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Gold Fields flags lower H1 earnings, possible higher costs at Gruyere JV


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Gold Fields flags lower H1 earnings, possible higher costs at Gruyere JV

Gold Fields Ltd. said in an Aug. 8 trading statement that it expects basic EPS for the first half to be at least 20% lower than the 7 U.S. cents reported for the same period a year earlier.

The company plans to report financial results for the period Aug. 16.

Gold Fields said in May that it was putting acquisition plans on hold for a year to focus on its existing operations and nearby prospects. CEO Nick Holland said at the time that the company's finances might be "a little bit negative" this year before likely recovering in 2019.

Separately, Stuart Mathews, the company's executive vice president for Australasia, flagged the possibility of another cost overrun on the 50% owned Gruyere JV gold project in Western Australia, The West Australian reported Aug. 8. Gold Road Resources Ltd. owns the remaining 50% of Gruyere.

Project costs are already more than A$100 million beyond the A$507 million budgeted originally, with the revised budget subject to a 2% variance, according to the report. "We think we're comfortable with 2% because we've committed 85% of the money and we've expended about 60%," Matthews was quoted as saying on the sidelines of the Diggers & Dealers Mining Forum.

He attributed the additional costs to higher commodity prices that have raised steel fabrication prices as well as bad weather conditions that have led to delays.