4
Amid record net cash-flows and earnings – both more than double our
performance in 2019 - we reduced net debt by almost US$600m, placing our
balance sheet in a very healthy position and could well be close to zero
net debt within 18 months, while also bringing Salares Norte into
construction and eventual production. Our shareholders also received a
total dividend of R4.80/share for 2020, three times that of 2019.
In February last year, the Board approved the go ahead for the US$860m
Salares Norte project in Chile. Construction proceeded as planned during
the year, despite the pandemic, and is set for completion in Q1 2023.
Salares Norte is the latest building block in the Company’s growth-
through-development programme of the past four years, during which we also
effectively built two new mines, Gruyere in Australia and Damang in Ghana.
Both mines are now contributing meaningfully to the Group’s cash-flow, as
is South Deep, which continues to show strong financial and operational
improvements.
Gold Fields places a high value on maximising in-country and host
community economic impact. The Group’s value distribution to national
economies amounted to US$2.85bn in 2020. Of this, US$677m – 28% – remained
with our host communities. We achieved this by preferentially employing
from our host communities, prioritising procurement from community
enterprises and channelling our socio-economic development (SED) spend to
these communities. Over the past five years, we have created over US$3.5bn
in host community value, which is a significant investment in the economic
wellbeing of our communities and the estimated 435,000 people who reside
there.
At the same time, we need to ensure that our mining activities do not
adversely impact the environment. Pleasingly, we recorded zero serious
environmental incidents for the second year in a row – a good yardstick of
our success in this area. Similarly, our high levels of water recycling
and reuse limited our uptake of freshwater from our catchment areas, while
our continued investment in renewable energy is one of the ways we limit
our carbon emissions. During 2020, we successfully commissioned renewable
microgrids at our Agnew and Granny Smith mines in Australia. Furthermore,
a renewable microgrid is under construction at Gruyere mine. And now that
we have received the relevant approvals from government, South Deep will
be the next operation in our portfolio to build a solar plant. The Board
approved the R660m construction of the plant this week and it should be
operational in a year’s time.
The Board also seeks to further improve the diversity and inclusivity of
the Company’s workforce. While we made some progress – with around 20% of
our workforce now female – we still have a way to go to truly reflect the
demographics of the countries in which we operate. With the rapid
modernisation of our mines, we also need to ensure that our workforce is
appropriately skilled to meet the challenges of digitisation and
automation. We are adapting training, skills development and recruitment
policies to ensure our people can succeed in these new ways of working.
In recent years, managing environmental, social and governance (ESG)
issues has become an increasingly critical consideration for our
stakeholders – particularly investors. Together with management, the Board
is developing a range of strategic ESG priorities ranging from safety to
climate change, diversity and communities. Before the end of the year, we
plan to publish detailed targets and timelines for these priorities.