DRDGOLD to focus on keeping costs low
The junior gold miner said headline earnings per share fell to 10 cents in the third quarter to the end of March from 13.6 cents in the second quarter to end December.
Author: Reuters
Posted: Friday , 24 Apr 2009
mineweb.com
South Africa's fourth biggest gold producer, DRDGOLD Ltd, said on Friday that production fell 2 percent in the third quarter after it briefly halted output at a key mine.
The junior gold miner said headline earnings per share fell to 10 cents in the third quarter to the end of March from 13.6 cents in the second quarter to end December.
Niel Pretorius, the chief executive of DRDGOLD, said the company would focus on reducing risk and keeping costs low. It would also seek to improve headline earnings per share and conserve capital for the foreseeable future.
"While there is considerable comfort to be drawn from a stronger gold price, particularly if accompanied by rand weakness, we know we cannot be complacent," he said.
Operating profit rose 38 percent 129.9 million rand, buoyed by a 19 percent rise in the average dollar gold price to $915/ounce, while the rand/kg gold price rose 15 percent to 292,369 rand per kg.
The country's gold producers pay for their costs in rand and receive most of their earnings in dollars.
Spot gold rose to $911.55 per ounce by 0646 GMT, up more than 1 percent from New York's notional close of $902.00.
Pretorius said global economics will continue to be characterised by considerable volatility for some time, and expected gold to trade in the $1,100 to $ 1,200 per ounce range.
He said recent events such as the gold sale by the International Monetary Fund and the strengthening of the rand showed there was likelihood for more volatility.
DRDGOLD said gold production fell to 58,997 ounces due to a drop of more than 50 percent in output at its ERPM operations, where underground was suspended for some time.
Headline earnings is the key profit measure in South Africa, stripping out capital, non-trading and some extraordinary items. |
