Harmony Gold expects strong earnings growth as gold prices surge

South Africa’s largest gold mining company has signalled stronger financial performance for the second half of 2025, citing higher gold prices and solid operational fundamentals across its portfolio.

In a trading statement released through the stock exchange news service on Monday, Harmony Gold Mining Company announced that it expects a notable increase in earnings for the six months ending December 31.

The company indicated that its earnings per share in rands are expected to be between 21% and 30% higher than the previous comparable period. In dollar terms, earnings per share are forecast to increase between 23% and 30%. Headline earnings per share are expected to rise between 11% and 17% in rands and between 11% and 21% in dollars.

“Harmony’s underlying fundamentals remain strong, evident in the performance across our portfolio. Disciplined capital allocation allows us to convert higher gold prices into growth, while integrating copper scale from CSA and Eva Copper to widen margins and derisk cash flows through the cycle.

“We remain focused on selective, sequenced and affordable growth, alongside responsible shareholder returns. Mining with Purpose ensures we convert today’s opportunity into enduring long-term value for all,” Harmony Gold CEO Beyers Nel stated.

Gold price surge boosts revenue

Harmony Gold said the expected improvement in earnings is largely driven by a substantial increase in revenue following a sharp rise in the average gold price received.

The average gold price rose by 36% to R1 909 849 per kilogram in the last six months of 2025, compared with R1 405 020 per kilogram during the same period in the previous year. In dollar terms, the average gold price increased by 40% to $3 421 per ounce from $2 437 per ounce.

The company also reported a reversal of impairment related to property, plant and equipment associated with the Tshepong North cash generating unit. This adjustment followed higher gold price assumptions used in the valuation.

Additionally, Harmony benefited from an increase in foreign exchange translation gains. The company said this was mainly due to favourable exchange rate movements linked to the translation of its dollar denominated bridge facility into its functional currency.

Costs and acquisition expenses partially offset gains

Despite the strong revenue growth, several cost pressures and acquisition related expenses partially offset the increase in earnings.

Production costs rose due to above inflation electricity tariff increases and higher labour costs linked to the five-year wage agreement.

Royalty tax also increased as higher profit levels resulted in elevated royalty rates, while the expanded revenue base further contributed to the tax burden. Current taxation rose as well, reflecting improved profitability driven by favourable gold prices.

Harmony also recorded higher amortisation and depreciation costs following additions to property, plant and equipment related to the acquisition of MAC Copper.

The company further reported increased derivative losses, primarily due to a sharp rise in the silver spot price. The silver price moved above the average locked in floor and cap prices of the company’s outstanding silver collar contracts.

Other expenses included acquisition costs associated with the MAC Copper transaction, such as stamp duty payable in Australia as well as legal and advisory fees.

Finance costs also increased, mainly due to the bridge facility used to fund the MAC acquisition. These costs include the amortisation of commitment fees and a higher finance cost component linked to streaming arrangements that were assumed as part of the MAC Copper acquisition.

In addition, fair value movements on copper and silver streaming arrangements with OR Royalties contributed to the financial impact. These resulted from embedded derivatives that have been separated from host contracts and measured at fair value through profit or loss.

Harmony Gold is expected to publish its half year financial results on Wednesday, March 11.