Gold Fields’ Profit Declines 7.4% After Strikes Cuts Production
Gold Fields Ltd., a producer of the metal that spun off some of its South African operations this week, said profit fell 7.4 percent in the fourth quarter, missing expectations, because of lost production from illegal strikes.
Adjusted net income in the three months through December was 1.37 billion rand ($155 million), or 1.87 rand a share, compared with 1.48 billion rand, or 2.02 rand a share, a quarter earlier, the Johannesburg-based company said in a statement today. The median estimate by six analysts in a Bloomberg survey was for a profit of 2.03 rand a share. Output declined to 754,000 ounces from 811,000 ounces in the September quarter.
Gold Fields on Feb. 11 spun off its deeper, more labor- intensive South African mines into Sibanye Gold Ltd., partly reacting to strikes that began in the country’s platinum industry before spreading to other operations. All three of Gold Fields’ operating mines in South Africa returned to production in November after two months of wildcat stoppages that involved as many as 23,540 of Gold Fields’s 35,700 workers.
“While the international operations had an outstanding quarter, KDC and Beatrix in South Africa were impacted by the industry-wide illegal strikes in the South African mining industry,” Chief Executive Officer Nick Holland said in a statement.
Strikes at the KDC and Beatrix mines resulted in 110,000 ounces of lost production, the company said.
The average price for gold in the quarter through December was $1,718 an ounce compared with $1,653 in the previous three months.
Profit for the year through December declined to 6.83 billion rand from 7.24 billion rand a year earlier. Gold analysts in South Africa compare quarters sequentially.
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