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Executives

Nicholas John Holland - Chief Executive Officer and Executive Director

Paul A. Schmidt - Chief Financial Officer and Executive Director

Analysts

Tanya Jakusconek - Scotiabank Global Banking and Market, Research Division

Unknown Analyst

Joung Park - Morningstar Inc., Research Division

Gold Fields (GFI) Q4 2011 Earnings Call February 17, 2012 9:00 AM ET

Operator

Good day, and welcome to the Gold Fields Q4 Results Conference. [Operator Instructions] Please also note that this conference is being recorded. I would now like to hand the conference over to Nick Holland. Please go ahead, sir.

Nicholas John Holland

Thank you very much, and good morning, everyone, depending on where you are; and good afternoon for those people who are in the same time zone as us here in Johannesburg, South Africa. Thanks for joining me on this call to discuss our results for the quarter ended December and to give you some brief highlights of the year-end results as well. And joining me on this call is our CFO, Paul Schmidt; and also, Zakira Amra, our Senior Vice President of Investor Relations and Corporate Affairs.

I trust you've now had an opportunity to review our results announcement, which was released on SENS and our website this morning, and some of you may have had a chance to view the webcast. As with previous calls, I'm just going to give you some salient features of our results and then leave most of the time for questions.

Just dealing, first of all, with the quarter ended December. We've managed to produce 883,000 attributable ounces. That was marginally lower than the 900,000 ounces we produced in the September quarter. A couple of reasons for that small downward adjustment. First of all, we do report gold equivalent ounces. And in Cerro Corona, we lost about 10,000 equivalent ounces because of the copper-gold price ratio that changed. The underlying physicals were very good, but that was just the ratio of copper versus gold. So it was 10,000 ounces that declined there. We also lost about another 10,000 ounces. We didn't lose it, obviously, it's deferred. But 10,000 ounces lower for Tarkwa, which encountered principally some harder ores, which meant that the milling rate through the carbon in leach plant was slightly lower than the previous quarter at about 1,350 tons per hour instead of 1,450 tons per hour. The good news is that we did see this coming. This is not a surprise for us, and we've recently commissioned a new secondary crusher in front of the carbon in leach plant, which will enable us to increase our throughput as it will enable us also to grind the materials to the required grind and get that through the plant. And those were the 2 principal reasons behind the marginal decrease in production.

The South Africa region showed a small increase. The Australasia region also showed a small increase, and this helped to offset some of the declines that we saw in both Ghana and in Peru.

Looking on our cash costs. Cash costs for the quarter declined to $767 an ounce from $851 an ounce in the previous quarter. That's a 10% reduction. The rand exchange rates did help, which weakened to ZAR 8.08 for the quarter compared to ZAR 7.05 for the previous quarter. That did help. But not just the rand depreciation. We were also assisted by good control over our costs, and we've managed to, in fact, reduce our costs across most of the operations during the last quarter. So the combination of those 2 issues, the slightly weaker rand and improved cost control enabled us to improve our operating profit from $804 million in the September quarter to $877 million in the December quarter.

Net earnings for the quarter increased from $293 million in September to $336 million in the December quarter. We also declared a dividend during the quarter, and that was ZAR 2.30, which translates to about USD $0.29, and that brings our total dividend to the year of ZAR 3.30 or around about USD $0.45 for the year, which we understand puts us on a dividend yield of around about 2.5%. And I may be mistaken, but I think this places us right at the top of the gold sector in terms of dividend yields.

