NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (RAND)
1. ACCOUNTING POLICIES
Basis of accounting
The condensed consolidated financial statements for the interim reporting period ended 31 December 2020 has been prepared in accordance with International Accounting Standard IAS 34 Interim Financial Reporting, the recognition and measurement requirements of International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board, the SAICA Financial Reporting Guides as issued by the Accounting practices Committee, Financial Reporting Pronouncements as issued by the Financial Reporting Standards Council, JSE Listings Requirements and in the manner required by the Companies Act no. 71 of 2008 of South Africa. The interim report does not include all the notes of the type normally included in an annual financial report. Accordingly, this report is to be read in conjunction with the annual report for the year ended 30 June 2020 and any public announcements made by Harmony during the interim reporting period. The accounting policies adopted are consistent with those of the previous financial year and corresponding interim reporting period. There were no new standards, amendments to standards or interpretations that became effective that had a material impact on the group's results or financial position.
Foreign exchange translation gain/(loss) has been presented separately in the income statement. The amounts were previously included as part of other operating income/(expenses). Other operating income/(expenses) has been represented in all periods presented.
The condensed consolidated financial statements have been prepared on a going concern basis.
2. RESTATEMENT OF DECEMBER 2019 FINANCIAL RESULTS
Subsequent to the release of the financial results for the six months ended 31 December 2019 management identified a classification error on the 'Foreign exchange translation gain/(loss)', the 'Unrealised gain/(loss) on gold contracts' and the 'Gain on asset measured at fair value through other comprehensive income' line items in the statement of other comprehensive income. The impact of the correction of the error on the December 2019 statement of comprehensive income is disclosed below:
Statement of comprehensive income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the six months ended 31 December 2019
|
|
Figures in million
|
Previously
reported
|
Correction
|
Restated
|
|
Other comprehensive income for the period, net of income tax
|
(244)
|
|
—
|
|
(244)
|
|
|
Items that may be reclassified subsequently to profit or loss:
|
(244)
|
|
(19)
|
|
(263)
|
|
|
Foreign exchange translation gain/(loss)
|
(402)
|
|
317
|
|
(85)
|
|
|
Gain on assets measured at fair value through other comprehensive income
|
19
|
|
(19)
|
|
—
|
|
|
Remeasurement of gold hedging contracts
|
|
|
|
|
Unrealised gain/(loss) on gold contracts
|
(227)
|
|
(317)
|
|
(544)
|
|
|
Released to revenue
|
317
|
|
—
|
|
317
|
|
|
Deferred taxation thereon
|
49
|
|
—
|
|
49
|
|
|
|
|
|
|
|
Items that will not be reclassified to profit or loss:
|
—
|
|
19
|
|
19
|
|
|
Gain on assets measured at fair value through other comprehensive income
|
—
|
|
19
|
|
19
|
|
|
|
|
|
|
The error, and subsequent correction, net each other off within other comprehensive income and are limited to the line items mentioned. The net profit, other comprehensive income and total comprehensive income line items for the period were not impacted, nor were any earnings amounts, the cash flow statement or any other statement or other disclosure within the financial statements.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (RAND)
3. COVID-19 IMPACT
South Africa
The national lockdown that began on 27 March 2020 to curb the spread of the Coronavirus (COVID-19) and allow the country time in which to prepare for the demands the pandemic would have on its health care system is still in place. Harmony continues with the risk assessment-based COVID-19 prevention strategy which was rolled out across all of its operations before the lockdown was announced. This approach has allowed management to identify, evaluate and rank the hazards associated with any exposures to COVID-19 and potential infections. It has allowed the company to reduce or eliminate the probability of an employee contracting COVID-19 and to limit the severity should an employee be infected.
Harmony’s COVID-19 Standard Operating Procedure (SOP) has been adopted and rolled out, ensuring a safe return to work and work environment for each of its employees. The SOP was informed by guidelines provided by the Department of Mineral Resources and Energy, the National Council for Infectious Diseases and the World Health Organisation.
All requisite staffing, facilities and equipment are in place to ensure continuous rigorous screening of employees at work, as well as isolate or quarantine employees infected by or exposed to COVID-19, with subsequent testing and treatment. Management adapt the approach continuously as more information becomes available and new best practices evolve.
Papua New Guinea
Harmony’s Hidden Valley mine in Papua New Guinea has continued to operate during the COVID-19 State of Emergency declared in that country, however restrictions on international travel and the implementation of strict COVID-19 control protocols, required longer employee rosters, which includes rostered days off on site to manage fatigue, which has negatively impacted productivity. Work is being done to mitigate this impact. The delivery of essential supplies to the mine has continued, with strict isolation control measures in place. All non-essential staff have been removed from site and certain activities and expenditures have been curtailed to focus on safe, profitable operations during the pandemic. Protocols were adopted to allow the safe movement of personnel to and from site during this period.
Vaccines
During November and December 2020, several pharmaceutical companies announced the successful development of vaccines against the SARS-COV-2 virus. At the time, this was considered a crucial tipping point in protecting people and preventing infections in future. However, the subsequent discovery of several mutations, or variants, worldwide is very concerning, given how quickly these occurred and whether the vaccines would still be effective against these variants.
Governments around the world are rolling out vaccine programmes, including South Africa. The initial draft of the roll-out approach includes essential workers in the second tier. South African miners have been classified as essential workers and would therefore be eligible for vaccination, along with other people in this category, following the vaccination of healthcare workers. Harmony is working together with its peers in the mining industry to consider options for the roll-out and if there are opportunities to extend this to the communities that they operate in.
Due to the high level of uncertainty and lack of official information, management is unable to reliably estimate when the roll-out would occur. Possible estimations of timelines for a government-led roll-out would be for the second tier to be vaccinated by December 2021, at best, with a possible worst-case by June 2022. This is without considering any potential negation of the effectiveness by the current and future variants.
Financial risk management
The effects of COVID-19 and other macro developments have increased financial risks such as exchange rate, interest rate and commodity price volatility, while also impacting on liquidity and credit risk. Management has put various measures in place to mitigate and/or manage the risks and continues monitoring the situation closely. Refer to note 14 for additional detail.
Market impact
Exchange rates
Due to the impact of the COVID-19 pandemic, the Rand has weakened significantly from the beginning of the 2020 calendar year. The Rand has since recovered from its weakest level at the beginning of April 2020 of R19.05/US$ to close at R14.69 on 31 December 2020. The Rand strengthened against the Australian dollar from R11.96/A$1 at 30 June 2020 to R11.31/A$1 at 31 December 2020. In addition, the Papua New Guinea Kina weakened against the Australian dollar from PGK2.38/A$1 at 30 June 2020 to PGK2.74/A$1 at 31 December 2020. These movements in the currencies expose the group's operations to foreign currency gains and losses on foreign-denominated receivables and liabilities, including derivatives, and also impact the group’s translation of its international operating results and net assets into its Rand presentation currency, which resulted in a foreign exchange translation loss of R1.1 billion in other comprehensive income. In addition, a net foreign exchange translation gain of R652 million was recognised in profit or loss for the six months ended 31 December 2020, primarily on the US$ borrowings. With the announcements made during November and December 2020 on the successful development of vaccines against the SARS-COV-2 virus, a marked strengthening of the Rand against the US$ has occurred. The R/US$ exchange rate at 30 June 2020 and 31 October 2020 was R17.32 and R16.24, respectively and subsequently the average R/US$ exchange rates for November and December 2020 were R15.51 and R14.85, respectively.
Commodity prices
Gold prices have rallied to an all-time high following the global economic fallout of COVID-19 and ongoing geopolitical uncertainty supporting its safe haven status with investors. The US dollar gold price received increased by 19% from $1 447 per ounce in December 2019 to $1 716 per ounce for the December 2020 period. The Rand gold price received increased by 31% from R683 158 per kilogram in December 2019 to R896 587 per kilogram for the December 2020 period. Following the announcements on the successful development of vaccines against the SARS-COV-2 virus in November and December 2020, spot gold prices experienced a pull-back, falling at one stage to $1 777 per ounce towards the end of November 2020. This drop in spot gold prices was subsequently reversed during December 2020 with prices rising as high as $1 894 per ounce as a result of the second wave of COVID-19 infections being experienced across the world.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (RAND)
3. COVID-19 IMPACT continued
Market impact continued
Interest rates
The United States of America (US) as well as South African market interest rates remain stable at the recent low levels and are expected to remain low for some time to come, as economies all over the world are still impacted by the economic impact of the COVID-19 pandemic.
Since the US Federal Reserve dropped the Fed Funds rate to a maximum of 0.25% in March 2020, there have been no changes to the rate. Similarly in South Africa, the South African Reserve Bank (SARB) has kept the repo rate at a low of 3.50% since reducing it to that level on 23 July 2020. In the first half of 2020 the SARB lowered the repo rate by 2.75% from 6.50% to 3.75%. The expectation is for interest rates to remain low as inflation is well within the target band.
Impact on production
During the initial phase of the South African national lockdown, the underground operations were placed on care and maintenance and employees returned to their homes across the country and in other SADC countries. On 1 May 2020, the underground operations were granted concessions to start producing at a maximum capacity of 50% and as of 1 June 2020, operational restrictions were lifted further to allow the mining industry to operate at 100% of its labour capacity. By 1 September 2020, Harmony had completed the recall of all operational employees.
Management continuously monitors the crew availability and adapts the production models accordingly. The December break was shortened to allow for a catch-up on development which had been delayed during Level 4 & 5 of the national lockdown. It also allowed for extra production days.
Due to the protocols put in place to deal with an employee who has potentially been exposed to the virus, the disruption to production has been minimal. The reduction of the quarantine time from 14 to 10 days has also seen a quicker return after a potential exposure. The use of the rapid antigen test during the January 2021 return-to-work process significantly improved the process as employees could be cleared for work within an hour of testing. Those with a positive test were immediately isolated for further case management.
Critical estimates and judgements
There have been no significant changes to the critical estimates and judgements for the impact of COVID-19 as at 30 June 2020. With the fair value exercise that is required for the acquisition of AngloGold Ashanti's remaining South African assets, management made certain assumptions and estimates required in the process as at 1 October 2020. These assumptions were affected by the market volatility at the time. Refer to note 13 for further detail.
4. REVENUE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
|
Year ended
|
|
Figures in million
|
|
31 December
2020
(Reviewed)
|
31 December
2019
(Reviewed)
|
30 June
2020
(Audited)
|
|
Revenue from contracts with customers
|
|
23 240
|
|
15 794
|
|
30 642
|
|
|
Gold1
|
|
22 670
|
|
15 326
|
|
29 704
|
|
|
Silver2
|
|
510
|
|
409
|
|
839
|
|
|
Uranium2
|
|
60
|
|
59
|
|
99
|
|
|
Consideration from streaming contract3
|
|
119
|
|
—
|
|
—
|
|
|
Hedging loss4
|
|
(1 771)
|
|
(317)
|
|
(1 397)
|
|
|
Total revenue5
|
|
21 588
|
|
15 477
|
|
29 245
|
|
1 The increase is mainly due to the acquisition of the Mponeng operations and related assets and a higher gold price. The acquired operations contributed R2.8 billion in revenue during the period. In addition, the average gold price received increased by 31% to R896 587/kg from R683 158/kg in the December 2019 six months.
2 Silver is derived from the Hidden Valley mine in Papua New Guinea. Uranium is derived from the Moab Khotsong operation.
3 Relates to the recognition of non-cash consideration recognised as part of revenue for the streaming arrangement. Refer to note 12 for further information.
4 Relates to the realised effective portion of the hedge-accounted gold derivatives. Refer to note 10 for further information.
5 A geographical analysis of revenue is provided in the segment report.
The points of transfer of control are as follows:
|
|
|
|
|
|
|
|
•Gold: South Africa (excluding streaming contract)
|
Gold is delivered and certificate of sale is issued.
|
|
•Gold and silver: Hidden Valley
|
Metal is collected from Hidden Valley and a confirmation of collection is sent to and accepted by the customer.
|
|
•Uranium
|
Confirmation of transfer is issued.
|
|
•Streaming contract
|
Gold is delivered and credited into the Franco-Nevada designated gold account.
|
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (RAND)
5. COST OF SALES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
|
Year ended
|
|
Figures in million
|
31 December
2020
(Reviewed)
|
31 December
2019
(Reviewed)
|
30 June
2020
(Audited)
|
|
Production costs – excluding royalty1
|
14 399
|
|
11 233
|
|
21 721
|
|
|
Royalty expense2
|
409
|
|
133
|
|
327
|
|
|
Amortisation and depreciation3
|
1 816
|
|
1 926
|
|
3 508
|
|
|
Rehabilitation expenditure
|
3
|
|
47
|
|
47
|
|
|
Care and maintenance cost of restructured shafts
|
72
|
|
73
|
|
146
|
|
|
Employment termination and restructuring costs4
|
151
|
|
26
|
|
40
|
|
|
Share-based payments
|
64
|
|
64
|
|
130
|
|
|
Other
|
8
|
|
(4)
|
|
(11)
|
|
|
Total cost of sales
|
16 922
|
|
13 498
|
|
25 908
|
|
1 Production costs increased during the December 2020 period mainly due to the Mponeng operations and related assets acquisition which amounted to R2.0 billion. The remaining increase is mainly attributable to annual and inflationary increases related to labour costs, consumables and services.
