Media releases

Clean-up operations weigh in on production, financial performance – but new sites pave way for better things

15 February 2017

Johannesburg, South Africa. 15 February 2017. DRDGOLD Limited (DRDGOLD; JSE, NYSE: DRD) has announced a 4% increase in operating profit to R172.6 million for the six months to 31 December 2016 compared with the six months to 31 December 2015, a rise in the average Rand gold price helping to offset the impact of lower production as the company continued to focus on the previously-reported, extensive pre-closure clean-up at its veteran Crown operation.

Gold production was 7% lower at 2 100kg, reflecting a 2% decline in throughput to 12 632 000t and a 6% decline in yield to 0.166g/t. Besides the Crown clean-up, operations in the six months were also affected first by dry conditions and low water quality, and then by flash floods.

Cash operating unit costs increased by 14% to R490 531/kg due mainly to lower gold production but other contributors were an average 8.5% increase in wages, and a 9% and 14% rise in the cost of electricity and water respectively.

A headline loss of R10.2 million (2.4 South African cents) was recorded compared with headline earnings of R10.9 million (2.6 south African cents per share), due mainly to accelerated depreciation and retrenchment costs of R18 million each, associated with the Crown clean-up.

New reclamation sites

Two new reclamation sites have been commissioned in recent weeks. Reclaimed slimes from 4L2 alongside the M2 freeway, south east of Johannesburg’s CBD – which contains some 11.9Mt at 0.30g/t – will report to the City Deep plant at a rate of 300 000tpm, and then to the Ergo plant for gold extraction.

Reclaimed slimes from 4L37 in Ekurhuleni – which contains 7.2Mt at 0.28g/t will report directly to the Ergo plant at a rate of 300 000tpm for gold extraction for a period of 24 months.

Two other slimes dams – 4L50, containing 20.3Mt at 0.26g/t and 7L15, containing 17.1Mt at o.26g/t – are being assessed currently in order to decide which should be prioritised for reclamation.

DRDGOLD CEO Niël Pretorius says the new reclamation sites are expected to enhance consistency in volume delivery and to come in at a much lower unit cost than the sites associated with the Crown clean-up.

Sustainable development

DRDGOLD’s new Central Water Facility on the footprint of the ERPM high density separation water treatment plant in Ekurhuleni will be commission by the end of March 2017, and will provide the two days’ water storage required for the City deep and Knights operations.

Total environmental expenditure for the six months was R26.1 million, most of which was directed towards the vegetation of 10ha on the Brakpan/Withok Tailings Storage Facility, 5ha on the Daggafontein Tailings Storage Facility and 10ha on the Crown Tailings Complex.

In spite of very dry weather conditions until November, dust exceedances for the six months were very low – four out of a total of 588 readings. (0.7%).

During the period under review, approval was received from the National Nuclear Regulator and the Gauteng Department of Agriculture and Rural Development for the redevelopment of the cleared 4L8 site, post rehabilitation. Some 90ha of prime land are available.

South Africa & North America
Investor and Media Relations

James Duncan
Russell and Associates
+27 11 880 3924 (office)
+27 (0) 79 336 4010 (mobile)

United Kingdom/Europe
Investor and Media Relations
Phil Dexter, St James’s Corporate Services
+44 (0) 20 7796 8644 (office)
+44 (0) 779 863 4398 (mobile)

For more information, please visit www.drdgold.com

Disclaimer

Many factors could cause the actual results, performance or achievements 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 we serve, 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 licenses 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 our annual report for the fiscal year ended 30 June 2016, which we filed with the United States Securities and Exchange Commission on 31 October 2016 on Form 20-F. You should not place undue reliance on these forward-looking statements, which speak only as of the date thereof. We do 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 release have not been reviewed and reported on by DRDGOLD’s auditors.