UNITED STATESSECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 20-F ☐
 REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE
  SECURITIES EXCHANGE ACT OF 1934OR☑
 ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
  EXCHANGE ACT OF 1934 For the fiscal year ended June 30, 2019OR☐
 TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
  SECURITIES EXCHANGE ACT OF 1934OR☐
 SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
  EXCHANGE ACT 1934
 Commission file number 0-28800  DRDGOLD LIMITED (Exact name of Registrant as specified in its charter and
translation of Registrant's name into English) REPUBLIC OF
  SOUTH AFRICA
  (Jurisdiction of incorporation or organization)1 Sixty Jan Smuts Building, 2nd Floor - North Tower,
  160 Jan Smuts Avenue, Rosebank, 2196, South Africa
  (Address of principal executive offices)
  Riaan Davel, Chief Financial Officer, Tel. no. +27
  11 470 2600, Email riaan.davel@drdgold.com
  Francois Bouwer, Group Financial Accountant, Tel. no.
  +27 11 470 2600, Emailfrancois.bouwer@drdgold.com
  1 Sixty Jan Smuts Building, 2nd Floor - North Tower,
  160 Jan Smuts Avenue, Rosebank, 2196, South Africa
  (Name, Telephone, Email and/or Facsimile number and
  Address of Company Contact Person)
 Securities registered or to be registered
pursuant toSection 12(b) of the Act Title of each class:
 Trading symbol
 Name of each exchange on which registered:Ordinary shares (traded in the form of American
  Depositary Shares, each American Depositary Share representing ten underlying
  ordinary shares.)
 DRD
 The New York Stock Exchange, Inc.
 Securities registered or to be registered
pursuant to Section 12(g) of the ActNone Securities for which there is a reporting obligation
pursuant to Section 15(d) of the ActNone Indicate the number of outstanding shares of each of the
issuer's classes of capital or common stock as of the close of the period
covered by the annual report.696,429,767
ordinary shares of no par value outstanding as of June 30, 2019. Indicate by check mark if the registrant is a well-known
seasoned issuer, as defined in Rule 405 of the Securities Act. Yes☐No☑ If this report is an annual report or transition report,
indicate by check mark if the registrant is not required to file reports
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.   Yes☐No☑ Indicate by check mark whether the registrant
(1) has filed all reports required to be filed by Section 13 or 15(d)
of the Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file such reports),
and (2) has been subject to such filing requirements for the past
90 days.    Yes☑No☐ Indicate
by check mark whether the registrant has submitted electronically every
Interactive Date File required to be submitted pursuant to Rule 405 of
Regulation S-T (§232.405
of this chapter) during the preceding 12 months (or for such shorter period
that the registrant was required to submit such files). Yes☑No☐ Indicate by check mark whether the registrant is a large
accelerated filer, an accelerated filer, a non-accelerated filer, or an
emerging growth company. See definition of “large accelerated filer,”
“accelerated filer,” and “emerging growth company” in Rule 12b-2 of the
Exchange Act. Large accelerated filer☐Accelerated filer☑Non-accelerated filer☐Emerging growth
company☐ If any emerging growth company that prepares its
financial statements in accordance with U.S. GAAP, indicate by check mark if
the registrant has elected not to use the extended transition period for
complying with any new or revised financial accounting standards provided
pursuant to Section 13(a) of the Exchange Act☐ The term “new or revised financial accounting standard”
refers to any update issued by the Financial Accounting Standards Board to its
Accounting Standards Codification after April 5, 2012. Indicate by check mark which basis of accounting the
registrant has used to prepare the financial statements included in this filing.U.S. GAAP☐International Financial Reporting Standards as issued by the International Accounting Standards Board☑Other☐ If “Other” has been checked in response to the previous
question, indicate by check mark which financial statement item the registrant
has elected to follow.   Item 17☐Item 18☐ If this is an annual report, indicate by check mark
whether the registrant is a shell company (as defined in Rule 12b-2 of the
Exchange Act).   Yes☐No☑ Indicate by check mark whether the registrant has filed
all documents and reports required to be filed by Sections 12, 13 or 15(d) of
the Securities Exchange Act of 1934 subsequent to the distribution of
securities under a plan confirmed by a court.  Yes☑No☐


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TABLE OF CONTENTSPagePART IITEM 1.
 IDENTITY
  OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS
 5ITEM 2.
 OFFER
  STATISTICS AND EXPECTED TIMETABLE
 5ITEM 3.
 KEY
  INFORMATION
 53A.
 Selected
  Financial Data
 53B.
 Capitalization
  And Indebtedness
 73C.
 Reasons
  For The Offer And Use Of Proceeds
 73D.
 Risk
  Factors
 7ITEM 4.
 INFORMATION
  ON THE COMPANY
 194A.
 History
  And Development Of The Company
 194B.
 Business
  Overview
 204C.
 Organizational
  Structure
 284D.
 Property,
  Plant And Equipment
 29ITEM 4A.
 UNRESOLVED
  STAFF COMMENTS
 36ITEM 5.
 OPERATING
  AND FINANCIAL REVIEW AND PROSPECTS
 365A.
 Operating
  Results
 365B.
 Liquidity
  And Capital Resources
 485C.
 Research
  And Development, Patents And Licenses, Etc
 495D.
 Trend
  Information
 495E.
 Off-Balance
  Sheet Arrangements
 505F.
 Tabular
  Disclosure Of Contractual Obligations
 505G.
 Safe
  Harbor
 50ITEM 6.
 DIRECTORS,
  SENIOR MANAGEMENT AND EMPLOYEES
 506A.
 Directors
  And Senior Management
 506B.
 Compensation
 526C.
 Board
  Practices
 546E.
 Share
  Ownership
 58ITEM 7.
 MAJOR
  SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
 627A.
 Major
  Shareholders
 627B.
 Related
  Party Transactions
 637C.
 Interests
  Of Experts And Counsel
 63ITEM 8.
 FINANCIAL
  INFORMATION
 638A.
 Consolidated
  statements And Other Financial Information
 638B.
 Significant
  Changes
 63ITEM 9.
 THE
  OFFER AND LISTING
 649A.
 Offer
  And Listing Details
 649B.
 Plan
  Of Distribution
 649C.
 Markets
 649D.
 Selling
  Shareholders
 649E.
 Dilution
 649F.
 Expenses
  Of The Issue
 64ITEM 10.
 ADDITIONAL
  INFORMATION
 6410A.
 Share
  Capital
 6410B.
 Memorandum
  of Incorporation
 6410C.
 Material
  Contracts
 6810D.
 Exchange
  Controls
 7010E.
 Taxation
 7210F.
 Dividends
  And Paying Agents
 7510G.
 Statement
  By Experts
 7510H.
 Documents
  On Display
 7510I.
 Subsidiary
  Information
 75ITEM 11.
 QUANTITATIVE
  AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
 75ITEM 12.
 DESCRIPTION
  OF SECURITIES OTHER THAN EQUITY SECURITIES
 7712A.
 Debt
  Securities
 7712B.
 Warrants
  and Rights
 7712C.
 Other
  Securities
 7712D
 American
  Depositary Shares
 77


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TABLE OF CONTENTSPART IIITEM
  13.
 DEFAULTS,
  DIVIDEND ARREARAGES AND DELINQUENCIES
 78ITEM
  14.
 MATERIAL
  MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS
 78ITEM
  15.
 CONTROLS
  AND PROCEDURES
 78ITEM
  16A.
 AUDIT
  COMMITTEE FINANCIAL EXPERT
 79ITEM
  16B.
 CODE
  OF ETHICS
 79ITEM
  16C.
 PRINCIPAL
  ACCOUNTANT FEES AND SERVICES
 79ITEM
  16D.
 EXEMPTIONS
  FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
 80ITEM
  16E.
 PURCHASES
  OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
 80ITEM
  16F
 CHANGE
  IN REGISTRANT'S CERTIFYING ACCOUNTANT
 80ITEM
  16G.
 CORPORATE
  GOVERNANCE
 80ITEM
  16H.
 MINE
  SAFETY DISCLOSURES
 80PART IIIITEM
  17.
 FINANCIAL
  STATEMENTS
 81ITEM
  18.
 FINANCIAL
  STATEMENTS
 81ITEM
  19.
 EXHIBITS
 82SIGNATURES
 85


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Preparation of Financial
Information  We are a South
African company and currently all our operations are located in South Africa.
Accordingly, our books of account are maintained in South African Rand.Our financial statements included in our
corporate filings are prepared in accordance with International Financial
Reporting Standards (IFRS), as issued by the International Accounting Standards
Board (IASB).  Our consolidated financial statements
included in this Annual Report are prepared in accordance with IFRS as issued
by the IASB. All financial information, except as otherwise noted is prepared
in accordance with IFRS as issued by the IASB.  We present our
financial information in rand, which is our presentation and reporting
currency.All references to “dollars” or “$” herein are to United
States Dollars and references to “rand” or “R” are to South African rands.Solely for your
convenience, this Annual Report contains translations of certain rand amounts
into dollars at specified rates. These rand amounts do not represent actual
dollar amounts, nor could they necessarily have been converted into dollars at
the rates indicated. Unless otherwise indicated, rand amounts have been
translated into dollars at the rate of R14.07 per $1.00, the year end exchange
rate on June 30, 2019.  In
this Annual Report, we present certain non-IFRS financial measures such as the
financial items “cash operating costs per kilogram”, “all-in sustaining costs
per kilogram” and “all-in costs per kilogram” which have been determined using
industry guidelines promulgated by the World Gold Council, which we use to
determine costs associated with producing gold, cash generating capacities of
the mines and to monitor performance of our mining operations. An investor should
not consider these items in isolation or as alternatives to, operating costs,
profit/(loss) for the year or any other measure of financial performance
presented in accordance with IFRS or as an indicator of our performance. While
the World Gold Council has provided definitions for the calculation of cash
operating costs, the calculation of cash operating costs per kilogram, all-in
sustaining costs per kilogram and all-in costs per kilogram may
vary significantly among gold mining companies, and these definitions by
themselves do not necessarily provide a basis for comparison with other gold
mining companies. See Glossary of Terms and Explanations and Item 5A. Operating
Results – “Cash operating costs, all-in sustaining costs and all-in costs” and
“Reconciliation of cash operating costs per kilogram, all-in sustaining costs
per kilogram, all-in costs per kilogram”.  DRDGOLD Limited  When used in this
Annual Report, the term the “Company” refers to DRDGOLD Limited and the terms
“we,” “our,” “us” or “the Group” refer to the Company and its subsidiaries,
associates and joint ventures, as appropriate in the context.  Acquisition of gold assets from Sibanye-Stillwater and
subsequent development and commissioning of FWGR Phase 1  On
July 31, 2018, we completed the acquisition of the gold assets associated with
Sibanye Gold Limited, trading as Sibanye-Stillwater’s (“Sibanye-Stillwater”)
West Rand Tailings Retreatment Project (“WRTRP”), subsequently renamed Far West
Gold Recoveries Proprietary Limited (“FWGR”).  This acquisition significantly
increased our assets and revenues and added 2.72 million ounces to our Ore
Reserves.  In connection with the acquisition, we issued to Sibanye-Stillwater
new shares in the Company equal to 38.05% of outstanding
shares, and granted Sibanye-Stillwater an option to acquire up to a total of
50.1% of our shares within a period of 2 years from the effective date of the
acquisition at a 10% discount to the prevailing market value (the
“Sibanye-Stillwater option”).  Construction of Phase 1 of FWGR commenced during August 2018 with
R330.7 million spent on,inter alia, the reconfiguration of the
Driefontein 2 plant (“DP2”) and relevant infrastructure to process tailings
from the Driefontein 5 slimes dam and deposit residues on the Driefontein 4
Tailings Storage Facility. During this construction phase, gold was produced at
the adjacent Driefontein 3 plant (“DP3”). Early-stage commissioning of the
reconfigured DP2 plant commenced in December, 2018 with the pumping of
reclaimed tailings into the carbon in leach (“CIL”) circuit. Testing of the
reconfigured plant and ramp-up of production continued during the third quarter
of the fiscal year ended June 30, 2019. Management considered,inter alia,
the design capacity of the plant, recoveries and the ability to sustain
production in determining the date of commercial production. The date of
commercial production for Phase 1 (excluding the milling section), which is the
date when preproduction costs, borrowing costs and revenue recognized during
the construction phase cease to be capitalised and depreciation commenced, was
determined to be April 1, 2019.  SpecialNote Regarding Forward-Looking Statements  This Annual Report
contains certain “forward-looking” statements within the meaning of Section 21E
of the U.S. Securities Exchange Act of 1934, regardingexpectedfuture
events or otherexpectedfuture financial performance and
information relating to us that are based on the beliefs of our management, as
well as assumptions made by and information currently available to our
management. Some of these forward-looking statements include phrases such as
“anticipates,” “believes,” “could,” “estimates,” “expects,” “intends,” “may,”
“should,” or “will continue,” or similar expressions or the negatives thereof
or other variations on these expressions, or similar terminology, or
discussions of strategy, plans or intentions, includingstatements in connection with, or relating to, among
other things: ·our reserve calculations and underlying assumptions; ·the trend information discussed in Item 5D.- Trend
Information, including target gold production and cash operating costs; ·estimated
future throughput capacity and production; ·expected
trends in our gold production as well as the demand for and the price of gold; ·our
anticipated labor, electricity, water, crude oil and steel costs; ·our
expectation
that existing cash will be sufficient to fund our operations in the next
12 months including our anticipated commitments; 1


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·estimated
production costs, cash operating costs per ounce, all-in
sustaining costs per ounce and all-in costs per ounce; ·expectations
on future gold price, supply and pricing trends including expected
impact of the global environment on gold prices; ·expected
gold production and cash operating costs expected in fiscal year 2020; ·our
prospects in litigation and disputes; ·statements
with respect to WRTRP assets acquired from Sibanye-Stillwater and the
option granted to Sibanye-Stillwater; ·statements
with respect to the legal review for increasing the deposition capacity of the
Brakpan/Withok TDF, and expected potential increase in capacity and life of
mine; and ·expected
effective gold mining tax rate.  Such statements reflect our current views with
respect to future events and are subject to risks, uncertainties and
assumptions. Many factors could cause our actual results, performance or
achievements to be materially different from any future results, performance or
achievements that may be expressed or implied by such forward-looking
statements, including, among others: ·adverse
changes or uncertainties in general economic conditions in South Africa; ·regulatory
developments adverse to us or difficulties in maintaining necessary licenses or
other governmental approvals; ·changes
in our competitive position; ·changes
in, or that affect our
business strategy; ·adverse changes in our
gold production as well as the demand for and the price of gold; ·any
major disruption in production at our key facilities; ·adverse
changes in foreign exchange rates; ·adverse
environmental changes; ·adverse
changes in ore grades and recoveries, and to the quality or quantity of
reserves; ·unforeseen
technical production issues, industrial accidents and theft; ·anticipated
or unanticipated capital expenditure on property, plant and equipment; ·future
performance relating to the WRTRP assets and whether or not the Sibanye-Stillwater
option is exercised; and ·various
other factors, including those set forth inItem
3D. Risk Factors.  For
a discussion of such risks, see Item 3D. Risk Factors. The risk factors
described in Item 3D. could affect our future results, causing these results to
differ materially from those expressed in any forward-looking statements. These
factors are not necessarily all of the important factors that could cause our
results to differ materially from those expressed in any forward-looking
statements. Other unknown or unpredictable factors could also have material
adverse effects on future results.  Investors
are cautioned not to place undue reliance on these forward‐looking
statements, which speak only as of the date thereof. We do not undertake any
obligation to update publicly or release any revisions to these forward‐looking
statements to reflect events or circumstances after the date of this Annual
Report or to reflect the occurrence of unanticipated events.  SpecialNote Regarding Links to External, or Third-party
Websites  Links to external, or
third-party websites, are provided solely for convenience. We take no
responsibility whatsoever for any third-party information contained in such
third-party websites, and we specifically disclaim adoption or incorporation by
reference of such information into this report.  Imperial units of measure and metric equivalents  The table below
sets forth units stated in this document, which are measured in Imperial and Metric.  Metric
 Imperial
 Imperial
 Metric1
  metric tonne
 1.10229
  short tons
 1
  short ton
 0.9072
  metric tonnes1
  kilogram
 2.20458
  pounds
 1
  pound
 0.4536
  kilograms1
  gram
 0.03215
  troy ounces
 1
  troy ounce
 31.10353
  grams1
  kilometer
 0.62150
  miles
 1 mile
 1.609
  kilometers1
  meter
 3.28084
  feet
 1
  foot
 0.3048
  meters1
  liter
 0.26420
  gallons
 1
  gallon
 3.785
  liters1
  hectare
 2.47097
  acres
 1
  acre
 0.4047
  hectares1
  centimeter
 0.39370
  inches
 1
  inch
 2.54
  centimeters1
  gram/tonne
 0.0292
  ounces/ton
 1 ounce/ton
 34.28
  grams/tonnes0
  degree Celsius
 32
  degrees Fahrenheit
 0
  degrees Fahrenheit
 - 18
  degrees Celsius
 2


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Glossary
  of Terms and ExplanationsThe table below sets forth a glossary of terms used in this
  Annual Report:Adjusted EBITDA
 Adjusted
  EBITDA means earnings before interest, tax, depreciation, amortisation,
  share-based payment expense, change in estimate of environmental
  rehabilitation recognised in profit or loss, gain/(loss) on disposal of
  property, plant and equipment, gain/(loss) on financial instruments and
  retrenchment costs. This is a non-IFRS financial measure and should not be
  considered a substitute measure of net income reported by us in accordance
  with IFRS.Administration expenses and other costs excluding non-recurring
  items
 Administration
  expenses and other costs excluding loss on disposal of property, plant and
  equipment and transaction costs.All-in sustaining costs per kilogram
 All-in
  sustaining costs is a measure on which guidance is provided by the World Gold
  Council and include cash operating costs of production, plus movement in gold
  in process on a sales basis, corporate administration expenses and other
  (costs)/income, the accretion of rehabilitation costs and sustaining capital
  expenditure. Costs other than those listed above are excluded. All-in
  sustaining costs per kilogram are calculated by dividing total all-in
  sustaining costs by kilograms of gold produced. This is a non‐IFRS
  financial measure and should not be considered a substitute measure of costs
  and expenses reported by us in accordance with IFRS.All-in costs per kilogram
 All-in
  costs is a measure on which guidance is provided by the World Gold Council
  and include all-in sustaining costs, retrenchment costs, care and maintenance
  costs, ongoing rehabilitation expenditure, growth capital expenditure and
  capital recoupments. Costs other than those listed above are excluded. All-in
  costs per kilogram are calculated by dividing total all-in costs by kilograms
  of gold produced. This is a non‐IFRS financial measure and should not
  be considered a substitute measure of costs and expenses reported by us in
  accordance with IFRS.Assaying
 The
  chemical testing process of rock samples to determine mineral content.$/oz
 US dollar
  per ounce.Called gold content
 The
  theoretical gold content of material processed.Capital expenditure
 Purchases
  of property, plant and equipment paid in cash.Care and maintenance
 Costs
  to ensure that the Ore Reserves are open, serviceable and legally compliant
  after active mining activity at a shaft has ceased.Cash operating costs of production
 Cash
  operating costs of production are operating costs less ongoing rehabilitation
  expenses, care and maintenance costs and net other operating costs/(income).
  This is a non‐IFRS financial measure and should not be considered a
  substitute measure of costs and expenses reported by us in accordance with
  IFRS.Cash operating costs per kilogram
 Cash
  operating costs are operating costs incurred directly in the production of
  gold and include labor costs, contractor and other related costs, inventory
  costs and electricity costs. Cash operating costs per kilogram are calculated
  by dividing cash operating costs by kilograms of gold produced. This is a
  non‐IFRS financial measure and should not be considered a substitute
  measure of costs and expenses reported by us in accordance with IFRS.Cut‐off grade
 The
  minimum in-situ grade of ore blocks for which the cash operating costs per
  ounce, excluding overhead costs, are equal to a projected gold price per
  ounce.CIL Circuit
 Carbon-in-leach
  circuit.Depletion
 The
  decrease in the quantity of ore in a deposit or property resulting from
  extraction or production.Deposition
 Deposition
  is the geological process by which material is added to a landform or land
  mass. Fluids such as wind and water, as well as sediment flowing via gravity,
  transport previously eroded sediment, which, at the loss of enough kinetic
  energy in the fluid, is deposited, building up layers of sediment. Deposition
  occurs when the forces responsible for sediment transportation are no longer
  sufficient to overcome the forces of particle weight and friction, creating a
  resistance to motion.Doré
 Unrefined
  gold and silver bullion bars consisting of approximately 90% precious metals
  which will be further refined to almost pure metal.Grade
 The
  amount of gold contained within auriferous material generally expressed in
  ounces per ton or grams per tonne of ore.Growth capital expenditure
 Capital
  expenditures that are not sustaining capital expenditure. This is a
  non‐IFRS financial measure and should not be considered a substitute
  measure of costs and expenses reported by us in accordance with IFRS.g/t
 Grams
  per tonne.Metallurgical plant
 A
  processing plant (mill) erected to treat ore and extract the contained gold.Mine call factor
 The
  gold content recovered expressed as a percentage of the called gold content.Mt
 Million
  tons.Ore
 A
  mixture of valuable and worthless materials from which the extraction of at
  least one mineral is technically and economically viable.Other operating costs / (income)
 Expenses
  incurred, and income generated in the course of operating activities, which
  are not directly attributable to production activities.Pay-limit
 The
  minimum in-situ grade of ore blocks or sites for which cash operating costs,
  including all overhead costs, are equal to a projected gold price per ounce.Operating costs
 Operating
  costs are cost of sales less depreciation, change in estimate of
  rehabilitation provision, movement in gold in process and retrenchment costs.Proven Ore Reserves
 Reserves
  for which (a) the quantity is computed from dimensions revealed in outcrops,
  trenches, workings or drill holes; grade and/or quality are computed from the
  results of detailed sampling and (b) the sites for inspection, sampling and
  measurement are spaced so closely and the geologic character is so well
  defined that size, shape, depth, and mineral content of Ore Reserves are well
  established.Probable Ore Reserves
 Reserves
  for which quantity and grade and/or quality are computed from information
  similar to that used for Proven Ore Reserves, but the sites for inspection,
  sampling, and measurement are farther apart or are otherwise less adequately
  spaced. The degree of assurance, although lower than that for Proven Ore
  Reserves, is high enough to assume continuity between points of observation.oz/t
 Ounces
  per ton.Refining
 The
  final purification process of a metal or mineral.Rehabilitation
 The
  process of restoring mined land to a condition approximating its original
  state.Reserves
 That
  part of a mineral deposit which could be economically and legally extracted
  or produced at the time of the reserve determination.Sediment
 The
  deposition of solid fragmental material that originated from weathering of
  rocks and was transported from a source to a site of deposition.Slimes
 The
  tailings discharged from a processing plant after the valuable minerals have
  been recovered.Sustaining capital expenditure
 Sustaining
  capital expenditure are those capital expenditures that are necessary to
  maintain current gold production. This is a non‐IFRS financial measure
  and should not be considered a substitute measure of costs and expenses
  reported by us in accordance with IFRS.t’000
 Tonnes
  in thousands.Tailings
 Finely
  ground rock from which valuable minerals have been extracted by milling, or
  any waste rock, slimes or residue derived from any mining operation or
  processing of any minerals.Tailings dam
 A dam
  created from waste material of processed ore after the economically
  recoverable gold has been extracted.Tonnage/Tonne
 Quantities
  where the metric tonne is an appropriate unit of measure. Typically used to
  measure reserves of gold‐bearing material in‐situ or quantities
  of ore and waste material mined, transported or milled.Tpm
 Tonne
  per month.Yield
 The
  amount of recovered gold from production generally expressed in ounces or
  grams per ton or tonne of ore.
 3


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4


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PART I  ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS  Not applicable.  ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE  Not applicable.  ITEM 3. KEY INFORMATION  3A. SELECTED FINANCIAL DATA  The following
selected consolidated financial data as at June 30, 2019 and 2018 and for the
years ended June 30, 2019, 2018 and 2017 is derived from our consolidated
financial statements set forth elsewhere in this Annual Report, which have been
prepared in accordancewith IFRS, as issued by the IASB. These consolidated financial statements have
been audited by KPMG Inc.  The selected consolidated financial data as at June
30, 2017, 2016 and 2015, and for the years ended June 30, 2016 and 2015 is
derived from audited consolidated financial statements not appearing in this
Annual Report which have been prepared in accordance withIFRS,as issued by the IASB. The selected consolidated
financial data set forth below should be read in conjunction with Item 5.
Operating and Financial Review and Prospects and with the consolidated
financial statements and the notes thereto and the other financial information
appearing elsewhere in this Annual Report. 5


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Selected Consolidated Financial Data(in millions, except share, per share and ounce data)Year ended June 30,20191
 2019
 2018
 2017
 2016
 2015$’m
 R'm
 R'm
 R'm
 R'm
 R'mProfit or loss DataRevenue
 196.3
 2,762.1
 2,490.4
 2,339.9
 2,433.1
 2,105.3Results from operating activities
 8.9
 125.2
 52.0
 (24.6)
 119.6
 94.9Profit/(loss) for the year attributable to equity owners of the
  parent
 5.6
 78.5
 6.5
 13.7
 61.9
 67.8Adjusted EBITDA2
 18.1
 254.1
 -2
 -2
 -2
 -2Per Share DataBasic earnings/(loss) per share (cents)
 0.8
 11.8
 1.5
 3.2
 14.7
 17.4Diluted earnings/(loss) per share (cents)
 0.8
 11.5
 1.5
 3.2
 14.7
 17.4Dividends proposed per share for the year (ZAR cents)
 
 20.0
 5.0
 5.0
 62.0
 10.0Dividends proposed per American Depositary Shares for the
  year         (USD cents)
 
 16.7
 3.6
 3.8
 45.2
 6.5Exchange rate (USD1:ZAR)1
 
 14.07
 13.72
 13.05
 14.68
 13.82Intraday high (USD1:ZAR)
 
 15.69
 14.57
 14.75
 16.87
 12.58Intraday low (USD1:ZAR)
 
 13.07
 11.50
 12.42
 12.24
 10.50Number of shares issued as at June 30
 696,429,767
 696,429,767
 431,429,767
 431,429,767
 431,429,767
 430,883,767Statement of financial position dataTotal assets
 288.5
 4,059.9
 2,360.5
 2,287.4
 2,419.1
 2,503.0Equity (Net assets)
 191.0
 2,688.5
 1,267.2
 1,302.4
 1,339.6
 1,529.9Ordinary share capital3
 360.4
 5,072.3
 4,177.2
 4,177.2
 4,177.2
 4,180.92019
 2019
 2019
 2019
 2019
 2019September
 August
 July
 June
 May
 AprilExchange Rate DataIntraday high (USD1:ZAR)
 15.29
 15.50
 14.38
 15.17
 14.89
 14.55Intraday low (USD1:ZAR)
 14.49
 14.32
 13.80
 14.06
 14.12
 13.861Translations into Dollars in this table are for the purpose of
  convenience only and are computed at the closing exchange rate at June 30,
  2019 of R14.07 per $1.00, or the annual average as noted. You should not view
  such translations as a representation that such amounts represent actual
  Dollar amounts. All other translations in this Annual Report are based on
  exchanges rates quoted by local financial institutions.  This line item has
  been prepared in accordance with Item 3.A(3) of Form 20-F.2Adjusted EBITDA is a non-IFRS financial measure. For a
  definition of Adjusted EBITDA see Glossary of Terms and Explanations.
  Adjusted EBITDA (that was included from the current reporting period
  following the Revolving Credit Facility ("RCF") agreement) may not
  be comparable to similarly titled measures of other companies. Adjusted
  EBITDA is not a measure of performance under IFRS and should be considered in
  addition to, and not as a substitute for, other measures of financial
  performance and liquidity.The
  Group considers adjusted EBITDA for the purpose of evaluating compliance with
  the covenants imposed by the Company’s RCF agreements entered into on August
  1, 2019 to finance the development of Phase 1 of FWGR and working capital
  requirements of the Group and subsequently partially used as a facility to
  provide a performance guarantee to Ekurhuleni Metropolitan Municipality
  (refer to Item 18: Financial Statements - Note 13 Cash and cash equivalents).
  The Group considers the presentation of Adjusted EBITDA provides useful
  information to investors. Adjusted EBITDA was not presented or considered
  previously by the Company.  For a reconciliation of Adjusted EBITDA to profit
  for the year, see Item 5.A. Operating and Financial Review and
  Prospects—Adjusted earnings before interest, interest, depreciation and
  amortization3Ordinary share capital as of June 30, 2019 is stated after the
  deduction of R51.0 million (2018 and 2017: R50.7 million) share capital
  relating to treasury shares held by the Group.
 6


---

3B. CAPITALIZATION
AND INDEBTEDNESS Not applicable.  3C. REASONS FOR THE OFFER AND USE OF PROCEEDS Not applicable.  3D. RISK FACTORS In
conducting our business, we face many risks that may interfere with our
business objectives. Some of these risks relate to our operational processes,
while others relate to our business environment. It is important to understand
the nature of these risks and the impact they may have on our business,
financial condition and operating results. Some of these risks are summarized
below and have been organized into the following categories: ·Risks related to our business and operations; ·Risks related to the gold mining industry; ·Risks related to doing business in South Africa; and ·Risks
related to ownership in our ordinary shares or American Depositary Shares
(ADSs).  Risks
related to our business and operations  Changes in the market price for gold, which in the past
has fluctuated widely, and exchange rate fluctuations affect the profitability
of our operations and the cash flows generated by those operations.  Due
to the marginal nature of our operations any sustained decline in the market
price of gold would adversely affect us, and any decline in the price of gold
below the cost of production could result in the closure of some or all of our
operations which would result in significant costs and expenditure, such as,
incurring retrenchment costs earlier than expected which could lead to
a decline in profits, or losses. In addition, as most of our production
costs are in rands, while gold is sold in dollars and then converted to rands,
our results of operation and financial condition have been and could be in the
future materially affected by an appreciation in the value of the rand. Accordingly,
any sustained decline in the price of gold and/or the strengthening of the
South African rand against the dollar would negatively and adversely affect our
business, operating results and financial condition.  Although we entered into a gold price hedge in fiscal
2019, we typically do not enter into forward contracts to reduce
our exposure to market fluctuations in the dollar gold price or the exchange
rate movements of the rand. We sell gold at spot prices based on the afternoon
London Bullion Market fixing price on the day when Rand Refinery, acting as an
agent for the sale of all gold produced by the Group, delivers the Gold to the
buyer. We sell our foreign currency at the spot price in the market on the date
of trade. If the dollar gold price should fall and/or the rand should
strengthen against the dollar, this would adversely affect us, and we may
experience losses, and if these changes result in revenue below our cost of
production and remain at such levels for any sustained period, we may be forced
to curtail or suspend some or all our operations. We might not be able to
recover any losses we may incur during that period or maintain adequate gold
reserves for future exploitation.  Exchange
rates are influenced by global economic trends. The closing exchange rate of the
rand against the dollar at June 30, 2019 weakened by 3% compared to June 30,
2018. The closing price of the rand against the dollar at June 30, 2018
weakened by 5% compared to June 30, 2017. At September 30, 2019 the rand traded
at R15.13 = $1.00 (based on closing rates), a 8% weakening of the rand against
the Dollar from June 30, 2019.  A
decrease in the dollar gold price and/or a strengthening of the rand against
the dollar results in a decrease in our profitability. For all periods
presented, all of our production was from South Africa. If the rand was to
appreciate against the dollar for a continued time, our operations could experience
a reduction in cash flow and profitability and thiswould adversely
affect our business, operating results and financial condition.  A
failure to acquire new Ore Reserves could negatively affect our future cash
flow, results of operations and financial condition.  New or
ongoing exploration programs may not result in new mineral producing operations
that will sustain or increase our Ore Reserves. A failure to acquire new Ore
Reserves in sufficient quantities and quality to maintain or grow the current
level and quality of our reserves will negatively affect our future cash flow,
results of operations and financial condition.In addition, if we are unable to identify Ore Reserves that have
reasonable prospects for economic extraction while maintaining sufficient
controls on production and other costs, this will have a material effect on the
future viability of our operations.  While we have been able to increase
reserves in the prior three fiscal years—See Item 4B. “Business Overview—Ore
Reserves”—such increases were dependent upon acquisitions and  successful
drilling programs, and such increases were offset by depletions  Accordingly,
we may not be successful in increasing reserves in future years and our
reserves could decrease.  We
may be unable to make desirable acquisitions or to integrate successfully any
businesses we acquire, including the acquisition of the FWGR assets  Our
future success may depend in part on the acquisition of businesses or
technologies intended to complement, enhance or expand our current business or
products or that might otherwise offer us growth opportunities. The ability to
complete such transactions may be hindered by a number of factors, including identifying acquisition targets, obtaining necessary
financing and potential difficulties in obtaining government approvals.
Any acquisitions we make,
such as our acquisition of the FWGR assets from Sibanye-Stillwater effective
from July 31, 2018, could fail to achieve our financial or strategic objectives,
disrupt our ongoing business and adversely impact our results of operations. 7


---

Any acquisition that we do make would
pose risks related to the integration of the new business or technology with
our business and organization. We cannot be certain that we will be able to
achieve the benefits we expect from a particular acquisition or investment.
Acquisitions may also strain our managerial and operational resources, as the
challenge of managing new operations may divert our management from day-to-day
operations of our existing business. Furthermore, we may have difficulty
integrating employees, business systems, and technology. The controls,
processes and procedures of acquired businesses may also not adequately ensure
compliance with laws and regulations and we may fail to identify compliance
issues or liabilities. Our business, financial condition and results of
operations may be materially and adversely affected if we fail to coordinate
our resources effectively to manage both our existing operations and any
businesses we acquire.  Acquisitions can also result in unforeseen liabilities.  Moreover, our resources are limited and
our decision to pursue a transaction has opportunity costs; accordingly, if we
pursue a particular transaction, we may need to forgo the prospect of entering
into other transactions that could help us achieve our financial or strategic
objectives.  Our
large projects, most notably the development of FWGR, are subject to schedule
delays and cost overruns, and we may face constraints in financing our existing
projects or new business opportunities, which could render our projects
unviable or less profitable than planned  The
development of our projects are capital intensive processes carried out over
long durations and requires us to commit significant capital expenditure and
allocate considerable management resources in utilising our existing experience
and know-how.  Projects
like the development of FWGR is subject to the risk of delays and cost overruns
which are inherent in any large construction project including,inter alia: •  shortages
or unforeseen increases in the cost of equipment, labor and raw materials; •  unforeseen
design and engineering problems; •  unforeseen
construction problems; •  unforeseen
delays commissioning sections of the project. For example: FWGR Phase 1 date
achieved commercial production on April 1, 2019 and the mills were commissioned
in September 2019 (both initially planned for January 1, 2019); •  inadequate
phasing of activities; •  labor
disputes; •  inadequate
workforce planning or productivity of workforce; •  inadequate
management practices; •  natural
disasters and adverse weather conditions; •  failure
or delay of third-party service providers; and •  changes
to regulations, such as environmental regulations.  In
addition, if the assumptions we make in assessing the viability of our
projects, including those relating to commodity prices, exchange rates,
interest rates, inflation rates and discount rates,
prove to be incorrect or need to be significantly revised, this may adversely affect the profitability or even the
viability of our projects.  As
the development of FWGR is particularly material to DRDGOLD, significant cost
overruns or adverse changes in assumptions affecting the viability of the
project could have a material adverse effect on our business, cash flows,
financial condition and prospects. The uncertainty and volatility in the gold market
makes it more difficult to accurately evaluate the project economics and
increases the risk that the assumptions underlying our assessment of the
viability of the project may prove incorrect.  Our
operating cash flow and banking facilities may be insufficient to meet our
capital expenditure plans and requirements, depending on the timing and cost of
development of our existing projects and any further projects we may pursue, as
well as our operating performance and the utilisation of our banking
facilities. As a result, new sources of capital may be needed to meet the
funding requirements of these projects and to fund ongoing business activities.
Our ability to raise and service significant new sources of capital will be a
function of macroeconomic conditions, our credit rating, our gearing and other
risk metrics, the condition of the financial markets, future gold prices, the
prospects for our industry, our operational performance and operating cash flow
and debt position, among other factors.  In
the event of operating or financial challenges, any dislocation in financial
markets or new funding limitations, our ability to pursue new business
opportunities, invest in existing and new projects, fund our ongoing business
activities and pay dividends, could be constrained, any of which could have a
material adverse effect on our business, operating results cash flows and
financial condition.  We
may not be able to meet our cash requirements because of a number of factors,
many of which are beyond our control.  Management’s
estimates on future cash flows are subject to risks and uncertainties, such as
the rand gold price, production volumes, recovered grades and costs. If we are
unable to meet our cash requirements out of cash flows generated from our
operations, we would need to fund our cash requirements from financing and any
such financing may be permitted under the terms of our financing arrangements,
or may not be available on acceptable terms, or at all.If we do not generate sufficient
cash flows or have access toadequate financing,
our ability to respond to changing business and economic conditions, make
future acquisitions, react to adverse operating results, meet our debt service
obligations and fund required capital expenditures or meet our working capital
requirements may be adversely affected.  Any
interruption in gold production at any of our two mining operations generating
cash flows, will have an adverse effect on the Company.  8


---

As at June 30, 2019 and September 30,
2019 respectively, we have two mining operations generating cash flows, namely
Ergo and FWGR.  Ergo’s
reclamation sites, processing plants, pump stations and the Brakpan/Withok Tailings
Storage Facility ("Brakpan/Withok TSF") are linked through pipeline
infrastructure. The Ergo plant is currently our major processing plant.  FWGR’s
reclamation site, processing plant, pump stations and the Driefontein 4
Tailings Storage Facility are linked through pipeline infrastructure. DP 2 plant is currently our processing plant and FWGR.  Our
reclamation sites, plants, pipelines infrastructure and the deposition/storage
facilities are exposed to numerous risks, including operational down time due
to planned or unplanned maintenance, destruction of infrastructure, spillages,
higher than expected operating costs, or lower than expected production as a
result of decreases in extraction efficiencies due to imbalances in the
metallurgical process as well as inconsistent volume throughput or other factors.  Our
operations are also exposed to severe weather events that could interrupt
production. It is believed that the long-term upward trend in global
temperature is directly correlated with the increase in global severe weather
events both in terms of magnitude and frequency.  For example, dry weather
conditions and a recent spate of heatwaves in the Johannesburg area in October
2019 has prompted level 2 water restrictions on residential water users.  Severe
thunderstorms and high winds, especially during the summer rainy season, may
also cause damage to operation infrastructure that may in turn cause an
interruption in the production of gold.  Such incidents and other weather
events may damage the facility and cause the interruption of deposition and
gold production until the facility is repaired or alternative deposition is
brought on line.  Each
of theseor
other weatherconditionsor other interruptionscould
have a material adverse effect on our business, operating results and financial
condition.  An increase in production costs could have an adverse
effecton our results of operations.  An increase in our
production costs will impact our results of
operations. Production costs are affected by,inter alia: •
 labor stability, productivity and increases in labor costs; •
 increases in electricity and water prices; •
 increases in crude oil and steel prices; •
 changes in regulation; •
 unforeseen changes in ore grades and recoveries; •
 unexpected changes in the quality or quantity of reserves; •
 technical production issues; •
 availability and cost of smelting and refining arrangements; •
 environmental and industrial accidents; •
 gold theft; •
 environmental factors; and •
 pollution.  Our production costs consist mainly of materials
including reagents and steel, labor, electricity, specialized service providers,
water, fuels, lubricants and other oil and petroleum based products. Production
costs have in the past, and could in the future, increase at rates in excess of
our annual inflation rate and impact
our results of operation and can result in
the restructuring of these operations at substantial cost.  On September 16, 2019, Ergo signed a two-year
wage agreement with the Majority Unions for anaverage increase of 5.9% per annum
across our workforcewith individual increasesranging from 5.5% to 7%
per annum, with the intention to extend this agreement to a third
year.  As part of the
transitional arrangements at FWGR, a three-year wage agreement is in place and is
scheduled to conclude in June 2021.  Increases in production costs, if material, will
adversely impact our results of operations.  In addition, any initiatives that
we pursue to reduce costs, such as reducing our labor force, a reduction of the
corporate overhead, negotiating lower price
increases for consumables and cost controls may not be successful or sufficient
to offset the increases affecting our operations and could adversely affect our
business, operating results and financial condition.  Flooding
at our discontinued underground operations may cause us to incur liabilities
for environmental damage.  If the rate of rise of water is not
controlled, water fromour abandoned underground mining areascould potentially rise and come into contact with
naturally occurring underground water or decant into surrounding undergroundmining areasand could ultimately also rise to surface. Progressive
flooding of theseabandoned underground mining areasand surrounding undergroundmining areascould
eventually cause the discharge of polluted water to the surface and to local
water sources.  Should
underground water levels not reach a natural subterranean equilibrium, and if
underground water rises to the surface, we, together with all other mining
companies in those areas, may face claims relating to environmental damage.  Any such claims may have a
material adverse effect on our business, operating results and financial
condition. 9


---

Our operations are subject to extensive environmental
regulations which could impose significant costs and liabilities.  Our
operations are subject to increasingly extensive laws and regulations governing
the protection of the environment under various state, provincial and local
laws, which regulate air and water quality, hazardous waste management and
environmental rehabilitation and reclamation.Our mining and
related activities have the potential to impact the environment, including
land, habitat, streams and environment near the mining sites.Failure to comply with environmental laws or
delays in obtaining, or failures to obtain government permits and approvals may
adversely impact our operations. In addition, the regulatory environment in
which we operate could change in ways that could substantially increase costs
of compliance, resulting in a material adverse effect on our profitability.  We
have incurred, and expect to incur in the future, expenditures to comply with
theseenvironmentallaws and regulations. We have estimated our aggregate
group Provision for Environmental Rehabilitation at a net present value of R682.6 million
which is included in our statement of financial position as at June 30, 2019
(Refer to Item 18. ‘‘Financial Statements - Note 11 – Provision for
environmental rehabilitation”). However, the ultimate amount of rehabilitation
costs may in the future exceed the current estimates due to factors beyond our
control, such as changing legislation, higher than expected cost increases, or
unidentified rehabilitation costs. We fund these environmental rehabilitation
costs by making contributions over the life of the mine to environmental trust
funds or funds held in insurance instruments established for our operations. If
any of our operations are prematurely closed, the rehabilitation funds may be
insufficient to meet all the rehabilitation obligations of those operations.
The closure of mining operations, without sufficient financial provision for
the funding of rehabilitation liabilities, or unacceptable damage to the
environment, including pollution or environmental degradation, may expose us
and our directors to prosecution, litigation and potentially significant
liabilities.  Damage
to tailings dams and excessive maintenance and rehabilitation costs could
result in lower production and health, safety and environmental liabilities.  Our tailings facilities are exposed to numerous risks and
events, the occurrence of which may result in the failure, breach or damage of
such a facility. These may include sabotage, failure by our employees to adhere
to the codes of practice and natural disasters such as excessive rainfall and seismic
events, any of which could force us to stop or limit operations. In addition,
the dams could overflow or a side wall could collapse and the health and safety
of our employees and communities living around these dams could be jeopardized.
In the event of damage to our tailings facilities, our operations will be
adversely affected and this in turn could have a material adverse effect on our
business, operating results and financial condition.  Due to the nature of our business, our operations face
extensive health and safety risks.  Gold mining is exposed to numerous risks and events, the
occurrence of which may result in the death of, or personal injury, to
employees. According to section 54 of the Mine, Health and Safety Act of 1996,
if an inspector believes that any occurrence, practice or condition at a mine
endangers or may endanger the health or safety of any person at the mine, the
inspector may give any instruction necessary to protect the health or safety of
persons at the mine. These instructions could include the suspension of
operations at the whole or part of the mine. Health and safety incidents could
lead to mine operations being halted and that willincrease our unit production
costs,which could have a material adverse effect on our
business, operating results and financial condition.  Events may occur for which we are not insured
which could affect our cash flows and profitability.  Because of the nature of our business, we may become subject
to liability for pollution or other hazards against which we are unable to
insureor are not insured, including those in respect of past
mining activities. Our existing property, business interruption and other
insurance contains certain exclusions and limitations on coverage. The insured
value for property and loss of profits due to business interruptionis R11.35 billion,with a total loss limit of R650 million for the 2020 fiscal
year. Business interruption is only covered from the time the loss occurs and
is subject to time and amount deductibles that vary between categories. To cover legal liability to
third parties for damage, injury, illness or death a total of R1.5 billion
insurance cover is in place for the 2020 fiscal year,
subject to certain exclusions and limitations on coverage.  Insurance coverage may not cover the
extent of claims brought against us, including claims for environmental,
industrial or pollution related accidents, for which coverage is not available.
If we are required to meet the costs of claims, which exceed our insurance
coverage, this could have a material adverse effect on our business, operating
results and financial condition.  If we are unable to attract and retain key personnel our
business may be harmed.  The
success of our business will depend, in large part, upon the skills and efforts
of a small group of management and technical personnel including the positions
of Chief Executive Officer and Chief Financial Officer.In addition, we
compete with mining and other companies on a global basis to attract and retain
key human resources at all levels with appropriate technical skills and
operating and managerial experience necessary to operate the business.Factors critical to retaining our present staff and
attracting additional highly qualified personnel include our ability to provide
these individuals with competitive compensation arrangements, and other
benefits. If we are not successful in retaining or attracting highly qualified
individuals in key management positions, our business may be harmed. We do not
maintain “key man” life insurance policies on any members of our executive
team. The loss of any of our key personnel could delay the execution of our
business plans, which may result in decreased production, increased costs and
decreased profitability.  We are subject to operational risks associated with our flotation and
fine-grind (FFG) project.  Our
flotation and fine-grind project, implemented in fiscal
year 2014, is designed to improve extraction efficiencies. 10


---

Production
was temporarily suspended in April, 2014 due to unsatisfactory gold recoveries
and low carbon absorption efficiencies. The established Low-Grade Section was
brought back to steady state and gold production stabilized during the last
quarter of fiscal year 2014 and became fully operational in February 2015,
treating the remainderof the Ergo plant
throughput through the FFG from this date.  The
FFG project remains exposed to numerous risks associated with similar projects,
including operational down time due to unplanned maintenance, destruction of
infrastructure, spillages, higher than expected operating costs, or lower than
expected production which could have a material adverse effect on our business,
operating results and financial condition.  The
operation of the FFG circuit was temporarily halted in the first quarter of
fiscal 2020 to perform an evaluation and compare the additional revenues earned
from extracting additional gold from the most recently integrated reclamation
sites compared to the cost incurred to operate the FFG circuit. The evaluation
also includes considering alternative configurations of the FFG circuit and
alternative means of extracting gold using the FFG circuit. At the date of this
report, the evaluation is ongoing.  A disruption in our information technology systems,
including incidents related to cyber security, could adversely affect our
business operations.  We rely on the accuracy, availability and security of our
information technology systems. Despite the measures that we have implemented,
including those related to cyber security, our systems could be breached or
damaged by computer viruses and systems attacks, natural or man-made incidents,
disasters or unauthorized physical or electronic access.  Any system failure, accident or security
breach could result in business disruption, theft of our intellectual property,
trade secrets (including our proprietary technology), unauthorized access to,
or disclosure of, personnel or supplier information, corruption of our data or
of our systems, reputational damage or litigation. We may also be required to
incur significant cost to protect against or repair the damage caused by these
disruptions or security breaches in the future, including, for example,
rebuilding internal systems, implementing additional threat protection
measures, defending against litigation, responding to regulatory inquiries or
actions, paying damages, or taking other remedial steps with respect to third
parties.  These threats are constantly evolving,
thereby increasing the difficulty of successfully defending against them or
implementing adequate preventative measures and we remain subject to additional
known or unknown threats. We are subject to
cybersecurity attacks from time to time, and have been subject to phishing. In some instances, we may be unaware of an incident or
its magnitude and effects. We may be susceptible to new and emerging risks,
including cyber-attacks and phishing, in the evolving landscape of
cybersecurity threats.  In addition, from time to time, we implement
updates to our information technology systems and software, which can disrupt
or shutdown our information technology systems. Information technology system
disruptions, if not appropriately mitigated, could have a material adverse
effect on our operations.  Risks
related to the gold mining industry  A
change in the dollar price of gold, which in the past has fluctuated widely, is
beyond our control.  Historically, the gold price has fluctuated widely and is
affected by numerous industry factors over which we have no control including: •  a significant amount
of above-ground gold in the world that is used for trading by investors; •  the physical supply of gold from world-wide production
and scrap sales, and the purchase, sale or divestment by central banks of their
gold holdings; •  the demand for gold for investment purposes,
industrial and commercial use, and in the manufacturing of jewelry; •  speculative trading activities in gold; •  the overall level of forward sales by other gold
producers; •  the overall level and cost of production of other gold
producers; •  international or regional political and economic
events or trends; •  the strength of the dollar (the currency in which gold
prices generally are quoted) and of other currencies; •  financial market expectations regarding the rate of
inflation; •  interest rates; •gold
hedging and de-hedging by gold producers; and •actual
or expected gold sales by central banks and the International Monetary Fund.  During
fiscal year 2019 the gold price reached a high of U$1,439 per ounce and a low
of U$1,160. Our profitability may be negatively impacted by a decline in the
gold price as we incur losses when revenue from gold sales drops below the cost
of production for an extended period.  The
exploration of mineral properties is highly speculative in nature, involves
substantial expenditures, and is frequently unproductive.  Exploration
is highly speculative in nature and requires substantial expenditure for
drilling, sampling and analysis of ore bodies to quantify the extent of the
gold reserve.Many gold exploration
programs, including some of ours, do not result in the discovery of
mineralization and any mineralization discovered may not be of sufficient
quantity or quality to be mined profitably. If we discover a viable deposit, it
usually takes several years from the initial phases of exploration until
production is possible.During this time, the economic feasibility of
production may change. 11


---

Moreover,
we rely on the evaluations of professional geologists, geophysicists, and
engineers for estimates in determining whether to commence or continue mining.
These estimates generally rely on scientific and economic assumptions, which in
some instances may not be correct, and could result in the expenditure of
substantial amounts of money on a deposit before it can be determined with any
degree of accuracy whether the deposit contains economically recoverable
mineralization. Uncertainties as to the metallurgical recovery of any gold
discovered may not warrant mining based on available technology.  Our future growth and profitability will depend,
in part, on our ability to identify and acquire additional mineral rights, and
on the costs and results of our continued exploration and development programs.Our business focuses mainly on the extraction of gold from tailings,
which is a volume driven exercise. Only significant deposits within proximity
of services and infrastructure that contain adequate gold content to justify
the significant capital investment associated with plant, reclamation and deposition
infrastructure are suitable for exploitation in terms of our model. There is a
limited supply of these deposits which may inhibit exploration
and developments, especially in a declining gold price environment.  Because
of these uncertainties, we may not successfully acquire additional mineral
rights, or identify new Proven and Probable Ore Reserves in sufficient
quantities to justify commercial operations in any of our operations. The costs
incurred on exploration activities that do not identify commercially
exploitable reserves of gold are not likely to be recovered and therefore are likely
to be impaired.  There is
inherent uncertainty in Ore Reserve estimates.  Our
Ore Reserve figures described in this document are the best estimates of our
current management as of the dates stated and are reported in accordance with
the requirements of Industry Guide 7 of the SEC. These estimates may not
reflect actual reserves or future production.  Should
we encounter mineralization or formations different from those predicted by
past drilling, sampling and similar examinations, reserve estimates may have to
be adjusted and mining plans may have to be altered in a way that might
ultimately cause our reserve estimates to decline. Moreover, if the rand price
of gold declines, or stabilizes at a price that is lower than recent levels, or
those assumed in our mining plans, or if our labor, water, steel, electricity
and other production costs increase or recovery rates decrease, it may become
uneconomical to recover Ore Reserves, particularly those containing relatively
lower grades of mineralization. Under these circumstances, we would be required
to re-evaluate our Ore Reserves. Short-term operating factors relating to the
ability to reclaim our Ore Reserves, at the required rate, such as an
interruption or reduction in the supply of electricity or a shortage of water
may have the effect that we are unable to achieve critical mass, which may
render the recovery of Ore Reserve, or parts of the Ore Reserve no longer
feasible, which could negatively affect production rate and costs and decrease
our profitability during any given period. Estimates
of reserves are based on drilling results and because unforeseen conditions may
occur in these mine dumps that may not have been identified by the drilling
results, the actual results may vary from the initial estimates.These
factors have and could result in reductions in our Ore Reserve estimatesand as a result, our production, which
could in turn adversely impact the total value of our mining asset base and our
business, operating results and financial condition.  Gold
mining is susceptible to numerous events that could have an adverse impact on a
gold mining business.  The business of gold mining is exposed to
numerous risks and events, the occurrence of which mayresult in the
death of or personal injury to employees, the loss of mining and reclamation
equipment, damage to or destruction of mineral properties or production
facilities, monetary losses, delays in production, environmental damage, loss
of the license to mine and potential legal claims. The risks and events
associated with the business of gold mining include:  ·environmental hazards and pollution, including dust
generation, toxic chemicals, discharge of metals, pollutants, radioactive
materials and other hazardous material into the air and water; ·flooding, landslides, sinkhole formation, ground
subsidence, ground and surface water pollution and waterway contamination; ·a decrease in labor productivity due to labor
disruptions, work stoppages, disease, slowdowns or labor strikes; ·unexpected decline of ore grade; ·metallurgical conditions or
lower than expected gold recovery; ·failure of unproven or evolving technologies; ·mechanical failure or breakdowns and ageing
infrastructure; ·energy and electrical power supply interruptions; ·availability of water; ·injuries to employees or fatalities resulting from falls
from heights and accidents relating to mobile machinery or electrocution or other causes; ·activities of illegal or artisanal miners; ·material and equipment availability; ·legal and regulatory restrictions and changes to such
restrictions; ·social or community disputes or interventions; ·accidents caused from the collapse of tailings dams; ·pipeline failures and spillages; ·safety-related stoppages; and ·corruption,
fraud and theftincluding gold bullion
theft.  12