2 The royalty expense increased during the December 2020 period due to increased profitability as a result of the higher gold price.
3 The completion of Stage 5 at Hidden Valley during the December 2019 quarter is the primary contributor for the period on period decrease.
4 The increase is due to a new programme for voluntary and medical severance packages offered to employees.
6. CORPORATE, ADMINISTRATION AND OTHER EXPENDITURE
The amount for the six months ended 31 December 2020 increased from 31 December 2019 mainly due to higher management incentive payments and R96 million for the integration cost related to the acquisition of the Mponeng operations and related assets.
7. TAXATION
(a) Current taxation
The increase in gains on foreign exchange derivative contracts and foreign exchange gains as well as the increase in revenue increased taxable profits and consequently the current tax expense during the December 2020 period.
(b) Deferred taxation
Deferred tax expense
The R350 million increase in the deferred tax expense during the December 2020 period is attributable to increased net taxable temporary differences due primarily to the utilisation of the assessed losses and unredeemed capital expenditure in certain companies as a result of higher taxable profits.
Deferred tax balance
The increase in the deferred tax liability is due in part to the deferred tax balances for the Mponeng operations and related assets, with the exception of Chemwes (see below). This increase amounted to R251 million at acquisition date. The deferred tax rates for Golden Core Trade and Invest (Pty) Ltd (Mponeng) and Chemwes (Pty) Ltd (Chemwes) are 10.1% and 18.0% respectively. The inclusion of the Vaal River Closure business into Moab increased its rate from 17.3% to 20.8% which also contributed to the increase in the liability balance. The increase in taxable temporary differences, as discussed above in the deferred tax expense, and changes in the net derivative asset/(liability) position from 30 June 2020 had an impact on the majority of the companies within the group.
As at 30 June 2020 a deferred tax asset was recognised in Harmony Company and Randfontein Estates. Subsequently, the net deferred tax asset balance has decreased due to the utilisation of assessed losses, unredeemed capital expenditures and a decrease in the net derivative liability. Harmony Company's deferred tax asset balance reduced to R223 million and Randfontein Estates' asset became a deferred tax liability.
The net deferred tax asset position of Harmony Company is as follows:
|
|
|
|
|
|
|
|
|
|
|
Figures in million
|
31 December
2020
(Reviewed)
|
30 June
2020
(Audited)
|
|
Deductible temporary differences
|
750
|
1 079
|
|
Assessed losses
|
—
|
574
|
|
Total
|
750
|
1 653
|
|
Deferred tax rate
|
29.8
|
%
|
29.8
|
%
|
|
Deferred tax asset
|
223
|
492
|
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (RAND)
7. TAXATION continued
Furthermore, the newly acquired Chemwes company is in a net deferred tax asset position as disclosed below:
|
|
|
|
|
|
|
|
Figures in million
|
31 December
2020
(Reviewed)
|
|
Deductible temporary differences
|
491
|
|
Total
|
491
|
|
Deferred tax rate
|
18.0
|
%
|
|
Deferred tax asset
|
88
|
Due to the higher short-term Rand gold price it is probable that sufficient future taxable profits will be available against which the remaining deductible temporary differences existing at the reporting date can be utilised. Consequently, a deferred tax asset continues to be recognised for Harmony Company and the Chemwes Company.
8. EARNINGS/(LOSS) PER ORDINARY SHARE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
|
Year ended
|
|
|
|
31 December
2020
(Reviewed)
|
31 December
2019
(Reviewed)
|
30 June
2020
(Audited)
|
|
Weighted average number of shares (million)
|
|
599
|
|
535
|
|
535
|
|
|
Weighted average number of diluted shares (million)
|
|
613
|
|
549
|
|
547
|
|
|
Total earnings/(loss) per share (cents):
|
|
|
|
|
|
Basic earnings/(loss)
|
|
966
|
|
249
|
|
(164)
|
|
|
Diluted earnings/(loss)
|
|
943
|
|
240
|
|
(166)
|
|
|
Headline earnings/(loss)
|
|
775
|
|
249
|
|
(154)
|
|
|
Diluted headline earnings/(loss)
|
|
758
|
|
240
|
|
(157)
|
|
Reconciliation of headline earnings:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
|
Year ended
|
|
Figures in million
|
|
31 December
2020
(Reviewed)
|
31 December
2019
(Reviewed)
|
30 June
2020
(Audited)
|
|
Net profit/(loss) for the period attributable to owners of the parent
|
|
5 785
|
|
1 332
|
|
(878)
|
|
|
Adjusted for:
|
|
|
|
|
|
Gain on bargain purchase1
|
|
(1 153)
|
|
—
|
|
—
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Profit on sale of property, plant and equipment
|
|
(4)
|
|
(1)
|
|
(2)
|
|
|
Taxation effect on profit on sale of property, plant and equipment
|
|
1
|
|
—
|
|
—
|
|
|
Loss on scrapping of property, plant and equipment
|
|
19
|
|
—
|
|
62
|
|
|
Taxation effect on loss on scrapping of property, plant and equipment
|
|
(4)
|
|
—
|
|
(10)
|
|
|
Headline earnings/(loss)
|
|
4 644
|
|
1 331
|
|
(828)
|
|
1 There is no tax effect on this item.
9. PROPERTY, PLANT AND EQUIPMENT AND INTANGIBLE ASSETS
The major movements in property, plant and equipment are related to the acquisition of AngloGold Ashanti Limited's remaining South African producing assets and related liabilities Refer to note 13 for further information on the acquisition.
At 31 December 2020, management performed an assessment for potential indicators of impairment of assets in terms of IAS 36, Impairment of Assets. The following operations were considered to have such indicators due to the specific circumstances experienced during the six months since the last impairment assessment:
•Target 1 – Production was severely hampered by a collapse of infrastructure and spillover issues resulting from the collapse. A revised life-of-mine plan for the remaining portion of FY21 has been approved by the board of directors.
•Bambanani – Grade was lower than planned due to the interception of a lower grade block sooner than expected. Seismicity is a risk due to the nature of the mining.
•Joel – Grade and kilograms produced is the main reason for the loss for the six months, due to mining discipline.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (RAND)
9. PROPERTY, PLANT AND EQUIPMENT AND INTANGIBLE ASSETS continued
These circumstances were considered to be impairment triggers and an impairment test was performed. All key assumptions disclosed remained the same as at 30 June 2020, with the exception of the discount rates for Bambanani and Target 1, which were adjusted for additional risk factors that are not included in the cash flows. The gold price was also increased to the following prices:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Short term
Year 1
|
Medium term
Year 2
|
Medium term
Year 3
|
Long term
Year 4
|
|
Gold price (R/kg)
|
938 000
|
|
895 000
|
|
805 000
|
|
700 000
|
|
The recoverable amounts of these assets have been determined on a fair value less costs to sell basis. These are fair value measurements classified as level 3.
Based on the impairment tests performed, no impairments were recorded for the period under review. On assessing for a potential reversal of previously recognised impairment losses, management concluded, similarly to the position at 30 June 2020, that although on an overall basis the gold price had improved from the time that the impairment losses had been recognised, the specific circumstances that led to the original impairments had not reversed. Management also considered the level of uncertainty of the impact of COVID-19 on production and therefore on the cash flows. Due to the volatility embedded in the potential upside driven by the higher gold prices in the short to medium term, coupled with the fact that the factors resulting in the previously recognised impairment losses had not reversed, management resolved it to be appropriate for no reversal of previously recognised impairment losses to be recorded for the period under review.
One of the most significant assumptions that influences the life-of-mine plans and therefore the impairment assessment is the expected commodity prices. The sensitivity scenario of a 10% decrease in the commodity price used in the discounted cash flow models and the resource values used (with all other variables held constant) would have resulted in the following impairment being recorded as at 31 December 2020:
•Joel – a 10% decrease in the gold price would have resulted in a R77 million impairment charge being recorded.
10. DERIVATIVE FINANCIAL INSTRUMENTS
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Figures in million
|
Rand gold hedging contracts (a)
|
US$ gold hedging contracts
|
US$ silver contracts
|
Foreign exchange contracts
|
Rand gold derivative contracts
|
Total
|
|
As at 31 December 2020 (Reviewed)
|
|
|
|
|
|
|
|
Derivative financial assets
|
811
|
|
10
|
|
—
|
|
510
|
|
—
|
|
1 331
|
|
|
Non-current
|
508
|
|
8
|
|
—
|
|
97
|
|
—
|
|
613
|
|
|
Current
|
303
|
|
2
|
|
—
|
|
413
|
|
—
|
|
718
|
|
|
Derivative financial liabilities
|
(1 203)
|
|
(290)
|
|
(180)
|
|
(8)
|
|
(61)
|
|
(1 742)
|
|
|
Non-current
|
(22)
|
|
(45)
|
|
(48)
|
|
—
|
|
—
|
|
(115)
|
|
|
Current
|
(1 181)
|
|
(245)
|
|
(132)
|
|
(8)
|
|
(61)
|
|
(1 627)
|
|
|
|
|
|
|
|
|
|
|
Net derivative financial instruments
|
(392)
|
|
(280)
|
|
(180)
|
|
502
|
|
(61)
|
|
(411)
|
|
|
Unamortised day one net loss included above
|
30
|
|
10
|
|
—
|
|
—
|
|
—
|
|
40
|
|
|
Unrealised losses included in other reserves, net of tax
|
287
|
|
271
|
|
—
|
|
—
|
|
—
|
|
558
|
|
|
Realised losses included in revenue
|
(1 595)
|
|
(176)
|
|
—
|
|
—
|
|
—
|
|
(1 771)
|
|
|
Unrealised gains/(losses) on gold contracts recognised in other comprehensive income
|
1 670
|
|
(164)
|
|
—
|
|
—
|
|
—
|
|
1 506
|
|
|
|
|
|
|
|
|
|
|
Gains/(losses) on derivatives
|
—
|
|
—
|
|
(274)
|
|
1 105
|
|
101
|
|
932
|
|
|
Day one loss amortisation
|
(26)
|
|
(4)
|
|
—
|
|
—
|
|
—
|
|
(30)
|
|
|
|
|
|
|
|
|
|
|
Total gains/(losses) on derivatives
|
(26)
|
|
(4)
|
|
(274)
|
|
1 105
|
|
101
|
|
902
|
|
|
|
|
|
|
|
|
|
|
Hedge effectiveness
|
|
|
|
|
|
|
|
Changes in the fair value of the hedging instrument used as the basis for recognising hedge ineffectiveness
|
1 670
|
|
(164)
|
|
—
|
|
—
|
|
—
|
|
1 506
|
|
|
Changes in the fair value of the hedged item used as the basis for recognising hedge ineffectiveness
|
(1 670)
|
|
164
|
|
—
|
|
—
|
|
—
|
|
(1 506)
|
|
