You should read the following discussion and analysis together with Gold Fields’ consolidated financial statements, including the notes, appearing elsewhere in this annual report. Certain information contained in the discussion and analysis set forth below and elsewhere in this annual report includes forward-looking statements that involve risks and uncertainties. See “Forward-looking Statements” and “Risk Factors” for a discussion of important factors that could cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in this annual report. Management’s Discussion And Analysis Of The Financial Statements The following management’s discussion and analysis of the financial statements should be read together with the Gold Fields’ consolidated financial statements, including the notes accompanying these financial statements. Overview Gold Fields is a significant producer of gold and a major holder of gold reserves and resources in South Africa, Ghana, Australia and Peru. In Peru, Gold Fields also produces copper. Gold Fields is primarily involved in underground and surface gold and surface copper mining and related activities, including exploration, extraction, processing and smelting. In fiscal 2016, the South African, Ghanaian, Peruvian and Australian operations produced 13%, 32%, 12% and 43% of its total gold production, respectively. Gold Fields’ South African operation is South Deep. Gold Fields also owns the St. Ives, Agnew/Lawlers, Granny Smith and Darlot gold mining operations in Australia and has a 90.0% interest in each of Tarkwa and Damang in Ghana. Gold Fields also owns a 99.5% interest in the Cerro Corona mine in Peru. During February 2017, Gold Fields announced its intention to dispose of the Darlot operation. On December 13, 2016, Gold Fields purchased 50% of the Gruyere Gold Project and entered into a 50:50 unincorporated joint venture with Gold Road for the development and operation of the Gruyere Gold Project in Western Australia, which comprises the Gruyere gold deposit as well as additional resources including Central Bore and Attila/Alaric (Gruyere). Gold Fields acquired 50% interest in the Gruyere Gold Project for a total purchase consideration of A$350 million (U.S.$259 million) payable in cash and a 1.5% royalty on Gold Fields’ share of production after total mine production exceeds two million ounces. The cash consideration was split with A$250 million (U.S.$185 million) payable on the effective date and A$100 million (U.S.$74 million) payable according to an agreed construction cash call schedule. Transaction costs of A$19 million (U.S.$13 million) were incurred. As of December 31, 2016, Gold Fields reported attributable proven and probable gold and copper reserves of 48.1 million ounces of gold and 454 million pounds of copper, as compared to the 46.1 million ounces of gold and 532 million pounds of copper, reported as of December 31, 2015. Total gold production was 2.219 million ounces of gold equivalents in fiscal 2016, 2.146 million ounces of which were attributable to Gold Fields with the remainder attributable to non-controlling shareholders in Ghana and Peru. Total gold production was 2.236 million ounces of gold equivalents in fiscal 2015, 2.159 million ounces of which were attributable to Gold Fields with the remainder attributable to non-controlling shareholders in Ghana and Peru. At South Deep in South Africa, production increased by 47% from 6,160 kilograms (198,000 ounces) in fiscal 2015 to 9,032 kilograms (290,400 ounces) in fiscal 2016 due to increased volumes and grades. 155 Table of Contents At the Ghanaian operations, gold production decreased by 5% from 753,900 ounces in fiscal 2015 to 715,800 ounces in fiscal 2016. At Tarkwa, gold production decreased by 3% from 586,100 ounces to 568,100 ounces mainly due to lower yield. At Damang, gold production decreased by 12% from 167,800 ounces to 147,700 ounces mainly due to lower yield. Gold equivalent production at Cerro Corona decreased by 9% from 295,600 ounces in fiscal 2015 to 270,200 ounces in fiscal 2016 mainly due to the lower copper to gold price ratio as well as lower gold head grades treated and lower gold recovery. At the Australian operations, gold production decreased by 5% from 988,000 ounces in fiscal 2015 to 942,400 ounces in fiscal 2016. At St. Ives, gold production decreased by 2% from 371,900 ounces to 362,900 ounces due to lower grade of ore milled following the closure of the Cave Rocks and Athena underground mines and transition to a predominantly open pit operation. At Agnew/Lawlers, gold production decreased by 3% from 236,600 ounces to 229,300 ounces mainly due to a reduction in ore processed. At Darlot, gold production decreased by 15% from 78,400 ounces to 66,400 ounces due to lower grades mined. At Granny Smith, gold production decreased by 6% from 301,100 ounces to 283,800 ounces due to lower grades mined and an increase in stockpiled ore as a consequence of the timing of December milling campaign. Revenues Substantially all of Gold Fields’ revenues are derived from the sale of gold and copper. As a result, Gold Fields’ revenues are directly related to the prices of gold and copper. Historically, the prices of gold and copper have fluctuated widely. The gold and copper prices are affected by numerous factors over which Gold Fields does not have control. The volatility of gold and copper prices is illustrated in the following tables, which show the annual high, low and average of the London afternoon fixing price of gold and the LME cash settlement price for copper in U.S. dollars for the past 12 calendar years (2005 – 2016): Price per ounce(1) Gold High Low Average (U.S.$/oz) 2005 537 411 445 2006 725 525 604 2007 834 607 687 2008 1,011 713 872 2009 1,213 810 972 2010 1,421 1,058 1,224 2011 1,895 1,319 1,571 2012 1,792 1,540 1,669 2013 1,694 1,192 1,409 2014 1,385 1,142 1,266 2015 1,296 1,060 1,167 2016 1,355 1,077 1,250 Source: I-Net Note: (1) Rounded to the nearest U.S. dollar. 156 Table of Contents On April 3, 2017, the London afternoon fixing price of gold was U.S.$1,247. Price per tonne(1) Copper High Low Average (U.S.$/t) 2005 4,650 3,072 3,687 2006 8,788 4,537 6,728 2007 8,301 5,226 7,128 2008 8,985 2,770 6,952 2009 7,346 3,051 5,164 2010 9,740 6,091 7,539 2011 9,986 7,062 8,836 2012 8,658 7,252 7,951 2013 8,243 6,638 7,324 2014 7,440 6,306 6,861 2015 6,401 4,347 5,376 2016 5,936 4,311 4,863 Source: I-Net Note: (1) Rounded to the nearest U.S. dollar. On April 3, 2017, the LME cash settlement price for copper was U.S.$5,783/tonne. As a general rule, Gold Fields sells the gold it produces at market prices to obtain the maximum benefit from prevailing gold prices and does not enter into hedging arrangements such as forward sales or derivatives which establish a price in advance for the sale of its future gold production. Hedges can be undertaken in one or more of the following circumstances: to protect cash flows at times of significant capital expenditures, for specific debt servicing requirements and to safeguard the viability of higher cost operations. During 2016 and at December 31, 2016, Gold Fields had no commodity hedging arrangements in place. Significant changes in the prices of gold and copper over a sustained period of time may lead Gold Fields to increase or decrease its production in the near-term, which could have a material impact on Gold Fields’ revenues. Sales of copper concentrate are “provisionally priced”—that is, the selling price is subject to final adjustment at the end of a period normally ranging from 30 to 90 days after delivery to the customer, based on market prices at the relevant quotation points stipulated in the contract. Revenue on provisionally priced copper concentrate sales is recorded on the date of shipment, net of refining and treatment charges, using the forward LME price to the estimated final pricing date, adjusted for the specific terms of the agreements. Variations between the price used to recognize revenue and the actual final price received can be caused by changes in prevailing copper prices and result in an embedded derivative. The host contract is the receivable from the sale of copper concentrate at the forward LME price at the time of sale. The embedded derivative, which does not qualify for hedge accounting, is marked-to-market each period until final settlement occurs, with changes in fair value classified as provisional price adjustments and included as a component of revenue while the contract itself is recorded in accounts receivable. 157 Table of Contents Gold Fields’ Realized Gold and Copper Prices The following table sets out the average, the high and the low London afternoon fixing price per ounce of gold and Gold Fields’ average U.S. dollar realized gold price during the past three years. Gold Fields’ average realized gold price per equivalent ounce is calculated using the actual price per ounce of gold received on gold sold and the actual amount of revenue received on sales of copper, expressed in terms of the price per gold equivalent ounce. Realized Gold Price(1) 2016 2015 2014 (U.S.$) Average 1,250 1,167 1,266 High 1,355 1,296 1,385 Low 1,077 1,060 1,142 Gold Fields’ average realized gold price(2) 1,241 1,140 1,249 Notes: (1) Prices stated per ounce. (2) Gold Fields’ average realized gold price may differ from the average gold price due to the timing of its sales of gold within each year. The following table sets out the average, the high and the low LME cash settlement price per tonne for copper and Gold Fields’ average U.S. dollar realized copper price for fiscal 2016, fiscal 2015 and fiscal 2014. Realized Copper Price(1) 2016 2015 2014 (U.S.$) Average 4,863 5,376 6,861 High 5,936 6,401 7,440 Low 4,311 4,347 6,306 Gold Fields’ average realized copper price(2) 4,913 4,787 6,827 Notes: (1) Prices stated per tonne. (2) Gold Fields’ average realized copper price may differ from the average copper price due to the timing of its sales of copper within each year and is net of treatment and refining charges. Production Gold Fields’ revenues are primarily driven by its production levels and the price it realizes on the sale of gold. Production levels are affected by a number of factors, some of which are described below. Total managed production decreased from 2.24 million ounces in fiscal 2015 to 2.22 million ounces in fiscal 2016. Labor Impact In recent years, Gold Fields has experienced union activity in some of the countries in which it operates, including the entry of rival unions, which has resulted in more frequent industrial disputes, including violent protests, intra-union violence and clashes with police authorities, and has impacted labor relations. South Deep has a relatively well educated labor force with a component of skilled and semi-skilled employees who receive remuneration packages that are competitive and highly incentivized. There is also no evidence to date that AMCU, which has been responsible for extensive strike action at South Africa’s gold and platinum mines, has established a material presence at the mine. The NUM is the dominant union, providing relatively stable relations. There were no work stoppages as a result of strikes during 2016, 2015 and 2014 at all the Gold Fields operations. 158 Table of Contents Health and Safety Impact Gold Fields’ operations are also subject to various health and safety laws and regulations that impose various duties on Gold Fields’ mines while granting the authorities broad powers to, among other things, close or suspend operations at unsafe mines and order corrective action relating to health and safety matters. Additionally, it is Gold Fields’ policy to halt production at its operations when serious accidents occur in order to rectify dangerous situations and, if necessary, retrain workers. During 2016, Gold Fields operations suffered 16 work safety related stoppages, two related to the fatality in September and 14 related to unsafe conditions. During 2015, Gold Fields operations suffered three work safety related stoppages, two related to the fatalities in March and May and the third one related to a serious accident in April. In South Africa, Gold Fields has actively engaged with the DMR on the protocols applied to safety-related mine closures. Gold Fields expects that each of these factors will continue to impact production levels in the future. Costs Over the last three years, Gold Fields’ production costs consisted primarily of labor and contractor costs, power, water and consumable stores, which include explosives, timber, diesel fuel, other petroleum products and other consumables. Gold Fields expects that its total costs, particularly the input costs noted above, are likely to continue to increase in the near future driven by general economic trends, market dynamics and other regulatory changes. In order to counter the effect of increasing costs in the mining industry, the Group rationalized and prioritized capital expenditure without undermining the sustainability of its operations and continued prioritization of cash generation over production volumes. The Group also undertook further reductions in labor costs. One of Gold Fields’ strategic priorities relates to the proactive management of costs with a view of achieving a 15% FCF Margin at a U.S.$1,300 per ounce gold price. The Gold Fields’ South African operation is labor intensive due to the use of deep level underground mining methods. As a result, over the last three fiscal years labor has represented on average 34% of AIC at the South African operation. In fiscal 2016, labor represented 36% of AIC at the South African operation. At the latest wage talks with organized labor which commenced on March 19, 2015, Gold Fields offered an all-inclusive package which included a scarce skills allowance and a housing allowance. On April 10, 2015, the Group signed a three-year wage and other conditions of employment agreement with the NUM and UASA, the registered trade unions at South Deep. The agreement resulted in average annual wage increases of 10% over the three-year period of the deal. The first increase took effect on April 1, 2015. At the South African operation, power and water made up on average 9% of AIC over the last three years. In fiscal 2016, power and water costs made up 8% of AIC at the South African operation. Eskom applied to the NERSA for a 16% average tariff increase on each of April 1, 2013, 2014, 2015, 2016 and 2017, and NERSA granted Eskom an average increase of 8% for each of the years, except for the actual legislated increase applicable to the mining industry on April 1, 2015 which was 12.69%, being 8% plus 4.69% due to the clawing back by Eskom of prudent costs through the “regulatory clearing account” in respect of the three-year period from April 2010 to March 2013 and an increase of 9.4% effective April 1, 2016. Effective April 1, 2017, NERSA approved a 2.2% electricity increase. It is not clear what increases will be granted in the future. Both Tarkwa and Damang concluded tariff negotiations for fiscal 2014 and fiscal 2015 with their respective power suppliers (the state electricity supplier, the VRA, supplies power to Tarkwa and the ECG provides power to Damang). The ECG’s tariff for the period January 1, 2014 to December 31, 2014 was U.S.$0.22/kWh, from January 1, 2015 to December 31, 2015 was U.S.$0.23/kWh and January 1, 2016 to December 31, 2016 was U.S.$0.23/kWh. Following negotiations with management, ECG agreed to decrease its tariffs to U.S.$0.20/kWh 159 Table of Contents from August 1, 2015 to January 31, 2016. Tarkwa has agreed tariffs with VRA with a base tariff of U.S.$0.17/kWh with effect from January 1, 2015 using a tariff model which inputs actual variables (including the generation mix and input prices) of the previous quarter to determine the tariff for the current quarter. The average VRA tariff for fiscal 2016 was U.S.$0.16/kWh. In order to reduce their reliance on power supplied by VRA and ECG, Tarkwa and Damang entered into a 15 and eight-year power purchase agreement with independent power producer Genser. Under the power purchase agreement, Genser agreed to commission a gas’ power generation facility at Tarkwa and Damang. This power supply is expected to eventually replace all or a significant proportion of Tarkwa and Damang’s current supply from the VRA and ECG. Genser has installed three 11MW turbines at Tarkwa and five 5.5MW turbines at Damang. These plants were commissioned in December 2016. An additional 11MW is planned to be installed at Tarkwa to meet full demand, with commissioning set for January 2018. Contractor costs represented on average 6% of AIC at Tarkwa over the last fiscal years, and 6% of AIC during 2016. Over the last three years, contractor costs represented on average 17% of AIC at Damang with 21% in fiscal 2016. Following the restructuring concluded in the first half of 2016 in Damang, the direct labor cost has decreased as all mining and development will be performed by outside contractors. Direct labor costs represent on average a further 14% of AIC at Tarkwa over the last three years and 15% in fiscal 2016. Over the last three years, direct labor costs represented on average 15% at Damang and 12% in fiscal 2016. Gold Fields’ operations in Ghana consume large quantities of diesel fuel for the running of their mining fleet. The cost of diesel fuel is directly related to the oil price and any movement in the oil price will have an impact on the cost of diesel fuel and therefore the cost of running the mining fleet. Over the last three years, fuel costs have represented 11% of AIC at the Ghana operations. In fiscal 2016, fuel costs represented 10% of AIC at the Ghana operations. Fuel use is proportionately higher at the Ghana operations than at other operations because open pit mining in general requires more fuel usage than underground mining and because of the configuration of the Ghana operations, including the scale of certain of the pits and the distances between the pits and the plants. At Cerro Corona, contractor cost represented on average 25% of AIC over the last three years and 25% of AIC during 2016. Direct labor costs represent on average a further 17% of AIC over the last three years and 20% in fiscal 2016. Power and water made up on average a further 5% of AIC over the last three years and 6% in fiscal 2016. At the Australian operations, mining operations were historically conducted by outside contractors. However, at Agnew/Lawlers, owner mining at the underground operations commenced in May 2010, while development is still conducted by outside contractors. At St. Ives, owner mining commenced in July 2011 at the underground operations and in July 2012 at the surface operations, but development is still conducted by contractors. Over the last three years, total contractor costs represented on average 22% at St. Ives and 35% at Agnew/Lawlers of AIC and direct labor costs represented on average a further 16% at St. Ives and 16% at Agnew/Lawlers of AIC. In fiscal 2016, contractors and direct labor cost represented 24% and 16% at St. Ives and 41% and 18% at Agnew/Lawlers, respectively. Power and water made up, on average, a further 9% and 7% of AIC over the last three years and 9% and 6% of AIC in fiscal 2016 at St. Ives and Agnew/Lawlers, respectively. At the Granny Smith and Darlot operations, mining operations and development are conducted through owner mining. Over the last three years, contractors and direct labor cost represented, on average, 16% and 25% at Granny Smith and 16% and 35% at Darlot, respectively. In fiscal 2016, contractors and direct labor cost represented 16% and 26% at Granny Smith and 16% and 35% at Darlot, respectively. Power and water made up, on average, a further 9% and 8% of AIC over the last three years and 8% and 9% of AIC in fiscal 2016 at Granny Smith and Darlot, respectively. The remainder of Gold Fields’ total costs consists primarily of amortization and depreciation, exploration costs and selling, administration and general and corporate charges. 