By Felix Njini and Nelson Banya
JOHANNESBURG (Reuters) -Gold Fields may consider a share buyback programme as a way to boost shareholder returns if the gold price remains elevated, CEO Mike Fraser said on Thursday, as the mining company reported a 42% jump in annual profit.
Gold Fields shares hit a record high after the results, rising 8% in mid-morning trade on the Johannesburg Stock Exchange.
The South African gold miner on Thursday reported a $1.2 billion profit for last year, supported by rising gold prices, even though its output of the precious metal fell 10%.
Gold Fields raised its dividend by 34% to 10 rand ($0.54) per share – a company record – after its profit rose to about $1.2 billion last year from $837 million the previous year.
“With that strong cash generation, there would be opportunities for further returns and we’re considering what is the best way to do that,” Fraser told Reuters in an interview.
“Buybacks certainly would be part of the consideration,” he added.
Larger producers, companies with high quality portfolios and miners not pursuing significant development programmes will have more room to deliver high returns to shareholders, Fraser said.
Gold prices rose by more than 27% in 2024, their biggest yearly jump since 2010, driven by safe-haven demand, interest rate cuts and buying from central banks. The rally has continued into 2025 and some analysts see the gold price breaching the $3,000 per ounce mark this year.
Gold Fields joins peers including AngloGold and Barrick in boosting returns to investors as bullion prices hit record highs.
The company said its output dropped 10% to about 2 million ounces last year but expects output to rise to between 2.25 million ounces to 2.45 million ounces this year, as it ramps up production at a new Salares Norte mine in Chile.
Gold Fields plans to start building a new mine at its Windfall project in Quebec, Canada this year, with production targeted to begin in 2028, it said.
($1 = 18.5066 rand)
(Reporting by Felix Njini in Johannesburg and Nelson Banya in Harare; Editing by Kim Coghill, Rachna Uppal and Susan Fenton)
