Harmony Gold Mining Co. (ADR) (NYSE:HMY) cost reduction efforts managing to woo investors.


Dallas, Texas 01/07/2014 (FINANCIALSTRENDS) – Harmony Gold Mining Co. (ADR) (NYSE:HMY) is an South African gold mining firm which has raised funds for its operations from the U.S financial markets in the form of American depository receipts.

Over the past eight months, the stock of the gold mining firms in general and South Africa based mines in particular have been struggling to turn in profits due to the softness in the price of gold in the international markets. In addition to the drop in demand for the precious metal, the South African gold mining firms including Harmony Gold Mining Co. (ADR) (NYSE:HMY) have been faced with recurring labour unrest which has led to suspension of mining activity. This had led to drop in the production of gold in these mines and in turn led to disruption in their cash flow.

Harmony Gold Mining Co. (ADR) (NYSE:HMY) management has been attempting to tide over the tough economic conditions by bringing in cost cutting measures and by shelving projects which have a big capital expenditure outflow. They have also attempted to bring in efficiencies of scale by temporarily shutting down mining properties which involve greater input costs. These operational challenges had led to the $1.12 billion market capped mining firm posting net losses of $310 million from its operations over the trailing 12 months from sales of $1.69 billion in the same period.

Harmony Gold Mining Co. (ADR) (NYSE:HMY) efforts at cost reduction and achieving operational excellence has led to the stock finally managing to attract investors. This has resulted in the market valuation in the stock going up by a significant 2.7 percent during trading last week. This upward movement in the stock value last week is reversing the close to 69 percent drop in value that the share holders have experienced in the past one year. The share price of the stock on January 6 was $2.58 per share.