Board-Ansicht
Mix-Ansicht- Harmony steigert Gewinn um harmonische 25 % - Socrates, 05.08.2002, 19:06
Harmony steigert Gewinn um harmonische 25 %
JOHANNESBURG, Aug 5 (Reuters) - South Africa's Harmony Gold said on Monday it lifted operating profits by 25 percent in its fourth quarter, thanks to improved performance in its local mines and the inclusion of an acquisition in Australia.
Its shares rose after the country's third-largest gold producer said cash operating profit, which is revenues minus costs directly related to mining, rose to 1.068 billion rand ($103 million) in the quarter to end-June, from 851 million in the previous quarter.
Earnings per share rose four percent quarter-on-quarter to 402 cents.
Harmony boosted operating profit by cutting costs and by increasing output from its existing mines and from the takeover of Australia's Hill 50 in June.
"This was mainly due to improved operational performance by the Free State, Elandskraal and Free Gold operations and the inclusion of Hill 50 in Australia," the company said.
The two highlights picked out by analysts in what they described as solid results were lower costs and a higher dividend.
Harmony slashed working costs nine percent to 59,574 rand per kg of gold.
It declared a final dividend of 425 cents per ordinary share, which with an interim dividend of 75 cents amounted to 500 cents for the year. That was more than four times the previous year's dividend of 120 cents.
"Costs were well contained and better than anticipated, as was the dividend," said one analyst.
Its share price raced 10.1 percent or 12 rand higher to 131 rand by the close, slightly outperforming the gold index <.JGLDX> as the price of bullion rose.
The company realised a gold price of $308 an ounce for the quarter, up from $286 for the March quarter. But it said the strengthening of the rand in the period had eroded the benefits of the rise in the dollar gold price.
Chief Executive Bernard Swanepoel said on Monday he saw a lower gold price and higher costs impacting on its performance in the quarter to the end of September. Among those costs was an eight percent rise in the salary bill for miners.
"Operations are running well...it's just a matter of what happens in terms of the lower gold price," Swanepoel told an analysts' presentation.
He added he remained"fairly bullish" in the short term about the gold price:"I think the gold market fundamentals are good."
Spot gold <XAU=> was at $308.75 a troy ounce at 1330 GMT. The metal hit a 2-1/2 year high of $330 an ounce in June.
LUCKY BUY
The group boosted production by 25 percent for the year to end-June to 2.7 million ounces and said it expected production of some 3.1 million ounces in the new financial year.
Free Gold, a 50/50 joint venture with recently listed African Rainbow Gold <AODJ.J>, had bought four mines from AngloGold <ANGJ.J> last year. Swanepoel described it as"one of the luckiest acquisitions we have ever been party to".
Unlisted Free Gold's cash operating profit rose 42 percent to 569.9 million rand in the quarter to June, from 402.8 million rand in the previous quarter. It contributed 284.9 million rand in cash operating profit to Harmony.
African Rainbow Gold, known as ARMgold, is a black-controlled company, whose share price remained fairly steady in a recent sector fall-out from a draft new mining charter that aims to give blacks a bigger role in the industry.
"ARMgold's share price was almost unaffected by the fracas...and that's no coincidence," Swanepoel told journalists.
The draft mining charter, leaked to a mining website in late July, says control of all new projects must rest with new black business within 10 years.
It also suggests that up to 30 percent of equity in existing operations must be given to black-owned mining businesses before licences to mine expansion-related projects are issued.
The government has since distanced itself from the draft, saying it was not official policy and was merely the start of extensive discussion.
The leaked document, Swanepoel said, had done"real damage", and the industry would only regain foreign investor confidence"with difficulty".
"About 80 percent of our investors are off-shore. What they think of us matters," he said.
But he added:"The mining charter is a document with 90 percent good intentions but with bad quotas attached to it."
He said Harmony had no intention of quitting South Africa, but"if the cost of doing business in South Africa makes mining unprofitable, then we won't be here".
Swanepoel also announced that Harmony had invested $19 million to buy 32 percent in a small gold mine in Russia that produces an annual 150,000 ounces of the metal. He gave no further details.
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Socrates
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