160 Table of Contents All-in Sustaining and All-in Cost The WGC has worked closely with its member companies to develop definitions for AISC and AIC. The WGC is not a regulatory industry organization and does not have the authority to develop accounting standards or disclosure requirements. Gold Fields ceased being a member of the WGC in fiscal 2014. AISC and AIC are non-IFRS measures. These non-IFRS measures are intended to provide further transparency into the costs associated with producing and selling an ounce of gold. The standard was released by the WGC on June 27, 2013. It is expected that these metrics will be helpful to investors, governments, local communities and other stakeholders in understanding the economics of gold mining. AISC incorporates costs related to sustaining current production. AIC includes additional costs which relate to the growth of the Group. AISC, as defined by the WGC, are operating costs plus all costs not already included therein relating to sustaining current production, including sustaining capital expenditure. The value of by-product revenues such as silver and copper is deducted from operating costs as it effectively reduces the cost of gold production. AIC starts with AISC and adds additional costs which relate to the growth of the Group, including non-sustaining capital expenditure and exploration, evaluation and feasibility costs not associated with current operations. AISC and AIC are reported on a per ounce of gold basis, net of by-product revenues (as per the WGC definition) as well as on a per ounce of gold equivalent basis, gross of by-product revenues. An investor should not consider AISC or AIC in isolation or as alternatives to operating costs, cash flows from operating activities or any other measure of financial performance presented in accordance with IFRS. AISC and AIC as presented in this report may not be comparable to other similarly titled measures of performance of other companies. 161 Table of Contents The following tables set out a reconciliation of Gold Fields’ operating costs, as calculated in accordance with IFRS (refer note 2 to the consolidated financial statements), to its AISC and AIC net of by-product revenues per ounce of gold sold for fiscal 2016, 2015 and 2014. The following tables also set out AISC and AIC gross of by-product revenue on a gold equivalent ounce basis for fiscal 2016, 2015 and 2014. AISC and AIC, net of by-product revenue per ounce of gold For the year ended December 31, 2016 South Deep Tarkwa Damang St. Ives Agnew/ Lawlers Darlot Granny Smith Cerro Corona Corporate and other Group(1) (in U.S.$ million except as otherwise stated) Operating costs 272.3 344.7 136.4 192.8 145.7 57.3 141.1 143.7 (1.1 ) 1,433.0 Gold inventory change (0.7 ) (17.5 ) (0.4 ) (11.0 ) (5.1 ) 0.4 (7.4 ) (3.8 ) — (45.5 ) Royalties 1.8 35.4 9.2 11.5 7.1 2.0 8.8 4.6 — 80.4 Realized gains and losses on commodity cost hedges — — — 0.6 0.2 0.1 0.7 — — 1.6 Community/social responsibility costs 1.2 5.1 0.3 — — — — 8.7 — 15.3 Non-cash remuneration (share-based payments 2.3 2.5 0.3 1.5 0.8 0.4 0.9 2.0 3.6 14.4 Cash remuneration (long-term employee benefits 2.4 3.0 0.8 0.9 0.9 0.6 1.0 1.8 (0.5 ) 11.0 Other — — — — — — — 0.9 11.9 12.8 By-product revenue(2) (0.5 ) (1.5 ) (0.1 ) (0.8 ) (0.2 ) (0.3 ) (0.1 ) (130.6 ) — (134.1 ) Rehabilitation amortization and interest 0.4 4.8 0.7 8.9 3.2 0.2 1.4 3.9 — 23.5 Sustaining capital expenditure(3) 70.1 168.4 37.9 140.0 70.0 21.4 90.3 42.8 — 640.8 All-in sustaining costs(1) 349.3 545.0 185.2 344.3 222.5 82.3 236.7 74.4 13.9 2,053.6 Exploration, feasibility and evaluation costs(4) — — — — — — — — 47.1 47.1 Non-sustaining capital expenditure(3) 7.8 — — — — — — — 1.3 9.1 All-in costs(1) 357.1 545.0 185.2 344.3 222.5 82.3 236.7 74.4 62.0 2,109.4 Gold only ounces sold (‘000oz) 289.4 568.1 147.7 362.9 229.3 66.4 283.8 149.1 — 2,096.8 All-in sustaining cost 349.3 545.0 185.2 344.3 222.5 82.3 236.7 74.0 13.9 2,053.6 All-in sustaining cost net of by-product revenue per ounce of gold sold (U.S.$/oz) 1,207 959 1,254 949 971 1,238 834 499 — 980 All-in costs 357.1 545.0 185.2 344.3 222.5 82.3 236.7 74.0 62.0 2,109.4 All-in costs net of by-product revenue per ounce of gold sold (U.S.$) 1,234 959 1,254 949 971 1,238 834 499 — 1,006 Notes: (1) This total may not reflect the sum of the line items due to rounding. (2) By-product revenue at Cerro Corona relates to copper. For all the other operations, by-product revenue relates to silver. (3) Sustaining capital expenditure represents the majority of capital expenditures at existing operations, including underground mine development costs, ongoing replacement of mine equipment and other capital facilities and other capital expenditures at existing operations and is calculated as total capital expenditure per note 41 to the consolidated financial statements, less non-sustaining capital expenditures. Non-sustaining capital expenditures represent capital expenditures for major growth projects as well as enhancement capital for significant infrastructure improvements at existing operations. (4) Includes exploration, feasibility and evaluation and share of equity accounted losses of Far Southeast Gold Resources Incorporated. 162 Table of Contents AISC and AIC, gross of by-product revenue per ounce of gold For the year ended December 31, 2016 South Deep Tarkwa Damang St. Ives Agnew/ Lawlers Darlot Granny Smith Cerro Corona Corporate and other Group(1) (in U.S.$ million except as otherwise stated) All-in sustaining costs (per table above) 349.3 545.0 185.2 344.3 222.5 82.3 236.7 74.4 13.9 2,053.6 Add back by-product revenue(2) 0.5 1.5 0.1 0.8 0.2 0.3 0.1 130.6 — 134.1 All-in sustaining costs gross of by-product revenue 349.8 546.5 185.2 345.1 222.8 82.5 236.8 205.0 13.9 2,187.7 All-in costs (per table above) 357.1 545.0 185.2 344.3 222.5 82.3 236.7 74.4 61.5 2,109.5 Add back by-product revenue(2) 0.5 1.5 0.1 0.8 0.2 0.3 0.1 130.6 — 134.1 All-in costs gross of by-product revenue 357.6 546.5 185.2 345.1 222.8 82.5 236.8 205.0 61.5 2,243.6 Gold equivalent ounces sold 289.4 568.1 147.7 362.9 229.3 66.4 283.8 268.9 — 2,216.4 All-in sustaining costs gross of by-product revenue (U.S.$/equivalent oz) 1,209 962 1,254 951 972 1,243 834 762 — 987 All-in costs gross of by-product revenue (U.S.$/equivalent oz) 1,236 962 1,254 951 972 1,243 834 762 — 1,012 Notes: (1) This total may not reflect the sum of the line items due to rounding. (2) By-product revenue at Cerro Corona relates to copper. For all the other operations, by-product revenue relates to silver. AISC net of by-product revenues decreased by 3% from U.S.$1,007 per ounce of gold in fiscal 2015 to U.S.$980 per ounce of gold in fiscal 2016, mainly due to lower operating costs (including gold inventory change), lower losses on commodity cost hedges, higher by-product credits, partially offset by higher non-cash and cash remuneration and higher sustaining capital expenditure. AISC in fiscal 2015 included U.S.$8 million of inventory written off at Damang. AIC net of by-product revenues decreased by 2% from U.S.$1,026 per ounce of gold in fiscal 2015 to U.S.$1,006 per ounce of gold in fiscal 2016, for the same reasons as AISC, as well as lower non-sustaining capital expenditure, partially offset by higher exploration, feasibility and evaluation costs. AISC gross of by-product revenues decreased by 1% from U.S.$1,000 per equivalent ounce of gold in fiscal 2015 to U.S.$987 per equivalent ounce of gold in fiscal 2016 mainly due to lower operating costs (including gold inventory change) and lower losses on commodity cost hedges, partially offset by higher non-cash and cash remuneration and higher sustaining capital expenditure. AIC gross of by-product revenues decreased by 1% from U.S.$1,018 per equivalent ounce of gold in fiscal 2015 to U.S.$1,012 per equivalent ounce of gold in fiscal 2016, for the same reasons as AISC gross of product revenue, as well as lower non-sustaining capital expenditure, partially offset by higher exploration, feasibility and evaluation costs. 163 Table of Contents AISC and AIC, net of by-product revenue per ounce of gold For the year ended December 31, 2015 South Deep Tarkwa Damang St. Ives Agnew/ Lawlers Darlot Granny Smith Cerro Corona Corporate and other Group(1) (in U.S.$ million except as otherwise stated) Operating costs 236.6 334.2 184.3 195.0 142.6 59.8 135.9 143.8 (0.8 ) 1,431.3 Gold inventory change — (7.3 ) 2.1 25.3 (1.1 ) (0.6 ) 5.4 1.0 — 24.9 Inventory write-off — — 8.0 — — — — — — 8.0 Royalties 1.2 34.0 9.7 10.7 6.6 2.1 8.7 3.1 — 76.0 Realized gains and losses on commodity cost hedges — — — 5.0 1.5 0.5 5.2 — — 12.1 Community/social responsibility costs 1.7 2.1 0.2 — — — — 8.3 — 12.2 Non-cash remuneration (share-based payments) 1.0 1.5 0.3 1.2 0.7 0.2 0.4 1.2 4.4 10.9 Cash remuneration (long-term employee benefits) 1.0 1.4 0.4 0.2 0.5 0.2 0.3 0.8 0.6 5.3 Other — — — — — — — — 8.5 8.5 By-product revenue(2) (0.4 ) (5.5 ) — (0.5 ) (0.3 ) (0.2 ) (0.1 ) (113.8 ) — (120.7 ) Rehabilitation amortization and interest 0.8 3.7 0.6 8.9 3.4 0.8 1.8 4.9 — 25.0 Sustaining capital expenditure(3) 53.2 204.2 16.9 114.5 73.0 20.0 72.4 64.8 — 619.9 All-in sustaining costs(1) 295.1 568.2 222.5 360.2 226.8 82.9 230.0 114.0 12.7 2,113.3 Exploration, feasibility and evaluation costs(4) — — — — — — — — 26.0 26.0 Non-sustaining capital expenditure(3) 13.7 — — — — — — — 0.5 14.2 All-in costs(1) 308.8 568.2 222.5 360.2 226.8 82.9 230.0 114.0 39.2 2,153.5 Gold only ounces sold (‘000oz) 198.0 586.1 167.8 371.9 236.6 78.4 301.1 158.8 — 2,098.8 All-in sustaining cost 295.1 568.2 222.5 360.2 226.8 82.9 230.0 114.0 12.7 2,113.3 All-in sustaining cost net of by-product revenue per ounce of gold sold (U.S.$/oz) 1,490 970 1,326 969 959 1,057 764 718 — 1,007 All-in costs 308.8 568.2 222.5 360.2 226.8 82.9 230.0 114.0 39.2 2,153.5 All-in costs net of by-product revenue per ounce of gold sold (U.S.$) 1,559 970 1,326 969 959 1,057 764 718 — 1,026 Notes: (1) This total may not reflect the sum of the line items due to rounding. (2) By-product revenue at Cerro Corona relates to copper. For all the other operations, by-product revenue relates to silver. (3) Sustaining capital expenditure represents the majority of capital expenditures at existing operations, including underground mine development costs, ongoing replacement of mine equipment and other capital facilities and other capital expenditures at existing operations and is calculated as total capital expenditure per note 41 to the consolidated financial statements, less non-sustaining capital expenditures. Non-sustaining capital expenditures represent capital expenditures for major growth projects as well as enhancement capital for significant infrastructure improvements at existing operations. (4) Includes exploration, feasibility and evaluation and share of equity accounted losses of Far Southeast Gold Resources Incorporated. 164 Table of Contents AISC and AIC, gross of by-product revenue per ounce of gold For the year ended December 31, 2015 South Deep Tarkwa Damang St. Ives Agnew/ Lawlers Darlot Granny Smith Cerro Corona Corporate and other Group(1) (in U.S.$ million except as otherwise stated) All-in sustaining costs (per table above) 295.1 568.2 222.5 360.2 226.8 82.9 230.0 114.0 12.7 2,113.3 Add back by-product revenue(2) 0.4 5.5 — 0.5 0.3 0.2 0.1 113.8 — 120.7 All-in sustaining costs gross of by-product revenue 295.5 573.7 222.5 360.7 227.1 83.1 230.1 227.8 12.7 2,234.0 All-in costs (per table above) 308.8 568.2 222.5 360.2 226.8 82.9 230.0 114.0 39.2 2,153.5 Add back by-product revenue(2) 0.4 5.5 — 0.5 0.3 0.2 0.1 113.8 — 120.7 All-in costs gross of by-product revenue 309.2 573.7 222.5 360.7 227.1 83.1 230.1 227.8 39.2 2,274.2 Gold equivalent ounces sold 198.0 586.1 167.8 371.9 236.6 78.4 301.1 293.3 — 2,233.3 All-in sustaining costs gross of by-product revenue (U.S.$/equivalent oz) 1,492 979 1,326 970 960 1,059 764 777 — 1,000 All-in costs gross of by-product revenue (U.S.$/equivalent oz) 1,561 979 1,326 970 960 1,059 764 777 — 1,018 Notes: (1) This total may not reflect the sum of the line items due to rounding. (2) By-product revenue at Cerro Corona relates to copper. For all the other operations, by-product revenue relates to silver. AISC net of by-product revenues decreased by 4% from U.S.$1,053 per ounce of gold in fiscal 2014 to U.S.$1,007 per ounce of gold in fiscal 2015, mainly due to lower operating costs, the weaker average R/US dollar and A$/US dollar gold price, partially offset by lower by-product credits and higher capital expenditure. AISC net of by-product revenues decreased by 6% from U.S.$1,087 per ounce of gold in fiscal 2014 to U.S.$1,026 per ounce of gold in fiscal 2015, due to the lower exploration, feasibility and evaluation costs and lower non-sustaining capital expenditure. AISC gross of by-product revenues decreased by 5% from U.S.$1,053 per equivalent ounce of gold in fiscal 2014 to U.S.$1,000 per equivalent ounce of gold in fiscal 2015, mainly due to lower operating costs, the weaker average R/US dollar and A$/US dollar gold price, partially offset by higher capital expenditure. AIC gross of by-product revenues decreased by 6% from U.S.$1,086 per equivalent ounce of gold in fiscal 2014 to U.S.$1,018 per equivalent ounce of gold in fiscal 2015, due to lower exploration, feasibility and evaluation costs and lower non-sustaining capital expenditure. 165 Table of Contents AISC and AIC, net of by-product revenue per ounce of gold For the year ended December 31, 2014 South Deep Tarkwa Damang St. Ives Agnew/ Lawlers Darlot Granny Smith Cerro Corona Corporate and other Group(1) (in U.S.$ million except as otherwise stated) Operating costs 245.5 373.9 177.6 292.3 173.0 81.9 182.6 158.2 — 1,684.9 Gold inventory change — (2.3 ) 2.1 (9.9 ) (0.3 ) 1.7 — 1.5 — (7.2 ) Royalties 1.3 35.3 11.2 11.6 8.3 2.7 10.0 5.8 — 86.1 Realized gains and losses on commodity cost hedges — — — 0.1 (0.1 ) — 0.3 — — 0.3 Community/social responsibility costs 3.9 1.2 0.2 — — — — 7.0 — 12.3 Non-cash remuneration (share-based payments) 2.8 4.2 0.6 2.7 1.3 0.5 1.0 2.6 10.2 26.0 Cash remuneration (long-term employee benefits 0.6 1.5 0.2 1.2 0.7 0.4 0.7 1.2 2.1 8.7 Other — — — — — — — — 10.6 10.6 By-product revenue(2) (0.5 ) (0.5 ) (0.1 ) (0.5 ) (0.3 ) (0.3 ) (0.1 ) (182.1 ) — (184.5 ) Rehabilitation amortization and interest 1.8 9.0 1.1 6.1 2.0 0.5 1.7 3.3 — 25.5 Sustaining capital expenditure(3) 54.9 174.1 16.0 117.5 83.4 14.7 58.9 51.0 — 570.4 All-in sustaining costs(1) 310.3 596.5 208.9 421.0 267.9 102.2 255.1 48.5 22.9 2,232.9 Exploration, feasibility and evaluation costs(4) — — — — — — — — 34.6 34.6 Non-sustaining capital expenditure(3) 37.0 — — — — — — — 1.5 38.5 All-in costs(1) 347.2 596.5 208.9 421.0 267.9 102.2 255.1 48.5 59.0 2,306.0 Gold only ounces sold (‘000oz) 200.5 558.3 177.8 361.7 270.7 83.6 315.2 153.6 — 2,121.4 All-in sustaining cost 310.3 596.5 208.9 421.0 267.9 102.2 255.1 48.5 22.9 2,232.9 All-in sustaining cost net of by-product revenue per ounce of gold sold (U.S.$/oz) 1,548 1,068 1,175 1,164 990 1,222 809 316 — 1,053 All-in costs 347.2 596.5 208.9 421.0 267.9 102.2 255.1 48.5 59.0 2,306.0 All-in costs net of by-product revenue per ounce of gold sold (U.S.$) 1,732 1,068 1,175 1,164 990 1,222 809 316 — 1,087 Notes: (1) This total may not reflect the sum of the line items due to rounding. (2) By-product revenue at Cerro Corona relates to copper. For all the other operations, by-product revenue relates to silver. (3) Sustaining capital expenditure represents the majority of capital expenditures at existing operations, including underground mine development costs, ongoing replacement of mine equipment and other capital facilities and other capital expenditures at existing operations and is calculated as total capital expenditure per note 41 to the consolidated financial statements, less non-sustaining capital expenditures. Non-sustaining capital expenditures represent capital expenditures for major growth projects as well as enhancement capital for significant infrastructure improvements at existing operations. (4) Includes exploration, feasibility and evaluation and share of equity accounted losses of Far Southeast Gold Resources Incorporated. 166 Table of Contents AISC and AIC, gross of by-product revenue per ounce of gold For the year ended December 31, 2014 South Deep Tarkwa Damang St. Ives Agnew/ Lawlers Darlot Granny Smith Cerro Corona Corporate and other Group(1) (in U.S.$ million except as otherwise stated) All-in sustaining costs (per table above) 310.3 596.5 208.9 421.0 267.9 102.2 255.1 48.5 22.9 2,232.9 Add back by-product revenue(2) 0.5 0.5 0.1 0.5 0.3 0.3 0.1 182.1 — 184.5 All-in sustaining costs gross of by-product revenue 310.8 597.0 209.0 421.5 268.3 102.5 255.2 230.6 22.9 2,417.4 All-in costs (per table above 347.2 596.5 208.9 421.0 267.9 102.2 255.1 48.5 59.0 2,306.0 Add back by-product revenue(2) 0.5 0.5 0.1 0.5 0.3 0.3 0.1 182.1 — 184.5 All-in costs gross of by-product revenue 347.7 597.0 209.0 421.5 268.3 102.5 255.2 230.6 59.0 2,490.5 Gold equivalent ounces sold 200.5 558.3 177.8 361.7 270.7 83.6 315.2 328.6 — 2,296.2 All-in sustaining costs gross of by-product revenue (U.S.$/equivalent oz) 1,550 1,069 1,175 1,165 991 1,225 810 702 — 1,053 All-in costs gross of by-product revenue (U.S.$/equivalent oz) 1,734 1,069 1,175 1,165 991 1,225 810 702 — 1,086 Notes: (1) This total may not reflect the sum of the line items due to rounding. (2) By-product revenue at Cerro Corona relates to copper. For all the other operations, by-product revenue relates to silver. Royalties South Africa The Royalty Act was promulgated on November 24, 2008 and came into operation on March 1, 2010. The Royalty Act imposes a royalty on refined and unrefined minerals payable to the South African government. The royalty in respect of refined minerals (which include gold and platinum) is calculated by dividing EBIT by the product of 12.5 times gross revenue calculated as a percentage, plus an additional 0.5%. EBIT refers to taxable mining income (with certain exceptions such as no deduction for interest payable and foreign exchange losses) before assessed losses but after capital expenditure. A maximum royalty of 5% is levied on refined minerals. The royalty in respect of unrefined minerals (which include uranium) is calculated by dividing EBIT by the product of nine times gross revenue calculated as a percentage, plus an additional 0.5%. A maximum royalty of 7% is levied on unrefined minerals. Where unrefined mineral resources (such as uranium) constitute less than 10% in value of the total composite mineral resources, the royalty rate in respect of refined mineral resources may be used for all gross 167 Table of Contents sales and a separate calculation of EBIT for each class of mineral resources is not required. For Gold Fields, this means that currently it will pay a royalty based on the refined minerals royalty calculation as applied to its gross revenue. The rate of royalty tax payable for fiscal 2016, 2015 and 2014 was 0.5%, 0.5% and 0.5% of revenue, respectively. Ghana Minerals are owned by the Republic of Ghana and held in trust by the President. As such, in fiscal 2016 the Tarkwa and Damang operations were subject to a gold royalty of 5% of total revenue earned from minerals obtained. In fiscal 2017, under the terms of the Development Agreement entered into with the government of Ghana, Tarkwa and Damang will be subject to a sliding scale for royalty rates, linked to the prevailing gold price. The royalty sliding scale is as follows: Average gold price Low value High value Royalty rate (U.S.