JOHANNESBURG (miningweekly.com) – Gold mining company Harmony Gold on Tuesday reported 106% increase in operating free cash flows on a 25% improvement in the rand gold price.
In financial year (FY) 2020, the gold price received was R735 569/kg, resulting in a 9% increase in revenue to R29.25-billion.
In the year to June 30, the company, headed by CEO Peter Steenkamp, reported a 9% increase in production profit to R7.197-billion (FY19: R6.588-billion).
Average underground recovered grade fell by 3% to 5.45 g/t with the company achieving a better than expected production fourth-quarter performance despite Covid-19 challenges.
The Johannesburg- and New York-listed company reported a 67% improvement in loss a share to R0.164 (71% improvement to $0.10) and a 175% decrease in headline loss a share to R0.154 (171% decrease to $0.10).
No ordinary cash dividend was declared for the year ended June 30, as was the case in 2019.
“Harmony continues to make good progress in executing its strategy of producing safe, profitable ounces and increasing margins. Our drive for safe ounces was never more applicable than in the last quarter of the financial year as we 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 restart of mining in the country, we're pleased to report higher than anticipated production and substantial delivery against our strategy in the last quarter of the year,” Steenkamp said.
He added that Harmony was well-positioned to benefit from the anticipated continuing strength of the gold price.
The newly acquired Mponeng and Mine Waste Solutions assets would, he said, help grow production and, as conditions improved, Harmony had other Tier 1 projects, such as Wafi-Golpu in Papua New Guinea, and a pipeline of organic projects in South Africa, including Target North, to incorporate into its portfolio.
In the next financial year, he said that Harmony planned to produce between 1.25-million ounces and 1.3-million ounces at an all-in sustaining unit cost of between R690 000/kg and R710 000/kg. Underground recovered grade would likely be between 5.53 g/t and 5.58 g/t and guidance would be updated once Mponeng and Mine Waste Solutions had been integrated into Harmony’s asset portfolio.