Harmony Gold Mining Co. Ltd. · JSE:HAR
Harmony Gold Mining — Investor Presentation (2002)
17 slides from Harmony Gold Mining's investor presentation, 2002
Slide 1: ARMgold/Harmony Free Gold Joint Venture Company
ARMgold/Harmony Free Gold Joint Venture Company
Slide 2: March '02 Quarter in Review
MARCH ‘02 QUARTER IN REVIEW VERY DIFFERENT JOINT VENTURE COMPANY SIMILAR BUSINESS APPROACH TO MINING VALUE CREATING INVESTMENT
Slide 3: Highlights - March 2002
HIGHLIGHTS - MARCH 2002 • cash operating profits of R402,8 million • quarterly production of 7 942 kgs or 255 350 ozs • successful transition of operational control to JV • remaining conditions precedent fulfilled by 10 April 2002 • lower working cost structure allows for re-opening of West, Sable a
Slide 4: March '02 Quarter in Review: JV operational control and acquisition cost
MARCH ‘02 QUARTER IN REVIEW • Free Gold JV took operational control on 3 January 2002 • conditions precedent have all been met and JV company formed. • final estimated acquisition cost of R2,2 billion excluding tax:- - R1 800 million cash on conditions precedent being met - R 400 million by January
Slide 5: March '02 Quarter in Review: overhead restructuring and retrenchments
MARCH ‘02 QUARTER IN REVIEW • initial phase of addressing overhead structure, associated costs and labour structures well underway throughout the company • 1 763 voluntary retrenchments to date • 399 management and supervisory positions • 1 364 other employees • 2 345 additional positions affected m
Slide 6: March '02 Quarter in Review: operating results
MARCH ‘02 QUARTER IN REVIEW • excellent overall operating results returned for the first quarter under JV management despite shorter quarter with 58 production days versus 69 days in December ‘01 quarter • opened West, Sable and Kudu Shafts during the quarter. Net R6,8 million costs capitalised to r
Slide 7: March '02 Quarter in Review: Bambanani grade
MARCH ‘02 QUARTER IN REVIEW • grade from Bambanani at 8,3 g/t higher than planned mining grade of 7,6 g/t due to harvest mode approach applied at acquired operations • typical nature of operations on acquisition. Focus to return on mining to average grade of orebody for which development plans have
Slide 8: March '02 Quarter in Review: Joel mudrush and restructuring
MARCH ‘02 QUARTER IN REVIEW • mudrush on 104 level at South Shaft, Joel resulted in a fatal accident and affected production for 14 days • Joel restructuring almost completed • optimum operating levels of 41 000 tonnes per month at 4,0 g/t by 30 June 2002 • due to clean-up and closure phase at Joel
Slide 9: Cash Operating Profit
CASH OPERATING PROFIT (R’million) MAR ‘02 DEC ‘01 VAR (%) Cash Operating 402,8 261,5 54,0 Profit Net interest 35,4 Amortisation charges 26,8 Profit before tax 340,6 Due to ARM 170,3 Due to Harmony 170,3
Slide 10: Underground Operations
UNDERGROUND OPERATIONS MAR ‘02 DEC ‘01 VAR (%) Gold price R/Kg 107 657 88 530 21,6 Cash cost R/Kg 57 882 61 784 (6,3) Profit margin R/Kg 49 775 26 746 86,1
Slide 11: Operational Profit Margin
OPERATIONAL PROFIT MARGIN TOTAL MINE RESULTS MAR ‘02 DEC ‘01 VAR (%) Gold price US$/oz 290 261 11,1 Cash cost US$/oz 154 188 18,1 Profit margin US$/oz 136 73 86,3 Exchange rate Rand per US$ 1-00 11,53 10,30 (11,9)
Slide 12: Impact of Shorter Calendar
IMPACT OF SHORTER CALENDAR TONNES MILLED (000’S) JAN FEB MAR Underground 291 307 328 Surface 319 426 416 TOTAL 610 733 744 KGS RECOVERED Underground 2 213 2 598 2 316 Surface 274 295 246 TOTAL 2 487 2 893 2 562
Slide 13: Operating Results
OPERATING RESULTS M AR ‘02 DEC ‘01 VAR (%) UNDERGROUND Tonnes milled 926 1 139 (18,7) Grade g/t 7,70 7,41 3,9 Gold recovered Kg 7 127 8 442 (15,6) SURFACE Tonnes milled 1 161 914 27,0 Grade g/t 0,70 0,64 9,4 Gold recovered Kg 815 582 40,0
Slide 14: Operating Results - Total
OPERATING RESULTS - TOTAL MAR ‘02 DEC ‘01 VAR (%) Tonnes milled 2 087 2 053 1,7 Grade g/t 3,81 4,40 (13,4) Gold recovered Kg 7 942 9 024 (12,0)
Slide 15: Cash Operating Profit
CASH OPERATING PROFIT MAR ‘02 DEC ‘01 VAR (%) (R’ millions) Bambanani 158,4 61,0 159,7 Tshepong 158,6 110,9 43,0 Matjhabeng 32,5 42,4 (23,3) Joel 5,2 22,2 (76,6) Surface 48,1 25,0 92,4 TOTAL 402,8 261,5 54,0
Slide 16: JV Steering Committee Structure
JV STEERING COMMITTEE STRUCTURE Interim Structure Future Structure Peter Steenkamp - Mining/H & S } Lewies Fourie - Business Services } ARM Robbie Holmwood - Engineering } Peter Steenkamp (Operations Leader) Pine Pienaar - Commercial Services } Bob Atkinson - Mining/H & S } Harmony Graham Briggs - O
Slide 17: What next?
MARCH ‘02 QUARTER IN REVIEW What next? • improved tonnages and slightly lower grades expected in June 2002 quarter • more development programmes are required to ensure flexibility of mining operations • evaluation of current capital projects and expenditure profiles underway • continued focus on rea