South Africa’s Gold Fields said on Thursday it expects full-year profit to fall as much as 12% due to impairments and increased amortisation cost at its mines.
The bullion miner flagged headline earnings per share — the main gauge of profit in South Africa — of $0.23 to $0.26 per share for the year ended December 31, 2017, or between unchanged and up to 12% lower compared to a year earlier.
The company, which also operates in Ghana and Peru, said earnings were affected by an increase in amortisation at its Tarkwa, Cerro Corona and St Ives operations, while its last South African asset, South Deep, was hit by impairments.
Shares in Gold Fields were down 5.44% to R47.16 by 1323 GMT after the profit warning.
“It was a big miss, they [the market] expected better results from Gold Fields,” said BP Bernstein trader Vasili Girasis.
The company is due to report full-year results on February 14.
On average, analysts were expecting 2017 earnings per share of $0.23, according to Thomson Reuters Eikon data.
The life of its Cerro Corona mine in Peru would be extended to 2030 from 2023 through additional tailings capacity, with fourth quarter production expected to be 546 000 ounces, the firm said.