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DRD - Drdgold Limited - Report to shareholders for the 3rd quarter and nine
months ended 31 March 2012
DRDGOLD LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1895/000926/06)
JSE trading symbol: DRD
ISIN: ZAE000058723
Issuer code: DUSM
NYSE trading symbol: DRD
("DRDGOLD" or "the Group")
REPORT TO SHAREHOLDERS FOR THE 3rd QUARTER AND NINE MONTHS ENDED 31 MARCH 2012
GROUP RESULTS
KEY FEATURES FOR THE QUARTER
- Gold production from continuing operations up 3%
- Operating profit from continuing operations of R162.2 million
- Net cash inflow from operations of R141.5 million
- Crown/Ergo pipeline completed
- Construction of Ergo`s flotation/fine-grind circuit underway
- Blyvoor disposal on track
KEY RESULTS SUMMARY
GROUP Quarter Quarter % Quarter
Mar 2012 Dec 2011 Change Mar 2011
Gold production
Continuing operations oz 34 947 33 983 3 36 876
kg 1 087 1 057 3 1 147
Discontinued operations oz 25 946 29 676 (13) 30 511
kg 807 923 (13) 949
Group oz 60 893 63 659 (4) 67 387
kg 1 894 1 980 (4) 2 096
Gold production sold
Continuing operations oz 34 947 33 983 3 36 876
kg 1 087 1 057 3 1 147
Discontinued operations oz 25 946 29 676 (13) 30 511
kg 807 923 (13) 949
Group oz 60 893 63 659 (4) 67 387
kg 1 894 1 980 (4) 2 096
Cash operating costs
Continuing operations US$/oz 1 074 1 010 6 938
ZAR/kg 267 044 263 569 1 209 828
Discontinued operations US$/oz 1 391 1 245 12 1 263
ZAR/kg 346 875 326 677 6 279 920
Group US$/oz 1 209 1 118 8 1 090
ZAR/kg 301 059 292 988 3 241 563
Gold price received US$/oz 1 691 1 679 1 1 411
ZAR/kg 421 420 437 316 (4) 312 913
Capital expenditure US$ million 8.0 11.5 (30) 12.3
ZAR million 62.2 84.4 (26) 85.2
GROUP 9 mths to 9 mths to %
Mar 2012 Mar 2011 Change
Gold production
Continuing operations oz 103 492 108 701 (5)
kg 3 219 3 381 (5)
Discontinued operations oz 84 622 93 399 (9)
kg 2 632 2 905 (9)
Group oz 188 114 202 100 (7)
kg 5 851 6 286 (7)
Gold production sold
Continuing operations oz 105 453 110 147 (4)
kg 3 280 3 426 (4)
Discontinued operations oz 84 622 96 293 (12)
kg 2 632 2 995 (12)
Group oz 190 075 206 440 (8)
kg 5 912 6 421 (8)
Cash operating costs
Continuing operations US$/oz 1 075 945 14
ZAR/kg 263 614 215 158 23
Discontinued operations US$/oz 1 378 1 206 14
ZAR/kg 338 341 273 807 24
Group US$/oz 1 211 1 067 13
ZAR/kg 297 229 242 262 23
Gold price received US$/oz 1 702 1 328 28
ZAR/kg 417 832 301 363 39
Capital expenditure US$ million 29.4 31.5 (7)
ZAR million 224.5 222.2 1
STOCK
ISSUED CAPITAL
385 383 767 ordinary no par value shares
2 714 069 Treasury shares held within the group
5 000 000 cumulative preference shares
Total ordinary no par value shares issued and committed: 405 400 459
STOCK TRADED JSE NYSE*
Average volume for the quarter per day (000) 1 618 934
% of issued stock traded (annualised) 110 63
Price - High R6.28 US$0.816
- Low R4.46 US$0.528
- Close R5.58 US$0.746
*This data represents per share data and not per American Depositary
Share("ADS") data - one ADS reflects ten ordinary shares.
FORWARD-LOOKING STATEMENTS
Many factors could cause the actual results, performance or achievements of
DRDGOLD to be materially different from any future results, performance or
achievements that may be expressed or implied by such forward-looking statements
including among others, adverse changes or uncertainties in general economic
conditions in the markets DRDGOLD serves, a drop in the gold price, a sustained
strengthening of the Rand against the Dollar, regulatory developments adverse to
DRDGOLD or difficulties in maintaining necessary licences or other governmental
approvals, changes in DRDGOLD`s competitive position, changes in business
strategy, any major disruption in production at key facilities or adverse
changes in foreign exchange rates and various other factors.
