Gold Fields

Basis of preparation

The condensed consolidated financial statements as set out herein are prepared in accordance with the requirements of the JSE Limited Listings Requirements for preliminary reports and the requirements of the Companies Act of South Africa. The Listings Requirements require preliminary reports to be prepared in accordance with the framework concepts and the measurement and recognition requirements of International Financial Reporting Standards (IFRS) and the SAICA Financial Reporting Guides as issued by the Accounting Practices Committee and Financial Pronouncements as issued by the Financial Reporting Standards Council and to also, as a minimum, contain the information required by IAS 34 Interim Financial Reporting.

The condensed consolidated financial statements do not include all the disclosures required for complete annual financial statements prepared in accordance with IFRS as issued by the International Accounting Standards Board. The condensed consolidated financial statements are prepared on a going concern basis. The Board is satisfied that the liquidity and solvency of the Company is sufficient to support the current operations for the next 12 months.

The condensed consolidated financial statements are presented in United States Dollars, which is Gold Fields Limited's presentation currency. The accounting policies applied in the preparation of these condensed consolidated financial statements are in terms of International Financial Reporting Standards and are consistent with those applied in the previous annual financial statements.

Pro forma financial information

The preliminary financial statements contain certain non-IFRS financial measures in respect of the Group's financial performance, the statement of financial position and cash flows presented in order to provide users with relevant information and measures used by the Group to assess performance. These measures constitute proforma financial information in terms of the JSE Listings Requirements and are the responsibility of the Group's Board of Directors. They are presented for illustrative purposes only and due to their nature, may not fairly present Gold Fields' financial position, changes in equity, results of operations or cash flows.

The key non-IFRS measures used and defined in the media release include:

  • Normalised profit which is defined as profit excluding gains and losses on foreign exchange, financial instruments and non-recurring items after taxation and non-controlling interest effect;
  • Net debt which is calculated as borrowings plus the current portion of borrowings and lease liabilities less cash and cash equivalents;
  • Cash flow from operating activities less net capital expenditure, environmental payments, lease payments and redemption of Asanko preference shares:
  • Adjusted EBITDA is required to be determined in terms of loan and revolving credit facilities agreements to evaluate compliance with debt covenants;
  • Free cash flow margin is used as key metric in the determination of the long-term incentive plan; and
  • All-in sustaining costs and total all-in-costs are presented to provide transparency into the costs associated with producing and selling an ounce of gold and is a common measure presented within the mining industry.
Auditor's review

The condensed consolidated financial statements of Gold Fields Limited for the year ended 31 December 2020 have been reviewed by the company's auditor, PricewaterhouseCoopers Inc.

The auditor's report does not necessarily report on all of the information contained in this media release. Shareholders are therefore advised that in order to obtain a full understanding of the nature of the auditor's engagement they should refer to Independent auditors review report on condensed consolidated financial statements of the media release for a copy of the auditor's report.

The pro-forma financial information has been reported on by the Group's auditors, being PricewaterhouseCoopers Inc. Their unqualified reporting accountant's report thereon is available for inspection at the Company's registered address.

Silicosis and tuberculosis class and individual actions

The Settlement Agreement in the silicosis and tuberculosis class action litigation has become operational on 10 December 2019. A settlement trust, known as the Tshiamiso Trust, has been established to carry out the terms of the Settlement Agreement and is responsible for ensuring that all eligible current and former mineworkers across southern Africa with silicosis or work-related TB (or their dependants where the mineworker has passed away) are compensated. The Board of Trustees are chaired by Professor May Hermanus as an independent trustee.

Over the course of 2020, the Tshiamiso Trust worked to create the capacity and establish the systems to begin to deliver on its mandate. However, the COVID-19 pandemic has had a significant impact on the work of the Trust. During October 2020, the Trust identified a test group of potential claimants. On 3 December 2020, the Trust made its first payments to 6 of these claimants. Each recipient received R250 000.

Information on the progress in the implementation of the object of the Tshiamiso Trust and other details can be found at https://www.tshiamisotrust.com

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 31 December 2020, the provision for Gold Fields' share of the settlement of the class action claims and related costs amounted to US$18m (R269m). The nominal value of this provision is US$23m (R339m).

The ultimate outcome of this matter however remains uncertain, with the number of eligible workers successfully submitting claims and receiving compensation being uncertain. The provision is consequently subject to adjustment in the future.

Placing of ordinary shares 

On 12 February 2020, Gold Fields successfully completed the placing of 41,431,635 new ordinary, no par value shares with existing and new institutional investors at a price of R90.20 per share. Gross proceeds of approximately R3.7bn (US$249.0m) were raised through the placing. The net proceeds from the placing will be used to continue pre-development work and commence construction of the Salares Norte project.

Syndicated revolving credit facilities extension

In July 2020 Gold Fields exercised a one year extension request for the US$1.2bn bank syndicated revolving credit facilities.

The final uptake of the one year extension for Tranche A and B of the US$1.2bn RCF was US$870m. Tranche A, a US$600m three year RCF terminates 25 July 2022, US$485m has been extended to 25 July 2023. Tranche B, a US$600m five year RCF terminates on 25 July 2024, US$485m has been extended to 25 July 2025.

Repayment of 2020 bond

The outstanding bonds in the amount of US$750m of Gold Fields US$1bn 4.875% Guaranteed Notes issued in 2010 and due in 2020 were redeemed by Gold Fields Orogen Holding (BVI) Limited on 7 October 2020 from a combination of cash of US$358m and drawing down US$392m from the US$ revolving credit facility.

Segment reporting

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

Year ended 2020 US$'m
Net profit 745.4
– Operating segments 748.5
– Corporate and projects (3.1)
Year ended 2019 US$'m
Net profit 174.7
– Operating segments 380.7
– Corporate and projects (206.0)

Additional notes include:

Nick Holland
Chief Executive Officer

18 February 2021