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The occurrence of any of these hazards could delay
production, increase production costs and may result in significant legal
claims and adversely impact our business results of operations
and financial condition.  Risks
related to doing business in South Africa  Political
or economic instability in South Africa may reduce our production and
profitability.  We
are incorporated in South Africa and all our operations are currently in South
Africa. As a result, political and economic risks relating to South Africa
could have a significant effect on our production and profitability. Large
parts of the South African population are unemployed and do not have access to
adequate education, health care, housing and other services, including water
and electricity. Government policies aimed at alleviating and redressing the
disadvantages suffered by most citizens under previous governments may increase
our costs and reduce our profitability. In recent years, South Africa has
experienced high levels of crime. These problems may impede fixed inward
investment into South Africa and increase emigration of skilled workers and as
a result, we may have difficulties retaining qualified employees.  Inflation
can adversely affect us.  The
inflation rate in South Africa is relatively high compared to developed,
industrialized countries. As of June 2019, the annual Consumer Price
Inflation Index, or CPI, stood at 4.5% compared to 4.6% in June 2018 and 5.1%
in June 2017. Annual CPI was 4.1%% as at September 30, 2019.Inflation in South
Africa generally results in an increase in our operational costs in rand,
unless such inflation is accompanied by a concurrent devaluation of the rand
against the dollar or an increase in the dollar price of gold. Higher and
sustained inflation in the future, with a consequent increase in operational
costs could have a material adverse effect on our results of operations and our
financial condition and could result in operations being discontinued or
reduced or rationalized,which could reduce
our profitability.  The treatment of occupational health diseases and the
potential liabilities related to occupational health diseases may have an
adverse effect on the results of our operations and our financial condition.  We may be subject to claims relating to occupational
health diseases and we are currently subject to a claim as described below.  In January 2013, DRDGOLD, East Rand Proprietary Mines
Limited  (“DRDGOLD Respondents”)
and 23 other mining companies (“Other Respondents”) (collectively referred to as "Respondents")
were served with a court application issued in the High Court of South Africa
for a class certification on behalf of former mineworkers and dependents of
deceased mineworkers (“Applicants”). In the application the Applicants allege that the
Respondents conducted underground mining operations in a negligent and
complicit manner causing the former mineworkers to contract occupational lung
diseases. [The Applicants have as yet not quantified the amounts which they are
demanding from the Respondents in damages.  On May 03, 2018, the Applicants and Anglo American South
Africa Limited, AngloGold Ashanti Limited, Sibanye Gold Limited trading as
Sibanye-Stillwater, Harmony Gold Mining Company Limited, African Rainbow
Minerals Limited and certain of their affiliates (“Settling Companies”) settled
the class certification application in which the Applicants in each sought to
certify class actions against gold mining houses cited therein on behalf of
mineworkers who had worked for any of the particular respondents and who suffer
from any occupational lung disease, including silicosis or tuberculosis.  The DRDGOLD Respondents, comprising DRDGOLD Limited and
East Rand Proprietary Mines Limited, are not a party to the settlement between
the Applicants and Settling Companies.  In December 2018, the Applicants and Settling Companies
approached the Gauteng Local Division of the High Court, Johannesburg on an ex
parte basis to make the settlement agreement an order of court.  The application was heard on 29 May 2019 and on 26 July
2019, the Gauteng Local Division of the High Court, Johannesburg approved the
settlement agreement.  The Settling Companies together with the Applicants have
established a settlement trust (named the Tshiamiso Trust) to administer the
benefits which have been estimated to be in the amount of R5 billion. There are
ten classes of claimants who, once properly certified, will be eligible for a
benefit.  The settlement agreement is not binding on the DRDGOLD
Respondents. The dispute, insofar as the class certification application and
appeal thereof is concerned, still stands and has not terminated in light of
the settlement agreement.  An adverse judgment in the claim described above or any
other claim could have an adverse impact on us.  We have experienced an increase in organised crime activities which has started
to target gold plants.  Recently,
a number of companies, including our Knights and Ergo plants, were subject to
armed attacks targeting the gold in the plants or high-grade gold bearing
material. These incidents were very well organised and in all the incidents the
thieves were armed. In some of the incidents employees of companies were also
held hostage until the targeted material was obtained. In the most recent
incident a security officer was fatally injured.  Any such incidents have and may still result in losses of
gold or other damage which could impact our business, financial results or 13


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condition.  Theft
at our sites, particularly of copper, may result in greater risks to employees
or interruptions in production.  Crime statistics in South Africa indicate an increase in
theft. This together with price increases for copper has resulted in theft of
copper cable. Our operations experience high incidents of copper cable theft
despite the implementation of security measures. In addition to the general
risk to employees’ lives in an area where theft occurs, we may suffer
production losses and incur additional costs as a result of power interruptions
caused by cable theft and theft of bolts used for the pipeline.  Power
stoppages or shortages or increases in the cost of power could negatively
affect our results and financial condition.  Our mining operations are dependent on electrical power
supplied by Eskom, South Africa’s state-owned utility company. As a result of
insufficient generating capacity, owing to poor maintenance and lagging capital
infrastructure investment, South Africa has faced significant disruptions in
electricity supply in the past and Eskom has warned that the country could
continue to face disruptions in electrical power supply in the foreseeable
future. During the first half of fiscal 2019, approximately 49kg of gold production
was lost due to power supply disruptions.  Eskom is currently experiencing financial difficulties
which include,inter alia, the chairman of the board citing serious
concerns around the power utility’s long-term viability and status as a going
concern as disclosed in its 2018 Integrated Report, a decrease in the demand
for its electricity from consumers and its growing outstanding debt owing from local
municipalities, who are both Eskom’s distribution agents and its largest customer.Accordingly,
the security of future power supply as well as the
cost thereof, remains a risk and may have major implications for our
operational process, which may result in significant production losses.  The country’s current reserve capacity may be
insufficient and the risk of electricity stoppages is expected to continue for
the foreseeable future. Supply interruptionsbecause of this as well as an
aging and poorly maintained distribution gridmay
pose a significant risk to the operations.  The group has
a load-curtailment agreement in place with Eskom in terms of which we reduce
power consumption by between 10% and 20% when the grid is under pressure, but
Eskom maintains uninterrupted power supply to the operations.  The group has installed auxiliary emergency power generation units
at its Brakpan plant to prevent the tripping of thickeners and to drive certain
key installations associated with the disposal of tailings. The option to
purchase these auxiliary emergency power generation units has become
exercisable but has not been exercised to date as management is evaluating
alternatives to structure the use of these auxiliary emergency power generation
units.  There is, however, no assurance that the measures will be sufficient
to completely mitigate the risk of power stoppages.  Electricity
tariffs increased as follows: from April 1, 2017 an average tariff increase of 13.9%
and from April 1, 2018 an average tariff increase of 9.4% and from April 1,
2019 an average tariff increase of 9.4%. The National
Energy Regulator of South Africa approved an average increase of 8.1% average
effective April 1, 2020 and an average increase of 5.2% effective April 1,
2021. These increases have had an adverse effect on our
production costs and similar or higher future increases could have a material
adverse effect on our operating results and financial condition.  Ergo is currently disputing the
electricity tariff charged by Ekurhuleni Metropolitan Municipality (refer toItem 18.“Financial
Statements - Note 26 – Contingent Assets and Liabilities”).   Scarcity of water may negatively affect our operations.  South Africa faces
water shortages, which may lead to the revision of
water usage strategies by several sectors in the South African economy,
including electricity generation and municipalities. This may result in
rationing or increased water costs in the future. Such changes would adversely
impact our surface retreatment operations, which use water to transport the
slimes or sand from reclaimed areas to the processing plant and to the tailings
facilities. In addition, as our gold plants and piping infrastructure were
designed to carry certain minimum throughputs, any reductions in the volumes of
available water may require us to adjust production at these operations.  DRDGOLD invested R22 million in the construction of a
filtration plant at the Rondebult Waste Water Works (operated by the East Rand
Water Care Company) to treat sewage water to reduce the use of potable water.This water is used both
to reclaim and carry production materials and also, ultimately, to irrigate
rehabilitation vegetation at a significantly lower cost than that of potable
water.The plant was commissioned in early fiscal year 2016 and has
capacity to provide Ergo with 10 Mega Litres (“Ml”) a day from the
Rondebult sewage treatment facility. However, due to the deterioration of the
local government authorities’ infrastructure, the expected quantity of sewerage
is not reaching the treatment facility and as a result Ergo is still not able
to extract the full design capacity of 10 Ml of water a day. It is not certain
if and when the flow of sewerage will reach expected
levels.  DRDGOLD installed new gland service infrastructure at the
Ergo plant during October 2016 to allow for the use of recycled process water
for gland service requirements. This initiative has resulted in the reduction
of approximately 70Ml a month in potable water use.  The Central Water Facility was commissioned at a cost of
R29.5 million during the last quarter of Fiscal year 2017 to store and
distribute water sourced from Rondebult waste water treatment works, treated
Acid Mine Drainage (“AMD”) water from Trans-Caledon Tunnel Authority 14


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(“TCTA”) and recycled water from our Brakpan/Withok Tailings
Storage Facility. The Centrally Located Water Facility is a closed circuit and
allows us to distribute water more efficiently throughout the operations.  As part of the Heads of agreement signed between EMO,
Ergo, ERPM and TCTA in December 2012,Ergo secured the
right to purchase up to 30Ml of partially treated AMD from TCTA at cost, in
order to reduce Ergo’s reliance on potable water for mining and processing
purposes. AMD water entered our system for the first time in fiscal year 2017.  These measures may not be sufficient to alleviate the water
scarcity issueswe
face.  Government
Regulation  Government policies in South Africa may
adversely impact our operations and profits.  The mining industry in South Africa is
extensively regulated through legislation and regulations issued through the
government’s administrative bodies. These involve directives in respect of
health and safety, the mining and exploration of minerals and managing the
impact of mining operations on the environment. A variety of permits and
authorities are required to mine lawfully, and the government enforces its
regulations through the various government departments.The
formulation or implementation of government policies may be discretionary and
unpredictable on certain issues, including changes in conditions for the
issuance of licenses insofar as social and labor plans are concerned,
transformation of the workplace, laws relating to mineral rights, ownership of
mining assets and the rights to prospect and mine, additional taxes on the
mining industry and in extreme cases, nationalization. A change in regulatory
or government policies could adversely affect our business.  Mining
royalties and other tax reform could have an adverse effect on the business,
operating results and financial condition of our operations.  The
Mineral and Petroleum Resources Royalty Act, No.28 of 2008 and the Mineral and
Petroleum Resources Royalty Act (Administration), No.29 of 2008govern royalty rates
for gold mining in South Africa. These acts provide
for the payment of a royalty, calculated through a royalty rate formula (using
rates of between 0.5% and 5.0%) applied against gross revenue per year, payable
half yearly with a third and final payment thereafter. The royalty is tax
deductible and the cost after tax amounts to a rate of between 0.33% and 3.3%
at the prevailing marginal tax rates applicable to the taxed entity. The
royalty is payable on old unconverted mining rights and new converted mining
rights. Based on a legal opinion the Company obtained, mine dumps created
before the enactment of theMineral and Petroleum Resources
Development Act (“MPRDA”) fall outside the ambit of this royalty and
consequently the Company does not pay any royalty on any dumps created prior to
the MPRDA. Introduction of further revenue based royalties or any adverse
future tax reforms could have an adverse effect on our business, operating
results and financial condition.  Failure
to comply with the requirements of the Broad Based Socio-Economic Empowerment
Charter could have an adverse effect on our business, operating results and
financial condition of our operations.  The
Broad Based Socio‐Economic Empowerment Charter for the South African
Mining Industry (“Mining Charter”) (effective from 2014) established
certain numerical goals and timeframes to transform equity participation in the
mining industry in South Africa. The goals set by the Mining Charter include
that each mining company must achieve 15% ownership by historically
disadvantaged South Africans, or HDSA, of its South African mining assets
within five years and 26% ownership within ten years, in each case, from
May 1, 2004. This is to be achieved by, among other methods, the sale
of assets to historically disadvantaged persons on a willing seller/willing
buyer basis at market value.  In
September 2010, the Department of Mineral Resources (“DMR”) released
amendments to the Mining Charter. The intention behind the amendments to the
Mining Charter was to clarify certain ambiguities and uncertainties which
existed under the Mining Charter and to provide more specific targets.It was this latter
Mining Charter which the DMR applied to assess compliance with socio-economic
transformation objectives. The goals set by
the amendments to the Mining Charter include: minimum 26% HDSA ownership by
March 2015; procurement of a minimum 40% of capital goods, 50% of consumer
goods and 70% of services from Black Economic Empowerment, or BEE, entities by
March 2015; minimum 40% HDSA representation at each of executive management
level, senior management level, middle management level, junior management
level and core and critical skills levels; minimum 3% investment of annual
payroll in skills training; investment in community development; and attaining
an occupancy rate of one person per room in on-site accommodation.  A new Mining Charter
has been implemented in September 2018 and supersedes all previous iterations
thereof.For detailed discussion, see Item 4B. Business Overview
– Governmental regulations and their effect on our business –  The Broad Based
Socio-Economic Empowerment Charter.  Government policies in South Africa may adversely impact
our operations and profits related to financial provisioning for
rehabilitation.  An
amendment to the MPRDA was first proposed in 2013. The amendment bill, if
implemented, would have had a material adverse impact on the Group's estimated
financial provisions for environmental remediation and management due to the
proposed inclusion of historic and old mine dumps in the definition of “residue
stockpiles” as well as the extension of the liability for rehabilitation beyond
the issuance of a closure certificate and the requirement to maintain financial
provision for closed sites within a period of 20 years after a site is closed.The MPRDA Amendment
Bill was withdrawn in August 2018 by the Minister of Mineral Resources, citing,
amongst other things, the adequacy of the current MPRDA to deal with all
regulatory matter pertaining to the mining and petroleum industries.  15


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Revised Financial Provisioning
Regulations (“FPR”) were published on November 20, 2015 under the
National Environmental Management Act, 107 of 1998 (“NEMA”) and became
effective from the date of publication thereof. Proposed amendments to the FPRs
were published for public comment GNR 1228 GG 41236 of November 10, 2017
(“Draft Regulations”), which seek to address some challenges relating to the
implementation thereof. Under these FRPs to be implemented by the DMR, existing
environmental rehabilitation trust funds may only be used for post closure
activities and may no longer be utilised for their intended purpose of
concurrent and final rehabilitation and closure. Further amendments were made
to the FPR on September 21, 2018, which extends the period of compliance with
the FPR to February 19, 2020. This is likely to affect the amount of funds set
aside for financial provision for rehabilitation of the mine.See discussion in 4.B.
Business Overview – Governmental regulations and their effect on our business –
Financial Provision for Rehabilitation.  The implementation of Carbon Tax effective from June 1,
2019 may have a direct or indirect material adverse effect on our business,
operating results and financial condition.  The
Carbon Tax Act No 15 of 2019, or the CTA, came into effect from June 1, 2019.
The CTA is based on the polluter-pays-principle and will be implemented across
phases. The first phase will run from June 1, 2019 to December 31, 2022 and is
applicable to scope 1 emitters. The second phase will be implemented from January
1, 2023 to December 31, 2030. During the first phase, tax-free emission
allowances ranging from 60 per cent to 95 per cent are available to emitters in
this first phase. This includes a basic tax-free allowance of 60 per cent for
all activities, a 10 per cent process and fugitive emissions allowance, a
maximum 10 per cent allowance for companies that use carbon offsets to reduce
their tax liability, a performance allowance of up to 5 per cent for companies
that reduce the emissions intensity of their activities, a 5 per cent carbon
budget allowance for complying with the reporting requirements and a maximum 10
per cent allowance for trade exposed sectors. Regulations detailing the tax-free
emission allowances during the first and second phases have not been published
to date. The Carbon Tax will not have a direct impact on the price of
electricity during the first phase. The Carbon Tax may have a direct or
indirect material adverse effect on our business, operating results and
financial condition. In addition, the potential increases in costs resulting
from suppliers passing through their Carbon Tax exposure to the Company may
have a direct or indirect material adverse effect on our business, operating
results and financial condition.  Ring-fencing
of unredeemed capital expenditure for South African mining tax purposes could
have an adverse effect on the business, operating results and financial
condition of our operations.  The
Income Tax Act No 58 of 1962, or the ITA, contains certain ring-fencing
provisions in section 36 specifically relating to different mines regarding the
deduction of certain capital expenditure and the carry over to subsequent
years. After the restructuring of the surface operations, effective July 1,
2012, Ergo is treated as one taxpaying operation pursuant to the relevant
ring-fencing legislation. It is expected that FWGR will also be treated as one
taxpaying operation pursuant to the relevant ring-fencing legislation. In the
event that we are unsuccessful in confirming our position or should the South
African Receiver of Revenue have a different interpretation of section 36 of
the ITA, it could have an adverse effect on our business, operating results and
financial condition.  Assessment of unredeemed capital expenditure by the South
African Receiver of Revenue could have an adverse effect on the business,
operating results and financial condition of our operations.  Capital
expenditure is assessed by the South African Receiver of Revenue when it is
redeemed against taxable mining income rather than when it is incurred. A
different interpretation by the South African Receiver of Revenue could have an
adverse effect on our business, operating results and financial condition.  Since
our South African labor force has substantial trade union participation, we
face the risk of disruption from labor disputes and new South African labor
laws.  Labor
costs are significant for Ergo,
constituting 18% of Ergo’s production costs for fiscal year 2019 (2018: 19%).
As of June 30, 2019, our Ergo operations provided full-time
employment for 852 employees while our main service providers deployed an
additional 1,362 employees to our operations, of whom approximately 92% are
members of trade unions or employee associations.  Labor
costs are significant for FWGR,
constituting 31% of FWGR’s production costs subsequent to the date of
commercial production of April 1, 2019. As of June 30, 2019, our FWGR
operations provided full-time employment for 152 employees while our main
service providers deployed an additional 229 employees to our operations, of
whom approximately 70% are members of trade unions or employee associations. We
have entered into various agreements regulating wages and working conditions at
our mines. Unreasonable wage demands could increase production costs to levels
where our operations are no longer profitable. This could lead to accelerated
mine closures and labor disruptions. We are also susceptible to strikes by
workers from time to time, which result in disruptions to our mining
operations.  In
recent years, labor laws in South Africa have changed in ways that
significantly affect our operations. In particular, laws that provide for
mandatory compensation in the event of termination of employment for
operational reasons and that impose large monetary penalties for non-compliance
with the administrative and reporting requirements of affirmative action
policies could result in significant costs to us. In addition, future South
African legislation and regulations relating to labor may further increase our
costs or alter our relationship with our employees. Labor cost increases could
have an adverse effect on our business, operating results and financial
condition.  Labor
unrest could affect production.  During
December 2018 to April 2019 there was strike action by staff at the Sibanye-Stillwater
gold mines adjacent to FWGR. Such events at our operations orat our reclamation
sitescould have an adverse effect on our business, operating
results and financial condition.  We
use a third party service provider for the management of our reclamation sites
as well as on our Tailings Storage Facilities at 16


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Brakpan/Withok
TSF and Driefonteint 4 TSF. Any labor unrest or other significant issue at this
third party service provider may impact the operation of this facility.  Strike action and intimidation at mining operations
adjacent to our FWGR mining operations could have an
adverse effect on our business, operating results and financial condition.  Our
financial flexibility could be materially constrained by South African currency
restrictions.  South
African law provides for exchange control regulations, which restrict the
export of capital from the Common Monetary Area, including South Africa. The
Exchange Control Department of the South African Reserve Bank, or SARB, is
responsible for the administration of exchange control regulations. In
particular, South African companies: ·are
generally not permitted to export capital from South Africa or to hold foreign
currency without the approval of the SARB; ·are
generally required to repatriate, to South Africa, profits of foreign
operations; and ·are
limited in their ability to utilize profits of one foreign business to finance
operations of a different foreign business.  While
the South African Government has relaxed exchange controls in recent years, it
is difficult to predict whether such relaxation of controls will continue in
the future. For further information see Item 10D. Exchange Controls.  We
could be adversely affected by violations of the U.S. Foreign Corrupt Practices
Act and similar anti-bribery laws outside of the United States.  The
U.S. Foreign Corrupt Practices Act, or the FCPA, and similar anti-bribery laws
in other jurisdictions generally prohibit companies and their intermediaries
from making improper payments to government officials or other persons for the
purpose of obtaining or retaining business. Anti-bribery law enforcement active
with aggressive investigations and enforcement proceedings by both the U.S.
Department of Justice and the SEC, increased enforcement activity by non- U.S.
regulators, and increases in criminal and civil proceedings brought against
companies and individuals. Our policies mandate compliance with the FCPA and
other applicable anti-bribery laws. Our internal control policies and procedures
may not protect us from reckless or criminal acts committed by our employees,
the employees of any of our businesses, or third party intermediaries. In the
event that we believe or have reason to believe that our employees or agents
have or may have violated applicable anti-corruption laws, including the FCPA,
we would investigate or have outside counsel investigate the relevant facts and
circumstances, which can be expensive and require significant time and
attention from senior management. Violations of these laws may result in
criminal or civil sanctions, inability to do business with existing or future
business partners (either as a result of express prohibitions or to avoid the appearance
of impropriety), injunctions against future conduct, profit disgorgements,
disqualifications from directly or indirectly engaging in certain types of
businesses, the loss of business permits, reputational harm or other
restrictions which could disrupt our business and have a material adverse
effect on our business, financial condition, results of operations or
liquidity.  We
face risks with respect to compliance with the FCPA and similar anti-bribery
laws through our acquisition of new companies and the due diligence we perform
in connection with an acquisition may not be sufficient to enable us fully to
assess an acquired company’s historic compliance with applicable regulations. Furthermore,
our post-acquisition integration efforts may not be adequate to ensure our
system of internal controls and procedures are fully adopted and adhered to by
acquired entities, resulting in increased risks of non-compliance with
applicable anti-bribery laws.  Risks related to
ownership of our ordinary shares or ADSs  It
may not be possible for you to effect service of legal process, enforce
judgments of courts outside of South Africa or bring actions based on
securities laws of jurisdictions other than South Africa against us or against
members of our board.  Our
Company, certain members of our board of directors and executive officers are
residents of South Africa. All our assets are located outside the United States
and a major portion with respect to the assets of members of our board of
directors and executive officers are either wholly or substantially located
outside the United States. As a result, it may not be possible for you to
effect service of legal process, within the United States or elsewhere
including in South Africa, upon most of our directors or officers, including
matters arising under United States federal securities laws or applicable
United States state securities laws.  Moreover,
it may not be possible for you to enforce against us or the members of our
board of directors and executive officers’ judgments obtained in courts outside
South Africa, including the United States, based on the civil liability
provisions of the securities laws of those countries, including those of the
United States.A foreign judgment is not
directly enforceable in South Africa, but constitutes a cause of action which
will be enforced by South African courts provided that:  ·the court which pronounced the judgment had jurisdiction
to entertain the case according to the principles recognized by South African
law with reference to the jurisdiction of foreign courts; ·the judgment is final and conclusive (that is, it cannot
be altered by the court which pronounced it); ·the judgment has not lapsed; ·the recognition and enforcement of the judgment by South
African courts would not be contrary to public policy, including observance of
the rules of natural justice which require that no award is enforceable unless
the defendant was duly served with documents initiating proceedings, that he
was given a fair opportunity to be heard and that he enjoyed the right to be
legally represented in a free and fair trial before an impartial tribunal; ·the judgment was not obtained by fraudulent means; 17


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·the judgment does not involve the enforcement of a penal
or revenue law; and ·the enforcement of the judgment is not otherwise
precluded by the provisions of the Protection of Business Act, 1978 (as
amended), of South Africa.  It
is the policy of South African courts to award compensation for the loss or
damage sustained by the person to whom the compensation is awarded. Although
the award of punitive damages is generally unknown to the South African legal
system that does not mean that such awards are necessarily contrary to public
policy. Whether a judgment was contrary to public policy depends on the facts
of each case. Exorbitant, unconscionable, or excessive awards will generally be
contrary to public policy. South African courts cannot enter into the merits of
a foreign judgment and cannot act as a court of appeal or review over the foreign
court. South African courts will usually implement their own procedural laws
and, where an action based on an international contract is brought before a
South African court, the capacity of the parties to the contract will usually
be determined in accordance with South African law.  It
is doubtful whether an original action based on United States federal
securities laws may be brought before South African courts. A plaintiff who is
not resident in South Africa may be required to provide security for costs in
the event of proceedings being initiated in South Africa. Furthermore, the
Rules of the High Court of South Africa require that documents executed outside
South Africa must be authenticated for use in South African courts.It may
not be possible therefore for an investor to seek to impose liability on us in
a South African court arising from a violation of United States federal
securities laws.  Dividend
withholding tax will reduce the amount of dividends received by beneficial
owners.  On April 1, 2012, the South African Government replaced
Secondary Tax on Companies (then 10%) with a 15% withholding tax on dividends
and other distributions payable to shareholders. The dividend withholding tax
rate was increased to 20%, effective from February 22, 2017.  The withholding
tax reduces the amount of dividends or other distributions received by our
shareholders. Any further increases in such tax will further reduce net
dividends received by our shareholders.  Your
rights as a shareholder are governed by South African law, which differs in
material respects from the rights of shareholders under the laws of other
jurisdictions.  Our
Company is a public limited liability company incorporated under the laws of
the Republic of South Africa. The rights of holders of our ordinary shares, and
therefore many of the rights of our ADS holders, are governed by our memorandum
of incorporation and by South African law. These rights differ in material
respects from the rights of shareholders in companies incorporated elsewhere,
such as in the United States. In particular, South African law significantly
limits the circumstances under which shareholders of South African companies
may institute litigation on behalf of a company.  Control
by principal shareholders could adversely affect our other shareholders.  On July 31,
2018, 265 million ordinary shares were issued to Sibanye-Stillwater as settlement
of the purchase consideration for the acquisition of the WRTRP Assets. As part
of this acquisition, Sibanye-Stillwater was granted an option to subscribe for
further shares to achieve a 50.1% shareholding at a 10% discount to the
prevailing market value for a period of 2 years from the effective date of the
acquisition. As a result, Sibanye-Stillwater currently beneficially owns
approximately 38.05% of our outstanding ordinary shares and voting power and
this may increase to 50.1%. Sibanye-Stillwater therefore has the ability to
control, or exert a significant influence over, our board of directors, and
will continue to have significant influence over our affairs for the
foreseeable future, including with respect to the election of directors, the consummation
of significant corporate transactions, such as an amendment of our
constitution, a  merger or other sale of our company or our assets, and all
matters requiring shareholder approval. In certain circumstances,
Sibanye-Stillwater’s interests as a principal shareholder may conflict with the
interests of our other shareholders and Sibanye-Stillwater’s ability to
exercise control, or exert significant influence, over us may have the effect
of causing, delaying, or preventing changes or transactions that our other
shareholders may or may not deem to be in their best interests. In addition,
any sale or expectation of sale of some or all the shares held by
Sibanye-Stillwater could have an adverse impact on our stock price.  Sales of
large volumes of our ordinary shares or ADSs or the perception that these sales
may occur, could adversely affect the prevailing market price of such
securities.  The
market price of our ordinary shares or ADSs could fall if substantial amounts
of ordinary shares or ADSs are sold by our stockholders, or there is the
perception in the marketplace that such sales could occur. Current holders of
our ordinary shares or ADSs may decide to sell them at any time. Sales of our
ordinary shares or ADSs, if substantial, or the perception that any such
substantial sales may occur, could exert downward pressure on the prevailing
market prices for our ordinary shares or ADSs, causing their market prices to
decline. Trading activity of hedge funds and the ability to borrow script in
the market place will increase trading volumes and may place our share price
under pressure. 18


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ITEM 4. INFORMATION ON THE
COMPANY  4A. HISTORY AND DEVELOPMENT OF THE COMPANY  Introduction  DRDGOLD
Limited, or DRDGOLD, is a South African domiciled company that holds assets
engaged in surface gold tailings retreatment in South Africa including
exploration, extraction, processing and smelting.  We
are a public limited liability company, incorporated on February 16, 1895,
as Durban Roodepoort Deep, Limited. On December 3, 2004, the company changed
its name from Durban Roodepoort Deep Limited to DRDGOLD Limited. Our operations
focus on South Africa's West Witwatersrand Basin, which has been a gold
producing region for over 120 years.  Our
shares and/or related instruments trade on the JSE, and the New York Stock
Exchange.  Our
registered office and business address is 1 Sixty Jan Smuts Building, 2nd Floor
- North Tower, 160 Jan Smuts Avenue, Rosebank, 2196, South Africa. The postal
address is P.O. Box 390, Maraisburg, 1700, South Africa. Our telephone
number is (+27 11) 470-2600 and our facsimile number is (+2786)
524-3061. We are registered under the South African Companies Act
71, 2008 under registration number 1895/000926/06. For our ADSs, the Bank of
New York Mellon, at 101 Barclay Street, New York, NY 10286, United States, has
been appointed as agent.  All
of our operations are conducted in South Africa.  Our operations primarily consist of Ergo and FWGR. Our Ergo
operations include the historic Crown operations (which were restructured into
Ergo during fiscal year 2012 and have substantially been rehabilitated as at
the end of fiscal year 2018) and theEast Rand Proprietary Mines
Limited's (“ERPM”)underground mining
infrastructure which is currently under care and maintenance.  On July 31, 2018, we acquired certain gold surface
processing assets and tailing storage facilities that included Driefontein 3
and 5, Kloof 1, Venterspost North and South, Libanon, Driefontein 4,
Driefontein 2 plant, Driefontein 3 plant, WRTRP pilot plant, and land required
for the future development of a central processing plant, regional tailings
storage facility and return water dam (together, the “WRTRP Assets”) associated
with Sibanye-Stillwater’s WRTRP, to be known going forward as FWGR.  This
acquisition represented a significant increase in our assets, which impacted our results in fiscal 2019 and will impact
our results in future years.  In connection with the acquisition, we issued to
Sibanye-Stillwater new shares equal to 38.05% of outstanding shares and granted
Sibanye-Stillwater an option to acquire up to a total of 50.1% of our shareswithin a period of 2 years from the effective date of the
acquisition at a 10% discount to the prevailing market value. For more information regarding this acquisition please see our
Form 6-K, dated November 22, 2017 "Proposed Transaction to acquire the
WRTRP assets from Sibanye-Stillwater, waiver of mandatory offer and cautionary announcement",
incorporated by reference herein and Item 10C. Material Contracts.  For a detailed description of the assets acquiredsee Item 4D. Property, Plant and Equipment.  Ergo  Ergo
was formed in June 2007.Ergo is the surface tailings retreatment
operation consisting of what was historically the Crown Gold Recoveries
Proprietary Limited (“Crown”), ERPM Cason Dump operation and the
ErgoGold business units which are now collectively referred to as Ergo.On July 1, 2012, Ergo acquired the mining assets
and certain liabilities of Crown and all the surface assets and liabilities of
ERPM as part of the restructuring of our surface operations. Also as part of
this restructuring, Ergo acquired DRDGOLD's 35% interest in ErgoGold.  The
flotation and fine-grind (“FFG”) project, commissioned during fiscal
year 2014, is designed to improve extraction efficiencies which are derived
from the separation of gold contained within the sulfides of the tailings
material by subjecting the treated material to a flotation circuit, further
regrinding and a leach circuit.The operation of the FFG circuit was temporarily halted in the
first quarter of fiscal 2020 to perform an evaluation and compare the additional
revenues earned from extracting additional gold from the most recently
integrated reclamation sites compared to the cost incurred to operate the FFG
circuit. The evaluation also includes considering alternative configurations of
the FFG circuit and alternative means of extracting gold using the FFG circuit.
At the date of this report, the evaluation is ongoing.  Capital
expenditure for the Ergo projects is
mainly financed through cash resources and operational cash flows while
financing for significant growth projects may be obtained through specific
financing arrangements if required.  Brakpan/Withok TSF
expansion In order to extend the
life of our Ergo operation, it is necessary to increase residue tailings
deposition capacity at our Brakpan/Withok TSF. A legal review of the existing
authorizations was undertaken for increasing the deposition capacity of the
Brakpan/Withok TSF. The results indicated that most of the current
authorizations are sufficient, however certain documentation would need to be
amended. We expect this
could increase the
potential deposition capacity by approximately 800Mt, and thus, our life of
mine from 11 years to more than 20 years.For 19


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further information on
other capital investments, divestures, capital expenditure and capital
commitments, see Item 4D. Property, Plant and Equipment, and Item 5B. Liquidity
and Capital Resources.  ERPM  ERPM,
which consists of an underground mine which has been under care and maintenance
since fiscal year 2009, and ERPM Extension 1 and 2 exploration tenements, were
acquired in October, 2002. Underground mining at ERPM was halted in
October 2008. On July 1, 2012, ERPM sold its surface mining assets and its 65%
interest in ErgoGold to Ergo in exchange for shares in Ergo as part of the
restructuring of our surface operations.  In
December 2018, ERPM concluded revised agreements to dispose certain of its underground
assets to OroTree Limited (“Orotree”). The revised agreements consisted
of a disposal of ERPM's underground mining and prospecting rights and an option
agreement, at the sole discretion of Orotree, to purchase the underground
mining infrastructure exercisable on or before 30 June 2019. The disposal of
the underground mining and prospecting rights were concluded in the second half
of the financial year ended 30 June 2019. Orotree’s option to purchase the
underground mining infrastructure lapsed on June 30, 2019 when it did not
exercise the option to such underground mining infrastructure.  Crown  Crown
was acquired on September 14, 1998. Due to the depletion of
ore reserves in the western Witwatersrand, the Crown plant ceased operation in
March 2017.   4B. BUSINESS OVERVIEW  We are a South African companythat
holds assets engaged in surface gold tailings retreatment including
exploration, extraction, processing and smelting. Our
surface tailings retreatment operations, including the requisite infrastructure
and metallurgical processing plants, are located in South Africa. Our operating
footprint is unique in that it involves some of the largest concentration of
gold tailings deposits in the world, situated within the city boundaries of
Johannesburg and its suburbs.  The success of DRDGOLD’s long-term goal to extract as much gold as
possible and economically viable from its assets depends,
to a large extent, on how effectively it continues to manage its capitals.
DRDGOLD uses sustainable development to direct its strategic thinking. We seek
sustainable benefits in respect to financial, manufactured, natural, social and
human capitals, each of which is essential to our operations.  We
also aim to align and overlap the interests of each of these capitals in such a
manner that an investment in any one translates into value-added increases in
as many of the others as possible. We therefore seek to achieve an enduring and
harmonious alignment between them, and we pursue these criteria in the
feasibility analysis of each investment. The board intends to explore
opportunities made possible by technology, which could entail further
investment in research and development (“R&D”) to improve gold recoveries
even further over the long term.  On July 31, 2018, we acquired the gold assets
associated with Sibanye-Stillwater’s WRTRP, to be known going forward as FWGR. 
This acquisition represented a significant increase in our assets.  During the fiscal years presented in this Annual Report, all of
our operations took place in one geographic region, namely South Africa.  Description
of Our Mining Business  Surface tailings
retreatment  Surface
tailings retreatment involves the extraction of gold from old mine dumps and
slimes dams,comprising the waste material from earlier underground
gold mining activities. This is done by reprocessing sand dumps and slimes dams.
Sand dumps are the result of the less efficient stamp-milling process employed
in earlier times. They consist of coarse-grained particles which generally
contain higher quantities of gold. Sand dumps are reclaimed mechanically using
front end loaders that load sand onto conveyor belts. The sand is fed onto a
screen where water is added to wash the sand into a sump, from where it is
pumped to the plant. Most sand dumps have already been retreated using more
efficient milling methods. Lower grade slimes dams were the product of the
“tube and ball mill” recovery process. This material has become economically
more viable to process owing to improved treatment methods. The material from
the slimes dams is broken down using monitor guns that spray jets of high
pressure water at the target area. The resulting slurry is then pumped to a
treatment plant for processing.  Exploration  Exploration activities are focused on the
extension of existing ore reserves and identification of new ore reserves both
at existing sites and at undeveloped sites. Once a potential site has been
identified, exploration is extended and intensified in order to enable clearer
definition of the site and the portions with the potential to be mined.
Geological techniques are constantly refined to improve the economic viability
of exploration and exploitation.  Our
Metallurgical Plants and Processes  20


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A detailed review of the metallurgical
plants and processes is provided under Item 4D. Property, Plant and Equipment.  Gold
Market  The
gold market is relatively liquid compared to other commodity markets, and the
price of gold is quoted in dollars. Physical demand for gold is primarily for
manufacturing purposes, and gold is traded on a world-wide basis. Refined gold
has a variety of uses, including jewelry, electronics, dentistry, decorations,
medals and official coins. In addition, central banks, financial institutions
and private individuals buy, sell and hold gold bullion as an investment and as
a store of value.  The use of gold as a store of value and the large
quantities of gold held for this purpose in relation to annual mine production
have meant that historically the potential total supply of gold has been far
greater than demand. Thus, while current supply and demand play some part in
determining the price of gold, this does not occur to the same extent as in the
case of other commodities. Instead, the gold price has from time to time been
significantly affected by macro-economic factors such as expectations of
inflation, interest rates, exchange rates, changes in reserve policy by central
banks and global or regional political and economic crises. In times of
inflation and currency devaluation gold is often seen as a safe haven, leading
to increased purchases of gold and support for its price.  The average gold spot price decreased by 3% from $1,297
per ounce to $1,263 per ounceduring fiscal year 2019after
having increased by 3% from $1,257per ounce to$1,297per
ounce during the fiscal year2018 and having
increased by 8% from $1,167per ounce to$1,257per
ounce during the fiscal year2017. The
average gold price received by us for fiscal year 2019 increased by 8% to R577,483
per kilogram compared to the previous year at R534,368 per kilogram.  Looking ahead we believe that the global economic
environment, including escalating sovereign and personal levels of debt,
economic volatility and the oversupply of foreign currency, will again make
gold attractive to investors. The supply of gold
has shrunk in recent years and is likely
to shrink even more due to the significantly reduced capital expenditure and
development occurring in the sector.  We believe that this, coupled with global
economic uncertainty, is likely to provide support to the gold price in the
long term.  All of
our revenue is generated in South Africa. Our total revenue for fiscal year
ended June 30, 2019 amounted to R2,762.1 million (2018: R2,490.4 million and 2017:
R2,339.9 million).  All
gold we produce is sold on our behalf by Rand Refinery Proprietary Limited
(Rand Refinery) in accordance with a refining agreement entered into in
October 2001 and updated in July 2018. The gold bars which we produce
consist of approximately 85% gold, 7-8% silver and the balance comprises copper
and other common elements. The gold bars are sent to Rand Refinery for assaying
and final refining where the gold is purified to 99.9% and cast into troy ounce
bars of varying weights. The Group recognizes revenue from the sale of gold at
a point in time when Rand Refinery, acting as an agent for the sale of all gold
produced by the Group, delivers the Gold to the buyer. The sales price is fixed
at the London afternoon fixed dollar price on the day the Gold is delivered to
the buyer. The dollar proceeds are remitted to us within two days. In exchange
for this service we pay Rand Refinery a variable refining fee plus fixed
marketing and administration fees. We own 11% (fiscal year2018and2017:
11%) of Rand Refinery.  Ore
Reserves  Ore
Reserve estimates in this Annual Report are reported in accordance with the
requirements of the SEC’s Industry Guide 7. Accordingly, as of the date of
reporting, all ore reserves are planned to be mined under the life of mine plan
within the period of our existing rights to mine, or within the time period of
assured renewal periods of our rights to mine. In addition, as of the date of
this report, all ore reserves are covered by required permits and governmental
approvals. See Item 4D. Property, Plant and Equipment for a description of the
rights in relation to each mine.  In South
Africa, we are legally required to publicly report Ore Reserves and Mineral
Resources in compliance with the South African Code for the Reporting of
Exploration Results, Mineral Resources and Mineral Reserves, or SAMREC Code.
The SEC’s Industry Guide 7 does not recognize Mineral Resources. Accordingly,
we do not include estimates of Mineral Resources in this Annual Report.  Ore
Reserve calculations are subject to a review conducted in accordance with SEC
Industry Guide 7.Ore Reserve tons, grade
and content are quoted as delivered to the gold plant. There are two types of
methods available to select ore for mining. The first is pay-limit, which
includes cash operating costs, including overhead costs, to calculate the
pay-limit grade. The second is the cut-off grade which includes cash operating
costs, excluding fixed overhead costs, to calculate the cut-off grade,
resulting in a lower figure than the full pay-limit grade. The cut-off grade is
based upon direct costs from the mining plan, taking into consideration
production levels, production efficiencies and the expected costs. We use the
pay-limit to determine which areas to mine as an overhead inclusive amount that
is indicative of the break-even position.  The
pay-limit approach is based on the minimum in-situ grade of reclamation sites,
for which the production costs, which includes all overhead costs, including
head office charges, are equal to a three-year historical average gold price
per ounce for that year. This calculation also considers the previous three
years’ mining and milling efficiencies, which includes metallurgical and other
mining factors and the production plan for the next twelve months. Only areas
above the pay-limit grade are considered for mining. The pay-limit grade is
higher than the cut-off grade, because this includes overhead costs, which
indicates the break-even position of the operation.  When
delineating the economic limits to the ore bodies, we adhere to the following
guidelines: ·The potential ore to be mined is well defined by an
externally verified and approved geological model; ·The potential ore, which is legally allowed to be mined,
is also confined by the mine's lease boundaries; and 21


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·A business plan is prepared to mine the potential ore.  Our
Ore Reserves figures are estimates, which may not reflect actual ore reserves
or future production. These figures are prepared in accordance with industry
practice, converting mineral deposits to an Ore Reserve through the preparation
of a mining plan. The Ore Reserve estimates contained herein inherently include
a degree of uncertainty and depend to some extent on statistical inferences.
Ore reserve estimates require revisions based on actual production experience
or new information. Should we encounter mineralization or formations different
from those predicted by past drilling, sampling and similar examinations, ore
reserve estimates may have to be adjusted and mining plans may have to be
altered in a way that might adversely affect our operations and actual gold recoveries may differ from those
indicated in our Ore Reserves. Moreover, if the
price of gold declines, or stabilizes at a price that is lower than recent
levels, or if our production costs increase or recovery rates decrease, it may
become uneconomical to recover Ore Reserves containing relatively lower grades
of mineralization.  Our
Ore Reserves are prepared using three year average rand gold prices. We prepare
business plans using the forecast rand gold price at the time of the ore
reserve determination.  Gold
prices and exchange rates used for Ore Reserves and for our business plan are
outlined in the following table.  June, 30
 June, 30
 June, 302019
 2018
 2017Three-year average
 Prevailing gold price
 Three-year average gold price
 Prevailing gold price
 Three-year average gold price
 Prevailing gold priceReserve
  gold price –$/oz
 1,272
 1,369
 1,240
 1,328
 1,216
 1,280Reserve
  gold price –R/kg
 552,585
 629,404
 543,327
 550,411
 514,785
 565,000Exchange
  rate –R/$
 13.53
 14.30
 13.63
 12.90
 13.17
 13.73
 Our Ore Reserves
(imperial) changed in the past three fiscal years as follows:  ·Our
Ore Reserves (imperial) increased from 3.28million ounces at June
30, 2018, to 5.77million ounces at June 30, 2019,mainly because of the acquisition of the
gold assets associated with theSibanye-Stillwater
WRTRP project, subsequently renamed FWGR, that added Ore Reserves of 2.72Moz.
The increase was offset by depletion through ongoing mining activities.  ·Our
Ore Reserves (imperial) increased from 2.99million ounces at June
30, 2017, to 3.28million ounces at June 30, 2018,
representing a 9.7% increase. The increase was mainly because of a drilling
program and PFS that commenced during September 2016 aimed at re-evaluating our
surface gold tailings. The drilling program continued in fiscal year 2019. The
increase was offset by depletion through ongoing mining activities and other
survey adjustments.  ·Our
Ore Reserves (imperial) increased from 1.8million ounces at June
30, 2016, to 2.99 million ounces at June 30, 2017. The increase was mainly
because of a drilling program and PFS that commenced during September 2016. The
increase was offset by depletion through ongoing mining activities and other
survey adjustments.  The life
of mine for Ergo based on proven and probable ore reserves under Industry Guide
7 of the SEC as atJune 30, 2019, was 11 years and the life of mine as atJune 30, 2018, 12
years.  The life of mine for FWGR based on proven and probably
ore reserves under Industry Guide 7 of the SEC as atJune 30, 2019was 20 years. 22


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DRDGOLD's Ore Reserves as of June 30,
  2019 and 2018 are set forth in the tables below.Ore Reserves: ImperialAt June 30, 2019
 At June 30, 2018Proven Ore Reserves
 Probable Ore Reserves
 Proven Ore Reserves
 Probable Ore ReservesTons
 Grade
 Gold Content
 Tons
 Grade
 Gold Content
 Tons
 Grade
 Gold Content
 Tons
 Grade
 Gold Content(mill)
 (oz/ton)
 ('000 ozs)
 (mill)
 (oz/ton)
 ('000 ozs)
 (mill)
 (oz/ton)
 ('000 ozs)
 (mill)
 (oz/ton)
 ('000 ozs)SurfaceErgo1
 61,672
 0.01
 540
 283,675
 0.01
 2,540
 74.988
 0.01
 663
 291,198
 0.01
 2,617FWGR1
 194,883
 0.01
 2,070
 74,106
 0.01
 620
 -
 -
 -
 -
 -
 -Total1
 256,555
 0.01
 2,610
 357,781
 0.01
 3,160
 74.988
 0.01
 663
 291,198
 0.01
 2,617Ore reserves: MetricAt June 30, 2019
 At June 30, 2018Proven Ore Reserves
 Probable Ore Reserves
 Proven Ore Reserves
 Probable Ore ReservesTonnes
 Grade
 Gold Content
 Tonnes
 Grade
 Gold Content
 Tonnes
 Grade
 Gold Content
 Tonnes
 Grade
 Gold Content(mill)
 (g/tonne)
 (tonnes)
 (mill)
 (g/tonne)
 (tonnes)
 (mill)
 (g/tonne)
 (tonnes)
 (mill)
 (g/tonne)
 (tonnes)SurfaceErgo1
 55.95
 0.310
 17.360
 257.35
 0.317
 81.660
 68.03
 0.303
 20.590
 264.17
 0.308
 81.300FWGR1
 176.80
 0.365
 64.580
 67.23
 0.285
 19.130
 -
 -
 -
 -
 -
 -Total1
 232.75
 0.352
 81.940
 324.58
 0.311
 100.790
 68.03
 0.303
 20.590
 264.17
 0.308
 81.3001The Ore Reserves listed in the above table are estimates of
  what can be legally and economically recovered from operations, and, as
  stated, are estimates of tons delivered to the plant.
  23


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The measurement and classification of our Proven and
Probable Ore Reserves are sensitive to an extent to the fluctuation of the rand
gold price. If we had used different rand gold prices than the three-year
average prices at the time of ore reserve determination, as of June 30, 2019
and 2018 respectively, we would not have had significantly different ore
reserves as of those dates. Using the same methodology and assumptions as were
used to estimate Ore Reserves but with different rand gold prices as detailed
below, our Ore Reserves as of June 30, 2019 and 2018 would be as follows:  Year
  ended June 30, 2019
 Three-year average gold price
 Prevailing price
 10% Below prevailing price
 10% Above prevailing priceRand
  gold price per kilogram
 552,585
 629,404
 566,464
 692,344Dollar
  gold price per ounce
 1,272
 1,369
 1,232
 1,506Ore
  Reserves (million ounces)
 5.77
 5.77
 5.77
 5.77Year
  ended June 30, 2018
 Three-year average gold price
 Prevailing price
 10% Below prevailing price
 10% Above prevailing priceRand
  gold price per kilogram
 543,527
 550,411
 495,370
 605,452Dollar
  gold price per ounce
 1,240
 1,328
 1,195
 1,461Ore
  Reserves (million ounces)
 3.28
 3.28
 3.28
 3.28
 The approximate mining recovery factors for the 2019 ore
  reserves shown in the above table are as follows:MetallurgicalMine Call Factor
 recovery factory(%)
 (%)Ergo
 
 
 100
 47FWGR
 
 
 100
 52The approximate mining recovery factors for the 2018 ore
  reserves shown in the above table are as follows:MetallurgicalMine Call Factor
 recovery factory(%)
 (%)Ergo
 
 
 100
 48
 The following table shows the average drill/sample spacing
  (rounded to the nearest foot), as at June 30, 2019 and 2018, foreach category of Ore Reserves at our mines calculated based on a
  three year average dollar price of gold.Proven
 ProbableReserves
 ReservesErgo and FWGR
 328 ft. by 328 ft.
 328 ft. by 328 ft.
  The pay-limit grades based on the three year average dollar
  price for gold amounting to R552585 /kg and costs used to determinereserves as of June 30, 2019, are as follows:Costs used to determine pay-Pay-limit grade (g/t)
 limit grade (R/t)Ergo
 
 0.200
 60.22FWGR
 
 0.220
 61.12The pay-limit grades based on the three year average dollar
  price for gold amounting to R543,527 and costs used to determinereserves as of June 30, 2018, are as follows:Costs used to determine pay-Ergo
 
 Pay-limit grade (g/t)
 limit grade (R/t)0.224
 58.41We apply the pay-limit approach to the mineralized material
  database of our business in order to determine the tonnage andgrade available for mining.
 24


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Governmental
regulations and their effects on our business  Common Law Mineral Rights and Statutory Mining Rights  Prior to the introduction of the Minerals
and Petroleum Resources Development Act, or MPRDA in 2002, ownership in mineral
rights in South Africa could be acquired through the common law or by statute.
With effect from May 1, 2004, all minerals have been placed under the
custodianship of the South African government under the provisions of the MPRDA
and old order proprietary rights were required to be converted to new order
rights of use within certain prescribed periods, as dealt with in more detail
below. Mine dumps create before the MPRDA became law fall
outside the MPRDA and do not require a mining license to be processed nor does
it require the extensive rehabilitation and closure guarantees that are a
feature of the MPRDA. Many of the activities to re-process a mine dump do fall
under the provisions of the National Environmental Management Act though, which
requires at it most basic the compilation and submission of an Environmental
Impact Assessment.  Conversion
of Rights under the Mineral and Petroleum Resources Development Act, 2002  Existing
old order rights were required to be converted into new order rights in order
to ensure exclusive access to the mineral for which rights existed at the time
of the enactment of the MPRDA. In respect of used old order mining rights, the
DMR is obliged to convert the rights if the applicant complies with certain
statutory criteria. These include the submission of a mining works program,
demonstrable technical and financial capability to give effect to the program,
provision for environmental management and rehabilitation, and compliance with
certain black economic empowerment criteria and a social and labor plan. These
applications had to be submitted within five years after the promulgation of
the MPRDA on May 1, 2004. Similar procedures apply where we hold
prospecting rights and a prospecting permit and conduct prospecting operations.
Under the MPRDA mining rights are not perpetual, but endure for a fixed period,
namely a maximum period of thirty years, after which they may be renewed for a
further period of thirty years. Prospecting rights are limited to five years,
with one further period of renewal of three years. Applications for conversion
of our old order rights were submitted to the DMR within the requisite time
periods. As at June 30, 2019 and September 30, 2019 respectively, all of our Ergo
operation’s old order mining rights have been converted into new order rights
under the terms of the MPRDA.  The
Broad Based Socio-Economic Empowerment Charter  In
order to promote broad based participation in mining revenue, the MPRDA
provides for a Mining Charter to be developed by the Minister within six months
of commencement of the MPRDA beginning May 1, 2004. The Mining Charter was
initially published in August 2004 and was subsequently amended in September
2010. Its objectives include:  ·increased direct and indirect ownership of mining
entities by qualifying parties as defined in the Mining Charter; ·expansion of opportunities for persons disadvantaged by
unfair discrimination under the previous political dispensation; ·expansion of the skills base of such persons, the
promotion of employment and advancement of the social and economic welfare of
mining communities; and ·promotion of beneficiation.  The Mining Charter sets certain goals on equity
participation (amount of equity participation and time frames) by historically
disadvantaged South Africans of South African mining assets. It recommends that
these are achieved by, among other methods, disposal of assets by mining
companies to historically disadvantaged persons on a willing seller, willing
buyer basis at fair market value. The goals set by the Mining Charter require
each mining company to achieve 15 percent ownership by historically
disadvantaged South Africans of its South African mining assets within five
years and 26 percent ownership by May 1, 2014. It also sets out guidelines
and goals in respect of employment equity at management level with a view to
achieving 40 percent participation by historically disadvantaged persons
in management and ten percent participation by women in the mining industry,
each within five years from May 1, 2004. Compliance with these objectives is
measured on the weighted average “scorecard” approach in accordance with a
scorecard which was first published around August 2010.  The
Mining Charter and the related scorecard are not legally binding and, instead,
simply state a public policy. However, the DMR places significant emphasis on
the compliance therewith. The Mining Charter and scorecard, have a decisive
effect on administrative action taken under the MPRDA.  Inrecognition of the Mining
Charter’s objectives of transforming the mining industry by increasing the
number of black people in the industry to reflect the country’s population
demographics, to empower and enable them to meaningfully participate in and
sustain the growth of the economy, thereby advancing equal opportunity and
equitable income distribution, wehave achieved our
commitment to ownership compliance with the MPRDA through our existing black
economic empowerment structure with Khumo Gold and the DRDSA Empowerment Trust.
Our black economic empowerment partners, Khumo Gold and the DRDSA Empowerment
Trust, hold 4% and 2%, respectively, in DRDGOLD Limited. (See Item 4C.
Organizational Structure).  The
mining industry in South Africa is extensively regulated through legislation
and regulations issued by government’s administrative bodies. These involve
directives with respect to health and safety, mining and exploration of
minerals, and managing the impact of mining operations on the environment. A
change in regulatory or government policies could adversely affect our
business.  On
September 27, 2018 the Broad-Based Socio-Economic Empowerment Charter for the
Mining and Minerals Industry, 2018 (“Mining Charter 2018”) was published in
Government Gazette No. 41934 of Government Notice No. 639 on September 27, 2018
superseding and replacing all previous charters, including the Reviewed
Broad-Based Black Economic Empowerment Charter for the South African Mining and
Minerals Industry, 2016 (“Mining Charter III”).  25


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Mining Charter 2018 requires an enduring
30% BEE interest in respect of new mining rights. It also has extensive
provisions in respect of HDP representation at board and management, as well
provisions relating to local procurement of goods and services. The procurement
target of the total spend on services from South African companies has been
pegged at 80% (up from 70% in Mining Charter III) and 60% of the aggregate
spend thereof must be apportioned to BEE entrepreneurs.  Key
provisions of Mining Charter 2018, which are welcomed by the industry are: •               The conditional acceptance of the
continued consequences of previous compliance of the BEE ownership threshold of
26% in respect of existing mining rights; •               Of the 30% HDP ownership component,
qualifying employees and communities are each to hold a 5% carried interest (as
opposed to a free carry interest as per Mining Charter III)  the cost of which
may be recovered by the mining right holder from the development of the asset.
The community interest in turn may be offset by way of an equity equivalent; •               Removal
of the so-called 1% of EBITDA trickle dividend provided for in Mining Charter
III; and •               The
removal of provisions requiring community and employee representation at board
level.  Elements
of Mining Charter 2018 which we consider unfortunate, and which will be the
topic of ongoing discussion with the DMR,  are: •               that
the continuing consequences of HDP ownership are not recognized for transfers
of mining rights; and •               that
a top up of HDP ownership back to 30% is required for the renewal of existing
rights.  DRDGOLD
is a member for the Minerals Council. DRDGOLD has noted a material improvement
on Mining Charter 2018, but still expresses concern on its ability to promote
growth and attract investment.  The
Minerals Council provided, on behalf of its members, its preliminary response
on October 3, 2018 and welcomed the publication of the Mining Charter and indirectly
that it broadly supports its purpose and content. The Minerals Council noted
that the Mining Charter is the product of substantial engagement between key
stakeholders and is a compromise that reflects different difficult choices that
have been made. This Mining Charter provides a better balance between the
mutually reinforcing concepts of promoting competitiveness and transformation.  Mine
Health and Safety Regulation  The
South African Mine Health and Safety Act, 1996 (as amended), or the Mine Health
and Safety Act, came into effect in January 1997. The principal object of
the Mine Health and Safety Act is to improve health and safety at South African
mines and, to this end, imposes various duties on us at our mines and grants
the authorities broad powers to, among other things, close unsafe mines and order
corrective action relating to healthand safety matters. In the event of
any future accidents at any of our mines, regulatory authorities could take
steps which could increase our costs and/or reduce our production capacity. TheAct was amended in2009 and
the amendments to the Act dealt withinter aliathe stoppage of
production and increase punitive measures including increased financial fines
and legal liability of mine management. Some of the more important new
provisions in the 2009 amendment bill are the insertion of section 50(7A) that
obliges an inspector to impose a prohibition on the further functioning of a
site where a person’s death, serious injury or illness to a person or a health
threatening occurrence has occurred; a new section 86A(1) creating a new
offence for any person who contravenes or fails to comply with the provisions
of the Mine Health and Safety Act thereby causing a person’s death or serious
injury or illness to a person. Subsection (3) further provides that (a) the
“fact that the person issued instructions prohibiting the performance or an
omission is not in itself sufficient proof that all reasonable steps were taken
to prevent the performance or omission”; and that (b) “the defense of ignorance
or mistake by any person accused cannot be permitted”; or that (c) “the defense
that the death of a person, injury, illness or endangerment was caused by the
performance or an omission of any individual within the employ of the employer
may not be admitted”; section 86A(2) creating an offence of vicarious liability
for the employer where a Chief Executive Officer, manager, agent or employee of
the employer committed an offence and the employer either connived at or
permitted the performance or an omission by the Chief Executive Officer, manager,
agent or employee concerned; or did not take all reasonable steps to prevent
the performance or an omission. The maximum fines were also increased. Any
owner convicted in terms of section 86 or 86A may be sentenced to “withdrawal
or suspension of the permit” or to a fine of R3 million or a period of
imprisonment not exceeding five years or to both such fine and imprisonment,
while the maximum fine for other offences and for administrative fines have all
been increased, with the highest being R1 million.  Under
the South African Compensation for Occupational Injuries and Diseases Act, 1993
(as amended), or COID Act, employers are required to contribute to a fund
specifically created for the purpose of compensating employees or their
dependents for disability or death arising in the course of their work.
Employees who are incapacitated in the course of their work have no claim for
compensation directly from the employer and must claim compensation from the
COID Act fund. Employees are entitled to compensation without having to prove
that the injury or disease was caused by negligence on the part of the
employer, although if negligence is involved, increased compensation may be
payable by this fund. The COID Act relieves employers of the prospect of costly
damages, but does not relieve employers from liability for negligent acts
caused to third parties outside the scope of employment. In fiscal year 2019,
we contributed approximately R4.3 million under the COID Act (2018: R3.7
million and 2017: R3.6 million) to a multi-employer industry fund administered
by Rand Mutual Assurance Limited.  Under
the Occupational Diseases in Mines and Works Act, 1973 (as amended), or the
Occupational Diseases Act, the multi-employer fund pays compensation to
employees of mines performing “risk work,” usually in circumstances where the
employee is exposed to dust, gases, vapors, chemical substances or other
working conditions which are potentially harmful, or if the employee contracts
a “compensatable disease,” which includes pneumoconiosis, tuberculosis, or a
permanent obstruction of the airways. No employee is entitled to benefits under
the Occupational Diseases Act for any disease for which compensation has been
received or is still to be received under the COID Act. These payment
requirements are based on a combination of the employee costs and claims made
during the fiscal year.  Uranium
and radon are often encountered during the ordinary course of gold mining
operations in South Africa, and present potential risks for radiation exposure
of workers at those operations and the public to radiation in the nearby
vicinity. We monitor our uranium and radon 26


