Harmony posts 80% jump in full-year operating profit

HARMONY Gold, South Africa's third-largest gold producer, on Thursday posted strong annual results despite a small drop in gold output during the 2012 financial year. "Year on year it was a great year for us," Harmony CEO Graham Briggs said. "Operating profits were 80% better than the previous year and that’s based on almost flat gold production," he said. "It was a good operating profit based on a gold price increase of 36%," he added.

Gold production slipped 2% to 1.275-million ounces for the year to the end of June 2012. Operating profit climbed 80% to R5.896bn. Headline earnings per share more than doubled to R5.51 from R2.23 before. Harmony declared a 50c dividend, taking the total dividend for the year to 90c. Harmony grew its cash to R1,77bn from R1,4bn during the year, and the company does not plan to raise capital ahead of a more detailed study of its Wafi-Golpu project in Papua New Guinea.

The results of a pre-feasibility study into establishing a mine at the copper and gold deposit at Wafi will be released on at an investors’ day on August 29 and this will give costing estimates and timelines. "The expenditure at Wafi over the next few years is affordable on our current plans," Mr Briggs said.

Our capital including exploration is likely to go up in the forthcoming years, but so is our profitability. Raising money is not on our cards at all for the next couple of years," he said. Harmony bumped up its exploration spend during the 2012 financial year to R500m from R324m in the previous year. The bulk of the exploration expenditure was in Papua New Guinea, where Harmony shares two major projects with Australia’s Newcrest Mining and where it has a number of wholly-owned exploration projects.

Mr Briggs has said in the past that Harmony is looking to reduce its high exposure to South Africa. It is the most exposed of the major gold miners to South Africa.

Source: Business Day

Nigeria: 400 More Children Killed by Lead Poisoning

Lead poisoning linked with illegal gold mining has killed a further 400 children in northern Nigeria since November, the National Emergency Management Agency said Monday. The latest figures suggest that the death toll from the crisis in the northern state of Zamfara is rising after the United Nations said lead poisoning in the region had killed at least 400 children between March and October last year.

Source: New York Times

South Africa: 36 Illegal Miners Die

An underground fire in an abandoned shaft has apparently killed 36 people who were illegally mining, the Harmony Gold Mining Company said Monday. The company said the bodies were brought to the surface by other illegal miners over the weekend at the Eland shaft in central South Africa. In a statement, the company said that it was unclear if other illegal miners had died and that it would not send its own workers in to search, because “the abandoned mining areas where the criminal miners have been active are extremely dangerous.”

Source: New York Times

The Restriction of Political Space in the Democratic Republic of Congo

This 96-page report documents the Kabila government's use of violence and intimidation to eliminate political opponents. Human Rights Watch found that Kabila himself set the tone and direction by giving orders to "crush" or "neutralize" the "enemies of democracy," implying it was acceptable to use unlawful force against them.

Source: Human Rights Watch

The Curse of Gold

This 159-page report documents how local armed groups fighting for the control of gold mines and trading routes have committed war crimes and crimes against humanity using the profits from gold to fund their activities and buy weapons. The report provides details of how a leading gold mining company, AngloGold Ashanti, part of the international mining conglomerate Anglo American, developed links with one murderous armed group, the Nationalist and Integrationist Front (FNI), helping them to access the gold-rich mining site around the town of Mongbwalu in the northeastern Ituri district.

Source: Human Rights Watch

Mbeki makes crime his first priority

President Thabo Mbeki put crime at the top of his priority list on Friday, announcing an overhaul of the South African Police Service and a range of other measures aimed at improving the criminal justice system. In his state of the nation address to a joint sitting of the National Assembly and National Council of Provinces (NCOP), Mbeki said one of his government's main tasks would be to transform South Africa into "a winning nation" with the opportunity of "a better life for all". But "the impermissible level of crime and violence" was standing in the way of a better South Africa, he said. The government alone could not stem the tide of crime, Mbeki said.What was needed was "a mobilisation of the whole nation into united people's action, into partnership with the government for progressive change and a better life for all".

Mbeki's plans include the recruitment of "new recruits with the requisite levels of education" into the police, and a new human resources strategy to "fast track" these recruits into management levels. He also announced that a new multi-departmental unit would be established to deal with all national priority crimes, including corruption in the police. Legislation against money-laundering was in the pipeline, as well as new laws to "deal mercilessly with all crimes involving guns, including the illegal possession of firearms, killing of police officers, corruption in the criminal justice system and intimidation of witnesses".

Another inititative is the establishment of "special commercial crime courts" to deal with white-collar crime. Mbeki committed his presidency to "honest, transparent and accountable government" and said he was "determined to act against anybody who transgresses these norms". He said the growth, employment and redistribution programme (Gear) and the reconstruction and development programme would remain the cornerstones of economic policy, and promised a range of measures to deal with unemployment.

Mbeki said the government would continue discussions with all role players about issues affecting the job market, including labour legislation, in an effort to create the best conditions fro job creation. The government would remain committed to fiscal discipline, and continue its programme of restructuring state assets, Mbeki said. To promote badly-needed foreign investment, an International Investment Council would be established which will include "some of the leading players in the global economy" to make South Africa an attractive destination for investors.

Internationally, South Africa intended taking a more active role in regional conflict resolution. "We cannot accept that war (and) violent conflict are a permanent condition of existence for us as Africans... We will therefore contribute whatever we can towards the resolution of conflicts on our continent." Mbeki said the government was "preoccupied" with the issue of gold sales by central banks and and promised to maintain contact with all role players in an attempt to minimise the impact of gold sales on the local economy.

Source: IoL