DRDGOLD Delivers Exceptional Performance in H1 2026 with Strong Gold Production, Increased Revenue, and Improved Cost Discipline
Good morning, everyone. Thank you very much for joining us today for this presentation.
This year has been a remarkable one for DRDGOLD, as the company celebrates its 19th consecutive financial year of paying a dividend. The final cash dividend for the year is ZAR 1.20 per share, which is just over ZAR 1 billion, and represents a significant milestone in the company's history.
According to the company's CEO, DRDGOLD's strong performance can be attributed to a number of factors working together, including the production of gold, which was "pretty pleasing" with a total of just under 5 tons produced. This exceeded the higher end of guidance for the year and resulted in an average yield of just under 0.2 g per ton, a 2% increase from the previous year.
The company's deliberate decision not to hedge against gold price fluctuations has also paid off, as the 40% increase in gold price translated into revenue of just over ZAR 11 billion, a 42% increase from the previous year. Cash operating costs for the year were just under ZAR 1 million a kg, a 7% increase from the previous year, but still a testament to good cost discipline.
One of the key highlights of the quarter was the company's ability to take advantage of the higher gold price by trucking in high-grade material, which resulted in an attractive margin. This strategy will continue to be part of the company's throughput profile going forward.
The strong performance is reflected in the company's operating profit, which increased to ZAR 6.4 billion, an 83% increase from the previous year. Headline earnings also saw a significant increase, reaching ZAR 4.2 billion, an 89% increase. Free cash flow, a key parameter for DRDGOLD, was generated in the amount of ZAR 2.2 billion, an 85% increase.
The company's performance is all the more impressive considering the current climate and the challenges faced by gold producers in South Africa. DRDGOLD's commitment to cost discipline and its ability to adapt to changing market conditions have clearly paid off.
In his presentation, the CEO took a moment to remember John Weber, a long-time friend and advisor who passed away recently. The company will miss his guidance and expertise, but his legacy will live on in the company's continued success.
