Harmony Gold Mining Company Limited (HMY) Q4 2016 Earnings Report, Transcript and Summary

Good day, ladies and gentlemen, and welcome to the Harmony Gold Mining Company Ltd. operating and financial results for the six months and year ended June 30, 2016 question and answer session. [Operator Instructions] Please also note that this call is being recorded. I would now like to turn the conference over to the CEO, Mr. Peter Steenkamp. Please go ahead sir.

Good day, ladies and gentlemen. Welcome to our results discussion. Just before we start, I’ll just a little bit of highlights for the year for FY'16 year. First of all, we had a net profit of $64 million. We had a 1% reduction in net debt to $74 million. We had headline earnings per share of $0.15 per share. We’ve paid a dividend of $0.04 per share, we actually just on the back of very, very good grades and a production that we see improving. And then also we’ve, for the year, we also enhanced our copper and gold assets in Papua New Guinea by the exploration that we’ve done in the area. We are open for any questions from anybody from the floor.

[Operator Instructions] Sir, I don’t have any questions in the queue at the moment.

Chris, good day, ladies and gentlemen. Thank you very much for joining this call. As per our invitation, we are no longer doing the full presentation. We are relying on the webcast that was done this morning. Be that as it may, we will take you through a couple of slides which we believe is important just in terms of where the Company is heading and what we believe is important for you to know. And then we’ll continue with questions and answers. So I’m going to hand back to Peter.

