Operational update for the quarter ended 31 March 2024
Gold Fields Limited
(Incorporated in the Republic of South Africa)
(Registration Number 1968/004880/06)
JSE, NYSE, DIFX Share Code: GFI
ISIN: ZAE000018123
("Gold Fields" or "the Company")
OPERATIONAL UPDATE FOR THE QUARTER ENDED 31 MARCH 2024
SALIENT FEATURES
- 464,000 ounces of attributable production
- US$1,738 per ounce of all-in sustaining cost
- US$2,115 per ounce of all-in cost
JOHANNESBURG, 07 May 2024: Gold Fields Limited (JSE and NYSE: GFI) is pleased to provide an operational
update for the quarter ended 31 March 2024.
Detailed financial and operational results are provided on a six-monthly basis i.e. at the end of
June and December.
Statement by Mike Fraser, CEO:
At the start of the year, as part of our reviewed results announcement for FY 2023, I highlighted the
following five key priorities for our business for 2024 in line with the three pillars of our strategy:
- Ensuring the physical and psychological safety of our people;
- Safe delivery against our production and cost targets;
- Delivery of the Salares Norte ramp up;
- Continuing to improve the value and quality of our portfolio; and
- Continuing progress towards meeting our 2030 ESG targets.
Below I discuss our progress on these for the first quarter of the year (Q1 2024).
Ensuring the physical and psychological safety of our people
The safety and health of our people is our most important value, and we are committed to ensuring that
all our people go home safe and well every day. We have fallen far short of this commitment, and it is
with profound sadness that we report two fatalities at our operations this year. On 2 January 2024, a
trackless engineering supervisor was fatally injured in an incident involving trackless mining equipment
underground at our South Deep mine in South Africa. A second fatal incident occurred at our St Ives mine
in Australia on 23 April 2024, when a colleague employed by a contractor, was fatally injured in a mobile
equipment related incident at a construction site on the mine. We extend our sincere condolences to the
family, friends and colleagues of our two deceased colleagues.
These tragic incidents are deeply concerning for us, as we strongly believe that a fatality-free mining
business is possible. We have initiated an independent review (being conducted by DSS+, formerly Du Pont)
of our Group's safety culture, processes, systems and practices. The review, which commenced in
February 2024, is expected to be completed in the first half of 2024, and will identify opportunities to
accelerate our safety journey and standardise the safety approach across our business. Each one of our
23,000 employees and contractors is a safety leader, and we are working with our teams across the business
to ensure we have the right safety culture and systems in place to ensure the safety of everyone at
Gold Fields.
We also recorded one serious injury in Q1 2024 and our Total Recordable Injury Frequency Rate (TRIFR) for
the quarter was 3.36 per million hours worked (FY 2023: 2.36 per million hours worked).
Our commitment to safety extends to psychological health and wellbeing, which is key to building safe
workplaces. We are continuing to progress the implementation of the 21 recommendations of the
Elizabeth Broderick and Co independent review and will conduct a follow-up review in 2026.
Safe delivery against our production and cost targets
Production for the quarter was severely impacted by weather-related events and operational challenges
particularly at the Gruyere, St Ives, South Deep and Cerro Corona mines resulting in group attributable
equivalent gold production (excluding Asanko) for the quarter being 18% lower year on year (YoY) and
22% lower quarter on quarter (QoQ) to 464koz (Q1 2023: 563koz and Q4 2023: 594koz). The production
performance for each of these operations was as follows.
Gruyere
Gruyere attributable gold production at 32.2koz was 22% lower YoY (Q1 2023: 41.3koz) and 14% lower
QoQ (Q4 2023: 37.3koz) and was negatively impacted by a significant rainfall event in March 2024, which
resulted in the damage and closure of the roads that provide primary access to the mine. The roads were
closed from 5 March, limiting deliveries of diesel and consumables to the mine, and consequently mining
activity and ore processing temporarily ceased. During this time, the mine proactively brought forward
planned plant maintenance. In mid-April, the mine was able to receive fuel and consumables, which were
delivered utilising alternative routes via South Australia and the Northern Territory where roads had
dried sufficiently to allow access. Mining recommenced on 12 April 2024 and plant processing on
14 April 2024. The primary access road to Gruyere was re-opened on 30 April 2024. Ramp up of mining and
plant processing to normalised levels were achieved by 21 April 2024.