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emissions for
compliance with all local laws and regulations pertaining to uranium and radon
management and under the current legislative exposure limits prescribed for
workers and the public, under the Nuclear Energy Act, 1999 (as amended) and
Regulations from the National Nuclear Regulator.  Environmental
Regulation  Managing the impact of mining on the environment is
extensively regulated by statute in South Africa. Recent statutory enactments
set compliance standards both generally, in the case of the National
Environmental Management Act, and in respect of specific areas of environment
impact, as in the case of the Air Quality Act 2004, the National Water Act
(managing effluent), and the Nuclear Regulator Act 1999. Liability for
environmental damage is also extended to impose personal liability on managers
and directors of mining corporations that are found to have violated applicable
laws. The impact on the environment by mining operations is
extensively regulated by the MPRDA. The MPRDA has onerous provisions for
personal liability of directors of companies whose mining operations have an
unacceptable impact on the environment. Mining companies are also required to demonstrate both
the technical and financial ability to sustain an ongoing environmental
management program, or EMP, and achieve ultimate rehabilitation, the
particulars of which are to be incorporated in an EMP. This program is required
to be submitted and approved by the DMR as a prerequisite for the issue of a
new order mining right. Various funding mechanisms are in place, including
trust funds, guarantees and concurrent rehabilitation budgets, to fund the
rehabilitation liability. The MPRDA imposes specific, ongoing environmental
monitoring and financial reporting obligations on the holders of mining rights.  We
believe that our environmental risks have been addressed in EMPs which have
been submitted to the DMR for approval. Additionally, key environmental issues
have been prioritized and are being addressed through active management input
and support as well as progress measured in terms of activity schedules and
timescales determined for each activity.  Our
existing reporting and controls framework is consistent with the additional
reporting and assessment requirements of the MPRDA.  Amendment
Bill to the MPRDA  On
March 6, 2014 the South African Parliament approved an Amendment Bill to the
MPRDA. The Bill will come into effect once signed by the President of the
Republic of South Africa. Some of the more important changes introduced by the
Bill is to allow the holder of a Mining Right to also mine “associated
minerals” not specifically included in the Mining Right; it addresses
anti-competitive conduct by requiring the Minister of Minerals to refuse an
application for exploration rights if it will cause a “concentration of rights”
as defined in the Bill; historic and old mine dumps are to be included in the
definition of “residue stockpiles” and certain rehabilitation obligations are
created in respect of the discarded mines to which they pertain; and liability for
rehabilitation will extend beyond the issuance of a closure certificate and
financial provision for closed sites will be required to be maintained for a
period of 20 years after a site is closed.  The Bill was finally
withdrawn by the Minister of Mineral Resources on 22 August 2018, citing,
amongst other things, that there were no inherent inhibitions from the
subsistence of the MPRDA in current form.  Financial
Provision for Rehabilitation  We
are required to make financial provision for the cost of mine closure and
post-closure rehabilitation, including monitoring once the mining operations
cease. We fund these environmental rehabilitation costs by irrevocable
contributions to environmental trust funds that function under the authority of
trustees that have been appointed by, and who owe a statutory duty of trust to
the Master of the High Court of South Africa. The funds held in these trusts
are invested primarily in interest bearing debt securities. As of June 30, 2019,
we held a total of R508.9 million (2018: R118.0 million) in trust, the balance
held in each fund being R114.8 million (2018: R107.5 million) for Ergo, R382.9
million (2018: Rnil million) for FWGR and R11.3 million (2018:R10.5 million)
for ERPM. Trustee meetings are held as required and quarterly reports on the
financial status of the funds, are submitted to our board of directors. If any
of the operations are prematurely closed, the rehabilitation funds may be
insufficient to meet all the rehabilitation obligations of those operations.  Whereas
the old Minerals Act allowed for the establishment of a fully funded
rehabilitation fund over the operational life of mine, the MPRDA assumes a
fully compliant fund at any given time. Insurance instruments may also be
utilized to make up the shortfall in available cash funds subject to the DMR’s
consent. The Company has subsequently made use of approved insurance products
for a portion of its rehabilitation liabilities. As of June 30, 2019, we held a
total of R78.6 million (2018: R126.0 million) in funds held in insurance
instruments. As at June 30, 2019 guarantees amounting to R427.3 million (2018:
R427.3 million) were issued to the DMR.  The
provision for environmental rehabilitation for the group was R682.6 million at June
30, 2019, compared to R553.4 million at June 30, 2018 and R531.7 million at
2017.  New
Financial Provisioning Regulations (“FPR”) were promulgated on November 20,
2015 under the National Environmental Management Act, 107 of 1998 (“NEMA”)by the Department of
Environmental Affairs (“DEA”). Proposed amendments
to the FPRs were published for public comment GNR 1228 GG 41236 of 10 November
2017 (“Draft Regulations”), which seek to address some challenges relating to
the implementation thereof.  27


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Under the FRPs to be implemented by the
DMR, existing environmental rehabilitation trust funds, of which DRDGOLD has
R508.9 million, may be used only for post closure activities and may no longer
be utilized for their intended purpose of concurrent and final rehabilitation
on closure. As a result, new provisions will have to be made for these activities.  Further
amendments to the FPR, (“Proposed Amendments”) were published in
September 2018, which extends the compliance therewith to 19 February 2020.  The
Proposed Amendments, in their current form and which are still subject to the
approval of the DMR and Treasury, allow under certain circumstances for the
withdrawal against financial provision (which is currently not contemplated in
the FPR). It is therefore uncertain whether these provisions relating to
withdrawal will remain in their current form, or at all, in the draft which the
DEA is aiming to publish for comment in November 2018.  Regulation
5(4) of the Proposed Amendments states that the determination of financial
provision must be undertaken by a specialist, which according to the definitions
listed in the Proposed Amendments is an “independent person”. Regulation 10 of
the Proposed Amendments further requires the annual review and re-assessment of
financial provision by an independent specialist, which in terms of Regulation
11 of the Proposed Amendments must also be audited by an independent auditor.
The Proposed Amendments do not require that the annual review and re-assessment
of financial provision be audited by a financial auditor.  4C. ORGANIZATIONAL STRUCTURE  The following
chart shows our principal subsidiaries as of June 30, 2019 and as of
September 30, 2019 respectively. All of our subsidiaries are incorporated in
South Africa. Our voting interest in each of our subsidiaries are equal to our
ownership interests. We hold the majority of the investments directly or
indirectly as indicated below. Refer to Exhibit 8.1 for a list of our
significant subsidiaries.  28


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4D. PROPERTY, PLANT
AND EQUIPMENT  Description of Significant Subsidiaries' Properties and
Mining Operations, June 30, 2019 and September 30, 2019  Ergo  Overview  We
own 100% of Ergo. Ergo is a surface tailings retreatment operation operatingacross central and east Johannesburg.In order to improve synergies, effect cost savings
and establish a simpler group structure, DRDGOLD restructured the Group’s
surface operations (Crown,ERPM’s Cason Dump surface operation andErgoGold) into Ergo with effect from July 1, 2012.ERPM’s Cason Dump surface tailings retreatment operation was depleted in
the first half of fiscal year 2015.At June 30, 2019, Ergo employed 852 full-time
employees. In addition, specialist service providers deployed a further 1,362
employees to our operations bringing the total number of in-house and
outsourced employees to 2,214 at June 30, 2019 (at June 30, 2018: 2,288;at June 30, 2017:
2,215).  Properties  The
Ergo plant is located approximately 43 miles (70 kilometers) east of the
Johannesburg’s central business district in the province of Gauteng on land
owned by Ergo. Access to the Ergo plant is via the Ergo Road on the N17
Johannesburg-Springs motorway. As of June 30, 2019 and September 2019, no
encumbrances exist on Ergo's property.  Following the restructuring of the Crown operations,
which consisted of three separate locations, City Deep, Crown Mines and Knights,
into a single surface retreatment operation in Ergo, these mining rights were
transferred to Ergo in March 2014.  Our ore reserves in the western Witwatersrand had become
depleted. We therefore took a decision to close the Crown Mines plant which operated
as a pump/milling station feeding the metallurgical plants until March 2017. By
the end of fiscal year 2018, the Crown sites had been cleared and the
rehabilitation of the Crown plant site was substantially completed.  The
City Deep operation is located on the West Wits line within the Central
Goldfields of the Witwatersrand Basin, approximately 3 miles (5 kilometers)
south-east of the Johannesburg central business district in the province of
Gauteng. Access is via the Heidelberg Road on the M2 Johannesburg-Germiston
motorway. The City Deep plant continues to operate as a pump/milling station
feeding the metallurgical plants.  The
Knights operation is located at Stanley and Knights Road Germiston off the R29
Main Reef Road. The Knights plant continues to operate as a metallurgical
plant.  Mining and Processing  Ergo
undertakes the retreatment of surface tailings.  Material
processed by Ergo is sourced from primary surface sources namely, sand and
slime. The surface sources have generally undergone a complex depositional
history resulting in grade variations associated with improvements in plant
recovery over the period the material was deposited. Archive material is a
secondary source of gold bearing material. This material is generally made up
of old gold metallurgical plant sites.  Our
two gold producing metallurgical plants, Ergo and Knights have an installed capacity
to treat approximately 25 million tons of material per year based on 92%
availability
and are fully operational.All
of the plants have undergone various modifications during recent years
resulting in significant changes to the processing circuits. The City Deep
plant continues to operate as a pump/milling station feeding the metallurgical
plants.  Ergo’s
assets include: access to tailings deposited across the western, central and
eastern Witwatersrand; a 50km pipeline; and tailings deposition facilities
including the significant Brakpan/Withok TDF.  The
feed stock is made up of sand and slime which are reclaimed separately. Sand is
reclaimed using mechanical front-end loaders, re-pulped with water and pumped
to the plant. Slime is reclaimed using high pressure water monitoring guns also
known as hydraulic reclamation. The re-pulped slime is pumped to the plant and
the reclaimed material is treated using screens, cyclones, ball mills as well
as floatation and fine grind, or FFG, and Carbon-in-Leach, or CIL, technology
to extract the gold.  Set
forth below is a description of each of our plants in operation:  Ergo Plant:Commissioned by Anglo
American Corporation in 1977, became part of AngloGold Ashanti in 1998 from
which it was acquired for a consideration of R42.8 million in 2007. The
remaining five CIL tanks were refurbished during fiscal year 2015 to increase
capacity to treat up to 25.2Mt per year. The Ergo FFG project is designed to
assist in liberating the gold particles currently encapsulated in the sulphides
and to achieve a targeted improvement in gold recovery efficiencies of between
16% and 20%.  Knights Plant:Commissioned in 1988, this surface/underground plant
comprises a circuit including screening, primary cycloning, milling in closed
circuit with hydrocyclones, thickening, oxygen preconditioning, CIL, elution,
electro-winning and smelting to doré. The Knights plant, although historically
part of the Crown operation, is located further east and considerably closer to
the Brakpan TDF. 29


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Due to the location of the Knights
plant it is able to access the Brakpan TDF to deposit waste. The Knights plant
has an installed capacity to treat an estimated 3.6Mt per year.  City Deep Plant:Commissioned in 1987, this surface/underground plant
comprises a circuit including screening, primary, secondary and tertiary
cycloning in closed circuit milling, thickening, oxygen preconditioning, CIL,
elution and zinc precipitation followed by calcining and smelting to doré.
Retreatment continued at the City Deep Plant until the plant was decommissioned
in August 2013 to operate as a milling and pump station and is currently
pumping material to the Ergo Plant for the final extraction of gold.  As of June 30, 2019, the net book value of Ergo’s mining
assets was R1,300.4 million (2018: R 1,410.7 million).  Capital Expenditure  For a discussion of
capital expenditures in fiscal years 2017, 2018 and 2019, see "Item 5.A.
Operating and Financial Review and Prospects—Capital expenditure".  Currently there are
no material plans to construct or further expand Ergo’s facilities other than
optimising and maintaining existing facilities.Capital
expenditure is financed through cash resources and operational cash flows while
financing for significant growth projects may be obtained through specific
financing arrangements if required. For a summary of capital expenditure, see
Item 5A. Operating Results.  Exploration and Development  Exploration and development
activity at Ergo involves the drilling of surface dumps and evaluating the
potential gold bearing surface material.  Environmental and Closure Aspects  Municipal
infrastructure as well as commercial and residential developments have encroached
towards the Ergo operation. The major environmental risks are associated with
dust from various reclamation sites, and effective management of relocated
process material on certain tailings dams. The impact of windblown dust on the
surrounding environment and community is addressed through a scientific
monitoring and evaluation process, with active input from Professor H. Annagran
from theCape Peninsula
University of Technologyand appropriate
community involvement. Environmental management programs, addressing a wide
range of environmental issues, have been prepared by specialist environmental
consultants, which are audited annually. Water pollution is controlled by means
of a comprehensive system of return water dams which allow for used water to be
recycled for use in Ergo’s metallurgical plants. Overflows of return water dams
may, depending on their location, pollute surrounding streams and wetlands.
Ergo has an ongoing monitoring program to ensure that its water balances (in
its reticulation system, on its tailings and its return water dams) are
maintained at levels that are sensitive to the capacity of return water dams.  Dust
pollution is controlled through an active environmental management program for
the residue disposal sites and chemical and organic dust suppression on
recovery sites. Short-term dust control is accomplished through ridge ploughing
the top surface of dormant tailings dams. Additionally, environmentally
friendly dust suppressants are applied. Dust fall-out is monitored through an
extensive dust monitoring network monthly, and is utilized as a management
measure to ensure the effectiveness of mitigation measures employed. In the
long-term, dust suppression and water pollution is managed through a program of
progressive vegetation of the tailings followed by the application of lime, to
reduce the natural acidic conditions, and fertilizer to assist in the growth of
vegetation planted on the tailings dam.  A
program of environmental restoration that provides for the rehabilitation of
areas affected by mining operations during the life of the mine is in place.
The surface reclamation process at Ergo has several environmental merits as it
removes potential pollution sources and opens up land for development.  Environmental management and compliance is further
assisted by the in–house developed electronic monitoring system (Compliance
Management Tool) that incorporates all existing Environmental Impact
Assessments (“EIAs”), EMPs, Mining Right Conversions, Performance Assessments and
Social and Labor Plans (“SLPs”) associated with each mining right. The existing
and most recent studies are used to supplement the management components with
regards to the mining right boundaries and its required compliance parameters.
The individual management items are integrated to provide a holistic overview
of the state of each of the mining right areas. Spatial data pertaining to the
mining right boundaries is stored onto a central database and is utilized to
create a live map which illustrates the mining right area and various
environmental monitoring systems. This map depicts the mining right boundaries,
roads, rails, mine dumps, plants, rivers, pipeline routes, servitudes, way
leaves, municipal services and other spatial data relevant to our mining
operations.  While the ultimate amount of rehabilitation costs to be
incurred is uncertain, we have estimated that the total cost for Ergo, in
current monetary terms as at June 30, 2019 is approximately R485.3 million. As
at June 30, 2019, a total of R114.8 million (2018: R107.5 million) is held in
the Ergo Rehabilitation Trust Fund, previously called the Crown Rehabilitation
Trust Fund, which is an irrevocable trust, managed by specific responsible
people who we nominated and who are appointed as trustees by the Master of the
High Court of South Africa. In addition, a total of R56.2 million (2018: R52.2
million) is held in insurance instruments.  Ore
Reserves  As
at June 30, 2019, our Proven and Probable Ore Reserves of Ergo was 3.08 million
ounces, down from 3.28 million ounces at June 30, 2018 due to depletion. A
Mineral Resource competent person is appointed at each operation to review our
Ore Reserve calculations for accuracy. For Ergo, Mr. Gary Viljoen is the
designated competent person in terms of the SAMREC Code responsible for the
compilation and 30


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reporting of ore reserves. Ore
reserves were independently reviewed by Red Bush Geoservices Proprietary
Limited (Red Bush) for compliance with the SAMREC Code, the National Instrument
43-101 and the United States Securities and Exchange Commission (SEC) Industry
Guide 7.  Production  For
fiscal year 2019, production decreased to 144,453 ounces from 150,433 ounces in
fiscal year 2019mainly due the volume
throughput that decreased from 24,281Mt to to 23,162Mt. The impact of this
decrease was mitigated by the increase inthe
average yield from 0.193g/t to 0.194g/t.  Cash
operating costs in fiscal year 2019 increased $6.0 per ounce from $1,118 in
fiscal year 2018 to $1,124 per ounce mainly due to the decrease in production.  The
  following table details certain production and financial results of Ergo for
  the past three fiscal years.2019
 2018
 2017Production (imperial)Ore
  milled ('000 tons)
 23,162
 24,281
 24,958Recovered
  grade (oz/ton)
 0.006
 0.006
 0.005Gold
  produced (ounces)
 144,453
 150,433
 137,114Results
  of OperationsRevenue (R million)
 2,577.5
 2,490.4
 2,339.9Cost of sales (R million)
 2,414.7
 2,339.2
 2,307.0Cash operating cost (R million)
 2,311.1
 2,159.7
 2,087.9Cash operating costs (R/kilogram)1
 512,439
 458,866
 489,549All-in sustaining costs (R/kilogram)1
 521,907
 505,622
 530,930All-in cost (R/kilogram)1
 527,624
 524,651
 552,2431
  Cash operating cost, cash operating costs per kilogram, all-in sustaining
  costs per kilogram and all-in costs per kilogram are financial measures of
  performance that we use to determine cash generating capacities of the mines
  and to monitor performance of our mining operations. These are all non-IFRS
  measures. For a reconciliation of these measure see Item 5A.: “Operating
  Results - Reconciliation of cash cost per kilogram, all-in sustaining costs
  per kilogram and all-in costs per kilogram.”
 31


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FWGR  Overview  On July
31, 2018, we acquired surface gold processing assets and tailing storage
facilities in Carletonvillein the West Rand Goldfield of
Gauteng, 30km from Johannesburg,that include Driefontein 3 and 5, Kloof 1, Venterspost North and
South, Libanon, Driefontein 4, Driefontein 2 plant, Driefontein 3 plant, WRTRP
pilot plant, and land for the development of a central processing plant,
regional tailings storage facility and return water dam (together, the “WRTRP
Assets”) associated with Sibanye-Stillwater’s WRTRP, subsequently renamed
as FWGR.  This acquisition represents a significant increase in our assets,
which will impact our results in future years.  In connection with the
acquisition, we issued to Sibanye-Stillwater new shares equal to 38.05% of
outstanding shares and granted Sibanye-Stillwater an option to acquire up to a
total of 50.1% of our shareswithin a period of 2 years from the effective date of the
acquisition at a 10% discount to the prevailing market value. We acquired the
following assets as a result of the acquisition:  Asset (incl properties)
 DescriptionAdditional tailings dams
 Movable surface
  tailings dams which form part of the gold assets of the WRTRP Assets and
  which include Driefontein Dumps 3 and 5, Kloof 1, Venterspost North and South
  and Libanon Dump.DP2 Plant
 The Driefontein 2
  Plant which is located on Portion 6 of Farm Blyvooruitzicht No 116
  Registration Division I.Q. and Remainder of Portion 1 of the Farm Driefontein
  No 113, Registration Division I.Q., Gauteng Province.
  The DP2 Plant
  processed surface rock dumps (“SRD”) material, which was delivered by
  rail and truck. Throughput is achieved through two Semi-Autogenous Grinding
  (“SAG”) mills and a ball milling circuit, cyanide leaching and a
  Carbon-in-Pulp (“CIP”) plant. A Carbon-in-leach circuit was commissioned
  in 2014 at DP2 Plant to improve recoveries by replacing the aging CIP
  circuit.DP3 Plant
 The Driefontein 3
  Plant which is located on Portion 6 of Farm Blyvooruitzicht No 116,
  Registration Division I.Q., Gauteng Province.The DP3 Plant was originally
  designed as a uranium plant, but wasconverted to process low-grade
  surface rock in 1998. Similar to DP2 Plant, SRD ore was delivered by rail and
  truck. This plant has four SAG mills followed by cyanide leaching and a CIP
  circuit.Driefontein 4
 The current active
  tailings deposition facility which forms part of the gold assets of the WRTRP
  Assets.Pilot Plant
 The moveable LogiProc
  pilot plant established to test the processes, techniques and assumptions
  made in the definitive level design of the full scale retreatment of dumps as
  part of the WRTRP Assets and located at Driefontein 1 Plant.Plan and Materials
 Any and all drawings,
  plans, studies (including feasibility studies of a geological or geotechnical
  nature), surveys, reports (including sampling and assaying reports), maps
  (including geophysical,geological and/or drill maps), statements, schedules and other
  data in whatever form of a financial, technical, labour, marketing,administrative,
  accounting or other matters pertaining to the WRTRP Assets.Transferring Land
 The land upon which:
  ·the proposed Central Processing Plant (“CPP”)
  will be located after the subdivision of the Farm Rietfontein No 347Registration Division
  I.Q. Portion 35 and 73, GautengProvince;and
  ·the Regional Tailing Storage Facility and Return
  Water Dam will be located.Active Tailings Dams
 The Driefontein 1 and
  2, Kloof 2 and Leeudoorn currently active tailings dams are also required to be
  transferred under the acquisition agreement,for no additional consideration,
  once they have been decommissioned by Sibanye-Stillwater.Licences to Operate
 All the licences,
  permits, permissions, management plans and reports, as well as amendments,
  variations or modifications thereof from time to time necessary for
  Sibanye-Stillwater to operate the WRTRP Assets lawfully.Access Rights
 The grant of access
  to DRDGOLD of the:
  ·Driefontein 10 shaft;
  ·Kloof 10 shaft located in the Kloof mining area that
  is subject to the Kloof Mining Right, for the purpose of pumping and
   supplying, at the cost of WRTRP, the required quantities of water, as licenced,
  for the WRTRP Assets;
  ·rights, servitudes and agreements for installation,
  supply and distribution and maintenance of power supply; existing and
  proposed pipeline routes; servitudes; wayleaves and surface right permits;
  and
  ·Driefontein1 Gold Plant for the
  purpose of accessing the Pilot Plant.
  As of June 30, 2019 and September 30,2019, no encumbrances exist on FWGR's property.  AtJune 30, 2019, the net book value of FWGR’s
mining assets was R1,443.6 million.  32


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At June 30, 2019, FWGR employed 152
full-time employees. In addition, specialist service providers deployed a
further 229 employees to our operations bringing the total number of in-house
and outsourced employees to 381.  Mining and
Processing  FWGR undertakes the retreatment of
surface tailings.  Material processed by FWGR is sourced
fromDriefontein Dump 5. The surface sources
have generally undergone a complex depositional history resulting in grade
variations associated with improvements in plant recovery over the period the
material was deposited.  The DP2 gold producing metallurgical plant was
reconfigured to have an installed capacity to treat approximately 6 million
tons of material per year based on 92% availabilityand are fully operational. The plant has undergone
reconfiguration resulting in significant changes to the processing circuits.  Slime is reclaimed using high
pressure water monitoring guns also known as hydraulic reclamation. The
re-pulped slime is pumped to the plant and the reclaimed material is treated
using screens, cyclones, ball mills and Carbon-in-Leach, or CIL, technology to
extract the gold.  FWGR entered into a smelting agreement with
Sibanye-Stillwater to smelt and recover gold from gold loaded carbon produced
at the DP2 plant, and deliver the gold to Rand Refinery. In exchange for this
service, Sibanye-Stillwater receives a fee based on the smelting costs plus 10%
of the smelting costs. Rand Refinery performs the final refinement of all gold
produced. FWGR also engaged its fellow subsidiary, Ergo Mining Proprietary
Limited, to act as its agent and representative and to enter into a refining
services arrangement with Rand Refinery for the sale, marketing and export of
the refined gold of the Company. This agreement is expected to be in place
until the Company obtains its own refining license.  FWGR is currently operating under the
Sibanye-Stillwater Kloof mining right – new order mining right
GP30/5/1/2/2/66MR issued in 2007 and valid until 2027. FWGR is also operating
under the Driefontein mining right – new order mining right GP30/5/1/2/2/51MR
issued in 2007 and valid until 2037. Sibanye is entitled to mine all declared
material falling within this mining right and has all necessary statutory requirements
in place. A section 102 amendment to these mining rights in terms of the MPRDA
Amendment Act of 2014, has been submitted by Sibanye-Stillwater to permit the
reclamation activities of FWGR. We believe that the surface rights agreements
over both the Driefontein and Kloof rights for the TSFs and processing plant
sites are adequate for the Sibanye-Stillwater operations and would therefore be
applicable to FWGR.  Capital Expenditure  For a discussion of
capital expenditures in fiscal year 2019, see "Item 5.A. Operating and
Financial Review and Prospects—Capital expenditure".  Financing for
significant growth projects may be obtained through specific financing
arrangements if required. Capital expenditure incurred on the development of
Phase 1 of FWGR, of approximately R324.4 were financed through a combination of
borrowings (refer to the Revolving Credit Facility described inItem 10C. Material Contracts) and cash
resources and operational cash flows of the Group. For a summary of capital
expenditure, see Item 5A. Operating Results.  Exploration and Development  Exploration and
development activity at FWGR involves the drilling of surface dumps and
evaluating the potential gold bearing surface material,as well as exploratory and development activities around
Phase 2 of the project.  Environmental and Closure Aspects  The major environmental risks are associated with dust
from various reclamation sites, and effective management of relocated process
material on certain tailings dams. The impact of nuisance dust fallout on the surrounding
environment and community is addressed through a comprehensive monitoring
network, with active input from Professor H. Annagran from theCape Peninsula University of Technologyand appropriate community involvement. Environmental
management programs, addressing a wide range of environmental issues, have been
prepared by independent specialist environmental consultants, which are audited
annually. Water pollution where appropriate is controlled by means of a
comprehensive system of return water dams which allow for used process water to
be returned for use in FWGR’s metallurgical plant and hydraulic reclamation.
FWGR has an ongoing monitoring program to ensure that its water balances (in
its reticulation system, on its tailings and its return water dams) are
maintained at levels that are sensitive to the capacity of return water dams.  Nuisance
dust fallout is controlled through active mitigation measures described in the
environmental management program for the management of our activities. These
mitigation measures include environmentally friendly dust suppressants applied
to high impact areas, active wetting of access roads by water bowsers, a
network of high velocity sprayers on our active TSF. Dust fall-out is monitored
through an extensive dust monitoring network monthly and is utilized as a
management measure to ensure the effectiveness of mitigation measures employed.
In the long-term, dust suppression and water pollution will be managed through
concurrent rehabilitation of the tailings dam, thus reducing water ingress and
dust from exposed areas.  FWGR
will undertake concurrent rehabilitation of areas affected by mining operations
during the life of the mine. The surface 33


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reclamation
process at FWGR has several environmental merits as it removes pollution
sources and opens up land for development.  Environmental
management and compliance is further assisted by the in–house developed
electronic monitoring system (Compliance Management Tool) that details the
commitments made within the EMPs and Water Use Licenses to aid in keeping the
operation compliant to its statutory obligations. The existing and most recent
specialist studies are used to supplement the management components with
regards to the compliance parameters. The individual management items are
integrated to provide a holistic overview of the state of the operation.
Spatial data pertaining to the operation is stored on a Geographical
Information System (GIS) which provides a spatial overview of the operation
which includes environmental monitoring systems, rightboundaries, roads, rails,
mine dumps, plants, rivers, wetlands, pipeline routes, servitudes, way leaves,
municipal services and other spatial data relevant to our mining operations.  While the ultimate amount of rehabilitation costs to be
incurred is uncertain, we have estimated that the total cost for FWGR, in
current monetary terms as at June 30, 2019 is approximately R179.8 million. As
at June 30, 2019, a total of R382.9 million is held in the Ergo Rehabilitation
Trust Fund for the benefit of FWGR’s rehabilitation. The Ergo Rehabilitation
Trust Fund is an irrevocable trust, managed by specific responsible people who
we nominated and who are appointed as trustees by the Master of the High Court
of South Africa.  Ore
Reserves  As
at June 30, 2019, our Proven and Probable Ore Reserves of FWGR was 2.69 million
ounces. A Mineral Resource competent person is appointed to review our Ore
Reserve calculations for accuracy. For FWGR, Mr. Vaughn Duke is the
designated competent person in terms of the SAMREC Code responsible for the
compilation and reporting of ore reserves.  Production  Construction of Phase 1 commenced during August 2018 with R330.7
million spent on,inter alia, the reconfiguration of the DP2 plant and
relevant infrastructure to process tailings from the Driefontein 5 slimes dam
and deposit residues on the Driefontein 4 Tailings Storage Facility. During
this construction phase, some gold was produced at the adjacent Driefontein 3
plant (“DP3”). Early-stage commissioning of the DP2 plant commenced on December
6, 2018 with the pumping of reclaimed tailings into the carbon in leach (“CIL”)
circuit. Testing of the reconfigured plant and ramp-up of production continued
during the third quarter of the fiscal year ended 30 June 2019. Management
considered,inter alia, the design capacity of the plant, recoveries and
the ability to sustain production in determining the date of commercial
production. The date of commercial production for Phase 1 (excluding the
milling section) was determined to be April 1, 2019.  FWGR’s
DP2 plant achieved gold production of 4,855oz before the date of commercial
production ofPhase 1 (excluding the milling section).
R93.7 million working costs and R88.9 million proceeds from the sale of gold
produced were capitalized to additions to property, plant and equipment as
pre-production costs.  FWGR
achieved gold productionfrom its DP2 plant subsequent
to April 1, 2019 as well as its DP3 plantof
10,706 ouncesat an average yield of 0.261g/t.Volume
throughput during fiscal year 2019 was 1,277Mt.  Cash
operating costs in fiscal year 2019 were $688 per ounce.  The
  following table details certain production and financial results of FWGR
  since July 31, 2018, the date we commenced operations at FWGR.2019Production (imperial)Ore
  milled ('000 tons)
 1,277Recovered
  grade (oz/ton)
 0.008Gold
  produced (ounces)
 10,706Results
  of OperationsRevenue (R million)
 184.6Cost of sales (R million)
 131.3Cash operating cost (R million)
 111.8Cash operating costs (R/kilogram)1
 313,443All-in sustaining costs (R/kilogram)1
 450,820All-in cost (R/kilogram)1
 1,533,4431
  Cash operating cost, cash operating costs per kilogram, all-in sustaining
  costs per kilogram and all-in costs per kilogram are financial measures of
  performance that we use to determine cash generating capacities of the mines
  and to monitor performance of our mining operations. These are all non IFRS
  measures. For a reconciliation of these measure see Item 5A.: “Operating
  Results - Reconciliation of cash cost per kilogram, all-in sustaining costs
  per kilogram and all-in costs per kilogram.”
 See Item 5A.
Operating Results – Capital expenditure for a discussion on capital
expenditure.  ERPM 34


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Overview  In
December 2018, ERPM concluded revised agreements to dispose certain of its
underground assets to OroTree Limited (“OroTree”). The revised
agreements consisted of a disposal of ERPM's underground mining and prospecting
rights and an option agreement, at the sole discretion of OroTree, to purchase
the underground mining infrastructure exercisable on or before June 30, 2019. The
disposal of the underground mining and prospecting rights were concluded in the
second half of the financial year ended June 30, 2019. OroTree’s option to
purchase the underground mining infrastructure lapsed on June 30, 2019 when it did
not exercise said option. The underground mining infrastructure remains under
care and maintenance until final rehabilitation is completed.  At
June 30, 2019, ERPM had no employees. The financial results and remaining assets
and liabilities of these halted underground operations are included in
‘Corporate office and other reconciling items’ in the financial statements for
segmental reporting purposes for all three years presented.  Property  ERPM
is situated on the Central Rand Goldfield located within and near the northern
margin of the Witwatersrand Basin in the town of Boksburg, 20 miles (32
kilometers) east of Johannesburg on land owned by ERPM. Access is via Jet Park
Road on the N12 Boksburg-Benoni highway. Historically underground mining and
recovery operations comprised relatively shallow remnant pillar mining in the
central area and conventional longwall mining in the south-eastern area. Until
underground mining was halted in October 2008, the mine exploited the
conglomeratic South Reef, Main Reef Leader and Main Reef in the central area
and the Composite Reef in the south-eastern area.ERPM concluded the disposed its underground mining and prospecting
rights in the second half of the financial year ended June 30, 2019.  Surface
reclamation operations including the treatment of sand from ERPM’s Cason Dump,
was conducted through the Knights metallurgical plant, tailings deposition
facilities and associated facilities until ERPM’s surface mining assets were
transferred to Ergo as part of the restructuring which took place on July 1,
2012.  As of June 30,2019, and September 30,2019, no
encumbrances exist on ERPM's property.  At June
30, 2019, the net book value of ERPM’s mining assets was zero.   Mining
and Processing  ERPM’s
underground gold mining infrastructure is under care and maintenance.Surface reclamation operations and
surface mining assets were transferred to Ergo as part of the restructuring
which took place on July 1, 2012.  Exploration and Development  ERPM
disposed prospecting right ERPM Extension 1 covering an area of 1,252ha (3,094
acres) of the adjacent Sallies mine and ERPM Extension 2, for an additional
area of 5,500ha (13,590 acres) toOroTree Limited during the second half of the fiscal year ended
June 30, 2019.  Environmental
and Closure Aspects  There
is a regular ingress of water into the underground workings of ERPM, which was
contained by continuous pumping from the underground section. Studies on the
estimates of the probable rate of rise of water have been inconsistent, with
certain theories suggesting that the underground water might reach a natural
subterranean equilibrium, whilst other theories maintain that the water could
decant or surface.  The
government has appointed Trans-Caledon Tunnel Authority (TCTA) to construct a
partial treatment plant (neutralisation plant) to prevent the ground water
being contaminated. TCTA completed the construction of the neutralisation plant
for the Central Basin and commenced treatment during July 2014. As part of the
Heads of agreement signed in December 2012 between EMO, Ergo, ERPM and TCTA,
sludge emanating from this plant is co-disposed onto the Brakpan/Withok TDF.
Partially treated water is then discharged by TCTA into the Elsburg Spruit.
This agreement includes the granting of access to the underground water basin
through one of ERPM shafts and the rental of a site onto which it constructed
its neutralisation plant. In exchange, Ergo and its associate companies
including ERPM have a set-off against any future directives to make any
contribution toward costs or capital of up to R250 million.Through
this agreement, Ergo also secured the right to purchase up to 30 ML of
partially treated AMD from TCTA at cost, in order to reduce Ergo’s reliance on
potable water for mining and processing purposes.  While
the ultimate amount of rehabilitation costs to be incurred in the future is
uncertain, we have estimated that as at June 30, 2019 the present discounted
value of the total cost of rehabilitation for ERPM is approximately R17.4
million (2018: R15.8 million). A total of R11.3 million (2018: R10.5 million) is
held in the Ergo Rehabilitation Trust Fund (previously called the Crown
Rehabilitation Trust Fund) for the benefit of ERPM and R22.4 million (2018: R73.7
million) is held in insurance instruments and is available for the settlement
of these rehabilitation costs. The Ergo Rehabilitation Trust Fund is an
irrevocable trust, managed by specific responsible people who we nominated and
who are appointed as trustees by the Master of the High Court of South Africa.  Ongoing
Legal Proceedings  Ekurhuleni
Metropolitan Municipality (“Municipality”) Electricity Tariff Dispute 35


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Refer toItem 18.‘‘Financial
Statements - Note 26–Contingent Assets and Liabilities”.  Silicosis
Litigation  Refer toItem 18.‘‘Financial
Statements - Note 26–Contingent Assets and Liabilities”.  ITEM 4A. UNRESOLVED STAFF COMMENTS  None.   ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS  This
section should be read in conjunction with, our audited financial statements
and the other financial information contained elsewhere in this Annual Report.
Our financial statements have been prepared in accordance with International
Financial Reporting Standards (“IFRS”) as issued by the International
Accounting Standards Board (“IASB”). Our discussion contains forward
looking information based on current expectations that involve risks and
uncertainties, such as our plans, objectives and intentions. Our actual results
may differ from those indicated in such forward looking statements.  Comparison of
financial performance for the fiscal year ended June 30, 2018 with fiscal year
ended June 30, 2017  This
comparison analysis can be found in Item 5A of the Company’s annual report on
Form 20-F for the fiscal year ended June 30, 2018.   5A. OPERATING RESULTS  Business overview  We are a South African gold mining company engaged insurface gold tailings retreatment,
including exploration, extraction, processing and smelting. All our surface
tailings retreatment operations, including the requisite infrastructure and
metallurgical processing plants, are located in South Africa.  The success of DRDGOLD’s long-term goal to extract as much gold as
possible and economically viable from its assets depends, to a large extent, on
how effectively it continues to manage its resources.  DRDGOLD’s strategic thinking is informed by principles of
sustainable development. Our goal is to optimally exploit our entire resource
over the long term, thereby seeking sustainable benefits in respect to the
following capitals, each of which is essential to our operation – financial,
manufactured, natural, human and social capital.  We also aim to align and overlap the interests of each of these
capitals in such a manner that an investment in any one translates into
value-add in as many of the others as possible. We therefore seek to achieve an
enduring and harmonious alignment between them, and we pursue these criteria in
the feasibility analysis of each investment.  Our
profit for fiscal 2019 increased compared to fiscal 2018, mainly due to,inter alia, the following: ·gold production increased by 3% mainly due to the maiden
contribution made by FWGR of 333kg, mitigating the impact of Ergo’s gold
production that decreased by 4%; ·the average rand gold price received increased by 8%; ·profit for fiscal year 2018 included non-recurring
transactions costs on the acquisition of the WRTRP assets from
Sibanye-Stillwater of R9.0 million incurred in fiscal 2018; ·profit for fiscal year 2019 included profit on disposal
of property, plant and equipment amounting to R5.8 million; and ·a non-recurring credit of R60.0 relating primarily to a
change in estimate of Ergo’s provision for environmental rehabilitation.  On July 31, 2018, we completed the acquisition of the gold assets
associated with Sibanye-Stillwater’s WRTRP, to be known going forward as FWGR. 
This acquisition represented a significant increase in our assets, which impacted our results in fiscal year 2019 and will impact our results in future years.  In connection with the
acquisition, we issued to Sibanye-Stillwater new shares equal to 38.05% of
outstanding shares, and granted Sibanye-Stillwater an option to acquire up to a
total of 50.1% of our shareswithin a period of 2
years from the effective date of the acquisition at a 10% discount to the
prevailing market value.  Key
drivers of our operating results and principal factors affecting our operating
results  The principal uncertainties and variables facing our business and,
therefore, the key drivers of our operating results are:  ·The price of gold, which fluctuates both in terms of dollars and
rands; ·Our production tonnages and gold content thereof, impacting on the
amount of gold we produce at our operations; ·Our cost of producing gold, including the effects of mining
efficiencies; and 36


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·General economic factors, such as exchange rate fluctuations and
inflation, and factors affecting mining operations in South Africa.  Gold
price  Our revenues are derived
primarily from the sale of gold produced at our surface tailings retreatment
operations. As a result, our operating results are directly related to the
price of gold, which can fluctuate widely and is affected by numerous factors
beyond our control, including industrial and jewelry demand, expectations with
respect to the rate of inflation, the strength of the U.S. dollar (the currency
in which the price of gold is generally quoted) and of other currencies,
interest rates, actual or expected gold sales by central banks, forward sales
by producers, global or regional political or economic events, and production
and cost levels in major gold-producing regions such as South Africa. In
addition, the price of gold is often subject to rapid short-term changes
because of speculative activities. The demand for and supply of gold affects
gold prices, but not necessarily in the same manner that supply and demand
affect the prices of other commodities. The supply of gold consists of a
combination of new production from mining and existing stocks of bullion and
fabricated gold held by governments, public and private financial institutions,
industrial organizations and private individuals.  The following table indicates
data relating to the dollar gold spot prices for the 2019 and 2018 fiscal
years:  2019 fiscal year
 2018 fiscal year
 Change$ per ounce
 $ per ounce
 %Closing
  gold spot price on June 30,
 1,409
 1,252
 13Lowest
  gold spot price during the fiscal year
 1,160
 1,204
 (4)Highest
  gold spot price during the fiscal year
 1,439
 1,366
 5Average
  gold spot price for the fiscal year
 1,263
 1,297
 (3)
  All our operations and gold production is based in South Africa,
and as a result, the impact of movements in relevant exchange rates is
significant to our operating results.The average gold
price in rand (based on average spot prices for the year)decreasedby3%from R17,094per ounce in2017to R16,662per ounce in2018, andincreasedby8%to R17,914per ounce in2019.  An increase/(decrease) of 10% in the rand gold price throughout
fiscal year 2019 would have increased/(decreased) revenue by approximately R276.2
million (2018: R249.0 million).  Gold production In
fiscal year 2019, gold production increased to 155,159 ounces (produced from 24.4
million tonnes milled at an average yield of 0.197g/t) from 150,433 ounces in
fiscal year 2018 (produced from 24.3 million tonnes milled at an average yield
of 0.193g/t). This wasmainly due to the
maiden gold production of FWGR of 10,706ounces,
mitigating the impact of Ergo’s gold production which decreased to 144,453
ounces in fiscal year 2019 (produced from 23.2 million tonnes milled at an
average yield of 0.194g/t) from 150,433 ounces in fiscal year 2018 (produced
from 24.3 million tonnes milled at an average yield of 0.193g/t).  In fiscal year 2018, gold produced increased to 150,433 ounces
(produced from 24.3 million tonnes milled at an average yield of 0.193g/t) from
137,114 ounces in fiscal year 2017 (produced from 25.0 million tonnes milled at
an average yield of 0.171g/t). This wasmainly
due to (i) not treating material from the Crown sites that were closed during fiscal
year 2017 at a higher cost as well as (ii) treating higher grade material
reclaimed from the 5A9 and 4L30 dumps through the Knights Plant during fiscal
year 2018.  Cash
operating costs  Cash
operating costs is anon-IFRS
financial measure of performance that isreported tothe group’s chief operating decision maker (CODM) andis used to monitor performance– refer
toItem 18. ‘‘Financial Statements - Note 23
– Operating Segments”.For a reconciliation of this measure see Item
5A.: “Reconciliation of cash cost per kilogram, all-in sustaining costs per
kilogram and all-in costs per kilogram”.  Cash
operating costs include consumables, labor, specialized service providers,
electricity and other related costs incurred in the production of gold.
Consumables, water and electricity, labor, specialized service providers and
other costs are the largest components of cash operating costs. A breakdown of
cash operating costs into these costs is described in Item 5A.: “Comparison
of financial performance for the fiscal year ended June 30, 2019 with fiscal
year ended June 30, 2018”  General economic factors We are exposed to a number of factors, which could affect our
profitability, such as exchange rate fluctuations, inflation and other risks
relating to South Africa. In conducting mining operations, we are subject to
the inherent risks and uncertainties of the industry, and the wasting nature of
the assets.  Effect
of exchange rate fluctuations  For the fiscal years 2019, 2018 and 2017, all of our revenues were
generated from South African operations, all of our operating costs were
denominated in rand and we derived all of our revenues in dollars before being
translated to rands. As the price of gold is denominated in dollars which is
then translated into rands, the appreciation of the dollar against the rand
increases our profitability, whereas the depreciation of the dollar against the
rand reduces our profitability. 37


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In fiscal year 2019 the Rand gold price received increased by 8%
compared to fiscal year 2018 due to the combined impact of the average Dollar
gold price which decreasedby2%and the
average exchange rate of the rand against the dollar that weakened by 10%.  In line with our long-term strategy of being an unhedged gold
producer, we generally do not enter into forward gold sales contracts to reduce
our exposure to market fluctuations in the Dollar gold price or the exchange
rate movements. If revenue from gold sales falls for a substantial period below
our cost of production at our operations, we could determine that it is not
economically feasible to continue commercial production at any or all of our
plants or to continue the development of some or all of our projects. However,
during periods when medium-term debt is incurred to fund growth projects and
hence introduce liquidity risk to the Group, we may mitigate this liquidity
risk by entering into facilities to achieve price protection (referItem 11. Quantitative and
Qualitative Disclosures About Market Risk – General). For example in fiscal 2019 we entered into a hedging instrument in
the form of a collar in respect of 50,000 ounces of gold that expired at the
end of May 2019.  Effect of inflation
and exchange rates  In the
past, our operations have been materially adversely affected by inflation. If
there is a significant increase in inflation in South Africa, our costs will
increase and if such a cost increase is not offset by an increase in the rand
price of gold, this will negatively affect our operating results.  The
movements in the rand/dollar exchange rate, based upon average rates during the
periods presented, and the local annual inflation rate for the periods
presented, as measured by the South African Consumer Price Index, or CPI, are
set out in the table below: Fiscal year endedYear ended June 30,
 2019
 2018
 2017(%)
 (%)
 (%)The
  average rand/dollar exchange rate (strengthened)/weakened by
 10
 (5)
 (6)CPI
  (inflation rate)
 4.5
 4.6
 5.1
  Recent
developments  Evaluation of FFG
circuit  The
operation of the FFG circuit was temporarily halted in the first quarter of
fiscal 2020 to perform an evaluation and compare the additional revenues earned
from extracting additional gold from the most recently integrated reclamation
sites compared to the cost incurred to operate the FFG circuit. The evaluation
also includes considering alternative configurations of the FFG circuit and
alternative means of extracting gold using the FFG circuit. At the date of this
report, the evaluation is ongoing.  Commissioning of
Mills at FWGR Phase 1  FWGR
achieved the 500 000tpm planned throughput from Phase 1 for the quarter ended
September 30, 2019 and successfully started operating their mills at the
beginning of September 2019.  Key financial and
operating indicators  The table below presents the key performance measurement data for
the past three fiscal years: The financial results for the fiscal years below
are stated in accordance with IFRS as issued by the IASB. The table also
includes the key performance measures for our business and its profitability,
which are revenue, gold production, gold prices, operating costs, cash
operating costs per kilogram, all-in sustaining costs per kilogram and all-in
costs per kilogram, capital expenditure (additions to property, plant and
equipment) and Ore Reserves.  Operating dataYear ended June 30,2019
 2018Revenue
  (R'm)
 2,762.1
 2,490.4Gold
  production (ounces)
 155,159
 150,433Gold
  production (kilograms)
 4,826
 4,679Gold
  sold (ounces)
 153,777
 149,597Gold
  sold (kilograms)
 4,783
 4,653Average
  spot gold price (R/kilogram)
 575,954
 535,696Average
  gold price received (R/kilogram)
 577,483
 534,368Cost
  of sales (R'm)
 2,553.9
 2,347.7Operating
  costs (R'm)
 2,471.1
 2,207.1Cash
  operating costs (R'm)(1)
 2,422.9
 2,159.7Cash operating
  costs (R/kilogram)(1)
 499,749
 458,866All-in
  sustaining costs (R/kilogram)(1)
 524,713
 505,622All-in costs (R/kilogram)(1)
 600,941
 524,651Additions
  to property, plant and equipment (R'm)
 353.8
 126.1Ore
  Reserves (ounces)
 5,770,000
 3,280,000(1)
  Cash operating costs, cash operating costs per kilogram, all-in sustaining
  costs, all-in sustaining costs per kilogram and all-in costs and all-in costs
  per kilogram are non-IFRS financial measures of performance that we use to
  monitor performance. A reconciliation of these measures to the nearest IFRS
  measure is included in Item 5A.: “Operating Results - Reconciliation of cash
  cost per kilogram, all-in sustaining costs per kilogram and all-in costs per
  kilogram.”
 38


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Revenue  Revenue
increased by 11% to R2,762.1 million in fiscal year 2019 from R2,490.4 million
in fiscal year 2018 mainly due to the impact of gold sold thatincreased by 3% from 4,653 kilograms in fiscal
2018 to 4,783 kilograms in fiscal 2019 and the average rand gold price received
that increased by 8% to R577,483 per kilogram.  Refer to Item 5A:. “Operating results:
Key drivers of our operating results and principal factors affecting our
operating results” for a discussion regarding the gold price received and
production levels.  Ore
Reserves  As at
June 30, 2019, our Ore Reserves(imperial)were
estimated at 5.77 million ounces, as compared to 3.28 million ounces at June
30, 2018. The increase was due to the acquisition of FWGR which added
surface Ore Reserves of 2.72Moz. The increase was offset by depletion through
ongoing mining activities and other survey adjustments.    Year ended June 30,2019
 2018Ore
  Reserves
 Ounces
 Kilograms
 Ounces
 Kilograms‘000
 
 ‘000Ergo
 3,080
 99,024
 3,280
 105,454FWGR
 2,690
 86,517
 -
 -Total
  Ore Reserves
 5,770
 185,541
 3,280
 105,454
  Capital expenditure  During
fiscal year 2019 capital expenditure increased by R221.5 million to R347.4 million
from R125.9 million in fiscal year 2018. Capital expenditure increased primarily
as a result of R324.4 million incurred on the development of Phase 1 of FWGR.  During
fiscal year 2018 capital expenditure increased by R15.3 million to R125.9 million
from R110.6 million in fiscal year 2017. Capital expenditure increased
primarily as a result of R41.3 million spent on the installation of two ball
mills at Ergo in order to process higher grade sand at better margins (these
mills were reclaimed from the now decommissioned Crown plant), R24.3 million
spent on the ramp-up of reclamation from the 4L50 slimes dam, which is the southern
portion of the Elsburg Tailings Complex, bordering Boksburg and Germiston;
R14.4 million spent on conversion of the Ergo plant’s electro-winning circuit
to zinc precipitation and EBDA also spent R17.8 million on building a new lodge
to support training services rendered.  Critical accounting
policies that require significant judgment 39


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The preparation of the consolidated
financial statements requires management to make accounting assumptions,
estimates and judgements that affect the application of the Group's accounting
policies and reported amounts of assets and liabilities, income and expenses.
By their nature, judgements are subject to an inherent degree of uncertainty.
Accounting assumptions, estimates and judgements are reviewed on an ongoing
basis. Revisions to reported amounts are recognized in the period in which the
revision is made and in any future periods affected. Actual results may differ
from these estimates.  Management believes the following
critical accounting policies involve the more significant assumptions and
estimates used in the preparation of our consolidated financial statements and
could potentially impact our financial results and future financial
performance:  ·Acquisition of Assets and Liabilities ·Depreciation of property, plant and equipment ·Impairment of property, plant and equipment ·Estimation of future environmental rehabilitation costs ·Income tax ·Payments made under protest  Management believes the following
critical accounting policies involve the more significant judgements used in
the preparation of our consolidated financial statements and could potentially
impact our financial results and future financial performance:  ·Acquisition of Assets and Liabilities ·Date of commercial production ·Payments made under protest ·Contingent assets and liabilities  Management has discussed the development and selection
of each of these critical accounting policies with the Board of Directors and
the Audit and Risk Committee, both of which have approved and reviewed the
disclosure of these policies. This discussion and analysis should be read in
conjunction with the consolidated financial statements and related notes
included in Item 18. “Financial statements”.  Acquisition of Assets and Liabilities  The IFRS
applicable for this transaction is IFRS 2 Share-based payment, as it represents
a receipt of goods (assets) in exchange for equity instruments of DRDGOLD. The
consequence thereof is that the assets and liabilities are recognised at their
fair value using principles under IFRS 13 Fair Value Measurement. A
corresponding increase in equity is also recognised. No deferred tax is
recognised on the transaction as it has not been accounted for as a business
combination under IFRS 3 Business Combinations, and therefore the initial
recognition exemption applies in terms of IAS 12 Income Taxes.  The assessment of whether the acquisition of the assets
and liabilities by DRDGOLD Limited (DRDGOLD) constituted an acquisition of
assets under IFRS 2 or a business combination under IFRS 3 required the
exercise of judgement due to the application of the business definition under
IFRS 3 to the nature of the assets. Key judgements made in the conclusion that
the acquisition did not meet the definition of a business under IFRS 3 include
that DP2 required decommissioning and reconfiguration from processing hard rock
material to tailings material, thus outputs couldn’t be produced at acquisition
date; the workforce acquired did not have the required skill or ability to
process tailings and were required to be trained with DRDGOLD’s intellectual
property; and that Sibanye-Stillwater did not process any tailings through the
DP2 or DP3 plants and neither could DRDGOLD at acquisition date, without
reconfiguring the assets acquired.  The fair
value of the assets was determined using the income approach present value
technique by applying a nominal discounted future cash flow model which was
based on the Phase 1 and Phase 2 project plan for the assets, determined with
the assistance of an independent expert. These calculations require use of
assumptions and estimates and are inherently uncertain and could materially
change over time. These assumptions and estimates include mineral reserves and
resource estimates, production estimates, spot and future gold prices, foreign
currency exchange rates, discount rates, estimates of costs to produce, future
capital expenditure and the timing of cash flows in determining the fair value.
The model was based on a forward-looking gold price of R562 481 per kilogram in
year one and operating costs escalating at an average of approximately 5.7% a year
over a discount period of 20 years and a risk adjusted discount rate based on
the nominal weighted average cost of capital of 15.03%. The discounted cash
flow model is highly sensitive to changes in the forward-looking gold price and
discount rate.  The fair
value of the future environmental cost was determined with the assistance of an
independent expert and was based on environmental management plans of Phase 1
and Phase 2 of the project which were developed in accordance with regulatory
requirements. An average discount rate of 8.65% and average inflation rate of
5.7% and a discount period of 14 years, were used in the calculation of the
estimated net present value of the rehabilitation liability.  Date of commercial production  The
Company assesses the stage of the construction project to determine when the
project moves into the production stage. The criteria used to assess the start
date are determined based on the unique nature of each construction project.
The Company considers various relevant criteria to assess when the construction
project is substantially complete, ready for its intended use and moves into
the production stage. Some of the criteria would include, but are not limited
to the following: • the
level of capital expenditure compared to the construction cost estimates; 40


