SA gold producer DRDGold says it’s on track to reward investors with a half-year dividend, even as gold sales fell slightly during the three months ended September 30 and the company undertakes a R1.4bn capex programme.
“[The business] remains in a favourable position to, in the absence of unforeseen events, consider declaring an interim cash dividend in or around February 2023,” DRDGold said in an operational update for its first quarter on Wednesday.
The company, which specialises in extracting gold from the retreatment of surface tailings, reported a 1% quarter-on-quarter increase in production to 1,453kg, due primarily to a 1% increase in tonnage throughput.
Gold sales for the period, however, decreased marginally, by 4kg to 1,442kg.
In its annual financial report for 2022, DRDGold indicated that production for 2023 was expected to be 4,500-5,100kg, about 15% lower than in 2022.
Cash operating costs per kilogram increased 2% quarter on quarter to R658,530/kg, while cash operating costs were stable at R133/tonne.
Adjusted ebitda decreased by 19% from the previous quarter to R386m, primarily due to an insurance claim of R84m recognised in the previous quarter, DRDGold said.
Cash and cash equivalents decreased by R280m to R2.25bn after paying a final cash dividend of R342.5m for the year ended June 30 2022.
In the previous financial year the group paid a 60c dividend, down from 80c in 2021.
The company said that cash generated during the current quarter will, among other things, be allocated to an extended capital expenditure programme with total budgeted investment of R1.4bn for the year.
CEO Niël Pretorius previously told Business Day that the business will be spending about R500m this year on implementing solar power and power storage at its facilities.
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