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HAR - Harmony Gold Mining Company - Financial Review For The Fourth Quarter And
Release Date: 15/08/2008 08:55:37 Code(s): HARHAR - Harmony Gold Mining Company - Financial Review For The Fourth Quarter And
Year Ended 30 June 2008
Harmony Gold Mining Company Limited
Registration number 1950/038232/06
Incorporated in the Republic of South Africa
ISIN: ZAE000015228
Trading Symbols
JSE Limited HAR
New York Stock Exchange, Inc. HMY
London Stock Exchange plc HRM
Euronext Paris HG
Euronext Brussels HMY
Berlin Stock Exchange HAM1
NASDAQ HMY
Issuer code HAPS
FINANCIAL REVIEW FOR THE FOURTH QUARTER AND YEAR ENDED 30 JUNE 2008
ANNUAL HIGHLIGHTS
* Cash operating profit up by 26%
* Extensive restructuring of operations completed
* Harmony PNG/Newcrest Stage 1 of partnership finalised
(shortly after year end)
* Tshepong 66 decline project complete
* Phakisa brought into production
FINANCIAL SUMMARY FOR THE FOURTH QUARTER AND YEAR ENDED 30 JUNE 2008
(All results exclude Discontinued Operations unless otherwise indicated)
Quarter Quarter Q-on-Q
June 2008 March 2008 % variance
Gold produced - kg 11 694 10 347 13.0
- oz 375 970 332 662 13.0
Cash costs - R/kg 138 940 146 620 5.2
- $/oz 556 609 8.7
Cash operating profit - Rm 995 817 21.8
- US$m 128 111 15.3
Basic (loss)/profit - SA c/s (60) 38 (257.9)
- US c/s (8) 5 (60.0)
Headline profit/(loss) - SA c/s 38 39 (2.6)
- US c/s 5 5 -
Quarter
June 2007 FY08 FY07
Gold produced - kg 12 414 48 227 54 340
- oz 399 118 1 550 527 1 747 071
Cash costs - R/kg 149 379 138 319 110 785
- $/oz 655 591 479
Cash operating profit - Rm 25 2 537 2 016
- US$m 4 351 280
Basic (loss)/profit - SA c/s (43) (199) 206
- US c/s (6) (27) 29
Headline profit/(loss) - SA c/s (81) 19 96
- US c/s (11) 3 13
CHIEF EXECUTIVE`S REVIEW
It is my pleasure as Chief Executive Officer of Harmony to submit this
financial report for the financial year ended 30 June 2008 to shareholders
after managing the company for a full financial year.
2008 Review
I will briefly review the company`s activities over the past year and its
current financial status, expanding on the changes that were implemented to
return the company to profitability in order to generate positive financial
returns, in the future, for our shareholders.
Before proceeding with this year`s corporate and financial activities, I would
like to draw attention to the Elandsrand incident that occurred on 3 October
2007. I want to thank our Chairman and the Harmony team involved in the
successful handling of the incident for their support and sterling efforts.
Gratefully there were no negative consequences from the compressed air column
that fell down the mine shaft.
The Elandsrand incident brought the South African mining industry`s safety
record squarely under the spotlight. This has triggered a heightened sense of
corporate awareness towards the critical issues of occupational safety and
health. Safety enjoys priority at Harmony and non-negotiable safety standards
have been formulated which are reviewed and performances audited. I am pleased
to inform you that last year`s positive safety performance was maintained in
the 2008 financial year.
Turning to the financial performance for the year under review, we carried out
a due diligence on our mines towards the end of 2007 to understand the
challenges facing the company at that time. Based on the findings we embarked
on a restructuring strategy. We recognised that stringent cost control measures
had to be put in place to reduce their negative impact. Thus, all capital
expenditure was reviewed and all frills expended without disrupting the
delivery of the projects. The restructuring process also brought about the
transfers of 13 101 employees and the termination of employment of 5 119 of our
employees. This reduced the average age of our workforce from 47 to 43 years.
Management was strengthened and we decentralised our regional operations. We
also made changes to our mining structure by eliminating coaches and
re-introducing mine captains and shift bosses to improve production.
Harsh decisions had to be taken regarding the productivity and efficiency of
Conops at some of our operations. During the year Conops was terminated at
Elandsrand, Evander 2 and 5, Cooke 1, 2 and 3 shafts, Masimong and Tshepong. I
am pleased to report that some benefits are already evident in the current
quarter from Tshepong and Elandsrand where production has been boosted.
Unfortunately early in January 2008, the South African economy suffered a
setback when Eskom - the national power utility - announced that it was unable
to supply uninterrupted power to the mining industry, amongst others. This
affected our strategic planning; new plans, incorporating the reduced power
consumption, were devised and implemented. The company continues to operate on
90% electricity consumption - 10% down from its previous consumption.
The new strategic plans aligned the whole company with the aim to conserve
electricity. This led to shafts and mining areas of high energy consumption
being closed down. Taking the electricity challenge into account, our objective
for the next year, barring any unforeseen circumstances, is to maintain the
current production level of 12 000kg of gold per quarter from the 13 500kg
before the power reduction. We have laid out an aggressive schedule to bring
all our projects to full capacity by 2012.
The last component of the due diligence was to honour the transactions that had
been entered into with regards to our discontinued assets in South Africa and
Australia. Accordingly, Orkney 2, 4 and 7 shafts were purchased by Pamodzi Gold
who took full ownership on 27 February 2008 when the transaction was
renegotiated, bringing Harmony`s shareholding in Pamodzi Gold to 32%.
South Kal Mines in Australia was sold to Dioro Exploration NL and all
conditions precedent were met on 30 November 2007.
Unfortunately the Mt Magnet deal was not concluded and we have recommenced the
sale process. In the interim, the operations remain on care and maintenance,
but we continue with the exploration of our tenements in the area.
Concurrently with the restructuring, we pursued joint venture opportunities
that offered obvious operational synergies. On the Cooke shafts in Randfontein
and in the Cooke tailings dam, we recognised the uranium potential, together
with the gold potential and realised that this could be a formidable value
creation opportunity. On 19 December 2007, Harmony concluded an agreement with
Pamodzi Resources Fund (PRF) and First Reserve Incorporated (FRI), backed by
APM and FRI, whereby we would retain a 40% stake in a new company (Rand Uranium
Company) by selling 60% to PRF. The agreement has been extended to 12 September
2008 due to outstanding conditions precedent which include the approvals from
the Department of Minerals and Energy and the National Nuclear Regulator.
It gives me pleasure to announce that all the conditions precedent have been
met for the 50:50 joint venture entered into on 22 April 2008 with Newcrest
Mining Limited, Australia, for Harmony`s PNG assets. The first tranche of the
deal, US$229 million, was received by Harmony on 7 August 2008. This concludes
Stage 1 signifying Newcrest`s ownership of 30.01% and the commencement of Stage
2, which requires that Newcrest increase its interest to 50% through the sole
funding of all the capital expenditure for Hidden Valley. As mentioned
previously, Newcrest is a quality partner with significant technical skills
that will provide additional expertise to the existing Harmony team in PNG and
add to the development potential of the PNG assets.
The creation of the joint venture reduces Harmony`s operational risk in PNG and
strengthens Harmony`s balance sheet, simultaneously reducing our capital
expenditure requirements at Hidden Valley. In addition, the partnership
improves the potential of the Wafi-Golpu deposit and its prospective
exploration tenements, to turn them to viable resources.
GROUP PERFORMANCE
Harmony`s operations recorded a satisfactory operational improvement in the
fourth quarter, however, the Group delivered a disappointing financial
performance for the financial year ended 30 June 2008.
A net loss of R245 million was recorded compared with a net profit of R382
million for the financial year ended 30 June 2007.
This is mainly due to non-cash item losses from the sale of Gold Fields shares
amounting to R459 million, the loss from associates (primarily Pamodzi Gold)
amounting to R78 million, impairment of investments in associates (primarily
Pamodzi Gold) of R95 million and impairment of assets amounting to R316
million.
Revenue for the year from continuing operations was up by 14.6% to R9 210
million from R8 037 million for the financial year 2007 on the back of an
improved gold price in dollar terms of US$818/oz and a steady R/$ exchange rate
of R7.26. The Group`s cash operating profit increased by 25.8% to R2 537
million compared with R2 016 million for 2007.
Cash operating costs increased year-on-year by R652 million from R6 021 million
to R6 673 million, for the year under review.
Although stringent measures for cost containment had been implemented
throughout the company, inflationary pressures were evident not only in most of
our consumables such as electricity, steel and fuel, to a lesser degree, but
also salaries.
Harmony`s total cash operating costs were up by 7.1% quarter-on-quarter to R1
625 million from R1 517 million. The company ascribes this in part to increases
in electricity tariffs, production tonnages and the bonus incentives paid to
mine overseers and shift bosses after the change in the mining structure.
Harmony reported a basic loss from continuing operations of 199 cents per share
for the year under review compared with a profit of 206 cents per share for
financial year 2007 and headline earnings of 19 cents per share for financial
year 2008 compared with a headline earnings of 96 cents per share for financial
year 2007.
Other financial items
Exploration expenditure
Harmony`s exploration activities for continuing operations carried out during
the year amounted to R205 million compared with R194 million in financial year
2007. Exploration activities occurred mostly in Papua New Guinea. The
Wafi-Golpu exploration tenements have been a large focus area with exploration
occurring on four potential copper-gold porphyry deposits. Exploration for
further gold deposits in the area surrounding the Hidden Valley mine was done
and will continue in 2009.
Continued exploration in PNG and the high-potential Wafi-Golpu area positions
Harmony favourably for substantial growth. We will continue to focus on our
drive to establish viable resources to add to our pipeline of gold ounces.
A small amount of drilling exploration also occurred in South Africa. Harmony`s
South African exploration programme for 2009 financial year includes the
drilling of Evander South and several underground areas in existing operations
(mainly B-reef and A-reef) in the Free State.
Impairment
An impairment of R316 million is attributed to the re-assessment of the assets
at Evander 5, West Shaft, Kudu/Sable and Kalgold.
CAPITAL EXPENDITURE
Attributable capital expenditure during 2008 totalled R3 647 million, of which
R1 428 million of this expenditure was incurred at the Hidden Valley mine
project in Papua New Guinea. It is anticipated that Hidden Valley will require
similar capex investment in the 2009 financial year. Harmony will, however,
only be responsible for a small portion of that commitment as our joint venture
partner Newcrest will cover the remaining requirements from August 2008 as
prescribed by Stage 2 of the partnership.
STRATEGY
The lengthy process of business plans was finalised toward the end of the June
2008 quarter. The Group`s business strategy has now been rolled out throughout
the Group.
Each operation has been separately assessed and individual benchmarks and
targets - which must be achieved by each operation - have been applied. The
production benchmarks include tonnes per man, grams per person and cost
reduction in Rand per kilogram.
We are confident that improvements in costs, safety, productivity, grade and
mine call factors will become evident in the quarters ahead.
In addition, Harmony recently committed to training programmes and related
development initiatives, especially in the fields of leadership development and
team training. These programmes are already showing improvements in attitudes
and morale.
ORE RESERVES
At 30 June 2008, Harmony`s ore reserves reflected a year-on-year depletion of
2.0 million ounces. Corporate activity, restructuring of certain shafts and
geological related changes accounts for a further decrease of 5.6 million
ounces of reserves. On the positive side there is a net addition of 4.5
million ounces of reserves from surface stockpiles.
The Statement of Mineral Resources and Ore Reserves, produced in accordance
with the South African Code for the Reporting of Mineral Resources and Mineral
Reserves (SAMREC Code), the Australian Code (JORC Code) as well as with the
Industry Guide 7 of the United States Securities and Exchange Commission, shows
Harmony`s gold mineral resources of 253.6 million ounces and ore reserves of
50.5 million ounces as at 30 June 2008. The mineral resources indicates a
year-on-year negative variance of 28 million ounces mainly as a result of
corporate activity relating to Papua New Guinea, Australia and the Randfontein
Cooke shafts.
A gold price of US$750/oz was used for the conversion of Mineral Resources to
Ore Reserves at our South African and Australian operations. An exchange rate
of US$/ZAR7.46 for South Africa and AU$/US$0.80 for Australia has been used,
resulting in a gold price of R180 000/kg and AU$850/oz, respectively.
In addition to the gold reserves, Harmony also reports its equity reserves
(69.9%) for silver, copper and molybdenum from its PNG operations. Metal prices
are assumed at US$12/oz for silver, US$2.40/lb for copper and US$20/lb for
molybdenum.
DIVIDEND
Harmony`s continued commitments to large capital expenditure projects will mean
that the cash generated by the operations will be used to continue to fund our
projects into full production stage. To this end, no final dividend was
declared by the Board of Directors for the financial year ended 30 June 2008.
The dividend policy will be reviewed in the second half of the 2009 financial
year.
OUTLOOK
Harmony`s outlook remains focused on sustainable organic growth. Opportunities
for further optimisation, improved production and production cost management
will be exploited. Enhanced cash flow will be used prudently to reduce our debt
and finance new mine capacity and other growth initiatives.
PNG and specifically the Wafi-Golpu area, because of its proximity to our
Hidden Valley project, will remain our major exploration focus. This region
provides opportunities to create value for shareholders because of the
possibilities of a larger and longer pipeline of quality and diversified
commodities projects. Thus, some of the funds available to Harmony from the
Newcrest partnership will be invested in exploring our tenements for additional
reserves and resources.
In South Africa, Evander South in Mpumalanga offers several new opportunities
for additional reserves. This implies commensurate exploration opportunities
for the adjacent Poplar and Rolspruit areas. Furthermore, with the strong
Rand/Dollar gold price, growth opportunities are plentiful from the 1 billion
tonnes of surface tailings in the Free State of which the possibility of
treating 12Mt a year at St Helena over the next 20 years will be investigated.
Harmony has been and will remain an acquisitive company should opportunities
exist or arise. Lately, we have entered into several partnering relationships,
the largest being with Rand Uranium and Newcrest in PNG. We will continue to
look for value opportunities on partnering some of our assets that have not
been approved by the board as new projects for the 2009 financial capital
programme.
A vote of thanks
I wish to thank the Board of Directors for their valued support and guidance
during one of Harmony`s toughest years. I wish to thank all the employees and
managers of Harmony for their hard work and depth of commitment to achieving
targets and to elevate performance. Lastly, I would like to thank our
shareholders for their loyalty to Harmony through this tough period.
SAFETY AND HEALTH REPORT
* Harmony recorded an improved safety performance for FY2008
* Target achieved three and a half years of Fatality Free shifts
* Evander achieved 1 500 000 Fatality Free shifts
* Tshepong Mines achieved 500 000 Fatality Free shifts
* Virginia operations achieved One Million Fatality Free shifts
Fatality injury rate (per million hours worked)
SEE PRESS FOR GRAPH
It is encouraging that the improvements in safety performance achieved by
Harmony in 2007 were sustained in 2008.
Management remains committed to zero-fatalities and every effort is being made
to achieve this objective. Safety is the number one priority among all
operational teams and many hours are being dedicated towards safety leadership
and awareness.
Safety audits have been intensified and the second audit programme was
completed at the end of June 2008. These audits include some non-negotiable
safety principles:
* Management to lead by example
* Continuous verbal communication with all team members
* Visible awareness-creation on safety
* Recognise and reward safety achievements
* Involve all stakeholders
The June quarter showed a 31.8% improvement in the fatality injury frequency
rate (FIFR) of 0.15 compared with 0.35 for the March quarter. An annualised
improvement of 18.2% was achieved for 2008.
The Lost Time Injury Frequency Rate (LTIFR) improved by 19.7% during the
quarter from a rate of 13.46 to 11.39, while an exceptional annualised
improvement of 16% was achieved.
Regrettably four employees lost their lives at Harmony`s operations during the
June 2008 quarter as a result of work-related accidents. Harmony`s deepest
condolences are extended to the families of the deceased employees.
During the year under review, the Group recorded some remarkable safety
achievements, among them was Target`s formidable feat of three years of
fatality free shifts. During the June 2008 quarter, Evander and Tshepong both
attained half-a-million fatality free shifts and Virginia, comprising Harmony,
Merriespruit, Unisel and Brand, achieved their One Million Fatality Free
shifts.
There were no lost time injuries at Hidden Valley during the quarter. Part of
this success can be attributed to effective weekly site inspections. In
addition, several training and proficiency programmes were developed and rolled
out during June 2008.
These are designed to improve the level of risk identification and safe work
practices at construction sites.
FOURTH QUARTER AND YEAR ENDED 30 JUNE 2008 UNDER REVIEW
Volumes milled for the June 2008 quarter increased by 9.9% from 4 125 000
tonnes to 4 534 000 tonnes. Production was up by 13%, with an increase of 1
347kg of gold compared with the March 2008 quarter. This is despite the four
public holidays during the quarter.
