SA miner DRDGold rewarded shareholders by doubling its annual dividend after soaring gold prices enabled the company to more than double its cash reserves.
The group declared an annual dividend of 40c per share as headline earnings per share (HEPS) jumped 69% to 260.6c.
A 31% rise in the average rand gold price pushed revenue up 26% year on year to R7.88bn, offsetting a 3% slip in annual gold output.
The slightly weaker operational performance was primarily attributed to heavy rains which disrupted its Gauteng operations in the third quarter, as well as lower grades at its Ergo mine.
Gold sales from the Ergo operation were down 4%, while sales at Far West Gold Recoveries (FWGR) edged down 1% from the previous year.
“The first half of financial year 2025 was sound while the third quarter was quite seriously disrupted by the late arrival and high volume of the summer rainfall,” said DRDGold CEO Niël Pretorius.
DRDGold’s core business involves extracting left over gold from mud-like residual ore waste in mines at two tailings retreatment operations in SA.
First is the Ergo operation, acquired from AngloGold Ashanti in 2007 and stretching from central Johannesburg to Ekurhuleni, and second is Far West Gold Recoveries (FWGR) near Carletonville in Gauteng.
In its annual results, the group laid out ambitious plans for Ergo, whose lifespan it aims to extend beyond 2040 by expanding its deposition capacity and reworking its cost profile.
The company said that “Ergo 2” will provide a new face to the vast area of land immediately to the southeast of Johannesburg’s CBD, around Nasrec, which is currently occupied by three mine dumps.
“Our plan is to reclaim these dumps and retreat them through Ergo, creating what is referred to as a ‘corridor of freedom’, hundreds of hectares of previously sterilised land cleared for redevelopment, linking Johannesburg with Soweto.
“A huge environmental burden in terms of dust and water management will disappear. And Ergo could ‘go out with a bang, not a whisper’,” said Pretorius.
In the near term, this means that Ergo’s production outlook will track lower than before as it processes lower grade dumps, with the operation only returning to a throughput of 1.8-million tonnes a year from early 2027.
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