Cape Town - Harmony Gold on Tuesday said it turned a net profit of R31 million for the first quarter of the year, compared to a net loss of R91 million at the end of 2013.

The company listed earnings per share of 12 cents, and said its cash balance stood at R2 billion after net debt was reduced by 13 percent.

It recorded a five-percent increase in underground recovered grade for the first quarter - resulting in a cumulative increase of 17 percent for the past three quarters - and a three percent increase in gold production for the first nine months of the 2014 financial year.

Chief executive Graham Biggs said Harmony's revised planning strategy and focus on lower capital expenditure development should increase its margins.

“Various structural changes have been effected in Harmony which will aid in the pro-active management of unplanned events which have negatively impacted on our production.

“In parallel, our revised planning strategy will shift the focus toward de-bottlenecking and optimisation, and should also result in an increase in the company's margins.”

A production stoppage at Harmony's Doornkop mine in February due to a fire that killed nine miners, and flooding of a shaft at its Joel mine, contributed to slowing production in the first quarter. - Sapa