(a) Rand gold hedging contracts
All Rand gold forward contracts entered into after 1 October 2020 were apportioned to the Mponeng operation and will share in the gains and losses on those apportioned contracts.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (RAND)
10. DERIVATIVE FINANCIAL INSTRUMENTS continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Figures in million
|
Rand gold hedging contracts (a)
|
US$ gold hedging contracts
|
US$ silver contracts
|
Foreign exchange contracts
|
Rand gold derivative contracts
|
Total
|
|
As at 31 December 2019 (Reviewed)
|
|
|
|
|
|
|
|
Derivative financial assets
|
104
|
|
13
|
|
—
|
|
622
|
|
—
|
|
739
|
|
|
Non-current
|
86
|
|
8
|
|
—
|
|
109
|
|
—
|
|
203
|
|
|
Current
|
18
|
|
5
|
|
—
|
|
513
|
|
—
|
|
536
|
|
|
Derivative financial liabilities
|
(564)
|
|
(109)
|
|
(6)
|
|
—
|
|
(14)
|
|
(693)
|
|
|
Non-current
|
(142)
|
|
(19)
|
|
(1)
|
|
—
|
|
—
|
|
(162)
|
|
|
Current
|
(422)
|
|
(90)
|
|
(5)
|
|
—
|
|
(14)
|
|
(531)
|
|
|
|
|
|
|
|
|
|
|
Net derivative financial instruments
|
(460)
|
|
(96)
|
|
(6)
|
|
622
|
|
(14)
|
|
46
|
|
|
Unamortised day one net loss included above
|
24
|
|
13
|
|
—
|
|
—
|
|
—
|
|
37
|
|
|
Realised gains/(losses) included in other reserves
|
(289)
|
|
(28)
|
|
—
|
|
—
|
|
—
|
|
(317)
|
|
|
Unrealised losses included in other comprehensive income1
|
464
|
|
80
|
|
—
|
|
—
|
|
—
|
|
544
|
|
|
|
|
|
|
|
|
|
|
Gains included in gains on derivatives
|
—
|
|
|
(8)
|
|
243
|
|
(56)
|
|
179
|
|
|
Day one loss amortisation
|
(20)
|
|
(2)
|
|
—
|
|
—
|
|
—
|
|
(22)
|
|
|
|
|
|
|
|
|
|
|
Total gains/(losses) on derivatives
|
(20)
|
|
(2)
|
|
(8)
|
|
243
|
|
(56)
|
|
157
|
|
|
|
|
|
|
|
|
|
|
Hedge effectiveness
|
|
|
|
|
|
|
|
Changes in the fair value of the hedging instrument used as the basis for recognising hedge ineffectiveness
|
(464)
|
|
(80)
|
|
—
|
|
—
|
|
—
|
|
(544)
|
|
|
Changes in the fair value of the hedged item used as the basis for recognising hedge ineffectiveness
|
464
|
|
80
|
|
—
|
|
—
|
|
—
|
|
544
|
|
1This line item has been restated (refer to note 2). No other line items have been restated.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (RAND)
10. DERIVATIVE FINANCIAL INSTRUMENTS continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Figures in million
|
Rand gold hedging contracts
|
US$ gold hedging contracts
|
US$ silver contracts
|
Foreign exchange contracts
|
Rand gold derivative contracts
|
Total
|
|
As at 30 June 2020 (Audited)
|
|
|
|
|
|
|
|
Derivative financial assets
|
19
|
|
8
|
|
11
|
|
30
|
|
—
|
|
68
|
|
|
Non-current
|
10
|
|
5
|
|
5
|
|
30
|
|
—
|
|
50
|
|
|
Current
|
9
|
|
3
|
|
6
|
|
—
|
|
—
|
|
18
|
|
|
Derivative financial liabilities
|
(3 626)
|
|
(356)
|
|
(4)
|
|
(760)
|
|
(257)
|
|
(5 003)
|
|
|
Non-current
|
(717)
|
|
(96)
|
|
(1)
|
|
(65)
|
|
—
|
|
(879)
|
|
|
Current
|
(2 909)
|
|
(260)
|
|
(3)
|
|
(695)
|
|
(257)
|
|
(4 124)
|
|
|
|
|
|
|
|
|
|
|
Net derivative financial instruments
|
(3 607)
|
|
(348)
|
|
7
|
|
(730)
|
|
(257)
|
|
(4 935)
|
|
|
Unamortised day one net loss included above
|
18
|
|
8
|
|
—
|
|
—
|
|
—
|
|
26
|
|
|
Unrealised losses included in other reserves, net of tax
|
3 053
|
|
342
|
|
—
|
|
—
|
|
—
|
|
3 395
|
|
|
Realised losses included in revenue
|
(1 263)
|
|
(134)
|
|
—
|
|
—
|
|
—
|
|
(1 397)
|
|
|
Unrealised losses on gold contracts recognised in other comprehensive income
|
(4 820)
|
|
(391)
|
|
—
|
|
—
|
|
—
|
|
(5 211)
|
|
|
|
|
|
|
|
|
|
|
Gains/(losses) on derivatives
|
—
|
|
—
|
|
6
|
|
(1 235)
|
|
(174)
|
|
(1 403)
|
|
|
Unrealised losses reclassified to profit or loss as a result of discontinuance of hedge accounting
|
(235)
|
|
—
|
|
—
|
|
—
|
|
—
|
|
(235)
|
|
|
Day one loss amortisation
|
(34)
|
|
(6)
|
|
—
|
|
—
|
|
—
|
|
(40)
|
|
|
|
|
|
|
|
|
|
|
Total gains/(losses) on derivatives
|
(269)
|
|
(6)
|
|
6
|
|
(1 235)
|
|
(174)
|
|
(1 678)
|
|
|
|
|
|
|
|
|
|
|
Hedge effectiveness
|
|
|
|
|
|
|
|
Changes in the fair value of the hedging instrument used as the basis for recognising hedge ineffectiveness
|
(4 820)
|
|
(391)
|
|
—
|
|
—
|
|
—
|
|
(5 211)
|
|
|
Changes in the fair value of the hedged item used as the basis for recognising hedge ineffectiveness
|
4 820
|
|
391
|
|
—
|
|
—
|
|
—
|
|
5 211
|
|
Reconciliation of the hedge reserve:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
|
Year ended
|
|
Figures in million
|
|
31 December
2020
(Reviewed)
|
31 December
2019
(Restated)1
|
30 June
2020
(Audited)
|
|
Opening balance
|
|
(3 395)
|
|
(214)
|
|
(214)
|
|
|
Remeasurement of gold hedging contracts
|
|
2 852
|
|
(178)
|
|
(3 197)
|
|
|
Unrealised gain/(loss) on gold contracts
|
|
1 506
|
|
(544)
|
|
(5 211)
|
|
|
Unrealised losses reclassified to profit or loss as a result of discontinuance of hedge accounting
|
|
—
|
|
—
|
|
235
|
|
|
Released to revenue
|
|
1 771
|
|
317
|
|
1 397
|
|
|
Foreign exchange translation
|
|
53
|
|
—
|
|
(37)
|
|
|
Deferred taxation thereon
|
|
(478)
|
|
49
|
|
419
|
|
|
Attributable to non-controlling interest
|
|
(15)
|
|
—
|
|
16
|
|
|
Closing balance
|
|
(558)
|
|
(392)
|
|
(3 395)
|
|
1Refer to note 2.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (RAND)
10. DERIVATIVE FINANCIAL INSTRUMENTS continued
The following table shows the open position at the reporting date:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FY 2021
|
FY2022
|
FY2023
|
TOTAL
|
|
|
Q3
|
Q4
|
Q1
|
Q2
|
Q3
|
Q4
|
Q1
|
Q2
|
|
Foreign exchange contracts
|
|
|
|
|
|
|
|
|
|
|
Zero cost collars
|
|
|
|
|
|
|
|
|
|
|
US$m
|
84
|
|
61
|
|
47
|
|
42
|
|
27
|
|
—
|
|
—
|
|
—
|
|
261
|
|
|
Average Floor - R/US$
|
15.44
|
|
15.91
|
|
16.32
|
|
16.93
|
|
17.99
|
|
—
|
|
—
|
|
—
|
|
16.17
|
|
|
Average Cap - R/US$
|
16.62
|
|
17.28
|
|
17.9
|
|
18.54
|
|
19.65
|
|
—
|
|
—
|
|
—
|
|
17.57
|
|
|
Forward contracts
|
|
|
|
|
|
|
|
|
|
|
US$m
|
18
|
|
12
|
|
9
|
|
9
|
|
8
|
|
—
|
|
—
|
|
—
|
|
56
|
|
|
Average Forward rate - R/US$
|
16.90
|
|
16.93
|
|
18.18
|
|
18.41
|
|
18.71
|
|
—
|
|
—
|
|
—
|
|
17.76
|
|
|
R/gold
|
|
|
|
|
|
|
|
|
|
|
000 oz – restructured
|
8
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
8
|
|
|
'000 oz – cash flow hedge
|
92
|
|
86
|
|
79
|
|
70
|
|
58
|
|
48
|
|
29
|
|
1
|
|
463
|
|
|
Average R'000/kg
|
742
|
|
790
|
|
863
|
|
932
|
|
1025
|
|
1076
|
|
1109
|
|
1081
|
|
892
|
|
|
US$/gold
|
|
|
|
|
|
|
|
|
|
|
'000 oz – cash flow hedge
|
12
|
|
12
|
|
12
|
|
12
|
|
11
|
|
10
|
|
9
|
|
3
|
|
81
|
|
|
Average US$/oz
|
1 489
|
|
1 521
|
|
1 561
|
|
1 606
|
|
1 723
|
|
1 802
|
|
1 911
|
|
1 883
|
|
1 654
|
|
|
Total gold
|
|
|
|
|
|
|
|
|
|
|
000 oz
|
112
|
|
98
|
|
91
|
|
82
|
|
69
|
|
58
|
|
38
|
|
4
|
|
552
|
|
|
US$/silver
|
|
|
|
|
|
|
|
|
|
|
000 oz
|
375
|
|
375
|
|
365
|
|
335
|
|
315
|
|
285
|
|
175
|
|
25
|
|
2 250
|
|
|
Average Floor - US$/oz
|
18.29
|
|
18.42
|
|
18.61
|
|
19.52
|
|
20.05
|
|
20.43
|
|
23.13
|
|
24.24
|
|
19.51
|
|
|
Average Cap - US$/oz
|
19.84
|
|
20.02
|
|
20.26
|
|
21.35
|
|
22.05
|
|
22.49
|
|
25.45
|
|
26.84
|
|
21.32
|
|
Refer to note 14 for details on the fair value measurements.
11. BORROWINGS
The following events or transactions occurred during the six months ended 31 December 2020:
•On 6 July 2020 Harmony and its subsidiaries cancelled the bridge loan of US$200 million.
•The following repayments were made on the R2 billion facility:
–On 6 July 2020 R300 million, and
–On 6 October 2020 R600 million.
•The following repayments were made on the US$400 million facility:
–On 2 July 2020 US$20 million (R340 million),
–On 8 July 2020 US$20 million (R339 million), and
–On 8 October US$30 million (R497 million).
•The following repayments were made on the Westpac fleet loan:
–On 16 July 2020 US$2 million (R25 million), and
–On 14 October 2020 US$2 million (R25 million).
•The syndicate of lenders for the US$400 million facility agreed to the one year extension during July 2020, extending the maturity date to September 2023.
During June 2020, the company's lenders agreed to relax certain requirements for compliance with debt covenants until December 2020. The group complied with all debt covenants as at 31 December 2020.
Refer to note 20 for events subsequent to the reporting date.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (RAND)
11. BORROWINGS continued
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Figures in million
|
US$ term loan
US dollar
|
US$ RCF
US dollar
|
Rand term loan
SA rand
|
Rand RCF
SA rand
|
Westpac fleet loan US dollar
|
|
Borrowings summary at 31 December 2020
|
|
|
|
|
|
|
Original facility
|
200
|
|
200
|
|
600
|
|
1 400
|
|
N/A
|
|
Drawn down/ loan balance
|
200
|
|
80
|
|
600
|
|
—
|
|
11
|
|
|
Undrawn borrowing facilities
|
N/A
|
120
|
|
N/A
|
1 400
|
|
N/A
|
|
Maturity
|
September
|
September
|
November
|
November
|
July
|
|
2023
|
2023
|
2022
|
2022
|
2022
|
|
Interest rate
|
LIBOR +
3.05%
|
LIBOR +
2.90%
|
JIBAR +
2.90%
|
JIBAR +
2.80%
|
LIBOR +
3.20%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
|
Year ended
|
|
Figures in million
|
|
31 December
2020
(Reviewed)
|
31 December
2019
(Reviewed)
|
30 June 2020
(Audited)
|
|
Translation gain/(loss) on US$ facilities1
|
|
789
|
|
49
|
|
(967)
|
|
|
Rand/US$ exchange rate:
|
|
|
|
|
|
Closing/spot
|
|
14.69
|
|
13.99
|
|
17.32
|
|
|
Average
|
|
16.25
|
|
14.69
|
|
15.66
|
|
1 The remainder of foreign exchange translation gain or loss relates to the translation of cash from one currency to another.
12. STREAMING ARRANGEMENTS
Streaming arrangement with Franco-Nevada Barbados
Harmony's subsidiary, Chemwes, the owner of the Mine Waste Solutions operation (MWS) has a contract with Franco-Nevada Barbados (Franco-Nevada) where Franco-Nevada is entitled to receive 25% of all the gold produced through MWS. As part of the acquisition of MWS (refer to note 13), Harmony assumed the obligations enforced by the Franco-Nevada contract.
The contract is a streaming agreement that commenced on 17 December 2008 for which Franco-Nevada paid $125 million upfront for the right to purchase 25% of the gold production through MWS for a fixed amount of consideration until the balance of gold cap is delivered. As at 1 October 2020, the $125 million upfront payment has been settled. The gold cap is a provision included in the contract, which stipulates the maximum quantity of gold to be sold to Franco-Nevada over the term of the agreement. The consideration is determined as the lower of the quoted spot gold price as per the London Metals Exchange or $400 per ounce adjusted with the US annual inflation adjustment.
