Gold Fields

Stocks Movement Analysis: Gold Fields Ltd.

Gold Fields Ltd. (NYSE:GFI) retreated -4.98% and closed its last session at $4.01. The stock has the market capitalization of $3.46 Billion with the total outstanding shares of 861.62 Million. Gold Fields Ltd. has Analysts’ Mean Recommendation of 3 between the scale of 1 to 5 (1 represents Strong Buy and 5 means Sell). The stock currently has P/E of 0 for trailing twelve months while its Forward P/E is 8.61.

Gold Fields Ltd. (NYSE:GFI) touched its 52-Week High of $6.6 on Aug 11, 2016 while it’s 52-Week Low of $2.04 on Nov 18, 2015. The company currently has Return on Assets of 0 percent, Return on Equity of 0% and Return on Investment of -1.6 percent. The stock is currently showing Weekly Volatility of 4.59%% and Monthly Volatility of 4.65% Percent with Average True Range of 0.25 and Beta of -0.77.

The 13 analysts offering 12-month price forecasts for Gold Fields Ltd have a median target of 6.47, with a high estimate of 9.01 and a low estimate of 4.39. The median estimate represents a +61.42% increase from the last price of 4.01.

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Botched Russian deal forced BCL’s closure

A letter of demand for BCL Mine to pay P3 billion to Norilsk Nickel Africa to fulfil a 2014 agreement to buy a 50% stake in the Russian company’s Nkomati Mine in South Africa, has emerged as the key factor that forced government to ‘hurriedly’ place the miner under provisional liquidation.

As part of the 2014 deal, BCL entered into a binding agreement to buy the stake in Nkomati from Norilsk Nickel Africa pending regulatory approvals in South Africa. BCL Mine entered into the deal as part of its Polaris II strategy to invest into alternative sources of ore, in light of the declining grades and reserves in Selebi-Phikwe.

In August 2016, South Africa’s Department of Minerals gave its final approval and the Russians, in line with the binding agreement, moved in to collect.

However, BCL had fallen on hard times, its incremental losses over the decades worsened by record low base metal prices, where the Mine was losing US$4 for every pound of nickel.

“Norilsk now wants its money and they have even threatened to take BCL and the Botswana government to court. If they were the ones to had applied for liquidation, it would have meant government losing control of the mine as the liquidator would then be serving the interests of the creditors and not the shareholder as it is the case now.

“Government could not afford to run the risk of the Mine’s assets being stripped to pay off creditors, especially the prized smelter which cost close to a billion pula to refurbish just last year,” said an impeccable source close to the latest developments.

On Tuesday, BCL Ltd chair, Khaulani Fichani hinted that the decision to enter into provisional liquidation was a strategic one aimed at protecting the Mine from a possible lawsuit from the Russians. “When we got the approval from South Africa, it meant the agreement was now done,” Fichani said in response to questions. “When the share transfer was approved, BCL was now owing Norilsk Nickel an amount close to P3 billion.

“The kind of situation that we are in, where’s that money going to come from. You can either wait for the letter of demand to come saying you owe us P3 billion, or you can ask for the protection of the courts to say I’m not able to pay.

“If a creditor comes and forces you into provisional liquidation, they have the powers to supervise the process. The way we have done it is to give that power to the provisional liquidator and look at the options of revising the business.

Read more at Mmegi

I trust you enjoyed reading these mining news articles.  Enjoy your day!  Chris.

Dust Monitoring Equipment – providing equipment, services and training in dust fallout management to the mining industry.

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