DRDGOLD Limited

For financial year 2026, revenue was just over ZAR 11 billion, up 42% year-on-year. Operating profit was ZAR 6.4 billion, up 83%, and headline earnings were ZAR 4.2 billion, up 89%; headline earnings per share rose from ZAR 261 to ZAR 492. Free cash flow was ZAR 2.2 billion, up 85%, after capital expenditure of ZAR 3.5 billion, and the group ended with just under ZAR 2.8 billion in cash and cash equivalents. Production was just below 5 tonnes, about 5,000 ounces above the higher end of guidance, with an average yield of just under 0.2 gram per tonne, up 2%. For Ergo, revenue was ZAR 8.1 billion versus ZAR 5.7 billion last year, and operating profit more than doubled to ZAR 4.1 billion. For Far West, revenue rose to ZAR 3.1 billion from ZAR 2.2 billion, with cash operating costs of ZAR 744 million and an operating profit margin of 76%. Looking ahead to financial year 2027, management guided to 160,000 to 170,000 ounces, cash costs of just over ZAR 1 million a kilo, all-in sustaining costs of ZAR 1.2 million, and planned capital of just over ZAR 3 billion.

Niël/lead management framed the year as a strong execution story: the company delivered above guidance, fully benefited from the gold price because it remains deliberately unhedged, and kept safety and sustainability metrics trending in the right direction. He emphasized that the business is in a deliberate interim phase focused on protecting tailings storage integrity while building the Vision 2028 platform, including more throughput and lower future capital intensity. His tone was confident and upbeat, but disciplined: preserve margins, keep investing, and protect the dividend model.

Henriette Hooijer highlighted that the year’s strong financial outcome came from both the 40% gold price increase and solid operational performance, while cash operating costs rose only 7% group-wide despite significant inflation in diesel, trucking, reagents, carbon and cyanides. She pointed to Ergo revenue of ZAR 8.1 billion, Far West revenue of ZAR 3.1 billion, group free cash flow of ZAR 2.2 billion, and a 65% payout of free cash flow through the interim plus final dividend. On the balance sheet, she stressed the debt-free position, cash and cash equivalents of just under ZAR 2.8 billion, property, plant and equipment of ZAR 11.9 billion, and a rehabilitation trust fund that moved above ZAR 1 billion.

Analysts focused on the stock’s valuation versus South African gold peers, additional renewable energy plans, possible platinum group metal tailings opportunities, uranium, and modernization/AI. Management said the share price should track delivery more closely now that production is no longer lagging, noted a 30 MW renewable power project coming through the grid, and said platinum tailings could be a technical opportunity if Sibanye-Stillwater invited them in. On uranium, management was negative, saying gold and uranium recovery are not good partners in the same tailings circuit and that sacrificing gold recovery for uranium would not be justified at current throughput and margins. On modernization, they said AI should be an analytical tool, not a decision-maker, and pointed to upflow reactor technology as a promising incremental recovery improvement.