JSE-listed DRDGOLD has delivered strong operational and financial results for the quarter ended March 31, driven by higher throughput, disciplined cost management and continued exposure to a favourable gold price environment.

“The quarter demonstrates the resilience and cash-generating capacity of our business.

“Improved throughput, disciplined cost management and a stronger gold price enabled us to continue funding our growth programme internally, while maintaining a strong balance sheet,” says CEO Niël Pretorius.

The company reports that revenue increased by 6% quarter-on-quarter to R2.96-billion, or $181.5-million, as a 13% increase in the average gold price received to R2.57-million a kilogramme, or $4 886/oz, offset a 6% decrease in gold sold to 1 155 kg.

Adjusted earnings before interest, taxes, depreciation and amortisation (Ebitda) increased by 21% to R1.81-billion, or $111-million, while operating profit rose by 19% to R1.85-billion.

Gold production increased by 6% to 1 219 kg as a result of a 5% increase in throughput to 6.27-million tonnes and a slight improvement in yield to 0.194 g/t.

DRDGOLD explains that throughput improved as drier weather conditions supported a recovery from the early rainfall experienced during the previous quarter.

Cash operating costs increased by 5% to R1.19-billion, driven mainly by higher reagent consumption and trucking costs associated with increased throughput.

However, increased production volumes resulted in cash operating costs per kilogram decreasing by 4% to R960 270/kg, while unit costs per tonne remained stable at R190/t.

DRDGOLD reports that the group increased its cash and cash equivalents by R581.9-million to R2.32-billion, despite the payment of an interim cash dividend of R433.6-million.

Growth capital reduced by 16% to R683.2-million as both the expansion of the Driefontein 2 plant and pipeline network, as well as the Daggafontein tailings storage facility (TSF) project, progressed beyond peak capital during the quarter.

Investment continued across key strategic projects at Far West Gold Recoveries (FWGR) and Ergo, including the regional TSF construction.

These projects form part of DRDGOLD’s Vision 2028 strategy to expand processing flexibility, aimed at extending the operating life of its assets and supporting long-term production growth.

All-in sustaining costs decreased by 5% to R1.07-million a kilogramme, while all-in costs decreased by 7% to R1.67-million a kilogramme, supported by increased production and lower non-sustaining capital expenditure.

OPERATIONAL OUTLOOK

DRDGOLD says it remains on track to achieve the upper end of its production guidance range of between 140 000 oz and 150 000 oz of gold for the full-year to December 31, while maintaining cash operating cost guidance at about R995 000/kg of gold.

The company says the group’s liquidity position continues to support the internal funding of its expanded capital programme while maintaining a debt-free balance sheet.

DRDGOLD notes that it retains access to a R1-billion revolving credit facility and additional banking facilities should they be required.

“The current gold price environment gives us an opportunity to continue to strengthen the business for the long term.

“Our approach remains focused on disciplined reinvestment, extending the life of our assets and maintaining the financial resilience that allows us to remain competitive through the cycle,” says Pretorius.