An increase in recovered grades at Harmony Gold’s South African underground gold mining operations has resulted in a solid performance for the nine months to March 31.

“The high-grade assets of Mponeng [in Gauteng] and Moab Khotsong [in the Free State] transformed the Harmony portfolio due to their high-quality ounces,” the company said in an operational update published on May 10.

These higher underground recovered grades continued through from the first half of the financial year into the third quarter. Harmony reported that average recovered grades increased by 7% to 5.68 g/t for the period, up from 5.39 g/t in the same period in the prior financial year – after adjusting for the closure of Bambanani mine at the end of 2022.

The improved grades contributed to Harmony posting an 11% increase in revenue to R33.98-billion for the nine-month period, up from R30.67-billion for the same period in the 2022 financial year.

A higher average gold price received also contributed to the increase in revenue, which went up by 13% to R992 899/kg from R877 249/kg.

Group production for the period also increased, by 2%, to 33 785 kg from 33 241 kg a year ago.

Costs went up too, but Harmony said cost increases remained within its planning parameters.

As such, cash operating costs for the period increased by 7% year-on-year to R745 682/kg from R697 146/kg. All-in sustaining costs (AISC) increased by 8% to R895 580/kg from R825 925/kg, while all-in costs increased by 10% to R940 559/kg from R851 291/kg.

As a result, group operating free cash flow increased by 49% to R3.24-billion, up from R2.17-billion a year ago.

“Major capital is being allocated to quality ounces across Harmony as we continue the transition towards a higher-margin, lower-risk gold producer with a meaningful copper footprint,” Harmony said on May 10.

The company added that it believed its investment in quality ounces was paying off as Mponeng delivered a 192% increase in operating free cash flow of R1.27-billion for the nine-month period from R437-million in the previous comparable period.

Harmony further reported that key projects, such as the extension of the Kareerand tailings storage facility at Mine Waste Solutions in the North West and the Zaaiplaats decline at Moab Khotsong were also progressing well.

Meanwhile, in Papua New Guinea, the company said the mining operation at the Hidden Valley mine was expected to intercept the higher-grade Big Red portion of the orebody, which would result in improved gold and silver recovered grades for the remainder of the financial year.

Harmony’s net debt decreased to R4.51-billion from R4.71-billion as at the end of last year, with the net debt to earnings before interest, taxation, depreciation and amortisation decreasing to 0.5 times from 0.6 times as a result.

In terms of safety, Harmony reported a total lost time injury frequency rate of 5.55 at its South African operations, trending below six for six consecutive quarters.

“We remain focused on safety, effective cost management and delivering consistent production,” the company said.

Moreover, Harmony said it had managed to ensure that production was not meaningfully impacted by the ongoing energy shortages in South Africa by implementing proactive engineering and mining practices.

The company stated that Phase 1 of its 30 MW solar power plant in the Free State was on track to be commissioned before the end of the 2023 financial year.

“We have a phenomenal choice of greenfield and brownfield projects at our disposal, while our copper projects offer good optionality and diversification,” Harmony boasted.

Meanwhile, progress continues to be made on the permitting of Wafi-Golpu in Papua New Guinea, with the signing of a nonbinding memorandum of understanding on April 6.

Additionally, Harmony said the results of the updated feasibility study for the Eva Copper mine, in Australia, would be complete and published before the end of the year.