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DRD
DRDD
DRD - DRDGOLD Limited - Unaudited group results for the quarter and nine months
ended 31 March 2008
DRDGOLD LIMITED
(Incorporated in the Republic of South Africa)
(Registration number 1895/000926/06)
JSE share code: DRD
ISIN: ZAE000058723
Issuer code: DUSM
Nasdaq trading symbol: DROO
("DRDGOLD" or "the company")
UNAUDITED GROUP RESULTS FOR THE QUARTER AND NINE MONTHS ENDED 31 MARCH 2008
KEY FEATURES
- Safety - fatality free quarter
- Cash operating profit up 199% from R47.6 million to R142.2 million
- Cash operating costs down 3% from R369.3 million to R356.4 million
- Headline profit up from R9.2 million to R103.3 million
- Strong balance sheet supports current and future growth
KEY RESULTS SUMMARY
GROUP Quarter Quarter % Quarter
Mar 08 Dec 07 Change Mar 07
Gold production
South African operations oz 70 378 77 259 (9) 75 330
kg 2 189 2 403 (9) 2 343
Discontinued operation oz - 3 394 (100) 28 437
kg - 106 (100) 884
Group oz 70 378 80 653 (13) 103 767
kg 2 189 2 509 (13) 3 227
Cash operating costs
South African operations US$/oz 667 703 5 572
ZAR/kg 162 806 153 690 (6) 133 492
Discontinued operation US$/oz - 1 336 100 707
ZAR/kg - 281 613 100 164 963
Group US$/oz 667 730 9 606
ZAR/kg 162 806 159 094 (2) 141 449
Gold price received US$/oz 943 797 18 663
ZAR/kg 228 836 173 606 32 154 629
Capital expenditure US$ million 4.7 6.7 30 9.0
ZAR million 35.6 45.3 21 65.9
Average exchange rate ZAR:US$ 7.55 6.78 (11) 7.25
9 months to 9 months to
31 Mar 08 31 Mar 07
Gold production
South African operations oz 236 794 253 991
kg 7 365 7 900
Discontinued operation oz 13 427 132 099
kg 417 4 106
Group oz 250 221 386 090
kg 7 782 12 006
Cash operating costs
South African operations US$/oz 647 524
ZAR/kg 148 863 122 288
Discontinued operation US$/oz 1 098 624
ZAR/kg 252 775 145 590
Group US$/oz 672 558
ZAR/kg 154 431 130 257
Gold price received US$/oz 796 633
ZAR/kg 182 993 147 652
Capital expenditure US$ million 16.5 34.7
ZAR million 117.4 252.0
Average Exchange Rate ZAR:US$ 7.15 7.26
STOCK
ISSUED CAPITAL
376 432 389 ordinary no par value shares
5 000 000 cumulative preference shares
Total ordinary no par value shares issued and committed: 392 700 599
STOCK TRADED JSE NASDAQ
Avg. volume for the quarter per day (000) 1 873 4 101
% of issued stock traded(annualised) 130 284
Price - High R10.25 US$1.352
- Low R5.05 US$0.714
- Close R8.25 US$0.980
FORWARD LOOKING STATEMENTS
Many factors could cause the actual results, performance or achievements to be
materially different from any future results, performance or achievements that
many 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 continuing 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 limitations, those described in the section
entitled "Risk Factors" included in the annual report for the fiscal year ended
30 June 2007, which was filed with the United States Securities and Exchange
Commission on 14 December 2007 on Form 20-F. Shareholders 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 on the occurrence of unanticipated events.
OVERVIEW
Dear shareholder
Safety
I am pleased and encouraged to be able to report that the operations of DRDGOLD
recorded a quarter free of fatalities. However, on an operation by operation
examination of other key safety indicators - Dressing Station Injury Frequency
Rate ("DSIFR"), Disabling Injury Frequency Rate ("DIFR") and Reportable Injury
Frequency Rate ("RIFR") - it shows generally a poorer performance. This demands
continuous, unrelenting attention by both management and employees.
As previously reported, research has shown behaviour to be a major cause of
accidents. In response to this, operational management is engaging with
employees and their representatives, as well as contractors and their employees,
to secure buy-in for the design and piloting of a behaviour-based safety
programme at Blyvoor. Successful implementation at Blyvoor will be followed by a
roll-out of the programme to the other operations.
Production
Gold production from continued operations was 9% lower at 70 378 oz, due both to
the negative impact of Eskom power cuts in January at the underground operations
and to a significant drop in underground grade at ERPM, which is reported in
more detail below. We estimate that, had it not been for the power cuts, our
operations would have produced an additional 3 000 ounces.
