Harmony Receives Avgold Shareholder Approval And Closes Out Target Hedge Book Release Date: 03/05/2004 15:03:01 Code(s): HAR
Harmony Receives Avgold Shareholder Approval And Closes Out Target Hedge Book
Harmony Gold Mining Company Limited
(Incorporated in the Republic of South Africa)
(Registration number 1950/038232/06)
ISIN No.: ZAE000015228
Johannesburg, Monday 3 May 2004 - Harmony Gold Mining Company Limited
(NYSE: HMY JSE: HAR) today reported that 96% of Avgold minority shareholders
voted in favour of a scheme of arrangement whereby Harmony intends acquiring
100% of Avgold"s issued share capital. In addition, Harmony announced more
details on the restructuring of the Target hedge book.
"Target Mine is a low cost operator and should not be burdened by the adverse
impact of a hedge book. Like all the previous hedge books we inherited through
our acquisition activities, we undertook to deal with it as soon as possible,"
commented Bernard Swanepoel, Chief Executive.
The hedge book, consisting of approximately 515 000 ounces, had a negative mark
to market value of R361 million as at 31 March 2004. The Rand gold portion of
the hedge book was closed out in full at a cost of R20 million. Included in the
mark to market value is an amount of R309 million attributable to forward
exchange contracts entered into in June 2003. Currency call options have been
sold to cover the residual forward exchange contracts that were calculated at a
gold price of US$425,50/oz and an exchange rate of R6,36 to the US Dollar.
Changes in the fair value of the forward exchange contracts due to exchange rate
movement, will be reflected in adjustments to the company"s income statement.
"During the past quarter, this operation received a gold price which at R67
425/kg, was 31% lower compared to the R88 277/kg received by Harmony. The
restructuring of this hedge book leaves Target in an unhedged position with the
ability to sell its gold freely on the spot market," concluded Bernard.
Issued by Harmony Gold Mining Company Limited
3 May 2004
For more details contact:
on +27(0)83 303 9922
on +27(0)82 807 3684
Investor Relations Officer
Tel +27 11 684 0146
Mobile +27(0)83 380 6614
Date: 03/05/2004 03:03:04 PM Supplied by www.sharenet.co.za
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