United States Dollars | ||
Six months ended | ||
Figures in millions unless otherwise stated | June 2022 (Reviewed) |
June 2021 (Unreviewed) |
Revenue from contracts with customers | 2,235.3 | 1,983.6 |
---|---|---|
– Gold1 | 2,132.1 | 1,877.2 |
– Copper2 | 103.2 | 106.4 |
Disclosure of disaggregated revenue from contracts with customers | ||
The Group generates revenue primarily from the sale of gold bullion and copper concentrate to refineries and banks. All revenue from contracts with customers is recognised at a point in time. The Group also produces silver which is an insignificant by-product. | ||
The disaggregation of revenue from contracts with customers by primary geographical market and product is described in the Segmental Operating and Financial Results. |
United States Dollars | ||
Six months ended | ||
Figures in millions unless otherwise stated | June 2022 (Reviewed) | June 2021 (Unreviewed) |
Salaries and wages | (199.9) | (188.4) |
---|---|---|
Consumable stores | (187.6) | (152.3) |
Utilities | (69.6) | (65.7) |
Mine contractors | (322.5) | (298.5) |
Other | (164.3) | (153.3) |
Cost of sales before gold inventory change and amortisation and depreciation | (943.9) | (858.2) |
Gold inventory change | 21.3 | 26.6 |
Cost of sales before amortisation and depreciation | (922.6) | (831.6) |
Amortisation and depreciation | (377.8) | (314.9) |
Total cost of sales | (1,300.4) | (1,146.5) |
United States Dollars | ||
Six months ended | ||
Figures in millions unless otherwise stated | June 2022 (Reviewed) |
June 2021 (Unreviewed) |
Interest received – environmental trust funds | 0.6 | 0.4 |
---|---|---|
Interest received – cash balances | 2.9 | 3.5 |
Total investment income | 3.5 | 3.9 |
United States Dollars | ||
Six months ended | ||
Figures in millions unless otherwise stated | June 2022 (Reviewed) |
June 2021 (Unreviewed) |
Interest expense – borrowings | (37.9) | (40.5) |
---|---|---|
Interest expense – lease liability3 | (11.3) | – |
Interest expense – environmental rehabilitation3 | (6.0) | – |
Borrowing costs capitalised4 | 17.0 | 4.5 |
Total finance expense | (38.2) | (36.0) |
3 | Lease interest of US$12.3m and environmental rehabilitation interest adjustments of US$4.3m for the six months ended 30 June 2021 were included in other costs. Refer note 9. |
4 | General borrowing costs of US$17.0m (June 2021: US$4.5m) arising on Group general borrowings were capitalised during the periods and related to the Salares Norte project. An average interest capitalisation rate of 3.1% (June 2021: 2.9%) was applied. |
United States Dollars | ||
Six months ended | ||
Figures in millions unless otherwise stated | June 2022 (Reviewed) |
June 2021 (Unreviewed) |
Far Southeast Gold Resources Incorporated ("FSE") | (0.6) | (0.7) |
---|---|---|
Asanko Gold | (3.8) | 17.2 |
Other | (0.7) | – |
Share of results of equity-accounted investees, after taxation | (5.1) | 16.5 |
United States Dollars | ||
Six months ended | ||
Figures in millions unless otherwise stated | June 2022 (Reviewed) | June 2021 (Unreviewed) |
Unrealised gain/(loss) and prior year mark-to-market reversals on derivative contracts | 8.0 | (38.3) |
---|---|---|
Realised gain/(loss) on derivative contracts | 15.4 | (14.3) |
Maverix warrants – loss on fair value | – | (0.5) |
Total gain/(loss) on financial instruments | 23.4 | (53.1) |
The Group's policy is to remain unhedged to the gold price. However, hedges are sometimes undertaken as follows:
Gold Fields may from time to time establish currency financial instruments to protect underlying cash flows.
