Good morning, everybody, and welcome to the results of the first half of FY '20. Special word of welcome also to four of our nonexecutive directors, Andre Wilkens, Given Sibiya, Fikile De Buck and Grathel Motau. Thank you very much for joining us this morning. It's really appreciated that you're here.I think today is also quite a landmark in the history of gold mining in South Africa because it will be the last results presentation of Frank Abbott as our Director. Now he's actually -- since 2020 -- or '97, it was 23 years that he's been the financial director on and off. He's been [indiscernible] and back again. And then also a little bit of a retirement for 6 months and come back again. This time around, we think he's still going to stay with us and still work as an executive director in charge of business development for the foreseeable future.Frank said to me the first results presentation, they made ZAR 40 million in Harmony at that time, and it was a very, very good result at the time. So much so that President Mandela called him and asked for ZAR 5 million to build a school. So that was the results presentation at the time in September '97. That was the first one.We also would like to then to welcome Boipelo. I think she's well-known to everybody. Boipelo will take over from Frank from the 3rd of March, and Boipelo, welcome -- yes, we all welcome -- you've been part of the team for quite a while, but welcome as the Financial Director of Harmony.So let's start with the presentation. Just take note of our safe harbor statement, please.Just in terms of safety. Let's start with our safety. We are pleased to say that we've actually had…

Thank you, Peter. This is the extract from our income statement. And this is for the 6 months ending December 2019 compared to the 6 months ending December 2018. We start off there with the revenue. You can see our revenue is up to ZAR 15 billion. This is 11% higher than we had previously. The increase was due to a 19% increase in the gold price, and that was unfortunately offset by 8% reduction in gold production.Our cash operating costs went up by 8%. As Peter said, this is the normal inflationary increases on both wages and on the electricity. Production profit went up by 21% to ZAR 4.1 billion. Amort was slightly lower because of lower production in this period. Exploration expenditure went up by ZAR 50 million, and this was just the result of the expanding expenditure at Wafi-Golpu in this period, in the 6 months. We had a gain on our foreign exchange. This is on our dollar debt. In this period, we paid tax on our foreign exchange gains. And then our net profit was up to ZAR 1.3 billion from a loss of ZAR 19 million in the period year before. This is our U.S. dollar.If we look at our net debt reconciliation. There, we had the ZAR 4.9 billion, at the beginning of the 6-month period at the end of June. We generated cash of ZAR 3.1 billion. We spent capital in South Africa of ZAR 1.5 billion. ZAR 700 million at Hidden Valley. And then there was some other expenses. That takes us to our net debt position at the end of the year where we paid off ZAR 630 million of our net debt. This is just in dollar terms.I hand back to Peter.

Our second half focus areas going forward. Our strategy remains to produce safe, profitable ounces and increasing our margins. We have 4 strategic pillars.The first one is operational excellence. Our key focus remains to improve our safety performance and increase our productivity by doing that. And we really spent an enormous amount of time and effort to improve our safety. I mean, most of the time that both Beyers, the Chief Operating Officer; and myself is spending is really on safety issues and trying to improve and really mobilize the whole operations in terms -- as far as safety is concerned. We revised our guidance due to the lower grade. And this morning, we had some feedback from some of our analysts that say, "Why do you actually adjust it for such a small margin?" But we do believe that we need to be transparent. And so we dropped the production with 4% to 1.4 million ounces. And really on the back of the underground grade that we see now between 5.50 and 5.57. That's in line with last year's performance as far as grade is concerned from the underground operations in South Africa. And our all-in sustaining costs on the back of that will now be between ZAR 600 and ZAR 610 a kilogram.From a cash certainty perspective, we'll focus on repaying our debt and hedge to manage our short-term volatility. And I think we've been quite good at that over the years. It's proven to be -- we're really making good lot -- a lot of money because of that. And the hedges that we do going forward isn't expecting a very, very high price.The third pillar is really effective capital allocation. And here, we have secured Wafi-Golpu permitting. And we -- this morning, we had some very…

Okay. I'll start with Mponeng. I think everybody is going to ask me questions on Mponeng. So I'll answer it once. We continuously said that we will look at opportunities, both in South Africa, Papua New Guinea, rest of Africa. And if it makes sense for us to invest, we will do in those opportunities. Obviously, they need to be affordable, too. So where we are with -- we consider with that. We don't want to specifically talk about any specific opportunity until we get to a point that we have some real clarity or real certainty about that. So that's where I'm going to stop with Mponeng. I'm not going to answer any more questions about Mponeng.Target North is quite exciting. We've drilled the first hole. We started that about 7, 8 months ago now, Jaco. We obviously want to firm up on our view of what the VCR is. That the -- first, VCR is on top of the [indiscernible] or the Elsburgs in the massive mining. And we intersected reef just the end of December. About a week from now, we will have the grades of the first intersections. And obviously, we're drilling other deflections now. So when we get that information, we will make it available to probably the next results presentations and see where we are and what we have. But so far, it looks pretty exciting. Obviously, we are a gold miner, so we are optimistic. So it is very exciting stuff. But it is like a mine that is -- that if ever it is worth something, it is very far in the future. But we're confident that we have something there.

