Harmony says costs not falling fast enough
Harmony Gold Mining Co.'s Chief Executive Officer Graham Briggs said a fall in fuel and steel costs in the wake of the financial crisis had not had a dramatic impact on its bottom line.
Posted: Monday , 09 Mar 2009
JOHANNESBURG (Reuters) -
mineweb.com
Harmony Gold Mining Co.'s <HARJ.J> Chief Executive Officer Graham Briggs said a fall in fuel and steel costs in the wake of the financial crisis had not had a dramatic impact on its bottom line.
Briggs, who was speaking at the Reuters Global Mining and Steel Summit via teleconference from Johannesburg, said the costs had not been coming down as expected, and it had been quite a lot of hard work to get much benefit.
"There has been a little bit of movement, but it really doesn't affect the bottom line dramatically. So although steel prices and some other costs have come down, they have not come down to the extent we were hoping," he said.
"But they are not going up as they were before which is the good news," Briggs added.
Analysts have said with gold prices nudging their all-time high and lower fuel, raw materials and equipment costs tumbling, mining company profit margins are expected to be widening, making gold company shares attractive.
"If we are looking at the total cost line, it should be probably the same as last quarter or probably a little lower but it has not increased," Briggs said. (For summit blog: blogs.reuters.com (Reporting by James Macharia; Editing by Hans Peters) |
