Harmony Gold’s earnings soar, shares climb

Harmony Gold SENS statement: 

Trading statement and operating update for the six months ended 31 December 2020

Johannesburg, Friday, 19 February 2021. Harmony Gold (“Harmony” or the “Company”) is required in terms of paragraph 3.4(b) of the Listings Requirements of the JSE Limited, to publish a trading statement as soon as the Company is satisfied that a reasonable degree of certainty exists that the financial results for the period to be reported upon next – being its interim results for the six months ended 31 December 2020 (“H1FY21”)- will differ by at least 20% from the financial results for the comparable six months ended 31 December 2019 (“the previous comparable period” and/or “H1FY20”).

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Expected headline and basic earnings for the six-month period ended 31 December 2020 (“H1FY21”)

Shareholders of Harmony are advised that a reasonable degree of certainty exists that net profit for H1FY21 will be between R5.7bn and R5.9bn – which is between 325% and 339% higher than H1FY20. In US dollar terms, net profit for H1FY21 is estimated to be between 283% and 297% higher at $349m to $361m in comparison to H1FY20.

Headline earnings per share (“HEPS”) is expected to be between 761 and 795 South African (“SA”) cents or between 205% and 219% higher than the previous comparable period (which was 249 South African cents). In US dollar terms, HEPS is expected to be between 47 and 49 US cents per share or 175% and 189% higher than the previous comparable period (which was 17 US cents).

Earnings per share (“EPS”) is expected to be between 942 and 976 South African cents per share or 278% and 292% higher than the previous comparable period (which was 249 South African cents). In US dollar terms, EPS is expected to be between 58 and 60 US cents per share or between 240% and 254% higher than the previous comparable period (which was 17 US cents).

The increase in net profit and earnings is primarily due to:

  • an increase in production;
  • a higher average gold price received;
  • gains on derivatives and foreign exchange translation gain; and
  • a gain on bargain purchase recognised on the acquisition of Mponeng and related operations.
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