Just couple of questions from me. It's Shilan from UBS. Peter, just more of a long-term type of question. How are you thinking about your portfolio? You have quite a few assets that have less than five years left, a couple of assets that have 1 year left. So how are you thinking about those assets? And then secondly, what's the impact of load shedding on your operations? What was the impact in the last two -- say, last quarter? And then what do you think is the impact going forward? What's your mitigating strategy for that?

Good terms. Thanks. First of all, in terms of what we have is that if we look at 2016, where we had, we had about a 5-year life ahead of us, at a specific -- I think it was about 1 million ounces. Where we are today? We've got 1.4 million ounces, and it is probably another 5 years or 6 years. So we've managed to absorb 4 years and still have the 5 years ahead of us. We have a lot of organic opportunities. We've got a lot of retreatment facilities. It is also about getting our -- Kalgold is quite an advanced stage in terms of having a bigger mine at Kalgold. We're trying to find just the ore body to support that. Drilling a lot of work -- doing a lot of drilling work at the mine. And obviously, through mergers and acquisition, the add of Moab Khotsong. That will, obviously, get us there. So we are quite confident that we will be able to extend it another 5 years or so. So it will be a 10-year life or so going forward.Having said that, on the Eskom side, obviously, the Stage 6 didn't help us a lot in the end of the year. We had -- the impact was a full shift and 2 night shifts that we couldn't shut down. That is about 80 to 90 kilograms of gold that we lost due to that because we had to keep people on service during Stage 6. But the issue was really about the momentum break that we had because we were really having a good momentum after the Christmas break. And normally, people work really hard after the Christmas break to ensure that they have a good bonus and anything else. But then you sit…

It's Arnold Van Graan from Nedbank. Peter, continuing on the theme of electricity. So obviously, the minister has opened up the path for IPP and self-generation. So what projects do you have? What are your plans regarding that? And how will that be funded? Is it possible to fund this externally? Or will you take it on to your balance sheet?

Good. Thanks, Arnold. What we have in that -- I think it's 700-and-something megawatt that is on table. What the mining industry had on the table of the minister was 30-megawatt solar plant in the Free State. We're very thankful for the minister to give us a go to continue. We believe that all the regulation hurdles will be probably overcome in a month or 2 from now so we can start with the program. We already had -- went out on provisional tenders to build it. And what we're looking for is really somebody that will take-or-pay that we will not build with our own capital. There will be somebody else that will build it for us. So that's [indiscernible]. We have on the table, on the cards now, we say, another 40 megawatt that we can do in the future. But we obviously would like to see what -- get the maximum out of our being more self-sufficient as far as electricity is concerned. But the 30 megawatt was already in that list of ones that -- it was on the table of the minister for approval. So that will be our first step. So all things being equal, by the end of or middle of next year, we should be in a position that we can -- and that was about 30% of our production at -- of 10% of our production -- usage at the time when we made the application. Obviously, Moab now is bigger. So we certainly would like to increase our self-sustainability as far as electricity is concerned. At the moment, that particular one, it is on a -- we will just take -- somebody else will build it for us.

And then another one, if I may. You talk about productivity improvements as one of your key objectives. Can you just elaborate on that? What -- where are the opportunities? Where do they lie? What exactly does it entail?

Yes. We do quite a lot of work on business improvement. And certainly, some of them needs a bit of capital in terms of how you need to do that. But certainly, in things like getting people quicker to the face by using alternative transport measures, like for instance, chairlifts, horizontal chairlifts and things like that, so we're looking at -- all of things that we're currently looking at, every mine has got it's own list of issues that we believe that's bottlenecking that particular mine, being it ventilation, being it transport of people into the place, being it hoisting capacity. Mines like Phakisa is actually quite full as far as working capacity is concerned. So -- but we find that every one of those mines has got like a business improvement plan, which we would love to see quite a good result out of that going forward. Obviously, from a technology perspective, we're also looking at whatever we do for the Mandela [pleasing] that we've done through that process. We are also looking at trying to improve. But I mean, we've got a specific plan for every mine to improve.

Peter, it's me, again. Just a question around the use of the cash. So you gave us the sensitivity of your operations, your cash-generating sensitivity to the gold price. What are you going to do with the cash? Are you going to reinstate the dividends? What are the options that you're looking at?

