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Harmony Gold Mining Company Limited -Quarterly Results

Release Date: 01/08/2001 13:08:31      Code(s): HAR
Harmony Gold Mining Company Limited
Review for the quarter and year ened 30 June 2001
pushing for the exceptional total cost obsession
continuous
improvement
This review includes certain information that is based on management's
reasonable expectations and assumptions. These "forward-looking statements"
include, but are not limited to, statements regarding estimates, intentions
and beliefs, as well as anticipated future production, mine life, market
conditions and costs. While management has prepared this information using
the best of their experience and judgment, and in all good faith, there are
risks and uncertainties involved which could cause results to differ from
projections.
Cautionary Note to US Investors - The United States Securities and Exchange
Commission (the "SEC") permits mining companies, in their filings with the
SEC, to disclose only those mineral deposits that a company can economically
and legally extract or produce. We use certain terms in this quarterly
review, such as "resources", that the SEC guidelines strictly prohibit us
from including in our filings with the SEC.
Financial Highlights
- annual production growth of 32%
- successful capital raising and bond issue
- final dividend declaration of 70 cents - 120 cents for 2000/01 financial
year
- successful turnaround at Elandskraal as implementation of "Harmony Way"
continues
- demarcation of high grade resource at Stella PGM project
Key Indicators
                              30 June 2001      31 March 2001
Cash operating profit
- Rand                        191 million       141 million
- US$                         24 million        18 million
Earnings
- Rand                        40 million        71 million
- US$                         5 million         9 million
Earnings per share
- SA cents per share          37                68
- US cents per share          5                 9
                              30 June 2001      31 March 2001
Gold produced
- kg                          18 380            15 345
- oz                          590 927           493 351
Cash costs
- R/kg                        59 350            58 927
- $/oz                        230               234
"Following the successful restructuring of our balance sheet over the past
few months, your company is now well positioned as one of the leading gold
producers in the world. In our current environment of industry consolidation
and a gold price that remains under pressure, the company identified the
need to aggressively continue with its growth strategy. This will be
achieved through focus on increasing profit margins of existing operations
and identifying further South African turnaround opportunities"
Chief executive's review
Safety Report
It is with regret that I have to report the loss of life, as a result of
mine accidents, of eight employees during the fourth quarter. Five of these
employees were from our newly acquired Elandskraal operations. (A total of
26 employees were fatally injured during the course of the year, 24
underground and 2 on surface.) I wish to extend my sincere condolences to
the family, friends and colleagues of these employees.
I would like to extend my thanks and congratulations to the management and
employees of Evander 8 Shaft who attained a million fatality free shifts on
30 May 2001. They have been awarded the Mine Health and Safety Council's
prestigious `Millionaires Trophy' in recognition of their efforts.
Our key safety indicator LTIFR (lost time injury frequency rate) shows a
marginal improvement despite a period of rapid growth through acquisition.
Harmony gold mining company limited
- All safety indicators are expressed in number of incidents per 1, 000, 000
man-hours of exposure.
- Old HGM excludes Elandsrand and Deelkraal.
We remain resolute in our efforts to eradicate risk from our operations and
would like to compliment our employees on their efforts in this regard. The
creation of a healthy and safe working environment remains our highest
priority.
HIV/AIDS update
The wellbeing and good health of an ageing workforce remains a focus area
for the coming year. Harmony concurs with the Gold Fields Limited current
cost estimate of $4 per ounce of gold produced as a current cost for
HIV/Aids prevention and treatment. This is lower than previous estimates of
a $10 per ounce cost as predicted which would have materialised had the
pandemic been left unchecked.
In order to augment the impact of the company's intervention programmes a
full time medical practitioner has been appointed to enhance our post
infection programme and assist the peer educators in our prevention and
awareness campaign. The belief is held that the company's wellness programme
will assist in improving the quality of life of our employees and prolong
their productive life, thus securing income for them and retaining skills
for the company.
Strategic Overview
The company has experienced probably its most exciting year since its
independence from Randgold in 1997. During the 2000/2001 financial year the
company has delivered growth in terms of reserves, production and cash
operating profits.
Growth in production
Harmony has grown in most of its performance areas as the year on year
analysis of the last three years indicates.
OUR GROWTH STORY OVER THE LAST THREE YEARS
                             June 1999      June 2000      June 2001
Gold produced
- Kg                         39 997         50 572         66 563
- Oz                         1 285 931      1 625 925      2 140 040
Cash operating profit
- SA Rand                    390 million    461 million    659 million
- US$                        64 million     73 million     87 million
Cash operating costs
- R/Kg                       46 759         50 121         57 215
- US$/oz                     240            246            234
Our strategy enabled the company to increase its production from 1 625 925
ounces in the 1999/2000 financial year, to 2 140 040 ounces, an increase of
32% for the past financial year.