These risks include, without limitation, those described in the section entitled
`Risk Factors` included in the annual report for the fiscal year ended 30 June
2011 which was filed with the United States Securities and Exchange Commission
on 28 October 2011 on Form 20-F. You should not place undue reliance on these
forward-looking statements, which speak only as of the date thereof. DRDGOLD
does not undertake any obligation to publicly update or revise these forward-
looking statements to reflect events or circumstances after the date of this
report or to the occurrence of unanticipated events. Any forward-looking
statements included in this report have not been reviewed and reported on by
DRDGOLD`s auditors.
OVERVIEW
Dear shareholder
The consolidation of the Crown and Ergo circuits is now complete enabling
greater operating efficiencies and enhancing our competitive advantage in the
Johannesburg area to access and treat tailings material. Over the twelve months
preceding the end of the quarter we constructed a 50-kilometre pipeline linking
the Crown Central footprint in Roodepoort to the Ergo plant. We also upgraded
the capacity of the Ergo plant to receive a total of 1.8 million tonnes of
material a month. We de-commissioned two reclamation sites, commissioned two new
sites and phased out production at both the Crown Central and City Deep plants
towards the end of the period.
In the past, we have experienced volatilities in recoveries and production every
time we have begun work on a new mine dump. As the events described above
happened simultaneously, we were apprehensive about the outcome. In the mega-
volume environment in which we operate, we have learned that, in spite of
thorough test-work, actual throughput results are the most critical measure.
We are therefore very pleased to report that Ergo and Crown combined (from this
point onwards referred to as "Ergo") achieved a 3% increase in production,
quarter on quarter.
We are also pleased that we managed this investment in capital infrastructure
without any dilution to shareholders and, in fact, repurchased 5.4 million
shares on the open market during February and March of this year, which we hold
in treasury to off-set the potential dilution of employees exercising share
options.
The disposal of DRDGOLD`s 74% interest in Blyvooruitzicht Gold Mining Company
Limited ("Blyvoor") to Village Main Reef Limited ("Village") continued during
the quarter under review.
At the time of writing this report, two conditions remained outstanding. These
involve the approval of the transaction by the Competition Commission and
finalising the terms of the acquisition of a block of ore from AngloGold
Ashanti. While it is not possible to predict how the Competition Commission
process will develop (the required submissions were filed on 29 March 2012), we
can confirm that the filing does not contain anything controversial or out of
the ordinary. In addition, our discussions with AngloGold Ashanti and Village
have been encouraging. I am comfortable reporting that it is highly likely that
we will have completed this condition by the due date of 30 May 2012.
The transaction itself is structured around three distinct events. The first
event is what we refer to as the "cash flow risk cutoff date" (1 February 2012).
This was the last day on which DRDGOLD could recover any portion of the
outstanding balance on the Blyvoor working capital loan facility. Similarly,
DRDGOLD had also warranted in favour of Village that, on the said date,
Blyvoor`s working capital balance would stand at Rnil. If there was a working
capital shortfall, DRDGOLD would pay that to Blyvoor. Any surplus would be paid
to DRDGOLD over time. As it turned out, the working capital surplus stood at
R64.8 million on the cash flow risk cutoff date. This amount will be recovered
from Blyvoor by the time the next key date ("Part A closure") arrives.
The deadline for Part A closure is 30 May 2012. It will, however, take effect as
soon as the two conditions referred to above are met. This date can also be
referred to as the "de-consolidation" date, since it will be the date on which
control of Blyvoor transfers, and its results are no longer consolidated.
The significance of the distinction between the cash flow risk cutoff date and
Part A closure is important. Although DRDGOLD is no longer exposed to the cash
flow requirements of Blyvoor, it still fully consolidates Blyvoor`s results
until such time as Part A closure arrives. Put differently, the financial
reports will still show the production and cost patterns of Blyvoor during this
period, including the impact of the substantial restructuring that is taking
place at the mine and the resulting effect on production.
The third significant date is the "conversion date". This is the date on which
the Department of Mineral Resources approves the conversion and thereafter,
transfer of the mining rights. This is the final closure date.
It is pleasing to report that, once again, the Group achieved a fatality-free
quarter.
Detailed operational review
Continuing operations ("Ergo")
Q3 2012 v Q2 2012
Gold production was 3% higher at 34 947oz due to a 7% increase in total
throughput to 5 613 000t, which reflected completion of the Crown/Ergo pipeline
and continued optimisation of this circuit. The average yield was 5% lower at
0.19g/t, a consequence of the depletion of higher-grade 4A11 sand dump material
reporting to the City Deep milling/pumping station.
