Slide 1: Creating A Sustainable Business at US$1,300/oz
Creating A Sustainable Business at US$1,300/oz NICK HOLLAND Chief Executive Officer Denver Gold Forum, 23 September 2013
Slide 2: Forward looking statements
Forward looking statements Certain statements in this document constitute “forward looking statements” within the meaning of Section 27A of the US Securities Act of 1933 and Section 21E of the US Securities Exchange Act of 1934. In particular, the forward looking statements in this document include
Slide 3: The Transformation of Gold Fields
The Transformation of Gold Fields One Year After Melbourne What Investors Want Aug 2012 Nick Holland | Denver Gold Forum: Creating a Sustainable Business at US$1,300/oz | 23 September 2013 3
Slide 4: The Transformation of Gold Fields
The Transformation of Gold Fields One Year After Melbourne What Investors Want Aug 2012 Portfolio Review Aug - Dec 2012 Sibanye Gold Dec - Jan 2012 New Cash Strategy 2013 Business Plan A New Paradigm 15 April 2013 Gold Price US$1,300/oz It’s Not About Ounces, Its About Cash Nick Holland | Denver Gol
Slide 5: One Year After Melbourne
One Year After Melbourne Corporate Office Restructured ● Narrowly focussed on group functions: strategy; capital; growth; stakeholders; policies & standards; compliance & reporting ● Employees down ~50% to 56 ● Corporate costs ~US$10/oz Fit-for-purpose, Low-cost, Operating Model Introduced ● Regions
Slide 6: One Year After Melbourne: Elimination Of Marginal Mining
One Year After Melbourne Elimination Of Marginal Mining COMPLETED STILL TO DO ● St Ives - Heap leach operations stopped ● Tarkwa North heap leach stopped by end 2013 ● Agnew - Low grade high cost Rajah and Main ● 2013 Resources and Reserves and 2014 lodes stopped, focus on high grade Kim Operational
Slide 7: One Year After Melbourne: Growth & International Projects Group Disbanded
One Year After Melbourne Growth & International Projects Group Disbanded ● Central infrastructure and overheads for Growth and International Projects (GIP) Unit as well as Greenfields Exploration dismantled ● Greenfields exploration significantly reduced and moved into regional structures ● Explorat
Slide 8: One Year After Melbourne: Growth Projects For Sale or Under Review
One Year After Melbourne Growth Projects For Sale Growth Projects Under Review ● Arctic Platinum ● Far Southeast ‒ Appointed CIBC in June 2013 – process ‒ Focus on FPIC and FTAA started in August 2013 ‒ Explore high grade starter option ● Talas ● Chucapaca ‒ Appointed Jefferies in May 2013 – process
Slide 9: One Year After Melbourne: Additional US$230 Million Estimated Savings
One Year After Melbourne Additional US$230 Million Estimated Savings For 2013 ● Operating Costs: Additional savings of ~US$22 million1 ● Capital Expenditure: Additional savings of ~US$123 million ● Growth & International Projects: Additional savings of US$75 million ● Greenfields Exploration: Additi
Slide 10: One Year After Melbourne: NCE Reduced To US$1,239/oz
One Year After Melbourne NCE Reduced To US$1,239/oz NCE Same As 18 Months Ago Nick Holland | Denver Gold Forum: Creating a Sustainable Business at US$1,300/oz | 23 September 2013 10
Slide 11: Operations Refocussed To Generate Cash
Operations Refocussed To Generate Cash
Slide 12: Refocused For Cash: South Deep
Refocused For Cash South Deep Project (South Africa) Total Development Meters Up 51% Q on Q 5,000 ● New operating model still bedding down 4,000 ● Gap between broken grade and mill yield 3,000 2,000 ● Despite positive trajectory, key metrics still 1,000 - below plan Q3-2011 Q4-2011 Q1-2012 Q2-2012 Q
Slide 13: Refocused For Cash: Tarkwa
Refocused For Cash Tarkwa (Ghana) Next Steps ● Strike action resolved ● North heap leach operations to be closed by end of 2013 ● South heap leach operations stopped ‒ All-in heap leach costs circa (marginal mining) US$1,600/oz ‒ Approximately 5001 people will be ● TEP6 project cancelled affected ‒
Slide 14: Refocused For Cash: Damang
Refocused For Cash Damang (Ghana) ● Production down – strike & premature Action Plan closure of original Damang Pit due safety 1. Short-term recovery plan concerns ‒ Stabilise Operation and Limit Cash Outflow ● Existing mine at end of life 2. Short-term plan to improve plant ● Unreliability of agein
Slide 15: Refocused For Cash: Cerro Corona
Refocused For Cash Cerro Corona (Peru) ● Decrease in gold and copper grades, in TMF only to level 3,800m instead 3,815m line with 2012 Reserve declaration ● Construction of TMF only to level 3,800m instead 3,815m ● Lowest costs in Group - can maintain cost ● Drivers for this decision are: position −
Slide 16: Refocused For Cash: St Ives
