costs reduced.
The South African operations delivered a robust performance despite the Christmas break and the traditional slow start up. Planning and scheduling was optimised at these operations in order to minimize production disruptions during this period. This optimised planning lead to gold production at the South African operations for the quarter ended March 2005 being 2 per cent higher than the corresponding period in the previous year. For the group as a whole, attributable gold produced was over 5 per cent higher than the corresponding period in the prior year with unit costs 4 per cent lower. The benefits of Project 100 and Project Beyond continue to be realized as South African unit operating costs again decreased quarter on quarter, the third in a row. Gold Fields is firmly on track to meet its stated rand cost per kilogram target of R70,000 for the South African operations and this target was in fact exceeded in the March month.
The results announced today are another clear demonstration of the true value of Gold Fields and management’s ability to deliver in difficult times. We will continue to focus on operational excellence, which we believe will result in another strong performance in the next quarter despite continuing tough economic conditions.”