The disappointing 5.4% drop in the SA underground recovery grade from 4.81g/t
to 4.55g/t for the quarter, is ascribed to a 19.0% drop in grade at Tshepong
and 9.2% at Masimong. This was partly offset by a 15.0% and 11.8% higher
recovery grade from Target and Bambanani, respectively.
Joel Mine had a good quarter recovering from all the shaft stoppages in the
past and recorded 49.5% more tonnes and 46.4% more kilograms of gold compared
with the previous quarter.
Attributable gold produced from the continuing SA underground operations during
the June 2008 quarter, increased to 10 396kg from 9 302kg in the March 2008
quarter, due to an 18.1% increase in tonnages.
The Group`s increased gold production from 10 347kg to 11 694kg, a lower gold
price received of R224 036/kg from R225 544/kg and good cash cost containment
resulted in a cash operating profit of R995 million compared with R817 million
in the previous quarter.
The Group`s Rand per ton cost dropped from R368/t previously to R358/t for June
2008. The Rand per kilogram cost decreased from R146 620/kg in March 2008 to
R138 940/kg in June 2008.
The performance of the company`s continuing operations is set out in the
following tables:
Q-on-Q
June 2008 March 2008 % Variance
Production - kg 11 694 10 347 13.0
Production - oz 375 970 332 662 13.0
Revenue - R/kg 224 036 225 541 (0.7)
Revenue - US$/oz 897 944 (5.0)
Cash cost - R/kg 138 940 146 620 5.2
Cash cost - US$/oz 556 609 8.7
Exchange rate - USD/ZAR 7.77 7.43 (4.6)
June 2007 FY08 FY07
Production - kg 12 414 48 227 54 340
Production - oz 399 118 1 550 527 1 747 071
Revenue - R/kg 151 418 190 958 147 808
Revenue - US$/oz 664 818 639
Cash cost - R/kg 149 379 138 319 110 785
Cash cost - US$/oz 655 591 479
Exchange rate - USD/ZAR 7.09 7.26 7.20
Gold production from discontinuing operations was 12 387kg (398 249oz) for the
year under review compared with 18 262kg (587 127oz) for the financial year
2007.
Cash operating profit and margins
Q-on-Q
June 2008 March 2008 % Variance
Cash operating profit (Rm) 995 817 21.8
Cash operating profit margin (%) 38.0 35.0 8.6
June 2007 FY08 FY07
Cash operating profit (Rm) 25 2 537 2 016
Cash operating profit margin (%) 1.3 27.6 25.1
Quarter on quarter cash operating profit variance analysis
(continuing operations)
Cash operating profit - March 2008 R816.6 million
- volume increase 359.9 million
- working cost increase (107.9) million
- recovery grade reduction (51.2) million
- gold price reduction (22.3) million
- net variance 178.5 million
Cash operating profit - June 2008 R995.1 million
Analysis of earnings per share (continuing operations) (SA cents)
Quarter ended Quarter ended
Earnings per share June 2008 March 2008 FY08 FY07
Basic (loss)/earnings (60) 38 (199) 206
Headline earnings/(loss) 38 39 19 96
Fully diluted
(loss)/earnings (60) 38 (199) 204
Reconciliation between basic (loss)/earnings and headline earnings (continuing
operations)
Quarter ended Quarter ended
Headline earnings per share (cents) June 2008 March 2008
Basic (loss)/earnings (60) 38
Profit on sale of property, plant and
equipment 8 -
Loss on sale of joint venture 1 -
Impairment of investment in associates 24 -
Impairment of property, plant and equipment 39 -
Impairment of intangible assets 26 -
Provision for doubtful debt - 1
Headline earnings 38 39
Reconciliation between basic (loss)/earnings and headline earnings (continuing
operations)
Headline earnings per share (cents) FY08 FY07
Basic (loss)/earnings (199) 206
Profit on sale of property, plant and equipment - (32)
Loss on sale of listed investment 115 7
Loss on sale of joint venture 1 -
Profit on sale of associate - (56)
Impairment of investment in associates 24 -
Impairment/(Reversal of impairment) of property, plant and
equipment 39 (29)
Impairment of intangible assets 26 -
Provision for doubtful debt 13 -
Headline earnings 19 96
CAPITAL EXPENDITURE
Attributable capital expenditure incurred during 2008 totalled R3 647 million,
of which R1 428 million of this expenditure was incurred at the Hidden Valley
mine project in Papua New Guinea. It is anticipated that Hidden Valley will
require similar capex investment in the 2009 financial year. Harmony will,
however, only be responsible for a small portion of that commitment as our
joint venture partner Newcrest will cover the remaining requirements from
August 2008 as prescribed by Stage 2 of the partnership agreement.
Actual quarter Actual quarter
Operational Capex June 2008 March 2008
Rm Rm
South African Operations 470 346
Total Operational Capex 470 346
Capital
invested
Project Capex to date
Rm Rm Rm
Doornkop South Reef 87 79 956
Elandsrand New Mine 2 28 776
Tshepong Sub 66 Decline 5 6 289
Phakisa Shaft 84 62 866
Hidden Valley, PNG 668 324 2 049
Total Project Capex 846 499 4 936
Total Capex 1 316 845
Actual Actual
Operational Capex FY08 FY07
Rm Rm
South African operations 1 471 1 127
Surface operations
International operations
Total Operational Capex 1 471 1 127
Project Capex
Doornkop South Reef 328 238
Elandsrand New Mine 128 114
Tshepong North Decline 29 62
Phakisa Shaft 263 234
Hidden Valley PNG 1 428 526
Total Project Capex 2 176 1 174
Total Capex 3 647 2 301
QUARTERLY PROFIT COMPARISON FOR CONTINUING OPERATIONS
Operation Working profit (Rm)
June 2008 March 2008 Variance
SA underground operations 814.3 684.5 129.8
Surface operations 180.8 132.1 48.7
Total Harmony 995.1 816.6 178.5
Operation Variances (Rm)
Volume Grade Price Costs
SA underground operations 354.2 (103.4) (19.2) (101.8)
Surface operations 5.7 52.2 (3.1) (6.1)
Total Harmony 359.9 (51.2) (22.3) (107.9)
SOUTH AFRICAN UNDERGROUND OPERATIONS
Includes the following shafts: Tshepong, Phakisa, Doornkop, Elandsrand, Target,
Masimong, Evander, Bambanani, Joel, Virginia Operations.
June 2008 March 2008
U/g tonnes milled (`000) 2 283 1 934
U/g recovery grade (g/t) 4.55 4.81
U/g kilograms produced (kg) 10 396 9 302
U/g operating costs (R/kg) 145 808 152 026
U/g working costs (R/tonne) 664 731
Q-on-Q
% Variance June 2007
U/g tonnes milled (`000) 18.0 2 444
U/g recovery grade (g/t) (5.4) 4.79
U/g kilograms produced (kg) 11.8 11 708
U/g operating costs (R/kg) 4.1 152 336
U/g working costs (R/tonne) 9.2 730
Tshepong Mine
Production
Volumes at Tshepong improved by 21.2% quarter-on-quarter from 326 000 tonnes to
395 000 tonnes. This is in part attributed to the first full quarter of
operating on non-Conops.
Tshepong, however, recorded a disappointing 19% decrease in grade from 6.11g/t
to 4.95g/t due to a drop in face grade in the NW 2 and EN areas.
Costs were steady and, notwithstanding the added pressures of inflation, cash
operating costs were down by 1.0% quarter- on-quarter at R107 055/kg from R107
943/kg for the previous quarter.
The termination of Conops initially had a negative impact on productivity.
However, after the first full quarter of operating on non-Conops, the positive
effects on production levels and efficiency are evident.
Project overview
Sub 66 Decline Project overview
Sub 66 decline is currently in a production build-up phase. The project was
completed in June 2008 and all of the capital expended. An outstanding
engineering component of the project will be completed in the next financial
year.
Poor ground conditions in the 72-Belt x/c has required additional secondary
support and has delayed the equipping of the 72-Belt x/c. All the major
equipment has been procured and once the secondary support has been completed
the labour component will be employed to complete the engineering work.
Annual Capex profile
Table (Rm) 2003 2004 2005 2006
Actual Sunk 32.8 66.6 40.6 52.9
Forecast
Total 32.8 66.6 40.6 52.9
Table (Rm) 2007 2008 2009 Total
Actual Sunk 66.7 29.3 - 288.9
Forecast 2.9 2.9
Total 66.7 29.3 2.9 291.8
Full production
The Sub 66 decline has commenced production and will be in build-up phase
during the next two years when it will come into full production.
Sub 71 Decline Project Overview
A total of 1 089 metres has been developed. The material decline is 20%
complete, the chairlift 33% complete and 56% of the 73-level station has been
completed.
The project has experienced operational delays and high escalation cost over
the past year. It is also being constrained by a dearth of design and
engineering draughting work services countrywide.
Future milestones
* Construct and equip Sub 71 trackless workshop - September 2008
* Complete reaming of pilot-hole for Sub 71 ventilation - September 2008
* Complete manufacturing drawings for Sub 71 decline
conveyor - September 2008
Annual Capex profile
Table (Rm) 2008 2009 2010 Total
Actual Sunk 24.3 24.3
Forecast 60.9 32.7 93.6
Total 24.3 60.9 32.7 117.9
1st production
August 2012
Full production
July 2017
Schematic picture of production: Please see press.
Phakisa
Production
Volumes improved from 9 000 tonnes to 16 000 tonnes for the June 2008 quarter.
Gold production at Phakisa was 13.2% higher at 60kg from 53kg, but this
quarter`s lower grade extracted from Nyala shaft impacted on the overall gold
output. Grade decreased by 36.3% from 5.89g/t to 3.75g/t.
Grade variances will continue in future as most of the ore tonnages will be
from ore development and stoping in the Nyala shaft area. Build-up in face
availability at Phakisa shaft will take time and grade should be more
representative of the Phakisa orebody in two years` time.
Phakisa is in build-up production phase and consequently the mining mix will be
difficult to achieve until flexibility can be gained from the developed
reserve.
Project overview
A total of 6 895 metres of development was completed on 66, 69, 71, 73 and 75
levels.
The Rail-veyor was commissioned and cycle-times are improving. A second train
is scheduled for commissioning in September 2008. Phase 1 of the surface
infrastructure has been completed whilst the civil construction and erection of
main buildings have commenced.
Annual Capital expenditure profile
Table (Rm) 2004 2005 2006 2007 2008
Actual Sunk 117 116 147 222 263
Forecast
Total 117 116 147 222 263
Table (Rm) 2009 2010 2011 2012 Total
Actual Sunk 866
Forecast 330 76 46 30 482
Total 330 76 46 30 1 348
1st production
September 2008
Full production
June 2011
Future milestones
* Holing second raise line - August 2008
* First revenue from 69 level to commence - September 2008
* Start decline project (one year early) - November 2008
Doornkop
Production
Higher volumes milled from 74 000 tonnes to 126 000 tonnes and better recovery
grade, resulted in 86.4% improved production from 184kg to 343kgs. The recovery
was also 9.2% higher at 2.72g/t from 2.49g/t for the period under review.
Total costs at Doornkop were down by 50.2% at R148 157/kg compared with R297
293/kg. Costs for the quarter reflected an improvement in unit cost parameters
as well as cash operating costs. The higher costs incurred in the March quarter
are in part due to the low volumes milled as a result of the planned stoppage
to complete shaft work.
Doornkop`s Kimberley reef conventional section was stopped due to poor grade
being experienced. Contrary to this, the South Reef operations experienced an
increase in production with square metres mined improving 58% on the previous
quarter. Further improvements could be expected in the September quarter.
Project overview
Station development continues on 205 and 207 levels with a total of 3 061 cubic
metres excavated. Access development also continued on 192, 197 and 202 levels
with 288m excavated. Secondary development is also underway on 192 and 197
levels with 407m achieved.
Equipping of the loading station on 212 level is underway and is all that
remains of the shaft-sinking programme. Construction of the pump station and
loading levels is also underway following the completion of most of the
excavations on 205, 207 and 212 levels.
The updated schedule provides for the main shaft to be partially commissioned
by July 2008.
Annual Capital expenditure profile
Table (Rm) 2003 2004 2005 2006 2007 2008
Actual Sunk 13 98 114 147 256 328
Forecast
Total 13 98 114 147 256 328
Table (Rm) 2009 2010 2011 2012 Total
Actual Sunk 956
Forecast 271 267 109 31 678
Total 271 267 109 31 1 634
1st production
July 2007
Full production
July 2012
Future milestones
* Main shaft partially commissioned - July 2008
* Rock winder commissioned - November 2008
* Pump station on 207 level commissioned - November 2008
Elandsrand
Production
In the June quarter, tonnages milled at Elandsrand increased from 214 000
tonnes to 293 000 tonnes. Gold production was 44.6% higher at 1 540kgs compared
with 1 065kgs for the previous quarter. Recovery grade increased to 5.26g/t
from 4.98g/t; a 5.6% increase for the June 2008 quarter.
Cash operating costs were down by 14.8% to R134 961/kg from R158 494/kg for the
quarter under review.
A stringent cost control effort helped to reduce costs: plant costs decreased
and labour costs were lower due to the discontinuation of the Conops
allowances. Increases were, however, seen in stores, electricity and contractor
wages.
Project overview
The switchgear and cables for the 22 kV system to and from surface and 100
level was commissioned. We are currently waiting for Eskom to liven the
transformer at the Elandsrand Main sub-station. The installation of the 600mm
chilled water feed and return columns, connecting No. 2 and No. 3 Service
Shafts on 105 level, is progressing slowly. Additional sliping in the haulage
had to be completed to accommodate the columns where the haulage is too narrow.
The 115 L dam wall for No. 1 Settler was cast during the quarter and the
suction pipeline was installed between the dam and the pump station. The
infrastructure development of the 100 level cooling dam chamber is still being
rehabilitated with additional support following the major fall of ground of
December 2007. The Refrigeration Plant sub-station was blasted to size and
supported. The blasting of the 98 level`s condenser dam chamber was completed
during the quarter and the raise boring sites prepared to drill between 98 and
100 levels. The raise boring of the No. 3 centre hole was completed and
preparations done for the sinking of the sub-bank.
Development on 113 level progressed well during the quarter and the East RAW
reached the "End of Capital" position and now forms part of the mine`s "On
Going" development.
Annual Capital expenditure profile
Table (Rm) 2002 2003 2004 2005 2006 2007
Actual Sunk 107.0 106.2 105.5 96.1 119.6 113.7
Forecast
Total 107.0 106.2 105.5 96.1 119.6 113.7
Table (Rm) 2008 2009 2010 2011 Total
Actual Sunk 127.9 776.0
Forecast 133.3 81.5 13.4 228.2
Total 127.9 133.3 81.5 13.4 1 004.2
Project Production
Tonnes Milled % Split Kilograms % Split
Old Mine 136 989 47 736 46
New Mine 155 722 53 853 54
Total Mine 292 711 1 589
1st production
October 2003
Full production
June 2012
Future milestones
* 100 level, liven 22 kV sub-station complete - July 2008
* 115 level pump station commission - September 2008
* Access development on 113 level complete - January 2009
Target Mine
Target recorded an improved performance with a 2.6% increase in volumes from
154 000 tonnes to 158 000 tonnes. A 15.0% improvement in recovery grade from
3.67g/t to 4.22g/t lead to 101 more kilograms being produced from the 565kg
previously.
Notwithstanding a better performance, Target experienced water handling and
belt system delays at the beginning of the quarter. Fragmentation, crusher and
belt, as well as insufficient drill reserves, were additional challenges.
Cash operating costs were 13.2% up to R174 910/kg from R154 552/kg mainly due
to increases in fuel, trackless accessories and adjusted salaries mainly to
retain trackless specialised people.
Masimong Mine
Volumes at Masimong improved by 26.7% from 161 000 tonnes to 204 000 tonnes.
This is attributed to restructuring and people interventions leading to the
improved production level and higher efficiencies. Kilograms produced were up
by 15.1% at 886kg from 770kg.
Grade was 9.2% lower at 4.34g/t from 4.78g/t mainly due to lack of higher B
Reef grade availability.
Cash operating costs increased by 3.2% to R173 244/kg from R167 839/kg
previously. Increases were seen in electricity, stores and overtime to make up
for lost public holidays.
Evander Operations
At Evander tonnages milled increased by 7.9% quarter on quarter to 300 000
tonnes from 278 000 tonnes. Gold produced was 3.1% higher at 1 546kg compared
with 1 500kg for the previous quarter.
Grade was 4.6% lower at 5.15g/t compared with 5.40g/t in March mainly due to
Stoping width increasing in the 3 Decline areas.
