DRDGold to pay dividend despite fall in sales
DRDGOLD, the listed company focused on mining gold tailings at its Ergo plant, east of Joburg, said yesterday that it would pay a final dividend, despite reporting a fall in gold sales and production during the quarter ended March 2021.
The New York-and JSE-listed mining group recorded a 35 percent fall in earnings before interest, taxes, depreciation and amortisation from the previous quarter to R371.7 million at the end of March on lower gold sales and a fall in the gold price.
Gold sales fell by 8 percent to 1 363kg (43 822 ounces) from 1 484kg (47 712 ounces) at the end of the December 2020 quarter while the rand gold price received was R857 895/ kg, 9 percent lower than the R947 056/kg at the end of December.
The group said cash and cash equivalents fell by R3.7m to R2.165 billion as at March 31, 2021, from R2.169bn at the end of December after paying the interim cash dividend of R341.8m for the six months ended December, 31, 2020. The group said it would consider paying a final cash dividend in August.
“The cash generated during the current quarter will, inter alia, be applied towards the company’s extended capital expenditure programme for the year ending June 30 2021. Despite the capital expenditure planned for the year, the company remains in a favourable position to, in the absence of unforeseen events, consider declaring a final cash dividend in or around August 2021,” said the group.
DRDGold declared an interim dividend of 40 cents a share for the six months ended December 31, 2020 after revenue increased by 41 percent to R2.97bn and operating profit rose by 100 percent to R1.44bn due largely to the average rand gold price received, which was 42 percent higher at R988 998/kg.
DRDGold said gold production decreased by 6 percent at the end of the March quarter from the previous quarter to 1 382kg (44 433 ounces) from 1 470kg (47 262 ounces) at the end of the December quarter in 2020, primarily due to a 9 percent decrease in yield, despite a 3 percent increase in tonnage throughput. As a result of the lower gold production, the cash operating costs per kilogram of gold sold increased by 3 percent from the previous quarter to R549 817/kg. All-in sustaining costs per kilogram and all-in costs per kilogram kg were R645 488/kg and R654 072/ kg, respectively, increasing quarteron-quarter mainly due to an increase in sustaining capital expenditure.
DRDGold shares closed 5.39 percent lower at R14.05 on the JSE yesterday.