Sibanye Gold reported record quarterly production for Q3 2014 with the gold producer noting that is full year production guidance is on track.

The group’s Q3 2014 gold output was 10% higher than the comparable quarter in 2013.

The South African miner achieved record gold production of 424 700 oz with it Cooke mines boosting production and contributing to operating profit of $167 million for the quarter.

Cooke Operations full production

The record production was primarily due to a solid performance from its Kloof, Driefontein and Beatrix underground operations and the inclusion of a full quarter’s production from the Cooke Operations for the first time.

Sibanye continues to invest in its future, with a significant increase in ore reserve development year-on-year.

The company also saw significant cost increases in the quarter, as a consequence of the 2014 annual wage increases which were implemented from July, and the higher winter power tariff, stated the company.

Full-year guidance on track

Sibanye is well on track to deliver on annual guidance, said CEO Neal Froneman commenting on the Q3 2014 report.

“Although we had a solid quarter from the majority of our operations we have seen our margins decrease to 11% during this quarter as we have incurred both winter electricity price tariffs and the 2014 annual wage increases,” he said.

Froneman said Sibanye’s management team will, as it has in the past, work out these above inflation cost increases over time.

Steady operating profit

Sibanye’s operating profit remained steady and would continue to underpin the company’s ‘benchmark dividend policy’, said Froneman.

Forecast production for the year ending 31 December 2014 remains unchanged at 1.61Moz.

The company expects to reach full production of uranium at the Cooke mines in the middle of next year, which would serve as a by-product credit to lower the group’s cost of gold production.

Sibanye produced 56 705 pounds of uranium during the September quarter for $34/pound, but it had not sold its uranium.