Harmony Gold Mining Company Ltd HY 2014 financial results presentation

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Harmony Gold Mining Company Ltd HY 2014 financial results presentation

  1. 1. Q2 FY14 GRAHAM BRIGGS FRANK ABBOTT 3 February 2014 1 FY14 Q1 Q2 Q3 Q4 w w w . h a r m w n y . ch a z m o n y . c o . z a o ww. o. ra
  2. 2. Private Securities Litigation Reform Act Safe Harbour Statement This presentation contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and 21E of the Securities Exchange Act of 1934, as amended, that are intended to be covered by the safe harbour created by such sections. These statements may be identified by words such as “expects”, “looks forward to”, “anticipates”, “intends”, “believes”, “seeks”, “estimates”, “will”, “project” or words of similar meaning. All statements other than those of historical facts included in this presentation are forward-looking statements, including, without limitation, (i) estimates of future earnings, and the sensitivity of earnings to the gold and other metals prices; (ii) estimates of future gold and other metals production and sales, (iii) estimates of future cash costs;( iv) estimates of future cash flows, and the sensitivity of cash flows to the gold and other metals prices; (v) statements regarding future debt repayments; (vi) estimates of future capital expenditures; and (vii) estimates of reserves, and statements regarding future exploration results and the replacement of reserves. Where the Company expresses or implies an expectation or belief as to future events or results, such expectation or belief is expressed in good faith and believed to have a reasonable basis. However, forward-looking statements are subject to risks, uncertainties and other factors, which could cause actual results to differ materially from future results expressed, projected or implied by such forward-looking statements. Such risks include, but are not limited to, gold and other metals price volatility, currency fluctuations, increased production costs and variances in ore grade or recovery rates from those assumed in mining plans, project cost overruns, as well as political, economic and operational risks in the countries in which we operate and governmental regulation and judicial outcomes. For a more detailed discussion of such risks and other factors (such as availability of credit or other sources of financing), see the Company's latest Annual Report on Form 20-F for the year ended June 30, 2013 which is on file with the Securities and Exchange Commission, as well as the Company's other SEC filings. The Company does not undertake any obligation to release publicly any revisions to any "forward-looking statement" to reflect events or circumstances after the date of this presentation, or to reflect the occurrence of unanticipated events, except as may be required under applicable securities laws. FY14 Q1 Q2 Q3 Q4 www.harmony.co.za 2
  3. 3. Agenda 1 Pragmatic mining 2 Profitable ounces 3 Focus on growth in margin 4 Wafi-Golpu 5 Financial results 6 Conclusion FY14 Q1 Q2 Q3 Q4 www.harmony.co.za 3
  4. 4. Pragmatic mining www.harmony.co.za
  5. 5. Our strategy = growing our margin A globally competitive gold mining company – growth in profits, paying dividends to shareholders Optimise operational delivery Safely delivering on projects and operational plans Growth Growth in margin (free cash flow) Sharing rewards Sharing profits with stakeholders Experienced teams with strong values; committed to deliver FY14 Q1 Q2 Q3 Q4 www.harmony.co.za 5
  6. 6. Driving costs down (R/kg) R/kg All-in sustaining costs 480 000 471 150 460 000 440 000 420 000 404 700 400 000 397 500 380 000 360 000 340 000 320 000 300 000 FY14 Q1 Q2 Q3 Q4 Jun-13 Sep-13 Dec-13 www.harmony.co.za 6