Cash operating unit costs were contained to a 1% increase at R267 044/kg,
reflecting higher throughput and notwithstanding the impact of reagent price
increases, cyanide in particular.
Ergo achieved an operating profit of R162.2 million and spent R41.2 million on
capital, the last of the Crown/Ergo consolidation.
Q3 2012 v Q3 2011
Volume throughput for the quarter, compared to Q3 2011, increased by 12%. As we
are mining lower grades, this was reflected in total production, which was 5%
lower than last year.
Cash operating unit costs were up from R209 828/kg to R267 044/kg.
The higher Rand gold price pushed operating profit up from R120.0 million to
R162.2 million.
Cash operating margin per kilogram of gold produced increased by
R51 291/kg, up from R103 085/kg to R154 376/kg.
Capital expenditure was down 27%, from R56.5 million to R41.2 million.
Discontinued operation ("Blyvoor")
Q3 2012 v Q2 2012
We reported during the quarter that Blyvoor`s number 4 and 6 shafts did not
achieve the recovery trends which were envisaged in the draft business rescue
plan that was prepared by Blyvoor`s business rescue practitioner. We concluded
that the likelihood of a recovery at these shafts was remote and resolved to
suspend mining operations there.
This caused a 15% decline in Blyvoor`s underground production to
19 741oz, and an once-off retrenchment cost of R42.2 million. This cost was
incurred after 1 February.
Blyvoor saw a 5% decline in surface gold production to 6 204oz.
These trends and events resulted in a reduction in the quarter on quarter
operating profit from R98.6 million to R58.7 million. Capital expenditure was
37% lower at R21.0 million.
Q3 2012 v Q3 2011
Total cash operating unit costs were up 24%, the higher Rand gold price and
increased cash operating margin drove Blyvoor`s Q3 2012 operating profit up 135%
from R25.1 million to R58.7 million.
Zimbabwe
During the quarter, exploration drilling continued at the KT target at Gweru. At
John Bull, trenching has resulted in intersections of between 2 and 24g/t, and a
drilling programme is planned to determine the behavior of the reef at depth. At
Leny, additional trenching has been completed and sampling is pending; and at
Ascot, geophysics and geochem sampling will be carried out during the June
quarter. At Zhombe, geo-chemical analysis on a 50m x 50m staggered grid is
planned.
We are also carefully monitoring developments around the land lease regime that
has been proposed by the Zimbabwe Government and we are positioned to move
swiftly if these proposals are put in place.
Looking ahead
Construction of the R250 million Brakpan plant flotation and fine-grind circuit
has begun and is designed to push up gold production at Ergo by 16% to 20%.
We ended the quarter with cash and cash equivalents of R379.8 million and
therefore believe that we could also implement this project without any dilution
to shareholders.
A desktop study suggests that the fine-grind circuit may also bring uranium
recovery within reach and effect a by-product credit reduction in gold
production costs of between 5 and 8%. This assumes production of approximately
11 tonnes per month and a uranium spot price of US$50/lb. A full feasibility
study is currently under way to verify these assumptions and, among other
things, the estimated capital cost of R150 million.
While all this is happening we will continue to work on optimising our gold
circuit in pursuit of our objective to produce between 140 000 to 150 000oz pa;
at a cash cost of R260 000-R270 000/kg or US$1 000-US$1 100/oz; and with
maintenance capital of about R11 000/kg or U$42/oz.
NOTE REGARDING FINANCIAL INFORMATION
The condensed consolidated financial statements are prepared in accordance with
the recognition and measurement principles of International Financial Reporting
Standards ("IFRS") and South African Statements and interpretations of Generally
Accepted Accounting Practice (AC 500 Series). The accounting policies adopted
are in line with IFRS and are consistent with those applied in the annual
financial statements for the year ended 30 June 2011.
