DRDGOLD posts 17% rise in operating profit - CNBC Africa

DRDGOLD posts 17% rise in operating profit


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Gold mining. PHOTO: Getty Images

While their operating profit increased 17 per cent, gold production also rose 4 per cent with a 14 per cent drop in all-in sustaining costs.

“The increase in gold production was the result of a 9 per cent increase in the average yield, which offset a 4 per cent drop in throughput,” said the company in a statement.

Construction of their flotation/fine-grind (FFG) circuit at Ergo’s Brakpan Plant was completed in January 2014 and the circuit is currently at full production.

Niel Pretorius, chief executive officer of DRDGOLD, stated that the company is pleased with their performance however their aim was to have their FFC circuit operational in December 2013.

“We are pleased that production was back up, but we would have preferred to have had the FFG circuit fully operational by the end of December 2013. That is what we told the market we were aiming for. Unfortunately, delays in getting the last of three thickeners up and running pushed final commissioning back by at least three weeks,” explained Pretorius.

For the half-year ended 31 December 2013, gold production was down 8 per cent compared with the first six months of 2013. Cash operating profit was also down 62 per cent on the back of the drop in production, a 14 per cent rise in all-in sustaining unit costs and a 9 per cent decline in the average gold price received.

DRDGOLD’s full operating and financial results for the quarter and six months ended 31 December 2013 will be released on the 11 February 2014.