Cape Town - Harmony Gold [JSE:HAR] on Thursday posted an 84% increase in production profit to R1.29bn (68% to US$91m) quarter on quarter, mainly due to a 7% increase in the gold price received and supported by a 2% increase in gold production.
Better production results resulted in Harmony recording headline earnings of R74m.
The company said in a statement higher production means that Harmony’s cash flow is strengthened, its margins are growing, it is able to repay its debt and to fund Golpu.
The higher R/kg gold price is simply an added bonus, said CEO Peter Steenkamp.
Combined with a 7% increase in the average R/kg gold price received of R507 490/kg, revenue increased by 10% to R4.57bn (to $321m) during the quarter.
The company said underground grade was 7% higher, with the majority of Harmony’s operations producing higher kilograms and generating net free operational cash flow.
All-in sustaining costs for all operations decreased by 7% to R434 834/kg in the December 2015 quarter, compared to R466 061/kg in the September 2015 quarter (15% decrease to $950/oz).
Follow Fin24 on Twitter, Facebook, Google+ and Pinterest.
24.com encourages commentary submitted via MyNews24. Contributions of 200 words or more will be considered for publication.