Thank you, Marian. Maybe we can just elaborate a bit since there is no other further questions. Our FY'16 objectives we achieved. We have improved safety, increased our grades. We achieved our production guidance, increased our margins. We generated strong cash flows and repaid our debt. And we’ve got a very good growth story in copper resources in both Golpu and Kili Teke. Obviously, we had a share upliftment. On the safety side as from a lost-time injury perspective, we managed to crawl back where we were in FY'13. We really did quite well in this year. Unfortunately, we still had a high level of fatalities and we haven’t improved as far as that’s concerned. Certainly, it is a management focus going forward. Year on year, our South African production increased by 4%, so we are quite thankful for that. Our margins obviously we have, most of operations have fairly decent margins with the Bambanani, Tshepong and Phakisa being the stars in our portfolio. Unfortunately, for Kusasalethu and Hidden Valley, we didn’t make a profit for the year, and I think it’s one of the things we have to discuss is the Kusasalethu long-term future and also Hidden Valley. Our net debt decreased as we said with 61% to $74 million. Our Golpu -- and if you look at our gold and copper portfolio I think of note is that our resource -- we saw a growth in resources at Kili Teke which we 100% hold. It increased to 6 million ounces. But 30% of that is gold and 70% of that is copper. Harmony, since the start of this financial year, the FY'16 year, actually were the best performing share compared to all our peers, so we are quite happy. So what is our value upliftment? First of all, our increase in grade is obviously something we are really proud of because it’s fourth year in a row that we in actual fact increase our grade. It’s 54% or 61% in reduction of net debt, a profit of $64 million and I said the $0.15 of headline earnings and then of $0.04 of dividend that we’re paying. In this morning, we talked a lot about our objectives. The first thing is I think you -- what everybody needs to understand we are mining safe and profitable ounces, and we want to increase our margins. How are we going to get that right? First of all, by operational excellence, cash certainty and thirdly, efficient capital allocation. And our aim is to produce 1.5 million ounces at less than $950 per ounce over a three-year period, in the next -- at end of the next three years, to be in that position. And the reason why we want to do this is because we do have some of our operations that we are now harvesting. So we need to replace them and we need to make acquisitions to get us back to the level. We will not only be able to do it through organic growth or through exploration. We are operating in South Africa and we are operating in Papua New Guinea. What is of note in terms of our reserves is that the South African gold is now 45% of our reserves at 16.8 million ounces, of a total reserve of 37 million ounces. Copper now makes up 38% of our reserves at 13.9 million ounces. And then obviously Papua New Guinea in gold is 17% or 6.2 million ounces. This morning we had a lot of elaboration in terms of our grades in terms of why it is improving. And I think one of the things that we are very proud of is that the growth projects that Harmony worked on for quite a while is now actually delivering good results. The Phakisa, Tshepong decline is on track with their grades. The higher grades of Doornkop and Kusasalethu later that we started with a deepening, we continue with that. We are mining the Bambanani high grade shaft pillar. And then there’s also some upside as far as Joel is concerned, because we are completing, busy completing a decline which will deliver higher grades. And then we’ve got a lot of good grade discipline in place. No mining below cutoff, mining to average reserve grade and also focusing on quality. We also this morning talked a little about Phakisa in terms of the Phakisa it is really, really a good story for us. We had a very big increase in production and also increase in grade, delivering on this plan this consistent development -- development plans, so ensuring proper flexibility for the future. And there is also very good new technologies are being put out there, for instance, our ice plants is quite unique, ice plants are being installed there. And also, our rail-veyor that we transport -- our semi-automated horizontal ore transport system that we have between Phakisa and Nyala, a five-kilometer horizontal transport system. How are we going to get to the 1.5 million ounces per annum? First of all, we need to focus on our core business activities there’s nurture and develop, and grow some of those and harvest the other. We also look at new and emerging businesses and Tshepong and Phakisa integration is a very important one. Tailings re-treatment in the Free State, Golpu Stage 1 and also diversification into copper or other commodities. And then growth possibilities, we are looking at expansion in South Africa and also into Africa. Golpu Stage 2 is a growth possibility. Kili Teke prospect is a growth prospect. And then also the PNG grass roots exploration is a possibility in that area. On the nurture and grow, the operations that are really doing well and actually are creating a lot of momentum is Tshepong and Phakisa. Bambanani, we had not a very good quarter in the last quarter but in general we are doing very well and we are back on track as far as that’s concerned. Target 1 is a standalone mechanized operation with a large resource base. Joel, profitable, a low cost operation. Doornkop we are at the moment doing a lot of work to understand the ore body a little bit better in terms of where it is and also the grades that we have in place. And certainly it’s smaller margins but it is a, can be quite a decent operation. Phoenix, our tailings operations are doing very well. We obviously own only 70% of that tailings operation. And on tailings retreatment we approved a central plant capital to transform, or the potential to a tailings facility, retreatment facility of 300,000 tons per month. That process it will be done between the course of this year and probably will take us about a year to implement the changes and then we’ll be, have some more of the tailings retreatment. But we are also looking at a feasibility study of a standalone pretreatment plant in the Free State that can, that is a mega. We’ve done the studies as far as water is concerned because that’s obviously the biggest issue that we have is we have enough water. So we believe there is good potential to build a tailings retreatment facility, standalone retreatment facility in the Welkom area. That feasibility study should be finished by the end of this calendar year. And then Kalgold, also a low grade, open pit mine with a long life. Operations obviously that we want to harvest with the life cost shorter life is Masimong and Unisel, I think we’ve talked about that. I think the one that is now also on the cards there is Kusasalethu. We changed the life of mine from 20 on years to five years. We are really in a high grade area now, and we are mining the high grade area, we’ll mine it at a profit for the next five years. When we, in five years from now we’ll move back into fairly lower grades in Kusasalethu. And we are not sure if it’s feasible and we don’t think it’s feasible and our current plans doesn’t show it, to go back into the, to try and get the volumes up to be able to sustain a big operation like that. And for that reason, there is also a 13% reduction in our reserves year on year. Tshepong and Phakisa optimization is a very, very important operation for us. The integration studies actually aims at finding synergies between the two operations. Tshepong infrastructure is underutilized and Phakisa is fully utilized. We already hold two of the haulages with one, there is three to hold and we’ve got two of them already done. And we are also looking at really having extra volumes out of that, the combined unit. We could potentially mine one tonne of gold per month there. So that’s actually a very, very nice project going forward. Golpu, we are now at this point in time we are sitting in a situation where we have basically with our permitting phase. In a month from now, we will submit our applications. We were not successful in doing a pre-mine development agreement with the government. But I think we will obviously, the Special Mining Lease will flare up now to get that done. So we’ve put, major capital expenditure is postponed for another two years before we will actually start to spend some big money at Golpu. We are obviously getting to the 1.5 million ounces aspiration. We will not be able to do it just through organic growth. We’ll have to do some M&A. And what we are really looking for, our criteria for doing that is focusing on gold, looking at reserves between 1 million and 2 million ounces with more than 100,000 ounces per annum production. We are looking for operating mines, a life of mine longer than 10 years and then the all-in sustainable costs of less than $950 an ounce. And our focus area is really in South Africa, the rest of Africa and Papua New Guinea where we currently have a footprint, obviously not the rest of Africa but the other two areas. Driving down costs to below $950 per ounce is an important component of our long-term ambition. If you want to look at this year, our total cost and capital came from $1,203 per ounce to $978, which is a 19% improvement. Our capital expenditure is very much in line. We are not foreseeing a huge amount of uptick in the capital expenditure, although we do have that plant that we are going to convert in the course of this year. We are focusing a lot on our productivity, something that we get all the basic metrics back in place to improve our productivity. In this Slide number 31, we also talked about our management team that we put together in South Africa. I think we’ve cast the net there very wide. We’ve looked at many people in South Africa. And I’m glad to say that the appointments we made was really from in Harmony. It just goes to show the type of talent that we have in our midst. On cash flows, we can see that our EBITDA in rand terms have increased dramatically. Unfortunately, I don’t have the slide in front of me in dollar terms. And we also look at the -- when we look at our firing power where we had cash and facilities available of about ZAR1 billion in the beginning of the year, we are now sitting at ZAR4.7 million available for probable -- for use in the Company. ZAR1.3 billion of that is in rand and ZAR3.4 billion is in facilities. This morning we spent a lot of time on our lasting impact. The first thing is our approach to health, our approach to health has been very, very successful built on three pillars: being proactive, the proximity of having our health hubs at the operations and our doctors being part of the management team, and also a curative pillar. The long and the short we are on this track now for probably three/four years. We now have about 1,000 more people at work per day than we used to have in the past through this approach. And I’m very proud of that. Our mining rehabilitation is also one of the areas that we distinct ourselves from our peers. We are really doing well. We rehabilitated 32 disused or closed shafts and a number of processing plants. And we’ve created a lot of jobs through that. But we are also working on commercial agriculture projects that’s coming from the implementation of some of the areas that we don’t use anymore. And then we are also commissioning a bio-energy plant, which is -- we will start at the end of this month we’ll start with the first gas. We will be able to generate 1 megawatt of power that we are going to use in our processing plants. I’m going to ask Frank just to maybe give some points on the balance sheet under heading of the strong balance sheet, so Frank can maybe give us some -- just a short summary of what we see.