Cost control initiatives have been implemented and this has begun to produce
results. Cash operating costs were 10.1% down to R128 616/kg versus R143
107/kg.
At Evander 8 shaft the fourth airway for additional ventilation was completed.
The support of the bottom 105m of the raise bore hole between 17 and 24.5
levels is complete and reaming is in progress. Seven cooling units in various
development ends and stopes have been installed to assist with the
environmental conditions.
Bambanani
A 15.3% reduction in volumes from 157 000 tonnes to 133 000 tonnes were
produced at Bambanani for the June 2008 quarter.
This was, however, offset by the 11.8% increase in recovery grade from 6.79g/t
to 7.59g/t, leading to only a 5.3% decrease in gold production from 1 066kg to
1 009kg.
The reduction in tonnages was ascribed to waste that was stored in the old
scaled ore pass for stability reasons.
The mine experienced a marked reduction in costs on the back of reduced volumes
and labour. Cash operating costs were 9.9% down at R142 959/kg from R158
595/kg.
Joel
Joel had an excellent June 2008 quarter. Volumes milled were up by 49.5% from
91 000 tonnes to 136 000 tonnes. Higher volumes and a steady grade of 4.50g/t
lead to a 46.4% increase in gold production of 612kg for the June quarter
compared with 418kg for the March 2008 quarter.
The excellent gold production contributed to the 24.5% reduction in cash
operating costs from R164 821/kg to R124 490/kg.
Virginia Operations
St Helena, Harmony, Merriespruit, Unisel, Brand
June 2008 March 2008
U/g tonnes milled (`000) 522 470
U/g recovery grade (g/t) 3.40 3.60
U/g kilograms produced (kg) 1 777 1 690
U/g working costs (R/kg) 197 366 171 209
U/g working costs (R/tonne) 672 616
Q-on-Q
% Variance June 2007
U/g tonnes milled (`000) 11.1 568
U/g recovery grade (g/t) (5.6) 3.82
U/g kilograms produced (kg) 5.2 2 166
U/g working costs (R/kg) (15.3) 177 564
U/g working costs (R/tonne) (9.1) 678
Although the Virginia Operations recorded an 11.1% improvement in tonnages
milled from 470 000 tonnes to 522 000 tonnes quarter-on-quarter was recorded,
it experienced a difficult quarter having to contend with labour go-slows and
several stoppages.
Grade was down by 5.6% mainly due to poorer grades at Unisel, Brand 3 and
Harmony 2 shafts. Gold production increased by 5.2% due to higher tonnages
milled from 1 690kg to 1 777kg.
Cash operating costs were 15.3% higher at R197 366/kg from R171 209/kg. This is
ascribed to electricity increases and stores.
SOUTH AFRICAN SURFACE OPERATIONS
Kalgold, Phoenix, Free Gold surface and Target surface
June 2008 March 2008
Surface tonnes milled (`000) 2 251 2 191
Surface recovery grade (g/t) 0.58 0.48
Kilograms produced (kg) 1 298 1 045
Working costs (R/kg) 83 935 98 504
Working costs (R/tonne) 48 47
Q-on-Q
% Variance June 2007
Surface tonnes milled (`000) 2.7 1 202
Surface recovery grade (g/t) 20.8 0.59
Kilograms produced (kg) 24.2 706
Working costs (R/kg) 14.8 100 313
Working costs (R/tonne) (2.1) 59
Kalgold
Tons milled were slightly down by 1.3% at 384 000 tonnes from 389 000 tonnes.
This is mainly due to lost production from unforeseen breakdowns, lower milling
rates and four days of delays caused by rain.
Grade decreased by 9.6% from 1.87g/t to 1.69g/t quarter-on-quarter mainly
because of lower grade ore from other pits.
However, grade from the D-zone - the main source of ore - was higher at 2.81g/t.
D-zone will continue to be the main source of ore until the first quarter of
the 2009 calendar year when it is likely to be replaced by other pits.
Gold production was 10.9% lower due to lower volumes milled and lower
recoveries from the plant. Kalgold produced 649kg for the June 2008 quarter
versus 728kg for the March 2008 quarter.
Cash operating costs were slightly up from R97 636/kg to R98 076/kg. Increases
were seen in steel, reagents, lime and machinery spares.
Project Phoenix
Phoenix produced another quarter of consistent results. Tonnage throughput
through the plant was marginally down by 0.3% from 1 591 000 tonnes to 1 587
000 tonnes, but a 7.7% higher grade of 0.14g/t (0.13g/t) resulted in gold
production being up by 5.2% at 224kg from 213kg previously.
Costs were up 12.5% from R94 197/kg to R106 000/kg as a result of increases in
consumables such as reagents.
INTERNATIONAL OPERATIONS
Hidden Valley
Project overview
Highlights for the June quarter were the concrete pouring for the SAG mill-base
and the two middle sections of the SAG mill which are completed and ready for
shipping from Czech Republic. With regards to mining operations, total waste
moved was 16% above budget whilst the total ore movement was below budget
having been affected by road transport and accessibility challenges. Some 535m
of grade control drilling was completed at Hamata and results indicate
continuity of ore lodes identified in the resource model.
The execution of the design and fabrication of the overland conveyor remains a
critical issue. The detailed design of the conveyor is progressing well but is
dependent on the rapid ramp up of the fabrication activities. The shortage of
civils and contract labour resources is proving to be a challenge.
Annual Capex Expenditure Profile (Construction Capital : Cash Flow)
Table (A$m) 2006 2007 2008 2009
Actual Sunk 20 90 181
Forecast 314
Total 20 90 181 314
Table (A$m) 2010 2011 2012 2013 Total
Actual Sunk 291
Forecast 314
Total 605
Following the announcement of Newcrest acquiring an interest in Harmony`s PNG
exploration and mining assets, the joint venture partners undertook a detailed
review of the capital cost estimate and construction schedule for the Hidden
Valley project. The review confirmed the expected commissioning of Hidden
Valley in mid-2009.
The capital cost estimate has increased to around A$605 million. This is
materially in line with the estimate used by Newcrest when it entered the joint
venture.
Engineering design is 91% complete, procurement is 87% complete with the
overall project 57% complete.
DISCONTINUED OPERATIONS
Cooke Plant Operations
Cooke plant experienced several challenges during the June quarter, mainly
insufficient rail trucks and waste rock depletion.
Volumes decreased quarter-on-quarter from 645 000 tonnes to 525 000 tonnes.
Recovery grade was down due to the depletion of waste rock and the use of
low-grade waste as grinding media. Grade was lower at 0.40g/t from 0.43g/t
previously, resulting in fewer kilograms produced from 275kg to 212kg. Cash
operating costs were up by 11.2% due to the introduction of road transport and
the increases in fuel prices.
The implementation of Dump 20 project, comprising a pipeline from Dump 20 to
Cooke plant, required the stopping of mills 1 and 2 for conversion to ball
mills.
Randfontein Operations
Randfontein`s Cooke 3 shaft experienced two fatalities during the June 2008
quarter.
Volumes from Randfontein`s three shafts increased by 5.8% from 277 000 tonnes
to 293 000 tonnes.
Gold production was marginally lower at 1 349kg from 1 354kg previously, due to
lower recovery grade which dropped by 5.9% from 4.89g/t to 4.60g/t.
Cash operating costs for the June 2008 quarter were well-contained at R120
173/kg from R136 157/kg; a decrease of 11.7%.
The shafts, nevertheless, experienced cost increases in electricity and diesel.
EXPLORATION
Wafi-Golpu
Project Overview
Harmony`s exploration activities carried out during the June 2008 quarter
amounted to R62 million. Exploration activities occurred mostly in Papua New
Guinea across a range of greenfield and brownfield targets.
The Wafi-Golpu exploration tenements have been a large focus area with
exploration occurring on four potential copper gold porphyry deposits. These
prospects include Nambonga North, Ghavembu, Kesiago and Biamena.
On the Morobe Consolidated Goldfields tenements work was mostly targeting high
grade gold resources. These included prospect areas at Daulo, Kerimenge and
Salemba, all located within a 6km radius of the Hidden Valley ML.
Exploration results and programme
Wafi-Golpu
Wafi "Near Mine" (Brownfields)
Nambonga North
Exploration continued at Nambonga North with four drill rigs. Drilling
activities were focused on testing strike and depth extensions of the porphyry
copper-gold system and the adjacent polymetallic sulphide lode. To date
mineralisation remains open at depth and along strike. New results received
during the quarter include:
Porphyry Cu-Au intercepts:
* WR275: 180m @ 1.0 g/t Au, 0.25% Cu from 383m
Au-Zn-Pb-Ag Massive Sulphide intercepts:
* WR273: 11m @ 5.0 g/t Au 3.8% Zn, 1.2% Pb and 14 g/t Agf rom 201m
Nambonga North has the potential to develop into a new multi-million ounce gold
resource (with additional copper and other base metal credits) for the
Wafi-Golpu Project. Drilling to scope-out the deposit will remain a priority.
Wafi Greenfields
Ghavembu prospect (previously Awembu)
Similar to Nambonga North, the target has excellent porphyry Au-Cu potential
that could impact significantly on the value of the project. Drill pads for the
two proposed holes were completed and await drill rigs. Initial drilling is
scheduled as drill units become available from Nambonga North.
Biamena prospect
A ground-based electromagnetic survey was designed for the Biamena Prospect to
outline drill targets for porphyries hidden at depth (similar to Golpu). About
37.5 line km (40%) has been completed to date.
A programme of grid based soils, mapping, and selective rock chip sampling
commenced in conjunction with the EM survey.
These datasets will be used to interpret IP and EM results and rank drill
targets. Results have been highly encouraging with rock chip values received up
to 64 g/t.
Kesiago prospect
A fly camp was established for a planned work programme of surface mapping and
sampling and drilling. The programme is scheduled to commence Q1 FY09.
Morobe Consolidated Tenements
* Daulo prospect. 11 trenches were remapped and selectively re-sampled to
validate historical results. Intercepts from this work included
DLO 1A 10.8m @ 5.35 g/t Au
DLO3A 45m @ 4.6 g/t Au
DLO4B 23m @ 2.2 g/t Au
Mineralisation appears fault bounded. Mapping shows the majority of minor
structures exposed in the trenches are oriented similar to Edie Creek, dipping
60 to 70 degrees to the south-east.
The work has highlighted good potential for shallow high-grade oxide within a
6km radius of the Hidden Valley Plant.
A proposal for follow-up drilling to test the size potential of the prospect is
underway.
* Kerimenge prospect
Results received from trenching activities during the quarter include:
KTK03A 16m @ 3.2 g/t Au 4m @ 22.5 g/t Au 4m @ 8.23 g/t Au
KTK03B 8m @ 5.7 g/t Au 12m @ 3.88 g/t Au
The trenching was completed east of the Kerimenge Deposit in an area where no
previous work has been undertaken and form part of the same zone as KTK02
results reported last quarter. These results appear associated with Northwest
trending shear zone which has been intruded by porphyry. To date trenching has
outlined the structure over approximately 300m of strike and is open to the
south.
Hidden Valley ML 151 Exploration
Work on the Hidden Valley ML included diamond drilling at the Salemba Prospect.
The drilling was undertaken to test a magnetic target with anomalous coincident
Au-Mo-Cu geochemistry. Core processing and sampling is in progress.
FINANCIAL REVIEW FOR THE FOURTH QUARTER AND
YEAR ENDED 30 JUNE 2008
OPERATING RESULTS - CONTINUING OPERATIONS (Rand/Metric)
Underground production - South Africa
Doorn-
Tshepong Phakisa kop
Ore Milled - t`000 Jun-08 395 16 126
Mar-08 326 9 74
Gold Produced - kg Jun-08 1 957 60 343
Mar-08 1 991 53 184
Yield - g/tonne Jun-08 4.95 3.75 2.72
Mar-08 6.11 5.89 2.49
Cash Operating
Costs - R/kg Jun-08 107 055 127 983 148 157
Mar-08 107 943 108 811 297 293
Cash Operating
Costs - R/tonne Jun-08 530 480 403
Mar-08 659 641 739
Working Revenue (R`000) Jun-08 438 170 13 449 76 808
Mar-08 444 818 11 835 42 519
Cash Operating
Costs (R`000) Jun-08 209 506 7 679 50 818
Mar-08 214 915 5 767 54 702
Cash Operating
Profit (R`000) Jun-08 228 664 5 770 25 990
Mar-08 229 903 6 068 (12 183)
Capital
Expenditure (R`000) Jun-08 50 018 97 022 100 247
Mar-08 43 137 73 207 83 518
Elands-
rand Target Masimong
Ore Milled - t`000 Jun-08 293 158 204
Mar-08 214 154 161
Gold Produced - kg Jun-08 1 540 666 886
Mar-08 1 065 565 770
Yield - g/tonne Jun-08 5.26 4.22 4.34
Mar-08 4.98 3.67 4.78
Cash Operating
Costs - R/kg Jun-08 134 961 174 910 173 244
Mar-08 158 494 154 552 167 839
Cash Operating
Costs - R/tonne Jun-08 709 737 752
Mar-08 789 567 803
Working Revenue (R`000) Jun-08 346 827 148 605 198 795
Mar-08 245 789 125 572 173 674
Cash Operating
Costs (R`000) Jun-08 207 840 116 490 153 494
Mar-08 168 796 87 322 129 236
Cash Operating
Profit (R`000) Jun-08 138 987 32 115 45 301
Mar-08 76 993 38 250 44 438
Capital
Expenditure (R`000) Jun-08 95 141 91 410 26 049
Mar-08 83 221 81 434 25 272
Evander
Operations Bambanani Joel
Ore Milled - t`000 Jun-08 300 133 136
Mar-08 278 157 91
Gold Produced - kg Jun-08 1 546 1 009 612
Mar-08 1 500 1 066 418
Yield - g/tonne Jun-08 5.15 7.59 4.50
Mar-08 5.40 6.79 4.59
Cash
Operating
Costs - R/kg Jun-08 128 616 142 959 124 490
Mar-08 143 107 158 595 164 821
Cash
Operating
Costs - R/tonne Jun-08 663 1 085 560
Mar-08 772 1 077 757
Working
Revenue (R`000) Jun-08 346 022 225 877 137 109