Payout ratios are pretty much in line with the policy. We say that we want to pay out 50% of our earnings subject to deducting growth capital, and that's in line. But if you look at the historical trend of our dividend payouts to our earnings over the last 5 years, we are somewhere around about 35%, around about 1/3 on average of our earnings over the last 5 years have been paid out. That's our reported earnings prior to adjustments, so. But we're pleased to be able to, first of all, show the improved gold price in the bottom line and then to also reflect that in higher dividends for shareholders. And in fact, we've been able to more than double our dividend compared to the previous year. So that's really helped us. And some might say, "Well, these earnings are just because of the gold price." But what's really interesting is that over the last number of years, if you take 2008, for example, to 2011, there's been a 81% increase in the gold price over that period. But over the same period, we've increased our EBITDA by 124%, we've increased our operating cash flow by 114% and our earnings by 169%. So we have, in fact, shown more than just the increase in the gold price and our earnings; we've, in fact, been able to expand our margin. And hence, this whole concept of notional cash expenditure that I've been preaching about for the last 4 years is so important because that is the best proxy for determining whether you make cash. If you can't make any cash flow after capital expenditure, then you should be worried about the business, even though NCE might be chunky from time to time as you do certain projects.

Just turning briefly for the year as a whole, our attributable production for the year was 3.49 million ounces. That's broadly in line with the guidance we've given at the beginning of the year and also very similar to the previous year. We've had a 48% increase in operating profit to $2.9 billion and a 49% increase in our free cash flow from operations to $751 million.

Our NCE margin over the year-on-year increased from 16% in 2010 to 25% in 2011. Now a very important metric is to look at the NCE margin per ounce. In other words, how much did we make per ounce of production after taking into account operating costs and capital expenditure. And in fact, we increased that margin from $201 per ounce in 2010 to $396 per ounce in 2011. And that shows you the tremendous gearing effect that the increase in the gold price over that period -- that's a 29% increase in the gold price -- has had on the overall NCE margin.

Earnings went up 536% in 2011 compared to 2010. And we made just shy of $1 billion. $973 million of earnings was generated by Gold Fields for 2011. So it's been an outstanding year for us in terms of leveraging off the gold price, and it's also been an outstanding year for us in terms of pushing along our project portfolio.

And we continue to make progress on our growth, and we're in the process of developing an extensive pipeline of projects, which will bring us closer to our target of achieving 5 million ounces per annum either in production or in development by the end of 2015. The Chucapaca feasibility study in South America is on track to be complete this year, and we anticipate that we'll be able to submit the environmental impact assessment during the second half of 2012. We also completed the drilling to confirm and test the limits of mineralization of the Far Southeast project in the Philippines in October, and follow-up exploration has commenced. We're in the -- we are currently involved in a decision on whether to not to make the final payment for our 60% option in the project, and that's expected around about the middle of 2012. And that's contingent, by and large, on getting the FTAA process, which is the license allowing foreigners to own a majority interest in the project. We expect that's going to be granted in the second half of this year, and then thereafter, we'll be in a position to exercise the option to pay the remaining balance of $220 million and take up our 60% stake.

Also finalized last year was the Damang -- sorry, we're also in the process of completing the Damang Super Pit pre-feasibility study in West Africa, and we expect to complete that exercise in the middle of 2012. And with that, we also expect to have a resource, initial resource, for the upgraded project as well as a reserve for the project.

Pre-feasibility study of the Arctic Platinum project is continuing, with a focus on reengineering the project and also identifying additional opportunities to add more material into the study.

So those are the main highlights that I wanted to mention on the project side on sustainable development. We were ranked fourth in the mining industry in the 2011 Dow Jones Sustainability Index, making us the top South African-listed mining company on the DJSI. And for our debut participation in this index, that's been a great achievement for us. And we also ranked first in the JSE Top 100. That's the Johannesburg Stock Exchange Top 100 Carbon Disclosure Leadership Index of the Global Carbon Disclosure Project.

I think that's enough for me for the moment. And I'd like now to open the lines for any questions, and either myself or Paul will endeavor to answer these questions as you put them to us. Thank you very much, Dylan.

Operator

[Operator Instructions] Our first question comes from Tanya Jakusconek of Deutsche Bank (sic) [Scotiabank].

