Battling operational hurdles, DRDGOLD delivered a strong financial performance for the fiscal year concluded on June 30, 2023. CEO Niël Pretorius, in the annual report, highlighted a notable 14% surge in headline earnings, hitting 148.2 cents per share from producing close to 170,000 ounces of gold.
Despite a volume throughput drop of 18% to 23 million metric tonnes, the company’s yield rose by 13% to 0.229 grams per tonne. This surge in efficiency yielded a cash operating profit of 1.8 billion rand, following a tax payment of 314 million rand and reinvestment of 1.1 billion rand in capital expenditures, which underpinned a dividend hike from 60 cents to 85 cents, marking a consistent 16-year dividend record.
According to a report by Mining Weekly, the company strategically blends material from various Gauteng sites to perfect head grade. It is pivoting operations to four new Ergo sites and one at Far West Gold Recoveries as it phases out some high-volume reclamation sites, though the 2023 output felt the brunt of water-use license delays.
Pretorius has since recognized the importance of early water-use license applications and proactive regulatory engagement. Despite battling extreme weather and significant electricity cuts, DRDGOLD still posted strong results, thanks to efficient late-phase clean-up and mechanical mining at legacy sites.
The year’s strong gold prices enhanced group revenue. DRDGOLD is pushing ahead with its 60-megawatt solar photovoltaic plant at Ergo in two stages, set to cut energy costs and the carbon footprint. The firm has dedicated 2 billion rands of its 3.5 billion rand capital plan for the following year to this solar venture.
The company’s commitment to the environment saw an investment of nearly 42 million rand in environmental management, and social and economic development ventures received 55 million rand.
With the new financial year ahead, DRDGOLD aims to sustain business continuity and efficiency, especially in controlling costs amid rising inflation. The company’s gold production forecast is pegged at 165,000 to 175,000 ounces with the new sites’ contributions.
Regarding environmental initiatives, Pretorius disclosed DRDGOLD’s move to include a synthetic liner in its tailings storage facilities, aligning with top local and global standards. With an application to revise the regional facility’s design underway, the firm expects a regulatory nod within the 2024 fiscal year, committing around 284 million rands of the year’s budget for the changes.
Should there be any hold-ups in approvals, DRDGOLD has prepared to employ Sibanye-Stillwater’s Leeudoorn TSF as a temporary substitute, showcasing its commitment to the Global Industry Standard on Tailings Management and its strategic operational foresight.
