Good afternoon, ladies and gentlemen, and welcome to the Gold Fields Limited Second Quarter Results Conference. All participants are currently in listen-only mode. And Mr. Holland will brief you on the results and will take questions after that. [Operator Instructions] Please also note that this call is being recorded. I would now like to hand the conference over to Mr. Nick Holland. Please go ahead sir.

Thank you, Dylan, and good afternoon or good morning ladies and gents wherever you might be in the world today. Thanks for joining us to discuss the results of Gold Fields' for the second quarter of 2015, and of course, the half year. On the call today with me today, I've got Paul Schmidt, our Chief Financial Officer; I've got [Kgabo Moabelo] [ph], the Executive Vice President of our South Africa region, Avishkar Nagaser, Investor Relations and Taryn Harmse, our Group General Counsel. Operational and financial highlights for the quarter are; gold production up 7% to 537,000 ounces, group all-in sustaining costs down 10% to $1029 an ounce. All-in costs 9% down at $1059 an ounce. Normalized earnings were $22 million compared to a loss of $13 million in the previous quarter. Importantly we had a $59 million swing in net cash flow to an inflow of $30 million in quarter two from a net outflow of $29 million in quarter one, and just to remind you in quarter one, it wasn't that it was a poor quarter, we had mine scheduling that skewed production towards the second, third and fourth quarters and we didn't want to disturb that schedule and get out of sequence, so we honored the mining portfolio was determined by the engineers on the mine. And at the same time, we also had some of the capital that was front ended in quarter one, and again, that's just timing of capital. So on a year-to-date basis, we are pretty much in line with where we expect to be in terms of our production and we're below in terms of where we thought we would be on our costs. Free cash flow margin was 9% in quarter two despite a slightly lower gold price in the June…

Thank you very much sir. [Operator Instructions] We have a question from Howard Flinker from Flinker Co. Please go ahead.

Hello everybody.

Hi, Howard.

I have two questions for you, one might be a tough question. The first one is what caused the other category of expenses to drop? There was a category called other and it dropped somewhat significant?

Okay. The second one?

The second one, did I read somewhere that in your exploration you think you could find gold within properties or adjacent to your properties around $20 or $25 an ounce something like that?

Yes. I'll take the second question, Howard and Paul, our CFO will respond to you on your first question. So what we were saying is that our strategy has been very focused on brownfields exploration on our mine sites because the best place to find gold is where you're currently mining it, and we know that our leases are very perspective. Well, we've looked around outside of our leases too and we think there is opportunities as well. Now it's quite strategic because we've got spare process capacity, Howard. So if we can find deposits that we can economically try or from outside of our lease and fill in our plant it might be good business. So that's a strategy we're looking at. We're talking to a number of people. It might be tolling arrangements; it might be acquisitions; it might be joint ventures, let's see where we go, but that's the idea. Hopefully that gives you a better perspective.

Here is the hard part of the question. If you're shooting for $20 or for $25 because Mother Nature doesn't going to cooperate?

Yes. Look we're not necessarily shooting for that. I don't know where that number came from, but…

One of your releases, I'm not sure if I saw it correctly, if I didn't please correct me.

No. I don't think we said it would be that cheaper. I think it will be potentially more expensive than that.

No. My point is even more acute. Why do that when there are sound operating companies with experienced management selling for $4, $5, $10 an ounce of gold in the ground and nothing for a silver or stated in another way $1 or $2 for sliver and nothing for its gold. And these are not how we Flinker are going out and getting a shovel and say hey I think I found something somewhere in Mexico. These are experienced people.

Yes.

My question is, are you being too narrow minded and stubborn to look next door to where you have instead of looking outside?

Yes. Look I mean we could look outside, but Howe, one of things we've decided is standard on operations we would only be interested in in-production assets. I don't want to go and buy projects that we still going to try and build and often have major overruns and I'm interested in near-term cash flows with the team here.

There is some of either, I'm glad I own some of them.

Great. But that's not our business model. So our business model is to buy in-production like we did in Australia. We bought in-production assets. We bought 500,000 ounces of annual production of $270 an ounce and we're going to get pay back at the end of the year which is two years. So that's what we're interested in. I mean, it's tough to repeat those. But we used to do all that stuff Howard and the problem is, we didn't have enough focus. We were all over the place in terms of looking at different things and that's why we had a portfolio that was spread over the world and we didn't do justice to it. So we're getting focused again.

