DRD Gold reports 37% profit

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DRD Gold CEO Niel Pretorius. File photo by Simphiwe Mbokazi

Johannesburg - Gold producer DRDGold reported a 37 percent increase in operating profit in the second quarter ended December 31, the company said on Tuesday.

The company also had a 25 percent rise in headline earnings per share in the same period.

Niel Pretorius, CEO of the JSE-listed company, said the results were satisfactory and a reflection a solid performance from surface retreatment subsidiary Ergo, in Brakpan.

“Consequently, we are delighted to declare an interim dividend of 14 South African cents per ordinary share,” Pretorius said.

Operating profit stood at R238.7 million, which resulted from a nine percent increase in gold production to 39,031 ounces

Pretorius said cash operating costs were 12 percent lower, at US1 017 an ounce (about R9051).

Headline earnings per share increased by 25 percent to 25 South African cents a share.

A new flotation and fine-grind circuit was being built at a cost of R250m, as the first product of DRDGOLD’s research and development programme to improve gold extraction efficiencies at its Ergo metallurgical plant in Brakpan.

Currently, the Ergo plant uses carbon-in-leach (CIL) technology to extract gold from mine dump material.

DRDGold expected the new circuit to improve gold extraction efficiency by between 16 and 20 percent.

DRDGold planned to package and sell the discontinued East Rand Proprietary Mines (ERPM), and the 50 percent-owned Zimbabwe-based exploration joint venture Chizim Gold.

The company declined to disclose the value and potential price of the assets, and said internal discussions on the matter were still ongoing. - Sapa


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