South Africa's Harmony Gold first-half profit soars; reinstates dividend

JOHANNESBURG (Reuters) - South Africa’s Harmony Gold Mining Co Ltd posted a more than three-fold surge in interim first-half profit on Tuesday, boosted by higher gold prices, increased output and the inclusion of the Mponeng mine into its portfolio.

The sun sets behind a shaft outside the mining town of Carletonville, west of Johannesburg, file. REUTERS/Siphiwe Sibeko

The Johannesburg-listed miner also declared an interim dividend of 110 cents, reinstating it for the first time since 2017.

Higher bullion prices helped cushion the impact of the COVID-19 pandemic for miners, with Harmony seeing a 31% surge in average gold prices during the six month period to Dec. 31.

“The exceptional performance achieved in the first half of FY21 substantiates the growth strategy that we set out to pursue at the beginning of 2016. Through astute acquisitions, we have successfully added quality ounces to our portfolio and de-risked our asset portfolio,” Chief Executive Officer Peter Steenkamp said.

Harmony reported headline earnings per share of 775 cents, compared with 249 cents a year earlier.

Revenue for the half-year rose 39% to 21.6 billion rand ($1.48 billion) from 15.5 billion rand a year earlier.

The miner, which has operations in Papua New Guinea too, said gold output during the six months rose 8% higher to 745,347 ounces, compared with 688,379 ounces a year earlier due to the inclusion of the Mponeng mine into its portfolio.

Harmony assumed full ownership of Mponeng- the world’s deepest mine - from rival AngloGold Ashanti in October.

The acquisition also boosted Harmony’s mining grade and cash flow, the company said.

Harmony said it recorded one-time gain of 1.153 billion rand on bargain purchase from the acquisition of the Mponeng operations and related assets.

($1 = 14.6167 rand)

Reporting by Tanisha Heiberg; Editing by Kim Coghill and Rashmi Aich