Thursday, August 5, 2010

Gold Fields' (NYSE:GFI) Nick Holland Says Company Not Relying On Gold Price

The CEO of Gold Fields (NYSE:GFI), Nick Holland, said in an interview that the company isn't going to rely on gold prices to "bail us out." Holland added that the company is actually going to budget a lower price than the spot price is today.

This isn't to say he believes gold prices are going to fall, but that the company needs to focus on streamlining their operations, and that's going to be the focus over the next year, said Holland.

Holland added the gold price will move where it moves, and that's outside the control of the company, he wants to focus on what the company can control, and he's going to do that by putting all aspects of the business processes under review.

The goal is to improve the profitability of the cash flow for each ounce of gold that comes out of the ground.

Holland's goal is to widen margins, which this year were 15 percent. He wants to bring that to 20 percent no matter what price gold ends up at.

I think this is what gold mining companies around the world should be doing, as some miners had much larger revenues but dropped the ball on costs and margins, which lowered earnings.

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