CONDENSED CONSOLIDATED Quarter Quarter Quarter
Statement of comprehensive income Mar 2012 Dec 2011 Mar 2011
R m R m R m
Unaudited Unaudited Unaudited
Continuing operations
Gold and silver revenue 458.3 462.8 360.0
Net operating costs (296.1) (274.1) (240.0)
Cash operating costs (290.3) (278.6) (240.8)
Movement in gold in process (5.8) 4.5 0.8
Operating profit 162.2 188.7 120.0
Depreciation (31.7) (30.6) (24.0)
Movement in provision for
environmental rehabilitation (9.8) (6.0) (7.9)
Retrenchment costs - - (0.4)
Net operating profit 120.7 152.1 87.7
Environmental rehabilitation costs (13.5) (9.3) (9.9)
Corporate, administration and
other expenses (32.5) (31.1) (18.4)
Share-based payments (0.8) (1.3) (0.8)
Net loss on financial liabilities
measured at amortised costs - (6.8) (1.0)
Finance income 5.9 5.4 4.8
Finance expenses (2.8) (1.5) (5.8)
Profit before taxation 77.0 107.5 56.6
Income tax (11.2) (8.6) (0.2)
Deferred tax (8.3) (25.8) (3.6)
Profit after taxation 57.5 73.1 52.8
Discontinued operations (Note 1)
Profit for the period from
discontinued operations 6.9 92.0 6.3
Net profit for the period 64.4 165.1 59.1
Attributable to:
Equity owners of the parent 49.9 125.3 48.1
Non-controlling interest 14.5 39.8 11.0
64.4 165.1 59.1
Other comprehensive income
Foreign exchange translation
and other 1.4 (0.6) -
Total comprehensive income for
the period 65.8 164.5 59.1
Attributable to
Equity owners of the parent 51.3 124.7 48.1
Non-controlling interest 14.5 39.8 11.0
65.8 164.5 59.1
Reconciliation of headline earnings
Net profit 49.9 125.3 48.1
Adjusted for
Non-controlling interest in headline
earnings adjustment - - -
Headline earnings 49.9 125.3 48.1
Headline earnings per share-cents
- From continuing operations 12 15 11
- From total operation 13 33 12
Basic earnings per share-cents
- From continuing operations 12 15 11
- From total operations 13 33 12
Diluted headline earnings
per share-cents 13 33 12
Diluted basic earnings
per share-cents 13 33 12
Calculated on the weighted average
ordinary shares issued of: 384 229 290 385 173 763 384 884 379
CONDENSED CONSOLIDATED 9 months to 9 months to
Statement of comprehensive income 31 Mar 2012 31 Mar 2011
R m R m
Unaudited Unaudited
Continuing operations
Gold and silver revenue 1 370.7 1 034.9
Net operating costs (863.3) (739.5)
Cash operating costs (848.6) (727.5)
Movement in gold in process (14.7) (12.0)
Operating profit 507.4 295.4
Depreciation (89.5) (70.5)
Movement in provision for environmental
rehabilitation (22.9) (16.9)
Retrenchment costs - (0.8)
Net operating profit 395.0 207.2
Environmental rehabilitation costs (37.3) (25.7)
Corporate, administration and other expenses (85.1) (52.8)
Share-based payments (2.5) (2.6)
Net loss on financial liabilities
measured at amortised costs (7.1) (13.7)
Profit on disposal of assets - 1.7
Finance income 16.7 17.2
Finance expenses (8.8) (15.4)
Profit before taxation 270.9 115.9
Income tax (25.6) (5.9)
Deferred tax (68.7) (35.3)
Profit after taxation 176.6 74.7
Discontinued operations (Note 1)
Profit for the period from discontinued operations 136.0 17.8
Net profit for the period 312.6 92.5
Attributable to:
Equity owners of the parent 250.6 80.0
Non-controlling interest 62.0 12.5
312.6 92.5
Other comprehensive income
Foreign exchange translation and other (1.8) -
Total comprehensive income for the period 310.8 92.5
Attributable to
Equity owners of the parent 248.8 80.0
Non-controlling interest 62.0 12.5
310.8 92.5
Reconciliation of headline earnings
Net profit 250.6 80.0
Adjusted for
Profit on disposal of assets - (1.7)
Non-controlling interest in headline
earnings adjustment - 0.4
Headline earnings 250.6 78.7
Headline earnings per share-cents
- From continuing operations 39 17
- From total operations 65 20
Basic earnings per share-cents
- From continuing operations 39 17
- From total operations 65 21
Diluted headline earnings
per share-cents 65 20
Diluted basic earnings
per share-cents 65 21
Calculated on the weighted average