Mar-08 341 845 234 233 95 065
Cash
Operating
Costs (R`000) Jun-08 198 840 144 246 76 188
Mar-08 214 660 169 062 68 895
Cash
Operating
Profit (R`000) Jun-08 147 182 81 631 60 921
Mar-08 127 185 65 171 26 170
Capital
Expenditure (R`000) Jun-08 55 808 22 028 8 954
Mar-08 53 291 21 502 8 392
Total SA
Virginia Under-
Operations St Helena ground
Ore Milled - t`000 Jun-08 522 - 2 283
Mar-08 470 - 1 934
Gold
Produced - kg Jun-08 1 777 - 10 396
Mar-08 1 690 - 9 302
Yield - g/tonne Jun-08 3.40 - 4.55
Mar-08 3.60 - 4.81
Cash
Operating
Costs - R/kg Jun-08 197 366 - 145 808
Mar-08 171 209 - 152 026
Cash
Operating
Costs - R/tonne Jun-08 672 - 664
Mar-08 616 - 731
Working
Revenue (R`000) Jun-08 398 504 - 2 330 166
Mar-08 383 269 26 2 098 645
Cash
Operating
Costs (R`000) Jun-08 350 719 - 1 515 820
Mar-08 289 343 11 445 1 414 143
Cash
Operating
Profit (R`000) Jun-08 47 785 - 814 346
Mar-08 93 926 (11 419) 684 502
Capital
Expenditure (R`000) Jun-08 41 078 6 587 761
Mar-08 28 594 167 501 735
Surface production - South Africa
Kalgold Project
Surface Phoenix
Ore Milled - t`000 Jun-08 384 1 587
Mar-08 389 1 591
Gold Produced - kg Jun-08 649 224
Mar-08 728 213
Yield - g/tonne Jun-08 1.69 0.14
Mar-08 1.87 0.13
Cash Operating Costs - R/kg Jun-08 98 076 106 000
Mar-08 97 636 94 197
Cash Operating Costs - R/tonne Jun-08 166 15
Mar-08 183 13
Working Revenue (R`000) Jun-08 145 571 50 382
Mar-08 162 831 48 593
Cash Operating Costs (R`000) Jun-08 63 651 23 744
Mar-08 71 079 20 064
Cash Operating Profit (R`000) Jun-08 81 920 26 638
Mar-08 91 752 28 529
Capital Expenditure (R`000) Jun-08 4 822 194
Mar-08 903 354
Other Total SA
Surface Surface
Ore Milled - t`000 Jun-08 280 2 251
Mar-08 211 2 191
Gold Produced - kg Jun-08 425 1 298
Mar-08 104 1 045
Yield - g/tonne Jun-08 1.52 0.58
Mar-08 0.49 0.48
Cash Operating Costs - R/kg Jun-08 50 711 83 935
Mar-08 113 404 98 504
Cash Operating Costs - R/tonne Jun-08 77 48
Mar-08 56 47
Working Revenue (R`000) Jun-08 93 760 289 713
Mar-08 23 631 235 055
Cash Operating Costs (R`000) Jun-08 21 552 108 947
Mar-08 11 794 102 937
Cash Operating Profit (R`000) Jun-08 72 208 180 766
Mar-08 11 837 132 118
Capital Expenditure (R`000) Jun-08 55 092 60 108
Mar-08 18 185 19 442
South International
Africa production Harmony
Total PNG Total
Ore
Milled - t`000 Jun-08 4 534 - 4 534
Mar-08 4 125 - 4 125
Gold
Produced - kg Jun-08 11 694 - 11 694
Mar-08 10 347 - 10 347
Yield - g/tonne Jun-08 2.58 - 2.58
Mar-08 2.51 - 2.51
Cash
Operating
Costs - R/kg Jun-08 138 940 - 138 940
Mar-08 146 620 - 146 620
Cash
Operating
Costs - R/tonne Jun-08 358 - 358
Mar-08 368 - 368
Working
Revenue (R`000) Jun-08 2 619 879 - 2 619 879
Mar-08 2 333 700 - 2 333 700
Cash
Operating
Costs (R`000) Jun-08 1 624 767 - 1 624 767
Mar-08 1 517 080 - 1 517 080
Cash
Operating
Profit (R`000) Jun-08 995 112 - 995 112
Mar-08 816 620 - 816 620
Capital
Expenditure
(R`000) Jun-08 647 869 668 028 1 315 897
Mar-08 521 177 324 228 845 405
Evander operations - Evander 5, Evander 7 and Evander 8
Virginia operations - Harmony 2, Merriespruit 1 and 3, Unisel and Brand
OPERATING RESULTS INCLUDING DISCONTINUED OPERATIONS (Rand/Metric)
Underground production - South Africa
Doorn-
Tshepong Phakisa kop
Ore Milled - t`000 Jun-08 395 16 126
Mar-08 326 9 74
Gold Produced - kg Jun-08 1 957 60 343
Mar-08 1 991 53 184
Yield - g/tonne Jun-08 4.95 3.75 2.72
Mar-08 6.11 5.89 2.49
Cash Operating
Costs - R/kg Jun-08 107 055 127 983 148 157
Mar-08 107 943 108 811 297 293
Cash Operating
Costs - R/tonne Jun-08 530 480 403
Mar-08 659 641 739
Working Revenue (R`000) Jun-08 438 170 13 449 76 808
Mar-08 444 818 11 835 42 519
Cash Operating
Costs (R`000) Jun-08 209 506 7 679 50 818
Mar-08 214 915 5 767 54 702
Cash Operating
Profit (R`000) Jun-08 228 664 5 770 25 990
Mar-08 229 903 6 068 (12 183)
Capital
Expenditure (R`000) Jun-08 50 018 97 022 100 247
Mar-08 43 137 73 207 83 518
Elands-
rand Target Masimong
Ore Milled - t`000 Jun-08 293 158 204
Mar-08 214 154 161
Gold Produced - kg Jun-08 1 540 666 886
Mar-08 1 065 565 770
Yield - g/tonne Jun-08 5.26 4.22 4.34
Mar-08 4.98 3.67 4.78
Cash Operating
Costs - R/kg Jun-08 134 961 174 910 173 244
Mar-08 158 494 154 552 167 839
Cash Operating
Costs - R/tonne Jun-08 709 737 752
Mar-08 789 567 803
Working Revenue (R`000) Jun-08 346 827 148 605 198 795
Mar-08 245 789 125 572 173 674
Cash Operating
Costs (R`000) Jun-08 207 840 116 490 153 494
Mar-08 168 796 87 322 129 236
Cash Operating
Profit (R`000) Jun-08 138 987 32 115 45 301
Mar-08 76 993 38 250 44 438
Capital
Expenditure (R`000) Jun-08 95 141 91 410 26 049
Mar-08 83 221 81 434 25 272
Rand-
Evander fontein Bamba-
Operations Operations nani
Ore Milled - t`000 Jun-08 300 293 133
Mar-08 278 277 157
Gold Produced- kg Jun-08 1 546 1 349 1 009
Mar-08 1 500 1 354 1 066
Yield - g/tonne Jun-08 5.15 4.60 7.59
Mar-08 5.40 4.89 6.79
Cash
Operating
Costs - R/kg Jun-08 128 616 120 173 142 959
Mar-08 143 107 136 157 158 595
Cash
Operating
Costs - R/tonne Jun-08 663 553 1 085
Mar-08 772 666 1 077
Working
Revenue (R`000) Jun-08 346 022 302 758 225 877
Mar-08 341 845 312 068 234 233
Cash
Operating
Costs (R`000) Jun-08 198 840 162 114 144 246
Mar-08 214 660 184 357 169 062
Cash
Operating
Profit (R`000) Jun-08 147 182 140 644 81 631
Mar-08 127 185 127 711 65 171
Capital
Expenditure (R`000) Jun-08 55 808 40 985 22 028
Mar-08 53 291 40 119 21 502
Virginia
Opera-
Joel tions St Helena
Ore Milled - t`000 Jun-08 136 522 -
Mar-08 91 470 -
Gold Produced - kg Jun-08 612 1 777 -
Mar-08 418 1 690 -
Yield - g/tonne Jun-08 4.50 3.40 -
Mar-08 4.59 3.60 -
Cash Operating
Costs - R/kg Jun-08 124 490 197 366 -
Mar-08 164 821 171 209 -
Cash Operating
Costs - R/tonne Jun-08 560 672 -
Mar-08 757 616 -
Working Revenue (R`000) Jun-08 137 109 398 504 -
Mar-08 95 065 383 269 26
Cash Operating
Costs (R`000) Jun-08 76 188 350 719 -
Mar-08 68 895 289 343 11 445
Cash Operating
Profit (R`000) Jun-08 60 921 47 785 -
Mar-08 26 170 93 926 (11 419)
Capital
Expenditure (R`000) Jun-08 8 954 41 078 6
Mar-08 8 392 28 594 167
Total SA
Under-
ARMgold ground
Ore Milled - t`000 Jun-08 - 2 576
Mar-08 108 2 319
Gold Produced - kg Jun-08 - 11 745
Mar-08 300 10 956
Yield - g/tonne Jun-08 - 4.56
Mar-08 2.78 4.72
Cash Operating Costs - R/kg Jun-08 - 142 895
Mar-08 321 143 154 695
Cash Operating Costs - R/tonne Jun-08 - 652
Mar-08 892 731
Working Revenue (R`000) Jun-08 - 2 632 924
Mar-08 68 682 2 479 395
Cash Operating Costs (R`000) Jun-08 367 1 678 301
Mar-08 96 343 1 694 843
Cash Operating Profit (R`000) Jun-08 (367) 954 623
Mar-08 (27 661) 784 552
Capital Expenditure (R`000) Jun-08 (72) 628 674
Mar-08 (8) 541 846
Surface production - South Africa
Cooke
Kalgold Project plant
Surface Phoenix Operations
Ore Milled - t`000 Jun-08 384 1 587 525
Mar-08 389 1 591 645
Gold Produced - kg Jun-08 649 224 212
Mar-08 728 213 275
Yield - g/tonne Jun-08 1.69 0.14 0.40
Mar-08 1.87 0.13 0.43
Cash Operating Costs - R/kg Jun-08 98 076 106 000 158 769
Mar-08 97 636 94 197 142 822
Cash Operating Costs - R/tonne Jun-08 166 15 64
Mar-08 183 13 61
Working Revenue (R`000) Jun-08 145 571 50 382 47 450
Mar-08 162 831 48 593 62 497
Cash Operating Costs (R`000) Jun-08 63 651 23 744 33 659
Mar-08 71 079 20 064 39 276
Cash Operating Profit (R`000) Jun-08 81 920 26 638 13 791
Mar-08 91 752 28 529 23 221
Capital Expenditure (R`000) Jun-08 4 822 194 1 090
Mar-08 903 354 1 886
South
Other Total SA Africa
Surface Surface Total
Ore Milled - t`000 Jun-08 280 2 776 5 352
Mar-08 211 2 836 5 155
Gold Produced - kg Jun-08 425 1 510 13 255
Mar-08 104 1 320 12 276
Yield - g/tonne Jun-08 1.52 0.54 2.48
Mar-08 0.49 0.47 2.38
Cash Operating Costs - R/kg Jun-08 50 711 94 441 137 375
Mar-08 113 404 107 737 149 646
Cash Operating Costs - R/tonne Jun-08 77 51 340
Mar-08 56 50 356
Working Revenue (R`000) Jun-08 93 760 337 163 2 970 087
Mar-08 23 631 297 552 2 776 947
Cash Operating Costs (R`000) Jun-08 21 552 142 606 1 820 907
Mar-08 11 794 142 213 1 837 056
Cash Operating Profit (R`000) Jun-08 72 208 194 557 1 149 180
Mar-08 11 837 155 339 939 891
Capital Expenditure (R`000) Jun-08 55 092 61 198 689 872
Mar-08 18 185 21 328 563 174
International production
Australia PNG
Ore Milled - t`000 Jun-08 - -
Mar-08 34 -
Gold Produced - kg Jun-08 - -
Mar-08 56 -
Yield - g/tonne Jun-08 - -
Mar-08 1.65 -
Cash Operating Costs - R/kg Jun-08 - -
Mar-08 510 875 -
Cash Operating Costs - R/tonne Jun-08 - -
Mar-08 841 -
Working Revenue (R`000) Jun-08 - -
Mar-08 29 815 -
Cash Operating Costs (R`000) Jun-08 - -
Mar-08 28 609 -
Cash Operating Profit (R`000) Jun-08 - -
Mar-08 1 206 -
Capital Expenditure (R`000) Jun-08 277 668 028
Mar-08 61 324 228
Total
Inter- Harmony
national Total
Ore Milled - t`000 Jun-08 - 5 352
Mar-08 34 5 189
Gold Produced - kg Jun-08 - 13 255
Mar-08 56 12 332
Yield - g/tonne Jun-08 - 2.48
Mar-08 1.65 2.38
Cash Operating Costs - R/kg Jun-08 - 137 375
Mar-08 510 875 151 286
Cash Operating Costs - R/tonne Jun-08 - 340
Mar-08 841 360
Working Revenue (R`000) Jun-08 - 2 970 087
Mar-08 29 815 2 806 762
Cash Operating Costs (R`000) Jun-08 - 1 820 907
Mar-08 28 609 1 865 665
Cash Operating Profit (R`000) Jun-08 - 1 149 180
Mar-08 1 206 941 097
Capital Expenditure (R`000) Jun-08 668 305 1 358 177
Mar-08 324 289 887 463
Evander operations - Evander 5, Evander 7 and Evander 8
Randfontein operations - Cooke 1, Cooke 2 and Cooke 3
Virginia operations - Harmony 2, Merriespruit 1 and 3, Unisel and Brand
CONDENSED CONSOLIDATED INCOME STATEMENT (Rand)
Quarter ended
June March June(1)
2008 2008 2007
Notes (Unaudited) (Unaudited) (Unaudited)
R million R million R million
Continuing operations
Revenue 2 620 2 334 1 880
Cost of sales 2 (2 284) (1 820) (1 928)
Production cost (1 625) (1 517) (1 855)
Amortisation and
depreciation (222) (189) (214)
Impairment of assets (316) - 123
Employment
termination and
restructuring costs (50) (86) -
Other items (71) (28) 18
Gross profit/(loss) 336 514 (48)
Corporate,
administration and
other expenditure (49) (55) (84)
Exploration
expenditure (62) (55) (83)
Other
(expenses)/income -
net (9) (16) 75
Operating
profit/(loss) 216 388 (140)
Loss from associates (68) (10) (1)
Profit on sale of
investment in
associate - - -
Impairment of
investment in
associate (95) - -
Loss on sale of
investment in joint
venture (2) - -
Mark-to-market of
listed investments - - 31
Loss on sale of
listed investments - - (37)
Impairment of
investments (1) - -
Investment income 86 54 85
Finance cost (131) (123) (195)
Profit/(Loss) before
taxation 5 309 (257)
Taxation (246) (156) 84
Net (loss)/profit
from continuing
operations (241) 153 (173)
Discontinued
operations 3
Profit/(Loss) from
discontinued
operations 170 192 (463)
Net (loss)/profit (71) 345 (636)
(Loss)/Earnings per
share from continuing
operations
attributable to the
equity holders
of the Company during
the year (cents) 4
- Basic
(loss)/earnings (60) 38 (43)
- Headline
earnings/(loss) 38 39 (81)
- Fully diluted
(loss)/earnings (60) 38 (43)
Earnings/(Loss) per
share from
discontinuing
operations
attributable to the
equity holders
of the Company during
the year (cents) 4
- Basic
earnings/(loss) 42 48 (116)
- Headline
earnings/(loss) 27 24 (48)
- Fully diluted
earnings/(loss) 42 48 (116)
Total (loss)/earnings
per share from all
operations
attributable to the
equity holders
of the Company during
the year (cents) 4
- Basic
(loss)/earnings (18) 86 (159)
- Headline
earnings/(loss) 65 63 (129)
- Fully diluted
(loss)/earnings (18) 86 (159)
Year ended
June June(1)
2008 2007
R million R million
Continuing operations
Revenue 9 210 8 037
Cost of sales (8 184) (6 729)
Production cost (6 673) (6 021)
Amortisation and depreciation (846) (763)
Impairment of assets (316) 123
Employment termination and restructuring costs (212) -
Other items (137) (68)
Gross profit/(loss) 1 026 1 308
Corporate, administration and other expenditure (228) (226)
Exploration expenditure (205) (194)
Other (expenses)/income - net (90) 186
Operating profit/(loss) 503 1 074
Loss from associates (78) (19)
Profit on sale of investment in associate - 236
Impairment of investment in associate (95) -
Loss on sale of investment in joint venture (2) -
Mark-to-market of listed investments 33 111
Loss on sale of listed investments (459) (35)
Impairment of investments (1) (10)
Investment income 282 188
Finance cost (514) (454)
Profit/(Loss) before taxation (331) 1 091
Taxation (465) (271)
Net (loss)/profit from continuing operations (796) 820
Discontinued operations
Profit/(Loss) from discontinued operations 551 (438)
Net (loss)/profit (245) 382
(Loss)/Earnings per share from continuing
operations attributable to the equity holders
of the Company during the year (cents)
- Basic (loss)/earnings (199) 206
- Headline earnings/(loss) 19 96
- Fully diluted (loss)/earnings (199) 204
Earnings/(Loss) per share from discontinuing
operations attributable to the equity holders
of the Company during the year (cents)
- Basic earnings/(loss) 137 (110)
- Headline earnings/(loss) 108 (43)
- Fully diluted earnings/(loss) 137 (110)
Total (loss)/earnings per share from all
operations attributable to the equity holders
of the Company during the year (cents)
- Basic (loss)/earnings (62) 96
- Headline earnings/(loss) 127 53
- Fully diluted (loss)/earnings (62) 94
1 The comparative figures were adjusted to exclude further discontinued
operations and interest capitalised.
