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South Africa's Gold Fields profit soars on surge in bullion prices

JOHANNESBURG (Reuters) - South African miner Gold Fields reported a four-fold jump in half-year earnings on Thursday, benefiting from a surge in the price of the precious metal and lower-than-expected COVID-19 impact on its output.

A worker cleans gold bars at South Africa's Gold Fields South Deep mine in Westonaria, 45 kilometres south-west of Johannesburg, South Africa, March 9, 2017. Picture taken March 9, 2017. REUTERS/Siphiwe Sibeko/Files

Headline earnings per share, the main profit measure in South Africa, for the six months ended June 30, rose to $0.20, from $0.05 a year earlier.

Record gold prices and a weaker rand have given the South African gold industry, which has produced a third of the bullion mined in history, a lifeline after the disruption caused by the COVID-19 pandemic.

“A bittersweet respite for gold companies has been the rise in this safe haven metal to record levels,” said Chief Executive Officer Nick Holland.

The company produced 1.087 million ounces of gold during the period, marginally up from 1.083 million ounces a year ago, despite lockdowns and infection control measures.

Output from Gruyere in Australia and an increase in production days offset the impact of COVID-19 stoppages at South Deep in South Africa and the Cerro Corona mine in Peru, the company said.

Gold Fields estimated it lost output of 42,000 ounces due to COVID-19-related stoppages.

The company, which also has operations in Ghana and the Salares Norte project in Chile, lowered its 2020 gold production forecast to between 2.200 million ounces and 2.250 million ounces, from 2.275 million ounces and 2.315 million ounces.

The company declared an interim dividend of 1.60 rand ($0.093) per ordinary share, up from 0.60 rand ($0.03) per ordinary share a year earlier.

($1=17.2787 rand)

Reporting by Tanisha Heiberg; Editing by Clarence Fernandez, Aditya Soni