DRDGOLD Holds Output Steady as Vision 2028 Targets 25% Gold Growth

DRDGOLD NYSE: DRD said it maintained gold production of 155,000 ounces in its latest financial year while advancing a multiyear infrastructure program intended to increase throughput, extend mine lives and support higher output by fiscal 2028.

During a presentation, Niël said the company’s operations are focused entirely on reclaiming and reprocessing mine tailings rather than primary mining. DRDGOLD operates two units: Ergo Mining Proprietary Limited, with current throughput capacity of 1.6 million tons per month, and Far West Gold Recoveries, which processes about 500,000 tons per month.

The company uses high-pressure water jets to turn tailings material into slurry, which is transported through pipelines to processing plants. Niël said the water used is industrial-quality rather than potable and remains in a closed circuit. Reclaimed tailings sites are rehabilitated and restored to natural conditions or sustainable land uses, he added.

Financial Results and Capital Returns

Production was flat year over year at 155,000 ounces, generated from 25 million tons of material processed. DRDGOLD recovered just under 0.2 grams of gold per ton, reflecting the low-grade nature of the tailings deposits.

Cash operating costs were just under $1,800 per ounce and all-in sustaining costs were just under $2,000 per ounce, according to the presentation. The company sold nearly 156,000 ounces of gold and reported an all-in sustaining margin of 53% for fiscal 2026. Niël said the margin increased 14% year over year, supported by a higher gold price.

Revenue increased 52% to $660 million, while cash and cash equivalents rose 128% to $164 million. Cash operating profit doubled to $382 million, and free cash flow doubled to $134 million after $209 million of growth capital expenditure.

The company paid what Niël described as its largest dividend to date, totaling ZAR1.4 billion, or roughly 65% of headline earnings. The payment marked DRDGOLD’s 19th consecutive year of dividends. Its loan facility for the capital expansion program remained undrawn because the company was cash positive, he said.

Niël said the company prioritizes sustaining capital expenditure, followed by growth spending, maintaining liquidity and dividends. He also said DRDGOLD provides shareholders with full exposure to movements in the gold price and that its mechanized operations make costs relatively predictable.

Vision 2028 Expansion Program

The company’s Vision 2028 plan consists of five projects designed to add about 20 years to the life of each operation, increase throughput by 40% and raise output by 25%.

• Daggafontein: A recommissioned Ergo tailings facility adding 120 million tons of storage capacity over the life of mine. It has been commissioned and is receiving about 25,000 tons per day.
• DP2 expansion: An expansion at Far West Gold Recoveries intended to double plant capacity from 600,000 tons per month to 1.2 million tons per month. The new portion has been built and is being commissioned, while the existing portion undergoes an overhaul.
• Pipeline project: Infrastructure to connect new resources to Far West Gold Recoveries. The project was about 95% complete, with pump-station construction expected to continue until April.
• Regional Tailings Storage Facility: An 800-hectare, lined facility designed to Global Industry Standard on Tailings Management standards and ultimately capable of receiving 800 million tons of material.
• Withok Tailings Storage Facility: A project expected to add 310 million tons of storage capacity at Ergo and 150,000 tons per month of throughput capacity. Commissioning is targeted for late 2029 or early 2030, subject to permitting and construction.

The Regional Tailings Storage Facility remains dependent on a final permission tied to construction quality-control requirements. Niël said the company expected a 60-day review period beginning Oct. 15 and was confident it would meet the technical standards. Weather conditions could also affect the timing of commissioning because heavy rain could cause fines to block the facility’s filters.

Expected Capacity Growth

DRDGOLD expects throughput capacity of 2.1 million tons per month to rise to 2.85 million tons per month by the next financial year and then to 3 million tons per month once Withok is operational. Annual output capacity is projected to rise from 155,000 ounces to between 185,000 and 195,000 ounces.

Niël said the Regional Tailings Storage Facility could ultimately receive more than 2.4 million tons of material per month after final commissioning, potentially providing a platform for additional growth and regional consolidation. For now, he said, the company’s focus is on bringing the projects online and meeting its near-term Vision 2028 objectives.

About DRDGOLD (NYSE:DRD)

DRDGOLD Limited is a South African gold producer focused on the recovery of gold from historical mine dumps and tailings. Rather than operating conventional underground mines, the company reprocesses surface material generated by earlier mining activities, extracting gold that remains in the tailings.

Its principal operations are the Ergo Mining and Far West Gold Recoveries businesses. Ergo operates in the Witwatersrand Basin near Johannesburg and the East Rand, while Far West Gold Recoveries processes surface material from the western Witwatersrand.

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