DRDGold has reported steady earnings growth in the first quarter as drier weather conditions lifted production and gold prices continued to rise.
In an operating update for the three months to end-March, DRD reported adjusted earnings before interest, tax, depreciation and amortisation (ebitda) up 21% year on year at R1.81bn.
Gold production for the quarter was up 6% at 39,192oz, reflecting a recovery from heavy rainfall in early 2025 and a 5% increase in throughput.
Higher production volumes also saw cash operating costs increase by 5% overall, but fall by 4% on a per kilogram basis.
Gold prices, meanwhile, continued their steady ascent as volatile financial markets and geopolitical instability continue to push central bankers and investors to increase their reserves of the safe-haven metal.
DRDGold’s average received gold price was up 13% in the quarter, offsetting a 6% decline in sales volumes.
Price tailwinds, coupled with production growth, saw revenue rise by 6% to R2.96bn, while operating profit was 19% higher than the same period last year at R1.85bn.
The group reaffirmed full year production guidance of 140,000oz-150,000oz, and cash operating cost guidance.
The steady earnings growth comes amid fears the war in Iran might dent gold miners’ earnings by pressuring the price of bullion, which has fallen substantially as investors return to bonds in anticipation of rising inflation.
While the update points to steady earnings growth and price tailwinds, the price of gold remains under pressure as the US and Iran continue to navigate a fragile ceasefire.
Meanwhile, the cost of diesel continues to rise in South Africa thanks to the disruption of the Strait of Hormuz. Mining companies such as DRDGold may have to navigate significant cost inflation in the second quarter.
The group, a subsidiary of mining giant Sibanye-Stillwater, which specialises in recovering gold from leftover mining waste in Gauteng, has seen its share price fall by about 15% since the war began.
“The current gold price environment gives us an opportunity to continue to strengthen the business for the long term,” said DRDGold CEO Niël Pretorius.
“Our approach remains focused on disciplined reinvestment, extending the life of our assets and maintaining the financial resilience that allows us to remain competitive through the cycle.”
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