Gold Fields Limited
Incorporated in the Republic of South Africa
Registration number 1968/004880/06
Share code: GFI
Issuer code: GOGOF
ISIN: ZAE 000018123
NEWS RELEASE Q3 F2004 RESULTS
Quarter Ended 31 March 2004
-Unaudited-
STOCK DATA
Number of shares in issue
- at 31 March 2004 491,320,299
- average for the quarter 491,254,653
Free Float 100%
ADR Ratio 1:1
Bloomberg / Reuters GFISJ / GFLJ.J
JSE SECURITIES EXCHANGE SOUTH AFRICA � (GFI)
Range - Quarter ZAR77.41 � ZAR102.60
Average Volume - Quarter 1,338,000 shares / day
NYSE � (GFI)
Range - Quarter US$11.50 � US$14.91
Average Volume - Quarter 1,447,900 shares / day
INVESTOR RELATIONS
Europe & South Africa
Willie Jacobsz Nerina Bodasing
Tel : +27 11 644-2460 Tel : +27 11 644-2630
Fax: +27 11 484-0639 Fax : +27 11 484-0639
E-mail: investors@goldfields.co.za
North America
Cheryl A. Martin
Tel: 303 796-8683
Fax: 303 796-8293
E-mail: camartin@gfexpl.com
www.goldfields.co.za www.gold-fields.com
GOLD FIELDS DELIVERS STRONG PERFORMANCE
WITH 20 PER CENT JUMP IN OPERATING PROFIT
JOHANNESBURG. 6 May 2004 � Gold Fields Limited (NYSE & JSE: GFI) today
announced March 2004 quarter net earnings of R255 million (51 cents per share)
compared with net earnings of R277 million (57 cents per share) in the December
2003 quarter and R805 million (171 cents per share) for the March quarter of
2003. In US dollar terms the March 2004 quarter net earnings were US$38 million
(US$0.07 per share) compared with US$42 million (US$0.09 per share) in the
December 2003 quarter and US$93 million (US$0.20 per share) for the March
quarter of 2003. Attributable gold production for the March 2004 quarter was
1.033 million ounces compared with 1.045 million ounces in the December 2003
quarter.
March 2004 quarter highlights included:
* Operating profit up 20 per cent to R656 million (US$96 million);
* Recovery in operating margin from 19 per cent to 22 per cent, (South African
operations from 7 per cent to 14 per cent);
* Attributable gold production virtually unchanged at 1.033 million ounces,
despite extended Christmas break;
* Total cash costs were flat quarter on quarter at R67,528 per kilogram and
US$309 per ounce;
* International growth strategy progressing well with major growth projects in
Ghana, Australia, Peru and Finland on track;
* International operations are debt free; and
* Successful conclusion of the Mvelaphanda transaction leaves Gold Fields in a
strong financial position which will enable growth projects to be funded
internally.
Ian Cockerill, Chief Executive Officer of Gold Fields said:
"Despite the tough operating environment during the March 2004 quarter, Gold
Fields has produced satisfactory results. The ongoing repositioning of our
South African operations, to improve grades and reduce costs, has contributed
to significant margin expansion. I fully expect this trend to continue."
"These results reflect our focus on delivering value to shareholders. We
continue to implement our strategy to build a high quality, internationally
diverse, gold company that is optimally managed for sustainable earnings
growth."
"In addition, during the quarter, MMC Norilsk acquired a 20 per cent interest
in Gold Fields from Anglo American plc. After preliminary discussions with
Norilsk it has been agreed to explore the potential for co-operation with
regards to our respective gold assets."
Salient features
SA Rand
Nine months to
March March
2003 2004
kg Gold produced* 102,433 96,910
R/kg Total cash costs 61,263 67,360
000 Tons milled 32,063 34,952
R/kg Revenue 100,302 86,630
R/ton Operating costs 216 202
Rm Operating profit 4,023 1,770
Rm 2,164 953
Net earnings
SA c.p.s. 459 197
Rm 1,899 634
Headline earnings
SA c.p.s. 403 131
Net earnings
excluding
Rm 1,785 485
gains and losses on
financial
instruments
SA c.p.s. 378 100
foreign debt net of
cash and
exceptional item
Quarter
March Dec March
2003 2003 2004
kg Gold produced* 33,340 32,480 32,131
R/kg Total cash costs 60,709 66,991 67,528
000 Tons milled 10,792 11,640 11,815
R/kg Revenue 95,068 84,842 88,887
R/ton Operating costs 201 202 199
Rm Operating profit 1,126 545 656
Rm 805 277 255
Net earnings
SA c.p.s. 171 57 51
Rm 644 249 221
Headline earnings
SA c.p.s. 136 51 45
Net earnings
excluding
Rm 476 111 238
gains and losses
on financial
instruments and
SA c.p.s. 101 23 48
foreign debt net
of cash and
exceptional items
US Dollars
Quarter
March Dec March
2004 2003 2003
Gold produced* oz (000) 1,033 1,045 1,072
Total cash costs $/oz 309 308 225
Tons milled 000 11,815 11,640 10,792
Revenue $/oz 407 390 353
Operating costs $/ton 29 30 24
Operating profit $m 96 80 135
$m 38 42 93
Net earnings
US c.p.s. 7 9 20
$m 33 36 75
Headline earnings
US c.p.s. 7 7 16
Net earnings excluding
$m 34 17 58
gains and losses on
financial instruments and
US c.p.s. 7 3 12
foreign debt net of cash
and exceptional items
Nine months to
March March
2004 2003
Gold produced* oz (000) 3,116 3,293
Total cash costs $/oz 299 200
Tons milled 000 34,952 32,063
Revenue $/oz 395 328
Operating costs $/ton 29 23
Operating profit $m 253 423
$m 136 228
Net earnings
US c.p.s. 28 48
$m 91 200
Headline earnings
US c.p.s. 19 42
Net earnings excluding
$m 69 188
gains and losses on
financial instruments and
US c.p.s. 14 40
foreign debt net of cash
and exceptional items
*Attributable � All companies wholly owned except for Ghana (71.1%).
Overview
As anticipated, largely due to the Christmas break at the South African
operations, the Group's attributable gold production for the March quarter at
1.03 million ounces was 1 per cent below that of the December quarter. Total
cash costs in the March quarter were virtually unchanged at R67,528 per
kilogram despite lower production and the impact of translating Australia's
costs at a stronger Australian dollar. Total cash costs in US$ terms at $309
per ounce also tracked the previous quarter, with the rand/dollar exchange rate
being stable at R6.79 compared with R6.76 in the previous quarter.
Net earnings excluding gains and losses on financial instruments and foreign
debt net of cash and exceptional items were slightly more than double the
previous quarter due to the 20 per cent increase in operating profit.
Net earnings were 8 per cent below the December 2003 quarter, at R255 million
(US$38 million). This was due to a reduction in gains from financial
instruments and an increase in finance costs associated with an unrealised
exchange loss on Euro's held offshore. The aggregated effect of these two items
more than offset the 20 per cent increase in operating profit achieved for the
quarter due to the increased gold price and reduced costs.
Health and safety
During the quarter the lost day injury frequency rate at the operations
improved from 15.4 to 13.8, the serious injury frequency rate improved from 7.9
to 6.5 and the fatal injury frequency rate improved from 0.37 to 0.15. This is
an excellent achievement. Beatrix achieved a million fatality free shifts
during the quarter with Beatrix 4 shaft achieving one year without a fatality
on 23 January 2004.
This achievement is a first for a senior operations manager in the Group. In
addition, Damang mine in Ghana recorded one year without any lost day injuries,
also on 23 January.
Financial Review
Quarter ended 31 March 2004 compared
with quarter ended 31 December 2003
REVENUE
Revenue was 4 per cent higher than the previous quarter at R3,028 million
(US$444 million). It compared with R2,923 million (US$431 million) in the
December quarter. This was due to a higher rand gold price as a consequence of
a 4 per cent increase in the average US dollar gold price from US$390 per ounce
to US$407 per ounce in the March quarter. The average Rand/US dollar exchange
rate remained virtually unchanged at 6.79. The resultant rand gold price of
R88,887 per kilogram was 5 per cent higher than the R84,842 per kilogram
achieved last quarter. The higher gold price was partly offset by the lower
gold sales of 34,069 kilograms (1,095,300 ounces) compared with 34,451
kilograms (1,107,600 ounces) last quarter.
OPERATING COSTS
Operating costs at R2,351 million (US$345 million) for the quarter were
marginally lower than the previous quarter's costs of R2,355 million (US$347
million). At the South African operations, costs decreased 3 per cent compared
with the previous quarter. This was in line with the slightly lower production
levels at Kloof and Beatrix as a result of the Christmas break. At Driefontein,
costs decreased 2 per cent despite the 6 per cent increase in production. Last
quarter's costs included opening up of additional areas as a result of the
underground fires. The lower costs at the South African operations also reflect
the positive impact of cost reduction strategies. However, these lower costs
were offset by the increase in costs at the international operations. This
increase was mainly due to translating costs at the Australian operations at a
stronger Australian dollar. Ghana's costs increased this quarter in line with
the higher volumes mined, associated with accelerated stripping to provide
greater flexibility.
OPERATING PROFIT MARGIN
The net effect of the higher revenue and lower costs, was an increase in
operating profit from R545 million (US$80 million) in the December quarter to
R656 million (US$96 million) this quarter.
The operating margin for the Group increased to 22 per cent for the current
quarter from 19 per cent in the previous quarter. This was due to an increase
in margins at the South African operations from 7 per cent in the previous
quarter to 14 per cent in the March quarter. The increase at the South African
operations resulted from the higher gold price and lower costs despite the fact
that production was only 90 kilograms lower than the previous quarter. The
margin at the international operations decreased from 38 per cent last quarter
to 34 per cent this quarter. The reduction was due to lower production at St
Ives associated with a mill shutdown and less material toll treated.
AMORTISATION
Amortisation was slightly lower than the previous quarter at R298 million
(US$44 million), in line with the decreased production.
ACCOUNTING FOR THE MVELA TRANSACTION
The net proceeds of R4,107 million (R4,139 million less R32 million of costs)
from the Mvela loan was accounted for as two components. The first is the debt
component of the Mvela loan of R1,653 million, which is the present value of
the future interest payments determined at a fixed half yearly rate of 10.56
per cent.
The debt component is shown under long-term and current portion of long-term
loans in the balance sheet. The balance of R2,454 million was accounted for as
the equity component of the Mvela loan. The equity component is shown under
shareholders' equity in the balance sheet.
Due to the difference between the accounting and taxation treatment of the
Mvela loan a deferred taxation asset of R677 million was recognised with the
corresponding credit included with the equity component of the Mvela loan. The
deferred taxation asset will be charged to earnings as the loan is repaid.
FINANCIAL INSTRUMENTS AND DEBT
Exchange losses on foreign debt and cash amounted to R34 million (US$5 million)
compared with a gain of R60 million (US$8 million) last quarter. Included in
this loss is an amount of R31 million (US$4 million) due to an unrealised
exchange loss on Euro funds held offshore. The Euro's resulted from an offshore
share placement conducted late last year, which realised US$217 million net of
costs. These funds were redenominated into Euro's. The loss has resulted from
the weakening of the Euro against the US dollar from 1.25 to 1.23 over the
quarter. In the December quarter the gain on these Euro's amounted to R65
million (US$9 million) as the Euro strengthened against the US dollar from
1.20, being the value at the date of the original conversion from US dollar
into Euro's, to the December closing rate of 1.25 to the US dollar. The balance
of the loss on foreign debt and cash was a small exchange loss on the repayment
of the Australian debt outstanding at the end of December of US$11 million.
This loss amounted to R3 million (US$1 million), which was similar to last
quarter.
The gain on the financial instruments for the quarter amounted to R44 million
(US$7 million) compared with R120 million (US$17 million) earned last quarter.
Included in this quarter are gains on the Australian financial instruments of
R98 million (US$15 million), offset by losses on the Tarkwa forward purchases
of R25 million and a marked to market loss of R29 million (US$4 million) as a
result of an interest rate swap executed in relation to the Mvela loan, all
explained in more detail below.
As previously reported, the Australian operations established currency
financial instruments to protect their underlying cash flows against a possible
strengthening of the Australian dollar against the United States dollar. Gains
on these financial instruments amounted to R98 million (US$15 million) in the
current quarter as detailed below, compared with R143 million (US$20 million)
in the previous quarter. The gain in the previous quarter was a result of the
Australian dollar strengthening against the US dollar, from 68.14 cents at the
end of the September 2003 quarter to 73.41 cents at the end of the December
quarter 2003. The closing rate at the end of the March quarter was 75.15 US
cents to the Australian dollar.
On 7 January 2004, Gold Fields Australia closed out the Australian dollar/US
dollar currency financial instruments. The existing forward purchases of
Australian dollars and the put and call options were closed out by entering
into equal and opposite transactions to the same maturity dates of the original
translation. The close out of the outstanding open position of US$275 million
was at an average spot rate of 0.7670 US$/AU$. These transactions locked in
gross profit amounting to US$116 million and the underlying cash receipts were
deferred to match the maturity dates of the original transactions. The present
value of this gross profit amounted to US$112 million. An amount of US$103
million had already been accounted for in the marked to market valuation up
until the end of December 2003. During the quarter the scheduled closure of
US$12.5 million of the overall position, thus reducing it to US$275 million,
resulted in a profit of US$5 million and this, together with the
crystallisation of the profit above, resulted in a net gain of US$14 million
(R98 million).
In order that the Group is able to participate in further Australian dollar
appreciation a strip of quarterly maturing Australian dollar/US dollar call
options were purchased in respect of an amount of US$275 million of which the
value dates and amounts match those of the remaining period of the original
structure.
The Australian dollar call options resulted in a premium of US$8.3 million
based on a strike price of 0.7670 US$/AU$. The payments were also deferred to
match the maturity dates of the original structure. The options are valued on a
marked to market basis.
The gain on the above financial instruments was partially offset by an
unrealised loss of R25 million (US$4 million) on the rand/US dollar forward
cover of US$50 million. These forward purchases are to hedge the Group's
commitment in respect of the Tarkwa mill and owner mining projects approved at
US$159 million, to the extent that these projects are funded from South African
sources.
In the December quarter the unrealised loss amounted to R23 million (US$3
million). The weighted average forward rate in respect of the forward cover is
R8.43 to the US dollar and maturity is on 3 June 2004. The marked to market
value of this forward purchase at the end of the quarter was a negative R89
million (US$14 million negative).
The balance of negative R29 million (US$4 million) is the marked to market loss
as a result of an interest rate swap in respect of the Mvela loan. The interest
rate exposure on the Mvela loan was converted from a fixed rate of 10.56 per
cent nominal annual compound semi-annually to a floating rate, being the three
month Jibar rate, by concluding an interest rate swap over the life of the
loan.
Full details of this and other financial instruments are given on page 11 of
this report.
EXPLORATION AND OTHER
Exploration expenditure increased, from R35 million (US$5 million) in the
December quarter to R44 million (US$7 million) in the March quarter, largely as
a result of planned increased activity. The increase in other income of R22
million (US$3 million) relates mainly to shares received in offshore
exploration companies in exchange for joint venture exploration interests, the
market value of which has been included in income.