To mitigate the impact that material weather events can have on production, we will be increasing stock
holding of diesel and reagents on a seasonal basis. We are also investigating the establishment and
formalisation of an alternative logistics route and network from the east side of the mine. Annual gold
production guidance for Gruyere remains unchanged at 150.0koz - 167.5koz with the mine expected to
make up the production lost in the quarter in the second half of 2024.
St Ives
Gold production at St Ives at 68.9koz was 26% lower YoY (Q1 2023: 92.7koz) and 37% lower QoQ
(Q4 2023: 109.4koz) and was negatively impacted by a decrease in ore mined (following the change in bulk
stopes at Invincible as planned) and lower grades. Ore mined from the underground mine reduced to 407kt
in the quarter compared to 449kt in Q1 2023 and 570kt in Q4 2023 while the underground grade was 14% lower
YoY and 16% lower QoQ. In addition, there was no open pit ore mining at St Ives in Q1 2024 as mining moved
to pre-stripping the Invincible Footwall South and Swiftsure open pits, which are expected to commence
production of ore during the September 2024 quarter. Gold production for the year is therefore expected to
be back-ended to the latter part of the year to achieve the mine's annual guidance of 355koz, which remains
unchanged.
South Deep
The South Deep mine has had a challenging quarter with operational momentum impacted by the fatal incident
on 2 January 2024 (as discussed above), compounded by reduced stope access owing to increased backfill
rehandling and slow drilling through crushed ground resulting in slower stope turnaround in current destress
cuts. Gold production for the quarter was 34% lower YoY and 32% lower QoQ at 56.3koz (1,750kg). Backfill
rehandling is currently presenting the most impactful challenge to production. The mine has developed a
recovery plan to address this. The recovery plan is being closely monitored and includes immediate and
medium-term actions to:
- increase backfill tipping points and address backfill rehandling and backfill leakages;
- increase long hole stope drilling capacity and operator competence to allow effective drilling of
stopes and through crushed ground; and
- improve ventilation, road conditions and service utilities underground.
South Deep's attributable gold equivalent production for 2024 is therefore expected to be in the range of
9,500kg - 9,700kg, in line with gold mined in 2023 (which was 9,600kg). The mine's AISC for 2024 is expected
to be higher than initial guidance at US$1,590/oz ? US$1,625/oz mainly as a result of the lower production volumes.
With its significant resource endowment and long life, the focus for South Deep is currently on setting the
mine up for longevity, quality ounces and incremental and sustainable production increases.
Cerro Corona
Attributable gold equivalent production at Cerro Corona at 41.8koz was 44% lower YoY (Q1 2023: 74.7koz) and
19% lower QoQ (Q4 2023: 51.9koz) impacted by lower gold and copper grades processed and lower metallurgical
recoveries, in line with the long-term mining plan. In addition, inclement weather during the quarter affected
the stability of the north wall of the pit, resulting in a resequencing of mining to lower- grade areas. The
stability of the North wall has been addressed and mining operations have resumed.
Cerro Corona mine is expected to continue mining until 2025 and thereafter will process stockpiles for five years.
We continue to manage the future of the mine in a way that will deliver value for Gold Fields in a responsible
manner, whilst balancing the interests of our stakeholders.
Group
Attributable gold equivalent production and costs
Q1 2024 Q1 2023 Q4 2023 QoQ change YoY change
Australia 216.0 242.8 308.1 (30)% (11)%
South Africa 56.3 84.8 82.8 (32)% (34)%
Ghana 149.7 160.4 150.5 (1)% (7)%
Peru 41.8 74.7 51.9 (19)% (44)%
Lower gold production in the quarter has contributed to a material increase in all-in-sustaining costs (AISC)
and all-in costs (AIC) across all our business. Group AISC for continuing operations was US$1,738/oz, 51%
higher YoY and 28% higher QoQ while group AIC was 58% higher YoY and 31% higher QoQ to US$2,115/oz for the
quarter. The group AIC includes costs for Salares Norte (US$319/oz), Windfall (US$46/oz) and Corporate (US$17/oz).
Salares Norte AIC included costs for the project but marginal gold equivalent production for the quarter as first
gold was delivered on 28 March 2024. Group AIC for the mining operations (excluding Salares Norte, Windfall and
Corporate) were US$1,733/oz (Q1 2023: US$1,142/oz and Q4 2023: US$1,321/oz).
