Link to PDF booklet [PDF-2MB]
Link to Reporting Accountants Assurance Report [PDF-1MB]
Link to Excel spreadsheets  
Link to Presentation [PDF- 5MB]
Corporate information
Link to Administration
Link to Presentation webcast
Certain forward looking statements

This report contains forward-looking statements within the meaning of Section 27A of the U.S. Securities Act of 1933, as amended, or the Securities Act, and Section 21E of the U.S. Securities Exchange Act of 1934, as amended, or the Exchange Act, with respect to Gold Fields' financial condition, results of operations, business strategies, operating efficiencies, competitive position, growth opportunities for existing services, plans and objectives of management, markets for stock and other matters. Such forward-looking statements can be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "plans", "anticipates", "aims", "continues", "expects", "hopes", "may", "will", "would" or "could" or, in each case, their negative or other various or comparable terminology.

These forward-looking statements, including, among others, those relating to the future business prospects, revenues and income of Gold Fields, wherever they may occur in this report, are necessarily estimates reflecting the best judgment of the senior management of Gold Fields and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. As a consequence, these forward-looking statements should be considered in light of various important factors, including those set forth in this report. Important factors that could cause actual results to differ materially from estimates or projections contained in the forward-looking statements include, without limitation: read more

Salient features

million ounces of
Attributable gold production
  Gruyere 89% complete.
First ore through the
crusher in Q1 2019
  AISC and AIC below
original guidance
per ounce
All-in sustaining costs
  Restructuring of
South Deep complete
  Damang life extension
project ahead of plan
per ounce
All-in costs
  Production ahead of revised
guidance (9 November 2018)
and within 4% of
original guidance (excluding Asanko)
  Positive Salares Norte
feasibility complete
Note: *Cash flow from operating activities less net capital expenditure and environmental payments.
JOHANNESBURG. 16 August 2018: Gold Fields Limited (NYSE & JSE: GFI) announced normalised profit from continuing operations of US$27 million for the year ended December 2018 compared with normalised profit of US$154 million for the year ended December 2017.

A final dividend number 89 of 20 SA cents per share (gross) is payable on 18 March 2019, giving a total dividend for the year ended December 2018 of 40 SA cents per share (gross).
Statement by Nick Holland,
Chief Executive Officer of Gold Fields

2018 in review

2018 marked the second year of the reinvestment programme embarked on by Gold Fields at the end of 2016. The key driver of the reinvestment plan was to ensure that our portfolio of mines continues to generate cash sustainably into the foreseeable future, by lowering group all-in costs and extending the average mine life.

Continue reading...

Having spent total project capital of US$502m over the past two years, primarily on Damang and Gruyere, Gold Fields is now on track to ensure that our international operations will be producing over 2Moz a year for the next decade. This milestone is expected to be reached for the first time in 2019 as Damang grows production; Gruyere commences production and our Asanko JV contributes for the full year. Gold Fields is expected to increase production by 4% to 7% in 2019.

The longer-term future of the Group also looks positive as we continue to invest in near-mine exploration at our Australian mines, which yet again enabled us to put back into reserves what was depleted last year and add beyond that. A positive feasibility study for the Salares Norte project has been completed and a maiden reserve of 3.5Moz has been declared.

While South Deep had a difficult year, the large scale restructuring completed at the end of 2018, places the mine on an improved footing from which to gradually build-up production, having removed over R800m out of our cost base and R400m of capital expenditure with a significantly reduced footprint.

During 2018, we have seen a continued improvement in our health and safety performance as stringent safety culture and standards become entrenched at our operations and projects. Gold Fields' Total Recordable Injury Frequency Rate (TRIFR) fell below two recordable injuries per million hours worked for the first time in 2018, a 24% YoY improvement and the lowest level ever recorded for the Group. However, we still recorded one fatality last year (three in 2017), which served as a tragic reminder that we have lots more work to do to eliminate all fatalities and further reduce injuries.

Attributable gold equivalent production for 2018 was 2.04Moz (FY17: 2.16Moz), exceeding revised guidance of 2.00Moz.

All-in sustaining costs (AISC) and all-in costs (AIC) were US$981/oz (FY17: US$955/oz) and US$1,173/oz (FY17: US$1,088/oz), respectively, both below the lower end of the guidance range provided in February 2018 – AISC: US$990-1,010/oz and AIC: US$1,190-1,210/oz. All operations, apart from South Deep, exceeded guidance for the year, once again highlighting the quality of the portfolio, with these operations being higher on production and lower on costs.

