* CEO says acquisitions planned over the medium term
* Co targets long-term output of 2.7 mln ounces a year
* CEO says no change to 2021 output, cost guidance (Adds conference call, analyst comment)
JOHANNESBURG, Aug 19 (Reuters) - South Africa-based Gold Fields Ltd reported a doubling in half-year profit on Thursday as it benefited from rising prices and output while its new CEO said the company would look for acquisitions over the medium term.
The company’s shares were up almost 5% by 1024 GMT, comfortably outperforming a fall of around 2.3% in the broader index.
Gold Fields, one of the world’s top 10 gold producers with operations across Australia, Latin America and Africa, embarked on an organic growth strategy four years ago to extend its mine life, increase reserves and boost output.
CEO Chris Griffith, who took over the role in April, said he is comfortable with the current strategy but since the company’s production would peak at around 2.7-2.8 million ounces by 2024, he would look at ways to maintain output levels.
“It may require us to look at either acquiring, or developing new projects, perhaps acquiring some in-production assets,” Griffith told Reuters in an interview.
“I think it’s more of a medium-term strategy. But we’ll start doing that homework now.”
He said the company is “actively looking” at assets in areas near its existing mines but is also open to new regions.
The company expects to end the year with production of 2.3-2.35 million ounces of gold with no change to the production and cost guidance, the CEO said.
Gold miners globally had a great run last year as pandemic uncertainties drove bullion prices to record highs.
Miners compounded their earnings, started cutting debt and increased capital expenditure to mine lower grades that became viable at high prices. That increased costs for companies even as production, revenue and profits soared.
Gold Fields’ all-in sustaining costs, a metric to measure the all round cost of gold miners, rose 11% to $1,093 per ounce for the six months through June.
Christiaan Bothma, an investment analyst at Sanlam Private Wealth said Gold Fields’ overall costs would trend lower over the next few years as a major Chile project comes online.
The company reported headline earnings per share of $0.45, up from 20 cents a share a year earlier, and declared a net local dividend amount of 1.68 rand ($0.1118) per share.
$1 = 15.0274 rand Reporting by Promit Mukherjee; Editing by Jacqueline Wong, Ramakrishnan M., Kirsten Donovan and Susan Fenton
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