In June 2019 fixed price ICE Gasoil cash settled swap transactions were entered into for a total of 123.2 million litres of diesel for the period January 2020 to December 2022 based on 50% of usage over the specified period. The average swap price is US$575 per metric tonne (equivalent to US$75.8 per barrel). At the time of the transactions, the average Brent swap equivalent over the tenor was US$59.2 per barrel.
At the reporting date, the marked-to-market value on the hedge was a positive US$8.7m with a realised profit of US$8.3m for the six months ended 30 June 2022.
In June 2019 fixed price Singapore 10ppm Gasoil cash settled swap transactions were entered into for a total of 75.0 million litres of diesel for the period January 2020 to December 2022 based on 50% of usage over the specified period. The average swap price is US$74.0 per barrel. At the time of the transactions, the average Brent swap equivalent over the tenor was US$57.4 per barrel.
At the reporting date, the marked-to-market value on the hedge was a positive A$8.5m (US$5.9m) with a realised profit of A$7.5m (US$5.4m) for the six months ended 30 June 2022.
In March 2020, a total notional amount of US$544.5m was hedged at a rate of CLP/US$836.45 for the period July 2020 to December 2022.
At the reporting date, the marked-to-market value on the hedge was a negative US$8.6m with a realised profit of US$1.6m for the six months ended 30 June 2022.
At 30 June 2022, the following hedges are outstanding:
* Have not been designated for hedge accounting and the changes in fair value are reflected in profit or loss.
United States Dollars | ||
Six months ended | ||
Figures in millions unless otherwise stated | June 2022 (Reviewed) |
June 2021 (Unreviewed) |
Share based payment expense1 | (4.1) | (6.4) |
---|---|---|
Total included in profit or loss for the period | (4.1) | (6.4) |
1 | The Group granted equity-settled instruments comprising share options and restricted shares to executive directors, certain officers and employees. During the periods ended 30 June 2022 and 2021, the Gold Fields Limited 2012 Share Plan as amended in 2016 was in place. At the Annual General Meeting on 18 May 2016, shareholders approved the adoption of the revised Gold Fields Limited 2012 Share Plan to replace the long-term incentive scheme ("LTIP"). The plan provides for four types of participation, namely Performance Shares ("PS"), Retention Shares ("RS"), Restricted Shares ("RSS") and Matching Shares ("MS"). This plan is in place to attract, retain, motivate and reward participating employees on a basis which seeks to align the interests of such employees with those of the Company's shareholders. |
United States Dollars | ||
Six months ended | ||
Figures in millions unless otherwise stated | June 2022 (Reviewed) |
June 2021 (Unreviewed) |
Long-term incentive plan expense2 | (11.4) | (11.5) |
---|---|---|
Total included in profit or loss for the period | (11.4) | (11.5) |
2 | Senior and middle management receive awards under the LTIP. The performance conditions of the LTIP are approved annually by the Remuneration Committee. The expected timing of the cash outflows in respect of each grant is at the end of three years after the original award was made. |
United States Dollars | ||
Six months ended | ||
Figures in millions unless otherwise stated | June 2022 (Reviewed) |
June 2021 (Unreviewed) |
Included in profit before royalties and taxation are the following | ||
Environmental rehabilitation interest adjustment3,4 | – | (4.3) |
Unwinding of discount on silicosis settlement costs3 | (0.5) | (0.6) |
Lease interest3,4 | – | (12.3) |
Social contributions and sponsorships3 | (7.6) | (8.1) |
Offshore structure costs3 | (7.2) | (7.7) |
3 | Included under "Other costs, net" in the consolidated income statement. |
4 | Lease interest of US$11.3m and environmental rehabilitation interest adjustments of US$6.0m for the six months ended 30 June 2022 were included in net interest expense. Refer note 4. |
