Harmony makes a run for it
Athletes have become the first casualty of mining company Harmony’s drastic drive to cut its soaring costs. The company has decided to rid itself of about 40 star athletes on its payroll and invest in developing talent.
“Harmony is withdrawing its sponsorship of professional athletes, but will continue to sponsor development clubs as they do a large amount of development work in their communities,” Amelia Soares, Harmony Gold Mine investor relations general manager, told the Mail & Guardian.
The Financial Mail reported last month that Harmony Gold had recorded a net profit of R341-million in the 2007 financial year—the first profit in three years—but the company’s operating costs skyrocketed to R1,8-billion. The company sold its Gold Fields shares, raising R1,3-billion, which was used to pay rising debts.
The decision to dump professional runners is part of an effort to cut down on Harmony’s high costs. The company spent about R2-million last year for the athletics club.
Soares said an audit of the number of sponsorships Harmony has—as well as which of these should be continued and which terminated—is under way. It is expected to be completed by the end of September. Only then will decisions be made about what will stay.
The athletics club is made up of prominent runners such as Bethuel Netshifhefhe, winner of the 2007 Two Oceans marathon, 1996 Olympic marathon champion Josiah Thugwana and Sipho Ngomane, the winner of the 2005 Comrades Marathon.
Professional runners at Harmony earn between R500 and R14 000 a month, depending on experience.
Nick Bester, Harmony’s athletics club manager, said: “There are about 40 professional runners who get a monthly salary from Harmony and this means that they will be left jobless. They depend highly on the race incentives and the bonuses they get upon winning the races.
“This will be very bad for our athletes in South Africa because they are doing very well and depend on the sponsorship.”
Nine-times Comrades Marathon winner Bruce Fordyce described this as “a huge blow to athletics in South Africa”.
“The only big sponsor left is Mr Price and it has its own runners and it won’t be easy for Mr Price to accommodate them [Harmony’s],” he said.
But Athletics South Africa chief executive Leonard Chuene welcomed the decision by Harmony to focus more on developing young athletes.
“You cannot continue sponsoring Olympic champions when there are promising athletes who need sponsors. It’s about time we focused more on young athletes. Gone are the days when you would see Harmony getting athletes from outside South Africa and paying them huge amounts of money to run for Harmony,” he said.
“Young athletes from Kenya are always given an opportunity to prove themselves and they don’t worry about money. Let’s give youngsters a chance and let go of the professionals. The money that goes towards these athletes should go towards developing athletes,” he added.