| KEY HIGHLIGHTS (Q1FY25 vs Q1FY24) |
| • Proactive safety strategy resulted in a loss-of-life free quarter with 5 of our 9 underground mines having achieved over 1 million loss-of-life free shifts each |
| • Harmony was awarded gold in the Water Conservation Category at the Eco-Logic Awards on 30 October 2024 for refurbishing three municipal Wastewater Treatment Plants |
| • Steady quarterly group gold production, decreasing by only 1% to 13 131kg (422 172oz) from 13 223kg (425 130oz)1 |
| • Mponeng production increased by 28% due to higher recovered grades and tonnes milled, generating operating free cash flow of R1 842 million (US$103 million) |
| • Underground recovered grades remain high at 6.32g/t from 6.29g/t, mainly due to excellent recovered grades at Mponeng and Moab Khotsong |
| • 14% increase in group all-in sustaining costs (AISC) to R963 310/kg (US$1 667/oz) from R841 436/kg (US$1 404/oz) in line with FY25 guidance |
| • 21% increase in average gold price received to R1 360 974/kg (US$2 356/oz) from R1 127 208/kg (US$1 881/oz) |
| • Group operating free cash flow2, increased by 60% to R5 179 million (US$288 million) driven by higher recovered grades and a higher average gold price received |
| • 23% increase in gold revenue to R18 125 million (US$1 009 million) from R14 781 million (US$793 million) |
| • Strong, flexible balance sheet with net cash position increasing to R6.3 billion (US$362 million) and liquidity of R15.7 billion (US$909 million) in cash and undrawn facilities |
| Harmony again delivered an exceptional first quarter through consistent operational excellence and higher recovered grades at our South African high-grade underground operations. We are pleased to report a loss-of-life-free quarter, a significant achievement for underground gold mining in South Africa, demonstrating that a safe mine is a profitable mine. Operating free cash flow generation remains strong with excellent operating free cash flow margins at our South African high-grade underground, South African surface and Hidden Valley operations. The high average rand gold price received continues to boost free cash flow generation, further strengthening our balance sheet this quarter. As a result, we are well-positioned to execute our various life-of-mine extension projects and take our transformational international copper-gold projects up the value curve. |
| We have a globally significant resource base with over 136 million ounces of Mineral Resources. This includes copper and gold. While value-accretive acquisitions are a key part of our growth strategy, internal investment and reserve conversion remain an affordable and effective way of creating value, especially at the current high gold prices. Harmony continues to demonstrate the significant value inherent in our existing portfolio. We continue investing in lower-risk, high-quality and high-margin ounces which will improve the overall profitability of our portfolio over time. |
| Harmony has a long production profile and our existing project pipeline will enable us to remain a 1.4 million ounce producer for well over 20 years. Through our various gold and copper projects, real all-in-sustaining cost (AISC) is expected to reduce in the medium to long term as the quality of our production mix improves and copper is introduced. Projects such as Eva Copper in Australia and Wafi-Golpu in Papua New Guinea will be transformational, moving Harmony significantly down the global cost curve. |
| Harmony has a strong safety and operational culture and we remain the partner of choice wherever we operate. We have invested in improving our operational flexibility, and infrastructure reliability and have a predictable and stable cost structure. The quality of our portfolio also continues to improve and our projects remain well-sequenced ensuring capital intensity remains affordable through the cycle. Through good financial discipline and applying a balanced approach to our capital allocation framework, we aim to reward our shareholders alongside our growth aspirations. Creating long-term value for our shareholders and stakeholders through operational consistency and embedded sustainability is what we call Mining with Purpose. |
| Health and Safety |
| The health and safety of our people is our main priority. The remarkable long-term improvement in our group safety performance is evidence that our various programmes and initiatives are yielding the desired results. While Harmony's long-term safety performance continues to improve, more needs to be done to ensure we achieve energy agencies such as 'slip and fall' and 'material handling'. We are working tirelessly to ensure all working environments are safe at all times while embedding a culture of safety and living the Harmony values at work and home. |