Cash operating profits increased by 43% from R461 million to R659 million
over the same period. Our strategy of acquiring loss-making, high cost
operations with turnaround potential, has however impacted on our working
cost R/kg which has increased from R50 121 /kg to R57 215 /kg. Our
relentless focus on working cost control at all our operations will impact
favourably on these costs over the next twelve months as the "Harmony Way"
is implemented at these new acquisitions.
Lower than expected recovery grades from our Free State operations accounted
for 6% of the increase in working costs per kg. The overall quality of our
assets, following these acquisitions, has however significantly improved,
which will impact favourably on the overall recovery grade of the company's
operations.
Measured in US$/oz terms the benefits of having a natural currency hedge is
evident. The adverse impact of having to incorporate these higher cost
operations, has been reduced by the depreciation of our currency as working
costs measured in US$/oz decreased from US$246/oz to US$234/oz for the
financial year. The average gold price received decreased from US$290/oz to
US$274/oz over the same period, a decrease of 6%.
The interest charges associated with the debt, used to finance our
acquisitions, which amounted to R94,2 million, and taxation of R66,3 million
resulted in earnings, before impairment being marginally lower at R326
million compared to the R364 million for the previous year.
Your company is now well positioned as one of the leading gold producers in
the world. In our current environment of industry consolidation and a gold
price which remains under pressure, the company identified the need to
aggressively continue with its growth strategy. This will be achieved
through focus on increasing profit margins of existing operations and
identifying further South African turnaround opportunities.
Despite accounting for impairment, the strong cash generating potential of
the company has enabled the Board to recommend that a final dividend of 70
cents be paid. The total dividends declared for the financial year ended 30
June 2001 totalled 120 cents.
Following the acquisition of Elandskraal and New Hampton in the first few
months of this calendar year, the company announced its intention to
restructure its balance sheet to enable it to continue with its growth
strategy. This was achieved in four phases namely the:
(i) consolidation of the company's debt following the acquisitions of
Randfontein, Elandskraal and New Hampton through an international syndicated
loan facility of R2,0 billion,
(ii) a cash injection following our empowerment transaction with the IDC,
the total transaction value being R400,0 million,
(iii) the issue of a domestic bond of R1,2 billion to retire the local debt
taken on during the first phase, and
(iv) the successful completion of a specific issue of shares and warrants
for cash which resulted in an additional R1,2 billion being available to
retire the mainly international debt taken on during the initial phase. A
total of 27,1 million ordinary shares at a price of R43,00 per share and 9
million warrants were issued. The warrants are listed on the JSE Securities
Exchange South Africa under the symbol "HARW" and on the NASDAQ under the
symbol "HGMCW". As at 30 June 2001 the company had 144,6 million ordinary
shares outstanding.
In line with our policy of not producing gold at a total cost above the spot
price, thereby destroying value for our shareholders and the industry at
large, we completed a review of all the company's operations in early 2001.
Our decision to put Bissett on a care and maintenance programme, close
Randfontein No. 4 Shaft and Evander No. 9 Shaft, has resulted in the company
having to impair its asset base by an amount of R200 million. The company
has, despite the low gold price over the past few years, been prudent in the
valuation of its assets and ore reserves. Closures of shafts however
necessitate impairment adjustments.
The impact of these closures, whilst being tough decisions to implement from
a social and employment perspective, will reflect in the expected improved
overall performance of the company in the following financial year.
Financial Year
ending                       June 1999    June 2000    June 2001
Impairment                   112          -            200
It is our belief that in the short term the South African gold mining
industry, and more specifically the Free State goldfields, has reached the
stage whereby orebody consolidation remains the only alternative to create
increased operational margins and shareholder value for all stakeholders.
During the past twelve months we have experienced decreased margins at our
Free State operations mainly due to the average grade being lower than the
previous reporting period, which has impacted adversely on the company's
overall Rand/kg and profitability results. A similar trend is being
experienced by the other stakeholders in the region and the restructuring
for increased efficiency could make this region financially attractive
again.
In the longer term we will remain competitive through the further upgrading
of our production base as well as continuously focussing on cost reductions
and improved productivity at all our operations.
Platinum Exploration Activities
Evaluation work on the Stella PGM project continued during the quarter under
review. An additional 33 boreholes (2 850m) were drilled, orebody models
reviewed, resource calculations revised and preliminary scoping studies were
undertaken on project economics.
