DRDGOLD Ltd. (NYSE:DRD) Q2 2020 Earnings Conference Call - Final Transcript

Feb 12, 2020 • 03:00 am ET

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DRDGOLD Ltd. (NYSE:DRD) Q2 2020 Earnings Conference Call - Final Transcript

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Presentation
Operator
Niel Pretorius

Good morning, everybody, and welcome to our Results Presentation. Is the sound and picture are currently inside? Yeah. Good, if you can just nod or put up your hand like this?

Executive
Riaan Davel

Yes. We've got you. Thank you.

Operator
Niel Pretorius

Okay. Excellent. Thanks very much. Then, you'll be forwarding the slides as we go along, right?

Executive
Riaan Davel

Yes, we will.

Operator
Niel Pretorius

Okay. So let's move on to the -- Riaan, you're going to be moving the slides forward as we go along, is that correct?

Executive
Riaan Davel

Yes, that's correct.

Operator
Niel Pretorius

Okay. Lovely. All right. So, thank you very much and -- for joining us this morning. I'm going to move straight into the presentation. And while we look at the disclaimer, where we have a picture, not coincidentally of a lady. She is one of several others representing 23% of our labor force. Maybe just one or two words on what the focus of this presentation is going to be. This is the first year -- well, the first period, we will be reporting was first West -- Far West operations rather in a full volume production. So, obviously, this was almost the benchmark for numbers going forward. It's the first establishing the standard or the major for the next reporting periods. So that the comparatives are slightly skewed as a consequence of that, but they do make for good reading nonetheless, and I think they demonstrate just the impact of this combined circuit that we now have.

So moving on to the next slide straight into the Group highlights. Moving on to the highlights. Slide -- we can move on to number three there. Thank you. I think the -- we've always been talking about production within the context of tons. So 1 ton per quarter gives us 4 tons per year. And what you see there now is that, with a 33% rise, both as a consequence of over-performing really well over the six months considering the number of issues that we had to deal with and I'll talk a little bit more about that later on, but we actually achieved production of 3 times for the six months. And that resonated in the numbers, you can see that there is an operating profit that's increased by 604% to just under the ZAR750 million. And all-in sustaining margin up from less than 1% to 26.7%. This translated into the healthy headline earnings just under a ZAR333 million, and Riaan will obviously spend a little bit more on those numbers.

And as a consequence, we are also in a position now to after six months declared a dividend of ZAR0.25 per share and this will be the 13th consecutive year where our Company has been in a position to distribute free cash and payout a dividend. We will reflect a little bit just on how we arrived at this dividend, you'll see that we mentioned in our letter to shareholders, and the back on our thinking in this regard. Obviously, our philosophy has always been there. We