Good�morning�ladies�and�gentlemen,�today’s�presentation�will� Good o g ad es a d ge t e e , today s p ese tat o focus�on�Gold�Fields’�growth�strategy.��We�have�a�target�of�5m� oz�per�year,�either�in�production�or�development�by�2015.�� The�presentation�provides�a�roadmap�on�how�we�intend� getting�there,�why�discovery�matters�to�the�strategy�and�also� some detail on the various opportunities we have in the some�detail�on�the�various�opportunities�we�have�in�the� pipeline�that�are�likely�to�contribute�to�the�target.���� 1
I�draw�your�attention�to�out�forward�looking�statements�and� d a you atte t o to out o a d oo g state e ts a d given�that�this�is�on�growth�the�statement�becomes�all�the� more�relevant.� 2
Gold�Fields�recently�announced�its�F2010�year�end�results.��A� summary�of�the�key�indicators�will�provide�a�good�introduction�to� our�growth�strategy.��In�addition,�our�performance�supports�the� investment�case�for�Gold�Fields,�which�I�have�combined�for� purposes�of�this�presentation.�� In�terms�of�a�rising�production�profile,�attributable�production�was� up 2% at 3.5moz. In particular, production at South Deep was up up�2%�at�3.5moz.��In�particular,�production�at�South�Deep�was�up� 52%�to�265koz,�at�Tarkwa�it�was�up�20%�to�720koz�and�at�Cerro� Corona�it�was�up�80%�to�394k�gold�eq oz.� Gold�Fields�is�an�industry�leader�with�total�attributable�reserves�of� 78m�oz,�a�reserve�life�in�excess�of�20�years�and�resources�of� 281moz.� We have an extensive pipeline of growth opportunities with both We�have�an�extensive�pipeline�of�growth�opportunities�with�both� greenfields and�brownfields�exploration�projects�at�different� stages�of�development.��In�F2010�we�added�6.5m�eq ounces�to� attributable�resource�at�a�cost�of�about�$12/oz.�� We�are�focused�on�free�cash�flow�and�have�introduced�the� measure�Notional�Cash�Expenditure�or�NCE.��NCE�is�an�important� measure as it indicates how much free cash flow is generated to measure�as�it�indicates�how�much�free�cash�flow�is�generated�to� pay�tax,�interest,�greenfields exploration�&�dividends.��The�NCE� margin�improved�by�2%�from�13%�in�F2009�to�15%�in�F2010�and� this�during�a�capital�intensive�period�while�we�build�South�Deep.�� Gold�Fields�has�low�gearing�levels�and�a�conservative�financial� policy,�which�includes�a�strict�policy�of�no�hedging. O h d d iti id ll t t th ld
This�graph�neatly�summarises our�performance�for�the�year� s g ap eat y su a ses ou pe o a ce o t e yea ended�June�2010�in�the�one�metric�that�counts�the�most�– cash�flow�generation�or�NCE�margin.��Not�only�have�we� capitalised�on�higher�gold�prices�but�we�have�contained�our� costs�and�driven�volume�growth.��We�intend�to�continue�this� trend in 2011. trend�in�2011. 4
South�Deep�is�a�key�asset�for�Gold�Fields�and�the�flagship� Sout eep s a ey asset o Go d e ds a d t e ags p growth�project�in�South�Africa.��The�production�build�up�is� on�track�and�we�are�well�placed�to�deliver�the�required� volume�to�achieve�full�production�of�between�750koz�and� 800koz�by�December�2014.��Production�at�South�Deep�for� 2011 is estimated at between 320koz and 350koz. The 2011�is�estimated�at�between�320koz�and�350koz.��The� capital�programme�is�also�on�track.��We’ve�spent�R1.6bn�at� South�Deep�in�F2010.��Capital�is�expected�to�peak�at�around� R2bn�a�year�over�the�next�two�years�after�which�it�will� decrease�substantially.��Peak�capital�can�be�attributed�to�the� deepening of the ventilation shaft which commenced in deepening�of�the�ventilation�shaft,�which�commenced�in� April�2010�and�is�planned�for�completion�in�2012.��The�shaft� deepening�is�key�to�South�Deep�achieving�330ktpa,�which�is� the�volume�required�to�achieve�full�production.���We�have� also�commenced�construction�of�the�tailings�dam�and�we� are at an advanced stage of designing the plant expansion are�at�an�advanced�stage�of�designing�the�plant�expansion.���� 5