Harmony does not have an existing streaming arrangement and therefore a new accounting policy was developed for the classification and measurement of the transaction.
Accounting policy
The streaming contract was assessed and has been accounted for as an own-use customer contract. At acquisition, the Franco-Nevada contract was initially recognised at a fair value (refer to note 13) of R1.42 billion in accordance with IFRS 3. The fair value of the contract took into consideration the existing unfavourable gold price terms at acquisition, in relation to the comparative market gold price.
The obligation to deliver the contractually stipulated ounces over the remaining term of the agreement results in a significant financing component. The interest accrues on the contract liability over the remaining contractual term. As the performance obligation to deliver gold is met, the contract liability unwinds into revenue classified as "consideration from streaming contract" in note 4.
The current portion of the liability is determined with reference to the current production profile of MWS for the next 12 months.
Contract liability and gold delivered
As at 1 October 2020, the balance of gold ounces to be delivered to Franco-Nevada amounted to 100 686oz. Subsequent to 1 October 2020, 5 793oz had been delivered to Franco-Nevada bringing the balance of gold ounces to be delivered as at 31 December 2020 to 94 893oz.
The contract price receivable in $/oz for each ounce of gold delivered is as follows:
•1 October 2020 – 16 December 2020: $433.13/oz
•17 December 2020 – 31 December 2020: $437.47/oz
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (RAND)
12. STREAMING ARRANGEMENTS continued
Contract liability and gold delivered continued
Reconciliation of contract liability:
|
|
|
|
|
|
|
|
Figures in million
|
Streaming contract
|
|
Balance at 1 October 2020 – initial recognition
|
1 417
|
|
|
Finance costs related to significant financing component
|
25
|
|
|
Non-cash consideration for delivery of gold ounces
|
(119)
|
|
|
Balance as at 31 December 2020
|
1 323
|
|
|
|
|
|
– Current
|
390
|
|
|
– Non-current
|
933
|
|
|
|
|
13. ACQUISITIONS AND BUSINESS COMBINATIONS
ACQUISITION OF ANGLOGOLD ASHANTI'S REMAINING SOUTH AFRICAN OPERATIONS
On 12 February 2020, Harmony announced that it had reached an agreement with AngloGold Ashanti Limited (AGA) to purchase AGA's remaining South African producing assets and related liabilities. Harmony's primary goal with the acquisition is to improve the group's overall recovered grade and increase cash flow margins. The transaction includes the following assets and liabilities:
•The Mponeng, Tau Tona and Savuka mines and associated rock-dump and tailings storage facility reclamation sites, mine rehabilitation and closure activities located in the West Wits region and their associated assets and liabilities;
•Certain rock-dump reclamation, mine rehabilitation and closure activities located in the Vaal River region and their associated assets and liabilities (the VR Remaining assets);
•100% of the share capital of First Uranium (Pty) Limited which owns Mine Waste Solutions (Pty) Limited and Chemwes (Pty) Limited as well as associated tailings assets and liabilities (the FUSA Group); and
•100% of the share capital of Covalent Water Company (Pty) Limited (CWC), AngloGold Security Services (Pty) Limited and Masakhisane Investments (Pty) Limited.
The last condition precedent for the acquisition was fulfilled during September 2020, resulting in an acquisition date of 1 October 2020.
Cash generating units identified
Based on management's assessment the transaction meets the definition of a business combination as defined by IFRS 3. The following cash generating units (CGUs) were identified in the acquisition:
•the Mponeng business, consisting of the Mponeng, Tau Tona and Savuka mines, forming a single complex, and their associated assets and liabilities, including CWC;
•the West Wits closure business, consisting of the Savuka plant and associated rock-dump and tailings storage facility reclamation sites, mine rehabilitation and closure activities located in the West Wits region and the associated assets and liabilities;
•Mine Waste Solutions;
•the Vaal River closure business, consisting of certain rock-dump reclamation, mine rehabilitation and closure activities located in the Vaal River region and their associated assets and liabilities.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (RAND)
13. ACQUISITIONS AND BUSINESS COMBINATIONS continued
ACQUISITION OF ANGLOGOLD ASHANTI'S REMAINING SOUTH AFRICAN OPERATIONS continued
Consideration transferred
Consideration for the transaction amounted to a cash payment of R3.366 billion (US$200 million), paid on 30 September 2020, and contingent consideration subject to the following criteria:
•US$260 per ounce payable on all underground production from the Mponeng, Savuka and Tau Tona mines in excess of 250 000 ounces per year for six years commencing 1 January 2021; and
•US$20 per ounce payable on underground production from the Mponeng, Savuka and Tau Tona mines sourced from levels developed in the future below the current infrastructure.
As at 1 October 2020, the contingent consideration was valued at R229 million by using a probability weighted method, discounted at a rate of 10.57%. As at 31 December 2020, the contingent consideration was valued at R 237 million. No material changes to the assumptions underpinning the valuation were made. The remeasurement of the liability is included in Other operating expenses.
The amount disclosed in the cash flow statement for cash paid for the acquisition of the Mponeng operation and related assets is determined as follows:
|
|
|
|
|
|
|
|
Figures in million
|
Total
|
|
Cash consideration paid
|
3 366
|
|
|
Cash acquired
|
(3)
|
|
|
Net cash paid
|
3 363
|
|
Acquisition and integration costs
The total of R111 million for acquisition costs for the six months ended 31 December 2020 relates to various costs directly attributable to the acquisition process. These costs include attorney and advisory fees.
There have also been costs incurred for the integration of the acquired assets into Harmony's existing structures and systems. These costs include project management and consultancy fees and software licensing costs required to interface with the Harmony systems. These costs amounted to R96 million (2020: R4 million) for the period ended 31 December 2020 and have been included in Corporate, administration and other expenditure.
Identifiable assets acquired and liabilities assumed
The fair value exercise was prepared on a provisional basis in accordance with IFRS 3. The values measured on a provisional basis included, inter alia, property, plant and equipment, the environmental rehabilitation provision and the deferred tax associated with these balances. Management is still in the process of gathering and assessing certain information on key estimations and the impact thereof on the provisional fair values. No measurement period adjustments have been recognised for the six-month period ended 31 December 2020.
Critical estimates and assumptions of business valuations performed
Key assumptions for the valuation of the respective CGUs are the gold prices, marketable discount rates, exchange rates and life-of-mine plans. Due to the volatility embedded in the potential upside driven by the higher gold prices in the short to medium term, management opted to adopt conservative gold price assumptions in order to accommodate for this. Management has considered the impact of the COVID-19 pandemic on the valuations performed and made adjustments to the production and cost estimates for the respective CGUs.
The fair value of the identifiable net assets acquired was determined on the expected discounted cash flows based on the life-of-mine plans of the Mponeng business (Mponeng), West Wits Closure business (WW), Mine Waste Solutions (MWS) and the Vaal River closure business (VR). The post-tax real discount rates used ranged from 8.47% to 11.61%, real exchange rates ranged between R14.41/US$1 and R16.75/US$1, real gold prices ranged between US$1 308/oz and US$1 784/oz. The valuation was performed as at 1 October 2020.
As part of determining the fair value of the provision for environmental rehabilitation the pre-tax risk-free rates used for discounting ranged between 5.1% and 11.5% while inflation of 5.0% was used for cost escalation.
The fair value of the unfavourable contract liability which forms part of the streaming arrangement with Franco-Nevada was measured at the difference between a market analyst consensus of gold prices and the fixed cash consideration to be received for gold delivered. A post-tax real rate of 11.58% was used to discount the liability over the expected period of delivery to settle the contract.
The deferred tax rates used to calculate deferred tax is based on the current estimate of future profitability when temporary differences will reverse based on tax rates and tax laws that have been enacted at acquisition date. Refer to note 7 for deferred tax rates used.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (RAND)
13. ACQUISITIONS AND BUSINESS COMBINATIONS continued
ACQUISITION OF ANGLOGOLD ASHANTI'S REMAINING SOUTH AFRICAN OPERATIONS continued
Identifiable assets acquired and liabilities assumed continued
Fair value determination of acquired operations
The provisional fair values as at the acquisition date are as follows:
|
|
|
|
|
|
|
|
|
|
|
|
Figures in million
|
|
|
|
|
Total
|
|
Non-current assets
|
|
|
|
|
|
|
Property, plant and equipment
|
|
|
|
|
6 547
|
|
|
Restricted Investments
|
|
|
|
|
1 268
|
|
|
Deferred tax assets
|
|
|
|
|
103
|
|
|
Current assets
|
|
|
|
|
|
|
Inventories
|
|
|
|
|
454
|
|
|
Trade and other receivables
|
|
|
|
|
59
|
|
|
Cash and cash equivalents
|
|
|
|
|
3
|
|
|
Non-current liabilities
|
|
|
|
|
|
|
Deferred tax liabilities
|
|
|
|
|
(251)
|
|
|
Provision for environmental rehabilitation
|
|
|
|
|
(1 442)
|
|
|
Other non-current liabilities
|
|
|
|
|
(41)
|
|
|
Streaming contract liability
|
|
|
|
|
(938)
|
|
|
Current liabilities
|
|
|
|
|
|
|
Trade and other payables
|
|
|
|
|
(535)
|
|
|
Streaming contract liability
|
|
|
|
|
(479)
|
|
|
Provisional fair value of net identifiable assets acquired at 1 October 2020
|
|
|
|
|
4 748
|
|
At 31 December 2020, trade and other payables includes R482 million from the acquired operations as well as R294 million owing to AngloGold South Africa for services performed during the transition period of the acquisition.
Performance of acquired operations
For the three months ended 31 December 2020, the operations acquired contributed to revenue and profit as follows:
|
|
|
|
|
|
|
|
|
|
|
|
Figures in million
|
|
|
|
|
Total
|
|
1 October 2020 – 31 December 2020
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
2 836
|
|
|
Non-cash consideration for streaming arrangements
|
|
|
|
|
119
|
|
|
Total revenue
|
|
|
|
|
2 955
|
|
|
|
|
|
|
|
|
|
Production costs
|
|
|
|
|
(2 004)
|
|
|
Amortisation and depreciation
|
|
|
|
|
(99)
|
|
|
Acquisition cost
|
|
|
|
|
(17)
|
|
|
Investment income from restricted investments
|
|
|
|
|
33
|
|
|
Finance costs
|
|
|
|
|
(53)
|
|
|
Profit before taxation
|
|
|
|
|
815
|
|
|
Taxation
|
|
|
|
|
(8)
|
|
|
Profit after taxation
|
|
|
|
|
807
|
|
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (RAND)
13. ACQUISITIONS AND BUSINESS COMBINATIONS continued
ACQUISITION OF ANGLOGOLD ASHANTI'S REMAINING SOUTH AFRICAN OPERATIONS continued
Performance of acquired operations continued
Should the acquisition have occurred at the beginning of the period, the group’s pro forma unaudited consolidated revenue and unaudited consolidated profit would have increased as follows:
|
|
|
|
|
|
|
|
|
|
|
|
Figures in million
|
|
|
|
|
Total
|
|
1 July 2020 – 31 December 2020
|
|
|
|
|
|
|
Revenue
|
|
|
|
|
5 677
|
|
|
Non-cash consideration for streaming arrangements
|
|
|
|
|
238
|
|
|
Total revenue
|
|
|
|
|
5 915
|
|
|
|
|
|
|
|
|
|
Production costs
|
|
|
|
|
(3 821)
|
|
|
Amortisation and depreciation
|
|
|
|
|
(197)
|
|
|
Acquisition cost
|
|
|
|
|
(111)
|
|
|
Investment income from restricted investments
|
|
|
|
|
51
|
|
|
Finance costs
|
|
|
|
|
(107)
|
|
|
Profit before taxation
|
|
|
|
|
1 730
|
|
|
Taxation
|
|
|
|
|
(8)
|
|
|
Profit after taxation
|
|
|
|
|
1 722
|
|
Adjustments made to pro forma information
For the three months of October to December 2020 (Q2), the revenue and production cost figures as per the segmental operating results were used, with adjustments made to determine the profit/(loss) after tax of the acquired operations. These adjustments were:
•Non-cash consideration recognised from the streaming arrangement,
•Depreciation expensed;
•Costs incurred directly attributable to the acquisition;
•Investment income recognised from restricted investments;
•Finance costs recognised for provisions for environmental rehabilitation; and
•Finance costs recognised for significant financing components of the streaming arrangement.
