Gold Fields earnings more than double
May 8, 2009
By Ron Derby
Third-quarter profit for Gold Fields more than doubled on higher prices and output, Africa's second-largest miner of the metal said, forecasting a further increase in production.
Net income rose to R1.31 billion in the three months to March from R483 million in the preceding quarter, Gold Fields said in a statement yesterday.
While Gold Fields endured a very challenging three months, the company "remains on a positive trajectory with production increasing by 4 percent in the quarter", said chief executive Nick Holland.
Gold mining companies are looking to increase output as prices climb because of investor demand for the precious metal as a store of value.
Gold for immediate delivery in London has rallied for eight consecutive years.
Gold Fields rose for a fourth successive day. Earnings per share before one-time items of R2.25 were above the R2.07 median estimate from a Bloomberg survey of four analysts.
So-called attributable output advanced 4 percent to 871 000 ounces, helping to bring the gain in overall production for the last two quarters to 10 percent.
The company anticipated an increase of "similar size" in the next quarter, Holland said.
African production rose 3 percent, while international output gained 5 percent.
Gold Fields secured credit lines from banks and sold bonds to repay debt, it said.
The company received a R1.5bn five-year revolving credit facility from two banks and a $311m (R2.6bn) syndicated loan.
Gold Fields shares fell 2.5 percent to close at R97.01 on the JSE yesterday. - Bloomberg
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