6-K 1 tradingstatement.htm 6-K tradingstatement
 
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
______________________
 
FORM 6-K
 
REPORT OF A FOREIGN PRIVATE
 
ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
 
For August 2020
 
Commission File Number 0-28800
______________________
 
DRDGOLD Limited
 
Constantia Office Park
Cnr 14th Avenue and Hendrik Potgieter Road
Cycad House, Building 17, Ground Floor
Weltevreden Park
South Africa, 1709
 
(
Address of principal executive offices
)
______________________
 
Indicate by check mark whether the registrant files or will file annual reports under cover of Form 20-F or Form
40-F.
 
Form 20-F
 
Form 40-F
 
 
Indicate by check mark whether the registrant by furnishing the information contained in this Form is also
thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities
Exchange Act of 1934.
 
Yes
 
No
 
 
If ''Yes''
 
is marked, indicate below the file number assigned to the registrant in connection with Rule 12g3-2(b):
N/A
 
 
 
Attached to the Registrant Form 6-K filing for the month of August 2020, incorporated by reference herein:
 
Exhibit
 
99.1 Release dated
 
August 2020,
 
“TRADING STATEMENT
 
AND FURTHER
 
OPERATIONAL
 
UPDATE
FOR THE YEAR ENDED 30 JUNE 2020.”
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report
to be signed on its behalf by the undersigned, thereunto duly authorized.
 
DRDGOLD LIMITED
Date: August, 26 2020 By:
 
/s/ Riaan Davel
 
Name: Riaan Davel
 
Title: Chief Financial Officer
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Exhibit 99.1
DRDGOLD LIMITED
(Incorporated in the Republic of South Africa)
(Registration number: 1895/000926/06)
ISIN: ZAE000058723
JSE share code: DRD
NYSE trading symbol: DRD
(“
DRDGOLD
” or the “
Company
” or the “
Group
”)
TRADING STATEMENT
 
AND FURTHER OPERATIONAL
 
UPDATE
 
FOR THE YEAR ENDED 30 JUNE 2020
TRADING STATEMENT
 
In terms
 
of paragraph
 
3.4(b) of
 
the JSE
 
Limited Listings
 
Requirements, companies
 
are required
 
to publish
 
a trading
statement as
 
soon as
 
they are
 
satisfied, with
 
a reasonable
 
degree of
 
certainty, that
 
the financial
 
results for
 
the current
reporting period will differ by at least 20% from the
 
financial results of the previous corresponding period.
 
DRDGOLD is in
 
the process
 
of finalising its
 
results for
 
the year ended
 
30 June 2020
 
(“
Current Reporting
 
Period
”) and
shareholders are accordingly advised that the Company
 
has reasonable certainty that it will report:
 
earnings per
 
share (“
EPS
”) of
 
82.5 cents
 
per share
 
compared to
 
earnings of
 
11.8 cents
 
per share
 
for the
 
previous
corresponding period; and
 
headline earnings per
 
share (“
HEPS
”) of 82.4
 
cents per share
 
compared to headline
 
earnings of 10.9
 
cents per share
for the previous corresponding period.
The expected increases
 
in EPS and HEPS for
 
the Current Reporting Period compared to the
 
previous corresponding period
are due mainly to movements in,
inter alia
, the following items:
 
1. Revenue
Revenue increased by R1,422.9
 
million, or 52%,
 
to R4,185.0 million (2019:
 
R2,762.1 million), as a
 
result of an increase
 
in
(i) Ergo’s
 
revenue by
 
R486.8 million
 
to R3,064.3
 
million (2019:
 
R2,577.5 million)
 
and (ii)
 
Far West
 
Gold Recoveries
(“
FWGR
”) revenue by R936.1 million to R1,120.7 million (2019: R184.6
 
million).
 
At Ergo the 33% increase
 
in the Rand gold price
 
received offset an
 
11% decrease
 
in gold sold, which was
 
as a result of a
3.0Mt decline in volume throughput to
 
20.2Mt, due mainly to the COVID-19
 
national lockdown in South Africa (“
Lockdown
”)
and interruptions in power supply from Eskom and the
 
City of Ekurhuleni. FWGR enjoyed its first full
 
financial year of Phase
I production, taking full advantage of the higher gold price.
 