For the three months of July to September 2020 (Q1), the segment operational results of AGA was used. Adjustments made to pro forma information to determine profit/(loss) were as follows:
•Depreciation expensed for Q1 was estimated to be the same as Q2, based on the fair values determined as at 1 October 2020. AGA did not recognise depreciation for Q1 in line with IFRS 5, Non-Current Assets Held For Sale.
•Non-cash consideration from the streaming arrangement, finance costs for provisions for environmental rehabilitation and the streaming arrangement for Q1 were based on the fair values determined as at 1 October 2020, using Harmony's accounting policies.
Gain on bargain purchase
Gain on bargain purchase has been recognised as follows:
|
|
|
|
|
|
|
|
Figures in million
|
Total
|
|
Consideration paid
|
|
|
– Cash consideration
|
3 366
|
|
|
– Contingent consideration
|
229
|
|
|
Fair value of net identifiable assets acquired
|
(4 748)
|
|
|
Gain on bargain purchase
|
(1 153)
|
|
The gain on bargain purchase realised can be attributed to the higher gold prices and R/$ exchange rate assumptions that were used in the business valuations performed as at 1 October 2020 when compared to the assumptions used when the transaction was negotiated. The gold price and exchange rate assumptions were impacted by the market uncertainty surrounding the COVID-19 pandemic, which has had a significant impact on the short- and medium-term assumptions that were included in the valuations.
Gain on bargain purchase has been included as a separate line item in the income statement.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (RAND)
14. FINANCIAL RISK MANAGEMENT ACTIVITIES
The COVID-19 pandemic continues to impact on various aspects of Harmony's operating environment. Where relevant, reference is made to certain impacts in the discussions below, however a detailed discussion thereof is included in note 3.
Foreign exchange risk
Harmony's revenues are sensitive to the R/US$ exchange rate as all revenues are generated by gold sales denominated in US$. A weakening of the Rand will increase the reported revenue total; conversely a strengthening will decrease it.
Harmony maintains a foreign currency derivative programme to manage foreign exchange risk. The limit currently set by the Board is 25% of the group's foreign exchange risk exposure for a period of 24 months. The audit and risk committee reviews the details of the programme quarterly. Refer to note 10 and the fair value determination section below for further detail on these contracts.
The Rand strengthened during the six months ended 31 December 2020, from R17.32/U$1 on 30 June 2020 to close at R14.68/US$1 on 31 December 2020 (31 December 2019: R13.99/US$1). This positively impacted on the derivative valuations. The Rand's levels also impacted positively on the translation of the US$ debt facilities at 31 December 2020. Refer to note 11 for detail.
Commodity price sensitivity
The profitability of the group’s operations, and the cash flows generated by those operations, are mainly affected by changes in the market price of gold, and in the case of Hidden Valley, silver as well. Harmony enters into derivative contracts to manage the variability in cash flows from the group’s production, in order to create cash certainty and protect the group against lower commodity prices. The general limit for gold hedging currently set by the Board is 20% for a 24-month period. The limit set by the Board is 50% of silver exposure over a 24-month period. The audit and risk committee reviews the details of the programme quarterly. Refer to note 10 and the fair value determination section below for further detail on these contracts.
A decrease in the price of gold in US$ terms, together with the strengthening of the Rand during December 2020 period, had a positive impact on the contracts that matured during the period as well as those that were outstanding at 31 December 2020.
Interest rate risk
Low interest rates are still being maintained by both the US Federal Reserve and the South African Reserve Bank, resulting in a favourable impact on the cost of debt. This has been supported by a strengthened Rand on the interest cost incurred on the US$ loan facilities.
Credit risk
Financial instruments which are subject to credit risk are restricted cash, restricted investments, derivative financial instruments and cash and cash equivalents, all of which are invested with financial institutions that meet the group's policy requirements for credit quality, as well as trade and other receivables (excluding non-financial instruments). In assessing the creditworthiness of local institutions, management uses the national scale long-term ratings.
During the June 2020 financial year, Fitch downgraded the major South African (SA) banks by one notch to AA- from AA following the impact of the COVID-19 pandemic. This rating drop did not have a significantly adverse impact on the credit worthiness of the group's counterparts (SA financial Institutions). Fitch increased the credit rating of the major banks to AA+ on 22 December 2020, citing the financial institutions risk appetite and corporate conduct as key factors of the upgrade.
Taking the above events into consideration, the national scale investment grade rating of these banks remains high, between AA- and AA+, and in line with the group's credit risk policy. An assessment of the expected credit losses (ECLs) for the financial assets measured at amortised costs at 31 December 2020 resulted in an immaterial amount for each instrument. The credit rating of the group's Australian counterparts has remained at AA-, yielding an immaterial ECL as well.
Management will continue to review the underlying strength of the South African economy as well as the creditworthiness of the financial institutions and make any changes deemed necessary to safeguard the assets and reduce the credit risk.
Capital risk management
An increased gold price and the positive contributions from the acquisition decreased the net debt balance during the period. It remains the group's objective to adhere to a conservative approach to debt and maintain low levels of gearing.
Net debt is as follows:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At
|
At
|
At
|
|
Figures in million
|
|
31 December
2020
(Reviewed)
|
30 June
2020
(Audited)
|
31 December
2019
(Reviewed)
|
|
Cash and cash equivalents
|
|
4 217
|
|
6 357
|
|
1 250
|
|
|
Borrowings
|
|
(4 797)
|
|
(7 718)
|
|
(5 540)
|
|
|
Net debt
|
|
(580)
|
|
(1 361)
|
|
(4 290)
|
|
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (RAND)
14. FINANCIAL RISK MANAGEMENT ACTIVITIES continued
Fair value determination
The fair value levels of hierarchy are as follows:
|
|
|
|
|
|
|
|
Level 1:
|
Quoted prices (unadjusted) in active markets;
|
|
Level 2:
|
Inputs other than quoted prices included within level 1 that are observable for the asset, either directly or indirectly (that is, as prices) or indirectly (that is derived from prices);
|
|
Level 3:
|
Inputs for the asset that are not based on observable market data (that is unobservable inputs).
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
|
Year ended
|
|
Figures in million
|
Fair value hierarchy level
|
31 December
2020
(Reviewed)
|
31 December
2019
(Reviewed)
|
30 June
2020
(Audited)
|
|
Fair value through other comprehensive income financial instruments
|
|
|
|
|
|
Other non-current assets (a)
|
Level 3
|
69
|
|
72
|
|
77
|
|
|
Restricted investments (b)
|
Level 1
|
232
|
|
—
|
|
—
|
|
|
Fair value through profit or loss financial instruments
|
|
|
|
|
|
Restricted investments (b)
|
Level 2
|
42
|
|
—
|
|
—
|
|
|
Restricted investments (b)
|
Level 2
|
1 261
|
|
1 259
|
|
837
|
|
|
Derivative financial assets (c)
|
Level 2
|
1 331
|
|
739
|
|
68
|
|
|
Derivative financial liabilities (c)
|
Level 2
|
(1 742)
|
|
(693)
|
|
(5 003)
|
|
|
Loan to ARM BBEE Trust (d)
|
Level 3
|
302
|
|
285
|
|
306
|
|
|
Contingent consideration liability (e)
|
Level 3
|
(237)
|
|
—
|
|
—
|
|
(a) The majority of the balance relates to the equity investment in Rand Mutual Assurance. The fair value of the investment was estimated with reference to an independent valuation. A combination of the "Embedded Valuation" and "Net Asset Value" techniques were applied to revalue the investment as at 30 June 2020. In evaluating the group's share of the business, common practice marketability and minority discounts as well as additional specific risk discounts were applied.
(b) The majority of the level 2 valued assets are directly derived from the Top 40 index on the JSE, and is discounted at market interest rates. This relates to equity-linked deposits in the group's environmental rehabilitation trust funds. This includes investments in unit trust of R42 million.
The level 1 valued assets were acquired as part of the Mponeng operations and related assets (refer to note 13) and comprises of the following:
•Listed equity securities of R232 million designated as fair value through other comprehensive income instruments.
The remaining balance of the environmental trust funds is carried at amortised cost and therefore not disclosed here.
(c) The mark-to market remeasurement of the derivative contracts was determined as follows:
•Foreign exchange contracts comprise of zero cost collars and FECs: The zero cost collars were valued using a Black-Scholes valuation technique derived from spot Rand/US$ exchange rate inputs, implied volatilities on the Rand/US$ exchange rate,Rand/US$ inter-bank interest rates and discounted at a market interest rate (zero-coupon interest rate curve).The value of the FECs is derived from the forward Rand/US$ exchange rate and discounted at a market interest rate (zero coupon interest rate curve).
•Rand gold contracts (forward sale contracts): spot Rand/US$ exchange rate, Rand and dollar interest rates (forward points), spot US$ gold price, differential between the US interest rate and gold lease interest rate which is discounted at a market interest rate.
•US$ gold contracts (forward sale contracts): spot US$ gold price, differential between the US interest rate and gold lease interest rate and discounted at a market interest rate.
•Silver contracts (zero cost collars): a Black-Scholes valuation technique, derived from spot US$ silver price, strike price, implied volatilities, time to maturity and interest rates and discounted at a market interest rate investments.
(d) The fair value was calculated using a discounted cash flow model, taking into account projected interest payments and the projected share price for African Rainbow Minerals Limited (ARM) on the expected repayment date. A 10% change in the discount rate of 9.8% would not cause a material change to the fair value of the loan. The fair value of the loan balance is limited to the sum of the capital amounts plus cumulative interest not paid, being R302 million.
(e) The Mponeng consideration (refer to note 13) includes a contingent consideration determined through a probability weighted method -with various expected gold production profile scenarios- at a post-tax real rate of 10.57%.
The carrying values (less any impairment allowance) of short-term financial instruments are assumed to approximate their fair values. This includes restricted investments carried at amortised cost. The fair values of borrowings are not materially different to their carrying amounts since the interest payable on those borrowings is at floating interest rates. The fair value of borrowings is based on discounted cash flows using a current borrowing rate. The determination of the fair values are level 3 in the fair value hierarchy due to the use of unobservable inputs, including own credit risk.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (RAND)
15. ADDITIONAL CASH FLOW DISCLOSURES
Additions to property, plant and equipment
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
|
Year ended
|
|
Figures in million
|
|
31 December
2020
(Reviewed)
|
31 December
2019
(Reviewed)
|
30 June
2020
(Audited)
|
|
Capital expenditure – operations
|
|
1 856
|
|
1 695
|
|
2 881
|
|
|
Capital and capitalised exploration and evaluation expenditure for Wafi-Golpu
|
|
23
|
|
40
|
|
54
|
|
|
Additions resulting from stripping activities
|
|
487
|
|
535
|
|
675
|
|
|
Total additions to property, plant and equipment
|
|
2 366
|
|
2 270
|
|
3 610
|
|
16. COMMITMENTS AND CONTINGENCIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At
|
At
|
At
|
|
Figures in million
|
|
31 December
2020
(Reviewed)
|
30 June
2020
(Audited)
|
31 December
2019
(Reviewed)
|
|
Capital expenditure commitments:
|
|
|
|
|
|
Contracts for capital expenditure
|
|
440
|
|
368
|
|
463
|
|
|
Authorised by the directors but not contracted for
|
|
2 751
|
|
1 314
|
|
1 373
|
|
|
Total capital commitments
|
|
3 191
|
|
1 682
|
|
1 836
|
|
The acquisition of the Mponeng operations and related assets contributed a R521 million increase to the capital commitments.
This expenditure will be financed from existing resources and, where appropriate, borrowings.
Contingent liabilities
There were no significant changes during the six month period ended 31 December 2020. For detailed disclosure on contingent liabilities refer to Harmony's annual financial statements for the financial year ended 30 June 2020.
17. RELATED PARTIES
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name of director/prescribed officer
|
|
Shares purchased in open market
|
Shares sold in open market
|
Performance and deferred shares vested and retained
|
|
P Steenkamp (Executive director)
|
|
—
|
|
—
|
|
450 397
|
|
|
B Lekubo (Executive director)
|
|
—
|
|
—
|
|
3 581
|
|
|
HE Mashego (Executive director)
|
|
—
|
|
—
|
|
3 319
|
|
|
B Nel (Prescribed officer)
|
|
—
|
|
—
|
|
173 689
|
|
|
V Tobias (Prescribed officer)
|
|
—
|
|
1 500
|
|
177 597
|
|
|
M van der Walt (Prescribed officer)
|
|
—
|
|
—
|
|
139 356
|
|
|
J van Heerden (Prescribed officer)
|
|
—
|
|
—
|
|
6 156
|
|
–On 14 August 2020, Ms Shela Mohatla was appointed as Group Company Secretary by the board of directors. At the same time Mrs Marian van der Walt was appointed as Senior Group Executive: Enterprise Risk and Investor Relations and will be regarded as a prescribed officer going forward.