Tanya Jakusconek - Scotiabank Global Banking and Market, Research Division

It's Tanya from Scotiabank. I just wanted to ask a few questions. I know you probably have already reviewed this earlier. But can we talk about the Far East project? You mentioned that you have -- you're going to be looking at exercising your right in the second half. Is there anything that you're seeing in the project itself that would make you not exercise it? Or is it really contingent on getting this FTAA? And then maybe just talk a little bit about what has been happening there. And then my second question is on Arctic Platinum and maybe an update there in terms of the network. And then the third one that I wanted to get an update on was on the tailings projects in South Africa.

Nicholas John Holland

Okay, good. Those are 3 excellent questions. Certainly, in the project so far in Far Southeast in the Philippines, we are very excited about what we've seen so far. We finished a 17-hole sort of scope-drill program, concept scope drilling, if you like, to augment the 88 holes historically that have been drilled into the ore body by previous players. And we're putting that all together, and we are hoping, at the same time, of announcing that we have exercised the option and taken a 60% stake to also get a maiden resource. And we're looking to package all of this into the second half once the FTAA agreement is in place. We mentioned also in our Analyst Day on December 5 in Johannesburg and December 7 in New York that we were targeting around about 50 million ounces, and that's comprised of about 900 million tons at about 0.8 grams a ton gold and about 0.5% copper. The deposit is still open in all directions. So we've got nothing to suggest that we're not going to at least achieve that. Now the next step in the program, Tanya, is for us to commence another drilling program, and a lot of this will be infill to improve the resolution of what we've already got that will support the maiden resource declaration, and also to do some geotech drilling into the ore body itself, which will be important. And then doing some work around now where would we put the plant, ventilation shafts, declines, et cetera. So we're doing all of that work behind the scenes. But as I sit here today, this remains one of the really significant projects in the copper-gold porphyry space. And if you look at the size and if you look at the grades and compare that to what's out there, this certainly ranks highly in our view. So I don't see any particular reason why we wouldn't go ahead and exercise the option. I think it's largely process-driven. And once we've done that, we’d want to get into a pre-feasibility study -- in fact, I believe we'll start the pre-feasibility study even earlier than that as a measure of our confidence on where this particular project is going. Is there anymore on that before I move on?

Tanya Jakusconek - Scotiabank Global Banking and Market, Research Division

I do have a question. Just on the resource that's going to be announced, it will be in the inferred category, all of these resources? And sort of how many holes would we have this resource based on? Just the 17 plus the 88 holes that were previously there?

Nicholas John Holland

No, we're going to be doing more drilling between now and when we do the declaration. We're probably going to do another 20 or 30 holes into the ore body. I suspect that we'll only get this to inferred category to begin with, and then we'll graduate it up to indicated thereafter.

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Tanya Jakusconek - Scotiabank Global Banking and Market, Research Division

Okay.

Nicholas John Holland

Good. Then moving to APP. We have, of course, finished the pilot plant test work that we've done on the Ahmavaara and Konttijarvi ore bodies. If you can recall, we've said we're going to take a 50-ton cut out of each of those ore bodies and put it through the entire process. We replicated the entire downstream Platsol facility, and the results have confirmed that we can significantly upgrade the recoveries by putting the Platsol process in place, which, if you can recall, is really an auto play of whereby we introduce irons into -- core rod irons into the system early on. We separate out the PGMs, then we capture the copper and the cap load and then we take out the nickel thereafter. So we've replicated that on a small-scale plant basis. It works. Now what we're going to be doing is looking at whether we can add more bulk to the project, because Konttijarvi and Ahmavaara will add about 130 million tons, but we believe that there's a potential to add possibly up to 100 million tons extra by looking at the Suhanko North ore body as well, which is in close proximity on our lease. We're doing a 40,000-meter drill program on that. We've already started that and we're about halfway through, and the signs are very encouraging that we should be able to bulk up this project even further by adding that in. The second step will be once we've drilled all the core is to test all of that also for Platsol. We'll do amenability tests on that, and then we'll reconfigure and complete the pre-feasibility study, and we intend to do all of these activities and finish them by the end of 2012.

Tanya Jakusconek - Scotiabank Global Banking and Market, Research Division

Okay. And now who's doing all of this met work?

