Outlook for 2019

Attributable equivalent gold production for the Group for 2019 is expected to be between 2.13 million ounces and 2.18 million ounces. AISC (based on the original WGC interpretation) is expected to be between US$980 per ounce and US$995 per ounce. AIC is planned to be between US$1,075 per ounce and US$1,095 per ounce.

The above is subject to safety performance which limits the impact of safety-related stoppages and the forward looking statement.

Basis of preparation

The unaudited condensed consolidated interim financial statements are prepared in accordance with International Financial Reporting Standard, (IAS) 34 Interim Financial Reporting, the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and Financial Pronouncements as issued by Financial Reporting Standards Council and the requirements of the Companies Act of South Africa.

The accounting policies applied in the preparation of these interim financial statements are in terms of International Financial Reporting Standards and are consistent with those applied in the previous annual financial statements except for the adoption of IFRS 16 Leases (IFRS 16).

Changes in significant accounting policies

The Group applied IFRS 16 initially on 1 January 2019, using the modified retrospective approach. The Group recognised lease liabilities in relation to leases which had previously been classified as 'operating leases' under the principles of IAS 17 Leases. These liabilities were measured at the present value of the remaining lease payments, discounted using the interest rate implicit in the lease or the lessee's incremental borrowing rate as of 1 January 2019. This resulted in an additional lease liability of US$210 million. The Group elected to recognise the right-of-use assets at an amount equal to the lease liability at 1 January 2019; and the Group applied the following practical expedients for IFRS 16:

For leases previously classified as finance leases the entity recognised the carrying amount of the lease asset and lease liability immediately before transition as the carrying amount of the right of use asset and the lease liability at the date of initial application.

The key judgements applied by the Group in applying IFRS 16, included the following:

The Group recognised right-of-use assets and lease liabilities for its operating leases for the following material contracts:

The adoption of IFRS 16 affected all segments in the Group.

Silicosis and tuberculosis class and individual actions

As previously reported, the Gold Working Group (comprising African Rainbow Minerals, Anglo American SA, AngloGold Ashanti, Gold Fields, Harmony and Sibanye-Stillwater) (the "GWG Parties") concluded a settlement agreement (the "Settlement Agreement") with the attorneys representing claimants in the silicosis and tuberculosis class action litigation on 3 May 2018. The Settlement Agreement provides meaningful compensation to eligible workers suffering from silicosis and/or tuberculosis who worked in the GWG Parties' mines from 12 March 1965 to the effective date of the Settlement Agreement.

On 26 July 2019, a full bench of the High Court of South Africa (Gauteng Local Division, Johannesburg) (the "Court") approved the settlement of the silicosis and tuberculosis class action by sanctioning the Settlement Agreement and making it an order of court.

One further step that needs to be taken before the commencement of the operations of the Trust which will administer claims and payments to eligible claimants, is that class members need to be given the opportunity to opt out of the settlement. This is because the agreement acknowledges that no individual can be forced to forego his or her right to pursue litigation should he or she so choose.

Once the opt out period is over and the Settlement Agreement becomes effective, the Tshiamiso Trust will then commence and the real work of implementing the settlement agreement will begin. This will include the Trust tracking and tracing class members, processing all submitted claims, including the undertaking of benefit medical examinations and the payment of benefits to eligible claimants.

Benefits provided for in the agreement and other details can be found at https://www.silicosissettlement.co.za/about.

Provision raised

Gold Fields has provided for the estimated cost of the above settlement based on actuarial assessments and the provisions of the Settlement Agreement. At 30 June 2019, the provision for Gold Fields' share of the settlement of the class action claims and related costs amounts to US$27 million (R384 million). The nominal value of this provision is US$35 million (R507 million).

This provision compares to the initial amount raised in June 2017 of US$30 million (R390 million). The decrease is due to a change in the timing of expected cash flows.

The ultimate outcome of this matter remains uncertain, with a possible failure to fulfil all the suspensive conditions. The provision is consequently subject to adjustment in the future.

Segment reporting

The net profit/(loss) (excluding Asanko) per the income statement reconciles to the net profit/(loss) in the segmental operating and financial results as follows:

Nick Holland
Chief Executive Officer
15 August 2019