Sibanye Gold Cuts Production Outlook on Operational Disruptionsby
Gold output this year will be 4%-6% below original forecast
Earnings per share to be more than 20% below previous year
Sibanye Gold Ltd. cut its output forecast for this year as the biggest producer of South African bullion failed to recover from operational problems in the first quarter.
Production will be 4 percent to 6 percent lower in a range of 1.51 million and 1.54 million ounces this year, the Westonaria, South Africa-based company said in a statement Thursday. Earnings per share will fall at least 20 percent, the company said.
Output was reduced during the third quarter due to two fires at the Kloof mine and seismic activity at Driefontein, Sibanye said. Driefontein was also affected by labor unrest related to wage negotiations, which were concluded with all unions except one on Oct. 22.
"Various operational disruptions and distractions related to the ongoing wage negotiations have continued to impede a full recovery at Kloof, and to a lesser extent, Driefontein," Sibanye said.
The company, which has a 12-month dividend yield of 3.13 percent, has struggled with operational issues this year. First-quarter production fell 5.2 percent from a year earlier because of a series of processing-plant incidents and conveyor problems at Kloof.
The stock declined 8.9 percent to 22.82 rand a share at 10:18 a.m. in Johannesburg, paring this year’s increase to 1.4 percent. Gold dropped 0.9 percent Wednesday after the Federal Reserve bolstered prospects for a December interest-rate increase. The precious metal was 0.2 percent higher at $1,158.69 an ounce on Thursday.