DRDGold posts sharp fall in profit

DRDGold posted a sharp fall in interim profits after closing a number of sites, laying off staff and depreciating its assets. DRDGold, which treats tailings dumps to extract residual gold, reported a 5% rise in revenue to R1.19bn for the six months to the end of December as the rand-gold price rose 16% compared with the previous period.

DRDGold posted a sharp fall in interim profits after closing a number of sites, laying off staff and depreciating its assets.

DRDGold, which treats tailings dumps around Johannesburg to extract residual gold, reported a 5% increase in revenue to R1.19bn for the six months to end-December as the rand-gold price increased by 16% to R572,443/kg compared with the year-earlier period.

Gross operating profit declined to R35m from R64m, with increased operating costs, R18m in retrenchment payments and R102m in depreciation the causes.

A higher salary bill stemming from an average 8.5% increase in wages as well as higher electricity and water costs contributed to the decline.

Profit fell to R2.7m from R18m and DRDGold reported a headline loss of R10.2m, or 2.4c a share, compared with headline earnings of R10.9m, or 2.6c per share, a year ago.

Gold output fell 7% to 2,100kg because of lower throughput and a 6% drop in yield to 0.166g/tonne.