Nicholas John Holland

Well, we're doing it, obviously, with the assistance of people like Lakefield, SGS Lakefield. Can I move on to tailings?

Tanya Jakusconek - Scotiabank Global Banking and Market, Research Division

Yes.

Nicholas John Holland

Right. So tailings, we put a slide in the presentation today, and it's Slide #17, that I think answers questions I know that you've had before on what is the opportunity here. And this gives you an idea of the inventory. Now this is not a declared resource or a reserve at this point in time. This is an inventory, and we've split into what we call "active and dormant tails dams" as well as the surface rock dumps that exist on each of KDC East and West. And as we've indicated previously, there's just under 5 million ounces available here. The grades in the tails dams are about 0.35 grams. The grades in the rock dumps are about 0.7 grams a ton. So we're doing 2 things on this. First of all, we're looking to get some additional mobile plants in the so-called Pythons that we've spoken about, which is a much smaller footprint that actually crushes the rock and takes it through to an actual leach solution but on a much smaller footprint at lower cost. We've got one operating at the moment, we've got another 2 on order that should be arriving during the year. We should have all 3 of those operating by the end of the year. And because now we have diverted rock dumps into these plants, or we will be doing so on an incremental basis, we're going to be taking the tails selectively, the higher grade tails first, and putting them into our plants. And we don't need to do that much configuration to do it, because a lot of it can bypass the comminution section. In fact, about 2/3 can go straight through into leach, and about 1/3 would have to go through comminution with regrinding then back into leach. We've started doing that on a test basis. In fact, we've been doing it for the last 6 months. And so far, the results are positive. It looks like it can work. And in fact, surprisingly the recoveries are looking even better than what we thought they would. Now all of this is going to culminate, Tanya, into a detailed feasibility study that we'll put in place, and we anticipate finishing that work sometime in the second half of this year. Now this would only, of course, capture the gold in the tails and we've got the uranium. There's a parallel process going on with Gold One, and we signed a memorandum of understanding with them, whereby what we've agreed to do is to give them all of the feasibility study work that we did when we were looking at actually building a process plant itself to capture the uranium and the gold. And we've given them that. They are going to look at that in conjunction with what they've got. And why it's particularly interesting to work with them is that they have also completed the acquisition of Rand Uranium, which in of itself has some interesting uranium opportunities, some very high-grade uranium opportunities. They've also got an existing plant, which of course, wouldn't necessarily be the right size to get the right milling rate, but it could be a starter project, which we might be able to expand on a modular basis. So what Gold One and ourselves are doing is looking at a range of options, and we'll come up with an initial concept study, if you like, by the middle of the year and then we'll decide how best to go forward. We don't know yet what the economics are going to be, how we're going to share the economics, how we're going to share the capital, who’s going to run it. All of that is up for debate. I am reasonably flexible in all of those things. What's more important here is how we can extract value from this project, and I think this could be a very interesting way of offsetting some of the declines we've seen over the last number of years in the South African gold industry, and in particular, in the Gold Fields' legacy assets.

Tanya Jakusconek - Scotiabank Global Banking and Market, Research Division

And conceptually, what recoveries have you been getting? And conceptually -- sorry, when could you see this actually contributing to production for the time line-wise?

Nicholas John Holland

Yes. If we go it alone and just capture the gold, I think we'll see this starting to impact production by the end of the year, quarter 4, we'll see some of the benefits coming through. Quarter 1 next year, we'll probably ramp up fully. So far, recoveries are around about 70% to 80%, which is a bit higher than what I thought they might be. I thought they might be down to sort of 65% to 70%. That's on the tails. And on the rock dumps, we're getting recoveries of around about 80%, 85%. So it looks interesting. The costs are certainly cheaper than running it through a conventional plant. That's on the mobile plants. Probably around about $7 to $8 a ton versus maybe $9 to $10 a ton through the plant, so it's about 20% to 25% cheaper. So the signs are very encouraging, and with the rand gold price being above ZAR 400,000, and all of the stuff being on surface, it's going to be pretty safe to mine it. What we're going to do is reprocess it. And I think it's all about bulk. We've got to bulk up this project, Tanya, to really get the economies of scale and drive that through the unit costs.

