Harmony has made record production despite having downscaled some of its ”marginal shafts”, with production increasing for the seventh year in a row, the company said on Monday.
The company said in a statement that 3,3-million ounces of gold, 11% more than the previous year, were produced during the financial year ended on June 30 2004.
However, according to the company’s investor relations manager, Corne Bobbert, revenues decreased by 12% from R96 663/kg to R85 219/kg.
Bobbert said the strength of the rand has ”impacted adversely on what can be described as a difficult but rewarding 12 months”.
”As a result of the growth in production, the company managed to sustain revenue levels,” said Bobbert. ”The negative impact of the strengthening … rand on revenue was evident where the price received quarter-on-quarter was 8% lower at R81 543/kg.”
Harmony’s chief executive, Bernard Swanepoel, said despite the 7% annual wage increase, benefits from the restructuring are expected to begin showing during the September quarter.
Swanepoel said cash costs are expected to be reduced to below R80 000/kg.
”The past six months has probably been the most difficult period we have experienced in our recent history,” he said.
”Over the past few years we have built up a track record of paying dividends in good and in challenging times and proved that we can survive and grow the company,” said Swanepoel, adding it is appropriate for the company to pay 30 cents per share this year.
”By continuing our capital expenditure programmes, we aim to optimise the value from these growth projects,” he said.
Bobbert said the company has increased its capital expenditure by 68%, from R519-million to R871-million, and higher recovery grades and lower working costs are anticipated in the ”next few years”. — Sapa