  7. 7. Driving costs down (US$/oz) All-in sustaining costs US$/oz 1 600 1 551 1 500 1 400 1 300 1 264 1 222 1 200 1 100 1 000 FY14 Jun-13 Q1 Q2 Q3 Q4 Sep-13 Dec-13 www.harmony.co.za 7
  8. 8. We remain agile All-in sustaining costs Mines currently operating Comments at these levels Less than US$1000/oz Joel, Target 1, Steyn 2, Bambanani, Phoenix, • Operating at below US$1000/oz Less than US$1250/oz Hidden Valley, Kalgold, Dumps, Unisel • Predicting an all in sustaining cost of $1100/oz by end FY14 • Our total all-in sustaining cost average is below $1250/oz FY14 Q1 Q2 Q3 Q4 www.harmony.co.za 8
  9. 9. We remain agile, cont‟d All-in sustaining costs Mines currently operating at these levels Comments > US$1250/oz Phakisa, Tshepong, Masimong, Doornkop Operations with an all-in sustaining cost of higher than $1250/oz will be restructured: • Phakisa continues to spend capital on its build-up and should reach the $1250/oz to $1300/oz mark by financial year end • Management changes and restructuring at Tshepong finalised • Doornkop restructured to eliminate the lowest grade tonnage; Masimong to follow suit > US$1600/oz Kusasalethu Target 3 • Management changes and technical issues addressed at Kusasalethu and costs will reduce as production builds up • Target 3 to be restructured post quarter end to eliminate lowest grade tonnage FY14 Q1 Q2 Q3 Q4 www.harmony.co.za 9
  10. 10. Profitable ounces www.harmony.co.za
  11. 11. Safety – our core value − Executive-led safety audits − Dedicated safety executive − Reward and recognition initiatives − Increase in safety messaging − Non-compliance results in dismissals − Reduced fatality and lost time injury frequency rates q-on-q FY14 Q1 Q2 Q3 Q4 www.harmony.co.za 11
  12. 12. Group operating results (6 monthly) Six months ended Dec 2013 Six months ended Jun 2013 % change Gold price Cash operating costs Underground recovery grade Operating profit¹ All-in sustaining costs Exchange rate 19 150 16 287 18 oz 615 686 523 638 18 R/kg 422 386 447 913 (6) 1 309 1 518 (14) 316 517 352 619 10 981 1 194 18 4.69 4.43 6 2 022 1 524 33 201 167 20 401 021 474 390 15 US$/oz Gold produced kg 1 242 1 606 23 R/US$ 10.04 9.19 9 US$/oz R/kg US$/oz g/t Rm US$m R/kg ¹ Operating profit is comparable to the term production profit in the segment report in the financial statements and not to the operating profit line in the income statement FY14 Q1 Q2 Q3 Q4 www.harmony.co.za 12
  13. 13. Group operating results (q-on-q) Dec 2013 Sep 2013 % change Gold price Cash operating costs Underground recovery grade Operating profit¹ All-in sustaining costs Exchange rate 9 515 9 635 (1) oz 305 913 309 773 (1) R/kg 415 532 429 566 (3) 1 277 1 342 (5) 308 665 324 272 5 949 1 013 6 g/t 4.85 4.55 7 Rm 986 1 037 (5) 97 104 (7) 397 503 404 694 2 US$/oz Gold produced kg 1 222 1 264 3 R/US$ 10.12 9.96 2 US$/oz R/kg US$/oz US$m R/kg ¹ Operating profit is comparable to the term production profit in the segment report in the financial statements and not to the operating profit line in the income statement FY14 Q1 Q2 Q3 Q4 www.harmony.co.za 13
  14. 14. Upward trend in underground grade g/t 4.9 4.85 4.79 4.8 4.7 4.6 4.55 4.5 4.4 4.37 4.3 4.2 4.1 4 FY14 Jun-13 Q1 Q2 Q3 Q4 Sep-13 Dec-13 FY14 forecast www.harmony.co.za 14
  15. 15. Stable production (kg) 10 000 9 500 9 000 1 272 1 140 8 363 8 375 Sep-13 Dec-13 8 500 688 8 000 49 7 500 7 000 7 900 7 650 6 500 6 000 Mar-13 Jun-13 Kusasalethu Note: Guidance for FY14: 1.2 – 1.3moz FY14 Q1 Q2 Q3 Q4 Harmony excluding Kusasalethu www.harmony.co.za 15