$) — 1,299.99 3.0 % 1,300.00 1,449.99 3.5 % 1,450.00 2,299.99 4.1 % 2,300.00 Unlimited 5.0 % Australia Royalties are payable to the state based on the amount of gold produced from a mining tenement. Royalties are payable quarterly at a fixed rate of 2.5% of the royalty value of gold sold. The royalty value of gold is the amount of gold produced during the month multiplied by the average gold spot price for the month. Peru Royalties are calculated with reference to the operating margin and ranging from 1% (for operating margins less than 10%) to 12% (for operating margins of more than 80%). La Cima’s effective royalty rate for fiscal 2016, 2015 and 2014 was 6.4%, 4.0% and 3.3% of operating profit, respectively. Income And Mining Taxes South Africa Generally, South Africa imposes tax on the worldwide income (including capital gains) of all of Gold Fields’ South African incorporated and tax resident entities. Certain classes of passive income such as interest and royalties, and certain capital gains, derived by Controlled Foreign Companies, or CFC, could be subject to South African tax on a notional imputation basis. CFCs generally constitute a foreign company in which Gold Fields owns or controls more than 50% of the shareholding. Gold Fields pays taxes on its taxable income generated by its mining and non-mining tax entities. Under South African law, gold mining companies and non-gold mining companies are taxed at different rates. Companies in the Group not carrying on the direct gold mining operations are taxed at a statutory rate of 28%. GFO and GFIJVH jointly own the South Deep Mine and constitute gold mining companies for South African taxation purposes. These companies are subject to the gold formula on their mining income. The applicable formula takes the form Y = 34 – 170 x 168 Table of Contents Where: Y = the tax rate to be determined x = the ratio of taxable income to the total income (expressed as a percentage) The effective mining tax rate for GFO and GFIJVH, owners of the South Deep mine, has been calculated at 30% (2015: 30% and 2014: 30%). Ghana Ghanaian resident entities are subject to tax on the basis of income derived from, accruing in, received in, or brought into Ghana. The standard corporate income tax rate applicable to mining companies was 35%. Gold Fields signed a Development Agreement with the government of Ghana for both the Tarkwa and Damang mines during 2016. This agreement resulted in a reduction in the corporate tax rate from 35% to 32.5%, effective March 17, 2016. Under the previous project development agreement (entered into between the Ghanaian government and Gold Fields Ghana) and the deed of warranty (entered into between the Ghanaian government and Abosso Goldfields), the government agreed that no withholding tax shall be deducted from the payment of any dividend or capital repayment declared by Gold Fields Ghana or Abosso which was due and payable to any shareholder not normally resident in Ghana. The new Development Agreement which became effective March 17, 2016, did not cover any withholding tax on dividends and accordingly, future dividends out of Ghana will be subject to 8% withholding tax. Implementation of Ghana’s Income Tax Act 2015, Act 896 continues, while awaiting issuance of supporting practice and guidance notes by the tax authorities. In August 2016, the Income Tax Regulations (L.I. 2244) were entered into force. While LI 2244 has clarified a number of uncertainties with regards to the implementation of Act 896 (such as unutilized capital allowances and ring-fencing), the industry continues to dialogue with the government and with the tax authorities for even further clarity as gaps still persist. The Revenue Administration Act, 2016 (Act 915), or Act 915, was gazetted in August 2016 and enters into force from January 1, 2017. Act 915 consolidates tax administration provisions from the various tax laws (income tax, value added tax, customs) into a single act and introduces a more stringent tax compliance framework. Act 915 now enables taxpayers to offset surpluses and liabilities arising from different tax types. It should be noted that the tax authorities are again expected to release guidance notes to allow taxpayers to fully utilize the offset mechanism. Australia Generally, Australia imposes tax on the worldwide income (including capital gains) of all of Gold Fields’ Australian incorporated and tax resident entities. The current income tax rate for companies is 30%. Exploration expenditure is deductible in full as incurred and other capital expenditure is generally deductible over the effective lives of the assets acquired. The Australian Uniform Capital Allowance system allows tax deductions for the decline in value of depreciable assets and certain other capital expenditures. Gold Fields Australia and its eligible related Australian sister companies, together with all wholly-owned Australian subsidiaries, have elected to be treated as a tax consolidated group for taxation purposes. As a tax consolidated group, a single tax return is lodged for the Group based on the consolidated results of all companies within the Group. Withholding tax is payable on dividends, interest and royalties paid by Australian residents to non-residents. In the case of dividend payments to non-residents, withholding tax at a rate of 30% will apply. However, where 169 Table of Contents the recipient of the dividend is a resident of a country with which Australia has concluded a double taxation agreement, the rate of withholding tax is generally limited to between 5% and 15%, depending on the applicable agreement and percentage shareholding. Where dividends are paid out of profits that have been subject to Australian corporate tax there is no withholding tax, regardless of whether a double taxation agreement is in place. Peru Peruvian taxes for resident individuals and domiciled corporations are based on their worldwide income, and for non-resident individuals and non-domiciled corporations are based on their Peruvian income source. The general income tax rate applicable to domiciled corporations is 29.5% on taxable income and to non-resident corporations is 30%. The income tax applied to interest paid to non-residents is 4.99%. The dividends tax rate (to resident and non-resident) is 5%. Capital gains are also taxed as ordinary income for domiciled corporations. Exchange Rates Gold Fields’ Australian and South African revenues and costs are very sensitive to the Australian dollar/US dollar exchange rate and the Rand/U.S. dollar exchange rate, because revenues are generated using a gold price denominated in US dollars, while the costs of the Australian and South African operations are incurred principally in Australian dollars and Rand, respectively. Depreciation of the Australian dollar and Rand against the US dollar reduces Gold Fields’ average costs when they are translated into US dollars, thereby increasing the operating margin of the Australian and South African operations. Conversely, appreciation of the Australian dollar and Rand results in Australian and South African operating costs being translated into US dollars at a lower Australian dollar/US dollar exchange rate and Rand/US dollar exchange rate, resulting in lower operating margins. The impact on profitability of any change in the value of the Australian dollar and Rand against the US dollar can be substantial. Furthermore, the exchange rates obtained when converting US dollars to Australian dollar and Rand are set by foreign exchange markets, over which Gold Fields has no control. In fiscal 2016, movements in the US dollar/Rand exchange rate had a significant impact on Gold Fields’ results of operations as the Rand weakened 16% against the US dollar, from an average of R12.68 per U.S.$1.00 in fiscal 2015 to R14.70 per U.S.$1.00 in fiscal 2016. The Australian dollar was similar at an average of A$1.00 per U.S.$0.75. With respect to its operations in Ghana and Peru, a substantial portion of Gold Fields’ operating costs (including wages) are either directly incurred in US dollars or are translated to US dollars. Accordingly, fluctuations in the Ghanaian Cedi and Peruvian Nuevos Soles do not materially impact operating results for the Ghana and Peru operations. During 2016, Gold Fields had the following currency forward contract: • On February 25, 2016, South Deep entered into U.S.$/Rand forward exchange contracts for a total delivery of U.S.$69.8 million starting at July 2016 to December 2016. The average forward rate achieved over the six month period was R16.8273. The hedge was delivered into in July and August and the balance closed out in September 2016. The average rate achieved on delivery and close out was R13.8010, resulting in a positive cash flow of U.S.$14 million. During 2015, Gold Fields had no currency forward contracts. During 2014, Gold Fields had the following currency forward contract: • On October 1, 2014, South Deep entered into a U.S.$/Rand zero-cost collar for U.S.$7.5 million per month for a period of six months starting October 2014. A floor of R11.2 and an average cap over the period of R12.0567 was achieved. 170 Table of Contents Inflation A period of significant inflation could adversely affect Gold Fields’ results and financial condition. For example, in fiscal 2016, inflation in South Africa was 6.8% (2015: 4.6% and 2014: 6.2%). Further, over the past several years, production costs, especially wages and electricity costs, have increased considerably. The effect of these increases has adversely affected, and may continue to adversely affect, the profitability of Gold Fields’ South Deep operations. In fiscal 2016, the Group continued rationalizing and prioritizing capital expenditure without undermining the sustainability of its operations and continued prioritization of cash generation over production volumes. The Ghanaian operations concluded a Development Agreement with the government of Ghana for both the Tarkwa and Damang mines. The highlights of the agreement included reductions in the tax and royalty rates. The Group undertook reductions in labor costs through a retrenchment process in Damang in preparation for rightsizing for the Damang Reinvestment Plan. In addition, the Australian operations implemented a margin improvement project. In fiscal 2015, the Group undertook reductions in labor costs through completing the retrenchment process in Ghana following the closure of the heap leach facilities at Tarkwa and rightsizing at the Australian operations following the closure of the Cave Rocks underground mine at St. Ives. In addition, the Group implemented various business improvement initiatives to reduce costs across all regions. Further, the majority of Gold Fields’ costs at the South African operations are in Rand and revenues from gold sales are in U.S. dollars. Generally, when inflation is high, the Rand potentially devalues thereby increasing Rand revenues and potentially offsetting the increase in costs. However, there can be no guarantee that any cost-saving measures or the effects of any potential devaluation will offset the effects of increased inflation and production costs. The same applies to the Australian operations with regard to the link between Australian dollars and US dollars. The Peruvian and Ghanaian operations, on the other hand, are affected by inflation without a potential similar effect on revenue proceeds, thereby increasing the impact of inflation on the operating margins. Capital Expenditures Gold Fields will continue to be required to make capital investments in both new and existing infrastructure and opportunities and, therefore, management will be required to continue to balance the demands for capital expenditure in the business and allocate Gold Fields’ resources in a focused manner to achieve its sustainable growth objectives. Gold Fields expects that its use of available capital resources and allocation of its capital expenditures may shift in future periods as it increases investment in certain of its exploration projects. Capital expenditure increased by U.S.$16 million, or 3%, from U.S.$634 million in fiscal 2015 to U.S.$650 million in fiscal 2016. Set out below are the capital expenditures made by Gold Fields during 2016. Also, refer to “Cash Flows From Investing Activities”. South African operation Gold Fields spent R1,145 million (U.S.$78 million) on capital expenditures at the South Deep in fiscal 2016 and has budgeted R1,309 million (U.S.$92.6 million) for capital expenditures at South Deep in fiscal 2017. Ghanaian operations Gold Fields spent U.S.$168 million on capital expenditures at Tarkwa in fiscal 2016 and has budgeted U.S.$180 million for capital expenditures at Tarkwa for fiscal 2017. 171 Table of Contents Gold Fields spent U.S.$38 million on capital expenditures at the Damang in fiscal 2016 and has budgeted U.S.$140 million of capital expenditures at Damang for fiscal 2017. Peruvian operation Gold Fields spent U.S.$43 million on capital expenditures at Cerro Corona in fiscal 2016 and has budgeted U.S.$53 million for capital expenditures at Cerro Corona for fiscal 2017. Australian operations Gold Fields spent A$188 million (U.S.$140 million) on capital expenditures at St. Ives in fiscal 2016 and has budgeted A$185 million (U.S.$135 million) for capital expenditures at St. Ives in fiscal 2017. Gold Fields spent A$94 million (U.S.$70 million) on capital expenditures at Agnew/Lawlers in fiscal 2016 and has budgeted A$87 million (U.S.$64 million) for capital expenditures at Agnew/Lawlers for fiscal 2017. Gold Fields spent A$29 million (U.S.$21 million) on capital expenditures at Darlot in fiscal 2016 and has budgeted A$12 million (U.S.$8 million) for capital expenditures at Darlot for fiscal 2017. Gold Fields spent A$121 million (U.S.$90 million) on capital expenditures at Granny Smith in fiscal 2016 and has budgeted A$115 million (U.S.$84 million) for capital expenditures at Granny Smith for fiscal 2017. Gold Fields has budgeted A$153 million (U.S.$112 million) for capital expenditure at the Gruyere Gold Project for fiscal 2017. The actual expenditures for the future periods noted above may be different from the amounts set out above and the amount of actual capital expenditure will depend on a number of factors, such as production volumes, the price of gold, copper and other minerals mined by Gold Fields and general economic conditions. Some of the factors are outside of the control of Gold Fields. Significant Accounting Judgements And Estimates Gold Fields’ significant accounting policies are more fully described in the accounting policies to its consolidated financial statements included in this annual report. Some of Gold Fields’ accounting policies require the application of significant judgments and estimates by management that can affect the amounts reported in the consolidated financial statements. By their nature, these judgments are subject to a degree of uncertainty and are based on Gold Fields’ historical experience, terms of existing contracts, management’s view on trends in the gold mining industry, information from outside sources and other assumptions that Gold Fields considers to be reasonable under the circumstances. Actual results could differ from these estimates under different assumptions or conditions. Refer to the accounting policies to the consolidated financial statements included elsewhere in this annual report for the more significant areas requiring the use of management judgements and estimates. RESULTS FOR THE PERIOD Years ended December 31, 2016 and December 31, 2015 Profit/(loss) attributable to owners of the parent was a profit of U.S.$163 million (or U.S.$0.20 per share) for fiscal 2016 compared to a loss of U.S.$242 million (or U.S.$0.31 per share) for fiscal 2015. The reasons for this increase are discussed below. Revenue Revenue increased by 8% from U.S.$2,545 million in fiscal 2015 to U.S.$2,750 million in fiscal 2016. The increase in revenue of U.S.$205 million was mainly due to an increase of 9% in the average US dollar gold price 172 Table of Contents for the year from U.S.$1,140 per equivalent ounce in fiscal 2015 to U.S.$1,241 per equivalent ounce in fiscal 2016. The rand weakened by 16% to the US dollar from an average of R12.68 in fiscal 2015 to R14.70 in fiscal 2016 and the average Australian/US dollar exchange rate was similar at A$1=U.S.$0.75. Gold sales decreased by 1% from 2,233,300 equivalent ounces in fiscal 2015 to 2,216,400 equivalent ounces in fiscal 2016. Gold sales at the South African operation increased by 46% from 6,160 kilograms (198,000 ounces) to 9,001 kilograms (289,400 ounces). Gold sales at the Ghanaian operations decreased by 5% from 753,900 ounces to 715,800 ounces. Gold equivalent sales at the Peruvian operation (Cerro Corona) decreased by 8% from 293,300 equivalent ounces to 268,900 equivalent ounces. At the Australian operations, gold sales decreased by 5% from 988,000 ounces to 942,400 ounces. As a general rule, Gold Fields sells all the gold it produces in the year of production. 2016 2015 Revenue Gold sold Gold produced Revenue Gold sold Gold produced (U.S.$ million) (’000) (Ozs) (’000) (Ozs) (U.S.$ million) (’000) (Ozs) (’000) (Ozs) South Deep 358.2 289.4 290.4 232.3 198.0 198.0 Tarkwa 708.9 568.1 568.1 680.7 586.1 586.1 Damang 183.4 147.7 147.7 194.8 167.8 167.8 Cerro Corona 322.3 268.9 270.2 292.2 293.3 295.6 St. Ives 452.3 362.9 362.9 431.8 371.9 371.9 Agnew/Lawlers 285.4 229.3 229.3 273.9 236.6 236.6 Darlot 83.1 66.4 66.4 91.3 78.4 78.4 Granny Smith 355.8 283.8 283.8 348.4 301.1 301.1 Total 2,749.5 2,216.4 2,218.7 2,545.4 2,233.3 2,235.6 At South Deep in South Africa, gold sales increased by 46% from 6,160 kilograms (198,000 ounces) to 9,001 kilograms (289,400 ounces) mainly due to increased volumes and grades. At the Ghanaian operations, gold sales at Tarkwa decreased by 3% from 586,100 ounces to 568,100 ounces due to the lower yield. Damang’s gold sales decreased by 12% from 167,800 ounces to 147,700 ounces mainly due to lower yield. At Cerro Corona in Peru, copper production increased by 7% from 28,702 tonnes to 30,667 tonnes and gold production decreased by 5% from 158,900 ounces to 150,200 ounces. As a result gold equivalent sales decreased by 8% from 293,300 ounces to 268,900 ounces due to lower copper to gold price ratio as well as lower gold head grades treated and lower gold recovery. At the Australian operations, production at St. Ives decreased by 2% from 371,900 ounces to 362,900 ounces due to lower grade or ore milled following the closure of the Cave Rocks and Athena underground mines and transition to a predominantly open pit operation. At Agnew/Lawlers, gold sales decreased by 3% from 236,600 ounces to 229,300 ounces mainly due to a reduction in ore processed. Gold production at Darlot decreased by 15% from 78,400 ounces to 66,400 ounces due to lower grades mined. At Granny Smith, gold production decreased by 6% from 301,100 ounces to 283,800 ounces due to lower grades mined and an increase in stockpiled ore as a consequence of the timing of the December milling campaign. Cost of Sales Cost of sales, which comprise operating costs, gold inventory change and amortization and depreciation, increased marginally from U.S.$2,066 million in fiscal 2015 to U.S.$2,067 million in fiscal 2016. 173 Table of Contents Operating costs Operating costs increased marginally from U.S.$1,431 million in fiscal 2015 to U.S.$1,433 million in fiscal 2016. At South Deep in South Africa, operating costs increased by 33% from R3,000 million (U.S.$237 million) to R4,003 million (U.S.$272 million). This increase of R1,003 million was mainly due to the 47% increase in production, annual salary increases, the electricity increase and an increase in employees and contractors in line with the strategy to sustainably improve all aspects of the operation and to position the mine to achieve the targets set out in the Rebase Plan. At the Ghanaian operations, operating costs decreased by 7% from U.S.$519 million in fiscal 2015 to U.S.$481 million in fiscal 2016. This decrease of U.S.$38 million was mainly at Damang due to lower mining and consumable costs in line with the lower production. It was partially offset by increased costs at Tarkwa. At Tarkwa, operating costs increased by 3% from U.S.$334 million to U.S.$345 million and at Damang, operating costs decreased by 26% from U.S.$184 million to U.S.$136 million. At Cerro Corona in Peru, operating costs of U.S.