UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a16 OR 15d16 UNDER THE
SECURITIES EXCHANGE ACT OF 1934
For May 11, 2021
Harmony Gold Mining Company Limited
Randfontein Office Park
Corner Main Reef Road and Ward Avenue Randfontein, 1759
South Africa
(Address of principal executive offices)*-
(Indicate by check mark whether the registrant files or will file annual reports under cover of
Form 20 F or Form 40F.)
Form 20F ☒ Form 40F ☐
(Indicate by check mark whether the registrant by furnishing the information contained in this form is also thereby furnishing the information to the Commission pursuant to Rule 12g32(b) under the Securities Exchange Act of 1934.)
Yes ☐ No ☒
Harmony Gold Mining Company Limited
Incorporated in the Republic of South Africa
Registration number: 1950/038232/06
JSE share code: HAR
NYSE share code: HMY
ISIN: ZAE000015228
(“Harmony” or “the Company”)
| | |
OPERATIONAL UPDATE for the nine months ended 31 March 2021 |
Significant jump in EBITDA margin translates into strong cash generation
Johannesburg, South Africa. Tuesday, 11 May 2021. Harmony Gold Mining Company Limited (“Harmony” or “the Company”) is pleased to report its operational performance for the nine months ended 31 March 2021.
Harmony has delivered another strong set of operational results year-on-year on the back of the successful integration of Mponeng and related assets into its portfolio, and a stronger Rand per kilogram gold price. The combination of a higher gold price received and improved EBITDA margin has resulted in strong cash generation and further strengthening of the Company’s balance sheet. Growing the Company’s ounces and margins in a safe and capital-responsible manner will guide each of its decisions as it continues to invest in both its people and its assets.
With a sturdy balance sheet and astute capital decisions, Harmony is well positioned for the next phase of its growth strategy. The Company has a pipeline of cash-enhancing projects which will boost its cash flow margins and sustain its production for many years to come. In addition, the tier 1 Wafi-Golpu project offers both commodity and geographic diversification, further transforming Harmony’s portfolio as it focuses on becoming a lower risk and higher margin business.
Harmony has a proven track record in sustaining communities, creating jobs and unlocking significant value from assets well beyond their initial life of mine. Environmental, Social and Governance (“ESG”) practices are embedded in how the Company operates and makes decisions to ensure sustainable mining. Through its successful track record, Harmony has become not only the South African gold mining champion, but also an established player in Papua New Guinea.
Harmony has an exciting story to tell and a wealth of emerging market experience. The combination of its existing asset portfolio, Wafi-Golpu and other brownfield projects will allow the Company to build on its copper-gold story while it continues to create value for all shareholders and stakeholders.
Nine months of the financial year 2021 (“FY21”) – Key operational metrics*
| | | | | | | | | | | | | | | | | | | | |
|
| Unit | Y-on-Y
move | Y-on-Y
% | Nine
months
FY21 | Nine
months
FY20 | Comments |
| Gold price | R/kg | é | 23.3 | 868 964 | 704 965 | Higher US$ gold price and weaker Rand contributed to a higher Rand gold price received |
| Underground yield | g/t | é | 2.6 | 5.54 | | 5.40 | | Improved grade at Kusasalethu, as well as the introduction of higher grades from Mponeng |
Adjusted EBITDA# | Rm | é | 360 | 9 439 | | 2 050 | | Increased due to an improved Rand gold price received and higher average grade and production post acquisition of Mponeng and related assets |
| Adjusted EBITDA margin | % | é | 241 | 31 | 9 | Increased on the back of improved Rand gold price received and higher margins received at Mponeng and surface source operations |
| Gold produced total | kg | é | 13.5 | 34 969 | 30 814 | Successful integration of Mponeng and related assets and improved production year-on-year |
| oz | é | 13.5 | 1 124 274 | 990 691 |
| Production – South Africa | kg | é | 15.9 | 31 470 | 27 154 | Successful integration of Mponeng and related assets |
| Production – Hidden Valley | kg | ê | (4.4) | 3 499 | 3 660 | As a result of lower labour productivity due to COVID-19 working roster and travel restrictions |
| All-in sustaining cost (“AISC”) | R/kg | é | (15.8) | 720 572 | 622 458 | Higher royalties, unplanned COVID-19 related expenses and increased labour costs due to overtime. Other expenses which contributed to higher costs were consumables and contractors while Target 1 also contributed to an overall higher AISC |
| US$/oz | é | (9.1) | 1 416 | 1 298 |
| | | | | | |
* The financial information has not been reviewed by the Company’s Auditors
# The Company reports adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) and non-recurring events. For the reporting period, the non-recurring events include the gain on bargain purchase and acquisition-related costs. Adjusted EBITDA may not be comparable to similarly titled measures of other companies. Adjusted EBITDA is not a measure of performance under IFRS and should be considered in addition to and not as a substitute for other measures of financial performance and liquidity
Safety
It is with deep regret that Harmony reports that five of its employees lost their lives in work-related incidents during the March 2021 quarter. The Company sends its deepest condolences to the families and loved ones of the colleagues who died. Zero loss of life remains the Company’s non-negotiable objective.
The Company continues to prioritise the safety of its employees. It is continuously working to avoid any work-related injuries and continue its safety journey as it focuses on a humanistic transformation at all its operations. Through passionate leadership, resilient management systems, effective risk management and organisational learning, it is developing an engaged and interdependent workforce who display a proactive relationship to safety.