CONDENSED CONSOLIDATED BALANCE SHEET (Rand)
At At At
June March June
2008 2008 2007
Notes (Unaudited)
R million R million R million
ASSETS
Non-current assets
Property, plant and
equipment 27 556 26 575 24 538
Intangible assets 2 209 2 309 2 307
Restricted cash 78 80 5
Restricted investments 5 1 465 1 304 1 373
Investments in
financial assets 6 67 109 14
Investments in
associates 7 145 341 7
Trade and other
receivables 137 7 95
31 657 30 725 28 339
Current assets
Inventories 693 654 742
Investments in
financial assets 6 - - 2 484
Trade and other
receivables 873 993 918
Income and mining
taxes 82 58 66
Restricted cash - - 274
Cash and cash
equivalents 9 413 346 711
2 061 2 051 5 195
Non-current assets
classified as held
for sale 3 1 539 1 716 1 284
3 600 3 767 6 479
Total assets 35 257 34 492 34 818
EQUITY AND LIABILITIES
Share capital and
reserves
Share capital 25 895 25 866 25 636
Other reserves 676 731 (349)
Accumulated loss (1 832) (1 779) (1 581)
24 739 24 818 23 706
Non-current
liabilities
Borrowings 8 264 1 918 1 743
Deferred income tax 2 990 2 599 2 719
Provisions for other
liabilities and
charges 1 273 1 078 1 216
4 527 5 595 5 678
Current liabilities
Trade and other
payables 1 372 923 1 545
Provisions and
accrued liabilities 287 261 267
Borrowings 8 3 835 2 009 2 855
Bank overdraft 9 - - 220
5 494 3 193 4 887
Liabilities directly
associated with
non-current assets
classified as held
for sale 3 497 886 547
5 991 4 079 5 434
Total equity and
liabilities 35 257 34 492 34 818
Number of ordinary
shares in issue 403 253 756 402 818 020 399 608 384
Net asset value per
share (cents) 6 135 6 161 5 932
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (Rand)
Issued share Other
capital reserves
R million R million
Balance - 30 June 2007 (as previously reported) 25 636 (349)
Change in accounting policy for the
capitalisation of
interest on assets under construction - -
Balance - 30 June 2007 (restated) 25 636 (349)
Issue of share capital 259 -
Currency translation adjustment and other - 1 025
Net loss - -
Dividends paid - -
Balance as at 30 June 2008 25 895 676
Balance - 30 June 2006 (as previously reported) 25 489 (271)
Change in accounting policy for the
capitalisation of
interest on assets under construction - -
Balance - 30 June 2006 (restated) 25 489 (271)
Issue of share capital 147 -
Currency translation adjustment and other - (78)
Net profit - -
Dividends paid - -
Balance as at 30 June 2007 25 636 (349)
Accumulated
loss Total
R million R million
Balance - 30 June 2007 (as previously reported) (1 681) 23 606
Change in accounting policy for the
capitalisation of
interest on assets under construction 100 100
Balance - 30 June 2007 (restated) (1 581) 23 706
Issue of share capital - 259
Currency translation adjustment and other - 1 025
Net loss (245) (245)
Dividends paid (6) (6)
Balance as at 30 June 2008 (1 832) 24 739
Balance - 30 June 2006 (as previously reported) (2 015) 23 203
Change in accounting policy for the
capitalisation of
interest on assets under construction 59 59
Balance - 30 June 2006 (restated) (1 956) 23 262
Issue of share capital - 147
Currency translation adjustment and other - (78)
Net profit 382 382
Dividends paid (7) (7)
Balance as at 30 June 2007 (1 581) 23 706
CONDENSED CONSOLIDATED CASH FLOW STATEMENT (Rand)
Quarter ended
June March
2008 2008
Notes (Unaudited) (Unaudited)
R million R million
Cash flow from operating activities
Cash generated by operations 1 506 794
Interest and dividends received 97 64
Interest paid (117) (123)
Income and mining taxes paid (67) (41)
Cash generated by operating activities 1 419 694
Cash flow from investing activities
(Increase)/decrease in restricted cash 2 1
Net proceeds on disposal of listed
investments - -
Net additions to property, plant and
equipment (1 267) (884)
Other investing activities (190) 6
Cash utilised by investing activities (1 455) (877)
Cash flow from financing activities
Long-term loans raised 8 136 -
Long-term loans repaid 8 (12) (6)
Ordinary shares issued - net of
expenses 23 40
Dividends paid (6) -
Cash generated by financing activities 141 34
Foreign currency translation
adjustments (38) 62
Net increase/(decrease) in cash and
equivalents 67 (87)
Cash and equivalents - beginning of
period 348 435
Cash and equivalents - end of period 9 415 348
Year ended
June June
2008 2007
R million R million
Cash flow from operating activities
Cash generated by operations 1 978 1 221
Interest and dividends received 306 204
Interest paid (417) (226)
Income and mining taxes paid (129) (13)
Cash generated by operating activities 1 738 1 186
Cash flow from investing activities
(Increase)/decrease in restricted cash 205 (29)
Net proceeds on disposal of listed investments 1 310 395
Net additions to property, plant and equipment (3 718) (2 549)
Other investing activities (170) (45)
Cash utilised by investing activities (2 373) (2 228)
Cash flow from financing activities
Long-term loans raised 2 234 1 804
Long-term loans repaid (1 820) (1 002)
Ordinary shares issued - net of expenses 87 138
Dividends paid (6) (7)
Cash generated by financing activities 495 933
Foreign currency translation adjustments 61 (48)
Net increase/(decrease) in cash and equivalents (79) (157)
Cash and equivalents - beginning of period 494 651
Cash and equivalents - end of period 415 494
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE QUARTER AND YEAR ENDED 30 JUNE 2008
1. Accounting policies
(a) Basis of accounting
The condensed consolidated interim financial statements for the period ended 30
June 2008 have been prepared using accounting policies that comply with
International Financial Reporting Standards (IFRS), which are consistent with
the accounting policies used in the audited annual financial statements for the
year ended 30 June 2007, except for accounting policy changes made after the
date of the annual financial statements. These condensed consolidated interim
financial statements are prepared in accordance with IAS 34, Interim Financial
Reporting, and should be read in conjunction with the financial statements for
the year ended 30 June 2007.
(b) Implementation of accounting policy
IAS 23 (Revised) - Borrowing Costs: The company early adopted IAS 23 (Revised)
- Borrowing Costs, retrospectively as at 1 July 2000, which requires that
management capitalise borrowing costs directly attributable to the acquisition
and construction of qualifying assets. Qualifying assets are assets that take a
substantial time to get ready for their intended use.
The impact of this adjustment was as follows:
Quarter ended
June March June
2008 2008 2007
(Unaudited) (Unaudited) (Unaudited)
R million R million R million
Effect on net loss/profit:
Decrease in interest expense 91 11 21
Income tax (26) (3) (6)
Decrease in net loss 65 8 15
Effect on opening accumulated
loss:
Decrease in interest expense 177 166 119
Income tax (52) (49) (34)
Decrease in accumulated loss 125 117 85
Year ended
June June
2008 2007
R million R million
Effect on net loss/profit:
Decrease in interest expense 128 58
Income tax (38) (17)
Decrease in net loss 90 41
Effect on opening accumulated loss:
Decrease in interest expense 140 82
Income tax (40) (23)
Decrease in accumulated loss 100 59
The borrowing costs are added to the cost of those assets, until such time as
the assets are substantially ready for their intended use.
All other borrowing costs are dealt with in profit or loss in the period in
which they are incurred.
2. Cost of sales
The income statement is now presented by function as per the requirements of
IAS1 - Presentation of Financial Statements. The major difference is that cost
of sales in disclosed on the face of the income statement, with the items
disclosed by nature in the notes to the financial statements.
Quarter ended
June March June
2008 2008 2007
(Unaudited) (Unaudited) (Unaudited)
R million R million R million
Cost of sales consists of:
Production costs 1 625 1 517 1 855
Amortisation and depreciation 222 189 214
Impairment of assets 316 - (123)
Provision for rehabilitation
costs 12 - (19)
Care and maintenance cost of
restructured shafts 29 24 11
Employment termination and
restructuring costs 50 86 -
Share-based compensation 19 4 3
Provision for post retirement
benefits 11 - (13)
2 284 1 820 1 928
Year ended
June June
2008 2007
R million R million
Cost of sales consists of:
Production costs 6 673 6 021
Amortisation and depreciation 846 763
Impairment of assets 316 (123)
Provision for rehabilitation costs 12 (16)
Care and maintenance cost of restructured shafts 74 56
Employment termination and restructuring costs 212 -
Share-based compensation 42 41
Provision for post retirement benefits 9 (13)
8 184 6 729
3. Non-current assets held for sale and discontinued operations
The assets and liabilities related to Mt Magnet and South Kal (operations in
Australia), ARMgold Welkom and Orkney (operations in the Free State and
Northwest areas), and Kudu/Sable (operations in the Free State area), have been
presented as held for sale on 30 June 2007.
On 6 December 2007, the sale relating to the South Kal operation (operation in
Australia) was concluded at a loss, net of tax, of R51 million and the assets
were derecognised.
On 27 February 2008, the sale relating to the Orkney operations (operations in
the Northwest area) was concluded at a profit, of R66 million and the assets
were derecognised.
The assets and liabilities relating to the Cooke 1, Cooke 2, Cooke 3, Cooke
plant and relating surface operations (operations in the Gauteng area) have
been presented as held for sale following the approval of the Group`s
management on 16 October 2007. The comparative prior year quarter and year to
date information has been restated for this reclassification.
During June 2008, management decided not to sell the ARMgold Welkom shafts and
Kudu/Sable. Due to this, their results have been included in net profit/(loss)
from continuing operations and the comparative periods restated.
At 30 June 2008, the sale of Mt Magnet was postponed. As management and the
buyer were intent on the sale, even though the one-year period allowed by IFRS
5 has expired, these assets have still been classified as held for sale. See
note 11 for further details.
4. Earnings/(Loss) per share
Earnings/(Loss) per share is calculated on the weighted average number of
shares in issue for the quarter ended 30 June 2008: 402.8 million (31 March
2008: 400.7 million, 30 June 2007: 398.6 million) and the year ended 30 June
2008: 400.8 million (30 June 2007: 397.9 million).
The fully diluted earnings/(loss) per share is calculated on weighted average
number of diluted shares in issue for the quarter ended 30 June 2008: 405.2
million (31 March 2008: 403.5 million, 30 June 2007: 403.1 million) and the
year ended 30 June 2008: 402.9 million (30 June 2007: 402.4 million).
Quarter ended
June March June
2008 2008 2007
(Unaudited) (Unaudited) (Unaudited)
R million R million R million
Total (loss)/earnings per share
(cents):
Basic (loss)/earnings (18) 86 (159)
Headline earnings/(loss) 65 63 (129)
Fully diluted (loss)/earnings (18) 86 (159)
R million R million R million
Reconciliation of headline
earnings/(loss):
Continuing operations
Net (loss)/profit (241) 153 (173)
Adjusted for:
Loss/(Profit) on sale of
property,
plant and equipment 32 (1) (66)
Loss on sale of listed
investment - - 31
Impairment of investments 1 - -
Loss on sale of joint venture 2 - -
Profit on sale of associate - - -
Impairment of investment in
associates 95 - -
Impairment/(Reversal of
impairment) of
property, plant and equipment 159 - (117)
Impairment of intangible assets 105 - -
Provision for doubtful debt - 4 -
Headline profit/(loss) 153 156 (325)
Discontinued operations
Net profit/(loss) 170 192 (463)
Adjusted for:
(Profit)/Loss on sale of
property,
plant and equipment (90) (100) -
Profit on sale of investments - - -
Impairment/(Reversal of
impairment) of
property, plant and equipment 30 4 274
Headline profit/(loss) 110 96 (189)
Total headline profit/(loss) 263 252 (514)
Year ended
June June
2008 2007
R million R million
Total (loss)/earnings per share (cents):
Basic (loss)/earnings (62) 96
Headline earnings/(loss) 127 53
Fully diluted (loss)/earnings (62) 94
R million R million
Reconciliation of headline earnings/(loss):
Continuing operations
Net (loss)/profit (796) 820
Adjusted for:
Loss/(Profit) on sale of property,
plant and equipment (2) (129)
Loss on sale of listed investment 459 30
Impairment of investments 1 -
Loss on sale of joint venture 2 -
Profit on sale of associate - (220)
Impairment of investment in associates 95 -
Impairment/(Reversal of impairment) of
property, plant and equipment 159 (117)
Impairment of intangible assets 105 -
Provision for doubtful debt 52 -
Headline profit/(loss) 75 384
Discontinued operations
Net profit/(loss) 551 (438)
Adjusted for:
(Profit)/Loss on sale of property,
plant and equipment (95) -
Profit on sale of investments - (6)
Impairment/(Reversal of impairment) of
property, plant and equipment (25) 274
Headline profit/(loss) 431 (170)
Total headline profit/(loss) 506 214
5. Restricted investments
June March June
2008 2008 2007
(Unaudited)
R million R million R million
Environmental Trust Funds 1 428 1 271 1 336
Other 37 33 37
1 465 1 304 1 373
6. Investment in financial assets
June March June
2008 2008 2007
(Unaudited)
R million R million R million
Current
Investment in African Rainbow
Minerals Limited (see note 8) - - 1 051
Investment in Gold Fields Limited * - - 1 433
- - 2 484
Non-current
Other 67 109 14
67 109 2 498
* During the September 2007 quarter Harmony sold all of its remaining Gold
Fields Limited (GFI) shares for a loss of R459 million.
7. Investment in associate
On 27 February 2008, Pamodzi Gold Limited bought the Orkney operations from the
Harmony Group for a consideration of 30 million Pamodzi Gold Limited shares.
This resulted in Harmony Gold Mining Company owning 32.4% of Pamodzi Gold
Limited. At 30 June 2008, management tested for impairment of the investment in
associate. An amount of R91 million was impaired and accounted for in the
income statement. The book value at 30 June 2008, after taking impairment and
loss from associate into account, was R145 million.
8. Borrowings
June March June
2008 2008 2007
(Unaudited)
R million R million R million
Unsecured borrowings
Convertible unsecured fixed rate
bonds 1 626 1 605 1 541
Africa Vanguard Resources
(Proprietary) Limited 32 32 32
1 658 1 637 1 573
Less: Short-term portion (1 626) - -
Total unsecured long-term borrowings 32 1 637 1 573
Secured borrowings
Westpac Bank Limited* 258 119 2
Africa Vanguard Resources
(Doornkop) (Pty) Limited (Nedbank
Limited) 194 188 170
ARM Empowerment Trust 1 (Nedbank
Limited)** - - 450
ARM Empowerment Trust 2 (Nedbank
Limited)** - - 601
Rand Merchant Bank - - 1 802
Nedbank Limited 2 000 2 000 -
Less: Unamortised transaction costs (11) (17) -
2 441 2 290 3 025
Less: Short-term portion (2 209) (2 009) (2 855)
Total secured long-term borrowings 232 281 170
Total long-term borrowings 264 1 918 1 743
* The lease was entered into for the purchase of mining fleet to be used on the
Hidden Valley project.
** The guarantees relating to the Nedbank loans were cancelled on 28 September
2007 and consequently Harmony has no further obligations to Nedbank in this
regard. The ARM investment and associated Nedbank loans were derecognised from
this date.
The future minimum lease payments to Westpac Bank Limited are as follows:
June March June
2008 2008 2007
(Unaudited)
R million R million R million
Due within one year 57 26 -
Due between one and five years 228 97 -
285 123 -
9. Cash and cash equivalents
June March June
2008 2008 2007
(Unaudited)
R million R million R million
Comprises:
Continuing operations 413 346 491
Discontinued operations 2 2 3
Total cash and cash equivalents 415 348 494
10. Commitments and contingencies
June March June
2008 2008 2007
(Unaudited)
R million R million R million
Capital expenditure commitments
Contracts for capital expenditure 1 164 1 191 352
Authorised by the directors but not
contracted for 1 720 1 422 1 881
2 884 2 613 2 233
This expenditure will be financed
from existing resources and
where appropriate, borrowings.
Contingent liabilities
Guarantees and suretyships 18 18 18
Environmental guarantees 152 173 129
170 191 147
Contingent liability
On 18 April 2008, Harmony Gold Mining Company Limited was made aware that it
has been named or may be named as a defendant in a lawsuit filed in the U.S.
District Court in the Southern District of New York on behalf of certain
purchasers and sellers of Harmony`s American Depositary Receipts ("ADRs").
Harmony has retained legal counsel, who will advise Harmony on further
developments in the U.S.
11. Subsequent events
Village Main Reef
On 11 July 2008, Harmony sold its 37.8% share in Village Main Reef Gold Mining
Company (1934) Limited for R1.1 million to To The Point Investments. Z B
Swanepoel, Harmony`s previous Chief Executive Officer, is a director and
founder of To The Point Investments.
PNG Partnership agreement
On 22 April 2008 Morobe Consolidated Goldfields Limited and Wafi Mining
Limited, subsidiaries of Harmony Gold (Australia) Pty Ltd entered into a Master
Purchase and Farm-in Agreement with Newcrest Mining Limited (Newcrest). This
agreement provides for Newcrest to purchase a 30.01% Participating Interest
(Stage 1) and a further buy-out of an additional 19.99% Participating Interest
in Harmony`s Papua New Guinea (PNG) gold and copper assets. Due to the fact
that there were a number of conditions precedents to be met, the expected
profit on the transaction was not recognised in the 2007/2008 financial year.
On 16 July 2008 the conditions precedent were finalised, which included
regulatory and statutory approvals by the PNG Government. Stage 1 Completion
has now taken place with an effective date of 31 July 2008.
Total consideration for Stage 1 completion of US$229 million was received, of
which US$50 million has been placed in a jointly controlled Escrow account
which will revert to Harmony upon the confirmation of an exploration licence
("EL") approval by the PNG Mining Authorities. Re-registration of the EL is
expected by the end of August 2008.
