Sibanye H2 operating profit up as output rises, costs decline

JOHANNESBURG, Feb 20 (Reuters) - South African-focused bullion producer Sibanye Gold SGLJ.J reported a 19 percent rise in operating profit for the six months to the end of December, despite a fall in the precious metal's spot price, as it reigned in costs and ramped up output.

The Gold Fields' GFIJ.J spin-off, created last year, also approved a maiden final dividend of 75 cents per share for the period, resulting in a total dividend of 112 cents in 2013 and bringing its dividend yield to 5.5 percent based on its closing share price on Tuesday.

Sibanye has positioned itself as a company with mature assets that can generate solid dividends.

Production increased by 18 percent to 773,600 ounces over the period, which also saw a 15 percent decline in the average gold price compared with the previous six months.

But a weaker local currency meant that in rand terms the average bullion price was only 7 percent lower.

Total cash costs fell 10 percent from the previous six months to $804 an ounce.

Sibanye has cut costs by, among other things, trimming its workforce to 35,000 from 42,000, but in South Africa's tough labour environment, with growing union militancy, it may find it hard to make further big staff reductions.

Headline earnings per share were 195 cents but are not really comparable to the previous six months because the company only listed in mid-February last year.

This means that while it has 733 million shares in the previous period, the latest calculation is based on an average of 566 million shares and so is not really comparable.

Operating profit came in at around 4 billion rand from 3.37 billion rand, an increase of 19 percent.

(Reporting by Ed Stoddard; Editing by David Holmes)

((Edward.Stoddard@thomsonreuters.com)(+27 11 775 3160)(Reuters Messaging: edward.stoddard.thomsonreuters.com@reuters.net))

Keywords: SIBANYE RESULTS/