United States Dollars | ||
Six months ended | ||
Figures in millions unless otherwise stated | June 2022 (Reviewed) |
June 2021 (Unreviewed) |
Exploration expense | ||
Australia | (10.0) | (14.6) |
Ghana | (6.3) | (4.8) |
Peru | (1.3) | (0.8) |
Chile | (15.2) | (12.7) |
Other | – | (0.5) |
Total exploration expense | (32.8) | (33.4) |
United States Dollars | ||
Six months ended | ||
Figures in millions unless otherwise stated | June 2022 (Reviewed) |
June 2021 (Unreviewed) |
South Africa | (1.5) | (1.1) |
Foreign | (57.1) | (53.0) |
Total royalties | (58.6) | (54.1) |
Royalty rates | ||
South Africa (effective rate)4 | 0.5% | 0.5% |
Australia5 | 2.5% | 2.5% |
Ghana6 | 4.1% | 4.1% |
Peru7 | 3.9% | 3.9% |
4 | Lease interest of US$11.3m and environmental rehabilitation interest adjustments of US$6.0m for the six months ended 30 June 2022 were included in net interest expense. Refer note 4. | |||||||||||||||||||||||||||||||||||
5 | The Mineral and Petroleum Resource Royalty Act 2008 ("Royalty Act") was promulgated on 24 November 2008 and became effective from 1 March 2010. The Royalty Act imposes a royalty on refined (mineral resources that have undergone a comprehensive level of beneficiation such as smelting and refining as defined in Schedule 1 of the Act) and unrefined (mineral resources that have undergone limited beneficiation as defined in Schedule 2 of the Act) minerals payable to the state. The royalty in respect of refined minerals (which include gold refined to 99.5% and above and platinum) is calculated by dividing earnings before interest and taxes ("EBIT") by the product of 12.5 times gross revenue calculated as a percentage, plus an additional 0.5%. EBIT refers to taxable mining income (with certain exceptions such as no deduction for interest payable and foreign exchange losses) before assessed losses but after capital expenditure. A maximum royalty of 5% has been introduced on refined minerals. The effective rate of royalty tax payable for the period ended 30 June 2022 was 0.5% of mining revenue (30 June 2021: 0.5%) equalling the minimum charge per the formula. | |||||||||||||||||||||||||||||||||||
6 | The Australian operations are subject to a 2.5% (June 2021: 2.5%) gold royalty on revenue as the mineral rights are owned by the state. | |||||||||||||||||||||||||||||||||||
7 | Minerals are owned by the Republic of Ghana and held in trust by the President. During 2016, Gold Fields signed a Development Agreement ("DA") with the Government of Ghana for both the Tarkwa and Damang mines. This agreement stated that the Ghanaian operations will be subject to a sliding scale for royalty rates, linked to the prevailing gold price (effective 1 January 2017). The sliding scale is as follows: | |||||||||||||||||||||||||||||||||||
|
||||||||||||||||||||||||||||||||||||
8 | The Peruvian operations are subject to a mining royalty calculated on a sliding scale with rates ranging from 1% to 12% of the value of operating profit. |
United States Dollars | ||
Six months ended | ||
Figures in millions unless otherwise stated | June 2022 (Reviewed) |
June 2021 (Unreviewed) |
The components of mining and income tax are the following: | ||
South African taxation | ||
– dividend withholding tax | (6.1) | (13.1) |
– company and capital gains taxation | (1.7) | (1.1) |
– prior year adjustment – current taxation | — | (1.4) |
– deferred taxation | (45.3) | (0.6) |
Foreign taxation | ||
– current taxation | (216.4) | (176.7) |
– deferred taxation | (4.0) | (23.2) |
Total mining and income taxation | (273.5) | (216.1) |
South Africa – current tax rates | ||
Mining tax1 | Y=34-170/X | Y=34-170/X |
Non-mining tax2 | 28.0% | 28.0% |
Company tax rate | 28.0% | 28.0% |
International operations – current tax rates | ||
Australia | 30.0% | 30.0% |
Ghana | 32.5% | 32.5% |
Peru | 29.5% | 29.5% |