---

•
the required technical specifications of assets being constructed; •
ability to produce metal in saleable form (within specifications); and •
ability to sustain commercial levels of production of metal.  Depreciation of property, plant and equipment  Depreciation
of mine plant facilities and equipment, as well as mining property and
development (including mineral rights) are calculated using the units of
production method which is based on the life-of-mine of each site. The
life-of-mine is primarily based on proved and probable mineral reserves. It
reflects the estimated quantities of economically recoverable gold that can be
recovered from reclamation sites based on the estimated gold price. Changes in the
life-of-mine will impact depreciation on a prospective basis. The life-of-mine
is prepared using a methodology that takes account of current information to
assess the economically recoverable gold from specific reclamation sites and
includes the consideration of historical experience.  Impairment of property, plant and equipment  The carrying amounts of property, plant and equipment are
reviewed at each reporting date to determine whether there is any indication of
impairment, or whenever events or changes in circumstances indicate that the
carrying amount may not be recoverable. If any such indication exists, the
asset’s recoverable amount is estimated. For the purposes of assessing
impairment, assets are grouped at the lowest levels for which there are
separately identifiable cash flows (CGUs). The key assets of a surface
retreatment operation which constitutes a CGU are a reclamation site, a
metallurgical plant and a tailings storage facility. These key assets operate
interdependently to produce gold. The Ergo and FWGR operations each have
separately managed and monitored reclamation sites, metallurgical plants and
tailings storage facilities and are therefore separate CGUs.  The recoverable amount of an asset or CGU is the greater
of its value in use and its fair value less costs to sell. The recoverable
amount was determined by estimating the value in use. The estimated future cash
flows are discounted to their present value using a pre-tax discount rate that
reflects current market assessments of the time value of money and the risks
specific to the asset. An impairment loss is recognised in profit or loss if
the carrying amount of an asset or CGU exceeds its recoverable amount.  Future
environmental rehabilitation costs  Provisions
for environmental rehabilitation are provided at the present value of the costs
expected to be incurred in the future to settle the obligation based on current
prices. The unwinding of the obligation is included in profit or loss.
Estimated future costs of environmental rehabilitation are reviewed regularly
and adjusted as appropriate. Changes in estimates are capitalized or reversed
against the related asset but taken to profit or loss if there is no related
asset left. Gains or losses from the expected disposal of assets are not taken
into account when determining the provision.  Estimates
of future environmental rehabilitation costs are based on the Group’s
environmental management plans which are developed in accordance with
regulatory requirements, the life-of-mine plan and the planned method of
rehabilitation which is influenced by developments in trends and technology.  Income
tax  Deferred
tax is recognized in respect of temporary differences between the carrying
amounts of assets and liabilities for financial reporting purposes and the
amounts used for tax purposes.  The deferred tax liability is calculated by
applying a forecast weighted average tax rate that is based on a prescribed
formula. The calculation of the forecast weighted average tax rate requires the
use of assumptions and estimates and are inherently uncertain and could change
materially over time. These assumptions and estimates include the expected
future profitability and timing of the reversal of the temporary differences.
Due to the forecast weighted average tax rate being based on a prescribed
formula that increases the effective tax rate with an increase in forecast
future profitability, and vice versa, the tax rate can vary significantly year
on year and can move contrary to current period financial performance.  Payments
made under protest  The assessment to
develop and apply the relevant accounting policy for payments made under
protest that arise from the Municipality Electricity Tariff Dispute (refer note
26) (“Payments made under protest“) requires the exercise of significant
judgement about the outcome of future events that are not wholly under the
control of the Group.  The judicial
proceedings that impact the Payments made under protest are inherently complex
legal issues that are subject to uncertainties and complexities and are subject
to interpretation.  The discounted
amount of the Payments made under protest is determined using assumptions about
the future that are inherently uncertain and can change materially over time
and includes the discount rate and discount period.  These assumptions
about the future include estimating the timing of concluding on the main
application, i.e. the discount period, the ultimate settlement terms (refer
note 26), the discount rate applied and the assessment of recoverability.  Recognition and measurement  The
asset that arises from the Ekhurhuleni electricity dispute (refer note 26) and
that are payments made under protest is initially 41


---

measured
at a discounted amount and any difference between the face value of payments
made under protest and the discounted amount on initial recognition is recognised
in profit or loss as a finance expense. Subsequent to initial recognition, the
Payments made under protest is measured using the effective interest method to
unwind the discounted amount to the original face value less any write downs
for recovery. Unwinding of the carrying value and changes in the discount
period are recognised in the statement of profit or loss.  Assessment
of recoverability The
discounted amount of the payments under protest is assessed at each reporting
date to determine whether there is any objective evidence that the full amount
is no longer expected to be recovered. The Group considers the reasonable and
supportable information related to the creditworthiness of Ekurhuleni
Metropolitan Municipality and events surrounding the outcome of the Main
Application (refer note 26).  Any write down is recognised in the statement of
profit or loss.  Contingent
liabilities  The
assessment of the impact of contingent liabilities require the exercise of
significant judgement and estimates of the outcome of future events that are
not wholly within the control of the Group. Litigation and other judicial
proceedings inherently entail complex legal issues that are subject to
uncertainties and complexities and are subject to interpretation.  New
standards, amendments to standards and interpretations  Refer
to Item 18. ‘‘Financial Statements - Note 3 – New standards, amendments to standards
and interpretations” for a discussion of relevant standards, amendments to
standards and interpretations that may be applicable to the business of the
Group and may have an impact on future consolidated financial statements.  Comparison of
financial performance for the fiscal year ended June 30, 2019 with fiscal year
ended June 30, 2018  Revenue  The
following table illustrates the year-on-year change in revenue for fiscal year 2019
in comparison to fiscal year 2018:  R million
 Total
 Impact of change in amount of gold sold
 Impact of change in gold price
 Net change
 Totalrevenue
 revenue2018
 2019Ergo
 2,490.4
 (93.5)
 180.3
 86.7
 2,577.5FWGR
 -
 184.6
 -
 184.6
 184.6Consolidated
 2,490.4
 91.1
 180.3
 271.3
 2,762.1
  Revenue increased
by R271.7 million, or 11%, to R2,762.1 million during fiscal year 2019.This was mainly due to the average rand gold
price received which increased by 8% to R577,483 per kilogram  as well as gold
sold having increased by 3%, reflecting the 3% increased gold production mainly due to the maiden contribution made by FWGR of
333kg gold sold, mitigating the impact of Ergo’s
gold production which decreased by 4%.  Cost of
sales  Cost
of sales amounted to R2,553.9 million in fiscal 2019, consisting mainly of
operating costs of R2,471.1 million, depreciation of R169.1million and a positive movement in both change in estimate
of environmental rehabilitation of R60.0 million
and gold in process of R32.6 million. These are
discussed as follows:  Operating
costs  Operating
costs were R2,471.1 million for fiscal year 2019 compared
to R2,207.1 million for fiscal year 2018. The
increase was mainly due to inflationary increases.  42


---

Depreciation  Depreciation
charges were R169.1 million for fiscal year 2019
compared to R168.0 million for fiscal year 2018.  Change
in estimate of environmental rehabilitation  As
of June 30, 2019, we estimate our total rehabilitation provision, being the
discounted estimate of future costs, to be R682.6million as compared toR553.4million at June 30, 2018. Achange in estimate of environmental rehabilitation of R60.0
million was recognized due to updated vegetation and
machine hire rates to recent service level agreements and actual rates
incurred, as well as, in line with the Group’s strategy to reduce
externally sourced potable water, alternative water sources found to be viable
to meet the Crown Complex post closure water requirements.  A total
of R508.9 million was invested in our various
environmental trust funds as at the end of fiscal year 2019, as compared to R118.0 million
at the end of fiscal year 2018. The increase is attributable primarily due to
the receipt of R360.4 million as a result of the acquisition of FWGR of as well
as R30.5 million interest received on these funds
during fiscal year 2019. A total of R78.6 million
(2018: R126.0 million) is invested infunds
held in insurance instruments to securefinancial guarantees provided to
the DMR through an insurance cell captive company, the Guardrisk Cell Captive. The
increase is attributable toR7.9million interest received on these funds during fiscal year 2019.As at June 30, 2019 guarantees amounting to R427.3 million were in issue to the DMR (2018: R427.3
million).The shortfall between the invested funds and the estimated
provisions is expected to be financed by ongoing contributions to the Guardrisk
Cell Captive, over the remaining production life of the respective mining
operations and, at the time of mine closure, the proceeds on the disposal of
remaining assets and gold from plant clean-up.  Movements
in gold in process  Movement
in gold in process in fiscal year 2019 amounted to a increased of R32.6 million mainly due to an increase in the lock up
of gold in process at the DP 2 plant at FWGR as at June 30, 2019.  Administration
expenses and general costs  Administration
expenses and general costs increased by R0.8 million from R90.1 million
in fiscal year 2018 to R90.9 million in fiscal
year 2019. Administration expenses and general costs in fiscal year 2019
included long-term incentives of R21.4 million and legal costs amounting to
R2.8 million. In fiscal year 2018, administration
expenses and general costs included long-term incentives of R17.2 million and
legal costs amounting to R6.1 million.  Finance
income  Finance
income increased from R38.8 million in fiscal
year 2018 to R58.3 million in fiscal year 2019, mainly
due tohigher environmental trust fund balances during the year
as a result of the acquisition of FWGR.  Finance expenses  Finance
expenses increased from R58.4 million in fiscal
year 2018 to R78.4 million in fiscal year 2019, mainly
attributable to the increase in the unwinding of the provision for
environmental rehabilitation and a discount recognised on Payments made under
protest of R6.5 million (including a change in the timing of cash flows).  Income
tax  Income
tax amounted to a charge of R26.6 million for
fiscal year 2019 compared to an income tax charge of R25.9 million for
fiscal year 2018) and consisted of a current tax benefit of R1.7 million, mostly relating to non-mining
income, and a deferred tax charge for fiscal year 2019 of R28.3 million, mostly relating to mining income.  The income tax charge resulted from our profit
before tax in fiscal year 2019 as well as a charge of R15.0 million relating to
the forecast weighted average deferred tax rate that increased from 20.3% in
fiscal year 2018 to 22.0% in fiscal year 2019 because of an increase in
forecast profitability of Ergo. The increase in the effective tax rate resulted
in an increase in the deferred tax liability and the associated tax charge.  Non-IFRS Measures  Set
forth below is a discussion of non-IFRS measures presented in this report, including
a reconciliation of such measures to the nearest measure under IFRS, as well as
an explanation as to why we believe that presentation of such information
provides useful information to investors and additional purposes, if any, for
which we use such measures.  Adjusted earnings
before interest, interest, depreciation and amortization (“Adjusted EBITDA”)  Set
forth below is a presentation of our Adjusted EBITDA, which is a non-IFRS
measure, including the items included in this measure and a reconciliation to
profit for the year.Our calculation of Adjusted EBITDA is based on the calculation of
this measure as included in our 43


---

RCF agreement,
and may not be comparable to similarly titled measures of other companies.
Adjusted EBITDA is not a measure of performance under IFRS and should be
considered in addition to, and not as a substitute for, other measures of
financial performance and liquidity.We consider Adjusted EBITDA for the purpose of evaluating
compliance with the covenants imposed by the Company’s borrowing agreements
entered into on August 1, 2019 to finance the development of Phase 1 of FWGR
and working capital requirements of the Group. The Group considers the
presentation of Adjusted EBITDA provides useful information to investors to
enable investors to assess compliance with our covenants in the RCF agreement. 44


---

Year ended, June 302019Reconciliation of adjusted EBITDAProfit for the year
 78.5Income tax
 26.6Profit before tax
 105.1Finance expense
 (58.3)Finance income
 78.4Profit from operating activities
 125.2Depreciation
 169.1Share based payment
 21.4Change in estimate of environmental rehabilitation recognised in
  profit or loss
 (60.0)Gain on financial instruments at fair value through profit or
  loss
 (2.1)Gain on disposal of property, plant and equipment
 (5.8)Retrenchment costs
 6.3Adjusted earnings before interest, tax depreciation and
  amortisation ("Adjusted EBITDA")1
 254.11See Glossary of Terms for
  definitions.
 Cash operating
costs, cash operating costs per kilogram, all-in sustaining costs and all-in
costs per kilogram  Cash
operating costs per kilogram, all-in sustaining costs per kilogram and all-in
costs per kilogram are non-IFRS financial measures that should not be
considered by investors in isolation or as alternatives to cost of sales, net
profit/(loss) attributable to equity owners of the parent, profit/(loss) before
tax and other items or any other measure of financial performance presented in
accordance with IFRS or as an indicator of our performance. While the World
Gold Council has provided guidance for the calculation of cash operating costs,
cash operating costs per kilogram, all-in sustaining costs and all-in costs per
kilogram, such measurements may vary significantly among gold mining companies,
and these definitions by themselves do not necessarily provide a basis for
comparison with other gold mining companies. However, we believe that these
measures are useful indicators to investors and our management of an individual
mine's performance and of the performance of our operations as a whole as they
provide: ·an
indication of a mine’s profitability and efficiency; ·the
trend in costs; ·a
measure of margin per kilogram, by comparison of the cash operating costs per
kilogram to the price of gold; and ·a
benchmark of performance to allow for comparison against other mines and mining
companies.  For
fiscal year 2019, cash operating costs per kilogram increased by 9% to R499,749
per kilogram from R499,749 per kilogram in fiscal year 2018. All-in sustaining
costs per kilogram increased by 4% to R524,713 per kilogram in fiscal 2019 from
R505,622 per kilogram in fiscal year 2018. All-in costs per kilogram increased by
15% to R600,941 per kilogram of gold in fiscal 2019 from R524,651 per kilogram
of gold in fiscal year 2018.Thedecrease in gold production at Ergoresulted in an increase
in cash operating costs per kilogram, all-in sustaining costs per kilogramandall-in costs per kilogramwhich wasmoderated by the lowercash operating costs per kilogram and all-in sustaining
costs per kilogramof FWGR. Non-sustaining
capital expenditure incurred in the development of FWGR Phase 1 resulted in an
increase in the all-in costs per kilogram of the Group.  45


---

R millions
 2019
 2018Reconciliation of cash operating costs, cash operating costs per
  kilogram, all-in sustaining costs, all-in sustaining costs per kilogram,
  all-in costs and all-in costs per kilogramCost of sales
 2,553.9
 2,347.7Depreciation
 (169.1)
 (168.0)Retrenchment costs
 (6.3)
 -Change in estimate of environmental rehabilitation
 60.0
 2.9Movement in gold in process
 32.6
 24.5Operating costs
 2,471.1
 2,207.1Ongoing rehabilitation expenditure
 (18.3)
 (26.7)Care and maintenance costs
 (8.8)
 (8.2)Other operating costs
 (21.1)
 (12.5)Cash operating costs1)
 2,422.9
 2,159.7Movement in gold in process
 (32.6)
 (24.5)Administration expenses and other costs excluding non-recurring
  items1
 69.5
 81.1Other operating costs
 21.1
 12.5Change in estimate of environmental rehabilitation
 (60.0)
 (2.9)Unwinding of rehabilitation provision
 66.3
 45.6Sustaining capital expenditure1
 22.5
 81.3All-in sustaining costs 1
 2,509.7
 2,352.8Retrenchment costs
 6.3
 -Care and maintenance costs
 8.8
 8.1Ongoing rehabilitation expenditure
 18.3
 26.7Capital recoupment
 -
 -Transaction costs incurred related to the acquisition of FWGR
 -
 9.0Growth capital expenditure1
 331.2
 44.7All-in costs1
 2,874.3
 2,441.3Gold produced (kilograms)
 4,826
 4,679Cash operating costs per kilogram (R per kilogram)
 499,749
 458,866All-in sustaining costs per kilogram (R per kilogram)
 524,733
 505,622All-in costs per kilogram (R per kilogram)
 600,941
 524,651Reconciliation of sustaining capital expenditure and growth
  capital expenditureTotal capital expenditure/additions to property, plant and
  equipment
 353.8
 126.1Growth capital expenditure1
 331.2
 44.7Sustaining capital expenditure1
 22.5
 81.31See Glossary of Terms for
  definitions.
 46


---

Cash operating
costs  Cash
operating costs are linked directly to the level of throughput of a specific
fiscal year.  The following table illustrates the year-on-year change in
cash operating costs for fiscal year 2019 in comparison with fiscal year 2018.  R
  million
 Cash operating costs
 Impact of change in throughput
 Impact of change in costs
 Net change
 Cash operating costs2018
 2019Ergo
 2,159.7
 (99.5)
 250.9
 151.4
 2,311.1FWGR
 -
 111.8
 -
 111.8
 111.8Total
 2,159.7
 12.3
 250.9
 263.2
 2,422.9
  Cash
operating costs in fiscal year 2019 increased by R263.2 million to R2,422.9
million compared to cash operating costs of R2,159.7 million in fiscal year
2018.
This
is mainly due to inflationary increases, increase trucking costs for sand
material treated at the Ergo plant as well as the inclusion of cash operating
costs of FWGR of R111.8 million.   The following table lists the major components of cash operating
  costs for the Group for each operation and fiscal year set forth below
  respectively:Ergo
 
 
 FWGRYears ended June 30,
 
 
 Year ended1Costs
 2019
 2018
 
 Costs
 2019
 2018Consumables
 35%
 36%
 
 Consumables
 38%
 -Electricity
  and water
 20%
 19%
 
 Labor
 31%
 -Labor
 18%
 19%
 
 Specialized
  service providers
 14%
 -Specialized
  service providers
 16%
 16%
 
 Electricity
  and water
 13%
 -Other
  costs
 11%
 10%
 
 Other
  costs
 5%
 -1 After date of commercial production of Phase 1 of Aril 1, 2019
 47


---

5B. LIQUIDITY AND CAPITAL RESOURCES  Cash
flows from operating activities  Cash
generated from operating activities amounted to R288.3 million for fiscal
year 2019 (fiscal year 2018: R233.8 million and fiscal year 2017: R51.6
million).  Cash
generated from operating activities increased during fiscal year 2019 mostly dueto
gold sold thatincreased by 3% as well as
the average rand gold price received having increased by 8% to R577,483 per
kilogram. In addition, the net movement in working capital  increase by R73.7
million in fiscal year 2019 compared to a increase in cash of R14.6 million in
fiscal year 2018.  Cash
flows from investing activities  Net cash utilized by investing activities amounted to R303.0 million
in fiscal year 2019 compared to R140.4 million in fiscal year 2018 and R96.7 million
in fiscal year 2017.  In fiscal year 2019, net cash utilized by investing activities
consisted mainly of R347.4 million in additions to property, plant and
equipment and R16.6 million spent on environmental rehabilitation payments.
These outflows were reduced by R55.2 million cash received from rehabilitation
obligation funds and R5.8 million proceeds on the disposal of property, plant
and equipment.  Additions
to property, plant and equipmentin fiscal
year 2019 consisted mainly of R330.7 million incurred FWGR and included R323.8
million incurred on the development of Phase 1 of FWGR.  In fiscal year 2018, net cash utilized by investing
activities consisted mainly of R125.9 million in additions to property, plant
and equipment and R21.5 million spent on environmental rehabilitation payments.
These outflows were reduced by R7.0 million proceeds on the disposal of
property, plant and equipment.  Additions
to property, plant and equipmentin fiscal
year 2018were predominantly on Ore Reserve development, new
infrastructure and new mining equipment at our operations. Significant capital
projects for Ergo during fiscal year 2018 included: ☐R41.3
million spent on the installation of two ball mills at Ergo in order to process
higher grade sand at better margins (these mills were reclaimed from the
company’s now decommissioned Crown plant), ☐R24.3
million spent on the ramp-up of reclamation from the 4L50 slimes dam, which is
the southern portion of the Elsburg Tailings Complex, bordering Boksburg and
Germiston; ☐R14.4
million spent on conversion of the Ergo plant’s electro-winning circuit to zinc
precipitation; and ☐R17.8
million on building a new lodge to support training services rendered by EBDA.  Cash flows from financing activities  Net cash outflow fromfinancing activities was R7.9 million in fiscal year 2019 compared to R45.0 million
in fiscal year 2018 and R53.0 million in fiscal year 2017.  During fiscal year 2019, the net cash outflow consisted
mostly of borrowings raised and subsequently repaid of R192.0 million.  During fiscal year 2018, the net cash outflow consisted
mostly of a dividend payment of R42.2 million.  Cash
and cash equivalents  Cash
and cash equivalents as at June 30, 2019 amounted
to R279.5 million compared to R302.1 million at the end of fiscal year 2018.
Substantially all of our cash and cash equivalent balances were denominated in
South African rand.  Cash
and cash equivalents as at June 30, 2019 includes
restricted cashin the form of cash held in escrow amounting toR0.0million at the end of
fiscal year2019compared toR114.2million at the end of
fiscal year2018related to an electricity tariff dispute with Ekurhuleni
(refer to Item 4D. Ongoing legal proceedings). Restricted cash at June 30, 2019
also includes guaranteesof R18.3 million
compared to R17.2 million at the end of fiscal year 2018.  At
September 30,2019, our cash and cash
equivalents were R333.6 million.  Borrowings
and funding  Our available external sources of capital includeaR300 million Revolving Credit Facility describedin Item 10C. Material Contracts –
ZAR 300 million Revolving Credit Facility. R125.0 million of thisRevolving Credit Facility has been committed to the guarantee
issued to Ekurhuleni as described in Item 10C. Material
Contracts, resulting in R175.0 million being uncommitted and available to
the Company. No amounts were drawn under this facility as of June 30, 2019 or
September 30, 2019  Anticipated funding requirements and sources  Existing
operations 48


---

Our cash and cash equivalents are set out above
under “Cash and cash equivalents”. Our management believes that existing cash
resources, net cash generated from operations and the availability of
negotiated funding facilities will be sufficient to meet the anticipated
commitments of our existing operations for fiscal year 2020.  5C. RESEARCH AND DEVELOPMENT, PATENTS AND LICENSES, ETC.  DRDGOLD has a
dedicated team that looks at ways and means of improving recoveries. While the
team remains active with an ongoing focus on improving extraction efficiencies,
the projects undertaken during the year ended June 30, 2019 were focused on
optimizing the existing facilities rather than implementing new technologies to
improve extraction efficiencies. We have no registered patents or licenses.  5D. TREND INFORMATION  For the fiscal year 2020, we are planning Group gold
production of 175,000 to 190,000 ounces at cash operating costs of
approximately R490,000 per kilogram. Our ability to meet the full year’s
production target could be impacted by lower grades, failure to achieve the
targets set at Ergo and FWGR, power interruptions and other risks (refer Item
3D. Risk Factors—Risks related to our business and operations and“–Forward Looking
Statements”). We are also subject to cost pressures in the event of
above inflation increases in labor, electricity and water; crude oil and steel
costs. Unforeseen changes in ore grades and recoveries, unexpected changes in
the quality or quantity of reserves and resource, technical production issues,
environmental and industrial accidents, gold theft, environmental factors and
pollution could adversely impact the production, sales and cash operating costs
for fiscal year 2020 and cause us to fail to meet our
targets for the year.  Our
acquisition of WRTRP assets from Sibanye-Stillwater will impact our results
going forward and we remain subject to risks associated with acquired assets
(refer Item 3D. Risk Factors—Risks related to our business and operations).  Refer
toItem
5A.: “Key drivers of our operating results and principal factors affecting our
operating results”for a discussion of the
trend in the US Dollar gold price as well as the exchange rate impacting our
business.  Operating
results for the quarter ended September 30, 2019  Quarter ended
 Quarter ended30-Sep-19
 30-Jun-19
 % changeProductionGold produced
 
 kg
 1,493
 1,418
 5%oz
 48,001
 45,590
 5%Gold sold
 
 kg
 1,510
 1,429
 6%oz
 48,547
 45,943
 6%Ore milled
 
 Metric (000't)
 7,155
 6,853
 4%Yield
 
 Metric (g/t)
 0.209
 0.207
 1%
 Price and costsAverage gold price received
 
 R per kg
 696,368
 603,755
 15%US$ per oz
 1,475
 1,307
 13%Cash operating costs
 
 R/t
 97
 99
 -2%US$/t
 7
 7
 -Cash operating costs
 
 R per kg
 459,868
 475,657
 -3%US$ per oz
 974
 1,030
 -5%All-in sustaining costs **
 
 R per kg
 517,219 1
 466,927
 11%US$ per oz
 1,096 1
 1,011
 8%All-in cost **
 
 R per kg
 528,344 1
 484,315
 9%US$ per oz
 1,155 1
 1,082
 7%1 All-in sustaining cost per kg and all-in cost per kg were
  disproportionately impacted by including a R41.1 million increase in the liability
  for the long-term incentive scheme while including gold production/sold for
  the first quarter only
 Capital expenditureSustaining
 
 Rm
 5.5
 5.9
 -7%US$m
 0.4
 0.4
 -Non-sustaining/growth
 
 Rm
 11.2
 13.7
 -18%US$m
 0.8
 1.0
 -20%Average R/US$ exchange rate
 
 
 14.68
 14.37
 2%
 49


---

Rounding of figures may
result in computational discrepancies *The adjusted earnings
before interest, taxes, depreciation and amortisation ("Adjusted EBITDA")
(that was considered from the quarter ended 30 June 2019 following the
implementation of the Revolving Credit Facility agreement) may not be
comparable to similarly titled measures of other companies. Adjusted EBITDA is
not a measure of performance under International Financial Reporting Standards
(“IFRS”) and should be considered in addition to, and not as a
substitute for, other measures of financial performance and liquidity.  **All-in cost
definitions based on the guidance note on non-GAAP Metrics issued by the World
Gold Council on 27 June 2013.  Gold
production increased by 5% quarter on quarter primarily due to a 4% increase in
tonnage throughput as Far West Gold Recoveries Proprietary Limited achieved the
planned throughput of 500 000tpm from Phase 1 during the quarter and
successfully started operating its mills at the beginning of September 2019.
This resulted in a 3% and 2% decrease in cash operating cost per kilogram of
gold sold and cash operating cost per ton of material processed respectively,
compared to the previous quarter.  Overall
yield increased by 1% compared to the previous quarter due mostly to improved
head grade at Ergo Mining Proprietary Limited.  Adjusted
EBITDA more than doubled for the quarter, due mainly to the 15% increase in
gold price received and a 6% increase in gold sold.  All-in
sustaining costs per kilogram and all-in costs per kilogram for the quarter
were 11% and 9% higher respectively, due to the positive impact of the change
in estimate of environmental rehabilitation recognised in profit or loss,
lowering the respective unit costs from the previous quarter.  Cash
and cash equivalents increased to R333.6 million as at 30 September 2019 (30
June 2019: R279.5 million) after paying a cash dividend of R136.4 million
(declared for the year ended 30 June 2019) and increasing working capital
lockup by R133.9 million for the quarter. External borrowings remained at Rnil
as at 30 September 2019 (30 June 2019: Rnil). The board of directors of the
Company (“Board”) will consider the payment of a dividend once the half
year results have been finalised.  5E.
OFF-BALANCE SHEET ARRANGEMENTS  The
Company does not engage in off-balance sheet financing activities, and does not
have any off-balance sheet debt obligations, unconsolidated special purposes
entities or unconsolidated affiliates.  5F. TABULAR DISCLOSURE OF CONTRACTUAL OBLIGATIONSEstimated and actual payments due by periodTotal
 Less than
 Between
 Between
 More than 5 years1 year
 1-3 years
 3-5 yearsR m
 R m
 R m
 R m
 R mProvision
  for environmental rehabilitation (2)
 682.6
 56.7
 120.8
 106.3
 398.8Finance
  leases
 11.0
 11.0
 -
 -
 -Trade
  and other payables
 419.2
 419.2
 -
 -
 -Purchase
  obligations – contracted capital expenditure (1)
 18.6
 18.6
 -
 -
 -Other
  contractual obligations
 6.2
 2.5
 3.7
 -
 -Total
  contractual and cash obligations
 1,137.6
 508.0
 124.5
 106.3
 398.8(1)Represents planned capital
  expenditure for which contractual obligations exist.(2)Gold mining companies are subject to extensive environmental
  regulations in the various jurisdictions in which they operate. These
  regulations establish certain conditions on the conduct of our operations.
  Pursuant to environmental regulations, we are also obliged to close our
  operations and reclaim and rehabilitate the lands upon which we have
  conducted our mining and gold recovery operations. The estimated closure
  costs at existing operating mines and mines in various stages of closure are
  reflected in this table. For more information on environmental rehabilitation
  obligations, see Item 4D. “Property, Plant and Equipment” and Note 11 -
  “Provision for environmental rehabilitation” under Item 18. “Financial
  Statements".
   5G.          SAFE HARBOR  See Special Note
Regarding Forward-Looking Statements.  ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES  6A. DIRECTORS AND SENIOR MANAGEMENT  Directors
and Executive Officers  Our
board of directors may consist of not less than four and not more than twenty
directors. As of June 30, 2019, our board consisted of eight directors.  50


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In accordance with JSE listing
requirements and our Memorandum of Incorporation, or MOI, one third of the
directors comprising the board of directors, on a rotating basis, are subject
to re-election at each annual general shareholders’ meeting. Additionally, all
directors are subject to election at the first annual general meeting following
their appointment. Retiring directors normally make themselves available for
re-election.  In
accordance with the provisions of the agreement for the acquisition of the
WRTRP Assets,JeanJohannes Nel was
appointedas an independent, non-executive
director of the Boardat the annual general meeting of 30 November 2018.  Kuby
Prudence Lebina wasappointed as independent non-executive director on 03 May 2019.  James
Turk’s appointment as independent, non-executive director terminated on 31
October 2018; on which date he ceased to be a director of DRDGOLD.  The address of each of our Executive Directors and
Non-Executive Directors is the address of our principal executive offices.  Executive Directors Daniël (Niel) Johannes Pretorius (52)Chief Executive Officer. Niël Pretorius has two decades
of experience in the mining industry. He was appointed Chief Executive Officer
designate of DRDGOLD on August 21, 2008 and Chief Executive Officer on January
1, 2009. Having joined the company on May 1, 2003 as legal advisor, he was
promoted to Group Legal Counsel on September 1, 2004 and General Manager:
Corporate Services on April 1, 2005. Niël was appointed Chief Executive Officer
of Ergo Mining Operations Proprietary Limited (formerly DRDGOLD SA) on July 1,
2006 and became Managing Director thereof on April 1, 2008.Niel is a member of the Social & Ethics Committee of
DRDGOLD.  Adriaan
(Riaan) Jacobus Davel (43)Chief Financial Officer.Riaan
Davel joined DRDGOLD in January 2015. Before joining DRDGOLD, he gained 17
years’ experience in the professional services industry, the majority obtained
in the mining industry in Africa. As part of gaining that experience, Riaan
provided assurance and advisory services, including support and training on
IFRS to clients and teams across the African continent. He has spent seven
years at KPMG as an audit partner, performing,inter alia, audits of
listed companies in the mining industry, including SEC registrants. Riaan has
also gained experience as an IFRS technical partner and represented the South
African Institute of Chartered Accountants on the International Accounting Standards
Board’s project on extractive activities from 2003 to 2010. Riaan has served on
committees that compile/update the South African codes for reporting and
valuation of mineral reserves and resources.  Non-Executive Directors Geoffrey
Charles Campbell (58).Geoffrey Campbell
was appointed a Non-executive Director in 2002, a senior independent
non-executive director in December 2003 and Non-executive Chairman in October
2005. A qualified geologist, he has worked on gold mines in Wales and Canada.
He spent 15 years as a stockbroker before becoming a fund manager, managing the
Merrill Lynch Investment Managers Gold and General Fund, one of the largest
gold mining investment funds. He was also research director for Merrill Lynch
Investment Managers. Geoffrey is a director of Oxford Abstracts Limited. Geoffrey
chairs the Nominations component of the Remuneration & Nominations
Committee of DRDGOLD.  Edmund
Abel Jeneker (57).Edmund Jeneker was appointed Non-executive
Director in November 2007 and Lead Independent Non-executive Director in August
2017. He has more than 30 years’ experience as an executive in banking,
business strategy, advisory and management at Grant Thornton South Africa
Proprietary Limited, Swiss Re Corporate Solutions Advisors South Africa Proprietary
Limited, the World Bank Competitiveness Fund and Deloitte South Africa. More
recently, he completed almost 14 years at Absa Bank and Barclays Africa Group,
where he was managing executive and served as director on the boards of several
subsidiaries in the Barclays Africa Group. Edmund is active in community social
upliftment and served as a member of the Provincial Development Commission of
the Western Cape Provincial Government. He currently serves on the Advisory
Board of the Institute of Directors Southern Africa, Investment Committee of
BADISA and The Cape Philharmonic Orchestra. He is a Chartered Director. Edmund
chairs the Social & Ethics Committee and is a member of the Remuneration
& Nominations Committee of the Company.  Johan
Andries Holtzhausen(73).Johan Holtzhausen was appointed
independent Non-executive Director in on April 25, 2014. He has more than 42
years’ experience in the accounting profession, having served as a senior
partner at KPMG Services Proprietary Limited, and held the highest Generally
Accepted Accounting Principles (United States), Generally Accepted Auditing
Standards and Sarbanes-Oxley Act accreditation required to service clients
listed on stock exchanges in the United States. His clients included major
corporations listed in South Africa, Canada, the United Kingdom, Australia and
the United States. Johan currently serves as a voluntary independent director
and chairman of the Audit and Risk Committee of the Tourism Enterprise
Partnership. He also chairs the Audit and Risk Committee of Tshipi é Ntle
Manganese Mining Proprietary Limited. He is a Non-executive Director of
Caledonia Mining Corporation Plc, a Canadian corporation listed in the United States,
Canada and the United Kingdom, and he chairs its Audit and Risk Committee.  JeanJohannesNel
(47). Jean Nel was appointed as an independent Non-executive Director on
November 30, 2018. He qualified as a CA(SA) in 1998 obtained the CFA (AIMR)
qualification. Mr. Nel has 20 years of mining finance and mining executive and
operational management experience. He was appointed to the Aquarius Platinum
Board in April 2012 and became CEO of the Group in November 2012, a position he
held until Aquarius Platinum was acquired by Sibanye- Stillwater in April 2016.
From April 2016 to January 2017 he was the CEO of the Platinum division of
Sibanye Stillwater. He is currently a non-executive director of Mimosa
Investments which owns the Mimosa platinum mine in Zimbabwe and Northam
Platinum. Jean is
a member of the Audit & Risk Committee of DRDGOLD.  Toko
Victoria Buyiswa Nomalanga Mnyango(53). Toko Mnyango was appointed
independent Non-executive Director on December 51


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1, 2016.
Toko began her career as a prosecutor for the KaNgwane homeland, before
becoming a legal advisor for the Eastern Cape Development Corporation. She has
held directorships on company boards including Gijima, EOH Mthombo Proprietary
Limited, AllPay Eastern Cape Proprietary Limited, a subsidiary of ABSA Limited,
and the Ryk Neethling Foundation. She currently holds the position of CEO of
Vitom Technologies Proprietary Limited and Vitom Brands Communication
Proprietary Limited. Toko chairs the Remuneration component of the Remuneration
& Nominations Committee as is a member of the Social & Ethics Committee
of DRDGOLD.  Kuby Prudence Lebina(38).Prudence Lebina was appointed as independent
non-executive director on 03 May 2019.She qualified
as a chartered accountant in December 2005 after serving her articles at
PricewaterhouseCoopers Incorporated. A member of the South African Institute of
Chartered Accountants, with extensive experience in corporate finance and
investor relations in investment banking and the mining industry, she is
currently Chief Executive Officer of GAIA Infrastructure Capital Limited. She
is a member of the Audit & Risk Committee as well as the Remuneration &
Nominations Committee.  Senior
Management and Prescribed Officers  Wilhelm
Jacobus Schoeman (45)(Dip Analytical
Chemistry, BTech Analytical Chemistry). Jaco Schoeman joined DRDGOLD
in 2011 as Executive Officer: Business Development to focus on expanding the
Group’s surface retreatment business and extracting maximum value from existing
resources. In July 2014, he was appointed Operations Director: Ergo Mining
Operations Proprietary Limited.  Henry Gouws (50)(National Higher Diploma (Extraction Metallurgy), MDP) Managing
Director: Ergo. Henry Gouws has 30 years’ experience in the mining industry. He
graduated from Technikon Witwatersrand and obtained a National Diploma in
Extraction Metallurgy in 1990 and a National Higher Diploma in Extraction
Metallurgy in 1991. He completed a Management Development Program in 2003
through Unisa School of Business Leadership and an Executive Development
Programme in 2012 through the University of Stellenbosch Business School. He
was appointed Operations Manager of Crown in January 2006 and General Manager
in July 2006. He was appointed to his current position in October 1, 2011.  Mark Burrell (57)(BCom Accounting, MDP) Financial Director: Ergo. Mark Burrell holds a BComm
Accounting degree and has completed a Management Development Programme (MDP)
and has twenty years’ experience in the mining sector. He joined DRDGOLD in
2004 on a consulting basis and later that year, was appointed as Financial Manager
of the Blyvooruitzicht operation. He was appointed as Financial Director of
Ergo in January 2012. Mark serves as a director on the Board of Rand Refinery
Proprietary Limited.  Reneiloe
Masemene (38)(LLB, LLM). Reneiloe
Masemene, a qualified attorney, joined DRDGOLD in January 2009 as a legal
advisor. She was appointed to the position of Senior Legal Advisor in October
2011 and Prescribed Officer of Ergo Mining Proprietary Limited in June 2012.
She was appointed to the position of Group Legal Counsel in August 2014 and
Company Secretary in March 2016. She has significant experience in all areas of
mining law, as well as in the corporate, commercial, contractual, employment
and litigious aspects related to mining.Sheceased to be an employee and company secretary of the company with effect
from September 30, 2019.  Kevin
Kruger (51)(BscEng (Mechanical Engineering), MDP, PMD, Government
Certificate of Competency (Mines)). Kevin has 32 years’ experience in the
mining industry in Africa. He joined the mining industry in January 1987 as
second year engineering student. Kevin graduated from the University of the
Witwatersrand at the end of 1989 obtaining his BSc (Mechanical Engineering) and
his government certificate of Competency (mines) during 1993. Kevin was
appointed as junior engineer in December 1989, section engineer - March 1994
and engineer in September 1994. He was appointed engineering manager 2003,
general manager – technical services 2004 and managing director Chizimgold
2010. On 01 October 2013 he was appointed as technical director at Ergo where
he was responsible for the environmental, health and safety, mineral resources
and engineering portfolios. On 1 August 2018, Kevin was appointed Managing
Director of FWGR.  Henriette
Hooijer (39)(BCom (Hons), CA(SA)). Henriette
Hooijer is the Financial Director of FWGR. She joined DRDGOLD in May 2016 and
was appointed as Financial Director of FWGR in August 2018. Before joining
DRDGOLD, she spent 11 years’ in the professional services industry at KPMG,
performing, inter alia, audits of listed companies in the mining industry,
including SEC registrants.  Elise
Beukes (42)(BProc). Elise Beukes was appointed as Company Secretary
of DRDGOLD with effect from October 01, 2019. She has broad governance
experience in all aspects of commercial law, having spent several years in both
litigation and commercial practice as an admitted attorney and four years as
corporate legal counsel. She has dealt extensively with broad-based black
economic empowerment structures, employee ownership schemes, enterprise
development and share incentive schemes involving complex company restructuring
for both multi-nationals and large local entities. She has extensive knowledge
on the new Companies Act and has particular interests in company secretarial
and corporate governance matters.  There are no family relationships between any of our
non-executive directors, executive directors or members of the group executive
and senior management. There are no arrangements or understandings between any
of our directors or executive officers and any other person by which any of our
directors or executive officers has been so elected or appointed. Furthermore,
none of the non-executive directors, executive directors, group executive and
senior management members or other key management personnel are elected or
appointed under any undertaking by, arrangement or understanding with any major
shareholder, customer, supplier or otherwise.  6B. COMPENSATION Our MOI provide that
the directors' fees should be determined from time to time in a general meeting
or by a quorum of Non-Executive Directors. The total amount of directors'
remuneration paid and or accrued for the year ended June 30, 2019 was R24.8
million.  Non-Executive
Directors received the following fees for fiscal year 2019:  52


---

·Base fee as Non-Executive Chairman of R1,388,518 per
annum; ·Base fee as Lead Independent Non-Executive Director of R640,261
per annum; ·Base fee as Non-Executive Directors of R617,119 per
annum; ·Annual fee for Audit and Risk Committee Chairman of R30,856
(excluding fee received as a committee member); ·Annual fee for Audit and Risk Committee member of R30,856; ·Annual fee for the chairman of Remuneration and
Nominations Committee and Social and Ethics Committee of R23,142 (excluding fee
received as a committee member); ·Annual fee for members of Remuneration Committee and
Social and Ethics Committee of R23,142 each; ·Daily fee of R23,142; ·Hourly rate of R3,086; ·Half-day fee for participating by telephone in special
board meetings of R11,571; and ·The Chairman of the board, Lead Independent Non-Executive
Director and other Non-Executive Directors to receive committee fees.  The following table sets forth the compensation for our
  directors and prescribed officers for the year ended June 30, 2019.The disclosure detailed in this table is consistent with the
  disclosure requirements of the Companies Act, 2008 (Act 71 of 2008) and the
  JSE Listings Requirements.Directors / Prescribed Officer
 Total remuneration recognised during the year
 Short Term Incentives recognised related to this cycle
 Long term Incentives paid during this cycle
 Total remuneration related to this cycleR'000
 R'000
 R'000
 R'000Executive directorsD J Pretorius
 6,481
 4,668
 1,777
 12,926A J Davel
 3,669
 2,622
 998
 7,28910,150
 7,290
 2,775
 20,215Non-executive directorsG C Campbell
 1,514
 -
 -
 1,514J Turk
 280
 -
 -
 280E A Jeneker
 916
 -
 -
 916J Holtzhausen
 702
 -
 -
 702T B V N Mnyango
 690
 -
 -
 690J J Nel
 377
 -
 -
 377P Lebina
 104
 -
 -
 1044,583
 -
 -
 4,583Prescribed officers (1)W J Schoeman
 3,479
 2,565
 998
 7,042R Masemene
 2,478
 1,186
 609
 4,2735,957
 3,751
 1,607
 11,315Total
 20,690
 11,041
 4,382
 36,113(1)The Companies Act, 2008 (Act 71 of 2008), under section 30,
  requires the remuneration of prescribed officers, as defined in regulation 38
  of Company Regulations 2008, to be disclosed with that of directors of the
  company. A person is a prescribed officer if they have general executive
  authority over the company, general responsibility for the financial
  management or management of legal affairs, general managerial authority over
  the operations of the company or directly or indirectly exercise or significantly
  influence the exercise of control over the general management and
  administration of the whole or a significant portion of the business and
  activities of the company.See also Item 6E. Share Ownership for details of share options
  held by directors.
 Compensation of key management  Refer toItem 18. ‘‘Financial Statements – Note 19.2
– Related party transactions’’ for the total compensation paid to key
management (including executive and non-executive directors as well as
prescribed officers). 53


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Short
term incentives in respect of Executive Directors are paid based upon
performance against predetermined key performance indicators. Should an
Executive Director meet all the targets set in terms of such predetermined key
performance indicators, he will be entitled to a short term incentive of up to
100% of his remuneration package, depending on his particular agreement. Should
an Executive Director not meet all the targets set in terms of the
predetermined key performance indicators, he will be entitled to a lesser bonus
as determined at the discretion of the Remuneration Committee.  Service
Agreements  Service
contracts negotiated with each executive and non-executive director incorporate
their terms and conditions of employment and are approved by our Remuneration
Committee.  The
Company’s current executive directors, Mr. D.J. Pretorius and Mr. A.J. Davel,
entered into agreements of employment with us, on January 1, 2009 and January
1, 2015, respectively. These agreements regulated the employment relationship
with Messrs. D.J. Pretorius and A.J. Davel during the year ended June 30, 2019.  On July
1, 2019 Mr. D.J. Pretorius entered into a new agreement of employment for a
period of 3 years and thereafter it continues indefinitely until terminated by
either party on not less than three months’ written notice. Under the
employment agreement effective up to June 30, 2018 Mr. D.J. Pretorius receives
from us a guaranteed remuneration package of R6.2 million per annum.
Mr. D.J. Pretorius was eligible under his employment agreement, for an
incentive bonus of up to 100% of his annual remuneration package in respect of
one bonus cycle per annum over the duration of his appointment, on the condition
that DRDGOLD achieves certain key performance indicators. In addition, he is
eligible to participate in the long term incentive scheme and was awarded
2,323,009 phantom shares in November 2015.  Mr. A.J.
Davel entered into a new employment agreement effective from July 1, 2019 for a
period of 3 years and thereafter it continues indefinitely until terminated by
either party on not less than three months’ prior written notice. Mr. A.J.
Davel receives from us a guaranteed remuneration package of R3.4 million per
annum. Mr. A.J. Davel is eligible under his employment agreement, for a
short term incentive of up to 100% of his annual remuneration package in
respect of one bonus cycle per annum over the duration of his appointment, on the
condition that DRDGOLD achieves certain key performance indicators. He is
eligible to participate in the long term incentive scheme. He was issued
205,207 phantom shares under the long term incentive scheme on his joining
DRDGOLD and 1,305,033 phantom shares in November 2015.  Messrs.
G.C. Campbell and E.A. Jeneker each have service agreements which run for fixed
periods until October 31, 2019. Mr. J Turk service as director terminated on
October 31, 2018. Mr. J.A Holtzhausen has a service agreement which runs for a
fixed period until April 25, 2020.Mrs. TVBN Mnyangohas a service agreement which runs until November
30, 2020. Mr. J Nel entered into a service agreement which runs for a fixed
period until November 30, 2020 and Ms. K.P Lebina entered into a service
agreement which runs until May 02, 2021. After expiration of the initial two
year periods, the agreements continue indefinitely until terminated by either
party on not less than three months’ prior written notice.  The Company does not administer any pension, retirement
or other similar scheme in which the directors receive a benefit.  Each
service agreement with our directors provides for the provision of benefits to
the director where the agreement is terminated by us in the case of our
executive officers, except where terminated as a result of certain action on
the part of the director, upon the director reaching a certain age, or by the
director upon the occurrence of a change of control. A termination of a
director's employment upon the occurrence of a change of control is referred to
as an “eligible termination.” Upon an eligible termination, the director is
entitled to receive a payment equal to at least one year's salary or fees, but
not more than three years' salary for Executive Directors or two years’ fees
for Non-Executive Directors, depending on the period of time that the director
has been employed.  6C. BOARD PRACTICES  Board of Directors  As at June 30, 2019 and September
30, 2019, the board of directors comprises two Executive Directors
(Mr. D.J. Pretorius and Mr. A.J. Davel), and six Non-Executive
Directors (Messrs. G.C. Campbell, J.J. Nel, E.A. Jeneker, J.A.
Holtzhausen and Mmes. K.P. Lebina and TVBN Mnyango). The Non-Executive Directors
are independent under the New York Stock Exchange, or NYSE, requirements (as
affirmatively determined by the Board of Directors) and the South African King
IV Report.  In
accordance with the King IV Report on corporate governance, as encompassed in
the JSE Listings Requirements, and in accordance with the United Kingdom
Combined Code, the responsibilities of Chairman and Chief Executive Officer are
separate. Mr. G.C. Campbell is the Non-Executive Chairman, Mr. D.J. Pretorius
is the Chief Executive Officer and Mr. A.J Davel is the Chief Financial
Officer. The board has established a Remuneration and Nominations committee,
and it is our policy for details of a prospective candidate to be distributed
to all directors for formal consideration at a full meeting of the board. A
prospective candidate would be invited to attend a meeting and be interviewed
before any decision is taken. In compliance with the NYSE rules a majority of
independent directors will select or recommend director nominees.  The board’s
main roles are to create value for shareholders, to provide leadership of the
Company, to approve the Company’s strategic objectives and to ensure that the
necessary financial and other resources are made available to management to
enable them to meet those objectives. The board retains full and effective
control over the Company, meeting on a quarterly basis with additional ad hoc
meetings being 54


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arranged when necessary, to review
strategy and planning and operational and financial performance. The board
further authorizes acquisitions and disposals, major capital expenditure,
stakeholder communication and other material matters reserved for its
consideration and decision under its terms of reference. The board also
approves the annual budgets for the various operational units.  The
board is responsible for monitoring the activities of executive management
within the company and ensuring that decisions on material matters are referred
to the board. The board approves all the terms of reference for the various
subcommittees of the board, including special committees tasked to deal with
specific issues. Only the executive directors are involved with the day-to-day
management of the Company.  To
assist new directors, an induction program has been established by the Company,
which includes background materials, meetings with senior management,
presentations by the Company’s advisors and site visits. The directors are
assessed annually, both individually and as a board, as part of an evaluation
process, which is driven by an independent consultant. In addition, the
Remuneration and Nominations Committees formally evaluate the executive
directors on an annual basis, based on objective criteria.  All
directors, in accordance with the Company’s MOI, are subject to retirement by
rotation and re-election by shareholders. In addition, all directors are
subject to election by shareholders at the first annual general meeting
following their appointment by directors. The appointment of new directors is
approved by the board as a whole. The names of the directors submitted for
re-election are accompanied by sufficient biographical details in the notice of
the forthcoming annual general meeting to enable shareholders to make an
informed decision in respect of their re-election.  All
directors have access to the advice and services of the Company Secretary, who
is responsible to the board for ensuring compliance with procedures and
regulations of a statutory nature. Directors are entitled to seek independent
professional advice concerning the affairs of the Company at the Company’s
expense, should they believe that course of action would be in the best
interest of the Company.  Board
meetings are held quarterly in South Africa and abroad. The structure and
timing of the Company’s board meetings, which are scheduled over two days,
allows adequate time for the Non-Executive Directors to interact without the
presence of the Executive Directors. The board meetings include the meeting of
the Audit & Risk Committee, Remuneration & Nominations Committee as
well as Social & Ethics Committee which act as subcommittees to the board.
Each subcommittee is chaired by one of the Independent Non-Executive Directors,
each of whom provides a formal report back to the board. Each subcommittee
meets for approximately half a day. Certain senior personnel of the Company
attend the subcommittee meetings as invitees.  The
board sets the standards and values of the Company and much of this has been
embodied in the Company’s Code of Conduct, which is available on our website at
www.drdgold.com. The Code of Conduct applies to all directors, officers and
employees, including the principal executive, financial and accounting
officers, in accordance with Section 406 of the US Sarbanes-Oxley Act of 2002,
the related US securities laws and the NYSE rules. The Code contains provisions
for employees to report violations of Company policy or any applicable law,
rule or regulation, including US securities laws.  A
description of the significant ways in which our corporate governance practices
differ from practices followed by U.S. companies listed on the NYSE can be
found in Item 16G. Corporate Governance.  Directors'
Terms of Service  The
following table shows the date of appointment, expiration of term and number of
years of service with us of each of the directors as at June 30, 2019:  Director
 Title
 Year firstappointed
 Term of currentoffice
 Unexpired term ofcurrentofficeD.J.
  Pretorius
 Chief Executive Officer
 2008
 3 years
 0 monthsA.J. Davel
 Chief Financial Officer
 2015
 3 years
 0 monthsG.C.
  Campbell
 Non-Executive Director
 2002
 2 years
 4 monthsE.A.
  Jeneker
 Non-Executive Director
 2007
 2 years
 4 monthsJ.
  Turk1
 Non-Executive Director
 2004
 1 year
 0 monthsJ.
  Holtzhausen
 Non-Executive Director
 2014
 2 years
 10 monthsT.V.B.N.
  Mnyango
 Non-Executive Director
 2016
 2 years
 17 monthsJ.J
  Nel
 Non-Executive Director
 2018
 2 years
 17 monthsK.P
  Lebina
 Non-Executive Director
 2019
 2 years
 22 months1 Service terminated on October 31, 2018.
 Executive Committee  As
at June 30, 2019, the Executive Committee consisted of Mr. D.J. Pretorius
(Chairman), Mr. A.J. Davel, Mr. W.J. Schoeman and Ms. R. Masemene.  The Executive Committee meets on a weekly basis to review
current operations, develop strategy and policy proposals for consideration 55


---

by the board of directors. Members of the Executive
Committee, who are unable to attend the meetings in person, are able to
participate via teleconference facilities, to allow participation in the
discussion and conclusions reached.  Board
Committees  The
board has established a number of standing committees to enable it to properly
discharge its duties and responsibilities and to effectively fulfill its
decision-making process. Each committee acts within written terms of reference
which have been approved by the board and under which specific functions of the
board are delegated. The terms of reference for all committees can be obtained
by application to the Company Secretary at the Company’s registered office.
Each committee has defined purposes, membership requirements, duties and
reporting procedures. Minutes of the meetings of these committees are
circulated to the members of the committees and made available to the board.
Remuneration of Non-Executive Directors for their services on the committees
concerned is determined by the board. The committees are subject to regular
evaluation by the board with respect to their performance and effectiveness.
The following information reflects the composition and activities of these
committees.  Committees of the Board of Directors  Remuneration
and Nominations Committee  As at June 30, 2019 the Remuneration and Nominations
Committee consisted of G C Campbell (Chairman: nominations), E A Jeneker
(Chairman: remuneration), and J A Holtzhausen. Pursuant to the board meeting on
August 29, 2019, changes were effected to the composition of the Remuneration
& Nominations Committee as follows: GC Campbell retained his chairmanship
of the Nominations component; T V B N Mnyango assumed the role of Chairwoman of
the Remuneration component, with E A Jeneker and K P Lebina as members of the
Committee.  The
Remuneration Committee and the Nominations Committee meets on anad hocbasis. All members of this committee are independent NEDs who are
independent according to the definition set out in the NYSE Rules. It is
chaired by the board chairman when matters relating to nominations are
discussed and by an independent NED when matters relating to remuneration are
discussed.  The
primary remuneration role of the committee is to execute the following
functions: ·ensure the establishment of a formal process for the
appointment of directors; ·ensure that inexperienced directors are developed through
a mentorship programme; ·ensure that directors receive regular briefings on
changes in risks, laws and the appropriate contribution; ·drive an annual process to evaluate the board, board
committees and individual directors; ·ensure that formal succession plans for the board, chief
executive officer and senior management appointments are developed and
implemented.  The
committee has a mandate to offer competitive packages that will attract and
retain executives of the highest caliber and encourage and reward superior
performance. Industry surveys are provided for comparative purposes, and to
assist the committee in the
formulation of remuneration policies that are market related.  The key
nominations responsibilities of the committee include the following: ·make recommendations to the board on the appointment of
new directors; ·make recommendations on the composition of the board and
the balance between executive and NEDs appointed to the board; ·review board structure, size and composition on a regular
basis; ·make recommendations on directors eligible to retire by
rotation; and ·apply the principles of good corporate governance and
best practice in respect of nominations matters.  Audit and Risk Committee  As at June 30, 2019 theAudit and Risk
Committeeconsisted ofJ A
Holtzhausen (Chairman), T V B N Mnyango and E A Jeneker. Following the board
meeting on August 29, 2019, T V B N Mnyango resigned with immediate effect from
membership of the Audit & Risk Committee and the following changes were
effected to the composition thereof: JA Holtzhausen retained his chairmanship
of the Audit & Risk Committee, with J J Nel and K P Lebina becoming the new
members thereof.  All
members of the Audit and Risk Committee are independent according to the
definition set out in the NYSE Rules. The committee’s charter deals with all
the aspects relating to its functioning.  The
Audit and Risk Committee charter sets out the committee’s terms of reference
which include responsibility for: ·appointment and oversight of external
auditors, audit process and financial reporting; ·oversight of internal audit; ·overseeing the integrated
reporting and assurance model; ·overseeing the development and annual review of a policy
and plan for risk management; ·ensuring that risk management assessments are performed
on a continuous basis; ·ensuring that reporting on risk management assessment is
complete, timely, accurate and accessible; ·ensuring that frameworks and methodologies are
implemented to increase the possibility of anticipating unpredictable risks; 56


