Gold Fields sees fall in profit

The New Age (Free State) - - BUSINESS -

GOLD Fields said yes­ter­day its full-year profit fell 4%, with pro­duc­tion from its last South African as­set South Deep fall­ing be­low guid­ance.

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

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

Gold Fields un­veiled a new plan last year to make its mech­a­nised South Deep mine, which has pre­sented op­er­a­tional chal­lenges in an un­for­giv­ing ge­ol­ogy 3km be­neath the sur­face, prof­itable with a pro­duc­tion tar­get of 500000 ounces in 2022.

The com­pany said it had in­curred a R3.5bn good­will im­pair­ment due to the slow start of the re­base plan over the year at South Deep and a re­duc­tion in the gold price and re­source price as­sump­tions used in the life of the mine model.

Pro­duc­tion at South Deep mine for the year was 11% be­low orig­i­nal guid­ance at 281 000oz, com­pared with 290 000oz in the pre­vi­ous year.

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

Gold Fields, which also op­er­ates in Ghana and Peru, de­clared a fi­nal div­i­dend of 50c a share, tak­ing the to­tal div­i­dend for the year to 90c com­pared with R1.10 in the pre­vi­ous pe­riod. – Reuters

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