EXCEPTIONAL ITEMS
Profit before taxation and exceptional items decreased 7 per cent to R345
million (US$51 million) compared with R370 million (US$54 million) posted in
the December 2003 quarter. This was mainly due to the net loss on foreign debt
and cash as well as reduced gains on financial instruments, described earlier,
which more than offset the increase in operating profit. Exceptional items
amounted to R21 million (US$3 million) and includes the sale of the remaining
shares of 1,003,000 in Harmony Gold Mining Company Limited and the remaining
485,000 shares held in Committee Bay Resources Limited, resulting in a profit
of R47 million (US$7 million). This was partly offset by the write off of
mineral rights amounting to R25 million (US$4 million). This write off arises
from the introduction of the Mineral and Petroleum Resources and Development
Act, 2002 (Act No. 28 of 2002), which was declared effective on 1 May 2004.
TAXATION
Taxation at R64 million (US$9 million) compared with R84 million (US$12
million) for the previous quarter. This was mainly due to reduced gains on the
financial instruments.
EARNINGS
As a result of the above, net earnings, after accounting for minority
interests, were R255 million (US$38 million) or 51 SA cents per share (US$0.07
per share), compared with R277 million (US$42 million) or 57 SA cents per share
(US$0.09 per share) in the previous quarter.
Headline earnings i.e. net earnings less the net after tax effect of asset
sales and the sale of investments, amounted to R221 million (US$32 million) or
45 SA cents per share (US$0.07) compared with R249 million (US$36 million) or
51 SA cents per share (US$0.07) last quarter. The main reason for this decrease
was the exchange loss on foreign debt and cash together with the lower gains on
financial instruments.
Earnings, excluding exceptional items as well as the net gains on financial
instruments and foreign debt net of cash after taxation, amounted to R238
million (US$34 million) or 48 SA cents per share (US$0.07 per share) as
compared with R110 million (US$17 million) or 23 SA cents per share (US$0.03
per share) achieved last quarter. This improvement reflects the 20 per cent
increase in operating profit.
CASH FLOW
Operating cash flow for the quarter was R528 million (US$77 million), compared
with operating cash flow in the December quarter of R677 million (US$96
million). The decrease is mainly due to an increase in taxation paid of R68
million (US$9 million).
An interim dividend of R197 million (US$29 million) was paid during the
quarter. No dividend was paid in the previous quarter.
Capital expenditure was R749 million (US$109 million) as compared with R662
million (US$97 million) in the December 2003 quarter. The increase is mainly
due to increased expenditure on growth projects in Ghana and Australia. R153
million (US$28 million) was expended at the South African operations. This is a
decrease of R99 million (US$11 million) when compared with the previous quarter
due to the deferral/cut back of non-essential capital expenditure without
negatively impacting on key capital projects. The Australian operations
incurred capital expenditure of R269 million (A$57 million), the majority on
development of existing projects and exploration to increase the ore reserve
base at those operations. The mill project at St Ives commenced this quarter
and accounted for R91 million (A$19 million) of this expenditure. At the
Ghanaian operations, capital expenditure amounted to R282 million (US$46
million), the majority at Tarkwa on the mill and owner mining projects, which
amounted to R263 million (US$43 million) as compared with R153 million (US$23
million) the previous quarter. Expenditure to date on these projects amounts to
R475 million (US$73 million), leaving a balance of US$86 million to completion.
Major projects are still forecast to be in line with approved votes except for
a possible small over expenditure on the mill project at Tarkwa, which will
depend on currency moves over the next few months. During the quarter the
proceeds from the sale of Driefontein's 1C11 block amounting to R315 million
(US$45 million) was received.
Cash flows from financing activities include the proceeds from the Mvela
transaction of R3.8 billion (US$543 million). This receipt is net of the Mvela
shares subscribed for of R100 million (US$15 million) and the redeemable
preference shares of R200 million (US$29 million) and transaction costs of R32
million (US$ 5 million). Outstanding foreign debt of US$14 million (R100
million) was repaid during the quarter and the offshore operations are now debt
free.
Net cash inflow for the quarter including the above was R3,684 million (US$527
million). The cash balance at the end of the March 2004 quarter was R4,701
million (US$721 million) as compared with R1,104 million (US$161 million) at
the end of the December 2003 quarter.
Quarter ended 3 1 March 2004 compared with quarter ended 31 Ma rch 20 03
Attributable gold production decreased by 4 per cent to 1,033,000 ounces in the
March 2004 quarter compared with 1,072,000 ounces in the March 2003 quarter.
The decrease in production was due to lower underground and surface yields at
the South African operations. This was partly offset by the excellent results
achieved at the international operations, where attributable production year on
year is up 10 per cent from 308,000 ounces to 338,000 ounces.
Revenue decreased 10 per cent in rand terms (increased 12 per cent in US dollar
terms) from R3,352 million (US$397 million) to R3,028 million (US$444 million).
This was due to a reduction in the rand gold price achieved from R95,068 per
kilogram (US$353 per ounce) in the March 2003 quarter to R88,887 per kilogram
(US$407 per ounce) in the March 2004 quarter and the lower production. Group
operating costs in rand terms increased by 8 per cent or R179 million (US$89
million). At the South African operations operating costs increased by 6 per
cent or R89 million (US$60 million) slightly lower than the wage increases. The
increase at the international operations amounted to 15 per cent, from R617
million (US$74 million) to R707 million (US$104 million).
This increase results from the increased levels of production in Australia and
the increase in waste mined to improve mining flexibility at Tarkwa. Added to
this is the effect of translating costs at the Australian operations at a 5 per
cent weaker Rand, which weakened from an average of 4.95 to 5.19 Rand to the
Australian dollar in comparative periods. This was offset partially by
translating costs at Ghana into South African rand at a 19 per cent stronger
Rand/US dollar exchange rate than the corresponding quarter in the previous
year. The average exchange rate strengthened from R8.38 to the US dollar in the
March 2003 quarter to R6.79 in the current quarter.
Operating profit at R656 million (US$96 million) for the March 2004 quarter
compares to R1,126 million (US$135 million) for the March 2003 quarter as a
result of the above.
Profit before tax amounted to R365 million (US$54 million) compared with R1,214
million (US$141 million) in the March 2003 quarter. The decrease in the profit
was due to the lower operating profit described above as well as the following
items. The gain on financial instruments reduced from R185 million (US$19
million) to R44 million (US$7 million); net interest and investment income was
negative R4 million (US$1 million) in the current quarter compared with a
positive R41 million (US$5 million) in the March 2003 quarter; exchange gains
and losses reduced from a R55 million (US$6 million) gain to a loss of R34
million (US$5 million) in the current quarter and exceptional items reduced
from R177 million (US$19 million) to R21 million (US$3 million) this
quarter,due to lower profit on the sale of shares, offset partially by the
lower amortisation of R298 million (US$44 million) in line with the lower
production.
Earnings decreased from R805 million (US$93 million) in the March 2003 quarter
to R255 million (US$38 million) in the March 2004 quarter.
Nine months ended 31 March 2004 compared with nine months ended 31 March 2003
Attributable gold production decreased 5 per cent from 3,293,000 ounces to
3,116,000 as a result of lower grades at the South African operations and the
sale of St Helena. St Helena accounted for 43,700 of these ounces. Gold output
from Kloof and Driefontein decreased by 100,000 ounces each. This was partly
offset by the increased production of 9 per cent from the international
operations.
Revenue decreased by 18 per cent in rand terms (increased 11 per cent in US
dollar terms) from R10,922 million (US$1,149 million) to R8,904 million
(US$1,272 million) due to the decrease in production and the decrease in the
gold price from R100,302 per kilogram (US$328 per ounce) to R86,630 per
kilogram (US$385 per ounce) for the nine months ended 31 March 2004.
Operating costs increased 2 per cent compared with the prior year period at
R7,047 million (US$1,007 million). However, due to the lower production, the
unit cost increased 11 per cent to R67,528 per kilogram as compared with
R60,709 per kilogram in the prior period. The increase at the South African
operations of 9 per cent was offset by the lower costs at the International
operations, as a result of translating the Ghanaian operations at a 26 per cent
stronger rand, which strengthened from an average of R9.51 to R7.00 to the US
dollar over this period. The stronger rand when compared with the Australian
dollar had a similar effect when translating the Australian operations, though
smaller at 7 per cent, strengthening from an average of 5.36 to 4.97 rand to
the Australian dollar.
Operating profit at R1,770 million (US$253 million) compared with R4,023
million (US$423 million) achieved in the nine months to March 2003. Profit
before tax amounted to R1,257 million (US$180 million) compared with R3,476
million (US$366 million) for the same period last year due to the lower
operating profit described above and the effect of the items listed below.
Gains on financial instruments of R200 million (US$29 million) compared with
R150 million (US$16 million) for the nine months to March 2003. Finance income
of R28 million (US$4 million) compared with R145 million (US$15 million) in the
prior period.
The exceptional gains were R300 million (US$32 million) compared with the
current year to date income of R257 million (US$37 million).
Net earnings reduced from R2,164 million (US$228 million) in the nine months to
March 2003 to R953 million (US$136 million) for the current nine months to
March 2004.
Detailed and Operational Review
Group overview
Attributable gold production for the March 2004 quarter decreased marginally to
1,033,000 ounces when compared with the December 2003 quarter.
Production from the Australian operations decreased 3 per cent to 184,600
ounces this quarter due to lower volumes at St Ives. Operating profit from the
Australian operations decreased 28 per cent to R119 million (A$23 million,
US$18 million) for the quarter, primarily as a result of the lower production
and increased unit costs at St Ives. The Australian dollar strengthened this
quarter form an average of 4.80 to 5.19 to the rand in the current quarter. The
Ghanaian operations showed a 2 per cent decrease in attributable gold
production to 153,200 ounces partly due to accelerated waste mining in order to
increase mining flexibility at Tarkwa. Ghana contributed operating profit of
R263 million (US$39 million), an 8 per cent increase on the previous quarter's
operating profit.
The improvement in operating profit is due to the higher gold price achieved.
The international operations contributed, R382 million (US$56 million) of the
total operating profit of R656 million (US$96 million) or 58 per cent compared
with R408 million (US$60 million) last quarter of the total operating profit of
R545 million (US$80 million) or 75 per cent.
At the South African operations, production was virtually unchanged at 695,200
ounces. The decrease of approximately 5 per cent in gold production at both
Beatrix and Kloof related to the Christmas break, which was offset by a 6 per
cent increase in output at Driefontein due to the diminished effect of the
fires in the high grade areas this quarter and gold from plant clean up.
Operating profit at the South African operations increased from R137 million
(US$21 million) to R274 million (US$40 million) mainly as a consequence of the
higher gold price and significantly reduced costs.
Group ore milled increased from 11.64 million tons to 11.82 million tons due to
an increase in surface tons mainly at Tarkwa and Driefontein. The overall yield
of 2.9 grams per ton was in line with the December quarter. Total cash costs in
rand terms increased to R67,528 per kilogram from R66,991 per kilogram achieved
last quarter mainly as a result of the lower production and increased costs at
St Ives. In US dollar terms, total cash costs were virtually unchanged at
US$309 per ounce compared with US$308 per ounce. Operating cost per ton at R199
improved from R202 last quarter, the increase in tons milled being offset by
reduced operating costs.
South African Operations
DRIEFONTEIN
March December
2004 2003
Gold produced - 000'ozs 289.6 272.3
Total cash costs - R/kg 67,607 73,126
- US$/oz 310 336
Production at Driefontein increased 6 per cent to 289,600 ounces as a result of
an increased underground yield compared with the previous quarter and clean- up
from the old no. 1 and no. 2 mill processing plants. This is now almost
complete. Underground tonnage decreased mainly due to the Christmas break and
the closure of 5W shaft. In addition, gold production at the West shafts was
optimised by stopping all the low-grade mining, which was not making a
contribution. This resulted in lower underground tonnage at an increased grade
of 8.6 grams per ton compared to 7.5 grams per ton last quarter. Underground
tonnage decreased by 12 per cent to 838,000 tons from 950,000 tons, while
overall tonnage increased by 6 per cent from 1,558,000 tons in the December
quarter to 1,655,000 tons achieved in the current quarter. Although additional
surface material was treated during the Christmas break, the combined yield
remained the same as the previous quarter at 5.4 grams per ton, as a result of
the increase in underground yield.
Operating costs decreased from R648 million to R638 million for the quarter as
last quarter included additional opening up costs due to the fires.
Total cash costs decreased by 8 per cent in rand terms to R67,607 per kilogram
from R73,126 per kilogram last quarter as a result of the increased production.
In US dollar terms the total cash cost decreased by 8 per cent from US$336 per
ounce to US$310 per ounce quarter on quarter. Operating profit more than
doubled, from R68 million (US$11 million) in the December quarter to R158
million (US$23 million) in the current quarter.
Capital expenditure decreased to R29 million (US$6 million) for the quarter
partially due to timing but also because of a deliberate decision to defer
projects where possible that would not affect production, given the current
margin squeeze. This compared with R82 million (US$13 million) in the previous
quarter.
Production volumes for the June quarter will be affected by the Easter break,
an additional public holiday declared in order to vote in the recent elections
and lower gold volumes from surface gold clean-up at no.1 and no. 2 plants in
line with the operational plan. Improved volumes from underground should offset
this. The expected gold output, should, however remain fairly constant when
compared with the March quarter's gold production.
KLOOF
March December
2004 2003
Gold produced - 000'ozs 250.9 265.1
Total cash costs - R/kg 75,920 75,849
- US$/oz 348 349
Gold production at Kloof decreased 5 per cent to 250,900 ounces in the March
quarter. This was due to the reef tons milled from underground being affected
negatively by the extended Christmas break and the slower than expected
production build-up after this break. Underground tonnage decreased to 744,000
tons this quarter from 921,000 tons last quarter, while surface tons increased
33 per cent from 363,000 tons to 483,000 tons, largely in response to the lower
underground tons milled.
The initiative during the last two quarters of mothballing the marginal 9
shaft, accessing VCR pillars and relocating crews from low grade areas to
higher grade panels has resulted in the underground yield increasing from 8.6
grams per ton last quarter to 10.0 grams per ton this quarter. The combined
yield remained at 6.4 grams per ton due to increased treatment from surface
sources during the Christmas break.
Operating costs for the quarter at R617 million (US$91 million) were 5 per cent
lower than the previous quarter's costs of R652 million (US$96 million) in line
with the lower production and the results of good cost control initiatives.
Total cash costs at R75,920 per kilogram were almost unchanged from the
previous quarter of R75,849 per kilogram. In US dollar terms, total cash costs
decreased slightly from US$349 per ounce to US$348 per ounce quarter on
quarter.
Operating profit increased 50 per cent to R75 million (US$11 million) compared
with R50 million (US$7 million) the previous quarter. Capital expenditure
decreased from R87 million (US$14 million) to R57 million (US$10 million) this
quarter. This level of expenditure is expected to be maintained in the June
quarter.
The emphasis remains on repositioning the mines to higher grade areas in order
to combat the strength of the rand's impact on margins. Pillar mining
opportunities and old gold initiatives are receiving attention, while the focus
on increased volumes from underground remains. Gold production for the June
quarter should show an improvement despite the number of public holidays in the
June quarter.
