Harmony Gold's Kusasalethu mine in Carletonville, to the west of Johannesburg. The group's gold output was boosted by the acquisition of the Moab Khotsong mine in North West. Photo: Supplied
DURBAN - Harmony Gold yesterday praised its recent Moab Khotsong acquisition for boosting its gold output in the four months that the mine has been part of the group.

Harmony Gold said the mine helped it to exceed its annual gold production target by 4percent for the year to end June.

The group said its output peaked at 1.228 million ounces during the period - way above the initial guidance of 1.18million ounces for the third consecutive year with all costs contained.

“The South African operations recorded a 14percent increase in gold production, of which Moab Khotsong produced 105900 ounces, contributing 10percent of the increase in SA gold production for the four months the operation has been included in Harmony’s asset portfolio,” the group said.

Harmony Gold bought Moab Khotsong, which incorporates the Great Noligwa and related infrastructure, from AngloGold Ashanti for a consideration of $300million (R4.01billion) in cash, effective at the end of February.

Harmony has operations and assets in South Africa and Papua New Guinea. The company assets include one open pit mine and several exploration tenements in PNG as well as 10 underground mines and one open pit operation and several surface sources in South Africa.

In addition, Harmony owns 50percent of the significant Wafi-Golpu copper-gold project, a tier 1 asset, in a joint venture in Papua New Guinea. Harmony’s primary listing is on the JSE, with a secondary listing on the New York Stock Exchange.

Peter Steenkamp, chief executive of Harmony, said the group managed to increase its output during the period amid difficult trading conditions. He said the miner lost lives with two workers killed following a seismic related fall at one of its mines in Welkom in the Free State in March.

“We recognise that safety requires increased attention and we are committed to continue driving a culture of safety. Safety, costs and production are the only variables that we can control, and we will build on the momentum achieved in financial year 2018,” Steenkamp said.

The group said the $200m bridge facility raised for the Moab Khotsong transaction had already been paid in full, utilising available cash resources and the proceeds received from the share placement.

At the beginning of June Harmony raised R1.05bn through the placement of 55million new ordinary shares at R19.12 a share.

Harmony has a successful hedging strategy in place and continues to lock in attractive margins and all-in sustaining cost is expected to be below guidance of R520000/kg. It expects to release its yearly results to end June on August 21.

Harmony shares rose 2.65percent on the JSE yesterday to close at R21.66.