FY 2016 Results REINVESTING FOR THE FUTURE 16 February 2017 - PowerPoint PPT Presentation

FY 2016 Results REINVESTING FOR THE FUTURE 16 February 2017

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 among others those relating to the Damang Exploration Target Statement; the Far Southeast Exploration Target Statement; commodity prices; demand for gold and other metals and minerals; interest rate expectations; exploration and production costs; levels of expected production; Gold Fields’ growth pipeline; levels and expected benefits of current and planned capital expenditures; future reserve, resource and other mineralisation levels; and the extent of cost efficiencies and savings to be achieved. Such forward looking statements involve known and unknown risks, uncertainties and other important factors that could cause the actual results, performance or achievements of the company to be materially different from the future results, performance or achievements expressed or implied by such forward looking statements. Such risks, uncertainties and other important factors include among others: economic, business and political conditions in South Africa, Ghana, Australia, Peru and elsewhere; the ability to achieve anticipated efficiencies and other cost savings in connection with past and future acquisitions, exploration and development activities; decreases in the market price of gold and/or copper; hazards associated with underground and surface gold mining; labour disruptions; availability terms and deployment of capital or credit; changes in government regulations, particularly taxation and environmental regulations; and new legislation affecting mining and mineral rights; changes in exchange rates; currency devaluations; the availability and cost of raw and finished materials; the cost of energy and water; inflation and other macro-economic factors, industrial action, temporary stoppages of mines for safety and unplanned maintenance reasons; and the impact of the AIDS and other occupational health risks experienced by Gold Fields’ employees. These forward looking statements speak only as of the date of this document. Gold Fields undertakes no obligation to update publicly or release any revisions to these forward looking statements to reflect events or circumstances after the date of this document or to reflect the occurrence of unanticipated events. Reinvesting for the future, FY 2016 results, 16 February 2017 2

FY 2016 results Salient features FY 2016 FY 2015 Q4 2016 Q3 2016 Attributable gold equivalent production (koz) 2,146 2,159 566 537 All-in costs (US$/oz) 1,006 1,026 941 1,038 Net cash from operating activities (US$m) 294 123 Normalised earnings (US$m) 191 45 Normalised earnings (US$/share) 24 6 Dividend (SA cents/share) 110 25 Net debt (US$m) 1,166 1,380 Net debt to EBITDA (x) 0.95 1.38 2017 Group guidance ● Attributable equivalent gold production: 2.10Moz – 2.15Moz ● AISC: US$1,010/oz – US$1,030/oz ● AIC: US$1,170/oz – US$1,190/oz (includes US$20m for South Deep, US$120m for Damang, US$112m for Gruyere and US$64m for Salares Norte) Reinvesting for the future, FY 2016 results, 16 February 2017 3

Progress against strategic objectives Committed to Stick to Grow cash flow delivering on dividend policy Continue to Continue to Deliver a and margin with our plans in of paying out evaluate value- reduce net sustainable terms of both 25% - 35% of accretive an increase in debt South Deep production and normalised opportunities the gold price costs earnings 2016 mine Damang operating cash reinvestment flow of Achieved net and Gruyere US$444m debt/EBITDA of Have beaten Beat updated enhance (US$208/oz); Dividend has 0.95x (below both production guidance and portfolio – on a FCF averaged 30% target of 1.0x) and cost achieved cash pro forma basis of normalised at end-2016 margin:17% vs. breakeven (net guidance AIC for 12 2015 mine earnings over after taking into for four cash inflow of months to operating cash the past five account upfront consecutive US$12m) in December 2016 flow of years A$250m years 2016 would decrease US$254m Gruyere from payment (US$118/oz); US$1,006/oz to FCF margin: US$940/oz 8% Committed to deliver on strategic objectives Reinvesting for the future, FY 2016 results, 16 February 2017 4

