JOHANNESBURG (miningweekly.com) – JSE- and NYSE-listed Gold Fields increased its production by 21% to 598 000 oz during the three months ended December, as it successfully integrated the Yilgarn South assets, in Western Australia, into its portfolio, the miner said on Thursday.

Yilgarn South contributed 114 000 oz during the quarter, at an aggregate all-in cost of less than $1 000/oz. The assets, which in the short term had been restructured to lower their costs in line with group objectives, were also expected to contribute about 400 000 oz during 2014, at $1 000/oz.

“In mid-2012, Gold Fields embarked on a fundamental shift in strategy away from an emphasis on ounces of production to a primary focus on driving margins and cash flow. To this end, and to sustain our business in the long term, we embarked on a process to engineer a sustainable and structural shift in the group’s cost and production base. This process continued through the December 2013 quarter and will carry on throughout 2014,” Gold Fields CEO Nick Holland said.

During the period under review Gold Fields achieved success in its efforts to engineer a sustainable and structural shift in its cost base, with all-in sustaining costs declining by 3% quarter-on-quarter and 24% year-on-year to $1 054/oz, while the total all-in cost, at $1 095/oz, was 7% lower quarter-on-quarter.

Meanwhile, total cash costs increased marginally to $776/oz.

Gold Fields also said its 2013 cost and production guidance had been exceeded, with the group’s attributable production for the full year of 2.02-million ounces being 6% higher than the upper end of the original guidance of between 1.83-million ounces and 1.9-million ounces provided on February 27, 2013, and 1% above the upper end of the revised guidance of between 1.92-million ounces and 2-million ounces provided on November 20, 2013, after the acquisition of the Yilgarn South assets.

The group’s total cash cost for the full year 2013, at $803/oz, was also 7% lower than the guidance of $860/oz, provided on February 27, 2013, and reaffirmed on November 20, 2013.

Gold Fields on Thursday also reported normalised earnings from continuing operations for the quarter under review of $14-million, compared with $12-million in the September 2013 quarter and $127-million in the December 2012 quarter.

Meanwhile, the group also reported a R7-billion impairment as a result of a lower gold price and higher discount rates, which led to Gold Fields' share price dropping by 5.95% to R40.60 a share as of 15:45 on Thursday.

The group would pay a final dividend of 22c a share on March 10, giving a total dividend for the year ended December 2013 of 22c a share.