Financial
Group revenue was 20% higher at R498.6 million, a consequence of a 32% increase
in the average gold price received to R228 836/kg. After accounting for cash
operating unit costs, which were 2% higher at R162 806/kg, cash operating profit
was 199% higher at R142.2 million.
Corporate and Board Appointments
I am pleased to announce the appointment of Craig Barnes as Chief Financial
Officer ("CFO") and an Executive Director of DRDGOLD. Craig was previously Chief
Financial Officer of DRDGOLD South African Operations (Pty) Limited ("DRDGOLD
SA"). Kobus Dissel, who has been DRDGOLD CFO in an acting capacity, continues as
Financial Manager: Corporate Services.
Niel Pretorius, Chief Executive Officer of DRDGOLD SA, has been appointed
Managing Director (South Africa) for DRDGOLD.
Looking ahead
For so long as South Africa`s current power dilemma continues, it will be
difficult to anticipate operational performance going forward. However, provided
that Eskom is able to continue to supply power at 95% of its previous level, and
to continue to give notice of impending cuts, we remain optimistic that - all
other operational factors remaining stable - we will be able to maintain current
production levels.
The afore-mentioned decline in underground grade at ERPM is an unfortunate
reversal; the pattern of declining production and rising costs over a number of
quarters simply cannot be allowed to continue. As previously reported,
management anticipates a re-organisation and right-sizing of ERPM`s underground
operations. In compliance with the requirements of the Labour Relations Act, a
60-day facilitated process of formal consultation with representative unions has
begun.
It is fortuitous that the afore-mentioned reversals come at a time of gold price
buoyancy, but we are conscious that we cannot fall into complacency and that our
drive to return the South African operations to sustainable stability must
continue apace. Further, we must continue to pursue growth, both in terms of our
various brownfields underground projects and surface retreatment.
In our view we have complied with all the requirements for a mining licence to
mine the Top Star dump. We enquire on a weekly basis regarding the progress of
our application and still await a positive response from the Department of
Minerals and Energy ("DME").
It is pleasing to report, in closing that, at the Ergo JV with Mintails, Phase 1
refurbishment of the Brakpan plant is on track, the site establishment plan for
the recovery of the Benoni dump has been finalised, preparations for the
installation of the necessary pipelines have begun, and the rehabilitation
contract for the Brakpan tailings facility has been awarded. In respect of Phase
2, a specialist process engineer has been appointed in an overseeing capacity,
consultants have been appointed to conduct uranium and sulphuric acid
feasibility studies and dump evaluation continues.
John Sayers
Chief Executive Officer
NOTE REGARDING FINANCIAL INFORMATION
The condensed consolidated financial statements below are prepared in accordance
with International Financial Reporting Standards ("IFRS").
CONSOLIDATED INCOME STATEMENT Quarter Quarter Quarter
(Unaudited) Mar 08 Dec 07 Mar 07
Rm Rm Rm
Continuing operations
Gold and silver revenue 498.6 416.9 356.2
Cash operating costs (356.4) (369.3) (312.8)
Cash operating profit 142.2 47.6 43.4
Administration and general
other costs (21.3) (17.7) (21.5)
Share-based payments (0.3) (0.9) (2.0)
Care and maintenance costs (2.3) (2.8) (3.2)
Profit from operations 118.3 26.2 16.7
Retrenchment costs - (5.1) (0.8)
Investments income 27.5 15.4 4.8
Finance expenses (4.7) (4.8) (2.7)
Net operating profit 141.1 31.7 18.0
Rehabilitation (4.7) (4.8) (3.1)
Depreciation (18.4) (19.9) (18.6)
Loss on financial instruments - (0.8) -
Movement in gold process (0.1) 1.3 (1.0)
