Integrated Annual Report for the Year Ended 31 December 2014
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2014 Integrated Annual Report for the year ended 31 December Gold Fields Integrated Annual Report 2014 Gold Fields Integrated Annual Report About Gold Fields Gold Fields Limited is an unhedged, globally diversified producer of gold with eight operating mines in Australia, Ghana, Peru and South Africa. In February 2013, Gold Fields unbundled its mature underground Beatrix and KDC mines in South Africa into an independent and separately listed company, Sibanye Gold Limited. It also expanded its presence in Australia, acquiring the Darlot, Granny Smith and Lawlers mines (known as the Yilgarn South Assets) from Barrick Gold in October 2013. Gold Fields has attributable annual gold production of approximately 2.2 million ounces, as well as attributable Mineral Reserves of around 48 million ounces and Mineral Resources of around 108 million ounces. Attributable copper Mineral Reserves total 620 million pounds and Mineral Resources 1,001 million pounds. Gold Fields has a primary listing on the JSE Limited, with secondary listings on the New York Stock Exchange (NYSE), NASDAQ Dubai Limited (NYX) and the Swiss Exchange (SWX). COVER PICTURES The processing plant at Gold Fields’ Granny Smith mine in Western Australia Revegetation of the tailings dam at Gold Fields’ South Deep mine in South Africa Contents INTRODUCTION IFC About this report IFC About Gold Fields IFC 1 OUR BUSINESS 1 1.1 Our DNA 2 1.2 Our global footprint – 2014 in perspective 4 1.2 Our business model 9 2 LEADERSHIP AND PERFORMANCE 12 2.1 Vision of the Chairperson 14 2.2 CEO report 18 2.3 CFO report 28 2.4 Corporate governance 32 2.5 Summarised remuneration report 37 3 STRATEGIC ANALYSIS 40 3.1 Strategic trends 42 3.2 Risk and materiality 47 4 OPTIMISING OUR OPERATIONS 54 4.1 Ensuring our mines deliver 56 4.2 Pursuing zero harm 67 4.3 Promoting environmental stewardship 72 5 GROWING GOLD FIELDS 78 5.1 Redefining growth 80 5.2 An integrated approach to growth 82 5.3 Near-mine exploration performance 84 5.4 Update on remaining growth projects 88 5.5 Mineral Resource and Mineral Reserve Statement 90 6 SECURING OUR FUTURE RESPONSIBLY 96 6.1 Gold Fields as an employer of choice 98 6.2 Government and social relations 102 6.3 Community relations 108 7 ASSURANCE 116 7.1 First party: Internal Audit statement 118 7.2 Independent Assurance Report to the Directors of 119 Gold Fields Limited 7.3 Assured data 123 Administration and corporate information 125 INTRODUCTION About this report Our 2014 Integrated Annual Report comprises the Lawlers operations were combined in Q4 2013 following three volumes: and it is therefore not possible to separate out the data for the Yilgarn South Assets in 2014 to • The Integrated Annual Report (IAR) 2014, allow for a year-on-year comparison with 2013. which examines the integrated nature of Furthermore, all 2012 data, where stated, cover our operational, financial and sustainability only the continued operations of Gold Fields, i.e. Integrated Annual Report for the year ended 31 December 2014 performance they exclude the contributions from the Sibanye • The Annual Financial Report 2014, which fulfils Gold assets. This report has been compiled in our statutory financial reporting requirements accordance with the GRI’s G4 Guidelines and • The Mineral Resources and Mineral Reserves the International Integrated Reporting Council Overview 2014, which provides detailed <IR> Framework. Gold Fields also references technical and operational information on our a broad range of additional codes, frameworks mines and growth projects and standards in compiling the report, the full list of which can be found on p48. We believe the The aim of our integrated approach is to enable Integrated Annual Report, together with additional investors and other stakeholders to make a more documents held online, complies with the GRI G4 informed assessment of the value of Gold Fields Core Reporting Guidelines. and its prospects. The IAR also forms part of our Annual Financial Report Communication on Progress to the United Nations for the year ended 31 December 2014 An average exchange rate for 2014 of R10.82 and Global Compact. A summary of our adherence A$1.11 to the US$ have been used in this report. to the Global Reporting Initiative (GRI), the 10 Principles of the United Nations Global Compact Assurance and the 10 Principles of the International Council on Mining & Metals (ICMM) and its mandatory Our auditors, KPMG, have provided reasonable requirements of the position statements are assurance on selected sustainability information in presented online. this report, which is prepared in accordance with the G4 guidelines. As a member of the ICMM we Forward looking statements are committed to obtaining