| Some of the notable achievements of this reporting period include: |
| • a loss-of-life free quarter for the group |
| • Hidden Valley has not had a loss of life since July 2015 (3 361 days) |
| • three of our South African underground operations (Masimong, Moab Khotsong and Joel) have achieved over three million loss-of-life free shifts each |
| • two of our South African underground operations (Target 1, Kusasalethu), have each achieved over one million loss-of-life-free shifts |
| Responsible stewardship |
| Harmony was awarded gold in the Water Conservation Category at the Eco-Logic Awards on 30 October 2024 in Cape Town for refurbishing three municipal Wastewater Treatment Plants (WWTPs). The Eco-Logical Award recognises organisations and individuals that positively contribute to a sustainable world. |
| We refurbished three WWTPs on behalf of the Matjhabeng, Matlosana and Merafong municipalities to increase sewage treatment capacity by around 30 million litres per day. We have invested more than R35 million in refurbishing these WWTPs and all three projects were delivered on time, on budget with zero injuries. |
| This recognition demonstrates our commitment to Mining with Purpose as we continue giving back to our host communities and creating shared value for all our stakeholders. |
| Production |
| Group gold production for the quarter remained largely flat year-on-year at 13 131kg (422 172oz) compared to 13 223kg (425 130oz) in Q1FY24. |
| • South Africa underground high-grade operations: production increased by 15% year-on-year to 4 872kg (156 639oz) from 4 234kg (136 126oz) mainly due to the ongoing outperformance at Mponeng. Production from Mponeng this quarter increased by 28% to 2 997kg (96 356oz) while production at Moab Khotsong remained steady at 1 875kg (60 283oz). Uranium is a by-product of the gold extraction process at Moab Khotsong. This quarter, uranium production decreased by 10% to 63 092kg (139 094lb) from 70 044kg |
| (154 420lb) in Q1FY24. Year-on-year, the average uranium price received increased by 39% to US$80.84/lb from US$58.21/lb, resulting in uranium revenue of R199 million (US$11 million) for the quarter. |
| • South African underground optimised operations: production decreased by 10% to 4 887kg |
| (157 121oz) from 5 448kg (175 158oz) mainly as a result of lower grades and volumes at Tshepong North and Tshepong South. A continuous drive for these mines remains footwall reduction, quality mining and mining mix from the southern panels to improve the belt grade. We have seen a significant reef recovery benefit at |
| Kusasalethu since moving the ore processing to the Mponeng plant in Q1FY22, with a cumulative benefit of 555kg (19 509oz) or approximately 43kg (1 382oz) each quarter, to date. With an overall contribution of 37% towards total production, these optimised assets play an important role in funding our growth strategy. It is therefore necessary to continue investing sustaining capital in these operations to maintain the necessary flexibility. |
| • South African surface source operations: production remained steady at 2 168kg (69 703oz) from 2 185kg (70 250oz). Mine Waste Solutions (MWS) is the largest contributor to our surface production, |
| delivering a 1% increase in production of 878kg (28 228oz) for the quarter compared to 872kg (28 035oz) in Q1FY24. All our surface retreatment operations delivered higher production volumes year-on-year. |
| Our goal of zero loss of life and eliminate significant unwanted events. The group lost time injury frequency rate (LTIFR) unfortunately regressed to 5.53 in Q1FY25 from 4.84 in Q1FY24 mainly due to an increase in lower |
| International: Hidden Valley's production decreased by 11% which was in line with its plan as recovered grades normalised after we mined through the high-grade Big Red lobe. We are progressing the Stage 7 East and West cutbacks with Stage 8 stripping also underway. Silver production from Hidden Valley decreased by 5% to 29 515kg (948 928oz) from 30 914kg (993 914oz) in Q1FY24. The average silver price received increased by 19% to R16 823/kg (US$29.21/oz) from R14 157/kg (US$23.59/oz) in Q1FY24. As a result, we generated R500 million (US$28 million) in silver revenue at Hidden Valley this quarter, an increase of 15% year-on-year. Silver grades remain high as a result of isolated areas of very high-grade silver not previously identified in the geological model. |
| For the full document click the link below: |
| Harmony Gold Mining Company Limited |
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