Headline earnings for 2018 were US$61m or US$0.07 per share (2017: US$210m or US$0.26 per share). Net loss for the year was US$348m or US$0.42 per share (2017: US$19m or US$0.02 per share). Normalised profit for the year was US$27m or US$0.03 per share (2017: US$154m or US$0.19 per share).

In line with our dividend policy of paying out 25% to 35% of net earnings as dividends, we declared a final dividend of 20 SA cents per share. This takes the total dividend for the year to 40 SA cents per share (FY 2017: 90 SA cents per share).

As expected, 2018 was another higher capital expenditure year, with a total of US$814m spent in the year given that 2018 was the peak year of capital spend on new projects. As a result, the net cash outflow for the year was US$132m, compared to US$2m in 2017. Mine cash flow for the year, which excludes project capital, was US$334m, compared to US$441m in 2017.

Largely on the back of the net cash outflow for the year and the US$165m payment for the acquisition of the 45% in Asanko Gold Mine, the net debt at 31 December 2018 increased to US$1,612m, compared to US$1,303m at the end of FY 2017. This implies a net debt to adjusted EBITDA of 1.45x, compared to 1.03x at the end of December 2017 and well within our covenant of 2.5x. This increase was anticipated, given the significant spend on projects in 2018, however, we expect the net debt to adjusted EBITDA ratio to reduce in 2019.

Despite the heavy capital expenditure over the past two years, Gold Fields balance sheet remains in a comfortable position. As the group continuously reviews its funding and maturity profile, it is considering opportunities to access the US$ international bond markets primarily to refinance its debt facilities – including potentially the US$1bn 4.875% 144A/RegS bond maturing in October 2020.

Update on the projects

Damang Reinvestment project

The reinvestment project, which commenced on 23 December 2016, continued to track well against plan during 2018. Total tonnes mined were 45.9Mt (2017: 39.7Mt) in 2018 vs. the project schedule of 41.5Mt, driven by a good performance by both of the contractors (BCM and E&P). Gold produced of 180.8koz (2017: 143.6koz) was 13% higher than guidance of 160.0koz, underpinned by high-grade material from the Amoanda pit, while AIC of US$1,506/oz (2017: US$1,827/oz) was below guidance of US$1,520/oz. Project capital of US$125m was spent during 2018, on top of the US$115m spent during 2017.

The project is on track to begin sourcing higher-grade ore from the Saddle area of the DPCB early in 2019 and then reach the reef horizon of the main pit in early 2020. The Amoanda pit has been the main ore source during the cutback of the main Damang pit, with positive grade reconciliation from Amoanda being a key driver to the outperformance of the project over the past 24 months.

The Far East Tailings Storage Facility (FETSF), which will provide cost effective life of mine tailings capacity of 44Mt, was commissioned during Q4 2017, on time and within budget. Decommissioning of the East Tailings Storage Facility (ETSF) commenced during Q1 2018, and was completed during 2018, with all tailings now being deposited on the FETSF.


During 2018, the JV partners announced a slight delay to project completion and an increase in the final forecast capital (FFC) cost estimate. First gold is now expected to be poured during the June 2019 quarter (previously the March 2019 quarter) whilst the FCC estimate is A$621m, a 17% increase from the previous FCC estimate of A$532m.

As at end-December 2018, engineering was largely complete, whilst construction progress was 86.7% vs. budget of 86.4%, with all major equipment and materials for effective construction already delivered to site. During 2018, civil works on the tailings storage facility and installation of the tailings decant recovery pipelines were completed and the power station was fully commissioned. All civil and concrete works for the process plant were completed by year-end, with structural steel, plate steel and tankage nearing completion. Post year-end, the remaining work focused on piping, electrical and instrumentation and delivery of plant systems for commissioning of the plant which is expected during Q2 2019.

Mining contractor, Downer EDI, began mobilising their workforce during Q1 2018 to begin construction of the mining infrastructure. Mining activities commenced in November 2018, focusing on completing the pre-strip and second stage ROM pad development. First ore was mined and crushed post year-end.

During 2018, A$306m (US$230m) (100% basis) was spent on the project, bringing the cumulative costs incurred as at end-December 2018 to A$492m (US$374m). The remaining project capital of A$129m (US$97m) (100% basis) has been budgeted for 2019, the majority of which will be spent during the first half of the year.

