Harmony Gold reports 9% increase in production profit

Harmony continues to make good progress in executing its strategy of producing safe, profitable ounces and increasing margins. Its drive for safe ounces was nevermore applicable than in the last quarter of the financial year as the company faced the challenge of managing and mitigating the risks presented by the COVID-19 pandemic.

“Despite the impact of the South African lockdown and phased re-start of mining in the country, we are pleased to report higher than anticipated production and substantial delivery against our strategy in the last quarter of the year,” Peter Steenkamp, chief executive officer of Harmony said.

He added that “Harmony is well-positioned to benefit from the anticipated continuing strength of the gold price. The newly acquired assets will help grow production and, as conditions improve, Harmony has other Tier 1 projects such as Wafi-Golpu and a pipeline of organic projects in South Africa to incorporate into its portfolio.”

FY20 key features:

• 9% increase in production profit to R7.197 billion (FY19: R6.588 billion)
• 3% decrease in average underground recovered grade at 5.45g/t (FY19: 5.59)
• 9% increase in revenue to R29.2 billion (FY19: R26.9 billion)
• The company achieved a better than expected production performance in Q4 of FY20 despite Covid-19 challenges
• Gold produced 37 863 kg (Year ended June 2019 = 44 734 kg)
• 25% increase in average gold price received at R735 569/kg(FY19: R586 653/kg)
• 67% improvement in loss per share to 164 SA cents (71% improvement to 10 US cents)(FY19: loss of 498 SA cents (35 US cents))
• 175% decrease in headline loss per share to 154 SA cents(171% decrease to 10 US cents)(FY19: earnings of 204 SA cents (14 US cents))

FY21 GROUP PRODUCTION AND COST GUIDANCE In the next financial year, we plan to produce between 1.25Moz and 1.3Moz at an all-in sustaining unit cost of between R690 000/kg and R710 000/kg. Underground recovered grade is planned to be between 5.53g/t and 5.58g/t. Guidance will be updated once Mponeng and Mine Waste Solutions have been integrated into Harmony’s asset portfolio.