assurance in line with the ICMM Sustainable Development Framework: Gold Fields’ forward looking statements which Assurance Procedure. KPMG has provided apply to this Integrated Annual Report, can be assurance on the four subject matters of the ICMM Mineral Resource and Mineral Reserve found on our website at www.goldfields.com. Supplement to the Integrated Annual Report for the year ended 31 December 2014 (ICMM subject matter 5 is not applicable due to Scope and boundaries of this report Gold Fields’ transition to GRI G4 Core). The key sustainability performance data for assurance by This is Gold Fields’ 2014 Integrated Annual KPMG in 2014 can be found on p123 – 124. Report. It covers the reporting period from 1 January 2014 to 31 December 2014. Board approval The previous IAR was published in March 2014 The Gold Fields Board of Directors considers and covered the financial reporting period from that this Integrated Annual Report complies in 1 January 2013 to 31 December 2013. all material respects with the relevant statutory This Integrated Annual Report provides an requirements of the various regulations governing overview of Gold Fields’ eight global operations disclosure and reporting by Gold Fields and in Australia, Ghana, Peru and South Africa, as that the annual financial statements comply well as our exploration and business development in all material respects with the South African activities. Detail on the exact location of each Companies Act No 71 of 2008, as amended, operation can be found on the global map on as well as with International Financial Reporting p4 – 5, while growth and exploration projects can Standards. As such, the Board approves the be found on page 89. content of the Integrated Annual Report 2014, including the Annual Financial Report 2014. We use an integrated approach to reporting that examines our operational, financial and sustainability performance. All non-financial data for 2013 exclude the newly-acquired Yilgarn South Assets, unless otherwise indicated. All 2014 non- financial data are inclusive of the Yilgarn South Cheryl Carolus Assets. The existing Agnew and newly acquired Chairperson of the Board 23 March 2015 The Gold Fields Integrated Annual Report 2014 1 1 Tailings storage facility at Cerro Corona in Peru 1.1 Our DNA 2 1.2 Our global footprint 4 1.3 Annual performance dashboard 6 1.4 Our business model 9 The Gold Fields Integrated Annual Report 2014 2 INTRODUCTION INTRODUCTION 3 1.1 Our DNA OUR STRATEGIC OUR STRATEGIC OUR COMMITMENTS PILLARS PRIORITIES TO STAKEHOLDERS • Safe and productive teams • Cost discipline in support of sustainable cash generation Focus on a 15% free cash • No marginal mining – not flow margin at Employee Charter “ounces for ounces’ sake” a gold price of US$1,300/oz • To structure our business such • To be a company of which employees can be proud that the Group will generate a • To celebrate achievement 15% free cash flow margin at a gold price of US$1,300/oz Proactive • To treat employees with respect and to work with them to ensure portfolio their health and safety • A dividend-first policy – we pay ence management – • To provide the right development and support for employees out 25% to 35% of normalised ell clean up portfolio Operational excellence xc earnings l e and divest non- to succeed a core assets on • With employees’ help, to make Gold Fields the best place to work ti GIC ra ATE OB e TR JE p S C T Growth O R A safe, winning and productive team IV through U E O VALU value accretive • Prioritisation of low-risk, high- UR ES acquisitions and y S O near-mine return assets r s a e exploration f d v e • Assets in regions where we l i l e t VIS y already have a presence i R IO e F U N D Investor Charter • Growth of reserves per share O d H l and cash flow per ounce and o o To be the n Strengthen the • To build a quality portfolio of productive mines per share n o G balance sheet by i e global leader in t • To provide superior returns g reducing debt • Prioritisation of cash flow, S s a n u t sustainable gold i v profitability and return on y n • To deliver on our commitments s o investment – not ounces w mining o t n i o a t r R n Growing Gold Fields i I • Active portfolio management n e u G s b A quality portfolio of assets, providing “backing only franchise a p i b ty r Pay dividends assets” l e li t e ct i s of between superior returns on gold sib i c Respon d 25% and 35% a e s u of normalised e h l r g a earnings u v t en n u e i f r p a er r tion und • Attraction and retention of u to o critical employees g n i Society and Community Charter r u c e • Employee development S Deliver South Deep • To build strong relationships and trust • Employee health • To create and share value • Shared Value • To measure our actions and impact • Stakeholder relations • To deliver against our commitments •