Harmony Gold reports double-digit HEPS

Harmony Gold, a major gold and copper producer, has seen its shares soar over 2% following the release of its first half results. The company's profits surged by 18%, driven by higher metal grades and prices. CEO Peter Steenkamp recently sat down with CNBC Africa to discuss the company's performance and future plans. One of the key highlights for Harmony Gold in the recent period was the acquisition of the EvoCopper mine in Queensland, Australia. The project, which is fully permitted, was acquired at the end of last year after a competitive bid process. Steenkamp expressed satisfaction with the purchase, stating that the company is currently focused on conducting a feasibility study to ensure that the project is viable for development in the long term. The study is expected to be completed by September this year, with a decision on the project's future anticipated by the end of the calendar year. When asked about the outlook for gold prices, Steenkamp acknowledged that the metal price has been relatively stable. He attributed this stability to the high interest rates in the United States and other parts of the world. However, he expressed optimism about the future performance of gold, especially if interest rates were to ease. As a South African operator, Harmony Gold is particularly sensitive to fluctuations in the Rand gold price and exchange rate, factors that also influence the company's performance. Despite facing inflationary pressures, particularly in the cost of consumables like diesel and reagents, Harmony Gold managed to contain its cost inflation to 6% year-on-year. Steenkamp credited the company's ability to maintain production levels and control costs by closing less profitable areas and focusing on high-grade operations. He emphasized the importance of cost control and maintaining the right grade to ensure profitability in the current environment of high inflation. In a strategic move, Harmony Gold chose not to pay a dividend in the recent half-year period. Steenkamp explained that the decision was driven by the company's focus on two major capital projects in South Africa - the Carrier Ant extension and the Zyplus deepening project. These projects, which require significant capital investment, are expected to generate strong returns for shareholders in the future. By reallocating funds to these growth initiatives, Harmony Gold aims to enhance long-term value for its investors. Overall, Harmony Gold's decision to invest in growth projects and forego dividend payments demonstrates the company's commitment to strategic expansion and value creation. With a solid financial performance in the first half and promising developments on the horizon, Harmony Gold is positioning itself for continued success in the gold and copper mining sector.