Profit/(loss) before taxation 117.9 7.5 (4.7)
Taxation (13.6) (3.5) (0.2)
Profit/(loss) after taxation 104.3 4.0 (4.9)
Discontinued operations
(Loss)/profit for the period from
discontinued operations (1.3) 6.6 (83.3)
Profit on sale of investments 30.3 118.3 90.6
Impairment from discontinued
operations (1.3) (44.4) (3.9)
Net profit/(loss) for the period 132.0 84.5 (1.5)
Attributable to:
Minority interest 27.6 (8.7) 3.5
Ordinary shareholders of the
company 104.4 93.2 (5.0)
132.0 84.5 (1.5)
Headline profit/(loss) per share-cents
from continuing operations 27.7 1.1 (2.2)
from total operations 27.5 2.4 (21.2)
Basic profit/(loss) per share-cents
from continuing operations 27.7 1.1 (2.2)
from total operations 27.7 24.8 (1.4)
Calculated on the weighted average
ordinary shares issued of: 376 228 788 376 141 981 345 510 540
Diluted headline profit/(loss)
per share-cents 27.5 2.4 (21.2)
Diluted basic profit/(loss)
per share-cents 27.7 24.8 (1.4)
CONSOLIDATED INCOME STATEMENT 9 months to 9 months to
(Unaudited) 31 Mar 08 31 Mar 07
Rm Rm
Gold and silver revenue 1 348.5 1 153.0
Cash operating costs (1 096.4) (966.1)
Cash operating profit 252.1 186.9
Administration and general other costs (61.8) (85.8)
Share-based payments (0.7) (5.9)
Care and maintenance costs (7.6) (8.1)
Profit from operations 182.0 87.1
Retrenchment costs (6.2) (0.9)
Investments income 40.6 14.1
Finance expenses (17.9) (33.4)
Net operating profit 198.5 66.9
Rehabilitation (14.2) (9.3)
Depreciation (58.0) (53.1)
Loss on financial instruments (0.8) -
Movement in gold process 0.6 0.4
Profit before taxation 126.1 4.9
Taxation (17.1) (0.5)
Profit after taxation 109.0 4.4
Profit/(loss)on sale of investment 12.0 (7.8)
Impairments - 15.6
Discontinued operations
Loss for the period from discontinued operations (51.3) (319.2)
Profit on sale of investments 1 156.6 90.6
Impairment from discontinued operations (45.7) (787.0)
Net profit/(loss) for the period 1 180.6 (1 003.4)
Attributable to:
Minority interest 225.9 (204.9)
Ordinary shareholders of the company 954.7 (798.5)
1 180.6 (1 003.4)
Headline profit/(loss) per share-cents
from continuing operations 29.0 1.3
from total operations 18.3 (74.4)
Basic profit/(loss) per share-cents
from continuing operations 32.2 3.7
from total operations 254.0 (240.6)
Calculated on the weighted average
ordinary shares issued of: 375 852 976 331 852 870
Diluted headline profit/loss per share-cents 18.3 (74.4)
Diluted basic profit/(loss)per share-cent 254.0 (240.6)
CONDENSED CONSOLIDATED BALANCE SHEET As at As at As at
(Unaudited) 31 Mar 08 31 Dec 07 31 Mar 07
Rm Rm Rm
Assets
Property, plant and equipment 669.1 652.3 704.6
Investments 57.7 57.7 62.0
Environmental rehabilitation trust funds 86.6 82.8 71.1
Current assets 1 050.6 956.6 1 170.4
Inventories 51.0 69.2 99.6
Trade and other receivables 186.5 123.2 66.5
Financial assets - - 10.7
Cash and cash equivalents 790.4 749.2 108.3
Assets classified as held for sale 22.7 15.0 885.3
1 864.0 1 749.4 2 008.1
Equity and Liabilities
Equity 1 248.6 1 130.2 239.8
Shareholders equity 1 186.1 1 083.5 204.9
Minority shareholders` interest 62.5 46.7 34.9
Long-term liabilities 49.2 49.2 130.2
Post retirement and other employee benefits 22.1 21.5 21.6
Provision for environmental rehabilitation 296.9 288.3 276.0
Deferred mining and income taxes - - 101.6
Current liabilities 247.2 260.2 1 238.9
Trade and other liabilities 247.2 260.2 346.2
Financial liabilities - - 240.9
Current portion of long-term liabilities - - 530.6
Liabilities classified as held for sale - - 121.2
1 864.0 1 749.4 2 008.1
CONDENSED CONSOLIDATED Quarter Quarter Quarter
STATEMENT OF CHANGES IN EQUITY Mar 08 Dec 07 Mar 07
(Unaudited) Rm Rm Rm
Balance at the beginning
of the period 1 130.2 1 251.8 109.5
Share capital issued 1.6 0.9 142.5
for acquisition finance and cash - - 141.4
for share options exercised 1.6 - -