Returning production to normalised levels at the operations affected by weather-related and operational challenges
is key in the short-term to addressing the material cost increases experienced in the quarter. To address this
our current Asset Optimisation programme includes a focus on delivering the 2024 operating plan and proactively
identifying medium to longer term opportunities across the business. This involves completing detailed asset
diagnostics to assess current performance, outlining potential opportunities, defining improvement initiatives
based on constraints and key levers, establishing project charters and developing execution plans with senior
asset leaders to deliver and embed priority projects. These initiatives represent operating effectiveness, volume,
work quality and elimination of wastage that contribute to improving the AISC. These will be crucial for the
long-term sustainability of our operations to offset the risk of margin erosion through persistent inflation.
In addition, unit costs and global cost curve position are key considerations for assessing reserve replacement,
growth and disposal opportunities as we manage our portfolio to improve the quality and value of the ounces that
we produce. An example is the Salares Norte project which with a life of mine AIC of US$820/eq oz (Real 2024$)
is expected to markedly improve the group's AIC.
Delivery of the Salares Norte ramp up
On 28 March 2024 the Salares Norte project commenced production delivering first gold, a significant milestone
for the project that Gold Fields has taken from discovery, through resource and reserve development and project
development into production over a 13 year journey.
Circuit A and Circuit B of the processing plant, which collectively account for 85% of the annual gold equivalent
production, are being commissioned with operational control being handed over to the operational teams. Focus now
is on ramp up of the project which is progressing, albeit slower than anticipated due to the impacts of recent early
winter weather events. Gold equivalent production for 2024 is now expected to be between 220koz and 240koz at an
AIC of US$1,840/eq oz ? US$2,010/eq oz.
Average gold equivalent production for the first five full years of mine life (2025 - 2029) is expected to be
485koz per annum at an AIC of US$790/eq oz (in real 2024$ terms), while gold equivalent ounces produced over the
life of mine (2025 - 2033) is expected to be 360koz per annum at an AIC of US$820/eq oz (in real 2024$ terms).
The total project capital cost remains in line with the guidance at US$1,180m - US$1,200m.
Salares Norte is expected to have one of the industry's lower cost profiles and a payback period of less than three
years at current gold prices contributing meaningfully to our future cash flows, particularly over the next 3 to 4
years. We are undertaking extensive exploration drilling to identify further opportunities to extend the Salares Norte
life of mine and expect to spend approximately US$23m on exploration drilling and greenfields opportunities in the area
during 2024.
Continuing to improve the value and quality of our portfolio
Update on Tarkwa/Iduapriem Joint Venture
In March 2023 we announced the proposed joint venture between our Tarkwa mine and AngloGold Ashanti's neighbouring
Iduapriem mine in Ghana, that has the potential to create Africa's largest gold mine. In addition to leveraging
operating efficiencies to unlock higher grades and enabling an extension of life to at least 18 years, the joint
venture creates compelling shared value for all stakeholders.
Since the announcement, AngloGold Ashanti and ourselves have been in ongoing engagement with the Government of Ghana
with respect to the proposed transaction. While significant progress has been made agreement has not yet been reached.
We will continue to keep the market updated on any developments in this regard.
Update on Windfall project
The Windfall Project in Qu?bec, Canada, which is a 50:50 JV with Canada's Osisko Mining, is a unique growth opportunity
for Gold Fields to partner with Osisko mining to develop a world-class orebody in a sought after, Tier 1 mining
jurisdiction. The project's environmental impact assessment (EIA) was submitted to the regulator in December 2023 with
a decision expected by late 2024/early 2025. Once the EIA is approved, construction of the mine will commence, and
Gold Fields will settle the C$300m balance of the acquisition price.
As part of the partnership, Gold Fields has also acquired a 50% interest in Osisko's highly prospective Urban Barry and
Qu?villon district exploration tenements, which total approximately 2,400km2. These will be co-explored and
co-developed with Osisko, with Gold Fields funding the first C$75m in regional exploration for the first seven years of
the partnership, after which time exploration spend will be shared on a 50:50 basis.
Continuing progress towards meeting our 2030 ESG targets
During Q1 2024, we made further progress in our journey to achieving the 2030 targets for our six priority ESG areas
with a key focus on safety with the appointment of DSS+ as detailed above. Our consistent investments in renewable
electricity projects over the past four years are paying dividends in the form of greater energy supply security,
reduced energy costs and, of course, a reduction in our carbon emissions. We have made further progress in the year
to date.