BEATRIX
March December
2004 2003
Gold produced - 000'ozs 154.7 160.8
Total cash costs - R/kg 78,143 77,005
- US$/oz 358 354
Gold production at Beatrix decreased 4 per cent to 154,700 ounces from the
160,800 ounces achieved in the previous quarter. This decrease was mainly due
to lower underground yields. Underground ore milled remained constant at
1,003,000 tons this quarter compared with 1,000,000 tons last quarter, while
surface tons increased 15 per cent from 390,000 tons to 450,000 tons. Toll
processing at Joel accounted for 304,000 of these tons, an increase of 96,000
tons when compared with the December quarter. Lower underground and surface
yields, together with increased surface tonnage resulted in a decrease in the
combined yield from 3.6 grams per ton to 3.3 grams per ton in the March
quarter.
Detailed and focused action plans have restored mining mixes at the various
shafts as reported in the previous quarter. The holing of a number of raise
lines, resolution of logistical and ventilation bottlenecks continue to be
addressed in order to improve tonnage throughput. At 2 shaft, grades have
recovered to planned levels although volumes are still slightly below plan. At
3 shaft exploration drilling from surface and underground has confirmed the
extension of the current facies to the north. Beatrix 4 shaft incurred
operating losses of R18 million (US$3 million) during the quarter. Discussions
with the unions to reduce labour and mine additional shifts, including holidays
and Sundays at 4 shaft, have been successfully completed. This should allow
greater flexibility with an increase in volumes and a decrease in costs in the
next quarter.
Total cash costs increased 1 percent in rand terms to R78,143 per kilogram and
increased to US$358 per ounce from US$354 per ounce last quarter. Operating
profit increased from R18 million (US$3 million) to R40 million (US$6 million)
quarter on quarter mainly due to the higher gold price received. Capital
expenditure decreased from R83 million (US$13 million) last quarter to R67
million (US$12 million) this quarter.
Production in the June 2004 quarter should improve marginally compared with the
March 2004 quarter.
International Operations
Ghana
TARKWA
March December
2004 2003
Gold produced - 000'ozs 137.4 141.8
Total cash costs - US$/oz 237 227
Gold produced for the quarter decreased to 137,400 ounces compared with 141,800
ounces in the December quarter. The decrease in gold production is primarily as
a result of a build up of gold in process on the heaps of 4,500 ounces this
quarter compared with a release of 10,400 ounces in the previous quarter. The
gold in process move reflects the move to stacking on higher lifts on the leach
pads this quarter, and the associated slower gold recovery rates from higher
lifts. With the lag time from gold stacking on the heaps to gold production
being at least three months, this gold in process reversal also reflects lower
volumes of recoverable gold stacked in the December quarter. While ore tonnage
treated only increased by some 6 per cent, total volumes mined increased by
some 23 per cent, reflecting an increase in waste movement. The stripping ratio
increased to 2.7 compared with 2.2 in the December quarter. The increase in
stripping ratio reflects a previously reported drive to increase mining
flexibility, particularly ahead of the conversion to owner mining in the new
fiscal year.
Operating costs increased from US$30 million to US$34 million in line with the
increase in volumes mined. Unit costs increased from US$7.76 per ton treated to
US$8.06 per ton, reflecting the increase in stripping ratio. The increase in
operating expenditure, coupled with the slightly lower gold production, led to
a 4 per cent increase in total cash costs to US$237 per ounce. Tarkwa
contributed US$23 million to operating profit, which is in line with the
previous quarter.
The increase in capital expenditure this quarter from US$28 million to US$45
million reflects expenditure on the mining fleet, which amounted to US$16
million for the quarter compared with US$3 million last quarter and further
expenditure on the mill construction project of US$27 million as compared with
US$20 million last quarter. The mill construction project remains on track for
commissioning in the quarter ended December 2004. The balance of capital
expenditure on this project amounts to US$31 million. The conversion to owner
mining should be finalised by the end of the September 2004 quarter. The
balance of capital expenditure on this project amounts to US$55 million, with
the majority of this expenditure due in the June 2004 quarter.
Gold production is expected to be similar to the levels achieved in the last
two quarters, subject to gold in process movements, which remains difficult to
predict. Operating costs in the June quarter will be similar to the current
levels as the mine continues to focus on maintaining the current strip ratios.
DAMANG
March December
2004 2003
Gold produced - 000'ozs 78.1 77.5
Total cash costs - US$/oz 219 236
Gold produced for the quarter increased to 78,100 ounces compared with 77,500
ounces in the December quarter. A slight reduction in ore tonnages treated, due
to a planned mill shutdown, was offset by an increase in yield from 1.8 gram
per ton to 1.9 gram per ton, due to the availability of larger volumes of high
grades ore from the Damang pit. The tons mined increased by 8 per cent to 4
million tons with the stripping ratio reducing from 1.88 to 1.82. The increase
in volume of ores from the Damang pit, as well as the Kwesie and Lima pits,
reduced the amount of stockpile tonnages treated this quarter in comparison
with the previous quarter.
Operating costs increased marginally to US$17 million in line with the increase
in volumes mined. Total cash costs however reduced from US$236 to US$219
quarter on quarter, largely reflecting limited gold in process charges in this
quarter against some US$15/oz in the December quarter, in line with the
reduction in stockpile consumption in the current quarter referred to earlier.
Unit costs per ton treated remained virtually unchanged. The net result was an
increase in operating profit to US$15 million from US$13 million in the
previous quarter.
Gold production is expected to be slightly lower in the June quarter reflecting
a reduction in the availability of higher grade ores in the Damang pit. Total
cash costs will increase to levels seen in the December quarter reflecting the
lower grades and further consumption of stockpiles and the associated gold in
process charges.
Australia
ST IVES
March December
2003 2003
Gold produced - 000'ozs 131.8 140.1
Total cash costs - A$/oz 442 395
- US$/oz 338 280
Gold production at St Ives was 131,800 ounces, a decrease of 6 per cent when
compared with the December quarter's production of 140,100 ounces. This
decrease was due to a decline in volumes treated largely due to a maintenance
shutdown of the mill and a reduction in the volume of toll treatment, with the
termination of tolling at the South Hannan's mill, interruptions due to heavy
rain and a slight decline in head grades.
Ore production from underground increased by some 30 per cent with ongoing
build up from the Argo and Leviathan mines. This increase in the availability
of high grade ores was offset by grade recovery problems in the Mars pit during
the quarter, leading to lower grades from this key source of ore. As a result
gold production was not maintained as had been expected.
Operating costs at A$56 million (R287 million, US$42 million) were similar to
the previous quarter. Total cash costs were A$442 per ounce (US$338 per ounce)
for the March quarter compared with A$395 per ounce (US$280 per ounce) in the
December quarter. The increase in cash costs reflects the lower volume of gold
produced, the cost of the mill shutdown, a A$5 million gold in process charge
associated with consumption of stockpiles and the impact of continued build-up
at the underground mines. St Ives contributed A$11 million (R58 million, US$9
million) to operating profit compared with A$21 million (R104 million, US$15
million) in the previous quarter. The gold price achieved of A$538 per ounce
was 2 per cent below the December quarter.
Capital expenditure increased to A$50 million (R239 million, US$38 million) in
the March quarter from A$21 million (R107 million, US$16 million) in the
December quarter mainly due to expenditure on the mill optimisation project,
which commenced this quarter and amounted to A$19 million (R91 million, US$ 14
million). In the June quarter it is anticipated that an amount of A$56 million
(R274 million, US$42 million) will be spent.
Gold production and total cash costs should return to levels seen in the
December quarter.
AGNEW
March December
2004 2003
Gold produced - 000'ozs 52.8 50.1
Total cash costs - A$/oz 304 296
- US$/oz 233 210
Gold production at Agnew increased 5 per cent to 52,800 ounces for the quarter.
This reflected an increase in the volume of high grade ores treated from
underground, primarily from the Kim mine, which displaced lower grade
stockpiled ores.
The mine reported a marginal increase in total cash costs in Australian dollars
from A$296 per ounce (US$210 per ounce) last quarter, to this quarter's A$304
per ounce (US$233 per ounce) as a result of increased underground mining
volumes. The contribution to operating profit from Agnew was A$12 million (R61
million, US$9 million) compared with A$13 million (R61 million, US$9 million)
last quarter. Capital expenditure was the same as last quarter at A$7 million
(R30 million, US$5 million) as exploration and development of the underground
operations at Waroonga continued.
Agnew performed above expectations once again and it is unlikely that this
level of production and profitability can be maintained. As a result of the
anticipated closure during the June quarter of the Crusader/Deliverer
underground operation, production in the next quarter is expected to be some 10
to 20 per cent lower than the last two quarters, with a concomitant effect on
margins.
Capital and development projects
ST IVES EXPANSION PROJECT
During the quarter construction of the new 4.5 million ton per annum mill CIP
process plant at St Ives made good progress, following site mobilisation at the
end of the December quarter. In the March quarter, site levelling, construction
of the ROM pad and casting of the SAG mill and crusher foundations were well
advanced, while the SAG mill and ancillary equipment was delivered to site.
By quarter end some 75 per cent of engineering works had been completed while
commitments in respect of 50 per cent of the total capital expenditure had been
made. The project remains on track for commissioning in the December 2004
quarter at a total cost of A$125 million.
TARKWA EXPANSION PROJECT
CIL Process Plant
The new 4.2 million ton per annum mill project advanced satisfactorily during
the quarter and remains on track for commissioning in the quarter ended
December 2004. All major site civil and concrete work has been completed with
delivery and erection of steel work in full swing, while construction of the
tailings dam continued. The fabrication of the mill, which has been on the
critical path, was completed on schedule and the mill is currently being
shipped to Ghana.
Noting that contingency in the budget has been largely exhausted, the project
remains within the US$85 million budgeted, save for possible currency exposure
on the A$ and ZAR, representing a possible US$5 million overrun, which will
depend on currency moves over the next few months.
Conversion to owner mining
The first deliveries of the new mining fleet were made to Tarkwa during the
quarter. By quarter end nine of the eventual twenty four 785C haul trucks had
been delivered. Various graders and dozers have been delivered, commissioned
and are already in service. During the coming quarter the remainder of the haul
trucks and six of the ultimate eight excavators will be delivered.
Screening and recruitment of operators and technical staff, sourced primarily
from the current contract workforce, has commenced, while finalisation of the
majority of the consumable supply contracts is underway.
It is anticipated that the build up of the operations with the new fleet will
occur in the first quarter of F2005 and that by the end of that period the
overlap with the contract mining operator will cease.
ARCTIC PLATINUM PROJECT
Activity at APP continued to focus on the two large tonnage open pittable
deposits at Suhanko, namely Kontijarvi and Ahmavaara. During the March 2004
quarter exploration focused on detailed in-fill drilling at the two deposits,
with particular emphasis on grade control drilling in the areas targeted for
the bulk samples.
Towards the end of the quarter blast hole drilling and sampling at Kontijarvi
and overburden stripping in the trial mine area at Ahmavaara were completed. A
bulk sample of 5,300 tons will be mined from the two deposits during the fourth
quarter and processing at the pilot plant will commence. The pilot plant is
intended to verify process parameters at this scale and to produce concentrate
for downstream processing testwork. The trial mine, pilot scale concentrator
campaign and the subsequent downstream treatment testwork is the critical path
to completion of the feasibility study on this project. It is planned to reach
an investment decision by the end of this calendar year.
DAMANG EXPANSION PROJECT
During the March quarter, a dedicated project team was mobilised to evaluate
the various options for the Damang operation arising from the exploration
programmes undertaken through to the end of the December 2003 quarter.
The project team is now evaluating options that include exploiting new sources
of high grade hydrothermal mineralisation at Rex and Amoanda as well as a
further cut back on the Damang pit, along with incremental sources of soft low
grade feed ores from Tomento and the Lima area. These options are focussed on
near term production, while longer term options of developing an underground
mine below the Damang pit and at the Abosso Deeps area between Tarkwa and
Damang, are also being examined.
The Project team is expected to complete its work by the end of the June 2004
quarter.
Exploration and Corporate
Developmen t
CERRO CORONA IN PERU
During the last quarter, we announced the conclusion of a transaction to
acquire the Cerro Corona gold and copper development project located in
northern Peru.
During this quarter the Company successfully completed the first condition to
closing of the acquisition, that is the completion of due diligence. The
transaction remains subject to completion of the acquisition of all surface
rights required to develop the project and successful permitting. During the
quarter good progress was made with the former aspect while a full time project
team has been established in Peru to advance all elements of the project
development, including the required permitting, which is expected to be
completed in the first half of the 2005 calendar year.
FURTHER CHINA VENTURES
Gold Fields further emphasised the importance of the China region by
establishing a regional representative office in Beijing during the quarter.
Dr.Guocheng Pan, who has consulted extensively for Gold Fields over the past
five years, is managing this office. This office will be responsible for
overseeing the exploration joint ventures with Sino Mining in the Shandong
province and with Fujian Zijin Mining Industry ("Zijin") in the Fujian
province. The Sino Gold Fields Joint Venture ("SGF") is an exploration alliance
and project joint venture agreement with Shandong provincial Bureau of
Geo-Mineral Exploration and Development. The co-operative joint venture is held
70 per cent by SGF of which Gold Fields has a 50 per cent share. The joint
venture with Zijin, of which Gold Fields share 60 per cent, is to explore and
develop gold properties in China's Fujian province. We are currently active in
several other regions of China and it is hoped that Dr. Pan's extensive
contacts in the country will produce results during the coming months.
OTHER PROJECTS
Gold Fields has been very active during the quarter on its extensive inventory
of exploration projects.
In South America, drill programmes were completed at the Cañicapa prospect in
Ecuador as part of the Condor joint venture with IAMGold. Drilling was also
completed at the Incapacha prospect that is a part of the Puquio joint venture
with Buenaventura.
In North America, mobilisation of a new winter camp and supplies has been
completed at the Committee Bay joint venture in Nunavut. A major drill
programme will be completed over the next two quarters on this attractive gold
prospect.
Corporate matters
BLACK ECONOMIC EMPOWERMENT TRANSACTION
On 8 March 2004, shareholders of both Gold Fields Limited ("Gold Fields") and
Mvelaphanda Resources Limited ("Mvela Resources") voted decisively in favour of
all shareholder resolutions necessary to implement the transaction in terms of
which Mvelaphanda Gold (Proprietary) Limited ("Mvela Gold"), a wholly-owned
subsidiary of Mvela Resources, will acquire a 15 per cent beneficial interest
in the South African gold mining assets of Gold Fields, including the
world-class Beatrix, Driefontein and Kloof mines for a cash consideration of
R4,139 million.
All conditions precedent to the transaction were fulfilled following the
completion by Mvela Resources of a domestic and international private placement
on 15 March 2004. Following completion of the private placement Mvela Gold
advanced a loan of R4,139 million ("the GFI-SA Loan") to GFI Mining South
Africa (Proprietary) Limited ("GFI-SA"), a wholly owned subsidiary of Gold
Fields, on 17 March 2004. This loan was financed by way of commercial bank debt
of approximately R1,349 million, mezzanine finance of R1,100 million (which
includes R200 million from Gold Fields) and the balance of approximately R1,690
million raised by the Mvela Resources private placement, (which includes R100
million of equity subscribed for by Gold Fields at the book-build price). At
the end of five years, the GFI-SA loan will be repaid and Mvela Gold will
subscribe for 15 per cent of the share capital of GFI-SA.
