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Strikes bite into Gold Fields' earnings

Feb 14 2013 09:21 Reuters
Striking Gold Fields mine workers.

Striking Gold Fields mine workers. (AFP)

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Johannesburg - Major bullion producer Gold Fields [JSE:GFI] reported a 20% fall in headline earnings in the fourth quarter of last year, largely because of the impact of an illegal strike at two of its South African mines it has since spun off.

Gold Fields was reporting the last full set of results that would include earnings before the unbundling of most of its South African assets into a new bullion producer Sibanye Gold, which listed on Monday.

In its next results, earnings from the mines folded into Sibanye will only be included for part of the quarter.

Headline earnings per share came in at 131 South African cents for the quarter, down from 165 cents in the previous quarter, a fall of about 20%. Its adjusted earnings were 187 cents per share compared to 202 cents in the previous quarter.

Gold Fields' chief executive Nick Holland told Reuters the fall in earnings "was mostly because of the 110 000 ounces of production we lost to the strike".    

Both operations that were hit by the strikes were unbundled into Sibanye, making Gold Fields more attractive to investors uncomfortable with the labour and political risks associated with South Africa.

The country's gold and platinum mines were hit by a wave of wildcat action last year that unleashed violence which killed over 50 people. 

The company's total dividend for the year was 235 cents compared to 330 cents last year, exceeding the 116 cents forecast by the Thomson Reuters SmartEstimate.

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gold fields  |  sibanye gold  |  mining
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