  16. 16. Stable production (oz) 330 000 310 000 290 000 40 896 268 877 270 000 250 000 36 652 269261 Sep-13 Dec-13 22 120 1 575 230 000 210 000 253 989 245 954 190 000 170 000 150 000 Mar-13 Jun-13 Kusasalethu Note: Guidance for FY14: 1.2 – 1.3moz FY14 Q1 Q2 Q3 Q4 Harmony excluding Kusasalethu www.harmony.co.za 16
  17. 17. Lowest cost producer (R/tonne) in SA All-in sustaining costs R/tonne 3 500 2 893 3 000 2 914 Jun-13 Sep-13 2 500 2 000 2 052 1 876 2 004 Jun-13 Sep-13 1 745 1 500 1 000 500 - Jun-13 Sep-13 Harmony Sibanye Gold AngloGold¹ Note: Harmony has a 30 June year end, while Sibanye and Anglogold have 31 December year ends ¹ Project capital for Anglogold has been included Source: BNP Paribas Cadiz Securities FY14 Q1 Q2 Q3 Q4 www.harmony.co.za 17
  18. 18. Focus on growth in margin www.harmony.co.za
  19. 19. Growing our margins (R/kg) 600 000 400 000 503 058 526 404 533 624 500 000 All-in sustaining costs R/kg 397 503 241 303 263 910 278 028 280 299 299 632 373 246 386 310 393 782 200 000 394 820 416 838 447 878 458 501 300 000 100 000 - All-in sustaining cost R/kg FY14 Q1 Q2 Q3 Q4 Quarter average revenue R/kg www.harmony.co.za 19
  20. 20. Growing our margins (US$/oz) 1 800 1 546 1 618 1 400 1 640 1 600 All-in sustaining cost US$/oz 1 222 1 147 1 187 1 210 1 000 1 209 1 281 1 376 1 409 1 200 742 600 811 854 861 921 800 400 200 - All-in sustaining cost US$/oz FY14 Q1 Q2 Q3 Q4 Quarter average revenue US$/oz www.harmony.co.za 20
  21. 21. R/US$ exchange rate gearing All-in sustaining costs of R398 000/kg (SA only) at different exchange rates US$/oz 1 500 1 400 1 374 1 300 1 222 1 178 1 200 1 125 1 100 1 031 1 000 900 800 700 600 500 R9.00/US$ FY14 Q1 Q2 Q3 Q4 R10.12/US$ (Dec 2013 qtr) R10.50/US$ R11.00/US$ R12.00/US$ www.harmony.co.za 21
  22. 22. Wafi-Golpu www.harmony.co.za
  23. 23. Globally significant resource • Modular, expandable mine planned, with lower capital requirements, • Next phase for the Wafi-Golpu project - commencement of underground access SECTION VIEW SECTION VIEW 2009 Diatreme Surface Diatreme Surface 5250mRL Today 5250mRL 5000mRL 5000mRL 800 m 4750mRL 4500mRL 4250mRL 4000mRL 3750mRL 4750mRL 2009 GOLPU RESOURCE(1) 4500mRL 163Mt @ 0.57 g/t Au & 1.1% Cu 4250mRL 300 m 3.0 Moz Au & 1.7 Mt Cu 4000mRL 500m 19,000mE 3750mRL 20,000mE 21,000mE (1) Harmony Annual Statement of Mineral Resources and Reserves as at 30 June 2009 (2) Harmony Annual Statement of Mineral Resources and Reserves as at 30 June, 2013 Resource figures quoted on 100% basis. FY14 Q1 Q2 Q3 Q4 19,000mE +1700 m 2012 GOLPU RESOURCE(2) 1,000 Mt @ 0.63 g/t Au & 0.90% Cu 20 Moz Au & 9.0 Mt Cu 500m ~800 m 20,000mE 21,000mE 23 www.harmony.co.za 23
  24. 24. Indicative timeline Commissioning and ramp-up 1st production Increasing value Progress underground development and cave establishment January 2018 onwards Advance feasibility studies, on-mine infrastructure / early works July 2017 - July 2019 Advance underground access, underground resource definition / early works / infrastructure definition July 2014 – July 2017 (underground access construction) New pre-feasibility study – scalable, staged, lower cost mine July 2015 Feasibility for underground access May 2013 - Dec 2014 (drilling, common path infrastructure, underground access pre-feasibility study and feasibility study, progress development agreement) Pre-feasibility study – Mega Mine March 2011 - August 2012 Reducing risk FY14 Q1 Q2 Q3 Q4 www.harmony.co.za 24
  25. 25. Financial results www.harmony.co.za