Several notable milestones were recorded during the quarter:
•Kalgold achieved 3 750 000 fatality-free shifts
•Moab Khotsong, Doornkop and Mponeng mines each achieved 1 million fatality-free shifts
•Joel mine achieved 1 421 684 fatality-free shifts
Also see the Company’s website at www.harmony.co.za/sustainability/social/safety-health for more information on its safety initiatives and the incidents reported during the quarter.
Harmony remains committed to preventing the spread of COVID-19 and mitigating the impact thereof, while still prioritising other healthcare initiatives aimed at curbing occupational diseases and improving the wellness of its employees.
ESG
Harmony continues to place a strong focus on its ESG initiatives as good corporate citizens. As a result, the Company is pleased to announce that MSCI has upgraded Harmony from a ‘CCC’ to a ‘B’ rating in the March 2021 quarter, while it was once again included in the Bloomberg Gender-Equality index for the third consecutive year. The latest FTSE4Good ESG ratings revealed improved scores for Harmony, with the company outperforming both the sub-sector average for gold mining companies and the industry average for basic materials. These improved ratings are testimony to its embedded approach to ESG and sustainability throughout its entire business. In addition to its continuous environmental and social obligations, the importance of governance cannot be overemphasised. Harmony remains committed to operating ethically and honestly while mining in a sustainable and impactful manner.
Harmony’s virtual ESG Investor Day will be held on 22 June 2021, where the Company plans to share more on its ESG initiatives with the market. Details will be shared on the Company’s website in due course.
Production
Operating free cash flow for the nine months ended 31 March 2021 (“the reporting period”) was up 78% to R5 297 million (US$335 million) compared to R2 970 million (US$199 million) for the previous nine-month period ended 31 March 2020 (“the comparable period”).
Operating free cash flow margin increased from 13% in the previous comparable period to 18% for the reporting period on the back of:
•a 2.6% increase in underground grade to 5.54g/t (5.40g/t at the end of March 2020)
•a 23% increase in gold price received to R868 964/kg from R704 965/kg in the previous reporting period ended 31 March 2020
•US$/oz gold price received increased by 16% from US$1 470/oz to US$1 708/oz
•the Rand weakened by 6% against the US$ from R14.91 to R15.82 year-on-year
•a 13.5% increase in production from 30 814kg (990 691oz) to 34 969kg (1 124 274oz)
The sequential increase year-on-year in production and free cash flow was largely due to the successful integration of Mponeng and related assets into its portfolio, as well as a higher R/kg gold price received.
Despite COVID-19 and the seasonal challenges typically faced in the third quarter of FY21, the Company managed to catch up on its development and production in the third quarter of FY21.
Quarter-on-quarter, production declined 12.2% from 13 425kg (431 622oz) to 11 786kg (378 927oz). The decline in production was predominantly as a result of an uncharacteristically slow start-up in January 2021 after the December 2020 break. COVID-19 compliance rules further exacerbated the seasonal slow return post the holidays – especially as it relates to employees returning through the South African borders and COVID-19 hotspot areas.
At its Papua New Guinea operations, Hidden Valley was impacted by COVID-19 and geotechnical stability of the eastern wall of the stage 6 pit during the March 2021 quarter, which resulted in a decrease in the grade of the ore. Despite this, Hidden Valley still managed a 15% increase in average recovered grade to 1.41g/t in Q3 FY21 from 1.23g/t in Q2 FY21, which resulted in a 16% increase in quarter-on-quarter gold production to 1 351kg (43 436oz) from 1 165kg (37 456oz).
Despite an increase in positive COVID-19 cases in Papua New Guinea, gold production at Hidden Valley has continued and contingencies are in place which seek to minimise disruption to the operation in the event of a significant number of operational employees and/or contractors contracting the virus. Production at the Hidden Valley mine in the June 2021 quarter will be impacted by major fixed plant maintenance and repairs with a mill re-lining taking place as well as a belt splice repair on the overland conveyor.
All-in sustaining cost (“AISC”)
Harmony’s AISC for the reporting period increased by almost 16% to R720 572/kg (US$1 416/oz) from R622 458/kg (US$1 298/oz). The primary drivers behind this increase were again royalties on the back of an increase in the Rand gold price and COVID-19 related costs, while the Company has also seen an increase in costs relating to safety as it continues on its safety transformation journey. The Company’s safety costs were further impacted by the increase in steel prices as it maintains and continues to install safety steel netting at all of its mines to eliminate incidents due to seismicity and fall of ground. Target 1 experienced pillar failure and backfill dilution during the March 2021 quarter, which further weighed on the AISC for the reporting period.
Wafi-Golpu project
In December 2020, following a rigorous environmental impact assessment, the Papua New Guinea Conservation and Environment Protection Authority approved, and the Director of Environment issued the Environment Permit for the Wafi-Golpu Project. The Environment Permit is required under the Papua New Guinea Environment Act and is a prerequisite for the grant of a Special Mining Lease under the Mining Act 1992.
Subsequently, the Governor of Morobe province and the Morobe Provincial Government have commenced legal proceedings in the National Court in Papua New Guinea seeking judicial review of the decision to issue the Environmental Permit. The participants in the Wafi-Golpu Joint Venture (WGJV) are not defendants to the proceedings.
The National Court is yet to hear and determine this judicial review application. At this stage, project and permitting activities can still progress. Harmony, together with its WGJV partner, Newcrest Mining Limited, looks forward to re-engaging with the State of Papua New Guinea and progressing discussions on the Special Mining Lease for the Wafi-Golpu Project.
The Papua New Guinea government has indicated that Wafi-Golpu is a project of national importance with the permitting thereof a priority.
