Gold Fields 3rd-Quarter Profit Falls 6% on Gold Price (Update1)
By Dylan Griffiths and Jonathan Rosenthal
05/10 03:17
Johannesburg, May 10 (Bloomberg) -- Gold Fields Ltd., the world's third-biggest gold producer, said third-quarter profit fell 6 percent from the preceding quarter because of lower bullion prices.
Net income dropped to 261 million rand ($32.9 Million), or 57 cents a share, in the quarter ended March 31 from 277 million rand, or 61 cents, in the quarter before. Production fell 5 percent to 889,000 ounces.
While the company is suffering from declining prices, Chairman and Chief Executive Chris Thompson has been cutting costs to offset lost revenue. Gold Fields said it will close the St. Helena mine, which produces about 3 percent of its gold, after failing to sell shares in the mine to black-owned partners.
``At $192 an ounce, (costs) were the lowest in South Africa in that quarter,'' said Piet Stoltz, a gold analyst at BOE Securities in Johannesburg.
Profits were hurt by a 2 percent decline in the price of gold during the period. Gold sold for an average of $264 an ounce for the quarter, down from the previous quarter's average of $269. Production was also disrupted by a shutdown over the December holiday period.
``Our seasonal drop in production has been accompanied by continued tight cost control,'' Thompson said in a statement.
The earnings were better than the average estimate of 54 cents a share, according to a Bloomberg survey of four analysts.
Gold Fields shares rose as much as 90 cents, or 2.6 percent, to 35.4 rand in Johannesburg, where they are up 37 percent this year.
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