Mine Tragedies Overshadow Group Results

JOHANNESBURG, May 9 /PRNewswire/ -- Gold Fields Limited NYSE: GFI today announced headline earnings for the March 2008 quarter of R1,246 million, compared with headline earnings of R456 million and R228 million for the December 2007 and the March 2007 quarters respectively. In US dollar terms headline earnings for the March 2008 quarter were US$176 million, compared with earnings of US$67 million and US$32 million for the December 2007 and the March 2007 quarters respectively.

March 2008 quarter salient features:

- Attributable gold production decreased 14 per cent to 827,000 ounces largely due to power disruptions in South Africa;

- Total cash costs increased 21 per cent from R101,532 per kilogram (US$467 per ounce) to R122,920 per kilogram (US$513 per ounce) mainly due to the loss of production at the South African operations;

- Agreement was reached with Mvela whereby the number of GFL shares to be exchanged for 15 per cent of GFIMSA will be fixed at 50 million shares;

- Cerro Corona on track for production of concentrate during the September 2008 quarter;

- Nick Holland takes over as the new Chief Executive Officer from Ian Cockerill and Terence Goodlace appointed Chief Operating Officer, effective from 1 May 2008.

An interim dividend declared of 65 SA cents per share payable on 2 June 2008.

Statement by Nick Holland, Chief Executive Officer of Gold Fields:

"It is with deep regret that subsequent to quarter end three separate accidents resulted in the death of 14 of our colleagues. On 28 April a seismic event at Driefontein's 10 shaft resulted in the death of four colleagues and at South Deep one colleague lost his life in a fall of ground accident on 29 April. On 1 May at South Deep nine colleagues died when a winder rope apparently broke and a conveyance fell 59 metres to the bottom of the 215 metre long ancillary ventilation raise hole between 100 and 110A levels. In all instances full investigations are currently underway. Gold Fields also intends to commission an external, full safety review at all its operations.

From an operational perspective the March quarter was characterised by two important developments.

The first was the power disruptions in South Africa, which had a significantly negative impact on Group production and costs.

The second was the 29 per cent increase in the average rand/gold price received from R170,488 to R220,612 per kilogram as a result of a 17 per cent increase in the US dollar price of gold, combined with a 10 per cent weakening of the South African rand quarter on quarter.

Despite the negative impact of the power disruptions in South Africa, the Group margin increased from 38 per cent in the December 2007 quarter to 42 per cent in the March 2008 quarter. This demonstrates the benefits of a higher gold price combined with the shielding effect of the weakening currency on Gold Fields' earnings which, combined with cost leadership in a very challenging inflationary environment globally, should enable Gold Fields to capture some of the higher price received for the benefit of shareholders going forward.

The Group should benefit over the next three quarters as production in South Africa normalises at stable power supply levels and, in particular, as production increases from the international operations with the commissioning of the Cerro Corona mine in the September 2008 quarter and the completion of the Tarkwa CIL plant expansion during the December 2008 quarter. This, combined with the reduction in capital expenditure as these projects are completed, is expected to bolster free cash flow and earnings."

    
           The full results are available on the Gold Fields website:
                         http://www.goldfields.co.za

About Gold Fields

Gold Fields Limited is one of the world's largest unhedged producers of gold with attributable production of more than four million ounces per annum from eight operating mines in South Africa, Ghana and Australia.

A ninth mine, the Cerro Corona Gold/Copper mine in Peru, is expected to commence production by mid 2008 at an initial rate of approximately 400,000 gold equivalent ounces per annum.

The company has total attributable ore reserves of 92 million ounces and mineral resources of 252 million ounces.

Gold Fields employs some 53,000 permanent employees across its operations and is listed on the JSE Limited South Africa (primary listing), the New York Stock Exchange (NYSE) and the Dubai International Financial Exchange (DIFX). All of Gold Fields' operations are ISO14001 certified. For more information please visit the Gold Fields website at http://www.goldfields.co.za.