Company announcements Home » Investors » News » Company announcements » Operational update for the nine months ended 31 March 2020 2020 2024 2023 2022 2021 2020 2019 2018 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 2004 2003 2002 Operational update for the nine months ended 31 March 2020May 06, 2020Johannesburg, South Africa. Wednesday, 6 May 2020. Harmony Gold Mining Company Limited (“Harmony” or “the Company”) is pleased to report that its operating free cash flow margin for the nine months ended 31 March 2020 more than doubled to 13% from 6% for the nine months ended 31 March 2019. This was due largely to a 21.6% increase in the average Rand gold price received for the period to R704 965/kg. Operating free cash flow increased by more than 100%, from R1.3 billion to R3.0 billion. Total gold production was 8.5% lower at 30 814kg (or 990 691oz), affected by South Africa’s COVID-19 national lockdown regulations, compliance with which resulted in six full days of operation lost at the company’s nine South African underground mines at the end of the reporting period, and loadshedding by Eskom earlier in the quarter. The average underground recovered grade was 3.6% lower at 5.40g/t, due primarily to the negative impact of Kusasalethu’s previously reported geological challenges and seismicity. Quarter on quarter, however, Kusasalethu mined above the planned grade, reporting an increase of approximately 14% to 5.08g/t, reflecting the positive impact of ongoing remedial actions to address the afore-mentioned geological challenges and seismicity. Harmony achieved a recovered grade of 5.68g/t for its underground operations for the March 2020 quarter. The grade performance at most of the South African operations was good with an overall increase of 0.37g/t or 7% quarter on quarter. Production at Hidden Valley in the March quarter was impacted by a 14-day mill stoppage in January 2020, due to a fault in the mill’s electronic management system, which has since been resolved. For the nine months, Harmony’s all-in sustaining unit costs were 14.5% higher at R622 458/kg (8.3% higher at US$1 298/oz) due to the lower production recorded. For more details contact: Marian van der Walt Executive: Corporate and Investor Relations +27 (0) 82 888 1242 (mobile) Max Manoeli Manager: Investor Relations +27 (0) 82 759 1775 JSE Sponsor: J.P. Morgan Equities South Africa Propriety Limited FORWARD LOOKING STATEMENTS This report 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 report and the exhibits, 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 this 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; estimates of future earnings, and the sensitivity of earnings to gold and other metals prices; estimates of future gold and other metals production and sales; estimates of future cash costs; estimates of future cash flows, and the sensitivity of cash flows to gold and other metals prices; estimates of provision for silicosis settlement; 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 HDSAs 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 and safety, environmental regulation and business ownership including any interpretation thereof; court decisions affecting the South African 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 any further downgrade of South Africa’s credit rating; and currency devaluations and other macroeconomic monetary policies; the adequacy of the Group’s insurance coverage; and socio-economic or political instability in South Africa, Papua New Guinea, Australia and other countries in which we operate. For a more detailed discussion of such risks and other factors (such as availability of credit or other sources of financing), see the Company’s latest Integrated Annual Report and Form 20-F which is on file with the Securities and Exchange Commission, as well as the Company’s other Securities and Exchange Commission filings. The Company undertakes no obligation to update publicly or release any revisions to these forward looking statements to reflect events or circumstances after the date of this report or to reflect the occurrence of unanticipated events, except as required by law. The foregoing factors and others described under “Risk Factors” should not be construed as exhaustive. Harmony Gold Mining Company Limited (Harmony), a world-class gold mining and exploration company, has operations and assets in South Africa and Papua New Guinea (PNG). Harmony has close to 70 years’ experience in the industry. Company assets include one open pit mine and several exploration tenements in PNG, as well as 9 underground mines and 1 open pit operation and several surface sources in South Africa. In addition, Harmony owns 50% of the significant Wafi-Golpu copper-gold project – a tier 1 asset – in a joint venture in PNG. The company’s primary stock exchange listing is on the JSE with a secondary listing on the New York Stock Exchange. The bulk of our shareholders are in South Africa and the United States. Additional information on the company is available on the corporate website, www.harmony.co.za.