As at 30 June 2001 the following in situ inferred mineral resource is
estimated from borehole intersections:
                          Tonnage        Grade g/t
                           000's         Pt + Pd + Au   Kgs       Ounces
Total                     66 500         1,6            106 400   3 420 000
The project work completed this quarter has resulted in a 25% increase in
tonnage and a 7% increase in grade which resulted in the resource increasing
by 31% from 2,6 million ounces to 3,4 million ounces. Included in this
resource are 1,3 million ounces at 2,25 g/t.
A total of 35 parties have expressed an interest in reviewing the Stella
project. Various technical presentations and site visits have subsequently
taken place.
To further improve our confidence in the project, the company intends
spending an additional R3 million on pre-feasibility testwork involving
drilling to confirm the geometry of the priority reef zones and to obtain
representative samples for further metallurgical testwork. This process is
expected to be completed in three months.
Quarterly operational review
The company reported an increase of 35% in cash operating profit to R190,5
million. This was R49.4 million more than the R141,1 million reported for
the previous quarter.
Net profits were however less at R40,1 million compared to the R70,6 million
previously reported. This decrease can mainly be attributed to:
(i)    interest payments of R53,2 million which were incurred as a result of
the debt facilities utilised with the acquisition of Elandskraal and New
Hampton,
(ii)    increased depreciation and amortisation charges following the
incorporation of these acquisitions, and
(iii)    higher taxation with Evander being in a full tax paying position.
cash operating profit vs US$ gold price
As quarter on quarter analysis of the various operations shows the impact
from the incorporation of the Elandskraal and New Hampton operations.
TOTAL WORKING PROFIT(LOSS) (R'million)
Operations                     March 2001    June 2001    Variance
Free State                     17,2          4,6          (12,6)
Evander                        78,2          64,8         (13,4)
Randfontein                    55,4          58,9         3,5
Elandskraal                    -             59,2         59,2
Kalgold                        (3,4)         1,0          4,4
Bissett                        (6,3)         (1,8)        4,5
New Hampton                    -             3,8          3,8
TOTAL                          141,1         190,5        49,4
The operations in general reported good performances compared to the March
2001 quarter, with excellent performances by Evander and Elandskraal.
Kalgold returned to profitability mainly due to an improvement in grade.
Bissett made a smaller loss as underground ore available from previous
development and mining activities were processed as part of the winding down
operations.
Although we have over the past four quarters referred to the variability of
the various orebodies, especially at the Free State operations, the company
continues to deliver average cash operating profits of approximately R165
million per quarter. This is significantly higher than the approximately
R115 million on average per quarter achieved during the previous financial
year. This has been despite the impact of having to restructure the newly
acquired high cost operations and incorporating these cost structures into
the Harmony structures.
Our focus in the next quarter will be directed at the critical evaluation of
our Free State operations. As indicated previously, these operations are in
a phase whereby profit margins have shrunk due to variability of the
recovered grade. This has in return impacted adversely on the recovery grade
of this region, which at 4,0 g/t is 15% lower than the 4,7 g/t reported for
the previous financial year.
In line with our policy of not mining gold at a total cost higher than the
spot price, production units that have come to the end of their economical
life will be closed. Limited life shafts will be structured for
profitability during their winding down phase.
Free State operations
The need for the restructuring of the Free State operations has become more
evident although it continues to make small profits. Cash operating profit
decreased from R17,2 million to R4,6 million. Underground tonnage decreased
by 156 000 tonnes or 12% from 1 322 000 tonnes to 1 166 000 tonnes. At a
lower grade of 3,95 g/t compared to the 4,12 g/t for the March 2001 quarter,
these operations reported a 16% decrease in gold recovered, down from 5 447
kgs to 4 604 kgs in the last 2001 quarter.
The lower recovery grade impacted on the cost indicators for the operations
with increases being reported in US$/oz and R/tonne measures.
As discussed previously, the Free State operations which have always been an
important contributor to cash operating profits, are being reviewed and
structured for optimal profitability. The results and action steps from this
evaluation process will be presented to shareholders at the September 2001
quarterlies.
Evander operations
The Evander operations again returned an excellent performance, mainly due
to the overall recovery grade increasing from 6,22 g/t to 6,47 g/t an
increase of 4,0%. This increase occured in the No. 8 Shaft decline area.
Tonnages were 67 000 tonnes or 11% lower at 532 000 tonnes compared to the
599 000 tonnes for the previous quarter. This decrease in tonnage was mainly
the result of under performance at No. 2 and No. 7 Shafts and closure of No.