Frank, would you maybe care to answer that?

During the last few years, [indiscernible] capitalizing of Hidden Valley and also with the acquisition of Moab. And so we've been through [indiscernible], and our first objective is to reduce our internals. And at this gold price, we will be able to do that. And of course, in the long term, our intention is to pay a dividend. But at this stage, we first want to reduce our debt. And it also helps us in possible future funding.

So deleveraging, then potential investments and then dividends? Or what's the order of preference?

I mean, the first thing is deleveraging. And then, of course, if there are opportunity for a full growth, we would consider that. And only lastly, we would look at the dividend at this stage. Yes.

Okay. So could I consider a dividend more of a long-dated type of option for us?

Yes.

Dominic O'Kane from JPMorgan. Just a question on Wafi-Golpu. It seems like there are delays in your permits. Can you give us a little bit of color on that?

Yes. Like I said previously, we thought we had a huge breakthrough at the end of December 2018, when we signed the MoU with the government. Because it really gave us a lot of -- actually, all the conditions were met. And we had everything in place to actually take the project forward. Unfortunately, we had, like I said, we had a change of guard in terms of the Prime Minister was changed. The new prime minister was wary of the previous Prime Minister's agreements that he made. And then we had this stay order from the governor that he actually got -- went to court and said he was not consultant -- consulted and he would like to -- he want to be part of this transaction. According to the Papua New Guinea law, you don't necessarily have to consult the provincial governor in this transaction. But in any case, be it as it may, we had the stay order, so we couldn't progress anything as far as the permitting is concerned. So we couldn't have any meetings with the governor or government and the government team. And that took about a year to resolve.Now it's been lifted and the court case was thrown out. So we can now continue with that. So we -- I spoke to Johannes this morning, and he's keen that next week, we start with discussions in terms of how we're going to take it forward with the government and so forth. There's some -- we've got -- at least what we say is we had a huge amount of urgency from the government to actually permit this transaction now. I think the government is under pressure to deliver some of the projects in Papua New Guinea. So we will wait and see, but we think we're going to have good traction going forward. And we're confident that it will be a good way for us going forward.

Okay. Peter, I think we've got some questions from the webcast. I'm going to start with the first one. Frank, I think this is directed at you. This is from Peter [indiscernible]. And he asked, "At what point does Harmony expect to be debt free? And will it leverage its balance sheet for future acquisitions?"

Yes. Thank you. If I could answer on that. When will we be debt free? Of course, that would depend on the gold production and the gold price. If the gold price stays where it is now, it would be actually by the end of next year at this production. And will we leverage it for future acquisitions? Yes, we will. We have been doing it, and we will continue to do that. Thank you.

Peter, and I got a question here from [indiscernible]. This is a question regarding our infrastructure and our engineering at our SA assets. I'll term it as a misconception that we're sitting with aging machinery/infrastructure. And he wants to know if that's true.

Yes. No, we've -- obviously, we do have old infrastructure. But I think we've done a tremendous amount of work since 2016 to fix that. If you would recall, there would have been many, many unplanned stoppages on our operations due to infrastructure. We've had -- hardly had any of that in the late future. One of the areas that also had a big issue was Hidden Valley. I think Hidden Valley, in general, has been working very, very well. We've been -- we had hiccups from now and then with the power surges from PNG Power, but -- and we had to manage those. But other than that, our infrastructure is actually in very good nick. We've been -- good, planned maintenance and programs that our engineering team has put in place. I'm very proud of the work they've done. They can actually go and tell Eskom how to do it, also using old, aging infrastructure and fix them up to a process where they can really work well for you, and you can respect them.[Indiscernible] our infrastructure is not under a huge amount of pressure. Most of the mines that we operate were much bigger mines in the past. So what we have now is that we do have time to work on infrastructure and have time to make sure that we have proper plant maintenance and conditioning monitoring, which is something that we introduced about 4 years ago. The conditioning monitoring is working very well for us on our key operations.

It's Marian from Harmony. I also want to remind our investors that with all of our IMIU audits over the last couple of years that's our insurers we've scored very highly on the infrastructure. So there's been definite improvement over the last 5 years.

Yes. It's amazing what the team has done over the time to improve. If you look at our orders from our insurers that we are now one of the companies where they really believe we have got good infrastructure in place.

Peter, I've got one more from Jared Hoover at RMB. And this is concerned with our -- with us readjusting our guidance. Previously, we were sitting at 1.5 million, which we've managed to achieve, but we've now downgraded to 1.4 million. And Slide 28 indicates that you're going to produce 1.5 million in FY '20. So he wants to find out what your assumptions are regarding this level of production over the next 1.5 years. And are there any brownfield projects factored into this guidance? And what do you consider [indiscernible] as replacement or upside to this target of 1.4 million?

