Quarterly profit shines at Harmony Gold

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FOURTH-QUARTER profit at Harmony Gold more than doubled from the previous three months after output rose 7 percent, South Africa’s third-largest producer of the metal said yesterday.

Headline earnings were R124 million in the three months to June, compared with R52m in the previous quarter.

Costs increased 4 percent to $1 267 an ounce, compared with the current spot price of $1 313, but they fell 3.3 percent in rand terms to R435 775 a kilogram.

Harmony suspended its dividend a year ago when a plunging gold price put the firm in a loss-making position and forced it to cut costs to stay competitive. The mining house decided last week to write down the value of its Phakisa mine in the Free State by R1.4 billion after saying the expense of expanding the operation was too high.

“Our strategy is to focus on improving our margins, growing the value per share of our Papua New Guinea assets and we intend identifying acquisition opportunities outside South Africa,” chief executive Graham Briggs said.

Harmony made a net loss of R1.2bn in the quarter, mainly due to the impairment at Phakisa mine, it said.

For the full year its headline earnings a share halved to 26c.

The stock fell 1.23 percent to R33.86 yesterday. – Bloomberg

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