9 Shaft.
The lower tonnages impacted on the per tonne costs reported by the
operation. When measured on US$/oz terms costs increased from US$188/oz in
the March 2001 quarter to US$194/oz for the current quarter. The Evander
operations, despite being loss making at the time of acquisition some 12
quarters ago, now operate at a cash operating profit margin of 27%.
recoupment of evander investment
When the acquisition of Evander is evaluated in terms of value creation and
increasing profit margins, the graph clearly illustrates that even after
capital expenditure to maintain the development of the declines and
infrastructure of the operation, the transaction has delivered real value to
our shareholders.
Randfontein  operations
Although being adversely affected by the restructuring of the operations
following the closure of No. 4 Shaft and the scheduled closure of the Lindum
surface operations, the Randfontein operations returned a R3,5 million or
6,3% improvement in cash operating profit. Cash operating profits increased
from R55,4 million to R58,9 million over the reporting period.
In line with expectations underground tonnages decreased by 258 000 tonnes
from 996 000 tonnes to 738 000 tonnes over this period. At a recovery grade
of 4,93 g/t compared to 4,99 g/t for the March 2001 quarter, gold recovered
was down at 3 641 kgs. The closure of the loss making operations had a
favourable impact on rand/tonne units costs with a 7,7% decrease from R284
per tonne to R262 per tonne. In US$/oz terms the decrease was higher at
9,3%, down from US$227/oz to US$206/oz.
recoupment of randfontein investment
Our focus is increasing operating margins and creating value opportunities
through the acquisition of turnaround assets, like Randfontein which
continues to deliver results similar to that of Evander. The company is well
on track to recover its investment which was made early in January 2000.
Elandskraal operations
The improved performance of the Elandskraal operations have been included in
the company's results for the first time. These operations returned cash
operating profits of R59,2 million. The operations milled 578 000
underground tonnes at an average grade of 6,40 g/t.
At the time of acquiring these operations we reported that it was our plan
to reduce the rand/tonne costs by an initial R60,00 per tonne in the short
to medium term. The implementation of the "Harmony Way" continues to impact
on these operations with costs decreasing from approximately R450 per tonne
to R350 per tonne for the June 2001 quarter. Our focus will be to continue
critically evaluating the cost structures at Elandskraal as this will
favourably impact on our ability to decrease cut-offs, which would result in
increased tonnage from underground.
On US$/oz terms, the Elandskraal operations compare favourably with our
other high profit margin operations with cash working costs of US$209/oz. As
reported previously, we believe that the Elandskraal acquisition will
contribute significantly to the company's overall performance and deliver
shareholder value in terms of earnings per share.
Our primary objective for the next 12 months remains to keep Elandskraal
self funding after capex.
Kalgold operations
Kalgold returned to profitability this quarter. The operations reported a
profit of R1,0 million compared to the loss of R3,4 million for the March
2001 quarter. The main contributing factor being the 33% increase in
recovery grade, up from 1,28 g/t to 1,70 g/t.
Tonnage increased in line with expectations with 21 000 tonnes or 9,8% from
215 000 tonnes to 236 000 tonnes. At the higher recovery grades, gold
production increased by 125 kg or 45% from 276 kgs to 401 kgs.
This improvement in performance at Kalgold is expected to continue for the
foreseeable future.
New Hampton, Australia
The company's offer to minority shareholders was finally closed on July 12
at which point 96,2% of ordinary shareholders and over 95% of option holders
had accepted our bid. In terms of the Australian Stock Exchange, the company
is now proceeding with the compulsory acquisition of the remaining ordinary
shares and options. The Melbourne office has been closed with all functions
being performed by the Perth office.
New Hampton can be described as having five different measurable components;
mills at Big Bell (capacity of 220 000 tpm) and Jubilee (capacity of 90 000
tpm) respectively, open pit mining operations at both the operations and
underground mining at Big Bell.
Both Big Bell and Jubilee have introduced new mining plans which allow
mining from current reserves up to the 2002/03 financial year. Overall the
focus is on finding replacement ore reserves through an aggressive
exploration programme to convert current resources.
The combined operations produced a total of 1 731 kg (55 653 oz) at an
average cost of A$514 per ounce (US$264 per ounce). After hedging
adjustments, the company returned an operating profit of A$920 000.
The company has reduced the aggressive hedge book by 170 000 oz to 807 000
ounces with an average strike price of A$491/oz (approximately US$252/oz).
Our strategy is to manage these positions and restructure them when
opportunities arise.
