Gold fields backs guidance but cites war-induced price rises
The miner said higher oil prices could hurt its ability to meet cost expectations.
Gold Fields backed its full-year guidance but said that higher oil prices could hurt its ability to meet cost expectations.
The South African gold miner said Thursday that since the conflict in the Middle East started, its diesel costs have increased by between 30% and 70% while liquefied-natural-gas prices are up by around 30%. The cost of explosives and freight are also up.
The conflict has upended global energy supplies and caused severe disruption to international shipping. Gold Fields said it has initiated cost saving measures but said that oil prices above $100 a barrel would put pressure on its ability to meet cost guidance.
Gold Fields also said progress on a $100 million share buyback plan has been limited due to high volatility in gold and equity prices due to the conflict. The company said that it continues to look for opportunities to buy back shares.
The group backed its all-in sustaining costs (AISC) guidance of between $1,800 an ounce and $2,000 an ounce.
The update came as the miner reported a 15% on-year rise in attributable gold-equivalent production of 633,000 ounces and a 13% rise in AISC to $1,829 an ounce.
Write to Adam Whittaker at adam.whittaker@wsj.com