Financial performance

CAPITAL ALLOCATION AND DEBT MANAGEMENT

Gold Fields' 2022 capital allocation priorities were to maintain the necessary levels of sustaining capex, invest in our Salares Norte project, continue reducing our debt, and adhere to our Dividend Policy.

Pleasingly, we achieved all these objectives despite significant headwinds in the form of double-digit mining inflation and disruptions associated with the terminated Yamana Gold acquisition.

The Group reduced its net debt by US$265m to US$704m, resulting in a net debt:EBITDA ratio of 0.29x. This compares with net debt of US$969m and a net debt:EBITDA ratio of 0.40x at
31 December 2021. Excluding lease liabilities, core net debt amounted to US$310m at the end of 2022.

Throughout the cycle, Gold Fields has maintained the capex levels we believe are essential to ensure the longevity of our portfolio. Group capex amounted to US$1,069m in 2022 compared with US$1,089m in 2021, comprising sustaining capex of US$656m (2021: US$576m) and growth capex of US$413m (2021: US$513m).

Looking ahead, our 2023 capital allocation priorities will again be informed by our strategy to improve the quality of our asset base and extend the life-ofmine of our portfolio while balancing returns to shareholders. As such, we will allocate the FCF we generate to:

• Funding Salares Norte: US$227m is budgeted for the continued construction of Salares Norte during 2023
• Maintaining levels of sustaining capex: Given the significant cost inflation faced by the gold industry over the past two years, the capital intensity required to sustain our assets has increased. As such, we believe spending US$350/oz – US$400/oz in sustaining capital is essential to ensuring the long-term health of the production base
• Rewarding shareholders with dividends: Gold Fields has a long and well established policy of rewarding shareholders by paying out between 25% and 35% of normalised earnings as dividends. Recognising the windfall received from the Yamana Gold break fee and our strong financial performance, Gold Fields declared a total dividend of R7.45/share in 2022, which translates to 47.2% of normalised earnings for the year – far exceeding the upper end of the Group's payout range. We have enhanced our Dividend Policy to pay out between 30% and 45% of normalised earnings from 2023 onwards
• Further reducing net debt and strengthening the balance sheet: Although the Group continued to decrease its net debt and net debt:EBITDA ratio during 2022, management believes that decreasing our debt levels further would be favourable

For 2023, we budgeted total capital of US$1,110m – US$1,170m, comprising sustaining capital of US$820m – US$850m and non-sustaining capital of US$290m – US$320m. The vast portion of the growth capital will be spent at Salares Norte, with US$227m in project capital budgeted for the year. In 2022, we spent US$286m in growth capital on Salares Norte, bringing total project spend to US$758m at end-December 2022. Taking into account escalation and delays, total project cost is expected to be approximately US$1,020m.

Liquidity profile

Gold Fields actively manages the liquidity and maturity profile of the Group's debt. However, we did not undertake any refinancing activities during 2022 given the uncertain outcome of the proposed Yamana Gold acquisition.

We were last active in the bond market in 2019, when we refinanced a number of bonds. In May 2019, we raised two new bonds, extending and staggering the maturity profile. A total of US$1bn was raised at an average coupon of 5,625%, with the maturity spread between five (2024) and 10 years (2029).

During 2023, we plan to refinance the following three revolving credit facilities (RCF), which are scheduled to run out this year:

• US$1.2bn RCF
• A$0.5bn RCF
• R2.5bn RCF

Hedging

Given the cyclical nature of our business and the volatility of the gold price, Gold Fields has implemented an active hedging programme in recent years. We do not enter long-term systematic hedges, but instead regularly evaluate the Company's position and outlook to determine whether short-term hedging is appropriate. Our policy allows for hedging to protect cash-flows:

• During times of significant capital expenditure
• For specific debt servicing requirements, and
• To safeguard the viability of higher cost operations

We did not have any revenue hedges (gold and copper price) in place during 2022, but did have a currency hedge on the Chilean Peso, as well as the oil hedges in Ghana and Australia. These hedges matured on 31 December 2022, and from the beginning of 2023 the business has not had any hedges in place.

For full details of our hedges, see the table below:

Table of 2022 hedges

Financial strategy

Gold Fields has a prudent approach to balance sheet management, with one of our strategic priorities being to reduce our gearing. Despite the elevated capex levels over the past four years, we managed to reduce our net debt from a peak of US$1,664bn in 2019 to US$704m at end-December 2022 (US$310m, excluding lease liabilities).

Given the cyclical nature of the gold industry, along with the limited control we have over key cost drivers - such as the gold price, currencies, wage inflation and the oil price - we aim to reduce our debt further to take advantage of value-adding opportunities.

Gold Fields' business strategy focuses on growing margin and FCF through the cycle. However, given the finite nature of our mines, ongoing investment is necessary to ensure the longevity of the portfolio. 2022 was another year of relatively high capex, with US$286m spent on advancing the Salares Norte project in Chile. Despite this, higher-than-planned gold prices enabled us to adhere to our well established Dividend Policy and reduce the Group's net debt by a further US$265m during the year. The 2023 financial year will again see significant investment into the Group's assets, with US$227m budgeted for the Salares Norte project.

Financial highlights

The high gold price again provided a tailwind to Gold Fields' financial results in 2022. While the average gold price received by the Group decreased slightly in US Dollar terms to US$1,785/oz, the weakening of our key operating currencies meant the average Australian Dollar gold price increased by 8% to A$2,592/oz and the average South African Rand gold price increased by 11% to R943,581/kg.

Group revenue increased to US$4.29bn in 2022 from US$4.20bn in 2021.

Cost of sales before amortisation and depreciation increased by 6% to US$1.76bn in 2022. AIC at US$1,320/oz and AISC at US$1,105/oz increased by 2% and 4%, respectively, from 2021 to 2022 - but were both below guidance for the year.

Other salient features during 2022 included the following:

• Royalty expenses decreased by 2% to US$110m
• The Group's taxation charge increased by 4% to US$442m from US$425m in 2021, with normal taxation increasing by 6% to US$475m (2021: US$449m)
• Total capex decreased by 2% to US$1,069m in 2022 from US$1,089m in 2021, in line with guidance
• Total impairments amounted to US$505m (pre-tax), driven by an increase in discount rates together with inflationary cost pressures experienced in 2022. The biggest impairments were at Tarkwa (US$325m pre-tax, US$220m post-tax), Cerro Corona (US$63m pre-tax, US$44m post-tax) and Far Southeast (US$114m) which was written down to a carrying value of nil

Considering the above, earnings for 2022 totalled US$711m – a 10% decrease from the US$789m reported in 2021 – while normalised earnings decreased by 7% to US$860m (2021: US$929m).

We provide a detailed analysis of our financial performance in the management's discussion and analysis of the Group's Annual Financial Statements of the 2022 AFR. The consolidated income statement, statement of financial position and cash-flow statement – extracted from the 2022 AFR.