The�table�outlines�the�critical�path�items�in�terms�of�delivering� e tab e out es t e c t ca pat te s te s o de e g South�Deep.��We�are�managing�capital�efficiently�by�meeting� budgets�and�where�possible�showing�significant�savings.��We� are�also�applying�innovative�solutions�to�help�de�risk� commissioning�dates. More importantly, this project is being delivered safely. More�importantly,�this�project�is�being�delivered�safely. 6
Our�achievements�in�F2010�and�beyond�are�driven�by�Gold� Ou ac e e e ts 0 0 a d beyo d a e d e by Go d Fields’�group�strategy.��The�three�core�pillars�of�our�strategy� are�underpinned�by�an�unhedged�position�and�collectively�aim� to�achieve�free�cash�flow.� The�pillar�of�sweating�our�assets�is�about�our�existing�portfolio� of assets with the number one priority being safe production. of�assets�with�the�number�one�priority�being�safe�production.�� The�focus�here�is�to�ensure�that�we�run�our�operations�as� efficiently�as�possible.� The�pillar�of�securing�our�future�is�about�ensuring�the�long� term�sustainability�of�our�businesses.��It�encompasses�safety,� human capital as well as the environmental and social licenses human�capital�as�well�as�the�environmental�and�social�licenses� to�operate�in�each�jurisdiction.�� Growing�Gold�Fields�is�about�growing�the�portfolio�with� ounces�that�are�better�on�an�NCE�basis,�offer�growth�per�share� and�enhance�returns.��This�leads�me�onto�our�growth�strategy.� 7
We�are�targeting�five�million�ounces�per�year,�in�production�or� e a e ta get g e o ou ces pe yea , p oduct o o in�development,�by�2015.��The�goal�is�for�South�Africa�to� contribute�at�least�2m�ounces�to�this�target,�and�for�the� international�regions�i.e.�South�America,�Australasia�and�West� Africa�to�each�contribute�about�1m�attributable�ounces�per� year. This will grow our international presence and achieve a year.��This�will�grow�our�international�presence�and�achieve�a� 60�40�production�split�between�the�international�and�South� African�operations.�� 8
We�intend�growing�through�exploration.��This�does�not�mean� e te d g o g t oug e p o at o s does ot ea that�we�will�not�acquire�assets.��It�means�that�we�will�not� engage�in�“M&A�Heroics.”��Our�M&A�strategy�is�therefore� opportunistic.��We�will�consider�investments�in�producing� assets�and�late�stage�development�projects�which�are�value� accretive. accretive.�� Having�said�that,�a�continuing�lack�of�quality�gold�discoveries� in�the�industry�has�led�to�escalating�competition�for�advanced� exploration�and�producing�assets.��This�makes�growth�through� M&A�expensive�and�dilutive.� For this reason and in the current price environment we For�this�reason�and�in�the�current�price�environment,�we� believe�exploration�success�offers�the�most�cost�effective�path� to�accretive�and�value�adding�growth.�� Our�growth�strategy�is�therefore�premised�on�creating�our� own�high�quality�growth�opportunities�mainly�through�an� aggressive focus on near mine exploration at our existing aggressive�focus�on�near�mine�exploration�at�our�existing� assets�and�an�equally�aggressive�greenfields exploration� programme�in�the�regions�where�we�are�based�and�in�a� limited�number�of�highly�prospective�“new�frontiers”�around� the�world.�� 9 Since adopting this strategy 3�years ago we have doubled our
Recommend
More recommend