–On 30 September 2020, Harmony announced the resignation of Mr Ken Dicks and Mr Max Sisulu as independent non-executive directors as well as the retirement of Mr Frank Abbott as executive director with effect from 30 September 2020.
–On 18 December 2020, Harmony announced the resignation of Ms Grathel Motau as independent non-executive director with effect from 18 December 2020.
–For detailed disclosure on related parties refer to Harmony's annual financial statements for the financial year ended 30 June 2020.
NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS continued
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (RAND)
18. SEGMENT REPORT
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker (CODM).
With the purchase of AGA's remaining South African producing assets and related liabilities, the following CGUs were identified in the acquisition of the Mponeng operations and related assets:
•the Mponeng business;
•the West Wits closure business;
•Mine Waste Solutions; and
•the Vaal River Closure business.
The Mponeng business is disclosed separately in the segment report under the underground section while Mine Waste Solutions, the West Wits and the Vaal River closure businesses are disclosed as part of the other surface operations.
The segment report follows on page 35.
19. RECONCILIATION OF SEGMENT INFORMATION
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
|
|
Figures in million
|
|
31 December
2020
(Reviewed)
|
31 December
2019
(Reviewed)
|
|
Reconciliation of production profit to gross profit/(loss)
|
|
|
|
|
Revenue
|
|
21 588
|
|
15 477
|
|
|
– Per segment report
|
|
21 018
|
|
15 009
|
|
|
– Other metal sales treated as by-product credits in the segment report
|
|
570
|
|
468
|
|
|
Production costs
|
|
(14 808)
|
|
(11 366)
|
|
|
– Per segment report
|
|
(14 238)
|
|
(10 898)
|
|
|
– Other metal sales treated as by-product credits in the segment report
|
|
(570)
|
|
(468)
|
|
|
|
|
|
|
|
Production profit per segment report
|
|
6 780
|
|
4 111
|
|
|
|
|
|
|
|
Amortisation and depreciation
|
|
(1 816)
|
|
(1 926)
|
|
|
Other cost of sales items
|
|
(298)
|
|
(206)
|
|
|
Gross profit as per income statement1
|
|
4 666
|
|
1 979
|
|
1 The reconciliation was done up to the first recognisable line item on the income statement. The reconciliation will follow the income statement after that.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At
|
At
|
|
Figures in million
|
|
31 December
2020
(Reviewed)
|
31 December
2019
(Reviewed)
|
|
Reconciliation of total segment mining assets to consolidated property, plant and equipment
|
|
|
|
|
Property, plant and equipment not allocated to a segment
|
|
|
|
|
Mining assets
|
|
343
|
|
364
|
|
|
Undeveloped property
|
|
3 681
|
|
3 681
|
|
|
Other non-mining assets
|
|
102
|
|
126
|
|
|
Wafi-Golpu assets
|
|
2 502
|
|
2 450
|
|
|
|
|
6 628
|
|
6 621
|
|
20. SUBSEQUENT EVENTS
On 4 January 2021 Harmony repaid US$50 million (R736 million) on the US$400 million facility.
On 8 February 2021 Harmony repaid R75 million on the R2 billion facility.
On 19 February 2021, the board declared a dividend of 110 SA cents (7.5 US cents) per share for the half year ended 31 December 2020, payable on 19 April 2021.
On 19 February 2021, Peter Turner was appointed as a director and a member of Harmony's technical committee.
SEGMENT REPORT (RAND/METRIC)
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (REVIEWED)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
Production cost
|
Production
profit/(loss)
|
Mining assets
|
Capital expenditure#
|
Kilograms produced*
|
Tonnes milled*
|
|
|
31 December
|
31 December
|
31 December
|
31 December
|
31 December
|
31 December
|
31 December
|
|
|
2020
|
2019
|
2020
|
2019
|
2020
|
2019
|
2020
|
2019
|
2020
|
2019
|
2020
|
2019
|
2020
|
2019
|
|
|
R million
|
R million
|
R million
|
R million
|
R million
|
kg
|
t'000
|
South Africa
Underground
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tshepong Operations
|
3 099
|
|
3 141
|
|
2 495
|
|
2 310
|
|
604
|
|
831
|
|
6 957
|
|
6 591
|
|
464
|
|
572
|
|
3 453
|
|
4 479
|
|
733
|
|
889
|
|
|
Moab Khotsong
|
3 403
|
|
2 854
|
|
2 028
|
|
1 795
|
|
1 375
|
|
1 059
|
|
4 318
|
|
3 783
|
|
294
|
|
298
|
|
3 725
|
|
3 987
|
|
440
|
|
456
|
|
|
Mponeng
|
1 746
|
|
—
|
|
1 150
|
|
—
|
|
596
|
|
—
|
|
4 689
|
|
—
|
|
218
|
|
—
|
|
1 874
|
|
—
|
|
228
|
|
—
|
|
|
Bambanani
|
946
|
|
910
|
|
594
|
|
565
|
|
352
|
|
345
|
|
387
|
|
488
|
|
33
|
|
31
|
|
1 050
|
|
1 297
|
|
117
|
|
123
|
|
|
Joel
|
617
|
|
599
|
|
572
|
|
546
|
|
45
|
|
53
|
|
1 129
|
|
1 047
|
|
88
|
|
91
|
|
685
|
|
855
|
|
169
|
|
233
|
|
|
Doornkop
|
1 756
|
|
1 166
|
|
1 098
|
|
923
|
|
658
|
|
243
|
|
2 938
|
|
2 828
|
|
225
|
|
167
|
|
1 940
|
|
1 632
|
|
445
|
|
381
|
|
|
Target 1
|
945
|
|
742
|
|
850
|
|
761
|
|
95
|
|
(19)
|
|
1 350
|
|
1 199
|
|
183
|
|
192
|
|
1 021
|
|
1 136
|
|
280
|
|
305
|
|
|
Kusasalethu
|
2 105
|
|
1 189
|
|
1 601
|
|
1 391
|
|
504
|
|
(204)
|
|
1 163
|
|
1 274
|
|
91
|
|
118
|
|
2 305
|
|
1 648
|
|
375
|
|
349
|
|
|
Masimong
|
838
|
|
818
|
|
715
|
|
684
|
|
123
|
|
134
|
|
32
|
|
65
|
|
11
|
|
17
|
|
994
|
|
1 208
|
|
258
|
|
311
|
|
|
Unisel1
|
224
|
|
397
|
|
182
|
|
320
|
|
42
|
|
77
|
|
—
|
|
29
|
|
—
|
|
5
|
|
247
|
|
586
|
|
57
|
|
136
|
|
|
Surface
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All other surface operations
|
3 340
|
|
1 373
|
|
2 083
|
|
999
|
|
1 257
|
|
374
|
|
2 498
|
|
716
|
|
150
|
|
33
|
|
3 741
|
|
2 009
|
|
15 972
|
|
7 862
|
|
|
Total South Africa
|
19 019
|
|
13 189
|
|
13 368
|
|
10 296
|
|
5 651
|
|
2 893
|
|
25 461
|
|
18 020
|
|
1 757
|
|
1 524
|
|
21 035
|
|
18 837
|
|
19 074
|
|
11 045
|
|
|
International
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hidden Valley
|
1 999
|
|
1 820
|
|
870
|
|
602
|
|
1 129
|
|
1 218
|
|
3 091
|
|
3 568
|
|
585
|
|
706
|
|
2 148
|
|
2 574
|
|
1 789
|
|
2 039
|
|
|
Total international
|
1 999
|
|
1 820
|
|
870
|
|
602
|
|
1 129
|
|
1 218
|
|
3 091
|
|
3 568
|
|
585
|
|
706
|
|
2 148
|
|
2 574
|
|
1 789
|
|
2 039
|
|
|
Total operations
|
21 018
|
|
15 009
|
|
14 238
|
|
10 898
|
|
6 780
|
|
4 111
|
|
28 552
|
|
21 588
|
|
2 342
|
|
2 230
|
|
23 183
|
|
21 411
|
|
20 863
|
|
13 084
|
|
|
Reconciliation of the segment information to the consolidated income statement and balance sheet (refer to note 19)
|
570
|
|
468
|
|
570
|
|
468
|
|
—
|
|
—
|
|
6 628
|
|
6 621
|
|
|
|
|
|
|
|
|
|
21 588
|
|
15 477
|
|
14 808
|
|
11 366
|
|
6 780
|
|
4 111
|
|
35 180
|
|
28 209
|
|
2 342
|
|
2 230
|
|
23 183
|
|
21 411
|
|
20 863
|
|
13 084
|
|
# Capital expenditure for international operations excludes expenditure spent on Wafi-Golpu of R23 million (2019: R40 million).
* Production statistics are unaudited and not reviewed.
1 The Unisel operation closed in October 2020.
CONDENSED CONSOLIDATED INCOME STATEMENT (US$)
(CONVENIENCE TRANSLATION) (UNAUDITED AND UNREVIEWED)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
|
Year ended
|
|
Figures in million
|
|
31 December
2020
|
31 December
2019
|
30 June
2020
|
|
Revenue
|
|
1 329
|
|
1 054
|
|
1 867
|
|
|
Cost of sales
|
|
(1 041)
|
|
(919)
|
|
(1 655)
|
|
|
Production costs
|
|
(911)
|
|
(774)
|
|
(1 409)
|
|
|
Amortisation and depreciation
|
|
(112)
|
|
(131)
|
|
(224)
|
|
|
|
|
|
|
|
|
Other items
|
|
(18)
|
|
(14)
|
|
(22)
|
|
|
|
|
|
|
|
|
Gross profit
|
|
288
|
|
135
|
|
212
|
|
|
Corporate, administration and other expenditure
|
|
(33)
|
|
(23)
|
|
(39)
|
|
|
Exploration expenditure
|
|
(5)
|
|
(9)
|
|
(13)
|
|
|
Gains/(losses) on derivatives
|
|
56
|
|
11
|
|
(107)
|
|
|
Foreign exchange translation gain/(loss)
|
|
40
|
|
2
|
|
(57)
|
|
|
Other operating expenses
|
|
(3)
|
|
(4)
|
|
(20)
|
|
|
Operating profit/(loss)
|
|
343
|
|
112
|
|
(24)
|
|
|
Share of profits from associates
|
|
4
|
|
3
|
|
6
|
|
|
Gain on bargain purchase
|
|
69
|
|
—
|
|
—
|
|
|
Acquisition costs
|
|
(7)
|
|
—
|
|
(3)
|
|
|
Investment income
|
|
15
|
|
10
|
|
24
|
|
|
Finance costs
|
|
(20)
|
|
(23)
|
|
(42)
|
|
|
Profit/(loss) before taxation
|
|
404
|
|
102
|
|
(39)
|
|
|
Taxation
|
|
(48)
|
|
(11)
|
|
(17)
|
|
|
Current taxation
|
|
(20)
|
|
(4)
|
|
(4)
|
|
|
Deferred taxation
|
|
(28)
|
|
(7)
|
|
(13)
|
|
|
|
|
|
|
|
|
Net profit/(loss) for the period
|
|
356
|
|
91
|
|
(56)
|
|
|
Attributable to:
|
|
|
|
|
|
Non-controlling interest
|
|
2
|
|
—
|
|
2
|
|
|
Owners of the parent
|
|
354
|
|
91
|
|
(58)
|
|
|
Earnings/(loss) per ordinary share (cents)
|
|
|
|
|
|
Basic earnings/(loss)
|
|
59
|
|
17
|
|
(10)
|
|
|
Diluted earnings/(loss)
|
|
57
|
|
16
|
|
(11)
|
|
The currency conversion average rates for the six months ended 31 December 2020: US$1 = R16.25 (31 December 2019: US$1 = R14.69) (30 June 2020 US$1 = R15.66)
|
|
|
|
|
Note on convenience translations
The requirements of IAS 21 The Effects of the Changes in Foreign Exchange Rates have not necessarily been applied in the translation of the US Dollar financial statements presented on page 36 to 40.
