Harmony Gold Mining Eyes Copper Growth After Record FY2026 Results

Key Points

• Record fiscal 2026 results: Harmony met gold production guidance for the 11th consecutive year, producing 1.43 million ounces of gold and 18,200 tonnes of copper. Higher gold prices helped expand its all-in sustaining cost margin to 42%, while headline EPS doubled and total dividends reached about $500 million.
• Fiscal 2027 will be an investment year: Harmony plans to direct capital toward sustaining operations, brownfield mine-life extensions and the Eva Copper project, with total planned spending of approximately $1.59 billion to $1.72 billion, subject to environmental approvals.
• Copper is the main growth driver: CSA production is targeted to reach 40,000 tonnes by fiscal 2029, while Eva Copper is expected to begin production by the end of calendar 2028 and produce about 60,000 tonnes of copper and 19,000 ounces of gold annually.

Harmony Gold Mining NYSE: HMY said its fiscal 2026 performance reflected continued operational consistency, higher gold prices and progress in expanding its copper portfolio, while outlining fiscal 2027 as a year of increased investment in sustaining operations, reserve conversion and the Eva Copper project.

During the presentation, the company said it met its gold production guidance for the 11th consecutive year, producing 1.43 million ounces of gold and 18,200 tonnes of copper, both at the upper end of its guidance ranges. Gold all-in sustaining costs were just below $2,200 per ounce, while copper C1 costs were $2.47 per pound.

Harmony reported its lowest-ever lost-time injury frequency rate of 5.05, though it said its ultimate objective remains zero harm. The company also cited a 100% increase in headline earnings per share to 258 South African cents and declared a record final dividend of 47 cents per share. Total dividends for the financial year were about $500 million.

Margins Expanded as Gold Prices Rose

The company said its average realized gold price increased 46% to $3,800 per ounce in fiscal 2026. U.S.-dollar-denominated all-in sustaining costs rose 22% to approximately $2,200 per ounce, partly reflecting a 7% strengthening of the South African rand to ZAR16.89 per U.S. dollar. In local-currency terms, all-in sustaining costs increased 13%, Harmony said.

Despite the higher cost base, Harmony said its all-in sustaining cost margin expanded to 42% from 31% in the prior year. Underlying cost growth, excluding eight months of production from the CSA copper mine and royalties, was 7%, below the company’s planned mining inflation rate of 10%.

Labor remains Harmony’s largest cost component, and the company said labor relations in South Africa remain strong, with two years left under its current five-year wage agreement. It also said diesel represents only 1% of total costs, while royalties increased to about 7% of costs because of stronger profitability.

Capital Allocation Focuses on Base Business and Growth

Harmony described fiscal 2027 as a deliberate investment year. It plans to allocate about 20% of capital spending toward sustaining operations and protecting its production base, 40% toward brownfield projects intended to improve portfolio quality and extend mine lives, and the remaining 40% toward the greenfield Eva Copper project.

The company said it has converted about 10 million additional ounces of mineral resources into mineral reserves at Mponeng, Moab Khotsong, Tshepong North and Doornkop at an average cost of $180 per ounce. Harmony said the projects have estimated net present values ranging from $400 million to $2.4 billion and internal rates of return of 30% to 65%, based on a gold price assumption of roughly $3,400 per ounce.

Gold mineral reserves increased to 27.4 million ounces, while gold resources were stable at 107 million ounces. Copper resources rose 18.5% to 7.4 million tonnes, and copper reserves increased 71% to 4 million tonnes, driven primarily by Eva Copper and CSA.

Copper Assets Expected to Drive Future Growth

At the CSA copper mine, Harmony said it is targeting production growth from about 30,000 tonnes in fiscal 2027 to 34,000 tonnes in fiscal 2028 and 40,000 tonnes by fiscal 2029. The company said work is continuing on its capital ventilation project, with the first ventilation rise completed, while a record 560 meters of development was achieved during June 2026.

Harmony said drilling at CSA has returned intercepts of up to 12% copper outside the existing mineral resource, including a potential extension more than 500 meters below the current mine. Nearly 12,000 meters were drilled during the fourth quarter, it said.

At Eva Copper, pre-mining has begun in the approved Little Eva area and processing plant construction is moving toward peak activity in calendar 2027. The project’s capital guidance remains unchanged at $1.55 billion to $1.75 billion, and first production remains targeted for the end of calendar 2028, subject to environmental approvals related to a protected species found at the site.

Eva is expected to produce about 60,000 tonnes of copper and 19,000 ounces of gold annually over a minimum 15-year mine life, according to Harmony.

Fiscal 2027 Guidance

• Gold production of 1.3 million to 1.4 million ounces, with underground recovered grade of about 5.6 grams per tonne.
• Gold all-in sustaining costs of ZAR1.3 million to ZAR1.395 million per kilogram, equivalent to about $2,300 to $2,465 per ounce depending on exchange rates.
• CSA copper production of 28,000 to 30,000 tonnes, with recovered grade above 3.5% copper and C1 costs of $2.55 to $2.65 per pound.
• Planned capital expenditures of about $820 million for gold operations, $120 million for CSA, and $650 million to $780 million for Eva Copper, subject to Eva’s environmental approvals.

Harmony said it expects Australasia to account for about 30% of group production over the next decade, moving the company toward an approximately 70/30 regional production split. The outlook excludes the Wafi-Golpu project, which remains in permitting, and a potential mine-life extension at Hidden Valley, where studies are ongoing.

About Harmony Gold Mining (NYSE:HMY)

Harmony Gold Mining Company Limited is a South African gold producer headquartered in Randfontein, South Africa. The company explores for, extracts, and processes gold from underground and surface operations, producing doré bars and gold concentrate for sale to refiners. Harmony is listed on the Johannesburg Stock Exchange and its American depositary shares trade on the New York Stock Exchange under the symbol HMY.

Harmony's operations are primarily located in South Africa, where its assets include the Mponeng, Doornkop, Kusasalethu, and Tshepong operations, as well as surface retreatment and tailings-processing businesses.

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