Modern Mining May 2020

MINING News

DRDGOLD’s Covid-19 production setback offset by higher gold price

In an operating update for the quarter ended 31 March 2020, DRDGOLD Limited (DRDGOLD; JSE, NYSE: DRD) reports an 18% quarter on quarter increase in adjusted EBITDA to R389,3-million, reflect- ing a 13% increase in the average Rand gold price received to R785 581/kg. The company’s Ergo and Far West Gold Recoveries operations were temporarily halted towards the end of the March quar- ter due to the national lockdown. While throughput was 4% down at 6 560 000 t and yield 9% down at

0,205 g/t, resulting in a 13% decline in gold production to 1 346 kg, gold sales were just 3% lower at 1 462kg due to the com- pany selling down inventory in anticipation of the lockdown. Although the cash operating cost per kg sold rose by 6% to R489 193, the cash operating cost per ton milled was stable at R101. All-in sustaining cost and all-in cost were both higher at R577 633/kg and R588 235/kg due mainly to an increase in capital expenditure.

Niël Pretorius, CEO of DRDGOLD.

Cash and cash equivalents increased by R1 291-million to R1 834,4-million, reflecting free cashflow from operations of R422,8- million and proceeds of R1 085,6-million from Sibanye-Stillwater’s share subscription. An interim dividend to shareholders totalling R213,6-million was paid during the quarter. External borrowings remained at zero. While production guidance initially pro- vided for the year to 30 June 2020 was between 175 000 and 190 000 oz, and the company subsequently advised that it was tracking the higher end of this, due to the impact of COVID-19 on the business to date and continuing uncertainty surrounding the pandemic, it is now expected that production will track the lower end.  Amplats ramps up ACP plant to restart production Anglo American Platinum has safely and successfully completed the repair of the Anglo Converter Plant (ACP) Phase B unit. At the time of writing, the ACP and full downstream processing operations were completing a safe ramp-up and expected to be fully operational from 12 May 2020. Force majeure to suppliers of concentrate was to be lifted on that date. “I am pleased to report that we have safely and successfully completed the repair of the ACP Phase B unit ahead of

6  MODERN MINING  May 2020