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·ensuring that continuous risk monitoring by management
takes place.  The
Audit and Risk Committee meets each quarter with the external auditors, the
company’s manager: risk and internal audit, and the CFO. The committee reviews
the audit plans of the internal auditors to ascertain the extent to which the
scope of the audits can be relied upon to detect weaknesses in internal
controls. It also reviews the annual and interim financial statements prior to
their approval by the board.  The
committee is responsible for making recommendations to appoint, reappoint or
remove the external auditors, and the designated external audit partner as well
as determining their remuneration and terms of engagement. In accordance with
its policy, the committee preapproves all audit and non-audit services provided
by the external auditors. KPMG Inc. was reappointed by shareholders at thelastAGM on November 30, 2018 to perform
DRDGOLD’s external audit function, such appointment was made by the
shareholders in accordance with the laws of South Africa and upon
recommendation of the board following the Audit and Risk Committee.  The
internal audit function is performed in-house, with the assistance of
Pro-Optima Audit Services Proprietary Limited. Internal audits are performed at
all DRDGOLD operating units and are aimed at reviewing, evaluating and
improving the effectiveness of risk management, internal controls and corporate
governance processes.  Significant
deficiencies, material weaknesses, instances of non-compliance and exposure to
high risk and development needs are brought to the attention of operational
management for resolution and reported to the Audit and Risk
Committee.
The committee members have access to all the records of the internal audit
team.  DRDGOLD’s
internal and external auditors have unrestricted access to the chairman of the
Audit and Risk Committee and, where necessary, to the chairman of the board and
the CEO. All significant findings arising from audit procedures are brought to
the attention of the committee and, if necessary, to the board.  Section
404 of the
Sarbanes-Oxley Act of 2002 stipulates that management is required to
assess the effectiveness of the internal controls surrounding the financial
reporting process. The results of this assessment are reported in the form of a
management attestation report that is filed with the SEC as part of the Form
20-F. Additionally, DRDGOLD’s external auditors are required to express an
opinion on the effectiveness of internal controls over financial reporting,
which is also contained in the Company’s Form 20-F.  An
important aspect of risk management is the transfer of risk to third parties to
protect the company from disaster. DRDGOLD’s major assets and potential
business interruption and liability claims are therefore covered by the group
insurance policy, which encompasses all the operations. Most of these policies
are held through insurance companies operating in the United Kingdom, Europe
and South Africa. The various risk-management initiatives undertaken within the
group as well as the strategy to reduce costs without compromising cover have
been successful and resulted in substantial insurance cost savings for the
Group.  Social
and Ethics Committee  As at
June 30,2019, the Social and Ethics
Committee consisted of Mr. E.A. Jeneker (Chairman), Mr. D.J. Pretorius and Mrs.
TVBN Mnyango. Membership thereof remains unchanged. The Social and
Ethics Committee is a statutory body established in terms of section 72 of the
Companies Act, 2008; the objectives of which are to facilitate transformation
and sustainable development by,inter alia,promoting transformation
within the Company and economic empowerment of previously disadvantaged
communities particularly within the areas where the Company conducts business;
striving towards achieving the goal of equality as the South African Constitution
and other legislation require within the context of the demographics of the
country at all levels of the Company and its subsidiaries; and conducting
business in a manner which is conducive to internationally acceptable
environmental and sustainability standards.  The
following terms of reference were approved by the board to enable the committee
to function effectively. These are to be responsible for and make
recommendations to the board with respect to the following matters: ·to monitor the company’s activities with regard to the 10
principles set out in the United Nations Global Compact Principles and the OECD
recommendations regarding Corruption, the Employment Equity Act and the Broad
Based Black Economic Empowerment Act; ·maintaining records of sponsorship, donations and
charitable giving; ·reviewing matters relating to the
environment, health and public safety, including the impact of the company’s
activities and of its products or services; ·reviewing matters relating to labour
and employment ·reviewing and recommending the company’s code of ethics; ·reviewing and recommending any corporate citizenship
policies; ·reviewing significant cases of employee conflicts of
interests, misconduct or fraud, or any other unethical activity by employees or
the Company  57


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6D. EMPLOYEES  Employees  The total number of
employees at June 30, 2019, of 2,617 comprises 1,591 specialized service
providers and 1,026 employees who are directly employed by us and our
subsidiary companies.  The
total number of employees at June 30, 2018, of 2,304 comprises 1,426
specialized service providers and 878 employees who are directly employed by us
and our subsidiary companies.  The
total number of employees at June 30, 2017, of 2,215 comprises 1,365
specialized service providers and 850 employees who are directly employed by us
and our subsidiary companies.  The
total number of employees at September 30, 2019, of 2,635 comprises 1,631
specialized service providers and 1,004 employees who are directly employed by
us and our subsidiary companies.  All
of our employees are based at our operations that operate exclusively in South Africa. Labor
Relations  As at June 30, 2019, approximately 92% of
our Ergo employees and 70% of our FWGR employees are members of trade unions or
employee associations. South Africa's labor relations environment remains a
platform for social reform. The National Union of Mineworkers, or NUM, one of the
main South African mining industry unions, is influential in the tripartite
alliance between the ruling African National Congress, the Congress of South
African Trade Unions, or COSATU, and the South African Communist Party as it is
the biggest affiliate of COSATU. The relationship between management and labor
unions remains cordial. The organized labor coordinating forum meets regularly
to discuss matters pertinent to both parties.  On September 16, 2019, Ergo signed a
two-year wage agreement with the Majority Unions for anaverage increase of
5.9% per annum across our workforcewith
individual increasesranging from 5.5% to 7% per annum,
with the intention to extend this agreement to a third year. The next round of wages and conditions of employment
negotiations will commence in June 2019.  As part of the
transitional arrangements at FWGR, a three-year wage agreement is in place and
is expected to conclude in June 2021.  We
recognize the need for transformation and have put systems and structures in
place to address this at both management and board level.  Safety statistics  Due to the importance of our labor force,
we continuously strive to create a safe and healthy working environment. The
following are our fiscal 2019 overall safety statistics for our operations:  (Per
  million man hours)
 Ergo
 FWGR
 ConsolidatedYear ended June 30,
 Year ended June 30,
 Year ended June 30,2019
 2018
 2019
 2019
 2018Lost
  time injury frequency rate (LTIFR)1
 2.37
 2.92
 2.37
 2.37
 2.92Reportable
  incidence frequency rate (RIFR)1
 1.69
 1.55
 2.37
 1.78
 1.55Fatalities
 1
 -
 -
 1
 -1 Calculated as follows: actual number of instances divided by
  the total number of man hours worked multiplied by one million.
 6E. SHARE OWNERSHIP  **To the best of our knowledge, we believe that our
ordinary shares held by prescribed officers and directors, in aggregate, do not
exceed one percent of the Company’s issued ordinary share capital. For details
of share ownership of directors and prescribed officers see Item 7A. Major
Shareholders.  As of June 30, 2019, directors and prescribed officers do
not hold any options to purchase ordinary shares.  *Closed periods apply
to share trading by directors, prescribed officers and other employees,
whenever persons become or could potentially become aware of material price
sensitive information, such as information relating to an acquisition,
bi-annual results etc., which is not in the public domain. When these persons
have access to this information an embargo is placed on share trading for those
individuals concerned. The embargo need not involve the entire Company in the
case of an acquisition and may only apply to the board of directors, executive
committee, and the financial and new business teams, but in the case of interim
and year-end results the closed-period is group-wide.* DRDGOLD
Phantom Share Scheme (Amended November 2015)  58


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Salient terms of the DRDGOLD Phantom Share Scheme are disclosed inItem 18.‘‘Financial Statements
- Note 19.1 Liability for Long-Term Incentive Scheme’’  During
fiscal year 2016, DRDGOLD’s Remuneration and Nominations Committee approved
a revised long-term incentive scheme. On November 4, 2015, the committee
approved an allocation of 20,527,978 phantom shares which is driven by share
price performance and individual performance and is based on phantom share
allocations. The vesting of any shares allocated is staggered over a five-year
period commencing in the third year after the allocation is granted in line
with King IV Report recommendations. The objectives of the revised scheme are
to drive the longer-term strategies of DRDGOLD, to align participants’
interests with shareholders’ interest, to incentivise and motivate
participants, to attract and retain scarce human resources and to reward
superior performance by the Company and participants. Remuneration and
Nominations Committee has the authority to amend in part or in its entirety
or withdraw the long-term incentive scheme at any time.  388,547
phantom shares were granted during fiscal year 2019 (2018 and 2017: nil). 16,157,058
phantom shares were outstanding on June 30, 2019 (2018: 20,189,467).   59


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Proposed DRDGOLD Management Long-Term Incentive Scheme DRDGOLD
proposes to introduce a new long-term incentive scheme (“Scheme”) for purposes
of replacing the current long-term phantom share scheme. The current scheme has
a finite life and comes to an end with the vesting of the last phantom shares
during fiscal year 2020. The adoption of the Scheme is subject approval by
shareholders at the 2019 annual general meeting to be held on December 2, 2019. Certain key features
of the Scheme are: Equity
settled The Scheme will be
equity-settled.  Equity-settlement will be implemented by way of market  acquisition
of DRDGOLD ordinary shares or through the issue of authorised but unissued shares
or treasury shares. Participants Persons eligible to
participate in the Scheme will be permanent employees (which, for the avoidance
of doubt, includes an executive director, but excludes a non-executive
director) of the Company and its subsidiaries, in Category 19 and above (“Participants”). Award
of Conditional Shares Pursuant to the
Scheme, the Company’s Remuneration Committee will
resolve, on an annual basis, to award “Conditional Shares” (“Award”)
which are comprised of: ·“Performance Shares” which are subject to conditions, as set out
in the rules of the Scheme and performance conditions; and ·“Retention Shares” which are subject to conditions, as set out
in the rules of the Scheme. Participants are not
required to pay for Awards or Shares Settled in terms of
vested Awards. Annual awards of
Conditional Shares will be made, in two forms: ·80% of the Award will be comprised of Performance Shares ·20% of the Award will be comprised of Retention Shares The target award value
will be referenced to market-related award quanta, and will be adjusted based
upon individual performance as follows: Individual Rating
 % of Target Value
  Awarded< 2.75
 0%2.75 to < 3.00
 50%3.0 to < 3.75
 100%3.75 to < 4.5
 133.33%4.5 to < 5.0
 166.67%5.0
 200%
  Dividend
and Voting Rights The Conditional Share
Awards carry no dividend or voting rights, until Settled, and therefore any
transfer and other rights associated with the Conditional Shares will only vest
following settlement; Vesting
of the Conditional Shares Conditional Shares
will vest 3 years after the date of Award (“Award Date”), subject to the
rules of the Scheme. The Scheme also makes provision for 50%
of the Awards proposed to be made in 2019 to vest in 2021 (being 2 years after
the Award Date) and the remaining 50% to vest in 2022 (being 3 years after the
Award Date). Performance Shares
(80%) will vest subject to service and performance conditions as follows: ·DRDGOLD’s Total Shareholder Return (“TSR”) over the
3-year vesting period exceeding DRDGOLD’s Weighted Average Cost of Capital “WACC”)
– if achieved, 40% of the Conditional Shares awarded will vest, subject to the remaining conditions for vesting applicable to
Performance Shares having being fulfilled; ·DRDGOLDS’s TSR over the 3-year vesting period compared to a
comparator peer group, as follows: 60


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Percentile of Peers
 % of Conditional Shares
  Vesting< 25th percentile
 0%25th to < 50th
  percentile
 10%50th to < 75th
  percentile
 30%≥ 75th
  percentile
 40%
 ·Attaining a threshold individual performance rating over the
3-year vesting period; and ·The Participant being in active service and not under notice of
resignation at the Settlement date. Retention Shares (20%)
will vest subject to service and performance conditions as
follows: ·Attaining a threshold individual performance rating over the
3-year vesting period; and ·The Participant being in active service and not under notice of
resignation at the Settlement date. Awarded Conditional
Shares which do not Vest to the Participant, as a result of forfeiture or which
lapse, revert back to the Scheme. Share
Limits Overall
Company Limit The aggregate number
of Shares at any one time which may be awarded for Settlements under the Scheme
shall not exceed 34,500,000 (thirty four million, five hundred thousand) Shares
(representing approximately 4.95% of the total issued share capital of the
Company at the date of this Notice). Individual
Limit Subject to certain
dilution adjustments, the aggregate number of
Shares at any one time which may be awarded under the Scheme to any one
Participant shall not exceed 14,500,000 Shares.  61


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ITEM 7. MAJOR
SHAREHOLDERS AND RELATED PARTY TRANSACTIONS  7A. MAJOR
SHAREHOLDERS  As of September
30, 2019, our issued capital consisted of: ·696,429,767 ordinary shares of
no par value; and ·5,000,000 cumulative preference shares.  To
our knowledge, as of 30 June 2019, we were not directly or indirectly owned or
controlled by another corporation or any person or foreign government, other than control in the form of ownership of a
significant amount of our shares and option to acquire further shares, as is
the case for Sibanye-Stillwater.  On
July 31, 2018, 265 million ordinary shares were issued to Sibanye-Stillwater as
settlement of the purchase consideration for the acquisition of the WRTRP
Assets. As part of this acquisition, Sibanye-Stillwater was granted an option
to subscribe for further shares to achieve a 50.1% shareholding within 2 years
from the effective date of the acquisition at a 10% discount to the prevailing
market value.  Other
than the above there are no arrangements, the operation of which may at a
subsequent date result in a change in control of us.  Based
on information available to us, as of September 30, 2019: there were 5,588 record holders of our ordinary shares in
South Africa, who held 382,838,557 or approximately 55.0% of our ordinary
shares; ·there was one record holder of our cumulative preference
shares in South Africa, who held 5,000,000 ordinary shares or 100% of our
cumulative preference shares; ·there were 25 US record holders of our ordinary shares,
who held approximately 21,669,402 ordinary shares or approximately 3.11% of our
ordinary shares excluding those shares held as part of our ADR program; and ·there were 687 registered holders of our ADRs in the
United States, who held approximately 197,889,430 shares (19,788,943 ADRs) or
approximately 28.4% of our ordinary shares.  The
following table sets forth information regarding the beneficial ownership of
our ordinary shares as of September 30, 2019, by:  ·each of our directors and prescribed officers; and ·any person whom the directors are aware of as at
September 30, 2019 who is interested directly or indirectly in 1% or more of
our ordinary shares. There was significant change in the percentage ownership
of the major shareholders over the preceding three years.  Shares Beneficially ownedHolder
 Number
 Percent of outstanding ordinary sharesDirectors/prescribed
  officersD.J.
  Pretorius
 690,188
 *A.J. Davel
 100,000
 *J.
  Turk
 243,000
 *G.C.
  Campbell
 200,000
 *OtherSibanye-Stillwater
 265,000,000
 38.05%Ruffer,
  LLP
 49,644,390
 7.13%Renaissance
  Technologies, LLC
 12,535,150
 1.80%*     Indicates share ownership of less than 1% of our
  outstanding ordinary shares.
 No shareholder
has voting rights which differ from the voting rights of any other shareholder.   62


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Cumulative Preference Shares  Randgold
and Exploration Company Limited, or Randgold, owns 5,000,000 (100%) of our
cumulative preference shares. Randgold's registered address is Suite 25,
Katherine & West Building, Corner of Katherine and West Streets, Sandown,
Sandton, 2196.  The
holders of cumulative preference shares do not have voting rights unless any
preference dividend is in arrears for more than six months. The terms of issue
of the cumulative preference shares are that they carry the right, in priority
to the Company's ordinary shares, to receive a dividend equal to 3% of the
gross future revenue generated by the exploitation or the disposal of the
Argonaut mineral rights acquired from Randgold in September 1997.
Additionally, holders of cumulative preference shares may vote on resolutions
which adversely affect their interests and on the disposal of all, or
substantially all, of our assets or mineral rights. There is currently no
active trading market for our cumulative preference shares. Holders of
cumulative preference shares will only obtain their potential voting rights
once the Argonaut Project becomes an operational gold mine, and dividends accrue
to them. The prospecting rights have since expired and the Argonaut Project
terminated.The
development of the project is not expected to materialise and therefore no
dividend is expected to be paid.  7B. RELATED PARTY
TRANSACTIONS  Transactions with related parties are disclosed inItem 18. ‘‘Financial Statements - Note 6.2 – Cost of
sales’’  Remuneration paid to key management is disclosed inItem 18. ‘‘Financial Statements - Note 19.2 – Key
management personnel remuneration’’  7C. INTERESTS OF EXPERTS AND COUNSEL  Not
applicable.  ITEM 8. FINANCIAL INFORMATION  8A. CONSOLIDATED STATEMENTS AND OTHER FINANCIAL
INFORMATION  1.Please refer to Item 18. Financial Statements.  2.Please refer to Item 18. Financial Statements.  3.Please refer to Item 18. Financial Statements.  4.The last year of audited financial statements is not
older than 15 months.  5.Not applicable.  6.Not applicable.  7.See under Item 4D. Property, plant and equipment—Ongoing Legal
Proceedings.  8.Please see Item 10B. Memorandum of Incorporation.   8B. SIGNIFICANT CHANGES  Significant changes that
have occurred since June 30, 2019, the date of the last audited financial
statements included in this Annual Report, are discussed in the relevant notes
to the financial statements under Item 18. Financial Statements.  63


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ITEM 9. THE OFFER AND LISTING  9A. OFFER AND LISTING
DETAILS  The principal
trading market for our equity securities is the JSE (symbol: DRD) and our ADSs
that trade on the New York Stock Exchange (symbol: DRD). The ADRs are issued by
The Bank of New York Mellon, as depositary. Each ADR represents one ADS and
each ADS represents ten of our ordinary shares. Until July 23, 2007, each ADS
represented one of our ordinary shares.    The cumulative preference shares are not traded on any
exchange. There have been no trading suspensions
with respect to our ordinary shares on the JSE during the past three years
ended June 30, 2019, nor have there been any trading suspensions with respect
to our ADRs on the New York Stock Exchange since our listing on that market.  9B. PLAN OF DISTRIBUTION  Not applicable.  9C. MARKETS  Nature of Trading Markets  See“Offer and Listing Details”above.  9D. SELLING SHAREHOLDERS  Not applicable. 9E. DILUTION  Not applicable.  9F. EXPENSES OF THE ISSUE  Not applicable.  ITEM 10. ADDITIONAL INFORMATION  10A. SHARE CAPITAL  Not applicable.  10B. MEMORANDUM OF INCORPORATION  As of June 30, 2019,
we had authorized for issuance 1,500,000,000 ordinary shares of no par value
(as of September 30, 2019: 1,500,000,000), and 5,000,000 cumulative preference
shares of R0.10 par value (as of September 30, 2019: 5,000,000). On this date,
we had issued 696,429,767 ordinary shares (as of September 30, 2019: 696,429,767)
and 5,000,000 cumulative preference shares (as of September 30, 2019:
5,000,000).  Set
out below are brief summaries of certain provisions of our Memorandum of
Incorporation, or our MOI, the Companies Act of South Africa and the JSE
Listings Requirements, all as in effect on June 30, 2019 and September 30, 2019.
The summary does not purport to be complete and is subject to and qualified in
its entirety by reference to the full text of the MOI, the Companies Act, and
the JSE Listings Requirements.  We
are registered under the Companies Act of South Africa under registration
number 1895/000926/06. As set forth in our Memorandum of Incorporation, the
main object and business of our company is mining and exploration for gold and
other minerals.  Borrowing Powers  Our
directors may from time to time borrow for the purposes of the company, such
sums as they think fit and secure the payment or repayment of any such sums, or
any other sum, as they think fit, whether by the creation and issue of
securities, mortgage or charge upon all or any of the property or assets of the
company. The directors shall procure that the aggregate principal amount at any
one time outstanding in respect of monies so borrowed or raised by the company
and all the subsidiaries for the time being of the company shall not exceed the
aggregate amount at that time authorized to be borrowed or secured by the
company or the subsidiaries for the time being of the company (as the case may
be).  Share
Ownership Requirements  Our
directors are not required to hold any shares to qualify or be appointed as a
director.  64


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Voting by Directors  A
director may authorize any other director to vote for him at any meeting at
which neither he nor his alternate director appointed by him is present. Any
director so authorized shall, in addition to his own vote, have a vote for each
director by whom he is authorized.  The
quorum necessary for the transaction of the business of the directors is a
majority of the directors present at a meeting before a vote may be called at
any meeting of directors.  Directors
are required to notify our board of directors of interests in companies and contracts.
If a director has a personal financial interest in respect of a matter to be
considered at a meeting of the board he or she must disclose the interest and
its nature, any material information relating to the matter and thereafter
leave the meeting immediately after making the disclosure. Such director must
not take part in consideration of the matter. He is not to be regarded as being
present for the purpose of determining whether a resolution has sufficient
support to be adopted.  The
King IV Report on Corporate Governance for South Africa, 2016 (King IV) was
published on 1 November 2016 and came into effect on 1 April 2017 for companies
with financial years commencing thereafter. The application regime for King IV
is "apply and explain", requiring companies to substantially and
meaningfully strive towards good corporate governance. King IV is principles
and outcomes based: a departure from mere compliance-based mindset. King IV
recognises that sound governance outcomes, exemplified by integrity,
competence, responsibility, accountability, fairness and transparency, are the
cardinal pillars of good corporate citizenship.  The
remuneration of non-executive directors is typically determined by the board,
but subject to approval by the shareholders at the AGM of the Company. In terms
of section 65(11)(h) of the Companies Act, 2008 read with sections 66(8) and
66(9) thereof, remuneration may only be paid to directors for their services as
directors in accordance with a special resolution approved by the shareholders
within the  previous 2 (two) years. A special resolution was passed at the 2017
AGM on November 30, 2017 to increase the NED remuneration.  The
JSE Limited has since made the adoption and application of King IV mandatory
for all listed companies.  Under
South African common law, directors are required to comply with certain
fiduciary duties to the company and to exercise proper care and skill in
discharging their responsibilities. These common law duties have now been
codified by the Companies Act.  Age
Restrictions  There
is no age limit for directors.  Election
of Directors  Each
director shall be appointed by election by way of an ordinary resolution of
shareholders at a general or annual meeting of company (“elected director (s)”)
and no appointment of a director by way of a written circulated shareholders
resolution in terms of section 60 of the Companies Act shall be competent.  One
third of our directors, on a rotating basis, are subject to re-election at each
annual general shareholder’s meeting. Retiring directors usually make
themselves available for re-election. An amendment to the MOI which also
subjects executive directors to re-election by rotation was approved by
shareholders at the 2014 annual general meeting.  General
Meetings  On
the request of any shareholder or shareholders holding not less than 10 percent
of our share capital which carries the right of voting at general meetings, we
shall issue a notice to shareholders convening a general meeting for a date not
less than 15 days from the date of the notice. Directors may convene
general meetings at any time.  Our
annual general meeting and a meeting of our shareholders for the purpose of
passing a special resolution may be called by giving 15 days advance
written notice of that meeting. For any other general meeting of our
shareholders, 15 days advance written notice is required.  Our
MOI provides that if at a meeting convened upon request by our shareholders, a
quorum is not present within fifteen minutes after the time selected for the
meeting, such meeting shall be postponed for one week. However the chairman has
the discretion to extend the fifteen minutes for a reasonable period on certain
grounds. The necessary quorum is three members present with sufficient voting
powers in person or by proxy to exercise in aggregate 25% of the voting rights.  Voting
Rights  The
holders of our ordinary shares are generally entitled to vote at general
meetings and on a show of hands have one vote per person and on a poll have one
vote for every share held. The holders of our cumulative preference shares are
not entitled to vote at a general meeting unless any preference dividend is in
arrears for more than six months at the date on which the notice convening
the general meeting is posted to the shareholders. Additionally, holders of
cumulative preference shares may vote on resolutions which adversely affect
their interests and on resolutions regarding the disposal of all or
substantially all of our assets or mineral rights. When entitled to vote,
holders of our cumulative preference shares are entitled to one vote per person
on a show of hands and that portion of the total votes which the aggregate
amount of the nominal value of the shares held by the relevant shareholder
bears to the aggregate amount of the nominal value of all shares issued by us.  65


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66


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Dividends  We may, in a general meeting, or our
directors may, from time to time, declare a dividend to be paid to the
shareholders in proportion to the number of shares they each hold. No dividend
shall be declared except out of our profits. Dividends may be declared either
free or subject to the deduction of income tax or duty in respect of which we
may be charged. Holders of ordinary shares are entitled to receive dividends as
and when declared by the directors.  Ownership
Limitations  There
are no limitations imposed by our MOI or South African law on the rights of
shareholders to hold or vote on our ordinary shares or securities convertible
into our ordinary shares.  Winding-up  If
we are wound-up, then the assets remaining after payment of all of our debts
and liabilities, including the costs of liquidation, shall be applied to repay
to the shareholders the amount paid up on our issued capital and thereafter the
balance shall be distributed to the shareholders in proportion to their
respective shareholdings. On a winding up, our cumulative preference shares
rank, in regard to all arrears of preference dividends, prior to the holders of
ordinary shares. As of June 30, 2019 and September 30, 2019, no such dividends
have been declared. Except for the preference dividend and as described in this
Item our cumulative preference shares are not entitled to any other
participation in the distribution of our surplus assets on winding-up.  Reduction of Capital  We may, by special resolution, reduce the
share capital authorized by our MOI, or reduce our issued share capital
including, without limitation, any stated capital, capital redemption reserve
fund and share premium account by making distributions and buying back our
shares.  Amendment of theMOI  Our MOI may be altered by the passing of
a special resolution or in compliance with a court order. The Company may also
amend the MOI by increasing or decreasing the number of authorized shares,
classifying or reclassifying shares, or determining the terms of shares in a
class. A special resolution is passed when the shareholders holding at least
25% of the total votes of all the members entitled to vote are present or
represented by proxy at a meeting and, if the resolution was passed on a show
of hands, at least 75% of those shareholders voted in favor of the resolution
and, if a poll was demanded, at least 75% of the total votes to which those
shareholders are entitled were cast in favor of the resolution. An amendment to
the MOI to increase the number of authorized shares was approved by
shareholders at the 2018 general meeting on March 28, 2018.  Consent
of the Holders of Cumulative Preference Shares  The
rights and conditions attaching to the cumulative preference shares may not be
cancelled, varied or added, nor may we issue shares ranking, regarding rights
to dividends or on winding up, in priority to or equal with our cumulative
preference shares, or dispose of all or part of the Argonaut mineral rights
without the consent in writing of the registered holders of our cumulative
preference shares or the prior sanction of a resolution passed at a separate
class meeting of the holders of our cumulative preference shares.  Distributions  We
are authorized to make payments in cash or in specie to our shareholders in
accordance with the provisions of the Companies Act and other consents required
by law from time to time. We may, for example, in a general meeting, upon
recommendation of our directors, resolve that any surplus funds representing capital
profits arising from the sale of any capital assets and not required for the
payment of any fixed preferential dividend, be distributed among our ordinary
shareholders. However, no such profit shall be distributed unless we have
sufficient other assets to satisfy our liabilities and to cover our paid up
share capital. We also need to consider the solvency and liquidity requirements
stated in the Companies Act of South Africa.  Directors’
power to vote compensation to themselves  The
remuneration of non-executive directors may not exceed in aggregate in any
financial year the amount fixed by the Company in general meeting. The
Companies Act requires that remuneration to non-executive directors may be paid
only in accordance with a special resolution approved by shareholders within
the previous two years.  Time
limit for dividend entitlement  All
unclaimed monies that are due to any shareholder/s shall be held by the company
in trust for an indefinite period until lawfully claimed by such shareholder/s,
subject to the Prescription Act, 1968 as amended or any other law which governs
the law of prescription.  Staggered
director elections & cumulative voting  At each annual general meeting of the Company one-third
of the directors shall retire and be eligible for re-election. No provision is
made for cumulative voting. 67


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Sinking
fund provisions and liability to further capital calls  There
are no sinking fund provisions in the MOI attaching to any class of the company
shares, and the company does not subject shareholders to liability to further
capital calls.  Provision
that would delay/prevent change of control  The
Companies Act provides that companies which propose to merge or amalgamate must
enter into a written agreement setting out the terms thereof. They must prove
that upon implementation of the amalgamation or merger each will satisfy the
solvency and liquidity test. Companies involved in disposals, amalgamations or
mergers, or schemes of arrangement must obtain a compliance certificate from
the Takeover Regulation Panel, pass special resolutions and in some instances
they must obtain an independent expert report.  10C. MATERIAL CONTRACTS Acquisition
of FWGR (WRTRP Assets) from Sibanye-Stillwater Sibanye-Stillwater
Exchange Agreement On November 22, 2017,
Sibanye-Stillwater, WRTRP Proprietary Limited, subsequently renamed FWGR
Proprietary Limited, and the Company entered into the Sibanye-Stillwater
Exchange Agreement. Under the Sibanye-Stillwater Exchange Agreement,
Sibanye-Stillwater agreed to dispose certain gold surface processing assets and
tailing storage facilities that include Driefontein 3 and 5, Kloof 1,
Venterspost North and South, Libanon, Driefontein 4, Driefontein 2 plant,
Driefontein 3 plant, WRTRP pilot plant, and land required for the future
development of a central processing plant, regional tailings storage facility
and return water dam (together, the “WRTRP Assets”) to FWGR Proprietary
Limited, in exchange for the issuance of 999 shares of FWGR Proprietary Limited
shares (comprising its entire share capital) to Sibanye-Stillwater, subject to
certain conditions that include the consummation of certain agreements such as
the DRD Exchange Agreement, DRD Guarantee and DRD Option Agreement, among
others. DRD
Guarantee In connection with the
Sibanye-Stillwater Agreement and the DRD Exchange Agreement, on November 22,
2017, the Company issued a guarantee to and in favor of Sibanye-Stillwater the
due, punctual and full payment and performance which WRTRP Proprietary Limited
has, or may from time to time have, to Sibanye-Stillwater in terms of any
agreements to give effect to the transactions contemplated by the DRD Exchange
Agreement (the “Guaranteed Obligation”) and to indemnify Sibanye-Stillwater
immediately on demand against any and all losses, liabilities, damages, costs
or expenses (but excluding any indirect, special, consequential or incidental
loss or damage) suffered by Sibanye-Stillwater if any indebtedness, payment
obligation or other obligation guaranteed by the Company under certain
enumerated events. The Company also undertook that if any Guaranteed Obligation is or becomes unenforceable,
invalid or illegal, the Company shall, as an independent and primary
obligation, indemnify Sibanye-Stillwater, subject to a monetary limit. Option
Agreement In addition, on November 22,
2017, Sibanye-Stillwater and the Company entered into the Option Agreement.
Under the Option Agreement, the Company granted Sibanye-Stillwater the
irrevocable right and option to call on the Company to allot and issue
additional ordinary shares to Sibanye-Stillwater, re"sulting in
Sibanye-Stillwater holding 50.1% of all ordinary shares of the Company
(including any of the Company’s ordinary shares held as treasury shares),
subject to the condition that such option be exercised within 24 months of the
closing of the Transaction and subject to Sibanye-Stillwater not having
disposed of all or any of the Consideration Shares during the Option Period.
The Option must be exercised in whole anytime within the Option Period. The
price of such shares would be set at the 30-day volume weighted average price
per DRDGOLD's ordinary share on the Johannesburg Stock Exchange preceding the
exercise date minus 10%. During the period between the date upon which the
option is exercised and the closing date, the Company agreed that it shall not
issue any ordinary shares, and not issue any ordinary shares and/or any
securities convertible into the Company’s ordinary shares, and/or grant any
options and/or rights to require the issue of the Company’s ordinary shares or
securities convertible into the Company’s ordinary shares at any time or on or
after the closing of the exchange transactions, subject to certain limitations.  The description of the
Sibanye-Stillwater Exchange Agreement, DRD Guarantee and Option Agreement is
qualified by reference to the Sibanye-Stillwater Exchange Agreement, DRD
Guarantee and Option Agreement filed as Exhibits to our
annual report on Form 20-F for the fiscal year ended June 30, 2018. ZAR300
million Revolving Credit Facility On August 1, 2018, DRDGOLD
Limited entered into a ZAR300 million Revolving Credit Facility (“RCF”)
secured with ABSA Bank Limited (acting through its Corporate and Investment
Banking division). The purpose of the RCF was to finance the development of
Phase 1 of FWGR and working capital requirements, replacing the R100 million
overdraft facility that was in place during the year ended 30 June 2018. 68


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The RCF
bears interest at JIBAR plus a margin of 325 basis points nominal annual
compounded quarterly. The borrowers are required to pay a commitment fee of 35%
of the applicable margin per annum. There is a debt origination fee of 1% of
the available commitment. Relevant covenants include that, during any rolling 12 month
period, (i) the interest cover1 shall not be less than 4 times and
(ii) net debt 2 to adjusted EBITDA Ratio shall not exceed 2 times.  1 Interest cover means the ratio of EBITDA to Total Net Interest
(interest charged on Financial Indebtedness after deducting all interest
received on Cash and cash equivalents (excluding interest received on
restricted cash)). 2 Means Total Debt after deducting Cash and cash equivalents
(excluding restricted cash) The final repayment date of the
RCF is August 1, 2020. The description of the RCF is
qualified by reference to the RCF filed herewith as an Exhibit. Addendum
to the ZAR300 million Revolving Credit Facility and Performance Guarantee On December 10, 2018, DRDGOLD
Limited entered into an addendum to the ZAR300 million RCF. The purpose of the
addendum to the RCF was to commit R125 million of the RCF facility to a
performance guarantee to Ekurhuleni Metropolitan Municipality (“Municipality”)
that was issued on the same date by ABSA Bank Limited (acting through its
Corporate and Investment Banking division). In January 2019, the cash held in
escrow was released to the Ergo operational bank account.  The description of the addendum
to the RCF and the performance guarantee issued to the Municipality is
qualified by reference to the Addendum to the RCF and the Performance Guarantee
filed herewith as Exhibits to this report. 69


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10D. EXCHANGE CONTROLS  The following
is a summary of the material South African exchange control measures, which has
been derived from publicly available documents. The following summary is not a
comprehensive description of all the exchange control regulations. The discussion
in this section is based on the current law and positions of the South African
Government. Changes in the law may alter the exchange control provisions that
apply, possibly on a retroactive basis.  Introduction  Dealings
in foreign currency, the export of capital and revenue, payments by residents
to non-residents and various other exchange control matters in South Africa are
regulated by the South African exchange control regulations, or the
Regulations. The Regulations form part of the general monetary policy of South
Africa. The Regulations are issued under Section 9 of the Currency and
Exchanges Act, 1933 (as amended). In terms of the Regulations, the control over
South African capital and revenue reserves, as well as the accruals and
spending thereof, is vested in the Treasury (Ministry of Finance), or the
Treasury.  The
Treasury has delegated the administration of exchange controls to the Exchange
Control Department of the South African Reserve Bank, or SARB, which is
responsible for the day to day administration and functioning of exchange
controls. SARB has a wide discretion. Certain banks authorized by the Treasury
to co-administer certain of the exchange controls, are authorized by the
Treasury to deal in foreign exchange. Such dealings in foreign exchange by
authorized dealers are undertaken in accordance with the provisions and
requirements of the exchange control rulings, or Rulings, and contain certain
administrative measures, as well as conditions and limits applicable to
transactions in foreign exchange, which may be undertaken by authorized
dealers. Non-residents have been granted general approval, in terms of the
Rulings, to deal in South African assets, to invest and disinvest in South
Africa.  The
Regulations provide for restrictions on exporting capital from the Common
Monetary Area consisting of South Africa, Namibia, and the Kingdoms of Lesotho
and Swaziland. Transactions between residents of the Common Monetary Area are
not subject to these exchange control regulations.  There
are many inherent disadvantages to exchange controls, including distortion of
the price mechanism, problems encountered in the application of monetary
policy, detrimental effects on inward foreign investment and administrative
costs associated therewith. The South African Finance Minister has indicated
that all remaining exchange controls are likely to be dismantled as soon as
circumstances permit. Since 1998, there has been a gradual relaxation of
exchange controls. The gradual approach to the abolition of exchange controls
adopted by the Government of South Africa is designed to allow the economy to
adjust more smoothly to the removal of controls that have been in place for a
considerable period of time. The stated objective of the authorities is
equality of treatment between residents and non-residents with respect to
inflows and outflows of capital. The focus of regulation, subsequent to the
abolition of exchange controls, is expected to favor the positive aspects of prudential
financial supervision.  The present exchange control system in
South Africa is used principally to control capital movements. South African
companies are not permitted to maintain foreign bank accounts without SARB
approval and, without the approval of SARB, are generally not permitted to
export capital from South Africa or hold foreign currency. In addition, South
African companies are required to obtain the approval of the SARB prior to
raising foreign funding on the strength of their South African statements of
financial position, which would permit recourse to South Africa in the event of
defaults. Where 75% or more of a South African company's capital, voting power,
power of control or earnings is directly or indirectly controlled by non-residents,
such a corporation is designated an “affected person” by the SARB, and certain
restrictions are placed on its ability to obtain local financial assistance. We
are not, and have never been, designated an “affected person” by the SARB.  Foreign
investment and outward loans by South African companies are also restricted. In
addition, without the approval of the SARB, South African companies are
generally required to repatriate to South Africa profits of foreign operations
and are limited in their ability to utilize profits of one foreign business to
finance operations of a different foreign business. South African companies
establishing subsidiaries, branches, offices or joint ventures abroad are
generally required to submit financial statements on these operations as well
as progress reports to the SARB on an annual basis. As a result, a South
African company's ability to raise and deploy capital outside the Common
Monetary Area is restricted.  Although
exchange controls have been gradually relaxed since 1998, unlimited outward
transfers of capital are not permitted at this stage. Some of the more salient
changes to the South African exchange control provisions over the past few
years have been as follows:  ·corporations wishing to invest in countries outside the
Common Monetary Area, in addition to what is set out below, apply for
permission to enter into corporate asset/share swap and share placement
transactions to acquire foreign investments. The latter mechanism entails the
placement of the locally quoted corporation's shares with long-term overseas
holders who, in payment for the shares, provide the foreign currency abroad
which the corporation then uses to acquire the target investment; ·corporations wishing to establish new overseas ventures
are permitted to transfer offshore up to R500 million to finance approved
investments abroad and up to R500 million to finance approved new investments
in African countries on an annual bases. Approval from the SARB is required in
advance for investments in excess of R500 million. On application to the SARB,
corporations are also allowed to use part of their local cash holdings to
finance up to 10% of approved new foreign investments where the cost of these
investments exceeds the current limits; ·as a general rule, the SARB requires that more than 10%
of equity of the acquired off-shore venture is acquired within a predetermined
period of time, as a prerequisite to allowing the expatriation of funds. If
these requirements are not met, the SARB may instruct that the equity be
disposed of. In our experience the SARB has taken a commercial view on this,
and has on occasion extended the period of time for compliance; and 70


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·remittance of directors' fees payable to persons
permanently resident outside the Common Monetary Area may be approved by
authorized dealers, in terms of the Rulings.  Authorized
dealers in foreign exchange may, against the production of suitable documentary
evidence, provide forward cover to South African residents in respect of fixed
and ascertained foreign exchange commitments covering the movement of goods.  Persons
who emigrate from South Africa are entitled to take limited amounts of money
out of South Africa as a settling-in allowance. The balance of the emigrant's
funds will be blocked and held under the control of an authorized dealer. These
blocked funds may only be invested in:  ·blocked current, savings, interest bearing deposit
accounts in the books of an authorized dealer in the banking sector; ·securities quoted on the JSE and financial instruments
listed on the Bond Exchange of South Africa which are deposited with an
authorized dealer and not released except temporarily for switching purposes,
without the approval of the SARB. Authorized dealers must at all times be able
to demonstrate that listed or quoted securities or financial instruments which
are dematerialized or immobilized in a central securities depository are being
held subject to the control of the authorized dealer concerned; or ·mutual funds.  Aside
from the investments referred to above, blocked rands may only be utilized for
very limited purposes. Dividends declared out of capital gains or out of income
earned prior to emigration remain subject to the blocking procedure. It is not
possible to predict when existing exchange controls will be abolished or
whether they will be continued or modified by the South African Government in
the future.  Sale
of Shares  Under
present exchange control regulations in South Africa, our ordinary shares and
ADSs are freely transferable outside the Common Monetary Area between
non-residents of the Common Monetary Area. In addition, the proceeds from the
sale of ordinary shares on the JSE on behalf of shareholders who are not
residents of the Common Monetary Area are freely remittable to such
shareholders. Share certificates held by non-residents will be endorsed with
the words “non-resident,” unless dematerialized.  Dividends  Dividends
declared in respect of shares held by a non-resident in a company whose shares
are listed on the JSE are freely remittable.  Any
cash dividends paid by us are paid in rands. Holders of ADSs on the relevant
record date will be entitled to receive any dividends payable in respect of the
shares underlying the ADSs, subject to the terms of the deposit agreement
entered on August 12, 1996, and as amended and restated, between the Company
and The Bank of New York, as the depository. Subject to exceptions provided in
the deposit agreement, cash dividends paid in rand will be converted by the
depositary to dollars and paid by the depositary to holders of ADSs, net of
conversion expenses of the depositary, in accordance with the deposit
agreement. The depositary will charge holders of ADSs, to the extent
applicable, taxes and other governmental charges and specified fees and other
expenses.  Voting
rights  There are no limitations imposed by South
African law or by our MOI on the right of non-South African shareholders to
hold or vote our ordinary shares. 71


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10E. TAXATION  Material South African Income Tax Consequences  The following is a summary of material
income tax considerations under South African income tax law. No representation
with respect to the consequences to any particular purchaser of our securities
is made hereby. Prospective purchasers are urged to consult their tax advisers
with respect to their particular circumstances and the effect of South African
or other tax laws to which they may be subject.  South
Africa imposes tax on worldwide income of South African residents. Generally,
individuals not resident in South Africa do not pay tax in South Africa except
in the following circumstances:  Income
Tax and Withholding Tax on Dividends  Non-residents
will pay income tax on any amounts received by or accrued to them from a source
within (or deemed to be within) South Africa. Interest earned by a non-resident
on a debt instrument issued by a South African company will be regarded as
being derived from a South African source but will be regarded as exempt from
taxation in terms of Section 10(1)(i) of the South African Income Tax Act,
1962 (as amended), or the Income Tax Act. This exemption applies to so much of
any interest and dividends (which are not otherwise exempt) received from a
South African source not exceeding (a) R34,500 if the taxpayer is 65 years of
age or older or (b) R23,800 if the taxpayer is younger than 65 years of age at
the end of the relevant tax year.  No
withholding tax is deductible in respect of interest payments made to
non-resident investors.  Section 64F of the
amendments to the Income Tax Act as set out in Part VIII in Chapter II of the
Income Tax Act sets out beneficial owners who are exempt from the dividend tax
which includes resident companies receiving a dividend after the effective
date, being April 1, 2012. The Convention between the United States of America
and the Republic of South Africa for the Avoidance of Double Taxation and the
Prevention of Fiscal Evasion with Respect to Taxes on Income and Capital Gains,
or the Tax Treaty, would limit the rate of this tax with respect to dividends
paid on ordinary shares or ADSs to a U.S. resident (within the meaning of the
Tax Treaty) to 5% of the gross amount of the dividends if such U.S. resident is
a company which holds directly at least 10% of our voting stock and 20% of the
gross amount of the dividends in all other cases.  The above provisions shall not apply if the beneficial
owner of the dividends is resident in the United States, carries on business in
South Africa through a permanent establishment situated in South Africa, or
performs in South Africa independent personal services from a fixed base
situated in South Africa, and the dividends are attributable to such permanent
establishment or fixed base.  In
fiscal years 2019 and 2018, the corporate tax rates for taxable mining and non‐mining
income, to which the Companies in the Group is subject, were 34% and 28%,
respectively.The formula for determining the South
African gold mining tax rate for fiscal years ended2019and2018is: Y = 34 –
170/X. Where Y is the percentage rate of tax payable and X is the ratio of
taxable income, net of any qualifying capital expenditure that bears to mining
income derived, expressed as a percentage.  With effect from April 1,
2014,Section 8F of the Income Tax Act results inany amount of interest which is incurred in
respect of a “hybrid debt instrument” isdeemed to be a dividendin speciedeclared by the payor and received by the
recipient which is exempt from income tax, as opposed to interest which is
taxable. The terms of some of our intercompany loanscause the affected loans to be
deemed as“hybrid debt
instruments” and the interest thereof to be deemed to be an exempt dividendin specie. This characterization of the affected loans as a “hybrid
debt instrument” was not impacted bysubsequent
amendments to Section 8F of the Income Tax Act that became effective in fiscal
year2017.  U.S. Federal Income Tax Considerations  The following discussion is a summary of
the U.S. federal income tax considerations to U.S. holders of the ownership and
disposition of ordinary shares or ADSs. It deals only with U.S. holders who
hold ordinary shares or ADSs as capital assets for U.S. federal income tax
purposes. This discussion is based upon the provisions of the Internal Revenue
Code of 1986, as amended, or the Code, published rulings, judicial decisions
and the Treasury regulations, all as currently in effect and all of which are
subject to change, possibly on a retroactive basis. This discussion has no
binding effect or official status of any kind; we cannot assure holders that
the conclusions reached below would be sustained by a court if challenged by
the Internal Revenue Service.  This
discussion does not address all aspects of U.S. federal income taxation that
may be applicable to holders in light of their particular circumstances and
does not address special classes of U.S. holders subject to special treatment
(such as dealers in securities or currencies, partnerships or other
pass-through entities, banks and other financial institutions, traders in
securities that elect mark-to-market treatment, insurance companies, tax-exempt
organizations (including private foundations), certain expatriates or former
long-term residents of the United States, persons holding ordinary shares or
ADSs as part of a “hedge,” “conversion transaction,” “synthetic security,”
“straddle,” “constructive sale” or other integrated investment, persons who
acquired the ordinary shares or ADSs upon the exercise of employee stock
options or otherwise as compensation, persons whose functional currency is not
the U.S. dollar, or persons that actually or constructively own ten percent or
more of the voting power or value of our shares). This discussion addresses
only U.S. federal income tax considerations and does not address the effect of
any state, local, or foreign tax laws that may apply, the alternative minimum
tax, the Medicare tax or the application of the federal estate or gift tax.   72


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For purposes of this discussion, a “U.S. holder” is a
beneficial owner of ordinary shares or ADSs who or that is, for U.S. federal
income tax purposes:  ·a citizen or individual resident of the United States; ·a corporation (or any entity treated as a corporation for
U.S. federal income tax purposes) created or organized under the laws of the United
States or any political subdivision thereof; ·an estate, the income of which is subject to U.S. federal
income tax without regard to its source; or ·a trust, if a court within the United States is able to
exercise primary supervision over the administration of the trust and one or
more U.S. persons have the authority to control all substantial decisions of
the trust or if the trust has made a valid election to be treated as a U.S. person.  If
a partnership (or an entity treated as a partnership for U.S. federal income
tax purposes) holds any ordinary shares or ADSs, the tax treatment of a partner
will generally depend on the status of the partner and on the activities of the
partnership. Partners in partnerships holding any ordinary shares or ADSs are
urged to consult their tax advisors.  Because
individual circumstances may differ, U.S. holders of ordinary shares or ADSs
are urged to consult their tax advisors concerning the U.S. federal income tax
considerations applicable to their particular situations as well as any
considerations to them arising under the tax laws of any foreign, state or
local taxing jurisdiction.  Ownership
of Ordinary Shares or ADSs  For
purposes of the Code, a U.S. holder of ADSs will be treated for U.S. federal
income tax purposes as the owner of the ordinary shares represented by those
ADSs. Exchanges of ordinary shares for ADSs and ADSs for ordinary shares
generally will not be subject to U.S. federal income tax.  Subject
to the discussion below under the heading “Passive Foreign Investment Company”,
distributions with respect to the ordinary shares or ADSs, other than
distributions in liquidation and distributions in redemption of stock that are
treated as exchanges, will be taxed to U.S. holders as ordinary dividend income
to the extent that the distributions do not exceed our current and accumulated
earnings and profits. For U.S. federal income tax purposes, the amount of any
distribution received by a U.S. holder will equal the dollar value of the sum
of the South African rand payments made (including the amount of South African
income taxes, if any, withheld with respect to such payments), determined at
the “spot rate” on the date the dividend distribution is includable in such U.S.
holder's income, regardless of whether the payment is in fact converted into
dollars. Generally, any gain or loss resulting from currency exchange
fluctuations during the period from the date a U.S. holder includes the
dividend payment in income to the date such holder converts the payment into
dollars will be treated as ordinary income or loss. Distributions, if any, in
excess of our current and accumulated earnings and profits will constitute a
non-taxable return of capital and will be applied against and reduce the holder's
basis in the ordinary shares or ADSs.  To
the extent that these distributions exceed the U.S. holder's tax basis in the
ordinary shares or ADSs, as applicable, the excess generally will be treated as
capital gain, subject to the discussion below under the heading “Passive
Foreign Investment Company”. We do not intend to calculate our earnings or
profits for U.S. federal income tax purposes. U.S. holders should therefore
assume that any distributions with respect to our ordinary shares or ADSs will
constitute dividend income.  “Qualified
dividend income” received by individual U.S. holders (as well as certain trusts
and estates) generally will be taxed at a maximum U.S. federal income tax rate
applicable to capital gains.This reduced rate generally would apply to dividends paid
by us if, at the time such dividends are paid, either (i) we are eligible
for benefits under a qualifying income tax treaty with the United States or
(ii) our ordinary shares or ADSs with respect to which such dividends were
paid are readily tradable on an established securities market in the United
States. However, this reduced rate is subject to certain important requirements
and exceptions, including, without limitation, certain holding period
requirements and an exception applicable if we are treated as a passive foreign
investment company as discussed under the heading “Passive Foreign Investment
Company”. U.S. holders are urged to consult their tax advisors regarding the U.S.
federal income tax rate that will be applicable to their receipt of any
dividends paid with respect to the ordinary shares and ADSs.  For
purposes of this discussion, the “spot rate” generally means a rate that
reflects a fair market rate of exchange available to the public for currency
under a “spot contract” in a free market and involving representative amounts.
A “spot contract” is a contract to buy or sell a currency on or before two
business days following the date of the execution of the contract. If such a
spot rate cannot be demonstrated, the U.S. Internal Revenue Service has the
authority to determine the spot rate.  Dividend
income derived with respect to the ordinary shares or ADSs will not be eligible
for the dividends received deduction generally allowed to a U.S. corporation
under Section 243 of the Code. Dividend income will be treated as foreign
source income for foreign tax credit and other purposes. In computing the
separate foreign tax credit limitations, dividend income should generally
constitute “passive category income,” or in the case of certain U.S. holders,
“general category income.”   73


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Passive Foreign Investment Company  A
special and adverse set of U.S. federal income tax rules apply to a U.S. holder
that holds stock in a passive foreign investment company, or PFIC. We would be
a PFIC for U.S. federal income tax purposes if for any taxable year either
(i) 75% or more of our gross income, including our pro rata share of the
gross income of any company in which we are considered to own 25% or more of
the shares by value, were passive income or (ii) 50% or more of our
average total assets (by value), including our pro rata share of the assets of
any company in which we are considered to own 25% or more of the shares by
value, were assets that produced or were held for the production of passive
income. If we were a PFIC, U.S. holders of the ordinary shares or ADSs would be
subject to special rules with respect to (i) any gain recognized upon the
disposition of the ordinary shares or ADSs and (ii) any receipt of an excess
distribution (generally, any distributions to a U.S. holder during a single
taxable year that is greater than 125% of the average amount of distributions
received by such U.S. holder during the three preceding taxable years in
respect of the ordinary shares or ADSs or, if shorter, such U.S. holder's
holding period for the ordinary shares or ADSs). Under these rules:  ·the gain or excess distribution will be allocated ratably
over a U.S. holder's holding period for the ordinary shares or ADSs, as
applicable; ·the amount allocated to the taxable year in which a U.S. holder
realizes the gain or excess distribution will be taxed as ordinary income; ·the amount allocated to each prior year (other than a
pre-PFIC year), with certain exceptions, will be taxed at the highest tax rate
in effect for that year; and ·the interest charge generally applicable to underpayments
of tax will be imposed in respect of the tax attributable to each such year
(other than a pre-PFIC year).  Although
we generally will be treated as a PFIC as to any U.S. holder if we are a PFIC
for any year during a U.S. holder's holding period, if we cease to satisfy the
requirements for PFIC classification, the U.S. holder may avoid PFIC
classification for subsequent years if such holder elects to recognize gain
based on the unrealized appreciation in the ordinary shares or ADSs through the
close of the tax year in which we cease to be a PFIC.  A
U.S. holder of a PFIC is required to file an annual report with the Internal
Revenue Service containing such information as the U.S. Secretary of Treasury
may require.  A
U.S. holder of the ordinary shares or ADSs that are treated as “marketable
stock” under the PFIC rules may be able to avoid the imposition of the special
tax and interest charge described above by making a mark-to-market election.
Pursuant to this election, the U.S. holder would include in ordinary income or
loss for each taxable year an amount equal to the difference as of the close of
the taxable year between the fair market value of the ordinary shares or ADSs
and the U.S. holder's adjusted tax basis in such ordinary shares or ADSs.
Losses would be allowed only to the extent of net mark-to-market gain
previously included by the U.S. holder under the election for prior taxable
years. If a mark-to-market election with respect to ordinary shares or ADSs is
in effect on the date of a U.S. holder's death, the tax basis of the ordinary
shares or ADSs in the hands of a U.S. holder who acquired them from a decedent
will be the lesser of the decedent's tax basis or the fair market value of the
ordinary shares or ADSs. U.S. holders desiring to make the mark-to-market
election are urged to consult their tax advisors with respect to the
application and effect of making the election for the ordinary shares or ADSs.  In
the case of a U.S. holder who holds ordinary shares or ADSs and who does not
make a mark-to-market election, the special tax and interest charge described
above will not apply if such holder makes an election to treat us as a
“qualified electing fund” in the first taxable year in which such holder owns
the ordinary shares or ADSs and if we comply with certain reporting
requirements. However, we do not intend to supply U.S. holders with the
information needed to report income and gain pursuant to a “qualified electing
fund” election in the event that we are classified as a PFIC.  We believe that we were not a PFIC for our fiscal year
ended June 30,2019. However,
under the PFIC rules income and assets are require to be measured and
classified in accordance with U.S. federal income tax principles. Our analysis
is based on our financial statements as prepared in accordance with IFRS, which
may substantially differ from U.S. federal income tax principles. Therefore, no
assurance can be given that we were not a PFIC. Furthermore, the tests for
determining whether we would be a PFIC for any taxable year are applied
annually and it is difficult to make accurate predictions of future income and
assets, which are relevant to this determination. In addition, certain factors
in the PFIC determination, such as reductions in the market value of our
capital stock, are not within our control and can cause us to become a PFIC.
Accordingly, there can be no assurance that we will not become a PFIC.  The rules relating to PFICs are very complex. U.S. holders
are urged to consult their tax advisors regarding the application of the PFIC
rules to their investments in our ordinary shares or ADSs.  Disposition of Ordinary Shares or ADSs  Subject to the discussion above under the
heading “Passive Foreign Investment Company”, upon a sale, exchange, or other
taxable disposition of ordinary shares or ADSs, a U.S. holder will recognize
gain or loss in an amount equal to the difference between the U.S. dollar value
of the amount realized on the sale or exchange and such holder's adjusted tax
basis in the ordinary shares or ADSs. Subject to the application of the
“passive foreign investment company” rules discussed above, such gain or loss
generally will be capital gain or loss and will be long-term capital gain or
loss if the U.S. holder has held the ordinary shares or ADSs for more than one
year. The deductibility of capital losses is subject to limitations. Gain or
loss recognized by a U.S. holder on the taxable disposition of ordinary shares
or ADSs generally will be treated as U.S.‐source gain or loss for U.S. foreign
tax credit purposes.    74