$144 million in fiscal 2016 were similar to 2015. At the Australian operations, operating costs increased by 2% from A$709 million (U.S.$533 million) in fiscal 2015 to A$720 million (U.S.$537 million) in fiscal 2016. At St. Ives, operating costs remained similar at A$259 million (U.S.$195 million). At Agnew/Lawlers, operating costs increased by 3% from A$190 million (U.S.$143 million) to A$195 million (U.S.$146 million). Operating costs at Darlot decreased by 4% from A$80 million (U.S.$60 million) to A$77 million (U.S.$57 million) due to cost reduction measures applied to mining activities. At Granny Smith, operating costs increased by 4% from A$181 million (U.S.$136 million) to A$189 million (U.S.$141 million) due to additional volumes. Gold inventory change The gold inventory credit to costs of U.S.$46 million in fiscal 2016 compared with a charge to costs of U.S.$25 million in fiscal 2015. At South Deep, the gold inventory credit of Rnil (U.S.$nil) in fiscal 2015 compared with R11 million (U.S.$1 million) in fiscal 2016, due to gold produced not sold at year-end. At Tarkwa, the gold inventory credit of U.S.$7 million in fiscal 2015 compared with U.S.$18 million in fiscal 2016, both due to a build-up of stockpiles. At Damang, the gold inventory charge of U.S.$2 million in fiscal 2015 compared with a credit to costs of U.S.$nil in fiscal 2016, due to a drawdown of stockpiles and gold in circuit in fiscal 2015 compared to a build-up of gold in circuit in fiscal 2016. At Cerro Corona, the gold inventory charge of U.S.$1 million in fiscal 2015 compared with a credit to costs of U.S.$4 million in fiscal 2016, due to a build-up of concentrate inventory in fiscal 2016 compared with a U.S.$1 million drawdown in fiscal 2015. At St. Ives, the charge to costs of A$34 million (U.S.$25 million) in fiscal 2015 compared with a credit to costs of A$15 million (U.S.$11 million), due to a build-up on stockpiles in fiscal 2016 compared with a drawdown of stockpiles in fiscal 2015. At Agnew/Lawlers, the credit to costs of A$2 million (U.S.$1 million) in fiscal 2015 increased to A$7 million (U.S.$5 million) in fiscal 2016, both due to a build-up of stockpiles. 174 Table of Contents At Darlot, the credit to costs of A$1 million (U.S.$1 million) in fiscal 2015 compared with a charge to costs of A$1 million (U.S.$nil) due to a drawdown of gold in circuit in fiscal 2016 compared to a build-up of gold in circuit in fiscal 2015. At Granny Smith, the charge of A$7 million (U.S.$5 million) in fiscal 2015 compared to a credit to costs of A$10 million (U.S.$7 million) due to a build-up of stockpiles in fiscal 2016 compared to a drawdown of stockpiles in fiscal 2015. Amortization and depreciation Depreciation and amortization is calculated on the units-of-production method and is based on current gold production as a percentage of total expected gold production over the lives of the different mines. The table below depicts the changes from December 31, 2015 to December 31, 2016 for proven and probable managed gold and equivalent reserves and for the life-of-mine for each operation and the resulting impact on the amortization charge in fiscal 2016. The amortization in fiscal 2016 was based on the reserves as at December 31, 2015. The life-of-mine information is based on the operations’ strategic plans, adjusted for proven and probable reserve balances. In basic terms, amortization is calculated using the life-of-mine for each operation, which is based on: (1) the proven and probable reserves for the operation at the start of the relevant year (which are taken to be the same as at the end of the prior fiscal year); and (2) the amount of gold produced by the operation during the year. The ore reserve statement as at December 31, 2016 became effective on January 1, 2017. Proved and Probable Mineral Reserves as of Life of mine Amortization and depreciation for the year ended December 31, 2014 December 31, 2015 December 31, 2016 December 31, 2015 December 31, 2016 December 31, 2015 December 31, 2016 (‘000 oz) (years) (U.S.$ million) South Africa region South Deep 38,000 37,300 37,300 81 79 67.9 71.5 West African region Tarkwa(1) 7,500 6,700 6,100 16 15 162.3 184.4 Damang(2) 1,200 1,000 1,700 5 8 26.4 17.8 Americas region Cerro Corona(3) 3,000 2,800 2,400 8 7 100.1 115.6 Australasian region St. Ives 1,800 1,500 1,700 5 5 109.9 144.8 Agnew/Lawlers 900 700 500 4 3 62.0 77.1 Darlot 100 30 100 0.5 1 25.8 14.4 Granny Smith 900 1,300 1,700 9 9 54.1 45.0 Corporate and other — — — — — 1.4 8.6 Total reserves(4) 53,400 51,330 51,500 609.9 679.2 Notes: (1) As of December 31, 2014, December 31, 2015 and December 31, 2016 mineral reserves of 6.742 million ounces, 6.071 million ounces and 5.473 million ounces of gold, respectively, were attributable to Gold Fields, with the remainder attributable to non-controlling shareholders in the Tarkwa operation. (2) As of December 31, 2014, December 31, 2015 and December 31, 2016 mineral reserves of 1.111 million ounces, 0.876 million ounces and 1.506 million ounces of gold, respectively, were attributable to Gold Fields, with the remainder attributable to non-controlling shareholders in the Damang operation. 175 Table of Contents (3) As of December 31, 2014, December 31, 2015 and December 31, 2016 mineral reserves of 2.988 million ounces, 2.763 million ounces and 2.356 million ounces of equivalent gold were attributable to Gold Fields, with the remainder attributable to non-controlling shareholders in the Cerro Corona operation. (4) As of December 31, 2014, December 31, 2015 and December 31, 2016 reserves of 48.123 million ounces, 47.292 million ounces and 49.172 million ounces of equivalent gold, respectively, were attributable to Gold Fields, with the remainder attributable to non-controlling shareholders in the Ghanaian and Peruvian operations. Amortization and depreciation increased by 11% from U.S.$610 million in fiscal 2015 to U.S.$679 million in fiscal 2016. At South Deep in South Africa, amortization and depreciation increased by 22% from R861 million (U.S.$68 million) in fiscal 2015 to R1,051 million (U.S.$72 million) mainly due to an increase in production. At the Ghanaian operations, amortization and depreciation increased by 7% from U.S.$189 million in fiscal 2015 to U.S.$202 million in fiscal 2016. Tarkwa increased by 14% from U.S.$162 million to U.S.$184 million mainly due to a reduction in reserves. Damang decreased by 31% from U.S.$26 million to U.S.$18 million mainly due to the asset specific impairment at Damang at the end of 2015 and a decrease in production in fiscal 2016. At Cerro Corona in Peru, amortization and depreciation increased by 16% from U.S.$100 million in fiscal 2015 to U.S.$116 million in fiscal 2016. This increase is due to reduction in gold and copper reserves. At the Australian operations, amortization and depreciation increased by 13%, from A$335 million (U.S.$252 million) in fiscal 2015 to A$377 million (U.S.$281 million) in fiscal 2016. At St. Ives, amortization and depreciation increased by 33% from A$146 million (U.S.$110 million) in fiscal 2015 to A$194 million (U.S.$145 million) due to a decrease in reserves. Agnew/Lawlers increased by 26% from A$82 million (U.S.$62 million) in fiscal 2015 to A$103 million (U.S.$77 million) mainly due to a decrease in reserves. amortization and depreciation at Darlot decreased by 44% from A$34 million (U.S.$26 million) to A$19 million (U.S.$14 million) mainly due to the cash-generating unit impairment at Darlot at the end of 2015 and lower production in fiscal 2016. At Granny Smith, amortization and depreciation decreased by 15% from A$72 million (U.S.$54 million) to A$61 million (U.S.$45 million) due to lower production. 176 Table of Contents All-in sustaining and total all-in cost The following table sets out for each operation and the Group, total gold sales in ounces, all-in sustaining costs and total all-in cost, net of by-product revenue, in U.S.$/oz for fiscal 2016 and fiscal 2015: 2016 2015 Gold only ounces sold All-in sustaining costs(2) Total-all in cost(2) Gold only ounces sold All-in sustaining costs(2) Total-all in cost(3) (Ozs) (U.S.$/oz) (U.S.$/oz) (Ozs) (U.S.$/oz) (U.S.$/oz) South Deep 289.4 1,207 1,234 198.0 1,490 1,559 South African operation 289.4 1,207 1,234 198.0 1,490 1,559 Tarkwa 568.1 959 959 586.1 970 970 Damang 147.7 1,254 1,254 167.8 1,326 1,326 Ghanaian operations 715.8 1,020 1,020 753.9 1,049 1,049 Cerro Corona(1) 149.1 499 499 158.8 718 718 Peruvian operation 149.1 499 499 158.8 718 718 St. Ives 362.9 949 949 371.9 969 969 Agnew/Lawlers 229.3 971 971 236.6 959 959 Darlot 66.4 1,238 1,238 78.4 1,057 1,057 Granny Smith 283.8 834 834 301.1 764 764 Australian operations 942.4 940 940 988.0 912 912 GIP and Corporate — 7 30 — 6 19 Total operations 2,096.8 980 1,006 2,098.8 1,007 1,026 Notes: (1) Gold sold at Cerro Corona excludes copper equivalents of 119,800 ounces in fiscal 2016 and 134,500 ounces in fiscal 2015. (2) Net of by product revenue. (3) All-in costs are calculated in accordance with the WGC Industry standard. Refer to page 162 for detailed calculations and discussion of non-IFRS measures. (4) Figures above may not add as they are rounded independently. The Group AISC decreased by 3% from U.S.$1,007 per ounce in fiscal 2015 to U.S.$980 per ounce in fiscal 2016 mainly due to lower net operating costs, lower losses on commodity cost hedges, higher by-product credits, partially offset by higher non-cash and cash remuneration and higher sustaining capital expenditure. AISC in fiscal 2015 included U.S.$8 million of inventory written off at Damang. AIC decreased by 2% from U.S.$1,026 per ounce in fiscal 2015 to U.S.$1,006 per ounce in fiscal 2016 for the same reasons as AISC, as well as lower non-sustaining capital expenditure, partially offset by higher exploration, feasibility and evaluation costs. At South Deep in South Africa, AISC decreased by 6% from R607,429 per kilogram (U.S.$1,490 per ounce) in fiscal 2015 to R570,303 per kilogram (U.S.$1,207 per ounce) in fiscal 2016 mainly due to increased gold sold, partially offset by higher operating costs and higher sustaining capital expenditure. The AIC decreased by 8% from R635,622 per kilogram (U.S.$1,559 per ounce) to R583,059 per kilogram (U.S.$1,234 per ounce) due to the same reasons as for AISC as well as lower non-sustaining capital expenditure. At the Ghanaian operations, AISC and total AIC decreased by 3% from U.S.$1,049 per ounce in fiscal 2015 to U.S.$1,020 per ounce in fiscal 2016 mainly due to lower net operating costs and lower capital expenditure, partially offset by lower gold sold. At Tarkwa, AISC and AIC decreased by 1% from U.S.$970 per ounce in fiscal 2015 to U.S.$959 per ounce in fiscal 2016 due to lower capital expenditure, partially offset by lower gold sold. At Damang, AISC and total AIC decreased by 5% from U.S.$1,326 per ounce in fiscal 2015 to U.S.$1,254 per ounce in fiscal 2016 due to lower net operating costs, partially offset by lower gold sold and higher capital expenditure. 177 Table of Contents At Cerro Corona in Peru, AISC and AIC decreased by 31% from U.S.$718 per ounce in fiscal 2015 to U.S.$499 per ounce in fiscal 2016 mainly due to lower net operating costs, lower sustaining capital expenditure and higher by-product credits, partially offset by lower gold sold. AISC and total AIC per equivalent ounce decreased by 2% from U.S.$777 per equivalent ounce to U.S.$762 per equivalent ounce mainly due to the same reasons as above. At the Australian operations, AISC and AIC increased by 4% from A$1,211 per ounce (U.S.$912 per ounce) in fiscal 2015 to A$1,261 per ounce (U.S.$941 per ounce) in fiscal 2016 mainly due to higher capital expenditure and lower gold sold, partially offset by lower net operating costs. At St. Ives, AISC and AIC decreased by 1% from A$1,287 per ounce (U.S.$969 per ounce) in fiscal 2015 to A$1,273 per ounce (U.S.$949 per ounce) in fiscal 2016 due to the significant reduction in net operating costs, partially offset by lower gold sold and higher capital expenditure. At Agnew/Lawlers, AISC and AIC increased by 2% from A$1,276 per ounce (U.S.$959 per ounce) in fiscal 2015 to A$1,301 per ounce (U.S.$971 per ounce) in fiscal 2016 due to lower gold sold, partially offset by lower capital expenditure. At Darlot, AISC and total AIC increased by 18% from A$1,403 per ounce (U.S.$1,057 per ounce) in fiscal 2015 to A$1,662 per ounce (U.S.$1,238 per ounce) in fiscal 2016 due to lower gold sold and higher capital expenditure, partially offset by lower net operating costs. At Granny Smith, AISC and AIC increased by 10% from A$1,017 per ounce (U.S.$764 per ounce) in fiscal 2015 to A$1,119 per ounce (U.S.$834 per ounce) in fiscal 2016 mainly due to lower gold sold and higher capital expenditure, partially offset by the lower net operating costs. Net Operating Profit Net operating profit increased by 43% from U.S.$479 million in fiscal 2015 to U.S.$683 million in fiscal 2016. This is due to reasons discussed earlier. Investment Income Income from investments increased by 33% from U.S.$6 million in fiscal 2015 to U.S.$8 million in fiscal 2016. The increase was mainly due to higher cash balances at the international operations in fiscal 2016. The investment income in fiscal 2016 of U.S.$8 million comprised U.S.$1 million interest on monies invested in the South African rehabilitation trust fund and U.S.$7 million interest on other cash and cash equivalent balances. The investment income in fiscal 2015 of U.S.$6 million comprised U.S.$nil interest on monies invested in the South African rehabilitation trust fund and U.S.$6 million interest on other cash and cash equivalent balances. Interest received on the South African rehabilitation trust fund increased marginally from U.S.$nil in fiscal 2015 to U.S.$1 million in fiscal 2016. Interest on other cash balances increased by 17% from U.S.$6 million in fiscal 2015 to U.S.$7 million in fiscal 2016 mainly due to higher cash balances at the international operations in fiscal 2016. Finance Expense Finance expense decreased by 6% from U.S.$83 million in fiscal 2015 to U.S.$78 million in fiscal 2016. The finance expense of U.S.$78 million in fiscal 2016 comprised U.S.$11 million relating to the accretion of the environmental rehabilitation liability and U.S.$82 million on various Group borrowings, partially offset by borrowing costs capitalized of U.S.$15 million. 178 Table of Contents The finance expense of U.S.$83 million in fiscal 2015 comprised U.S.$12 million relating to the accretion of the environmental rehabilitation liability and U.S.$88 million on various Group borrowings, partially offset by borrowing costs capitalized of U.S.$17 million. The environmental rehabilitation liability accretion expense decreased from U.S.$12 million in fiscal 2015 to U.S.$11 million in fiscal 2016 mainly due to lower present values of the rehabilitation liabilities which resulted from the lower discount rates used in the 2015 rehabilitation liabilities calculation. Below is an analysis of the components making up the interest on the various Group borrowings, stated on a comparative basis: 2016 2015 (U.S.$ million) Interest on borrowings to fund capital expenditure and operating costs at the South African operation 6 3 Interest on U.S.$1 billion notes issue 44 50 Sibanye Gold guarantee fee — 1 Interest on U.S.$70 million senior secured revolving credit facility 2 2 Interest on U.S.$150 million revolving senior secured credit facility 3 3 Interest on U.S.$1,510 million term loan and revolving credit facilities 12 28 Interest on U.S.$1,290 million term loan and revolving credit facilities 14 — Other interest charges 1 1 82 88 Interest on borrowings to fund capital expenditure and operating costs at the South African operation increased from U.S.$3 million in fiscal 2015 to U.S.$6 million in fiscal 2016 due to drawdowns of South African borrowings in fiscal 2016. Interest on the U.S.$1 billion notes issue decreased from U.S.$50 million in fiscal 2015 to U.S.$44 million in fiscal 2016. The decrease is due to the buy-back of notes amounting to U.S.$148 million during 2016. The yearly guarantee fee of U.S.$5 million became payable to Sibanye Gold in fiscal 2013 after the unbundling of Sibanye Gold. On April 24, 2015, Sibanye Gold was released as guarantor, resulting in a pro-rata guarantee fee of U.S.$1 million in fiscal 2015. Interest on the U.S.$70 million senior secured revolving credit facility remained flat at U.S.$2 million. Interest on the U.S.$150 million revolving senior secured credit facility remained flat at U.S.$3 million. Interest on the U.S.$1,510 million term loan and revolving credit facilities decreased from U.S.$28 million in fiscal 2015 to U.S.$12 million in fiscal 2016. The decrease is due to the U.S.$1,510 million term loan and revolving credit facilities being cancelled and refinanced through the U.S.$1,290 million term loan and revolving credit facilities on June 6, 2016. Interest on the U.S.$1,290 million term loan and revolving credit facilities from the date of refinancing was U.S.$14 million. During 2016, U.S.$15 million (2015: U.S.$17 million) of borrowing costs were capitalized in terms of IAS 23 Borrowing Cost. IAS 23 requires capitalization of borrowing costs whenever general borrowings are used to finance qualifying projects. The only qualifying project was South Deep’s mine development. An average interest capitalization rate of 4.7% (2015: 4.8%) was applied. 179 Table of Contents Gain/(Loss) on Financial Instruments The gain/(loss) on financial instruments was a gain of U.S.$14 million in fiscal 2016 compared to a loss of U.S.$5 million in fiscal 2015. The gain on financial instruments of U.S.$14 million in fiscal 2016 comprised the profit on the South Deep currency hedge. On February 25, 2016, South Deep entered into U.S.$/Rand forward exchange contracts for a total delivery of U.S.$69.8 million starting at July 2016 to December 2016. The average forward rate achieved over the six month period was R16.8273. The hedge was delivered into in July and August and the balance closed out in September 2016. The average rate achieved on delivery and close out was R13.8010, resulting in a positive cash flow and a profit of U.S.$14 million. The loss on financial instruments of U.S.$5 million in fiscal 2015 comprised the loss on the Australian diesel hedges. On September 10, 2014, GFA entered into a Singapore Gasoil 10ppm cash settled swap transaction contract for a total of 136,500 barrels, effective September 15, 2014 until March 31, 2015 at a fixed price of U.S.$115.00 per barrel. The 136,500 barrels are based on 50% of usage for the seven month period from September 2014 to March 2015. Brent Crude at the time of the transaction was U.S.$99.10 per barrel. On November 26, 2014, GFA entered into further contracts. A contract for 63,000 barrels for the period from January to March 2015 was committed at a fixed price of U.S.$94.00 per barrel and a further 283,500 barrels was committed at a price of U.S.$96.00 per barrel for the period from April to December 2015. Brent Crude at the time of the transaction was U.S.$78.50 per barrel. By entering into the above contracts, the Australian region hedged its full diesel requirements for fiscal 2015. At December 31, 2015, the fair value of these oil derivative contracts was negative U.S.$2 million. At December 31, 2016, there were no derivative contracts outstanding. Foreign Exchange (Loss)/Gain The foreign exchange (loss)/gain was a loss of U.S.$6 million in fiscal 2016 compared to a gain of U.S.$10 million in fiscal 2015. These gains and losses on foreign exchange related to the conversion of offshore cash holdings into their functional currencies. The exchange loss of U.S.$6 million was mainly due to the weakening of the Ghanaian Cedi, while the gains of U.S.$10 million in fiscal 2015 were mainly due to the weakening of the Australian Dollar. Other Costs, Net Other costs, net decreased by 19% from U.S.$21 million in fiscal 2015 to U.S.