In February 2024, our Board approved the renewable power project at St Ives at a total cost of approximately
A$296m (US$195m) with construction commencing in early May. The renewables hub will be the largest in the Group's
portfolio and is expected to provide 73% of St Ives' energy requirements and deliver a material reduction in the cost
of energy for the mine once operational toward the end of 2025. It is set to help reduce the mine's Scope 1 and 2
emissions by an estimated 50% in 2030 against the 2016 baseline, while increasing the renewables component in the
Group electricity mix to 24% from 17% at the end of 2023. In April, we also announced the expansion of our Granny Smith
solar plant from 8MW to 19MW, with construction set to commence in June 2024.
Among other ESG highlights, our female representation was at 25% at year-end (FY 2022: 23%), over 50% of which are
women in core mining roles. We distributed US$3.8bn in value to national economies. Of this, US$1bn - 33% of the
total - was shared with our host communities through employment and procurement, as well as SED investments. These
achievements and other ESG highlights and challenges are discussed in detail in our 2023 Integrated Annual Report (IAR)
suite of reports which was published at the end of March 2024.
Financial performance
Net debt at the end of the quarter was US$1,143m, compared to US$1,024m at 31 December 2023. The balance sheet remains
strong, with net debt to EBITDA at the end of the quarter of 0.51x, compared to 0.42x at 31 December 2023. Gold Fields'
US$500m current outstanding bond becomes redeemable on 15 May 2024. The bond will be redeemed using a portion of the
group's US$1.2bn group revolving credit facility.
Update on change to our operating model and executive leadership team
The process to transition our operating model from a three-layered organisation (group, region, asset) to a two-layer
global functional guidance model (group, assets) is progressing well. The new operating model will provide stronger
functional leadership, guidance and support to the assets who, in turn, will be responsible for ensuring safe, reliable
and cost-effective production. This structure will also provide more agility as the portfolio evolves. With the
regional layer removed, the group's Australian and African operations will report into Martin Preece, who has been
appointed as the Chief Operating Officer (COO). Stuart Mathews, who was previously EVP Australia, retired from
Gold Fields, and Joshua Mortoti who was previously EVP: Ghana left the company. Both EVP roles will not be replaced
as we transition to the new operating model. The Cerro Corona and Salares Norte mines in South America will continue
to report to the EVP South America.
As previously indicated Paul Schmidt, has retired as CFO and as a Board member effective from 1 May 2024. The search
for a new CFO is in final stages and we expect to make an announcement over the next few months. Until the new CFO is
appointed, Alex Dall, the VP Corporate Finance, will act as CFO.
Mariette Steyn has been appointed to replace Naseem Chohan as EVP Sustainable Development from 1 June onwards.
Naseem will be going on retirement this year and will work with Mariette to ensure a smooth transition.
2024 production and cost guidance unchanged
Despite the challenges experienced in the quarter, annual group production and cost guidance for 2024 remain unchanged.
2024 group attributable gold equivalent production (excluding Asanko) is expected to be between 2.33Moz and 2.43Moz,
albeit gold production will be weighted to the second half of 2024.
Group AISC is expected to be between US$1,410/oz and US$1,460/oz while AIC is guided to be between US$1,600/oz and
US$1,650/oz for the year. These include approximately US$60/oz for the 2024 capital expenditure on the St Ives
renewable energy project. Excluding the costs for this project, the range for AISC is US$1,350/oz - US$1,400/oz and
US$1,540/oz to US$1,590/oz for AIC.
Capital expenditure for the year is guided at US$1.130bn - US$1.190bn while sustaining capital is guided to be between
US$860m and US$890m (including A$200m (US$132m) to be spent in 2024 on the St Ives renewable project). Non-sustaining
capex is expected to be US$270m - US$300m, with the largest component of this being the Salares Norte capital of
US$148m and Windfall capital of US$56m.
The above is subject to the forward-looking statement included below.
Mike Fraser
Chief Executive Officer
07 May 2024
Key statistics
United States Dollar
Quarter
Figures in millions unless otherwise stated March 2024 December 2023 March 2023
Gold produced* oz (000) 464 608 577
- Continuing operations oz (000) 464 594 563
- Discontinued operations^ oz (000) n/a 14 14
Tonnes milled/treated 000 9,904 10,653 10,699
- Continuing operations 000 9,904 9,984 9,994
- Discontinued operations^ 000 n/a 669 705
Revenue (excluding Asanko) US$/oz 2,079 1,987 1,901
Cost of sales before gold inventory change
and amortisation and depreciation (excluding Asanko) US$/tonne 51 54 51
AISC US$/oz 1,738 1,372 1,152
- Continuing operations US$/oz 1,738 1,356 1,149
- Discontinued operations^ US$/oz n/a 2,060 1,268
Total AIC US$/oz 2,115 1,632 1,343
- Continuing operations US$/oz 2,115 1,618 1,341
- Discontinued operations^ US$/oz n/a 2,248 1,394
Net debt US$m 1,143 1,024 875
Net debt (excluding lease liabilities) US$m 720 588 454
Net debt to adjusted EBITDA ratio 0.51 0.42 0.36
* Gold produced in this table is attributable and includes Gold Fields' share of 45% in Asanko.
