Harmony reports a 10% production decrease - CNBC Africa

Harmony reports a 10% production decrease


by Trust Matsilele 0

Harmony reports a 10% production decrease.

The mining company’s second quarter results for the six months ended 31 December 2014 also saw production profit of 618 million rand.

(READ MORES.Africa’s harmony gold says to cut jobs at Kusasalethu mine)

Harmony added that the group saw a headline loss of 496 million rand, due to lower production and restructuring.

“Lower gold production quarter on quarter and a lower gold price resulted in a decrease in production profit to 618 million rand in the December 2014 quarter, compared to R913 million in the previous quarter,” said the group in a statement. 

“Most of the South African operations delivered in line with their operational plans. Tshepong had an exceptional performance, beating its production plan by 16 per cent.”

The company added that, Masimong and Unisel delivered a consistent performance quarter on quarter, with Bambanani being our most profitable mine at a cash operating cost of R253 000/kg. Target 3 was placed on care and maintenance as planned.

[DATA HAR:Harmony Gold Mining Company Limited] said it recorded a fatal-free quarter in South Africa – a major achievement for a deep level underground gold mining company.

“Management and employees are commended for their efforts and commitment to achieving zero harm,” said the mining group.

Harmony also said its Hidden Valley operation contributed to the quarter's lower production, due to a fatality and a belt tear on the overland conveyor (OLC).

(READ MOREHarmony to remain competitive in tough times)

“Both resulted in production stoppages at the mine. There was no structural damage to the OLC, but belt replacement work was not completed until January 2015.”

The group expects gold production during the March 2015 quarter is expected to be higher once Kusasalethu's restructuring is finalised and Hidden Valley returns to full production, positioning our operations to benefit from higher gold prices.

The company have not been sparred by the electricity challenges facing the entire economy and says it is looking for alternative energy sources.

“We have commissioned a study to identify direct purchase opportunities from Independent Power Producers and other opportunities to source electricity outside of Eskom. The study also focuses on bringing renewable energy into our energy portfolio.”