Strong focus on cash generation Net cash flow 2013 2014 2015 2016 250 2,000 Gold: US$1,249/oz Gold: US$1,140/oz Gold: US$1,241/oz Gold: US$1,386/oz Net cash: US$236m Net cash: US$123m Net cash: US$294m Net cash: (US$232m) 200 1,500 1,625 1,329 1,242 1,198 1,182 1,103 1,092 150 1,372 1,315 1,283 1,275 1,265 1,265 1,179 1,198 1,000 1,174 152 100 82 75 65 63 54 54 47 500 38 50 34 30 26 US$ million 4 US$/oz 0 0 -29 -50 -45 -500 -100 -1,000 -150 -1,500 -200 -229 -250 -2,000 Q1 2013 Q2 2013 Q3 2013 Q4 2013 Q1 2014 Q2 2014 Q3 2014 Q4 2014 Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016 Q3 2016 Q4 2016 Net cash flow Gold price Net cash flow = Cash flow from operating activities (which is net of tax) less net capital expenditure, environmental payments and financing costs US$294m net cash flow from operating activities generated in 2016 Reinvesting for the future, FY 2016 results, 16 February 2017 5

Comfortable balance sheet, with flexibility ● Net debt of US$1,166m at 31 December 2016 Net debt (US$m) and Net debt/EBITDA 2,000 1.8 ● Net debt to EBITDA of 0.95x at end-2016 from 1.38x at end-FY15 1.6 1,500 1.4 ● First material debt maturity in June 2019 US$m 1,000 1.2 (previously November 2017) 500 1.0 ● Unutilised facilities of US$872m and R2.3bn 0 0.8 FY H1 FY H1 FY H1 FY 2013 2014 2014 2015 2015 2016 2016 Net debt Net debt/EBITDA Debt facilities Maturity schedule 3,000 900 800 2,500 700 2,000 600 US$m 1,500 US$m 500 1,000 400 300 500 200 0 100 US$ facilities Rand facilities Total facilities 0 Utilised Unutilised Dec-17 Dec-18 Dec-19 Dec-20 c.US$700m reduction in net debt since end-FY13 Reinvesting for the future, FY 2016 results, 16 February 2017 6

Dividends increase with earnings ● We have consistently paid dividends on a semi-annually basis since H2 2013 ● We maintain our dividend policy of paying 25% - 35% of normalised earnings ̵ 2016 payout ratio of 32% Dividend per share (Rc) and % payout Dividend yield 120 40% 2.0% 35% 1.8% 100 1.6% 30% 80 1.4% 25% 1.2% 60 20% 1.0% 15% 40 0.8% 10% 20 0.6% 5% 0.4% 0 0% 0.2% 2013 2014 2015 2016 0.0% Div per share % payout 2013 2014 2015 2016 Maintaining dividend policy of paying out 25% to 35% of normalised earnings Reinvesting for the future, FY 2016 results, 16 February 2017 7

Gold Fields’ M&A strategy Quality : ● The main objective underpinning Asset must Gold Fields’ strategy is to generate improve Group AIC and sustainable cash flow generate a 15% FCF margin at US$1,300/oz ̵ To continue expanding margins and Jurisdiction : distributing cash, the long-term Scale : Asset must be Asset must sustainability of the business must be located in a produce a geography that kept intact minimum of Gold Fields is US$40m in FCF comfortable to per annum ● Value-accretive M&A is a key operate in Acquisition target criteria element to the Group’s strategy ● The Damang reinvestment and Gruyere acquisition add life of mine Life : and improve the quality of our Asset must In-production : increase our portfolio Asset must be in overall reserve production and life per operation; ● The focus in 2017 is on bedding cash generative minimum of eight years of reserve down these investments life Investing in sustainable free cash flow generation Reinvesting for the future, FY 2016 results, 16 February 2017 8

Damang pit, Ghana Gruyere, Western Australia Salares Norte, Chile South Deep, South Africa Investing for the future

Investing to sustain free cash flow for the long-term ● In order to sustain and grow free cash flow, investment is necessary ● Focus is on reinvesting in the business to ensure sustainable free cash flow ● Only embark on investments and capital expenditure with excellent potential for paybacks and returns and which upgrade the quality of our portfolio ● Key investment initiatives underway in 2017: ̵ Damang reinvestment: Extends Damang’s LOM by eight years ̵ Gruyere JV: Adds life and lowers Group AIC when at steady state ̵ Brownfields exploration in Australia: Yielding encouraging results ̵ Drilling and study expenditure at Salares Norte: Results of PFS expected in H2 2017 ̵ South Deep: Rebase plan announced – steady state production of 500koz, with AIC below US$900/oz Securing the future Reinvesting for the future, FY 2016 results, 16 February 2017 10