  26. 26. Income statement (q-on-q) (Rand) Extracts from income statement and operating results Dec 2013 (Rm) Sep 2013 (Rm) % change 4 071 4 018 1 (3 086) (2 981) (4) Cash operating costs (2 937) (3 124) 6 Inventory movements (149) 143 >(100) 985 1 037 (5) Amortisation and depreciation (565) (577) 2 Exploration expenditure (112) (142) 21 Foreign exchange translation loss* (128) (9) >(100) (6) (38) 84 (91) 13 >(100) Revenue Production costs Operating profit as per operational results Taxation Net (loss)/profit * Included as part of the „Other (expenses)/income – net‟ line in the income statement. FY14 Q1 Q2 Q3 Q4 www.harmony.co.za 26
  27. 27. Impact of foreign exchange translation (q-on-q) (Rand) Extracts from income statement and HEPS calculation Dec 2013 (Rm) Sep 2013 (Rm) % change Net (loss)/profit (91) 13 >(100) Foreign exchange translation loss* (128) (9) >(100) 37 22 68 Headline (loss)/earnings per share (21) 5 >(100) Foreign exchange translation loss per share (30) (2) >(100) 9 7 29 Net profit excluding translation effects HEPS excluding translation effect * Included as part of the „Other (expenses)/income – net‟ line in the income statement. FY14 Q1 Q2 Q3 Q4 www.harmony.co.za 27
  28. 28. Income statement (q-on-q) (US$) Extracts from income statement and operating results Dec 2013 (US$m) Sep 2013 (US$m) % change 402 403 - (305) (299) (2) Cash operating costs (290) (314) 8 Inventory movements (15) 15 >(100) 97 104 (7) Amortisation and depreciation (56) (58) 3 Exploration expenditure (11) (14) 2 Foreign exchange translation loss* (13) (1) >(100) (1) (4) 75 (10) 1 >(100) 10.12 9.96 2 Revenue Production costs Operating profit as per operational results Taxation Net (loss)/profit Exchange rate (R/US$) * Included as part of the „Other (expenses)/income – net‟ line in the income statement. FY14 Q1 Q2 Q3 Q4 www.harmony.co.za 28
  29. 29. Impact of foreign exchange translation (q-on-q) (US$) Extracts from income statement and HEPS calculation Dec 2013 (US$m) Sep 2013 (US$m) % change Net (loss)/profit (10) 1 >(100) Foreign exchange translation loss* (13) (1) >(100) 3 2 50 Headline (loss)/earnings per share (2) 0.5 >(100) Foreign exchange translation loss per share (3) 0.2 >(100) 1 0.7 43 Net profit excluding translation effects HEPS excluding translation effect * Included as part of the „Other (expenses)/income – net‟ line in the income statement. FY14 Q1 Q2 Q3 Q4 www.harmony.co.za 29
  30. 30. Cash flow summary (q-on-q) (Rand) Extracts from the cash flow statement Dec 2013 (Rm) Cash flow from operations before exploration Sep 2013 (Rm) 812 380 (112) (142) (28) - Capital expenditure (624) (618) At 31 December 2013: Net debt (957) (871) 2 323 2 288 (3 280) (3 159) Exploration expenditure Income and mining taxes paid Cash balance Debt* * The debt balance includes a foreign exchange translation loss of R111 million on the US$ denominated loan for the December 2013 quarter. FY14 Q1 Q2 Q3 Q4 www.harmony.co.za 30
  31. 31. Cash flow summary (q-on-q) (US$) Extracts from the cash flow statement Cash flow from operations before exploration Dec 2013 (US$m) Sep 2013 (US$m) 80 38 (11) (14) (3) - Capital expenditure (62) (62) At 31 December 2013: Net debt (91) (86) 222 228 (313) (314) Exploration expenditure Income and mining taxes paid Cash balance Debt FY14 Q1 Q2 Q3 Q4 www.harmony.co.za 31
  32. 32. Borrowings renegotiated • New three year Nedbank debt facility of R1.3bn − replaces previous R850m facility − matures in December 2016 − outstanding R458m was settled by drawing down on new facility • Covenants renegotiated for US$ and Rand facilities − the group‟s interest cover shall not be less than five (EBITDA/Total interest) − current ratio shall not be less than one (current assets/current liabilities) − cash flow from operating activities shall be above R100m for the six months prior to the evaluation date − total net debt shall not exceed R3bn plus the rand equivalent of US$300m − tangible net worth¹ to net debt ratio shall not be less than six times ¹Tangible Net Worth is defined as total equity less intangible assets. FY14 Q1 Q2 Q3 Q4 www.harmony.co.za 32