First gold is forecast for Q2 2019 with production of 59koz (Gold Fields 50% share) forecast for the year. A relatively quick ramp up is anticipated, with steady state run rate expected by year-end.

Salares Norte

The feasibility study for the project was completed and peer reviewed during 2018. The key elements of the feasibility study include:

Initial 11.5-year life of mine
Annual throughput of 2mt
Life of mine production of 4.0Moz gold equivalent which will be front-end loaded
Annual production of 355koz gold equivalent over life of mine (annual production of 450koz for first 7 years)
AISC of US$545 per gold equivalent ounce (AISC of US$465/oz for first 7 years)
Project capital of US$850m (+/-5%)
IRR of 25% at US$1,300/oz gold price with a 2.2 year payback period, from commencement of first productio
NPV is US$654m (discount rate 7.5%) from full notice to proceed
Strip ratio 13.9 (including pre-strip) and 11.7 (excluding pre-strip)

In December 2018, Gold Fields updated the project's Mineral Resources and Reserves, reporting a total Mineral Resource of 25.6Mt of gold at a grade of 4.76g/t to give 3.9Moz, and 43.7Moz of silver at an average grade of 53.1g/t. More pertinently, a maiden Reserve has been declared with 3.5Moz of gold (21.1Mt at 5.1g/t) and 39.3Moz of silver at 57.9g/t.

The project envisages open pit operations with a processing plant that includes both CIP and Merrill Crowe processes, due to the high silver content. In addition, given the scarcity of water in the area, dry stack tailings are expected to be used.

The Environmental Impact Assessment (EIA) was accepted for review on 11 July 2018. Gold Fields anticipates the EIA review to take 18 – 24 months to complete. Given the declaration of the maiden reserve together with the positive results of the feasibility study, management is confident that the project will be developed. However there is sufficient time to consider funding options and whether or not to bring in a partner to develop the asset.

Regional performance in FY 2018


Gold Fields’ Australian operations delivered another strong operational performance in 2018. Gold production at 886koz was better than full year guidance of 865koz, with Granny Smith, St Ives and Agnew all outperforming both production and cost guidance. Production was 5% lower than in 2017 (935koz), which included three quarters of production from Darlot. AIC for the region was 4% higher YoY at A$1,262/oz (FY17: A$1,210/oz) but marginally higher in US$ terms at US$926/oz (FY17: US$948/oz). The region had another strong year of cash generation, with net cash inflow of US$194m (FY17: US$189m), excluding Gruyere capital.

In an important development for Agnew, Gold Fields made the decision to invest in a new camp (we previously rented rooms from BHP Billiton in Leinster 26 km away from site) and hybrid power station on site. The first buildings for the camp arrived on 15 December 2018 and construction commenced in January 2019. Commissioning of 450 rooms and the central facilities is targeted for May 2019. The new power station will entail a combination of gas, solar and wind power generation. Commissioning of the gas and solar components is scheduled for June 2019, with wind generation to follow in Q1 2020.

West Africa

Attributable gold production from the West Africa region, which includes Asanko Gold Mine’s (AGM) contribution from 1 August 2018, increased 6% to 680koz (FY17: 639koz). Excluding the AGM contribution, attributable production would have decreased by 1% to 635koz, however this was 4% ahead of guidance for the year. Damang materially outperformed guidance of 160koz, producing 181koz due to continued outperformance from the Amoanda pit. AIC for the region decreased by 2% to US$1,098/oz (FY17: US$1,119/oz), and beat guidance of US$1,100/oz. The good cost performance was mainly due to lower net operating costs and lower sustaining capital expenditure, partially offset by lower gold sold and higher project capital at Damang. Despite the increase in project capital at Damang (US$125m in FY18 vs. US$115m in FY17), the region generated net cash flow of US$24m (FY17: US$64m).

During the year, Tarkwa transitioned from owner mining to contractor mining in an attempt to address cost inflation in the region. The mining contract was demarcated into two zones and awarded to two local contractors: BCM for Zone 1 (Pepe, Mantraim, Atuabo and Teberebe Pits) and E&P for Zone 2 (Akontansi and Kottraverchy Pits). BCM mobilised and started operations in Zone 1 on 24 March 2018, with E&P following in the Zone 2 area on 7 April 2018. As part of the tender process, the contractors undertook to purchase all fleet from Gold Fields, which largely covered the retrenchment costs incurred through the process.