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In the case of a cash basis U.S. holder
who receives rands in connection with the taxable disposition of ordinary
shares or ADSs, the amount realized will be based on the spot rate as
determined on the settlement date of such exchange. A U.S. holder who receives
payment in rand and converts rand into U.S. dollars at a conversion rate other
than the rate in effect on the settlement date may have a foreign currency
exchange gain or loss that would be treated as ordinary income or loss.  An accrual basis U.S. holder may elect
the same treatment required of cash basis taxpayers with respect to a taxable
disposition of ordinary shares or ADSs, provided that the election is applied
consistently from year to year. Such election may not be changed without the
consent of the Internal Revenue Service. In the event that an accrual basis
holder does not elect to be treated as a cash basis taxpayer, such U.S. holder
may have a foreign currency gain or loss for U.S. federal income tax purposes
because of the differences between the U.S. dollar value of the currency
received prevailing on the trade date and the settlement date. Any such
currency gain or loss will be treated as ordinary income or loss and would be
in addition to gain or loss, if any, recognized by such U.S. holder on the
disposition of such ordinary shares or ADSs.  Information
with respect to Foreign Financial Assets  Certain
U.S. holders may be required to report on Internal Revenue Service Form 8938
information relating to an interest in ordinary shares or ADSs, subject to
certain exceptions (including an exception for assets held in accounts
maintained by certain financial institutions, although the account itself may
be reportable if held at a non-U.S. financial institution). U.S. holders should
consult their tax advisers regarding the effect, if any, of this reporting
requirement on their acquisition, ownership and disposition of ordinary shares
or ADSs. U.S. holders should consult their tax advisors regarding application
of the information reporting and backup withholding rules.  10F. DIVIDENDS AND PAYING AGENTS  Not applicable  10G. STATEMENT BY EXPERTS  Not applicable.  10H. DOCUMENTS ON DISPLAY  DRDGOLD files annual reports on Form 20-F
and reports on Form 6-K with the SEC. You may access this information at the
SEC’s home page (http://www.sec.gov). Copies of the documents referred to
herein may be inspected at DRDGOLD Limited’s offices by contacting DRDGOLD
Limited, P.O. Box 390, Maraisburg, Johannesburg, South Africa 1700. Attn:
Company Secretary. Tel No. +27-11-470-2600.  10I. SUBSIDIARY INFORMATION  Not applicable.  ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK  General  In
the normal course of our operations, we are exposed to market risk, including
commodity price, foreign currency, interest and credit risks. Refer to Item 18.
‘‘Financial Statements - Note 27 - Financial instruments’’ of the consolidated
financial statements for a qualitative and quantitative discussion of our
exposure to these market risks.  Our long-term strategy is to remain unhedged and to keep
borrowings to a minimum. During fiscal 2019 we do not hold or issue derivative
financial instruments for speculative purposes, nor did we hedge forward gold
sales.However, in instances where we need to incur medium-term borrowings
to finance growth projects that introduce some liquidity risk to the Group, we
may mitigate this liquidity risk by entering into an arrangement to provide
price protection against a possible decrease in the Rand gold price while
borrowings are in place.For example in fiscal 2019 we entered into a hedging
instrument in the form of a collar in respect of 50,000 ounces of gold that
expired at the end of May 2019.  Commodity
price risk  The
rand market price of gold has a significant effect on our results of
operations, our ability and the ability of our subsidiaries to pay dividends
and undertake capital expenditures, and the market price of our ordinary shares
or ADSs. Historically, rand gold prices have fluctuated widely and are affected
by numerous industry factors over which we have no control. The aggregate
effect of these factors on the rand gold price is impossible for us to predict.
The rand price of gold may not remain at a level allowing us to economically
exploit our reserves.  It
is our long-term policy not to hedge this commodity price risk. However, in
instances where we need to incur medium-term borrowings to finance growth
projects that introduce some liquidity risk to the Group, we may mitigate this liquidity
risk by entering into an arrangement to provide price protection against a
possible decrease in the Rand gold price while borrowings are in place.For example in fiscal
2019 we entered into a hedging instrument in the form of a collar in respect of
50,000 ounces of gold that expired at the end of May 2019.  Concentration of credit risk  Credit risk is the risk of financial loss to us if a
customer or counterparty to a financial instrument fails to meet its
contractual obligations, and arises principally from our receivables from
customers and investment securities.  75


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The Group manages its exposure to credit
risk on trade receivables by maintaining a short term cycle to settlement of 2
days. The Group manages its exposure to credit risk on other receivables by
dealing with a number of counterparties, ensuring that these counterparties are
of good credit standing and transacting on a secured or cash basis where
considered required. Receivables are regularly monitored and assessed for
recoverability.  Foreign
currency risk  Our
reporting currency is South African rand. Although gold is sold in US dollars,
the Company is obliged to convert this into rands. We are thus exposed to
fluctuations in the US dollar/rand exchange rate. Foreign exchange fluctuations
affect the cash flow that we will realize from our operations as gold is sold
in US dollars, while production costs are incurred primarily in rands. Our
results are positively affected when the US dollar strengthens against the rand
and adversely affected when the US dollar weakens against the rand. Our cash
and cash equivalent balances are held in US dollars and rands. Holdings
denominated in other currencies are insignificant.  Long-term debtSet out below is an analysis of our debt as at June 30, 2019.
  All of our long-term debt is denominated in South African rand.Interest
  rateFixed
  rate
 
 
 17.90%Weighted
  average interest rate
 
 
 17.90%R'mRepayment
  period2020
 
 
 11.0Based on our fiscal year 2019 financial results, a hypothetical
  100 basis points (increase)/decrease in interest rate activity would (increase)/decrease
  our interest expense by R0.1 million.
 76


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ITEM 12.
DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES  12A. DEBT SECURITIES  Not applicable. 12B. WARRANTS AND RIGHTS  Not applicable.  12C. OTHER SECURITIES  Not applicable.  12D. AMERICAN DEPOSITARY SHARES  Depositary
Fees and Charges  DRDGOLD’s
American Depository Shares, or ADSs, each representing ten of DRDGOLD’s
ordinary shares, are traded on the New York Stock Exchange, or NYSE under the
symbol “DRD” (until December 29, 2011 our ADSs were traded on the Nasdaq
Capital Market under the symbol “DROOY”). The ADSs are evidenced by American
Depository Receipts, or ADRs, issued by The Bank of New York Mellon, as
Depository under the Amended and Restated Deposit Agreement dated as of August
12, 1996, as amended and restated as of October 2, 1996, as further amended and
restated as of August 6, 1998, as further amended and restated July 23, 2007,
among DRDGOLD Limited, The Bank of New York Mellon and owners and beneficial
owners of ADRs from time to time. ADR holders may have to pay the following
service fees to the Depositary:  Service
 
 Fees (USD)Issuance
  of ADSs, including issuances resulting from a distribution of ordinary shares
  or rights
 $5.00 (or less) per 100 ADSs (or portion thereof)1Cancellation
  of ADSs for the purpose of withdrawal, including if the Deposit Agreement
  terminates
 $5.00 (or less) per 100 ADSs (or portion thereof)1Distribution
  of cash dividends or other cash distributions
 2 cents (or less) per ADS (or portion thereof)Distribution
  of securities distributed to holders of deposited securities which are
  distributed by the Depositary to ADS registered holders
 $5.00 (or less) per 100 ADSs (or portion thereof)In
  addition, ADR holders are responsible for certain fees and expenses incurred
  by the Depositary on their behalf including (1) taxes and othergovernmental
  charges, (2) such registration fees as may from time to time be in effect for
  the registration of transfers of ordinary shares generally on the share
  register and applicable to transfers of ordinary shares to the name of the
  Depositary or its nominee or the Custodian or its nominee on the making of
  deposits or withdrawals, (3) such cable, telex and facsimile transmission
  expenses as are expressly provided in the Deposit Agreement, and (4) such
  expenses as are incurred by the Depositary in the conversion of foreign
  currency to U.S. Dollars.[1]These fees are typically paid to the
  Depositary by the brokers on behalf of their clients receiving the
  newly-issued ADSs from the Depositary or delivering the ADSs to the
  Depositary for cancellation. The brokers in turn charge these transaction
  fees to their clients.
 The Depositary collects its fees for delivery and
surrender of ADSs directly from investors depositing or surrendering ADSs for
the purpose of withdrawal or from intermediaries acting for them. The
Depositary, collects fees for making distributions to investors by deducting
those fees from the amounts distributed or by selling a portion of
distributable property to pay the fees. The Depositary may collect its annual
fee for depositary services by deductions from cash distributions or by
directly billing investors or by charging the book-entry system accounts of
participants acting for them. The Depositary may generally refuse to provide
fee-attracting services until its fees for those services are paid.  Depositary Payments  The Bank of New York Mellon, as Depositary, has agreed to
reimburse DRDGOLD an annual amount of $75,000 mainly consisting of accumulated
contributions towards the Company’s investor relations activities (including
investor meetings, conferences and fees of investor relations service vendors).
After the deduction of other fees, the annual reimbursement for the year ended June
30, 2019 amounts to approximately $16,237 (June 30, 2018: $5,974, (June 30, 2017:
$44,509). DRDGOLD is also entitled to a 25% share of the dividend fees which
amounts to approximately $nil for the year ended June 30, 2019 (June 30, 2018: $20,195). 77


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PART II ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES  There have been no
material defaults in the payment of principal, interest, a sinking or purchase
fund installment, or any other material defaults with respect to any
indebtedness of ours.  ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS
AND USE OF PROCEEDS  Not applicable.  ITEM 15. CONTROLS
AND PROCEDURES  15A. Disclosure
Controls and Procedures  As of
June 30, 2019, our management, with the participation of our Chief Executive
Officer and Chief Financial Officer have evaluated the effectiveness of our
disclosure controls and procedures (as this term is defined in Rules 13a-15(e)
and 15d-15(e) of the Exchange Act). Our management, including the Chief
Executive Officer and Chief Financial Officer, concluded that our disclosure
controls and procedures were effective as of June 30, 2019.  Our
disclosure controls and procedures are designed to provide reasonable assurance
that information required to be disclosed by us in the reports that we file or
submit under the Securities Exchange Act of 1934 is recorded, processed,
summarized and reported, within the time periods specified in the applicable
rules and forms and that such information required to be disclosed by us in the
reports we file or submit under the Securities Exchange Act is accumulated and
communicated to our management, including our Chief Executive Officer and Chief
Financial Officer, as appropriate to allow timely decisions regarding required
disclosures.  There
are inherent limitations in the effectiveness of any system of disclosure
controls and procedures. These limitations include the possibility of human
error and the circumvention or overriding of the controls and procedures.
Accordingly, any such system can only provide reasonable assurance of achieving
the desired control objectives.  15B. Management’s
Annual Report on Internal Control Over Financial Reporting  Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting. Internal control over financial reporting is
defined in Rule 13a-15(f) or 15d-15(f) promulgated under the Securities
Exchange Act of 1934 as a process designed by, or under the supervision of, our
Chief Executive Officer and Chief Financial Officer and effected by our board,
management and other personnel to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of financial statements
for external purposes in accordance with IFRS. Under Section 404 of the Sarbanes
Oxley Act of 2002, management is required to assess our internal controls
surrounding the financial reporting process as at the end of each fiscal year.
Based on that assessment, management is to determine whether or not our
internal controls over financial reporting are effective.  Internal
control over financial reporting includes those policies and procedures that:  ·pertain
to the maintenance of records that in reasonable detail accurately and fairly
reflect the transactions and dispositions of our assets; ·provide
reasonable assurance that transactions are recorded as necessary to permit
preparation of financial statements in accordance with IFRS, and that our
receipts and expenditures are being made only in accordance with authorizations
of our management and board; and ·provide
reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use or disposition of our assets that could have a material effect
on our financial statements.  Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements. Instead, it must be noted that even those
systems that management deems to be effective can only provide reasonable
assurance with respect to the preparation and presentation of our financial
statements. Also, projections of any evaluation of effectiveness to future
periods are subject to the risk that controls may become inadequate because of
changes in conditions, or the degree of compliance with the policies and
procedures.  Our
management assessed the effectiveness of our internal control over financial
reporting as of June 30, 2019. In making this assessment, our
management used the criteria set forth by theInternal Control-Integrated
Framework (2013)issued by the Committee of Sponsoring Organizations of the
Treadway Commission (COSO). Based on our assessment and those criteria, our
management concluded that as of June 30, 2019 our internal control over
financial reporting was effective.  15C. Attestation Report of the independent registered public accounting
firm  The
effectiveness of internal control over financial reporting as of June 30, 2019
was audited by KPMG Inc., independent registered public accounting firm, as
stated in their report on page F-1 of this Form 20-F.  15D. Changes in Internal Control Over Financial Reporting  Changes
that have materially affected, or are reasonably likely to materially affect,
our internal control over financial reporting during the period covered by the
annual report, need to be identified and reported as required by paragraph (d)
of Rule 13a-15. 78


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During
the year ended June 30, 2019, there have not been any changes in our internal
control over financial reporting that have materially affected, or are
reasonably likely to materially affect, our internal control over financial
reporting.  ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT  Mr. J.A.Holtzhausen,
Chairman of the Audit and Risk Committee, has been determined by our board to
be an audit committee financial expert within the meaning of the Sarbanes-Oxley
Act, in accordance with the Rules of the New York Stock Exchange, or NYSE,and rules promulgated by the SEC
andindependent both under the New York
Stock Exchange Rules and the South African Johannesburg Stock Exchange Rules.
The board is satisfied that the skills, experience and attributes of the
members of the audit and risk committee are sufficient to enable those members
to discharge the responsibilities of the audit and risk committee.  ITEM 16B. CODE OF ETHICS  We
have adopted a Code of Conduct that applies to all senior executives including
our Non-Executive Chairman, the Chief Executive Officer, Chief Financial
Officer, Chief Operating Officer and the Financial Director at our mining
operation as well as all other employees. The Code of Conduct can be accessed
on the Company’s website at the following web address: www.drdgold.com/about-us/governance.   ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES  KPMG Inc. has
served as our independently registered public accountant for the fiscal years
ended June 30, 2019, 2018 and 2017, for which audited financial statements
appear in this Annual Report. The Annual General Meeting elects the auditors
annually.  The
following table presents the aggregate fees for professional audit services and
other services rendered by KPMG Inc. to us in fiscal year 2019 and 2018:  Audit Fees  Audit fees billed for the annual audit services
engagement, which are those services that the external auditor reasonably can
provide, include the company audit; statutory audits; comfort letters and
consents; attest services; and assistance with and review of documents filed
with the SEC.  Auditors'
  remuneration
 Year ended June 30,2019
 2018R m
 R mAudit
  fees
 8.3
 5.7All
  other fees
 1.0
 1.7Total
 9.3
 7.4
  All
Other Fees  The
all other fees during fiscal year 2019 consist of the following: ·R0.4
million with respect to limited assurance provided by KPMG on specified items
contained in our Integrated Report for fiscal year 2018; ·R0.1
million with respect to limited assurance provided by KPMG on specified items
contained in our Integrated Report for fiscal year 2019; ·R0.5
million with respect to agreed-upon procedures performed by KPMG on the eXtensible
Business Reporting Language (XBRL) interactive data file related to the form
20-F for fiscal year 2018;  The
all other fees paid during fiscal year 2018 consist of fees invoiced with
respect to limited assurance provided by KPMG on specified items contained in
our Integrated Report for fiscal year 2017. Subsequent to June 30, 2019, the
remainder of the limited assurance on specified items contained in our
Integrated Report for fiscal year 2019 amounting to R0.3 million was rendered
and billed during fiscal year 2020.  The
Audit and Risk Committee is directly responsible for recommending the
appointment, re-appointment and removal of the external auditors as well as the
remuneration and terms of engagement of the external auditors. The committee
pre-approves, and has pre-approved, all non-audit services provided by the
external auditors. TheAudit and Risk
Committee considered all of the fees mentioned above and determined that such
fees are compatible with maintaining KPMG Inc.’s independence.  79


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ITEM 16D. EXEMPTIONS FROM THE
LISTING STANDARDS FOR AUDIT COMMITTEES  Not applicable.  ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED
PURCHASERS  Period
 (a) Total Number of Shares
  Purchased
 (b) Average Price Paid per Share
 (c) Total Number of Shares
  Purchased as Part of Publicly Announced Plans or Programs
 (d) Maximum Number (or Approximate
  Dollar Value) of Shares that May Yet Be Purchased Under the Plans or Programs5,000,000May, 23 – May, 31
 53,894
 2.59
 53,894
 4,860,609June, 3 – June, 11
 60,000
 2.76
 60,000
 4,694,872
  The Company has established a share repurchase programme
in terms of which the Company and / or its subsidiaries may repurchase up to5
million DRDGOLD ordinary shares, being 0.7% of the Company ́s issued share
capital, for an aggregate consideration not exceeding R14 million ("Repurchase
Programme").  The
Repurchase Programme commenced on May 22, 2019 and will terminate on the date
of the next annual general meeting of the Company or February 29, 2020,
whichever is the earlier date.  DRDGOLD
ordinary shares purchased under the Repurchase Programme may not be made at a
price greater than 10% above the volume weighted average trading price of
DRDGOLD ordinary shares over the five trading days immediately preceding any
particular repurchase and are effected through the order book operated by the
JSE Limited, without any prior understanding or arrangement between the Company
and / or its subsidiaries and the counterparties.  The
Repurchase Programme may be discontinued at any time and the Company and / or
its subsidiaries have no obligation to repurchase any amount of DRDGOLD
ordinary shares under the Repurchase Programme. ITEM 16F. CHANGE IN REGISTRANT'S CERTIFYING ACCOUNTANT  Not applicable.  ITEM 16G. CORPORATE GOVERNANCE  As a foreign private
issuer with shares listed on the NYSE, we are subject to corporate governance
requirements imposed by NYSE. Under section 303A.11 of the NYSE Listing
Standards, a foreign private issuer such as us may follow its home country
corporate governance practices in lieu of certain of the NYSE Listing Standards
on corporate governance. The following paragraphs summarize the significant
differences between these various requirements and how it is implemented by
DRDGOLD:  Shareholder
meeting quorum requirements  Section 310.00 of the NYSE Listing Standards provides
that the quorum required for any meeting of holders of common stock should be
sufficiently high to insure a representative vote. Consistent with the practice
of companies incorporated in South Africa, our Memorandum of Incorporation
requires a quorum of three members present with sufficient voting powers in
person or by proxy to exercise in aggregate 25% of the voting rights and we
have elected to follow our home country rule.  ITEM 16H. MINE
SAFETY DISCLOSURES Not
applicable. 80


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PART III  ITEM 17. FINANCIAL STATEMENTS  Not applicable.  ITEM 18 FINANCIAL STATEMENTSThe following annual financial statements and related auditor’s
  reports are filed as part of this Annual Report
 PageReport of the Independent Registered Public Accounting Firm
 F‐1Consolidated statement of profit or loss and other comprehensive
  income for the years ended June 30, 2019, 2018 and 2017
 F-3Consolidated statement of financial position at June 30, 2019
  and 2018
 F‐4Consolidated statement of changes in equity for the years ended
  June 30, 2019, 2018 and 2017
 F‐5Consolidated statement of cash flows for the years ended June
  30, 2019, 2018 and 2017
 F‐4Notes to the financial statements
 F‐1 to F‐29About these consolidated financial statements
 1Use of accounting assumptions, estimates and judgements
 2New standards, amendments to standards and interpretations not
  yet adopted
 3PerformanceRevenue
 5Results from operating activities
 6Cost of sales
 6.1Other income
 6.2Administration expenses and other costs
 6Finance income
 7Finance expense
 8Earnings per share
 9Resource assets and related liabilitiesProperty, plant and equipment
 10Provision for environmental rehabilitation
 11Investment in rehabilitation obligation funds
 12Working capitalCash and cash equivalents
 13Cash generated by operations
 14Trade and other receivables
 15Trade and other payables
 16Inventories
 17TaxIncome tax
 18Income tax expense
 18.1Deferred tax
 18.2Employee mattersEmployee benefits
 19Liability for long term incentive scheme
 19.1Transactions with key management personnel
 19.2Capital and equityCapital management
 20Equity
 21Borrowings
 22Disclosure itemsOperating segments
 23Interest in subsidiaries
 24Other Assets
 25Payments made under protest
 25.1Investments in other entities
 25.2Contingent assets and liabilities
 26Financial instruments
 27Related parties
 28Subsequent events
 29
 81


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82


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Report of Independent Registered Public Accounting
Firm To the Shareholders
and Board of Directors DRDGOLD Limited: Opinions
on the Consolidated Financial Statements and Internal Control over Financial
Reporting We have
audited the accompanying consolidated statements of financial position of
DRDGOLD Limited and subsidiaries (the Company) as of June 30, 2019 and 2018, the
related consolidated statements of profit or loss and other comprehensive
income, changes in equity, and cash flows for each of the years in the
three-year period ended June 30, 2019, and the related notes (collectively, the
consolidated financial statements). We also have audited the Company’s internal
control over financial reporting as of June 30, 2019, based on criteria
established in Internal Control – Integrated Framework (2013) issued by the
Committee of Sponsoring Organizations of the Treadway Commission. In our
opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of the Company as of June
30, 2019 and 2018, and the results of its operations and its cash flows for
each of the years in the three-year period ended June 30, 2019, in conformity
with International Financial Reporting Standards as issued by the International
Accounting Standards Board. Also in our opinion, the Company maintained, in all
material respects, effective internal control over financial reporting as of
June 30, 2019 based on criteria established in Internal Control – Integrated
Framework (2013) issued by the Committee of Sponsoring Organizations of the
Treadway Commission. Basis
for Opinions The
Company’s management is responsible for these consolidated financial
statements, for maintaining effective internal control over financial
reporting, and for its assessment of the effectiveness of internal control over
financial reporting, included in the accompanying Management’s Annual Report on
Internal Control over Financial Reporting. Our responsibility is to express an
opinion on the Company’s consolidated financial statements and an opinion on
the Company’s internal control over financial reporting based on our audits. We
are a public accounting firm registered with the Public Company Accounting
Oversight Board (United States) (PCAOB) and are required to be independent with
respect to the Company in accordance with the U.S. federal securities laws and
the applicable rules and regulations of the Securities and Exchange Commission
and the PCAOB. We
conducted our audits in accordance with the standards of the PCAOB. Those
standards require that we plan and perform the audits to obtain reasonable
assurance about whether the consolidated financial statements are free of
material misstatement, whether due to error or fraud, and whether effective
internal control over financial reporting was maintained in all material
respects. Our
audits of the consolidated financial statements included performing procedures
to assess the risks of material misstatement of the consolidated financial
statements, whether due to error or fraud, and performing procedures that
respond to those risks. Such procedures included examining, on a test basis,
evidence regarding the amounts and disclosures in the consolidated financial
statements. Our audits also included evaluating the accounting principles used
and significant estimates made by management, as well as evaluating the overall
presentation of the consolidated financial statements. Our audit of internal
control over financial reporting included obtaining an understanding of
internal control over financial reporting, assessing the risk that a material
weakness exists, and testing and evaluating the design and operating
effectiveness of internal control based on the assessed risk. Our audits also
included performing such other procedures as we considered necessary in the
circumstances. We believe that our audits provide a reasonable basis for our
opinions. Definition
and Limitations of Internal Control over Financial Reporting A
company’s internal control over financial reporting is a process designed to
provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles. A company’s internal control
over financial reporting includes those policies and procedures that (1)
pertain to the maintenance of records that, in reasonable detail, accurately
and fairly reflect the transactions and dispositions of the assets of the
company; (2) provide reasonable assurance that transactions are recorded as
necessary to permit preparation of financial statements in accordance with
generally accepted accounting principles, and that receipts and expenditures of
the company are being made only in accordance with authorizations of management
and directors of the company; and (3) provide reasonable assurance regarding
prevention or timely detection of unauthorized acquisition, use, or disposition
of the company’s assets that could have a material effect on the financial
statements. Because
of its inherent limitations, internal control over financial reporting may not
prevent or detect misstatements. Also, projections of any evaluation of
effectiveness to future periods are subject to the risk that controls may
become inadequate because of changes in conditions, or that the degree of
compliance with the policies or procedures may deteriorate.   /s/ KPMG
Inc. We have
served as the Company’s auditor since 2003. Johannesburg,
Republic of South Africa October
31, 2019   83


---

Amounts
  in R million
 Note
 2019
 2018
 2017Revenue
 5
 2,762.1
 2,490.4
 2,339.9Cost
  of sales
 6.1
 (2,553.9)
 (2,347.7)
 (2,307.9)Gross
  profit from operating activities
 
 208.2
 142.7
 32.0Other
  income
 6.2
 7.9
 -
 12.9Administration
  expenses and other costs
 6.3
 (90.9)
 (90.7)
 (69.4)Results
  from operating activities
 
 125.2
 52.0
 (24.5)Finance
  income
 7
 58.3
 38.8
 40.0Finance
  expense
 8
 (78.4)
 (58.4)
 (52.2)Profit
  before tax
 
 105.1
 32.4
 (36.7)Income
  tax
 18.1
 (26.6)
 (25.9)
 50.4Profit
  for the year
 
 78.5
 6.5
 13.7Other
  comprehensive incomeItems
  that will not be reclassified to profit or loss, net of taxNet
  fair value adjustment on equity investments at fair value through other
  comprehensive income
 25.2
 (5.9)
 -
 -Items
  that will be reclassified subsequently to profit or loss, net of taxNet
  fair value adjustment on available-for-sale investments
 25.2
 -
 0.6
 0.3Total
  other comprehensive income for the year
 
 (5.9)
 0.6
 0.3Total
  comprehensive income for the year
 
 72.6
 7.1
 14.0Earnings
  per shareBasic
  earnings per share (SA cents per share)
 9
 11.8
 1.5
 3.2Diluted
  earnings per share (SA cents per share)
 9
 11.5
 1.5
 3.2The
  accompanying notes are an integral part of these consolidated financial
  statements.
 84


---

Amounts
  in R million
 Note
 2019
 2018ASSETSNon-current
  assets
 
 3,403.9
 1,734.1Property,
  plant and equipment
 10
 2,775.3
 1,452.7Investments
  in rehabilitation obligation funds
 12
 587.5
 244.0Other
  assets
 25
 31.1
 28.7Deferred
  tax asset
 18.2
 10.0
 8.7Current
  assets
 
 656.1
 626.3Inventories
 17
 304.6
 233.0Current
  tax receivable
 
 4.1
 -Trade
  and other receivables
 15
 67.9
 91.2Cash
  and cash equivalents
 13
 279.5
 302.1TOTAL
  ASSETS
 
 4,060.0
 2,360.4EQUITY
  AND LIABILITIESEquity
 
 2,688.6
 1,267.3Stated
  share capital
 21.1
 5,072.8
 4,177.7Other
  reserves
 
 453.6
 -Retained
  earnings
 
 (2,837.8)
 (2,910.4)Non-current
  liabilities
 
 913.2
 772.4Provision
  for environmental rehabilitation
 11
 682.6
 553.4Deferred
  tax liability
 18.2
 193.2
 163.7Employee
  benefits
 19
 37.4
 40.6Finance
  lease obligation
 10
 -
 14.7Current
  liabilities
 
 458.2
 320.7Trade
  and other payables
 16
 419.2
 303.3Employee
  benefits
 19
 22.6
 13.2Finance
  lease obligation
 10
 11.0
 -Current
  tax liability
 
 5.4
 4.2TOTAL
  LIABILITIES
 
 1,371.4
 1,093.1TOTAL
  EQUITY AND LIABILITIES
 
 4,060.0
 2,360.4The
  accompanying notes are an integral part of these consolidated financial
  statements.
 85


---

Statedshare
 Other
 Retained
 TotalAmounts
  in R million
 Note
 capital
 reserves1
 earnings
 equityBalance
  at June 30, 2016
 
 4,177.7
 140.2
 (2,978.3)
 1,339.6Total
  comprehensive incomeProfit
  for the year
 
 
 
 13.7
 13.7Other
  comprehensive income
 25.2
 
 
 (0.3)
 (0.3)Transactions
  with the owners of the parentDividend
  on ordinary share capital
 21.2
 
 
 (50.6)
 (50.6)Available
  for sale and other reserves transferred to retained earnings
 
 
 (140.2)
 140.2
 -Balance
  at June 30, 2017
 
 4,177.7
 -
 (2,875.3)
 1,302.4Total
  comprehensive incomeProfit
  for the year
 
 
 
 6.5
 6.5Other
  comprehensive income
 25.2
 
 
 0.6
 0.6Transactions
  with the owners of the parentDividend
  on ordinary share capital
 21.2
 
 
 (42.2)
 (42.2)Balance
  at June 30, 2018
 
 4,177.7
 -
 (2,910.4)
 1,267.3Total
  comprehensive incomeProfit
  for the year
 
 
 
 78.5
 78.5Other
  comprehensive income
 25.2
 
 
 (5.9)
 (5.9)Transactions
  with the owners of the parentEquity
  instruments issued as purchase consideration for the FWGR Acquisition
 4
 895.7
 453.6
 
 1,349.3Share
  issue expenses
 
 (0.3)
 
 
 (0.3)Treasury
  shares acquired through subsidiary
 21.1
 (0.3)
 
 
 (0.3)Balance
  at June 30, 2019
 
 5,072.8
 453.6
 (2,837.8)
 2,688.6Note
 
 21.11 Other
  reserves include share-based payment reserve and shareholder contribution
  reserve (refer note 4)The
  accompanying notes are an integral part of these consolidated financial
  statements.
 86


---

Amounts
  in R million
 Note
 2019
 2018
 2017CASH
  FLOWS FROM OPERATING ACTIVITIESCash
  generated from operations
 14
 282.0
 222.9
 21.5Finance
  income received
 
 16.8
 21.9
 23.8Finance
  expenses paid
 
 (9.3)
 (3.5)
 (3.7)Income
  tax paid
 
 (1.2)
 (7.5)
 10.0Net
  cash inflow from operating activities
 
 288.3
 233.8
 51.6CASH
  FLOWS FROM INVESTING ACTIVITIESAcquisition
  of property, plant and equipment
 
 (347.4)
 (125.9)
 (110.6)Environmental
  rehabilitation payments to reduce decommissioning liabilities
 11
 (16.6)
 (21.5)
 (11.6)Proceeds
  on disposal of property, plant and equipment
 6.2
 5.8
 7.0
 20.5Funds
  received from environmental obligation funds
 12
 55.2
 -
 -Other
 
 -
 -
 5.0Net
  cash outflow from investing activities
 
 (303.0)
 (140.4)
 (96.7)CASH
  FLOWS FROM FINANCING ACTIVITIESBorrowings
  raised
 22
 192.0
 -
 -Borrowings
  paid
 22
 (192.0)
 -
 -Initial
  fees incurred on borrowings
 22
 (3.6)
 -
 -Repayment
  of finance lease obligation
 
 (3.7)
 (2.8)
 (2.4)Share
  issue expenses
 
 (0.3)
 -
 -Acquisition
  of treasury shares
 21.1
 (0.3)
 -
 -Dividends
  paid on ordinary share capital
 21.2
 -
 (42.2)
 (50.6)Net
  cash outflow from financing activities
 
 (7.9)
 (45.0)
 (53.0)NET
  (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS
 
 (22.6)
 48.4
 (98.1)Cash
  and cash equivalents at the beginning of the year
 
 302.1
 253.7
 351.8CASH
  AND CASH EQUIVALENTS AT THE END OF THE YEAR
 13
 279.5
 302.1
 253.7The
  accompanying notes are an integral part of these consolidated financial
  statements.
  87


---

1  ABOUT THESE
CONSOLIDATED FINANCIAL STATEMENTS  Reporting entity The DRDGOLD Group is primarily involved in the retreatment of
surface gold. The consolidated financial statements comprise the Company and
its subsidiaries who are all wholly owned subsidiaries and solely operates in
South Africa (collectively the “Group” and individually “Group
Companies”). DRDGOLD Limited is domiciled in South Africa with a
registration number of 1895/000926/06. The registered address of the company is
1 Sixty Jan Smuts Building, 2nd Floor - North Tower, 160 Jan Smuts Avenue,
Rosebank, 2196.  Basis of
accounting The
consolidated financial statements have been prepared in accordance with
International Financial Reporting Standards (IFRS) and its interpretations
adopted by the International Accounting Standards Board (IASB). The consolidated financial
statements were approved by the board for issuance onOctober 31,
2019. Functional
and presentation currency The functional and reporting currency of DRDGOLD and its
subsidiaries is South African rand. The amounts in these consolidated financial
statements are rounded to the nearest million unless stated otherwise.
Significant exchange rates applied during the year are set out in the table
below:  South
  African rand / US dollar
 2019
 2018
 2017Spot
  rate at year end
 14.07
 13.72
 13.05Average
  rate for the financial year
 14.18
 12.85
 13.59
  Basis of measurement The consolidated
financial statements are prepared on the historical cost basis, unless
otherwise stated. Basis of consolidation Subsidiaries Subsidiaries are entities
controlled by the Group. The Group controls an entity when it is exposed to, or
has rights to, variable returns from its involvement with the entity and has
the ability to affect those returns through its power over the entity. The
financial statements of subsidiaries are included in the consolidated financial
statements from the date that control commences until the date that control
ceases. Transactions eliminated on
consolidation Intra-group balances, transactions
and any unrealised gains and losses or income and expenses arising from
intra-group transactions, are eliminated in preparing the consolidated
financial statements.  2   USE OF
ACCOUNTING ASSUMPTIONS, ESTIMATES AND JUDGEMENTS The
preparation of the consolidated financial statements requires management to
make accounting assumptions, estimates and judgements that affect the
application of the Group's accounting policies and reported amounts of assets
and liabilities, income and expenses.  Accounting assumptions, estimates and judgements are reviewed on
an ongoing basis. Revisions to reported amounts are recognised in the period in
which the revision is made and in any future periods affected. Actual results
may differ from these estimates.  Information about assumptions and estimates in applying accounting
policies that have the most significant effect on the amounts recognised in the
consolidated financial statements are included in the notes: NOTE 4        ACQUISITION OF ASSETS AND LIABILITIES NOTE 10      PROPERTY, PLANT AND EQUIPMENT NOTE 11      PROVISION FOR ENVIRONMENTAL REHABILITATION NOTE 18      INCOME TAX NOTE 25.1   PAYMENTS MADE UNDER PROTEST  Information about significant judgements in applying accounting
policies that have the most significant effect on the amounts recognised in the
consolidated financial statements are included in the notes: NOTE 4        ACQUISITION OF ASSETS AND LIABILITIES NOTE 10      PROPERTY, PLANT AND EQUIPMENT NOTE 25.1   PAYMENTS MADE UNDER PROTEST NOTE 26      CONTINGENT ASSETS AND LIABILITIES  88


---

3     NEW
STANDARDS, AMENDMENTS TO STANDARDS AND INTERPRETATIONS NOT YET ADOPTED  New standards, amendments to standards and interpretations
effective for the year ended 30 June 2019  During the financial
period, the following new and revised accounting standards, amendments to
standards and new interpretation were adopted by the Group:  IFRS 2
Share-based payment amendments (Effective date 1 July 2018) The amendment
to IFRS 2 did not have an impact on the Group as market and non-vesting
conditions are being taken into account in measuring its fair value and the
number of awards to receive cash is already adjusted to reflect the best
estimate of those expected to vest as a result of satisfying service and any
non-market performance conditions. IFRS 9
Financial Instruments (Effective date 1 July 2018) The standard sets out
requirements for recognising and measuring financial instruments. It also
introduced three new classifications for financial assets: Amortised cost, fair
value through profit or loss and fair value through other comprehensive income.
The following changes have occurred as a result:  Classification and
measurement of financial assets and financial liabilities  There are 3 categories of
financial assets under IFRS 9: Financial assets at amortised cost, fair value
through profit or loss and fair value through other comprehensive income. These
categories replace the following categories under IAS 39: Held to maturity,
loans and receivables and available for sale. There have been no significant
changes to the measurement of financial liabilities.  This has had the
following impact on the Group: ·investments in listed and unlisted
shares have been designated as equity instruments at fair value through other
comprehensive income. As a result fair value adjustments for the current year
are included and presented in other comprehensive income as items that will not
be reclassified to profit or loss(refer to note25.2)
unlike previously permitted under IAS 39. A significant consideration made in
making this designation is that it is the DRDGOLD’s business model to retain an
interest in the entities for strategic reasons rather than for trade. As such
IFRS 9’s new requirement in making such a designation that changes in fair
value of the investment will never find their way into profit or loss would be
appropriate; ·there has been no change
in the accounting of other financial assets and financial liabilities as a
result of the new classifications under IFRS 9. The Group has the following
other financialassets: ☐Cash and cash equivalents included in environmental rehabilitation
obligation funds (refer note12) for nature thereof; ☐Cash and cash equivalents (refer note13) for nature thereof; and ☐Trade and other receivables (refer note 15) for nature thereof;  The business model of the Group is to hold these financial assets
to obtain payment in accordance with the contract with the counterparty and
such payments comprise solely of payments of principal and interest. These
financial assets are therefore classified as financial assets measured at
amortised cost and their measurement remained largely unchanged from their
previous classifications under IAS 39. The Group does not enter into hedging
arrangements unless necessitated by increased liquidity risk brought into the
Group. There were no material hedging arrangements entered into at 1 July 2018.  The following table summarises the impact of transition to IFRS 9
on the classification of financial assets and financial liabilities at 1 July
2018:  Financial Assets
  Amounts in R million
 Note
 IAS 39 classification
 IFRS 9 classification
 Carrying amount under IAS 39
 Carrying amount under IFRS 9Cash and cash equivalents in environmental rehabilitation trust
  funds
 12
 Loans and receivables
 Financial asset at amortised cost
 118.0
 118.0Cash and cash equivalents
 13
 Loans and receivables
 Financial asset at amortised cost
 302.1
 302.1Trade and other receivables excluding Value Added Tax and
  prepayments
 15
 Loans and receivables
 Financial asset at amortised cost
 32.2
 32.2Investments in other entities
 25.2
 Available-for-sale financial assets
 Fair Value through other comprehensive income
 9.4
 9.4Total Financial Assets
 
 
 
 461.7
 461.7
   89


---

3   NEW
STANDARDS, AMENDMENTS TO STANDARDS AND INTERPRETATIONScontinued  New standards, amendments to standards and interpretations
effective for the year ended 30 June 2019continued  IFRS 9 Financial Instruments (Effective
date 1 July 2018)continued  Classification and measurement of financial assets and financial
liabilitiescontinued  Financial Liabilities
  Amounts in R million
 Note
 IAS 39 classification
 IFRS 9 classification
 Carrying amount under IAS 39
 Carrying amount under IFRS 9Trade and other payables excluding payroll accruals, accrued
  leave pay and provision for performance-based incentives
 16
 Financial liability at amortised cost
 Financial liability at amortised cost
 227,0
 227,0Total Financial Liabilities
 
 
 
 227,0
 227,0
  Impairment of Financial Assets The method of determining impairment of other receivables has
changed to reflect the “expected credit loss” model. Management has made an
assessment of the magnitude of the changes to the impairment model and although
the application of the expected credit loss model resulted in an increase in
the impairment allowance, the increase was not material for the Group.  Amounts in R millionLoss allowance as at 30 June 2018
  under IAS 39
 9.2Impairment recognised on other
  receivables at 1 July 2018 included in operating costs
 3.2Loss allowance as a 1 July 2018
  under IFRS 9
 12.4
  The Group elected to use the exemption not to restate comparative
information for prior periods with respect to classification and measurement
requirements. The standard has not had a material impact and therefore no
adjustments have been recognised in retained earnings and reserves as at 1 July
2018 and no restatement has been made.  The amended accounting policies are included in the following
notes: Note
12      INVESTMENT IN ENVIRONMENTAL REHABILITATION OBLIGATION FUNDS Note
13      CASH AND CASH EQUIVALENTS Note
15      TRADE AND OTHER RECEIVABLES Note
25.2      INVESTMENT IN OTHER ENTITIES Note
27      FINANCIAL INSTRUMENTS  IFRS 15
Revenue from contracts with customers (Effective date 1 July 2018) The standard
contains a single model that applies to contracts with customers. The Group has assessed that there is no impact on adopting IFRS 15Revenue from contracts with customers, and
revenue recognition remains unchanged as follows: • the Group only has one performance obligation
that is to deliver gold and silver to the buyer • the transaction price is based on the London Bullion
Market Association Gold and Silver price and the entire transaction price is
allocated to the one performance obligation; • Rand Refinery Limited (“Rand Refinery”) is assessed as
being an agent, selling gold and silver on behalf of the Group; and • revenue is recognised at a point in time,
i.e, on the date that control of gold and silver passess to the buyer, which is
the date on which Rand Refinery sells the gold and silver on the Group’s behalf
, i.e. the date the performance obligation is satisfied. This is the same date
as when significant risks and rewards passes under IAS 18Revenue.  The Group adopted IFRS 15 using the cumulative effect method
(without practical expedients), with the effect of initially applying this
standard recognised at the date of initial application (i.e. 1 July 2018).
Accordingly, the information presented for 2018 has not been restated, i.e., it
is presented, as previously reported, under IAS 18 and related interpretations.  A disaggregation of revenue between gold and silver and by
operating segment is presented in the following notes: Note 5        REVENUE Note 23      OPERATING SEGMENTS  90


---

3   NEW
STANDARDS, AMENDMENTS TO STANDARDS AND INTERPRETATIONScontinued  New standards, amendments to standards and interpretations not yet
effective  At the date
of authorisation of these consolidated financial statements, the following
relevant standards, amendments to standards and interpretations that may be
applicable to the business of the Group were in issue but not yet effective and
may therefore have an impact on future consolidated financial statements. These
new standards, amendments to standards and interpretations will be adopted at
their effective dates. IFRS
16 Leases (Effective date 1 July 2019) This standard
sets out the principles for recognition, measurement, presentation and
disclosures for both parties to a contract, i.e. the customer (“lessee”)
and the supplier (“lessor”). The standard supersedes the previous leases
standard, IAS 17 Leases and related interpretations. The standard has one model
for lessees which contains increased focus on the assessment of whether a
transaction is a lease. Lessees will now recognise most leases on the statement
of financial position and are required to recognise right-of-use assets and
lease liabilities arising from lease contracts with additional disclosures
about leasing arrangements. The Group
has assessed the estimated impact of adopting the standard on 1 July 2019. The Group has identified
the following material lease contracts which it is party to as a lessee, for
which a right of use assets and lease liabilities will be recognised: ·Property rentals; ·Equipment hire;and ·Vehicle fleet  Based on the
information currently available, the Group estimates that it will recognise
right of use assets and lease liabilities between R19 million and R35 million
which was calculated as follows: ·The remaining minimum
lease payments from the date of adoption to the end of the lease term; ·Applying an incremental
borrowing rate, which was mainly based on the interest charge on current
external borrowings to calculate the present value of these minimum lease
payments; and ·Various sensitivities
were performed on the incremental borrowing rate and the sensitivities
indicated no significant impact in the change in the present value The right of use asset will subsequently be measured under the
cost model as set out in IAS 16 Property, Plant and Equipment and the lease
liability will be subsequently measured at amortised cost, and therefore an
interest charge will be recognised over the lease term and the liability will
be decreased by the lease payments. This will have the effect of no longer
recognising the expenses related to the lease as operating expenses. Furthermore,
the payments of leases will no longer be classified as outflows from operating
activities but outflows from financing activities. There will be no impact on
DRDGOLD’s current debt covenant arrangement on the Revolving Credit Facility (“RCF”).  
No significant changes have been included for lessors  DRDGOLD plans to
transition to IFRS 16 by applying the modified retrospective method which has
the following implications: ·No restatement of
comparative information. Instead, the cumulative effect of initially applying
IFRS 16 will be recognised by adjusting the opening balance of retained
earnings at the date of initial application; and ·The incremental borrowing
rate used to calculate the estimated range of the lease liability is 8.31% -
12.31%.  DRDGOLD currently has one
lease classified as a finance lease under IAS 17 (refer to note 10 for further
information). DRDGOLD has elected to recognise a right of use asset measured
initially at the previous carrying amount of this lease under IAS 17 and a
lease liability measured at the previous carrying amount of the lease liability
under IAS 17. Subsequently, the lease will be accounted for IFRS 16. This lease
has been excluded in the range provided above.  DRDGOLD also plans to
recognise the right of use assets at an amount equal to the lease liability at
1 July 2019; and will apply the followingjudgements
andpractical expedients: ·Leases for which the
underlying asset is of low value; ·Short term leases; ·Where a lease contains a termination
option, exercisable at DRDGOLD’s discretion, and the termination option will
not be exercised, after considering the nature of the asset and the
practicality of purchasing the asset or leasing it from an alternative supplier
on a lease by lease basis; ·Where a lease is on a
month to month basis, the lease term is limited to one month’s enforceable
period, therefore that lease is excluded from the lease population; and ·Where a contract includes
a renewal clause, management has concluded that the lease will be renewed for a
period calculated based on historical renewal behavior, considering the
strategic nature of that asset.  IFRS 16 contains numerous additional disclosures which may be
required for the 2020 financial year.  91


---

3   NEW
STANDARDS, AMENDMENTS TO STANDARDS AND INTERPRETATIONScontinued  New standards, amendments to standards and interpretations not yet
effectivecontinued  IFRIC 23 Uncertainty over Income Tax Treatments (Effective date 1
July 2019) IFRIC 23 clarifies the
accounting for income tax treatments that have yet to be accepted by tax
authorities. Specifically, IFRIC 23 provides clarity on how to incorporate this
uncertainty into the measurement of tax as reported in the financial statements.  IFRIC 23 does not
introduce any new disclosures but reinforces the need to comply with existing
disclosure requirements about: ·judgments made; ·assumptions and other
estimates used; and the potential impact of
uncertainties that are not reflected.  Annual Improvements to IFRS Standards 2015/2017 Cycle various
standards (effective 1 July 2019) As part of
its process to make non-urgent but necessary amendments to IFRS, the IASB has
issued the Annual Improvements to IFRS Standards 2015–2017 Cycle. These will
not have a material impact on the Group. Definition
of Material (Amendments to IAS 1 and IAS 8) (Effective 1 July 2020) The amendment clarifies the definition of material to make it
easier to understand and provides guidance on how the definition should be
applied. The changes in the definition now ensures that the definition is
consistent across all IFRS standards and the Conceptual Framework. ·Old definition (IAS 1): Omissions or misstatements of items are
material if they could, individually or collectively, influence the economic
decisions that users make on the basis of the financial statements; ·New definition: Information is material if omitting, misstating or
obscuring it could reasonable be expected to influence the decisions that the primary
users of general-purpose financial statements make on the basis of those
financial statements, which provide financial information about a specific
reporting entity. The definition of material omissions or misstatements from IAS 8Accounting
Policies, Changes in Accounting Estimatesand Errorshas been
removed.  The
final assessment of the impact of the amendment will be finalised in due
course. Amendments
to References to Conceptual Framework in IFRS Standards (Effective 1 July 2020) The IASB decided
to revise the Conceptual Framework because certain important issues were not
covered and certain guidance was unclear or out of date. The revised Conceptual
Framework, issued by the IASB in March 2018, includes: ·New concepts on measurement including factors to be considered
when selecting the measurement basis; ·New concepts on presentation and disclosure, including when to
classify income and expenses in other comprehensive income; ·New guidance on when assets and liabilities are removed from
financial statements; ·Updated definitions of an asset and liability; ·Updated recognition criteria for including assets and liabilities
in financial statements; and Clarified the concepts of prudence, stewardship, measurement
uncertainty and substance over form.  The IASB also updated references to the Conceptual Framework in
IFRS Standards by issuing Amendments to References to the Conceptual Framework
in IFRS Standards. The Group is in the process of evaluating what impact these
will have on the Group.  Definition of a Business (Amendments to IFRS 3) (Effective 1 July
2020) Defining a business is important because the financial reporting
requirements for the acquisition of a business are different from the
requirements for the purchase of a group of assets that does not constitute a
business. The proposed amendments are intended to provide entities with clearer
application guidance to help distinguish between a business and a group of
assets when applying IFRS 3. In October 2018 the IASB issued this amendment to make it easier
for companies to decide whether activities and assets they acquire are a
business or merely a group of assets. The amendments:  ·confirm that a business must include inputs and a process, and
clarified that: (i) the process must be substantive and (ii) the inputs and
process must together significantly contribute to creating outputs. ·narrow the definitions of a business by focusing the definition of
outputs on goods and services provided to customers and other income from
ordinary activities, rather than on providing dividends or other economic
benefits directly to investors or lowering costs; and ·add a test that makes it easier to conclude that a company has
acquired a group of assets, rather than a business, if the value of the assets
acquired is substantially all concentrated in a single asset or group of
similar assets.  The amendments are effective for business combinations for which
the acquisition date is on or after the beginning of the first annual reporting
period beginning on or after 1 January 2020 and to asset acquisitions that
occur on or after the beginning of that period. Earlier application is
permitted. 92


---

4
 ACQUISITION OF ASSETS AND LIABILITIES
  SIGNIFICANT
  ACCOUNTING JUDGEMENTS
  The assessment of whether the acquisition of the assets and
  liabilities by DRDGOLD Limited (DRDGOLD) constituted an acquisition of assets
  under IFRS 2Share-based paymentor a business combination under IFRS
  3Business Combinationsrequired the exercise of judgement
  due to the application of the business definition under IFRS 3Business Combinationsto the nature of the assets. Key
  judgements made in the conclusion that the acquisition did not meet the
  definition of a business under IFRS 3Business Combinationsinclude that DP2 required
  decommissioning and reconfiguration from processing hard rock material to
  tailings material, thus outputs couldn’t be produced at acquisition date; the
  workforce acquired did not have the required skill or ability to process
  tailings and were required to be trained with DRDGOLD’s intellectual
  property; and that Sibanye-Stillwater did not process any tailings through
  the DP2 or DP3 plants and neither could DRDGOLD at acquisition date, without reconfiguring
  the assets acquired.
  SIGNIFICANT
  ACCOUNTING ASSUMPTIONS AND ESTIMATES
  Fair value of the assets and liabilities
  The fair value of the assets was determined using the income
  approach present value technique by applying a nominal discounted future cash
  flow model which was based on the Phase 1 and Phase 2 project plan for the
  assets, determined with the assistance of an independent expert. These
  calculations require use of assumptions and estimates and are inherently
  uncertain and could materially change over time. These assumptions and
  estimates include mineral reserves and resource estimates, production
  estimates, spot and future gold prices, foreign currency exchange rates,
  discount rates, estimates of costs to produce, future capital expenditure and
  the timing of cash flows in determining the fair value. The model was based
  on a forward-looking gold price of R562,481 per kilogram in year oneand
  operating costsescalating at an average of approximately 5.7% a year over a
  discount period of 20 yearsand
  a risk adjusted discount rate based on the nominal weighted average cost of
  capital of 15.03%. The discounted cash flow model is highly sensitive to
  changes in the forward-looking gold price and discount rate.
  Sensitivities
  A 1.1% increase/decrease in the gold price increases/decreases
  the net present value of property, plant and equipment by R100 million.
  A 0.7% increase/decrease in the discount rate
  decreases/increases the net present value of property, plant and equipment by
  R100 million.
  The fair value of the future environmental cost was determined
  with the assistance of an independent expert and was based on environmental
  management plans of Phase 1 and Phase 2 of the project which were developed
  in accordance with regulatory requirements. An average discount rate of 8.65%
  and average inflation rate of 5.7% and a discount period of 14 years, were
  used in the calculation of the estimated net present value of the
  rehabilitation liability.
  ACCOUNTING
  POLICIES
  Asset
  acquisition
  The IFRS applicable for
  this transaction is IFRS 2Share-based payment,as it represents a receipt of goods (assets) in exchange for
  equity instruments of DRDGOLD.The consequence thereof is that the
  assets and liabilities are recognised at their fair value using principles
  under IFRS 13Fair Value Measurement. A corresponding increase in
  equity is also recognised. No deferred tax is recognised on the transaction
  as it has not been accounted for as a business combination under IFRS 3Business
  Combinations, and therefore the initial recognition exemption applies in
  terms of IAS 12Income Taxes.
  Share-based
  payment reserve
  The option granted to
  Sibanye-Stillwater on the effective date of the transaction is accounted for
  as an equity settled share-based payment under IFRS 2Share-based payment,
  along with the acquisition of the assets and liabilities, as the option was
  issued at the same time of acquisition transaction, was entered into in
  contemplation of the transaction and the grant of the option in itself would
  not have been accomplished as a single transaction.
  The fair value was
  determined at grant date which is the same date as the date of the
  acquisition transaction. The option has no vesting conditions and therefore
  full fair value is recognised to equity and the corresponding entry allocated
  to the acquired assets and liabilities. On settlement of the option or if the
  option is not exercised by maturity date no further adjustment is made.
  Shareholder
  contribution reserve
  The shareholder
  contribution reserve represents the excess of the fair value of assets and
  liabilities acquired over the fair value value of equity instruments issued.
  93


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4
 ACQUISITION OF ASSETS AND LIABILITIEScontinued
  Effective 31 July 2018, DRDGOLD acquired gold
assets and liabilities associated with Sibanye Gold Limited trading as
Sibanye-Stillwater’s (“Sibanye-Stillwater”) West Rand Tailings
Retreatment Project, subsequently renamed Far West Gold Recoveries Proprietary
Limited (“FWGR”) (“FWGRAcquisition”). As purchase consideration for this acquisition,
DRDGOLD issued 265 million new ordinary shares equal to 38.05% of DRDGOLD’s
outstanding shares to Sibanye-Stillwater and granted Sibanye-Stillwater an
option to subscribe for new ordinary shares up to a total of 50.1% of the total
issued ordinary shares of DRDGOLD at a 10% discount to the prevailing market
value, to be exercised within two years from the effective date of the
acquisition. The transaction has been accounted for under
IFRS 2Share-based Paymentas it represents a receipt of goods in
exchange for equity instruments of DRDGOLD. The consequence thereof is that the
assets and liabilities are recognised at their fair value using principles
under IFRS 13Fair Value Measurementas they are identifiable, and their
fair value can be reliably measured. A corresponding increase in equity is also
recognised. Included in equity is the fair value of the option using a binomial
tree option pricing model which was based on a DRDGOLD spot share price
of R3.38, an exercise price modelled using the 10% discount to the prevailing
DRDGOLD share price throughout the two years to maturity date of 31 July 2020,
a dividend yield of 0.69% per annum and volatility of 55.44%. Volatility was
estimated using the historical DRDGOLD share price at the grant date. It is
measured as the annualised standard deviation of the daily log-returns of a
DRDGOLD share. The fair value of property, plant and equipment
was determined using the income approach present value technique by applying a
nominal discounted cash flow model. The significant inputs to establish the
cash flows as well as the timing thereof, were based mainly on the mineral
reserves and resources estimates, estimates costs to produce and future capital
expenditure as reported in the Competent Person’s report for the West Rand
Tailings Retreatment Project. The model was based on a forward-looking gold
price of R562 481 per kilogram in year one, and operating costs escalating at
an average of approximately 5.7% per annum over a discount period of 20 years, and
a risk adjusted discount rate based on the nominal weighted average cost of
capital of 15.03%. The discounted cash flow model is highly sensitive to
changes in the forward-looking gold price and discount rate. The fair value of investments in rehabilitation
obligation funds approximated its carrying value due to the short-term nature
of the investments. The at-acquisition environmental rehabilitation
liability was estimated based on fair value (i.e. what a market participant
would pay for the liability). It was determined with the assistance of an
independent expert and discounted to its net present value. No deferred tax has been recognised on the
acquisition as it has not been accounted for as a business combination under
IFRS 3Business Combinations, and therefore the initial recognition
exemption applies in terms of IAS 12Income Taxes. The values at acquisition included:   Amounts
  in R million
 Note
 2019Property,
  plant and equipment
 10
 1,225.6Investment
  in rehabilitation obligation funds
 12
 360.4Inventories
 
 14.2Provision
  for environmental rehabilitation
 11
 (247.4)Trade
  and other payables
 
 (3.5)Fair
  value of assets and liabilities acquired
 
 1,349.3Purchase
  consideration paid for assets and liabilities acquired
 
 1,349.3Ordinary
  shares issued at market value
 21.1
 895.7Option
  issued
 
 35.5Shareholder
  contribution - excess of fair value of assets and liabilities acquired over
  market value of ordinary shares and option issued
 
 418.1
 94


---

5
 REVENUEACCOUNTING
  POLICIES
  Revenue
  comprise the sale of gold bullion and silver bullion (produced as a
  by-product).
  The adoption of IFRS 15
  from 1 July 2018 had no impact on revenue recognition of the Group.
  Accounting policy before 1 July 2018
  Revenue
  is recognised to the extent that it is probable that economic benefits will
  flow to the Group and the amount of revenue can be reliably measured. Revenue
  is stated at the fair value of the consideration received or receivable,
  which is based on the afternoon London Bullion Market fixing price on the
  date the significant risks and rewards of ownership have been transferred to
  the buyer.
  The
  significant risks and rewards of ownership transfer to the buyer when Rand
  Refinery Limited (“Rand Refinery“), acting as an agent for the sale of
  all gold produced by the Group, delivers the gold to the buyer and the sales
  price is fixed, as evidenced by the certificate of sale.
  
