DRD Gold expects major decrease in 6 month earnings | Fin24
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DRD Gold expects major decrease in 6 month earnings

Feb 06 2017 08:29

Cape Town – DRD Gold expects six-month earnings ended 31 December 2016 to decrease from between 76% to 96% as gold output decreased by 10%, operating costs increased by 9% and as it closed crown sites.

It said while the results were yet to be finalised, it expected earnings per share to be between 0.17 cents and 1.03 cents per share, which is a decrease of between 76% to 96% respectively compared to 4.3 cents earnings per share for the previous corresponding period.

It expects “headline loss per share to be between 2.66 cents and 2.14 cents per share compared to headline earnings of 2.6 cents per share for the previous corresponding period,” it said in a statement on Monday.

“Volume throughput amounted to six million tonnes compared to 6.6 million tonnes, a 10% decrease, while gold production amounted to 1 066kg compared to 1 034kg, a 3% increase; and operating costs increased by 9% to R82 per tonne.”

The final clean-up and closure of specific Crown sites continued to weigh on costs, causing both accelerated depreciation and retrenchment costs of approximately R18m each, it said.

After paying a dividend of R52m for the year ended 30 June 2016, DRD Gold ended the second quarter of FY2017 with R290m in cash and cash equivalents, compared with R335m at the end of the first quarter of FY2017.

The cash position was also influenced by an increase in working capital of R 70.5m for the six months ended 31 December 2016.

Gold production for the year ending 30 June 2017 is expected to be between 136 000 and 140 000 ounces at cash operating costs of between R468 000 per kilogram and R482 000 per kilogram.



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