Over the following twelve months our focus will be on:
(i) re-establishing the development and mining of the lower levels of the
Big Bell underground mine which was severely affected by a seismic event in
late 2000,
(ii) fully developing the Trojan open pit at Jubilee and acquiring more
reserves for this operation,
(iii) improving efficiencies and costs at both mills,
(iv) acquiring more reserves and resources for the company, and
(v) settling down and Harmonising the operations.
Capital
expenditure
                              June        September
                              Quarter     Quarter
Operations                    Actuals     Forecast
Free State                    19          10
Evander                       16          15
Randfontein                   10          8
Bissett                       2           -
Kalgold                       -           -
Elandskraal                   25          35
New Hampton                   2           5
Total                         74          73
Notice of final
dividend
A dividend No. 73 of 70 cents per ordinary share, being the final dividend
for the financial year ending 30 June 2001, has been declared payable on 20
August 2001 to those shareholders registered in the books of the company at
the close of business on 17 August 2001.
The dividend is declared in the currency of the Republic of South Africa.
Dividend cheques will be posted from the office of the transfer secretaries
in South Africa or the registrars in the United Kingdom on or about 20
August 2001.
Any change in address or dividend instruction to apply to this dividend must
be received by the company's transfer secretaries or registrar not later
than 10 August 2001.
This announcement will be mailed to all registered shareholders on or about
3 August 2001.
Last date to trade ordinary shares cum dividend              10 August 2001
Ordinary shares trade ex dividend                            13 August 2001
Record date                                                  17 August 2001
Payment date                                                 20 August 2001
By order of the Board
FW Baker                                                     Virginia
Company Secretary                                            1 August 2001
Termination of listing of options to subscribe for one ordinary share in the
share capital of Harmony
On 9 July 2001, an announcement was made to holders of options to subscribe
for one ordinary share of R0,50 in the share capital of Harmony, at a
subscription price of R60,00 per ordinary share. Holders were advised on the
salient dates for the suspension and termination of the listing of the
options on the JSE Securities Exchange South Africa.
Dates were as follows:
Last date to trade options on the JSE                          24 July
Suspension of trading of options on the JSE
(at the commencement of business)                              25 July
Termination of listing of options on the JSE
(at the commencement of business)                              1 August
Operating
and financial
results (rand/metric)
                    Free
                    State  Evander  Evander  Bissett  Kalgold   Rand-
                    Total  U/g      Surface  Total    Opencast  Fontein U/g
Ore milled Jun-01   1 166  532      35       81       236       738
- t'000    Mar-01   1 322  599      52       64       215       996
Gold
Produced   Jun-01   4 604  3 440    39       401      401       3 641
- kg       Mar-01   5 447  3 723    59       295      276       4 970
Yield -
g/tonne    Jun-01   3.95   6.47     1.11     4.95     1.70      4.93 76
Mar-01              4.12   6.22     1.13     4.61     1.28      4.99
Cash
Operating  Jun-01   68 995 50 168   51 795   77 446   67 374    53 122
Costs - R/kg
           Mar-01   64 822 47 228   51 644   96 495   80 460    56 977
Operating  Jun-01   272    324      58       383      114       262
Costs -
R/tonne    Mar-01   267    294      59       445      103       284
Working
           Jun-01   322 205 236 763 2 663    29 236   28 025    254 465
Revenue
(R'000)
           Mar-01 370 295   253 080 3 971    22 212   18 770    337 979
Cash
Operating   Jun-01 317 652 172 578  2 020   31 056    27 017   193 419
Costs
(R'000)      Mar-01 353 086 175 830    3 047   28 466  22 207  283 178
Cash
Operating    Jun-01 4 553 64 185       643     (1 820) 1 008   61 046
Profit
(R'000)      Mar-01 17 209   77 250    924     (6 254) (3 437) 54 801
                Rand-     Elands-   Elands-     New
                fontein    kraal     kraal       Hamp-
                Surface    U/g       Surface     ton      Total
Ore milled      308        578       128         1 088    4 890
Rands-
- t'000         575         -         -          -         3 823
Produced        301         3 698     124        1 731     18 380
- kg            575        -          -          -        15 345
                1.00       -          -          -        4.01
Cash
Operating       75 532      54 673     32 556     68 264  59 350
Costs -
R/kg    Mar-01  66 807     -           -           -       58 927
Cash
Operating
        Jun-01  74         350        32          109      223
Costs -
R/tonne Mar-01   67         -         -           -       237
Working Jun-01   20 649    256 820   8 613121    921 1   281 360
Revenue
(R'000) Mar-01   39 059     -         -           -       1 045 366
Cash
Operating
       Jun-01    22 735     202 180  4 037      118 165 1 090 859
Costs
(R'000)
        Mar-01   38 414      -        -           -       904 228
Cash
Operating
       Jun-01    (2 086)    54 640   4 576       3 756  190 501
Profit
(R'000)
       Mar-01     645        -        -          -       141 138
# The impairment charge relates to the write down of our Bissett Operations
which have been put on care and maintenance and the closure of Cooke 4 Shaft
on the Randfontein Operations, as well as the write down of certain Free
State Operation's shafts.