ordinary shares issued of: 384 766 369 384 884 379
CONDENSED CONSOLIDATED As at As at As at
Statement of 31 Mar 2012 31 Dec 2011 31 Mar 2011
financial position R m R m R m
Unaudited Unaudited Unaudited
Assets
Non-Current assets 1 735.2 1 731.4 2 231.0
Property,plant and equipment 1 584.2 1 570.4 1 992.6
Non-current investments and other assets 10.8 10.8 24.8
Environmental rehabilitation trust funds 104.8 103.4 132.8
Deferred tax asset 35.4 46.8 80.8
Current assets 798.5 716.8 498.4
Inventories 81.6 89.7 95.5
Trade and other receivables 118.6 92.0 119.3
Cash and cash equivalents (Note 2) 379.8 320.9 268.6
Assets classified as held
for sale (Note 1) 218.5 214.2 15.0
Total assets 2 533.7 2 448.2 2 729.4
Equity and Liabilities
Equity 1 482.7 1 439.0 1 725.1
Equity of the owners of the parent 1 448.8 1 419.6 1 613.3
Non-controlling interest 33.9 19.4 111.8
Non-current liabilities 628.2 622.5 687.4
Loans and borrowings (Note 3) - - 73.8
Post-retirement and other
employee benefits 5.9 5.8 14.1
Provision for environmental
rehabilitation 464.9 456.2 449.8
Deferred tax liability 157.4 160.5 149.7
Current liabilities 422.8 386.7 316.9
Trade and other payables 239.9 209.1 238.1
Loans and borrowings (Note 3) 30.6 30.5 78.8
Liabilities classified
as held for sale (Note 1) 152.3 147.1 -
Total equity and liabilities 2 533.7 2 448.2 2 729.4
CONDENSED CONSOLIDATED Quarter Quarter Quarter
Statement of changes in equity Mar 2012 Dec 2011 Mar 2011
R m R m R m
Unaudited Unaudited Unaudited
Balance at the beginning of
the period 1 439.0 1 271.2 1 665.5
Share capital issued - 1.8 (0.3)
for share options exercised - 1.8 -
for costs - - (0.3)
Increase in share-based
payment reserve 0.8 1.5 0.8
Net profit attributed to
equity owners of the parent 49.9 125.3 48.1
Net profit attributed to
non-controlling interest 14.5 39.8 11.0
Treasury shares acquired (22.9) - -
Other comprehensive income 1.4 (0.6) -
Balance as at the end of the
period 1 482.7 1 439.0 1 725.1
CONDENSED CONSOLIDATED 9 months to 9 months to
Statement of changes in equity 31 Mar 2012 31 Mar 2011
R m R m
Unaudited Unaudited
Balance at the beginning of the period 1 219.2 1 649.9
Share capital issued 1.8 (0.7)
for share options exercised 1.8 -
for costs - (0.7)
Increase in share-based payment reserve 2.7 2.6
Net profit attributed to equity owners of the parent 250.6 80.0
Net profit attributed to non-controlling interest 62.0 12.5
Dividends declared (28.9) (19.2)
Treasury shares acquired (22.9) -
Other comprehensive income (1.8) -
Balance as at the end of the period 1 482.7 1 725.1
CONDENSED CONSOLIDATED Quarter Quarter Quarter
Statement of cash flows Mar 2012 Dec 2011 Mar 2011
R m R m R m
Unaudited Unaudited Unaudited
Net cash inflow from operations 141.5 243.9 120.4
Net cash outflow
from investing activities (67.8) (89.2) (85.2)
Net cash outflow from
financing activities (23.1) (119.4) (0.3)
Loans and other (0.2) (73.3) (0.3)
Treasury shares acquired (22.9) - -
Dividends paid to owners of the parent - (28.9) -
Dividends paid to non-controlling
interest holders - (17.2) -
Increase in cash and cash equivalents 50.6 35.3 34.9
Opening cash and cash equivalents 329.2 293.9 233.7
Closing cash and cash equivalents 379.8 329.2 268.6
Cash classified as assets held for
sale included in the closing balance - 8.3 -
Reconciliation of net cash inflow from operations
Profit before taxation 77.0 107.5 56.6
Profit from discontinued operations 6.9 92.0 8.2
83.9 199.5 64.8
Adjusted for:
Movement in gold process 7.0 (1.5) 4.4
Depreciation and impairments 33.4 31.7 32.7
Movement in provision for
environmental rehabilitation 10.8 4.6 7.8
Share-based payments 0.8 1.5 0.8
Net loss on financial liabilities
measured at amortised cost - 6.8 1.9
Finance expenses and unwinding of
provisions 2.3 2.9 2.6
Growth in environmental trust funds (1.9) (1.9) (1.7)
Other non-cash items 0.1 (1.2) (1.3)
Taxation paid (1.7) (8.5) -
Working capital changes 6.8 10.0 8.4
Net cash inflow from operations 141.5 243.9 120.4
CONDENSED CONSOLIDATED 9 months to 9 months to
