This article first appeared on GuruFocus.

• Gold Revenue: Increased by 20% to ZAR44 billion.
• EBITDA: Rose 39% to ZAR18 billion.
• Operating Profit: Increased by 61% to ZAR16 billion.
• Net Profit: Increased by 24% to ZAR10 billion.
• Free Cash Flows: Strong generation, contributing to a 61% increase in operating profit.
• All-in Sustaining Costs: Rose to ZAR1.18 million per kilogram or USD2,115 per ounce.
• Interim Dividend: More than doubled to ZAR3.4 billion.
• Net Debt to EBITDA: At 0.18 times, well below the 1x threshold.
• Gold Production: 724,000 ounces for the reporting period.
• Dividend Policy: Revised to allow up to 50% of net free cash as a dividend.
• Cash and Undrawn Facilities: Around ZAR15 billion or USD900 million.
• Capital Expenditure: Total group capital expected to be ZAR18.5 billion for FY26.

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Release Date: March 11, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Harmony Gold Mining Co Ltd (NYSE:HMY) reported a significant increase in operating profit by 61%, reflecting strong financial performance.
• The company has revised its dividend policy to potentially return up to 50% of net free cash to shareholders, indicating confidence in cash flow generation.
• Harmony Gold Mining Co Ltd (NYSE:HMY) achieved an all-time low lost time injury frequency rate of 4.23, emphasizing its commitment to safety.
• The integration of CSA, Australia's highest-grade copper mine, is progressing well, with significant cost reductions since acquisition.
• The company is strategically investing in copper projects like Eva and CSA to diversify and enhance its portfolio, aiming for long-term growth and resilience.

Negative Points

• Harmony Gold Mining Co Ltd (NYSE:HMY) faced challenges with a cyanide shortage and lower plant recoveries, impacting gold production.
• The company's underground recovered grades decreased by 11% to 5.7 grams per tonne, affecting overall production efficiency.
• Group all-in sustaining costs rose to ZAR1.18 million per kilogram or USD2,115 per ounce, driven by lower volumes and higher royalties.
• The Hidden Valley production was disrupted by a tectonic-related mill motor failure and gold shipping delays.
• The development of the Upper Merrin mine has been paused, pending further drilling to improve orebody confidence, delaying potential production increases.

Q & A Highlights

Q: Could you address the impact of the cyanide shortage and lower recoverability issues? A: The cyanide shortage was a one-off issue due to a force majeure by our sole liquid cyanide supplier in South Africa. We have since normalized levels and are constructing a cyanide dissolution plant to mitigate future risks. The lower recoverability was due to variability in the plant process, but recoveries have now normalized.

Q: Can you elaborate on the new dividend policy and its implications if leverage exceeds 1x? A: The revised policy allows for up to 50% of net free cash to be returned to shareholders, subject to Board discretion and net debt to EBITDA levels. If leverage exceeds 1x, the Board will consider the situation at each reporting period to determine the appropriate dividend payout.

Q: What are the main constraints at the CSA mine, and what steps are being taken to address them? A: The main constraint at CSA is the ventilation circuit, which limits underground mining activities. We are working on establishing additional returns to improve ventilation. Other short-term issues include infrastructure maintenance, such as fixing shaft steelwork. We expect to optimize the mine over the next 18 to 24 months.

Q: How does the acquisition of CSA and Eva Copper impact Harmony's strategy regarding Wafi-Golpu? A: Wafi-Golpu remains a generational asset for Harmony. The focus is on obtaining the necessary permits to advance the project. The acquisition of CSA and Eva Copper strengthens our position and provides optionality, but Wafi-Golpu continues to be a priority due to its quality ore body.

Q: What is the expected production rate for CSA once optimization is complete? A: Currently, CSA is targeting 17,500 to 18,500 tonnes of copper for this financial year. The processing plant has a capacity of 1.8 million tonnes, and we aim to alleviate constraints to increase production. However, it will take time to achieve steady-state production.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.