* Calculated on weighted average number of shares in issue during the
quarter: 107.8 million (March 2001: 104.3 million)
* Calculated on weighted average number of shares in issue during the year:
102,9 million (June 2000: 83,4 million)
Abridged balance sheet (rand) (unaudited)
                                           *At                   At
                                       30 June             31 March
                                          2001                 2001
                                         R'000                R'000
Employment of Capital
Mining assets after amortisation     5 423 640            3 909 732
Investments                            533 440              468 178
Loans to share trusts                   30 729               12 556
Net current (liabilities)/assets     (145 728)               45 327
(excluding cash)
Short-term investments
- Western Areas                              -               74 457
Cash                                 1 158 531              340 526
                                     7 000 612           4 850 776
Capital Employed
Shareholders' equity                 4 587 828            3 266 670
Loans                                1 200 000              610 621
Long-term provisions                   435 271              374 448
Unrealised hedging loss                396 969              238 300
Deferred tax                           380 544              360 737
                                     7 000 612            4 850 776
 Issued share capital: 144.6 million ordinary shares of 50 cents each.
 (March 2001:  104.3 million)
*The incorporation of the New Hampton and Elandskraal Operations caused
significant variances to comparative balances
Operating
    and financial
results(US$/imperial)
                      Free
                     State Evander      Evander  Bissett  Kalgold
                     Total    U/g       Surface  Total    Opencast
Ore milled
- t'000     Jun-01   1 286    587       39       89       260
            Mar-01   1 458    661       57       71       237
Gold Produced
- oz        Jun-01   148 021  110 598   1 254    12 892   12 892
            Mar-01   175 124  119 697   1 897    9 484    8 874
Yield
- oz/ton    Jun-01   0.115    0.188     0.032    0.145    0.050
            Mar-01   0.120    0.181     0.033    0.134    0.037
Cash
Operating   Jun-01   267     194       201      300       261
Costs
- $/oz      Mar-01   258     188       206     384       320
Cash
Operating   Jun-01   31      37        6        43        13
Costs
- $/ton     Mar-01   31      34        7        51        12
Working
Revenue     Jun-01   40 125  29 485    332      3 641     3 490
($'000)     Mar-01   47 352  32 363    508      2 840     2 400
Cash
Operating   Jun-01   39 558  21 492    252      3 867     3 365
Costs
($'000)     Mar-01   45 152  22 485    390      3 640     2 840
Cash
Operating   Jun-01   567     7 993     80       (226)     125
Profit
($'000)     Mar-01   2 200  9 878     118       (800)     (440)
                 Rand-    Elands-   Elands-  New
                    fontein  fontein   kraal    kraal   Hamp-
                    U/g      Surface   U/g      Surface ton     Total
Ore milled
- t'000    Jun-01   814      340       637      141     1 200  5 393
           Mar-01   1 098    634       -        -       -      4 216
Gold Produced
- oz       Jun-01   117 060  9 677     118 893  3 987  55 653  590 927
           Mar-01   159 788  18 487    -        -      -       493 351
Yield
- oz/ton   Jun-01   0.144    0.028     0.187    0.028  0.046   0.110
           Mar-01   0.146    0.029     -        -      -       0.117
Cash
Operating  Jun-01   206      293       212      126    264     230
Costs
- $/oz     Mar-01   227      266       -        -      -       234
Cash
Operating  Jun-01   30       8        40       4      12      25
Costs
- $/ton    Mar-01   33       8         -       -       -       27
Working
Revenue    Jun-01   31 689   2 571    31 983   1 073  15 183 159 572
($'000)    Mar-01   43 220   4 995     -       -       -     133 678
Cash
Operating  Jun-01   24 087   2 831    25 178   503    14 715 135 848
Costs
($'000)   Mar-01    36 212   4 912    -        -       -     115 631
Cash
Operating  Jun-01   7 602   (260)    6 805     570    468   23 724
Profit
($'000)    Mar-01   7 008    83      -          -     -     18 047
Financial
total operations (US$/imperial) (unaudited)
Quarter    Quarter                                  Year         Year
  ended     ended                                 ended         ended
31 March    30 June                             30 June       30 June
    2001       2001                                 2001          2000
  4 216      5 393    Ore milled - t'000          18 828       13 096
 493 351    590 927    Gold produced - oz      2 140 040    1 625 925
    271        270    Gold price received
- $ / oz                                             274          290