Thank you, Peter. The middle of last year we made a decision that it was very important to get a strong balance sheet. We were very fortunate with the increase in the rand gold price, and our good production last year. We were able to buy back a major portion of our debt. We’ve also been able to, if we page to Slide 39, when the rand/dollar currency weakened in February we were able to lock in at a very good rate the rand/dollar exchange rate. We did a zero cost collar there. And you can see on the blue line that was at ZAR15.60. We locked in the exchange rate, so for $500 million. So it means that for $500 million of gold sales we will be receiving ZAR15.60 for our dollars, our gold sales. If we assume the current rand, gold, if the rand/dollar exchange rate stays the same at the current level of ZAR13.50 that’s a gain of more than ZAR1 billion. And the reason we did this is because there was a very good margin in our profit. We believe that the rand was very weak at that stage and they were specific reasons that led to it. And we wanted to lock it in, and to make sure that we can pay back our debt. If you turn to Slide 40, we also did a rand gold hedge. We hedged 20% of our rand gold sales. And we were very fortunate to do that at the beginning of July. And you can see that we did it from a level of ZAR640,000 per kilogram. And we did it for a two-year period that’s 20% of our gold production. I think it’s 432,000 ounces over the two years. And the average price that we are achieving over that period is ZAR680,000 a kilogram. So if you look at where the rand gold price is now we are well in the money on that hedging strategy too. And the purpose of all of this was to make sure that we can pay back our debt. If we turn over and we go to Slide 42 this is the extract of our income statement six months on six months US dollars. You can see that our revenue came down very slightly 2% for the six months, which was due to lower gold produced during this period although our production costs came down quite substantially. And this was because of the exchange rate that was much weaker in the second period than in the first period. This linked to a production profit of $200 million. If we take that down to the bottom line, our net profit for the period was $91 million compared to a loss of $33 million the year before. If we page over, and we go to Slide 44, and we look at the extract from our income statement year on year in US dollars, our revenue reduced by 6% over this period. Our gold production was the same year on year. But the dollar gold price was slightly lower. If we look at our production, costs came down substantially and that’s because of the exchange rate over this period. You can see that our production profit was $350 million. That was fully 3% more than the year before. If we go down, we’ll see that our net profit was $64 million versus a loss of $374 million the year before. The year before we not only had a lower production profit but we also had impairment of certain of our assets. But you can see that’s a very good turnaround from where we were the year before. If we turn over, in regard to Slide 46, this is the slide where we tried to unpack our net debt figures. In the first column, you’ve got your debt, so we start with our opening balance. That’s what our debt was, $290 million at the end of June. You can see we’ve repaid it and it’s currently $159 million, so we paid back $120 million. Our cash in dollar terms have gone down slightly with $3 million, so if we look on the right-hand side when we look at our net debt situation, you see our net debt has come down to $74 million. Our net debt came down by $118 million year on year. We are very confident that the $74 million net debt we’ll be able to repay before the end of the calendar year. Thank you, Peter.

