HomeGoldHarmony revenue up and production down

Harmony revenue up and production down

No 1 Shaft at
Harmony’s Doornkop
Johannesburg, South Africa — MININGREVIEW.COM — 18 August 2008 – Harmony Gold Mining Company Limited – the fifth-largest gold producer in the world – increased operating profit and revenue in the 2008 financial year, while gold production showed a slight decline.

Announcing its financial results for the year ended 30 June 2008, the company said cash operating profit for the year had increased by 26% from R2 016 million to R2 537 million. The company’s total gold production for the quarter had shown a 13% increase from the previous quarter, but gold production for the financial year had declined slightly from 1.7Moz to 1.6Moz.

The news release added that revenue from continuing operations in the 2008 financial year was up by 14.6% from R8 037 million for the 2007 financial year to R9.210 million, on the back of an improved gold price in dollar terms of $818/oz, and a steady ZAR/US$ exchange rate of R7.26.

Chief Executive Officer Graham Briggs commented: “Stringent measures for cost containment have been implemented throughout the company, however, inflationary pressures were evident – not only in most of our consumables such as electricity, steel and fuel – but also salaries.”
Harmony reported a net loss of R245 million, compared with a net profit of R382 million for the financial year ended June 2007. “This was mainly due to non-cash item losses from the sale of Gold Fields shares amounting to R459 million; the loss from associates, primarily from Pamodzi Gold, amounting to R78 million; impairment of investments in associates (Pamodzi Gold) of R95 million; and impairment of assets totalling R318 million,” Briggs explained.

“We are pleased to announce that our positive 2007 safety performance was maintained in the 2008 financial year, and there was a remarkable 18.2% improvement in the fatality injury frequency rate on our mines,” he added.

Briggs remained positive for the financial year ahead, and explained that Harmony’s outlook would remain focused on sustainable organic growth. “We will exploit opportunities for further optimisation, improved production and production cost management, and enhanced cash flow will be used prudently to reduce our debt and finance new mine capacity and other growth initiatives,” Briggs continued.

“Harmony has been and will remain an acquisitive company should opportunities exist or rise,” he concluded, “and we will continue to look for value opportunities during 2009."