The proceeds of the GFI-SA Loan have been applied towards settling R4.1 billion
of the R4.7 billion payable by GFI-SA to Beatrix Mining Ventures Limited,
Driefontein Consolidated (Pty) Limited and Kloof Gold Mining Company Limited
following implementation of the internal reorganisation pursuant to which
GFI-SA has acquired the gold mining assets of these companies as well as
ancillary assets. The net proceeds will be applied to growth projects within
South Africa and internationally. This will include the growth projects in
Ghana and Australia of R1.6 billion (US$240 million), the Arctic Platinum
project which requires capital expenditure of approximately US$260 million
(R1.8 billion) where a decision is due by the end of the calendar year, as well
as the Cerro Corona project which requires US$125 million (R0.9 billion) for
its development. The drop down projects in South Africa, which access reserves
below current infrastructure, could also be part funded from these proceeds.
Gold Fields believes that this transaction satisfies the 15 per cent
Historically Disadvantaged South African ownership requirements of the
scorecard attached to the Broad Based Socio-Economic Mining Scorecard for the
South African mining industry and looks forward, following implementation of
this landmark BEE transaction, to working with Mvela Resources to satisfy the
other requirements of the scorecard.
In terms of the transaction, and in furthering its empowerment objectives,
Mvela Gold appointed two nominees out of a maximum of seven to the GFI-SA
board, and has appointed two members to each of GFI-SA's Operations Committee
and Transformation Committee, which latter committee will be established to
monitor compliance with the Mining Charter and other transformation objectives.
NORILSK BUYS ANGLO AMERICAN'S 20 PER CENT STAKE IN
GOLD FIELDS
On 29 March 2004 Anglo American plc released details of the sale of its 20 per
cent stake in Gold Fields to MMC Norilsk. The purchase was effected through
Norilsk's wholly owned subsidiary Norimet Limited ("Norilsk").
Headquartered and listed in Moscow, as well as via ADR programmes in New York,
London and Berlin, Norilsk is a producer of base and precious metals, with its
main products being Nickel and Palladium.
After preliminary discussions with Norilsk it has been agreed to explore the
potential for co-operation with regards to our respective gold assets.
SALE OF DRIEFONTEIN'S 1C11 BLOCK
As previously reported in the September quarter, Gold Fields concluded a
transaction whereby Driefontein sold a block of ground, referred to as block
1C11, to AngloGold for a consideration of R315 million. Notwithstanding the
fact that Competition Commission approval for the sale had not been received,
this being the only remaining condition precedent, this transaction was
included in the September 2003 quarterly results. Competition Commission
approval was subsequently obtained on 21 January 2004 and the transaction
completed on 20 February 2004 when payment was received.
During a review of our six monthly results the auditors highlighted the fact
that all conditions precedent relating to a transaction should be fulfilled
before a transaction can be accounted for, even despite the fact that the
Competition Commission approval for a transaction of this nature was considered
to be highly likely.
Described in the paragraph below is the impact on net earnings and net earnings
per share for the September 2003 quarter, the December 2003 half year and the
March 2004 quarter had the transaction been accounted for in the March 2004
quarter as opposed to the September 2003 quarter. The timing of the recording
of the transaction had no impact on headline earnings per share in any
quarterly period nor on the year-to-date results to March 2004.
Net earnings and net earnings per share, as reported in the September 2003
quarter, amounted to R421.2 million and 89 cents respectively as compared with
R181.0 million and 38 cents respectively had the sale been excluded. For the
six months ended 31 December 2003 the net earnings and earnings per share were
reported at R698.6 million and 146 cents respectively as compared with R458.4
million and 95 cents respectively had the sale been excluded. For the March
quarter, net earnings of R254.5 million would have increased to R494.7 million
and earnings per share would have increased from 51 cents per share to 102
cents per share. If the sale was included in the March 2004 quarter instead of
the September 2003 quarter, net earnings and net earnings per share would have
been unchanged for the nine months year-to-date as at the end of March 2004.
SCHOOL FUNDED BY GOLD FIELDS OPENED BY NELSON MANDELA
Gold Fields has an extensive programme of community interaction and development
in communities where employees and their families live. Mnyakanya, a school in
Kwa-Zulu Natal, which was suffering from an acute lack of facilities and
amenities for both scholars and teachers, has been given a R6 million extension
by Gold Fields.
This project is an example of how Gold Fields is working with these communities
to build the future. Education is perhaps the greatest need of young people in
South Africa today and we, in Gold fields, are playing our part in ensuring
that as many as possible receive that opportunity in conditions that are
conducive to learning. During the past two years Gold Fields has invested more
than R100 million into education, community development, healthcare, employment
and physical infrastructure projects in such communities.
LEGAL
There have been no further developments to our earlier report in respect of the
law suit filed by Zalumzi Singleton Mtwesi ("Mtwesi") against Gold Fields
Limited in the Supreme Court of the State of New York County of New York on 6
May 2003. In summary, Mtwesi and the plaintiffs' class demand an order
certifying the plaintiffs' class and compensatory damages from Gold Fields
Limited. The suit has not been served on Gold Fields Limited. If and when
service of the suit takes place, it will be vigorously contested. Gold Fields
Limited will keep shareholders apprised of any future developments in this
matter.
Outlook
Gold production is expected to be slightly higher in the June 2004 quarter due
to increased production at both the South African and International operations.
Trading Statement (for the year ending 30 June 2004 versus the year ended 30
June 2003)
Shareholders are advised that the expected net earnings for the financial year
ending 30 June 2004 will be substantially lower than the previous financial
year mainly due to:
� a reduction in the gold price in rand terms from R97,060 per kilogram in the
prior year to R86,642 per kilogram in the current year based on the price level
prevailing at time of issuing this report;
� an increase in operating costs mainly due to above inflation wage increase in
South Africa and the effect of administered price increases;
� a reduction in gains on financial instruments and foreign debt and cash as
well as exceptional items, due to significant gains made in the previous year;
allied with a small reduction in gold produced.
The word "substantially" is defined by the JSE Securities Exchange South Africa
Listings Requirements as meaning a difference equal to or greater than 30 per
cent, "materially" means a difference between 10 per cent and 30 percent and
"significantly" means a difference less than 10 per cent.
The financial information on which this trading statement is based has not been
reviewed or reported on by the company's auditors and shareholders are
therefore advised to exercise caution in trading in their Gold Fields shares
until the release of the results for the financial year, which is expected
during July 2004.
Basis of accounting
The unaudited results for the quarter have been prepared on the International
Financial Reporting Standards (IFRS) basis except for the sale of Driefontein
1C11 block detailed above. Year to date figures are however in accordance with
IFRS. The detailed financial, operational and development results for the March
2004 quarter and nine months are submitted in this report.
These consolidated quarterly statements are prepared in accordance with IFRS
34, Interim Financial Reporting. The accounting policies are consistent with
those applied at the previous year-end.
Income Statement
International Financial Reporting Standards Basis
SA RAND Quarter
March December March
(Figures are in millions unless
otherwise stated
2004 2003 2003
Revenue 3,028.3 2,922.9 3,351.8
Operating costs 2,350.8 2,354.7 2,171.6
Gold inventory change 22.0 23.6 54.1
Operating profit 655.5 544.6 1,126.1
Amortisation and depreciation 297.8 307.5 341.3
Net operating profit 357.7 237.1 784.8
Finance (cost)/income (38.5) 44.9 97.1
- Net interest and investment
(cost)/income (4.4) (15.2) 41.9
- Exchange (losses)/gains on foreign
debt and cash (34.1) 60.1 55.2
Gain on financial instruments 44.2 119.5 185.2
Other income 25.5 3.5 1.3
Exploration (44.4) (35.4) (31.1)
Profit before taxation and
exceptional
items 344.5 369.6 1,037.3
Exceptional gain 20.6 31.4 177.1
Profit before taxation 365.1 401.0 1,214.4
Mining and income taxation 63.8 83.6 377.6
- Normal taxation 70.5 40.0 193.7
- Deferred taxation (6.7) 43.6 183.9
Profit after taxation 301.3 317.4 836.8
Minority interest 46.8 40.0 32.2
Net earnings 254.5 277.4 804.6
Exceptional items:
Profit on sale of investments 47.2 32.3 177.9
Write off of mineral rights (24.7) - -
Sale of mineral rights - - -
Retirement of healthcare obligations (5.0) - -
Disposal of St Helena - - -
Other 3.1 (0.9) (0.8)
Total exceptional items 20.6 31.4 177.1
Taxation (3.4) (6.9) (16.8)
Net exceptional items after tax 17.2 24.5 160.3
Net earnings per share (cents) 51 57 171
Headline earnings 220.8 249.0 643.8
Headline earnings per share (cents) 45 51 136
Diluted earnings per share (cents) 51 56 169
Net earnings excluding gains and
losses on
financial instruments
and foreign debt, net of cash and
exceptional items 237.8 110.4 475.9
Net earnings per share excluding
gains and
losses on financial
instruments and foreign debt, net of
cash
and exceptional items 48 23 101
(cents)
Gold sold � managed kg 34,069 34,451 35,257
Gold price received R/kg 88,887 84,842 95,068
Total cash costs R/kg 67,528 66,991 60,709
Nine months to
March March
(Figures are in millions unless otherwise
stated)
2004 2003
Revenue 8,903.6 10,922.1
Operating costs 7,047.3 6,918.5
Gold inventory change 86.4 (19.7)
Operating profit 1,769.9 4,023.3
Amortisation and depreciation 904.1 1,034.5
Net operating profit 865.8 2,988.8
Finance (cost)/income 28.3 145.0
- Net interest and investment
(cost)/income 1.2 129.8
- Exchange (losses)/gains on foreign
debt and cash 27.1 15.2
Gain on financial instruments 200.1 149.5
Other income 41.4 4.3
Exploration (134.8) (111.4)
Profit before taxation and exceptional
items 1,000.8 3,176.2
Exceptional gain 256.5 300.1
Profit before taxation 1,257.3 3,476.3
Mining and income taxation 184.7 1,212.4
- Normal taxation 158.3 737.0
- Deferred taxation 26.4 475.4
Profit after taxation 1,072.6 2,263.9
Minority interest 119.5 100.3
Net earnings 953.1 2,163.6
Exceptional items:
Profit on sale of investments 95.6 177.9
Write off of mineral rights (24.7) -
Sale of mineral rights 187.2 -
Retirement of healthcare obligations (5.0) -
Disposal of St Helena - 121.7
Other 3.4 0.5
Total exceptional items 256.5 300.1
Taxation 42.0 (36.0)
Net exceptional items after tax 298.5 264.1
Net earnings per share (cents) 197 459
Headline earnings 634.2 1,899.0
Headline earnings per share (cents) 131 403
Diluted earnings per share (cents) 196 455
Net earnings excluding gains and losses on
financial instruments
and foreign debt, net of cash and
exceptional items 484.6 1,785.0
Net earnings per share excluding gains and
losses on financial
instruments and foreign debt, net of cash
and exceptional items 100 378
(cents)
Gold sold � managed kg 102,777 108,892
Gold price received R/kg 86,630 100,302
Total cash costs R/kg 67,360 61,263
Income Statement
International Financial Reporting Standards Basis
US DOLLARS
(Figures are in millions unless otherwise stated)
Quarter
March December March
2004 2003 2003
Revenue 444.4 430.7 396.7
Operating costs 345.3 346.7 256.1
Gold inventory change 3.2 3.6 5.2
Operating profit 95.9 80.4 135.4
Amortisation and depreciation 43.8 45.2 40.0
Net operating profit 52.1 35.2 95.4
Finance (cost)/income (5.3) 6.4 10.4
- Net interest and investment (cost)/ (0.6) (2.0) 4.9
income
- Exchange (losses)/gains on foreign
debt
and cash (4.7) 8.4 5.5
Gain on financial instruments 6.6 17.1 19.2
Other income 3.7 0.5 0.2
Exploration (6.6) (5.3) (3.7)
Profit before taxation and exceptional 50.5 53.9 121.5
items
Exceptional gain 3.4 5.7 19.4
Profit before taxation 53.9 59.6 140.9
Mining and income taxation 9.3 12.1 44.6
- Normal taxation 10.2 6.0 23.5
- Deferred taxation (0.9) 6.1 21.1
Profit after taxation 44.6 47.5 96.3
Minority interest 6.9 5.8 3.7
Net earnings 37.7 41.7 92.6
Exceptional items:
Profit on sale of investments 6.9 4.6 18.7
Write off of mineral rights (2.0) - -
Sale of mineral rights - - -
Retirement of healthcare obligations (0.7) - -
Disposal of St Helena - - 0.7
Other (0.7) 1.1 -
Total exceptional items 3.4 5.7 19.4
Taxation (0.4) (0.6) (1.9)
Net exceptional items after tax 3.0 5.1 17.5
Net earnings per share (cents) 7 9 20
Headline earnings 32.4 36.1 74.8
Headline earnings per share (cents) 7 7 16