Thanks. Maybe just before we close, first of all, our FY'17 production guidance that we obviously shared with everybody this morning, we plan to produce approximately 1.05 million ounces. Obviously Hidden Valley is not a part of that going forward. Or Hidden Valley is actually just a [indiscernible], mining the stockpiles, and then an average recovery grade of 5.13 grams per ton, with an all-in sustaining cost of $1.1 million an ounce at the exchange rate of ZAR14 to the dollar. We also just shared our earnings per share in rand terms have dramatically improved, and then we also then obviously concluded with the whole thing about aspiring to grow our ounces to 1.5 million ounces by being -- mining safe and profitable ounces, increasing our margins through operational excellence, cash certainty and effective capital allocation. Are there any further questions?

Chris, just before we hand over for questions and answers, I would also just like to refer the listeners to the appendices to our presentation that was shared this morning, where we have shared more detail on the guidance as well as more detail on the hedging. And with that, we are happy to take some questions.

[Operator Instructions] We have a question from David Leffel of Deutsche Bank. Please go ahead.

Good morning. Great results, guys. Excellent job. I guess on the asset disposals, where are we at with those and how much would that reduce the guidance around the 1.05 million ounces if that as identified for sale were actually completed or will they be completed in this calendar year?

David, thanks for the question. The only asset for sale we had was Hidden Valley. We put it up for sale. We didn’t get an offer that was a suitable offer, so we decided to pull it out of the market, ourselves and our partners. We have not made a decision in terms of how we’re going to take it forward. We’re still at the moment debating it with one of the partners. We still have that discussion. We will -- as soon as we’ve got certainty, we will disclose it to the market in terms of what we want to do with Hidden Valley. But Hidden Valley at the moment, we are mining the stockpiles. We did not start the cutback of cutback five and six that’s still outstanding, that need to be done. We had not started that. Obviously, the gold price has improved a lot and the dollar price in the last few weeks and months, and if we are bullish in the gold price, it actually becomes quite a lucrative operation. But we have made no decision to start that operation yet. In our current plan, the stockpiles, the mining of the stockpiles and also the last part of Hamata pit, which is a smaller pit in the area, is actually part of the plan.

Okay. Well, I wasn’t really focused on Hidden Valley, but maybe I’ll ask it. The cutbacks of stage five and six are still about $50 million, and what would be the operating costs of that asset if you actually proceeded?

We’re actually busy with that study now, David, so I don’t want to dilute much. The total forward, obviously, with a 50-50 JV, is the total of the cutback will probably be in the vicinity of about $100 million. You’re quite correct, and $50 million for Harmony, but we have not actually completed that work to see precisely what it will cost.

So you don’t actually know what the operating cost might be for that?

We’re actually busy with that study at this point in time.

What was the cost per ounce in the previous days when you decided not to proceed with and put the asset up for sale. What were you guys working with as a cost per ounce on cutback five and six ounces?

David, being open of course, it’s very much dependent on the volume that we produce. So if you look at the cash cost or the cost for Hidden Valley over the last few years, depending on what the volume is, the first portion of this, yeah, sorry, in the second part of this year, we actually had pretty good costs at Hidden Valley because of the high volumes that we were mining. So it’s very dependent on the volumes that we’ve been mining.

Okay. I was just trying to understand where this project might sit with any acquisitions that you’re looking at in that regard and the capital demands on the Company. But my original question, I guess I was really wondering where we are in the status of the disposals of Masimong and Unisel.