  33. 33. Conclusion www.harmony.co.za
  34. 34. Harmony‟s foundations are in place What we say Growth in margin Unprofitable areas closed Optimise operational delivery AISC: All-in sustaining cost FY14 Going forward What we have done Q1 Q2 Q3 Q4 Lowest R/tonne underground gold miner in SA Replaced underperforming management teams Capital and costs reduced Restructured labour force All mines operating below R400 000/kg AISC¹ Ore reserve flexibility Improve infrastructure and optimise high development return areas www.harmony.co.za 34
  35. 35. Upside in share price Market capitalisation/Reserve oz  Increasing grade  Lowest R/tonne SA gold producer 200 Greater capital discipline 160   Free cash flow  No hedging  Balance sheet strength – low debt  Geared to SA currency US$/oz 187 180 140 120 100 80 65 60 40 24 20 0 2013 estimate  Earnings growth  Golpu – one of the top gold/copper Global peer group resources in the world Source: HSBC Bank plc FY14 Q1 Q2 Q3 Q4 SA peer group Harmony www.harmony.co.za 35
  36. 36. In short… “Harmony has been in operation in South Africa for the past 63 years. We have positioned the company to remain sustainable for many years to come. We manage costs and production to ensure profitability at all gold prices. We mine profitably. That is what our approach to management is all about.” CEO, Graham Briggs FY14 Q1 Q2 Q3 Q4 www.harmony.co.za 36
  37. 37. Contact us: HarmonyIR@harmony.co.za Henrika Ninham Investor Relations Manager Tel: +27 (0)11 411 2314 Mobile: +27 (0)82 759 1775 Email: henrika@harmony.co.za Marian van der Walt Executive: Corporate and Investor Relations Tel: +27 (0)11 411 2037 Mobile: +27 (0)82 888 1242 Email: marian@harmony.co.za JSE (HAR) NYSE (HMY) FY14 Q1 Q2 Q3 Q4 An exciting investment proposition 37 www.harmony.co.za
  38. 38. Appendix An exciting investment proposition 38 FY14 Q1 Q2 Q3 Q4 www.harmony.co.za
  39. 39. Benchmarking our grade Adjusted Mineral Recovered (-5%) to Actual grade Actual grade grade reserve compare with (g/t) achieved (g/t) achieved grade (g/t) forecast for recovery in FY12 in FY13 June 2013 FY14 grade Mine Sep 13 qtr Recovered grade (g/t) Dec 13 qtr Recovered grade (g/t) Kusasalethu 5.97 5.67 4.71 3.85 5.15 3.87 3.77 Doornkop 4.99 4.74 3.31 3.60 4.33 3.24 3.66 Phakisa 7.04 6.69 4.88 4.75 4.59 4.84 5.15 Tshepong 5.39 5.12 4.29 3.99 4.27 4.21 4.39 Masimong 4.76 4.52 3.45 4.17 4.32 4.01 4.25 Target 1 5.23 4.97 4.61 5.53 5.13 5.66 6.43 11.08 10.53 6.97 9.87 9.58 12.21 12.79 Joel 5.45 5.18 4.78 5.28 4.61 4.38 4.52 Unisel 4.30 4.09 4.04 4.07 3.90 4.41 4.79 Target 3 5.89 5.60 3.55 5.03 5.01 4.78 4.67 Total underground 5.87 5.58 4.26 4.54 4.79 4.55 4.85 Bambanani / Steyn 2 FY14 Q1 Q2 Q3 Q4 www.harmony.co.za 39
  40. 40. Driving costs down (R/kg) (year to date) Six months ended Dec 2013: Cash operating costs (including royalties)² Guidance for FY14: Annual average Capital and cash operating costs*¹ Six months ended Dec 2013: Capital and cash operating costs*² (R/kg) Operation Guidance for FY14: Average Cash operating costs (including royalties)¹ (R/kg) (R/kg) (R/kg) Kusasalethu R265 000- 295 000/kg 383 793 R340 000- 380 000/kg 493 136 Doornkop R245 000- 270 000/kg 344 704 R295 000- 330 000/kg 429 522 Phakisa R350 000- 385 000/kg 366 951 R455 000- 505 000/kg 498 808 Tshepong R280 000- 310 000/kg 344 659 R335 000- 370 000/kg 419 199 Masimong R255 000- 285 000/kg 346 207 R295 000- 325 000/kg 407 411 Hidden Valley R355 000- 395 000/kg 348 803 R425 000- 470 000/kg 392 475 Target 1 R225 000- 250 000/kg 218 949 R290 000- 320 000/kg 