Gold Fields of S.A. - Interim Results
20 January 1999 - 2:01AM
UK Regulatory
RNS No 3582e
GOLD FIELDS OF SOUTH AFRICA LIMITED
19th January 1999
Interim Report
GOLD FIELDS OF SOUTH AFRICA LIMITED
(Registration No. 05/04181/06)
Interim Report for the six months ended 31 December 1998
CONSOLIDATED INCOME STATEMENT
*Six months *Six months Year
ended ended ended
31 Dec 31 Dec 30 June
1998 1997 1998
Rm Rm Rm
Revenue
Income from investments 32 95 170
Interest received 50 52 87
Profit from zinc smelting 36 54 87
Surplus on realisation of
investments - - 1
Income from fees and other
sources 11 114 143
129 315 488
Expenditure and amounts
written off 59 143 252
Administration, technical and
general 49 91 173
Interest paid 10 19 38
Exploration and project
investigation - 33 41
Profit before tax and
exceptional gains 70 172 236
Exceptional gains 715 41 857
Profit before tax 785 213 1 093
Tax 28 32 59
Profit after tax 757 181 1 034
Minority shareholders' interest 46 30 44
Profit attributable
to ordinary shares 711 151 990
Includes depreciation charges 4 11 22
Earnings per share - cents 624 148 928
Headline earnings
per share - cents 20 107 128
Ordinary dividends
per share - cents 300 80 230
- absorbing - Rm 342 81 252
Dividends in specie
- absorbing - Rm 2 095 - -
*Unaudited
CONSOLIDATED BALANCE SHEET
*At *At At
31 Dec 31 Dec 30 June
1998 1997 1998
Rm Rm Rm
Fixed assets 93 167 141
Investments 370 2 431 4 875
Mineral properties 9 125 65
Loans advanced 103 364 188
Net current assets/(liabilities) 743 301 (130)
Current assets 1 242 566 508
Cash 1 056 277 290
Other 186 289 218
Current liabilities 499 265 638
1 318 3 388 5 139
Share capital 493 1 252 2 560
Reserves 627 1 687 2 350
1 120 2 939 4 910
Deferred tax 8 8 8
Minority shareholders'
interest 190 225 221
Loans received - 216 -
1 318 3 388 5 139
Investments
Total book value of investments 444 2 505 4 949
Listed - book value 444 2 316 4 884
- market value 657 8 768 8 405
- excess over book value 213 6 452 3 521
Unlisted - book value - 189 65
- directors' valuation - 2 024 164
- excess over book value - 1 835 99
Provision for diminution in
value 74 74 74
370 2 431 4 875
Commitments and contingent
liabilities - 2 32
Number of ordinary shares
in issue 114 075 385 101 680 054 113 924 903
Net assets (as valued) per
share - cents 1 269 10 972 7 448
*Unaudited
NOTES:
1. Dividend
The final ordinary dividend No. 101 of 150 cents per share in respect of the
year ended 30 June 1998 was declared on 18 August 1998 and paid on 30 September
1998.
2. Headline Earnings
Headline earnings are calculated after the deduction of exceptional gains and
its respective portion of tax and minorities' interest.
Exceptional gains are summarised as follows:
Surplus on disposal of investments 604
Surplus on disposal of mining title 158
Less: Additional restructuring costs 24
Loss on disposal of assets 23
715
3. Restructuring
As previously reported, during the course of last year the Group embarked on a
restructuring process which involved the distribution to its shareholders
and/or the sale of some or all the assets of the Group. One of the steps in
this process was the distribution to GFSA shareholders of the Group's interests
in Gold Fields Limited ("GFL") and Standard Bank Investment Corporation Limited
("Stanbic").
At a general meeting held on 16 September 1998 shareholders approved all the
necessary resolutions and, pursuant to all other conditions precedent having
been fulfilled, the distribution was effected on 19 October 1998. GFSA
shareholders received 155,265 GFL shares and 96,208 Stanbic shares for every 100
GFSA shares held.
4. Base Metal Interests Pursuant to the initiation of an international select
tender process in June last year, indicative proposals were received from
interested parties regarding the acquisition of all or some of the Group's base
metal interests. During the period under review agreement was reached with
various parties regarding the acquisition of these interests, subject to the
completion of due diligence studies. By the end of December 1998 all
transactions had been concluded, with the exception of that relating to Zinc
Corporation of South Africa Limited. Brief details are furnished below.