Hedging
The Company’s hedging strategy is proving to be successful as its approach to hedge more selectively supports stronger margins and cash flows. The average forward Rand gold price on the hedge book has now increased from R892 000/kg (US$1 889/oz) as at 31 December 2020 to R936 000/kg (US$1 971/oz) as at 31 March 2021. Harmony will only hedge when it is certain that it can achieve a minimum margin of 25% above AISC and inflation. The Company will not hedge if it is not able to lock-in the required margin. The improved performance of its hedge book is also on the back of a weaker Rand gold price with approximately 15% of its gold production currently hedged.
Hedge position as at 31 March 2021
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| | FY2021 | FY2022 | FY2023 | TOTAL |
| | Q4 | Q1 | Q2 | Q3 | Q4 | Q1 | Q2 | Q3 |
| Rand gold | | | | | | | | | | |
| Forward contracts | koz | 86 | 79 | 72 | 63 | 52 | 38 | 5 | – | 395 |
| R’000/kg | 790 | 863 | 933 | 1 022 | | 1 070 | | 1 084 | | 1 025 | | – | 936 |
| Dollar gold | | | | | | | | | | |
| Forward contracts | koz | 12 | 12 | 12 | 11 | 10 | 9 | 6 | – | 72 |
| $/oz | 1 521 | | 1 561 | | 1 606 | | 1 723 | | 1 802 | | 1 911 | | 1 904 | | – | 1 692 | |
| Total gold | koz | 98 | 91 | 84 | 74 | 62 | 47 | 11 | – | 467 |
| Currency hedges | | | | | | | | | | |
| Rand dollar | | | | | | | | | | |
| Zero cost collars | $m | 61 | 47 | 42 | 27 | – | – | – | – | 177 |
| Floor R/$ | 15.91 | 16.32 | 16.93 | 17.99 | – | – | – | – | 16.56 |
| Cap R/$ | 17.28 | 17.90 | 18.54 | 19.65 | – | – | – | – | 18.09 |
| Forward contracts | $m | 12 | 9 | 9 | 8 | – | – | – | – | 38 |
| R/$ | 16.93 | 18.18 | 18.41 | 18.71 | – | – | – | – | 17.95 |
| Total dollar | $m | 73 | 56 | 51 | 35 | – | – | – | – | 215 |
| Dollar silver | | | | | | | | | | |
| Zero cost collars | koz | 375 | 365 | 335 | 315 | 285 | 245 | 165 | 30 | 2 115 | |
| Floor $/oz | 18.42 | 18.61 | 19.52 | 20.05 | 20.43 | 24.07 | 26.10 | 26.38 | 20.51 |
| Cap $/oz | 20.02 | 20.26 | 21.35 | 22.05 | 22.49 | 26.57 | 28.98 | 29.88 | 22.50 |
Annual production, cost and grade guidance
As a result of the major repair work and fixed plant maintenance at Hidden Valley which occurred in the beginning of Q4 FY21, the Company feels it prudent to make a small adjustment to its production guidance to 1.50Moz to 1.55Moz from its previous production guidance of 1.56Moz to 1.6Moz for FY21.
Harmony remains confident that it will achieve its underground grade guidance of 5.47g/t to 5.64g/t and its overall cost guidance of R700 000/kg to R720 000/kg for FY21.
Balance sheet and liquidity
Net debt/EBITDA remained flat quarter-on-quarter at 0.1 times. Harmony repaid debt amounting to R833 million (US$56 million) during the March 2021 quarter. Net debt increased by R373 million (US$24 million) to R953 million (US$64 million) at 31 March 2021 (R580 million (US$40 million) at 31 December 2020) as a result of lower operating cash flow received due to the lower Rand gold price and seasonally lower production exacerbated by compliance with COVID-19 requirements, which impacted production and thus cash flow.
OPERATING RESULTS – NINE MONTHS ON NINE MONTHS (RAND/METRIC)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Nine
months
ended | SOUTH AFRICA | SOUTH AFRICA | Hidden
Valley | TOTAL
HARMONY |
| UNDERGROUND PRODUCTION | | TOTAL
SOUTH
AFRICA |
Moab
Khotsong | Tshepong operations | Mponeng | Kusasalethu | Doornkop | Bambanani | Masimong | Target 1 | Joel | Unisel | Total Underground | Mine Waste Solutions | Dumps | Phoenix | Central plant reclamation | Kalgold | Total Surface |
| Ore milled | – t'000 | Mar-21 | 656 | 1 123 | 442 | 538 | 624 | 167 | 383 | 371 | 257 | 57 | 4 618 | 11 211 | 7 193 | 4 646 | 3 012 | 1 121 | 27 183 | 31 801 | 2 750 | 34 551 |
| Mar-20 | 644 | 1 211 | — | 497 | 561 | 171 | 431 | 445 | 306 | 192 | 4 458 | — | 2 946 | 4 711 | 3 005 | 1 175 | 11 837 | 16 295 | 2 936 | 19 231 |
| Yield | – g/tonne | Mar-21 | 8.36 | 4.77 | 7.83 | 5.75 | 4.27 | 8.84 | 3.97 | 3.38 | 3.98 | 4.33 | 5.54 | 0.122 | 0.373 | 0.126 | 0.141 | 0.74 | 0.22 | 0.99 | 1.27 | 1.01 |