Operator

Our next question comes from Mark Pampa [ph] of Meek [ph].

Unknown Analyst

Just you'd suggested in your New York investor meetings that you would be pursuing registration, which would be applicable to some of your existing bond issues. Can you report on any progress on that front?

Paul A. Schmidt

It's Paul. Yes, we are still considering all our options regarding whether we want to register bond. And we’ve just started the process, and we're weighing out the positives and the negatives and we'll probably know in the next few months.

Operator

[Operator Instructions] Our next question comes from Jeffco Motifaf [ph] of Standard Pacific Capital.

Unknown Analyst

This is Jeffco [ph]. A couple of questions; I actually dialed in a couple of minutes late, so if you have addressed it, please excuse me. But if you could talk briefly about dividend policy and cash use, cash distribution priorities there, that would be very helpful. That's the first question. And the second question, on the South African operations, we've had a very favorable environment with the rand gold price hovering around ZAR 420. It's clearly very positive from earnings perspective, and we've seen it in the results. But I was wondering if you can maybe quickly discuss some of the strategic opportunities that this environment presents to you in terms of maybe asset utilizations or optionality or cash use, something that's not entirely obvious looking at the income statement. So these are my 2 questions, please.

Nicholas John Holland

Jeffco [ph], what I'll do is I'll ask Paul Schmidt to answer your question on the dividend policy and use of cash, and then I'll come back to the strategic options on South Africa, if we may.

Paul A. Schmidt

Our dividend policy is clear, and this final dividend that we paid was right in line with our dividend policy. And to just to repeat, our dividend policy is to pay 50% of earnings after deducting growth capital. And for the last year, the only growth capital we deducted was South Deep and our share of the Chucapaca project. And we consider, for the foreseeable future, I will stick to my dividend policy. And the balance of the cash, obviously, we've got a big growth profile coming down the line. We will utilize excess cash for that, but we will still pay our dividend in terms of the policy. I hope that answers your question.

Nicholas John Holland

Okay. And then on the second question, Jeffco [ph], obviously, the South African assets, as you mentioned, are now making some good cash flow. And strategically, I think it's quite important that we recognize that, that cash flow can be used for 2 purposes. It can be used, first of all, to achieve higher dividends for shareholders, reflecting the higher price because of the significant leverage that these assets have. But also, it can help to fund the international pipeline. And the one thing that, if you look at Gold Fields over the last 13 years, we've grown the international production from 0 to 2 million ounces a year without issuing a single share. That's been really financed by the South African cash flow. Now obviously, we need to look at the longer term as well and what we think is possible. And there's a significant opportunity on the surface resources in South Africa in that we've got about 4.8 million ounces on surface, in tails, dams and in rock dumps, which we believe we can accelerate by increasing our processing capacity. And that could actually help us to increase production out of these South African operations. Now we're in the midst of ordering some additional processing equipment, which is probably going to cost us about ZAR 500 million over this year, and that will enable us to accelerate a lot of those surface resources. So we've got over 500 million tons, so there's no shortage of that. Plus ZAR 400,000, they make really good money. They even make money at around about ZAR 330,000 rand a kilogram. So there's a lot of headroom here. I mean, even if gold prices went down ZAR 100,000 a kilogram, this would still make very good money for us. Also, if we look at the KDC East property or what used to be called Kloof, there's a very high-grade area of about 4 million to 5 million ounces, which is about 2/3 of that ore body, which is around about 9 grams a ton. And we're mining at a much too slow a rate, we believe. And if we could debottleneck the shaft system by putting in some additional inter-levels, some additional ore passes, haulages, et cetera, we believe that we could accelerate that higher-grade production. So that's another strategic alternative that we're looking at as well. And with these sort of prices, it would give attractive returns for us, we believe. So that's some of the things that we're looking at on those assets. Beatrix and the Free State, I don't think we need to do too much because we've spent most of the capital on that operation, Jeffco [ph]. We've capitalized it fairly well over the last few years, we've finished the 3-shaft infrastructure, which is going to be the nucleus of future mining. And I think that can be a very useful cash cow. I think it's time now to recoup a lot of the investment we've made. It's also quite shallow. It's low risk in terms of seismicity and it's a very productive operation. Lower-grade but shallower, very productive, and I think it's a mine that can add significantly to the cash flow into the future. A lot safer as well, we don't have the same sort of safety risks there as we have had elsewhere in the Group. So that's really the core strategy for the moment. I don't know if there's any follow-up question on that, Jeffco [ph].

