adminwill resolve the risk to the operation, the company has commenced with a process, compliant with the Labour Relations Act, with the placement of the mine on care and maintenance and possible retrenchments.
Graham Briggs, chief executive officer of Harmony said the company wished to engage all stakeholders in order to reach an agreement that will bind all employees of the mine and that will provide management with sufficient assurances that there will be a return to normal, safe operations and production at Kusasalethu.
“We wish to seek a sustainable and lasting solution that would ensure that the security, safety and health situation at the mine is normalised and compliant with all applicable laws and the policies and procedure of the mine.
“We also wish to gain assurances from all stakeholders that the mine will be operated in a manner which would allow it to become viable and reach its projected profitability which would in turn ensure the future viability of the mine.
“It is important for investors to note that as a result of our decision for the time being to keep Kusasalethu non-operational after the Christmas break mainly for security and safety reasons, we have excluded its production for the balance of the financial year and anticipate that Harmony as a group will only produce 1,2 million ounces, rather than the 1,3 million ounces guided before,” Briggs said.
During the December 2012 quarter Kusasalethu experienced an unprotected strike, numerous other incidents of illegal industrial action, violence, sit-ins, vandalism of mine property and other labour disruptions.
As a result, the December 2012 quarter results for Kusasalethu indicate a cash operating loss of R150 million and a negative cash flow of R252million.
The negative turn is due to the mine achieving only 22 percent of its planned gold production in terms of its business plan.
Briggs was confident Harmony would rescue the mine in the next couple of months, provided it can be run safely and return to being cash flow positive. — CAJ News.
Online Reporter