Gold Fields settles into new normal

The two mines most affected by Covid-19, South Deep and Cerro Corona,Gold Fields settles into new normal have shown a strong recovery.

Gold Fields says its mines in SA and Peru bounced back in the three months ended September after they were severely disrupted by lockdowns during the previous quarter. The gold mining company says its business in general has performed well and continues to settle into the ‘new’ normal created by Covid-19.

In a third-quarter operational update, the company reported a 7% rise in gold production to 557,000 ounces from a year earlier. Quarter-on-quarter production was up 1%. All-in sustaining costs increased by 2% year-on-year but were down 3% from the previous quarter at $964 an ounce.

The Australian region produced 250,000 ounces while output from its mines in Ghana reached 211,000 ounces. Cerro Corona in Peru produced 51,000 once and South Deep had a strong recovery, producing 65,000 ounces. It said the SA mine was generating meaningful cash flow at current prices.While the impact of Covid-19 has been largely contained at our operations, a second wave has commenced in certain parts of the world – mainly in the Northern hemisphere,” CEO Nick Holland said.”However, we cannot rule out a second wave in the countries in which we operate and we must ensure that the necessary protocols are maintained across the business.”

The company further decreased net debt including leases to $1.16 billion by the end of September from $1.24 billion in June, implying a net debt to EBITDA ratio of 0.68x, compared to 0.84x. Following the end of the quarter, it repaid its outstanding 2020 bond using a combination of cash resources and its US dollar debt facilities.

It has maintained its full-year production target at between 2.2 million and 2.25 million ounces.

Its shares fell 0.7% to R164.92

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