Unknown Analyst

No, that’s good.

Operator

Our next question comes from Joung Park of Morningstar.

Joung Park - Morningstar Inc., Research Division

So looking at the Far Southeast project, it looks like the exploration target has been increased to 900 million tons. So just wondering where those ounces came from and if you expect this body to grow even more.

Nicholas John Holland

Look, we discussed this in some detail in the Analyst Day in December last year and said that our target was to get to 52 million ounces, which translates to the 900 million tons. That's a target. And what we're saying is we haven't got that yet as a resource, but that by the second half of 2012, when we get a maiden resource, our view is that based on the drill information that historically has been there -- there’s 88 holes into the ore body -- and based on the 17 drill holes that we've done ourselves, we believe that there's a reasonable expectation that we can get our maiden resource somewhere in that area. It's still open in all directions. It's around a kilometer across, and it's about a kilometer down. But there's no indication yet that it's closed off mineralized areas, and it's going to get possibly bigger from here. And so that's the target we've put up. We haven't put out a resource yet, but we hope that by the time we put out our resource in the second half of the year that we'll be at or about that sort of level.

Joung Park - Morningstar Inc., Research Division

Okay, excellent. And then for South Africa, if we assume that there will be no further increases in electricity from Eskom and labor rates will stay at current [indiscernible] levels, then what do you think will be the percentage increase in cash costs for South Africa?

Nicholas John Holland

Well, we've actually given that -- we've given that in our guidance, in the book. If you look at our quarterly book on the -- which should be on the website, pretty sure it's on the website, if you look for that -- but let us help you out, KDC operations, we're looking at cash costs of around about $1,000 per ounce for next year, which takes into account a 28% increase in electricity and also takes into account the second year of the wage deal...

Paul A. Schmidt

So $946.

Nicholas John Holland

Which is around about 8% to 9%. So that's up from about $946 for the year end of 2011 to $1,000 an ounce in 2012. If we look at Beatrix, we're looking at around about $9.60 per ounce, again including and not excluding, as you suggested, but including the electricity increases, including the wage increases, $960, and that's up from -- that's pretty flat, which will be a good achievement for next year. So based on our gold price of $1,750, you're still looking at sizable operating margins from both of these assets for next year even after taking into account the increased cost that inevitably will come through. Obviously, we'll try and offset some of that, but I think we're trying to give you what we see as the worst-case scenario here.

Operator

We have a follow-up question from Tanya Jakusconek.

Tanya Jakusconek - Scotiabank Global Banking and Market, Research Division

I just wanted to have 2 more questions, if I could. Chucapaca, can we -- Nick, can you give us an indication of what you're expecting your program to be focused for in 2012 on the property, whether the aim is more to extend the known resource or is it infill or -- just the program there. And then my second question is on your reserves and your resources. I know that will come out with your annual. But just an indication of what you've been seeing, whether we're looking at replacing, et cetera, this year?