You might be focused in the wrong direction if there are operating companies with $5 and $10 an ounce and you're shooting for acquisitions to 270, that's my point.

Point taken Howard. Thank you. And Paul's question.

Howard the other cost decreased from $10.1 to $8.6 and the bulk of it is the rehab costs. Then the main reason it would have decreased is because of the weakening of the Aussie dollar and the real when they get converted into U.S. dollars. But it's only down by $1 million, it's not a big number $1.5 million, it's tiny.

Oh, I thought its $4 million or $5 million or $7 million.

That's 10.1 to 8.6 quarter-on-quarter.

Oh, my mistake. Okay. Thanks.

Thank you very much. Our next question is from Andrew Byrne from Barclays. Please go ahead.

Hi, good afternoon, Nick. Just a bit of an idea, in the presentation this morning you kind of intimated us there is an awful lot going on in Australia on the exploration side on potential M&A. Is it possible you could just flush out kind of, a) what your existing capacity is at the moment, and the capacity violation there, and then looking ahead three or four years what type of production base would you like to have in the region?

Well, the spare capacity we talked about Andrew was on the process side where we're using about 60% of what we've got across all the four mines. So we've got 40% of unutilized capacity. If you look at Granny Smith, we've probably got around about 1.8 million tons Darlot we probably got about 300,000 tons; Agnew we've got around about 600,000 to 700,000 tons; and at St. Ives we've probably got around about 1.5 million tons. So that's our spare capacity. So we're working very hard obviously on the lease and spending $85 million a year and our budgeted exploration made this year a 456,000 meters, which is like double of what we have done before. But, we're saying let's look beyond the boundaries of the lease and see if we're not successful on brownfields or if we are can we find other things that might be better that we can sequence better. I don't know what the three or four year profile is going to look like at this stage, Andrew. We haven't got figures that we're able to release to you. But the first and most important objective is to try and keep the production and critical mass at the four mines compared to where they are now. So that's why we are aggressively spending on the exploration. So I'd like us to be able to keep where we are if we can. Obviously, we want to try and keep the costs where they are as well or even lower, so we'll be going for grade like back at [indiscernible] is giving us an open pit that has a much higher grade than what we've seen before that's the best scale. [Ayaton] [ph] was probably as big enough pit in terms of tons, but it was half the grade that we're getting it invincible. So I can't give you definitive answers yet, but as a minimum we want to try and maintain a production profile and improve the costs by focusing on grade and if you can feel some of the capacity over time even better. Did that help you?

Yes. Yes. That's great. Thanks.

Thank you very much. [Operator Instructions] Our next question is from [Justin Chen] [ph] from JMP Securities. Please go ahead.

Hi, gents. I'm just taking the focus to South Deep for a minute. So in the first half you produced – call it 2500 kilograms and so to reach your annual guidance of 6500 kilograms that implies approximately 4000 at the second half of the year, just comparing to your run rate of 500,000 tons at roughly 4.5 grams, do you expect grade to lift in the second half or most of the change be in tonnage?

We expect improvements in both volume will grade will be due to seasonal variations between the first and the second year and also the consequence of an increase in the number of loss contributions that we are going to have a significant increase in the number of [indiscernible]. We are also expecting productivity improvements through some of the operational improvements as we are bringing to effect as well as the 27 units of new capital fleet that have acquired. Thank you.

Okay. Thanks guys.

Thank you very much. [Operator Instructions] As it appears that we have no further questions. Do you have any closing comments?

No. I'd just like to say that it's nice to see a little bump in the gold price. And obviously, that flow through to the equities, but we probably could expect more volatility in the gold price and the market. So I think we just got to just keep focused on delivering on our production commitments and our cost commitments doing it safely and the markets will determine what that is worth. But thanks and we hope to talk to you again soon. Thank you, Dylan, and good bye.

Thank you very much, sir. Ladies and gentlemen on behalf of Gold Fields Limited that concludes this afternoon's conference. Thank you for joining us. And you may now disconnect your lines.