| Mar-20 | 8.77 | 5.10 | — | 4.83 | 4.34 | 10.68 | 4.06 | 4.02 | 3.87 | 4.43 | 5.40 | — | 0.363 | 0.131 | 0.160 | 0.79 | 0.26 | 1.67 | 1.25 | 1.60 |
| Gold produced | – kg | Mar-21 | 5 486 | 5 358 | 3 459 | 3 095 | 2 663 | 1 477 | 1 520 | 1 255 | 1 022 | 247 | 25 582 | 1 372 | 2 681 | 587 | 424 | 824 | 5 888 | 31 470 | 3 499 | 34 969 |
| Mar-20 | 5 646 | 6 180 | — | 2 400 | 2 435 | 1 827 | 1 751 | 1 789 | 1 185 | 851 | 24 064 | — | 1 068 | 618 | 480 | 924 | 3 090 | 27 154 | 3 660 | 30 814 |
| Gold sold | – kg | Mar-21 | 5 461 | 5 262 | 3 250 | 3 069 | 2 630 | 1 453 | 1 494 | 1 274 | 1 005 | 242 | 25 140 | 1 340 | 2 623 | 580 | 426 | 827 | 5 796 | 30 936 | 3 513 | 34 449 |
| Mar-20 | 5 875 | 6 268 | — | 2 501 | 2 492 | 1 852 | 1 775 | 1 813 | 1 202 | 861 | 24 639 | — | 1 091 | 628 | 483 | 930 | 3 132 | 27 771 | 3 798 | 31 569 |
| Gold price received | – R/kg | Mar-21 | 868 317 | 862 411 | 920 517 | 870 183 | 874 219 | 873 290 | 826 924 | 890 027 | 867 458 | 925 979 | 874 123 | 747 663 | 887 894 | 806 409 | 869 277 | 878 695 | 844 639 | 868 599 | 872 186 | 868 964 |
| Mar-20 | 711 606 | 708 239 | — | 710 827 | 714 900 | 709 628 | 676 132 | 672 331 | 707 239 | 676 473 | 703 969 | — | 715 927 | 685 495 | 710 725 | 709 814 | 707 208 | 704 334 | 709 583 | 704 965 |
Gold revenue1 | (R'000) | Mar-21 | 4 741 880 | 4 538 005 | 2 991 680 | 2 670 593 | 2 299 195 | 1 268 890 | 1 235 425 | 1 133 894 | 871 795 | 224 087 | 21 975 444 | 1 232 882 | 2 328 947 | 467 717 | 370 312 | 726 681 | 5 126 539 | 27 101 983 | 3 063 988 | 30 165 971 |
| Mar-20 | 4 180 686 | 4 439 241 | — | 1 777 779 | 1 781 530 | 1 314 231 | 1 200 135 | 1 218 936 | 850 101 | 582 443 | 17 345 082 | — | 781 076 | 430 491 | 343 280 | 660 127 | 2 214 974 | 19 560 056 | 2 694 998 | 22 255 054 |
| Cash operating cost (net of by-product credits) | (R'000) | Mar-21 | 2 864 447 | 3 646 124 | 1 891 369 | 2 232 842 | 1 601 328 | 866 356 | 1 074 876 | 1 234 973 | 838 601 | 178 154 | 16 429 070 | 679 806 | 1 501 537 | 294 182 | 205 096 | 577 660 | 3 258 281 | 19 687 351 | 1 290 907 | 20 978 258 |
| Mar-20 | 2 529 544 | 3 314 981 | — | 2 008 493 | 1 319 027 | 809 489 | 984 765 | 1 155 162 | 778 436 | 462 693 | 13 362 590 | — | 545 883 | 274 416 | 172 891 | 544 369 | 1 537 559 | 14 900 149 | 1 124 400 | 16 024 549 |
| Inventory movement | (R'000) | Mar-21 | 8 075 | (74 187) | 3 675 | (15 366) | (20 782) | (15 032) | (22 126) | 6 782 | (12 864) | 3 679 | (138 146) | 90 468 | 15 342 | (5 413) | 415 | 865 | 101 677 | (36 469) | (10 398) | (46 867) |
| Mar-20 | 94 789 | 39 407 | — | 44 068 | 38 745 | 12 128 | 11 884 | 15 059 | 9 667 | 5 242 | 270 989 | — | 5 092 | 4 884 | 1 744 | 1 727 | 13 447 | 284 436 | (109) | 284 327 |
| Operating costs | (R'000) | Mar-21 | 2 872 522 | 3 571 937 | 1 895 044 | 2 217 476 | 1 580 546 | 851 324 | 1 052 750 | 1 241 755 | 825 737 | 181 833 | 16 290 924 | 770 274 | 1 516 879 | 288 769 | 205 511 | 578 525 | 3 359 958 | 19 650 882 | 1 280 509 | 20 931 391 |
| Mar-20 | 2 624 333 | 3 354 388 | — | 2 052 561 | 1 357 772 | 821 617 | 996 649 | 1 170 221 | 788 103 | 467 935 | 13 633 579 | — | 550 975 | 279 300 | 174 635 | 546 096 | 1 551 006 | 15 184 585 | 1 124 291 | 16 308 876 |
| Production profit | (R'000) | Mar-21 | 1 869 358 | 966 068 | 1 096 636 | 453 117 | 718 649 | 417 566 | 182 675 | (107 861) | 46 058 | 42 254 | 5 684 520 | 462 608 | 812 068 | 178 948 | 164 801 | 148 156 | 1 766 581 | 7 451 101 | 1 783 479 | 9 234 580 |
| Mar-20 | 1 556 353 | 1 084 853 | — | (274 782) | 423 758 | 492 614 | 203 486 | 48 715 | 61 998 | 114 508 | 3 711 503 | — | 230 101 | 151 191 | 168 645 | 114 031 | 663 968 | 4 375 471 | 1 570 707 | 5 946 178 |
| Capital expenditure | (R'000) | Mar-21 | 457 707 | 769 822 | 343 844 | 147 212 | 316 598 | 48 812 | 17 005 | 274 479 | 128 354 | — | 2 503 833 | 49 580 | 30 463 | 1 163 | 10 591 | 144 501 | 236 298 | 2 740 131 | 899 463 | 3 639 594 |
| Mar-20 | 456 406 | 842 486 | — | 170 902 | 236 849 | 42 011 | 20 384 | 282 625 | 134 700 | 6 071 | 2 192 434 | — | 1 359 | 3 210 | 5 272 | 46 023 | 55 864 | 2 248 298 | 845 000 | 3 093 298 |