Nicholas John Holland

Okay. Look on Chucapaca, we've drilled out the ore body quite significantly. We've put 100,000 meters of drilling into Chucapaca. We've got 7.6 million ounces, and 70% of that is already in the indicated category. So I think we've got a high degree of resolution from the infill drilling. We want to be testing the extensions of the ore body. As you can recall, it's still open at depth and open to the west. So we're going to be doing some more drilling over there as well. But our big focus this year is going to be let’s get the feasibility study done. We want to finish that by the second half of this year and then hopefully, around about August, September. It's very important that we also get the environmental impact assessments application in, because that could have a 6- to 12-month time frame depending on how things go, so we've got to get that in. And by the end of this year, we want to be getting a development decision from our board on this particular project and from our joint venture partners, so that we can crack on and get this into construction during 2013 and try and get this into production by 2015. Now we mustn't, obviously, lose sight of the opportunities around the region and also around the potential to extend the ore body further to the west. So we'll be doing some other drilling in the area, we'll be testing some of the other targets around Chucapaca and there's a number of them that we'll be testing. Katrina and Katrina Este and a couple of others as well that look very interesting. So we'll be looking at that too in 2012. Because there's an indication, Tanya, that there could be a number of other diatremes in the area. In fact, the one diatreme is below a potential tails dam site, so we're going to be doing some condemnation drilling on that side as well to check that out. But a big area of focus has got to be to get this feasibility study done, get the EIA submitted and then get this to a point where we can reach a development decision by the end of this year.

Tanya Jakusconek - Scotiabank Global Banking and Market, Research Division

So I shouldn't be looking at a big jump in that resource of 7.6 by year end?

Nicholas John Holland

No, I don't think so. I think the main focus now is how we actually deliver that. But over time, I mean it's quite possible. Now whether it will optimize and if it's -- it's hardly unlikely if we find more, now because it's dipping about 14 degrees from east to west, if we find more it's probably not going to optimize in a pit shelf. So we have to look at the potential for underground. But we do want to consider that as well, but I think that will be run on a lower-level scale but in parallel with some of this work.

Tanya Jakusconek - Scotiabank Global Banking and Market, Research Division

Okay.

Nicholas John Holland

Second question?

Tanya Jakusconek - Scotiabank Global Banking and Market, Research Division

Yes. My second question was on the reserves and the resources.

Nicholas John Holland

Yes, yes, yes. Yes, an indication. Well, it's hard to give you an indication because the work is still in progress. So I think the best way for me to answer your question is to say watch this space, and we'll share it with you as soon as we can.

Tanya Jakusconek - Scotiabank Global Banking and Market, Research Division

And when will that be?

Nicholas John Holland

That will be by, I think, the end of March, possibly a little earlier but round about the end of March. I know that we are setting up an exploration presentation on the reserves and resources. I can't give you the exact date of that, but what I'll do is I'll get Willy to give you a call afterwards and let you know when that's likely to be.

Tanya Jakusconek - Scotiabank Global Banking and Market, Research Division

Okay. And then the $1,200 gold price, would that be fair in terms of your reserves and $1,500 for resources?

Nicholas John Holland

I think we're using $1,300 as the 3-year trailing average. We're working on the SEC guideline, $1,300 is the 3-year trailing average that we'll be using. And for resources, we're using about 10% higher, I think we're using $1,450 I seem to recall.

Operator

[Operator Instructions] Ladies and gentlemen, we have no further questions. Would you like to make some closing comments?

Nicholas John Holland

Well, thanks, everyone, for dialing in. And it's been, I think, a challenging year for Gold Fields, but at the end, it's also been satisfying in the sense that we've made almost $1 billion of earnings this last year, which I think does show that we've managed to realize the benefits of a higher gold price in the bottom line. We've also realized it in our cash flow, and we've also realized it in our dividends. And having a 2.5% dividend yield, I think, is very nice for a gold company. And I think you'll find that, that's right up there in any comparison with the senior tier group. And I look forward to seeing those of you who will be at the various conferences that we'll be at in the U.S. over the coming months. And with that, I wish you a good Friday and a wonderful weekend. Thank you and goodbye.

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Source: Gold Fields' CEO Discusses Q4 2011 Results - Earnings Call Transcript
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