Refocused For Cash St Ives (Australia) ● Fit-for-purpose, low-cost, operating model and structure is delivering results ● Further cost reductions and revenue enhancing measures under review ● Impairments of Reserves and asset base likely at year-end ● Significant exploration potential being realised
Slide 17: St Ives: Invincible Opportunity
Refocused For Cash St Ives (Australia): Invincible Opportunity • Major Discovery in 2012 • Discovery Hole to Maiden Invincible North Resource in 8 Months Extension • 8km from the Mill • Shallow Cover (~10m) • Significant Resource upside Invincible Inferred Dec 2012 ~160koz Open Pit (1.6Mt @ 3.0g/t)
Slide 18: Refocused For Cash: Agnew
Refocused For Cash Agnew (Australia) ● Fit-for-purpose, low-cost, operating model has set Agnew up as one of lowest cost producers in Group ● As operation goes deeper, costs and production will become more challenging ● Challenge is to maintain excellent performance ● Significant exploration potenti
Slide 19: Agnew: Exploration Upside at Waroonga North and FBH
Refocused For Cash Agnew (Australia): Exploration Upside at Waroonga North and FBH 2013Q3 10 targets approved ($1.3M) (conventional drilling) 10 targets approved ($0.7M) (underground diamond 2013Q4 drilling) 1st Rig: 7 targets ($1.2M) (conventional + directional drilling) 2nd Rig: 6 targets ($1.0M)
Slide 20: Acquiring Barrick's Yilgarn South Assets
Investing In Future Cash Flow! Acquiring Barrick’s Yilgarn South Assets
Slide 21: Overview
Overview Salient Features ● Binding agreement to acquire Barrick’s Yilgarn South Assets ‒ Granny Smith, Darlot and Lawlers mines in Western Australia ● US$300 million less ~US$30 million working capital adjustment at closing ‒ 2.6 Moz of Reserves1 (US$104/reserve ounce) ‒ 1.9 Moz of Resources2 (US$6
Slide 22: Rationale
Rationale Investing in Free Cash Flow ● Competitively priced & conservatively financed ● Regional consolidation and strategic diversification ● Immediate operational synergies ● Strong management team with proven track record ● Unmodelled exploration upside and potential for orogenic success A Compe
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Slide 24: A Well-balanced Global Producer
Improved Sovereign Risk Profile Improved Geographic Risk Profile Gold Fields Pre Sibanye Gold Fields Post Sibanye Gold Fields Post Yilgarn Acquisition 2012 3,348 2012 2,124 H1 2013 Proforma 2,256 Production (koz) Production (koz) Annualised (koz) Reserves (Moz)1 72.9 Reserves (Moz)1 59.4 Reserves (M
Slide 25: The Gold Fields Franchise In Australia
The Gold Fields Franchise In Australia Exploration Case Study - Orogenic Gold Deposits St Ives Agnew 3.0 2.3 5.6 2.2 1.4 2.5 1.2 2.0 0.6 Ounces (Moz) Ounces (Moz) 1.0 0.4 - (1.0) (0.6) (2.0) (3.0) (4.0) (5.8) (1.6) (1.9) Reserves Production & Discovery & Reserves Reserves Production & Discovery & Re
Slide 26: Consolidation and Operational Synergies: Agnew and Lawlers
Consolidation and Operational Synergies Agnew and Lawlers Waroonga New Holland Genesis 640m -700m Kim New Holland Genesis Underground Underground Underground ABX GFI • Reserves of 387,000 ounces, Resources of 330,000 ounces • Mining methods: Long hole open stoping, inclined room & pillar • Lawlers a
Slide 27: Consolidation and Operational Synergies: Lawlers and Agnew
Consolidation and Operational Synergies Lawlers and Agnew ● Working and capital cost reductions (Better utilisation of existing Jumbo Fleet) ● Connecting Waroonga and New Holland with a ~ 700m drive (not modelled) ● Improved recoveries and head-grade - coarser ore from Lawlers will recover better in
Slide 28: Granny Smith: Location
Granny Smith Location ● Reserves of 1.9 Moz, Resources of 1.3 Moz ● Mining methods: Long hole open stoping and inclined room & pillar ● 400km north of Kalgoorlie ● Wallaby underground is only active mine ● Granny Smith mill is located 11km northeast of Wallaby Underground ● Total production from Gra
Slide 29: Granny Smith
Granny Smith ● South dipping intrusives within conglomerate Wallaby Underground ● Stacked shear/lode system • 150m – 200m apart • 600m x 500m footprint • Gentle to Moderate dip to the NW • 5 – 10m thick lodes View toward North and Down ● Positive reconciliation – consistently outperforming against r
Slide 30: Conclusions
Conclusions
Slide 31: The Way Forward
The Way Forward Re-balancing For Survival at US$1,300/oz Becoming a Lean, Fit For Purpose Mid-tier Producer Nick Holland | Denver Gold Forum: Creating a Sustainable Business at US$1,300/oz | 23 September 2013 31
Slide 32: Questions
Investor Relations Contact Willie Jacobsz Senior Vice President Head of Investor Relations & Corporate Affairs Office: +27-11-562-9775 Mobile: +27-(0)82-971-9238 Willie.jacobsz@goldfields.co.za QUESTIONS www.goldfields.co.za