Johannesburg, South Africa — 17 May 2012 – Gold Fields Limited “’ the world’s fourth-largest gold producer “’ has reported an 18% fall in quarterly earnings, albeit above expectations, as output and the bullion price in South African rand both declined.
The group has, however, stuck to its 2012 production target of 3.5 to 3.7Moz.
Gold Fields adjusted earnings per share dropped from 368 cents in the previous quarter to 300 cents in Q1 of 2012, just above a Reuters poll of seven analysts that had seen the number coming in at 273.7 cents.
The group’s output fell 6% to 827,000oz in the three months to the end of March from the previous quarter.
Earnings were also constrained by the rand-denominated gold price. While the dollar gold price added 6.7% in the three-month period, the average rand gold price fell 4% to R421,000/kg because of the local currency’s appreciation against the greenback.
The price of gold in rand impacts Gold Fields, as roughly 50% of its output comes from South Africa. In addition, wage and power-cost increases have exceeded inflation in each of the last three years.
Source: Reuters. For more information, click here.