Harmony Gold: R1.4bn write-down on Phakisa project

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HARMONY Gold was writing down R1.4 billion on part of an expansion project into unmined areas at its Phakisa operation, it said on Friday. “An updated feasibility study was recently completed on the Phakisa decline project and showed that a large amount of capital was required,” Harmony, which reports full-year results next week, said in a statement. As a result, it said it would not continue with that development and the write-down would be recorded in its full-year financial results. Harmony said this would “reduce the net profit of the company, but will not have an impact on reported cash balances and free cash flow”. Harmony has been scaling back capital expenditure in line with industry trends and said it planned “significantly lower” investment in its Wafi-Golpu mine in Papua New Guinea, which has become its flagship project. Plans unveiled in 2012 called for spending of almost $6bn (R64bn) to develop the mine which would have been shared with joint-venture partner Newcrest Mining. Shares in Harmony rose 1.19 percent to close at R34 on Friday. – Reuters

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