1 | South African mining tax on mining income is determined according to a formula which takes into account the profit and revenue from mining operations. South African
mining taxable income is determined after the deduction of all mining capital expenditure, with the proviso that this cannot result in an assessed loss. Capital expenditure
amounts not deducted are carried forward as unredeemed capital expenditure to be deducted from future mining income. Accounting depreciation is ignored for the purpose
of calculating South African mining taxation. During June 2022, the South African Revenue Services published the draft 2022 Rates & Monetary Bill, inclusive of an
amendment to the gold tax formula from Y = 34 – 170/X to Y = 33 – 165/X in respect of year assessments ending on or after 31 March 2023, which is considered to be substantively enacted. This resulted in the effective mining tax rate used for deferred tax purposes for Gold Fields Operations Limited ("GFO") and GFI Joint Venture Holdings (Proprietary) Limited ("GFIJVH"), owners of the South Deep mine, decreasing from 29% at 30 June 2021 to 28% at 30 June 2022, amounting to a charge of R76.2m (US$4.9m) through profit or loss. In the formula above, Y is the percentage rate of tax payable and X is the ratio of mining profit, after the deduction of redeemable capital expenditure, to mining revenue expressed as a percentage. |
2 | Non-mining income of South African mining operations consists primarily of interest income. The corporate income tax rate will be reduced from 28% to 27% for tax years ending on after 31 March 2023, and is considered to be substantively enacted. |
Deferred tax is provided at the expected future rate for mining operations arising from temporary differences between the carrying values and tax values of assets and liabilities. In South Africa the tax rate which has been used for deferred tax purposes for mining assets is Y = 33 – 165/X and for non-mining assets is 27%, on the basis that these rates are considered to be substantively enacted.
United States Dollars | ||
Six months ended | ||
Figures in millions unless otherwise stated | June 2022 (Reviewed) |
June 2021 (Unreviewed) |
Basic earnings per share – cents | 57 | 44 |
---|---|---|
US$509.7m (June 2021: US$387.4m) by the weighted average number of ordinary shares in issue during the period of 890,640,752 (June 2021: 886,888,524). | ||
Diluted earnings per share – cents | 56 | 43 |
Diluted earnings per share is calculated by dividing the diluted profit attributable to owners of the parent of US$504.9m (June 2021: US$385.0m) by the diluted weighted average number of ordinary shares in issue during the period of 894,668,622 (June 2021: 892,457,239). | ||
Net profit attributable to owners of the parent has been adjusted by the following to arrive at the diluted profit attributable to owners of the parent: | ||
Profit attributable to owners of the parent | 509.7 | 387.4 |
South Deep minority interest at 10% | (4.8) | (2.4) |
Diluted profit attributable to owners of the parent | 504.9 | 385.0 |
The weighted average number of shares has been adjusted by the following to arrive at the diluted number of ordinary shares: | ||
Weighted average number of ordinary shares | 890,640,752 | 886,888,524 |
Share options in issue | 4,027,870 | 5,568,715 |
Diluted weighted average number of ordinary shares | 894,668,622 | 892,457,239 |
Headline earnings per share – cents | 58.0 | 45 |
Headline earnings per share is calculated by dividing headline earnings of US$518.0m (June 2021: US$395.5m) by the weighted average number of ordinary shares in issue during the period of 890,640,752 (June 2021: 886,888,524). | ||
Net profit attributable to owners of the parent is reconciled to headline earnings as follows: | ||
Long-form headline earnings reconciliation | ||
Profit attributable to owners of the parent | 509.7 | 387.4 |
