JSE-, ASX- and NYSE-listed DRDGOLD has reported a 14% year-on-year increase in revenue to about R6.24-billion for the financial year ended June 30, which the company said was mainly owing to a 20% increase in the rand gold price to more than R1.2-million a kilogram.

DRDGOLD’s full-year results will be published on August 21, when the company expects to announce earnings per share (EPS) of between R1.47 and R1.62,  compared with EPS of R1.49 reported for the 2023 financial year, being a change of between -2% and 8%.

The company also expects to report headline earnings per share (HEPS) of between R1.47 and R1.62, compared with HEPS of R1.48 for the 2023 financial year – a change of between -1% and 9%.

The expected year-on-year changes in EPS and HEPS are mainly attributable to the higher revenue, the company noted in a trading statement.

Ergo Mining revenue increased by R416.3-million to about R4.52-billion from about R4.1-billion a year ago, mainly owing to the higher rand gold price.

Gold sold decreased by 8% from 3 936 kg in the 2023 financial year to 3 625 kg in the year under review as a result of a year-on-year decrease in throughput tonnages from 17.3-million tonnes to 16.1-million tonnes, which was impacted on by the late commissioning of the 5L27 and 4L3 sites.

DRDGOLD said the Department of Water and Sanitation (DWS) had requested unanticipated design amendments and studies for the 4L3 site, which resulted in further delays in obtaining approvals for the water-use license (WUL).

In addition, community-related disruptions for inclusion in projects experienced at the 5L27 site in the first half of the financial year led to production from this site being delayed until late January.

To augment lost throughput tonnages, Ergo accelerated its reclamation of clean-up and legacy sites, which came at a significant cost, DRDGOLD pointed out.

Yield marginally decreased to 0.226 g/t from 0.227 g/t in the 2023 financial year.

Far West Gold Recoveries’ (FWGR’s) revenue increased by R327.1-million to about R1.71-billion, up from about R1.3-billion in the prior financial year, again owing to the higher rand gold price received and a 2% year-on-year increase in gold sold to 1 364 kg from 1 337 kg.

The increase in gold sold was mainly owing to a 9% increase in throughput tonnages from 5.7-million tonnes in the 2023 financial year to 6.2-million tonnes. However, the lower head grade of the top-layer material reclaimed at Driefontein 3 resulted in a 7% decrease in yield from 0.237 g/t a year ago to 0.221 g/t in the year under review.

Meanwhile, DRDGOLD said the impact of the increase in group-wide revenue on earnings and headline earnings was moderated by a R505.2-million, or 14%, increase in group cash operating costs to about R4.19-billion, up from about R3.68-billion in the 2023 financial year.

At Ergo, cash operating costs increased by R387.8-million, or 12%, year-on-year to about R3.57-billion owing to the significant increase in contract reclamation costs and machine hire costs driven by the mechanical lifting and hauling of material at clean-up and legacy sites for processing.

At FWGR, cash operating costs increased by R117.4-million, or 23%, year-on-year to R622.3-million, owing to operating Driefontein 3 and Driefontein 5 simultaneously, one of which is a clean-up site.

In addition, an increase in reagent consumption driven by the increased acidity and the coarser nature of material reclaimed from Driefontein 3 also added to costs, DRDGOLD said, as did an increase in electricity consumption owing to the longer pumping distance from Driefontein 3 to the FWGR processing plant.

The production delays, reclamation activities at clean-up sites and the rehabilitation programme to process material at legacy sites, resulted in the group falling short of its production guidance of between 165 000 oz and 175 000 oz, producing only 160 850 oz, and consequently exceeding its cash operating unit cost guidance of R800 000/kg with unit costs expected to be between about R820 000/kg and R835 000/kg.

With Ergo’s replacement reclamation sites now fully operational and the clean-up programme coming to an end, DRDGOLD said Ergo’s production was expected to stabilise for the financial year ending June 30, 2025.

Meanwhile, cash expenditure on capital projects increased by about R1.84-billion, or 161%, to about R2.9-billion, up from about R1.14-billion a year prior. The company said this was mainly a result of the construction of Ergo’s solar power plant, which remains on track, with 20 MW now operational, the balance of 40 MW being substantially completed and the addition of 160 MWh battery energy power storage under way.

The entire project is expected to be completed and operational by October.

Capital was also invested at FWGR’s Phase II project, to double the capacity at the Driefontein 2 plant and to start the building of the 800-million-tonne regional tailings storage facility, which is under way.

Designs for the expansion of the Brakpan/Withok tailings storage facility have been completed and application for the WUL and other regulatory requirements will be submitted to the DWS in August, DRDGOLD said.

At the end of the 2024 financial year, DRDGOLD held R521.5-million in cash and cash equivalents compared to about R2.47-billion at the end of the 2023 financial year.

DRDGOLD had a free cash outflow of just less than R1.2-billion for the 2024 financial year, compared with R469.1-million in the prior year. This was after a R1.8-billion increase in cash outflow from investing activities to about R3.04-billion, up from about R1.18-billion the year before, and paying cash dividends of R731.7-million, compared with R515.3-million in the 2023 financial year.

DRDGOLD said that it was free of any bank debt as at June 30.

However, to support liquidity in funding the significant capital expansion programme at both operations, the company secured a R500-million general bank facility with Nedbank’s corporate and investment banking division. The facility remained undrawn at the close of the financial year.

On July 31, post-close, DRDGOLD entered a committed five-year R1-billion revolving credit facility with an uncommitted R500-million accordion option with Nedbank.