South America

Cerro Corona in Peru had another solid year in 2018, with attributable gold-equivalent production of 313koz (2017: 305koz). This was 12% higher than the gold-equivalent production guidance for the year of 280koz, underpinned by the higher copper price ratio and higher copper production due to a higher copper head grade as a result of higher grade areas mined. AISC and AIC were US$282/oz in 2018 compared to US$203/oz in 2017 and, on a gold equivalent basis, US$699/oz in 2018 (2017: US$673/oz). The increase in AISC and AIC was primarily due to lower by-product credits, lower gold sold and higher cost of sales before amortisation and depreciation. Both AISC and AIC comfortably beat guidance for the year of US$585/oz and, on a gold equivalent basis US$810/oz. On the back of the strong operating performance, Cerro Corona generated net cash flow of US$114m (FY17: US$117m).

South Africa

South Deep got off to a tough start in 2018, with production in Q1 2018 impacted by a slow build up after the seasonal holidays, two labour restructuring processes that took place at the end of 2017 and during Q1 2018, and a change in the underground working shift arrangements implemented in an attempt to increase productivity. In addition, low mobile equipment reliability, the intersection of active geological features (faults and dykes) in the high-grade corridor 3 and poor ground conditions in the even higher grade composites (far western part of the orebody) slowed production rates. Production was further impacted by a 22-day DMR related safety stoppage during April 2018. As a result of these factors, guidance for the mine was downgraded to 7,600kg (244koz) with the release of our Q1 2018 production update on 25 April 2018, from the original guidance of 10,000kg (321koz).

Despite the two restructuring processes, South Deep continued to face a number of organisational and structural challenges that directly affected performance during Q2 2018, with production during the quarter only marginally higher than Q1 2018 at 1,518kg (49koz). As a result, on 14 August 2018, Gold Fields announced a material restructuring of the mine, to right-size the cost base to match existing levels of output.

As part of the restructuring, Gold Fields served a Section 189 notice to its trade unions (the NUM and UASA) on 14 August 2018. The consultation period ended on 31 October 2018 and Gold Fields formally served the NUM and UASA with a list of employees that were to be given notice of termination as per the Section 189 process. The majority union (NUM) embarked on a strike on 2 November 2018 which lasted six weeks. The NUM eventually suspended the strike on 18 December 2018 and signed a settlement agreement. Through the restructuring, a total of 1,092 permanent employees exited the business, of which 904 were retrenched, 183 opted for voluntary separation packages and five resigned. Gold Fields also reduced its underground fleet through the restructuring, with the aim of decongesting the working areas. In this regard, the number of Cat 1 machines was reduced by 33% from 98 to 66 (drill rigs, loaders and trucks).

Given the slow start to the year together with the impacts of the strike with very little production in Q4 2018, South Deep’s production decreased 44% YoY to 4,885kg (157koz) and was 36% below revised guidance of 7,600kg (244koz). AIC of R854,049/kg were also significantly higher than expected (guidance: R540,000/kg) underpinned by the significantly lower amount of gold sold during the year. The mine recorded a net cash outflow of R1,891m (US$141m) which includes R148m in retrenchment payments.

In the wake of the restructuring, which has seen our employee workforce fall by 38% from 3,983 to 2,460 and the number of contractors from 2,294 to 1,725, we are in a position to significantly reduce South Deep's pre-restructuring cash-burn during 2019. We expect to build-up gradually to a sustainable production profile from this restructured position. The key enablers for sustainable improvements at South Deep are:

Accelerate backfill placement
More robust and timely ground support
Improved drill and blast to improve stope design and reduce underbreak and overbreak
Improved fleet availability and utilisation
Flatter organisational structure
Rigorous performance management linked to line of sight performance
Improved stakeholder management, including government, unions and surrounding communities.

Asanko JV

In March 2018, Gold Fields entered into an agreement to form a 50:50 incorporated joint venture (JV) with Asanko Gold. In the deal which went unconditional on 31 July 2018, Gold Fields acquired a 50% stake in Asanko Gold Ghana’s 90% interest in the Asanko Gold Mine (AGM), associated properties and exploration rights in Ghana. While Asanko remains operators of the asset, a JV committee has been established in which Gold Fields actively contributes from a geotechnical, modelling and planning perspective.

