DRDGOLD Ltd (NYSE:DRD) (JSE:DRD) told investors it is looking forward to the contribution of its Far West Gold Recoveries (FWGR) project in the second half, as it posted results for the six months to the end of December.
Construction on the project in South Africa started in August last year and early commissioning kicked off at the tail end of last year. The project is off to a "flying start," the company said in its earnings report Wednesday.
Looking ahead, CEO Niël Pretorius said he expects phase 1 of FWGR to be fully commissioned during the first half of calendar 2019 and its contribution showing in the second half.
For 2019, the group guides for gold output of between 157,000 and 165,000 ounces at a cash operating cost of around R500 000 per kg.
Turning the page
The South Africa-based miner said 2018 had been a tough year for most South African gold miners, and although it managed to avoid labor issues, production had been blighted by power group Eskom and energy disruptions.
Whilst plant performance on the whole was consistent with expectations, around 49 kg of gold had been lost for this reason in the six months.
That led to overall gold production being down 3% at 2,280kg versus output of 2,341 kg in the same period of 2017.
The amount of gold sold clocked in at 2,255kg (2017: 2,291kg), while all-in-sustaining costs (ASIC) were at $1,208 per ounce compared with $1,050 per ounce the previous year.
The higher South African Rand gold price received helped to offset lower gold production and sales and total revenue was almost unchanged at R1 252.5 million.
Operating profit was R102.2 million, down 54%, due to lower production and higher costs.
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