Profit on disposal of assets, net | 0.1 | (6.2) |
Gross | 0.1 | (8.9) |
Taxation effect | — | 2.7 |
Non-controlling interest effect | — | — |
Impairment, reversal of impairment and write-off of investments and assets and other, net | 8.2 | 14.3 |
Impairment, net of reversal of impairment of investments and assets | 9.3 | 4.2 |
Write-off of exploration and evaluation assets | — | 14.6 |
Taxation effect | (1.1) | (4.5) |
Non-controlling interest effect | — | — |
Headline earnings | 518.0 | 395.5 |
Diluted headline earnings per share – cents | 57.0 | 44 |
Diluted headline earnings per share is calculated by dividing diluted headline earnings of US$513.2m (June 2021: US$393.1m) by the diluted weighted average number of ordinary shares in issue during the period of 894,668,622 (June 2021: 892,457,239). | ||
Headline earnings has been adjusted by the following to arrive at dilutive headline earnings: | ||
Headline earnings | 518.0 | 395.5 |
South Deep minority interest at 10% | (4.8) | (2.4) |
Diluted headline earnings | 513.2 | 393.1 |
United States Dollars | |||
Six months ended | |||
Figures in millions unless otherwise stated | June 2022 (Reviewed) |
June 2021 (Unreviewed) |
|
Investments | (5.7) | (3.8) | |
---|---|---|---|
Equity-accounted investees | |||
– Far Southeast Gold Resources Incorporated ("FSE")1 | (5.7) | (3.8) | |
Property, plant and equipment | (3.6) | (0.4) | |
Impairment of property, plant and equipment – other2 | (3.6) | (0.4) | |
Impairment of investments and assets | (9.3) | (4.2) |
1 | During the six month period ended 30 June 2022, impairment indicators were identified as a result of the reduction in the share price of Lepanto and FSE was impaired by US$5.7m (June 2021: US$3.8m) to its recoverable amount. The recoverable amount was based on the fair value less cost of disposal (“FVLCOD”) of the investment (level 2 in the fair value hierarchy). The FVLCOD was indirectly derived from the market value of Lepanto Consolidated Mining Company, being the 60% shareholder of FSE. |
2 | The US$3.6m in 2022 comprises US$3.0m (June 2021: US$0.4m) impairment of redundant assets in Peru and US$0.6m (June 2021: US$0m) impairment of redundant assets in Chile. |
Figures in millions unless otherwise stated | 31 Dec 2022 |
31 Dec 2023 |
31 Dec 2024 |
31 Dec 2025 |
31 Dec 2026 |
31 Dec 2029 |
Total |
Uncommitted loan facilities | |||||||
Rand debt | 1,362.0 | – | – | – | – | – | 1,362.0 |
Rand debt translated to US Dollar | 83.6 | – | – | – | – | – | 83.6 |
Total (US$m) | 83.6 | – | – | – | – | 83.6 | |
Committed loan facilities | |||||||
US Dollar debt | – | 45.0 | 1,348.3 | 45.0 | 460.0 | 496.9 | 2,395.2 |
Rand debt | – | 2,500.0 | – | – | – | – | 2,500.0 |
A$ Dollar debt | – | 500.0 | – | – | – | – | 500.0 |
Rand debt translated to US Dollar | – | 153.5 | – | – | – | – | 153.5 |
A$ Dollar debt translated to US Dollar | – | 345.0 | – | – | – | – | 345.0 |
Total (US$m) | – | 543.5 | 1,348.3 | 45.0 | 460.0 | 496.9 | 2,893.7 |
Total (US$m) Uncommitted and committed loan facilities | 83.6 | 543.5 | 1,348.3 | 45.0 | 460.0 | 496.9 | 2,977.3 |
Utilisation – Uncommitted loan facilities | |||||||
Rand debt | – | – | – | – | – | – | – |
Rand debt translated to US Dollar | – | – | – | – | – | – | – |
Total (US$m) | – | – | – | – | – | – | – |
Utilisation – Committed loan facilities (including US Dollar bond) | |||||||
US Dollar debt | – | – | 581.8 | – | – | 496.9 | 1,078.7 |
Rand debt | – | – | – | – | – | – | – |
A$ Dollar debt | – | 140.0 | – | – | – | – | 140.0 |
Rand debt translated to US Dollar | – | – | – | – | – | – | – |
A$ Dollar debt translated to US Dollar | – | 96.6 | – | – | – | – | 96.6 |
Total (US$m) | – | 96.6 | 581.8 | – | – | 496.9 | 1,175.3 |
Total (US$m) – Utilisation – Uncommitted and committed loan facilities | – | 96.6 | 581.8 | – | – | 496.9 | 1,175.3 |
Exchange rate: US$1.00 = R16.29 and US$1.00 = A$0.69 being the closing rates at 30 June 2022.