Statement of cash flows 31 Mar 2012 31 Mar 2011
R m R m
Unaudited Unaudited
Net cash inflow from operations 503.3 220.9
Net cash out flow from investing activities (240.1) (220.5)
Net cash (out)/inflow from financing activities (142.5) 80.0
Loans and other (73.5) 130.9
Treasury shares acquired (22.9) -
Dividends paid to owners of the parent (28.9) (19.2)
Dividends paid to non-controlling interest holders (17.2) (31.7)
Increase in cash and cash equivalents 120.7 80.4
Opening cash and cash equivalents 259.1 188.2
Closing cash and cash equivalents 379.8 268.6
Cash classified as assets held for
sale included in the closing balance - -
Reconciliation of net cash inflow from operations
Profit before taxation 270.9 115.9
Profit from discontinuing operations 136.0 24.0
406.9 139.9
Adjusted for:
Movement in gold process 20.4 46.2
Depreciation and impairments 92.9 96.0
Movement in provision for environmental rehabilitation 22.7 17.3
Share-based payments 2.7 2.6
Net loss on financial liabilities
measured at amortised cost 7.1 16.4
Profit on disposal of assets - (1.7)
Finance expenses and unwinding of provisions 7.9 8.6
Growth in environmental trust funds (5.5) (5.6)
Other non-cash items (2.8) (2.4)
Taxation paid (10.2) (5.8)
Working capital changes (38.8) (90.6)
Net cash inflow from operations 503.3 220.9
Notes to the financial statements
Discontinued operations and assets held for sale
On 8 November 2011, DRDGOLD announced the acceptance of an EOI from Village for
the acquisition of DRDGOLD`s entire interest in and claims against Blyvoor for
R1 and 85 714 286 new ordinary shares of Village. Pursuant to the EOI, DRDGOLD,
Village and Business Venture Investments No 1557 (Pty) Ltd(a wholly owned
subsidiary of Village) ("Purchaser") entered into a sale of shares and claims
agreement on 11 February 2012.
Results from discontinued Quarter Quarter Quarter
operations Mar 2012 Dec 2011 Mar 2011
R m R m R m
Unaudited Unaudited Unaudited
Gold and silver revenue 339.9 403.1 295.9
Net operating costs (281.2) (304.5) (270.8)
Operating profit 58.7 98.6 25.1
Depreciation (1.8) (1.1) (8.7)
Movement in provision for
environmental rehabilitation (1.0) 1.4 0.1
Retrenchment costs (42.2) - -
Net operating profit 13.7 98.9 16.5
Other costs (6.8) (6.9) (8.3)
Profit before taxation 6.9 92.0 8.2
Taxation - - (1.9)
Profit after taxation 6.9 92.0 6.3
Cash flow (used in)/from discontinued operations
Net cash generated by operating
activities 20.2 93.7 24.6
Net cash used in investing activities (21.0) (33.2) (27.1)
Net cash (used in)/for the period (0.8) 60.5 (2.5)
Results from discontinued operations 9 months to 9 months to
31 Mar 2012 31 Mar 2011
R m R m
Unaudited Unaudited
Gold and silver revenue 1 099.5 900.2
Net operating costs (896.2) (829.6)
Operating profit 203.3 70.6
Depreciation (3.4) (25.5)
Movement in provision for
environmental rehabilitation 0.2 (0.4)
Retrenchment costs (42.2) -
Net operating profit 157.9 44.7
Other (21.9) (20.7)
Profit before taxation 136.0 24.0
Taxation - (6.2)
Profit after taxation 136.0 17.8
Cash flow from discontinued operations
Net cash generated by operating activities 134.8 71.1
Net cash used in investing activities (70.8) (67.8)
Net cash for the period 64.0 3.3
Cash and cash equivalents
Included in cash and cash equivalents is restricted cash of R117.3 million in
the form of guarantees mainly relating to environmental rehabilitation.
3. Loans and borrowings
Included in loans and borrowings is a Domestic Medium Term Note Programme ("DMTN
Programme") under which DRDGOLD may from time to time issue notes. R108 million
was issued on 1 October 2010, consisting of R78 million and R30 million
respectively, under the DMTN Programme and the different notes issued mature 12
and 24 months from the date of issue and bear interest at the three month
Johannesburg Inter-bank Acceptance Rate plus a margin ranging from 4% to 5% per
annum. The DMTN Programme is unsecured. During the previous quarter, DRDGOLD
repaid the amount of R78 million.
