Harmony Gold Strikes It Rich: Profits Soar Amid Record Gold Prices

Harmony Gold, one of South Africa’s leading gold miners, is riding high on the wave of record gold prices, with profits expected to surge by up to 42% for the six months ended 31 December 2024. The group attributes this impressive performance to consistent production, operational excellence, and a significant increase in the average gold price received.

A Golden Performance

Harmony Gold announced that its earnings per share (EPS) and headline earnings per share (HEPS) are expected to increase by 24% to 42% for H1FY25. This translates to EPS of 1,182 to 1,355 cents and HEPS of 1,188 to 1,361 cents, up from 956 cents in H1FY24.

The average gold price received during the period rose by 23%, from R1,141,424/kg in H1FY24 to R1,405,020/kg in H1FY25. This increase was driven by strong global demand and economic uncertainties, which have pushed gold prices to record highs.

Balancing Costs and Taxes

While the higher gold price has been a boon for Harmony Gold, the group noted that the profit increase was partially offset by rising production costs and higher income and royalty taxes. Despite these challenges, the company’s disciplined approach to cost management and capital allocation has enabled it to generate robust operating free cash flows.

“Our disciplined approach to capital allocation has allowed us to leverage the current high gold price environment to generate exceptionally strong operating free cash flows,” said Beyers Nel, CEO of Harmony Gold.

Operational Excellence and Safety

Harmony Gold’s success is also rooted in its commitment to operational excellence and safety. The group has consistently invested in improving safety standards and optimizing production processes across its operations. This focus has resulted in higher-quality ounces and stable, predictable cost structures.

“We have a stable, rand-based cost structure and have been delivering operational consistency across the entire group,” Nel added. “Our continuous investment in safety and operational excellence has been key to our success.”

Harmony Gold will release its full financial results for H1FY25 on Tuesday, 4 March 2025. The group’s strong performance underscores its resilience and ability to capitalize on favorable market conditions.

A Bright Future for Harmony Gold

Harmony Gold’s impressive results highlight the company’s strategic focus on quality production, cost efficiency, and leveraging high gold prices. As global economic uncertainties continue to drive demand for gold, Harmony Gold is well-positioned to maintain its upward trajectory.

“The outstanding H1FY25 results are a testament to our commitment to delivering value to our stakeholders,” Nel concluded. “We remain focused on sustaining our operational excellence and capitalizing on opportunities in the gold market.”

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