Blueprint
UNITED
STATES
SECURITIES AND
EXCHANGE COMMISSION
Washington, D.C.
20549
Form 6-K
REPORT OF FOREIGN
PRIVATE ISSUER PURSUANT TO
RULE 13a-16 OR
15d-16 UNDER THE SECURITIES
EXCHANGE ACT OF
1934
For August 17,
2018
Harmony Gold Mining Company
Limited
Randfontein
Office Park
Corner Main Reef
Road and Ward Avenue
Randfontein,
1759
South
Africa
(Address of principal executive
offices)
*-
(Indicate by
check mark whether the registrant files or will file annual reports
under cover of Form 20- F or Form 40-F.)
(Indicate by
check mark whether the registrant by furnishing the information
contained in this form is also thereby furnishing the information
to the Commission pursuant to Rule 12g3-2(b) under the Securities
Exchange Act of 1934.)
Harmony Gold
Mining Company Limited
Registration
number 1950/038232/06
Incorporated in
the Republic of South Africa
ISIN:
ZAE000015228
JSE share code:
HAR
(“Harmony”
and/or “the Company”)
Operating overview and trading statement for the year ended 30 June
2018
Johannesburg, Friday, 17 August 2018.
Harmony Gold Mining Company Limited (“Harmony” or the
“Company”) announces an update on its operating results
related to all-in sustaining unit costs and provides a trading
statement relating to its financial year June 2018
(“FY18”).
Overview of FY18 performance
In FY18 Harmony
delivered a strong production performance and achieved two
significant milestones in driving the Company’s strategy to
produce safe, profitable ounces and increase margins:
-
the Hidden Valley
re-investment was delivered safely, below budget and ahead of
schedule; and
-
the acquisition of the Moab
Khotsong operations and its successful integration into
Harmony’s portfolio.
These two
investments enhance the quality of the Company’s portfolio
and are already contributing to strengthening Harmony’s
results. In FY18, Harmony achieved an all-in sustaining unit cost
of
R508 970/kg (US$1
231/oz), beating annual guidance of R520 000/kg and beating the
all-in sustaining unit cost of R516 687/kg (US$1 182/oz) reported
for the June 2017 financial year.
Harmony achieved
its production guidance for the third consecutive year and
increased its underground recovered grade by 8% (an increase in
grade for a sixth consecutive year).
Headline and basic earnings
In terms of
paragraph 3.4(b) of the Listings Requirements of the JSE Limited
(JSE), a company listed on the JSE is required to publish a trading
statement as soon as they are satisfied that a reasonable degree of
certainty exists that the financial results for the period to be
reported upon next will differ by at least 20% from the financial
results for the previous corresponding period.
Shareholders of
Harmony are advised that a reasonable degree of certainty exists
that earnings for the year ended 30 June 2018 (“FY18”)
will be lower than for the year ended 30 June 2017 (“the
previous comparable period” or “FY17”) primarily
due to once-off non-cash impairments, a reported translation loss
on the US$ denominated debt at 30 June 2018 and lower derivative
gains recorded in FY18. The recorded impairments reduce the net
profit of the Company but have no impact on reported cash balances
and free cash flow.
Headline earnings
per share (“HEPS”) are expected to be between 164 and
179 South African cents – a year on year decrease of
approximately 40% to 45% reported for the previous comparable
period (which was 298 South African cents). In US dollar terms,
HEPS are expected to be between 12 and 14 US cents per share, which
is between 35% to 45% lower than the headline earnings of 21 US
cents per share reported for the previous comparable
period.
Earnings per
share (“EPS”) are expected to decrease to a loss of
between 995 and 1 011 South African cents per share, which is more
than a 100% lower than the 82 South African cents per share
reported for the previous comparable period. In US dollar terms,
the loss per share is expected to be between 68 and 84 US cents per
share, which is more than 100% lower than the earnings of 4 US
cents per share reported for the previous comparable
period.
Impairments
The life-of-mine
plans form the basis for assessing whether any impairment against
the carrying value of an asset is required. These values are
informed by a number of factors, including estimates of future gold
prices and exchange rates and operating and capital cost
estimates.
An impairment of
R5.3 billion (US$386 million) was recorded at Harmony’s
Tshepong Operations, Target 1, Joel, Kusasalethu, Unisel, Masimong,
Doornkop, and the Target North undeveloped property. The
impairments were mainly driven by forecasted cost inflation and a
subdued gold price of R535 000/kg ($1 250 at R/$13.30) applied in
the Company’s life-of-mine plans and the resultant impact on
margins. Furthermore, in the case of Target North and Doornkop,
lower resource multiples were applied to estimate the value of the
resources. The values per resource ounce have decreased
substantially as a result of the low levels of merger and
acquisition activity of resource companies in South Africa, and
more specifically gold mining companies.
Translation loss
A translation
loss of approximately R669 million was recognised on the US$
denominated debt as at 30 June 2018, compared to a translation gain
of R215 million recorded in the previous comparable
period.
Lower derivative gains
Included in FY17
were derivative gains of R1.1 billion (US$75 million) compared to
R0.1 billion (US$8 million) in FY18.
The financial
information on which this trading statement has been based has not
been reviewed or reported on by Harmony’s external
auditors.
Harmony will
publish its production and financial results for the year ended 30
June 2018 on Tuesday, 21 August 2018.
For more details
contact:
Lauren
Fourie
Investor
Relations Manager
+27(0)71 607 1498
(mobile)
Marian van der
Walt
Executive:
Investor Relations
+27(0)82 888 1242
(mobile)
Johannesburg,
South Africa
17 August
2018
Sponsor:
J.P. Morgan
Equities South Africa Proprietary Limited
SIGNATURES
Pursuant to the
requirements of the Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly
authorized.
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Harmony Gold Mining Company
Limited
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Date: August 17,
2018
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By:
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/s/ Frank Abbott
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Name
Frank
Abbott
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Title
Financial
Director
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