    234       230    Cash operating costs
- $ / oz                                             234          246
  $'000      $'000                                 $'000        $'000
 133 678    159 572    Gold sales                587 042      471 754
 115 631    135 848    Cash operating costs      500 448      399 171
 18 047     23 724    Cash operating profit       86 594       72 583
 (6 035)    (8 834)    Amortisation             (31 148)     (21 448)
                      (Loss)/gain on financial
  (531)      (238)    instruments                 7 640        8 559
   (57)      (484)    Employment
termination costs                                (1 693)        (221)
  2 877      4 436    Other income - net         18 293       19 036
 (1 674)    (6 626)    Interest paid            (12 375)      (3 199)
 (1 145)    (1 789)    Corporate expenditure     (4 690)      (1 951)
 (1 130)    (1 127)    Exploration and
new business                                     (4 563)      (2 500)
 10 352      9 062    Profit before taxation     58 058       70 859
                      South African normal taxation
 (1 395)    (3 034)    - Current tax             (8 708)      (3 475)
     70    (1 033)    - Deferred tax            (6 507)     (10 063)
  9 027      4 995    Earnings after tax         42 843       57 321
      -         -    #Impairment of
fixed assets                                   (26 330)           -
  9 027      4 995    Net earnings               16 513      57 321
                      *Earnings per share - cents
      9          5    - Earnings                    42          69
      -          -    - Net earnings
after impairment                                    16          69
      -          9    Dividends per share
- (cents)                                           16          19
 Prepared in accordance with International Accounting Standards
 Currency conversion rates: US$1 = R8.03 (March 2001: R7.82)
 Currency conversion rates for the year: US$1 = R7.61 (June 2000: R6.35)
#The impairment charge relates to the write down of our Bissett Operations
which have been put on care and maintenance and the closure of Cooke 4 Shaft
on the Randfontein Operations, as well as the write down of certain Free
State Operation's shafts.
*Calculated on weighted average number of shares in issue during the
quarter: 107.8 million (March 2001: 104.3 million)
 Calculated on weighted average number of shares in issue during the year:
102,9 million (June 2000: 83,4 million)
Abridged balance sheet
(US$) (unaudited)
                                               *At           At
                                           30 June     31 March
                                             2001         2001
                                           US$'000      US$'000
Employment of Capital
Mining assets after amortisation           675 422      499 966
Investments                                 66 431       59 869
Loans to share trusts                        3 827        1 606
Net current (liabilities)/assets          (18 147)        5 796
(excluding cash)
Short-term investments
- Western Areas                                  -        9 521
Cash                                       144 275       43 545
                                           871 808      620 303
Capital Employed
Shareholders' equity                      571 336      417 732
Loans                                     149 440       78 085
Long-term provisions                       54 206       47 883
Unrealised hedging loss                    49 436       30 473
Deferred tax                               47 390       46 130
                                          871 808      620 303
 Issued share capital: 144.6 million ordinary shares of 50 cents each.
 (March 2001: 104.3 million)
 Currency conversion rates:  US$1 = R8.03 (March 2001: R7.82)
*The incorporation of the New Hampton and Elandskraal Operations caused
significant variances to comparative balances
Condensed statement of changes in shareholders' equity
(Unaudited)
                              At           At          At          At
                         30 June      30 June     30 June     30 June
                            2001         2000        2001       2000
                           R'000        R'000     US$'000     US$'000
Balance as at the
beginning of the
financial year         2 874 718    1 723 429     357 997     257 998
Currency translation
adjustment and other       7 408     (19 915)         923     (2 981)
Issue of share capital  1 732 652     916 404     215 772     137 186
Net earnings             125 675     363 980       15 651      54 488
Dividends paid         (152 625)   (109 180)     (19 007)    (16 344)
Balance as at the
end of June            4 587 828   2 874 718      571 336     430 347
Currency conversion rates used:
US$1 = R8.03 (June 2000: R6.68)
Development
results - (Metric)
                                        Channel     Channel
