Harmony Gold Mining Co. Ltd. · JSE:HAR
Harmony Gold Mining — Denver Gold Forum 2014
26 slides from Harmony Gold Mining's conference presentation, Sep 15, 2014
Slide 1: Denver Gold Forum 15 September 2014
Ticker codes: JSE (HAR) NYSE (HMY Denver Gold Forum 15 September 2014 1 w w w . h a r mw onwyw. c. hoa. zr m a ony.co.za DENVER GOLD FORUM 2014
Slide 2: Private Securities Litigation Reform Act Safe Harbour Statement
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
Slide 3: Agenda
Agenda 1 Who we are 2 Our strategic value drivers 3 Conclusion 3 www.harmony.co.za DENVER GOLD FORUM 2014
Slide 4: Who we are
Who we are Gold production FY14 • Operating in South Africa and Papua New Guinea (PNG) South • Building world class mines in South Africa and PNG Africa 91% – produced 1.17Moz* of gold in FY14 • Own 50% of the magnificent Golpu resource in PNG PNG 9% • Reserves of 49.5Moz* and resources of 133.8Moz*
Slide 5: Our strategic value drivers
ivers value dri Our
Slide 6: 4 strategic value drivers
4 strategic value drivers 1 We are efficient miners 2 We fund our own capital to ensure future growth and profitability We are experienced explorers, mine developers and operators 3 in emerging economies 4 Golpu will develop into a world class copper gold mine – a potential game changer for Harmony
Slide 7: Efficient miners
Efficient miners pS (CQ oy OF 1A j e : e)
Slide 8: Efficiently mining lower grade assets
Efficiently mining lower grade assets SA underground cash operating costs SA underground recovered grade R/t g/t 1 900 9.0 7.8 1 784 8.0 1 800 7.0 1 700 6.0 1 623 6.0 1 600 4.7 5.0 1 502 1 500 4.0 1 400 3.0 1 300 2.0 Harmony Sibanye Anglogold Harmony Sibanye Anglogold Source: CIBC World Markets plc;
Slide 9: Grade improvements – year on year
Grade improvements – year on year g/t Underground recovered grade (g/t) 4.9 4.8 4.77 4.7 4.6 4.54 4.5 4.4 4.3 4.26 4.2 4.1 4.0 FY12 FY13 FY14 9 www.harmony.co.za DENVER GOLD FORUM 2014
Slide 10: Year on year reduction of all-in sustaining costs
Year on year reduction of all-in sustaining costs US$/oz All-in sustaining cost (US$/oz) 1 600 1 522 1 500 18% 1 400 1 300 1 242 1 200 1 100 1 000 900 800 FY13 FY14 10 www.harmony.co.za DENVER GOLD FORUM 2014
Slide 11: Hidden Valley’s best quarter ever
Hidden Valley’s best quarter ever Ounces produced Cash operating costs US$/oz All-in sustaining costs US$/oz 35 000 1 800 3 500 30 000 1 600 3 000 1 400 2 500 25 000 1 200 2 000 20 000 1 000 1 500 15 000 800 1 000 10 000 600 500 Jun 12 Jun 13 Jun 14 Dec 12 Dec 13 Sep 12 Sep 13 Mar 13 Mar 14 Jun 13 J
Slide 12: Working towards profitability and free cash flow (y-on-y)
Working towards profitability and free cash flow (y-on-y) • 3% increase in gold production to 1.17moz • 18% reduction in all-in sustaining costs at US$1242/oz • 5% improvement in underground recovered grade at 4.77g/t • Responsible capital expenditure – Phakisa shaft decline not pursued – 30% reduct
Slide 13: We fund our own capital
‘ we own | Capita’ ph gs bay qi)
Slide 14: Capital expenditure that ensures returns (US$m)
Capital expenditure that ensures returns (US$m) Capital expenditure that supports safe production and a sustainable future US$m 450 415 400 62 41% 350 57 300 280 245 19 250 1 12 153 200 145 140 150 100 84 88 50 67 59 25 28 - FY13 FY14 FY15 Growth capital - SA Maintenance capital - SA Ongoing capital
Slide 15: Low net debt (y-on-y) – US$
Low net debt (y-on-y) – US$ Jun 2014 Jun 2013 Extracts from the cash flow statement (US$m) (US$m) Cash flow from operations before exploration¹ 245 435 Exploration expenditure (40) (76) Tax refunded/(paid) - (33) Proceeds from sale of Evander - 139 Capital expenditure (244) (429) Dividend - (50) At
Slide 16: Successfully mining and exploring in emerging economies
Successfully mining j and exploring in emerging economies
Slide 17: Our asset portfolio
Our asset portfolio Production gap and build-up Commissioning Steady state production Project construction Target 1, Unisel, Kalgold, Hidden Increasing project value Valley, Joel, Masimong, Tshepong, Bambanani, Phoenix Doornkop, Phakisa, Feasibility Pre-feasibility study Kusasalethu Resource definit
Slide 18: Major player in SA and PNG
Major player in SA and PNG • Significant exploration land holding in Papua New Guinea, one of the most prospective geological areas of the world • Industry leading cost per exploration discovery ounce less than US$9/oz • We embrace our social licences to mine and go beyond compliance • Creating valu
Slide 19: Truly empowered company
Truly empowered company Harmony’s Mining Charter performance Planned Achieved/ or not Criteria requirements in FY14 for FY15 yet achieved Ownership 26% 28% to 38% 38%* Employment equity of HDSA’s Overall 40% 46% 46% Executive 40% 50% 50% Senior management 40% 49% 49% Middle management 40% 41
Slide 20: Golpu: a significant asset
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Slide 21: De-risking the development of Golpu
De-risking the development of Golpu Our considerations New targeted outcomes • Investors seeking return on investment • Modular expandable solution • Project with lower capital and near term • Lower total capital cost cash flow • Potential to mine using sub-level caving to • Scalable start-up mine e
Slide 22: Drill results showing higher grade areas
Drill results showing higher grade areas • WR504 (west to east) 1 369m @ 1.1g/t Au and 1.7% Cu from 399m, including 428m @ 2.2g/t Au and 2.9% Cu from 1 191m – confirmed fault structure controlling higher grade blocks • WR499 (north to south) 1 247m @ 1.0g/t Au and 1.2% Cu from 966m, including 560m @
Slide 23: Conclusion
Slide 24: Our strategy: a competitive, value focused gold mining company
Our 5 year strategy A COMPETITIVE, VALUE FOCUSED GOLD MINING COMPANY • Safely delivering on plans • Increase free cash flow through 1. Improving our margins higher grades and cost control • Retain flexible balance sheet 2. Growing value per share of PNG assets • Complete Golpu studies • Build a mine
Slide 25: Positioned to deliver
Positioned to deliver • Safety comes before production − external audit done on safety − improvement plan in place − leading practices clearly defined at all operations • Diversified risk portfolio with exposure to SA, PNG, gold and copper • Only safe, profitable quality ounces will be mined − revis
Slide 26: www.harmony.co.za
www.harmony.co.za Email us: HarmonyIR@harmony.co.za HENRIKA NINHAM MARIAN VAN DER WALT INVESTOR RELATIONS MANAGER EXECUTIVE: CORPORATE AND INVESTOR RELATIONS Tel: +27 (0)11 411 2314 Tel: +27 (0)11 411 2037 Mobile: +27 (0)82 759 1775 Mobile: +27 (0)82 888 1242 JSE (HAR) NYSE (HMY) 26 www.harmony.co.z