Gold Fields reports 'solid set of results'

World number-four gold miner Gold Fields on Tuesday reported March quarter net earnings per share after exceptional items of 76 cents compared with 56 cents in the December 2005 quarter.

March quarter net earnings were R483-million compared with R262-million in the December 2005 quarter and a loss of R2-million for the March quarter of 2005.

Net earnings excluding gains and losses on financial instruments and foreign debt net of cash and exceptional items were R376-million for the March 2006 quarter compared with R275-million for the December 2005 quarter.

Headline earnings were R446-million compared with R261-million in the December 2005 quarter.

Revenue was R109 500 per kilogram from R101 184 per kilogram in the previous quarter, while total cash costs were R73 378 per kilogram from R71 659 per kilogram in the December 2005 quarter.

“Gold Fields produced another solid set of results, with overall production and total cash costs impacted only marginally by the extended Christmas break at the South African operations. All operations maintained good cost control with the bottom-line projects delivering results,” Gold Fields CEO Ian Cockerill said.

“As forecast, the declines at the South African operations (mainly at Kloof) were largely offset by a healthy improvement at the international operations,” he added.

Production at Gold Fields’ South African operations was 646 000 oz—down 7% from 698 000 oz in the December 2005 quarter—while attributable gold output increased 10% to 377 000 oz from 342 000 oz in the December 2005 quarter.

“At the South African operations, Driefontein’s gold production was marginally below that achieved in the December quarter, with lower underground production due to the Christmas/New Year break. This was largely offset by an increase in surface tonnage as forecast,” Gold Fields said.

Driefontein’s output for the quarter was 285 500 oz from 290 100 oz in the December 2005 quarter.

“Beatrix performed similar to last quarter.
At Kloof, gold production decreased significantly due to a shortage of stockpile material available over the Christmas break and a slow start-up thereafter as a result of a labour dispute,” the company added.

Kloof had gold output of 207 100 oz from 252 600 oz in the December 2005 quarter, while Beatrix reported gold production of 154 900 oz, unchanged from the previous quarter.

In Ghana, the Tarkwa mine generated gold output of 192 400 oz from 166 600 oz in the December 2005 quarter and Damang reported gold production of 62 000 oz from 60 200 oz.

The Choco 10 mine, which Gold Fields acquired with effect from March 1, contributed gold output of 5 400 oz.

In Australia, the St Ives mine generated gold output of 134 300 oz in the March quarter from 125 900 oz in the December 2005 quarter and Agnew reported gold production of 55 900 oz from 55 100 oz in the previous three-month period.

At Cerro Corona in Peru, the permit to construct, as well as the last of several permits required for the construction phase, was received from the Peruvian ministry of energy and mines during the quarter, Gold Fields said.

Construction is expected to begin early in the June quarter, the company added.

Turning to the outlook, Gold Fields said gold production for the June quarter should be similar to that of the March quarter, with the forecast increase at Kloof offsetting shortfalls at some of the other mines and cash costs should also be similar in the June quarter to the March quarter.—I-Net Bridge

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