for increase in share-based
payment reserve 0.3 0.9 2.0
for costs (0.3) - (0.9)
Net profit/(loss) attributed to
ordinary shareholders 104.4 93.2 (5.0)
Net profit/(loss) attributed to
minority shareholders 27.6 (8.7) 3.5
Decrease in minorities (37.2) (152.1) -
Currency translation
adjustments and other 22.0 (54.9) (10.7)
Balance as at the
end of the period 1 248.6 1 130.2 239.8
Reconciliation of headline profit/(loss)
Net profit/(loss) 104.4 93.2 (5.0)
Adjusted for:
Impairment from discontinued
Operations 1.3 44.4 3.9
Minority share of impairment from
Discontinued operations (0.2) (9.5) (0.8)
Profit on sale of discontinued
operations (30.3) (118.3) (90.6)
Minority share of profit on
sale of investments 28.1 (0.6) 19.3
Headline profit/(loss) 103.3 9.2 (73.2)
CONDENSED CONSOLIDATED 9 months to 9 months to
STATEMENT OF CHANGES IN EQUITY 31 Mar 08 31 Mar 07
(Unaudited) Rm Rm
Balance at the beginning of the period 143.5 1 015.3
Share capital issued 29.1 268.7
for acquisition finance and cash 28.0 269.6
for share options exercised 1.6 1.0
for increase in share-based payment reserve 0.7 5.9
for costs (1.2) (7.8)
Net profit/(loss) attributed to
ordinary shareholders 954.7 (798.5)
Net profit/(loss) attributed to
minority shareholders 225.9 (204.9)
(Decrease)/increase in minorities (189.3) 18.5
Currency translation adjustments and other 84.7 (59.3)
Balance as at the end of the period 1 248.6 239.8
Reconciliation of headline profit/(loss)
Net profit/(loss) 954.7 (798.5)
Adjusted for:
Impairments - (15.6)
Impairment from discontinued operations 45.7 787.0
Minority share of impairment from
discontinued operations (9.7) (205.2)
Profit on sale of discontinued operations (1 156.6) (90.6)
Minority share of profit on sale of investments 246.5 68.2
(Profit)/loss on sale of investments (12.0) 7.8
Headline profit/(loss) 68.6 (246.9)
CONDENSED CONSOLIDATED Quarter Quarter Quarter
CASH FLOW STATEMENT Mar 08 Dec 07 Mar 07
(Unaudited) Rm Rm Rm
Net cash in/(out)flow
from operations 137.5 13.3 (15.8)
Working capital changes (85.7) (373.5) (64.5)
Net cash (out)/in flow from
investing activities (36.0) 240.9 (73.2)
Net cash in/(out)flow from
financing activities 1.6 20.1 113.5
Increase/(decrease) in
cash and cash equivalents 17.4 (99.2) (40.0)
Translation adjustment 23.8 (48.9) (2.2)
Opening cash and cash equivalents 749.2 897.3 168.7
Closing cash and cash equivalents 790.4 749.2 126.5
Cash classified as assets held
for sale included in the
closing balance - - 18.2
Reconciliation of net cash in/(out) flow from operations
Net operating profit 141.1 31.7 18.0
Net operating loss from
discontinued operations (3.1) (25.7) (24.6)
138.0 6.0 (6.6)
Adjusted for:
Interest provision - (3.9) -
Financial instruments - 1.8 21.0
Unrealised foreign exchange
loss/(gain) (3.3) 4.2 (7.9)
Growth in Environmental Trust funds (3.8) (2.0) (2.2)
Other non cash items 6.8 8.4 1.3
Interest paid (0.2) (1.6) (20.2)
Taxation paid - 0.4 (1.2)
Net cash in/(out)flow
from operations 137.5 13.3 (15.8)
CONDENSED CONSOLIDATED 9 months to 9 months to
CASH FLOW STATEMENT 31 Mar 08 Mar 07
(Unaudited) Rm Rm
Net cash in/(out) flow from operations 115.7 (111.5)
Working capital changes (733.8) 63.9
Net cash in/(out)flow from investing activities 2 075.3 (251.1)
Net cash out flow from financing activities (1 037.9) (51.5)
Increase/(decrease) in cash and cash equivalents 419.3 (350.2)
Translation adjustment 233.4 (12.3)
Opening cash and cash equivalents 137.7 489.0
Closing cash and cash equivalents 790.4 126.5
Cash classified as assets held
for sale included in the closing balance - 18.2
Reconciliation of net cash in/(out) flow from operations
Net operating profit 198.5 66.9
Net operating loss from discontinued operations (110.2) (168.1)
88.3 (101.2)
Adjusted for:
Amortisation of convertible cost - 3.5
Financial instruments 1.2 48.9