The expected profit on Stage 1 Completion is estimated to be AUD$84.3 million
(post-tax) and will be accounted for in the September 2008 quarter.
Sale of MMG and BBO entities
Harmony announced on the 8 November 2007 that it signed a letter of intent with
Monarch Gold Mining Company for the sale of its Mount Magnet operations for
AUD$65 million. On 8 July 2008 Harmony further announced a revision to the deal
and an extension of the period in which the conditions precedent is to be met.
Subsequent to this announcement Harmony was advised that the terms of the sale
contract with Monarch Gold had been reconstituted, Monarch placed itself in
voluntary administration.
On 1 August 2008 the Administrator indicated that Monarch will not proceed with
the proposed purchase and consequently the purchase agreement has been
terminated. Harmony received from Monarch a deposit of AUD$5 million of which
AUD$2.5 million has been refunded and AUD$2.5 million has been recorded as
revenue. Harmony has resumed management of the operation and has re-commenced
the sale process.
12. Segment report
The primary reporting format of the Company is by business segment. As there is
only one business segment, being mining, extraction and production of gold, the
relevant disclosures have been given in the condensed consolidated financial
statements.
13. Audit review
The condensed consolidated financial statements for the year ended 30 June 2008
on pages 28 to 37 have been reviewed in accordance with International Standards
on Review Engagements 2410 - "Review of interim financial information performed
by the Independent Auditors of the entity" by PricewaterhouseCoopers Inc. Their
unqualified review opinion is available for inspection at the Company`s
registered office.
DETAILED OPERATING INFORMATION YEAR ENDED 30 JUNE 2008 (Rand/Metric)
Cash Cash
Continuing operating operating Capital
Operations Revenue cost profit/(loss) expenditure
South Africa R million R million R million R million
Tshepong 1 621 906 715 195
Phakisa 28 17 11 293
Doornkop 258 225 33 349
Elandsrand 964 751 213 318
Target 503 374 129 256
Masimong 698 637 61 114
Evander Operations
Evander 5 360 259 101 43
Evander 7 316 231 85 83
Evander 8 726 426 300 116
Total Evander
Operations 1 402 916 486 242
Bambanani 932 741 191 107
Joel 375 284 91 39
Virginia
Operations
Harmony 2 283 262 21 39
Merriespruit 1 287 239 48 31
Merriespruit 3 240 229 11 22
Unisel 399 318 81 38
Brand 3 279 251 28 22
Brand 5 - 9 (9) -
Total Virginia
Operations 1 488 1 308 180 152
St Helena 41 92 (51) 4
Kalgold 557 278 279 10
Project Phoenix 191 89 102 4
Other entities 152 55 97 136
Total South Africa 9 210 6 673 2 537 2 219
International
PNG - - - 1 428
Total
International - - - 1 428
Total Harmony
- Continuing
Operations 9 210 6 673 2 537 3 647
Continuing Kilograms Tonnes Operating
Operations gold milled Grade Cost
South Africa t`000 R/kg
Tshepong 8 495 1 495 5.68 106 658
Phakisa 131 31 4.23 130 221
Doornkop 1 373 448 3.06 164 099
Elandsrand 4 934 890 5.54 152 171
Target 2 644 622 4.25 141 027
Masimong 3 657 809 4.52 174 080
Evander Operations
Evander 5 1 884 346 5.45 137 386
Evander 7 1 772 280 6.33 130 210
Evander 8 3 810 686 5.56 111 715
Total Evander
Operations 7 466 1 312 5.69 122 598
Bambanani 4 945 827 5.98 149 792
Joel 1 904 407 4.68 149 305
Virginia Operations
Harmony 2 1 497 442 3.38 174 852
Merriespruit 1 1 463 387 3.78 163 585
Merriespruit 3 1 258 389 3.23 181 769
Unisel 2 103 496 4.24 151 376
Brand 3 1 465 416 3.52 171 437
Brand 5 - - - -
Total Virginia
Operations 7 786 2 130 4.00 174 091
St Helena 260 78 3.33 355 654
Kalgold 2 898 1 530 1.89 95 939
Project Phoenix 1 002 6 378 0.19 75 184
Other entities 732 729 0.73 98 100
Total South Africa 48 227 17 686 2.73 138 319
International
PNG - - - -
Total International - - - -
Total Harmony
- Continuing
Operations 48 227 17 686 2.73 138 319
Cash Cash
Discontinued operating operating Capital
Operations Revenue cost profit/(loss) expenditure
South Africa R million R million R million R million
Orkney 2 148 148 - 6
Orkney 4 110 145 (35) 9
Orkney 7 54 82 (28) 11
Cooke 1 357 231 126 16
Cooke 2 353 201 152 35
Cooke 3 491 325 166 107
Cooke Plant
Operations 205 130 75 4
Total South Africa 1 718 1 262 456 188
Australia
Mt Magent 408 301 107 29
South Kal 137 105 32 91
Total Australia 545 406 139 120
Total Harmony
- Discontinued
Operations 2 263 1 668 595 308
Total Harmony 11 473 8 341 3 132 3 955
Discontinued Kilograms Tonnes Operating
Operations gold milled Grade Cost
South Africa t`000 R/kg
Orkney 2 831 160 5.23 179 596
Orkney 4 637 195 3.27 228 190
Orkney 7 309 163 1.89 266 312
Cooke 1 1 842 297 6.20 125 587
Cooke 2 1 861 341 5.46 107 739
Cooke 3 2 578 561 4.60 126 010
Cooke Plant Operations 1 067 2 342 0.46 121 549
Total South Africa 9 125 4 059 2.55 138 464
Australia
Mt Magent 2 398 876 2.73 125 488
South Kal 864 433 2.00 120 812
Total Australia 3 262 1 309 2.49 124 285
Total Harmony
- Discontinued
Operations 12 387 5 368 2.31 134 718
Total Harmony 60 614 23 054 2.63 137 584
DETAILED OPERATING INFORMATION YEAR ENDED 30 JUNE 2007 (Rand/Metric)
Cash Cash
Continuing operating operating Capital
Operations Revenue cost profit/(loss) expenditure
South Africa R million R million R million R million
Tshepong 1 460 807 653 188
Phakisa - - - 227
Doornkop 263 181 82 270
Elandsrand 895 738 157 238
Target 657 380 277 121
Masimong 681 596 85 109
Evander
Operations
Evander 5 257 208 49 39
Evander 7 283 278 5 86
Evander 8 548 330 218 79
Total Evander
Operations 1 088 816 272 204
Bambanani 902 831 71 125
Joel 366 241 125 28
Virginia
Operations
Harmony 2 215 215 - 35
Merriespruit 1 234 191 43 25
Merriespruit 3 201 180 21 25
Unisel 368 252 116 39
Brand 3 210 200 10 11
Brand 5 4 11 (7) -
Total Virginia
Operations 1 232 1 049 183 135
St Helena 98 129 (31) 10
Kudu/Sable 4 - 4 -
Kalgold 257 196 61 3
Project Phoenix 94 45 49 -
Other entities 40 12 28 117
Total South Africa 8 037 6 021 2 016 1 775
International
PNG - - - 526
Total
International - - - 526
Total Harmony
- Continuing
Operations 8 037 6 021 2 016 2 301
Continuing Kilograms Tonnes Operating
Operations gold milled Cost
South Africa T`000 Grade R/kg
Tshepong 9 919 1 654 5.99 81 324
Phakisa - - - -
Doornkop 1 784 541 3.30 101 708
Elandsrand 6 056 1 013 5.98 121 884
Target 4 430 820 5.41 85 678
Masimong 4 602 974 4.73 129 376
Evander Operations
Evander 5 1 731 342 5.07 120 229
Evander 7 1 899 405 4.69 146 469
Evander 8 3 692 764 4.83 89 287
Total Evander
Operations 7 322 1 511 4.85 111 433
Bambanani 6 129 1 164 5.27 135 609
Joel 2 486 457 5.44 96 750
Virginia Operations
Harmony 2 1 439 468 3.07 149 527
Merriespruit 1 1 574 432 3.64 121 206
Merriespruit 3 1 354 402 3.36 133 115
Unisel 2 488 557 4.47 101 299
Brand 3 1 419 403 3.52 140 913
Brand 5 29 11 2.64 384 477
Total Virginia
Operations 8 303 2 273 3.65 126 364
St Helena 663 218 3.04 194 413
Kudu/Sable 26 14 - -
Kalgold 1 746 1 578 1.11 112 227
Project Phoenix 664 2 148 0.31 67 854
Other entities 210 416 0.51 58 323
Total South Africa 54 340 14 781 3.68 110 785
International
PNG - - - -
Total International - - - -
Total Harmony
- Continuing
Operations 54 340 14 781 3.68 110 785
Cash Cash
Discontinued operating operating Capital
Operations Revenue cost profit/(loss) expenditure
South Africa R million R million R million R million
Orkney 2 240 190 50 31
Orkney 3 - - - -
Orkney 4 209 189 20 37
Orkney 7 95 86 9 42
ARM surface 1 - 1 -
Cooke 1 348 236 112 14
Cooke 2 261 251 10 27
Cooke 3 417 317 100 98
Cooke Plant
Operations 88 42 46 -
Total South Africa 1 659 1 311 348 249
Australia
Mt Magent 617 508 109 145
South Kal 404 321 83 48
Total Australia 1 021 829 192 193
Total Harmony
- Discontinued
Operations 2 680 2 140 540 442
Total Harmony 10 717 8 161 2 556 2 743
Discontinued Kilograms Tonnes Operating
Operations gold milled Cost
South Africa T`000 Grade R/kg
Orkney 2 1 626 282 5.77 116 621
Orkney 3 - - - -
Orkney 4 1 432 360 3.98 132 286
Orkney 7 643 217 2.96 133 723
ARM surface 4 1 - -
Cooke 1 2 354 386 6.10 100 439
Cooke 2 1 780 349 5.10 141 089
Cooke 3 2 841 564 5.04 111 681
Cooke Plant Operations 590 811 0.73 70 631
Total South Africa 11 270 2 970 3.80 116 377
Australia
Mt Magent 4 243 1 700 2.50 119 877
South Kal 2 749 1 261 2.18 116 715
Total Australia 6 992 2 961 2.36 118 634
Total Harmony
- Discontinued
Operations 18 262 5 931 3.08 117 241
Total Harmony 72 602 20 712 3.51 112 409
(US$/Imperial)
OPERATING RESULTS - CONTINUING OPERATIONS
Underground production - South Africa
Doorn-
Tshepong Phakisa kop
Ore Milled - t`000 Jun-08 436 18 139
Mar-08 359 10 82
Gold Produced - oz Jun-08 62 919 1 929 11 028
Mar-08 64 012 1 704 5 916
Yield - oz/t Jun-08 0.14 0.11 0.08
Mar-08 0.18 0.17 0.07
Cash Operating
Costs - $/oz Jun-08 429 513 593
Mar-08 452 455 1 245
Cash Operating
Costs - $/t Jun-08 62 55 47
Mar-08 81 78 90
Working Revenue ($`000) Jun-08 56 411 1 731 9 888
Mar-08 59 880 1 593 5 724
Cash Operating
Costs ($`000) Jun-08 26 972 989 6 542
Mar-08 28 931 776 7 364
Cash Operating
Profit ($`000) Jun-08 29 439 742 3 346
Mar-08 30 949 817 (1 640)
Capital Expenditure ($`000) Jun-08 6 439 12 491 12 906
Mar-08 5 807 9 855 11 243
Underground production - South Africa
Elands-
rand Target Masimong
Ore Milled - t`000 Jun-08 323 174 225
Mar-08 236 170 178
Gold Produced - oz Jun-08 49 512 21 412 28 485
Mar-08 34 240 18 165 24 756
Yield - oz/t Jun-08 0.15 0.12 0.13
Mar-08 0.15 0.11 0.14
Cash Operating Costs - $/oz Jun-08 540 700 694
Mar-08 664 647 703
Cash Operating Costs - $/t Jun-08 83 86 88
Mar-08 96 69 98
Working Revenue ($`000) Jun-08 44 651 19 132 25 593
Mar-08 33 087 16 904 23 379
Cash Operating Costs ($`000) Jun-08 26 758 14 997 19 761
Mar-08 22 723 11 755 17 397
Cash Operating Profit ($`000) Jun-08 17 893 4 135 5 832
Mar-08 10 364 5 149 5 982
Capital Expenditure ($`000) Jun-08 12 249 11 768 3 354
Mar-08 11 203 10 962 3 402
Underground production - South Africa
Evander Bamba-
Operations nani Joel
Ore Milled - t`000 Jun-08 331 147 150
Mar-08 307 173 100
Gold Produced - oz Jun-08 49 705 32 440 19 676
Mar-08 48 226 34 273 13 439
Yield - oz/t Jun-08 0.15 0.22 0.13
Mar-08 0.16 0.20 0.13
Cash Operating Costs - $/oz Jun-08 515 572 499
Mar-08 599 664 690
Cash Operating Costs - $/t Jun-08 77 126 65
Mar-08 94 132 93
Working Revenue ($`000) Jun-08 44 548 29 080 17 652
Mar-08 46 018 31 532 12 797
Cash Operating Costs ($`000) Jun-08 25 599 18 571 9 809
Mar-08 28 897 22 759 9 274
Cash Operating Profit ($`000) Jun-08 18 949 10 509 7 843
Mar-08 17 121 8 773 3 523
Capital Expenditure ($`000) Jun-08 7 185 2 836 1 153
Mar-08 7 174 2 895 1 130
Underground production - South Africa
Total SA
Virginia Under-
Operations St Helena ground
Ore Milled - t`000 Jun-08 576 - 2 519
Mar-08 518 - 2 133
Gold Produced - oz Jun-08 57 132 - 334 238
Mar-08 54 334 - 299 065
Yield - oz/t Jun-08 0.10 - 0.13
Mar-08 0.10 - 0.14
Cash Operating Costs - $/oz Jun-08 790 - 584
Mar-08 717 - 631
Cash Operating Costs - $/t Jun-08 78 - 77
Mar-08 75 - 89
Working Revenue ($`000) Jun-08 51 304 - 299 990
Mar-08 51 595 4 282 509
Cash Operating Costs ($`000) Jun-08 45 152 - 195 150
Mar-08 38 951 1 541 188 827
Cash Operating Profit ($`000) Jun-08 6 152 - 104 840
Mar-08 12 644 (1 537) 93 682
Capital Expenditure ($`000) Jun-08 5 288 1 75 669
Mar-08 3 849 22 67 520
Surface production - South Africa
Kalgold Project Other
Surface Phoenix Surface
Ore Milled - t`000 Jun-08 423 1 750 309
Mar-08 429 1 754 233
Gold Produced - oz Jun-08 20 866 7 202 13 664
Mar-08 23 406 6 848 3 343
Yield - oz/t Jun-08 0.05 - 0.04
Mar-08 0.05 - 0.01
Cash Operating Costs - $/oz Jun-08 393 424 203
Mar-08 409 394 475
Cash Operating Costs - $/t Jun-08 19 2 9
Mar-08 22 2 7
Working Revenue ($`000) Jun-08 18 741 6 486 12 071
Mar-08 21 920 6 541 3 181
Cash Operating Costs ($`000) Jun-08 8 195 3 057 2 775
Mar-08 9 568 2 701 1 588
Cash Operating Profit ($`000) Jun-08 10 546 3 429 9 296