|
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME (US$)
(CONVENIENCE TRANSLATION) (UNAUDITED AND UNREVIEWED)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months period
|
Year ended
|
|
Figures in million
|
|
31 December
2020
|
31 December
2019
Restated*
|
30 June
2020
|
|
Net loss for the year
|
|
356
|
|
91
|
|
(56)
|
|
|
Other comprehensive income for the year, net of income tax
|
|
108
|
|
(18)
|
|
(124)
|
|
|
Items that may be reclassified subsequently to profit or loss:
|
|
107
|
|
(19)
|
|
(127)
|
|
|
Foreign exchange translation gain/(loss)
|
|
(69)
|
|
(29)
|
|
77
|
|
|
|
|
|
|
|
|
Remeasurement of gold hedging contracts
|
|
176
|
|
10
|
|
(204)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Items that will not be reclassified to profit or loss:
|
|
1
|
|
1
|
|
3
|
|
|
Gain on assets measured at fair value through other comprehensive income
|
|
1
|
|
1
|
|
2
|
|
|
|
|
|
|
|
|
Actuarial gain recognised during the year
|
|
—
|
|
—
|
|
1
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total comprehensive income for the year
|
|
464
|
|
73
|
|
(180)
|
|
|
Attributable to:
|
|
|
|
|
|
Non-controlling interest
|
|
2
|
|
—
|
|
—
|
|
|
Owners of the parent
|
|
462
|
|
73
|
|
(180)
|
|
The currency conversion average rates for the six months ended 31 December 2020: US$1 = R16.25 (31 December 2019: US$1 = R14.69) (30 June 2020: US$1 = R15.66)
*Refer to note 2 for detail. The restated amounts are unaudited.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (US$)
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (CONVENIENCE TRANSLATION) (UNAUDITED AND UNREVIEWED)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Figures in million
|
|
Share
capital
|
Accumulated loss
|
Other
reserves
|
Non-controlling interest
|
Total
|
|
Balance – 1 July 2020
|
|
2 242
|
|
(819)
|
|
206
|
|
—
|
|
1 629
|
|
|
|
|
|
|
|
|
|
|
Share-based payments
|
|
—
|
|
—
|
|
6
|
|
—
|
|
6
|
|
|
|
|
|
|
|
|
|
|
Net profit for the period
|
|
—
|
|
356
|
|
—
|
|
2
|
|
358
|
|
|
Other comprehensive income for the period
|
|
—
|
|
—
|
|
117
|
|
1
|
|
118
|
|
|
Balance – 31 December 2020
|
|
2 242
|
|
(463)
|
|
329
|
|
3
|
|
2 111
|
|
|
Balance – 1 July 2019
|
|
2 112
|
|
(836)
|
|
342
|
|
—
|
|
1 618
|
|
|
Share-based payments
|
|
—
|
|
—
|
|
6
|
|
—
|
|
6
|
|
|
Net profit for the period
|
|
—
|
|
95
|
|
—
|
|
—
|
|
95
|
|
|
Other comprehensive income for the period
|
|
—
|
|
—
|
|
(18)
|
|
—
|
|
(18)
|
|
|
Balance – 31 December 2019
|
|
2 112
|
|
(741)
|
|
330
|
|
—
|
|
1 701
|
|
The currency conversion closing rates for the six months ended 31 December 2020: US$1 = R14.69 (31 December 2019: US$1 = R13.99).
CONDENSED CONSOLIDATED BALANCE SHEET (US$)
(CONVENIENCE TRANSLATION) (UNAUDITED AND UNREVIEWED)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At
|
At
|
At
|
|
Figures in million
|
|
31 December
2020
|
30 June
2020
|
31 December
2019
|
|
ASSETS
|
|
|
|
|
|
Non-current assets
|
|
|
|
|
|
Property, plant and equipment
|
|
2 395
|
|
1 685
|
|
2 016
|
|
|
Intangible assets
|
|
37
|
|
31
|
|
38
|
|
|
Restricted cash
|
|
9
|
|
5
|
|
7
|
|
|
Restricted investments
|
|
336
|
|
204
|
|
242
|
|
|
Investments in associates
|
|
10
|
|
8
|
|
7
|
|
|
Inventories
|
|
3
|
|
3
|
|
3
|
|
|
Deferred tax assets
|
|
21
|
|
31
|
|
—
|
|
|
Other non-current assets
|
|
26
|
|
22
|
|
26
|
|
|
Derivative financial assets
|
|
42
|
|
3
|
|
15
|
|
|
Total non-current assets
|
|
2 879
|
|
1 992
|
|
2 354
|
|
|
Current assets
|
|
|
|
|
|
Inventories
|
|
150
|
|
140
|
|
140
|
|
|
Restricted cash
|
|
5
|
|
4
|
|
4
|
|
|
Trade and other receivables
|
|
101
|
|
75
|
|
94
|
|
|
Derivative financial assets
|
|
49
|
|
1
|
|
38
|
|
|
Cash and cash equivalents
|
|
287
|
|
367
|
|
89
|
|
|
Total current assets
|
|
592
|
|
587
|
|
365
|
|
|
Total assets
|
|
3 471
|
|
2 579
|
|
2 719
|
|
|
EQUITY AND LIABILITIES
|
|
|
|
|
|
Share capital and reserves
|
|
|
|
|
|
Attributable to equity holders of the parent company
|
|
2 108
|
|
1 350
|
|
1 701
|
|
|
Share capital
|
|
2 242
|
|
1 902
|
|
2 112
|
|
|
Other reserves
|
|
329
|
|
174
|
|
330
|
|
|
Accumulated loss
|
|
(463)
|
|
(726)
|
|
(741)
|
|
|
Non-controlling interest
|
|
3
|
|
—
|
|
—
|
|
|
Total equity
|
|
2 111
|
|
1 350
|
|
1 701
|
|
|
Non-current liabilities
|
|
|
|
|
|
Deferred tax liabilities
|
|
123
|
|
58
|
|
54
|
|
|
Provision for environmental rehabilitation
|
|
324
|
|
197
|
|
225
|
|
|
Provision for silicosis settlement
|
|
45
|
|
41
|
|
53
|
|
|
Retirement benefit obligation
|
|
15
|
|
11
|
|
15
|
|
|
Borrowings
|
|
300
|
|
431
|
|
390
|
|
|
Contingent consideration liability
|
|
16
|
|
—
|
|
—
|
|
|
Other non-current liabilities
|
|
9
|
|
6
|
|
6
|
|
|
Derivative financial liabilities
|
|
8
|
|
51
|
|
12
|
|
|
Streaming contract financial liability
|
|
64
|
|
—
|
|
—
|
|
|
Total non-current liabilities
|
|
904
|
|
795
|
|
755
|
|
|
Current liabilities
|
|
|
|
|
|
|
|
|
|
|
|
Provision for silicosis settlement
|
|
12
|
|
10
|
|
13
|
|
|
Borrowings
|
|
27
|
|
15
|
|
6
|
|
|
|
|
|
|
|
|
Trade and other payables
|
|
279
|
|
171
|
|
206
|
|
|
Derivative financial liabilities
|
|
111
|
|
238
|
|
38
|
|
|
Streaming contract financial liability
|
|
27
|
|
—
|
|
—
|
|
|
Total current liabilities
|
|
456
|
|
434
|
|
263
|
|
|
Total equity and liabilities
|
|
3 471
|
|
2 579
|
|
2 719
|
|
The balance sheet for 31 December 2020 converted at a conversion rate of US$1 = R14.69 (30 June 2020: US$1 = R17.32) (31 December 2019: US$1 = R13.99)
CONDENSED CONSOLIDATED CASH FLOW STATEMENT (US$)
(CONVENIENCE TRANSLATION) (UNAUDITED AND UNREVIEWED)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Six months ended
|
Year ended
|
|
Figures in million
|
|
31 December
2020
|
31 December
2019
|
30 June
2020
|
|
CASH FLOW FROM OPERATING ACTIVITIES
|
|
|
|
|
|
Cash generated by operations
|
|
374
|
|
199
|
|
321
|
|
|
Interest received
|
|
2
|
|
3
|
|
5
|
|
|
Interest paid
|
|
(11)
|
|
(11)
|
|
(24)
|
|
|
Dividends received
|
|
3
|
|
—
|
|
—
|
|
|
Income and mining taxes paid
|
|
(12)
|
|
(5)
|
|
(2)
|
|
|
Cash generated from operating activities
|
|
356
|
|
186
|
|
300
|
|
|
CASH FLOW FROM INVESTING ACTIVITIES
|
|
|
|
|
|
Increase in restricted cash
|
|
(1)
|
|
(1)
|
|
(1)
|
|
|
Decrease in amounts invested in restricted investments
|
|
2
|
|
—
|
|
—
|
|
|
Redemption of preference shares from associates
|
|
2
|
|
4
|
|
4
|
|
|
Acquisition of the Mponeng operations and related assets
|
|
(200)
|
|
—
|
|
—
|
|
|
Additions to property, plant and equipment
|
|
(146)
|
|
(155)
|
|
(230)
|
|
|
Cash utilised by investing activities
|
|
(343)
|
|
(152)
|
|
(227)
|
|
|
CASH FLOW FROM FINANCING ACTIVITIES
|
|
|
|
|
|
Borrowings raised
|
|
—
|
|
323
|
|
418
|
|
|
Borrowings repaid
|
|
(131)
|
|
(341)
|
|
(361)
|
|
|
Proceeds from the issue of shares
|
|
—
|
|
—
|
|
200
|
|
|
|
|
|
|
|
|
Lease payments
|
|
(2)
|
|
(1)
|
|
(2)
|
|
|
Cash generated from financing activities
|
|
(133)
|
|
(19)
|
|
255
|
|
|
Foreign currency translation adjustments
|
|
40
|
|
4
|
|
(31)
|
|
|
Net increase/decrease in cash and cash equivalents
|
|
(80)
|
|
19
|
|
297
|
|
|
Cash and cash equivalents – beginning of period
|
|
367
|
|
70
|
|
70
|
|
|
Cash and cash equivalents – end of period
|
|
287
|
|
89
|
|
367
|
|
The currency conversion average rates for the six months ended 31 December 2020: US$1 = R16.25 (31 December 2019: US$1 = R14.69) (30 June 2020: US$1 = R15.66). The closing balance translated at closing rate of 31 December 2020: US$1 = R14.69 (30 June 2020: US$1 = R17.32) (31 December 2019: US$1: = R13.99).
SEGMENT REPORT (US$/IMPERIAL)
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020 (CONVENIENCE TRANSLATION) (UNAUDITED AND UNREVIEWED)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Revenue
|
Production cost
|
Production profit/(loss)
|
Mining assets
|
Capital expenditure#
|
Ounces produced
|
Tons milled
|
|
|
31 December
|
31 December
|
31 December
|
31 December
|
31 December
|
31 December
|
31 December
|
|
|
2020
|
2019
|
2020
|
2019
|
2020
|
2019
|
2020
|
2019
|
2020
|
2019
|
2020
|
2019
|
2020
|
2019
|
|
|
US$ million
|
US$ million
|
US$ million
|
US$ million
|
US$ million
|
oz
|
t'000
|
South Africa
Underground
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Tshepong Operations
|
191
|
|
214
|
|
154
|
|
157
|
|
37
|
|
57
|
|
474
|
|
471
|
|
29
|
|
39
|
|
111 016
|
|
144 003
|
|
808
|
|
980
|
|
|
Moab Khotsong
|
209
|
|
194
|
|
124
|
|
122
|
|
85
|
|
72
|
|
294
|
|
270
|
|
18
|
|
20
|
|
119 761
|
|
128 185
|
|
485
|
|
503
|
|
|
Mponeng
|
107
|
|
—
|
|
66
|
|
—
|
|
41
|
|
—
|
|
319
|
|
—
|
|
13
|
|
—
|
|
60 250
|
|
—
|
|
251
|
|
—
|
|
|
Bambanani
|
58
|
|
62
|
|
37
|
|
38
|
|
21
|
|
24
|
|
26
|
|
35
|
|
2
|
|
2
|
|
33 758
|
|
41 699
|
|
129
|
|
136
|
|
|
Joel
|
38
|
|
41
|
|
35
|
|
37
|
|
3
|
|
4
|
|
77
|
|
75
|
|
5
|
|
6
|
|
22 023
|
|
27 489
|
|
187
|
|
257
|
|
|
Doornkop
|
108
|
|
79
|
|
68
|
|
63
|
|
40
|
|
16
|
|
200
|
|
202
|
|
14
|
|
11
|
|
62 372
|
|
52 470
|
|
491
|
|
420
|
|
|
Target 1
|
58
|
|
51
|
|
52
|
|
52
|
|
6
|
|
(1)
|
|
92
|
|
86
|
|
11
|
|
13
|
|
32 825
|
|
36 523
|
|
308
|
|
336
|
|
|
Kusasalethu
|
130
|
|
81
|
|
99
|
|
95
|
|
31
|
|
(14)
|
|
79
|
|
91
|
|
6
|
|
8
|
|
74 107
|
|
52 984
|
|
413
|
|
385
|
|
|
Masimong
|
52
|
|
56
|
|
44
|
|
47
|
|
8
|
|
9
|
|
2
|
|
5
|
|
1
|
|
1
|
|
31 958
|
|
38 838
|
|
285
|
|
343
|
|
|
Unisel1
|
14
|
|
27
|
|
11
|
|
22
|
|
3
|
|
5
|
|
—
|
|
2
|
|
—
|
|
—
|
|
7 941
|
|
18 841
|
|
63
|
|
150
|
|
|
Surface
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
All other surface operations
|
206
|
|
93
|
|
132
|
|
68
|
|
74
|
|
25
|
|
170
|
|
51
|
|
9
|
|
4
|
|
120 276
|
|
64 591
|
|
17 614
|
|
8 670
|
|
|
Total South Africa
|
1 171
|
|
898
|
|
822
|
|
701
|
|
349
|
|
197
|
|
1 733
|
|
1 288
|
|
108
|
|
104
|
|
676 287
|
|
605 623
|
|
21 034
|
|
12 180
|
|
|
International
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Hidden Valley
|
123
|
|
124
|
|
54
|
|
41
|
|
69
|
|
83
|
|
210
|
|
255
|
|
36
|
|
48
|
|
69 060
|
|
82 756
|
|
1 973
|
|
2 248
|
|
|
Total international
|
123
|
|
124
|
|
54
|
|
41
|
|
69
|
|
83
|
|
210
|
|
255
|
|
36
|
|
48
|
|
69 060
|
|
82 756
|
|
1 973
|
|
2 248
|
|
|
Total operations
|
1 294
|
|
1 022
|
|
876
|
|
742
|
|
418
|
|
280
|
|
1 943
|
|
1 543
|
|
144
|
|
152
|
|
745 347
|
|
688 379
|
|
23 007
|
|
14 428
|
|
# Capital expenditure for international operations excludes expenditure spent on Wafi-Golpu of US$1 million (2019: US$3 million).
