Harmony Gold's [JSE:HAR] share price slumped 3% following the release of its operational update.
On Thursday, the gold mining company’s share price opened at R24.11 and was trading at R23.54 ahead of the release of its operational update at 11:13.
By 11:20 the share price was at R23.60, before slumping 3% to a low of R23.07. By 12:20 the share was trading just more than 5% weaker at R23.20.
According to the update, for the nine-month period ended March 31, 2019, gold production increased 29% to 33 673kg, mainly due to the acquisition of Moab Khotsong which came into effect on March 1, 2018. There was also increased production from Hidden Valley.
However, the gold price remained flat in rand per kilogram terms, Harmony Gold noted. The gold price was R579 778/kg for the nine months compared to R572 513/kg, compared to the same period, last year. In US dollar terms, the gold price decreased 7%.
The update also showed that cash operating costs increased in rand terms by 2% to R438 452/kg. In US dollar terms it decreased 7%.
Harmony Gold said that the performance in the most recent quarter ending in March was influenced by a slower start-up following the December holiday period.
Stage 4 load shedding
Eskom Stage 4 load shedding also impacted the mining company's performance.
"The Eskom Stage 4 load shedding at the end of the March 2019 quarter, mainly had an impact on production from surface operations.
"Ore milling and hoisting scheduling arrangements implemented to reduce electricity consumption impacted the continuity of ore processing during the quarter," the update read.
The mining company assured it remains on track to deliver on annual production guidance.
Harmony is on track to deliver on annual production guidance. The company is targeting gold production of 1.45 million ounces for the 2019 financial year. Cost guidance has been updated to an all-in sustaining cost of R540 000/kg, taking into account Eskom's electricity price increased. The previous guidance was expected costs to range between R520 000/kg and R530 000/kg.