DRDGOLD has declared a final dividend of 40 cents per share for the year ended 30 June 2021, with group operating profit increasing by 39% to R2.2 billion.
This is the 14th consecutive financial year of DRDGOLD declaring dividends. The company achieved 99% of the upper limit of its production guidance and exceeded its cash operating cost guidance of R535 000/kg by just 1%. At year-end, the company remained debt-free.
Of DRDGOLD’s 2021 financial year, CEO Niël Pretorius says: “By producing and selling more gold at a substantially higher average Rand gold price and containing working cost increases reasonably well, we recorded a much higher operating profit.”
“Importantly, with a view to the future, we were also able to initiate – and in some cases complete – important capital projects at both of our operations. All of these are intended to help us do more of what we do, better. We have begun, and will continue in the months ahead, to report regularly to stakeholders on our various improvement initiatives.”
Pretorius attributes DRDGOLD’s outstanding performance to the people who made it all happen: “It is to the credit of our employees, contractors, suppliers and other stakeholders that we were able to do so safely, in compliance with rigorous, restrictive but absolutely necessary COVID-19 precautions.”
The Group’s total gold production increased by 6% to 5 723kg reflecting an 11% increase in throughput.
Group cash operating unit costs were 12% higher at R540 338/kg. The key drivers of the increase were the decrease in yield at Ergo, a 15% tariff increase by power utility Eskom which came into effect in April 2021 and the first full year of milling at FWGR.
Headline earnings were 127% higher at R1.4 billion (168.4 SA cents per share), compared with headline earnings of R634.5 million (82.4 SA cents per share) in the comparative period.
Pretorius regards industry COVID-19 vaccinations as a top priority: “With the rest of the country’s mining industry, we are encouraging our employees, their families and the communities where they live to be vaccinated and are facilitating the process in co-operation with the relevant health authorities.”
He says that the global economy is responding more and more to environmentally responsible energy generation and green energy solutions, adding that DRDGOLD is aligning itself with the strategy of Sibanye-Stillwater to create these clean energy solutions.
“Our guidance for FY2022 is production of between 160 000oz and 180 000oz at a cash operating unit cost of approximately R600 000/kg and a capital investment of approximately R600 million.”