We’re not disposing of any of those operations. We’re in actual fact mining now to completion Masimong and Unisel, what we share in the harvest form of the operation. There’s not much more to mine. The places are really mined out. They’re in the final stages of the results. The one big one is obviously Kusasalethu. This we say that with Kusasalethu, I think I explained that when we were previously, is that Kusasalethu, we’re in the high grade at the moment, so we’re going to make good money going forward for the next five years. Going forward, when we want to actually get into low grade, we’ll have to increase the volume dramatically. There’s only four levels available to be mined and to mine the top of 25,000 square meters a month out of four levels is going to be quite tough to do from a mining perspective. It’s not impossible but highly unlikely. So we don’t believe that that’s the right place to spend more capital, to build up that volumes. So we in actual fact want to for the next five years mine Kusasalethu and harvest some good profit out of that.

I guess for the next 12 months or 24 months, what sort of volumes, what sort of tonnage and grade should we model for Kusasalethu.

At the back of the guidance you’ll find it. Let me just be clear. Kusasalethu, there’s the cost one, grades. The production for Kusasalethu for the next year is 140,000 ounces per annum.

Okay. Thanks so much.

That’s up from 124,000 in the previous year.

And then the costs are sitting at about $1,170 per ounce.

Yes, and have you given us any guidance where you think you can get it under the new plan?

Well, that is the plan that we started. This is the plan.

Okay, so $1,170. Okay, okay great. So maybe one last question, international acquisition for South African gold companies, in recent years there haven’t been very many examples. I think a lot of investors wonder as you may be set out to try to do acquisitions outside of South Africa and PNG, what core competencies you might bring that others wouldn’t bring. Clearly, gold assets are -- there’s a substantial demand for gold assets at this point in the cycle.

Well, David, we’re fully aware of that and it must make financial sense for us to do, but what we need to do and that is I think important for us is that we need to do either a merger or acquisition to give us the firepower to build or to beef ourselves up to build to Golpu. Otherwise, if some of these production operations, if they actually go much smaller, then as a small operation we’ll never be able to fund and to build Golpu.

Okay. Okay, great. Thanks, guys. Appreciate that.

Thanks, David.

Thank you. Our next question is from Daniel McConvey of Rossport Investments. Please go ahead.

Good day. I think we’ll have to do our homework next time, so we’ll be ready for your questions right away. Just two questions. The first one is the top one. I’m a little rusty, but on the fatalities are a tragedy for the people. They’re a tragedy for the Company and it’s tough for the investors. What kinds of things are in the program just in terms of trying to improve that down the road? In the platinum industry, there’s been more ground support put in the last, what, five to seven years that has been helpful. What kind of things are happening in your industry and definitely your mines are older and a lot of them are deep and tough? How do you marginally at least go ahead and improve that?

Daniel, yes, thank you for that. Obviously like you said, fatalities are very traumatic for everybody involved. It is extremely -- obviously for the morale of the operations, if there’s something that really derails an operation, it is a fatality. Now, we -- Harmony has been very, very active in the so-called MOSH adoption. MOSH is the Mine Occupational Safety and Health initiative that was started in South Africa some time ago. It’s really focusing on fall of ground. It’s focusing on rail-bound accidents and focusing on dust and noise. In those four areas, we very much adopted all the things that we had to do, and we saw very good successes. If one looked over the years, our safety improved dramatically from where it was like 10 years ago. We saw very good improvements on that. So like everybody else in South Africa, we’re somehow in the beginning of this calendar year had a bit of laxity in terms of fall of ground accidents. It’s not only Harmony. There’s been quite many companies that had fall of ground accidents start to raise its head again. We reintroduced all of the things that we’ve put in place in the past, making sure that we actually have all of those actions that we’ve put in place put back in place. But in the meantime, if you look at my structure that I’ve put together, I took one of the Chief Operating Officers looking after the long-term plans, long-term growth of the Company and also looking after the safety strategy. So we are at the process of really looking at what is the best possible, world-leading safety and management systems that we have to put in place for Harmony. And we’re not only looking at the mining companies. We’re also looking at many other type of companies, typically petrochemical companies and those type of things to see what are the things that they’re doing that we can learn from. So Phillip is at the moment quite far down the line. He’s been interviewing and actually visiting and going underground on the different operations or onto site to verify how the strategy actually gets into action on the ground. So we certainly would like to, by the end of this calendar year and to be in the position that we have a world class safety management system that is probably unique to everybody else. We are obviously looking at all the stuff that everybody else is looking at. We’re looking at our fatal risk management, making sure that those risks are properly assessed. We’re looking at leadership, visible self leadership, making sure people are in place, in the faces of the people. We’re making sure that we have included everybody in our operations, recreating the culture of care. We’re looking at continuous improvement and all the different things we’re trying to roll out, all the learnings from different accidents, not only in Harmony but everybody else. But the one thing that I think we really distinguished ourselves from everybody else is that we’re really focusing a hell of a lot on our housekeeping, making sure that our places are in really good order and neat. For that reason, we have not seen the big uptick in Harmony that many of the other companies in terms of so called safety stoppages, because we are really, and I’m really proud of what I’ve seen so far in the organization in the last six months I’ve been here. My team that I’ve got now is all fully aligned in terms of focusing on these things and making sure the housekeeping is in packing order. Obviously, it’s not always perfect and sometimes we do find places that has not done the right thing. Certainly our fatalities in the last few of them were really the ones of specialized type of job, not a typical fall of the ground or rail-bound equipment type of fatalities. It was different fatalities than that, when we talk about the last ones we had in the last quarter. But certainly we are, we know that we have to stop fatalities. We know that we have a big impact on that, Daniel.