$17 million in fiscal 2016. The costs in fiscal 2016 are mainly made up of: • Social contributions and sponsorships of U.S.$19 million; • Facility charges of U.S.$8 million on borrowings; • Offshore structure costs of U.S.$9 million; • Corporate related costs of U.S.$4 million; • GFA margin improvement project of U.S.$5 million; 180 Table of Contents • Profit of U.S.$18 million on the buy-back of notes; and • Rehabilitation income of U.S.$10 million as a result of changes in estimates relating to the provision for environmental rehabilitation costs recognized in profit or loss. The costs in fiscal 2015 are mainly made up of: • Social contributions and sponsorships of U.S.$12 million; • Facility charges of U.S.$2 million on borrowings; • Offshore structure costs of U.S.$13 million; • Global compliance costs of U.S.$4 million; and • Rehabilitation income of U.S.$15 million as a result of changes in estimates relating to the provision for environmental rehabilitation costs recognized in profit or loss. Share-Based Payments Gold Fields recognizes the cost of share options granted (share-based payments) in terms of IFRS 2, Share-based payment. Gold Fields has adopted appropriate valuation models (Black-Scholes and Monte Carlo simulation) to fair value share-based payments. The value of the share options is determined at the grant date of the options and depending on the rules of the plan expensed on a straight-line basis over a three-year vesting period, adjusted for forfeitures as appropriate. Share-based payments increased by 27% from U.S.$11 million in fiscal 2015 to U.S.$14 million in fiscal 2016. The corresponding entry for the above adjustments was share-based payment reserve within shareholders’ equity. The increase in share-based payments was due to the adoption of the revised 2012 Share Plan during 2016 to replace the LTIP. Long-Term Incentive Plan Expense Gold Fields recognizes the long-term incentive plan expense in terms of IAS 19, Employee benefits. On March 1, 2014, the Remuneration Committee approved the Long-term Cash Incentive Plan, or LTIP. The plan provides for executive directors, certain officers and employees to receive a cash award conditional on the achievement of specified performance conditions relating to total shareholder return and FCF Margin. The conditions are assessed over the performance cycle which runs over three calendar years. The expected timing of the cash outflows in respect of each grant is at the end of three years after the original award was made. These awards are measured on the date the award is made and re-measured at each reporting period. The total shareholder return portion of the award is measured using the Monte Carlo simulation valuation model, which requires assumptions regarding the share price volatility and expected dividend yield. The fair value of the free cash flow portion of the award is valued based on the actual and expected achievement of the cash flow targets set out in the plan. The assumptions used in the Monte Carlo model and the expected cash flow targets are reviewed at each reporting date. No allocations were made under the LTIP in fiscal 2016 following the approval of the revised 2012 Share Plan. 181 Table of Contents The LTIP expense increased by 120% from U.S.$5 million in fiscal 2015 to U.S.$11 million in fiscal 2016. The increase was due to marked-to-market adjustments, as well as additional vestings under the plan. Exploration Expense For fiscal 2016, U.S.$124 million was spent on exploration, comprising brownfields exploration of U.S.$79 million (Australia U.S.$76 million and Ghana U.S.$3 million) and greenfields exploration comprising Salares Norte in Chile (U.S.$39 million), APP in Finland (U.S.$1 million) and U.S.$5 million was spent on exploration office costs. Of the U.S.$124 million exploration costs incurred, U.S.$92 million was recognized in the consolidated income statement of which U.S.$48 million related to Australia. For fiscal 2015, U.S.$95 million was spent on exploration, comprising brownfields exploration of U.S.$72 million (Australia U.S.$68 million, Ghana U.S.$3 million and South Africa U.S.$1 million) and greenfields exploration comprising Salares Norte in Chile (U.S.$16 million), APP in Finland (U.S.$1 million) and U.S.$6 million was spent on exploration office costs. Of the U.S.$95 million exploration costs incurred, U.S.$54 million was recognized in the consolidated income statement of which U.S.$31 million related to Australia. Subject to continued exploration success, U.S.$134 million will be spent on exploration in fiscal 2017, comprising brownfields exploration of U.S.$65 million (Australia U.S.$65 million) and greenfields exploration of U.S.$69 million, primarily at Salares Norte. Share Of Results Of Equity Accounted Investees After Taxation Share of results of equity accounted investees after taxation decreased by 67% from a loss of U.S.$6 million in fiscal 2015 to a loss of U.S.$2 million in fiscal 2016. The decrease relates mainly to the reclassification of Hummingbird Resources PLC, or Hummingbird, and Bezant to available-for-sale investments during 2015 and 2016, respectively, when they no longer qualified as equity-accounted investees. During 2016, Gold Fields only equity accounted for FSE. Restructuring Costs Restructuring costs increased by 33% from U.S.$9 million in fiscal 2015 to U.S.$12 million in fiscal 2016. The cost in fiscal 2016 relates mainly to separation packages in Damang and Granny Smith and the cost in fiscal 2015 relates mainly to separation packages in Tarkwa and St. Ives. Impairment Of Investments And Assets Impairment of investments and assets decreased by 65% from U.S.$221 million in fiscal 2015 to U.S.$77 million in fiscal 2016. The impairment charge of U.S.$77 million in fiscal 2016 comprises: • U.S.$2 million asset specific impairment at Damang, relating to inoperable mining fleet that is no longer used under the current life of mine plan; • U.S.$8 million write down of assets held for sale. Following the Damang re-investment plan, a decision was taken to sell certain mining fleet assets and related spares. The sale of the assets is expected to be concluded during 2017. As a result, the assets were classified as held for sale and valued at the lower of FVLCOD or carrying value which resulted in an impairment; and 182 Table of Contents • U.S.$66 million cash-generating unit impairment at Cerro Corona. The impairment is due to a reduction in gold and copper reserves due to depletion, a decrease in the gold and copper price assumptions for fiscal 2017 and fiscal 2018, a lower resource price and an increase in the Peru tax rate from fiscal 2017 onwards. The impairment charge of U.S.$221 million in fiscal 2015 comprises: • U.S.$8 million net realizable write-downs of stockpiles at Damang; • U.S.$7 million impairment of redundant assets at Cerro Corona; • U.S.$14 million cash-generating unit impairment at Darlot; • U.S.$36 million asset specific impairment at Damang, relating to immovable mining assets that would no longer be used under the current life of mine; • U.S.$39 million at the APP. This project is valued at the lower of fair value less cost of disposal or carrying value after a decision was made to dispose of APP and it was reclassified as held for sale in fiscal 2013. The carrying value at December 31, 2014 was U.S.$40 million based on an offer made as part of the ongoing sale process during 2014. This offer was not realized and during 2015, APP was further impaired by U.S.$39 million to its fair value less cost of disposal; • U.S.$101 million impairment of the Group’s investment in FSE to its recoverable amount; • U.S.$8 million impairment of Hummingbird was recognized to adjust the carrying value of the investment to its fair value upon derecognition of the investment as an equity accounted investee; and • U.S.$8 million related to impairment of listed investments (Hummingbird, Bezant and various junior exploration companies) to their fair values. Profit On Disposal Of Investments The profit on the disposal of investments was U.S.$2 million in fiscal 2016 compared with U.S.$nil in fiscal 2015. The profit on disposal of investments of U.S.$2 million in fiscal 2016 related mainly the profit on disposal of shares in Sibanye Gold. Profit/(Loss) On Disposal Of Assets Profit on disposal of assets was U.S.$48 million in fiscal 2016 compared to U.S.$nil in fiscal 2015. Profit on disposal of assets of U.S.$48 million in fiscal 2016 related to the sale of royalties as part of the Maverix transaction. Royalties Royalties increased by 5% from U.S.$76 million in fiscal 2015 to U.S.$80 million in fiscal 2016 and are made up as follows: 2016 2015 (U.S.$ million) South Africa 2 1 Ghana 44 44 Peru 5 3 Australia 29 28 80 76 183 Table of Contents The royalty in South Africa and Australia increased in line with the increase in gold revenues. The royalty in Peru increased due to the higher operating margin of Cerro Corona. Mining And Income Tax Mining and income tax charge decreased by 22% from U.S.$247 million in fiscal 2015 to U.S.$192 million in fiscal 2016. The table below indicates Gold Fields’ effective tax rate in fiscal 2016 and 2015: 2016 2015 Income and mining tax charge—U.S.$ million (192 ) (247 ) Effective tax rate—% (52.5 ) (5,491.1 ) In fiscal 2016, the effective tax rate of 52.5% was higher than the maximum South African mining statutory tax rate of 34% mainly due to the tax effect of the following: • U.S.$23 million adjustment to reflect the actual realized company tax rates in South Africa and offshore; • U.S.$9 million deferred tax release on the reduction of corporate tax rate at the Ghanaian operations, partially offset by the increase in tax rate at Cerro Corona; • U.S.$6 million non-taxable profit on the buy-back of notes; and • U.S.$1 million non-taxable profit on disposal of investments. The above were offset by the following tax-effected charges: • U.S.$20 million non-deductible charges comprising share-based payments (U.S.$5 million) and exploration expense (U.S.$15 million); • U.S.$24 million non-deductible interest paid; • U.S.$1 million deferred tax charge on Peruvian Nuevo Sol devaluation against US Dollar; • U.S.$35 million deferred tax assets not recognized at Cerro Corona and Damang; • U.S.$10 million of net non-deductible expenditure and non-taxable income; • U.S.$1 million of non-deductible share of results of associates after taxation; and • U.S.$8 million of various Peruvian non-deductible expenses. In fiscal 2015, the effective tax rate of 5,491% was higher than the maximum South African mining statutory tax rate of 34% mainly due to the tax effect of the following: • U.S.$22 million adjustment to reflect the actual realized company tax rates in South Africa and offshore; and • U.S.$5 million deferred tax release on the change of tax rate at the Peruvian operation. The above were offset by the following tax-effected charges: • U.S.$12 million non-deductible charges comprising share-based payments (U.S.$4 million) and exploration expense (U.S.$8 million); • U.S.$53 million non-deductible impairment charges of assets relating mainly to listed investment, Hummingbird, APP and FSE; 184 Table of Contents • U.S.$27 million non-deductible interest paid; • U.S.$41 million deferred tax charge on Peruvian Nuevo Sol devaluation against US Dollar; • U.S.$113 million derecognition of deferred tax assets at Cerro Corona and Damang; • U.S.$9 million of net non-deductible expenditure and non-taxable income; • U.S.$2 million of non-deductible share of results of associates after taxation; and • U.S.$8 million of various Peruvian non-deductible expenses. Profit/(Loss) For The Year As a result of the factors discussed above, Gold Fields posted a profit of U.S.$174 million in fiscal 2016 compared with a loss of U.S.$243 million in fiscal 2015. Profit/(Loss) Attributable To Owners Of The Parent Gold Fields posted a profit attributable to owners of the parent of U.S.$163 million in fiscal 2016 compared to a loss of U.S.$242 million in fiscal 2015. Profit/(Loss) Attributable To Non-Controlling Interest Holders Profit/(loss) attributable to non-controlling interest was a profit of U.S.$11 million in fiscal 2016 compared to a loss of U.S.$1 million in fiscal 2015. The non-controlling interest consists of Gold Fields Ghana (Tarkwa) and Abosso Goldfields (Damang) at 10% each at the end of 2016 and 2015 and La Cima (Cerro Corona) at 0.47% at the end of 2016 and 2015. The amount making up the non-controlling interest is shown below: 2016 Non-controlling interest Effective (1) 2015 Non-controlling interest Effective (1) 2016 2015 (U.S.$ million) Gold Fields Ghana Limited—Tarkwa 10.0 % 10.0 % 12 9 Abosso Goldfields—Damang 10.0 % 10.0 % (1 ) (9 ) Gold Fields La Cima—Cerro Corona 0.47 % 0.47 % — (1 ) 11 (1 ) Note: (1) Average for the year. Earnings/(Loss) Per Share As a result of the above, Gold Fields earnings of U.S.$0.20 per share in fiscal 2016 compared with a loss of U.S.$0.31 per share in fiscal 2015. RESULTS FOR THE YEAR Years ended December 31, 2015 and December 31, 2014 (Loss)/profit attributable to owners of the parent was a loss of U.S.$242 million (or U.S.$0.31 per share) for fiscal 2015 compared to a profit of U.S.$13 million (or U.S.$0.02 per share) for fiscal 2014. The reasons for this decrease are discussed below. 185 Table of Contents Revenue Revenue decreased by 11% from U.S.$2,869 million in fiscal 2014 to U.S.$2,545 million in fiscal 2015. The decrease in revenue of U.S.$324 million was mainly due to a decrease of 9% in the average US dollar gold price for the year from U.S.$1,249 per ounce in fiscal 2014 to U.S.$1,140 per ounce in fiscal 2015, a 30% decrease in the average US dollar copper price from U.S.$6,827 per tonne in fiscal 2014 to U.S.$4,787 per tonne in fiscal 2015 and a decrease in gold sales of 3% from 2,296,200 equivalent ounces to 2,233,300 equivalent ounces in fiscal 2015. The rand weakened by 17% to the US dollar from an average of R10.82 in fiscal 2014 to R12.68 in fiscal 2015 and the average Australian/US dollar exchange rate weakened by 17% from an average of A$1=U.S.$0.90 in fiscal 2014 to A$1=U.S.$0.75 in fiscal 2015. Gold sales decreased by 3% from 2,296,200 equivalent ounces in fiscal 2014 to 2,233,300 equivalent ounces in fiscal 2015. Gold sales at the South African operation decreased by 1% from 6,237 kilograms (200,500 ounces) to 6,160 kilograms (198,000 ounces). Gold sales at the Ghanaian operations increased by 2% from 736,000 ounces to 753,900 ounces. Gold equivalent sales at the Peruvian operation decreased by 11% from 328,600 equivalent ounces to 293,300 equivalent ounces. At the Australian operations, gold sales decreased by 4% from 1,031,100 ounces to 988,000 ounces. As a general rule, Gold Fields sells all the gold it produces. 2015 2014 Revenue ‘000 Gold sold ‘000 Gold produced Revenue ‘000 Gold sold ‘000 Gold produced (U.S.$ million) (Ozs) (Ozs) (U.S.$ million) (Ozs) (Ozs) South Deep 232.3 198.0 198.0 254.8 200.5 200.5 Tarkwa 680.7 586.1 586.1 706.7 558.3 558.3 Damang 194.8 167.8 167.8 224.6 177.8 177.8 Cerro Corona 292.2 293.3 295.6 375.5 328.6 326.6 St. Ives 431.8 371.9 371.9 458.8 361.7 361.7 Agnew/Lawlers 273.9 236.6 236.6 342.5 270.7 270.7 Darlot 91.3 78.4 78.4 106.2 83.6 83.6 Granny Smith 348.4 301.1 301.1 399.8 315.2 315.2 Total 2,545.4 2,233.3 2,235.6 2,868.8 2,296.2 2,294.2 At South Deep in South Africa, gold sales were lower, decreasing by 1% from 6,237 kilograms (200,500 ounces) to 6,160 kilograms (198,000 ounces) mainly due to lower grades, partially offset by increased volumes. At the Ghanaian operations, gold sales at Tarkwa increased by 5% from 558,300 ounces to 586,100 ounces mainly due to higher grade. Damang’s gold sales decreased by 6% from 177,800 ounces to 167,800 ounces mainly due to lower grades, partially offset by increased volumes. At Cerro Corona in Peru, copper production decreased by 11% from 32,300 tonnes to 28,700 tonnes and gold production increased by 5% from 150,800 ounces to 158,800 ounces. As a result gold equivalent sales decreased by 11% from 328,600 ounces to 293,300 ounces due to a decrease in gold and copper grades as well as a lower gold equivalent price ratio. At the Australian operations, production at St. Ives increased by 3% from 361,700 ounces to 371,900 ounces mainly due to higher grades mined and processed. At Agnew/Lawlers, gold sales decreased by 13% from 270,700 ounces to 236,600 ounces mainly due to lower tonnes mined and processed as well as lower grade. Gold production at Darlot decreased by 6% from 83,600 ounces to 78,400 ounces mainly due to lower tonnes mined and processed, partially offset by higher grade. At Granny Smith gold production decreased by 4% from 315,200 ounces to 301,100 ounces mainly due to lower grades and volumes processed. 186 Table of Contents Cost of Sales Cost of sales, which comprise of operating costs, gold inventory change and amortization and depreciation, decreased by 11% from U.S.$2,334 million in fiscal 2014 to U.S.$2,066 million in fiscal 2015. Operating costs Operating costs decreased by 15% from U.S.$1,685 million in fiscal 2014 to U.S.$1,431 million in fiscal 2015. At South Deep in South Africa, operating costs increased by 13% from R2,657 million (U.S.$246 million) to R3,000 million (U.S.$237 million). This increase of R343 million was mainly due to annual wage increases and normal inflationary increases. At the Ghanaian operations, operating costs decreased by 6% from U.S.$551 million in fiscal 2014 to U.S.$519 million in fiscal 2015. This decrease of U.S.$32 million was mainly at Tarkwa due to ongoing business improvement initiatives and the lower oil price. It was partially offset by increased costs at Damang mainly due to the increased tonnes mined. At Tarkwa, operating costs decreased by 11% from U.S.$374 million to U.S.$334 million and at Damang, operating costs increased by 3% from U.S.$178 million to U.S.$184 million. At Cerro Corona in Peru, operating costs decreased by 9% from U.S.$158 million in fiscal 2014 to U.S.$144 million in fiscal 2015, mainly due to lower ore tonnes mined. At the Australian operations, operating costs decreased by 12% from A$808 million (U.S.$730 million) in fiscal 2014 to A$709 million (U.S.$533 million) in fiscal 2015 mainly due to lower production. At St. Ives, operating costs decreased by 20% from A$324 million (U.S.$292 million) to A$259 million (U.S.$195 million). This decrease of A$65 million was mainly due to restructuring after Cave Rocks mine moved into care and maintenance at the beginning of May 2015, reduced tonnage from Athena underground, lower costs at the Lefroy mill since the introduction of campaign milling in March 2015 as well as lower surface cartage costs resulting from shorter tramming distances after the Cave Rocks closure. At Agnew/Lawlers, operating costs decreased by 1% from A$192 million (U.S.$173 million) to A$190 million (U.S.$143 million) this was mainly due to cost saving initiatives. Operating costs at Darlot decreased by 12% from A$91 million (U.S.$82 million) to A$80 million (U.S.$60 million) due to lower mining and processing costs and continued rationalization of costs. At Granny Smith, operating costs decreased by 10% from A$202 million (U.S.$183 million) to A$181 million (U.S.$136 million) due to lower mining and processing costs. Gold inventory change The gold inventory charge to costs of U.S.$25 million in fiscal 2015 compared with a credit to costs of U.S.$7 million in fiscal 2014. At Tarkwa, the gold inventory credit of U.S.$2 million in fiscal 2014 compared with U.S.$7 million in fiscal 2015, both due to an increase in inventory. At Damang, the gold inventory charge of U.S.$2 million in fiscal 2015 was similar to 2014, both due to a drawdown of stockpiles. At Cerro Corona, the gold inventory charge of U.S.$2 million in fiscal 2014 compared with U.S.$1 million in fiscal 2015, both due to a drawdown of sulphide stockpiles. At St. Ives, the credit to costs of A$11 million (U.S.$10 million) in fiscal 2014 compared with a charge to costs of A$34 million (U.S.