| Cash operating costs | – R/kg | Mar-21 | 522 138 | 680 501 | 546 796 | 721 435 | 601 325 | 586 565 | 707 155 | 984 042 | 820 549 | 721 271 | 642 212 | 495 485 | 560 066 | 501 162 | 483 717 | 701 044 | 553 377 | 625 591 | 368 936 | 599 910 |
| Mar-20 | 448 024 | 536 405 | — | 836 872 | 541 695 | 443 070 | 562 401 | 645 703 | 656 908 | 543 705 | 555 294 | — | 511 126 | 444 039 | 360 190 | 589 144 | 497 592 | 548 728 | 307 213 | 520 041 |
| Cash operating costs | – R/tonne | Mar-21 | 4 367 | 3 247 | 4 279 | 4 150 | 2 566 | 5 188 | 2 806 | 3 329 | 3 263 | 3 126 | 3 558 | 61 | 209 | 63 | 68 | 515 | 120 | 619 | 469 | 607 |
| Mar-20 | 3 928 | 2 737 | — | 4 041 | 2 351 | 4 734 | 2 285 | 2 596 | 2 544 | 2 410 | 2 997 | — | 185 | 58 | 58 | 463 | 130 | 914 | 383 | 833 |
Cash operating cost
and capital | – R/kg | Mar-21 | 605 569 | 824 178 | 646 202 | 769 000 | 720 213 | 619 613 | 718 343 | 1 202 751 | 946 140 | 721 271 | 740 087 | 531 622 | 571 429 | 503 143 | 508 696 | 876 409 | 593 509 | 712 662 | 625 999 | 703 991 |
| Mar-20 | 528 861 | 672 729 | — | 908 081 | 638 963 | 466 065 | 574 043 | 803 682 | 770 579 | 550 839 | 646 402 | — | 512 399 | 449 233 | 371 173 | 638 952 | 515 671 | 631 526 | 538 087 | 620 427 |
| All-in sustaining cost | – R/kg | Mar-21 | 604 840 | 828 079 | 701 250 | 788 756 | 682 872 | 638 621 | 745 626 | 1 164 805 | 966 315 | 782 126 | 749 497 | 622 149 | 589 913 | 500 945 | 507 282 | 894 631 | 625 868 | 726 100 | 671 901 | 720 572 |
| Mar-20 | 523 449 | 674 655 | — | 914 614 | 631 683 | 484 252 | 592 811 | 786 269 | 767 403 | 569 317 | 647 461 | — | 506 264 | 449 857 | 369 068 | 652 848 | 517 322 | 632 406 | 549 724 | 622 458 |
Operating free cash flow margin2 | % | Mar-21 | 30 | % | 3 | % | 25 | % | 11 | % | 17 | % | 28 | % | 12 | % | (33 | %) | (11 | %) | 20 | % | 14 | % | 22 | % | 34 | % | 37 | % | 42 | % | 0 | % | 27 | % | 16 | % | 28 | % | 18 | % |
| Mar-20 | 29 | % | 6 | % | 0 | % | (23 | %) | 13 | % | 35 | % | 16 | % | (18 | %) | (7 | %) | 20 | % | 10 | % | 0 | % | 30 | % | 36 | % | 48 | % | 11 | % | 28 | % | 12 | % | 21 | % | 13 | % |
| | |
¹ Includes a non-cash consideration to Franco-Nevada (Mar-21: R231.013m, Mar-20: R0m), excluded from the gold price calculation
² Excludes run-of-mine costs for Kalgold (Mar-21: -R2.703m, Mar-20: R0.982m) and Hidden Valley (Mar-21: -R16.974m, Mar-20: -R167.966m) |
|
OPERATING RESULTS – NINE MONTHS ON NINE MONTHS (US$/IMPERIAL)
| | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | |
| Nine
months
ended | SOUTH AFRICA | SOUTH AFRICA | Hidden
Valley | TOTAL
HARMONY |
| UNDERGROUND PRODUCTION | SURFACE PRODUCTION | TOTAL
SOUTH
AFRICA |
Moab
Khotsong | Tshepong operations | Mponeng | Kusasalethu | Doornkop | Bambanani | Masimong | Target 1 | Joel | Unisel | Total Underground | Mine Waste Solutions | Dumps | Phoenix | Central plant reclamation | Kalgold | Total Surface |
| Ore milled | - t'000 | Mar-21 | 723 | 1 238 | 487 | 593 | 688 | 184 | 423 | 408 | 284 | 63 | 5 091 | 12 362 | 7 932 | 5 124 | 3 322 | 1 236 | 29 976 | 35 067 | 3 033 | 38 100 |
| Mar-20 | 710 | 1 335 | — | 548 | 618 | 189 | 475 | 490 | 337 | 212 | 4 914 | — | 3 249 | 5 194 | 3 314 | 1 296 | 13 053 | 17 967 | 3 237 | 21 204 |
| Yield | - oz/ton | Mar-21 | 0.244 | 0.139 | 0.228 | 0.168 | 0.124 | 0.258 | 0.116 | 0.099 | 0.116 | 0.126 | 0.162 | 0.004 | 0.011 | 0.004 | 0.004 | 0.021 | 0.006 | 0.029 | 0.037 | 0.030 |
| Mar-20 | 0.256 | 0.149 | — | 0.141 | 0.127 | 0.311 | 0.119 | 0.117 | 0.113 | 0.129 | 0.157 | — | 0.011 | 0.004 | 0.005 | 0.023 | 0.008 | 0.049 | 0.036 | 0.047 |
| Gold produced | - oz | Mar-21 | 176 378 | 172 263 | 111 209 | 99 506 | 85 617 | 47 486 | 48 869 | 40 348 | 32 858 | 7 941 | 822 475 | 44 110 | 86 196 | 18 873 | 13 632 | 26 492 | 189 303 | 1 011 778 | 112 496 | 1 124 274 |
| Mar-20 | 181 523 | 198 691 | — | 77 161 | 78 287 | 58 739 | 56 296 | 57 517 | 38 099 | 27 361 | 773 674 | — | 34 337 | 19 869 | 15 432 | 29 707 | 99 345 | 873 019 | 117 672 | 990 691 |
| Gold sold | - oz | Mar-21 | 175 575 | 169 177 | 104 490 | 98 670 | 84 556 | 46 715 | 48 033 | 40 960 | 32 311 | 7 780 | 808 267 | 43 082 | 84 331 | 18 648 | 13 696 | 26 589 | 186 346 | 994 613 | 112 945 | 1 107 558 |