Diluted earnings per share (cents) 7 8 19
Net earnings excluding gains and losses
on
financial instruments and foreign debt,
net
of cash and exceptional items 34.4 16.5 57.7
Net earnings per share excluding gains
and
losses on financial
instruments and foreign debt, net of
cash and
exceptional items 7 3 12
(cents)
Exchange rate � SA Rand/US Dollar 6.79 6.76 8.38
Gold sold � managed ozs (000) 1,095 1,108 1,134
Gold price received $/oz 407 390 353
Total cash costs $/oz 309 308 225
US DOLLARS
(Figures are in millions unless otherwise stated)
Nine months to
March March
2004
2003
Revenue 1,271.9 1,148.5
Operating costs 1,006.8 727.5
Gold inventory change 12.3 (2.1)
Operating profit 252.8 423.1
Amortisation and depreciation 129.2 108.8
Net operating profit 123.6 314.3
Finance (cost)/income 4.1 15.2
- Net interest and investment (cost)/income 0.2 13.6
- Exchange (losses)/gains on foreign debt 3.9 1.6
and cash
Gain on financial instruments 28.6 15.7
Other income 5.9 0.5
Exploration (19.3) (11.7)
Profit before taxation and exceptional items 142.9 334.0
Exceptional gain 36.6 31.6
Profit before taxation 179.5 365.6
Mining and income taxation 26.4 127.5
- Normal taxation 22.6 77.5
- Deferred taxation 3.8 50.0
Profit after taxation 153.1 238.1
Minority interest 17.1 10.5
Net earnings 136.0 227.6
Exceptional items:
Profit on sale of investments 13.7 18.7
Write off of mineral rights (2.0) -
Sale of mineral rights 25.2 -
Retirement of healthcare obligations (0.7) -
Disposal of St Helena - 12.8
Other 0.4 0.1
Total exceptional items 36.6 31.6
Taxation 6.0 (3.8)
Net exceptional items after tax 42.6 27.8
Net earnings per share (cents) 28 48
Headline earnings 90.6 199.7
Headline earnings per share (cents) 19 42
Diluted earnings per share (cents) 28 48
Net earnings excluding gains and losses on
financial instruments
and foreign debt, net of cash and 69.2 187.7
exceptional items
Net earnings per share excluding gains and
losses on financial
instruments and foreign debt, net of cash
and
exceptional items 14 40
(cents)
Exchange rate � SA Rand/US Dollar 7.00 9.51
Gold sold � managed ozs (000) 3,304 3,501
Gold price received $/oz 385 328
Total cash costs $/oz 299 200
Balance Sheets
International Financial Reporting Standards Basis
SA RAND US DOLLARS
(Figures are in millions) March June March June
2004 2004
2003 2003
Mining and mineral assets 15,891.4 15,371.3 2,437.3 1,973.2
Non-current assets 295.1 275.0 45.3 35.3
Investments 970.0 512.1 148.8 65.7
Current assets 7,061.9 3,059.5 1,083.1 392.7
- Other current assets 2,361.0 2,018.7 362.1 259.1
- Net cash and deposits 4,700.9 1,040.8 721.0 133.6
Total assets 24,218.4 19,217.9 3,714.5 2,466.9
Shareholders' equity 15,850.7 11,295.5 2,431.1 1,450.0
Minority interest 578.7 668.2 88.8 85.8
Deferred taxation 3,559.5 4,279.6 545.9 549.4
Long-term loans 1,496.6 164.2 229.5 21.1
Environmental
rehabilitation
provisions 721.8 715.3 110.7 91.8
Post-retirement health
care
provisions 54.7 90.7 8.4 11.6
Current liabilities 1,956.4 2,004.4 300.1 257.2
- Other current 1,818.6 1,844.7
279.0 236.7
liabilities
- Current portion of
long-term loans 137.8 159.7 21.1 20.5
Total equity and 24,218.4 19,217.9 3,714.5 2,466.9
liabilities
S.A. Rand/U.S. Dollar
conversion rate 6.52 7.79
Condensed Statements of Changes in Equity
International Financial Reporting Standards Basis
SA RAND US DOLLARS
(Figures are in millions) March March March March
2004 2003 2004 2003
Balance as at the
beginning
of the financial year 11,295.5 11,095.8 1,450.0 1,071.0
Currency translation
adjustment and other (466.4) (758.6) 231.4 203.6
Issue of share capital 9.5 0.8 1.4 0.1
Increase in share premium 1,562.9 17.2 223.3 1.8
Equity component of Mvela
loan 3,130.2 - 447.2 -
Marked to market valuation
of listed investments 35.0 (113.8) 5.0 (12.0)
Dividends (669.1) (1,746.4) (63.2) (184.3)
Net earnings 953.1 2,163.6 136.0 227.6
Balance as at the end of
March 15,850.7 10,658.6 2,431.1 1,307.8
Reconciliation of Headline Earnings with Net Earnings
SA RAND
(Figures are in millions unless otherwise stated)
March December March
2004 2003 2003
Net earnings 254.5 277.4 804.6
Profit on sale of investments (47.2) (32.3) (177.9)
Taxation effect of profit on sale of
investments 13.5 6.9 16.8
Profit on sundry asset sales - (3.0) 0.3
Headline earnings 220.8 249.0 643.8
Headline earnings per share � cents 45 51 136
Based on headline earnings as given
above divided by 491,254,653
(December 2003 � 484,511,921 and
March 2003 �472,000,578) being the
weighted average number of ordinary
shares in issue
US DOLLARS
(Figures are in millions unless otherwise stated)
March December March
2004 2003 2003
Net earnings 37.7 41.7 92.6
Profit on sale of investments (9.1) (4.6) (18.7)
Taxation effect of profit on sale of
investments 3.8 0.6 1.9
Profit on sundry asset sales - (1.6) (1.0)
Headline earnings 32.4 36.1 74.8
Headline earnings per share � cents 7 7 16
Based on headline earnings as given
above divided by 491,254,653
(December 2003 � 484,511,921 and
March 2003 �472,000,578) being the
weighted average number of ordinary
shares in issue
Cash Flow Statements
International Financial
Reporting Standards Basis
SA RAND
(Figures are in millions)
Quarter Nine months to
March December March March March
2004 2003 2003 2004 2003
Cash flow from operating 527.7 676.7 1,213.6 1,236.0 3,549.7
activities
Profit before tax and 344.6 369.6 1,037.3 1,000.8 3,176.2
exceptional items
Exceptional items 20.6 31.4 177.1 256.5 300.1
Amortisation and 297.8 307.5 341.3 904.1 1,034.5
depreciation
Change in working capital 94.3 85.5 251.9 (31.4) 232.5
Taxation paid (119.2) (50.7) (135.1) (473.2) (663.2)
Other non-cash items (110.4) (66.6) (458.9) (420.8) (530.4)
Dividends paid (196.7) - (707.9) (669.1) (1,775.5)
Ordinary shareholders (196.7) - (707.9) (669.1) (1,746.4)
Minority shareholders in - - - - (29.1)
subsidiaries
Cash utilised in investing (654.5) (647.3) (323.3) (2,067.8) (1,384.1)
activities
Capital expenditure � (748.8) (662.0) (505.3) (1,963.5) (1,592.5)
additions
Capital expenditure � 326.6 29.5 - 412.6 -
proceeds on disposal
Purchase of investments (342.8) (57.3) (4.0) (680.4) (78.0)
Sale of investments 130.1 54.2 203.1 201.9 203.1
Proceeds on the disposal - - - - 120.0
of investments/subsidiary
Environmental and (19.6) (11.7) (17.1) (38.4) (36.7)
post-retirement health
care payments
Cash flow from financing 4,007.8 1,407.3 (209.9) 5,353.2 (414.9)
activities
Debt portion of Mvela loan 2,453.6 - - 2,453.6 -
Equity portion of Mvela 1,653.4 - - 1,653.4 -
loan
Loans repaid (100.1) (103.2) (195.9) (293.9) (396.4)
Minority shareholder's - 15.7 (16.2) 28.1 (51.7)
loan received/(repaid)
Shares issued 0.9 1,494.8 2.2 1,512.0 33.2
Net cash inflow/(outflow) 3,684.3 1,436.7 (27.5) 3,852.3 (24.8)
Translation adjustment (87.4) (53.4) (77.0) (192.2) (180.9)
Cash at beginning of 1,104.0 (279.3) 1,925.9 1,040.8 2,027.1
period
Cash at end of period 4,700.9 1,104.0 1,821.4 4,700.9 1,821.4
US DOLLARS
(Figures are in millions)
Quarter Nine months to
March December March March March
2004 2003 2003 2004 2003
Cash flow from operating 76.8 95.5 141.3 176.5 373.3
activities
Profit before tax and 50.5 53.9 121.5 142.9 334.0
exceptional items
Exceptional items 3.4 5.7 19.4 36.6 31.6
Amortisation and 43.8 45.2 40.0 129.2 108.8
depreciation
Change in working capital 13.2 10.7 26.3 (4.5) 24.4
Taxation paid (17.7) (9.1) (17.3) (67.6) (69.7)
Other non-cash items (16.4) (10.9) (48.6) (60.1) (55.8)
Dividends paid (29.4) - (87.7) (92.6) (187.2)
Ordinary shareholders (29.4) - (87.7) (92.6) (184.3)
Minority shareholders in - - - - (2.9)
subsidiaries
Cash utilised in investing (96.5) (96.0) (40.9) (295.5) (146.3)
activities
Capital expenditure
� additions (109.4) (96.8) (59.5) (280.5) (167.5)
Capital expenditure � 46.8 4.5 - 58.9 -
proceeds on disposal
Purchase of investments (49.7) (9.8) (0.8) (97.2) (8.2)
Sale of investments 18.7 7.7 21.4 28.8 21.4
Proceeds on the disposal - - - - 11.9
of investments/subsidiary
Environmental and (2.9) (1.6) (2.0) (5.5) (3.9)
post-retirement health
care payments
Cash flow from financing 576.3 198.2 (21.3) 766.0 (43.5)
activities
Debt portion of Mvela loan 350.5 - - 350.5 -
Equity portion of Mvela 236.2 - - 236.2 -
loan
Loans repaid (13.7) (14.6) (20.4) (40.7) (41.9)
Minority shareholder's 0.1 2.2 (1.3) 4.0 (5.1)
loan received/(repaid)
Shares issued 3.2 210.6 0.4 216.0 3.5
Net cash inflow/(outflow) 527.2 197.7 (8.6) 554.4 (3.7)
Translation adjustment 33.1 1.8 14.7 33.0 31.5
Cash at beginning of 160.7 (38.8) 217.4 133.6 195.7
period
Cash at end of period 721.0 160.7 223.5 721.0 223.5
Hedging / Derivatives
Policy
The Group's policy is to remain unhedged. 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.
Gold Fields has various currency financial instruments - those remaining are
described in the schedule. It has been decided not to account for these
instruments under the hedge accounting rules of IFRS 39, except for the debt
portion of the interest rate swap which has been hedge accounted, and
accordingly the positions have been marked to market.
On 7 January 2004, Gold Fields Australia closed out the Australian dollar/
United States dollar currency financial instruments. The existing forward
purchases of Australian dollars and the put and call options were closed out by
entering into equal and opposite transactions. The close out of the outstanding
open position of US$275 million was at an average spot rate of 0.7670 US$/AU$.
These transactions locked in gross profit amounting to US$115.7 million and the
underlying cash receipts were deferred to match the maturity dates of the
original transactions. An amount of US$102.8 million had already been accounted
for up until the end of December 2003. In addition, in order that the Group is
able to participate in further Australian dollar appreciation, a strip of
quarterly maturing Australian dollar/US dollar call options were purchased in
respect of an amount of US$275 million of which the value dates and amounts
match those of the original structure. The Australian dollar call options
resulted in a premium of US$8.3 million. The payment of the premium will match
the maturity dates of the original structure. The average strike price of the
options is 0.7670 US$/AU$. The future US dollar locked-in value and cost of the
new structure is depicted in the table below:
Payment value dates Gross Future Premium Net Future
(All figures in US dollars 000's) Cash Flows Payable Cash flows
31 March 2004 6,632 217 6,415
30 June 2004 6,433 278 6,155
30 September 2004 11,578 628 10,950
31 December 2004 11,216 676 10,540
31 March 2005 10,911 716 10,195
30 June 2005 10,634 749 9,885
30 September 2005 10,336 776 9,560
30 December 2005 10,074 799 9,275
31 March 2006 9,845 825 9,020
30 June 2006 9,568 848 8,720
29 September 2006 9,331 871 8,460
29 December 2006 9,140 895 8,245
TOTAL 115,698 8,278 107,420
The call options purchased at a cost of US$8.3 million are detailed below:
US DOLLAR / AUSTRALIAN DOLLAR
Year ended 30 June 2004 2005 2006 2007 TOTAL
Australian dollar call options:
Amount (US Dollars) -000's 12,500 87,500 100,000 75,000 275,000
Average strike price -(US$/AU$) 0.7670 0.7670 0.7670 0.7670 0.7670
The marked to market value of all transactions making up the positions in the
above table was a positive US$5.1 million. This was based on an exchange rate
of AUD/USD 0.7515. The value was based on the prevailing interest rates and
volatilities at the time.
US DOLLAR / RAND
Year ended 30 June 2004 2005 2006 2007 TOTAL
Forward purchases:
Amount (US Dollars) -000's 50,000 - - - 50,000
Average rate -(ZAR/US$) 8.4264 - - - 8.4264
The total forward purchase of US$50 million matures on 3 June 2004. The marked
to market value of all transactions making up the positions in the above table
was a negative R88.8 million (US$13.6 million negative). The value was based on
an exchange rate of ZAR/US$6.52 and the prevailing interest rates and
volatilities at the time.
INTEREST SWAP
In terms of the Mvela loan, GFI Mining SA pays Mvela Gold interest on R4,139
million at a fixed interest rate, semi-annually. The interest rate was fixed
with reference to the 5 year ZAR swap rate, at 9.6179% plus a margin of 0.95%.
GFI Mining SA simultaneously entered into an interest rate swap agreement
converting a fixed interest rate exposure to a floating rate. In terms of the
swap GFI Mining SA is now exposed to the 3 Month Jibar rate plus a margin of
1.025%.
For accounting purposes the Mvela loan is split into a debt component and an
equity component and accordingly the net present value of future interest
payments (R1,654 million) is classified as debt, while the balance (R2,485
million) is categorised as equity. The marked to market value of the interest
rate swap is a loss of R48 million, which is accounted for in the income
statement. The fair value adjustment of the debt portion of the loan is a gain
of R19 million, to which hedge accounting is applied. In terms of hedge
accounting, the liability that exists on the balance sheet (the loan of R1.6
billion) is decreased accordingly and the gain of R19 million is taken to the
income statement, partly offsetting the R48 million above. The net impact on
earnings is R29 million pre-tax and R22 million after tax.
From a cash flow perspective the marked to market loss is offset by the present
value of the interest saving on the loan over the life of the loan. The value
was based on the prevailing interest rates and volatilities at the time.