  Accounting policy after 1 July 2018
  Revenue is recognised to the extent that
  it is probable that economic benefits will flow to the Group and the amount
  of revenue can be reliably measured. Revenue is measured based on the
  consideration specified in a contract with the customer, which is based on
  the London Bullion Market fixing price on the date when it transfers control
  over the goods to the customer.
  
  The Group recognises revenue at a point in
  time when Rand Refinery, acting as an agent for the sale of all gold produced
  by the Group, delivers the Gold to the buyer and the sales price is fixed, as
  evidenced by the certificate of sale. Rand Refinery is contractually obliged
  to make payment to the Group within two business days after the sale of the
  gold and silverand
  therefore no significant financing component exists.
  Amounts
  in R million
 2019
 2018
 2017Gold
  revenue
 2,758.8
 2,486.4
 2,336.1Silver
  revenue
 3.3
 4.0
 3.8Total
  revenue
 2,762.1
 2,490.4
 2,339.9
 A disaggregation of revenue by
operating segment is presented in note 23 OPERATING SEGMENTS. MARKET RISK Commodity price sensitivity Combined
impact of both US Dollar price of gold and South African Rand/US Dollar
exchange rate The Group's profitability
and the cash flows are primarily affected by changes in the market price of
gold which is sold in US Dollars and then converted to Rand. The Group did not
enter into forward sales of gold production, derivatives or other hedging
arrangements to establish a price in advance for the sale of future gold
production during the year, other than as described in note 6.2. A change of 10% in the average Rand gold
price received during the financial year would have increased/(decreased)
equity and profit/(loss) by the amounts shown below. This analysis assumes that
all other variables remain constant and specifically excludes the impact on
income tax. Amounts
  in R million
 2019
 2018
 201710%
  increase in the Rand gold price
 276.2
 249.0
 234.010%
  decrease in the Rand gold price
 (276.2)
 (249.0)
 (234.0)
 95


---

6
 RESULTS FROM OPERATING ACTIVITIES6.1
 COST OF SALES
  Amounts
  in R million
 Note
 2019
 2018
 2017Cost
  of sales
 
 (2,553.9)
 (2,347.7)
 (2,307.9)Operating
  costs (a)
 
 (2,471.1)
 (2,207.1)
 (2,109.3)Movement
  in gold in process and finished inventories - Gold Bullion
 
 32.6
 24.5
 4.8Depreciation
 10
 (169.1)
 (168.0)
 (179.8)Change
  in estimate of environmental rehabilitation
 11
 60.0
 2.9
 (0.6)Retrenchment
  costs (b)
 
 (6.3)
 -
 (23.0)(a)
  Operating costsThe
  most significant components of operating costs include:Consumable
  stores
 
 (866.5)
 (784.6)
 (783.9)Labour
  including short term incentives
 
 (476.7)
 (417.4)
 (351.0)Electricity
 
 (399.4)
 (369.0)
 (344.2)Specialist
  service providers
 
 (437.1)
 (326.9)
 (299.7)Water
 
 (44.1)
 (49.9)
 (71.1)Pre-production
  costs capitalised
 10
 93.7
 -
 -(b)
  Retrenchment costsVoluntary
  staff retrenchments
 (6.3)
 -
 (23.0)
 RELATED
PARTY TRANSACTIONS Sibanye-Stillwater
and its subsidiaries and associates, including Rand Refinery (refer note 25.2) in
which Sibanye-Stillwater holds a 44.4% interest and hence is an associate of Sibanye-Stillwater,
became related parties to the Group on 31 July 2018 when the FWGR Acquisition
(refer note 4) became unconditional. DRDGOLD issued 265 million new ordinary
shares (38.05% of its outstanding shares) and an option to subscribe for new
ordinary shares up to a total of 50.1% of the total issued ordinary shares of
DRDGOLD as purchase consideration for these assets. On the same
date FWGR entered into a smelting agreement with Sibanye-Stillwater to smelt
and recover gold from gold loaded carbon produced at FWGR, and deliver the gold
to Rand Refinery. As consideration for this service, Sibanye-Stillwater
receives a fee based on the smelting costs plus 10% of the smelting costs. Rand
Refinery performs the final refinement and marketing of all gold and silver produced
by the Group. As consideration for this service, Rand Refinery receives a
variable refining fee plus fixed marketing and administration fees. All
transactions and outstanding balances with related parties are to be settled in
cash within 30 days of the invoice date. None of the balances is secured. No
expense has been recognised in the current year as a credit loss allowance in
respect of amounts charged to related parties.  Amounts
  in R million
 
 2019Services
  rendered by related parties and included in operating costs:Supply
  of water and electricity1
 
 16.9Gold
  smelting and related charges1
 
 12.9Toll
  treatment charges2
 
 (6.5)Gold
  refining and related charges3
 
 3.626.91
  Supplied by Sibanye-Stillwater to FWGR2
  In August 2018 FWGR processed material on behalf of Sibanye-Stillwater in
  terms of a toll treatment agreement and recovered the related costs from
  Sibanye-Stillwater3
  Supplied by Rand Refinery to the Group subsequent to July 31, 2018 (refer
  note 5)
 96


---

6.2
 OTHER INCOMEACCOUNTING
  POLICIES
  Other
  income is recognised where it is probable that the economic benefits
  associated with a transaction will flow to the Group and it can be reliably
  measured.
  Other income is generally income
  earned from transactions outside the course of the Group’s ordinary
  activities and may include gains on disposal of property, plant and equipment
  and gains on financial instruments at fair value through profit or loss.
  Amounts
  in R million
 2019
 2018
 2017Gain
  on disposal of property, plant and equipment (a)
 5.8
 -
 12.9Gain
  on financial asset at fair value through profit or loss (b)
 2.1
 -
 -7.9
 -
 12.9(a)
  Gain on disposal of property, plant and equipmentIn
  December 2018 DRDGOLD concluded revised agreements to dispose certain of East
  Rand Proprietary Mines Limited's ("ERPM") underground assets
  to OroTree Limited (“OroTree”). The revised agreements consisted of a
  disposal of ERPM's underground mining and prospecting rights and an option
  agreement, at the sole discretion of OroTree, to purchase the underground
  mining infrastructure exercisable on or before 30 June 2019.The
  disposal of the underground mining and prospecting rights was concluded in
  the second half of the financial year ended 30 June 2019. OroTree did not
  exercise its option to purchase the underground mining infrastructure and a
  non-refundable amount of USD0.5 million that was paid by OroTree was
  recognised as a gain on disposal of property, plant and equipment.
 5.8
 -
 12.9(b)
  Gain on financial asset at fair value through profit or lossIn
  September 2018, DRDGOLD entered into a zero-cost collar with respect to 50
  000 ounces of gold with a floor of R565 000/kg and a ceiling of approximately
  R609 000/kg, spread equally over eight months expiring at the end of May
  2019.The
  collar was entered into to mitigate the liquidity risk brought about by the
  medium-term borrowings secured for the development of Phase 1 of FWGR.
 2.1
 -
 -
  6.3
 ADMINISTRATION EXPENSES AND OTHER COSTS
  Amounts
  in R million
 Note
 2019
 2018
 2017Included
  in administration expenses and other costs are the following:Increase
  in Long-Term Incentive ("LTI") liability
 19.1
 (21.4)
 (17.2)
 (10.0)Transactions
  costs incurred related to the acquisition of FWGR
 
 -
 (9.0)
 -Loss
  on disposal of property, plant and equipment
 
 -
 (0.6)
 -
 97


---

7
 FINANCE INCOMEACCOUNTING
  POLICY
  Finance
  income includes interest received, growth in cash and cash equivalents in environmental
  rehabilitation trust funds, growthin the reimbursive right for environmental rehabilitation
  guaranteesand the unwinding of the Payments made under protest.
  Amounts
  in R million
 Note
 2019
 2018
 2017Interest
  on financial assets measured at amortised cost
 13
 17.0
 21.8
 23.6Growth
  in cash and cash equivalents in environmental rehabilitation trust funds
 12
 30.5
 7.5
 7.5Growth
  in reimbursive right for environmental guarantees
 12
 7.8
 8.8
 8.9Unwinding
  of Payments made under protest
 25.1
 3.0
 0.7
 -58.3
 38.8
 40.0
  8
 FINANCE EXPENSEACCOUNTING
  POLICY
  Finance
  expenses comprise interest payable on financial instruments measured at
  amortised cost calculated using the effective interest method, unwinding of
  the provision for environmental rehabilitation, interest on finance leases and
  the discount recognised on Payments made under protest.
  Amounts
  in R million
 Note
 2019
 2018
 2017Interest
  on financial liabilities measured at amortised cost
 22
 (10.2)
 -
 -Interest
  on financial liabilities measured at amortised cost capitalised
 10
 9.4
 -
 -Unwinding
  of provision for environmental rehabilitation
 11
 (66.3)
 (45.6)
 (46.5)Discount
  recognised on Payments made under protest
 25.1
 (6.5)
 (8.8)
 -Other
  finance expenses
 
 (4.8)
 (4.0)
 (5.7)(78.4)
 (58.4)
 (52.2)
 9
 EARNINGS
  PER SHAREAmounts
  in R million
 
 2019
 2018
 2017Basic
  earningsThe
  calculation of basic earnings per ordinary share is based on the following:Profit
  for the year
 
 78.5
 6.5
 13.7Reconciliation
  of weighted average number of ordinary shares to diluted weighted average
  number of ordinary sharesNumber
  of shares
 Note
 2019
 2018
 2017Weighted
  average number of ordinary shares in issue
 
 664,553,283
 422,068,696
 422,068,696Option
  granted to Sibanye-Stillwater to acquire up to 50.1% ordinary shares
 21
 15,387,695
 -
 -Diluted
  weighted average number of ordinary shares
 
 679,940,978
 422,068,696
 422,068,696SA
  cents per share
 
 2019
 2018
 2017Basic
  earnings per share
 
 11.8
 1.5
 3.2Diluted
  earnings per share
 
 11.5
 1.5
 3.2
 98


---

10
 PROPERTY, PLANT AND EQUIPMENTSIGNIFICANT
  ACCOUNTING ASSUMPTIONS AND ESTIMATES
  Mineral
  reserves and resources estimates
  The Group
  is required to determine and report mineral reserves and resources in
  accordance with the South African Code for the Reporting of Exploration
  Results, Mineral Resources and Mineral Reserves (SAMREC Code). In order to
  calculate mineral reserves and resources, estimates and assumptions are
  required about a range of geological, technical and economic factors,
  including but not limited to quantities, grades, production techniques,
  recovery rates, production costs, transport costs, commodity demand, commodity
  prices and exchange rates. Estimating the quantity and/or grade of mineral
  reserves and resources requires the size, shape and depth of reclamation
  sites to be determined by analysing geological data such as the logging and
  assaying of drill samples. This process may require complex and difficult
  geological judgements and calculations to interpret the data. Because the
  assumptions used to estimate mineral reserves and resources change from
  period to period and because additional geological data is generated during
  the course of operations, estimates of mineral reserves and resources may
  change from period to period. Mineral reserves and resource estimates
  prepared by management are reviewed by an independent mineral resources
  expert.
  Changes
  in reported mineral reserves and resources may affect the Group’s
  life-of-mine plan, financial results and financial position in a number of
  ways including the following:
  • asset carrying values may be affected due to changes in
  estimated future cash flows;
  • depreciation charged to profit or loss may change where such
  charges are determined by the units-of-production method, or where the useful
  lives of assets change;
  • decommissioning, site restoration and environmental provisions
  may change where changes in estimated mineral reserves and resources affect
  expectations about the timing or cost of these activities; and
  • the carrying value of deferred tax assets and liabilities may
  change due to changes in estimates of the likely recovery of the tax benefits
  and charges.
  Depreciation
  The
  calculation of the units-of-production rate of depreciation could be affected
  if actual production in the future varies significantly from current forecast
  production. This would generally arise when there are significant changes in
  any of the factors or assumptions used in estimating mineral reserves and
  resources. These factors could include:
  • changes
  in mineral reserves and resources;
  • the
  grade of mineral reserves and resources may vary from time to time;
  •
  differences between actual commodity prices and commodity price assumptions;
  •
  unforeseen operational issues at mine sites including planned extraction
  efficiencies; and
  • changes
  in capital, operating, mining processing and reclamation costs, discount
  rates and foreign exchange rates.
  Date of commercial production
  The Company assesses the stage of the
  construction project to determine when the project moves into the production
  stage. The criteria used to assess the start date are determined based on the
  unique nature of each construction project. The Company considers various
  relevant criteria to assess when the construction project is substantially
  complete, ready for its intended use and moves into the production stage.
  Some of the criteria would include, but are not limited to the following:
  • the level of capital expenditure
  compared to the construction cost estimates;
  • the required technical specifications of
  assets being constructed;
  • ability to produce metal in saleable
  form (within specifications); and
  • ability to sustain commercial levels of
  production of metal.
  Impairment
  of property, plant and equipment
  The Group
  has two cash generating units ("CGUs")
  – Ergo and FWGR. The value in use of each individual CGU is estimated using
  discounted future cash flows based on the respective CGU’s life-of-mine plan.
  These calculations require the use of assumptions and estimates and are
  inherently uncertain and could change materially over time. These assumptions
  and estimates include the market capitalisation of the Group, mineral
  reserves and resource estimates, production estimates, spot and future gold
  prices, foreign currency exchange rates, discount rates, estimates of costs
  to produce and future capital expenditure in determining the recoverable
  amount. No impairment indicators were identified relating to FWGR. The shortfall
  in Ergo’s production was however considered as an impairment indicator for
  Ergo. The estimated recoverable amount of Ergo mining assets is based on
  updated life-of-mine plans, an average gold price of R629,404 per
  kilogram (2018: R550,411 per kilogram) in year one escalating at an
  average of approximately 5.6% (2018: 5.8%) a year over the eleven-year life-of-mine,
  (2018: twelve-year life-of-mine), and discounted at a weighted average cost
  of capital of 13.7% (2018: 11.2%).
  Sensitivity
  analysis
  The
  Group would begin impairment of the Ergo mining assets if the discount rate
  were to increase from 13.7% to 20.1%, or a 7.0% decrease in budgeted gold
  production or a 3% decrease in the rand gold price over the remaining life of
  the operation. The above sensitivities do not include a positive terminal
  value, relating to the disposal of any assets at the end of the useful life.
  99


---

10
 PROPERTY,
  PLANT AND EQUIPMENTcontinuedACCOUNTING
  POLICIES
  Recognition
  and measurement
  Property,
  plant and equipment comprise mine plant facilities and equipment, mine
  property and development (including mineral rights) and exploration assets.
  These assets (excluding exploration assets) are initially measured at cost,
  where after they are measured at cost less accumulated depreciation and
  accumulated impairment losses. Exploration assets are initially measured at
  cost, where after they are measured at cost less impairment losses.
  
  Cost
  includes expenditure that is directly attributable to the acquisition or
  construction of the asset, borrowing costs capitalised, as well as the costs
  of dismantling and removing an asset and restoring the site on which it is
  located. Subsequent costs are included in the asset’s carrying amount or
  recognised as a separate asset, as appropriate, only when it is probable that
  future economic benefits associated with the item will flow to the Group and
  the cost of the item can be measured reliably. Exploration and evaluation
  costs are capitalised as exploration assets on a project-by-project basis,
  pending determination of the technical feasibility and commercial viability
  of the project.
  Exploration
  assets comprise of costs of acquiring prospecting rights and generally
  consists of associated costs to convert a mineral resource to a mineral
  reserve. The process involves drilling, sampling and other processes
  necessary to evaluate the technical feasibility and commercial viability of a
  mineral resource to prove whether a mineral reserve exists. Costs are
  capitalised to the extent that they are directly attributable exploration
  expenditure and classified separately as property, plant and equipment, on a
  project by project basis. Once a mineral reserve is determined, the asset
  attributable to the mineral reserve is tested for impairment and then
  reclassified to another appropriate class of assets. Once reclassified,
  depreciation  commences when the assets are available for use.
  Preproduction
  costs
  The
  Group capitalises costs incurred and revenues earned before the date of
  commercial production to the extent that the costs and revenues are directly
  attributable to the assets under construction within a construction project
  to bring the assets to the location and condition necessary for its intended
  use. The Group ceases to capitalise these costs when the assets are capable
  of commercial production.
  Borrowing costs capitalised
  Interest on borrowings relating to
  the financing of qualifying major capital projects under construction is
  capitalised during the construction phase as part of the cost of the project.
  Such borrowing costs are capitalised over the period during which the asset
  is being acquired or constructed and borrowings have been incurred. Capitalisation
  ceases when construction is interrupted for an extended period or when the
  asset is substantially complete. Other borrowing costs are expensed as
  incurred.
  Depreciation
  Depreciation
  of mine plant facilities and equipment, as well as mining property and
  development (including mineral rights) are calculated using the units of
  production method which is based on the life-of-mine of each site. The
  life-of-mine is primarily based on proved and probable mineral reserves. It
  reflects the estimated quantities of economically recoverable gold that can
  be recovered from reclamation sites based on the estimated gold price.
  Changes in the life-of-mine will impact depreciation on a prospective basis.
  The life-of-mine is prepared using a methodology that takes account of
  current information to assess the economically recoverable gold from specific
  reclamation sites and includes the consideration of historical experience.
  The
  depreciation method, estimated useful lives and residual values are
  reassessed annually and adjusted if appropriate. Any changes to useful lives
  may affect prospective depreciation rates and asset carrying values. The
  current estimated useful lives for mine property and development, as well as
  mine plant facilities and equipment are based on the life-of-mine of each
  site, currently between three (2018: four;
  2017: two) and 11 (2018: 12; 2017: 12) years for Ergo mining assets and
  between five and 15 years for FWGR mining assets.
  Impairment
  The
  carrying amounts of property, plant and equipment are reviewed at each
  reporting date to determine whether there is any indication of impairment, or
  whenever events or changes in circumstances indicate that the carrying amount
  may not be recoverable. If any such indication exists, the asset’s recoverable
  amount is estimated. For the purposes of assessing impairment, assets are
  grouped at the lowest levels for which there are separately identifiable cash
  flows (CGUs).The
  key assets of a surface retreatment operation which constitutes a CGU are a reclamation
  site, a metallurgical plant and a tailings storage facility. These key assets
  operate interdependently to produce gold. The Ergo and FWGR operations each
  have separately managed and monitored reclamation sites, metallurgical plants
  and tailings storage facilities and are therefore separate CGUs.
  100


---

10
 PROPERTY,
  PLANT AND EQUIPMENTcontinuedACCOUNTING
  POLICIEScontinued
  Impairmentcontinued
  The
  recoverable amount of an asset or CGU is the greater of its value in use and
  its fair value less costs to sell. The recoverable amount was determined by
  estimating the value in use. The estimated future cash flows are discounted
  to their present value using a pre-tax discount rate that reflects current
  market assessments of the time value of money and the risks specific to the
  asset. An impairment loss is recognised in profit or loss if the carrying
  amount of an asset or CGU exceeds its recoverable amount.
  
  Exploration
  assets
  Exploration assets consists of costs of
  acquiring rights, activities associated with converting a mineral resource to
  a mineral reserve - the process thereof includes drilling, sampling and other
  processes necessary to evaluate the technical feasibility and commercial
  viability of a mineral resource to prove whether a mineral reserve exists.
  Exploration assets also include geological, geochemical and geophysical
  studies associated with prospective projects and tangible assets which comprise
  of property, plant and equipment used for exploratory activities.
  Depreciation for such assets is capitalised to exploration assets. Costs are
  capitalised to the extent that they are directly attributable exploration
  expenditure and classified separately as property, plant and equipment, on a
  project by project basis. Once a mineral reserve is determined or the project
  ready for development, the asset attributable to the mineral reserve or
  project is tested for impairment and then reclassified to another appropriate
  class of assets. Depreciation commences when the assets are available for
  use.
  
  Leased
  assets
  Upon
  initial recognition, the leased asset is measured at an amount equal to the
  lower of the fair value of the leased asset and the present value of the
  minimum lease payments. Subsequent to initial recognition, the asset is
  accounted for in the same manner as owned property, plant and equipment.
  Finance
  lease payments
  Minimum
  lease payments are apportioned between the finance charge and the reduction
  of the outstanding liability. The finance charge is allocated to each period
  during the lease term so as to produce a constant periodic rate of interest
  on the remaining balance of the liability.
 Amounts
  in R million
 Note
 Mine
  plant facilities and equipment (c)
 Mine
  property and development
 Exploration
  assets
 TotalJune
  30, 2019Cost
 
 2,156.2
 2,106.8
 256.7
 4,519.7Opening
  balance
 
 1,689.5
 1,264.5
 77.3
 3,031.3FWGR
  acquisition
 4
 198.4
 849.9
 177.3
 1,225.6Additions
  (a)
 
 284.5
 66.7
 2.5
 353.7Borrowing
  cost capitalised (b)
 22
 9.4
 -
 -
 9.4Disposals
 
 (1.6)
 (1.7)
 -
 (3.3)Change
  in estimate of decommissioning asset
 11
 (24.0)
 (75.3)
 2.3
 (97.0)Transfers
  between classes of property, plant and equipment
 
 -
 2.7
 (2.7)
 -Accumulated
  depreciation and impairment
 
 (909.9)
 (824.8)
 (9.7)
 (1,744.4)Opening
  balance
 
 (815.4)
 (753.5)
 (9.7)
 (1,578.6)Depreciation
 6.1
 (96.1)
 (73.0)
 -
 (169.1)Disposals
 
 1.6
 1.7
 -
 3.3Carrying
  value
 
 1,246.3
 1,282.0
 247.0
 2,775.3June
  30, 2018Cost
 
 1,689.5
 1,264.5
 77.3
 3,031.3Opening
  balance
 
 1,667.6
 1,230.0
 77.4
 2,975.0Additions
 
 82.5
 40.2
 3.4
 126.1Disposals
 
 (56.3)
 (17.4)
 -
 (73.7)Change
  in estimate of decommissioning asset
 11
 (4.3)
 11.7
 (3.5)
 3.9Accumulated
  depreciation and impairment
 
 (815.4)
 (753.5)
 (9.7)
 (1,578.6)Opening
  balance
 
 (760.8)
 (706.9)
 (9.7)
 (1,477.4)Depreciation
 6.1
 (104.3)
 (63.7)
 -
 (168.0)Disposals
 
 49.7
 17.1
 -
 66.8Carrying
  value
 
 874.1
 511.0
 67.6
 1,452.7
 101


---

10
 PROPERTY, PLANT AND EQUIPMENTcontinued
 (a)  Additions Included in additions is R330.7 million
incurred to develop Phase 1 of FWGR. These additions include R4.8 million
pre-production costs capitalised up to 1 April 2019 on which date FWGR achieved
commercial production (consisting of R93.7 million working costs and was
reduced with R88.9 million proceeds from the sale of gold produced) (refer
below) and R28.8 million relating to the FWGR milling infrastructure that has
not been commissioned to date. Date of commercial production Construction of Phase 1 commenced during August
2018 with R330.7 million spent on, inter alia, the reconfiguration of the
Driefontein 2 plant (“DP2”) and relevant infrastructure to process
tailings from the Driefontein 5 slimes dam and deposit residues on the
Driefontein 4 Tailings Storage Facility. During this construction phase, gold
was produced at the adjacent Driefontein 3 plant (“DP3”). Early-stage
commissioning commenced on 6 December 2018 with the pumping of reclaimed
tailings into the carbon in leach (“CIL”) circuit. Testing of the
reconfigured plant and ramp-up of production continued during the third quarter
of the year ended 30 June 2019. Management considered, inter alia, the design
capacity of the plant, recoveries and the ability to sustain production in
determining the date of commercial production. The date of commercial production for Phase 1
(excluding the milling section), which is the date when preproduction costs
cease to be capitalised and depreciation commenced, was determined to be 1 April
2019. (b)  Borrowing costs capitalised Borrowing costs capitalised consist of finance
costs incurred on the Revolving Credit Facility concluded to finance Phase 1 of
FWGR (refer note 22). Borrowing costs were capitalised at the applicable
lending rate of JIBAR plus a margin of 3.25% and ranged between 10.28% and
10.4% up to 1 April 2019 on which date FWGR achieved commercial production. (c)  Leased plant and equipment Ergo leases temporary power generation
equipment with a carrying value of R10.6 million (2018: R13.6 million) from
Aggreko Energy Rental Proprietary Limited under a finance lease with an
outstanding balance of R10.8 million (2018: R14.0 million). The finance
lease has an effective interest rate of 17.9% and is repayable in the
financial year ended June 30, 2020 including R9.9 million for the option to
acquire the leased equipment at the end of the lease term. R0.4 million interest is
payable in 2020. CONTRACTUAL
  COMMITMENTSAmounts
  in R million
 2019
 2018Contracted
  for but not provided for in the consolidated financial statements
 18.6
 32.7
  Capital expenditure related
to specific growth projects are financed on a project-by-project basis.Other capital
expenditure is financed from existing cash resources and cash generated from
operations. 102


---

11
 PROVISION FOR ENVIRONMENTAL REHABILITATIONSIGNIFICANT
  ACCOUNTING ASSUMPTIONS AND ESTIMATES
  Estimates
  of future environmental rehabilitation costs are determined with the
  assistance of an independent expert and are based on the Group’s
  environmental management plans which are developed in accordance with
  regulatory requirements, the life-of-mine plan and the planned method of
  rehabilitation which is influenced by developments in trends and technology.
  An average
  discount rate ranging between 7.6% and 8.0% (2018: 8.5%), average inflation
  rate of 5.5% (2018: 5.7%) and the discount
  periods as per the expected life-of-mine were used in the calculation of the
  estimated net present value of the rehabilitation liability.
  ACCOUNTING
  POLICIES
  The net
  present value of the estimated rehabilitation cost as at reporting date is
  provided for in full. These estimates are reviewed annually and are
  discounted using a pre-tax risk-free rate that is adjusted to reflect the
  current market assessments of the time value of money and the risks specific
  to the obligation.
  Annual
  changes in the provision consist of financing expenses relating to the change
  in the present value of the provision and inflationary increases in the
  provision, as well as changes in estimates.
  The
  present value of dismantling and removing the asset created before production
  commenced (decommissioning liabilities) are capitalised to property, plant
  and equipment against an increase in the rehabilitation provision. If a
  decrease in the liability exceeds the carrying amount of the asset, the
  excess is recognised in profit or loss. If the asset value is increased and
  there is an indication that the revised carrying value is not recoverable, an
  impairment test is performed in accordance with the accounting policy dealing
  with impairments of property, plant and equipment. Over time, the liability
  is increased to reflect an interest element, and the capitalised cost is
  depreciated over the life of the related asset. Cash costs incurred to
  rehabilitate these disturbances are charged to the provision and are
  presented as investing activities in the statement of cash flows.
  The
  present value of environmental rehabilitation costs relating to activities
  after production commenced (restoration liabilities) as well as changes
  therein are expensed as incurred and presented as operating costs. Cash costs
  incurred to rehabilitate these disturbances are presented as operating
  activities in the statement of cash flows. The cost of ongoing rehabilitation
  is recognised in profit or loss as incurred.
  Amounts
  in R million
 Note
 2019
 2018Opening
  balance
 
 553.4
 531.7FWGR
  Acquisition
 4
 247.4
 -Unwinding
  of provision
 8
 66.3
 45.6Change
  in estimate of environmental rehabilitation recognised in profit or loss (a)
 6.1
 (60.0)
 (2.9)Change
  in estimate of environmental rehabilitation recognised to decommissioning
  asset (b)
 10
 (97.0)
 3.9Environmental
  rehabilitation payments (c)
 
 (27.5)
 (24.9)To
  reduce decommissioning liabilities
 
 (16.6)
 (21.5)To
  reduce restoration liabilities
 14
 (10.9)
 (3.4)Closing
  balance
 
 682.6
 553.4Environmental
  rehabilitation payments to reduce the liability
 
 (27.5)
 (24.9)Ongoing
  rehabilitation expenditure *
 23
 (18.3)
 (26.7)Total
  cash spent on environmental rehabilitation
 
 (45.8)
 (51.6)* The
  Group also performs ongoing environmental rehabilitation arising from its
  current activities concurrently with production. These costs do not represent
  a reduction of the above liability and are expensed as operating costs.
 (a)  Change in estimate of environmental
rehabilitation recognised in profit or loss The change
in estimate of environmental rehabilitation recognised in profit or loss is
mainly as a result of updated vegetation and machine hire rates to recent
service level agreements and actual rates incurred, as well as, in line with
the Group’s strategy to reduce externally sourced potable water, alternative
water sources found to be viable to meet the Crown Complex post closure water
requirements. (b)  Change in estimate of environmental rehabilitation recognised
to property, plant and equipment The change
in estimate of environmental rehabilitation recognised to property, plant and
equipment is mainly as a result of a change in the methodology used to
calculate the FWGR provision for environmental rehabilitation. The at
acquisition provision was estimated based on what a market participant would
pay for the liability and is now based on the FWGR individual rehabilitation
plan which is in response to the current life of mine. (c)  Environmental rehabilitation payments The payments
made against the provision for environmental rehabilitation consist mainly of
rehabilitation work performed on the Brakpan/Withok Tailings Storage Facility
and on the Crown Complex.Gross cost to rehabilitate.  The Group
estimates that, based on current environmental and regulatory requirements, the
total undiscounted rehabilitation cost is approximately R824.3 million (2018: R670.4
million). 103


---

12
 INVESTMENTS IN
  REHABILITATION OBLIGATION FUNDSACCOUNTING
  POLICIES
  Cash and
  cash equivalents in environmental rehabilitation trust funds
  The adoption of IFRS 9 from 1 July 2018
  had no impact on the measurement of cash and cash equivalents in
  environmental rehabilitation trust funds of the Group.
  
  Accounting policy before 1 July 2018
  Cash and
  cash equivalents included in environmental rehabilitation trust funds
  comprise low-risk, interest-bearing cash and cash equivalents and are
  non-derivative financial assets categorised as loans and receivables.
  
  Cash and cash equivalents are initially
  measured at fair value. Subsequent to initial recognition, cash and cash
  equivalents are measured at amortised cost, which is equivalent to their fair
  value.
  
  Accounting policy after 1 July 2018
  Cash and cash equivalents included in
  environmental rehabilitation trust funds comprise low-risk, interest-bearing
  cash and cash equivalents and are non-derivative financial assets categorised
  as financial assets measured at amortised cost.
  Cash and cash equivalents are initially measured
  at fair value. Subsequent to initial recognition, cash and cash equivalents
  are measured at amortised cost, which is equivalent to their fair value.
  Reimbursive
  right for environmental rehabilitation guarantees
  Funds held
  in the cell captive that secure the environmental rehabilitation guarantees
  issued are recognised as a right to receive a reimbursement and are measured
  at the lower of the amount of the consolidated environmental rehabilitation
  liability recognised and the consolidated fair value of the fund assets.
  Changes in
  the carrying value of the fund assets, other than those resulting from
  contributions and payments, are recognised in finance income.
 Funding of environmental rehabilitation activities(refer note 11) Ongoing rehabilitation expenditure and environmental
rehabilitation payments to reduce the environmental rehabilitation obligations
are mostly funded by cash generated from operations. In addition, contributions
have been made to an environmental rehabilitation trust and a cell captive for
the sole use of future environmental rehabilitation payments. Guardrisk Insurance Company Limited ("Guardrisk") has guarantees in
issue amounting to R427.3 million (2018: R427.3 million) to the Department of
Mineral Resources ("DMR") on behalf of DRDGOLD related to the environmental
obligations. The funds in the cell captive serve as collateral for these
guarantees.  Amounts
  in R million
 Note
 2019
 2018Cash
  and cash equivalents in environmental rehabilitation trust funds
 
 508.9
 118.0Opening balance
 
 118.0
 110.5FWGR Acquisition
 4
 360.4
 -Growth
 7
 30.5
 7.5Reimbursive
  right for environmental rehabilitation guarantees
 
 78.6
 126.0Opening balance
 
 126.0
 117.2Funds received
 
 (55.2)
 -Growth
 7
 7.8
 8.8587.5
 244.0
 CREDIT RISK The Group is
exposed to credit risk on the total carrying value of the investments held in
the environmental rehabilitation trust funds. The Group
manages its exposure to credit risk by diversifying these investments across a
number of major financial institutions, as well as investing funds in low-risk,
interest-bearing cash and cash equivalents. MARKET RISK Interest
rate risk A change of
100 basis points (bp) in interest rates at the reporting date would have
increased/(decreased) equity and profit/(loss) by the amounts shown below. This
analysis assumes that all other variables, in particular the balance of the
funds, remain constant. The analysis excludes income tax.  104


---

12
 INVESTMENTS IN
  REHABILITATION OBLIGATION FUNDScontinued
  Amounts
  in R million
 
 2019
 2018100bp
  increase
 
 5.1
 1.2100bp
  (decrease)
 
 (5.1)
 (1.2)
  FAIR VALUE OF FINANCIAL INSTRUMENTS The fair
value of the cash and cash equivalents in the environmental rehabilitation
trust funds approximate their carrying value due to their short-term
maturities.  13
 CASH AND CASH EQUIVALENTSACCOUNTING
  POLICIES
  Cash and cash equivalents are
  short-term, highly liquid investments that are readily convertible to cash
  without the significant risk of changes in value and comprise cash on hand,
  demand deposits, and highly liquid investments which are readily convertible
  to known amounts of cash.
  The adoption of IFRS 9 from 1 July 2018
  had no impact on the measurement of cash and cash equivalents of the Group.
  
  Accounting policy before 1 July 2018
  Cash and
  cash equivalents are non-derivative financial assets categorised as loans and
  receivables. Cash and cash equivalents are initially measured at fair value.
  Subsequent to initial recognition, cash and cash equivalents are measured at
  amortised cost, which is equivalent to their fair value.
  
  Accounting policy after 1 July 2018
  Cash and cash equivalents are
  non-derivative financial assets categorised as financial assets measured at
  amortised cost. Cash and cash equivalents are initially measured at fair
  value. Subsequent to initial recognition, cash and cash equivalents are
  measured at amortised cost, which is equivalent to their fair value.
   Amounts
  in R million
 Note
 2019
 2018Included
  in cash and cash equivalents is restricted cash relating to:-
  Cash (including interest) held in escrow relating to the electricity tariff
  dispute with Ekurhuleni Metropolitan Municipality ("Municipality")
  (a)
 26
 -
 114.2-
  Environmental and other guarantees issued by the Standard Bank of South
  Africa Limited
 
 18.3
 17.2Interest
  relating to cash and cash equivalents
 7
 17.0
 21.8
 (a)Guarantee
issued During January 2019, a bank guarantee equal to the value of the
cash held in escrow (including interest) relating to the Municipality
Electricity Tariff Dispute (refer note 26) was issued in favor of the
Municipality and the balance of the cash held in escrow was released to Ergo’s
operational bank account. CREDIT RISK The Group is
exposed to credit risk on the total carrying value of its cash and cash
equivalents. The Group manages its exposure to credit risk by investing cash
and cash equivalents across a number of major financial institutions,
considering the credit ratings of these financial institutions. MARKET RISK Interest
rate risk A change of
100 basis points (bp) in interest rates at the reporting date would had
increased/(decreased) equity and profit/(loss) by the amounts shown below. This
analysis assumes that all other variables, in particular the cash balance and
foreign currency rates, remain constant. The analysis excludes income tax.  105


---

13
 CASH AND CASH
  EQUIVALENTScontinued
  Amounts
  in R million
 
 2019
 2018100bp
  increase
 
 2.8
 3.0100bp
  (decrease)
 
 (2.8)
 (3.0)
 Foreign
currency risk US Dollars
received on settlement of the trade receivables are exposed to fluctuations in
the US Dollar/South African Rand exchange rate until it is converted to South
African Rands. The Group
was not exposed to any fluctuations in the US Dollar/South African Rand
exchange rate on any US Dollars at the current or previous reporting date as
all the US Dollars held were converted to South African Rands. Foreign denominated cash is held in a foreign currency bank
account accruing negligible interest and is usually converted to South African
Rand on the day of receipt. Foreign cash is therefore not exposed to interest
rate risk. FAIR VALUE OF FINANCIAL INSTRUMENTS Cash and
cash equivalents The fair
value of cash and cash equivalents approximates their carrying value due to
their short-term maturities.  14
 CASH GENERATED FROM
  OPERATIONS
   Amounts
  in R million
 Note
 2019
 2018
 2017Profit/(loss)
  before tax
 
 105.1
 32.4
 (36.7)Adjusted
  forDepreciation
 10
 169.1
 168.0
 179.8Movement
  in gold in process and finished inventories - Gold Bullion
 6.1
 (32.6)
 (24.5)
 (4.8)Change
  in estimate of environmental rehabilitation
 11
 (60.0)
 (2.9)
 0.6Environmental
  rehabilitation payments
 11
 (10.9)
 (3.4)
 (7.9)Increase
  in long-term incentive liability
 19.1
 21.4
 17.2
 10.0(Gain)/loss
  on disposal of property, plant and equipment
 6.2
 (5.8)
 0.6
 (12.9)Finance
  income
 7
 (58.3)
 (38.8)
 (40.0)Finance
  expense
 8
 78.4
 58.4
 52.2Other
  non-cash items
 
 1.8
 1.3
 (1.0)Operating
  cash flows before working capital changes
 
 208.2
 208.3
 139.3Working
  capital changes
 
 73.8
 14.6
 (117.8)Change
  in trade and other receivables
 
 22.5
 22.2
 (57.6)Change
  in consumable stores and stockpiles
 
 (24.8)
 (28.2)
 (14.8)Payments
  made under protest
 25.1
 (11.7)
 (27.4)
 -Change
  in trade and other payables and employee benefits
 
 87.8
 48.0
 (45.4)Cash
  generated from operations
 
 282.0
 222.9
 21.5
 106


---

15
 TRADE AND OTHER
  RECEIVABLESACCOUNTING
  POLICIES
  The adoption of IFRS 9 from 1 July
  2018 had no material impact on the measurement of trade and other receivables
  of the Group.
  Accounting policy before 1 July 2018
  
  Recognition and measurement
  Trade
  and other receivables, excluding Value Added Tax and prepayments, are
  non-derivative financial assets categorised as loans and receivables.
  These
  assets are initially measured at fair value plus directly attributable
  transaction costs. Subsequent to initial recognition, they are measured at
  amortised cost using the effective interest method less any impairment losses.
  The Group
  derecognises a financial asset when the contractual rights to the cash flows
  from the asset expire, or it transfers the rights to receive the contractual cash
  flows in a transaction in which substantially all of the risks and rewards of
  ownership of the financial asset are transferred, or it neither transfers nor
  retains substantially all of the risks and rewards of ownership and does not
  retain control over the transferred asset. Any interest in such derecognised
  financial assets that is created or retained by the Group is recognised as a
  separate asset or liability.
  
  Impairment
  A
  financial asset not classified at fair value through profit or loss is assessed
  at each reporting date to determine whether there is any objective evidence
  (e.g. delinquency of a debtor and indications that a debtor will enter
  bankruptcy) that it is impaired. A financial asset is considered to be
  impaired if objective evidence indicates that one or more events have had a
  negative effect on the estimated future cash flows of that asset.
  
  Any
  impairment losses are recognised in the statement of profit or loss.
  
  Accounting policy after 1 July 2018
  
  Recognition and measurement
  Trade and other receivables,
  excluding Value Added Tax and prepayments, are non-derivative financial
  assets categorised as financial assets at amortised cost.
  These assets are initially measured
  at fair value plus directly attributable transaction costs. Subsequent to
  initial recognition, they are measured at amortised cost using the effective
  interest method less any expected credit losses using the Group’s business
  model for managing its financial assets.
  The Group derecognises a financial asset when
  the contractual rights to the cash flows from the asset expire, or it
  transfers the rights to receive the contractual cash flows in a transaction
  in which substantially all of the risks and rewards of ownership of the
  financial asset are transferred, or it neither transfers nor retains
  substantially all of the risks and rewards of ownership and does not retain
  control over the transferred asset. Any interest in such derecognised
  financial assets that is created or retained by the Group is recognised as a
  separate asset or liability.
  
  Impairment
  The Group recognises loss
  allowances for trade and other receivables at an amount equal to expected
  credit losses (“ECLs”). The Group uses the simplified ECL approach. When
  determining whether the credit risk of a financial asset has increased since
  initial recognition and when estimating ECLs, the Group considers reasonable
  and supportable information that is relevant and available without undue cost
  or effort. This includes both quantitative and qualitative information and
  analysis, based on informed credit assessments and including forward-looking
  information. The maximum period considered when estimating ECLs is the
  maximum contractual period over which the Group is exposed to credit risk.
  ECLs are a probability weighted
  estimate of credit losses. Credit losses are measured as the present value of
  all cash shortfalls (i.e. the difference between the cash flows due to the
  entity in accordance with the contract and the cash flows that the Group
  expects to receive). The Group assesses whether the financial asset is credit
  impaired at each reporting date. A financial asset is credit impaired when
  one or more events that have a detrimental impact on the estimated future
  cash flows of the financial asset have occurred, including but not limited to
  financial difficulty or default of payment. The Group will write off a
  financial asset when there is no reasonable expectation of recovering it
  after considering whether all means to recovery the asset have been
  exhausted, or the counterparty has been liquidated and the Group has assessed
  that no recovery is possible.
  Any impairment losses are recognised in
  the statement of profit or loss.
 Trade
receivables relate to gold sold on the bullion market by Rand Refinery in its
capacity as an agent. Settlement is usually received two working days from gold
sold date.   107


---

15
 TRADE AND OTHER
  RECEIVABLEScontinued
  Amounts
  in R million
 
 
 
 2019
 2018Trade
  receivables
 
 
 
 -
 0.6Value
  Added Tax
 
 
 
 42.0
 46.8Other
  receivables (a)
 
 
 
 25.3
 40.8Prepayments
 
 
 
 5.5
 12.2Allowance
  for impairment
 
 
 
 (4.9)
 (9.2)67.9
 91.2
 (a)Other receivables consist of a number of individually
insignificant receivables. CREDIT RISK The Group is
exposed to credit risk on the total carrying value of its trade receivables and
other receivablesexcluding Value
Added Taxand
prepayments. The Group
manages its exposure to credit risk on trade receivables by maintaining a short
term cycle to settlement of 2 working days. The Group manages its exposure to
credit risk on other receivables by establishing a maximum payment period of 30
days, and ensuring that counterparties are of good credit standing and
transacting on a secured or cash basis where considered necessary.The
majority of other receivables comprises of balances with counterparties who
have been transacting with the Group for over 5 years and in some of these
cases, the counterparties are also suppliers of the Group.Receivables
are regularly monitored and assessed for recoverability. The balances of counterparties who have been assessed as being
credit impaired at reporting date are as follows: 2019Amounts
  in R million
 Non-credit
  impaired
 Credit
  impairedTrade
  receivables
 -
 -Other
  receivables
 23.2
 2.123.2
 2.1Loss
  allowance
 (2.8)
 (2.1)
 Comparative
  information under IAS 39:Amounts
  in R million
 2018Receivables
  that are past due but not impaired at 30 June
 15.3Receivables
  that are past due and impaired at 30 June
 9.2
 Movement in
the allowance for impairment in respect of trade and other receivables during
the year was as follows: Amounts
  in R million
 2019
 2018Balance
  at 1 July
 (9.2)
 (9.7)Impairment
  recognised on other receivables at 1 July 2018 included in operating costs
 (3.2)
 -Loss
  allowance as a 1 July 2018 under IFRS 9
 (12.4)
 (9.7)Credit
  loss allowance/impairments recognised included in operating costs
 (3.1)
 -Credit
  loss allowance/impairments reversed included in operating costs
 5.3
 0.5Credit
  loss allowance written off against related receivable
 5.3
 -Balance
  at 30 June
 (4.9)
 (9.2)
 MARKET RISK Interest
rate risk Trade and
other receivables do not earn interest and are therefore not subject to
interest rate risk.  108


---

15TRADE AND
OTHER RECEIVABLEScontinued  Foreign
currency risk Gold is sold
at spot rates and is denominated in US Dollars. Gold sales and thus trade
receivables, are therefore exposed to fluctuations in the US Dollar/South
African Rand exchange rate.  All foreign currency held at
the current and previous reporting dates of June 30, 2019 and June 30, 2018
respectively were denominated in South African Rand and are therefore not
exposed to fluctuations in the US Dollar/South African Rand exchange rate. FAIR VALUE OF FINANCIAL INSTRUMENTS The fair value of trade and
other receivables approximate their carrying value due to their short-term
maturities.  16
 TRADE AND OTHER
  PAYABLESACCOUNTING
  POLICIES
  The adoption of IFRS 9 from 1 July
  2018 had no impact on the recognition or measurement of trade and other
  payables, excluding payroll accruals, accrued leave pay and provision for
  performance-based incentives of the Group.
  Trade
  and other payables, excluding payroll accruals, accrued leave pay and
  provision for performance based incentives, are non-derivative financial
  liabilities categorised as financial liabilities measured at amortised cost.
  These
  liabilities are initially measured at fair value plus directly attributable
  transaction costs. Subsequent to initial recognition, they are measured at
  amortised cost using the effective interest method. The Group derecognises a
  financial liability when its contractual rights are discharged, or cancelled
  or expire.
  Short-term
  employee benefits are expensed as the related service is provided. A
  liability is recognised for the amount expected to be paid if the Group has a
  present legal or constructive obligation to pay this amount as a result of
  past service provided by the employee and the obligation can be estimated
  reliably.
   Amounts
  in R million
 Note
 2019
 2018Trade
  payables and accruals
 
 324.4
 227.0Accrued
  leave pay
 
 39.0
 32.9Provision
  for short term performance based incentives
 
 32.5
 24.7Payroll
  accruals
 
 23.3
 18.7419.2
 303.3Interest
  relating to trade payables and accruals included in profit or loss
 
 (2.0)
 (1.5)RELATED
  PARTY BALANCESTrade
  payables and accruals include the following amounts payable to related
  parties:Sibanye-Stillwater
 
 4.1
 -Rand
  Refinery
 25.2
 0.2
 -
 LIQUIDITY RISK Trade payables and
accruals are all expected to be settled within 12 months from reporting date. FAIR VALUE OF
FINANCIAL INSTRUMENTS The fair value of trade payables and
accruals approximate their carrying value due to their short-term maturities. 109


---

17
 INVENTORIESACCOUNTING
  POLICIES
  Gold in
  process is stated at the lower of cost and net realisable value. Costs are
  assigned to gold in process on a weighted average cost basis. Costs comprise
  all costs incurred to the stage immediately prior to smelting, including
  costs of extraction and processing as they are reliably measurable at that
  point. Gold bullion is stated at the lower of cost and net realisable value.
  Selling and general administration costs are excluded from inventory
  valuation.
  Consumable stores are
  stated at cost less allowances for obsolescence. Cost of consumables and
  stockpile material is based on the weighted average cost principle and
  includes expenditure incurred in acquiring inventories and bringing them to
  their existing location and condition.
  Net
  realisable value is the estimated selling price in the ordinary course of
  business, less the estimated cost of completion and selling expenses.
  Amounts
  in R million
 
 2019
 2018Consumable
  stores
 
 145.2
 129.0Gold
  in process (a)
 
 99.6
 66.2Finished
  inventories - Gold Bullion
 
 59.8
 37.8Total
  inventories
 
 304.6
 233.0
 (a)  Gold in process Gold in process at June 30, 2019 includes
stockpiles of sand material trucked to the City Plant amounting to R20.3
million (June 30, 2018: 1.1 million). 18
 INCOME TAXSIGNIFICANT
  ACCOUNTING ASSUMPTIONS AND ESTIMATES
  Management
  periodically evaluates positions taken where tax regulations are subject to
  interpretation. This includes the treatment of both Ergo and FWGR as single mining
  operations respectively, pursuant to the relevant ring-fencing legislation.
  The
  deferred tax liability is calculated by applying a forecast weighted average
  tax rate that is based on a prescribed formula. The calculation of the
  forecast weighted average tax rate requires the use of assumptions and
  estimates and are inherently uncertain and could change materially over time.
  These assumptions and estimates include expected future profitability and
  timing of the reversal of the temporary differences. Due to the forecast
  weighted average tax rate being based on a prescribed formula that increases
  the effective tax rate with an increase in forecast future profitability, andvice versa, the tax rate can vary significantly year on year and can
  move contrary to current period financial performance.
  A
  100 basis points increase in the effective tax rate will result in an
  increase in the net deferred tax liability at June 30, 2019 of approximately
  R8.6 million (2018: R8.0 million; 2017: R7.4 million).
  The
  assessment of the probability that future taxable profits will be available against
  which the tax losses and unredeemed capital expenditure can be utilised
  requires the use of assumptions and estimates and are inherently uncertain
  and could change materially over time.
  Capital
  expenditure is assessed by the South African Receiver of Revenue when it is
  redeemed against taxable mining income rather than when it is incurred. A
  different interpretation by the South African Receiver of Revenue regarding
  the deductibility of these capital allowances may therefore become evident subsequent
  to the year of assessment when the capital expenditure is incurred.
  ACCOUNTING
  POLICIES
  Income
  tax expense comprises current and deferred tax. Each company is taxed as a
  separate entity and tax is not set-off between the companies.
  Current
  tax
  Current
  tax comprises the expected tax payable or receivable on the taxable income or
  loss for the year and any adjustment on tax payable or receivable in respect
  of the previous year. Amounts are recognised in profit or loss except to the
  extent that it relates to items recognised directly in equity or OCI. The
  current tax charge is calculated on the basis of the tax laws enacted or
  substantively enacted at the reporting date.
  Deferred
  tax
  Deferred
  tax is recognised in respect of temporary differences between the carrying
  amounts and the tax bases of assets and liabilities. Deferred tax is not
  recognised on the initial recognition of assets or liabilities in a
  transaction that is not a business combination and that affects neither
  accounting nor taxable profit.
  110


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18
 INCOME TAXcontinuedDeferred
  taxcontinued
  Deferred
  tax assets relating to unutilised tax losses and unutilised capital
  allowances are recognised to the extent that it is probable that future
  taxable profits will be available against which the unutilised tax losses and
  unutilised capital allowances can be utilised. The recoverability of these
  assets is reviewed at each reporting date and adjusted if recovery is no
  longer probable.
  Deferred
  tax related to gold mining income is measured at a forecast weighted average
  tax rate that is expected to be applied to temporary differences when they
  reverse, using tax rates enacted or substantially enacted at the reporting
  date.18.1
 INCOME TAX EXPENSE
 Tax
on gold mining income is determined based on a formula: Y = 34 - 170/X where Y
is the percentage rate of tax payable and X is the ratio of taxable income, net
of any qualifying capital expenditure that bears to gold mining income derived,
expressed as a percentage. Non-mining income, which consists primarily of
interest accrued, is taxed at a standard rate of 28% for all periods presented. All mining capital expenditure is deducted in the year it is
incurred to the extent that it does not result in an assessed loss. Capital
expenditure not deducted from mining income is carried forward as unutilised
capital allowances to be deducted from future mining income. 
  Amounts
  in R million
 2019
 2018
 2017Mining
  tax
 (29.8)
 (23.2)
 54.2Non-mining
  tax
 3.2
 (2.7)
 (3.8)(26.6)
 (25.9)
 50.4Comprising:Current
  tax  - current year
 1.6
 (6.4)
 (1.9)Deferred
  tax  - current year
 (28.2)
 (19.5)
 53.4Deferred
  tax  - prior year
 -
 -
 (1.1)(26.6)
 (25.9)
 50.4Tax
  reconciliationMajor
  items causing the Group's income tax expense to differ from the statutory
  rate were:Tax
  on net (profit)/loss before tax at the South African corporate tax rate of
  28%
 (30.2)
 (9.0)
 10.3Rate
  adjustment to reflect the actual realised company tax rates
 7.4
 3.5
 (7.9)Deferred
  tax rate adjustment (a)
 (15.0)
 (12.8)
 37.5Non-deductible
  expenditure (b)
 (11.9)
 (9.8)
 (1.8)Utilisation
  of tax losses for which deferred tax assets were previously unrecognised
 -
 2.6
 5.9Current
  year tax losses for which no deferred tax was recognised
 (2.7)
 (0.8)
 (0.3)Exempt
  income and other non-taxable income
 4.4
 -
 5.4Other
  temporary differences (c)
 16.8
 -
 -Tax
  incentives
 1.7
 0.4
 0.2Over/(under)
  provided in prior periods
 2.9
 -
 1.1Income
  tax
 (26.6)
 (25.9)
 50.4
 (a) Deferred tax rate adjustment The forecast weighted
average deferred tax rate increased from 20.3% to 22.0% as a result of an increase
in forecast taxable income of Ergo (2018: increased from 18.6% to 20.3% due to the increase
in forecast taxable
income of
Ergo; 2017: decreased from 23.1% to 18.6% due to a decrease in forecast taxable income of Ergo). (b) Non-deductible
expenditure The most significant
non-deductible expenditure incurred by the Group during the year includes: ·R16.6
million depreciation on fair value of property, plant and equipment of FWGR to
which theinitial recognition exemption applies
in terms of IAS 12Income Taxes; ·R6.5 million discount
recognised on Payments made under protest (2018: R8.8 million); ·R11.3
million net operating cost related to Ergo Business Development Academy Not for
Profit Company that is not deductible as it is exempt from income tax (2018: R7.5 million); and ·R6.0 million expenditure not
incurred in generation of taxable income (2018: R15.0 million; (2017: R6.0 million). (c) Other temporary
differences Capital allowances not
previously recognised. 111


---

18
 INCOME
  TAXcontinued18.2
 DEFERRED
  TAXDeferred
  tax assets and liabilities relate to the following:Amounts
  in R million
 2019
 2018Deferred
  tax assetProvisions
 10.0
 8.710.0
 8.7Deferred
  tax liabilityProperty,
  plant and equipment
 (297.0)
 (261.5)Provisions,
  including rehabilitation provision
 104.4
 95.0Other
  temporary differences (1)
 (0.6)
 2.8(193.2)
 (163.7)Net
  deferred mining and income tax liability
 (183.2)
 (155.0)Movement
  in the net deferred tax liability is as follows:Amounts
  in R million
 2019
 2018Opening
  balance
 (155.0)
 (135.5)Recognised
  in profit or loss
 (28.2)
 (19.5)Property,
  plant and equipment
 (35.5)
 (37.7)Provisions,
  including rehabilitation provision
 10.7
 18.5Other
  temporary differences (1)
 (3.4)
 (0.3)Closing
  balance
 (183.2)
 (155.0)(1)
  Includes the temporary differences on the finance lease obligation.
 Deferred
  tax assets have not been recognised in respect of the following:Amounts
  in R million
 2019
 2018Tax
  losses
 19.4
 37.3Unredeemed
  capital expenditure
 254.8
 272.9Capital
  losses
 329.9
 330.0Deferred
  tax assets have not been recognised for Group entities that are not expected
  to generate future taxable profits against which the tax losses, unredeemed
  capital expenditure and capital losses can be utilised.
 112


---

19
 EMPLOYEE BENEFITSACCOUNTING
  POLICIES
  Cash-settled
  share-based payments (“Long-Term Incentive” or “LTI”)
  Cash-settled
  share-based payments are measured at fair value and remeasured at each
  reporting date to reflect the potential outflow of cash resources to settle
  the liability, with a corresponding adjustment in profit or loss. Vesting
  assumptions for non-market conditions are reviewed at each reporting date to
  ensure they reflect current expectations.
  Post-retirement
  medical benefit
  The
  Group's net obligation in respect of long-term employee benefits is the
  amount of future benefit that employees have earned in return for their
  service in the current and prior periods. That benefit is discounted to
  determine the present value. Remeasurements are recognised in profit or loss
  in the period in which they arise.
  Amounts
  in R million
 Note
 2019
 2018Non-current
  employee benefits
 