| Mar-20 | 188 885 | 201 520 | — | 80 409 | 80 119 | 59 543 | 57 067 | 58 289 | 38 645 | 27 682 | 792 159 | — | 35 077 | 20 190 | 15 528 | 29 901 | 100 696 | 892 855 | 122 108 | 1 014 963 |
| Gold price received | - $/oz | Mar-21 | 1 707 | 1 695 | 1 809 | 1 710 | 1 718 | 1 717 | 1 625 | 1 749 | 1 705 | 1 820 | 1 718 | 1 470 | 1 745 | 1 585 | 1 709 | 1 727 | 1 660 | 1 707 | 1 714 | 1 708 |
| Mar-20 | 1 484 | 1 477 | — | 1 483 | 1 491 | 1 480 | 1 410 | 1 402 | 1 475 | 1 411 | 1 468 | — | 1 493 | 1 430 | 1 482 | 1 480 | 1 475 | 1 469 | 1 480 | 1 470 |
| Gold revenue¹ | ($'000) | Mar-21 | 299 668 | 286 784 | 189 062 | 168 771 | 145 300 | 80 189 | 78 074 | 71 658 | 55 094 | 14 161 | 1 388 761 | 77 913 | 147 180 | 29 558 | 23 402 | 45 923 | 323 976 | 1 712 737 | 193 632 | 1 906 369 |
| Mar-20 | 280 350 | 297 688 | — | 119 215 | 119 466 | 88 130 | 80 479 | 81 740 | 57 006 | 39 058 | 1 163 132 | — | 52 378 | 28 868 | 23 020 | 44 267 | 148 533 | 1 311 665 | 180 722 | 1 492 387 |
| Cash operating cost (net of by-product credits) | ($'000) | Mar-21 | 181 021 | 230 420 | 119 527 | 141 107 | 101 197 | 54 750 | 67 928 | 78 045 | 52 996 | 11 259 | 1 038 250 | 42 961 | 94 891 | 18 591 | 12 961 | 36 506 | 205 910 | 1 244 160 | 81 580 | 1 325 740 |
| Mar-20 | 169 627 | 222 297 | — | 134 686 | 88 452 | 54 283 | 66 037 | 77 463 | 52 201 | 31 027 | 896 073 | — | 36 606 | 18 402 | 11 594 | 36 504 | 103 106 | 999 179 | 75 400 | 1 074 579 |
| Inventory movement | ($'000) | Mar-21 | 510 | (4 688) | 232 | (971) | (1 313) | (950) | (1 398) | 429 | (813) | 232 | (8 730) | 5 717 | 970 | (342) | 26 | 55 | 6 426 | (2 304) | (657) | (2 961) |
| Mar-20 | 6 356 | 2 643 | — | 2 955 | 2 598 | 813 | 797 | 1 010 | 648 | 352 | 18 172 | — | 341 | 328 | 117 | 116 | 902 | 19 074 | (7) | 19 067 |
| Operating costs | ($'000) | Mar-21 | 181 531 | 225 732 | 119 759 | 140 136 | 99 884 | 53 800 | 66 530 | 78 474 | 52 183 | 11 491 | 1 029 520 | 48 678 | 95 861 | 18 249 | 12 987 | 36 561 | 212 336 | 1 241 856 | 80 923 | 1 322 779 |
| Mar-20 | 175 983 | 224 940 | — | 137 641 | 91 050 | 55 096 | 66 834 | 78 473 | 52 849 | 31 379 | 914 245 | — | 36 947 | 18 730 | 11 711 | 36 620 | 104 008 | 1 018 253 | 75 393 | 1 093 646 |
| Production profit | ($'000) | Mar-21 | 118 137 | 61 052 | 69 303 | 28 635 | 45 416 | 26 389 | 11 544 | (6 816) | 2 911 | 2 670 | 359 241 | 29 235 | 51 319 | 11 309 | 10 415 | 9 362 | 111 640 | 470 881 | 112 709 | 583 590 |
| Mar-20 | 104 367 | 72 748 | — | (18 426) | 28 416 | 33 034 | 13 645 | 3 267 | 4 157 | 7 679 | 248 887 | — | 15 431 | 10 138 | 11 309 | 7 647 | 44 525 | 293 412 | 105 329 | 398 741 |
| Capital expenditure | ($'000) | Mar-21 | 28 925 | 48 650 | 21 730 | 9 303 | 20 008 | 3 085 | 1 075 | 17 346 | 8 111 | — | 158 233 | 3 133 | 1 925 | 73 | 669 | 9 132 | 14 932 | 173 165 | 56 842 | 230 007 |
| Mar-20 | 30 606 | 56 496 | — | 11 460 | 15 883 | 2 817 | 1 367 | 18 952 | 9 033 | 407 | 147 021 | — | 91 | 215 | 354 | 3 086 | 3 746 | 150 767 | 56 664 | 207 431 |
| Cash operating costs | - $/oz | Mar-21 | 1 026 | 1 338 | 1 075 | 1 418 | 1 182 | 1 153 | 1 390 | 1 934 | 1 613 | 1 418 | 1 262 | 974 | 1 101 | 985 | 951 | 1 378 | 1 088 | 1 230 | 725 | 1 179 |
| Mar-20 | 934 | 1 119 | — | 1 746 | 1 130 | 924 | 1 173 | 1 347 | 1 370 | 1 134 | 1 158 | — | 1 066 | 926 | 751 | 1 229 | 1 038 | 1 145 | 641 | 1 085 |
| Cash operating costs | - $/t | Mar-21 | 250 | 186 | 245 | 238 | 147 | 298 | 161 | 191 | 187 | 179 | 204 | 3 | 12 | 4 | 4 | 30 | 7 | 35 | 27 | 35 |
| Mar-20 | 239 | 167 | — | 246 | 143 | 287 | 139 | 158 | 155 | 146 | 182 | — | 11 | 4 | 3 | 28 | 8 | 56 | 23 | 51 |
Cash operating cost
and Capital | - $/oz | Mar-21 | 1 190 | 1 620 | 1 270 | 1 512 | 1 416 | 1 218 | 1 412 | 2 364 | 1 860 | 1 418 | 1 455 | 1 045 | 1 123 | 989 | 1 000 | 1 723 | 1 167 | 1 401 | 1 230 | 1 384 |
| Mar-20 | 1 103 | 1 403 | — | 1 894 | 1 333 | 972 | 1 197 | 1 676 | 1 607 | 1 149 | 1 348 | — | 1 069 | 937 | 774 | 1 333 | 1 076 | 1 317 | 1 122 | 1 294 |
| All-in sustaining cost | - $/oz | Mar-21 | 1 189 | 1 628 | 1 378 | 1 550 | 1 342 | 1 255 | 1 466 | 2 290 | 1 899 | 1 537 | 1 473 | 1 223 | 1 160 | 985 | 997 | 1 758 | 1 230 | 1 427 | 1 321 | 1 416 |