5.Dwarsrivier Farms Limited
The mineral rights to chrome and platinum group metals, held by this company
in the Lydenburg, Mpumalanga area, were sold to Associated Manganese Mines of
South Africa for R163 million.
6. Black Mountain and Gamsberg
Zinc The Group's respective interests in Black Mountain Mineral Development
Company (Proprietary) Limited ("BMMD") and Gamsberg Zinc Corporation Limited
("Gamsberg") were acquired by Anglo American Corporation of South Africa
Limited for cash considerations of R155 million and R165 million respectively.
These interests were:
* a 55,4% interest in BMMD held by GFSA and its
wholly-owned subsidiary Gold Fields Mining and Development Limited ("GFMD")
(54,5%) and Vogelstruisbult Metal Holdings Limited ("Vogels") (0,9%);
and
* a 55% interest in Gamsberg held by GFMD (27,5%) and O'okiep Copper Company
Limited (27,5%).
7. O'okiep
The Group's interest of 81,47% in O'okiep Copper Company Limited held by GFSA
(48,61%), Vogels (30%) and New Wits Limited (2,86%) was sold to Metorex
(Proprietary) Limited for a cash consideration of R28,175 million.
8. Zincor
An offer was received from Iscor Limited ("Iscor") to acquire the Group's 65%
interest in Zinc Corporation of South Africa Limited for a consideration of
R245 million. The due diligence study by Iscor was to have been completed by 13
November 1998 but, as announced in the press, Iscor was granted an extension to
this date. The Group's interest is held by GFSA (17,7%), New Wits (9,3%) and
Vogels (38%). The sale remains subject to the approval of the directors and/or
shareholders of GFSA, New Wits and Vogels, as may be required and to the extent
that the sale affects each of these companies.
9. Commercial Union
The Group's 22% interest in Commercial Union of South Africa Limited was sold to
Metropolitan Life Limited for a cash consideration of R232 million.
10. Business Partners
The Group's interest in Business Partners (formerly Small Business Development
Corporation) was sold for R44 million.
11. Share capital
In terms of an ordinary resolution passed at the aforementioned general meeting
of shareholders of this company on 16 September 1998, shareholders approved the
early termination of participants' interests in the Gold Fields Incentive Scheme
and agreed, in consideration for the early termination, that there be made over
to such participants a maximum of 623 732 ordinary shares in the company, of
which 473 250 shares received by a subsidiary of this company in terms of the
unbundling of New Wits Limited, were made over by that subsidiary directly to
such participants and the balance of 150 482 shares were allotted and issued by
this company to such participants. Accordingly the company's issued share
capital has increased to R5 703 769,25 divided into 114 075 385 ordinary shares
of 5 cents each.
12. Year 2000
Full testing of the computer systems, on which the company is dependent, is in
progress to ensure that they are year 2000 compliant. The nature of operations
is such that the directors do not believe that the company would be vulnerable
to business interruption in the event that any of the computer systems used by
it fail at the change of the millennium.
13. Staff
A small specialised team is now in place to realise the remaining assets and to
bring to completion the restructuring process.
14. Outlook
Every effort is being made to dispose of the company's remaining assets. Failure
to conclude an agreement to dispose of its holding in Northam leaves unbundling
as a viable alternative. The liquidation of Tsumeb Corporation Limited has not
yet been finalised and the sale of Zinc Corporation will affect the future
strategy of both New Wits and Vogelstruisbult Metal Holdings (which in turn
affects this company). With the exception of the 75 Fox Street building, the
sale process for most of the balance of the assets, largely mineral rights, is
well advanced. Their value is small in comparison to the net asset value of the
company.
Declaration of interim dividend
Ordinary dividend No. 102 of 300 cents per ordinary share has been declared in
South African currency, payable to members registered in the books of the
company at the close of business on 5 February 1999.
Dividends will be electronically transferred to members' bank or building
society accounts on 3 March 1999 or, where this method of payment has not been
mandated, dividend warrants will be posted on 2 March 1999.
The standard conditions relating to the payment of dividends are obtainable at
the share transfer office and the London office of the company.
Kenilworth House On behalf of the board
Rutherford Estate J. P. Rupert
1 Scott Street (Chairman)
Waverley A. J. Wright
2090 (Deputy Chairman)
18 January 1999
http://www.gfsa.co.za
END
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