Shares plunged 8% to $20.62 as investors looked past a blockbuster fiscal 2026 and fixated on a cloudier year ahead. Harmony reported revenue up 34% to R99.2 billion, net profit up 102% to R29.5 billion, and headline earnings per share up 87%. Yet the stock's worst day in months signals a clear verdict: Wall Street is pricing the future, not the past.
Record Year, but the Hedge Book Ate Into the Windfall. Although the average gold price received soared 46% to $3,811/oz, a realized loss of R9.65 billion (~$571 million) on Harmony's gold hedges offset a significant chunk of that upside. Hedging — where a miner locks in a future selling price to protect against downturns — backfired as spot gold ran well past the locked-in rates. The company says it continues to hedge to protect margins during its capital-heavy build phase , but each quarter of rising gold prices makes those contracts more expensive. On a quarterly basis, EPS of $0.95 missed the Street's $1.29 estimate by $0.34 , a gap wide enough to trigger today's selloff.
FY2027 Guidance Points to Less Gold and More Spending. For FY27, Harmony guided gold production at 1.3–1.4 million ounces at higher all-in sustaining costs of R1.30m–R1.395m/kg — a meaningful step down from FY26's 1.43 million ounces. Meanwhile, planned capital expenditure is expected to jump roughly 64%, driven largely by construction of the Eva Copper project in Australia. That project alone carries an estimated $1.55–$1.75 billion total price tag over three years, with first copper targeted for late 2028. Investors are being asked to fund a multi-year bet on copper while accepting near-term dilution of gold output.
The Balance Sheet Shifted Fast. Harmony swung from a net cash position of R11.1 billion to a net debt position of R852 million (~$52 million) after completing the MAC Copper acquisition.
Net debt-to-EBITDA remains a razor-thin 0.02x with R17.1 billion of available liquidity , so the company is far from distressed. But the trajectory — from cash-rich to leveraged in one year — narrows the margin for error if gold prices correct or Eva Copper overruns.
Cost Inflation Is Creeping Higher. Royalty expenses climbed ~R1.5 billion, tax expenses jumped ~R2.3 billion, and roughly R1.4 billion in acquisition and integration costs weighed on profitability , alongside rising labor and electricity bills. The most recent analyst consensus is a Hold at $24 , suggesting some see a post-selloff opportunity — but only if Harmony's copper gamble pays off on time and on budget.