Moab acquisition boosts Harmony. The gold producer reported a sharp rise in first-quarter production from a year earlier, helped by its Moab Khotsong and Hidden Valley mines.

Harmony Gold Mining has had a strong first quarter thanks to rising output from Hidden Valley and the inclusion of Moab Khotsong.

The group grew production by 30% in the three months to end-September from a year earlier. However, it was 2% lower than the previous quarter, while all-in sustaining unit costs rose 8% to $1 166 an ounce. It said the increase in operating costs was due to the seasonal higher winter electricity tariffs and higher labour costs, including once-off leave liability adjustments following a wage settlement agreement last month.

Hidden Valley, in Papua New Guinea, generated free cash flow for the first time since achieving commercial levels of production in June. Recovered grade and gold production are expected to improve for the remainder of its financial year as mining into the deeper and higher grade areas of the ore body progresses.

South African production rose 19% from a year earlier, mainly due to the addition of gold produced by Moab Khogsong, which was bought from AngloGold Ashanti in March.

Hidden Valley and Moab Khotsong have boosted the group's production and free cash flow generation compared to the September 2017 quarter," CEO Peter Steenkamp said. "We are confident that we will achieve our annual production and cost guidance as we continue to focus on safety, production and cost management."

Harmony said it took advantage of the weaker rand over the quarter to top up its hedging programme.

Its shares fell 3.1% go R25.31 yesterday.