Okay. So 1.4 million, I mean, if you -- when I look back when it was 1.5 million, we obviously had a full Unisel. We've stopped Unisel. We're just mining the shaft pillar now. So we're just in the final parts of extraction. Unisel will have another 6 months ahead of it, and then it will probably be finished. It will be tough to get the full 6 months out of that. But we don't believe that we will have any false infringement because of that because we planned for this quite a while ago. We'll move the people to other parts of our operations. And then Masimong, which is the other one that we said that have very short life, we managed to actually get some fairly good grades, and we believe that at least we have the full financial year, we will be able to mine Masimong. We're in the process now of replanning. And most probably, we'll have 18 months out of Masimong in total from where we are now. So that will be the outcome. Masimong had very good figures in the last 6 months.Going forward. I mean, the brownfield things that we have is, obviously, the increase in production from Joel. It will be increase in production from -- if we recapitalize Target, that will also be increase in production there. We are -- there is an increase in that we are mining deeper and deeper in Mponeng, Phakisa and Tshepong, where we get to the higher grades part of the ore body. So I think all in all, we will probably be -- South African or the current operations will operate for that 1.35 million, if you take Unisel out, going forward for quite sustainable future.

Thanks, Peter. Do you have any calls -- any questions from the call?

Yes, sir. We have a question from Adrian Hammond from Standard Bank.

Peter, a couple of questions, please. Could you give us some idea on when you intend on expanding Kalgold toward production? And what would the call on CapEx for that be? Secondly, on Golpu, what is the time frame for the expectation around receiving the SML? And [indiscernible] the call on CapEx be following that? And then given all these capital requirements, and I guess, with your intention around acquisitions, would you consider using your paper to fund all of this? And is there any lesson learned from your prior acquisition of Moab, given the -- with respect to the level of debt to equity you used there? And what's the sort of target net debt to EBITDA for Harmony Gold, please?

Okay. Adrian, first of all, on Kalgold. What we've done at Kalgold is that we did, if you recall, if you just take a step back in terms of where Kalgold was previously. They had little geological information about Kalgold in the past. What they did -- normally did was they just drilled enough to do the next year's plan, next 2 to 3 years' plan. And we changed that philosophy few years ago. And actually, we spent some money on understanding the ore body a lot better. So we did quite a lot of drilling. I think we spent close to ZAR 90 million in drilling Kalgold and understanding the ore body. So we did find quite a lot of exciting stuff there which can be able to take Kalgold to a much bigger mine. Now we are looking at -- we've done the pre-feasibility study of that. And we're taking quite a few options forward. One is just to take the current mine and just to find -- mining higher grades and see that -- that's a good outcome of that. The second of that will be to build maybe a new plant because the current plant is really at full capacity and it's also a very old plant and a very debilitated plant that building a modern plant could be to the benefit. That plant will probably cost to the region of about ZAR 1.5 billion, building it at over half or so to build it, if we do something like that. And then also to see if there's maybe a combination of the 2. Because what we did is we did this magnetic survey [indiscernible]. We did some soil sampling. Again, that was very promising. And we're looking at now drilling those areas to see. So we're quite -- a bit away from making a final decision as far as Kalgold is concerned.As far as Golpu is concerned, I don't have a time frame on that, Adrian. We'll see how things go. I mean, we just had this morning found out that the stay of discussions was lifted. So we will see how things go. So we'll keep you posted in terms of how -- what we think the time frame for Golpu will be going forward.Then on the SML -- to get to the SML. We know that both parties is very keen to get it.And Adrian, the last, final question? I didn't write them down.

The debt profile.

Yes. On the debt levels, yes.

Just whether you would use your paper to fund further growth? And did you -- do you have any lessons learned on the prior deal with Moab, given the level of debt to equity for funding that?

Yes. Thank you. If I can answer that. Yes, we -- at the time when we acquired Moab, our net debt-to-EBITDA ratio was 1.3. It's down to 0.7 today. So we are actually very happy with the way we did it. And we don't have a problem with our net debt situation. At these gold prices, we are very comfortable that we will be reducing our net debt in the next 18 months, 2 years significantly. When it comes to other acquisitions, I think the question, of course, would be what the size of the purchase price is. And we would very much like to fund it with a debt, and not with equity, if we can. Because we believe our share price is really undervalued. And to the extent we can fund it through debt, we will do that.

There are no further questions on the line, sir.

Okay. Thank you very much, Peter.

Thank you.

Ladies and gentlemen, thank you very much. If there's any further questions, especially from the media, please come see myself [indiscernible] Peter. And if any analysts have any questions, please go see Marian and Herman Perry, and they will answer all your questions. Thank you very much for coming.