KEY OPERATING AND FINANCIAL RESULTS (Unaudited)
OPERATIONS Metric Metric Metric
Continuing Discontinued Total
operations operations* operations
Ore milled (`000t)
Underground Mar 12 Qtr - 135 135
Dec 11 Qtr - 191 191
Mar 12 Ytd - 510 510
Surface Mar 12 Qtr 5 613 711 6 324
Dec 11 Qtr 5 234 801 6 035
Mar 12 Ytd 16 078 2 295 18 373
Total Mar 12 Qtr 5 613 846 6 459
Dec 11 Qtr 5 234 992 6 226
Mar 12 Ytd 16 078 2 805 18 883
Yield (g/t)
Underground Mar 12 Qtr - 4.55 4.55
Dec 11 Qtr - 3.76 3.76
Mar 12 Ytd - 3.93 3.93
Surface Mar 12 Qtr 0.19 0.27 0.20
Dec 11 Qtr 0.20 0.25 0.21
Mar 12 Ytd 0.20 0.27 0.21
Total Mar 12 Qtr 0.19 0.95 0.29
Dec 11 Qtr 0.20 0.93 0.32
Mar 12 Ytd 0.20 0.94 0.31
Gold Produced (kg)
Underground Mar 12 Qtr - 614 614
Dec 11 Qtr - 719 719
Mar 12 Ytd - 2 002 2 002
Surface Mar 12 Qtr 1 087 193 1 280
Dec 11 Qtr 1 057 204 1 261
Mar 12 Ytd 3 219 630 3 849
Total Mar 12 Qtr 1 087 807 1 894
Dec 11 Qtr 1 057 923 1 980
Mar 12 Ytd 3 219 2 632 5 851
Cash operating costs (ZAR per kg)
Underground Mar 12 Qtr - 412 966 412 966
Dec 11 Qtr - 375 071 375 071
Mar 12 Ytd - 400 341 400 341
Surface Mar 12 Qtr 267 044 136 617 247 378
Dec 11 Qtr 263 569 156 113 246 186
Mar 12 Ytd 263 614 141 319 243 597
Total Mar 12 Qtr 267 044 346 875 301 059
Dec 11 Qtr 263 569 326 677 292 988
Mar 12 Ytd 263 614 338 341 297 229
Cash operating costs (ZAR per tonne)
Underground Mar 12 Qtr - 1 878 1 878
Dec 11 Qtr - 1 412 1 412
Mar 12 Ytd - 1 572 1 572
Surface Mar 12 Qtr 52 37 50
Dec 11 Qtr 53 40 51
Mar 12 Ytd 53 39 51
Total Mar 12 Qtr 52 331 88
Dec 11 Qtr 53 304 93
Mar 12 Ytd 53 317 92
Gold and silver revenue (ZAR million)
Mar 12 Qtr 458.3 339.8 798.1
Dec 11 Qtr 462.8 403.1 865.9
Mar 12 Ytd 1 370.7 1 099.5 2 470.2
Operating profit (ZAR million)
Mar 12 Qtr 162.2 58.7 220.9
Dec 11 Qtr 188.7 98.6 287.3
Mar 12 Ytd 507.4 203.3 710.7
Capital expenditure (ZAR million)
Mar 12 Qtr 41.2 21.0 62.2
Dec 11 Qtr 51.2 33.2 84.4
Mar 12 Ytd 153.7 70.8 224.5
OPERATIONS Imperial Imperial Imperial
Continuing Discontinued Total
operations operations* operations
Ore milledd (`000t)
Underground Mar 12 Qtr - 149 149
Dec 11 Qtr - 210 210
Mar 12 Ytd - 562 562
Surface Mar 12 Qtr 6 188 784 6 970
Dec 11 Qtr 5 769 883 6 652
Mar 12 Ytd 17 721 2 530 20 251
Total Mar 12 Qtr 6 188 933 7 119
Dec 11 Qtr 5 769 1 093 6 862
Mar 12 Ytd 17 721 3 092 20 813
Yield (oz/t)
Underground Mar 12 Qtr - 0.132 0.132
Dec 11 Qtr - 0.110 0.110
Mar 12 Ytd - 0.115 0.115
Surface Mar 12 Qtr 0.006 0.008 0.006
Dec 11 Qtr 0.006 0.007 0.006
Mar 12 Ytd 0.006 0.008 0.006
Total Mar 12 Qtr 0.006 0.028 0.009
Dec 11 Qtr 0.006 0.027 0.009
Mar 12 Ytd 0.006 0.027 0.009
Gold Produced (oz)
Underground Mar 12 Qtr - 19 741 19 741
Dec 11 Qtr - 23 117 23 117
Mar 12 Ytd - 64 367 64 367
Surface Mar 12 Qtr 34 947 6 205 41 152
Dec 11 Qtr 33 983 6 559 40 542
Mar 12 Ytd 103 492 20 255 123 747
Total Mar 12 Qtr 34 947 25 946 60 893
Dec 11 Qtr 33 983 29 676 63 659