Mar-08 12 352 3 840 1 593
Capital Expenditure ($`000) Jun-08 621 25 7 093
Mar-08 121 48 2 448
Surface production -
South Africa
South
Total SA Africa
Surface Total
Ore Milled - t`000 Jun-08 2 482 5 001
Mar-08 2 416 4 549
Gold Produced - oz Jun-08 41 732 375 970
Mar-08 33 597 332 662
Yield - oz/t Jun-08 0.02 0.08
Mar-08 0.01 0.07
Cash Operating Costs - $/oz Jun-08 336 556
Mar-08 412 609
Cash Operating Costs - $/t Jun-08 6 42
Mar-08 6 45
Working Revenue ($`000) Jun-08 37 298 337 288
Mar-08 31 642 314 151
Cash Operating Costs ($`000) Jun-08 14 027 209 177
Mar-08 13 857 202 684
Cash Operating Profit ($`000) Jun-08 23 271 128 111
Mar-08 17 785 111 467
Capital Expenditure ($`000) Jun-08 7 739 83 408
Mar-08 2 617 70 137
International
production Harmony
PNG Total
Ore Milled - t`000 Jun-08 - 5 001
Mar-08 - 4 549
Gold Produced - oz Jun-08 - 375 970
Mar-08 - 332 662
Yield - oz/t Jun-08 - 0.08
Mar-08 - 0.07
Cash Operating Costs - $/oz Jun-08 - 556
Mar-08 - 609
Cash Operating Costs - $/t Jun-08 - 42
Mar-08 - 45
Working Revenue ($`000) Jun-08 - 337 288
Mar-08 - 314 151
Cash Operating Costs ($`000) Jun-08 - 209 177
Mar-08 - 202 684
Cash Operating Profit ($`000) Jun-08 - 128 111
Mar-08 - 111 467
Capital Expenditure ($`000) Jun-08 86 004 169 412
Mar-08 43 646 113 783
Evander operations - Evander 5, Evander 7 and Evander 8
Virginia operations - Harmony 2, Merriespruit 1 and 3, Unisel and Brand
(US$/Imperial)
OPERATING RESULTS INCLUDING DISCONTINUED OPERATIONS
Underground production - South Africa
Doorn-
Tshepong Phakisa kop
Ore milled - t`000 Jun-08 436 18 139
Mar-08 359 10 82
Gold Produced - oz Jun-08 62 919 1 929 11 028
Mar-08 64 012 1 704 5 916
Yield - oz/t Jun-08 0.14 0.11 0.08
Mar-08 0.18 0.17 0.07
Cash Operating Costs - $/oz Jun-08 429 513 593
Mar-08 452 455 1 245
Cash Operating Costs - $/t Jun-08 62 55 47
Mar-08 81 78 90
Working Revenue ($`000) Jun-08 56 411 1 731 9 888
Mar-08 59 880 1 593 5 724
Cash Operating Costs ($`000) Jun-08 26 973 989 6 542
Mar-08 28 931 776 7 364
Cash Operating Profit ($`000) Jun-08 29 438 742 3 346
Mar-08 30 949 817 (1 640)
Capital Expenditure ($`000) Jun-08 6 439 12 491 12 906
Mar-08 5 807 9 855 11 243
Underground production - South Africa
Elands-
rand Target Masimong
Ore milled - t`000 Jun-08 323 174 225
Mar-08 236 170 178
Gold Produced - oz Jun-08 49 512 21 412 28 485
Mar-08 34 240 18 165 24 756
Yield - oz/t Jun-08 0.15 0.12 0.13
Mar-08 0.15 0.11 0.14
Cash Operating Costs - $/oz Jun-08 540 700 694
Mar-08 664 647 703
Cash Operating Costs - $/t Jun-08 83 86 88
Mar-08 96 69 98
Working Revenue ($`000) Jun-08 44 651 19 132 25 593
Mar-08 33 087 16 904 23 379
Cash Operating Costs ($`000) Jun-08 26 758 14 997 19 761
Mar-08 22 723 11 755 17 397
Cash Operating Profit ($`000) Jun-08 17 893 4 135 5 832
Mar-08 10 364 5 149 5 982
Capital Expenditure ($`000) Jun-08 12 249 11 768 3 354
Mar-08 11 203 10 962 3 402
Underground production - South Africa
Rand-
Evander fontein Bamba-
Operations Operations nani
Ore milled - t`000 Jun-08 331 323 147
Mar-08 307 305 173
Gold Produced - oz Jun-08 49 705 43 371 32 440
Mar-08 48 226 43 532 34 273
Yield - oz/t Jun-08 0.15 0.13 0.22
Mar-08 0.16 0.14 0.20
Cash Operating Costs - $/oz
Jun-08 515 481 572
Mar-08 599 570 664
Cash Operating Costs - $/t Jun-08 77 65 126
Mar-08 94 81 132
Working Revenue ($`000) Jun-08 44 548 38 978 29 080
Mar-08 46 018 42 010 31 532
Cash Operating Costs ($`000)
Jun-08 25 599 20 871 18 571
Mar-08 28 897 24 818 22 759
Cash Operating Profit ($`000) Jun-08 18 949 18 107 10 509
Mar-08 17 121 17 192 8 773
Capital Expenditure ($`000) Jun-08 7 185 5 277 2 836
Mar-08 7 174 5 401 2 895
Underground production - South Africa
Virginia
Opera-
Joel tions St Helena
Ore milled - t`000 Jun-08 150 576 -
Mar-08 100 518 -
Gold Produced - oz Jun-08 19 676 57 132 -
Mar-08 13 439 54 334 -
Yield - oz/t Jun-08 0.13 0.10 -
Mar-08 0.13 0.10 -
Cash Operating Costs - $/oz Jun-08 499 790 -
Mar-08 690 717 -
Cash Operating Costs - $/t Jun-08 65 78 -
Mar-08 93 75 -
Working Revenue ($`000) Jun-08 17 652 51 304 -
Mar-08 12 797 51 595 4
Cash Operating Costs ($`000) Jun-08 9 809 45 152 -
Mar-08 9 274 38 951 1 541
Cash Operating Profit ($`000) Jun-08 7 843 6 152 -
Mar-08 3 523 12 644 (1 537)
Capital Expenditure ($`000) Jun-08 1 153 5 288 1
Mar-08 1 130 3 849 22
Underground production - South Africa
Total SA
Under-
ARMgold ground
Ore milled - t`000 Jun-08 - 2 842
Mar-08 119 2 557
Gold Produced - oz Jun-08 - 377 609
Mar-08 9 645 352 242
Yield - oz/t Jun-08 - 0.13
Mar-08 0.08 0.14
Cash Operating Costs - $/oz Jun-08 - 572
Mar-08 1 345 648
Cash Operating Costs - $/t Jun-08 - 76
Mar-08 109 89
Working Revenue ($`000) Jun-08 - 338 968
Mar-08 9 246 333 769
Cash Operating Costs ($`000) Jun-08 47 216 069
Mar-08 12 969 228 155
Cash Operating Profit ($`000) Jun-08 (47) 122 899
Mar-08 (3 723) 105 614
Capital Expenditure ($`000) Jun-08 (9) 80 938
Mar-08 (1) 72 942
Surface production - South Africa
Cooke
Kalgold Project plant
Surface Phoenix Operations
Ore milled - t`000 Jun-08 423 1 750 579
Mar-08 429 1 754 711
Gold Produced - oz Jun-08 20 866 7 202 6 816
Mar-08 23 406 6 848 8 841
Yield - oz/t Jun-08 0.05 - 0.01
Mar-08 0.05 - 0.01
Cash Operating Costs - $/oz Jun-08 393 424 636
Mar-08 409 394 598
Cash Operating Costs - $/t Jun-08 19 2 7
Mar-08 22 2 7
Working Revenue ($`000) Jun-08 18 741 6 486 6 109
Mar-08 21 920 6 541 8 413
Cash Operating Costs ($`000) Jun-08 8 195 3 057 4 333
Mar-08 9 568 2 701 5 287
Cash Operating Profit ($`000) Jun-08 10 546 3 429 1 776
Mar-08 12 352 3 840 3 126
Capital Expenditure ($`000) Jun-08 621 25 140
Mar-08 121 48 254
Surface production - South Africa
Other Total SA
Surface Surface
Ore milled - t`000 Jun-08 309 3 061
Mar-08 233 3 127
Gold Produced - oz Jun-08 13 664 48 548
Mar-08 3 343 42 438
Yield - oz/t Jun-08 0.04 0.02
Mar-08 0.01 0.01
Cash Operating Costs - $/oz Jun-08 203 378
Mar-08 475 451
Cash Operating Costs - $/t Jun-08 9 6
Mar-08 7 6
Working Revenue ($`000) Jun-08 12 071 43 407
Mar-08 3 181 40 055
Cash Operating Costs ($`000) Jun-08 2 775 18 360
Mar-08 1 588 19 144
Cash Operating Profit ($`000) Jun-08 9 296 25 047
Mar-08 1 593 20 911
Capital Expenditure ($`000) Jun-08 7 093 7 879
Mar-08 2 448 2 871
International
production
South
Africa
Total Australia
Ore milled - t`000 Jun-08 5 903 -
Mar-08 5 684 38
Gold Produced - oz Jun-08 426 157 -
Mar-08 394 680 1 800
Yield - oz/t Jun-08 0.07 -
Mar-08 0.07 0.05
Cash Operating Costs - $/oz Jun-08 550 -
Mar-08 627 2 139
Cash Operating Costs - $/t Jun-08 40 -
Mar-08 44 101
Working Revenue ($`000) Jun-08 382 375 -
Mar-08 373 824 4 014
Cash Operating Costs ($`000) Jun-08 234 429 -
Mar-08 247 299 3 851
Cash Operating Profit ($`000) Jun-08 147 946 -
Mar-08 126 525 163
Capital Expenditure ($`000) Jun-08 88 817 36
Mar-08 75 813 8
International
production
Total
Inter-
PNG national
Ore milled - t`000 Jun-08 - -
Mar-08 - 38
Gold Produced - oz Jun-08 - -
Mar-08 - 1 800
Yield - oz/t Jun-08 - -
Mar-08 - 0.05
Cash Operating Costs - $/oz Jun-08 - -
Mar-08 - 2 139
Cash Operating Costs - $/t Jun-08 - -
Mar-08 - 101
Working Revenue ($`000) Jun-08 - -
Mar-08 - 4 014
Cash Operating Costs ($`000) Jun-08 - -
Mar-08 - 3 851
Cash Operating Profit ($`000) Jun-08 - -
Mar-08 - 163
Capital Expenditure ($`000) Jun-08 86 004 86 040
Mar-08 43 646 43 654
Harmony
Total
Ore milled - t`000 Jun-08 5 903
Mar-08 5 722
Gold Produced - oz Jun-08 426 157
Mar-08 396 480
Yield - oz/t Jun-08 0.07
Mar-08 0.07
Cash Operating Costs - $/oz Jun-08 550
Mar-08 633
Cash Operating Costs - $/t Jun-08 40
Mar-08 44
Working Revenue ($`000) Jun-08 382 375
Mar-08 377 838
Cash Operating Costs ($`000) Jun-08 234 429
Mar-08 251 150
Cash Operating Profit ($`000) Jun-08 147 946
Mar-08 126 688
Capital Expenditure ($`000) Jun-08 174 857
Mar-08 119 467
Evander operations - Evander 5, Evander 7 and Evander 8
Randfontein operations - Cooke 1, Cooke 2 and Cooke 3
Virginia operations - Harmony 2, Merriespruit 1 and 3, Unisel and Brand
CONDENSED CONSOLIDATED INCOME STATEMENT (Unaudited) (US$)
Quarter ended
June March June 1
2008 2008 2007
US$ million US$ million US$ million
Continuing operations
Revenue 337 329 265
Cost of sales (294) (256) (272)
Production cost (209) (214) (262)
Amortisation and depreciation (29) (27) (30)
Impairment of assets (41) - 17
Employment termination and
restructuring costs (6) (12) -
Other items (9) (3) 3
Gross profit/(loss) 43 73 (7)
Corporate, administration and
other expenditure (6) (8) (12)
Exploration expenditure (8) (8) (12)
Other (expenses)/income - net (1) (2) 11
Operating profit/(loss) 28 55 (20)
Loss from associates (9) (1) -
Profit on sale of investment in
associate - - -
Impairment of investment in
associate (12) - -
Mark-to-market of listed
investments - - 4
Loss on sale of listed
investments - - (5)
Impairment of investments - - -
Investment income 11 8 12
Finance cost (17) (17) (28)
Profit/(Loss) before taxation 1 45 (37)
Taxation (32) (22) 12
Net (loss)/profit from
continuing operations (31) 23 (25)
Discontinued operations
Profit/(Loss) from discontinued
operations 22 27 (65)
Net (loss)/profit (9) 50 (90)
(Loss)/Earnings per share from
continuing operations
attributable to the equity
holders of the Company
during the year (cents)
- Basic (loss)/earnings (8) 5 (6)
- Headline earnings/(loss) 5 5 (11)
- Fully diluted (loss)/earnings (8) 5 (6)
Earnings/(Loss) per share from
discontinuing operations
attributable to the equity
holders of the Company
during the year (cents)
- Basic earnings/(loss) 5 7 (16)
- Headline earnings/(loss) 3 3 (7)
- Fully diluted earnings/(loss) 5 7 (16)
Total (loss)/earnings per share
from all operations
attributable to the equity
holders of the Company
during the year (cents)
- Basic (loss)/earnings (3) 12 (22)
- Headline earnings/(loss) 8 8 (18)
- Fully diluted (loss)/earnings (3) 12 (22)
Year ended
June June 1
2008 2007
US$ million US$ million
Continuing operations
Revenue 1 269 1 116
Cost of sales (1 127) (935)
Production cost (919) (836)
Amortisation and depreciation (117) (106)
Impairment of assets (44) 17
Employment termination and restructuring costs (29) -
Other items (18) (10)
Gross profit/(loss) 142 181
Corporate, administration and other expenditure (31) (31)
Exploration expenditure (28) (27)
Other (expenses)/income - net (12) 26
Operating profit/(loss) 71 149
Loss from associates (11) (3)
Profit on sale of investment in associate - 33
Impairment of investment in associate (13) -
Mark-to-market of listed investments 5 15
Loss on sale of listed investments (63) (5)
Impairment of investments - (1)
Investment income 39 26
Finance cost (71) (63)
Profit/(Loss) before taxation (43) 151
Taxation (64) (38)
Net (loss)/profit from continuing operations (107) 113
Discontinued operations
Profit/(Loss) from discontinued operations 76 (61)
Net (loss)/profit (31) 52
(Loss)/Earnings per share from continuing
operations
attributable to the equity holders of the
Company
during the year (cents)
- Basic (loss)/earnings (27) 29
- Headline earnings/(loss) 3 13
- Fully diluted (loss)/earnings (27) 28
Earnings/(Loss) per share from discontinuing
operations
attributable to the equity holders of the
Company
during the year (cents)
- Basic earnings/(loss) 19 (15)
- Headline earnings/(loss) 15 (6)
- Fully diluted earnings/(loss) 19 (15)
Total (loss)/earnings per share from all
operations
attributable to the equity holders of the
Company
during the year (cents)
- Basic (loss)/earnings (8) 14
- Headline earnings/(loss) 18 7
- Fully diluted (loss)/earnings (8) 13
The currency conversion rates average for the quarters ended: June 2008: US$1 =
R7.77 (March 2008: US$1 = R7.43, June 2007:
US$1=R7.09)
The currency conversion rates average for the year ended: June 2008: US$1 =
R7.26 (June 2007: US$1=R7.20)
1 The comparative figures were adjusted to exclude further discontinued
operations and interest capitalised.
