DRDGold reports strong annual performance, declares dividend

DRDGold, a leading gold mining company, has recently announced a 75% increase in its full year dividend, reaching 35 cents per share. This decision comes after the company reported higher production and output levels for the period, marking a successful year for DRDGold. The group revenue saw a significant increase of 52%, while headline earnings rose to 82.4 cents per share, showcasing the company's strong financial performance. Neil Pretorius, the CEO of DRDGold, joined CNBC Africa to discuss the company's financial results and outlook for the future. During the interview, Neil addressed the concerns raised by some investors regarding the dividend size, emphasizing the importance of considering the current all-time high gold prices and upcoming capital investment projects. He mentioned that a cautious and responsible approach was taken in determining the dividend size, taking into account the potential impact of fluctuating gold prices on the company's earnings. Neil expressed optimism about the gold market dynamics but also highlighted the need for careful consideration due to the volatile nature of gold prices. When asked about the company's focus for the upcoming year, Neil shared his anticipation of the gold price reaching new heights, potentially hitting $2,000 per ounce or even surpassing $3,000. However, he also warned about the possibility of a price correction, advising stakeholders to be prepared for fluctuations in the market. Neil's insights reflected a balanced outlook on the gold market, acknowledging both the positive trends and potential risks. Regarding the relationship with unions, Neil spoke about the positive collaboration between DRDGold and the workforce during the challenging times of the pandemic. He mentioned that feedback from unions has been supportive, with a focus on sustaining workers' livelihoods and ensuring their well-being. Neil emphasized the importance of maintaining a positive sentiment at the workplace and expressed confidence in the current dynamics with unions. In terms of capital expenditure, Neil outlined the company's plans to optimize existing assets and extend the life of mines, particularly focusing on the Ergo project in Johannesburg. He emphasized the importance of responsible financial management and conservative approaches to debt and shareholder value. Neil also highlighted the company's strategy of leveraging the Subanya footprint for future growth opportunities, emphasizing a service-oriented value offering in tailings management and rehabilitation. Overall, DRDGold's strong annual performance and dividend declaration reflect the company's resilience amidst the uncertainties in the gold market. Neil Pretorius' strategic insights and cautious optimism paint a picture of a company poised for growth and sustainability in the ever-evolving mining industry.