2. Cash
 
operating costs
The impact of the increase in revenue on earnings and headline earnings was moderated by an increase in cash operating
costs of R203.1
 
million, or 8%,
 
to R2,626.0 million
 
(2019: R2,422.9 million),
 
largely due to
 
the inclusion of
 
the additional
cash operating costs of FWGR for the full financial year.
 
The increase of 8% in cash operating costs is also reflective of the
total volume throughput increasing by 8% with the cash
 
operating costs per unit being stable at R100/t.
 
3. Weighted
 
average number of ordinary shares
EPS and HEPS
 
increased notwithstanding the issuance
 
of 168,158,944 shares to
 
Sibanye Stillwater Limited at
 
an aggregate
subscription price
 
of R1,
 
085,590,116, on
 
22 January
 
2020. This
 
resulted in
 
the DRDGOLD
 
ordinary shares
 
in issue
increasing by 24% to 864,588,711
 
shares.
 
 
FURTHER OPERATIONAL
 
UPDATE
 
Shareholders are referred to the
 
operational update for the year
 
ended 30 June 2020 published on
 
SENS on 5 August 2020.
Further information in regard to DRDGOLD’s operations
 
is provided below.
Year ended
30 Jun 2020
Year ended
30 Jun 2019
All amounts presented in R million unless otherwise indicated
Rm
Rm
Revenue
4,185.0
2,762.1
Cost of sales
(2,937.9)
(2,553.9)
Cash operating costs
(2,626.0)
(2,422.9)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Movement in gold in process
3.1
32.6
Ongoing rehabilitation expenditure
(24.3)
(18.3)
Other operating costs including care and maintenance costs
(41.8)
(29.9)
Depreciation
(270.8)
(169.1)
Change in estimate of environmental rehabilitation recognised
 
in profit or loss
21.9
60.0
Retrenchment costs
-
(6.3)
Gross profit from operating activities
1,247.1
208.2
Other income
0.7
7.9
Administration expenses and other costs
(309.9)
(90.9)
Administration expenses and other costs excluding share-based
 
payment expense
(85.8)
(69.5)
Share-based payment expense
(224.1)
(21.4)
Results from operating activities
937.9
125.2
Finance income
109.8
58.3
Finance expense
(68.8)
(78.4)
Profit before tax
978.9
105.1
Income tax
(343.9)
(26.6)
Profit for the year
635.0
78.5
OPERATIONAL PERFORMANCE
Ore milled
 
(000’t)
26,280
24,439
Yield
 
(g/t)
0.206
0.197
Gold produced
 
(kg)
5,424
4,826
Gold sold
 
(kg)
5,437
4,783
Cash operating costs
(R/t)
100
99
Cash operating costs
(US$/t)
6
7
Cash operating costs
(R/kg)
482,417
499,749
Cash operating costs
(US$/oz
)
958
1,096
All-in sustaining costs*
(R/kg)
541,475
524,713
All-in sustaining costs*
(US$/oz
)
1,075
1,151
All-in cost*
(R/kg)
551,646
600,941
All-in cost*
(US$/oz
)
1,131
1,361
Sustaining capital expenditure
(164.2)
(22.5)
Non-sustaining capital expenditure
(18.5)
(331.2)
Reconciliation of adjusted EBITDA
Profit for the year
635.0
78.5
Income tax
343.9
26.6
Profit before tax
978.9
105.1
Finance expense
68.8
78.4
Finance income
(109.8)
(58.3)
Results from operating activities
937.9
125.2
Depreciation
270.8
169.1
Share-based payment expense
224.1
21.4
Change in estimate of environmental rehabilitation recognised
 
in profit or loss
(21.9)
(60.0)
Gain on financial instruments
-
(2.1)
Gain on disposal of property, plant and equipment
(0.7)
(5.8)
Retrenchment costs
-
6.3
Transaction costs
1.4
-
Adjusted EBITDA **
1,411.6
254.1
Rounding of figures may result in computational discrepancies
* All-in cost definitions based on the guidance note on non-GAAP
 
Metrics issued by the World Gold Council on 27 June 2013
** Adjusted earnings before interest, taxes, depreciation and amortisation
 
(“Adjusted EBITDA”) may not be comparable to
similarly titled measures of other companies. Adjusted EBITDA
 
is not a measure of performance under International Financial
Reporting Standards (IFRS) and should be considered in addition
 
to, and not as a substitute for, other measures of financial
performance and liquidity
4. COVID-19
The Group temporarily halted its operations on 26 March
 
2020 pursuant to the announcement of the Lockdown.
 