Unrealised foreign exchange loss/(gain) 39.0 (1.3)
Growth in Environmental Trust funds (10.8) (5.3)
Other non cash items 56.9 41.5
Interest paid (36.0) (76.7)
Taxation paid (22.9) (20.9)
Net cash outflow from operations 115.7 (111.5)
KEY OPERATING AND FINANCIAL RESULTS (Unaudited)
SOUTH AFRICAN OPERATIONS
Blyvoor Quarter Quarter % Quarter
Mar 08 Dec 07 Change Mar 07
Ore milled
Underground t`000 155 164 ( 5) 141
Surface t`000 946 937 1 900
Total t`000 1 101 1 101 - 1 041
Yield
Underground g/t 4.48 4.80 (7) 4.97
Surface g/t 0.33 0.30 10 0.38
Total g/t 0.91 0.97 (6) 1.00
Gold produced
Underground oz 22 312 25 302 (12) 22 538
kg 694 787 (12) 701
Surface oz 10 031 9 131 10 11 092
kg 312 284 10 345
Total oz 32 343 34 433 (6) 33 630
kg 1 006 1 071 (6) 1 046
Cash operating costs
Underground US$/oz 814 823 1 714
ZAR/kg 198 768 179 621 (11) 166 572
ZAR/t 890 862 (3) 828
Surface US$/oz 350 418 16 265
ZAR/kg 85 026 91 415 7 61 855
ZAR/t 28 28 - 24
Total US$/oz 670 715 6 566
ZAR/kg 163 492 156 232 (5) 132 033
ZAR/t 149 152 2 133
Cash operating profit
US$ m 8.7 2.9 200 2.9
ZAR m 63.7 19.6 225 20.9
Capital expenditure (net)
US$ m 2.1 2.5 16 2.0
ZAR m 15.5 17.0 9 14.8
9 months to 9 months to
31 Mar 08 31 Mar 07
Ore milled
Underground t`000 513 506
Surface t`000 2 739 2 762
Total t`000 3 252 3 268
Yield
Underground g/t 4.79 5.07
Surface g/t 0.31 0.34
Total g/t 1.02 1.08
Gold produced
Underground oz 78 961 82 435
kg 2 456 2 564
Surface oz 27 650 30 543
kg 860 950
Total oz 106 611 112 978
kg 3 316 3 514
Cash operating costs
Underground US$/oz 758 635
ZAR/kg 174 333 148 034
ZAR/t 835 750
Surface US$/oz 390 289
ZAR/kg 89 581 67 386
ZAR/t 28 23
Total US$/oz 663 541
ZAR/kg 152 353 126 231
ZAR/t 155 136
Cash operating profit US$ m 14.4 9.6
ZAR m 103.3 69.3
Capital expenditure (net)US$ m 6.5 7.0
ZAR m 46.2 50.8
Total gold production was 6% lower at 32 343 oz, a consequence mainly of the
impact of Eskom power cuts in January on underground gold production, which was
12% lower at 22 312 oz. Surface production increased by 10% to 10 031 oz.
Underground throughput was 5% down at 155 000 t, a consequence of five
production days lost due to power outages. Full production was restored only
after nine days. Underground yield was 7% lower at 4.48 g/t.
Higher gold production from surface sources resulted mainly from a 10% increase
in yield to 0.33 g/t. Surface throughput was 1% higher at 946 000 t.
Total cash operating unit costs were 6% lower at US$670/oz. This reflects a 1%
decrease in underground cash operating unit costs to US$814/oz due mainly to
lower consumption of stores and lower overtime paid, and a 16% decrease in
surface cash operating unit costs, arising from higher gold production.
Cash operating profit was 225% higher at R63.7 million, reflecting both an
increase in the average gold price received and a deterioration of the South
African Rand ("Rand") against the United States Dollar ("US Dollar").
Capital expenditure for the quarter of R15.5 million was directed mainly towards
the cost of the Way Ahead Project raise boring.
First production from the Way Ahead Project is on track for the September
quarter. The first raise borehole between 31 and 33 levels has been completed
and work on the second, between 27 and 31 levels is scheduled for completion by
the end of July.
Drilling of the first exploration hole in the southern extension of the mine`s
lease area has begun.
At No 6 Shaft, work has begun on the 15/29 Incline Project. Some R3.5 million
will be spent to open up Main Reef and Carbon Leader reserves of some 540
000mSquared with a recovered grade averaging 4.8 g/t. Mining at a rate of 12 000
t per month, the project has an estimated life of 10 years. Production is
expected to begin during the last quarter of calendar 2008 at a rate of 1 000 t
per month, rising to 12 000 t per month over the ensuing 12 months.
