DRDGold’s production decreased by 5% quarter-on-quarter in the second quarter ended December 31, primarily as a result of an 8% drop in tonnage throughput.
The lower throughput from Ergo Mining, a joint venture between DRDGold and Mintails, was mainly the result of power interruptions experienced over 11 days during the second quarter, caused by a fire at an Eskom substation, a lightning strike on the Brakpan tailings complex transformer yard and load-shedding by the Johannesburg metropolitan municipality.
Meanwhile, early-stage commissioning of the company’s new Far West Gold Recoveries (FWGR) project started on December 6, 2018. The project is expected to start contributing to overall production in the second half of the financial year to June 30, 2019.
FINANCIAL PERFORMANCE
DRDGold expects to report a loss a share of 5.8c to 8.6c for the six months ended December 31.
This compares with earnings a share of 14.4c for the six months to December 31, 2017.
It also expects to report a headline loss a share of 5.8c to 8.7c for the six months under review, compared with headline earnings a share of 14.3c for the prior comparable period.
The expected decrease in earnings and headline earnings a share are primarily owing to the costs incurred for the commissioning and start of the FWGR, as well as a 3% year-on-year decrease in gold production.