273 782 Bambanani R195 000- 215 000/kg 209 492 R245 000- 270 000/kg 256 877 Joel R235 000- 260 000/kg 260 016 R285 000- 315 000/kg 319 531 Unisel R295 000- 325 000/kg 307 183 R335 000- 370 000/kg 351 172 Target 3 R270 000- 300 000/kg 378 220 R345 000- 380 000/kg 477 536 Various surface R275 000- 305 000/kg 316 260 R275 000- 305 000/kg 319 911 Kalgold R330 000- 365 000/kg 321 992 R380 000- 420 000/kg 356 147 Steyn 2 R260 000- 290 000/kg 227 898 R265 000- 290 000/kg 232 003 ~ R270 000- R300 000/kg 316 517 ~ R325 000- R360 000/kg 385 252 Total Costs slightly more than guidance Costs below or within guidance Costs are higher than guidance ¹ An exchange rate of R9.45/US$ was used ² The average exchange rate for the six months ended Dec 2013 was R10.04/US$ * Includes cash operating costs (including royalties), maintenance capital, growth capital and local economic development costs FY14 Q1 Q2 Q3 Q4 www.harmony.co.za 40
  41. 41. Driving costs down (US$/oz) (year to date) Operation Guidance for FY14: Average Cash operating costs (including royalties)¹ (US$/oz) Six months ended Dec 2013: Cash operating costs (including royalties)² (US$/oz) Guidance for FY14: Annual average Capital and cash operating costs*¹ (US$/oz) Six months ended Dec 2013: Capital and cash operating costs*² (US$/oz) Kusasalethu US$880 – 980/oz 1 189 US$1120- 1240/oz 1 528 Doornkop US$800 – 890/oz 1 068 US$980- 1080/oz 1 331 US$1 150 – 1 270/oz 1 137 US$1500- 1660/oz 1 545 Tshepong US920 – 1 020/oz 1 068 US$1110- 1220/oz 1 299 Masimong US$845 – 930/oz 1 073 US$970- 1070/oz 1 262 US$1 100 – 1 210/oz 1 081 US$1400- 1550/oz 1 216 Phakisa Hidden Valley Target 1 US$740 – 820/oz 678 US$960- 1060/oz 848 Bambanani US$645 – 710/oz 649 US$810- 900/oz 796 Joel US$780 – 865/oz 806 US$940- 1040/oz 990 US$980 – 1 080/oz 952 US$1100- 1220/oz 1 088 1 172 US$1130- 1250/oz 1 480 US$905 – 1 000/oz 980 US$910- 1010/oz 991 Kalgold US$1 080 – 1 195/oz 998 US$1260- 1390/oz 1 103 Steyn 2 US$870 – 955/oz 706 US$870- 960/oz ~ US$880 – 980/oz 980 ~ US$1070 -1180/oz Unisel US$890 – 980/oz Target 3 Various surface Total Costs slightly more than guidance Costs below or within guidance Costs are higher than guidance ¹ An exchange rate of R9.45/US$ was used ² The average exchange rate for the six months ended Dec 2013 was R10.04/US$ * Includes cash operating costs (including royalties), maintenance capital, growth capital and local economic development costs FY14 Q1 Q2 Q3 Q4 719 1 194 www.harmony.co.za 41
  42. 42. All-in sustaining costs 2% lower q-on-q (R/kg) R/kg 600 000 All-in sustaining costs - December 2013 quarter 550 000 Target 3 500 000 Kusasalethu Phakisa Masimong 450 000 Doornkop Gold price received 400 000 Dumps Unisel Total Jun 13 qtr Tshepong 14% Total Sep 2013 qtr 2% Kalgold Hidden Valley Total Dec 2013 qtr 350 000 300 000 Steyn 2 250 000 Target 1 Joel Phoenix Bambanani 200 000 0% 10% 20% December 2013 qtr actual FY14 Q1 Q2 Q3 Q4 30% 40% 50% 60% Cumulative % of Production September 2013 qtr actual 70% 80% 90% 100% Average gold price received www.harmony.co.za 42
  43. 43. All-in sustaining costs 4% lower q-on-q (US$/oz) All-in sustaining costs - December 2013 quarter (US$/oz) US$/oz 1 700 Kusasalethu Target 3 1 600 Total Jun 2013 qtr Phakisa 1 500 Masimong 1 400 19% Tshepong Gold price received 1 300 Total Dumps 1 200 Hidden Valley Sep 2013 qtr Doornkop 3% Total Dec 2013 qtr Kalgold Unisel 1 100 1 000 900 Joel Target 1 Phoenix Steyn 2 800 Bambanani 700 0% 10% 20% 30% December 2013 qtr actual FY14 Q1 Q2 Q3 Q4 40% 50% 60% Cumulative % of Production September 2013 qtr actual 70% 80% 90% 100% Average gold price received www.harmony.co.za 43

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