The mine continues to operate at full production currently, well within the 95%
power consumption limit agreed with Eskom. Savings are achieved by cutting power
supply to the mine village for four hours a day, shutting down underground
compressors between 16:00 and 21:00 daily and re-scheduling pumping to off-peak
periods.
Crown Quarter Quarter % Quarter
Mar 08 Dec 07 Change Mar 07
Ore milled t`000 1 919 2 138 (10) 2 011
Yield g/t 0.34 0.30 13 0.36
Gold produced oz 20 673 20 737 - 23 180
kg 643 645 - 721
721
Cash operating costs
US$/oz 557 617 10 491
ZAR/kg 135 855 134 798 (1) 114 423
ZAR/t 46 41 (12) 41
Cash operating profit
US$ m 8.3 3.6 131 3.8
ZAR m 60.4 24.6 146 27.5
Capital expenditure (net)
US$ m 0.4 0.3 (33) 1.2
ZAR m 2.5 2.2 (14) 9.0
9 months to 9 months to
31 Mar 08 31 Mar 07
Ore milled t`000 6 204 6 298
Yield g/t 0.33 0.40
Gold produced oz 65 781 80 344
kg 2 046 2 499
Cash operating costs US$/oz 560 434
ZAR/kg 128 842 101 174
ZAR/t 42 40
Cash operating profit US$ m 16.0 15.5
ZAR m 114.3 112.6
Capital expenditure (net)US$ m 0.9 2.7
ZAR m 6.2 19.9
Gold production was steady at 20 673 oz. While average yield increased by 13% to
0.34 g/t, reflecting selective recovery of residual high-grade and residues from
the CMR and 4A9 sites, throughput was 10% lower at 1 919 000 t. This resulted
both from heavy rains in January and February and from a generally slower
recovery rate arising from the afore-mentioned selective recovery of residual
high-grade material.
Cash operating unit costs were 10% lower at US$557/oz. Cash operating profit
increased by 146% to R60.4 million, reflecting the higher average gold price
received and a higher average Rand:US Dollar exchange rate.
ERPM Quarter Quarter % Quarter
Mar 08 Dec 07 Change Mar 07
Ore milled
Underground t`000 78 72 8 61
Surface t`000 491 504 (3) 430
Total t`000 569 576 (1) 491
Yield
Underground g/t 4.68 7.11 (34) 6.52
Surface g/t 0.36 0.35 3 0.41
Total g/t 0.95 1.19 (20) 1.17
Gold produced
Underground oz 11 735 16 463 (29) 12 796
kg 365 512 (29) 398
Surface oz 5 627 5 626 - 5 724
kg 175 175 - 178
Total oz 17 362 22 089 (21) 18 520
kg 540 687 (21) 576
Cash operating costs
Underground US$/oz 967 777 (24) 711
ZAR/kg 235 250 170 171 (38) 165 952
ZAR/t 1 101 1 210 9 1 083
Surface US$/oz 427 729 41 629
ZAR/kg 106 789 159 537 33 146 725
ZAR/t 38 55 31 61
Total US$/oz 792 765 (3) 686
ZAR/kg 193 619 167 463 (16) 160 010
ZAR/t 184 200 8 188
Cash operating profit/(loss)
US$ m 2.4 0.6 300 (0.7)
ZAR m 18.0 3.5 414 (5.0)
Capital expenditure (net)
US$ m 0.7 1.3 46 1.3
ZAR m 5.8 9.0 36 9.5
9 months to 9 months to
31 Mar 08 31 Mar 07
Ore milled
Underground t`000 235 201
Surface t`000 1 501 1 253
Total t`000 1 736 1 454
Yield
Underground g/t 6.06 7.06
Surface g/t 0.38 0.37
Total g/t 1.15 1.30
Gold produced
Underground oz 45 882 45 653
kg 1 427 1 420
Surface oz 18 520 15 016
kg 576 467
Total oz 64 402 60 669
kg 2 003 1 887
Cash operating costs
Underground US$/oz 776 604
ZAR/kg 178 328 140 795
ZAR/t 1 081 994
Surface US$/oz 552 640
ZAR/kg 126 884 149 332
ZAR/t 49 56
Total US$/oz 711 613
ZAR/kg 163 534 142 908
ZAR/t 189 185
Cash operating profit US$ m 4.8 0.7
ZAR m 34.5 5.0
Capital expenditure (net)US$ m 2.9 3.6
ZAR m 21.0 26.1
Total gold production was 21% lower at 17 362 oz, reflecting a 29% drop in gold
production from underground to 11 735 oz. Surface gold production was steady at
5 627 oz.
