Media releases

DRDGOLD’s increase in cash operating costs and decrease in Rand gold prices result in decreased earnings

Johannesburg, South Africa. 03 February 2022. DRDGOLD Limited (DRDGOLD; JSE, NYSE: DRD) advises in a trading statement released today that it expects to report earnings per share (EPS) and headline earnings per share (HEPS) of between 52.5 cents and 63.6 cents for the six months ended 31 December 2021 compared to EPS and HEPS of 111 cents for the previous corresponding period, a decrease of between 43% and 53%, respectively.

The expected decreases in EPS and HEPS are mainly due to the 13% decrease in Rand gold price and an 11% increase in cash operating costs to R1,680.2 million (2020: R1,518.8 million).

The condensed consolidated interim results for the six months ended 31 December 2021 are expected to be published on or about 16 February 2022.

Ergo’s revenue decreased by 20% to R1,804.6 million (2020: R2,268.7 million), due mainly to a 13% decrease in the Rand gold price received as well as a 9% decrease in gold sold to 2,090Kg (2020: 2,296Kg). Gold sold decreased as a result of the bulk of the higher-grade reserves in the Knights area reaching the end of life of mine. Cash operating costs at Ergo increased by 12% to R1,471.8 million (2020: R1,316.9 million) due to the 1% increase in volume throughput, an increase in the use of reagents as a result of the increase in volume throughput together with a change in the minerology of new mining sites, and above CPI (consumer price index) increases in steel and reagents.

Far West Gold Recoveries’ (FWGR’s) revenue decreased by 2% to R693.8 million (2020: R708.7 million) despite a 13% increase in gold sold to 801Kg (2020: 710Kg), due to a 13% decrease in the Rand gold price received. Gold sold increased due to an increase in higher-grade material reclaimed from Driefontein 5 and improved gold bullion purities resulting from the implementation of the copper elution circuit. FWGR’s cash operating costs increased by 3% to R208.4 million (2020: R201.9 million).

During the interim period ended 31 December 2021, DRDGOLD generated free cash flow (cash inflow from operating activities less cash outflow from investing activities) of R406.9 million (2020: R759.6 million) and paid cash dividends of R345.5 million (2020: R299.1 million).

The Group remains free of any bank debt as at 31 December 2021 (30 June 2021: Rnil).

The financial information contained in this announcement is the responsibility of the directors of DRDGOLD, and such information has not been reviewed or reported on by the Company’s auditors.

Investor and media relations queries:

R&A Strategic Communications
Jane Kamau
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