Total Cash Costs
Gold Institute Industry Standard
SA OPERATIONS
Total Mine
(All figures are in Rand millions unless otherwise stated)
Operations Total Driefontein
Operating(1) costs
March 2004 2,350.8 1,643.8 637.6
December 2003 2,354.7 1,700.2 648.0
Financial year to date 7,047.3 5,029.8 1,921.7
Gold in process
and inventory
change*
March 2004 15.0 - -
December 2003 21.9 - -
Financial year to date 73.3 - -
Less:
Rehabilitation
costs
March 2004 10.3 9.2 2.8
December 2003 10.0 9.0 2.8
Financial year to date 30.5 27.2 8.4
Production taxes
March 2004 7.6 7.6 0.3
December 2003 8.7 8.7 2.1
Financial year to date 24.1 24.1 4.3
General and admin
March 2004 85.3 57.1 25.8
December 2003 88.4 61.5 25.9
Financial year to date 256.3 171.6 75.3
Cash operating
costs
March 2004 2,262.6 1,569.9 608.7
December 2003 2,269.5 1,621.0 617.2
Financial year to date 6,809.7 4,806.9 1,833.7
Plus: Production
taxes
March 2004 7.6 7.6 0.3
December 2003 8.7 8.7 2.1
Financial year to date 24.1 24.1 4.3
Royalties
March 2004 30.4 - -
December 2003 29.7 - -
Financial year to date 89.3 - -
TOTAL CASH COSTS
(2)
March 2004 2,300.6 1,577.5 609.0
December 2003 2,307.9 1,629.7 619.3
Financial year to date 6,923.1 4,831.0 1,838.0
Plus: Amortisation
*
March 2004 281.3 143.2 60.1
December 2003 285.4 137.4 53.5
Financial year to date 846.1 418.2 170.7
Rehabilitation
March 2004 10.3 9.2 2.8
December 2003 10.0 9.0 2.8
Financial year to date 30.5 27.2 8.4
TOTAL PRODUCTION
COSTS(3)
March 2004 2,592.2 1,729.9 671.9
December 2003 2,603.3 1,776.1 675.6
Financial year to date 7,799.7 5,276.4 2,017.1
Gold sold�
thousand ounces
March 2004 1,095.3 695.2 289.6
December 2003 1,107.6 698.1 272.3
Financial year to date 3,304.4 2,103.9 850.9
TOTAL CASH COSTS �
US$/oz
March 2004 309 334 310
December 2003 308 345 336
Financial year to date 299 328 309
TOTAL
PRODUCTION COSTS -
US$/oz
March 2004 349 366 342
December 2003 348 376 367
Financial year to date 337 358 339
Kloof Beatrix Total
Operating costs(1)
March 2004 616.5 389.7 707.0
December 2003 651.6 400.6 654.5
Financial year to date 1,917.3 1,190.8 2,017.5
Gold in process
and inventory
change*
March 2004 - - 15.0
December 2003 - - 21.9
Financial year to date - - 73.3
Less:
Rehabilitation
costs
March 2004 5.5 0.9 1.1
December 2003 5.4 0.8 1.0
Financial year to date 16.2 2.6 3.3
Production taxes
March 2004 5.0 2.3 -
December 2003 4.9 1.7 -
Financial year to date 14.3 5.5 -
General and admin
March 2004 18.6 12.7 28.2
December 2003 20.9 14.7 26.9
Financial year to date 58.0 38.3 84.7
Cash operating
costs
March 2004 587.4 373.8 692.7
December 2003 620.4 383.4 648.5
Financial year to date 1,828.8 1,144.4 2,002.8
Plus: production
taxes
March 2004 5.0 2.3 -
December 2003 4.9 1.7 -
Financial year to date 14.3 5.5 -
Royalties
March 2004 - - 30.4
December 2003 - - 29.7
Financial year to date - - 89.3
TOTAL CASH COSTS
(2)
March 2004 592.4 376.1 723.1
December 2003 625.3 385.1 678.2
Financial year to 1,843.1 1,149.9 2,092.1
date
Plus: Amortisation
*
March 2004 62.0 21.1 138.1
December 2003 63.2 20.7 148.0
Financial year to 184.7 62.8 427.9
date
Rehabilitation
March 2004 5.5 0.9 1.1
December 2003 5.4 0.8 1.0
Financial year to date 16.2 2.6 3.3
TOTAL PRODUCTION
COSTS (3)
March 2004 659.9 398.1 862.3
December 2003 693.9 406.6 827.2
Financial year to date 2,044.0 1,215.3 2,523.3
Gold sold �
thousand ounces
March 2004 250.9 154.7 400.1
December 2003 265.1 160.8 409.5
Financial year to date 778.4 474.7 1,200.4
TOTAL CASH COSTS �
US$/oz
March 2004 348 358 266
December 2003 349 354 245
Financial year to date 338 346 249
TOTAL PRODUCTION
COSTS - US$/oz
March 2004 387 379 317
December 2003 387 374 299
Financial year to date 375 366 300
INTERNATIONAL
Ghana
Tarkwa Damang
Operating costs(1)
March 2004 228.9 115.7
December 2003 206.0 112.6
Financial year to date 654.5 347.5
Gold in process and
inventory change*
March 2004 (7.2) (2.8)
December 2003 11.9 8.2
Financial year to date 15.7 4.9
Less: Rehabilitation costs
March 2004 0.2 0.2
December 2003 0.1 0.3
Financial year to date 0.5 0.8
Production taxes
March 2004 - -
December 2003 - -
Financial year to date - -
General and admin
March 2004 11.5 3.1
December 2003 11.5 2.9
Financial year to date 35.0 9.1
Cash operating costs
March 2004 210.0 109.6
December 2003 206.3 117.6
Financial year to date 634.7 342.5
Plus: Production taxes
March 2004 - -
December 2003 - -
Financial year to date - -
Royalties
March 2004 11.5 6.5
December 2003 11.3 6.3
Financial year to date 34.7 18.4
TOTAL CASH COSTS(2)
March 2004 221.5 116.1
December 2003 217.6 123.9
Financial year to date 669.4 360.9
Plus: Amortisation*
March 2004 23.4 14.5
December 2003 25.2 12.0
year to date 76.1 40.9
Financial Rehabilitation
March 2004 0.2 0.2
December 2003 0.1 0.3
Financial year to date 0.5 0.8
TOTAL PRODUCTION COSTS (3)
March 2004 245.1 130.8
December 2003 242.9 136.2
Financial year to date 746.0 402.6
Gold sold � thousand ounces
March 2004 137.4 78.1
December 2003 141.8 77.5
Financial year to date 426.9 225.8
TOTAL CASH COSTS � US$/oz
March 2004 237 219
December 2003 227 236
Financial year to date 224 228
TOTAL PRODUCTION COSTS -
US$/oz
March 2004 263 247
December 2003 253 260
Financial year to date 250 256
Australia St Ives Agnew
Operating costs (1)
March 2004 287.4 75.0
December 2003 272.5 63.4
Financial year to date 808.5 207.0
Gold in process and
inventory change*
March 2004 17.9 7.1
December 2003 (4.7) 6.5
Financial year to date 25.6 27.1
Less: Rehabilitation costs
March 2004 0.5 0.2
December 2003 0.4 0.2
Financial year to date 1.4 0.6
Production taxes
March 2004 - -
December 2003 - -
Financial year to date - -
General and admin
March 2004 11.7 1.9
December 2003 10.7 1.8
Financial year to date 35.5 5.1
Cash operating costs
March 2004 293.1 80.0
December 2003 256.7 67.9
Financial year to date 797.2 228.4
Plus: Production taxes
March 2004 - -
December 2003 - -
Financial year to date - -
Royalties
March 2004 9.1 3.3
December 2003 8.9 3.2
Financial year to date 26.6 9.6
TOTAL CASH COSTS(2)
March 2004 302.2 83.3
December 2003 265.6 71.1
Financial year to date 823.8 238.0
Plus: Amortisation*
March 2004 100.2
December 2003 110.8
Financial year to date 310.9
Rehabilitation
March 2004 0.7
December 2003 0.6
Financial year to date 2.0
TOTAL PRODUCTION COSTS (3)
March 2004 486.4
December 2003 448.1
Financial year to date 1,374.7
Gold sold � thousand ounces
March 2004 131.8 52.8
December 2003 140.1 50.1
Financial year to date 399.0 148.8
TOTAL CASH COSTS � US$/oz
March 2004 338 232
December 2003 280 210
Financial year to date 295 229
TOTAL PRODUCTION COSTS -
US$/oz
March 2004 388
December 2003 348
Financial year to date 359
DEFINITIONS
Total cash costs and Total production costs 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 costs � Operating costs less off-mine costs, including general
and administration costs, as detailed in the table above.
(3) Total production costs � Total cash costs 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 are US$1 = R6.79 and US$1 = R6.76 for the March 2004 and
December 2003 quarters respectively.
Operating and Financial Results
SA RAND SA Operations
Total Mine
Operations Total
Operating Results
Ore milled / treated
(000 tons)
March 2004 11,815 4,335
December 2003 11,640 4,232
Financial year to date 34,952 12,800
Yield (grams per ton)
March 2004 2.9 5.0
December 2003 3.0 5.1
Financial year to date 2.9 5.1
Gold produced
(kilograms)
March 2004 34,069 21,624
December 2003 34,451 21,714
Financial year to date 102,777 65,440
Gold sold (kilograms)
March 2004 34,069 21,624
December 2003 34,451 21,714
Financial year to date 102,777 65,440
Gold price received
(Rand per kilogram)
March 2004 88,887 88,665
December 2003 84,842 84,586
Financial year to date 86,630 86,424
Total cash costs (Rand
per kilogram)
March 2004 67,528 72,951
December 2003 66,991 75,053
Financial year to date 67,360 73,823
Total production costs
(Rand per kilogram)
March 2004 76,087 79,999
December 2003 75,565 81,795
Financial year to date 75,890 80,630
Operating costs (Rand
per ton)
March 2004 199 379
December 2003 202 402
Financial year to date 202 393
Financial Results (Rand
million)
Revenue
March 2004 3,028.3 1,917.3
December 2003 2,922.9 1,836.7
Financial year to date 8,903.6 5,655.6
Operating costs
March 2004 2,350.8 1,643.8
December 2003 2,354.7 1,700.2
Financial year to date 7,047.3 5,029.8
Gold inventory change
March 2004 22.0 -
December 2003 23.6 -
Financial year to date 86.4 -
Operating profit
March 2004 655.5 273.5
December 2003 544.6 136.5
Financial year to date 1,769.9 625.8
Amortisation of mining
assets
March 2004 274.3 143.2
December 2003 283.8 137.5
Financial year to date 833.1 418.3
Net operating profit
March 2004 381.2 130.3
December 2003 260.8 (1.0)
Financial year to date 936.8 207.5
Other income/(expenses)
March 2004 56.3 (42.3)
December 2003 120.9 (17.0)
Financial year to date 232.0 (69.8)
Profit before taxation
March 2004 437.5 88.0
December 2003 381.7 (18.0)
Financial year to date 1,168.8 137.7
Mining and income
taxation
March 2004 78.1 (31.7)
December 2003 95.4 (22.7)
Financial year to date 227.0 (116.6)
- Normal taxation
March 2004 54.0 18.2
December 2003 34.2 (0.2)
Financial year to date 123.2 19.3
- Deferred taxation
March 2004 24.1 (49.9)
December 2003 61.2 (22.5)
Financial year to date 103.8 (135.9)
Exceptional items
March 2004 (1.6) (1.6)
December 2003 (0.2) (2.1)
Financial year to date 186.6 183.5
Net earnings
March 2004 357.8 118.1
December 2003 286.1 2.6
Financial year to date 1,128.4 437.8
Capital expenditure
(Rand million)
March 2004 703.9 152.7
December 2003 586.1 251.9
Financial year to date 1,825.9 693.2
Planned for next six 1,981.1 432.6
months to September 2004
Driefontein Kloof Beatrix
Operating Results
Ore milled / treated
(000 tons)
March 2004 1,655 1,227 1,453
December 2003 1,558 1,284 1,390
Financial year to date 4,816 3,758 4,226
Yield (grams per
ton)
March 2004 5.4 6.4 3.3
December 2003 5.4 6.4 3.6
Financial year to date 5.5 6.4 3.5
Gold produced
(kilograms)
March 2004 9,008 7,803 4,813
December 2003 8,469 8,244 5,001
Financial year to date 26,465 24,210 14,765
Gold sold
(kilograms)
March 2004 9,008 7,803 4,813
December 2003 8,469 8,244 5,001
Financial year to date 26,465 24,210 14,765
Gold price received
(Rand per kilogram)
March 2004 88,321 88,633 89,362
December 2003 84,579 85,104 83,743
Financial year to date 86,189 86,625 86,515
Total cash costs
(Rand per kilogram)
March 2004 67,607 75,920 78,143
December 2003 73,126 75,849 77,005
Financial year to date 69,450 76,130 77,880
Total production
costs (Rand per
kilogram)
March 2004 74,589 84,570 82,713
December 2003 79,773 84,170 81,304
Financial year to date 76,218 84,428 82,310
Operating costs
(Rand per ton)
March 2004 385 502 268
December 2003 416 507 288
Financial year to date 399 510 282
Financial Results
(Rand million)
Revenue
March 2004 795.6 691.6 430.1
December 2003 716.3 701.6 418.8
Financial year to date 2,281.0 2,097.2 1,277.4
Operating costs
March 2004 637.6 616.5 389.7
December 2003 648.0 651.6 400.6
Financial year to date 1,921.7 1,917.3 1,190.8
Gold inventory
change
March 2004 - - -
December 2003 - - -
Financial year to date - - -
Operating profit
March 2004 158.0 75.1 40.4
December 2003 68.3 50.0 18.2
Financial year to date 359.3 179.9 86.6
Amortisation of
mining assets
March 2004 60.1 62.0 21.1
December 2003 53.6 63.2 20.7
Financial year to date 170.8 184.7 62.8
Net operating profit
March 2004 97.9 13.1 19.3
December 2003 14.7 (13.2) (2.5)
Financial year to date 188.5 (4.8) 23.8
Other income/
(expenses)
March 2004 (18.1) (12.5) (11.7)
December 2003 (11.0) (1.4) (4.6)
Financial year to date (35.3) (18.0) (16.5)
Profit before
taxation
March 2004 79.8 0.6 7.6
December 2003 3.7 (14.6) (7.1)
Financial year to date 153.2 (22.8) 7.3
Mining and income
taxation
March 2004 (20.2) (14.5) 3.0
December 2003 (4.5) (15.5) (2.7)
Financial year to date (66.8) (54.0) 4.2
- Normal taxation
March 2004 5.6 6.2 6.4
December 2003 (0.1) (0.3) 0.2
Financial year to date 6.1 6.5 6.7
- Deferred taxation
March 2004 (25.8) (20.7) (3.4)
December 2003 (4.4) (15.2) (2.9)
Financial year to date (72.9) (60.5) (2.5)
Exceptional items
March 2004 (0.9) (0.7) -
December 2003 (1.0) (1.2) 0.1
Financial year to date 185.3 (1.9) 0.1
Net earnings
March 2004 99.1 14.4 4.6
December 2003 7.2 (0.3) (4.3)
Financial year to date 405.3 29.3 3.2
Capital expenditure
Rand million)
March 2004 29.0 56.9 66.8
December 2003 81.7 87.4 82.8
Financial year to date 198.6 268.0 226.6
Planned for next six 136.5 147.4 148.7
months to September
2004
Operating and Financial Results
SA RAND International
Total Ghana
Tarkwa Damang
Operating Results
Ore milled /treated
(000 tons)
March 2004 7,480 4,165 1,301
December 2003 7,408 3,918 1,358
Financial year to date 22,152 12,163 3,845
Yield (grams per ton)
March 2004 1.7 1.0 1.9
December 2003 1.7 1.1 1.8
Financial year to date 1.7 1.1 1.8
Gold produced
(kilograms)
March 2004 12,445 4,274 2,430
December 2003 12,737 4,409 2,411
Financial year to date 37,337 13,278 7,022
Gold sold (kilograms)
March 2004 12,445 4,274 2,430
December 2003 12,737 4,409 2,411
Financial year to date 37,337 13,278 7,022
Gold price received
(Rand per kilogram)
March 2004 89,273 88,956 89,177
December 2003 85,279 85,076 86,105
Financial year to date 86,991 86,768 87,098
Total cash costs (Rand
per kilogram)
March 2004 58,104 51,825 47,778
December 2003 53,246 49,354 51,389
Financial year to date 56,033 50,414 51,396
Total production costs
(Rand per kilogram)
March 2004 69,289 57,347 53,827
December 2003 64,945 55,092 56,491
Financial year to date 67,582 56,183 57,334
Operating costs (Rand
per ton)
March 2004 95 55 89
December 2003 88 53 83
Financial year to date 91 54 90
Financial Results (Rand
million)
Revenue
March 2004 1,111.0 380.2 216.7
December 2003 1,086.2 375.1 207.6
Financial year to date 3,248.0 1,152.1 611.6
Operating costs
March 2004 707.0 228.9 115.7
December 2003 654.5 206.0 112.6
Financial year to date 2,017.5 654.5 347.5
Gold inventory change
March 2004 22.0 (8.0) (2.8)
December 2003 23.6 12.7 8.2
Financial year to date 86.4 16.6 4.9
Operating profit
March 2004 382.0 159.3 103.8
December 2003 408.1 156.4 86.8
Financial year to date 1,144.1 481.0 259.2
Amortisation of mining
assets
March 2004 131.1 24.2 14.5
December 2003 146.3 24.4 12.0
Financial year to date 414.8 75.2 40.9
Net operating profit
March 2004 250.9 135.1 89.3
December 2003 261.8 132.0 74.8
Financial year to date 729.3 405.8 218.3
Other income/(expenses)
March 2004 98.6 2.8 0.1
December 2003 137.9 1.7 0.3
Financial year to date 301.8 5.9 (0.5)
Profit before taxation
March 2004 349.5 137.9 89.4
December 2003 399.7 133.7 75.1
Financial year to date 1,031.1 411.7 217.8
Mining and income
taxation
March 2004 109.8 56.0 8.6
December 2003 118.1 54.1 7.3
Financial year to date 343.6 166.7 39.9
- Normal taxation
March 2004 35.8 14.6 8.8
December 2003 34.4 14.3 8.0
Financial year to date 103.9 44.1 23.6
- Deferred taxation
March 2004 74.0 41.4 (0.2)
December 2003 83.7 39.8 (0.7)
Financial year to date 239.7 122.6 16.3
Exceptional items
March 2004 - - -
December 2003 1.9 - -
Financial year to date 3.1 - -
Net earnings
March 2004 239.7 81.9 80.8
December 2003 283.5 79.6 67.8
Financial year to date 690.6 245.0 177.9
Capital expenditure
(Rand million)
March 2004 551.2 281.3 0.9
December 2003 334.2 189.1 5.0
Financial year to date 1,132.7 551.4 13.2
Planned for next six 1,548.5 730.7 21.1
months to September
2004
Australia #
St Ives Agnew
Operating Results
Ore milled / treated (000
tons)
March 2004 1,723 291
December 2003 1,845 287
Financial year to date 5,256 888
Yield (grams per ton)
March 2004 2.4 5.6
December 2003 2.4 5.4
Financial year to date 2.4 5.2
Gold produced (kilograms)
March 2004 4,099 1,642
December 2003 4,359 1,558
Financial year to date 12,409 4,628
Gold sold (kilograms)
March 2004 4,099 1,642
December 2003 4,359 1,558
Financial year to date 12,409 4,628
Gold price received (Rand
per kilogram)
March 2004 89,729 89,099
December 2003 84,997 85,366
Financial year to date 87,179 86,971
Total cash costs (Rand per
kilogram)
March 2004 73,725 50,731
December 2003 60,931 45,635
Financial year to date 66,387 51,426
Total production costs (Rand
per kilogram)
March 2004 84,724
December 2003 75,731
Financial year to date 80,689
Operating costs (Rand per
ton)
March 2004 167 258
December 2003 148 221
Financial year to date 154 233
Financial Results (Rand
million)
Revenue
March 2004 367.8 146.3
December 2003 370.5 133.0
Financial year to date 1,081.8 402.5
Operating costs
March 2004 287.4 75.0
December 2003 272.5 63.4
Financial year to date 808.5 207.0
Gold inventory change
March 2004 22.4 10.4
December 2003 (5.7) 8.4
Financial year to date 32.7 32.2
Operating profit
March 2004 58.0 60.9
December 2003 103.7 61.2
Financial year to date 240.6 163.3
Amortisation of mining
assets
March 2004 92.4
December 2003 109.9
Financial year to date 298.7
Net operating profit
March 2004 26.6
December 2003 55.0
Financial year to date 105.3
Other income/(expenses)
March 2004 95.7
December 2003 135.9
Financial year to date 296.4
Profit before taxation
March 2004 122.3
December 2003 190.9
Financial year to date 401.7
Mining and income taxation
March 2004 45.2
December 2003 56.7
Financial year to date 137.0
- Normal taxation
March 2004 12.4
December 2003 12.1
Financial year to date 36.2
- Deferred taxation
March 2004 32.8
December 2003 44.6
Financial year to date 100.8
Exceptional items
March 2004 -
December 2003 1.9
Financial year to date 3.1
Net earnings
March 2004 77.0
December 2003 136.1
Financial year to date 267.8
Capital expenditure (Rand
million)