Lower underground production resulted mainly from a 34% drop in yield to 4.68
g/t. This resulted from a temporary stoppage to mining in two high-grade
longwalls on 71 and 72 levels due to build up of stress as a result of the
increased rate of mining during the previous quarter. Underground throughput was
8% higher at 78 000 t but was nonetheless negatively affected both by Eskom`s
power cuts in January and by compressor and No 5 ice plant breakdowns.
A 3% increase in surface yield to 0.36 g/t was negated by a 3% drop in
throughput from the Cason Dump to 491 000 t, a consequence of a power outage
caused by flooding of the Angelo main pump station.
Total cash operating unit costs were 3% higher at US$792/oz, This resulted from
a 24% increase in underground cash operating unit costs to US$967/oz, a
consequence of lower underground gold production. Surface cash operating unit
costs were 41% lower at US$427/oz.
Cash operating profit was 414% higher at R18 million, due both to the higher
average gold price received and a higher average Rand:US Dollar exchange rate.
The plugging project at Far East Vertical Shaft has been completed and is 95%
complete at South East Vertical Shaft.
DISCONTINUED OPERATIONS - EMPEROR MINES LIMITED
Tolukuma Quarter Quarter % Quarter
Mar 08 Dec 07 Change Mar 07
Ore milled t`000 - 11 (100) 48
Yield g/t - 9.64 (100) 6.15
Gold produced oz - 3 394 (100) 9 483
kg - 106 (100) 295
Cash operating costs
US$/oz - 1 336 100 922
ZAR/kg - 292 887 100 215 146
ZAR/t - 2 822 100 1 322
Cash operating loss
US$ m - (1.7) 100 (0.8)
ZAR m - (11.5) 100 (6.1)
Capital expenditure (net)
US$ m - 0.1 100 1.3
ZAR m - 0.3 100 9.5
9 months to 9 months to
31 Mar 08 31 Mar 07
Ore milled t`000 56 136
Yield g/t 7.45 7.68
Gold produced oz 13 427 33 620
kg 417 1 045
Cash operating costs US$/oz 1 098 857
ZAR/kg 248 751 199 947
ZAR/t 1 852 1 536
Cash operating loss US$ m (2.6) (4.9)
ZAR m (18.0) (35.2)
Capital expenditure (net)US$ m 2.2 4.9
ZAR m 15.3 35.6
Porgera (20% of the Quarter Quarter % Quarter
Joint Venture) Mar 08 Dec 07 Change Mar 07
Ore milled t`000 - - - 214
Yield g/t - - - 2.69
Gold produced oz - - - 18 525
kg - - - 576
Cash operating costs
US$/oz - - - 597
ZAR/kg - - - 139 262
ZAR/t - - - 375
Cash operating profit
US$ m - - - 2.9
ZAR m - - - 21.2
Capital expenditure (net)
US$ m - - - 3.1
ZAR m - - - 22.3
9 months to 9 months to
31 Mar 08 31 Mar 07
Ore milled t`000 - 714
Yield g/t - 3.12
Gold produced oz - 71 570
kg - 2 225
Cash operating costs US$/oz - 450
ZAR/kg - 105 063
ZAR/t - 327
Cash operating profit US$ m - 10.7
ZAR m - 77.6
Capital expenditure (net)US$ m - 7.6
ZAR m - 55.2
Vatukoula Quarter Quarter % Quarter
Mar 08 Dec 07 Change Mar 07
Ore milled t`000 - - - -
Yield g/t - - - -
Gold produced oz - - - 429
kg - - - 13
Cash operating costs
US$/oz - - - -
ZAR/kg - - - -
ZAR/t - - - -
Cash operating profit
US$ m - - - 1.0
ZAR m - - - 7.1
Capital expenditure (net)
US$ m - - - 0.1
ZAR m - - - 0.7
9 months to 9 months to
31 Mar 08 31 Mar 07
Ore milled t`000 - 117
Yield g/t - 7.15
Gold produced oz - 26 910
kg - 836
Cash operating costs US$/oz - 795
ZAR/kg - 189 986
ZAR/t - 1 358
Cash operating loss US$ m - (4.5)
ZAR m - (36.9)
Capital expenditure (net)US$ m - 9.2
ZAR m - 66.2
CASH OPERATING COSTS RECONCILIATION
SOUTH AFRICAN OPERATIONS(R000 unless otherwise stated)
Crown ERPM Blyvoor Total
Total cash costs
Mar 08 Qtr 93 258 111 616 170 595 375 469
Dec 07 Qtr 93 557 120 769 172 440 386 766
9 months to Mar 08 282 834 348 768 521 609 1 153 211
Movement in gold in process
Mar 08 Qtr 945 (373) (606) (34)
Dec 07 Qtr 687 442 163 1 292
9 months to Mar 08 2 054 (1 225) (232) 597