^ Asanko was sold in Q1 2024 and the results from the operation have been excluded.
At 31 March 2024, all operations are wholly owned except for Tarkwa and Damang in Ghana (90.0%), South Deep in
South Africa (96.43%), Cerro Corona in Peru (99.5%), Gruyere JV (50%) and Asanko JV (45% equity share).
Gold produced and sold throughout this report includes copper gold equivalents of approximately 5% of Group
production.
AISC and total AIC in the key statistics table include all Gold Fields operations, projects and offices.
Figures may not add as they are rounded independently.
All-in cost reconciliation
United States Dollar
Quarter
March December March
Figures in millions unless otherwise stated 2024 2023 2023
AIC for mining operations US$/oz 1,733 1,321 1,142
Salares Norte US$/oz 319 243 183
Total AIC for mining operations including
Salares Norte (page 6) US$/oz 2,052 1,564 1,325
Windfall US$/oz 46 36 -
Corporate and other US$/oz 17 32 18
Total AIC US$/oz 2,115 1,632 1,343
Currencies and metal prices
United States Dollar
Quarter
Figures in millions unless March December March
otherwise stated 2024 2023 2023
US$1-ZAR 18.87 18.73 17.75
A$-US$ 0.66 0.65 0.68
Gold price (US$/oz) 2,079 1,987 1,901
Copper price (US$/tonne) 8,444 8,169 8,930
STOCK DATA FOR THE THREE MONTHS ENDED 31 MARCH 2024
Number of shares in issue NYSE - (GFI)
- at 31 March 2024 895,024,247 Range - Quarter US$12.37 - US$15.89
- average for the period 894,450,228 Average Volume - Quarter 4,437,912 shares/day
Free float 100 per cent JSE Limited - (GFI)
ADR ratio 1:1 Range - Quarter ZAR228.60 - ZAR303.90
Bloomberg/Reuters GFISJ/GFLJ.J Average volume - Quarter 2,655,954 shares/day
This summary operational update is the responsibility of the directors and further information,
including the detailed operational reviews can be found on the Company's website at
http://www.goldfields.com
The operational update of Gold Fields for the quarter ended 31 March 2024 has not been reviewed by the
Company?s auditor, PricewaterhouseCoopers Inc.
Forward-looking statements
This announcement contains forward-looking statements within the meaning of the "safe harbour" provisions of the
Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact included in
this announcement may be forward-looking statements. Forward-looking statements may be identified by the use of words
such as "aim", "anticipate", "will", "would", "expect", "may", "could", "believe", "target", "estimate", "project" and
words of similar meaning.
These forward-looking statements, including among others, those relating to Gold Fields' future business strategy,
development activities and other initiatives, particularly at the Salares Norte project, business prospects, financial
positions, production and operational guidance are necessary estimates reflecting the best judgement 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. By their nature, forward-looking statements involve
risk and uncertainty because they relate to future events and circumstances and should be considered in light of
various important factors, including those set forth in Gold Fields' Integrated Annual Report 2023 filed with the
Johannesburg Stock Exchange and annual report on Form 20-F filed with the United States Securities and Exchange
Commission (SEC) on 28 March 2024 (SEC File no. 001-31318). Readers are cautioned not to place undue reliance on such
statements. These forward-looking statements speak only as of the date they are made. Gold Fields 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 announcement or to reflect the occurrence of unanticipated events. These
forward-looking statements have not been reviewed or reported on by the Company's external auditors.
Executive Directors: MJ Fraser (Chief Executive Officer)
Non-Executive Directors: YGH Suleman (Chair) A Andani# PJ Bacchus* MC Bitar@ TP Goodlace JE McGill^ PG Sibiya
SP Reid^ CAT Smit
^Australian *British @Chilean #Ghanaian
Sponsor: J.P. Morgan Equities South Africa Proprietary Limited
Corporate secretary: Anr? Weststrate
Transfer secretaries: Computershare Investor Services (Proprietary) Limited
For the full Q1 2024 operational update go to www.goldfields.com
Date: 07-05-2024 09:57:00
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