Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
South Africa’s Harmony Gold expects profit for the six months to Dec. 31 to have risen by as much as 30%, it said on Thursday, with higher metal grades and prices offsetting increased production costs.
Harmony Gold said headline earnings per share (HEPS)- the most common profit measure in South Africa – are expected to come in between 2.72 rand ($0.1483) and 3.22 rand ($0.1755), compared with 2.48 rand in the same period of the previous financial year.
The South African miner, which also has operations in Papua New Guinea, said it was on track to meet annual production guidance between 1.4 million and 1.5 million ounces in its financial year to June 30.
Gold output was between 720,000 ounces and 745,000 ounces for the half year to Dec. 31.
Harmony expects to report a 10% jump in production costs, though its “all-in sustaining costs”, an industry measure of costs, is likely to be less than its cost guidance of 900,000 rand per kilogram.
Harmony Gold is scheduled to release half-year results on March 1.
($1 = 18.3433 rand)
(By Nelson Banya; Editing by David Goodman)
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