Less: Production taxes,
rehabilitation and other
Mar 08 Qtr 3 369 2 266 1 515 7 150
Dec 07 Qtr 3 664 2 224 1 518 7 406
9 months to Mar 08 10 531 7 372 4 610 22 513
Less: Retrenchment costs
Mar 08 Qtr - - - -
Dec 07 Qtr - 7 - 7
9 months to Mar 08 - 366 - 366
Less: Corporate and general
administration costs
Mar 08 Qtr 3 479 4 423 4 001 11 903
Dec 07 Qtr 3 635 3 933 3 761 11 329
9 months to Mar 08 10 746 12 246 11 564 34 556
Cash operating costs
Mar 08 Qtr 87 355 104 554 164 473 356 382
Dec 07 Qtr 86 945 115 047 167 324 369 316
9 months to Mar 08 263 611 327 559 505 203 1 096 373
Gold produced (kg)
Mar 08 Qtr 643 540 1 006 2 189
Dec 07 Qtr 645 687 1 071 2 403
9 months to Mar 08 2 046 2 003 3 316 7 365
Cash operating costs (R/kg)
Mar 08 Qtr 135 855 193 619 163 492 162 806
Dec 07 Qtr 134 798 167 463 156 232 153 690
9 months to Mar 08 128 842 163 534 152 353 148 863
Cash operating costs (US$/oz)
Mar 08 Qtr 557 792 670 667
Dec 07 Qtr 617 765 715 703
9 months to Mar 08 560 711 663 647
EXPLORATION AND DEVELOPMENT
ERPM
ERPM Mining Lease Area
Drilling is in progress from 73 E 1, to verify the presence of a lateral
displacement of the major dip fault by an east west trending dyke, as
interpreted by previous drilling.
ERPM Extension 1 (Sallies)
The Annual Prospecting Report has been submitted to the DME. During the quarter
prospecting was confined within the mining lease area, however, future drilling
is planned from 70 level footwall drive east and is expected to intersect reef,
close to or within Extension 1.
BLYVOOR
An exploration drilling program has been scheduled out and drilling has
commenced with three air machines, drilling cover and structure holes, at 38 21
(south west block), 38 4 and 35 29 S2 (Alpha dyke). A fourth hydraulic machine
is on site and being transported to 38 level.
CROWN
During the quarter, exploration activity was concentrated on the Crown ERGO JV
in order to obtain a National Instrument 43-101 compliant gold, uranium and
sulphur resource. To date, drilling and sampling of ten holes per dump to soil
intersection has been completed at the Elsburg, Mooifontein, GMTS, Homestead and
Daggerfontein complexes. Rooikraal has been partially drilled, with future
drilling planned for Grootvlei, Marievale and Brakpan. All sampling has been
completed, in the prescribed manner and submitted to ALS Global, an independent
accredited laboratory for assay. Currently, there is a three month turn around
period on the assays. Additional drilling has been undertaken at Elsburg to
generate material for metallurgical test work. All relevant technical
information pertaining to the complexes is forwarded to RSG Global, for the
generation of the Competent Persons Report. During the quarter, they have
declared a SAMREC compliant measured gold resource for Benoni of 14.3 million
tons at 0.361 g/t.
DIRECTORS - (*British)(**Australian)(***American)
Executive:
JWC Sayers (Chief Executive Officer)
CC Barnes (Chief Financial Officer)
Non-executives:
J Turk ***
Independent non-executives:
DJM Blackmur** (Senior Non-Executive Director)
GC Campbell*(Non-Executive Chairman)
RP Hume
EJ Jeneker
Company Secretary:
TJ Gwebu
Sponsor:
QuestCo Sponsors (Pty) Limited
INVESTOR RELATIONS
For further information, contact John Sayers at:
Tel: (+27-11) 219-8700, Fax: (+27-11) 476-2637,
website: http://www.drdgold.com
Ebsco House 4, 299 Pendoring Avenue,
Blackheath, Randburg, South Africa.
PO Box 390,
Maraisburg, 1700,
South Africa.
Johannesburg
9 May 2008
Date: 09/05/2008 08:00:06 Produced by the JSE SENS Department.
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