Annual municipal charges for water, rates, sewerage and electricity are thought to have been the main potential sources of upward pressure on the CPI for July
Construction group Wilson Bayly Holmes-Ovcon expects a strong rise in full-year headline earnings, though it will take a knock from the sale of its Mozambican steel unit
GOLD Fields posted its largest interim dividend since 2012 as its South Deep mine posted its first cash flows since the company bought it a decade ago and struggled to bring it to account.
Gold Fields paid a 50c per share dividend, the highest since its 160c payout in June 2012. The latest interim dividend dwarfed the total annual dividends paid since that year.
Gold Fields posted a net profit of $115m for the six months to end-June compared to a $2m loss the year before
"Gold Fields did well. They beat expectations for the first half of the year and raised expectations for a strong second half of the year. The big dividend shows commitment and they’re likely to pay more in the second half," said an analyst who declined to be named for company policy reasons.
The standout performance for the interim period was the 87% year-on-year increase in gold output from the South Deep mine, which has for years missed production targets and failed to generate cash.
Gold Fields bought the mine in 2006 and has spent a total of R28bn on it — including the R15bn purchase price — to develop it, changing mining methods and mine plans a number of times as it struggled to make the mine profitable.
In the second quarter of the year, it generated $63m in net cash flow for the first time as it employed a fresh mechanised mining approach, and a new management team took control of the operation and its 68-million ounce resource, the world’s second-largest known gold deposit after Grasberg in Indonesia.
Leon Esterhuizen, an analyst at Nedbank, pointed out during a presentation to analysts on Thursday, that if Gold Fields had not increased capital expenditure at South Deep mine and managed to extract the same tonnes it had in the first quarter, the costs at the mine would have been less than $1,000/oz and the cash flow would have been higher.
Nick Holland, Gold Fields CEO, said expenditure at the mine would remain at about R1.3bn for the next three or four years, and management would update the market in February on the longer term production and cost profile of the mine after extensive reworking of mine plans, staffing, equipment and skills forced Gold Fields to abandon its 770,000oz a year target for 2015.
Gold Fields grew interim production 87% to 140,000oz, ahead of target. The outlook for the full year was forecast to be 289,000oz for the year, an increase from an earlier forecast of 257,000oz.
The all-in cost at South Deep fell 20% to R622,453/kg.
The outlook for the year is for the all-in cost to be R595,000/kg, about R20,000 higher than an earlier forecast, as Gold Fields bumped up capital expenditure in 2016 by R211m for housing and new equipment as well as bonus payments for the mining teams exceeding targeted production
The strong performance at South Deep underpinned first-half production of 1.044-million ounces of gold compared to 1.036-million ounces a year ago.
Gold Fields raised its full-year production by 50,000oz to between 2.1-million and 2.15-million ounces at an all-in cost of $1,010oz including $50m of exploration spending at the Salares Norte prospect in South America.
Interim production in Australia fell 2% to 466,000oz, an output number ahead of what was planned for, and in Ghana output was 7% lower at 311,000oz.
In South America, output was down 15% to 128,000oz.
GOLD Fields posted its largest interim dividend since 2012 as its South Deep mine posted its first cash flows since the company bought it a decade ago and struggled to bring it to account.
Gold Fields paid a 50c per share dividend, the highest since its 160c payout in June 2012. The latest interim dividend dwarfed the total annual dividends paid since that year.
Gold Fields posted a net profit of $115m for the six months to end-June compared to a $2m loss the year before
"Gold Fields did well. They beat expectations for the first half of the year and raised expectations for a strong second half of the year. The big dividend shows commitment and they’re likely to pay more in the second half," said an analyst who declined to be named for company policy reasons.
The standout performance for the interim period was the 87% year-on-year increase in gold output from the South Deep mine, which has for years missed production targets and failed to generate cash.
Gold Fields bought the mine in 2006 and has spent a total of R28bn on it — including the R15bn purchase price — to develop it, changing mining methods and mine plans a number of times as it struggled to make the mine profitable.
In the second quarter of the year, it generated $63m in net cash flow for the first time as it employed a fresh mechanised mining approach, and a new management team took control of the operation and its 68-million ounce resource, the world’s second-largest known gold deposit after Grasberg in Indonesia.
Leon Esterhuizen, an analyst at Nedbank, pointed out during a presentation to analysts on Thursday, that if Gold Fields had not increased capital expenditure at South Deep mine and managed to extract the same tonnes it had in the first quarter, the costs at the mine would have been less than $1,000/oz and the cash flow would have been higher.
Nick Holland, Gold Fields CEO, said expenditure at the mine would remain at about R1.3bn for the next three or four years, and management would update the market in February on the longer term production and cost profile of the mine after extensive reworking of mine plans, staffing, equipment and skills forced Gold Fields to abandon its 770,000oz a year target for 2015.
Gold Fields grew interim production 87% to 140,000oz, ahead of target. The outlook for the full year was forecast to be 289,000oz for the year, an increase from an earlier forecast of 257,000oz.
The all-in cost at South Deep fell 20% to R622,453/kg.
The outlook for the year is for the all-in cost to be R595,000/kg, about R20,000 higher than an earlier forecast, as Gold Fields bumped up capital expenditure in 2016 by R211m for housing and new equipment as well as bonus payments for the mining teams exceeding targeted production
The strong performance at South Deep underpinned first-half production of 1.044-million ounces of gold compared to 1.036-million ounces a year ago.
Gold Fields raised its full-year production by 50,000oz to between 2.1-million and 2.15-million ounces at an all-in cost of $1,010oz including $50m of exploration spending at the Salares Norte prospect in South America.
Interim production in Australia fell 2% to 466,000oz, an output number ahead of what was planned for, and in Ghana output was 7% lower at 311,000oz.
In South America, output was down 15% to 128,000oz.