$25 million) in fiscal 2015. This was mainly due to a drawdown of Neptune stockpiles of A$34 million (U.S.$25 million) in fiscal 2015 compared with a build-up of A$11 million (U.S.$10 million) in fiscal 2014. 187 Table of Contents At Agnew/Lawlers, the gold inventory charge of A$nil (U.S.$nil) in fiscal 2014 compared with a credit to costs of A$2 million (U.S.$1 million) in fiscal 2015. The credit in fiscal 2015 was due to a build-up of inventory. At Darlot, the charge to costs of A$2 million (U.S.$2 million) in fiscal 2014 compared with a credit to costs of A$1 million (U.S.$1 million) in fiscal 2015 as a result of a build-up of inventory in fiscal 2015 compared with a drawdown in fiscal 2014. At Granny Smith, the charge of A$7 million (U.S.$5 million) in fiscal 2015 was due to a drawdown of inventory. This compared with a charge of A$nil (U.S.$nil) in fiscal 2014. Amortization and depreciation Depreciation and amortization is calculated on the units-of-production method and is based on current gold production as a percentage of total expected gold production over the lives of the different mines. 188 Table of Contents The table below depicts the changes from December 31, 2014 to December 31, 2015 for proven and probable managed gold and equivalent reserves and for the life-of-mine for each operation and the resulting impact on the amortization charge in fiscal 2015. The amortization in fiscal 2015 was based on the reserves as at December 31, 2014. The life-of-mine information is based on the operations’ strategic plans, adjusted for proven and probable reserve balances. In basic terms, amortization is calculated using the life-of-mine for each operation, which is based on: (1) the proven and probable reserves for the operation at the start of the relevant year (which are taken to be the same as at the end of the prior fiscal year); and (2) the amount of gold produced by the operation during the year. The ore reserve statement as at December 31, 2015 became effective on January 1, 2016. Proved and Probable Mineral Reserves as of Life of mine Amortization and depreciation for the year ended December 31, 2013 December 31, 2014 December 31, 2015 December 31, 2014 December 31, 2015 December 31, 2014 December 31, 2015 (‘000 oz) (years) (U.S.$ million) South African operation South Deep 38,200 38,000 37,300 73 81 74.5 67.9 Ghanaian operations Tarkwa(1) 7,300 7,500 6,700 17 16 141.6 162.3 Damang(2) 1,100 1,200 1,000 6 5 20.9 26.4 Peruvian operation Cerro Corona(3) 3,700 3,000 2,800 9 8 79.6 100.1 Australian operations St. Ives 2,000 1,800 1,500 6 5 140.5 109.9 Agnew/Lawlers 1,000 900 700 5 4 96.4 62.0 Darlot 200 100 30 2 0.5 16.6 25.8 Granny Smith 800 900 1,300 5 9 84.6 54.1 Corporate and other — — — — — 2.0 1.4 Total reserves(4) 54,300 53,400 51,330 656.7 609.9 Notes: (1) As of December 31, 2013, December 31, 2014 and December 31, 2015 mineral reserves of 6.546 million ounces, 6.742 million ounces and 6.071 million ounces of gold, respectively, were attributable to Gold Fields, with the remainder attributable to non-controlling shareholders in Tarkwa. (2) As of December 31, 2013, December 31, 2014 and December 31, 2015 mineral reserves of 0.966 million ounces, 1.111 million ounces and 0.876 million ounces of gold, respectively, were attributable to Gold Fields, with the remainder attributable to non-controlling shareholders in Damang. (3) As of December 31, 2013, December 31, 2014 and December 31, 2015 mineral reserves of 3.683 million ounces, 2.988 million ounces and 2.763 million ounces of equivalent gold were attributable to Gold Fields, with the remainder attributable to non-controlling shareholders in Cerro Corona. (4) As of December 31, 2013, December 31, 2014 and December 31, 2015 reserves of 49.363 million ounces, 48.123 million ounces and 47.292 million ounces of gold, respectively, were attributable to Gold Fields, with the remainder attributable to non-controlling shareholders in Tarkwa, Damang and Cerro Corona. Amortization and depreciation decreased by 7% from U.S.$657 million to U.S.$610 million in fiscal 2015. 189 Table of Contents At South Deep in South Africa, amortization and depreciation at South Deep increased by 7% from R806 million (U.S.$75 million) in fiscal 2014 to R861 million (U.S.$68 million) in fiscal 2015 mainly due to additions to property, plant and equipment and reassessment of useful lives of certain assets. At the Ghanaian operations, amortization and depreciation increased by 16% from U.S.$163 million in fiscal 2014 to U.S.$189 million in fiscal 2015. Tarkwa increased by 14% from U.S.$142 million to U.S.$162 million due to additions to property, plant and equipment. Damang increased by 24% from U.S.$21 million to U.S.$26 million mainly due to an increase in volume mined. At Cerro Corona in Peru, amortization and depreciation at Cerro Corona increased by 25%, from U.S.$80 million in fiscal 2014 to U.S.$100 million in fiscal 2015. This significant increase from 2014 to 2015 was due additions to property, plant and equipment and reassessment of useful lives of certain assets. At the Australian operations, amortization and depreciation decreased by 10%, from A$374 million (U.S.$338 million) in fiscal 2014 to A$335 million (U.S.$252 million) in fiscal 2015 mainly due to lower production. At St. Ives, amortization and depreciation decreased by 6% from A$156 million (U.S.$141 million) in fiscal 2014 to A$146 million (U.S.$110 million) due to the decrease in production. Agnew/Lawlers decreased by 23% from A$107 million (U.S.$96 million) in fiscal 2014 to A$82 million (U.S.$62 million) mainly due to lower production. Amortization and depreciation at Darlot increased by 89% from A$18 million (U.S.$17 million) to A$34 million (U.S.$26 million) as a result of the change in life of mine reserves. At Granny Smith, amortization and depreciation decreased by 23% from A$94 million (U.S.$85 million) to A$72 million (U.S.$54 million) due to lower production. All-in sustaining and total all-in cost The following table sets out for each operation and the Group, total gold sales in ounces, AISC and total AIC, net of by-product revenue, in U.S.$/oz for fiscal 2015 and fiscal 2014: 2015 2014 Gold only ounces sold All-in sustaining costs(2) Total-all in cost(2) Gold only ounces sold All-in sustaining costs(2) Total-all in cost(2) (Ozs) (U.S.$/oz) (U.S.$/oz) (Ozs) (U.S.$/oz) (U.S.$/oz) South Deep 198.0 1,490 1,559 200.5 1,548 1,732 South African operation 198.0 1,490 1,559 200.5 1,548 1,732 Tarkwa 586.1 970 970 558.3 1,068 1,068 Damang 167.8 1,326 1,326 177.8 1,175 1,175 Ghanaian operations 753.9 1,049 1,049 736.0 1,094 1,094 Cerro Corona(1) 158.8 718 718 153.6 316 316 Peruvian operation 158.8 718 718 153.6 316 316 St. Ives 371.9 969 969 361.7 1,164 1,164 Agnew/Lawlers 236.6 959 959 270.7 990 990 Darlot 78.4 1,057 1,057 83.6 1,222 1,222 Granny Smith 301.1 764 764 315.2 809 809 Australian operations 988.0 912 912 1,031.1 1,015 1,015 GIP and Corporate — 6 19 — 11 28 Total operations 2,098.8 1,007 1,026 2,121.4 1,053 1,087 Notes: (1) Gold sold at Cerro Corona excludes copper equivalents of 134,500 ounces in fiscal 2015 and 175,000 ounces in fiscal 2014. (2) Net of by-product revenue. (3) AIC are calculated in accordance with the WGC Industry standard. Refer to page 162 for detailed calculations and discussion of non-IFRS measures. (4) Figures may not add as they are rounded independently. 190 Table of Contents AISC decreased by 4% from U.S.$1,053 per ounce in fiscal 2014 to U.S.$1,007 per ounce in fiscal 2015. Total AIC decreased by 6% from U.S.$1,087 per ounce in fiscal 2014 to U.S.$1,026 per ounce in fiscal 2015. The decrease in AISC and total AIC was due to lower net operating costs, the weaker R/US dollar and A$/U.S.$ dollar, partially offset by lower by-product credits and higher capital expenditure. At South Deep in South Africa, AISC of R607,429 per kilogram (U.S.$1,490 per ounce) and total AIC of R635,622 per kilogram (U.S.$1,559 per ounce) in fiscal 2015 compared with AISC of R538,254 per kilogram (U.S.$1,548 per ounce) and total AIC of R602,363 per kilogram (U.S.$1,732 per ounce) in fiscal 2014 due to lower gold sold and higher operating costs, partially offset by lower capital expenditure. At the Ghanaian operations, AISC and total AIC for the region of U.S.$1,049 per ounce in fiscal 2015 compared with U.S.$1,094 per ounce in fiscal 2014. At Tarkwa, AISC and total AIC of U.S.$970 per ounce in fiscal 2015 compared with U.S.$1,068 per ounce in fiscal 2014 due to increased gold sold and lower operating costs, partially offset by higher capital expenditure. At Damang, AISC and total AIC of U.S.$1,326 per ounce in fiscal 2015 compared with U.S.$1,175 per ounce in fiscal 2014 due to higher net operating costs, lower gold sold and the U.S.$8 million inventory write-off. At Cerro Corona in Peru, AISC and total AIC amounted to U.S.$718 per ounce in fiscal 2015 compared with U.S.$316 per ounce in fiscal 2014 due to lower gold sold, lower by-product credits and higher capital expenditure, partially offset by lower net operating costs. AISC and total AIC, on a gold equivalent basis amounted to U.S.$777 per ounce in fiscal 2015 compared with U.S.$702 per ounce in fiscal 2014 mainly due to the same reasons as above as well as lower equivalent ounces sold. At the Australian operations, AISC and total AIC for the region of A$1,211 per ounce (U.S.$912 per ounce) in fiscal 2015 compared with A$1,124 per ounce (U.S.$1,015 per ounce) in fiscal 2014 due to lower gold sold and higher capital expenditure, partially offset by lower net operating costs. At St. Ives, AISC and total AIC for St. Ives of A$1,287 per ounce (U.S.$969 per ounce) in fiscal 2015 compared with A$1,289 per ounce (U.S.$1,164 per ounce) in fiscal 2014 due to higher gold sold and lower net operating costs, partially offset by higher capital expenditure. At Agnew/Lawlers, AISC and total AIC for Agnew/Lawlers of A$1,276 per ounce (U.S.$959 per ounce) in fiscal 2015 compared with A$1,096 per ounce (U.S.$990 per ounce) in fiscal 2014 due to lower gold sold and higher capital expenditure, partially offset by lower net operating costs. At Darlot, AISC and total AIC of A$1,403 per ounce (U.S.$1,057 per ounce) in fiscal 2015 compared with A$1,353 per ounce (U.S.$1,222 per ounce) in fiscal 2014 due to lower gold sold and higher capital expenditure, partially offset by lower operating costs. At Granny Smith, AISC and total AIC of A$1,017 per ounce (U.S.$764 per ounce) in fiscal 2015 compared with A$896 per ounce (U.S.$809 per ounce) in fiscal 2014 due to lower gold sold and higher capital expenditure, partially offset by lower net operating costs. Net Operating Profit Net operating profit decreased by 10% from U.S.$534 million in fiscal 2014 to U.S.$479 million in fiscal 2015 due to reasons discussed earlier. Investment Income Income from investments increased by 50% from U.S.$4 million in fiscal 2014 to U.S.$6 million in fiscal 2015. The increase was mainly due to higher cash balances at the international operations in fiscal 2015. The investment income in fiscal 2015 of U.S.$6 million comprised U.S.$nil interest on monies invested in the South African rehabilitation trust fund and U.S.$6 million interest on other cash and cash equivalent balances. The investment income in fiscal 2014 of U.S.$4 million comprised U.S.$1 million interest on monies invested in the South African and Ghanaian environmental rehabilitation trust funds and U.S.$3 million interest on other cash and cash equivalent balances. 191 Table of Contents Interest received on the funds decreased from U.S.$1 million in fiscal 2014 to U.S.$nil in fiscal 2015 mainly due to the weakening of the South Rand resulting in South Deep’s rand contribution being a nil United States Dollar figure. Interest on other cash balances increased from U.S.$3 million in fiscal 2014 to U.S.$6 million in fiscal 2015 mainly due to higher cash balances at the international operations in fiscal 2015. Finance Expense Finance expense decreased by 16% from U.S.$99 million in fiscal 2014 to U.S.$83 million in fiscal 2015. The finance expense of U.S.$83 million in fiscal 2015 comprised U.S.$12 million relating to the accretion of the environmental rehabilitation liability and U.S.$88 million on various Group borrowings, partially offset by interest capitalized of U.S.$17 million. The finance expense of U.S.$99 million in fiscal 2014 comprised U.S.$18 million relating to the accretion of the environmental rehabilitation liability and U.S.$105 million on various Group borrowings, partially offset by interest capitalized of U.S.$24 million. The environmental rehabilitation liability accretion expense decreased from U.S.$18 million in fiscal 2014 to U.S.$12 million in fiscal 2015 mainly due to lower present values of the rehabilitation liabilities which resulted from an increase in discount rates. Below is an analysis of the components making up the interest on the various Group borrowings, stated on a comparative basis: 2015 2014 (U.S.$ million) Interest on borrowings to fund capital expenditure and operating costs at the South African operation 3 18 Interest on U.S.$1 billion notes issue 50 50 Sibanye Gold guarantee fee 1 5 Interest on U.S.$70 million senior secured revolving credit facility 2 3 Interest on U.S.$200 million non-revolving senior secured term loan — 2 Interest on U.S.$150 million revolving senior secured credit facility 3 — Interest of U.S.$1,510 million term loan and revolving credit facility 28 25 Other interest charges 1 2 88 105 Interest on borrowings to fund capital expenditure and operating costs at the South African operation decreased from U.S.$18 million in fiscal 2014 to U.S.$3 million in fiscal 2015 due to repayments of South African borrowings in the March 2015 quarter. Interest on the U.S.$1 billion notes issue remained flat at U.S.$50 million in fiscal 2015. The yearly guarantee fee of U.S.$5 million became payable to Sibanye Gold in fiscal 2013 after the unbundling of Sibanye Gold. On April 24, 2015, Sibanye Gold was released as guarantor, resulting in a pro-rata guarantee fee of U.S.$1 million in fiscal 2015. Interest on the U.S.$70 million senior secured revolving credit facility decreased marginally from U.S.$3 million in fiscal 2014 to U.S.$2 million in fiscal 2015. 192 Table of Contents On December 19, 2014, the outstanding balance under the U.S.$200 million non-revolving senior secured term loan was refinanced by drawing down under the U.S.$150 million revolving senior secured credit facility. Interest on these facilities increased marginally from U.S.$2 million in fiscal 2014 to U.S.$3 million in fiscal 2015. Interest on the U.S.$1,510 million term loan and revolving credit facilities increased from U.S.$25 million in fiscal 2014 to U.S.$28 million in fiscal 2015. The increase is due to additional borrowings during 2015. During 2015, U.S.$17 million (2014: U.S.$24 million) of interest was capitalized in terms of IAS 23, Borrowing Cost. IAS 23 requires capitalization of borrowing costs whenever general borrowings are used to finance qualifying projects. The only qualifying project was South Deep’s mine development. An average interest capitalization rate of 4.8% (2014: 5.3%) was applied. Loss on Financial Instruments The loss on financial instruments decreased by 58% from U.S.$12 million in fiscal 2014 to U.S.$5 million in fiscal 2015. The loss on financial instruments of U.S.$5 million in fiscal 2015 and U.S.$12 million in fiscal 2014 comprised the loss on the Australian diesel hedges. On September 10, 2014, Gold Fields Australia (Proprietary) Limited entered into a Singapore Gasoil 10ppm cash settled swap transaction contract for a total of 136,500 barrels, effective September 15, 2014 until March 31, 2015 at a fixed price of U.S.$115.00 per barrel. The 136,500 barrels are based on 50 per cent of usage for the seven month period September 2014 to March 2015. Brent Crude at the time of the transaction was U.S.$99.10 per barrel. On November 26, 2014, Gold Fields Australia (Pty) Limited entered into further contracts. A contract for 63,000 barrels for the period from January to March 2015 was committed at a fixed price of U.S.$94.00 per barrel and a further 283,500 barrels was committed at a price of U.S.$96.00 per barrel for the period April to December 2015. Brent Crude at the time of the transaction was U.S.$78.50 per barrel. By entering into the above contracts, the Australian region hedged its full diesel requirements for fiscal 2015. As at December 31, 2015, the fair value of these oil derivative contracts was negative U.S.$2 million (2014: negative U.S.$10 million). Foreign Exchange Gains The foreign exchange gains increased by 25% from U.S.$8 million in fiscal 2014 to U.S.$10 million in fiscal 2015. The foreign exchange gains comprised exchange gains on cash and working capital balances. The exchange gains of U.S.$10 million in fiscal 2015 were mainly due to the weakening of the Australian Dollar, while the U.S.$8 million in fiscal 2014 were due to the weakening of the Ghanaian Cedi. Other Costs, Net Other costs decreased by 67% from U.S.$63 million in fiscal 2014 to U.S.$21 million in fiscal 2015. The costs in fiscal 2015 are mainly made up of: • Social contributions and sponsorships of U.S.$12 million; • Global compliance costs of U.S.$4 million; • Facility charges of U.S.$2 million on the South African Rand borrowings; and 193 Table of Contents • Rehabilitation income of U.S.$15 million as a result of changes in estimates relating to the provision for environmental rehabilitation costs recognized in profit or loss. The costs in fiscal 2014 are mainly made up of: • Social contributions and sponsorships of U.S.$12 million; • Facility charges of U.S.$1 million on the South African Rand borrowings; • Legal fees amounting to U.S.$7 million as a result of the Gold Fields Board examination and regulatory investigation relating to the South Deep Black Economic Empowerment transaction; • Rehabilitation costs of U.S.$18 million as a result of changes in estimates relating to the provision for environmental rehabilitation costs recognized in profit or loss; and • Information technology conversion costs at the Yilgarn South Assets of U.S.$5 million. Share-Based Payments Gold Fields recognizes the cost of share options granted (share-based payments) in terms of IFRS 2, Share-based payment. Share-based payments decreased by 58% from U.S.$26 million in fiscal 2014 to U.S.$11 million in fiscal 2015. The corresponding entry for the above adjustments was share-based payment reserve within shareholders’ equity. The decrease in share-based payments was due to the fact that no allocations of options under existing plans were made during 2014 and 2015 following the introduction of the Long Term Incentive Plan during 2014. Long-Term Incentive Plan Expense Gold Fields recognizes the long-term incentive plan expense in terms of IAS 19, Employee benefits. On March 1, 2014, the Remuneration Committee approved the LTIP. The plan provides for executive directors, certain officers and employees to receive a cash award conditional on the achievement of specified performance conditions relating to total shareholder return and FCF Margin. The conditions are assessed over the performance cycle which runs over three calendar years. The expected timing of the cash outflows in respect of each grant is at the end of three years after the original award was made. These awards are measured on the date the award is made and re-measured at each reporting period. The total shareholder return portion of the award is measured using the Monte Carlo simulation valuation model, which requires assumptions regarding the share price volatility and expected dividend yield. The fair value of the free cash flow portion of the award is valued based on the actual and expected achievement of the cash flow targets set out in the plan. The assumptions used in the Monte Carlo model and the expected cash flow targets are reviewed at each reporting date. The LTIP expense decreased by 44% from U.S.