March 2004 238.9 30.1
December 2003 106.6 33.5
Financial year to date 471.2 96.9
Planned for next six months 697.1 99.6
to September 2004
# 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.
Operating and Financial Results
US DOLLARS SA Operations
Total Mine
Operations Total
Operating Results
Ore milled / treated (000
tons)
March 2004 11,815 4,335
December 2003 11,640 4,232
Financial year to date 34,952 12,800
Yield (ounces per ton)
March 2004 0.093 0.160
December 2003 0.095 0.165
Financial year to date 0.095 0.164
Gold produced (000 ounces)
March 2004 1,095.3 695.2
December 2003 1,107.6 698.1
Financial year to date 3,304.4 2,103.9
Gold sold (000 ounces)
March 2004 1,095.3 695.2
December 2003 1,107.6 698.1
Financial year to date 3,304.4 2,103.9
Gold price received (Dollars
per ounce)
March 2004 407 406
December 2003 390 389
Financial year to date 385 384
Total cash costs (Dollars per
ounce)
March 2004 309 334
December 2003 308 345
Financial year to date 299 328
Total production costs
(Dollars per ounce)
March 2004 349 366
December 2003 348 376
Financial year to date 337 358
Operating costs (Dollars per
ton)
March 2004 29 56
December 2003 30 59
Financial year to date 29 56
Financial Results ($million)
Revenue
March 2004 444.4 281.4
December 2003 430.7 270.9
Financial year to date 1,271.9 807.9
Operating costs
March 2004 345.3 241.6
December 2003 346.7 250.3
Financial year to date 1,006.8 718.5
Gold inventory change
March 2004 3.2 -
December2003 3.6 -
Financial year to date 12.4 -
Operating profit
March 2004 95.9 39.8
December 2003 80.4 20.7
Financial year to date 252.8 89.4
Amortisation of mining assets
March 2004 40.3 21.0
December 2003 41.7 20.3
Financial year to date 119.0 59.8
Net operating profit
March 2004 55.6 18.8
December 2003 38.7 0.4
Financial year to date 133.8 29.6
Other income/(expenses)
March 2004 8.4 (6.1)
December 2003 17.4 (2.5)
Financial year to date 33.1 (10.0)
Profit before taxation
March 2004 64.0 12.7
December 2003 56.1 (2.1)
Financial year to date 167.0 19.7
Mining and income taxation
March 2004 11.5 (4.7)
December 2003 13.8 (3.6)
Financial year to date 32.4 (16.7)
- Normal taxation
March 2004 7.9 2.6
December 2003 5.0 -
Financial year to date 17.6 2.8
- Deferred taxation
March 2004 3.6 (7.3)
December 2003 8.7 (3.6)
Financial year to date 14.8 (19.4)
Exceptional items
March 2004 0.2 0.1
December 2003 1.2 0.9
Financial year to date 26.7 26.2
Net earnings
March 2004 61.7 17.5
December 2003 43.5 2.5
Financial year to date 161.2 62.5
Capital expenditure ($
million)
March 2004 116.7 27.6
December 2003 88.9 38.6
Financial year to date 280.0 106.3
Planned for next six months to 303.8 66.3
September 2004
Driefontein Kloof Beatrix
Operating Results
Ore milled /treated
(000 tons)
March 2004 1,655 1,227 1,453
December 2003 1,558 1,284 1,390
Financial year to date 4,816 3,758 4,226
Yield (ounces per ton)
March 2004 0.175 0.204 0.106
December 2003 0.175 0.206 0.116
Financial year to date 0.177 0.207 0.112
Gold produced (000
ounces)
March 2004 289.6 250.9 154.7
December 2003 272.3 265.1 160.8
Financial year to date 850.9 778.4 474.7
Gold sold (000 ounces)
March 2004 289.6 250.9 154.7
December 2003 272.3 265.1 160.8
Financial year to date 850.9 778.4 474.7
Gold price received
(Dollars per ounce)
March 2004 405 406 409
December 2003 389 392 385
Financial year to date 383 385 384
Total cash costs
(Dollars per ounce)
March 2004 310 348 358
December 2003 336 349 354
Financial year to date 309 338 346
Total production costs
(Dollars per ounce)
March 2004 342 387 379
December 2003 367 387 374
Financial year to date 339 375 366
Operating costs
(Dollars per ton)
March 2004 57 74 39
December 2003 62 75 43
Financial year to date 57 73 40
Financial Results ($
million)
Revenue
March 2004 116.6 101.6 63.1
December 2003 105.8 103.4 61.7
Financial year to date 325.9 299.6 182.5
Operating costs
March 2004 93.7 90.7 57.3
December 2003 95.4 95.9 59.0
Financial year to date 274.5 273.9 170.1
Gold inventory change
March 2004 - - -
December 2003 - - -
Financial year to date - - -
Operating profit
March 2004 23.0 10.9 5.9
December 2003 10.5 7.4 2.7
Financial year to date 51.3 25.7 12.4
Amortisation of mining
assets
March 2004 8.8 9.1 3.1
December 2003 7.9 9.3 3.1
Financial year to date 24.4 26.4 9.0
Net operating profit
March 2004 14.2 1.8 2.8
December 2003 2.6 (1.8) (0.3)
Financial year to date 26.9 (0.7) 3.4
Other income/(expenses)
March 2004 (2.6) (1.8) (1.7)
December 2003 (1.6) (0.2) (0.6)
Financial year to date (5.0) (2.6) (2.4)
Profit before taxation
March 2004 11.5 - 1.1
December 2003 1.0 (2.1) (1.0)
Financial year to date 21.9 (3.3) 1.0
Mining and income
taxation
March 2004 (3.0) 0.4
(2.2)
December 2003 (0.9) (2.3) (0.4)
Financial year to date (9.5) (7.7) 0.6
- Normal taxation
March 2004 0.8 0.9 0.9
December 2003 - - -
Financial year to date 0.9 0.9 1.0
- Deferred taxation
March 2004 (3.8) (3.0) (0.5)
December 2003 (0.9) (2.3) (0.4)
Financial year to date (10.4) (8.6) (0.4)
Exceptional items
March 2004 0.2 (0.1) -
December 2003 1.1 (0.2) -
Financial year to date 26.5 (0.3) -
Net earnings
March 2004 14.8 2.1 0.7
December 2003 2.9 0.1 (0.6)
Financial year to date 57.9 4.2 0.5
Capital expenditure ($
million)
March 2004 5.8 10.4 11.5
December 2003 12.5 13.5 12.6
Financial year to date 30.5 41.1 34.8
Planned for next six 20.9 22.6 22.8
months to September
2004
Average exchange rates are US$1 = R6.79 and US$1 = R6.76 for the March 2004 and
December 2003 quarters respectively.
Figures may not add as they are rounded independently.
Operating and Financial Results
US DOLLARS International
Ghana
Total Tarkwa Damang
Operating Results
Ore milled /treated (000
tons)
March 2004 7,480 4,165 1,301
December 2003 7,408 3,918 1,358
Financial year to date 22,152 12,163 3,845
Yield (ounces per ton)
March 2004 0.053 0.033 0.060
December 2003 0.055 0.036 0.057
Financial year to date 0.054 0.035 0.059
Gold produced (000
ounces)
March 2004 400.1 137.4 78.1
December 2003 409.5 141.8 77.5
Financial year to date 1,200.4 426.9 225.8
Gold sold (000 ounces)
March 2004 400.1 137.4 78.1
December 2003 409.5 141.8 77.5
Financial year to date 1,200.4 426.9 225.8
Gold price received
(Dollars per ounce)
March 2004 409 407 408
December 2003 392 391 396
Financial year to date 387 386 387
Total cash costs (Dollars
per ounce)
March 2004 266 237 219
December 2003 245 227 236
Financial year to date 249 224 228
Total production costs
(Dollars per ounce)
March 2004 317 263 246
December 2003 299 253 260
Financial year to date 300 250 256
Operating costs (Dollars
per ton)
March 2004 14 8 13
December 2003 13 8 12
Financial year to date 13 8 13
Financial Results ($
million)
Revenue
March 2004 163.0 55.9 31.8
December 2003 159.7 55.4 30.4
Financial year to date 464.0 164.6 87.4
Operating costs
March 2004 103.6 33.6 17.0
December 2003 96.4 30.4 16.6
Financial year to date 288.2 93.5 49.6
Gold inventory change
March 2004 3.2 (1.1) (0.4)
December 2003 3.6 1.9 1.2
Financial year to date 12.4 2.4 0.7
Operating profit
March 2004 56.1 23.4 15.2
December 2003 59.8 23.1 12.7
Financial year to date 163.4 68.7 37.0
Amortisation of mining
assets
March 2004 19.3 3.6 2.1
December 2003 21.5 3.6 1.8
Financial year to date 59.3 10.7
Net operating profit
March 2004 36.8 19.8 13.0
December 2003 38.3 19.5 10.9
Financial year to date 104.2 58.0 31.2
Other income/(expenses)
March 2004 14.5 0.4 -
December 2003 19.8 0.2 -
Financial year to date 43.1 0.8 (0.1)
Profit before taxation
March 2004 51.3 20.3 13.0
December 2003 58.1 19.7 10.9
Financial year to date 147.3 58.8 31.1
Mining and income
taxation
March 2004 16.2 8.2 1.3
December 2003 17.4 8.0 1.2
Financial year to date 49.1 23.8 5.7
- Normal taxation
March 2004 5.3 2.1 1.3
December 2003 5.1 2.1 1.2
Financial year to date 14.8 6.3 3.4
- Deferred taxation
March 2004 10.9 6.1 -
December 2003 12.3 5.9 -
Financial year to date 34.2 17.5 2.3
Exceptional items
March 2004 - - -
December 2003 0.3 - -
Financial year to date 0.4 - -
Net earnings
March 2004 44.2 12.0 11.7
December 2003 41.0 11.7 9.7
Financial year to date 98.7 35.0 25.4
Capital expenditure ($
million)
March 2004 89.1 45.3 0.2
December 2003 50.3 28.1 0.8
Financial year to date 173.7 84.6 2.0
Planned for next six 237.5 112.1 3.2
months to September 2004
US DOLLARS
Australia #
St Ives Agnew
Operating Results
Ore milled / treated (000 tons)
March 2004 1,723 291
December 2003 1,845 287
Financial year to 5,256 888
date
Yield (ounces per ton)
March 2004 0.076 0.181
December 2003 0.076 0.175
Financial year to 0.076 0.168
date
Gold produced (000 ounces)
March 2004 131.8 52.8
December 2003 140.1 50.1
Financial year to 399.0 148.8
date
Gold sold (000 ounces)
March 2004 131.8 52.8
December 2003 140.1 50.1
Financial year to 399.0 148.8
date
Gold price received (Dollars per
ounce)
March 2004 411 408
December 2003 391 393
Financial year to 387 387
date
Total cash costs (Dollars per
ounce)
March 2004 338 233
December 2003 280 210
Financial year to 295 229
date
Total production costs (Dollars
per ounce)
March 2004 388
December 2003 348
Financial year to 359
date
Operating costs (Dollars per ton)
March 2004 25 38
December 2003 22 33
Financial year to 22 33
date
Financial Results ($ million)
Revenue
March 2004 54.0 21.4
December 2003 54.4 19.5
Financial year to 154.5 57.5
date
Operating costs
March 2004 42.1 11.0
December 2003 40.0 9.4
Financial year to 115.5 29.6
date
Gold inventory change
March 2004 3.1 1.5
December 2003 (0.7) 1.3
Financial year to 4.7 4.7
date
Operating profit
March 2004 8.7 8.9
December 2003 15.1 8.9
Financial year to 34.4 23.2
date
Amortisation of mining assets
March 2004 13.6
December 2003 16.1
Financial year to 42.7
date
Net operating profit
March 2004 4.0
December 2003 7.9
Financial year to 15.0
date
Other income/(expenses)
March 2004 14.1
December 2003 19.6
Financial year to 42.3
date
Profit before taxation
March 2004 18.0
December 2003 27.5
Financial year to 57.4
date
Mining and income taxation
March 2004 6.6
December 2003 8.2
Financial year to 19.6
date
- Normal taxation
March 2004 1.8
December 2003 1.8
Financial year to 5.2
date
- Deferred taxation
March 2004 4.8
December 2003 6.4
Financial year to 14.4
date
Exceptional items
March 2004 -
December 2003 0.3
Financial year to 0.4
date
Net earnings
March 2004 11.5
December 2003 19.5
Financial year to 38.3
date
Capital expenditure ($ million)
March 2004 38.5 5.1
December 2003 16.4 5.1
Financial year to 72.3 14.9
date
Planned for next six months to 106.9 15.3
September 2004
US DOLLARS Australian
Dollars
Australia #
St Ives Agnew
Operating Results
Ore milled / treated (000
tons)
March 2004 1,723 291
December 2003 1,845 287
Financial year to date 5,256 888
Yield (ounces per ton)
March 2004 0.076 0.181
December 2003 0.076 0.175
Financial year to date 0.076 0.168
Gold produced (000 ounces)
March 2004 131.8 52.8
December 2003 140.1 50.1
Financial year to date 399.0 148.8
Gold sold (000 ounces)
March 2004 131.8 52.8
December 2003 140.1 50.1
Financial year to date 399.0 148.8
Gold price received
(Dollars per ounce)
March 2004 538 534
December 2003 551 553
Financial year to date 546 544
Total cash costs (Dollars
per ounce)
March 2004 442 304
December 2003 395 296
Financial year to date 415 322
Total production costs
(Dollars per ounce)
March 2004 508
December 2003 491
Financial year to date 505
Operating costs (Dollars
per ton)
March 2004 32 50
December 2003 31 46
Financial year to date 31 47
Financial Results ($
million)
Revenue
March 2004 70.8 28.3
December 2003 76.7 27.5
Financial year to date 217.7 81.0
Operating costs
March 2004 55.5 14.5
December 2003 56.4 13.1
Financial year to date 162.7 41.6
Gold inventory change
March 2004 4.5 2.0
December 2003 (1.2) 1.8
Financial year to date 6.6 6.5
Operating profit
March 2004 10.8 11.8
December 2003 21.4 12.6
Financial year to date 48.4 32.9
Amortisation of mining
assets
March 2004 17.7
December 2003 22.7
Financial year to date 60.1
Net operating profit
March 2004 5.0
December 2003 11.3
Financial year to date 21.2
Other income/(expenses)
March 2004 18.3
December 2003 28.0
Financial year to date 59.6
Profit before taxation
March 2004 23.3
December 2003 39.3
Financial year to date 80.8
Mining and income taxation
March 2004 8.7
December 2003 11.7
Financial year to date 27.6
- Normal taxation
March 2004 2.4
December 2003 2.5
Financial year to date 7.3
- Deferred taxation
March 2004 6.3
December 2003 9.2
Financial year to date 20.3
Exceptional items
March 2004 -
December 2003 0.4
Financial year to date 0.6
Net earnings
March 2004 14.6
December 2003 28.0
Financial year to date 53.9
Capital expenditure ($
million)
March 2004 50.1 6.5
December 2003 20.5 6.5
Financial year to date 96.2 19.8
Planned for next six months 142.3 20.3
to September 2004
Average exchange rates are US$1 = R6.79 and US$1 = R6.76 for the March 2004 and
December 2003 quarters respectively. The Australian Dollar exchange rates were
AU$1 = R5.19 and AU$1 = R4.80 for the March 2004 and December 2003 quarters
respectively.
