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Harmony CEO Peter Steenkamp.

Harmony CEO Peter Steenkamp.

The Harmony Gold strategy of allocating growth capital towards high-margin, long-life assets has started to deliver the desired results.

Good recovered underground grades along with the strong rand-per-kilogram gold price have provided Harmony with tailwinds.

“Execution excellence and sustainable mining practices will ensure that we achieve our annual production and cost guidance for the 2023 financial year,” said Harmony CEO Peter Steenkamp on Wednesday, when the JSE-listed gold mining company announced its financial and operating results for the six-month period ended December 31.

Net profit of R1.9-billion was up on the previous R1.4-billion on a 6% increase in revenue to R23.3-billion.

Production profit rose 7% to R5.4-billion and net debt to earnings before interest, taxes, depreciation and amortisation, or Ebitda, increased to 0.6x from 0.1x on the acquisition of Eva Copper in Northern Queensland, Australia.

Headline earnings a share rose 18% to 293c and earnings a share increased 31% to 298c.

No interim dividend was declared owing to the allocation of capital towards near-term copper and growth projects.

Phase 1 of a 30 MW solar power plant is to be commissioned before the end of June.

Gold revenue was up 6% to R22 750-million and underground operating free cash flow rose 33% to R1 858-million driven by higher recovered grades, which rose 5% to 5.68 g/t from 5.39 g/t.

Production at Mponeng gold mine rose 8% on the better recovered grade and higher tonnes.

Optimised operations continued to perform well following the Joel turnaround and the separation of Tshepong North and Tshepong South gold mines.

Total gold production was down 5% to 23 037 kg, or 740 655 oz, owing mainly to the closure of Bambanani gold mine.

The average gold price received rose 12% to R963 439/kg or $1 730/oz and all-in sustaining costs rose 11% to R890 735/kg ($1 600/oz).