The Group has the following hierarchy for measuring the fair value of assets and liabilities at the reporting date:
Level 1 : Unadjusted quoted prices in active markets for identical assets or liabilities;
Level 2: Inputs other than quoted prices in Level 1 that are observable for the asset or liability, either directly (as prices) or indirectly (derived from prices); and
Level 3: Inputs for the asset or liability that are not based on observable market data (unobservable inputs).
The Group recognises transfers between levels of the fair value hierarchy at the end of the reporting period during which the change has occurred. There were no transfers during the periods ended 30 June 2022 and 31 December 2021.
The following table sets out the Group's financial assets and financial liabilities by level within the fair value hierarchy at the reporting date:
United States Dollars | ||||||||
30 June 2022 (Reviewed) | 31 December 2021 (Audited) | |||||||
Figures in millions unless otherwise stated | Total | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 |
Financial assets measured at fair value | |
|
|
|
|
|
|
|
---|---|---|---|---|---|---|---|---|
Environmental trust funds | 2.9 | – | 2.9 | – | 2.9 | – | 2.9 | – |
Trade receivables from provisional copper sales | 2.6 | – | 2.6 | – | 25.8 | – | 25.8 | – |
Investments – listed | 18.6 | 18.6 | – | – | 30.9 | 30.9 | – | – |
Asanko redeemable preference shares | 96.6 | – | – | 96.6 | 94.5 | – | – | 94.5 |
Oil derivative contracts | 14.6 | – | 14.6 | – | 5.1 | – | 5.1 | – |
Financial assets not measured at fair value | |
|
|
|
|
|
|
|
Environmental trust funds | 109.6 | – | 109.6 | – | 85.2 | – | 85.2 | – |
Loan advanced – contractor | 27.3 | – | – | 27.3 | 27.3 | – | – | 27.3 |
Financial liabilities measured at fair value | |
|
|
|
|
|
|
|
Foreign exchange derivative contracts | 8.6 | – | 8.6 | – | 6.8 | – | 6.8 | – |
Financial liabilities not measured at fair value | |
|
|
|
|
|
|
|
Borrowings | 1,183.4 | 1,003.3 | – | 180.1 | 1,191.6 | 1,108.1 | – | 83.5 |
Environmental trust funds
are measured at fair value through profit or loss and amortised cost which approximates fair value based on the nature of the fund's underlying investments.
Trade receivables from provisional copper sales
Valued using quoted market prices based on the forward London Metal Exchange ("LME") and, as such, classified within Level 2 of the fair value hierarchy.
Listed investments
Comprise equity investments in listed entities and therefore valued using quoted market prices in active markets.
Asanko redeemable preference shares
The fair value is based on the expected cash flows of the Asanko Gold Mine based on the life-of-mine model. The key inputs used in the valuation of the fair value were market related interest rates and expected redemption period.
Oil and foreign exchange derivative contracts
The fair values of these contracts are determined by using the applicable valuation models for each instrument type with the key inputs being forward prices, interest rates, volatilities and exchange rates.
Borrowings
The 5-year notes and the 10-year notes are issued at a fixed interest rate. The fair values of these notes are based on listed market prices and are classified within Level 1 of the fair value hierarchy. The fair value of the remaining borrowings approximates their carrying amount, determined using the discounted cash flow method using market related interest rates and are classified within Level 3 of the fair value hierarchy.
Loan advanced – contractor
The fair value of the contractor loan approximates its carrying amount, determined using the discounted cash flow method and market related interest rates and is classified within Level 3 of the fair value hierarchy.
United States Dollars | ||
Figures in millions unless otherwise stated | June 2022 (Reviewed) | Dec 2021 (Audited) |
Commitments | ||
Capital expenditure | ||
Contracted for1 | 183.3 | 251.9 |
1 | Contracted for capital expenditure includes US$114.0m (2021: US$193.3m) for Salares Norte. |