Mar 12 Ytd 103 492 84 622 188 114
Cash operating costs (USD per oz)
Underground Mar 12 Qtr - 1 657 1 657
Dec 11 Qtr - 1 429 1 429
Mar 12 Ytd - 1 630 1 630
Surface Mar 12 Qtr 1 074 547 994
Dec 11 Qtr 1 010 597 940
Mar 12 Ytd 1 075 576 992
Total Mar 12 Qtr 1 074 1 391 1 209
Dec 11 Qtr 1 010 1 245 1 118
Mar 12 Ytd 1 075 1 378 1 211
Cash operating costs (USD per tonne)
Underground Mar 12 Qtr - 219 219
Dec 11 Qtr - 157 157
Mar 12 Ytd - 187 187
Surface Mar 12 Qtr 6 4 6
Dec 11 Qtr 6 4 6
Mar 12 Ytd 6 5 6
Total Mar 12 Qtr 6 39 10
Dec 11 Qtr 6 34 10
Mar 12 Ytd 6 38 11
Gold and silver revenue (USD million)
Mar 12 Qtr 59.3 43.5 102.8
Dec 11 Qtr 57.1 49.9 107.0
Mar 12 Ytd 179.7 143.7 323.4
Operating profit (USD million)
Mar 12 Qtr 21.1 7.5 28.6
Dec 11 Qtr 23.4 12.6 36.0
Mar 12 Ytd 66.5 26.6 93.1
Capital expenditure (USD million)
Mar 12 Qtr 5.3 2.7 8.0
Dec 11 Qtr 7.3 4.2 11.5
Mar 12 Ytd 20.2 9.2 29.4
CASH OPERATING COSTS RECONCILIATION
(R`000 unless otherwise stated)
OPERATIONS Continuing Discontinued Total
operations operations* operations
Total cash costs
Mar 12 Qtr 330 759 330 400 674 714
Dec 11 Qtr 305 009 311 802 629 403
Mar 12 Ytd 1 005 069 960 446 1 954 653
Movement in gold in process
Mar 12 Qtr (5 870) (1 202) (7 072)
Dec 11 Qtr 4 577 (3 041) 1 536
Mar 12 Ytd (14 720) (5 732) (20 452)
Less: Assessment rates, rehabilitation and other
Mar 12 Qtr 25 664 2 597 29 756
Dec 11 Qtr 21 966 2 533 26 361
Mar 12 Ytd 114 759 8 153 87 130
Less: Retrenchment costs
Mar 12 Qtr - 42 170 42 170
Dec 11 Qtr - - -
Mar 12 Ytd - 42 170 42 170
Less: Corporate and general administration costs
Mar 12 Qtr 8 948 4 503 25 511
Dec 11 Qtr 9 028 4 705 24 462
Mar 12 Ytd 27 018 13 877 65 813
Cash operating costs
Mar 12 Qtr 290 277 279 928 570 205
Dec 11 Qtr 278 592 301 523 580 166
Mar 12 Ytd 848 572 890 514 1 739 088
Gold produced - kg
Mar 12 Qtr 1 087 807 1 894
Dec 11 Qtr 1 057 923 1 980
Mar 12 Ytd 3 219 2 632 5 851
Total cash operating costs - R/kg
Mar 12 Qtr 267 044 346 875 301 059
Dec 11 Qtr 263 569 326 677 292 988
Mar 12 Ytd 263 614 338 341 297 229
Total cash operating costs - USD/oz
Mar 12 Qtr 1 074 1 391 1 209
Dec 11 Qtr 1 010 1 245 1 118
Mar 12 Ytd 1 075 1 378 1 211
*Discontinued operations represent Blyvoor.
DIRECTORS - (*British)(**American)
Executive:
DJ (Niel) Pretorius (Chief Executive Officer)
CC Barnes (Chief Financial Officer)
Independent non-executives:
GC Campbell*(Non-Executive Chairman); RP Hume; EA Jeneker; J Turk **
Company Secretary:
TJ Gwebu
INVESTOR RELATIONS
For further information, contact Niel Pretorius at:
Tel: (+27)(0)11 470 2600, Fax: (+27) (0)11 470 2618,
Website: http://www.drdgold.com
Quadrum Office Park, 50 Constantia Boulevard,
Constantia Kloof Ext 28, South Africa.
PO Box 390,
Maraisburg, 1700,
South Africa.
Roodepoort
26 April 2012
JSE LIMITED SPONSOR
One Capital
Date: 26/04/2012 08:00:04 Supplied by www.sharenet.co.za
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