The purchase consideration included an upfront payment of US$165m and a deferred payment of US$20m payable on the earlier of an agreed Esaase development milestone or 31 December 2019. In addition, Gold Fields purchased 9.9% of Asanko Gold’s issued equity through a private placement for a total consideration on US$17.6m.

During 2018, AGM produced 223koz (100% basis) at an AISC of US$1,069/oz and AIC of US$1,175/oz. Guidance for 2019 is 225,000oz to 245,000oz (100% basis) at AISC of US$1,040/oz to US$1,060/oz and AIC of US$1,090/oz to US$1,110/oz. Included in the guidance is first production from oxide material from the Esaase deposit which will be trucked to the processing plant.

Mineral Reserves

Gold Fields has increased its focus on growing its Reserve base outside of South Africa. During 2018, there were some significant developments in this regard, including:

A maiden gold equivalent reserve of 4.0Moz was declared at Salares Norte in Chile
There was a 0.3Moz (4% YoY) increase in the Australian region's reserves, net of depletion. Notably, this includes an 11% YoY increase in St Ives' reserves net of depletion
There was a net decrease of 4.6Moz at South Deep due to geotechnical re-design, adjusted loss factors and an increased cut-off grade

As at end-2018, 20.5Moz of Gold Fields' Reserves (excluding Gold Fields' 45% interest in the Asanko Gold Mine) were outside South Africa, representing 41% of the Group's Reserve base.

Managed   Attributable  
December 2018          
Gold equivalent resources Moz 140.5   108.2  
Gold equivalent reserves Moz 54.0   50.3  
December 2017          
Gold equivalent resources Moz 148.6   115.6  
Gold equivalent reserves Moz 54.9   50.8  
Metal prices used for equivalent ounces:
Gold US$1,200/oz
Copper US$2.8/lb
Silver US$17.50/oz
The metallurgical recovery rate has not been applied to the conversion

Eskom power crisis

We note that Eskom is in a crisis, placing the whole country at risk. While there is no silver bullet, we want security of supply restored, especially for the mining industry. South Deep is currently operating below capacity, which does provide the mine with some flexibility on power usage. We have short, medium and long-term strategies in place to mitigate the risk, including, scheduling of activities, additional off-grid power and longer term renewables. We continue to engage through industrial associations to provide assistance where possible.

2019 outlook and guidance

2019 is set to be an important year for Gold Fields, with the Damang project approaching completion and Gruyere commencing production. In addition, Asanko will contribute for a full year for the first time since acquisition. This will allow the Group to increase production by 4 – 7% in 2019. This also means that our capital expenditure will fall quite aggressively through 2019 and the amount of project capex reduces. The year will however, be one of two halves, with both production and cash flow being weighted to 2H 2019.

For 2019, Gold Fields has undertaken certain gold price hedging, in order to secure short-term cash flow and protect the balance sheet from the volatility of the gold price as we complete our investment phase and ramp up the projects.

Attributable equivalent gold production for the Group for 2019 is expected to be between 2.13Moz and 2.18Moz. AISC is expected to be between US$980/oz and US$995/oz. AIC is planned to be between US$1,075/oz and US$1,095/oz. These expectations assume exchange rates of R/US$:13.80 and A$/US$:0.75.

Production for South Deep is expected to be 6,000kg (193koz), with AIC of R610,000/kg (US$1,372/oz).

Capital expenditure for the Group is planned at US$633m. Sustaining capital expenditure for the Group is planned at US$490m and growth capital expenditure is planned at US$143m. The US$143m growth capital expenditure comprises US$69m for Damang and A$99m (US$74m) for Gruyere. Expenditure on Salares Norte is expected to be US$57m in 2019. The capital expenditure above excludes the Group’s share of Asanko’s total capital expenditure of US$25m for 2019.

N.J. Holland
Chief Executive Officer
15 February 2019

Back to top
Number of shares in issue     NYSE – (GFI)      
– at 31 December 2018   821,532,707     Range – Year   US$2.43 – US$3.56  
– average for the year   821,532,707     Average Volume – year   4,519,927 shares/day  
Free Float   100 per cent     JSE LIMITED – (GFI)      
ADR Ratio   1:1     Range – Year   ZAR32.90 – ZAR56.49  
Bloomberg/Reuters   GFISJ/GFLJ.J     Average Volume – year   2,263,467 shares/day