Harmony says it is no longer marginal


Harmony says it is no longer marginal


Published Date: 2021-02-24 | Source: Stephen Gunnion | Author: Stephen Gunnion

Harmony says it is no longer marginal

The gold mining company says its growth strategy of the past five years has resulted in a diversified and de-risked asset portfolio.

Harmony Gold Mining Company has resumed dividend payments following a strong first-half performance which it says substantiates its growth strategy of the past five years.

Releasing results for the six months to end-December, the company said through astute acquisitions it had successfully added quality ounces of gold to its portfolio. These include last year's acquisition of AngloGold Ashanti's remaining gold assets in the country, which boosted production for the six months.

Total gold produced over the six months to end-December rose 8% to 745,347 ounces, while the average price it received for its metal rose 19% in dollar terms to $1,716 per ounce. In rand, it was 31% higher.

On top of the benefit of the higher rand gold price, Harmony said it also benefited from gains on derivatives and foreign exchange translations gains. It said the Mponeng and the other gold assets it acquired from AngloGold Ashanti contributed R3 billion in revenue for the period and R2 billion in production costs. It recognised a gain on bargain purchase of R1.15 billion on the acquisition, taking into account fair value adjustments and provisions between what it paid for the acquisition and their net asset value. Some of the gains it made over the six months were offset by higher tax expenses.

Revenue rose 39% to R21.6 billion and net profit increased by 336% to R5.8 billion. That resulted in headline earnings per share of 775c, up 211% from a year earlier. It declared an interim dividend of 110c.

Harmony's shares declined 0.5% to R57.61 yesterday.


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