$9 million in fiscal 2014 to U.S.$5 million in fiscal 2015. The decrease was due to marked-to-market adjustments, partially offset by two years of grants being valued in fiscal 2015 compared to one year of grants in fiscal 2014. Exploration Expense For fiscal 2015, U.S.$95 million was spent on exploration, comprising brownfields exploration of U.S.$72 million (Australia U.S.$68 million, Ghana U.S.$3 million and South Africa U.S.$1 million) and greenfields exploration comprising Salares Norte in Chile (U.S.$16 million), APP in Finland (U.S.$1 million) and U.S.$6 million was spent on exploration office costs. Of the U.S.$95 million exploration costs incurred, U.S.$54 million was recognized in the consolidated income statement of which U.S.$31 million related to Australia. 194 Table of Contents For fiscal 2014, U.S.$98 million was spent on exploration, comprising brownfields exploration of U.S.$62 million (Australia U.S.$58 million and Ghana U.S.$4 million) and greenfields exploration comprising Yanfolila in Mali (U.S.$4 million) up to the date of disposal, Salares Norte in Chile (U.S.$11 million), APP in Finland (U.S.$3 million) and Chucapaca in Peru (U.S.$3 million) and U.S.$15 million was spent on exploration office costs. Of the U.S.$98 million exploration costs incurred, U.S.$47 million was recognized in the consolidated income statement of which U.S.$15 million related to Australia. Subject to continued exploration success, U.S.$118 million will be spent on exploration, comprising brownfields exploration of U.S.$63 million (Australia U.S.$63 million) and greenfields exploration of U.S.$55 million. Share of Results of Equity Accounted Investees After Taxation Share of results of equity accounted investees after taxation increased by 200% from a loss of U.S.$2 million in fiscal 2014 to a loss of U.S.$6 million in fiscal 2015. The increase relates mainly to ongoing study and evaluation costs at the FSE project in the Philippines and the Group’s share of losses of U.S.$2 million at Hummingbird (up to June 30, 2015, the date Hummingbird was reclassified to available-for-sale financial investments). Restructuring Costs Restructuring costs decreased by 79% from U.S.$42 million in fiscal 2014 to U.S.$9 million in fiscal 2015. The cost in fiscal 2015 relates mainly to separation packages in Tarkwa and St. Ives and the cost in fiscal 2014 related mainly to separation packages in Tarkwa, South Deep, Damang and St. Ives. Impairment of Investments and Assets Impairment of investments and assets increased from U.S.$27 million in fiscal 2014 to U.S.$221 million in fiscal 2015. The impairment charge of U.S.$221 million in fiscal 2015 comprises: • U.S.$8 million net realizable write-downs of stockpiles at Damang; • U.S.$7 million impairment of redundant assets at Cerro Corona; • U.S.$14 million cash-generating unit impairment at Darlot; • U.S.$36 million asset specific impairment at Damang, relating to immovable assets that would no longer be used under the current life of mine; • U.S.$39 million at the APP. This project is valued at the lower of fair value less cost of disposal or carrying value after a decision was made to dispose of APP and it was reclassified as held for sale in fiscal 2013. The carrying value at December 31, 2014 was U.S.$40 million based on an offer made as part of the ongoing sale process during 2014. This offer was not realized and during 2015, APP was further impaired by U.S.$39 million to its fair value less cost of disposal; • U.S.$101 million impairment of the Group’s investment in FSE to its recoverable amount; • U.S.$8 million impairment of Hummingbird was recognized to adjust the carrying value of the investment to its fair value upon derecognition of the investment as an equity accounted investee; and • U.S.$8 million related to impairment of listed investments (Hummingbird, Bezant and various junior exploration companies) to their fair values. The impairment charge of U.S.$27 million in fiscal 2014 comprises: • U.S.$1 million net realizable write-downs of consumables at Lawlers; 195 Table of Contents • U.S.$13 million impairment of redundant assets at South Deep, St. Ives and Agnew/Lawlers; • U.S.$3 million at the APP. This project is valued at the lower of fair value less cost of disposal or carrying value after a decision was made to dispose of APP and it was reclassified as held for sale in fiscal 2013. The carrying value at December 31, 2013 was U.S.$43.2 million based on an offer made as part of the ongoing sale process during 2013. This offer was not realized but a second, lower offer was received closer to the end of 2014 which resulted in the further impairment in fiscal 2014; • U.S.$8 million related to impairment of listed investments (Bezant, Orsu Metals Corporation and various junior exploration companies); and • U.S.$6 million related to impairment of unlisted investments (Rand Refinery and Aurigin Resources Incorporated). The above impairments were partially offset by the reversal of U.S.$4 million impairment of Yanfolila. Following the Group’s decision during 2013 to dispose of non-core projects, Yanfolila was classified as held for sale and, accordingly, valued at the lower of fair value less cost to sell or carrying value which resulted in an impairment of U.S.$30 million during 2013. During 2014, Gold Fields sold its 85% interest in the Yanfolila project in Mali to London-listed Hummingbird for U.S.$21 million, which was settled in the form of 21,258,503 Hummingbird shares. The fair value of Hummingbird shares exceeded the carrying value of Yanfolila, which resulted in a partial reversal of the 2013 impairment in fiscal 2014. Profit on Disposal of Investments The profit on the disposal of investments was U.S.$nil in fiscal 2015 compared to U.S.$1 million in fiscal 2014. The profit on disposal of investments of U.S.$1 million in fiscal 2014 comprises: U.S.$ million Profit on disposal of shares in Robust Resources Limited 2 Additional loss on disposal of the Group’s interest in Talas (exploration project in Kyrgyzstan) (1 ) 1 Profit on Disposal of Chucapaca During 2014, Gold Fields sold its 51% interest in Canteras del Hallazgo (entity that houses the Chucupaca project in Peru) for U.S.$81 million to Compañía de Minas Buenaventura S.A.A. realizing a profit of U.S.$5 million. Loss on Disposal of Assets Loss on disposal of assets was U.S.$nil in fiscal 2015 compared to U.S.$1 million in fiscal 2014. The major disposals in fiscal 2014 related to the sale of redundant assets at St. Ives, Darlot, Granny Smith, Tarkwa, Cerro Corona and South Deep. Royalties Royalties decreased by 12% from U.S.$86 million in fiscal 2014 to U.S.$76 million in fiscal 2015 and are made up as follows: 2015 2014 (U.S.$ million) South Africa 1 1 Ghana 44 47 Peru 3 6 Australia 28 32 76 86 196 Table of Contents The royalty in Ghana decreased in line with the decrease in gold revenue. The royalty in Peru reduced due to the lower operating margin of Cerro Corona. The royalty in Australia remained stable in Australian Dollar terms from 2014 to 2015, however, decreased in United States Dollar terms due to the weakening of the Australian Dollar against the United States Dollar in fiscal 2015. Mining and Income Tax Mining and income tax was a charge of U.S.$247 million in fiscal 2015 compared to U.S.$118 million in fiscal 2014. The table below indicates Gold Fields’ effective tax rate in fiscal 2015 and 2014: 2015 2014 Income and mining tax charge—U.S.$ million (247 ) (118 ) Effective tax rate—% (5,491.1 ) (85.3 ) In fiscal 2015, the effective tax rate of 5,491% was higher than the maximum South African mining statutory tax rate of 34% mainly due to the tax effect of the following: • U.S.$22 million adjustment to reflect the actual realized company tax rates in South Africa and offshore; and • U.S.$5 million deferred tax release on the change of tax rate at the Peruvian operations. The above were offset by the following tax-effected charges: • U.S.$12 million non-deductible charges comprising share-based payments (U.S.$4 million) and exploration expense (U.S.$8 million); • U.S.$53 million non-deductible impairment charges of assets relating mainly to listed investment, Hummingbird, APP and FSE; • U.S.$27 million non-deductible interest paid; • U.S.$41 million deferred tax charge on Peruvian Nuevo Sol devaluation against United States Dollar; • U.S.$113 million derecognition of deferred tax assets at Cerro Corona and Damang; • U.S.$9 million of net non-deductible expenditure and non-taxable income; • U.S.$2 million of non-deductible share of results of associates after taxation; and • U.S.$8 million of various Peruvian non-deductible expenses. In fiscal 2014, the effective tax rate of 85% was higher than the maximum South African mining statutory tax rate of 34% mainly due to the tax effect of the following: • U.S.$8 million adjustment to reflect the actual realized company tax rates in South Africa and offshore; and • U.S.$2 million non-taxable profit on disposal of investments and subsidiaries. The above were offset by the following tax-effected charges: • U.S.$18 million non-deductible charges comprising share-based payments (U.S.$7 million) and exploration expense (U.S.$11 million); • U.S.$4 million non-deductible impairment charges of assets relating mainly to APP, Yanfolila, Bezant and Rand Refinery; 197 Table of Contents • U.S.$28 million non-deductible interest paid; • U.S.$2 million non-deductible legal and consulting fees; • U.S.$3 million deferred tax charge on Peruvian Nuevo Sol devaluation against United States Dollar; • U.S.$8 million of net non-deductible expenditure and non-taxable income; • U.S.$1 million of non-deductible share of results of associates after taxation; and • U.S.$8 million of various Peruvian non-deductible expenses. (Loss)/Profit For The Year As a result of the factors discussed above, Gold Fields posted a loss of U.S.$243 in fiscal 2015 compared with a profit of U.S.$20 million in fiscal 2014. (Loss)/Profit Attributable To Owners Of The Parent From Continuing Operations Gold Fields posted a loss attributable to ordinary shareholders of the company of U.S.$242 million in fiscal 2015 compared to a profit of U.S.$13 million in fiscal 2014. (Loss)/Profit Attributable To Non-Controlling Interest Holders (Loss)/profit attributable to non-controlling interest was a loss of U.S.$1 million in fiscal 2015 compared to a profit of U.S.$8 million in fiscal 2014. The non-controlling interest consists of Gold Fields Ghana (Tarkwa) and Abosso Goldfields (Damang) at 10% each at the end of 2015 and 2014, Gold Fields La Cima (Cerro Corona) at 0.47% at the end of 2015 and 2014 and Canteras del Hallazgo (entity that houses the Chucupaca project in Peru) at nil% at the end of 2015 and 2014. Gold Fields sold its interest in Canteras del Hallazgo for U.S.$81 million during 2014. The amount making up the non-controlling interest is shown below: 2015 Non-controlling interest Effective (1) 2014 Non-controlling interest Effective (1) 2015 2014 (%) (U.S.$ million) Gold Fields Ghana Limited—Tarkwa 10.0 10.0 9 9 Abosso Goldfields—Damang 10.0 10.0 (9 ) — Gold Fields La Cima—Cerro Corona 0.47 0.47 (1 ) — Canteras del Hallazgo — 49.0 — (1 ) (1 ) 8 Note: (1) Average for the year. (Loss)/Earnings Per Share As a result of the above, Gold Fields realized a loss of U.S.$0.31 per share in fiscal 2015 compared with earnings of U.S.$0.02 per share in fiscal 2014. 198 Table of Contents Liquidity and Capital Resources Years ended December 31, 2016 and December 31, 2015 Cash resources Cash Flows From Operating Activities Cash inflows from operating activities increased by 23% from U.S.$744 million in fiscal 2015 to U.S.$918 million in fiscal 2016. The increase of U.S.$174 million was due to: U.S.$ million Increase in cash generated from operations due to higher operating profit 265 Increase in interest received due to higher cash balances 1 Increase in investment in working capital (46 ) Decrease in interest paid due to lower borrowings 5 Increase in royalties paid due to higher revenue (2 ) Increase in taxes paid (37 ) Increase in dividends paid due to higher normalized earnings (12 ) 174 Dividends paid increased from U.S.$29 million in fiscal 2015 to U.S.$41 million in fiscal 2016. The dividends paid of U.S.$41 million in fiscal 2016 comprised dividends paid to ordinary shareholders of U.S.$39 million, non-controlling interests in Peru of U.S.$1 million and South Deep BEE dividend of U.S.$1 million. The dividends paid of U.S.$29 million in fiscal 2015 comprised dividends paid to ordinary shareholders of U.S.$15 million, non-controlling interests in Ghana and Peru of U.S.$12 million and South Deep BEE dividend of U.S.$2 million. Cash Flows From Investing Activities Cash outflows from investing activities increased by 33% from U.S.$652 million in fiscal 2015 to U.S.$868 million in fiscal 2016. The items comprising these numbers are discussed below. Additions to property, plant and equipment Capital expenditure increased by 3% from U.S.$634 million in fiscal 2015 to U.S.$650 million in fiscal 2016. Capital expenditure at South Deep in South Africa increased by 35% from R848 million (U.S.$67 million) in fiscal 2015 to R1,145 million (U.S.$78 million) in fiscal 2016: • This increase was due to higher spending on fleet, the refurbishment of the man winder at Twin shaft and higher spend on mining employee accommodation. Capital expenditure at the Ghanaian operations decreased by 7% from U.S.$221 million in fiscal 2015 to U.S.$206 million in fiscal 2016: • Tarkwa decreased by 18% from U.S.$204 million to U.S.$168 million mainly due to the purchase of mining fleet for replacement in fiscal 2015; and • Damang increased by 124% from U.S.$17 million to U.S.$38 million with the majority spent on waste stripping at the Amoanda pit. 199 Table of Contents Capital expenditure at Cerro Corona in Peru decreased by 34% from U.S.$65 million in fiscal 2015 to U.S.$43 million in fiscal 2016: • The decrease is due to higher expenditure on construction of the tailings dam, waste storage facilities and once-off capital projects in fiscal 2015. Capital expenditure at the Australian operations increased by 16% from A$373 million (U.S.$281 million) in fiscal 2015 to A$431 million (U.S.$322 million) in fiscal 2016: • St. Ives increased by 24% from A$152 million (U.S.$115 million) to A$188 million (U.S.$140 million) due to increased expenditure on pre-stripping at the Invincible and Neptune open pits; • Agnew/Lawlers decreased by 3% from A$97 million (U.S.$73 million) to A$94 million (U.S.$70 million) due to increased development of Fitzroy Bengal Hastings at Waroonga in fiscal 2015, partially offset by increased exploration expenditure in fiscal 2016. • Darlot increased by 7% from A$27 million (U.S.$20 million) to A$29 million (U.S.$21 million) due to increased exploration and capital development at the Oval ore body. • Granny Smith increased by 26% from A$96 million (U.S.$72 million) to A$121 million (U.S.$90 million). The majority of expenditure related to capital development, exploration and the establishment of new fresh air intake ventilation raises. Proceeds on disposal of property, plant and equipment Proceeds on the disposal of property, plant and equipment decreased by 33% from U.S.$3 million in fiscal 2015 to U.S.$2 million in fiscal 2016. In both 2016 and 2015, this related to the sale of various redundant assets. Purchase of Gruyere Gold Project assets On December 13, 2016, Gold Fields purchased 50% of the Gruyere Gold Project and entered into a 50:50 unincorporated joint venture with Gold Road for the development and operation of the Gruyere Gold Project in Western Australia, which comprises the Gruyere gold deposit as well as additional resources including Central Bore and Attila/Alaric. Gold Fields acquired 50% interest in the Gruyere Gold Project for a total purchase consideration of A$350.0 million payable in cash and a 1.5% royalty on Gold Fields’ share of production after total mine production exceeds 2 million ounces. The cash consideration is split with A$250.0 million payable on effective date and A$100.0 million payable according to an agreed construction cash call schedule. Transaction costs of A$19 million were incurred. At December 31, 2016, Gruyere mining assets of U.S.$276 million (A$372 million) were capitalized of which U.S.$197 million (A$266 million) were cash additions and U.S.$79 million (A$106 million) were non-cash additions. The U.S.$197 million (A$266 million) cash additions comprise the initial cash consideration of A$250 million payable, as well as additional development costs. The U.S.$79 million (A$106 million) non-cash additions comprise of the initial A$100 million payable, as well as stamp duties payable. Purchase of investments Investment purchases increased by 333% from U.S.$3 million in fiscal 2015 to U.S.$13 million in fiscal 2016. The purchase of investments of U.S.$13 million in fiscal 2016 comprised: U.S.$ million Cardinal Resource Limited 13 13 200 Table of Contents The purchase of investments of U.S.$3 million in fiscal 2015 comprised: U.S.$ million Mine Vision Systems 3 3 Proceeds on disposal of investments Proceeds on the disposal of investments increased from U.S.$nil in fiscal 2015 to U.S.$4 million in fiscal 2016. The proceeds on disposal of investments of U.S.$4 million in fiscal 2016 comprised: U.S.$ million Sale of shares in Sibanye Gold Limited 2 Sale of shares in Tocqueville Bullion Reserve Limited 2 4 Environmental trust funds and rehabilitation payments The environmental trust fund and rehabilitation payments decreased by 17% from U.S.$18 million in fiscal 2015 to U.S.$15 million in fiscal 2016. During 2016, Gold Fields paid U.S.$2 million into its South Deep mine environmental trust fund and U.S.$6 million into its Tarkwa mine environmental trust fund and spent U.S.$7 million on on-going rehabilitation at the international operations, resulting in a total cash outflow of U.S.$15 million for the year. During 2015, Gold Fields paid U.S.$1 million into its South Deep mine environmental trust fund and U.S.$7 million into its Tarkwa mine environmental trust fund and spent U.S.$10 million on on-going rehabilitation at the international operations, resulting in a total cash outflow of U.S.$18 million for the year. Cash Flows From Financing Activities Cash outflows from financing activities was an inflow of U.S.$37 million in fiscal 2016 compared to an outflow of U.S.$88 million in fiscal 2015. Share issue During 2016, Gold Fields completed a U.S.$152 million (R2.3 billion) non-U.S. accelerated equity raising by way of a private placement to institutional investors. A total number of 38,857,913 new Gold Fields shares were placed at a price of R59.50 per share which represented a 6% discount to the 30-day volume weighted average traded price, for the period March 17, 2016 and a 0.7% discount to the 50-day moving average. The net proceeds from the placement were used to finance the buy-back of the notes. 201 Table of Contents Loans raised Loans raised increased by 157% from U.S.$506 million in fiscal 2015 to U.S.$1,299 million in fiscal 2016. The U.S.$1,299 million loans raised in fiscal 2016 comprised: U.S.$ million U.S.$150 million revolving senior secured credit facility 40 U.S.$1,510 million term loan and revolving credit facilities 174 U.S.$1,290 million term loan and revolving credit facilities(1) 708 R1,500 million Nedbank revolving credit facility 21 Short-term Rand uncommitted credit facilities 356 1,299 Note: Credit facilities refinancing (1) Gold Fields successfully refinanced its U.S.$1,510 million credit facilities due in November fiscal 2017. The new facilities amount to U.S.$1,290 million and comprise three tranches: • U.S.$380 million: three-year term loan maturing in June fiscal 2019 – margin 250 basis points (bps) over LIBOR; • U.S.$360 million: three-year revolving credit facility also maturing in June fiscal 2019 (with an option to extend to up to five years) – margin 220bps over LIBOR; and • U.S.