Thank you, on a lighter note just for Frank, on the hedging, the hedging looks well timed. Just in terms of credit, I guess the exchange rate was a put cost. I’m guessing it didn’t add much to your credit, but in terms of your credit impact and how much credit capacity your hedges use, but did it use a fair bit? Could you do, I’m not saying you want to but if you [Technical Difficulty].

Yes, thank you. That’s a good question. You remember at the time when banks only lend you money when you’re hedged, today they are concerned when you hedge. Then that takes up your credit. In the old days, you only got credit if you hedged. If you look at what we’ve got now, it’s always relative to where you are, and if you can look at those two, you find that both of them are actually in the money. So no, it’s not taken up our credit.

Thank you. Our next question is from James Whitecross. Please go ahead.

Hi, good afternoon, everybody. Good results. I was just wondering, on the grade control side, could you provide us some more granularity just on the improvements ahead and how this has helped costs with your expected productivity gains? I guess the third part of that thesis is if you do go ahead with the consolidation of Phakisa and Tshepong, does that accelerate the grade improvements or does it change something else? Thank you.

You take the first part? The first part of the question on the…

On the grades?

No.

How the grades affect the costs.

No, I would do the grade one. You do the [indiscernible].

I missed the first part.

Let me talk about the grade of Tshepong and Phakisa. What Phakisa and Tshepong will hold with one another in the bottom part of Tshepong and also obviously in Phakisa’s side, that is the high-grade area. If we are able to mine more from that higher grade, we will as a fact [ph] mine more high grade earlier in the combined unit than the earlier. If one looks at Tshepong, Phakisa, we’re probably doing about 300,000 ounces a year out of those two operations, and we’re probably going to go to 350,000 to 375,000. We haven’t finalized the feasibility studies and everything on that, but that is a possibility in terms of where we can go. Now certainly we’re going to mine more of the high grade during that period, but we’re also very excited about Tshepong and Phakisa because we identified a lot of B reef, secondary reef to the basal, which is the main reef in the area. We’ve been very successful at Tshepong -- at certain parts of Tshepong and then also at Masimong to mine the B reef. And those shoots we know is extending into Phakisa and also certain parts of Tshepong. So we are spending some money at this point in time to draw for them. We are very high levels of confidence that we will be able to get those reefs. We know we’re going to get them. So we need to identify them, where they are and actually in fact then start mining them. But yes, it will increase the grades and it will then obviously -- I think we will be probably four to five years be in a very sweet spot as far as those two operations are concerned.

And sorry, just to add to that, of course we know grades improve and that increases -- that reduces our cost per kilogram, our unit cost. So we can mine less tons and get more the same gold and are therefore ore. Seen the other way, we’ll mine the same tons but get more gold, and that’s going to reduce our cost per unit.

Do you have any idea of the scale of that? Is it 10% or 3% or…?

I think it will probably be from about 280,000 combined. Currently, they’re doing about 280,000 ounces a year to 350,000 to 375,000. Probably that’s the kind of uplift that we’re going to see.

[Operator Instructions] Sir we have no questions in the queue at the moment. Do you have any closing comments?

First of all, just thank you for joining us. I’m surprised it’s the afternoon already. It’s really nice having you on the call. We are really excited about Harmony and also the momentum that we started to gain on all our operations. I’ve got some very young and energetic RGMs and Chief Operating Officers that really are busy making the difference. So we are very confident of the future of Harmony and especially over the next few years. Thank you very much.

Thank you, sir. Ladies and gentlemen, that concludes this conference. Thank you for joining us. You may now disconnect your lines.