 37.4
 40.6Liability
  for long term incentive scheme
 19.1
 28.4
 31.9Liability
  for post-retirement medical benefits*
 
 9.0
 8.7Current
  employee benefits
 
 22.6
 13.2Liability
  for long term incentive scheme
 19.1
 22.6
 13.2Total
  employee benefits
 
 60.0
 53.8*
  Unfunded medical aid benefit plan
 19.1 LIABILITY FOR LONG TERM
INCENTIVE SCHEME Terms of the November
2015 grant made under the DRDGOLD Group's amended long term incentive  scheme
are: • The scheme has a finite term of 5 years and thus no top-up awards
are made when the shares vest; • The phantom shares are
issued at an exercise price of nil and will vest in 3 tranches: 20%, 30% and 50% on the 3rd, 4th
and 5th anniversaries respectively, subject to individual service
and performance conditions being met; and • The phantom shares
will be settled at the 7 day volume weighted average price ("VWAP")
of the DRDGOLD share. Amounts
  in R million
 
 
 
 Note
 2019
 2018Movements
  in the total liability for long-term incentive scheme is as follows:Opening
  balance
 
 
 
 
 45.1
 30.7Increase
  in long-term incentive liability
 
 6.3
 21.4
 17.2Vested
  and paid
 
 
 
 
 (15.5)
 (2.8)Total
  liability for long-term incentive scheme
 
 51.0
 45.1The
  total liability for long-term incentive scheme is expected to be settled as
  follows:
 51.0
 45.1Within
  12 months after reporting date
 22.6
 13.2After
  12 months after reporting date
 28.4
 31.9Reconciliation
  of outstanding phantom shares
 2019
 2018Weighted
 
 Weightedaverage
 
 averageShares
 price
 Shares
 priceNumber
 R
  per share
 Number
 R
  per shareOpening
  balance
 
 
 20,189,467
 
 21,144,534Granted
 
 
 388,547
 3.37
 -Vested
  and paid
 
 
 (4,037,883)
 3.82
 (955,067)
 2.93Forfeited
 
 
 (383,073)
 4.37
 -Closing
  balance
 
 
 16,157,058
 
 20,189,467Ageing
  of outstanding phantom shares:
 
 30
  June 2021
 30
  June 2022
 TotalNovember
  2015
 
 
 
 5,913,190
 10,243,868
 16,157,058
  113


---

19
EMPLOYEE BENEFITScontinued 19.1 LIABILITY FOR LONG TERM INCENTIVE SCHEMEcontinued Fair value The fair
value of the liability for the long-term incentive scheme is mostly influenced
by the DRDGOLD Limited share price. Other inputs influencing the fair value are
the forward dividend yield and estimates of staff retention and performance
conditions. The inputs most significantly influencing the measurement of the
fair values are as follows: 2019
 2018
 Grant
  date7
  day VWAP of the DRDGOLD Limited share
 
 4.37
 3.71
 2.26Annualised
  forward dividend yield
 
 4.3%
 1.8%
 4.3%
 19.2 TRANSACTIONS WITH KEY
MANAGEMENT PERSONNEL Interests
in contracts None of the directors,
officers or major shareholders of DRDGOLD or, to the knowledge of DRDGOLD’s
management, their families, had any interest, direct or indirect, in any
transaction entered into during the year ended June 30, 2019 or the preceding
financial years, or in any proposed transaction which has affected or will
materially affect DRDGOLD or its subsidiaries other than disclosed in these
financial statements. None of the directors or officers of DRDGOLD or any
associate of such director or officer is currently or has been at any time
during the past financial year materially indebted to DRDGOLD. Key
  management personnel remunerationAmounts
  in R million
 Note
 2019
 2018
 2017-
  Board fees paid
 
 5.8
 5.6
 5.0-
  Salaries paid
 
 61.7
 53.6
 52.9-
  Short term incentives relating to this cycle
 
 31.5
 22.5
 --
  Long term incentives paid during the cycle
 19.1
 15.5
 2.8
 9.6-
  Retrenchments
 
 1.6
 -
 -116.1
 84.5
 67.5
 20   CAPITAL MANAGEMENT The primary objective of the
Group's capital management policy is to ensure that adequate capital is available
to meet the requirements of the Group from time to time, including capital
expenditure. The Group considers the appropriate capital management strategy
for specific growth projects as and when required. Finance leases are not
considered to be debt. Financing the development
of Phase 1 of FWGR During the year endedJune 30, 2019, R192.0
million was raised through the Company’s Revolving Credit Facility (“RCF”) to fund
the development of FWGR Phase 1.At June 30, 2019 this amount was repaid in full
and the Group had no external debt in line with its aim for the
existing operations to remain unleveraged. Liquidity
management The Group’s facilities include a
R300 million RCF initially secured to finance the development of Phase 1 of
FWGR. In January 2019, R125 million of the RCF was committed to issue a
guarantee to Ekurhuleni Local Municipality (refer note 22). R175 million of the
initial RCF remains uncommitted and available to the Group. The RCF permits a consolidated debt
ratio (net debt to adjusted EBITDA) of at most 2:1 and a consolidated interest
coverage ratio (net interest to adjusted EBITDA) of at least 4:1 calculated on
a twelve-month rolling basis respectively. Management monitors the covenant
ratio levels to ensure compliance with the covenants, as well as maintain
sufficient uncommitted facilities to ensure satisfactory liquidity for the
Group. The covenant ratios were not breached during the year ended June 30,
2019. 114


---

21
 EQUITYACCOUNTING
  POLICIES
  Stated
  share capital
  Ordinary
  shares and the cumulative preference shares are classified as equity.
  Incremental costs directly attributable to the issue of ordinary shares are
  recognised as a deduction from equity, net of any tax effect.
  Repurchase
  and reissue of share capital (treasury shares)
  When
  shares recognised as equity are repurchased, the amount of the consideration
  paid, which includes directly attributable costs is recognised as a deduction
  from equity. Repurchased shares are classified as treasury shares and are
  presented as a deduction from stated share capital.
  Dividends
  Dividends are recognised as a liability on the date on which
  they are declared which is the date when the shareholders’ right to the
  dividends vests.
  21.1
 SHARE CAPITAL
  In terms of an ordinary resolution
passed at the previous annual general meeting, the remaining unissued ordinary
shares in the company are under the control of the directors until the next
general meeting. Amounts
  in R million
 2019
 2018
 2017Authorised
  share capital1,500,000,000
  (2018: 1,500,000,000; 2017: 600,000,000) ordinary shares of no par value5,000,000
  (2018 and 2017: 5,000,000) cumulative preference shares of 10 cents each
 0.5
 0.5
 0.5Issued
  share capital696,429,767
  (2018 and 2017: 431,429,767) ordinary shares of no par value (a)
 5,123.3
 4,227.9
 4,227.99,474,920
  (2018 and 2017: 9,361,071) treasury shares held within the Group (b)
 (51.0)
 (50.7)
 (50.7)5,000,000
  (2018 and 2017: 5,000,000) cumulative preference shares of 10 cents each
 0.5
 0.5
 0.55,072.8
 4,177.7
 4,177.7
 RELATED PARTY
RELATIONSHIPS AND TRANSACTIONS (a)  Ordinary
shares issued Sibanye-Stillwater and its
subsidiaries and associates became related parties to the Group on July 31, 2018
when the FWGR Acquisition (refer note 4) became unconditional. DRDGOLD issued
265 million new ordinary shares (38.05% of its outstanding shares) and an
option to subscribe for new ordinary shares up to a total of 50.1% of the total
issued ordinary shares of DRDGOLD as purchase consideration for these assets. (b)  Treasury
shares Shares in
DRDGOLD Limited are held in treasury by Ergo Mining Operations Proprietary
Limited ("EMO"). 113,849 shares were acquired in the market during the year ended June
30, 2019 at an average price of R2.68 (2018: nil; 2017: nil shares
acquired). No dividends were received during the year on these shares (2018: R0.9
million; 2017: R1.1 million).    21.2
 DIVIDENDS
  Amounts
  in R million
 2019
 2018
 2017Dividends
  paid during the year net of treasury shares:No
  final dividend was paid relating to 2018 (2017: 5 SA cents per share; 2016:
  12 SA cents per share)
 -
 21.1
 50.6No
  interim dividend was paid relating to 2019 (2018: 5 SA cents per share: 2017:
  nil)
 -
 21.1
 -Total
 -
 42.2
 50.6
 After June 30, 2019, a dividend of 20 cents per qualifying share (R137.4
million) was approved by the directors as a final dividend for 2019. The
dividend has not been provided for and does not have any tax impact on the Company. 115


---

22
 BORROWINGSACCOUNTING
  POLICIES
  Interest-bearing
  borrowings are initially recognised at fair value and are subsequently
  measured at amortised cost with any difference between the initial amount and
  the redemption value being recognised in profit or loss over the period of
  the borrowings on an effective interest basis. If the Group revises its
  estimates of payments, the carrying amount of the liability is adjusted to
  reflect actual and revised estimated cash flows. The carrying amount is
  recalculated by computing the current value of estimated future cash flows at
  the liability’s original effective interest rate. The adjustment is
  recognised as income or expense in profit or loss.
  On August 1, 2018, DRDGOLD Limited
entered into a ZAR300 million Revolving Credit Facility (“RCF”) secured
with ABSA Bank Limited (acting through its Corporate and Investment Banking
division). The purpose of the RCF was to finance the development of Phase 1 of
FWGR and working capital requirements, replacing the R100 million overdraft
facility that was in place during the year ended June 30, 2018. On December 10,
2018, DRDGOLD Limited entered into an addendum to the ZAR300 million RCF. The
purpose of the addendum to the RCF was to commit R125 million of the RCF
facility to a performance guarantee to Ekurhuleni Metropolitan Municipality (refer
note 13) that was issued on the same date by ABSA Bank Limited (acting through
its Corporate and Investment Banking division). The cash
held in escrow were released to Ergo’s operational bank accounts in January
2019. Amounts
  in R million
 Note
 2019Opening
  balance
 
 -Borrowings
  raised
 
 192.0Borrowings
  repaid
 
 (192.0)Finance
  costs incurred
 8
 10.2Interest
  and related charges
 
 6.6Raising
  fees
 
 3.6Finance
  costs repaid
 
 (10.2)Closing
  balance
 
 -
 Salient terms of the RCF Interest rate                                 Jibar Interest
rate margin                   3.25% Final
repayment date                 1 August 2020 Security                                        Pledge
and cession of DRDGOLD’s shares in and shareholder claims against: • Ergo Mining Proprietary Limited (guarantor to RCF) • Far West
Gold Recoveries Proprietary Limited (guarantor to RCF) 23
 OPERATING SEGMENTSACCOUNTING
  POLICIES
  Operating
  segments are reported in a manner consistent with internal reports that the
  Group’s chief operating decision maker (CODM) reviews regularly in allocating
  resources and assessing performance of operating segments. The CODM has been
  identified as the Group’s Executive Committee. The Group has one revenue
  stream, the sale of gold. To identify operating segments, management reviewed
  various factors, including operational structure and mining infrastructure.
  It was determined that an operating segment consists of a single or multiple
  metallurgical plants and reclamation sites that, together with its tailings
  storage facility, is capable of operating independently.
  When
  assessing profitability, the CODM considers, inter alia, the revenue
  and production costs of each segment. The net of these amounts is the
  operating profit or loss. Therefore, operating profit has been disclosed in
  the segment report as the primary measure of profit or loss. The CODM also
  considered other costs that, in addition to the operating profit or loss,
  result in the working profit or loss.
 Ergois a surface
gold retreatment operation which treats old slime dams and sand dumps to the
south of Johannesburg’s central business district as well as the East and
Central Rand goldfields. The operation comprises three plants. The Ergo and
Knights plants continue to operate as metallurgical plants. The City Deep plant
continues to operate as a pump/milling station feeding the metallurgical plants. FWGRis a surface
gold retreatment operation and treats old slime dams in the West Rand
goldfields. Phase 1, which entails the reconfiguration of the Driefontein 2
plant and relevant infrastructure to process tailings from the Driefontein 5
slimes dam and deposit residues on the Driefontein 4 Tailings Storage Facility,
was commissioned on 1 April 2019. Corporate
office and other reconciling items(collectively referred to as"Other
reconciling items") are taken into consideration in the strategic
decision-making process of the chief operating decision maker and are therefore
included in the disclosure here, even though they do not earn revenue. This
includes taking into consideration the Group’s adjusted EBITDA for the purpose
of the covenants imposed by the Company’s borrowings (refer note 20 and 22)
that was entered into to finance the development of Phase 1 of FWGR and working
capital requirements of the Group and subsequently amended for the issue of the
performance guarantee to Ekurhuleni Metropolitan Municipality (refer note 13).  116


---

23
 OPERATING
  SEGMENTScontinuedOther2019
 
 
 reconcilingAmounts
  in R million
 Ergo
 FWGR
 items
 TotalFinancial
  performanceRevenue
  (External)
 2,577.5
 184.6
 -
 2,762.1Cash
  operating costs
 (2,311.1)
 (111.8)
 -
 (2,422.9)Movement
  in gold in process and finished inventories - Gold Bullion
 16.4
 16.2
 -
 32.6Operating
  profit
 282.8
 89.0
 -
 371.8Retrenchment
  costs
 (1.6)
 (4.7)
 -
 (6.3)Administration
  expenses and other costs
 (12.0)
 (2.3)
 (76.6)
 (90.9)Interest
  income1
 6.5
 -
 10.4
 16.9Interest
  expense2
 (2.4)
 -
 (3.2)
 (5.6)Current
  tax
 1.6
 -
 -
 1.6Working
  profit/(loss) before additions to property, plant and equipment
 274.9
 82.0
 (69.4)
 287.5Additions
  to property, plant and equipment
 (22.8)
 (330.7)
 (0.2)
 (353.7)Working
  profit/(loss) after additions to property, plant and equipment
 252.1
 (248.7)
 (69.6)
 (66.2)1
  Interest income excludes the unwinding of the Payments made under protest2
  Interest expense excludes the discount recognised on the initial recognition
  of the Payments made under protestReconciliation
  of profit/(loss) for the year to working profit/(loss) before additions to
  property, plant and equipmentProfit/(loss)
  for the year
 82.3
 28.7
 (32.5)
 78.5-
  Deferred tax
 16.2
 13.4
 (1.4)
 28.2-
  Net other operating costs/(income)
 40.2
 15.4
 (25.7)
 29.9-
  Ongoing rehabilitation expenditure
 16.6
 1.7
 -
 18.3-
  Discount recognised on Payments made under protest including subsequent
  unwinding
 3.5
 -
 -
 3.5-
  Unwinding of provision for environmental rehabilitation
 45.4
 19.6
 1.3
 66.3-
  Growth in investment in environmental obligation funds
 (11.3)
 (22.5)
 (4.6)
 (38.4)-
  Other income
 (2.2)
 -
 (5.7)
 (7.9)-
  Change in estimate of environmental rehabilitation recognised in profit or
  loss
 (58.6)
 -
 (1.4)
 (60.0)-
  Depreciation
 142.8
 25.7
 0.6
 169.1Working
  profit/(loss) before additions to property, plant and equipment
 274.9
 82.0
 (69.4)
 287.5Statement
  of cash flowsCash
  flows from operating activities
 221.7
 89.3
 (22.7)
 288.3Cash
  flows from investing activities
 (39.4)
 (324.4)
 60.8
 (303.0)Cash
  flows from financing activities
 (291.7)
 236.7
 47.1
 (7.9)Reconciliation
  of adjusted EBITDAProfit
  for the year
 
 
 
 78.5Income
  tax
 
 
 
 26.6Profit
  before tax
 
 
 
 105.1Finance
  expense
 
 
 
 78.4Finance
  income
 
 
 
 (58.3)Results
  from operating activities
 
 
 
 125.2Depreciation
 
 
 
 169.1Share-based
  payment expense(increase
  in Long-Term Incentive liability)
 
 
 
 21.4Change
  in estimate of environmental rehabilitation recognised in profit or loss
 
 
 
 (60.0)Gain
  on financial instruments at fair value through profit or loss
 
 
 
 (2.1)Gain
  on disposal of property, plant and equipment
 
 
 
 (5.8)Retrenchment
  costs
 
 
 
 6.3Adjusted
  EBITDA1
 
 
 
 254.11
  Adjusted EBITDA (that was considered from the current reporting period
  following the RCF agreement) may not be comparable to similarly titled
  measures of other companies. Adjusted EBITDA is not a measure of performance
  under IFRS and should be considered in addition to, and not as a substitute
  for, other measures of financial performance and liquidity.
 117


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118


---

23
 OPERATING
  SEGMENTScontinuedOther2018
 
 reconcilingAmounts
  in R million
 Ergo
 items
 TotalFinancial
  performanceRevenue
  (External)
 2,490.4
 -
 2,490.4Cash
  operating costs
 (2,159.7)
 -
 (2,159.7)Movement
  in gold in process and finished inventories - Gold Bullion
 24.5
 -
 24.5Operating
  profit
 355.2
 -
 355.2Administration
  expenses and other costs1
 (11.5)
 (78.6)
 (90.1)Interest
  income2
 9.5
 12.3
 21.8Interest
  expense3
 (3.1)
 (1.0)
 (4.1)Current
  tax
 (2.9)
 (3.5)
 (6.4)Working
  profit/(loss) before additions to property, plant and equipment
 347.2
 (70.8)
 276.4Additions
  to property, plant and equipment
 (125.2)
 (0.9)
 (126.1)Working
  profit/(loss) after additions to property, plant and equipment
 222.0
 (71.7)
 150.31
  Administration expenses and general costs excludes loss on disposal of
  property, plant and equipment2
  Interest income excludes the unwinding of the Payments made under protest3
  Interest expense excludes the discount recognised on the initial recognition
  of the Payments made under protestReconciliation
  of profit/(loss) for the year to working profit/(loss) before additions to
  property, plant and equipmentProfit/(loss)
  for the year
 53.3
 (46.8)
 6.5-
  Deferred tax
 23.2
 (3.7)
 19.5-
  Net other operating costs/(income)
 36.2
 (15.6)
 20.6-
  Ongoing rehabilitation expenditure
 26.7
 -
 26.7-
  Discount recognised on Payments made under protest including subsequent
  unwinding
 8.1
 -
 8.1-
  Unwinding of provision for environmental rehabilitation
 44.3
 1.3
 45.6-
  Loss on disposal of property, plant and equipment
 0.6
 -
 0.6-
  Growth in investment in environmental obligation funds
 (10.1)
 (6.2)
 (16.3)-
  Change in estimate of environmental rehabilitation recognised in profit or
  loss
 (2.5)
 (0.4)
 (2.9)-
  Depreciation
 167.4
 0.6
 168.0Working
  profit/(loss) before additions to property, plant and equipment
 347.2
 (70.8)
 276.4Statement
  of cash flowsCash
  flows from operating activities
 285.3
 (51.5)
 233.8Cash
  flows from investing activities
 (140.2)
 (0.2)
 (140.4)Cash
  flows from financing activities
 (2.8)
 (42.2)
 (45.0)
 119


---

23
 OPERATING
  SEGMENTScontinuedOther2017
 
 reconcilingAmounts
  in R million
 Ergo
 items
 TotalFinancial
  performanceRevenue
  (External)
 2,339.9
 -
 2,339.9Cash
  operating costs
 (2,087.9)
 -
 (2,087.9)Movement
  in gold in process and finished inventories - Gold Bullion
 4.8
 -
 4.8Operating
  profit
 256.8
 -
 256.8Interest
  income
 6.8
 16.8
 23.6Interest
  expense
 (3.3)
 (2.4)
 (5.7)Retrenchment
  costs
 (23.0)
 -
 (23.0)Administration
  expenses and other costs
 (4.5)
 (64.9)
 (69.4)Current
  tax
 (1.9)
 -
 (1.9)-
 -
 -Working
  profit/(loss) before additions to property, plant and equipment
 230.9
 (50.5)
 180.4Additions
  to property, plant and equipment
 (116.2)
 (0.1)
 (116.3)Additions
  to listed investments
 -
 (0.1)
 (0.1)-
 -
 -Working
  profit/(loss) after additions to property, plant and equipment
 114.7
 (50.7)
 64.0Reconciliation
  of profit/(loss) for the year to working profit/(loss) before additions to
  property, plant and equipmentProfit/(loss)
  for the year
 17.9
 (4.2)
 13.7-
  Deferred tax
 (54.2)
 1.9
 (52.3)-
  Net other operating (costs)/income
 30.3
 (31.3)
 (1.0)-
  Ongoing rehabilitation expenditure
 22.4
 -
 22.4-
  Unwinding of provision for environmental rehabilitation
 45.3
 1.2
 46.5-
  Profit on disposal of property, plant and equipment
 (0.2)
 (12.7)
 (12.9)-
  Growth in environmental rehabilitation obligation funds
 (10.9)
 (5.5)
 (16.4)-
  Impairments
 -
 -
 --
  Change in estimate of provision for environmental rehabilitation recognised
  in profit or loss
 0.6
 -
 0.6-
  Depreciation
 179.7
 0.1
 179.8Working
  profit/(loss) before additions to property, plant and equipment
 230.9
 (50.5)
 180.4Statement
  of cash flowsCash
  flows from operating activities
 32.5
 19.1
 51.6Cash
  flows from investing activities
 (116.6)
 19.9
 (96.7)Cash
  flows from financing activities
 (2.4)
 (50.6)
 (53.0)
  24
 INTEREST IN SUBSIDIARIESACCOUNTING
  POLICIES
  Significant
  subsidiaries of the Group are those subsidiaries with the most significant
  contribution to the Group's profit or loss or assets.
  Ergo Mining Proprietary Limited and Far
West Gold Recoveries Proprietary Limited are the only significant subsidiaries
of the Group. They are both wholly owned subsidiary and are incorporated in
South Africa, are primarily involved in the retreatment of surface gold and all
their operations are based in South Africa. 120


---

25
 OTHER ASSETSSIGNIFICANT
  ACCOUNTING JUDGEMENTS
  The
  assessment to develop and apply the relevant accounting policy for payments
  made under protest that arise from the Municipality Electricity Tariff
  Dispute (refer note26)
  (“Payments made under protest“) requires the exercise of significant
  judgement about the outcome of future events that are not wholly under the
  control of the Group.
  The
  judicial proceedings that impact the Payments made under protest are
  inherently complex legal issues that are subject to uncertainties and
  complexities and are subject to interpretation.
  
  SIGNIFICANT
  ACCOUNTING ASSUMPTIONS AND ESTIMATES
  The
  discounted amount of the Payments made under protest is determined using
  assumptions about the future that are inherently uncertain and can change
  materially over time and includes the discount rate and discount period.
  These
  assumptions about the future include estimating the timing of concluding on
  the main application, i.e. the discount period, the ultimate settlement terms
  (refer note26),
  the discount rate applied and the assessment of recoverability.
  
  ACCOUNTING
  POLICIES
  PAYMENTS
  MADE UNDER PROTEST
  Recognition
  and measurement
  The asset that arises from theMunicipality
  Electricity Tariff Dispute(refer note 26) and that are payments made under protest is
  initially measured at a discounted amount and any difference between the face
  value of payments made under protest and the discounted amount on initial
  recognition is recognised in profit or loss as a finance expense. Subsequent
  to initial recognition, the Payments made under protest is measured using the
  effective interest method to unwind the discounted amount to the original
  face value less any write downs for recovery. Unwinding of the carrying value
  and changes in the discount period are recognised in profit or loss.
  Assessment
  of recoverability
  The discounted amount of the payments under protest is assessed
  at each reporting date to determine whether there is any objective evidence
  that the full amount is no longer expected to be recovered. The Group
  considers the reasonable and supportable information related to the
  creditworthiness of Ekurhuleni Metropolitan Municipality and events
  surrounding the outcome of the Main Application (refer note 26).  Any write
  down is recognised in profit or loss.
  
  INVESTMENTS IN OTHER ENTITIES
  Accounting policy before 1 July
  2018
  The Group’s listed and
  unlisted investments in equity securities are classified as
  available-for-sale financial assets. These assets are initially recognised at
  fair value plus any directly attributable transaction costs. Subsequent to
  initial recognition they are measured at fair value and changes therein,
  other than impairment losses, are recognised in OCI.
  Accounting policy after 1 July 2018
  The Group’s listed and unlisted
  investments in equity securities are classified as equity instruments at fair
  value through other comprehensive income (OCI). These assets are initially
  recognised at fair value plus any directly attributable transaction costs.
  Subsequent to initial recognition they are measured at fair value and changes
  therein are recognised in OCI, and are never reclassified to profit or loss.
  Amounts
  in R million
 Note
 2019
 2018Payments
  made under protest
 25.1
 27.6
 19.3Investments
  in other entities
 25.2
 3.5
 9.4Total
  other assets
 
 31.1
 28.7
 25.1
 PAYMENTS MADE UNDER PROTEST
 During the
year, payments
were made under protest (“Payments made under protest”) to the
Municipality (refer
note 26) amounting to R11.7 million (excluding VAT) (2018: R27.4 million consisting
of initial payment of R22.5 million as well as subsequent payments of R4.9
million) comprising the difference between the J-tariff and the Eskom tariff.
The initial payment in 2018 was made from cash held in escrow relating to the
electricity tariff dispute with Ekurhuleni Metropolitan Municipality (refer
note 13). Subsequent payments were made from operating cash flows. The payments made during
the year were initially recognised at the discounted amount, taking into
consideration the discount rate and discount period. An amount of R6.5 million  (2018:
R8.8 million) was recognised as finance expense (refer note 8) and 121


---

includes the discount at initial recognition as well as
the change in assumption regarding the discount period ending June 30, 2022
(previously discount period ended June 30, 2021) respectively. The discounted amount was
based on the following assumptions: ·discount
rate: 11.68% (2018:
11.68%) representing
the Municipality maximum cost of borrowing on bank loans as disclosed in their June
30, 2018 annual report; and ·discount
period: June 30, 2022 (2018: June 30, 2021) representing
management’s best estimate of the date of conclusion of the Main Application. During the year R3.0
million was
recognised as finance income (refer note7) for the unwinding of
the discount amount. 25.2
 INVESTMENTS
  IN OTHER ENTITIESAmounts
  in R million
 Shares
  held
 % held
 2019
 2018Listed
  investments (Fair value hierarchy Level 1):
 
 
 3.3
 9.2West
  Wits Mining Limited ("WWM")
 47
  812 500
 6.7%
 3.3
 9.2Unlisted
  investments (Fair value hierarchy Level 3):
 
 
 0.2
 0.2Rand
  Refinery Proprietary Limited ("Rand Refinery") (a)
 44
  438
 11.0%
 -
 -Guardrisk
  Insurance Company Limited (Cell Captive A170) ^
 20
 #
 0.1
 0.1Chamber
  of Mines Building Company Proprietary Limited
 30
  160
 3.0%
 0.1
 0.1Rand
  Mutual Assurance Company Limited
 1
 #
 -
 -3.5
 9.4Fair
  value adjustment on equity instruments at fair value through OCI
 
 
 (5.9)
 -Fair
  value adjustment on available for sale financial assets recognised in OCI
 
 
 -
 0.6#Represents a less than 1% shareholding.^ Class A
  170 shares are held in Guardrisk Insurance Company Limited that entitles the
  holder to 100% of the residual net equity of the Cell Captive A 170 after settlement
  of the reimbursive right.
 (a)    Rand
Refinery Rand Refinery is a related party to DRDGOLD
through Sibanye-Stillwater who holds a 44.4% interest in Rand Refinery and a
38.05% interest in DRDGOLD respectively. The estimated fair value of the investment in
Rand Refinery shares remainsde minimisdue to the uncertainty regarding
Rand Refinery's future free cash flows and the lack of marketability of the
shares held. MARKET RISK Other market price risk Equity price risk arises from changes in quoted
market prices of listed investments as well as changes in the fair value of
unlisted investments due to changes in the underlying net asset values. FAIR VALUE OF FINANCIAL INSTRUMENTS Listed investments The fair values of listed investments are
determined by reference to published price quotations from recognised
securities exchanges and constitute level 1 instruments in the fair value
hierarchy. Unlisted investments The valuations are based on either the net
asset values of these companies, or the consideration of unobservable financial
information which is compared to information available in the market regarding
other market participants' views on the value of the company and constitute
level 3 instruments in the fair value hierarchy. 122


---

26
 CONTINGENT ASSETS AND LIABILITIESSIGNIFICANT
  ACCOUNTING JUDGEMENTS
  The
  assessment of whether an obligating event results in a liability or a
  contingent liability requires the exercise of significant judgement of the
  outcome of future events that are not wholly within the control of the Group.
  Litigation
  and other judicial proceedings inherently entail complex legal issues that
  are subject to uncertainties and complexities and are subject to
  interpretation.
  ACCOUNTING POLICIES
  A
  contingent liability is a possible obligation arising from past events and
  whose existence will be confirmed only by occurrence or non-occurrence of one
  or more uncertain future events not wholly within the control of the Group. A
  contingent liability may also be a present obligation arising from past
  events but is not recognised on the basis that an outflow of economic
  resources to settle the obligation is not viewed as probable, or the amount
  of the obligation cannot be reliably measured. When the Group has a present
  obligation, an outflow of economic resources is assessed as probable and the
  Group can reliably measure the obligation, a provision is recognised.
  Environmental Mine residue
deposits may have a potential pollution impact on ground water through seepage.
The Group has taken certain preventative actions as well as remedial actions in
an attempt to minimise the Group’s exposure and environmental contamination. The flooding of the
western and central basins have the potential to cause pollution due to Acid
Mine Drainage (“AMD”) contaminating the ground water. The government has
appointed Trans-Caledon Tunnel Authority (“TCTA”) to construct a partial treatment
plant to prevent the ground water being contaminated. TCTA completed the
construction of the neutralisation plant for the Central Basin and commenced
treatment during July 2014. As part of the heads of agreement signed in
December 2012 between EMO, Ergo, ERPM and TCTA, sludge emanating from this
plant since August 2014 has been co-disposed onto the Brakpan Tailings Storage
facility. Partially treated water has been discharged by TCTA into the Elsburg
Spruit. This agreement includes
the granting of access to the underground water basin through one of ERPM’s
shafts and the rental of a site onto which it constructed its neutralisation
plant. In exchange, Ergo and its associate companies including ERPM have a
set-off against any future directives to make any contribution toward costs or
capital of up to R250 million. Through this
agreement, Ergo also secured the right to purchase up to 30 Ml of partially
treated AMD from TCTA at cost, in order to reduce Ergo’s reliance on potable
water for mining and processing purposes. While the heads of
agreement should not be seen as an unqualified endorsement of the state’s AMD
solution, and do not affect our right to either challenge future directives or
to implement our own initiatives should it become necessary, it is an
encouraging development. DRDGOLD, through its
participation in the Western Utilities Corporation initiative, provided the
government with a solution for a sustainable long-term solution to AMD. This
solution would have been at no cost to the mines and government. In view of the
limitation of current information for the accurate estimation of a potential
liability, no reliable estimate can be made for the possible obligation.  123


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26   CONTINGENT ASSETS AND
LIABILITIEScontinued Ekurhuleni
Metropolitan Municipality ("Municipality") Electricity Tariff Dispute The Main Application There are primarily 3 (three) legal proceedings for which relief
has been sought in the appropriate legal fora and all of which fall within the
jurisdiction of the High Court of South Africa, Gauteng Local Division,
Johannesburg. (a)  The Main Application – case number 45277/ 2014 (b)  The Summons – case number 19222/2017 (c)   The Second Summons – case number 22648/2019 The Main
Application ERGO is arguably the world’s largest gold surface tailings
retreatment facility. Integral to this operation is ERGO’s metallurgical plant
at Brakpan (“ERGO Plant”) within the jurisdiction of the City of Ekurhuleni
Metropolitan Municipality (“Municipality”) where gold is extracted.  In order to
operate the ERGO Plant and conduct its business operations, ERGO requires a
reliable and steady feed of electricity of approximately 20 MVA (twenty mega
volt amp) which it draws from the ERGO Central Substation.  Over the past
several years the Municipality has charged ERGO for such electricity, at the
Megaflex tariff at which ESKOM Holdings SOC Limited (“ESKOM”) charges its large
power users plus an additional surcharge, as it still does; and ERGO paid
therefor.  Pursuant to
its own investigations, and after having sought legal advice on the matter,ERGO determined that only ESKOM may legitimately charge it for the
electricity so drawn and consumed at the ERGO Plant, specifically from the ERGO
Central Substation.  Despite this, ESKOM refused to either accept payment from
ERGO in respect of such electricity consumption or to conclude a consumer
agreement with it.  ERGO then
subsequentlyadvised the Municipality that it
would, forthwith with effect from December 2014, only pay for electricity
consumption at the Megaflex tariff and would instead, and under protest, pay
the additional surcharge into a trust account of its attorneys of record. In December 2014, ERGO instituted legal proceedings by way of an
application against the Municipality and ESKOM as well as the National Energy
Regulator of South Africa (“NERSA”), the Minister of Energy, the Minister of
Co-operative Governance & Traditional Affairs and the South African Local
Government Association, the latter 4 (four) respondents against whom ERGO does
not seek any relief.  ERGO seeks
the undermentioned relief: 1.    declaringthat the Municipality does not supply
electricity to it at the ERGO Plant;  2.    declaring
that the Municipality is in breach of its temporary Distribution Licence
(issued by NERSA) by purporting to supply electricity to ERGO at the ERGO
Plant;  3.    declaring
that neither the Municipality nor ESKOM may lawfully insist that only the
Municipality may supply electricity to ERGO at the ERGO Plant;  4.    declaring
that ESKOM presently supplies electricity to ERGO at the ERGO Plant; and  5.    directing
ESKOM to conclude a consumer agreement with ERGO for the supply of electricity
at the ERGO Plant at its Megaflex tariff.  Ergo also
instituted a counterclaim against the Municipality for the recovery of the
surcharges which were erroneously paid to the Municipality in thebona fidebelief that they were due and payable prior to the Main Application of
approximately R43 million (these surcharges were expensed for accounting
purposes).  The
hearing in respect of the Main Application was set down for hearing on 05
December 2018. The Main Application did not proceed on 05 December 2018. The Main Application was postponed by agreement between the
parties, after a proposal was addressed to the Deputy Judge President of the
Gauteng Local Division of the High Court sitting in Johannesburg in November
2018 to have a case manager appointed to deal with both the Main Application
and Action Matter, to determine a collaborative process to facilitate
effective, efficient court scheduling and coordination; in the interests of the
proper administration of justice.  124


---

26   CONTINGENT ASSETS AND LIABILITIEScontinued Ekurhuleni
Metropolitan Municipality ("Municipality") Electricity Tariff Disputecontinued  The Summons  In June 2017, the Municipality instituted action proceedings
against ERGO by way of summons to recover an amount of approximately R74
million for alleged arrear amounts for the electricity consumption at the ERGO Central
Substation in terms of section 3 of the By-Laws and further seeking an order by
the Court declaring the Remaining Extent of Portion 183 of the Farm Witpoortje
117, Registration Division IR, measuring in extent 233.0033 Ha, held under Deed
of Transfer T48746/2014 and on which the metallurgical plant is situated
executable and capable of being sold to settle and pay the alleged full
outstanding amount which the Municipality alleges is due and owing thereto.  The action was launched by the Municipality to arrest
prescription, to avoid the claim for the alleged arrear surcharge amounts from
becoming extinguished, as envisaged in the Prescription Act, 68 of 1969, by
virtue of the expiration of a period of 3 years from 30 November 2014, being
the date from which ERGO stopped paying the surcharge levied by the
Municipality thereto and from which date the Municipality alleges that ERGO was
making partial payments of the full account rendered to it by the Municipality
in respect of the “supply” of electricity at the ERGO Central Substation.  Pursuant to the Constitutional Court ruling in January 2018 in
respect of ERGO’s petition for leave to appeal thereto in the urgent
application in terms of which the Municipality threatened to terminate and/or
interfere with the supply of electricity at the ERGO Central Substation, ERGO
was no longer entitled to withhold payment based on its allegation that the
Municipality was not supplying electricity at the ERGO Central Substation,
pending the final determination of the Main Application; the resultant effect
of which was that ERGO would now run the risk of a discontinuation of supply if
it did not pay the charges claimed.  ERGO continued to make payments to the Municipality, albeit under
protest and without prejudice and/or admission of liability; based on the
recently introduced “J-Tariff”, which, whilst still deemed to be
disproportionate, was significantly lower than the previously imposed
“D-Tariff”.The
Group recognised an asset for these payments made under protest(refer note 25.1).  As a result of the conclusion of this latter “without prejudice”
arrangement with the Municipality, ERGO brought an application for leave to
amend its plea and counter claim; to which the Municipality objected. ERGO’s
application was argued before Judge Spilg (the judicially appointed case
manager) on 27 March 2019 and judgment in respect thereof is still awaited. The Second Summons In June 2019, the Municipality served the second summons on ERGO
seeking an amount of R31.6 million in respect of electricity allegedly supplied
to ERGO.  The Consolidated Application ERGO has sought to apply for consolidation of the disputes. The
Municipality is opposed to any consolidation. At this stage no application for consolidation has been launched.  The parties have agreed, together with the case manager, that the
judgments will first be handed down in regard to the aforementioned
interlocutory applications, which will inform the parties as to the need to
consolidate.  It is ERGO’s view that the first and second actions (first and
second summons) should be consolidated.  Accordingly, the action matters to be
consolidated should be heard separately and in advance of the Main Application,
as a decision in regard to the actions, will essentially be determinative of
the Main Application.  The reasons for the consolidation are due to the fact that the
parties are identical and the central dispute in both actions and the Main
Application revolves around the same question, namely who supplies the
electricity to the Plant.  The evidence will be identical in all three matters.  125


---

26   CONTINGENT
ASSETS AND LIABILITIEScontinued Occupational Lung Diseases On May 3, 2018, former mineworkers and dependents of deceased
mineworkers (“Applicants”) and Anglo American South Africa Limited,
AngloGold Ashanti Limited, Sibanye Gold Limited trading as Sibanye-Stillwater,
Harmony Gold Mining Company Limited, African Rainbow Minerals Limited and
certain of their affiliates (“Settling Companies”) settled the class
certification application in which the Applicants in each sought to certify
class actions against gold mining houses cited therein on behalf of mineworkers
who had worked for any of the particular respondents and who suffer from any
occupational lung disease, including silicosis or tuberculosis. The DRDGOLD Respondents, comprising DRDGOLD Limited and East Rand
Proprietary Mines Limited, are not a party to the settlement between the
Applicants and Settling Companies. In December 2018, the Applicants and Settling Companies approached
the Gauteng Local Division of the High Court, Johannesburg on anex partebasis to make the settlement agreement an order of court. The application was heard on May 29, 2019 and on July 26, 2019,
the Gauteng Local Division of the High Court, Johannesburg approved the
settlement agreement. The Settling Companies together with the Applicants have
established a settlement trust (named the Tshiamiso Trust) to administer the
benefits which have been estimated to be in the amount of R5 billion. There are
ten classes of claimants who, once properly certified, will be eligible for a
benefit. The settlement agreement is not binding on the DRDGOLD
Respondents. The dispute, insofar as the class certification application and appeal
thereof is concerned, still stands and has not terminated in light of the
settlement agreement.  DRDGOLD maintains the view that it is too early to consider
settlement of the matter, mainly for the following reasons: •      the Applicants have as yet not issued and served a
summons (claim) in the matter; •      there is no
indication of the number of potential claimants that may join the class action
against the DRDGOLD respondents; •      many principles upon which legal responsibility is
founded, are required to be substantially developed by the trial court (and
possibly subsequent courts of appeal) to establish liability on the bases
alleged by the applicants. In light of
the above there is inadequate information to determine if a sufficient legal
and factual basis exists to establish liability, and to quantify such potential
liability. 27   FINANCIAL INSTRUMENTS CLASSIFICATION AND MEASUREMENT OF FINANCIAL
ASSETS Financial assets are not reclassified
subsequent to their initial recognition unless the Group changes its business
model for managing financial assets, in which case all affected financial
assets are reclassified on the first day of the first reporting period
following the change in business model. A
financial asset shall be measured at amortised cost if both the following
conditions are met: ·the
financial asset is held within a business model whose objective is to hold
financial assets in order to collect contractual cash flows; and ·the
contractual terms of the financial asset give rise of specified dates to cash
flows that are solely payments of principal and interest on the principal
amount outstanding.  An investment is
measured at fair value through other comprehensive income if it meets both of
the following conditions and is not designated as at fair value through profit
or loss: ·It
is held with a business model whose objective achieved by both collecting
contractual cash flows and selling financial assets; and ·Its
contractual terms give rise on specified dates to cash flows that are solely
payments of principal and interest on the principal amount outstanding.  126


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27   FINANCIAL
INSTRUMENTScontinued FINANCIAL RISK MANAGEMENT FRAMEWORK Overview The Group has exposure to credit risk,
liquidity risks, as well as other market risks from its use of financial
instruments. This note presents information about the Group’s exposure to each
of the above risks, the Group’s objectives and policies and processes for
measuring and managing risk. The Group’s management of capital is disclosed in
note 20. This note must be read with the quantitative disclosures included
throughout these consolidated financial statements. The board of directors (“Board”) has overall
responsibility for the establishment and oversight of the Group’s risk
management framework. The Board has established the Audit and Risk Committee (“ARC”), which is responsible
for developing and monitoring the Group’s risk management policies. The
committee reports regularly to the Board on its activities. The Group’s risk management policies are
established to identify and analyse the risks faced by the Group, to set
appropriate risk limits and controls, and to monitor risks and adherence to
limits. Risk management policies and systems are reviewed regularly to reflect
changes to market conditions and the Group’s activities. The Group, through its
training and management standards and procedures, aims to develop a disciplined
and constructive control environment in which all employees understand their
roles and obligations. The ARC oversees how management monitors
compliance with the Group’s risk management policies and procedures, and
reviews the adequacy of the risk management framework in relation to the risks
faced by the Group. The ARC is assisted in its oversight role by the internal
audit function. The internal audit function undertakes both regular and ad hoc
reviews of risk management controls and procedures, the results of which are
reported to the ARC. CREDIT RISK Credit risk is the risk of financial loss to
the Group if a customer or counterparty to a financial instrument fails to meet
its contractual obligations, and arises principally from the Group’s trade and
other receivables. The Group’s financial instruments do not
represent a concentration of credit risk due to the exposure to credit risk
being managed as disclosed in the following notes: NOTE 12      INVESTMENTS
IN REHABILITATION OBLIGATION FUNDS NOTE 13      CASH AND CASH EQUIVALENTS NOTE 15      TRADE AND OTHER
RECEIVABLES  MARKET RISK Market risk is the risk that changes in market
prices, such as commodity prices, foreign exchange rates, interest rates and
equity prices will affect the consolidated profit or loss or the value of its
financial instruments. The objective of market risk management is to manage and
control market risk exposures within acceptable parameters, while optimising
returns. Commodity price risk Additional disclosures are included in
the following note: NOTE 5         REVENUE Other
market risk Additional disclosures are included in
the following note: NOTE 25.2   INVESTMENTS
IN OTHER ENTITIES Interest
rate risk Fluctuations in interest rates impact on the
value of short-term cash investments and financing activities, giving rise to
interest rate risk. In the ordinary course of business, the Group receives cash
from its operations and is obliged to fund working capital and capital
expenditure requirements. This cash is managed to ensure surplus funds are
invested in a manner to achieve maximum returns while minimising risks. Lower
interest rates result in lower returns on investments and deposits and also may
have the effect of making it less expensive to borrow funds at then current
rates. Conversely, higher interest rates result in higher interest payments on
loans and overdrafts. Additional disclosures are included in
the following notes: NOTE 12      INVESTMENTS IN
REHABILITATION OBLIGATION FUNDS NOTE 13      CASH AND CASH EQUIVALENTS  127


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27   FINANCIAL
INSTRUMENTScontinued FINANCIAL RISK MANAGEMENT FRAMEWORKcontinued MARKET RISKcontinued Foreign
currency risk The Group enters into transactions denominated
in foreign currencies, such as gold sales denominated in US dollar, in the
ordinary course of business. This exposes the Group to fluctuations in foreign
currency exchange rates. Additional disclosures are included in
the following notes: NOTE 15      TRADE AND OTHER
RECEIVABLES  LIQUIDITY
RISK Liquidity risk is the risk that the Group will
not be able to meet its financial obligations as they fall due. The Group’s
approach to managing liquidity is to ensure, as far as possible, that it will
always have sufficient liquidity to meet its liabilities when due, under both
normal and stressed conditions, without incurring unacceptable losses or
risking damage to the Group’s reputation. The Group ensures that it has sufficient cash
on demand to meet expected operational expenses, including the servicing of
financial obligations; this excludes the potential impact of extreme
circumstances that cannot reasonably be predicted, such as natural disasters. Additional disclosures are included in
the following note: NOTE 16      TRADE AND OTHER PAYABLES NOTE 20      CAPITAL MANAGEMENT 28   RELATED PARTIES Disclosures
are included in the following notes: NOTE 6        COST
OF SALES NOTE 16      TRADE
AND OTHER PAYABLES NOTE 19.2  TRANSACTIONS
WITH KEY MANAGEMENT PERSONNEL NOTE 21      EQUITY NOTE 24      INTEREST
IN SUBSIDIARIES  29   SUBSEQUENT EVENTS There were no significant subsequent events
between the year-end reporting date of June 30, 2019 and the date of issue of
these financial statements other than described below and included in the
preceding notes to the consolidated financial statements. Dividend On September 3, 2019, the Board declared a
final dividend for the year ended June 30, 2019 of 20 SA cents per
share, which was paid on September 30, 2019.  128


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ITEM 19. EXHIBITS  The following exhibits are filed as a part of this
Annual Report: 1.1(1)
 Memorandum of Association of DRDGOLD Limited.1.2(6)
 Articles of Association of DRDGOLD Limited, as amended
  on November 8, 2002.
  http://www.sec.gov/Archives/edgar/data/1023512/000104746902008746/a2096282zex-1_2.txt1.3(1)
 Excerpts of relevant provisions of the South African
  Companies Act.1.5(9)
 Memorandum of Incorporation, as amended on November 30,
  2012.
  http://www.sec.gov/Archives/edgar/data/1023512/000120561313000188/ex1_5.htm2.1(1)
 Excerpts of relevant provisions of the Johannesburg
  Stock Exchange Listings Requirements.2.2(4)
 Indenture between DRDGOLD Limited, as Issuer, and The
  Bank of New York Mellon, as Trustee, dated November 12, 2002.
  http://www.sec.gov/Archives/edgar/data/1023512/000104746902008746/a2096282zex-2_2.txt4.1(2)
 Deposit Agreement among DRDGOLD Limited, The Bank of
  New York Mellon as Depositary, and owners and holders of American Depositary
  Receipts, dated as of August 12, 1996, as amended and restated as of October
  2, 1996, as further amended and restated as of August 6, 1998, as further
  amended and restated July 23, 2007.4.2(3)
 Form of Non‐Executive Employment Agreement.4.3(3)
 Form of Executive Employment Agreement.4.4(4)
 Agreement between DRDGOLD Limited and Rand Refinery
  Limited, dated October 12, 2001.
  http://www.sec.gov/Archives/edgar/data/1023512/000104746902008746/a2096282zex-4_36.txt4.5(12)
 Local Mine Bullion Refining Agreement between DRDGOLD
  Limited and Rand Refinery Limited, dated June 27, 2018.
  http://www.sec.gov/Archives/edgar/data/1023512/000102351218000003/exhibit4.htm4.6(5)
 Option Agreement entered into by and between DRDGOLD Limited and M5
  Developments Proprietary Limited, dated July 21, 2005.
  http://www.sec.gov/Archives/edgar/data/1023512/000120561305000206/ex4_91.htm4.7(7)
 Domestic
  Medium Term Note Programme (“Programme”) entered into by DRDGOLD South
  African Operations Proprietary Limited (“Issuer”) and DRDGOLD Limited
  (“guarantor’) dated September 30 2010.
  http://www.sec.gov/Archives/edgar/data/1023512/000120561310000164/ex4_138.htm4.8(8)
 Domestic
  Medium Term Note ) and High Yield Programme (“DMTN Programme”)  Agreement entered
  into by DRDGOLD  Limited (“Issuer”)  Crown Gold Recoveries Proprietary
  Limited  (“Crown Gold”), East Rand Proprietary Mines Limited (“ERPM”), Ergo
  Mining Operations Proprietary Limited (“EMO”) )and  ABSA Bank  Limited
  (“ABSA”) ) dated  June 30, 2012.
  http://www.sec.gov/Archives/edgar/data/1023512/000120561312000150/ex4_139.htm4.9(8)
 Sale
  of Shares and Claims Agreement entered into by Village Main Reef Limited
  (“Village”), DRDGOLD Limited (“DRDGOLD”) (“Seller”), Business Venture
  Investments No 1557 Proprietary Limited (“Purchaser”) and Blyvooruitzicht
  Gold Mining Company Limited (“Blyvoor”) dated February 11, 2012.
  http://www.sec.gov/Archives/edgar/data/1023512/000120561312000150/ex4_140.htm4.10(9)
 Heads
  of Agreement entered into by Trans-Caledon Tunnel Authority (“TCTA’), Ergo
  Mining Operations Proprietary Limited (“EMO”), East Rand Proprietary Mines
  Limited (“ERPM”) and Crown Gold Recoveries Proprietary Limited (“CGR”)
  (collectively CGR, EMO and ERPM are called “the Ergo Group”) dated November
  28, 2012.
  http://www.sec.gov/Archives/edgar/data/1023512/000120561313000188/ex4_39.htm4.11(10)
 Share
  Sale and Subscription Agreement between DRDGOLD Limited ("DRDGOLD")
  and Khumo Gold SPV Proprietary Limited ("Khumo") dated March 17,
  2014.
  http://www.sec.gov/Archives/edgar/data/1023512/000120561314000145/ex4_40.htm4.12(10)
 Share
  Sale and Subscription Agreement between DRDGOLD Limited ("DRDGOLD")
  and DRDSA Empowerment Trust (the Trust) dated March 17, 2014.
  http://www.sec.gov/Archives/edgar/data/1023512/000120561314000145/ex4_41.htm
 129


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ITEM 19. EXHIBITS  The following exhibits are filed as a part of this
Annual Report: 4.13(11)
 Settlement
  Agreement between DRDGOLD Limited ("DRDGOLD") and VMR Gold
  Investments 02 Proprietary Limited ("VMR Gold") dated May 28, 2015.
  http://www.sec.gov/Archives/edgar/data/1023512/000120561315000144/ex4_42.htm8.1(13)
 List of Subsidiaries.10.1(12)
 DRD Exchange Agreement entered into by DRDGOLD Limited
  (“DRDGOLD”) and Sibanye Gold Limitedhttp://www.sec.gov/Archives/edgar/data/1023512/000102351218000003/exhibit10.htm10.2(12)
 Sibanye-Stillwater Exchange Agreement entered into by
  Sibanye Gold Limited and K2017449061 (South Africa) Proprietary Limited (to
  be renamed WRTRP Proprietary Limited) and including DRDGOLD Limited
  (“DRDGOLD”)http://www.sec.gov/Archives/edgar/data/1023512/000102351218000003/exhibit10002.htm10.3(12)
 DRD Guarantee issued by DRDGOLD Limited (“DRDGOLD”) to
  and in favor of Sibanye Gold Limited.http://www.sec.gov/Archives/edgar/data/1023512/000102351218000003/exhibit10003.htm10.4(12)
 DRD Option Agreement between DRDGOLD Limited
  (“DRDGOLD”) and Sibanye Gold Limited.http://www.sec.gov/Archives/edgar/data/1023512/000102351218000003/exhibit10004.htm10.5(12)
 Closing and Amending Agreement, dated 20 July 2018,
  among Sibanye Gold Limited, WRTRP Proprietary Limited and DRDGOLD Limited;
  each of the following annexures are incorporated by reference to Sibanye-Stillwater's
  Schedule 13-D, Exhibit 99.5 filed with the Securities and Exchange Commission
  on July 31, 2018
  Annexure A — Approval of Financial Surveillance Department
  of SARB;
  Annexure B — JSE Approval of DRD Circular;
  Annexure C — TRP Approval of DRD Circular;
  Annexure D — Approval in Terms of Competition Act;
  Annexure E — Press Announcement Confirming Approval of
  DRD Shareholders;
  Annexure F — Environmental Authorisations and Waste
  Management Licences;
  Annexure G — Confirmation of VAT Registration of
  Issuing Party;
  Annexure H — Lender’s Consent in Terms of the Rand
  Revolving Credit Facility; and
  Annexure I — Employees of the Business as at the
  Delivery Date of the Closing and Amending Agreement.
  http://www.sec.gov/Archives/edgar/data/1023512/000110465918048791/0001104659-18-048791-index.htm
  http://www.sec.gov/Archives/edgar/data/1023512/000102351218000003/exhibit10005.htm10.6(12)
 Revolving Credit Facility.
  http://www.sec.gov/Archives/edgar/data/1023512/000102351218000003/exhibit10006.htm10.7(13)
 First Addendum to
  the Revolving Credit Facility10.8(13)
 ABSA Ergo Mining
  Performance Guarantee Number 175 02 0183033 G12.1(13)
 Certification pursuant to
  Section 302 of the Sarbanes‐Oxley Act of 2002.12.2(13)
 Certification
  pursuant to Section 302 of the Sarbanes‐Oxley Act of 2002.13.1(13)
 Certification pursuant to
  Section 906 of the Sarbanes‐Oxley Act of 2002.13.2(13)
 Certification
  pursuant to Section 906 of the Sarbanes‐Oxley Act of 2002.101.INS(14)
 XBRL
  Instance Document101.SCH(14)
 XBRL
  Taxonomy Extension Schema Document101.CAL(14)
 XBRL
  Taxonomy Extension Calculation Linkbase Document101.DEF(14)
 XBRL
  Taxonomy Extension Definition Linkbase Document101.LAB(14)
 XBRL
  Taxonomy Extension Label Linkbase Document101.PRE(14)
 XBRL
  Taxonomy Extension Presentation Linkbase Document
 ___________  130


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ITEM 19. EXHIBITS  The following exhibits are filed as a part of this
Annual Report: 
  (1)Incorporated by
reference to our Registration Statement (File No. 0-28800) on
Form 20-F. (2)Incorporated by
reference to Amendment No. 1 to our Registration Statement (File No.333-140850) on Form F-6. (3)Incorporated by
reference to our Annual Report on Form 20-F for the fiscal year ended
June 30, 2000. (4)Incorporated by
reference to our Annual Report on Form 20-F for the fiscal year ended
June 30, 2002. (5)Incorporated by
reference to our Annual Report on Form 20-F for the fiscal year ended June 30,
2005. (6)Incorporated by
reference to our Annual Report on Form 20-F for the fiscal year ended June 30,
2006. (7)Incorporated by
reference to our Annual Report on Form 20-F for the fiscal year ended June 30,
2010. (8)Incorporated by
reference to our Annual Report on Form 20-F for the fiscal year ended June 30,
2012. (9)Incorporated by
reference to our Annual Report on Form 20-F for the fiscal year ended June 30,
2013. (10)Incorporated by
reference to our Annual Report on Form 20-F for the fiscal year ended June 30,
2014. (11)Incorporated by
reference to our Annual Report on Form 20-F for the fiscal year ended June 30,
2015. (12)Incorporated by
reference to our Annual Report on Form 20-F for the fiscal year ended June 30,
2018. (13)Filed herewith. (14)To be filed by amendment
pursuant to Rule 405(f)(2) of Regulation S-T.  131


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SIGNATURES  The registrant hereby certifies that it meets all of the
requirements for filing on Form 20-F and that it has duly caused and
authorized the undersigned to sign this annual report on its behalf.  DRDGOLD LIMITEDBy:
 /s/ D.J. Pretorius
  D.J. Pretorius
  Chief Executive OfficerBy:
 /s/ A.J. Davel
  A.J. Davel
  Chief Financial OfficerDate: October 31, 2019
  132


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