# 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.
Underground and
Surface
SA Rand and Metric
Units
SA OPERATIONS
Operating
Results Total Mine
Operations Total Driefontein
Ore milled / treated
(000 ton)
- underground
March 2004 3,148 2,585 838
December 2003 3,306 2,871 950
Financial year to date 9,889 8,473 2,782
- surface
March 2004 8,667 1,750 817
December 2003 8,334 1,361 608
Financial year to date 25,063 4,327 2,034
- total
March 2004 11,815 4,335 1,655
December 2003 11,640 4,232 1,558
Financial year to date 34,952 12,800 4,816
Yield (grams per
ton) - underground
March 2004 7.2 7.4 8.6
December 2003 6.8 6.9 7.5
Financial year to date 6.9 7.0 8.0
- surface
March 2004 1.3 1.4 2.2
December 2003 1.4 1.4 2.3
Financial year to date 1.4 1.4 2.0
- combined
March 2004 2.9 5.0 5.4
December 2003 3.0 5.1 5.4
Financial year to date 2.9 5.1 5.5
Gold produced
(kilograms) -
underground
March 2004 22,615 19,193 7,191
December 2003 22,529 19,763 7,092
Financial year to date 68,521 59,536 22,299
- surface
March 2004 11,454 2,431 1,817
December 2003 11,922 1,951 1,377
Financial year to date 34,256 5,904 4,166
- total
March 2004 34,069 21,624 9,008
December 2003 34,451 21,714 8,469
Financial year to date 102,777 65,440 26,465
Operating costs
(Rand per ton) -
underground
March 2004 554 597 694
December 2003 539 565 635
Financial year to date 538 565 642
- surface
March 2004 70 57 69
December 2003 69 58 74
Financial year to date 69 56 67
- total
March 2004 199 379 385
December 2003 202 402 416
Financial year to date 202 393 399
Operating Results
Kloof Beatrix Total
Ore milled / treated
(000 ton)
- underground
March 2004 744 1,003 563
December 2003 921 1,000 435
Financial year to date 2,634 3,057 1,416
- surface
March 2004 483 450 6,917
December 2003 363 390 6,973
Financial year to date 1,124 1,169 20,736
- total
March 2004 1,227 1,453 7,480
December 2003 1,284 1,390 7,408
Financial year to date 3,758 4,226 22,152
Yield (grams per ton)
- underground
March 2004 10.0 4.5 6.1
December 2003 8.6 4.7 6.4
Financial year to date 8.8 4.6 6.3
- surface
March 2004 0.7 0.6 1.3
December 2003 0.8 0.7 1.4
Financial year to date 0.8 0.7 1.4
- combined
March 2004 6.4 3.3 1.7
December 2003 6.4 3.6 1.7
Financial year to date 6.4 3.5 1.7
Gold produced
(kilograms)
- underground
March 2004 7,466 4,536 3,422
December 2003 7,958 4,713 2,766
Financial year to date 23,304 13,933 8,985
- surface
March 2004 337 277 9,023
December 2003 286 288 9,971
Financial year to date 906 832 28,352
- total
March 2004 7,803 4,813 12,445
December 2003 8,244 5,001 12,737
Financial year to date 24,210 14,765 37,337
Operating costs (Rand
per ton)
- underground
March 2004 790 374 356
December 2003 685 387 373
Financial year to date 702 376 374
- surface
March 2004 59 32 73
December 2003 56 36 71
Financial year to date 60 36 72
- total
March 2004 502 268 95
December 2003 507 288 88
Financial year to date 510 282 91
INTERNATIONAL
Operating Results Ghana
Tarkwa Damang
Ore milled / treated
(000 ton)
- underground
March 2004 - -
December 2003 - -
Financial year to date - -
- surface
March 2004 4,165 1,301
December 2003 3,918 1,358
Financial year to date 12,163 3,845
- total
March 2004 4,165 1,301
December 2003 3,918 1,358
Financial year to date 12,163 3,845
Yield (grams per ton)
- underground
March 2004 - -
December 2003 - -
Financial year to date - -
- surface
March 2004 1.0 1.9
December 2003 1.1 1.8
Financial year to date 1.1 1.8
- combined
March 2004 1.0 1.9
December 2003 1.1 1.8
Financial year to date 1.1 1.8
Gold produced
(kilograms)
- underground
March 2004 - -
December 2003 - -
Financial year to date - -
- surface
March 2004 4,274 2,430
December 2003 4,409 2,411
Financial year to date 13,278 7,022
- total
March 2004 4,274 2,430
December 2003 4,409 2,411
Financial year to date 13,278 7,022
Operating costs (Rand
per ton)
- underground
March 2004 - -
December 2003 - -
Financial year to date - -
- surface
March 2004 55 89
December 2003 53 83
Financial year to date 54 90
- total
March 2004 55 89
December 2003 53 83
Financial year to date 54 90
Operating Results Australia
St Ives Agnew
Ore milled / treated
(000 ton)
- underground
March 2004 442 121
December 2003 326 109
Financial year to date 1,091 325
- surface
March 2004 1,281 170
December 2003 1,519 178
Financial year to date 4,165 563
- total
March 2004 1,723 291
December 2003 1,845 287
Financial year to date 5,256 888
Yield (grams per ton)
- underground
March 2004 4.6 11.3
December 2003 4.5 11.9
Financial year to date 4.8 11.7
- surface
March 2004 1.6 1.6
December 2003 1.9 1.5
Financial year to date 1.7 1.5
- combined
March 2004 2.4 5.6
December 2003 2.4 5.4
Financial year to date 2.4 5.2
Gold produced
(kilograms)
- underground
March 2004 2,054 1,368
December 2003 1,468 1,298
Financial year to date 5,198 3,787
- surface
March 2004 2,045 274
December 2003 2,891 260
Financial year to date 7,211 841
- total
March 2004 4,099 1,642
December 2003 4,359 1,558
Financial year to date 12,409 4,628
Operating costs (Rand
per ton)
- underground
March 2004 326 465
December 2003 355 428
Financial year to date 346 467
- surface
March 2004 112 111
December 2003 103 94
Financial year to date 103 98
- total
March 2004 167 258
December 2003 148 221
Financial year to date 154 233
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
March 2004
Driefontein quarter
Carbon
Reef Leader Main VCR
Advanced (m) 4,774 958 1,511
Advanced on reef (m) 814 274 171
Sampled (m) 768 303 144
Channel width (cm) 135 34 36
Average value �(g/t) 18.3 14.7 49.7
� (cm.g/t) 2,475 508 1,788
December 2003
quarter
Carbon
Reef Leader Main VCR
Advanced (m) 5,382 970 1,571
Advanced on reef (m) 765 370 285
Sampled (m) 609 276 234
Channel width (cm) 130 57 104
Average value �(g/t) 14.9 8.5 20.8
� (cm.g/t) 1,935 486 2,163
Year to date
F2004
Carbon
Reef Leader Main VCR
Advanced (m) 15,351 3,077 4,654
Advanced on reef (m) 2,434 1,028 587
Sampled (m) 2,277 795 492
Channel width (cm) 128 56 82
Average value �(g/t) 17.3 10.6 27.4
� (cm.g/t) 2,209 587 2,257
Kloof March 2004
quarter
Carbon
Reef Leader Kloof Main VCR
Carbon
Leader
Advanced (m) - 1,533 138 7,374
Advanced on reef (m) - 713 70 1,276
Sampled (m) - 588 54 1,149
Channel width (cm) - 122 89 97
Average value �(g/t) - 20.6 8.7 30.0
� (cm.g/t) - 2,511 768 2,894
December 2003
quarter
Carbon
Reef Kloof Leader Main VCR
Advanced (m) 14 370 1,894 10,268
Advanced on reef (m) 14 193 516 1,664
Sampled (m) 6 150 378 1,086
Channel width (cm) 46 93 78 9
Average value �(g/t) 5.4 15.6 12.5 28.4
� (cm.g/t) 247 1,442 975 2,621
Year to date
F2004
Carbon Kloof Main VCR
Reef Leader
Advanced (m) 14 2,387 3,792 27,327
Advanced on reef (m) 14 1,106 1,095 4,754
Sampled (m) 6 897 891 3,663
Channel width (cm) 246 112 74 88
Average value � (g/t) 5.4 17.3 12.5 29.3
� (cm.g/t) 247 1,936 927 2,588
Beatrix March 2004
quarter
Reef Beatrix Kalkoenkrans
Advanced (m) 7,837 2,207
Advanced on reef (m) 1,296 545
Sampled (m) 1,101 537
Channel width (cm) 82 157
Average value �(g/t) 12.2 14.7
� (cm.g/t) 1,003 2,320
December 2003
quarter
Reef Beatrix Kalkoenkrans
Advanced (m) 8,732 2,797
Advanced on reef (m) 1,850 699
Sampled (m) 1,719 741
Channel width (cm) 68 141
Average value �(g/t) 13.2 21.0
� (cm.g/t) 895 2,972
Year to date
F2004
Reef Beatrix Kalkoenkrans
Advanced (m) 25,801 7,564
Advanced on reef (m) 5,339 1,921
Sampled (m) 5,175 1,929
Channel width (cm) 76 137
Average value �(g/t) 12.9 17.1
� (cm.g/t) 974 2,354
CONTACT DETAILS
CORPORATE OFFICE
Gold Fields Limited London Office
24 St Andrews Road St James' Corporate Services Limited
Parktown 6 St James' Place
Johannesburg London SW1A 1 NP
2193 Tel: +944 207 499-3916
Postnet Suite 252 Fax: +944 207 491-1989
Private Bag x 30500
Houghton 2041
Tel: +27 11 644-2400
Fax: +27 11 484-0626
DIRECTORS
C M T Thompson (Chairman) R L Pennant-Rea *
A J W right (Deputy P J Ryan
Chairman)
I D Cockerill * (Chief Executive T M G Sexwale
Officer)
K Ansah # B R van Rooyen
G J Gerwel C I von Christierson
N J Holland * (Chief Financial Officer)
#
J M McMahon * Canadian * British #USA
G R Parker # #Ghanaian
CORPORATE SECRETARY
C Farrel Postnet Suite 252
24 St Andrews Road Private Bag x 30500
Parktown Houghton 2041
Johannesburg Tel: +27 11 644-2406
2193 Fax: +27 11 484-0626
INVESTOR RELATIONS
Willie Jacobsz
Tel: +27 11 644-2460
Europe & South Africa North America
Nerina Bodasing Cheryl A. Martin
Tel: +27 11 644-2630 Tel: +1 303 796-8683
Fax: +27 11 484-0639 Fax: +1 303 796-8293
E-mail: investors@goldfields.co.za E-mail: camartin@gfexpl.com
TRANSFER OFFICES
Johannesburg London
Computershare Limited Capita Registrars
Ground Floor Bourne House
70 Marshall Street 34 Beckenham Road
Johannesburg, 2001 Beckenham Kent BR3 4TU
P O Box 61051 Tel: +944 208 639-2000
Marshalltown, 2107 Fax: +944 208 658-3430
Tel: 27 11 370-5000
Fax: 27 11 370-5271
AMERICAN DEPOSITARY RECEIPT BANKER
United States United Kingdom
Bank of New York Bank of New York
101 Barclay Street 46 Berkley Street
New York N.Y. 10286 London
USA W1X 6AA
Tel: +91 212 815-5133 Tel: +944 207 322-6341
Fax: +91 212 571-3050 Fax: +944 207 322-6028
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; decreases
in the market price of gold; hazards associated with underground and surface
gold mining; labour disruptions; changes in government regulations,
particularly environmental regulations; changes in exchange rates; currency
devaluations; inflation and other macro-economic factors; 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.
END
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