CONDENSED CONSOLIDATED BALANCE SHEET (Unaudited) (US$)
At At At
June March June
2008 2008 2007
US$ million US$ million US$ million
ASSETS
Non-current assets
Property, plant and equipment 3 533 3 265 3 486
Intangible assets 283 284 328
Restricted cash 10 10 1
Restricted investments 188 160 195
Investments in financial assets 9 13 2
Investments in associates 19 42 1
Trade and other receivables 18 1 13
4 060 3 775 4 026
Current assets
Inventories 89 80 105
Investments in financial assets - - 353
Trade and other receivables 111 122 130
Income and mining taxes 11 7 9
Restricted cash - - 39
Cash and cash equivalents 53 43 101
264 252 737
Non-current assets classified
as held for sale 197 211 182
461 463 919
Total assets 4 521 4 238 4 945
EQUITY AND LIABILITIES
Share capital and reserves
Share capital 3 320 3 178 3 641
Other reserves 87 90 (50)
Accumulated loss (235) (219) (225)
3 172 3 049 3 366
Non-current liabilities
Borrowings 34 236 248
Deferred income tax 383 319 386
Provisions for other
liabilities and charges 163 132 173
580 687 807
Current liabilities
Trade and other payables 176 114 219
Provisions and accrued
liabilities 37 32 38
Borrowings 492 247 406
Bank overdraft - - 31
705 393 694
Liabilities directly associated
with non-current
assets classified as held for
sale 64 109 78
769 502 772
Total equity and liabilities 4 521 4 238 4 945
Number of ordinary shares in
issue 403 253 756 402 818 020 399 608 384
Net asset value per share
(cents) 787 757 842
Balance sheet converted at conversion rate of US$1 = R7.80 (March 2008: R8.14)
(June 2007: R7.04)
CONDENSED CONSOLIDATED STATEMENT OF CHANGE IN EQUITY (Unaudited) (US$)
Issued share Other
capital reserves
US$ million US$ million
Balance - 30 June 2007 (as previously reported) 3 287 (45)
Change in accounting policy for the
capitalisation of
interest on assets under construction - -
Balance - 30 June 2007 (restated) 3 287 (45)
Issue of share capital 33 -
Currency translation adjustment and other - 131
Net loss - -
Dividends paid - -
Balance as at 30 June 2008 3 320 86
Balance - 30 June 2006 (as previously reported) 3 621 (38)
Change in accounting policy for the
capitalisation of
interest on assets under construction - -
Balance - 30 June 2006 (restated) 3 621 (38)
Issue of share capital 21 -
Currency translation adjustment and other - (11)
Net profit - -
Dividends paid - -
Balance as at 30 June 2007 3 642 (49)
Accumulated
loss Total
US$ million US$ million
Balance - 30 June 2007 (as previously reported) (216) 3 026
Change in accounting policy for the
capitalisation of
interest on assets under construction 13 13
Balance - 30 June 2007 (restated) (203) 3 039
Issue of share capital - 33
Currency translation adjustment and other - 131
Net loss (31) (31)
Dividends paid (1) (1)
Balance as at 30 June 2008 (235) 3 171
Balance - 30 June 2006 (as previously reported) (286) 3 297
Change in accounting policy for the
capitalisation of
interest on assets under construction 8 8
Balance - 30 June 2006 (restated) (278) 3 305
Issue of share capital - 21
Currency translation adjustment and other - (11)
Net profit 54 54
Dividends paid (1) (1)
Balance as at 30 June 2007 (225) 3 368
CONDENSED CONSOLIDATED CASH FLOW STATEMENT (Unaudited) (US$)
Quarter ended
June March
2008 2008
US$ million US$ million
Cash flow from operating activities
Cash generated by operations 194 107
Interest and dividends received 12 9
Interest paid (15) (17)
Income and mining taxes paid (9) (6)
Cash generated by operating activities 182 93
Cash flow from investing activities
(Increase)/decrease in restricted cash - -
Net proceeds on disposal of listed investments - -
Net additions to property, plant and equipment (163) (119)
Other investing activities (24) 1
Cash utilised by investing activities (187) (118)
Cash flow from financing activities
Long-term loans raised 20 -
Long-term loans repaid (2) -
Ordinary shares issued - net of expenses 3 5
Dividends paid (1) -
Cash generated by financing activities 20 5
Foreign currency translation adjustments (5) -
Net increase/(decrease) in cash and equivalents 10 (20)
Cash and equivalents - beginning of period 43 63
Cash and equivalents - end of period 53 43
Year ended
June June
2008 2007
US$ million US$ million
Cash flow from operating activities
Cash generated by operations 272 177
Interest and dividends received 42 28
Interest paid (57) (31)
Income and mining taxes paid (18) (2)
Cash generated by operating activities 239 172
Cash flow from investing activities
(Increase)/decrease in restricted cash 28 (4)
Net proceeds on disposal of listed investments 184 55
Net additions to property, plant and equipment (516) (362)
Other investing activities (23) (7)
Cash utilised by investing activities (327) (318)
Cash flow from financing activities
Long-term loans raised 323 253
Long-term loans repaid (256) (139)
Ordinary shares issued - net of expenses 12 19
Dividends paid (1) (1)
Cash generated by financing activities 78 132
Foreign currency translation adjustments (7) (7)
Net increase/(decrease) in cash and equivalents (17) (21)
Cash and equivalents - beginning of period 70 91
Cash and equivalents - end of period 53 70
Operating activities translated at average rates of: Three months ended June
2008: US$1 = R7.77 (March 2008: US$1 = R7.43) year ended June 2008: US$1 =
R7.26 (June 2007: US$ = R7.20)
Closing balance translated at closing rates of: June 2008: US$1 = R7.80 (March
2008: US$1 = R8.14, June 2007: US$1 = R7.04)
DETAILED OPERATING INFORMATION YEAR ENDED 30 JUNE 2008 (US$/Imperial)
Cash Cash
Continuing operating operating Capital
Operations Revenue cost profit/(loss) expenditure
South Africa US$ million US$ million US$ million US$ million
Tshepong 223 125 98 27
Phakisa 4 2 2 40
Doornkop 35 31 4 48
Elandsrand 133 103 30 44
Target 69 51 18 35
Masimong 96 88 8 16
Evander
Operations
Evander 5 50 36 14 6
Evander 7 43 32 11 11
Evander 8 100 59 41 16
Total Evander
Operations 193 127 66 33
Bambanani 128 102 26 15
Joel 52 39 13 5
Virginia
Operations
Harmony 2 39 36 3 5
Merriespruit 1 39 33 6 4
Merriespruit 3 33 31 2 3
Unisel 55 44 11 5
Brand 3 38 35 3 3
Brand 5 - 1 (1) -
Total Virginia
Operations 204 180 24 20
St Helena 6 13 (7) 1
Kalgold 77 38 39 1
Project
Phoenix 26 12 14 -
Other entities 23 7 16 18
Total South
Africa 1 269 918 351 303
International
PNG - - - 197
Total
International - - - 197
Total Harmony
- Continuing
Operations 1 269 918 351 500
Continuing Gold Tonnes Operating
Operations Produced milled Grade cost
South Africa Ounces (Imperial) (Imperial) $/ounce
Tshepong 273 119 1 649 0.166 457
Phakisa 4 212 34 0.123 558
Doornkop 44 143 494 0.089 703
Elandsrand 158 631 981 0.162 652
Target 85 006 686 0.124 605
Masimong 117 575 892 0.132 745
Evander Operations
Evander 5 60 572 382 0.159 588
Evander 7 56 971 309 0.185 557
Evander 8 122 494 756 0.162 478
Total Evander
Operations 240 037 1 447 0.166 525
Bambanani 158 985 912 0.174 641
Joel 61 215 449 0.136 639
Virginia Operations
Harmony 2 48 129 487 0.099 749
Merriespruit 1 47 036 427 0.110 700
Merriespruit 3 40 445 429 0.094 778
Unisel 67 613 547 0.124 648
Brand 3 47 101 459 0.103 734
Brand 5 - - - -
Total Virginia
Operations 250 324 2 349 0.107 719
St Helena 8 359 86 0.097 1 523
Kalgold 93 172 1 687 0.055 411
Project Phoenix 32 215 7 033 0.005 381
Other entities 23 534 804 0.029 309
Total South Africa 1 550 527 19 503 0.080 591
International
PNG - - - -
Total International - - - -
Total Harmony
- Continuing
Operations 1 550 527 19 503 0.080 591
Cash Cash
Discontinued operating operating Capital
Operations Revenue cost profit/(loss) expenditure
South Africa US$ million US$ million US$ million US$ million
Orkney 2 18 21 (3) 1
Orkney 4 15 20 (5) 1
Orkney 7 7 11 (4) 2
Cooke 1 49 32 17 2
Cooke 2 49 28 21 5
Cooke 3 68 45 23 15
Cooke Plant
Operations 28 18 10 -
Total South
Africa 234 175 59 26
Australia
Mt Magent 56 41 15 4
South Kal 19 14 5 12
Total
Australia 75 55 20 16
Total Harmony
- Discontinued
Operations 309 230 79 42
Total Harmony 1 578 1 148 430 542
Discontinued Gold Tonnes Operating
Operations Produced milled Grade cost
South Africa Ounces (Imperial) (Imperial) $/ounce
Orkney 2 26 717 176 0.152 769
Orkney 4 20 480 215 0.095 977
Orkney 7 9 935 180 0.055 1 140
Cooke 1 59 221 328 0.181 538
Cooke 2 59 832 376 0.159 461
Cooke 3 82 884 619 0.134 540
Cooke Plant
Operations 34 305 2 583 0.013 520
Total South Africa 293 374 4 477 0.066 593
Australia
Mt Magent 77 097 966 0.080 537
South Kal 27 778 477 0.058 517
Total Australia 104 875 1 443 0.073 532
Total Harmony
- Discontinued
Operations 398 249 5 920 0.067 576
Total Harmony 1 948 776 25 423 0.077 589
DETAILED OPERATING INFORMATION YEAR ENDED 30 JUNE 2007 (US$/Imperial)
Cash Cash
Continuing operating operating Capital
Operations Revenue cost profit/(loss) expenditure
South Africa US$ million US$ million US$ million US$ million
Tshepong 203 112 91 26
Phakisa - - - 32
Doornkop 37 25 12 38
Elandsrand 124 103 21 33
Target 91 53 38 16
Masimong 95 82 13 15
Evander Operations
Evander 5 36 29 7 5
Evander 7 39 38 1 12
Evander 8 76 46 30 11
Total Evander
Operations 151 113 38 28
Bambanani 126 115 11 17
Joel 51 33 18 4
Virginia Operations
Harmony 2 30 30 - 5
Merriespruit 1 33 27 6 4
Merriespruit 3 28 25 3 3
Unisel 51 35 16 5
Brand 3 29 28 1 2
Brand 5 1 2 (1) -
Total Virginia
Operations 172 147 25 19
St Helena 14 18 (4) 1
Kudu/Sable 1 - 1 -
Kalgold 36 27 9 -
Project Phoenix 13 6 7 -
Other entities 2 2 - 18
Total South Africa 1 116 836 280 247
International
PNG - - - 73
Total international - - - 73
Total Harmony
- Continuing
Operations 1 116 836 280 320
Continuing Gold Tonnes Operating
Operations Produced milled Grade cost
South Africa Ounces (Imperial) (Imperial) $/ounce
Tshepong 318 887 1 824 0.175 351
Phakisa - - - -
Doornkop 57 364 597 0.096 439
Elandsrand 194 710 1 117 0.174 527
Target 142 433 904 0.158 370
Masimong 147 958 1 074 0.138 559
Evander Operations
Evander 5 55 707 377 0.148 519
Evander 7 61 044 447 0.137 633
Evander 8 118 692 843 0.141 386
Total Evander
Operations 235 443 1 667 0.141 481
Bambanani 197 060 1 283 0.154 586
Joel 79 923 504 0.158 418
Virginia Operations
Harmony 2 46 274 516 0.089 646
Merriespruit 1 50 612 476 0.106 524
Merriespruit 3 43 541 444 0.098 575
Unisel 79 992 614 0.130 438
Brand 3 45 611 445 0.103 609
Brand 5 918 12 0.077 1 651
Total Virginia
Operations 266 948 2 507 0.106 546
St Helena 21 319 241 0.089 840
Kudu/Sable 845 16 - -
Kalgold 56 129 1 740 0.032 485
Project Phoenix 21 346 2 368 0.009 293
Other entities 6 706 458 0.015 252
Total South Africa 1 747 071 16 300 0.107 479
International
PNG - - - -
Total international - - - -
Total Harmony
- Continuing
Operations 1 747 071 16 300 0.107 479
Cash Cash
Discontinued operating operating Capital
Operations Revenue cost profit/(loss) expenditure
South Africa US$ million US$ million US$ million US$ million
Orkney 2 34 26 8 4
Orkney 3 - - - -
Orkney 4 30 26 4 5
Orkney 7 13 12 1 6
ARM surface - - - -
Cooke 1 48 33 15 2
Cooke 2 36 35 1 3
Cooke 3 58 44 14 14
Cooke Plant
Operations 12 6 6 -
Total South
Africa 231 182 49 34
Australia
Mt Magent 86 71 15 20
South Kal 56 45 11 7
Total
Australia 142 116 26 27
Total Harmony
- Discontinued
Operations 373 298 75 61
Total Harmony 1 489 1 134 355 381
Discontinued Gold Tonnes Operating
Operations Produced milled Grade cost
South Africa Ounces (Imperial) (Imperial) $/ounce
Orkney 2 52 275 311 0.168 504
Orkney 3 - - - -
Orkney 4 46 041 397 0.116 572
Orkney 7 20 668 239 0.086 578
ARM surface 125 1 - -
Cooke 1 75 698 425 0.178 434
Cooke 2 57 215 385 0.149 610
Cooke 3 91 332 622 0.147 483
Cooke Plant
Operations 18 974 895 0.021 305
Total South Africa 362 328 3 275 0.111 503
Australia
Mt Magent 136 428 1 874 0.073 518
South Kal 88 371 1 391 0.064 504
Total Australia 224 799 3 265 0.069 507
Total Harmony
- Discontinued
Operations 587 127 6 540 0.090 507
Total Harmony 2 334 198 22 840 0.102 489
DEVELOPMENT RESULTS
(Metric)
Quarter ended June 2008
Channel Channel
Reef Sampled Width Value Gold
Metres Metres (Cm`s) (g/t) (Cmg/t)
Randfontein
VCR Reef 837 894 50 36.03 1,819
UE1A 918 909 186 4.10 762
E8 Reef 54 54 121 9.53 1,153
Kimberley Reef 55 126 59 5.66 334
E9GB Reef 264 203 84 13.67 1,155
All Reefs 2,129 2,186 112 10.83 1,216
Free State
Basal 1,775 1,198 67 15.81 1,065
Leader 1,312 984 167 5.89 985
A Reef 366 284 89 7.15 639
Middle 25 12 148 51.84 7,673
B Reef 69 66 227 0.24 54
All Reefs 3,547 2,544 113 8.78 991
Evander
Kimberley Reef 887 1,050 73 15.48 1,134
Elandskraal
VCR Reef 539 532 135 12.50 1,688
Orkney
Vaal Reef - - - - -
VCR - - - - -
All Reefs - - - - -
Target
Elsburg 116 74 293 3.28 962
Freegold JV
Basal 1,334 1,076 22 52.86 1,180
Beatrix 425 360 123 8.48 1,040
Leader
B Reef 121 154 35 143.84 5,105
All Reefs 1,880 1,590 46 33.01 1,529
DEVELOPMENT RESULTS
(Imperial)
Quarter ended June 2008
Channel Channel
Reef Sampled Width Value Gold
Feet Feet (inches) (oz/t)(in.ozt)
Randfontein
VCR Reef 2,747 2,933 20 1.04 21
UE1A 3,012 2,982 73 0.12 9
E8 Reef 177 177 48 0.27 13
Kimberley Reef 181 413 23 0.17 4
E9GB Reef 866 666 33 0.39 13
All Reefs 6,983 7,172 44 0.32 14
Free State
Basal 5,824 3,930 27 0.45 12
Leader 4,304 3,228 66 0.17 11
A Reef 1,201 932 35 0.21 7
Middle 83 39 58 1.52 88
B Reef 226 217 89 0.01 1
All Reefs 11,638 8,346 44 0.26 11
Evander
Kimberley Reef 2,910 3,445 29 0.45 13
Elandskraal
VCR Reef 1,768 1,745 53 0.37 19
Orkney
Vaal Reef - - - - -
VCR - - - - -
All Reefs - - - - -
Target
Elsburg 379 243 115 0.10 11
Freegold JV
Basal 4,377 3,530 9 1.51 14
Beatrix 1,394 1,181 48 0.25 12
Leader - - - - -
B Reef 397 505 14 4.19 59
All Reefs 6,168 5,217 18 0.98 18
CONTACT DETAILS
Harmony Gold Mining Company Limited
Corporate Office
PO Box 2
Randfontein, 1759
South Africa
Corner Main Reef Road
and Ward Avenue
Randfontein, 1759
Johannesburg
South Africa
Telephone: +27 11 411 2000
Website: http://www.harmony.co.za
Directors
P T Motsepe (Chairman)*
G Briggs (Chief Executive Officer)
F Abbott, J A Chissano*1,
F T De Buck*, Dr D S Lushaba*
C Markus*, M Motloba*,
C M L Savage*, A J Wilkens*
Dr C Diarra*2 , K V Dicks*
(*non-executive)
1. (Mozambique)
2. (US/Mali Citizen)
Further Information
Amelia Soares
General Manager, Investor Relations
Telephone: +27 11 411 2314
Cell: +27 (0) 82 654 9241
E-mail: amelia.soares@harmony.co.za
Marian van der Walt
Company Secretary
Telephone: +27 11 411 2037
Fax: +27 11 411 2070
Cell: +27 (0) 82 888 1242
E-mail: marian.vanderwalt@harmony.co.za
South African Share Transfer Secretaries
Link Market Services South Africa (Proprietary) Limited
(Registration number 2000/007239/07)
5th Floor, 11 Diagonal Street
Johannesburg, 2001
South Africa
PO Box 4844
Johannesburg, 2000
South Africa
Telephone: +27 11 832 2652
Fax: +27 11 834 4398
United Kingdom Registrars
Capita Registrars
The Registry
34 Beckenham Road
Beckenham
Kent BR3 4TU
United Kingdom
Telephone: +44 870 162 3100
Fax: +44 208 639 2342
ADR Depositary
The Bank of New York
101 Barclay Street
New York, NY 10286
United States of America
Telephone: +1888-BNY ADRS
Fax: +1 212 571 3050
Trading Symbols
JSE Limited HAR
New York Stock Exchange, Inc. HMY
NASDAQ HMY
London Stock Exchange plc HRM
Euronext Paris HG
Euronext Brussels HMY
Berlin Stock Exchange HAM1
Issuer code HAPS
Registration number 1950/038232/06
Incorporated in the Republic of South Africa
ISIN: ZAE000015228
Date: 15/08/2008 08:55:02 Supplied by www.sharenet.co.za
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