| Mar-20 | 1 092 | 1 407 | — | 1 908 | 1 318 | 1 010 | 1 236 | 1 640 | 1 601 | 1 187 | 1 350 | — | 1 056 | 938 | 770 | 1 362 | 1 079 | 1 319 | 1 147 | 1 298 |
| Operating free cash flow margin² | % | Mar-21 | 30 | % | 3 | % | 25 | % | 11 | % | 17 | % | 28 | % | 12 | % | (33 | %) | (11 | %) | 20 | % | 14 | % | 22 | % | 34 | % | 37 | % | 42 | % | 0 | % | 27 | % | 16 | % | 28 | % | 18 | % |
| Mar-20 | 29 | % | 6 | % | 0 | % | (23 | %) | 13 | % | 35 | % | 16 | % | (18 | %) | (7 | %) | 20 | % | 10 | % | 0 | % | 30 | % | 36 | % | 48 | % | 11 | % | 28 | % | 12 | % | 21 | % | 13 | % |
| | |
¹ Includes a non-cash consideration to Franco-Nevada (Mar-21: US$14.599m, Mar-20: US$0.m), excluded from the gold price calculation
² Excludes run-of-mine costs for Kalgold (Mar-21: -US$0.168m, Mar-20: US$0.054m) and Hidden Valley (Mar-21: -US$0.574m, Mar-20: -US$11.477m) |
| | |
| HARMONY GOLD MINING COMPANY LIMITED |
Harmony Gold Mining Company Limited was incorporated and registered as a public company in South Africa on 25 August 1950. Registration number: 1950/038232/06 |
| CORPORATE OFFICE |
Randfontein Office Park PO Box 2, Randfontein, 1760, South Africa Corner Main Reef Road and Ward Avenue Randfontein, 1759, South Africa Telephone: +27 11 411 2000 Website: www.harmony.co.za |
| DIRECTORS |
Dr PT Motsepe* (chairman), JM Motloba* (deputy chairman), M Msimang*^ (lead independent director), PW Steenkamp (chief executive officer), BP Lekubo (financial director), HE Mashego (executive director) JA Chissano*^#, FFT De Buck*^, Dr DSS Lushaba*^, KT Nondumo*^, VP Pillay*^, GR Sibiya*^, P Turner*^, JL Wetton*^, AJ Wilkens* * Non-executive ^ Independent # Mozambican |
| INVESTOR RELATIONS |
E-mail: HarmonyIR@harmony.co.za Telephone: +27 11 411 2314 or +27 82 759 1775 Website: www.harmony.co.za |
| COMPANY SECRETARIAT |
Telephone: +27 11 411 2359 E-mail: companysecretariat@harmony.co.za |
| TRANSFER SECRETARIES |
JSE Investor Services (Proprietary) Limited (Registration number 2000/007239/07) 19 Ameshoff Street, 13th Floor, Hollard Building, Braamfontein PO Box 4844, Johannesburg, 2000, South Africa Telephone: +27 861 546 572 E-mail: info@jseinvestorservices.co.za Fax: +27 86 674 4381 |
| ADR* DEPOSITARY |
Deutsche Bank Trust Company Americas c/o American Stock Transfer and Trust Company Operations Centre, 6201 15th Avenue, Brooklyn, NY 11219, United States E-mail queries: db@astfinancial.com Toll free (within the US): +1-886-249-2593 Int: +1 718 921 8137 Fax: +1 718 921 8334 *ADR: American Depositary Receipts |
| SPONSOR |
JP Morgan Equities South Africa (Proprietary) Limited 1 Fricker Road, corner Hurlingham Road, Illovo, Johannesburg, 2196 Private Bag X9936, Sandton, 2146 Telephone: +27 11 507 0300 Fax: +27 11 507 0503 |
| TRADING SYMBOLS |
| ISIN: ZAE 000015228 |
HARMONY’S ANNUAL REPORTS
Harmony���s Integrated Annual Report, and its annual report filed on a Form 20F with the United States’ Securities and Exchange Commission for the financial year ended 30 June 2020, are available on our website (www.harmony.co.za/invest).
FORWARD-LOOKING STATEMENTS
This presentation contains forward-looking statements within the meaning of the safe harbour provided by Section 21E of the Exchange Act and Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), with respect to our financial condition, results of operations, business strategies, operating efficiencies, competitive positions, growth opportunities for existing services, plans and objectives of management, markets for stock and other matters. These forward-looking statements, including, among others, those relating to our future business prospects, revenues, and the potential benefit of acquisitions (including statements regarding growth and cost savings) wherever they may occur in this presentation and the exhibits to this presentation, are necessarily estimates reflecting the best judgment of our senior management and involve a number of risks and uncertainties that could cause actual results to differ materially from those suggested by the forward-looking