The regulations
 
pertaining to
 
the Disaster
 
Management Act,
 
No. 57
 
of 2002,
 
issued by
 
the Department
 
of Co-operative
Governance and
 
Traditional Affairs
 
define gold
 
mining and
 
refining as
 
an essential
 
service and
 
therefore exempt
 
from
restrictions imposed by the Lockdown.
 
Despite this
 
exemption, and
 
in consultation
 
with the
 
Department of
 
Mineral Resources
 
and Energy
 
and organised
 
labour,
DRDGOLD only recommenced production
 
at its operations once it
 
was satisfied that the appropriate
 
measures and protocols,
to limit the risk of infection to staff and others,
 
were fully implemented and operational, as further detailed
 
below:
 
FWGR, with a relatively small footprint and with staff
 
living close by, was
 
able to restart operations on 4 April 2020; and
 
Ergo restarted operations on
 
9 April 2020, with
 
reclamation from a limited
 
number of sites continuing
 
through to the end
 
of
June. Ergo’s Knights plant only restarted operations
 
on 7 May 2020.
Due to both operations
 
being able to
 
resume production relatively
 
soon after the
 
commencement of the
 
Lockdown period on
26 March 2020,
 
DRDGOLD was able
 
to continue to
 
pay salaries and
 
wages on the
 
understanding with DRDGOLD
 
staff that
everyone was on duty and
 
on ‘standby at home’. During
 
the initial restart of operations
 
,
 
all returning staff were
 
volunteers and
had been cleared as medically fit to work.
 
DRDGOLD’s staff showed unreserved support for the hygiene,
 
social distancing and team and shift de-densification measures
implemented. The
 
Group’s infection
 
rate has
 
been low,
 
and the 50-bed
 
quarantine facility
 
which was
 
established at
 
Ergo is
presently vacant.
To
 
assist in
 
bringing urgent
 
relief to
 
people most
 
impacted by
 
the COVID
 
-19 pandemic
 
,
 
DRDGOLD’s staff
 
contributed R1.6
million through
 
salary sacrifices
 
to the nationwide
 
Solidarity Fund.
 
DRDGOLD further
 
funded and
 
participated in
 
an initiative
with Impophomo
 
Rushing Waters
 
and DRDGOLD’s
 
social development
 
partner, Umsizi
 
Sustainable Social
 
Solutions, to
distribute approximately 5,420 food-parcels to families in distressed
 
communities neighbouring DRDGOLD’s
 
operations.
Management continues to
 
manage the COVID
 
-19 pandemic risk
 
with no relaxation
 
of any of
 
its initial contai
 
nment measures
and protocols and through ongoing communication with
 
and motivation of staff.
 
5. Liquidity
As at
 
30 June
 
2020, DRDGOLD
 
’s cash
 
and cash
 
equivalents was
 
R1,715.1 million
 
(30 June
 
2019: R279.5
 
million),
 
with a
revolving credit facility with ABSA Bank
 
Limited of R175 million, available
 
if needed. The Group remains
 
free of any bank debt
as at 30 June 2020 (30 June 2019: Rnil).
 
Liquidity is further enhanced by current high Rand gold
 
price levels.
The forecast
 
financial information contained in this announcement is the responsibility of the
 
directors of DRDGOLD, and such
information has not been reviewed or reported on by
 
the Company’s auditors.
 
The condensed consolidated reviewed provisional results for the year ended
 
30 June 2020 are expected to be published on or
about 1 September 2020.
 
Johannesburg
26 August 2020
 
 
 
Sponsor
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