David Leffel's questions to HARMONY GOLD MINING CO (HMY) leadership • Q4 2016
Question
David Leffel of Deutsche Bank inquired about the status of asset disposals, their potential impact on production guidance, and the operational future of the Hidden Valley and Kusasalethu mines, including costs and production volumes. He also questioned Harmony's core competencies for pursuing international acquisitions outside of its current footprint.
Answer
CEO Peter Steenkamp clarified that only Hidden Valley was for sale but was withdrawn after receiving no suitable offers; a study on the costs for its cutbacks is underway. He corrected that Masimong and Unisel are being harvested to completion, not sold. For Kusasalethu, he outlined a five-year plan to mine its high-grade area, guiding for 140,000 ounces in the next year at an all-in sustaining cost of approximately $1,170 per ounce. Steenkamp justified the M&A strategy as necessary to build the financial strength required to develop the major Golpu project.