Harmony lifts Q1 output, posts highest ever quarterly revenue

JOHANNESBURG (miningweekly.com) – Harmony Gold recorded its highest ever quarterly revenue of R5.25-billion in the three months to September 30.

Revenue for the first quarter of the company’s 2017 financial year was 9% higher quarter-on-quarter, on the back of a 10% increase in production to 277 461 oz, compared with the 253 349 oz produced in the quarter ended June 30.

Underground recovered grade increased by 5.5% quarter-on-quarter to 5.01 g/t. Development grades at all operations – except for Target 1 – are also in line with expectations and support the expected grade in the life-of-mine plan.

At Kusasalethu, better-than-expected grades were intersected during the quarter.

At Target 1, unstable ground conditions hampered further mining in the higher-grade areas. Action plans include an increased focus on development to ensure that mining flexibility improves, with higher grades only expected by the third quarter of the 2017 financial year.

Cash operating costs for the September quarter increased by 12%, owing to an increase in labour costs and higher electricity costs.

Harmony’s all-in sustaining costs fell 1% to R516 116/kg, despite the seasonal effect of winter electricity tariffs.

The operations generated positive free cash flow of R850-million, allowing the miner to reduce net debt by 51% from R1.08-billion to R528-million, after paying a dividend of R218-million.

Harmony remains on track to achieve its yearly production guidance of 1.05-million ounces.