$550 million: five-year revolving credit facility maturing in June fiscal 2021 – margin 245bps over LIBOR. The new facilities were concluded with a syndicate of 15 banks. On average, the interest rate on the new facilities is similar to the interest rate on the existing facilities. A total of U.S.$645 million was drawn down from the new facilities on 13 June 2016 to repay the Group’s existing U.S.$ facilities, with U.S.$645 million remaining unutilized. The refinancing is a key milestone in Gold Fields’ balance sheet management and increases the maturity of its core debt, with the first maturity now only in June fiscal 2019 (previously November fiscal 2017). The U.S.$506 million loans raised in fiscal 2015 comprised: U.S.$ million U.S.$70 million senior secured revolving credit facility 10 U.S.$1,510 million term loan and revolving credit facilities 400 Short-term Rand uncommitted credit facilities 96 506 202 Table of Contents Loans repaid Loans repaid increased by 138% from U.S.$594 million in fiscal 2015 to U.S.$1,413 million in fiscal 2016. The U.S.$1,413 million loans repaid in fiscal 2016 comprised: U.S.$ million U.S.$1 billion notes issue(1) 130 U.S.$1,510 million term loan and revolving credit facility 898 U.S.$1,290 million term loan and revolving credit facility 49 R1,500 million Nedbank revolving credit facility 21 Short-term Rand uncommitted credit facilities 315 1,413 Note: Bond buy-back (1) On February 19, 2016, Gold Fields announced an offer to purchase U.S.$200 million of the U.S.$1 billion notes outstanding. Gold Fields accepted the purchase of an aggregate principal amount of notes equal to U.S.$148 million at the purchase price of U.S.$880 per U.S.$1,000 in principal amount of notes. A profit of U.S.$18 million was recognized on the buy-back of the notes, resulting in a cash outflow of U.S.$130 million. The U.S.$594 million loans repaid in fiscal 2015 comprised: U.S.$ million U.S.$1,510 million term loan and revolving credit facility 302 R1,500 million Nedbank revolving credit facility 129 R500 million Rand Merchant Bank revolving credit facility 21 Short-term Rand uncommitted credit facilities 142 594 Net cash generated As a result of the above, net cash generated increased by 2,075% from U.S.$4 million in fiscal 2015 to U.S.$87 million in fiscal 2016. Cash and cash equivalents increased from U.S.$440 million at December 31, 2015 to U.S.$527 million at December 31, 2016. Liquidity and Capital Resources Years ended December 31, 2015 and December 31, 2014 Cash resources Cash Flows From Operating Activities Cash inflows from operating activities decreased by 8% from U.S.$809 million in fiscal 2014 to U.S.$744 million in fiscal 2015. The decrease of U.S.$65 million was due to: U.S.$ million Decrease in cash generated from operations due to lower operating profit (56 ) Increase in interest received due to higher cash balances 2 Decrease in release of working capital (40 ) Decrease in interest paid due to lower borrowings 17 Decrease in royalties paid due to lower revenue 12 Increase in taxes paid (13 ) Decrease in dividends paid due to lower normalized earnings 13 (65 ) 203 Table of Contents Dividends paid decreased from U.S.$42 million in fiscal 2014 to U.S.$29 million in fiscal 2015. The dividends paid of U.S.$29 million in fiscal 2015 comprised dividends paid to ordinary shareholders of U.S.$15 million, non-controlling interests in Ghana and Peru of U.S.$12 million and South Deep BEE dividend of U.S.$2 million. The dividends paid of U.S.$42 million in fiscal 2014 comprised dividends paid to ordinary shareholders of U.S.$30 million, non-controlling interests in Ghana and Peru of U.S.$10 million and South Deep BEE dividend of U.S.$2 million. Cash Flows From Investing Activities Cash outflows from investing activities increased by 23% from U.S.$531 million in fiscal 2014 to U.S.$652 million in fiscal 2015. The items comprising these numbers are discussed below. Additions to property, plant and equipment Capital expenditure increased by 4% from U.S.$609 million in fiscal 2014 to U.S.$634 million in fiscal 2015. Capital expenditure at South Deep in South Africa decreased from R994 million (U.S.$92 million) in fiscal 2014 to R848 million (U.S.$67 million) in fiscal 2015: • This decrease was mainly due to lower expenditure on new mine development. Capital expenditure at the Ghanaian operations increased from U.S.$190 million in fiscal 2014 to U.S.$221 million in fiscal 2015: • Tarkwa increased from U.S.$174 million to U.S.$204 million mainly due to increased expenditure on the purchase of mining fleet and additional capital waste stripping; and • Damang increased from U.S.$16 million to U.S.$17 million mainly due to increased expenditure on the processing plant upgrade and heavy vehicle equipment components. Capital expenditure at Cerro Corona in Peru increased from U.S.$51 million in fiscal 2014 to U.S.$65 million in fiscal 2015: • The increase in expenditure was on the raising of the tailings management facility and expenditure on the new fuel station and camp. Capital expenditure at the Australian operations increased from A$304 million (U.S.$274 million) in fiscal 2014 to A$373 million (U.S.$281 million) in fiscal 2015: • St. Ives increased from A$130 million (U.S.$118 million) to A$152 million (U.S.$115 million) due to increased expenditure on exploration and pre-stripping at the Invincible pit; • Agnew/Lawlers increased from A$92 million (U.S.$83 million) to A$97 million (U.S.$73 million) due to increased exploration expenditure; • Darlot increased from A$16 million (U.S.$15 million) to A$27 million (U.S.$20 million) due to increased capital development at LSL as well as additional exploration expenditure. • Granny Smith increased from A$65 million (U.S.$59 million) to A$96 million (U.S.$72 million) due to increased capital development and exploration. Proceeds on disposal of property, plant and equipment Proceeds on the disposal of property, plant and equipment decreased by 40% from U.S.$5 million in fiscal 2014 to U.S.$3 million in fiscal 2015. In both 2015 and 2014, this related to the sale of various redundant assets. 204 Table of Contents Proceeds on disposal of Chucapaca During 2014, Gold Fields sold its 51% interest in Canteras del Hallazgo (entity that houses the Chucupaca project in Peru) for U.S.$81 million to Compañía de Minas Buenaventura S.A.A. Purchase of investments Investment purchases decreased by 25% from U.S.$4 million in fiscal 2014 to U.S.$3 million in fiscal 2015. The purchase of investments of U.S.$3 million in fiscal 2015 comprised: U.S.$ million Mine Vision Systems 3 3 The purchase of investments of U.S.$4 million in fiscal 2014 comprised: U.S.$ million Rand Refinery Limited 3 Tocqueville Bullion Reserve Limited 1 4 Proceeds on disposal of investments Proceeds on the disposal of investments decreased from U.S.$6 million in fiscal 2014 to U.S.$nil in fiscal 2015. The proceeds on disposal of investments of U.S.$6 million in fiscal 2014 comprised: U.S.$ million Sale of shares in Robust Resources Limited 4 Sale of the Group’s interest in Talas (exploration project in Kyrgyzstan) 2 6 Environmental trust funds and rehabilitation payments The environmental trust fund and rehabilitation payments increased from U.S.$10 million in fiscal 2014 to U.S.$18 million in fiscal 2015. During 2015, Gold Fields paid U.S.$1 million into its South Deep mine environmental trust fund and U.S.$7 million into its Tarkwa mine environmental trust fund and spent U.S.$10 million on on-going rehabilitation at the international operations, resulting in a total cash outflow of U.S.$18 million for the year. During 2014, Gold Fields paid U.S.$1 million into its South Deep mine environmental trust fund and U.S.$6 million into its Tarkwa mine environmental trust fund and spent U.S.$3 million on on-going rehabilitation at the international operations, resulting in a total cash outflow of U.S.$10 million for the year. 205 Table of Contents Cash Flows From Financing Activities Cash outflows from financing activities decreased by 30% from U.S.$126 million in fiscal 2014 to U.S.$88 million in fiscal 2015. Equity contributions from non-controlling interest holders Equity contributions from non-controlling interest holders decreased from U.S.$2 million in fiscal 2014 to U.S.$nil in fiscal 2015. The U.S.$2 million received in fiscal 2014 related to cash advanced by Buenaventura in accordance with their obligations under the Chucapaca agreement. The reason for the decrease in equity contributions from non-controlling interest holders from 2015 to 2014 is the disposal of Chucapaca in August 2014. Loans raised Loans raised increased from U.S.$464 million in fiscal 2014 to U.S.$506 million in fiscal 2015. The U.S.$506 million loans raised in fiscal 2015 comprised: U.S.$ million U.S.$70 million senior secured revolving credit facility 10 U.S.$1,510 million term loan and revolving credit facilities 400 Short-term Rand uncommitted credit facilities 96 506 The U.S.$464 million loans raised in fiscal 2014 comprised: U.S.$ million La Cima revolving senior secured credit facility 42 U.S.$70 million senior secured revolving credit facility 35 U.S.$1,510 million term loan and revolving credit facilities 42 R500 million Rand Merchant Bank revolving credit facility 46 Short-term Rand uncommitted credit facilities 299 464 Loans repaid Loans repaid increased from U.S.$592 million in fiscal 2014 to U.S.$594 million in fiscal 2015. The U.S.$594 million loans repaid in fiscal 2015 comprised: U.S.$ million U.S.$1,510 million term loan and revolving credit facility 302 R1,500 million Nedbank revolving credit facility 129 R500 million Rand Merchant Bank revolving credit facility 21 Short-term Rand uncommitted credit facilities 142 594 206 Table of Contents The U.S.$592 million loans repaid in fiscal 2014 comprised: U.S.$ million U.S.$200 million non-revolving senior secured term loan 70 U.S.$70 million senior secured revolving credit facility 35 U.S.$1,510 million term loan and revolving credit facility 189 R500 million Rand Merchant Bank revolving credit facility 22 Short-term Rand uncommitted credit facilities 276 592 Net loans repaid decreased from U.S.$128 million in fiscal 2014 to U.S.$88 million in fiscal 2015. The decrease in net loans repaid was mainly due to lower operating cash flows and higher investing activities cash flows. Net cash generated As a result of the above, net cash generated decreased from U.S.$152 million in fiscal 2014 to U.S.$4 million in fiscal 2015. Cash and cash equivalents amounted to U.S.$440 million at December 31, 2015, as compared to U.S.$458 million at December 31, 2014. STATEMENT OF FINANCIAL POSITION Borrowings Total debt (short and long-term borrowings) decreased from U.S.$1,820 million at December 31, 2015 to U.S.$1,693 million at December 31, 2016. Net debt (total debt less cash and cash equivalents) decreased from U.S.$1,380 million at December 31, 2015 to U.S.$1,166 million at December 31, 2016 as a result of lower debt and higher cash balance. The Group monitors capital using the ratio of net debt to adjusted EBITDA. Adjusted EBITDA is defined as net operating profit before depreciation and amortization, adjusted for exploration expenses and certain other costs. The definition of adjusted EBITDA is as defined in the U.S.$1,290 million term loan and revolving credit facilities agreement. Net debt is defined as total borrowings less cash and cash equivalents. The Group’s long-term target is a ratio of net debt to adjusted EBITDA of one times or lower. The bank covenants on external borrowings require a net debt to adjusted EBITDA ratio of 2.5 or below and the ratio is measured based on amounts in United States dollar. Net debt to adjusted EBITDA at December 31, 2016 was 0.95 (2015: 1.38), surpassing the Group’s target of 1.0 which was set at the start of 2015. Refer to note 39 to the consolidated financial statements. Provisions Long-term provisions increased by 3% from U.S.$284 million at December 31, 2015 to U.S.$292 million at December 31, 2016 and included a provision for environmental rehabilitation costs of U.S.$283 million (2015: U.S.$275 million) and other long term provisions of U.S.$9 million (2015: U.S.$9 million). Provision for environmental rehabilitation costs The amount provided for environmental rehabilitation costs increased by 3% from U.S.$275 million at December 31, 2015 to U.S.$283 million at December 31, 2016. The increase is largely due to the increase in the gross closure costs at the Ghanaian and Peruvian operations. This provision represents the present value of closure, rehabilitation and other environmental obligations incurred up to December 31, 2016. This provision is updated annually to take account of inflation, the time value of money and any new environmental obligations incurred. 207 Table of Contents The inflation and range of discount rates applied in fiscal 2016 and 2015 for each region are shown in the table below: South Africa Ghana Australia Peru Inflation rates 2016 5.5 % 2.2 % 2.5 % 2.2 % 2015 5.4 % 2.2 % 2.5 % 2.2 % Discount rates 2016 9.7 % 9.7 – 9.8 % 1.9 – 3.0 % 3.7 % 2015 10.1 % 7.8 – 8.8 % 2.0 – 2.8 % 3.5 % The interest charge decreased by 8% from U.S.$12 million in fiscal 2015 to U.S.$11 million in fiscal 2016 mainly due to lower present values of the rehabilitation liabilities which resulted from an increase in discount rates used in the 2015 rehabilitation liabilities calculation. Adjustments for new disturbances and changes in environmental legislation during 2016 and 2015, after applying the above inflation and discount rates were: 2016 2015 (U.S.$ million) South Africa (2 ) (6 ) Ghana 8 5 Australia (8 ) (4 ) Peru 7 (9 ) Total 5 (14 ) The South African and Ghanaian operations contribute to dedicated environmental trust funds to provide financing for final closure and rehabilitation costs. The amount invested in the fund is shown as a non-current asset in the financial statements and increased by 29% from U.S.$35 million at December 31, 2015 to U.S.$45 million at December 31, 2016. The increase is mainly as a result of contributions amounting to U.S.$8 million and interest income of U.S.$1 million in fiscal 2016. The South African and Ghanaian operations are required to contribute annually to the trust fund over the remaining lives of the mines, to ensure that sufficient funds are available to discharge commitments for future rehabilitation costs. Other long-term provisions Other long term provisions remained flat at U.S.$9 million and include the South Deep dividend of U.S.$7 million (2015: U.S.$7 million) and other provisions of U.S.$2 million (2015: U.S.$2 million). Credit facilities At December 31, 2016, the Group had committed unutilized banking facilities of available under the following facilities, details of which are discussed in note 24 to the consolidated financial statements: • U.S.$632 million available under the U.S.$1,290 million term loan and revolving credit facilities; • U.S.$68 million available under the U.S.$150 million revolving senior secured credit facility; • U.S.$25 million available under the U.S.$70 million senior secured revolving credit facility; • U.S.$148 million available under the U.S.$1 billion notes as the notes bought back were never cancelled; and • U.S.$107 million (R1,500 million) available under R1,500 million Nedbank revolving credit facility. 208 Table of Contents Substantial contractual arrangements for uncommitted borrowing facilities are maintained with several banking counterparties to meet the Group’s normal contingency funding requirements. As of the date of this report, the Group was not in default under the terms of any of its outstanding credit facilities. Contractual obligations and commitments as at December 31, 2016 Payments due by period Total Less than 12 months 12-36 months 36-60 months After 60 months (U.S.$ millions) Long-term debt Notes Issue Capital 852.4 — — 852.4 — Interest 157.1 41.6 83.1 32.4 — U.S.$150 million revolving senior secured credit facility Capital 82.0 82.0 — — — Interest 1.9 1.9 — — — U.S.$1,290 million term loan and revolving credit facility Capital 658.5 — 658.5 — — Interest 50.2 20.6 29.6 — — U.S.$70 million senior secured revolving credit facility Capital 45.0 45.0 — — — Interest 0.5 0.5 — — — Short term Rand credit facilities Capital 61.0 61.0 — — — Interest 5.1 5.1 — — — Operating lease obligations 549.7 42.5 116.2 113.7 277.3 Other long-term obligations Environmental obligations(1)(2) 380.8 3.6 7.7 22.1 347.4 Total contractual obligations 2,844.2 303.8 895.1 1,020.6 624.7 Notes: (1) Gold Fields makes full provision for all environmental obligations based on the net present value of the estimated cost of restoring the environmental disturbance that has occurred up to the reporting date. Management believes that the provisions made for environmental obligations are adequate to cover the expected volume of such obligations. (2) Represents the undiscounted liability. Amounts of commitments expiring by period Total Less than 12 months 12-36 months 36-60 months After 60 months (U.S.$ millions) Other commercial commitments Guarantees(1) — — — — — Capital expenditure 46.2 46.2 — — — Total commercial commitments 46.2 46.2 — — — Note: (1) Gold Fields provides environmental obligation guarantees with respect to its South African, Peruvian and Ghanaian operations. These guarantees amounted to U.S.$100.1 million at 31 December 2016. 209 Table of Contents Working capital Management believes that Gold Fields’ working capital resources, by way of internal sources and banking facilities, are sufficient to fund Gold Fields’ currently foreseeable future business requirements. Off balance sheet items At December 31, 2016, Gold Fields had no material off balance sheet items. Recent Developments See “Information on the Company—Developments since December 31, 2015”. Trend and Outlook Attributable equivalent gold production for the Group for fiscal 2017 is expected to be between 2.10 million ounces and 2.15 million ounces, unchanged from the updated guidance provided in fiscal 2016. The Australian operations are expected to produce around 910,000 ounces. Cerro Corona’s gold equivalent production of around 290,000 ounces is higher than 2016 with the increase mainly due to the positive impact of the higher copper/gold price ratio. Lower production is expected at Damang given the reinvestment currently underway and South Deep is expected to increase production to around 9,800 kilograms (315,000 ounces). The all-in-sustaining cost for the Group is expected to be between U.S.$1,010 per ounce and U.S.$1,030 per ounce. Gold Fields plans to embark on a year of reinvestment in fiscal 2017 with the focus on new growth and development projects, and to target both sustaining and growing free cash flow. Apart from the growth invested in South Deep, three other major projects namely the Damang Reinvestment Plan, the Gruyere Gold Project and the Salares Norte project require significant investment. Growth expenditure at South Deep is planned to increase to R287 million (U.S.$20 million) in fiscal 2017 (2016: R115 million/U.S.$8 million). In fiscal 2017, U.S.$120 million will be invested in future growth at Damang, while the A$153 million (U.S.$112 million) is planned to be spent on the development of Gruyere. In Chile, Salares Norte received water rights and the project is on track to complete a prefeasibility study in the second half of fiscal 2017. The plan is to increase expenditure to U.S.$64 million at Salares Norte in fiscal 2017 (2016: U.S.$39 million). As a result of the above, AIC for the Group is planned to increase significantly to between U.S.$1,170 per ounce to U.S.$1,190 per ounce. Group capital expenditure for the year is planned at U.S.$870 million. It includes U.S.$120 million at Damang and A$153 million (U.S.$112 million) for Gruyere, as well as R287 million (U.S.$20 million) at South Deep. These expectations assume exchange rates of R/U.S.$: 14.14 and A$/U.S.$: 0.73. 210 Table of Contents