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Johannesburg - Harmony Gold Mining Company [JSE:HAR], South
Africa's third-largest gold producer, posted a more than three-fold increase in
quarterly earnings on Monday, beating expectations on bullion’s record run.
The average gold price in the July-September quarter was up
about 13% from the previous quarter, at just over $1 700 an ounce. In rand
terms, the gold price was up 20% because of weakness in the South African
currency.
"The increased rand/kg gold price received during the
September 2011 quarter continued to strengthen Harmony's profit levels," the
company said in a statement.
A weaker rand is a bigger benefit for Harmony than its
rivals, because about 90% of its output comes out of the ground in South Africa,
a much higher percentage than AngloGold Ashanti [JSE:ANG] and Gold Fields
[JSE:GFI].
South African miners sell gold for dollars but costs in
rand, meaning a weaker rand fattens their bottom line.
Harmony said production during the three months to the end
of September was up 0.5% to 328 162 ounces as it was hampered by a wage strike
that shut the mines for five days.
Harmony's headline earnings per share, soared to 95c in the quarter from 30c in the previous quarter,
above an average estimate of 90c in a Reuters poll of six analysts.
Harmony's share price is up 24% so far this year, outperforming the wider gold mining index on the Johannesburg bourse, which is up about 13.6%.
Harmony shares rose nearly 1% on Monday morning, outperforming a 0.8% decline in the benchmark Top 40 - (Tradeable) [JSE:J200] index.