1 The Unisel operation closed in October 2020.
DEVELOPMENT RESULTS
FOR THE SIX MONTHS ENDED 31 DECEMBER 2020
METRIC
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CHANNEL
|
|
|
Reef
|
Sampled
|
Width
|
Value
|
Gold
|
|
|
Meters
|
Meters
|
(Cm's)
|
(g/t)
|
(Cmg/t)
|
|
Tshepong
|
|
Basal
|
506
|
476
|
8.79
|
117.01
|
1 029
|
|
B Reef
|
177
|
172
|
174.27
|
5.85
|
1 020
|
|
All Reefs
|
683
|
648
|
52.71
|
19.47
|
1 026
|
|
Phakisa
|
|
Basal
|
775
|
784
|
42.36
|
32.53
|
1 378
|
|
All Reefs
|
775
|
784
|
42.36
|
32.53
|
1 378
|
|
Doornkop
|
|
South Reef
|
848
|
684
|
68.71
|
15.43
|
1 060
|
|
All Reefs
|
848
|
684
|
68.71
|
15.43
|
1 060
|
|
Kusasalethu
|
|
VCR Reef
|
202
|
220
|
52.54
|
18.31
|
962
|
|
All Reefs
|
202
|
220
|
52.54
|
18.31
|
962
|
|
Target 1
|
|
Elsburg
|
157
|
72
|
253.33
|
7.50
|
1 900
|
|
All Reefs
|
157
|
72
|
253.33
|
7.50
|
1 900
|
|
Masimong 5
|
|
Basal
|
537
|
426
|
80.16
|
16.23
|
1 301
|
|
B Reef
|
419
|
390
|
82.64
|
22.32
|
1 845
|
|
All Reefs
|
956
|
816
|
81.35
|
19.19
|
1 561
|
|
Joel
|
|
Beatrix
|
874
|
852
|
147.00
|
6.72
|
988
|
|
All Reefs
|
874
|
852
|
147.00
|
6.72
|
988
|
|
Moab Khotsong
|
|
Vaal Reef
|
547
|
356
|
100.97
|
41.91
|
4 231
|
|
All Reefs
|
547
|
356
|
100.97
|
41.91
|
4 231
|
|
Mponeng
|
|
VCR
|
192
|
146
|
85.00
|
34.00
|
2 907
|
|
Carbon Leader
|
48
|
24
|
41.00
|
47.00
|
1 907
|
|
All Reefs
|
240
|
170
|
78.92
|
35.05
|
2 766
|
|
Total Harmony
|
|
Basal
|
1 818
|
1 686
|
42.44
|
29.69
|
1 260
|
|
Beatrix
|
874
|
852
|
147.00
|
6.72
|
988
|
|
B Reef
|
596
|
562
|
110.68
|
14.39
|
1 592
|
|
Elsburg
|
157
|
72
|
253.33
|
7.50
|
1 900
|
|
VRF
|
547
|
356
|
100.97
|
41.91
|
4 231
|
|
South Reef
|
848
|
684
|
68.71
|
15.43
|
1 060
|
|
VCR
|
394
|
366
|
65.58
|
26.50
|
1 738
|
|
Carbon Leader
|
48
|
24
|
40.53
|
47.05
|
1 907
|
|
All Reefs
|
5 282
|
4 602
|
83.69
|
17.94
|
1 502
|
VCR: Ventersdorp Contract Reef
IMPERIAL
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
CHANNEL
|
|
|
Reef
|
Sampled
|
Width
|
Value
|
Gold
|
|
|
Feet
|
Feet
|
(Inch)
|
(oz/t)
|
(In.oz/t)
|
|
Tshepong
|
|
Basal
|
1 659
|
1 562
|
3.00
|
3.94
|
12
|
|
B Reef
|
581
|
564
|
69.00
|
0.17
|
12
|
|
All Reefs
|
2 240
|
2 126
|
21.00
|
0.56
|
12
|
|
Phakisa
|
|
Basal
|
2 544
|
2 572
|
17.00
|
0.93
|
16
|
|
All Reefs
|
2 544
|
2 572
|
17.00
|
0.93
|
16
|
|
Doornkop
|
|
South Reef
|
2 783
|
2 244
|
27.00
|
0.45
|
12
|
|
All Reefs
|
2 783
|
2 244
|
27.00
|
0.45
|
12
|
|
Kusasalethu
|
|
VCR Reef
|
663
|
722
|
21.00
|
0.53
|
11
|
|
All Reefs
|
663
|
722
|
21.00
|
0.53
|
11
|
|
Target 1
|
|
Elsburg
|
515
|
236
|
100.00
|
0.22
|
22
|
|
All Reefs
|
515
|
236
|
100.00
|
0.22
|
22
|
|
Masimong 5
|
|
Basal
|
1 761
|
1 398
|
32.00
|
0.47
|
15
|
|
B Reef
|
1 375
|
1 280
|
33.00
|
0.64
|
21
|
|
All Reefs
|
3 136
|
2 678
|
32.00
|
0.56
|
18
|
|
Joel
|
|
Beatrix
|
2 866
|
2 795
|
58.00
|
0.20
|
11
|
|
All Reefs
|
2 866
|
2 795
|
58.00
|
0.20
|
11
|
|
Moab Khotsong
|
|
Vaal Reef
|
1 794
|
1 168
|
40.00
|
1.21
|
49
|
|
All Reefs
|
1 794
|
1 168
|
40.00
|
1.21
|
49
|
|
Mponeng
|
|
VCR
|
629
|
479
|
34.00
|
0.98
|
33
|
|
Carbon Leader
|
156
|
79
|
16.00
|
1.37
|
22
|
|
All Reefs
|
785
|
558
|
31.00
|
1.02
|
32
|
|
Total Harmony
|
|
Basal
|
5 964
|
5 532
|
17.00
|
0.85
|
14
|
|
Beatrix
|
2 866
|
2 795
|
58.00
|
0.20
|
11
|
|
B Reef
|
1 956
|
1 844
|
44.00
|
0.42
|
18
|
|
Elsburg
|
515
|
236
|
100.00
|
0.22
|
22
|
|
VRF
|
1 794
|
1 168
|
40.00
|
1.21
|
49
|
|
South Reef
|
2 783
|
2 244
|
27.00
|
0.45
|
12
|
|
VCR
|
1 292
|
1 201
|
26.00
|
0.77
|
20
|
|
Carbon Leader
|
156
|
79
|
16.00
|
1.37
|
22
|
|
All Reefs
|
17 326
|
15 099
|
33.00
|
0.52
|
17
|
COMPETENT PERSON'S DECLARATION
Harmony Gold Mining Company Limited’s statement of mineral resources and mineral reserves as at 30 June 2020 is produced in accordance with the South African Code for the Reporting of Exploration Results, Mineral Resources and Mineral Reserves ("SAMREC"). It should be noted that the mineral resources are reported inclusive of the mineral reserves.
In South Africa, Harmony employs an ore reserve manager at each of its operations who takes responsibility as competent person for the compilation and reporting of mineral resources and mineral reserves at their operations. In Papua New Guinea, competent persons are appointed for the mineral resources and mineral reserves for specific projects and operations.
The mineral resources and mineral reserves in this report are based on information compiled by the following competent persons:
Mineral resources and mineral reserves of South Africa:
Jaco Boshoff, BSc (Hons), MSc, MBA, Pr.Sci.Nat, MSAIMM, MGSSA, who has 25 years’ relevant experience and is registered with the South African Council for Natural Scientific Professions ("SACNASP"), a member of the South African Institute of Mining and Metallurgy ("SAIMM") and a member of the Geological Society of South Africa ("GSSA").
Mr Boshoff is Harmony's Lead Competent Person.
|
|
|
|
|
|
|
|
Jaco Boshoff
|
|
|
Physical address:
|
Postal address:
|
Randfontein Office Park
Corner of Main Reef Road and Ward Avenue
Randfontein
South Africa
|
PO Box 2
Randfontein
1760
South Africa
|
Mineral resources and mineral reserves of Papua New Guinea:
Gregory Job, BSc, MSc, who has 31 years’ relevant experience and is a member of the Australian Institute of Mining and Metallurgy (AusIMM).
|
|
|
|
|
|
|
|
Greg Job
|
|
|
Physical address:
|
Postal address:
|
Level 2, 189 Coronation Drive
Milton, Queensland
4064
Australia
|
PO Box 1562
Milton, Queensland
4064
Australia
|
Both these competent persons, who are full-time employees of Harmony, consent to the inclusion in the report of the matters based on the information in the form and context in which it appears.
DIRECTORATE AND ADMINISTRATION
|
|
|
|
|
HARMONY GOLD MINING COMPANY LIMITED
|
|
Harmony Gold Mining Company Limited was incorporated and registered as a public company in South Africa on 25 August 1950
Registration number: 1950/038232/06
|
|
CORPORATE OFFICE
|
|
Randfontein Office Park
PO Box 2, Randfontein, 1760, South Africa
Corner Main Reef Road and Ward Avenue
Randfontein, 1759, South Africa
Telephone: +27 11 411 2000
Website: www.harmony.co.za
|
|
DIRECTORS
|
|
Dr PT Motsepe* (chairman), JM Motloba* (deputy chairman), M Msimang*^ (lead independent director), PW Steenkamp (chief executive officer), BP Lekubo (financial director), HE Mashego (executive director)
JA Chissano*^#, FFT De Buck*^, Dr DSS Lushaba*^, KT Nondumo*^, VP Pillay*^, GR Sibiya*^, JL Wetton*^, AJ Wilkens*, P Turner*^
* Non-executive
^ Independent
# Mozambican
|
|
INVESTOR RELATIONS
|
|
E-mail: HarmonyIR@harmony.co.za
Telephone: +27 11 411 2314 or +27 82 759 1775
Website: www.harmony.co.za
|
|
COMPANY SECRETARIAT
|
|
Telephone: +27 11 411 2359
E-mail: companysecretariat@harmony.co.za
|
|
TRANSFER SECRETARIES
|
|
JSE Investor Services (Proprietary) Limited
(Registration number 2000/007239/07)
19 Ameshoff Street, 13th Floor, Hollard House, Braamfontein
PO Box 4844, Johannesburg, 2000, South Africa
Telephone: +27 861 546 572
E-mail: info@jseinvestorservices.co.za
Fax: +27 86 674 4381
|
|
ADR* DEPOSITARY
|
|
Deutsche Bank Trust Company Americas
c/o American Stock Transfer and Trust Company
Operations Centre, 6201 15th Avenue, Brooklyn, NY 11219, United States
E-mail queries: db@astfinancial.com
Toll free (within the US): +1-886-249-2593
Int: +1 718 921 8137
Fax: +1 718 921 8334
*ADR: American Depositary Receipts
|
|
SPONSOR
|
|
JP Morgan Equities South Africa (Proprietary) Limited
1 Fricker Road, corner Hurlingham Road, Illovo, Johannesburg, 2196
Private Bag X9936, Sandton, 2146
Telephone: +27 11 507 0300
Fax: +27 11 507 0503
|
|
TRADING SYMBOLS
|
|
ISIN: ZAE 000015228
|