statements. As a consequence, these forward-looking statements should be considered in light of various important factors, including those set forth in our Integrated Annual Report. Important factors that could cause actual results to differ materially from estimates or projections contained in the forward-looking statements include, without limitation: overall economic and business conditions in South Africa, Papua New Guinea, Australia and elsewhere; impact of COVID-19 on our operational and financial estimates and results; estimates of future earnings, and the sensitivity of earnings to the prices of gold and other metals; estimates of future production and sales for gold and other metals; estimates of future cash costs; estimates of future cash flows, and the sensitivity of cash flows to the prices of gold and other metals; estimates of provision for silicosis settlement; estimates of future tax liabilities under the Carbon Tax Act; statements regarding future debt repayments; estimates of future capital expenditures; the success of our business strategy, exploration and development activities and other initiatives; future financial position, plans, strategies, objectives, capital expenditures, projected costs and anticipated cost savings and financing plans; estimates of reserves statements regarding future exploration results and the replacement of reserves; the ability to achieve anticipated efficiencies and other cost savings in connection with past and future acquisitions, as well as at existing operations; fluctuations in the market price of gold; the occurrence of hazards associated with underground and surface gold mining; the occurrence of labour disruptions related to industrial action or health and safety incidents; power cost increases as well as power stoppages, fluctuations and usage constraints; supply chain shortages and increases in the prices of production imports and the availability, terms and deployment of capital; our ability to hire and retain senior management, sufficiently technically-skilled employees, as well as our ability to achieve sufficient representation of historically disadvantaged persons in management positions; our ability to comply with requirements that we operate in a sustainable manner and provide benefits to affected communities; potential liabilities related to occupational health diseases; changes in government regulation and the political environment, particularly tax and royalties, mining rights, health, safety, environmental regulation and business ownership including any interpretation thereof; court decisions affecting the mining industry, including, without limitation, regarding the interpretation of mining rights; our ability to protect our information technology and communication systems and the personal data we retain; risks related to the failure of internal controls; the outcome of pending or future litigation or regulatory proceedings; fluctuations in exchange rates and currency devaluations and other macroeconomic monetary policies; the adequacy of the Company’s insurance coverage; any further downgrade of South Africa’s credit rating and socio-economic or political instability in South Africa, Papua New Guinea and other countries in which we operate.
The foregoing factors and others described under “Risk Factors” in our Integrated Annual Report (www.harmony.co.za) and our Form 20F should not be construed as exhaustive. We undertake no obligation to update publicly or release any revisions to these forward-looking statements to reflect events or circumstances after the date of this annual report or to reflect the occurrence of unanticipated events, except as required by law. All subsequent written or oral forward-looking statements attributable to Harmony or any person acting on its behalf are qualified by the cautionary statements herein.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.
| | | | | | | | | | | | | | | | | |
| | | Harmony Gold Mining Company Limited |
| | | | | |
| Date: May 11, 2021 | By: /s/ Boipelo Lekubo |
| | | Name: Boipelo Lekubo |
| | | Title: Financial Director |
