Harmony Gold delivers a 9% increase in revenue
Thanks to record-level gold prices, group takings for the year increased to R29.24 billion
HARMONY Gold Mining Company has reported a 9 percent jump in revenue for the year to the end of June thanks to the strong gold price, which has reached record levels following the economic fallout from the Covid-19 pandemic.
Group revenue for the year increased to R29.24 billion, mainly due to the 25 percent increase in the gold price to R735 569 a kilogram from R586 653 a kilogram a year earlier.
The average gold price received was 14 percent stronger, at $1 461 (R24 358) an ounce, from $1 287 an ounce last year.
However, the increase in the gold price – both in dollar terms and in rand terms – negatively impacted the valuation of gold derivatives.
Harmony, which hedges a portion of its gold production to the gold price, said derivatives recorded a net realised negative cash flow of R1.77bn, compared with gains of R484 million a year earlier, principally due to R1.49bn in negative cash flow on rand gold derivatives.
Year-on-year total gold production fell 15 percent to 1.2 million ounces.
The group mainly attributed the lower output to electricity constraints during the third quarter, the national lockdown, and the phased recovery in South Africa in the fourth quarter.
Harmony said 29 employees had died as a result of Covid-19.
A total of 4.1 percent of Harmony’s workforce had tested positive for Covid-19; 94 percent had recovered, and 61 active cases were recorded at September 10, said the group.
Chief executive Peter Steenkamp said as the group headed into the 2021 financial year, the focus remained on the safety and health of employees.
“We are uncertain how long the world will be faced with Covid-19 and its impact on people and the economy. It has also compelled each one of us to reconsider what we value. At Harmony, it has driven home the value of all stakeholders and the need for all to be involved in finding solutions,” said Steenkamp. He said the group’s safety performance had improved, as fatalities had fallen to six in the financial year compared with 11 a year earlier.