                 Reef       Sampled      Width       Value       Gold
               Meters        Meters      (Cm's)       (g/t)    (Cmg/t)
RANDFONTEIN
VCR REEF          428          330         148       10.36      1 533
UE 1A           2 164        1 944         103       10.28      1 059
E8 REEF            10           10          79         8.9        703
KIMBERLEY REEF    238          211         247        3.98        984
ALL REEFS       2 840        2 495         121        9.21      1 114
FREE STATE
BASAL           1 859        1 422          87        9.85        857
LEADER          1 096          858         140        6.31        884
A REEF            579          438         102        6.20        632
MIDDLE            218          148         103       10.87      1 120
B REEF            148           49         124       19.73      2 446
ALL REEFS       3 900        2 915         106        8.22         871
EVANDER
KIMBERLEY REEF  3 176        3 066          75       10.85        814
Elandskraal
VCR REEF          657          720          75      13.37      1 003
Development
       results - (imperial)
                                        Channel     Channel
                 Reef       Sampled      Width       Value       Gold
                 feet        feet     (inches)      (0z/t)   (in.ozt)
RANDFONTEIN
VCR REEF        1 403       1 083          58       0.303         18
UE1A            7 099       6 378          41       0.297         12
E8 REEF            33          33          31       0.260          8
KIMBERLEY REEF    782         692          97       0.116         11
ALL REEFS       9 317       8 186          48       0.266         13
FREE STATE
BASAL           6 100       4 665          34       0.289         10
LEADER          3 594       2 815          55       0.185         10
A REEF          1 898       1 437          40       0.182          7
MIDDLE            716         486          41       0.314         13
B REEF            487         161          49       0.573         28
ALL REEFS      12 795       9 564          42      0.238         10
EVANDER
KIMBERLEY REEF  10 420     10 059          30       0.312          9
Elandskraal
VCR REEF        2 156       2 362          30       0.384         12
This report was approved by the board of directors and is signed on its
behalf by:
Z B Swanepoel                F Abbott
Chief executive              Financial director
20 July 2001
Investors' information
Business address
Harmony Gold Mining Company Limited
Randfontein Office Park
C/o Main Reef Road and Ward Avenue
Randfontein, PO Box 2, Randfontein, 1760
Telephone: +27 (11) 412-1450
Telefax: +27 (11) 692-3879
E-mail: corporate@harmony.co.za
Investor relations
For further information contact:
Corn  Bobbert
Telephone: +27 (11) 412-1450
Telefax: +27 (11) 692-3879
E-mail: cbobbert@harmony.co.za
Share transfer secretaries
Ultra Registrars (Pty) Ltd
Contact: Polly Pollard
Telephone: +27 (11) 370 5775
Telefax: +27 (11) 370 5780
E-mail: ultra@registrars.co.za
11 Diagonal Street
Johannesburg 2001
(PO Box 4844, Johannesburg, 2000)
United States Depositary
American Depositary Receipts,
The Bank of New York
Contact: Melissa Atheneos
Telephone: +1 (21) 815 5133
Telefax: +1 (212) 571 3050
E-mail: matheneos@bankofny.com
Shareholder Relations Department
101 Barcley Street, New York, NY10286
United States of America
United Kingdom Registrars
Capita IRG Plc
Contact(s): Melvyn Leigh/Therese Hodgin
Telephone: +44 (208) 639 1001
Telefax: +44 (208) 478 2876
E-mail: mleigh@capita-irg.com/thodgin@capita-irg.com
Balfour House 390-398
High Road, Ilford
Essex IG1 1NQ, United Kingdom
North American investor and shareholder enquiries
Roth Investor Relations  Inc.
Contact: Michelle B. Roth (President)
Telephone: +1 (732) 792-2200
Telefax: +1 (732) 792-2211
E-mail: michelleroth@rothir.com
215 Gordons Corner Road, Suite 2A, Manalapan
New Jersey 07726
United States of America
Directors
A R Fleming*+(Chairman),
ZBSwanepoel (Chief executive), FAbbott,
F Dippenaar, Dr. A M Edwards*, TSA Grobicki,
MFPleming*, Lord Renwick of Clifton KCMG*+,
Dr. G S Sibiya*,
*Non executive directors +British
Enquiries concerning this report can be directed to:
Theresa Lee
PO Box 2 Randfontein, 1760
Telephone: +27 (11) 411-2227
Facsimile: +27 (11) 692-3879
E-mail: tlee@harmony.co.za
Trading Symbols
Ordinary Shares
JSE Securities Exchange         :        HAR
Nasdaq                          :      HGMCY
London Stock Exchange           :       HRM
Euronext Paris                  :        HG
Euronext Brussels               :        HMY
Warrants
JSE Securities Exchange         :      HARW
Nasdaq                         :      HGMCW
Our 2001 Annual Report will be available from 1 October 2001 and can be
viewed on our website at http://www.harmony.co.za
To receive a hard copy, please call
Corne Bobbert on
+27 11 412-1450
or send an e-mail to
cbobbert@harmony.co.za



                                        
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